Diz18 (by her litigation representative Dja18) v Minister for Home Affairs (No 3)

Case [2023] FCA 1350

FEDERAL COURT OF AUSTRALIA

DIZ18 (by her litigation representative DJA18) (No 3) v Minister for Home Affairs [2023] FCA 1350

File number(s): VID 776 of 2018
Judgment of: MURPHY J
Date of judgment: 3 November 2023
Catchwords: NEGLIGENCE – claim alleging breach of duty of care in relation to medical treatment of a child detained on Nauru – application by litigation representative for approval of an infant’s compromise under r 9.70 of the Federal Court Rules 2011 – whether settlement is in the best interests of the infant -– whether suppression and non-publication orders are necessary to prevent prejudice to the administration of justice – settlement approved
Legislation:

Federal Court of Australia Act 1975 (Cth) ss 37AF, 37A

Migration Act 1958 (Cth)

Federal Court Rules 2011 r 9.70
Cases cited:

Baltic Shipping Co v Dillon [1991] NSWCA 19; 22 NSWLR 1

Bannister v State of Victoria [2012] FCA 1341

Bushby (by his litigation representative Webling) v Victoria (Department of Education and Training) (No 2) [2023] FCA 34

Cannon v Griffiths & Ors (No 2) [2015] NSWSC 1329

DIZ18 (by her litigation representative DJA18) v Minister for Home Affairs (No 2) [2022] FCA 898

DJA18 as litigation representative for DIZ18 v Minister for Home Affairs [2018] FCA 1050

Elliot v State of Victoria (Department of Education & Training) [2018] FCA 1029

Elliott v State of Victoria [2018] FCA 1029

Fisher v Marin [2008] NSWSC 1357

Freeman v State of Victoria [2018] FCA 797

FRM17 v Minister for Home Affairs [2019] FCAFC 148; 271 FCR 254

Gray v State of Victoria (Department of Education and Early Childhood Development) [2017] FCA 353

James v WorkPower Inc [2019] FCA 1239

Minister for Home Affairs v DMA18 as litigation guardian for DLZ18 [2020] HCA 43; 270 CLR 372

Modra v State of Victoria [2013] FCA 1041

Oldham v Capgemini Australia Pty Ltd(No 2) [2016] FCA 1101

Rinehart v Welker [2011] NSWCA 403

Scandolera v State of Victoria [2015] FCA 1451; 331 ALR 525
Division: General Division
Registry: Victoria
National Practice Area: Other Federal Jurisdiction
Number of paragraphs: 68
Date of last submission/s: 20 September 2023
Date of hearing: Determined on the papers
Counsel for the Applicant: Ms F A Ryan SC and Ms S Gold
Solicitor for the Applicant: Maurice Blackburn Lawyers
Counsel for the Respondents: Mr M D Rush, Mr B Jellis and Mr T Katz
Solicitor for the Respondents: Australian Government Solicitor

ORDERS

VID 776 of 2018
BETWEEN:

DIZ18 (BY HER LITIGATION REPRESENTATIVE DJA18)

Applicant
AND:

MINISTER FOR HOME AFFAIRS

First Respondent

COMMONWEALTH OF AUSTRALIA

Second Respondent

ORDER MADE BY:

MURPHY J

DATE OF ORDER:

3 NOVEMBER 2023

THE COURT NOTES THAT:

A.The Applicant was born on 5 June 2016 and is a person under a legal incapacity within the meaning of Schedule 1 of the Federal Court Rules 2011 (the Rules).

B.The Applicant commenced this proceeding by her litigation guardian DJA18, by way of Originating Application and Statement of Claim dated 29 June 2018.

C.The parties…

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AGLC
Diz18 (by her litigation representative Dja18) v Minister for Home Affairs (No 3) [2023] FCA 1350
Case
[2023] FCA 1350
Decision Date

CaseChat Overview and Summary

Diz18, represented by her litigation representative Dja18, brought a claim against the Minister for Home Affairs, alleging a breach of duty of care in relation to medical treatment provided to the applicant while detained on Nauru. The case was before the Federal Court of Australia, which had to decide whether to approve the settlement of the claim and whether confidentiality orders were necessary to prevent prejudice to the administration of justice.

The primary legal issue was whether the settlement was in the best interests of the infant applicant and whether the confidentiality orders were necessary to prevent prejudice to the administration of justice. The court considered the applicant's agreement to the settlement, the novel and contestable nature of the claims, and the confidential opinion provided by experienced counsel. The court also examined the proposed preservation of the settlement sum to ensure it would be used for the applicant's benefit.

