VONBROCKHUSEN-BURKE v Lysevych (Civil Dispute)
[2022] ACAT 94
•27 September 2022
ACT CIVIL & ADMINISTRATIVE TRIBUNAL
VONBROCKHUSEN-BURKE v LYSEVYCH (Civil Dispute) [2022] ACAT 94
XD 515/2022
Catchwords: CIVIL DISPUTE – application to set aside consent orders – consent orders made at conference – inadmissibility of statements made at conference – procedural fairness requirement for conference – failure to comply with procedural requirements – extraordinary circumstances – interests of justice to set aside orders
Legislation cited: ACT Civil and Administrative Tribunal Act 2008 s 34, 56
Court Procedures Act 2004 s 52B
Evidence Act 2011 s 131
Subordinate
Legislation cited: ACT Civil and Administrative Tribunal Procedures Rules 2020 rules 70, 112
Cases cited:Kioa v West (1985) 159 CLR 550
Re Minister for Immigration and Multicultural Affairs; Ex parte Lam (2003) 214 CLR 1
The Legal Practitioner v Council of the Law Society of the ACT [2016] ACTCA 35
Tribunal: Presidential Member M-T Daniel
Date of Orders: 27 September 2022
Date of Reasons for Decision: 11 November 2022
AUSTRALIAN CAPITAL TERRITORY )
CIVIL & ADMINISTRATIVE TRIBUNAL ) XD 515/2022
BETWEEN:
FABION JAMES VONBROCKHUSEN-BURKE
Applicant
AND:
MYKHALO VENIAMNOVYCH LYSEVYCH
Respondent
TRIBUNAL:Presidential Member M-T Daniel
DATE:27 September 2022
ORDER
The Tribunal orders that:
The orders of 16 September 2022 are set aside and the application and
counter-claim are restored.
The application is listed for hearing on Wednesday 9 November 2022 at 10:00am.
………………………………..
Presidential Member M-T Daniel
REASONS FOR DECISION
Introduction
On 27 September 2022, at the applicant’s request, I set aside orders of the tribunal made by consent of the parties on 16 September 2022. My reasons follow.
The conduct of the proceedings leading to the 16 September 2022 orders
In the past, the applicant and the respondent were involved in a minor motor vehicle collision.
The applicant lodged a civil dispute application against the respondent, expressed to be a damages and trespass application. He sought payment of $2,144.25 (subject to obtaining an updated repair quote) and reimbursement of the filing fee of $78.
The respondent was served with the application, and on 13 July 2022 lodged his response. In his response the respondent disputed the claim on the basis that a settlement had been reached with the respondent’s insurer; with $2,638.52 paid to the applicant and the insurer (and respondent) being released from liability.
Because of the small amount sought, and the straightforward nature of the claim and response, the application was listed for a Conference and Immediate Determination (CID) to take place on 16 September 2022. A CID is a tribunal process whereby the parties participate in a conference to identify the real issues in dispute and try to reach an agreement about how to resolve the dispute. If no agreement is reached, the application proceeds to a hearing and determination later that day.
To facilitate the CID, directions were made for the applicant and respondent to give to the tribunal and each other, by 10 August 2022 and 31 August 2022 respectively, the witness statements and other documents they would rely upon if the matter proceeded to hearing on 16 September. The parties were also directed to have their witnesses available on that day.
On 25 July 2022 the respondent lodged an amended response. In the amended response he counter-claimed for an amount of $1,200 to cover “the time invested by the respondent into this vexatious claim.” The response also adverted to allegedly defamatory or threatening emails and text messages said to have been sent by the applicant to the respondent and his workplace, but did not expressly seek damages on this basis.
The respondent paid the filing fee for the counter-claim on 5 September 2022, and on 6 September 2022 the respondent applied to the tribunal for orders that the tribunal serve the amended response and his evidence upon the applicant directly. This application was refused on 9 September 2022 and the respondent was told he had to himself give those documents to the applicant.
