Ashby v Commonwealth (No 4)

Case [2012] FCA 1411

FEDERAL COURT OF AUSTRALIA

Ashby v Commonwealth of Australia (No 4)
[2012] FCA 1411

Citation: Ashby v Commonwealth of Australia (No 4) [2012] FCA 1411
Parties: JAMES HUNTER ASHBY v COMMONWEALTH OF AUSTRALIA and PETER SLIPPER
File number: NSD 580 of 2012
Judge: RARES J
Date of judgment: 12 December 2012
Corrigendum: 28 May 2013
Catchwords:

PRACTICE AND PROCEDURE – dismissal or stay – application for proceedings to be dismissed or stayed as an abuse of process pursuant to r 26.01(1) of the Federal Court Rules 2011 (Cth) – categories of abuse of process not closed – where allegations allegedly made in pleading for predominant purpose of a political attack to advance maker’s own interests – where some allegations made that were irrelevant, scandalous or calculated to injure – where applicant’s lawyer responsible for impugned allegations – where applicant and lawyer intended or aware that media would obtain a copy of pleading and publish allegations made in it

COSTS – where Court’s power to order a party to pay costs limited by s 570(1) of the Fair Work Act 2009 (Cth) – to cases where Court satisfied that applicant instituted proceedings vexatiously or without reasonable cause, or that applicant’s unreasonable act or omission caused respondent to incur costs

Held:  proceedings an abuse of process – applicant to pay costs  
Legislation: Constitution of the Commonwealth of Australia s 40
Evidence Act 1995 (Cth) s 126H
Fair Work Act 2009 (Cth) ss 340, 342, 351, 372, 545, 550, 570(1), 570(2)(a), 570(2)(b)
Federal Court of Australia Act 1976 (Cth) s 37M(2)(e)
Federal Court Rules 2011 (Cth) rr 2.32, 2.32(2,) 6.02, 8.05(1)(a), 26.01, 26.01(1)(b)
Judiciary Act 1903 (Cth) ss 78B, 78B(1)
Legal Profession Act 1987 (NSW) s 57B
Legal Profession Act 2004 (NSW)
Professional Conduct and Practice Rules 1995 (NSW)
Safety Rehabilitation and Compensation Act 1988(Cth) s 45(4)  
Cases cited:

Ahern v The Queen (1988) 165 CLR 87 applied
Ashby v Commonwealth of Australia (No 2) (2012) 203 FCR 440 referred to
Ashby v Commonwealth of Australia [2012] FCA 640 referred to
Barker v Commonwealth Bank of Australia [2012] FCA 942 applied
Burazin v Blacktown City Guardian Pty Ltd (1996) 142 ALR 144 referred to
Chamberlain v The Queen (No 2) (1984) 153 CLR 521 referred to
Clyne v NSW Bar Association (1960) 104 CLR 186 applied

Fraser-Kirk v David Jones Ltd (2010) 190 FCR 325 referred to

Jeffery & Katauskas Pty Ltd v SST Consulting Pty Ltd (2009) 239 CLR 75 applied
Jones v Skelton [1963] 63 SR (NSW) 644 applied
Kraus v Menzie [2012] FCAFC 144 applied
Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 referred to
Lewis v Daily Telegraph Ltd [1963] 1 QB 340 applied
Lewis v Daily Telegraph Ltd [1964] AC 234 applied
Llewellyn v Nine Network Australia Pty Ltd (2006) 154 FCR 293 applied
Lloyd v David Syme & Co Ltd [1986] AC 350 applied
Mirror Newspapers Ltd v Harrison (1982) 149 CLR 293 applied
Omilaju v Waltham Forest London Borough Council [2005] 1 All ER…

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AGLC
Ashby v Commonwealth of Australia (No 4) [2012] FCA 1411
Case
[2012] FCA 1411
Decision Date

CaseChat Overview and Summary

The Ashby v Commonwealth (No 4) case involved an application for the proceedings to be dismissed or stayed due to an alleged abuse of process. The plaintiff, Mr Ashby, sought damages for breach of contract and made several serious allegations against the second respondent, Mr Slipper, including sexual harassment, a consensual sexual relationship in 2003, and Cabcharge misuse. These allegations were made under absolute privilege, which is a protection for legal documents that prevents the maker from being sued for defamation. The allegations were published in the media, leading to Mr Slipper's argument that the proceedings were an abuse of the court process, intended as a political attack rather than a legitimate legal action.

The court had to decide whether the proceedings constituted an abuse of process, as defined by Rule 26.01(1) of the Federal Court Rules 2011, and whether Mr Ashby should be ordered to pay costs under section 570(1) of the Fair Work Act 2009. The court considered the nature of the allegations, their publication in the media, and the intentions behind the filing of the originating application. The court found that the allegations made in the originating application were not only irrelevant but also scandalous and calculated to injure, and that the process was misused for a political attack.

The court concluded that the proceedings were indeed an abuse of process. It dismissed the proceedings and ordered Mr Ashby to pay the second respondent's costs. The costs previously ordered to be paid by Mr Slipper to Mr Ashby were to be set off against the costs ordered under this decision. The ruling highlighted the misuse of the court's process for purposes beyond legitimate legal action and emphasised the importance of adhering to professional obligations and the proper use of legal proceedings.

