Steve Hutchins (NSW, Australian Labor Party) Share this | Link to this | Hansard source

I call Senator Bishop.

Mark Bishop (WA, Australian Labor Party) Share this | Link to this | Hansard source

I cede the call to Senator Abetz.

Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I thank the Senate and in particular Senator Bishop for allowing the normal formalities with bills to proceed. On this occasion I am standing in for our very excellent and very learned shadow Attorney-General, the Hon. George Brandis SC. The Access to Justice (Civil Litigation Reforms) Amendment Bill 2009 is principally directed to the case management processes in the Federal Court of Australia, although there are some relatively minor amendments also directed to the Family Court and the Federal Magistrates Court. Case management is the practice whereby judges control the progress of a case through the preliminary stages prior to trial to ensure that the parties keep to an appropriate timetable so that the issues in the dispute are narrowed and that unnecessary costs and delays are avoided.

The bill introduces an overarching purpose to case management, which is to facilitate the just resolution of disputes according to law as quickly, inexpensively and efficiently as possible. This is further defined inter alia to require the resolution of disputes at a cost that is proportionate to the importance and complexity of the matters in dispute. Parties to a dispute must conduct the litigation in a way consistent with the overarching purpose, and legal practitioners will be obliged to assist their clients to comply with that duty. Costs orders will be used to compel compliance and they will also be available against lawyers personally. Other sanctions may include orders for the dismissal of proceedings or limitation of the case a party may wish to present. In addition, there are amendments to curtail appeal rights in respect of interlocutory orders to refer any matter for alternative dispute resolution and to charge the heads of each federal court with a responsibility for the effective discharge of the business of the court.

At the time this bill was first introduced there was a particular concern that it did not sufficiently recognise the tension that can exist between the concepts of efficient case management and the interests of justice. This issue was highlighted by the High Court in the case Queensland v JL Holdings Pty Ltd 1997. However, the court revisited the issue in Aon Risk Services Australia Ltd v Australian National University on 5 August 2009. The decision recognises that the function of case management is the delivery of justice and provides guidance to lower courts to prevent their processes being distorted, thus frustrating the proper functions of the courts. This bill sits happily with that clarification.

The bill proposes that certain alternative dispute resolution processes be used in federal civil proceedings as a means by which disputes may be resolved more cost effectively and efficiently. Alternative dispute resolution is a general turn referring to processes other than litigation used to assist people to resolve various disputes. It is important to note that there are different types of such processes, and particular types of alternative dispute resolution processes suit particular types of disputes. This bill was referred to the Senate Legal and Constitutional Affairs Committee for inquiry and it reported on 17 September. The only substantive submission received was that from the Law Council of Australia. The Law Council generally welcomed the reforms which are the subject of the bill. In its submission the Law Council stated:

The concept of ‘mega-litigation’ has in recent times drawn attention to the impact that private disputes can have on the courts and the strain that such litigation can impose on the scarce public resources required to fund the court system.

The costs of lengthy and inefficient litigation are carried not only by the parties themselves but also by taxpayers, who fund the operation of the justice system. Judicial salaries, court officer and registry staff salaries and court premises costs are incurred unnecessarily by litigation that is not efficient or cost effective. If inefficient litigation monopolises court resources then those that cannot afford protracted litigation are prevented from accessing the justice system.

Subject to one amendment, which will be moved in the committee stage, the coalition supports this bill. The amendment to which I refer is a matter on which Senator Bob Brown and I have been campaigning quite vociferously in Tasmania, and that is for a full-time registrar of the Federal Court to be positioned in Hobart. The Senate has carried motions to that effect. I personally have pursued the matter at Senate estimates on the last two occasions and of course Senator Bob Brown has himself pursued the matter as well. In discussions with the government it seems that the best way forward is to have an amendment, which I understand has now been circulated on sheet 5937, revision 2. I commend that amendment to the Senate.

