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Dillon v RBS Group (Australia) Pty Ltd

Dillon v RBS Group (Australia) Pty Ltd

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FEDERAL COURT OF AUSTRALIA
Dillon v RBS Group (Australia) Pty Limited [2017] FCA 896

File number: NSD 1016 of 2014

Judge: LEE J

Date of judgment: 8 August 2017

Catchwords:
PRACTICE AND PROCEDURE – heterodox nature of ‘interim’ or ‘interlocutory’ declarations and consideration of when declarations can made other than at a final hearing – requirement of utility and extant justiciable controversy – declaratory relief refused

PRACTICE AND PROCEDURE – Part IVA representative proceedings – consumer class action – Merck orders concerning initial trial – accelerated adjudication of sample group member claim, common issues and ‘issues of commonality’ – the nature of a ‘claim’ within the meaning of s 33C of the Federal Court of Australia Act 1976 (Cth) and principled approach to composition of group membership –flexibility of Part IVA case management powers and relationship with the overarching purpose – determination of issues that do not arise on the claim of the representative applicant without the creation of sub-groups

Legislation:
Federal Court of Australia Act 1976 (Cth), ss 33C, 33C(1), 33C(1)(c), 33C(2)(a)(i), 33D, 33H, 33J, 33K, 33N, 33Q, 33R, 33S, 33T, 33W, 33X, 33ZA, 33ZB, 33ZC, 33ZC(1), 33ZE, 33ZF, 37M(3), 37P, 43(1A)

Federal Court Rules 2011 (Cth), rr 8.01, 8.05(b), 9.32, Schedule 1

Civil Procedure Act 2010 (Vic), ss 7, 9, 9(1)(c), 91(1)(d)

Cases cited:
Australian Competition and Consumer Commission v Giraffe World Australia Pty Limited [1998] FCA 819; (1998) 84 FCR 512

Australian Competition and Consumer Commission v MSY Technology Pty Ltd [2012] FCAFC 56; (2012) 201 FCR 378

AED Oil Ltd v Puffin FPSO Ltd [2010] VSCA 37; (2010) 27 VR 22

Allphones Retail Ltd v Weimann [2009] FCAFC 135

Banque Commerciale SA En Liquidation v Akhil Holdings Ltd [1990] HCA 11; (1990) 169 CLR 279

Clarke v Chadburn [1985] 1 WLR 78

Dorojay Pty Ltd v Aristocrat Leisure Limited (Federal Court of Australia, Proceedings No NSD 362 of 2004

Earglow Pty Limited v Newcrest Mining Limited [2015] FCA 328; (2015) 230 FCR 469

International General Electric Co of New York v Customs and Excise Commissioners [1962] Ch 784

Johnson Tiles Pty Ltd v Esso Australia Pty Ltd [2003] VSC 27; (2003) Aust Torts Reports 81-692

Johnson Tiles Pty Ltd v Esso Australia Pty Ltd (No 3) [2001] VSC 372

Kamasaee v Commonwealth of Australia (No 10) [2017] VSC 272

King v GIO Australia Holdings Limited [2000] FCA 617; (2000) 100 FCR 209

Kinsella v Gold Coast Council [2014] QSC 65; [2015] 1 Qd R 274

Kirby v Centro Properties Ltd (Federal Court of Australia, Proceedings No. VID 326 of 2008

Matthews v SPI Electricity Pty Ltd (Ruling 5) [2012] VSC 66; (2012) 35 VR 615

Merck Sharp & Dohme (Australia) Pty Ltd v Peterson [2009] FCAFC 26

Peterson v Merck Sharpe & Dohme (Australia) Pty Ltd (No 5) (2010) 87 IPR 234

Philip Morris (Australia) Ltd v Nixon [2000] FCA 229; (2000) 170 ALR 487

Re Estate of R D Firns [2001] NSWSC 184

Rodriguez &…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2017] FCA 896
Decision Date: 8 August 2017

CaseChat Overview and Summary

In Dillon v RBS Group (Australia) Pty Ltd, the applicants sought declaratory relief concerning their potential liability for costs if their claim failed. The dispute involved an application within a consumer class action under Part IVA of the Federal Court of Australia Act 1976 (Cth). The central legal issues focused on the appropriateness of making an interlocutory declaration, the scope of the initial trial, and the management of representative proceedings. The court had to determine whether such a declaration could be made outside a final hearing and whether it was appropriate to decide issues that did not directly pertain to the representative applicant's claim without creating sub-groups.

