Davis by her tutor the Protective Commissioner of NSW v Willis & Anor

HIS HONOUR : The plaintiff, who is the applicant in this motion, was badly injured in a motor car accident which occurred in 1971. At the time of the accident she was under the age of 18 years and proceedings were bought by her tutor claiming damages against the first and second defendants, who are the named respondents to the motion before me. The motion has been served on the first defendant ut not the second defendant. These proceedings are concerned with the means of service on the second defendant.

The original proceedings did not come on for hearing until 13 May 1987. By that day the plaintiff's age was greater than 18 years and accordingly it was unnecessary for her by reason of her age to bring proceedings by her tutor.

The Supreme Court file on the matter is not complete and I have been informed by agreement that there are few records which can be accessed of the respective solicitors. However, the Supreme Court file indicates that in November 1986 an order was made that the proceedings be heard in Tamworth. The file does not in the conventional way record the fate of those proceedings. However, the parties have been able to retrieve a memorandum of costs charges and disbursements prepared by JJ Lyons and Barnett Solicitors, dated 17 June 1987, who were acting for the plaintiff at the relevant time.

That memorandum in the conventional way carries a history of the work which the solicitors had undertaken and includes the following: “... arranging for Counsel to appear in the Supreme Court for the matter to be listed at Armidale [plainly a reference to the application made before Maxwell J], receiving an offer of $150,000 plus legal costs, conference with your mother and with Mr Christie of counsel, letter to Solicitors for the Defendant declining the offer but indicating preparedness to accept a lower amount, arranging for matter to be transferred to the Supreme Court sittings in Tamworth, in May 1987, further correspondence concerning attempts that were being made to settle the matter, commencing to prepare for Hearing, attending you receiving instructions to proceed with it plus such legal costs as the defendant was required to pay, receiving offers from the Defendant of various amounts and refusing those offers, preparing the matter for Hearing but then receiving acceptance of the offer of $250,000 plus most of the costs which we had put, correspondence with you following the settlement, obtaining Birth Certificate, receiving Terms of Settlement, signing same, attending Tamworth Supreme Court when an order was made discharging the tutor and for a verdict in Maria's favour..."

Thereafter the evidence discloses that the verdict sum of $250,000 was paid by the defendants and the plaintiff's solicitors accounted to her for that amount, less an amount for their costs.

The defendants were represented by the firm of solicitors Abbott Tout Creer and Wilkinson and it is apparent that pursuant to the regime of compulsory third-party insurance which existed at the time, they were acting for an insurance entity which would have been the NRMA Insurance.

The original copy of the terms of settlement has survived on the Supreme Court file. It is signed by counsel for the plaintiff and a solicitor for the defendant and is dated 13 May 1987. There was no issue in relation to liability which had previously been admitted, the settlement being reached with respect to the appropriate quantum of damages.

The plaintiff has now brought a motion which has been filed in the original proceedings. It seeks orders, inter alia, that the terms of settlement filed on 13 May 1987 be set aside. It also seeks an order that there has been proper service of the notice of motion, referred to as the amended notice of motion. I understand that to be a claim that there has been service as provided by Pt 10 r 10.5(1)(b)(i) of the Uniform Civil Procedure Rules 2005.

In the alternative to that order, an order for substituted service of the amended notice of motion is sought. The appropriate recipient of the substituted service, being identified as Insurance Australia Ltd, which is the name of the corporation which has acceded to the business of NRMA Insurance.

The issues before me today are, firstly, whether or not by serving Abbott Tout solicitors the plaintiff has effected service of the notice of motion. If I am satisfied that that service has not been effected, the plaintiff asks that I consider the motion for an order for substituted service.

Critical to the resolution of the matter with respect to Abbott Tout is the nature of the agreement which was reached in settlement of the matter and whether or not that agreement, having been entered into and the relevant moneys paid in discharge of the obligation, there is a capacity for the plaintiff now to seek to reopen those proceedings. Unless that can be done Abbott Tout have no relationship to the proceedings.

It is submitted that because, at the relevant time, the plaintiff, although she had ceased to be a minor, was nevertheless relevantly a disabled person as provided by Pt 63 r 2 of the Supreme Court Rules as they existed at that time, and as the settlement was not approved by the Court it is not effective and binding upon the plaintiff.

