Magann v Trustees of the Roman Catholic Church of the Diocese of Parramatta

26 Spina v Permanent Custodians Ltd (2009) 14 BPR 26;923; [2009] NSWCA 206 The Owners Corporation of Strata Plan 61390 v Multiplex Corporate Agency Proprietary Limited and Ors (No 2) NSWSC 322 Thorne v Kennedy (2017) 263 CLR 85; [2017] HCA 49 Tonto Home Loans Australia Pty Ltd v Tavares; FirstMac Ltd v Di Benedetto; FirstMac Ltd v O'Donnell [2011] NSWCA 389 West v AGC (Advances) Ltd (1986) 5 NSWLR 610 Wilton v Farnsworth (1948) 76 CLR 646; [1948] HCA 20 Texts Cited: Royal Commission into Institutional Responses to Child Sexual Abuse, Redress and Civil Litigation Report (2015) Category: Principal judgment Parties: The Trustees of the Roman Catholic Church of the Dioceses of Parramatta (Applicant/Defendant) Darren Peter Magann (Respondent/Plaintiff) Representation: Counsel: L Gyles SC with A Campbell (Applicant/Defendant) T Boyd (Respondent/Plaintiff)

Solicitors: Makinson d'Apice (Applicant/Defendant) Herbert Weller (Respondent/Plaintiff) File Number(s): 2017/254444 Publication restriction: Nil

Overview

1. This application concerns the validity of a Deed of Release. The plaintiff, Darren Magann, sues the Trustees of the Roman Catholic Church of the Dioceses of Parramatta ("the Church") for damages arising out of historical child sexual assault allegations. The Church defends the claim by reliance on a Deed of Release entered into by Mr Magann which the Church claims extinguishes its liability.
2. On 18 October 2018, Harrison AsJ ordered that pursuant to r 28.2 of the Uniform Civil Procedure Rules 2005 (NSW) ("UCPR") there be a separate determination of the following questions (Magann v The Trustees of the Roman Catholic Church of the Diocese of Parramatta [2018] NSWSC 1551). "(a) An order that any liability of the defendant to the plaintiff (which is denied) was extinguished by operation of a Deed of Release between the plaintiff and the defendant dated 16 October 2007 based on the same cause of action. (b) In the alternative to (a) an order that the terms of a Deed of Release between the plaintiff and defendant dated 16 October 2007 be specifically performed by the plaintiff."
3. As the matters for separate determination were framed in the terms of orders rather than questions, I propose to proceed on the basis that the separate questions for my determination are as follows: 1. Does the Deed of Release dated 16 October 2007 extinguish any liability of the Church in relation to a cause of action arising from the matters contained in the Deed? 2. In the alternative, should there be an order for specific performance of the Deed?

Procedural History

1. The plaintiff, Darren Magann, alleges that two Catholic priests regularly and repeatedly sexually abused him in the 1980s and early 1990s when he was a child.
2. On 19 May 2003, Mr Magann commenced proceedings in the NSW District Court against the Catholic Church and his alleged abusers, Fr Michael McGloin and Dr Henk Eijkman, seeking damages arising out of the sexual assaults alleged to have been committed against him. At the time that Mr Magann filed this Statement of Claim it was subject to certain limitation periods as then provided for by the Limitation Act 1969 (NSW) ("Limitation Act").
3. Although Judge Sorby granted leave for Mr Magann to extend the limitation period, the Church successfully appealed that decision to the Court of Appeal: Eijkman v Magann; McGloin v Magann; Trustees of the Roman Catholic Church of the Diocese of Parramatta v Magann [2005] NSWCA 358 ("Magann CA"). On 4 November 2005, the Court of Appeal held that it was not just and reasonable to extend the limitation periods. Accordingly, Mr Magann's cause of action was statute-barred and dismissed.
4. On 16 October 2007, Mr Magann entered into a Deed of Release with the Church where the parties agreed that, in exchange for a payment of $95,000, he would release and discharge the Church from "all actions, suits, claims and demands of every description past present and future relating to or arising from the Claim or the Complaint or any other matters set out in th[e] Deed".
5. In 2015, the Royal Commission into Institutional Responses to Child Sexual Abuse, Redress and Civil Litigation Report (2015) made the following recommendations at 53: "85. State and territory governments should introduce legislation to remove any limitation period that applies to a claim for damages brought by a person where that claim is founded on the personal injury of the person resulting from sexual abuse of the person in an institutional context when the person is or was a child. 86. State and territory governments should ensure that the limitation period is removed with retrospective effect and regardless of whether or not a claim was subject to a limitation period in the past. 87. State and territory governments should expressly preserve the relevant courts' existing jurisdictions and powers so that any jurisdiction or power to stay proceedings is not affected by the removal of the limitation period. 88. State and territory governments should implement these recommendations to remove limitation periods as soon as possible, even if that requires that they be implemented before our recommendations in relation to the duty of institutions and identifying a proper defendant are implemented."

The hearing of the present proceedings

1. The hearing of the separate question was conducted before me over four days on 18, 19, 29 and 21 March 2019. At the end of the hearing Mr Magann was granted leave to produce supplementary evidence by 18 April 2019 in relation to the timing of the payment to him in 2007. The Church was granted leave to file evidence in reply by 16 May 2019. The last evidence was filed that day. I reserved my decision as at that date.
2. In response to the Church's reliance upon the Deed, Mr Magann challenged the validity of the Deed on a number of bases. First, he contended that it was not the intention of the parties that the Deed prevent Mr Magann from approaching the Church for further assistance. Second, he claimed that he was misled by the Church as to his entitlement and a report of an independent assessor, Ms Robyn Bailey, dated 14 August 2007, was kept from him until after the settlement. He contended that the Church took advantage of his vulnerability by negotiating without the assistance of legal advice, that he lacked capacity to enter the Deed and that the Church applied undue influence and unfair tactics against him. Mr Magann seeks orders under the Contracts Review Act 1980 (NSW) in relation to the Deed and also submitted that the Deed should be set aside on grounds of unconscionable conduct.
3. Although the Church was the party moving the motion, it was accepted by counsel for Mr Magann that, procedurally, Mr Magann's evidence would be called first and that the Church would then call evidence in reply.
4. Eight witnesses gave evidence at the hearing over three days. The following four witnesses gave evidence for Mr Magann 1. Darren Magann; 2. Dr Andrew Robertson, a psychiatrist who prepared reports in relation to Mr Magann on 10 August 2003, 26 September 2018, 2 February 2019 and 9 February 2019; 3. Leanne Magann, who was married to Mr Magann between 2001 and 2015; and 4. Herbert Weller, Mr Magann's solicitor.
5. The following four witnesses gave evidence for the Church: 1. Dr Doron Samuell, a psychiatrist who prepared reports in relation to Mr Magann on 3 October 2018, 26 February 2019 and 8 March 2019; 2. Michael Salmon, the director of the NSW Professional Standards Office of the Catholic Church between 2003 and 2018; 3. Paul Davis, special counsel to the Office of Safeguarding and Professional Standards for the Catholic Diocese of Parramatta; 4. Shane Wall, an independent facilitator engaged by the NSW Professional Standards Office of the Roman Catholic Church to facilitate the Towards Healing complaint lodged by Mr Magann.

