LOOMIS & PATTISON
[2020] FCCA 345
•22 January 2020
FEDERAL CIRCUIT COURT OF AUSTRALIA
| LOOMIS & PATTISON | [2020] FCCA 345 |
| Catchwords: FAMILY LAW – Costs – party/party costs – financial circumstances of the parties – conduct of the parties – where the respondent has been wholly unsuccessful. |
| Legislation: Family Law Regulations1984 (Cth) rr.67Q, 67B, 67C, 67F, 67G, 67L, 67K, 67I Family Law Rules 2004 (Cth) rr.26B.33, 26B.01, 26.02, 26B.04 Family Law Act 1975 (Cth) ss.13E, 13H, 10M, 10L, 13F, 117 Commercial Arbitration Act2010 (NSW), s.36 Federal Circuit Court Rules 2001 (Cth), pts.14, 24, 27, ,sch 1 |
| Cases cited: Cooney & Fitzsimons [2019] FCCA 373 Braddon & Braddon [2018] FCCA 1845 Pavic & Pavic [2018] FCCA 3386 Blanco & Blanco (No.2) [2019] FCCA 2458 Allesch v Maunz [2000] HCA 40 Harper & Harper [2016] FCCA 1603 |
| Applicant: | MS LOOMIS |
| Respondent: | MR PATTISON |
| File Number: | PAC 1065 of 2007 |
| Judgment of: | Judge Harman |
| Hearing date: | 22 January 2020 |
| Date of Last Submission: | 22 January 2020 |
| Delivered at: | Parramatta |
| Delivered on: | 22 January 2020 |
REPRESENTATION
| Counsel for the Applicant: | Mr Schroder |
| Solicitors for the Applicant: | Rafton Family Lawyers |
| The Respondent appeared in person |
ORDERS
Dismiss the Objection of Mr Pattison to registration of the Arbitral Award dated 15 November 2019.
The Arbitration Award of Mr Maurice Edwards dated 15 November 2019, is registered as it if were a Decree of the Federal Circuit Court of Australia.
Dismiss all extant Applications and Responses.
Remove all issues from the list of cases awaiting hearing
Upon the expiration of the Appeal period and in the event that no appeal is lodged that all exhibits then be returned to the party who tendered same and that all material produced on subpoena or pursuant to section 69ZW of the Family Law Act 1975 be returned to the person or organisation who produced same or securely destroyed.
THE COURT FURTHER ORDERS THAT:
Mr Pattison shall pay to Ms Loomis, as contribution towards her costs with respect to the determination and dismissal of his Application for Objection to Registration of an Arbitral Award, the sum of $5,909, such costs to be a charge upon his interests in funds to be paid to him by Ms Loomis pursuant to the Arbitral Award now registered with the court and, to that extent, Ms Loomis is authorised to deduct from any payment to be made or offered by her to Mr Pattison the sum of $5,909 and so as to reduce the total amount payable by her to Mr Pattison by that sum.
IT IS NOTED that publication of this judgment under the pseudonym Loomis & Pattison is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT PARRAMATTA |
PAC 1065 of 2007
| MS LOOMIS |
Applicant
And
| MR PATTISON |
Respondent
REASONS FOR JUDGMENT
The applications before the Court comprise an Application for registration of an Arbitral Award and an objection to registration of an Arbitral Award.
As would be apparent from the nature of those Applications, the substantive proceedings relate to Part VIII property adjustment relief.[1]
[1] Sections 10L and 13E Family Law Act 1975 (Cth) only permit of consensual referral to arbitration of property adjustment proceedings.
The parties to the proceedings are Ms Loomis, the applicant in both the substantive proceedings and in the Application for registration of an Arbitral Award, and Mr Pattison, the respondent in both the substantive proceedings and those relating to registration of the Arbitral Award. Mr Pattison is the objector, so to speak, in relation to registration of the Arbitral Award.
The objection is raised by Mr Pattison in an Affidavit, sworn or affirmed 17 December 2019 and filed the same day.[2]
[2] Regulation 67Q(3) Family Law Regulations 1984 (Cth) provides that a party may, within 28 days after service of an application for Registration of an Arbitral Award, bring to the attention of the court any reason why the award should not be registered. The regulations provide no specific mechanism for raising objection although the regulations concludes with a note “An example of a way of bringing a matter to the attention of the court is by filing an affidavit”.
Material considered in dealing with the proceedings
I have read and considered the following material. In the case of Mr Pattison, I have read his Affidavit as identified above. In the case of Ms Loomis, I have read her Application for Registration of Arbitral Award, filed on 20 November 2019 and Application in a Case, filed on 20 January 2020. It should be observed the Application in a Case seeks to do no more than effect registration of the arbitral award. An order is also sought that the objection be dismissed. I have also read a brief Affidavit of Ms Loomis, although it does not take the matter any further, (that Affidavit was also filed 20 January 2019) and, finally, an Affidavit of Service filed 2 December 2019.
The Affidavit of Service deposes to service upon Mr Pattison of the Application to Register the Arbitral Award. That document is of some importance as the Family Law Regulations1984 (Cth) and the Family Law Rules 2004 (Cth) require that an Application for Registration of an Arbitral Award be served as soon as possible and within fourteen days of filing.[3]
[3] Regulation 67Q(2) and Rule 26B.33. The Affidavit of service must then be filed within 7 days of service.
It is on that basis that the time period, at the expiration of which registration is to be effected, absent objection,[4] is calculated by reference to regulation 67Q. There can be no doubt that a period in excess of 28 days has passed since notice of application to register the Arbitral Award was given. But for the objection communicated via Mr Pattison's Affidavit referred to above, the Award would have been registered. Absent objection to registration there is no discretion as to refuse registration. The Arbitral Award must be registered. To that end, regulation 67Q subsection (4) is clear:
If nothing is brought to the court's attention under subregulation (3), the court must register the award.
[4] Regulation 67Q(4) provides that registration of the award is mandatory absent objection. If objection is raised then Regulation 67Q(5) provides that “If a party brings a matter to the court's attention under subregulation (3), the court must, after giving all parties a reasonable opportunity to be heard in relation to the matter, determine whether to register the award”
I am satisfied that following the determination of the objection, and if the objection is dismissed, that whilst regulation 67Q(5) expresses a discretion to register the Arbitral Award, that the Arbitral Award should be immediately registered.[5] For the reasons that will follow, that is the path that will be taken.
[5] Cooney & Fitzsimons [2019] FCCA 373
Registration of Arbitral Awards
Arbitral Awards need not be registered. However, to be enforceable as if an order or decree of the Court, the Arbitral Award must be registered. On that basis, section 13H of the Family Law Act 1975 (Cth) permits application for registration, but does not compel it. Even if neither party seeks registration of the Arbitral Award, the Arbitrator has an obligation, if the arbitration was ordered by the Court pursuant section 13E Family Law Act 1975, to inform to the Registry upon completion of the arbitration.[6] However, it is not a matter for the Court, of its own volition, to register an Arbitral Award. A party must seek it. In this case, clearly, the wife has made application for registration. As already observed, regulation 67Q provides the time periods that apply as to a period for objection and, accordingly, as that period has passed, I am satisfied that the court can now properly proceed.
[6] Regulation 67P and Rule 26B.32.
The Husband's Objection
Before turning to the specific bases of objection raised by Mr Pattison, I propose to discuss broadly the legal principles that I am satisfied would apply. There is, at this point in time, little jurisprudence in relation to arbitration in the family law field. There is much more speculation and academic discourse.
There are two judgments previously delivered by me that would be relevant. Each are referred to by Mr Pattison, together with an article published in the New South Wales Law Society Journal[7] regarding family arbitration and various aspects thereof, including objection to registration of or review of awards.