The applicant says that he received an unsealed copy of the amended response by email sent at 3:45pm on Thursday, 15 September 2022, the day before the CID.
Both parties attended the tribunal in person on 16 September 2022 and participated in the conference before a Senior Member of the tribunal. The Senior Member made an order as follows:
1. The application is dismissed.
The Tribunal notes:
By agreement:
(a) The applicant is to apologise in writing within 7 days to the respondent unreservedly for the allegations made in communications with the respondents employer and colleagues.
(b) The applicant undertakes to pay the sum of $2,638.52 by fortnightly instalments of $500 starting on 30 September 2022.
(c) If the applicant complies with notes (a) and (b), the respondent releases the applicant from any liability for any defamatory conduct.
Although it was not clear on the face of the orders, the applicant’s description of the process and the fact the orders were made by the Senior Member who conducted the conference[1] indicate that the order was made by consent of both parties.
The set aside application
[1] When an application listed for CID is not resolved at the conference by agreement, it is heard later in the day by a different member of the tribunal.
On 21 September 2022 the applicant, now represented by a solicitor, lodged an interim orders application (the set aside application) asking the Tribunal to:
(a)set aside the orders of 21 September 2022;
(b)declare that the applicant did not give a binding undertaking or make a binding agreement with the respondent during the conference; and
(c)list the matter for hearing.
The set aside application was listed before me for hearing on 27 September 2022.
The Tribunal’s power to set aside final orders
Section 56(c) of the ACT Civil and Administrative Tribunal Act 2008 (ACAT Act) gives the tribunal the power to set aside final orders, in specified circumstances. Section 56(c) provides:
The tribunal may, by order—
…
(c) amend or set aside a tribunal order if—
(i)the order was made after hearing an application in the absence of a party; or
Note A party may apply to the tribunal under this provision if the tribunal makes an order under s 47A after hearing an application in the absence of a party.
(ii)the order is in error in relation to an amount or the name or address of a party, and the tribunal proposes to amend or set aside the order only to correct the error; or
(iii)extraordinary circumstances make it appropriate to amend or set aside the order; or
…
It was paragraph 56(c)(iii) that was relied upon in this case.
Rule 70 of the ACT Civil and Administrative Tribunal Procedures Rules 2020 (the Rules), which applies to setting aside final orders made by consent, provides guidance for the exercise of the power provided by section 56(c).[2] Rule 70(3) specifies that: “The tribunal may set aside a final order only if it is in the interests of justice to do so.” Rule 70(6) then provides:
[2] The content of rule 70 reflects the jurisprudence that has developed in Courts and Tribunals in relation to setting aside final orders.
(6) In considering whether to set aside a final order made by consent, the tribunal may take into account the following:
(a)whether the consent was obtained by fraud, duress, suppression of relevant information or evidence or reliance on false evidence or information;
(b)whether any other party was responsible for the fraud, duress, suppression of relevant information or evidence or false evidence or information;
(c)any prejudice to any other party;
(d)any other issue the tribunal considers relevant.
The parties’ submissions
Annexed to the set-aside application was an 11-page submission from the applicant’s solicitor setting out the applicant’s argument that it was in the interests of justice to set aside the consent orders. In summary, the applicant submitted:
(a)the applicant was not served with a sealed copy of the counter-claim as required by rule 112;
(b)the tribunal had not by order granted the respondent leave to lodge a counter-claim as contemplated by rule 112(2)(d);
(c)due to late service of the amended response, he had been denied procedural fairness in relation to the counter-claim which was considered at the conference;
(d)during the conference the respondent showed the Senior Member the alleged defamatory emails, but these documents were not shown to the applicant;
(e)during the conference the Senior Member said words about the prospects of success and quantum of the various claims that, given that the applicant was self-represented and unemployed, constituted ‘an element of duress’ and which made the applicant feel pressured to withdraw his application and reach an agreement about the potential defamation claim; and
(f)the agreement between the applicant and respondent – such as it was – was not correctly recorded by the notation to the consent orders. The applicant says he was not shown a draft of the proposed orders in advance of the orders being made. The applicant denies that he undertook to apologise unreservedly and says that the agreement was optional in the sense that the applicant, if he chose to do so after further consideration, could make payments in satisfaction of the potential defamation claim.