I conclude my comments in relation to the amendment by saying that it is vitally important that the Federal Court has an appropriate jurisdiction in every single one of the founding states of the Commonwealth. Tasmania is one of those founding states. It is called the Federal Court and one would imagine that, in the basics of the Federal Court administration, there would be equity between the States and they would all have a full-time registrar. The move undertaken by the Federal Court is at best—at very best—about saving $200,000, but we still have not got to the bottom of that because at Senate estimates we were promised that there was no surplus of staff at the Melbourne registry, but all the work in Hobart could be undertaken by the Melbourne registry, although when the Hobart registrar had to fly to Melbourne to help them with their workload it was not because there was a surplus of work in Melbourne registry.

I invite people to read the Hansard and then go figure because quite frankly the explanations provided defied the pub test, defied logic, defied common sense. It seems as though it had more to do with empire building within the registry systems rather than the good management of judicial processes. We were also promised that with less the Hobart registry figures would be even better than they are now. If that is the way to administer court registries one wonders why all the court registries do not slash staff and as a result improve their outputs. I must say, politely, the logic sought to be provided to us by representatives of the Federal Court administration lacked substance.

As a result we in the coalition believe it is justified to move the amendment that Senator Bob Brown will be moving to ensure that the Hobart court registry is reinstated to its proper place and position. It also seems that there is a bizarre demarcation dispute between the Administrative Appeals Tribunal and the Federal Court registry because we were told that the Hobart registrar, when he was full-time, did quite a bit of work for the Administrative Appeals Tribunal. However, the Administrative Appeals Tribunal did not want to make a contribution to the salary of the Federal Court registrar in Hobart and so now the Administrative Appeals Tribunal, also run by the government and so also run by the Australian taxpayer, will have to find somebody else to do the Administrative Appeal Tribunal work. Whilst the Federal Court potentially might save some money it is quite clear that another arm of government will have to spend more money on servicing the Administrative Appeals Tribunal aspect in Hobart and as a result the so-called savings in globo will be substantially diminished.

I have indicated to the Federal Court that in future Senate estimates I will be inquiring into the actual alleged savings, but if this amendment is carried one hopes that everything will be reinstated, as it should be, and as a result we will not need to pursue those questions at future estimates. In brief, the coalition commends to the Senate both the bill and the amendment co-sponsored by Senator Bob Brown and me.

Mark Bishop (WA, Australian Labor Party) Share this | Link to this | Hansard source

I am pleased to be able to support the Access to Justice (Civil Litigation Reforms) Amendment Bill 2009 before the chair today. It represents much needed reform in an area of traditional resistance to change. I am reminded of the wonderful story Bleak House by Charles Dickens. The story concerns a family dispute in chancery over a fabulously wealthy estate. The fate and fortune of so many characters is dependent upon a settlement which seems to drag on year in, year out—in fact, interminably. The only hearings in chancery were to consider applications for costs from a horde of parasitic lawyers; it was never, ever about the merits of the particular case. Eventually, as always happens, the case was brought to a close simply because the entire estate had been consumed by costs. Those who depended so much on an outcome received nothing; the lawyers, the lot. That is simply a bit of romantic background but with, of course, serious overtones. It reminds us of the real evils of a legal system which is not too many years behind us.

The bill before us today seeks to introduce a number of reforms. The first brace of these is aimed at introducing some discipline into the system, a system which for too long has simply responded to demand without proper consideration of need and good sense. The second is about improving the efficiency of the Federal Court. It is a foundation stone of our constitutional democracy that we have a system of law and a judicial system capable of dispensing justice fairly and efficiently. That has been the ambition anyway. Of course, it has not always been achieved. Too often, the system has been slow and litigious, with too much time spent on process and not enough on adjudication on the merits of the particular matter in dispute. The courts themselves are responsible for some of that, but governments more so. For too long we have been cowed by fine notions of due process. The legal profession too has much to account for due to its behaviour and self-interest.