The alleged assaults

1. Mr Magann was born on 19 June 1971. He grew up in Tregear in Sydney's West. He was raised in a Roman Catholic Family. His father was an acolyte. He was baptised, confirmed and regularly celebrated weekly mass through the Roman Catholic Church. In 1982, Mr Magann became an altar boy at the Holy Family Parish in Emerton.
2. Mr Magann alleges that from about 1983, when he was 12 years of age, through to 1991, Fr Michael McGloin regularly and repeatedly sexually abused him while he was entrusted to his care, custody and control.
3. From 1984, Fr McGloin started work as an assistant priest at the Holy Family Parish in Mount Druitt. Mr Magann told Ms Bailey that "all the children at the church used to regard Fr McGloin as a role model and thought of him as a 'cool dude'." He remained there until 1986 when he was transferred to the Springwood Parish. Mr Magann claims that the sexual abuse perpetrated by Fr McGloin typically involved him cuddling him and speaking to him intimately. He would lie in bed with Mr Magann, talk intimately, kiss his neck and blow in his ear. He would feel Fr McGloin's erect penis against his buttocks. On occasions, Fr McGloin would place his hands on Magann's buttocks.
4. Mr Magann alleges that Fr McGloin regularly allowed him to stay overnight in one of his residences or his caravan. He also alleged that on one occasion, Fr McGloin encouraged another "young man" who was a member of the parish, to accompany Mr Magann to Fr McGloin's house at Kurrajong under the pretext the two boys might engage in sexual conduct together.
5. As Ms Bailey notes in her report, "… Mr Magann does not allege that McGloin ever engaged, or tried seriously to engage, in sexual intercourse, fellatio or masturbation with him."
6. Fr McGloin denied the allegations when interviewed by Ms Bailey. He stated that he did not have any personal contact with Mr Magann until 1990 (when Mr Magann was 19 years old).
7. Mr Magann also alleges that from about 1987 through to 1989, Dr Hank Eijkman, who was an assistant priest to the parish, regularly and repeatedly sexually abused him while he was entrusted to his care, custody and control.
8. Dr Eijkman came to the Holy Family Parish in 1987 as a new assistant. Ms Bailey describes in her report that he befriended the Magann family during 1987 to 1988 and was a regular visitor at the Magann home. Mr Magann alleges, inter alia, that Dr Eijkman masturbated and fellated him against his will and without his consent.

First complaint to authorities

1. Mr Magann first reported the alleged abuse to police on 6 July 1994 when he was 23 years of age. He was questioned about this in cross-examination. He said he remembered making a statement that Frs McGloin and Eijkmann had sexually abused him. He accepted that in 1994 he had a good recollection of what happened to him and that his statement was a detailed account. He added: "I also remember that the Catholic Church told me that they will look after Michael McGloin, to leave Michael McGloin. That's why there were no charges brought against him. Paul Davis, along with Kevin Manning, told me to leave McGloin alone and they will look after him. So I only had a chance against Hank Eichmann sexually abusing me. That's why you said about an hour ago there were no charges. There has been none because the Catholic Church told me they would look after - they will - how do you say - discipline - they'll belt him up, in other words, what I'm trying to say."
2. Mr Magann explained that he was speaking figuratively when using the expression "belt him up".
3. There was no evidence as to what happened to Mr Magann's police complaint. No criminal proceedings were ever commenced and no evidence was adduced as to why that was.
4. In about 2000, Mr Magann started his own landscaping business. It lasted only a year. Mr Magann's evidence was that "I fizzled out … thanks to the Parramatta Diocese". At some point during this period Mr Magann did so-called "pilot work", namely escorting oversized loads and heavy machinery on the roads. He says he "lost all that work" because he was too angry and had "nearly punched out blokes".

First complaint to the Church

1. In approximately March of 2002, Mr Magann started seeing a psychologist, Judith Carroll, whom he saw "maybe three or four times". He stated that he stopped seeing her because Bishop Wright and Mr Davis "wouldn't pay the bill anymore". He appeared to accept in his evidence that seeing Ms Carroll was good for him: "She brought a lot out because she hated the Catholic Church as well," he said. It is unclear on the evidence as to when it was that the Church started or ceased paying for this counselling.
2. On 5 July 2002, when he was 31 years old, Mr Magann lodged a pro forma statement of complaint form with the Church's Professional Standards Office. At the hearing, Mr Magann was adamant that it was not his handwriting on the form and that he could not remember whose it was. He appeared to accept that it was his signature and also appeared to accept that Ms Paula Kerr assisted him in preparing it.
3. Mr Magann's complaint to the Church was against Fathers Eijkman and McGloin and stated to be in the nature of "emotional, psychological w sexual assault by both priest's over a 6 to 7 yrs period [sic]." Mr Magann indicated that he expected four outcomes: 1. A written and verbal apology from both men; 2. Charges to be brought against both men; 3. Financial compensation for suffering; and 4. Counselling for both himself and his wife.
4. Mr Magann also noted on the form that he had notified the police of his complaints.
5. On 13 August 2002, Mr Magann wrote a letter of demand to Bishop Manning seeking $10,000 for every year Fathers Eijkman and McGloin had "ruined" his life. The letter was typed by Mr Magann's ex-wife, Leanne. At the hearing Mr Magann accepted that he remembered the letter and stated that he "100%" wrote it. In the letter, Mr Magann claimed the abuse had occurred while the priests were under the jurisdiction of the Parramatta Diocese. He stated that it was his intention to have the matter dealt with immediately. He wrote that, should he not receive notification immediately, he would be forced to take legal action.
6. Mr Herbert Weller, Mr Magann's solicitor, attended a meeting on 6 November 2002 with Mr Magann, Bishop David Walker and Mr Bill D'Apice. His recollection is that at the meeting Mr Magann at one stage responded to something said by the Bishop by saying, "If you don't take that back, I'll pick you up and throw you out that fucking window". The meeting concluded shortly afterwards.

The District Court proceedings

1. Mr Magann filed his first statement of claim in the District Court on 19 May 2003. On 7 August 2003, he was examined by Dr Andrew Robertson, consultant forensic and general psychiatrist, for the purposes of obtaining a report for the litigation. I shall return to the contents of that report later in these reasons when considering the question of Mr Magann's capacity.
2. On 26 October 2003, Mr Magann made a second complaint to police. It was common ground that no further action was taken by police at this time either.
3. On 7 January 2004, Mr Magann filed a notice of motion in the District Court seeking an extension of time. It was replaced by an amended notice of motion, filed on or about 4 June 2004, claiming "[t]hat pursuant to sections 58(2), 60C(2) and/or 60G(2) of the Limitation Act the limitation period for the bringing of the cause of action herein be extended."
4. The application was heard by Judge Sorby on 13 October 2004. Mr Magann gave evidence in those proceedings. There was no tutor appointed on his behalf nor was any question of competence raised in those proceedings.
5. His Honour gave his decision on 12 November 2004. As stated above, the Church sought leave to appeal this decision.

