CIVIL PROCEDURE IN
NEW SOUTH WALES
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CIVIL PROCEDURE IN
NEW SOUTH WALES
FOURTH EDITION
MIIKO KUMAR
Crown Prosecutor, Barrister at Law
PROFESSOR MICHAEL LEGG
Faculty of Law University of New South Wales
ILIJA VICKOVICH
Macquarie Law School Macquarie University
DR JAMES METZGER
Faculty of Law University of New South Wales
LAWBOOK CO. 2020
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ISBN: 9780455243467
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DEDICATION
Miiko Kumar dedicates her
chapters to Marco, Lenny and
Heidi
Michael Legg dedicates this book
to Laetitia, Maxime and
Alexandre
Ilija Vickovich dedicates his work
on this edition to the health of his
sons Aleks, Daniel and Damien
James Metzger dedicates his chapters
to Carol Metzger
v
FOREWORD
The Hon John Basten
Judge, NSW Supreme Court, Court of Appeal
It may be that law students, and even neophyte lawyers, do not instinctively identify civil procedure
as an intrinsically interesting, intellectually demanding or even an important topic. They would be
wrong on each count. To know substantive law provides only half the picture. Some examples readily
demonstrate why this is so.
Take the plaintiff sleeping in the cabin of his prime mover while his co-driver undertakes a night time
stretch of a rural highway. A black bull wanders in front of the vehicle. The fully laden road train hits
the bull and overturns. The plaintiff is seriously injured. Who was at fault, and how should the plaintiff
find out? Is there an applicable limitation period? If so, when will it expire? Resolutions of these
procedural questions can be as complex and demanding as the tests of negligence and occupier’s
liability which will underpin any claim.
Other recent issues have concerned the power of the NSW Civil and Administrative Tribunal (NCAT)
to deal with landlord and tenant disputes where the landlord of NSW premises resides interstate; the
right of an unsuccessful party in bankruptcy proceedings in the Supreme Court to appeal to the New
South Wales Court of Appeal; and whether a court hearing a class action could order that a portion of
a putative award of damages be payable to the plaintiff’s litigation funder and lawyers, thus allowing
security for their fees in the event the claim is successful. Can the same be done for creditors in a
corporate liquidation?
Sometimes courts exercise “inherent” powers which are not expressly conferred by statute or rules
made under a statute; do tribunals enjoy similar inherent powers as a result of their establishment and
constitution? In many disputes, one party will benefit from speedy resolution, while the other would
prefer delay and procrastination. Sometimes the parties, or one of them, thinks that they can resolve
the dispute if the court will answer separately and in advance of a full trial, one specific question. The
party asks the judge to state a question for separate determination. When should that procedure be
adopted? Will it really shortcut a potentially costly trial, or will it undermine the orderly resolution of
the whole dispute? Usually the process will work only if the question is answered one way. Even if that
occurs, will the losing party seek to appeal? Large forensic battles can be fought over such procedural
steps.
Are our procedures well attuned to delivery of just, quick and cheap justice? This book provides
materials to allow any thoughtful reader to explore such questions and assess the justifications for the
answers.
Like most subjects in a modern law school curriculum, a proper understanding of procedure requires
skills in statutory interpretation. All law students now receive, or should receive, specialised training
in this intellectual discipline. In the past, courses on statutory interpretation, rather like courses on
civil procedure, have been undervalued, or taught interstitially in substantive courses. Civil procedure
requires skill in construing such materials in a special context. To understand a document, it is necessary
to see the actual text, not just read what a judge has said about it. This book sets out the important
statutory provisions and the relevant rules. It also provides key forms, which will help readers who do
not have ready access to such materials.
Finally, as the world grows in complexity, so do dispute settlement procedures. The efforts of the
authors in keeping this valuable text up to date are much to be commended. This fourth edition is
most welcome.
vii
PREFACE
Civil Procedure in New South Wales provides a scholarly yet accessible account of the New South Wales
civil justice system. The text addresses the key procedures prior to the commencement of proceedings
and throughout the life cycle of litigation by way of both a principled and practical approach –​from
the initiation of proceedings through key steps such as pleadings, service, discovery and evidence to
enforcement. Explanations and commentary are provided with reference to relevant provisions of the
Civil Procedure Act 2005 (NSW), the Uniform Civil Procedure Rules 2005 (NSW), the Evidence Act 1995
(NSW), the Legal Profession Uniform Law and extracts of illustrative cases. The text also deals with
fundamental principles of our civil justice system such as open justice, fair trial, case management and
lawyers’ ethical requirements.
Miiko Kumar, Michael Legg and Ilija Vickovich have convened and taught the compulsory civil
procedure courses at the University of Sydney, University of New South Wales (UNSW) and Macquarie
University respectively over a number of years. They also have numerous years of experience as
practitioners in New South Wales. For the fourth edition, they are joined by Dr James Metzger from
UNSW who has convened and taught civil procedure at UNSW and the University of Sydney. This text
draws on the authors’ combined experience.
The text is aimed at the novice and those recently initiated but seeks to take students and practitioners
alike into some of the more advanced or practical areas such as interim preservations orders, service
overseas, class actions, commercial arbitration, electronic discovery, the preparation of witnesses and
expert evidence. It is hoped that the text will not only perform its primary teaching role but also assist
students as they make the transition to litigation and dispute resolution practitioners.
The authors would also like to thank past students, lecturers and other users of previous editions of the
text whose questions and suggestions have assisted in revising the content of the text. The authors
would like to express their appreciation to the Hon John Basten for writing the Foreword. Thanks
are also due to the Thomson Reuters staff who have shepherded this book to completion, including
Elizabeth Gandy, and Nicholas Riley.
Miiko Kumar, Michael Legg, Ilija Vickovich and James Metzger
Sydney, December 2019
ix
CONTENTS
Dedication............................................................................................................................................. v
Foreword.............................................................................................................................................. vii
Preface................................................................................................................................................. ix
Table of Cases..................................................................................................................................... xiii
Table of Statutes.............................................................................................................................. xxvii
1
Introduction to Civil Procedure............................................................................ 1
2
Case Management in New South Wales............................................................ 67
3
Costs of Litigation................................................................................................ 119
4
Alternatives to Litigation –​Negotiation and Mediation............................. 187
5
Alternatives to Litigation –​Arbitration, Referees and Expert
Determination...................................................................................................... 237
6
Before a Civil Action Commences..................................................................... 287
7
Causes of Action and Parties............................................................................. 357
8
Class Actions in New South Wales.................................................................... 415
9
Initiating Proceedings and Pleadings.............................................................. 487
10 Amendment, Mistakes and Adjournments..................................................... 527
11 Service of Documents.......................................................................................... 575
12 Discovery, Subpoenas and Interrogatories..................................................... 615
13 Preparing and Presenting Evidence................................................................. 741
14 Privilege................................................................................................................. 835
15 Concluding Proceedings..................................................................................... 929
16 Civil Procedure in Context............................................................................... 1011
Index.............................................................................................................................................. 1055
xi
TABLE OF CASES
A
A v Bird; C v Bird [2015] NSWSC 570 ..................................................................................... [1.298]
A & N Holding NSW Pty Ltd v Andell Pty Ltd [2006] NSWSC 55 ............................................... [2.20]
A Goninan & Co v Atlas Steels (Aust) Pty Ltd [2003] NSWSC 956 ........................................... [7.450]
ACP Magazines Pty Ltd v Motion [2000] NSWSC 1169 ........................................................... [3.390]
AFP Commissioner v Propend (1997) 188 CLR 501 ..................................................[14.90], [14.100]
ASIC v Rich [2006] NSWSC 712 .............................................................................................. [9.110]
ASIC v Sweeney (No 2) [2001] NSWSC 477; 38 ACSR 743 ................................................... [11.220]
AWB Ltd v Cole (No 5) (2006) 155 FCR 30; [2006] FCA 1234 .............................................. [14.165]
Ada Evans Chambers Pty Ltd v Santisi [2014] NSWSC 538 ...................................................... [3.380]
Adams v Kennick Trading (Int) Ltd (1986) 4 NSWLR 503 ........................................................ [15.60]
Agar v Hyde (2000) 201 CLR 552; 173 ALR 665; 74 ALJR 1219; [2000] HCA 41 ................... [11.430]
Ahmad v South Western Sydney Local Health District [2018] NSWSC 1327 .......................... [12.480]
Ahmed El Hayek v Josslyn Vasic & Anor; QBE Insurance (Australia) Limited v
Wesfarmers Federation Insurance Pty Ltd [2010] NSWSC 1498 ........................................ [12.480]
Ainsworth v Redd (1990) 19 NSWLR 78 ................................................................................ [11.120]
Air Link Pty Ltd v Paterson (2005) 218 ALR 700; (2005) 79 ALJR 1407; [2005] HCA 39 ......... [10.155]
Air Link Pty Ltd v Paterson (No 2) [2003] NSWCA 251 .......................................................... [10.130]
Aiton v Transfield [1999] NSWSC 996 ..................................................................................... [4.340]
Alderman v Zurich Australian Insurance Ltd [2011] NSWSC 754 ............................................. [14.40]
Alister v The Queen (1984) 154 CLR 404 .............................................................................. [14.300]
Allesch v Maunz (2000) 203 CLR 172 ................................................................................... [15.300]
Allianz Australia Insurance Ltd v Newcastle Formwork Constructions Pty Ltd [2007]
NSWCA 144 ...................................................................................................................... [9.330]
Altarama Ltd v Forsyth [1981] 1 NSWLR 188 .......................................................................... [15.30]
Amos Removals & Storage Pty Ltd v Small (1981) 2 NSWLR 525 .......................................... [11.190]
Anglo-​Cyprian Trade Agencies Ltd v Paphos Wine Industries Ltd [1951] 1 All ER 873 .............. [3.110]
Annetts v McCann (1990) 170 CLR 596 ................................................................................. [11.70]
Anton Piller KG v Manufacturing Processes Ltd [1976] 1 Ch 55 ............................................... [6.220]
Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175;
[2009] HCA 27 ............................................................................ [2.10], [2.250], [3.110], [10.40]
Apple Inc v Samsung Electronics Co Ltd [2011] FCA 1164 ...................................................... [6.163]
Arenson v Casson Beckman Rutley & Co [1977] AC 405 ........................................................... [5.20]
Arhill Pty Ltd v General Terminal Company Pty Ltd (1990) 23 NSWLR 545 ........................... [11.220]
Arthur Stanley Smith (1996) 86 A Crim R 309 ......................................................................... [1.200]
Attorney-​General v Scott I [1905] 2 KB 160 .............................................................................. [7.30]
Attorney-​General (NSW) v Chidgey (2008) 182 A Crim R 536; [2008] NSWCCA 65 ...
[12.400], [12.420]
Attorney-​General (NSW) v Mayas Pty Ltd (1988) 14 NSWLR 342 ............................................ [1.170]
Attorney-​General (NSW) v Nationwide News Pty Ltd (2007) 73 NSWLR 635; [2007]
NSWCCA 307 .................................................................................................................. [14.300]
Attorney General for NSW v Stuart (1994) 34 NSWLR 667 ....................... [14.40], [14.290], [14.300]
Attorney-​General (NT) v Maurice (1986) 161 CLR 475 ......................................................... [14.218]
Australian Broadcasting Corporation v O’Neill (2006) 227 CLR 57; 229 ALR 457;
[2006] HCA 46 .................................................................................................................. [6.166]
Australian Competition and Consumer Commission v Chats House Investments Pty
Ltd (1996) 71 FCR 250 ...................................................................................................... [8.750]
Australian Competition and Consumer Commission v Prysmian Cavi E Sistemi Energia
SRL [2011] FCA 938 ..........................................................................................[14.300], [14.330]
Azzi v Volvo Car Australia Pty Ltd (2007) 71 NSWLR 140 ...................................................... [14.410]
xiii
Civil Procedure in New South Wales
B
B v Auckland District Law Society [2003] 2 AC 736 ............................................................... [14.218]
BHP Billiton Ltd v Schultz [2004] HCA 61; (2004) 221 CLR 400 .....................................[6.40], [6.50]
BUSB v King [2011] NSWCCA 39 ...............................................................................[1.170], [1.200]
BWK Elders Australia Pty Ltd v Westgate Wool Company Pty Ltd (No 2) [2002] FCA 87 .......... [9.320]
Baggs v University of Sydney Union [2013] NSWCA 451 ........................................................ [6.138]
Bailey v Federal Commissioner of Taxation [1977] HCA 11; (1977) 136 CLR 214 .................... [9.280]
Baker v Campbell (1983) 153 CLR 52 ......................................................................[14.90], [14.100]
Baker-​Morrison v New South Wales [2009] NSWCA 35; (2009) 74 NSWLR 454 ...................... [6.120]
Bank of Western Australia Ltd v Callipari [2011] NSWSC 138 ................................................ [10.250]
Banque Commerciale SA (in liq) v Akhil Holdings Ltd (1990) 169 CLR 279 ................[1.320], [9.100]
Barnes v Commissioner of Taxation (2007) 242 ALR 601; [2007] FCAFC 88 .......................... [14.120]
Barton v Minister for Foreign Affairs (1984) 2 FCR 463; 54 ALR 586 ........................................ [3.450]
Batistatos v Roads and Traffic Authority of New South Wales (2006) 226 CLR 256;
227 ALR 425; [2006] HCA 27 ...............................................................................[1.40], [15.100]
Baulderstone Hornibrook Engineering Pty Ltd v Gordian Runoff Ltd [2006] NSWSC 583 ........ [3.210]
Baulderstone Hornibrook Engineering Pty Ltd v Gordian Runoff Ltd [2008] NSWCA 243 ........ [1.140]
Bechara v Bates [2018] FCA 460 ............................................................................................. [3.380]
Beck v Weinstock; Beck v L W Furniture (Consolidated) Pty Ltd [2012] NSWCA 289 ............... [7.160]
Bellevarde Constructions Pty Ltd v CPC Energy Pty Ltd [2008] NSWCA 228 ............................ [5.270]
Bell Lawyers Pty Ltd v Pentelow [2019] HCA 29 ...................................................................... [3.380]
Bendir v Anson [1936] 3 All ER 326 ......................................................................................... [7.210]
Berry Rural Co Operative Society Ltd v Sepak Industries Pty Ltd [2018] NSWSC 298 ............... [3.250]
Best v Samuel Fox & Co Ltd [1952] AC 716 ............................................................................ [3.380]
Bhagat v Murphy [2000] NSWSC 892 .......................................................................[3.410], [3.480]
Bi v Mourad [2010] NSWCA 17 .................................................................................[2.50], [15.160]
Biguzzi v Rank Leisure Plc [1999] 1 WLR 1926 ...................................................................... [14.230]
Birtles v Commonwealth [1960] VR 247 ................................................................................. [7.240]
Blair v Curran (1939) 62 CLR 464 ............................................................................................. [7.60]
Bleyer v Google Inc [2014] NSWSC 897 ................................................................................... [3.57]
Blue Oil Energy Pty Limited v Tan [2014] NSWCA 81 .............................................................. [3.410]
Board of Examiners v XY [2006] VSCA 190; (2006) 25 VAR 193 .............................................. [3.110]
Boral Bricks Pty Ltd v Cosmidis [2013] NSWCA 443 ................................................................ [9.300]
Bostock v Ramsey Urban District Council [1900] 2 QB 616 ..................................................... [3.110]
Botany Bay City Council v Minister for Local Government (No 2) [2016] NSWCA 127 .......... [15.268]
Bradken Resources Pty Ltd v The ANI Corp Ltd [2002] NSWSC 463 ........................................ [5.300]
Bray v F Hoffmann-​La Roche Ltd (2003) 130 FCR 317; [2003] FCAFC 153;
[2003] FCA 1505 ..................................................................... [7.415], [8.300], [8.890], [8.1000]
Breen v Williams (1996) 186 CLR 71 ..................................................................................... [14.218]
Bright v Femcare Ltd (2002) 195 ALR 574; [2002] FCAFC 243 ....................... [8.40], [8.394], [8.420]
Brisbane South Regional Health Authority v Taylor [1996] HCA 25;
(1996) 186 CLR 541 .................................................................................................[6.60], [6.70]
British American Tobacco Australia Limited v Secretary, Department of Health and
Ageing (2011) 195 FCR 123; [2011] FCAFC 107 ................................................................ [14.20]
Building Insurers’ Guarantee Corporation v Touma [2010] NSWSC 4 .................................... [15.170]
Bulldogs Rugby League Club Ltd v Williams [2008] NSWSC 822 ........................................... [11.240]
Bullock v London General Omnibus Co [1907] 1 KB 264 ........................................................ [3.320]
Burwood Council v Ralan Burwood Pty Ltd (No 2) [2014] NSWCA 179 .................................. [8.190]
Buzzle Operations Pty Ltd (in liq) v Apple Computer Australia Pty Ltd (No 2)
[2010] NSWSC 490 ......................................................................................................... [13.640]
C
CSR Ltd v Eddy [2005] HCA 64; (2005) 226 CLR 1; [2005] HCA 64 ........................................ [3.380]
xiv
Table of Cases
Cachia v Hanes (1994) 179 CLR 403 ............................................................ [3.380], [3.190], [3.360]
Cadence Australia Pty Ltd v Chew [2008] NSWSC 1076 ....................................................... [13.710]
Cain v Glass (No 2) (1985) 3 NSWLR 230 ................................................................[1.200], [14.300]
Calderbank v Calderbank [1975] 3 All ER 333; [1975] 3 WLR 586 .........................[15.260], [15.265],
[15.268]
Campbells Cash & Carry Pty Ltd v Fostif Pty Ltd (2006) 229 CLR 386;
[2006] HCA 41 ...................................................................................................[8.130], [8.1040]
Campbelltown-​Minto Merchants Association Inc v Campbelltown City Council
[2009] NSWLEC 70 .......................................................................................................... [13.490]
Carbotech-​Australia Pty Ltd v Yates [2008] NSWSC 1151 ........................................................ [14.40]
Cardile v LED Builders Pty Ltd (1999) 198 CLR 380; 73 ALJR 657;
[1999] HCA 18 .....................................................................................................[6.170], [6.190]
Carnie v Esanda Finance Corp Ltd (1995) 182 CLR 398 .............................................[8.130], [8.470]
Carnie v Esanda Finance Corp Ltd (1996) 38 NSWLR 465 ....................................................... [8.130]
Carr v Finance Corporation of Australia Ltd (1981) 147 CLR 246 .......................................... [15.350]
Carroll v Attorney General (NSW) (1993) 70 A Crim R 162 ................................................... [12.400]
Carter v Northmore Hale Davy & Leake (1995) 183 CLR 121 ................................................ [14.218]
Carus-​Wilson & Greene, Re (1886) 18 QBD 7 ........................................................................... [5.20]
Cash Converters International Limited v Gray [2014] FCAFC 111 ...............................[8.300], [8.330]
Cassanti v Paragalli (2006) 229 ALR 416 ................................................................................. [14.40]
Cassegrain v Gerard Cassegrain & Co Pty Ltd [2011] NSWSC 241 ........................................ [12.480]
Cassell & Co Ltd v Broome [1972] UKHL 3; [1972] AC 1027 ................................................... [3.380]
Cave v Allen Jack and Cottier Pty Ltd [2014] NSWSC 1365 ..................................................... [5.230]
Champerslife Pty Ltd v Manojlovski (2010) 75 NSWLR 245;
[2010] NSWCA 33 ................................................................................................[7.130], [7.150]
Chapman v Chapman [2007] NSWSC 1109 ......................................................................... [13.440]
Chapman v Luminis Pty Ltd (No 2) (2000) 100 FCR 229;
[2000] FCA 1010 ............................................................................................................. [14.300]
Chappell v Coyle (1985) 2 NSWLR 73 ....................................................................[11.190], [11.220]
Charafeddine v Morgan [2014] NSWCA 74 ............................................................................ [7.160]
Charlie Carter Pty Ltd v The Shop, Distributive and Allied Employees’ Association of
Western Australia (1987) 13 FCR 413 ................................................................................. [9.150]
Chocolate Factory Apartments Pty Ltd v Westpoint Finance Pty Ltd
[2005] NSWSC 784 ..............................................................................................[5.255], [5.260]
Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission
(2000) 203 CLR 194 ........................................................................................................ [15.290]
Colgate-​Palmolive Pty Ltd v Cussons [1993] FCA 536; (1993) 46 FCR 225 .............................. [3.400]
Colin Joss & Co Pty Ltd v Cube Furniture Pty Ltd [2015] NSWSC 735 ........................[5.150], [5.160]
Collier v Lancer (No 2) [2013] NSWCA 186 .......................................................................... [15.140]
Commissioner Australian Federal Police v Propend Finance Pty Ltd
(1997) 188 CLR 501 ......................................................................... [14.110], [14.120], [14.218]
Commissioner for Railways, The v Small (1938) 38 SR 654 ....................................[12.145], [12.390]
Commonwealth v Mewett (1997) 191 CLR 471; [1997] HCA 29 ............................................ [3.110]
Commonwealth Bank of Australia v ZYX Learning Centres Ltd [2014] NSWSC 1676 ............. [15.140]
Commonwealth of Australia v Bank of New South Wales (1949) 79 CLR 497 ........................ [15.285]
Commonwealth of Australia, The v Northern Land Council (1993) 176 CLR 604 .................. [14.300]
Compagnie Financiere et Commerciale du Pacifique v Peruvian Guano Co
(1882) 11 QBD 55 ........................................................................................................... [12.180]
Cornelius v Global Medical Solutions Australia Pty Ltd [2014] NSWCA 65 ............................... [3.410]
Cosmos E-​C Commerce Pty Ltd v Bidwell & Associates Pty Ltd [2005] NSWCA 81 .................. [15.90]
Coulter v The Queen (1988) 164 CLR 350 ............................................................................ [15.340]
Courtney v Medtel Pty Ltd [2001] FCA 1037 .......................................................................... [8.830]
Cox v Joumeaux (1935) 52 CLR 713 ..................................................................................... [15.130]
Cronau v Vavakis (No 2) [2018] NSWSC 1644 ........................................................................ [15.60]
Cronau v Vavakis (No 3) [2018] NSWSC 1973 ........................................................................ [15.60]
xv
Civil Procedure in New South Wales
D
D v National Society for the Prevention of Cruelty to Children [1978] AC 171 ...................... [14.300]
Da Hui Wu v Statewide Developments Pty Ltd [2009] NSWSC 587 ....................................... [13.480]
Da Silva Moore v Publicis Groupe, 287 FRD 182 (SDNY 2012) .............................................. [12.356]
Dai v Zhu [2013] NSWCA 412 ................................................................................................ [15.60]
Daniels Corporation International Pty Ltd v Australian Competition and Consumer
Commission (2002) 213 CLR 543 .......................................................................[14.90], [14.218]
Dank v Cronulla-​Sutherland District Rugby League Football Club (No 3)
[2013] NSWSC 1850 ......................................................................................................... [15.60]
Dank v Cronulla Sutherland District Rugby League Football Club Ltd
[2014] NSWCA 288 ........................................................................................................... [15.60]
Dank v Whittaker (No 1) [2013] NSWSC 1062 ....................................................................... [15.60]
Dare v Pulham (1982) 148 CLR 658; 57 ALJR 80; 44 ALR 117; [1982] HCA 70 ...........[9.130], [9.360]
Darwalla Milling Co Pty Ltd v F Hoffman-​La Roche Ltd (No 2) [2006] FCA 1388 ..................... [8.715]
Dasreef Pty Ltd v Hawchar [2011] HCA 21 ............................................................................ [13.270]
David Brown v BCA Trading [2016] EWHC 1464 (Ch) ........................................................... [12.357]
Dawdy, Re (1885) 15 QBD 426 .............................................................................................. [5.340]
Daya v CNA Reinsurance Co Ltd [2004] NSWSC 795 .............................................................. [4.270]
De Jong v Carnival PLC (No 3) [2016] NSWSC 1461 ............................................................. [8.1003]
Dean-​Willcocks v Air Transit International (2002) 55 NSWLR 64; [2002] NSWSC 525 .............. [7.270]
Debis v Allied Bellambi Collieries [2000] NSWCA 274 ........................................................... [15.350]
Delta Electricity v Blue Mountains Conservation Society Inc [2010] NSWCA 262 ...................... [3.57]
Deveigne v Askar (2007) 69 NSWLR 327; (2007) 239 ALR 370; [2007] NSWCA 45 ............... [10.210]
Dey v Victorian Railways Commissioners (1949) 78 CLR 62 ..................................................... [15.70]
Dietrich v King (1992) 177 CLR 292 ....................................................................................... [1.320]
Dimitrovski v Australian Executor Trustees Limited [2014] NSWCA 68 ..................................... [7.160]
Director-​General, Dept of Community Services v D (2006) 66 NSWLR 582;
[2006] NSWSC 827 ..........................................................................................[14.240], [14.260]
Director of Public Prosecutions (DPP) v Marijancevic (2011) 33 VR 440;
[2011] VSCA 355 .......................................................................................................[13.220]
Director of Public Prosecutions v Smith (1996) 86 A Crim R 308 ........................................... [14.300]
Dodds Family Investments Pty Ltd (formerly Solar Tint Pty Ltd v Lane Industries Pty
Ltd) (1993) 26 IPR 261 ...................................................................................................... [3.200]
Donald Campbell & Co v Pollak [1927] AC 732 ...................................................................... [3.110]
Dorajay Pty Ltd v Aristocrat Leisure Ltd (2005) 147 FCR 394 ................................................... [8.630]
Douglas v John Fairfax & Sons Ltd [1983] 3 NSWLR 126 ........................................................ [9.350]
Douglas Corporation v Currico Nominees [2007] NSWSC 113 ............................................. [12.145]
Dow Jones & Co v Gutnick (2002) 210 CLR 575 ....................................................................... [7.60]
Dr Bronte Douglass v Lawton Pty Ltd (No 2) [2007] NSWCA 90 ............................................. [3.100]
Duke of Bedford v Ellis [1901] AC 1 .......................................................................................... [8.80]
Dunwoodie v Teachers Mutual Bank Ltd [2014] NSWCA 24 .................................................... [15.60]
DuPont Nutrition Biosciences ApS v Novozymes A/​S (UK) [2013] EWHC 155 ........................ [14.230]
E
Egan v Chadwick (1999) 46 NSWLR 563 .............................................................................. [14.300]
Eades v Endeavour Energy [2018] NSWSC 801 ..................................................................... [8.1007]
Edwards v Hornsby Shire Council [2014] NSWSC 600 .......................................................... [12.480]
Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 ....................... [5.85]
Environment Protection Authority v Queanbeyan City Council [2011] NSWLEC 159 ............... [14.40]
Esanda Finance Corporation Ltd v Carnie (1992) 29 NSWLR 382 ............................................ [8.130]
Esso Australia Resources Ltd v Commissioner of Taxation (Cth) (1999) 201 CLR 49;
168 ALR 123; [1999] HCA 67 ................................................................ [14.30], [14.40], [14.90],
[14.120], [14.130], [14.140]
xvi
Table of Cases
Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management
and Marketing Pty Ltd (2013) 250 CLR 303; [2013] HCA 46 .............................[2.255], [14.215],
[14.218], [14.230]
F
FPM Constructions Pty Ltd v City of the Council of the Blue Mountains
[2005] NSWCA 340 ........................................................................................................... [3.400]
Falls Creek Ski Lifts Pty Ltd v Yee (1995) 37 NSWLR 344 ....................................................... [11.220]
Fastlink Calling Pty Ltd v Macquarie Telecom Pty Ltd [2008] NSWSC 299 ............................. [13.140]
Fawcett v Cannon [2007] NSWSC 1267 ............................................................................... [15.130]
Femcare Ltd v Bright (2000) 100 FCR 331 ................................................................................ [8.40]
Fenwick v Wambo Coal Pty Ltd (No 2) [2011] NSWSC 353 .................................................. [14.200]
Fexuto v Lombe and Yates [2006] NSWSC 981 ....................................................................... [10.40]
Fiduciary v Morningstar Research [2004] NSWSC 664 ............................................................ [3.410]
Field v Commissioner for Railways (1957) 99 CLR 285 .......................................................... [14.400]
Filipowski v Frey [2005] NSWLEC 166 ................................................................................... [11.220]
Films and Casting Temple v Malla [2013] NSWCA 377 ..................................................[9.70], [9.80]
Findex Group Ltd v McKay [2019] NSWCA 93 ........................................................................ [6.250]
Flo Rida v Mothership Music Pty Ltd [2013] NSWCA 268 .......................................[11.210], [11.220]
Fox v Percy (2003) 214 CLR 118; [2003] HCA 22 ..................................................[15.290], [15.320]
Francis Travel Marketing Pty Ltd v Virgin Atlantic Airways Ltd (1996) 39 NSWLR 160 .............. [4.340]
Franks & Anor v Berem Constructions Pty Ltd (unreported, NSWCA 2 December
1998, BC 9806367) ........................................................................................................... [5.260]
Frizelle v Bauer [2009] NSWCA 239 ........................................................................................ [6.130]
G
Gardiner v The Queen (2006) 162 A Crim R 233 .................................................................. [14.300]
General Steel Industries Inc v Commissioner of Railways (NSW) (1964) 112 CLR 125 .............. [15.70]
Gerlach v Clifton Bricks Pty Ltd (2002) 209 CLR 478 ............................................................. [15.350]
Gibbs & McAllion Lloyd Pty Ltd v Kinna [1999] 2 VR 19; [1998] VSCA 52 ............................... [7.100]
Giles v Commonwealth of Australia [2014] NSWSC 83 ................................................[8.40], [8.430]
Giles v Commonwealth of Australia (No 2) [2014] NSWSC 1531 .......................................... [12.240]
Gillett v Robinson [2011] NSWSC 863 .................................................................................. [13.570]
Glencore International AG v Commissioner of Taxation [2019] HCA 26 ................................ [14.218]
Glover v Australian Ultra Concrete Floors Pty Ltd [2003] NSWCA 80 ....................................... [9.230]
Goater v Commonwealth Bank of Australia [2014] NSWCA 382 ........................................... [15.410]
Goldberg v Ng (1995) 185 CLR 83 ......................................................................................... [14.90]
Goldsmith v Sandilands (2002)190 ALR 370; [2002] HCA 31 .................................................. [9.140]
Goddard v Nationwide Building Society [1987] QB 670 ....................................................... [14.218]
Goold & Porter Pty Ltd v Housing Commission [1974] VR 102 ............................................... [7.180]
Graczyk v Graczyk [1955] SLR (CN) 1077 ............................................................................. [11.120]
Graham v Minister for Immigration and Border Protection [No 2] [2018] FCA 1116 ............... [3.110]
Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540; [2002] HCA 54 ......................... [8.860]
Grant v Downs (1976) 135 CLR 674; [1976] HCA 63 .............. [14.120], [14.140], [14.165], [14.218]
Graphite Energy Pty Ltd v Lloyd Energy Systems Pty Ltd [2014] NSWSC 1326 .......[12.240], [12.280]
Grassby v The Queen (1989) 168 CLR 1 ........................................................................[1.40], [1.50]
Great Atlantic Insurance Co v Home Insurance Co [1981] 1 WLR 529 ..................................... [14.90]
Green (as liquidator of Arimco Mining Pty Ltd) v CGU Insurance Ltd [2008] NSWCA 148 ....... [3.430]
Greenacre Business Park Pty Ltd v Deliver Australia Pty Ltd (in liq) [2014] NSWSC 1646 ......... [3.400]
Greenwood v Papademetri [2007] NSWCA 221 .....................................................[10.160], [10.170]
Guinness Peat Properties Ltd v Fitzroy Robinson Partnership [1987] 1 WLR 1027;
[1987] 2 All ER 716 .......................................................................................................... [14.230]
Guss v Veenhuizen [No 2] [1976] HCA 57; (1976) 136 CLR 47; [1976] HCA 57 ...................... [3.380]
xvii
Civil Procedure in New South Wales
H
HIH Insurance Ltd, Re [2007] NSWSC 498 .................................................................[1.240], [1.260]
Habib v Radio 2UE Sydney Pty Ltd [2009] NSWCA 231 ............................................................ [3.57]
Hall v Nominal Defendant (1966) 117 CLR 423 .....................................................[15.350], [15.370]
Halpin v Lumley General Insurance Ltd (2009) 78 NSWLR 265; [2009] NSWCA 372 ............... [2.230]
Hans Pet Constructions Pty Ltd v Cassar [2009] NSWCA 230 ..................... [2.220], [10.40], [15.375]
Harold v Smith [1860] EngR 516; (1860) 5 H & N 381 .......................................................... [3.110]
Harris v Bellemore [2009] NSWSC 1497 ............................................................................... [13.340]
Hartford Holdings Pty Ltd v CP (Adelaide) Pty Ltd [2004] SASC 161 ....................................... [3.380]
Hart Security Australia Pty Ltd v Boucousis (No 2) [2014] NSWSC 1815 ................................ [15.255]
Hassid v Queensland Bulk Water Supply Authority t/​as Seqwater (No 2) [2017]
NSWSC 1064 ..................................................................................................................... [8.475]
Hastie Group Ltd (in liq) v Moore [2016] NSWCA 305 .......................................................... [14.165]
Hatfield v TCN Channel Nine Pty Ltd (2010) 77 NSWLR 506; [2010] NSWCA 69 ................... [12.90]
Heath v Greenacre Business Park Pty Ltd [2016] NSWCA 34 ................................................... [3.400]
Hearne v Street (2008) 235 CLR 125 .....................................................................[12.490], [12.500]
Heart Research Institute Ltd v Psiron Ltd [2002] NSWSC 646 .................................................. [5.280]
Hertsmere Primary Care Trust v Administrators of Balasubramanium’s Estate
[2005] 3 All ER 274 .......................................................................................................... [14.230]
Higgins v Higgins [2002] NSWSC 455 .................................................................................... [4.290]
High Court in Agar v Hyde (2000) 201 CLR 552 ................................................................... [11.420]
Hill v Reglon Pty Ltd [2007] NSWCA 295 .............................................................................. [10.100]
Hill v W & F Lechner Pty Ltd [2006] NSWSC 440 .................................................................... [2.310]
Hillier v Sheather (1995) 36 NSWLR 414 ............................................................................... [15.230]
Hobbs Anderson Investments Pty Ltd v Oz Minerals Ltd [2011] FCA 801 ................................ [8.715]
Hogan v Hinch (2011) 243 CLR 506; [2011] HCA 4 ................................................................ [1.180]
Hollier v Australian Maritime Safety Authority [No 2] [1998] FCA 975 ..................................... [3.110]
Hooper Bailie Associated Ltd v Natcan Group Pty Ltd (1992) 28 NSWLR 194 .......................... [4.340]
House v The King (1936) 55 CLR 499 ................................................................................... [15.375]
Howard v Telstra Corp Ltd [2003] NSWCA 188 ......................................................................... [5.30]
Hudson v Howes [2010] NSWSC 1503 ................................................................................. [13.550]
Hudson, Re; Ex parte G E Crane & Sons Ltd (1990) 25 FCR 318 ........................................... [11.120]
Hughes Aircraft Systems International v AirServices Australia (1997) 76 FCR 151 .................... [1.380]
Hunter v Hanson [2014] NSWCA 263 ..................................................................................... [11.70]
I
ICAP Australia Pty Ltd v BGC Partners (Australia) Pty Ltd [2009] NSWCA 307 ........................ [12.400]
ISTIL Group Inc v Zahoor [2003] 2 All ER 252 ....................................................................... [14.218]
Idoport Pty Ltd v National Australia Bank Ltd [2001] NSWSC 427 ........................................... [4.270]
Idoport Pty Ltd v National Australia Bank Ltd [2001] NSWSC 744 ........................................... [3.440]
Investmentsource v Knox Street Apartments [2007] NSWSC 1128 ........................................ [13.380]
Irish Bank Resolution Corporation Ltd v Quinn [2015] IEHC 175 ........................................... [12.357]
Irish Shipping Ltd v Commercial Union Assurance Co Plc [1991] 2 QB 206 ............................... [8.80]
J
J P Morgan Trust Australia Ltd v Kapetanovic [2007] NSWSC 1423 ....................................... [12.450]
Jabulani Pty Ltd v Walkabout II Pty Ltd [2016] NSWCA 267 .................................................... [5.255]
Jackamara v Krakouer (1998) 195 CLR 516 ............................................................................... [2.30]
Jackson v Sterling Industries Ltd (1987) 162 CLR 612 ................................................[6.170], [6.180]
Jacobsen v Rogers (1995) 182 CLR 572 ................................................................................ [14.280]
Jago v District Court of New South Wales (1989) 168 CLR 23 ......................................[1.40], [1.320]
xviii
Table of Cases
Jameel (Yousef) v Dow Jones & Co Inc [2005] EWCA Civ 75; [2005] QB 946 ........................ [14.230]
Jameson v Professional Investment Services Pty Ltd [2009] NSWCA 28 ........ [8.680], [8.690], [8.700]
Jamieson v King (1993) 177 CLR 574; [1993] HCA 48 ............................................................ [9.240]
Jarra Creek Central Packing Shed Pty Ltd v Amcor Ltd [2011] FCA 671 ................................... [8.784]
Jeffery & Katauskas Pty Ltd v SST Consulting Pty Ltd (2009) 239 CLR 75;
[2009] HCA 43 ................................................................................. [8.1010], [8.1040], [15.100]
Jeray v Blue Mountains City Council [2010] NSWCA 281 ...................................................... [15.285]
John Fairfax & Sons Pty Ltd v Police Tribunal (NSW) (1986) 5 NSWLR 465 ..................[1.60], [1.170]
John Fairfax Group Pty Ltd v Local Court of New South Wales (1991) 26 NSWLR 131 ............. [1.60],
[1.170], [1.200]
John Fairfax Publications Pty Ltd v District Court of NSW (2004) 61 NSWLR 344;
[2004] NSWCA 324 ..............................................................................................[1.150], [1.200]
John Fairfax Publications Pty Ltd v Ryde Local Court (2005) 62 NSWLR 512 ........................... [1.170]
John Holland Pty Ltd v Kellogg Brown & Root Pty Ltd [2015] NSWSC 451 ............................... [5.80]
John Pfeiffer Pty Ltd v Rogerson [2000] HCA 36; (2000) 203 CLR 503 ............... [1.20], [6.85], [6.90]
Johnston v Endeavour Energy [2015] NSWSC 1117 ...................................................[8.285], [8.920]
Johnston v Endeavour Energy [2016] NSWSC 1132 ................................................................ [8.780]
Jones v Bradley (No 2) [2003] NSWCA 258 ........................................................................... [15.268]
Judd v Warwick [2007] NSWDC 299 ..................................................................................... [10.180]
K
Kasupene v Ajax Foundry Pty Ltd [2006] NSWCA 309 ............................................................ [9.210]
Katsilis v Broken Hill Pty Ltd (1978) 52 ALJR 189 ..................................................................... [9.260]
Keating v South East Sydney Illawarra Area Health Service (unreported, Supreme
Court (NSW), 7 July 2006) ............................................................................................... [12.480]
Kebaro Pty Ltd v Saunders [2003] FCAFC 5 ............................................................................. [3.400]
Kelly v Mina [2014] NSWCA 9 ................................................................................................ [10.70]
Kirby v Sanderson Motors Pty Ltd [2002] NSWCA 44; (2002) 54 NSWLR 135 ......................... [9.180]
Knight v FP Special Assets Ltd [1992] HCA 28; 174 CLR 178; 66 ALJR 560 .................[3.390], [3.400]
Koompahtoo Local Aboriginal Land Council v KLALC Property & Investments Pty Ltd
(No 2) [2006] NSWSC 169 ................................................................................................ [2.310]
Kosciusko Thredbo Pty Ltd v State of New South Wales [2002] NSWSC 96 ............................. [7.460]
Kostas v HIA Insurance Services Pty Ltd [2010] HCA 32 ......................................................... [15.300]
L
LRSM Enterprise Pty Ltd v Zurich Australian Insurance Limited
[2014] NSWCA 88 ............................................................................................................. [3.410]
Lacey v Attorney-​General of Queensland [2011] HCA 10 ...................................................... [15.285]
Lam v Rolls Royce Plc [2013] NSWSC 805 ............................................................................... [8.650]
Lambert v Dean (1989) 97 FLR 352 .......................................................................................... [6.50]
Lane v Registrar of the Supreme Court [1981] HCA 35; (1981) 148 CLR 245 ........................ [12.145]
Lang v Australian Coastal Shipping Commission [1974] 2 NSWLR 70 ................................... [12.460]
Larkden Pty Ltd v Lloyd Energy Systems Pty Ltd [2011] NSWSC 1331 ..................................... [5.160]
Larkden Pty Ltd v Lloyd Energy Systems Pty Ltd [2011] NSWSC 268 ....................................... [5.100]
Latoudis v Casey [1990] HCA 59; (1990) 170 CLR 534 ..............................................[3.110], [3.190]
Laurie v Carroll (1958) 98 CLR 310; [1958] HCA 4 ...................................................[11.70], [11.220]
Lawindi; Re Elkateb v Elkateb (2001) 187 ALR 479; [2001] FCA 1527 ................................... [11.120]
Leach v The Nominal Defendant [2014] NSWCA 391 ............................................[15.230], [15.250]
Legal & General Life of Australia Ltd v A Hudson Pty Ltd (1985) 1 NSWLR 314 ....................... [5.340]
Leichardt Municipal Council v Green [2004] NSWCA 341 ..................................................... [15.268]
Leighton International v Hodges [2012] NSWSC 458 ............................................................ [12.240]
Lipman Pty Ltd v Emergency Services Superannuation Board [2011] NSWCA 163 .................. [4.340]
Lipton v King [2010] NSWCCA 175 ...................................................................................... [12.400]
xix
Civil Procedure in New South Wales
Liristis v Gadelrabb [2009] NSWSC 441 ................................................................................ [12.430]
London Scottish Benefit Society v Chorley (1884) 13 QBD 872 .............................................. [3.380]
Lowery v Insurance Australia Ltd [2015] NSWCA 303 ........................................................... [12.445]
Lowe v Mack Trucks Australia Pty Ltd [2001] FCA 388 ............................................................ [8.890]
Lucas v Yorke (1983) 50 ALR 228 ............................................................................................ [3.450]
M
MZARS v Minister for Immigration and Border Protection [2017] FCA 177 ............................. [3.110]
MacDougall v Curleveski (1996) 40 NSWLR 430 ....................................................................... [5.30]
Macatangay v New South Wales (No 2) [2009] NSWCA 272 ................................................ [15.350]
Mainteck Services Pty Ltd v Stein Heurtey SA (2014) 89 NSWLR 633; [2014] NSWCA 184 ...... [5.255]
Maitland Hospital v Fisher [No 2] (1992) 27 NSWLR 721 ...................................................... [15.230]
Mann v Carnell (1999) 201 CLR 1 ........................................................... [14.90], [14.170], [14.190]
Marango Investments Pty Ltd v Kingdom Towers 4 Pty Ltd [2019] NSWSC 801 ...................... [6.186]
Mareva Compania Naviera SA v International Bulkcarriers SA [1975] 2 Lloyd’s Rep 509 ........... [6.170
Markisic v Department of Community Services of New South Wales (No 2)
[2006] NSWCA 321 ..............................................................................................[9.190], [9.400]
Markt & Co Ltd v Knight Steamship Co Ltd [1910] 2 KB 1021 .................................................. [8.80]
Martin v Martin & Co [1897] 1 QB 49 .................................................................................... [7.450]
Mastronardi v New South Wales [2007] NSWCA 54 ...................................................[1.360], [1.370]
Matthews v AusNet Electricity Services Pty Ltd [2014] VSC 663 .............................................. [8.715]
Matthews v SPI Electricity Pty Ltd (Ruling No 2) [2011] VSC 168 ............................................ [8.850]
May v Christodoulou [2011] NSWCA 75; 80 NSWLR 462 ....................................................... [3.400]
McConnell Dowell Constructors v Santam (2016) 51 VR 421 .................................[12.357], [12.358]
McGuire v Secretary for Justice [2018] NZSC 116 ................................................................... [3.380]
McGuirk v University of New South Wales [2010] NSWCA 104 ............................................... [2.240]
McIlraith v Ilkin (Costs) [2007] NSWSC 1052 .......................................................................... [3.380]
McKain v RW Miller & Co (SA) Pty Ltd (1991) 174 CLR 1 .......................................................... [1.20]
McPherson v McPherson [1936] AC 417 ................................................................................. [1.200]
Melbourne Steamship Co v Moorehead (1912) 15 CLR 333 ................................................... [1.380]
Mempoll Pty Limited, Anakin Pty Ltd and Gold Kings (Australia) Pty Ltd, Re
[2012] NSWSC 1057 ....................................................................................................... [12.270]
Meriton Apartments Pty Limited v Industrial Court of New South Wales (2009) 263
ALR 556; [2009] NSWCA 434 ............................................................................................ [7.130]
Merribee Pastoral Industries Pty Ltd v Australia & New Zealand Banking Group Ltd
[1998] HCA 41; 193 CLR 502 ............................................................................................ [3.450]
Metropolitan Petar v Mitreski [2008] NSWSC 293 .................................................................. [2.160]
Micallef v ICI Australia Operations Pty Ltd [2001] NSWCA 274 ............................................. [15.375]
Midgley v Midgley [1893] 3 Ch 282 ....................................................................................... [3.380]
Mirror Newspapers Ltd v Waller (1985) 1 NSWLR 1 ................................................................ [1.200]
Mitsubishi Electric Australia Pty Ltd v Victorian Workcover Authority (2002) 4 VR 332 ........... [14.120]
Miwa Pty Ltd v Siantan Properties Pte Ltd (No 2) [2011] NSWCA 344 .................................. [15.268]
Mohareb v Palmer [2016] NSWCA 378 ................................................................................. [15.268]
Mondial Trading Pty Ltd v Interocean Marine Transport Inc (1985) 60 ALJR 277;
65 ALR 155 ...................................................................................................................... [11.150]
Morgan v Johnson (1998) 44 NSWLR 578 .................................................................[5.30], [15.230]
Morris v Hanley [2000] NSWSC 957 ....................................................................................... [3.410]
“Mr C” (1993) 67 A Crim R 562 ................................................................................[1.180], [1.200]
Multiplex Funds Management Ltd v P Dawson Nominees Pty Ltd (2007) 164 FCR
275; [2007] FCAFC 200 ............................................................. [8.440], [8.450], [8.640], [8.650]
Mummery v Irvings Pty Ltd (1956) 96 CLR 99; [1956] HCA 45 ............................................... [9.260]
Munkarra v Fischer (1980) 5 NTR 3 ...................................................................................... [11.190]
Murphy v Legal Services Commissioner [No 2] [2013] QSC 253 ............................................. [3.380]
Murphy v Young & Co Brewery [1997] 1 WLR 1591 ............................................................... [3.390]
xx
Table of Cases
N
NSW Commissioner of Police v Tuxford [2002] NSWCA 139 ..................................[12.390], [12.410]
Nadarajapillai v Naderasa (No 2) [2015] NSWCA 209 ............................................................. [3.250]
Naken v General Motors of Canada Ltd (1983) 144 DLR (3d) 385 .......................................... [8.130]
Nash v Stewart [2010] NSWSC 513 ...................................................................................... [11.260]
National Crime Authority v Gould (1989) 90 ALR 489 .......................................................... [14.290]
Nationwide News Pty Ltd v Naidu; ISS Security Pty Ltd v Naidu (No 2) [2008] NSWCA 71 ..... [3.330]
New Idafe Inc v Barnard [2007] NSWSC 1107 ...........................................................[4.270], [7.350]
New South Wales v Gillett [2012] NSWCA 83 ......................................................................... [6.135]
New South Wales v Mulcahy [2006] NSWCA 303 ................................................................... [10.40]
New South Wales v Public Transport Ticketing Corporation [2011] NSWCA 60 .........[14.40], [14.70],
[14.85], [14.290], [14.300], [14.320]
New South Wales v Public Transport Ticketing Corporation (No 3) [2011] NSWCA 200 ........ [14.340]
New South Wales v Williams [2014] NSWCA 177 ...................................... [9.380], [9.440], [15.140]
New South Wales Commissioner of Police v Nationwide News Pty Ltd
(2007) 70 NSWLR 643 ..................................................................................................... [14.300]
News Ltd v Australian Rugby Football League Ltd (1996) 139 ALR 193 ................................... [7.370]
Norbis v Norbis [1986] HCA 17; (1986) 161 CLR 513 ............................................................. [3.110]
Norris v Kandiah [2007] NSWSC 1296 .................................................................................. [12.145]
Northbuild Constructions Pty Ltd v Discovery Beach Project Pty Ltd [2008] QCA 160 ............. [5.340]
Northern Territory v Sangare [2019] HCA 25 .............................................................[3.100], [3.110]
Norwich Pharmacal Co v Commissioners of Customs and Excise [1974] AC 133] ................... [12.70]
Nowlan v Marson Transport Pty Ltd (2001) 53 NSWLR 116 .................................................... [1.130]
O
O’Brien v Little; Walsh v Little [2007] NSWSC 64 .................................................................. [12.460]
O’Shane v Harbour Radio Pty Ltd [2014] NSWSC 93 ............................................................ [12.440]
O’Sullivan v Challenger Managed Investments Limited [2007] NSWSC 383 ............................ [8.150]
Oasis Fund Management v ABN Amro [2009] NSWSC 967 ..................................................... [4.310]
Oasis Fund Management Ltd v Royal Bank of Scotland Nv [2010] NSWSC 584 ............[8.80], [8.470]
Ohn Fairfax Publications Pty Ltd v District Court of NSW (2004) 61 NSWLR 344 .................... [1.200]
Old v McInnes [2011] NSWCA 410 .......................................................................[15.230], [15.268]
Oshlack v Richmond River Council (1998) 193 CLR 72; 72 ALJR 578; 152 ALR 83;
[1998] HCA 11 ........................................................................ [3.110], [3.200], [3.450], [15.268]
Owners Corporation -​Strata Plan 61732 v TR Druce Pty Ltd [2009] NSWSC 1024 .................... [3.57]
P
P Dawson Nominees Pty Ltd v Brookfield Multiplex Ltd (No 4) [2010] FCA 1029 .................... [8.730]
PGA v The Queen (2012) 245 CLR 355; [2012] HCA 21 ....................................................... [14.218]
PT Bayan Resources TBK v BCBC Singapore Pte Ltd [2015] HCA 36 ........................................ [6.170]
Pacific Steel Constructions Pty Ltd v Barahona [2009] NSWCA 406 ....................................... [13.620]
Palacath Ltd v Flanagan [1985] 2 All ER 161 ........................................................................... [5.340]
Palavi v Radio 2UE Sydney Pty Ltd [2011] NSWCA 264 ......................................................... [12.220]
Palmer v Walesby (1868) LR 3 Ch App 732 ............................................................................. [3.390]
Pascoe v Divisional Security Group Pty Ltd (2007) 209 FLR 197; [2007] NSWSC 211 .............. [9.250]
Patonga Beach Holdings Pty Ltd v Lyons [2009] NSWSC 869 ................................................ [12.145]
Payne v Young (1980) 145 CLR 609 ..........................................................................[7.180], [7.250]
Pelechowski v Registrar, Court of Appeal (1999) 198 CLR 435 .......................................[1.60], [1.70]
Pennington v Russell [No 2] [1883] NSWLawRp 47; (1883) 4 LR (NSW) Eq 41 ....................... [3.380]
Penrith Rugby League Club Limited v Brown [2004] NSWSC 1182 ....................................... [12.145]
Pentelow v Bell Lawyers Pty Ltd [2018] NSWCA 150 ............................................................... [3.380]
Percy v General Motors Holden Pty Ltd [1975] 1 NSWLR 289 ................................[12.150], [12.230]
xxi
Civil Procedure in New South Wales
Petrusevski v Bulldogs Rugby League Club Ltd [2003] FCA 61 ................................................ [8.380]
Pharm-​a-​Care Laboratories Pty Ltd v Commonwealth of Australia [2011] FCA 1111 ................ [8.784]
Philip Morris (Australia) Ltd v Nixon (2000) 170 ALR 487; [2000] FCA 229 ............................ [8.250],
[8.290], [8.300]
Philips Electronics Australia Pty Ltd v Matthews (2002) 54 NSWLR 598 ................................... [3.480]
Pinebelt Pty Ltd v Bagley [2000] NSWSC 655 ......................................................................... [3.220]
Police New South Wales, Commissioner of v Nationwide News Pty Ltd
(2007) 70 NSWLR 643 ..................................................................................................... [14.300]
Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 ......................................... [7.90]
Premier Travel v Satellite Centres of Australia [2004] NSWSC 864 ..........................[12.490], [12.510]
Preston v Nikolaidis [2010] NSWSC 427 ............................................................................... [10.170]
Priest v New South Wales [2006] NSWSC 12 ...........................................................[9.410], [12.340]
Priest v New South Wales [2007] NSWSC 41 ...........................................................[3.140], [12.350]
Principal Registrar of the Supreme Court v Tastan (1994) 75 A Crim R 498 ........................... [12.400]
Proctor v Jetway Aviation Pty Ltd [1984] 1 NSWLR 166 ......................................................... [10.130]
Prudential Assurance Co Ltd v Newman Industries Ltd [1981] Ch 229 ...................................... [8.80]
Pyrrho Investments Ltd v MWB Property Ltd [2016] EWHC 256 (Ch) .................................... [12.357]
Q
Qantas Airways Ltd v A F Little Pty Ltd [1981] 2 NSWLR 34 .................................................... [7.390]
Quach v Mustafa (unreported, NSWCA, 15 June 1995) ............................................................ [5.30]
R
R v Bell; Ex parte Lees (1980) 146 CLR 141 ........................................................................... [14.170]
R v CAL (1993) 67 A Crim R 562 ............................................................................................. [1.200]
R v Derby Magistrates’ Court; Ex parte B [1996] AC 487 ....................................................... [14.218]
R v Hawi (No 2) [2011] NSWSC 1648 ..................................................................................... [14.40]
R v Kwok (2005) 64 NSWLR 335 ............................................................................................. [1.180]
R v Macfarlane; Ex parte O’Flanagan (1923) 32 CLR 518 ........................................................ [1.320]
R v Meissner (1994) 76 A Crim R 84 ..................................................................................... [14.290]
R v Mosely (1992) 28 NSWLR 735 ............................................................................................ [1.60]
R v Richards & Bijkerk (1999) 107 A Crim R 318 ..................................................................... [1.150]
R v Saleam (1989) 16 A Crim R 14 ........................................................................................ [12.400]
R v Saleam [1999] NSWCCA 86 ............................................................................................ [12.400]
R v Savvas (1989) 43 A Crim R 331 ......................................................................................... [1.200]
R v Socialist Worker Printers & Publishers Ltd; Ex Parte Attorney-​General [1975] QB 637 ........ [1.200]
R v Tait (1979) 46 FLR 386 ...................................................................................................... [1.200]
R v Yooyen, Tait & Poompiriyapinte (1991) 57 A Crim R 226 ................................................ [14.290]
R (Morgan Grenfell & Co Ltd) v Special Commissioner of Income Tax [2003] 1 AC 563 ........ [14.218]
Rajski v Computer Manufacture & Design Pty Ltd [1982] 2 NSWLR 443 ..................... [3.410, [3.480]
Raybos Australia Pty Ltd v Jones (1985) 2 NSWLR 47 .............................................................. [1.200]
Rayscan Management Pty Ltd v Siv Nandan Moodliar [2008] NSWSC 857 ............................. [10.60]
Redden v Chapman [1949] NSWStRp 28; (1949) 50 SR (NSW) 24 ......................................... [3.110]
Redowood Pty Ltd v Link Market Services Pty Ltd (formerly known as ASX Perpetual
Registrars Ltd) [2007] NSWCA 286 .................................................................................... [7.140]
Regency Media Pty Ltd v AAV Australia Pty Ltd [2009] NSWCA 368 ...................................... [15.230]
Regent Holdings Pty Ltd v State of Victoria (2012) 36 VR 424 ................................................. [8.715]
Reinehr Industrial Lease & Finance Pty Ltd v Jordan ............................................................... [15.60]
Remuneration Planning Corporation Pty Limited v Fitton [2001] NSWSC 1208 ...................... [4.260]
Richards v Cornford (No 3) [2010] NSWCA 134 ..................................................................... [15.60]
Richmond Valley Council v Jardine Lloyd Thompson Pty Ltd [2019] NSWSC 126 .................... [8.590]
Rinehart v Hancock Prospecting Pty Ltd [2019] HCA 13 ............................................................ [5.85]
Rinehart v Nine Entertainment Co Holdings Ltd [2015] NSWSC 239 ..................................... [12.100]
xxii
Table of Cases
Rinehart v Welker [2011] NSWCA 403 .................................................................................... [1.290]
Rinehart v Welker (2012) 95 NSWLR 221 .................................................................................. [5.85]
Rio Tinto v Vale [2015 WL 872294 (SDNY), 14 Civ 3042 (RMP)(AJP) (2 March 2015) ........... [12.357]
Rippon v Chilcotin (2001) 53 NSWLR 198; [2001] NSWCA 142 .................................[7.110], [7.120]
Ritter v Godfrey [1920] 2 KB 47 .................................................................................[3.110], [3.200]
Roads & Traffic Authority of NSW v Australian National Car Parks Pty Ltd (2007) 47
MVR 502; [2007] NSWCA 114 ........................................................................................... [12.70]
Roads & Traffic Authority of New South Wales v Care Park Pty Limited
[2012] NSWCA 35 ............................................................................................................. [12.80]
Rodriguez & Sons Pty Ltd v Queensland Bulk Water Supply Authority
[2014] NSWSC 1565 ............................................................................................[8.392], [8.630]
Rowlands v State of NSW [2009] NSWCA 136 ...................................................................... [13.690]
Roxborough v Rothmans of Pall Mall (2001) 208 CLR 516 .................................................... [8.1040]
Rozenbilt v Vainer (2018) 262 CLR 478; [2018] HCA 23 ......................................................... [2.258]
Russell v Russell (1976) 134 CLR 495 ...................................................................................... [1.200]
Ryan v Watkins [2005] NSWCA 426 ...................................................................................... [14.300]
S
S v State of New South Wales (No 3) [2009] NSWCA 248 .................................................... [14.300]
Salzke v Khoury (2009) 74 NSWLR 580; [2009] NSWCA 195 ................................................ [13.400]
Samsung Electronics Co Ltd v Apple Inc [2011] FCAFC 156 .................................................... [6.163]
Sanderson v Blyth Theatre Co [1903] 2 KB 533 ....................................................................... [3.320]
Sankey v Whitlam (1978) 142 CLR 1 ......................................................................[14.280], [14.300]
Scott v Scott [1913] AC 417 ................................................................................................... [1.170]
Scott v Secretary, Department of Social Security [No 2] [2000] FCA 1450 ............................... [3.110]
Scottish Gympie Gold Mines Ltd v Carroll [1902] St R Qd 311 ................................................ [3.110]
Sedrak v Starr [2009] NSWSC 996 .......................................................................................... [2.310]
Selliah v Minister for Immigration and Multicultural Affairs [1998] FCA 469 ............................ [3.110]
Seven Network (Operations) Ltd v Warburton (No 1) [2011] NSWSC 385 .............................. [1.230]
Shaw v Gadens Lawyers; Shaw v Rigby Cooke Lawyers [2014] VSCA 74 ................................. [7.160]
Shaw v New South Wales (2012) 219 IR 87; [2012] NSWCA 102 ...............................[9.380], [9.430]
Sheahan v Slattery (No 2) [2006] NSWSC 711 ........................................................................ [2.310]
Shoalhaven City Council v Firedam Civil Engineering Pty Ltd (2011) 244 CLR 305 .................. [5.320]
Singapore Airlines Cargo Pte Limited v Principle International Pty Ltd (No 2)
[2017] NSWCA 340 ......................................................................................................... [15.268]
Silverside Superfunds Pty Ltd v Silverstate Developments Pty Ltd [2008] NSWSC 904 ............. [9.420]
Singh v De Castro [2017] NSWCA 130 ................................................................................... [3.410]
Singh v Singh [2002] NSWSC 852 .......................................................................................... [4.270]
Singtel Optus Pty Limited v Weston [2011] NSWSC 1083 ....................................................... [14.40]
Siskina v Distos Compania Naviera SA [1979] AC 210 ........................................................... [11.220]
Skalkos v T & S Recoveries Pty Ltd (2004) 65 NSWLR 151; [2004] NSWCA 281 ........................ [3.20]
Smeaton Hanscomb & Co Ltd v Sassoon I Setty, Son & Co [No 2] [1953] 1 WLR
1481; [1953] 2 All ER 1588 ................................................................................................ [3.110]
Smith v Australian Executor Trustees Limited; Creighton v Australian Executor
Trustees Limited (No 4) [2018] NSWSC 1584 .................................................................... [8.782]
Sneddon v State of New South Wales [2012] NSWCA 351 ...................................................... [7.160]
Southland Coal Pty Ltd (recs and mgrs apptd) (in liq), Re (2006) 203 FLR 1 ......................... [14.160]
Spain v Union Steamship Co of New Zealand Ltd (1923) 32 CLR 138 ..................................... [15.30]
Spencer v NSW Minister for Climate Change and the Environment [2010] NSWCA 75 ......... [10.220]
Spencer v The Commonwealth [2010] HCA 28 .................................................................... [15.140]
Stanton v Abernathy (1990) 19 NSWLR 656 ............................................................................. [1.60]
State Central Authority & Blyth [2010] FamCA 90 ................................................................ [14.170]
Stead v State Government Insurance Commission (1986) 161 CLR 141;
[1986] HCA 54 ....................................................................................... [1.340], [1.350], [1.360]
xxiii
Civil Procedure in New South Wales
Stewart v Moore [1921] St R Qd 182 ...................................................................................... [3.110]
Stollznow v Calvert [1980] 2 NSWLR 749 ............................................................................. [15.170]
Street v Luna Park Sydney Pty Ltd [2006] NSWSC 95 ............................................................ [12.380]
Strike Australia Pty Ltd v Data Base Corporate Pty Ltd [2019] NSWCA 205 ................[5.330], [5.340]
Subway Systems Australia Pty Ltd v Ireland [2014] VSCA 142 ................................................... [5.70]
Suncorp Insurance and Finance, Re [1991] 2 Qd R 704 ............................................................. [7.30]
Survival & Industrial Equipment (Newcastle) Pty Ltd v Owners of the Vessel “Alley
Cat” (1992) 36 FCR 129 .................................................................................................... [12.30]
Sydney Airports Corporation Ltd v Singapore Airlines Ltd & Qantas Airways Ltd
[2005] NSWCA 47 ........................................................................................................... [14.120]
Sydney City Council v Geftlick [2006] NSWCA 280 ................................................................... [5.30]
Symington v Hoechst Schering Agrevo Pty Ltd (1997) 78 FCR 164 ......................................... [8.290]
T
TCL Air Conditioner (Zhongshan) Co Ltd v Castel Electronics Pty Ltd [2014] FCAFC 83 .......... [5.130]
TKWJ v The Queen (2002) 212 CLR 124; [2002] HCA 46 .......................................................... [1.60]
TW McConnell Pty Ltd as trustee for the McConnell Superannuation Fund v
SurfStitch Group Ltd (subject to deed of company arrangement) (No 3)
[2018] NSWSC 1749 ......................................................................................................... [8.713]
Tabet v Mansour [2005] NSWSC 908 ................................................................................... [13.560]
Taff Vale Railway Co v Amalgamated Society of Railway Servants [1901] AC 426 ...................... [8.80]
Taxation, Federal Commissioner of v Spotless (1996) 186 CLR 404 ....................................... [14.120]
Templeton v Leviathan Pty Ltd (1921) 30 CLR 34 ................................................................... [8.470]
Thai Airways International Public Co Ltd v FaragMenzies Aviation Group (Ground
Services) Australia Pty Ltd [2011] NSWCA 172 ................................................................. [15.210]
Three Rivers District Council v Governor and Company of the Bank of England [No 6]
[2005] 1 AC 610 .............................................................................................................. [14.218]
Timbercorp Finance Pty Ltd (in liq) v Collins (2016) 259 CLR 212;
[2016] HCA 44 .....................................................................................................[7.165], [8.873]
Timbercorp Finance Pty Ltd (in liq) v Tomes [2016] HCA 44 ................................................... [7.165]
Tomlinson v Ramsey Food Processing Pty Ltd [2015] HCA 28 ................................................... [7.70]
Tonab Investments Pty Ltd v Optima Developments Pty Ltd [2015] NSWCA 205 .................... [3.410]
Tongue v Council of the City of Tamworth [2004] FCA 1702 .................................................. [8.720]
Tony Hassan Noun v Margaret Pavey [2014] NSWSC 429 ....................................................... [4.320]
Tozier v Hawkins (1885) 15 QBD 680 ..................................................................................... [3.110]
Trade Practices Commission v Arnotts Limited (No 2) (1989) 21 FCR 306 ............................. [12.390]
Treadwell v Hickey [2010] NSWSC 1119 ................................................................................. [3.270]
Treloar Constructions Pty Ltd v McMillan (No 2) [2017] NSWCA 146 ................................... [15.268]
Tripple Take Pty Ltd v Clark Rubber Franchising Pty Ltd; Brooks v Clark Rubber
Franchising Pty Ltd [2005] NSWSC 1169 ........................................................................... [2.170]
Tropical Shine Holdings Pty Limited v Lake Gesture Pty Limited (1993) 45 FCR 457 ................ [8.290]
Truth About Motorways v Macquarie (2000) 200 CLR 591; 169 ALR 616; 74 ALJR
604; [2000] HCA 11 ............................................................................................................ [7.40]
Truthful Endeavour Pty Ltd v Condon (Trustee) Re Rayhill (Bankrupt)
[2015] FCAFC 70 ............................................................................................................... [7.160]
Tugrul v Tarrants Financial Consultants Pty Ltd [No 5] [2014] NSWSC 437 ............................. [2.260]
Turnbull v New South Wales Medical Board [1976] 2 NSWLR 281 ........................................ [15.290]
U
UBS AG v Tyne [2018] HCA 45 ............................................................................................... [2.258]
United Group Rail Services Ltd v Rail Corporation NSW [2009] NSWCA 177 ........................... [4.350]
xxiv
Table of Cases
V
Van Der Lee v State of NSW [2002] NSWCA 286 .................................................................. [15.120]
Vanacom Pty Ltd v Morgan Brooks Pty Ltd [2006] NSWSC 46 .............................................. [12.460]
Violi v Commonwealth Bank of Australia [2015] NSWCA 152 ............................................... [11.190]
Vlasic v Federal Capital Press of Australia Pty Ltd (1976) 9 ACTR 1 .......................................... [9.340]
W
WMC Resources Ltd v Leighton Contractors Pty Ltd (1999) 20 WAR 489 ................................ [5.310]
Waind v Hill & National Employers Mutual General Association Ltd [1978]
1 NSWLR 372 .....................................................................................................[12.380], [14.40]
Wainohu v New South Wales (2011) 243 CLR 181; (2011) 278 ALR 1;
[2011] HCA 24 .....................................................................................................[1.300], [1.310]
Wakim, Re; Ex parte McNally (1999) 198 CLR 511 .................................................................... [6.30]
Walker v Commonwealth Trading Bank of Australia (1985) 3 NSWLR 496 ............................... [7.390]
Wang v Farkas (No 6) [2015] NSWCA 116 .............................................................................. [3.410]
Waterford v The Commonwealth (1987) 163 CLR 54 ........................................................... [14.218]
Waterhouse v Perkins [2001] NSWSC 13 ....................................................................[4.270], [4.300]
Waugh Asset Management v Merrill Lynch [2010] NSWSC 197 ................. [14.40], [14.80], [14.210]
Weber v Ankin [2007] NSWSC 263 ......................................................................................... [7.380]
Wee Shuo Woon v HT SRL [2017] 2 SLR 94 .......................................................................... [14.218]
Weldon v Neal (1887) 19 QBD 394 ...................................................................................... [10.130]
Welzel v Francis [2011] NSWSC 477 ..........................................................................[3.480], [3.490]
Wentworth v Wentworth (2001) 179 ALR 406; [2001] NSWCA 350 ....................................... [3.390]
Wepar Nominees Pty Ltd v Schofield (No 2) [2014] FCA 225 .................................................. [8.715]
WesTrac Pty Ltd v Eastcoast OTR Tyres Pty Ltd [2008] NSWSC 894 ........................................... [5.30]
Western Export Services Inc v Jireh International Pty Limited [2008] NSWSC 601 .................. [13.440]
Westpac Banking Corp v Thurairajah [2009] NSWSC 442 ..................................................... [11.150]
Westport Insurance Corp v Gordian Runoff Ltd (2011) 244 CLR 239; [2011] HCA 37 ............. [5.120]
Whitney v Dream Developments Pty Ltd [2013] NSWCA 188 ................ [15.230], [15.265], [15.268]
Winn v Garland Hawthorn Brahe (Ruling No 1) [2007] VSC 360 ............................................. [3.380]
Witness v Marsden (2000) 49 NSWLR 429 .................................................................[1.200], [1.210]
Wollongong City Council v Legal Business Centre Pty Limited [2012] NSWCA 245 ................. [3.420]
Wong v Silkfield Pty Ltd (1999) 199 CLR 255; [1999] HCA 48 ...................................[8.130], [8.370]
Workplace Safety Australia Pty Ltd v Simple OHS Solutions Pty Ltd [2014] NSWCA 55 ............ [3.410]
Wright Rubber Products Pty Ltd v Bayer AG [2010] FCAFC 85 ................................................ [8.390]
X
“X” v Sydney Children’s Hospitals Specialty Network [2011] NSWSC 1272 ............................ [1.295]
Y
Yi Cheng Jiang v Wan Ze Property Development (Aust) Pty Ltd (in liq) [2014] NSWCA 350 ....... [3.410]
Ying v Song [2010] NSWSC 1500 ......................................................................................... [13.180]
Young v Hones [2014] NSWCA 337 .............................................................................[9.90], [9.115]
Young v Quin (1985) 4 FCR 483 .............................................................. [14.40], [14.290], [14.300]
Z
Zanella v Madden [2007] NSWSC 559 ...................................................................................... [3.70]
Zhang v Minister for Immigration, Local Government & Ethnic Affairs (1993) 45 FCR 384 ...... [8.350]
xxv
TABLE OF STATUTES
s 33C(1)(a): [8.300]
s 33D: [8.250]
s 33H: [8.270]
s 33H(1)(a): [8.390]
s 33H(2): [8.290]
s 33J: [8.440]
s 33L: [8.400]
s 33M: [8.150], [8.400]
s 33N: [8.150], [8.400], [8.450], [8.470]
s 33N(1): [8.440]
s 33N(1)(d): [8.450]
s 33Q: [8.530]
s 33R: [8.550]
s 33S: [8.560]
s 33T: [8.480]
s 33V: [8.770]
s 33X: [8.790]
s 33Y: [8.790]
s 33Z: [8.850]
s 33ZF: [8.910]
s 33ZG(c)(v): [8.1000], [8.1003]
s 33ZJ: [8.960]
s 37M: [2.80]
s 37N: [2.80]
s 43(1A): [8.940], [8.1000]
s 43(3)(f): [2.80]
s 157(1)(a): [8.300]
COMMONWEALTH
Australian Consumer Law
s 18: [7.80]
Australian Securities and Investments
Commission Act 2001: [7.165]
Australian Solicitors’ Conduct Rules
r 17.1: [3.380]
r 27.1: [3.380]
Commercial Arbitration Act 2010: [11.390]
Constitution: [1.610], [1.620]
Ch III: [1.610], [6.30]
s 71: [1.610]
s 73: [1.610]
s 75: [1.610]
s 76: [1.610]
s 77: [1.610]
Corporations Act 2001: [7.165], [9.20]
s 109X(1)(a): [11.130]
s 459G: [12.145]
s 1335: [3.410]
Crimes Act 1914
s 3ZQR: [14.90]
Evidence Act 1995: [14.20], [14.40]
s 128A: [6.210]
Federal Court of Australia Amendment Act
1991: [8.110]
Evidence Amendment Act 2008: [14.20]
Freedom of Information Act 1982: [12.10],
[12.70], [14.20]
Family Law Act 1975: [1.630]
International Arbitration Act 1974: [5.40],
[11.390]
Family Law Rules 2004
r 1.07: [2.80]
r 1.08: [2.80]
r 19.10: [2.80]
Judiciary Act 1903
s 34: [1.610]
s 35: [1.610]
s 35A: [1.610]
s 35AA: [1.610]
s 38: [1.610]
s 20: [11.330]
s 20(3): [11.320], [11.330]
s 20(4): [11.320]
s 20(5): [11.320]
Federal Court Rules
O 6, r 8: [7.360]
O 62A: [3.510]
Federal Court Rules 2011
O 8, r 3(2): [14.330]
r 9.05: [7.360]
r 10.43: [14.330]
Jurisdiction of Courts (Cross-​vesting) Act 1987:
[6.30], [11.300], [11.330], [11.390]
s 4: [6.30]
Federal Court of Australia Act 1976: [1.620],
[8.120], [8.150], [8.170], [8.250], [8.890],
[8.1000]
Pt IVA: [8.110], [8.340], [8.440], [8.650]
s 23: [6.163]
s 31A: [15.140]
s 33C: [8.150], [8.250]
Legal Profession Uniform Law Australian
Solicitors’ Conduct Rules 2015: [2.270]
Migration Act 1958: [3.110]
xxvii
Civil Procedure in New South Wales
National Security Information (Criminal and
Civil Proceedings) Act 2004: [14.300]
Service and Execution of Process Act: [11.220]
Service and Execution of Process Act 1992:
[11.220], [11.300]
Pt 2, Div 1: [11.310]
Pt 3: [11.310]
ss 13–​16: [11.300]
s 21: [11.320]
The Legal Profession Uniform Conduct
(Barristers) Rules 2015
r 23: [2.270]
r 42: [2.270]
r 43: [2.270]
Trade Practices Act 1974: [7.90], [7.165],
[14.330]
s 52: [6.180]
Trans-​Tasman Proceedings Act 2010
Pt 2, Div 2: [11.410]
Uniform Civil Procedure Rules 2005
Pt 21: [14.30]
Uniform Civil Procedure Rules (Amendment No
63) 2013
Pt 3: [2.310]
AUSTRALIAN CAPITAL TERRITORY
Evidence Act 2011: [14.20]
Human Rights Act 2004: [1.400]
s 21: [1.420]
s 28: [1.440]
s 30: [1.440]
s 32: [1.440]
NEW SOUTH WALES
Aboriginal Land Rights Act 1983
s 239A: [4.155]
Administrative Decisions Tribunal Act
1997 (NSW)
s 73(2), [14.370]
Arbitration (Civil Actions) Act 1983: [5.30]
Children and Young Persons (Care and
Protection) Act 1998
s 65: [4.155]
Civil Justice Review, Report (2008): [1.440]
Civil Liability Act 2002
s 5O: [12.480]
Civil Liability Amendment (Personal
Responsibility) Act 2002: [6.100]
Civil Procedure Act 2005: [1.30], [1.80],
[1.240], [1.470], [2.10], [2.130], [2.180],
[3.10], [3.20], [3.57], [3.500], [4.250],
[7.50], [8.200], [10.10], [10.180], [10.200],
[14.370], [15.60], [15.440]
Pt 4: [4.270]
Pt 5: [5.20]
Pt 6: [15.230]
Pt 10: [8.170], [8.650], [8.873]
s 3: [9.10]
s 3(1): [3.380]
s 8: [1.30], [2.330]
s 9: [1.30], [2.330]
ss 14–​16: [2.330]
s 14: [10.40], [10.50]
s 15: [2.280]
s 16: [10.40], [10.50]
s 21: [7.290], [7.300]
s 21(4): [7.300]
s 22: [7.290]
s 22(2): [7.310]
ss 25–​34: [4.280]
s 25: [4.270], [14.390]
s 26: [4.270]
s 27: [4.270]
ss 29–​31: [14.390]
s 29: [4.270]
s 29(2): [14.370]
s 30: [4.270], [14.370]
s 31: [4.270]
s 33: [4.270]
s 37: [5.30]
s 38: [5.30]
ss 42–​47: [5.30]
s 43: [5.30]
s 46: [5.30]
s 49: [5.30]
s 50: [5.30]
s 51: [5.30]
s 52: [5.30]
s 53: [5.30]
s 56: [1.80], [2.80], [2.150], [3.10], [3.57],
[3.130], [7.220], [7.400], [7.430],
[8.1050], [9.70], [9.340], [10.40],
[10.50], [10.240], [14.290], [15.30],
[15.160]
ss 56–​58: [3.57]
ss 56–​59: [3.20]
ss 56–​60: [2.140], [7.170], [15.160]
ss 56–​61: [10.50], [14.370]
s 56(1): [8.650], [10.240], [13.710], [14.370]
s 56(2), [14.370]
s 56(3): [2.130]
s 56(4): [1.80], [3.120]
s 57: [1.80], [2.130], [2.140], [7.220],
[7.430], [10.40], [10.50], [10.240],
[13.570], [15.10], [15.30]
s 58: [1.80], [2.130], [10.40]
s 58(1): [2.130]
s 58(1)(a)(ii): [10.240]
xxviii
Table of Statutes
Civil Procedure Act 2005 — cont
s 58(2): [2.170], [2.220], [2.230], [2.250],
[10.240], [14.215]
s 58(2)(a): [2.130]
s 58(2)(b): [1.80], [2.130]
s 59: [1.80], [2.130]
s 60: [1.80], [2.130], [3.20], [3.30],
[3.57], [3.60]
ss 61–​63: [2.190]
s 61: [10.40]
s 61(1): [12.240]
s 63: [10.180], [10.190], [10.200], [11.70],
[11.80]
s 64: [7.420], [10.20], [10.40], [10.50],
[10.110], [10.130]
s 64(3): [7.420], [10.90], [10.110]
s 64(5): [10.110]
s 65: [7.420], [10.110], [10.120], [10.130]
s 66: [10.230], [10.240]
s 67: [3.57], [3.410], [3.470]
s 68: [14.30]
s 71: [1.160], [1.240], [1.250],
[2.310], [9.20]
s 73: [15.210], [15.220]
s 87: [14.10]
s 91: [15.190]
s 98: [3.10], [3.160], [3.390], [3.400],
[15.230], [15.268]
s 98(1): [3.380], [3.400]
s 98(1)(c): [15.268]
s 98(4)(c): [3.400]
s 99: [3.10], [3.250], [3.260]
s 102: [15.460]
s 104: [15.440], [15.460]
s 105: [15.440], [15.460]
s 106: [15.440], [15.450]
s 106(1)(a): [15.460]
s 106(2): [15.480]
s 107: [15.570]
s 108: [15.600]
ss 117–​125: [15.510]
s 133: [15.420]
s 134: [15.410], [15.420]
s 157: [8.220], [8.250]
s 158: [8.240], [8.250], [8.340]
s 158(2): [8.250], [8.340]
s 159: [8.590]
s 159(1): [8.590]
s 159(2): [8.590]
s 161: [8.270]
s 161(2): [8.290]
s 162: [8.590], [8.600]
s 162(1): [8.713]
ss 164–​167: [8.410]
s 164: [8.400]
s 165: [8.400]
s 166: [8.394], [8.400]
s 166(1): [8.475]
s 166(1)(d): [8.470]
s 166(1)(e): [8.475], [8.660]
s 166(2): [8.660], [8.700]
ss 168–​170: [8.394]
s 168: [8.530]
s 169: [8.550]
s 170: [8.560]
s 171: [8.480]
s 173: [8.760]
s 174: [8.760]
s 175: [8.790], [8.800]
s 175(1)(a): [8.713]
s 175(2): [8.713]
s 175(4): [8.770]
s 176: [8.790], [8.800]
s 177: [8.840], [8.850]
s 179: [8.870]
s 181: [8.930], [8.940], [8.1007]
s 182: [8.880], [8.890], [8.1007]
s 183: [8.475], [8.713], [8.900], [8.910]
s 184: [8.960]
Civil and Administrative Tribunal Act 2013:
[1.530]
ss 82–​84: [15.390]
Commercial Arbitration Act 2010: [4.340],
[5.20], [5.30], [5.40], [5.90], [5.340]
s 7: [5.70]
s 8: [5.70]
s 8(1): [5.85]
s 10: [5.90]
s 11: [5.90]
s 12: [5.90]
s 13: [5.90]
s 16: [5.90]
s 18: [5.110]
s 19: [5.110]
s 20: [5.90]
s 22: [5.90]
ss 23–​25: [5.110]
s 28: [5.110]
s 29: [5.110]
s 31: [5.110]
s 32: [5.110]
s 33B: [5.110]
s 34: [5.140]
s 34(2): [5.130]
s 34(3): [5.130]
s 34A: [5.130], [5.140]
s 35: [5.160], [5.300]
s 36: [5.160]
Court Suppression and Non-​Publication Orders
Act 2010: [1.160], [1.270], [1.280], [9.20],
[14.300]
s 3: [1.280]
s 7: [1.270], [9.20]
s 8: [1.270], [9.20]
s 16: [1.280]
Courts Legislation Miscellaneous Amendments
Act 2002: [2.300]
xxix
Civil Procedure in New South Wales
ss 121–​126: [14.170], [14.180]
s 121: [14.170], [14.180]
s 121(2): [14.170]
s 122: [14.170], [14.180]
s 122(1): [14.170]
s 122(2): [14.170], [14.200]
s 122(3)(5): [14.170]
s 122(3)(a): [14.170]
s 122(3)(b): [14.170]
s 122(4): [14.170]
s 122(5): [14.170]
s 123: [14.170], [14.180]
s 124: [14.170], [14.180]
s 125: [14.170], [14.180]
s 125(1)(a): [14.170]
s 125(1)(b): [14.170]
s 126: [14.170]
ss 126A–​126E: [14.250]
s 126A: [14.240]
s 126B: [14.240], [14.260]
s 126B(2): [14.240]
s 126B(3): [14.240]
ss 126G–​126I: [14.10]
s 126J: [14.270], [14.275]
s 126K: [14.270], [14.275]
s 126K(1): [14.270]
s 126K(2): [14.270]
s 126K(2)(a): [14.270]
s 126K(2)(b): [14.270]
s 127: [14.10]
s 128: [14.10]
s 128A: [6.265], [14.10]
s 129: [14.40], [14.300], [14.310]
s 129(5): [14.300]
s 130: [14.40], [14.280], [14.300], [14.310]
s 130(1): [14.290], [14.300]
s 130(4): [14.300]
s 130(5): [14.300]
s 130(5)(d): [14.300]
s 130(5)(e): [14.290]
s 131: [14.40], [14.370], [14.380]
s 131(2)(a): [14.370]
s 131A: [14.30], [14.40], [14.50], [14.70],
[14.140]
s 131A(1): [14.40]
s 131A(2): [14.40]
s 132: [14.40], [14.50]
s 133: [14.40], [14.50]
s 136B(4): [14.240]
s 138(1)(b): [12.420]
s 187: [14.10]
Courts and Crimes Legislation Further
Amendment Act 2010: [8.170], [8.1050]
Sch 6.2: [2.150]
Sch 6.4: [8.190]
Courts and Other Legislation Further
Amendment Act 2013: [2.150]
Crimes (Criminal Organisations Control)
Act 2009: [1.310]
Pt 2: [1.310]
Pt 3: [1.310]
ss 5–​13: [1.310]
s 9(1): [1.310]
s 12: [1.310]
s 13(2): [1.310]
ss 14–​18: [1.310]
ss 19–​25: [1.310]
s 39: [1.310]
Criminal Appeal Act 1912
s 5F: [12.420]
Criminal Procedure Act 1986
Ch 6, Pt 5: [14.10]
Pt 5, Div 2: [14.10]
Div 1B: [14.10]
s 126H: [14.10]
District Court Act 1973: [1.30], [2.130]
s 44: [11.220]
s 47: [11.220]
s 127: [15.300]
s 127(2): [15.330]
s 134: [6.20]
s 140: [6.163]
s 141: [6.163]
s 142N: [15.300]
District Court Rules 1973: [1.30]
Dust Diseases Tribunal Act 1989: [1.560]
Dust Diseases Tribunal Regulation 2013
cl 34: [4.155]
Electronic Transactions Act 2000: [2.300]
cl 14: [2.310]
ss 14A–​14R: [2.300]
Sch 1, cl 2: [2.330]
Sch 1, cl 3: [2.300], [2.330]
Evidence Act 1995: [1.30], [6.210], [6.260],
[13.50], [14.20], [14.270]
Pt 3.10: [14.40]
Div 1C: [14.270]
s 76: [13.260]
ss 117–​120: [14.130]
s 117: [14.120], [14.165], [14.190]
s 118: [14.40], [14.90], [14.120], [14.140],
[14.200]
s 119: [14.40], [14.90], [14.120], [14.140],
[14.165]
s 120: [14.120]
Evidence Act 2005
s 7: [14.40]
Evidence Amendment Act 2007: [14.20], [14.30]
Government Information (Public Access) Act
2009: [12.10], [12.70]
Home Building Act 1989: [6.20]
xxx
Table of Statutes
s 48: [6.80]
s 50C: [6.80], [6.100], [6.110]
ss 50C–​50F: [6.110]
s 50C(1)(a): [6.80]
s 50C(1)(b): [6.80]
s 50D: [6.100]
s 50F: [6.140]
ss 52–​56: [6.145]
s 52: [6.140]
s 55: [6.140]
s 56: [6.140]
s 56A: [6.80]
s 57: [6.80], [6.100]
s 57A: [6.80], [6.100]
s 58: [6.100]
s 60C: [6.80], [6.100]
s 60E: [6.80], [6.100]
s 62A: [6.80], [6.100], [6.110]
s 62B: [6.80], [6.100], [6.110]
s 62D: [6.110], [6.110]
Independent Commission Against Corruption
Act 1988: [1.550]
Industrial Relations Act 1996: [1.515]
s 165: [12.370]
s 207: [12.370]
Interpretation Act 1987
s 21: [14.40]
s 40: [2.330]
s 41: [2.330]
Pt 6: [2.280]
Jurisdiction of Courts (Cross-​vesting) Act 1987
s 5: [6.30]
Land and Environment Court Act 1979: [1.490]
s 34AA: [4.155]
s 57: [15.300]
s 58: [15.300]
Law Enforcement (Controlled Operations) Act
1997: [12.420]
Law Enforcement (Powers and Responsibilities)
Act 2002
s 3: [13.130]
s 19B: [13.130]
Local Court Act 2007: [1.30]
s 29: [1.510]
ss 39–​41: [15.400]
s 39: [15.390]
s 40: [15.390]
Legal Profession Act 2004: [3.190]
Local Court Rules 2009: [1.30]
Legal Profession Uniform Conduct (Barristers)
Rules 2015
r 36: [4.10]
Local Courts (Civil Claims) Act 1970: [2.130]
Mental Health Act 2007: [1.570]
Legal Profession Uniform Law: [3.190]
ss 181–​183: [8.960]
Motor Accidents Compensation Act 1999
s 109: [6.80]
Legal Profession Uniform Law Application
Act 2014
s 193: [3.220]
Sch 2: [3.220], [9.20], [9.30]
Oaths Act 1900: [13.50], [13.60]
s 26: [13.110]
s 26B: [13.110]
s 27: [13.110]
s 27A: [13.110]
ss 29–​31: [13.190]
s 32: [13.110]
s 33: [13.190]
s 34: [13.110]
Legal Profession Uniform Law Application
Regulation 2015
Pt 6: [3.190]
reg 59: [3.190]
Legal Profession Uniform Law Australian
Solicitors’ Conduct Rules 2015
r 7.2: [4.10]
Oaths Regulation 2011
regs 3–​7: [13.120]
Sch 1: [13.120]
Limitation Act 1969: [6.60], [6.100], [7.420],
[10.130]
s 11(3): [6.140]
s 13: [6.60]
s 14: [6.96]
s 14(1)(a): [6.80], [6.93]
s 14(1)(b): [6.80], [6.93], [6.100]
s 14B: [6.80], [6.96]
s 16: [6.80], [6.93], [6.96]
s 17: [15.410]
s 18A(1)(b): [6.100]
s 18A(2): [6.80], [6.100]
s 27(2): [6.80]
Privacy and Personal Information Protection
Act 1998
s 49: [4.155]
Professional Conduct and Practice Rules 2013
r 31: [14.220]
Revised Professional Conduct and Practice
Rules 1995
r 17: [13.200]
Road Transport (Vehicle Registration) Act 1997:
[12.70]
xxxi
Civil Procedure in New South Wales
Pt 25: [6.260]
Pt 25, Div 2: [6.210]
Pt 37, r 8: [12.380]
Pt 40, Div 1: [15.440]
Pt 42: [3.10]
Pt 42, Div 3: [15.230]
Pt 51: [15.380]
Pt 58: [8.170]
s 39: [5.30]
s 40: [5.30]
s 42: [5.30]
r 25.2(1)(c): [6.150]
r 1.8: [14.40], [14.60]
r 1.9: [14.40], [14.60]
r 1.9(3): [14.40]
r 1.9(4): [14.40]
r 1.9(5)(b): [14.40]
r 1.9(5)(c): [14.40]
r 1.12: [11.70]
rr 2.1–​2.3: [2.200]
r 2.1: [3.410], [3.460]
rr 3.1–​3.15: [2.310]
r 3.3: [2.310]
r 3.8: [2.310]
r 3.9: [2.310]
rr 4.2–​4.9: [9.20]
rr 5.1–​5.8: [12.60]
r 5.2: [12.20], [12.70]
r 5.3: [12.20], [12.40]
r 5.4: [12.20], [12.40], [16.10]
r 5.8: [12.50]
r 6.1: [9.60]
r 6.2: [9.20], [11.90]
r 6.2(3): [9.55]
r 6 2(3A): [9.55]
r 6.2(4): [9.50], [11.70]
r 6.2(5): [9.50]
r 6.3: [9.20]
r 6.4: [9.20]
r 6.5: [9.20]
r 6.6: [9.20]
r 6.9: [9.60]
r 6.9(2): [9.60]
r 6.10: [9.60]
r 6.10(1)(a): [7.310]
r 6.11(1): [9.60]
r 6.11(2): [9.60]
r 6.12: [9.20]
r 6.13: [9.20]
r 6.14: [9.20]
r 6.17: [9.20]
r 6.18: [7.60], [7.190], [7.400], [7.410]
rr 6.18(1)(a)–​(c): [7.400]
r 6.18(1)(d): [7.400]
rr 6.19–​6.28: [7.60]
r 6.19: [7.170], [7.180], [7.190], [7.200],
[7.260], [7.400]
r 6.19(2): [7.320]
r 6.20: [7.190]
r 6.21: [7.190]
Road Transport (Vehicle Registration) Regulation
1998: [12.70]
reg 15: [12.70]
Security Industry Act 1997 (NSW): 14.370
Strata Schemes Management Act 2015
s 218: [4.155]
Succession Act 2006
s 98: [4.155]
Supreme Court Act 1970: [1.30], [1.470],
[2.130], [15.300]
s 38: [15.330]
s 44: [15.300]
s 46A: [15.300]
s 46B: [15.300]
s 48: [15.300]
s 66(4): [6.163]
s 75A: [15.300]
s 75A(5): [15.300]
s 101: [15.300], [15.310]
s 101(1): [15.330]
s 101(2): [15.330]
s 102: [15.300]
Supreme Court Rules 1970: [1.30], [10.130],
[12.340]
Pt 51, r 23: [1.360], [1.370]
r 1(1): [2.130]
r 13: [8.80], [8.130]
Transport Administration Act 1988: [14.70]
s 35R: [14.70]
Uniform Civil Procedure (Amendment No
83) Rule 2016: [11.380]
Uniform Civil Procedure Rules 2005: [1.30],
[2.10], [2.130], [2.180], [2.280], [2.320],
[3.10], [3.57], [3.500], [5.210], [8.80],
[8.170], [10.10], [10.40], [10.180], [10.200],
[11.10], [12.10], [12.20], [12.30], [12.50],
[12.110], [12.230], [13.50], [13.80], [14.30],
[14.40], [15.10], [15.20], [15.200], [15.210]
Pt 4: [9.117]
Pt 5: [12.50]
Pt 6, Div 5: [7.60]
Pt 10: [11.220]
Pt 11: [11.220], [11.360]
Pt 11, Div 2: [11.440]
Pt 11A: [11.360], [11.410], [11.480]
Pt 11A, Div 1: [11.460]
Pt 11A, Div 2: [11.450], [11.460]
Pt 11A, Div 3: [11.480]
Pt 11A, Div 4: [11.500]
Pt 14: [9.70]
Pt 15: [9.370]
Pt 17: [9.130]
Pt 18: [10.20]
Pt 21, r 10: [12.145]
Pt 24: [5.190]
xxxii
Table of Statutes
Uniform Civil Procedure Rules 2005
— cont
r 6.21(2): [7.190]
r 6.22: [7.60], [7.170], [7.190], [7.210],
[7.220], [7.230], [7.400]
r 6.24: [7.180], [7.190], [7.320], [7.330],
[7.340], [7.360], [7.390]
r 6.25: [7.180]
r 6.27: [7.180], [7.340]
r 6.28: [7.320], [7.330], [7.420], [10.20],
[10.110]
r 6.29: [7.170], [7.190], [7.330], [7.340],
[7.350]
r 7.1: [9.20]
r 7.2: [7.50]
r 7.4: [8.80], [8.150], [8.190], [8.680]
r 7.5: [8.190]
r 7.6(1): [7.50]
r 7.10(1): [7.50]
r 7.10(2): [7.50]
r 7.13: [7.50]
r 7.14: [7.50]
r 7.19: [7.50]
r 7.20: [7.50]
r 7.22: [15.30]
r 9.1: [7.310]
r 9.6(1): [11.70]
r 10.1: [11.20], [11.30]
r 10.1(2): [15.30]
r 10.2: [11.20]
r 10.3: [11.300], [11.310], [11.330]
r 10.4: [11.330]
r 10.5: [11.40], [11.50], [11.100]
r 10.6: [11.150], [11.160], [11.340],
[11.350]
rr 10.9–​10.12: [11.140]
r 10.9: [11.130]
r 10.10: [11.130]
r 10.11: [11.130]
r 10.12: [11.130]
r 10.13: [11.180]
r 10.14: [11.200], [11.220]
r 10.14(3): [11.120]
r 10.19: [11.280]
r 10.20: [11.110]
r 10.20(2): [11.70], [11.100]
r 10.20(2)(d): [11.100]
r 10.21: [11.100], [11.110]
r 10.22: [11.130], [11.140]
r 10.23: [11.130]
r 10.24: [11.130]
r 10.25: [11.130]
r 10.26: [11.130], [11.140]
r 11.1: [11.410]
r 11.2: [11.380], [11.430]
r 11.4: [11.360], [11.390]
r 11.5: [11.400]
r 11.6: [11.400]
r 11.7: [11.400]
r 11.8A: [11.450]
r 11.10: [11.440]
r 11.10(1)(a): [11.450]
r 11.11: [11.450]
r 11A.3: [11.460], [11.470]
rr 11A.4–​11A.8: [11.460]
r 11A.4: [11.470]
r 11A.4(3): [11.470]
r 11A.4(2)(d): [11.470]
r 11A.4(3)(a): [11.470]
r 11A.4(3)(c): [11.470]
r 11A.5: [11.470]
r 11A.6: [11.470]
r 11A.6(2): [11.470], [11.490]
r 11A.6(3): [11.470]
r 11A.8: [11.470]
r 11A.9: [11.490]
r 11A.10: [11.480], [11.490]
r 11A.11: [11.480]
r 11A.12: [11.480]
r 12.1: [15.280]
r 12.3: [15.280]
r 12.4: [15.280]
r 12.5: [9.60]
r 12.6: [9.60]
r 12.7: [15.150], [15.160], [15.180]
r 12.9: [15.180]
r 12.11: [9.60]
r 13: [11.450]
r 13.1: [15.70], [15.80], [15.100]
r 13.4: [3.57], [15.100], [15.110], [15.180]
r 14.2: [9.70]
r 14.3: [9.60], [15.30]
rr 14.6–​14.11: [9.120]
r 14.7: [9.160]
r 14.9: [9.160]
r 14.14: [9.117], [9.120], [9.200], [15.20]
rr 14.17–​14.20: [9.120]
r 14.19: [9.170]
r 14.20: [9.117]
r 14.22: [9.120]
r 14.23: [9.120], [9.240]
r 14.26: [9.70]
r 14.27: [9.70], [9.130]
r 14.28: [9.390], [15.100]
r 15.1: [9.270], [9.370]
r 15.3: [9.270], [9.370]
r 15.5: [9.270], [9.370]
r 15.6: [9.270]
r 15.9: [9.270]
r 15.10: [9.270], [9.370]
rr 16.1–​16.3: [15.40]
r 16.1: [15.30]
r 16.2: [9.70], [15.30]
r 16.3: [9.70], [15.30]
r 16.3(3): [15.30]
rr 16.6–​16.8: [15.40]
r 16.6: [9.20], [15.30]
r 16.7: [15.30]
rr 17.1–​17.4: [13.630]
r 18.5: [11.100]
xxxiii
Civil Procedure in New South Wales
Uniform Civil Procedure Rules 2005
— cont
r 19.1: [10.20], [10.30]
r 19.2: [7.420], [10.20], [10.30]
r 19.2(4): [10.110]
r 19.4: [10.20]
r 20.2: [4.270]
r 20.6: [4.270]
r 20.8: [5.30]
r 20.12: [5.30]
rr 20.13–​20.24: [5.220]
rr 20.25–​20.30: [15.240]
r 20.26(2): [15.230]
r 20.26(2)(c): [15.230]
r 20.26(3)(a): [15.230]
r 20.26(3)(b): [15.230]
r 20.26(12): [15.230]
r 20.30: [15.230]
r 21.1: [12.230]
rr 21.1: [12.250]
r 21.2: [12.180], [12.230]
r 21.3: [12.230], [14.30]
r 21.3(1): [12.230]
r 21.3(2)(d): [14.30]
r 21.4(2): [12.230]
r 21.4(3): [12.230]
r 21.5: [12.230]
r 21.6: [12.230]
r 21.7: [12.230]
r 21.8: [12.230]
rr 21.9–​21.13: [12.120]
r 21.10: [12.150], [12.145]
r 21.10(1)(b): [12.145]
r 21.12: [12.110]
rr 22.1–​22.6: [12.470]
r 22.1(4): [12.460]
r 22.1(3): [12.480]
r 22.2: [12.460]
r 22.2(c): [14.30]
rr 23.1–​23.5: [13.680]
r 23.8: [13.700]
rr 25.1–​25.9: [6.160]
r 25.3: [6.150]
r 25.4: [6.150]
rr 25.5–​25.6: [6.150]
r 25.7: [6.150]
rr 25.10–​25.17: [6.200]
r 25.10: [6.210]
r 25.11: [6.150]
r 25.14: [6.150], [6.210]
r 25.14(1)(b): [6.186]
r 25.14(4)(b)(ii): [6.186]
rr 25.18–​25.24: [6.230]
r 25.19: [6.150], [11.70]
r 28.2: [7.460], [7.470]
r 28.5: [7.430], [7.440]
r 29.7(3): [9.20]
r 31.1: [13.30]
r 31.2: [13.30], [15.70]
r 31.4: [13.90], [13.100]
r 31.18: [13.250]
r 31.19: [13.310]
r 31.20: [13.310]
r 31.22: [13.370]
r 31.23: [13.370]
rr 31.24–​31.26: [13.530]
r 31.27: [13.370]
rr 31.28–​31.30: [13.390]
r 31.36: [13.390], [13.400]
rr 31.37–​31.45: [13.420]
rr 31.46–​31.54: [13.510]
r 33: [12.145]
rr 33.1–​33.13: [12.370]
r 33.3(4)(a): [12.145]
r 33.4: [12.380]
r 33.4(1): [12.380]
r 33.5: [11.100]
rr 34.1–​34.3: [12.140]
r 34.1: [12.145]
r 35.2: [13.20]
rr 35.3–​35.7B: [13.100]
r 35.3: [13.80], [15.70]
r 35.8: [11.20], [11.60], [11.70]
r 36(3): [13.400]
r 36.4: [15.430]
r 36.11: [15.430]
rr 36.15–​36.16: [15.40]
r 36.15: [15.70]
r 36.16: [15.60], [15.70]
r 36.16(2)(a): [15.50], [15.60]
r 36.16(2)(b): [15.50]
rr 37.1A–​37.7: [15.580]
r 37.1A: [15.560]
rr 38.1–​38.7: [15.620]
r 38.1: [15.590]
r 38.2: [15.590]
r 39: [15.480]
r 39.1: [15.470]
rr 39.2–​39.20: [15.490]
rr 39.34–​39.43: [15.520]
r 39.34: [15.500]
r 40.7: [6.210], [11.100]
r 42.1: [3.200]
r 42.2: [3.190], [15.268]
r 42.3: [3.390]
r 42.5: [3.190], [15.268]
r 42.6: [10.20]
r 42.8: [13.650]
r 42.9: [13.660]
r 42.10: [3.100]
rr 42.13A–​42.15A: [15.240]
r 42.14: [15.230]
r 42.15: [15.230]
r 42.15A: [15.230]
r 42.16: [15.40]
r 42.17: [15.240]
r 42.19: [15.280]
r 42.21: [3.410], [3.450],
[3.460]
r 42.35: [15.268]
xxxiv
Table of Statutes
Uniform Civil Procedure Rules 2005
— cont
r 44.7: [11.360]
r 45.6: [9.20]
r 45.7: [9.20]
rr 47.1–​47.4: [5.180]
r 47.5: [5.190]
rr 47.6–​47.8: [5.180]
r 47.10–​47.20: [5.190]
r 51.53: [1.360], [1.370]
r 58.2: [8.710], [8.810]
Sch 6: [11.380], [11.390], [11.400],
[11.410], [11.430]
s 24: [1.430]
s 32: [1.440]
s 36: [1.440]
Civil Procedure Act 2010
s 7: [2.80]
s 28: [2.80]
s 37M: [2.80]
s 37N: [2.80]
s 43(3)(f): [2.80]
Criminal Procedure Act 2009
s 56(3): [3.120]
s 56(4): [3.220]
s 98(1)(a): [3.200]
s 99: [3.220]
Uniform Civil Procedure Rules (2005)
r 31.1: [13.20]
r 31.2: [13.20]
Evidence Act 2008: [14.20]
Uniform Civil Procedure Rules (Amendment No
19) 2007: [8.150]
Fair Trading Act 1999: [7.165]
Legal Profession Uniform Law Application
Act 2014
Sch 2, cl 2: [3.220]
Uniform Civil Procedure Rules (Amendment No
30) 2009: [8.150]
Uniform Civil Procedure Rules (Amendment No
41) 2011: [8.170]
Serious Sex Offenders Monitoring Act 2005
s 42: [1.180]
s 42(1): [1.180]
Uniform Civil Procedure Rules (Amendment No
59) 2013: [15.230]
Supreme Court Act 1986
Pt 4A: [8.120], [8.873]
s 33C: [8.873]
s 33C(1): [8.873]
s 33H: [8.873]
s 33Q: [8.873]
s 33R: [8.873]
s 33ZB: [8.873]
Workers Compensation Act 1987
s 151D: [6.80]
Workplace Injury Management and Workers
Compensation Act 1998: [1.520]
NORFOLK ISLAND
Supreme Court (General Civil Procedure)
Rules 2005
O 8, r 2: [8.190]
Evidence Act 2004: [14.20]
NORTHERN TERRITORY
Defamation Act 2006: [3.110]
UNITED KINGDOM
Evidence (National Uniform Legislation) Act
2011: [14.20]
Civil Procedure Rules 1998: [1.110], [2.20]
r 1.1: [3.57]
Human Rights Act 1998: [14.370]
QUEENSLAND
Special Immigration Appeals Commission
s 6(1): [14.370]
Limitation of Actions Act 1974
s 10(1): [8.475]
TREATIES AND CONVENTIONS
TASMANIA
International Covenant on Civil and Political
Rights: [1.400]
Art 14: [1.410]
Art 14(1): [1.400], [1.410]
Evidence Act 2001: [14.20]
VICTORIA
Charter of Human Rights and Responsibilities
Act 2006: [1.400]
s 7: [1.440]
xxxv
CHAPTER 1
Introduction to Civil Procedure
[1.10]
[1.20]
[1.80]
[1.90]
INTRODUCTION.............................................................................................................
PROCEDURAL LAW..........................................................................................................
[1.25]
Judging Civil Justice...............................................................................
[1.30]
Sources of procedural law...............................................................................
[1.30]
Powers provided by statute.....................................................................
[1.40]
Inherent and implied jurisdiction..............................................................
[1.50]
Grassby v The Queen............................................................................
[1.70]
Pelechowski v Registrar, Court of Appeal....................................................
GUIDING PRINCIPLES FOR PROCEDURE..........................................................................
ADVERSARIAL SYSTEM OF CIVIL LITIGATION...................................................................
[1.90]
Main features of adversarial and inquisitorial systems......................................
[1.100]
Review of the Adversarial System of Litigation: Rethinking the Federal
Civil Litigation System.......................................................................... 10
[1.110]
Reforms of the adversarial system of litigation...............................................
Civil Justice Review..............................................................................
[1.130] “Cards on the table” approach to litigation...................................................
[1.140]
Baulderstone Hornibrook Engineering v Gordian Runoff...............................
THE PRINCIPLE OF OPEN JUSTICE.................................................................................
[1.170] Common law power to depart from the open justice principle......................
[1.180]
Hogan v Hinch...................................................................................
[1.200] Common law categories of cases that are exceptions to
the open justice principle..............................................................................
[1.210]
Witness v Marsden..............................................................................
[1.230]
Seven Network (Operations) Ltd v Warburton (No 1)..................................
[1.240] Statutory power to close the court in civil proceedings..................................
[1.250]
Civil Procedure Act 2005 (NSW).............................................................
[1.260]
Re HIH Insurance................................................................................
[1.270] Statutory power to make suppression and non-​publication orders.................
[1.280]
Court Suppression and Non-​Publication Orders Act 2010............................
[1.290]
Rinehart v Welker...............................................................................
[1.295]
“X” v Sydney Children’s Hospitals Specialty Network..................................
[1.298]
A v Bird; C v Bird.................................................................................
[1.300] The provision of reasons for decision.............................................................
[1.310]
Wainohu v New South Wales.................................................................
PRINCIPLE OF A FAIR TRIAL...........................................................................................
[1.330]
The Truth Can Cost Too Much...............................................................
[1.350]
Stead v State Government Insurance Commission......................................
[1.370]
Mastronardi v New South Wales............................................................
THE CROWN AS THE MODEL LITIGANT........................................................................
[1.390]
Model Litigant Policy for Civil Litigation...................................................
THE RIGHT TO A FAIR TRIAL RECOGNISED IN HUMAN RIGHTS LEGISLATION...............
[1.410]
International Covenant on Civil and Political Rights....................................
[1.420]
Human Rights Act 2004 (ACT)..............................................................
[1.430]
Charter of Human Rights and Responsibilities Act 2006 (Vic)........................
[1.450]
Civil Justice Review –​Human Rights Considerations....................................
THE NSW COURT SYSTEM: AN OVERVIEW....................................................................
[1.470] Supreme Court of New South Wales.............................................................
[1.490] Land and Environment Court of New South Wales........................................
[1.500] District Court of New South Wales................................................................
12
13
14
14
15
16
17
[1.120]
[1.150]
[1.320]
[1.380]
[1.400]
[1.460]
2
2
3
4
4
5
5
6
8
9
9
 23
24
25
27
28
28
29
29
32
42
45
46
47
48
48
51
54
55
55
57
57
58
58
59
61
61
61
61
1
Civil Procedure in New South Wales
[1.610]
[1.510] Local Court of New South Wales...................................................................
[1.515] Industrial Relations Commission....................................................................
[1.520] Workers’ Compensation Commission............................................................
[1.530] NSW Civil and Administrative Tribunal..........................................................
[1.550] Independent Commission against Corruption...............................................
[1.560] Dust Diseases Tribunal...................................................................................
[1.570] Mental Health Review Tribunal......................................................................
FEDERAL COURT STRUCTURE........................................................................................
[1.610] High Court of Australia..................................................................................
[1.620] Federal Court of Australia..............................................................................
[1.630] Family Court of Australia...............................................................................
[1.640] Federal Circuit Court of Australia...................................................................
62
62
62
62
62
62
63
63
63
65
65
65
INTRODUCTION
[1.10] This book is about civil procedure in New South Wales. It is confined to considering
the procedures by which civil disputes are processed in the Supreme, District and Local Courts
of New South Wales. This chapter will consider the following introductory issues:
• the meaning and sources of procedural law;
• features of an adversarial system of litigation;
• the principle of open justice;
• the principle of a fair trial; and
• an overview of the various court systems in New South Wales.
PROCEDURAL LAW
[1.20] Procedural law is the law that governs the conduct of proceedings before the court.
Procedural law is “rules which are directed to governing or regulating the mode or conduct
of court proceedings”: McKain v RW Miller & Co (SA) Pty Ltd (1991) 174 CLR 1 at
26–​27 per Mason CJ. It is the mode or method of proceeding to enforce a right; it is not
concerned with the law that establishes or defines the particular right. Thus it is described
as “adjectival” law. Procedural law is distinguished from substantive law in that procedural
law regulates the way in which substantive rights and obligations are claimed and enforced,
without impacting on the definition of those particular substantive rights. Substantive law is
the law that defines legal rights, duties, powers and liabilities. In tort claims, the substantive
law is governed by the lex loci delicti which means that the applicable law is the law of the
place where the wrongful act took place. Procedural law is governed by the lex fori which
means that the applicable laws of procedure and evidence will be the laws of the forum, that
is, the laws of the court which is hearing the claim. This means in a claim of negligence that
occurred in Victoria which is litigated in the Supreme Court of New South Wales, the law of
negligence is governed by the common law and any applicable Victorian statutes; however
the procedural law (meaning the way in which the case is litigated) is governed by the law of
New South Wales.
The distinction between substantive and procedural law was stated by the majority in
John Pfeiffer Pty Ltd v Rogerson [2000] HCA 36; (2000) 203 CLR 503 where Gleeson CJ,
Gaudron, McHugh, Gummow and Hayne JJ said at [99]:
2
[1.10]
Introduction to Civil Procedure
Chapter 1
Two guiding principles should be seen as lying behind the need to distinguish between
substantive and procedural issues. First, litigants who resort to a court to obtain relief must
take the court as they find it. A plaintiff cannot ask that a tribunal which does not exist in the
forum (but does in the place where a wrong was committed) should be established to deal,
in the forum, with the claim that the plaintiff makes. Similarly, the plaintiff cannot ask that
the courts of the forum adopt procedures or give remedies of a kind which their constituting
statutes do not contemplate any more than the plaintiff can ask that the court apply any
adjectival law other than the laws of the forum. Secondly, matters that affect the existence,
extent or enforceability of the rights or duties of the parties to an action are matters that, on
their face, appear to be concerned with issues of substance, not with issues of procedure. Or to
adopt the formulation put forward by Mason CJ in McKain [[1991] HCA 56; (1991) 174 CLR
1 at 26–​27], “rules which are directed to governing or regulating the mode or conduct of court
proceedings” are procedural and all other provisions or rules are to be classified as substantive
[Stevens v Head [1993] HCA 19; (1993) 176 CLR 433 at 445 per Mason CJ]. [footnotes
inserted in the text in square brackets]
The purpose of procedural law is to provide rules to facilitate dispute resolution. The basis of
the rules lies in the need to provide procedural fairness or due process to the parties in litigation
(eg, the rules ensure that the parties are aware of the case that they have to meet and allow the
parties to be heard). The rules are also concerned with promoting access to justice. Better access
to the courts is facilitated by ensuring that the rules address issues of cost and delay.
Judging Civil Justice
[1.25] Dame Hazel Genn, “Introduction: What Is Civil Justice for?” in Hazel Genn (ed), Judging Civil
Justice, 2008 Hamlyn Lecture (Cambridge University Press, 2010) pp 12–​16
The significance of procedure
The civil justice “system” then comprises the substantive law, the civil procedure rules, courts and
the judiciary. Although I do not want to focus on the detail of civil procedure, it is necessary to think
about the purpose of civil procedural rules, since it is these rules that have been the main target of civil
justice reformers. There seems to be common agreement around the world that a critical challenge in
solving the problems of cost, complexity and delay in civil justice is that of getting the rules right. But
why are the procedural rules so important? The answer is that the rules guarantee procedural fairness,
and procedural fairness is important both in its own right and through its link with substantive justice.
It has been argued that legal procedure is “a ritual of extreme social significance” and that the
characteristics of “a civilized country” are revealed not so much through the substantive law as in the
practice and procedure of the courts. Jeremy Bentham saw the rules of procedure as being central to
the machinery of civil justice. For Bentham, the power of procedure was in the link between evidence
and correct decisions (rectitude) and the role of procedure in achieving accuracy in decision making
continues to be seen as central today by procedural scholars. The system of procedure is designed to
ensure that judges have all of the appropriate evidence available so that they can find the material
facts and apply the substantive law to those facts. In this way, procedural rules reflect a sense of
justice. Procedure is the means by which substantive rights are enforced.
Indeed, it has recently been argued that rather than being mere rules, the procedures devised
for adjudicating civil cases are essentially “the means by which society expresses its underlying
meaning”. Procedure is important because of its link to substantive outcome. If substantive justice lies
in the correct application of legal principles to a factual situation, then procedures that increase the
likelihood of a correct decision being reached are vital.
It is also argued that procedure is important to litigants. There is a relatively substantial body of
literature in social psychology that provides firm empirical evidence first, that those involved in legal
decision-​making processes are able to distinguish procedure from outcome and second, that fair
[1.25]
3
Civil Procedure in New South Wales
Judging Civil Justice cont.
procedures make losing more acceptable and contribute to the legitimacy of the decision-​making
body. According to this research, the critical elements that contribute to perceptions of fairness are
the opportunity to be heard, the opportunity to influence the decision maker, even-​handedness
of the decision maker, and being treated with courtesy and respect. Thus procedural justice is not
only theoretically important as the route to substantively correct decision making but is an important
influence on user perceptions of the fairness of legal processes. In considering the significance of
procedural justice, Lawrence Solum argues that it is fundamentally about participation:
Procedural justice is deeply entwined with the old and powerful idea that a process that
guarantees rights of meaningful participation is an essential prerequisite for the legitimate
authority of action-​guiding legal norms.
Solum further suggests that while meaningful participation in legal proceedings requires parties to
have notice of the case against them and the opportunity to be heard, it also requires a reasonable
balance between cost and accuracy. However, the challenge facing any civil justice system is where
to find the balance between efficiency and substantive justice. How much justice can we afford? Or,
as I argue in the next chapter, perhaps it is more a question of how much justice can we afford to
forego? How much procedural justice do you need to achieve an appropriate degree of substantive
justice? Even in the early part of the nineteenth century, Bentham was concerned about the burden
on both parties involved in litigation. He argued that it was important to reduce the delays, vexations
and expenses involved in pursuing civil litigation. In Bentham’s terminology “vexation” is an amalgam
of the frustrations, distresses and irritations involved in pursuing legal action. The challenge, then,
is to find the balance between procedures that are seen as fair, that contribute to substantive
justice and that provide reasonable access to justice so that rights can be enforced, but are not so
complicated or expensive as to make proceedings inaccessible. But what is the correct measure
of procedure? Litigant satisfaction with process and outcome? Correct decisions and substantive
justice? How accurate do we need to be? When we say the outcome was “correct”, what does that
mean? Adrian Zuckerman has argued that in the end, measuring the success of procedures in doing
justice is a complex judgement relating to rectitude of decision, time and cost. “There is no perfect
rectitude of decision, justice cannot be dispensed instantly without some delay, and justice cannot
be absolutely free of cost constraints. Each system has had to balance the competing demands and
strike a compromise.”
[footnotes omitted]

Sources of procedural law
Powers provided by statute
[1.30] The sources of procedural law in the NSW Supreme, District and Local Courts are
mainly found in the Civil Procedure Act 2005 (NSW) (CPA) and the Uniform Civil Procedure
Rules 2005 (NSW) (UCPR). Both the CPA and the UCPR apply in the Supreme, District and
Local Courts (they also apply in the Land and Environment Court and the Dust Diseases
Tribunal). The CPA provides that a Uniform Rules Committee may make rules that are
consistent with the CPA (see ss 8 and 9). Some procedural rules can also be found in the
various court rules; for example, the Supreme Court Rules 1970, the District Court Rules
1973 and the Local Court Rules 2009. The specific court Acts deal with jurisdictional matters,
the constitution of the court and delegation of powers; however they also enable the power of
a rules committee to make procedural rules: the Supreme Court Act 1970 (NSW), the District
Court Act 1973 (NSW) and the Local Court Act 2007 (NSW). Procedure can also be set out
4
[1.30]
Introduction to Civil Procedure
Chapter 1
in a practice note that is delivered by the particular court, for example, see Practice Note SC
Gen 7 Supreme Court –​Use of Technology in Chapter 12.
It should also be noted that the rules of evidence which regulate the information that can
be used as evidence in the hearing of the substantive cause of action (and also in interlocutory
hearings such as non-​disclosure of documents due to privilege) are mainly found in the
Evidence Act 1995 (NSW) and the common law.
Inherent and implied jurisdiction
[1.40] There is also inherent jurisdiction (or inherent power) in superior courts of record
(such as the Supreme Court) to regulate their processes and prevent an abuse of process: Jago
v District Court of New South Wales (1989) 168 CLR 23; Batistatos v Roads and Traffic
Authority of NSW (2006) 226 CLR 256; 227 ALR 425; [2006] HCA 27.
The District Court and Local Court have a limited jurisdiction which arises expressly
under statute or is derived by implication from statutory provisions conferring particular
jurisdiction: Grassby v The Queen (1989) 168 CLR 1 at 16–​17.
Grassby v The Queen
[1.50] Grassby v The Queen (1989) 168 CLR 1
DAWSON J (MASON CJ, BRENNAN, DEANE and TOOHEY JJ agreeing)
[21] … [I]‌t is undoubtedly the general responsibility of a superior court of unlimited jurisdiction for
the administration of justice which gives rise to its inherent power. In the discharge of that responsibility
it exercises the full plenitude of judicial power. It is in that way that the Supreme Court of New South
Wales exercises an inherent jurisdiction. Although conferred by statute, its powers are identified by
reference to the unlimited powers of the courts at Westminster. On the other hand, a magistrate’s
court is an inferior court with a limited jurisdiction which does not involve any general responsibility
for the administration of justice beyond the confines of its constitution. It is unable to draw upon the
well of undefined powers which is available to the Supreme Court. However, notwithstanding that its
powers may be defined, every court undoubtedly possesses jurisdiction arising by implication upon the
principle that a grant of power carries with it everything necessary for its exercise (ubi aliquid conceditur,
conceditur et id sine quo res ipsa esse non potest). Those implied powers may in many instances serve a
function similar to that served by the inherent powers exercised by a superior court but they are derived
from a different source and are limited in their extent. The distinction between inherent jurisdiction and
jurisdiction by implication is not always made explicit, but it is, as Menzies J points out, fundamental.
[22] The point may be illustrated by reference to the power to punish summarily for contempt not
committed in the face of the court. Such a power is inherent in a superior court but forms no part
of the powers of an inferior court: see Reg v Lefroy (1873) LR 8 QB 134. A superior court, however,
not only has power to punish contempt against itself committed out of court, but in the exercise of
its inherent jurisdiction it may prevent and punish summarily as a contempt any interference with
the due course of justice in an inferior court. In John Fairfax & Sons Pty Ltd v McRae [1955] HCA 12;
(1955) 93 CLR 351 this Court pointed out that the jurisdiction over contempts committed against
inferior courts was inherited by the superior court as “custos morum of all the subjects of the realm”
(at p 365) and was but an aspect of “the traditional general supervisory function of the King’s Bench,
the function of seeing that justice was administered and not impeded in lower tribunals” (at p 363).
The immediate basis for the exercise of such a function is to be found in the absence of any inherent
jurisdiction in inferior courts similarly to protect themselves: see R v Davies (1906) 1 KB 32, at pp 47-​
48. A magistrate’s court in New South Wales now has, of course, a statutory power to punish for
contempt: Justices Act, s 152.
[23] It would be unprofitable to attempt to generalize in speaking of the powers which an inferior
court must possess by way of necessary implication. Recognition of the existence of such powers will
[1.50]
5
Civil Procedure in New South Wales
Grassby v The Queen cont.
be called for whenever they are required for the effective exercise of a jurisdiction which is expressly
conferred but will be confined to so much as can be “derived by implication from statutory provisions
conferring particular jurisdiction”.

