Protel Communications International Pty Ltd v Chen and Anor and Saise Pty Ltd v Chen and Anor
[2007] FMCA 1135
•17 July 2007
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| PROTEL COMMUNICATIONS INTERNATIONAL PTY LTD v CHEN & ANOR and SAISE PTY LTD v CHEN & ANOR | [2007] FMCA 1135 |
| PRACTICE AND PROCEEDURE – TRADE PRACTICES – Stay of proceedings – stay pending criminal proceedings – relevant considerations – ‘right of silence’ – stay not granted. |
| Federal Magistrates Court Act 1999, ss.15, 85(b) Federal Magistrates Court Rules 2001, rr.1.06, 1.06(2), 10.01 Trade Practices Act 1974, ss.52, 75B |
| ASX PerpetualRegistrars Ltd v Golubovic [2003] NSWSC 1157 Bannister v Director General from the Department of CorrectiveServices [2005] 1 Qd R 117 Black & White Cab Co Pty Ltd v Kelk [1984] Qd R 484 Caesar v Sommer [1980] 2 NSWLR 929 Cameron’s Unit Security Pty Ltd v Whelpton & Associates Pty Ltd (1984) 59 ALR 754 Director of Public Prosecutions for Western Australia vMansfield [2006] WASC 72 Elliot v Australian Prudential Regulation Authority [2004] FCA 586 Gallaher v Collins [2006] VSC 139 Golden City Car & Truck Centre Pty Ltd and Wall v Deputy Commissioner of Taxation (1999) 42 ATR 379 Griffin v P&O Finance& Property Facilitators Pty Ltd [2005] SADC 162 Griffin v Sogelease Australia Ltd [2002] NSWCA 421 Hennesy v Keetleys Tours Pty Ltd (1988) 30 AILR 125 Jefferson Ltd v Bhetcha [1979] 2 All ER 898 McMahon vGould (1982) 7 ACLR 202 Niven v SS [2006] NSWCA 338 Philippine Airlines v Goldair (Aust) Pty Ltd [1990] VR 385 R v British BroadcastingCorporation: Ex Parte Lavelle [1983] 1 WLR 23 Rural Export and Trading(WA) Pty Ltd v Hahnheuser [2004] FCA 1053 Sage v ASIC [2005] FCA 1043 Weston v Beaufils (1993) 43 FCR 292 WestsubDiscounts Pty Ltd v IDAPS Australia Ltd (2) (1990) 94 ALR 310 Yuill v Spedley Securities Ltd (in liq) (1992) 8 ACSR 272 at 274 Wall v Deputy Commissioner of Taxation (1999) 42 ATR 379 |
de Jersey, P. “The Inherent Jurisdiction of the Supreme Court” (1985) Queensland Law Society Journal 325
Jacob, I.H., “The Inherent Jurisdiction of the Court” (1970) 23 Current Legal Problems 23
Mason, K., “The Inherent Jurisdiction of the Supreme Court” (1983) 57 Australian Law Journal 449
| Applicant: | PROTEL COMMUNICATIONS INTERNATIONAL PTY LTD |
| First Respondent: | YOUFA CHEN |
| Second Respondent: | NEWTECH AUSTRALIA PTY LTD (ACN 115 939 501) |
| File number: | MLG 314 of 2007 |
| Applicant: | SAISE PTY LTD |
| First Respondent: | YOUFA CHEN |
| Second Respondent: | NEWTECH AUSTRALIA PTY LTD (ACN 115 939 501) |
| File number: | MLG 315 of 2007 |
| Judgment of: | FM Riethmuller |
| Hearing date: | 31 May 2007 |
| Date of Last Submission: | 4 July 2007 |
| Delivered at: | Melbourne |
| Delivered on: | 17 July 2007 |
REPRESENTATION
| Counsel for the Applicant: | Mr Harrison |
| Solicitors for the Applicant: | Efron & Associates |
| Counsel for the Respondent: | Mr Cleary |
| Solicitors for the Respondent: | Pryor Tzannes & Wallis |
ORDERS
That the application for a stay be refused.
