XY v UV
[2024] QSC 262
•1 November 2024
SUPREME COURT OF QUEENSLAND
CITATION:
XY v UV [2024] QSC 262
PARTIES:
XY
(applicant)
v
UV(respondent)
FILE NO/S:
BS 14083 of 2024
DIVISION:
Trial division
PROCEEDING:
Originating application
ORIGINATING COURT:
Supreme Court at Brisbane
DELIVERED ON:
1 November 2024
DELIVERED AT:
Brisbane
HEARING DATE:
29 October 2024
JUDGE:
Cooper J
ORDER:
1. The originating application filed on 18 October 2024 is dismissed.
2. Within seven days of the date of this judgment the parties are to bring in short minutes of order recording the terms of a suppression order to be made by the Court in respect of material placed before the Court, and any transcript produced, in connection with this proceeding.
3. Until 4.00pm on 8 November 2024 or further order, this judgment and its contents are not to be disclosed, by publication or otherwise, to any person other than (a) the parties and their legal representatives; and (b) the Arbitrator.
4. I will hear the parties as to costs.
CATCHWORDS:
ARBITRATION – CONDUCT OF ARBITRAL PROCEEDINGS – PROCEDURE AND EVIDENCE – EVIDENCE AND OTHER MATTERS – where the parties’ dispute has been referred to arbitration – where the applicant seeks relief from producing certain documents sought through discovery in the arbitration to either the arbitrator or to the respondent on the grounds of parliamentary privilege and public interest immunity – where the respondent argues that the Court does not have jurisdiction to rule on those claims raised in the arbitration because to do so would involve the Court intervening in the arbitration and s 5 of the Commercial Arbitration Act 2013 (Qld) has displaced the Court’s jurisdiction to determine those claims – whether s 5 of the Commercial Arbitration Act 2013 (Qld) displaces the Supreme Court’s inherent jurisdiction to determine the parliamentary privilege and public interest immunity claims because those claims are currently before the arbitrator for determination
ARBITRATION – CONDUCT OF ARBITRAL PROCEEDINGS – PROCEDURE AND EVIDENCE – EVIDENCE AND OTHER MATTERS – where the respondent alternatively argues that relief should be refused on discretionary grounds because the applicant has not challenged the arbitrator’s determination that he has jurisdiction to determine the privilege and immunity claims – where the applicant raised its claims as a basis for resisting the production of documents sought in the arbitration where the arbitrator had made procedural orders scheduling an evidentiary hearing – where the parties had duties under statute to progress the arbitral proceedings expeditiously and to comply with any order or direction of the tribunal without undue delay – where the applicant argued before the arbitrator that the arbitrator did not have jurisdiction to rule on the privilege and immunity claims but those arguments were rejected – where the applicant did not seek a decision from the Supreme Court as to the arbitrator’s jurisdiction but rather brought the present proceedings – where the effect of granting the relief sought will nevertheless be to prevent the arbitrator from exercising jurisdiction over the privilege and immunity claims – whether the Court should exercise its discretion to grant the relief sought
Commercial Arbitration Act 2013 (Qld), s 5
CPB Contractors Pty Ltd and Hansen Yuncken Pty Ltd v State of South Australia [2024] SASC 46, considered
Commonwealth v Cockatoo Dockyard Pty Ltd (1995) 36 NSWLR 662, considered
Hancock Prospecting Pty Ltd v DFD Rhodes Pty Ltd (2020) 55 WAR 435, followed
L W Infrastructure Pte Ltd v Lim Chin San Contractors Pte Ltd [2013] 1 SLR 125, considered
Republic of India v Vedanta Resources plc [2021] 2 SLR 354, not followed
State of Victoria v Seal Rocks Victoria (Australia) Pty Ltd (2001) 3 VR 1, considered
Transurban WGT Co Pty Ltd v CPB Contractors Pty Ltd [2020] VSC 476, citedCOUNSEL:
J Horton KC with R McDermott for the applicant
T Mehigan SC with S Tame and M Doyle for the respondent
SOLICITORS:
Crown Law for the applicant
Ashurst for the respondent
The parties to this proceeding are also parties to a dispute which has been referred to arbitration pursuant to the provisions of the Commercial Arbitration Act 2013 (Qld) (CAA). Following that referral, the parties agreed to the appointment of a retired judge of the Supreme Court of Western Australia as arbitrator (Arbitrator).
