Dean v Zeene

1. [1]

   The plaintiff in these proceedings, Ms Cherylyn Tonia Dean, and the defendant, Mr Peter Elias Zeene, were formerly married. The event that has led to their present predicament was a decision they made after their divorce to enter into a partnership to construct four home units at Woy Woy, NSW. On any view, the venture has been a financial disaster. Apparently, the parties entered into the partnership agreement on about 26 May 2004. They are still indebted in consequence. It is not clear how each will be able to pay their debts. The outcome of these proceedings may not finally relieve their travails.

2. [2]

   On the seventh day of a protracted eight-day final hearing, the prospect of settlement emerged serendipitously. In essence, each party abandoned significant positions that they had adopted, and the possibility of a consensus emerged. In consequence, orders were made by the Court by consent on 3 August 2017. Further orders were made by consent on 8 September 2017, for the purpose of accounts being taken between the parties with the aid of a referee.

Remaining issues

1. [3]

   It is sufficient to note that the outstanding issues concern, first, whether the Court should adopt the report of the referee, Mr Alexander (Alex) Lau, dated 20 October 2017, which was delivered in response to the orders made by the Court on 3 August 2017 and 8 September 2017. Ms Dean submits that the Court should adopt the report in full. Mr Zeene submits that the Court should adopt the report with four changes to correct errors that Mr Zeene claims were made by the referee.

2. [4]

   There is also an issue as to whether the Court should make orders that have the effect that Mr Zeene can maintain a charge over Ms Dean’s property at Dulwich Hill, NSW, to secure $250,000, or whether the promise that Ms Dean made to allow Mr Zeene to do so is no longer enforceable because the consideration offered by Mr Zeene has totally failed or, alternatively, a condition to the making of Ms Dean’s promise has not been satisfied.

3. [5]

   There are also a number of other orders, which are apparently not contentious, that the Court must make in order to edge towards the finality of these proceedings.

4. [6]

   Finally, on the issue of costs, Ms Dean has submitted that the Court should here and now make an order that each party pay their own costs of the proceedings. Mr Zeene’s position is that that approach is premature, and that in due course the Court must hear the parties’ submissions on the issue of costs.

Background

1. [7]

   I do not propose to set out the facts in any detail. Both the pleadings and the evidence provided to the Court by the parties were exceedingly complex and opaque, and canvassed a range of issues that have mostly fallen away. The outstanding issues will require the Court to delve into some complex aspects of the proceedings, in a manner that will not shed much light on the whole of the background facts.

2. [8]

   Proceedings in this Court were commenced by Mr Zeene against Ms Dean in 2009 (No 288734 of 2009). At a time when both parties were legally represented, they came to an agreement to compromise the claim, and, on 11 April 2012, Stevenson J made orders by consent, including that the proceedings be dismissed.

3. [9]

   Extraordinarily, Ms Dean and Mr Zeene continued to engage in discussions in relation to the resolution of their dispute, and the result of their efforts was to agree to a series of short minutes of order, which they prepared without further legal advice, and which they caused to be filed in the Registry. In broad terms, each set of short minutes of order purported to replace the previous orders and to make new orders, not all of which appear to have been entirely rational. Apart from the orders made by Stevenson J on 11 April 2012, orders were made on 19 October 2012, 30 October 2012, 9 November 2012 and 18 February 2013.

4. [10]

   At the beginning of the hearing in these proceedings, which were commenced by Ms Dean against Mr Zeene to determine which of the orders made by the Court were effective, Ms Dean claimed that none of the orders made by the Court were valid and effective. Ms Dean apparently wished to secure a legal outcome whereby the respective rights of the parties under the partnership agreement were not affected by any of the arrangements for the compromise of the dispute between the parties embodied in the various orders made by the Court by consent. Mr Zeene contended for the validity of the 18 February 2013 orders. As will be explained, ultimately Ms Dean accepted that the 19 October 2012 orders ought to be accepted as the only effective orders. Mr Zeene then accepted Ms Dean’s position, apparently influenced by the realisation that the terms of the 18 February 2013 orders that were most favourable to him were based upon a significant and unsustainable conceptual error. Consequently, it will not be necessary for the Court to set out the terms of all of the different orders that the parties caused the Court to make. I set out the terms of the relevant orders below.

5. [11]

   For present purposes, it is necessary to understand that the 11 April 2012 orders made by Stevenson J established an agreed regime between the parties concerning the completion of the partnership venture and their respective responsibilities for the debt jointly owed to the partnership lender, the National Australia Bank, as well as certain subsidiary matters. All of the other orders contained different and sometimes inconsistent provisions on these subjects.

The 11 April 2012 orders

1. [12]

   On 11 April 2012, Stevenson J made the following orders in proceedings in this Court 288734 of 2009 by consent of Ms Dean and Mr Zeene. Both parties were legally represented. As mentioned above, Mr Zeene was the plaintiff and Ms Dean the defendant. The orders were:

2. [13]

   The Terms of Settlement referred to in the orders made on 11 April 2012 provided as follows:

The 19 October 2012 orders

1. [14]

   On 19 October 2012, the parties by consent filed further orders in the Court’s Registry without the assistance of lawyers. The orders were entered on 14 November 2012. They were as follows:

2. [15]

   The 11 April 2012 orders obliged Ms Dean to transfer her interest in Units 1, 2 and 4 to Mr Zeene, and he was required to transfer his interest in Unit 3 to Ms Dean. Of the outstanding debt of $1,250,000 owed by the parties jointly to the National Australia Bank, Mr Zeene was to refinance $500,000 and Ms Dean $750,000. That was to happen within six months. The 19 October 2012 orders repeated the requirement in the earlier orders for the transfer of the four units. However, both parties were to be separately equally liable for half of the debt owed to the National Australia Bank. It appears that Mr Zeene was to be compensated for his increase in the share of the debt by the terms of order 4. Under that order, in return for Mr Zeene’s promise not to pursue any claim for monies against Ms Dean’s mother (who I will call Mrs Dean for convenience), Ms Dean agreed to provide security to Mr Zeene over her home in Dulwich Hill to secure payment of an amount of $250,000. The orders acknowledged that Mr Zeene already had a caveat to protect the security. Order 5 recorded an agreement that Mr Zeene would lift the caveat in order to enable Ms Dean to raise finance on the security of the Dulwich Hill property to enable her to pay her share of the debt owed to the National Australia Bank.

