Francis (a pseudonym) v Commonwealth of Australia (No 5)
[2024] ACTSC 195
•24 June 2024
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: | Francis (a pseudonym) v Commonwealth of Australia (No 5) |
Citation: | [2024] ACTSC 195 |
Hearing Date: | 24 June 2024 |
Decision Date: | 24 June 2024 |
Before: | McCallum CJ |
Decision: | (1) The defendant’s application in proceeding dated 19 June 2024 is refused. (2) I order the Commonwealth to pay the plaintiff's costs of the application. |
Catchwords: | CIVIL LAW – JURISDICTION, PRACTICE AND PROCEDURE – where proceedings resolved on terms requiring the Commonwealth to pay disputed portion of judgment sum into court and balance to plaintiff – where Commonwealth later formed the view that the amount agreed to be paid into court was inadequate to disputed sum consent orders – where defendant seeks a partial stay of consent order – where defendant has discharged its liability under the consent judgment but is inadequate to cover newly calculated liability – where defendant was under an obligation pay interest on the judgment debt – interpretation of consent orders |
Legislation Cited: | Court Procedures Rules 2006 (ACT) r 1616 |
Texts Cited: | Perry Herzfeld and Thomas Prince, Interpretation (Thomson Reuters, 2nd ed, 2020) |
Parties: | Alan Francis (a pseudonym) ( Plaintiff) Commonwealth of Australia ( Defendant) |
Representation: | Counsel D Campbell SC with J Ronald ( Plaintiff) D Davidson ( Defendant) |
| Solicitors Porters Lawyers ( Plaintiff) Australian Government Solicitor ( Defendant) | |
File Number: | SC 24 of 2023 |
McCALLUM CJ:
EX TEMPORE REASONS (REVISED)
1․In these proceedings, Mr Francis (a pseudonym) seeks damages for injuries suffered as a result of his treatment during his period as a young recruit to the Royal Australian Navy in the late 1960s.
2․The proceedings have been resolved by the entry of a general form of consent judgment which is recorded by consent and without admission in the following terms:
1.Judgment for the plaintiff against the defendant for the sum of $1,675,000 inclusive of costs (the judgment sum).
2.The defendant shall be at liberty to deduct and pay from the judgment sum any moneys repayable in respect of social services or health services concerning which any demand or notice has been given under:
(a)section 1182 or 1184 of the Social Security Act 1991 (Cth);
(b)the Health & Other Services (Compensation) Act 1995 (Cth).
3.As to the balance of the judgment sum:
(a)the defendant to pay $500,000 into court pending the court declaring pursuant to proposed separate questions to be settled by the Registrar in accordance with division 2.15.3 of the Court Procedure Rules 2006 (ACT), whether any part of that sum is repayable by the plaintiff to the Department of Veterans' Affairs (such sum being hereafter called the disputed amount);
(b)the disputed amount shall thereupon be retained by the court until it is disposed of by the court in accordance with any further order that might be made by the court;
(c)the defendant otherwise is to pay to the plaintiff, or upon receipt of a duly executed authority of the plaintiff, or his solicitor, the balance of the judgment sum.
3․Order 4 is in terms commonly included in settlements of this kind and, indeed, judgments of the court, providing that no interest shall be payable in respect of the judgment sum if payment is made by the defendant to the plaintiff, less the statutory paybacks referred to in order 2, within 28 days of the receipt by the plaintiff of certain documents, whichever is the later.
4․Order 5 provided that the defendant would pay the disputed amount into court pursuant to r 1616 of the Court Procedures Rules2006 (ACT), to be disposed of by the court in accordance with the court’s further order. That payment was been made within 28 days of the entry of the orders on 21 February 2024.
5․The terms of the separate questions referred to in order 3(a) were resolved by me in a separate earlier judgment in these proceedings: [2024] ACTSC 145. I have today heard argument in respect of the separate question.
6․In the meantime, on 19 June 2024, the Commonwealth filed an application in proceeding seeking the following order:
Order 3(c) of the Consent Judgment between the parties entered into on 21 February 2024, be partially stayed pending the Court's determination of the plaintiff's application in Proceeding lodged on 28 February 2024 [the application for determination of the separate question] to the extent of $80,375.07, being the amount which, in addition to the amount held in Court pursuant to Order 3(a) of the consent judgement, remains in dispute.