The arbitration agreement is contained in a deed which governs the parties’ commercial relationship. The terms of that deed are confidential. The arbitration is also confidential. To preserve that confidentiality, the names of the parties have been anonymised for the purposes of this proceeding. XY is the applicant in this proceeding and the respondent to the arbitration. UV is the claimant in the arbitration and the respondent in this proceeding.
By this proceeding, XY seeks an order that it is relieved from producing certain documents in the arbitration to either the Arbitrator or UV on the grounds of Parliamentary Privilege (PP) and Public Interest Immunity (PII).
In response to that application, UV argues that this court cannot grant the relief as it does not have jurisdiction to rule on the PP and PII claims raised in the arbitration. To grant the relief sought by XY would involve the court intervening in the arbitration. On UV’s argument that is prohibited by s 5 of the CAA. In short, UV submits that s 5, properly construed, has expressly or impliedly displaced the court’s inherent jurisdiction to determine claims of PP and PII in circumstances where those claims are raised in an arbitration conducted pursuant to the CAA.
In the alternative, UV submits that if s 5 of the CAA has not displaced the court’s jurisdiction to determine the PP and PII claims, in the exercise of its discretion the court should decline to rule on those claims because they are currently before the Arbitrator for determination.
It was accepted by both parties that the court should determine the jurisdictional issue raised by UV before hearing any substantive argument on the PP and PII claims.
For the reasons which follow, I have concluded that s 5 of the CAA has not displaced the inherent jurisdiction of the court to determine claims of PP and PII that are raised in an arbitration conducted pursuant to the CAA. However, given the stage that the arbitration, and particularly the agitation of the PP and PII claims in the arbitration, has reached I consider it is appropriate to leave those claims to be determined by the Arbitrator. That is, I accept UV’s submission that in the circumstances of this case the discretionary relief XY seeks should not be granted. Accordingly, the originating application will be dismissed.
The course of the arbitration to date
Pursuant to the terms of the arbitration agreement, UV issued a notice referring the dispute to arbitration in December 2023. As already observed, the Arbitrator was appointed on 19 February 2024. Since that time, the parties have progressed the conduct of the arbitration in accordance with procedural orders made by the Arbitrator.
Relevantly for the purposes of this proceeding, after the exchange of pleadings each party was to deliver to the other a list of requests for documents, or categories of documents, that the requesting party considered to be relevant to the issues in dispute and which should be required to be produced.
UV identified the documents it sought from XY and XY responded by indicating its objection to producing some documents. The Arbitrator then issued a decision on 26 June 2024 addressing UV’s requests and XY’s response. XY was directed to produce documents identified in a schedule to the decision, subject to any properly formulated objection to produce documents which are the subject of (relevantly) legal professional privilege or any other privilege from disclosure such as PII.
Following that decision, XY discovered a total of 6,490 documents. Of those documents:
(a)1,918 documents were produced free from redactions;
(b)945 documents were produced in redacted form; and
(c)3,627 documents were wholly withheld from production.
XY articulated the basis of its objections to producing documents (in whole or in part) which included claims of PP and PII.
On 13 September 2024, UV informed XY of its challenges to XY’s objections to producing documents in the arbitration, including the objections based on XY’s claims of PP and PII. On the same date, UV requested that the Arbitrator convene a procedural hearing for the purposes of determining the appropriate forum and procedure to determine XY’s objections to the production of documents.
