Policeman defamed

Barrister who ran Tyler Cassidy website ordered to pay $150,000

The Supreme Court of Victoria decision Dods v McDonald shows that aggravated damages will be awarded where defamatory implications are grave and maintained without any apology offered.

Facts

Tyler Cassidy was 15 years old when he was shot by police in a park in Melbourne.  Colin Dods, the plaintiff, was one of the Victoria Police Members who fired at Tyler.  The plaintiff was exonerated of personal responsibility and was found not to have contributed to Tyler's death in findings which followed a coronial inquiry conducted in 2011.

The defendant, a Queensland based barrister, was aware of the Coroner's Court findings when he published two statements about the plaintiff's involvement in Tyler's death on pages of his website (which was focussed on Tyler's death) in 2012.  The plaintiff alleged that the natural and ordinary meaning of these statements included that: the plaintiff had executed, shot and killed, gunned down, and chose to shoot Tyler; used excessive force out of proportion to the threat posed by Tyler; and committed manslaughter by shooting Tyler.

The defendant denied the plaintiff's repeated requests for an apology although he did modify the relevant pages of his website and ultimately closed the website down.  After amending his defence a number of times prior to trial, the defendant denied that the publications were defamatory, denied that the plaintiff was entitled to aggravated damages and sought to rely on the defence of triviality (ie that it was unlikely in the circumstances that the plaintiff sustained any harm).  The defendant maintained the defence of justification (ie truthfulness) until shortly before the trial.

Decision

A jury found that the publications were defamatory and the defence of triviality was not established.

His Honour Justice Bell ordered that the defendant pay the plaintiff $150,000 in damages, including aggravated damages.  His Honour found that certain aspects of the defendant's conduct of his defence had been improper and unjustified and, even though the scope of publication had not been large, the jury had found that the defamatory content had been grave.

Read more about compensation awarded to a woman who was the subject of sexually explicit Facebook posts here or about the tweet that led to former Treasurer Joe Hockey being awarded $200,000 here.

If you would like to know more about the law of defamation please contact:

Max Steed
Solicitor

Anna English and Dianna Gleeson
Managing Principal Solicitors

Tweets aren't cheap

This case illustrates the great care that must be taken when drafting short, sharp publications intended for dissemination on either social or traditional media platforms.

In Hockey v Fairfax Media Publications Pty Limited, handed down on 30 June 2015, Justice White of the Federal Court of Australia found that Fairfax Media had defamed Federal Treasurer Joe Hockey and awarded him $200,000 in damages. The judgment makes for interesting reading.

The case concerned articles, tweets and a poster published by the Sydney Morning Herald (SMH), The Age and The Canberra Times. The articles stated that Mr Hockey was providing 'privileged access' to a 'select group' in return for donations to the Liberal Party. The tweets and poster acted as sign-posts to the articles through use of the phrase 'Treasurer for Sale' and similar.

Mr Hockey sued the papers' corporate arm, Fairfax, for defamation in three proceedings, which were heard together.  He asserted that the publications contained defamatory imputations (e.g. accusations or meanings), including that he had acted corruptly (the relevant imputations).

Did the publications contain the relevant imputations?

Fairfax conceded that the relevant imputations would be defamatory, but denied that the articles, tweets and poster conveyed them. The contest between the parties turned on this point.

In determining whether the articles, tweets and poster conveyed the relevant imputations, Justice White adopted the customary 'reasonable person test' as his starting position. His Honour queried whether the 'ordinary, reasonable reader would have understood the matters complained of in the defamatory senses pleaded' and, in doing so, made several handy comments about the nature and disposition of our hypothetical friend (see paragraphs 63 - 73 for more on this).

Ultimately, his Honour concluded that the ordinary, reasonable person would not have understood the articles to have conveyed the relevant imputations about Mr Hockey, but would have understood two of the tweets and the poster to have done so.

The key distinction between the articles, tweets and posters, in his Honour's judgment was the context that the authors of the articles were able to provide in drafting them. His Honour found that individual passages of the articles, when read in isolation, could be understood as conveying a defamatory imputation.  When the articles were read as a whole, however, his Honour found that those passages were 'cured' - that the ordinary, reasonable reader, after reading the articles in full, would arrive at a more nuanced conclusion that did not defame Mr Hockey. 

The tweets and posters were a different story. Without the benefit of context, Justice White found that two of the tweets and the poster were undoubtedly defamatory. His Honour did not consider that the hyperlinks contained within the two relevant tweets provided sufficient context since, on the evidence, a substantial number of people viewed the tweets without clicking on them. The third tweet that contained an embedded version of the article was, however, deemed to contain sufficient context and, for that reason, was not regarded as defamatory.

Defence of qualified privilege did not apply

The statutory defence of qualified privilege, and the extended form of qualified privilege recognised in Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 were found not to apply because, in his Honour's view, the publications were not reasonable, and appeared to have been motivated by an improper motive that would prevent the defence from succeeding.

His Honour considered the application of the defences to each of the articles, tweets and posters. Mr Hockey conceded, as part of this consideration, that the subject matter of the articles, tweets and poster was a matter of public interest, and that imputations contained in the publications were conveyed in the course of providing the public with information on that subject. The application of qualified privilege therefore centred on the third element of the defence - whether, in all of the circumstances, Fairfax's conduct was reasonable.

His Honour considered a range of factors, some from statute and others from common law (see paragraphs 227 - 230 for more on this), as part of this enquiry. Ultimately, his Honour  concluded that Fairfax had not acted reasonably in publishing the articles, tweets or poster. 

The most relevant consideration in respect of the articles was the steps Fairfax had taken to obtain a response from Mr Hockey before publishing them - steps which, in his Honour's view, were inadequate. The most relevant consideration in respect of the tweets and poster was the availability of alternative, non-defamatory modes of expressing the same point -  that Fairfax could have used words like 'Hockey: donations and access. Herald investigation', or other non-defamatory phrases, without losing effect.

His Honour also considered whether, in the event qualified privilege were deemed to apply, it would be vitiated by the presence of an improper motive by  Fairfax. The issue of an improper motive arose from several emails and texts sent between Fairfax editors and journalists, which included an instruction that the story be 'nailed to a cross'.  His Honour concluded, on the basis of this exchange, that the articles, tweets and poster had been actuated by SMH editor-in-chief, Darren Goodsir's, personal animus towards Mr Hockey, and that qualified privilege would therefore have been defeated, if it had applied.

To refresh your memory on best practice for members of the VPS on social media see our previous blog When is it ok for a public servant to tweet political opinions?

If you would like advice about this case, or about defamation law and its application to you,  please  contact:

Will Yates 

Solicitor

Dianna Gleeson

Managing Principal Solicitor

Pranking doesn't pay: when can a licensing authority inquire into criminal conduct by a licensee?

In Australian Communications and Media Authority v Today FM (Sydney) Pty Ltd, a judgment handed down on 4 March 2015, the High Court considered the circumstances in which a regulator can investigate and make findings with respect to alleged criminal conduct by a licensee. The case arose out of a now infamous incident in which Australian commercial radio personalities Mel Greig and Mike Christian telephoned nurse Jacintha Saldanha claiming to be members of the British royal family and sought information regarding the health of the Duchess of Cambridge. The prank call was recorded and broadcast on Today FM's Hot 30 Countdown program on 5 December 2012. Ms Saldanha later committed suicide.