[7] and, in fact, the Law Society or Institute Journal of each state and territory
The first decision of Braddon & Braddon [2018] FCCA 1845[8] had sought to set out, entirely obiter, the bases upon which objection might occur, taking those bases at their broadest. That included bases which might be drawn in by reference to the powers given to the Court under the Family Law Act (supra) for the review or setting aside of an Arbitral Award. Ultimately, and as discussed in the subsequent decision of Pavic & Pavic [2018] FCCA 3386,[9] whilst Braddon had hypothesised the bases for objection at their broadest, those considered were, in fact, too broad. In the latter decision of Pavic, I had more specifically confined my view, and I accept that it is the view of a first-instance trial judge, not an appellate Court, as to the breadth of the bases upon which objection might be taken. To that end, I incorporate paragraphs 17 to 47 of that decision in Pavic. It commences at paragraph 17 with the specific caveat that the obiter comments in Braddon are, with hindsight, far too broad.
[8](‘Braddon’)
[9] (‘Pavic’)
17. In my earlier decision of Braddon reference was made by me to the bases upon which objection to registration might arise. At paragraph 49 of Braddon, I had said:
In the absence of any clear specification or definition, within either the Family Law Act or the Regulations, of reasons which support non-registration of an Arbitral Award, I am satisfied, that those reasons should be approached from the perspective of and upon the same basis as, the grounds for reviewing or seeking to set aside a registered Award pursuant to sections 13J and 13K of the Family Law Act together with any complaint as to non-compliance with the regulations.
18. Sections 13J and 13K of the Family Law Act 1975 relate, respectively, to review of an award or setting aside an award. Whilst in Braddon I made reference to the grounds of registration being no broader than the bases set out in these sections, it must be remembered that Braddon did not proceed as an objection to registration. As would be apparent from paragraph 69 of that Judgment, the award had been registered prior to any Application to impeach the award and, accordingly, an objection to the award’s registration could not have been maintained. The term “objection” was used as a broad term seeking to capture both the section 13J and 13K grounds for review and setting aside. Hereafter, I will confine any discussion specifically to the grounds that arise from both the Act and Regulations. I am conscious to ensure that definitional integrity is adopted.
19. As the grounds for objection to registration of an arbitral award are not defined, it is necessary to give some consideration to what might be appropriate or permissible bases for objection. That consideration is separate to any consideration of the grounds for review or to set aside the award once registered. The grounds for review and setting aside of an award are specifically defined by the Family Law Act 1975 and the sections already referred to.
20. In relation to matters that might be a basis for objection to registration of an arbitral award, I am satisfied that assistance and guidance is given by a consideration of the provisions of the Commercial Arbitration Act 2010 (NSW), which I shall hereinafter refer to as “the Model Law”, as the Act is largely replicated in the various State arbitration Acts which are each the subject of settled jurisprudence.
21. I am satisfied that reference within the Model Law to “recognition and enforcement” of awards is directly referable to registration of an award under the Family Law Act 1975. They are one and the same. In that regard, I am also conscious of that opined by Professor Parkinson in a paper delivered to the Family Law Pathways group, Katoomba, June 2016.[1] Therein Professor Parkinson observes at page 9:
“...it is important to note that an arbitral award only takes effect once registered”
And hence the arbitral award is enforceable only upon registration.
22. In the absence of authority as to the proper basis for objection to registration of an arbitral award, I am satisfied that I should consider the address of that issue by reference to the Model Law. That will provide the guidance of Superior Courts and lead to consistency between jurisdictions.
23. Section 36 of the Model Law provides for “recognition and enforcement” or arbitral awards rather than registration. The Model Law provides for enforcement of an arbitral award by recognition (and enforcement). I am satisfied that “recognition and enforcement” of an arbitral award, as described in the Model Law, is referrable to and one and the same as registration of an arbitral award under the Family Law Act 1975.
24. In relation to objection, Professor Parkinson opines, commencing at page 12 of the above article, as follows:
Because the legislation only provides for an arbitration award to be challenged after it has been registered in Court and the regulations do not indicate the basis for objection, it is necessary to go back to some basic principles to understand what this right to “bring to the attention of the Court any reason why the award should not be registered” might mean. The first point to observe is that the regulations are subject to the head legislation. If any regulation is inconsistent with the terms of the legislation, it will be invalid to the extent of that inconsistency. Section 13H Family Law Act does not give any party to an arbitration a right to object to registration. It only gives the Court the power to review the arbitration award (on the various grounds given) after it has been registered, so whatever the right to “bring to the attention of the Court any reason why the award should not be registered” its meaning ought to be consistent with the legislation’s provision that powers of review be exercised in relation to registered awards.
25. I am satisfied that what Professor Parkinson is indicating at this point is entirely consistent with settled case law relating to the interpretation of section 36 of the Model Law. Professor Parkinson continues:
Secondly, as a matter of general principle, Australian Courts will only deal with orders of another Court if the orders are registered. It is the registration that gives the Court jurisdiction to deal with it by enforcement or otherwise. Thirdly, before any legal document can create rights and obligations, the conditions precedent for legal validity must be satisfied. Unless and until the conditions precedent for a valid contract are satisfied, there is no contract to interpret or enforce. Unless a Court, other than a superior Court of record, has jurisdiction to make an order, any orders it purports to make are a nullity (see Enid Campbell ‘Inferior and Superior Courts of Record” (1997) 6 Journal of Judicial Administration 249).
26. I pause to observe that Professor Parkinson’s opinions on this point accord with my own. The direct comparison between the Model Law, to the extent that it discusses recognition and enforcement, must compel that registration under the Family Law Act 1975 and Family Law Regulations 1984 be read, considered, and interpreted on the same footing. Professor Parkinson concludes:
It follows that the most sensible interpretation of the right to “bring to the attention of the Court any reason why the award should not be registered” is that a person may argue that an award should not be registered because one of the conditions precedent for legal validity have not been met. Examples might be:
(a) The objecting party did not consent to the arbitration. [In the context of the Family Law Act 1975, it must be observed that section 13E, referrals to arbitration, can only occur by consent];
(b) The arbitrator is not qualified in accordance with the regulations. [In this regard, it is to be noted that the arbitrator - whose qualifications and whose arbitral award I will return to shortly – is included in the list of accredited arbitrators maintained by the Australian Institute of Family Law Arbitrators and Mediators (AIFLAM)[2] as an arbitrator and, accordingly, that could not be a challenge];
(c) The arbitration purports to deal with matters that are outside of the scope of the matters that may legally be arbitrated.
27. Again, the Order referring the matter to arbitration, as recited above, referred the totality of the proceedings to arbitration. Accordingly, and there being no challenge to the exercise of power by the arbitrator as going beyond that which was referred, such objection could not be maintained.
28. Professor Parkinson concludes:
If such matters were made out then there would be no legally valid arbitration award to register, review or set aside. If the arbitration award is valid on its face – that is, the conditions precedent for it to be described as an arbitration award under the Family Law Act are met – then it should be registered and objections to its enforcement dealt with in accordance with sections 13 J and K, the power to review awards or set them aside.
29. If one turns to section 36 of the Model Law relating to recognition and enforcement of arbitral awards, the grounds that are provided accord with that expressed by Professor Parkinson and, indeed, more broadly describing the conditions precedent of a valid arbitration.
30. Section 36 of the Model Law provides that a Court may refuse to recognise or enforce an arbitral award on a number of grounds including:
(a) Incapacity of a party;
(b) That the arbitration agreement is not valid under the law to which the parties are subjected – in this case, the Family Law Act 1975;
(c) That a party against whom the award is invoked was not given proper notice of the appointment of the arbitrator;
(d) The award deals with a dispute not contemplated or falling within the terms of submission to arbitration;
(e) The composition of the arbitral tribunal was not in accordance with the agreement of the parties;
(f) The award has not yet become binding on the parties under the law under which the arbitration was conducted.