The factual assertions falling within the last two submissions, which were extensive, were said to be “on instructions”. The applicant’s solicitor had not been present at the conference. There was no witness statement from the applicant in support of the set-aside application.
The applicant was represented by his solicitor at the hearing on 27 September 2022. I did not require further oral submissions on behalf of the applicant at that hearing, nor did I require the applicant to give evidence.[3]
[3] This restraint was largely due to the risk of the applicant – or later the respondent – inadvertently disclosing to me words that had been said at the conference.
The respondent represented himself at the hearing on 27 September 2022. He agreed that during the conference he had shown some email correspondence to the Senior Member. He said he thought the applicant would be familiar with those documents because they emanated from an email address the respondent knew the applicant to use. The respondent conceded those emails had not been shown to the applicant during the conference. I declined to view the emails.
The respondent did not oppose the orders of 16 September 2022 being set aside.
Consideration
Although the respondent did not oppose the set aside application, it is a serious matter to set aside a final order of tribunal, whatever its provenance. It would be contrary to the public interest in finality of litigation to accede to such a request merely on application. Therefore I proceeded to consider the circumstances (as much as they could be known) and the submissions of the applicant.
The applicant’s case can be condensed into four general arguments:
(a)The respondent’s counter-claim did not comply with the requirements of the Rules.
(b)The Tribunal had failed to accord the applicant procedural fairness in the way it came to consider the counter-claim at the conference.
(c)The way the conference was conducted by the Senior Member involved reliance upon false information, a suppression of that information from the applicant to the applicant’s disadvantage, and the Senior Member applying their authority in favour of the respondent such that the applicant’s consent was affected by an element of duress.
(d)The notation to the consent orders did not accurately reflect the oral agreement which the applicant had reached with the respondent in the conference.
It was not necessary for me to determine whether the applicant’s third and fourth arguments were made out. This was because I was satisfied that as provided by section 56(c)(iii) the circumstances were extraordinary, and it was appropriate to set aside the consent orders.
In relation to the applicant’s first argument, the counter-claim had been brought by way of an amended response, and thus outside the timeframe contemplated by rule 112 of the Rules. There is no specific form for a counter-claim, but it may be brought via Part C of the response form, and rule 112 adverts to this process.
In addition, prior to the conference a sealed copy of the counter-claim had not been served by the Registrar as required by rule 112.
The applicant pointed out that no order was made extending the time for lodging the counter-claim. Nor was an order made by the tribunal under rule 6 disapplying this time limit.
What is the legal consequence of a failure to comply with these rules?
These provisions form part of the ‘procedural requirements’ for the conduct of an application, with which the parties are bound to comply by rule 58:
58 Procedural requirements for applications
(1)A proceeding for an application must be conducted in accordance with the procedural requirements in the Act, the regulation, these rules, any practice notes and directions that apply to the application (the procedural requirements).
(2)Parties to an application must comply with the procedural requirements for the application.
Importantly, rule 59 provides that failure to comply with a procedural requirement for an application is an irregularity and does not make a proceeding, or a document lodged, step taken, or order made in the proceeding, void:
59 Failure to comply with procedural requirements
(1)Failure to comply with a procedural requirement for an application is an irregularity and does not make a proceeding, or a document lodged, step taken or order made in the proceeding, void.
(2)If there has been a failure to comply with a procedural requirement, the tribunal may make any order dealing with the proceeding or the application that it considers appropriate.
Note The Act, s 56 (d) applies.
Examples
1 If the defaulting party in an application is the applicant, the tribunal may dismiss the application, extend the time to comply with the procedural requirement that has not been complied with or give further directions.
