Lawson v Gillis and Ors

Mr Lawson's employment with St George Bank

1. After a long career in the banking industry, Mr Lawson commenced with SGB as Executive Manager Non-Credit Trading in SGB's Treasury Division on 22 July 2005. He became the Head of Non-Credit Trading in late 2006 remaining there until his retrenchment on 5 February 2010 (Affidavit William Lawson sworn 11 July 2018, CB 1, tab 20, p. 282). His contract of employment entitled him to participate in certain bonus schemes at SGB including the Treasury Incentive Plan ("TIP") and the Medium-term Treasury Incentive Plan ("MTIP"), the latter from December 2007. The MTIP involved share allocations or options exercisable on or after 30 September 2009 and 30 September 2010.
2. As I said in my principal judgment, in May 2008 SGB and Westpac announced their proposed merger. A scheme of arrangement was approved on 17 November 2008 and the merger was completed on 1 March 2010. The new entity operated as a single institution from then (principal judgment [27]), albeit continuing their separate presence in the marketplace.
3. As a key executive in SGB's Treasury Division, Mr Lawson was invited to participate in the RIP by letter dated 18 June 2008. As I have stated in other judgments eligibility for this bonus depended upon SGB achieving a certain rate of earnings per share ("EPS") and the executive concerned remaining in SGB's employment on 13 November 2008. Again, as detailed in other cases (see principal judgment [28]), the letter of offer received by Mr Lawson, as with other key employees, stated an EPS of 8% to 10% when in fact the SGB Board had set the target at 10.1%. The EPS achieved was about 8.3%, within the range stated to employees, but below the target fixed by the Board. SGB declined to pay Mr Lawson (in common with the other SGB claimants) the RIP.
4. It must have been obvious that the merged entity would not require two treasury divisions and on 1 December 2008 Mr Lawson was seconded to Westpac to work in the Strategic Risk Group ("SRG"). On 14 December 2009, Mr Lawson was informed that the SRG would close and his position with SGB would be redundant. He was given a further opportunity to obtain a suitable position at Westpac, referred to as a redeployment period, which did not materialise, and his redundancy took effect on 5 February 2010.
5. Upon retrenchment he was paid a redundancy package after tax of $142,933.56. This included 21.6 weeks' notice and 21 weeks' redundancy at his base salary excluding bonuses. He also received his accrued leave at base salary which, again after tax, amounted to $33,425.28 and a gross bonus payment of $60,000 which was also taxed (Affidavit 5 July 2018, CB 1, tab 20, p. 282 [7]).
6. Mr Lawson believed that his payout did not represent his full entitlements. He believed he was entitled to $45,000 for the RIP, $50,000 in shares as part of the MTIP and $190,000 for accrued bonus entitlements in accordance with the SGB scheme during the period of his secondment to Westpac.

Mr Lawson's claim in the Federal Court

1. By the time Mr Lawson's claim came to mediation on 8 December 2011, it included damages for non-payment of SGB bonuses while seconded at Westpac, payment of redundancy at his total remuneration rate rather than base salary only, a claim for an additional period of reasonable notice at total remuneration, the RIP and damages, as I have said, for deceit, misleading or deceptive conduct and negligent misstatement based on misrepresentations made about the RIP criteria i.e., concerning the EPS.
2. Adopting the schedule of damages attached to Mr Lawson's position paper for 8 December 2011 as a convenient summary of the quantification of his claim (Exhibit 2, p. 417), his total damages claim inclusive of costs and disbursements was presented in the sum of $3,491,015 broken-down as follows: Past economic loss net of employment benefits and redundancy payments received between 1 October 2008 to termination $433,100 Retention incentive $45,000 Interest at 8.5% for 2 years multiplied by 50% $33,060 Future economic loss 16.5 years at $3,557 p.w. (discounted by 3% multiplier, 665.3) less 25% for the vicissitudes $1,774,855 Exemplary damages $1,000,000 Costs and disbursements to 8 December 2011 $205,000
3. After he had considered the position papers for both parties, it is interesting to record that Mr Lawson calculated his own entitlement to unpaid employment benefits on a contract basis, rather than as damages, in an email to Mr Gillis dated 7 December 2011 in the sum of $939,056. This included unpaid bonuses to which Mr Lawson claimed to be entitled, redundancy at total remuneration rates, an additional six months' salary in lieu of reasonable notice and interest (Exhibit 2, p. 450).
4. The issues identified in Westpac's position paper (Exhibit 2, pp. 431 - 5) were that Mr Lawson had been paid his full entitlements in accordance with SGB's redundancy policy (in fact Westpac said he had been paid more than his entitlement); the redeployment period until 5 February 2010 was effectively an additional period of notice; the word "pay" in the redundancy policy means base salary not total remuneration; there was no misrepresentation in relation to the RIP; there was no contractual entitlement to bonuses previously paid; bonuses were discretionary depending upon, inter alia, individual performance; the various iterations of the claim for misleading and deceptive conduct in relation to the RIP were not sustainable and had Mr Lawson left to obtain alternative employment in late 2008 he would have foregone his salary paid up to his redundancy and other benefits paid on, termination of his employment. Westpac argued that the proposition that Mr Lawson would have left his employment with SGB had he known of the difference in EPS target, "is not credible". In short, everything was in issue, as Mr Lawson would have been aware from reading the position papers.
5. As I have said in other judgments, the Federal Court proceedings were heard by Griffiths J who delivered his principal judgment Murphy v Westpac Banking Corporation [2014] FCA 1104 on 14 October 2014. All of Mr Lawson's claims failed other than the claim for the RIP in the sum of $45,000, which had been conceded by Westpac by letter dated 21 March 2012 (Exhibit CB 7, tab 234, p. 2355; principal judgment [104]) were rejected. It is relevant to record here that on 5 December 2011 (Exhibit 2, pp. 92 - 95) Westpac's solicitors had written to the legal practice demanding that the claim in fraud be withdrawn "immediately" and notifying them that if the claims were persisted with and Westpac was successful it would seek an order that the SGB claimants pay the costs, at least referrable to that issue, on an indemnity basis.
6. After further argument, Griffiths J delivered a second judgment (Murphy v Westpac Banking Corporation (No 2) [2015] FCA 266) dealing with costs issues and the form of final orders in each proceeding. In that judgment (at [78]) Griffiths J recorded that Mr Lawson's only substantive success related to Westpac's concession of the RIP and that Mr Lawson failed on all other claims including the serious allegation concerning deceit. It is also relevant to costs to record here that Mr Lawson rejected a formal offer of compromise under Rule 25.01(1) Federal Court Rules 2011 (Cth) made on 9 December 2011 in the sum of $420,000. Griffiths J said (at [78]): "Given the difficulties of apportioning any particular amount to Mr Lawson in respect of the unsuccessful claims by four of the applicants in deceit etc, the appropriate course in the light of this and the other relevant factors set out above is to make no order as to costs for the period up to and including 11 am on 13 December 2011 and to pay Westpac's costs on an indemnity basis for the period thereafter." The other relevant factors referred to by his Honour undoubtedly included the rejection of the offer of compromise.
7. Griffiths J's formal orders included: "(1) Judgment for the applicant in the sum of $45,000 plus interest from 14 November 2008 to 2 April 2012 in the amount of $12,915.37. …. (4) There be no order as to costs for the period up to and including 11 am on 13 December 2011. (5) The applicant is to pay the respondent's costs on an indemnity basis for the period after 11 am on 13 December 2011." On 14 March 2016 Mr Lawson's appeal to the Full Court of the Federal Court of Australia was dismissed with costs (Affidavit David Eric Collinge sworn 3 August 2018, CB 1, tab 21A, p. 916): Westpac Banking Corporation v Wittenberg (2016) 242 FCR 505; [2016] FCAFC 33.

