FEDERAL COURT OF AUSTRALIA
Kirby v Centro Properties Limited (No 2) [2011] FCA 1144
Citation: Kirby v Centro Properties Limited (No 2) [2011] FCA 1144 Parties: RICHARD KIRBY v CENTRO PROPERTIES LIMITED, CPT MANAGER LIMITED, PRICEWATERHOUSECOOPERS (A FIRM), BRIAN HEALEY, SAMUEL KAVOURAKIS, JAMES WILLIAM HALL, PAUL ASHLEY COOPER, ROMANO GEORGE NENNA AND ANDREW THOMAS SCOTT
RICHARD KIRBY v CENTRO RETAIL LIMITED, CENTRO MCS MANAGER LIMITED, PRICEWATERHOUSECOOPERS (A FIRM), BRIAN HEALEY, SAMUEL KAVOURAKIS, JAMES WILLIAM HALL, PAUL ASHLEY COOPER, ROMANO GEORGE NENNA AND ANDREW THOMAS SCOTT
NICHOLAS VLACHOS, MONATEX PTY LTD AND RAMON FRANCO v CENTRO PROPERTIES LIMITED, CPT MANAGER LIMITED, CENTRO RETAIL LIMITED, CENTRO MCS MANAGER LIMITED, PRICEWATERHOUSECOOPERS (A FIRM), BRIAN HEALEY, SAMUEL KAVOURAKIS, JAMES WILLIAM HALL, PAUL ASHLEY COOPER, ANDREW THOMAS SCOTT AND ROMANO GEORGE NENNA
NICHOLAS STOTT v PRICEWATERHOUSECOOPERS SECURITIES LIMITED, CENTRO RETAIL LIMITED, CENTRO MCS MANAGER LIMITED, CENTRO CORPORATE SERVICES PTY LTD, PRICEWATERHOUSECOOPERS (A FIRM), BRIAN HEALEY, SAMUEL KAVOURAKIS, JAMES WILLIAM HALL, PAUL ASHLEY COOPER, ANDREW THOMAS SCOTT, ROMANO GEORGE NENNA, CENTRO PROPERTIES LIMITED AND CPT MANAGER LIMITED
NICHOLAS VLACHOS, MONATEX PTY LTD AND RAMON FRANCO v PRICEWATERHOUSECOOPERS (A FIRM), CENTRO PROPERTIES LIMITED, CPT MANAGER LIMITED, CENTRO RETAIL LIMITED, CENTRO MCS MANAGER LIMITED, BRIAN HEALEY, SAMUEL KAVOURAKIS, JAMES WILLIM HALL, PAUL ASHLEY COOPER, ANDREW THOMAS SCOTT AND ROMANO GEORGE NENNA
File number(s): VID 326 of 2008
VID 327 of 2008
VID 366 of 2008
VID 1028 of 2010
VID 1041 of 2010Judge: MIDDLETON J Date of judgment: 2 November 2011 Catchwords: COURTS AND JUDGES – Practice and procedure – Reasonable apprehension of bias – Pre-judgment – Judge found in earlier proceeding a number of facts relevant to present proceedings – Parties objecting were not parties to earlier proceeding – Whether findings were of a significance and nature to cause reasonable apprehension of bias – Whether judge should hear the present proceedings. Legislation: Corporations Act 2001 (Cth)
Evidence Act 1995 (Cth)Cases cited: A1 v King QC (unreported, Merkel J, 31 May 1996)
Australian Securities and Investments Commission v Healey (2011) 278 ALR 618; [2011] FCA 717
Australian Securities and Investments Commission v Healey (No 2) [2011] FCA 1003
Bainton v Rajski (1992) 29 NSWLR 539
Barton v Walker [1979] 2 NSWLR 740
British American Tobacco Australia Ltd v Gordon (2007) NSWSC 109
British American Tobacco Australia Services Ltd v Laurie (2011) 242 CLR 283
Brooks v The Upjohn Company (1998) 85 FCR 469
Cabcharge Australia Ltd v Australian Competition and Consumer Commission [2010] FCAFC 111
Ebner v The Official Trustee in Bankruptcy (2000) 205 CLR 337
Gascor v Ellicott [1997] 1 VR 332
Johnson v Johnson (2000) 201 CLR 488
Lee v Cha [2008] NSWCA 13
R v Burrell (2007) 175 A Crim R 21; [2007] NSWCCA 79 R v Watson; Ex parte Armstrong (1976) 136 CLR 248
Rajski v Wood (1989) 18 NSWLR 512
Re JRL; Ex parte CJL (1986) 161 CLR 342Sengupta v Holmes [2002] EWCA Civ 1104
Vakauta v Kelly (1988) 13 NSWLR 502
Vakauta v Kelly (1989) 167 CLR 568
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- Case
- [2011] FCA 1144
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CaseChat Overview and Summary
The legal issue before the court was whether the judge's prior findings in the earlier proceeding, which were not contested by the parties in that proceeding, could create a reasonable apprehension of bias when the judge was asked to hear the present case. The central question was whether these findings were of such a significance and nature that they might lead a reasonable observer to doubt the judge's impartiality.