Ms Dean’s statement of claim in these proceedings

1. [16]

   These proceedings were commenced on 2 April 2015 by Ms Dean filing a statement of claim. The defendant was Mr Zeene. Ms Dean filed an amended statement of claim on 21 August 2015. This was the last version of the statement of claim that was filed before the commencement of the hearing. The amended statement of claim seeks the following relevant orders:

2. [17]

   Ms Dean therefore, by a complicated set of orders, sought to establish that orders alleged to have been made by the Court on 18 February 2013, 11 April 2012, 19 October 2012, 30 October 2012, 7 November 2012, 8 November 2012 and 9 November 2012 were not valid or effective. The amended statement of claim was confusing, because there did not appear to be evidence that the Court had made orders on all of the dates referred to in the prayers for relief. The confusion may have arisen out of the fact that the parties were in possession of a set of orders bearing various dates without there being clear evidence that the Court had made orders on those dates.

3. [18]

   The hearing commenced on 27 March 2017. Ms Dean was given leave to file in Court a further amended statement of claim on 29 March 2017, the third day of the hearing. In the prayers for relief, prayers 1a, 3 to 9 and b, e, g to l, n and q were deleted. The rationale for the amendments is obscure. The deletion of prayers 1a and 3 still left the attack on the 18 February 2013 orders in prayer 1. Prayers 3 to 6 may have been deleted because there was some evidence that the parties never actually transferred their interests in the units to the other parties as required by the various orders. The deletion of prayers 7 to 9 meant there was no attack on the orders made on 11 April 2012. The deletion of the prayers that were designated by letters in some cases removed the attack on particular alleged orders, but in other cases removed some avenues of attack but left others on foot. It is possible that some of the prayers were deleted because it was realised that the Court may not actually have made orders on those dates. It does not appear that this confusion matters for the purpose of the resolution of the remaining issues.

Mr Zeene’s cross-claim in these proceedings

1. [19]

   Mr Zeene filed a cross-claim on 21 January 2016. Ms Dean was named as the first cross-defendant, and her mother, Ms Eileen Joan Dean (Mrs Dean) was named as the second cross-defendant. Mr Zeene sought the following orders:

2. [20]

   It may be noted at this stage that by orders 2 and 3 Mr Zeene made claims for money against Mrs Dean. That is contrary to order 4 made by the Court on 19 October 2012. The use of the expression “will in return” in order 4 (set out above at par 14) would support an argument that Mr Zeene, in making this claim against Mrs Dean, did not provide the consideration promised for Ms Dean’s agreement to give him security over her Dulwich Hill property for the payment of the $250,000. However, on the other hand, Mr Zeene filed his cross-claim in the context of Ms Dean including in her amended statement of claim prayers a to c, whereby Ms Dean sought orders that the 19 October 2012 orders made by the Court were not valid and effective. Thus, Mr Zeene did not act contrary to the 19 October 2012 orders until after Ms Dean had sought orders that they were not valid and effective.

3. [21]

   The pleading of Mr Zeene’s cross-claim made a substantial number of factual allegations concerning the relationship between Mr Zeene and Ms Dean and the history of the partnership. It finally referred to the making of the 18 February 2013 orders by consent, by way of a variation of the 11 April 2012 orders, in par 55. It did not specifically allege any breaches of the 18 February 2013 orders.

Mr Zeene’s amended cross-claim

1. [22]

   Mr Zeene filed an amended cross-claim on 11 February 2016. It seems likely from its form that it was prepared by Mr Zeene personally and without legal assistance. The pleading was prolix. Prayers 1 and 2 were substantially the same as in the initial cross-claim. Prayer 3 was changed to seek an order that Mrs Dean was liable for half of Ms and Mrs Dean’s mortgage from February 2007 to today. The meaning of this claim is unclear. Prayer 4 sought an order that Ms Dean and Mrs Dean “do all things and sign all documents nessasery [sic]” without identifying what was necessary. It seems likely that this document was not treated by the parties as an effective pleading, and was essentially ignored during the hearing.

2. [23]

   Ms Dean filed a defence to the cross-claim on 15 February 2016. The defence does not contain any specific pleading concerning the $250,000 agreement. It denied the allegation in par 55 of Mr Zeene’s defence concerning the making and effect of the consent orders on 18 February 2013.

3. [24]

   Mrs Dean filed a defence on 16 February 2016. It is not necessary to set out any aspects of this pleading.

4. [25]

   Mr Zeene filed an amended cross-claim on 24 March 2016. This was the version of Mr Zeene’s cross-claim that was in effect during the first stage of the hearing of these proceedings. It claimed the following relief:

5. [26]

   I have set out the prayers for relief in the amended cross-claim in full as it is necessary to understand the full ambit of the claims made by Mr Zeene when it comes to considering the issue of the costs of the proceedings.

6. [27]

   By prayers 2 and 4, Mr Zeene sought orders enforcing the final set of orders made by the Court on 18 February 2013. The parties’ references to a significant number of orders supposedly made by the Court and various deeds and agreements are mesmerising. I am not sure what the deeds referred to in prayers 3 and 5 are.

7. [28]

   The claims made by Mr Zeene in prayers 6, 11, 12, and 14 to 16 are material to the issue of whether Mr Zeene has failed to provide the consideration for Ms Dean’s agreement to grant him a security over the Dulwich Hill property to secure payment of the $250,000.

8. [29]

   By prayers 19 to 21 Mr Zeene sought orders relevant to the enforcement of Mr Zeene’s alleged rights under the original partnership agreement with Ms Dean.

9. [30]

   Paragraph 43 of the pleading in the amended cross-claim referred to the 19 October 2012 consent orders, but not in a way that is consistent with the wording of those orders. The paragraph includes an allegation that: “…The Cross-Claimant would then receive security against the Dulwich Hill property for the approximate value of 1 unit namely of up to $400,000.00. The First and Second Cross-Defendants would then borrow $250,000.00 against their assets in order to discharge the joint loan, which had been obtained in the sum of $200,000.00 plus interest from Ms Ruby Yam”. There is a further reference to the 19 October 2012 consent orders in pars 59 and 60. There is another reference to Ms and Mrs Dean being responsible to discharge the loan of approximately $250,000 from Ms Ruby Yam.

10. [31]

    Ms Dean filed an amended defence to Mr Zeene’s cross-claim on 2 May 2016.

11. [32]

    So far as regards the 19 October 2012 consent orders, Ms Dean, in par 43, denied the alleged $200,000 loan from Ruby Yam. Ms Dean alleged that the orders made on 19 October 2012 were superseded by a deed of agreement and charge dated 30 January 2013, and consent orders dated 8 November 2012.

Mr Zeene’s further amended cross-claim

1. [33]

   The hearing commenced before me on 27 March 2017 and ran until the end of 31 March 2017 when, being unfinished, the hearing was adjourned part-heard. Further hearing days suitable to the parties and the Court could not be found until 31 July 2017. The hearing then continued until 3 August 2017.