31. The grounds to oppose recognition and enforcement of an arbitral award under the Model Law, whilst not specifically enumerated in regulation 67Q of the Family Law Regulations 1984, are a good starting point for understanding what might be appropriate bases to object to registration of an arbitral award. They largely reflect the points above. I propose to deal with each of them briefly:
(a) Neither party suggests that they were under an incapacity;
(b) Neither party suggests that the proceedings were determined other than in accordance with the law of the jurisdiction in which the arbitration occurred. That is not to suggest that there is no complaint that the law was misapplied. However, the correct law was identified and applied;
(c) Proper notice was given of the arbitration. Both parties participated in the arbitration and were represented by Counsel. That must, of itself, obviate against any complaint as to a lack of notice;
(d) The award deals with issues and disputes which are contemplated by the parties. The totality of the dispute was referred to arbitration and an arbitration agreement entered into which clearly defined the issues for determination and it is those issues which were determined;
(e) The arbitrator, Mr David, is an accredited arbitrator for the purpose of the Family Law Regulations 1984;
(f) The parties had entered into a mediation agreement, as is recited within the arbitral award.
32. Whilst the grounds for objection to registration of an arbitral award under the Family Law Act 1975 are not necessarily strictly confined to those enumerated by section 36 of the Model Law, the grounds for objection to registration, (in the case of the Family Law Act 1975), and for recognition and enforcement (in the case of the Model Law) should be interpreted consistently across jurisdictions.
33. None of the above grounds that could be a basis for objection to registration arise.
34. Objection to registration deals with the constitution of the arbitral tribunal and the necessary preconditions thereto, matters such as the giving of notice, submission to arbitration and the like. All of those conditions are satisfied in this case. Objection could not thus be established.
35. Section 34 of the Model Law, which deals with setting aside arbitral awards, might also be relevant, by way of comparison, in informing the possible bases for objecting to registration of an arbitral award. However, the section need not be considered further as the grounds for setting aside an arbitral award under section 34 are identical to those for opposing recognition and enforcement under section 36.
36. The standard of proof required to demonstrate and establish the bases for objection to registration of an arbitral award also requires some comment. I am satisfied that the appropriate standard is that described in TCL Air Conditioner (Zhongshan) Co Ltd v The Judges of The Federal Court of Australia & Anor [2013] HCA 5. In that case, the High Court of Australia made clear that an arbitral award would not be set aside or recognition refused under sections 34 and 36 respectively of the Model Law:
unless there is demonstrated real unfairness or real practical injustice in how the [international case] litigation or dispute resolution was conducted or resolved by reference to established principles of natural justice or procedural fairness. The demonstration of real unfairness or real practical injustice will generally be able to be expressed and demonstrated with tolerable clarity and expedition.
37. The above passage might suggest a further ground of objection, namely, a denial of due process within the arbitration. No such complaint is raised in this case. Further, the arbitral award clearly discloses that both parties were represented and heard, that both parties had input into the definition of the issues to be arbitrated (as set out in the arbitration agreement). Both parties would appear to have been afforded abundant due process.
38. I have also had regard to the discussion of Mason CJ in Autodesk Inc & Dyason (No 2).[3] Whilst, in that case, the Chief Justice was dealing with an Application to set aside a default Judgment, I am satisfied that the principles applicable are comparable to an Application to refuse to recognise and enforce an arbitral award (or, in the Family Law Act 1975 context, register the award) and should be applied.
39. The Chief Justice articulated four principles to be borne in mind in relation to an Application to set aside default Judgment, which principles would be equally applicable to an Application to refuse enforcement or recognition of an arbitral award under the Model Law (or registration of an arbitral award under the Family Law Act 1975), namely:
(1) The power is to be exercised “with great caution” in view of the public interest in the finality of legal proceedings;
(2) The power may be exercised where, through no fault on the Applicant’s part, the Applicant has not been heard on a matter decided by the Court;
(3) The jurisdiction extends to cases where a Court has good reason to consider that the arbitral tribunal has proceeded on a misapprehension of the facts or the law, such as a failure to recognise a line of authority. One of the complaints raised by the wife in these proceedings is that the arbitrator has not applied, for example, the principles enunciated by Baker J in Kowaliw & Kowaliw [1981] FamCA 70; (1981) FLC 91-092. I am not satisfied that that is so, but will, in any event, deal with that issue by reference to review of the arbitral award itself under section 13J of the Family Law Act 1975;
(4) The jurisdiction (in this case, objection to registration of the arbitral award) is not a backdoor for rearguing the case. The objection process is not to be used for the purpose of reagitating arguments already considered by the arbitral tribunal when a party has failed to present that argument in all of its aspects or it was not put at all.
40. Jurisprudence from State superior Courts, operating under the Model Law, make clear that the Court should proceed on the basis of prima facie recognition and enforcement of awards. In Larkden Pty Limited v Lloyd Energy Systems Pty Ltd [2011] NSWSC 1331, Hammerschlag J, at paragraph 25, made clear that complaints with respect to arbitral awards should pertain to “the State’s basic notions of morality and justice with which public policy is more appropriately concerned”, quoting a number of authorities contained within that passage.[4]
41. Similarly, Croft J of the Victorian Supreme Court in Andent Pty Ltd v Thornhill Machine Tools Australia Pty Ltd [2014] VSC 647 said:
The prima facie right to recognition and enforcement of an arbitral award is consonant with the common law view that the issuing of an arbitral award gives rise to an implied promise that the award will be honoured. In Agromet Motoimport Ltd v Maulden Engineering Co (Beds) Ltd[5] Evans LJ said:
“...Conceptually the claim arises under a contractual undertaking to honour the award. This may mean that the party against whom the award is made becomes under an immediate obligation to pay the amount of the award...”
42. I pause to observe that under the Family Law Act 1975, such obligations do not and cannot arise as a legally enforceable obligation until the arbitral award is registered.
43. Croft J concluded:[6]
“It follows that the arbitral award should be recognised and enforced [or, under the Family Law Act 1975, registered] unless any of the grounds enumerated in section 36 apply, or unless a successful application is made to set aside the arbitral award under section 34”
44. Similarly, in Amasya Enterprises Pty Ltd v Asta Developments (Aust) Pty Ltd [2016] VSC 326, Croft J returned to that very issue, quoting at length from the High Court of Australia’s decision in TCL Air Conditioner already referred to. His Honour then, commencing at paragraph 23, embarked upon an erudite discourse with respect to overseas jurisdictions and the principles that have been consistently espoused by those jurisdictions consistent with Australian authority. Each of those cases makes clear that the Court can, and should, recognise and enforce arbitral awards unless it is clearly established that one of the grounds within the enabling legislation make it egregious to do so.
45. By reference to the above, I am not satisfied that an objection could have been made out, although, as is clear from the outset, the objection is not ultimately pressed. However, the initial Application which led to these proceedings being listed for determination was an objection to registration of the arbitral award and it is on that basis that the possible grounds of objection have been addressed.
46. Before concluding a discussion of the possible bases for objection to registration of an arbitral award, it should also be noted that regulation 67P of the Family Law Regulations 1984 might provide additional bases for objection. Regulation 67P provides the technical requirements, if they might be so described, for making an award. It indicates that an award must include a concise statement setting out the reasons for the award and the findings of fact made and referring to evidence considered in making those findings.
47. A complete absence of reasons might be a valid basis for objection to registration of an award, as if so absent, the regulated requirements of an award are not met, (although it is difficult to envisage when this might arise). If a complaint were raised that reasons were inadequate then I am not satisfied that this would be a basis for objection to registration. It would be more appropriate, in the event that there was a challenge as to the adequacy of reasons, that this be dealt with by way of review of the arbitral award. This is so, particularly as a yawning chasm arises between a right to object to registration and what might arise if the objection is upheld. The Act and Regulations are entirely unclear in those circumstances. One might argue that the matter would be remitted to the arbitrator for rehearing in accordance with law. However, once an award is delivered, the referral to arbitration is spent and, accordingly, it is more likely that the Court would then determine the matter as to do otherwise would leave the rights of the parties unaddressed and the controversy between them unquelled. Clearly, if an arbitral award were successfully reviewed, the Court would then proceed to make a determination even if of limited scope such that this latter approach would lend consistency. However, that controversy does not arise in this case and need not be further addressed.