[1.60] An implied power may be found where a court has jurisdiction under its statute, but
no provision is made in the statute for the making of an order which is necessary to carry out
the court’s statutory powers: R v Mosely (1992) 28 NSWLR 735 at 739 referring to Stanton v
Abernathy (1990) 19 NSWLR 656. In the case of a court whose powers are defined by statute,
such as the District Court and the Local Court, “there is an implied power to do that which
is required for the effective exercise of its jurisdiction”: TKWJ v The Queen (2002) 212 CLR
124; [2002] HCA 46 at [44] per Gaudron J. (In TKWJ, it was not necessary for the effective
exercise of jurisdiction for a trial judge to give an “advance ruling” on evidence.) A statutory
court has the power to do that which is “really necessary to secure the proper administration
of justice in the proceedings before it”: see John Fairfax & Sons Ltd v Police Tribunal (NSW)
(1986) 5 NSWLR 465 at 476 and John Fairfax Group Pty Limited v Local Court of NSW
(1991) 26 NSWLR 131 at 161. The term “necessary” does not mean “essential” but rather
it is to be “subjected to the touchstone of reasonableness”: Pelechowski v Registrar, Court of
Appeal (NSW) (1999) 198 CLR 435 at 451 per Gaudron, Gummow and Callinan JJ.
Pelechowski v Registrar, Court of Appeal
[1.70] Pelechowski v Registrar, Court of Appeal (1999) 198 CLR 435
GAUDRON, GUMMOW and CALLINAN JJ
[1]‌The appellant, Karl Pelechowski, appeals against his conviction and sentence by the New South
Wales Court of Appeal on a charge of contempt in respect of an order made against him in the District
Court of that State.
The facts
[2]‌At all material times, Mr Pelechowski and Ms Penelope Jane Stephens have been and are, as joint
tenants, the registered proprietors of Lot 2033 in Deposited Plan No 255371. This Lot (“the Land”)
constitutes 9 Kippax Place, Erskine Park, an outer suburb of Sydney, and is land under the provisions
of the Real Property Act 1900 (NSW) (“the Real Property Act”).
[3]‌On 18 January 1983, Michael Rahme (on the one part) and “Karl & Penny Pelechowski” (on the
other part) entered into an “AGREEMENT FOR LOAN” (“the Agreement”). The Agreement provided
that Mr Rahme would lend $50,000 to the borrowers for a period of 12 months from 18 January 1983
and that the borrowers would repay the principal with interest of $7,000. The Agreement stated that,
should repayment of the loan exceed “the expiry date”, the borrowers agreed to pay “14% monthly
interest until settlement of property”. The Agreement indicated that “Karl & Penny Pelechowski” were
“Real Estate Licensee” [sic].
[4]‌The parties had become acquainted during a period leading up to January 1983 when Mr Rahme
purchased a property through a real estate business conducted by Mr Pelechowski and Ms Stephens
at Mount Druitt. Mr Rahme provided the loan moneys to the borrowers from cash held by him in a
bank safe deposit box.
The main proceedings
[5]‌On 20 February 1990, Mr Rahme caused a Statement of Liquidated Claim to be issued out of the
District Court of New South Wales at Penrith. Mr Rahme claimed the sum of $92,439.95 plus interest
6
[1.60]
Introduction to Civil Procedure
Chapter 1
Pelechowski v Registrar, Court of Appeal cont.
from Mr Pelechowski and “Penny Pelechowski”, alleged to be owing as a result of the Agreement.
On 5 April 1993, an Amended Statement of Liquidated Claim was issued out of the District Court at
Penrith which, among other things, indicated that Ms Pelechowski was also known as “Penelope Jane
Stephens”.
[6]‌On 2 February 1994, the proceedings reflected in the Amended Statement of Liquidated Claim
began before Christie DCJ at Parramatta. On that occasion, evidence was led on behalf of Mr Rahme
from a person who witnessed the Agreement. At the conclusion of that evidence, the proceedings
were adjourned until 15 April 1994 at Sydney.
[7]‌On 29 March 1994, Mr Rahme filed a notice of motion seeking an order against “the Defendants
Karl Pelechowski and Penny Pelechowski (also known as Penelope Jane Stephens)” restraining them
from selling, disposing, encumbering, further encumbering or otherwise dealing with their interest
in the Land. The restraining order was sought “pending further order of this Honourable [District]
Court”. In the alternative, Mr Rahme sought that “Karl Pelechowski and Penny Pelechowski (also
known as Penelope Jane Stephens)” be restrained from dealing with a portion of the proceeds of sale
of the property “pending final determination of the Hearing of [Mr Rahme’s] Claim as against the
Defendants”.
[8]‌On 15 April 1994, Christie DCJ heard the balance of the evidence in the main proceedings
as well as the notice of motion. Mr Rahme was represented by counsel, Mr Pelechowski appeared
in person and Ms Stephens did not appear, whether by counsel or personally. On the same day,
Christie DCJ provided oral reasons for judgment. His Honour gave judgment for Mr Rahme against
Mr Pelechowski and Ms Stephens in the sum of $105,090 and made a limited order as to costs.
Christie DCJ then dealt with the notice of motion and stated:
That motion seeks to protect [Mr Rahme’s] interest in a verdict which he now has against the
defendants of $105,090 with the exception of the costs. …
Having regard to the view that I have of the defendants’ evidence in this matter I propose to
accede to the orders sought in [the] notice of motion and I order that the defendants Karl
Pelechowski and Penny Pelechowski also known as Penelope Jane Stephens be restrained
from selling or otherwise disposing of, encumbering or further encumbering or otherwise
dealing with their interest in any way in the property situate and known as 9 Kippax Place,
Erskine Park. I order that that order shall continue until further order or payment of the
verdict.
Mr Pelechowski was, but Ms Stephens was not, in court when Christie DCJ gave judgment for
Mr Rahme and made the order restraining any dealing in the Land.
[9]‌It can be seen that the order granted by Christie DCJ had the effect of restraining any dealing
in the Land until further order or payment of the verdict.
…
[50] Some guidance in the matter is provided by the decision of this Court in Grassby v The Queen.
It was there held that specific provision upon the subject made in the Justices Act 1902 (NSW) left
no room for the implication of a discretionary power to terminate proceedings in a manner other
than that provided. The result was that a magistrate had no power to order a stay of committal
proceedings as an abuse of process. The leading judgment was given by Dawson J.
…
Dawson J concluded that recognition of the existence of the powers which an inferior court must
possess by way of necessary implication will be called for:
whenever they are required for the effective exercise of a jurisdiction which is expressly
conferred but will be confined to so much as can be “derived by implication from statutory
provisions conferring particular jurisdiction”.
[1.70]
7
Civil Procedure in New South Wales
Pelechowski v Registrar, Court of Appeal cont.
[51] The term “necessary” in such a setting as this is to be understood in the sense given it by
Pollock CB in The Attorney-​General v Walker [(1849) 3 Ex 242; 154 ER 833 at 255-​256 (Ex), 838-​839
(ER)], namely as identifying a power to make orders which are reasonably required or legally ancillary
to the accomplishment of the specific remedies for enforcement provided in Div 4 of Pt 3 of the
District Court Act. In this setting, the term “necessary” does not have the meaning of “essential”;
rather it is to be “subjected to the touchstone of reasonableness”.
[52] In the present case, an asset preservation order might properly have restrained any dealing
by the judgment debtors with the Land for such period as was appropriate for the judgment creditor
to move promptly to utilise the provisions with respect to writs of execution in subdiv 5 of Div 4 of
Pt 3 of the District Court Act. Such an order may reasonably have been required as ancillary to the
proper objective of preventing the recording of adverse dealings in the register before the recording
of a writ of execution against the Land on the application of the judgment creditor. Other examples
may be imagined.
[53] However, the order made in this case was different in its nature and effect. The effect
was to give Mr Rahme something in the nature of an additional security for payment of the
judgment debt, by denying to Mr Pelechowski and Ms Stephens the exercise of their proprietary
rights which otherwise had not been diminished by the recovery of a judgment itself. The order
operated without receipt of any undertaking by Mr Rahme expeditiously to pursue the remedies
provided by the District Court Act or the Bankruptcy Act. The importance, in such a situation,
of an undertaking to proceed expeditiously is emphasised in the joint judgment in Cardile v LED
Builders Pty Ltd.
[54] The restraint imposed by the District Court was to continue “until further order or payment
of the verdict”. The order was not so expressed as to operate in aid of recovery of so much of the
judgment debt as might be recouped upon a sale under a writ of execution. Nor, should Mr Rahme
have decided to pursue his rights under the Bankruptcy Act, was the order expressed as subjected
to rights of creditors under an insolvent administration of the affairs of the judgment debtors. The
submissions by the Registrar with respect to implied power should be rejected.
[footnotes omitted]

GUIDING PRINCIPLES FOR PROCEDURE
[1.80] The CPA sets out that the “overriding purpose of this Act and of the rules of court, in
their application to civil proceedings, is to facilitate the just, quick and cheap resolution of
the real issues in the proceedings”: s 56. The court must seek to give effect to the overriding
purpose when it exercises any power given to it by the CPA or by rules of court. A party
to proceedings is under a duty to assist the court to further the overriding purpose, and a
solicitor or barrister must not, by his or her conduct, cause his or her client to be put in breach
of this duty: s 56(4).
The court is to act in accordance with the dictates of justice in deciding whether to make
any order or direction for the management of proceedings, including orders for amendment
or adjournment: s 58. For the purpose of determining what are the dictates of justice in a
particular case, the court must have regard to the overriding purpose and the objects of case
management (ss 56 and 57) and may have regard to the matters set out in s 58(2)(b). These
matters include:
8
[1.80]
Introduction to Civil Procedure
Chapter 1
1.
the degree of difficulty or complexity to which the issues in the proceedings give rise;
2.
the degree of expedition with which the respective parties have approached the
proceedings, including the degree to which they have been timely in their interlocutory
activities; and
3.
the degree of injustice that would be suffered by the respective parties as a consequence
of any order or direction.
In addition, the CPA requires the court to implement its practices and procedures with the
object of eliminating delay. Section 59 requires the court to implement its practices and
procedures with the object of eliminating any lapse of time between the commencement of
proceedings and their final determination beyond that which is reasonably required for the
interlocutory activities necessary for the fair and just determination of the issues in dispute
between the parties and the preparation of the case for trial.
Finally, the CPA requires the court to implement its practices and procedures with the
object of resolving the issues between the parties in such a way that the cost to the parties is
proportionate to the importance and complexity of the subject matter in dispute: s 60. These
principles are discussed in more detail in Chapter 2.
ADVERSARIAL SYSTEM OF CIVIL LITIGATION
Main features of adversarial and inquisitorial systems
[1.90] The civil justice system exists in an adversarial model of litigation. The main features
of an adversarial model are:
• a party controlled dispute (ie, the parties define the dispute and present evidence and
argument);
• the use of precedent, procedural rules and laws of evidence;
• a reactive, impartial judge who acts as an umpire;
• a reliance on oral testimony which is adduced from witnesses and is subject to cross
examination. In addition, advocates use oral argument in the presentation of their case;
• the trial is the climactic end of the litigation process (and is distinct from the pre-​trial stages
of proceedings); and
• use of the trial transcript for an appeal.
The adversarial model is commonly contrasted to the inquisitorial model. An inquisitorial
model’s features are the following:
• The judge’s role is both proactive and inquisitive.
• The main sources of law are codes with commentary from legal scholars.
• There are minimal rules of courtroom practice.
• The emphasis is on documentary proof and not on cross-​examination.
• There is no rigid separation between trial and pre-​trial phases.
• There is no use of transcript to record court proceedings.
The features of an adversarial model are discussed in the following extract from an issues
paper prepared by the Australian Law Reform Commission when it conducted its Managing
[1.90]
9
Civil Procedure in New South Wales
Justice Inquiry: Australian Law Reform Commission Report 89, Managing Justice: A Review
of the Federal Civil Justice System (Sydney, 2000). This paper also recognises that, in practice,
both the adversarial and inquisitorial models have hybrid features. For example, coronial
inquests and commissions set up to inquire into a particular issue are inquisitorial models
within the NSW adversarial justice system.
Review of the Adversarial System of Litigation: Rethinking
the Federal Civil Litigation System
[1.100] Australian Law Reform Commission, Review of the Adversarial System of Litigation: Rethinking
the Federal Civil Litigation System, Issues Paper 20 (1997)
Legal “families”
[2.2] There are a number of dominant legal families that distinguish the various legal systems of the
world. Some derive from religion (for example, the Islamic and Talmudic legal systems), others are
associated with particular political and social ideologies (for example, common law, civil law and
socialist law). These families are not rigidly distinguished from each other but there are sufficiently
significant differences between them to define them, based on the following basic characteristics:
• objectives of the legal system
• source of law
• legal method.
The “adversarial”/​“inquisitorial” dichotomy
[2.3] The two legal families that have dominated, and continue to dominate, “western” legal systems
are the civil law and common law systems. The origins of the first lie in Roman Law and the code civil
of nineteenth century France, while the common law derives from medieval English civil society. The
transplantation of both legal families throughout the western world and beyond was assured by the
French and British empires.
[2.4] Many of the cardinal features of the two legal families are different: their separate developments
spanned many centuries. However, even as “ideal types” they are far from polar opposites. Both have
as their overall objective the establishment of systems for the just resolution of disputes and the
maintenance of social order. It is their means of achieving such ends which differ.
[2.5] In the legal systems of today there is no pure example of either the civil law or common
law system. All relevant legal systems in the western world are to greater or lesser degrees hybrids of
these two models or of other legal families. Nonetheless in order to be able accurately to characterise
the legal system that presently operates in Australia it is useful to outline some of the features that
distinguish the common law and civil law families.
[2.6] The essential features of the common law family include
• A concern to determine legal disputes according to their individual circumstances and related
judge-​made case law, rather than applying general statements of legal principle.
• Common law orthodoxy dictates that the source of law is to be found in the texts of individual
judgments. Modern common law legal systems however have substantial bodies of highly detailed
legislation which comprise the primary source of law.
• Common law applies to all legal persons including the state. Traditionally there is no division
between public and private law.
• An inductive form of legal reasoning is adopted whereby legal principle derives from the texts of
many single judgments.
• In the litigation system the trial is the distinct and separate climax to the litigation process.
• Court-​room practice may be subject to rigid and technical rules.
10
[1.100]
Introduction to Civil Procedure
Chapter 1
Review of the Adversarial System of Litigation: Rethinking the Federal Civil Litigation System cont.
• Proceedings are essentially controlled by the parties to the dispute and there is an emphasis on the
presentation of oral argument by counsel. The role of the judiciary is more reactive than proactive.
Given the parties’ opportunity and responsibility for mounting their own case the system is more
participatory.
• The judiciary possesses an inherent and separate power to adjudicate.
• The expense and effort of determination of disputes through litigation falls largely on the parties.
[2.7] The essential features of the civil law family include
• A concern to determine legal disputes according to pre-​determined legal principles established to
maintain social order.
• The source of law is to be found in authoritative statements of basic legal principles –​for example,
the Civil and Criminal Codes –​issued by the state and propounded upon by legal scholars.
• There is a separation of public law (concerning relations between the individual and the state) and
private law (between individuals).
• A deductive form of legal reasoning is adopted whereby pre-​existing general statements of legal
principle are applied to the specific circumstances of individual cases.
• In litigation no rigid separation exists between the stages of the trial and pre-​trial in court cases. Legal
proceedings are viewed as a continuous series of meetings, hearings and written communications
during which evidence is introduced, witnesses heard and motions made.
• Rules relating to court-​room practice are intended to be minimal and uncomplicated.
• The role played by lawyers is less conspicuous with an emphasis on written submissions rather than
oral argument. The role of the judiciary is both proactive and inquisitive. The greater directorial
role of the judiciary allows less room for the parties to direct their own case. In this sense the system
is more hierarchical than participatory.
• As officers of the state the judiciary possesses no separate and inherent power to adjudicate.
• A greater proportion of the effort and expense of dispute determination through litigation falls on
the state.
[2.8] It is the combination of these elements within each of the two families of common law and civil
law and their respective court procedures and practices which permit the short-​hand descriptors of
“adversarial” and “inquisitorial” to be used. In the classical adversarial form of trial:
the judge sits to hear and determine the issues raised by the parties, not to conduct an
investigation or examination on behalf of society at large …. So firmly is all this established
in our law that the judge is not allowed in a civil dispute to call a witness whom he thinks
might throw some light on the facts. He must rest content with the witnesses called by the
parties.
[2.9] The common law courtroom trial is a forum in which arguments of the disputing parties are
pitted against each other. As the trial is the climax to the litigation process, the “shadow” of the trial
affects the form and content of pre-​trial proceedings. The defining characteristic of adjudication in
common law systems is its adversarial nature, reflected in the practice and culture of litigation.
The origins of the Australian litigation system
[2.10] The origins of the legal system in Australia lie in medieval English civil society. The basic elements
of our legal system evolved during the reign of the Plantagenet Kings. There was no deliberate act of
creation of the system nor any defined moment of its coming into being. The common law system of
England took its form from a coalition of established practices and procedures.
[2.11] The fledgling common law system was flexible. The lawyers, judges and court officials who
administered it were pragmatists. These were instrumental factors in the resistance of the common
[1.100]
11
Civil Procedure in New South Wales
Review of the Adversarial System of Litigation: Rethinking the Federal Civil Litigation System cont.
law system to infiltration of the structured Roman law system. The common law system developed in
isolation from the civil law system in continental Europe. Through the expansion of the British Empire
the insular and arcane learning of the small band of lawyers who argued cases in the great hall
of Westminster became the law by which a third of the people on the earth were governed
and protected, the second of the two great systems of jurisprudence known to the world.
[2.12] A significant development in the formative decades of the common law system was the
institution of pleading. This feature of cases before common law courts is typical both of the
adaptability of the system and the prominent role played by the lawyers. At its simplest pleading
consisted of the defendant appearing at the bar of the court and the plaintiff stating the complaint.
This practice became more formal and professional “counters” or “narrators” the precursors to today’s
barristers practised the art of pleading. The nature of their professional expertise and the extent of
their assistance to the court and their “client” changed from the mere preparation and recitation
of the “count” (pleading) to more detailed argument and amplification of their “client’s” case. The
narrators’ expertise and guidance was now required not only by the bench but by non-​legally trained
jurors increasingly used in civil and criminal trials.
[2.13] Australia inherited the adversarial common law system of England. In conformity with the
laws of settlement at the time
as soon as the original settlers had reached the colony, their invisible and inescapable cargo
of English law fell from their shoulders and attached itself to the soil on which they stood.
The colony’s court systems, if not replicas of England’s, displayed their obvious parentage.
[footnotes omitted]

Reforms of the adversarial system of litigation
[1.110] There has been criticism of the adversarial system model on the grounds that it
prevents access to justice due to its cost (both private and public) and its delay. The system
has been criticised for being unjust, unequal and producing inaccurate results. These
criticisms resulted in a major review of the civil justice system in England and Wales by
Lord Woolf: Lord Woolf, Access to Justice: Interim Report to the Lord Chancellor on the
Civil Justice System in England and Wales (1995) and Final Report to the Lord Chancellor
on the Civil Justice System in England and Wales (1996). Lord Woolf’s main finding was
that the primary problem of the unrestrained civil adversarial culture was that it restricted
access to justice. Lord Woolf’s review recommended a number of reforms, such as early
settlement of disputes; greater use of alternative dispute resolution, single expert witnesses;
encouraging cooperation amongst lawyers; identification and reduction of issues as a basis
for case preparation; moving to trial as quickly as possible if settlement is not possible; and
use of overriding objectives in court rules. Lord Woolf’s central recommendations came into
effect with the enactment of the Civil Procedure Rules 1998. In 2009, Sir Rupert Jackson
was asked to review and make recommendations in respect of case management and costs
in order to promote access to justice at proportionate cost. Sir Rupert Jackson produced his
final report in 2009.1 His main recommendations were implemented in 2013. In Australia,
1
12
Jackson R, Review of Civil Litigation Costs: Preliminary Report (May 2009); Jackson R, Review of Civil Litigation
Costs: Final Report (December 2009).
[1.110]
Introduction to Civil Procedure
Chapter 1
the criticisms resulted in the Australian Law Reform Commission conducting its own inquiry
into the adversarial system: “Review of the Adversarial System of Litigation: Rethinking the
Federal Civil Litigation System”, ALRC 89 (1999).
Reforms of the civil justice system can be seen in, for example, the greater use of case
management (see Chapter 2) and alternative dispute resolution (see Chapter 4). However, the
level of reform of the civil justice system is regulated by the level of funding of the operation
of the system. The Victorian Law Reform Commission recently considered the impact of
resource allocation.
Civil Justice Review
[1.120] Victorian Law Reform Commission, Civil Justice Review, Report No 14 (2008) p 71
3.3 Resource allocation and distribution of civil and criminal cases
Funding is a critical factor affecting the operation of the civil justice system. The quantity of judicial
and other resources available to deal with cases will be an important determinant of the capacity
of the civil justice system to deal with the demands of litigants. The manner in which judicial and
other resources are deployed to deal with the competing demands of criminal cases will also directly
impact on the available resources to deal with civil cases. All three Victorian courts, and many judicial
officers within each court, deal concurrently with both civil and criminal cases. In a number of other
jurisdictions there have been moves to create separate specialist criminal and civil courts.
Apart from its impact on the level of judicial and other resources, funding will influence the quality
of judicial and other court personnel. Levels of remuneration and other factors, such as judicial
pensions, have a bearing on the calibre of candidates for judicial office and on the duration of their
period in office. The remuneration entitlements of judicial officers are significantly less than what may
be earned in private practice. However, non-​contributory judicial pensions may have an influence in
both attracting people to judicial office and accelerating their retirement. In considering the level of
public funding for the civil courts it is necessary to have regard to the fact that the courts generate
income, including through court fees and other charges for services. According to the Productivity
Commission, in the 2005–​06 financial year recurrent expenditure on court administration for the
civil courts in Victoria amounted to $86.3 million. In the same period, income derived through
the civil courts in Victoria, excluding fines, amounted to $33.9 million. In the 2006–​07 financial
year, the respective figures were $86.5 million and $34.6 million. In recent times there have been
increasing calls for users of the court system to pay more for the services provided, including in
commercial disputes between resourceful commercial entities.
Although the level of judicial and other resources available to deal with civil cases, and the
allocation of judicial and other resources between civil and criminal matters, are important factors
influencing the civil justice system these matters are outside the scope of stage one of the present
review. However, the commission accepts that “access to justice” is a qualified right. Governments
cannot reasonably be expected to provide unlimited publicly funded resources for the adjudication
of disputes, particularly private disputes that do not have significance beyond the interests of the
individual parties. From a policy perspective, there is a need to balance the “government’s duty to
use public funds responsibly”, including by making difficult decisions between competing priorities,
and the obligation of parties in dispute to “bear some responsibility for resolving their differences”.
The following observations of Professor Zuckerman have met with judicial approval in the UK (See,
eg, Sir Anthony Clarke, The Importance of Civil Justice: Nationally and Internationally (paper presented
at the American Bar Association Conference, London, 3 October 2007) 5 (quoting Zuckerman)).
The right of access to court does not, however, entitle litigants to demand the best possible
law enforcement process regardless of cost, any more than they are entitled to demand
unlimited health support or boundless educational facilities. The only reasonable demand
that members of the community can make with respect to any public service is that its
[1.120]
13
Civil Procedure in New South Wales
Civil Justice Review cont.
funding should be commensurate with available public resources and with the importance
of the benefits that it has to deliver. In addition, members of the community have a right to
expect that, within available resources, the service should provide adequate benefits to the
community.
The test of whether a given public service is adequate is fairly straight forward. A public
service is adequate if it is effective, efficient and fair. A service is effective if it meets the
reasonable expectations of the community, be they appropriate health service, a satisfactory
education system or, indeed, adequate court assistance for the enforcement of rights. A service
is efficient if its resources are used to maximise benefit output and are not unreasonably
wasted on unproductive activities. A service is fair if the resources available to it are justly
distributed between those entitled to the service, whether their needs are present or merely
contingent.
The requirements of effectiveness, efficiency and fairness are easily translated to the provision of court
dispute resolution. Court adjudication is effective if it determines claims with reasonable accuracy,
within a reasonable time and with proportionate investment of litigant and public resources. Court
adjudication is efficient if public and litigant resources are employed to maximise effectiveness and are
not wasted unnecessarily. Lastly, court adjudication is fair if the system ensures that its resources and
facilities are justly distributed between all litigants seeking court help and between present and future
litigants (Adrian Zuckerman, “Civil Litigation: A Public Service for the Enforcement of Civil Rights”
(2007) 26 Civil Justice Quarterly 1, [3]‌).
It would appear to be generally accepted that the goals of the civil justice system cannot be
pursued without some moderation, or pursued by unfair means or by exhausting every avenue of
inquiry. As Knight Bruce VC has noted: “Truth … may be loved unwisely –​may be pursued too
keenly –​may cost too much” (Pearse v Pearse (1846) 63 ER 950, 957).
[footnotes generally omitted]

“Cards on the table” approach to litigation
[1.130] Conducting litigation as if it were a card game is now discouraged in the adversarial
system. In Nowlan v Marson Transport Pty Ltd (2001) 53 NSWLR 116, Heydon JA said
at [26]:
The conduct of litigation as if it were a card game in which opponents never see some of
each other’s cards until the last moment is out of line with modern trends. Those trends were
developed because the expense of Courts to the public is so great that their use must be made
as efficient as is compatible with just conclusions. Civil litigation is too important an activity to
be left solely in the hands of those who conduct it.
Baulderstone Hornibrook Engineering v Gordian Runoff
[1.140] Baulderstone Hornibrook Engineering Pty Ltd v Gordian Runoff Ltd [2008] NSWCA 243
ALLSOP P (BEAZLEY and CAMPBELL JJA agreeing)
[160] Giving due weight to the realities of life in running a long and complex trial and the
vicissitudes of the appreciation of the evidence given, it cannot be emphasised too strongly that
it is the responsibility of the parties, through their legal representatives, to exercise a degree of
co-​operation to express the issues for trial before and during the trial. Such co-​operation can now be
taken as an essential aspect of modern civil procedure in the running of any civil litigation, including
hard-​fought commercial cases. The need for clarity, precision and openness as part of this co-​operation
14
[1.130]
Introduction to Civil Procedure
Chapter 1
Baulderstone Hornibrook Engineering v Gordian Runoff cont.
has been emphasised in the context of ambush or surprise: White v Overland [2001] FCA 1333 at
[4]‌, expressly approved in Nowlan v Marson Transport Pty Ltd [2001] NSWCA 346; 53 NSWLR 116
(Heydon JA, with whom Mason P and Young CJ in Eq agreed); Glover v Australian Ultra Concrete Floors
Pty Ltd [2003] NSWCA 80 at [59]-​[60] (Ipp JA, with whom Sheller and Hodgson JJA agreed); Sutton v
Erect Safe Scaffolding (Aust) Pty Ltd [2006] NSWCA 265 at [4] (Bryson JA with whom Basten JA agreed);
and Hooker v Gilling [2007] NSWCA 99 at [52] (McColl JA, with whom Ipp and Basten JJA agreed).
[161] The need for clarity, precision and openness in the conduct of litigation and the responsibility
of parties and their legal representatives therefor flows most clearly from the statutory duty of a
party and his, her or its legal representatives in civil proceedings to assist the Court to further the
overriding purpose to facilitate the just, quick and cheap resolution of the real issues in dispute and to
participate in the processes of the Court to that end: see Civil Procedure Act 2005 (NSW), 56. It may
be that the provision no more than restates the proper approach of the modern law of procedure
reflected in cases such as Nowlan v Marson Transport. It places the proper approach, however, on a
firm statutory foundation. These principles can be seen to be reflected in the longstanding rules of
pleading requiring any matter that may cause surprise to be pleaded.
[162] An enhanced requirement of clarity and disclosure in modern civil litigation can be seen in
Australia and England from at least the early 1990s: see the discussion of the “cards on the table”
approach by Ipp J (as his Honour then was) in Boyes v Colins [2000] WASCA 344; 23 WAR 123 (with
whom Pidgeon and Wallwork JJ agreed), citing Mercer v Chief Constable of the Lancashire Constabulary
[1991] 1 WLR 367 and Khan v Armaguard Ltd [1994] EWCA Civ 19; [1994] 1 WLR 1204. Indeed, from
the late 1970s and early 1980s, the Commercial List of this Court (in which List this hearing took
place) has been sought to be run on the strict basis of the clear and full enunciation of issues for trial,
in a way that has always demanded the fullest co-​operation among parties and legal practitioners to
delineate and illuminate the real issues in dispute.
[163] The clear statutory duty to assist the Court, and, in a practical way, to co-​operate to bring
forward the real issues in dispute, encompasses the requirement to be clear and precise in the
illumination of the issues for trial. The occasion for this is not merely pleading (using the word broadly
to encompass the modern commercial list summons and defence), it extends to all aspects of the
engagement in the Court’s processes. For similar responsibilities in the conduct of references, see
Bellevarde Constructions Pty Ltd v CPC Energy Pty Ltd [2008] NSWCA 228 at [55]-​[56].
[164] This does not deny the possibility, as occurs in real life in litigation, that issues will develop.
Litigation is a dynamic human activity. Changes in how a case is put can be expected. This often
occurs in large commercial cases. Such change, and the potential for it, makes it, however, all the more
important that legal practitioners and parties ensure that the clear enunciation of issues keeps pace
with that growth and change. This responsibility will encompass parties and their legal representatives
making clear what is being put and also what they regard as not legitimately part of the controversy,
if it is apparent to them that an issue not pleaded or presented is being relied on.

THE PRINCIPLE OF OPEN JUSTICE
[1.150] The principle of open justice is essential to the criminal and civil justice systems.
Spigelman CJ said in John Fairfax Publications Pty Ltd v District Court of NSW (2004) 61
NSWLR 344; [2004] NSWCA 324 at [18]:
It is well established that the principle of open justice is one of the most fundamental aspects of
the system of justice in Australia. The conduct of proceedings in public … is an essential quality
of an Australian court of justice. There is no inherent power of the court to exclude the public.
[1.150]
15
Civil Procedure in New South Wales
In R v Richards & Bijkerk (1999) 107 A Crim R 318 at 324, Spigelman CJ (James J and
Smart AJ agreeing) dismissed an appeal of a trial judge’s order that proceedings be held in
camera and stated:
[37] The paramount duty of the courts in administering justice according to law is to ensure
that justice is done. All else is subservient to the discharge of this duty. In the ordinary course,
court proceedings are conducted in public and exposed to the catharctic glare of publicity.
Publicity of proceedings is one of the great protections against the exercise of arbitrary power
and a reassurance that justice is administered fairly and impartially. As Lord Hewart put it in
R v Sussex Justices; Ex parte McCarthy [1924] 1 KB 256, “Justice must not only be done but
be seen to be done”.
[38] The courts should be open to all, so that anyone who wishes may see how justice is
done. The privilege belongs to the public generally and no special privilege is conferred on
those who report proceedings. In this regard I refer to the observations of Samuels JA in the
case of David Syme & Co Limited v General Motors Holden Limited (1984) 2 NSWLR 294
at 310 where his Honour said:
It is well established that in the ordinary course the courts will conduct their proceedings
in public. It is fundamental that the courts should be open to all, in order that all who are
minded to do so may see how justice is administered … that entitlement is not limited to those
who have business in the courts as litigants; nor, I myself would add, does it confer any special
privilege upon those who report proceedings for the press or electronic media. The privilege to
see what the courts do and say belongs to the public generally.
[39] It is only in wholly exceptional circumstances, where the presence of the public or
public knowledge of the proceedings is likely to defeat the paramount duty of the courts, that
the courts may proceed in camera.
[1.160] The court can depart from the principle of open justice in various ways. The court
can close the court to the public (ie, the proceedings are held in camera), or it can prohibit
publication of all or part of the proceedings. The court can also make orders permitting a
witness to give evidence behind a screen or via encrypted video-​link or closed circuit television
from a remote point; such orders can prevent the public and also the litigant/​s from identifying
a witness by sight and/​or sound. The court also has the power to make pseudonym orders to
protect the true identity of a witness.
The power to make orders to “close” justice can be the subject of specific legislation, for
example, s 71 of the CPA permits a judge to close the court to the public (see [1.250]), and
the Court Suppression and Non-​publication Orders Act 2010 provides for the making of
suppression and non-​publication orders (see [1.280]). Prior to the commencement of the 2010
Act, the power to make such non-​publication and/​or suppression orders was due to the court’s
inherent or implied jurisdiction (see [1.70]). The power to close proceedings in civil cases is
still due to the court’s inherent or implied jurisdiction and s 71 of the CPA.
Common law power to depart from the open justice principle
[1.170] In Scott v Scott [1913] AC 417 at 437, Viscount Haldane said in the House of Lords
that the “chief object of the courts of justice must be to secure that justice is done” and that “it
may well be that justice could not be done at all if it had to be done in public”.
The power to make orders to “close” justice is an inherent power of a superior court,
and in statutory courts, the power to make orders that depart from the principle of open
justice can be implied as necessary to the proper function of the court: John Fairfax Group
Pty Ltd v Local Court of NSW (1991) 26 NSWLR 131 at 161. The power of the court to
depart from the principle of open justice and make the orders described in [1.160] is on the
16
[1.160]
Introduction to Civil Procedure
Chapter 1
basis that such orders are “really necessary to secure the proper administration of justice”
in the proceedings: John Fairfax & Sons Pty Ltd v Police Tribunal (NSW) (1986) 5 NSWLR
465 at 477 per McHugh JA. The necessity for such measures would arise only in “wholly
exceptional” circumstances, not merely where such measures would be useful or desirable
(John Fairfax Publications Pty Ltd v Ryde Local Court (2005) 62 NSWLR 512 at 523 [45] per
Spigelman CJ), and would save embarrassment, distress or financial loss: Attorney-​General
(NSW) v Mayas Pty Ltd (1988) 14 NSWLR 342 at 347 per Mahoney JA.
The phrase “really necessary to secure the proper administration of justice” was considered
in John Fairfax Group Pty Ltd v Local Court of NSW (1991) 26 NSWLR 131 where the
Court of Appeal held that a Local Court magistrate hearing committal proceedings had the
implied power to make pseudonym orders protecting the identity of an alleged victim of
extortion. In that case Mahoney JA said at 161:
This leads to the consideration of what is meant by “necessary to secure the proper administration
of justice” in this context. The phrase does not mean that if the relevant order is not made, the
proceedings will not be able to continue. Plainly they can. If the name of an informer is not
hidden under a pseudonym, the proceeding will go on: at least, the instant proceeding will. And
if the name of a security officer is revealed, the administration of justice or of the country will
not collapse. The basis of the implication is that if the kind of order proposed is not made, the
result will be –​or at least will be assumed to be –​that particular consequences will flow, that
those consequences are unacceptable, and that therefore the power to make orders which will
prevent them is to be implied as necessary to the proper function of the court. The kinds of
consequences that, in this sense, will be seen as unacceptable may be gauged by those involved
in the cases in which statutory courts have been accepted as having restrictive powers. Thus,
there will be hardship on the informer or the security officer or the blackmail victim; the future
supply of information from such persons will end or will be impeded; and it will be more
difficult to obtain from such persons the evidence necessary to bring offenders before the courts
and deal with them.
Hogan v Hinch
[1.180] Hogan v Hinch (2011) 243 CLR 506; [2011] HCA 4
[Derryn Hinch, a radio broadcaster, was responsible for a website designated “HINCH.net”. In
September 2008, he was charged in the Magistrates Court of Victoria with five counts of contravening
three suppression orders made under s 42 of the Serious Sex Offenders Monitoring Act 2005 (Vic)
(“the Act”) in the County Court at Melbourne. The suppression orders prohibited publication of any
information that might enable the identification of certain persons, convicted of sex offences, who
were the subject of post-​custodial extended supervision orders under the Act. Mr Hinch’s offences
were said to have been committed when he named the persons on his website and at a public rally
in Melbourne. By way of defence to the charges, Mr Hinch unsuccessfully raised a constitutional
challenge to the validity of s 42. Mr Hinch submitted that s 42 was invalid because:
(i)
the jurisdiction or power conferred by s 42(1), to make “suppression orders” impermissibly
diminishes the “institutional integrity” of the courts of Victoria, contrary to the implied
requirements of Ch III of the Constitution; and
(ii)
the prohibitions imposed by the orders made under s 42 were contrary to an implication
derived from Ch III of the Constitution that all State and federal courts must be open to the
public and carry out their activities in public.]
FRENCH CJ
[20] An essential characteristic of courts is that they sit in public. [Daubney v Cooper [1829] EngR
48; (1829) 10 B & C 237 at 240 [109 ER 438 at 440]; Dickason v Dickason (1913) 17 CLR 50; [1913]
[1.180]
17
Civil Procedure in New South Wales
Hogan v Hinch cont.
HCA 77; Scott v Scott [1913] AC 417; Russell v Russell [1976] HCA 23; (1976) 134 CLR 495 at 520 per
Gibbs J; [1976] HCA 23.] That principle is a means to an end, and not an end in itself. Its rationale is
the benefit that flows from subjecting court proceedings to public and professional scrutiny [Russell v
Russell [1976] HCA 23; (1976) 134 CLR 495 at 520 per Gibbs J]. It is also critical to the maintenance
of public confidence in the courts. Under the Constitution courts capable of exercising the judicial
power of the Commonwealth must at all times be and appear to be independent and impartial
tribunals. The open-​court principle serves to maintain that standard. [Forge v Australian Securities
and Investments Commission [2006] HCA 44; (2006) 228 CLR 45 at 76 [64], 81 [78] per Gummow,
Hayne and Crennan JJ; [2006] HCA 44.] However, it is not absolute. [Bass v Permanent Trustee Co Ltd
[1999] HCA 9; (1999) 198 CLR 334 at 359 [56] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne
and Callinan JJ; [1999] HCA 9, adopting the remarks of Gaudron J in Harris v Caladine [1991] HCA 9;
(1991) 172 CLR 84 at 150; [1991] HCA 9, referring to “limited exceptions” to the open and public
inquiry involved in the exercise of judicial power.]
[21] It has long been accepted at common law that the application of the open justice principle
may be limited in the exercise of a superior court’s inherent jurisdiction or an inferior court’s implied
powers. [Inferior courts lack the “inherent jurisdiction” of superior courts, but have analogous implied
powers: Grassby v The Queen [1989] HCA 45; (1989) 168 CLR 1 at 15–​17 per Dawson J; [1989] HCA
45; John Fairfax Publications Pty Ltd v District Court (NSW) [2004] NSWCA 324; (2004) 61 NSWLR 344
at 354 [28] per Spigelman CJ, Handley JA and M W Campbell A-​JA agreeing at 368. In federal courts
created by statute implied incidental powers also take the place of “inherent jurisdiction”: DJL v Central
Authority [2000] HCA 17; (2000) 201 CLR 226 at 240–​241 [25] per Gleeson CJ, Gaudron, McHugh,
Gummow and Hayne JJ; [2000] HCA 17; Jackson v Sterling Industries Ltd [1987] HCA 23; (1987) 162
CLR 612 at 618–​619 per Wilson and Dawson JJ, 623–​624 per Deane J, Mason CJ agreeing at 616,
630–​631 per Toohey J; [1987] HCA 23.] This may be done where it is necessary to secure the proper
administration of justice. [John Fairfax & Sons Ltd v Police Tribunal (NSW) (1986) 5 NSWLR 465 at 476–​
477 per McHugh JA, Glass JA agreeing at 467.] In a proceeding involving a secret technical process, a
public hearing of evidence of the secret process could “cause an entire destruction of the whole matter
in dispute”. [Andrew v Raeburn (1874) LR 9 Ch 522 at 523. See also Nagle-​Gillman v Christopher (1876)
4 Ch D 173 at 174 per Jessel MR; Mellor v Thompson (1885) 31 Ch D 55; Scott v Scott [1913] AC 417
at 436–​437 per Viscount Haldane LC, 443 per Earl of Halsbury, 445 per Earl Loreburn, 450–​451 per
Lord Atkinson, 482–​483 per Lord Shaw of Dunfermline.] Similar considerations inform restrictions on
the disclosure in open court of evidence in an action for injunctive relief against an anticipated breach
of confidence. In the prosecution of a blackmailer, the name of the blackmailer’s victim, called as a
prosecution witness, may be suppressed because of the “keen public interest in getting blackmailers
convicted and sentenced” and the difficulties that may be encountered in getting complainants
to come forward “unless they are given this kind of protection”. [R v Socialist Worker Printers and
Publishers Ltd; Ex parte Attorney-​General [1975] QB 637 at 644 per Lord Widgery CJ, Milmo and
Ackner JJ agreeing at 653, referred to with apparent approval in Attorney-​General v Leveller Magazine
Ltd [1979] AC 440 at 452 per Lord Diplock, 458 per Viscount Dilhorne, 471 per Lord Scarman. See
also John Fairfax Group Pty Ltd v Local Court (NSW) (1991) 26 NSWLR 131 at 141 per Kirby P.] So too,
in particular circumstances, may the name of a police informant or the identity of an undercover
police officer. [Cain v Glass (No 2) (1985) 3 NSWLR 230 at 246 per McHugh JA; John Fairfax & Sons
Ltd v Police Tribunal (NSW) (1986) 5 NSWLR 465 at 472 per Mahoney JA, 480 per McHugh JA,
Glass JA agreeing at 467; John Fairfax Group Pty Ltd v Local Court (NSW) (1991) 26 NSWLR 131 at 141
per Kirby P, 159 per Mahoney JA, Hope A-​JA agreeing at 169; Herald & Weekly Times Ltd v Medical
Practitioners Board (Vic) [1999] 1 VR 267 at 293 [85]; R v Lodhi [2006] NSWCCA 101; (2006) 65
NSWLR 573 at 584 [25]–​[26] per McClellan CJ at CL.] The categories of case are not closed, although
they will not lightly be extended. [R v Kwok [2005] NSWCCA 245; (2005) 64 NSWLR 335 at 340–​
341 [12]–​[14] per Hodgson JA, 343–​344 [29]–​[31] per Howie J, 345–​346 [38]–​[39] per Rothman J;
Commissioner of Police (NSW) v Nationwide News Pty Ltd (2008) 70 NSWLR 643 at 648 [32]–​[38] per
Mason P, Ipp JA agreeing at 657, 658 [90]–​[91] per Basten J; P v D1 [No 3] [2010] NSWSC 644 at
[11]–​[20].] Where “exceptional and compelling considerations going to national security” require
18
[1.180]
Introduction to Civil Procedure
Chapter 1
Hogan v Hinch cont.
that the confidentiality of certain materials be preserved, a departure from the ordinary open justice
principle may be justified. [A v Hayden [1984] HCA 67; (1984) 156 CLR 532 at 599 per Deane J; [1984]
HCA 67; John Fairfax Group Pty Ltd v Local Court (NSW) (1991) 26 NSWLR 131 at 141 per Kirby P;
R v Lodhi [2006] NSWCCA 101; (2006) 65 NSWLR 573 at 584–​585 [26] per McClellan CJ at CL; R v
Governor of Lewes Prison; Ex parte Doyle [1917] 2 KB 254 at 271–​272 per Viscount Reading CJ; Taylor v
Attorney-​General [1975] 2 NZLR 675.] The character of the proceedings and the nature of the function
conferred upon the court may also qualify the application of the open-​court principle. The jurisdiction
of courts in relation to wards of the State and mentally ill people was historically an exception to the
general rule that proceedings should be held in public because the jurisdiction exercised in such cases
was “parental and administrative, and the disposal of controverted questions … an incident only in
the jurisdiction”. [Scott v Scott [1913] AC 417 at 437 per Viscount Haldane LC. See also John Fairfax
Publications Pty Ltd v Attorney-​General (NSW) [2000] NSWCA 198; (2000) 181 ALR 694 at 723 [165]
per Meagher JA.] Proceedings not “in the ordinary course of litigation”, such as applications for leave
to appeal, can also be determined without a public hearing. [Coulter v The Queen [1988] HCA 3;
(1988) 164 CLR 350 at 356 per Mason CJ, Wilson and Brennan JJ; [1988] HCA 3.]
[22] It is a common law corollary of the open-​court principle that, absent any restriction ordered
by the court, anybody may publish a fair and accurate report of the proceedings, including the
names of the parties and witnesses, and the evidence, testimonial, documentary or physical, that has
been given in the proceedings. [Attorney-​General v Leveller Magazine Ltd [1979] AC 440 at 450 per
Lord Diplock, 459 per Lord Edmund-​Davies, 469 per Lord Scarman; Raybos Australia Pty Ltd v Jones
(1985) 2 NSWLR 47 at 55 per Kirby P, 61 per Samuels JA; John Fairfax & Sons Ltd v Police Tribunal
(NSW) (1986) 5 NSWLR 465 at 476–​477 per McHugh JA, Glass JA agreeing at 467; Esso Australia
Resources Ltd v Plowman (1995) 183 CLR 10 at 43 per Toohey J; [1995] HCA 19; J v L & A Services Pty
Ltd (No 2) [1995] 2 Qd R 10 at 44 per Fitzgerald P and Lee J; Rogers v Nationwide News Pty Ltd [2003]
HCA 52; (2003) 216 CLR 327 at 335 [15] per Gleeson CJ and Gummow J; [2003] HCA 52; John Fairfax
Publications Pty Ltd v District Court (NSW) [2004] NSWCA 324; (2004) 61 NSWLR 344 at 353 [20] per
Spigelman CJ, Handley JA and MW Campbell A-​JA agreeing at 368.]
[23] The existence and nature of the common law or implied power in a court to make orders
restricting the publication of proceedings in open court has been the subject of considerable judicial
exegesis. The question whether the power extends to orders purporting to bind the world at large
is contentious. As the Law Reform Commission of New South Wales said in 2000: [New South Wales
Law Reform Commission, Contempt by publication, Discussion Paper No 43, (2000) at [10.20]]:
the common law regarding suppression orders is relatively unclear and unsettled.
However unsettled it may be, a consideration of the common law position with respect to suppression
orders is relevant to the question whether s 42 confers a function on courts of the State of Victoria
which is inconsistent with the essential characteristics of a court.
[24] On one view courts have no general authority to make orders binding non-​parties in their
conduct outside the courtroom. [Raybos Australia Pty Ltd v Jones (1985) 2 NSWLR 47 at 55, 57 per
Kirby P; John Fairfax & Sons Ltd v Police Tribunal (NSW) (1986) 5 NSWLR 465 at 477 per McHugh JA,
Glass JA agreeing at 467; “Mr C” (1993) 67 A Crim R 562 at 563 per Hunt CJ at CL, Smart and James JJ
agreeing at 566.] It has nevertheless been accepted that conduct outside the courtroom deliberately
frustrating the effect of an order made to enable a court to act effectively within its jurisdiction can
constitute a contempt of court. [John Fairfax & Sons Ltd v Police Tribunal (NSW) (1986) 5 NSWLR 465
at 477 per McHugh JA, Glass JA agreeing at 467; Attorney-​General (NSW) v Mayas Pty Ltd (1988)
14 NSWLR 342 at 355–​356 per McHugh JA, Hope JA agreeing at 344; Savvas (1989) 43 A Crim R
331 at 334 per Hunt J; United Telecasters Sydney Ltd v Hardy (1991) 23 NSWLR 323 at 333–​334 per
Samuels AP, Clarke and Meagher JJA agreeing at 348.]
[25] In 2004 the Privy Council held that there is no common law power to make orders against the
public at large prohibiting the reporting of open court proceedings. Such a power, it was said, must
be conferred by legislation. [Independent Publishing Co Ltd v Attorney-​General of Trinidad and Tobago
[1.180]
19
Civil Procedure in New South Wales
Hogan v Hinch cont.
[2004] EWCA Civ 844; [2005] 1 AC 190 at 216 [67].] On the other hand, it has been said in Australia
that there is at common law a limited power to prohibit publication of proceedings conducted in
open court. In Ex parte The Queensland Law Society Inc, [[1984] 1 Qd R 166 at 170] McPherson J, after
reviewing the authorities, said:
the power of the court under general law to prohibit publication of proceedings conducted
in open court has been recognized and does exist as an aspect of the inherent power. That
does not mean that it is an unlimited power. The only inherent power that a court possesses
is power to regulate its own proceedings for the purpose of administering justice; and, apart
from securing that purpose in proceedings before it, there is no power to prohibit publication
of an accurate report of those proceedings if they are conducted in open court, as in all but
exceptional cases they must be.
That statement was quoted with apparent approval by McHugh JA in John Fairfax & Sons Ltd v Police
Tribunal (NSW). [(1986) 5 NSWLR 465 at 479.] It was also approved in John Fairfax Publications Pty
Ltd v District Court (NSW). [[2004] NSWCA 324; (2004) 61 NSWLR 344 at 357 [42] per Spigelman CJ,
Handley JA and M W Campbell A-​JA agreeing at 368.] Doubts about the existence of such a power as
an element of the inherent jurisdiction or implied powers of courts have been expressed in Victoria.
[Re Applications by Chief Commissioner of Police (Vic) [2004] VSCA 3; (2004) 9 VR 275 at 288 [29];
General Television Corporation Pty Ltd v Director of Public Prosecutions [2008] VSCA 49; (2008) 19 VR 68
at 77 [29]; Herald and Weekly Times Pty Ltd v A [2005] VSCA 189; (2005) 160 A Crim R 299 at 305–​306
[27]–​[29].]
[26] In my opinion the better view is that there is inherent jurisdiction or implied power in limited
circumstances to restrict the publication of proceedings conducted in open court. The exercise
of the power must be justified by reference to the necessity of such orders in the interests of the
administration of justice. Such an order may be made to and bind the parties, witnesses, counsel,
solicitors and, if relevant, jurors and media representatives, or other persons present in court when the
order is made, or to whom the order is specifically directed. It is not necessary for present purposes to
reach a concluded view on the full extent of the power in relation to the general public.
[27] Beyond the common law, it lies within the power of parliaments, by statute, to authorise
courts to exclude the public from some part of a hearing or to make orders preventing or restricting
publication of parts of the proceeding or of the evidence adduced. [Russell v Russell [1976] HCA 23;
(1976) 134 CLR 495 at 520 per Gibbs J.] An example of such a law in the federal context is s 50 of the
Federal Court of Australia Act 1976 (Cth), recently considered by this Court in Hogan v Australian Crime
Commission. [(2010) 240 CLR 651; [2010] HCA 21.] Specific powers to make suppression orders or
orders for the exclusion of the public, where such orders are in the interest of security or defence of
the Commonwealth, can be found in the Crimes Act 1914 (Cth) [Crimes Act 1914 (Cth), s 85B] and the
Criminal Code (Cth) [Criminal Code (Cth), s 93.2]. There are many other examples of such provisions
enacted by State parliaments. [Court Suppression and Non-​
publication Orders Act 2010 (NSW),
ss 7, 8 … Witness Protection Act 1995 (NSW), s 26; Supreme Court Act 1986 (Vic), s 18; County Court Act
1958 (Vic), s 80; Magistrates’ Court Act 1989 (Vic), s 126; Evidence Act 1929 (SA), ss 69, 69A; Witness
Protection Act 1996 (SA), s 25; Children’s Protection Act 1993 (SA), s 59A; Supreme Court of Queensland
Act 1991 (Q), s 128; Child Protection Act 1999 (Q), ss 99ZG, 192, 193; Criminal Procedure Act 2004
(WA), s 171; Children’s Court of Western Australia Act 1988 (WA), s 35; Family Court Act 1997 (WA),
s 243; Evidence Act 1906 (WA), s 36C; Justices Act 1959 (Tas), s 106K; Terrorism (Preventative Detention)
Act 2005 (Tas), s 50; Evidence Act 2001 (Tas), s 194J.] Where it is left by statute to a court’s discretion
to determine whether or not to make an order closing part of a hearing or restricting the publication
of evidence or the names of parties or witnesses, such provisions are unlikely to be characterised as
depriving the court of an essential characteristic of a court and thereby rendering it an unfit repository
for federal jurisdiction. [See however, John Fairfax Publications Pty Ltd v Attorney-​General (NSW) [2000]
NSWCA 198; (2000) 181 ALR 694 in which the Court of Appeal held that a provision of the Supreme
Court Act 1970 (NSW) mandating in-​camera hearings of appeals against acquittals for contempt was
20
[1.180]
Introduction to Civil Procedure
Chapter 1
Hogan v Hinch cont.
consistent with the principles enunciated in Kable v Director of Public Prosecutions (NSW) (1996) 189
CLR 51; [1996] HCA 24 but infringed the implied freedom of political communication. The question
whether such a provision could survive Ch III scrutiny today may be regarded as open.] Nevertheless,
a statute which affects the open-​court principle, even on a discretionary basis, should generally be
construed, where constructional choices are open, so as to minimise its intrusion upon that principle.
That approach, which accords with the principle of legality, informs the construction of s 42 in this
case. The section must also be construed so as to minimise its intrusion upon common law freedom of
speech. The Charter requires that so far as it is possible to do so consistently with their purpose, such
provisions “must be interpreted in a way that is compatible with human rights” [Charter, s 32(1)].
Relevant human rights set out in Pt 2 of the Charter include the right to freedom of expression
[Charter, s 15(2)] and the right to participate in public life [Charter, s 18(1)]. There are other rights
which may be affected by a suppression order. They include the right of children to be protected
[Charter, s 17(2)] and the right of privacy [Charter, s 13(a)].
…
[45] The power conferred by s 42 to make suppression orders is conferred upon the Supreme and
County Courts of Victoria. They are, pursuant to Ch III of the Constitution and laws made under it,
part of a national integrated court system. They cannot validly be empowered or required to do things
which are “repugnant to or incompatible with the exercise of the judicial power of the Commonwealth”
[Kable v Director of Public Prosecutions (NSW) [1996] HCA 24; (1996) 189 CLR 51 at 104 per Gaudron J,
quoted with approval in Fardon v Attorney-​General (Qld) [2004] HCA 46; (2004) 223 CLR 575 at 617
[101] per Gummow J, Hayne J agreeing at 648 [198]]. That broad criterion of invalidity encompasses
functions which would be inconsistent with or inimical to the defining characteristics of a court, or
which deprive a court of one or other of those defining characteristics. A law which deprives a court
of the capacity to accord procedural fairness would fall into that category. [Leeth v The Commonwealth
[1992] HCA 29; (1992) 174 CLR 455 at 470; [1992] HCA 29; International Finance Trust Co Ltd v New
South Wales Crime Commission [2009] HCA 49; (2009) 240 CLR 319 at 355 [55] per French CJ, 366–​
367 [97]–​[98] per Gummow and Bell JJ; [2009] HCA 49.] So too would a law which places the court
at the behest of the executive or recruits the judicial function of the court to an essentially executive
process. [South Australia v Totani [2010] HCA 39; (2010) 85 ALJR 19; 271 ALR 662.]
[46] The open hearing is an essential characteristic of courts, which supports the reality and
appearance of independence and impartiality. Its corollary is the freedom to make a fair and accurate
report of what transpires in court proceedings, including the orders made by the court. However, at
common law the open justice principle has, consistently with the judicial function, long been subject
to qualifications reflected in the inherent jurisdiction of courts or their implied incidental power to
hear part of their proceedings in camera and to restrict the publication of evidence or the names of
witnesses. Chapter III does not impose on federal courts or the courts of the States a more stringent
application of the open justice principle than that described above. The extent at common law of
a power to prohibit publication of evidence or information disclosed in proceedings in open court
may be contentious. The existence of a power to make such orders to bind the world at large is
doubtful. Debate on that issue goes to the common law and implied powers of courts. Its resolution
does not conclude the question whether such a power is one which cannot be conferred by statute.
Having regard to the existence of analogous common law powers, albeit powers not as far reaching
as s 42, it cannot be said that that section confers upon the court functions inconsistent with its
essential curial characteristics or deprives it of those characteristics. Importantly, the section confers a
discretion on the court to decide whether or not to prohibit publication of certain information derived
from proceedings before it. It requires the court to apply familiar criteria in reaching that decision.
There is nothing in the nature of the power conferred upon the court by s 42, properly construed,
which is repugnant to or incompatible with the judicial function or otherwise incompatible with any
implication derived from Ch III.
GUMMOW, HAYNE, HEYDON, CRENNAN, KIEFEL and BELL JJ
…
[1.180]
21
Civil Procedure in New South Wales
Hogan v Hinch cont.
Institutional integrity
[80] As indicated earlier in these reasons, the power to make a “suppression order” is enlivened by
the satisfaction of the court that it is “in the public interest” to do so. That expression derives content
from the main purpose of the Act, which is identified in s 1(1). Section 42(3) does not present to
the court a criterion which is “so indefinite as to be insusceptible of strictly judicial application”.
[R v Commonwealth Industrial Court; Ex parte The Amalgamated Engineering Union, Australian Section
[1960] HCA 46; (1960) 103 CLR 368 at 383 per Kitto J; [1960] HCA 46.] Examples of criteria for the
exercise of the judicial power of the Commonwealth which have been stated in broad terms and held
valid are collected in Thomas v Mowbray [[2007] HCA 33; (2007) 233 CLR 307 at 344–​348 [71]–​[79],
509 [600], 526 [651]]. The criterion for the exercise of power under s 42 is not such as to impair
impermissibly the character of the State courts as independent and impartial tribunals and thus to
render them inappropriate repositories of federal jurisdiction.
…
Open justice
[85] However, the defendant then contends in his second submission that the restrictions imposed
by the three County Court orders could not be supported by s 42 because that law empowered the
court acting thereunder to act contrary to a requirement derived from Ch III that “all Federal and State
Courts must be open to the public”.
[86] In Dupas v The Queen [[2010] HCA 20; (2010) 241 CLR 237 at 243 [15]; [2010] HCA 20] the
Court observed:
Having regard both to the antiquity of the power and its institutional importance, there
is much to be said for the view that in Australia the inherent power to control abuse of
process should be seen, along with the contempt power, as an attribute of the judicial power
provided for in Ch III of the Constitution.
[87] An understanding of those and other attributes of the federal judicial power may be assisted by
the remarks of Isaacs J in R v Macfarlane; Ex parte O’Flanagan and O’Kelly [[1923] HCA 39; (1923) 32
CLR 518 at 549; [1923] HCA 39. See also Bass v Permanent Trustee Co Ltd [1999] HCA 9; (1999) 198
CLR 334 at 359 [56]; [1999] HCA 9]:
The final and paramount consideration in all cases is that emphasized in Scott v Scott [[1913]
AC 417 at 437], namely, “to do justice” (Viscount Haldane LC). All other considerations
are means to that end. They are ancillary principles and rules. Some of them are so deeply
embedded in our law as to be elementary and axiomatic, others closely approach that
position. Of the latter class is publicity, which can only be disregarded where necessity
compels departure, for otherwise justice would be denied to those whom Earl Loreburn
[[1913] AC 417 at 446] termed “the parties entitled to justice”.
[88] Some care is required here. First, the present issue does not concern the authority of the courts
by further decision to add to those situations where the necessity spoken of by Isaacs J compels
departure from the requirement that justice be administered publicly. In Scott v Scott [[1913] AC
417 at 437–​438], Viscount Haldane LC recognised the diverse and special cases which arose in the
wardship and lunacy jurisdictions and in disputes respecting trade secrets. Secondly, there are to be
distinguished from the power of courts to close their proceedings, rules of evidence which confer
an immunity against disclosure in court of certain communications made in the public interest [see
Cain v Glass (No 2) (1985) 3 NSWLR 230 at 246–​248 per McHugh JA]. Thirdly, in order to resolve the
present issue it is unnecessary to accept that there is an inherent jurisdiction or implied power in some
circumstances to restrict the publication of proceedings conducted in open court. Fourthly, the focus
of the present case is not upon the inherent powers of the courts or exclusionary rules of evidence, but
upon the competence of the Victorian legislature to confer upon Victorian courts the power provided
in s 42 of the Act.
22
[1.180]
Introduction to Civil Procedure
Chapter 1
Hogan v Hinch cont.
[89] It is here that the argument by the defendant breaks down. The powers of the Parliament
of the Commonwealth are conferred by the Constitution subject to Ch III. They extend to
furnishing courts exercising federal jurisdiction with authorities incidental to the exercise of the
judicial power [R v Kirby; Ex parte Boilermakers’ Society of Australia [1956] HCA 10; (1956) 94 CLR
254 at 269–​270; [1956] HCA 10; APLA Ltd v Legal Services Commissioner (NSW) [2005] HCA 44;
(2005) 224 CLR 322 at 407-​408 [234]-​[235]; [2005] HCA 44]. Thus, while s 17 of the Federal
Court of Australia Act 1976 (Cth) requires the jurisdiction of that Court to be exercised in open
court, that is qualified by s 50, which empowers the Court in certain circumstances to forbid or
restrict the publication of evidence. [See Hogan v Australian Crime Commission [2010] HCA 21;
(2010) 240 CLR 651.]
[90] A further example of federal legislation of that character was s 97(1) of the Family Law Act
1975 (Cth) (“the Family Law Act”), held invalid in Russell v Russell [(1976) 134 CLR 495; [1976]
HCA 23]. The sub-​section required the hearing in closed court of all proceedings under that statute,
whether in the Family Court of Australia or the Supreme Court of a State or Territory. The High Court
was dealing with pending causes removed from the Supreme Courts of Victoria and South Australia.
Gibbs J said that to require a court invariably to sit in closed court was to alter an essential aspect of
its character [[1976] HCA 23; (1976) 134 CLR 495 at 520]. But his Honour added [[1976] HCA 23;
(1976) 134 CLR 495 at 520]:
Of course there are established exceptions to the general rule that judicial proceedings shall
be conducted in public; and the category of such exceptions is not closed to the Parliament.
The need to maintain secrecy or confidentiality, or the interests of privacy or delicacy, may
in some cases be thought to render it desirable for a matter, or part of it, to be held in
closed court. If the [Family Law Act] had empowered the Supreme Courts when exercising
matrimonial jurisdiction to sit in closed court in appropriate cases I should not have thought
that the provision went beyond the power of the Parliament. In requiring them to sit in
closed court in all cases –​even proceedings for contempt –​the Parliament has attempted to
obliterate one of their most important attributes. This it cannot do.
[91] This reasoning should be followed here and has three consequences. First, it denies any
restriction drawn from Ch III which in absolute terms limits the exercise of the legislative power
of the Parliament. Secondly, it indicates that a federal law to the effect of s 42 would be valid
and would not deny an essential characteristic of a court exercising federal jurisdiction. Thirdly,
this being so, as a State law s 42 does not attack the institutional integrity of the State courts
as independent and impartial tribunals in the sense discussed in International Finance Trust and
Totani.
[The High Court declared that s 42 of the Serious Sex Offenders Monitoring Act 2005 (Vic) is not
invalid upon any of the grounds asserted in submissions to this Court.]

Common law categories of cases that are exceptions to the open justice
principle
[1.200] Exceptions to the principle of open justice are valid in few categories of cases in
the common law. The exceptions are “strictly defined”: R v Tait (1979) 46 FLR 386 at 401;
McPherson v McPherson [1936] AC 417 at 200; Russell v Russell (1976) 134 CLR 495; John
Fairfax Group Pty Ltd v Local Court of NSW (1991) 26 NSWLR 131 at 141; John Fairfax
Publications Pty Ltd v District Court of NSW (2004) 61 NSWLR 344 at 353 [19], 357 [45],
and courts are loathe to expand the field: Raybos Australia Pty Ltd v Jones (1985) 2 NSWLR
47 at 55.
[1.200]
23
Civil Procedure in New South Wales
The well-​established categories are:
• to protect the identity of an informer (see Cain v Glass (No 2) (1985) 3 NSWLR 230;
Arthur Stanley Smith (1996) 86 A Crim R 309; Witness v Marsden (2000) 49 NSWLR
429 (see extract at [1.210])). The reason for allowing exceptions to open justice in cases
of victims or informers is not out of tenderness towards the victim or the informer but
because experience has shown that such complainants or witnesses will not come forward
unless they are given some protection: R v Savvas (1989) 43 A Crim R 331 at 336; R v CAL
(1993) 67 A Crim R 562 at 564.
• to protect the identity of victims of blackmail (see R v Socialist Worker Printers & Publishers
Ltd; Ex Parte Attorney-​General [1975] QB 637).
• to protect matters of national security (see generally Mirror Newspapers Ltd v Waller
(1985) 1 NSWLR 1 at 19D per Hunt J; John Fairfax Group Pty Ltd v Local Court of
NSW (1991) 26 NSWLR 131 at 159F per Mahoney JA; John Fairfax Publications Pty Ltd
v District Court of NSW (2004) 61 NSWLR 344 at 357–​358 [45]–​[48] per Spigelman CJ;
BUSB v R [2011] NSWCCA 39 at [36]).
Witness v Marsden
[1.210] Witness v Marsden (2000) 49 NSWLR 429
[A witness attending a defamation trial, pursuant to a subpoena to give evidence, applied for a
pseudonym order because he held fears for his physical safety if his identity was made public. The
witness was a gaol inmate. The witness’ fear arose from his belief that if it became known in the prison
population that he gave evidence in the trial he would be subject to adverse and hostile treatment.]
HEYDON JA (MASON P and PRIESTLY JA agreeing)
[125] … The cases about “informers” which have developed since Marks v Beyfus (1890) 25 QBD 494
generally related to orders preventing the tender of documents, or testimony by persons other than
the informer, which could reveal the name of an informer. It does not matter that here the Witness is
not a person whose testimony might reveal the name of some other informer as distinct from his own.
Nor, though the plaintiff contended that the “informer” cases only applied to “registered informants”
as distinct from a person who informs in a general sense against another person (cf McHugh JA in Cain
v Glass (No 2) (1985) 3 NSWLR 230 at 251, who said the principle extended beyond “people who
are in effect professional informers and who provide information on a regular basis”), does it matter
whether the Witness is an informer in the narrow or the general sense. The point is that the informer
cases recognise the reality of the risks faced by those who give information to police, whether they
do so as professional informers or merely do so in isolated instances, like those giving evidence in
extortion or blackmail cases. Normally the informers the subject of those risks are outside gaol. The
risks are obviously greater for those inside gaol. The Witness’s evidence about his fears and their basis
gave exceptionally concrete and vivid support for the inferences which, according to Mahoney JA,
the law draws in any event. In short, Levine J’s Judgment has not given sufficient weight to the fact
accepted by the cases that informers generally are placed in dangerous positions by their activities.
“Dogs” in gaols are in a worse position than other informers. …
…
[144] It is necessary that there be a minimalist interference with open justice to the extent of
pseudonym orders in favour of the Witness. That is because without them the Witness reasonably
fears death or physical injury, or alternatively an unnecessary loss of liberty. These are evils which
it is necessary to avoid by that degree of minimalist interference. Without the orders, the Witness
is exposed to hurt, and the party calling him is faced with the risk of testimony proceeding from a
person who is reluctant, but in a particular sense. Many witnesses, as the plaintiff pointed out, are
reluctant, but few are reluctant because of fears for their lives, safety or liberty.
24
[1.210]
Introduction to Civil Procedure
Chapter 1
Witness v Marsden cont.
[145] It is perhaps unnecessary to say that the conclusion that pseudonym orders should be made
in relation to the Witness does not entail the further conclusion that they should be made in relation
to any prisoner serving a sentence whom it is desired to call as a witness in proceedings. Each case
must turn on its own circumstances, and the circumstances affecting the Witness in relation to these
unusual proceedings are out of the ordinary.
…
[153] The orders of the court are as follows:
…
4.
The Witness is to be addressed and referred to in the court only by a pseudonym.
5.
Any matter which is likely to lead to the identification of the Witness is not to be reported by
those in court.
6.
No photographs, film or video recording is to be taken of the Witness in the court or within its
precincts, and no drawings or other likenesses are to be made of the Witness either in the court
or within its precincts.
[The above order would now be sought under the Court Suppression and Non-​publication Orders
Act 2010.]

Seven Network (Operations) Ltd v Warburton (No 1)
[1.230] Seven Network (Operations) Ltd v Warburton (No 1) [2011] NSWSC 385
PEMBROKE J
[1]‌ This is an application by the plaintiffs to restrict access to confidential information contained
in four documents. It involves consideration of a fundamental tenet upon which our system of justice
operates, namely, the principle of open justice. That principle is one of the most important aspects
of our system of justice and an essential feature of the judicial process: John Fairfax Publications Pty
Limited v The Attorney-​General for the State of New South Wales [2000] NSWCA 198 at [52]–​[57]
(Spigelman CJ). It informs and vitalises numerous specific rules and practices.
Principle of Open Justice
[2]‌ The reason for the principle of open justice is that, if the proceedings of courts of justice are
fully exposed to public and professional scrutiny and criticism, and interested observers are able to
follow and comprehend the evidence, the submissions and the reasons for judgment, then the public
administration of justice will be enhanced and confidence in the integrity and independence of the
courts will be maintained: Russell v Russell; Farrelly v Farelly [1976] HCA 23; (1976) 134 CLR 495 at
520 (Gibbs J). Not only does the conduct of proceedings publicly and in open view assist in removing
doubts and misapprehensions about the operation of the system, but it also limits the opportunity for
abuse and injustice by those involved in the process, by making them publicly accountable. Equally,
public scrutiny operates as a disincentive to false allegations and as a powerful incentive to honest
evidence: J v L & A Services Pty Ltd (No 2) [1995] 2 Qd R 10 at 45 (Fitzgerald P and Lee J). For all those
reasons, the principle of open justice is not only an indispensable feature of our system, but it is also
a healthy feature.
[3]‌ There are limited exceptions to the principle of open justice. Where those exceptions apply,
the courts will restrict access where appropriate. But departure from the principle of open justice is
only justified where observance of the principle would in fact frustrate the administration of justice by
unfairly damaging some material private or public interest. To that end, an order restricting the public
availability of information will only be made if it is really necessary to secure the proper administration
[1.230]
25
Civil Procedure in New South Wales
Seven Network (Operations) Ltd v Warburton (No 1) cont.
of justice. Such an order must be clear in its terms and do no more than is necessary to achieve the
due administration of justice. Furthermore, there must be some material before the Court upon which
it can reasonably reach the conclusion that it is actually necessary to make an order of that type: John
Fairfax & Sons Ltd v Police Tribunal of New South Wales (1986) 5 NSWLR 465 at 476–​7 (McHugh JA);
Caroona Coal Action Group Inc v Coal Mines Australia Pty Ltd (No 4) [2010] NSWLEC 91 (Preston CJ);
Idoport Pty Ltd v National Australia Bank [2001] NSWSC 1024 (Einstein J).
[4]‌ The consequence of the principle of open justice is that embarrassing, damaging and
inconvenient facts may occasionally come to light. That consideration has never been regarded as a
reason in itself for the suppression of evidence or for an order restricting access to documents: John
Fairfax Group Pty Ltd (Receivers & Managers Appointed) v Local Court of New South Wales & Ors (1991)
26 NSWLR 131 at 142 (Kirby P). Equally, it is common for sensitive issues to be litigated and for
information that is extremely personal or confidential to be disclosed. This is sometimes an unavoidable
by-​product, and a necessary consequence, of the application of the principle.
[5]‌ To avoid the consequences that sometimes follow from the conduct of proceedings publicly and
in open view, parties can, and frequently do, choose to litigate their disputes by private commercial
arbitration. But if they choose to litigate in court, they must accept the necessity for the Court to
conduct its proceedings openly and with transparency.
Confidential Information
[6]‌ Nonetheless, as I have mentioned, there are established exceptions to the principle of open justice
and transparency. One of those exceptions is the protection of trade secrets and genuinely confidential
information that might assist competitors. If it were otherwise, the operation of the system of justice
may result in injustice to a person or entity whose legitimate confidentiality is exposed and infringed.
[7]‌ Whether information is confidential is a question of fact. Some of the criteria that are frequently
relevant to the resolution of that factual question include whether the employee has acknowledged
that the information is confidential or whether it was plainly made known to him that the employer
regarded it as confidential; whether skill and effort were expended to acquire the information; whether
the information is jealously guarded by the employer and not made readily available to all employees;
and whether the usages and practices of the industry support the assertion of confidentiality: Wright
v Gasweld Pty Ltd (1991) 22 NSWLR 317 at 334 (Kirby P). Sometimes, of course, the sensitive and
confidential nature of the information, and the advantage to competitors if it is disclosed, will be
immediately apparent on the face of the document.
[8]‌ If it is proved that documents were created in circumstances of confidentiality and that
the confidentiality has been retained and is maintained, and if it is clear that the publication of
the information in the documents will provide an advantage to competitors and be damaging to the
party seeking to restrict access, then the case for invoking one of the exceptions to the principle of
open justice will be made out. But the onus of demonstrating the confidentiality of the information
rests squarely on the party seeking to restrict access. And as I said, the restriction must be no more
than is necessary to avoid an injustice.
The Documents
[9]‌ In this case the plaintiffs seek to impose restrictions on access to four commercial documents.
The first is a management equity participation deed dated 10 December 2007. The plaintiffs seek to
restrict access to the whole of that document except for sections 1, 2, 3, 4, 17, 18, 20 and 22. Only
those sections have been referred to in the openings and, I have been informed, only those sections
will be referred to in the course of cross-​examination or submissions. It follows that it will only be
necessary for me to refer to those sections in my judgment. It will not be necessary for interested
persons to have access to other sections in order to understand my reasons.
[10] The content of the deed deals with the detail of the equity participation scheme which
operates for the benefit of senior executives and management in the Seven Network Group. Each
of the parties to the deed has expressly agreed that it is confidential. Each agreed not to disclose
26
[1.230]
Introduction to Civil Procedure
Chapter 1
Seven Network (Operations) Ltd v Warburton (No 1) cont.
its contents or its effect except in limited circumstances. It is obvious that if the deed were not kept
confidential, it could enable competitors of the Seven Network Group to understand the incentive
arrangements which operate with the group and the remuneration levels of senior management. This
private information might facilitate the poaching of staff -​an apparent feature of the industry. For
those reasons it seems to me appropriate that I accede to the application and restrict access to all but
the sections which have been identified.
[11] The second document is a proprietary document of Kohlberg Kravis Roberts & Co L P (KKR).
It is unique to that firm. KKR is a private equity investment firm that has a substantial economic
interest in the Seven Network Group. The document is described as an illustrative management equity
plan dated 12 December 2006. It is a statement of the factors and considerations that KKR uses in
connection with the standard form of management equity participation plan which it customarily
proposes when making investments as part of its global business as a private equity investor. In
this case, the illustrative plan belonging to KKR has no direct relevance to the issues in dispute,
other than that it preceded, and formed the basis of, certain provisions of the management equity
participation deed to which senior management subscribed. I accept that this document should be
kept confidential. No useful purpose would be served by making it available and harm to KKR may
result if access to it were not restricted.
[12] The third document is a term sheet dated 15 December 2006. It is not in final form. It
preceded the management equity participation deed and sets out certain principal terms which
were proposed to be implemented in the final deed. Those principal terms were included for
discussion purposes prior to any binding agreement being made. The term sheet is indicative,
among other things, of the importance placed by KKR on the inclusion in a management equity
plan of non-​compete restraints on senior executives preventing any post-​employment competition
against their employer. What is of primary importance in this case are the terms of the restraints
against competition as they were finally agreed and included in Seven’s management equity
participation deed. The term sheet by itself is of no particular relevance, but its contents are
confidential and should remain so.
[13] The fourth document is a list of 53 employees of the Seven Network’s management team
who were proposed to be approached to become participants in the management equity plan. The
list of employees includes reference to the total remuneration of each of them and their management
equity participation level. No useful purpose would be served by making this confidential information
publicly available. Unwarranted harm may well ensue if it were made available. Nearly all of the names
on the list are not persons involved in the issues in this case. But even the information in relation to
Mr Leckie, Mr Warburton and one or two others who are witnesses is of limited relevance and need
not be made available in the interests of justice.
Conclusion
[14] For those reasons I will make the orders for confidentiality sought by the plaintiffs in relation to
those four documents.
[The above order would now be sought under the Court Suppression and Non-​publication Orders
Act 2010.]

Statutory power to close the court in civil proceedings
[1.240] The CPA makes provision for the court to make an order to close the court (s 71) in
civil proceedings. Section 71 was applied by Barrett J in Re HIH Insurance Ltd [2007] NSWSC
[1.240]
27
Civil Procedure in New South Wales
498 to close the court on the application of the liquidators of insolvent HIH companies
(extracted at [1.260]).
Civil Procedure Act 2005 (NSW)
[1.250] Civil Procedure Act 2005 (NSW) s 71
71 Business in the absence of the public
Subject to any Act, the business of a court in relation to any proceedings may be conducted in the
absence of the public in any of the following circumstances:
(a)
on the hearing of an interlocutory application, except while a witness is giving oral evidence,
(b)
if the presence of the public would defeat the ends of justice,
(c)
if the business concerns the guardianship, custody or maintenance of a minor,
(d)
if the proceedings are not before a jury and are formal or non-​contentious,
(e)
if the business does not involve the appearance before the court of any person,
(f)
if, in proceedings in the Equity Division of the Supreme Court, the court thinks fit,
(g)
if the uniform rules so provide.

Re HIH Insurance
[1.260] Re HIH Insurance Ltd [2007] NSWSC 498
BARRETT J
[1]‌I have before me an application under s 71 of the Civil Procedure Act 2005 for an order that the
applications in the HIH matters listed for hearing this morning be dealt with in the absence of the
public. The application is made on the basis of s 71(b) which permits such an order to be made “if
the presence of the public would defeat the ends of justice”.
[2]‌The substantive applications involve directions to liquidators and other relief concerned
with the progress of and steps to be taken in litigation, in which the companies in liquidation are
involved. Both Mr McGrath and Mr Honey, as the liquidators of all the companies, and Mr Parbery
as the special purpose liquidator of the two FAI companies, have formed and conveyed to the
court a view that if the evidence intended to be adduced by them was made available to any of
the defendants to the litigation concerned, the ability of the liquidators to advantageously pursue
or conclude the claims for the benefit of the creditors of the relevant companies would be likely to
be significantly prejudiced. …
[4]‌ … The liquidators accept that there is a strong and clear public interest in open justice and that
except in exceptional circumstances, proceedings should take place in public.
[5]‌Today, as on the previous occasions, there are two other public interests competing with the
public interest in open justice. The first is the public interest in the due and beneficial administration
of the estates of insolvent companies by liquidators appointed by and answerable to the court, that
administration being for the benefit of creditors. I previously observed that the public interest in the
due administration of the insolvent estates of the HIH companies is particularly pronounced when
there are many thousands of creditors from all walks of life.
[6]‌The second competing or countervailing public interest arises from the fact that applications
before me relate to the pursuit of litigation. There is a clear public interest in the due administration
of justice, in that in litigation in the normal course an ordinary litigant would keep close to the chest,
as it were, the matters that the liquidators, because of their position, see fit to bring to court. The
28
[1.250]
Introduction to Civil Procedure
Chapter 1
Re HIH Insurance cont.
liquidators, because of their position, should not be set aside from other litigants and be placed to
a disadvantage when, as I say, they are acting for the benefit of many thousands of creditors whose
interests are very much to the fore.
[7]‌As I have said, the position now before me is the same as that which was before me on 20 July
2005. In each of the proceedings in the list today therefore I make an order, pursuant to s 71 of the
Civil Procedure Act 2005, that the hearing of the interlocutory process listed for hearing be conducted
in the absence of the public.

Statutory power to make suppression and non-​publication orders
[1.270] The Court Suppression and Non-​publication Orders Act 2010 (NSW) commenced
on 1 July 2011 and provides for the making of suppression and non-​publication orders by
courts. Sections 7 and 8 set out the power and grounds for making such orders. Contravention
of a suppression order or non-​publication order constitutes an offence.
Court Suppression and Non-​Publication Orders Act 2010
[1.280] Court Suppression and Non-​Publication Orders Act 2010 (NSW) ss 3–​12, 16
3 Definitions
In this Act:
“court” means:
(a)
the Supreme Court, Land and Environment Court, Industrial Court, District Court, Local Court
or Children’s Court, or
(b)
any other court or tribunal, or a person or body having power to act judicially, prescribed by
the regulations as a court for the purposes of this Act.
“information” includes any document.
“news media organisation” means a commercial enterprise that engages in the business of
broadcasting or publishing news or a public broadcasting service that engages in the dissemination
of news through a public news medium.
“non-​publication order” means an order that prohibits or restricts the publication of information
(but that does not otherwise prohibit or restrict the disclosure of information).
“party” to proceedings includes the complainant or victim (or alleged victim) in criminal proceedings
and any person named in evidence given in proceedings and, in relation to proceedings that have
concluded, means a person who was a party to the proceedings before the proceedings concluded.
“proceedings” means civil or criminal proceedings.
“publish” means disseminate or provide access to the public or a section of the public by any
means, including by:
(a)
publication in a book, newspaper, magazine or other written publication, or
(b)
broadcast by radio or television, or
(c)
public exhibition, or
(d)
broadcast or publication by means of the Internet.
“suppression order” means an order that prohibits or restricts the disclosure of information (by
publication or otherwise).
[1.280]
29
Civil Procedure in New South Wales
Court Suppression and Non-Publication Orders Act 2010 cont.
4 Inherent jurisdiction and powers of courts not affected
This Act does not limit or otherwise affect any inherent jurisdiction or any powers that a court has
apart from this Act to regulate its proceedings or to deal with a contempt of the court.
5 Other laws not affected
This Act does not limit or otherwise affect the operation of a provision made by or under any other
Act that prohibits or restricts, or authorises a court to prohibit or restrict, the publication or other
disclosure of information in connection with proceedings.
Part 2 –​Suppression and non-​publication orders
6 Safeguarding public interest in open justice
In deciding whether to make a suppression order or non-​publication order, a court must take into
account that a primary objective of the administration of justice is to safeguard the public interest in
open justice.
7 Power to make orders
A court may, by making a suppression order or non-​publication order on grounds permitted by this
Act, prohibit or restrict the publication or other disclosure of:
(a)
information tending to reveal the identity of or otherwise concerning any party to or witness
in proceedings before the court or any person who is related to or otherwise associated with
any party to or witness in proceedings before the court, or
(b)
information that comprises evidence, or information about evidence, given in proceedings
before the court.
8 Grounds for making an order
(1)
(2)
A court may make a suppression order or non-​publication order on one or more of the
following grounds:
(a)
the order is necessary to prevent prejudice to the proper administration of justice,
(b)
the order is necessary to prevent prejudice to the interests of the Commonwealth or a
State or Territory in relation to national or international security,
(c)
the order is necessary to protect the safety of any person,
(d)
the order is necessary to avoid causing undue distress or embarrassment to a party to
or witness in criminal proceedings involving an offence of a sexual nature (including
an act of indecency),
(e)
it is otherwise necessary in the public interest for the order to be made and that public
interest significantly outweighs the public interest in open justice.
A suppression order or non-​publication order must specify the ground or grounds on which
the order is made.
9 Procedure for making an order
(1)
(2)
30
A court may make a suppression order or non-​publication order on its own initiative or on the
application of:
(a)
a party to the proceedings concerned, or
(b)
any other person considered by the court to have a sufficient interest in the making of
the order.
Each of the following persons is entitled to appear and be heard by the court on an application
for a suppression order or non-​publication order:
[1.280]
Introduction to Civil Procedure
Chapter 1
Court Suppression and Non-Publication Orders Act 2010 cont.
(a)
the applicant for the order,
(b)
a party to the proceedings concerned,
(c)
the Government (or an agency of the Government) of the Commonwealth or of a
State or Territory,
(d)
a news media organisation,
(e)
any other person who, in the court’s opinion, has a sufficient interest in the question
of whether a suppression order or non-​publication order should be made.
(3)
A suppression order or non-​publication order may be made at any time during proceedings or
after proceedings have concluded.
(4)
A suppression order or non-​publication order may be made subject to such exceptions and
conditions as the court thinks fit and specifies in the order.
(5)
A suppression order or non-​publication order must specify the information to which the order
applies with sufficient particularity to ensure that the order is limited to achieving the purpose
for which the order is made.
10 Interim orders
(1)
If an application is made to a court for a suppression order or non-​publication order, the court
may, without determining the merits of the application, make the order as an interim order to
have effect, subject to revocation by the court, until the application is determined.
(2)
If an order is made as an interim order, the court must determine the application as a matter
of urgency.
11 Where an order applies
(1)
A suppression order or non-​publication order applies only to the disclosure or publication of
information in a place where the order applies, as specified in the order.
(2)
A suppression order or non-​publication order is not limited to applying in New South Wales
and can be made to apply anywhere in the Commonwealth.
(3)
However, an order is not to be made to apply outside New South Wales unless the court is
satisfied that having the order apply outside New South Wales is necessary for achieving the
purpose for which the order is made.
12 Duration of orders
(1)
A suppression order or non-​publication order operates for the period decided by the court and
specified in the order.
(2)
In deciding the period for which an order is to operate, the court is to ensure that the order
operates for no longer than is reasonably necessary to achieve the purpose for which it
is made.
(3)
The period for which an order operates may be specified by reference to a fixed or ascertainable
period or by reference to the occurrence of a specified future event.
16 Contravention of order
(1)
A person commits an offence if the person engages in conduct that constitutes a contravention
of a suppression order or non-​publication order and is reckless as to whether the conduct
constitutes a contravention of a suppression order or non-​publication order.
Maximum penalty: 1,000 penalty units or imprisonment for 12 months, or both, for an
individual or 5,000 penalty units for a body corporate.
(2)
Conduct that constitutes an offence under this section may be punished as a contempt of
court even though it could be punished as an offence.
[1.280]
31
Civil Procedure in New South Wales
Court Suppression and Non-​Publication Orders Act 2010 cont.
(3)
Conduct that constitutes an offence under this section may be punished as an offence even
though it could be punished as a contempt of court.
(4)
If conduct constitutes both an offence under this section and a contempt of court, the offender
is not liable to be punished twice.

