FEDERAL COURT OF AUSTRALIA

Modra v State of Victoria (Department of Human Services Victoria & Department of Education and Early Childhood Development) [2013] FCA 1041

THE COURT ORDERS THAT:

1.    Pursuant to Rule 9.70 of the Federal Court Rules 2011 (Cth), the settlement between the parties recorded in the Deed of Release exhibited as EM-1 to the affidavit of Ellen Modra, sworn on 9 October 2013, be approved.

2.    The affidavit of Ellen Modra, sworn on 9 October 2013, and the exhibits thereto, be treated as confidential and placed in a sealed envelope marked “NOT TO BE OPENED WITHOUT THE PERMISSION OF A JUDGE OF THIS COURT.”

3.    The principal application be dismissed.

4.    The Respondent pay the Applicant’s costs, in the sum specified in paragraph 1.5 of the Deed of Release, incurred for the purpose of obtaining the Opinion of an Independent Lawyer as required by Rule 9.71 of the Federal Court Rules 2011 (Cth). Otherwise there be no order as to costs.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

1    Mr Luke Modra suffers from profound autism spectrum disorder (“ASD”), an intellectual disability and occipital lobe epilepsy.

2    Between 2000 and 2010 Mr Modra attended a school and lived in assisted accommodation which were conducted and provided by agencies of the State of Victoria.

3    In 2010 Mr Modra, acting through his mother and litigation representative, Ms Ellen Modra, commenced the present proceeding. He alleged that he had been directly and indirectly discriminated against by the State agencies in contravention of provisions of the Disability Discrimination Act 1995 (Cth) (“the Act”). These alleged contraventions related to requirements that he take certain medication, the constraints placed on him while travelling on a bus to and from school, the failure to provide certain educational facilities and the imposition of physical restraint and periods of seclusion on him at school. He made further claims that the State had contravened certain provisions of the Disability Standards prescribed under the Act.

4    The interlocutory stages of the proceeding before Gray J were beset by a series of successful pleading objections by the State to Mr Modra’s statement of claim. Many of these objections were upheld by his Honour and, despite his Honour identifying the shortcomings in Mr Modra’s statement of claim and providing guidance as to how those shortcomings might be rectified, attempts at re-pleading failed to overcome some of the manifest deficiencies. An account of these interlocutory disputes and their resolution is to be found in Modra v Victoria (2012) 205 FCR 445.

5    From the outset the State has steadfastly maintained that it has not committed any contravention of the Act.

6    The proceeding was referred to a Registrar of the Court for mediation. The issues between the parties were resolved at mediation. In the course of the mediation the parties agreed on terms of settlement. These terms of settlement were recorded in a Deed of Release.

7    Rule 9.70(1) of the Federal Court Rules 2011 (Cth) (“the Rules”) required Ms Modra, as litigation representative, to apply to the Court for approval of the terms of settlement. Her application was accompanied, as required by Rule 9.71(2), by:

    An affidavit sworn by her on 9 October 2013;

    A copy of the deed of release; and

    The written opinion of counsel to the effect that the agreement reflected in the deed was in the best interests of Mr Modra.

The material facts relevant to the application were set out in counsel’s advice. Ms Modra deposed to the accuracy of these facts.

8    Neither Mr or Ms Modra was legally represented. This gave rise to some difficulty. Rule 9.71(2)(c) requires that any application for approval of a settlement agreement must be accompanied by “an opinion of an independent lawyer that the agreement is in the best interests of the person under a legal incapacity.” Ms Modra sought the appointment of such a lawyer under the Court’s pro-bono scheme. She proposed that, subject to his agreement, the advice of a barrister who had acted for Mr Modra at earlier stages of the proceeding should be sought pursuant to a referral certificate for legal assistance under the scheme. This raised an issue as to whether the nominated barrister could be regarded as “independent” for the purposes of Rule 9.71.

