Walker v Ruscoe

[2002] HCATrans 70

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S115 of 2001

B e t w e e n -

ELLIS RICHARD WALKER

Applicant

and

VIRGINIA JOY-ANNE RUSCOE

Respondent

Application for special leave to appeal

McHUGH J
KIRBY J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON TUESDAY, 5 MARCH 2002 AT 11.31 AM

Copyright in the High Court of Australia

MR P.L.G. BRERETON, SC:   May it please the Court, I appear with my learned friend, MR B.J. KNOX, for the applicant.  (instructed by Adrian Twigg & Co)

MR D.G. HOLMES:   May it please the Court, I appear for the respondent.  (instructed by Slade Manwaring)

McHUGH J:   Yes, Mr Brereton.

MR BRERETON:   May it please the Court, in 1986 when your Honours were each judges of another court, there came before your Honours a case of Quinn v Rocla Concrete Pipes 6 NSWLR 586.

McHUGH J:   About questions was it not?

MR BRERETON:   Your Honour, it was about new trials.

KIRBY J:   This is where Justice McHugh said it was the worst possible thing he could imagine and so terrible.

MR BRERETON:   It was when his Honour said words to this effect, that while when the issues of liability and damages were completely separate, as they often were in a personal injuries case, it was often proper and, indeed, common place to order a new trial limited to damages, sight should not be lost of the fundamental rule enunciated by Justice Kitto in this Court in Pateman v Higgin that a new trial usually should be on all issues. 

Your Honour Justice Kirby took a similar view in deciding that because questions of damages, contributory negligence and liability were intertwined, there had to be new findings of fact on all issues.  Your Honour will not find that case in the bundle but it is just a convenient starting point.  The starting point then is that generally speaking when an intermediate appellate court orders a new trial it should usually be on all issues.  The question in this application ‑ ‑ ‑

KIRBY J:   But why are you going into all this?  Why do you rake over the coals about past decisions when we just have to interpret the Family Law Act?  It is bearing out Justice Gummow’s statement earlier today that the Bar table hates statutes.  This is what this case is about, is it not?

MR BRERETON:   It is more than the interpretation of the Family Law Act and it is more than just the interpretation of section 94 of that Act. It involves an appropriate appellate judicial approach to when a new trial should be ordered. The question on this application is special to proceedings under section 79 of the Family Law Act and in short it is whether, having allowed an appeal in proceedings under that section, the court can order a rehearing in which the new trial judge’s discretion is to be fettered and limited by being told that he or she must follow so much of the original trial judge’s discretionary exercise as was not disturbed on appeal and must not inquire into certain of the relevant considerations under section 79 subordinating his or her own judgment.

KIRBY J:   But the words of the statute are order a rehearing “on such terms and conditions” as appeared appropriate to the Full Court.  Why should we, especially one might say in the absolutely sad circumstances of this case where so much of a relatively small kitty has inevitably been gobbled up in legal proceedings, why is that provision not appropriate to be applied to what the Full Court did here?

MR BRERETON: Because section 79 discretion is a single, entire discretion which involves considering and weighing a number of factors specified in section 79.

KIRBY J:   But you will not address the words “on such terms and conditions”.  You just hate those words.

MR BRERETON: The court can impose terms and conditions and I do not resist the proposition that the Court can impose terms and conditions, but it cannot do so so as to fetter or limit the discretion which the trial judge is given by section 79. To do so means that the new trial judge is not having regard to all the considerations under section 79, and that cannot be a proper exercise of the judicial discretion.

KIRBY J:   Why would we not read the statute, that is to say “terms and conditions”, in the context of this Act, in the context of these kinds of disputes, where issues of strong emotion and feeling become involved in issues of money, and say the Parliament intended that after a third hearing in the Full Court that the Full Court should have the power to impose terms and conditions that say, “Well, we are going to divide off a particular issue which has gone off the rails, but we are not going to have a complete rehearing of the whole thing”?

MR BRERETON:   It makes no difference, with the greatest respect, whether it is the first hearing in the Full Court or the third hearing.

KIRBY J:   I agree, logically it does not, but the circumstances of this case are not unique.  Since I have been sitting here I have seen a number of these cases and why would one not infer that, at least in this context, the Parliament intended that the terms and conditions should stretch to things beyond costs and matters of that kind into, “We will allow a rehearing on a particular issue”?

