McGough v Minister for Finance
[2021] FCCA 290
•17 February 2021
FEDERAL CIRCUIT COURT OF AUSTRALIA
McGough v Minister for Finance [2021] FCCA 290
File number(s): PEG 216 of 2020 Judgment of: JUDGE LUCEV Date of judgment: 17 February 2021 Catchwords: ADMINISTRATIVE LAW – Judicial review – refusal to authorise an act of grace payment
ALTERNATIVE DISPUTE RESOLUTION – Requirement for Court to consider if alternative dispute resolution may help resolve the dispute – factors which may help resolve dispute – obligation to advise parties to use alternative dispute resolution
PRACTICE AND PROCEDURE –– Whether proceedings to be adjourned pending mediation – relevant factors for consideration
WORD AND PHRASES – “may help” – “must” – “must advise”
Legislation: Federal Circuit Court of Australia Act 1999 (Cth), ss 3(2)(c), 22, 23, (1) and (2), 24, 42 Cases cited: Australian Fisheries Management Authority v PW Adams Pty Ltd (1995) 61 FCR 314, (1995) 22 AAR 261, (1995) 134 ALR 51
Boston Commercial Services Pty Ltd v GE Capital Finance Australasia Pty Ltd [2006] FCA 1352, (2007) 236 ALR 720, (2006) 70 IPR 146
Broad Spectrum Training Pty Ltd & Ors v Bidding Buzz Pty Ltd & Ors [2010] FMCA 932, (2010) 244 FLR 335
Director of Public Prosecutions (Vic) v Drage (1993) 17 MVR 390
Julstar Pty Ltd v Hart Trading Pty Ltd [2014] FCA 108
Kosovich v Mancini (1982) 31 SASR 272
Posner v The Collector for Inter-state Destitute Persons (Vic) [1946] HCA 50, (1946) 74 CLR 461, [1947] VLR 276, [1947] ALR 61, (1946) 20 ALJ 444
Number of paragraphs: 18 Date of last submission/s: 17 February 2021 Date of hearing: 17 February 2021 Place: Perth Counsel for the Applicant: The Applicant appeared in person Counsel for the Respondent: Ms S Oliver Solicitor for the Respondent: Ms Solene Yik Long ORDERS
PEG 216 of 2020 BETWEEN: LINDA MCGOUGH
Applicant
AND: MINISTER FOR FINANCE
Respondent
ORDER MADE BY:
JUDGE LUCEV
DATE OF ORDER:
17 FEBRUARY 2021
THE COURT ORDERS THAT:
1.The further hearing of this part heard matter be adjourned pending mediation in accordance with Order 2.
2.The matter be relisted for mediation before a Registrar of this Court on a date to be fixed by that Registrar.
3.If the matter is not resolved at mediation, the matter be listed for a further directions hearing before Judge Lucev on a date to be fixed.
4.Costs of today be reserved.
REASONS FOR JUDGMENT
(Delivered ex tempore and revised from transcript)JUDGE LUCEV
The task of a Chapter III federal court has often been said by the Federal Court to be to resolve disputes or quell controversies: see, for example, Boston Commercial Services Pty Ltd v GE Capital Finance Australasia Pty Ltd [2006] FCA 1352, (2007) 236 ALR 720, (2006) 70 IPR 146 at [47] per Rares J, Julstar Pty Ltd v Hart Trading Pty Ltd [2014] FCA 108 at [82] per Greenwood J. In aid of that task, the legislature has enacted provisions in the Federal Circuit Court of Australia Act 1999 (Cth) (“FCCA Act”) dealing with the nature of the duty and requirements to undertake the use of dispute resolution processes, in particular for these purposes ss 22, 23 and 24 of the FCCA Act.
Section 24 of the FCCA Act provides:
A legal practitioner in proceedings in the Federal Circuit Court of Australia or consulted by a person considering instituting such proceedings must consider whether or not to advise:
(a) the parties to the proceedings, or
(b) the person considering instituting proceedings;
about the dispute resolution processes that could be resolved to resolve any matter in dispute.
The Court notes from the exchanges with Counsel for the Minister for Finance that the legal practitioners acting in these proceedings for the Minister for Finance, and acting effectively for the Commonwealth as a model litigant, have not considered whether to advise the Minister for Finance about the use of dispute resolution processes. Their failure to do so would appear to be contrary to what appears to be the mandatory duty to do so by reason of the use of the word "must" in s 24 of the FCCA Act: see Posner v The Collector for Inter-state Destitute Persons (Vic) [1946] HCA 50, (1946) 74 CLR 461, [1947] VLR 276, [1947] ALR 61, (1946) 20 ALJ 444 (“Posner”) CLR at 490 per Williams J and Kosovich v Mancini (1982) 31 SASR 272 (“Kosovich”) at 275 per Millhouse J. The obligation imposed by the use of the word "must", in this context, means that there is a necessity to consider on the part of a legal practitioner whether or not to advise in this case the Minister for Finance, and ultimately because of subpara-(a) of s.24 of the FCCA Act, also Ms McGough, about the use of dispute resolution procedures which could be used to resolve the matter.