The Court of Appeal's decision

1. In the Court of Appeal, Mr Magann was represented by Mr David Russell SC (as his Honour was) and Mr Porthouse of counsel. The Church's application was heard on 16 September 2005. Mr Magann recalls that he did not attend the hearing because Mr Porthouse had said to him, "Don't go. You'll probably get angry". Judgment was delivered on 4 November 2005. As stated above, Giles JA (Hodgson JA and Hunt AJA agreeing) held that leave to appeal should be granted to the defendants, the appeals should be allowed and the grant of an extension of the limitation periods should be set aside. As Giles JA explained in at [4]: "Mr Magann's claim was subject to the limitation periods in the Limitation Act 1969 ('the Act'). There were in the statement of claim a number of causes of action caught by the Act, if each occasion of sexual abuse was a battery and depending how the negligence was said to have caused psychiatric injury. Until Mr Magann reached 18 years of age on 16 June 1989 the running of the limitation periods was suspended (ss 11(3)(a); 52(1)). So far as any of the causes of action accrued prior to 17 June 1989, the limitation period was six years and expired on 16 June 1995 (s 14(1)(b)). So far as any of the causes of action accrued thereafter and prior to 1 September 1990, the limitation period was six years and the last limitation period expired at the latest on 31 August 1996 (ibid). So far as any of the causes of action accrued on or after 1 September 1990, the limitation period was three years and the last limitation period expired at the latest at the end of 1994 (s 18A(1), (2))."
2. Mr Weller acted for Mr Magann at this time. Mr Magann accepted in his evidence that he met with Mr Weller on various occasions and spoke to him on the telephone to discuss the case and to get the statement of claim ready to file. He said he thinks he met with a barrister, Mr Anthony Porthouse, once "at Herbert's office" and once at the Parramatta courthouse prior to the hearing before Judge Sorby.

The "Towards Healing" process

1. On 8 December 2005, Mr Weller wrote to the Church's legal representatives. He stated that, notwithstanding the Court of Appeal's decision, Mr Magann wished "to be considered for appropriate compensation" and that he was "instructed to propose a Mediation Conference with an experienced Mediator to effect a fair and compassionate resolution of the matter".
2. Sometime later, by way of a letter dated 21 March 2007, Ms Robyn Bailey was appointed by the Church to assess Mr Magann's complaints against Dr Eijkmann and Fr McGloin. She was asked to investigate and report on whether there were grounds for concluding on the balance of probabilities that his complaints were justified either totally or in part. In doing so, she had regard to the principle in Briginshaw v Briginshaw (1938) 60 CLR 336 at 361-362; [1938] HCA 34.
3. On 28 March 2007, Ms Bailey attended an initial briefing at the Professional Standards Office. She was given a bundle of documents relevant to her inquires. She subsequently conducted a series of interviews with Mr Magann, in person and by phone; Mr Magann's legal representatives, including Mr Russell and Mr Weller; Mr Greg Walsh, solicitor for Dr Eijkman; Fr McGloin; and Peter and Susan Magann.
4. In reviewing the evidence, Ms Bailey noted that Fr McGloin's assertion that he did not have regular contact with Mr Magann until 1990 was "undermined significantly by the evidence of Mr and Mrs Magann Snr". Although it might be reasonably expected that Mrs Magann would support her son, Ms Bailey noted that "it became apparent … during the course of the investigation, that Mr Magann is essentially estranged from his family." She found that there was "no reason to infer" that Mrs Magann's evidence was "biased or unreliable".
5. Ms Bailey found that, on balance, Mr Magann did visit the presbytery on occasions during the time Fr McGloin was at the Holy Family Parish. There was, however, no evidence to corroborate Mr Magann's account that he stayed overnight there. She also noted that when Fr McGloin was confronted with information that tended to undermine his first "adamant and definite" account, his second account was "far less adamant about certain aspects of the allegations". Indeed, Ms Bailey noted, "he admitted hugging Mr Magann and blowing in his ear, having previously refuted it, although denied that there was any sexual motivation in his actions."

The fact finding process

1. The facts I have found thus far were largely not in dispute. The first significant dispute concerns the date upon which Mr Magann was provided with a copy of Ms Bailey's report.

Provision of Ms Bailey's report to Mr Magann

1. Contemporaneous documents show that on 31 August 2007 Mr Salmon sent Mr Davis some proposed redactions to Ms Bailey's report (in relation to the personal details of various people). Mr Salmon's evidence was that this was "so that we are able to forward a copy of the document to Darren Magann as soon as practicable".
2. On 11 September 2007, Mr Magann met with Mr Salmon and Mr Davis at the Church's Professional Standards Office in Sydney. Mr Salmon's evidence was that he handed an edited version of Ms Bailey's report to Mr Magann at that time. His copy of the report, which was produced in evidence, had the following words written on it: "Final edited version handed to DM at PSO on 11/9". Mr Salmon also prepared a contemporaneous file note on the day recording the meeting.
3. Mr Magann claims not to have received Ms Bailey's report until seven to nine days after the subsequent "settlement" meeting. Mr Magann's evidence was that "I did not see the report of Miss Robyn Bailey until about a week after receiving the payment of compensation of $95,000 provided for in the deed of release". He repeated in cross-examination that he had only received the report a week after payment was made.
4. Mrs Magann's evidence was also that she had a "clear recollection" of Mr Magann receiving the report of Ms Robyn Bailey after the meeting held on 16 October 2007. She stated "I remember him saying to me, '[t]his is the first time I have seen this report. At last someone believes me.'" As to timing she stated: "Q. When did you see the report, of Robin Bailey? A. I came home from work, Darren was sitting in - on the edge of the bed in our bedroom and I walked in and that is when I saw it, he handed it to - to me and told me what it was. Q. Can you help as to the timing‑‑ A. That was after the meeting. Q. How long after the meeting, are you able to say? A. At least - at least a week, at least."
5. The evidence of both Mr Davis and Mr Salmon was that Mr Magann was given a redacted version of the Assessment Report of Ms Bailey at the meeting on 11 September 2007 when Mr Magann attended the Professional Standards Office.
6. Mr Wall also gave evidence that he spoke to Mr Magann in the days leading up to the settlement meeting. His evidence was that, on the first occasion they spoke about the meeting, Mr Magann said to him that he would only attend the meeting if he received $150,000 in settlement. Mr Wall suggested that he speak to his lawyer. The second time that Mr Wall spoke with Mr Magann about the meeting Mr Magann told him that he had spoken to Mr Weller and Mr Russell and had been advised to attend the meeting and seek a resolution and also to ensure that a Deed of Release was prepared and payment made within seven days.