The bases upon which an objection might be raised were considered by reference to certain academic discourse, particularly a paper cited and referred to therein by Patrick Parkinson, together with an analogous consideration of section 36 of the uniform Commercial Arbitration Act2010 (NSW).[10]
[10] (‘Commercial Arbitration Model Laws’)
I am conscious of an unreported decision relating to an Order for arbitration delivered by Judge Egan in the Brisbane Registry. Whilst the decision is unpublished, (and thus I do not specifically refer to its contents), I have had the benefit of viewing the submissions made by counsel for the parties in that decision, and which specifically referred to my earlier decision in Pavic. One submission sought to object to registration by suggesting that had Parliament intended that the grounds for objection would be the same as or analogous to those under the commercial arbitration schemes, that Parliament would have made that clear.
If one extrapolates that argument, then it must fail, with the greatest of respect to its drafter. Parliament has simply chosen to be silent as to the bases of objection and, thus, the court is left to do the best that it can to fill that gap through jurisprudence and interpretation.
Regulation 67Q allows objection, but is entirely silent as to how the objection might be raised with the court or the bases upon which objection might be advanced. To that end, academic speculation has, perhaps, defined parameters for that determination.
Colin Kaeser, in his article The Emergence of Arbitration in Family Law in Australia, had opined:
There is no indication what the basis for such an objection may be as the provisions for the review and setting aside of an award only apply to a registered award. Objection may be limited to whether the award is in the prescribed form.[11]
[11] Colin Kaeser, ‘The Emergence of Arbitration in Family Law in Australia’ (2003) 6(7) Australian Alternative Dispute Resolution Bulletin 125
That is taken up by Geoff Wilson in a lengthy paper prepared by him in relation to the same topic.[12] He goes on to opine that:
It may be that objection can only be made on grounds related to the administrative process of registering the award (eg, irregularity) as otherwise it runs counter-intuitive to the other remedies of review and affirming, reversing, or varying the award once registered.
[12] Geoff Wilson, ‘Arbitration – The New Frontier’ (2016, Online) HopgoodGanim Lawyers
I am not satisfied that the grounds for objection could be that limited as to relate only to an Arbitral Award not being in a prescribed form (assuming such a form were prescribed).
I am conscious that the grounds for objection to registration of an award must be directed towards the composition of the arbitral tribunal, and whether the arbitral process is, in some way, infected with error - particularly error relating to fairness or, as might be described, procedural fairness or due process. There is some support for that proposition from the very terms of the regulations and rules themselves, as well as the discussion, as already referred to, of Parkinson and comments made by the Australian Law Reform Commission in their recent report at paragraphs 9.28 and 9.29. [13]
[13] Australian Law Reform Commission, Family Law for the Future – An Inquiry into the Family Law System (Report No 135, March 2019)
The Law Reform Commission recommends the removal of the ability to object to registration of an Arbitral Award. With the greatest of respect to those who authored the report, I do not concur with that recommendation. The opportunity to object to registration is fundamental.
Review of an Arbitral Award or any application to set it aside is triggered only by registration.[14] The ability to object to registration is, again, analogous to the ability (under section 36 of the Commercial Arbitration Model laws) to oppose enforcement of an Arbitral Award. That is, that registration serves no purpose as the process was fundamentally flawed either through composition of the tribunal or some infection of error in relation to the conduct by the tribunal of its business.
[14] Pavic & Pavic;Braddon, and Blanco & Blanco (No.2) [2019] FCCA 2458 (’Blanco No 2’))
Those bases, I am satisfied, are also addressed in a paper under the hand of Justice Clyde Croft, Commercial Arbitration in Australia: The Past, The Present and The Future. [15] In particular, Croft J, on page 24 opines, in the context of section 36 of the Model Commercial Arbitration laws:
Amongst other things, an award can be set aside because the dispute is not covered by the arbitration agreement, there is not a properly constituted tribunal, the arbitration agreement is void, or the award is in conflict with the public policy of the state. The grounds are very narrow, and are unlikely to be successfully relied upon on a frequent basis.
[15] Justice Clyde Croft, ‘Commercial Arbitration in Australia: The Past, The Present and The Future’ Remarks to the Chartered Institute of Arbitrators, London, 25 May 2011
His Honour also had a number of germane comments that are prescient to this case and to which I will return.
If one looks to the relevant provisions of the Family Law Regulations (supra), some real support is given to my earlier interpretation in Pavic, Braddon and Blanco No 2 as to the grounds which might be argued to be available, in combination with that opined by Justice Croft and Parkinson as already referred to above. I am conscious that there is real value to be gained from considering each of those regulations, the offence or non-compliance with which would be a sufficient basis, I would think, to object to registration of an Arbitral Award. They comprise:
Regulation 67B, prescribed requirements for the arbitrator.
The section defines, by reference to section 10M of the Family Law Act (supra), the basis upon which a person can validly arbitrate (whether as a "private arbitration" under the Family Law Act (supra), or a "court-referred arbitration". I use both terms as Mr Pattison has specifically referred, throughout his material, to "private arbitration".[16] It is a separate species of arbitration to the arbitration that has occurred in this case, which is Court ordered. The Family Law Act (supra), in fact, provides a broader range of power to an arbitrator in a private arbitration - one which occurs without the involvement of the Court - than is available when arbitration is by Court referral under section 13E.
[16] Section 10L Family Law Act1975 (Cth) refers to “relevant property or financial arbitration”. The scope of matters that might be determined by arbitration in non-Court ordered arbitration is broader (see s.10L(2)(b))
In this case, there is no issue raised that the appointed arbitrator is other than an accredited arbitrator for the purposes of the regulations. The arbitrator is, most assuredly, listed upon the AIFLAM list, AIFLAM being the designated body to keep that list of accredited arbitrators.[17] Accordingly, if it could be established that the arbitral process has been conducted and the Arbitral Award delivered by a person who is not an accredited arbitrator, it would be a valid basis for objection to its registration (one of the grounds alleged by Mr Pattison). The Arbitral Award would be void. That could not be the case here.
[17] Family Law Act 1975 (Cth) s 10M, Family Law Regulations 1984 (Cth) r 67B
Regulation 67C dictates the matters that cannot be arbitrated.
Certainly, the referral of these proceedings falls squarely within that which is permissibly arbitrated by reference to the above regulation and sections 10L and 13E Family Law Act (supra).
Section 13E, itself, would be a basis for objection to registration of an Arbitral Award. Section 13E provides that a referral to arbitration can only occur with the consent of the parties. That is spoken to voluminously by Mr Pattison in his submissions. I will return to it. Suffice to observe, at this point, that I am satisfied that the referral to arbitration was by consent and, thus, no offence to the section.
Regulation 67F - The arbitration agreement.
It is difficult to comprehend how this regulation itself would directly give a basis for objection other than in two respects. Firstly, the regulation does not prescribe that a written arbitration agreement must be entered into. [18] However, it would be a foolish and foolhardy arbitrator who would be prepared to proceed on any basis other than a written arbitration agreement. The arbitration agreement is the basis for establishing the powers, duties of the arbitrator and the subject matter of the arbitration.
[18] Family Law Regulations 1984 (Cth), r 67F
Arbitration is, as Mr Pattison quite correctly submits, a contractual process. It is a consensual process by reference to section 13E. There is no power vested in the Court to compel arbitration over and above the objection of a party, and one would hope such a power would never be included within the Act. It would be contrary to some thousands of years of arbitration practice. It would also require that there then be a hearing de novo available to any participant[19] and, as was apparent at least in the early days of the NSW Arbitration scheme, an increase in the rate of applications for review or rehearing.