Rinehart v Welker
[1.290] Rinehart v Welker [2011] NSWCA 403
BATHURST CJ and MCCOLL JA
[2]‌In this judgment we refer to, the applicants for review, Hope Rinehart Welker, John Langley
Hancock, Bianca Hope as the “plaintiff beneficiaries”, the interveners, the Australian Broadcasting
Commission; Fairfax Media Publications; and Nine Network; Nationwide News, as the “media
interests” the first respondent, Gina Hope Rinehart, as the trustee and the second respondent, Ginia
Hope Frances Rinehart, as the “defendant beneficiary” where necessary.
[3]‌The plaintiff beneficiaries seek a review pursuant to s 46 of the Supreme Court Act 1970 of
Tobias AJA’s decision granting a suppression order under the Court Suppression and Non-​publication
Orders Act 2010 (the “CSPO Act”): Rinehart v Welker and Ors [2011] NSWCA 345 (the “primary
judgment”). The orders were made on the application of the trustee and the defendant beneficiary.
The media interests have intervened in the proceedings both at first instance and on appeal to advance
the proposition that no suppression order should be, or should have been, made.
Legislative framework
…
[5]‌The CSPO Act is based on draft model provisions formulated as part of the process of harmonising
the laws of Australia which were endorsed at the May 2010 Standing Committee of Attorneys-​General
meeting. New South Wales is the first jurisdiction to adopt the model provisions: Second Reading
Speech, Court Suppression and Non-​publication Orders Bill, New South Wales Legislative Council,
Parliamentary Debates (Hansard) 23 November 2010.
[6]‌No other State or Territory has yet adopted the model provisions. However, the Commonwealth
has introduced the Access to Justice (Federal Jurisdiction) Amendment Bill 2011 which has been
read a second time and was referred on 25 November 2011 to the Legal and Constitutional Affairs
Legislation Committee for report by 22 March 2012. If passed the Bill will have the effect of inserting
the model provisions into the Family Law Act 1975 (Cth), the Federal Court of Australia Act 1976 (Cth),
the Federal Magistrates Act 1999 (Cth) and the Judiciary Act 1903 (Cth).
Background
[7]‌The background to the controversy appears in two decisions of Brereton J: Welker & Ors v Rinehart
[2011] NSWSC 1094 (the “Suppression Order decision”) and Welker & Ors v Rinehart & Anor (No 2)
[2011] NSWSC 1238 (the “Deed Decision”). In short, as the proceedings were commenced, the
plaintiff beneficiaries sought orders pursuant to the Trustees Act 1962 (WA) varying a Deed of
Settlement made by Langley George Hancock as amended by a subsequent Deed of Amendment
(the “Trust Deed”), varying the Trust Deed by splitting the trust into separate trusts and removing
the trustee from one of the newly created trusts (the “Second Trust”) and appointing themselves as
trustees of that Second Trust.
[8]‌The relief sought was subsequently amended. It is not apparent to what extent the amendments
superseded or supplemented any of the original claims for relief, although it appears that claims
dealing with the vesting of trust property have been abandoned: primary judgment (at [6], [17]).
32
[1.290]
Introduction to Civil Procedure
Chapter 1
Rinehart v Welker cont.
In the amended relief the plaintiff beneficiaries also sought orders in the Court’s inherent equitable
jurisdiction and/​or under the Trustees Act removing the trustee as Trustee of the Second Trust and a
declaration that she had misconducted herself in the administration of the Trust established under the
Trust Deed within the meaning of s 77(2)(b) of the Trustees Act: Deed Decision (at [1], [4]).
[9]‌The proceedings were commenced by ex parte application. From her first appearance, the
trustee sought a stay of the proceedings and a suppression order on the basis that the proceedings
were an abuse of process, having been commenced without prior compliance with the confidential
alternative dispute resolution (“ADR”) procedures for which the Trust Deed provided: Suppression
Order decision (at [3]). The defendant beneficiary supported that application. In particular the trustee
relied on cl 20.8 of the Deed which provided as follows:
Confidentiality of Proceedings
The dispute the subject of the mediation/​arbitration, the mediation and arbitration hearing
and the submissions thereto and the decision of the mediation and/​or arbitration shall be
kept confidential.
[10] Brereton J originally acceded to the application pending determination of the stay application:
Suppression Order decision (at [25]).
[11] However, his Honour subsequently held that the plaintiff beneficiaries’ claims, in substance to
remove the trustee and replace her with another family member, did not entail a “dispute under the
[Trust] Deed” –​the operative expression in the confidentiality provisions, cl 20: Deed Decision (at [7]‌,
[32]–​[41]). As to matters the defendant beneficiary sought to raise in defence, his Honour held that
even if they “might independently found a ‘dispute under this Deed’, in the present context they are
but aspects of a larger dispute, pertaining to removal of the trustee, which as a whole is not accurately
characterised as a ‘dispute under this Deed’ ”: Deed Decision (at [49]).
[12] The consequence was that the basis for the suppression order was removed (Deed Decision
(at [52])); however, his Honour (at [54]) decided to grant an interim suppression order pending the
determination of the application for leave to appeal from his decision to prevent prejudice to the
proper administration of justice. In this respect he said:
If such an order is not made, an arguable appeal –​as I find the application for leave to appeal
is –​would be rendered nugatory and the right to confidentiality under the Deed which the
defendants seek to vindicate by their application for leave to appeal would be defeated
before it could be heard in the Court of Appeal.
[13] His Honour ordered:
Pursuant to (NSW) Court Suppression and Non-​
Publication Orders Act 2010, s 10, and
alternatively pursuant to the inherent jurisdiction of the court, I make an interim suppression
order upon the ground referred to in s 8(1)(a) of that Act, that such order is necessary to
prevent prejudice to the administration of justice, prohibiting disclosure by publication or
otherwise of information as to any relief claimed in the proceedings or any pleading evidence
or argument filed read or given in the proceedings. This order has effect, subject to revocation
by this Court, until the expiration of 7 days from the date on which my written reasons
for judgment given orally on 7 October 2011 are published on the Court’s website, and
thereafter if within that period the first defendant or second defendant has filed a summons
for leave to appeal until the determination of that application or further order of this Court or
of the Court of Appeal. Pursuant to (NSW) Court Suppression and Non-​Publication Orders Act
2010, s 11, it is specified that this order applies throughout the Commonwealth of Australia.
Pursuant to (NSW) Court Suppression and Non-​Publication Orders Act 2010, s 9(4), this order
does not prohibit:
(a) Disclosure or publication of any judgment given in these proceedings to date nor of any
orders made in the proceedings.
[1.290]
33
Civil Procedure in New South Wales
Rinehart v Welker cont.
(b) Disclosure to Hancock Prospecting Pty Ltd nor to the professional advisers and potential
witnesses or funders of any party to the proceedings (including Hancock Prospecting
Pty Ltd), in every case only for the purposes of the proper conduct of these proceedings
and/​or the proposed appellate proceedings and provided that prior to such disclosure
the person to whom the disclosure is to be made has been informed of this order and
has acknowledged that they are bound by this order.
Tobias AJA’s decision
[14] On 28 October 2011 the trustee and the second beneficiary filed summonses seeking leave to
appeal from his Honour’s order dismissing the motions for a stay. They also filed notices of motion
seeking, among other orders, “a further order pursuant to the [CSPO] Act prohibiting the disclosure
by publication or otherwise of any information as to ‘the relief claimed or any pleading, including the
Summary of Argument, the Summons, the draft Notice of Appeal, evidence or argument filed read or
given in’ the proceedings the subject of the summons for leave to appeal”: primary judgment (at [5]‌).
It appears that relief was intended to embrace and build upon the suppression order Brereton J had
granted pending determination of the summons seeking leave to appeal and extend it to documents
brought into existence for the purpose of the appeal.
[15] The notices of motion came before Tobias AJA in the referrals list on 31 October 2011 on
which occasion his Honour delivered an ex tempore judgment.
[16] The trustee and the second beneficiary based their application for relief on s 8(1)(a) of the
CSPO Act: primary judgment (at [13]). They submitted (primary judgment (at [25]–​[26])):
as a matter of certainty, publication of the material that would be filed in the present appeal
would negate the purpose of the confidentiality provisions in the Deed and would circumvent
the rights of the applicants to have such disputes resolved by confidential mediation or
arbitration in the event the leave to appeal was granted and the appeal succeeded [and that]
… not to grant such an order, as his Honour himself had observed at [54] of the second
judgment, would render any appeal (if leave was granted) nugatory.
[17] His Honour recorded counsel for the plaintiff beneficiaries’ contentions, including:
[29] In one sense it was accepted that this was a family dispute about the interests in, and
the governance of, a family trust. However, Dr Bell submitted that the public had an interest
in the determination of a dispute such as the present that involved alleged misconduct on
behalf of a trustee. He contended that unacceptable conduct on behalf of a trustee should
be the subject of a public hearing, and normally is, where the Court will lay down what is
acceptable conduct of a trustee and what is not.
[18] Of this submission, his Honour said:
[30] On its face that submission may well be true but of itself I do not regard it as carrying
any particular weight when determining whether an order is necessary to prevent prejudice
to the proper administration of justice in the context of the present case.
[19] His Honour dealt with Dr Bell’s next submissions as follows:
[31] It was also submitted by Dr Bell that if the primary judge was correct and if I did grant
an order pursuant to the Act, its effect would be that open justice would be trumped by
any agreement entered into between parties that provided for the confidential resolution
of their disputes outside the ordinary court system. However, it does not seem to me that
the public interest referred to should in every case be permitted to trump the provisions of
an agreement by parties closely related to each other that their family disputes should be
determined in confidence and out of the public eye.
[32] It was further submitted that in the event that his Honour’s dismissal of the stay
application was reversed by this Court, there would then be a stay and the dispute between
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Rinehart v Welker cont.
the parties would then proceed on a confidential basis in accordance with the Deed
and, therefore, no harm would be caused. The difficulty with that argument is that given the
terms of the amended summons, the situation would then be that the allegations against
Mrs Rinehart would be in the public domain but because of the grant of a stay, her response
thereto and the ultimate resolution of those allegations would be kept confidential. It does
not seem to me that the administration of justice would be advanced in such an event.
[33] Thus in the circumstances postulated there would be significant pressure upon
Mrs Rinehart to make public her response to the allegations which are in the public domain
and to the ultimate resolution of the dispute, particularly if it was in her favour.
[20] Tobias AJA (at [35]) approached the issue of the strength of the case on appeal on the basis of
Brereton J’s observation that it was “arguable”, while recognising (at [36]) that that “may still mean
that its prospects of success are not particularly strong”.
[21] His Honour then, after referring to s 6 of the CSPO Act, said in passages of which the plaintiff
beneficiaries and the media interests are both highly critical:
[38] It cannot be gainsaid that it is necessary for the Court in determining whether to
exercise the discretion to grant a suppression or non-​publication order in the event that one
of the grounds referred to in s 8(1) is made out, to take account of the fact that “a primary
objective of the administration of justice is to safeguard the public interest and open justice”.
It is noteworthy, however, that the public interest in open justice is not said by s 6 to be
either the primary objective of the administration of justice or the only objective thereof. It
is a primary objective, meaning that there are other primary objectives of the administration
of justice, or may well be, which should be taken into account. One of these is that parties
should be held to their bargain.
…
[41] However, as submitted by the applicants, the administration of justice is a multi-​faceted
concept. There is no doubt, and it was not disputed, that it is generally in the interests of
the administration of justice that parties should be held to their bargain. Furthermore, and
in the present day and age, disputing parties are encouraged to provide in their commercial
agreements for a form of alternative dispute resolution which would take the pressure off the
courts. The administration of justice in my view is capable of including the encouragement
of parties to make such agreements and to abide by them where they otherwise apply to the
dispute in question.
[42] The parties in the present case have entered into such an agreement and subject to the
issue as to whether the agreement applies to the present dispute, it should be given effect to
with the result that a stay of the respondents’ proceedings would likely be granted. If a stay
is granted then it is difficult to see why the public should be made aware of the nature of the
dispute which is required to be kept confidential, let alone the nature of the allegations that
are made by one party or the other against another.
[44] Mr Dawson adopted Dr Bell’s submissions and added some submissions of his own.
In particular, like Dr Bell, he sought to advance the proposition that there was a tension, as
clearly there is, between the protection of a private right of contract on the one hand and the
objective referred to in s 6 of the Act of safeguarding the public interest in open justice on
the other. However, accepting that open justice is a primary objective of the administration
of justice does not necessarily lead in every case to that objective being given determinative
weight. The proper administration of justice has other objectives than that of open justice
although it cannot be gainsaid that the latter is of fundamental importance, as this Court has
made clear on numerous occasions.
[45] However, taking that into account, if otherwise it is necessary to make an order to
prevent prejudice to the administration of justice then the Court should not shrink from
doing so. The Parliament has spoken and the common law must take second place to the
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provisions of the statute. Although there was some suggestion by his Honour that the statute
provided a more strict criteria than existed at common law, I am not convinced that that
is so. In my view the purpose of the legislation is to permit of the making of a suppression
or non-​publication order in circumstances which would not necessarily conform to the
exceptions which the common law has recognised to the principle of open justice. However,
there is no doubt that the strict words of the statute in terms of the grounds which must be
established before an order is made, must be adhered to.
[22] The terms of the order Tobias AJA made were:
[1] Pursuant to s 7 of the Court Suppression and Non-​publication Orders Act 2010 (NSW) (Act),
and on the grounds referred to in s 8(1)(a), a suppression order is made prohibiting the
disclosure by publication or otherwise of any information as to the relief claimed or any
pleading, the Summary of Argument, submissions, the draft Notice of Appeal, evidence
or argument filed, read or given in these proceedings, and including the contents of
the red book, blue book, black book and orange book but not including the Summons
seeking Leave to Appeal or the pronounced or published judgment of Tobias AJA.
[2]
Pursuant to s 12 of the Act, the suppression order in paragraph 1 above operates until
determination of the Applicant’s application for leave to appeal is determined or until
further order of the Court.
[3] Pursuant to s 11 of the Act, the suppression order in paragraph 1 above applies
throughout the Commonwealth.
[23] At the time his Honour made the suppression order, he also made orders expediting the
summonses for leave to appeal which are to be heard concurrently with the appeals.
Consideration
[24] We have set out the entirety of s 8 to give context to s 8(1)(a) upon which the trustee and
defendant beneficiary rely to support the making of the suppression order.
[25] Underlying the enactment of the CSPO Act was, in part, a concern to resolve the question
whether a court’s inherent or implied power to make orders restricting the publication of any aspect
of proceedings before it extended to orders purporting to bind the world at large: see Hogan v Hinch
[2011] HCA 4; (2011) 85 ALJR 398 (at [23]–​[27], [46]) per French CJ; Attorney-​General (NSW) v Mayas
Pty Ltd (1988) 14 NSWLR 342 (at 355) per McHugh JA, Hope JA agreeing; Second Reading Speech,
Court Suppression and Non-​publication Orders Bill, New South Wales Legislative Council, Parliamentary
Debates (Hansard) 23 November 2010.
[26] The principle of legality favours a construction of legislation such as the CSPO Act which,
consistently with the statutory scheme, has the least adverse impact upon the open justice principle
and common law freedom of speech and, where constructional choices are open, so as to minimise
its intrusion upon that principle: Hogan v Hinch (at [5]‌, [27]) per French CJ; see also Raybos Australia
Pty Ltd v Jones (1985) 2 NSWLR 47 (at 55) per Kirby P.
The meaning of “necessary”
[27] The operative condition for making a suppression order under s 8 of the CSPO Act is that
it be “necessary” to do so, which “… is a strong word [which, in] collocation [with] necessity to
prevent prejudice to the administration of justice … ‘suggests Parliament was not dealing with
trivialities’ ”: Hogan v Australian Crime Commission [2010] HCA 21; (2010) 240 CLR 651 (at [30]). The
observations in Hogan v Australian Crime Commission were made in relation to a legislative scheme
which, while it required the jurisdiction of the Court to be exercised in open court (s 17, Federal Court
of Australia Act) did not contain a provision in like terms to s 6 of the CSPO Act. That provision, in our
view, reinforces the legislative intention that CSPO Act orders should only be made in exceptional
circumstances, a position which prevailed at common law: John Fairfax Publications Pty Ltd v District
Court of NSW (at [21]).
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[28] The word “necessary” was adopted as the test for making a suppression order on the
recommendation of the NSW Law Reform Commission: see NSW Law Reform Commission,
Contempt by Publication, Report 100, (June 2003), at [10.20]; see also NSW Law Reform
Commission, Contempt by Publication, Discussion Paper 43, (July 2000) at Chapter 10, where the
principal discussion leading to the recommendation in the final Report appears. Similar language
appears in s 50 of the Federal Court of Australia Act and s 4(2) and s 11 of the Contempt of Court Act
1981 (UK). It was the test applied by courts with an inherent jurisdiction to make non-​publication
orders: John Fairfax Publications Pty Ltd v District Court of NSW (at [38]).
[29] A number of authorities are cited in the Discussion Paper (at [10.92]) as authority for the
proposition that the test for making a suppression or non-​publication order should be that it be
“necessary”. Of those authorities, the clearest statement, and that which appears to underlie the form
of s 8, appears in John Fairfax & Sons Ltd v Police Tribunal (NSW) (1986) 5 NSWLR 465 (at 476–​477)
per McHugh JA (Glass JA agreeing):
The fundamental rule of the common law is that the administration of justice must take
place in open court. A court can only depart from this rule where its observance would frustrate
the administration of justice or some other public interest for whose protection Parliament has
modified the open justice rule. The principle of open justice also requires that nothing should be
done to discourage the making of fair and accurate reports of what occurs in the courtroom.
Accordingly, an order of a court prohibiting the publication of evidence is only valid if it is really
necessary to secure the proper administration of justice in proceedings before it. Moreover, an
order prohibiting publication of evidence must be clear in its terms and do no more than is
necessary to achieve the due administration of justice. The making of the order must also be
reasonably necessary; and there must be some material before the court upon which it can
reasonably reach the conclusion that it is necessary to make an order prohibiting publication.
Mere belief that the order is necessary is insufficient. (emphasis added)
John Fairfax & Sons Ltd v Police Tribunal (NSW) was the principal authority on the subject
of making non-​publication orders in New South Wales prior to the enactment of the CSPO
Act: John Fairfax Publications Pty Ltd & Anor v District Court of NSW (at [38]). French CJ referred
to this passage with approval in Hogan v Hinch (at [21]).
[30] The necessity requirement may also be stated by quoting Isaacs J’s statement in R v Macfarlane; Ex
parte O’Flanagan and O’Kelly [1923] HCA 39; (1923) 32 CLR 518 (at 549) (approved by the plurality
(Gummow, Hayne, Heydon, Crennan, Kiefel and Bell JJ) in Hogan v Hinch (at [87]):
The final and paramount consideration in all cases is that emphasized in Scott v Scott namely,
“to do justice” (Viscount Haldane LC). All other considerations are means to that end. They
are ancillary principles and rules. Some of them are so deeply embedded in our law as to
be elementary and axiomatic, others closely approach that position. Of the latter class is
publicity, which can only be disregarded where necessity compels departure, for otherwise
justice would be denied to those whom Earl Loreburn termed “the parties entitled to justice”.
[31] Significantly, an order is not “necessary” if it appears to the court “to be convenient, reasonable
or sensible, or to serve some notion of the public interest, still less that, as the result of some ‘balancing
exercise’, the order appears to have one or more of those characteristics”: Hogan v Australian Crime
Commission (at [31]). Further, it is not a sufficient basis for such an order that the information is
inherently confidential as distinct from personal or commercial information the value of which as an
asset would be seriously compromised by disclosure: Hogan v Crime Commission (at [38]).
Open justice
[32] By way of reinforcement of the proposition in [31], s 6 of the CSPO Act requires the court when
considering whether to make an order under the Act to “take into account that a primary objective
of the administration of justice is to safeguard the public interest in open justice”. The principle of
open justice is one of the most fundamental aspects of the system of justice in Australia: John Fairfax
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Publications Pty Ltd v District Court of NSW [2004] NSWCA 324; (2004) 61 NSWLR 344 (at [18]) per
Spigelman CJ (Handley JA and Campbell AJA agreeing). Open justice ensures public confidence in
the administration of justice: see Moti v R [2011] HCA 50 (at [100]) per Heydon J; Hogan v Hinch (at
[20]) per French CJ; R v Tait (1979) 46 FLR 386 (at 401–​403) per Brennan, Deane and Gallop JJ. It is
unnecessary to add to the large body of judicial opinions discussing the concept. It is sufficient, in our
view, to illustrate the proposition embedded in s 6 by referring to Lord Atkinson’s statement in Scott
v Scott [1913] AC 417 (at 463), that “in public trial is [to be] found, on the whole, the best security
for the pure, impartial, and efficient administration of justice, the best means of winning for it public
confidence and respect”.
[33] “The entitlement of the media to report on court proceedings is a corollary of the right of
access to the court by members of the public”: John Fairfax Publications Pty Ltd v District Court of NSW
(at [20]). Media interests had standing at common law to be heard on the making of orders affecting
the publication of court proceedings (see generally John Fairfax Group Pty Ltd (Receivers and Managers
appointed) v Local Court of New South Wales (1992) 26 NSWLR 131) a position now enshrined in s 9(2)
(d), CSPO Act at least insofar as a “news media organisation” is concerned.
[34] A number of exceptions to the principle of open justice are recognised. Viscount Haldane VC
referred to two in Scott v Scott (at 437) as being “cases of wards of Court and of lunatics [where] the
Court is really sitting primarily to guard the interests of the ward or the lunatic [and] [i]‌ts jurisdiction
is … parental and administrative, and the disposal of controverted questions is an incident only in the
jurisdiction” and “litigation as to a secret process, where the effect of publicity would be to destroy
the subject-​matter … which stands on a different footing [and] [t]here it may well be that justice could
not be done at all if it had to be done in public”. (See also the Earl of Halsbury (at 441)–​(443); Earl
Loreburn (at 446); Lord Atkinson (at 450)–​(451), (462); Lord Shaw of Dunfermline (at 482)–​(483).)
His Lordship then said (at 437–​438):
As the paramount object must always be to do justice, the general rule as to publicity, after
all only the means to an end, must accordingly yield. But the burden lies on those seeking
to displace its application in the particular case to make out that the ordinary rule must as of
necessity be superseded by this paramount consideration. The question is by no means one
which, consistently with the spirit of our jurisprudence, can be dealt with by the judge
as resting in his mere discretion as to what is expedient. The latter must treat it as one of
principle, and as turning, not on convenience, but on necessity.
I think that if the principle in cases of secret process be what I have stated, it affords guidance
in other cases. … [U]‌nless it be strictly necessary for the attainment of justice, there can be no
power in the Court to hear in camera either a matrimonial cause or any other where there is
contest between parties. He who maintains that by no other means than by such a hearing
can justice be done may apply for an unusual procedure. But he must make out his case
strictly, and bring it up to the standard which the underlying principle requires. He may be able
to [show] that the evidence can be effectively brought before the Court in no other fashion.
He may even be able to establish that subsequent publication must be prohibited for a time
or altogether. But this further conclusion he will find more difficult in a matrimonial case than
in the case of the secret process, where the objection to publication is not confined to the
mere difficulty of giving testimony in open Court. In either case he must satisfy the Court that
by nothing short of the exclusion of the public can justice be done. The mere consideration that
the evidence is of an unsavoury character is not enough, any more than it would be in a criminal
Court, and still less is it enough that the parties agree in being reluctant to have their case tried
with open doors. (emphasis added)
[35] Lord Loreburn said (at 446):
in all cases where the public has been excluded with admitted propriety the underlying
principle, as it seems to me, is that the administration of justice would be rendered
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impracticable by their presence, whether because the case could not be effectively tried,
or the parties entitled to justice would be reasonably deterred from seeking it at the hands
of the Court.
Lord Loreburn’s statement was regarded as indicating the general approach by Viscount Dilhorne in
Attorney General v Leveller Magazine Ltd [1979] AC 440 (at 457).
[36] As Brereton J said (Suppression Order decision (at [11]), referring to John Fairfax Group
Pty Ltd (Receivers and Managers Appointed) and Another v Local Court of New South Wales (1991)
26 NSWLR 131 (at 141) per Kirby P), another “well-​established illustration was in blackmail and
extortion cases”, where:
If the very openness of court proceedings would destroy the attainment of justice in the
particular case (as by vindicating the activities of the blackmailer) or discourage its attainment
in cases generally (as by frightening off blackmail victims or informers) or would derogate
from even more urgent considerations of public interest (as by endangering national security)
the rule of openness must be modified to meet the exigencies of the particular case.
[37] A further exception is where disclosure of the information would seriously affect its commercial
value: Australian Broadcasting Commission v Parish [1980] FCA 33; (1980) 43 FLR 129 at 133; Hogan v
Crime Commission (at [42]).
[38] None of these exceptions apply in the present case.
The administration of justice
[39] The concept of the administration of justice is multi-​faceted. We doubt whether a single statement
can capture the connotation it carries in a range of contexts. As Young JA has said (at [86]) as used
in s 50 of the Federal Court of Australia Act, “it is … a reference to the public interest that the court
should endeavour to achieve effectively the object for which it was appointed to do justice between
the parties”: Australian Broadcasting Commission v Parish (at 133) per Bowen CJ.
[40] Mahoney JA (with whom Hope AJA agreed) captured the concept in John Fairfax Group Pty Ltd
v Local Court of New South Wales (1991) 26 NSWLR 131 (at 161), when (after referring to McHugh JA’s
statement in John Fairfax & Sons Ltd v Police Tribunal (NSW) (at 355)) he said:
This leads to the consideration of what is meant by “necessary to secure the proper
administration of justice” in this context. The phrase does not mean that if the relevant
order is not made, the proceedings will not be able to continue. Plainly they can. If the name
of an informer is not hidden under a pseudonym, the proceedings will go on: at least the
instant proceeding will. … The basis of the implication is that if the kind of order proposed is
not made, the result will be –​or at least will be assumed to be –​that particular consequences will
flow, that those consequences are unacceptable, and that therefore the power to make orders
which will prevent them is to be implied as necessary to the proper function of the court. The
kind of consequences that, in this sense, will be seen as unacceptable may be gauged by
those involved in the cases in which statutory courts have been accepted as having restricted
powers. Thus, there will be hardship on the informer or the security officer or the blackmail
victim; the future supply of information from such persons will end or will be impeded; and
it will be more difficult to obtain from such persons the evidence necessary to bring offenders
before the courts and deal with them. It is not necessary to attempt to state exhaustively the
considerations relevant in this regard: it is to considerations of this kind or of an analogous
kind on which the principle stated by McHugh JA is based.
The effect of parties’ agreements
[41] The parties to the proceedings entered into a Deed pursuant to cl 20 of which they agreed that
“disputes arising under this deed” should be dealt with first by confidential mediation and, if that
failed, by confidential arbitration. It also contained cl 20.8.
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[42] Party autonomy is said to be “fundamental in modern arbitration law” and, to find reflection
in legislative recognition of parties’ right “to agree about how their commercial disputes are to be
resolved subject to, inter alia such safeguards as are necessary in the public interest”: s 1C, Commercial
Arbitration Act 2010; s 1 Arbitration Act 1996 (UK). “[P]‌arties value English arbitration for its privacy
and confidentiality”: Department of Economics, Policy and Development of the City of Moscow v Bankers
Trust Co [2004] EWCA Civ 314; [2005] QB 207 (at [1], [30]) per Mance LJ (Carnwath LJ agreeing);
see also Fiona Trust & Holding Corp v Privalov [2007] UKHL 40; [2008] 1 Lloyd’s Rep 254 (at [6]) per
Lord Hoffman; Thoroughvision Pty Ltd v Sky Channel Pty Ltd [2010] VSC 139 (at [16]–​[17]).
[43] The private character of the arbitration hearing is “something that inheres in the subject
matter of the agreement to submit disputes to arbitration”. It is said that “[t]‌he efficacy of a private
arbitration will be damaged, even defeated, if proceedings in the arbitration are made public by the
disclosure of documents relating to the arbitration”: Esso Australia Resources Ltd v Plowman (Minister
for Energy & Minerals) [1995] HCA 19; (1995) 183 CLR 10 (at 26, 27) per Mason CJ, Brennan and
McHugh J agreeing.
[44] However, as Mason CJ explained in Esso Australia Resources Ltd v Plowman (Minister for Energy
& Minerals) (at 27ff) in rejecting the view that confidentiality is an essential characteristic of a private
arbitration, privacy is not synonymous with confidentiality. To secure confidentiality an express
provision may be necessary, although even that may not bind persons such as witnesses not parties
to the arbitration agreement. It is no doubt for that reason that cl 20.8 appears in the Trust Deed.
[45] According respect to party autonomy does not mean that everything associated with a private
arbitration wears a mantle of confidentiality. Even where an arbitration hearing has been conducted
in private pursuant to a court order and even recognising that “[p]‌arty autonomy requires the court
so far as possible to respect the parties’ choice of arbitration”, once a court’s supervisory jurisdiction
is invoked, the fact the arbitration was held in private is only a factor relevant to the question whether
the proceedings should be heard in open court: Department of Economics, Policy and Development of
the City of Moscow v Bankers Trust Co (at [28], [30], [34]–​[36]).
[46] Scott v Scott, it will be recalled, was a case where the parties to a nullity suit had agreed that it
should be heard in camera. The House of Lords held that the Probate, Divorce and Admiralty Division
had no power to hear the suit (or other matrimonial suit) in camera in the interest of public decency.
Viscount Haldane VC (at 439) said, “the order was made in reality for the benefit of the parties who
concurred in asking for it, and was therefore made under a mistaken impression as to the law”.
[47] In R v Legal Aid Board; Ex parte Kaim Todner (a firm) [1998] EWCA Civ 958; [1999] QB 966 (at
977) Lord Woolf MR emphasised the proposition that the parties’ agreement that proceedings, or
particular aspects of them, should be heard in camera or be subject to a non-​publication order was
not determinative, saying:
[4]‌ … Sometimes the importance of not making an order, even where both sides agree that
an inroad should be made on the general rule, if the case is not one where the interests
of justice require an exception, has been overlooked. Here a comment in the judgment of
Sir Christopher Staughton in Ex p P (1998) Times, 31 March, is relevant. In his judgment,
Sir Christopher Staughton states: “When both sides agreed that information should be kept
from the public that was when the court had to be most vigilant.” The need to be vigilant
arises from the natural tendency for the general principle to be eroded and for exceptions
to grow by accretion as the exceptions are applied by analogy to existing cases. This is the
reason it is so important not to forget why proceedings are required to be subjected to
the full glare of a public hearing. It is necessary because the public nature of proceedings
deters inappropriate behaviour on the part of the court. It also maintains the public’s
confidence in the administration of justice. It enables the public to know that justice is being
administered impartially. It can result in evidence becoming available which would not
become available if the proceedings were conducted behind closed doors or with one or
more of the parties’ or witnesses’ identity concealed. It makes uninformed and inaccurate
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comment about the proceedings less likely. If secrecy is restricted to those situations where
justice would be frustrated if the cloak of anonymity is not provided, this reduces the risk of
the sanction of contempt having to be invoked, with the expense and the interference with
the administration of justice which this can involve.
Conclusion
[48] We are conscious of the heavy burden a party seeking a s 46(4) review has to discharge to have
a Judge of Appeal’s order set aside. Such an application is not an appeal: s 19(2), Supreme Court Act;
Uniform Civil Procedure Rules 2005 51.2. In order to succeed, the plaintiff beneficiaries must demonstrate
that the judge erred in principle or that the judge’s decision was plainly wrong: Transglobal Capital Pty
Ltd v Yolarno Pty Ltd [2004] NSWCA 136; (2004) 60 NSWLR 143 (at [4]‌, [6]); Kiri Te Kanawa v Leading
Edge Events Australia Pty Ltd [2007] NSWCA 274 (at [14]) (per Giles JA, Ipp and Basten JJA agreeing);
Lo v Iverach [2009] NSWCA 92 (at [29]) (Allsop P, Giles and Macfarlan JJA). Although these tests bear
similarities to those applied in reviewing a discretionary decision (House v R [1936] HCA 40; 55 CLR
499), a decision to make a suppression order is not a discretionary one: Hogan v Australian Crime
Commission (at [33]).
[49] In our view, with respect, Tobias AJA relevantly erred. His Honour failed to approach the
question whether a suppression order should be granted on a basis which has the least adverse impact
upon the open justice principle: see [26] above.
[50] Tobias AJA made the order under s 8, at least in part, to give effect to the maxim pacta
sunt servanda (agreements are to be kept). He also held that publication would render any appeal
nugatory presumably on the basis set out in pars [32] and [33] of his judgment that if a stay was
granted the trustee’s response and the ultimate resolution of the proceedings would be confidential
and there would be significant pressure on Mrs Rinehart to make public her response and the ultimate
resolution of the proceedings.
[51] It is well accepted that the Court will, in appropriate circumstances, give effect to agreements
to arbitrate by ordering a stay of proceedings brought in breach of the arbitration agreement. That
jurisdiction recognises the party autonomy to which we have referred. However, as is apparent from
the foregoing discussion, that is not determinative of the question whether, on an application for such
a stay, it is necessary for the proper administration of justice for the Court to make a suppression order
to give effect to a provision such as cl 20.8 prohibiting disclosure of the nature of the dispute both
before, during and after the arbitration proceedings. Tobias AJA, with respect, appears to have treated
it as such. In our view, his Honour erred (at [19]) in treating the fact that the parties had agreed to the
cl 20.8 clause as effectively determining the question whether a suppression order should be made.
[52] His Honour, with respect, was somewhat dismissive (at [30]) of the plaintiff beneficiaries’
submission about the public interest in the determination of a dispute involving the alleged misconduct
of a trustee. As we have said, the plaintiff beneficiaries make allegations of breach of trust and seek
that the Court invoke its statutory power to remove a trustee. It is not suggested that proceedings
were brought for a collateral purpose or that the disclosure of the materials would […] have any effect
on the value of the assets of the trust or other assets of the parties. The proper conduct of trustees is a
matter which warrants close public scrutiny. It was a proper factor to take into account in determining
whether a suppression order was necessary.
[53] Tobias AJA also erred in our opinion in concluding that the failure to make a suppression order
would render the proceedings nugatory. Disclosure of the information the subject of the suppression
order will not “cause an entire destruction of the whole matter in dispute”: Hogan v Hinch (at [21]).
The trustee, if successful in obtaining a stay, will have the benefits of the substance of the allegations
and matters concerning the trust being considered in a private arbitration rather than a public forum.
This would seem to us to be the primary purpose of the arbitration/​mediation provisions in the Deed.
Such advantages remain irrespective of the fact that the allegations made against her have been
publicly disclosed.
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[54] Tobias AJA’s concern that if a suppression order was not made the allegations against the
trustee would be in the public domain but her response would be confidential did not, in our view,
demonstrate the order was necessary: “In general … parties and witnesses have to accept the
embarrassment and damage to their reputation and the possible consequential loss which can be
inherent in being involved in litigation”: R v Legal Aid Board; Ex parte Kaim Todner (a firm) (at 978). It is
true that Lord Woolf MR went on to say that: “[t]‌he protection to which they are entitled is normally
provided by a judgment delivered in public which will refute unfounded allegations”, but that does
not, in our view, detract from the force of his previous observation. It is the price of open justice that
allegations about individuals are aired in open court. Such individuals, particularly if they are parties,
can make their response to such allegations public in the same forum. The media, the vehicle by
which such allegations are usually published to the world would be obliged to publish any response
to ensure any report of the proceedings was fair: s 29, Defamation Act 2005.
[55] In our view, having regard to the nature of the proceedings it was neither “necessary to
prevent prejudice to the administration of justice” and, further contrary to the requirement to treat
open justice as “a primary objective” referred to in s 6 of the Act for the Court to exercise its power
under s 8 to suppress information of the nature of that caught by Tobias AJA’s orders. Suppression of
such information would undermine, rather than ensure, public confidence in the administration of
justice.
[56] It is unnecessary to deal with the question of the construction of s 7 both because of the
conclusion we have reached and because it may not have been clearly articulated before either
Brereton J or Tobias AJA.

“X” v Sydney Children’s Hospitals Specialty Network
[1.295] “X” v Sydney Children’s Hospitals Specialty Network [2011] NSWSC 1272
ADAMSON J
[3]‌The order sought by the Plaintiff is that her name and other identifying information not be
published, including the identity of members of her family in so far as that would identify her. The
grounds for making an order under s 7 are set out in s 8 of the Act …
[4]‌Ms Sant, Junior Counsel, who made the application on behalf of the Plaintiff, relied on
subparagraphs (a), (c) and (e) of subsection (1) of s 8.
[5]‌The Act commenced on 1 July 2011 and specifically provides, by s 4, that it does not limit
or otherwise affect any inherent jurisdiction or any powers that a Court has apart from the Act to
regulate its proceedings or to deal with a contempt of the Court. Accordingly, assistance can be
obtained from authorities decided prior to the commencement of the Act.
[6]‌Ms Sant has referred me to decisions made under the now repealed s 72 of the Civil Procedure
Act 2005 (NSW) or like provisions in other jurisdictions. Ms Sant has referred me to pseudonym orders
such as those sought by the Plaintiff in the instant case which have been made in cases of particular
sensitivity. Examples include litigation brought by HIV infected people against the Red Cross because
of the stigma attaching to HIV and AIDS: E v Australian Red Cross Society and Ors (1991) 27 FCR 310 at
313; TK v Australian Red Cross Society (1989) 1 WAR 335; and more recently in BT v Oei [1999] NSWSC
1082, another case in which the plaintiff had HIV. In TK, Malcolm CJ considered plaintiffs might be
reasonably deterred from bringing proceedings because of the embarrassment that they might suffer
if their condition were known generally.
[7]‌The Plaintiff submits that non-​publication orders have also been fairly regularly made in fertility
cases to ensure that the child in question did not later happen upon circumstances discussed in the
42
[1.295]
Introduction to Civil Procedure
Chapter 1
“X” v Sydney Children’s Hospitals Specialty Network cont.
case. Examples including Sydney South West Area Health Service v MD [2009] NSWCA 343; Ax v Stern
[2008] VSC 400 have been instanced. Although Ms Sant put the Plaintiff’s application on the basis, as
I have said above, of subparagraphs (a), (c) and (e) of s 8, the evidence adduced principally concerned
subparagraph (c), namely the order is necessary to protect the safety of any person.
[8]‌Nonetheless, I accept that where disclosure of the Plaintiff’s identity carries with it a risk of
harm, there is a potential prejudice to the administration of justice and to the public interest in people
being able to exercise their legal rights. It would potentially prejudice the administration of justice
were the parents of a child who had suffered harm, allegedly as a result of negligence, to be deterred
from bringing proceedings for damages because of concern for the harm that disclosure of the child’s
identity could cause the child.
[9]‌Ms Sant submitted that the Plaintiff has suffered a psychiatric illness and that she is a particularly
vulnerable person who is liable to decompensate or become depressed or anxious if her identity is
revealed. Ms Sant contends that her impairment is serious and severe and that her insight is sufficient
for her to appreciate the extent of her impairment and disability.
[10] The affidavit of Mr Curtis referred to above, which is filed in support of the application,
deposes to his instructions from the Plaintiff’s father and next friend to the following effect:
[The Plaintiff] is a very private person who demands a low profile and becomes visibly upset
and angry with those responsible if she is put in a position where she stands out from the
crowd. [The Plaintiff] likes to think of herself as being normal and tries to be normal. If
[the Plaintiff’s] brain damage came to be in the public domain I believe it would be soul
destroying for her. I believe it would destroy her psychologically. I am concerned that [the
Plaintiff] will find reference to herself and this case on the internet and if that were to occur
such a discovery would be devastating for her. Her self esteem is already incredibly low.
Annexed to Mr Curtis’ affidavit are three reports of Dr Peter Krabman, the Plaintiff’s treating psychiatrist,
dated 9 June 2001, 18 September 2001 and 23 October 2001 respectively. Ms Sant has drawn my
attention to the following passage in the report of 9 June 2001:
It is my impression that she likely met criteria for an emotional disorder with mixed anxiety
and depression for significant periods of her childhood, associated with the frustrations of
her patchy developmental (and particularly communication) difficulties and the struggles of
adapting to the school environment.
[11] Dr Krabman, in the same report, sets out his current diagnosis for the Plaintiff, namely “Axis One
Pervasive Development Disorder Not Otherwise Specified”. Dr Krabman opines that the Plaintiff uses
denial and narcissistic defences to avoid the pain of disability by pretending that it does not exist
and putting on a tough front. He says that she wants to feel normal and pretend to be normal, and
comments that her mother and teachers have learned that they must give guidance in small bursts
repeatedly and expect some “attitude” in response. Ms Sant contends, and I accept her contention,
that these matters are highly relevant to the risk of harm to the Plaintiff were her name to become
publicly known to her school mates, or were she to be privy to details about her case, for example,
through access through the internet or other media.
[12] In his second report dated 18 September 2001, Dr Krabman opines that the diagnostic and
prognostic opinions expressed in his earlier report of 9 June 2001 remain current with the addition
of a likely progression to a current depressive disorder. Ms Sant emphases the prognosis of a likely
progression to current depressive disorder in support of her application for a suppression and non-​
publication order, and her submission that the order is necessary to protect the Plaintiff’s safety, which
includes psychiatric safety.
[13] Finally, Ms Sant drew my attention to the final report of Dr Krabman dated 23 October 2001
in which he specifically addresses the question of the need for preservation of the Plaintiff’s privacy
during the Court hearing. Dr Krabman said:
[1.295]
43
Civil Procedure in New South Wales
“X” v Sydney Children’s Hospitals Specialty Network cont.
It is my impression that if [the Plaintiff] were to be named in press reporting of her case it is
likely that this would cause significant distress for [the Plaintiff] and personal, interpersonal
and developmental disruption. Specifically, there would be a high likelihood that [the Plaintiff]
herself and/​or [the Plaintiff’s] media savvy peers at school and/​or their parents would discover
[the Plaintiff’s] link to the Court case, hear a reference to brain damage, in addition to other
matters relating to the case, and discuss these matters with [the Plaintiff] in a way which she
would find distressing and to which she is likely to react with either aggression/​denial or need
clinginess. In addition to [the Plaintiff’s] over-​reaction to peers or others who might enquire
about what they had heard in the media, the content of media reports trigger insecurity
or an instability in [the Plaintiff’s] sense of self, and disrupt the sensitive process which [the
Plaintiff’s] parents and I are involved in of assisting [the Plaintiff] to come to terms with her
history and her impairment. This insecurity will worsen depressive symptoms so I strongly
support the de-​identifying of media reports of the case if this is an option which is available.
[14] I note that here all the Plaintiff seeks is a pseudonym order which, if granted, will not affect the
public nature of the proceedings nor the ability of the press to report on the proceedings fully, with
the only restriction being that the Plaintiff may not be identified.
[15] I consider that pseudonym orders interfere with open justice only minimally and that such an
order is warranted in the instant case. In my opinion, such an order is necessary to prevent prejudice
to the proper administration of justice since, if the order were refused, the Plaintiff’s next friend might
feel under undue pressure to resolve the proceedings to avert the risk of harm to the Plaintiff that
would be occasioned were the final to proceed to final judgment and the reasons for decision to be
available on the internet (as they commonly are). I also accept, for the reasons given by Ms Sant,
that the order is necessary to protect the Plaintiff’s psychological safety. I consider that the public
interest in permitting persons to exercise their right to have the question whether they are entitled
to damages as a result of negligence determined outweighs the public interest in open justice in the
circumstances of the instant case to which I have referred above.
[16] Section 11 of the Act provides that the order under s 7 may be made to apply to the
Commonwealth, and not merely to New South Wales. However s 11(3) provides that an order is not
to be made to apply outside New South Wales unless the Court is satisfied that having the order apply
outside New South Wales is necessary for achieving the purpose for which the order is made. I am
satisfied of that matter. Having regard to the reach of the internet and its considerable accessibility to
the Plaintiff and her peers, I propose to make the order apply throughout the Commonwealth.
[17] Section 12 of the Act provides that a suppression or non-​publication order operates for the
period decided by the Court and specified in the order. Section 12(2) provides that the Court is to
ensure that the order operates for no longer than is reasonably necessary to achieve the purpose for
which it is made. Initially the Plaintiff contended that I should make the order “until further order”;
however, the parties have since conferred and there is agreement that it would be appropriate for
the order to be made until the conclusion of the evidence in the proceedings. It is said, and I accept,
that when I have heard all the evidence in the case I will be in a better position to determine the
appropriate length of the order. As will be seen from the orders set out below, I have added a period
of seven days from the conclusion of the evidence to the duration of the order, in order that I may
have sufficient time to consider the appropriate term of any further order.
Orders
[18] Accordingly, I make the following orders, which, with the exception of the additional seven days
to the term of the order, have been the subject of consideration by the parties:
(1)
Publication in Australia of the name of the Plaintiff and her next friend is prohibited, except that:
(a)
44
[1.295]
the Court and court staff, the parties to the proceedings and their legal representatives
and witnesses in the proceedings may identify the Plaintiff and her next friend for the
purposes of or associated with the proceedings;
Introduction to Civil Procedure
Chapter 1
“X” v Sydney Children’s Hospitals Specialty Network cont.
(b)
the parties to the proceedings may identify the Plaintiff and her next friend for the
purposes of the administration of the public health system in the State of New South
Wales; and
(c)
references to previous judgments of the Court are not in breach of this order.
(2)
Publication in Australia of other material that would be likely to identify the Plaintiff, such as
the names of members of her family, is prohibited except that the Court and Court staff, the
parties to the proceedings and their legal representatives and witnesses in the proceedings
may identify them for the purposes of or associated with the proceedings.
(3)
For the purposes of orders (1) and (2), “parties” includes:
(a)
the Crown in right of the State of New South Wales, including but not limited to the
New South Wales Minister for Health and the Ministry of Health; and
(b)
the parties’ insurers and indemnity organisations.
(4)
The Plaintiff be otherwise identified by the pseudonym, “X”.
(5)
The Plaintiff’s next friend be otherwise identified by the pseudonym, “Y”.
(6)
These orders have effect until seven days after the close of evidence in the present proceedings,
subject to further order of the Court.

A v Bird; C v Bird
[1.298] A v Bird; C v Bird [2015] NSWSC 570
MCCALLUM J
[2]‌The first defendant in each proceeding is the alleged offender. In one set of proceedings, the
first plaintiff is a child allegedly sexually assaulted by the first defendant and the second plaintiff is
the mother of that child. The claim of the child alleges intentional assault by the first defendant and
negligence on the part of the second and third defendants in the conduct of the child care centre.
The mother claims damages for psychiatric or psychological injury caused by the same alleged events.
[3]‌In the other proceedings there is a single plaintiff, being the mother of a second child alleged
to have been assaulted by the first defendant. That mother also claims damages for psychological
or psychiatric injury caused by her becoming aware of the alleged assaults on her child. The child
concerned in that case is not a party to the proceedings.
…
[11] Express power to make orders of the kind now sought may be found in the Court Suppression
and Non-​Publication Orders Act. As reflected in s 6 of that Act, a primary objective of the administration
of justice is to safeguard the public interest in open justice.
[12] My attention was drawn during argument to the decision of the Court of Appeal in D1 v P1
[2012] NSWCA 314. The discernment of the principles established by that decision is complicated by
the fact that the judgment is published with substantial sections suppressed. As I read the judgment,
it was a case in which suppression orders had been sought in circumstances tolerably similar to
the present application, save for the fact the person seeking the orders and seeking to have his or
her identity protected by the orders was the perpetrator rather than the alleged victims of assaults.
Further, the basis for the application was s 8(1)(c) of the Act, which empowers the Court to make
an order where it is necessary to “protect the safety of any person”. Whilst it is not entirely clear,
having regard to the suppressed sections of the judgment, I apprehend that person was a person
who had a connection with the defendants as to whom the evidence suggested he or she was at
[1.298]
45
Civil Procedure in New South Wales
A v Bird; C v Bird cont.
risk of self-​harm if his or her identity were not suppressed. A different position exists in the present
case, where the orders are sought to protect the identity of the alleged complainants rather than the
alleged perpetrator.
[13] In any event, in a discussion of the relevant authorities, the Court in D1 v P1 noted that courts
will be solicitous to the effect litigation has on children. The judgment does not make clear whether
the person referred to as “X” was a child, but that appears to be the context in which reference to
those decisions was made. The Court also referred to the remarks of Mahoney JA in John Fairfax Group
Pty Ltd (Receivers & Managers Appointed) v Local Court (NSW) (1991) 26 NSWLR 131 at 163 to 164:
First, it is important to remember –​because, in what is said about the open conduct of the
courts, it appears sometimes to be forgotten –​that the open conduct of the courts can
cause great pain and loss to those touched by what is done and what is publicised. It is, in
my opinion, the function of the law –​and the obligation of the courts in administering it –​
to avoid such pain and loss to the extent that it is possible to do so. To the extent that this
detriment to the individual is not avoided, the law is deficient and the courts have been less
than fully effective.
Secondly, the assumption which, I think, sometimes emerges from what is urged for the
open conduct of courts is that that principle is to be upheld and the right to publish is to be
unrestricted notwithstanding that the individual suffers for it. If this assumption underlies the
submissions made in the present proceeding, it is an assumption which I would not accept. As
I have said, the principle that the courts are to be open and that the media may publish what
is done in them is not an end in itself. The principle is adopted because it is judged to be the
means by which other and more fundamental goods will be achieved. The power which the
community gives to any person, whether he be in Parliament, an official in government, or
a judge is to be exercised properly and accountably. And, it is believed, that will be achieved
if the power is exercised, as in the present case, in open court and subject to full publicity.
[14] It was observed at the conclusion of that extract in D1 v P1 that those remarks must now be
read subject to the provisions of the Court Suppression and Non-​Publication Orders Act. I would,
however, apprehend that the Court of Appeal did not intend in D1 v P1 to say anything contrary
to the proposition that open justice is not to be seen as an end in itself, but rather as a boon to the
administration of justice.
[15] In my view it is appropriate, where the interests of a child are at stake in the manner in which
litigation is conducted, to be solicitous to the effect such litigation may have on the child. It is in that
context that the provisions of s 15A of the Children (Criminal Proceedings) Act should be considered.
That Act evinces a plain intention that the identity of a child who is a victim of a sexual assault
should be protected and that the publication of the identity of such a child should be prohibited.
Subsection 5 recognises the obvious proposition that the identity of the mother of such a child ought
also be prohibited if its publication may lead to the identification of the child.
[16] It is appropriate, in my view, to read the provisions of the Court Suppression and Non-​Publication
Orders Act in a manner that gives coherence to those provisions of the Children (Criminal Proceedings)
Act. Accordingly, I am persuaded it is appropriate to make orders prohibiting, or at least restricting,
disclosure of the identity of the three plaintiffs and the child concerned in the second proceedings.

The provision of reasons for decision
[1.300] The “provision of reasons for decision is also an expression of the open court
principle”: Wainohu v New South Wales (2011) 243 CLR 181; 278 ALR 1; [2011] HCA 24
at [58] per French CJ and Kieffel J
46
[1.300]
Introduction to Civil Procedure
Chapter 1
Wainohu v New South Wales
[1.310] Wainohu v New South Wales (2011) 243 CLR 181; 278 ALR 1; [2011] HCA 24
[The plaintiff, a member and former President of the Sydney Chapter of the Hells Angels Motorcycle
Club, sought a declaration that the Crimes (Criminal Organisations Control) Act 2009 (NSW) was invalid.
Part 2 of the Act (ss 5–​13) provided that the Commissioner of Police may apply to an “eligible Judge”
of the Supreme Court for a declaration that a particular organisation is a “declared organisation”
for the purposes of the Act. Section 9(1) provided that the eligible Judge may make a declaration if
satisfied that:
(a) members of the organisation associate for the purpose of organising, planning,
facilitating, supporting or engaging in serious criminal activity, and
(b) the organisation represents a risk to public safety and order in this State.
Section 12 empowered an eligible Judge, on request by the Commissioner or on application by a
member of the organisation the subject of the declaration, to revoke the declaration. Section 13(2)
provided:
If an eligible Judge makes a declaration or decision under this Part [ie Pt 2], the eligible Judge
is not required to provide any grounds or reasons for the declaration or decision (other than
to a person conducting a review under section 39 if that person so requests).
Part 3 of the Act provided for the making of “interim control orders” (ss 14 –​ 18) and “control orders”
(ss 19–​25). Section 39 provided for the Ombudsman to scrutinise the exercise of powers conferred on
police officers under the Act and to furnish reports to the Attorney-​General and the Commissioner.]
FRENCH CJ and KIEFFEL J
[1]‌On 6 July 2010, the Acting Commissioner of Police for New South Wales applied to a judge
of the Supreme Court of New South Wales for a declaration under Pt 2 of the Crimes (Criminal
Organisations Control) Act 2009 (NSW) (“the Act”) in respect of the Hells Angels Motorcycle Club of
New South Wales (“the Club”). The declaration sought is an administrative, not a judicial act. The
judge from whom it is sought is an “eligible judge” so designated under the Act by the Attorney-​
General of New South Wales.
[2]‌If the eligible judge makes the declaration which is sought then, under Pt 3 of the Act, the
Supreme Court will be empowered, on the application of the Commissioner of Police, to make control
orders against individual members of the Club. A member against whom such an order is made is
called a “controlled member”. It is an offence for controlled members to associate with one another.
They are also barred from certain classes of business and occupation.
[3]‌The plaintiff, Derek Wainohu, is a member of the Club and has been a member for 20 years. If
the Club is declared as an organisation under the Act, he is at risk of being made subject to a control
order. He has commenced proceedings in this Court seeking a declaration that the Act is, or particular
provisions of it are, invalid. He challenges the Act’s validity on the basis that it confers functions
upon eligible judges and upon the Supreme Court which undermine the institutional integrity of that
Court in a way that is inconsistent with the national integrated judicial system for which Ch III of the
Constitution of the Commonwealth provides. …
[5]‌The Act creates two important functions, both of which are exercised by judges of the Supreme
Court of New South Wales. It was not in dispute that a declaration under Pt 2 made by an eligible
judge is an administrative act. Nor was it disputed that a control order under Pt 3 is a judicial act.
Although the two functions are linked as part of the one statutory scheme, the making of a declaration
under Pt 2 is neither an incident nor an element of the judicial function of making a control order
under Pt 3.
[6]‌An eligible judge may make a determination under Pt 2 upon information and submissions,
without regard to the rules of evidence, partly based on information and submissions not able to
be disclosed to the organisation or its members, and with no obligation to provide reasons for the
[1.310]
47
Civil Procedure in New South Wales
Wainohu v New South Wales cont.
determination which is made. The Act thus provides for the enlistment of judges of the Supreme
Court to determine applications for declarations using processes which, if adopted by the Court itself,
would be repugnant to the judicial function.
…
[58] The provision of reasons for decision is also an expression of the open court principle, which
is an essential incident of the judicial function. A court which does not give reasons for a final decision
or for important interlocutory decisions withholds from public scrutiny that which is at the heart of the
judicial function: the judicial ascertainment of facts, identification of the rules of law, the application
of those rules to the facts and the exercise of any relevant judicial discretion.
[59] Section 13(2) of the Act exempts an eligible judge from any duty to give reasons for making
or refusing to make a declaration, save for the purposes of a review by the Ombudsman under s 39
of the Act. That exemption marks a significant difference, among a number of significant differences,
between the functions conferred upon the judge and those conferred on the court of which he or she
is a member. The existence of that difference and the statutory context in which it arises are relevant
to the question whether the function conferred upon the eligible judge impairs the institutional
integrity of the Supreme Court of New South Wales.
[Order: “The Crimes (Criminal Organisations Control) Act 2009 (NSW) is invalid”.]
[footnotes omitted]

PRINCIPLE OF A FAIR TRIAL
[1.320] The principle of a fair trial is recognised in criminal proceedings: see Dietrich v R
(1992) 177 CLR 292; Jago v District Court of New South Wales (1989) 168 CLR 23; R v
Macfarlane; Ex parte O’Flanagan (1923) 32 CLR 518 at 541–​542. The principle of a fair trial
is also recognised in the conduct of civil proceedings. For example, the function of providing
proper notice is fundamental to the basic requirement of procedural fairness: Banque
Commerciale SA (in liq) v Akhil Holdings Ltd (1990) 169 CLR 279 at 286 (which is discussed
in Chapter 9).
The Truth Can Cost Too Much
[1.330] J Spigelman, “The Truth Can Cost Too Much: The Principle of a Fair Trial” (2004) 78 ALJ
29 at 30
The principle of a fair trial now informs and energises many areas of the law. It is reflected in
numerous rules and practices. It is continually adapted to new and changing circumstances.
As will presently appear, the principle of a fair trial manifests itself in virtually every aspect of
our practice and procedure, including the laws of evidence. There is, however, an overriding and,
perhaps, unifying principle. As Deane J put it:
it is desirable that the requirement of fairness be separately identified since it transcends
the content of more particularized legal rules and principles and provides the ultimate
rationale and touchstone of the rules and practices which the common law requires to be
observed in the administration of the substantive criminal law. [Dietrich v R (1992) 177 CLR
292 at 326]
48
[1.320]
Introduction to Civil Procedure
Chapter 1
The Truth Can Cost Too Much cont.
As will appear from the cases to which I will refer, it is in the context of the criminal law that the
principle receives its most complete exposition. However, the principle is, of course, equally applicable
to civil proceedings.
Over the course of the last fifteen years or so the significance of the principle of a fair trial has
been characterised in numerous High Court judgments in the most forceful of terms: as “the central
thesis of the administration of criminal justice” [McKinney v R (1991) 171 CLR 468 at 478]; as “the
central prescript of our criminal law” [Jago v District Court of NSW (1989) 168 CLR 23 at 56]; as a
“fundamental element” or a “fundamental prescript” [Dietrich v R (1992) 177 CLR 292 at 299, 326];
and as an “overriding requirement” [Dietrich at 330].
The High Court has, over about fifteen years, given the principle of a fair trial considerable emphasis
and elaboration. It is not, however, a new principle. As Isaacs J put it in 1923, with reference to “the
elementary right of every accused person to a fair and impartial trial”:
Every conviction set aside, every new criminal trial ordered, are mere exemplifications of this
fundamental principle. [See R v MacFarlane; Ex parte O’Flanaghan and O’Kelly (1923) 32 CLR
518 at 541-​542.]
It is not entirely accurate to refer to the principle in terms of a “right to a fair trial” [see Jago v The
District Court of New South Wales (1989) 168 CLR 23 at 56–​57]. Nevertheless it is convenient and “not
unduly misleading” to do so [see Dietrich v The Queen (1992) 177 CLR 292 at 299, 326].
There are numerous jurisdictions in which a right to a fair trial is enshrined, in those terms, either
in a Constitution or in a statute of general, and often overriding, application. That is not the case
in Australia. The terminology of “right” appears to be more appropriate in circumstances where
something in the nature of a freestanding right is specifically enacted. I use the words “principle
of a fair trial”, rather than “right to a fair trial”, in order to emphasise that what is involved in our
jurisprudence is a standard of an inherently flexible character.
A principle, as Ronald Dworkin has identified:
states a reason that argues in one direction but does not necessitate a particular decision …
There may be other principles or policies arguing in the other direction … If so, our principle
may not prevail, but that does not mean that it is not a principle of our legal system, because
in the next case, when these contravening considerations are absent or less weighty, the
principle may be decisive. [Ronald Dworkin, Taking Rights Seriously, Duckworth, London
(1977) p 26]
Although issues of balancing and reconciliation of conflicting or intersecting rights also arise in a
rights based system, the terminology of “principle” rather than of “right” identifies that in our legal
system the significance and weight to be given to fair trial considerations will vary from one set of
circumstances to another, perhaps to a greater degree than in a rights based system.
…
In Australian jurisprudence, the principle of a fair trial is based on the inherent power of a court
to control its own processes and, particularly, on its power to prevent abuse of its processes. As the
majority joint judgment said in Walton v Gardiner [(1993) 177 CLR 378 at 392-​393 per Mason CJ,
Deane and Dawson JJ]:
The inherent jurisdiction of a superior court to stay its proceedings on grounds of abuse of
process extends to all those categories of cases in which the processes and procedures of the
court, which exist to administer justice with fairness and impartiality, may be converted into
instruments of injustice and unfairness.
A court may become an “instrument of injustice and unfairness” in ways other than by infringement
of the principle of a fair trial. The institution of proceedings or the reliance by a party, particularly
the prosecution, on certain evidence, may involve the court in prior illegality or improper conduct.
[1.330]
49
Civil Procedure in New South Wales
The Truth Can Cost Too Much cont.
The court cannot turn a blind eye to vexatious and oppressive conduct that has occurred in relation
to proceedings, even if a fair trial is still possible. Such conduct could, if tolerated by the courts,
undermine the standing of the judges as impartial and independent adjudicators.
In Jago, Mason CJ concluded that the power to prevent abuse of process extended to a power to
prevent unfairness generally:
The question is … whether the court, whose function is to dispense justice with impartiality
both to the parties and to the community which it serves, should permit its processes to be
employed in a manner which give rises to unfairness. [(1989) 168 CLR 23 at 28]
Courts have an overriding duty to maintain public confidence in the administration of justice which,
as Justice Gummow has said, “in present times, is the meaning of the ancient phrase ‘the majesty of
the law’ ”. [Mann v O’Neil (1997) 191 CLR 204 at 245]
…
Constitutional significance
The focus of constitutional jurisprudence of the High Court over recent years has been on
Chapter III. It seems quite likely that certain aspects of the principle of a fair trial will be found to
have a measure of constitutional protection. As Brennan, Deane and Dawson JJ pointed out in Chu
Kheng Lim [Chu Kheng Lim v The Minister for Immigration, Local Government and Ethnic Affairs (1992)
176 CLR 1 at 27, see also 37, 55 and 68], the legislative power of the Commonwealth does not
extend:
to the making of a law which requires or authorizes the courts in which the judicial power
of the Commonwealth is exclusively vested to exercise judicial power in a manner which is
inconsistent with the essential character of a court or with the nature of judicial power.
There is now a significant body of observations by different judges of the High Court to similar
effect [see Polyukhovich v Commonwealth (1991) 172 CLR 501 at 607 per Deane J and 703–​704 per
Gaudron J; Nicholas v R (1998) 193 CLR 173 at 185 [13]-​[14] per Brennan CJ, 208 [73] per Gaudron J,
220-​221 [112] per McHugh J, 232 [146] per Gummow J. See also Justice McHugh, “Does Chapter III
of the Constitution protect substantive as well as procedural rights?” (2001) 21 Aust Bar Rev 235 esp
at 237-​241; F Wheeler, “The Doctrine of Separation of Powers and Constitutionally Entrenched Due
Process in Australia” (1997) 23 Monash L Rev 248; W Lacey, “Inherent Jurisdiction, Judicial Power and
Implied Guarantees Under Chapter III of the Constitution” (2003) 31 Fed Law Rev 57]. Some identify
particular matters as constituting essential characteristics of the judicial process which Parliament
may not infringe [Harris v Caladine (1991) 172 CLR 84 at 150; Re Nolan; Ex parte Young (1991) 172
CLR 460 at 496; Polyukhovich v Commonwealth (1991) 172 CLR 501 at 703–​704; Nicholas v R (1998)
193 CLR 173 at [73]–​[74]]. One of the issues that has divided the Court in recent times, and which
remains unresolved, is whether such constitutional protection as exists of the court’s power to protect
the integrity of its processes, extends to the court acting on the basis that it should maintain public
confidence in the administration of justice [see Nicholas v R (1998) 193 CLR 173 at 197 [37] per
Brennan CJ and 276 [242] per Hayne J; contra at 209 [74] per Gaudron J, 226 [127] per McHugh J,
256 [201] per Kirby J; Grollo v Palmer (1995) 184 CLR 348 at 365; Wilson v Minister for Aboriginal and
Torres Strait Islander Affairs (1996) 189 CLR 1 at 14, 17; Kable v Director of Public Prosecutions (NSW)
(1996) 189 CLR 51 at 98 per Toohey J, 107 per Gaudron J, 117, 118–​19 and 124 per McHugh J,
113–​34 per Gummow J].
The dominant view now appears to be that some form of protection of procedural rights is inherent
in Chapter III, although there is no clear majority decision to that effect. As the joint judgment of
Mason CJ, Dawson and McHugh JJ said in Leeth [see Leeth v Commonwealth (1992) 174 CLR 455 at
470. See also Grollo v Palmer (1995) 184 CLR 348 at 365; Kable v Director of Public Prosecutions (NSW)
(1996) 189 CLR 51 at 98, 107, 117, 118-​119, 121, 124 and 133-​134; John Fairfax Publications Pty Ltd
v Attorney General (NSW) (2000) 158 FLR 81 at 85-​86 [19]-​[27]]:
50
[1.330]
Introduction to Civil Procedure
Chapter 1
The Truth Can Cost Too Much cont.
It may well be that any attempt on the part of the legislature to cause a court to act in a
manner contrary to natural justice would impose a non-​judicial requirement inconsistent
with the exercise of judicial power …
Whatever the implications that may be found in Chapter III, it seems likely that the principle of a fair
trial will be more readily discovered there than many others that have been suggested [see eg Dietrich
v R (1992) 177 CLR 292 at 336 per Deane J and 362 per Gaudron J; Kruger v Commonwealth (1997)
120 CLR 1 at 63 per Dawson J and 112 per Gaudron J; Roberts v Bass (2003) 77 ALJR 292 at [145] per
Kirby J; Wheeler, n 23].
…
In the same way as has occurred with the principle of open justice [The Hon JJ Spigelman, “Seen to
be Done: The Principle of Open Justice –​Part I” (2000) 74 ALJ 290 esp at 293], the principle of a fair trial
has become so fundamental an axiom of Australian law as to be entitled to constitutional significance.
The subject of constitutional law should not be limited solely to the exegesis of the terminology
of a written document called “The Constitution”. Our constitution, like the British constitution,
includes a number of statutes and principles of the common law which are theoretically capable of
amendment by Parliament. Nevertheless, the fundamental nature of these laws and principles, and
the improbability of substantial modification by legislation, is such as to justify treating such laws and
principles as part of our constitutional law in its broadest sense. This is so of the principle of a fair trial
[see, eg, R v Brown (Winston) [1994] 1 WLR 1599 at 1606E].
…
Trial procedure
… The obligation to obey the rules of natural justice, once referred to in terms of the duty to act
judicially and now more frequently adverted to in terms of observing procedural fairness, applies with
particular force to judicial proceedings.
All of the requirements of a fair hearing, including reasonable notice of the case a person has to
meet and the provision of a reasonable opportunity of presenting his or her case, as reflected in a
series of detailed rules and practices, are manifestations of the principle with which I am concerned
in this address.
The basic building blocks of adversary proceedings in our legal system are similarly so informed.
The imposition of an onus of proof and the differentiation of the standard of proof between civil and
criminal proceedings, reflect an understanding of what fairness requires in the particular circumstances,
relevantly, if the particular stigma of a criminal conviction is to be attached to a citizen.
All of the detailed rules and practices with respect to when notice or disclosure is required, when an
adjournment is appropriate and the order of proceedings, particularly the right of cross-​examination,
have as their source centuries of consideration by generations of judges of the interaction, sometimes
synergistic, sometimes in conflict, between the search for truth and the requirements of a fair hearing.

[1.340] In Stead v State Government Insurance Commission (1986) 161 CLR 141, the High
Court found that there was a miscarriage of justice caused by a failure of a trial judge to
provide a fair trial.
Stead v State Government Insurance Commission
[1.350] Stead v State Government Insurance Commission [1986] HCA 54; (1986) 161 CLR 141
[In an action for negligence arising out of a motor accident, an issue was whether the plaintiff
[applicant] developed a neurotic condition from the accident. Whether the accident which resulted
[1.350]
51
Civil Procedure in New South Wales
Stead v State Government Insurance Commission cont.
from the defendant’s [respondent] negligence was the cause or a material factor contributing to the
condition was a major issue at the trial. Both sides relied on evidence. The defendant relied on medical
evidence, including a report of a psychiatrist, Dr Scanlon.
At the trial, when the plaintiff’s counsel came to his closing address, he submitted that his Honour
should not accept Dr Scanlon’s evidence that the accident had nothing to do with the neurotic
condition. This elicited from his Honour the comment, “Alright. I don’t accept Dr Scanlon on that.
You needn’t go on as to that.” The plaintiff’s counsel did not develop the submission and addressed
no further argument on the acceptability of Dr Scanlon’s evidence on the issue of causation. However,
when the trial judge delivered judgment he specifically accepted Dr Scanlon’s testimony that there
was “no relation between the subject accident and his behaviour” and therefore he found that the
defendant’s negligence did not cause or materially contribute to the condition. The plaintiff appealed
on the basis that by stopping the plaintiff’s counsel from addressing the topic of Dr Scanlon’s evidence
with respect to causation, the trial judge had deprived the plaintiff of an opportunity of presenting
argument on a vital issue in the case. The Full Court of the Supreme Court of South Australia (Bollen J
with whom King CJ and Prior J agreed) dismissed the appeal and said: “the enquiry whether a
miscarriage of justice has occurred involves asking whether the event said to cause a miscarriage could
have made any difference to the result.” The plaintiff appealed to the High Court.]
MASON, WILSON, BRENNAN, DEANE and DAWSON JJ
[9]‌The general principle applicable in the present circumstances was well expressed by the English
Court of Appeal (Denning, Romer and Parker LJJ) in Jones v National Coal Board (1957) 2 QB 55, at
p 67, in these terms:
There is one thing to which everyone in this country is entitled, and that is a fair trial at which
he can put his case properly before the judge. … No cause is lost until the judge has found
it so; and he cannot find it without a fair trial, nor can we affirm it.
That general principle is, however, subject to an important qualification which Bollen J plainly had in
mind in identifying the practical question as being: Would further information possibly have made
any difference? That qualification is that an appellate court will not order a new trial if it would
inevitably result in the making of the same order as that made by the primary judge at the first trial.
An order for a new trial in such a case would be a futility.
[10] For this reason not every departure from the rules of natural justice at a trial will entitle the
aggrieved party to a new trial. By way of illustration, if all that happened at a trial was that a party
was denied the opportunity of making submissions on a question of law, when, in the opinion of the
appellate court, the question of law must clearly be answered unfavourably to the aggrieved party, it
would be futile to order a new trial.
[11] Where, however, the denial of natural justice affects the entitlement of a party to make
submissions on an issue of fact, especially when the issue is whether the evidence of a particular
witness should be accepted, it is more difficult for a court of appeal to conclude that compliance with
the requirements of natural justice could have made no difference. True it is that an appeal to the
Full Court from a judgment or order of a judge is by way of rehearing and that on hearing such an
appeal the Full Court has all the powers and duties of the primary judge, including the power to draw
inferences of fact (Supreme Court Rules O 58, rr 6 and 14). However, when the Full Court is invited by
a respondent to exercise these powers in order to arrive at a conclusion that a new trial, sought to
remedy a denial of natural justice relevant to a finding of fact, could make no difference to the result
already reached, it should proceed with caution. It is no easy task for a court of appeal to satisfy itself
that what appears on its face to have been a denial of natural justice could have had no bearing on
the outcome of the trial of an issue of fact. And this difficulty is magnified when the issue concerns the
acceptance or rejection of the testimony of a witness at the trial.
[12] This is just such a case. At the trial the critical question on the issue of causation was
whether Dr Scanlon’s testimony should have been accepted in preference to the appellant’s expert
52
[1.350]
Introduction to Civil Procedure
Chapter 1
Stead v State Government Insurance Commission cont.
witnesses, notably Dr Donsworth. It was an issue pre-​eminently suitable for determination by the
primary judge who had an advantage over the Full Court in seeing and assessing the witnesses.
We do not see how the Full Court, denied the important advantage of seeing and assessing the
witnesses, could satisfactorily conclude that had the appellant’s counsel been given a reasonable
opportunity to present submissions on the issue, it could have made no possible difference to the
result. ….
[13] It is significant that Bollen J, after referring to “the forcefully and attractively presented
arguments” of Mr Anderson for the appellant, made this comment:
they were arguments fit for offering to the trial judge but not on appeal. There was evidence
which could have led to the rejection of Dr Scanlon’s opinion. But it was for the trial judge to
say. He had the inestimable advantage of seeing and hearing the witnesses.
Later Bollen J said:
In my opinion, the learned trial judge was perfectly entitled to accept the evidence of
Dr Scanlon. It was his evidence which the learned trial judge found acceptable. It was entirely
open for him to so find.
[14] These statements do not suggest that his Honour considered that the primary judge was bound
to find the issue of fact in favour of the respondent or that the finding of fact was the only finding
reasonably open on the evidence. Instead they imply that the issue was rather finely balanced, an
assessment which accords with the primary judge’s reaction. Initially he had been disposed to reject
Dr Scanlon, but on mature reflection he had come to the opposite conclusion.
[15] It is natural that Bollen J expressed himself as he did in the passages which we have quoted.
He was conscious that, not having seen the witnesses, he could not evaluate their evidence in the way
in which a trial judge can. It is for this very reason that, in our view, the Full Court was disabled in the
circumstances of this case from reaching a sound conclusion that a new trial in which the applicant’s
counsel would have an adequate opportunity of presenting submissions on the issue of causation
could make no difference to the result.
[16] Alternatively, if the Full Court is properly to be understood as saying no more than that a
new trial would probably make no difference to the result, their Honours failed to apply the correct
criterion. All that the appellant needed to show was that the denial of natural justice deprived him
of the possibility of a successful outcome. In order to negate that possibility, it was, as we have said,
necessary for the Full Court to find that a properly conducted trial could not possibly have produced
a different result. …
[19] The appeal should be allowed, and a new trial ordered limited, as was the first trial, to the
issue of damages.

[1.360] Stead v State Government Insurance Commission (1986) 161 CLR 141 was applied
in Mastronardi v NSW [2007] NSWCA 54 where the NSW Court of Appeal found error
and was required to consider the Supreme Court Rules 1970 (NSW) Pt 51, r 23 (now UCPR
r 51.53) which provides that an appeal court can order a new trial if it appears to the court
that “some substantial wrong or miscarriage” has been occasioned. The Court of Appeal
found that the relevant miscarriage was a failure to provide a fair trial (see Mastronardi v
NSW [2007] NSWCA 54 at [81]–​[82]). The Court of Appeal found that the plaintiff did not
have a fair trial according to law where part of the evidence was misapprehended and part
was not relied upon.
[1.360]
53
Civil Procedure in New South Wales
Mastronardi v New South Wales
[1.370] Mastronardi v New South Wales [2007] NSWCA 54
[Facts: On 29 November 1998, Mr Mastronardi, who was a prisoner in the Metropolitan Remand
and Reception Centre, Silverwater, was seriously assaulted in his cell by a number of fellow prisoners.
He gave evidence at trial that he had been assaulted because he was recognised as a former security
guard. Mr Mastronardi brought proceedings in negligence against the State of New South Wales
because prison officers failed to provide protection against a threat of physical attack. The trial judge
rejected Mr Mastronardi’s claim. He appealed from this decision.
The issues for the Court of Appeal were: … (iii) whether some substantial wrong or miscarriage had
thereby been occasioned to allow for the ordering of a new trial pursuant to Supreme Court Rules
Pt 51 r 23 (now UCPR 51.53). The Court set aside the judgment below and ordered a new trial.
The power of the Court to order a retrial is constrained by the requirement of UCPR 51.53:
(1)
The Court must not order a new trial on any of the following grounds:
(a)
misdirection, non-​direction or other error of law,
(b)
improper admission or rejection of evidence,
(c)
that the verdict of the jury below was not taken on a question that the trial judge was
not asked to leave to the jury,
(d)
on any other ground,
unless it appears to the Court that some substantial wrong or miscarriage has been thereby
occasioned.]
BASTEN JA (IPP and CAMPBELL JJA agreeing)
[81] Given the requirement under Pt 51 r 23 for a court to be affirmatively satisfied that “some
substantial wrong or miscarriage” has been occasioned, it is possible that a different result could
obtain in demeanour-​based assessments where the appellate court discerns error, but is unable to say
whether a correct assessment could or would have led to a different result. That is precisely the kind
of case where a new trial is a relevant option. It would mean that a new trial could rarely be obtained
if the question of injustice is to be assessed by reference to the ultimate outcome of the case.
[82] That dilemma can be avoided by identifying the relevant miscarriage as a failure to provide a
trial in which, in a significant respect, the assessment of the evidence was not flawed. The important
distinction between a trial with a jury and a trial with judge alone is that in the former case the
error said to justify intervention will usually arise outside the process of assessing the evidence.
The question of injustice or miscarriage then requires an evaluation of the effect of the error on
the assessment process. (The principal exception, in a criminal case, arises where it is said that a
verdict is “unreasonable, or cannot be supported, having regard to the evidence” –​a claim which
identifies an error in the actual assessment process, although that process is opaque, by comparing
the evidence with the outcome.)
[83] In a trial with a judge alone, the assessment process is not opaque, but is (or should be)
exposed in reasons for judgment. If a relevant and material error is revealed, as with an unreasonable
criminal verdict, there will be little room for the operation of the constraint relating to a substantial
miscarriage of justice. In such a case the Court should apply the principle established in Stead v State
Government Insurance Commission [1986] HCA 54; (1986) 161 CLR 141. …
[86] In the present case, as in NAIS, it may properly be said that the Appellant did not have a fair
trial according to law. In terms of procedural fairness, as applicable in judicial review proceedings, this
was a hearing where part of the evidence was misapprehended and part was not relied upon, thereby
constituting something other than “a hearing where the evidence given is to be given proper, genuine
and realistic consideration in the decision subsequently to be made”: NAIS v Minister for Immigration
and Multicultural and Indigenous Affairs [2005] HCA 77 at [171] (Callinan and Heydon JJ). Adapting
the remarks of Gleeson CJ in Re Refugee Review Tribunal; Ex parte Aala [2000] HCA 57; (2000) 204 CLR
54
[1.370]
Introduction to Civil Procedure
Chapter 1
Mastronardi v New South Wales cont.
82 at [4]‌, albeit in a case where the Tribunal had taken into account material of which the prosecutor
was not aware, it is possible that, even if the trial judge had given careful and accurate attention to
all of the evidence, he would ultimately have come to the same conclusion. Gleeson CJ continued:
But no one can be sure of that. Decisions as to credibility are often based upon matters of
impression, and an unfavourable view taken upon an otherwise minor issue may be decisive.
[87] … Because the Appellant did not have a trial untainted by material factual errors, he can properly
complain that he has not had his case considered according to law. That in itself constitutes a
substantial miscarriage of justice, a phrase which cannot be limited to an assessment of the ultimate
outcome, particularly where it is not in the power of this Court to make that assessment for itself. In
my view the Appellant is entitled to a retrial.
[The appellant was unsuccessful in the new trial and subsequent appeal: Mastronardi v State of New
South Wales [2009] NSWCA 270.]

THE CROWN AS THE MODEL LITIGANT
[1.380] Lawyers acting for the government are required to ensure their client acts as a model
litigant. In Melbourne Steamship Co v Moorehead (1912) 15 CLR 333, Griffith CJ at 342
observed that there was a “standard of fair play to be observed by the Crown in dealing with
its subjects”. In Melbourne Steamship, the High Court found that the Crown should not take
a “purely technical point of pleading”. The courts also expect the Crown to pursue the public
interest when it appears as a litigant: Hughes Aircraft Systems International v AirServices
Australia (1997) 76 FCR 151. In Hughes Aircraft Systems, Finn J observed at 196 that the
Crown should act “fairly towards those with whom it deals at least insofar as this is consistent
with its obligation to serve the public interest (or interests) for which it has been created”.
The public interest that model litigants are to serve requires that they eschew technicality and
pursue fairness in the conduct of proceedings.
The Crown has its own policies for model litigant behaviour. The Commonwealth and all
States have adopted model litigant rules. A model litigant is required to act with complete
propriety, fairly and in accordance with the highest professional standards. In New South
Wales, the Model Litigant Policy for Civil Litigation in NSW was endorsed by Cabinet on 8
June 2008. The Commonwealth’s model litigation policy is to similar effect.2
Model Litigant Policy for Civil Litigation
[1.390] New South Wales Model Litigant Policy for Civil Litigation
Guidelines for the appropriate conduct of litigation by government agencies. This policy was
approved for adoption by all government agencies on 8 July 2008.
Introduction
[1.1] This Policy has been endorsed by Cabinet to assist in maintaining proper standards in litigation
and the provision of legal services in NSW. This Policy is a statement of principles. It is intended to
2
Clause 4.2 of the Legal Services Directions imposes the model litigant obligation, and that obligation is set
out in Appendix B to the Directions.
[1.390]
55
Civil Procedure in New South Wales
Model Litigant Policy for Civil Litigation cont.
reflect the existing law and is not intended to amend the law or impose additional legal or professional
obligations upon legal practitioners or other individuals.
[1.2] This Policy applies to civil claims and civil litigation (referred to in this Policy as litigation),
involving the State or its agencies including litigation before courts, tribunals, inquiries and in
arbitration and other alternative dispute resolution processes.
[1.3] Ensuring compliance with this Policy is primarily the responsibility of the Chief Executive
Officer of each individual agency in consultation with the agency’s principal legal officer. In addition,
lawyers, whether in-​house or private, are to be made aware of this Policy and its obligations.
[1.4] Issues relating to compliance or non-​compliance with this Policy are to be referred to the
Chief Executive Officer of the agency concerned.
[1.5] The Chief Executive Officer of each agency may issue guidelines relating to the interpretation
and implementation of this Policy.
[1.6] This Policy supplements but does not replace existing Premier’s Memoranda relating to
Government litigation, in particular Premier’s Memoranda nos 94-​25, 97-​26, and 95-​39.
The obligation
[2]‌The State and its agencies must act as a model litigant in the conduct of litigation.
Nature of the obligation
[3.1] The obligation to act as a model litigant requires more than merely acting honestly and in
accordance with the law and court rules. It also goes beyond the requirement for lawyers to act in
accordance with their ethical obligations. Essentially it requires that the State and its agencies act with
complete propriety, fairly and in accordance with the highest professional standards.
[3.2] The obligation requires that the State and its agencies, act honestly and fairly in handling
claims and litigation by:
a)
dealing with claims promptly and not causing unnecessary delay in the handling of claims and
litigation;
b)
paying legitimate claims without litigation, including making partial settlements of claims or
interim payments, where it is clear that liability is at least as much as the amount to be paid;
c)
acting consistently in the handling of claims and litigation;
d)
endeavouring to avoid litigation, wherever possible. In particular regard should be had to
Premier’s Memorandum 94-​25 Use of Alternative Dispute Resolution Services By Government
Agencies and Premier’s Memorandum 97-​26 Litigation Involving Government Agencies;
e)
where it is not possible to avoid litigation, keeping the costs of litigation to a minimum,
including by:
i)
not requiring the other party to prove a matter which the State or an agency knows to
be true; and
ii)
not contesting liability if the State or an agency knows that the dispute is really about
quantum;
f)
not taking advantage of a claimant who lacks the resources to litigate a legitimate claim;
g)
not relying on technical defences unless the interests of the State or an agency would
be prejudiced by the failure to comply with a particular requirement and there has been
compliance with Premier’s Memorandum 97-​26;
h)
not undertaking and pursuing appeals unless the State or an agency believes that it has
reasonable prospects for success or the appeal is otherwise justified in the public interest.
The commencement of an appeal may be justified in the public interest where it is necessary
to avoid prejudice to the interest of the State or an agency pending the receipt or proper
56
[1.390]
Introduction to Civil Procedure
Chapter 1
Model Litigant Policy for Civil Litigation cont.
consideration of legal advice, provided that a decision whether to continue the appeal is made
as soon as practicable; and
i)
apologising where the State or an agency is aware that it or its lawyers have acted wrongfully
or improperly.
[3.3] The obligation does not require that the State or an agency be prevented from acting firmly
and properly to protect its interests. It does not prevent all legitimate steps being taken in pursuing
litigation, or from testing or defending claims made.
[3.4] In particular, the obligation does not prevent the State or an agency from:
a)
enforcing costs orders or seeking to recover costs;
b)
relying on claims of legal professional privilege or other forms of privilege and claims for public
interest immunity;
c)
pleading limitation periods;
d)
seeking security for costs;
e)
opposing unreasonable or oppressive claims or processes;
f)
requiring opposing litigants to comply with procedural obligations; or
g)
moving to strike out untenable claims or proceedings.

THE RIGHT TO A FAIR TRIAL RECOGNISED IN HUMAN RIGHTS
LEGISLATION
[1.400] Australia, unlike most common law countries, does not have a national human rights
Act or Charter. However, it is noted that a Human Rights Bill 1973 (Cth) was introduced
into the Australian Parliament by the then Commonwealth Attorney-​General Lionel Murphy
during the Whitlam government. The Bill sought to implement the International Covenant on
Civil and Political Rights (ICCPR). The Bill lapsed in 1974 after being strongly opposed by
the opposition. A second Bill was introduced as the Australian Human Rights Bill 1985 (Cth).
Again, this Bill was defeated by the opposition. Australia does not have national human rights
legislation, and this could be isolating it from the jurisprudence that is rapidly developing in
other common law countries such as England. See further Spigelman J, The Common Law
Bill of Rights delivered at the University of Queensland in the 2008 McPherson Lectures,
Brisbane, Australia, 11 March 2008.
There are two statutory human rights Acts in two Australian jurisdictions: the Charter of
Human Rights and Responsibilities Act 2006 (Vic) and the Human Rights Act 2004 (ACT).
Both include a right to a fair hearing and follow Art 14(1) of the ICCPR.
International Covenant on Civil and Political Rights
[1.410] International Covenant on Civil and Political Rights, Art 14
Article 14(1) All persons shall be equal before the courts and tribunals. In the determination of any
criminal charge against him, or of his rights and obligations in a suit at law, everyone shall be entitled
to a fair and public hearing by a competent, independent and impartial tribunal established by law.
The press and the public may be excluded from all or part of a trial for reasons of morals, public
[1.410]
57
Civil Procedure in New South Wales
International Covenant on Civil and Political Rights cont.
order (order public) or national security in a democratic society, or when the interest of the private
lives of the parties so requires, or to the extent strictly necessary in the opinion of the court in special
circumstances where publicity would prejudice the interests of justice; but any judgement rendered
in a criminal case or in a suit at law shall be made public except where the interest of juvenile persons
otherwise requires or the proceedings concern matrimonial disputes or the guardianship of children.

Human Rights Act 2004 (ACT)
[1.420] Human Rights Act 2004 (ACT) s 21
21 Fair trial
(1)
Everyone has the right to have criminal charges, and rights and obligations recognised by law,
decided by a competent, independent and impartial court or tribunal after a fair and public
hearing.
(2)
However, the press and public may be excluded from all or part of a trial –​
(3)
(a)
to protect morals, public order or national security in a democratic society; or
(b)
if the interest of the private lives of the parties require the exclusion; or
(c)
if, and to the extent that, the exclusion is strictly necessary, in special circumstances of
the case, because publicity would otherwise prejudice the interests of justice.
But each judgment in a criminal or civil proceeding must be made public unless the interest
of a child requires that the judgment not be made public.

Charter of Human Rights and Responsibilities Act 2006 (Vic)
[1.430] Charter of Human Rights and Responsibilities Act 2006 (Vic) s 24
24 Fair hearing
(1)
A person charged with a criminal offence or a party to a civil proceeding has the right to
have the charge or proceeding decided by a competent, independent and impartial court or
tribunal after a fair and public hearing.
(2)
Despite subsection (1), a court or tribunal may exclude members of media organisations or
other persons or the general public from all or part of a hearing if permitted to do so by a law
other than this Charter.
For example, section 19 of the Supreme Court Act 1986 sets out the circumstances in which the
Supreme Court may close all or part of a proceeding to the public. See also section 80AA of
the County Court Act 1958 and section 126 of the Magistrates’ Court Act 1989.
(3)
All judgments or decisions made by a court or tribunal in a criminal or civil proceeding must
be made public unless the best interests of a child otherwise requires or a law other than this
Charter otherwise permits.

[1.440] The Victorian and ACT legislation imposes an obligation on the judiciary to
interpret all legislation in a way that is compatible with protected human rights “so far as it
58
[1.420]
Introduction to Civil Procedure
Chapter 1
is possible to do so consistently with its purpose” (see s 32 of the Charter of Human Rights
and Responsibilities Act 2006 (Vic) and s 30 of the Human Rights Act 2004 (ACT)). Both
Australian statutes allow for a strong rebuttable presumption in favour of rights-​consistent
interpretation of legislation, which is avoided only by clear legislative words or intention
to the contrary. The Victorian Solicitor-​General has observed that s 32 of the Charter of
Human Rights and Responsibilities Act 2006 (Vic) “is likely to mean that where there is a
range of interpretations to be adopted, all of which are equally consistent with the purpose
of the legislation, the interpretation which is least restrictive of human rights should be
adopted and assessed for compatibility”. (Pamela Tate SC, The Charter of Human Rights and
Responsibilities: A Practical Introduction (paper presented to the Victorian Bar Association,
Melbourne, 2 March 2007)).
Where a judge determines that a statutory provision in some way limits a human right or is
incompatible with the right, it is then necessary for the judge to consider whether “reasonable
limits as can be demonstrably justified in a free and democratic society based on human
dignity, equality and freedom” (s 7 of the Charter of Human Rights and Responsibilities Act
2006 (Vic) and s 28 of the Human Rights Act 2004 (ACT)). A judge is required to balance the
following factors: (1) the nature of the right; (2) the importance of the purpose of the right;
(3) the nature and extent of the limitation; (4) the relationship between the limitation and its
purposes; and (5) any less restrictive means reasonably available to achieve the purpose that
the limitation seeks to achieve. So where a statutory provision in some way limits a human
right but can be demonstrably justified as a “reasonable limit”, then the provision will not be
incompatible with the right.
If the Australian legislation cannot be read compatibly, the judiciary does not have power
to invalidate it but instead may issue an enforceable “declaration of inconsistent application”
(s 36 of the Charter of Human Rights and Responsibilities Act 2006 (Vic) and s 32 of the Human
Rights Act 2004 (ACT)). A declaration does not affect the validity, operation or enforcement
of the legislation or create in any person any legal right or give rise to any civil cause of
action. The declaration informs Parliament that it needs to review the rights assessment of
the relevant legislation. Parliamentary sovereignty is retained, as it is for Parliament to decide
whether or not, and how, to amend the impugned legislation. The Victorian Law Reform
Commission in its Civil Justice Review: Report (2008) considered the Charter.
Civil Justice Review –​Human Rights Considerations
[1.450] Victorian Law Reform Commission, Civil Justice Review, Report No 14 (2008) p 83
Human rights considerations are of increasing relevance to the law governing the conduct of civil
proceedings and to legal conceptions of what amounts to a fair trial or a just decision [see generally
Joseph M Jacob, Civil Justice in the Age of Human Rights (2007)].
…
Apart from the direct operation of the Charter, Article 14.1 of the ICCPR provides that “everyone
shall be entitled to a fair and public hearing by a competent, independent and impartial tribunal
established by law”. Australia has ratified the ICCPR and also the supplementary Optional Protocol,
which confers a right of persons affected to complain to the United Nations Human Rights Committee
if Australian law does not comply with these human rights provisions.
In Smits v Roach [(2006) 228 ALR 262], the High Court considered the question of whether the
failure of a NSW Supreme Court judge to make early disclosure of the fact that his brother was a
partner of the law firm which was a party to the proceedings before him gave rise to apprehended
[1.450]
59
Civil Procedure in New South Wales
Civil Justice Review – Human Rights Considerations cont.
bias and, if it did, whether there had been waiver of the right to object to the proceedings being
determined by that judge. In his judgment Justice Kirby referred to the significance of Australia’s
obligations under international law and noted that the essential features of the due administration
of justice sought to be protected by the ICCPR are also part of Australia’s domestic law [at
[102]–​[105]].
In the United Kingdom (UK), the introduction of the Human Rights Act 1998 has had a significant
impact on civil procedure and on the Civil Procedure Rules. This is notwithstanding the concern of
Lord Woolf to ensure that human rights law did not unduly affect case management decisions. [See
Daniels v Walker, also known as D (a child) v Walker and D v Walker (Practice Note) [2000] 1 WLR
1382, Court of Appeal, 1387. The case arose out of concerns at the report prepared by a jointly
appointed expert.] However, as Jacob observed, “[m]‌odern civil justice is concerned with expediency
and efficiency” (at 2). He further remarked that the “concern now is not the pursuit of absolute justice
but of fairness and efficiency …[which] reflects a dominance of real-​life commercial interests over less
definitive ideas of justice” [at 6]. This may give rise to tension or conflict with fundamental human
rights which seek to guarantee access to justice.
Some of the areas where there may be tension or conflict between procedural reform and human
rights protections include:
• limitations on expert evidence
• limitations on publicly funded legal services
• excessive court fees and charges
• limitations on the calling of witnesses
• limitations on the time allowed for hearings or the cross-​examination of witnesses
• limitations on proceedings in public
• compulsory referral to mediation or arbitration
• cases where hearings are not held within a reasonable time
• the nature of the assistance required to be given to self-​represented litigants
• restrictions on the right to a final hearing, including through provisions for striking out claims or
defences
• economic constraints on the right to a hearing, including security for costs
• paper-​based versus oral processes and hearings
• applications for an adjournment
• disclosure obligations and discovery
• exclusion of evidence
• requirements relating to “proportionality”
• judicial appointment, tenure and bias
• the funding of the civil justice system.
As one English judge has noted:
The tentacles of the Human Rights Act 1998 reach into some unexpected places. The
Commercial Court, even when exercising its supervisory role as regards arbitration, is not
immune [Mousaka v Golden Seagull Maritime [2002] 1 WLR 395].
The Human Rights Law Resource Centre submitted that the right to procedural fairness “ensures
litigants have the opportunity to present their case in conditions without substantial disadvantage
compared to the other party”. However, as noted in the context of European human rights
jurisprudence, States “enjoy a free choice of the means to be used in guaranteeing a litigant the
right to a fair trial” [Steel and Morris v UK, 68416/​01 [2005] ECHR 103, 60 (15 February 2005)].
60
[1.450]
Introduction to Civil Procedure
Chapter 1
Civil Justice Review – Human Rights Considerations cont.
The right to a fair trial, such as that contained in Article 6.1 of the European Convention on Human
Rights, is not absolute and “may be subject to restrictions, provided that these pursue a legitimate
aim and are proportionate” [Ashingdane v United Kingdom, judgment of 28 May 1985, Series
A no. 93, 24-​5, 57]. Similarly, the rights conferred by the Victorian Charter are qualified by the
provisions of the Charter itself.

THE NSW COURT SYSTEM: AN OVERVIEW
[1.460] The basic structure of the court system in New South Wales is hierarchical with a
Local Court, a District Court and a Supreme Court. There is also the Land and Environment
Court as well as a number of administrative tribunals.
Supreme Court of New South Wales
[1.470] The Supreme Court of New South Wales is the highest State court in New South
Wales (http://​www.supremecourt.justice.nsw.gov.au/​). The court operates under the Supreme
Court Act 1970 (NSW) and the Civil Procedure Act 2005 (NSW). The court has unlimited
civil jurisdiction and deals with the most serious criminal matters. It can hear all matters
that are not within the exclusive jurisdiction of the federal courts. The court is divided into
the Common Law Division and the Equity Division. The Common Law Division deals with
civil, criminal and administrative law matters. The Equity Division hears cases involving
commercial law, corporations law, equity, trusts, probate and matters pursuant to family
provisions legislation.
The Supreme Court also has two appellate divisions: the Court of Appeal and the Court
of Criminal Appeal. The Court of Appeal consists of judges appointed as appellate judges
who hear civil appeals. The Court of Appeal hears appeals arising from civil matters from
the Supreme Court, or a lower court. The appeal bench is usually three justices. In some
cases dealing with very important principles of law, a full bench of five judges will sit in the
Court of Appeal or Court of Criminal Appeal.
Land and Environment Court of New South Wales
[1.490] The Land and Environment Court of New South Wales’ jurisdiction is governed
by the Land and Environment Court Act 1979 (NSW) (http://​www.lec.justice.nsw.gov.au/​).
The court is vested with the power to determine environmental, development, building and
planning disputes. It has the same status as the Supreme Court of New South Wales.
District Court of New South Wales
[1.500] The District Court is the “intermediate court” in New South Wales (http://​www.
districtcourt.justice.nsw.gov.au/​). The District Court has jurisdiction in both civil and criminal
matters. The civil jurisdiction of the District Court has a jurisdictional limit of $750,000. The
court can deal with cases where larger amounts are involved if the parties to the case agree.
[1.500]
61
Civil Procedure in New South Wales
The District Court has an unlimited jurisdiction in claims for damages for personal injuries
arising out of a motor vehicle accident or a work injury.
Local Court of New South Wales
[1.510] The civil jurisdiction of the Local Court has two divisions: the Small Claims Division
and the General Division. The Small Claims Division deals with claims up to the amount of
$10,000, and the General Division deals with matters concerning a monetary value between
$10,000 and $100,000. However, note that the Local Court has a jurisdictional limit of $60,000
for personal injury or death claims (see Local Court Act 2007 (NSW) s 29). The Local Court
also has jurisdiction to hear criminal summary prosecutions, committal hearings, matters
concerning mental health issues, some family law matters, children’s criminal proceedings
(the Children’s Court), juvenile prosecutions and care matters, licensing issues and coronial
matters (Coronial Court); see http://​www.localcourt.justice.nsw.gov.au/​.
Industrial Relations Commission
[1.515] The Industrial Relations Commission of New South Wales was established under
the Industrial Relations Act 1996 (http://​www.irc.justice.nsw.gov.au/​). The Commission
conciliates and arbitrates industrial disputes, sets conditions of employment and fixes wages
and salaries by making industrial awards, approves enterprise agreements and decides claims
of unfair dismissal in New South Wales.
Workers’ Compensation Commission
[1.520] The Workers’ Compensation Commission determines disputes concerning workers’
compensation claims (with the exception of claims by coal miners) (http://​www.wcc.nsw.gov.
au). The Commission was established by the Workplace Injury Management and Workers
Compensation Act 1998 (NSW).
NSW Civil and Administrative Tribunal
[1.530] NSW Civil and Administrative Tribunal (NCAT) was established by the Civil and
Administrative Tribunal Act 2013. It is a super tribunal that has consolidated a total of 22
tribunals which include:
• the Consumer, Trader and Tenancy Tribunal;
• the Guardianship Tribunal;
• the Administrative Decisions Tribunal; and
• the Victims Compensation Tribunal.
Independent Commission against Corruption
[1.550] The Independent Commission against Corruption was created by the Independent
Commission Against Corruption Act 1988 (NSW) (http://​
www.icac.nsw.gov.au). The
Commission can investigate any matter involving public sector corruption in New South Wales.
Dust Diseases Tribunal
[1.560] The Dust Diseases Tribunal was established by the Dust Diseases Tribunal Act 1989
(NSW) and is a specialist court dealing with claims in tort for negligence relating to death or
62
[1.510]
Introduction to Civil Procedure
Chapter 1
personal injury resulting from exposure to asbestos and other dusts resulting in dust diseases
and other dust-​related conditions (http://​www.dustdiseasestribunal.justice.nsw.gov.au/​).
Mental Health Review Tribunal
[1.570] The Mental Health Review Tribunal is an independent body established by the
Mental Health Act 2007 (NSW) (http://​www.mhrt.nsw.gov.au).
FEDERAL COURT STRUCTURE
High Court of Australia
[1.610] The High Court of Australia was created in 1901 (http://​
www.hcourt.gov.au).
Section 71 of the Constitution provides that Commonwealth judicial power can only be
exercised by the High Court, a federal court created by the Commonwealth Parliament (such
as the Family Court) and State and Territory courts which are vested with jurisdiction pursuant
to Ch III of the Constitution. Chapter III provides the judicial power of the Commonwealth
to enforce its laws:
71 Judicial power and Courts
The judicial power of the Commonwealth shall be vested in a Federal Supreme Court, to
be called the High Court of Australia, and in such other federal courts as the Parliament
creates, and in such other courts as it invests with federal jurisdiction. The High Court shall
consist of a Chief Justice, and so many other Justices, not less than two, as the Parliament
prescribes.
The High Court has original jurisdiction pursuant to the Constitution. The jurisdiction of the
High Court is derived from ss 75 and 76 of the Constitution:
75 Original jurisdiction of High Court
In all matters:
(i) arising under any treaty;
(ii) affecting consuls or other representatives of other countries;
(iii) in which the Commonwealth, or a person suing or being sued on behalf of the
Commonwealth, is a party;
(iv) between States, or between residents of different States, or between a State and a resident
of another State;
(v) in which a writ of Mandamus or prohibition or an injunction is sought against an
officer of the Commonwealth;
the High Court shall have original jurisdiction.
76 Additional original jurisdiction
The Parliament may make laws conferring original jurisdiction on the High Court in any
matter:
(i) arising under this Constitution, or involving its interpretation;
(ii) arising under any laws made by the Parliament;
(iii) of Admiralty and maritime jurisdiction;
(iv) relating to the same subject-​matter claimed under the laws of different States.
77 Power to define jurisdiction
With respect to any of the matters mentioned in the last two sections the Parliament may
make laws:
[1.610]
63
Civil Procedure in New South Wales
(i) defining the jurisdiction of any federal court other than the High Court;
(ii) defining the extent to which the jurisdiction of any federal court shall be exclusive of
that which belongs to or is invested in the courts of the States;
(iii) investing any court of a State with federal jurisdiction.
Section 38 of the Judiciary Act 1903 (Cth) is an exercise of the power provided in s 77 of the
Constitution. Section 38 of the Judiciary Act 1903 (Cth) provides:
38 Matters in which jurisdiction of High Court exclusive
Subject to sections 39B and 44, the jurisdiction of the High Court shall be exclusive of the
jurisdiction of the several Courts of the States in the following matters:
(a) matters arising directly under any treaty;
(b) suits between States, or between persons suing or being sued on behalf of different
States, or between a State and a person suing or being sued on behalf of another State;
(c) suits by the Commonwealth, or any person suing on behalf of the Commonwealth,
against a State, or any person being sued on behalf of a State;
(d) suits by a State, or any person suing on behalf of a State, against the Commonwealth or
any person being sued on behalf of the Commonwealth;
(e) matters in which a writ of mandamus or prohibition is sought against an officer of
the Commonwealth or a federal court.
Under the Jurisdiction of Courts (Cross-​vesting) Act 1987, State Supreme Courts are, with
some exceptions and limitations, invested with the same civil jurisdiction as the Federal Court
has, including jurisdiction under section 39B of this Act.
The High Court has appellate jurisdiction conferred by s 73 of the Constitution. Section 73
provides that the High Court can hear and determine appeals from decisions of the High Court
itself (in its original jurisdiction), federal courts, other courts exercising federal jurisdiction
and State Supreme Courts:
73 Appellate jurisdiction of High Court
The High Court shall have jurisdiction, with such exceptions and subject to such regulations
as the Parliament prescribes, to hear and determine appeals from all judgments, decrees, orders,
and sentences:
(i) of any Justice or Justices exercising the original jurisdiction of the High Court;
(ii) of any other federal court, or court exercising federal jurisdiction; or of the Supreme
Court of any State, or of any other court of any State from which at the establishment
of the Commonwealth an appeal lies to the Queen in Council;
(iii) of the InterState Commission, but as to questions of law only;
and the judgment of the High Court in all such cases shall be final and conclusive.
But no exception or regulation prescribed by the Parliament shall prevent the High Court
from hearing and determining any appeal from the Supreme Court of a State in any matter in
which at the establishment of the Commonwealth an appeal lies from such Supreme Court to
the Queen in Council.
Until the Parliament otherwise provides, the conditions of and restrictions on appeals to the
Queen in Council from the Supreme Courts of the several States shall be applicable to appeals
from them to the High Court.
Section 34 of the Judiciary Act 1903 (Cth) applies to appeals from justices exercising the
original jurisdiction of the High Court. Sections 35 and 35AA provide that appeals shall not
be brought from a judgment, whether final or interlocutory, from a State or Territory Supreme
Court unless the High Court gives special leave to appeal.
64
[1.610]
Introduction to Civil Procedure
Chapter 1
Section 35A sets out the matters relevant to the court granting special leave to appeal:
35A Criteria for granting special leave to appeal
In considering whether to grant an application for special leave to appeal to the High Court
under this Act or under any other Act, the High Court may have regard to any matters that it
considers relevant but shall have regard to:
(a) whether the proceedings in which the judgment to which the application relates was
pronounced involve a question of law:
(i) that is of public importance, whether because of its general application or otherwise; or
(ii)
in respect of which a decision of the High Court, as the final appellate court, is
required to resolve differences of opinion between different courts, or within the one
court, as to the state of the law; and
(b) whether the interests of the administration of justice, either generally or in the particular
case, require consideration by the High Court of the judgment to which the application
relates.
Federal Court of Australia
[1.620] The Federal Court of Australia was created by the Federal Court of Australia Act
1976 (Cth) (http://​www.fedcourt.gov.au). The Federal Court of Australia has its jurisdiction
conferred by various federal statutes. The Federal Court’s jurisdiction covers civil matters
under federal law, including matters arising under the Constitution. The court deals with
disputes under federal Acts such as industrial disputes, corporations, trade practices, judicial
review and federal tax matters. The Federal Court has an appellate jurisdiction and sits as an
appeal court with three judges to hear appeals from decisions of single judges of the court,
decisions of the Supreme Court of Norfolk Island, decisions of the Federal Circuit Court
in non-​family law matters and certain decisions of the Supreme Courts of the States and
Territories exercising federal jurisdiction.
Family Court of Australia
[1.630] The Family Court of Australia has jurisdiction under the Family Law Act 1975 (Cth)
(http://​www.familycourt.gov.au).
Federal Circuit Court of Australia
[1.640] The Federal Circuit Court of Australia was formerly called the Federal Magistrates
Court which commenced operation in July 2000. It deals with a range of less complex
federal disputes previously heard in the Federal Court and the Family Court of Australia. The
jurisdiction of the Federal Circuit Court includes family law and child support, admiralty,
administrative law, bankruptcy, copyright, consumer protection law and trade practices,
privacy law, migration, unlawful discrimination and industrial law. It also has a Fair Work
Division (http://​www.federalcircuitcourt.gov.au/​).
[1.650] There are other federal tribunals and commissions such as the Australian Industrial
Relations Commission, the Fair Work Commission, the Fair Work Ombudsman, the National
Native Title Tribunal, the Australian Competition Tribunal, the Copyright Tribunal, the Defence
Force Discipline Appeal Tribunal, the Social Security Appeals Tribunal, the Migration Review
Tribunal, the Refugee Review Tribunal, the Administrative Appeals Tribunal, the Australian Human
Rights Commission and the Australian Competition and Consumer Commission. However as
previously stated, this book is primarily concerned with civil procedure in NSW courts.
[1.650]
65
CHAPTER 2
Case Management in New South Wales
[2.10]
[2.20]
[2.50]
[2.60]
[2.100]
[2.130]
[2.160]
[2.180]
[2.220]
INTRODUCTION...........................................................................................................
JUSTICE DELAYED IS JUSTICE DENIED............................................................................
[2.30]
Jackamara v Krakouer..........................................................................
BACKLOG REDUCTION.................................................................................................
[2.50]
Bi v Mourad......................................................................................
COSTS...........................................................................................................................
[2.80]
The Complexities of Case Management...................................................
CASELOAD MANAGEMENT AND MANAGERIAL JUDGING.............................................
[2.100]
Case Management in New South Wales...................................................
[2.110]
Managerial Judging.............................................................................
THE CIVIL PROCEDURE ACT 2005 AND THE UNIFORM CIVIL PROCEDURE RULES.........
[2.140]
Civil Procedure Act 2005 (NSW) ss 56–​60................................................
[2.150] Amendment of s 56......................................................................................
HOW HAS PT 6 OF THE CPA AFFECTED CIVIL PROCEDURE?..........................................
[2.160]
Metropolitan Petar v Mitreski................................................................
[2.170]
Tripple Take v Clark Rubber Franchising...................................................
DIRECTIONS..................................................................................................................
[2.190]
Civil Procedure Act 2005 (NSW) ss 61–​63................................................
[2.200]
Uniform Civil Procedure Rules 2005 (NSW) rr 2.1–​2.3................................
THE APPLICATION OF THE CPA AND UCPR...................................................................
[2.220]
Hans Pet Constructions v Cassar............................................................
[2.230]
Halpin v Lumley General Insurance.........................................................
[2.240]
McGuirk v University of New South Wales................................................
[2.250]
Aon Risk Services Australia v ANU...........................................................
[2.255]
[2.260]
[2.265]
[2.270]
[2.280]
[2.300]
[2.320]
67
68
69
69
69
69
70
75
75
77
78
79
81
82
82
82
83
84
86
87
87
95
99
99
Expense Reduction Analysts Group v Armstrong Strategic Management
and Marketing................................................................................. 102
Tugrul v Tarrants Financial Consultants................................................. 104
Reconciling the Goals of Minimising Cost and Delay with the Principle
of a Fair Trial in the Australian Civil Justice System.................................... 107
ETHICAL REQUIREMENTS............................................................................................
PRACTICE NOTES........................................................................................................
[2.290]
Practice Note SC CL 7........................................................................
ELECTRONIC CASE MANAGEMENT.............................................................................
ADMINISTRATION OF THE UNIFORM CIVIL PROCEDURE RULES..................................
[2.330]
Civil Procedure Act 2005 (NSW) ss 8, 9, 14–​16.......................................
111
112
113
114
117
117
INTRODUCTION
[2.10] This chapter discusses case management in the civil jurisdiction of the NSW court
system. Case management arose as a response to the twin evils of delay and excessive costs that
could arise from leaving the control of litigation in the hands of the parties without judicial
supervision. All NSW civil courts are now controlled by the same set of court management
rules. The Civil Procedure Act 2005 (NSW) (CPA) and the Uniform Civil Procedure Rules
2005 (NSW) (UCPR) commenced operation in August 2005. The CPA and the UCPR make
very clear that the traditional version of the adversary system, where the court had virtually no
part to play until the parties indicated that the case was prepared and ready for trial, no longer
applies to civil litigation in New South Wales. In Aon Risk Services Australia Ltd v Australian
[2.10]
67
Civil Procedure in New South Wales
National University (2009) 239 CLR 175 at [113], the High Court stated, “In the past it has
been left largely to the parties to prepare for trial and to seek the court’s assistance as required.
Those times are long gone”.
This chapter discusses the concerns of delay and excessive cost, development of case
management in New South Wales and the overriding purpose principles contained in the CPA
and the UCPR. Recent cases are explored to provide an insight into the pervasive effect that
the overriding purpose principles have on all aspects of civil litigation. The chapter discusses
the use of rules of court and practice directions as mechanisms designed to implement case
management and highlights the advent of electronic case management.
JUSTICE DELAYED IS JUSTICE DENIED
[2.20] Prior to the introduction of case management, many cases were allowed to take a long
time before they were ready for hearing. In 2001, former Chief Justice Spigelman said:
There are at the moment almost two thousand trial cases in the Court –​1600 in the Common
Law Division and about 300 in the Equity Division –​which are over two years old and which
are not ready for hearing. There are, of course, circumstances in which a delay of more than
two years in preparing a case for trial can be justified. However, the overwhelming majority
of these two thousand or so cases are not of that character. Obviously, if all of these cases
suddenly became ready for hearing in the short term, then something like a holding list would
re-​emerge. I do not regard this as a serious threat.1
His Honour was alluding to a legal culture that had developed in New South Wales. This legal
culture accepted and had adapted to the fact that it took years to get a case on for trial in NSW
civil courts. Delay had become a cultural norm and that had to be changed.
From the 1980s, judicial minds were being turned to ways of reducing delay and cost.
Case management procedures were instituted in the Commercial Division of the NSW
Supreme Court in 1986.2 These became the driving force of changes to civil practice and
procedure in New South Wales for individual case management and, to a lesser extent,
caseload management.
Throughout the common law world, over recent decades, the judiciary has accepted a
considerably expanded role in the management of the administration of justice, both with
respect to the overall caseload of the court and in the management of individual proceedings.
For example, in the United Kingdom, dramatic reforms to civil procedure were introduced
by the Civil Procedure Rules (1998) as a result of Lord Woolf’s report Access to Justice: Final
Report to the Lord Chancellor on the Civil Justice System in England and Wales (1995).3
Judges now intervene in proceedings to a degree which was unheard of only two decades
or so ago. Courts are no longer passive recipients of a caseload over which they exercise no
control.
1
2
3
68
Address by the Honourable JJ Spigelman AC, Chief Justice of New South Wales, opening of the Law
Term Dinner New South Wales Law Society Parliament House, Sydney, 29 January 2001 http://​www.
supremecourt.justice.nsw.gov.au/​Documents/​Publications/​Speeches/​Pre-​2015%20Speeches/​Spigelman/​
spigelman_​speeches_​2001.pdf.
See A & N Holding NSW Pty Ltd v Andell Pty Ltd [2006] NSWSC 55 at [24] per Bergin J and Rogers A, “The
Managerial or Interventionist Judge” (1993) 3 Journal of Judicial Administration 96.
See Dwyer D, “Introduction” in Dwyer D (ed), The Civil Procedure Rules Ten Years On (Oxford University
Press, 2009) p 5.
[2.20]
Case Management in New South Wales
Chapter 2
Jackamara v Krakouer
[2.30] Jackamara v Krakouer (1998) 195 CLR 516 at 526–​527
GUMMOW and HAYNE JJ
Delays in the courts are a major cause of disquiet not only among those who resort to the courts
but also among judges and all others associated with the courts. Delay will almost always impede the
proper disposition of any case that does not come to trial promptly. Memories fade; records may be
lost. The impediments are many, varied and obvious. Those impediments may be overcome but their
presence is an added burden for both the litigants and the court that must try the case. Delay in a case
will almost always add to the costs. The case takes longer to prepare and to try because the events
are no longer fresh in the minds of those who will give evidence. Costs, therefore, increase. Delay in a
case also adds to the overall burden on the judicial system. The case that has been delayed in coming
to trial and therefore takes a day longer to try than otherwise would be needed, keeps another case
out of the lists for that day. … Each day’s delay in bringing a case to trial and final judgment simply
prolongs the uncertainty and worry felt by the litigants. No doubt there are other reasons for the
disquiet felt by both litigants and lawyers about delay but the matters we have mentioned indicate
why it is so important to avoid delays wherever possible.

BACKLOG REDUCTION
Bi v Mourad
[2.50] Bi v Mourad [2010] NSWCA 17
ALLSOP P
[47] Delay is a feature of litigation intended to be eliminated as far as possible by the statutory
enactment of the regime in the Civil Procedure Act. It cannot always be done. This purpose is not
through some parliamentary authoritarian or over-​prescriptive view of how people should lead their
lives; rather, it is through the keen recognition of the conduct of the courts, in particular in the 20th
century, of the need to deal with cases expeditiously if they are to be dealt with justly. Delay and case
backlog are not merely factors affecting the costs of delivering justice; they corrode the ability of the
courts to provide individual justice. The reforms that have taken place under the Civil Procedure Act
and the evident attempt by courts to ensure efficiency can be seen not merely to reflect worthy efforts
for efficiency but also to be steps vital for the provision of timely individual justice.