The court held that the sought declaration was not suitable for an interlocutory hearing because it did not address a real legal controversy but rather an abstract or hypothetical concern. The court emphasized that the exercise of judicial power at an initial trial should be principled and focused on concrete facts in issue. It also considered the broader case management powers available under Part IVA, highlighting the need for flexibility while adhering to the overarching purpose of the legislation. The court found that the declaration in question did not align with these principles and therefore declined to make it.

The court dismissed the interlocutory application seeking declaratory relief and made no order regarding the costs of the application. Additionally, the court extended various time limits for filing points of claim, defences, and standard discovery for the Sample Group Member. These orders facilitated the ongoing proceedings by allowing the Sample Group Member to join issues on additional claims and ensuring that all relevant evidence was properly disclosed.

Orders

Orders of the court

1. The applicants’ interlocutory application dated 17 July 2017 (and filed on 18 July 2017) be dismissed.

2. There be no order as to the costs of the interlocutory application.

3. The time for the Sample Group Member to file and serve points of claim which, to the extent possible, is to incorporate by reference, allegations made in the second amended statement of claim but supplement those allegations with the individual factual and legal contentions made by the Sample Group Member, be extended to 11 August 2017.

4. The time for the respondents to file and serve points of defence in relation to the points of claim filed by the Sample Group Member, be extended to 25 August 2017.

5. The time for the Sample Group Member to file and serve any reply to the points of defence, be extended to 1 September 2017.

6. The time for the Sample Group Member to give standard discovery as required by order 19 made on 15 June 2017, and to provide electronic copies of the documents discovered in Part 1 of the list of documents, be extended to 11 August 2017.

7. The time for the applicants and Sample Group Member to serve lay affidavit evidence upon which they intend to rely at the initial trial be extended to 11 August 2017.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

The boundaries of what can be determined at the initial trial are the boundaries of the principled exercise of judicial power, being questions or facts in issue which are neither abstract nor hypothetical. Case management imperatives, procedural fairness and the mandate of the overarching purpose inform what should be determined. This approach informed the issues selected to be determined in this case, as reflected in Schedule 2 to the Initial Trial Orders. E CONCLUSION AND ORDERS An order should be made dismissing the interlocutory application seeking declaratory relief. There should be no order as to costs. The parties have agreed on further orders as to the determination of any Sample Group Member’s claim, which I will also make. As I indicated at [13] above, these orders provide for service of points of claim and points of defence allowing for a joinder of issue on the additional claim. They also provide for standard discovery to be made by the Sample Group Member.

Ratio Decidendi

Legal Principle Established

The balance of these reasons will be structured as follows:·Part B: Why the Declaration Should not be Made;·Part C: The Three Relevant Contested Issues; ·Part D: The Initial Trial Orders;·Part E: Conclusion and Orders.B WHY THE DECLARATION SHOULD NOT BE MADE In support of the proposed order sought, junior Counsel for the applicants, Mr Rares, helpfully referred me to Matthews v SPI Electricity Pty Ltd (Ruling 5) [2012] VSC 66; (2012) 35 VR 615, where J Forrest J, at 625 [43], made a declaration as to the potential costs liability of a Sample Group Member, describing the making of an order which provided finality as “a practical and sensible suggestion designed to facilitate a decision by the Sample Group Members as to whether to participate in the trial”: at 623 [34]. In summary, his Honour held that: (a)those group members contemplating engaging in the process should not be left in the dark and should know whether, like the applicant, if their claim failed, they would be at risk of the application that costs follow the event; (b)in Johnson Tiles Pty Ltd v Esso Australia Pty Ltd (No 3) [2001] VSC 372, Gillard J ruled against a contention that a Sample Group Member ought to be exposed to an order for costs in the event that the group member’s claim failed. In doing so, his Honour determined that the relevant legislative provisions prevented a sample group member being liable for adverse costs; and(c)it was neither inappropriate nor beyond the power of the Court to make an interlocutory declaration as sought because: (i) of the breadth of the power contained in s 33ZF; and (ii) it was in the interests of justice to ensure that sample group members are aware of the costs consequences of their participation. For my part, despite the broad nature of the power contained in s 33ZF, I am not prepared to grant the relief in this case because the order sought is a form of relief which is not directed to the final determination of a real legal controversy. This statement requires some elaboration. The first issue to be considered is what was described by the applicants as the ‘interlocutory’ nature of the declaration (although, for reasons I will explain, I think this description, in the present case, is a misnomer). In Graham Barclay Oysters Pty Ltd v Ryan [2002] HCA 54; (2002) 211 CLR 540, a final judgment at an initial trial was entered in relation to the individual claim of the representative applicant but the primary judge went on to make a declaration in connexion with claims of group members. Put another way, the Court purported to make an interlocutory order in the form of a declaration affecting the rights of the respondent and group members. In noting that the making of such a declaration was “wrong”, Gummow and Hayne JJ said (at 590 [128]) that an: “(i)nterlocutory declaration” is a form of order not known to the law ...” The same point was made in another representative proceeding by Hayne and Callinan JJ in Dovuro Pty Ltd v Wilkins [2003] HCA 51; (2003) 215 CLR 317 at 363 [143].