2 If the defaulting party in an application is the respondent, the tribunal may decide the application, extend the time to comply with the procedural requirement that has not been complied with or give further directions.
(1)The tribunal may make an order under subrule (2) on application by a party or on its own initiative.
Note Rule 62 (Interim and other orders) applies to an application.
The amended response had been accepted by the Registrar and not rejected pursuant to section 10 for non-compliance with the Rules.
In legal terms, then, the counter-claim was lodged but it was non-compliant: it was before the tribunal at the time the conference was conducted and it was within the tribunal’s power and discretion to deal with it.
I turn then to the applicants second argument – a denial of procedural fairness. The tribunal is required to perform its functions in a procedurally fair way[4], and the Rules are designed so that in most cases compliance with the Rules ensures that obligation will be met. However, there will be circumstances where the requirements of the Rules are met – but the process is procedurally unfair because of some unknown factor. Similarly, there will be cases where the requirements of the Rules are not met, and yet the proceeding can be conducted fairly.
[4] Section 7 ACAT Act
Was the tribunal procedurally fair in how it dealt with the application and the counter-claim?
The applicant submitted that the way in which the conference was conducted was procedurally unfair because of the late receipt of the counter-claim and reliance during the conference on documents with which the applicant had not been provided.
Had the tribunal been hearing the application and counter-claim, there can be little doubt that these circumstances would amount to a breach of the requirements of the ‘fair hearing rule’.[5] However, the tribunal was conducting a conference at which orders could only be made by agreement of the parties, not a hearing at which an adjudication would be imposed by the tribunal.
[5] Kioa v West (1985) 159 CLR 550
The usual triggers for application of the ‘fair hearing’ rule are not met by a conference.
Nonetheless I am satisfied that there must be at least some ‘natural justice’ in the process of a conference at which the parties reach an agreement reflected by consent orders. While the tribunal at conference is not deciding the application, nonetheless it performs an authoritative and quasi-judicial role and does not merely rubberstamp an agreed outcome. The tribunal in issuing consent orders must be satisfied that it has jurisdiction in the proceeding, that the orders agreed to are within that jurisdiction and appropriate to be made, and that it is appropriate to make any procedural orders consequent upon the parties’ agreement.[6]
[6] See section 55 ACAT Act
If a conference must be procedurally fair, what is the necessary content to avoid ‘practical injustice’ to one or more parties?[7] This will depend upon the circumstances of the case, and the parties. At the bare minimum parties should be aware of the subject matter of the conference and have adequate opportunity to participate and provide informed consent to any agreed outcomes. These considerations are even more pressing in the context of a CID in which the hearing follows almost immediately on the heels of the conference.
[7] Re Minister for Immigration and Multicultural Affairs; Ex parte Lam (2003) 214 CLR 1
On the face of it, the process adopted by the tribunal for the counter-claim did not meet these bare requirements.
That is not to say that a tribunal can never proceed to conduct a conference when a counter-claim has been served late – or not served at all. What natural justice requires will depend upon the circumstances. In some cases the tribunal may proceed with a conference with the intention of sparing the parties the time and effort of attending a conference on another day, and the parties may agree with that approach at the time.
For this conference, the question of whether procedural fairness was provided cannot be definitively resolved by the Tribunal, not least because I am constrained from taking evidence of what was said during the conference.
I was satisfied that there had been an apparent breach of procedural fairness in the tribunal dealing at conference with the counter-claim despite late provision of only an unsealed copy.
In The Legal Practitioner v Council of the Law Society of the ACT the Court of Appeal concluded that an egregious lack of procedural fairness in the making of orders could result in the orders themselves being a nullity; and could amount to ‘extraordinary circumstances’ as contemplated by section 56(c)(iii).[8] I did not consider that the apparent breach of procedural fairness in this case was so extreme that it resulted in the orders being a nullity.
[8] [2016] ACTCA 35
Nonetheless this apparent breach was one of a constellation of matters which, taken together, amounted to extraordinary circumstances. Those matters included:
(a)Non-compliance with procedural requirements of the Rules.