2. [34]

   During the course of the first stage of the hearing, counsel for Mr Zeene formulated and was given leave to file a further amended cross-claim, which was in fact filed on 5 May 2017.

3. [35]

   The prayers for relief in the further amended cross-claim significantly simplified Mr Zeene’s claim. They were in the following terms:

4. [36]

   The property referred to in prayer a was Unit 1 of the four units, which remained in the joint names of Ms Dean and Mr Zeene, even though Ms Dean had agreed to transfer her interest in that property to Mr Zeene under all versions of the consent orders made by the Court.

5. [37]

   Although the prayers for relief in the further amended cross-claim limited the relief claimed compared to earlier versions of the pleading, the facts pleaded continued to encompass much of the life history of the parties in so far as it related to the partnership and their relationship.

6. [38]

   While it is not necessary to set out the allegations made by Mr Zeene, it should be noted that in par 41e Mr Zeene maintained his allegation that, under the 19 October 2012 consent orders, Ms Dean agreed to provide Mr Zeene security over the Dulwich Hill property in the amount of $250,000 owed to Mr Zeene, and in par 41h that Mr Zeene was to discharge the caveat against the title to that property when he was paid the $250,000.

7. [39]

   The amount that Mr Zeene sought by way of damages and an account (notwithstanding that the latter remedy seems to have been deleted from the prayers for relief) appears to be substantial, although the manner in which the claim is expressed is incomprehensible.

Consent orders made in these proceedings

1. [40]

   On 2 August 2017, during the resumed hearing, it emerged that the parties had narrowed their differences and it appeared that it may be possible for them to agree on appropriate orders that could lead to the final resolution of the dispute.

2. [41]

   The Court gave the parties time to confer for the purpose of agreeing the terms of appropriate short minutes of order to give effect to their agreement in principle. Characteristically, the parties were not able to do so. Counsel for Ms Dean informed the Court (T96.35): “Your Honour, sadly the parties haven’t yet been able to come to an agreement. Tempers are fraying…”

3. [42]

   On the next day, in the hope of freeing the parties from their impasse, the Court made a list of the issues that were required to be dealt with and discussed those issues with the parties. When it appeared that there was a sufficient consensus, the Court adjourned in order to formulate draft short minutes of order, which became the orders made by consent. The draft was then provided to the parties on the following basis (T119.23):

4. [43]

   There was then further discussion between the Court and counsel for each party concerning the formulation of the orders, and after the parties were given time to consider the orders, they were made by consent in the following terms:

5. [44]

   The effect of orders 1 to 7 was that, of all of the orders made by the Court by the consent of the parties, and any agreements relevant to those orders, the only effective orders were those made on 19 October 2012, save that the orders 2 and 3 made by Stevenson J on 11 April 2012 dismissing the first proceedings, and as to the costs of those proceedings, were preserved.

6. [45]

   The declaration in order 8 had the effect that, by order 4 made on 19 October 2012, Ms Dean had agreed to pay Mr Zeene $250,000 in consideration of Mr Zeene agreeing not to pursue any claim against Mrs Dean, and Mr Zeene became entitled to an equitable charge over Ms Dean’s Dulwich Hill property to secure payment of the $250,000.

7. [46]

   Order 9 was made because of a propensity of Mr Zeene to lodge caveats against the title to Ms Dean’s Dulwich Hill property. Any caveat was required to confine Mr Zeene’s claimed interest to an interest in Ms Dean’s half-share in the title to the Dulwich Hill property, and was required to include a consent to the registration of a new mortgage to enable Ms Dean to pay her share of the debt that was owed jointly to the National Australia Bank.

8. [47]

   Orders 10 and 11 were included because the parties were not certain of the extent to which the orders made would finally dispose of all of the issues raised by the claims made by each of them. These orders were therefore made in ignorance of what might actually be preserved, which was a question reserved for a future hearing.

9. [48]

   The leave granted to Ms Dean by order 12 was intended to facilitate Ms Dean being able to obtain from the National Australia Bank all of the information relevant to the partnership debt that may be necessary to finally determine the amount owed by each party in respect of that debt, taking into account payments made by each party and the fact that the National Australia Bank had sold all of the units at Woy Woy at various times in exercise of its power of sale as mortgagee in order to reduce the amount of the debt. That did not apply to unit 1, which was agreed to be transferred to Mr Zeene, as the parties had excluded that unit from the security provided to the National Australia Bank.

10. [49]

    The purpose of orders 13 to 16 was to permit the parties to agree to the terms of the appointment of a referee to work out what the respective obligations were of the parties to repay the outstanding debt to the National Australia Bank.

11. [50]

    As it will be relevant to the resolution of the residual dispute that is now before the Court, I should record an explanation of the manner in which the orders made by the Court on 3 August 2017 were formulated, particularly in relation to the terms of order 8 concerning the $250,000 and the security over the Dulwich Hill property.

12. [51]

    As I have recorded above, during the course of the second stage of the hearing, both parties apparently realised that aspects of the cases that they were propounding were untenable. Initially, Ms Dean contended that none of the orders made by the Court ought to be enforced, while Mr Zeene supported the validity of the orders made on 18 February 2013. Neither party supported the validity of the consent orders made on 19 October 2012.

13. [52]

    A point was reached, on 1 August 2017, when Mr Zeene handed up a schedule of the orders and damages that he sought, which consisted of a refinement of the relief sought in his cross-claim. The document became MFI-3 (see T49.15).

14. [53]

    Relevantly, the schedule set out a claim that Ms Dean was required to pay Mr Zeene an additional $250,000 under the orders made by the Court in October 2012, February 2013 and in amended February 2013 orders. That was part of lists of the total amounts that Mr Zeene claimed were payable by Ms Dean under the different consent orders.

15. [54]

    Later, on the same day, Ms Dean handed up her own schedule of proposed orders, which became MFI-4 (see T59.31).

16. [55]

    Ms Dean’s schedule contained the following entries relevant to the $250,000 claim, in the column dealing with the effect of the 19 October 2012 consent orders:

17. [56]

    It is notable that Ms Dean’s schedule did not purport to preserve any argument that Mr Zeene had lost the right to pursue Ms Dean for the $250,000, because he had instituted proceedings against Mrs Dean, in circumstances where the consideration that he provided for Ms Dean’s obligation in respect of the $250,000 was that he would “no longer pursue any monies owed by Eileen Joan Dean”.

18. [57]

    The reason why Ms Dean included par 4 in her schedule does not appear clear. It may be noted that, although Mr Zeene had made claims against Mrs Dean in his cross-claim, by 3 August 2017 those claims had in practical terms ceased to be pursued.

