If you think bypassing Australia’s corrupt and cronyistic court system via mediation is a way to avoid expense and heart-ache, Ken Flower’s horror story may make you think again.The first in a heart-breaking three part series.
[Editor's note: The details in this three part story are all supported by a signed and witnessed statutory declaration, provided to IA.]
In a mediate danger
My name is Ken Flower. I was involved in a mediation that I thought would be straight forward. When it was over I wanted to put it all behind me and just ‘get on with my life’.
However, the mediation turned out so badly that my entire life has been affected. I was concerned with the conduct of the mediator Dr Longstaff and the other parties at the mediation. When I sought to ask questions through the proper channels, the position only got worse.
I continued over a long period to seek an open review of my concerns through various bodies with an interest or oversight role in the mediation area. However my impression is that I am facing a club with a wall of silence. None are willing to deal with my concerns.
Yet, if my concerns were completely misplaced, a speedy open enquiry would quickly reveal that to be the case.
This is my story.
I’m an ordinary person: married, 2 adult kids, always tried to live my life with the best values of what’s right and what’s wrong. I have an engineering background and have worked most of my life as an independent designer — video, staging and lighting. As an independent operator, I don’t seek out trouble with anyone and like to keep my head down. I have always believed in the power of reason to sort out any issues.
My record is an unblemished one in terms of being fair and honest — and I have the testimonials to prove it.
Everything had been going well…
I’d worked with a company called Australian Business Theatre (ABT) for 5 or 6 years as a freelance creative & designer. They specialise in corporate communication, including the staging and production of AGM’s, and product launches for big corporations — that sort of thing. I had a 100 per cent track record for beautiful creative work — on time on budget and everyone always happy. ABT were one of the largest producers in the country and are now amalgamated with Precinct Enero Photon, one of the largest producers globally.
The managing director of ABT, Peter Grose, had asked me one time to independently pitch for some projects to one of his long time clients — Mark Prechelt of RJ Reynolds in Hong Kong. ABT couldn’t do the projects for client conflict reasons, but wanted to keep the seat warm with Mark.
I did the creative, did the pitch, won the work and did the work. The projects were in HK, Tokyo and Kuala Lumpur, and were all a fantastic success. I kept Peter Grose in the loop, as it was his personal contact — and even offered him some of the technical production elements if he wanted them, which he did.
To my horror, I later found out ABT Precinct had secretly entered the whole project as a ‘conference module’ into peak Award Festivals locally and in the USA. The project had been entered as all their own work and had won Silver Awards for 3 consecutive years.
I knew nothing about any of this at the time.
When I finally got hold of some entry forms, I saw they had signed off the key part, the ‘copyright scripts’ as created by an ABT Precinct employee Peter Fulcher Meredith — when in fact I had personally created and written them myself. The entry forms also showed my other roles in the project all assigned to ABT Precinct employees.
The awards, with ABT Precinct Board Member Peter “Art” Lewry named on them as Creative Director, adorned the reception of ABT Precint Bond St, Melbourne, HQ for many years.
Worse still, I became aware Peter Grose and other ABT Precinct Board Members and staff had been calling up industry publishers and suppliers alike to smear my hard won reputation by portraying me as a plagiarist and waving the awards to back it up. A plagiarist of my own work, would you believe.
This went on for years — and they just would not stop, despite all pleas from me for reason. It was very upsetting, as they had been friends and colleagues for a long time and knew my wife knew my kids. It was just awful and very damaging to me professionally.
Even worse, a colleague brought to my attention that ABT Precinct had been on-selling the work as a ‘generic production module’ to other producers around the traps; assigning to others, for profit, my copyrighted intellectual property — which they didn’t own.
If the ABT Precinct mob would have been satisfied with just nicking the awards for my work, I would have left it — they being the big boys in the schoolyard. But the continual trashing of my professional reputation industry-wide very effectively prevented me from getting further work. It became so bad, eventually I had no choice but to front up my detractors with the truth.
And so it ended up a legal thing in the Federal Court and, eventually, into mediation.
We all agreed that Dr Simon Longstaff, Executive Director of St James Ethics Centre and Chair of the Mediation Accreditation Board of ACDC (one of the peak mediation bodies), was best placed to be the mediator. His other position as Chair of the Ethics Committee of the AFA (Australian Federation of Advertising) gave him a unique knowledge of our industry and this sort of dispute.
Mediating the Award Swindle
It was a pretty cut and dried case. I had my original handwritten scripts and an expert opinion (of the Award Swindle) from the US Festival judge.
There was the proof of on-selling my intellectual property and then, of course, the damaging smears Peter Grose made to an industry publisher. Within a few hours, Peter Grose – the Managing Director of ABT – rolled over and put a full mea culpa on the table etc.