That the respondent YOUFA CHEN pay the applicant’s costs of the stay application in a sum to be agreed and failing agreement as assessed.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT MELBOURNE |
MLG 314 OF 2007 & MLG 315 OF 2007
| PROTEL COMMUNICATIONS INTERNATIONAL PTY LTD |
Applicant
And
| YOUFA CHEN |
First Respondent
| NEWTECH AUSTRALIA PTY LTD (ACN 115 939 501) |
Second Respondent
| SAISE PTY LTD |
Applicant
And
| YOUFA CHEN |
First Respondent
| NEWTECH AUSTRALIA PTY LTD (ACN 115 939 501) |
Second Respondent
REASONS FOR JUDGMENT
The first respondent seeks orders vacating directions made on 19 April 2007 requiring the parties to undertake discovery and listing the matter for hearing 11 October 2004, together with an order that the proceedings be stayed pending the determination of criminal proceedings presently pending against the first respondent in the District Court of Queensland.
Background
The claim by the applicant is for damages against the first and second respondents on the basis of claims that they had engaged in misleading and deceptive conduct, the result of which is a debt payable by the second respondent to the applicants for over $600,000 for the supply of telephonic services. It is alleged that the first respondent was the person who made representations on behalf of the second respondent in an application form for an ISDN line that:
a)the second respondent would use $3000-$4000 per month of call services;
b)maintain a standing credit card authorisation for payment; and
c)that the payment would be effected each month.
It is alleged that rather than using the $3000-$4000 of services in the first month the second respondent used over $400,000 and $200,000 worth of calls (with respect to each of the applicants). It is also alleged that a standing authorisation for credit card payment was not maintained in that the credit card details provided on the application form related to a credit card that had expired. The accounts were not paid, and it appears that the second respondent has no capacity to pay the accounts. The action relies upon ss.52 and 75b of Trade Practices Act 1974, and the Victorian and Queensland Fair Trading Legislation.
In the defence filed on 27 March 2007 the first respondent makes direct denial of the allegations with respect to statements by him personally. He says that he does not know and cannot admit the balance of the allegations that are set out in the statement of claim. The defence contains no allegations of fact nor any admissions whatsoever.
In support of the application for the stay the first respondent relies upon an affidavit of his solicitor Mr Maconachie. The affidavit attaches a copy of the inditement that has been presented in the District Court of Queensland wherein the first respondent is charged with fraud with respect to what appears to be the same transactions that are the basis of the claims in these proceedings.
The criminal proceedings are set down for a 3 week trial commencing 3 December 2007 in Brisbane. Subsequent to hearing the initial argument on this application, further evidence about the likely date of the trial was led on a Mareva injunction application showing that it is likely that the trial will be held in early to mid 2008.
The affidavit of Mr Maconachie goes on to state the following:
[11] I believe the applicant in these proceedings is a wholly owned subsidiary of Access.
[12] The potential witnesses for the applicant in these proceedings are potential Crown witnesses in the criminal proceedings. Annexed to this affidavit and marked with letter “E” is a true copy of the witness statement of Alexander Kontouris in the criminal proceedings. Annexed to this affidavit and marked with the letter “F” is the witness statement of Julianne Gorrie in the criminal proceedings. Annexed to this affidavit and marked “G” of this affidavit is a true copy of the witness statement in the criminal proceedings. Annexed to this affidavit is a true copy of the witness statement of Martin Challenor in the criminal proceedings.
[13] On 17 May 2006 an article appeared on the website entitled “Man bailed over $1.2m phone fraud”. That article names the first defendant as the man referred to. Annexed to this affidavit and marked with the letter “H” is a true copy of that article.