19. [58]

    A review of the transcript following each party’s proffering of their schedules concerning the effect of the consent orders made by the Court on various dates shows that the Court was informed by Ms Dean on 1 August 2017 that she was content not to contest the validity of the 19 October 2012 orders, and would accept that none of the other orders were valid and enforceable (T71.13). Mr Zeene apparently then reconsidered his position and came to accept that the preferable way forward was for him also to accept the exclusive validity of the 19 October 2012 orders. This belated consensus had the effect that a significant number of issues over which the parties had strenuously fought evaporated. Considerable discussion between counsel for the parties and the Court then ensued in order to explore the consequences of this consensus in relation to the remaining issues. In effect, the Court facilitated an open discussion that was intended to allow the parties to resolve their dispute.

20. [59]

    In my view, it is clear from the transcript that the whole of this discussion took place on the basis that Ms Dean accepted that the effect of order 4 made by consent on 19 October 2012 was that Mr Zeene was entitled to lodge a caveat against the title to the Dulwich Hill property as a charge to secure payment of $250,000. Ms Dean did not accept that she had a personal obligation to pay that sum to Mr Zeene. Mr Zeene was required to withdraw the caveat, but only to enable Ms Dean to raise money on mortgage to pay out her various obligations, and, if she did not pay the $250,000 to Mr Zeene, he would be entitled immediately to lodge a further caveat.

21. [60]

    The Court observed (T51.39) that order 4 made on 19 October 2012 may have been an imperfect way of Ms Dean agreeing to pay another $250,000. Counsel for Ms Dean agreed. When asked by the Court whether it was Ms Dean’s case that she made that promise because she was misled or under undue influence, Ms Dean’s counsel responded that the suggested defence was not a point that he wished to make much of (from T51.39-52.3). He said (at T52.3) “That’s not a point…” Then, at T66.49 to T67.39, a discussion took place between the Court and counsel for Ms Dean in which the latter appears to have accepted that there was no evidence before the Court that would enable it to make any finding that Ms Dean had been misled or the subject of undue influence.

22. [61]

    Expressly, or as a matter of implication, the discussion leading up to the making of the consent orders proceeded upon the basis that the $250,000 was an existing obligation (albeit only recoverable by a charge over the Dulwich Hill property, and perhaps subject to the qualification that Mr Zeene did not make any new claim against Mrs Dean): see T67.40, 83.46, 84.9, 93.24, 96.39-.49, 122.46, 123.28 and 124.15-.16. Some of the exchanges are clearer than others. At T83.46, counsel for Mr Zeene, in explaining his view of the effect of accepting the 19 October 2012 orders, said: “Plus he’s got the good news that he’s entitled to an extra $250,000”. He was not contradicted. At T96.39-.49, counsel for Ms Dean was explaining what I understood to be his idea of the best way forward in the case by saying: “…Then there could be some security for the defendant’s 250, but the plaintiff from her part would need to have, be able to deal with her properties. There are currently caveats on her properties maintained by the defendant…and if he’d paid more than his share, then he would get the benefit of that surplus plus the 250, and if he’d paid less than his share, then he would have to deduct what he owes from the 250. What would be necessary is certainty for the plaintiff to have freedom to deal with her properties so that she can find some way out of this…” This seems to be an acceptance that the current effect of order 4 made on 19 October 2012 was that Mr Zeene was entitled to maintain a caveat against the title to the Dulwich Hill property to secure payment to him of $250,000.

Further consent orders

1. [62]

   Subsequently, on 8 September 2017, the following orders were made by consent for the purpose of implementing the taking of accounts between the parties:

The referee’s report

1. [63]

   Mr Lau delivered his report to the parties on 20 October 2017.

2. [64]

   On 6 December 2017, the Court gave the parties leave to agree short minutes of order to govern any dispute concerning the acceptance by the Court of the referee’s report.

3. [65]

   On 7 February 2018 the Court gave Mr Zeene leave to file a notice of motion in Court that sought the following relief:

4. [66]

   Ms Dean responded to this notice of motion by filing in Court on 23 February 2018 a notice of motion that sought the following relief:

5. [67]

   The Court fixed 26 April 2018 as the date for the hearing of the parties’ notices of motion. The parties did not complete the hearing on that date. It was not possible to give the parties a further hearing until 24 October 2018, on which date the hearing finished. However, the parties sought and were given leave to deliver to the Court further written submissions. Further written submissions were delivered by Ms Dean on 25 February 2019, by Ms Dean on 18 March 2019, by Mr Zeene on 4 March 2019 and by Mr Zeene on 2 April 2019.

6. [68]

   It has, unfortunately, taken the Court some time to process all of this material for the purpose of preparing its reasons for judgment, given the time spanned and by the proceedings, and the bulk of the material on the file. The parties accumulated hundreds of pages of transcripts, over a period since 2 April 2015. The difficulty faced by the Court has not arisen from the need to refresh that entire material, but from the need to find all of the information that remains relevant to the outstanding issues.

Principles governing adoption of referees’ reports

1. [69]

   The parties accepted that the relevant principles are as stated in Caska v Leigh [2018] NSWSC 466 by Ward CJ in Eq at [35]-[38] and in the following terms:

Discussion on adoption of referee's report

1. [70]

   In his written submissions dated 21 February 2018, Mr Zeene noted at [18] that the referee found that, as at 30 June 2016, the amount of the outstanding debt to the National Australia Bank was $382,710.11, of which Ms Dean was responsible for $327,612.56 (85.60%) and Mr Zeene was responsible for $55,097.55 (14.40%).

2. [71]

   Mr Zeene also noted in these submissions that the instructions to the referee required that he report as to the respective liabilities of the parties as at the date of the preparation of the account, which was 20 October 2017. Mr Zeene seems to accept, by par 22 of his 21 February 2018 written submissions, that the referee could not have been expected to prepare the report as at a later date than 30 June 2017. Mr Zeene surmised that the referee may have assumed that the parties' liabilities could not change over the next 12-month period after 30 June 2016. Mr Zeene noted that, if that assumption had been made by the referee, it was incorrect, as Ms Dean commenced making regular loan payments from 27 June 2016, which reduced the loan's outstanding balance from $382,710.11 at 30 June 2016 to $374,577.92 as at 30 June 2017.

3. [72]

   As I understand it, Mr Zeene submitted that this departure by the referee from his instructions does not matter, because the referee should have found that Mr Zeene fully discharged his share of the National Australia Bank loan by 6 July 2015, and that in fact Ms Dean is liable to reimburse Mr Zeene for a total of $32,965.90.