COSTS
[2.60] Cost is of concern to the civil justice system because excessive costs may hamper access
to justice because disputants cannot afford to commence litigation. The cost of litigation may
also be employed as a tactical weapon to force a party with fewer resources to discontinue
their proceedings or accept a settlement below what they may have been able to achieve
through a court determination, or at least the threat of a court determination. A large part
of the litigant’s costs are the lawyer’s revenue. The link between lawyer remuneration and
the amount they can charge for their services may create an incentive to bill more hours
[2.60]
69
Civil Procedure in New South Wales
(where the lawyer charges by the hour) which in turn may create an incentive to extend and
complicate litigation. Costs can also be incurred due to disbursements such as court fees,
expert reports, witness expenses and printing fees. Additionally, there may be less tangible
(and largely unrecoverable costs) in the form of lost time and diverted resources. In its 2014
report on access to justice, the Productivity Commission estimated that the average cost of
litigation in New South Wales was somewhere in the range of approximately $60,000 to
$90,000.4 The Productivity Commission also reported that in the District and Supreme Courts
of New South Wales, compared to cases that settled pre-​trial, legal costs nearly doubled for
cases that settled on or during trial and more than doubled for cases that went to verdict.5
Case management is one tool by which attempts to minimise cost may be sought. However,
case management may also generate or front-​load costs as it requires parties to take additional
or more comprehensive steps than what they may choose to undertake themselves.
The Complexities of Case Management
Judicial Case Management and the Problem of Costs
[2.80] The Honourable James Allsop AO, Chief Justice of the Federal Court, Judicial Case Management
and the Problem of Costs [Extract from the Lord Dyson Lecture on “The Jackson Reforms to Civil Justice
in the UK,” 9 September 2014, (2015) 39 Australian Bar Review 228]6
Case management as a solution to the costs problem
In the so-​called bad old days, litigation was left entirely to the parties, with the court taking no
interest in its progress unless an issue was put before it by the litigants. It was the perceived (and real)
inadequacies of this rigidly adversarial system, with its aloof judges, that led to the Woolf reforms
of procedure in England and Wales. Lord Woolf put the interrelated problems of cost, delay and
complexity squarely at the feet of judges and the role they played in the litigation process:
These three [problems] are interrelated and stem from the uncontrolled nature of the
litigation process. In particular, there is no clear judicial responsibility for managing individual
cases or for the overall administration of the civil courts.[10]
This is no mere truism or platitude. One may conceive of many reasons for the cost, delay and
complexity of civil litigation. The intricacy of substantive laws, the conduct of the legal profession
and the conduct of the courts are three distinct possible reasons. Yet Lord Woolf nominated the lack
of judicial case management as the overriding concern. Without effective judicial control, he wrote,
the adversarial process is likely to encourage an adversarial culture and to degenerate into an
environment in which the litigation process is too often seen as a battlefield where no rules
apply. In this environment, questions of expense, delay, compromise and fairness may have
only low priority. The consequence is that expense is often excessive, disproportionate and
unpredictable; and delay is frequently unreasonable.[11]
…
The result of such diagnoses is case management. What do we mean by this? It emerged under
the label of caseflow management in the United States in the early 1970s. An early proponent was
Maureen Solomon. … She described caseflow management as follows:
[A]‌s now generally accepted in the courts community, caseflow management connotes
supervision or management of the time and events involved in the movement of a case
4
5
6
70
Productivity Commission, Access to Justice Arrangements (Inquiry Report, 5 September 2014) 119.
Productivity Commission, Access to Justice Arrangements (Inquiry Report, 5 September 2014) 120.
Most footnotes omitted.
[2.80]
Case Management in New South Wales
Chapter 2
The Complexities of Case Management cont.
through the court system from the point of initiation to disposition, regardless of the type
of disposition.[17]
Where the principles of caseflow management hold sway, law ceases to be impassive and distant.
Sword and scales are put to one side and practitioners are engaged by the court.
…
More generally, there are two broad ways in which case management is thought to put downward
pressure on litigation costs. First, by ensuring that cases continue to progress in a timely fashion, the
efficiency of their preparation should increase. Less time should be spent by lawyers and advocates
refreshing their memory of any given matter after an unnecessary delay, while the necessity to adhere
to a timetable should focus practitioners mind on the essential issues. Second, the length of litigation
is supposed to be decreased by the encouragement of earlier and more frequent settlements, which
in turn bring down litigants expenses.
…
Perils of case management
The picture that emerges from these studies [to which Justice Allsop had referred in the full speech]
is, at best, blurry. It seems tolerably clear, however, that judicial case management, if it is done badly,
will either have no impact on litigation costs or, worse, increase them. In light of this, I propose to
make some remarks about the perils of case management that must be borne in mind whenever it is
proposed to deploy it as a means to reduce costs.
Front-​loading and unnecessary running-​up of costs
As observed in the American and English studies to which I have alluded, case management has the
potential to cause parties to bear costs that might not otherwise have been incurred. It may happen
in at least two ways. First, costs may be front-​loaded, with the result that parties who would in any
event have settled their disputes are nonetheless forced to pay significant amounts for work done by
lawyers in complying with case management requirements. This was a point made by the Hon James
Spigelman, then Chief Justice of NSW, in an address in 2004:
I recognise that some of the case management practices that the courts have adopted, in
order to reduce delays, may have resulted in increased costs. In particular, they have resulted
in the front loading of costs by bringing forward expenditure that may not occur if a case
settles, as most do. Some aspects of court practice may show insufficient regard for the costs
that are imposed on others.[59]
The authors of the 2002 report on the Federal Courts docket system put a related point as follows:
[I]‌t may be advantageous to let some cases stay dormant if that would assist the parties in
reaching a resolution out of court, in which case it would be inappropriate for the court to
attempt to hurry the matter through the court.[60]
One must be careful not to overstate the point, however. Effective judicial case management,
by clarifying and stripping the issues early, may greatly hasten any settlement that would in any
event have occurred. Settlement negotiations may thereby be truncated. That, in turn, would exert
downward pressure on expenses. Furthermore, parties who are destined to settle are nevertheless, as
we all know, perfectly capable of running up litigation costs, whether or not judges become involved
in case management.
The second way in which judicial case management has the potential to drive up expenses is
simply by being excessive. This is a danger irrespective of the propensity of most litigants to settle
out of court. A case that ultimately goes to trial may be made even more expensive by judicial
over-​
management. A requirement that practitioners attend multiple directions hearings may be
counterproductive if any cost savings ultimately resulting from the matter being better prepared for
trial have already been wiped out by the need to pour funds into the directions hearings themselves.
[2.80]
71
Civil Procedure in New South Wales
The Complexities of Case Management cont.
…
There is a particularly bitter irony where case management undertaken specifically to curb costs in
fact adds to them. It has been suggested that the requirement to file costs budgets and attend cost
management conferences under the Jackson reforms in the UK actually increases the length and cost
of litigation. One is presented with the macabre spectacle of lawyers running up costs negotiating,
preparing and filing costs budgets, and then running up more costs arguing about those budgets
before a judge.
On the other hand, one ought to acknowledge the salutary educational potential of the interaction
between judge and profession that occurs in the process of case management. If it is done properly,
judicial management of a case may inculcate habits and practices that are carried over into the
practitioners next matter. A few careful words uttered in one directions hearing may forestall the
need for such a hearing in a later case. I will forever recall Justice Andrew Rogers saying in his court
in his gently modulated English: Not in my Court you won’t. It is possible, therefore, that judicial
case management in one case will have an impact on costs not only in that proceeding but also in
others down the track. Of course, it is also true that one should be slow to force unnecessary expense
upon litigants in one matter for the sake of educating the profession and thereby ensuring that those
expenses are not later incurred by litigants in other cases. Using people as means to ends always raises
difficult moral questions.
…
The attitude of judges
Judges also bear some responsibility for avoiding the pitfalls of an excessively inflexible approach to
case management. The risk is that judges given a large amount of leeway to control cases before them
will simply develop their own cookie-​cutter procedures. In this connection, history is important (as it
always is). The common law developed as a liberal institution that accords parties the freedom to run
their cases as they see fit. Inquisitorial justice is a civilian concept upon which Englishmen and their
progeny in the common law world have traditionally looked askance. To a degree party autonomy is
a virtue. It is one of the attractions of arbitration.
Managerial judging, therefore, is at odds with the habits of mind in which common law judges
have traditionally been steeped. One Australian Federal Court judge expressed this view as follows:
I think its a most naÏve notion of all to suggest to the Court that judges should be managerialist
judges, taking cases by the throat, and forcing them to a quick judgment, despite what the
parties say, despite what the lawyers say.[71]
In the rise of judicial case management, we are witnessing no less than a shift in common law philosophy.
In some judges, resistance to it may take the form of a rule-​based, inflexible approach to the task of
case management, infecting the new system with the ethos of the old. As one judge has observed,
I suppose the success of the system so much depends on the approach and enthusiasm of
the judges who are administering it. If you just treat it as a formal standardised process, oh
well we’ve got to go through it, I don’t think you are going to find any change between this
system and the old. But if you try and implement the underlying philosophy of it, I think
there is a chance of change.[73]
In other words, if a judges attitude to case management is that it is an onerous administrative burden
that he or she should not be required to undertake, then the results may be counterproductive. It will
be tempting for such a judge to apply standardised case management to any given matter, without
being attentive to its particular characteristics. In such instances, it is likely that case management will
inflate costs with no offsetting benefits. It will become process, separate from the resolution of the
dispute: a necessary hurdle to be jumped before the real task begins.
…
72
[2.80]
Case Management in New South Wales
Chapter 2
The Complexities of Case Management cont.
The responsibility of practitioners
Now that we have reached the subject of focusing practitioners minds, allow me to step back for a
moment. As I have observed, the argument for greater judicial intervention in the litigation process
typically begins with a jeremiad on the perils of an adversarial culture that gives free rein to the
practitioners. Somehow, though, one arrives at the conclusion that those who need to change their
behaviour are not practitioners so much as judges. Alfred Hitchcock is rumoured to have said film
actors were like cattle, and should be treated accordingly. A not dissimilar opinion of legal practitioners
appears to be the unarticulated premise in any argument that since lawyers run up unnecessary
costs for their clients, judges need to do their job differently. Implicit in the zealous call for judicial
case management, in other words, is the notion that solicitors and barristers lack control over their
own behaviour or are otherwise irredeemably refractory. Yet unlike, perhaps, screen actors, legal
practitioners are not Brown’s cows, responsive only to the sting of the prod. They are professionals.
And they are paid accordingly. Surely, as a profession, they must bear some responsibility for the way
in which matters are litigated.
The duty of lawyers to promote the just, timely and cost-​effective resolution of court proceedings
has been given legislative imprimatur in several jurisdictions, including the Federal Court.[78] The
penalty for dereliction of this duty may be a personal costs order. …
Let me turn to the profession. Let me posit two methods or styles of practice. Perhaps there are
more; perhaps neither exists; but humour me by allowing me to posit the dichotomy. I will let you
judge for yourselves whether they exist. A little plain speaking is required. The distinction between
them lies in divergent responses to the stimulus of a client’s instructions in relation to a dispute. In
type A practice, the client’s problem is examined and a way is sought to arrive at the best possible
result for the client at the lowest possible cost. In some cases, this may entail the sacrifice of fees that
might have been earned (if that verb may sensibly be deployed in this context), had a less efficient
approach been adopted. If a fight is necessary, it is had; but only on the real issues worthy of the
trouble and cost of the fight.
In type B practice, when faced with the client’s instructions, the response is to think of the fees that
might foreseeably be derived by dealing with the dispute, without an eye to any parsimony of issues
or costs. Disputes are treated as an instrument of fee generation.
Like the litigants described by Gibbon, clients of the second species may well come out at the other
end of litigation with patience and fortune almost exhausted. When next they have a problem, they
do not return to the lawyer who has denied them true value for money.
I accept that this may be a crude and inadequate paradigm. But, is it truly to be said that type B is
not a problem? Is not the risk of it present when the practice of law is viewed as a fee earning business,
the profits of which are maximised by fee delivery?
One danger of excessive judicial case management is that it provides comfort to the second species
of practice by fostering passivity in the profession as a whole. It risks encouraging over-​reliance upon
the court to dictate to parties how their litigation will run. That makes it all too easy for lawyers
to abdicate their statutorily mandated responsibility to resolve disputes in a cost-​effective manner
for their clients. Initiative and responsibility are shifted to judges. Also, it may provide detailed and
unnecessary process around which much work must be done. Litigation practitioners are reduced to
fee-​collection machines.
Such a development would have a profoundly deleterious impact upon the administration of justice.
If costs cannot be controlled, the client comes to the view that law itself is useless and irrelevant: a
deeply dangerous outcome. Judges and practitioners must strive to prevent this happening.
How can it be avoided? One way of avoiding it, perhaps, is by thinking about court rules, procedures,
trial processes and all aspects of litigation by reference to the dichotomy that I have posited. Will the
procedure permit exploitation, whether conscious or unconscious, driven by process-​based activity? If
so, how can a substitute procedure be put in place that will achieve the valid end in question, without
feeding process-​driven costs.
[2.80]
73
Civil Procedure in New South Wales
The Complexities of Case Management cont.
If process-​driven costs can be reduced to a bare minimum, fees for true skill and acumen will not
seem so painful. The role of but say may re-​emerge.
Clients truly despise a system of 6 minute units (at say $50-​$75) for 60 second tasks; not only
because the task took 60 seconds, but also because it was brain-​less in its character. If you think clients
do not sometimes feel like this, I think you need to get out more. Clients should not have to pay like
this for process, and they should not do so. What they should be prepared to pay for, and what they
do not begrudge, is paying for real skill and experience. …
A number of fundamental propositions need to be grasped and applied on a daily basis:
1.
The profession is primarily responsible for the skilful conduct of cases.
2.
The lawyer is a fiduciary to be held to the highest punctilio of an honour. If there is a choice to
undertake a cheaper more efficient way to operate, the fiduciary duty is engaged.
3.
Courts should organise their structures to facilitate efficient and skilled lawyers, and to impede
or prevent process-​based costs that are unnecessary.
4.
Disputes in society are inevitable. It is a social and constitutional imperative to make reasonably
available the process of court adjudication.
5.
The basal considerations are trust, skill and service in, and of, the profession, and the judiciary.
It is unlikely that any one structure or one step, alone, will achieve and maintain a workable legal
system of which we are all proud. But the recognition of what we do, and who we are, will go some
way towards that: We are not in a business or an industry; we are a profession, that is founded on
duty (fiduciary duty) that, as Cardozo CJ said in 1928, is not governed by the morals of the market
place (by which he meant honesty and reasonable good faith) but by the punctilio of an honour the
most sensitive. The courts are entitled to expect and demand no less from the profession and should
organise their structures accordingly. The failure to recognise the strictness of the fiduciary duty may
well have been at the base of many of the troubles of the financial sector in the last 20 years. It should
never be allowed to undermine the practice of the law.
The court’s task is to understand how litigation should run, and how it can be encouraged to run
cost-​efficiently. I suggest a new dialogue based on these fundamentals. How case management works
or not, as the case may be, should be part of that dialogue.
[10] Lord Woolf MR, Access to Justice: Interim Report, ch 3 at [1]‌(available at <http://​webarchive.
nationalarchives.gov.uk/​+/​http://​www.dca.gov.uk/​civil/​interim/​chap3.htm>).
[11] Lord Woolf MR, Access to Justice: Interim Report, ch 3 at [4]‌(available at <http://​webarchive.
nationalarchives.gov.uk/​+/​http://​www.dca.gov.uk/​civil/​interim/​chap3.htm>).
[17] M Solomon and D Somerlot, Caseflow Management in the Trial Court: Now and for the
Future (American Bar Association, 1987) 3.
[59] James Spigelman, Opening of Law Term Dinner, 2004 (Address at the Law Society of NSW,
Sydney, 2 February 2004) (available at <http://​www.supremecourt.lawlink.nsw.gov.au/​agdbasev7wr/​
supremecourt/​documents/​pdf/​spigelman_​speeches_​2004.pdf>).
[60] C Sage, T Wright and C Morris, Case Management Reform: A Study of the Federal Courts
Individual Docket System (Law and Justice Foundation of New South Wales, June 2002) 80.
[71] C Sage, T Wright and C Morris, Case Management Reform: A Study of the Federal Courts
Individual Docket System (Law and Justice Foundation of New South Wales, June 2002) 79.
[73] C Sage, T Wright and C Morris, Case Management Reform: A Study of the Federal Courts
Individual Docket System (Law and Justice Foundation of New South Wales, June 2002) 45.
[78] Federal Court of Australia Act 1976 (Cth), ss 37M, 37N, 43(3)(f); Family Law Rules 2004 (Cth), rr
1.07, 1.08, 19.10; Civil Procedure Act 2005 (NSW), s 56; Civil Procedure Act 2010 (Vic), ss 7, 28.

74
[2.80]
Case Management in New South Wales
Chapter 2
CASELOAD MANAGEMENT AND MANAGERIAL JUDGING
Case Management in New South Wales
[2.100] The Honourable JJ SpigelmanAC, Chief Justice of New South Wales, Case Management in
New South Wales [Extract from a paper presented for the Judicial Delegation from India, Sydney, 21
September 2009, http://​www.lawlink.nsw.gov.au]
New South Wales Practice
New South Wales practice with respect to civil case management has been a story of gradual
development over a long period of time. There has never been a dramatic rearrangement of practice
and procedure of the character that followed Lord Woolf’s Access to Justice report in the United
Kingdom. In New South Wales what happened was that a particular kind of practice developed in one
specific area and was adopted in other areas.
The principal driving force for case management –​particularly caseload management –​was the
acceptance that delays in the system were too great. Justice delayed, as is often said, is justice denied.
Of course, not all lapse of time can be called “delay”. In New South Wales we have now adopted, by
statute, a formal objective of expedition which contains a definition of delay as the time beyond that
which is reasonably required for the fair and just determination of the case.
The New South Wales Courts do not have what the Americans call a “docket system” under which
cases are assigned to the judge who will conduct the trial for management. Other courts in Australia
[such as the Federal Court of Australia] use a docket system. There are arguments for and against the
two approaches and what is right for one court is not right for another. In my opinion, if New South
Wales were to adopt a docket system the productivity of our courts would significantly decline.
Not all judges are as capable, or as willing, to manage a list as one would wish. In our system, case
management is done by judges with an interest in, and an aptitude for, organisation. Judicial time is
wasted if the gaps caused by settlements and adjournments are not filled quickly.
Effective and efficient use of resources, in our experience, requires something more than managing
individual cases for trial. It requires an overview which, in our experience, is best done by disaggregating
the caseload into distinct categories which require different treatment based, to a significant degree,
on specialised law and [specialisation] amongst legal practitioners. Most case management systems
involve some system of differentiation, often called “tracks”. The New South Wales system involves
a greater number of categories or “tracks”, but it works in our system because of our particular
caseload. Each jurisdiction will differ in this respect.
The Act and Rules
The starting point for our caseload management and case management systems is comprehensive
legislation and rules which enable the court to effectively manage its caseload. The rules have been
progressively developed over the course of some two decades.
The relevant statutes and court rules have been consolidated and applied uniformly to all three New
South Wales courts by the Civil Procedure Act 2005 (NSW) and Uniform Civil Procedure Rules 2005. After
a process of collaboration amongst the three courts, under judicial leadership with considerable input
from departmental officers, we have adopted a uniform Act and uniform set of Rules of Civil Procedure
applicable to all courts. These Rules are sufficiently flexible to allow for the differing requirements at
the three levels of the hierarchy. The Act and Rules integrated existing practice. This did not involve
significant change to past practice. The key reform was in the uniformity. This achievement would
have been delayed if significant changes had been proposed.
The Rules are backed up by detailed Practice Notes with respect to the conduct of proceedings,
particularly the conduct of proceedings in specialist lists. Although the basic rules are uniform, at the
three levels of the court hierarchy practices differ, so that matters are treated with greater expedition
in the Local Court than in the District Court and in the District Court than in the Supreme Court. Cases
[2.100]
75
Civil Procedure in New South Wales
Case Management in New South Wales cont.
of greater legal or factual complexity are distributed upwards in the hierarchy of courts, with a view
to ensuring that those which do not justify elaborate procedures are dealt with in a less elaborate way
and vice versa. Obviously there remains considerable overlap and drawing a clear line is not always
possible. …
The Civil Procedure Act 2005 and the Uniform Civil Procedure Rules confirm and re-​enact the powers
of courts to confine a case to issues genuinely in dispute and to ensure compliance with court orders,
directions, rules and practices. When exercising any power a court is required to give effect to the
overriding purpose expressed in the Act, namely: to facilitate the “just, quick and cheap” resolution
of the real issues in the proceedings.
Under our Civil Procedure Act, parties have a statutory duty to assist the court to further this
overriding purpose and, therefore, to participate in the court’s processes and to comply with directions
and orders. Furthermore, every legal practitioner has a statutory duty not to conduct himself so as to
cause his or her client to breach the client’s duty to assist.
The Act and Uniform Rules, which distil in a coherent manner the principles that have been
developed over many years of practical operation of the previous legislation and court Rules, identify
the objects of case management as follows:
• The just determination of proceedings.
• The efficient disposal of the business of the court.
• The efficient use of available judicial and administrative resources.
• The timely disposal of the proceedings, and all other proceedings in the court, at a cost affordable
by the parties.
The Act also requires the practice and procedure of the court to be implemented with the object of
eliminating unnecessary delay, as defined. Furthermore, court practices and procedures are required
by the Act to be implemented with the object of resolving issues, so that the cost to the parties is
proportionate to the importance and complexity of the subject matter in dispute. In order to serve the
overriding purpose, and to meet the other objectives specified, the courts are given a comprehensive
range of powers including:
• Power to direct parties to take specified steps and to comply with timetables and otherwise to
conduct proceedings as directed, with respect to discovery, admissions, inspection of documents
or property, pleadings, particulars, cross-​claims, affidavits or statements, time place and mode of
hearing.
• Powers with respect to the conduct of the hearing, including limiting the time that may be taken
in cross-​examination, limiting the number of witnesses, limiting the number of documents that
may be tendered, limiting the time that may be taken by a party in presenting its case or in making
submissions.
• The exercise of such powers may identify certain matters required to be taken into account
including the subject matter, complexity or simplicity of the case, the costs of the proceedings
compared with the quantum of the subject matter in dispute and the efficient administration of
court lists.
• Powers have also been conferred to direct a solicitor or barrister for a party to provide to his or
her client a memorandum stating the estimated length of the trial and estimated costs of legal
representation, including costs payable to the other party if the client was unsuccessful.
• Powers have also been conferred to order costs to be paid by a legal practitioner, where costs have
been incurred by reason of some serious neglect in competence or impropriety.
In Australia, the second largest cost after legal fees is expert evidence. The rules make special provision
for such evidence in an endeavour to control those costs and to regulate the delay caused by
unnecessary disputation on such matters. [Expert evidence is discussed in Chapter 13.]
76
[2.100]
Case Management in New South Wales
Chapter 2
Case Management in New South Wales cont.
The courts encourage the use of alternative dispute resolution to resolve a dispute as early as
possible and make detailed provision for mediation and arbitration. [Alternative dispute resolution is
discussed in Chapters 4 and 5.]
Court Organisation of Management
Different techniques are adopted for case management in different courts in New South Wales. The
District Court, a high volume civil jurisdiction, significantly focused on matters involving personal injury,
requires litigants not to commence an action unless they are ready to proceed with it, save in the case of
a time limitation problem. Thereafter the court insists on strict compliance with a timetable lodged at the
outset of proceedings, with a view to listing a matter for hearing within 12 months of its commencement.
In the Supreme Court, cases are of a higher level of complexity and are managed in a number of
different ways. Each of the divisions of the court, namely the Court of Appeal, the Court of Criminal
Appeal, the Common Law Division and the Equity Division have their own registrars responsible to
judges for case management.
Building on our long experience with the success of our Commercial List, cases of similar character
are grouped by subject category and specialised Practice Notes set out in detail the requirements of the
particular field. Each of these lists is managed by a judge, in conjunction with a registrar. The specialist
lists in the Common Law Division are the Administrative Law List, the Criminal List, the Defamation
List, the General Case Management List, the Possession List and the Professional Negligence List. In the
Equity Division the specialist lists are the Admiralty List, Adoption List, Commercial List, Corporations
List, Probate List, Protective List and Technology and Construction List.
The conduct of each of these lists is substantially assisted by the existence of user groups which are
formed for consultation between the judges who administer the particular list and representatives of
the profession who [practise] in the fields. The process of refinement of the Rules and Practice Notes
is a continuing one, in which these user group consultations play a significant role.
A key objective of our case management is to ensure trial date certainty, so that litigants and their
representatives know that if a trial matter is listed for trial it will be heard. Some over-​listing is done
in anticipation of settlements, and there are unfortunate occasions when matters have not been
able to get on. We regard it as critical, however, that that does not become a regular event, so that
practitioners refuse to settle on the basis that there is a real possibility that a trial date will be vacated.
The most important aspect of the ongoing management system is that it is conducted under judicial
leadership with appropriate delegation to registrars. All cases are brought under court control at an
early stage with an early return date. Most lists are managed by registrars who sit daily. Some specialist
lists are managed primarily by judges who sit less frequently, generally weekly. Interlocutory matters
requiring orders, rather than directions, are referred to judges, either those in charge of specialist lists
or to the duty judge in each of the two Divisions of the court.

Managerial Judging
[2.110] Caseflow management focuses on the overall caseload and seeks to distribute and direct
cases through the system in an efficient manner. Managerial judging focuses on the role of the judge
in an individual case. The judge tailors the procedures to be employed to the needs of the individual
case. Managerial judging requires the judge to take an active part in directing the proceedings
through its interlocutory stages. As a result, the judge takes control of the case and through various
directions and timetables specifies the steps to be taken and the time by which those steps must
have occurred. In NSW, the role of managerial judge may be performed by registrars or list judges
depending on the particular list.
[2.110]
77
Civil Procedure in New South Wales
Managerial Judging cont.
More generally, Justice French, as he then was, has observed:7
No system of judicial decision-​making is proof against the problems of cost and delay. The
resolution of legal disputes is inescapably labour intensive. It requires careful consideration,
by whatever means, of evidence, findings of fact and the application of the law, be it written
or unwritten, to the facts as found. In recent years, however, in Australia and other countries
increasingly well-​educated and assertive consumers of judicial services have made greater
demands on government and its institutions, including the judiciary, to be responsive to
their needs in terms of the costs and efficiency. In Australia there has been a wide range of
reactions to such concerns which have been reflected in the movement to increased judicial
supervision of litigation and also the development of non-​judicial dispute resolution options.
In a comparative analysis of the adversarial and civil code systems, A Zuckerman observed:
Both Commonwealth countries and civil law countries display a shift towards the
imposition of a stronger control by judges over the progress of civil litigation. In virtually
all the systems reviewed here there is a perception that, when the process of litigation is
left to the parties and their lawyers, its progress is impeded by narrow self-​interest. Such
self-​interest may be that of recalcitrant defendants bent on exhausting and tormenting their
plaintiffs or that of self-​interest of lawyers determined to enhance their own incomes.
The contemporary dominant view is that the disruptive self-​interest of parties and their
lawyers can only be kept at bay by an active judiciary that directs the litigation process and
is able to prevent disruptive tactics. The USA has been leading the trend amongst common
law countries. A culture of managerial judges is now well established there. In England and
Australia the move towards judicial control is more recent but is equally dramatic.
A similar trend is reported from the great majority of civil law countries. In France, Spain,
Portugal, Italy and even in Japan and in Germany, moves are afoot to strengthen the judicial
supervision of the litigation process.

THE CIVIL PROCEDURE ACT 2005 AND THE UNIFORM CIVIL
PROCEDURE RULES
[2.130] By 2000, Pt 1 r 1(1) of the Supreme Court Rules 1970 (NSW) had been modified to
expound the overall objective of practices and procedures in the NSW Supreme Court. The
overriding purpose of the Rules was to facilitate the just, quick and cheap resolution of the
real issues in civil proceedings. The Rule obliged the court to actively manage cases to achieve
this overriding objective. However, these rules only affected the practice of the Supreme Court
of New South Wales.
In early 2003, the Uniform Civil Procedure project commenced. A working party was
established and chaired by Hamilton J of the Supreme Court of New South Wales. The working
party consisted of representatives of the District Court, the Local Court, the Bar Association,
the Law Society of New South Wales and the Attorney-​General’s Department. The guiding
philosophy for the work of the working party was to deliver a common set of rules simplified
where possible, but without radical changes in substance or form, across the various levels of
jurisdiction within the NSW judicial system.
7
78
French RS, The Role of the Trial Court Judge in Pre-​trial Management (2004).
[2.130]
Case Management in New South Wales
Chapter 2
The CPA and the UCPR consolidated the existing provisions about civil procedure into a
single Act and a set of rules that apply uniformly to all three NSW courts. For the first time
a synchronisation of civil rules and civil forms between the three main jurisdictions existed.
The CPA contains some provisions moved from the Supreme Court Act 1970 (NSW), the
District Court Act 1973 (NSW) and the Local Courts (Civil Claims) Act 1970 (NSW). The
UCPR needed to be sufficiently flexible to allow for the differing requirements of the three
levels of the court hierarchy. For example, simple debt claims in the Local Court should not be
subject to the same requirements as complex proceedings in the Supreme Court.
Confining a case to the issues genuinely in dispute and ensuring compliance with court
orders, directions, rules and practices are court powers that the CPA and the UCPR re-​enact
and confirm. It should be noted that s 56(3) of the CPA provides that parties have a statutory
duty to assist the court to further this overriding purpose and, accordingly, to participate in
the processes of the court and to comply with directions and orders.
A court, when exercising any power, is required to give effect to the overriding purpose
expressed in s 56, that is, to facilitate the “just, quick and cheap” resolution of the real issues
in the proceedings. The sections that follow s 56 are: s 57 Objects of case management, s 58
Court to follow dictates of justice, s 59 Elimination of delay and s 60 Proportionality of costs.
Sections 57 and 58 are congruent with “just”, s 59 with “quick” and s 60 with “cheap”. It is
to be noted that ss 57 and 58(1) and (2)(a) are mandatory, whereas s 58(2)(b) is discretionary.
The NSW Attorney-​General in the Civil Procedure Act 2005 Second Reading Speech8 said:
Civil Procedure Bill 2005 represents an important advance in how civil litigation is conducted
in this State. … It is important to note that the dictates of justice will not be limited to the
dictates of justice only as between the parties, which has been argued to be the effect of the
majority judgment in one of the leading cases on case management –​Queensland v JL Holdings
Pty Ltd.
See generally Kumar M and Legg M (eds), Ten Years of the Civil Procedure Act 2005 (NSW)
(Thomson Reuters, 2015).
Civil Procedure Act 2005 (NSW)
[2.140] Civil Procedure Act 2005 (NSW) ss 56–​60
Part 6 –​Case Management and Interlocutory Matters
Division 1 –​Guiding principles
56 Overriding purpose
(cf SCR Pt 1 r 3)
(1)
The overriding purpose of this Act and of rules of court, in their application to civil proceedings,
is to facilitate the just, quick and cheap resolution of the real issues in the proceedings.
(2)
The court must seek to give effect to the overriding purpose when it exercises any power given
to it by this Act or by rules of court and when it interprets any provision of this Act or of any
such rule.
8
The Hon Bob Debus, Attorney General, and Minister for the Environment, NSW, Legislative Assembly,
Hansard and Papers (Wednesday 6 April 2005). See https://​
www.parliament.nsw.gov.au/​
bill/​
files/​
445/​
A2805.pdf.
[2.140]
79
Civil Procedure in New South Wales
Civil Procedure Act 2005 (NSW) cont.
(3)
A party to civil proceedings is under a duty to assist the court to further the overriding purpose
and, to that effect, to participate in the processes of the court and to comply with directions
and orders of the court.
(4)
Each of the following persons must not, by their conduct, cause a party to a civil dispute or
civil proceedings to be put in breach of a duty identified in subsection (3):
(a)
any solicitor or barrister representing the party in the dispute or proceedings,
(b)
any person with a relevant interest in the proceedings commenced by the party.
(5)
The court may take into account any failure to comply with subsection (3) or (4) in exercising
a discretion with respect to costs.
(6)
For the purposes of this section, a person has a “relevant interest” in civil proceedings if the
person:
(a)
provides financial assistance or other assistance to any party to the proceedings, and
(b)
exercises any direct or indirect control, or any influence, over the conduct of the
proceedings or the conduct of a party in respect of the proceedings.
Note. Examples of persons who may have a relevant interest are insurers and persons who fund
litigation.
57 Objects of case management
(1)
(2)
For the purpose of furthering the overriding purpose referred to in section 56(1), proceedings
in any court are to be managed having regard to the following objects:
(a)
the just determination of the proceedings,
(b)
the efficient disposal of the business of the court,
(c)
the efficient use of available judicial and administrative resources,
(d)
the timely disposal of the proceedings, and all other proceedings in the court, at a cost
affordable by the respective parties.
This Act and any rules of court are to be so construed and applied, and the practice and
procedure of the courts are to be so regulated, as best to ensure the attainment of the objects
referred to in subsection (1).
58 Court to follow dictates of justice
(1)
In deciding:
(a)
(b)
whether to make any order or direction for the management of proceedings, including:
(i)
any order for the amendment of a document, and
(ii)
any order granting an adjournment or stay of proceedings, and
(iii)
any other order of a procedural nature, and
(iv)
any direction under Division 2, and
the terms in which any such order or direction is to be made,
the court must seek to act in accordance with the dictates of justice.
(2)
For the purpose of determining what are the dictates of justice in a particular case, the court:
(a)
must have regard to the provisions of sections 56 and 57, and
(b)
may have regard to the following matters to the extent to which it considers them
relevant:
(i)
80
[2.140]
the degree of difficulty or complexity to which the issues in the proceedings
give rise,
Case Management in New South Wales
Chapter 2
Civil Procedure Act 2005 (NSW) cont.
(ii)
the degree of expedition with which the respective parties have approached
the proceedings, including the degree to which they have been timely in their
interlocutory activities,
(iii)
the degree to which any lack of expedition in approaching the proceedings has
arisen from circumstances beyond the control of the respective parties,
(iv)
the degree to which the respective parties have fulfilled their duties under
section 56(3),
(v)
the use that any party has made, or could have made, of any opportunity that
has been available to the party in the course of the proceedings, whether under
rules of court, the practice of the court or any direction of a procedural nature
given in the proceedings,
(vi)
the degree of injustice that would be suffered by the respective parties as a
consequence of any order or direction,
(vii)
such other matters as the court considers relevant in the circumstances of
the case.
59 Elimination of delay
(cf Western Australia Supreme Court Rules, O 1 r 4A)
In any proceedings, the practice and procedure of the court should be implemented with the
object of eliminating any lapse of time between the commencement of the proceedings and their
final determination beyond that reasonably required for the interlocutory activities necessary for the
fair and just determination of the issues in dispute between the parties and the preparation of the
case for trial.
60 Proportionality of costs
In any proceedings, the practice and procedure of the court should be implemented with the object
of resolving the issues between the parties in such a way that the cost to the parties is proportionate
to the importance and complexity of the subject-​matter in dispute.

Amendment of s 56
[2.150] Schedule 6.2 of the Courts and Crimes Legislation Further Amendment Act 2010
(NSW) amended s 56 of the CPA to extend the obligations it imposes in two ways. First, to
civil disputes rather than just litigation so as to support the addition of pre-​action protocols
in Pt 2A of the CPA9 and, second, to any person with a relevant interest in the proceedings,
including litigation funders: see [8.1010]. Part 2A was repealed by the Courts and Other
Legislation Further Amendment Act 2013 (NSW), which also deleted the additions to s 56
that facilitated Pt 2A.
9
The provisions of Pt 2A and the background to its introduction and subsequent repeal are set out
in Boniface D, Kumar M and Legg M, Principles of Civil Procedure in NSW (2nd ed, Thomson Reuters,
2012) [2.360]–​[2.420].
[2.150]
81
Civil Procedure in New South Wales
HOW HAS PT 6 OF THE CPA AFFECTED CIVIL PROCEDURE?
Metropolitan Petar v Mitreski
[2.160] Metropolitan Petar v Mitreski [2008] NSWSC 293
YOUNG CJ in Eq
[11] Under Part 6 of the Civil Procedure Act 2005, the guidelines for dealing with case management
and procedural applications have changed considerably from the previous regime. How this came
about was that for many years in New South Wales, judges in the Equity Division and the previous
Commercial Division, now part of this Division, have been making orders directed to the just, quick
and cheap resolution of real issues in proceedings. That practice and other considerations were
adopted by the Woolf Report in England into civil procedure and as a result of the Woolf Report, the
Civil Procedure Rules 1998, known by everybody as CPR, came into effect in England on 26 April 1999.
[12] The very first rule, CPR 1.1(1), declared that the rules constituted a new procedural code with
the overriding objective of enabling the court to deal with cases justly. Although this seems to be a last
minute addition to the CPR from the original drafts, judges in England have put considerable emphasis
on it. So much so that it is now said that when the rules deal with the just resolution of disputes in a
court, this does not mean merely deciding the merits according to procedural fairness, there is now a
new three dimensional concept of procedural justice. The principal goal of civil procedure, namely the
doing of substantive justice, is now overlaid with an overriding objective that establishes a procedural
discipline so that the court reaches a substantially correct outcome by means of proportionate
resources and in a reasonable time. See, for instance, Zuckerman, Civil Procedure (2003) at para 1.2.
[13] Part 6 of the New South Wales Act obviously draws on the English experience and so uses the
words “overriding purpose”. Section 56, referring to the overriding purpose of the Act and rules of
court as facilitating the just, quick and cheap resolution of the real issues, is supplemented by ss 57
through to 60. Section 57 says that for the purpose of furthering the overriding purpose, proceedings
in the court are to be managed having regard to the following objects:
(a)
the just determination of the proceedings;
(b)
the efficient disposal of the business of the court;
(c)
the efficient use of available judicial and administrative resources;
(d)
the timely disposal of the proceedings, and all other proceedings in the court, at a cost
affordable by the respective parties.
[14] Section 58 then says that in deciding what orders to make in an application during the
case management process, the court must seek to act in accordance with the dictates of justice.
Subsection (2) then fleshes out what are the dictates of justice in any particular case. Accordingly,
one is not now dealing with what in the old days was called “entitlements to an order” and focusing
principally on the rights of a party in litigation, but one is now looking at a much broader picture, that
is, the overall just disposal of the proceedings within a reasonable time. Accordingly, when a court
is making case management orders, the court is required more to focus on sections 56 to 60 of the
Uniform Civil Procedure Act than on utterances made under the old procedure which focused more
on the rights of parties.

Tripple Take v Clark Rubber Franchising
[2.170] Tripple Take Pty Ltd v Clark Rubber Franchising Pty Ltd; Brooks v Clark Rubber Franchising Pty Ltd
[2005] NSWSC 1169
82
[2.160]
Case Management in New South Wales
Chapter 2
Tripple Take v Clark Rubber Franchising cont.
EINSTEIN J
[7]‌The Overriding Purpose of the Civil Procedure Act 2005 and of the rules of court, now enshrined
in s 56 of the Civil Procedure Act 2005, is to facilitate the just, quick and cheap resolution of the
real issues in the proceedings. Each of the objects of case management now to be found in s 57 of
the Act as well as the criteria concerning the determination of what are the dictates of justice in a
particular case [to be found in s 58(2)] mandate the principled exercise of the material discretion
being to dismiss the instant application for security for costs. S 58(2)(b) requires the Court to take into
account, inter alia, the degree of expedition with which the respective parties have approached the
proceedings, including the degree to which they have been timely in their interlocutory activities, as
well as the use that any party could have made of any opportunity that has been available to the party
in the course of the proceedings, and of course also the degree of injustice that would be suffered by
the respective parties as a consequence of any order or direction.
[8]‌None of these matters is particularly novel but one now has in statutory form, a signal emphasis
on the significance of close attention being paid to the duty imposed upon parties to civil proceedings,
to assist the court to further the overriding purpose and, to that effect, to participate in the processes
of the court: here to ensure the efficient disposal of the business of the court and the timely disposal
of the proceedings at a cost affordable by the respective parties.

DIRECTIONS
[2.180] The objects of case management identified in the CPA and the UCPR are the just
determination of proceedings; the efficient disposal of the business of the court; the efficient use
of available judicial and administrative resources; and the timely disposal of the proceedings,
and all other proceedings in the court, at a cost affordable by the parties.
The CPA also requires the practice and procedure of the court to be implemented with
the object of eliminating unnecessary delay, and court practices and procedures are required
to be implemented with the object of resolving issues, so that the costs to the parties are
proportionate to the importance and complexity of the subject matter in dispute.
Former Chief Justice Spigelman in 200610 said:
In order to serve the overriding purpose, and to meet the other specified objectives, the courts
have a comprehensive range of powers including:
• Power to direct parties to take specified steps and to comply with timetables and otherwise
to conduct proceedings as directed.
• Powers with respect to the conduct of the hearing, including limiting the time that may
be taken in cross-​examination, limiting the number of witnesses, limiting the number of
documents that may be tendered, limiting the time that may be taken by a party in presenting
its case or in making submissions. [For example Stop Watch Hearings where the parties
agree about the total amount of time that will be allocated to a trial. The usual court order
will allocate blocks of time to different aspects of the case, in accordance with the parties’
expectations but that is subject to variation as the trial continues. A party may allocate its
time to whatever aspect it wishes, eg more time taken in cross-​examination will leave less
10
The Honourable JJ Spigelman AC, Chief Justice of New South Wales, Case Management in New South Wales
(presented to the Annual Judges Conference, Kuala Lumpur, Malaysia, 22 August 2006) http://​www.lawlink.
nsw.gov.au.
[2.180]
83
Civil Procedure in New South Wales
time for an opening or for oral submissions. The objective of a Stop Watch Hearing is to
achieve a more cost effective resolution of the real issues between the parties.]
• Powers are to be exercised subject to the requirements of procedural fairness and are to take
into account a range of relevant matters, including the subject matter and the complexity
or simplicity of the case, the efficient administration of court lists (including the interests of
parties to other proceedings before the court) and the costs of the proceedings, compared
with the quantum of the subject matter in dispute.
• The court is empowered at any time to direct a solicitor or barrister for a party to provide
to his or her client a memorandum stating the estimated length of the trial and estimated
costs of legal representation including costs payable to the other party if the client was
unsuccessful.
Case management is undertaken through a series of directions hearings before a judge or
registrar. The date of the first directions hearing will be given by the registry in a notice issued
at the time of filing the statement of claim. In the Supreme Court, the first directions hearing
will be appointed for approximately three months after proceedings are entered in the List.
Directions given at the directions hearing are binding and a range of sanctions are available
if they are breached.
Civil Procedure Act 2005 (NSW)
[2.190] Civil Procedure Act 2005 (NSW) ss 61–​63
Part 6 –​Case Management and Interlocutory Matters
Division 2 –​Powers of court to give directions
61 Directions as to practice and procedure generally
(cf SCR Pt 23 r 4; Act No 9 1973, s 68A)
(1)
The court may, by order, give such directions as it thinks fit (whether or not inconsistent
with rules of court) for the speedy determination of the real issues between the parties to the
proceedings.
(2)
In particular, the court may, by order, do any one or more of the following:
(3)
84
(a)
it may direct any party to proceedings to take specified steps in relation to the
proceedings,
(b)
it may direct the parties to proceedings as to the time within which specified steps in
the proceedings must be completed,
(c)
it may give such other directions with respect to the conduct of proceedings as it
considers appropriate.
If a party to whom such a direction has been given fails to comply with the direction, the court
may, by order, do any one or more of the following:
(a)
it may dismiss the proceedings, whether generally, in relation to a particular cause of
action or in relation to the whole or part of a particular claim,
(b)
it may strike out or limit any claim made by a plaintiff,
(c)
it may strike out any defence filed by a defendant, and give judgment accordingly,
(d)
it may strike out or amend any document filed by the party, either in whole or in part,
(e)
it may strike out, disallow or reject any evidence that the party has adduced or seeks to
adduce,
(f)
it may direct the party to pay the whole or part of the costs of another party,
(g)
it may make such other order or give such other direction as it considers appropriate.
[2.190]
Case Management in New South Wales
Chapter 2
Civil Procedure Act 2005 (NSW) cont.
(4)
Subsection (3) does not limit any other power the court may have to take action of the kind
referred to in that subsection or to take any other action that the court is empowered to take
in relation to a failure to comply with a direction given by the court.
62 Directions as to conduct of hearing
(cf Act No 52 1970, s 87; Act No 9 1973, s 77(4); SCR Pt 34 rr 6 and 6AA)
(1)
The court may, by order, give directions as to the conduct of any hearing, including directions
as to the order in which evidence is to be given and addresses made.
(2)
The court may, by order, give directions as to the order in which questions of fact are to
be tried.
(3)
Without limiting subsections (1) and (2), the court may, by order, give any of the following
directions at any time before or during a hearing:
(4)
(5)
(6)
(a)
a direction limiting the time that may be taken in the examination, cross-​examination
or re-​examination of a witness,
(b)
a direction limiting the number of witnesses (including expert witnesses) that a party
may call,
(c)
a direction limiting the number of documents that a party may tender in evidence,
(d)
a direction limiting the time that may be taken in making any oral submissions,
(e)
a direction that all or any part of any submissions be in writing,
(f)
a direction limiting the time that may be taken by a party in presenting his or
her case,
(g)
a direction limiting the time that may be taken by the hearing.
A direction under this section must not detract from the principle that each party is entitled to
a fair hearing, and must be given a reasonable opportunity:
(a)
to lead evidence, and
(b)
to make submissions, and
(c)
to present a case, and
(d)
at trial, other than a trial before a Local Court sitting in its Small Claims Division, to
cross-​examine witnesses.
In deciding whether to make a direction under this section, the court may have regard to the
following matters in addition to any other matters that the court considers relevant:
(a)
the subject-​matter, and the complexity or simplicity, of the case,
(b)
the number of witnesses to be called,
(c)
the volume and character of the evidence to be led,
(d)
the need to place a reasonable limit on the time allowed for any hearing,
(e)
the efficient administration of the court lists,
(f)
the interests of parties to other proceedings before the court,
(g)
the costs that are likely to be incurred by the parties compared with the quantum of
the subject-​matter in dispute,
(h)
the court’s estimate of the length of the hearing.
At any time, the court may, by order, direct a solicitor or barrister for a party to give to the
party a memorandum stating:
[2.190]
85
Civil Procedure in New South Wales
Civil Procedure Act 2005 (NSW) cont.
(a)
the estimated length of the trial, and the estimated costs and disbursements of the
solicitor or barrister, and
(b)
the estimated costs that, if the party were unsuccessful at trial, would be payable by
the party to any other party.
63 Directions with respect to procedural irregularities
(cf Act No 52 1970, s 81; Act No 9 1973, s 159; Act No 11 1970, s 75A)
(1)
This section applies to proceedings in connection with which there is, by reason of anything
done or omitted to be done, a failure to comply with any requirement of this Act or of rules of
court, whether in respect of time, place, manner, form or content or in any other respect.
(2)
Such a failure:
(3)
(4)
(a)
is to be treated as an irregularity, and
(b)
subject to subsection (3), does not invalidate the proceedings, any step taken in the
proceedings or any document, judgment or order in the proceedings.
The court may do either or both of the following in respect of proceedings the subject of a
failure referred to in subsection (1):
(a)
it may, by order, set aside the proceedings, any step taken in the proceedings or any
document, judgment or order in the proceedings, either wholly or in part,
(b)
it may exercise its powers to allow amendments and to make orders dealing with the
proceedings generally.
The court may not take action of the kind referred to in subsection (3)(a) on the application of
any party unless the application is made within a reasonable time and, in any case, before the
party takes any fresh step in the proceedings after becoming aware of the failure.

Uniform Civil Procedure Rules 2005 (NSW)
[2.200] Uniform Civil Procedure Rules 2005 (NSW) rr 2.1–​2.3
2.1 Directions and orders
The court may, at any time and from time to time, give such directions and make such orders for the
conduct of any proceedings as appear convenient (whether or not inconsistent with these rules or any
other rules of court) for the just, quick and cheap disposal of the proceedings.
Note: See also the guiding principles in relation to the conduct of court proceedings (set out
in Division 1 of Part 6 of the Civil Procedure Act 2005) and the general powers of the court to give
directions (set out in Division 2 of that Part).
2.2 Appointment for hearing
The court may, at any time and from time to time, of its own motion, appoint a date for a hearing at
which it may give or make the directions or orders referred to in rule 2.1.
2.3 Case management by the court
Without limiting the generality of rule 2.1, directions and orders may relate to any of the following:
(a)
the filing of pleadings,
(b)
the defining of issues, including requiring the parties, or their legal practitioners, to exchange
memoranda in order to clarify questions,
86
[2.200]
Case Management in New South Wales
Chapter 2
Uniform Civil Procedure Rules 2005 (NSW) cont.
(c)
the provision of any essential particulars,
(d)
the filing of “Scott Schedules” referred to in rule 15.2,
(e)
the making of admissions,
(f)
the filing of lists of documents, either generally or with respect to specific matters,
(g)
the delivery or exchange of experts’ reports and the holding of conferences of experts,
(h)
the provision of copies of documents, including their provision in electronic form,
(i)
the administration and answering of interrogatories, either generally or with respect to specific
matters,
(j)
the service and filing of affidavits, witness statements or other documents to be relied on,
(k)
the giving of evidence at any hearing, including whether evidence of witnesses in chief must
be given orally, or by affidavit or witness statement, or both,
(l)
the use of telephone or video conference facilities, video tapes, film projection, computer and
other equipment and technology,
(m)
the provision of evidence in support of an application for an adjournment or amendment,
(n)
a timetable with respect to any matters to be dealt with, including a timetable for the conduct
of any hearing,
(o)
the filing of written submissions.

THE APPLICATION OF THE CPA AND UCPR
Hans Pet Constructions v Cassar
[2.220] Hans Pet Constructions Pty Ltd v Cassar [2009] NSWCA 230
ALLSOP ACJ
The litigation in the Local Court
[3]‌The appellant, Hans Pet Constructions Pty Ltd (“Hans Pet”), is a builder which subcontracted tiling
work on a job to the respondents, Mr and Mrs Cassar. Hans Pet alleged that the work of the Cassars
was defective. These assertions of Hans Pet were made in mid-​2007 and substantiated at that time by
the delivery of an expert’s report as to deficiencies in the work.
[4]‌In November 2007, proceedings were commenced in the Local Court by way of statement
of claim in which Hans Pet claimed unliquidated damages, but quantifying same in the sum of
$55,884.74, being the asserted cost of removing the tiles laid by Mr Cassar and replacing them with
new tiles.
[5]‌On 3 January 2008, the Cassars filed a defence which was summarised by the primary judge at
[4] of his reasons as follows:
That defence, which is in evidence before this Court, denied the existence of a contract to
perform tiling sub-​contract work, admitted a duty to use reasonable care, skill and diligence
if sub-​
contracting tiling work was performed for Hans Pet, admitted that they offered
to undertake tiling sub-​contract work, denied the terms of the contract and “admitted”
that tiling services “on a labour only basis” were provided and otherwise denied faulty
workmanship. Further, the defence claimed contributory negligence, estoppel, failure to
mitigate and the defence also put the quantum of damage in issue. As one would expect,
[2.220]
87
Civil Procedure in New South Wales
Hans Pet Constructions v Cassar cont.
Hans Pet bore the onus of proof in the proceedings before the Local Court, at least on the
substantive question before the Local Court.
[6]‌On 26 February 2008, directions were made by the Local Court, setting the matter down for
hearing for three days by way of a special fixture commencing Monday 28 July 2008 and requiring
the plaintiff to serve its evidence in chief (including expert evidence) by 18 April 2008, the defendants
to serve their evidence by 30 May 2008 and the plaintiff to file evidence in reply by 20 June 2008. The
matter was also listed for “review”, by way of pre-​trial directions, on 1 July 2008.
[7]‌ … The reforms of the system of civil litigation in New South Wales in recent years, typified by
the Civil Procedure Act and the Uniform Civil Procedure Rules reflect the deliberate governmental
(Parliamentary, executive and judicial) aims of promoting and facilitating the speedy disposition of
proceedings in order that citizens of the State can obtain prompt resolution of their complaints.
These matters must be steadily borne in mind at all times. Though I am of the view that the learned
Magistrate erred in making the order he did, nothing that I say in explication of my reasons for that
view should be taken as undermining or weakening the considerable authority of judicial officers to
control and manage litigation in order that it proceed with the utmost expedition in the interests of
both private and public resources in the State. It is necessary, however, in managing and supervising
litigation to that end to ensure that proper consideration is given to all factors identified by the
Parliament of New South Wales as compulsory to consider and have regard to in the exercise of the
powerful case management tools now given to judicial officers at all levels in the State.
[8]‌The directions that had been given here also concerned further and better particulars. There
was a complaint by the solicitors for the Cassars that these had not been provided by Hans Pet. The
matter was brought back to the Court on 10 April 2008. Directions were made varying those made
earlier on 26 February as to the provision of particulars and the timing of filing and service of evidence
in chief, response and reply. The timetable was pushed back so that the evidence in reply was to be
served no later than 11 July 2008 and the review date was moved to 22 July 2008.
[9]‌The Cassars did not receive the answers to their requests for further and better particulars as
directed or in the time directed. There was correspondence between the parties. The answers to
particulars were provided on 5 June 2008 some seven weeks after the date provided by the court
orders. Further, it was not until 16 June 2008 that Hans Pet served the remainder of evidence and
indicated that it would not rely upon any further evidence. That evidence had been due on 23 May
2008. The expert evidence of Hans Pet, however, had been served on 23 May 2008 in accordance
with the directions, and it should be recalled that a body of expert evidence had been provided the
previous year.
[10] On 23 June 2008 the solicitors on behalf of the Cassars wrote to the solicitors for Hans Pet
noting the hearing date and asserting that Hans Pet’s delay in providing answers to the particulars
had caused the Cassars not to be able to meet the present timetable and, necessarily, a new date was
required. The letter sought consent to the matter being relisted before the Local Court for the purpose
of securing a new timetable and, necessarily, a new date. The letter also informed Hans Pet that the
particulars that had been provided had necessitated further investigation and that the expert who
had been engaged by the Cassars would not be able to provide his report by the dates specified in
the Court’s directions. An amended defence was filed which expanded on the grounds relied on for
mitigation and repleaded the issue of quantum and raised causation.
[11] There was a further exchange of correspondence between the solicitors and by 8 July 2008 it
became apparent that there was no agreement to vacate the hearing dates.
[12] On 9 July 2008 the solicitors for the Cassars advised the Local Court of the difficulties and
sought a directions hearing date for the purpose of vacating the hearing date set. On 15 July 2008 the
legal representatives of the Cassars once again rang the Registrar of the Local Court to follow up the
letter of 9 July 2008 and to request a relisting before 22 July 2008. The evidence before the primary
88
[2.220]
Case Management in New South Wales
Chapter 2
Hans Pet Constructions v Cassar cont.
judge was that the Cassars solicitors were advised that it was likely that the matter would be dealt
with on 22 July at the review date. No notice of motion was filed seeking the vacation of the dates.
[13] It was in these circumstances that the matter came before the learned Magistrate on
22 July 2008.
[14] Before turning to the transcript of what occurred it is perhaps appropriate to say the following.
Any judge who has had experience in either running a list or in case managing litigation will be
familiar with the kinds of dispute apparently raised by the parties and described above. It is often
very difficult to ascertain the legitimacy of the complaints of both defendants and plaintiffs when
they assert a failure to provide particulars and when they assert they are not able to put on evidence
or pleadings until they have particulars. The legitimacy of those kinds of assertions are sometimes
questionable and can, on occasions, be a diversion from the real reasons for timely preparation, which
are sometimes a failure to attend to the task in hand because of either busyness or, in some cases,
idleness. I am not concluding that any of these illegitimate considerations attended the conduct
of the file by the Cassars’ solicitors. There was no detailed investigation of the legitimacy of these
complaints by the learned Magistrate. That is not a criticism of him. Very often the time and trouble
and expenditure of energy in resolving these kinds of dispute can outweigh any utility in doing so.
That said, however, a judge or registrar will often act upon the sense or intuition of who is responsible
in tailoring directions in circumstances where those directions are unlikely to prejudice irretrievably
a party. Where, however, a party is to be prejudiced irretrievably in the conduct of its litigation by
the failure to comply with a timetable it will rarely be appropriate so to affect the party without an
investigation and a conclusion that it was the party involved who was at least in part responsible for
the default, so as to justify such irretrievable prejudice. With those introductory remarks, I turn to the
record of the hearing before the Magistrate.
…
[20] A matter was interposed. After the adjournment, the following exchange took place:
Zickman: Your Honour, we’re somewhat in the court’s hands. I’ve made some inquiries
as your Honour requested. The position is that we could probably have our lay evidence
completed by the end of this week, but the expert has just returned from overseas and we
would not be able to have our expert evidence completed by the end of this week. Your
Honour, in regard to –​your Honour was asking why you should not strike this matter out. My
instructions are that particulars weren’t provided eighteen days late, but were some seven
weeks late. We are in this position not because of choice. First of all, we are here because
we’ve lost seven weeks in the programme, not through our fault.
Maloney: My instructions are that they were eighteen days late as I submitted before.
Having said that, as much as I want to accept your [Honour’s] urging that the matter
proceed, in reality, the plaintiff accepts that if expert evidence is served upon my client on
Friday, or lay evidence, the matter cannot proceed. My client will end up prejudiced, my
client will end up running this matter with evidence it has received the last business day prior
to the commencement of the hearing. As much as [I]‌don’t want to make this submission,
I can’t place my client in a position where my client is going to be prejudiced by having all
this material put on the last minute. I accept that the court wants these matters dealt with
expeditiously, certainly in the spirit of the new Act. Having said that, I’m going to bite the
bullet and say, this is a matter that probably cannot proceed on Monday, simply because my
client will be put in a situation where my client will not be able to respond properly to this.
We can’t really have a hearing that starts off dealing with some issues and then goes over for
the balance of it; it just really doesn’t work.
His Honour: As I understand it, the defendant is saying that they cannot have their
evidence on by the hearing date.
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Hans Pet Constructions v Cassar cont.
Maloney: That’s the case. They say they can have some of it on, but they can’t have any
of the expert evidence. It’s really, when it all boils down to it, I don’t think there’s really going
to be a great issue on the facts of this case. The case relates to a tiling job, a whole house
was tiled. The tiles started to lift. The expert for the plaintiff says, you know, it was caused
by various things. It is going to be a case that is going to be dealt with by experts ultimately.
What I’m saying to your Honour is, without the expert evidence, the matter cannot properly
be determined by the court.
…
Zickman: Your Honour, the position is this. That when the directions were made, the
hearing date was set. We had an extra seven weeks in that period. Experts were available
to do certain things. We only received those, on my instructions, particulars, some seven
weeks late. We foreshadowed to the other side and you will see when you look at the notice
of motion and the orders that were made, that we were given leave to amend our defence
because we just didn’t know what the case was we had to meet up to that point. So we are
saying we will get the expert evidence, but what’s the answer to these twenty-​five questions
which they have been resisting. Once we finally got those particulars in June, we were able to
brief our expert and say, well, here’s this, then we received their expert evidence. He started
to prepare a response to this.
Your Honour, we are completely mindful of the fact that your Honour is rightly annoyed
about this.
His Honour: The situation is this, as I understand it. The last communication where all the
particulars were in, correct me if I’m wrong, all the particulars were in and all the evidence
was in by 16 June.
Maloney: That’s right. The final lay evidence for the plaintiff was filed, that was the last
step that’s been done in the proceedings, it was on 16 June. Particulars pre-​dated that. The
expert evidence was a year ago.
Zickman: Your Honour, the reality is that we have had an expert engaged in this
matter who–​
His Honour: Do you agree with me that all evidence and all particulars were to you by
16 June?
Zickman: Your Honour, that sounds about correct. But your Honour, if I can just say this–​
His Honour: In that case, what you have is from 16 June to 22 July, a period of six weeks, in
which to get your evidence together, based on particulars and based on the expert’s report
that, as I understand it, was served in May 2007. So you’ve had particulars for six weeks, but
you’ve had the expert’s report, this is correct since May 2007?
Maloney: March 2007, your Honour.
His Honour: March 2007. So, you’ve had six weeks to completely prepare your case and
you’re telling me now on the review date, that you can’t complete your evidence by the time
the matter is set for hearing.
Zickman: My instructions are that my expert went out when this matter first surfaced, so
he was someone who went out and had a look before the remedial work was done, so we
weren’t in a position to get any other expert. So he went out and he prepared a preliminary
response, but not an expert report. Once we got the particulars, it became clear there was a
lot of things that the expert failed to deal with. I wasn’t involved in this, but as I understand
it, the expert has subsequently been away overseas for the best part of the protracted period.
Your Honour, with respect, he couldn’t deal with it. We could not get another expert because
he was the only person who went and looked before all the tiles were pulled up. Once the
tiles had been pulled up, there wasn’t anyone else in a position to do that.
His Honour: I will consider it over morning tea. I must say I am minded to simply strike
out the defence. I just cannot justify a three-​day hearing with a magistrate allocated to sit,
being thrown away four days before the hearing is meant to start. It’s just an outrageous
waste of public money. The courts are not that flexible that we can just –​and I have at the
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Hans Pet Constructions v Cassar cont.
forefront of my mind –​that what we are effectively doing is throwing away three days of
court time, because of non-​compliance, when you’ve had six weeks since the particulars are
in and you have had since March 2007 since the expert’s report is in. But I will re-​read the
correspondence on my file and I will give you a determination at, say, 12 o’clock. …
[21] I have set out the debate at length because it reveals what might be said to be a not uncommon
set of circumstances –​almost an archetypal example of the tension between the need for compliance
with timetables and the common experience of their not being complied with for reasons that are
debatable. Here, there was a small building case, with the mechanics of its conduct reduced to a
dispute about particulars, when in all likelihood, an exchange of views of experts early would have
helped to resolve the matter. The protestations of counsel for the defendants might be thought,
possibly, to cover a less than diligent application to the task at hand by the defendants. The Magistrate
was less than impressed. He was fully entitled to take that view. Importantly, the Court’s resources and
the speedy disposition of the matter had been compromised. Whether or not that consequence was
one for which the defendants were solely to blame may, however, be open to question. Nevertheless,
his Honour returned and delivered an oral judgment.
[22] His Honour first recited the facts, emphasising a three day special fixture. He noted that
the plaintiff was at fault to some degree, but that the defendants had had since 16 June to deliver
all their evidence. He noted the inappropriateness of seeking to vacate a date without a notice of
motion, referring to Practice Note 1. The next point dealt with was the over-​riding provisions of the
Civil Procedure Act, s 56. Dennis v Australian Broadcasting Commission [2008] NSWCA 37 at [28] and
[29] was referred to and quoted from. These paragraphs involved a specific point being made by the
Court that Queensland v JL Holdings Pty Ltd [1997] HCA 1; 189 CLR 146 had been the subject of, at
least partial, statutory change by s 56. The Magistrate emphasised the relevant case management
considerations in the following passages:
Such authority also applies to vacation of hearing dates where there is no notice of motion
and where there has been a failure to comply with the orders of the court. After all, if the
orders of the court are not complied with, it brings the law into disrepute. More than that,
it delays matters; and more than that, where a magistrate has been specially allocated to
a special fixture and three clear working days apply to that, a party who have been non-​
compliant seeks to vacate the hearing date without a notice of motion, without any warning
by the way of appropriate process through the court, then the allocation of resources to
the community of New South Wales must be … (not transcribable) … case management,
must be able to take into account and determine whether the parties will have a further
opportunity to comply with orders of the court.
After all, if the party has not complied with an order of the court, that is if the matter
has been listed since February for hearing in July, then one has to wonder whether there is
ever going to be compliance. Of course when a matter is simply moved in court as it were,
or more appropriately moved, of course, it is difficult for the court to know what evidence
there is. All I can see is submissions as to why the matter ought to be vacated, and those
submissions essentially seem to me from my notes that I took, that the expert is overseas and
will not be returning in time, that because of the loss of some weeks because of the plaintiff’s
failure to comply, nothing has been done. The defendant simply cannot get its evidence on
within the timeframe that has been set by the court. Keep in mind that that timeframe was
set by the court in February and there has been substantial compliance by the plaintiff in the
sense that six weeks ago, they had completed all their particulars, over twelve months ago
they had served their … (not transcribable) … statements.
[23] The Magistrate returned to the question of the failure to file a motion. He then said the
following:
It is a question, in my view, of balancing the two obligations to the court.
[2.220]
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Hans Pet Constructions v Cassar cont.
(1) to provide a forum for parties, the fundamental duty as it is often described, provide a
forum for the parties to resolve their disputes and giving them an opportunity to them
to be heard and determined according to the rules and according to law.
(2) is providing for the quick, just and cheap resolution of those problems … (not
transcribable) … that compliance with the Practice Notes and compliance with
directions of the court.
Further, if necessary, with a view to ensuring that there is efficient and effective case
management of these matters and in the case of … (not transcribable) … the magistrate is
not left to pick up work or having to pick up other work or be reallocated other work if it is
at all possible in such a short time-​frame prior to the hearing date.
[24] His Honour then referred to Allen v Sir Alfred McAlpine & Sons Ltd [1968] 2 QB 229 and the effect
of delay in denying justice and the decision of Campbell J (as his Honour then was) in Szczygiel v Peeku
Holdings [2006] NSWSC 73 in support of his Honour’s emphasis on s 56. He then said:
But in considering all of those factors, in my view, the defendant has had a … (not
transcribable) … of complying within a very reasonable timetable, say, in particular, since
16 June 2008 it has not complied with the court’s directions, it has not complied with
practice directions, it rises to seek a vacation of a hearing date without a notice of motion
and thus in breach of not only the rules of the court, but also in breach … (not transcribable)
… overriding obligation to ensure a quick, just and cheap resolution of matters, and its
overriding obligation to ensure that the people of New South Wales are served by a system
of justice that does not allow parties to simply obtain a vacation of hearing dates in such an
expensive and wasteful manner as in this case.
Taking into account all of those factors and the balance of tests that I must apply between
the fundamental duty of this court to resolve disputes and the s 56 and … (not transcribable)
… type considerations, in my view, it is … (not transcribable) … that the defence is to be
struck out.
[25] His Honour then went on to make the following order:
The defence is struck out, the hearing is vacated. The hearing of 28, 29 and 30 July is vacated.
[29] … [T]‌he hearing on liability was vacated but a hearing on damages was fixed. In effect, the
defence was struck out and judgment on liability entered. This approach terminated the possibility of
the defendants having their case heard once and for all, even if only on the plaintiff’s evidence.
[30] The appeal to the Supreme Court in a large number of paragraphs raised three essential
complaints:
(a)
The first was that the Magistrate gave undue weight to case management and insufficient
weight to the consequence of depriving the defendants of a hearing on the merits, in
circumstances where Hans Pet had been partially to blame for the delay.
(b)
The second focused upon the weight given by the Magistrate to the failure to file a notice
of motion to vacate the date and upon the proposition that striking out the defence was
disproportionate to the default of the defendants.
(c)
The third was that the decision of the magistrate constituted a denial of procedural fairness.
[31] The learned primary judge recognised the caution that should be exercised in the review of
exercises of discretion in practice and procedure, referring to House v R [1936] HCA 40; 55 CLR 499
at 504–​507. The primary judge thought that the Magistrate had considered all relevant matters,
[but found]
[34] … Mr and Mrs Cassar have been denied natural justice, because they have been denied the
opportunity of presenting their case based upon the defence filed and served in accordance with the
court’s directions. It is not suggested that the defence is either embarrassing or does not disclose a
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Hans Pet Constructions v Cassar cont.
proper defence. The refusal to grant an indulgence, where there has been adequate opportunity to
comply with directions, is not a denial of procedural fairness. By the striking out of a defence, already
filed, is such a denial.
[35] The Cassars put forward a Notice of Contention supported by the same submissions put to
the primary judge which included submissions that the Civil Procedure Act, ss 56–​58 had not been
applied in a judicial and proportionate manner.
Disposition of the appeal
[36] The arguments before this court illuminated the difficulty of review of a decision such as that
made by the Magistrate. The Civil Procedure Act, ss 56–​61 brings about a new statutory balance
among various factors in litigation including court and party efficiency and the delivery of individual
justice. Delay and case backlog are not merely factors affecting the public cost of delivering justice, they
corrode the ability of the courts to provide individual justice. Especially in a court as busy as the Local
Court, it is vital that the judicial system work in a way that denies, categorically, the party against whom
a legitimate claim or grievance is brought the opportunity to say, with justification: “So I owe you $x,
what are you going to do about it? Sue me in Court? That will take years.” The reforms that have taken
place under the Civil Procedure Act and the evident attempt by the Local Court to ensure efficiency of
service for the public can thus be seen not merely to reflect worthy governmental and judicial efforts
for efficiency, but also to be vital for the provision of timely individual justice. To these salutary ends
significant powers of case management have been placed in the hands of judicial officers which, if
exercised, can often be seen to have sharp, and sometimes detrimental effects on the claims of parties.
Such consequences can be seen in the very nature of the powers in the Civil Procedure Act, s 61(3) ….
[37] The placing of the kinds of power found in the Civil Procedure Act, s 61 in the hands of
all judicial officers has been made expressly subject to s 58, the terms of which are important. In
s 58(1) it is made clear that the Court must seek to act “in accordance with the dictates of justice”.
Section 58(2) then gives content to this phrase: […].
[38] What is vital to appreciate is that the regard to both ss 56 and 57 is statutorily compulsory: s 58(2)
(a). They are considerations that are relevant in the sense discussed in Minister for Aboriginal Affairs v
Peko-​Wallsend Ltd [1986] HCA 40; 162 CLR 24. That is, they are relevant in the sense that the statute
requires them to be taken into account. The factors in s 58(2)(b) may be taken into account but
whether they are is a matter for the tribunal.
[39] Section 57 is in the following terms:
(1)
(2)
For the purpose of furthering the overriding purpose referred to in section 56(1), proceedings
in any court are to be managed having regard to the following objects:
(a)
the just determination of the proceedings,
(b)
the efficient disposal of the business of the court,
(c)
the efficient use of available judicial and administrative resources,
(d)
the timely disposal of the proceedings, and all other proceedings in the court, at a cost
affordable by the respective parties.
This Act and any rules of court are to be so construed and applied, and the practice and
procedure of the courts are to be so regulated, as best to ensure the attainment of the objects
referred to in subsection (1).
[40] For the disposition of this appeal what appears in s 57(1), and in particular para (a), is vital.
[41] The content of the statutory requirement “to have regard to” a specific matter has been
discussed often and is not in dispute. Spigelman CJ (with whom Macfarlan JA and Young JA agreed)
said the following in Commissioner of Police for New South Wales v Industrial Commission of New South
Wales & Raymond Sewell [2009] NSWCA 198 at [73]:
A statutory requirement to “have regard to” a specific matter, requires the Court to give the
matter weight as a fundamental element in the decision-​making process. (R v Hunt; Ex parte
[2.220]
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Hans Pet Constructions v Cassar cont.
Sean Investments Pty Ltd (1979) 180 CLR 322 at 329; R v Toohey; Ex parte Meneling Station
Pty Ltd (1982) 158 CLR 327 at 333 and 337–​338; Zhang v Canterbury City Council [2001]
NSWCA 167; (2001) 51 NSWLR 589 at [71]–​[73]). An equivalent formulation is that the
matter so identified must be the focal point of the decision-​making process. (See Evans v
Marmont (1997) 42 NSWLR 70 at 79–​80; Zhang supra at [73].)
[42] Here the primary judge characterised the error of the Magistrate as the denial of natural justice.
Of course, there was no denial of any opportunity to be heard at the procedural argument before
the Magistrate. Rather, the Cassars had been denied an opportunity to be heard on the substantive
claim. Yet, as Hans Pet pointed out on appeal, such is the very kind of consequence contemplated by
s 61. For these reasons, the use of the phrase “natural justice” might be seen to have its difficulties: cf
Palmer Tube Mills (Aust) Pty Ltd v Semi [1998] 4 VR 439 at 452. The primary judge’s conclusion as to a
denial of procedural fairness can be seen to be a conclusion that the response of the Magistrate was
disproportionate to the conduct of the Cassars.
[43] In my view, the Magistrate did err for reasons that are advanced under the notice of contention.
There is no record in the transcript of the Civil Procedure Act, s 57 being expressly referred to. It is
possible that one of the “not transcribable” sections contained a reference to s 57. Practice Note 1
contains a reference s 57 and it (the practice note) was referred to. However, nowhere in the reasons
of the Magistrate and discussion that preceded can one find the Magistrate having regard to s 57(1)
(a) as a matter to be given weight as a fundamental element in the decision making process. If he had
given it weight, it may well have been outweighed by other factors, though it is difficult to see how
any proportionate response to a failure to file evidence could require more than a refusal to vacate the
dates and a decision that the resolution of the parties’ controversy should proceed on the evidence
then filed.
[44] It was submitted that the Cassars had the opportunity to choose that course and rejected it.
The transcript does not reveal this; and, in any event, it was not a matter of choice for them.
[45] The effect of the Magistrate’s orders was not to vacate the dates but also to deny the Cassars
the use of the dates even without evidence, except as to quantum. This order was made without
giving the kind of weight Parliament has said was compulsory to the factor in s 57(1)(a).
[46] As the Court of Appeal of Victoria said in British American Tobacco Australia Services Ltd v Cowell
(Representing the Estate of McCabe (deceased)) [2002] VSCA 197; 7 VR 524 at 588 [178] about the
power to strike out pleadings for default, the power is not intended to be used to punish the litigant.
The proportional use of the powers in s 61 is brought about by giving the fundamental weight to the
(sometimes competing) considerations in ss 56 and 57 required by s 58(2)(a) and bringing to bear
such of the matters set out in s 58(2)(b) as the Tribunal thinks appropriate.
[47] My reasons should not be taken as undermining, in the slightest, the authority and rigour
ss 56–​61 give to judicial officers in the just, quick and cheap disposal of controversies. This will often
require the hacking away of a morass of technicalities and excuses for delays often put forward by less
than diligent litigants. That said, the terms of s 58 (and the consequential importance of s 57, as well
as s 56) should be borne in mind when exercising these case management powers.
[48] The orders I propose are:
(a)
leave to appeal granted;
(b)
the appellant to file a Notice of Appeal within 7 days;
(c)
appeal dismissed;
(d)
appellant to pay the respondent’s costs.

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Halpin v Lumley General Insurance
[2.230] Halpin v Lumley General Insurance Ltd (2009) 78 NSWLR 265; [2009] NSWCA 372
BASTEN JA
[3]‌The proceedings arose out of the refusal by the respondent to pay an insurance claim made by
the applicants. The refusal was in part based upon concerns that the applicants had been untruthful
in the making of the claim. The respondent, in investigating the claims, obtained certain materials and
information with respect to which they sought to maintain confidentiality, until they were deployed
in the course of the proceedings and, no doubt, initially in the cross-​examination of the applicants.
Hoeben J directed that the respondent not be required to serve certain affidavits: Halpin v Lumley
General Insurance Ltd (2009) 258 ALR 588; [2009] NSWSC 644.
[5]‌ … [T]he applicants … contended that such a power no longer existed because it pre-​dated
procedural changes which were expressly designed to overcome those characteristics of civil litigation
which rendered it liable to be “trial by ambush”.
[6]‌ … [T]he applicants submitted that there was no authority to support the proposition that
material could be excluded from pre-​trial disclosure where it necessarily formed evidence upon which
a defendant would seek to rely in support of a pleaded defence. The fact that the material might also
be used in cross-​examination of the plaintiffs, or their witnesses, did not justify maintaining pre-​trial
confidentiality.
[24] Sections 56, 57 and 58(1) and (2)(a) have an appearance of clarity and rigour, based on
simplicity and repetition. As the Court (Allsop P, Campbell and Young JJA agreeing) noted in Hans Pet
Constructions Pty Ltd v Cassar [2009] NSWCA 230 at [38] both ss 56 and 57 are “statutorily compulsory”
considerations. A court will act erroneously in law if it fails to take them into account. Furthermore, as
explained by the Court in Commissioner of Police (NSW) v Industrial Relations Commission (NSW) [2009]
NSWCA 198 at [73] (Spigelman CJ, Macfarlan and Young JJA agreeing):
A statutory requirement to “have regard to” a specific matter, requires the Court to give the
matter weight as a fundamental element in the decision-​making process. (R v Hunt; Ex parte
Sean Investments Pty Ltd (1979) 180 CLR 322 at 329; R v Toohey; Ex parte Meneling Station
Pty Ltd (1982) 158 CLR 327 at 333 and 337–​338; Zhang v Canterbury City Council [2001]
NSWCA 167; (2001) 51 NSWLR 589 at [71]–​[73]). An equivalent formulation is that the
matter so identified must be the focal point of the decision-​making process. (See Evans v
Marmont (1997) 42 NSWLR 70 at 79–​80; Zhang supra at [73].)
[25] It may be remarked by way of exegesis that a statutory requirement to “have regard to” a
particular matter will obtain its force and effect from its context. The particular matter will become a
fundamental element or focal point where it is the only matter, or one of a small number of identified
matters, to be taken into account. Thus, in R v Toohey; ex parte Meneling Station [1982] HCA 69; 158
CLR 327, a matter, namely the “strength or otherwise of the traditional attachment by the claimants
to the land claimed” was the sole matter to which the Commissioner was obliged to “have regard”,
four other matters being identified as matters for comment, at 336 and 338 (Mason J). Similarly, in
R v Hunt; Ex parte Sean Investments Pty Ltd [1979] HCA 32; 180 CLR 322 at 329, Mason J explained in
relation to the operation of s 40AA(7) of the National Health Act 1953 (Cth), dealing with the fixing of
fees charged for nursing home care:
When subs (7) directs the Permanent Head to “have regard to” the costs, it requires him to
take those costs into account and to give weight to them as a fundamental element in making
his determination. There are two reasons for saying that the costs are a fundamental element
in the making of the determination. First, they are the only matter explicitly mentioned as
a matter to be taken into account. Secondly, the scheme of the provisions is that, once the
premises of the proprietor are approved as a nursing home, he is bound by the conditions
of approval not to exceed the scale of fees fixed by the Permanent Head in relation to the
nursing home. In many cases it is to be expected that the scale of fees will be fixed by
[2.230]
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Halpin v Lumley General Insurance cont.
ascertaining the costs necessarily incurred and adding to them a profit factor. In the very
nature of things, the costs necessarily incurred by the proprietor in providing nursing home
care in the nursing home are a fundamental matter for consideration.
However, the sub-​section does not direct the Permanent Head to fix the scale of fees
exclusively by reference to costs necessarily incurred and profit.
[26] Similarly, the point made by Gleeson CJ and McClelland CJ in Eq in Evans v Marmont (1997) 42
NSWLR 70 was that a particular provision of the De Facto Relationships Act 1984 (NSW) permitting
the Court to adjust interest with respect to property of the de facto partners, identified two factors
which were “not merely two matters, or groups of matters, which take their place amongst any other
relevant considerations”: at 79–​80; applied in Zhang v Canterbury City Council [2001] NSWCA 167;
51 NSWLR 589 at [73].
[27] Those principles have a clear operation in relation to s 57(1) which identify four specific
objects to which regard shall be had. How such a mandatory obligation operates in relation to s 56
is less clear.
[28] Section 56 purports to identify a single “overriding purpose”, namely to facilitate “the just,
quick and cheap resolution of the real issues in” civil proceedings. It is self-​evident that what will be
required in most cases is the resolution of a tension between speed (including avoidance of delay),
reduction of costs and the proper consideration of the issues raised by the parties, especially in cases of
complexity. Other provisions which appear to be intended to have a similar effect are more explicit in
their recognition of the need to resolve such tensions: see, eg, Supreme Court (General Civil Procedure)
Rules 2005 (Vic), r 1.14; Uniform Civil Procedure Rules 1999 (Qld), r 5; Administrative Appeals Tribunals
Act 1975 (Cth), s 2A; Access to Justice (Civil Litigation Reforms) Amendment Bill 2009 (Cth), cl 37M(3).
In the explanatory memorandum accompanying the Commonwealth Bill, it is noted at para 21:
The overarching purpose is not intended to prevent the exercise of judicial discretion in
managing particular cases. In the NSW Civil Procedure Act 2005, s 56 uses the term “overriding
purpose”. An “overriding purpose” would trump any other inconsistent purpose. For
example, if a party required a certain number of witnesses or a certain number of hearing
days, but this was inconsistent with the just, quick, and cheap resolution of the real issue in
the proceedings, the Court would be required to give effect to the purpose, as it is overriding.
[29] This remark appears to take a different view of the effect of s 56 to that suggested above. The
purpose of the Act and rules, and the purpose to which the Court is required to give effect in the
exercise of a power given by the rules, is to facilitate an outcome which fulfils, by an appropriate
resolution of conflicting tensions, the attributes of being just, quick and cheap. The real question is
how should the Court go about this exercise?
[30] In part, the answer to that question must be found in s 57. The changes which are brought
to pass by these provisions, taken in tandem, are primarily two-​fold. The first change from traditional
practice is that the Court is required to have regard to questions of cost and delay, and not merely
the resolution of the issues in the manner and at a time sought by one or other party. As explained
by the High Court in the context of the exercise of the power of amendment, a party seeking an
indulgence cannot assume that an offer to pay the costs incurred will necessarily be sufficient either
to overcome the potential prejudice to the other party, or to entitle it to a favourable exercise of a
power of amendment: see Aon Risk Services Australia Ltd v Australian National University [2009] HCA
27; 83 ALJR 951 at [25] (French CJ) and [98] (Gummow, Hayne, Crennan, Kiefel and Bell JJ). Secondly,
the Court is not only entitled but required now to take into account the effect of any exercise of
power on the efficient disposal of the business of the Court and the use of available judicial and
administrative resources in other proceedings. To give effect to that object, it is clear that the parties
cannot determine the management of their own cases in their own way and at their own speed. The
Court is entitled, and in appropriate cases obliged, to interfere and give directions to ensure that the
broader objects of case management within the Court are effected.
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SACKVILLE AJA
[93] The application of the criteria laid down by ss 56–​58 is not without difficulty. There is, or at
least may be, a tension between the just resolution of the real issues in proceedings and the quick and
cheap resolution of those issues. A reasonable opportunity to lead evidence, cross-​examine witnesses
and present a case (cf CP Act, s 62(4)), depending on the nature of the claim, may be very difficult to
achieve quickly and cheaply. Similarly, the “just determination of the proceedings” (s 57(1)(a)) may
detract from “the efficient use of available judicial … resources” (s 57(1)(c)), if the latter expression
means minimising the judicial resources required to resolve a given number of cases. To some extent
the tension is ameliorated by the concept of proportionality, introduced by ss 57(1)(d) and 60 of the
CP Act. Nonetheless, the exercise of powers in conformity with the “overriding purpose” is likely to
involve some balancing of competing objectives.
[94] The CP Act does not expressly accord paramountcy to the just determination of the
proceedings, although this is the first object stated in s 57(1) of the CP Act. In contrast, for example,
the rule considered by the High Court in Aon Risk Services (Court Procedures Rules 2006 (ACT), r 21(1))
states that the purpose of the Rules is:
to facilitate the just resolution of the real issues in civil proceedings with minimum delay and
expense.
Similarly, the Civil Procedure Rules 1998 (UK), made under the Civil Procedure Act 1997 (UK), state
(r 1.1(1)) that the:
Rules are a new procedural code with the overriding objective of enabling the court to deal
with cases justly.
The expression “deal with cases justly” includes, so far as practicable, the following considerations
(r 1.1(2)):
(a)
ensuring that the parties are on an equal footing;
(b)
saving expense;
(c)
dealing with the case in ways which are proportionate –​
(i)
to the amount of money involved;
(ii)
to the importance of the case;
(iii)
to the complexity of the issues; and
(iv)
to the financial position of each party;
(d)
ensuring that it is dealt with expeditiously and fairly; and
(e)
allotting to it an appropriate share of the court’s resources, while taking into account the need
to allot resources to other cases.
[95] Whatever difficulties there may be in reconciling the objectives embodied in the overriding
purpose stated in s 56(1) of the CP Act, it is clear that the court has wide powers to make directions
for the conduct of proceedings, including the directions relating to the disclosure or withholding of
affidavits or reports on which a party intends to rely at a hearing. It is necessary, in the exercise of
such powers for the court to take into account the mandatory considerations identified in the CP Act
and the UCPR. Those considerations may suggest the exercise of caution before one party is given an
apparent forensic advantage by being partially exempted from a requirement to exchange affidavits
and reports prior to the trial. But it is impossible to say, irrespective of the justice of the particular case
or the issues at stake, that the court’s powers can never be wide enough to make orders of the kind
made in the present case.
[96] Specifically, if the court considers that an order permitting one party to withhold affidavit or
other material from the other party pending the trial is likely to assist in the speedy determination of
the real issues between the parties (CP Act, s 61(1)) or is likely to advance the just, quick and cheap
[2.230]
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disposal of the proceedings (UCPR, r 2.1), it has power to make the order. Whether the order is
appropriate in a particular case will depend on a number of considerations, including the application
to the circumstances of the case of the criteria stated in CP Act, s 57(1) and the “dictates of justice”
as defined in s 58(2).
Policy Issues and Exercise of the Power
[97] The policy reasons identified by Mr Pritchard in his submissions are likely to be relevant to the
exercise of the powers conferred by the CP Act or the UCPR, where one party seeks an order of
the kind made in the present case. The first of the matters identified by Mr Pritchard, the risk of an
adjournment of the trial, would ordinarily be a matter relevant to the “overriding purpose” stated
in s 56(1) of the CP Act. The risk of an adjournment, if realised, might diminish the likelihood of a
“quick and cheap resolution of the real issues”. The risk might also be thought, depending on the
circumstances, to jeopardise the efficient disposal of the business of the court and the efficient use of
available judicial resources (ss 57(1)(b), (c), 58).
[98] The second matter identified by Mr Pritchard, namely fairness to the party denied access to
the material until after the trial has commenced, clearly must be taken into account before an order
is made. Fairness to a party is, at the very least, important to the just resolution or determination of
the proceedings (CP Act, ss 57(1)(a), 58(1); see too, s 58(2)(b)(v)). The likely impact of the order
upon prospects for settlement (the third policy issue identified by Mr Pritchard) is likely to be relevant
to the efficient use of available judicial resources and to the timely disposal of the proceedings
(s 57(1)(b), (d)).
[99] It is, however, one thing to say that these “policy” considerations may have to be taken into
account in determining whether a power conferred by the CP Act or the UCPR should be exercised in
a particular case. It is another to suggest that they lead to the conclusion that the court lacks power,
regardless of the circumstances, to make directions authorising one party to withhold affidavits or
reports from the other party until after the trial has commenced. There is nothing in the language of
the relevant provisions of the CP Act or the UCPR that supports any such conclusion.
[100] Mr Pritchard referred to authorities which emphasise the need for “clarity, precision and
openness in the conduct of litigation” and the importance of a “cards on the table approach”
which leads to the delineation and illumination of the real issues in dispute: Baulderstone Hornibrook
Engineering Pty Ltd v Gordian Runoff Ltd [2008] NSWCA 243, at [160]–​[162], per Allsop P (with whom
Beazley and Campbell JJA agreed); Nowlan v Marson Transport Pty Ltd [2001] NSWCA 346; 53 NSWLR
116, at [26]–​[31] per Heydon JA (with whom Mason P and Young CJ in Eq agreed) (rejecting the
“ambush theory of litigation” and endorsing the observations of Allsop J in White v Overland [2001]
FCA 1333, at [4]‌:
[I]‌n the efficient and proper conduct of civil litigation, even civil litigation hard fought
between parties, it should always be recognised that in the propounding of issues for trial
the parties should take steps to ensure that all relevant parties to the dispute are cognisant
of what the issues are.
[101] There is no inconsistency between these statements of principle and the existence of a power,
exercisable for good cause in appropriate circumstances, to direct that a party may withhold affidavits
until trial. The making of such a direction does not imply that the trial is to be conducted “by ambush”,
nor that the party seeking the direction has failed to co-​operate in identifying and elucidating the
issues in dispute. On the contrary, the statutory criteria that must be taken into account for a direction
to be made should ensure that the issues are clearly defined and that the party seeking the directions
demonstrates that the “dictates of justice” will be served by the direction. …
Conclusion on Power
[107] For these reasons I conclude that courts in New South Wales have power under the CP Act
and the UCPR to make orders relieving one party to civil litigation from complying, in whole or in
part, with directions that would otherwise require that party to disclose to the other in advance of
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the trial all affidavits and reports to be adduced in evidence at the trial. The sources of such a power
include, (although they are not necessarily limited to) CP Act, s 61(1), (2)(c) and UCPR, rr 2.1, 2.3.
In exercising the power, a court is required to take into account the overriding purpose of the CP Act
and the UCPR stated in s 56(1) of the CP Act and the objects identified in s 57(1). It is also necessary
to take into account, insofar as relevant, the object of minimising delay, within the limitations outlined
in s 59 of the CP Act and the principle of proportionality embodied in s 60. The court may also have
regard to the matters specified in s 58(2), to the extent it considers those matters relevant. As I have
explained, a decision in a particular case is likely to require a weighing of considerations that will not
always be easy to reconcile.

McGuirk v University of New South Wales
[2.240] McGuirk v University of New South Wales [2010] NSWCA 104
SACKVILLE AJA
[162] … The width of the power conferred by r 2.1 is striking. The court is given power at any
time to give such directions and to make such orders for the conduct of any proceedings, whether or
inconsistent with the rules of court, for the just, quick and cheap disposal of the proceedings. Rule 2.1
differs from s 61(1) in two important respects:
• the power is not confined to making directions for the speedy determination of the real issues in
the proceedings, but includes a power to make directions or orders as appear convenient for the
just, cheap and quick disposal of the proceedings; and
• the power is to give directions or orders “for the conduct of any proceedings”.

Aon Risk Services Australia v ANU
[2.250] Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175;
[2009] HCA 27
[ANU commenced proceedings in the Supreme Court of the Australian Capital Territory against
three insurers, claiming an indemnity for losses it had suffered by reason of the destruction or damage
to buildings at its Mount Stromlo Complex by fire in January 2003. Aon was the ANU’s insurance
broker. On the third day of a four-​week trial of the action, ANU reached a settlement with the insurers.
ANU sought an adjournment of the trial of its claim against Aon and foreshadowed an application for
leave to amend that claim to add a new claim against Aon.]
GUMMOW, HAYNE, CRENNAN, KIEFEL and BELL JJ
[60] Rule 21 states the purposes of the Rules in Ch 2 and requires that they be applied to those
ends. The Rule is in these terms:
(1)
The purpose of this chapter, and the other provisions of these rules in their application to
civil proceedings, is to facilitate the just resolution of the real issues in civil proceedings with
minimum delay and expense.
(2)
Accordingly, these rules are to be applied by the courts in civil proceedings with the objective
of achieving –​
(a)
the just resolution of the real issues in the proceedings; and
[2.250]
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(b)
the timely disposal of the proceedings, and all other proceedings in the court, at a cost
affordable by the respective parties.
(3)
The parties to a civil proceeding must help the court to achieve the objectives.
(4)
The court may impose appropriate sanctions if a party does not comply with these rules or an
order of the court.
…
[92] The purposes stated in r 21 reflect principles of case management by the courts. Such
management is now an accepted aspect of the system of civil justice administered by courts in Australia.
It was recognised some time ago, by courts here and elsewhere in the common law world, that a
different approach was required to tackle the problems of delay and cost in the litigation process. In
its report in 2000, Managing Justice: A review of the federal civil justice system, the Australian Law
Reform Commission noted that: “Over the last ten years Australian courts have become more active
in monitoring and managing the conduct and progress of cases before them, from the time a matter
is lodged to finalisation”.
[93] Rule 21(2)(b) indicates that the rules concerning civil litigation no longer are to be considered
as directed only to the resolution of the dispute between the parties to a proceeding. The achievement
of a just but timely and cost-​effective resolution of a dispute has an effect upon the court and upon
other litigants. In Sali v SPC Ltd Toohey and Gaudron JJ explained that case management reflected:
[t]‌he view that the conduct of litigation is not merely a matter for the parties but is also
one for the court and the need to avoid disruptions in the court’s lists with consequent
inconvenience to the court and prejudice to the interests of other litigants waiting to be
heard …
[94] It will be recalled that in JL Holdings the plurality said that nothing in Sali v SPC suggested
that principles of case management might be employed “except perhaps in extreme circumstances,
to shut a party out from litigating an issue which is fairly arguable”. Their Honours said that case
management was not to be seen as an end to itself and that the ultimate aim of the court remained
the attainment of justice, even in changing times. In Gale v Superdrug Stores Plc Millett LJ expressed
a similar concern, regarding the need to ensure that justice is not sacrificed. Waller LJ, delivering the
judgment of the Court of Appeal in Worldwide Corporation Ltd v GPT Ltd, said that such a concern did
not pay sufficient regard to the fact that the courts are concerned to do justice to all litigants. Where
a party had had a sufficient opportunity to plead his or her case, it may be necessary for the court to
make a decision which may produce a sense of injustice in that party, for the sake of doing justice to
the opponent and to other litigants.
[95] The statement of Waller LJ identifies a fundamental premise of case management. What may
be just, when amendment is sought, requires account to be taken of other litigants, not just the
parties to the proceedings in question. The statement is consistent with what was said in Sali v SPC,
which reflected a proper understanding of case management. The statements in JL Holdings do not
reflect such an understanding and are not consistent with what was said in Sali v SPC. To say that case
management principles should only be applied “in extreme circumstances” to refuse an amendment
implies that considerations such as delay and costs can never be as important as the raising of an
arguable case; and it denies the wider effects of delay upon others.
[96] An important aspect of the approach taken by the plurality in JL Holdings was that it proceeded
upon an assumption that a party should be permitted to amend to raise an arguable issue subject to
the payment of costs occasioned by the amendment. So stated it suggests that a party has something
approaching a right to an amendment. That is not the case. The “right” spoken of in Cropper v
Smith needs to be understood in the context of that case and the Rule, which required amendment
to permit the determination of a matter already in issue. It is more accurate to say that parties have
the right to invoke the jurisdiction and the powers of the court in order to seek a resolution of their
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dispute. Subject to any rights to amend without leave given to the parties by the rules of court,
the question of further amendment of a party’s claim is dependent upon the exercise of the court’s
discretionary power.
[97] The objectives of case management are now expressly stated in r 21 of the Court Procedures
Rules. It cannot be overlooked that later rules, such as r 21, are likely to have been written with the
decision in JL Holdings in mind. The purposes stated in r 21 cannot be ignored. The Court Procedures
Rules make plain that the Rules are to be applied having regard to the stated objectives of the timely
disposal of the proceedings at an affordable cost. There can be no doubt about the importance of
those matters in litigation in the courts of the Australian Capital Territory.
[98] Of course, a just resolution of proceedings remains the paramount purpose of r 21; but what
is a “just resolution” is to be understood in light of the purposes and objectives stated. Speed and
efficiency, in the sense of minimum delay and expense, are seen as essential to a just resolution of
proceedings. This should not detract from a proper opportunity being given to the parties to plead
their case, but it suggests that limits may be placed upon re-​pleading, when delay and cost are taken
into account. The Rule’s reference to the need to minimise costs implies that an order for costs may
not always provide sufficient compensation and therefore achieve a just resolution. It cannot therefore
be said that a just resolution requires that a party be permitted to raise any arguable case at any point
in the proceedings, on payment of costs.
[99] In the past it has more readily been assumed that an order for the costs occasioned by
the amendment would overcome injustice to the amending party’s opponent. In Cropper v Smith
Bowen LJ described an order for costs as a panacea that heals all. Such a view may largely explain the
decision of this court in Shannon v Lee Chun, which upheld a decision allowing the plaintiff to raise a
new case at the second trial, but which imposed a condition as to costs. The modern view is that even
an order for indemnity costs may not always undo the prejudice a party suffers by late amendment.
In the present case it is difficult to see that such an order could be sufficient compensation, given that
Aon would be required to again defend litigation which was, effectively, to be commenced afresh.
[100] The views expressed by Lord Griffiths in Ketteman v Hansel Properties Ltd, that justice cannot
always be measured in money and that a judge is entitled to weigh in the balance the strain the
litigation imposes upon litigants, are also now generally accepted. In Bomanite Pty Ltd v Slatex Corp
Aust French J said of Bowen LJ’s statements in Cropper v Smith:
That may well have been so at one time, but it is no longer true today … Non-​compensable
inconvenience and stress on individuals are significant elements of modern litigation. Costs
recoverable even on an indemnity basis will not compensate for time lost and duplication
incurred where litigation is delayed or corrective orders necessary.
[101] In Ketteman Lord Griffiths recognised, as did the plurality in JL Holdings, that personal litigants
are likely to feel the strain more than business corporations or commercial persons. So much may be
accepted. But it should not be thought that corporations are not subject to pressures imposed by
litigation. A corporation in the position of a defendant may be required to carry a contingent liability
in its books of account for some years, with consequent effects upon its ability to plan financially,
depending upon the magnitude of the claim. Its resources may be diverted to deal with the litigation.
And, whilst corporations have no feelings, their employees and officers who may be crucial witnesses,
have to bear the strain of impending litigation and the disappointment when it is not brought to an
end. The stated object in the Court Procedures Rules, of minimising delay, may be taken to recognise
the ill-​effects of delay upon the parties to proceedings and that such effects will extend to other
litigants who are also seeking a resolution in their proceedings.
[102] The objectives stated in r 21 do not require that every application for amendment should
be refused because it involves the waste of some costs and some degree of delay, as it inevitably
will. Factors such as the nature and importance of the amendment to the party applying cannot be
overlooked. Whilst r 21 assumes some ill-​effects will flow from the fact of a delay, that will not prevent
[2.250]
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the parties dealing with its particular effects in their case in more detail. It is the extent of the delay
and the costs associated with it, together with the prejudice which might reasonably be assumed to
follow and that which is shown, which are to be weighed against the grant of permission to a party
to alter its case. Much may depend upon the point the litigation has reached relative to a trial when
the application to amend is made. There may be cases where it may properly be concluded that a
party has had sufficient opportunity to plead their case and that it is too late for a further amendment,
having regard to the other party and other litigants awaiting trial dates. Rule 21 makes it plain that
the extent and the effect of delay and costs are to be regarded as important considerations in the
exercise of the court’s discretion. Invariably the exercise of that discretion will require an explanation
to be given where there is delay in applying for amendment.
[103] The fact that an explanation had been offered for the delay in raising the defence was
regarded as a relevant consideration in JL Holdings. Generally speaking, where a discretion is sought to
be exercised in favour of one party, and to the disadvantage of another, an explanation will be called
for. The importance attached by r 21 to the factor of delay will require that, in most cases where it is
present, a party should explain it. Not only will they need to show that their application is brought
in good faith, but they will also need to bring the circumstances giving rise to the amendment to the
court’s attention, so that they may be weighed against the effects of any delay and the objectives of
the Rules. There can be no doubt that an explanation was required in this case.

Expense Reduction Analysts Group v Armstrong Strategic
Management and Marketing
[2.255] Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing
Pty Ltd (2013) 250 CLR 303; [2013] HCA 46
[The interlocutory dispute before the High Court dealt with documents inadvertently provided
by some of the defendants (ERA parties) to the plaintiffs (Armstrong parties) as part of discovery that
were subject to client legal privilege. The solicitors for Armstrong reviewed the disclosed documents
and came across 13 documents that appeared to be subject to client legal privilege (the “Privileged
Documents”). Armstrong’s solicitors sent a letter to ERA’s solicitors seeking clarification as to the
Privileged Documents. ERA’s solicitors then wrote to Armstrong’s solicitors stating that due to an
“inadvertence on the part of one of the reviewers [the Privileged Documents] were not marked as
privileged” and sought the return of the Privileged Documents. Armstrong’s solicitors declined to
return the Privileged Documents and claimed that whatever privilege the documents might have
held had been waived upon disclosure. ERA sought an injunction to refrain Armstrong from using the
Privileged Documents. In the courts below, the issue had been dealt with based on waiver of privilege
and protection of confidential information. The High Court dealt with the issue by reference to the
overriding purpose and the court’s power to give directions.]
THE COURT
[7]‌Proceedings of this kind and length concerning a tangential issue should have been averted.
There was no need to resort to an action in the equitable jurisdiction of the Supreme Court to obtain
relief. That Court has all the powers necessary to deal with an issue relating to discovery and which
required, essentially, that a party be permitted to correct a mistake. Those powers exist by virtue of the
Court’s role in the supervision of the process of discovery and the express powers given by Pt 6 of the
CPA to ensure the “just, quick and cheap resolution of the real issues in the dispute or proceedings.”11
11
The version of s 56 that the High Court addressed was subsequently amended by the Courts and Other
Legislation Further Amendment Act 2013 (NSW), which deleted the words “dispute or”.
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Those powers should have been exercised in relation to each of the 13 privileged documents for the
reasons which follow.
…
The approach required by the CPA
[51] In Aon Risk Services Australia Ltd v Australian National University [(2009) 239 CLR 175 at 211 [92]-​
[93], 213 [98]], it was pointed out that case management is an accepted aspect of the system of civil
justice administered by the courts in Australia. It had been recognised some time ago by courts in the
common law world that a different approach was required to tackle the problems of delay and cost in
the litigation process. Speed and efficiency, in the sense of minimum delay and expense, are essential
to a just resolution of proceedings. The achievement of a just but timely and cost-​effective resolution
of a dispute has effects not only upon the parties to the dispute but upon the court and other litigants.
The decision in Aon Risk Services Australia Ltd v Australian National University was concerned with
the Court Procedures Rules 2006 (ACT) as they applied to amendments to pleadings. However, the
decision confirmed as correct an approach to interlocutory proceedings which has regard to the wider
objects of the administration of justice.
[52] Unsurprisingly, the case management rules with which the Court was concerned in Aon Risk
Services Australia Ltd v Australian National University had essentially the same object as those stated in
the CPA. … [The Court set out CPA ss 56-​59.]
[55] … The CPA provides some broad powers to the court to enable it to fulfil its duties with respect
to the management of proceedings. Sections 56 to 59 appear in Pt 6 of Div 1 (“Guiding principles”)
of the CPA. Division 2 of Pt 6 is entitled “Powers of court to give directions”. Section 61(1) provides
generally that:
The court may, by order, give such directions as it thinks fit (whether or not inconsistent
with rules of court) for the speedy determination of the real issues between the parties to
the proceedings.
Sub-​section (2) goes on to provide that the court may, inter alia, direct the parties to take specified
steps and give such other directions with respect to the conduct of the proceedings as it considers
appropriate.
[56] The evident intention and the expectation of the CPA is that the court use these broad powers
to facilitate the overriding purpose. Parties continue to have the right to bring, pursue and defend
proceedings in the court, but the conduct of those proceedings is firmly in the hands of the court.
It is the duty of the parties and their lawyers to assist the court in furthering the overriding purpose.
[57] That purpose may require a more robust and proactive approach on the part of the courts.
Unduly technical and costly disputes about non-​essential issues are clearly to be avoided. However, the
powers of the court are not at large and are not to be exercised according to a judge’s individualistic
idea of what is fair in a given circumstance. Rather, the dictates of justice referred to in s 58 require
that in determining what directions or orders to make in the conduct of the proceedings, regard is
to be had in the first place to how the overriding purpose of the CPA can be furthered, together with
other relevant matters, including those referred to in s 58(2). The focus is upon facilitating a just, quick
and cheap resolution of the real issues in the proceedings, although not at all costs. The terms of the
CPA assume that its purpose, to a large extent, will coincide with the dictates of justice.
The orders which should have been made
[58] In addition to the general powers it gives to courts, the CPA also provides some more specific
powers. The relevant power here is to be found in s 64 of the CPA, entitled “Amendment of documents
generally”, which appears in Div 3 of Pt 6 (“Other powers of court”). Section 64(1)(a) empowers the
court, at any stage in the proceedings, to order that any document in the proceedings be amended.
Section 64(2) then provides that, subject to s 58 (the dictates of justice):
[2.255]
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all necessary amendments are to be made for the purpose of determining the real questions
… correcting any defect or error in the proceedings and avoiding multiplicity of proceedings.
The direction which the Supreme Court should promptly have made in this case was to permit Norton
Rose to amend the Lists of Documents, together with consequential orders for the return of the disks
to enable the privileged documents to be deleted. Such a direction and orders would have obviated
the need to resort to the more complex questions concerning the grant of relief in the equitable
jurisdiction. It would have served to defuse the dispute and dissuaded the Armstrong parties from
alleging waiver. It accords with the overriding purpose and the dictates of justice.
[59] It could hardly be suggested that the pursuit of satellite interlocutory proceedings of the
kind here in question in any way fulfils the overriding purpose of the CPA. To the contrary, it is the
very kind of conduct which should be avoided if those purposes are to be achieved. It involved a
relatively minor issue relating to discovery, the resolution of which appears to have offered little
advantage to the Armstrong parties. Its determination went no way towards the resolution of the
real issues in dispute between the parties. Instead, it has distracted them from taking steps to a
final hearing, encouraged the outlay of considerable expense and squandered the resources of
the Court.
…
Solicitors’ responsibilities
[64] The question for a party to civil proceedings and its legal representatives is not just whether
there is any real benefit to be gained from creating a dispute about whether a mistake in the
course of discovery should be corrected. The CPA imposes a positive duty upon a party and its legal
representatives to facilitate the CPA’s purposes. Requiring a court to rule upon waiver and the grant
of injunctive relief in circumstances such as the present could not be regarded as consistent with
that duty.

[2.258] The High Court has continued to require adherence to the principles of case
management established in Aon Risk and Expense Reduction Analysts in subsequent
judgments in UBS AG v Tyne [2018] HCA 45 and Rozenbilt v Vainer (2018) 262 CLR 478;
[2018] HCA 23.
Tugrul v Tarrants Financial Consultants
[2.260] Tugrul v Tarrants Financial Consultants Pty Ltd [No 5] [2014] NSWSC 437
KUNC J
[An Amended Notice of Motion filed by the Third Defendant (Ms Seco) for security for costs was
dismissed by Kunc J. The application was filed without Ms Seco’s solicitor first corresponding with the
Plaintiffs’ solicitors concerning the Plaintiffs’ ability to meet any order for costs made against them.
The application was subsequently not pressed against the plaintiffs that were natural persons. The
principles governing security for costs are discussed in Chapter 3.]
[63] There was no reason for the peremptory filing of Ms Seco’s application. To have done so was
a departure from proper practice. That conduct, and the fact that this is my fifth (and, hopefully, final)
judgment in the management and disposition of interlocutory applications in these proceedings over
several months, calls for reflection on how parties and their lawyers should approach interlocutory
matters in the course of proceedings in this Court. I should also record that one party to these
proceedings has informed the Court that the financial burden of the interlocutory hearings thus far
has meant that he can no longer afford legal representation.
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[64] Having regard to s 56 of the CP Act, parties to proceedings in this Court and their lawyers
are required to engage in prompt, courteous and genuine cooperation (including the provision of
reasonably required information or explanations) with the firm intention of resolving interlocutory
issues, as far as possible, without involving the processes of the Court. If complete resolution is not
possible, then the parties’ conduct should at least ensure that only those issues that are really in
dispute are submitted for adjudication. “Unduly technical and costly disputes about non-​essential
issues are clearly to be avoided”: Expense Reduction and Analysts Group Pty Ltd v Armstrong Strategic
Management and Marketing Pty Ltd [2013] HCA 46; (2013) 303 ALR 199; (2013) 88 ALJR 76 (“Expense
Reduction”) at [57] per the Court. The approach I have identified should be followed in all cases
except where there is a real basis for the urgent filing of a motion.
…
[66] Also relevant is s 59 of the CP Act, which applies with equal force to the parties and the Court:
In any proceedings, the practice and procedure of the court should be implemented with
the object of eliminating any lapse of time between the commencement of the proceedings
and their final determination beyond that reasonably required for the interlocutory activities
necessary for the fair and just determination of the issues in dispute between the parties and
the preparation of the case for trial.
[67] Section 56 of the CP Act was considered by the High Court in Expense Reduction. These
observations by the Court are especially pertinent (emphases added and citations omitted):
Solicitors’ responsibilities
64. The question for a party to civil proceedings and its legal representatives is not just
whether there is any real benefit to be gained from creating a dispute about whether a
mistake in the course of discovery should be corrected. The CPA imposes a positive duty
upon a party and its legal representatives to facilitate the CPA’s purposes. Requiring a court to
rule upon waiver and the grant of injunctive relief in circumstances such as the present could not
be regarded as consistent with that duty.
65. The position of solicitors who are in receipt of privileged documents has another
dimension. Rule 31 of the Australian Solicitors’ Conduct Rules, which were adopted by the
Law Council of Australia, deals with the duty of a solicitor to return material, which is known
or reasonably suspected to be confidential, where a solicitor is aware that its disclosure was
inadvertent. It involves notifying the other solicitor of the disclosures and returning that
material. The rule has been adopted in Queensland and South Australia and the Law Society
of New South Wales presently proposes to adopt it.
66. Such a rule should not be necessary. In the not too distant past it was understood that
acting in this way obviates unnecessary and costly interlocutory applications. It permits a prompt
return to the status quo and thereby avoids complications which may arise in the making of
orders for the rectification of the mistake and the return of documents.
67. This approach is important in a number of respects. One effect is that it promotes conduct
which will assist the court to facilitate the overriding purposes of the CPA. It is an example of
professional, ethical obligations of legal practitioners supporting the objectives of the proper
administration of justice.
[68] How do these dicta and the requirements of ss 56 and 59 of the CP Act translate into practice
when interlocutory issues arise, including such matters as amendments, strike outs, discovery and
security for costs? Assuming compliance by the practitioner with the relevant professional conduct
rules, nine points may be made by way of general, practical guidance. Nevertheless, the variety of
circumstances confronted in practice means that what follows cannot be exhaustive.
[69] First, it must be emphasised that s 56 of the CP Act and its related provisions are not just pious
exhortations to be acknowledged and then ignored. They have real consequences for the clients and
lawyers in this Court and are to be applied rigorously in the conduct of all litigation, great or small.
[2.260]
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[70] Second, solicitors and barristers are members of a profession. It is of the essence of a profession
that relations between its members are characterised by civility, trust and mutual respect. The Court
sees far too much correspondence between lawyers that bears none of those qualities. They must
never be abandoned at the behest of clients or in the misguided belief that that is what successful
representation of a client requires.
[71] Third, many interlocutory issues can be solved or at least better understood by a simple
telephone call. It has been suggested that some lawyers no longer speak to their opponents on
the telephone for fear of being “verballed” in an affidavit. If that is true, then it is a retrograde
development which the CP Act gives legislative authority to the profession to reverse.
[72] Fourth, if one party requires information or an explanation from another, then the request
should be reasonable and focused. A clear justification for the request should be given.
[73] Fifth, faced with a reasonable request, the recipient should not automatically respond with an
unthinking denial of legal entitlement to the information. The obligation to facilitate the overriding
purpose will sometimes require information or an explanation to be given to which the party may
not be “legally” entitled. Furthermore, if it is information which would be required to be produced
in response to a subpoena or notice to produce then it is contrary to the s 56 obligations of a party
and that party’s lawyers to resist providing it unless and until the Court’s process is invoked. If there
is concern for the confidence of such material then an undertaking of the kind considered in Hearne
v Street [2008] HCA 36; (2008) 235 CLR 125 (which would apply if the information were provided
under compulsion) should be sought and given.
[74] Sixth, the filing of a motion should be regarded as a last resort. It will inevitably add to costs,
and delay the progress of the matter to hearing.
[75] Seventh, no motion should be filed without the putative respondent being given final,
written notice of the relief to be sought, the reason for it and a reasonable opportunity to respond.
The Court sees far too many examples of deadlines of a day or less being set in correspondence. My
own view, as a rule of thumb, is that three clear business days is reasonable to allow for a response
on any matter of substance. If the recipient requires more time to obtain instructions, then they
should send a prompt request with an explanation to that effect and an indication of when a proper
reply will be provided. In relation to challenges to pleadings it was once the practice for opposing
counsel to confer before a strike out motion was filed. To the extent that practice has been lost, it
should resurrected.
[76] Eighth, once a motion is filed, the parties are obliged to ensure that only the real or essential
issues are litigated. This calls for discrimination in both the preparation of evidence and argument.
As to the former, real thought must be given to the precise evidence required. The practice of
exhibiting “everything” or “the file” to provide an evidentiary cornucopia from which only a few
morsels are ultimately selected to be referred to in argument is completely unacceptable. Where it
becomes apparent that an application or argument is unsustainable, it should be abandoned, and
that abandonment notified to the other parties, at the earliest opportunity.
[77] Ninth, where delay or unnecessary expense has been caused by conduct which is contrary
to the obligations of parties and their lawyers under s 56 and its related provisions, parties and
lawyers should not be in any doubt that in appropriate cases the Court will exercise its power in
relation to costs (see s 56(5) of the CP Act) to provide some measure of justice in response to such
conduct.