The Blacktown meeting

1. Putting to one side for the moment the question of whether Mr Magann was provided with a copy of Ms Bailey's report before the meeting, the settlement meeting was held on 16 October 2007. An issue arose at the hearing as to precisely where the meeting took place. The witnesses for the Church gave evidence that it took place at the Blacktown Travelodge whereas Mr Magann insisted it took place at the Blacktown Sports Club. Given that both venues are next door to each other and serviced by the same driveway I do not consider it necessary to make any particular finding on this issue.
2. Present at the meeting were Mr and Mrs Magann, Mr Wall and Mr Davis. There were a number of disputes as to what was said at the meeting and what Mr Magann's demeanour was at that time.
3. Mr Magann's evidence was that Mr Davies said at the meeting that Fr McGloin "was a bit light-fingered and we know that his history isn't good". He also claimed that Mr Wall said "I don't want you to come back ever again" as well as "[look] these cases only go for about $40,000, take the $85,000 that you've been offered". Once the offer of $95,000 was made, Mr Magann stated that Mr Wall said "I don't want to be here all day take this offer as you won't be getting anymore. Take it and try and live the best life you can. That's all you're getting, if you want this money you have to take the deed back to Herbert Weller and get it signed and back to me today and I will make sure the $95 000 is in your bank account by 5:00pm".
4. Mrs Magann's evidence was that Mr Davies told Mr Magann that he had to sign the Deed the day of the meeting and that Mr Magann was a "rollercoaster of emotions". She described him as "aggressive" and "confused about what was being said". She also described him thumping the table at one stage.
5. Mr Wall's evidence was that Mr Magann was polite and respectful at the meeting but expressed disappointment at the initial offer of $85,000. Mr Wall stated that Mr Davis left the room to make a few phone calls. When returning, Mr Magann was offered another $10,000 and accepted, apparently "satisfied with the offer and happy with the outcome". Mr Wall also stated that he said to Mr Magann that "[y]ou will have to have the Deed explained to you by your solicitor before any settlement is finalised." To Mr Wall's observation, Mr Magann did not appear angry at this meeting. Mr Wall denied telling Mr Magann that he should immediately take the offer.

The provision of legal advice by Mr Weller

1. Following the meeting at which he received the Deed, Mr Magann drove to Mr Weller's office in Windsor.
2. Mr Weller's evidence was that he saw Mr Magann in his office on 16 October 2007. He stated that he was not privy to the settlement conference which Mr Magann had attended at the Blacktown Sports Club. His evidence was that Mr Magann said to him that he had been told by Mr Davies that he had to sign the document on that day so that he could receive a lump sum of $95,000 in his bank account on that day by 5:00pm.
3. Mr Weller stated that when Mr Magann told him that the Church had offered him $95,000, he told Mr Magann, "The Court of Appeal has said you are not entitled to anything. This must be a gift from God. A pound out of the Poor Box."
4. He was cross-examined about this evidence at the hearing and the following exchange took place: "Q. And you knew that on 16 October there'd been a settlement conference that had taken place between he and the church, seeking to resolve his complainant against the church. A. Yes. Q. And you had been his solicitor at that point for at least three or four years. A. Yes. Q. And you'd been his solicitor in connection with, the very subject matter of the settlement conference which was his claim for payment from the church in relation to the abuse that he'd suffered. A. Yes. Q. And when he went to you and said I've been offered $95,000 you must have understood that, one of his expectations was for you to tell him whether you thought that was something that he should accept. A. Well, I'll repeat what I've already said, he'd already accepted it he was going to be paid $95,000 when he got this document signed by himself and myself and he returned it to the church."
5. Mr Weller's evidence was that at this time Mr Magann was standing on the other side of the desk. He agreed that he would have looked at the Deed in order to find out what it was. He said that he did not pay much attention to the details of Mr Magann's obligations to the Church under the Deed. The following exchange explains why he took that position: "Q. If you go to the following page, page 64 in the bundle. When you signed this, you would have understood that he had various obligations under the deed as well - sorry, in addition to the obligation of the diocese to pay the $95,000? A. I didn't pay any attention to these things, they were insignificant to me. He had no rights, he had no rights against the church, they were offering $95,000 and I didn't spend much time with him at all that day. Q. So, you thought this was a very good deal and he should be accepting it? A. If he could get any money out of the church, it would be helpful for him. Q. Sorry? A. It was helpful for him. Q. You said, you tell us in your affidavit, that you said to him‑‑ A. A gift from God. Q. So‑‑ A. A pound out of the poor box. Q. So, really, what you were intending to convey to him was that he should accept this offer? A. Well, he'd already accepted it, he just needed this document signed."

The terms of the Deed

1. The Deed is dated 16 October 2007. Given its prominence in the present application, it is necessary to set it out in full.
2. The recitals to the Deed are as follows: "A. Mr Magann registered complaint with the New South Wales Police amounting to allegations of sexual assault in the period 1987 - 89 against Fr Henk Eijkman in July 1994. B. Mr Magann. registered a Statement of Complaint with the NSW Professional Standards Office on 9 July 2002 against the then Fr Henk Eijkman and Fr Michael McGloin now retired) regarding allegations of psychological and sexual assault which spanned over the period of 1981-89. C. Mr Magann commenced civil proceedings in the District Court of New South Wales against the Trustees of the Roman Catholic Church of the Diocese of Parramatta &Ors No 2134/03 seeking damages fro [sic] negligence and breach of duty of care in respect of the alleged assault (the Proceedings). D. In his decision of 12 November 2004, Sorby, J [sic] granted leave for Mr Magann to file a Statement of Claim out of time. This decision was subsequently the subject of Appeal. On Appeal Mr Magann was denied the opportunity to commence proceedings for negligence and breach of duty of care against the Trustees of the Diocese of Parramatta and Ors. E. The Professional Standards Office in collaboration with The Diocese of Parramatta commissioned an Assessment of the complaints of Mr Magann in March 2007. This process of investigation was completed and a report was prepared dated 14 August 2007. F. The Diocese, without admitting liability, and Mr Magann have reached agreement on the terms set out in this Deed."
3. The following terms are defined in cl 1: "'Claim' means and all actions, obligations, sums of money, accounts, charges, claims, investigations, demands, suits, proceedings, causes of action, damages, debts, costs, verdicts and judgments whatsoever whether at law or in equity or under any statute, arising under any award, enterprise agreement or this instrument made or approved under any law but does not include any claim that may be brought pursuant to workers' compensation legislation. 'Complaint' means all matters, issues and allegations of psychological and sexual abuse registered by Mr Magann. 'Diocese' includes the Bishop of Parramatta, all prior and future Bishops of Parramatta, all former and present clergy of the Catholic Diocese of Parramatta, the successors and assigns of the Trustees of the Catholic Diocese of Parramatta. 'Mr Magann' includes the successors, assigns and estate executors or administrators of Mr Magann."

Contemporaneous documents

1. There are a number of contemporaneous documents concerning what happened after the Deed was signed by Mr Magann and Mr Weller.
2. Mr Magann returned the Deed on 16 October 2007, the same day he signed it. He sent an accompanying letter to Bishop Manning, handwritten in the following terms: "Dear Bishop Manning Enclosed is the signed 'Deed of Release' by both myself + my solicitor Herbert Weller. I would ask that you return to me a signed copy of this in the Express Post envelope provided asap. I hope that we can put this behind us and start 'fresh' and I hope that in the near future we may be able to sit down and chat over a cup of tea. Remaining Yours DARREN MAGANN"
3. Mr Magann contends that on that same day Bishop Manning wrote to him forwarding him a copy of Ms Bailey's report. He asserts that the letter included the words "I understand that you have received an extract of the report completed by Ms Robyn Bailey who I engaged to undertake a comprehensive assessment of your claim." He asserts that he did not receive this latter and report until a week later. No copy of this letter has been produced by Mr Magann.
4. Early on 17 October 2007, (the day after the Blacktown meeting), Mr Wall sent an email to Mr Davis confirming the outcome of the previous day. After recounting who was in attendance, Mr Wall outlined the purposes of the meeting: "The meeting was convened to seek to bring to resolution outstanding issues and grievances relating to Darren's Towards Healing complaint and relating to abuses as detailed in the Assessment Report prepared by Ms Robyn Bailey and regarding Fr Michael McGloin and (former priest) Dr Henk Eijkman."
5. Mr Wall then set out his account of what occurred at the meeting: "Paul Davis presented a letter of acknowledgement signed by Bishop Kevin Manning regarding the complaint and impact of the abuse. Darren and Leanne read the letter and Darren was appreciative of the gesture. Darren stated that he wanted $150,000 in recognition of the abuse by McGloin and Eijkman and to fund future counselling. He produced a current Medicare Australia Notice of Charge which indicated 'Nil Obligations' payable as reimbursement to the Government dated 12th October (ref: 50272263N). The Notice is valid until 12th October 2008. Paul Davis produced and explained in detail a Deed of Release and stated that no resolution would be considered or recognised until and unless Darren signed such Deed and obtained independent legal advice before executing the Deed. It was explained that the implication of signing the Deed gave effect to resolution of his complaint and no further action could be reactivated or revisited. Darren requested that, if resolution was achieved, payment be effected within 7 days rather than 28 days."