4. [73]

   As will be seen from the reasons that follow, I have not accepted Mr Zeene's submissions in the form in which they were originally put. Consequently, there may remain an outstanding accounting issue concerning changes in the responsibility for the debt owed to the National Australia Bank for the period after 30 June 2016. It will be necessary for me to return to this issue below.

5. [74]

   In accordance with the position taken by both parties, it will only be necessary for the Court to consider the adjustments that Mr Zeene submits should be made by the Court to the ultimate finding made by the referee. Otherwise, both parties have asked the Court to adopt the referee's findings.

6. [75]

   It will therefore not be necessary for the Court to review the reasoning in the referee's report in detail.

7. [76]

   It will, however, be necessary to make a number of observations about the instructions given to the referee and how the referee responded to those instructions.

8. [77]

   The terms of the order for reference are contained in order 3 made on 8 September 2017, which is set out above at par 62.

9. [78]

   The referee was instructed to start with the balance of the debt owed to the National Australia Bank on 11 April 2012. He was then instructed to prepare alternative accounts for the period 11 April 2012 to 18 October 2012. Those dates were respectively the date of the first set of orders made by Stevenson J and the date of the orders that the parties ultimately accepted are the operative orders. Alternative 1 reflected the position that would obtain over the period if the terms of the 11 April 2012 orders were effective; that is, Ms Dean was liable for $750,000 of the debt and Mr Zeene was liable for $500,000. Alternative 2 appears to have assumed that Ms Dean and Mr Zeene were equally liable for the debt over that period.

10. [79]

    As the first alternative involved an assumption that Mr Zeene was only liable for 40% of the debt, and thus 40% of the interest, it would be expected that the accounting would lead to the result that, at the end of the period, Mr Zeene would have paid off more of his share of the debt than would be the case for alternative 2, which assumed that he was equally liable with Ms Dean. That is because the amounts that should be credited to Mr Zeene's account in both cases would be the same, so Mr Zeene's final position would be expected to be better in the case of alternative 1 than the other alternative.

11. [80]

    The order for reference was prepared by the parties and not the Court, so the Court can only infer that the referee was given alternative instructions by the parties, so that the referee could provide alternative findings to the Court. Ms Dean would then be in a position to submit that the Court should find that alternative 2 reflected the correct position, while Mr Zeene would have contended for alternative 1.

12. [81]

    Order 3(c) instructed the referee to state two balances as at 19 October 2012, in response to the alternative assumptions given to him.

13. [82]

    Order 3(d) then required the referee to carry out an accounting from 19 October 2012 to the date the account was finalised. The assumptions given to the expert are consistent with the terms of the 19 October 2012 orders, in that both parties are assumed to be responsible for half of the debt and half of the interest charged.

14. [83]

    It is to be noted that the referee was instructed to carry out only one accounting on the assumption that both parties were liable for half of the debt outstanding as at 19 October 2012. Although the two alternative assumptions for the period 11 April 2012 to 18 October 2012 would be expected to yield different results as to the responsibilities of the parties for the debt at the end of the period, the referee was not instructed to carry out the accounting for the period from 19 October 2012 on alternative bases. As will be seen, that is consistent with the terms of the 19 October 2012 orders.

15. [84]

    Mr Zeene initially submitted that the referee's report should be adopted subject to four amendments, the first of which is the accounting issue I have referred to at par 71 above.

16. [85]

    The second error in the report claimed by Mr Zeene is that the referee did not carry forward a benefit Mr Zeene received from having a reduced liability for the National Australia Bank loan between 12 April 2012 and 18 October 2012. There does not appear to be a contest between the parties that, if Mr Zeene's claim is correct in principle, the amount of the credit to which he is entitled is $12,910.74. The relevant calculation is made in par 34 of Mr Zeene's 21 February 2018 written submissions.

17. [86]

    This reasoning is based upon the assumption that Mr Zeene's responsibility for the debt should, as a matter of principle, be calculated on the basis that the 11 April 2012 orders were valid and effective up to 18 October 2012; that is, that alternative 1 was the correct alternative. Ms Dean contests the correctness of this argument.

18. [87]

    It is to be noted that Mr Zeene did not claim that his liability for a share of the debt should be calculated for the subsequent period as if his liability at the beginning of the period was $12,910.74 less than the starting liability adopted by the referee.

19. [88]

    The effect of the alternative instructions given to the referee was that, once the referee had made the alternative findings, it was then a matter for the parties to argue before the Court as to which approach was the correct one.

20. [89]

    The determination as to which approach is correct depends, in my view, on the proper construction of the orders made by the Court on 19 October 2012.

21. [90]

    Mr Zeene argues that the 11 April 2012 orders were effective until 18 October 2012, and then the 19 October 2012 orders were effective for the subsequent period. Ms Dean contends that the effect of the 19 October 2012 orders was to retrospectively change the legal position of the parties as from the date of the initial orders. That is why alternative 2 required the assumption that the parties were equally liable for the debt owed to the National Australia Bank from 11 April 2012.

22. [91]

    In my view, the submission advanced by Ms Dean is the correct one. The orders are set out above at par 14. By order 1, the Court, by the consent of the parties, ordered that the terms of settlement dated 11 April 2012 "are now superseded". Order 6 provided: "We are both equally liable for the existing mortgage for $1,250,000.00 with the National Bank (Homeside)".

23. [92]

    The effect of the 11 April 2012 terms of settlement being superseded was that they ceased to have effect and were replaced by the terms of the 19 October 2012 orders. Moreover, the consequence of the parties agreeing that they were both equally liable for the existing mortgage meant that it ceased to be relevant whether or not one or other party owed less than the other because of the notional operation of the 11 April 2012 orders. The responsibility of each of the parties for the payment of the debt was in this way reset.

24. [93]

    I therefore do not accept that the second error claimed by Mr Zeene was made by the referee.

25. [94]

    The third error in the referee's report claimed by Mr Zeene is that the referee did not properly account for the net proceeds of sale of Lot 4.

26. [95]

    On 11 March 2014, Lot 4 was sold by the National Australia Bank exercising its mortgagee's power of sale. The sale price was $315,000, and the net proceeds of sale of $294,825.02 were paid in reduction of the loan. The referee credited the receipt to Mr Zeene, as he was the notional owner of Lot 4. The error claimed by Mr Zeene is that, although credit for the whole of the net sale proceeds was given to Mr Zeene, the referee continued to apportion the interest liability of the parties equally. Mr Zeene submitted that that was wrong because, as Mr Zeene's share of the loan had been reduced, he should have been responsible for a lesser proportion of the interest to reflect the reduction in his liability for the debt to an amount lower than 50%. The amount of the credit claimed by Mr Zeene is $9,033.22. Ms Dean does not challenge the calculation of the amount, but does contend that Mr Zeene is not entitled to this credit.