Orders

Orders of the court

1. The proceedings be dismissed.

2. The applicant pay the second respondent’s costs.

3. The costs ordered on 17 August 2012 to be paid by the second respondent to the applicant be set off against costs the subject of order 2.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules.

Background

Background to the litigation

Mr Slipper also argued that the proceeding should be characterised as an abuse of the process of the Court because it was commenced and prosecuted in a manner that was seriously and unfairly burdensome, prejudicial and damaging to him, or productive of serious and unjustified harassment. He argued that the proceedings were commenced and prosecuted in a manner that brought the administration of justice into disrepute, based on those vexatious and oppressive features together with the allegedly improper purpose of Mr Ashby and his confederates. He also contended that the process of the Court had been used as an instrument of a calculated and orchestrated political and public relations campaign with the object of harming him, aiding his political opponents and advancing the interests of Mr Ashby and Ms Doane.PROCEDURAL BACKGROUND The originating application filed on 20 April 2012 was in an irregular and unusual form. It sought damages for breach of contract and should have claimed the relief that Mr Ashby sought while being accompanied by a statement of claim as required by r 8.05(1)(a) of the Federal Court Rules 2011 (Cth): Ashby v Commonwealth of Australia [2012] FCA 640 at [2]-[3]. On its final page the originating application contained a statement that the allegations it made were supported “by sworn/affirmed evidence”, that included a forensic report in respect of text messages that it set out verbatim. The originating application made a number of serious allegations concerning Mr Slipper’s conduct including that:·Mr Slipper had sexually harassed Mr Ashby in the course of his employment (the sexual harassment allegations);·in 2003 Mr Slipper had a relationship of a sexual nature with a younger male member of his staff and an encounter between them had been recorded on a video, a viewer of which had concluded that the relationship was consensual (the 2003 allegations); and·Mr Ashby had been forced on three occasions to watch Mr Slipper sign multiple Cabcharge vouchers during his employment and hand them to the driver of a vehicle in which they both travelled and that Mr Ashby intended to report these matters to the Australian Federal Police (the Cabcharge allegations).I will describe those allegations in more detail later in these reasons. Importantly, by filing the originating application in the Court, Mr Ashby, Mr Harmer and Harmers made the allegations it contained under absolute privilege. On the same day as the originating application was filed, Vanda Carson, a journalist from the Daily Telegraph, a newspaper published by News Limited or one of its subsidiaries, sought and obtained access to the “statement of claim” under r 2.32 of the Federal Court Rules. Later on 20 April 2012, Mr Lewis, sent a text message to Mr Slipper saying he would like to contact him for his comment on the allegations in “court documents”. Mr Lewis and Mr Ashby knew that Mr Slipper was then overseas. The next day many of the allegations about Mr Slipper’s conduct that were made in the originating application received significant publicity in the media.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

Even if I am wrong and Mr Ashby did have some disquiet, that could not have justified him or Mr Harmer pleading Mr Ashby’s asserted intention to go to the police with his concerns. By pleading that damaging assertion, Mr Harmer breached his professional obligation not to misuse his privilege to make allegations under absolute privilege in Court documents. Mr Harmer knew that Mr Ashby had the right, if not the duty, to go to the police with any concerns he genuinely had about Mr Slipper’s use of Cabcharge vouchers. But, the pleading of Mr Ashby’s intention to do so had no legitimate forensic purpose. His inclusion of irrelevant assertion of Mr Ashby’s intention to go to the police in the originating application was an abuse of the process of the Court for the same reasons as was the submission of the barrister, Peter Clyne in open court that a solicitor, Mr Mann, had been guilty of professional misconduct. The High Court said of that in Clyne 104 CLR at 201:“If the solicitor [against whom Mr Clyne made the allegations] was guilty of misconduct, the proper course was to report him to the Law Institute. It is difficult to avoid the conclusion that the course adopted was chosen because of the opportunities which it offered for a public attack on Mr. Mann.” (emphasis added) Here, it is difficult to avoid the conclusion, that I draw, namely that the inclusion in the originating application of the assertion that Mr Ashby intended to report the Cabcharge allegations to the police, offered him and Mr Harmer the opportunity to make a more serious public attack on Mr Slipper than would have been the case merely by making the balance of the Cabcharge allegations. That attack, in the form it was made, was a misuse of Mr Harmer’s privilege as a lawyer. The use of the Court’s process to make that attack in that form was an abuse of process.The Genuine Steps Statement There was no basis for Mr Harmer to assert in the genuine steps statement that the matter was so urgent that genuine steps to resolve it could not have been undertaken before the proceedings were filed. The inclusion of the 2003 and Cabcharge allegations in the originating application certainly inflamed the matter, but that was Mr Ashby’s and Mr Harmer’s doing. The originating application did not make any allegation that Mr Ashby had been “victimised” in the period of more than two months after 1 February 2012. Moreover, the subsequently filed statement of claim pleaded no acts of victimisation. As at 20 April 2012, Mr Ashby was nowhere near ready to litigate the matter at a final hearing. The originating application pleaded that his damages claim for breach of contract would “be calculated following the receipt of expert medical evidence”. He only first attended on Dr Phillips on 19 June 2012, two months after the asserted urgency in the genuine steps statement. Mr Ashby had been actively intending to bring the proceedings since at least 26 March 2012, but only in his good time and after Mr Lewis had gone to press first (on 16 April 2012) with other allegations against Mr Slipper.

Ratio Decidendi

Legal Principle Established

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