Elston v Commonwealth of Australia

[2014] HCATrans 297

[2014] HCATrans 297

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Brisbane  No B38 of 2014

B e t w e e n -

DR GUY N ELSTON

Applicant

and

COMMONWEALTH OF AUSTRALIA

Respondent

Summons for reinstatement

KIEFEL J

TRANSCRIPT OF PROCEEDINGS

AT BRISBANE ON TUESDAY, 16 DECEMBER 2014, AT 10.13 AM

Copyright in the High Court of Australia

MR G.N. ELSTON appeared in person.

MR P.G. BICKFORD:   May it please the Court, your Honour, I appear for the respondent.  (instructed by Clayton Utz)

HER HONOUR:   Thank you.  I have read the summons for reinstatement and the affidavit material in support, together with the written submissions which the parties have provided.  Dr Elston, in relation to your written submissions, one of the matters that you do not really deal with is identifying any error in the decision of Justice Katzmann on the application for security for costs.  You have directed your attention really to the question of whether or not the substantive proceedings have some merit, but that is probably not an issue that is necessarily got to on this application because the question is whether or not an application for special leave from the order for security for costs has some prospects of success, rather than whether or not the substantive action does.  So if you would like to address that more narrow issue about the order for security for costs, I think you might be wise to supplement your written submissions orally if you are able to.

MR ELSTON:   Thank you, your Honour.  I can perhaps best focus on that particular issue by referring to the finding of the Court of Chancery Cowell v Taylor (1885) and I was hoping that this honourable Court in the circumstances of this case would resort to equity and the principles of equity.

HER HONOUR:   In what way?

MR ELSTON:   Your Honour, my financial position, I believe the evidence shows the Court, is a result of the actions of the defendants.  You may or may not remember, your Honour, when I was before you in 2011 ‑ ‑ ‑

HER HONOUR:   On the remitter, yes.

MR ELSTON:   ‑ ‑ ‑ I did make some comments in respect to the practical difficulties in my particular circumstances of passaging this matter through the court system.

HER HONOUR:   The submission that you are making is one that is often made in relation to applications for security for costs because people say “I cannot pay security for costs, I am not in a position to because of the conduct of the other side” and so the judge on the application for security for costs has a look at the likelihood of success on the appeal because the fact is by that point that there is a judgment in favour of the other party, so the question becomes ‑ the focus of the court’s attention becomes on whether or not there are some prospects of appeal – on the appeal in relation to that judgment.

MR ELSTON:   Prospects of success on the appeal.

HER HONOUR:   On the substantive appeal.  So that is what the court on an application for security for costs has to do, and Justice Katzmann in this case did turn her mind to that for the very reason that you are now submitting, that you are saying it was their conduct, their wrongful conduct which put you in this position.  Well, that means they have a judgment in their favour which suggests their conduct was not wrongful and the judge looks at whether or not there is a prospect that that might be overturned on appeal.  That is the way the courts balance the positions of the two parties.

MR ELSTON:   Well, your Honour, specifically on the application for special leave, the orders of Katzmann, that is the substantive appeal we are talking about?  Is that correct?

HER HONOUR:   On the order for security for costs.

MR ELSTON:   That is right, yes, of Justice Katzmann.

HER HONOUR:   The application before her Honour was the application for security for costs.

MR ELSTON:   Yes.

HER HONOUR:   Yes.

MR ELSTON:   Well, as I argued before Justice Katzmann, the honourable Justice Dowsett identified that the court had not disposed of all causes of action as seen on the face of the writ issued by the High Court.  Therein he identified a failing on the part of the lower court, your Honour, as I see it.  As I understand the High Court Rules an appeal can then be – I beg your pardon, the Federal Court Rules, at that point – an appeal can then be made on two grounds - in particular, that the orders are oppressive or they subvert the interests of the administration of justice.  So, in terms of the chronology, your Honour, as I see it, Justice Rangiah made his determination, Justice Dowsett identified shortcomings in the determination insofar as ‑ ‑ ‑

HER HONOUR:   Where do you say Justice Dowsett identified shortcomings?

MR ELSTON:   I have a copy of the transcript of the hearing if you would like me to hand it up, your Honour.  He essentially ‑ ‑ ‑

HER HONOUR:   Well, his Honour did not give – this is just in passing, in conversation in court?

MR ELSTON:   No, in court, your Honour.

HER HONOUR:   Yes.

MR ELSTON:   At the appeal of the determination of Justice Rangiah before ‑ ‑ ‑

HER HONOUR:   This is when Justice Dowsett set the matter down for hearing?

MR ELSTON:   That is correct, your Honour.

HER HONOUR:   He gave a hearing date or a sittings ‑ ‑ ‑

MR ELSTON:   A date to be fixed at that point, yes.

HER HONOUR:   Yes.

MR ELSTON:   Justice Dowsett identified that there were problems.  I can go straight to his comments on the record if I can hand up the transcript, your Honour.  I can go straight to the page.

HER HONOUR:   Well, if you want to, but I should indicate to you that what judges say in court in passing is not particularly influential if they are not saying them in reasons, in reasons in a judgment, but if you wish to hand it up to me I will certainly look at it.