Relevant events before the mediation of December 2011

1. There are, as would be expected, many disputed questions of fact in relation to the events central to the dispute which arises for resolution in this case. These disputed matters mainly involve differences of recollection about what happened at important junctures between Mr Lawson and Mr Gillis. It is the experience of the Courts that human recall is often fragile and likely to be eroded by the long passage of time. There is also the corrupting effect of hindsight which may often inform the reconstruction of earlier events in the memory. Often the reconstructed recall is genuinely believed to be accurate and reliable by the witness without any conscious or deliberate intent to dissemble or mislead. The genuineness of the witness's belief in the accuracy of his or her evidence may lend a semblance of credibility to an account which is misplaced. For reasons such as these, I have attempted to reason to my conclusions about disputed facts, "as far as possible, on the basis of contemporary materials, objectively established facts and the apparent logic of events": Fox v Percy (2003) 214 CLR 118; [2003] HCA 22 at [31]. Given that the case at hand concerns decisions made not to terminate litigation in December 2011, there is an abundance of contemporary materials, and familiarity with the administration of civil justice and the operation of the legal profession provides a firm foundation for an understanding of "the apparent logic of events". That much may turn on what was said by whom, to whom, and when, diminishes the availability of "objectively established facts".
2. As I have stated above, by 21 December 2009 Mr Lawson had been informed that Westpac intended to close the Strategic Risk Group to which he had been seconded and provided him with documentation outlining "an indicative redundancy amount" applicable if he could not be redeployed in the Westpac group. Mr Lawson sought Mr Gillis's assistance to review the documents and "assess whether any offer made … is reasonable" (Exhibit 2, p. 116). Mr Lawson and Mr Gillis met briefly at the latter's office on 22 December when the former dropped off papers for Mr Gillis's consideration.
3. In the early part of 2009, Mr Lawson prepared for Mr Gillis's consideration a number of memoranda (Exhibit 2, pp. 122 - 126) summarising his unfair treatment by Westpac (passing him over for redeployment as a Senior Interest Rate Securities Trader) and detailing the efforts he had made to secure a suitable placement with other leading financial institutions.
4. In his affidavit sworn on 5 July 2018 (CB 1, tab 20, p. 284 [14]), Mr Lawson states that he met with Mr Gillis on 4 March 2010 to discuss his concerns about what Mr Lawson believed were his outstanding entitlements on the termination of his employment. Mr Lawson states that at his request, Mr Gillis drafted a letter for him to Cathy Graycon, a senior human resources manager with Westpac, setting out his claims. However, it seems tolerably clear from the contemporaneous documents that Mr Lawson was the principal author of the letter (Exhibit 2, p. 133). I infer this because it appears as an appendix to an email from Mr Lawson to Mr Gillis commencing, "please see below as an opening letter to Cathy Graycon". Mr Lawson also states, "I would appreciate any comment or suggestions you may have". While I accept that Mr Lawson had discussed his entitlements with Mr Gillis, it is clear from his cross-examination that he had a good understanding of his entitlements and the letter was substantially his own work (274.24T - 276.2T). The point is of some importance because in his affidavit (CB 1, tab 20, p. 285 [18] and following), Mr Lawson appears to say that Mr Gillis was the main author of the letter and the progenitor of the claims propounded of which Mr Lawson expressed dubiousness. However, in cross-examination he agreed that he was "not correct about Mr Gillis having sent [him] the draft". He said, "Yes. It looks like I've sent him the draft" (276.9 - .11T).
5. In his draft, Mr Lawson expressed his deep distress and disappointment "that [SGB] has not made financial recognition of what I believe to be my valid entitlements in its attempt to secure a signed Deed of Release". He then set out six heads of claim, with an explanation of his claim to entitlement, totalling $1,079,835. Mr Lawson denied that these claims were born of his own understanding, uninformed by Mr Gillis's advice. However, I accept that Mr Lawson did not simply go along with Mr Gillis, dubious of the reliability of the advice he had received. He consulted Mr Gillis because he knew the latter was acting for other SGB employees and had acquired expertise in SGB employment entitlements. But Mr Lawson also, as I have said, had a good understanding of his own entitlements. It would be surprising that a man as experienced and financially savvy as Mr Lawson had simply gone along with, and based his involvement in litigation upon, advice from Mr Gillis, the correctness of which he doubted.
6. Ms Graycon replied to Mr Lawson's letter of 5 March 2010 on 16 March denying the additional entitlements claimed.
7. Mr Lawson did not "formally participate in the mediation" conducted on behalf of those of Mr Gillis's SGB clients who had already commenced Federal Court proceedings on 24, 25 and 26 May 2010. Mr Gillis said he kept Mr Lawson up to date on developments (Affidavit 3 August 2018, CB 1, Tab 21, p. 305 [16]). For instance, Mr Gillis caused a copy of the "common issues position paper" prepared in relation to the mediation to be forwarded to Mr Lawson on 17 May 2010 (Exhibit 2, p. 137). It was difficult to decide whether Mr Lawson had any real recollection of these events when he was cross-examined about them (e.g. 280.20T - 281.14T). He not infrequently answered questions along the lines of, "I can't see why I wouldn't, yes" (280.32T), "yes, that makes sense" (280.37T), "Ok" (280.42T) and "that's logical, yes" (281.1T).
8. Notwithstanding what I regarded as this air of uncertainty, in his affidavit (CB 1, tab 20, p. 285 [21]), he purported to recount in great detail a long conversation with Mr Gillis around the time of the mediation without making any mention of the mediation, where he expressed doubt again about the advice Mr Gillis was giving him particularly about the total remuneration interpretation of his entitlements to redundancy. He also recalled Mr Gillis saying, "This is all about settlement" and Mr Lawson asking questions about how settlement could be achieved. Mr Gillis denied much of the detail in Mr Lawson's account. And I was not persuaded that Mr Lawson's account as set out in his affidavit was reliable as to the detail.
9. I infer that as Mr Lawson was a late entrant to the list of SGB claimants, Westpac were not prepared, or perhaps in a position, to consider his claim at the May 2010 mediations. Mr Lawson wrote a detailed email to Mr Gillis on 28 May (Exhibit 2, p. 152) setting out what appeared to be finely tuned arguments why that position was unreasonable. His email indicates that he had a clear understanding of his claim and of the claims of other SGB complainants. It also indicates, as is appropriate, that he had his own views about his own case which he was confident to express. The substance of his email concluded with these paragraphs: "I am mindful that the mediation is an attempt to negotiate an outcome from which the initial starting point in this instance is at polar extremes [Westpac] have declined to offer any further payment (as at March 2010) and my claim at that point was for $1,668,000. In order to reach an agreement, and to assist in the matter for the broader group, I would be willing to accept a lower payment. You have my authority to negotiate a settlement amount down to $630,000 to secure a signed Deed of Release. I see the amended claim as a very reasonable concession to my original claim. I believe my position would be substantially strengthened by showing [Westpac/SGB] an offer ahead of next Tuesday's hearing, as it would be very difficult for them to defend the position where they refused to consider my offer when there is material similarity between my position and the rest of the claimants, and then proceed to settle all others." This is a clear example of a position where, as between Mr Lawson and the legal practice, Mr Lawson was certainly not in a subordinate or dependent position. He was a confident client who knew his own case and was prepared to volunteer instructions about offers and the strategy that should be pursued. The reference to "next Tuesday's hearing" is to a directions hearing.
10. On 8 June 2010, Mr Gillis forwarded to Mr Lawson a copy of the draft Statement of Claim proposed to be filed on his behalf for his comments. He responded promptly on 9 June 2010 making detailed enquiries about whether matters he felt were supportive of his claim could be incorporated. He had the confidence to suggest amendments to the formulation of his case.
11. The offer suggested by Mr Lawson of $630,000 was not put. Instead an offer of compromise under the former Federal Court Rules was served in the sum of $490,000 plus costs as agreed or taxed. In his affidavit, (CB 1, tab 20, p. 288 [26]), Mr Lawson simply states that the offer of compromise was made on his instructions and he understood that Westpac would be responsible for his costs. Mr Gillis provided a detailed letter of advice on 21 June 2010 (Exhibit 2, p. 176) explaining Mr Lawson's claim and indicating a possible total claim of $821,664 plus costs. In his affidavit (CB 1, tab 21, p. 305 [20]), Mr Gillis set out the full discussion with Mr Lawson which included Mr Gillis providing an estimate of Mr Lawson's present costs. Mr Gillis states that initially Mr Lawson said, "I have done my figures and want to put $800,000 plus costs". Frankly, I doubt Mr Gillis's recall on this occasion is accurate, having regard to the instructions volunteered by Mr Lawson on 28 May 2010. Mr Gillis said he acknowledged that something over $800,000 had "a very good basis", but cautioned Mr Lawson about the Bank's infinitely superior position to litigate the matter. He passed on that Mr Cranitch SC had advised other claimants "to look at 60 percent as a compromise". It is important to record that Mr Gillis in substance stated that Mr Lawson accepted this approach and instructed him to put the figure of $490,000 plus costs, which was done.
12. As part of a report to Mr Lawson of 23 July 2020 on progress of the litigation, Mr Gillis informed Mr Lawson that speaking generally of all claims, "[Westpac] has indicated they would be prepared to settle matters on a midway point between their last offer and your last offer". As until then Westpac had not made an offer to Mr Lawson, it's obvious that the comment was a general one, not specific to Mr Lawson's case.
13. In a further update of 13 August 2010, (Exhibit 2, p. 187), Mr Gillis advised Mr Lawson that the Bank continued to express an interest in settlement. Given the nature of the claim made against the legal practice, it is important to emphasise that Mr Gillis also said: "… there is no guarantee that [Westpac] will make any significant advance on the offer they have previously made to you". I interpolate, again, until then no offer had been made, but the advice contradicts Mr Lawson's claims that Mr Gillis always assured him the matter would not go to court, Westpac would settle and pay his costs. Mr Gillis added, "it is difficult to place any further pressure on [Westpac] to further compromise their position" at least until matters were further advanced. The same advice provided a "further estimate of costs" in the range of $25,000 - $30,000. Mr Gillis also advised Mr Lawson that in settled matters, Westpac had allowed 70 - 80 percent payment "of your costs compared to the actual costs you are charged". If his matter proceeded to hearing and Mr Lawson obtained a verdict more favourable than the offer of compromise, "Westpac will be ordered to pay all of your costs". In cross-examination, Mr Lawson acknowledged he had received this advice (286.40 - .50T).
14. As mentioned in my principal judgment, there were informal discussions with Ms Graycon directly on behalf of the Bank in or about November 2010 in an attempt to resolve at least some of the cases of SGB claimants. It is apparent that Mr Gillis took this as an opportunity to attempt to advance settlement in all matters. During these discussions, Mr Lawson put a further offer. Mr Gillis says he pointed out that costs then were around $70,000. Mr Gillis said he referred generally to previous advice given about the potential value of Mr Lawson's claim. After further discussion, Mr Lawson said "I want $1 million clear to me". Mr Gillis said, "We'll put an offer of $1,070,000 inclusive of costs". This represented a significant increase on the offer of compromise. It is also a significant reversal of the downward trend of previous offers. But these things are probably explained by the expected amendment then being developed to include a claim for damages arising out of the RIP misrepresentation, including the allegation of deceit founding a claim for exemplary damages (Exhibit 2, p. 231). This is encapsulated in the following passage of cross-examination: "Q. You've read that. So, what I'm going to put to you is that ‑ and by this stage, that is by the end of 2010, you include in your affidavit, in fact, you hadn't been able to get alternative employment? A. That's right. Q. So, even you would have understood that this claim was the difference between what you would have got if you were looking away at JP Morgan, compared to what you were getting at that time; agreed? A. That's right. Q. So, your claim in this respect was actually increasing because you hadn't been able to get employment? A. Yes. Q. The other addition here was that you were bringing into your claim this claim concerning the misleading conduct about the retention bonus issue? A. That's right. Q. You felt that that would have improved the leverage of this document in terms of procuring a settlement? A. That's right. Q. You thought your own numbers would have been going up because of the fact you hadn't got a job? A. Yep, that makes sense. Q. You understood that a component of the deceit claim was that there may be an entitlement to be awarded ‑ sorry ‑ there was a claim being made for exemplary damages? A. That's right. Q. Mr Gillis had told you he got advice from Mr Goot SC to say that he thought that was a claim that had legs? A. I can't recall specifically the advice from Mr Goot, but Mr Gillis was certainly ‑ certainly told us that's what he was going to do. Q. Would you accept this proposition, that between the start of 2010 and the end of 2010, in your mind, your claim was getting more valuable in the numbers? A. It was certainly ‑ yes ‑ it was a larger ‑ it was larger claim, absolutely. Q. If you go to 263, did you appreciate that exemplary damages was ‑ at least a possible way in which exemplary damages could be calculated was by reference to the banks ‑ by the profits that the person or entity who had acted in a way that justified that order? A. Yeah, that's the way Michael presented it." (295.17T - 296.12T) The foregoing passage is another example where Mr Lawson didn't quite give direct answers to questions he was asked. For instance, his response, "Yep, that makes sense" on one level sounds like an affirmative answer to the question, but in effect is non-committal. Mr Lawson didn't really say what he thought. However, I accept that the increase in Mr Lawson's offer was responsive to that development.
15. Mr Lawson's was one of the five claims where Westpac's solicitors rebuked the legal practice for making an offer stating, "Settlement offers by those applicants were never requested by our client" (Exhibit 2, p. 266). This prompted Mr Gillis to write to Mr Lawson in the following terms (Exhibit 2, p. 265): "Please see attached second page of the letter. The first page only has the settlement offers on it. I still do not know why you are not included as they have never included you in the "hard" cases before. So, with [Westpac's lawyers] an oversight is a distinct possibility. I understand about the settlement offers not being requested in the four other cases, but they did want one in yours". (Original emphasis.) Mr Lawson must be taken to have been aware from this clear statement that Westpac would not necessarily settle all claims or at any price.

