The Lifespan of Settlement Offers: A Closer Look

In the context of legal proceedings, the offer of compromise is an indispensable tool. It not only hastens the resolution of disputes but also mitigates the potential financial and emotional toll of litigation on all parties involved.

One critical aspect of these offers, however, often stokes debate: the time in which an offer should remain open.

This question has been addressed through several judicial decisions, one of them being Tonkin -v- Heilongjiang Feng Ao Agricultural & Animal Husbandry Group Co Pty Ltd [2015] WASC 378 (S).

This case concerned a Calderbank offer, a specific type of settlement offer, based on the English case Calderbank v Calderbank [1975] 3 All ER 333.

In the Tonkin case, the court underscored the pivotal role of the Calderbank offer in facilitating dispute resolution. The defendant's offer, a Calderbank offer, was open for seven days until a specified date. However, the court had to determine whether the plaintiffs' rejection of this offer was unreasonable. This evaluation involved a holistic view of the circumstances surrounding the offer.

The court's approach towards Calderbank offers has been shaped by various decisions, both within Western Australia and across the Commonwealth. In the case of Ford Motor Company of Australia Ltd v Lo Presti [2009] WASCA 115, the court held that the test for awarding indemnity costs against a party who rejected a Calderbank offer was whether the rejection was unreasonable under the circumstances. The burden of proof falls on the offeree to establish unreasonableness.

A similar sentiment was echoed in the New South Wales Court of Appeal in Miwa Pty Ltd v Siantan Properties Pte Ltd [No 2] [2011] NSWCA 334. The court posited that a reasonable offer could alter the court's perspective on the costs award, particularly when the party rejecting the offer fails to obtain a better result in the judgment.

When assessing the reasonableness of rejection, several factors come into play. These were elucidated in Lo Presti and further elaborated by Beech J in McKay v Commissioner of Main Roads [No 7] [2011] WASC 223 (S). These include:

• the stage of proceedings at which the offer was received;

• the time allowed to the offeree to consider the offer;

• the extent of the compromise offered;

• the offeree's prospects of success, assessed at the date of the offer;

• the clarity with which the terms of the offer were made; and

• whether the offer foreshadowed an application for indemnity costs in the event of the offeree's rejection.

In Tonkin, the court examined these factors to determine the reasonableness of the rejection.

The offer was made within six months of the commencement of proceedings, which was considered marginally in favour of the defendant. However, the court viewed the seven-day timeframe as potentially too short for careful consideration and perhaps expert advice, suggesting 28 days might have been more appropriate.

Key Take-Aways

• The time in which offers need to remain open is a nuanced issue and depends on various considerations.

• It requires a careful balance between hastening dispute resolution and allowing enough time for the parties to make informed decisions.

How to deal with opposing lawyers who use “Conferral as a Weapon”

In legal disputes within Western Australia, you often need to confer with the opposing party before initiating a case or making an application in court.

Conferral is intended to encourage cooperation and communication between parties, helping to narrow the disputed issues and facilitate settlement.

However, conferral is not always a smooth and productive process. Occasionally, one party (often the defendant) might use conferral as a weapon to delay proceedings, increase your legal costs, or frustrate your legitimate claims. This behaviour contradicts the underlying objectives of conferral.

As a lawyer specialising in defamation, guardianship, and legal costs disputes, I have seen many instances of conferral being used as a weapon by parties and their legal advisors.

Some common tactics include:

• Refusing to confer or respond to reasonable requests for conferral;

• Making unreasonable or excessive demands for information or documents;

• Raising new or irrelevant issues during conferral;

• Making false or misleading statements or allegations;

• Engaging in disrespectful or aggressive behaviour towards the other party or their legal representative;

• Withdrawing from conferral without notice or explanation;

• Failing to comply with agreed outcomes or timetables;

• Deliberately delaying the process to increase the opposing party's legal costs or cause frustration.

To address the issue of conferral misuse and counteract the use of conferral as a weapon, consider these tips:

1. Be prepared: Before conferring with the other side, make sure you have a clear understanding of your case, your legal rights and obligations, and your desired outcomes. Gather all the relevant information and documents that support your position and be ready to share them with the other side if appropriate. Also, have a realistic assessment of the strengths and weaknesses of your case and the other side's case, and be prepared to negotiate in good faith.

2. Be proactive: Don't wait for the other side to initiate conferral. Contact them as soon as possible after becoming aware of the dispute and propose a suitable time and method for conferral. This shows that you are serious about resolving the matter and puts pressure on them to respond. If they refuse to confer or ignore your requests, document their lack of cooperation and inform them of the potential consequences, such as sanctions from the court or adverse costs orders.

3. Be respectful: Even if the other side is using conferral as a weapon, maintain a respectful and professional tone during conferral. Avoid personal attacks, insults, or accusations that may escalate the conflict or damage your reputation. Focus on the facts and the law, not on emotions or personalities. Remember that conferral is not a trial or a debate, but a constructive dialogue aimed at finding a mutually acceptable solution.

4. Be assertive: While being respectful, don't let the other side push you into agreeing to something that is unfair or unreasonable. Stand up for your rights and interests, and don't be afraid to challenge any false or misleading statements or allegations made by the other side. If they make unreasonable or excessive demands for information or documents, ask them to justify their relevance and necessity. If they raise new or irrelevant issues during conferral, remind them of the scope and purpose of conferral and ask them to focus on the main issues in dispute.