Action by the Australian Communications and Media Authority

ACMA investigated the conduct of Greig and Christian for the purpose of determining whether action should be taken with respect to Today FM's commercial radio broadcasting licence. In a preliminary investigation report, ACMA concluded that Greig and Christian had committed a breach of the Surveillance Devices Act 2007 (NSW). ACMA therefore determined that Today FM had breached a condition imposed upon its commercial radio broadcasting licence by the Broadcasting Services Act 1992 (Cth) (the Act) that it not use its broadcasting service 'in the commission of an offence against … a law of a State'.

Court Proceedings

Today FM sought a declaration in the Federal Court that the Act does not authorise ACMA to make a finding that a licensee has committed a criminal offence. It submitted that the Act only authorises ACMA to take notice of the fact that a licensee has been convicted of an offence by a court. In the alternative, Today FM submitted that the Act breaches the separation of powers mandated by the Commonwealth Constitution by investing ACMA with judicial power.

Today FM's application was dismissed by Edmonds J. An appeal to the Full Federal Court was allowed. ACMA appealed to the High Court.

Judgment of the High Court

French CJ, Hayne, Kiefel, Bell and Keane JJ stated that 'it is not offensive to principle that an administrative body is empowered to determine whether a person has engaged in conduct that constitutes a criminal offence as a step in the decision to take disciplinary or other action.' ACMA was required to determine, to the civil standard of proof, whether criminal conduct had occurred. However, this was to be done as a step in determining whether ACMA should take administrative action in response to a breach by Today FM of its licence conditions. ACMA was not required to determine criminal guilt as a step in the infliction of punishment. According to the majority, there was nothing 'incongruous' about conferring upon a licensing authority power to determine whether a broadcasting service had been used in the commission of a criminal offence.

The majority rejected Today FM's constitutional argument in peremptory fashion, stating that 'none of the features of the power conferred on the Authority to investigate and report on breach of the … licence condition and to take consequential administrative enforcement action support the conclusion that it is engaged in the exercise of judicial power.' Gageler J delivered separate concurring reasons.

What does this case mean for decision-makers?

Administrative decision-makers are often called upon to determine whether conduct amounting to the commission of a criminal offence has taken place. Thus, for example, a Tribunal exercising functions under the Health Practitioner Regulation National Law may be called upon to determine on the balance of probabilities whether a health practitioner has engaged in professional misconduct amounting to the crime of rape or indecent assault.

The Court's decision in Today FM is a reminder that the treatment of criminal offences in the context of administrative decision-making is a wholly different matter from the conduct of criminal proceedings. Administrative decision-makers are not bound by the rules of evidence and must take into account all information that is relevant to the performance of their statutory functions. They apply standards of satisfaction as to factual matters that are fundamentally different from the standard of proof applied by criminal courts. Thus an administrative decision-maker may properly conclude that an offence has been committed even where an acquittal has been entered in respect of the offence by a criminal court. In addition to confirming the scope of ACMA's jurisdiction under the Act, Today FM provides a valuable caution against implying principles of criminal law into administrative decision-making.

Of course, Today FM is a corporation and is not entitled to the privilege against self-incrimination. The issues considered by the High Court in Commissioner of the Australian Federal Police v Zhao were therefore not relevant to this matter. It should, however, be borne in mind that in an appropriate case, an injunction may issue to restrain an administrative decision-maker from acting in circumstances where the performance of its functions may undermine an accused's right to silence.

For queries relating to any of the issues identified in this blog, please contact:

Jonathan Bayly

Principal Solicitor

jonathan.bayly@vgso.vic.gov.au

Janine Hebiton
Managing Principal Solicitor

janine.hebiton@vgso.vic.gov.au

Should I stay or should I go (ahead)? Staying civil proceedings when they threaten a fair trial

In the recent case of Commissioner of the Australian Federal Police v Zhao, the High Court granted a stay of civil forfeiture (asset confiscation) proceedings to protect a defendant's right to a fair trial in related criminal proceedings. The Court's decision contributes to a body of law that addresses the question how a court should respond when the conduct of civil, disciplinary or inquisitorial proceedings threatens to prejudice the fair conduct of criminal proceedings.

The facts

On 2 July 2013 Mr Xin Jing was charged with offences against the Commonwealth Criminal Code. Shortly after the charges were laid, the Commissioner of the Australian Federal Police commenced proceedings in the County Court of Victoria seeking an order that the family home of Mr Jing and his wife, Ms Qing Zhao, be forfeited under the Proceeds of Crime Act 2002 (Cth) on the grounds that the property represented proceeds of the offences with which Mr Jing was charged.
Mr Jing and Ms Zhao sought an order that the forfeiture proceedings be stayed until the charges against Mr Jing had finally been determined. They argued that defending the forfeiture proceedings would require Mr Jing either to give evidence that might be used against in him in the criminal proceedings or to divulge the details of his defence before the conclusion of the prosecution's case. Mr Jing and Ms Zhao said that to allow the forfeiture proceedings to continue would rob Mr Jing of his right to silence.
The application for a stay of the forfeiture proceedings was refused in the County Court. However, an appeal to the Court of Appeal was successful. The AFP Commissioner then appealed to the High Court.

The High Court's Decision

The High Court determined unanimously that the Commissioner's appeal should be dismissed. In reaching its decision, the Court first noted that the continuation of the forfeiture proceedings would expose Mr Jing to a risk of prejudice in his defence of the criminal proceedings. The Court then held that the interests of justice would not be served by 'requiring the second respondent to defend the forfeiture proceedings or pursue the exclusion proceedings before his criminal proceedings are finalised, especially since the Commissioner will suffer no relevant prejudice from a delay in the continuation of the forfeiture proceedings.'

Relevance of the decision

Zhao builds on a series of recent decisions, including X7 v Australian Crime Commission and Lee v The Queen, in which the High Court has considered the means by which courts may ensure that the conduct of civil, disciplinary or inquisitorial proceedings does not prejudice the interests of an accused in pending criminal proceedings, either by requiring the accused to divulge his or her defence ahead of time or by requiring the accused to provide information that is likely to be incriminating. The cases show that courts have a range of means of ensuring that the fair conduct of criminal proceedings is not prejudiced by the conduct of other proceedings, such as:

• A stay order like the one in Zhao may be made by a superior court in its supervisory jurisdiction or may be made by an inferior court in the exercise of its implied powers. A superior court also has inherent jurisdiction to restrain contempt; this jurisdiction extends to making an order restraining a body with investigative powers (such as a disciplinary board) from seeking to compel a person charged with an offence from answering questions that relate to pending criminal proceedings.
• Where a statutory provision confers investigative powers on an office holder, a court will be reluctant to interpret the provision in a manner that empowers the office holder to compel the production of information that relates to pending criminal proceedings. It is only where clear and unambiguous terms are employed that a statute will be interpreted to require the production of information in breach of an accused's right to silence.
• Even where a provision empowers a statutory office holder to compel a person to provide information that may implicate him or her in the commission of an offence, the information will generally be held to be subject either to 'use immunity' or 'derivative use immunity'. Use immunity prevents information obtained by an investigator pursuant to his or her compulsive powers from being used directly in criminal proceedings. Derivative use immunity prevents evidence found or discovered as a result of the giving of information to an investigator from being admitted.

Finally, where an accused has been required by an investigating body to provide information in breach of his or her right to silence, improper provision of that information to prosecuting authorities may require any subsequent conviction to be quashed.