[14] I am informed, and verily believe that the first respondent owns two properties. One in his own name in Pinjarra Hills, Queensland, the other as joint tenant with his wife in Fortitude Valley, Queensland. Annexed to this affidavit and marked with the letter “I” is a true copy of the title search in respect of the Pinjarra Hills Property.
[15] I believe that should these proceedings proceed prior to the determination of the criminal proceedings the first respondent’s ability to defend himself in the criminal proceedings will be prejudiced.
Power to grant a stay
The applicant argued that the Federal Magistrates Court does not have power to stay its own proceedings. Whilst superior courts of record, in the style of the High Court of England, have significant inherent jurisdiction, all courts have some degree of inherent powers over their own process. The extent of that jurisdiction has been the focus of many eminent jurists: see for example Jacob, I.H., “The Inherent Jurisdiction of the Court” (1970) 23 Current Legal Problems 23; Mason, K., “The Inherent Jurisdiction of the Supreme Court” (1983) 57 Australian Law Journal 449; and de Jersey, P. “The Inherent Jurisdiction of the Supreme Court” (1985) Queensland Law Society Journal 325.
I am satisfied that the court has an inherent power to control its own process which is sufficiently wide to include stay of proceedings pending the outcome of criminal proceedings.
In any event s.15 of the Federal Magistrates Act 1999 provides the court with power to make orders of such kinds as the court thinks appropriate. The corresponding provisions of the Federal Court of Australia Act 1975 are of sufficient breadth to allow for an order for a stay for want of prosecution (see Hennesy v Keetleys Tours Pty Ltd (1988) 30 AILR 125), and to prevent misuse of the court procedures (see WestsubDiscounts Pty Ltd v IDAPS Australia Ltd (2) (1990) 94 ALR 310). There is no reason why the provision in the Federal Magistrates Court Act would not confer the same powers. Indeed the power to stay proceedings is specifically contemplated by the legislature in the form of the rule making power in s.85(b) of the Federal Magistrates Court Act.
The respondent argues that while s.85(b) of the Federal Magistrates Court Act makes provision for the court to make rules with respect to stays no such specific rules have yet been made. Thus, it is argued, the court is therefore not able to exercise the power. This argument is misconceived. The jurisdiction and powers of the court are to be found elsewhere in the Federal Magistrates Court Act or other legislation conferring jurisdiction. If the rule making power could be utilised by the court to confer jurisdiction or powers, the court could confer upon itself jurisdiction and power limited only by the broad provisions of Ch III of the Constitution. To state the effect of such an argument is enough to show it cannot be sound. The opposite extreme of the argument is that the lack of rules impede the court’s exercise of its jurisdiction and powers. This would be similarly absurd, in that a court could decline to exercise its jurisdiction or powers conferred by parliament, simply because a majority of the members of the court declined to make rules.
The promulgation of rules of a court by its members does not create jurisdiction or powers in the court. The rules simply provide a standard scheme of procedure for the orderly business of the court, subject always to the discretion of individual judicial officers making specific procedural orders in particular cases. This is why the rules always contain provisions allowing the court to dispense with the rules (see r.1.06), and general provisions for directions to be made in particular cases (see rr.10.01 and 1.06(2)).
I am therefore satisfied that there is power to stay the proceedings as requested, if it is appropriate to do so.