The Federal Court approved the settlement, finding it to be in the best interests of the infant applicant. The court was satisfied that the applicant, through her father, had given informed consent to the settlement after receiving legal advice. The court also found that the settlement was reasonable, considering the novel legal issues and the significant differences in the parties' positions. The court placed substantial weight on the confidential opinion of counsel, who had carefully considered the medical evidence, risks of liability, and potential recovery for the applicant. Regarding the confidentiality orders, the court found them necessary to protect the confidentiality of the settlement terms and the negotiation process, as well as to encourage future consensual resolutions.

The court made orders approving the proposed settlement and granting confidentiality orders for specific documents and the settlement amount itself. The settlement sum was to be held in trust for the applicant's benefit. The court also ordered that the proceeding be dismissed and that the respondents pay the applicant's costs as agreed or taxed in default of agreement.

Orders

Orders of the court

Settlement Approval

1. The Applicant is granted leave to file an amended Originating Application substantially in the form of Schedule A to her Interlocutory Application dated 19 July 2023.

2. The settlement set out in the Deed be approved.

3. Within two (2) days of the making of these orders the Applicant shall send these orders, and (subject to Orders 7 and 8 below) the affidavits filed in support of the settlement approval application to the Senior Master of the Supreme Court of Victoria (SCV).

4. If the Senior Master of the SCV makes an order under r 79.10(2) of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) that the Settlement Sum (as defined in the Deed) be held in Court for the benefit of the Applicant, the Respondent shall pay the Settlement Sum to the trust account of the Applicant’s solicitors for the benefit of the Applicant.

5. If the Senior Master of the SCV does not make the order described in Order 4 above, within 28 days of this order, the matter be listed for case management hearing on a date to be fixed.

6. Within five (5) business days of payment of the Settlement Sum, the parties will file consent orders with the Court, providing that:

(a) the proceeding be dismissed; and

(b) the Respondents pay the Applicant’s costs as agreed or taxed in default of agreement.

Confidentiality

7. Until 3 November 2026 or further order, pursuant to ss 37AF and 37AG of the Federal Court of Australia Act 1976 (Cth) (the Act) and on the ground that it is necessary to prevent prejudice to the proper administration of justice, the Deed of Settlement being “Annexure BM-4” to the affidavit of Bridie Murphy affirmed 13 July 2023, be treated as confidential to the parties to this proceeding, be marked as confidential to the parties on the Court’s Electronic Court File, and not be available for public inspection, disclosed in open court or disclosed in the open part of any court transcript.

8. Until further order, pursuant to ss 37AF and 37AG of the Act and on the ground that it is necessary to prevent prejudice to the proper administration of justice, the following documents be treated as confidential to the parties to this proceeding, be marked as confidential to the parties on the Court’s Electronic Court File, and not be available for public inspection, disclosed in open court or disclosed in the open part of the transcript of any court proceeding:

(a) the following annexures to the affidavit of Bridie Murphy affirmed 13 July 2023:

(i) the bundle of medical reports filed and served on behalf of the applicant being “Annexure BM-1”;

(ii) the bundle of medical reports filed and served on behalf of the respondents being “Annexure BM-2”;

(iii) the confidential opinion of Fiona Ryan SC and Stella Gold of counsel dated 11 July 2023 being “Annexure BM-5”;

(iv) the correspondence between the Applicant’s solicitors and Medicare being “Annexure BM-7”; and

(v) the letter from the applicant’s solicitors to the Supreme Court of Victoria - Funds in Court dated 5 May 2023 being “Annexure BM-8”; and

(b) all medical reports filed by the Respondents in the proceeding.