Well, that should have been the end of it.
Dr Longstaff quickly suggested the basis for a mediated settlement. We all agreed:
- Peter Grose and ABT Precinct offer proper apologies and start putting out the reputational fires they had started.
- We show to the industry a united front and show we were working together on this.
- I withdraw my court case and prevent any further embarrassment to ABT Precinct and Peter Grose.
- Costs and financials to be made transparent for review by the other side.
However, the mediation then went on for a tortuous three more days, spread out over more than three months. During this period, ABT Precinct and their legal team embarked on a series of strategies that brought the whole mediation conduct into question.
According to the experts at IAMA (Institute of Arbitrators and Mediators Australia) it was the worst mediation they’d ever heard of and one that
“…raised a number of serious questions concerning the professional conduct of both the mediator and the attendant solicitors.”
There were several standout issues:
- Commercial offers in the mediation
- Failure to qualify costs
- Threats to call the Police
- Breach of Confidence
- Breach of contract.
These issues become the background to my story; a world of secret enquiries, secret submissions, cover-ups and the court case that followed.
I can discuss the mediation issues openly, as they relate to the conduct of the mediation — not the confidential content of the mediation.
Firstly, the mediator Dr Longstaff reported to my partner Susan that Peter Grose made a commercial offer to him — in the mediation. Worse still, he said he was considering the offer. (My partner Susan was the registered Mediation Observer on the Mediation Contract — a proper witness to the proceedings)
The offer was for ABT Precinct to redesign the St James Ethics Centre Logo. ABT Precinct specialise in and are well known as one of the best in the field in this area of work — corporate image design and rebranding.
According to the 12th St James Ethics Centre Annual Report (2001-2002) the SJEC logo was then redesigned and formally relaunched at the next SJEC AGM.
The SJEC Annual Report was also redesigned and relaunched at the AGM, as was the SJEC website.
In a later secret inquiry to a retired judge Dr Longstaff not only denied ABT Precinct had made any offer, but also, and more importantly, denied the SJEC Logo had been redesigned – even denying SJEC had even been considering it.
It is difficult to comprehend why would he say that, especially given it is blatantly contradicted by the 12th St James Ethics Centre Annual report — his own words, so to speak. And, of course, it is on the internet and on the public record at the State Library of NSW.
[Click here for excerpt of SJEC 12th Annual Report] **
Next, ABT Precinct failed to provide the financial records from the third party sales of the project, as they were obliged to do. I discovered later how important these were for ‘particularisation’ of damages and costs in my, or any, civil case.
Neither my solicitor – Katrina Rathie, partner at KWM Mallesons – nor Dr Longstaff, the mediator, ensured ABT Precinct provide these financial records — and the withholding of them had a significant effect later in the mediation.
The next big thing: was when my solicitor reported that the ABT Precinct legal team had just made threats to call the police into the mediation.
No proper cause or reason was given by Ms Rathie for this extraordinary statement, except something about searching our files for confidential documents — whatever that means.
Katrina Rathie reported this threat to my partner Susan (the official observer) at the end of the third day of mediation, just before Christmas. Incredibly, she gave instructions to Susan not to tell me.
The mediation had just broken down over particularising costs and damages and Dr Longstaff had already left the mediation (for a 3 month overseas trip) without resolving this issue.
After the Christmas break, I documented the threat on the Mallesons Mediation Agenda. Katrina Rathie retained a copy for the Mallesons file and I kept a dated record on my hard drive.
However, in later secret correspondence to a retired judge, Katrina Rathie denied that this threat ever happened. However, it’s recorded on the dated Mallesons Mediation Agenda file, and I still have the original dated file.
The mediation was adjourned for 3 months while Dr Longstaff travelled abroad.
But worse was still to come when the mediation resumed. In very quick succession, three occurrences threw the mediation into chaos:
- Confidential discussions I’d had with Dr Longstaff were leaked to the other side.
- My solicitor withdrew from my case, by phone, in a fit of rage.
- The Mediation Contract was compromised
Here’s what happened; a train wreck:
In a confidential solicitor/client meeting just before proceedings resumed, I discussed the full mediation agenda with Katrina Rathie — including the police threats issue. She confirmed it had happened and then forbade me to ever bring it up again. She was very explicit about this — and she was my solicitor.
She’d already decided she wouldn’t attend the mediation that day, so she retained a copy of the agenda and took it back to her office in Phillip St.
Soon after, in formal proceedings and with Dr Longstaff present, Peter Grose made a number of offensive and insulting accusations: blackmail and extortion — that sort of thing. It was very heated and intimidating.
So, I asked to speak to Dr Longstaff in a confidential break out meeting. I discussed the threats and bullying that had happened while he was overseas – including the Police Threats.
No-one else was present at that meeting with Dr Longstaff and the room was private from the mediation.