The development of the claim in deceit

1. In Murphy v Gillis & Ors [2022] NSWSC 184 ("Murphy v Gillis") (at [31] - [39]), I have set out my findings in relation to the development and formulation of the claim in deceit. Those findings are relevant also to Mr Lawson's claim and I incorporate them in this judgment. Obviously, the opening part of [31] is relevant particularly to Ms Murphy's case. The balance of the passage in substance also applies to Mr Lawson's case. On 7 February 2011, Mr Gillis advised Mr Lawson (Exhibit 2, p. 268) that an application for leave to file the Amended Statement of Claim was being sought in the Federal Court and on 18 February 2011 (Exhibit 2, p. 271), as with the other claimants, Mr Gillis advised Mr Lawson that he had met with Mr Goot SC who had advised in consultation that "on the evidence there is a good prospect of an award for exemplary damages".
2. It is also important to say that on 19 April 2011, in response to a brief update from Mr Gillis, Mr Lawson wrote (Exhibit 2, p. 272): "Thanks for the update. Looks like this one is going down to the wire …" It is clear from this that Mr Lawson fully contemplated the prospect that his case would not settle but would have to run to judgment.
3. From about May 2011 there was discussion about a further mediation for the outstanding claims (Exhibit 2, p. 280). But there was difficulty in agreeing upon the mediator. Mr Lawson wrote: "That's a bit annoying, I was hoping that independent legal opinion would assist us (as our cases are materially stronger than last year)." In a later email of the same date, Mr Lawson referred to a former SGB colleague who was separately represented and who had "walked away from pursuing [Westpac]" because he was concerned about "court risk". I take this to be a reference to the "inescapably chancy" nature of litigation: Maitland Hospital v Fisher [No 2] (1992) 27 NSWLR 721 at 725 (by the Court). Clearly, Mr Lawson grasped the concept.
4. In preparation for the second mediation, Mr Gillis prepared a new schedule of damages for Mr Lawson in mid-2011 (Exhibit 2, pp. 291 - 3). The total of $2,839,172 included exemplary damages in the sum of $500,000 and costs of $135,000. Again, this cuts across Mr Lawson's evidence that he was unsure of his costs (304.45T). While accepting that he was "very focused on the numbers" in the schedule (302.28T), Mr Lawson claimed that he "really didn't pay any attention to that number" for costs (302.14T). Mr Lawson said that given the estimate of between $25,000 and $30,000 provided 12 months earlier, he did not regard it as any more realistic than the total figure of $2.8m on the schedule which he understood "was really [his] best case in court if someone took a very, very favourable approach" (303.10 - .24T). It is frankly difficult to understand the logical connection between figures mentioned in June 2010 and those mentioned in June 2011 given the amount of additional preparation that had been undertaken in the meantime to Mr Lawson's knowledge.
5. During the second half of 2011, Mr Lawson remained actively involved in and engaged with the preparation of his case. He frequently wrote long emails to Mr Gillis discussing aspects of his case, providing additional information he hoped might help in producing evidence to support his claim for damages and offering critiques of Westpac's evidence. It is unnecessary for me to detail the extensive cross-examination about these matters. He was becoming very concerned that Westpac/SGB "might well have ended [his] career as a trader" (Exhibit 2, p. 297; 305.14T). This arose in the context of a job opportunity with "a large global hedge fund" for which he had been recommended by a contact in the industry. Despite his experience and qualifications, he was told he would not be offered the job because he had been "out of the market for 15 months". He was "pretty emotional" about his position (305.14T) and he "felt pretty strongly that Westpac and [SGB] had let [him] down pretty badly". In fact, he still thought that "today" (305.18T). He (and his wife) felt Westpac were deliberately delaying the litigation and he was frustrated (305.30T). He could not understand why if Westpac had settled most cases, they did not settle with him (Exhibit 2, p. 321; 305.50T - 306.1T).
6. By December 2011, Mr Lawson had a good idea of what was happening in his proceedings. He was actively keeping himself abreast of the matter "to try and give [himself] decent prospects" (385.15T).

The exchange of correspondence concerning the claim in deceit

1. As I have recounted in other cases where relevant, on 5 December 2011 Westpac's solicitors wrote to the legal practice at length explaining why they regarded the damages claim for deceit as "baseless" and notifying the SGB claimants through the legal practice that an order that they pay the costs of the proceedings on an indemnity basis would be sought against them in due course on this ground. As I have recounted, Mr Gillis joined issue with the content of the letter of 5 December on 7 December 2011 declining to withdraw the allegation (Exhibit 2, pp. 444 - 448). This correspondence was forwarded to Mr Lawson who appears to have understood it because he did not raise any questions about the content with Mr Gillis (Exhibit 2, p. 456).
2. As I have stated in other matters, it was common ground that, for the purpose of settlement, Westpac would not be prepared to give value for the exemplary damages claim. Mr Lawson appears to have accepted this (Exhibit 2, p. 491). After settlement attempts failed in December 2011, he wrote at length to Mr Gillis on 23 December 2011 setting out his views as to the "need to fully prepare for trial". In setting out the steps he suggested should be taken, at point 11 of his email, he stated: "Exemplary damages need to be put back on the table and we should again introduce the percentage of profit risk to [Westpac's solicitors] in any discussion". Again, it is clear that Mr Lawson fully understood that his case may have to proceed to a hearing. It is also fairly clear that he himself considered his case was a potentially very valuable one.