For queries relating to any of the issues identified in this blog, please contact:

Jonathan Bayly
Principal Solicitor
jonathan.bayly@vgso.vic.gov.au

Rodney McInnes
Principal Solicitor
rodney.mcinnes@vgso.vic.gov.au

ACCC v Coles Supermarkets Australia Pty Ltd - Implied waiver of legal professional privilege

Introduction
Legal professional privilege (LPP) is a common law right [1] which protects the confidentiality of communications between a client and their legal adviser.  LPP generally prevents the compulsory disclosure of a confidential communication, whether ordered by a court (for example subpoenas or discovery) or by a person or body with similar compulsive powers. [2]
 
Where a client waives the confidentiality of a communication, any LPP attaching to that communication is lost.  Disputes sometimes arise as to whether, despite a client wanting to claim that a communication is still confidential, they have impliedly waived confidentiality by saying or doing something inconsistent with that position. [3]

So in what circumstances might a person say or do something inconsistent with maintaining the confidentiality of a privileged communication?

The recent case of ACCC v Coles Supermarkets Australia Pty Ltd (ACCC v Coles) [4] considered this question in the context of a dispute about baked bread.

The facts of ACCC v Coles
In mid-2012, Coles began selling bread products through its in-store bakeries which had been ‘par baked’ by certain suppliers.  The ACCC commenced proceedings in the Federal Court seeking various forms of relief and penalties, alleging that Coles’ advertising of these bread products using slogans such as “Freshly Baked In-Store” and “Baked Today, Sold Today” was misleading and deceptive.  Coles denies this allegation.

To narrow the issues in dispute, the parties sought to formulate an agreed statement of facts (ASOFs). [5]  In the course of negotiating the contents of the ASOFs, Coles’ lawyers sent a letter to the ACCC’s lawyers (the November Letter) describing information about the baking processes used by the suppliers.  This information was summarised from confidential correspondence sent to Coles’ lawyers by its suppliers. [6]

The ACCC sought the issue of subpoenas to Coles' suppliers requiring production of copies of this confidential correspondence.  While the ACCC accepted that LPP attached to these documents, it argued that Coles had waived confidentiality in these documents because it had disclosed the 'gist' of them in the November Letter.

The decision
The Federal Court held that while the November Letter disclosed the gist of the communications, this was not inconsistent with a maintenance of confidentiality in the documents.  It noted that legal representatives in litigation regularly exchange correspondence summarising their clients' instructions or other confidential communications, and that it may have a 'chilling effect' on such exchanges (which are helpful in negotiating agreed facts) to find that they result in an implied waiver.

Another factor which was considered important by the Court was that the ACCC could still adduce evidence about Coles' suppliers' baking processes in the usual way (ie by way of evidence in the case, rather than in an ASOFs), regardless of whether the correspondence from the suppliers was available for inspection by the ACCC.

For these reasons, the Federal Court decided that Coles had not impliedly waived LPP in the documents by sending the November Letter. 

What does this mean for the Public Sector?
ACCC v Coles Supermarkets highlights the importance of the relevant context in assessing whether the voluntary disclosure of the gist of a confidential communication constitutes an implied waiver.  Courts tend to look at the practical effect of deeming that confidentiality has been waived, and will consider what is fair in all of the circumstances.

However, there can be any number of situations where disclosing the 'gist' of a privileged communication could be enough to result in a loss of LPP.  The context will be different in each case and may involve complex policy considerations, making it difficult to predict what effect such disclosure will have.

For this reason, it is never wise to reveal the contents of communications with your legal advisers, or documents prepared in relation to legal matters without first obtaining advice.  One can't always, after all, eat one's cake and still have it. 

For advice on this issue, contact:

David Ryan

Managing Principal Solicitor

t 03 8684 0417
david.ryan@vgso.vic.gov.au

Martin Pike

Principal Solicitor

t 03 9032 3007
martin.pike@vgso.vic.gov.au

Matthew Carrazzo

Senior Solicitor

t 03 8684 0497
matthew.carrazzo@vgso.vic.gov.au

Note: Judgement was reserved in the substantive application in the proceeding by Allsop CJ on 21 February 2014.

---

[1] In Victoria, Division 1 of Part 3.10 of the EvidenceAct 2008 (Vic) has codified LPP for the purposes of court proceedings to which that Act applies, renaming it ‘client legal privilege’ (CLP).  Some aspects of the privilege are different between the common law and the Evidence Act, none of which are directly relevant for the purposes of this blog post.
[2] In rare cases, statutory powers will abrogate privileges, so that they cannot protect disclosure where these powers are exercised.  See for example, section 143 of the Independent Broad-based Anti-corruptionCommission Act 2011.
[3] The common law was stated in the High Court case of Mann v Carnell (1999) 201 CLR 1 at 13.  Section 122 of the Evidence Act 2008 (Vic) applies essentially the same test as the common law to determine whether a client has impliedly waived CLP.
[4] [2014] FCA 45.
[5] See section 191 of the Evidence Act1995 (Cth), and its equivalent provision in the Evidence Act 2008 (Vic).
[6] At common law, LPP can also attach to confidential documents sent by a third party to a legal advisor so long as they are for the dominant purpose of providing the client with legal advice or for current or contemplated litigation.  The situation is the same under the Evidence Act 2008 (Vic): see section 119(b).

'Watershed' moment in Victorian litigation culture?: Yara Australia Pty Ltd v Oswal [2013] VSCA 337

Introduction
The Victorian Court of Appeal has sent a strong message that the overarching obligation under section 24 of the Victorian Civil Procedure Act 2010 - to ensure that the costs of litigation are 'reasonable and proportionate' - is ignored by lawyers and litigants at their peril.

The decision
The proceedings followed the collapse of a fertiliser business, which had been placed into administration in 2010.  Judicial commentary on the overarching obligations arose in an appeal against an earlier decision on security for costs.

An apparently straight-forward matter was attended by five senior counsel, six junior counsel, and five firms of solicitors, who filed over 2700 pages of evidence in support of the application.  The Court sought an explanation from the parties as to whether any breaches of the overarching obligations under the Civil Procedure Act 2010 had occurred.

The Court determined that the parties were not 'overrepresented' - due to the complexity of the issues and the likely costs of future proceedings.  As each of the applicants had separate and distinct interests, the Court found that each were entitled to separate representation.  The Court was careful to emphasise that section 24 of the Civil Procedure Act concerning proportionate costs 'is not to be construed as requiring a party to forfeit that right'.

The Court determined that much of the 2700 pages of material filed was either duplicative or 'peripheral to the application or entirely unnecessary', such as:

• old statements of claim
• reams of email correspondence
• materials from related but immaterial proceedings in other states and jurisdictions.

It was found that the inclusion of the material violated section 24 on the basis that it increased costs for all parties and placed an unnecessary burden on the court.

What do the 'overarching obligations' require lawyers and litigants to do - or not do?
Section 24 of the Civil Procedure Act 2010 provides:

A person to whom the overarching obligations apply must use reasonable endeavours to ensure that legal costs and other costs incurred in connection with the civil proceeding are reasonable and proportionate to—
(a) the complexity or importance of the issues in dispute; and
(b) the amount in dispute.

The judgment cites the second reading speech to the Act, in which the then Attorney-General Hulls stated:

At the core of these reforms is the concept of proportionality. Participants in litigation will be required to use reasonable endeavours to ensure that legal and other costs spent in the proceeding are reasonable and proportionate to the complexity or importance of the issues in dispute, and the amount in dispute […] These provisions are designed to cure unnecessary expenditure on litigation and the inappropriate use of the courts as a public resource.