As we all know, so much legal activity is locked up in process. It is the old standby for lawyers, who know full well that the other side can be exhausted before merits even get questioned or considered. For too long it has been a ploy as part of the battle. It is the very worst of legal behaviour, which in fact denies justice and makes a mockery of the law and proper legal process. One recent case of notoriety reminding us of this continuing failure was The Bell Group Ltd v Westpac Banking Corporation in 2007. Here, two well-fed commercial giants slugged it out in what has become known as the C7 case. Justice Sackville made particular comment on the excessive costs, which I understand to have been unbelievably in the order of $200 million. The costs were totally disproportionate to the issue at stake. Again in 2007, we saw the case of Seven Network Ltd v News Ltd. Once again, two media giants argued themselves to a standstill for no real purpose except commercial pride. Both cases were obviously a complete waste of public resources.

It seems that once the legal profession joins battle there is no backing down. It is interesting to note that in the examination of this bill in the Senate Legal and Constitutional Affairs Legislation Committee the task of the legal profession was a matter of some considerable focus. For example, in the proposal to make lawyers responsible for the management of their case, it defeats the demands of the client, as the client has the right to continue his or her litigation at all cost. ‘At all cost’ is the appropriate phrase. Those opposite in their addendum to the committee report support that proposition, as does the Law Council of Australia. I am afraid this government is drawing a line, and it is appropriate that a line be drawn. It is simply not feasible any longer that public funding continue to flow to public functions and institutions simply because of raw demand. Take our health system, for example: we have long realised that there are better and more efficient ways of delivering health care than through large, expensive hospitals; and so it is with the court system. People need health care and they need a form of dispute resolution, but they do not always need hospitals or courts. That is not to say that access is being denied but simply that no system is or can be open-ended. It is indeed a democratic right to have a fair and equitable system of justice available to all, but it has never been unlimited and it never can be unlimited.

The cases I referred to can only be considered abuse of the democratic system of public justice. That is not to say that justice is being denied unnecessarily—quite the contrary. In fact, it could be said that these days it is more available than it has ever been, particularly through the tribunal system and through the growing use of dispute mediation. Access to some form of justice is now more available than it ever was in the past. New courts have also been provided, and the courts are well aware that demand has to be limited somehow. Thus, reforms have been made in the last decade or so, but clearly much more needs to be done.

Despite the complaints, justice is more accessible these days. But, equally, we must ensure that demand is not open-ended as this allows petty litigious behaviour to keep driving the supply side without limit. Lawyers have a responsibility here. This bill now provides that there will be penalties for them where they fail to control or properly advise litigious clients. Proposed section 43 makes specific provision for lawyers to bear costs personally. One hopes that that might make some of them think twice. The proposed section also gives the Federal Court other discretionary powers with the same end. The court may make awards for costs at any stage in a proceeding, make different awards in relation to different parts of a proceeding and make orders specifying proportions. Just as important, however, the court will be given new powers to deal with minor matters. There is some hope that this will sort out the litigious, for whom court action for too long has been a tool of the trade.

Through this bill, the court is being given new powers, including consideration without oral hearing. With or without the consent of the parties, the court will be able to dismiss frivolous and vexatious cases, those where there appears to be solid precedent rendering a case unnecessary and those where the case is adequately expressed on the written submissions. These measures are very practical indeed—so much so that one can only wonder why it has taken so long to arrive at this point. Perhaps it just goes to show how resistant the legal profession is to change. The overarching principles that drive this reform bill also make it clear that behaviour must change. Obviously, law such as this cannot be prescriptive. Hence we have in this bill a requirement that legal behaviour must be consistent with the overarching purposes of the bill—that is, a set of principles which can be applied with the court’s discretion. For example, the court’s resources must be used efficiently, cases must be determined in a timely manner and costs must be in proportion to the complexity of the matter before the court.

