Murex Diagnostics Australia Pty Ltd v Chiron Pty Ltd & Anor Chiron Corp v Murex Diagnostics Australia Pty Ltd

[1996] FCA 782

CATCHWORDS

PRACTICE & PROCEDURE - apprehended bias - difference between Australian and English statement of the principle - application to an expert sitting as scientific adviser with a court.

MUREX DIAGNOSTICS AUSTRALIA PTY LIMITED -V- CHIRON PTY LIMITED & ANOR

CHIRON CORPORATION -V- MUREX DIAGNOSTICS AUSTRALIA PTY LIMITED & ORS

NG 106 of 1994

Burchett J.
Sydney
21 August 1996

IN THE FEDERAL COURT OF AUSTRALIA )  
  )
NEW SOUTH WALES DISTRICT REGISTRY )    NG 106 of 1994
  )
GENERAL DIVISION                 )

BETWEEN:MUREX DIAGNOSTICS AUSTRALIA PTY LIMITED

Applicant

AND:CHIRON PTY LIMITED

First Respondent

AND:     ORTHO DIAGNOSTIC SYSTEMS, INC.

Second Respondent

AND BETWEEN:  CHIRON CORPORATION

Cross-Claimant

AND:     MUREX DIAGNOSTICS AUSTRALIA PTY                     LIMITED

First Cross-Respondent

AND:     SPECIALIST DIAGNOSTICS LIMITED (IN   LIQUIDATION)

Second Cross-Respondent

AND:     INTERNATIONAL MUREX TECHNOLOGIES                    CORPORATION

Third Cross-Respondent

CORAM:    Burchett J.
PLACE:    Sydney
DATE:     21 August 1996

REASONS FOR JUDGMENT

BURCHETT J.:

Murex (as I shall call the Applicant) issued a notice to produce covering certain documents relevant to the relationship between Chiron Corporation (Chiron) and a

Dr Brenner.  Chiron has taken out a motion to set this notice to produce aside.  The basis on which the motion is brought is that the documents, it is said, cannot be relevant to any question reasonably arising in the case.  Counsel accepts that he has to go that far, and that the onus resting on Chiron is similar to that arising in a case to which the principle of General Steel Industries Inc. v Commissioner for Railways (NSW) (1964) 112 CLR 125 applies.

The issue put forward by Murex, which Chiron thus seeks to dismiss out of hand, relates to the role of Dr Brenner as scientific adviser to Aldous J, and later as scientific adviser to the Court of Appeal, in the English proceedings concerning the United Kingdom equivalent of the patent with which I am concerned.  Murex points out that, in his opening in the present case, senior counsel for Chiron relied on the English decision, not only as determining, at least persuasively, legal questions, but also as persuasive on matters of fact.  Furthermore, there is a pleading which may or may not properly raise certain questions of issue estoppel founded upon the English judgment.  That pleading has not been abandoned, and indeed, if it is not effective, counsel for Chiron has indicated an intention to seek leave to amend Chiron's pleadings to replace it with an effective allegation of the same kind.  Counsel for Murex says that, if the English case is to be relied on at all, he should be entitled to impugn it for bias or the appearance of bias.

On behalf of Murex, evidence has been tendered on the motion to show prima facie that Dr Brenner, while adviser to one or both of Aldous J and the Court of Appeal, was sitting, as a director, on the board of a company, together with the President and founder of Chiron, which owned a significant part of the shareholding of the company in question; that this company, to which Dr Brenner was also a scientific consultant, had a collaboration agreement with Chiron; and that Dr Brenner stood to gain financially, to some degree, from that collaboration, and from his association with the company.  In this situation, Murex says that the principle of apprehended bias, as understood in Australia, would apply to bar Dr Brenner from participating, even though merely as a scientific adviser, in the internal deliberations of a court in which Chiron was litigating matters close to the collaboration in question.

Reference was made by counsel for Murex to some words with which the judgment of the Court of Appeal, which is reported, but not fully, in (1996) Fleet Street Reports at 204, was brought to a conclusion.  These particular words, for some reason, were omitted from the report in the Fleet Street Reports.   They are:

"In short without him" -

I interpolate that is Dr Brenner -

"in this unfamiliar field our understanding of the facts would have been insufficient."