(b)Non-compliance with the directions to serve evidence prior to the conference.
(c)Apparent breach of procedural fairness in late notice of the counter-claim.
(d)Failure of the orders to expressly account for the counter-claim (leaving it apparently on foot and able to be pursued by the respondent).
(e)Challenge to the accuracy of the notation recording the agreement reached.
(f)Assertions of duress and impropriety in Senior Member’s conduct of conference.
(g)Inability of the tribunal to consider the evidence necessary to resolve the last three matters.
Being satisfied that there were extraordinary circumstances, the next question was whether it was appropriate to set aside the orders.
Rule 70 refers to the interests of justice as the overarching factor in deciding whether it is appropriate to set aside orders. I have earlier noted that there is a public interest in the finality of orders, and orders should not be lightly set aside. Additionally, there is a public interest in the processes of the tribunal being complied with, being seen to be complied with, and with parties having confidence that any orders issued are correct. There is an efficiency in orders being promptly set aside where they are affected by obvious error, which must also support the public interest in the administration of justice.
I did not reach any final conclusion on the matters set out in rule 70(6)(a) and (b) because, as set out below, there was little evidence I could have regard to on those matters. I took into account the applicant’s self-report that he felt pressured or under duress and the parties’ agreement that the email correspondence shown to the Senior Member had not been shown to the applicant.
In relation to prejudice to either party (rule 70(6)(c)) I considered that the parties were likely to suffer little to no prejudice from the orders being set aside and the matter being put back on track for a full hearing. If the orders were left in place, the parties would suffer the disadvantage of being bound by orders of unclear effect, and disputed accuracy, which could only be resolved by further legal proceedings in a superior court.
I was satisfied that taking all of these factors into account it was appropriate to exercise the discretion conferred by section 56(c)(iii) to set aside the orders and restore the application. I then made directions to get the matter back on track for hearing.
Inadmissibility of what was said in the conference
As to the arguments raised by the applicant about the Senior Member’s conduct during the conference and the accuracy of the notation, I was prevented from taking evidence necessary for the proper determination of those arguments by the operation of section 34(3) of the ACAT Act which provides:
34 Admissibility of evidence given at preliminary conference
(1)Evidence given by a person before the tribunal during a preliminary conference is not admissible in evidence against the person in a criminal proceeding, other than a proceeding for—
(a)an offence in relation to the falsity or misleading nature of the evidence; or
(b)an offence against the Criminal Code, chapter 7 (Administration of justice offences).
(2)Also, any information obtained, directly or indirectly, because of the giving of further information by a person in accordance with a requirement under section 33 (2), or the giving of evidence by a person before the tribunal during a preliminary conference, is not admissible in evidence against the person in a civil or criminal proceeding, other than a proceeding for—
(a)an offence in relation to the falsity or the misleading nature of the information or evidence; or
(b)an offence against the Criminal Code, chapter 7 (Administration of justice offences).
(3)Evidence of any words spoken at a preliminary conference must not be admitted in a proceeding under this Act.
This broad protection can be contrasted with the more refined approach taken to such statements in proceedings in which the Evidence Act 2011 (Evidence Act) applies. Section 131 of the Evidence Act makes settlement negotiations inadmissible but provides no less than 11 exceptions to that rule, section 131(2)(f) being the most pertinent for current purposes:
131 Exclusion of evidence of settlement negotiations
(1)Evidence must not be presented of—
(a)a communication that is made between people in dispute, or between 1 or more people in dispute and a third party, in connection with an attempt to negotiate a settlement of the dispute; or
(b)a document (whether delivered or not) that has been prepared in connection with an attempt to negotiate a settlement of a dispute.