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

Background

Background to the litigation

For the reasons I now turn to explain, it is appropriate to approve the settlement and to make the confidentiality orders sought, but to limit the time period for which the confidentiality orders will operate. FACTUAL AND PROCEDURAL BACKGROUND The applicant’s parents are citizens of Iran who arrived Australia, by boat, without a visa, in September 2013. They are therefore “unlawful maritime arrivals” as defined in the Migration Act 1958 (Cth) (the Act) and at the direction of the respondents, the Minister for Home Affairs and the Commonwealth of Australia, they were taken to Nauru where they were detained in immigration detention. On 5 June 2016, the applicant was born on Nauru. The applicant’s parents and the applicant were subsequently recognised by the Nauruan government as refugees, and until they were brought to Australia pursuant to orders made in this proceeding on 3 July 2018, they lived on Nauru under temporary settlement visas granted by that government.The applicant’s condition and medical treatment The following history is drawn from my decision in DJA18 as litigation representative for DIZ18 v Minister for Home Affairs [2018] FCA 1050. It is not clear to me whether, or the extent to which, that history is contested by the respondents, and it should be understood as the applicant’s claims rather than as findings. The applicant fell ill on 7 June 2018, two days after her second birthday. She was taken by her parents to the International Health and Medical Services (IHMS) clinic, the medical service contracted to provide healthcare to detainees and refugees on Nauru, where she was prescribed paracetamol syrup to take every four hours. On 11 June 2018 the applicant’s symptoms became significantly worse and she was again taken to the IHMS clinic, where she presented with symptoms of mouth lesions, fever, irritability and dehydration. She was given fluid via an intra osseous needle in her left tibia and remained in a back room of the IHMS clinic for observation and medical management until 12 June 2018. On 12 June 2018 the intra osseous line was removed and the applicant was taken by ambulance to the Republic of Nauru Hospital where a central line was inserted into the applicant under general anaesthetic. She was not admitted to hospital. On 12 June, IHMS consulted Dr John Field, an Emergency Physician and Intensive Care Specialist in Australia, by telephone. He provided a report which briefly noted the applicant’s history and symptoms and said “I am very concerned this represents severe sepsis which carries a high mortality.” Dr Field recommended a course of medication and “urgent evacuation to a first world tertiary hospital”. The same day Dr Shane George, a Paediatric Emergency Physician in Australia, provided a report assessing the applicant’s condition. His report noted “a history and clinical features of severe sepsis, and concerns of a central nervous system source” and said that “meningo-encephalitis is suspected”.

Evidence

Evidence Before The Court

The applicant also seeks confidentiality orders in respect of:(a)some of the annexures to Ms Murphy’s affidavit, namely;(i)the bundles of medical reports which are “Annexures BM-1 and BM-2”;(ii)the Confidential Opinion which is “Annexure BM-5”;(iii)the correspondence between the solicitors for the applicant and Medicare which is “Annexure BM-7”;(iv)the correspondence between the solicitors for the applicant and SCV Funds in Court which is “Annexure BM-8”; and(b)all medical reports filed by the respondents in the proceeding.I also made interim confidentiality orders in relation to that material on 18 August 2023.The evidence The respondents filed written submissions in support of confidentiality orders dated 8 September 2023 and the applicants filed written submissions on the question dated 13 September 2023.Consideration The application for a confidentiality order is made under s 37AG(1) of the FCA on the basis that the order is “necessary to prevent prejudice to the proper administration of justice”. As I said in Gray v State of Victoria (Department of Education and Early Childhood Development) [2017] FCA 353 at [21]-[22]:The use of the word “necessary” in s 37AG(1)(a) indicates a reasonably strict test: Hogan v Australian Crime Commission (2010) 240 CLR 651; [2010] HCA 21 at [30] (French CJ, Gummow, Hayne, Heydon and Kiefel JJ) in relation to a predecessor provision; Rinehart v Welker [2011] NSWCA 403 (Rinehart) at [27] (Bathurst CJ and McColl JA) and at [105]-[106] (Young JA).The concept of the administration of justice is multi-faceted: Rinehart at [39].It incorporates:(a)the public interest in the preservation of the confidentiality of the mediation process and the process of negotiation of the settlement of litigation: Sharjade Pty Ltd v RAAF (Landings) Ex-Servicemen Charitable Fund Pty Ltd [2008] NSWSC 1347 at [34] (Bergin J); Cannon v Griffiths & Ors (No 2) [2015] NSWSC 1329 at [14] (Beech-Jones J);(b)the public interest in keeping people to their freely-entered bargain: Baltic Shipping Co v Dillon [1991] NSWCA 19; 22 NSWLR 1 at 9 (Gleeson CJ);(c)the public interest in the settlement of proceedings prior to trial: Oldham v Capgemini Australia Pty Ltd(No 2) [2016] FCA 1101 at [24] (Mortimer J); Reynolds v JP Morgan Administrative Services Australia Limited (No 2) (2011) 193 FCR 507; [2011] FCA 489 at [30] (Rares J). The Court has been satisfied that it is appropriate to make orders to protect the confidentiality of the terms of settlement of a proceeding brought by a person under a legal incapacity, and the confidential opinion of counsel in support of a settlement approval application, for reasons including the following:(a)the likelihood that a settlement would not have occurred without the prospect of such protection: Elliott v State of Victoria [2018] FCA 1029 at [24] (Mortimer J, as her Honour then was); James v WorkPower Inc [2019] FCA 1239 at [18] (Mortimer J, as her Honour then was). Bushby (by his litigation representative Webling) v Victoria (Department of Education and Training) (No 2) [2023] FCA 34 at [25] (McEvoy J);(b)so that future parties, that is, not the parties in the proceeding before the Court, can have confidence that the Court may be prepared to facilitate resolution of such proceedings, including by orders for confidentiality as to the terms of settlement and counsel’s opinion in support of settlement approval: Elliott at [18]; James at [18]; Bushby at [25];(c)the conserving of the parties’ and the Courts resources by the facilitation of consensual resolution: Elliott at [24]; and(d)bringing finality to the litigation; Elliott at [24].