[19] Per Brandy v Human Rights and Equal Opportunities Commission (1995) 183 CLR 245
Returning, however, to the issue of the arbitration agreement, it would be a basis to object to registration of an Arbitral Award - as already touched upon by reference to regulation 67C and/or the terms of any order referring proceedings under section 13E of the Family Law Act - if the Arbitral Award were shown to deal with and purport to determine disputes that had not been referred to the arbitrator, or if the arbitration had been conducted in a manner or fashion contrary to that which was set out within the arbitration agreement. It is on that basis that a written arbitration agreement would be, to my mind, mandatory - certainly best practice, even though not mandated by the regulation.
In this case, of course, there is a written arbitration agreement. It is signed not by Mr Pattison, but by a Registrar of this Court pursuant to an Order made under section 106A of the Family Law Act (supra). Thus, the basis to gauge whether an arbitrator has acted within the terms of their reference and empowerment, the parties determining the arbitrator's powers as set out in an arbitration agreement, has some relevance. The arbitrator did so act.
Regulation 67G – Notice
This Regulation would also provide a basis for opposition or objection to registration of an Arbitral Award. The regulation requires that the arbitrator give each party written notice of certain information. That information is all, in this case, contained within the arbitration agreement (adopting the AIFLAM model agreement), and notice of the time, place and date fixed for the arbitral hearing has occurred. If it had not, it would be a valid ground for objection to registration as there would be a fundamental flaw in the arbitral process and a denial of due process.
It must be observed that the Arbitral Award, as well as eruditely setting out reasons in relation to the determination, sets out clearly, specifically, and in vast detail the steps taken by the arbitrator to facilitate due process to both parties in these proceedings. The Arbitral Award commences with those issues under the heading Preliminary Issue - The Arbitration, and then proceeds from page 7 through to page 13. On the basis of that recited within the Arbitral Award, there could be no suggestion whatsoever that due process was not afforded.
Section 67L - Termination of arbitration.
This regulation provides that arbitration is to be terminated if the arbitrator concludes that a party lacks or loses capacity to participate. That is not alleged in this case, but would be a valid basis for objection.
Regulation 67K - Suspension of Arbitration
This regulation permits an arbitrator to suspend arbitration if a party has failed to comply with a procedural direction given by the arbitrator. That is touched upon in the submissions of Mr Pattison. However, as will be explained - I hope tolerably so - that argument and submission is rejected.
An issue raised by Mr Pattison is that there has been a lack of disclosure provided in these proceedings by Ms Loomis. I will deal with that as a separate proposition to be addressed. However, I do not accept that his argument is validly made out or such as would either have required, compelled or even suggested to an arbitrator, acting reasonably within their powers, that suspension of the arbitration was necessary or warranted, or so as to allow any objection to registration of the Arbitral Award that follows.
Regulation 67I - Arbitrator’s Duties
This regulation would provide a basis for objection and validly so. There are four specific duties imposed upon the arbitrator therein, all of which would, if not complied with, sufficiently impeach the Arbitral Award so as to render it objectionable (as to its registration).
Subregulation (1) provides that the arbitrator must determine issues in accordance with the Family Law Act (supra). Any brief consideration of the Arbitral Award - and it has been read in detail and in full - makes clear that the Award, most assuredly, follows and complies with, and applies the relevant provisions of the Family Law Act (supra), as well as the Evidence Act1995 (Cth) and other relevant law and regulations.
Subregulation (2) provides that the arbitration must be conducted with procedural fairness. This is one of Mr Pattison's complaints, that the arbitral process was not sufficiently infused with procedural fairness to allow or permit registration of the arbitral award. For reasons that will be given, I reject the submission. However, a failure to afford procedural fairness to a party - in the example given within the subregulation, being a reasonable opportunity to be heard and to respond to anything raised by another party - would be a valid basis for objection to registration of the Award.
I am also conscious, in that regard, of that which fell from Kirby J in Allesch v Maunz [2000] HCA 40[20] particularly at paragraph 49. Therein, in the context of an application to reopen when an order had been made in the absence of a party - in this case, the arbitration proceeded on the same basis, in the absence of Mr Pattison - his Honour said:
If no reasonable explanation is given for the default [of appearance], it is not an injustice to deny the party in default a second opportunity to be heard. That opportunity is taken to have been waived or forfeited.
[20] (‘Allesch v Maunz’)
The closest one can come to ascertaining Mr Pattison's argument or reasonable excuse for non-participation in the arbitration - and it is common ground that there has been little, if any, participation since providing consent to referral - is that he perceived the process was not fair due to difficulties with disclosure. Those difficulties, which I will address separately as already indicated, are very limited. A number of orders have been made in these proceedings with respect to disclosure and on each occasion that the matter has come before the Court.
Mr Pattison has raised complaints regarding Ms Loomis' disclosure. What is clear and apparent in that regard is that the documents that Mr Pattison suggests Ms Loomis has failed to disclose or provide copies of to him are extraordinarily limited, comprising two specific documents, or classes thereof, as enumerated in the Orders made by this Court on 19 March 2019. Namely, a statement with respect to the wife's Complete Access account covering and disclosing transactions for the period 3 to 14 August 2018, and copies of statements of the wife's superannuation fund or funds covering the period October 2016 to February 2019. That Order was made on the date of referral of the proceedings to arbitration.
Subsequently, further Orders with respect to disclosure were made including on 25 June 2019. The wife, of course, asserts on oath that she has complied with her duty of disclosure, and provided each and every document that has been sought. Mr Pattison has had remedies available to him at all times during the course of these proceedings, and including in connection with the arbitration. He could have issued a subpoena. He could have participated in the arbitration, and sought to make application for suspension thereof on the basis of suggested non‑disclosure, both under the relevant Family Law Rules (supra) regarding disclosure in arbitration, or a direction given by the arbitrator. He could have objected to the tender of material. He could have tested the wife's evidence through cross-examination. His failure to do so is, I am satisfied, analogous to that discussed by Kirby J and referred to above.
Subregulation (3) of regulation 67I similarly addresses procedural fairness. The arbitrator must inform each party of any issue that arises with respect to bias. That, of course, is one of the allegations of Mr Pattison that the arbitrator is, to his perception, biased. I will deal with that complaint separately. At this point, I am concerned purely to identify that it is a reasonable and available basis to oppose registration of an Arbitral Award.
To that extent, the grounds that would found objection under the relevant regulations are identical to those grounds which arise under section 36 of the Model Commercial Arbitration laws and as discussed in Pavic. Accordingly, I am satisfied I can proceed on the basis of those grounds being available and relevant. Mr Pattison does not seem to agitate them all. I will turn to that shortly.
Complaints Regarding Disclosure
The history of the proceedings is somewhat relevant in understanding this complaint. This is not the first tranche of litigation between these parties. The parties had been involved, no doubt at the time of an earlier separation between them, in entering into consent orders. Orders were made by a Registrar in Chambers on 2 March 2007. Other than identifying their existence, they are not relevant. The parties clearly, thereafter, reconciled. Further transactions occurred, and there could be no controversy that this tranche of litigation, the second between these parties, is appropriately before the Court.
These proceedings were commenced by an Application Initiating Proceedings filed on 13 September 2018.
The matter first came before the court on 24 October 2018. By that date, Mr Pattison had, promptly and appropriately, filed a Response and his supporting material. On the first return date of the proceedings, Orders were made referring the parties to attend private family dispute resolution. Orders were made with respect to disclosure.
By the time the matter returned to the court for the second court event, 19 March 2019, mediation had not occurred. It seemed the parties had been deprived of that opportunity of facilitative dispute resolution as a consequence of their disputes with respect to disclosure. Accordingly, on that date, the Order already recited above was made requiring that the wife disclose two specific documents or classes of documents. The husband continues to complain that the wife has not done so. The wife asserts, on oath, that she has. The matter was also, importantly, referred to arbitration with the consent of both parties.
Mr Pattison asserts that his consent was conditional. No such thing is known or understood in the context of a referral to arbitration. Mr Pattison would suggest to the Court that his consent to arbitration was conditional upon the wife's compliance with the Order for disclosure. That is not the manner in which the Order is set out. In any event, it is addressed in not one, but two earlier judgments in these proceedings pre-dating this determination, those of 25 June 2019 and again on 18 September 2019. On each occasion, short reasons for judgment were delivered rejecting Mr Pattison's position.