The timing of the payment

1. Although it was common ground that the Church made the payment of $95,000 to Mr Magann, a dispute arose as to when that payment was received. The Church records show he was paid on or around 18 October 2007 whereas Mr Magann insisted that he was paid on the same day as the settlement, namely 16 October 2007.
2. The relevance of the timing of the payment is that Mr Magann asserted that pressure was put on him in the meeting to accept $95,000 by the promise of receiving it that same day. During the hearing, Mr Magann became quite agitated and made a number of attempts to obtain bank records to disprove the evidence of the Church as to the timing of the payment. He was unable to do so. In light of this, as I have stated above, at the conclusion of the hearing I afforded him some extra time to do so.
3. Following those orders, an affidavit of Darren Magann sworn on 16 April 2019 (with annexures) and an affidavit of Lisa Leslie sworn on 16 April 2019 (with annexures) were forwarded and relied upon by Mr Magann and an affidavit of Alexander Kohn sworn on 16 May 2019 (with annexures) was relied upon by the Church.
4. The file note at [105] above suggests that the money went into an ANZ account. The Church's recent correspondence suggests it went into a NAB Account. Mr Magann's most recent evidence is that this nominated NAB account was not opened until 4 March 2013. The ANZ Bank, both at Windsor and Martin Place, confirmed no record of payment of $95,000 but individuals at those banks (and Westpac) informed Mr Magann that records of accounts dating back more than seven years are not kept.
5. In short, Mr Magann was not able to provide any documentation to suggest he was paid on 16 October rather than 18 October 2007.

Factual findings on disputed issues

1. The resolution of the relevant factual disputes in this matter turns on the reliability of the various witnesses in the context of contemporaneous documentation.
2. It is necessary for me to first make an assessment of the evidence of Mr Magann. I have had regard to the expert evidence regarding the symptoms of PTSD when assessing his evidence. Mr Magann presented as an angry and damaged man. His PTSD symptoms were evident and he could barely suppress his rage at the way the Church has dealt with his complaints. As I understand this condition, the longer the period in which PTSD is untreated, the more difficult it is to be cured of it. It also seems to me that Mr Magann's grievance stems not only from the alleged assaults but also his long fight for compensation and the position he now finds himself in; the previous legislative barrier to bringing court proceedings now having been removed.
3. It became clear during his evidence, that part of Mr Magann's ongoing grievance is that the relevant priests were never prosecuted. There was no evidence before me as to why that was the case. Mr Magann asserts that it is the fault of the Church but that does not explain why police did not act on the statements he made to them. To the extent that it was necessary for me to do so, I am unable to make any finding on this issue
4. I am satisfied that Mr Magann is driven by a deep desire to put the past behind him and he considers the best way to do this is to receive a significant lump sum payment from the Church, and, also, to have the relevant priests prosecuted. Regrettably, his deep passion for this result was reflected in his evidence. Mr Magann was a difficult witness who continually volunteered non-responsive answers to criticise the Church at every available opportunity. When he was cross-examined he stated that he was "violated once more" by having to give evidence again. "We shouldn't all be here," he said. I am satisfied that he fully understood the questions being asked by him but he persisted to advance his own narrative, rather than answer the questions put to him in cross-examination.
5. A further difficulty for Mr Magann is that many of his assertions as to what occurred on and around 16 October 2007 are not consistent with the contemporaneous documents.
6. In the context of these observations I make the following findings.

Later events

1. There was evidence that after Mr Magann was given the $95,000 the Church gave him some additional funding towards the end of 2007: $7,500 for a ute, $9,000 for a caravan and $24,000 for legal costs.
2. As to what occurred between 2007 and 2014, no evidence was provided but at some stage Mr Magann was interviewed by someone from the Royal Commission which led him to write the following typed letter to Mr Salmon on 21 January 2014: "Michael iam writing to you in hope that you or the professional standards can reassess my towards healing again it has been pointed out to me that there was a great deal of wrongs with my case. Michael as you know michael mcglion and henk ikman along with other members of the church sexually mentally emotional abused me and they still do to this day i have spoke to other members of the catholic church and the Royal Commisiom about this matter Michael i will say this you as the director of the professional standards should off helped me more i don't understand why you / the church didn't give me the right help that i needed.Michael Salmon as i have spoke and called you a few times even after the church had payed me there was no help if you can recall i rang you ,you hade told me that there is no need for the professional standards to help anymore and in fact we don't help we just rather you find yr own way and be happy with wote happens end of the day Michael i have bn told that the church has and had payed out the same money to victims, iam asking to be re assess my claim and keep in mind that there were TWO(2) catholic priests not ONE(l) .Michael what iam asking of you is to re assess is my payment for TWO(2) catholic priests not ONE(1) and to ask for some of the money from me paying my legals back wich was $23,000,00 Michael it is wrong of what the church has done to me but ONE DAY THERE WILL BE MORE PEOPLE THAT WILL COME FORWARD TO SAY mcgloin or ikman has abused me i hope that you and the church help them more than what you did for me" (Sic, as in original.)
3. After this letter Mr Magann was given $23,000 for his legal costs in April 2014. In October 2014 he was provided (through another person) with $7,000 to help him buy a car and get accommodation. In May 2015 he was paid $3,131 for further legal costs and in December 2015 the amount of $2,535 was paid for his psychiatric assessment. In March 2016 the amount of $4,500 was paid for rent, the amount of $5,000 for legal costs, $3,000 was paid back to Medicare and the amount of $314 was paid for his bed. In June 2016 the amount of $186 was paid for his travel expenses and in December 2016 the amount of $25,989 was paid to his solicitor. In addition to these amounts, $11,500 was paid towards his rent payments. On my calculations, Mr Magann has been paid an amount of about $200,000 inclusive of the payment under the Deed.