The overarching obligations apply to litigants and legal practitioners alike.  Importantly, legal practitioners are required to act in accordance with the overarching obligations even when this conflicts with client instructions.

What does this decision mean for litigation culture in Victoria?
Addressing a recent National Costs Lawyers conference at the Law Institute of Victoria, Justice Croft said that the judgment was a 'watershed' moment:

It is clear that practitioners can no longer hold the mistaken belief that the obligations under the Act are merely aspirational rather than obligatory.

Since late last year, the case has been raised in seven other proceedings, suggesting that Victoria's judiciary is willing to make use of case management tools to contain the costs of litigation.

But we're model litigants anyway, aren't we? 
The State of Victoria is subject to the Model Litigant Guidelines which require government entities to abide by high standards of litigant conduct, including keeping costs to a minimum, and avoiding unnecessary delay.

While the decision in Yara may not alter the approach of model litigants, it provides important guidance from Victoria's highest court on the scope of the overarching obligations contained in the Civil Procedure Act 2010, by which all litigants - including model litigants - are bound.

The Court warned future litigants that they will effectively be under a positive obligation to demonstrate that materials are compliant with the overarching obligations:

Where a large volume of material is provided to a court that is unnecessary and excessive, there will be a prima facie case that the overriding obligation has been breached. [emphasis added]

We will be watching this space closely for future decisions in this area.

For more information about Yara Australia Pty Ltd v Oswal [2013] VSCA 337, please contact:

Andrew Suddick
General Counsel
t 8684 0458
andrew.suddick@vgso.vic.gov.au

Antonio Mazzone
Managing Principal Solicitor
t 8684 0418
antonio.mazzone@vgso.vic.gov.au

New laws may make discovery less awful!

The discovery process in litigation has broken many a litigation lawyer's heart, and horror stories of junior lawyers spending endless months reviewing documents abound.

The Australian Law Reform Commission recently noted that discovery is often the single largest cost in commercial litigation. It can amount to huge public cost and represents a barrier to justice reducing the effectiveness of the court system.

Indeed, in the Supreme Court matter of Matthews v SPI Electricity Pty Ltd & Ors, Associate Justice Zammit stated:

discovery is a topic that attracts a great deal of attention due primarily to the exorbitant costs that are incurred by the parties and the delay caused in litigation. The Court has long recognised that discovery disputes, large scale unfocussed discovery exercises and the resulting costs, work against the interests of the parties to the litigation, the operation of the civil justice system and ultimately the interest of the community.

Fortunately, the Government has introduced legislation granting courts greater discretionary case management powers to simplify and reduce the costs of discovery and disclosure of documents for parties in civil litigation.

The Justice Legislation Amendment (Discovery, Disclosure and Other Matters) Bill 2014 (the Bill) amends the Civil Procedure Act 2010 (the Act) to give the courts additional powers to better manage the discovery process.

Under the amendments, the courts could order that parties discuss the preparation of a statement of the main issues in the proceeding. This statement would be used in pre-trial processes to narrow the issues in dispute. This approach is consistent with the overarching obligation in s 23(b) of the Act which states that a party must use reasonable endeavours to narrow the scope of the remaining issues in dispute. Traditionally, the purpose of pleadings is to outline the issues in dispute, but they can be long and difficult documents which sometimes fail to adequately do this. The statement will not replace pleadings but will give the courts and litigants a new tool to help litigation run more efficiently and cost effectively.

To ease the costs burden, the court will also be able to order that the party who requested discovery pay some or all of the costs where appropriate. In other words, a court will be able to say to a party, ‘if you want it, you pay for it’.

To further reduce the cost burden on the providing party, the Bill also allows the court, if the parties consent, to order a party to provide to another party all documents within their possession or control that are related to the issues in the proceedings, subject to safeguards to ensure that a party is not prejudiced. This will mean that the requesting party rather than the providing party is responsible for the time and cost of reviewing the documents, again encouraging parties to minimise the cost of discovery. This is a significant amendment and one which it will be interesting to see if it is taken up by commercial litigants and their lawyers, anxious not to forego privilege despite the amendments providing safeguards to ensure that privilege is safeguarded.

Problems can arise when companies use different systems and databases to store their business records. This can cause delay and increase costs as discoverable documents are difficult to identify. The Bill aims to remedy this by providing courts with the power to order that parties give an affidavit which sets out information regarding a party’s document management systems, volume, manner of arrangement, and location of documents. If required the deponent of an affidavit or other suitable person can be orally examined on those matters dealt with in the affidavit.

This will allow parties to more easily identify documents, particularly in the context of complex document storage and other IT systems, and minimise disputes about discovery.

So the new Bill won't go so far as to make discovery enjoyable, but it will hopefully encourage a cultural shift in Victorian litigation to make the process less painful for lawyers and clients alike.

 

The take home points

• The Bill builds on last year's rule changes which also aimed to reduce the costs of discovery
• Clients will need to be able to readily identify their data storage systems
• Victorian Government parties should seek advice before disclosing documents subject to public interest immunity or state secrecy obligations under the new regime. Remember: the State bears the burden of establishing that production would not be in the public interest.

For more information about discovery or this Bill, please contact:

Andrew Suddick
General Counsel
t 8684 0458
andrew.suddick@vgso.vic.gov.au

Antonio Mazzone
Managing Principal Solicitor
t 8684 0418
antonio.mazzone@vgso.vic.gov.au

Gabriella Mazzone
Seasonal Clerk

The VGSO’s guide to sexting

An employer in a Federal Court proceeding was recently forced to defend an attempt by a dismissed employee to have a number of private text messages - allegedly left on a work-issued mobile phone after it was issued to another employee - admitted into evidence.

Shea v TruEnergy Services Pty Ltd concerned an employee who had been dismissed by her employer, TruEnergy, on the grounds that her position had become redundant. The employee brought proceedings alleging that she had actually been dismissed for exercising a workplace right by making a number of complaints, and that her dismissal therefore constituted adverse action within the meaning of the Fair Work Act 2009 (Cth).

One of the employee's allegations during the course of the trial was that a culture of lewdness and sexual harassment prevailed in the workplace and that it was condoned by the managing director. She sought to have admitted into evidence a number of mobile phone text messages, apparently between the managing director and a former general counsel at TruEnergy with whom he was allegedly having an affair. Their content was, it was alleged, of a sexually explicit nature, and the employee submitted that this established the managing director's propensity to use lewd and sexualised language in the workplace.

The employee obtained the text messages via another former employee of TruEnergy who allegedly had been given a work-issued mobile phone that had not been cleared of its messages. That former employee still had possession of the phone and had failed to return it following the cessation of her employment.

TruEnergy sought to resist the admission of the text messages as evidence on the grounds that they were not relevant to any issue in the dispute, and in any event should be excluded as they were improperly or illegally obtained.

Justice Dodds-Streeton of the Federal Court agreed with TruEnergy and refused the admission of the evidence, finding that not only were the text messages 'intensely personal' communications, they were not relevant to any issue in the litigation. Her Honour also rejected the submission that, even if their contents could be described as 'lewd', it did not follow that the managing director would use such language in the workplace. Further, the messages were inadmissible due to the irregular or improper manner in which the employee had obtained this confidential material.

Although the contents of the mobile phone in this instance was held not to be admissible, this case serves as an important reminder to departments and agencies to ensure that employer-issued IT hardware, such as mobile phones and laptops, is properly wiped prior to being issued to a new employee, and that all equipment issued to an employee is recovered and retained when that employee leaves.