(2)Subsection (1) does not apply if—
…
(f)the proceeding in which it is sought to present the evidence is a proceeding to enforce an agreement between the people in dispute to settle the dispute, or a proceeding in which the making of the agreement is in issue; or
…
It might be argued that the reference in section 34(3) of the ACAT Act to “a proceeding under this Act” was intended to be limited to the substantive application for which the conference is conducted, however this meaning is contrary to both the clear language used and the history of the provision. As proposed in the ACT Civil and Administrative Tribunal Bill 2008, section 34 consisted of only two lines – the second of which was the current section 34(3). During consideration of the Bill it was identified that the provision’s scope of operation was too broad, and an amendment was proposed which resulted in the current section 34. It is difficult to sustain an argument that section 34(3) is not meant to operate as broadly as it is phrased, when the legislature has already considered that issue and chosen not to interfere further with the wording.
Against this legislative history, section 34(3) must be interpreted in accordance with its apparent meaning.
This means that if parties reach an agreement about the terms of an order at a conference, and the meaning of the order or the circumstances of the parties reaching agreement becomes at issue in later tribunal proceedings, the tribunal is unable to refer to what was said in the conference to resolve the issue. Such issues could arise in proceedings as various as an application to amend or set aside a final order, proceedings to fine a party or for disciplinary action in relation to non-compliance with an order, or an application under specific legislation for variation of a final order.[9]
[9] e.g. Common Boundaries Act 1981
If similar questions about the meaning of a consent order or conduct of the conference leading to the consent order were raised in proceedings in a Court in which the Evidence Actapplies, section 131(2)(f) would permit consideration by the Court of what was said and done in the conference.
Further, if the agreement leading to consent orders had been reached at a mediation conducted under section 36 of the ACAT Act, section 52B(2) of the Court Procedures Act 2004 would apply to allow consideration of what was said at the mediation, if the parties agreed. Section 52B provides:
52B Admissibility of information given at mediation
(2) Evidence of mediation material is not admissible in a proceeding before any of the following, except in accordance with the Evidence Act 2011, section 131 (Exclusion of evidence of settlement negotiations):
(a)a court;
(b)an entity authorised to hear and receive evidence;
(c)an entity authorised by the consent of the parties to hear evidence.
(3) Evidence of mediation material is not admissible in a proceeding under the ACT Civil and Administrative Tribunal Act 2008 unless all parties agree to the giving of the evidence.
A large proportion of proceedings in the tribunal are settled by an agreement reached at conference. Historically, parties attended conferences in person and signed a handwritten record of the agreement or orders reached by consent. They might have taken a photocopy of that document with them as they left, as a record of what had been agreed pending receipt of the engrossed orders. As the tribunal increasingly conducts conferences virtually, the only record of agreement is the audio recording of the conference. Against this increasingly digital mode of operation, it would be desirable if the legislature were to consider aligning the operation of the confidentiality provisions in relation to conferences and mediations, with those contained in the Evidence Act. This would ensure participants have a clear and consistent understanding of the legal environment within which they are acting and enable the tribunal to refer to relevant contemporaneous evidence to properly resolve the occasional disputes which arise.
The request for a declaration about the agreement
The applicant had also sought a declaration that he was not bound by the agreement as set out in the notation to the orders. The basis of the tribunal’s jurisdiction to make such a declaration was not specified. In any event, without the ability to refer to what was said in the conference it would not be possible for me to be satisfied as to the terms of the agreement reached. I declined to make such a declaration.
However, I noted to the parties that when an agreement is reached between parties at a conference, in consequence of which an application is withdrawn or proceedings dismissed, it is often the withdrawal of the application or consent to the order for dismissal which forms the ‘consideration’ that would make the agreement legally binding or the ‘detrimental reliance’ which prevents the other party from not keeping their side of the bargain. In this case, the orders being set aside and application restored, it would be questionable whether any agreement reached in that conference remained binding upon the parties, and they should each take legal advice to clarify their obligations.
………………………………..
Presidential Member M-T Daniel
| Date(s) of hearing: | 27 September 2022 |
| Solicitor for Applicant: | Mr Mitchell Klievens |
| Respondent: | In Person |
0
4
5