Mediation of 8 December 2011

1. The mediation in Mr Lawson's case, together with two other SGB claimants who are not plaintiffs in the present proceedings, were fixed for 8 December 2011. Again, the Honourable Tony Fitzgerald AC QC was the mediator. Mr Ian Neil SC and Mr O'Dowd were briefed to represent the SGB claimants, including Mr Lawson.
2. In preparation for the mediation, Mr Gillis forwarded the parties respective position papers and another updated Schedule of Damages to Mr Lawson by email on 28 November 2011 (Exhibit 2, p. 416; see [16] above). He cautioned Mr Lawson: "Do not be concerned with the approach by Westpac and their position paper. This is exactly the position they took before so we do not expect them to make any concessions at this stage as everything is in writing." The updated schedule of damages for Mr Lawson calculated his claim on the damages basis rather than as a claim for accrued entitlements. It totalled $3,491,015. Since June the exemplary damages claim had been increased to $1,000,000 and costs and disbursements now totalled $205,000.
3. In response to Mr Gillis's email, Mr Lawson questioned whether there was any concession in Westpac's position paper in respect of the other claimants. On 29 November 2011 (Exhibit 2, p. 438) he provided a long critique of Westpac's position paper joining issue with it in every significant respect. He provided a second lengthy email on the same day, copying aspects of the contract between Westpac and its CEO as indicative of the type of terms available in the industry, which he felt answered Westpac's criticisms of aspects of his claim, and other matters of banking industry practice relating to contracts of employment. Mr Lawson felt these other matters bolstered his position.
4. As I have already stated (at [17] above) Mr Lawson calculated his own entitlements to unpaid employment benefits in an email of 7 December 2011 in the sum of $939,056. This excluded the more generous aspects of the calculations on a damages basis contained in his schedule of damages, including, obviously, exemplary damages. This document is instructive in terms of the subsequent course of settlement negotiations when viewed from Mr Lawson's standpoint. To my mind, it says a great deal about Mr Lawson's own thinking about the value of his claim.
5. As with other cases, Mr Collinge kept a contemporaneous note of the discussions during the mediation. It is not entirely comprehensive in this case. It is worth considering the contents of that document before going to the affidavit evidence of Mr Lawson and Mr Gillis, which is not in agreement.
6. Looking at Mr Lawson's claim through the prism of a claim for damages, Mr Neil advised him that he would not recover future economic loss for the rest of his working life. Rather, he would only "get a relatively short period". In response to a question from Mr Lawson, Mr Neil expressed the opinion, "2 years". Mr Gillis is recorded as suggesting, I infer for the purpose of calculation of a settlement offer, "3 years", but subject to a reduction of 25 percent for the "vicissitudes". Mr Neil advised that he would be "inclined to pitch [the] next offer close to the [bottom line]". He sought instructions on "an all-up figure" and Mr Lawson said $1.5 million "plus costs". Mr Lawson also specified it should be put as a "damages claim … to be tax effective". After a discussion, Mr Neil advised that if an offer is to be put "on a non-ETP basis" that would need to be specified.
7. In his position paper, the allowance made for Mr Lawson's costs was $205,000. Apparently, Westpac were only prepared to allow party and party costs in the sum of $130,000 in Mr Lawson's case. In his affidavit (CB 1, tab 20, p. 289 [33]) Mr Lawson deals with the mediation briefly stating that the mediation ended after Westpac offered him $420,000 plus costs "which [he] rejected on the advice of [Mr Gillis] and Counsel". Again, Mr Lawson seeks to represent himself as being "a little bit uncomfortable" about the way his claim was being formulated. However, I regard this as an ex post facto state of mind almost wholly informed by hindsight. Mr Lawson said he raised his concerns with Senior Counsel who advised him, "I think if they offer you more than $600,000 then you should take it". He claims that Mr Gillis, while acknowledging that Westpac's offer was "a long way from where we started today" said "but I can get you a lot more than this". He also claims that when he queried the cost component, Mr Gillis said "don't worry about it" because he had inflated costs to give "a higher starting point for negotiations".
8. In his affidavit, (CB 1, tab 21, p. 314 [72] - [75]), Mr Gillis denied that Mr Lawson expressed any uneasiness with the formulation of the claim to counsel, that Mr Gillis stated that he could get "a lot more" than Westpac's offer or that he inflated costs for settlement negotiations. On his account, Mr Gillis said that he and the plaintiff conferred with Mr Neil on 6 December 2011. Mr Neil advised Mr Lawson that his case "[had] good prospects … in relation to your damages claim". He also advised there were good prospects on important aspects of the claim for unpaid employment entitlements. He cautioned, however, that "Westpac is a very well-funded opponent and there is no certainty in litigation" (CB 1, tab 21, p. 309 [45]). Mr Gillis said that Mr Lawson responded that he understood the uncertainty "but the upside is significant". Mr Lawson doubted he could secure employment "in the near future" as there was no job market for proprietary traders like him, "since the GFC".
9. Mr Gillis confirms that at the mediation itself there was a discussion as recorded by Mr Collinge in his notes about future economic loss and the desirability of pitching an offer close to Mr Lawson's bottom line. Although not expressly stated in Mr Gillis's affidavit, it seems to be common ground that the best offer made by Westpac at the mediation was $550,000 inclusive of costs rather than $420,000 plus costs. Mr Gillis states that he told Mr Lawson that Westpac were only allowing $130,000 for costs and that his costs were "more than that". The figure, as I have said, shown on the Schedule of Damages was $205,000. Mr Gillis also states that he advised Mr Lawson that if he obtained a result more favourable than the offer of compromise "put on in June 2010 you will recover all of your costs".
10. Mr Gillis states that he said to Mr Lawson that his costs "to date are around $200,000", but if the case ran, they would be "at least double". He also states that Mr O'Dowd informed Mr Lawson that Westpac intended to serve an offer of compromise equivalent to their best offer at mediation. Mr O'Dowd advised Mr Lawson of the costs' implications of an offer of compromise.
11. From Mr Gillis's affidavit it is clear that his impression was that Mr Lawson was resistant to this cautious advice. He said, "I am already on the edge financially. I have not worked for nearly two years so what is my downside?" Mr O'Dowd said, "You do not want to go bankrupt over this". And Mr Neil said: "But you do not want to go through all of this angst and lose your case and face bankruptcy. There are no guarantees in litigation."
12. In cross-examination Mr Lawson agreed that he did not give instructions to settle his case for either $600,000 inclusive of costs or $600,000 plus costs (357.30 - .35T) as suggested by Senior Counsel. He accepted that Westpac's best offer at mediation was $550,000 inclusive of costs (358.5T). Mr Lawson also stated that he believed his final position at the mediation was $895,000 plus costs (360.30T). He accepted that his offer was more than 50 percent higher than the advice he had received from Senior Counsel (361.25T). He said he was "certainly mindful" of Senior Counsel's advice, but he was relying upon Mr Gillis "to do his role and try settle" the case on more favourable terms than Senior Counsel had advised (361.30 - .35T). He never at any time instructed Mr Gillis that he was prepared to settle the case for either $600,000 inclusive of costs or $600,000 plus costs (361.45T).
13. It's obvious that at the mediation none of the lawyers recommended Mr Lawson accept Westpac's final offer of $550,000 inclusive of costs, with the possible exception of Mr O'Dowd. Mr Neil was certainly advising caution, but I accept Mr Gillis did not regard the parties' failure to agree at the mediation as exhausting the prospects of settlement in Mr Lawson's case. He hoped to achieve a better result for Mr Lawson and each of the other SGB claimants by a process of further negotiation. He regarded Mr Lawson's case as strong. His opinion was that Mr Lawson could well do better than the offer made by Westpac at mediation by going to Court.
14. To the extent to which there is a difference between Mr Lawson's account and Mr Gillis's account, I am not satisfied that Mr Lawson expressed any uneasiness with the formulation of the claim, that Mr Gillis stated he could get "a lot more" or that Mr Gillis said he had inflated the costs for settlement negotiations. Clearly, the last assertion would be completely dishonest when Mr Gillis had relied upon the estimation of $205,000 for the purpose of offers put at the mediation and subsequently in December 2011. I accept Mr Gillis's evidence. I am not satisfied that he misrepresented the costs position to Westpac, or that he would do so. The costs estimate in Mr Lawson's case was comparable to the costs estimate for each of the cases which went to mediation in December 2011. I am satisfied that the figures were not merely "pulled out of the air" but were arrived at in a considered way. They were certainly estimates, but experienced solicitors are accustomed to making such estimates on a daily basis for the purpose of settlement negotiations.
15. While I accept that Mr Gillis was confident about Mr Lawson's prospects, as he was about the prospects of the other SGB claimants, and that he exuded that confidence, I am not persuaded that he would act in a boastful way such as claiming "I can get you a lot more" implies. Especially not in the presence of Senior Counsel who had just expressed a more cautious approach. A solicitor is not bound to agree with counsel when it comes to settlement negotiations and it may be said that counsel, even senior counsel, have no greater expertise in this regard than other experienced lawyers. However, notwithstanding his confidence, even at times "bullishness", Mr Gillis, in my assessment of all of the evidence at the hearing, did not pressure his clients either way, to accept or reject offers. He was prepared to make recommendations on the basis of his honestly held opinions about the case, but he did not push his clients in either direction. Rather he sought to facilitate the client obtaining a settlement that the client could live with. His conduct of the negotiations including the advice he gave to his clients about their progress, and whether to counter offer seems to me to have been reasonably measured. He was prepared to advise but he also allowed his clients the freedom to decide. With financially savvy and otherwise sophisticated clients, this was entirely appropriate. Mr Lawson did not need to be led by the hand and probably, on my assessment, would have resented such an approach from his solicitor. It is clear to me from reading his email correspondence about the case generally and settlement specifically that he dealt with Mr Gillis as an equal and expected the same respect to be extended to him.
16. The idea that Mr Lawson felt uncomfortable or uneasy about his claim being advanced on a damages basis is to my mind scotched by the contemporaneous email correspondence passing between him and Mr Gillis, some of which I have referred to. After receiving Mr Gillis's written advice on 13 December 2011 (as to which see below), he wrote stating: "My understanding is that all negotiations with respect to the settlement of my matter have been conducted on the basis of damages (TPA) and have been reflected accordingly." This was to distinguish his offers from offers that had been made on the ETP basis. On 14 December 2011 (Exhibit 2, p. 472) he again emailed Mr Gillis making a number of points about the relevant evidence and raising a number of questions only some of which are relevant for present purposes: "1. Were you able to reconcile the difference in [Westpac's] offer of $550 plus costs at mediation (and) their OC offer of $420 plus costs on the letter dated 9 December 2011 (possibly cost $130?) incl or excl the difference. 2. How can we be confident that [Westpac's] OC is a TPA based damages offer? Important in the event they raise their offer at some later date once our offer to them expires. …. 4. Is it now your expectation that if there is to be an agreed settlement it is more likely to be achieved in Feb or March 2012. …." In question 1, I infer there is a typographical error, being that the "$550" was inclusive of costs as the context itself makes clear. Clearly Mr Lawson was insistent that his offers should be on the damages basis not the entitlements or ETP basis. And his statement, "if there is to be an agreed settlement" again clearly demonstrates that it was well within his contemplation that his matter may not settle.

Offer to compromise

1. On the day following the mediation, 9 December 2011, Westpac's solicitors made an offer of compromise to Mr Lawson on Westpac's behalf in the sum of $420,000 plus costs as agreed or assessed. The offer did not specify whether or not it was made on an ETP basis. In accordance with the rules of court it was to expire on 23 December 2011.
2. At 10:45 a.m. on 9 December 2011, Mr Gillis states that he telephoned Mr Lawson and discussed the offer with him. As with other cases, Mr Gillis explained his strategy to Mr Lawson. He stated that "this is probably your last chance to settle your claim this year". He suggested putting offers for all SGB claimants "so that Westpac had one figure they could simply pay and end the proceedings". According to Mr Gillis, Mr Lawson agreed with the approach. Mr Gillis says he stated: "….. this should be your bottom dollar that you would be prepared to accept. You have the benefit of Senior and Junior Counsels advice as to the prospects of your case, the risk going forward and the potential quantum of the various claims." (CB 1, p. 311 [50]) Mr Gillis says that Mr Lawson instructed him that he wanted "$900,000 clear to me paid as damages". Mr Gillis suggested an offer of $1.1 million inclusive of costs, the costs would not exceed $205,000 and if accepted, the offer would result in Mr Lawson obtaining $895,000. This was in effect a restatement of Mr Lawson's final offer at mediation. Mr Gillis also explained that the offers would be pitched to expire at 4 p.m. on 16 December 2011 which would enable the other clients, whose offers of compromise expired on 16 December 2011, time to accept their offer of compromise if necessary. The plaintiff agreed with this approach.
3. Mr Lawson's evidence is contrary to Mr Gillis's evidence. In his affidavit of 5 July 2018, while acknowledging receipt of an email from Mr Gillis stating he made a final offer on Mr Lawson's behalf in the sum of $895,000 plus costs, Mr Lawson goes on to state that he had not given Mr Gillis instructions to make a counter offer to the offer of compromise and he was unaware of the terms of the offer made on his behalf until another claimant provided him with a copy of the letter of 9 December containing the offers on behalf of the various SGB claimants (CB 1, pp. 290 - 291 [37] - [41]).
4. I again prefer Mr Gillis's evidence. Mr Gillis's telephone records confirm that he spoke to Mr Lawson for 18 minutes during the morning of 9 December 2011. It was already expected that Westpac would repeat their last offer at mediation converted to a plus costs offer by way of an offer of compromise. Mr Gillis conveyed Mr Lawson's offer of $1.1m on a damages basis in his letter of 9 December 2011 (Exhibit 2, p. 460) together with offers on behalf of each of the other remaining SGB claimants. At 5:40 pm that day he confirmed by email to Mr Lawson that he had done so saying, "the offer of $895,000 plus costs was made on a damages basis". Mr Lawson responded to Mr Gillis's email by stating, "Thanks for the confirmation" and enquiring whether there had been any further dialogue with Westpac's solicitors "or is this it … revisit where we are in a week from now?" The suggestion that Mr Lawson was not aware of what was happening, or had not given instructions to make a counter offer, must be rejected.

Written advice to the offer of compromise

1. On 13 December 2011, Mr Gillis provided the following written advice to Mr Lawson concerning the offer of compromise (Exhibit 2, p. 467): "Dear Will, Your Offer As you know your final offer to settle your matter (with all other applicant's offers) expires at 4 p.m. this Friday, 16 December 2011. Offer of compromise Please find attached an offer of compromise served by Westpac in your matter. The offer of compromise is open for acceptance by you until 23rd December 2011. The offer is made on a "plus costs" as agreed or assessed basis. We estimate that this offer will cover at least 80 - 90 percent of your actual costs. The effect on (sic) the offer of compromise is that if you obtain a verdict less than Westpac have set out in the offer of compromise, you (i) will not recover any more of your costs incurred beyond the date of the offer; and (ii) will have to pay Westpac's costs incurred after the offer of compromise. We do not recommend you accept the offer of compromise." The email went on to report that at the directions hearing that day the hearing date of 2 April 2012 was confirmed and made suggestions in relation to further preparation including retaining an expert recruiter.
2. Mr Lawson responded by email in the following terms later that day (Exhibit 2, p. 470): "Hi Michael, Thanks for passing on the offer and the additional information. As per your instructions, I shall not be accepting their offer. I would also like to highlight the ambiguity respect to tax implicit basis of the offer (sic). My understanding is that all negotiations with respect to the settlement of my matter have been conducted on the basis of damages (TPA) and have been reflected accordingly. In simple terms it reads as thought (sic) they will make a payment of $420,000 + costs in 28 days, is this wording different to those applicants that have been negotiating on an ETP basis?"
3. I have dealt with part of the contents of the email of 14 December 2011 above (at [60]).