In applying these principles, the court, in exercising its discretions on costs, may take certain behaviours into account—for example, unreasonable refusal to participate in mediation and conciliation; failing to act in good faith in achieving resolution; unreasonably rejecting offers of settlement; and otherwise being vexatious and frivolous. By this means the court may dismiss cases outright, strike out claims, disallow evidence and award costs accordingly. In this context, I must also make mention of the new emphasis placed on mediation and conciliation. It is regrettable that the use of these means of reaching settlement in disputes is not used as actively as it should be. The National Alternative Dispute Resolution Advisory Council, whose advice was sought by the Attorney-General, responded with a recommendation that alternate dispute resolution be mandated in law. That is exactly what the Attorney has done in this bill. It is a very salutary innovation. Reference to the council’s work is recommended because it is clear that it is not as simple as it might appear. For example, it is easier to apply in civil circumstances than it is where there is a public defendant. Discretion might be limited by law, not just government policy. Nevertheless, it is important wherever possible that government agencies also adopt the principles of ADR to the maximum extent possible. Indeed the history of Defence Legal in the last five to eight years, in its way of litigating and exhausting opponents through extensive use of the courts, is a reminder to us that it would be quite appropriate for a bill sometime in the future to mandate these principles for large government departments or agencies.

Finally, let me turn briefly to the second brace of changes proposed in the bill. These relate principally to the jurisdiction of the Federal Court and the management of appeals. Put simply, these changes streamline the way appeals are managed. From judgments of single judges, and the relationship between those appeals and the engagement up to and involving the full court, these changes also alter the means by which some matters might proceed on to the High Court, freed of some of the current wasteful process and delay experienced. These changes also include the streamlining of the way interlocutory matters are considered. These seem to me to be sensible procedural changes which should simplify the way the court works, to the greater benefit of both the court and those who use it on a regular basis.

I commend this bill, and I also commend the consideration given to it by the Senate Legal and Constitutional Affairs Legislation Committee. During that process it is clear that many interested parties made valuable contributions and in large part supported the provisions before us today. Clearly, when you look at the submissions, there were some exceptions. However, in my view, those criticisms do not change the major impact that the bill should have and seeks to have. Quite clearly the consultative process has been quite thorough, and it is pleasing to see the industry, and many people who made submissions, respond so effectively. In that light, I support the bill.

Penny Wong (SA, Australian Labor Party, Minister for Climate Change and Water) Share this | Link to this | Hansard source

I table an addendum to the explanatory memorandum relating to the Access to Justice (Civil Litigation Reforms) Amendment Bill 2009. Can I thank all senators who have contributed to this debate and can I also, consistent with some of the contributions, thank the Senate Legal and Constitutional Affairs Legislation Committee, who delivered their report on this bill in September. Their inquiry was conducted in a short time frame and the government is aware that at the same time the committee was considering a number of other bills and conducting major inquiries into access to justice in Australia’s judicial system and the role of judges.

The committee found that there is widespread support for the reforms contained in the bill. There were two specific recommendations made. The first was to clarify the scope and operation of proposed section 37N(1), which requires parties to act consistently with the new overarching purpose. I am advised that the government has clarified this by circulating the addendum to the explanatory memorandum. The second recommendation was to make sure that security for cost orders can still be appealed. The government has responded to this recommendation by moving a government amendment to the bill. In addition to responding to the committee’s recommendations, the government has made a further amendment to encourage judicial transfers. As some senators have recalled, the government expects numerous benefits from Commonwealth participation in a one-way transfer of a Federal Court judge to state supreme courts. These include enhanced knowledge and experience of judicial officers, retention of experienced officers for longer periods and a more consistent body of national decision making in areas of common jurisdiction. This amendment also sends a clear message that the Rudd government intends to be proactive in working with the states to pursue national court excellence. Both Senators Abetz and Brown referred to the issue of the Federal Court registry in Hobart. I can indicate that the government will support the new amendments moved by Senator Brown in the committee stage and I will make some further comments at that point.

These case management provisions are timely. High Court Chief Justice French has observed that in the Federal Court the intensity of judicial case management has been increasing, and the High Court’s recent decision on case management in the AON case will reinforce the case management reforms being introduced by this bill to effect a cultural change in the way litigation is conducted in the Federal Court, a change that leads to improved access to justice. I commend the bill to the Senate.

Question agreed to.

Bill read a second time.