It is accepted that Murex's point was raised in the Court of Appeal, and that it was rejected.   But it is suggested that the law in England is not identical with that in Australia on this point, and that in any case rejection on the facts then known should not bar the raising of the matter on such facts as may be ascertained now.  It should be appreciated, counsel argue, that the appearance in question here is not just of Dr Brenner sitting with the President and founder of Chiron; but of his being a director of a company which had a concern in the development of patents, so that, it is urged, there may be an appearance of his having been both pro Chiron and pro the interests of patentees in general.

In considering the question thus put before me, I have had regard to some of the case law in Australia which has referred to a possible difference between the law in Australia and the law in England in this particular respect.  I referred to some of the decisions, and particularly to the decision of the High Court in Vakauta v Kelly (1989) 167 CLR 568, in Australian and Overseas Telecommunications Corporation Limited v McAuslan (1993) 47 FCR 492 at 494-495. I there drew attention to the fact that, in Vakauta v Kelly, Brennan, Deane and Gaudron JJ made it plain they considered the judge with whom that decision was concerned would not have been biased in fact; but they nevertheless held, at pp.573-574 of the report, that his comments were such as "to cause 'reasonable
apprehension' on the part of a lay observer that the judgment itself was, 'in the end', affected by bias."  I went on to refer to the accepted test in England of "a real danger of bias" or "a real danger of injustice", being the test laid down by the House of Lords in The Queen v Gough [1993] AC 646 at 670 and 673. In Vakauta v Kelly, in another passage at 571, Brennan, Deane and Gaudron JJ spoke of preconceived views that "could threaten the appearance of impartial justice."  The principle that was adopted was that stated in Livesey v The New South Wales Bar Association (1983) 151 CLR 288 at 293-294:

"(A) judge should not sit to hear a case if in all the circumstances the parties or the public might entertain a reasonable apprehension that he might not bring an impartial and unprejudiced mind to the resolution of the question involved in it."

In another judgment of my own, which is unreported, Carr v McDonalds Australia Limited, delivered on 21 October 1994, I referred to a decision of the Court of Appeal of New South Wales in Australian National Industries Ltd v Spedley Securities Ltd (in Liq) (1992), 26 NSWLR 411, where the then president, now Kirby J of the High Court, referred (at 419) to:

"(T)he stringency which is required, by decisions of the highest courts, of all those who exercise judicial office or have equivalent functions in Australia.  Although it was formerly necessary to demonstrate a 'probability' or 'real likelihood' that a reasonable observer would apprehend bias by pre-judgment on the part of the judicial officer concerned, such is not now the case in this country.  By repeated decisions of the High Court the test is now expressed in terms of possibilities, that is, whether the parties or the public 'might entertain a reasonable apprehension that the judge might not bring an impartial and unprejudiced mind to the resolution of the question involved' ... ".

In my opinion, having regard to these statements of the law, the point raised by Murex cannot be rejected without a hearing as hopeless.  So to hold, of course, is not to say that ultimately it will find favour with this or any other court.  That is a matter which can only be determined when the full circumstances which the parties choose to put before the court are known.  But the point simply cannot get a hearing, at least a hearing of the kind for which our procedures provide, unless the notice to produce is enforced. 

I do not think that Mr Catterns's failure to cite authority in support of apprehended bias, as distinct from fraud, as a vitiating factor in respect of the binding force of a judgment, is necessarily fatal to the point.  I think that the point, if pursued by the parties, can only be determined after all the evidence that is to be tendered upon it has been heard.  Accordingly, I dismiss the motion and I direct that the notice to produce be answered.

I desire to add that, after my reasons had been delivered ex tempore, Mr Catterns did cite the following authority with respect to the avoidance of a judgment upon a relevant ground
other than fraud: Jet Holdings Inc. v. Patel [1990] 1 QB 335 at 345.

I certify that this and the preceding six (6) pages are a true copy of the Reasons for Judgment herein of his Honour Justice Burchett.

Associate:

Date: 3 September 1996

Counsel for the Applicant and        Mr D.K. Catterns QC

the First Cross-Respondent:      and Miss K.J. Howard

Solicitors for the Applicant     Banki, Palombi,

and the First Cross-Respondent:   Haddock & Fiora

Counsel for the Third            Dr A.C. Bennett SC and

Cross-Respondent:                Miss K.J. Howard

Solicitors for the Third             Banki, Palombi,

Cross-Respondent:                Haddock & Fiora

Counsel for the First and        Mr F.M. Douglas QC
     Second Respondents and the       and Mr A.J. Bannon
     Cross-Claimant:

Solicitors for the First and
     Second Respondents and the
     Cross-Claimant:                  Allen Allen & Hemsley

Date of hearing:                 21 August 1996