FEDERAL COURT OF AUSTRALIA

Wharton v Derwent Valley Council [2009] FCA 791

Pembroke School Incorporated v Human Rights and Equal Opportunity Commission [2002] FCA 1020, referred to

SZCZF v Minister for Immigration and Citizenship [2009] FCA 208, referred to

GEOFFREY WHARTON v DERWENT VALLEY COUNCIL and DERWENT VALLEY INVESTMENTS PTY LTD (ACN 08 674 8692)

TAD 19 of 2003

MARSHALL J

27 JULY 2009

HOBART

THE COURT ORDERS THAT:

1.         The Applicant’s motion filed on 29 May 2009 is dismissed.

2.         The Applicant pay the Respondents’ costs, to be taxed in default of agreement.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using eSearch on the Court’s website.

REASONS FOR JUDGMENT

1                          The applicant, Mr Wharton, applies by motion to set aside a consent order made by Heerey J on 6 April 2005. That consent order states:

1.    That judgment be entered for the first respondent and second respondent against the applicant.

2.   That the applicant pays the first respondent and second respondent’s taxed costs in this action.

2                          Mr Wharton now contends that the consent order was obtained by fraud. He says it should be set aside and an order made for the reinstatement of proceeding TAD 19 of 2003; see O 35 r 7(2) of the rules of Court. The motion was filed in TAD 19 of 2003. It may, more appropriately, have constituted a separate proceeding; although nothing material turns on this. See Pembroke School Incorporated v Human Rights and Equal Opportunity Commission [2002] FCA 1020 at [22] per Mansfield J.

3                          Mr Wharton submits that there is new evidence available which leads to the conclusion that the respondents perverted the course of justice. The new evidence is said to be that contained in a statutory declaration of a “key witness”. Mr Wharton says that the new evidence shows that the respondents misled and deceived the witness in order to harm Mr Wharton’s legal rights. Mr Wharton also says that the new evidence shows that the respondents turned the witness hostile against Mr Wharton.

4                          The relevant witness is Mrs Barbara Adams. In his substantive application, the subject of the consent order, Mr Wharton asserted that the respondents had taken his work in respect of a tourism proposal and had announced a proposal from Mrs Adams bearing a striking similarity to his proposal. In a statement filed in support of his original application, Mr Wharton said that he had met with Mrs Adams who told him, and others, that she had been approached by the respondents concerning the project. The inescapable inference from that statement is that Mr Wharton suspected strongly that Mrs Adams did not have her own plans for a tourism development but was being used by the respondents.

5                          In his affidavit in support of his current motion at [9(v)], Mr Wharton states that he:

was running an enormous risk by allowing the matter to proceed into a full hearing as he could not prove before the court if Mrs Adams had her own plans or not, unless he had her under cross examination, but everything was based upon his educated hunch she did not have any plans of her own and by the nature of the plans they were so close to the Applicant, he could only suspect they had been given to her, but could not prove that at that time and he could not get to meet with her.

…The Applicant ordered his Pro Bono legal counsel to withdraw the matter and left the details to the legal counsel on the first day of the full hearing as at that time the financial risk was enormous without this hole being covered in the action.

6                          Mr Wharton says that Mrs Adams now admits she had no plans of her own. The fact that the respondents approached Mrs Adams and not the other way around strongly suggests that Mrs Adams had no plans of her own, if all that evidence is accepted. This fact would have been elicited by truthful answers being given under cross examination by Mrs Adams, had Mr Wharton called her and, if necessary, applied to have her treated as a hostile witness. Alternatively those answers may have been obtained in examination in chief.

7                          In 2005, Mr Wharton made a forensic decision not to proceed with his application largely because of uncertainty as to what Mrs Adams might say. Such uncertainty is the essence of litigation. Even if the respondents blackened Mr Wharton’s name in Mrs Adams’ eyes that does not affect the duty she had to give honest answers to questions which were relevant based on Mr Wharton’s statement that the respondents approached Mrs Adams with a development proposal and not the other way around.

8                          There is, in reality, no new evidence, but a situation where there is now a greater certainty about evidence which could have been given in 2005 had Mrs Adams been called to give such evidence.

9                          Mr Wharton’s forensic decision to abandon his application in 2005 was not induced by fraud but by an assessment by him that he could not be certain of a fact, which he now believes to be beyond dispute based on Mrs Adams’ recent admissions. The motion falls at its first hurdle in that the consent order itself was not affected by fraud but by an assessment made by Mr Wharton about what he could prove at the time. In retrospect the assessment turned out to be wrong and timid. That assessment was not affected by any fraud committed by the respondent but rather by a decision made by Mr Wharton concerning his risks in litigation.

10                        There can be no way of knowing whether the evidence which may have been called would necessarily have led to Mr Wharton’s success in the proceeding. It is impossible to determine how the issue of loss would have been resolved. Also, the evidence of Mrs Adams may have been put in issue by the respondents. The Court will never know. Although it seems from the affidavit of Mr Mackey of the first respondent, sworn in March 2005, that the respondents intended to assert that the Wharton and Adams proposals were unrelated.

11                        This raises the issue of the difficulty in setting aside an order obtained by consent. There is no considered judgment of the Court to use as a yardstick to assist in determining what might have occurred; see SZCZF v Minister for Immigration and Citizenship [2009] FCA 208, where Flick J discussed other difficulties in setting aside a consent order.

12                        There is also the difficulty of the delay between the consent order in 2005 and this application some four years later. The reason for the delay is not satisfactorily explained by Mr Wharton. The evidence which is said to be new could have been adduced with appropriate questioning and the exercise of reasonable diligence by him at the trial.

13                        For the foregoing reasons the applicant’s motion is dismissed with costs, to be agreed or taxed in default of agreement.

Associate:

Dated:         28 July 2009