The global offer

1. I have set out the circumstances relating to the making of the global offer in my principal judgment (at [78] and following). Many of the circumstances recounted there are, of course, particularly relevant to Ms Lavars's claim. But the general context is also provided by that narrative of the facts as I have found them to be.
2. To recap, the global offer was received by Mr Gillis by email from Westpac's solicitors at 8:53 a.m. on 15 December 2011. The component referrable to Mr Lawson was $700,000 inclusive of costs, 20 percent as ETP and 80 percent as damages. The offer was referred to as the global offer because it was subject to a "one in, all in" condition that "all other offers are accepted by the relevant [claimant]". Upon receipt of the global offer, Mr Gillis telephoned each of his clients in turn to obtain his or her instructions. His telephone records (Exhibit 2, p. 476) indicate that he telephoned Mr Lawson at 9:23 a.m., left a message, and Mr Lawson called him straight back.
3. I interpolate that, objectively, Mr Lawson's component represented an increase in the offer of compromise. Looked at from the perspective that Westpac was still only prepared to pay $130,000 on party and party costs (it was hardly likely to change in so short a time), it was an increase of $150,000 on the offer of compromise. Allowing for the deduction of Mr Lawson's solicitor and client costs, he would have received $495,000 in his hand, still some $500,000 adrift of his final offer of 9 December 2011. The global offer on its terms was open for acceptance by 4 p.m. on 19 December 2011.
4. There is a dispute between Mr Lawson and Mr Gillis about their conversation in relation to the global offer. Mr Lawson (CB 1, p. 292 [53]) said that Mr Gillis referred to the offer as $560,000, on the global basis. Mr Lawson said he responded: "OK, I guess that's good news. How do we get this settled if it's a global offer? I've spoken to everyone but [Mr Poulos] over the last few weeks and I can't imagine people don't want to settle this. What are you going to do?" Mr Lawson said that Mr Gillis stated, "there isn't much I can do, I'm conflicted here". Mr Lawson said he suggested bringing in an ex SGB executive, Peter Fitzgerald, "to help negotiate everyone's interest so this can settle". Mr Gillis said he would think about it.
5. Mr Lawson also stated that as he had been unemployed for nearly two years and he and his wife had run down their savings, implying he was keen to settle.
6. According to Mr Gillis the conversation ran to the following effect (CB 1, tab 21, p. 311 [56]): "Gillis: [Mr Lawson], I've just had an interesting offer come in from Westpac. The offer to you is $700,000 inclusive of costs, taxed 20 percent as an ETP and 80 percent as damages. It is inclusive of costs. Offers have been made by Westpac to everyone, however, in it's on a "one in, all in" basis. Mr Lawson: That's hardly an improvement on their offer of compromise. They don't seem to be appreciating the risks that they are taking when my damages claim gets up, I will not accept the offer."
7. To resolve this conflict it is instructive, I believe, to consider the email exchange between Mr Gillis and Mr Lawson of 22 December 2011. At 5:07 p.m., Mr Gillis wrote to Mr Lawson in the following terms: "It appears no matters have settled. The offer from Westpac made on 15 December 2011 was on the basis all matters settled. Your offer was $700K inclusive of costs with 20 percent as an ETP and the balance as damages. I note you rejected the offer. We will now prepare the matters for hearing commencing on 2 April 2012. Ian Neil SC has been retained to appear for you." (My emphasis.) …
8. Mr Lawson responded at 6:05 p.m. on the same day (Exhibit 2, p. 487 - 488): "Thanks for the update. I understand that the O/C made to me of $420,000 plus costs is the only one that can be considered as a valid O/C because the higher figure was contingent and therefore required global acceptance. In the event we are successful at trial, my hurdle to be clear of any costs is $421,000 - if this is wrong, please advise. I'd be interested in any additional colour regarding the last 24 hours negotiations, and whether there was a formal offer put back to Westpac as discussed. What do I need to do in order to strengthen our position in preparation for trial?"
9. In cross-examination, Mr Lawson accepted that he had spoken to Mr Gillis about the global offer on the morning of 15 December 2011 (376.5T). Mr Lawson agreed that he did say that the global offer was not much of an improvement, even if this is not quite correct. And he understood that the global offer was contingent on others accepting it (376.30T). This is consistent with the content of his email of 22 December 2011, to which I have referred. The following exchange occurred (376.35T - 377.5T): "Q. But you would have had absolutely no interest, would you, in an offer of 560 inclusive of costs? A. Sorry? Q. If Mr Gillis had communicated to you that Westpac had increased its offer to $560,000 meaning $560,000 inclusive of costs, that would have been of no interest to you whatsoever, would it? A. Not no interest. It's just ‑ I think it's fair to say it wasn't much of an increase and that I was asking for Mr Gillis's ‑ Michael's guidance as to what to do and taking his ‑ taking his advice. Q. Well, your position at this stage was your final offer 895 plus costs, wasn't it? A. That's right. Q. And whether this offer was communicated to you as being $560,000 inclusive or $700,000 inclusive, it was significantly below your final position, wasn't it? A. It was, yes." Mr Lawson denied he instructed Mr Gillis to reject the offer, mainly because he would have wanted to discuss the matter with his wife before giving instructions on "really significant matters" (377.15T).
10. On further cross-examination, Mr Lawson accepted that as at 22 December 2011, the day before the offer of compromise expired, he was not interested in accepting $420,000 plus costs in full and final settlement (383.40T). He accepted that then $895,000 was his last instructions to Mr Gillis, but said, "he knew in I was interested to settle it, though" (383.46T). He accepted that being interested in settlement was "one thing", but "the important thing" is the amount of money you are prepared to accept (383.50T).
11. Mr Lawson also agreed that he knew the case was either going to settle or run (385.45T) and he was concerned that his case should be conducted in such a way as to make Westpac's solicitors think they had to pitch their offers higher (385.50T - 386.3T). Mr Lawson also agreed that he was aware there was a risk that he would not succeed in his case, that he would not beat the offers Westpac had made, and that he would have to pay Westpac's costs (386.40T - 387.2T).
12. Although Mr Lawson knew he could be liable for costs, he said he did not know the quantum (387.2T) "but it's reasonable to suggest that it would be expensive" (387.45T).
13. He accepted that he had calculated his redundancy claims as being worth "about $950,000" before the mediation (389.40T) and the difference between the offer of compromise and his potential judgment "would have been very helpful … to have… if it had transpired that way" (391.7T).
14. On 23 December 2011 at 10:53 a.m. Mr Lawson emailed Mr Gillis with 15 "additional preparation thoughts and actions" commencing with the observation, "I presume we now need to fully prepare for trial".
15. In my judgment, Mr Gillis's version of events is to be preferred. Even were I to proceed on the basis that Mr Lawson did not expressly instruct Mr Gillis to reject his component of the global offer because he well understood from what he had been told that it was not available for acceptance by his act alone, Mr Gillis's account is more consistent with the contemporaneous documents, especially the exchange of 22 December 2011, and the apparent logic of events given Mr Lawson's focus upon preparation for hearing. It is implicit in this that he understood that settlement then was unlikely given the yawning gap between his position and Westpac's. He had not given up on settlement, but well understood that for the matter to settle, Westpac would need, from his point of view, to pitch their offers much higher.
16. I'm not persuaded that Mr Lawson, as at 15 December 2011, attempted to capitalise on the global offer by involving a third party in the process. There is no suggestion in the contemporaneous correspondence that any non-lawyer, named or otherwise should become involved as some kind of "honest broker".
17. Having obtained the instructions of all SGB claimants, Mr Gillis rejected the global offer at 9:52 a.m. on 15 December 2011 (principal judgment [84]). He also spoke to Westpac's solicitor about having the "one in, all in" condition removed. He received the response that if Westpac have to run one of the cases, they will run all of the cases (principal judgment [85]).
18. Mr Gillis converted the offers of 9 December 2011 into his own "global figure of $6.48M" (principal judgment [86]) and he received what I have referred to as Westpac's rebuke in their solicitor's second letter of 15 December 2011 (see for example CB 7; tab 231, p. 2350). While Westpac claimed to be prepared to consider "any reasonable offer … made in the spirit of compromise" it was not prepared to bid against itself. Despite further offers put on 21 December 2011 on behalf of some other clients, not including Mr Lawson, Westpac made no further offer at any time before judgment in the Federal Court.
19. Mr Lawson rejected the offer of compromise by his email of 13 December 2011 in response to Mr Gillis's written advice, as I have already recounted.

Rejection of the offer to compromise

1. Mr Gillis believes he spoke to Mr Lawson at 5:29 p.m. on 16 December 2011. Mr Lawson's offer of compromise still had a week to run. Mr Lawson does not recall any further conversation with Mr Gillis. But it is clear that they spoke for in excess of 28 minutes at 11:35 a.m. on 19 December 2011 (Exhibit 2, p. 482) and for around 23 minutes on 21 December 2011 (Exhibit 2, p. 486). The latter is undoubtedly the conversation referred to by Mr Lawson in his email of 22 December 2011. Although Mr Lawson's offer of compromise was open until 23 December 2011, apart from the reference to it in his email of 22 December 2011, it was not revisited. I infer he had already rejected it and on 22 December 2011 was simply confirming his understanding of the effect of it and the bar he had to clear.

The case for Mr Lawson

1. The submissions presented on behalf of Mr Lawson by Mr Gray and Mr Raftery were similar to those presented on behalf of Ms Murphy. This is entirely understandable given the similarities in the presentation of their respective cases in the Federal Court proceedings and the consideration that all of the outstanding SGB claims as at December 2011 were dealt with individually but together.
2. It was argued that Mr Gillis, on behalf of the legal practice, failed to advise him adequately of his prospects of success and the consequences of an adverse outcome. As with Ms Murphy (see Murphy v Gillis [85] and following), again there was a submission that the advice given about the prospects was simplistic in the sense that it was binary: "You will win or you will lose". Rather, what was required was detailed advice addressing the prospects of success on each head of claim and the specific consequences of failing on each of them or some of them together.
3. It was also argued that Mr Lawson was not adequately advised about the costs consequences of rejecting offers and proceeding to hearing if adverse orders were made. Counsel argued that reasonable care required detailed breakdown in terms of the likely sums at stake rather than general statements such as "you will have to pay Westpac's costs after the offer of compromise if the result is less favourable".
4. So far as the global offer is concerned, it was argued that Mr Gillis had a conflict of duty and duty owed to each respective client. Full disclosure and informed consent was required. Alternatively, Mr Lawson should have been referred for independent advice, giving him the option of separate representation in relation to the global offer and subsequent negotiations left open by Westpac's solicitors' second letter of 15 December 2011.
5. Had Mr Gillis acted with reasonable care and in accordance with his fiduciary obligations, properly advised Mr Lawson would have accepted the offer of compromise or taken the opportunity presented by the global offer and subsequent correspondence to negotiate a more favourable result in December 2011 and by that means avoided the economic loss suffered as a result of the relatively adverse consequence in the Federal Court proceedings.