The court found that the fact the judge had expressly stated the findings were for the purposes of the earlier proceeding did not mitigate the potential for apprehended bias. The court noted that the lay observer would understand that a judge is expected to be able to set aside earlier views when necessary. Additionally, the court considered that the findings were made with a degree of satisfaction, indicating the judge's actual persuasion of their correctness, and involved serious misconduct. However, the court held that each case of apprehended bias must be assessed on its own circumstances, taking into account the lay observer's perspective on human nature. Given the unusual circumstances of the case, where the parties were not involved in the earlier proceeding and no witness credibility issues arose, the court concluded that there was no case of apprehended bias.
The court's decision was that the judge should not recuse themselves from hearing the present proceedings. The findings from the earlier proceeding, while relevant, did not give rise to a reasonable apprehension of bias.
Orders
Orders of the court
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Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
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Ratio Decidendi
Legal Principle Established
PwC and PwCS’ ninth – and final – contention is about an observation I made about some email correspondence between a PwC employee, Angela Evans, and an employee of Centro’s finance department, Mr Gore. I found that the evidence indicated that they were using an old Australian Accounting Standards Board standard in relation to the classification of current and non-current liabilities. This is disputed in these proceedings by PwC and PwCS. At [370], I said:Angela Evans, an employee of PwC, was working on the audit of Centro. Ms Evans corresponded by email with Richard Gore of Centro. In the process of finalising the full financial statements of CNP, Mr Gore sent an email to Ms Evans on 18 August 2007. Mr Gore provided responses to an “open items list”, prepared by PwC, which considered whether material could be produced to show that the JP Morgan facilities could be extended beyond 6 September 2007. The question of whether a facility can be extended after the balance date, but before the reporting date, is a highly relevant inquiry under the old standard, but is quite irrelevant under the new standard. The evidence seems to indicate that both Mr Gore and Ms Evans were operating under the old standard. CONSIDERATION The first point to make is that, as a matter of principle and in the circumstances of these proceedings, the fact that I had expressly stated in the ASIC proceeding that the findings were made only for the purposes of the ASIC proceeding (or like expressions), is of no real significance. The findings of fact were made in the exercise of judicial power and only made for the purpose of the ASIC proceeding. Whether such expressions are used or not by the judge in an earlier proceeding, the lay observer will appreciate that a judge is capable of putting out of his mind those earlier views expressed for the purpose of fulfilling his or her judicial function in a particular proceeding, as is the responsibility of the judge. The second matter to observe is that the lay observer will take into account that in the ASIC proceeding I had reached a degree of satisfaction or “actual persuasion” of the correctness of my conclusions. I do not consider that it matters whether the findings were made to any particular standard of proof; although the lay observer will take into consideration that, based upon the primary facts, I felt justified in making declarations of contravention of civil penalty provisions, which involved serious misconduct. The third matter to mention again is that every application for a judge to disqualify himself or herself must be considered in the circumstances, particularly taking into account the lay observer’s point of view as to “human nature”. I consider the circumstances before me are unusual. I appreciate that PwC and PwCS were not parties to the ASIC proceeding, and no issue of credit of any witness arose in that proceeding. I accept that just because findings are made on the same issue that is subsequently to be considered does not necessarily lead to the conclusion that there is a case of apprehended bias.