Decision

Reasons for decision

Finally, I can see no basis for the respondents’ application for orders that paragraph 12 of the affidavit of Mr Lukic and subparagraphs 6(a) and (b) of the respondent’s written submissions be ordered to be confidential. Paragraph 12 of Mr Lukic’s affidavit says no more than that the Deed provides that its terms be confidential. The same can be said of subparagraphs 6(a) and (b) of the respondent’s written submissions. The fact that the Deed provides that its terms be confidential is one of the reasons why I have decided to approve the confidentiality orders sought. And I have said so in these reasons. In such circumstances it cannot sensibly be said that it is necessary to prevent prejudice to the administration of justice that it be kept confidential that the settlement terms are confidential.CONCLUSION I have made orders to approve the proposed settlement, and for the terms of the Deed including the settlement amount to be kept confidential for three years, as well as orders for the Confidential Opinion and various annexures to the affidavit of the applicant’s solicitor to be kept confidential without a time limitation.

Ratio Decidendi

Legal Principle Established

Another important consideration is how the settlement sum is to be preserved for the applicant’s benefit. Unless preservation of the settlement sum can be achieved the Court may have doubt about whether the settlement proposal is beneficial. To avoid the possibility of dissipation it may be appropriate for the sum to be held securely in trust and applied toward the applicant’s educational, developmental or health interests: Scandolera at [32]; Freeman v State of Victoria [2018] FCA 797 at [12] (Moshinksy J).Consideration For the following reasons I am satisfied that the proposed settlement is within the range of reasonable outcomes of the proceeding, and in the applicant’s best interests. It is appropriate to approve the settlement. First, the applicant, through her father as litigation representative, has agreed to the proposed settlement having had the benefit of legal advice from experienced and competent lawyers, and having read the Confidential Opinion. The applicant’s father is in a good position to understand what is in his daughter’s best interests. Second, having regard to the statutory context in which the applicant’s claim arises, her claims as to the existence and breach of a non-delegable, or in the alternative a delegable, duty to provide reasonable medical care are novel and contestable. Further, having regard to the medical reports annexed to Ms Murphy’s affidavit there are some significant differences between the parties on some of the factual questions in the case. Those matters too are contestable. The claim has been strenuously defended to date, and if settlement is not approved it seems likely that will continue. The proceeding has already been on foot for more than five years and even if heard in the first half of next year it will have been six years before it is determined. Then, there is a prospect of an appeal due to the novel legal issues in dispute. Third, I have had the benefit of considering the Confidential Opinion of Fiona Ryan SC and Stella Gold of counsel dated 11 July 2023. Both Ms Ryan and Ms Gold have been briefed in the case for a lengthy period and the opinion shows they have a detailed knowledge of the issues and the evidence in the case. I cannot go to the detail of the Confidential Opinion and it must suffice to note that counsel gave careful consideration to the medical evidence, the risks on liability, the risks in relation to quantum, and the best possible recovery for the applicant. Counsel concluded that the proposed settlement is reasonable in all the circumstances and is in the applicant’s best interests. Counsel provided the Confidential Opinion to assist the Court in its protective function, as distinct from acting as an advocate upon their client’s instructions (Bannister v State of Victoria [2012] FCA 1341 at [12] (Murphy J)) and it is appropriate to give substantial weight to it. Fourth, with respect to preservation of the settlement sum, it is proposed that the funds be paid into the trust account of the applicant’s solicitor, and thereafter be transferred to the Funds in Court division of the Supreme Court of Victoria (SCV) on the applicant’s behalf. In her affidavit Ms Murphy deposes to the enquiries made by Maurice Blackburn Lawyers as to the SCV’s preparedness to receive the funds and the Office of the Senior Master of the Funds and the Court’s explicit advice about the wording of an order to be made by this Court so as to give effect to the arrangement.