Dr Robertson

1. Dr Robertson was called as an expert witness for Mr Magann. He completed four reports relating to Mr Magann. Two were based on clinical examinations of the plaintiff. One examination took place on 7 August 2003 (for the District court proceedings) and the other on 26 September 2018. On the basis of his consultation with Mr Magann in 2003, he was asked to express his opinion about Mr Magann's capacity as at the 2007 meeting. Mr Magann relies upon Dr Robertson's report of 26 September 2018 in seeking to establish that he did not have the mental capacity on 16 October 2007 to decide whether or not to enter into the settlement on the terms set out in the deed of release.
2. Dr Robertson's evidence-in-chief was that when he read Ms Bailey's report in April 2007, it confirmed his belief that when he saw Mr Magann in 2003 "he was very much affected by alcohol induced brain injury" and he thought that "this was likely to have continued for the four years" between 2003 and the Blacktown meeting in October 2007.
3. In cross-examination Dr Robinson accepted that the best he could say as at 9 February 2019 was that it was "very doubtful" whether Mr Magann had mental capacity in 2007. His evidence was that it was "probable", although he "couldn't be certain" that in 2007 Mr Magann did not have the capacity to understand what he was doing.
4. In his report dated 9 February 2019, Dr Robertson was "doubtful" that Mr Magann had the requisite mental capacity to enter the deed in 2007. His opinion was that his condition had "improved tremendously" since then. In 2018 he was "astonished" with his improvement and, his opinion was that Mr Magann was now competent to give instructions. Mr Gyles SC suggested to Dr Robertson that if Mr Magann did not have the mental capacity to make decisions for himself in 2003 he would have said so in this report. Dr Robinson replied "Yes, I would have said something to that effect, yes". Mr Gyles pointed to the inconsistencies between the 2018 and 2003 reports in so far as they did and did not, respectively, make reference to so-called "wet brain" or other cerebral impairment". The cross-examination continued as follows: "Q. --you say [at p 3 of the 2003 report], 'There were no features of psychotic illness. He did not appear to be at all intoxicated. And there was nothing to suggest clouding of consciousness or organic cerebral impairment.' A. Yes. Q. So you're saying that whether or not you believed his history in relation to alcohol abuse, doing the best you could in August 2003, you did not see any cerebral impairment. A. That's a mistake on my part. I think he certainly had organic cerebral impairment."

Dr Samuell

1. Mr Doron Samuell is a clinical and forensic psychiatrist who was engaged by the Church to provide an opinion about whether Mr Magann had capacity to sign the Deed. He evaluated the evidence contained within Dr Robertson's report, as well the affidavits of Mr Wall and Mr Davis.
2. Mr Samuell noted that, in his opinion, Dr Robertson obtained very little history concerning Mr Magann's functioning during 2007. He wrote that "in the mental state examination presented by Dr Robertson, there was a mixture of observations and discursive reflections that were irrelevant to a mental state examination". In his opinion, Dr Robertson did not provide evidence or argument to support the assertion that Mr Magann did not have capacity when signing the Deed. He stated that Dr Robertson did not provide evidence for his conclusion that Mr Magann was brain damaged and was deficient in not conducting a clinical assessment. His conclusion was that "Dr Robertson's report is seriously flawed and cannot be relied on to assert incapacity".

Dr Zolfaghari

1. On 10 July 2006, Dr Fazeela Zolfaghari, clinical psychologist, wrote to the Director of Victims Services at the NSW Attorney General's Office. Mr Magann was referred to Dr Zolfaghari for an authorised report "in regard to an act of violence for the purposes of Victim's Compensation assessment by the Victims Services." She commented that, even though Mr Magann attended the scheduled appointment on 7 October 2005 that "it was not possible to conduct an adequate assessment" due to the fact that he was "very belligerent, uncooperative and angry". She noted that he "showed little capacity to listen to another's view point and appeared quite entitled". Mr Magann apparently angrily told the doctor that she "had little understanding of how difficult this whole 'thing' was for him and how his health (mental) had become worse since all this came to the fore."
2. In view of this, Dr Zolfaghari was unable to conduct a thorough assessment. However, based on her interactions with him as well four other reports, she was able to form the opinion that Mr Magann's symptoms were clinically significant and in a severe range. She concluded that Mr Magann had developed Chronic Posttraumatic Stress Disorder as well as many of the features for an Axis II disorder of the type of Borderline Personality Disorder. On the whole, she rated his symptoms at a very severe level of distress and that the alleged act of violence and subsequent symptoms had adversely and significantly impacted on his functioning.

Dr Boettcher

1. On 17 October 2002, Dr Brian Boettcher, Consultant Psychiatrist in General and Forensic Psychiatry, prepared a report for the Church's solicitors.
2. Mr Magann's evidence at the hearing was that he did not know Dr Boettcher: "I don't even remember going and speaking to him," he said. He rejected Dr Boettcher's statement that his ex-wife helped him with his alcohol problem.
3. In the report, Dr Boettcher's diagnosis was that Mr Magann has Post Traumatic Stress Disorder, as he "just fulfilled" several of Diagnostic Criteria for the Disorder. These criteria were: 1. The traumatic event is persistently re-experienced in one (or more) ways: 1. Recurrent and intrusive distressing recollections of the event, including images, thoughts or perceptions. 2. Recurrent distressing dreams about the event. 3. Acting or feeling as if the traumatic event were recurring (includes a sense of reliving the experience, illusions, hallucinations and dissociative flashback episodes, including those that occur on awakening or when intoxicated). 4. Intense psychological distress at exposure to internal or resemble an aspect of the traumatic event. 5. Physiological reactivity to internal or external cues that symbolise or resemble an aspect of the traumatic event. 1. Persistent avoidance of stimuli associated with the trauma and numbing of general responsiveness (not present before the trauma): 1. Efforts to avoid thoughts, feelings, or conversations related to the trauma. 2. Efforts to avoid activities, places, or people that arouse recollections of the trauma. 3. Restricted range of affect (e.g. unable to have loving feelings) . 1. Duration of the disturbance (symptoms in Criteria B, C and D) is more than 1 month. 2. The disturbance causes clinically significant distress or impairment in social, occupational, or other important areas of functioning.
4. Dr Boettcher also noted that many of Mr Magann's features are those of an Anti-Social Personality Disorder which start in the early teens. He stated the distinction between these diagnostic categories could only be clarified with more evidence from Mr Magann's school reports and interviews with relatives.

The Parties' Submissions

1. I will address the respective submissions in more detail in my consideration below but in broad terms they were as follows.

Mr Magann's submissions

1. It was submitted that the conduct of the Church was unconscionable because it did not provide Mr Magann with a copy of Ms Bailey's report, nor permit him to have a lawyer at the meeting, nor satisfy itself that he had sufficient legal advice before signing the release. Reliance was placed on the versions of events provided by Mr Magann, Mrs Magann and Mr Weller.
2. It was submitted that the Deed does not finally determine the issues between the parties because of the subsequent payments. That is, the fact that the Church continued to pay for counselling for Mr Magann after he signed the Deed is inconsistent with any intention on the part of the Church that the Deed actually release the Church of any further financial obligations.
3. It was further submitted that the plaintiff's mental state was relevant to his vulnerability and capacity to deal with matters. It was contended that the Church deliberately arranged the settlement conference to take advantage of his vulnerability and to influence him without the assistance of any legal advice. Reliance was placed on the fact that the payment was conditional on the deed being signed on that day.
4. Reliance was placed on the decision in The Owners Corporation of Strata Plan 61390 v Multiplex Corporate Agency Proprietary Limited and Ors (No 2) NSWSC 322, in which Pembroke J observed at [29] that "equity permits an investigation of the circumstances including consideration of the actual intentions of the parties in order to determine whether enforcement of the general words of a release would be against conscience"
5. As for the question of capacity, Mr Magann relied upon the evidence of Dr Robertson, who opined in October 2018 that he "doubted" that the plaintiff would have had the mental capacity in October 2007 to decide whether or not to accept the terms of settlement offered and sign the Deed. Dr Robertson noted his barely controlled rage and opined that it was probably the result of "wet brain" and that his IQ is, at best, in the dull normal range and this would limit his ability to make a sound decision.
6. It was further submitted that the relevant principles are to be found in the decisions of Gibbons v Wright (1954) 91 CLR 423; [1954] HCA 17, Wilton v Farnsworth (1948) 76 CLR 646; [1948] HCA 20 and Louth v Diprose (1992) 174 CLR 621; [1992] HCA 6. The decision of the High Court in Thorne v Kennedy (2017) 263 CLR 85; [2017] HCA 49 at [38] was also relied upon.