The legal practice's argument

1. Mr Giles SC and Ms Cameron for the legal practice argued that it was wrong in principle to view Mr Lawson's case through the prism of either the specific advice given in relation to the offer of compromise or the manner in which Mr Gillis handled the global offer and subsequent negotiations. Instead, it was necessary to consider the advice given and his actions in the context of the advice previously given to Mr Lawson during the proceedings, not only by Mr Gillis, but also by counsel from time to time.
2. To the extent that the advice given concerned prospects of the claim in deceit, this was covered by advocates immunity because that claim was put to one side for the purpose of settlement negotiations in December 2011 and therefore was covered by the principle of advocates immunity. In any event, the legal practice was not negligent in relation to it as Mr Gillis exercised reasonable care in the formulation, development and maintenance of that claim, having regard to the matters which I have summarised in my judgment in Ms Murphy's case (Murphy v Gillis at [31] - [39] and [118] - [122].
3. In any event, Mr Lawson had his own ideas about settlement and the approach to it, as was his right. Although he had made lesser offers in 2010, he did not take and act on Mr Neil's advice at the mediation on 8 December 2011 as to the proper range for settlement, and in fact never instructed the legal practice at or after the critical period of December 2011 to make an offer on his behalf on a figure less than $895,000. In these circumstances, counsel argued that it could not be said that any negligence of the legal practice or its breach of fiduciary obligation caused the economic loss claimed by Mr Lawson.

Resolution of the claim in negligence concerning the offer of compromise

1. I am not satisfied that the legal practice was negligent in relation to the advice Mr Gillis gave in relation to the offer of compromise made to Mr Lawson on 9 December 2011. As I have said already, I accept that in evaluating this question, it is erroneous simply to focus upon the written advice provided in the email of 13 December 2011. That advice has to be considered in the context of the whole of the advice about settlement provided to Mr Lawson from the inception of his claim, but especially the advice given before, during and after the mediation.
2. I have already acknowledged that in mid-2010, although originally seeking a figure in excess of $1M, he had been prepared on his own initiative to accept $630,000 in full and final settlement at a time when his costs were modest. He also accepted the advice of Mr Cranitch relayed to him by Mr Gillis for the purpose of his own offer of compromise, to accept 60 percent of his apparent entitlements, which was converted into the offer of compromise of $490,000 plus costs. However, during the critical period Mr Lawson, at no stage, instructed the legal practice that he was prepared to accept less than $985,000 plus costs. Even accepting, as I do, that his email correspondence establishes that he was interested in continuing the process of negotiation, there is no suggestion in any of the evidence that he was prepared to consider a figure of $420,000 plus party and party costs. Given the solicitor and client gap between the estimate provided by Mr Gillis of $205,000 and the amount Westpac was prepared to pay of $130,000 for costs, there was a solicitor and client margin of $75,000 to be deducted from the amount of the offer of compromise, had it been accepted. This meant the "clear figure" amounted to $345,000 and it is clear to me that Mr Lawson was not prepared to accept a figure of that order. The same is true of the figure of $550,000 inclusive of costs put by Westpac at the mediation. If $205,000 for costs on a solicitor and client basis is deducted, the same figure of $345,000 is produced.
3. It should also be borne in mind that the offer of $555,000 inclusive of costs was made by Westpac in response to an offer of $1.5M inclusive of costs put by Mr Lawson. Mr Lawson and Westpac were a very long way apart. Even at the end of the mediation when Mr Lawson had responded with the offer of $1.1M, the parties were a very long way apart. Mr Lawson's figure was exactly double Westpac's "last" figure.
4. Although Mr Neil had advised Mr Lawson to consider any offer over $600,000, no such offer was ever put and in any event it is apparent that Mr Lawson did not accept Mr Neil's advice about that. Nor did he accept Mr Neil's advice to put something close to his "bottom line".
5. Accordingly, when Mr Gillis advised that he did not recommend acceptance of the offer of compromise, he was no more than repeating the advice that had been given at the mediation. No one had recommended Westpac's final offer of $550,000 to Mr Lawson and although Mr Lawson's response to Mr Gillis's written advice of 13 December 2011 referred to Mr Gillis's "instructions" when rejecting the offer of compromise, Mr Lawson, in my judgment, was making his own mind up about the decision to reject the offer of compromise. I repeat there was never any serious suggestion that he would accept it. It is hindsight which makes it appear reasonable, even generous.
6. While there was no assessment of the various heads of claim from the email of 13 December 2011 from Mr Gillis to Mr Lawson, twice during 2011 Mr Lawson was provided with a schedule of damages, breaking down the detail of his claim including the costs that had been incurred in acting on his behalf. He also had a good grasp from the advice he had previously been given no doubt of the alternative claims based upon his unpaid employment "entitlements" on termination. This is clearly demonstrated by his email of 7 December 2011. Moreover, at the conference with Senior Counsel of 6 December 2011 and during the mediation on 8 December 2011, I am satisfied that there was discussion about the various heads of damage claimed on his behalf and the likelihood of success in respect of them.
7. I am also of the view that Mr Lawson was aware of the amount of costs incurred on his behalf. As I have said, I do not accept that Mr Gillis said that he had inflated the costs for the purpose of negotiation. Nor do I accept that Mr Lawson did not pay attention to what he had been told about the costs. He struck me as a careful person who attended to the detail of his claim. This is supported not only by his profession in banking, but also by the content of his frequent emails to Mr Gillis about his case during and after 2011. He was given clear advice, to my judgment, about the costs ramifications of Westpac's offer of compromise, which the content of his email of 6:05 p.m. 22 December 2011 makes clear (Exhibit 2, p. 488). He was also advised that Westpac's costs would be "a lot more" than his.
8. I am not satisfied that the settlement advice given by the legal practice, including the advice of counsel briefed by them fell short of the standard of care observed by practitioners of reasonable competence, practising in the employment law field.
9. I have already expressed views referrable to causation. Mr Lawson was an experienced banker, who had his own views about the settlement of his case. I have no doubt that he was interested in settling and that he continued to be interested in settling his case during and after December 2011. He well appreciated that there were risks and uncertainties associated with conducting civil litigation. A colleague who was separately represented had decided not to proceed with his case, to Mr Lawson's knowledge, rather than run those risks. I repeat I accept that Mr Lawson was interested and prepared to settle, but not at any price. Unless Westpac pitched a higher offer than those already made at a level acceptable to him, Mr Lawson was prepared to go to court. This much is demonstrated by the close interest he took in the preparation of his case and the express statements he made about settlement. He obviously understood that timing could be an important consideration influencing the prospects of settlement. Although December 2011 seemed a propitious time for settlement, looked at in the circumstances then pertaining, neither the legal practice nor the SGB claimants concluded that Westpac had come to the end of the road. Only hindsight, to which regard may be had on questions of causation, indicates that was so.
10. While I am not satisfied that $985,000 was Mr Lawson's "bottom line", he was interested in the prospect of further negotiation, had not accepted Mr Neil's advice to seriously consider any figure over $600,000 and remained hopeful that a much more favourable settlement could be achieved before the hearing which was then fixed to commence on 2 April 2012.
11. Had Mr Gillis recommended the offer of compromise to Mr Lawson, the latter would probably have rejected that advice, just as he rejected the advice of Mr Neil about the appropriate range for settlement. I am not satisfied that causation has been established.

Resolution of the claim for breach of fiduciary duty in relation to the global offer

1. Mr Lawson's claim for equitable compensation for the alleged breach of Mr Gillis's fiduciary duty owed to him in relation to the global offer is really resolved on the same basis as this claim made by the other SGB claimants, as I have said. Each of the claimants was really in the same boat in regard to this aspect of the matter. These matters are dealt with in my principal judgment (at [152] - [158]). The essence of the claim in breach was a "conflict of duty and duty" among Mr Gillis's remaining SGB clients. As I said in my principal judgment (at [157]): see Moore v Gillis & Ors [2022] NSWSC 14 ("Moore v Gillis") at [170]; Murphy v Gillis at [113], "to say that some of the eight clients may have wished to accept the offer so far as it concerned them and others to reject it, is not the same thing as saying that their 'interests are in opposition' to one another". As I have otherwise ruled in my principal judgment and the other cases, and I reiterated, the eight remaining clients had separate and unrelated interests in their personal causes of action against Westpac, which were brought individually, although as a matter of judicial convenience ought to be heard together. There was no actual conflict between the duties owed by Mr Gillis to each client. In my principal judgment (at [158]) I said, "The global offer … cut across the careful strategy that Mr Gillis was attempting to pursue at that time". There was no question of him acting both for and against any individual client. He was able to discharge his duty to advance the interest of each in relation to the global offer without impediment of his duty to advance the interests of the others in relation to it. As I said in my principal judgment, he continued to strive to advance the interests of each individual client in negotiating with Westpac to achieve a satisfactory result for that client. I accept that each client, including Mr Lawson, instructed Mr Gillis, as he says, to reject the offer so far as it concerned him or her. From Mr Lawson's point of view, he well understood that because of the "one in, all in" condition (Exhibit 2, p. 488). For the reasons I sought to fully explain in my principal judgment (at [160]) the suggestion that the law of fiduciary duty required Mr Gillis to advise each of the eight clients to instruct separate solicitors to obtain independent advice about the global offer was in truth completely unworkable.
2. In Murphy v Gillis (at [114]), I found: "Nor am I of the view that convening a meeting of the eight remaining clients to work through the issues about the global offer was either necessary or workable. Assuming that the meeting could be organised with the attendance of all eight of them between 9 a.m. 15 December 2011 and 4 p.m. 19 December 2011 with the weekend in between, there was really nothing to work through in circumstances where each had in any event independently rejected his or her component of the offer. Mr Gillis in any event sought to have the "one in, all in" condition removed and attempted to encourage Westpac through its solicitors to consider making offers on the damages rather than on an ETP basis. Neither effort proved successful and notwithstanding his reiteration of 9 December offers as a global sum, other than the stern rebuke, no further offers were ever made by Westpac."
3. I have already rejected Mr Lawson's evidence that he suggested Peter Fitzgerald as an "honest broker" to attempt to reconcile the position of each of the SGB claimants affected by the global offer. I repeat, there is simply no mention of that in any of the frequent correspondence passing between Mr Gillis and Mr Lawson in the second half of December 2011. While such a "broker" acting gratuitously might have assisted in managing any conflict burdening Mr Gillis, which I have rejected, it's difficult to see why that person on the case theory advanced on behalf of Mr Lawson and the other plaintiffs would not himself suffer the same fiduciary limitations or obligations as any other agent. Again, that proposed solution raises more questions than it answers.

