Joe Ludwig (Queensland, Australian Labor Party, Manager of Opposition Business in the Senate) Share this | Link to this | Hansard source

I move the opposition amendment on sheet 4820:

(1)    Schedule 1, item 1, page 3 (line 7), before “Part IVA”, insert “section 46 or 46A of Division 8, Part IV,”.

This amendment seeks to extend the jurisdiction of the Federal Magistrates Court to include matters arising under sections 46 and 46A of the Trade Practices Act. This would fully implement the recommendations of the Senate Economics References Committee, and it would help small business to access remedies for the misuse of market power by providing a cheaper and less complex forum. In its response to the economics committee’s report, the government said it disagreed with this recommendation on the ground that these matters were too complex for the Federal Magistrates Court. I am not sure who it was insulting in that respect.

We can see where the government is coming from on this matter. Misuse of market power cases certainly can be complex and time consuming; there is no argument about that. But we are confident that the law is sufficiently flexible to ensure that complex cases can be dealt with in the Federal Court and simpler cases can be dealt with in the Federal Magistrates Court.

Section 39 of the Federal Magistrates Act provides a mechanism for the Federal Magistrates Court to transfer any matter to the Federal Court, including where the resources of the Federal Magistrates Court are not sufficient to hear and determine the proceedings. Any complex matters beyond the capacity of the Federal Magistrates Court could easily be transferred to the Federal Court, either on application of the respondent or on the initiative of the magistrate. This would be, and is, a sufficient safeguard.

In fact, my recollection is that this matter was raised right back when the Federal Magistrates Court was first established, in order to ensure the ability on the part of the Federal Magistrates Court to deal with simpler matters and the Federal Court to deal with more complex and time-consuming matters. That was a reasonable split between the particular courts. That was an issue that we ventilated at the time the Federal Magistrates Act was introduced—that we wanted to ensure that there was that flexibility and the ability to transfer those matters.

It should also be recognised that it is possible to have relatively simple misuse of market power litigation. It would be wrong for the government to suggest that all misuse of market power litigation is complex and time consuming. There are, and would be, such circumstances, especially under section 83 of the Trade Practices Act. That provision allows for findings of contravention in one case to be used as prima facie evidence in a later case. In the context of misuse of market power cases, this might mean that complainants in later cases can rely on the findings made in earlier cases on the forensic economics and forensic accounting that tend to make these cases so long and complex. This is a rarely used provision, but opening up the option of utilising follow-up litigation in the Federal Magistrates Court might give it new life.

Of course, it was not put there for no purpose. As the Senate Economics References Committee found, small business would benefit from giving the Federal Magistrates Court jurisdiction to deal with misuse of market power cases. Given the ability of the federal judiciary to transfer complex and simple cases to their more suitable forum, we are not convinced that the complexity of much of this litigation is sufficient reason to deny small business this opportunity for improved access to justice.

It is disappointing that National Party senators are not here to contribute to this debate. I know they have an interest in small business and I know they have an interest in sections 46 and 46A. It makes me wonder why they are not arguing for this change. I know they would have taken a deep interest in the Senate Economics References Committee report. I know that many Liberal backbenchers have had an interest in this area. I am sure they would want to be able to support this amendment, which would ensure that, under sections 46 and 46A, the less complex cases can be dealt with in the Federal Magistrates Court. It would be a boon to small business. Small business would have the ability to take matters involving misuse of market power to the Federal Magistrates Court and, if they are advised that they are less complex and less time-consuming matters, may therefore be given access to a cheaper forum than the Federal Court. However, it is disappointing to note that those backbenchers have not made a contribution and that they are not concerned about the matter. They do not take the interests of small business seriously, as small business should be able to access less expensive and less time-consuming forums so that they can be assisted in dealing with these types of cases. I commend the amendment to the committee.

Chris Ellison (WA, Liberal Party, Minister for Justice and Customs) Share this | Link to this | Hansard source

I place on record these remarks as a basis for the government’s opposition to the amendment proposed by Senator Ludwig. Before I do so, I think it is important that I reject any notion suggested by Senator Ludwig that the government has in any way insulted federal magistrates by implying that these areas are too complex for federal magistrates to handle. The federal magistrates have done, and are doing, a fantastic job in the administration of justice in this country. I want to place on record the government’s appreciation and recognition of the work the federal magistrates are doing. This was, of course, recognised when former Chief Federal Magistrate Diana Bryant was elevated to Chief Justice of the Family Court of this country. I think that the work she did in relation to federal magistrates in this country was outstanding, and that good work has been continued by Chief Federal Magistrate Pascoe and other federal magistrates. Indeed, the Remuneration Tribunal has recognised the great work they do and the heavy workload they have by providing a loading of remuneration. So at the outset I want to make it abundantly clear that the Australian government acknowledges the very good work that is done in the Federal Magistrates Court in this country.