The case is also a reminder that, when it comes to evidence, relevance is still king. Even though litigators today have access to so much more information on phones, computers and social media, it's only going to be admitted into evidence if it is relevant to issues that the court or tribunal have to decide. In this sense, this case is just an example of old principles being applied to new (and fantastically salacious) facts.

If you are in the Victorian Government and you are thinking about sexting from a work phone, how about you first seek advice from:

Katie Miller
Managing Principal Solicitor
t 8684 0460
katie.miller@vgso.vic.gov.au

Retta Berryman
Trainee Solicitor
t 8684 0468
retta.berryman@vgso.vic.gov.au

　

How to draft an enforceable dispute resolution clause

When will a dispute resolution clause be enforceable? The Supreme Court recently grappled with this question in WTE Co-Generation v RCR Energy. The decision is a helpful guide on how to create a dispute resolution clause that achieves its aim. It also highlights the danger of commercial dispute resolution clauses that are effectively 'agreements to agree', which may be unenforceable due to a lack of precision.

Background

This case related to a contract for the supply of a co-generation facility, intended to be fired by paper mill residues, for a price of in excess of $20m. While the facility was constructed, the superintendent did not certify practical completion as being reached, ultimately resulting in the plaintiff issuing a notice to the defendant purporting to terminate the contract.

 

An application was made by the defendants that the proceeding be stayed until the parties had complied with a contractual resolution clause.

 

That clause provided that:

In the event that the parties have not resolved the dispute then within a further 7 days a senior executive representing each of the parties must meet to attempt to resolve the dispute or to agree on methods of doing so.

The defendants argued that there had been no compliance with clause 42, while the plaintiffs position was that the clause was uncertain and unenforceable.

 

The Decision

Justice Vickery found that the clause effectively amounted to an agreement to agree and was therefore not enforceable due to its inherent uncertainty.

 

Justice Vickery cited with approval the statement in the New South Wales Court of Appeal decision in Coal Cliff Collieries v Sijehama Pty Ltd that '…in some circumstances a promise to negotiate in good faith will be enforceable, depending on its precise terms…'.

 

Further, his Honour set out a number of principles to determine whether a stay should be granted where a contractual dispute resolution process is expressed to be a pre-condition of litigation, including:

1. That such clauses should be determined robustly to give them commercial effect by avoiding a 'narrow or pedantic approach in favour of a commercially sensible construction'.
2. Where express words are at issue that are broad and general, but nevertheless have sensible and ascribable meaning, the court should give effect to such provisions.
3. Public policy in promoting efficient dispute resolution, especially commercial dispute resolution, requires enforceable content be given to contractual dispute resolution clauses where possible.

Justice Vickery found the dispute resolution clause not to amount to a valid agreement to negotiate however, as it essentially amounted to an agreement to agree for the following reasons:

1. Once the operation of the clause was triggered, it required the parties to either meet together to resolve the dispute, or to agree on methods for doing so. These requirements fell short of prescribing a process to determine which option is to be pursued.
2. No method of resolving the dispute is prescribed by the clause. Rather, the clause expressly contemplates that the method for resolving the dispute is to depend on the parties' further agreement as to the methods to be employed.

His Honour outlined that, whilst a valid dispute resolution clause does not require a set of rules to be set out:

…as a minimum, what is necessary for a valid and enforceable dispute resolution clause, is to set out the process or model to be employed, and in a manner which does not leave this to further agreement. It is not for the court to substitute its own mechanism where the parties have failed to agree upon it in their contract. To do so would involve the court in contractual drafting, which is a distinctly different exercise from contractual construction of imprecise terms.

 

If you are in the Victorian Government and wish to discuss the implications of this case further, please contact:

 

Antonio Mazzone

Managing Principal Solicitor

t 8684 0418

antonio.mazzone@vgso.vic.gov.au

 

Andrew Suddick

General Counsel

t 8684 0458

andrew.suddick@vgso.vic.gov.au

High Court tells lawyers to play fair

Play fair and double-check what you send to the other side are the two lessons for litigators coming out of the recent High Court decision of ERA Group v Armstrong.

In the course of discovery in a commercial dispute involving some 60,000 documents, the ERA Group’s solicitors mistakenly provided Armstrong’s solicitors with documents that were confidential and subject to client legal privilege. 

Oops. 

ERA Group’s solicitors then sought return of the material and an undertaking from Armstrong’s solicitors not to use the privileged material in the litigation.  But Armstrong’s solicitors refused to return the documents, arguing that the privilege attaching to the documents had been waived.

The trial judge found for the ERA Group and ordered return of the documents.  But the Court of Appeal sided with Armstrong.  The High Court overturned that decision with a very clear message about lawyers’ professional and ethical obligations to support the proper administration of justice. 

In doing so, it noted that mistakes are more likely to occur in discovery in ‘heavy litigation conducted by large teams of lawyers of varying experience and the indiscriminate use of photocopying’ so the good faith of the parties is paramount in such matters.

The Court noted that the new Australian Solicitor’s Conduct Rules (not yet incorporated in Victoria) require a solicitor to return material which is known or reasonably suspected to be confidential, where the solicitor is aware that its disclosure was inadvertent.

The Court suggested "such a rule should not be necessary," as "in the not too distant past it was understood that acting in this way obviates unnecessary and costly interlocutory applications…  It is an example of professional, ethical obligations of legal practitioners supporting the objectives of the proper administration of justice.”

It is a fundamental principle of legal professional practice that, as lawyers, our duty to the court trumps all of our other duties.  Fortunately, such behavior is rare in government lawyers as they must also follow the Model Litigant Guidelines.  These require government litigants to (amongst other things):

• act fairly in litigation
• not cause unnecessary delay
• keep litigation costs to a minimum.

But this reminder by the High Court to think twice about adopting a win-at-all-costs approach is still a useful read for government lawyers, even just for the reminder to do one last proofread before hitting ‘send’…

If you are in the Victorian Government and would like advice on the ethical obligations applicable to government litigants, please contact:

Andrew Suddick
General Counsel (Litigation)
t 8684 0458
andrew.suddick@vgso.vic.gov.au