MR BRERETON:   If the Full Court wants to do that, it can do so readily by permitting further evidence to be adduced before the Full Court and exercising its discretion in substitution for that of the trial judge, having regards to the evidence at trial.

KIRBY J:   Yes, but these are judges who come from all over Australia and reassembling the same Full Court has difficulties.

MR BRERETON:   Exactly.

KIRBY J:   In any case, a Full Court ought not, ordinarily, to be engaged as a trial court.  It should do its job as an appellate court and then leave it to the trial judge, or a trial judge, to deal with the trial issues that remain outstanding or that have miscarried.

MR BRERETON: One has to keep on coming back to what section 79 is about, and in particular what section 79(4) is about. That section authorises the alteration of property interests between spouses if the order is just and equitable and having regard to seven specified factors in section 79(4). In short, those factors can be summarised as the respective contributions of the parties, their respective present means and needs, and some other matters.

McHUGH J:   Mr Brereton, again and again courts bind trial judges when they send back matters to exercise discretion.  If a trial judge makes an error, the Court of Appeal says, “You wrongly took this into account.  Rehear the matter.  Don’t take that into account.”  Now, in that sense the trial judge is bound.  He is not looking at the matter afresh.

MR BRERETON:   That, with the greatest respect, your Honour, is quite different from saying to a trial judge, “There are three considerations – financial contributions, non‑financial contributions, home‑maker and parent contributions – which you are not to look at.  You are to assume that those contributions were equal and then all you are to do is to consider the impact that other factors have on that.”  Now, the trial judge just cannot weigh those contributions against the other factors unless he or she knows from evidence the strength, quality and nature of the contributions, otherwise one just cannot tell what weight is to be given to the contribution element on the one hand ‑ ‑ ‑

McHUGH J:   It may be difficult, but it is not impossible.  It is far from impossible.  Judges have to do this all the time.  Take another field altogether, take the field of defamation.  These days the jury find what the words mean, then the trial judge has to assess damages for them.  The trial judge who was hearing the whole matter, he might take a completely different view of the matter.  He might even think it is not defamatory.  These things happen and judges have to deal with it.  After all, you seek a new trial, and it is a discretionary remedy, and you get a new trial upon conditions.  Why should a court not say one of the conditions of the new trial is that you cannot take this or that into account?

MR BRERETON:   With respect, your Honour, we were the respondent in the Full Court.  We opposed the appeal.  At the end of the day, the court allows the appeal and orders a new trial at some time ‑ ‑ ‑

McHUGH J:   I am talking hypothetically.  If you are the appellant and you ask for a new trial and you are successful, why cannot the court say, “Yes, we will grant you a new trial but subject to these conditions:  you cannot litigate this issue or that issue”?

MR BRERETON:   But that is quite different, with respect, to what happened here where it was against the respondent that the conditions were imposed.

McHUGH J:   I understand that, but how is it different in principle?

MR BRERETON:   Because the grant of a new trial on terms and conditions carries with it the concept that if the remedy is granted to a person who seeks it, then terms may be imposed which, in a sense, limit what is granted.  It does not mean that terms can be imposed against the party who is the respondent, limiting that party’s rights on the new trial.

McHUGH J:   That is a clever answer, but surely it does not deal with the fact that the conditions of the new trial apply to both parties.  It may be true that the respondent is subjected to a new trial on conditions that he finds unfavourable, but so what, if the court has a general power to impose terms and conditions on rehearing?

MR BRERETON: The critical issue is whether that general power in section 94 cuts down or can be used so as to fetter the discretion under section 79.

McHUGH J:   That is true.  That is the critical question that Justice Kirby put to you at the commencement of the appeal.

MR BRERETON: When one appreciates that the section 79 discretion is a whole discretion which involves weighing a range of factors, it is impossible to see how that discretion can be properly exercised unless the judge has findings and evidence as to each of the relevant factors to be taken into account. If a judge is told, “Assume stage 1 has been completed and take the property as it was found by the trial judge, assume stage 2 is completed and take the contributions to be equal as found by the first trial judge”, the new trial judge cannot effectively balance – and perhaps I am repeating in a sense what I said earlier – the means and needs factors against the significance of the contributions simply by being told, “Assume they are equal.” The new trial judge needs to know, in order properly to exercise the discretion afresh, the strength, force and weight of the contributions on the one hand, so that they can be measured against the weight in the individual case of the so‑called section 75(2) factors. Otherwise, only half of the discretion is effectively being exercised.