Relevant considerations
The matters relevant to the exercise of the discretion on an application to stay civil proceedings pending the outcome of criminal proceedings were set out by Wooten J in McMahon vGould (1982) 7 ACLR 202 as follows:
I approach the decision of this matter with the following guidelines:
(a) Prime facie a plaintiff is entitled to have his action tried in the ordinary course of the procedure and business of the court;
(b) It is a grave matter to interfere with this entitlement by a stay of proceedings, which requires justification on proper grounds;
(c) The burden is on the defendant in a civil action to show that it is just and convenient that the plaintiff’s ordinary rights should be interfered with;
(d) Neither an accused nor the Crown are entitled as of right to have a civil proceeding stayed because of a pending or possible criminal proceeding;
(e) The court’s task is one of ‘the balancing of justice between the parties’, taking account of all relevant factors;
(f) Each case must be judged on its own merits, and it would be wrong and undesirable to attempt to define in the abstract what are the relevant factors;
(g) One factor to take into account where there are pending or possible criminal proceedings is what is sometimes referred to as the accused’s ‘right of silence’, and the reasons why that right, under the law as it stands, is a right of a defendant in a criminal proceeding. I return to this subject below;
(h) However, the so-called ‘right of silence’ does not extend to give such a defendant as a matter of right the same protection in contemporaneous civil proceedings. The plaintiff in a civil action is not debarred from pursing action in accordance with the normal rules merely because to do so would, or might, result in the defendant, if he wished to defend the action, having to disclose, in resisting an application for summary judgment, in the pleading of his defence, or by way of discovery or otherwise, what his defence is likely to be in the criminal proceeding;
(i) The court should consider whether there is a real and not merely notional danger of injustice in the criminal proceedings;
(j) In this regard factors which may be relevant include:
(i) the possibility of publicity that might reach and influence jurors in the civil proceedings;
(ii) the proximity of the criminal hearing;
(iii) the possibility of miscarriage of justice eg by disclosure of a defence enabling the fabrication of evidence by prosecution witnesses, or interference with defence witnesses;
(iv) the burden on the defendant of preparing for both sets of proceedings concurrently;
(v) whether the defendant has already disclosed his defence to the allegations;
(vi) the conduct of the defendant, including his own prior invocation of civil process when it suited him;
(k) The effect on the plaintiff must also be considered and weighed against the effect on the defendant. In this connection I suggest below that it may be relevant to consider the nature of the defendant’s obligation to the plaintiff;
(l) In an appropriate case the proceedings may be allowed to proceed to a certain stage, eg, setting down for trial, and the stayed." (citations omitted)
As counsel pointed out, these principles have been applied in the various courts throughout Australia: see Cameron’s Unit Security Pty Ltd v Whelpton & Associates Pty Ltd (1984) 59 ALR 754 at 757-758 (per Wilcox J); Weston v Beaufils (1993) 43 FCR 292 at 295-295 per Burchett J); Rural Export and Trading(WA) Pty Ltd v Hahnheuser [2004] FCA 1053 at [5] (per Gray J); Sage v ASIC [2005] FCA 1043 at [21] (per Goldberg J); Philippine Airlines v Goldair (Aust) Pty Ltd [1990] VR 385 at 387-388 (per Young CJ); Gallaher v Collins [2006] VSC 139 at [27] (per Hargrave J). Griffin v Sogelease Australia Ltd [2002] NSWCA 421 at [10] (per Sheller and Ipp JJA, Davies AJA); ASX PerpetualRegistrars Ltd v Golubovic [2003] NSWSC 1157 at [2] (per Hamilton J). Bannister v Director General from the Department of CorrectiveServices [2005] 1 Qd R 117 at [10] (per Holmes J). Griffin v P&O Finance& Property Facilitators Pty Ltd [2005] SADC 162 at [14] (per Judge Smith). Director of Public Prosecutions for Western Australia vMansfield [2006] WASC 72 at [20] (per Blaxell J). Whilst it appears that this issue has not yet been the subject of a published judgment in the Federal Magistrates Court, it is apparent that the principles would apply to proceedings before the Federal Magistrates Court, just as they do in the other courts.
In Gallaher v Collins & Ors [2006] VSC 139 Hargrave J said that the applicant for a stay must show ‘a real, and not merely notional, risk of prejudice to him in the criminal proceedings’. In that case a stay was not granted, although the trial of the civil claim would have been likely to follow the trial of the criminal charges in the ordinary course of listing in the courts: see [37].