10 tips for drafting top witness statements

1. Interview witnesses alone (or with an interpreter only, if necessary).  Otherwise, it is open to suggestion later that there was collusion between witnesses.  It also makes it easier to assess the impression a witness will ultimately give when in court. 
2. Use the first person and the witness’s own words.  The witness may be cross-examined on the statement and needs to be able to understand their own evidence.  Draft the statement in chronological order.  It should tell a story. 
3. Use the past tense – the witness is describing the state of affairs at the time of the relevant incident. 
4. Use short sentences and short paragraphs.  Each paragraph should be numbered and should cover a single point.
5. Where a witness makes a statement in their professional capacity, the statement may state their business address rather than residential address.
6. You generally need to avoid hearsay evidence (that is, evidence based on what someone has told the witness and not of direct knowledge).  You can however include hearsay evidence in witness statements for interlocutory hearings, provided the witness identifies the source of the evidence given.  The best way to avoid including hearsay evidence is to draft the statement so the witness’s evidence is confined to what they actually saw, heard, or smelt.
7. Statements such as ‘I understood’ or ‘I thought’ or ‘I intended’ should be avoided unless state of mind is an issue.  If state of mind is an issue then set out the words of a conversation or describe what the witness saw from which the court can conclude that the witness had the relevant state of mind.
8. Similarly, avoid conclusions in a witness statement.  
• Just describe what the witness did.  The lawyer can ask the court to make the necessary conclusion during argument.  
• For example, rather than ‘I would not have said something like that because it is not written in my notes’, try 'I always take my notebook with me when I meet with a client.  My practice during any meeting with a client is to write in my notebook any recommendations that I make to a client about the next steps they should take'.
9. Where possible, conversations should be expressed in the actual words used by the relevant people.  
• For example: On 24 December 2012, I met with Mr Claus at his business address, and we had a conversation to the following effect: ‘Rudolph would be available to work this week’. 
• Otherwise, use words describing the nature of the recollection of the witness, for example: I met with Mr Claus on 24 December 2012 at his business address.  I do not recall the actual words used.  I asked him a number of questions.  One thing I asked him about was the staff numbers he expected over the holiday period.  In his answer, he referred to Rudolph, Dasher and Dancer as employees who were confirmed to work the following week. 
10. A witness statement needs to be signed by the person who made the statement, but does not need to be witnessed by someone else.  Australian legal practitioners, plus the following categories of Victorian public servants, are able to witness affidavits and statutory declarations:
• Non-executive employee grades 2 to 6 (inclusive) and Senior Technical Specialist
• Solicitor, Senior Solicitor, Principal Solicitor and Principal Solicitor (Team Leader)
• Executive (Level 1, Level 2 and Level 3)
• Principal Scientist or Principal Scientist Level PS-1 and PS-2
• Science A to D (inclusive)
• Forensic Officer Level 2 to Level 7 (inclusive)
• Child Protection Practitioner CPP 2 to CPP 6 (inclusive)
• Children Youth and Families CYF 2 to CYF 6 (inclusive)
• Housing Services Officer HSO
• Senior Medical Adviser SMA
• Disability Development and Support Officer DDSO4 to DDSO9 (inclusive)
• Custodial Officers COG4 to COG6 (inclusive).

If you are in the Victorian Government and want more information about drafting witness statements or litigation strategy, please contact:

Martin Pike
Principal Solicitor
t  8684 0413
martin.pike@vgso.vic.gov.au

8 things you need to know about the Open Courts Bill

The Open Courts Bill kicks off in December 2013, popping all the suppression order powers of the Victorian courts and VCAT into one convenient piece of legislation.

In case you don’t know, a suppression order is a court order restricting publication or other disclosure of information in connection with a court proceeding.  A closed court order is an order restricting who can be in the courtroom during a proceeding.

Whilst it is primarily a consolidation of the current law, there are some important differences for Victorian litigators to keep in mind:

1. The Bill creates express presumptions in favour of disclosure of information and holding hearings in open court.  A court or tribunal must have regard to these presumptions when considering whether to make a suppression order or a closed-court order.
2. The Bill expressly provides that that suppression and closed court orders can only be made in specified limited circumstances where there is a strong and valid reason for doing so.
3. Where a suppression order is made, the information that is restricted from disclosure must be limited to that which is necessary to achieve the purpose for which the order is made.  The information to which the order relates must also be clearly stated in the order.  Also, the order must be limited to achieving the purpose for which it is made.
4. Suppression orders must be limited in their duration.  A court or tribunal may only make an order for a fixed or ascertainable period, or until the occurrence of a specified future event.  If it is possible that the future event will not occur, the order also must contain an expiry period of less than five years.
5. Before making a suppression order, a court or tribunal must be satisfied on the basis of sufficient credible information that the applicant has satisfied the grounds for making a suppression order.  
6. The Bill expressly protects the right for news organisations to be heard on and contest an application for a suppression order.  News organisations are also given express statutory rights to seek review of orders that are made.
7. The Supreme Court does retain its powers to make suppression and closed-court orders in the exercise of its inherent jurisdiction, but subject to:
• The presumptions in favour of disclosure and public hearings; and 
• The procedural requirements regarding duration, limited scope, evidentiary basis and review.
8. The Bill proposes grounds on which a suppression order may be made.  These include:
• Preventing prejudice to the proper administration of justice
• Preventing prejudice to national or international security
• Protecting the safety of any person
• Avoiding undue distress or embarrassment to a party to or witness in criminal proceedings involving a sexual offence or family violence offence
• Avoiding undue distress or embarrassment to a child who is a witness in any criminal proceeding.

This consolidates the existing grounds, except for the last two, which are worthy additions.

If you are in the Victorian Government and want more information about suppression orders or the Open Courts Bill, please contact:

Dianna Gleeson
Acting Managing Principal Solicitor
t 8684  0404
dianna.gleeson@vgso.vic.gov.au

What to do when someone throws the Constitution at you

It can happen to any litigator.  Show up to court, ready to argue your (seemingly non-constitutional) case, only to be faced with a constitutional argument and the resultant scurrying around as the parties try to ascertain and meet the notice requirements under the Judiciary Act 1903 (Cth).

The procedure isn’t complicated, but it has been known to catch parties unaware.  This is because constitutional arguments can pop up in many types of litigation and often after proceedings have commenced.  This means that lawyers who would not otherwise practice in these areas may need to quickly get their head around the procedure and its rationale.

Here’s a quick how-to guide.

Section 78B of the Judiciary Act requires a notice to be sent to all nine Attorneys-General whenever any court proceeding ‘involves a matter arising under the Constitution or its interpretation’.  Don’t forget the Territories!  See our previous post on how to serve the Victorian Attorney-General.  The other jurisdictions have similar agreements with their government solicitors.

The court ‘cannot proceed’ until it is satisfied that this procedure has been followed.  However, s 78B(2)(c) enables a court to continue to hear evidence and argument on matters that are severable from the constitutional question.  And s 78B(5) provides that a court may proceed immediately to hear urgent interlocutory proceedings where the court thinks it necessary to do so. 

If the constitutional point is frivolous or unarguable, the Court can determine that s 78B does not apply.  The matter must ‘really and substantially’ involve a matter arising under the Constitution to invoke s 78B, meaning the argument has to relate to a live issue in the proceeding and has to have some merit.

The court does not need to wait for a response from all Attorneys-General before proceeding.  It is sufficient if steps have been taken that ‘could reasonably be expected to cause the matters to be notified to be brought to the attention of that Attorney-General’.

The point of the s 78B procedure is to make sure that the Commonwealth and the various States and Territories have the opportunity to be heard before any court decision about the Constitution.  This is because their interests can be affected by decisions on constitutional law, particularly ones decided by the High Court.  When an Attorney-General intervenes, the courts also get the benefit of the legal skills of the various Solicitors-General (who generally represent their respective Attorneys-General in constitutional proceedings, at least in the High Court).

The obligation to issue notices applies in every court in Australia, from the High Court to the Magistrates Court.  VCAT does not have power to determine questions arising under the Constitution and thus the 78B question should not arise in that forum.

The courts have introduced Rules to regulate procedural issues arising from the giving of s 78B notices – see Part 5 of the High Court Rules, Division 8.2 of the Federal Court Rules, Order 19 of the Supreme, County and Magistrates Court Rules.  Note that in the federal courts, the party that raised the argument must prepare the notice, whereas the State Rules permit a court to order a different party prepare the notice.  Victorian courts have been known to order that the State party prepare a notice outlining a constitutional argument raised by another party, which can be very difficult if that party is unable to clearly enunciate that argument.