KIRBY J:   That is the short of thing a Full Court would have to consider in deciding whether or not the terms and conditions appropriate to this case were to limit the scope of the reconsideration by the trial court.  But there is no indication here that that was not in the mind of the Full Court and, on the contrary, the saga of this litigation is precisely the circumstance in which one might say it was appropriate for them to do what they did.

MR BRERETON:   Your Honour, it is not, with respect, reasonable to use the saga of this litigation as ‑ ‑ ‑

KIRBY J:   But it is not atypical, Mr Brereton.  I have sat here ‑ ‑ ‑

McHUGH J:   But you can test it, can you not?  This is the sort of case that the Full Court has to deal with from time to time.

MR BRERETON:   But the other two cases which we have included in the bundle, the cases of Wall and of Gunns, are cases of a first appeal to the Full Court in which the Full Court has foreshadowed adopting, potentially, the same approach as it has in this case.

KIRBY J:   There could be a case where you could persuade this Court that the discretion had miscarried in the particular case.  I agree it would be difficult because this Court would not often interfere with such matters.  But the same restraint is imposed on us now unless we adopt a very narrow view of what “terms and conditions” mean.

MR BRERETON:   With respect, what is being put here is not a question of an appropriate exercise of discretion, but a question of principle.

McHUGH J:   I know.  You put it as a question of construction, but the general principle is that powers conferred on courts are given all the amplitude that the words are capable of.

MR BRERETON:   I accept that, your Honour, but that has to be set aside, that the general principle that discretionary decision‑makers are not to act under dictation and are not to have their discretion fettered and must take into account, and fully, all the relevant considerations.  Those two principles sit at loggerheads in the manner in which the Full Court has approached this and proposes to approach other cases, and that is what gives rise to the question of principle here.  It is probably unnecessary to go to the other cases which I have put in the bundle because they illustrate the court contemplating taking ‑ ‑ ‑

McHUGH J:   I have not read those other cases, so if there is any ‑ ‑ ‑

KIRBY J:   Do any of them touch on the very point that is before us? Is there a Full Court of the Family Court saying, “We would love to be able to restrict the remitter but we can’t do that because we are bound in the collision between section 94 and 79 to give primacy to 79”?

MR BRERETON:   I do not have anything that goes quite as nicely or quite as far as that, your Honour, but can I take your Honours to the judgment of the Full Court in Gunns v Gunns and, in particular, to paragraph 346 of that judgment, which I think is at page 138 of the print. The court in section 79 perceives ‑ ‑ ‑

KIRBY J:   It looks like a native title decision.  It is 163 pages.

MR BRERETON:   The court allowed an appeal reducing the contributions assessed in favour of the wife, but increasing what she was entitled on the means and needs factors, but overall reducing her entitlement.  At paragraph 346 the court said it was clear that since the trial the financial circumstances of the parties had changed.  At 347, that having regard to the decision of this Court in Allesch v Maunz it was appropriate to require or afford the parties an opportunity to adduce further evidence.  At 348 their Honours referred to the present case and the holding:

that this court has the power to remit proceedings for a limited rehearing –

and noted at the end of that that an application had been made to the High Court for special leave, which had yet been heard.  At 351, set out various options, first, an agreed statement of facts; secondly, at 352, a re‑exercise of discretion in the Full Court, perhaps on a partial basis, remitting the remainder to a trial judge; and at 353, to remit the matter, assuming the correctness of the present case, for a limited rehearing. 

Wall v Wall is another case in which the court is sitting on, or appears to be sitting on, similar arguments as to whether the matter should be limited for a rehearing ‑ ‑ ‑

KIRBY J:   You often find that there are similarities between the Federal Court of Australia Act and the Family Law Act in this regard.  Is there any equivalent provision in the Federal Court Act?

MR BRERETON:   There is a relevant distinction ‑ ‑ ‑

McHUGH J:   There is a decision, is there not?