27. [96]

    I do not accept that Mr Zeene should be given credit for the amount claimed. While it is true that the referee continued to apportion interest between the parties, after crediting the net sale proceeds of Lot 4 to Mr Zeene, on the basis that the parties were equally liable to pay the interest, that is what the referee was specifically instructed to do by order 3(d)(iii) and (iv). Thus, the referee was instructed, by order 3(d)(ix), to credit the net proceeds of sale of Lot 4 to Mr Zeene, but he was instructed to continue to apportion the liability for interest on an equal basis.

28. [97]

    There may be scope for argument as to whether, on their proper construction, the 19 October 2012 orders had the effect that each party's liability for interest would be reduced proportionately if a party reduced the amount of the loan by the proceeds of sale of a unit owned by that party. There is obviously some sense in the orders being construed in that way. However, there is a reasonable argument that the agreement that the parties would be equally liable for the loan and interest etc. was intended to operate literally in accordance with its terms.

29. [98]

    Mr Zeene did not require the instructions given to the referee to provide that Mr Zeene’s proportionate responsibility for the interest should reduce, if one of his units was sold in order to reduce the amount of the total loan.

30. [99]

    As the reference was carried out in accordance with the instructions jointly given by the parties, it does not in my view remain open to either party to contend that the ultimate finding of the referee should be adjusted by the Court, to give effect to a construction of the 19 October 2012 orders that was not reflected in the instructions given to the referee.

31. [100]

    Particularly as the amount involved is only $9,033.22, I do not accept that Mr Zeene’s contention is consistent with the principles that govern the adoption of referee's reports.

32. [101]

    The final error that Mr Zeene initially claimed had been made by the referee has now been abandoned. I will therefore only provide a brief explanation of the submission made by Mr Zeene.

33. [102]

    The National Australia Bank sold Lot 2 for $415,000 and Lot 3 for $417,000 in mid-2015. The lots sold were nominally owned by Mr Zeene and Ms Dean respectively. The referee's report indicated that, on 6 July 2015, amounts of $397,597.24 and $283,876.20, giving a total of $681,473.44, were paid in reduction of the debt owed to the National Australia Bank.

34. [103]

    As the referee noted in his report, the parties were each given equal credit for the total reduction in the amount of the debt.

35. [104]

    Mr Zeene initially contended that the $397,597.24 in respect of the sale of Lot 2 should have been credited solely to him. He claimed that only the amount of $283,876.20 should have been credited to Ms Dean.

36. [105]

    The effect of Mr Zeene's argument appears from the Summary of Cash Flows for the period 12 April 2012 to 30 June 2017 that was annexed to his 21 February 2018 written submissions. On page 7 of that summary, Mr Zeene shows the effect of crediting $397,597.24 to his share of the debt, and $283,876.20 to Ms Dean's share of the debt on 6 July 2015. That is an adjustment to the schedule prepared by the referee, in which he gave credit to each of the parties for half of the total of the two amounts. The result of that change, if correct, would be that the whole of Mr Zeene's share of the loan was repaid on 6 July 2015, and there was an overpayment by him of $11,021.94.

37. [106]

    In par 50 of his initial written submissions, Mr Zeene surmised that part of the net proceeds of sale of Lot 3 that was not paid in reduction of the parties' debt was unaccounted for "and the only plausible explanation for what has happened to the funds is that the monies were applied in reduction of another debt the Plaintiff owed [the] NAB, or at the Plaintiff's direction".

38. [107]

    However, Mr Zeene's claim evaporated during the hearing, when a letter from the National Australia Bank's solicitors dated 5 April 2018 (Exhibit 1) was tendered. The letter established that the "unaccounted for" part of the net proceeds of sale of Ms Dean's Lot 3 constituted costs incurred of $116,232.40, which the National Australia Bank was entitled to recover under its mortgage. As it happened, the Bank chose to deduct the amount to which it was entitled wholly from the net proceeds of the sale of Ms Dean's Lot 3.

39. [108]

    As apportioning the Bank's costs between the two units would have the effect that the parties each contributed with approximate equality to the reduction in the loan, the result is that the assumption made by the referee, which he had to make in the absence of full evidence, was the correct one.

40. [109]

    Consequently, Mr Zeene had to accept that he was not entitled to a finding that he had repaid his share of the National Bank Loan by 6 July 2015. Nor was he entitled to the additional credit of $11,021.94 that he had initially claimed in respect of this alleged error by the referee.

41. [110]

    In these circumstances, the correct course for the Court to take is to adopt the referee's report in its entirety, noting the outstanding accounting issue.

Liability of Ms Dean to Mr Zeene for $250,000

1. [111]

   The last issue contested by the parties was whether Ms Dean is liable to pay Mr Zeene $250,000, and if she is, whether she ought to be ordered to pay that amount plus interest under s 100 of the Civil Procedure Act 2005 (NSW) to Mr Zeene.

2. [112]

   Ms Dean's potential liability to pay this amount to Mr Zeene arises out of order 4 made by the Court by consent on 19 October 2012, which is set out above at par 14. By that order, the Court noted an agreement between the parties, to the effect that Mr Zeene would no longer pursue any monies owed by Mrs Dean, and Ms Dean would in return provide Mr Zeene security against her Dulwich Hill property for $250,000. The agreement noted that Mr Zeene already had a caveat against the title to that property.

3. [113]

   By order 5, which appears to be partly in the form of an order and partly a notation of an agreement, Mr Zeene agreed to lift the caveat in order to permit Ms Dean to refinance the National Australia Bank Loan, and, if Mr Zeene received the $250,000, he was required to remove his caveat permanently.

4. [114]

   Ms Dean sought to argue that the agreement noted in order 4 was no longer binding, for two apparent reasons. First, by his cross-claim against Mrs Dean in these proceedings, Mr Zeene had claimed an entitlement to a money judgment against Mrs Dean. Ms Dean argued that the words “will in return", in order 4, had the effect that Mr Zeene's abstinence from suing Mrs Dean was the consideration for Ms Dean's agreement to provide security over her Dulwich Hill property for $250,000. According to Ms Dean, the effect of Mr Zeene suing Mrs Dean was that a condition of Ms Dean's liability was not satisfied; or alternatively, the consideration offered by Mr Zeene for the promise totally failed.

5. [115]

   Ms Dean also argued that the agreement noted in order 4 had ceased to be enforceable because Mr Zeene had continually declined to remove his caveat from the title to the Dulwich Hill property, and thus prevented Ms Dean from refinancing her liabilities.

6. [116]

   Mr Zeene responded to this claim in a number of ways. The first way was to argue that the Court should not deal with this issue, as it was not formally before the Court.