In Yuill v Spedley Securities Ltd (in liq) (1992) 8 ACSR 272 at 274, Kirby P said:
One day it may be appropriate for this Court to reconsider the guidelines stated by Wootton J in McMahon v Gould. There are, in my view, considerations additional to those which are referred to by Wootton J which it would be relevant to consider in proceeding to determine an application for a stay ... For example, it is my opinion relevant to take specifically into account the public’s own interest in the normal primacy of the administration of criminal justice, being a part of the public law of the community relevant to its good order and peaceful government. This consideration might help explain why, ordinarily but not universally, such proceedings should be heard and determined first.
The other members of the court in Yuill did not agree with Kirby P on this point, however I note the careful reading that must be given to the first of the factors identified by Wooten J in McMahon, as explained by Priestly JA at 275. Subsequently, in Niven v SS [2006] NSWCA 338 the court declined to revisit McMahon.
In Bannister & Ors v D-G Department of Corrective Services [2002] QSC 469 Holmes J said:
[10] There is a substantial body of authority dealing with applications for stay of civil proceedings pending determination of criminal charges. Generally speaking, courts have been disinclined to preclude any plaintiff from having his action tried by reason of criminal charges pending against the defendant, but there is, of course, a balancing exercise involved …
In Golden City Car & Truck Centre Pty Ltd and Wall v Deputy Commissioner of Taxation (1999) 42 ATR 379 Cooper J was not persuaded that there was a real risk of prejudice, after analysing the nature of the actual claims in the proceedings.
In Elliot v Australian Prudential Regulation Authority [2004] FCA 586 at [21] to [23] and Rural Export and Trading (WA) Pty Ltd v Hahnheuser [2004] FCA 1053 at [7] Gray J referred to the importance of placing material before the court to show the prejudice alleged.
Counsel for the first respondent developed the argument on the basis that there were 4 significant factors relevant to the exercise of the discretion in this case:
a)That there was potential of adverse publicity.
b)The proximity of the criminal proceedings to the civil proceedings which would arguably result in the preparation for one would interfering with preparation for the other.
c)That there is a potential for a miscarriage of justice as a result of the potential for witnesses to change their version of events or improve their identification evidence following cross-examination in the civil proceedings.
d)That the first respondent may lose the forensic disadvantage of his right of silence (in this case, not having to disclose his defence to the criminal proceedings if he must defend the civil proceedings prior to the close of the crown case in the criminal proceedings). This argument was developed to include an argument that his defence of the civil proceedings may also lead to a chain of enquiry by the Director of Prosecutions which may result in the Director of Prosecutions obtaining further evidence against him.
Adverse publicity
The first respondent relied upon the newspaper article reporting that the first respondent had been charged, and a letter from a debt collector indicating that the media had taken some interest and that the debt collector had not responded as yet.
The publicity to date has been minimal. The civil proceedings are in a lower level court in a different state. The elements of the criminal charge do differ from the claims in these proceedings, and the onus of proof is very different. Modern juries are well acquainted with the idea that there can be significant civil liability without criminal conduct. I am not satisfied that the risk of injustice as a result of adverse publicity is more than a minor risk, if it poses any risk at all.
Impact on preparation
Since the initial argument it has become clear that the criminal proceedings are unlikely to be heard until 2008. I also note that the civil proceedings are listed for two days and the criminal proceedings are now expected to take 5 weeks. Whilst the criminal proceedings are listed in Queensland the first respondent has engaged solicitors with respect to both proceedings who are in Sydney.
The first respondent has chosen a law firm in Sydney to represent him, and engaged a senior and junior counsel in Brisbane at not inconsiderable expense. The time between the two trials will now be many months. I am not persuaded on the material provided that there is any risk of injustice to the applicant as a result of the proximity of the two hearings. Even if the time between the two trials was as originally stated, the first respondent is unemployed (aside from some share trading) and has many weeks to prepare his cases.