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Principle of a Fair Trial in the Australian Civil Justice System
[2.265] Michael Legg, “Reconciling the Goals of Minimising Cost and Delay with the Principle of
a Fair Trial in the Australian Civil Justice System” (2014) 33(2) Civil Justice Quarterly 157 [footnotes
omitted]
I INTRODUCTION
The concept of an overriding or overarching purpose that requires attention to justice, cost and
delay (“Purpose Requirement”) now exists in almost all Australian jurisdictions. The concept is of
major significance because of its status as an objective for the civil justice system, the fulcrum upon
which case management pivots and a guide to the interpretation of rules of civil procedure. Another
important concept for civil justice is the principle of a fair trial, which incorporates procedural fairness,
also known as due process or natural justice. From a normative perspective fairness has been viewed as
a desirable quality in its own right. Fairness has been found to be a critical factor in citizen satisfaction
with, and endorsement of, institutions, including compliance with outcomes. Fair processes are
central to public confidence in the justice system and, as the justice system is a component of the
State, in the support of civil society and democracy. The main goal of this article is to consider the
interaction and overlap between a statutory or rule-​based Purpose Requirement and the principle of
a fair trial because the interaction is of significance to not just litigants before the Courts, but due to
their fundamental nature, to Australian society more generally. …
VI THE OPERATION OF A PURPOSE REQUIREMENT
… “Justice” in the context of the court system may be conceived of in at least two ways: arriving at
the correct result and ensuring procedural fairness. However, the High Court in Aon Risk explained
that a just resolution requires minimising cost and delay. Further, “justice” in civil litigation has also
traditionally been viewed from the perspective of justice as between the parties to a particular case.
However pressure on public resources and delay resulting from traditional civil procedures has meant
“justice” has been broadened to include taking into account cost, delay and prejudice to other users
of the civil litigation system. Justice, whether in terms of producing an accurate outcome or affording
a fair process, and whether looked at from the perspective of the litigant before the court or the
litigant standing in line waiting to access the court, has embedded within it time and cost elements.
This conception of justice requires further consideration. If justice with its dimensions of cost and
delay was widely accepted then there would be no need for a Purpose Requirement that expressly
referred to cost and delay. The object of the Purpose Requirements discussed above must be to raise
awareness of the cost and delay dimensions and alter the weight or significance given to them. The
aim is to change the culture of civil litigation.
A Purpose Requirement is a tool of interpretation that comes to the fore when there is a discretion
to be exercised by the Court, especially in the context of case management. The High Court in
Aon adopted this approach in deciding how a power of amendment was to be exercised. It follows
that a Purpose Requirement does not trump other procedural provisions but instead informs how
they should be interpreted or applied. The reference to cost and delay may change the traditional
reference point where “doing justice” was a goal to be pursued without regard to delay and expense,
but a Purpose Requirement does not operate alone or without regard to the requirements of other
procedural provisions.
A Purpose Requirement also impacts on how a discretion is to be exercised by specifying those
matters that must or may be considered. In exercising a discretion about whether to make a particular
decision a Court must weigh the impact of that decision on each of justice, cost and delay. …
The weighing or balancing exercise means that the waste of costs and some degree of delay do
not necessitate that the request for an indulgence must be denied as the requirements of justice must
also be weighed. … Of course where the need for the indulgence arises from non-​compliance that is
intentional, or no explanation is provided, the balancing exercise will be more straightforward. This
process will be referred to further below as it is crucial to the fair trial requirement.
[2.265]
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Lastly, the parties need to assist the Court in the balancing of justice, cost and delay. This includes
providing an explanation for any indulgence sought, and the impact of the indulgence on justice,
cost and delay. It may also mean refraining from conduct that is contrary to a Purpose Requirement.
Indeed, if the parties, but more likely their lawyers, do not assist the Court in furthering the objects
of a Purpose Requirement they may be subject to a costs order. Moreover, being able to explain the
reason for a delay and demonstrate that an indulgence is made in good faith may be necessary for a
lawyer to be able to discharge their duty to the court.
VII THE PRINCIPLE OF A FAIR TRIAL
The former High Court Chief Justice Murray Gleeson explained the conundrum of seeking to address
cost and delay in civil litigation as follows:
It is characteristic of the judicial process that it seeks to be fair. Some people would say
another characteristic is that the process is slow and expensive. How do you reverse the
second and preserve the first?
In the context of Parliament and courts widely adopting Purpose Requirements, which are a potential
answer to Gleeson’s question, the focus of debate shifts to how does the principle of a fair trial
and a Purpose Requirement interact? Has the express adoption of concerns about cost and delay
compromised the principle in Australian law of a fair trial?
[The content of procedural fairness is explained in Chapter 1. It includes that a court be and
appear to be impartial, and provide each party to proceedings before it with an opportunity to be
heard, to advance its own case and to answer, by evidence and argument, the case put against it.]
B. Procedural Fairness May Conflict with Reducing Cost and Delay
Purpose Requirements are supported by case management powers that “can often be seen to have
sharp, and sometimes detrimental effects on the claims of parties”. A failure to comply with directions
such as through the late filing of evidence or amendments to pleadings or repeated requests for
adjournments can be met with not just denial of the applications but claims being struck out or costs
orders imposed. Similarly, a court has power to give directions as to the conduct of any hearing,
including limiting the time that may be taken in the examination or cross-​examination of a witness,
limits on witness numbers and the number of documents tendered. Case management aims to reduce
cost and delay. However, refusing evidence, amendments and adjournments, or placing limits on oral
and documentary evidence may prevent a party from advancing their case or answering the case
made against them.
In ASIC v Rich [[2009] NSWSC 1229], Austin J of the Supreme Court of New South Wales reviewed
some of the techniques for reducing trial length but ultimately rejected them in general or in
application to the specific case before him. In doing so Austin J raised the following “fundamental
principle”:
The course of this trial raises a general question as to how far the court can and should go in
abbreviating hearing time in a case which, as formulated and defended, is destined to cover
huge and difficult evidentiary ground and to consume a large quantity of judicial resources.
… Manufacturing special procedures simply to deal with the length of the trial seems to me
to raise a real risk of injustice, and so I have not done so. The fundamental principle to be
observed by a judge who is required to manage and hear a long case, indeed any case, is to
strive to do justice, procedural and substantive, between the parties according to law.
One part of the irreducible core of doing procedural justice according to law is (subject to
some limitations, of course) to facilitate the plaintiff’s presentation of the case it has chosen
to bring to court, and to facilitate the defendant’s answering of that case in court. It is not
the judge’s function to stand in the way of the plaintiff or the defendant presenting their
respective cases. A judge who restricts the presentation of a case on the ground that the
case is too long, or too detailed, or too complex, runs the risk that his or her ruling will be
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tantamount to shutting down that party’s case. The same considerations apply to restricting
cross-​examination to such a degree that significant components of the evidence cannot be
addressed by the cross-​examiner.
In short, procedural fairness entails cost and delay. The passing of time may be a side-​effect of ensuring
fairness because evidence must be gathered, argument put and both considered. A similar point may
be made in relation to costs. Expenditure is needed to undertake fact-​finding, hold a hearing and
apply the law. Justice Sackville has illustrated the point by observing that providing a party with a
reasonable opportunity to lead evidence, cross-​examine witnesses and present a case may be difficult
to achieve quickly and cheaply, as required by the overriding purpose in New South Wales.
C. Reduction of Cost and Delay Promotes Procedural Fairness
The pursuit of the reduction of cost/​delay and provision of procedural fairness are goals that can
conflict, but they may also be pursued together with consistency. Delay can see the loss of evidence,
both documentary and testimonial, so that it is not available to be put in one’s case or defence. Cost
can impact procedural fairness by making legal representation unattainable or limit a party’s ability
to conduct the necessary forensic steps to make out or defend a claim. Moreover, delay can impact
the accuracy of fact-​finding and undermine the practical utility of judgments as matters move on
outside the court room. A civil justice system that is too expensive may deny access to justice so that
wrongs cannot be redressed or the system’s costs may consume the fruits of successful litigation. A fair
process that incorporates excessive cost and delay is a process of little utility. In Bi v Mourad [[2010]
NSWCA 17], Allsop P explained that dealing with cases expeditiously was necessary if they were to be
dealt with justly because:
Delay and case backlog are not merely factors affecting the costs of delivering justice; they
corrode the ability of the courts to provide individual justice. The reforms that have taken
place under the Civil Procedure Act and the evident attempt by courts to ensure efficiency
can be seen not merely to reflect worthy efforts for efficiency but also to be steps vital for the
provision of timely individual justice.
Requirements to promote procedural fairness can also unnecessarily generate costs that undermine
justice. The US Supreme Court in considering the requirements of the Due Process Clause of the US
Constitution has pointed to the need to consider the risk of the deprivation of a due process right
through the procedures used compared with the cost or value of additional or substitute procedural
safeguards. It follows that additional steps to promote procedural fairness may have costs beyond any
added protection. Similarly, a reduction in safeguards may not increase the risk of procedural fairness
being compromised. To provide an example, in multi-​defendant cases where the defendants’ interests
are aligned it is common for a judge to only allow the defendants to call a single expert witness,
or to require only one counsel from those representing the various defendants to cross-​examine
the plaintiff’s witnesses. Allowing each defendant to select their own expert or have all defendants
have their chosen counsel cross-​examine witnesses might better promote procedural fairness for each
defendant but it would be at much greater cost and delay with probably marginal gains in terms of
procedural protections. Indeed the costs and delay associated with such an approach would not just
impact the plaintiff and other court users it is also borne by the defendants.
Procedural fairness is often seen as an individual right but allowing the right to be unbounded
can impinge on the rights of others. In the UK the right to a fair trial under the Human Rights
Act 1998 (UK) has been considered in relation to the enforcement of procedural requirements.
It has been recognised that “the right to a fair trial is indivisible, in the sense that all parties are
entitled to it”. It follows that a party that complies with procedural directions may justifiably feel
aggrieved if a defaulting party is repeatedly allowed to avoid compliance. In the UK context the
complying party may be able to complain about a contravention of its right to a fair trial. Indeed,
a court’s ability to provide a fair trial would be seriously hampered if it could not enforce its rules
and directions.
[2.265]
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Reconciling the Goals of Minimising Cost and Delay with the Principle of a Fair Trial cont.
In the Australian context, the plurality judgment in Aon Risk, referring to what Waller LJ said in
Worldwide Corporation Ltd v GPT Ltd [1998] EWCA Civ 1894, recognised that where a party has had
a sufficient opportunity to plead its case it may be necessary for the court to make a decision which
may produce a sense of injustice in that party for the sake of doing justice to the opponent and other
litigants. What is seen as doing justice to one party is the imposition of costs and delay to another
party. At some point, those additional costs and delay may result in a denial of procedural fairness to
the other party. The point may be illustrated by Justice Rogers’ observations about a lengthy family
law case, In the Marriage of Collins:
The proceedings throw up quite vividly the collision that exists between the traditional
concept, that it is part of requirements of natural justice that a judge allow a party to present
its case in full, no matter what, and the demands of ordinary justice that a litigant should not
be allowed to be bled white, or to be oppressed by a wealthy party, taking as long as it likes
in the conduct of the litigious process.
It must be remembered that in some disputes, cost and delay are tactical weapons used to allow one
side to obtain an advantage over another. One side will be anxious to bring the case on as quickly
and cheaply as possible. The other may have an interest in avoiding resolution, especially where
the outcome may create an unfavourable precedent or places a business in jeopardy. Requests for
procedural steps needed to ensure procedural fairness may be an attempt to disguise the imposition
of cost and delay on an opponent. Purpose Requirements aim to discourage such conduct through
the imposition of duties on parties and legal representatives, and in some provisions even litigation
funders and insurers, to promote the aims contained in a Purpose Requirement. Procedural steps
aimed at reducing cost and delay can promote procedural fairness for the individual and for the court
system as a whole.
D. Balancing Procedural Fairness, Cost and Delay
Even though reducing delay and cost can advance procedural fairness there remains an issue as to
when the use of case management powers in aid of controlling cost and delay, and in taking account
of other court users waiting in the cue to get before a judge, may go too far. Justice Austin is correct
that there is an irreducible core of procedural justice which must be maintained. It is the essence
of a court and of the judicial function. However, it does not equate to allowing parties and their
lawyers free rein. As explained above, not imposing restrictions may compromise procedural justice
for another party. Procedural fairness, like a Purpose Requirement, requires a balancing of factors.
Procedural fairness is able to be accommodated within the requirements of a Purpose Requirement.
The requirement of a fair trial must form part of that component of a Purpose Requirement that
requires courts to act in a “just” manner or to seek to achieve a just resolution of proceedings. Fidelity
to the principle of a fair trial means that concerns of cost and delay must be considered but they must
be weighed against the steps that are necessary to ensure procedural fairness is provided. Time limits
may be imposed on evidence and argument but it must be consistent with the basic requirements
of fair process. Similarly, case preparation steps, such as discovery, may be abbreviated provided the
core of procedural justice is preserved. Further, requests for indulgences such as amendments and
adjournments need to weigh the procedural fairness to all parties with the costs and delay that will
follow.
A Purpose Requirement that mandates the balancing of justice, cost and delay makes what is
required to do justice (in a multi-​dimensional sense) in a particular case a more explicit consideration
for the courts, parties and legal practitioners. It provides a framework for the exercise of judicial
discretion and a guide for parties and their lawyers as to the matters they must address. The application
of a Purpose Requirement and the principle of a fair trial to a specific case are likely to be difficult
when there is a need to resolve a conflict between taking steps to accord fair process to one party
that also involves the incurrence of cost and the occasioning of delay to another party. No universal
outcome can be stated. Rather the process of carefully weighing the factors of justice, cost and delay,
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as mandated by a Purpose Requirement, must occur. Consideration of each factor, rather than a
reflexive response to do justice, cut costs or prevent delay, is most likely to produce the best outcome.
As the High Court has observed “the powers of the court are not at large and are not to be exercised
according to a judge’s individualistic idea of what is fair in a given circumstance”. The framework
provided by a Purpose Requirement provides for discretion so as to assist case management but also
cabins that discretion by specifying the court’s considerations.

ETHICAL REQUIREMENTS
[2.270] The requirements of the overriding purpose are reinforced by the duty to the court
and the requirement to exercise independent judgment, including limiting hearings to the
real issues in dispute and presenting the client’s case as quickly and simply consistent with its
robust advancement. The Legal Profession Uniform Law Australian Solicitors’ Conduct Rules
2015 provides:
3
Paramount duty to the court and the administration of justice
4
3.1 A solicitor’s duty to the court and the administration of justice is paramount and
prevails to the extent of inconsistency with any other duty.
Other fundamental ethical duties
4.1 A solicitor must also:
4.1.1
act in the best interests of a client in any matter in which the solicitor
represents the client,
4.1.2
be honest and courteous in all dealings in the course of legal practice,
4.1.3
deliver legal services competently, diligently and as promptly as reasonably
possible,
4.1.4
avoid any compromise to their integrity and professional independence, and
4.1.5
comply with these Rules and the law.
17 Independence –​avoidance of personal bias
17.1
A solicitor representing a client in a matter that is before the court must not act
as the mere mouthpiece of the client or of the instructing solicitor (if any) and
must exercise the forensic judgments called for during the case independently,
after the appropriate consideration of the client’s and the instructing solicitor’s
instructions where applicable.
17.2
A solicitor will not have breached the solicitor’s duty to the client, and will not
have failed to give appropriate consideration to the client’s or the instructing
solicitor’s instructions, simply by choosing, contrary to those instructions, to
exercise the forensic judgments called for during the case so as to:
17.2.1
confine any hearing to those issues which the solicitor believes to be
the real issues,
17.2.2
present the client’s case as quickly and simply as may be consistent
with its robust advancement, or
17.2.3
inform the court of any persuasive authority against the client’s case.
[2.270]
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Civil Procedure in New South Wales
Rule 23 of the Legal Profession Uniform Conduct (Barristers) Rules 2015 provides that “[a]‌
barrister has an overriding duty to the court to act with independence in the interests of the
administration of justice”. Rules 42 and 43 equate with rr 17.1 and 17.2. The rules also deal
with the efficient administration of justice as follows:
57. A barrister:
(a)
must seek to ensure that the barrister does work which the barrister is briefed to do
in sufficient time to enable compliance with orders, directions, rules or practice notes
of the court; and
(b)
if the barrister has reasonable grounds to believe that the barrister may not complete
any such work on time, must promptly inform the instructing solicitor or the client.
58. A barrister must seek to ensure that work which the barrister is briefed to do in relation
to a case is done so as to:
(a)
confine the case to identified issues which are genuinely in dispute;
(b)
have the case ready to be heard as soon as practicable;
(c)
present the identified issues in dispute clearly and succinctly;
(d)
limit evidence, including cross-​examination, to that which is reasonably necessary to
advance and protect the client’s interests which are at stake in the case; and
(e)
occupy as short a time in court as is reasonably necessary to advance and protect the
client’s interests which are at stake in the case.
59. A barrister must take steps to inform the opponent as soon as possible after the barrister
has reasonable grounds to believe that there will be an application on behalf of the client
to adjourn any hearing, of that fact and the grounds of the application, and must try, with
the opponent’s consent, to inform the court of that application promptly.
PRACTICE NOTES
[2.280] Section 15 of the CPA gives a statutory basis for the issue of practice notes and
regulates the relationship between itself and the UCPR. Each senior judicial officer of the
Local, District and Supreme Courts will be able to issue practice notes to deal with specific
aspects of civil proceedings in their respective courts. Under the operation of s 15 of the CPA,
the practice notes will be subject to the UCPR and they can be disallowable under Pt 6 of the
Interpretation Act 1987 (NSW).
Practice notes are a convenient way of indicating the practicalities of procedure in divisions
and lists within the divisions of each court. For example, Practice Note SC Gen 1 Supreme
Court –​Application of Practice Notes indicates that all practice notes in the Supreme Court
will begin with the letters “SC”. Practice notes that relate specifically to a court, a division or
a divisional list will generally be numbered from the numeral 1 with an abbreviation for the
court or division (ie “CA” for the Court of Appeal, “CL” for the Common Law Division and
“Eq” for the Equity Division). As a result, the first practice note for the Court of Appeal will be
numbered SC CA 1. Practice notes that relate to a general issue with application across one or
more of the courts or divisions have an abbreviation of “Gen”. Where an amendment is made
to a practice note, rather than issuing a fresh number to that practice note, a new version of
the existing practice note is issued. The comprehensive list of Supreme Court practice notes
can be found on the Supreme Court’s website at http://​www.supremecourt.justice.nsw.gov.
au. The text of relevant practice notes will be referred to throughout this text. An example of
how a practice note may deal with case management is provided by Practice Note SC CL 7.
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Practice Note SC CL 7
[2.290] Practice Note SC CL 7 Supreme Court Common Law Division –​Professional Negligence List
This practice note applies to proceedings in the Common Law Division that include a claim
for medical or legal professional negligence, or such other suitable proceedings as mentioned in
paragraph 5 of the practice note.
Stated broadly, when a plaintiff files an originating process a notice is issued by the registry
indicating a first directions hearing approximately three months later. Before the first directions
hearing, parties are expected to have discussed the case and:
• agreed on suitable interlocutory orders, directions or arrangements;
• prepared a draft timetable for the future management of the proceedings;
• prepared draft short minutes of any orders or directions to be sought at the directions hearing.
The practice not also informs the parties that indemnity costs may be awarded in respect of work
necessitated by an unreasonable failure to provide access to or copies of medical or hospital records
before or after commencement of proceedings.
At the directions hearing the registrar or judge manages how the case will proceed eg the provision
of further information, the making of admissions, the administration and answering of interrogatories,
an early separate trial on liability and the consent transfer of proceedings to the District Court. The
registrar or judge may also consider at any directions hearing whether the proceedings are suitable
for mediation and may direct the parties to confer on that suitability. The practice note states that if it
appears to the court that the matter is suitable for mediation, it will endeavour to secure the consent
of the parties to a referral to mediation and may give directions to enable the parties to prepare for
mediation.
Directions Hearings, other than the first Directions Hearing for cases to be heard in Sydney, may
be conducted by online court or by telephone. Parties who wish to use the online court are to do so
in accordance with Practice Note SC Gen 12 (discussed below). Parties wishing to avail themselves
of telephone facilities must advise the Sydney Registry in writing at least 7 days prior to the date
scheduled for the Directions Hearing.
The practice note also specifies that expert evidence in matters on the list is likely to be limited. For
example, if the court considers that a party is seeking to call an unnecessary expert, the court may
reject the tender of the expert’s report; refuse to allow the expert to be called; and disallow any costs
associated with that expert’s evidence preparation. Where the parties cannot agree on a single expert
to give evidence about an issue and multiple experts are necessary, the court will make directions
at an appropriate Directions Hearing, one of which is likely that the experts will give their evidence
concurrently. Where the issue is the quantification of damages for death or personal injury, the default
expectation is that the parties will be allowed one medical expert in any specialty, unless there is an
issue as to an ongoing disability, in which case two experts in a relevant specialty concerning that
disability are allowed. For any other damages issues, only two experts of any other kind are allowed.
The default rule is that a single expert direction will be taken to have been made at the first
Directions Hearing unless otherwise ordered. At the first Directions Hearing, the parties are to produce
a schedule of the issues in respect of which expert evidence may be adduced and identify whether
those issues can be addressed by a single expert or whether an expert witness retained by each party
to give evidence concurrently will be necessary. In addition, if concurrent experts are to give evidence,
then within 14 days of the expert evidence being served the parties are to agree on the questions to
be asked of the witnesses, or be required to re-​list the proceedings for further directions with respect
to the witness questions if the parties cannot agree.

[2.290]
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ELECTRONIC CASE MANAGEMENT
[2.300] Electronic case management holds great promise for reducing cost and delay. It is
anticipated that electronic innovations such as online lodgment of documentation, e-​service of
documents, e-​callovers and 24/​7 access to services will either become available or be expanded
in the future. Currently, the Online Registry has more than 80 forms that can be filed online,
such as statements of claim, defences and notices of appearance. Expanded e-​services will
mean, for example, that any registry in New South Wales would be able to receive documents
for each of the jurisdictions. For example, a legal practitioner in Yass could file a Supreme
Court application at the Yass Local Court; a solicitor could also file a Local Court matter
to be heard in Broken Hill and make inquiries about a matter in Goulburn. Such e-​services
would enhance flexible service delivery and the speed and quality of service delivery to both
face-​to-​face and e-​clients.12
The legislative foundation for electronic case management is the Electronic Transactions
Act 2000 (NSW) (ET Act). The Courts Legislation Miscellaneous Amendments Act 2002
(NSW) inserted Pt 2A entitled “Courts administration” (ss 14A–​14R) into the ET Act on 20
December 2002, which was subsequently moved to Sch 1 in 2010. Schedule 1 cl 2 of the ET
Act empowers the Attorney-​General to establish an electronic case management system (ECM
system) to do any one or more of the following:
(a) to enable documents with respect to legal proceedings to be created in electronic form,
(b) to enable documents with respect to legal proceedings to be filed in electronic form,
(c) to enable documents with respect to legal proceedings to be issued in electronic form,
(d) to enable documents with respect to legal proceedings to be used in electronic form,
(e) to enable documents with respect to legal proceedings to be served in electronic form,
(f) to enable parties to legal proceedings to communicate in electronic form with other parties
to the proceedings and with the court before which the proceedings are being taken,
(g) to enable information concerning the progress of legal proceedings to be provided in
electronic form to parties to the proceedings and to members of the public generally,
(h) to enable information concerning legal proceedings to be exchanged in electronic form
between such persons or bodies as are prescribed by rules of court.
Schedule 1 cl 3 of the ET Act provides that the Attorney-​General may, by order published
on the NSW legislation website, authorise the use of an ECM system by such courts (ECM
courts), and for such purposes, as are specified in the order. On 28 October 2005, the Attorney-​
General made the Electronic Transactions (ECM Courts) Order 2005 (ECM Courts Order),
which has been amended on a number of occasions.
In relation to civil litigation, the ECM Courts Order authorises the courts in column 1
below to use JusticeLink (an ECM system established by the Attorney-​General under Sch 1 cl
3 of the ET Act) for the purposes in column 2.
Column 1
Column 2
Court
Purpose
Supreme Court
Use in civil proceedings in the Corporations List, but only so as to enable
documents to be filed, issued, used and served in electronic form.
12
Glanfield L, Consistency in Court Rules –​The NSW Partnership, 22nd AIJA Annual Conference, Proportionality –​
Cost-​Effective Justice? (17–​19 September 2004).
114
[2.300]
Case Management in New South Wales
Column 1
Column 2
Court
Purpose
Chapter 2
Use in civil proceedings in the Possession List, but only so as to enable documents
to be filed, issued, used and served in electronic form.
Use in civil proceedings in the Equity Division, but only so as to enable parties to the
proceedings to communicate in electronic form with the Supreme Court in connection
with any business of the Court that is being conducted in the absence of the public.
Use in civil proceedings in the Common Law Division, but only so as to enable
parties to the proceedings to communicate in electronic form with the Supreme
Court in connection with any business of the Court that is being conducted in the
absence of the public.
District Court
Use in civil proceedings, but only so as to enable parties to the proceedings to
communicate in electronic form with the District Court in connection with any
business of the Court that is being conducted in the absence of the public.
Local Court
Use in civil proceedings, but only so as to enable parties to the proceedings to
communicate in electronic form with the Local Court in connection with any
business of the Court that is being conducted in the absence of the public.
The ECM Courts Order authorises the Supreme Court, District Court and Local Court
to use Online Registry (an ECM system established by the Attorney-​General under Sch 1 cl
3 of the ET Act) in civil proceedings, but only so as (1) to enable documents to be created,
filed, issued, used and served in electronic form, (2) to enable parties to the proceedings to
communicate in electronic form with other parties to the proceedings and with the Court
and (3) to enable information concerning the progress of the proceedings to be provided in
electronic form to parties to the proceedings and to members of the public generally.
[2.310] Schedule 1 cl 14 of the ET Act enables an ECM court to make rules, not inconsistent
with the Schedule, with respect to ECM matters. ECM matters are defined as:
(a) the kinds of proceedings in respect of which the ECM system may or must be used in
relation to a court,
(b) the kinds of documents that may or must be filed in a court by means of the ECM system,
(c) the kinds of documents that may or must be issued by a court by means of the ECM system,
(d) the practice and procedure to be followed in connection with:
(i) documents that are filed in a court, or issued by a court, by means of the ECM
system, and
(ii) the conduct of hearings by electronic communication sent by means of the ECM
system,
(e) the persons to whom, the circumstances in which and the conditions on which access
may be given to information contained on the ECM system in relation to the court and
proceedings before a court,
(f) any other matter with respect to the operation, use or control of the ECM system in
relation to a court and proceedings before a court.
The UCPR contains Pt 3 (rr 3.1–​3.15) entitled “Electronic Case Management”.
The entirety of Pt 3 was replaced by the Uniform Civil Procedure Rules (Amendment No 63)
2013, which commenced on 10 February 2014. Part 3 makes provision for the registration of
users, filing and service of a document, filing of affidavits and requests to issue a subpoena.
Practice Note SC Gen 12 Supreme Court –​Online Court Protocol commenced on 8
February 2007. It applies to the Court of Criminal Appeal where an application for extension
[2.310]
115
Civil Procedure in New South Wales
of time or a notice of appeal has been lodged; matters in the Common Law Division and
selected matters in the Equity Division. It does not apply to self-​represented litigants.
Online court is at the discretion of a judicial officer and may be used for any hearing
permitted by s 71 of the CPA (see Chapter 1). It is available to legal practitioners who are
registered users and who are invited to participate by a judicial officer in accordance with
r 3.9 of the UCPR (now r 3.8). At the discretion of a judicial officer, an order may be made that
any or all directions hearings of any case will be conducted via online court. If such an order
is made all legal practitioners involved must ensure they are registered users.
An online court is a virtual courtroom, and it can only be used for issues requiring
consideration by a judicial officer (ie it is not to be used for communications solely between
the representatives of the parties). It is a place where the language used is the same as that
used in an ordinary court and as in an ordinary court any undertakings given are binding.
Contempt rules also apply. Information about the online court, including practicalities such
as getting registered and logging on, can be found at the NSW Online Registry Website.13 The
interaction between the lawyers and court is achieved through posting a message similar to
sending an email as the Online Registry allows for a user to specify a subject, message and
attach documents. The record or transcript of the interaction between the lawyers and court
is similar to instant messaging in which each post appears in order.
Justice Ian Gzell conducted a pilot program of online court in the Equity Division of the
Supreme Court of New South Wales.14 Two days after the commencement of Practice Note
SC Gen 12, on 24 March 2006, his Honour delivered the judgment of Koompahtoo Local
Aboriginal Land Council v KLALC Property & Investments Pty Ltd (No 2).15 Justice Gzell
outlined the statutory framework and the court’s power to open an ECM court and then held:
[i]‌n order that future directions and interlocutory applications that it is appropriate to conduct
in the absence of the public may be conducted by the ECM system, I will open an ECM Court.16
His Honour also ordered:
[P]‌ursuant to the Civil Procedure Act 2005, s 71(f) I direct that any future directions hearings
and, unless otherwise ordered, any interlocutory applications in these matters be conducted
in the absence of the public. In terms of the Electronic Transactions Act 2000, s 14I and the
Uniform Civil Procedure Rules 2005, r 3.9 [now r 3.8], I direct that until further order such
pre-​trial directions and interlocutory applications be conducted by electronic communication
sent and received by means of the ECM system.
Justice Gzell thereafter commenced using the virtual court for pre-​trial directions hearings in
suitable proceedings.17 In addition to making similar orders as he made in Koompahtoo, his
Honour has adopted the practice of issuing a short note to the solicitors on the record which
reads as follows:
ecmCourt Requirements by Justice Gzell
Please note that Justice Gzell will no longer hold pre-​trial direction hearings. Instead his
Honour will conduct ecmCourts for all formal matters. All counsel and solicitors in any matter
13
14
15
16
17
https://​onlineregistry.lawlink.nsw.gov.au/​content/​.
See “Internet Court Gets First Case”, The Sydney Morning Herald, 29 October 2006.
Koompahtoo Local Aboriginal Land Council v KLALC Property & Investments Pty Ltd (No 2) [2006] NSWSC 169.
Koompahtoo Local Aboriginal Land Council v KLALC Property & Investments Pty Ltd (No 2) [2006] NSWSC 169
at [8]‌.
See, for example, the reference to the ECM court in Sheahan v Slattery (No 2) [2006] NSWSC 711 at [7]‌.
116
[2.310]
Case Management in New South Wales
Chapter 2
set down for hearing before his Honour are required to register for eServices and to advise his
Associate when this is done.
To register, please visit website: http://​www.lawlink.nsw.gov.au/​courtlink.
However the ECM court caused difficulty in Hill v W & F Lechner Pty Ltd18 after Justice Gzell
had opened the ECM court and directed the solicitors and counsel for the parties to become
registered as users of the ECM system under r 3.3 of the UCPR. The solicitor for the defendant
despite repeated requests failed to cause counsel for the defendant to become a registered
user and to notify his Honour’s Associate. Justice Gzell listed the matter for a hearing in the
ordinary courtroom and delivered an ex tempore judgment which held:
[10] As s 56(1) of the Civil Procedure Act 2005 states, the overriding purpose of the Act and the
Uniform Civil Procedure Rules 2005 is to facilitate the just, quick and cheap resolution of the
real issues in proceedings. The ECM Court facility for which provision is made in the Electronic
Transactions Act 2000, s 14I and in the Uniform Civil Procedure Rules 2005, r 3.9 [now r 3.8]
is one way of obtaining that objective. But it will not work if the legal representatives of the
parties will not cooperate.
[11] In view of the failure of the solicitor for the defendant to carry out my Associate’s
requests I make these orders. I order the legal representatives of the defendant and any other
legal representatives of the plaintiff to apply to the Registrar for registration of themselves
and any person authorised by them as users of the ECM system in terms of the Uniform Civil
Procedure Rules 2005, r 3.3 and inform my Associate of the names of the persons so registered
by no later than 4.00 pm on Tuesday 16 May 2006.19
[12] Again, because the system is new, I do not propose to order the solicitor for the
defendant to pay the costs of this unnecessary hearing personally under the Civil Procedure Act
2005, s 99. I order the defendant to pay the plaintiffs’ costs of today’s hearing on an indemnity
basis forthwith upon assessment or agreement.20
Three years later in Sedrak v Starr, Gzell J posted the following message in the ECM court:21
Non-​compliance
As the defendant alleges that the plaintiff has failed to comply with my orders and its
representatives have failed to register to conduct proceedings in this matter by electronic
communication sent and received by means of the ECM system, I have by the appended order
stood this matter over before me in open court. The legal representatives are reminded that a
costs order may be made against them personally under the Civil Procedure Act 2005, s 99 and
that the rules in relation to contempt of court apply to ECM court proceedings.
ADMINISTRATION OF THE UNIFORM CIVIL PROCEDURE RULES
[2.320] The UCPR is created by the Uniform Rules Committee.
Civil Procedure Act 2005 (NSW)
[2.330] Civil Procedure Act 2005 (NSW) ss 8, 9, 14–​16
Part 2 Administrative Matters
Division 1 Rules, practice notes and forms
18
19
20
21
Hill v W & F Lechner Pty Ltd [2006] NSWSC 440.
Hill v W & F Lechner Pty Ltd [2006] NSWSC 440 at [10]–​[12].
Hill v W & F Lechner Pty Ltd [2006] NSWSC 440 at [10]–​[12].
Sedrak v Starr [2009] NSWSC 996 at [5]‌.
[2.330]
117
Civil Procedure in New South Wales
Civil Procedure Act 2005 (NSW) cont.
8 Uniform Rules Committee
(1)
There is to be a Uniform Rules Committee comprising 11 members, of whom:
(a)
one is to be the Chief Justice of the Supreme Court or a Judge of the Supreme Court
nominated for the time being by the Chief Justice, and
(b)
one is to be the President of the Court of Appeal or a Judge of Appeal nominated for
the time being by the President, and
(c)
two are to be Judges of the Supreme Court appointed by the Chief Justice, and
(c1)
one is to be the Chief Judge of the Land and Environment Court or a Judge nominated
for the time being by the Chief Judge, and
(d)
one is to be the Chief Judge of the District Court or a Judge of the District Court
nominated for the time being by the Chief Judge, and
(e)
one is to be a Judge of the District Court appointed by the Chief Judge, and
(f)
one is to be the Chief Magistrate or a Magistrate nominated for the time being by the
Chief Magistrate, and
(g)
one is to be a Magistrate appointed by the Chief Magistrate, and
(h)
one is to be a barrister appointed by the Bar Council, and
(i)
one is to be a solicitor appointed by the Law Society Council.
9 Uniform rules
(1)
The Uniform Rules Committee may make rules, not inconsistent with this Act, for or with
respect to any matter that by this Act is required or permitted to be prescribed by rules or that
is necessary or convenient to be prescribed by rules for carrying out or giving effect to this Act.
…
(4)
The rules made under this section may authorise or require the use of an electronic case
management system established under clause 2 of Schedule 1 to the Electronic Transactions Act
2000 in relation to any proceedings in a court in respect of which the use of such a system is
authorised by an order in force under clause 3 of Schedule 1to that Act.
14 Court may dispense with rules in particular cases
In relation to particular civil proceedings, the court may, by order, dispense with any requirement of
rules of court if satisfied that it is appropriate to do so in the circumstances of the case.
15 Practice notes
(1)
Subject to rules of court, the senior judicial officer of the court may issue practice notes for that
court in relation to civil proceedings to which this Act applies.
(2)
A practice note must be published in the Gazette.
(3)
Sections 40 and 41 of the Interpretation Act 1987 apply to a practice note in the same way as
they apply to a statutory rule.
16 Court may give directions in circumstances not covered by rules
(1)
In relation to particular civil proceedings, the court may give directions with respect to any
aspect of practice or procedure for which rules of court or practice notes do not provide.
(2)
Anything done in accordance with such a direction (including the commencing of proceedings
and the taking of any step in proceedings) is taken to have been validly done.

118
[2.330]
CHAPTER 3
Costs of Litigation
[3.10]
[3.20]
[3.100]
[3.120]
[3.170]
[3.220]
[3.280]
[3.320]
[3.350]
[3.390]
[3.410]
[3.500]
INTRODUCTION.........................................................................................................
PROPORTIONALITY OF COSTS....................................................................................
[3.30]
Civil Procedure Act 2005 (NSW) s 60....................................................
[3.50]
Access to Justice and Access to Lawyers..................................................
[3.57]
Bleyer v Google Inc............................................................................
[3.70]
Zanella v Madden.............................................................................
THE PURPOSE OF COSTS.............................................................................................
[3.110]
Northern Territory v Sangare...............................................................
DUTIES OF LITIGANTS AND COSTS.............................................................................
[3.130]
Civil Procedure Act 2005 (NSW) s 56....................................................
[3.140]
Priest v New South Wales...................................................................
[3.160]
Civil Procedure Act 2005 (NSW) s 98....................................................
PARTIES AND COSTS...................................................................................................
[3.180] Uniform law costs.......................................................................................
[3.190] Ordered costs..............................................................................................
[3.200] Costs follow the event –​the usual costs order.............................................
[3.210]
Baulderstone Hornibrook Engineering v Gordian Runoff.............................
LAWYERS AND COSTS.................................................................................................
[3.230]
Legal Profession Uniform Law Application Act 2014 (NSW) Sch 2................
[3.260]
Civil Procedure Act 2005 (NSW) s 99....................................................
[3.270]
Treadwell v Hickey............................................................................
SPECIFIC COSTS ORDERS............................................................................................
[3.280] No order as to costs....................................................................................
[3.290] Costs of the day..........................................................................................
[3.300] Costs in any event.......................................................................................
[3.310] Costs in the cause.......................................................................................
JOINING PARTIES AND COSTS....................................................................................
[3.330]
Nationwide News v Naidu; ISS Security v Naidu (No 2).............................
COSTS AND SELF-​REPRESENTED LITIGANTS................................................................
[3.360]
Cachia v Hanes................................................................................
[3.380]
Bell Lawyers v Pentelow......................................................................
COSTS AGAINST NON-​PARTIES...................................................................................
[3.400]
Heath v Greenacre Business Park..........................................................
SECURITY FOR COSTS.................................................................................................
[3.420]
Wollongong City Council v Legal Business Centre.....................................
[3.440]
Idoport v National Australia Bank.........................................................
[3.460]
Uniform Civil Procedure Rules 2005 (NSW) rr 2.1, 42.21...........................
[3.470]
Civil Procedure Act 2005 (NSW) s 67....................................................
[3.490]
Welzel v Francis................................................................................
PROPOSALS FOR CONTAINING COSTS.......................................................................
[3.510]
Containment of Costs: Litigation and Arbitration.....................................
[3.530]
Reforming the Structure of Costs Awards................................................
119
120
120
121
123
124
125
126
128
128
129
130
131
131
132
133
133
136
137
140
141
147
147
147
147
148
148
149
151
151
152
155
155
159
159
163
168
169
170
174
174
180
INTRODUCTION
[3.10] Costs are a very important issue when considering the administration of civil justice.
Costs affect access to justice because costs can place litigation beyond the reach of those who
cannot afford, or cannot afford to risk, the costs implications of resolving disputes.
[3.10]
119
Civil Procedure in New South Wales
Costs of an action can be generated and experienced by the court, the parties (both in a
personal and monetary sense), legal practitioners and other litigants whose proceedings are
waiting to be heard. The point was made in Chapter 2 that reducing costs is an important
focus for case management.
The imposition of costs during the course of an action is at the total discretion of the court.
According to s 98 of the Civil Procedure Act 2005 (NSW) (CPA), the court has full power to
determine by whom, to whom and to what extent costs are to be paid. Section 99 imposes
liability on neglectful or incompetent practitioners for unnecessarily incurred costs. Although
the purpose of a costs order is ostensibly not to punish, such an order can be a powerful
incentive to comply with the CPA, the Uniform Civil Procedure Rules 2005 (NSW) (UCPR),
court directions and practice notes. Of course, s 56 of the CPA allows the court to take into
account any breach of duties towards the “overriding purpose” of the CPA by parties and
practitioners when considering the making of costs orders.
Costs of litigation have generated a voluminous amount of literature1 and the provisions
concerning costs in the CPA and the UCPR are detailed and extensive. This chapter is designed
to provide an introduction to the rules, procedures and practices relating to costs in litigation.
PROPORTIONALITY OF COSTS
[3.20] In reducing costs, case management is greatly assisted by the concept of proportionality
of costs. Though this concept was explicitly recognised prior to the CPA,2 s 60 of the CPA now
gives it legislative force and the scheme of the legislation clearly intends that it is to be applied
in conjunction with ss 56–​59.3
Civil Procedure Act 2005 (NSW)
[3.30] Civil Procedure Act 2005 (NSW) s 60
Part 6 –​ Case management and interlocutory matters
Division 1 –​ Guiding principles
60 Proportionality of costs
In any proceedings, the practice and procedure of the court should be implemented with the object
of resolving the issues between the parties in such a way that the cost to the parties is proportionate
to the importance and complexity of the subject-​matter in dispute.

1
2
3
120
See, for example, Hamilton JP, Lindsay G, Morahan M and Webster C (eds), NSW Civil Handbook (Lawbook
Co, 2019) (UCPR Part 42, Commentary); Dal Pont DE, Law of Costs (4th ed, LexisNexis, 2018); Grace J and
Ashe A, Legal Costs New South Wales Online (LexisNexis); The Law Society of NSW, Costs Guidebook (7th
ed); Quick R and Harris E, Quick on Costs (Thomson Reuters); Cairns BC, Australian Civil Procedure (11th ed,
Thomson Reuters, 2016), Ch 17.
For example, in Skalkos v T & S Recoveries Pty Ltd (2004) 65 NSWLR 151; [2004] NSWCA 281 at [8]‌Ipp J
indicated that it was relevant to consider whether the costs incurred bore a reasonable relationship to the
value and importance of the subject matter of the case.
Section 60 of the Civil Procedure Act 2005 (NSW) is contained with ss 56–​59 in Part 6 –​Case Management
and Interlocutory Matters Division 1 –​Guiding Principles. See also Brabazon M, “Proportionality of Legal
Costs” (February 2006) 44(1) Law Society Journal (NSW) 68.
[3.20]
Costs of Litigation
Chapter 3
[3.40] What does “proportionality” mean? Chief Justice Spigelman in March 2007 provided
the following explanation:
Access to Justice and Access to Lawyers
[3.50] The Honourable JJ Spigelman, Chief Justice of New South Wales, “Access to Justice and Access
to Lawyers” (2007) 29 Australian Bar Review 136
There is now a widespread recognition that some sort of test of proportionality is required. The
cost of dispute resolution must in some manner be proportionate to what is in dispute. That is difficult
to achieve, particularly in circumstances where a civil dispute involves matters that are not able to
be computed in terms of money, at least on any objective basis likely to be accepted by all parties.
Nevertheless, the principle is a valid one.
Following the English lead [Civil Procedure Rules r 1.1(2)(c)], New South Wales has expressly
adopted, in s 60 of the Civil Procedure Act 2005, a requirement that the practices and procedures of
courts should be implemented with a view to resolving disputes “in such a way that the costs to the
parties is proportionate to the importance and complexity of the subject-​matter in dispute”. I accept
this is a statement of ambition, rather than a description of what occurs.
There is, of course, a great deal of flexibility in the words “importance and complexity”. This
objective, which I know is accepted in many jurisdictions which do not have the statutory mandate
found in New South Wales, requires a continual process of collaboration between the profession and
the courts in determining how the process of dispute resolution is to occur.
The first step must be to review areas of practice in which the costs involved in the process
sometimes bear no rational, let alone a proportionate, relationship to what is involved. This occurs
more frequently than we care to admit.
A classic case was the dispute over a property settlement following a divorce in an English
case which went on appeal as far as the House of Lords. The total value of the property in issue
was £127,400. The legal costs incurred by the English Legal Aid system, which assisted both
parties about … how the property should be divided, was estimated to exceed £128,000. As
Lord Hoffmann said:
If one includes applications for leave, the facts of this case, by the time it reached the Court
of Appeal had been considered by five differently constituted tribunals. This cannot be
right. To allow successive appeals in the hope of producing an answer which accords with
perfect justice is to kill the parties with kindness. [Piglowska v Piglowski [1999] 1 WLR 1360
at 1373.]
Lord Hoffmann’s reference to the “quest for perfect justice” reminds us that, neither in result nor in
process, does the word “justice” refer to an absolute. The objective of attaining fair outcomes arrived
at by fair procedures does not require identical conduct in every conceivable kind of case. What is
required is “appropriate” rather than “perfect” justice. The concept of “proportionality” is probably
as good as we are able to do in terms of identifying a relevant qualification. We simply have to stop
killing litigants with kindness.
There are, of course, a significant number of cases which conclude with an identifiable dollar
amount. Not all cases are like that but a substantial proportion are. It is at least theoretically possible to
adopt rules, which must necessarily be flexible because of the contingencies of the litigation process,
that operate as a default in such a manner as to control the costs recoverable by reference to the
amount ultimately awarded. This is a matter that can be done in the exercise of the discretion to
award costs.
I am not directing attention to the costs chargeable to the client. I am referring to costs awarded
to a successful litigant. The objective is to create cost incentives for parties to narrow the scope of
disputation and to make serious attempts to settle, in the same way as the regime that has already
[3.50]
121
Civil Procedure in New South Wales
Access to Justice and Access to Lawyers cont.
been developed for recognising offers of compromise, including by way of indemnity costs, creates
such incentives.
There may be a case for adopting, perhaps arbitrary but definite, amounts or proportions of an
award to be recovered as costs, by way of a table or formula which gives results capable of being
computed in advance [see eg Bret Walker “Proportionality and Cost Shifting” (2004) 27 UNSWLJ 214].
There may also be a role for identifying, in a separate way, proportionate recovery for matters of
particular significance in specific areas of jurisdiction, such as the costs of discovery in commercial
litigation.
Plainly there is a range of relevant considerations which can qualify the effect of any presumptive
rules that are developed in this respect. The exercise of a discretion can be affected by the manner in
which parties conduct proceedings, such as the extent of discovery upon which one party may have
insisted, or the degree to which a party has made a serious effort to confine the issues and other such
matters.
It is, however, essential to ensure that we do not excite a wave of satellite litigation. Disputes
about such matters have to be decided quickly and without excessive refinement. The English
experience is salutary in this respect. The attempt to control and regulate proceedings by means of
costs sanctions has spawned an enormous amount of disputation. This can only be controlled by
summary disposition.
There has been a growing literature on proportionality and many minds have been applied to
this issue. The process of adaptation is underway, but without any definite resolution. Nevertheless,
proportionality must be pursued as a matter of priority. If the legal profession does not do so, it is
quite likely that the resolution of the issues will simply be taken out of its hands as has happened in
other areas of practice.
To the extent that the legal profession does not succeed in achieving the objective of proportionality,
then it is likely that more areas of disputation will simply be taken away from legal decision-​making
processes. Over recent decades there have been a number of major changes, notably in personal
injury litigation, which have been driven to a substantial degree by what had come to be regarded
as an unacceptable proportion of compensation awards that were taken up by the decision-​making
process. This has sometimes taken the form of no fault liability schemes. On other occasions it has
taken the form of detailed requirements, including the exhaustion of alternative dispute resolution
mechanisms, prior to the institution of proceedings. On other occasions it has taken the form of
substituting comparatively informal arbitral mechanisms for the more formal hearing process of court
adjudication.
No one should be at all sanguine that this kind of intervention will be limited to personal injury
cases reflected in what had come to be regarded as an unacceptably higher level of insurance
premiums borne by the community. Such a reaction is capable of being implemented in any area of
legal disputation.
For example, I know that concern has been expressed about the costs of many Family Provision
Act disputes, which appear to consume a significant proportion of the assets to be distributed.
Similarly, in the area of commercial disputation, the costs of discovery are more than the commercial
community is likely to tolerate. When senior partners of a law firm tell me, as they have, that for any
significant commercial dispute the flag-​fall for discovery is often $2 million, the position is simply
not sustainable.

[3.55] Costs that are out of proportion to the importance and complexity of the subject
matter in despite have been found to be tantamount to an abuse of process, warranting a
permanent stay of proceedings.
122
[3.55]
Costs of Litigation
Chapter 3
Bleyer v Google Inc
[3.57] Bleyer v Google Inc [2014] NSWSC 897
MCCALLUM J
[1]‌ HER HONOUR: These proceedings raise an interesting question as to the Court’s authority to
decline to determine a civil claim on the grounds of disproportionality between the cost of doing so
and the interest at stake.
[2]‌The claim is an action in defamation brought by Mr Roland Bleyer against Google Inc, the
American company that provides the search engine known as Google. Mr Bleyer alleges that Google
Inc published seven items defamatory of him to three people in the form of Google search results
(in each case presumably in response to a Google search undertaken by each of those three people).
[3]‌By notice of motion filed 4 September 2013, Google Inc seeks an order that the proceedings
be permanently stayed or alternatively summarily dismissed as an abuse of process. This judgment
determines that application.
…
[49] The obvious starting point in determining that issue is to consider the relevant provisions
of the Civil Procedure Act 2005 and the Uniform Civil Procedure Rules 2005. The defendant’s notice
of motion seeks an order that the proceedings be permanently stayed pursuant to s 67 of the Civil
Procedure Act, which confers a general power, subject to rules of court, to stay any proceedings before
the court. …
[51] Can it seriously be doubted that the power conferred by s 67 can properly be exercised to
stay proceedings in which the resources required of the court and the parties to determine the claim
are vastly disproportionate to the interest at stake? That appears to be the position taken on behalf
of Mr Bleyer. It was noted on his behalf that the principle of proportionality is expressly part of the
overriding objective of the English Civil Procedure Rules, stated in clause 1.1 as follows:
[English Civil Procedure Rules extracted]
[52] Mr. Smark [SC, counsel for plaintiff] noted that no principle in equivalent terms is expressly
stated to be an aspect of the overriding purpose of the New South Wales Civil Procedure Act. Section
56 of the Act provides:
[Section 56 extracted]
[53] The only express reference to proportionality is in s 60 of the Act, which provides:
60 Proportionality of costs
In any proceedings, the practice and procedure of the court should be implemented with the
object of resolving the issues between the parties in such a way that the cost to the parties is
proportionate to the importance and complexity of the subject-​matter in dispute.
[54] Google Inc cited a number of decisions in which it has been said that, notwithstanding differences
in language between the provisions in the two jurisdictions, the provisions of sections 56 to 58 of
the Civil Procedure Act and r 1.1 of the English Civil Procedure Rules are substantially the same: Delta
Electricity v Blue Mountains Conservation Society Inc [2010] NSWCA 262; Habib v Radio 2UE Sydney Pty
Ltd [2009] NSWCA 231; Owners Corporation –​Strata Plan 61732 v TR Druce Pty Ltd [2009] NSWSC
1024; Ritchie’s Uniform Civil Procedure NSW at [60.15].
[55] However, Mr Smark noted that none of those authorities states that the express principle of
proportionality in the English Rules is also contained (by implication) within s 56 of the New South
Wales Civil Procedure Act.
[56] It is not, of course, a question of concluding that, noting the provisions of the English rules,
the New South Wales Parliament decided expressly to exclude such a principle. As submitted by
Mr McClintock [SC, counsel for defendant], as instructive as it is to consider the law of England, it is
[3.57]
123
Civil Procedure in New South Wales
Bleyer v Google Inc cont.
not necessary to resort to that body of law in order to determine what is an abuse of the process of this
Court. Sections 56 and 60 of the Civil Procedure Act are not to be read disjunctively. Further, there is
ample authority in this jurisdiction for the proposition (for which no authority is needed in any event)
that the just allocation of the finite resources of the court is a relevant consideration in the exercise of
the court’s authority, at least in civil matters.
[57] Once it is recognised that proportionality between the resources required to determine a
claim and the interest at stake is relevant to the exercise of the court’s procedural powers, it is a
small and logical step to conclude that there will be cases in which the disproportion is so vast as to
warrant the stay or dismissal of the proceedings. The converse proposition, that the court must always
determine every claim on the merits, is expressly rejected by [the summary dismissal provisions in]
r 13.4 of the UCPR. …
[61] I accept, as suggested by Mr Smark, that the court should be slow to shut its doors on a
plaintiff who has regularly invoked its jurisdiction, but in a sense that begs the question. Google’s
contention is that the principle of proportionality is a norm of justice which informs the question
whether the court’s jurisdiction has been regularly invoked.
[62] I am satisfied that the court has power, in an appropriate case, to stay or dismiss an action on
the grounds that the resources of the court and the parties that will have to be expended to determine
the claim are out of all proportion to the interest at stake. In my view, such disproportionality can
properly be regarded as a species of abuse of process.
[63] It should go without saying that the cases in which a stay would be granted on the basis
of disproportionality will be rare. The primary function of the court is to determine causes properly
brought before it according to law and the merits of the case. Further, the value of the interest at
stake will, at least in some instances, have to be assessed having regard to broader considerations
than the sum of money involved. That is an important consideration in the context of defamation,
where vindication of reputation is not wholly measured or achieved in financial terms, even though
the remedy must be given in the form of monetary compensation. Undoubtedly, like considerations
will arise in other kinds of cases.

[3.60] The concept of proportionality of costs in the CPA s 60 can influence the procedural
demands that the court places on the parties.
Zanella v Madden
[3.70] Zanella v Madden [2007] NSWSC 559
YOUNG CJ IN EQ
[1]‌This is an application in respect of joint tenancy of a property at Glen Davis. The property is
Torrens System land which is registered in the name of the plaintiff and the defendant as joint tenants.
The problem is that the plaintiff now wishes to realise the land, but she has not heard of the defendant
for many, many years.
[2]‌The evidence from the plaintiff is to the effect that she has paid the majority of the purchase
money by paying out the mortgage and that the defendant said to her when their relationship ceased
about 25 years ago that she could have the property, but nothing was done about it to formalise that
arrangement.
[3]‌The evidence shows that no-​one has seen or heard from the defendant since about 1980.
The problem is that he came from Scotland originally and he may well have gone back to Scotland,
but the plaintiff just does not know sufficient about his relations in Scotland to be able to make
meaningful enquiries.
124
[3.60]
Costs of Litigation
Chapter 3
Zanella v Madden cont.
[4]‌The defendant was a university lecturer in the School of Spanish at the University of
New South Wales. The plaintiff has made enquiries through universities and has made an Internet
search of American and British universities and has not been able to trace the defendant.
[5]‌The property at Glen Davis is said to be worth about $150,000 and the defendant’s interest is
a quarter, so that its value would be about $37,500. Section 56 of the Civil Procedure Act 2005 says
that the overriding purpose of the Act and the Rules is to facilitate the just, quick and cheap resolution
of the real issues in the proceedings, and that the court must seek to give effect to the overriding
purpose when it exercises any power given to it under any Act.
[6]‌The thrust of the application was that an order be made under s 21C of the Protected Estates Act
1983 which permits the court, where there is a missing person, to appoint a manager of the missing
person’s estate and for the property to be dealt with and the resulting fund preserved. There is a
backup application under section 66G of the Conveyancing Act 1919.
[7]‌However, it seems to me that the balance of probabilities strongly favours the fact that the
defendant is dead. He was a person who was over-​addicted to alcohol. He lost his position in New
South Wales, it would seem, over that. He has apparently not been hired by any overseas university.
He would now be 63. He has not been heard of by his friends or anybody whom the plaintiff suspects
might know him for over 20 years. He has taken no interest in his property here.
[8]‌It may well be that in past times one would have organised advertisements in Scotland, but,
when one is dealing with an estate of $37,500, bearing in mind s 56 of the Civil Procedure Act, the
cost of doing so is proportionately too great. It seems to me that on the evidence before me there is
sufficient material to show that the court can declare that the defendant is dead.
[9]‌As I said in Grieve v The Registrar General (NSW) (1997) 8 BPR 15,729, it is the Registrar General
who must be satisfied under s 101 of the Real Property Act 1900 that a person is dead so that a notice
of death can be filed and registered. It would seem to me that the Registrar General, although not
a party to these proceedings, would be justified in taking notice of this declaration of the court,
however, in case there is some difficulty, I will give liberty to apply.
[10] Accordingly, the court declares that the defendant is dead and gives liberty to apply on two
days’ notice.

THE PURPOSE OF COSTS
[3.100] Costs are only intended to compensate the successful party for the solicitor’s
professional costs and disbursements (which includes any barristers’ fees) in conducting the
case. Costs do not compensate the litigant for lost time or travel expenses, and they are not
awarded as a dividend or as punishment. However, costs can be used as an encouragement
to comply with the rules or any judgment or order. For example, UCPR r 42.10 provides the
court with power to order a party who fails to comply with the rules or any order of the court,
to pay such of the other parties’ costs as are occasioned by the failure. However, as the New
South Wales Court of Appeal made clear in Dr Bronte Douglass v Lawton Pty Ltd (No 2)
[2007] NSWCA 90, an order for the payment of an opponent’s costs that is expressed to be
“punishment” must amount to actual punishment before it will be overturned on appeal. Costs
can also be a mechanism to encourage settlement: see Offers of Compromise and Calderbank
letters discussed in Chapter 15.
[3.100]
125
Civil Procedure in New South Wales
The High Court, in Northern Territory v Sangare, has articulated the essential purposes for
costs orders in Australia. The judgment extracted is in the context of costs orders made by
courts in the Northern Territory, but the principles are equally applicable in New South Wales.
Northern Territory v Sangare
[3.110] Northern Territory v Sangare [2019] HCA 25
[The respondent, Sangare, was a citizen of Guinea who had arrived in Australia in 2011. He
applied for a protection visa under the Migration Act 1958 (Cth), but that application was refused.
In 2014, the respondent was employed by the Northern Territory Department of Infrastructure (the
“Department”), which offered to sponsor him as a skilled migrant, requiring him to apply for and
obtain an appropriate visa. The respondent received advice from the Commonwealth Government
that his application for the visa was invalid because the respondent had previously applied for and
been refused the protection visa. The respondent subsequently sought expressions of support
from the Minister of the Department, who in turn requested that officers of the Department brief
him about the respondent. The Chief Executive of the Department provided the brief, which the
respondent alleged contained defamatory material, including material that had been fabricated to
suggest the respondent had provided false and misleading information about his immigration status.
The respondent brought proceedings against the Northern Territory.
The Supreme Court of the Northern Territory dismissed the claims, based on application of
protections in the Defamation Act 2006 (NT) and the defence of qualified immunity, and a subsequent
appeal was unsuccessful. The Northern Territory applied for a costs order covering the costs of the trial
and appeal. That order was refused, primarily on the basis that the respondent would not have the
money to satisfy the costs order, so any order made would be futile.]
KIEFEL CJ, BELL, GAGELER, KEANA AND NETTLE JJ
The discretion as to costs
[24] It is well established that the power to award costs is a discretionary power, but that it is a
power that must be exercised judicially, by reference only to considerations relevant to its exercise
and upon facts connected with or leading up to the litigation[18]. While the width of the discretion
“cannot be narrowed by a legal rule devised by the court to control its exercise”[19], the formulation
of principles according to which the discretion should be exercised does not “constitute a fetter upon
the discretion not intended by the legislature”[20]. Rather, the formulation of principles to guide the
exercise of the discretion avoids arbitrariness and serves the need for consistency that is an essential
aspect of the exercise of judicial power[21].
[25] A guiding principle by reference to which the discretion is to be exercised –​indeed, “one of the
most, if not the most, important” principle –​is that the successful party is generally entitled to his or her
costs by way of indemnity against the expense of litigation that should not, in justice, have been visited
upon that party[22]. The application of that principle may be modified or displaced where there is conduct
on the part of the successful party in relation to the conduct of the litigation that would justify a different
outcome. For example, a successful defendant may be refused its costs on the ground that its conduct
induced the plaintiff to believe that he or she had a good cause of action[23]. But in the present case,
there was nothing of this kind in the conduct of the appellant in relation to the litigation that might have
weighed against the exercise of the discretion in its favour[24]. There was no suggestion of any conduct on
the part of the appellant, whether by unreasonable delay or a want of the cooperation required of litigants
to ensure the “just resolution of the real issues in civil proceedings with minimum delay and expense”[25],
that might have been taken into account to justify refusing the appellant an order for its costs.
Impecuniosity
…
[30] The [court appointed] amicus submitted that orders for costs are intended to be compensatory,
not punitive. As a general proposition, so much must be accepted[32]. The amicus went on to submit
126
[3.110]
Costs of Litigation
Chapter 3
Northern Territory v Sangare cont.
that the respondent’s impecuniosity was a consequence of his being unemployed and that this
followed the publication of the defamatory matter in respect of which the respondent brought these
proceedings. It was then argued that the effect of a costs order in these circumstances would not be
compensatory, but punitive.
[31] This submission cannot be accepted. The very point decided by the Court of Appeal was that
the respondent’s action was not justified in law. In these circumstances, there can be nothing punitive
in an order that the appellant be compensated for having been unsuccessfully sued. No conduct
on the part of the appellant in the course of the litigation caused or contributed in any way to the
respondent’s impecuniosity.
[32] Whether a party is rich or poor has, generally speaking, no relevant connection with the
litigation[33]. It may be said, by way of qualification to that general proposition, that a party’s financial
position may be relevant to the extent that it may inform the structure of a costs order. For example,
impecuniosity may justify providing for the payment of costs over time in order to avoid inflicting
unnecessary hardship while at the same time improving the likelihood of compliance with the order.
That said, any such qualification was not invoked in the present case. …
[35] [A]‌s a matter of authority, the courts have consistently rejected the suggestion that a costs
order should not be made against an impecunious party because it would be futile to do so[37]. The
circumstance that a person may not presently, or even foreseeably, be able to meet an order for costs
has not been regarded as a reason to regard the creation of the debt as an exercise in futility. The very
existence of the debt created by the order is a benefit to a creditor. The successful party is better off
with the benefit of the order than without it. It simply cannot be assumed that the respondent will
never have the means to pay the debt in whole or in part or that it might not otherwise be turned to
valuable account by the appellant[38].
Conclusion and orders
[36] The respondent’s impecuniosity was the only reason identified by the Court of Appeal for
depriving the appellant of its costs. That consideration was not relevant to the proper exercise of the
Court’s discretion as to costs. The Court of Appeal’s decision cannot be supported as an exception to
the general principle that a wholly successful party should be entitled to an order for costs. It follows
that the appeal must be allowed.
The appeal should be allowed. The respondent should pay the appellant’s costs of and incidental
to the proceedings in the Supreme Court of the Northern Territory at first instance and in the Court of
Appeal. The respondent should pay the appellant’s costs of the appeal to this Court.
Donald Campbell & Co v Pollak [1927] AC 732 at 811-​812; Latoudis v Casey [1990] HCA 59; (1990) 170
CLR 534 at 539-​540, 557, 561-​562, 569; Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR
72 at 96 [65], 120-​121 [134].
[18]
[19]
Norbis v Norbis [1986] HCA 17; (1986) 161 CLR 513 at 537; [1986] HCA 17. See also at 533.
Latoudis v Casey [1990] HCA 59; (1990) 170 CLR 534 at 541-​542, see also at 558-​559; Oshlack v Richmond
River Council [1998] HCA 11; (1998) 193 CLR 72 at 96 [65], 121 [134].
[20]
Norbis v Norbis [1986] HCA 17; (1986) 161 CLR 513 at 519; Latoudis v Casey [1990] HCA 59; (1990) 170
CLR 534 at 541-​542, see also at 558; Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72
at 96 [65], 121 [134].
[21]
Smeaton Hanscomb & Co Ltd v Sassoon I Setty, Son & Co [No 2] [1953] 1 WLR 1481 at 1484; [1953] 2
All ER 1588 at 1590. See also Harold v Smith [1860] EngR 516; (1860) 5 H & N 381 at 385 [157 ER 1229
at 1231]; Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72 at 96-​97 [66]-​[67], see also
at 86 [35], 120-​121 [134].
[22]
See, eg, Bostock v Ramsey Urban District Council [1900] 2 QB 616 at 622, 625, 627; Ritter v Godfrey [1920]
2 KB 47 at 53, 60, 66; Scottish Gympie Gold Mines Ltd v Carroll [1902] St R Qd 311 at 315-​316; Stewart v
Moore [1921] St R Qd 182 at 190; Redden v Chapman [1949] NSWStRp 28; (1949) 50 SR (NSW) 24 at 25.
[23]
[3.110]
127
Civil Procedure in New South Wales
Northern Territory v Sangare cont.
Anglo-​Cyprian Trade Agencies Ltd v Paphos Wine Industries Ltd [1951] 1 All ER 873 at 874; Oshlack v
Richmond River Council [1998] HCA 11; (1998) 193 CLR 72 at 97-​98 [69].
[24]
Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175 at 210 [90]; [2009] HCA
27. See Supreme Court Rules 1970 (NSW), r 1.10.
[25]
Latoudis v Casey [1990] HCA 59; (1990) 170 CLR 534 at 543, 562-​563, 567; Oshlack v Richmond
River Council [1998] HCA 11; (1998) 193 CLR 72 at 75 [1]‌, 89 [44], 97 [67], 102 [80], 103-​104 [82],
121 [134].
[32]
Hollier v Australian Maritime Safety Authority [No 2] [1998] FCA 975 at 3; Scott v Secretary, Department of
Social Security [No 2] [2000] FCA 1450 at [4]‌; Board of Examiners v XY [2006] VSCA 190; (2006) 25 VAR 193
at 207-​208 [35], 209 [41]; Dal Pont, Law of Costs, 4th ed (2018) at [8.30].
[33]
[37]
See Selliah v Minister for Immigration and Multicultural Affairs [1998] FCA 469 at 4; MZARS v Minister for
Immigration and Border Protection [2017] FCA 177 at [36]-​[37]; Graham v Minister for Immigration and Border
Protection [No 2] [2018] FCA 1116 at [16]-​ [17].
Tozier v Hawkins (1885) 15 QBD 680; The Commonwealth v Mewett (1997) 191 CLR 471 at 535; [1997]
HCA 29.
[38]

DUTIES OF LITIGANTS AND COSTS
[3.120] The CPA provides that parties have a statutory duty to assist the court to further
the overriding purpose to facilitate the just, quick and cheap resolution of the real issues
in proceedings and, therefore, to participate in the court’s processes and to comply with
directions and orders: s 56(3). In addition, every legal practitioner has a statutory duty not
to cause his or her client to breach the client’s duty to assist the court: s 56(4). The court
can take into account any failure of these duties by legal practitioners when determining
cost orders.
Civil Procedure Act 2005 (NSW)
[3.130] Civil Procedure Act 2005 (NSW) s 56
Part 6 –​Case management and interlocutory matters
Division 1 –​Guiding principles
56 Overriding purpose
(cf SCR Pt 1 r 3)
(1)
The overriding purpose of this Act and of rules of court, in their application to civil
proceedings, is to facilitate the just, quick and cheap resolution of the real issues in the
proceedings.
(2)
The court must seek to give effect to the overriding purpose when it exercises any power given
to it by this Act or by rules of court and when it interprets any provision of this Act or of any
such rule.
(3)
A party to civil proceedings is under a duty to assist the court to further the overriding purpose
and, to that effect, to participate in the processes of the court and to comply with directions
and orders of the court.
128
[3.120]
Costs of Litigation
Chapter 3
Civil Procedure Act 2005 (NSW) cont.
(4)
A solicitor or barrister must not, by his or her conduct, cause his or her client to be put in
breach of the duty identified in subsection (3).
(5)
The court may take into account any failure to comply with subsection (3) or (4) in exercising
a discretion with respect to costs.

Priest v New South Wales
[3.140] Priest v New South Wales [2007] NSWSC 41
[In the extract below, Category 27 refers to a category of documents described as containing
reports of a police operation into the conduct of a former police assistant commissioner.]
JOHNSON J
Judgment (on outstanding discovery issue and costs)
On 28 November 2006, I delivered judgment (see Priest v State of New South Wales [2006] NSWSC
1281) with respect to a number of applications then on foot of an interlocutory nature as between the
parties. That judgment must itself be viewed against the background of an earlier judgment delivered
by me in January 2006 concerning (in some respects) related interlocutory issues (see Priest v State of
New South Wales [2006] NSWSC 12).
…
Proper Construction of Category 27
[25] Category 27 is in the terms referred to earlier in this judgment. The Defendant seeks to construe
that category as being a reference to a single report, that of Detective Inspector Cameron of
15 November 2002, with no other documents falling within the category. That submission is put on
the basis that there is only one Operation Retz report and, in the Defendant’s submission, that is a
complete response to Category 27.
[27] I approach this matter as one of construction of the meaning of the words in Category 27. It
is not a category that is confined to “a report”, being the final report of Detective Inspector Cameron
of November 2002. It is apparent on a reading of that report that it is not a freestanding and self-​
contained document. …
The Defendant’s Approach to the Application Concerning Category 27
…
[33] The Civil Procedure Act 2005 contains a number of provisions which are relevant to the present
application. Section 56 of that Act says that the overriding purpose of the Act, and the rules in their
application to civil proceedings, is to facilitate the just, quick and cheap resolution of the real issues
in the proceedings: s 56(1). The Court must seek to give effect to that overriding purpose when it
exercises any power given to it under the Act or by the rules: s 56(2). A party to civil proceedings is
under a duty to assist the Court to further that overriding purpose and, to that effect, to participate
in the processes of the Court and to comply with the directions and orders of the Court: s 56(3).
A solicitor or barrister must not, by his or her conduct, cause his or her client to be put in breach of the
duty identified in s 56(3): s 56(4). A Court may take into account any failure to comply with s 56(3)
or s 56(4) in exercising a discretion with respect to costs: s 56(5).
[34] In a sense, s 56 has the result that every litigant in civil proceedings in this Court is now a model
litigant. However, there is ample authority that governmental bodies, including the Commonwealth
of Australia or the State of New South Wales, ought be regarded as having model litigant obligations
extending in the past, at least, beyond those of private litigants. In this respect, see decisions such as
[3.140]
129
Civil Procedure in New South Wales
Priest v New South Wales cont.
Scott v Handley (1999) 58 ALD 373; Wodrow v Commonwealth of Australia (2003) 129 FCR 182; Badraie
v Commonwealth of Australia (2005) 195 FLR 119 at 135; [2005] NSWSC 1195 at paragraph 94.
[35] I am not satisfied, given the history that I have recited in this judgment, that the Defendant
has discharged its obligations under s 56 Civil Procedure Act 2005 or, indeed, under its model litigant
obligations with respect to the Category 27 issue.
[37] It seems to me there are real and significant issues remaining with respect to the discoverability
of these documents. The problem is that I am in no better position to resolve the application now than
I was on 28 November 2006. Indeed, I am in a worse position because 37 further boxes of documents,
which have not been examined by counsel for the Defendant and which are not the subject of any
evidence on the part of the Defendant beyond the fairly superficial affidavit of Mr McGillicuddy, now
lie in my control.
…
Costs
[41] I made clear in my judgment of 28 November 2006 (at paragraph 56) that whatever the outcome
of the Defendant’s application to withdraw Category 27 from the order for discovery, it may have to
bear the costs, bearing in mind the way in which the issue has arisen. I am satisfied, on the present
state of this application, that an order should be made against the Defendant with respect to costs.
I have in mind, in that regard, the provisions to which I have referred in s 56 Civil Procedure Act 2005,
and what I regard to be failures on the part of the Defendant to comply with its obligations to the
Court revealed in the approach to this litigation to date.
[42] Section 98 Civil Procedure Act 2005 provides that costs are in the discretion of the Court.
Costs may be ordered on an ordinary basis or on an indemnity basis. In my view, the approach of the
Defendant to this application to date, and to compliance with orders of the Court, is such that there
has not been just, quick and cheap resolution of the issues falling for determination. Indeed, there
has been a continuing inability of the Court to discharge its functions because the Defendant has not
complied with its obligations. I am satisfied, in the circumstances, that the history of this application
to date is such that it is appropriate, in the exercise of discretion, to order that the Defendant pay the
costs of the Plaintiff on an indemnity basis with respect to the Category 27 discovery issue.
[3.150] Section 98 of the CPA provides the court with unlimited power to determine costs in a
proceeding. The power is discretionary and subject to the rules of court. As we will see, s 98 and the
rules of court (in particular UCPR Pt 42) affect all aspects of awards of costs by the court. However,
it should be noted that unless the court makes an order, a party is not entitled to recover costs from
any other party: see s 98(2).

Civil Procedure Act 2005 (NSW)
[3.160] Civil Procedure Act 2005 (NSW) s 98
Part 7 Judgments and orders
Division 2 Costs of Proceedings
98 Courts powers as to costs
(cf Act No 52 1970, s 76; SCR Pt 52A rr 5, 6, 7 and 8; Act No 9 1973, s 148B; Act No 11 1970, s 34)
(1)
130
Subject to rules of court and to this or any other Act:
[3.150]
Costs of Litigation
Chapter 3
Civil Procedure Act 2005 (NSW) cont.
(a)
costs are in the discretion of the court, and
(b)
the court has full power to determine by whom, to whom and to what extent costs are
to be paid, and
(c)
the court may order that costs are to be awarded on the ordinary basis or on an
indemnity basis.
(2)
Subject to rules of court and to this or any other Act, a party to proceedings may not recover
costs from any other party otherwise than pursuant to an order of the court.
(3)
An order as to costs may be made by the court at any stage of the proceedings or after the
conclusion of the proceedings.
(4)
In particular, at any time before costs are referred for assessment, the court may make an order
to the effect that the party to whom costs are to be paid is to be entitled to:
(a)
costs up to, or from, a specified stage of the proceedings, or
(b)
a specified proportion of the assessed costs, or
(c)
a specified gross sum instead of assessed costs, or
(d)
such proportion of the assessed costs as does not exceed a specified amount.

PARTIES AND COSTS
[3.170] In 2005, Hamilton J4 said:
Costs are dealt with in CPA Part 7 Div 2 and UCPR Part 42. … An attempt has been made
to rationalise a confusion in terminology, which has arisen in respect of costs. Prior to 1987
the two principal bases for the quantification of costs were called the party and party basis
and the (more ample) solicitor and client basis. After the enactment of the LPA 1987, the
more ample basis came to be called the indemnity basis. Furthermore, “party/​party” and
“solicitor/​client” came to have a new meaning under that legislation as referring respectively
to assessments of costs under court orders and assessments of costs between solicitor and
client. These expressions referred (and refer) to the parties between whom the assessment took
place, rather than to the basis of quantification. Courts, however, go on making reference to
“party and party” costs as the lower basis of quantification. An attempt has been made to
remove this anomaly by defining the lower basis of quantification as the “ordinary basis”, so
that “party/​party” will be left to refer only to the identification of persons between whom an
assessment under the LPA 1987 or the LPA 2004 is taking place. See CPA s 3(1). This is very
logical but, in the face of the ingrained conservatism of lawyers in the use of language, I do
not know how it will fare.
Uniform law costs
[3.180] The professional fee a client is required to pay is dictated by the contract or costs
agreement between the solicitor and client. The fee together with disbursements amount to
what are called “uniform law costs” (previously known as “client and practitioner costs” or
“solicitor and client costs”), and are amounts which the client is liable to pay, whether or
4
Hamilton JP, The New Procedure Nuts and Bolts for Judicial Officers, Judicial Commission of NSW
(16 August 2005).
[3.180]
131
Civil Procedure in New South Wales
not the client is awarded “ordered costs” (previously known as “party and party costs”). Put
another way, they are the costs that the lawyer charges the client. Note that a client may seek
to have the court in which the litigation took place, or an independent costs assessor, assess
the costs payable to the solicitor. If a court sets aside the costs agreement, the court may
nevertheless order the payment of a different amount to the solicitor, such as one based on
the court’s scale of costs. Note also that the client is not liable to pay such costs if the lawyer
agrees to act on a “no win no fee” basis, unless the agreement with the solicitor includes a
provision for payment of a success fee or “uplift fee”.
Solicitor and client costs that are determined by a costs agreement entered into prior
to 1 July 2015 are subject to assessment under the Legal Profession Act 2004 (NSW) and
any assessment processes in its regulations that were extant at that time. However, uniform
law costs in respect of proceedings that commenced on or after 1 July 2015 are subject to
assessment processes under the Legal Profession Uniform Law and its regulations: Legal
Profession Uniform Law (NSW) Sch 4 cl 18.
Ordered costs
[3.190] Ordered costs (previously known as “party and party costs”) are the costs the court
usually orders one party to pay to another party in litigation. Uniform law costs or client and
practitioner costs are often greater than ordered costs, so ordered costs usually only partially
indemnify5 the client recipient against the costs that the client is contractually obligated to pay
to his or her solicitor.
Ordered costs are those costs that the court considers appropriate and reasonable for the
successful party to receive in order to be compensated for the cost of achieving the outcome
of the litigation. They can be awarded on an ordinary basis or an indemnity basis (which is a
more generous costs scale). Costs awarded on an indemnity basis allow for all costs incurred,
except those that appear to have been unreasonably incurred or those that appear to be an
unreasonable amount: UCPR r 42.5.
The court must specify if costs are awarded on an indemnity basis. If the costs basis is
not specified by the court order, the costs are generally assessed on an ordinary basis: UCPR
r 42.2.
Parties that receive, or are ordered to pay, an unquantified costs order are entitled to apply
for an assessment or taxation of costs. In New South Wales, taxation or assessment of party
and party costs for proceedings that commenced prior to 1 July 2015 are still governed by the
Legal Profession Act 2004 (NSW) and any assessment processes in its regulations that were
extant at that time. However, ordered costs in respect of proceedings that commenced on or
after 1 July 2015 are subject to assessment processes under the Legal Profession Uniform
Law and its regulations: Legal Profession Uniform Law Application Regulation 2015 (NSW),
reg 59.
Costs assessments processes for matters commenced on or after 1 July 2015 are governed
by the Legal Profession Uniform Law Application Regulation 2015 (NSW), Pt 6 “Legal
Costs –​ Costs Assessment”.
5
Latoudis v Casey (1990) 170 CLR 534; Cachia v Hanes (1994) 179 CLR 403.
132
[3.190]
Costs of Litigation
Chapter 3
Costs follow the event –​the usual costs order
[3.200] Costs are at the discretion of the court and this is specified in s 98(1)(a) of the CPA.
UCPR r 42.1 recognises the general law presumption6 that unless it appears to the court that
some other order should be made, costs follow the event. Such an order acknowledges that a
successful party has a “reasonable expectation” of being awarded costs against the unsuccessful
party7 and that fairness dictates that the unsuccessful party usually has the liability for costs.8
Baulderstone Hornibrook Engineering v Gordian Runoff
[3.210] Baulderstone Hornibrook Engineering Pty Ltd v Gordian Runoff Ltd [2006] NSWSC 583
EINSTEIN J
Costs
The Civil Procedure Act 2005
…
[5]‌Section 56(1) obliges the parties to conduct proceedings in a way which would facilitate the
just, quick and cheap resolution of the real issues in the proceedings.
[6]‌The significance of s 56 to conduct in the commercial list was explained by Bergin J in A and N
Holdings NSW Pty Limited v Andell Pty Limited [2006] NSWSC 55 (para 24) where her Honour described
the Commercial List as a “fast track for litigation”.
[7]‌Section 56 is a statutory enactment of the principles which have long applied to the conduct of
commercial litigation (such as this case) in this State: Tripple Take Pty Limited v Clark Rubber Franchising
Pty Limited [2005] NSWSC 1169.
[8]‌Section 56 gives effect to Mahoney P’s observation that litigation is not a game. The section
requires litigants at the risk of costs orders to concentrate on the real issues. A party may no longer put
another to the proof of a fact which the first knows is true without a costs penalty where the party put
to proof establishes the fact. The “fast track” of which Bergin J spoke should not stop once a plaintiff
succeeds in having the hearing begin.
General approach
The usual order
[9]‌The usual order is that costs follow the event (although there is no absolute rule to that effect):
Oshlack v Richmond River Council (1998) 193 CLR 72, per McHugh J at [63]–​[67]. The position will be
otherwise if “it appears to the Court that some other order ought be made as to the whole or any part
of the costs”: Credit Lyonnais Australia Limited v Darling (1991) 5 ACSR 703 at 710 per Kirby P.
Apportionment
[10] The effect of UCPR Part 42 r 42.1 is that an unsuccessful party may be ordered to pay the entirety
of the costs of a successful party, even though the successful party did not succeed on all issues.
Special circumstances are generally required to justify some other order being made.
[11] Unless a particular issue or group of issues is clearly dominant or separable it will ordinarily
be appropriate to award the costs of the proceedings to the successful party without attempting
to differentiate between those particular issues on which it was successful and those in which it
6
7
8
Ritter v Godfrey [1920] KB 47; Dodds Family Investments Pty Ltd (formerly Solar Tint Pty Ltd v Lane Industries
Pty Ltd) (1993) 26 IPR 261.
See Oshlack v Richmond River Council (1998) 193 CLR 72; 72 ALJR 578; 152 ALR 83; [1998] HCA 11 at [34].
Oshlack v Richmond River Council (1998) 193 CLR 72; 72 ALJR 578; 152 ALR 83; [1998] HCA 11 at [67].
[3.210]
133
Civil Procedure in New South Wales
Baulderstone Hornibrook Engineering v Gordian Runoff cont.
failed: Waters v PC Henderson (Aust) Pty Ltd (unreported, Supreme Court of New South Wales Court of
Appeal, Kirby P, Mahoney JA, Priestley JA, 6 July 1994, BC 9404952).
[12] Whilst the general principle is that an ultimately successful party ought not be put at risk as
to costs merely by having relied upon additional issues upon which it did not succeed (on the basis
that the ultimate ends of justice may not be served if a party is dissuaded by the risk of costs from
canvassing all issues which might be material to the decision in the case), a successful party may only
get a proportion of its costs if the unsuccessful party is able to identify clearly dominant or separable
issues lost by the successful party.
Multiple parties
[13] The Court will not normally allow more than one set of costs to successful litigants where there
was no possible conflict of interest between them in the presentation of their cases: Statham v Shephard
(No 2) (1974) 23 FLR 244. The matter was put as follows at 246, per Woodward J:
The principle which I deduce from these authorities, and which I believe I should follow
in spite of the two cases earlier cited, is that the court will not normally allow two sets of
costs to defendants where there is no possible conflict of interest between them in the
presentation of their cases. I would add to this basic proposition three provisos. In the first
place, if a conflict of interest appears possible but unlikely, the defendants should make
any necessary inquiries from the plaintiff as to the way in which his case is to be put if
this would resolve the possibility of conflict between defendants. (See In re Lyell [1941]
VLR 207.)
Secondly, there could be circumstances in which, although the defendants were united in their
opposition to the plaintiff, their relationship to each other might be such that they would be acting
reasonably in remaining at arm’s length during the general course of litigation.
Thirdly, even if defendants are acting reasonably in maintaining separate representation for some
time or for some purposes, they may still be deprived of part of their costs if they act unreasonably by
duplicating costs on any particular matter or at any particular time.
Indemnity costs
[14] The Court has power to award indemnity costs under s 98(1)(c) of the Act.
[15] The principles on which an indemnity costs order will be made, are well settled. The principles
established by Sheppard J in Colgate Palmolive Co v Cussons Pty Limited (1993) 46 FCR 225, 233 are
generally accepted.
[16] Recent applications of those principles in this Court are Lahoud v Lahoud [2006] NSWSC 126,
Campbell J; Stockland (Constructors) Pty Limited v Darryl I Coombs Pty Limited [2005] NSWSC 252,
and by the Court of Appeal in Gray v Gray [2005] NSWCA 129 para 18. In Gray, Colgate (supra) was
referred to as “the leading judgment”.
[17] The High Court in Oshlack at 89, 90 (Gaudron and Gummow JJ) recorded that indemnity costs
were appropriate where the case involved “some relevant delinquency on the part of the unsuccessful
party”: see the observations quoted by those Justices from the judgment of Malcolm CJ’s in Smith, Re;
ex parte Rundell (No 2) (1991) 6 WAR 299.
[18] The following factors include those listed by Sheppard J in Colgate Palmolive v Cussons (1993)
118 ALR 248, as accepted by the Court of Appeal in Leichhardt Municipal Council v Green [2004]
NSWCA 341 at [48], as of relevance to the present application:
• Evidence of particular misconduct that causes loss of time to the court and the other parties …
• The fact that the proceedings were commenced in willful disregard of known facts …;
• The making of allegations that ought never to have been made or the undue prolongation of a
case by groundless contentions;
134
[3.210]
Costs of Litigation
Chapter 3
Baulderstone Hornibrook Engineering v Gordian Runoff cont.
[It is to be noted that CGU has submitted, that for the purposes of Sheppard J’s para (a), an allegation
of bad faith may have a similar effect to an allegation of fraud.]
[19] Section 56(5) of the Act expands the circumstances in which an indemnity costs order may
be made.
[20] In order to establish a basis for an indemnity costs order, it is necessary to establish by
evidence relevant delinquency, abuse of process, ulterior purpose or unreasonableness on the part
of BHE.
[21] Evidence of unreasonable conduct on the part of the party ordered to pay costs is usually
required: Rosniak v Government Insurance Office (1997) 41 NSWLR 608 at 616 per Mason P.
[22] The difficulty or otherwise of the litigation cannot itself be the basis for the award of costs on a
special basis, as the courts are constantly engaged in complex litigation, and the fact that a particular
piece of litigation raises difficult questions of law necessitating elaborate preparation is not a novelty: cf,
Marks, Kinross, McCullagh & Williamson v GIO Australia Holdings Ltd (No 2) (1996) 66 FCR 128 at 141.
[23] The mere fact that a party fights the proceedings fiercely and that no stone is left unturned is
not a ground for a special costs order: cf, Australian Federation of Consumer Organisations Inc v Tobacco
Institute of Australia Ltd (1991) 100 ALR 568 at 570; Berkeley Administration Inc v McClelland [1990]
FSR 565 at 569–​570.
[24] The mere fact that a case has been found to lack merit cannot be a basis for a special costs
order, for in most litigation that comes to a concluded hearing, the claim of one of the parties will have
been found lacking in merit: cf, Hurstville Municipal Council v Connor (1991) 24 NSWLR 724 at 735.
[See the practical application of the above principles by Allsop J in DSE (Holdings) Pty Limited v
InterTan Inc [2004] FCA 1251 and on appeal InterTan Inc v DSE (Holdings) Pty Limited [2005] FCAFC 54.]
Prolonging a trial
[25] Prolonging a trial by litigating issues which are known to the unsuccessful party not to be real
issues, in breach of s 56 of the Act, is capable of constituting relevant delinquency. Section 56(5) would
in an appropriate case permit this form of delinquency to be taken into account in the Court’s exercise
of its discretion to award costs. Depending always upon the precise circumstances, the Court has
power to order indemnity costs against an unsuccessful party whose conduct has breached s 56: and
this in furtherance of the statutory object which the section embodies.
Interest
[26] The Court may order the payment of interest on the costs so awarded, such interest to be
payable as from the date or dates on which the costs in question were paid [s 101(5)(a) of the Act].
The principles are set out by Campbell J in Lahoud at para 78 ff. There is no requirement that the
Court be satisfied before making such an order that the case was out of the ordinary. The governing
consideration is to compensate a party which is out of pocket by having to pay costs.
A word of warning
[27] Gordian (the respondent) contended as follows:
i.
The Court is vigilant to ensure that successful parties who incur additional costs in litigating
issues which would not have been litigated had only the real issues in dispute been litigated,
should be effectively compensated for the costs incurred, otherwise an innocent party will bear
the costs of the wrongdoers’ delinquency.
ii.
Parties who choose not to litigate the real issues should do so at their own cost.
[28] These submissions may be accepted subject to an important rider, namely the need to accept
that in any particular set of proceedings the parties are of course entitled to, in good faith, determine
to litigate issues reasonably believed at the time to bear upon the real issues. The pendulum dictated
by the Act should not be seen as a mechanism to deny parties their entitlement to litigate issues
believed on proper grounds to be genuine issues even if, with the benefit of hindsight, the course of
[3.210]
135
Civil Procedure in New South Wales
Baulderstone Hornibrook Engineering v Gordian Runoff cont.
the evidence ultimately shows that the litigation of some of those issues may have been an incorrect
call. Prescience is a rare commodity, particularly where very complex litigation is in play.
[29] All of this simply serves to point up the instant specific nature of the principled exercise
of the discretion. There are cases and there are cases. The trial judge will usually be in the best
position to determine how the discretion should be exercised: cf Furber v Stacey [2005] NSWCA 242
at [126], [133].

LAWYERS AND COSTS
[3.220] The CPA and Sch 2 of the Legal Profession Uniform Law Application Act 2014
(NSW) (LPULAA) provide for costs to be ordered against a legal practitioner personally. These
powers are exercised in a context where the legal system remains adversarial. Nevertheless,
their existence and their periodic exercise can promote cultural change among practitioners.
It is to be noted that s 56(4) of the CPA provides a statutory duty on every legal practitioner
not to conduct him or herself so as to cause his or her client to breach the client’s duty to assist
the court. In addition, cl 2 of Sch 2 of the LPULAA requires a legal practitioner, before filing
a pleading, whether for a plaintiff or for a defendant, to certify that, “there are reasonable
grounds for believing on the basis of provable facts and a reasonably arguable view of the law”
that the claim or the defence has “reasonable prospects of success”. Costs sanctions in Sch 2
and s 99 of the CPA reinforce the traditional professional obligation of legal practitioners to
avoid the commencement or continuance of baseless proceedings.
Legislation of this nature raises two important and competing public interests. First, lawyers
should not be deterred from fearlessly pursuing the interests of their clients. Second, financial
prejudice occasioned by unjustified litigation should be discouraged. Hamilton J usefully
summarised the danger of making a costs order against a legal practitioner and the consequent
effect it might have on his or her perceived duty to their client in Pinebelt Pty Ltd v Bagley:9
[T]‌
here are grave dangers in the too ready imposition of personal costs orders against
practitioners … A feeling of threat of personal liability arising from decisions, some rivalling in
themselves and many necessarily taken in the sometimes white hot caldron of litigation, has the
potential to paralyse the decisive and fearless conduct which advocates are daily called upon
to engage in.
Practice Note SC Gen 5 Supreme Court –​Costs Orders against Legal Practitioners commenced
on 17 August 2005. Applying to new and existing civil proceedings in the Supreme Court, it
provides a procedure designed to facilitate fairness.
The practice note indicates that its purpose is to ensure compliance with directions and the
rules of the court and that practitioners have regard to the “speedy and efficient administration
of justice”. The practice note indicates that this will be confirmed by the use of costs sanctions
in appropriate cases, including costs orders against legal practitioners personally and costs
ordered on a payable forthwith basis. The court relies on legal practitioners, either directly or
by giving appropriate advice to a client, to attend to the following: observe listing procedures,
9
Pinebelt Pty Ltd v Bagley [2000] NSWSC 655 at [28].
136
[3.220]
Costs of Litigation
Chapter 3
rules and court directions; ensure readiness for trial; provide reasonable estimates of the
length of hearings; present written submissions on time; and give the earliest practicable
notice of an adjournment application. Failure in any of these respects may be taken into
account in exercising the jurisdiction to order costs against legal practitioners personally.
The late amendment of pleadings may also attract a costs order against a legal practitioner.
In appropriate cases, particularly those involving repeated defaults, the court may refer an
incident or incidents of default to the Law Society, Bar Association or the Office of the Legal
Services Commissioner.
According to the “Procedural considerations” of Practice Note SC Gen 5, the procedure
to be followed, where the court is minded to make a costs order against a legal practitioner
personally will be:
• A practitioner will be given an opportunity to show cause why costs should not be ordered
against him or her;
• With the consent of the practitioner, the court may take the show cause submission orally
at the conclusion of any trial, application or other appearance before the court;
• The court may adjourn the matter to another day or date to be fixed, and may direct
the practitioner to provide written submissions to the court within a period specified by
the court;
• The court may further direct that the matter proceed by written submission and by reference
primarily to the materials that were before the court during the proceedings to which the
costs order relates;
• If it will assist the court, the other parties to the proceedings may be directed or invited to
make submissions in relation to the question of costs or any ancillary matter;
• If a practitioner informs the court that he has requested his or her client to waive legal
professional privilege in a respect which the practitioner asserts is relevant to the court’s
consideration of the costs order, the court will invite the client to make submissions on the
matter and to indicate whether the client wishes an order to be made against the practitioner;
• Upon a determination by the court that a legal practitioner shall be personally liable for the
costs of a party to the proceedings or any part thereof and such costs are ordered to be payable
forthwith, the court may order that a bill of costs relevant to the costs order be filed with the
court and served on the party liable to pay within such time as the court orders and that such
a bill of costs be in the form prescribed pursuant to s 193 of the Legal Profession Act; and
• The judge or associate judge may determine and order the amount of costs payable under
the costs order.
Legal Profession Uniform Law Application Act 2014 (NSW)
[3.230] Legal Profession Uniform Law Application Act 2014 (NSW) Sch 2
Schedule 2 Costs in civil claims where no reasonable prospects of success
1 Application of Schedule
(1) Schedule extends to appeals
This Schedule extends to legal services in connection with proceedings in a court on appeal as well
as a court at first instance.
[3.230]
137
Civil Procedure in New South Wales
Legal Profession Uniform Law Application Act 2014 (NSW) cont.
(2) Legal services provided by both barrister and solicitor
If legal services in relation to a particular matter are provided by both a solicitor and a barrister
instructed by the solicitor, any function imposed by this Schedule on a law practice in respect of the
provision of the services is to be read as imposing the function on both the solicitor and barrister.
2 Law practice not to act unless there are reasonable prospects of success
(1)
A law practice must not provide legal services on a claim or defence of a claim for damages
unless a legal practitioner associate responsible for the provision of the services concerned
reasonably believes on the basis of provable facts and a reasonably arguable view of the law
that the claim or the defence (as appropriate) has reasonable prospects of success.
(2)
A fact is provable only if the associate reasonably believes that the material then available to
him or her provides a proper basis for alleging that fact.
(3)
This Schedule applies despite any obligation that a law practice or a legal practitioner associate
of the practice may have to act in accordance with the instructions or wishes of the client.
(4)
A claim has reasonable prospects of success if there are reasonable prospects of damages
being recovered on the claim. A defence has reasonable prospects of success if there are
reasonable prospects of the defence defeating the claim or leading to a reduction in the
damages recovered on the claim.
(5)
Provision of legal services in contravention of this clause constitutes for the purposes of this
Schedule the provision of legal services without reasonable prospects of success.
3 Preliminary legal work not affected
This Schedule does not apply to legal services provided as a preliminary matter for the purpose of
a proper and reasonable consideration of whether a claim or defence has reasonable prospects of
success.
4 Restrictions on commencing proceedings without reasonable prospects of success
(1)
The provision of legal services by a law practice without reasonable prospects of success
does not constitute an offence but is capable of being unsatisfactory professional conduct or
professional misconduct by a legal practitioner associate of the practice who is responsible for
the provision of the service or by a principal of the practice.
(2)
A law practice cannot file court documentation on a claim or defence of a claim for damages
unless a principal of the practice, or a legal practitioner associate responsible for the provision
of the legal service concerned, certifies that there are reasonable grounds for believing on the
basis of provable facts and a reasonably arguable view of the law that the claim or the defence
(as appropriate) has reasonable prospects of success.
(3)
Court documentation on a claim or defence of a claim for damages, which has been lodged
for filing, is not to be filed in a court or court registry unless accompanied by the certification
required by this clause. Rules of court may make provision for or with respect to the form of
that certification.
(4)
In this clause:
“court documentation” means:
(a)
an originating process (including for example, a statement of claim, summons or cross-​
claim), defence or further pleading, or
(b)
an amended originating process, defence or further pleading, or
(c)
a document amending an originating process, defence or further pleading, or
(d)
any other document of a kind prescribed by the local regulations.
“cross-​claim” includes counter-​claim and cross-​action.
138
[3.230]
Costs of Litigation
Chapter 3
Legal Profession Uniform Law Application Act 2014 (NSW) cont.
5 Costs order against law practice acting without reasonable prospects of success
(1)
(2)
(3)
(4)
If it appears to a court in which proceedings are taken on a claim for damages that a law
practice has provided legal services to a party without reasonable prospects of success, the
court may of its own motion or on the application of any party to the proceedings make either
or both of the following orders in respect of the practice or of a legal practitioner associate of
the practice responsible for providing the services:
(a)
an order directing the practice or associate to repay to the party to whom the services
were provided the whole or any part of the costs that the party has been ordered to
pay to any other party,
(b)
an order directing the practice or associate to indemnify any party other than the party
to whom the services were provided against the whole or any part of the costs payable
by the party indemnified.
The Supreme Court may on the application of any party to proceedings on a claim for damages
make any order that the court in which proceedings on the claim are taken could make under
this clause.
An application for an order under this clause cannot be made after a final determination has
been made under Part 7 by a costs assessor of the costs payable as a result of an order made
by the court in which the proceedings on the claim concerned were taken.
A law practice or legal practitioner associate of the practice is not entitled to demand, recover
or accept from a client any part of the amount for which the practice or associate is directed
to indemnify a party pursuant to an order under this clause.
6 Onus of showing facts provided reasonable prospects of success
(1)
(2)
(3)
(4)
If the court (the “trial court”) hearing proceedings on a claim for damages finds that the
facts established by the evidence before the court do not form a basis for a reasonable belief
that the claim or the defence had reasonable prospects of success, there is a presumption
for the purposes of this Schedule that legal services provided on the claim or the defence (as
appropriate) were provided without reasonable prospects of success.
If the Supreme Court (when the Supreme Court is not the trial court) is satisfied, either as
a result of a finding of the trial court or otherwise on the basis of the judgment of the trial
court, that the facts established by the evidence before the trial court do not form a basis for a
reasonable belief that the claim or the defence had reasonable prospects of success, there is a
presumption for the purposes of this Schedule that legal services provided on the claim or the
defence (as appropriate) were provided without reasonable prospects of success.
A presumption arising under this clause is rebuttable and a person seeking to rebut it bears
the onus of establishing that at the time legal services were provided there were provable
facts (as provided by clause 2 (Law practice not to act unless there are reasonable prospects of
success)) that provided a basis for a reasonable belief that the claim or the defence on which
they were provided had reasonable prospects of success.
A law practice or legal practitioner associate of the practice may, for the purpose of establishing
that at the time legal services were provided there were provable facts (as provided by clause 2
(Law practice not to act unless there are reasonable prospects of success)) that provided a
basis for a reasonable belief that the claim or the defence on which they were provided had
reasonable prospects of success, produce information or a document despite any duty of
confidentiality in respect of a communication between the law practice or a legal practitioner
associate of the practice and a client, but only if:
(a)
the client is the client to whom the legal services were provided or consents to its
disclosure, or
(b)
the court is satisfied that it is necessary for the law practice or associate to do so in
order to rebut a presumption arising under this clause.
[3.230]
139
Civil Procedure in New South Wales
Legal Profession Uniform Law Application Act 2014 (NSW) cont.
[3.240] Schedule 2 may be presumed to apply where legal services were supplied in a claim for
damages without reasonable prospects of success.10 A costs award pursuant to this provision could
require the legal practitioner to repay costs to a party who received the legal services in the proceedings
(the client) or indemnify any party other than the party to whom the services were provided against
costs payable by the indemnified party. The legal practitioner bears the onus of proving the facts to
support a reasonable belief that a claim or defence had reasonable prospects of success.
[3.250] Section 99 of the CPA also provides for costs to be ordered against a legal practitioner,
where costs have been incurred by reason of serious neglect, incompetence or impropriety. The New
South Wales Court of Appeal in Nadarajapillai v Naderasa (No 2) [2015] NSWCA 209 ordered that a
legal practitioner pay to the respondent in the appeal the amount of the costs that the appellant, his
client, was ordered to pay the respondent. Emmett JA (with McColl and Macfarlan JJA agreeing) in
that case said: “Section 99 is described as applying where costs have been incurred ‘by the serious
neglect, serious incompetence or serious misconduct of a legal practitioner’, or ‘improperly, or
without reasonable cause, in circumstances for which a legal practitioner is responsible’ … I consider
that the conduct of [the solicitor], in instituting and maintaining an appeal that had no prospects of
success, and no merit, constituted serious incompetence on his part as a legal practitioner and that
costs have been incurred improperly and without reasonable cause, in circumstances for which he is
responsible.”
Section 99 also specifically requires that the practitioner be given a reasonable opportunity to be
heard. For example, in Berry Rural Co Operative Society Ltd v Sepak Industries Pty Ltd [2018] NSWSC
298, Stevenson J, after finding that the plaintiff’s negative position in the litigation was “due, entirely,
to the egregious short comings in the manner in which its legal representatives have conducted [the]
proceedings,” gave the plaintiff’s solicitor 4 days to show cause in writing why “she should not pay to
the Co Operative the whole of the costs the Co Operative must pay Sepak; and why the costs thrown
away by the Co Operative’s failure to comply with the directions made in these proceedings should
not be disallowed as between [the solicitor] and the Co Operative.”

Civil Procedure Act 2005 (NSW)
[3.260] Civil Procedure Act 2005 (NSW) s 99
Part 7 Judgments and orders
Division 2 Costs of Proceedings
99 Liability of legal practitioner for unnecessary costs
(cf Act No 52 1970, s 76C; SCR Pt 52A rr 43 and 43A)
(1)
This section applies if it appears to the court that costs have been incurred:
(a)
by the serious neglect, serious incompetence or serious misconduct of a legal
practitioner, or
(b)
improperly, or without reasonable cause, in circumstances for which a legal practitioner
is responsible.
10
The former s 348 of the Legal Profession Act 2004 (NSW) did so apply. See Legg M and Fai M, “Litigation: Court
of Appeal Clarifies ‘Reasonable Prospects of Success’ ” (2005) 43(7) Law Society Journal (NSW) 55.
140
[3.240]
Costs of Litigation
Chapter 3
Civil Procedure Act 2005 (NSW) cont.
(2)
After giving the legal practitioner a reasonable opportunity to be heard, the court may do any
one or more of the following:
(a)
(b)
(c)
it may, by order, disallow the whole or any part of the costs in the proceedings:
(i)
in the case of a barrister, as between the barrister and the instructing solicitor,
or as between the barrister and the client, as the case requires, or
(ii)
in the case of a solicitor, as between the solicitor and the client,
it may, by order, direct the legal practitioner:
(i)
in the case of a barrister, to pay to the instructing solicitor or client, or both, the
whole or any part of any costs that the instructing solicitor or client, or both,
have been ordered to pay to any other person, whether or not the solicitor or
client has paid those costs, or
(ii)
in the case of a solicitor, to pay to the client the whole or any part of any costs
that the client has been ordered to pay to any other person, whether or not the
client has paid those costs,
it may, by order, direct the legal practitioner to indemnify any party (other than the
client) against costs payable by that party.