If you are in the Victorian Government and require advice on constitutional litigation, please contact:

Rachel Amamoo
Managing Principal Solicitor
t 8684 0899
rachel.amamoo@vgso.vic.gov.au

How to sue the government

As government lawyers, you may receive originating processes served on your department or agency.  One of the first questions you should ask is whether it identifies the correct State party.

This is not always as easy as it seems.  Here’s an overview of the basic rules.

Of course, if you are served with documents and you intend to engage our office, you should do so as soon as possible to ensure you meet the deadlines for filing response documents.

Civil and constitutional cases

Federal courts

In federal courts, the State must bring any suit in the name of the Attorney-General of Victoria or his appointee.  But in the rare situation that the State responds to an action in a federal court, the correct party would generally be the State of Victoria (as here).

To serve the State in a Federal or High Court proceeding, you should serve the Attorney-General or the VGSO (on his behalf).  Our service details are here.

State courts

To sue the Victorian government in a State court, the correct party is generally the State of Victoria.

This includes where the State of Victoria is vicariously liable for the torts of its servants or agents.  However, if the grievance is with a statutory corporation about a contract it has entered into or a tort of any of its servants or agents, the correct party is the relevant statutory corporation.

In all State courts, service of documents on the State of Victoria is via the VGSO.
We are also authorised to accept service on behalf of Ministers.

Judicial review (in the Supreme Court)

In judicial review proceedings (whether brought under Order 56 or the Administrative Law Act), the application for review or originating motion must be directed to:

• the relevant decision-maker (or its members); and
• any party interested in maintaining the decision.

For example, in this case, the Municipal Building Surveyor had issued notices asking a property owner to demonstrate why he was permitted under the Building Act to use some flats at Docklands as serviced apartments.  The property owner appealed the notices to the Building Appeals Board, who dismissed the Appeal.  The parties to the Supreme Court judicial review proceeding were:

• as plaintiff – the property owner;
• as first defendant – the Building Appeals Board (who took a Hardiman position, that is, took no active role in the proceeding);
• as second defendant – the person fulfilling the role of Municipal Building Surveyor who issued the notices; and
• as third defendant – the Council who appointed the Surveyor.

If the decision-maker is a judicial or public authority or the holder of public office, he or she should be described by the name of the authority or office.  For example, in this case, the defendant was correctly identified as the “Health Services Commissioner” (an office created by statute), rather than the name of the person who held the office at the time. 

What if the body that made the decision is not a legal entity?  For example, in this case, the respondent was the Appeals Costs Board – a statutory body comprised of a number of people appointed by the Attorney-General that was not a body corporate.  The Supreme Court said the proper respondents were the particular members of the Board who made the decisions sought to be reviewed.

Finally, it is important to identify the person or body who actually made the decision being challenged.  In this case, a prisoner sought (amongst other things) an injunction allowing him to send a letter to one of his victims.  He applied for an injunction against the Commissioner for Corrections.  But under the Corrections Act, it is the Governor of a prison that has the power to stop letters from prisoners, not the Commissioner.  The Court asked for the application to be brought against the correct defendant.

Merits review (in VCAT)

In a merits review proceeding, the parties are:

• the applicant;
• the decision-maker who made the decision;
• any person joined as a party to the proceeding by the Tribunal; and
• any other person specified by legislation as a party (for example, co-owners of land in an application to sell co-owned land).

As with judicial review, a decision-maker who is the holder of a public office or holds a position in the public service is to be described by their position.

Unlike judicial review, a person whose interests are affected by the decision does not have a right to party status.  The tribunal may decide not to join a party if their joinder would cause expense or delay.

Also unlike judicial review, the appropriate respondent may be an unincorporated body. For example, in freedom of information cases, unincorporated bodies can be considered the ‘agency’ that made the decision.

And finally, unlike judicial review, the decision-maker who made the decision may not take a Hardiman approach and must play an active role in the proceeding, helping the Tribunal understand the decision.

If you are in the Victorian government and have been served with court documents, please contact:

Stephen Lee
Assistant Victorian Government Solicitor
t 8684 0410
stephen.lee@vgso.vic.gov.au

How to be a five-star witness

Government solicitors are often asked to prepare departmental or other witnesses to give evidence in court or VCAT.  You may not coach witnesses, that is, suggest answers to questions.  But here are some tips that you can provide to them to make their (and your) life easier before what can be a nerve-wracking experience.

The days before

• Do not discuss your evidence with other witnesses.
• Review any notes or statements you have made.
• Find out where the court is and how long it will take you to get there.
• Find out how long you will be needed for.  Courts normally sit from 10 until 4, with a one-hour break at 1pm.  VCAT listings vary.  Every effort will be made to minimise the time you spend at court, but be prepared to wait.

On the day

• Bring any statements or notes you have made about the case with you to court. Tell the solicitor which documents you have brought.
• Choose clothes that show respect for the judge and the court proceedings.  Look professional, dressing appropriately for your position.
• Make sure there are no sharp or glass objects in your bag (e.g. knitting needles, tweezers, umbrellas).
• Get to court in good time.  There may be a queue to pass through security.
• Turn your phone off before you enter the courtroom.

In the minutes before

• Sit outside the courtroom until it is time for you to give evidence.  Someone will come and get you when it is your turn.
• Before giving evidence, you will be asked if you wish to take an oath or make an affirmation that your evidence is true.   

Giving evidence

• The claimant in a civil action or the prosecution in a criminal trial will put their case first. Their witnesses will give evidence and be cross-examined (by asking additional questions).  The witness may then be ‘re-examined’. Once this process has happened, the defence will do the same with its witnesses.
• The Judge, Magistrate or Member may also ask you questions about your evidence.  You should address the Judge or Magistrate as ‘Your Honour’.  In VCAT, it depends on the seniority of the Member hearing your case:
• The VCAT President is addressed as ‘Your Honour’
• Vice Presidents are addressed as ‘Judge’.
• Members are addresses as ‘Sir’ or ‘Madam’ or as ‘Ms’ or ‘Mr’ and the Member’s surname. 
• Giving evidence is not a memory test.  You don’t get points for answering every question.  Do not guess or speculate. If you are not sure about an answer, just say so, else you may do more harm than good.  You can’t say, for example, ‘I would have done X’ or speculate about why a person acted in a particular way.
• Listen to and think about each question before you answer. 
• Give evidence in your own words.
• Make your answers as specific as you can.  Do not generalise.
• If you do not understand a question, you should say so.
• Do not say what someone else has told you unless you are asked.
• Explain any technical terms you have to use.
• Speak clearly so that your evidence can be understood. The microphone in front of you only records your voice. It does not make it louder.  You are giving evidence to the judge, so face them when answering a question
• You should not look at your notes without permission from the Judge.  If you are having trouble remembering details or accurately answering the questions, ask the Judge for permission before looking at any notes that you made at the time when the events were fresh in your memory.
• Cross-examination normally takes the form of a series of propositions put to you by the other side’s barrister. If you do not agree with all parts of the proposition, say so.  If you do not know whether a proposition is right, say so.  Don’t just agree with the barrister because you don’t want to seem obstinate.
• Don’t lose your patience with the other side’s barrister when being cross-examined.  The best witnesses remain neutral and focused. 
• If a witness has never been cross-examined before, one way a solicitor can help a witness understand how it feels is to engage in a mock cross-examination beforehand, using the type of questioning styles that a barrister would use in court.  This mock cross-examination should not be based on facts similar to the actual hearing.
• If you qualify as an expert witness (and meet all the requirements for this status), you may give opinions within your expertise.  Otherwise you can only give evidence of facts.