The Church's submissions

1. The Church relied upon the terms of the Deed and submitted that the language was clear and unambiguous. Clauses 5.1 to 5.3 clearly express that the plaintiff is not entitled to make any further approach to the Diocese for assistance, damages or otherwise.
2. It was submitted that there was a commonality of issues between the unconscionability claim and the Contracts Review Act claim. The relevant questions were identified as whether the Church behaved unconscionably by: 1. Failing to show the Bailey report to Mr Magann prior to the settlement meeting; 2. Negotiating with the plaintiff without having the benefit of legal advice; 3. Offering payment to him on the same day; and/or 4. Misleading him about his entitlement by suggesting that similar cases were usually settled for $40,000.
3. It was submitted that if the facts underpinning these submissions are found in favour of the Church then this aspect of Mr Magann's defence must fail.
4. As for whether Mr Magann was operating under some special disadvantage in the negotiations, it was submitted that the facts do not show this, nor is there any evidence that the Church was aware of anything of that nature. It was submitted that there was no evidence that the Church took an unconscientious advantage of any opportunity in this regard. In fact, it was submitted that the evidence shows that it Church went out of its way to ensure that Mr Magann received legal advice about the agreement
5. The Church submitted that there is obviously a very high onus in terms of proving incapacity.
6. The Church also submitted that there is a very strict time limitation for bringing claims under the Contracts Review Act. There is no power of the court to extend that time. The Church also relied upon delay in relation to Mr Magann's equitable claims.

Consideration

1. Although I expressed some concern at the hearing of this matter as to whether this was an appropriate matter for a separate question, I am now satisfied that it was. As Ball J observed in Griffin Energy Group Pty Ltd (subject to a Deed of Company Arrangement) v Laughland [2016] NSWSC 1057 at [128]: ".. the position remains that the court should only make an order for separate questions where, to quote from Kirby and Callinan JJ's judgment in Tepko Pty Ltd v Water Board [2001] HCA 19; (2001) 206 CLR 1 at [170], the "utility, economy, and fairness to the parties are beyond question": see Solarus Projects v Vero Insurance (No 5) [2013] NSWSC 1966 at [22] (Campbell J), approved by the Court of Appeal in AAI Ltd t/a Vero Insurance v Solarus Projects Pty Ltd (Receivers and Managers Appointed) (In Liq) [2014] NSWCA 168 at [13] (Leeming JA); [22]-[23] (Barrett JA); Allandale Blue Metal Pty Ltd v Roads and Maritime Services [2013] NSWCA 103 at [91] (Ward JA)."
2. I am satisfied that, despite this separate question occupying four days of hearing time, a number of factual disputes and significant reading time, the "utility, economy and fairness to the parties" did weigh in favour of this question being answered separately. A finding that the Deed signed by Mr Magann is valid inevitably means that the Church has a complete defence to these proceedings.
3. The separate question is framed in the alternative: 1. Does the Deed of Release dated 16 October 2007 extinguish any liability of the Church in relation to a cause of action arising from the matters contained in the Deed? 2. In the alternative, should there be an order for specific performance of the deed?
4. The first question requires determination of four separate questions: 1. Whether the deed is unenforceable because the intention of the parties was that it should not bind the parties finally to the agreement. 2. Whether Mr Magann had the mental capacity to both accept the terms of settlement offered by the Church and enter into the Deed on 16 October 2007. 3. Whether the plaintiff is entitled to relief under the Contracts Review Act. 4. Whether the Deed is unenforceable and should be avoided because of the alleged unconscionable behaviour of the Church.
5. Before turning to consider these four questions, I will first briefly set out the relevant provisions of the Amendment Act to explain why Mr Magann cannot rely upon that legislation.

Question 1: Intention of the parties to the Deed

1. I will first address Mr Magann's contention that he did not intend to surrender rights he did not know might accrue in the future. The resolution of this question involves construction of the Deed.
2. The relevant clauses in the deed are cl 3.1 and cl 5. I have already set the terms of the Deed out above but shall do so again for ease of reference.
3. In cl 3.1 Mr Magann agreed to: "Release and discharge the Diocese from all actions, suits, claims and demands of every description past present or future relating to or arising from the Claim or the Complaint or any other matters set out in this Deed".
4. In cl 5 is headed "Release" and is in these terms: "5.1 Mr Magann releases the Diocese, its related agencies, its current and future Bishops, trustees, clergy, officers, employees and agents from all actions, suits, claims and demands of every description past present or future relating to or arising from the Claim or the Complaint or any other matters set out in this Deed. 5.2 The Diocese may plead this Deed in bar to any claim or proceeding by Mr Magann or any person claiming on his behalf in respect of the Complaint or any related matter. 5.3 Mr Magann acknowledges that by accepting the payment specified in this Deed and executing this Deed he is not entitled to make any further approach to the Diocese for assistance, damages or otherwise."
5. A release clause is to be construed in accordance with its purpose. As Lord Bingham observed in Bank of Credit and Commerce International SA v Ali [2002] 1 AC 251; [2001] UKHL 8 ("BCCI v Ali")at [8]: "In construing this provision [the release clause], as any other contractual provision, the object of the court is to give effect to what the contracting parties intended. To ascertain the intention of the parties the court reads the terms of the contract as a whole, giving the words used their natural and ordinary meaning in the context of the agreement, the parties' relationship and all the relevant facts surrounding the transaction so far as known to the parties. To ascertain the parties' intentions the court does not of course inquire into the parties' subjective states of mind but makes an objective judgment based on the materials already identified. The general principles summarised by Lord Hoffmann in Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896, 912-913 apply in a case such as this."