Mr Pattison's position on each occasion had been fundamentally prefaced upon his assertion that his consent was withdrawn and, thus, the arbitration process was void and could not proceed. I will turn to that shortly.
On 25 June 2019, the parties again attended[21] - Ms Loomis legally represented, Mr Pattison representing his own interests. On that date, an Order was made requiring that each party do all things and sign all documents necessary to give effect to the terms of the Orders of 19 March, the referral to arbitration, and appointing a Registrar of the court, pursuant to section 106A of the Family Law Act (supra), to execute any document on behalf of a party in default, including execution of an AIFLAM arbitration kit model arbitration agreement on behalf of Mr Pattison, should he fail or refuse to do so, and in the event that the wife was able to demonstrate that she had requested its execution and it had gone unexecuted.
[21] from the 19 March, 2019 (listing the matter had been adjourned to 18 September, 2019, intended to be vacated on registration of an Arbitral Award).
During the intervening period, between 19 March and the second or subsequent date of 25 June 2019, it was also apparent that there was some controversy raised by Mr Pattison as to the appointed arbitrator. I refer to the arbitrator as "appointed" as:
a)The parties had been unable to reach agreement as to the arbitrator who would address their business; and
b)The Orders of 19 March 2019 provided that in the event that the parties were unable to agree as to an arbitrator that a request might be made in writing, by either party, to the President, for the time being, of AIFLAM seeking the appointment of an arbitrator. The arbitrator who was appointed corresponded with the arbitrator who had been proposed by Ms Loomis through her legal representatives, but nothing turns upon that.
The orders made in June 2019 also provided that the arbitrator appointed by the President of AIFLAM proceed with the arbitration in accordance with the standard AIFLAM arbitration agreement and, if necessary, to proceed on an undefended basis should Mr Pattison fail to participate in any pre-arbitration conference or the arbitration itself and/or should he fail to file material or comply with any other direction. The matter had come before the Court on that occasion, it would seem, at the behest of the wife's legal representatives to address the difficulties then apparent in advancing the arbitration.
That was an entirely appropriate step for those legal representatives to have taken, and the Court is authorised and empowered, under section 13F of the Family Law Act (supra), to make such orders as are necessary to facilitate the effective conduct of the arbitration (that is earlier discussed in Blanco No 2). The matter otherwise remained listed to 18 September 2019. By that date arbitration had still not proceeded.
Accordingly, on that date further Orders were made. Firstly, the matter was adjourned to today's date. Secondly, Orders were made as follows:
(1)Both parties, should they wish to participate in the determination of these proceedings by arbitration, shall attend with the named arbitrator on 11 October 2019, (being the date which had by then been advised and fixed by the arbitrator to conduct the arbitral hearing);
(2)Should either party fail to attend arbitration on 11 October 2019, the arbitrator is authorised and permitted to proceed to hear and determine the matter on an undefended basis and to, thereafter, deliver an arbitral award.
A further Order for costs was made.
What had also transpired in the intervening period is that a Registrar has, in fact, been called upon to again execute the arbitration agreement. That was undertaken by a Registrar in Chambers on 15 July 2019. Mr Pattison raises, by analogy, a complaint as to the ability of a Registrar to sign the arbitral agreement on his part. He is erroneous in his submission as a consequence of conflating consent to a referral to arbitration with doing what is necessary to then give effect to that referral.
The execution of the arbitration agreement by a Registrar is not the provision of consent other than to the agreed terms by which the arbitrator will be engaged, and the arbitration will proceed.
The arbitration agreement contains a number of important aspects for the purposes of dealing with and addressing the objection to registration of the arbitral award. Clause 2 of the agreement provides that the arbitrator is appointed on the terms and conditions contained in the agreement.
One of the complaints of Mr Pattison is that the President of AIFLAM had communicated to him, in some form, that the appointment of the nominated arbitrator was subject to agreement as to costs and conduct of the arbitration. Indeed, that is so. There is not, however, I am satisfied, any indication by the President of AIFLAM - for whom I have the greatest respect - that he is seeking to suggest there is some further step that must be taken or negotiated.
All that is intended, I have no doubt, in that communicated to Mr Pattison, is that the arbitration agreement will then set out those matters. There were already orders in place to provide for that to be so. The arbitration agreement, thus, sets out and determines the manner of conduct of the arbitration as well as the engagement of the nominated arbitrator.
The arbitration agreement provides, at clause 21, that the arbitration will be conducted as a full defended hearing. Indeed, that would have occurred had Mr Pattison sought to have engaged with the process.
The powers of the arbitrator are set out in clause 5 of the schedule to the arbitration agreement, and also make abundantly clear - lest the Orders of this Court were, in any way, uncertain - that the arbitrator is invested with a power to:
...continue with the arbitration on an undefended basis, and proceed to make an award if, after a mediation pursuant to subparagraph (m) hereof, one party decides not to participate further in the hearing. [22]
[22] Subparagraph (q) of schedule B to the arbitration agreement
Additional portions of the arbitration agreement similarly provide the power to proceed on an undefended basis. That is not to assume that there is no inherent power within the arbitrator to do so. I need not determine the issue, but I am satisfied that there is such an inferred and implied power. To take a contrary view would mean that arbitration could be put off and forestalled, rendered nugatory forever by - as Croft J referred to on page 23 of the article to which I have already referred:
A party wishing to avoid arbitration [who would have] an incentive to avoid or delay the appointment, or challenge process or processes in order to avoid any resulting deadlock, the court or possibly or another authority ... is given a supervisory role when agreement is not reached or when arbitrators are challenged, together with power to appoint or to decide any challenge. That is clear and express from section 13F of the Family Law Act.
Lest there be any further doubt that the Court has a role to play in the facilitation of arbitration, one need turn no further than the extra-curial writing of Rares J in his paper, The Role of Courts in Arbitration. [23] He is very clear as to the Court's role:
Arbitration, on the other hand, is a consensual dispute resolution process, and because it is consensual, parties to an agreement to resolve disputes by arbitration may need to resort to the courts to enforce incidence of their agreement. The court will usually become involved with arbitration at the time that either one party seeks to enforce the agreement to arbitrate a dispute while the other seeks to litigate it, or one party seeks the recognition or enforcement of an arbitral award. In this case, the court's intervention has been required for both.
[23] Justice Steven Rares, ‘The Role of Courts in Arbitration’ (4 August 2012) Federal Court of Australia
This is, in effect, the third determination by this Court to guide to conclusion the arbitral process. What his Honour is saying is spelt out expressly and clearly at paragraphs 39, 40 and 44 of the same paper, wherein, his Honour opines:
A reference of a matter, or part of a matter to arbitration by a consent order has the effect of empowering the arbitrator to try the subject matter of the reference. Once the Court-appointed arbitrator makes an award, a party to it may apply to the Court for a review of the award on the question of law ... This, is of course, quite a different role for the Court from that under the Model Law and for good reason. The Court‑appointed arbitrator will conduct a separate mode of trial of proceedings than are in the Court, just as if the proceedings are a separate question of being referred for a trial by a jury or a Court‑appointed referee.
I pause to observe that the arbitrator in this case is Court appointed, even though the Court has made an Order to provide a mechanism for the appointment. It is also germane to observe that section 13E of the Family Law Act (supra) makes clear that the arbitration is not a judicial process. It may have many of the hallmarks in that it is a decision‑making process, as is eruditely discussed in the balance of his Honour's paper. There are substantial differences between a judicial determination and mere dispute resolution, the most prominent of which is that arbitration is conducted confidentially and in private, and does not set precedent, whereas decisions of Courts do.
In paragraph 40, his Honour continues:
In Buckley v Bennell Design & Constructions Proprietary Limited,[24] Stephen J explained that the character of such a reference by the Court, to a referee or arbitrator, was as follows.