Section 22 of the FCCA Act provides that:
The Federal Circuit Court of Australia must consider whether or not to advise the parties to proceedings before it about the dispute resolution processes that could be used to resolve any matter in dispute.
That obligation would again appear to be mandatory in nature because of the use of the word "must", and the Court has to therefore consider whether or not to advise the parties about dispute resolution processes that could be used to resolve this matter: Broad Spectrum Training Pty Ltd & Ors v Bidding Buzz Pty Ltd & Ors [2010] FMCA 932, (2010) 244 FLR 335 (“Broad Spectrum”) at [35]-[39] per Lucev FM. The Court notes that there has only been one Court date prior to today, that being a first Court date on 1 September 2020, at which the matter was listed for hearing. There was no referral for mediation, and it is not apparent what, if any, consideration might have been given by the Court to the use of mediation. There is, therefore, and in any event, an obligation presently on the Court by reason of s 22 of the FCCA Act to consider whether or not to advise parties about dispute resolution procedures that could be used to resolve the matter. The Court raised and discussed that matter with the parties in the hearing in the context of mediation in an endeavour to resolve the issue in this litigation by a Registrar of this Court.
Section 23 of the FCCA Act reads as follows:
(1) If the Federal Circuit Court of Australia considers that a dispute resolution process may help the parties to a dispute before it to resolve that dispute, the Federal Circuit Court of Australia must advise the parties to use that dispute resolution process.
(2) If the Federal Circuit Court of Australia does so advise the parties, it may, if it considers it desirable to do so, adjourn any proceedings before it to enable attendance in connection with the dispute resolution process.
The question is whether a dispute resolution process may help in these proceedings in the resolution of the dispute, and in that regard, the Court refers to Broad Spectrum at [29] per Lucev FM, where the Court said:
The words "may help" appear in the context of the dispute resolution processes being discussed under section 23(1) of the Act. In this context:
(a) "may" expresses a subjective possibility that the dispute resolution process might help resolve the dispute; and
(b) "help" means a thing, in this case the dispute resolution process, which may make more effectual or aid the resolution of the dispute.
(Footnotes omitted)
The Court notes that both parties were not unwilling to enter into mediation by a Registrar of this Court, and that the Minister for Finance as a Commonwealth entity and a model litigant ought to be disposed to settlement of matters by means of dispute resolution processes if possible, and Counsel for the Minister quite properly conceded that this was a case which might be resolved, or which might be endeavoured to be resolved, by mediation before a Registrar of the Court. Given the nature of the matter, the Court does consider that there is some scope for settlement by means of a dispute resolution processes, in this case, mediation before a Registrar of the Court.
There is nothing in the subject matter which means that it is unsuitable for resolution by dispute resolution processes, although as the Court observed in the course of hearing, it might be that there have not been many or any mediations of act of grace payment cases. In the Court's view, and the Court can express a view about the quantum claimed by Ms McGough in this case because ultimately the Court will not have any role in determining that quantum, the quantum claimed by her, namely $3 million as an act of grace payment, provides ample scope for resolution by mediation, particularly so given that the quantum has perhaps an air of unreality about it. That says nothing about the circumstances giving rise to the claim or Ms McGough's feelings or her endeavours to resolve the matter previously, simply that that seems to be a rather large sum in the context of these type of proceedings as a matter of objective fact. A Registrar might in dispute resolution procedures be able to persuade the parties to agree on an appropriate sum, if not as an act of grace payment, simply to settle the litigation, and as the Court observed in the course of exchanges during the hearing, there are other means by which a case of this type might settle, not limited to certain kinds of acknowledgements or apologies from appropriate persons, not necessarily limited to the Minister of Finance per se.
One other factor which has exercised the Court's mind, particularly in the context of the volume of documents already filed and the possibility that there might be other documents which might need to be considered if the matter is ultimately to be the subject of a determined judicial review application by this Court, is that a Registrar might be able to narrow the scope of the litigation. Much of what has been put before the Court presently bears the hallmarks of merits review of the administrative decision, rather than judicial review of the administrative decision, and if there can be some narrowing of the scope of those documents through mediation, that would ultimately be of assistance to the Court.