Impact on witnesses
The extent of the committal proceedings has not been disclosed in the affidavits. I have no evidence as to whether or not the witnesses have already been cross-examined in a committal hearing in Queensland before the proceedings reached the stage of the prosecution presenting an indictment. It would be unusual for the defendant in a serious criminal case that is being strongly defended to not cross-examine the witnesses of the prosecution at some length in a committal proceeding.
It does not seem to me that there is any real risk of miscarriage of justice as a result of the conduct of the civil trial, at least to the extent that witnesses may change their evidence as a result of cross-examination or the outcome of the civil proceedings. A transcript will be available of the evidence that the witnesses give in the civil trial. Indeed, it may well be to the respondent’s advantage to have a further version of events of some witnesses in the civil proceedings from which they may be cross-examined in the criminal proceedings. To the extent that such cross-examination may disclose the first respondent’s defence, this is considered below.
Right of silence
The fourth matter raised is the disclosure of the first respondent’s defence.
I note that in Bannister & Ors v D-G Department of Corrective Services [2002] QSC 469 Holmes J said:
[11] On the McMahon v Gould guidelines, it does not seem that the loss of the right to silence could of itself warrant intervention …
In McMahon v Gould, Wooten J analysed the right of silence, identifying the reasons of such a ‘right’ in Anglo Australian law:
Unfair pressure on a suspect in custody; the discouragement of improper police methods; the inducement of unreliable evidence; the absence of satisfactory methods of recording statements; the lack of time for reflection or of opportunity to take legal advice; the abhorrence of forcing a man to convict himself ... the maintenance of dignity and humanity in criminal trials ... because of the possibility that an innocent man forced into the box may give an impression of guilt through being stupid, slow, overawed or simply nervous, he should have the choice of whether he gives evidence or not, without the risk of adverse comment.
Wooten J, however, did not see the right as being present for reasons such as:
… the opportunity it may give the accused to remain silent til the end of the evidence against him at the trial, and then produce a fabricated story perfectly tailored to meet that evidence. They include the possibility of depriving the prosecution of any opportunity to check the accused’s story and obtain evidence to refute it before the trial is over.
It is not suggested that reasons of the latter type are relied upon by the first respondent in this case, however the comments help to identify the real reasons for the right of silence as distinct from some of the undesirable practical consequences of the exercise of that ‘right’.
In Jefferson Ltd v Bhetcha [1979] 2 All ER 898 at 904 Megaw LJ said of the ‘right of silence’:
... I should be prepared to accept that the court which is competent to control the proceedings in the civil action, whether it be a master, a judge, or this court, would have a discretion, under section 41 of the Supreme Court of Judicature (Consolidation) Act 1925, to stay the proceedings, if it appeared to the court that justice – the balancing of justice between the parties – so required, having regard to the concurrent criminal proceedings, and taking into account the principle, which applies in the criminal proceeding itself, of what is sometimes referred to as the “right of silence” and the reason why that right, under the law as it stands, is a right of a defendant in criminal proceedings. But in the civil court it would be a matter of discretion, and not of right. There is, I say again, in my judgment, no principle of law that a plaintiff in a civil action is to be disbarred from pursuing that action in accordance with the normal rules for the conduct of civil actions merely because so to do would, or might, result in the defendant, if he wished to defend the action, having to disclose, by an affidavit under Order 14, or in the pleading of his defence, or by way of discovery or otherwise, what his defence is or may be, in whole or in part, with the result that he might be giving an indication of what his defence was likely to be in the contemporaneous criminal proceedings. The protection which is at present given to one facing a criminal charge – the so called “right of silence” – does not extend to give the defendant as a matter of right the same protection in contemporaneous civil proceedings.