As Mr Quintin Hogg, as he then was, said in Law of Arbitration (1936), p 193, such a reference is ‘a species of trial, and the decision is now equivalent to a form of judgment or verdict and not an award.’ In such a reference, the court's procedures of adjudication are not abandoned in favour of extra-curial settlement of the dispute by arbitration. Instead, the court directs that for the better resolution of the particular proceedings initiated before it, resort should be had to the special mode of trial which the legislation has made available (emphasis originally added).
[24] (1978) 140 CLR 1
The prescient comment is the concluding paragraph - paragraph 44:
The Courts and arbitration have a symbiotic relationship in resolving ... disputes ... The courts can be expected to hold parties to their bargains to arbitrate their disputes. That role is an incident of the judicial function of enforcing rights and obligations according to law.
That is, perhaps, pivotal to the complaints re disclosure that are raised specifically by Mr Pattison in relation to the dispute.
In addition to the Orders that have been made with respect to disclosure, Parts 14 and 24 of the Federal Circuit Court Rules 2001 (Cth) have applied, together with rule 26B.01, .02 and .04 of the Family Law Rules 2004 (Cth). There have been a number of prior Orders and judgments, as already alluded to, in relation to disclosure. Ultimately, however, Mr Pattison has some responsibility in finalising that issue himself. Leaving aside that the wife contends that she has, in fact, complied and it has not been possible, on the evidence available, to determine where the truth may lie on that issue, there have been, as already observed, myriad opportunities for Mr Pattison to obtain the very few pieces of extant information he complains he has not received from his wife, including through the issue of subpoena and participation.
In turning to the specific complaints raised by Mr Pattison, I will address each individually. There are three in total.
The Arbitral Award or the arbitral process is void or voidable.
Mr Pattison does not specifically articulate the basis for this contention, although it can be discerned from his material. It would appear to be fundamentally founded in his objection to the appointed arbitrator, and his suggestion that he had, after the referral to arbitration on 13 March 2019, made with his consent, then withdrawn his consent, whether it was as a consequence of reconsideration or by reference to specific issues.
In that regard, I am conscious, particularly from the passages of Rares J’s article, above, that the appropriate point in time at which one has regard to consent is at the point of referral. It is not a matter for a party to consent to a referral and then change their mind. There may be circumstances in which this would warrant the court's discretionary intervention, but I am satisfied they would be - as Croft has discussed in the paper to which I have already referred, particularly pages 23 and 30 thereof - extremely limited intervention, and an even more limited philosophical basis for doing so.
As his Honour opines on page 30:
The judiciary plays an essential role in supporting and promoting arbitration. The majority of courts in developed arbitral jurisdictions are vested with at least some degree of supervisory supportive and enforcement jurisdiction over all forms of arbitration.
More importantly, however, as Rares J opines consistent with that at page 23 of Croft J’s article:
The Court may be called upon to enforce the bargain, to determine the rights and interests of these parties, those rights being created by the order made referring to arbitration.
That has already occurred twice, on 25 June and 18 September.
I am conscious of only one decision in the Family law jurisdiction that deals, in any slight fashion, with purported withdrawal of consent and the court's response thereto. That arises from a decision of Judge Jarrett in Maassen & Maassen.[25] Therein, his Honour was faced with a joint application by the parties where they each sought to withdraw their consent to arbitration, although it would seem one more so than the other. His Honour observes that both parties applied for an order that the arbitration be discharged. His Honour expressed curiosity as to the power of the Court to do so. A submission was put by the father referring to Part 27 of the Federal Circuit Court Rules (supra). That part of the Rules certainly provides a power in the Court to terminate the appointment of an arbitrator or an arbitration. As his Honour correctly observed, it is a portion of the Federal Circuit Rules (supra) that does not apply to proceedings under the Family Law Act (supra). His Honour observed, at paragraph 3, that there are a great many cases in the commercial arbitration field which tend to suggest where one party withdraws his or her consent to an arbitration that there may be litigation to force the arbitration, (indeed, that is the purpose of referral to the papers by Rares and Croft JJ - they clearly identify the precedents referred to by Judge Jarrett).
[25] [2018] FCCA 3683
Ultimately, his Honour was inclined to make the Orders sought with the consent of the parties, and accepted that the Court had an inherent jurisdiction in a supervisory role, as Croft J refers, to do so. I am satisfied that the Court does, in fact, have that power, though it should be used sparingly. However, no such application has been specifically made. There has simply been objection by Mr Pattison to the appointed arbitrator. I will deal with that in relation to the third ground of bias.
The relevant time in which one is to consider consent is, as I have already indicated, the time of referral. I have no doubt that the referral to arbitration was with Mr Pattison's consent. He does not suggest that there was duress such as to obviate or render void his consent. What he suggests is that his consent was “conditional”. He would only agree to arbitration if the wife gave full disclosure. It, perhaps, begs the rhetorical question as to what he would say if the matter were to be heard and determined by the Court and he, similarly, alleged that there was a failure of disclosure. Presumably, he would seek to withdraw from that process also although, of course, one need not consent or further consent to the judicial determination of dispute. Consent is inherently provided due to the nature of a democratic society, and through being a member and participant therein.
I accept that there may be circumstances in which the withdrawal of consent would be valid and upon which the Court would act. This is no such case. The only two complaints that are, in any way, referrable are those with respect to disclosure and those with respect to imputed bias of the arbitrator. Each is rejected.
The documents that are suggested to have not been disclosed are modest at the very least. However, as is submitted by Mr Pattison in his affidavit, “there is no such thing as 75 per cent or 90 per cent disclosure, only full and frank disclosure”. But, of course, that is to ignore that Mr Pattison is, in this case, an instrument of his own destruction as a consequence of the attitudes that he has adopted and his withdrawal from the proceedings. It has always been within his power to proceed to obtain the material which he alleges is so relevant and has not, he alleges, been provided (although the wife suggests it has been). Accordingly, I am not satisfied that either the arbitration process, the referral to arbitration, or the arbitral award are void or voidable.
Fraud
It is unclear what is intended by the allegation that the arbitral process is infected by fraud, save and except the issues of alleged non‑disclosure. I, again, do not accept the submission. There could be no positive finding that the wife has failed to give the disclosure that was sought, or has failed to comply with the Orders made by this Court, or any direction given by the arbitrator. Even if it was so, Mr Pattison has had, at all times after many months, remedies available to him. He may have subpoenaed the material, for example.
Failing to act to assist himself cannot then be a ground that he can rely upon as a bar to the matter proceeding. It is in that regard analogous to the circumstances, as I have already referred to, discussed in Allesch v Maunz as well in a number of other authorities, including Harper & Harper[26], (paragraphs 31 to 37 thereof), and Mallard & Mallard[27], (paragraphs 90 to 92) - applications dealing with and referring to reopening when an order was made in a party's absence. The appropriate response, on the part of Mr Pattison, was not to simply refuse to cooperate, in any fashion, with the process. That is simply to create a bar, to adopt the language of Kirby J referred to above, to any complaint of injustice.
[26] [2016] FCCA 1603
[27] [2011] FamCA 876
To that end, I am not satisfied fraud could possibly be established. And lest there be any further controversy in that regard, I have had regard to, and rely upon the joint decision of Gaudron, McHugh, Gummow and Hayne JJ at paragraph 27 of Allesch v Maunz, and upon paragraphs 35 to 36, 38 to 40, and 48 to 50, together with paragraph 53 of Kirby J’s individual decision in the same case.
Bias
That leaves, then, the third and weakest ground, that of bias. Mr Pattison asserts, as he has in relation to each of the earlier determinations, that the appointed arbitrator would, to the reasonably minded lay observer, be infected by a perception of bias. The singular basis upon which that is advanced is that the arbitrator's rooms are within a reasonable geographical location of the offices of the wife's solicitors. The wife's solicitors' office is, curiously, equidistant to the arbitrator's rooms and this Court.