Treadwell v Hickey
[3.270] Treadwell v Hickey [2010] NSWSC 1119
[In unsuccessful proceedings brought by Treadwell against Hickey, the latter sought indemnity
costs and an order pursuant to s 348(1)(b) of the Legal Profession Act 2004 (NSW) (now superseded
by Schedule 2 of the Legal Profession Uniform Law Application Act 2014 (NSW)) or, alternatively, s 99(2)
(c) of the Civil Procedure Act 2005 (NSW) against Treadwell’s solicitor Fitzpatrick.]
BARRETT J
The claim against the solicitor
[16] The issue of whether a costs order should be made against Mr Fitzpatrick was the central issue in
the costs argument before me. I shall address it first.
[17] It is Mr Hickey’s contention that the case brought against him by Mr Treadwell was so lacking
in merit and substance so as to be not fairly arguable and that Mr Fitzpatrick’s view about prospects
of success did not have an objective foundation in the material available to him at the relevant time.
Alternatively, it is submitted that if Mr Fitzpatrick did in fact believe that there was material which
objectively justified proceeding with the case that belief fell outside the range of views which could
be reasonably entertained.
[18] The claim against Mr Fitzpatrick is made under s 348(1)(b) of the Legal Profession Act 2004
and s 99(2)(c) of the Civil Procedure Act 2005. Although the sections are framed differently and require
separate consideration, there are a number of principles with equal application to each section.
[19] In Lemoto v Able Technical Pty Ltd [2005] NSWCA 153; (2005) 63 NSWLR 300, McColl JA set
out at [92] a number of guiding principles which the court will take into consideration when exercising
a power to order a legal practitioner to pay the costs of proceedings in which the practitioner has
represented a party:
(a)
The jurisdiction to order a legal practitioner to pay the costs of legal proceedings in respect of
which he or she provided legal services must be exercised “with care and discretion and only
in clear cases”: Ridehalgh (at 229); Re Bendeich (No 2) (1994) 53 FCR 422; Deputy Commissioner
[3.270]
141
Civil Procedure in New South Wales
Treadwell v Hickey cont.
of Taxation v Levick (1999) 168 ALR 383 at 389 [11]; 43 ATR 621 at 627 [11], per Hill J; Levick v
Commissioner of Taxation (2000) 102 FCR 155 at 166 [44]; Gitsham v Suncorp Metway Insurance
Ltd [2002] QCA 416 at [8]‌, per White J (with whom Davies JA and Williams JA agreed); De
Sousa v Minister for Immigration, Local Government and Ethnic Affairs (1993) 41 FCR 544; Money
Tree Management Services Pty Ltd and Institute of Taxation Research v Deputy Commissioner of
Taxation (No 3) (2000) 45 ATR 262;
(b)
A legal representative is not to be held to have acted improperly, unreasonably or negligently
simply because he or she acts for a party who pursues a claim or a defence which is plainly
doomed to fail: Ridehalgh (at 233); Medcalf v Mardell [2003] 1 AC 120 at 143 [56], per
Lord Hobhouse of Woodborough; White Industries (Qld) Pty Ltd v Flower & Hart (a firm) (1998)
156 ALR 169; 29 ACSR 21 (affirmed on appeal; Flower & Hart (a firm) v White Industries (Qld)
Pty Ltd (1999) 87 FCR 134); Levick v Commissioner of Taxation; cf Steindl Nominees Pty Ltd v
Laghaifar [2003] 2 Qd R 683;
(c)
The legal practitioner is not “the judge of the credibility of the witnesses or of the validity of
the arguments”: Tombling v Universal Bulb Co Ltd [1951] 2 TLR 289 at 297; [1951] WN 247 at
238; the legal practitioner is not “the ultimate judge, and if he reasonably decides to believe
his client, criticism cannot be directed to him”: Myers v Elman (at 304) per Lord Atkin; Arundel
Chiropractic Centre Pty Ltd v Deputy Commissioner of Taxation (2001) 179 ALR 406 at 413 [34];
47 ATR 1 at 8 [34], per Callinan J;
(d)
A judge considering making a wasted costs order arising out of an advocate’s conduct of
court proceedings must make full allowance for the exigencies of acting in that environment;
only when, with all allowances made, a legal practitioner’s conduct of court proceedings
is quite plainly unjustifiable can it be appropriate to make a wasted costs order: Ridehalgh
(at 236, 237);
(e)
A legal practitioner against whom a claim for a costs order is made must have full and sufficient
notice of the complaint and full and sufficient opportunity of answering it: Myers v Elman
(at 318); Orchard v South Eastern Electricity Board (at 572); Ridehalgh (at 229);
(f)
Where a legal practitioner’s ability to rebut the complaint is hampered by the duty of
confidentiality to the client he or she should be given the benefit of the doubt: Orchard v
South Eastern Electricity Board (at 572); Ridehalgh (at 229); in such circumstances “[t]‌he court
should not make an order against a practitioner precluded by legal professional privilege from
advancing his full answer to the complaint made against him without satisfying itself that it is
in all the circumstances fair to do so”: Medcalf (at 134 [23]) per Lord Bingham of Cornhill;
(g)
The procedure to be followed in determining applications for wasted costs must be fair and
“as simple and summary as fairness [(2005) 63 NSWLR 300 at 322] permits … [h]‌earings
should be measured in hours, and not in days or weeks … Judges … must be astute to control
what threatens to become a new and costly form of satellite litigation”: Ridehalgh (at 238-​
239); Harley v McDonald [2001] 2 AC 678 at 703 [50]; Medcalf (at 136 [24]).
The Legal Profession Act 2004
[20] The relevant provisions of the Legal Profession Act 2004 are ss 345 and 348, contained in Pt 3.2,
Division 10: [these provisions were thereafter provided].
“Reasonable prospects of success”
[21] Under s 348(1), an order may be made against a legal practitioner if it appears to the court
that the practitioner has provided legal services to a party to proceedings upon a claim for damages
“without reasonable prospects of success”. The threshold question, whether the proceedings were
“taken on a claim for damages” was not in issue as between the parties to this case.
[22] The onus remains upon the costs applicant throughout to demonstrate that the legal
practitioner had provided legal services without reasonable prospects of success: per McColl JA in
Lemoto at [137].
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Treadwell v Hickey cont.
[23] The construction of the phrase “without reasonable prospects of success” has been considered
in a number of cases. In Degiorgio v Dunn (No 2) [2005] NSWSC 3; (2005) 62 NSWLR 284, I accepted
at [26] that the predecessor statutory provision imposed upon legal practitioners a standard that is
more demanding than that applicable in cases where, by reference to general law principles, a costs
order is sought against a party’s lawyer. I expressed the view that “without reasonable prospects of
success” means “so lacking in merit or substance as to be not fairly arguable”.
[24] At [17] of the judgment, I said that one of the elements of the statutory standard imposed
upon practitioners is that “the reasonable belief” as to the prospects of success “must have its
objective foundation in material available to the practitioner at the relevant time”. This construction
was subsequently approved by McColl JA in Lemoto at [131]–​[132], the leading judgment in the area.
[25] The authorities show that a costs order under s 348 of the Legal Profession Act is not to be
lightly imposed upon a practitioner who has represented an unsuccessful party to a proceeding.
Indeed there is a high threshold, which must be satisfied before the court will consider exercising its
discretion to make such an order.
[26] The language of the statutory formulation is permissive rather than mandatory. If it is shown
that a law practice has provided legal services to a party without reasonable prospects of success a
discretion as to the exercise of the power remains.
The Civil Procedure Act 2005
[27] The relevant section, relied upon by Mr Hickey, is as follows: [s 99 Liability of legal practitioner for
unnecessary costs was thereafter provided]
[28] In Whyked Pty Ltd v Yahoo!7 Pty Ltd [2008] NSWSC 477 at [12], McDougall J, while noting
that the general law provided valuable guidance as to the exercise of the discretion to award costs
against a legal practitioner, held that the discretion must be exercised by reference to the statutory
formulation of the power. His Honour remarked:
Further, and more generally, it is necessary to bear in mind that the power to order costs
against a legal practitioner is that now found in s 99 of the Civil Procedure Act, and to be
exercised in accordance with the terms of that section. There is a danger in substituting
analyses of, or glosses upon, the section for the language employed in it.
[29] The central concepts in s 99(1), namely “neglect”, “incompetence”, “misconduct”, “improperly”
or “without reasonable cause” are not defined in the section or otherwise in the Civil Procedure Act.
[30] The court’s power to make a costs order against a legal practitioner pursuant to s 99 was
considered by Sully J in Ideal Waterproofing Pty Ltd v Buildcorp Australia Pty Ltd [2006] NSWSC 155.
His Honour concluded at [17] that s 99 should be applied consistently with the principles stated in
Ridehalgh v Horsefield [1994] Ch 205. This approach was subsequently supported by Windeyer J in
Karwal v Skrzypczak [2007] NSWSC 931 at [9]‌; McDougall J in Whyked Pty Ltd v Yahoo!7 Pty Ltd [2008]
NSWSC 477 at [17]–​[19] and Bryson AJ in European Hire Cars Pty Ltd v Beilby Poulden Costello [2009]
NSWSC 526 at [59].
[31] Ridehalgh (above) concerned aspects of the proper construction and application of s 51(6) and
(7) of the English Supreme Court Act 1981 (UK), provisions which generally correspond with the terms
of s 99 of the Civil Procedure Act. The judgment of Bingham JR, Rose LJ and Waite LJ in Ridehalgh is
particularly useful because of the consideration given to the meaning of “improper”, “unreasonable”
and “negligent” in respect to the jurisdiction to award costs against legal practitioners. Their Lordships
said at 223-​233:
“Improper” means what it has been understood to mean in this context for at least half a
century. The adjective covers, but is not confined to, conduct which would ordinarily be
held to justify disbarment, striking off, suspension from practice or other serious professional
penalty. It covers any significant breach of a substantial duty imposed by a relevant code of
[3.270]
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Civil Procedure in New South Wales
Treadwell v Hickey cont.
professional conduct. But it is not in our judgment limited to that. Conduct which would be
regarded as improper according to the consensus of professional (including judicial) opinion
can be fairly stigmatised as such whether or not it violates the letter of a professional code.
“Unreasonable” also means what it has been understood to mean in this context for at
least half a century. The expression aptly describes conduct which is vexatious, designed
to harass the other side rather than advance the resolution of the case, and it makes no
difference that the conduct is the product of excessive zeal and not improper motive. But
conduct cannot be described as unreasonable simply because it leads in the event to an
unsuccessful result or because other more cautious legal representatives would have acted
differently. The acid test is whether the conduct permits of a reasonable explanation. If
so, the course adopted may be regarded as optimistic and as reflecting on a practitioner’s
judgment, but it is not unreasonable.
The term “negligent” was the most controversial of the three. It was argued that the Act of
1990, in this context as in others, used “negligent” as a term of art involving the well known
ingredients of duty, breach, causation and damage. Therefore, it was said, conduct cannot
be regarded as negligent unless it involves an actionable breach of the legal representative’s
duty to his own client, to whom alone a duty is owed. We reject this approach. …
But for whatever importance it may have, we are clear that “negligent” should be
understood in an untechnical way to denote failure to act with the competence reasonably
to be expected of ordinary members of the profession.
In adopting an untechnical approach to the meaning of negligence in this context, we
would however wish firmly to discountenance any suggestion that an applicant for a wasted
costs order under this head need prove anything less than he would have to prove in an
action for negligence: “advice, acts or omissions in the course of their professional work
which no member of the profession who was reasonably well-​informed and competent
would have given or done or omitted to do”; an error “such as no reasonably well-​informed
and competent member of that profession could have made”: see Saif Ali v Sydney Mitchell &
Co [1980] AC 198, 218, 220, per Lord Diplock.
We were invited to give the three adjectives (improper, unreasonable and negligent)
specific, self-​contained meanings, so as to avoid overlap between the three. We do not read
these very familiar expressions in that way. Conduct which is unreasonable may also be
improper, and conduct which is negligent will very frequently be (if it is not by definition)
unreasonable. We do not think any sharp differentiation between these expressions is useful
or necessary or intended.
[32] The Court of Appeal said, in relation to the pursuit of a hopeless case:
A legal representative is not to be held to have acted improperly, unreasonably or negligently
simply because he acts for a party who pursues a claim or a defence which is plainly doomed
to fail … It is not entirely easy to distinguish by definition between the hopeless case and the
case which amounts to an abuse of the process, but in practice it is not hard to say which is
which and if there is doubt the legal representative is entitled to the benefit of it.
[33] Two additional principles were referred to by Sully J in Ideal Waterproofing. The first body of
principle which his honour referred to was said to be taken from Dal Pont: Lawyers’ Professional
Responsibility in Australia and New Zealand (2nd ed.) at 375:
Importantly, the jurisdiction to order costs against a lawyer personally is one to be exercised
sparingly, “with care and discretion and only in clear cases”, especially where the order
sought is one for indemnity costs. This is because, inter alia, it will often be difficult for a
court to know all the details and circumstances of the lawyer’s instructions. There is no cause
for the jurisdiction to be exercised merely because the litigation is decided adversely to
the litigant, for otherwise “those seeking to advance legitimate claims, or pursue legitimate
defences might well be deprived of legal representation and access to justice, in consequence,
144
[3.270]
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Treadwell v Hickey cont.
would be impeded”. Nor should the jurisdiction be attracted merely because of the lawyer’s
bona fide mistake or error of judgment, or where the client has misled the lawyer as to the
facts which would otherwise not have justified the action … To attract this jurisdiction, the
lawyer’s conduct must have involved a serious dereliction of duty or gross negligence.
[34] The proposition that the jurisdiction is to be exercised with caution and sparingly cannot be
contentious. Indeed it is the first principle referred to by McColl JA in [92] of Lemoto. The principle
was held to be applicable to the s 99 jurisdiction in Kelly v Jowett [2009] NSWCA 278 at [60]. Also, in
Whyked Pty Ltd McDougall J said:
[T]‌he exercise of the power given by s 99 of the Civil Procedure Act should be undertaken in
such a way as to deter legal practitioners from advancing difficult cases, or from accepting
instructions from impecunious clients. As a matter of general policy, someone with a case
that is not manifestly hopeless should not be denied the opportunity to litigate it.
[35] The second body of principle referred to by Sully J was taken from a decision of the Court of
Appeal of New Zealand: Harvey v McDonald [1999] 3 NZLR 545 at [59], [60] and [61]:
[59] An officer of the Court, whose role is to assist in the administration of justice, cannot
properly perform that role if falling below minimum levels of competence and care. There
is therefore a duty resting on such officers to achieve and maintain appropriate levels of
competence and care. If in serious dereliction of such duty, the officer is properly amenable
to the costs jurisdiction of the Court. This duty is reinforced by the fact that Parliament has
decreed that practitioners, both barristers and solicitors, must perform at a certain level
of competence and care, otherwise sanctions are available in terms of ss 106 and 112 of
the Law Practitioners Act 1982. That level is prescribed by giving the disciplinary tribunals
power to make orders if of opinion that the practitioner has been guilty of negligence or
incompetence in a professional capacity, and that the negligence or incompetence has been
of such a degree or so frequent as to reflect on the practitioner’s fitness to practise as a
barrister or solicitor or as to tend to bring the profession into disrepute.
[60] It is neither necessary nor desirable to attempt to define the level of incompetence
or negligence at which the costs jurisdiction can be invoked beyond saying that such
incompetence or negligence must amount to a serious dereliction of duty to the Court.
There is no necessary correspondence between the level at which disciplinary sanctions are
possible under the Law Practitioners Act 1982 and the level required to constitute a serious
dereliction of duty to the Court. It can be said, however, that the levels will often coincide,
and incompetence or negligence falling short of a disciplinary level under the Act, will not
ordinarily amount to a serious dereliction of duty to the Court.
[61] The English “wasted costs” legislation gives the Court jurisdiction if the legal
representative has acted “improperly, unreasonably, or negligently”. The United Kingdom
Parliament has determined that standard to be appropriate, but in terms of the inherent
jurisdiction of the High Court in New Zealand we do not consider the standard should
ordinarily be set lower than that adopted by our Parliament for the purposes of the Law
Practitioners Act 1982. For this Court to adopt the United Kingdom approach would come
close to legislating …
[36] The applicability of any “test of serious dereliction” was questioned both by Windeyer J in Karwal
and McDougall J in Whyked Pty Ltd. As stated at paragraph [31] above, the statutory formulation must
be adhered to. It is for that reason that I agree that any “test of serious dereliction” is irrelevant when
considering exercising the statutory jurisdiction.
…
Assessment of the claim
[114] This was not a case where proceedings were commenced in circumstances where they were
doomed to fail. Mr Fitzpatrick relied to a large extent on his client’s evidence in relation to an oral
[3.270]
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Civil Procedure in New South Wales
Treadwell v Hickey cont.
agreement being accepted by the court. The respective versions of events were in conflict. It was
inevitable that one version would have to be preferred by the court on the balance of probabilities.
A party cannot be said to have commenced proceedings without reasonable cause simply because the
party’s argument proved to be unsuccessful.
[115] True it is that there were pieces of evidence available to Mr Fitzpatrick which were
inconsistent with Mr Treadwell’s version of the retainer. However there were also pieces of evidence
which adversely impacted upon the version of events put forward by Mr Hickey. The argument put
forward by Mr Treadwell was not unworthy of consideration, it was not an application that should
not have been brought.
[116] The ultimate decision that Mr Treadwell’s case should fail was based upon the balance of
probabilities having regard to submissions made on behalf of the parties and the totality of the evidence
before the court, which in turn was the result of forensic decisions made by legal representatives,
rulings as to the admissibility of evidence, matters elicited in cross-​examination and impressions
gained of witnesses who were cross-​examined.
[117] It is also relevant that the statement of claim in the discontinued proceedings had been
prepared by other counsel and carried a certificate of reasonable prospects given by another solicitor.
It pleaded a case materially similar to that in the statement of claim in these proceedings –​indeed the
only difference related to the subsequent assignment of the causes of action.
[118] It was said by counsel for Mr Hickey that Mr Fitzpatrick had merely assumed that there was
material to support the allegations of material fact. However Mr Fitzpatrick says, and I accept, that his
instructions from Mr Treadwell and his inspection of the relevant documents convinced him on the
basis of provable facts and a reasonably arguable view [of] the law, that the claim against Mr Hickey
had reasonable prospects of success at all material times. I also find that such a belief was within
reason and based upon objective evidence.
[119] It is likely that the catalyst for this application for a costs order pursuant to s 348 was the
abandonment of a large proportion of Mr Treadwell’s case on the morning of the fourth day of the
proceedings. It is relevant, however, that no summary dismissal or strike out applications had been
made beforehand.
[120] The evidence makes it clear that Mr Fitzpatrick was surprised and disappointed by the
events of that morning. Mr Fitzpatrick, on his own account, relied to a large extent on counsel in
the way the matter was run at trial, with particular reference to the conduct of cross-​examination
and final submissions. That was an entirely appropriate attitude for a solicitor to take. The
performance of Mr Treadwell’s counsel, in the eyes of Mr Fitzpatrick, was poor and significantly
weakened Mr Treadwell’s case. Mr Fitzpatrick took steps to address some of the problems and
counsel sought an adjournment when it became clear that he was at cross-​purposes with his
instructing solicitor.
[121] I am satisfied that, at the time the proceedings were commenced and at all material times
thereafter, Mr Fitzpatrick was in a position where he held, on the basis of his own appraisal of matters,
a genuine subjective opinion, based upon objective facts, that it was incorrect and inappropriate to
regard Mr Treadwell’s case as so devoid of merit or substance as to be not fairly arguable. The fact
that, as the hearing evolved, elements of the original pleaded case were abandoned does not entail
that there was never reasonable prospects of success in regard to these claims. There were reasonable
grounds on the objective evidence for the belief held by the solicitor.
The alternative claim against the solicitor
[122] There is nothing in the present case to suggest that Mr Fitzpatrick commenced or continued
these proceedings with a deliberate ulterior purpose or with disregard of any proper consideration of
his professional duties in relation to prospects of success. The evidence given by Mr Fitzpatrick is that
he was at all times conscious of his professional responsibilities both to his client and to the court and
gave appropriate attention to these responsibilities.
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Treadwell v Hickey cont.
[123] In response to the motion seeking a costs order, Mr Fitzpatrick swore a detailed affidavit
which set out his beliefs and thought processes throughout the proceedings and the items of evidence
which he says supported such beliefs. Counsel for Mr Hickey, in closing submissions, described the
process as very “unreal”, in essence artificial, and questioned, in the abstract, whether the material
was actually represent [sic] in Mr Fitzpatrick’s mind at the relevant time and whether the evidence put
forward was a fair indication as to the true state of affairs.
[124] The jurisdiction under s 99 is enlivened where costs have been incurred as a result of serious
neglect, serious incompetence or serious misconduct or costs have been incurred improperly, or
without reasonable cause. As the authorities make clear, this is a high threshold to satisfy. It is not
enough simply to question the actions taken and beliefs held by an instructing solicitor, the evidentiary
burden must be satisfied. The defendant has failed to satisfy the burden in these proceedings.
[125] The findings and conclusions already outlined in relation to the claim under s 348 of the
Legal Procedure Act are sufficient to dispose of Mr Hickey’s claim against Mr Treadwell’s solicitor. This
is because, on the view I take, supported by authority, the standard of conduct required by the
forementioned provisions is more stringent, from the lawyer’s perspective, than that involved in the
procedure contained in the Civil Procedure Act.

SPECIFIC COSTS ORDERS
No order as to costs
[3.280] Where the court indicates that it makes no order as to costs, this means that no party
is ordered to pay the costs of the other party and each party is to pay its own costs. Such an
indication might be made where proceedings are determined without a hearing on the merits
of the action and where it cannot be said that one party has simply capitulated or one party
has acted unreasonably in initiating or defending the proceedings.11
Costs of the day
[3.290] This order refers to costs of a particular day. Those costs can include the costs for
work “reasonably connected” with the issues dealt with on that day, for example, preparation
and taking out the order which resulted from the hearing.12
A similar but different order is “costs thrown away” which are costs that are wasted because
of one party’s mistake including, but not limited to, not complying with a court direction or
rule of court.
Costs in any event
[3.300] This order usually concerns the costs of an interlocutory application. This kind
of costs order indicates that the party who is ordered to pay the costs is responsible for
11
12
See generally Hamilton J and Lindsay G, NSW Civil Practice & Procedure (Thomson Reuters, subscription
service), UCPR Part 42, Commentary, r 42.1.50.
See also Hamilton JP, Lindsay G, Morahan M and Webster C (eds), NSW Civil Procedure Handbook (Lawbook
Co, 2018), UCPR Part 42, Commentary, r Pt 42.1.60.
[3.300]
147
Civil Procedure in New South Wales
those costs irrespective of the outcome of the proceedings where, without another specific
order, costs would follow the event. Therefore, a party who is ordered to pay the costs of a
particular day or days, or pay the costs in relation to a particular application or issue “in
any event”, would be required to pay those costs even if that party were successful in the
proceedings.
Costs in the cause
[3.310] This order also usually concerns the costs of an interlocutory application. Who
should pay the costs of the application is not determined at the time of the application. The
order that the costs of the interlocutory application become costs in the cause means that the
party that will ultimately be liable for the costs of the proceedings (usually the loser) will have
to pay the costs of that interlocutory application as well.13
JOINING PARTIES AND COSTS
[3.320] Costs orders can vary where there are multiple parties and mixed results eventuate.
For example, the plaintiff may succeed against one defendant but be unsuccessful against
another defendant. Costs are at the discretion of the court, but the court must decide whether
to order that the plaintiff pay the costs of the successful defendant or order the unsuccessful
defendant to pay some or all of the costs of the successful defendant.
Special costs orders are available to meet costs issues arising where there is joinder of
parties. These orders are known as “Bullock orders”14 and “Sanderson orders”.15
Where a Bullock order is made, the plaintiff pays the costs of the successful defendant
directly to that defendant, but then adds those costs as a disbursement to the plaintiff’s costs
which are to be paid by the unsuccessful defendant.
A variation of the Bullock order is the Sanderson order, by which an unsuccessful defendant
is ordered to pay the costs of both the plaintiff and the successful defendant.
Where the unsuccessful defendant is impecunious, the choice of a Bullock or Sanderson
order is important. If the unsuccessful defendant lacks sufficient resources to pay the costs,
it is to the advantage of the successful defendant to receive a Bullock order. This is because
the plaintiff must pay the successful defendant’s costs directly and then attempt to recover
those costs as well as his or her own costs, from the impecunious unsuccessful defendant. The
plaintiff on the other hand would prefer a Sanderson order.
Whether to make a Sanderson or Bullock order, or any costs order at all, is in the discretion
of the court. Bullock and Sanderson orders are convenient when the court takes the view
that the unsuccessful defendant should pay the costs of the proceeding. The court must be
satisfied that it was reasonable for the plaintiff to join the successful defendant and there
must generally be some conduct on the part of the unsuccessful defendant that contributed to
the plaintiff’s decision to join the successful defendant. This could be, for example, where the
unsuccessful defendant blamed the successful defendant.
13
14
15
See also Cairns BC, Australian Civil Procedure (11th ed, Thomson Reuters, 2016), Ch 17.
This order takes its name from Bullock v London General Omnibus Co [1907] 1 KB 264.
This order takes its name from Sanderson v Blyth Theatre Co [1903] 2 KB 533.
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[3.310]
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Chapter 3
Nationwide News v Naidu; ISS Security v Naidu (No 2)
[3.330] Nationwide News Pty Ltd v Naidu; ISS Security Pty Ltd v Naidu (No 2) [2008] NSWCA 71
SPIGELMAN CJ, BEAZLEY AND BASTEN JJA
[2]‌The original proceedings in the Common Law Division were brought by Mr Naidu against his
former employer, ISS Security Pty Ltd (“ISS”) and the company with which he was placed as a security
officer, namely Nationwide News Pty Ltd (“Nationwide”). At trial Mr Naidu obtained judgment
against ISS and Nationwide, though in differing amounts, reflecting the operation of s 151Z of the
Workers Compensation Act 1987 (NSW). On appeal, ISS was successful in setting aside the judgment
against it, but Nationwide News was unsuccessful. …
Sanderson costs order
[14] The final issue raised by the further submissions concerned an application by Mr Naidu for an
order that Nationwide pay the costs of ISS, pursuant to Sanderson v Blyth Theatre Co [1903] 2 KB 533.
Nationwide resists such an order.
[15] As a result of its success on the appeal, ISS is entitled to receive its costs of the trial. The
question is who should pay them. Pursuant to a Sanderson order, the unsuccessful defendant, namely
Nationwide, may be ordered to pay the costs of the successful defendant, namely ISS. It is well-​
established that such an order may be made where two preconditions are satisfied, namely that
it was reasonable for the plaintiff to proceed against the successful defendant and, secondly, that
the conduct of the unsuccessful defendant made it fair to impose liability on it for the costs of the
successful defendant: see Gould v Vaggelas (1985) 157 CLR 215 at 230 (Gibbs CJ).
[16] Those preconditions operate where the costs are required to be paid directly by one defendant to
the other (in the case of a Sanderson order) or indirectly, where the plaintiff is ordered to pay the costs of
the successful defendant, but is entitled to recover his or her costs, including those paid to the successful
defendant, from the unsuccessful defendant (a Bullock order). In the present case, Mr Naidu did not seek
a Bullock order and Nationwide did not oppose the proposed costs order on the basis that there was any
distinction in the preconditions to such an order. Nationwide did, however, contend that there was an
additional precondition, namely that the claim against ISS should have been either inter-​dependent with,
or in a real sense alternative to, the claim against Nationwide. That was said to follow from a comment
made in Norwest Refrigeration Services Pty Ltd v Bain Dawes (WA) Pty Ltd (1984) 157 CLR 149 at 163.
[17] It is by no means clear that the joint judgment in Norwest Refrigeration intended to lay down
such an additional requirement. If that had been intended, it is surprising that the decision was
not referred to in Gould, a case involving three of the four authors of the joint judgment in Norwest
Refrigeration including Gibbs CJ whose statement of principle in Gould is now treated as authoritative.
Further, it is not entirely clear what their Honours meant by saying that the unsuccessful action by
Norwest against its insurer on the insurance policy was not in any real sense alternative to the claim
against the Co-​operative, on which it succeeded. Norwest had taken out insurance in relation to a
fishing vessel which was subsequently destroyed by fire. Under the insurance policy, the vessel was
required to have a current certificate of survey, which it did not. The insurer was found not to be liable
on that basis. The claim against the Co-​operative was based upon its failure to take reasonable care
to arrange insurance of the type requested or to warn Norwest of any exclusions or limitations in the
policy. On its face, the claim against the Co-​operative was in a real sense an alternative to the claim
against the insurer: if the policy covered the claim, the insurer was liable and the Co-​operative was
not; the exclusion provided the basis for the insurer’s success and the Co-​operative’s failure.
[18] The joint judgment in Norwest Refrigeration was not seeking to settle some general principle,
but was dealing with an appeal from a discretionary decision with respect to costs in the court below.
Properly understood, the inter-​dependence of claims against two defendants or the need to join
both in circumstances where one only may be liable but the plaintiff is unable to determine which,
are examples of circumstances which may demonstrate the reasonableness of the plaintiff in joining
[3.330]
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Civil Procedure in New South Wales
Nationwide News v Naidu; ISS Security v Naidu (No 2) cont.
the successful defendant. These examples may be borne in mind, but the test should be understood
as that set out by Gibbs CJ in Gould. (An example of inter-​dependent and alternative claims is to be
found in State of Victoria v Horvath (No 2) [2003] VSCA 24 at [9]‌where the plaintiffs had sued both
police officers and the State in circumstances where the State would be liable, but not the police
officers, if the officers were acting within the scope of their authority but the police officers alone
would [be] liable if they were not.)
[19] It is difficult to deny that the first precondition in Gould was established in the present case.
Both the trial judge and one member of this Court thought that the claim against ISS was not merely
reasonable, but should succeed. Further, it will frequently be reasonable to join an employer, even if the
clearer liability is that of a third party defendant, because of the requirement, in assessing damages, to
take account of any entitlement of the plaintiff to recover from his or her employer as a joint tortfeasor
or otherwise, pursuant to s 151Z(2)(c) of the Workers Compensation Act. Although the joinder of the
employer is not necessary to allow the necessary calculation to take place, there are difficulties for a
court determining the entitlement as against the employer in circumstances where the employer is
not party to the proceedings and the plaintiff is seeking to deny any entitlement to recover from the
employer. That is not to say that it will always be reasonable to join an employer in such circumstances;
rather, in the present circumstances it was a reasonable step for the plaintiff to take.
[20] The real question is whether there was anything in the conduct of Nationwide which would
make it just to impose upon it liability for the plaintiff’s costs as against the successful defendant. As
explained by Gibbs CJ in Gould (at p 229):
Obviously a judge should make a Bullock order only if he considers it just that the costs of the
successful defendant should be borne by the unsuccessful defendant, and, if nothing that
the unsuccessful defendant has said or done has led the plaintiff to sue the other defendant,
who ultimately was held not to be liable, it is difficult to see any reason why the unsuccessful
defendant should be required to pay for the plaintiff’s error or overcaution.
[21] In some circumstances, one or other of two defendants may be liable, where the identity of
the correct defendant depends on matters known to the defendants but not the plaintiff. Coombes v
Roads and Traffic Authority (No 2) [2007] NSWCA 70 provides an example. In that case an order was
appropriate because the plaintiff had taken express steps to have the Council indicate which of it or
the RTA was responsible for particular aspects of road construction works about which complaint was
made and the unsuccessful Council failed to concede that it bore responsibility and not the RTA.
[22] This case is, however, different. The potential liability of ISS did not depend, for example, upon
the contractual relationship between nationwide and ISS. Nationwide’s defence was that its liability
depended upon whether its senior officers knew or ought reasonably to have known of Mr Chaloner’s
treatment of Mr Naidu. That defence failed. Mr Naidu bore the burden of proof in respect of his claim
against ISS. To a significant extent, his success depended upon acceptance of his own evidence as to
matters of complaint to Mr Blinkworth or others in authority with ISS. His joinder of ISS involved an
assessment of his prospects in establishing such knowledge, actual or constructive. In that he failed, but
neither his decision to join ISS nor his failure to prove its liability resulted from any particular conduct of
Nationwide. Indeed, the strongest submission made in that respect was that, had Nationwide admitted
liability, as properly it should have, he would not have been forced to engage in lengthy litigation
against either Nationwide or ISS. That, however, is not the test. Nationwide was entitled to defend itself
even while not defending Mr Chaloner’s conduct. Its defence did not in any relevant sense suggest that
his conduct was the responsibility of ISS. Nationwide was ultimately unsuccessful and must bear the
plaintiff’s costs as a result. However, its conduct, whether by omission or commission, did not provide a
basis upon which it could fairly be said that it should bear the costs of the plaintiff’s action against ISS.
Accordingly the appropriate order in relation to the costs of the trial, as between Mr Naidu and ISS, is
that he should pay the trial costs incurred by ISS, assessed on the ordinary basis.

150
[3.330]
Costs of Litigation
Chapter 3
COSTS AND SELF-​REPRESENTED LITIGANTS
[3.350] If a costs order is awarded to a self-​represented litigant, the costs award will generally
only be an entitlement to recover out-​of-​pocket expenses. This is because costs are meant to
compensate for professional legal fees, which a self-​represented litigant does not incur.
Cachia v Hanes
[3.360] Cachia v Hanes (1994) 179 CLR 403
MASON CJ, BRENNAN, DEANE, DAWSON AND MCHUGH JJ (TOOHEY AND GAUDRON JJ
DISSENTING)
[20] Whilst the restricted basis upon which party and party costs are awarded may be debated as
a matter of policy, it is to be borne in mind that party and party costs have never been regarded as a
total indemnity to a successful litigant for costs incurred, let alone total recompense for work done
and time lost. Putting to one side the question posed by the relatively rare exception of a solicitor
acting in person, there is no inequality involved: all litigants are treated in the same manner. And if
only litigants in person were recompensed for lost time and trouble, there would be real inequality
between litigants in person and litigants who were represented, many of whom would have suffered
considerable loss of time and trouble in addition to incurring professional costs. The partial indemnity
which the law allows represents a compromise between the absence of any provision for costs (which
prevails as a matter of policy in some jurisdictions) and full recompense. In these days of burgeoning
costs, the risk of which is a real disincentive to litigation, the proper compromise is a matter of both
difficulty and concern.
…
[22] Whilst the right of a litigant to appear in person is fundamental, it would be disregarding the
obvious to fail to recognize that the presence of litigants in person in increasing numbers is creating
a problem for the courts ((16) The problem is well documented in the United States: see Mueller,
“Abusive pro se Plaintiffs in the Federal Courts: Proposals for Judicial Control” (1984) 18 Journal of Law
Reform 93 at 101; Rubin, “The Civil Pro Se Litigant v The Legal System” (1989) 20 Loyola University
Law Journal 999; Gillies, “Who’s Afraid of the Sanction Wolf: Imposing Sanctions on pro se Litigants”
(1989) 11 Cardozo Law Review 173). It would be mere pretence to regard the work done by most
litigants in person in the preparation and conduct of their cases as the equivalent of work done by
qualified legal representatives. All too frequently, the burden of ensuring that the necessary work
of a litigant in person is done falls on the court administration or the court itself. Even so, litigation
involving a litigant in person is usually less efficiently conducted and tends to be prolonged ((17)
See Powles, “Litigant in Person –​Discussion Paper” in Australian Institute of Judicial Administration,
The Litigant in Person (1993) 7 at 10–​11). The costs of legal representation for the opposing litigant
are increased and the drain upon court resources is considerable. On the other hand, there is no
doubt that the inability of a litigant in person to obtain recompense for time spent in the conduct of
successful litigation must on occasions be a significant deterrent to the exercise of his right to come
to court in person ((18) cf British Columbia, Law Reform Commission, Report on Civil Procedure: Pt 1 –​
Costs of Successful Unassisted Lay Litigants (1975); South Australia, Law Reform Committee, Report
Relating to the Award of Costs to a Litigant Appearing in Person (1974)). We mention these matters
not to express any view, but merely to indicate that there are considerations which must be weighed
before any reasoned conclusion can be reached. A court engaged in litigation between parties, even if
it were not constrained by the legislation and rules, is plainly an inappropriate body to carry out that
exercise or to act upon any conclusion by laying down the precise nature of any change required.

[3.370] If the self-​represented litigant is a legal practitioner, he or she is not entitled to receive
a costs order, as had been allowed under earlier precedent.
[3.370]
151
Civil Procedure in New South Wales
Bell Lawyers v Pentelow
[3.380] Bell Lawyers Pty Ltd v Pentelow [2019] HCA 29
KIEFEL CJ, BELL, KEANE AND GORDON JJ (GAGELER AND EDELMAN JJ AGREEING; NETTLE J
AGREEING IN PART)
[1]‌As a general rule, a self-​represented litigant may not obtain any recompense for the value of
his or her time spent in litigation[1]. Under an exception to the general rule, a self-​represented litigant
who happens to be a solicitor may recover his or her professional costs of acting in the litigation. This
exception is commonly referred to as “the Chorley exception”, having been authoritatively established
as a “rule of practice” by the Court of Appeal of England and Wales in London Scottish Benefit Society
v Chorley[2].
[2]‌One issue raised by this appeal is whether the Chorley exception operates to the benefit
of barristers who represent themselves. Another, more fundamental, issue is whether the Chorley
exception should be recognised as part of the common law of Australia.
[3]‌ The Chorley exception has rightly been described by this Court as “anomalous”[3]. Because it is
anomalous, it should not be extended by judicial decision[4] to the benefit of barristers. This view has
previously been taken by some courts in Australia[5]. Dealing with the matter more broadly, however,
the Chorley exception is not only anomalous, it is an affront to the fundamental value of equality of
all persons before the law. It cannot be justified by the considerations of policy said to support it.
Accordingly, it should not be recognised as part of the common law of Australia.
…
The power to order costs
[13] The power to make an order for costs is conferred on the courts of New South Wales by s 98(1)
of the Civil Procedure Act 2005 (NSW), which provides:
“Subject to rules of court and to this or any other Act:
(a)
costs are in the discretion of the court, and
(b)
the court has full power to determine by whom, to whom and to what extent costs are to be
paid, and
(c)
the court may order that costs are to be awarded on the ordinary basis or on an indemnity
basis.”
[14] Section 3(1) of the Civil Procedure Act defines “costs” as follows:
“costs, in relation to proceedings, means costs payable in or in relation to the proceedings, and
includes fees, disbursements, expenses and remuneration.”
[15] On one view, the reference to “costs payable” in this definition is an indication that an order
for costs may be made only in respect of costs payable by the party in whose favour the order is made
to another person for services rendered. On this view the Chorley exception is inconsistent with the
statutory definition of costs and, costs being a creature of statute, the Chorley exception has been
displaced by the Civil Procedure Act.
[16] This view, which commended itself to Meagher JA below[19], was advanced by the appellant
in argument in this Court. The respondent argued that the legislature did not intend to abrogate the
Chorley exception by ss 3 and 98(1) of the Civil Procedure Act in the absence of clear words to that
effect. It is preferable to address the proper effect of ss 3 and 98(1) of the Civil Procedure Act in the
context of a discussion of the broader question whether the Chorley exception should be recognised as
part of the common law of Australia. The examination of that question may conveniently proceed by
reference to the principal authorities referred to by the parties in the course of argument in this Court.
Chorley
[17] One may begin with a consideration of the reasons said to support the Chorley exception. In that
case, Brett MR stated the general rule, and the exception to it, in the following terms[20]:
152
[3.380]
Costs of Litigation
Chapter 3
Bell Lawyers v Pentelow cont.
“When an ordinary party to a suit appears for himself, he is not indemnified for loss of time;
but when he appears by solicitor, he is entitled to recover for the time expended by the
solicitor in the conduct of the suit. When an ordinary litigant appears in person, he is paid
only for costs out of pocket. He cannot himself take every step, and very often employs a
solicitor to assist him: the remuneration to the solicitor is money paid out of pocket. He has
to pay the fees of the court, that is money paid out of pocket; but for loss of time the law will
not indemnify him. When, however, we come to the case of a solicitor, the question must
be viewed from a different aspect. There are things which a solicitor can do for himself, but
also he can employ another solicitor to do them for him; and it would be unadvisable to lay
down that he shall not be entitled to ordinary costs if he appears in person, because in that
case he would always employ another solicitor.”
[18] It may be said immediately that the view that it is somehow a benefit to the other party that
a solicitor acts for himself or herself, because the expense to be borne by the losing party can be
expected to be less than if an independent solicitor were engaged, is not self-​evidently true. A self-​
representing solicitor, lacking impartial and independent advice that the court expects its officers to
provide to the litigants they represent, may also lack objectivity due to self-​interest. That may, in turn,
result in higher legal costs to be passed on to the other party in the event that the self-​representing
solicitor obtains an order for his or her costs.
[19] Importantly, the view that solicitors should be encouraged to act for themselves is contrary to
the modern orthodoxy that it is undesirable, as a matter of professional ethics, for a solicitor to act for
himself or herself in litigation. In McIlraith v Ilkin (Costs), Brereton J said[21]:
“Where a solicitor represents a litigant, the court is entitled to expect the litigant to be
impartially and independently advised by an officer of the court. Indeed, where the court
concludes that a solicitor is not in a position to give impartial and independent advice to
a party, because of the solicitor’s own interest in the outcome, the court has restrained the
solicitor from continuing to act … Where a solicitor acts for himself or herself there cannot
be independent and impartial advice, and this is in principle a strong reason for holding that
a solicitor litigant should not be entitled to costs of acting for him or herself.”
[20] The view expressed by Brereton J is reflected in rr 17.1 and 27.1 of the Australian Solicitors’
Conduct Rules, which have been adopted in New South Wales[22], Victoria, Queensland, South
Australia and the Australian Capital Territory. Rules broadly equivalent to rr 17.1 and 27.1 of
the Australian Solicitors’ Conduct Rules also appear in the conduct rules of Western Australia and the
Northern Territory.
[21] In Chorley, Bowen LJ explained the rationale for the exception as follows[29]:
“Professional skill and labour are recognised and can be measured by the law; private
expenditure of labour and trouble by a layman cannot be measured. It depends on the zeal,
the assiduity, or the nervousness of the individual. Professional skill, when it is bestowed, is
accordingly allowed for in taxing a bill of costs; and it would be absurd to permit a solicitor
to charge for the same work when it is done by another solicitor, and not to permit him to
charge for it when it is done by his own clerk.”
[22] This reasoning is not persuasive. The notion that the “private expenditure of labour and trouble
by a layman cannot be measured” is not the basis for the general rule. The general rule that a self-​
represented litigant may not obtain any recompense for his or her time spent on litigation is not
based on a concern about the difficulty of valuing the appropriate amount of recompense, but, as
was explained by the majority in Cachia v Hanes, because “costs are awarded by way of … partial
indemnity … for professional legal costs actually incurred in the conduct of litigation”[30]. Accordingly,
to say that the value of legal services rendered by a solicitor to himself or herself can be measured is
not to justify an exception to the general rule.
[3.380]
153
Civil Procedure in New South Wales
Bell Lawyers v Pentelow cont.
[The High Court disavowed any reasoning in the judgments in Guss v Veenhuizen (No 2) (1976)
CLR 47 and Cachia v Hanes (1994) 179 CLR 403 that accepted the Chorley exception as applying in
Australia and rejected several arguments advanced by the respondent that the Chorley rule should
be maintained, including because the abolition of the Chorley exception should be one for the
legislature.]
A matter for the legislature
[54] The respondent also argued that this Court should refrain from holding that the Chorley exception
is not part of the common law because that is a task more appropriately dealt with by the relevant
legislature or rules committee of a superior court[66]. It was said that the legislature would be better
placed than a court to decide whether the court’s rules of practice should be altered or abrogated.
This argument may be disposed of briefly. The majority in Cachia saw great difficulty in resolving the
inconsistency between the general rule and the Chorley exception by judicial abolition of the general
rule. No such difficulty was said to confront the taking of the logical step of holding that the exception
is not part of the common law. The Chorley exception is the result of judicial decision, and it is for this
Court to determine whether it is to be recognised in Australia. …
Conclusion and orders
[57] There is no compelling reason for this Court to refrain from taking the “logical step” identified
in Cachia. The Chorley exception is not part of the common law of Australia.
[58] The appeal should be allowed. Orders 1 to 4 of the Court of Appeal of the Supreme Court
of New South Wales should be set aside. In their place it should be ordered that the summons for
judicial review be dismissed and the first respondent pay the appellant’s costs in the District Court
and the Court of Appeal. The first respondent should pay the appellant’s costs of the appeal to
this Court.
Cachia v Hanes (1994) 179 CLR 403 at 410-​411; [1994] HCA 14. See also Guss v Veenhuizen [No 2] [1976]
HCA 57; (1976) 136 CLR 47 at 51; [1976] HCA 57.
[1]‌
(1884) 13 QBD 872 at 877. The rule of practice was acknowledged prior to the decision in Chorley by
Faucett J in the Supreme Court of New South Wales in Pennington v Russell [No 2] [1883] NSWLawRp 47;
(1883) 4 LR (NSW) Eq 41.
[2]‌
[3]‌
Cachia v Hanes (1994) 179 CLR 403 at 411.
Midgley v Midgley [1893] 3 Ch 282 at 299, 303, 306-​307; Best v Samuel Fox & Co Ltd [1952] AC 716 at
728, 733; Cassell & Co Ltd v Broome [1972] UKHL 3; [1972] AC 1027 at 1086; CSR Ltd v Eddy [2005] HCA
64; (2005) 226 CLR 1 at 18 [35]; [2005] HCA 64.
[4]‌
See Hartford Holdings Pty Ltd v CP (Adelaide) Pty Ltd [2004] SASC 161 at [125]; Winn v Garland Hawthorn
Brahe (Ruling No 1) [2007] VSC 360 at [10]-​ [11]; Murphy v Legal Services Commissioner [No 2] [2013] QSC
253 at [16]; Bechara v Bates [2018] FCA 460 at [6]. But see to the contrary Ada Evans Chambers Pty Ltd v
Santisi [2014] NSWSC 538 at [29].
[5]‌
[19]
Pentelow v Bell Lawyers Pty Ltd [2018] NSWCA 150 at [126]-​ [141] .
[20]
London Scottish Benefit Society v Chorley (1884) 13 QBD 872 at 875.
[21]
[2007] NSWSC 1052 at [25].
[22]
Legal Profession Uniform Law Australian Solicitors’ Conduct Rules 2015 (NSW).
[29]
London Scottish Benefit Society v Chorley (1884) 13 QBD 872 at 877.
[30]
(1994) 179 CLR 403 at 410.
[66]
McGuire v Secretary for Justice [2018] NZSC 116 at [88].

154
[3.380]
Costs of Litigation
Chapter 3
COSTS AGAINST NON-​PARTIES
[3.390] Section 98 of the CPA is broad enough to provide power to make costs orders
against non-​parties.16 Under the general law, the principle is that a costs order should only be
made against a party to the proceedings. However, a reasonable and just costs award against
a non-​party could be justified in exceptional circumstances.17 For example, in the case of
nominal parties or next friends, where a person who is a non-​party is closely connected to the
proceedings,18 or when a person appears in the proceedings for a specific and limited purpose,
such as to maintain a claim of privilege19 or to obtain a costs order.20
Heath v Greenacre Business Park
[3.400] Heath v Greenacre Business Park Pty Ltd [2016] NSWCA 34
[Heath was a director of Deliver Australia Pty Ltd, the defendant and cross-​claimant in proceedings
in the Equity Division of the Supreme Court of NSW. Heath verified the pleadings and made affidavits
in that proceeding, including providing an affidavit that he had been authorized by resolution of the
directors of Deliver that he was to carry on proceedings on behalf of Deliver. The court made an order
for security for costs that was never satisfied by Deliver. Subsequently, Greenacre sought orders for
Heath to pay Greenacre’s costs associated with the defence and cross-​claim in the proceeding.]
GLEESON JA
[26] At [17],21 his Honour referred to authorities for the proposition that the power under
s 98 of the Civil Procedure Act to make costs orders against non-​parties, is to be exercised only in
exceptional circumstances, that is, outside the ordinary run of cases, and is a power to be exercised
sparingly: FPM Constructions Pty Ltd v City of the Council of the Blue Mountains [2005] NSWCA 340
(FPM Constructions) at [210], [214]; May v Christodoulou [2011] NSWCA 75; 80 NSWLR
462 at [107] –​[116]; and Kebaro Pty Ltd v Saunders [2003] FCAFC 5 at [103].
[27] At [18], his Honour accepted that whilst the categories of cases which may attract the exercise
of the power to make costs orders against non-​parties are not closed, they often satisfy some, if not a
majority, of the criteria identified by Basten JA in FPM Constructions at [201], namely:
(a)
the unsuccessful party to the proceedings was the moving party and not the defendant;
(b)
the source of funds for the litigation was the non-​party or its principal;
(c)
the conduct of the litigation was unreasonable or improper;
(d)
the non-​party, or its principal, had an interest (not necessarily financial) which was equal to or
greater than that of the party or, if financial, was a substantial interest, and
(e)
the unsuccessful party was insolvent or could otherwise be described as a person of straw.
[28] His Honour continued at [19]:
But it is clear in my view that costs orders against a non-​party, whether director or
solicitor, would be warranted where the unsuccessful party is a person or entity of
straw and where the conduct of the litigation by the non-​party in question is improper.
Maintaining a claim or a defence on a knowingly false basis is improper conduct that
warrants the exercise of the power. The same conduct justifies the making of a costs
order on the indemnity basis.
16
17
18
19
20
21
Note that UCPR r 42.3 was repealed on 7 May 2010.
See Murphy v Young & Co Brewery [1997] 1 WLR 1591.
Knight v FP Special Assets Ltd (1992) 174 CLR 178; 66 ALJR 560; Palmer v Walesby (1868) LR 3 Ch App 732.
ACP Magazines Pty Ltd v Motion [2000] NSWSC 1169.
Wentworth v Wentworth [2000] NSWCA 350.
Greenacre Business Park Pty Ltd v Deliver Australia Pty Ltd (in Liq) [2014] NSWSC 1646.
[3.400]
155
Civil Procedure in New South Wales
Heath v Greenacre Business Park cont.
[29] His Honour concluded at [20]:
I am satisfied that the defence and cross claim were propounded on a basis that Mr Heath
knew to be false. It may be observed that he has not taken up the opportunity to appear to
defend his conduct. Nor were any affidavits served in response to the affidavits served by the
plaintiffs that “convincingly challenged the accuracy of the facts deposed to by Mr Heath
and Mr Biggs”. In my view, an order should be made that Mr Heath personally be liable for
the plaintiffs’ costs, and the costs for which he should be liable should be assessed on the
indemnity basis. I also think that the plaintiffs should not be further delayed by having to
have their costs assessed. Pursuant to s 98(4)(c) of the Civil Procedure Act, the Court may
make an order to the effect that the party to whom costs are to be paid is to be entitled to
a specified gross sum instead of assessed costs. This is a proper case for the exercise of that
power. …
Relevant legislation
[32] Section 98(1) of the Civil Procedure Act, provides as follows:
98 Courts powers as to costs
(1)
Subject to rules of court and to this or any other Act:
(a)
costs are in the discretion of the court, and
(b)
the court has full power to determine by whom, to whom and to what extent costs are
to be paid, and
(c)
the court may order that costs are to be awarded on the ordinary basis or on an
indemnity basis.
[33] It is well-​established that the terms of s 98 are sufficient to confer on the court a general
power to make orders against non-​parties: Knight v FP Special Assets Ltd [1992] HCA 28; 174 CLR
178 (Knight).
[The Court of Appeal allowed the appeal, finding that the lower court’s discretion had miscarried
due to material errors of fact finding that the appellant knew about the falsity of Deliver’s allegations
in the defence and cross-​claim, but re-​exercised the costs discretion.]
Re-​exercise of the costs discretion
[79] Where the exercise of a discretionary power has miscarried, it may be appropriate to remit the
proceedings to the primary judge for re-​exercise of the power according to law. In the present case,
neither party requested that the proceedings be remitted. The appellant did not seek to rely upon
any evidence should this Court re-​exercise the costs discretion. Nor did the respondents contend
that his Honour declined or failed to make any findings of fact sought by the respondents. In these
circumstances, this Court should reconsider the respondents’ motion for a non-​party costs order
against the appellant under s 98(1) of the Civil Procedure Act.
[80] In May v Christodoulou at [111], Sackville AJA pointed out that the criteria identified by Basten
JA in FPM Constructions (at [210]) (set out at [26] above), are not intended to be and cannot be
exhaustive and that other factors may bear on the exercise of the discretionary power in a particular
case. What needs to be emphasised is that the exceptional jurisdiction to make a non-​party costs
order is only to be exercised where, in the circumstances of the case, the interests of justice require
that such an order be made: see Yu v Cao [2015] NSWCA 276 at [137] and [139]:
“Exceptional” in the context of the exercise of the non-​party costs jurisdiction means no
more than outside the ordinary run of cases where parties pursue or defend claims for their
own benefit and at their own expense.
[81] There is a further consideration. Care must be taken not to apply the criteria identified by Basten
JA in FPM Constructions mechanically. This is because as Basten JA observed (at [214]), it will often
156
[3.400]
Costs of Litigation
Chapter 3
Heath v Greenacre Business Park cont.
be the case that a non-​party, be it a company officer or solicitor, will be active in the conduct of
litigation and obtain some direct or indirect financial benefit from its success. His Honour continued
(at [214]):
Careful attention is required as to the conduct of the party said to be involved in the litigation
and the nature of the “interest” in its outcome or subject matter.
[82] In the present case, there is no issue as to the role played by the appellant in the proceedings.
The appellant caused the Lessee to defend the proceedings and propound a cross-​claim seeking
substantial damages against the respondents. When the Lessee’s solicitors ceased to act in mid-​
May 2014, the appellant took over the conduct of the appellant’s defence and cross-​claim which he
continued to assert in the face of the respondents’ reply evidence and the absence of evidence from
the Lessee to contradict it.
[83] The appellant continued to actively manage the proceedings for the Lessee at least up until 29
September 2014, when the directors of the Lessee appointed a voluntary administrator. The appellant
attended the directions hearings on 30 May 2014 and on 13 June 2014. On the later date, he sought
an order for a mediation, which took place on 8 July 2014 with the appellant representing the Lessee.
The mediation was unsuccessful. It was followed by the respondents’ application filed 13 August
2014 seeking security for costs and dismissal of the Lessee’s cross-​claim, which was listed for hearing
on 30 September 2014. The appellant indicated by email on 29 September 2014, that he would not
be appearing the next day: [2015] NSWSC 1353at [14]. Had the Lessee consented to judgment by
30 May 2014, the respondents would have avoided the further costs which they incurred up to and
including the final hearing on 17 November 2014.
[84] The appellant was a director and secretary of the Lessee and its largest unsecured creditor. It
is common ground that the appellant had an indirect interest as a shareholder in the Lessee. The ASIC
search reveals that Heathco Pty Limited held a 39 percent shareholding in the Lessee. The appellant
also had an interest in the outcome or subject matter of the proceedings in the sense that if the cross-​
claim were successful, he stood to gain because it may result in a return to him in his capacity as the
Lessee’s largest creditor.
[85] It can also be inferred that from at least 30 May 2014 the Lessee, if not impecunious, was
facing significant financial difficulties in meeting its own costs of the litigation, let alone those of
the respondents’ costs, should the Lessee be unsuccessful. This inference arises from the following
matters. First, the administrator’s report to creditors on 9 October 2014 noted that the Lessee had
lost a significant part of its business during 2013, and that the assets of the Lessee had been sold
to a related entity on 1 December 2013. Secondly, having told the Court on 30 May 2014 that
the Lessee was waiting on funds to arrive within the next two to three weeks to decide whether
or not to defend the case, the appellant did not subsequently suggest that any funding was ever
forthcoming for the Lessee. As Robb J noted in his reasons when dealing with the application for
security for costs on 1 October 2014, the appellant “has not provided any specific confirmation
to the court, or to the plaintiff, as to whether it has funds to contest the hearing”: [2014] NSWSC
1353 at [46]. Thirdly, as Robb J also noted (at [49]) the appellant “did not deny that the [Lessee]
was impecunious; but instead he asserted that the [respondents] were responsible for the [Lessee’s]
financial difficulties.” As already noted the Lessee failed to provide security for costs as ordered on
1 October 2014.
[86] The absence of evidence from the appellant before his Honour explaining his decision to
maintain the Lessee’s defence and cross-​claim after receipt of the respondents’ reply affidavits is
significant. This is because it is necessary to evaluate the evidence “according to the proof which is in
the power of one side to have produced, and in the power of the other to have contradicted”: Blatch
v Archer (1774) 1 Cowp 53 at 65; [1774] EngR 2; 98 ER 969 at 970 (Lord Mansfield).
[87] In my view, the appellant as a director of the Lessee had no reasonable prospect of defending
the proceedings or succeeding on the cross-​claim in the face of the respondents’ reply affidavits,
[3.400]
157
Civil Procedure in New South Wales
Heath v Greenacre Business Park cont.
which the Lessee had not sought to contradict. Further, the appellant acted irresponsibly as a director
of the Lessee in not accepting the inevitable by consenting to judgment no later than 30 May 2014.
Instead, he allowed the risk of a likely costs order against the Lessee to continue unabated, with
the consequence that the quantum of the Lessee’s potential liability increased, as did the likelihood
that costs would be awarded against it on an indemnity basis. The inevitable occurred when the
liquidator of the Lessee consented to an order for costs against the Lessee on an indemnity basis on
17 November 2014.
[88] Making allowance for the appellant being a non-​lawyer, and affording him a reasonable
period in which to consider the respondents’ reply evidence, make further enquiries and seek legal
advice, in my view, the appellant acting reasonably should have been in a position to assess and
conclude that the defence and cross claim had no reasonable prospects by no later than the directions
hearing on 30 May 2014. The appellant’s conduct in maintaining the proceedings after that date was
so unreasonable that he should be required to pay the respondents costs from that date to the final
hearing on 17 November 2014.
[89] Acting unreasonably by prolonging litigation with no reasonable prospects also warrants an
indemnity costs order: Colgate-​Palmolive Pty Ltd v Cussons [1993] FCA 536; (1993) 46 FCR 225 at 233-​
234. No argument was advanced by the appellant to the contrary.
[90] Nor was any argument advanced by the appellant that the appointment of the voluntary
administrator on 29 September 2014, or the liquidator on 31 October 2014, in any way affected
the appellant’s responsibility for the respondents’ costs incurred after 29 September 2014. In
any event, if the appellant had acted reasonably and caused the Lessee to consent to judgment
by no later than 30 May 2014, the respondents would not have incurred any further costs after
that date.
[91] The respondents submitted that their costs incurred prior to the date when it became
unreasonable for the appellant to maintain the proceedings, should be included in any costs order
against the appellant (excluding the costs of the preparation of the filing and service of the original
statement of claim). They characterised the appellant’s conduct in maintaining the Lessee’s defence
and cross claim after the Lessee’s solicitors ceased to act in mid-​May 2014, as an “adoption” of those
allegations with the consequence that the costs order should travel back in time and include the
earlier costs incurred by the respondents in responding to the Lessee’s allegations. However, contrary
to the submission by counsel for the respondents, there is no analogy between the present case and
the principles of ratification.
[92] The focus in the present case is on the unreasonable conduct of the non-​party in maintaining
the proceedings which had no prospect of success. If such a finding is made, that conduct cannot be
said to be the cause of the successful party incurring costs at an earlier time before it was unreasonable
for the non-​party to maintain the proceedings.
[93] The adoption argument can be tested another way. If the Lessee, acting reasonably, should
have consented to judgment by no later than 30 May 2011, and had done so, the circumstances
would not have attracted a non-​party costs order against the appellant. Yet, the respondents’ adoption
argument, if accepted, would have the unusual consequence that a non-​party costs order based on
the appellant’s unreasonable conduct from 30 May 2011, would travel back in time and put the
respondents in a better position as against the appellant, than if they had obtained an earlier judgment
against the Lessee. There is no warrant for that outcome. The non-​party costs order should only relate
to the period of time during which the non-​party is found to have acted, relevantly, unreasonably
in maintaining the Lessee’s defence and cross-​claim. Here, in my view, that date commences on
30 May 2014.

158
[3.400]
Costs of Litigation
Chapter 3
SECURITY FOR COSTS
[3.410] The court has power to order a plaintiff to give security for the defendant’s cost of
defending the plaintiff’s claim and can order a stay of proceedings until the security is given. An
application for security for costs should be made promptly. If there is non-​compliance with the
security for costs order, the court may order that the plaintiff’s proceedings be dismissed: see
UCPR r 42.21.
The source of the power comes from rules such as r 2.1 and r 42.21 of the UCPR, s 67 of
the CPA and, in respect of corporations, from s 1335 of the Corporations Act 2001 (Cth). The
Supreme Court also has inherent jurisdiction to order security for costs22 which are necessary
for the due administration of justice and to prevent abuse of the court’s processes.23
Recent New South Wales Court of Appeal decisions that addressed the criteria for
the ordering of security for costs include Singh v De Castro [2017] NSWCA 130; Tonab
Investments Pty Ltd v Optima Developments Pty Ltd [2015] NSWCA 205; Wang v Farkas
(No 6) [2015] NSWCA 116; Yi Cheng Jiang v Wan Ze Property Development (Aust) Pty Ltd
(in Liq) [2014] NSWCA 350; LRSM Enterprise Pty Ltd v Zurich Australian Insurance Limited
[2014] NSWCA 88; Blue Oil Energy Pty Limited v Tan [2014] NSWCA 81; Cornelius v Global
Medical Solutions Australia Pty Ltd [2014] NSWCA 65; Workplace Safety Australia Pty Ltd v
Simple OHS Solutions Pty Ltd [2014] NSWCA 55; Levy v Bablis [2012] NSWCA 128.
Wollongong City Council v Legal Business Centre
[3.420] Wollongong City Council v Legal Business Centre Pty Limited [2012] NSWCA 245
[The appellant, Wollongong City Council, sought leave to appeal from an interlocutory order
dismissing its application for an order for security for costs against the respondent, Legal Business
Centre Pty Ltd (LBC). The New South Wales Court of Appeal granted leave to appeal and held that
the trial judge erred in his assessment of LBC’s financial circumstances and also erred in refusing the
application for security for costs.]
BEAZLEY JA (MEAGHER AND BARRETT JJA AGREEING)
Legal principles governing the making of an order for security for costs
[26] The Uniform Civil Procedure Rules 2005 (UCPR), r 42.21 provides:
42.21 Security for costs
(1) If, in any proceedings, it appears to the court on the application of a defendant:
…
(d) that there is reason to believe that a plaintiff, being a corporation, will be unable to
pay the costs of the defendant if ordered to do so …
the court may order the plaintiff to give such security as the court thinks fit, in such manner as the
court directs, for the defendant’s costs of the proceedings and that the proceedings be stayed until
the security is given.
(2) Security for costs is to be given in such manner, at such time and on such terms (if any)
as the court may by order direct.
22
Fiduciary v Morningstar Research [2004] NSWSC 664 at [34]; Morris v Hanley [2000] NSWSC 957; Bhagat v
Murphy [2000] NSWSC 892; Rajski v Computer Manufacture & Design Pty Ltd [1982] 2 NSWLR 443 at 447–​
448 per Holland J.
23
Rajski v Computer Manufacture & Design Pty Ltd [1982] 2 NSWLR 443 at 447–​448 per Holland J.
[3.420]
159
Civil Procedure in New South Wales
Wollongong City Council v Legal Business Centre cont.
(3) If the plaintiff fails to comply with an order under this rule, the court may order that
the proceeding on the plaintiff’s claim for relief in the proceedings be dismissed.
(4) This rule does not affect the provisions of any Act under which the court may require
security for costs to be given.
[27] The Corporations Act 2001 (Cth), s 1335(1) is in relevantly the same terms:
1335 Costs
(1) Where a corporation is plaintiff in any action or other legal proceeding, the court having
jurisdiction in the matter may, if it appears by credible testimony that there is reason to
believe that the corporation will be unable to pay the costs of the defendant if successful
in his, her or its defence, require sufficient security to be given for those costs and stay all
proceedings until the security is given.
[28] Both sources of power involve the exercise of a discretionary judgment. In approaching its
task in the case of a corporation, the court should adopt a practical commonsense approach to the
examination of the financial affairs of the corporation: Livingspring Pty Ltd v Kliger Partners [2008] VSCA
93; 20 VR 377 at [15].
[29] The principles governing the exercise of the discretion are well established and are relevantly
the same in respect of each source of power: see Livingspring v Kliger Partners at [10]. The party seeking
an order for security for costs (who, for convenience I will refer to as the defendant) bears the onus of
establishing that there is reason to believe that the other party to the litigation will be unable to pay
the costs of the litigation if unsuccessful: see KP Cable Investments Pty Ltd v Meltglow Pty Ltd [1995]
FCA 76; 56 FCR 189; Equity Access Ltd v Westpac Banking Corporation (1989) ATPR 40-​972; Pioneer Park
Pty Ltd (in liq) v Australian and New Zealand Banking Corporation [2007] NSWCA 344; Prynew Pty Ltd v
Nemeth [2010] NSWCA 94.
[30] There is no predisposition to the making of an order: see Bryan E Fencott & Associates Pty Ltd v
Eretta Pty Ltd [1987] FCA 102; (1987) 16 FCR 497 at 509; Interwest Ltd v Tricontinental Corporation Ltd
(1991) 5 ACSR 621 at 623-​624; KP Cable Investments v Meltglow. Once the defendant has discharged
the onus of establishing that there is reason to believe that the other party to the litigation will be
unable to pay the costs of the litigation if unsuccessful, the onus shifts to the party against whom
the order is sought (who I will refer as the plaintiff) to establish a reason why security should not be
granted: KP Cable Investments v Meltglow; Equity Access Ltd v Westpac Banking Corporation; Pioneer Park
v Australia and New Zealand Banking Corporation; Prynew Pty Ltd v Nemeth.
[31] In Staff Development & Training Centre Pty Ltd v Commonwealth of Australia [2005] FCA 1643,
Spender J, at [9]‌, summarised the factors that have been identified in the case law as governing the
exercise of discretion, namely:
(a)
The quantum of risk that a costs order will not be satisfied;
(b)
Whether the making of an order would be oppressive in that it would stifle a reasonably
arguable claim;
(c)
Whether any impecuniosity of the applicant arises out of the conduct complained of;
(d)
The prospects of success;
(e)
Whether there are aspects of public interest which weigh in the balance against such an order;
(f)
Whether there are any particular discretionary matters peculiar to the circumstances of
the case.
[32] Delay is also a relevant factor in determining whether an application for security for costs is to be
made: Commonwealth v Cable Water Skiing (Australia) Ltd (1994) 14 ACSR 760 at 762; Crypta Fuels Pty
Ltd v Svelte Corporation Pty Ltd (1995) 19 ACSR 68 at 71; KP Cable Investments v Meltglow. However,
delay is not of itself a disentitling factor: see Bryan E Fencott v Eretta; Southern Cross Exploration NL v
Fire & All Risks Insurance Co Ltd (1985) 1 NSWLR 114.
160
[3.420]
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Chapter 3
Wollongong City Council v Legal Business Centre cont.
[33] If the plaintiff’s adverse financial circumstances are alleged to be due to the effect of the
defendant’s alleged conduct subject of the claim, the plaintiff bears the onus of establishing the
adequacy of its financial position before the dealings with the defendant and that the defendant’s
conduct either caused, or at least materially contributed to, the plaintiff’s inability to meet an order
for costs: see Fiduciary v Morningstar Research [2004] NSWSC 664; 208 ALR 564 at [100]; Jazabas Pty
Ltd v Haddad [2007] NSWCA 291. Further, where the plaintiff’s claim is based upon a loss of profit,
the court will take a more cautious approach in its consideration of the cause of impecuniosity than
where the claim is based on the infliction of damage: Fat-​sel Pty Ltd v Brambles Holdings Ltd (1985) 3
ACLC 312; ATPR 40-​544 at 46, 428; Jazabas v Haddad at [33].
[34] There is a further matter to which reference should be made. In some cases, persons who
stand behind a plaintiff corporation, or who otherwise stand to benefit from the litigation, may offer
to be responsible for the costs. Should that occur, it may provide a reason for the court to exercise its
discretion in a plaintiff’s favour and not order security: see KP Cable Investments v Meltglow; Intercraft
Cabinets Pty Ltd v Sampas Pty Ltd (1997) 18 WAR 306; Prynew v Nemeth at [33]-​[45].
[35] In the present case, it is apparent that Amir Harb and Habib Harb stand to benefit should the
litigation be successful. However, neither have offered to be responsible in the event a costs order is
made against LBC. In any event, on the evidence, they would not have the financial capacity to be
responsible for the costs.
Reasons of the trial judge
[36] The trial judge’s reasons were relatively brief. His Honour noted that LBC had a total paid-​up
share capital of $4, but commented that that was not of great significance in terms of assessing
the corporate worth of an entity. His Honour noted that LBC owned buildings the subject of the
proceedings and that although the land was the subject of a mortgage and encumbered by a caveat,
he was not convinced at that stage that LBC did not have the capacity to meet an order for costs.
[37] His Honour observed that LBC appeared to be a trust company, the beneficiaries of which
were Amir Harb and Habib Harb. His Honour then concluded:
In all of the circumstances, and they include the significant period that has already elapsed in
these proceedings and the effect of the alleged conduct on the applicant, I am not minded
to exercise the discretion to order security for costs.
[38] His Honour added that his decision might change depending on two matters: first, should
there be further evidence relevant to a security for costs application; and secondly, should there be
a continuation of conduct engaged in by Amir Harb in incurring costs beyond what would normally
be expected. In this regard, his Honour cited correspondence by Amir Harb directly to the Council,
contrary to professional practice, in circumstances where the Council had solicitors acting for it.
The Council’s submissions on the appeal
[39] The Council contended that his Honour, in refusing the application for security, erred in the
following essential respects. First, that he failed to pose and determine the threshold question required
by UCPR, r 42.21 and the Corporations Act, s 1335(1). Secondly, that his Honour failed to correctly
assess the evidence. Thirdly, that his Honour erred in concluding that there were discretionary
considerations that stood against an order for security for costs. Finally, that his Honour failed to give
legally adequate reasons for his decision.
[40] As I have indicated, his Honour’s reasons were brief. His Honour did not engage in any
dissertation of the legal principles but rather dealt directly with the basis upon which the Council
made its application, namely, LBC’s impecuniosity. It was not inappropriate for his Honour to approach
the application in a summary way. He was dealing with the matter during the course of a busy court
day and there is no basis to infer that his Honour misunderstood the legal principles he applied.
Accordingly, I would not uphold the Council’s first complaint. For the same reason, I would reject the
complaint that his Honour did not give legally adequate reasons.
[3.420]
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Civil Procedure in New South Wales
Wollongong City Council v Legal Business Centre cont.
[41] However, I am satisfied that his Honour erred in his assessment of LBC’s financial position and
its ability to meet any costs order made against it. The effect of the evidence to which I have referred
is that LBC, as trustee for the Harb Family Trust, has a net asset value of virtually nil. In other words, its
assets and liabilities are approximately equal. There is no evidence of income other than rental income
but its expenses, most particularly in the form of interest payments, have in most years exceeded, in a
small amount, the amount of income earned from all sources. To the extent that the real beneficiaries
of the proposed development application in respect of the land are Amir Harb and Habib Harb, the
evidence as to their financial position is such that they would not be able to pay any order for costs
made against LBC and neither have made an offer to do so.
[42] Accordingly, I am of the opinion that the Council has satisfied the onus of establishing that
there is reason to believe that LBC and the parties who stand to benefit from any success in the
proceedings will be unable to pay its costs, should the proceedings fail, or should LBC for any reason
be made liable for an order for costs.
[43] LBC submitted that even if the Council had satisfied the preliminary onus under the section,
his Honour correctly exercised his discretion, given the delay in the making of the application and the
fact that it was the conduct of the Council which has caused its impecuniosity.
[44] In the present case there was delay in bringing the application for security for costs. The
amended statement of claim, which was the first legal process served upon the Council, was served
in November 2009. The application for security for costs was not made until 13 January 2012. The
Council submitted, however, that the mere passage of time did not provide a reliable guide as to
the actual delay in the matter. It is submitted that much of the two years delay since the service of the
amended statement of claim upon it was due to inactivity or vacillation on the part of LBC.
[45] In its written submissions to the trial judge, the Council set out a chronology of the procedural
steps in the matter and submitted that the case had not progressed in any substantive way due to
LBC’s conduct. In particular, it is submitted that some 13 months elapsed from the time the Council
filed its defence to the amended statement of claim until LBC served its further amended statement
of claim. During that period of time, LBC was in breach of two procedural court orders. The Council
contended that LBC wasted the totality of 2010 and a significant portion of 2011 in advancing its
claim. The Council pointed out that it first notified its intention to bring an application for security for
costs in September 2011. The same submissions were advanced before this Court.
[46] In my opinion, the Council has delayed in bringing this application. However, delay itself is
not a disentitling factor. In the present case, given that the claim is still at the pleadings stage, I am
satisfied that the delay involved is not such that an order ought not to be made. However, LBC ought
not to be prejudiced by the delay that has in fact occurred. Accordingly, any order for security should
be one in respect of future costs, and not those that have been incurred prior to the bringing of the
application. It should be noted that, subject to including in its assessment those costs in respect of
which orders have already been made in its favour, the Council’s application was in respect of costs
to be incurred in the future.
[47] The final question for determination was whether LBC had discharged its onus of satisfying the
Court that it was the Council’s conduct which caused or materially contributed to its inability to meet
an order for costs. In my opinion, that onus was not discharged. LBC became the registered proprietor
of the land in July 2005. At that time, the development application was subject to proceedings in
the Land and Environment Court. Those proceedings concluded successfully in favour of either Amir
Harb and Habib Harb or LBC on 31 May 2006. It is likely, therefore, that any loss sustained by LBC,
assuming the existence of a duty of care and a breach of that duty by the Council as alleged, is limited
to a period of less than 12 months. Further, there was no evidence to satisfy the Court of the adequacy
of LBC’s financial position before its dealings with the Council. This is true regardless of whether one
considers LBC’s claim as being confined to the period to which I have referred or whether LBC is
able to establish that it was an assignee of any rights that Amir Harb and Habib Harb had against the
Council.
162
[3.420]
Costs of Litigation
Chapter 3
Wollongong City Council v Legal Business Centre cont.
Order for security
[48] It follows, in my opinion, that an order for security should be made. The Court in the exercise
of its discretion is able to make that order itself, or it may remit the matter to the trial court for
determination. In making an order for security, a court will frequently order that security be provided
in tranches, particularly where the case is of some complexity and it is likely to be lengthy, as appears
to be the case here.
[49] In my opinion, the proper course for this Court to take is to make an initial order and to otherwise
remit the matter to the trial court for the making of further orders for security as and when required.
[50] Having regard to the Council’s assessment of the costs likely to be incurred, I am of the
opinion that an appropriate order is for the payment of $100,000 by way of security for costs. This
amount is to provide security for costs for the future conduct of the matter only and excludes any
costs orders made to date. As I have indicated, the Council may approach the Court in the Common
Law Division for a further order should it be so advised.
[51] Accordingly, I propose the following orders in the matter:
1.
Grant leave to appeal;
2.
Appeal allowed;
3.
Quash orders made by the trial judge;
4.
Order that the respondent, Legal Business Centre Pty Limited provide security for costs as
follows:
5.
(1)
by payment of the sum of $100,000 to the Registrar of the Supreme Court (Common
Law Division) or in such other manner as may be agreed by the parties;
(2)
liberty to the appellant, Wollongong City Council, to apply to the Supreme Court for
such further order for security as it sees fit on the giving of 21 days notice;
Order the respondent to pay the appellant’s costs at first instance and on the appeal.

[3.430] Unlike corporations, the fact that a natural person lacks resources is not a sufficient
reason for a security for costs order.
The impecuniosity of the plaintiff is a factor to be weighed in the exercise of the discretion and
is neither a sufficient condition for the ordering of security nor a sufficient condition for the
Court to decline the order for security: Lucas v Yorke (1983) 50 ALR 228 at 228–​9 (Brennan
J); Morris v Hanley [2000] NSWSC 957 at [15]–​[18] (reversed on appeal but not on this point
[2001] NSWCA 374).24
Idoport v National Australia Bank
[3.440] Idoport Pty Ltd v National Australia Bank Ltd; Idoport Pty Ltd & Market Holdings Pty Ltd v Argus
[2001] NSWSC 744
EINSTEIN J
Security for costs
[47] It is clear that the discretion to award security for costs requires to take into account all of the
relevant facts matters and circumstances and is a judicial discretion to be exercised following the
24
Green (as liquidator of Arimco Mining Pty Ltd) v CGU Insurance Ltd [2008] NSWCA 148 at [6]‌.
[3.440]
163
Civil Procedure in New South Wales
Idoport v National Australia Bank cont.
adducing of all evidence by each party to an application seeking to have such an award made. As
Giles J (as His Honour then was) made plain in Rosenfield Nominees Pty Ltd v Bain and Co (1988)
14 ACLR 467 at 470, in exercising the discretion as to whether or not to make an order for costs, the
Court must have a concern to achieve a balance between ensuring that adequate and fair protection
is provided to the defendant, and avoiding injustice to an impecunious plaintiff by unnecessarily
shutting it out or prejudicing it in the conduct of the proceedings [cf Street CJ in Buckley v Bennell
(1974) 1 ACLR 301 at 304]. Giles J referred to the debate over whether the discretion should be
exercised with some predisposition in favour of the defendant and expressed the view with which
I agree, that the debate is largely semantic. The principle which his Honour identified at 470 was that:
the discretion must be exercised having regard to all the circumstances of the case, but the
inability of the plaintiff to meet the costs of the successful defendant, being the occasion
for invoking the exercise of the discretion, is likely to play an important if not decisive role.
[48] Because the discretion to be exercised by the Court is a wide one which should remain unfettered,
the circumstances in which the discretion should be exercised in favour of making the order cannot
and should not be stated exhaustively: Spiel v Commodity Brokers Australia Pty Ltd at 415. In Gentry Bros
Pty Ltd v Wilson Brown and Associates Pty Ltd (1992) 8 ACSR 405, Cooper J stated:
(i)t is not possible or appropriate to list all of the matters relevant to the exercise of the
discretion. The factors will vary from case to case. The weight to be given to any circumstance
depends upon its own intrinsic persuasiveness and its impact on other circumstances which
have to be weighed: PS Chellaram and Mr Courtney v Chine Ocean Shipping Co [1991] HCA
36; (1991) 65 ALJR 642 at 643. (at 415)
[49] Notwithstanding the unfettered nature of the discretion, Beazley J in KP Cable Investments set
out 7 guidelines which the Court is said to typically take into account when determining such an
application:
1.
That such applications should be brought promptly. This is a principle of longstanding: see
Grant v The Banque Franco-​Egyptienne Egyptienne (1876) 1 CPD 143; see also Smail v Burton
(1975) VR 776 per Gillard J at 777; Caruso Australia Pty Ltd v Portec (Aust) Pty Ltd (1984) 8 ACLR
818 at 820; Bryan E Fencott and Associates Pty Ltd v Eretta Pty Ltd (1987) 16 FCR 497 at 514 …
2.
That regard is to be had to the strength and bona fides of the applicant’s case are relevant
considerations: see MA Productions Pty Ltd v Austarama Television Pty Ltd (1982) 7 ACLR 97 at
100; Bryan E Fencott Pty Ltd at 514. As a general rule, where a claim is prima facie regular on its
face and discloses a cause of action, in the absence of evidence to the contrary, the court should
proceed on the basis that the claim is bona fide with a reasonable prospect of success. (Bryan E
Fencott at 514).
3.
Whether the applicant’s impecuniosity was caused by the respondent’s conduct subject of the
claim: see MA Productions Pty Ltd v Austarama Television Pty Ltd at 100.
4.
Whether the respondent’s application for security is oppressive, in the sense that it is being used
merely to deny an impecunious applicant a right to litigate: see MA Productions v Austarama
Television at 100; Yandil Holdings Pty Ltd v Insurance Co of North America (1985) 3 ACLC 542 per
Clarke J at 545; Bryan E Fencott at 513. In Yandil Holdings at 545 Clarke J stated the principle in
these terms:
(t)he fact that the ordering of security will frustrate the plaintiff’s rights to litigate its claim
because of its financial condition does not automatically lead to the refusal of an order.
Nonetheless it will usually operate as a powerful factor in favour of exercising the court’s
discretion in the plaintiff’s favour.
This factor is related to the next, namely:
5.
Whether there are any persons standing behind the company who are likely to benefit from the
litigation and who are willing to provide the necessary security: see Memetu v Lissenden (1983)
164
[3.440]
Costs of Litigation
Chapter 3
Idoport v National Australia Bank cont.
8 ACLR 364; Sent v Jet Corporation (1984) 2 FCR 201; Bell Wholesale Co Pty Ltd v Gates Export
Corporation (1984) 2 FCR 1; Hession v Century 21 South Pacific Ltd (1992) 28 NSWLR 120 at 123;
Bryan E Fencott at 513; Yandil Holdings at 545. The combined effect of these two principles was
summarised by Meagher JA in Hession at 123 as follows:
[A]‌company in liquidation against whom an order for security for costs is sought cannot
successfully resist such an order merely by proving that it cannot fund the litigation from
its own resources if an order for security is made; it must prove that it cannot do so even if
it relies on the other resources available to it (the company’s shareholders or creditors) …
Finally, whilst it is both true and important that poverty must be no bar to litigation, what
that means is that the courts must be astute to see that no person pursuing a claim which is
not frivolous is precluded from doing so by the erection of obstacles which poverty is unable
to surmount; it does not mean that proof of insolvency automatically confers an immunity
from statutory provisions which deal with insolvent plaintiffs.
6.
An issue related to the last guideline is whether persons standing behind the company have
offered any personal undertaking to be liable for the costs and if so, the form of any such
undertaking: see Cameron’s Unit Services Pty Ltd v Kevin R Whelpton and Associates (Aust) Pty Ltd
(1986) 13 FCR 46 at 53; Mantaray Pty Ltd v Brookfield Breeding Co Pty Ltd (1990) 8 ACLC 304;
Clyde Industries Ltd v Ryad Engineering Pty Ltd (1993) 11 ACLC 325.
7.
Security will only ordinarily be ordered against a party who is in substance a plaintiff, and an
order ought not to be made against parties who are defending themselves and thus forced to
litigate: see Interwest Ltd v Tricontinental Corporation Ltd (1991) 5 ACSR 621 at 626; Heller Factors
Pty Ltd v John Arnold’s Surf Shop Pty Ltd (in liq) (1979) ACLC 32,446; Sydmar Pty Ltd v Statewise
Developments Pty Ltd (1987) 5 ACLC 480; Weily’s Quarries v Devine Shipping Pty Ltd (1994) 14
ACSR 186 where Zeeman J stated at 189:
(t)he general proposition that security ought not to be ordered where the proceedings are
defensive in the sense of directly resisting proceedings already brought or seeking to halt
self-​help procedures is no more than that, a general proposition. It ought not to be elevated
to being a rule of law. In many cases of that nature it could be considered oppressive to
require security and that in itself may be sufficient to refuse to make an order … (see)
Sydmar Pty Ltd v Statewise Developments (supra) and Interwest Ltd v Tricontinental (supra).
(at para 39)
[50] Clearly as Beazley J recognised, the possibility of stultification is a “powerful” factor to be taken
into account by the Court in exercising its discretion as to whether an order is appropriate: Yandil
Holdings Pty Ltd v Insurance Co of North America (1985) 3 ACLC 542. However, Clarke J in Yandil
observed that the fact that a plaintiff is financially unable to provide security does not lead to the
inevitable conclusion that the making of the order will stultify the plaintiff’s claim nor does it lead
to the automatic refusal of an order. He went on to cite a line of authorities (see Tulloch v Walker,
Yeldham J, 8 December 1976, unreported; Bell Wholesale Co Pty Ltd v Gates Export Corp (No 2)
(1984) 8 ACLR 588) in support of the view that it is generally inappropriate to refuse an order for
security where:
the personnel behind the corporate plaintiff, or other parties who will benefit if the plaintiff
succeeds, are financially able to provide adequate security. (at 545)
In other words, without fettering the Court’s discretion, it was said to be unlikely that a plaintiff
could successfully resist a security order on the grounds of their own impecuniosity in the absence of
evidence of the financial status of those who stand behind it (see Yandil at 545).
[51] McHugh J in Oshlack also made plain at 97 that:
[T]‌he jurisdiction to award security for costs should thus be seen as protecting the efficacy
of the exercise of the jurisdiction to award costs. The discretion should be exercised with the
[3.440]
165
Civil Procedure in New South Wales
Idoport v National Australia Bank cont.
same rationales in mind, namely that, to the extent it can be avoided, the court should not
permit a situation to arise where a party’s success is pyrrhic.
[52] The purpose of a security for costs order is therefore a protective jurisdiction to ensure that the
primary purposes for having costs orders themselves, can be achieved. A defendant is protected
against the risk that a costs order obtained at the end of the day may turn out to be of no value by
reason of the impecuniosity of the plaintiff. The jurisdiction therefore assists both the compensation
purpose as well as the public interest objective.
Plaintiffs: natural persons vs corporations
[53] In relation to natural person plaintiffs, the mere fact that the plaintiff is impecunious does not provide
a gateway into security for costs. However with respect to a corporation it has long been established
in terms of the Corporations Act and its predecessors, and the rules of court as well as the inherent
jurisdiction, that if there is good reason to believe that the corporation may be unable to pay costs at
the end of the day, this provides a gateway by which an application for security for costs may be made.
[54] Giles CJ in Rugby Union Players Association [30/​
7/​
1997, SCNSW, 50225/​
96, unreported]
described the rationale behind the exceptions to the general rule that the impecuniosity of a plaintiff
should not be a ground for making an order for security for costs (this principle having been well
established by the authorities in relation to plaintiffs who are natural persons: Cowell v Taylor (1885)
31 Ch D 34), in the following terms:
In both cases the rationale is that those who will benefit from success in the proceedings, as
shareholders in or creditors of a corporation or as third parties for whose benefit the plaintiff
(whether a natural person or a corporation) sues, should not be able to litigate and expose
the defendant to the risk of irrecoverable costs while themselves shielded, by reason of the
interposition of the impecunious plaintiff, from the burden of an adverse order for costs. (at 11)
[55] The Court in Harpur v Ariadne [1984] 2 Qd.R 523 at 532 described the rationale behind this
principle in the following terms:
The mischief at which the provision is aimed is obvious. An individual who conducts his
business affairs by medium of a corporation without assets would otherwise be in a position
to expose his opponent to a massive bill of costs without hazarding his own assets. The
purpose of an order for security is to require him, if not to come out from behind the skirts
of the company, at least to bring his own assets into play.
[56] The inability of a plaintiff company to pay the costs of the defendant not only opens the
jurisdiction for the giving of security, but also provides a substantial factor in the decision whether to
exercise it: Pearson v Naydler [1977] 1 WLR 899 at 906; cited with approval in Sent v Jet Corporation of
Australia Pty Ltd (1984) 2 FCR 201 at 215.
[57] Where a winding-​up order has been made in relation to the plaintiff company on account of
its insolvency, the company will not prima facie be in a position to pay any costs ordered against it.
The Court will generally treat this circumstance as a special factor justifying the making of an order for
security for costs: Tricorp Pty Ltd (in liq) v Deputy Commissioner of Taxation (WA) 10 ACLC 474 at 475.
[58] In considering an application under s 1335, the Court is required to form an opinion about
what the financial position of the plaintiff will be at the time of judgment and immediately after. An
important consideration will be the financial position of the plaintiff at the time of the application,
however this is not the sole consideration. Other factors may include the outcome of the trial, the costs
associated with the trial and the success or otherwise of its business and investments in the meantime.
When the Court is required to make a judgment involving the anticipation of future events, it must
consider the degree of probability that a particular event might occur: Beach Petroleum NL v Johnson
(1992) 10 ACLC 525 at 526–​527.
[59] With specific regard to security for costs against corporations, the Court in Pearson v Naydler
recognised that the basic notion of security for costs empowers the Court to order the plaintiff to do
166
[3.440]
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Idoport v National Australia Bank cont.
something that it will likely find difficult to do, ie to provide security for the costs which ex hypothesi
it is likely to be unable to pay. Despite this, the Court noted that this discretionary power should not
be used as an instrument of oppression “by shutting out a small company from making a genuine
claim against a large company” (see also Equity Access Limited v Westpac Banking Corporation (1989)
11 ATPR 40-​972 at 50,635). The Court must thereby strike a balance between this consideration and
the notion that:
the court must not show such a reluctance to order security for costs that this becomes a
weapon whereby the impecunious company can use its inability to pay costs as a means of
putting unfair pressure on a more prosperous company. Litigation in which the defendant
will be seriously out-​of-​pocket even if the action fails is not to be encouraged. While I accept
that there is no burden of proof one way or the other, I think that the court ought not to be
unduly reluctant to exercise its power to order security for costs in cases that fall squarely
within the section. Pearson v Naydler at 906–​907.
Burden of proof
[60] Whilst from one point of view it may seem inappropriate to approach the matter in terms of
the strictures of burden of proof whether of a legal or forensic character [cf discussion in Mummery
v Irvings [1956] HCA 45; (1956) 96 CLR 99 at 118ff], there is certainly substantial authority which is
followed in these reasons, to the effect that the defendants, as applicants for security for costs, have
an evidentiary burden of leading evidence to establish a prime facie [sic] entitlement to such an order
and to such an order in relation to a particular amount. Normally, in any court, the party who asserts
must prove in order to succeed: Scott Fell v Lloyd (Official Assignee) [1911] HCA 34; (1911) 13 CLR 230
at 241; Bankinvest AG v Seabrook (1988) 14 NSWLR 711 at 717 per Kirby P. In Warren Mitchell Pty Ltd v
Australian Maritime Officers Union (1993) 12 ACSR 1 the word “credible” in s 1335 was said to suggest
that an evidentiary burden is undertaken by the party seeking the order who must show:
that the material before the Court is sufficiently persuasive to permit a rational belief to be
formed that, if ordered to do so, the corporation would be unable to pay the costs of that
party upon disposal of the proceedings.
[61] The evidence to be relied on must have some characteristic of cogency. Furthermore, speculation
as to the insolvency or financial difficulties experienced by the plaintiff company is insufficient to
ground the exercise of the discretion: Warren Mitchell Pty Ltd v Australian Maritime Officers Union.
[62] The approach followed in these reasons is that once the defendants have led evidence to
establish the above described entitlement, an evidentiary onus falls upon the plaintiffs to satisfy the
Court that taking into account all relevant factors, the Court’s discretion ought be exercised by either
refusing to order security or by ordering security in some lesser amount than was sought by the
defendants.

[3.450] A security for costs order is discretionary and though such discretion is absolute and
unfettered,25 it will not be made automatically.26 It must not be made “arbitrarily, capriciously
or so as to frustrate the legislative intent”.27 It must be exercised judicially.28
25
26
27
28
Merribee Pastoral Industries Pty Ltd v Australia & New Zealand Banking Group Ltd [1998] HCA 41; 193 CLR 502
at [26]; Lucas v Yorke (1983) 50 ALR 228 at 228–​229.
Barton v Minister for Foreign Affairs (1984) 2 FCR 463; 54 ALR 586.
Oshlack v Richmond River Council (1998) 193 CLR 72; 72 ALJR 578; 152 SLR 83; [1998] HCA 11 at [22].
See generally Hamilton JP, Lindsay G, Morahan M and Webster C (eds), NSW Civil Procedure Handbook
(Lawbook Co, 2018) (UCPR Part 42, Commentary).
[3.450]
167
Civil Procedure in New South Wales
UCPR r 42.21 provides the circumstances in which a plaintiff can be ordered to pay security
for costs. The establishment of one of the circumstances is not necessarily sufficient by itself
to justify an order.
Uniform Civil Procedure Rules 2005 (NSW)
[3.460] Uniform Civil Procedure Rules 2005 (NSW) rr 2.1, 42.21
Case management generally
2.1 Directions and orders
(cf SCR Pt 26, r 1)
The court may, at any time and from time to time, give such directions and make such orders for
the conduct of any proceedings as appear convenient (whether or not inconsistent with these rules or
any other rules of court) for the just, quick and cheap disposal of the proceedings.
Note: See also the guiding principles in relation to the conduct of court proceedings (set out
in Division 1 of Part 6 of the Civil Procedure Act 2005) and the general powers of the court to give
directions (set out in Division 2 of that Part).
Division 6 Security for Costs
42.21 Security for costs
(cf SCR Pt 53, rr 2, 3, 4 and 5; DCR Pt 40, r 1; LCR Pt 31, r 11A, Pt 31A, r 11)
(1)
If, in any proceedings, it appears to the court on the application of a defendant:
(a)
that a plaintiff is ordinarily resident outside Australia, or
(b)
that the address of a plaintiff is not stated or is mis-​stated in his or her originating
process, and there is reason to believe that the failure to state an address or the mis-​
statement of the address was made with intention to deceive, or
(c)
that, after the commencement of the proceedings, a plaintiff has changed his or her
address, and there is reason to believe that the change was made by the plaintiff with
a view to avoiding the consequences of the proceedings, or
(d)
that there is reason to believe that a plaintiff, being a corporation, will be unable to pay
the costs of the defendant if ordered to do so, or
(e)
that a plaintiff is suing, not for his or her own benefit, but for the benefit of some other
person and there is reason to believe that the plaintiff will be unable to pay the costs
of the defendant if ordered to do so, or
(f)
that there is reason to believe that the plaintiff has divested assets with the intention of
avoiding the consequences of the proceedings,
the court may order the plaintiff to give such security as the court thinks fit, in such manner
as the court directs, for the defendant’s costs of the proceedings and that the proceedings be
stayed until the security is given.
(1A)
In determining whether it is appropriate to make an order that a plaintiff referred to in
subrule (1) give security for costs, the court may have regard to the following matters and
such other matters as it considers relevant:
168
(a)
the prospects of success or merits of the proceedings,
(b)
the genuineness of the proceedings,
(c)
the impecuniosity of the plaintiff,
(d)
whether the plaintiff’s impecuniosity is attributable to the defendant’s conduct,
[3.460]
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Uniform Civil Procedure Rules 2005 (NSW) cont.
(e)
whether the plaintiff is effectively in the position of a defendant,
(f)
whether an order for security for costs would stifle the proceedings,
(g)
whether the proceedings involves a matter of public importance,
(h)
whether there has been an admission or payment in court,
(i)
whether delay by the plaintiff in commencing the proceedings has prejudiced the
defendant,
(j)
the costs of the proceedings,
(k)
whether the security sought is proportionate to the importance and complexity of the
subject matter in dispute,
(l)
the timing of the application for security for costs,
(m)
whether an order for costs made against the plaintiff would be enforceable within
Australia,
(n)
the ease and convenience or otherwise of enforcing a New South Wales court judgment
or order in the country of a non-​resident plaintiff.
(1B)
If the plaintiff is a natural person, an order for security for costs cannot be made merely on
account of his or her impecuniosity.
(2)
Security for costs is to be given in such manner, at such time and on such terms (if any) as the
court may by order direct.
(3)
If the plaintiff fails to comply with an order under this rule, the court may order that the
proceeding on the plaintiff’s claim for relief in the proceedings be dismissed.
(4)
This rule does not affect the provisions of any Act under which the court may require security
for costs to be given.

Civil Procedure Act 2005 (NSW)
[3.470] Civil Procedure Act 2005 (NSW) s 67
67 Stay of proceedings
(cf Act No 9 1973, s 156)
Subject to rules of court, the court may at any time and from time to time, by order, stay any
proceedings before it, either permanently or until a specified day.

[3.480] The Supreme Court has inherent jurisdiction to order security for costs, although the
powers of the District Court and Local Court in this regard are restricted to statute.29 The
following case extract of Welzel v Francis [2011] NSWSC 477 illustrates an occasion when
inherent jurisdiction was used as the power to make a security for costs order.
29
Rajski v Computer Manufacture & Design Pty Ltd [1982] 2 NSWLR 443; Bhagat v Murphy [2000] NSWSC 892;
Philips Electronics Australia Pty Ltd v Matthews (2002) 54 NSWLR 598 at [50]–​[53].
[3.480]
169
Civil Procedure in New South Wales
Welzel v Francis
[3.490] Welzel v Francis [2011] NSWSC 477
BALL J
Background
[1]‌By a notice of motion dated 3 March 2011, the defendant, Mr Francis, seeks an order that the first
plaintiff, Mr Welzel, provide further security for his costs in these proceedings.
[2]‌The proceedings arise out of an agreement reached between Mr Welzel and Mr Francis some
time in the second half of 2001 …
[4]‌On 30 October 2009, Mr Francis filed a notice of motion seeking, among other things, an order
that Mr Welzel provide security for Mr Francis’s costs. That motion was heard by Bergin CJ in Eq on
27 November 2009, at which time her Honour ordered that Mr Welzel provide security in the sum of
$25,000 …
[5]‌The current application is made primarily on the basis that Mr Francis has become aware of facts
that were not known at the time Bergin CJ in Eq ordered security which suggest that Mr Welzel had
taken other steps to divest himself of assets so that they will not be available to meet any judgment in
relation to costs and that Bergin CJ in Eq was misled in that regard. However, Mr Francis also relies on
evidence that the estimated costs of the case have increased substantially since security was ordered
by Bergin CJ in Eq …
Relevant legal principles
[7]‌Before dealing with the application, it is necessary to say something about the relevant legal
principles. The notice of motion seeks an order that Mr Welzel provide additional security. That order
is sought pursuant to UCPR r 42.21 or alternatively s 1335(1) of the Corporations Act or alternatively
the court’s inherent jurisdiction. Section 1335(1) of the Corporations Act can be put to one side. It only
gives power to the court to order security against a corporation. Here, however, security is sought
from Mr Welzel.
[8]‌UCPR r 42.21(1) provides: [the rule thereafter extracted]:
None of (a) to (e) applies in this case. Consequently, security for costs cannot be awarded
under UCPR r 42.21.
[9]‌However, in Rajski v Computer Manufacture & Design Pty Ltd [1982] 2 NSWLR 443, Holland J
held that the court retained its inherent jurisdiction to order security for costs against a plaintiff
notwithstanding legislative provisions which permitted a defendant to obtain security for costs in
certain circumstances. In particular, the inherent jurisdiction to order security against a plaintiff was
not affected by Pt 53 r 2(1) of the Supreme Court Rules, which has now been superseded by, but
which was in substantially the same terms as, UCPR r 42.21. That jurisdiction was an aspect of the
court’s inherent power to regulate its own practice and procedure “to procure proper and effective
administration of justice and prevent abuse of process” (at 447). In Rajski, proceedings had been
brought by Dr Rajski and Raybos Pty Ltd, a company controlled by him, against the defendant. The
defendant sought security for its costs. That application was contested on the basis that the court had
no power to order security against Dr Rajski, or against Raybos in circumstances where its co-​plaintiff
was a natural person. Holland J rejected that submission. There was evidence that Dr Rajski had
denuded Raybos of approximately $275,000 before the proceedings were commenced and that most
of that money had gone to Dr Rajski’s mother, with whom Dr Rajski resided. In those circumstances,
his Honour thought that it was appropriate to order security against both Raybos and Dr Rajski.
[10] The decision of Holland J was affirmed on appeal (see Rajski v Computer Manufacture & Design
Pty Ltd [1983] 2 NSWLR 122) and has been applied in a number of subsequent cases: see, for example,
Bhagat v Murphy [2000] NSWSC 892; Byrnes v John Fairfax Publications Pty Ltd [2006] NSWSC 251. In
the former case, there had been a large number of interlocutory applications and, although Young J
170
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Welzel v Francis cont.
thought that Mr Bhagat had a glimmer of a good case, that glimmer was “very much obscured by
the vast amount of irrelevancies thrown up around it” (at [19]). The defendant made an application
for security for costs. Mr Bhagat originally refused to give any evidence concerning his personal assets
in opposition to that application. When he was informed by Young J that, in those circumstances, his
Honour would award security against him, Mr Bhagat gave evidence that he had no assets. However,
under cross-​examination he conceded that he lived with his wife in an apartment in the Connaught,
although he gave evidence that he had no idea who owned the apartment or how his occupation
of it was funded. He also conceded that he had been the beneficial owner of 760,000 units in Estate
Mortgage Depositors Trust No 4, although he had disposed of most of those units to his wife, and
that he owned some property in Poona, India. Taking those matters into account Young J ordered that
Mr Bhagat provide security in the sum of $300,000. In the latter case, Simpson J (at [17]) observed that
the adoption of the Uniform Civil Procedure Rules did not affect the conclusions reached by Holland J
in Rajski in relation to the existence of the inherent power to order a plaintiff to provide security or
the principles that should be applied by the court in determining whether to exercise that power.
Clearly, one type of case where it may be appropriate for the court to order security in exercise of its
inherent power is where the plaintiff has taken steps to divest himself or herself of assets to avoid the
consequences of an adverse costs order.
…
[12] Several other principles are relevant in this case.
[13] First, one matter that is very relevant to the exercise of the court’s power to order security is
whether the effect of the order would be to stultify the proceedings. Generally, a court should not
make an order for security that would have that consequence: Hession v Century 21 South Pacific Ltd
(in liq) (1992) 28 NSWLR 120. However, it is for the party resisting an order for security to establish
that the order is likely to have that effect, and in doing so that party must establish that those who
stand behind the party in the proceedings are not in a position to contribute to any order for security.
As the Full Federal Court said in Bell Wholesale Co Ltd v Gates Export Corporation (1984) 52 ALR 176
at 179–​80:
In our opinion a court is not justified in declining to order security on the ground that to
do so will frustrate the litigation unless a company in the position of the appellant here
establishes that those who stand behind it and who will benefit from the litigation if it is
successful (whether they be shareholders or creditors or, as in this case, beneficiaries under
a trust) are also without means. It is not for the party seeking security to raise the matter;
it is an essential part of the case of a company seeking to resist an order for security on
the ground that the granting of security will frustrate the litigation to raise the issue of the
impecuniosity of those whom the litigation will benefit and to prove the necessary facts.
As Austin J pointed out in Fiduciary Ltd v Morningstar Research [2004] NSWSC 664; (2004)
208 ALR 564 at [77], that statement of principle was approved by McHugh J in PS Chellaram
& Co Ltd v China Ocean Shipping Co [1991] HCA 36; (1991) 102 ALR 321 at 3 23 and by the
New South Wales Court of Appeal in Hession v Century 21 South Pacific Ltd (in liq) (1992) 28
NSWLR 120. There is no reason why it should not apply equally to an application for security
against a natural person.
[14] Second, a court will not generally order a plaintiff to provide security where the plaintiff’s
impecuniosity has been brought about by the defendant’s conduct: Lynnebry Pty Ltd v Farquhar
Enterprises Pty Ltd (1977) 3 ACLR 133. There must, however, be “a real causal connection between the
conduct and the impecuniosity which, in the exercise of the Court’s discretion, would make it unjust
to require security”: Dalma Formwork Pty Limited (Administrator Appointed) v Concrete Constructions
Group Limited [1998] NSWSC 472 per Rolfe J.
[15] Third, it is relevant to take into account whether the plaintiff’s claim has reasonable prospects
of success. Generally, however, it is the absence of reasonable prospects of success that provides a
reason for ordering security. The existence of reasonable prospects does not of itself provide a reason
[3.490]
171
Civil Procedure in New South Wales
Welzel v Francis cont.
for refusing security; and the court will not embark on a detailed consideration of the merits of
the case in determining whether an order for security is appropriate: see Fiduciary Ltd v Morningstar
Research [2004] NSWSC 664; (2004) 208 ALR 564 at [37]–​[38] per Austin J. Other matters may also
be relevant, such as delay in making the application and the conduct of the parties in connection with
the proceedings: see Bhagat v Murphy [2000] NSWSC 892.
[16] Fourth, different principles apply depending on whether the application is a fresh application
for additional security or an application to vary an existing order granting security: Ingot Capital
Investments Pty Ltd v Macquarie Equity Capital Markets Ltd (No 5) [2006] NSWSC 255 at [9]‌ff per
McDougall J. Where the application is an application to vary an existing order, the applicant must
satisfy the requirements identified by McLelland J in Brimaud v Honeysett Instant Print Pty Ltd (1988)
217 ALR 44. An obvious example is where an application is made to set aside the original order for
security. Another example is where it is clear that the original order was in respect of the total costs of
the case. However, I do not think that it follows from that that the respondent to the application for
additional security is limited to raising arguments in opposition to the application that were raised at
the time security was sought originally. For example, there is no reason why a respondent should be
prevented from submitting that further security will stultify the proceedings or that the respondent’s
impecuniosity was brought about by the applicant, even if those grounds were not raised in opposition
to the original application.
Should additional security be ordered?
[17] Mr Welzel resists an application for further security on three main bases. First, he says that
security should not be awarded against him as a personal plaintiff. Second, he says that any award
of security will stultify the proceedings. Third, he says that Mr Francis’s conduct has caused the
impecuniosity of the corporate plaintiffs. During the course of the hearing, Mr Gration, who
appeared for the plaintiffs, also placed considerable emphasis on the allegations against Mr Francis
and, in particular, what was said to be a strong case that Mr Francis had appropriated what was
meant to be a joint business to himself and had gone to considerable lengths to put that business
out of the reach of the plaintiffs. He also submitted that Mr Francis had been guilty of extraordinary
delay in the proceedings –​in particular, in giving discovery, and that that should affect the court’s
attitude to security.
[18] In my opinion, the critical question in this case is whether Mr Welzel has taken steps to put
his assets out of Mr Francis’s reach in the event that Mr Francis is successful in the case and obtains a
costs order in his favour. If Mr Welzel has done that, then I do not think that the other factors provide
a reason for refusing an order for further security, although they may be very relevant to the amount
of security that should be ordered. I say that for several reasons.
[19] First, there is obviously a connection between the stultification argument and the question
whether a plaintiff has disposed of assets to avoid the consequences of a costs order. In principle, the
amount of any security should reflect the assets that it might have been expected the plaintiff would
have had available to meet a costs order but for the disposition of those assets to avoid having to meet
the costs order from them. The purpose of an order for security for costs is not to punish the plaintiff
for disposing of the assets to avoid the consequences of a costs order. It is to put the defendant in
the position it could have expected to be in if the assets had not been disposed of. The assumption
underlying this approach is that, if the assets were disposed of to avoid the consequences of a costs
order, then those to whom they were disposed ought to be willing to make them available to enable
the action to continue. Two other points should be made in this context. The first is that difficulties
may arise in determining the amount of security that is appropriate where the plaintiff has not given
a full account of the assets that he or she owns. However, those difficulties cannot prevent the court
from fixing an appropriate sum. If they were permitted to do so, the plaintiff would have achieved
the very object that the order for security was intended to prevent. The second is that, in fixing the
amount of security, it is necessary to make allowance for the fact that some of the assets in question
may be needed to pay the plaintiff’s own legal costs.
172
[3.490]
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Welzel v Francis cont.
[20] Second, so far as the impecuniosity argument is concerned, the relevant question is whether
Mr Francis’s alleged conduct caused Mr Welzel’s impecuniosity, since it is from him that security is
sought. Once that is accepted, impecuniosity becomes an irrelevant factor. If Mr Welzel is impecunious
because he disposed of his assets, then he should provide security; and the amount of that security
should fairly reflect the position the parties would have been in if Mr Welzel had not disposed of those
assets. Mr Welzel should not be required to supply more security than that. Consequently, whether
Mr Welzel would have been better off but for Mr Francis’s alleged breaches, even assuming that could
be described as a form of impecuniosity for the purpose of the principle, is irrelevant.
[21] Third, it cannot be disputed that Mr Welzel has a reasonably arguable case. Moreover, there
is evidence to suggest that Mr Francis has engaged in the very activities that he accuses Mr Welzel
of engaging in. In particular, it seems at least arguable that Mr Francis dissolved OpenIN Limited
and set up alternative companies through which to conduct his business as a means of defeating
Mr Welzel’s claim. However, the fact that Mr Welzel has a reasonably arguable case is, as I have said,
not a reason for refusing security if it should otherwise be ordered and I do not think Mr Francis’s
conduct is a ground on which Mr Welzel can justify his own. If Mr Francis has sought to avoid the
consequences of a judgment against him, then that may justify other orders, but it does not provide
a reason for not making an order for security if one otherwise should be made. On the other hand, in
my opinion, Mr Francis’s conduct in the litigation is relevant to the amount of any security that should
be ordered. There is evidence that Mr Francis has delayed excessively in complying with the court’s
orders –​in particular, the order in relation to discovery. That is likely to have increased the costs of the
proceedings. That is one matter that the court should take into account in determining the amount
of any security.
…
[25] In my opinion, there is sufficient evidence to conclude that Mr Welzel has disposed of assets
in order to avoid the consequences of a costs judgment. It is unclear whether Mr and Mrs Welzel
have separated or not. However, even if they have, it is clear that their financial affairs are closely
connected and that they have co-​operated closely in relation to them. Mr Welzel has disposed of all of
the significant assets that he concedes he once had an interest in –​in the case of the house at Dural,
to a discretionary trust of which he is a beneficiary. He has also effectively disposed of his income to
a company controlled by his wife. He did so shortly before the proceedings were commenced. Even
assuming that he and his wife separated at that time, the timing of the transactions and the extent
to which Mr Welzel alienated his assets and income strongly suggest that an important reason for
doing so was to insulate them from a costs order against him. Moreover, neither Mr Welzel nor his
wife have given any explanation of how FIAP, as trustee of the 3B Property Trust 2, had funds to
acquire the property at Buddina. In circumstances where Mr Welzel is a discretionary beneficiary of
that trust, it would have been necessary to disclose that fact to Bergin CJ in Eq in order to give a full
picture of his financial position. The fact that he did not do so together with the fact that neither he
nor his wife have offered any explanation of the source of the funds strongly suggest that, directly or
indirectly, the source of some or all of the funds was Mr Welzel. That inference is reinforced by the
fact that Mrs Welzel earns no income of her own. It is also reinforced by the fact that amounts that
Mr Welzel admits are due to the corporate plaintiffs appear to have been paid to Welzel Systems and
then disbursed to Mrs Welzel and the fact that neither Mr nor Mrs Welzel have offered any explanation
for the margin lending account with Macquarie Bank. Taking these matters together, in my opinion,
the only conclusion is that Mr Welzel contributed a substantial proportion of the funds used to buy
the Buddina property.
[26] It follows, in my opinion, that Mr Welzel ought to provide further security in respect of
Mr Francis’s costs. I will hear the parties in relation to the amount of that security and the costs of the
motion.