These comments were found to be persuasive by Connolly J in Black & White Cab Co Pty Ltd v Kelk [1984] Qd R 484. In that case his Honour also provided an interesting historical perspective, suggesting that the old form of ‘rule in relation to felonious torts probably had its origin in the right of the Crown to forfeiture of the property of the felon and in its inception was designed to protect the interests of the Crown.’ His Honour said that the rule was later explained as a reflection of public policy against the compromise of serious crimes. It is only in modern times that the rule has principle has developed to protect an accused from prejudice.
In R v British Broadcasting*Corporation: Ex Parte Lavelle [1983] 1 WLR 23 at 39 Wolf LJ referred to the need to show ‘a real danger not merely a notional danger’.
Similarly Roden J, in Caesar v Sommer [1980] 2 NSWLR 929 at 932 (para 11) considered that the fact that a defendant may make statements they would not be required to make did not mean that the defendant would be necessarily prejudiced such as to call for intervention that would deprive the plaintiff of his right to access to the courts in the usual manner. Roden J went on to comment that no evidence had been led in that case to suggest actual prejudice in that case.
In Cameron's Unit Services Pty Limited v Whelpton & Associates Pty Limited (1984) 59 ALR 754 Wilcox J considered a case with a similar factual basis. A director of a company had been charged with fraud arising out of the same events that were the subject of the civil proceedings. Wilcox J said, at 760:
The `right of silence' is a right which a person has in relation to present or anticipated criminal proceedings. As a matter of everyday experience, suspects or accused persons waive the right by giving an explanation of their conduct during the course of interrogation by police or other investigating authorities or in evidence at their trial. No doubt the right is often waived incautiously or through ignorance, but is also deliberately waived by informed persons who take the view that waiver will best serve their interests overall. The conflicts of interest which give rise to waiver already exist; the law does not step in to prevent those conflicts or to deny the ability to waive the right. The existence of a civil action which an accused person may wish to defend provides simply another example of a conflict of interest between maintaining silence and disclosing the substance of the defence in the criminal proceedings. I see no basis for the view that the court should intervene to relieve against this particular conflict, when it does not relieve against others. The fact that the existence of the civil action may result in a decision by the accused person to waive his right of silence is not, in itself, a sufficient reason to stay that action. The real question must be the likelihood of causing injustice in the criminal proceedings...
The argument was developed in two separate strands by counsel for the first respondent. Firstly, that there would be a potential loss of forensic advantage in the prosecution being unaware of the defence until after the close of the prosecution case. This could affect the first respondent through the potential loss of forensic advantage by the first respondent having to give evidence and be cross examined in the civil proceedings, and therefore there would be a transcript of his evidence available to the prosecution in the criminal trial. It could also affect him by losing the forensic advantage of not disclose the thrust of his defence prior to the close of the prosecution case. Of course, such forensic losses are inevitable on every occasion that there is a re-trial and in all proceedings of a criminal nature where there have been some earlier civil proceedings. The way that this may impact upon the first respondent in this case is entirely speculative, in that the depositions and prosecution witness statements have not been put in evidence before me, nor any evidence as to whether the first respondent has participated in a record of interview with police, or otherwise provided any information. On the evidence before me I am not satisfied that this is a significant matter in this case.
The second strand of the argument related to the possibility of that:
a)the material discovered in the civil proceedings; and
b)the evidence given
may lead to a chain of enquiry by the prosecution to further improve it’s case against the respondent.
No evidence was given as to the extent of material that the prosecution has amassed to date. No evidence was given as to whether or not there was material with respect to which a claim for privilege may be made or even that there are documents beyond those disclosed by the prosecution in the committal proceedings. It appears to me that the chain of enquiry argument, on the limited material in the affidavits before me on this application, is speculative.
I therefore turn to consider each of the matters identified by Justice Wooten in McMahon v Gould (supra).