MR BRERETON:   There is a decision of Justice Finkelstein which, if I can take your Honours to that, powerfully illustrates the distinction.

McHUGH J:   Is that CPSU, is it?  Is that right?

MR BRERETON:   That is the decision, yes, your Honour.  At paragraph 13 his Honour sets out the relevant extracts of section 21 of the Federal Court Act and it will be seen that section 28(1)(c) authorised setting aside the judgment appeal from ‑ ‑ ‑

McHUGH J:   We do not seem to have a copy.  It is not on the list of authorities.

MR BRERETON:   It is in the respondent’s list, as I understand it, your Honour.

KIRBY J:   Anyway, we do not have time and we do not have it, so tell us.

MR BRERETON:   In any event, section 28(1)(c) of that Act authorises the setting aside of:

the judgment appealed from, in whole or in part, and remit the proceeding to the court from which the appeal was brought for further hearing and determination ‑ ‑ ‑

KIRBY J:   There is a problem there because of the structure of that subsection.

MR BRERETON:   Yes, and then section 28(1)(f) authorises granting a new trial.  So there are two different concepts:  remitting for further hearing, which is what Justice Finkelstein held had happened in that case, and granting a new trial.  There is no equivalent provision in the Family Law Act authorising remittal for further hearing as opposed to rehearing, which, in our submission, is the same thing as a new trial. So that construction or comparison, in our submission, supports the view that section 94 of the Family Law Act does not authorise anything other than ‑ ‑ ‑

KIRBY J:   Not really.  They are dealing with different statutes with a different structure and I do not think it really casts any light on whether it is correct or not.  What the Federal Court has decided has never been passed on by us.  All we have is the Family Law Act, a collision between two provisions, and you chipping away at one which is expressed in very wide terms.  It may be that just such a case ‑ ‑ ‑

MR BRERETON:   Let me illustrate, for example, how terms and conditions can be imposed.  Often issues concerning children and property are tied up.  Often questions of with whom a child shall reside is tied up with the question of division of property.  The court could easily remit ‑ ‑ ‑

KIRBY J:   You want it to be collateral to the issue for determination?

MR BRERETON:   The one trial, your Honour, might well deal with questions of residence, contact, property and maintenance, run for a couple of days before the same trial judge at the same time, with a single judgment disposing of all issues.  It is a common place.  The one appeal may deal with all of those issues.  The court could remit for retrial, say, the property issues and nothing else, because that property question would be a single matter to go back ‑ ‑ ‑

KIRBY J:   There you are into the substance and if it can be part of the substance, then it can be part of the part of the substance.

MR BRERETON:   With respect, the difficulty with that is it involves, as I have sought to put, severing or dividing a discretion and saying that the trial judge must start this discretionary exercise from a particular position.

KIRBY J:   No.  It is saying, “You will deal with this under terms and conditions which we fix, which are that you will deal only with that part of the issue which has miscarried, in our opinion.”

MR BRERETON:   Which then means that the trial judge is not fully examining the relevant considerations under the section.

KIRBY J:   Yes, the trial judge does but within parameters which, by the terms and conditions fixed by the Full Court, are examined by that judge.

MR BRERETON:   I think the lights indicate that your Honour has the last word.

KIRBY J:   Yes, but you would have one more sentence when I am here.  Out of our great mercy, we give that.

MR BRERETON:   May it please the Court.

McHUGH J:   No, we do not need to hear you, Mr Holmes.

The question in this application is whether it was open to the Full Court of the Family Court of Australia to limit the issue remitted for rehearing by a single judge of that court. By section 94(2) of the Family Law Act 1975 (Cth), the court is empowered to order a rehearing on such terms and conditions, if any, as it considers appropriate. Given that the power is conferred on an appellate court of a superior federal court, it is our view that the words of section 94 are apt to support the order made by the Full Court in this case.

The facts of the case, including no fewer than three hearings before the Full Court, are not unique in this area. They demonstrate why it would be wrong to put a narrow construction on section 94 simply because of the existence of the very broad discretion conferred on the Family Court by section 79 of the Act. There was no error in the judgment of the Full Court. Special leave is refused with costs.

Call the next matter.

AT 11.54 AM THE MATTER WAS CONCLUDED