7․The central basis for the application as set out in the grounds of application is that the Commonwealth contends that it has already discharged its liability pursuant to the consent judgment and that the previously agreed disputed sum will be inadequate to the extent of the $80,375.07 now sought to be held back. It was submitted that, on the balance of convenience, the Court should accordingly stay the judgment for that additional amount.
8․The application invokes the exercise of the Court's inherent power.
9․A number of premises underlie the Commonwealth’s application: first, that the Commonwealth, having consented to the judgment (which, as I have noted, was entered on 21 February 2024), is not bound by those orders to pay the judgment debt within any particular time; secondly, that at this stage of the proceedings the matter is not at the stage of any enforcement proceedings that might be taken in accordance with the Court Procedures Rules and, thirdly, that in terms of time to pay, the only relevant provision of the orders themselves is the fact that there is an entitlement to interest if the judgment debt is not paid within 28 days.
10․The argument, as I understood it, was that the Commonwealth is under no present obligation to pay the judgment debt but only under an obligation to pay interest in respect of any part of the judgment debt not paid within 28 days. So far as the parties were able to assist me in argument this morning, there is no provision in the Court Procedures Rules that specifies a time to pay. It follows that the proper construction of the determination of the obligation to pay stands on the proper construction of the orders. That issue is addressed in Perry Herzfeld and Thomas Prince, Interpretation (2nd ed, 2020, Law Book Co of Australasia) at [36.110]:
The rules of construction applicable to orders generally apply to consent orders and undertakings. In the case of consent orders, the task is still one of construction of the language in the orders, not a search for the subjective intention of the consenting parties. The orders must be construed as a whole and given effect on their terms. Where the consent orders give effect to the compromise of a dispute, at least in cases of ambiguity it is permissible to take into account the same material which would be admissible in construing the compromise (ie material concerning the surrounding circumstances known to the parties). Thus, the same approach applies to consent orders as to orders generally. While there will usually be no reasons for judgment, extrinsic material such as the nature of any dispute which was compromised, pleadings, evidence, correspondence between the parties leading to the consent orders including any settlement agreement or draft orders submitted by the parties, well-accepted practices in the kind of litigation at issue and the statutory context can assist in the construction.
11․The Commonwealth submitted that the balance of convenience favours the grant of a stay because, in the event that the Commonwealth is successful to the full extent contended in the current dispute, it would then be necessary for it to bring proceedings against Mr Francis to recover the overpayment.
12․As noted by Mr Campbell SC, however, there is no evidence before me of impecuniosity or any risk of dissipation of the amount paid. Furthermore, there is no evidence by which I can measure the reasonableness or likely accuracy of the calculation of the $580,375.07 now determined by the Commonwealth to be the correct sum nor, indeed, of the reasonableness of the previous amount agreed in the consent orders of $500,000.
13․Most importantly, there has been no appeal from the consent judgment and there has been no application brought to set those orders aside. In effect, the Commonwealth has made a unilateral decision to hold back more than the amount that was agreed and reflected in the consent orders to be the disputed amount. The critical question is whether, in accordance with the consent orders, the Commonwealth ought to have paid all but the $500,000, being the disputed amount, before now.
14․In my assessment, on a proper construction of the orders read as a whole, the clear intention was that the Commonwealth would, within 28 days, pay the $500,000 into court and the balance, less the statutory holdbacks, to the plaintiff or as directed by him. The Court cannot, at this point, enforce the Commonwealth's compliance with that agreement outside the usual processes provided for in the rules of court. However, in my assessment, it would plainly be an inappropriate use of the Court's inherent power to grant a stay to make the order sought in the present application.
15․It is, in substance, an application which asks the Court to go behind the consent judgment in which the Commonwealth, presumably properly advised, reached a determination as to the appropriate amount to be held back. That may or may not have reflected the correct amount the plaintiff may be liable to repay the Commonwealth. It may simply have reflected the level of risk with which the Commonwealth was comfortable at that time. The assertion of a subsequent mistake is irrelevant in the Court's construction of those orders.
Orders
16․For those reasons, the following orders are made:
(1)The defendant’s application in proceeding dated 19 June 2024 is refused.
(2)I order the Commonwealth to pay the plaintiff's costs of the application.
(3)As to the substantive determination of the separate question, I reserve my decision.
| I certify that the preceding sixteen [16] numbered paragraphs are a true copy of the Reasons for Judgment of her Honour Chief Justice McCallum Associate: Date: |
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