Items (a) to (f)
Prima facie the plaintiff in this case is entitled to have the proceedings tried in the ordinary course of business of the court. Whilst in years gone by that may have meant a delay of two to three years that is no longer the norm in the Federal Magistrates Court. It has become well recognised that delays in commercial proceedings in the courts are a significant economic impediment for the parties. In commercial proceedings the Federal Magistrates Court endeavours to provide a hearing within six months if the parties can prepare in such a time frame. Indeed, even in much more complex cases in the Federal Court trials are underway with a ‘Rocket Docket’ to provide a similarly timely response in commercial matters. It is a significant and important aspect of effective access to justice by commercial people that the court provides an early hearing date with minimal procedural expense.
However, it is difficult to put any price upon justice in the criminal law. Desirable economic outcomes, of themselves, do not over-ride a person’s rights.
The onus is on the first respondent, and the deficiencies in his material are referred to above.
Most importantly, no previous authority is identical, and this case must be judged on its own facts and circumstances having regard to the difficult and intricate balances that must be struck.
Items (g) to (j)
The nature of the right of silence is discussed above. I take into account the nature of the right and its purposes. The requirement to consider the extent of the possible injustice is important. With respect to the wording of item (i) of Wooten J’s list I prefer to approach the matter on the basis of determining if there is more than a notional or speculative risk, and then weighing that risk with the other factors.
I have considered the risk of publicity above. I have also had regard to the proximity of the two hearings and the potential burden of preparing both trials concurrently. Even if the criminal trial is not moved to 2008 there does not appear to me to be any risk of injustice in the circumstances before me as a result of the proximity of the proceedings.
The possibility of witnesses fabricating evidence, or witnesses being interfered with, is entirely speculative on the material before me. There is no evidence of the witnesses the prosecution relies upon. There is no evidence as to whether they have been cross-examined at the committal proceedings. There is nothing about their evidence that has been identified that may found such a concern.
The defendant has already pleaded to the statement of claim in these proceedings. No positive defence or positive allegation of fact is contained therein. No evidence has been given as to what, if anything, he has disclosed to the prosecution to date (for example, in a record of interview). Any potential prejudice as a result of a potential loss of his right of silence is also speculation.
The first respondent has not brought proceeding or taken any steps that can be argued are inconsistent with the stay being sought.
Item (k)
The effect on the applicant of a stay may be significant. The delay is likely to be for a period of 6 months to 12 months before a trial could be held. It is real possibility that if the civil proceedings are stayed the applicant may be left with a judgement in circumstances where there are insufficient assets to enforce against. This is a real risk in many civil actions. In this case the risk is lessened as there are now Mareva injunctions in place. However, they provide for the first respondent to draw over $5,000 per week for living expenses and legal expenses, with respect to assets insufficient to meet the totality of the two civil claims in the Federal Magistrates Court (if the applicants succeed).
The first respondent argues that a factor in favour of a stay is that his assets are needed for his criminal defence, and would be completely consumed if the current proceedings are successful. He says that he should be able to apply all of his assets to his defence. If this were a basis for resisting a civil claim, then even unrelated civil claims could be stayed pending the outcome of criminal proceedings. I do not accept that this, of itself, can be a proper basis for a stay.
There is nothing to suggest that the applicants’ are not companies of means, such that there is any risk of a costs order going unsatisfied, if the applicants’ are unsuccessful in the proceedings and ordered to pay the first respondent’s costs. Whilst his costs with his own solicitor may be greater than the scale fees, prudent expenditure on legal fees in this matter would be unlikely to significantly diminish his resources for defending the criminal proceedings.
Item (l)
I take into account that it is within the discretion open to me in this case to allow the case to proceed as far as I find reasonable through interlocutory steps before granting a stay: that is, it is not a situation where there must either be a stay of everything, or nothing.
Conclusion
Having regard to all of the circumstances of this case I am not satisfied that the first respondent has shown that it is appropriate to grant a stay of the proceedings on the material currently before me.
I therefore dismiss the application.
I certify that the preceding fifty-seven (57) paragraphs are a true copy of the reasons for judgment of Riethmuller FM
Deputy Associate: Averil Tan
Date: 17 July 2007
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