Resolution of the claim in negligence in relation to the global offer

1. I have rejected Mr Lawson's evidence that he did not instruct Mr Gillis to maintain his offer of 9 December 2011 in response to the global offer. As I said in my principal judgment (at [164]): "a solicitor may be negligent by failing to inform a client that a relevant conflict exists, to obtain informed consent to continue to act or recommend independent advice because the solicitor, through a want of reasonable care, has failed to recognise the conflict of duty and duty and duty for himself or herself." For the reasons I have explained that did not occur here.
2. As I explained in my principal judgment (at [169]) I do not regard Mr Gillis as having acted unreasonably in dealing with the global offer served with the degree of celerity he brought to bear. This was not the first time he had spoken to any of the SGB claimants about settlement of his or her case. The global offer emerged during an ongoing process of advice, the taking of instruction and negotiation over the period leading up to the mediations and their aftermath. Not everything said about settlement by Mr Gillis or counsel had to be repeated at every juncture. Mr Lawson was a banking executive and in that regard, he was clearly financially savvy. I am satisfied on the facts, in any event, that Mr Lawson would not have accepted his component of the global offer of $700,000 inclusive of costs had it been open to him to do so. While his offer of 9 December 2011 was not his final position, he was interested in the ongoing process of trying to achieve a result he would be satisfied with, which was well north of the offers being made by Westpac. In this regard, his email of 29 February 2012 (Exhibit 2, p. 499) is instructive. He was quizzing Mr Gillis about "our strategy" in relation to settlement including whether new amendments to the Statement of Claim on the basis of the advice that Mr Gleeson SC might convince Westpac's lawyers that the SGB claimants "previous offers would now be very realistic settlement amounts". It is to be borne in mind that Mr Lawson's "previous offer" was $1.1M inclusive of costs.
3. Mr Lawson's component of the global offer is $700,000 inclusive of costs. This would have cleared him $495,000. This was $400,000 less than his last offer, and over $100,000 less than Mr Neil SC's recommendation at the mediation, which he did not accept. I am simply not satisfied that Mr Lawson would have accepted $700,000 inclusive, had it been available for acceptance by his unilateral act. Nor am I satisfied that despite the content of the second letter of 15 December 2011 Westpac were prepared to make any higher offer to Mr Lawson. Correspondence passing between Westpac's solicitors and the legal practice (Exhibit A, pp. 314 - 320) demonstrate that Westpac's solicitors were focused on continuing to take the legal practice to task over the deceit allegations.

Claim in negligence for the institution and maintenance of the claim for deceit

1. Mr Gray and Mr Raftery attempted to argue that specific advice about the prospects of the claim in deceit should have been given in relation to the offer of compromise and the global offer. However, as I sought to explain in my judgment in Murphy v Gillis at [118] - [121] I do not regard this as the correct approach. I have explained my reasoning about this in those paragraphs of that judgment. I incorporate the substance of those reasons here. In addition to those matters which I will summarise, it's clear from the email correspondence which I have already referred to that Mr Lawson was keen to have his case presented at least for the purpose of settlement negotiations as a damages case, rather than a claim for employment entitlements on termination, the ETP basis, which would have been subject to income tax.
2. The three points I made in Ms Murphy's case are equally applicable with some adaptation to Mr Lawson's case. The first is that while in hindsight it was unwise to bring a claim based upon fraud, i.e. the tort of deceit, against Westpac given that Griffiths J decided it was "without foundation", the related statutory claim under s 52 TPA and for negligent misstatement did not have fraud or its like as an element. Absent fraud or some other aspect of contumelious disregard of Mr Lawson's rights, a successful claim viewed prospectively was unlikely to sound in exemplary damages. Secondly, as I have emphasised there was common ground that exemplary damages were "off the table" for the purpose of the December 2011 negotiations. The claim in deceit and its associated claim for exemplary damages played no part in the "giving of advice either to cease or to continue litigating": Kendirjian v Lepore (2017) 259 CLR 275; [2017] HCA 13 at [32]. The third point in the context of Mr Lawson's case is that the loss suffered by him caused by the institution and maintenance of the claim in deceit was limited to his party and party costs prior to the date on which the offer of compromise of 8 December 2011 took effect. He was ordered to pay Westpac's costs thereafter because his judgment was less favourable than the offer of compromise of 8 December 2011 which he rejected.
3. From what I said in Murphy v Gillis about the development of the claim in deceit, it and its related claims fell into that category to which advocates immunity applies. That is to say, the decisions made in respect of those claims were "so intimately connected with the conduct of the case in court that it can fairly be said to be a preliminary decision affecting the way that cause is to be conducted when it comes to a hearing": Giannarelli v Wraith (1988) 165 CLR 543; [1988] HCA 52 at 559 - 560.
4. As I observed in Murphy v Gillis at [121] in his second judgment, at [47] - [54], Griffiths J referred to the evidence led before him in the costs applications to the effect that the claim in deceit and related claims took up between 15 percent and 30 percent of preparation and hearing time from February 2011 when the amendments were made to advance the claims. Clearly those decisions had that interconnection with the conduct of the case which attracts the immunity.
5. If I am wrong in what I have said about the immunity applying the question may arise about whether the legal practice was negligent when propounding the case.
6. As I said in Murphy v Gillis (at [122]) the facts I have accepted in relation to the development and bringing of the claim in deceit demonstrate that far from being bullish or wrongheaded about it, Mr Gillis proceeded with appropriate caution. Although he was of the view that the matter should be advanced, no step was taken without the "approval" of senior counsel. Mr Cranitch SC drafted the original pleading "himself"; Mr Goot SC advised in February 2011 there were grounds for bringing the claim; Mr J Gleeson SC advised in conference in August 2011 and again in 2012 supporting the claim; and Mr Sullivan QC accepted the brief and presented the evidence and argument at the hearing before Griffiths J with robustness. That the claim failed establishes that the decisions made were wrong, not that they were negligent: Studer v Boettcher [2000] NSWCA 263 at [54], Handley JA; principal judgment [17] - [19].

Causation

1. I have, in analysing the various heads of claim made findings of fact applicable to questions of causation applicable to Mr Lawson's case. So far as claims in negligence are concerned, the questions of legal causation are to be determined in accordance with ss 5D and 5E Civil Liability Act 2002 (NSW). For the purpose of s 5D(1)(b), I am satisfied that no question arises about the scope of the legal practice's legal liability. A professional's duty of care to his or her client is a well established category of duty recognised by the law of negligence and no question arises about whether the legal practice's liability should extend to the harm suffered by Mr Lawson, had he been successful on the liability issues propounded by him.
2. I have already made it clear that had I been of the view that the legal practice negligently advised Mr Lawson in relation to the offer of compromise, Mr Lawson would not have accepted it in any event. I have findings to similar effect in relation to the global offer. To the extent to which liability in respect of the global offer depends upon equitable principles, obviously the Civil Liability Act does not apply. But under the general law, similar considerations are in play, bearing in mind that all questions of causation are asked and answered for the purpose of attributing legal responsibility within the context of the particular legal principles governing that liability. I am satisfied that even though the global offer represented to my mind a significant increase in the offer of compromise it did not rise to a level that Mr Lawson would have accepted.
3. I am not satisfied that the second letter of Westpac's solicitors of 15 December 2011 was a renewed invitation to treat from Westpac, whatever Mr Gillis thought about it. I have said more than once that in context and in substance it was a rebuke for inviting Westpac to bid against itself by restating the offers of 9 December 2011 in response to the global offer when Westpac took the view that the global offer was a counter-offer that rejected those offers. The subsequent course of events establishes that Westpac made no further offer in the case (leaving aside the case of Mr Bechelli), it is for Mr Lawson to prove that Westpac would have made another higher offer, the terms on which it would have been offered and that he would have accepted an offer on those terms. Mr Lawson has not discharged this onus of proof: Donnellan v Woodland [2012] NSWCA 433 at [158], Beazley JA.
4. So far as the claim in deceit is concerned, the reasoning I expressed in Murphy v Gillis [132] - [133] is equally applicable to Mr Lawson's case and I incorporate it here: "Concerning Ms Murphy's third category of claim, I have already made clear that Westpac were not prepared to treat with the SGB claimants on the basis that any damages were to be paid, whether exemplary or otherwise, on the basis of the claim in deceit and related claims. It follows from this that the only option available to Ms Murphy was to abandon those claims as others did. This consideration bolsters the decision I have made that instituting and maintaining these claims is covered by legal practitioners' immunity. Given the relative care exercised by Mr Gillis, as I have found, in relation to this particular matter, it seems unlikely that he would have advised any one of his clients to discontinue the claim. His view supported by senior counsel was that the claim had reasonable prospects of success and might return significant dividends to his clients. That he was prepared to engage with Westpac's solicitors in the December correspondence about this head of claim also demonstrates that Mr Gillis is not of the view that his clients should drop this claim under Westpac's threat of an adverse costs order if they did not. He provided the correspondence to his clients, including his response, which set out his genuine views about the prospect of success. Ms Murphy read the correspondence that had been sent to her and understood it. She was evidently not put off by Westpac's truculence. I repeat that she had done her own homework in relation to this issue and certainly felt that SGB or Westpac had acted in contumelious disregard of her rights. That she continued with the claim when others dropped out demonstrates that she was prepared to take the risk involved. I am not suggesting, as it was put by counsel for Ms Murphy in their submissions, that on the legal practice's case she was a "reckless risk-taker". However, she understood that Westpac took a strong view about the appropriateness of the claim, were determined to staunchly defend it, and were not prepared to entertain settlement on the basis of it. Given that she took comfort from the determination of others to go on with the case notwithstanding the difficulties that may have been perceived, I am not satisfied that she would have abandoned the claim absent strong advice to that effect from Mr Gillis. For the reasons I have given, strong advice to that effect was not called for by a reasonable solicitor competent in the field which Mr Gillis professed." Substituting "Mr Lawson" for "Ms Murphy", the same reasoning applies. As I have said, in other ways, Mr Lawson was "invested" in the damages claim.