In relation to costs, the possibility of settlement means that the actual costs of a judicial review hearing, save for the costs of today, need not be incurred. There might also be, by reason of the matters the Court has just adverted to, some saving to the taxpayer in terms of the cost of the Court traversing bundles of documents and affidavits already filed, and prospectively to be filed, in the course of preparation of a judgment, and thereby a reduction in those costs and a more efficient disposition of the matter. The Court also notes, given the current attitude of the parties, as has been expressed in some fairly forceful passages of Ms McGough's affidavit of 25 September 2020 which has been tendered and is in evidence, and the views expressed frankly by Counsel for the Minister today, that even if the matter does go on judicial review before this Court, that might not be the end of it and there may be other Court proceedings, the costs of which might need to be considered as a saving if the matter were to go to mediation and be resolved.
Having reached the conclusion, therefore, that mediation may help the parties to resolve this dispute, the Court considers that s 23(1) of the FCCA Act therefore places an obligation on the Court to advise the parties to use a dispute resolution process, in this case, mediation, which may help resolve their dispute, and that obligation arises by use of the phrase "must advise": see Broad Spectrum at [35]-[44] per Lucev FM, Posner CLR at 490 per Williams J, Kosovich at 275 per Millhouse J, Australian Fisheries Management Authority v PW Adams Pty Ltd (1995) 61 FCR 314, 22 AAR 261, 134 ALR 51, FCR at 332 per Sheppard J (with whom Tamberlin J at 334 and Lehane J at 336 agreed), and Director of Public Prosecutions (Vic) v Drage (1993) 17 MVR 390 at 391-392 per Tegue J.
The Court, having concluded that mediation may help the parties resolve their dispute and advised the parties to use that dispute resolution process, has a discretion to adjourn the proceedings to enable attendance in connection with the dispute resolution process if the Court considers it desirable to do so: s 23(2) of the FCCA Act. Having referred already to the apparent willingness of the parties to consent to mediation, the fact that there is some prospect of the matter resolving through mediation, and the fact that it would be much better if it did resolve at mediation rather than being the subject of ongoing litigation in this Court and possibly elsewhere, and the fact that in the context of this being a judicial review application, and without expressing any merits as to that judicial review application, that the outcome of such a judicial review application is a win-loss scenario for both parties, the Court is of the view that it is desirable that these proceedings, now presently part-heard, be adjourned. As the Court has already indicated, if nothing else, the Court suspects that a Registrar might be able to narrow the scope, if not of the ultimate issue for determination, then perhaps of the material to be considered by the Court, much of which, as the Court has either already said appears, at first blush, to be related to merits review rather than judicial review.
In terms of the length of mediation and any delay to these proceedings, the Court notes that the matter has been listed for hearing today and has been so listed since the first Court date on 1 September 2020. It is, however, a matter which in relative terms has been listed for hearing quite quickly, that is, listed seven months since the judicial review application was originally filed, and therefore a referral to mediation will not be a process which results in it being unduly delayed, in relative terms, considering the normal run of cases in this Court. The Court also notes that the subject matter which lies behind the judicial review application and the events giving rise to the act of grace payment application are more than a decade old, and in that context, an adjournment of these proceedings to allow mediation and the consequent short delay will not be overly burdensome in all of the circumstances.
The mediation in the Court will not impose substantial additional costs on either party, certainly not on Ms McGough as she does not have legal representation, and only minimal costs, relatively speaking, for the Minister for Finance. As the Court has already observed, the Court considers that an experienced Registrar may be able to ameliorate the forceful views which have been expressed already in the course of these proceedings and in the course of the events leading to these proceedings, with a view to effecting a settlement in some manner, way, shape or form, and in that regard, the Court notes, as it did during the course of the proceedings, that the level of resolution at mediation in general federal law proceedings by Registrars in the Perth Registry exceeds, as the Court understands it, 60 percent of the cases which are referred for mediation, and, in fact, may be a much higher figure than that.
In the circumstances, the Court considers it is consistent with the intent of ss 22, 23 and 24 of the FCCA Act that the matter be referred, even at this stage, for mediation, and that it is also consistent with the objects of the FCCA Act expressed in ss 3(2)(c) and 42 of the FCCA Act to encourage the use of a range of appropriate dispute resolution processes, that the matter be referred for mediation.
Having regard to the matters and factors that the Court has set out above, the Court has concluded that mediation may help the parties to resolve their dispute, and that the matter ought therefore be referred to for mediation before a Registrar of the Court.
The Court will make the following orders:
(a)The further hearing of this part heard matter be adjourned pending mediation in accordance with Order 2.
(b)The matter be relisted for mediation before a Registrar of this Court on a date to be fixed by that Registrar.
(c)If the matter is not resolved at mediation, the matter be listed for a further directions hearing before Judge Lucev on a date to be fixed.
(d)Costs of today be reserved.
I certify that the preceding eighteen (18) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Lucev. Associate:
Dated: 18 February 2021
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