The foundation for that submission is evidence which I have received from medical practitioners indicating that in their opinion at the time of the settlement the plaintiff would have been suffering from a significant intellectual impairment.

It is submitted that in those circumstances I should now find that the plaintiff was relevantly disabled with the consequence that any settlement of her claim was required to be approved by the Court pursuant to s 4 of the Damages (Infants and Persons of Unsound Mind) Act 1929. Without that approval it is submitted the proceedings continue.

It is also submitted that although there is no evidence which would indicate that, if required, the approval of the Court was not given (the evidence is silent on that matter), I should now assume that an error was made at the time and that approval was in fact not given.

I have also been informed by the plaintiff's counsel that although these proceedings have been brought in an attempt to reopen the Supreme Court litigation, separate proceedings have been commenced against the solicitor and counsel who acted for and advised the plaintiff when the matter was compromised. It is apparent that the terms of the settlement were executed by the legal representatives of the plaintiff and the legal representative of the defendants. Furthermore, there is no question that the plaintiff’s solicitor and barrister were authorised to enter into that agreement. It is also apparent that the agreement was performed, the obligation for the defendants to make the payment has been discharged and the moneys have been accounted to the plaintiff.

In these circumstances the agreement between the parties has been perfected and is now complete. The question is whether in these circumstances it is open to the court to set that agreement aside in the event that the plaintiff is able to persuade the Court that orders were improperly made.

Counsel for the plaintiff referred to the decision of the House of Lords in Dietz v Lennig Chemicals Limited [1969] 1 AC 170 where the question was whether or not an agreement pursuant to which moneys had not been paid but orders had been entered should be set aside when it became apparent that the foundation for the agreement and its approval by the Court was not as the legal practitioners had assumed. Apparently, the plaintiff had apparently married before the relevant date which should have impacted or could have impacted upon the quantum of any award.

That case seems to me quite different to the present. In that case the agreement had not been perfected by payment and accordingly the Court was able to entertain an application to set the order aside.

There are two other significant features of the present case. Firstly, the solicitor’s note evidences the fact that at the time the Court made orders in accordance with the terms of settlement the tutor, who had previously been appointed, was discharged. Although there is no evidence that the Court was made aware of any intellectual difficulties which the plaintiff faced, it is inconceivable having regard to the nature of the claim that the plaintiff's legal representatives and the defendants’ representatives were not aware of the fact she had suffered significant injuries.

Accordingly, if any question arose at that time as to the capacity of the plaintiff the obligation fell upon the legal practitioners to inform the Court of that problem so that the appropriate course could be taken.

I have already adverted to the second matter. If approval was necessary, there is no evidence that it was not given. In my opinion unless there is evidence to the contrary there is no reason to assume that any necessary steps for a valid order to be made were not taken.

In these circumstances it must follow that the plaintiff would be unable to successfully move to set aside the orders, which the Court made. It follows that the proceedings are at an end. Accordingly, I could not find that the present motion has been effectively served on the second defendant by service upon Abbott Tout.

It is strictly unnecessary for me to consider whether the motion can be effectively served by service upon Insurance Australia Ltd. However, it seems to me that the assumption upon which that claim is based is flawed. In Chappell v Coyle (1985) 2 NSWLR 73, Yeldham J held that where service of a document is required an order for substituted service can only be made where it can be demonstrated that it is likely the document will come to the notice of the person to be served. In that case his Honour held that without more, service on the insurance company would not effect service on the insured. So much is reflected in the form of the rule in Pt 9 r 10.1A of the Supreme Court Rules.

There being no evidence that Insurance Australia Ltd has any knowledge of the whereabouts of the second defendant, there is no reason to assume that service upon Insurance Australia would be effective to serve him. Accordingly, even if the primary proceedings remain on foot, it seems to me that I could not make an order for substituted service on Insurance Australia Ltd.

As I had previously indicated the plaintiff today sought orders 3, 4 and 5 in the amended notice of motion. I formally decline to make those orders and to that extent the motion is dismissed.