Conclusions on liability

1. For the reasons given, I am not satisfied that Mr Lawson has made good any of his claims and judgment must be entered into for the legal practice.
2. The legal practice relies upon the partial defence of contributory negligence. It submits that any damages should be discounted to the tune of 20 percent. The particulars of contributory negligence may be summarised by stating that Mr Lawson never instructed Mr Gillis to accept or to make any offer in the amounts offered to him by Westpac in either the offer of compromise or the global offer; Mr Lawson did not instruct Mr Gillis that because of "court risks and uncertainties" he did not wish to pursue the litigation; and although Mr Lawson continued to hope that more favourable offers would be made after December 2011, he did not expressly instruct Mr Gillis to put any figure below his 9 December 2011 offer.
3. It is fair to say in Mr Lawson's case that although, (a) Mr Gillis did not recommend the offer of compromise; and (b) the global offer was not available for acceptance by him and alone, he was advised by senior counsel to seriously consider any figure of $600,000 and he did not accept that advice and provide instructions in those terms to the legal practice. I consider it appropriate to regard Mr Giles's advice as a recommendation of seriously considering any offer over $600,000 plus costs which would have been in the range of $730,000 to $805,000 inclusive. Westpac at no time made offers in that range to Mr Lawson, even if it may be accepted that his component of the global offer was close to the bottom end of that range. But the global offer was a last ditch attempt, as it happened, by Westpac to settle all cases. It was not available for acceptance by Mr Lawson and subsequent events demonstrated that Westpac were not prepared to make any further higher offers to Mr Lawson. I accept that failing to accept senior counsel's advice is a failure on Mr Lawson's part to exercise reasonable care of his own financial interests. On the other hand, for the reasons I have given, it is not a failure that caused any loss. As it transpired, Westpac were not prepared to make an offer in the range recommended by Mr Neil.
4. I do not regard it as contributory negligence for Mr Lawson to have omitted to instruct the legal practice to either accept the offer of compromise or his component of the global offer. The legal practice did not recommend he accept the offer of compromise and it is hardly unreasonable for Mr Lawson to have accepted Mr Gillis's advice. The global offer was not open for acceptance by him. This proposition was central to the legal practice's defence of that aspect of Mr Lawson's claim. There is no contributory negligence involved here. Moreover, it's simply unreasonable to suggest in circumstances where Mr Gillis believed that Mr Lawson had a strong case, it would probably settle and if it did, Westpac would pay his costs, to suggest that he was guilty of contributory negligence by failing to walk away from the litigation.

Contingent findings on quantum

1. As I have said in my principal judgment, the parties agreed that after publication of my reasons, they should have the opportunity of either bringing in short minutes or making further argument on the quantum issues. Given my liability decision, those steps are unnecessary. However, lest I am wrong in this assessment, I will allow liberty to apply.
2. I have set out my views as to the preferred approach to the assessment of economic loss in these matters in my principal judgment (at [203] - [217]). I will follow that approach here. I wish to acknowledge that counsel on both sides of the record have provided very detailed written submissions in relation to quantum. Mr Gray and Mr Raftery have also provided tables demonstrating the differences in approach of each side. Counsel have also worked to agree upon the amount of the various components which inform the final figure. They are not agreed as to how the figures should be utilised in assessing damages. But I am grateful for their efforts.
3. As with the other cases, I only to propose to calculate the quantum I would have awarded had Mr Lawson been successful on his claim relating to non-acceptance of the offer to compromise. This is for the reasons I have rehearsed in my principal judgment (at [214] and [218]). This is essentially because I do not regard the global offer as an offer made to Mr Lawson which was capable of acceptance by him alone. At best it may have provided an opportunity for further negotiations, about which I am doubtful for reasons I have already addressed, in particular, having regard to Westpac's failure to engage in any further negotiations whatsoever with any remaining SGB claimant after the global offer was made, with a possible sole exception in the case of Mr Bechelli.
4. Lest I am wrong in this approach, as in other cases, I would have considered that the assessment of any loss of a valuable opportunity to achieve a settlement when the global offer was made, presumably in excess of the offer to compromise, would involve a Sellars v Adelaide Petroleum NL (1994) 179 CLR 332; [1994] HCA 4 ("Sellars") discount of 40 percent, to have regard to the inherently imponderable factors that necessarily inform the assessment of the purely hypothetical. The offer to compromise falls into a different category: it was made; it was available for acceptance by Mr Lawson alone; and had he accepted it, it would have brought the Federal Court proceedings to an end on favourable terms and certainly terms more favourable than the actual result. The offer of compromise was certain. The assessment damages founded on it requires no deduction or discount to have regard to uncertainties.
5. According to the schedule prepared by Mr Gray and Mr Raftery, the total loss suffered by Mr Lawson by his failure to accept the offer of compromise is $988,615.63. This figure does not include any allowance for the legal practice's assessed costs and disbursements incurred after 23 December 2011 when the offer of compromise took effect. Both sides accept that for technical reasons that figure may not be included in the damages.
6. Essentially, as discussed in Ms Murphy's case, because Mr Lawson and the legal practice disagree about what should be allowed for Westpac's costs under the adverse costs order, Mr Giles and Ms Cameron suggest a subtotal of $665,385.63. From this figure they argue a Sellars discount of 50 percent should be made as well as a reduction of 20 percent for contributory negligence. Allowing for these things, the total damages to be awarded would be $266,154.25. On the approach of each party, interest would need to be added.
7. As I have sought to indicate, like the case of Murphy v Gillis, the difference between the parties largely relates to their respective positions in relation to the costs due to Westpac. Each claimant, other than Mr Wittenberg, has entered into a settlement with Westpac in relation to the adverse costs orders. The legal practice argue that each settlement was unreasonably unfavourable to each claimant, including, here, Mr Lawson. Separate figures have been provided in relation to the calculation provided by the legal practice. Given that these are contingent findings, I do not propose to descend into the detail of those figures.
8. As in the other cases, for the reasons I gave in my principal judgment, I repeat that I am not of the view that the claim based upon the failure to accept the offer to compromise should be subject to a Sellars discount. Mr Lawson's offer to compromise was on the table and capable of acceptance by 5 p.m. on 23 December 2011. For him to prove some loss resulting from the defendant's negligence, he need only establish on the balance of probabilities that Westpac would have made the offer - it already had - and he would have accepted it. On this basis there is no occasion for making a Sellars discount. I reiterate, the offer was a sum certain, available for immediate acceptance by Mr Lawson's unilateral act.
9. As I have said in other cases, I confess to having a little difficulty following the methodology propounded by counsel on both sides of the record in relation to the calculation of quantum. I prefer the simpler approach propounded in my principal judgment, always bearing in mind there may be no one correct approach to the assessment of damages. The starting point must be the offer of compromise in the sum of $420,000. From this it is necessary to deduct judgment and interest on the RIP issue, the only issue Mr Lawson succeeded on in the Federal Court proceedings. That sum is $57,915.37. It is also necessary to deduct the solicitor and client margin actually payable by Mr Lawson to the legal practice in December 2011, had he accepted the offer of compromise. That amount is $75,000, being the difference between the costs estimate provided by Mr Gillis of $205,000 on a solicitor and client basis and the amount of $130,000 Westpac were apparently prepared to agree to as party and party costs in Mr Lawson's case. Obviously, Mr Lawson would have had the option of requiring an assessment (or taxation) of his costs on both bases. Despite his evidence about not appreciating the quantum of costs which I have not accepted, I am not persuaded that Mr Lawson would have taken this step. Costs is always a critical issue for a client considering acceptance of an offer to compromise, or indeed any offer. Proceeding, as I must for these contingent findings, on the assumption that "properly advised" Mr Lawson would have instructed Mr Gillis to accept the offer to compromise, the greater likelihood is he would have accepted the accuracy of the estimate of his solicitor and client costs and been prepared to accept what Westpac was prepared to pay in respect of his party and party costs. After all, he was "keen to settle". One advantage of settlement is obtaining an earlier payment of the proceeds of the litigation. Requiring assessment (or taxation) of costs is a lengthy process involving additional expense. Clearly, the need to engage in that further procedure would be an important factor weighing against acceptance of an offer.
10. There is an additional complication in relation to party and party costs in Mr Lawson's case. As I have pointed out above (at [20]), Griffiths J exercised his discretion to deprive Mr Lawson from the order to which he would otherwise have been entitled under the rules that Westpac pay his party and party costs of the proceedings up until the offer of compromise took effect. This is the amount of $130,000 I have repeatedly referred to. Arguably, given my findings in relation to the claim in deceit, his loss in respect of his party and party costs prior to the effect of the offer of compromise is caused by the decisions made in relation to the claim in deceit, which I have held are covered by advocates immunity and therefore this loss is irrecoverable. Neither side seem to have taken that point in relation to those costs and I will put the issue to one side.
11. I reiterate that because the judgment in Mr Lawson's favour was less favourable than the offer to compromise, Griffiths J ordered him to pay Westpac's costs on the indemnity basis after 11 a.m. on 13 December 2011 when the offer to compromise took effect. Both sides agree that the amount properly payable to Westpac under this order should be included in his damages. The amount of the settlement between Westpac and Mr Lawson is $517,230 including the costs of the appeal. As I said in my principal judgment, I would not have been inclined to allow the costs of the appeal, and no point is taken by the legal practice about that matter. The legal practice argues that the reasonable amount of settlement of Westpac's costs for reasons it set out in the schedule attached to its submissions on quantum is $250,000. I am prepared to find that the amount agreed to by Mr Lawson represents a reasonable settlement of his liability to pay Westpac's costs. His current lawyers negotiated the agreement and obtained a discount. As I remarked in my judgment in Moore v Gillis at [193], the matter is complicated because of the two-level settlement negotiated. Given that the settlement was negotiated at arms-length by experienced lawyers about whom no criticism is levelled, I regard this settlement as between the legal practice and Mr Lawson for the purpose of assessing his contingent damages as reasonable. It is also accepted that Mr Lawson paid the sum of $128,301 to the legal practice after 13 December 2011, which amount should be included in his damages: Berry v British Transport Commission [1962] 1 QB 306.
12. As in other cases, there remains a question about the legal practice's entitlement to claim additional costs from Mr Lawson for work done before and after 13 December 2011, which has not been resolved by finalisation of the assessment process. The legal practice contents itself with arguing that this issue cannot be dealt with as damages. As in Moore v Gillis, I would have been prepared to make a declaratory order in terms I would have required the parties to bring in to finalise the proceedings and quell all the issues in dispute. But it needs to be borne in mind that had Mr Lawson accepted the offer to compromise while it was still open, Westpac would have paid his costs on a party and party basis, and there can be no "double deduction".
13. I would have calculated the damages as follows: Offer to compromise $420,000.00 Less judgment recovered $362,084.63 Less solicitor and client margin $75,000.00

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$287,084.63 Plus costs paid to the legal practice after 13 December 2011 $128,301.00

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$415,385.63 Plus Westpac's costs $517,230.00

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$932,615.63

Orders

1. My orders are: 1. Judgment for each defendant as against the plaintiff. 2. The plaintiff to pay the defendants costs. 3. Liberty to apply on short notice.

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DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 25 March 2022