[3.490]
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Civil Procedure in New South Wales
PROPOSALS FOR CONTAINING COSTS
[3.500] In 2007, Hamilton J30 discussed measures available under the CPA and the UCPR for
containing costs. The following is an extract from his Honour’s paper.
Containment of Costs: Litigation and Arbitration
[3.510] Justice John P Hamilton, Containment of Costs: Litigation and Arbitration
2 The power to cap party/​party costs
[T]‌here are three sets of provisions now available in NSW courts. I shall also refer to the English
experience and a local proposal for costs capping which require consideration under this head.
…
2.1 Cost capping: UCPR r 42.4
This power has been available for some time in the NSW courts but has been little used. The central
provision in r 42.4(1) is that the Court may, of its own motion or on the application of a party, make
an order specifying the maximum costs that may be recovered by one party from another. Its ambit
was discussed by Palmer J in Re Sherborne Estate (No 2): Vanvalen v Neaves (2005) 65 NSWLR 268;
[2005] NSWSC 1003. That case involved three claims for provision under the Family Provision Act 1982
(“the FPA”). Two were successful and one failed. There was a multiplicity of issues about costs. The
defendant alleged that the costs of the successful plaintiffs were excessive, and sought a cost capping
order under r 42.4 to limit the costs that the successful plaintiffs could recover. His Honour ruled that
a costs capping order under r 42.4 was available only prospectively and not in respect of costs already
incurred. His Honour said at [23]–​[26] and [31]:
[23] This Rule reproduces the former SCR 52A r 35A. Neither Counsel’s researches nor my
own have found any case in which this rule has been discussed or applied.
[24] While UCPR 42.4(1), read in isolation, would seem to empower the Court to fix a
maximum sum recoverable by one party under a costs order to be made against another
party, the terms of sub-​rules (2) and (3) suggest that an order under sub-​rule (1) may be
made only in advance of a hearing, in order to set limits to what parties may ultimately
expect to recover in costs at the end of the day if the proceedings are conducted with due
economy and in accordance with the Court’s directions. This intention emerges from the fact
that a maximum costs order under sub-​rule (1) is not to limit costs occasioned by breaches
of the Court’s directions, amendments to pleadings AND applications to extend time nor
costs resulting from what may generally be described as vexatious conduct by a party in the
progress of a matter to trial or during the course of a trial: sub-​rule (2).
[25] Further, sub-​rule (3) envisages that an order under sub-​rule (1) will be made at the same
time as directions for the progress of the matter towards trial. Sub-​rule (4) envisages that a
maximum costs order may be varied by reason of circumstances which have occurred after
the date that the order was first made. Such a change of circumstances could rarely, if ever,
occur at the time that the Court was pronouncing a final costs order at the conclusion of the
proceedings.
[26] I conclude that UCPR 42.4 is intended as a means whereby the Court may, if the need
arises, curb the tendency of one or all parties to engage in disproportionate expenditure on
legal costs by making it clear, at an early stage of the proceedings, that beyond a certain limit
the parties will have to bear their own costs –​win or lose. …
…
30
The Honourable Mr Justice Hamilton JP, Containment of Costs: Litigation and Arbitration (Supreme Court of
New South Wales, 1 June 2007).
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Containment of Costs: Litigation and Arbitration cont.
[31] … the remedy provided by UCPR 42.4 is prophylactic: it cannot be used as a cure
for excessive expenditure at the time of making a final costs order at the conclusion of
proceedings: other powers of the Court must be engaged.
I cannot trace a subsequent case in which the NSW cost capping rule has been put to the use
anticipated as valid by Palmer J. However, there are similar provisions in the rules of the Federal Court
of Australia and the Federal Magistrates Court: see FCR O 62A r 1; FMCR r 21.03. The use of the
Federal Court rule was discussed by Drummond J in Hanisch v Strive Pty Ltd (1997) 74 FCR 384. His
Honour ruled that the Court was not empowered by O 62A r 1 to fix the maximum costs recoverable
by one party only, should it succeed, but must fix the maximum costs recoverable by both. His
Honour said at 387–​388:
The principal object of O 62A is to arm the Court with power to limit the exposure to
costs of parties engaged in litigation in the Federal Court which involves less complex issues
and is concerned with the recovery of moderate amounts of money, although it may be
appropriate for an order to be made under O 62A in other cases, of which Woodlands v
Permanent Trustee Co Ltd (1995) 58 FCR 139 is an example. See Sacks v Permanent Trustee
Australia Ltd (1993) 45 FCR 509 at 512.
In the particular case his Honour declined to fix maximum amounts recoverable by reference to an
amount. But, being of the view that the action should have been brought in the District Court, his
Honour limited the costs recoverable to those that would be recoverable on a party/​party taxation in
an action in that Court.
In the Federal Magistrates Court, application was made in Flew v Mirvac Parking Pty Ltd [2006] FMCA
1818 under r 21.03 to limit the costs recoverable as between the parties in a disability discrimination
case to $5000. Barnes FM declined to make the order. His Honour referred to the limited scale on
which costs in the Federal Magistrates Court are usually allowed. In short, his Honour ruled that there
was nothing to take this case out of the ordinary run.
2.2 Cost capping: the English experience
In England of recent times there has been a bold endeavour developed in the courts relating to the
capping of costs. This is not based on any direct provision of legislation or rules to that effect, but
upon powers spelt out of the policy of modern procedural legislation. Interestingly, the cases in which
the power was first discussed were group proceedings. For those interested, cases in which orders of
this sort have been considered or made include:
Griffiths v Solutia UK Ltd [2001] All ER (D) 196 (Apr); [2001] EWCA Civ 736; AB v Leeds
Teaching Hospitals NHS Trust, In the matter of the Nationwide Organ Group Litigation [2003] 3
Costs LR 405; [2003] EWHC 1034 (QB); Various Ledward Claimants v Kent and Medway Health
Authority [2003] All ER (D) 12 (Nov); [2003] EWHC 2551 (QB); Smart v East Cheshire NHS
Trust [2003] EWHC 2806 (QB); Leigh v Michelin Tyre Plc [2004] 1 WLR 846; [2004] 2 All ER
175; [2003] EWCA Civ 1766; King v Telegraph Group Ltd [2005] 1 WLR 2282; [2004] EWCA
Civ 613; Eirikur Mar Petursson v Hutchinson 3G UK Ltd [2004] EWHC 2609 (TCC); Armstrong
v Times Newspapers Ltd [2004] All ER (D) 283; [2004] EWHC 2928 (QB); Campbell v MGN
Ltd (No 2) [2005] 1 WLR 3394; [2005] 4 All ER 793; [2005] UKHL 61; Sheppard v Mid Essex
Health Authority [2006] 1 Costs LR 8; Henry v BBC [2005] EWHC 2503 (QB); Weir v Secretary of
State for Transport [2005] All ER (D) 274 (Apr); [2005] EWHC 812 (Ch); Tierney v Newsgroup
Newspapers Ltd [2006] EWHC 50 (QB); Knight v Beyond Properties Pty Ltd [2007] 1 WLR 625;
[2007] 1 All ER 91; [2006] EWHC 1242 (Ch).
The existence of the power was first suggested in the Court of Appeal in Griffiths v Solutia supra. It was
applied by single Judges in AB v Leeds Teaching Hospitals supra and Ledward supra and its existence
was confirmed in the Court of Appeal in King v Telegraph Group Ltd supra in the judgment of Brooke LJ
(with whom Jonathan Parker and Maurice Kay LJJ agreed). It received approval in the House of Lords
in Campbell v MGN supra: see at [33], [34] per Lord Hoffmann.
[3.510]
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In AB v Leeds Teaching Hospitals Gage J said at [19]:
In my judgment, in cases where GLOs [group litigation orders] are concerned the desirability
of ensuring that costs are kept within bounds makes it unnecessary for the court to require
exceptional circumstances to be shown before exercising its discretion to make a costs cap
order. … I see no reason for such a requirement where a costs cap order is sought in a GLO,
particularly where there is a risk that costs may become disproportionate and excessive.
At [23] his Lordship said in relation to formulating an appropriate cost capping order:
Firstly, the order for costs must be proportionate with the amount at stake and the
complexity of the issues. Proportionality is to be judged by a two-​fold test namely, initially,
whether the global sum is proportionate to the amount at stake. Next, if the global sum is
disproportionate the court should look at the component parts in order to determine if they
are proportionate (see Lownds v Home Office [2002] EWCA Civ 365).
The general principles as they have emerged were summarised by Mann J in the Chancery Division of
the High Court of Justice in Knight’s case. There his Lordship said at [12]:
However, the costs-​capping jurisdiction has been exercised in other areas [than defamation
actions], notably personal injury litigation. Guidance as to the exercise of the jurisdiction
in that area can be had from one such case, namely the decision of Gage J in Smart v East
Cheshire NHS Trust [2003] EWHC 2806 (QB), (2003) 80 BMLR 175. That was an application
made in the context of an inquiry as to damages in a clinical negligence case. The learned
judge rejected (at [17]) the submission that costs-​capping orders should be made only in the
case of group litigation orders. He said they could be made in other cases. He considered (at
[22]) the question of whether a test of “exceptional circumstances” should apply before the
jurisdiction is invoked. He held it should not. He said:
Having considered all these factors, my conclusion is that whilst each case must be dealt
with on its own facts the test for the court when exercising its discretion on whether to make
a costs cap order in cases such as the instant one is closer to that proposed by Mr Moran QC
than that proposed by Mr Hutton. In my judgment, the court should only consider making a
costs cap order in such cases where the applicant shows by evidence that there is a real and
substantial risk that without such an order costs will be disproportionately or unreasonably
incurred; and that this risk may not be managed by conventional case management and
a detailed assessment of costs after a trial; and it is just to make such an order. It seems
to me that it is unnecessary to ascribe to such a test the general heading of exceptional
circumstances. I would expect that in the run of ordinary actions it will be rare for this test
to be satisfied but it is impossible to predict all the circumstances in which it may be said to
arise. Low value claims will inevitably mean a higher proportion of costs to value than high
value claims. Some high value claims will involve greater factual and legal complexities than
others.
From this extract I can and do extract two propositions: (i) it must be established on
evidence that there is a real risk of disproportionate or unreasonable costs being incurred; and
(ii) it must be shown that that risk cannot be satisfactorily provided for by more conventional
means (and in particular the usual costs assessment after the trial).
2.3 The global costs power: CPA s 98(4)(c)
Section 98 of the CPA is the NSW provision that is common to modern court statutes committing
costs in proceedings to the discretion of the court. In subs (4)(c) it provides that it may be ordered
that the party entitled to costs receive “a specified gross sum instead of assessed costs”. An alternative
submission made to Palmer J in the Sherborne Estate case supra was that his Honour should award
costs to the successful plaintiffs only in global sums considerably less than the costs which they had
incurred, because of the excessive nature of those costs. This his Honour declined to do.
176
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Containment of Costs: Litigation and Arbitration cont.
…
2.4 Local Courts Practice Note
The NSW Local Courts have embarked on a new endeavour this year to contain the costs of small
cases. The endeavour is embodied in Practice Note No 2 of 2007, which affects proceedings where
the amount claimed is $20,000 or less. In those cases, unless the Court otherwise determines, the
Court’s ultimate discretion as to costs will be exercised as if a cost capping order had been made
under UCPR r 42.4 effective from the time of filing of the first defence. Costs up to that time will not
be affected, but the costs to be awarded in respect of work done thereafter shall not exceed, where
the plaintiff succeeds, 25% of the amount recovered and, where the defendant succeeds, 25% of the
amount claimed by the plaintiff. The Practice Note also applies to cases transferred to the General
Division of a Local Court from the Small Claims Division (where claims up to $10,000 are determined)
limiting recoverable costs to a maximum of $2,500.
This is a bold endeavour and it remains to be seen how it will work out. But at least it is a real
endeavour to achieve proportionality in respect of the costs of small monetary claims.
2.5 Bret Walker’s proposal
The Local Court Practice Note is a partial implementation of a larger proposal by Bret Walker SC
contained in his article mentioned above as to a prima facie imposition of costs limits applicable at
various stages of proceedings. He describes it as a “ratchet”. The table he gives as an example at 218
is as follows:
State of litigation when result reached
Fraction of stake (or minimum) payable by loser
Before 1 week after
Date for defence (P wins) 2% or $2,000
Service of defence (D wins)
Before 1 week after
Service of P’s evidence (P wins) 5% or $5,000
Service of D’s evidence (D wins)
1 month before date fixed for hearing
10% or $10,000
Thereafter
15% or $15,000
This table is an illustration of a credible form for a wider or universal prima facie cost capping
regime.
3 The power to cap solicitor/​client costs
In Woolf v Snipe (1933) 48 CLR 677 at 678 Dixon J said:
The superior Courts of law and equity possess a jurisdiction to ascertain, by taxation,
moderation, or fixation, the costs, charges, and disbursements claimed by an attorney or
solicitor from his client, and that jurisdiction is derived from three sources and falls under
three corresponding heads.
First, a jurisdiction exists founded upon the relation to the Court of attorneys and solicitors
considered as its officers. This jurisdiction, commonly called the general jurisdiction of the
Court, enables it to regulate the charges made for work done by attorneys and solicitors of
the Court in that capacity, and to prevent exorbitant demands. That such a jurisdiction was
exercised by the Court of Chancery was never doubted. … The Courts of law appear to have
exercised a like jurisdiction.
In Johnson Tiles Pty Ltd v Esso Australia Ltd (1999) 94 FCR 167 Merkel J in the Federal Court relied
in part on these statements by Dixon J in enjoining the plaintiffs’ solicitors in proceedings in a class
action under Part IVA of the Federal Court of Australia Act 1976 from giving effect to fee agreements
with class members otherwise than in accordance with the order or direction of the Court. This power
does not appear to have had recent use otherwise than in this context.
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4 Global sum orders s 98(4)(c)
I have noted above the potential difficulties of using global sum orders under CPA s 98(4)(c) as a
retrospective cost capping or costs moderation device to which Palmer J referred in the Sherborne
Estate case as noted above. However, that does not mean that a global award of costs considerably
less than those incurred could not be made if there were reasons for the exercise of the discretion
in that way, which related to the parties’ conduct of the litigation or by reference to other relevant
criteria.
However, whether or not the process of global assessment can or should be used to control
excessive expenditure on costs, the making of global sum orders can be used as a device to save the
very considerable costs of the costs assessment process itself. Its use in this way has been given a fillip
by the recent decision of Einstein J in Idoport Pty Ltd v National Australia Bank Ltd [2007] NSWSC 23.
This case was notable not only for the amount in which costs were assessed, which was $50 million,
but also for its clarification of the circumstances and manner in which the power may be used. His
Honour at [10] rejected a submission that the adoption of a broad brush approach to assessment
would mean that the exercise of the discretion under s 98(4)(c) would be arbitrary rather than judicial.
As to the principles on which the discretion is to be exercised, his Honour said at [9]‌:
For present purposes it seems convenient to commence with a recitation of the principles
which inform the exercise of the discretion:
i.
the purpose of the rule is to avoid the expense, delay and aggravation involved in
protracted litigation arising out of taxation: Beach Petroleum NL v Johnson (1995) 57
FCR 119, Von Doussa J page 265: [following Purchase J in Leary v Leary [1987] 1 All ER
261 who described the purpose of the rule allowing the fixing of a gross sum as “the
avoidance of expense, delay and aggravation involved in protracted litigation arising
out of taxation” (All ER page 265)]
ii.
the touchstone requires that the Court be confident that the approach taken to estimate
costs is logical, fair and reasonable: Beach Petroleum at [16];
iii.
the fairness parameter includes the Court having sufficient confidence in arriving at an
appropriate sum on the materials available: Harrison v Schipp (2002) 54 NSWLR 738,
per Giles JA at para [22]; [following (Wentworth v Wentworth (CA, 21 February 1996,
unreported, per Clarke JA) and adopted in Sony Entertainment v Smith (2005) 215 ALR
788; [2005] FCA 228; BC200500963 at para [199];
iv.
a gross sum assessment, by its very nature, does not envisage that a process similar to
that involved in a traditional taxation or assessment of costs should take place: Harrison
v Schipp at para [22];
v.
the gross sum “can only be fixed broadly having regard to the information before the
Court”: Beach Petroleum at 124; [In Hadid v Lenfest Communications Inc [2000] FCA 628 at
[35] it was said that the evidence enabled fixing a gross sum “only if I apply a much broader
brush than would be applied on taxation, but that … is what the rule contemplates”.]
vi.
nevertheless the power to award a gross sum must be exercised judicially, and after
giving the parties an adequate opportunity to make submissions on the matter: Leary v
Leary [1987] 1 WLR 72 at 76, and Beach Petroleum NL v Johnson (No 2) (1995) 57 FCR
119 at 120;
vii.
in terms of the necessity for the approach taken to be logical, fair and reasonable, Von
Doussa J in Beach Petroleum NL v Johnson (1995) 57 FCR 119, put the matter as follows,
at paras [16]:
178
On the one hand the Court must be astute to prevent prejudice to the respondents
by overestimating the costs, and on the other hand must be astute not to cause an
injustice to the successful party by an arbitrary “fail safe” discount on the cost estimates
submitted to the Court: Leary v Leary at 265. …
[3.510]
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Chapter 3
Containment of Costs: Litigation and Arbitration cont.
In relation to the application of a broad brush approach by the application of a discount to the claim
made for costs, his Honour said at [13]:
In adopting a broad-​brush approach to gross sum awards the Courts have invariably applied
a discount to the amounts claimed and in many cases a substantial such discount. The
authorities treating with discount amounts include:
i.
In Canvas Graphics Pty Ltd v Kodak (Australasia) Pty Ltd [1998] 23 FCA; BC9800050,
Canvas Graphics sought a gross sum costs order from Kodak. Canvas Graphics had
prepared three draft bills, which were said to have been prepared on a party/​party
basis, which totalled $610,069, against which the sum of $18,325 had to be set off.
Ultimately O’Loughlin J made gross sum costs orders totalling $233,325. The solicitor
client bills had totalled $1,181,564.50. O’Loughlin J stated:
It would defeat the exercise of assessing a lump sum if one were to make an individual
analysis of the many entries in this draft bill that justify criticism. However, examples can be
given in order to show that there must be a substantial mark down …
[The reduction applied to Canvas Graphics’ solicitor client bills was just over 80%.]
…
I have recently used the power in much more modest circumstances in an FPA case: Lo Surdo v
Public Trustee [2005] NSWSC 1290. It also merits greater use in relation to interlocutory costs, for
example, the costs of motions or costs thrown away by adjournments, where the determination of
amount is comparatively simple.
It is to be hoped that the use of this power will expand. I suggest that judicial officers should
consider bestirring themselves out of traditional attitudes, leaving their safety zone and making
greater use of this power to save money.
5 Interlocutory costs unnecessarily incurred
This is another area where courts have undoubted powers which, however, they are reluctant to use.
It is easier to postpone interlocutory costs and their determination to the end of proceedings rather
than to make the additional effort of determining them now. Postponement is encouraged by rules
such as UCPR r 42.7, which provides that unless the court otherwise orders, interlocutory costs do not
become payable until the conclusion of the proceedings. Even where there is extensive disobedience
of court directions by one side, adding to the other side’s costs of the proceedings, courts do not often
exercise the power to make immediate orders for such costs in global sums and to order immediate
payment of those sums.
The principles on which immediate payment may be ordered were set out by Barrett J in Fiduciary
Ltd v Morningstar Research Pty Ltd (2002) 55 NSWLR 1. This exposition is still relevant, despite the
removal from the rules of a partial specification of the applicable criteria. There is no doubt that
unreasonable conduct by a party is a relevant criterion. Delinquency as relevant to costs issues in other
contexts was discussed in Leidreiter v Rae [2006] NSWSC 1043; Tobin v Ezekiel [2006] NSWSC 694;
Brittain v Commonwealth of Australia [No2] [2006] NSWSC 528.
6 Stopwatch trials
There are now provisions in CPA s 62(3) to limit the length of hearings, the number of witnesses
and the time to be taken in examining witnesses and making oral submissions. This has led to some
experimentation in NSW in relation to stopwatch trials. The provisions of Practice Note SC Eq 3
Commercial List and Technology and Construction List relating to stopwatch hearings are as follows:
Stopwatch hearings
39. An option for matters that are heard by the Court and/​or referred to Referees is the
stopwatch method of trial or reference hearing. In advance of the trial or reference, the Court
will make orders in respect of the estimated length of the trial or reference and the amount
[3.510]
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Civil Procedure in New South Wales
Containment of Costs: Litigation and Arbitration cont.
of time each party is permitted to utilise. The orders will allocate blocks of time to the
aspects of the respective cases for examination in chief, cross-​examination, re-​examination
and submissions. If it is in the interests of justice, the allocation of time will be adjusted by the
Court or the Referee to accommodate developments in the trial or reference.
40. This method of hearing is aimed at achieving a more cost effective resolution of the real
issues between the parties. It will require more intensive planning by counsel and solicitors
prior to trial including conferring with opposing solicitors and counsel to ascertain estimates
of time for cross-​examination of witnesses and submissions to be built in to the estimate for
hearing.
41. Any party wishing to have a stopwatch hearing must notify the other party/​parties in
writing prior to the matter being set down for hearing or reference out. At the time the
matter is set down for hearing or referred out to a Referee it is expected that solicitors or
counsel briefed on hearing will be able to advise the Court:
• whether there is consent to a stopwatch hearing;
• if there is no consent, the reasons why there should not be a stopwatch hearing.
42. If there is consent to a stopwatch hearing counsel and/​or solicitors must be in a position
to advise the Court of:
• the joint estimate of the time for the hearing of the matter; and
• the way in which the time is to be allocated to each party and for what aspect of
the case.
In a further innovative move in the Local Courts, stopwatch provisions have now been incorporated
in Practice Note No 3 of 2007 in those Courts.
7 The power to limit expert evidence
This is another area in which there has recently been reform in NSW by the insertion of a new
Division 2 of Part 31 into the UCPR (rr 31.18–​31.53). Some of these rules replace rules already in
force, but there are a number of important innovations. While these provisions do not deal with
costs directly, the potential is obvious for diminution of costs by limiting the use of expert evidence.
Before I summarise the purport of these rules it should be said that there must be potential under
r 42.4 to cap the amounts to be expended on expert evidence in particular cases. See the address by
The Chief Judge at Common Law of the Supreme Court of NSW, The Hon Peter McClellan, The New
Rules, delivered at a seminar held by the Expert Witness Institute of Australia and the University of
Sydney Faculty of Law on 16 April 2007. See also the same author’s “Expert Witnesses –​The Recent
Experience of the Land and Environment Court” (2005) 17 Judicial Officers’ Bulletin 83.

[3.520] In December 2014, the Productivity Commission released a report based on its inquiry
into Australia’s system of civil dispute resolution. Titled Access to Justice Arrangements, it was
focused on constraining costs and promoting access to justice and equality before the law.
Chapter 13.3 of the report addressed possible reforms for the awarding of court costs with a
view to their containment and more equitable structuring.
Reforming the Structure of Costs Awards
[3.530] Productivity Commission, Access to Justice Arrangements, Inquiry Report No 72, Volume 1
(5 September 2014)
13 Costs awards
…
180
[3.520]
Costs of Litigation
Chapter 3
Reforming the Structure of Costs Awards cont.
13.3 Reforming the structure of costs awards
Ideally, costs awards would be structured in a way that:
• improves certainty for risk averse litigants
• does not encourage parties to spend more than is necessary on legal costs
• maintains some degree of indemnity for winning parties.
Activity-​based scales of costs, as currently used in many Australian jurisdictions, fail to deliver this
outcome and result in an increased level of litigation spending and a loss of certainty for all litigants.
The flaws in activity-​based scales have long been recognised:
[U]‌nless activity based scales are replaced with a cost shifting method with better incentives,
improvements to court systems will founder. (Cannon 2002, p. 208)
The Commission considers that a range of reforms to costs awards are required.
Fixed, event-​based scales for lower-​tier courts
One approach to remedy the flaws in current arrangements is to use scales of costs that prescribe
fixed amounts for each stage reached in the process. Under fixed scales, parties can determine with a
high degree of certainty the amount of any potential adverse costs award. This will mean that parties
no longer have to face the possibility of a costs order that exceeds what they might have expected
to pay. The Australian Law Reform Commission (1995) previously concluded that costs award rules
should enable parties to accurately estimate their potential exposure to costs at the beginning of
proceedings.
The Federal Circuit Court, which currently uses an event-​based scale, argued that such scales
provide greater transparency:
[A]‌n event based scale was more appropriate for a court such as the FCC and was seen to
provide a greater degree of transparency for litigants. (sub. DR258, p. 8)
Fixed scales also reduce the incentive for parties to over-​service, as the costs a party can recover are
unrelated to activity. In response, the NSW Bar Association has argued:
[T]‌he Association rejects notions of overservicing in the context of a party-​party costs
regime where by definition costs are assessed at the level of what is reasonable. Costs
assessment processes are in place to ensure oversight of costs awarded. If one or both
parties engaged in overservicing (or “gold plating” to adopt the current economic jargon)
then any such excess preparation would not be recoverable as “reasonable” party-​party
costs. (sub. DR206, p. 5)
However, in the Commission’s view, costs assessment processes are not an appropriate mechanism
to discourage excessive litigation costs in lower-​tier courts for a number of reasons. First, in lower-​
level disputes, parties are less likely to be willing to expend the costs, time and effort involved
in obtaining a costs assessment. Second, as identified in submissions to a review of the NSW
Costs Assessment Scheme, assessment processes often lack transparency and consistency, and
determinations can vary widely between assessors, even on identical issues (Law Society of NSW
2011; NSW OLSC 2011).
One concern is that a fixed, event-​based costs amount may not provide sufficient indemnity to
some successful litigants whose necessary legal expenses exceed the fixed amount. This may occur
when there is a wide range of necessary legal costs required by different cases of the same length and
amount in dispute:
A fixed scale should not be used because it fails to take into account the individual complexity
of cases. Scale rates can also present problems where the nature of the proceedings and the
legal representation of the parties varies widely. (Law Council of Australia, sub. DR266, p. 67)
[3.530]
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Civil Procedure in New South Wales
Reforming the Structure of Costs Awards cont.
Indeed, any system of scales that chooses a single, representative costs amount for cases of a given
length and amount will not fully indemnify a proportion of the cases in that bracket, and will over-​
indemnify in others.
However, activity-​based scales currently used in most courts already fail to provide successful
litigants with full indemnity for costs. Further, as discussed in ­chapter 3, the spread of legal costs
incurred across cases in lower-​tier jurisdictions is relatively small compared to superior jurisdictions.
Thus there are likely to be fewer outlying cases that are not sufficiently indemnified. The Federal
Circuit Court has noted that few criticisms of event-​based scales have been borne out in reality (sub.
DR258).
In some cases, a fixed scale of costs will provide greater indemnity than activity-​based scales.
For example, a fixed scale can afford full indemnity to a party that undertakes less activity than
is expected. This essentially rewards parties that are efficient and do not over-​spend on litigation.
However, this should not lead to incentives to “under-​service”, as parties must still undertake sufficient
activity to win the case in order to be awarded costs.
Fixed scales also reduce the need for courts to settle disputes regarding the amount of costs to be
paid between parties when costs are awarded. This may lead to significant savings for parties and the
courts. As noted by the Federal Circuit Court of Australia:
[W]‌ith the event based scale there is no role for taxation or assessment. (sub. DR258, p. 8)
Fixed scales also address issues concerning how costs amounts should be calculated for self-​represented
litigants and consumers purchasing “unbundled” legal services (section 13.4). At present, activity-​
based scales only compensate a party using unbundled legal advice for the work undertaken by their
lawyer. This essentially discourages unbundling if a party believes they are likely to recover most of the
costs of work being carried out by their lawyer, but not if they do the work themselves.
In contrast, a fixed, event-​based scale is based on outcomes, rather than inputs. This means that a
party is equally compensated regardless of whether work is performed entirely by a lawyer or shared
between lawyer and client on an unbundled basis.
Fixed scales should be proportionate to the amount in dispute
The fixed, event-​based amounts awarded in costs by lower-​tier courts should also be set in proportion
to the amount that is in dispute. The amount in dispute can be defined as the amount awarded
in the judgment sum for successful plaintiffs, and the amount claimed by the plaintiff for successful
defendants. By tying the amount of costs awarded to the size of the claim or judgment sum, courts
can encourage legal costs to remain in reasonable proportion to the dispute. This principle can also
discourage overly ambitious claims, as increasing the amount claimed also increases the plaintiff’s
costs liability. Variants of this approach are employed in Germany, England and Wales.
The South Australian Magistrates Court uses an event-​based scale, where the costs awarded for
each stage in the process are a percentage of the amount claimed. The percentage is altered for each
stage in the process, as well as for some dispute types, and is not tied directly to the work undertaken
by either side (table 13.3).
TABLE 13.3 An example of a percentage scale of costs
For selected events in the South Australian Magistrates Court, for a claim worth $100 000, as at
26 April 2013
Event
1. Pre-​action notice
2. Filing an action or defence,
including directions hearing
182
[3.530]
Action type
Rate
$100 000 claim
other than for personal injury
1%
$1 000
personal injury
2%
$2 000
liquidated sum
3%
$3 000
other than for a liquidated sum
5%
$5 000
Costs of Litigation
Chapter 3
Reforming the Structure of Costs Awards cont.
3. Activity after the first directions
hearing until the trial date is set
liquidated sum
other than for a liquidated sum
4. Activity from trial date set until trial
5. Preparing and filing a trial plan
6. Fees for counsel at trial
10%
$10 000
12%
$12 000
10%
$10 000
2.5%
$2 500
first day
3%
$3 000
subsequent days
2.5%
$2 500
2%
$2 000
7. Court ordered mediation
Source: Magistrates Court (Civil) Rules 2013 (SA).
In England and Wales, fixed costs regimes have recently been adopted to determine the amount
of costs to be awarded in particular dispute types, such as fast track trials and cases within the Road
Traffic Accident Protocol. Parties are awarded costs based on a fixed lump sum plus an amount equal
to a percentage of the awarded damages. Both the lump sum amount and the percentage of damages
awarded increase as a case proceeds through each stage of litigation (Taylor 2013). An evaluation one
year after introduction of the Road Traffic Accident Protocol found that average costs in low value
traffic claims had reduced by between 3 and 4 per cent, along with small reductions in general
damages and delays before settlement (Fenn 2012).
Putting it into practice –​the amounts to be contained in fixed scales
Calculating costs as a direct percentage of the value of the claim may not be the most effective means
of estimating reasonable and necessary legal costs. As the Commission has shown in c­ hapter 3, the
costs of litigation currently do not increase in direct proportion with amounts in dispute. Rather, costs
appear to comprise a larger proportion of lower value claims, as there will be some necessary costs of
litigation that do not vary with the dispute amount. As such, a scale based on direct percentages of
claim values may not sufficiently indemnify lower value claims.
Another option, and the Commission’s preferred response, is for the costs awarded to reflect the
costs typically paid in a case of similar value reaching each given stage of a trial. Where the monetary
value of a dispute cannot be specified, or an economic value not reasonably imputed, the scale should
set amounts based on the type and length of the case.
The Commission has constructed a practical example of a fixed scale in table 13.4. This illustrative
scale is based on data from previous surveys of litigation costs for cases of varying length and dispute
type in the County Court of Victoria in 1993. In practice, any scale would draw on a wider range of
more recent costs data.
TABLE 13.4 Illustrative example of a fixed, event-​based proportional scale of costsa
1993 dollars, by stage & amount in dispute, for the County Court of Victoria
Stage of process
Less than
$20 000
$20 000 to
$39 999
$40 000 to
$99 999
$100 000 or
more
Non-​monetary
dispute
Event 1: Pre-​trial
conferencing to trial
$1 065
$1 420
$1 775
$3 550
$1 950
Event 2: Trial
$1 278
$1 704
$2 130
$4 260
$2 350
Event 3: Verdict
$1 917
$2 556
$3 195
$6 390
$3 500
Total
$4 260
$5 680
$7 100
$14 200
$7 800
a This scale has been put together entirely for illustrative purposes. The figures above do not reflect estimates
of the costs of litigation at present.
Sources: Commission estimates using figures from studies of costs in the County Court of Victoria from
Worthington and Baker (1993) and Williams and Williams (1994).
[3.530]
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Civil Procedure in New South Wales
Reforming the Structure of Costs Awards cont.
Some stakeholders have argued that the complexity and data requirements involved in constructing
such a scale make its implementation unfeasible (Law Society of South Australia, sub. DR219; Law
Society of Tasmania, sub. DR227).
Others also noted that there are concerns as to whether fixed scale rates will adequately reflect
market costs:
Experience shows that scale rates are inevitably set too low and the process for review and
increase of those rates is too slow. (Law Council of Australia, sub. DR266, p. 67)
The profession generally considers such regimes too arbitrary, and not being able to
keep pace with market charges, and are not reflective of the costs actually incurred. (Federal
Circuit Court, sub. DR258, p. 8)
However, this merely underscores the importance of more rigorous and consistent data collection in
the courts system (­chapter 24). These concerns can be addressed by requiring scales to be periodically
reviewed to ensure they continue to reflect the costs incurred by parties. For example, the Law Society
of Tasmania suggested a two year period may be appropriate (sub. DR227).
In the Commission’s view, the benefits of moving to a fixed, event-​based scale in lower-​tier courts
would outweigh the short term costs of its construction. As noted previously, legal costs appear to
be more stable and certain –​and thus easier to set out in a fixed scale –​in lower-​tier courts. While
the Federal Circuit Court noted that there were some difficulties in setting events and amounts for its
costs scale, the court nonetheless believes that its use of an event-​based scale has been appropriate
(sub. DR258).
Further, while the construction of such a scale might be complicated, its application need not be.
Indeed, to the user, the concept is relatively straightforward. Litigants need only know two things –​
the amount in dispute and the stage of proceedings they have reached –​in order to identify their
potential liability for costs.
RECOMMENDATION 13.2
In Magistrates’ courts and the Federal Circuit Court, costs awarded to parties on a standard
basis should be set according to fixed amounts contained within court scales. Scale amounts
should vary according to the:
• type of dispute
• stage reached in the trial process
• amount that is in dispute (where relevant).
For plaintiffs awarded costs, the relevant amount in dispute should be the judgment sum
awarded. For defendants awarded costs, the amount in dispute should be the amount
claimed by the plaintiff.
The fixed scale amounts should reflect the typical market cost of resolving a dispute of a
given type, value and length. Data collection and analysis should be undertaken to facilitate
a public review of the amounts and costs categories every three years. The amounts should
be indexed to the relevant capital city Consumer Price Index increase in other years.
The public reviews should be undertaken concurrently with those contained in
recommendations 16.1 and 17.3 to minimise consultation burdens on interested parties.
Costs in superior courts require greater flexibility and discretion
While fixed, event-​based costs may be appropriate for some superior court cases, in superior courts
there can also be a “long tail” of complex cases for which the required legal costs may be relatively
high and variable (­chapter 3). As noted by the Law Society of South Australia:
184
[3.530]
Costs of Litigation
Chapter 3
Reforming the Structure of Costs Awards cont.
Matters in [superior courts] are vastly variable and complex and the discretion of the court in
awarding costs in that context is crucial. (sub. DR219, Attachment, p. 66)
It may therefore be appropriate to maintain activity-​
based cost scales in superior courts, while
introducing reforms for courts to manage and limit costs awards to improve the incentives of
disputants.
One approach is for courts to set a maximum amount of recoverable costs at the outset of litigation
(often referred to as costs budgeting). This can confer many of the benefits of fixed scales, by giving
litigants greater certainty at the outset of litigation, while offering sufficient discretion and flexibility
in the amount set to provide reasonable indemnity for atypical cases. As argued by the Public Interest
Advocacy Centre (PIAC):
[This] has the potential to remove uncertainty about the level of risk of an adverse costs
order, thereby allowing the applicant to proceed in cases where they otherwise might be
unfairly inhibited from doing so. (sub. 45, p. 31)
While acknowledging that placing a cap on recoverable costs at the outset of litigation may be
beneficial in some circumstances, the NSW Bar Association has argued that its use should be court
led, and should form part of the discretionary powers available to judges for case management (sub.
DR206; trans., p. 120).
Indeed, this appears to already be the case in some jurisdictions. For example, parties in the Federal
Court of Australia currently have the ability to seek an order from the Court specifying a maximum
cap on the costs that can be awarded in a case, under rule 40.51 of the Federal Court Rules 2011
(Cth).31 Similar discretionary powers to cap recoverable costs also exist in some other courts, such as
rule 21.03 of the Federal Circuit Court Rules 2001 (Cth), and rule 42.4 of the Uniform Civil Procedure
Rules 2005 (NSW).
However, there is some evidence to suggest that, where they exist, discretionary powers to cap
costs are currently underutilised. For example, Watters (2010) noted that, since the introduction
of order 62A in the Federal Court in 1992, less than ten reported decisions on its application have
been made. It has been suggested to the Commission that the existing rules for capping costs are
underutilised for a number of reasons:
One problem with the Order (and other similar costs-​limiting orders in other jurisdictions) is
its infrequent use, due to a lack of awareness by practitioners and judges, and in cases where
applications have been made, the reticence of judges to make orders limiting costs. (PIAC,
sub. 45, p. 31)
This raises the question as to whether capping recoverable costs should generally be a standard
process at the outset of litigation, rather than an order at the court’s discretion that must be sought
by a party in each matter.
Widespread use of costs budgeting was recently introduced in the County and High Courts in
England and Wales. This system of costs management generally requires parties to file costs budgets
with the court early in the proceedings (UK Ministry of Justice 2013a). Each party’s costs budget
provides a breakdown of each stage of the litigation, identifying costs already incurred and those
estimated to be incurred thereafter (Kennedys 2013). While parties are encouraged to reach agreement
on their budgets, in the absence of agreement the court may make a costs management order to
determine the maximum costs recoverable by the parties. These maximum amounts can be updated
during litigation on agreement, or if updates are warranted by significant developments in the case.
In the draft report, the Commission recommended that superior courts in Australia introduce costs
budgeting regimes similar to those of English and Welsh courts. In response, some stakeholders have
31
Formerly order 62A of the Federal Court Rules (Cth).
[3.530]
185
Civil Procedure in New South Wales
Reforming the Structure of Costs Awards cont.
argued that requiring parties to undertake additional preparation and pre-​trial processes in submitting
and negotiating on such budgets may lead to additional costs being incurred by parties (NSW Bar
Association, sub. DR206; Law Society of Tasmania, sub. DR227).
Other stakeholders suggested that at the outset of litigation practitioners are unable to accurately
predict many factors that may affect costs budgets (Law Council of Australia, sub. DR266; Australian
Lawyers Alliance, sub. DR298). The NSW Bar Association also noted that this may be particularly
challenging if the Commission’s recommendation to abolish formal pleadings was adopted (sub.
DR206; trans., pp. 118–​119). However, such concerns may be addressed by allowing budgeted
amounts to be varied where the court deems unforeseeable circumstances to have arisen, as is
currently the case in England and Wales (Flemington and Kensington Community Legal Centre, sub.
DR225).
The Commission recognises that while costs budgeting appears to have merit in principle, the
relative costs and benefits of its recent implementation as a standard process in some English and
Welsh courts are still largely unknown at this stage. This echoes the views of a number of stakeholders,
who suggested that it is too early to conclude whether such processes are of benefit to parties and the
courts (Law Society of South Australia, sub. DR219; Eqalex Underwriting, sub. DR278).
In the short term, the Commission recommends that superior courts, and those intermediate courts
with unlimited civil jurisdiction, should adopt costs budgeting as a discretionary power for use in case
management. However, given the potential for these discretionary powers to be underutilised, there
remains merit in further exploring the costs and benefits of more systematic use of costs budgeting.
Eqalex Underwriting proposed that:
Australia could learn a great deal by adopting a “wait and see” position on how costs
budgets evolve in the UK, particularly when they are the most contentious subject which the
UK courts, law firms, bar and litigants are grappling with at the moment. (sub. DR278, p. 9)
There appears to be merit in waiting for the English and Welsh reforms to be fully implemented for a
sufficient period before evaluating whether such a regime is warranted in Australia. The Commission
considers that the Australian Law Reform Commission (ALRC), and its state and territory counterparts,
would be best placed to evaluate the merits of adopting such a regime. Consideration should also
be given as to whether such a regime would also be appropriate where intermediate courts have
unlimited civil jurisdiction, for example the District Court of South Australia.
Any future implementation of widespread costs budgeting may require additional court resources –​
such reforms should be funded accordingly, as noted by the NSW Bar Association (sub. DR206).
RECOMMENDATION 13.3
Judicial officers in all superior courts in Australia should, at their discretion, have the power
to require parties to submit costs budgets at the outset of litigation. Where parties do not
agree upon a budget, the court may make an order to cap the amount of awarded costs
that can be recovered by the successful party. Courts should publish guidelines informing
parties and the judiciary as to how costs budgeting processes should be carried out.
By 30 June 2016, the Australian Law Reform Commission (in consultation with its State and
Territory counterparts) should examine the performance of the costs budgeting regime of
the English and Welsh courts, and recommend in which Australian courts the application of
such a regime would be appropriate.

186
[3.530]
CHAPTER 4
Alternatives to Litigation –​Negotiation and
Mediation
[4.10]
[4.20]
[4.30]
[4.160]
[4.190]
[4.220]
INTRODUCTION.........................................................................................................
ALTERNATIVE DISPUTE RESOLUTION...........................................................................
GROWTH OF ADR.......................................................................................................
[4.40]
Review of the Adversarial System in Litigation.........................................
[4.50]
The New Lawyer: How Settlement Is Transforming the Practice of Law..........
[4.70]
Civil Justice Review............................................................................
[4.80]
Uncertainty in Litigation.....................................................................
[4.90]
The New Lawyer: How Settlement Is Transforming the Practice of Law..........
[4.100]
Why We Still Litigate.........................................................................
[4.110]
Against Settlement............................................................................
[4.130]
Whose Dispute Is It Anyway?...............................................................
[4.135]
Courts as the Third Branch of Government.............................................
[4.140]
Three Things to Be Against (Settlement Not Included)...............................
[4.155]
Perspectives on ADR and Future Trends..................................................
TYPES OF ADR PROCESSES..........................................................................................
[4.170]
Dispute Resolution Processes...............................................................
[4.180]
Dispute Resolution Terms....................................................................
NEGOTIATION............................................................................................................
[4.200] Comparison of positional and interest-​based negotiation............................
[4.210] What role does the law play in interest-​based negotiation?.........................
MEDIATION................................................................................................................
[4.230] Why choose mediation?..............................................................................
[4.240] Role of the lawyer.......................................................................................
[4.244]
Representing Clients from Courtroom to Mediation Settings.......................
[4.248] Position statements.....................................................................................
[4.250] Compulsory mediation................................................................................
[4.260]
Civil Justice Review............................................................................
[4.280]
Civil Procedure Act 2005 (NSW) ss 25–​34..............................................
[4.290]
Higgins v Higgins..............................................................................
[4.300]
Waterhouse v Perkins.........................................................................
[4.304] Good faith..................................................................................................
[4.304]
The Right Balance between Trial and Mediation: Visions, Experiences
and Proposals.................................................................................. 223
[4.306]
[4.340]
187
188
189
190
190
192
193
194
195
195
196
198
198
199
200
200
201
203
205
206
206
208
209
210
214
215
215
217
219
221
223
The ripeness of a dispute for mediation.......................................................
[4.310]
Oasis Fund Management v ABN Amro...................................................
[4.320]
Tony Hassan Noun v Margaret Pavey....................................................
[4.330]
The Objectives, Scope and Focus of Mediation Legislation in Australia..........
ENFORCEABILITY OF AGREEMENTS TO USE ADR.........................................................
[4.350]
United Group Rail Services v Rail Corporation NSW..................................
225
225
228
229
231
231
INTRODUCTION
[4.10] This chapter provides an introduction to the alternatives to litigation. It provides an
overview of alternative dispute resolution (ADR) processes and then looks in more detail
at negotiation and mediation. Particular attention is paid to court-​ordered ADR and the
[4.10]
187
Civil Procedure in New South Wales
enforceability of agreements to use ADR. Chapter 5 then examines domestic arbitration,
referral to a referee and expert determination.
This chapter also seeks to highlight the differences between litigation and ADR so as to
explain the advantages and disadvantages of each with a view to identifying the factors that
need to be weighed in determining which is more suitable for a particular dispute. As one
American text on ADR explained:1
From a professional point of view, a working knowledge and understanding of all dispute
processing mechanisms is simply good lawyering. Every client with a dispute deserves a two-​
step analysis –​a determination of the substantive law that applies to the facts and an evaluation
of the dispute processing mechanisms that will achieve a just and fair resolution for the client.
Lawyers are often dispute resolution gatekeepers leading Chief Justice Bathurst to observe
that “it is essential that lawyers understand the nature and role of alternative, or additional,
dispute resolution when advising a client as to the appropriate legal recourse”.2 For many
clients their day in court in which a judge announces that they are right is their idealised view
of dispute resolution. Mediation or arbitration may be unheard of or not well understood.
Accordingly, it falls to the lawyer to educate the client as to the options for dispute resolution.
This responsibility is recognised by the Legal Profession Uniform Law Australian Solicitors’
Conduct Rules 2015 (NSW) r 7.2 which provides:
A practitioner must inform the client or the instructing practitioner about the alternatives to
fully contested adjudication of the case which are reasonably available to the client, unless the
practitioner believes on reasonable grounds that the client already has such an understanding
of those alternatives as to permit the client to make decisions about the client’s best interests in
relation to the litigation.
The Legal Profession Uniform Conduct (Barristers) Rules 2015 (NSW) r 36 is in almost
identical terms. Similar obligations exist by force of the overriding purpose discussed in
Chapter 2.
This chapter does not discuss the theories of ADR in depth nor seek to teach the skills
necessary to conduct it effectively. For further reading, see Hilary Astor and Christine Chinkin,
Dispute Resolution in Australia (2nd ed, Butterworths, Sydney, 2002); David Spencer, Lise Barry
and Lola Akin Ojelabi, Dispute Resolution in Australia; Cases, Commentary and Materials
(4th ed, Thomson, Sydney, 2019) and Samantha Hardy and Olivia Rundle, Mediation for
Lawyers (CCH, Sydney, 2010).
ALTERNATIVE DISPUTE RESOLUTION
[4.20] For many cultures, litigation is not the dominant method of resolving disputes. For
example, traditional Aboriginal groups engaged in consensual resolution of conflict over
40,000 years ago; for further reading, see Larissa Behrendt, Aboriginal Dispute Resolution
(Federation Press, Sydney, 1995) at 7.
1
2
188
Yarn DH and Jones GT, Alternative Dispute Resolution: Practice and Procedure in Georgia (3rd ed, Thomson
West, 2006) at [1:7].
The Hon TJ Bathurst, Chief Justice of New South Wales, Opening Address, 2011 Advanced Alternative Dispute
Resolution Workshop, Sydney, 13 August 2011, p 11.
[4.20]
Alternatives to Litigation – Negotiation and Mediation
Chapter 4
ADR is defined by the National Alternative Dispute Resolution Advisory Council
(NADRAC)3 as:
an umbrella term for processes, other than judicial determination, in which an impartial person
assists those in a dispute to resolve the issues between them.
ADR was originally used as an abbreviation for “alternative dispute resolution”. However, the
word “alternative” is misleading as it suggests that ADR, as opposed to litigation, is the less
common form of dispute resolution. This is not the case as most disputes are resolved without
a judicial decision. ADR is increasingly referred to as “appropriate dispute resolution” in
“recognition of the fact that such approaches are often not just an alternative to litigation, but
may be the most appropriate way to resolve a dispute”: see Victorian Law Reform Commission,
Civil Justice Review, Report (2008) at 212. ADR can be utilised by the parties and it can be the
subject of a referral by the court. ADR is also part of case management (see Chapter 2).
The Jackson ADR Handbook that was produced as a result of Lord Jackson calling for
a single authoritative handbook that explained clearly and concisely what ADR is, as part
of his review into the cost of litigation in England and Wales, employs the phrase ADR “to
cover the full range of alternatives to litigation potentially available to resolve a civil dispute.
It therefore includes any option where: there is a dispute between two (or more) parties;
that dispute relates to civil legal rights and/​or duties; and the dispute could potentially be
addressed through litigation”.4
GROWTH OF ADR
[4.30] There has been substantial growth of ADR in the past 30 years. The Victorian Law
Reform Commission reports that “settlement rates for ADR are often very high, usually
between 50% and 85%”.5 The 2014 and 2017 Annual Reviews for the Supreme Court of
NSW reported the following referrals to mediation for the period 2010 to 2017:
Year
2010
2011
2012
2013
2014
2015
2016
2017
Cases Referred to Mediation
1,144
902
1,092
1,088
839
1,071
806
943
Mediation Referral Index
23.5%
19.4%
23.9%
23.7%
19.0%
23.1%
17.3%
20.8%
The mediation referral index records the number of cases referred to mediation compared
to the number of cases lodged with the court that are suitable for mediation. The 2014 year
was reduced due to the piloting of informal settlement conferences in family provision cases
where the estate was valued at less than $500,000. Without the pilot, it was estimated that
referrals to mediation would have been 996 or 22.5%.6 This reduction was also applicable to
all later years.7 The above figures can be compared with 2005 when the mediation referral rate
3
4
5
6
7
NADRAC was an independent non-​statutory body established in October 1995 that provided expert policy
advice to the Attorney-​General on the development of ADR and promoted the use of ADR. The Australian
government disestablished NADRAC in late 2013. NADRAC’s publications are available from http://​www.
ag.gov.au/​LegalSystem/​AlternateDisputeResolution/​Pages/​NADRACpublications.aspx.
Blake S, Browne J and Sime S, The Jackson ADR Handbook (2nd ed, Oxford University Press, 2016) at [1.02].
Victorian Law Reform Commission, Civil Justice Review, Report No 14 (2008) p 213, quoting NADRAC, ADR
Research: A Resource Paper (2004) at 32 [120].
Supreme Court of NSW, Annual Review 2014, pp 34 and 54.
Supreme Court of NSW, Annual Review 2017, p 54.
[4.30]
189
Civil Procedure in New South Wales
was 9% of the filing rate for applicable cases.8 The 2014 Annual Review also reported that in
relation to court-​annexed mediation (where the mediator is a court registrar) the settlement
rate for 2010–​2014 was 50%–​55%. The 2017 Annual Review reported that in relation to
court-​annexed mediation (where the mediator is a court registrar) the settlement rate for
2015–​2017 ranged from 51%–​46%.
However, ADR occurs in a setting where lawyers have traditionally held a “litigation
mindset”. The Australian Law Reform Commission has observed that there is a litigation
mindset of lawyers who operate in an adversarial system of litigation.
Review of the Adversarial System in Litigation
[4.40] Australian Law Reform Commission, Review of the Adversarial System in Litigation; Rethinking
the Federal Civil Litigation System, Issues Paper No 20 (1997) at [11.10–​11.11]
The adversarial “mind-​set” extends beyond the conduct of litigation to inform most areas of legal
practice. Most lawyers are not litigators. There is nevertheless a pervading consciousness in legal
practice that litigation is the possible conclusion of any contract, trust or deed of conveyance drawn
up or any legal advice tendered. The attitude of the lawyer is one of precaution and anticipation of
litigation.
While the aim is to avoid litigation not to invite it, such a perspective necessarily brings with it a
time-​consuming, complex and costly regime directed at covering every circumstance and eventuality.
This is the service that lawyers most often provide and it is one that is expected of them by clients
who seek legal assistance.

The New Lawyer: How Settlement Is Transforming the
Practice of Law
[4.50] Julie Macfarlane, The New Lawyer: How Settlement Is Transforming the Practice of Law (2008)
UBC Press
The Default to Rights
Rights strategies are characteristically presented as the default or sometimes the only appropriate
approach for a lawyer to take to conflict resolution. The practical consequence of this belief is that the
basis of the lawyer’s role is rights-​based advocacy. Although such a belief is critical to the function of
a legal professional, adherence to this model often means that other forms and styles of advocacy and
the promotion of client goals and interests are overlooked or rejected.
Western justice systems emphasize an individualist approach, in which the rights of the individual
will be recognized and upheld, or the converse, in which the individual will be protected against the
oppressive assertion of the rights of others (including the state). This commitment to individual rights
means that the primary responsibility of the lawyer is the furtherance of her clients’ goals framed as
legal ends.
The rights-​based model assumes that the source of conflict is in all circumstances an uncompromisable
moral principle or an indivisible good. Once the conflict becomes “objectified” in this way (sustained
by an appeal to allegedly objective moral standards and beyond merely partisan preferences), it
becomes inevitable that the aggrieved party will press her moral claim.
8
Supreme Court of NSW, Annual Review 2009, p 28.
190
[4.40]
Alternatives to Litigation – Negotiation and Mediation
Chapter 4
The New Lawyer: How Settlement Is Transforming the Practice of Law cont.
Focusing only on a rights-​based analysis assumes the essential moral basis of any conflict, since
rights arguments are couched in terms of right and wrong rather than in terms of what is expedient,
feasible, or wise.
Over-​
reliance on and dedication to a rights-​
based approach carries the risk of blindness to
alternative strategies or the dismissal of these as being less than “real” lawyering strategies. In the
characteristic single-​mindedness of adversarial rights talk, there is no midway point in the making of
arguments. Rights claims are never asserted as “maybe” or “perhaps” but are always put forward with
unwavering certainty, even when counsel knows better. This (public) commitment to one’s asserted
position is a core, unshakable belief for many lawyers. More troubling still, it generally overwhelms
a consideration of other sometimes more appropriate ideologies of practice (such as business or
commercial considerations).
In reality, many disputes are brought to lawyers that simply do not require, and are not suitable
for, a rights-​based argument or solution, and they may escalate unnecessarily if viewed exclusively
through this prism.
Despite the limitations on problem solving in a rights-​based model, the danger of exploitation
of superior resources, and the risks of over-​commitment, a rights-​based approach to legal disputing
remains essential to the rule of law. It is an appropriate approach for dispute resolution over “public
goods” and a critical means of reinforcing and extending principled protections and entitlements.
Lawyers work within a system of rule-​based adjudication, and they are charged with the stewardship
of rights by their education and training. Lawyers must understand, respect, and promote rights
entitlements. In some cases that implicate rights, negotiation or compromise may be a sign of failure
or an unjustified or coerced accommodation.
Instead of assuming that disputes will be resolved by an argument over rights before a third-​
party decision maker or judge, lawyers should recognize that they will usually be resolved through
negotiation, which will take place in the shadow of the law and rights entitlements but not be
determined by it.
Sustaining and reinforcing the dominance of rights-​based approaches to conflict is a second value
set regarding the authority and respect that attaches to the formal legal process. There are detailed
procedural rules and regulations (civil, criminal procedure), which require each and every disputant to
follow the same steps in pursuing or defending a claim. This notion of procedural equality is sacred to
the adjudicative system, which assumes that a significant component of fair process is the sameness
of procedures for each disputant, including filing requirements, timelines, and appearances.
Play to Win (Legal Negotiations Are a Zero-​Sum Game)
Legal negotiations are about winning and playing to win. Playing to win means regarding negotiation
as a zero-​sum game.
A zero-​sum game is a conception of bargaining in which one side’s loss is the other side’s gain.
This approach to negotiation means that all or both parties are assumed to want the same thing and
that the only way to settle is to divide up this so-​called “fixed pie” (money, market share, intellectual
property rights, child custody, and so on) in some acceptable way.
Lawyers understand legal negotiations as zero-​sum because they approach negotiation as an
adjunct of litigation, usually preparing in the same way for each. This means that their conception
of the outcome of negotiation is the same as their conception of the outcome of adjudication: that
there will be a single winner who takes all and that the rest will be losers. The norms surrounding a
zero-​sum approach to bargaining fit perfectly with the belief in a default to a rights-​based approach,
driven by legal expertise.
In many legal disputes, the parties want different things, in different ways, and for different reasons,
and there is plenty of potential for intelligent and strategic bargaining that recognizes the differing
priorities and goals of the parties. In reality, the substance of and issues at stake in legal disputes are
rarely zero-​sum, just as few disputes, or few elements of some disputes, are truly about indivisible values.
[4.50]
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Civil Procedure in New South Wales
The New Lawyer: How Settlement Is Transforming the Practice of Law cont.
Instead of arguing “for” or “against” certain outcomes, lawyers provide better service to their
clients when they examine the various possible benefits that they could negotiate on their behalf.
Information Is for Winning
The zero-​
sum assumptions of legal negotiations have many implications for the way in which
information is understood and valued in legal negotiations. The acquisition and development of
information is regarded as being primarily about winning rather than about understanding and
elaborating the clients’ needs, developing shared facts, or understanding more about the other
side and possible mutual gains. When information is only about winning, a culture of secrecy and
non-​disclosure develops in legal negotiations that borders on the paranoid. Disclosure of almost any
information is assumed to give an advantage to the other side.

[4.60] This litigation mindset means that there is a tendency for lawyers when confronted
with a problem to consider it in terms of the applicable law, the likely court outcome and the
cost of litigation. This mindset may also be fostered by the teaching of substantive law in law
schools which focuses on litigated cases (usually appeals) to teach legal principles.
The growth of ADR has been attributed to the difficulties that litigants have with accessing
justice in the adversarial system of litigation. The adversarial system’s disadvantages, such as
delay and cost, support the use of ADR. The detrimental effect of the adversarial process on the
relationships between the parties, especially where the litigants have an ongoing commercial
relationship, is also responsible for parties adopting ADR.
However, the courts’ unique position means they should not be disregarded as a forum for
resolving disputes. The courts wield the power of the State, they interpret the laws, ensure
procedural fairness and render binding decisions in public that authoritatively state the law
for the parties and society at large.
Civil Justice Review
[4.70] Victorian Law Reform Commission, Civil Justice Review, Report No 14 (2008) p 214
The benefits and disadvantages of ADR were considered by the Victorian Law Reform Commission
in its 2008 inquiry on civil justice.
1.4 Benefits and disadvantages of ADR
Benefits
Some of the benefits of ADR include:
ADR can allow access to justice. For example, as there can be cost and time savings in ADR, it can
be more accessible to those of limited financial means.
ADR can be faster. A dispute can often be resolved in a matter of months, even weeks, through
ADR, while a legal proceeding can take years.
ADR can save time and money. Court costs, lawyers’ fees and experts’ fees can be saved. There
can also be savings for the courts and government.
ADR can permit more participation. The parties may have more chances to tell their side of the
story than in court and may have more control over the outcome.
ADR can be flexible and creative. The parties can choose the ADR process that is best for them.
For example, in mediation the parties may decide how to resolve their dispute. This may include
remedies not available in litigation (eg a change in the policy or practice of a business).
192
[4.60]
Alternatives to Litigation – Negotiation and Mediation
Chapter 4
Civil Justice Review cont.
ADR can be cooperative. The parties may work together with the dispute resolution practitioner
to resolve the dispute and agree to a settlement that makes sense to them, rather than work against
each other in an adversarial manner. This can help preserve relationships.
ADR can reduce stress. There are fewer court appearances. In addition, because ADR can be
speedier and save money, and because the parties are normally cooperative, ADR is less stressful.
ADR can remain confidential. Unlike the court system where everything is on the public record,
ADR can remain confidential. This can be particularly useful, for example, for disputes over intellectual
property which may demand confidentiality.
ADR can produce good results. Settlement rates for ADR processes are often very high, generally
between 50% and 85%.
ADR can be more satisfying. For the above reasons, many people have reported a high degree of
satisfaction with ADR.
Disadvantages
Some of the disadvantages of ADR include:
Suitability. ADR may not be suitable for every dispute, for example, if a party wishes to have a legal
precedent or it is a public interest case, judicial determination may be more appropriate.
Lack of court protections. If ADR is binding, the parties normally give up most court protections,
including the right to a decision by a judge or jury, based on admissible evidence, and appeal rights;
also, in the case of judicial decisions, the right to reasons for the decision.
Lack of enforceability. The durability of ADR agreements can be an issue if they lack enforceability.
Disclosure of information. There is generally less opportunity to find out about the other side’s
case with ADR than with litigation. ADR may not be effective if it takes place before the parties have
sufficient information about the strengths and weaknesses of their respective cases.
Cost of ADR. Dispute resolution practitioners may charge a fee for their services. If a dispute is not
resolved through ADR, the parties may have to put time and money into both ADR and a court hearing.
Delay. ADR adds an extra step, which may increase delay.
Fairness. ADR processes may not be as fair as court proceedings. Procedural rules and other laws
governing the conduct of court proceedings contain many safeguards to ensure the fairness of the
process and the outcome. These are not necessarily included in ADR. In addition, there may be power
imbalances if a party is not represented.
Delaying tactics. ADR processes can be used as a delaying tactic or to obtain useful intelligence on
an opponent before proceeding with litigation.
Inequality. Effective ADR requires that parties have the capacity to bargain effectively for their
own needs and interests. A party may be vulnerable where there is an unequal power relationship,
particularly if the party is not represented.
[footnotes omitted]

Uncertainty in Litigation
[4.80] Stephen Subrin, “A Traditionalist Looks at Mediation: It’s Here to Stay and Much Better Than
I Thought” (2002–​2003) 3 Nevada Law Journal 196
Can you guess who wrote the following?
The uncertainty of legal proceedings is a notion so generally adopted, and has so long
been the standing theme of wit and good humor, that he who would attempt to refute it
[4.80]
193
Civil Procedure in New South Wales
Uncertainty in Litigation cont.
would be looked upon as a man who was either incapable of discernment himself, or else
meant to impose on others. [William Blackstone, Commentaries of the Law of England, Book
III, Chapter XXII 1098 (4th ed. James Dewitt Andrews, 1898).]
This uncertainty has, I think, been exacerbated by modern procedure, which raises wide-​open questions
at every turn: what is the scope of a claim, transaction, or occurrence; what is a common question
of law or fact; what is a sufficient statement of a claim; when does justice require an amendment; …
what is relevant for discovery purposes; …
There is also evidentiary uncertainty: … For many, the legal uncertainties pale next to the factual
ones. Blackstone put it this way:
But, notwithstanding so vast an accession of legal controversies, arising from so fertile a
fund as the ignorance and willfulness of individuals, these will bear no comparison in point
of number to those which are founded upon the dishonesty, and disingenuity of the parties
… And experience will abundantly show, that above a hundred of our law-​suits arise from
disputed facts, for one where the law is doubted.
The lawyer must deal with witnesses (including one’s own) who forget, lie, misperceive, or are
otherwise mistaken. Much behavior is ambiguous, as are many documents. One does not know in
advance which evidence will be admitted, yet alone which evidence will be believed, or which tiny
shred of evidence the fact finder might latch on to as the most important. With the increasing use of
experts, one has the added uncertainty of whether one’s experts will survive the [admissibility] test,
let alone whether the expert will be believed …
Lawyers represent clients who want to know what the result will be if the case reaches final
judgment. Given the multiple points of uncertainty, it is very difficult to advise the client with any
degree of precision. At best, the attorney can advise as to a range of possible results, some of them
extremely unpleasant to the client. Settlement is a rational means of avoiding the risk of the possible
results that would be worse than settlement.

The New Lawyer: How Settlement Is Transforming the
Practice of Law
[4.90] Julie Macfarlane, The New Lawyer: How Settlement Is Transforming the Practice of Law (2008)
UBC Press
Corporate and Institutional Clients
Signs of change in client expectations are most evident in corporate and institutional practice. Like
personal clients, corporate and institutional clients have historically chosen to nominate their legal
representatives to be both managers and agents in disputing. In this traditional paradigm, the
expertise of the lawyer was seen as being sufficient and appropriate to resolve the problem, requiring
minimal input from the business client. This assumption has been changing over the past thirty years,
as corporate clients have shed the deference traditionally afforded to counsel in favour of a more
“business-​like” and hands-​on approach to legal services.
The sensitivity of institutional and corporate clients to rising legal costs has led to demands
for less costly and more efficient methods of dispute resolution and, specifically, to an increasing
appetite for early reporting, strategic settlement planning, and early dispute resolution. Maintaining
competitiveness in the business world means avoiding the absorption of corporate energy and monies
in litigation and instead finding a smart route to settlement.
194
[4.90]
Alternatives to Litigation – Negotiation and Mediation
Chapter 4
The New Lawyer: How Settlement Is Transforming the Practice of Law cont.
The ballooning costs of litigation mean that experienced commercial clients are less prepared to
be passive and more inclined to assert their expectations for the efficient management of conflict.
Some clients feel that they can do better in moving toward a business solution if they participate more
actively and directly in the discussions and welcome –​and even create –​opportunities to participate
more directly.
Another significant factor in tracking the movement toward greater client involvement in file
management is the growth of in-​house or “inside” counsel. Many commercial lawyers now work
directly with “inside” counsel. Corporate counsel are generally valued and rewarded for their abilities
to resolve disputes efficiently in a manner that allows the organization to continue to be productive.

Why We Still Litigate
[4.100] Phillip Armstrong, “Why We Still Litigate” (2008) 8 Pepperdine Dispute Resolution Law
Journal 379
The benefits of Alternative Dispute Resolution (“ADR”), particularly mediation, are well documented
and often touted. Some of these benefits are: cost savings, confidentiality, preservation of business
relationships, finality, better outcomes, and more control …
Cases which should be litigated: Another major reason business organizations continue to litigate is
because certain cases should be litigated. Every large business organization could furnish a list of those
matters that, for various reasons, it prefers to litigate rather than settle through negotiation or use of
ADR. The following list is representative, but certainly not all encompassing. Generally, companies
tend to litigate rather than employ ADR when:
(a)
an important principle is involved, eg, the credibility of one’s product;
(b)
there is a need for legal precedent;
(c)
there is a need to send a message to the marketplace;
(d)
settlement would open the floodgates to frivolous litigation;
(e)
the claim is so large that the “discipline of litigation” is called for;
(f)
the claim is bogus, eg, the business organization is in the case solely because of its deep
pockets, or perhaps because it made a product in the chain of distribution even though the
product had nothing to do with the alleged harm;
(g)
the law is heavily weighted in its favour …;
(h)
senior management is unalterably opposed to settlement;
(i)
there are multiple parties such that consensus on settlement will be difficult to achieve.

Against Settlement
[4.110] Owen Fiss, “Against Settlement” (1984) 93 Yale Law Journal 1073
Justice Rather Than Peace
The dispute-​resolution story makes settlement appear as a perfect substitute for judgment, as we just
saw, by trivializing the remedial dimensions of a lawsuit, and also by reducing the social function of
the lawsuit to one of resolving private disputes: In that story, settlement appears to achieve exactly
the same purpose as judgment –​peace between the parties –​but at considerably less expense to
[4.110]
195
Civil Procedure in New South Wales
Against Settlement cont.
society. The two quarrelling neighbours turn to a court in order to resolve their dispute, and society
makes courts available because it wants to aid in the achievement of their private ends or to secure
the peace.
In my view, however, the purpose of adjudication should be understood in broader terms.
Adjudication uses public resources, and employs not strangers chosen by the parties but public
officials chosen by a process in which the public participates. These officials, like members of the
legislative and executive branches, possess a power that has been defined and conferred by public
law, not by private agreement. Their job is not to maximize the ends of private parties, nor simply to
secure the peace, but to explicate and give force to the values embodied in authoritative texts such
as the Constitution and statutes: to interpret those values and to bring reality into accord with them.
This duty is not discharged when the parties settle.
In our political system, courts are reactive institutions. They do not search out interpretive
occasions, but instead wait for others to bring matters to their attention. They also rely for the most
part on others to investigate and present the law and facts. A settlement will thereby deprive a court
of the occasion, and perhaps even the ability, to render an interpretation … To be against settlement
is only to suggest that when the parties settle, society gets less than what appears, and for a price it
does not know it is paying. Parties might settle while leaving justice undone.

[4.120] For similar concerns to those raised by Owen Fiss, see David Luban, “Settlements
and the Erosion of the Public Realm” (1995) 83 Georgetown Law Journal 2619 (arguing
that settlement deprives the public of the litigation-​driven articulation of public norms);
Laura Nader, “Controlling Processes in the Practice of Law: Hierarchy and Pacification
in the Movement to Re-​Form Dispute Ideology” (1993) 9 Ohio State Journal on Dispute
Resolution 1 (arguing that settlement favours harmony over justice); Stephen C Yeazell, “The
Misunderstood Consequences of Modern Civil Process” (1994) Wisconsin Law Review 631
(arguing that settlement erodes the justice system by decreasing appellate review opportunities).
Whose Dispute Is It Anyway?
[4.130] Carrie Menkel-​Meadow, “Whose Dispute Is It Anyway? A Philosophical and Democratic
Defense of Settlement (in Some Cases)” (1995) 83 Georgetown Law Journal 2663
The difficulty with the debate about settlement vs adjudication is that there are many more than
two processes, as well as other variables that affect the processes, to consider. The diverse interests of
the participants in the dispute, the legal system, and society may not be the same. Issues of fairness,
legitimacy, economic efficiency, privacy, publicity, emotional catharsis or empathy, access, equity
among disputants, and lawmaking may differ in importance for different actors in the system, and
they may vary by case –​this is the strength of our common law system …
The concern that settlements deprive both litigants and the larger public realm of normatively
based solutions lies at the core of Luban’s and Fiss’s criticisms. Yet I would argue that a settlement
process may actually be more “just” in the need for both less compromise and less narrowing of
legally cognizable issues. … Noncompromise settlements offer the promise that more than money
can be at stake and that the parties can negotiate such other items as future relationships and
conduct, apologies, in-​kind trade, new contracts, etc. In my view, it is litigation, not settlement, that
has led to monetization of disputes, for money has become the proxy for all legal harms and hurts.
… More often and more troubling to those who are concerned about justice, a litigated outcome
will produce binary win-​lose results that often do not capture the “just reality.” … Thus, for me, until
litigation is permitted to recognize the ambiguities and contradictions in modern life by developing
196
[4.120]
Alternatives to Litigation – Negotiation and Mediation
Chapter 4
Whose Dispute Is It Anyway? cont.
a broader “remedial imagination,” settlement offers the opportunity to craft solutions that do not
compromise, but offer greater expression of the variety of remedial possibilities in a postmodern
world … [P]‌eople may choose settlement precisely because legislatively enacted “legal” solutions do
not meet the underlying needs or interests of parties in particular cases. Through individually adaptive
solutions in settlement we may see the limits of law and explore avenues for law reform. [P]arties may
use settlement precisely to have other, nonlegal, principles structure their disputes and relationships.
I have argued extensively elsewhere that people and entities in disputes may have a wide variety of
interests (of which legal principles may be one class) and may decide that, in any given case, social,
psychological, economic, political, moral, or religious principles should govern the resolution of their
dispute. This does not mean that such dispute resolution is not principled –​it is just not law-​principled.
Much of the critique of settlement rests on claims that negotiated settlements, more than
adjudicated claims, will be determined by the raw bargaining power of one party over another.
Assumptions abound here that power imbalances do not occur at trial, or if they do, they can be
corrected by the neutral third party cloaked in a judge’s robe …
I have here tried to make the following arguments on behalf of the “best” aspects of settlement:
1.
Settlements that are in fact consensual represent the goals of democratic and party-​initiated
legal regimes by allowing the parties themselves to choose processes and outcomes for dispute
resolution.
2.
Settlements permit a broader range of possible solutions that may be more responsive to both
party and system needs.
3.
What some consider to be the worst of settlement, that is, compromise, may actually represent
a moral commitment to equality, precision in justice, accommodation, and peaceful coexistence
of conflicting interests.
4.
Settlements may be based on important nonlegal principles or interests, which may, in any
given case, be as important or more important to the parties than “legal” considerations. Laws
made in the aggregate may not always be appropriate in particular cases, and thus settlements
can be seen as yet another “principled” supplement to our common law system.
5.
Settlement processes may be more humanely “real,” democratic, participatory, and cathartic
than more formalized processes, permitting in their best moments, transformative and
educational opportunities for parties in dispute as well as for others.
6.
Some settlement processes may be better adapted for the multiplex, multiparty issues that
require solutions in our modern society than the binary form of plaintiff-​defendant adjudication.
7.
Despite the continuing and important debates about discovery and information exchange in
the litigation process, some settlement processes (mediation and some forms of neutral case
evaluation and scheduling) may actually provide both more and better (not just legally relevant)
information for problem-​solving, as well as “education” of the litigants.
8.
When used appropriately, settlement may actually increase access to justice, not only by
allowing more disputants to claim in different ways, but also by allowing greater varieties of
case resolutions.
Thus, in its most idealized forms, settlement can be defended as being participatory, democratic,
empowering, educative, and transformative for the parties … [I]‌t is important to consider settlements
that depart from the ideal form that I have sought to defend here. If settlements are not consensually
arrived at (through mandatory and coercive court programs, or because lawyers dominate
decisionmaking, or because the choice is not real when one cannot afford to wait to litigate, or
because there are such vast disparities between the parties that “consent” cannot be given), then we
must question whether such a settlement should be enforced. As ADR becomes institutionalized in
courts, there is a danger that people will “consent” to settlements because they feel they have no real
alternative. If there is no consent, an important value justifying settlement is absent.

[4.130]
197
Civil Procedure in New South Wales
Courts as the Third Branch of Government
[4.135] Chief Justice Robert French, Perspectives on Court Annexed Alternative Dispute Resolution, Law
Council of Australia –​Multi-​Door Symposium, Canberra, 27 July 2009
The concept of court-​annexed ADR is well established and worthy of development in a way that
better integrates the various options and provides a principled basis for their connection to the judicial
process. I must, however, express a reservation about the use of the “multi-​door courthouse”. It
is the courts and only the courts which carry out the adjudication function involving the exercise
of judicial power. Their special position as the third branch of government is made explicit in the
Commonwealth Constitution and is a matter of convention in the States. Importantly, the courts are
not to be seen simply as one species of provider among a number of providers of ADR services …
In my opinion, the term “multi-​door courthouse” may have the connotation that behind each
door is a different mechanism for achieving the same or similar outcomes. But there is no doubt that
the door into a courtroom is rather unique.
In the Commonwealth Constitution it is the courts of the Commonwealth, including the High Court,
and the courts of the States invested with federal jurisdiction which exercise federal judicial power. It is
the third branch of government of which we speak. This is not just another provider of dispute resolution
services in a market of different providers. The courthouse door is not just one door among many.
I support, and have long supported, the provision of court-​annexed ADR services. It is not only
an aid to the earlier resolution of litigation, but can also be used as a case management tool to help
the parties reduce the matters in issue between them. Nevertheless, it is in the public interest that
the constitutional function of the judiciary is not compromised in fact or a matter of perception by
blurring its boundaries with non-​judicial services. So long as the clarity of the distinction is maintained,
and appropriate quality controls, including evaluative and cost-​benefit assessments undertaken, then
ADR has much to offer in connection with the judicial process.

Three Things to Be Against (Settlement Not Included)
[4.140] Michael Moffitt, “Three Things to Be Against (‘Settlement’ Not Included)” (2009) 78
Fordham Law Review 1203
Treating litigation and settlement as though they were entirely distinct processes is, of course, an
oversimplification. In practice, the two are intertwined. The fundamental rules and structure of each
clearly acknowledge the importance of the other. Modern civil procedure is structured to facilitate the
interaction between litigation and settlement. For example, many court systems require, as part of the
routine cadence of litigation, consultation with opposing parties for the purpose of exploring settlement.
Similarly, settlement takes place within the confines of the parameters established by the prospect
of litigation. Robert Mnookin and Lewis Kornhauser suggested years ago that disputants “bargain
in the shadow of the law”. [Robert H. Mnookin & Lewis Kornhauser, “Bargaining in the Shadow of
the Law: The Case of Divorce” (1979) 88 Yale Law Journal 950]. I am not convinced, as an empirical
matter, that assessments of legal entitlements always drive disputants’ settlement behavior. But
certainly, in at least many cases, disputants compare what they might receive through a settlement
with what they expect might happen in litigation. Furthermore, each disputant’s settlement behavior
is bounded by the prospect of postsettlement litigation. In this manner, private law concepts like
fraud, unconscionability, and duress affect negotiators’ behaviors precisely because litigation exists as
a possible adjunct to settlement negotiations. The prospect of litigation shapes settlement behaviors
and settlement outcomes.

198
[4.135]
Alternatives to Litigation – Negotiation and Mediation
Chapter 4
[4.150] The above extracts provide a number of reasons for and against choosing some form
of ADR mechanism over litigation, such as reducing uncertainty, greater client control and
developing better solutions to a dispute. Moffitt also explains that frequently there is a symbiotic
relationship between ADR and litigation. ADR has undoubtedly had an impact on litigation
and the court system as shown by mandatory mediation (see [4.250]). However, there is also
a concern that Courts and lawyers have co-​opted or colonised ADR. The Courts use of ADR
as a case management tool or less charitably a docket-​clearing tool may focus on promoting
settlement without seeking to achieve the benefits of developing options for producing better
quality processes and outcomes. Further “[l]‌awyers may use ADR not for the accomplishment
of a ‘better’ result, but as another weapon in the adversarial arsenal to manipulate time,
methods of discovery, and rules of procedure for perceived client advantage”.9 This can mean
that settlements are arrived at in adversarial context and simply reflect a decision that the
expected costs of trial (fees, expenses, inconvenience, and risk) exceed the expected benefits.
Perspectives on ADR and Future Trends
[4.155] Chief Justice Bathurst, Perspectives on ADR and Future Trends –​Address to the 2018 ADR
Masterclass on Making ADR Work in a #FakeNews World (11 August 2018)
8. Let me expand first on co-​optation. Courts and tribunals have increasingly adopted ADR into
their processes, initially as a voluntary option, but now in many instances a mandated pre-​litigation
step. [For example, in NSW, see: Aboriginal Land Rights Act 1983 (NSW) s 239A; Children and Young
Persons (Care and Protection) Act 1998 (NSW) s 65; Dust Diseases Tribunal Regulation 2013 (NSW) cl
34; Land and Environment Court Act 1979 (NSW) s 34AA; Privacy and Personal Information Protection
Act 1998 (NSW) s 49; Strata Schemes Management Act 2015 (NSW) s 218; Succession Act 2006 (NSW)
s 98]. This removal of consent meant that in such cases, the process lost the elements of party
control and autonomy, potentially to its detriment. In the United States, Professor Menkel-​Meadow
expressed the view that ADR has become “just another stop in the ‘litigotiation’ game which provides
an opportunity for the manipulation of rules, time, information and ultimately, money” and just
“another battleground for adversarial fighting rather than multi-​dimensional problem solving”. …
9. Professor Sourdin has noted that the emphasis on settlement rather than resolution that results
from institutionalisation may also have an impact on the way people participate in ADR –​that they
simply “go through the motions”. …
10. I think in relation to co-​optation, we are at a point where it has been recognised that there needs
to be a balance between enthusiastically embracing court-​annexed ADR, and the risk of undermining
party autonomy and consent. The Supreme Court mediation practice note, for example, states that it
is not the Court’s intention that every matter will be referred for compulsory mediation. …
14. The third challenge is the question of the public interest in disputants utilising public justice.
I won’t repeat what Professor Fiss said in his seminal article [4.100], but this need for caution has also
been echoed by former Chief Justice French [4.135], who noted that while the provision of court-​
annexed ADR services were an aid to early resolution and could help parties reduce the matters in
issue, “it is in the public interest that the constitutional function of the judiciary is not compromised”,
noting that the courts are “not just another provider of dispute resolution services in a market of
different providers”. Courts have a role beyond simply resolving disputes between individual litigants
in “articulating and enforcing social norms”.
15. One commentator has argued that there is currently an imbalance in Australia between
the competing public interests in settlement and the courts performing this constitutional role,
9
Menkel-​Meadow C, “Pursuing Settlement in an Adversary Culture: A Tale of Innovation Co-​Opted or ‘The
Law of ADR’ ” (1991) 19 Florida State University Law Review 1 at 3.
[4.155]
199
Civil Procedure in New South Wales
Perspectives on ADR and Future Trends cont.
as it is given no consideration in a court’s decision to refer to ADR. While the issue does remain
somewhat academic, it has emerged in public debate recently in relation to settlements between
public regulators and private corporations. There has been public criticism of ASIC, for example, for
negotiating settlements with corporate wrongdoers in recent years, with the suggestion that such
settlements mean that the corporation is never publically held to account.
16. This criticism is rooted in the notion that there are certain matters that should be dealt with
by a Court. Of course, it is probably indisputable that settlements are better value for money in
terms of the impact on the public purse. However, I think the debate into the future is going to
be centred on how and who should be making the choice to use ADR rather than the Courts in
matters of public concern, and where the balance should be struck between the use of ADR and the
courts performing their constitutional functions. It may also be the case that there simply needs to
be greater transparency around the use of negotiation and settlements in matters involving a public
enforcement body.
[footnotes omitted]

TYPES OF ADR PROCESSES
[4.160] There are four broad categories of dispute resolution processes: facilitative, advisory,
determinative and hybrid. The four processes are explained by the National Alternative
Dispute Resolution Advisory Council (NADRAC):
Dispute Resolution Processes
[4.170] NADRAC, Dispute Resolution Terms, The Use of Terms in (Alternative) Dispute Resolution
(September 2003)
Facilitative dispute resolution processes are processes in which a dispute resolution practitioner
assists the parties to a dispute to identify the disputed issues, develop options, consider alternatives
and endeavour to reach an agreement about some issues or the whole dispute. Examples of facilitative
processes are mediation, facilitation and facilitated negotiation.
Advisory dispute resolution processes are processes in which a dispute resolution practitioner
considers and appraises the dispute and provides advice as to the facts of the dispute, the law and,
in some cases, possible or desirable outcomes, and how these may be achieved. Advisory processes
include expert appraisal, case appraisal, case presentation, mini-​trial and early neutral evaluation.
Determinative dispute resolution processes are process in which a dispute resolution practitioner
evaluates the dispute (which may include the hearing of formal evidence from the parties) and
makes a determination. Examples of determinative dispute resolution processes are arbitration, expert
determination and private judging.
Combined or hybrid dispute resolution processes are processes in which the dispute resolution
practitioner plays multiple roles. For example, in conciliation and in conferencing, the dispute resolution
practitioner may facilitate discussions, as well as provide advice on the merits of the dispute. In hybrid
processes, such as med-​arb, the practitioner first uses one process (mediation) and then a different one
(arbitration).

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[4.160]
Alternatives to Litigation – Negotiation and Mediation
Chapter 4
Dispute Resolution Terms
[4.180] NADRAC, Dispute Resolution Terms: The Use of Terms in (Alternative) Dispute Resolution
(September 2003)
This glossary is a resource for agencies, legislators and policy makers. It explains common usage of
terms used in dispute resolution in Australia. This glossary is not intended to be as a set of definitions.
Agencies, practitioner and legislators may use these terms in different ways. Readers should therefore
check how terms are used in any particular situation …
ADR is an umbrella term for processes, other than judicial determination, in which an impartial
person assists those in a dispute to resolve the issues between them. ADR is commonly used as an
abbreviation for alternative dispute resolution, but can also be used to mean assisted or appropriate
dispute resolution. Some also use the term ADR to include approaches that enable parties to prevent
or manage their own disputes without outside assistance. See also PDR.
Adjudication is a process in which the parties present arguments and evidence to a dispute resolution
practitioner (the adjudicator) who makes a determination which is enforceable by the authority of
the adjudicator. The most common form of internally enforceable adjudication is determination by
state authorities empowered to enforce decisions by law (for example, courts, tribunals) within the
traditional judicial system. However, there are also other internally enforceable adjudication processes
(for example, internal disciplinary or grievance processes implemented by employers).
Arbitration is a process in which the parties to a dispute present arguments and evidence to a
dispute resolution practitioner (the arbitrator) who makes a determination …
Case appraisal is a process in which a dispute resolution practitioner (the case appraiser)
investigates the dispute and provides advice on possible and desirable outcomes and the means
whereby these may be achieved.
Case presentation (or Mini-​trial) is a process in which the parties present their evidence and
arguments to a dispute resolution practitioner who provides advice on the facts of the dispute, and,
in some cases, on possible and desirable outcomes and the means whereby these may be achieved.
See also mini-​trial …
Conciliation is a process in which the parties to a dispute, with the assistance of a dispute resolution
practitioner (the conciliator), identify the issues in dispute, develop options, consider alternatives and
endeavour to reach an agreement. The conciliator may have an advisory role on the content of the
dispute or the outcome of its resolution, but not a determinative role. The conciliator may advise on
or determine the process of conciliation whereby resolution is attempted, and may make suggestions
for terms of settlement, give expert advice on likely settlement terms, and may actively encourage the
participants to reach an agreement.
There are wide variations in meanings for “conciliation”, which may be used to refer to a range of
processes used to resolve complaints and disputes including:
• Informal discussions held between the parties and an external agency in an endeavour to avoid,
resolve or manage a dispute
• Combined processes in which, for example, an impartial party facilitates discussion between the
parties, provides advice on the substance of the dispute, makes proposals for settlement or actively
contributes to the terms of any agreement.
…
Dispute resolution refers to all processes that are used to resolve disputes, whether within or outside
court proceedings. Dispute resolution processes may be facilitative, advisory or determinative (see
descriptions elsewhere in this glossary). Dispute resolution processes other than judicial determination
are often referred to as ADR.
Dispute resolution practitioner is an impartial person who assists those in dispute to resolve the
issues between them. A practitioner may work privately as a statutory officer or through engagement
[4.180]
201
Civil Procedure in New South Wales
Dispute Resolution Terms cont.
by a dispute resolution organisation. A sole practitioner is a sole trader or other individual operating
alone and directly engaged by clients …
Early neutral evaluation is a process in which the parties to a dispute present, at an early stage in
attempting to resolve the dispute, arguments and evidence to a dispute resolution practitioner. That
practitioner makes a determination on the key issues in dispute, and most effective means of resolving
the dispute without determining the facts of the dispute.
Expert appraisal is a process in which a dispute resolution practitioner, chosen on the basis of
their expert knowledge of the subject matter (the expert appraiser), investigates the dispute. The
appraiser then provides advice on the facts and possible and desirable outcomes and the means
whereby these may be achieved.
Expert determination is a process in which the parties to a dispute present arguments and
evidence to a dispute resolution practitioner, who is chosen on the basis of their specialist qualification
or experience in the subject matter of the dispute (the expert) and who makes a determination.
Facilitated negotiation is a process in which the parties to a dispute, who have identified the
issues to be negotiated, utilise the assistance of a dispute resolution practitioner (the facilitator), to
negotiate the outcome. The facilitator has no advisory or determinative role on the content of the
matters discussed or the outcome of the process, but may advise on or determine the process of
facilitation.
Facilitation is a process in which the parties (usually a group), with the assistance of a dispute
resolution practitioner (the facilitator), identify problems to be solved, tasks to be accomplished or
disputed issues to be resolved. Facilitation may conclude there, or it may continue to assist the parties
to develop options, consider alternatives and endeavour to reach an agreement. The facilitator has no
advisory or determinative role on the content of the matters discussed or the outcome of the process,
but may advise on or determine the process of facilitation …
Indigenous dispute resolution refers to wide range of processes used to resolve dispute involving
Indigenous people, including the various processes described in this glossary. Other examples include
elder arbitration, agreement-​
making and consensus-​
building. In the Australian context the term
Indigenous (capital “I”) refers specifically to the Aboriginal and Torres Strait Islander peoples.
Judicial dispute resolution (or judicial ADR) is a term used to describe a range of dispute
resolution processes, other than adjudication, which are conducted by judges or magistrates. An
example is judicial settlement conference.
Mediation is a process in which the parties to a dispute, with the assistance of a dispute resolution
practitioner (the mediator), identify the disputed issues, develop options, consider alternatives and
endeavour to reach an agreement. The mediator has no advisory or determinative role in regard
to the content of the dispute or the outcome of its resolution, but may advise on or determine the
process of mediation whereby resolution is attempted. Mediation may be undertaken voluntarily,
under a court order, or subject to an existing contractual agreement.
An alternative is “a process in which the parties to a dispute, with the assistance of a dispute
resolution practitioner (the mediator) negotiate in an endeavour to resolve their dispute”.
Mini-​trial is a process in which the parties present arguments and evidence to a dispute resolution
practitioner who provides advice as to the facts of the dispute, and advice regarding possible, probable
and desirable outcomes and the means whereby these may be achieved. See also case presentation.
Ombudsman (or Ombud) is a person who “functions as a defender of the people in their
dealings with government … In Australia, there is a Commonwealth Ombudsman as well as state
and territory ombudsmen … In addition, a number of industry ombudsmen have been appointed,
whose responsibility it is to protect citizens’ interests in their dealings with a variety of service
providers, especially in industries previously owned or regulated by governments, for example
telecommunications, energy, banking and insurance”.
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Dispute Resolution Terms cont.
Private judging is a process in which the parties to a dispute present arguments and evidence to
a dispute resolution practitioner chosen on the basis of their experience as a member of the judiciary
(the private judge) who makes a determination in accordance with their opinion as to what decision
would be made if the matter was judicially determined.

NEGOTIATION
[4.190] Negotiation is a common activity that is undertaken in everyday life –​family, social
and business interactions frequently involve negotiation. However, it is also an area of study
that has been examined from an economics, sociology, psychology and legal perspective. Those
perspectives consider negotiation in terms of strategies, processes, styles, personalities and skills.
The distinguishing feature of negotiation, compared to the other forms of dispute resolution
that will be examined, is that negotiation involves no third party whose role is to facilitate,
advise or determine the resolution of the dispute. The parties are very much left to their own
devices as to how the negotiation process should proceed and what the substance of the
negotiation should be about.
Negotiation is of special interest to legal practitioners as they will often find themselves
acting as the agent or adviser to a party who is involved in negotiations. This may occur
in the context of an existing dispute or it may be part of facilitating business or personal
transactions. Indeed, in some contexts the lawyer may become the representative for the party
out of necessity, such as where the party is a corporation or some other organisation involving
numerous individuals such as a union or the group members in a class action that require a
representative with particular knowledge or skills.
The Jackson ADR Handbook summarises the advantages and disadvantages of negotiation.10
The main advantages are:
• it is very flexible and can be conducted by parties and/​or by lawyers;
• it is relatively cost effective, as only a limited amount of special preparation may be required;
• clients retain complete control of the outcome through conducting the process themselves
or by giving instructions to their lawyer and the need for their approval of any agreement
reached.
The main drawbacks are:
• success depends to a significant extent on how well the dispute has been researched and
analysed;
• success can depend on the skill of the negotiator, and the strategy and tactics employed;
• negotiation may lead to a weak or poor outcome for a person if the strengths of a case are
not properly exploited;
• the informality of negotiation can lead to confusion over the process;
• a negotiation may fail if party expectations are unrealistic, or the parties are too entrenched
in their positions.
10
Blake S, Browne J and Sime S, The Jackson ADR Handbook (2nd ed, Oxford University Press, 2016) at
[2.17]–​[2.18].
[4.190]
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Civil Procedure in New South Wales
Negotiation may take many forms.11 The main issue to be discussed here is the positional
versus interest-​based negotiation strategies as these are the dominant approaches encountered
in practice. The negotiation strategy adopted can have a major impact on both the processes
used and the result achieved. It can also be part of the way other forms of ADR such as
mediation are conducted.
Positional negotiation is traditionally associated with lawyers and is also referred to as a
zero-​sum game approach to negotiation as it mirrors litigation in the sense that one party’s
gains are another party’s losses, resources are limited and must be divided, and information
is precious and must be protected.12 The parties engage in distributive bargaining whereby
“one for me is minus one for you”.13 A focus on distributing value can prevent a negotiated
outcome or result in an outcome that is suboptimal (ie, the outcome does not serve a party’s
interests as well as possible or involves cost and delay as negotiations are protracted) because
the parties do not share information for fear of being exploited or communicate information
or misinformation to shape the other’s perceptions rather than reveal what is actually desired,
for example, extreme opening demands.14
In contrast to positional negotiation is interest-​
based negotiation which has been the
subject of the Harvard Negotiation Programme and the “Getting to Yes” text by Roger Fisher,
William Ury and Bruce Patton. To provide a brief overview of interest-​based negotiation, it is
necessary to step through a number of elements. First, interest-​based negotiation focuses on
exploring and satisfying interests rather than focusing on competing positions, such as who is
right or wrong. Interests has a broad meaning as it refers to why the person wants a particular
outcome thus encompassing needs, desires, fears and concerns which can be reflected in both
the substance of the dispute as well as the procedure (an opportunity to be heard) used in
the dispute. Positional negotiation tends to focus on what a person wants as compared to
interest-​based negotiation which focuses on why they want it. When the focus is shifted to
why something is desired then it may be possible to create solutions beyond that originally
envisaged. The classic illustration of this is the example of two people who both require a
single orange. The positional approach would simply focus on each person getting some or all
of the orange. An interest based approach looks at why they want the orange. In the example,
one person wants the rind of the orange for a cake and the other wants the juice of an orange
for a drink. If the focus is switched to interests it is possible to satisfy both persons, and indeed
to potentially satisfy them in a better manner than under a positional negotiation approach.15
The focus on interests then leads to a number of other steps. The parties must seek to
develop a range of options that satisfy their interests. This can be thought of as a “brain-​
storming” or options creating step in which the parties seek to expand the pie and therefore
move beyond the idea of resources being limited. To evaluate the options or alternatives that
are put forward, Fisher, Ury and Patton have developed the concept of “Best Alternative to
a Negotiated Agreement” or a person’s BATNA. Developing a BATNA requires a person to
11
15
See, for example, Dickinson M, “An Evaluation of Non-​Adversarial Models of Negotiation” (2009) 20 ADRJ
212; and Leventhal L, “The Foundation and Contemporary History of Negotiation Theory” (2006) 17 ADRJ 70.
See [4.50] and Menkel-​Meadow C, “Toward Another View of Legal Negotiation: The Structure of Problem
Solving” (1983–​1984) 31 University of California Los Angeles Law Review 754 at 756–​757.
White J, “Review Essay: The Pros and Cons of ‘Getting to YES’ by Roger Fisher & William Ury” (1984) 34
Journal of Legal Education 115 at 116.
Mnookin R, Peppet S and Tulumello A, Beyond Winning –​Negotiating to Create Value in Deals and Disputes
(The Belknap Press of Harvard University Press, 2000) pp 18–​25.
Alexander N and Howieson J, Negotiation –​Strategy Style Skills (2nd ed, LexisNexis, 2010) p 40.
204
[4.190]
12
13
14
Alternatives to Litigation – Negotiation and Mediation
Chapter 4
consider what their best position would be if the negotiation fails. The aim of the negotiation is
to improve on the BATNA but also to be realistic about the position they will find themselves in
without an agreed solution. Interest-​based negotiation also requires that there be independent
criteria for assessing the options that are developed so that the parties have a way in which to
evaluate the fairness of options.
Overlaying the interest based approach to negotiation are various skills or approaches
that facilitate it. These include developing co-​operation rather than competition, promoting
collaboration including the sharing of information, and effective communication to ensure
that interests and options are clearly expressed and understood. Further the negotiator in
trying to adopt or give effect to an interest based approach must be alive to the fact that
another negotiator may take a different approach, including a positional approach. As a result
skills, such as building trust and reciprocity, determining what information is needed, what
information can be shared at various stages and being able to use questioning and listening to
develop the interest based approach, become crucial.
It has also been argued that in many negotiations at some point the pie cannot be expanded
further and there must be a resort to distributional bargaining, that is, the pie must be split up
as part of the resolution of the dispute.16 Even one of the authors of “Getting to YES” accepted
that positional bargaining was an effective way to proceed in some categories of negotiations:17
On single-​issue negotiations among strangers where the transaction costs of exploring interest[s]‌
would be high and where each side is protected by competitive opportunities, haggling over
positions may work better than joint problem solving. A typical case would be negotiating a
sale on the New York Stock Exchange.
Consequently, a “skilful negotiator moves nimbly between imaginative strategies to enlarge
the pie and conservative strategies to secure an ample slice no matter what size the final
pie turns out to be”.18 Negotiation skills need to be learnt and developed just as much as
advocacy, drafting or other “legal” skills for a person to be an effective lawyer.
Comparison of positional and interest-​based negotiation
[4.200]
Positional Negotiation
Interest-​based Negotiation
Parties are opponents or adversaries
Parties are collaborative problem solvers
Goal is to win or give up as little as possible
Goal is to satisfy all parties’ interests
Assert correctness of position/​demand
Identify interests
Make minimal concessions in relation to position/​demand
Develop options –​expand the pie
Avoid disclosure of information –​communication is
limited
Share and seek out information –​communication
is enhanced
Assert rights that support position/​demand
Determine independent criteria for assessing options
Disagree with opponents position
Listen to parties explication of their interests
Make concessions slowly and incrementally to try and
obtain agreement
Evaluate options to satisfy interests
16
17
18
White J, “Review Essay: The Pros and Cons of ‘Getting to YES’ by Roger Fisher & William Ury” (1984) 34
Journal of Legal Education 115 at 116.
Fisher R, “Comment on James White’s Review of ‘Getting to YES’ ” (1984) 34 Journal of Legal Education 120 at 123.
Mnookin R, Peppet S and Tulumello A, Beyond Winning –​Negotiating to Create Value in Deals and Disputes
(The Belknap Press of Harvard University Press, 2000) p 9.
[4.200]
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Civil Procedure in New South Wales
What role does the law play in interest-​based negotiation?
[4.210] In positional bargaining, the law is often put forward as recognising the rights that
support the position taken by a party. For example, the law supports a right to be compensated
for the breach of contract. In interest-​based negotiation, the law may be utilised to determine
a person’s BATNA and to develop independent criteria. A person’s BATNA may be recourse
to litigation with its costs, delay and uncertainty or the BATNA may be another outcome
informed by litigation. The independent criteria may include reference to substantive law in
the sense of precedent or legal principles that may provide guidance as to how a court would
resolve the dispute but law is but one criterion that may be relevant.19 However, too ready a
resort to the result the legal system would produce may prevent innovative and idiosyncratic
solutions.20
MEDIATION
[4.220] Mediation is the most widely used form of ADR. It involves a facilitated negotiation
aimed at reaching an agreement. A neutral third party (the mediator) assists and facilitates an
agreement between the parties. Unlike litigation where the parties must convince the judge of
the correctness of their position, the parties do not seek to convince the mediator but rather
to persuade the other party.
The mediator is chosen by parties unless mediation is connected to a court (eg, family law
mediation). The mediator chosen will depend on the type of mediation that the parties wish
to undertake. The mediator usually directs process but has no advisory or determinative role.
However, the flexibility of mediation means that the mediator may adopt a number of roles.
This has given rise to attempts to classify types or models of mediation. One leading example
is Nadja Alexander’s Mediation Metamodel which contains six models:21
• Expert advisory mediation –​the mediator employs specialist legal or technical skills to
guide the parties towards a settlement within a positional bargaining framework.
• Settlement mediation –​the mediator specialises in process but aims to guide the parties
towards a settlement within a positional bargaining framework.
• Facilitative mediation –​the mediator specialises in process but employs interest-​based
negotiation thus encouraging the parties to develop their own solutions.
• Wise counsel mediation –​the mediator is usually selected because of their standing in
the community which may result from their specialist legal, technical or diplomacy skills
but they adopt interest-​based negotiation to encourage the parties to develop their own
solutions.
• Tradition-​based mediation –​similar to wise counsel mediation but with a greater concern
for interests beyond the parties such as the community or society. It is frequently associated
with indigenous societies.
19
20
21
Astor H and Chinkin C, Dispute Resolution in Australia (2nd ed, Butterworths, 2002) pp 118–​119.
Menkel-​Meadow C, “Toward Another View of Legal Negotiation: The Structure of Problem Solving” (1983–​
1984) 31 University of California Los Angeles Law Review 754 at 790–​791.
Alexander N, “The Mediation Metamodel: Understanding Practice” (2008) 26(1) Conflict Resolution
Quarterly 97. See also Wade J, Representing Clients at Mediation and Negotiation (Bond University School
of Law, 2003); and Riskin L, “Who Decides What? Rethinking the Grid of Mediator Orientations” (2003)
Dispute Resolution Magazine 22.
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[4.210]
Alternatives to Litigation – Negotiation and Mediation
Chapter 4
• Transformative mediation –​the mediator specialises in process, not just of negotiation but
of psychology and reconciliation, and goes beyond interest-​based negotiation with a view
to restoring relationships.
In legal practice in NSW mediations are most likely to be some combination or variation on
the first four models described above. Facilitative mediation is the norm or goal that most
mediations are thought to aspire to but in seeking to achieve a resolution mediators may
adopt more expert advisory roles or facilitate positional bargaining.
The Jackson ADR Handbook contrasts facilitative mediation and evaluative mediation.
The latter equates with Alexander’s expert advisory or settlement mediation models. While
facilitative mediation involves the mediator assisting the parties to solve their own problems,
the mediator’s role is not passive. The facilitative mediator will:
• ask questions that test the strengths and weaknesses of each side’s case;
• explore each party’s situation and help them to identify what they really need or want to
achieve from the dispute;
• encourage the parties to think about the likely outcome of litigation and costs of obtaining
that outcome;
• focus each party’s attention on his or her underlying objectives and needs, rather than on a
strict analysis and evaluation of the merits of the case;
• help the parties to work on a creative solution that is in their best interests;
• assist the parties to negotiate more effectively by formulating offers in a way that may
be more attractive to the other side, and consider the timing and staging of offers and
concessions.22
A facilitative mediator will not express a view on the merits of a party’s case or evaluate the
likely outcome of the dispute or put forward his or her own proposals for settlement. An
evaluative mediator will employ some or all of the above steps to facilitate resolution but will
also go further if asked and evaluate issues or claims, and suggest settlement options. The
evaluation will usually be from a legal perspective, which may necessitate a mediator who
was a former judge or experienced legal practitioner. The authoritative statement from such
a person may assist in resolution. However, other areas of expertise may be required if the
underlying dispute requires that expertise to evaluate the claims and settlement options. The
disadvantage of evaluative mediation is that it may require the mediator to side with one of
the parties threatening the mediator’s independence, the evaluation may harden positions and
reduce the scope for compromise, and the mediator may be asked to evaluate the dispute with
only partial information.23
The mediation process is flexible but usually involves the following steps over one or more
days:24
• Mediators, parties and any legal representatives introduce themselves and the mediator
explains the process and “ground rules” for the mediation.
22
23
24
Blake S, Browne J and Sime S, The Jackson ADR Handbook (2nd ed, Oxford University Press, 2016) at [14.06].
Blake S, Browne J and Sime S, The Jackson ADR Handbook (2nd ed, Oxford University Press, 2016) at [14.09].
See Spencer D, Principles of Dispute Resolution (Thomson Reuters, 2011) pp 53–​68; and Astor H and Chinkin
C, Dispute Resolution in Australia (2nd ed, Butterworths, 2002) pp 139–​145.
[4.220]
207
Civil Procedure in New South Wales
• Opening statements by each party in turn, in which they express their view of the dispute
and the issues involved.
• Identification of issues and development of an agenda.
• Mediators support the exploration of the issues identified by the participants by encouraging
and guiding discussion between them.
• Confidential private sessions in which the mediator can test or develop options, while the
other party has time to consider their options and discuss options with advisors.
• Evaluation of options or offers.
• Parties negotiate an agreement or terminate the mediation.
• If participants agree on some or all of the issues an agreement is prepared and signed.
In some mediations, there may be a preliminary conference. This is an opportunity for the
mediator to deal with administrative arrangements such as the date and location of the
mediation, who will attend, and to set a timetable for the exchange of position papers and/​
or documents. In other mediations, these matters may be dealt with in a formal mediation
agreement.
Why choose mediation?
[4.230] Many of the reasons for choosing ADR also apply to choosing mediation. In brief,
they may be summarised as:25
• the parties are required to mediate by law or contract;
• it can be faster and cheaper than litigation, assuming a resolution is reached;
• it can narrow the issues for litigation if unsuccessful;
• it provides confidentiality;
• it can provide broader or more flexible remedies than a court;
• it maintains relationships; and
• it provides greater client satisfaction through increased involvement and ability to
communicate directly with an opponent.
Alternatively mediation may be examined from the perspective of what it offers in comparison
to negotiation. Two main advantages arise, first, the process is more structured and so a
framework for exploring resolution is able to be followed. In particular, a mediator who
adopts a facilitative approach and employs interest-​based negotiation techniques will take
the parties through particular steps aimed at identifying interests and options for resolution.
Second, there is an independent third party who can break impasses, facilitate the devising of
solutions and generally keep the parties focussed and moving forward. The mediator can seek
to diffuse strong feelings or antagonism between the parties. The mediator can test suggested
solutions put forward by a party.
However, mediation may be unsuitable where a party desires to create a precedent,
urgent interlocutory injunctions are needed to protect a party’s position, the other party is
not trustworthy or prepared to participate in good faith, resolution cannot be achieved by
25
Hardy S and Rundle O, Mediation for Lawyers (CCH, 2010) Ch 1.
208
[4.230]
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Chapter 4
agreement among the participating parties (ie, it requires actions outside their control) or the
power imbalances make the process unlikely to work or removes consensuality.
Role of the lawyer
[4.240] Although mediation provides for greater client involvement and introduces the
mediator who has a role to play in facilitating resolution, the lawyer still has important
functions to fulfil. For example, a lawyer may:26
• advise if the dispute is suitable for mediation;
• describe the process of mediation to the client;
• contact the other party and/​or mediator for the client;
• negotiate on the client’s behalf;
• prepare the matter for mediation which may include legal analysis, fact gathering and
drafting of position interest papers;
• attend the mediation with the client in order to advise during the course of the mediation;
• reduce power imbalances and seek to protect the client’s interests;
• draft a settlement agreement; and
• if necessary, obtain the appropriate court order to put an end to court proceedings.
However, in some mediations no lawyers may be present. The presence of lawyers may
create a focus on legal rights and an adversarial approach to the dispute that can be counter-​
productive. Of course, lawyers are able to conduct themselves in a manner that avoids this.
The role the lawyer plays has been explained by Dr Olivia Rundle who devised a spectrum
of roles that lawyers may play in mediation, differentiated by their levels of involvement:27
Absent advisor
Less Involvement
Advisor observer
Expert contributor
Supportive professional
participant
Spokesperson
More Involvement
The absent advisor assists the client to prepare for the mediation but does not attend
the mediation session itself. The absent advisor’s role is to support the client to participate
effectively in the process. This is a cost-​effective approach to mediation provided the client
is able to adequately represent themselves. The advisor observer performs the same role as
the absent advisor, but the lawyer attends the mediation. The lawyer observes but does not
interact directly with the mediator, other party or other lawyer. The lawyer advises the client
as requested during the mediation. The expert contributor performs all of the tasks of the
advisor observer. In addition, the lawyers engage with one another during the mediation about
the legal issues, that is, views on the applicable law.
The supportive professional participant works with the client to prepare for the mediation
and supports the client through the mediation process, by working collaboratively towards
an acceptable outcome. The lawyer and client work as a team. There is no clear partitioning
26
27
See, for example, Hardy S and Rundle O, Mediation for Lawyers (CCH, 2010) Ch 5.
Rundle O, “A Spectrum of Contributions That Lawyers Can Make to Mediation” (2009) 20 Australasian
Dispute Resolution Journal 220. See also The Law Council of Australia’s Guidelines for Lawyers in Mediation
(August 2011).
[4.240]
209
Civil Procedure in New South Wales
of the roles of lawyer and client. The lawyer provides legal advice but may also assist in
determining the client’s interests and settlement offers.
The lawyer “spokesperson” speaks on behalf of her or his client throughout the mediation.
The client has a very limited role in the process. The parties merely observe rather than
participate directly and obtain legal advice from and provide instructions to their lawyers
outside the joint mediation sessions. This model may be appropriate when mediation would
otherwise be inappropriate because of capacity or power imbalance issues.
As Rundle concludes, there is no correct model that lawyers must follow. Rather, the model
will depend on the needs of the client, including his or her financial resources and abilities to
negotiate effectively.
Representing Clients from Courtroom to Mediation Settings
[4.244] Donna Cooper, “Representing Clients from Courtroom to Mediation Settings: Switching
Hats between Adversarial Advocacy and Dispute Resolution Advocacy” (2014) 25 Australasian Dispute
Resolution Journal 150
Similarities in the knowledge and skills that adversarial and non-​adversarial advocates
have to demonstrate
Many lawyers in the course of their working lives will be engaged in representing clients in both
adversarial court hearings and non-​adversarial contexts. Some knowledge and skills will overlap and
some will be distinct to their non-​adversarial and adversarial roles. The following are a few of the key
areas that can be drawn upon in both roles.
Understanding of the law and legal rights
In both litigation and evaluative mediations, lawyers will ensure that their clients understand their
legal rights. At the outset, lawyers will take detailed instructions to become fully appraised of both the
legal issues and their clients’ personal situations. After taking instructions, and gathering any necessary
information, legal advice can be provided, including as to the likely range of judicial outcomes if a
case proceeds to court.
Such initial advice provides clients with an honest assessment of their legal rights and encourages
realistic expectations as to the settlement or litigation outcomes that can be achieved. If clients are
hopeful of a result well outside of the expected range, lawyers can work towards these expectations
becoming more reasonable. Such advice provides clients with a foundation upon which to make
informed decisions when considering offers during mediation. It also assists clients to assess whether
it will be worthwhile going to the expense of taking matters to court.
Lawyers now have a duty to advise clients of settlement options before taking a case to court. The
Australian Solicitors Conduct Rules state that:
A solicitor must inform the client or the instructing solicitor about the alternatives to fully
contested adjudication of the case which are reasonably available to the client, unless the
solicitor believes on reasonable grounds that the client already has such an understanding of
those alternatives as to permit the client to make decisions about the client’s best interests
in relation to the litigation. …
Although a discussion of legal rights is not strictly necessary in the context of facilitative mediations,
in practice clients often want to be appraised of their legal rights and what may be a “fair” outcome
before participating in mediation and before entering into any agreement.
Understanding of procedure and client roles
When attending a court hearing or mediation, lawyers will be appraised of the process they will
be engaged in and of any procedural requirements, such as court rules or the particular model of
mediation and the steps in the process. They will also educate their clients about their participation in
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[4.244]
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Representing Clients from Courtroom to Mediation Settings cont.
the process. Clients need to understand the objectives, the steps that will be followed and, perhaps
most importantly, what role they will be expected to play.
In a court hearing, a client may be required to give evidence and will need information about the
context in which this occurs and the manner in which questions will be asked. In a mediation process
(particularly in facilitative mediation) the client will be expected to provide an opening statement,
participate in integrative negotiations, and generate settlement options. The client will need to have
some time beforehand to prepare for these activities. The parties in a facilitative mediation will need
to appreciate that they are expected to play an active role during the session and they will be asked
to think of options and solutions. In fact, it is often the party’s active participation in the content and
outcome of a process that is the key to client satisfaction and perceived “fairness” of the process.
Thorough preparation and gathering of relevant information.
Gathering information relevant to the dispute and having it available on the day of the court hearing
or mediation is extremely important. In a litigation context, information must be placed before the
court in a manner that complies with procedural requirements and the rules of evidence. Information
will be contained in written form in court documents and may also be available via evidence obtained
by subpoenas. It may also be presented orally via the evidence of the parties and their witnesses and
in the form of legal submissions.
In mediation, lawyers and clients need to have organised all information relevant to making an
informed decision in relation to settlement. Valuations may need to be obtained for financial disputes
or medical reports for personal injury cases. For a family law parenting dispute, a lawyer can assist the
client to organise information relevant to the issues in dispute, such as school holiday dates, public
transport timetables, options for age-​appropriate parenting schedules, appropriate supervisors, and
information about the availability and suitability of contact centres.
In both settings lawyers can encourage the other side to ensure that all relevant information they
have in their possession is available prior to the mediation. However, a difference is the extent to
which both parties can be compelled to produce relevant information if one or both are not willing
to voluntarily make it available. For example, if a party is not willing to make full disclosure and
participate in “good faith”, mediation may not be appropriate at all and court proceedings might be
necessary so that orders can be obtained to compel the party to produce the relevant documents.
An understanding of the client
In both adversarial and non-​
adversarial processes, legal representatives will need to acquire an
understanding of their clients. For example, what is the client seeking to achieve in terms of the
outcome of the dispute? What is his or her personal and financial situation and will he or she be able
to cope with and afford the court process? If oral evidence is required, a party’s credibility may become
important, as well as how the client may perform when giving evidence in the witness box and what
sort of impression he or she may make on the judicial officer. Similarly, a lawyer preparing for mediation
will have an understanding of the background to the dispute and how his or her client may cope with
the mediation process. An assessment will need to be made of how articulate the client is and, for
example, whether lawyer assistance will be required during the opening statement at the mediation.
Communication skills
Whether representing clients in court or in mediation, high-​level communication skills are essential.
Lawyers need to be able to listen actively to clients and provide them with clear information and legal
advice in plain English. In a court setting, lawyers will require effective written communication skills
so that court documents are drafted in a clear and concise way, containing all relevant and admissible
information. When appearing in court, they need to demonstrate effective oral communication skills
so that their submissions are made in a logical fashion and they can respond appropriately to any
questions or directions made by the judicial officer. In both contexts, lawyers can use skills such as
paraphrasing, summarising and reframing to gather the necessary information from their clients and
to deal with those clients who may be upset or emotional.
[4.244]
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Civil Procedure in New South Wales
Representing Clients from Courtroom to Mediation Settings cont.
Duty to follow the client’s instructions
In both processes, lawyers have a duty to follow the client’s instructions. This duty can cause challenges,
particularly where clients may have unrealistic expectations about settlement outcomes. In both contexts,
lawyers can work with clients to provide them with legal advice and a realistic idea of what outcomes
they may achieve if their cases go to court. They can also discuss with clients the benefits of settlement
and this will be explored further below in relation to the ethical duty to act in the client’s best interests.
In mediation this duty can sometimes conflict with lawyers encouraging clients to take collaborative
and problem-​solving approaches if clients have not been educated in these strategies. Clients need to
be coached as to the goals of mediation and how to engage in integrative negotiations. However, in
the end, lawyers have a duty to comply with their clients’ instructions even if in some cases they may
perceive them to be unrealistic.
Differences in the knowledge and skills that non-​adversarial advocates are required to
demonstrate
As discussed above, whether operating in court or mediation settings, there is a common set of
knowledge and skills that lawyers can draw upon. However, there is also a set of knowledge and skills
that, it could be argued, are specifically relevant to non-​adversarial advocacy. Lawyers can apply this
knowledge when representing clients in mediations and when acting in a non-​adversarial capacity,
whether in negotiations, conciliations or less adversarial processes. The following are a few of these
distinct areas which will be discussed in the context of lawyers representing clients in mediations.
Understanding underlying interests and the causes of conflict
When preparing for mediation it will assist to have an understanding of the underlying causes of
conflict and of the client’s underlying interests. Lawyers can prepare clients to participate in integrative
negotiations in mediation by encouraging them to think about their underlying concerns, needs and
interests and some of the possible causes of conflict. The client can be encouraged to consider some
suitable options which lie outside his or her legal positions, since remaining entrenched in positions
once the session has commenced will usually mean that settlement cannot be achieved. They can also
prepare their clients to engage in collaborative problem-​solving. …
Assessment of power imbalances
Before organising mediation, a discussion needs to take place with the client as to whether there
are any factors that could lead to an inequality of bargaining power. In particular, it is important to
discover whether there are any power imbalances that may impact to such an extent that the client
will be unable to negotiate assertively and effectively with the other party. Circumstances that can
impact upon the ability to negotiate include where the client has a psychiatric or psychological disorder
or physical disability, where there are cultural issues, and/​or language difficulties. In family disputes,
the source of an overwhelming power imbalance might be where there has been a history of (or
current) family violence, particularly coercive or controlling violence. In some cases, concerns as to
the level of assertiveness that a client could achieve with a former partner and/​or safety concerns may
mean that mediation is inappropriate, and negotiation between lawyers and litigation are the only
suitable options. In some scenarios, it might be appropriate to assess whether power imbalances can be
addressed by structuring the dispute resolution process in an appropriate way or by the use of certain
strategies. For example, the lawyer can inform the mediator of the relevant issues and history. In turn,
the mediator can structure the process in such a way that the power imbalances are minimised, for
example, by way of shuttle or telephone link-​up so that the parties will have no face-​to-​face contact.
In this context, the benefits of legal representation in mediation are highlighted. A lawyer can
provide support to the less powerful party and assist him or her to participate effectively, put concerns
and interests forward, and help the party to remain assertive throughout the process.
Understanding the different negotiation models
An understanding of different negotiation models also assists in preparation for, and participation in, the
mediation process. Lawyers can assist their clients to prepare to participate in integrative negotiations,
212
[4.244]
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Representing Clients from Courtroom to Mediation Settings cont.
which include interest-​based strategies and the use of trade-​offs and concessions, termed “logrolling”.
They also require an understanding of distributive negotiation because this model is often used in the
mediation of legal disputes. However, it can assist if clients are encouraged to attempt settlement
at the outset using integrative negotiation strategies. A discussion of the possible options outside
of a client’s initial position will assist with option generation. To be adequately prepared, clients will
need to gather necessary information to enable them to consider and develop more creative options.
This type of knowledge is also important for litigators to discuss with their clients because they will
continually be looking to see if settlement can be achieved without the need for a judicial officer to
make a decision for the clients.
Understanding the different mediation models
In legal settings, there are two key models of mediation that tend to be used: “advisory” and
“facilitative”. Advisory processes are those in which the mediator is not independent of the content of
the dispute. He or she can give information and advice as to the range of likely court outcomes if the
case proceeds to court and will actively encourage the participants to reach an agreement within this
anticipated range. Evaluative mediation falls into this category. This role can be contrasted with that
of a facilitative mediator who is more independent, assisting parties to generate their own options and
come to a resolution, without offering views about appropriate settlement options. When organising
mediation, legal representatives can make an informed choice as to which type of model might be
appropriate for a particular client in a particular dispute. For example, high conflict cases that have
been unresolved for some time may more likely benefit from an evaluative as opposed to a facilitative
mediation model where parties need to be committed to settlement and able to generate their own
options and solutions. In contrast, the facilitative model often suits family law parenting cases because
it assists parents to come up with their own options and solutions that will be tailor-​made to suit both
their needs and the best interests of their children.
An appreciation of the spectrum of roles that lawyers play in mediation
In litigation, the role of lawyers tends to be fairly fixed. They should present their clients’ cases in
the best possible light and seek to highlight the negative aspects of the other parties’ cases. The
adversarial role is clearly defined in that the lawyer will negotiate on the client’s behalf, answer the
opposing lawyer’s correspondence, draft documents, organise witnesses, organise subpoenas if
needed, and appear in court.
In mediation, the lawyer representative’s role is not as distinct. In some forums there is guidance
for lawyers as to what role they should play; in others, it needs to be negotiated with the client and
mediator. Rundle has identified a spectrum of roles that lawyers may play in mediation, differentiated
by their levels of involvement: “absent advisor”, “advisor observer”, “expert contributor”, “supportive
professional participant”, and “spokesperson”. For example, in a facilitative mediation where the
client is expected to deliver an opening statement and develop options and solutions, it might be
appropriate for a lawyer to play the “advisor observer”, adopting a fairly neutral role but being
available to support the client and provide advice and negotiation assistance in private meetings.
In an evaluative mediation, the role of “supportive professional participant” might be suitable –​if
the mediator requires the parties to provide opening statements, lawyers can then provide support,
negotiation assistance and drafting skills in the event that agreement is reached.
For a client subject to strong power dynamics, such as problems with family violence in a family
mediation, it may be appropriate for the lawyer to act as “spokesperson”, talking on behalf of the
client and taking a very active role. This may be necessary where clients do not feel confident enough
to speak on their own behalf and request that the lawyer provide this extra assistance. The appropriate
role for lawyers to play will depend on their clients and cases and will need to be negotiated with
clients prior to the mediation.