MR ELSTON:   I could perhaps cut straight to the chase then, your Honour, and put it this way.  I see that the Court has not made a determination in respect of the cause of action of defamation seen on the face of the writ issued by this honourable Court in 2011.  Justice Dowsett identified that and some other administrative failings ‑ if I can put it that way, your Honour – was also informed of my financial position.  I freely informed the court of my financial position and then Justice Dowsett ordered the matter to a hearing before the Full Bench at a date to be fixed.  A date was fixed on 8 August of this year.

The Commonwealth of Australia then by way of interlocutory application sought that I pay costs into court in the advent that an adverse costs order was made against me.  The very next day the Commonwealth took action to freeze my bank accounts in Australia.

HER HONOUR:   If you wish to pass up what Justice Dowsett said, feel free to.

MR ELSTON:   Thank you, your Honour.  I have a copy here for the Court and a copy for Mr Bickford.

HER HONOUR:   Did Justice Katzmann deal with the question of defamation, a defamation aspect?

MR ELSTON:   I do not believe so, your Honour.

HER HONOUR:   Where is the – can you direct me to what Justice Dowsett said?

MR ELSTON:   Yes, certainly.  The dialogue on it starts on page 10, your Honour, line 20 or so.  No, I do beg your pardon - I have missed one of my tabs here.  Page 8, your Honour, line 10 - would you like me to read that out?  It goes – I have pretty well highlighted everything from line 10, beginning:

HIS HONOUR:   Mr Bickford, if more relief were claimed in the writ –

through to halfway down on page 9, the following page.  The discussion does continue on, your Honour, through ‑ ‑ ‑

HER HONOUR:   I am afraid I cannot quite see what you see in those remarks.

MR ELSTON:   Yes, as I say, your Honour, the discussion does continue on.

HER HONOUR:   Whereabouts?

MR ELSTON:   Then page 11, line 28 or so:

HIS HONOUR:   Did his Honour deal with a claim for damages for defamation?

MR BICKFORD:   He dealt with damages.

HIS HONOUR:   Well, how –

Would you like – would you prefer to read it yourself rather than me read it out, your Honour?  Through to the next page – to the top of the first paragraph, page 13, your Honour, in particular, lines 32 through 36,

your Honour, page 12.  He does then, your Honour, from line 40 on page 12 make some comments as to how the matter might proceed through the Full Court and, indeed, this honourable Court, your Honour.

HER HONOUR:   So what did Justice Katzmann say about the claim for defamation?

MR ELSTON:   From memory, your Honour, and I do not have the transcript in front of me, the ‑ ‑ ‑

HER HONOUR:   I am just reading – it should appear in her Honour’s reasons ‑ I am just reading paragraph 56:

Dr Elston maintains defamation was a live issue ‑ ‑ ‑

MR ELSTON:   Yes, thank you for refreshing my memory.

HER HONOUR:   Is that the extent ‑ ‑ ‑

MR ELSTON:   Justice Katzmann did not see it the way that Justice Dowsett saw it, your Honour, as I recall.

HER HONOUR:   Yes.  Is there anything further you wish to add?

MR ELSTON:   I cannot think of anything at this point in time, your Honour.

HER HONOUR:   All right.  Thank you, Dr Elston.  Yes, Mr Bickford.

MR BICKFORD:   Yes, thank you, your Honour.  The matter of defamation was dealt with by her Honour Justice Katzmann, as your Honour has noted, at paragraph 56.

HER HONOUR:   Well, what do you say that means?

MR BICKFORD:   I am just turning up her Honour’s reasons, your Honour.

HER HONOUR:   Is it because Justice Logan did not identify it as one of the four issues to proceed to trial?

MR BICKFORD:   Yes, and that is also the basis upon which Justice Rangiah dealt with it.

HER HONOUR:   Dealt with it.  But as Justice Dowsett pointed out, Justice Logan had not dismissed that aspect of the claim, it remained live.

MR BICKFORD:   No, but ultimately Justice Rangiah dismissed the application with costs.  Now, the writ once it went back ‑ ‑ ‑

HER HONOUR:   But he has not dealt with in his reasons.

MR BICKFORD:   Has not dealt with any defamation issue, but that was not an issue that was before him, other than there was evidence about ‑ ‑ ‑

HER HONOUR:   As you would appreciate, Mr Bickford, the difficulty that that creates is that Justice Katzmann may not have – the question of prospects of success on the application for special leave in relation to security for costs raises the question of whether Justice Katzmann gave consideration to his prospects of appeal on the substantive application.  Her Honour did but it may be that her Honour did not give full consideration to his prospects, and it is the prospects of success on the substantive application which really founds the decision for security for costs.

MR BICKFORD:   That is correct, but her Honour did deal with how the matter came before Justice Rangiah and some submissions that were made by Dr Elston below at paragraphs 35 to 36 of her reasons.

HER HONOUR:   Yes.