That is the only basis Mr Pattison has ever raised as to an imputation of bias of the arbitrator. The arbitrator happens to be within a few hundred metres of the wife's lawyers. There is no suggestion of any personal relationship, any predisposed view, or anything else at all. It is a nonsense, as has been made abundantly clear in each of the prior determinations when that issue has been raised. It is on that basis that I am satisfied that ground also must fail.
Conclusion
Accordingly, I am not satisfied that Mr Pattison has established any valid or rational basis for objection to registration. Thus, I am compelled to register the Award having been satisfied, as above, that the Application for registration was filed more than two months ago and that service was effected more than 28 days ago.
The Costs Issue
At the conclusion of the determination of this Application, an Application is made by the wife for a contribution towards her costs. I preface the application in those terms as the costs that are sought are party/party costs in accordance with schedule 1 of the Federal Circuit Court Rules (supra). Those costs would not represent, in all probability, the totality of costs incurred by the wife in responding to, and addressing this application.
Costs, of course, are dealt with under section 117 of the Family Law Act (supra).
Subsection (1) creates what is often referred to, including by the High Court in Penfold & Penfold (1980) 144 CLR 311, as the general rule.
Subsection (2) reserves the discretion to the court to make an order for costs if the dual test, (see Re JJT & Ors; Ex Parte Victoria Legal Aid [1998] FLC 92-812 ) of justification and justice are met. In determining whether those tests are met, the Court must have regard to the prescriptive, but non-exhaustive list of considerations in subsection (2A). Subsections (3), (4) and (5) are not relevant to this determination, dealing as they do with applications by and involving independent children's lawyers or child welfare authorities.
In dealing with each of the subsection (2A) considerations, some understanding of the position is gained.
The Financial Circumstances of the Parties
This is not specifically known at this point, nor need it be. Both parties are privately funded, and both parties have or will, as a consequence of the Arbitral Award, have available to them a capital sum. The Arbitral Award has already reduced the payment that is to be made by Ms Loomis to Mr Pattison by reference to deduction of earlier costs Orders made by this Court, two in total, together with one half of the arbitration fee. Thus, it would further erode the position of either party if costs were required to be paid by them.
Of course, in these proceedings, Mr Pattison has been self-represented throughout. Ms Loomis has been legally represented throughout. Thus, she has incurred cost on each and every occasion, and with respect to each step in the proceedings which Mr Pattison has been free of. Some of those costs, including the costs with respect to this application and today's attendance, have arisen as a consequence of a lack of appropriate advice and guidance as to that which would occur.
Financial circumstances would not form justification for costs. However, they do speak to the issue of justice and in support of an order.
Whether a Party is in Receipt of Legal Aid
Neither is.
The Conduct of the Parties in Relation to the Proceedings Including with Respect to Discovery and Other Matters
The complaints with respect to disclosure are addressed above and need not be revisited. There has, and always has been, a ready and available means of address - in fact, several of them - to the complaints raised by Mr Pattison. He has simply chosen to not pursue them.
Whether that is because he has been reliant upon himself as an advisor and has not been aware of those options, he has been aware of them and chosen not to pursue them or any other basis cannot be determined. Suffice to observe that the dispute in relation to discovery was a very limited quantum, and of very little moment in the determination of these proceedings.
Whilst there is complaint raised that the arbitrator did not compel Ms Loomis to provide those documents, there was no basis for the arbitrator to do so. Mr Pattison was not engaged with the process, and did not agitate for that relief.
Beyond that issue, there is then the complete withdrawal and disengagement from these proceedings by Mr Pattison from a very early stage, sometime very shortly after the referral to arbitration on 19 March 2019, some 10 months ago. Since that time, there have been three Court events. There have been two attendances upon a Registrar to have documents signed which can and should have been signed by Mr Pattison, and all of the costs involved therewith. In all of those circumstances, I am satisfied that Mr Pattison's conduct would justify consideration of an order for costs.
Conduct
I have dealt with that above.
Whether the Proceedings Were Necessitated by the Failure of a Party to Comply with Previous Orders
This is not particularly germane. These proceedings arise on the basis of the application made by Mr Pattison objecting to registration of the Arbitral Award.
Put as bluntly as it can be, the application was ill-advised, ill-informed and without foundation.
Whether a party has been wholly unsuccessful
Mr Pattison has been, in the most spectacular terms. One need only look to the third ground, that which has been raised, on three separate occasions, that the arbitrator is biased because his office is within a certain geographical distance of the office of the solicitors for the wife. It was a nonsensical argument in May 2019. It is even more nonsensical today.
The allegation obviates against any suggestion of professionalism on the part of the arbitrator. It simply could not have been maintained, and the fact that it had been raised and dismissed in two prior judgments might have given an inkling of its relative success today. In those circumstances, I am also conscious of the Full Court's decision the Davida & Davida (Costs)[28]. One can have regard not only to relative lack of success, but the success of the other party, taking into account, if need be, subsection (g).
[28] [2011] FamCAFC 61
Ms Loomis has obtained what she sought to obtain. She has been aided and abetted by Mr Pattison in obtaining the substantive relief that she sought by his non-engagement in the process.
Whilst he complains that the award that is delivered by the arbitrator is manifestly unreasonable, there is no application for review. So I need not specifically pursue the issue, save to observe that the Arbitral Award is well reasoned, clear, concise, and referable and responsive to the evidence that was led, and it was unchallenged. That result was almost assured by Mr Pattison's failure to participate.
If there were matters to raise in complaint as to the veracity of Ms Loomis' evidence, the time to do so was at the arbitral hearing, what was described to be conducted as a full defended hearing, but which proceeded undefended.
In that regard, I am satisfied that Ms Loomis has been wholly successful. Mr Pattison has been wholly unsuccessful, and the costs that have been incurred by Ms Loomis today should not be solely borne by her. They will be borne by her in part. I am again satisfied costs, in accordance with the scale, will be but a contribution.
Whether a Party Has Made an Offer in Writing
This is unknown. What is known, however, is that an application for registration was filed and, effectively, at the twelfth hour, immediately before the expiration of the 28 day disallowance period - for want of a better description - the objection was then raised. It has, thus, put on hold the registration of the Arbitral Award for a period in excess of a month, and further delayed compliance therewith. That has been to the mutual disadvantage of both parties as Ms Loomis has not been able to fully realise the fruits of her litigation, nor has Mr Pattison received any funds that might have otherwise been required to be paid to him.
The Arbitral Award is, thankfully, prefaced in a fashion wherein there is no real prejudice to Ms Loomis. She is required to pay a sum certain, conditional upon a transfer to her by Mr Pattison of his interest in the home. Accordingly, the amount of payment to be made by Ms Loomis will be unaffected by the delay.
For those reasons, I am satisfied that there is justification for an order for costs. I am satisfied that it is just that an order be made. I am satisfied that it would be unjust if an order were not made. A litigant is entitled to the fruits of their litigation, and in circumstances such as these, where the only reason for delay, and the only reason that the parties are before the Court day is a baseless application which has found no favour, then it would be a gross injustice to impose those costs solely upon Ms Loomis.
In determining the quantum of costs, I am obliged, by Division 21 of the Federal Circuit Court Rules (supra), to have regard to Schedule 1, the indicative event-based scale of costs. The costs that are sought per Exhibit A are modest. They represent the daily hearing fee, an advocacy loading, some provision for instructing a solicitor, and the taking of judgment today, albeit all contained within the same day. The total sought is $5,909. That is, perhaps, less than could be extracted if one were more creative with the indicative scale.
On the basis that there was an application to oppose registration, albeit oral and contained within an affidavit, item 1 would apply. If one were to include that, the costs would begin rapidly to exceed that which is sought. It is not a criticism. It is an appropriate application and an appropriate quantum that is put. However, by reference to those comments, it must be seen that the quantum is entirely reasonable.
Accordingly, Orders are made as follows.
I certify that the preceding one hundred and seventeen (117) paragraphs are a true copy of the reasons for judgment of Judge Harman
Date: 17 March 2020
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