Kelly v Commonwealth of Australia as represented by Services Australia (formerly the Department of Human Services) (No 2)

In the case of Kelly v Commonwealth of Australia as represented by Services Australia (No 2), the primary issue before the court was the respondents' application for the dismissal of the proceeding pursuant to sections 37P(5) and/or (6)(a) of the Federal Court Act 1976 and rules 5.23(1)(b) and 2(a) of the Federal Court Rules 2011. The respondents argued that the applicant's extraordinary delays in preparing the matter for hearing, coupled with his default in complying with court orders, warranted dismissal. The applicant had cited illness as a contributing factor to the delays. Additionally, the respondents sought a guillotine order under section 37P(3)(a) of the Federal Court Act and a costs order under section 37P(6)(d) of the Federal Court Act and section 570(2)(b) of the Fair Work Act 2009.

The court considered the applicant's claim of illness and the evidence presented, noting that the viral infection did not provide a sufficient explanation for the delays, as it arose only after the evidence was already overdue and had resolved by mid-February 2025. The applicant's mental health issues, which had been known since at least 2020, were also considered, but the court found that they did not sufficiently explain the present default. The court concluded that the applicant's solicitors should have anticipated difficulties in preparing the case and should have sought a re-listing of the matter as soon as the problems became apparent. Given the uncertainties and complexities, the court decided not to dismiss the proceeding but to impose a strict timetable with a dismissal order in the event of non-compliance.

The court issued a detailed order requiring the parties to submit agreed or competing draft timetabling orders by 4 pm on Friday, 18 July 2025. These orders were to include a provision that the proceeding would stand dismissed if the applicant failed to file any part of his evidence or written submissions by the specified date. The respondents' interlocutory application filed on 24 February 2025 was dismissed, and the applicant was ordered to pay the respondents' costs of that application, including the costs of the applicant's application to re-open his case, as agreed or assessed.