5. Be flexible: Conferral is not a one-way street. You have to be willing to listen to the other side's perspective and consider their proposals. You may have to compromise on some points or make some concessions to reach an agreement. However, this does not mean that you have to give up your core principles or accept an outcome that is detrimental to your interests. You have to balance flexibility with firmness, and know when to accept an offer and when to walk away. Being open to negotiation does not mean allowing the other side to exploit the process or use conferral as a weapon.

6. Be aware of delay tactics: Recognise when the other side is using delay as a weapon and address it head-on. Keep track of the timeline and document any deliberate delays or stalling tactics used by the opposing party. If the other side consistently prolongs the conferral process without good reason, consider discussing the issue with them, or if necessary, inform the court or seek appropriate remedies.

7. Set clear boundaries and deadlines: Establish a clear agenda and reasonable timeframes for the conferral process to prevent unnecessary delays or diversions. Make sure both parties are aware of these boundaries and deadlines, and hold the other side accountable if they fail to adhere to them.

8. Stay focused on the primary issues: Keep the conferral process centred on the main issues in dispute and avoid getting sidetracked by irrelevant matters. If the other side attempts to introduce unrelated or trivial topics, gently steer the conversation back to the primary concerns.

9. Know your options: If the conferral process is being misused and you have exhausted all efforts to address the issue, be prepared to move on to the next step in the litigation process. Do not allow conferral to drag on indefinitely or become an obstacle to resolving the dispute. Understand the available alternatives, such as mediation, arbitration, or ultimately, litigation, and be ready to pursue these options if necessary.

By being prepared, proactive, respectful, assertive, and flexible, you can more effectively navigate the challenges posed by the misuse of conferral and minimise the impact of conferral being used as a weapon in lawyer-on-lawyer disputes.

Stay focused on your goals, and be willing to adapt your approach when necessary to achieve a fair and satisfactory resolution.

Relying on "Information and Belief" in Affidavits

Affidavits play a crucial role in presenting evidence to the court.

These sworn statements are used in various legal proceedings to establish facts and provide testimony.

One of the key aspects of affidavits is the reliance on information and belief.

Reliance on Information and Belief in Affidavits

In some instances, a deponent may not have direct knowledge of certain facts but can still provide evidence in an affidavit based on information received from other sources or their belief in the truth of such information. This is known as relying on information and belief in affidavits.

This concept is particularly important when dealing with interlocutory proceedings, where there may be limited time and access to direct evidence.

A Western Australian Case: An Illustration

The Western Australian decision of Blythe v the State of Western Australia [2008] WASCA 10 offers insights into the practical application of reliance on information and belief in affidavits.

In this case, the affidavit contained hearsay evidence from a former student, but the deponent, Ms. Jorden, failed to identify the student or state that she believed the information provided by the student was true.

The appeal court found that this lack of compliance with the requirements of reliance on information and belief rendered the hearsay evidence inadmissible.

Rule Governing Reliance on Information and Belief in Affidavits

In Western Australia, the reliance on information and belief in affidavits is governed by Order 37 Rule 6 of the Rules of the Supreme Court 1971 (WA).

According to this rule, an affidavit used for interlocutory proceedings may contain statements of information or belief, provided the source of the information is disclosed and the deponent believes the information to be true.

Compliance with the requirements of Order 37 Rule 6 is crucial for several reasons:

1. Ensuring Admissibility: Properly drafted affidavits that adhere to the requirements of reliance on information and belief increase the likelihood of the evidence being admissible in court.

2. Countering or Challenging Evidence: Disclosing the source of the information allows the opposing party to counter or challenge the evidence presented in the affidavit.

3. Potential Prosecution for Perjury: Accurate and complete affidavits are necessary to hold deponents accountable for the veracity of their statements, enabling prosecution for perjury if required.

Lewkowski v Bergalin Pty Ltd

In the case of Lewkowski v Bergalin Pty Ltd (Unreported, WASCA, Library No 7675, 26 May 1989), the court emphasized the importance of following the proper form for statements of information or belief in affidavits. This form is essential not because of a desire for ritualized behavior but because it clearly indicates the source of the information, states the information, and expresses the deponent's belief that what was said is true. If this form is not followed, there is a risk that drafters of affidavits may produce inadmissible evidence under the relevant rules, as seen in In re J L Young Manufacturing Co Ltd [1900] 2 Ch 753.

The court stated, “Preferably statements of information or belief in affidavits should follow the form 'I have been informed by X and verily believe'.”

Following the proper form and complying with procedural rules ensures that evidence presented is admissible, allowing parties to effectively challenge or counter it and preventing potential miscarriages of justice.

In Blythe v the State of Western Australia [2008] WASCA 10, the primary court did not rule on the appellant's objection to paragraphs 18 and 19 of Ms. Jorden's affidavit. These paragraphs contained hearsay evidence that should have been deemed inadmissible. The appellant's objection should have been upheld, as the affidavit did not comply with the required form for statements of information or belief under the relevant rules (O 37 r 6). The affidavit failed to disclose the identity of the former student and did not state that Ms. Jorden believed what the student said was true.

As Wheeler JA noted in Westpoint Management Pty Ltd v Goakes [2002] WASCA 317, [14], the requirements of O 37 r 6 are essential because they reveal the original source of the hearsay information, provide an opportunity for an opponent to counter or challenge it, and enable prosecution for perjury if necessary.