After

• After you have given your evidence and are excused by the court, you are free to leave. You may stay in the courtroom if you wish, unless you are expected to give evidence again later in the case.

VGSO has a network of experienced advocates who can represent Victorian government clients in all courts and tribunals.  Briefing our in-house advocates, rather than a barrister, can be more cost effective and ensures access to our expertise in specialist areas of Victorian government law.  Having regard to the demands of a particular matter, we can provide advocates ranging from our Special Counsel to solicitors of various seniority.  For more information about VGSO advocates, please contact

Hayley Petrony
Assistant Victorian Government Solicitor
t 9947 3011
hayley.petrony@vgso.vic.gov.au

Deep pockets to no longer cop it

Governments around Australia introduced proportionate liability legislation in the early 2000s to help cut the price of insurance.  They intended to prevent ‘deep pocket’ defendants being held entirely liable for losses to which others contributed.  Yet judges have since interpreted the legislation to allow maximum recovery to plaintiffs.

The High Court has recently handed down a decision that restores the original aims of the proportionate liability regime.  It is good news for a ‘deep pocket’ defendant like the government, as its liability (in a non-personal injury action) is likely to be limited to that for which it is actually responsible, as was always intended by the legislation. 

The decision is Hunt & Hunt v Mitchell Morgan Nominees Pty Ltd [2013] HCA 10. 

Facts

Mitchell Morgan was a lender. Hunt & Hunt were their lawyers. They had prepared a mortgage instrument for a loan from Mitchell Morgan to a Mr Vella and a Mr Caradonna.  The instrument was registered against property owned by Mr Vella alone. Unbeknownst to either the lender or the lawyers, Mr Caradonna had forged Mr Vella's signature on the loan documents and on the mortgage instrument.  Mr Caradonna spent the loaned money and then become bankrupt.

Mitchell Morgan therefore could not recover the money from Mr Caradonna.  Nor could it recover from Mr Vella, as the mortgage instrument was void because of the forgery.  So it turned to Hunt & Hunt…

Trial history

The NSW Supreme Court held that Hunt & Hunt had been negligent in preparing the mortgage instrument. Hunt & Hunt did not appeal this finding.  The issue for the High Court was whether the proportionate liability provisions applied, limiting Hunt & Hunt’s liability to a percentage of the total loss that reflected their culpability.

Justice Young of the Supreme Court had found they did and apportioned only 12.5% of the liability to Hunt & Hunt.  But the Court of Appeal found the provisions did not apply, as the loss caused by Mr Caradonna was different to the loss caused by Hunt & Hunt.  It found that Mitchell Morgan was therefore entitled to recover 100% of its damages from Hunt & Hunt.

High Court

A 3:2 majority of the High Court agreed with the trial judge, finding that the proportionate liability regime under Part 4 of the NSW Civil Liability Act 2002 (which is in all material respects identical to Part IVAA of the Victorian Wrongs Act 1958) applied. 

The Court found that the distinct wrongs committed by Mr Caradonna and by Hunt & Hunt had caused a single economic loss for Mitchell Morgan, being its inability to recover the money lent to Mr Caradonna.  Mr Caradonna and Hunt & Hunt were therefore concurrent wrongdoers, bringing the NSW proportionate liability provisions into play.

The Court clarified that ‘it is not a requirement of proportionate liability that the actions of one independent concurrent wrongdoer contribute to the negligence of another. The question is whether each of them, separately, materially contributed to the loss or damage suffered’. 

In other words, it was enough that Mr Caradonna and Hunt & Hunt had both contributed to Mitchell Morgan’s loss, broadly described as its inability to recover the money that it had advanced.

Implications

This decision will be of significance to solicitors, insurance brokers, valuers, accountants and other professionals whose calling requires them to protect clients from the economic consequences of wrongs committed by others.  Proportionate liability will likely now reduce these professionals’ exposure in many cases.

However, it is important that any government body in negligence proceedings (other than personal injury) identify all possible concurrent wrongdoers. This now includes any person who materially contributed to the loss. It does not matter that each concurrent wrongdoer may have caused the loss in a different way or even that one of the wrongdoers acted fraudulently.

For example, this decision could apply in property damage or economic loss cases that name an emergency service provider as a defendant (assuming a duty of care was owed, which would depend on the circumstances). If a fire fighting authority negligently failed to stop a chemical leak caused by a third party, this decision suggests that the fire fighting authority and the third party would be concurrent wrongdoers.   This means that the fire fighting authority would only have to pay a portion of the total damages, rather than the full amount.  As such, this decision may prove to be good news for emergency service providers in certain classes of proceedings for damages. 

What do you think about this development? Will it achieve the goals of the proportionate liability regime?

For more information on this decision or for advice on your dispute resolution strategy, please contact:

Jon Bayly
Principal Solicitor
t  8684 0223 
jonathan.bayly@vgso.vic.gov.au

Farewell party-party

Since 1 April 2013, the Supreme Court of Victoria has had a new costs regime.  It applies to all proceedings, even if they were commenced before that date.

It’s likely to result in more generous costs orders.  Parties currently in litigation should consider this as part of their dispute resolution strategy.

Here are the major changes to the Rules that you need to know:

• No more ‘party-party’ costs.  Previously, there were three ways the Court could calculate the legal costs payable by a party under a costs order:
• party-party - the default method, based on what was considered to be the ‘necessary or proper’ work for a particular case;
• solicitor-client - costs ‘reasonably incurred and of reasonable amount’; and
• indemnity - all costs incurred, unless unreasonable.

The new default method for calculating costs is the more generous solicitor-client basis.  This has been renamed the ‘standard basis'.  Indemnity costs may still be ordered.

This means that under a standard costs order, successful litigants will recover more of their legal spend than they would have under the old regime. 

• Interlocutory costs are not now recoverable until the end of the proceeding (unless leave is sought).
• A successful party with a costs order in their favour will generally be entitled to:
• reserved costs (previously, the Court would make orders on a case by case basis);
• the cost of an interlocutory application (previously, parties typically bore their own interlocutory costs); and
• costs from amending a pleading (previously, the amender typically bore the cost).

The Scale of Costs is now more generous, more simplified and more in line with modern litigation practices (bad news for all the litigators out there conducting proceedings by telex). 

Five changes you might be interested in:

• The Scale is now exclusive of GST.
• Use of the six-minute unit. Solicitors’ time for attendances will now be claimable in six-minute units, which is the time recording system used by most private law firms (not VGSO – we only record the time we actually spend.  Crazy, we know…).  A six-minute unit is calculated at $36 plus GST per unit.  This amounts to a higher hourly rate than previously (where the amount recoverable depended on the nature of the attendance). 
• Maximum fees payable for counsel.  Unless otherwise ordered, recovery of counsel’s fees is capped at a maximum of $5000 plus GST per day for junior counsel and $7500 plus GST per day for silks.  
• The cost of photocopying (previously claimable at $2.30 per page) is now entirely discretionary.  The Supreme Court has indicated that copying is likely to be allowed at 22 cents per printed side of page where copied in-house.
• The scale provides for the sending of messages that are 20 words or less by email or SMS or other electronic means.

What do you think about these changes? Do you think it will affect parties’ litigation strategy?

For more information on the changes to the Supreme Court costs regime or for advice on your dispute resolution strategy, please contact:

Andrew Suddick
General Counsel (Litigation)
t  8684 0458 m 0408 037 927
andrew.suddick@vgso.vic.gov.au