Mr Magann's capacity to enter the Deed / give instructions

1. The relevant principles pertaining to the question of capacity to enter a binding transaction were considered by the Court of Appeal in Hanna v Raoul [2018] NSWCA 201 per Beazley P, with whom Macfarlan and White JJA agreed. Her Honour observed the following at [47]-[51]: "A person will lack the mental capacity to enter into a binding transaction if they are not capable of understanding the general nature of what they are doing or do not have the capacity to understand the transaction when it is explained. Whether a person has capacity will depend on the particular transaction in question: see Gibbons v Wright (1954) 91 CLR 423; [1954] HCA 17; Guthrie v Spence (2009) 78 NSWLR 225; [2009] NSWCA 369. In Gibbons v Wright, the High Court stated, at 437, that: "The law does not prescribe any fixed standard of sanity as requisite for the validity of all transactions. It requires, in relation to each particular matter or piece of business transacted, that each party shall have such soundness of mind as to be capable of understanding the general nature of what he is doing by his participation." Their Honours continued, at 438, as follows: "… the mental capacity required by the law in respect of any instrument is relative to the particular transaction which is being effected by means of the instrument, and may be described as the capacity to understand the nature of that transaction when it is explained." Their Honours explained that the "nature of the transaction" refers to "the broad operation" or "general purport" of the instrument. However, in some cases, it may mean the "effect of a wider transaction which the instrument is a means of carrying out". It is also necessary, for a transaction entered into by a person without the required capacity to be voidable, that the other party to the transaction have knowledge of the incapacity: see Gibbons v Wright at 441. It should be noted that there is an unresolved question whether actual knowledge of the incapacity is required or whether constructive knowledge is sufficient: see Public Trustee (WA) v Brumar Nominees Pty Ltd [2012] WASC 161 at [90]-[96]. Putting that question to one side for the moment, it is necessary to ascertain whether Mr Raoul, for his part, satisfied the test for incapacity as stated by the High Court in Gibbons v Wright."
2. In Borchert v Terry [2009] WASC 322, Martin J considered a pleading of incapacity by a victim of sexual abuse in relation to a deed of settlement. His Honour observed at [69]: "Here, Jessica was robustly represented over time by what presented the defendants to be competent solicitors, who undeniably carried primary responsibility for satisfying themselves as to their client's ability to instruct them and to understand their advice to her. It is to be expected that the defendants' solicitors would extend a reasonable degree of deference as to the views of the solicitors for Jessica on the issue of her capacity. I make that observation in the complete absence of any material raised, let alone pleaded, to indicate that Corsers were not acting competently or appropriately in Jessica's interests over the period of some five years."

Questions 3 and 4: The Contracts Review Act/Unconscionability

1. In Spina v Permanent Custodians Ltd [2009] NSWCA 206; (2009) 14 BPR 26;923, Tobias, Campbell and Young JJA held at [74] that, where the Contracts Review Act and unconscionability are both pleaded, it is appropriate to deal with the Contracts Review Act claim first. As Young JA observed: "Not only is the jurisdiction probably wider under that Act than when dealing with equitable principles of unconscionability, but where, as has happened time and time again through history, statute has been enacted to cover the same ground as an equitable principle, the equitable principle is usually put into abeyance. After all, equity only operates where the common law is inadequate."
2. Accordingly, I shall deal with Mr Magann's reliance upon the Contracts Review Act first.
3. The Church initially relied on the statutory limitation pursuant to s 16 of the Contracts Review Act which provides that: An application for relief under this Act in relation to a contract may be made only during any of the following periods: (a) the period of 2 years after the date on which the contract was made, (b) the period of 3 months before or 2 years after the time for the exercise or performance of any power or obligation under, or the occurrence of any activity contemplated by, the contract, and (c) the period of the pendency of maintainable proceedings arising out of or in relation to the contract, being proceedings (including cross-claims, whether in the nature of set-off, cross-action or otherwise) that are pending against the party seeking relief under this Act. (Emphasis added.)
4. Counsel for Mr Magann submitted, with reference to the Court of Appeal's decision in Baltic Shipping Co v Merchant (1994) 36 NSWLR 361, that Mr Magann's claim was not statute-barred. It was ultimately conceded in oral argument that the decision in Baltic is binding in this case and that time started to run from the date that the Deed was pleaded as a defence to the 2017 proceedings.
5. Mr Magann seeks relief under s 7(1) of the Contracts Review Act which relevantly provides: (1) Where the Court finds a contract or a provision of a contract to have been unjust in the circumstances relating to the contract at the time it was made, the Court may, if it considers it just to do so, and for the purpose of avoiding as far as practicable an unjust consequence or result, do any one or more of the following: (a) it may decide to refuse to enforce any or all of the provisions of the contract, (b) it may make an order declaring the contract void, in whole or in part, (c) it may make an order varying, in whole or in part, any provision of the contract, (d) …

Unconscionable Conduct

1. Mr Magann's claim under the Contracts Review Act having failed, I turn finally to consider whether there is any scope for him to have the Deed set aside on the basis of unconscionable conduct on the part of the Church. There is a significant overlap as between this claim and that under the Act. In Thorne v Kennedy (2017) 263 CLR 85; [2017] HCA 49 the High Court confirmed the relevant principles of unconscionable conduct in equity to be as follows at [38] (footnotes omitted): "A conclusion of unconscionable conduct requires the innocent party to be subject to a special disadvantage "which seriously affects the ability of the innocent party to make a judgment as to [the innocent party's] own best interests". The other party must also unconscientiously take advantage of that special disadvantage. This has been variously described as requiring "victimisation", "unconscientious conduct", or "exploitation". Before there can be a finding of unconscientious taking of advantage, it is also generally necessary that the other party knew or ought to have known of the existence and effect of the special disadvantage."
2. Applying these principles to the facts as I have found them, Mr Magann has not established that he suffered from any special disadvantage let alone that the Church took advantage of it. No predatory state of mind on the part of the Church has been established.

Conclusion

1. At the time Mr Magann signed the Deed with his solicitor on 16 October 2007 he accepted payment from the Church in exchange for relinquishing a statute-barred claim. Neither he nor his solicitor, understandably, contemplated that in nine years time the obstacle to him asserting his legal rights in Court would be removed by Parliament. By releasing and discharging the possibility of renewing his claim for damages for sexual abuse prior to the passage of the Amendment Act, Mr Magann is now unable to have his "day in court", something he clearly yearns for.
2. The difficulty for Mr Magann is that his Deed was agreed to on the express basis that it would prevail in respect of all future claims arising from his allegation of child sexual abuse, including those that are now unlimited by time. Those were the terms on which the bargain was made, those were the terms that existed at the time and those are the terms to which regard must now be had.

Appropriate Orders

1. I propose to make the declaration sought by the Church. The effect of this is that the deed is valid and the Church's liability is extinguished.
2. In the defendant's written submissions an order for summary dismissal is sought in the event that the separate question is determined in its favour. Mr Boyd made no submissions on this issue. Although no notice of motion is before me seeking such an order I do not consider it to be consistent with the "just, cheap and quick" disposal of the matter to require that formality. Despite the fact that there was no express opposition to summary dismissal being entered, I propose to afford the plaintiff 14 days to approach the court should he wish to be heard as to why summary dismissal should not be entered.

ORDERS

1. Accordingly, I make the following declaration: 1. Declare that Deed of Release dated 16 October 2007 between the plaintiff and the defendant is valid and extinguishes the defendant's liability in relation to any cause of action arising from the matters contained in it including these proceedings. And I make the following orders: 1. Direct the plaintiff to file and serve within 14 days any submissions as to why it would be inappropriate for the Court to dismiss his claim. 2. Direct that the defendant file and serve any submissions in reply, if required, within 7 days after receipt of any submissions from the plaintiff. 3. Reserve judgment as to whether the court should dismiss the proceedings and direct that such determination take place on the papers. 4. The plaintiff is to pay the defendant's costs. 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: 29 October 2019