7. [117]

   The notice of motion that was filed by Ms Dean is set out above at par 66. As this issue was not dealt with in the referee's report, it follows that the notice of motion did not seek any order declaring that Ms Dean was not liable to Mr Zeene for the $250,000.

8. [118]

   On the other hand, prayers 5 and 7(a) of Mr Zeene's notice of motion, which is set out at par 65 above, claim an order that Ms Dean pay Mr Zeene $250,000 (prayer 5 includes that claim in the $282,965 referred to). Thus, the issue sought to be raised by Ms Dean was responsive to a claim made by Mr Zeene.

9. [119]

   Nonetheless, Mr Zeene submitted, Ms Dean has never pleaded that her promise in respect of the $250,000 has been vitiated on the basis of a failure of a condition, or a total failure of consideration. Mr Zeene pointed, in par 28 of his written submissions in reply, to the fact that, in pars 21 to 29 of Ms Dean's amended and further amended statements of claim, she had pleaded that she entered into the agreement on the basis of an untrue representation that she owed Mr Zeene $250,000, that the representation was made fraudulently, and, in addition, that Mr Zeene used undue influence to obtain her agreement to pay her the $250,000. Mr Zeene’s point was that, although Ms Dean had attacked the validity of her promise to pay Mr Zeene $250,000, the attack was not on the ground of failure of a condition or total failure of consideration.

10. [120]

    I have set out the prayers for relief in Ms Dean's amended statement of claim in par 16 above, and noted the amendments made in the further amended statement of claim in par 18 above. In prayers a to c, Ms Dean sought orders to establish the invalidity of the 19 October 2012 orders, but she did not, in terms, seek any declaration that the agreement noted in order 4 had been voided on the ground of a failure of a condition or a total failure of consideration.

11. [121]

    On the other hand, when Mr Zeene's pleadings are considered, he also has not claimed any relief enforcing the promise by Ms Dean in the agreement noted in order 4 made on 19 October 2012.

12. [122]

    By Mr Zeene's original cross-claim, considered at par 19 above, he sought an order that Ms Dean comply with the orders made by the Court on 18 February 2013; not those made on 19 October 2012.

13. [123]

    The prayers for relief in Mr Zeene's amended cross-claim are set out above at par 25. Again, no order was sought enforcing the 19 October 2012 orders, and there is no specific mention of Mr Zeene's claim for $250,000 against Ms Dean.

14. [124]

    The final set of orders sought by Mr Zeene was contained in his further amended cross-claim. The prayers made in that pleading are set out in par 35 above. There is no claim to enforce Ms Dean's promise to pay Mr Zeene $250,000.

15. [125]

    Consequently, the claims for relief in prayers 5 and 7(a) of Mr Zeene's 7 February 2018 notice of motion are not supported by his pleadings.

16. [126]

    Nonetheless, the parties did contest the issue at the hearing and in their sundry written submissions.

17. [127]

    If it were necessary to decide the issue, then difficult considerations would arise. Although it is true that Mr Zeene made money claims against Mrs Dean, as I have noted in par 20 above, that was in the context that Ms Dean, by her claim, had sought orders to the effect that the 19 October 2012 orders were ineffective. Mr Zeene put the argument that the fact that he had made claims against Mrs Dean should not have the effect of undermining the agreement recorded in order 4 made on 19 October 2012, because Ms Dean had herself first repudiated the agreement by seeking orders to establish that it was invalid.

18. [128]

    I do not think it is necessary for the Court to attempt to resolve this difficult issue, which was not the subject of full argument by the parties. The reason is the making of order 8 by the Court by consent of the parties on 3 August 2017. That order is set out in par 43 above.

19. [129]

    Order 8 was a declaration that the effect of order 4 made on 19 October 2012 was that Ms Dean became indebted to Mr Zeene to pay him $250,000, in consideration of Mr Zeene agreeing not to pursue any claim against Mrs Dean, and Mr Zeene became entitled to an equitable charge over Ms Dean's Dulwich Hill property to secure payment to him of the $250,000.

20. [130]

    I have set out above at pars 50 to 61 the events that occurred during the hearing that led up to the consent orders being made on 3 August 2017.

21. [131]

    Although order 8 noted that Ms Dean's promise to pay Mr Zeene $250,000 was in consideration of Mr Zeene agreeing not to pursue any claim against Mrs Dean, as I understood Mr Zeene's case as at 3 August 2017, he had ceased to pursue against Mrs Dean the claims against her that he had made in his cross-claim. The parties did not ask the Court, by the 3 August 2017 orders, to grant any relief on any claim made by Mr Zeene against Mrs Dean.

22. [132]

    As I understood the position taken by Ms Dean, particularly as discussed in pars 54 to 61 above, Ms Dean accepted as part of the discussions leading up to the making of the orders that she was liable to Mr Zeene for the $250,000.

23. [133]

    I note again that order 10 made on 3 August 2017 was a notation that the orders made may not have disposed of all of the issues in dispute between the parties, and that it might be necessary for additional issues to be identified and appropriate directions made for their determination.

24. [134]

    Order 11 reserved the question of whether the parties should be permitted to seek any further substantive relief, and, if so, what the relief should be, for further determination by the Court upon application by the parties.

25. [135]

    Although Ms Dean raised the arguments set out above as to why she is not liable to pay Mr Zeene $250,000, in response to the claim made by Mr Zeene in his notice of motion, which was not itself supported by the pleading of his cross-claim, Ms Dean has not made any application under orders 10 and 11 made on 3 August 2017.

26. [136]

    In all of these circumstances, the only practical course open to the Court is to decline at this stage to rule on Mr Zeene's claim for an order that Ms Dean pay him $250,000. It is not a claim made by him in his cross-claim. On Ms Dean's part, she has not applied for an order permitting her to contend that her promise is no longer enforceable.

27. [137]

    For the reasons that I have discussed in detail above, concerning the circumstances in which the 3 August 2017 orders were made, it may be unlikely that the Court would accept that the point that Ms Dean wishes to argue remains open.

28. [138]

    The Court has made order 8 with Ms Dean's consent, and it is a matter for Mr Zeene to seek to enforce the order by some properly constituted proceeding which may include seeking an order for the sale of the Dulwich Hill property, in order to give effect to the equitable charge created by order 8. It may be a matter for Ms Dean to raise any issue that she claims remains outstanding in her opposition to any relief claimed by Mr Zeene.

Parties’ liability for debt owed to Mr Diab

1. [139]

   Order 7 made by the Court by consent on 19 October 2012 was in the following terms: “We are both equally liable for Simon Diab’s legal cost of $60,000.00.”