9    I took the view that the proposed referral was appropriate. I did so having regard to the observations of Bromberg J in Wade v State of Victoria (No 2) [2012] FCA 1080 at [9] where his Honour said:

“There is ambiguity as to what the word “independent” in r 9.71(2)(c) intends. I doubt that it was intended to effect a change in the long-standing practice to which I have referred. Arguably, the rule now imposes a requirement that a lawyer with no prior association with the proceeding provide an opinion. Whilst there may be cases where such an opinion would assist, the substantial additional costs involved in obtaining the opinion of the lawyer with no prior knowledge or familiarity with the proceeding, would likely far outweigh any potential benefits. It is more likely that what the rule intends is that the opinion prepared by the lawyer be provided in furtherance of the lawyer’s duty to assist the Court and not in furtherance of any duty the lawyer may have to a party in the proceeding. In my view, it is in that respect that the lawyer must be “independent”.

10    Counsel accepted the referral and provided the advice which was sought. The advice was carefully considered and detailed. It was plainly provided consistently with counsel’s duty to assist the Court in determining the appropriate response to Ms Modra’s application. I am, therefore, prepared to consider and act on counsel’s advice.

11    Lest I be mistaken as to the meaning to be attributed to “independent” in Rule 9.71, I would, in the present circumstances, dispense with the requirement that the relevant advice be supplied by an “independent” lawyer, in order to permit me to consider and act on counsel’s advice: cf Hickey v Public Advocate (Victoria) [2012] FCA 1203 at [11].

12    In determining whether to sanction a compromise under Rule 9.70(1) of the Rules the Court is concerned only with the benefit of the disabled person: see Gillespie v Alperstein [1964] VR 749. In forming the necessary judgment significant weight will be given to the opinions of the applicant’s legal advisers. In Re Barbour’s Settlement; National Westminster Bank Ltd v Barbour [1974] 1 All ER 1188 at 1191, Megarry J, speaking of an application made on behalf of a minor, said that:

“… there is the important matter of the minors’ benefit. When the court is asked to give its approval on behalf of minors to a compromise of a dispute, the court has long been accustomed to rely heavily on those advising the minors for assistance in deciding whether the compromise is for the benefit of the minors. Counsel, solicitors, and guardians ad litem or next friends have opportunities which the court lacks for prolonged and detailed consideration of the proposals and possible variations of them in relation to the attitudes of the other parties and the apparent strength and weakness of their respective claims. When the matter comes before the court, the terms of settlement are in final form and the time for consideration is of necessity less ample. The court accordingly must rely to a considerable extent on the views of those whose opportunities of weighing the matter have been so much greater. Expressing a view on whether the terms of a proposed compromise are in the interests of a minor is a matter of great responsibility for all concerned.”

13    The same considerations are, in my opinion, relevant when considering the approval of terms of settlement which involve an intellectually disabled adult.

14    Counsel’s advice is supportive of the settlement of the proceeding and the terms on which such settlement is proposed. It is not appropriate that I summarise the advice which goes to the strengths and weaknesses of Mr Modra’s case. It is, however, appropriate to mention that the advice took into account a number of important considerations including:

    The cost (in time, money and mental anguish) of preparing for and conducting what was estimated to be a 12 week trial;

    The financial resources available to Ms Modra and the impact that their diminution was likely to have on her capacity to provide care for Mr Modra;

    The range of compensatory damages which might have been available to Mr Modra had he been successful in prosecuting his case; and

    The desire of Ms Modra and her husband to be freed of the strain which the litigation has placed on them over the past three years and which has limited their capacity to assist Mr Modra.

15    The terms of settlement include a clause which requires the parties to maintain, in confidence, the terms of their agreement. I have read the agreement and am satisfied that the compromise of the proceeding on the terms proposed is in Mr Modra’s best interests. In forming this view I have taken into account counsel’s opinion and Ms Modra’s considered support of the settlement terms.

16    The terms of the settlement will be approved.

Associate:

Dated:    11 October 2013