Dr Longstaff appeared shocked about the threats and intimidation that had occurred in his absence and left the room. I asked my partner (observer) to join me in the breakout room so I could bring her up to date with developments.
Within about 10 minutes, I had a call on my mobile from my solicitor Ms Rathie. It was made from her direct line at her Mallesons office (billing record available).
She was in an absolute fury. She told me that she’d just had a call from the opposing ABT Precinct barrister — that he’d told her I’d just discussed the police threats in the mediation, that she had instructed me not to do so, that she couldn’t trust me and would no longer represent me.
I tried to protest, but she slammed the phone down. Such was her anger.
My clear understanding was that she had resigned on the spot.
Dr Longstaff called her back, at her office, to ask her to reconsider her position. The call was made on my mobile in my presence and in my partner’s presence (billing record available).
After that phone call, Dr Longstaff pointed out to me the case was back in the Federal Court in a few days. He then put the onus on me as to whether or not the mediation should continue in those extraordinary circumstances.
In that fog of war, it was a decision I was not able to make — nor do I believe I should have been asked to make it.
From that point on, I was never quite sure whether or not I had proper legal representation. Certainly, Ms Rathie did not attend the rest of the mediation and she offered no further legal advice to me.
She did return when the mediation was all over to draft the agreements with the opposing barrister. And then she left prematurely, without bothering to make sure the settlement terms were properly signed off.
Dr Longstaff has never offered an explanation as to how the content of my confidential meeting with him about the police threats became known to everyone else in the mediation. I’d stayed in the private room — only he had left.
I found out later that breach of confidentiality by a mediator is the cardinal sin of mediation.
These were unforgettable and traumatic events for all concerned.
However, in later secret correspondence to a retired Federal Court Judge both Dr Longstaff and Katrina Rathie denied that any of this ever happened.
Why would they say that when the evidence leaves no other explanation?
The ramifications from these events that occurred in a matter before the Federal Court continue to this day. With cover up after cover up, the stakes continue to rise. It’s unbelievable to me that these professional people would allow it to fester to the point where their own reputations are put at risk, rather than simply fix it. But it was a grubby campaign from the beginning.
After such a bruising experience, a normal person would probably think “look — it’s time to put all this behind you and move on with your life”. And, indeed, that is exactly what I did.
As a small business operator and notwithstanding that something in the mediation was profoundly wrong, I had no desire to now take on Big Law, Big Ethics as well as Big Spin.
A sort of Hydra moment beckoned – and I ran for my life.
(Ken Flower picks up what happened next tomorrow in Part 2.)
** A Note of Clarification from Ken Flower (13 May 2013):
At the risk of deflecting from this narrative, I feel compelled to offer an update and explanation about the SJEC logo in view of recent developments last week.
My point about the logo does not hinge on whether it was or was not redesigned and by whom. My point is that a commercial offer to redesign the logo was said by Dr Longstaff (to my partner Susan) to have been made to him by ABT during the mediation. Subsequently the SJEC annual report clearly stated the logo had been redesigned at that time – but that this was subsequently denied by Dr Longstaff first in submissions to Hon Morling QC during an inquiry and then in evidence to the Supreme Court
Two recent pieces of correspondence go into inconsistent claims about this.
One is from a Ms Simone Walsh whom I do not know and with whom I have no issue. She claims to have been an employee of SJEC and to have been solely responsible for the design and layout of the SJEC 12th Report and I have no wish to dispute that. She also claims to have been responsible for the logo that was used that year and I again have no wish to dispute that as I cannot know what she did. She asserts moral rights and has demanded the publisher of IA “rectify” the position.
I hereby acknowledge her claims to moral rights of authorship. I simply note that her name has never appeared on any publication of the logo by SJEC or anyone else, so far as I am aware, and no intention existed or exists to deny her claim. I could not find any reference to this “work” on her website and do exercise caution.
Apart from clarifying this, another unusual piece of correspondence has arrived. In a remarkable coincidence, I have just received a lengthy note from Dr Longstaff relating directly to this issue. I welcome any correspondence from him but have had none for years. He has requested that I acknowledge the work done by Ms Walsh (which I have immediately done above) as a matter of fairness from me, as one designer, to Ms Walsh, as another. Having complied, I can only hope that this provides some basis for moving forward.
However, despite Dr Longstaff’s attempt to support Ms Walsh, he asserts that the logo was not redesigned. This issue is of no consequence to my story, but I am somewhat staggered by the competing claims that are being made.
On the one hand Dr Longstaff, as Executive Director of SJEC, formally signed off at least 7 years of Annual SJEC Reports stating the logo was redesigned. On the other hand he now states that the logo was not redesigned. And at exactly the same time his previous employee claims her moral rights that it was.
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