2. [140]

   The effect of order 5 made by the Court on 3 August 2017, which declared the continuing validity of the 19 October 2012 orders, was to give force to order 7 made on 19 October 2012.

3. [141]

   Mr Diab swore an affidavit in these proceedings on 29 June 2018. The affidavit was read by Mr Zeene. He said that he acted for Mr Zeene in his dispute with Ms Dean concerning the Woy Woy joint venture between 14 September 2010 and approximately October 2012. By October 2012, Mr Diab was owed approximately $100,000 in legal fees by Mr Zeene. Mr Diab and Mr Zeene agreed in October 2012 that Mr Diab would compromise his claim at $60,000 if paid within 30 days. The $60,000 was not paid within 30 days. Subsequently, on 19 August 2013, Mr Diab obtained a Local Court judgment against Mr Zeene for $106,613.68. Following certain other recovery steps taken by Mr Diab, in April 2017 Mr Zeene granted a mortgage over Lot 1 at Woy Woy to secure his obligation under the judgment to Mr Diab. As at the date of Mr Diab’s affidavit, the full amount owing by Mr Zeene was $178,248.68 which included interest and additional costs. The debt is increasing by $44 per day. Mr Diab will not compromise this claim, as it is fully secured by Lot 1.

4. [142]

   Prayer 6 of Mr Zeene’s notice of motion filed on 7 February 2018 seeks an order that Ms Dean pay to Mr Zeene “…such moneys as she is held liable to pay [to] Simon Diab together with interest on such moneys.”

5. [143]

   In par 68 of his 21 February 2018 written submissions, Mr Zeene submitted that, as he lost the opportunity to compromise Mr Diab’s claim by paying him $60,000, because Ms Dean did not pay her $30,000, Ms Dean should be ordered to compensate Mr Zeene for the value of his lost opportunity, which Mr Zeene calculated as being the current principal of the debt, being $118,758.01, and the amount of $30,000 that was payable by Ms Dean under order 7 made on 19 October 2012. Alternatively, Mr Zeene submitted, in par 69, that Ms Dean should be ordered to pay him $30,000 towards the discharge of his liability to Mr Diab plus interest.

6. [144]

   There is, so far as I am aware, no evidence that, at the time Ms Dean agreed to contribute equally to what appeared to be a $60,000 debt to Mr Diab, she had been made aware that the $60,000 was a compromise, and that, if payment was not made within the 30-day period that Mr Zeene had agreed with Mr Diab, Mr Zeene would be liable to pay a much greater amount to Mr Diab. Lot 1 was not the subject of a mortgage to the National Australia Bank, and there does not appear to be any evidence that explains why Mr Zeene did not avail himself of the value of Lot 1 to pay the compromise amount that he had agreed with Mr Diab. Mr Zeene did not refer to any such evidence in his submissions.

7. [145]

   The effect of order 7 made on 19 October 2012, according to its terms, was to make Ms Dean and Mr Zeene equally liable for the debt owed by Mr Zeene to Mr Diab, but it also quantified the obligation of Ms Dean as being half of $60,000. It is clear that Ms Dean must be ordered to pay Mr Zeene $30,000, plus interest under s 100 of the Civil Procedure Act 2005 (NSW). The evidence does not, however, establish that Ms Dean was made aware of the consequences of Mr Zeene not complying with the compromise agreement, which would be necessary before Ms Dean could be held liable for any part of the debt above $60,000, on the basis that it was within the contemplation of the parties, on 19 October 2012, that Mr Zeene’s obligation to Mr Diab would increase if Ms Dean did not pay her $30,000 within 30 days.

8. [146]

   Accordingly, the only order that should be made against Ms Dean is that she pay Mr Zeene $30,000, plus interest at the Court’s rate from 19 October 2012.

Orders

1. [147]

   Unfortunately, the finding that the Court should adopt the referee’s report does not conclude the accounting issue, as the referee only determined the parties’ shares of the debt owed to the National Australia Bank as at 30 June 2016. The Court does not know what is involved in extrapolating that finding to the date on which the debt may finally be repaid.

2. [148]

   The Court can only hope, in the interests of both the Court and the parties, that the extrapolation is a straightforward one, or, if there are any difficulties, that the parties finally realise the benefit of sensible compromise in relation to relatively minor issues.

3. [149]

   The Court must ask the parties to submit to my associate draft short minutes of order to give effect to these reasons for judgment. I am not confident that the parties will cooperate or reach any agreement, but the Court needs their assistance in determining the final orders to be made. If contending short minutes of order are submitted, I will decide what orders should be made.

4. [150]

   The final issue that I briefly make note of comes from a statement made in the written submissions of the plaintiff dated 25 February 2019, on page 9, as follows: “The one error is the NAB Bank Expenses taken without notice following the sale of Lots 2 & 3.” At page 10, the plaintiff goes on to state that: “The Lau Report should be adopted without variation…Note the difference between the Lau Report and Annexure “A” is the correction of NAB Bank Expenses for sales of Lots 2 and 3.” To the limited extent that what these submissions refer to is a clear, agreed arithmetic error in the Lau Report, which both parties have agreed at all relevant times should be corrected, the parties are welcome to include an order that reflects this consensus in their draft short minutes of order.

Costs

1. [151]

   As I have recorded above, Ms Dean's position is that the parties should be required to bear their own costs of these proceedings. However, as Mr Zeene has asked to be permitted to make submissions on costs, the requirements of procedural fairness prevent the Court from making any summary order for costs without hearing from Mr Zeene.

2. [152]

   It would be wise for the parties to think carefully before they seek an order that the other party pay some or all of their costs. One of the reasons why I have set out the prayers for relief in each party's pleadings in some detail above, was to expose the fact that the effect of the parties' agreement that the 19 October 2012 orders were the effective orders has been that the ultimate result of the proceedings is entirely inconsistent with the orders originally sought by both parties. Both parties have sought different forms of complex relief at various times, and most of those claims have come to nothing.

3. [153]

   It would take an extraordinary amount of work for the parties to prepare submissions in the detail necessary before the Court could even think of embarking on the exercise of attempting to judge the differential responsibilities of the parties for all of the costs that have been incurred. While it is entirely a matter for the parties, the exercise is likely to be quixotic and self-defeating. Any failed attempt by one party to impose the cost burden of the proceedings on the other is likely to be visited with a contrary costs order.

4. [154]

   The parties should also remember that Mr Zeene has failed in his attack on the referee's report, and Ms Dean has failed to establish that she is not liable to pay Mr Zeene the $250,000 that she agreed to pay him.

5. [155]

   It is incomprehensible, in the circumstances, why the parties did not lay down their arms and accept the effect of the 3 August 2017 orders, and the referee's 20 October 2017 report, soon after they were made.