[4.244]
213
Civil Procedure in New South Wales
Position statements
[4.248] While the mediation process is largely about dialogue and oral communication, the
position statement is an important written form of communication between the parties and
the mediator that takes place prior to the mediation. The position statement is not a court
form or formal document so that there are not set rules for drafting a position statement.
Lawyers or parties can structure the document in the manner which they best believe will
assist in resolving the dispute or at least provide for a constructive dialogue. This usually
means the following:
• plain English that can be understood by the parties and the mediator;
• clear and concise expression;
• logically ordered with headings and use of bullet points;
• respectfully worded;
• persuasive. This is an opportunity to communicate directly with an opponent and a
mediator.
In relation to content, there are, again, no set rules. However, the Jackson ADR Handbook
offers the following guidance as to matters that it regards as “essential” to include in a position
statement:
• Heading: it should be headed up with the names and description of the parties (eg, plaintiff,
lessor or sub-​contractor) and marked “Without Prejudice and for use in the Mediation
only”. (In Australia, it is common for a mediation paper to be marked confidential as well
as without prejudice.) It should clearly identify the party on whose behalf the statement
is made.
• Formalities: it should also include the date and time of the mediation, the name of the
mediator, a list of the individuals attending the mediation on behalf of the party on whose
behalf the statement is made, and their connection with the dispute (eg, solicitor for the
plaintiff or chief executive officer of the plaintiff).
• Facts: it should briefly outline the key facts of the case and the nature of the matters in
complaint.
• Issues: it should identify the issues in the case, both legal and factual. The statement should
also identify the key issues that are of vital importance to the parties at the date of the
mediation. This may be different from the list of factual and legal issues that arise in the
case as it involves focusing on the matters that are of primary concern to the party. If these
issues are resolved, all else tends to follow or fall away, so the mediation will primarily
focus on these issues.
• Outline of the party’s case on issues: the statement needs to clearly set out the party’s position
in relation to each of the issues. The statement may make brief reference to statements of
case, key documents or evidence, and matters of law that support the party’s position. It
is important that this document persuades the other side of the merits of the case, and
therefore the strength of the party’s negotiating position in relation to the disputed issues
of fact or law. However, it should be written in a non-​confrontational style.
• The party’s interests and objectives: the key objectives that the party wants to achieve at the
mediation should be identified. This section can draw attention to the costs of proceeding
to trial, the element of irrecoverable costs, the desire to preserve relationships, the time
214
[4.248]
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Chapter 4
it will take to resolve the dispute if mediation is unsuccessful or any other factors that
influenced the party to mediate rather than litigate the dispute. It should also make clear
the party’s commitment to resolving the dispute, if possible, at the mediation. …28
It may also be helpful to include in a position statement, or as an annexure, a chronology of
events and a list of the main actors/​parties involved in the dispute.29
The term “position statement” can be misleading where the aim is to employ interest-​
based negotiation which is synonymous with facilitative mediation. A position statement does
not have to be limited to use with positional negotiation. As the Jackson ADR Handbook
observes, the position statement should address a party’s interests and objectives. The position
statement should facilitate rather than hinder interest-​based negotiation.
Compulsory mediation
[4.250] Compulsory mediation refers to mediation ordered by a court which has power to
refer a matter to mediation without the parties consent. The development of compulsory
mediation has seen an increase in the use of mediation but has also prompted questions about
the efficacy of mandating mediation against a party’s wishes and the likelihood of success
of such mediations. The Civil Procedure Act 2005 (NSW) (CPA) permits the court to make
orders for compulsory mediation. The Victorian Law Reform Commission considered support
for compulsory mediation in its 2008 report into the Civil Justice system.
Civil Justice Review
[4.260] Victorian Law Reform Commission, Civil Justice Review, Report No 14 (2008) pp 258–​259
It is already possible for courts to refer parties to mediation, even without their consent. However, as
noted above, there are divided views over the desirability of making such compulsory referrals. There
is considerable support for judicial referral of parties to mediation without consent. In Remuneration
Planning Corporation Pty Limited v Fitton [2001] NSWSC 1208, at [3]‌, Justice Hamilton of the NSW
Supreme Court noted that mediations ordered over the objection of the parties might often be
successful:
Since the power was conferred upon the Court, there have been a number of instances in
which mediations have succeeded, which have been ordered over opposition, or consented
to by the parties only where it is plain that the Court will order the mediation in the absence
of consent. It has become plain that there are circumstances in which parties insist on taking
the stance that they will not go to mediation, perhaps from a fear that to show willingness
to do so may appear a sign of weakness, yet engage in successful mediation when mediation
is ordered.
More recently, Justice Spigelman, Chief Justice of NSW, commented:
One matter that appears somewhat counter intuitive is the conferral upon courts of a power
to order mediation. This was once thought to be pointless because it appeared unlikely
that a party who was ordered to mediate would be prepared to enter such negotiations in
a co-​operative manner. That has proven to be false. Reluctant starters have often proved
to be willing participants in the negotiation process. It appears that many litigants have
either not understood, or not been advised by their lawyers about, the weakness in their
case, or have adopted a negotiating posture from the outset that they could not possibly
28
29
Blake S, Browne J and Sime S, The Jackson ADR Handbook (2nd ed, Oxford University Press, 2016) at [14.67].
Blake S, Browne J and Sime S, The Jackson ADR Handbook (2nd ed, Oxford University Press, 2016) at [14.71].
[4.260]
215
Civil Procedure in New South Wales
Civil Justice Review cont.
lose. A formal order of the court requiring mediation has overcome such inhibitions and
has proven particularly successful in a number of spheres of jurisdiction. [The Hon James
J Spigelman, Chief Justice of New South Wales, Commercial Litigation and Arbitration: New
Challenges (paper presented at the First Indo Australian Legal Forum, New Delhi, 9 October
2007).]
NADRAC’s view is that:
[T]‌he potential benefits, both in providing parties with a further opportunity to resolve
their dispute and in ensuring publicly funded and scarce judicial resources are used only in
determining intractable disputes, justify the continued use of court ordered ADR.

[4.270] Section 26 of the CPA empowers the court to refer proceedings to mediation.
Section 25 defines mediation as “a structured negotiation process in which the mediator, as a
neutral and independent party, assists the parties to a dispute to achieve their own resolution of
the dispute”. Section 26 provides that all or part of a proceeding may be referred to mediation
if the court “considers the circumstances appropriate”, even if the parties do not consent.
The court can make directions “regulating the practice and procedure to be followed in a
mediation, including the preparation and service of documents”: UCPR r 20.2.
The parties have a duty to participate in the mediation in “good faith”: CPA s 27. The duty
to act in good faith was considered in Waterhouse v Perkins [2001] NSWSC 13. The procedure
in a mediation session requires that a person who attends the mediation has authority to settle
the proceedings and they may attend with legal representatives: UCPR r 20.6.
Statements made in the course of mediation are protected (as they are in judicial proceedings)
in that they cannot give rise to an action in defamation: CPA s 30. A mediator cannot disclose
information obtained in the mediation unless authorised by the CPA: s 31 (see discussion
of privilege in Chapter 14 at [14.370]–​[14.410]). A mediator to whom the court refers a
proceeding has the same protection and immunity as a judicial officer: CPA s 33.
The court can make orders to give effect to any agreement or arrangement arising out of a
mediation session: CPA s 29.
The particular circumstances may warrant an order for mediation. For example, the
litigation is complex and protracted: Idoport Pty Ltd v National Australia Bank Ltd [2001]
NSWSC 427 and Daya v CNA Reinsurance Co Ltd [2004] NSWSC 795. Or it may be ordered
where the court is satisfied that the parties’ approach to the resolution of the proceedings
is being unduly influenced by subjective considerations and may benefit from a skilled
conciliator: Singh v Singh [2002] NSWSC 852. An order has been made where the parties
have served all their evidence and would therefore not be disadvantaged by a mediation: New
Idafe Inc v Barnard [2007] NSWSC 1107.
The Supreme Court’s approach to mediation is further elaborated on in Practice Note SC
Gen 6 Supreme Court –​Mediation, 9 March 2018 which states (in part):
Referrals generally
5.
Part 4 of the CPA permits the Court at any stage of the proceedings, by order, to refer parties
to mediation where, in the opinion of the Court, mediation appears appropriate. The Court’s
power does not depend on the consent of the parties, or of any of the parties.
6.
It is not the intention of the Court that mediation will be ordered in all proceedings.
216
[4.270]
Alternatives to Litigation – Negotiation and Mediation
Chapter 4
7.
The parties themselves may, at any time, agree to mediation, nominate a mediator and request
the Court to make the appropriate orders.
8.
The Court may consider ordering mediation on the motion of a party, or on referral by a
registrar, or on the Court’s own motion. Where mediation is ordered, the parties will usually
agree on the person to be the mediator. If they do not:
•
the Court may select the mediator to be appointed or may appoint the mediator
pursuant to the Joint Protocol set out in this Practice Note; or
•
the Court may decide against ordering mediation.
Civil Procedure Act 2005 (NSW)
[4.280] Civil Procedure Act 2005 (NSW) ss 25–​34
Part 4 –​Mediation of proceedings
25 Definitions
(cf Act No 52 1970, ss 110I and 110J; Act No 9 1973, ss 163 and 164; Act No 11 1970, ss 21J and 21K)
In this Part:
mediation means a structured negotiation process in which the mediator, as a neutral and
independent party, assists the parties to a dispute to achieve their own resolution of the dispute.
mediation session means a meeting arranged for the mediation of a matter.
mediator means a person to whom the court has referred a matter for mediation.
26 Referral by court
(cf Act No 52 1970, s 110K; Act No 9 1973, s 164A; Act No 11 1970, s 21L)
(1)
If it considers the circumstances appropriate, the court may, by order, refer any proceedings
before it, or part of any such proceedings, for mediation by a mediator, and may do so either
with or without the consent of the parties to the proceedings concerned.
(2)
The mediation is to be undertaken by a mediator agreed to by the parties or appointed by the
court, who may (but need not be) a listed mediator.
(3)
In this section, “listed mediator” means a mediator appointed in accordance with a practice
note with respect to the nomination and appointment of persons to be mediators for the
purposes of this Part.
27 Duty of parties to participate
(cf Act No 52 1970, s 110L; Act No 9 1973, s 164B; Act No 11 1970, s 21M)
It is the duty of each party to proceedings that have been referred for mediation to participate, in
good faith, in the mediation.
28 Costs of mediation
(cf Act No 52 1970, s 110M; Act No 9 1973, s 164C; Act No 11 1970, s 21N)
The costs of mediation, including the costs payable to the mediator, are payable:
(a)
if the court makes an order as to the payment of those costs, by one or more of the parties in
such manner as the order may specify, or
(b)
in any other case, by the parties in such proportions as they may agree among themselves.
29 Agreements and arrangements arising from mediation sessions
(cf Act No 52 1970, s 110N; Act No 9 1973, s 164D; Act No 11 1970, s 21O)
(1)
The court may make orders to give effect to any agreement or arrangement arising out of a
mediation session.
[4.280]
217
Civil Procedure in New South Wales
Civil Procedure Act 2005 (NSW) cont.
(2)
On any application for an order under this section, any party may call evidence, including
evidence from the mediator and any other person engaged in the mediation, as to the fact
that an agreement or arrangement has been reached and as to the substance of the agreement
or arrangement.
(3)
This Part does not affect the enforceability of any other agreement or arrangement that may
be made, whether or not arising out of a mediation session, in relation to the matters the
subject of a mediation session.
30 Privilege
(cf Act No 52 1970, s 110P; Act No 9 1973, s 164F; Act No 11 1970, s 21Q)
(1)
In this section, “mediation session” includes any steps taken in the course of making
arrangements for the session or in the course of the follow-​up of a session.
(2)
The same privilege with respect to defamation as exists with respect to judicial proceedings
and a document produced in judicial proceedings exists with respect to:
(3)
(4)
(5)
(a)
a mediation session, or
(b)
a document or other material sent to or produced to a mediator, or sent to or produced
at the court or the registry of the court, for the purpose of enabling a mediation session
to be arranged.
The privilege conferred by subsection (2) extends only to a publication made:
(a)
at a mediation session, or
(b)
in a document or other material sent to or produced to a mediator, or sent to or
produced at the court or the registry of the court, for the purpose of enabling a
mediation session to be arranged, or
(c)
in circumstances referred to in section 31.
Subject to section 29(2):
(a)
evidence of anything said or of any admission made in a mediation session is not
admissible in any proceedings before any court or other body, and
(b)
a document prepared for the purposes of, or in the course of, or as a result of, a
mediation session, or any copy of such a document, is not admissible in evidence in
any proceedings before any court or other body.
Subsection (4) does not apply with respect to any evidence or document:
(a)
if the persons in attendance at, or identified during, the mediation session and, in the
case of a document, all persons specified in the document, consent to the admission
of the evidence or document, or
(b)
in proceedings commenced with respect to any act or omission in connection with
which a disclosure has been made as referred to in section 31(c).
31 Confidentiality
(cf Act No 52 1970, s 110Q; Act No 9 1973, s 164G; Act No 11 1970, s 21R)
A mediator may disclose information obtained in connection with the administration or execution
of this Part only in one or more of the following circumstances:
(a)
with the consent of the person from whom the information was obtained,
(b)
in connection with the administration or execution of this Part, including section 29(2),
(c)
if there are reasonable grounds to believe that the disclosure is necessary to prevent or
minimise the danger of injury to any person or damage to any property,
218
[4.280]
Alternatives to Litigation – Negotiation and Mediation
Chapter 4
Civil Procedure Act 2005 (NSW) cont.
(d)
if the disclosure is reasonably required for the purpose of referring any party or parties to a
mediation session to any person, agency, organisation or other body and the disclosure is
made with the consent of the parties to the mediation session for the purpose of aiding in the
resolution of a dispute between those parties or assisting the parties in any other manner,
(e)
in accordance with a requirement imposed by or under a law of the State (other than a
requirement imposed by a subpoena or other compulsory process) or the Commonwealth.
32 Directions by mediator
(cf SCR Part 72C, r 3)
Subject to the uniform rules and any relevant practice notes, a mediator may, by order, give
directions as to the preparation for, and conduct of, the mediation.
33 Protection from liability for mediator
A mediator to whom the court refers proceedings has, in the exercise of his or her functions as a
mediator in relation to those proceedings, the same protection and immunity as a judicial officer of
the court has in the exercise of his or her functions as a judicial officer.
34 Mediation otherwise than under this Part
(cf Act No 52 1970, s 110H (2); Act No 9 1973, s 162 (2))
This Part does not prevent:
(a)
the parties to proceedings from agreeing to and arranging for mediation of any matter
otherwise than as referred to in this Part, or
(b)
a matter arising in proceedings from being dealt with under the provisions of the Community
Justice Centres Act 1983.

Higgins v Higgins
[4.290] Higgins v Higgins [2002] NSWSC 455
[The plaintiff applied to the Supreme Court for an order for compulsory mediation. This was
opposed by the defendants.]
AUSTIN J
[1]‌These proceedings relate to a property at Camden in which the plaintiff has resided since
about 1982. The plaintiff is the mother of the first defendant and mother-​in-​law of the second
defendant. The property was acquired in the name of a company with which the defendants
were associated, although the plaintiff claims that she contributed to the purchase money. The
company which acquired the property went into liquidation about 1984 and then the defendants
took a transfer of the property from the company in liquidation. Subsequently, the property was
used to secure various advances, and the plaintiff says she became aware that the property had
been transferred into the defendants’ name in 1998 when a valuer attended the property, and
she then commenced the present proceedings. She is seeking declaratory and other relief to
establish that the property is held in a substantial portion in trust for her and that the defendants
acquired the property on notice of that trust. The defendants say the plaintiff by proxy approved
the sale and transfer of the property to them and they rely on laches and delay. They deny
that in the circumstances of the case the plaintiff has obtained any proprietary interest in the
property.
[4.290]
219
Civil Procedure in New South Wales
Higgins v Higgins cont.
[2]‌The plaintiff is aged 76 and in failing health. She has a serious heart condition and is developing
problems with her sight. The evidence before me today indicates that the plaintiff’s physical state has
become much worse over the past 12 months as a result of the strain and stress caused on her by the
proceedings. She only has two sons and she says the dispute has torn her family apart. She has not seen or
talked to the son who is the first defendant, or his wife, her daughter-​in-​law, for over three and a half years.
…
[4]‌Section 110K [now s 26 of the Civil Procedure Act] was introduced by amendments to the Supreme
Court Act which took effect in the year 2000. It gives the Court a discretion to refer proceedings for
mediation or neutral evaluation with or without the consent of the parties concerned. An annotation
to the section in Ritchie’s Supreme Court Procedure says that in the absence of an agreed mediation
regime, there probably would be relatively few occasions for the compulsory referral of proceedings
to mediation. However, referral may be appropriate where the Court is satisfied that the parties’
approach to the resolution of the proceedings is being unduly influenced by emotional or irrational
considerations, the effect of which might be minimised by a skilled mediator.
[5]‌It appears the approach to compulsory mediation has evolved since the powers were granted
in the year 2000. In Morrow v chinadotcom Corp [2001] NSWSC 209 (28 March 2001) Barrett J refused
to order a reluctant party to mediate on the basis that if mediation was not engaged upon willingly,
the process would be pointless and would likely be a waste of money. However, in Idoport Pty Ltd v
National Australia Bank Ltd [2001] NSWSC 427 (23 May 2001) Einstein J made orders for mediation
of massive litigation after the case had commenced, notwithstanding that the mediation process
would be long and expensive and the prospects for success were not high. In Remuneration Planning
Corporation Pty Ltd v Fitton [2001] NSWSC 1208 (14 December 2001) Hamilton J, in the course of
deciding what orders should be made for mediation, notwithstanding the opposition of one of the
parties to mediation in one of the matters before him, reviewed the other authorities and said:
A short time ago there was general acceptance of the view adopted by Barrett J … that
there was no point in a mediation engaged in by a reluctant party. Of course, there may be
situations where the Court will, in the exercise of its discretion, take the view that mediation
is pointless in a particular case because of the attitudes of the parties or other circumstances
and decline to order a mediation. However, since the power was conferred upon the Court,
there have been a number of instances in which mediations have succeeded, which have
been ordered over opposition, or consented to by the parties only where it is plain that the
Court will order the mediation in the absence of consent. It has become plain that there are
circumstances in which parties insist on taking the stance that they will not go to mediation,
perhaps from a fear that to show willingness to do so may appear a sign of weakness, yet
engage in successful mediation when mediation is ordered.
[6]‌In my view, all of the cases point to the single conclusion that the Court’s discretion under s 110K
is very wide and the Court should approach an application for an order without any predisposition,
so that all relevant circumstances going to the exercise of the discretion may properly be taken into
account.
[7]‌In the present case, it is relevant that the plaintiff is an elderly woman whose health is
deteriorating, partly because of the continuation of these proceedings. Her evidence is that she would
like to try to resolve the dispute before it goes to hearing, presumably so that the family may be
reconciled in her declining years.
[8]‌The desirability of making every reasonable effort to achieve that outcome is, to my mind,
obvious. The order would not be made, however, even given those circumstances, if I believed that
there was no plausible prospect of success in the process of mediation.
[9]‌ … I have no clear insight into how far the parties have gone in their own informal attempts to
reach a compromise. I have competing assertions about that matter and all I know is that the parties
have had discussions. One side says there is room for further discussion.
220
[4.290]
Alternatives to Litigation – Negotiation and Mediation
Chapter 4
Higgins v Higgins cont.
[10] In the circumstances, and on balance, my conclusion is that there is a sufficient possibility that
when faced with the prospect of mediation, both parties may approach the matter in the spirit of
compromise, that I ought to make an order giving the parties one last chance of avoiding the more
confrontational outcome that would result from a fully contested final hearing. I cannot conclude, in
other words, that mediation would be hopeless, or anything like hopeless on the state of the evidence
before me. I bear in mind the remarks of Hamilton J quoted above.
[11] When the application was heard this morning, I indicated to the parties that I needed to have
some further evidence with respect to the cost of mediation and the availability of an appropriate
mediator, so I adjourned the matter until this afternoon. Now, I have affidavit evidence which
indicates that the parties are available on 17 June and there is a mediator available on that day who is
prepared to conduct the mediation pro bono. It appears likely that the mediation will be over within
a day. The defendants have not submitted that the identified mediator would be an inappropriate
person. Indeed, there is evidence of a substantial number of other mediators identified by Leadr,
and in respect of none of them has it been contended that the person would be an inappropriate
mediator. I am therefore satisfied that a mediator can be found and that a mediation can take place at
a very moderate cost by no later than 17 June 2002. I shall frame my orders so that if the parties can
arrange for a mediator at an earlier time suitable to all of them, the mediation can take place sooner
rather than later.
[12] In the event that mediation is successful, further costs will be minimised. On balance, therefore,
it seems to me that the proper way to exercise my discretion in the special circumstances before me
now is to make an order for mediation.
[13] I should say that other submissions were put to me which, in the circumstances, I regard as
rather less weighty. There was some argument about whether there were delays in bringing the case
to trial, and whether the plaintiff was responsible for some or all of those delays. It seems to me even
if she was, the order should still be made.
[14] It was also contended that the plaintiff initiated the present proceedings without warning
and that negotiations should have happened much earlier than the present time. That may be so,
but in a sense, that it is beside the point. The real point is whether anything constructive is be
done now to avoid a contested hearing of a kind that would irretrievably drive a wedge deeper into
the relationships within this unhappy family. I accept that the Idoport and Remuneration cases are
distinguishable on their facts. I have cited them for the general principles to which I have referred. The
basis of my decision is the exercise of my discretion on the facts of this case.
…
Order that the proceedings be referred for mediation.

Waterhouse v Perkins
[4.300] Waterhouse v Perkins [2001] NSWSC 13
[The plaintiff commenced two defamation actions in respect of the publication of the book The
Gambling Man. The first claim was filed in 1991 and the second claim was filed in 1996. The plaintiff
refused the defendants’ request for mediation. The defendants sought an order for compulsory
mediation.]
LEVINE J
[80] By letter dated 21 August 2000 Messrs Bush Burke & Co. wrote on behalf of all defendants in
both matters expressing strongly the view that the matter should be mediated so as to “see if they can
be resolved without the expenditure of large sums of money on legal fees and the tying up of large
[4.300]
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Civil Procedure in New South Wales
Waterhouse v Perkins cont.
amounts of valuable court time”. An estimate of the length of the hearing in this Court (and it would
be an all issues jury trial –​save for public interest and privilege) is at least six weeks.
[81] It was indicated by Messrs Bush Burke that the defendants had agreed to utilise the services of
Sir Laurence Street and certain available dates were offered. It was the defendants’ expectation that
the mediation would last one day.
[82] Significantly the defendants have agreed to pay for all the mediator’s costs associated with the
mediation: by that I understand from oral submissions that the mediator’s fees and the costs of the
venue would be paid by the defendants pursuant to an arrangement among the defendants and that
all the plaintiff would incur by way of costs is his own legal costs in respect of the mediation.
[83] Essentially it was argued in support of the application that by reason of the complexities of the
issues between the parties (and there are cross-​claims), the length of time taken since the initiation
of proceedings (1991 –​the first action), what would be the length of time to be taken and the
inestimable amount of costs to be incurred in a fully litigated jury trial are factors which at least point
to the desirability of the exploration of the resolution of the issues between the parties otherwise than
by the trial itself.
…
[87] However, the Court does have the power imposed by s 110K [now s 26 of the CPA] to order
mediation without the consent of the parties to the proceedings.
[88] An important component of this new part of the Supreme Court Act is s 110L [now s 27 of the
CPA] which provides that it is the duty of each party to the proceedings the subject of a referral under
s 110K to participate, in good faith, in a mediation or neutral evaluation.
…
[90] The plaintiff’s response to the defendants’ application has been entirely negative. The highest
expression of this approach was in this statement made by Mr Campbell of counsel for the plaintiff:
There is also the question of a choice of mediator. The plaintiff, for reasons which may or
may not be justified, would rather die than accept a mediator selected and forced on him by
the defendants and it wouldn’t matter if it was the Archangel Gabrielle. They are not offering
his services. (T55.20)
[91] More seriously, however, the plaintiff does point to a fundamental ingredient in a defamation
action, that component of the ultimate remedy that constitutes vindication of the plaintiff in the
eyes of the public. It is argued simply that mediation cannot achieve this. I do not know how that
proposition seriously can be advanced. It is at least theoretically possible that the outcome of a
mediation conducted in good faith by all parties could be a mechanism for the public vindication of
the plaintiff. It might not necessarily be so, but to say that it is impossible is quite ingenuous.
[92] Litigation of an action of this kind in this Court is one that leads to the determination of
what might be described as “rights”. Mediation is not conducted to the exclusion of “rights”. The
mediation might be directed to consideration of “interests and needs” independently of or against the
backdrop of “rights” as exposed in the forensic environment.
[93] Mediation might well have the advantage of taking the edge off the acrimony as evidenced,
for example, by the statement made by Mr Campbell.
[94] In any event, the plaintiff is an officer of this Court and if compulsorily ordered to participate
he should do so as an officer of this Court fully conscious of the obligations of good faith.
[95] Mr Campbell seemed to be preoccupied with what sanction would apply in the event of a
party not acting in good faith under s 110L. That remains to be determined. Insofar as that obligation
arises consequent upon the making of an order of the Court, it is feasible that one sanction might well
be contempt. But I give that no further consideration, at present.
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Chapter 4
Waterhouse v Perkins cont.
[96] Thus it appears that the considerations relevant to the application in this litigation can be
summarised as follows: a great deal of time has passed since the institution of each action (1991
and 1996). As at mid-​2000 the parties were still engaged in the usual interlocutory squabbles there
being little chance, upon the resolution of them, and assuming no further interlocutory disputes (an
unsafe assumption in the general course of this litigation), of the matter being heard before the end
of 2001. On present estimates that hearing will take at least six weeks and be constituted by the two
actions being heard together by one jury. The defendants are clearly concerned about costs and
thus it may fairly be said “their financial interests”. The plaintiff is clearly concerned with vindication.
As I have mentioned above I reject the statement, as too simplistic, that a mediator cannot give
vindication. I note in this context that the defendant McPherson’s have thrice published an apology
in metropolitan newspapers. The fact of one defendant having so apologised, as Mr Caspersonn
remarked, may lead to “something” in the mediation process.
[97] Further, the only costs in financial terms to the plaintiff will be his own legal costs. That
expenditure by him, together with that of the defendants, cannot reasonably be considered a
disproportionate diversion of resources (even if the mediation fails) when viewed against the
quantification of resources in all their aspects in the further prosecution of this litigation to trial and
verdict.
[98] It is the law constituted by the will of the Parliament reflected in Pt 7B of the Supreme Court
Act and the orders made by this Court itself that the parties are obliged to act in good faith. If they do
so, and it is to be presumed that they will, the potential outcomes must be viewed positively when
weighed against the dimensions and cost of a trial. I am not persuaded that there is any rational
reason for not ordering mediation in the peculiar circumstances of this litigation at this time. The
issues are clear as between the parties, if not as refined as parties in defamation actions seem to insist
upon, by reason of outstanding interlocutory disputes.
[99] With respect to the various matters dealt with in the body of this judgment I will defer making
formal orders so that the resources of the parties both in terms of time and costs can the more easily
be allocated to the mediation process.
[100] As I consider the circumstances appropriate I order that the whole of the proceedings in
matter number 13146 of 1991 and 21381 of 1996 be referred for mediation.

Good faith
The Right Balance between Trial and Mediation: Visions,
Experiences and Proposals
[4.304] The Hon Justice PA Bergin, The Right Balance between Trial and Mediation: Visions, Experiences
and Proposals, Aula Magna, Court of Cassation, Rome, 19 October 2012 [some footnotes omitted]
A statutory duty to mediate in good faith
30 One attempt at formal regulation of the mediation process can be found in the statutory
requirement to mediate in good faith. For instance the CPA provides that parties who have been
referred to mediation by the Supreme Court are under a duty to participate in the mediation in good
faith. A similar duty also exists under other statutes [Farm Debt Mediation Act 1995 (NSW), s 11(1)(c)
(iii); Native Title Act 1993 (Cth), ss 31(1)(b) and 94E(5)].
[4.304]
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Civil Procedure in New South Wales
The Right Balance between Trial and Mediation: Visions, Experiences and Proposals cont.
31 Beyond some inherent difficulties in defining good faith and identifying when a party is not
acting in good faith, the cloak of confidentiality might often protect a party who fails to mediate in
good faith. This presents a complex problem for mediation regulation. In order to give substance
to the duty to mediate in good faith, it is necessary to permit disclosure of information in certain
circumstances. However this will be at the cost of the inherently confidential nature of mediation.
Without confidentiality, the effectiveness of mediation, and its desirability as a method of dispute
resolution, is greatly reduced. This dilemma arises whenever the authority of the court is called on to
enforce or otherwise scrutinise the outcomes of a mediation. [See for example Hurworth Nominees Pty
Ltd v ANZ Banking Group Ltd [2006] NSWSC 1278].
32 In the analogous setting of negotiation, certain indicia have been identified to assist in
determining whether a party has negotiated in good faith. [Western Australia v Taylor (1996) 134 FLR
211 at 224-​5]. Several of these indicia related to inaction or omissions, for instance, a failure to make
proposals, contact parties, organise meetings or respond to information requests. Others involve
more active steps, such as negotiators not having authority to make decisions. The final indicium,
“failure to do what a reasonable person would do in the circumstances”, seems to impose a general
standard on a negotiator’s conduct. The application of these indicia to mediation suggests that a
party would not be acting in good faith if their conduct stymies, stalls or otherwise fails to progress
the mediation process.
33 The “central or core content” of the obligation to mediate in “good faith” has been
described as:
(a)
A willingness to consider such options for the resolution of the dispute as may be propounded
by the opposing party or by the mediator, as appropriate; and
(b)
A willingness to give consideration to putting forward options for the resolution of the dispute.
[Aiton Australia Pty Ltd v Transfield Pty Ltd [1999] NSWSC 996; 153 FLR 236 at 268].
34 The fact that a party might pretend to be disinterested in putting forward any constructive solutions
to the problem at hand “is far from conclusive proof” that the party has breached the obligation. This
is because:
At the same time as putting up such pretence, [the party] might be awaiting a first offer from
[the other party] or giving close consideration to itself making an offer at what it perceives to
be an appropriate time. [Aiton Australia Pty Ltd v Transfield Pty Ltd [1999] NSWSC 996; 153
FLR 236 at 269].
35 These observations expose the inherent difficulties in identifying and enforcing a duty to act in
good faith in the confidential setting of mediation.
Law Council of Australia Guidelines
[The Law Council of Australia has produced publications entitled: “Ethical Guidelines for Mediators”,
“Guidelines for Lawyers in Mediations” and “Guidelines for Parties in Mediations”].
…
38 The Guidelines also provide that “all persons attending the mediation should participate
in good faith with the intention of seeking settlement” and that a mediator may terminate the
mediation if the mediator considers that a party is abusing the process. The mediator may be
assisted in this regard by the parties’ legal representatives. The Guidelines advise that a lawyer
who suspects that a party is acting in bad faith should raise the matter privately with the mediator.
This form of mediator-​
led regulation likely reflects common practice. Mediators are responsible
for the conduct of mediation and so, in effect, are under a duty to facilitate participation in
good faith.

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Chapter 4
The ripeness of a dispute for mediation
[4.306] An important consideration in undertaking mediation or for a judge in ordering
mediation is determining when is the ripe or appropriate time to utilise mediation. The Law
Council of Australia’s Guidelines for Lawyers in Mediation (August 2011) states:
Timing is an important factor in establishing a framework conducive to settlement. There is no
conclusive rule as to whether, or when, a case is suitable for mediation. Various factors should
be considered, including the nature of the dispute and the mindsets of the parties.
Comment
(a) Most cases are suitable for mediation at some point in time. Costs of litigation are a
persuasive factor in favour of mediation.
(b) Mediation may be undertaken at any time and should be considered:
(i) before proceedings are commenced;
(ii) after pleadings have closed, but before the costs of discovery are incurred;
(iii) before an action is set down for trial and trial costs are incurred; and
(iv) after a trial and before judgment.
Oasis Fund Management v ABN Amro
[4.310] Oasis Fund Management v ABN Amro [2009] NSWSC 967
MCDOUGALL J
[1]‌The plaintiffs seek an order pursuant to s 26 of the Civil Procedure Act 2005 that these proceedings
be referred to mediation. The first defendant opposes mediation at this time. The second defendant
neither consents to nor opposes mediation at this time. Likewise, those of the cross-​defendants who
are not otherwise parties neither consent to nor oppose mediation at this time.
[2]‌The plaintiff seeks early mediation for a number of reasons. One is that, if there is no early or
successful mediation, the costs of giving discovery and of putting on evidence will be high, and will
of themselves be an obstacle to successful mediation at a later time. Another reason is that those who
stand to benefit by success in the proceedings, and therefore by a fruitful mediation, are investors
many of whom are old, many of whom relied on the investments in question to fund their retirement,
and some of whom are suffering from financial distress because of the difficulties with the investment
in question.
[3]‌The first defendant opposes mediation at the present time for three reasons. One is that, absent
discovery and evidence, it cannot make a realistic assessment of the strength and weaknesses of the
case against it and its defence to that case. Another, perhaps somewhat inconsistent reason, is that
even with no formal mediation, the parties could in any event engage in informal negotiations. The
third, which in my view goes no further than the first, is that its “considered preference to continue
the proceeding”, is of itself a factor to take into account. The quotation comes, and the submission is
based upon, the judgment of Brereton J in Dimento v Dimento [2007] NSWSC 420 at [1].
[4]‌It is necessary to know a little about the case. The first plaintiff is the current trustee, and the
second plaintiff was the trustee, of two trusts. Those trusts were in effect master trusts which offered
a smorgasbord of superannuation products to members of the public. Two of the products that were
offered were known by the engaging but entirely misleading title of “Safety PINS”. The plaintiff says
that the information memorandum and other documentation prepared in relation to the two series of
Safety PINS in question (issued in 2003 and 2004) were misleading or deceptive. They say that, had
those documents disclosed accurately the weaknesses and other relevant aspects of the products, they
would not have been listed among the products available to investors through the plaintiffs’ platform.
[5]‌For reasons that I have to confess I do not entirely understand there are also two individual
plaintiffs. One was an investor in the 2003 Safety PINS. The other was an investor in the 2004 Safety
[4.310]
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Civil Procedure in New South Wales
Oasis Fund Management v ABN Amro cont.
PINS. They sue in their own capacities and claim also to sue as representatives of other investors who
invested in the relevant Safety Pins through the plaintiffs’ platform.
[6]‌Mr M J Darke of counsel, for the first defendant, has said that it is no part of his client’s case
that if (contrary to his client’s case) there were misleading or deceptive conduct for which his client is
liable or in which his client was involved, and if loss of damage were sustained by that misleading or
deceptive conduct, the loss or damage was sustained in law by individual investors rather than by the
relevant plaintiff as trustee. As I understand it, the first defendant accepts that if the hurdles to which
I have referred are jumped, then the trustee is entitled to recover, on behalf of the trusts and for the
recoupment of individual investors, such loss or damage as is proved.
[7]‌As I have said, I am not entirely sure why there are individual plaintiffs, let alone why they seek
to sue in a representative capacity.
[8]‌The amounts of money at stake are large: of the order of $60 million for the 2003 Safety
PINS, and over a million dollars for the 2004 Safety PINS (in each case inclusive of interest). In
addition, the plaintiffs claim some amount of expenses (not yet particularised) which they say that
they incurred in respect of the promoter of the Safety PINS, a company now in liquidation known
by the acronym ACIL.
[9]‌It is always difficult to pick, and in my view never possible to state a priori, the ideal time for
mediation. In some cases, where the issues are clear and where the parties’ positions can be ascertained
without a great deal of difficulty, early mediation is often a good idea because the parties have not
spent vast amounts on costs and their positions have not become psychologically entrenched. In
other cases, notwithstanding those possible obstacles, early mediation is not really useful because the
parties simply do not know enough to make a considered choice as to where they are prepared to go
in terms of mediated settlement.
[10] Another factor of some significance is that although the second defendant (who is said to
have been involved in the preparation of the information memoranda that are said to be misleading
or deceptive) has the benefit of insurance, that insurance has a fixed limit of indemnity and that limit
of indemnity applies to “loss” which, for the purposes of the policy, is defined to include defence
costs. It follows, as between the plaintiffs and the second defendant, that the later mediation takes
place, the less there will be available from the policy to apply towards an offer of settlement of the
plaintiffs’ claim.
[11] As I have said, I think that the principal issue is whether there is enough information at present
for the parties to make a realistic assessment of their respective positions, so as to mediate not only in
good faith but successfully. Of course, I accept that if an order is made –​even over the objections of
the first defendant –​it will participate in good faith, mindful of its obligations under s 56 of the Civil
Procedure Act.
[12] I say that this is the principal issue because it seems to me that the “considered preference” to
which respect must be given is a considered preference based entirely on that consideration.
[13] The causation case that is alleged is that the trustee put the products on its platform and
that, but for the misleading or deceptive conduct, it would not have done so. Alternatively, it is said,
had it been told the real situation after the products had been put on their platform, it would have
removed the products. Thus, it is said, the individual investors would not have been able to invest in
the products –​at least, through the trustee.
[14] The causation case for the individual plaintiffs is in effect that they relied on the information
memorandum through their “agent”, some form of financial adviser who apparently steered them
towards the products in question. Alternatively, they rely on some sort of indirect causation case: but
for the misleading or deceptive conduct, they would not have invested because there would have
been no opportunity; the trustee would not have offered the products.
[15] The first way in which the individual investors put their case, and the way that the trustees put
their case, seems to me to be relatively straightforward. However, the second way that the individual
226
[4.310]
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Chapter 4
Oasis Fund Management v ABN Amro cont.
plaintiffs put their case seems to me to involve both legal difficulties and some prospect that there will
be significant evidence, from individual to individual, dealing with the question of causation.
[16] Having said that, the first defendant’s position in relation to causation or loss, as I have outlined
it above, suggests that this is more of a legal than a practical impediment to successful mediation.
[17] Of more concern is the first defendant’s submission, based on the list response of the second
defendant, that the trustee was involved in the development of the product –​that is to say, the
2003 and 2004 Safety PINS. The first defendant says that it is impossible to assess the case based on
misleading or deceptive conduct until it knows the full extent of the trustee’s involvement. It is not
however part of the first defendant’s case that the trustee was involved in the development of the
relevant information memorandum or other documents said to be misleading or deceptive.
[18] If that issue is to be understood before the matter goes to mediation, it means of necessity
that mediation would not take place until after the evidence is complete and, I would think, until after
discovery has been given.
[19] In any event, Mr Darke submits, the position of the individual investors cuts both ways.
He submits that their age and financial circumstances in fact dictate that the preparation of the
proceedings should not be held up by a mediation that is unlikely to succeed.
[20] As I have said, it is always a difficult exercise to fix the ideal time for mediation, and this case
fully exemplifies the extent of that difficulty. It is necessary to take into account the circumstance
that one of the parties is of the view that it needs to know more before it can consider whether to
participate and if so how to formulate its negotiating position. I accept that what has been put as
to the first defendant’s position is put in good faith (and I note that no submission was made to the
contrary). Thus, I accept that the concern that the first defendant has expressed through Mr Darke is
of itself a matter that bears on the desirability of mediation at this stage.
[21] Nonetheless, I think, in the hands of a skilled mediator, it may be possible for that difficulty to
be overcome. I think it possible that through appropriate position statements and other steps (which
the mediator can direct) the first defendant may be given a sufficient understanding of the case that
it has to meet to enable it to formulate a considered position on settlement.
[22] This is a matter of conjecture. The real question is whether to risk the costs of mediation, and
the delay that will necessarily be entailed, upon the basis of the conjecture. In this context, I think, the
age and personal situations of the individual investors assumes very considerable importance. Whilst
I accept the principle behind Mr Darke’s submission that this cuts both ways, I think that the reality is
that a mediation in the near future –​and it seems that the preferred date is at the end of this month –​
is unlikely to cause such significant delay that, if the mediation is unsuccessful, any receipt of fruits
through success in litigation will be unduly postponed.
[23] I also think that the impediment of costs, and the obstacle of what I have called psychological
entrenchment, are likely to become more significant as this case proceeds if there is no early mediation;
and of course, in relation to the second defendant, costs are a particular obstacle.
[24] Balancing all those considerations, and acknowledging that the decision is not one capable
of detailed and rational explanation, I have come to the view that the prospects of success of early
mediation sufficiently outweigh the acknowledged disadvantages of it to justify the making of an
order notwithstanding the considered position of the first defendant.
[25] Accordingly, I think it appropriate to make an order in terms of s 26 of the Civil Procedure Act. It
appears that there is a mediator who is acceptable to the parties, and who can conduct the mediation
within a time that is suitable to them all. One of the matters to be attended to before the mediation
is that the plaintiffs should give adequate particulars of the expenses to which I have referred above.
I have assumed that this can be accommodated before the mediation takes place.
[26] In those circumstances, I think, having expressed the view that I will order mediation, the
appropriate course is to stand the matter down so that the parties can prepare short minutes of order
[4.310]
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Civil Procedure in New South Wales
Oasis Fund Management v ABN Amro cont.
to give effect to the steps that will need to be taken to enable the mediation to proceed before the
Honourable Roger Gyles AO QC on 29 and if necessary 30 September 2009.
[27] It will also be necessary to deal with the question of costs. Although there has been an
application over opposition and the application has been successful, my strong, although tentative
view, is that there should be no order as to costs at this stage. I say that because I think that to make
an order for costs now is unlikely to improve the frame of mind for mediation.

Tony Hassan Noun v Margaret Pavey
[4.320] Tony Hassan Noun v Margaret Pavey [2014] NSWSC 429
DARKE J
[The plaintiffs, Mr Noun and THN Pty Ltd, seek final injunctive relief against three defendants
to restrain alleged breaches of confidence. The plaintiffs have served their evidence-​in-​chief and
the defendants have served evidence in response. The plaintiffs have served their evidence in reply,
except for evidence from the first plaintiff. Discovery had not occurred consistent with Practice Note
SC Eq 11.]
[32] The defendants also seek an order that the proceedings be referred to mediation once the
totality of the plaintiffs’ evidence in reply has been served. This order is opposed by the plaintiffs.
Mr Lawrance [of counsel] accepted that compelling mediation in such circumstances is unusual,
although less so than it was once. He pointed out that the parties had late last year agreed to mediate
once the evidence in reply was completed and served, and that the Court had noted such agreement.
He stated further that the parties had agreed on a mediator, namely Mr Michael McHugh, AC QC, a
former Justice of the High Court of Australia.
[33] Mr Lawrance submitted that the mediation ought to take place prior to any discovery
application which may be made by the plaintiffs which, he submitted, would likely be an exercise
involving considerable expense.
[34] He further stated that the proceedings do not involve any claim for monetary relief but are
confined to applications for final injunctive relief, and in that context noted that the defendants,
by paragraph 58 of their defence, have made open offers which include undertakings in relation
to certain confidential information. It was submitted that this, in itself, provides some hope of an
agreement being reached at a mediation. Mr Lawrance also noted, in relation to the plaintiffs’ claim
for specific performance of what is described as Mr Noun’s resignation agreement, that the agreement
concerned the affairs of MS Cognosis Pty Ltd, a company which was wound up on 15 July 2013. It
was submitted that specific performance was thus no longer possible. Finally, Mr Lawrance stated that
the only monetary relief being sought in the proceedings was by way of the cross-​claim filed by the
second defendants, which was a claim for damages which did not exceed $50,000.
[35] Mr Bevan, in his submissions on this question, put that the plaintiff wanted to know exactly
what the defendants’ case against it was before attending any mediation. He submitted that whilst
the plaintiffs were keen to resolve the matter, they should not be forced to mediate at this stage
because of a likelihood that the defendants, in advance of any discovery being given, will assert that
the plaintiffs simply have no case against the first and second defendants. Mr Bevan emphasised that
a mediation should really be viewed (as he put it) as “one shot in the locker” and that the opportunity
to mediate should not be taken at this point because the prospects of its success are much less than
it would be if the plaintiffs had full information, including discovery and documents produced on
subpoena, in relation to the defendants and their conduct.
228
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Chapter 4
Tony Hassan Noun v Margaret Pavey cont.
[36] The Court has a broad discretion concerning the making of orders for the parties to mediate.
Plainly enough, the overriding purpose referred to in section 56 of the Civil Procedure Act 2005 (NSW)
is a matter of significance in the exercise of that discretion. The parties have, no doubt, already
expended vast sums of money on this litigation which, whilst clearly being of importance to the
parties and whilst clearly raising significant issues, does not involve significant amounts of money.
An exercise involving the obtaining orders for discovery, and then taking steps on the basis of the
discovery (which has been foreshadowed would likely involve an examination of computers, quite
apart from a great number of documents) is likely to be very expensive indeed.
[37] I can understand the plaintiffs’ position in wanting to have full information available to it
before embarking upon a mediation. However, I consider that once the affidavit evidence has been
completed, that is, once all of the plaintiffs’ evidence in reply has been served, the parties will know
the nature of the cases that each wishes to bring in the proceedings sufficiently to enable sensible
discussion concerning the resolution of the litigation.
[38] Moreover, if a mediation is held, the defendants will have obligations to mediate in good faith,
just as the plaintiffs will. The scope, therefore, for the defendants to simply take a position that there
is no evidence supporting a case against the first and second plaintiffs is one which is unlikely to be
able to be maintained in circumstances where the plaintiffs can respond by asserting that orders for
discovery in that respect are going to be sought if no settlement is reached.
[39] Whilst the matter is somewhat finely balanced in my opinion, I have come to the conclusion,
having regard to all of the above factors and the desirability of the parties attempting to resolve this
matter before any further substantial legal costs are incurred, that it is appropriate for the parties to
attend a mediation as soon as the evidence in reply has been served. The Court will make an order
to that effect.

The Objectives, Scope and Focus of Mediation Legislation
in Australia
[4.330] The Hon Justice PA Bergin, The Objectives, Scope and Focus of Mediation Legislation in Australia
(Paper presented at the “Mediate First” Conference, Hong Kong International Arbitration Centre
and The Hong Kong Mediation Council, Hong Kong Convention and Exhibition Centre, 11 May
2012) [footnotes omitted]
32 In 2007, I attempted to shed some light on the issue [of ripeness] by examining a limited
sample of cases in the Equity Division of the Supreme Court of New South Wales. More specifically,
I considered 98 cases from the Commercial List and the Technology & Construction List (the Lists)
that had been referred to mediation in the period 1 January 2006 to 1 June 2007.
33 The cases in the sample were divided into three categories, depending on the stage in the
litigious process at which they had been referred to mediation:
• the preliminary stage –​in which the parties are finalising their pleadings;
• the intermediate stage –​during which discovery and other interlocutory steps occur; and
• the advanced stage –​when parties are preparing their evidence and the trial date has been set.
34 The data revealed that cases referred to mediation at a late stage in proceedings were more
likely to settle. Of the 30 matters referred to mediation at an advanced stage, 18 (60%) settled. This
compared to a settlement rate of 27% and 29% for matters referred to mediation at a preliminary
stage and intermediate stage respectively. The overall settlement rate for the cases considered in the
study was 38%.
[4.330]
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Civil Procedure in New South Wales
The Objectives, Scope and Focus of Mediation Legislation in Australia cont.
35 New data has been collated from 99 cases referred to mediation from the Lists between
1 January 2008 and 31 December 2011. These cases were again categorised according to the three
stages specified above. Significantly, the new data is consistent with the earlier finding that cases
referred to mediation at an advanced stage are more likely to settle, although the difference between
the settlement rates across the various stages was less marked in the new sample.
36 Occasionally, a matter was referred to mediation at multiple stages. There was a total of 104
referrals across the 99 cases. Where a matter was referred to mediation twice and a settlement was
subsequently reached, the first referral was recorded as unsuccessful, while the later referral was
recorded as successful. Where a matter was referred to mediation unsuccessfully on multiple occasions,
all referrals were recorded as unsuccessful.
37 The overall settlement rate for the 99 cases was 46%, which was slightly higher compared to
the earlier research (38%). Of the 46 matters that settled at mediation:
• 16 (35%) were referred at a preliminary stage;
• 14 (30%) were referred at an intermediate stage; and
• 16 (35%) were referred at an advanced stage.
38 Of the 104 referrals to mediation:
• 38 were referred at a preliminary stage and 16 (42%) settled;
• 31 were referred at an intermediate stage and 14 (45%) settled; and
• 35 were referred at an advanced stage and 16 (46%) settled.
39 In respect of those referrals to mediation that did not result in settlement (58):
• 22 (38%) had been referred at a preliminary stage;
• 17 (29%) had been referred at an intermediate stage; and
• 19 (33%) had been referred an advanced stage.
40 Of the cases that did not settle at mediation, the majority (53%) went to trial or were proceeding
to trial at the time the data was collected, while 15% settled within six months of mediation and 32%
settled more than six months after mediation.
41 The recent study also provided some further detail that was not available in the 2007 evidence.
In nine cases the parties attempted to mediate the dispute before commencing proceedings. Each
of these cases were subsequently referred to mediation during the course of proceedings, and the
settlement rate among this group was generally in line with the overall settlement rate (four settled
while five failed to settle).
42 Where the parties expressed concerns about the appropriateness of mediation at the
commencement of litigation, subsequent mediation outcomes were much less successful. There
were eight cases in which the parties were completely unwilling to mediate and five cases in which
willingness was conditional (either upon the completion of a certain stage in the interlocutory process
or the determination of a threshold question of law). Only one case in each group subsequently
settled at mediation, which represents a significantly lower settlement rate compared to all cases.
43 As I said in 2007, “the drawing of inferences and conclusions from raw statistics is never
satisfactory and in an area such as this, where mediations are conducted in private with confidentiality
regimes, the conclusions and inferences are bedevilled by even more uncertainty”. However, although
less pronounced, the new data is consistent with the observations I made in 2007.
44 Even if the data were unable to support a clear inference that the ripe time to refer a matter to
mediation is at an advanced stage, it nonetheless suggests that mediation is at least as effective at a later
stage in proceedings as it is at the earlier stages. An equally available conclusion is that the ideal time to
mediate varies from case to case; in other words, there is no universal ripe time to mediate civil disputes.

230
[4.330]
Alternatives to Litigation – Negotiation and Mediation
Chapter 4
ENFORCEABILITY OF AGREEMENTS TO USE ADR
[4.340] There is no legislative basis for enforcing dispute resolution clauses otherwise than
those which provide for arbitration: Commercial Arbitration Act 2010 (NSW). However, it
is clear that if parties have entered into an agreement to conciliate or mediate their dispute,
the Court may, in principle, make orders achieving the enforcement of that agreement as
a precondition to commencement of proceedings in relation to the dispute: Hooper Bailie
Associated Ltd v Natcan Group Pty Ltd (1992) 28 NSWLR 194 and Aiton v Transfield [1999]
NSWSC 996. Construction of dispute resolution clauses is by reference to a liberal approach
as expressed in Lipman Pty Ltd v Emergency Services Superannuation Board [2011] NSWCA
163 and Francis Travel Marketing Pty Ltd v Virgin Atlantic Airways Ltd (1996) 39 NSWLR
160. Nonetheless, the enforceability of dispute resolution clauses is ultimately a matter of
contractual construction. This has often meant determining whether agreements to negotiate
in good faith were enforceable or void for uncertainty.
United Group Rail Services v Rail Corporation NSW
[4.350] United Group Rail Services Ltd v Rail Corporation NSW [2009] NSWCA 177
ALLSOP P (WITH WHOM IPP JA AND MACFARLANE JA AGREED)
[1]‌This appeal concerns the content and operation of a clause dealing with dispute resolution in
the General Conditions of Contract of two contracts between Rail Corporation New South Wales,
formerly the State Rail Authority of New South Wales (“Railcorp”) and United Rail Group Services
Limited, formerly known as A. Goninan & Co Limited (“United”) under which United undertook to
design and build new rolling stock for Railcorp. The relevant provisions are identical and reference
need only be made to one group of provisions.
[2]‌The dispute resolution clause, cl 35, is long and detailed, reflecting the parties’ careful attention
to the subject. The clause commenced with a broadly expressed provision (cl 35.1) dealing with the
scope of the clause, as follows:
[35.1] Notice of Dispute
If a dispute or difference arises between the Contractor and the Principal or between the
Contractor and the Principal’s Representative in respect of any fact, matter or thing arising
out of or in connection with the work under the Contract or the Contract, or either party’s
conduct before the Contract, the dispute or difference must be determined in accordance
with the procedure in this Clause 35.
Where such a dispute or difference arises, either party may give a notice in writing to the
Principal’s Representative and the other party specifying:
(a) the dispute or difference;
(b) particulars of the dispute or difference; and
(c) the position which the party believes is correct.
[3]‌That clause is to be read liberally as required by the common law of Australia: Francis Travel
Marketing Pty Ltd v Virgin Atlantic Airways Ltd (1996) 39 NSWLR 160 at 165-​166 (Gleeson CJ with
whom Meagher JA and Sheller JA agreed) and Comandate Marine Corporation v Pan Australia Shipping
Pty Ltd [2006] FCAFC 192; 157 FCR 45 at 87-​93 [162] -​[187] (Allsop J with whom Finn J and
Finkelstein J agreed). See also the law of international commerce: Fiona Trust & Holding Corporation
v Privalov [2007] UKHL 40; [2008] 1 Lloyd’s Rep 254 (see [31] for the phrase “law of international
commerce”) and Threlkeld & Co Inc v Metallgesellschaft Limited (London) [1991] USCA2 61; 923 F 2d
245 (2nd Cir. 1991). So reading the clause, it can be seen to require the totality of likely disputes
between the parties to be dealt with by the clause. No evidence is needed to appreciate that an
engineering contract for the designing and building of new rolling stock for Railcorp could lead to
[4.350]
231
Civil Procedure in New South Wales
United Group Rail Services v Rail Corporation NSW cont.
complex disputes, which, if litigated, could be productive of very large legal and associated forensic
costs. As I said in Comandate at 95 [192]:
An ordered efficient dispute resolution mechanism leading to an enforceable award or
judgment by the adjudicator, is an essential underpinning of commerce. Disputes arising
from commercial bargains are unavoidable. They are part of the activity of commerce itself.
Parties therefore often deal with the possibility of their occurrence in advance by the terms
of their bargain.
[4]‌In cl 35.2 to 35.9, the contract provided for expert determination of certain kinds of dispute.
Clause 35.2 provided as follows:
[35.2] Submission to Expert Determination
If the dispute or difference is in relation to a Direction of the Principal’s Representative
under one of the Clauses referred to in Attachment “A”, the dispute or difference must, if it is
not resolved within 14 days after a notice is given under Clause 35.1, be submitted to expert
determination to be concluded by:
(a) the independent industry expert specified in Attachment “A”; or
(b) where:
(i) no such person is specified; or
(ii) the independent industry expert specified in Attachment “A” or person appointed
under this Clause 35.2:
(A) is unavailable;
(B) declines to act;
(C) does not respond within 14 days to a request by one or both parties for advice
as to whether he or she is able to conduct the appraisal; or
(D) does not issue his or her decision within the time required by Clause 35.7,
a person agreed between the Principal and the Contractor and failing agreement within
21 days then a person appointed by the President for the time being of the Institution of
Engineers, Australia.
[5]‌For present purposes, it is unnecessary to dwell on the details of Attachment A, including the types
of dispute to be dealt with by experts and the identity of the experts.
[6]‌Clause 35.3 made clear that the expert was not an arbitrator and could reach a decision from
his or her own knowledge and experience.
[7]‌Clause 35.4 provided for the procedure of the expert determination by the adjudicator.
[8]‌Clause 35.5 provided for disclosure of interests of the adjudicator.
[9]‌Clause 35.6 provided for each party to bear its own costs of the expert determination.
[10] Clause 35.7 provided for a determination by the adjudicator within 28 days of acceptance by
him or her of the appointment, unless the parties otherwise agreed.
[11] Clause 35.8 provided for the terms of an adjudication agreement between the parties and the
adjudicator.
[12] Clause 35.9 dealt with the determination in the following terms:
[35.9] Determination
The determination:
(a) must be given in writing by the Adjudicator;
(b) will be final and binding unless a party gives notice of appeal to the other party within
7 days of the determination; and
232
[4.350]
Alternatives to Litigation – Negotiation and Mediation
Chapter 4
United Group Rail Services v Rail Corporation NSW cont.
(c) is to be given effect to by the parties unless and until it is reversed, overturned or
otherwise changed under the procedure in the following Clauses 35.10 to 35.12.
[13] Clause 35.10 provided that if a notice of appeal is given under subcl 35.9(b) or if the dispute
is of a kind that is not required by cl 35.2 to be sent to expert determination:
[T]‌
he dispute or difference must be determined by arbitration in accordance with the
following Clauses.
[14] It is to be noted that the parties expressed the process of what was thereafter to occur as the
dispute or difference being “determined by arbitration”, though, of course, the following words were
“in accordance with the following Clauses.”
[15] Clauses 35.11 and 35.12 are the critical provisions in the appeal. They were as follows:
[35.11] Negotiation
If:
(a) a notice of appeal is given in accordance with Clause 35.9; or
(b) the dispute or difference for which the notice under Clause 35.1 has been given does
not relate to a Direction of the Principal’s Representative under one of the Clauses
referred to in Attachment “A”,
the dispute or difference is to be referred to a senior representative of each of the Principal
and Contractor who must:
(c) meet and undertake genuine and good faith negotiations with a view to resolving the
dispute or difference; and
(d) if they cannot resolve the dispute or difference within 14 days after the giving of the
notice under Clause 35.1 or 35.9 (whichever is later), the matter at issue will be referred
to the Australian Dispute Centre for mediation.
[35.12] Arbitration
If the senior representatives referred to in Clause 35.11 cannot resolve the dispute or
difference or, where the matter is referred to mediation under Clause 35.11(d), the matter
is not settled within 42 days after the giving of the notice under Clause 35.1 or Clause 35.9
(whichever is the later), or within such longer period of time as these representatives may
agree in writing, the dispute or difference will be referred to arbitration.
The arbitration will be conducted before a person to be:
(a) agreed between the parties; or
(b) failing agreement within:
(i) 49 days after the giving of the notice under Clause 35.1 or Clause 35.9 (whichever
is the later); or
(ii) where the senior representatives referred to in Clause 35.11 have agreed upon a
longer period of time prior to reference to arbitration, 7 days after the expiration
of that period,
appointed by the President for the time being of The Institute of Arbitrators and
Mediators Australia.
The Rules for the Conduct of Commercial Arbitration of The Institute of Arbitrators and
Mediators will apply to the arbitration.
The arbitrator will have power to:
(c) open up and review any Direction of the Principal’s Representative and decision by the
Adjudicator; and
(d) grant all legal, equitable and statutory remedies.
[4.350]
233
Civil Procedure in New South Wales
United Group Rail Services v Rail Corporation NSW cont.
[16] Clause 35.13 provided that cl 35 would survive termination of the contract.
[17] Clause 35.14 provided for the continuation of the work under the contract despite the
existence of a dispute between the parties.
[18] Clause 2.2 of the General Conditions of Contract was an interpretation provision, which
provided that unless the context indicated a contrary intention headings were for convenience only
and did not affect interpretation.
[19] Clause 2.14 dealt with severability in the following terms:
[2.14] Severability of Provisions
If at any time any provision of this Contract is or becomes illegal, invalid or unenforceable
in any respect under the law of any jurisdiction, that will not affect or impair:
(a) the legality, validity or enforceability in that jurisdiction of any other provision of this
Contract; or
(b) the legality, validity or enforceability under the law of any other jurisdiction of that or
any other provision of this Contract.
The issues
[20] The parties were agreed that subcl 35.11(d), the mediation clause, was uncertain and
unenforceable. The agreement of the respondent (Railcorp) to this proposition was based on the fact
that the “Australian Dispute Centre” did not exist. The parties’ agreement recorded by the primary
judge at [5]‌in his reasons was that subcl 35.11(d) was “void for uncertainty.”
[21] United also asserted (and Railcorp denied) that subcl 35.11(c) was also uncertain and therefore
void and unenforceable.
[22] Most importantly, United asserted (and Railcorp denied) that cl 35.12 (providing for the
reference to arbitration) was not severable from cl 35.11, such that in circumstances where
subcl 35.11(d) or subcl 35.11(c) and (d) was or were void and unenforceable, cl 35.12 was likewise
void and unenforceable. The result of this argument, if it were accepted, would be that any dispute
will be justiciable in Court, where the power to send any dispute to a referee would be available. The
consequences and commercial relevance of success of United’s arguments were not explored.
The primary judge’s decision
[23] The primary judge (Rein J sitting in the Technology and Construction List of the Equity
Division) rejected the arguments of United. His Honour found subcl 35.11(c) valid and enforceable.
His Honour found cl 35.12 severable from the agreed voidness and unenforceability of subcl 35.11(d).
The primary judge’s reasons and the arguments of the parties
[24] As to the question of the certainty of subcl 35.11(c) the primary judge concluded by reference
to various authorities, including in particular Coal Cliff Collieries Pty Ltd v Sijehama Pty Ltd (1991)
24 NSWSLR 1; Burger King Corporation v Hungry Jacks Pty Ltd [2001] NSWCA 187; 69 NSWLR 558;
Alcatel Australia Ltd v Scarcella (1998) 44 NSWLR 349; and Con Kallergis Pty Limited v Calshonie Pty
Limited (1998) 14 BCL 201 that the obligation to undertake genuine and good faith negotiations had
sufficient content not to be uncertain.
[25] As to the question of severability, the primary judge concluded (at [37] of his reasons) that it
was not the intention of the parties that disputes would be referred to arbitration only if the negotiation
and mediation clauses were valid. His Honour’s reasoning was contained over the following eight
pages and included reference to decisions at first instance of judges in the Commercial List. I intend
no disrespect to the thoughtful and careful reasons of the primary judge by not analysing those
reasons. I agree with his Honour’s conclusions, both as to the sufficient certainty and enforceability of
234
[4.350]
Alternatives to Litigation – Negotiation and Mediation
Chapter 4
United Group Rail Services v Rail Corporation NSW cont.
subcl 35.11(c) and the severability of cl 35.12. In circumstances where there can be only one correct
answer to a question (here legal questions as to the proper meaning and content of a provision of
a contract and the severability of another provision based on the intention of the parties pursuant
to the process of contractual construction and the application of legal reasoning) error or not in the
primary judge’s approach will be demonstrated in an appeal by way of rehearing by the appeal court
considering the question for itself and reaching a different or the same conclusion.
[Allsop P discussed the authorities dealing with whether a clause seeking to create a legal obligation
to negotiate in good faith is legally binding and sufficiently certain to be enforceable in relation to
clause 35.11(c).]
[78] This is a dispute resolution clause. To require in such a clause this degree of constraint [ie good
faith meaning that a party is free to pursue its own interests in negotiation, but by reference to the
honest and genuine appreciation of the rights and entitlements arising out of the relationship and
touching the controversy] on the positions of the parties reflects developments in dispute resolution
generally. The recognition of the important public policy in the interests of the efficient use of public
and private resources and the promotion of the private interests of members of the public and the
commercial community in the efficient conduct of dispute resolution in litigation, mediation and
arbitration in a fair, speedy and cost efficient manner attends all aspects of dispute resolution: cf
“just, quick and cheap resolution of the real issues”: Civil Procedure Act 2005 (NSW), s 56. Parties are
expected to co-​operate with each other in the isolation of real issues for litigation and to deal with
each other in litigation in court in a manner requiring co-​operation, clarity and disclosure: see for
example Baulderstone Hornibrook Engineering Pty Ltd v Gordian Runoff Limited [2008] NSWCA 243 at
[160]-​[165] and Bellevarde Constructions Pty Ltd v CPC Energy Pty Ltd [2008] NSWCA 228 at [55]-​[56].
As part of its procedure, the Court can order mediation: Civil Procedure Act, s 26. Section 27 of that
Act states that it is the duty of each party to the proceedings that have been referred to mediation
to participate “in good faith” in the mediation. Costs sanctions can attend this duty cf Capolingua v
Phylum Pty Ltd (1991) 5 WAR 137.
[79] The contract here is, of course, not one governed by the Civil Procedure Act. It is, however,
a modern contract with a sophisticated and detailed dispute resolution clause seeking to employ
various tools to resolve disputes. The definition of “Law” in cl 2.2 makes clear that the law of New
South Wales (and, implicitly, the common law of Australia) is the proper law of the contract. One
of the available tools of dispute resolution is the obligation to engage in negotiations in a manner
reflective of modern dispute resolution approaches and techniques –​to negotiate genuinely and in
good faith, with a fidelity to the bargain and to the rights and obligations it has produced within
the framework of the controversy. This is a reflection, or echo, of the duty, if the matter were to be
litigated in court, to exercise a degree of co-​operation to isolate issues for trial that are genuinely in
dispute and to resolve them as speedily and efficiently as possible.
[80] The public policy in promoting efficient dispute resolution, especially commercial dispute
resolution, requires that, where possible, real and enforceable content be given to clauses such as
cll 35.11 and 35.12 to encourage approaches by, and attitudes of, parties conducive to the resolution
of disputes without expensive litigation, arbitral or curial.
[81] The business people here chose words to describe the kind of negotiations they wanted to
undertake, “genuine and good faith negotiations”, meaning here honest and genuine with a fidelity
to the bargain. That should be enforced. In my view, subcl 35.11(c) was not uncertain and had
identifiable content.

[4.350]
235
CHAPTER 5
Alternatives to Litigation –​Arbitration,
Referees and Expert Determination
[5.10]
[5.20]
[5.40]
INTRODUCTION.........................................................................................................
ARBITRATION..............................................................................................................
[5.30]
Compulsory arbitration...............................................................................
COMMERCIAL ARBITRATION ACT 2010 (NSW)...........................................................
[5.50]
Judicial Support for Arbitration in Australia.............................................
[5.60]
Commercial Arbitration Bill 2010.........................................................
[5.80]
John Holland v Kellogg Brown & Root....................................................
[5.85]
Rinehart v Hancock Prospecting...........................................................
[5.100]
Larkden v Lloyd Energy Systems...........................................................
[5.110]
[5.120]
[5.140]
[5.150]
[5.170]
[5.180]
[5.200]
[5.210]
[5.280]
Commercial Arbitration Act 2010 (NSW) ss 18, 19, 23–​25, 28,
29, 31, 32, 33B...............................................................................
Westport Insurance v Gordian Runoff....................................................
Commercial Arbitration Act 2010 (NSW) ss 34, 34A.................................
Colin Joss v Cube Furniture..................................................................
Commercial Arbitration Act 2010 (NSW) ss 35, 36..................................
Uniform Civil Procedure Rules 2005 (NSW) rr 47.1–​47.4, 47.6–​47.8...........
Practice Note SC Eq 9........................................................................
COMPULSORY REFERRAL TO A REFEREE......................................................................
[5.220]
Uniform Civil Procedure Rules 2005 (NSW) rr 20.13–​20.24.......................
[5.230]
Cave v Allen Jack and Cottier...............................................................
[5.240]
Practice Note SC Eq 3........................................................................
[5.260]
Chocolate Factory Apartments v Westpoint Finance..................................
[5.270]
Bellevarde Constructions v CPC Energy..................................................
EXPERT DETERMINATION............................................................................................
[5.300] Advantages and disadvantages of expert determination..............................
[5.310]
Challenging the expert’s decision..........................................................
[5.320]
Shoalhaven City Council v Firedam Civil Engineering.................................
[5.330]
Strike Australia v Data Base Corporate...................................................
[5.340] Comparing arbitration and expert determination........................................
237
237
238
239
239
240
243
247
248
251
255
258
260
261
262
264
266
266
269
271
273
275
275
279
280
280
282
283
INTRODUCTION
[5.10] This chapter addresses three forms of alternative dispute resolution (ADR) that are
determinative or binding on disputants: arbitration, use of a referee and expert determination.
It is the binding nature of these forms of ADR that distinguishes them from negotiation and
mediation. Arbitration is usually employed to resolve an entire dispute. Referees and expert
determination may be used to determine particular questions or an entire dispute requiring
the application of expertise.
ARBITRATION
[5.20] Arbitration is a quasi-​judicial process. The dispute is submitted to a third party (an
arbitrator) who renders a binding determination (an award). In Re Carus-​Wilson & Greene
(1886) 18 QBD 7, Lord Esher MR described the determinative feature of an arbitration as
[5.20]
237
Civil Procedure in New South Wales
being an “inquiry in the nature of a judicial inquiry”. Lord Wheatley in Arenson v Casson
Beckman Rutley & Co [1977] AC 405 at 428 described the indicia of an arbitration as follows:
(a) there is a dispute or a difference between the parties which has been formulated in some
way or another; (b) the dispute or difference has been remitted by the parties to the person
to resolve in such a manner that he is called upon to exercise a judicial function; (c) where
appropriate, the parties must have been provided with an opportunity to present evidence and/​
or submissions in support of their respective claims in the dispute; and (d) the parties have
agreed to accept his decision.
Arbitrations can be pursuant to a court-​annexed scheme or under specific legislation or by
private agreement. Parties may agree to arbitration at the outset of dealings, for example, an
arbitration process will be the method of dispute resolution between contracting parties or
arbitration can be chosen after a dispute has arisen.
The arbitration hearing is an adversarial process where the arbitrator acts in a judicial
manner. The arbitrator does not hear one party in the absence of the other. The arbitrator
considers evidence and then makes an award. Arbitration pursuant to Pt 5 of the Civil
Procedure Act 2005 (NSW) (CPA) is briefly discussed, with the main focus being on the
Commercial Arbitration Act 2010 (NSW).
Compulsory arbitration
[5.30] Court-​
annexed arbitration was introduced into NSW on 1 July 1983 with the
commencement of the Arbitration (Civil Actions) Act 1983 (NSW). The provisions in this Act
were moved into the CPA upon its enactment.
The court may order that proceedings before it be referred for determination by an
arbitrator: CPA s 38. Rule 20.8 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR)
provides that proceedings involving allegations of fraud and proceedings in the Small Claims
Division of the Local Court cannot be referred for arbitration.
The jurisdiction conferred on an arbitrator is part of the jurisdiction of the court: CPA
s 37. The arbitrator determines the procedure for the arbitration, but the rules of evidence
apply: see CPA ss 49, 51. However, the arbitrator does not have power to compel witnesses,
issue subpoenas or punish for contempt. If conduct giving rise to such issues occurs in the
arbitration, this must be referred back to the court: see CPA ss 50, 52 and 53. The arbitrator
determines a dispute on the evidence in a similar manner to a court. The arbitrator usually
hears submissions from the parties. The arbitrator then makes an award. The award records
the determination and reasons in writing and is signed: s 39. The award is sent to the referring
court. If the award is not the subject of a rehearing then the award is final and conclusive, and
is taken to be a judgment of the referring court: s 40.
A dissatisfied party in an arbitration can apply for a rehearing: CPA ss 42–​47. An application
for a rehearing under s 42 is to be made by notice of motion: UCPR r 20.12. The rehearing
takes place before a judge. Once an application for a rehearing has been filed within time,
the court is required to order a full or limited rehearing in all but the limited exceptional
circumstances set out in s 43, namely:
• An order for rehearing may not be made unless the amount claimed in the proceedings, or
the value of the property to which the proceedings relate, exceeds the jurisdictional limit of
the Local Court when sitting in its Small Claims Division.
• An order for rehearing need not be made if it appears to the court that the applicant failed
to attend a hearing before an arbitrator without good reason.
238
[5.30]
Alternatives to Litigation – Arbitration, Referees and Expert Determination
Chapter 5
As a result, while a court can compulsorily refer a case to arbitration, a dissatisfied party
can obtain a rehearing with relative ease. Rehearings involve resolving the dispute afresh.
Oral evidence given in the arbitration is not admissible and documentary evidence must be
re-​tendered.
The court may make a costs order in respect of both the referred arbitration and the
rehearing: CPA s 46. Costs may be ordered against a party who makes a tactical decision
not to call available evidence at the arbitration that is then called at a rehearing. In such
circumstances, the court may order costs against that party: MacDougall v Curleveski (1996)
40 NSWLR 430 and Quach v Mustafa (unreported, NSWCA, Kirby P, 15 June 1995), also see
Morgan v Johnson (1998) 44 NSWLR 578; Howard v Telstra Corp Ltd [2003] NSWCA 188;
and Sydney City Council v Geftlick [2006] NSWCA 280.
Although the arbitral procedure under the CPA has some flexibility, there are specific
requirements which must be adhered to so that in important respects it operates differently
from other forms of arbitration, including the Commercial Arbitration Act 2010 (NSW). See
WesTrac Pty Ltd v Eastcoast OTR Tyres Pty Ltd [2008] NSWSC 894 at [35]–​[39].
The Supreme Court’s 2017 Annual Review p 33 reports:
Use of arbitration for Supreme Court cases is possible but now extremely rare. The most recent
referral to arbitration occurred in 2006 (one referral only in that year). Arbitration of Supreme
Court cases declined following re-​distribution of work among the State’s courts. The types of
cases that typically had been referred to arbitration no longer come to the Supreme Court.
The District Court Annual Reviews for 2011 to 2017 show no cases being resolved by
arbitration. Possible explanations for the court’s arbitration procedure not being utilised are
the ease by which a rehearing may be obtained –​Barrett J in WesTrac Pty Ltd v Eastcoast
OTR Tyres Pty Ltd [2008] NSWSC 894 at [38] stated that it “can be displaced virtually
at the whim of a party and replaced by a judicial process and a judicial determination”.
This can mean a duplication of costs and increased delay. Further, the relative formality that
characterises arbitration pursuant to the CPA makes it similar to a court adjudication so that
the advantages of reduced cost and delay may not exist.
COMMERCIAL ARBITRATION ACT 2010 (NSW)
[5.40] An alternative form of arbitration is that provided for under the Commercial Arbitration
Act 2010 (NSW) which applies to domestic commercial arbitration. International commercial
arbitration is governed by the International Arbitration Act 1974 (Cth). An outline of the
procedure for domestic commercial arbitration is given below through reference to the Second
Reading Speech and key provisions in the Act. Each of the provisions of the Commercial
Arbitration Act 2010 (NSW) is discussed in detail in Jones D, Commercial Arbitration in
Australia (2nd ed, Thomson Reuters, 2013). However, first the advantages and disadvantages
of arbitration are set out.
Judicial Support for Arbitration in Australia
[5.50] Chief Justice PA Keane, Federal Court of Australia, Judicial Support for Arbitration in Australia,
Opening address, Financial Review International Dispute Resolution Conference, Sydney, 15 October
2010 [footnotes omitted]
[5.50]
239
Civil Procedure in New South Wales
Judicial Support for Arbitration in Australia cont.
Arbitration as a method of dispute resolution is seen to offer the major benefits of enforceability,
neutrality, speed and expertise over court based determinations; and, because arbitration is quicker
and more expert, it is likely to be cheaper than the lengthier and more elaborate proceedings
in court. It is a private proceeding which may be held in private. And international arbitration
offers traders a mode of dispute resolution which is not skewed by local policies, peculiarities or
prejudices.
At the theoretical level, arbitration is distinguished from the dispute resolution mechanism provided
by the state, ie the courts, by the circumstance that, with arbitration, the dispute is resolved by a
person or persons whose authority to decide is derived from the voluntary agreement of the parties
to the dispute.
Ultimately, “the scope of judicial review of arbitration awards necessarily determines the utility of
the arbitration process.” As stated by Justice Harper of the Victorian Supreme Court:
Those who choose to resolve their disputes by invoking the provisions of the Commercial
Arbitration Act must take the good with the bad. They trade litigation, with its strict
adherence to justice in accordance with law and its relatively generous rights of appeal, for
a species of alternative dispute resolution with its advantages of speed and, possibly, cost –​
but with more limited rights of recourse to the courts thereafter. In short, they thereby take
a step which limits the power of this Court subsequently to intervene.
On the other hand, as was said by Justice Rares of the Federal Court:
Courts have an important role to play which is complimentary to arbitration. Courts
systematise and explain the legal principles applicable in particular, as well as frequently
occurring, situations faced by those involved in commerce. … Arbitrations cannot offer
that perspective because they are conducted confidentially. And, no matter how eminent
the arbitrator(s) may be, an award in one arbitration does not bind any other arbitrator or
relationship between contracting parties.
No one would suggest that the commercial entities who seek the benefits offered by arbitration as a
method of dispute resolution are indifferent to the quality of the decision-​making process by which
they have agreed to abide. No party to a commercial dispute would be content to be bound by a
dishonest or blatantly incompetent decision.
There is, therefore, a legitimate place for some intervention by the judicial organ of states in
which arbitrations are conducted or sought to be enforced to ensure that the arbitration process is
conducted fairly in conformity with the reasonable expectations of the parties to the dispute.

Commercial Arbitration Bill 2010
[5.60] The Hon John Hatzistergos, Attorney-​General, Second Reading Speech, Commercial Arbitration
Bill 2010, Legislative Council, Parliament of NSW, 12 May 2010
The Commercial Arbitration Bill 2010 will repeal the Commercial Arbitration Act 1984 and provide a
new procedural framework for the conduct of domestic commercial arbitrations. The bill facilitates
the use of arbitration agreements to manage domestic commercial disputes and will ensure that
arbitration provides a cost effective and efficient alternative to litigation in Australia. The current Act
is part of uniform domestic arbitration legislation across all States and Territories. … At the May 2010
meeting of the Standing Committee of Attorneys General, Ministers agreed to update the uniform
legislation. This updated law would be based on the United Nations Commission on International
Trade Law [UNCITRAL] Model Law on International Commercial Arbitration …
240
[5.60]
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Commercial Arbitration Bill 2010 cont.
There are a number of good reasons for adopting the UNCITRAL model law as the basis for the
domestic law. First, the UNCITRAL model law has legitimacy and familiarity worldwide. It has provided
an effective framework for the conduct of international arbitrations in many jurisdictions, including
Australia, for over 24 years. It provides a well-​understood procedural framework to deal with issues
such as the appointment of arbitrators, jurisdiction of arbitrators, conduct of arbitral proceedings
and the makings of awards, and therefore is easily adapted to the conduct of domestic arbitrations.
Indeed, jurisdictions such as New Zealand and Singapore have based their domestic arbitration
legislation on the UNCITRAL model law, and it has proven appropriate. Second, basing domestic
commercial arbitration legislation on the UNCITRAL model law creates national consistency in the
regulation and conduct of international and domestic commercial arbitration. The Commonwealth
International Arbitration Act 1974 gives effect to the model law in relation to international arbitrations.
Many businesses, including legal ones, operate domestically and internationally, and one set of
procedures for managing commercial disputes makes sense. Thirdly, practitioners and courts will be
able to draw on case law and practice in the Commonwealth and overseas to inform the interpretation
and application of its provisions …
I turn now to the details of the commercial arbitration framework established by the provisions
of the bill. Part 1 of the bill applies the bill to domestic commercial arbitration and clarifies that it is
not a domestic arbitration if it is an international arbitration for the purposes of the Commonwealth
Act. Part 2 of the bill defines an arbitration agreement and requires a court before which an action
is brought to refer that matter to arbitration if it is the subject of [an] arbitration agreement and a
party so requests. Part 3 deals with the composition of arbitral tribunals and provides flexibility and
autonomy to parties in selecting the arbitrator or arbitral tribunal to decide their dispute. It enables
parties not only to agree on the number or [sic] arbitrators but the process by which they will be
selected and how they may be challenged. It also provides a default position should the parties not be
able to reach agreement. Clause 12 sets out the grounds on which the appointment of an arbitrator
may be challenged and obliges proposed arbitrators to disclose any circumstances likely to give rise
to justifiable doubts as to their impartiality or independence.
The jurisdiction of arbitral tribunals is dealt with in part 4, which makes it clear that an arbitral
tribunal is competent to determine whether it has jurisdiction in a dispute but also enables a party to
seek a ruling on the matter from the court where a tribunal determines that it has jurisdiction. Interim
measures are dealt with in part 4A of the bill. It provides power to arbitral tribunals to grant interim
measures for purposes such as maintenance of the status quo and the preservation of assets and
evidence. The bill also contains power to grant enumerated interim and procedural orders in addition
to those contained in the UNCITRAL model law.
Arbitral tribunals are granted the flexibility, unless the parties otherwise agree, to conduct an
arbitration on a “stop-​clock” basis in which the time allocated to each party in the hearing is recorded
progressively and strictly enforced. This can enable arbitral tribunals to conduct arbitrations in a
manner that is proportionate to the amount of money involved and the complexity of the issues
in the matter. Similarly, clause 33B, contained in part 6 of the bill, enables an arbitral tribunal to
limit the costs of arbitration, or any part of the arbitral proceedings, to a specified amount, unless
otherwise agreed by the parties. This gives arbitral tribunals the flexibility to cap costs on the basis of
proportionality –​another mechanism to ensure that arbitrations can be conducted in a proportionate
manner to the money and complexity of the issues involved.
Part 4A also provides for the recognition and enforcement of interim measures, issued under a
law of New South Wales or of another State or Territory, in certain circumstances. The grounds for
refusing recognition or enforcement of an interim measure are also contained in part 4A. The conduct
of arbitral proceedings are dealt with in part 5 of the bill, which provides that parties must be given
a fair hearing and that they are free to agree on the procedure to be followed by an arbitral tribunal,
or, in the absence of agreement, for the arbitral tribunal to conduct the arbitration as it considers
appropriate. This ensures that parties and arbitral tribunals are granted flexibility to adapt the conduct
of the proceedings to the particular dispute before them.
[5.60]
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Civil Procedure in New South Wales
Commercial Arbitration Bill 2010 cont.
Part 5 includes some provisions additional to those in the model law to ensure that arbitrations
can be conducted efficiently and cost-​effectively. Clause 24B imposes a duty on parties to do all
things necessary for the proper and expeditious conduct of arbitral proceedings. Clause 25 provides
the powers of an arbitral tribunal in the event of the default of one of the parties. Additional powers
to those contained in the UNCITRAL model are provided by clause 25 to ensure that arbitral tribunals
have sufficient powers to deal with delay by parties or failure to comply with a direction of the
tribunal.
Clause 27A enables parties, with the consent of the arbitral tribunal, to make an application to the
court to issue a subpoena requiring a person to attend arbitral proceedings or to produce documents.
Clause 27D provides that an arbitrator can act as a mediator, conciliator or other non-​
arbitral
intermediary, if the parties so agree, to provide further flexibility for parties to agree on how their
disputes are to be determined. If, however, a mediation or conciliation is not successful an arbitrator
is prevented from resuming as an arbitrator without the written consent of all parties.
Part 5 also provides an optional confidentiality regime. Confidentiality is viewed as one of the key
benefits of arbitration for parties dealing with sensitive commercial topics. These provisions are drafted
consistently with those of the Commonwealth Act and provide a default position if an alternative
confidentiality regime is not agreed upon by the parties. As parties often assume that arbitration is
both private and confidential, the provisions apply on an opt-​out basis to cover situations in which an
arbitration agreement does not cover confidentiality. Part 6 of the bill covers the making of awards
and the termination of proceedings.
The UNCITRAL model law has been supplemented by additional provisions to deal with the issue
of costs and the awarding of interest. As stakeholders overwhelmingly suggested that harmonised
treatment of costs and interests across international and domestic legislation was desirable, these are
dealt with consistently with the Commonwealth Act. Recourse against award is dealt with in part 7 of
the bill, which outlines the circumstances in which an application can be made for the setting aside of
an award, or grounds upon which parties can appeal an award, if parties have agreed to allow appeals
under the optional provision.
Recognition and enforcement of arbitral awards is dealt with in part 8 of the bill, which allows
for the recognition of awards irrespective of the State or Territory in which it was made, and which
outlines the grounds on which enforcement can be refused.

[5.70] To refer disputes to arbitration and for an arbitral tribunal to be constituted there
must be a valid and binding arbitration agreement. Section 7 of the Commercial Arbitration
Act 2010 (NSW) defines an arbitration agreement as an agreement by the parties to submit
to arbitration all or certain disputes which have arisen or which may arise between them in
respect of a defined legal relationship, whether contractual or not. An arbitration agreement
may be in the form of an arbitration clause in a contract or in the form of a separate agreement.
The arbitration agreement must be in writing. These requirements must be met for the Act
to apply.
Section 8 reinforces the application of the Act by requiring a Court to stay litigation where
parties have a valid arbitration agreement. Section 8 provides:
(1) A court before which an action is brought in a matter which is the subject of an arbitration
agreement must, if a party so requests not later than when submitting the party’s first
statement on the substance of the dispute, refer the parties to arbitration unless it finds that
the agreement is null and void, inoperative or incapable of being performed.
The word “court” with a lower case “c” is not defined. The meaning of the word “court” in the
context of the Victorian equivalent of s 8 was considered in Subway Systems Australia Pty Ltd
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v Ireland [2014] VSCA 142. The proceedings involved a dispute between parties to a franchise
agreement which contained an arbitration clause but the franchisee commenced proceedings
in the Victorian Civil and Administrative Tribunal. The Victorian Court of Appeal (Maxwell P,
Beach JA with Kyrou AJA dissenting) held that the tribunal was a court for the purposes of
s 8. A court was said to be a body or organ of the judicial system of a State and was not limited
to those organs actually called a court.
John Holland v Kellogg Brown & Root
[5.80] John Holland Pty Ltd v Kellogg Brown & Root Pty Ltd [2015] NSWSC 451
[John Holland Pty Ltd was engaged by Downer EDI Rail Pty Ltd (Downer) to design and build a
rail facility known as the Auburn Maintenance Centre. John Holland engaged the first defendant
(KBR) to furnish certain design and documentation services including the design of stormwater
detention facilities for the AMC (KBR Contract). By written agreement entered into on 15 August
2008, John Holland engaged the second defendant (Atlantis) to design, manufacture, supply and
certify the stormwater detention facilities to be used for the AMC (Atlantis Contract). Atlantis
installed a modular tank system under the AMC car park for the purpose of providing storm water
on site detention. Construction of the AMC was completed in 2010. Allegedly, about three and
a half years after construction, subsidence of the pavement in the AMC car park was observed.
Another builder, Laing O’Rourke, had been carrying out building and excavation works on an
adjoining site.
Both the KBR Contract and Atlantis Contract contained arbitration agreements as part of dispute
resolution clauses that provided for a number of steps to resolve any dispute. The KBR Contract
required the parties to meet and negotiate as a first step, which they did. At that conference discussions
included whether litigation should be employed as John Holland was concerned about the expiry of a
limitation period. On 28 August 2014 John Holland commenced proceedings against KBR and Atlantis
in the Supreme Court for damages and indemnity. KBR and Atlantis moved the Court for the matter
to be referred to arbitration pursuant to s 8(1) of the Commercial Arbitration Act 2010 (NSW) (“the
Act”). John Holland argued:
(1)
the action is not the subject of the arbitration agreement because a dispute or difference
under cl 12.2 of the KBR Contract is limited to one between John Holland and KBR alone,
whereas the dispute the subject of the action involves Atlantis and Downer and may also
involve Laing O’Rourke. Construction of cl 12 of the KBR Contract should be informed by the
commercial presumption that the parties did not intend the inconvenience of having possible
disputes from their transaction being heard in multiple places;
(2)
the arbitration agreement is inoperative because during the conference, John Holland and
KBR agreed, as contemplated by cl 12.2, on another “alternative dispute resolution process”,
namely court proceedings; and
(3)
in the alternative to (2), if there is no agreement as contemplated by cl 12.2, KBR is estopped
from denying the existence of such an agreement or from asserting its private rights arising
under cl 12.3 because John Holland and KBR held the common assumption (known by KBR to
be held by John Holland) that litigation was the proper course and John Holland acted to its
detriment by taking the course of litigation, namely by incurring costs and exposing itself to a
limitations defence which KBR would not otherwise have had.]
HAMMERSCHLAG J
[15] Clause 12 of the KBR Contract is entitled Settlement of Disputes. Clauses 12.2 –​12.6 are in
the following terms.
12.2 NEGOTIATION OF DISPUTE
In the event of a dispute or difference (other than in relation to the MF Subcontractor’s
assessment of whether milestones have been met) arising out of or relating to the
[5.80]
243
Civil Procedure in New South Wales
John Holland v Kellogg Brown & Root cont.
performance of the Agreement or the breach, rectification, termination, frustration or
invalidity thereof, (hereinafter referred to as the “Dispute”), every endeavor shall be made
to resolve the Dispute on its merits by negotiation. The parties shall attend at least one
meeting to discuss the matter at issue, as a condition precedent to commencing any other
proceeding in respect of the dispute. If the Dispute cannot be resolved by negotiation, the
parties shall confer in order to ascertain whether they agree that the Dispute shall first be
subject to the process of conciliation, mediation, appraisal, or such other alternative dispute
resolution process as may be appropriate in the circumstances of the Dispute and, if they so
agree, the Dispute shall be referred to such process.
12.3 GROUND FOR ARBITRATION
In the event that the Dispute cannot be resolved in accordance with the foregoing procedure
then a notice may be issued by one party to the other party requiring that the Dispute be
referred to arbitration.
12.4 ARBITRATOR
Arbitration shall be effected by a single Arbitrator in accordance with and subject to the
Institute of Arbitrators and Mediators Australia Rules for the Conduct of Commercial
Arbitration. Any Conciliator, Mediator or Appraiser who has been previously appointed
shall not be appointed as Arbitrator, nor may that person be called by either party in the
arbitration unless both parties agree in writing.
The parties and the Arbitrator shall meet to discuss and develop procedures appropriate
to expedite the conduct of the arbitration and the parties shall cooperate with the Arbitrator
in expeditious conduct of the arbitration.
12.5 COST OF ARBITRATION
The cost of Arbitration submission, reference and award, together with the apportionment
thereof shall be at the discretion of the Arbitrator.
12.6 LEGAL ACTIONS
Compliance by the parties with the procedures of clauses 12 is a condition precedent to
either party being entitled to pursue any subsequent relief or remedy.
[16] Clause 15 of the KBR contract is in the following terms:
15. NON-​WAIVER OF CONDITIONS
Except as provided in the Agreement, none of the terms and conditions, requirements and
obligations of the Agreement shall be varied, waived, discharged or released at law or in
equity except with the prior consent in writing of the parties in each instance.
In the event of any conflict or inconsistency between the provisions of clauses 1 to 15
hereof and the provisions of the Special Conditions, if any, then to the event only of such
conflict or inconsistency, the provisions of the Special Conditions shall prevail.
…
[65] Section 8(1) applies where there is brought before a court an action in a matter which is
the subject of an arbitration agreement. The section is enlivened where the matter, the subject
of the action, that is, the rights or liabilities in controversy, fall within the ambit of controversies
which the parties to the arbitration agreement have, on its proper construction, agreed to
refer to arbitration. Section 8(1) requires the court to refer the parties to arbitration if a party so
requests. The section does not expressly say so, but it seems clear that the compulsory reference
pertains only to the extent that the subject of the action is also the subject of the arbitration
agreement.
[66] Determining the extent of any overlap requires examination of the relevant pleading or
other process revealing the elements of the action, and examination of the terms of the arbitration
agreement.
244
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John Holland v Kellogg Brown & Root cont.
[67] Importantly, s 7(1) defines Arbitration Agreement as an agreement by the parties to submit to
arbitration all or certain disputes which have arisen or which may arise between them in respect of a
defined legal relationship, whether contractual or not.
[68] Clause 12 of the KBR Con[t]‌ract captures any dispute or difference (other than in relation
to John Holland’s assessment of whether milestones have been met) arising out of or relating to the
performance of the KBR Contract or its breach.
[69] The courts have repeatedly held that words such as “arising out of”, “arising under”, “in
connection with” or “connected with” have a wide ambit and that when commercial parties choose a
forum for the resolution of disputes which may arise between them, such provisions should be liberally
construed so as to further their ultimate intent, namely, that their disputes should be susceptible to
the forum which they have chosen; see Francis Travel Marketing Pty Ltd v Virgin Atlantic Airways Ltd
(1996) 39 NSWLR 160; IBM Australia Ltd v National Distribution Services Pty Ltd (1999) 22 NSWLR 466.
[70] In its Summons, John Holland sues KBR for, amongst other things, damages for breach of
contract and indemnity against all loss or damage arising out of its breach of contract. In Section B of its
Technology and Construction List Statement, John Holland articulates as issues likely to arise: whether
the failures in the stormwater detention facilities were the result of defects in the design prepared
by KBR, and if so, whether KBR breached the terms of the KBR Contract, whether it breached the
warranties provided for under the KBR Contract, whether KBR is required to indemnify John Holland
pursuant to the KBR Contract, and whether KBR was negligent in the performance of its services
under the KBR Contract. It may be assumed, with some degree of confidence, that these claims will
be controversial.
[71] As between John Holland and KBR, the dispute between them patently arises out of or relates
to performance of the KBR Contract or breach thereof and is susceptible to their arbitration agreement.
It is not suggested that some elements of the dispute are susceptible whereas others are not.
[72] The thrust of John Holland’s submission is that because it also has rights against Atlantis
(which it has chosen to vindicate in the same action), because Downer may have claims against it for
which it may seek indemnity against KBR and because it, KBR and others may have claims (or cross-​
claims) against Laing O’Rourke, the dispute between John Holland and KBR is not a dispute arising
out of or relating to performance of the KBR contract or its breach. This needs only to be stated to
be revealed as unsound. There may be rights and liabilities between each or both of them and other
parties or strangers to the action. That has no bearing on whether the dispute that exists between
John Holland and KBR is one which arises out of or relates to the performance of the contract between
them or its breach.
…
[86] … The fact there may be an overlap of issues with claims between one or other of the parties
to the arbitration agreement and third parties, with the consequent risk of inconsistent findings
arising out of a multiplicity or [sic] proceedings, is no longer a relevant factor to be considered by a
court in deciding whether or not to refer parties to arbitration (or grant a stay in that context) (see
A Monichino, “International Arbitration in Australia –​2010/​2011 in review” (2011) 22 ADRJ 215).
[87] Section 8(1) reflects the modern trend both domestically and internationally to facilitate and
promote the use of arbitration and to minimise judicial intervention in the process. It gives full effect
to the parties’ contractual freedom, which they have exercised by their arbitration agreement, to have
disputes comprehended by that agreement arbitrated.
[88] In principle, whether a dispute is arbitrable or not cannot depend on a plaintiff party to an
arbitration agreement deciding to claim not only against the counterparty, but also a third party
stranger.
…
[5.80]
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Civil Procedure in New South Wales
John Holland v Kellogg Brown & Root cont.
[91] John Holland contends that at the conference a binding arrangement was concluded between
it and KBR that their dispute would be resolved, not by arbitration, but by curial litigation. It contends
that this arrangement amounted to agreement, in accordance with cl 12.2, to “[an]other alternative
dispute resolution process”. The primary issue is whether John Holland and KBR made an agreement
as alleged. The secondary issue is whether any agreement they made qualifies as an agreement to
an alternative dispute resolution process under cl 12.2. The significance of the answer to the second
question lies in the fact that an agreement under cl 12.2 to an alternative dispute resolution [process]
need not be in writing to be effective –​see cl 15.
[92] The agreement is said to arise from an exchange in which Deschamps explained John Holland’s
potential Limitations Act problems, referred to the fact that there were different resolution procedures
in various contracts and none with Laing O’Rourke, expressed the view that litigation was the most
appropriate dispute resolution procedure in the circumstances, and Glatter responded to the effect
that he agreed that litigation was the best course of action for resolution (recorded in Chedid’s file
note as “This is right –​Litigation is proper course”).
…
[96] John Holland has the onus of establishing the agreement for which it contends. This entails
proving to the reasonable satisfaction of the court that the words said to give rise to the agreement
were actually said, and that the alleged consensus was capable of forming a binding agreement and
was intended by the parties to be legally binding.
[97] John Holland falls at each of these hurdles.
…
[115] In the ordinary grammatical meaning of the words, court proceedings are not an alternative
dispute resolution process. They are a dispute resolution process to which all other resolution processes
are alternative.
[116] The words of cl 12 itself leave no room for the contention that the parties had court process
in mind as an alternative dispute resolution process. Firstly, the phrase appears after the words “the
process of conciliation, mediation, appraisal or such other …”. The processes described have the
common genus of being alternatives to court process. The generic reference to other alternative
dispute resolution process is to be construed accordingly. Clause 12.3 of the KBR Contract has in
mind that the parties will go to arbitration if the dispute cannot be settled by some such procedure.
The clear idea behind the provision is that if such a procedure fails the dispute will certainly be settled
by arbitration. There is no dispute amenable to arbitration under cl 12.2 of the KBR Contract that
cannot be settled by court process. Where cl 12.5 of the KBR Contract refers to any subsequent relief
or remedy, this is clearly a reference to court process.
[117] Thus, even had John Holland made out the agreement for which it contends, it would not
be an agreement covered by cl 12.2.
[118] The agreement for which it contends would amount to a variation of the KBR Contract,
rendered ineffective by cl 15. …
[120] John Holland’s contention that KBR is estopped from denying the existence of an agreement
under cl 12.2 or from asserting its private rights under cl 12.3 fails.
…
[132] KBR, having made a request under s 8(1), and the arbitration agreement not being null and
void, inoperative or capable [sic] of being performed, the Court must, and will, refer John Holland
and KBR to arbitration.

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Rinehart v Hancock Prospecting
[5.85] Rinehart v Hancock Prospecting Pty Ltd [2019] HCA 13
[Proceedings were commenced in the Federal Court of Australia by Bianca Rinehart and John
Hancock (the Appellants) against a number of respondents, including their mother Mrs Gina Rinehart,
that included claims that they were not bound by the terms of certain Deeds because their assent to
them was procured by misconduct. They sought declarations that the Deeds were void as against them.
These claims were referred to as “the validity claims”. Mrs Gina Rinehart sought an order pursuant to s
8(1) of the Commercial Arbitration Act 2010 (NSW) (“the NSW Act”) that the matters the subject of the
proceedings be referred to arbitration. Each of the Deeds contained an arbitral clause that provided
“[i]‌n the event that there is any dispute under this deed” there is to be a confidential arbitration.
In Rinehart v Welker (2012) 95 NSWLR 221 at 247-​249, Bathurst CJ said the phrase “under this
deed” has consistently been given a narrow meaning than phrases such as “arising out of the deed”
or “in connection with the deed”. A dispute is “under” a deed if its outcome is governed or controlled
by the deed or invokes some right created by it. The primary judge applied that reasoning and found
that the existence of a dispute “under” the Hope Downs Deed depends on the existence of the deed
itself. The Hope Downs Deed cannot be said to govern or control the outcome of a dispute about its
validity. The Full Court disagreed with the primary judge’s construction of the arbitral clause, holding
that it should be given a liberal, not a narrow, interpretation. The proceedings were stayed and the
validity claims were referred to arbitration.]
KIEFEL CJ, GAGELER, NETTLE AND GORDON JJ.
[17] When regard is had to the context of the Deeds, including the circumstances in which they
were made as reflected in the text of the Deeds, it is apparent that the conclusion reached by the Full
Court that the validity claims fell within the scope of the arbitral clauses is correct.
[44] It is well established that a commercial contract should be construed by reference to the
language used by the parties, the surrounding circumstances, and the purposes and objects to be
secured by the contract [Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640
at 656-​657 [35]]. It could not have been understood by the parties to these Deeds that any challenge
to the efficacy of the Deeds was to be determined in the public spotlight. Especially is this so with
respect to the Hope Downs Deed.
[48] A person in the position of the parties to the Hope Downs Deed would have appreciated that
disputes might once again arise, not only with respect to the claims made by Mr Hancock concerning
the trusts but also concerning the validity of the deed. It is inconceivable that such a person would
have thought that claims of the latter kind, raising allegations such as undue influence, were not to
be the subject of confidential dispute resolution but rather were to be heard and determined publicly,
in open court.

[5.90] The Commercial Arbitration Act 2010 (NSW) also deals with important pre-​requisites
to the conduct of an arbitration such as:
• the number of arbitrators (one or as agreed by the parties) –​ s 10;
• the appointment of arbitrators (as agreed by the parties, or if three arbitrators and two
parties then one arbitrator each with the arbitrators appointing the third or with court
assistance) –​  s 11;
• challenging a person’s appointment as an arbitrator –​ss 12, 13;
• the arbitral tribunal’s ability to rule on its own jurisdiction, including any objections with
respect to the existence or validity of the arbitration agreement, and a party’s ability to
request the Court to decide the matter –​ s 16;
[5.90]
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Civil Procedure in New South Wales
• place of arbitration (as agreed by the parties or as determined by the arbitral
tribunal) –​  s 20;
• language to be used (as agreed by the parties or as determined by the arbitral tribunal) –​ s 22;
• the procedure for the conduct of the arbitration which is set out below.
Larkden v Lloyd Energy Systems
[5.100] Larkden Pty Ltd v Lloyd Energy Systems Pty Ltd [2011] NSWSC 268
HAMMERSCHLAG J
[1]‌ Section 16(1) of the Commercial Arbitration Act 2010 (NSW) (“the Act”) provides that an
arbitral tribunal may rule on its own jurisdiction. Section 16(9) provides that if the arbitral tribunal
rules as a preliminary question that it has jurisdiction, any party may request, within 30 days after
having received notice of that ruling, the court to decide the matter. These pr