MR BICKFORD:   His Honour Justice Logan had dealt with the defamation issue as having no prospects of success and that is why it was not one of the matters which was advanced for trial - one of the issues identified and advanced for trial.  As your Honour notes, it is an unusual way to proceed with the matter but his Honour Justice Logan did it because Dr Elston had had, I think, three goes at pleading – all of which have been struck out.

HER HONOUR:   Yes, I understand that.

MR BICKFORD:   Sometimes judges do proceed in this way.  There have been a few precedents.  Justice Logan did not give any reasons for proceeding in this way on this occasion.  Other than what he said in the transcript - which is not before your Honour – he did indicate he would give written reasons if requested, but they were not requested, a matter which I have had cause to regret since.  That is the way it proceeded.  Justice Rangiah did have material about it – I am just trying to find it in his reasons where he mentioned it.  Yes, your Honour, do you have Justice Rangiah’s decision and reasons?

HER HONOUR:   Yes.

MR BICKFORD:   It is reported at 222 FCR 429.

HER HONOUR:   Yes.

MR BICKFORD:   If I take your Honour to paragraphs 48 to 51 ‑ ‑ ‑

HER HONOUR:   This is a question that is dealt with as a question of causation for damages.

MR BICKFORD:   Yes, but that was the issue it seems that was the subject of the general allegation of defamation although it was never properly pleaded and notwithstanding the other complaints made by Dr Elston and the four issues that went for trial under the heading “Other matters” at page 443 your Honour will see that Justice Rangiah then dealt with the other issues raised by Dr Elston in any event.  There was argument before Justice Katzmann about these issues, although it does not find any expression in her Honour’s reasons so I cannot say anything more about that because I do not have the transcript here with me today, but her Honour’s attention was drawn to the remarks of Justice Dowsett, as I recollect it, certainly.

HER HONOUR:   I see.

MR BICKFORD:   Thank you, your Honour.

HER HONOUR:   Thank you.  Do you wish to say anything in response, Dr Elston?

MR ELSTON:   Yes, thank you, your Honour, particularly in relation to defamation before Justice Logan, your Honour.  My recollection of the day in court was, as I guess is usually the case, your Honour, there was an evolving discussion.  Justice Logan did at one point say to me in respect of the causes of action of defamation and breach of deed of agreement “I’m not going to not hear you on that today”.  Sorry, “I’m not going to not hear you on that, but I’m not going to hear you today.  You may well end up in a position where you can bring those matters before the hearing.”

On the four issues that Justice Logan then set down for trial, your Honour, my understanding on the day was that the proceeding would passage on those four issues, but I did not take that, your Honour, to mean that – the meaning to be proceeding would proceed solely on those four issues.  As I understood the evolving discussion in court, your Honour, his Honour identified, as he put it from memory, a particular legal point of interest focused on those, but on the day did not deal with the other causes

of action seen on the writ issued by this honourable Court.  As he said, he would not deal with them on that day.

I then proceeded on my understanding, your Honour, that that matter passage – or the proceeding passage on those four issues, but not solely on those four issues.  The Commonwealth then, by way of interlocutory application, sought that Justice Rangiah make an order to the effect that the matter proceed solely on those four issues and his Honour declined to do so.  So at no time, your Honour, have I been of the understanding that the matter was restricted on those issues and only those issues.  Thank you, your Honour.

HER HONOUR:   Yes, thank you, Dr Elston.

The matter before the Court today is an application for reinstatement of an application for special leave to appeal from an order for security for costs made on 1 July 2014 by the Federal Court.  The order for security for costs depended substantially on the assessment of the Federal Court judge as to Dr Elston’s prospects of success on an appeal from the decision of the primary judge.  There are questions as to whether the issue of defamation was both alive and dealt with by the primary judge; and then as to whether it was considered by the judge who made the order for security for costs when considering prospects of success.

In these circumstances, I consider it preferable that the matter proceed to a determination of the application for special leave to appeal from the order for security for costs.  I will order that that application be reinstated.  The matter will then be referred to a panel of Justices who may determine the matter on the papers.  With that in mind, I will direct Dr Elston to file further submissions as to the issue of defamation – as to whether it was a live issue and whether it was dealt with by the primary judge following the trial.  Those submissions should be filed by Friday, 30 January 2015.

I will not direct the Commonwealth to file submissions in response at this point because it is a matter for the Justices forming the panel whether or not they will deal with the matter on the basis of only Dr Elston’s submissions on the papers, or whether they will require submissions from the Commonwealth in response.  The only order that is required today is that the application for special leave be reinstated.  I order accordingly.

MR ELSTON:   Your Honour, may I ask then in relation to the cause of action of breach of deed of agreement?

HER HONOUR:   No, I have dealt with the matter.

MR BICKFORD:   Would your Honour reserve the costs?

HER HONOUR:   Yes, since the matter has been left in abeyance, so to speak, pending the determination of the panel of Judges, I think it is appropriate that I reserve the costs to the outcome of the special leave application.

MR BICKFORD:   Thank you, your Honour.

HER HONOUR:   The Court will now adjourn.

AT 10.38 AM THE MATTER WAS ADJOURNED