File number:	NSD 1016 of 2014
Judge:	LEE J
Date of judgment:	8 August 2017
Catchwords:	PRACTICE AND PROCEDURE – heterodox nature of ‘interim’ or ‘interlocutory’ declarations and consideration of when declarations can made other than at a final hearing – requirement of utility and extant justiciable controversy – declaratory relief refused PRACTICE AND PROCEDURE – Part IVA representative proceedings – consumer class action – Merck orders concerning initial trial – accelerated adjudication of sample group member claim, common issues and ‘issues of commonality’ – the nature of a ‘claim’ within the meaning of s 33C of the Federal Court of Australia Act 1976 (Cth) and principled approach to composition of group membership –flexibility of Part IVA case management powers and relationship with the overarching purpose – determination of issues that do not arise on the claim of the representative applicant without the creation of sub-groups
Legislation:	Federal Court of Australia Act 1976 (Cth), ss 33C, 33C(1), 33C(1)(c), 33C(2)(a)(i), 33D, 33H, 33J, 33K, 33N, 33Q, 33R, 33S, 33T, 33W, 33X, 33ZA, 33ZB, 33ZC, 33ZC(1), 33ZE, 33ZF, 37M(3), 37P, 43(1A) Federal Court Rules 2011 (Cth), rr 8.01, 8.05(b), 9.32, Schedule 1 Civil Procedure Act 2010 (Vic), ss 7, 9, 9(1)(c), 91(1)(d)
Cases cited:	Australian Competition and Consumer Commission v Giraffe World Australia Pty Limited [1998] FCA 819; (1998) 84 FCR 512 Australian Competition and Consumer Commission v MSY Technology Pty Ltd [2012] FCAFC 56; (2012) 201 FCR 378 AED Oil Ltd v Puffin FPSO Ltd [2010] VSCA 37; (2010) 27 VR 22 Allphones Retail Ltd v Weimann [2009] FCAFC 135 Banque Commerciale SA En Liquidation v Akhil Holdings Ltd [1990] HCA 11; (1990) 169 CLR 279 Clarke v Chadburn [1985] 1 WLR 78 Dorojay Pty Ltd v Aristocrat Leisure Limited (Federal Court of Australia, Proceedings No NSD 362 of 2004 Earglow Pty Limited v Newcrest Mining Limited [2015] FCA 328; (2015) 230 FCR 469 International General Electric Co of New York v Customs and Excise Commissioners [1962] Ch 784 Johnson Tiles Pty Ltd v Esso Australia Pty Ltd [2003] VSC 27; (2003) Aust Torts Reports 81-692 Johnson Tiles Pty Ltd v Esso Australia Pty Ltd (No 3) [2001] VSC 372 Kamasaee v Commonwealth of Australia (No 10) [2017] VSC 272 King v GIO Australia Holdings Limited [2000] FCA 617; (2000) 100 FCR 209 Kinsella v Gold Coast Council [2014] QSC 65; [2015] 1 Qd R 274 Kirby v Centro Properties Ltd (Federal Court of Australia, Proceedings No. VID 326 of 2008 Matthews v SPI Electricity Pty Ltd (Ruling 5) [2012] VSC 66; (2012) 35 VR 615 Merck Sharp & Dohme (Australia) Pty Ltd v Peterson [2009] FCAFC 26 Peterson v Merck Sharpe & Dohme (Australia) Pty Ltd (No 5) (2010) 87 IPR 234 Philip Morris (Australia) Ltd v Nixon [2000] FCA 229; (2000) 170 ALR 487 Re Estate of R D Firns [2001] NSWSC 184 Rodriguez &…