I turn to the amendment at hand—that is, that the Federal Magistrates Court should have jurisdiction in relation to cases relating to sections 46 and 46A of the Trade Practices Act. In the March 2004 report, The effectiveness of the Trade Practices Act 1974 in protecting small business, of the Senate Economics References Committee the opposition members of that committee recommended that the jurisdiction of the Federal Magistrates Court be extended to enable it to deal with cases involving sections 46 or 46A where section 83 of the Trade Practices Act is relied upon. Section 83 provides that a finding of fact by a court made in certain proceedings under the Trade Practices Act may be relied upon as prima facie evidence of that fact in other proceedings under the Trade Practices Act. The thinking there is that, by virtue of relying on facts previously found, it would make the matter simpler and less lengthy. But I stress that the committee report was by a majority of non-government members, because the coalition members did not support that.

In its response to the committee’s report, the government did not support the more limited proposals of giving jurisdiction in section 46 cases where section 83 is relied upon. The government considered then, as it does now, that section 46 and 46A cases, even those relying on section 83 of the Trade Practices Act, are likely to raise issues that are complex and more appropriately considered by the Federal Court. The Federal Magistrates Court was established to deal with less complex issues, as I stated earlier. That is perhaps conveniently described as cases that will take two days or less of hearings. That is, of course, designed to free up the resources of superior courts.

To give you some idea of the complexity of section 46 cases, first instance hearings in the major case of the Australian Competition and Consumer Commission and Boral Ltd ran for 23 days. In the NT Power Generation Pty Ltd and Power and Water Authority case, the hearings ran for 55 days. In the Australian Competition and Consumer Commission and Rural Press case, the hearings ran for 17 days. There are other examples. So what I would stress to the committee is that this amendment would confer jurisdiction on the Federal Magistrates Court for cases that are manifestly unsuitable for that court when you look at the rationale of why it was set up.

The government’s view is in no way in relation to the competency of the federal magistrates—far from it. I have already stressed that the government appreciates their great work and recognises the great contribution the Federal Magistrates Court makes to the administration of justice in this country. What I am saying is that we would have a system that would then be tied up with lengthy cases—a system that was designed to deal with those cases that can be dealt with more quickly. Of course, efficiency is an aim in the administration of justice in these times, when we find people are more litigious and matters are more complex—and a very important aim, at that. That is the reason for the government’s rejection of this amendment.

As for allowing small business access to a cheaper, simpler process in relation to section 46 of the Trade Practices Act, can I say that certainly small business would not welcome a system that became bogged down with lengthy cases. We have to put in place a system that is efficient and can provide those benefits and ensure that it remains. Small business would not benefit from a system which was hijacked, if you like, by cases with the sort of duration of those I mentioned, which is indeed lengthy. That is quite the opposite of what we are intending for the Federal Magistrates Court. For those reasons the government opposes the amendment, and I commend the bill as it stands to the committee.

Joe Ludwig (Queensland, Australian Labor Party, Manager of Opposition Business in the Senate) Share this | Link to this | Hansard source

I welcome the comments by the minister. Like the minister, the opposition also has a high regard for the Federal Magistrates Court and their work. However, I maintain my opposition to his arguments against the amendment. It is an appropriate amendment and it will ensure that small business and others will have access to the Federal Magistrates Court in less complex matters, which was the reasoning behind the establishment of the Federal Magistrates Court in the first place.

It is disappointing to find that the government is still hiding behind the belief that all these matters will be complex and time consuming. That seems to be the main argument: that every matter under sections 46 or 46A will be complex and time consuming and will bog down the court. I reject that and Labor rejects that. I am sure that the Federal Magistrates Court would be able to discern whether cases should be and are simple and can be dealt with in their jurisdiction, or whether they are more complex and can be referred.

Question put:

That the amendment (Senator Ludwig’s) be agreed to.