The Arbitrator convened a hearing on 4 October 2024 for that purpose and received written and oral submissions from the parties. At that hearing, there was no dispute that UV’s challenge to XY’s objections to production on the grounds of legal professional privilege and without prejudice privilege should be determined by the Arbitrator. There was, however, a dispute about the appropriate forum and procedure for determining XY’s objections to production by reason of its claims of PP and PII.
As recorded in the decision of the Arbitrator delivered on 5 October 2024, XY’s position at the hearing on 4 October 2024 was that its PP and PII claims can and should be determined by this court and, further, that the Arbitrator did not have jurisdiction to determine those claims because (among other reasons):
(a)the Arbitrator’s jurisdiction extends only to those matters which are the subject of the arbitration agreement and incidental or procedural issues which arise while determining the disputes which are the subject of it;
(b)XY’s PP and PII claims fall outside the subject of the arbitration agreement;
(c)further, those claims are not incidental or procedural to questions of discovery because the existence of PP and PII is freestanding as a matter of high public policy and entirely separate from the commercial disputes between the parties.
The Arbitrator held that he had jurisdiction to determine XY’s objections to the production of documents based on its PP and PII claims, and that he would exercise that power. On the question whether he should exercise the jurisdiction which he found to exist, the Arbitrator referred to his obligation to conduct the arbitration to avoid unnecessary delay and expense and provide a fair and efficient process for resolving the parties’ dispute. He also referred to the fact that, with the consent of the parties, the evidentiary hearing for the arbitration has been scheduled to commence on 10 February 2025.
In that context, the Arbitrator considered that the arbitration would be progressed most expeditiously by him deciding XY’s objections to the production of documents based on its claims of PP and PII, as well as the objections to production on the grounds of legal professional privilege and without prejudice privilege.
Following delivery of that decision, the Arbitrator made further directions on 9 October 2024. Those directions required that XY deliver evidence in support of its objections to production, UV provide any revised list of challenges to XY’s objections and junior counsel confer to seek to narrow the scope of UV’s challenges to the objections. A further matter for conferral by junior counsel was said to be agreement on which challenges to XY’s objections are to be resolved by an independent expert. As to this, the directions required that XY provide UV with a list of three retired judges, King’s Counsel or senior legal practitioners who are available to be appointed to act as an independent expert to prepare a written report to the Arbitrator under s 26 of the CAA. UV was required to select one of the three independent experts proposed by XY and that person would be appointed by consent.
UV’s submissions on jurisdiction
UV’s submissions, both in its written outline and at the hearing, emphasise that its jurisdictional argument does not deny the existence of the inherent jurisdiction of this court to decide PP and PII claims. Rather, it submits that this inherent jurisdiction has been displaced, expressly or by necessary implication, by the terms of s 5 of the CAA, construed in the context of the statutory framework which the CAA has put in place for the determination of commercial disputes by arbitration and the respective functions which the statutory provisions confer on the arbitral panel (here the Arbitrator) and the court in respect of that process.
Section 5 provides as follows:
“In matters governed by this Act, no court must intervene except where so provided by this Act.”
UV’s central contention is that the prohibition on court intervention in s 5, properly construed, is an express or implied removal of the power of the court to deal with the PP and PII claims that have arisen in the arbitration. Implicit in that submission is the contention that PP and PII claims that arise in the arbitration are matters that are governed by the CAA within the meaning of s 5.
I address the construction of s 5 later in these reasons. For present purposes it is sufficient to note UV’s submission that, understood in that context, the displacement effected by s 5 of the CAA operates only to the limited extent that PP and PII claims arise for determination in an arbitration conducted pursuant to the provisions of the CAA. The outcome of that determination by the Arbitrator would bind only the parties to the arbitration, and then only for the purposes of the arbitration.
UV submits that XY’s rejection of this limited displacement of the court’s inherent jurisdiction is largely based on statements of principle drawn from cases which considered legislation which pre-dated the enactment of uniform commercial arbitration legislation of which the CAA forms part and contained no equivalent to s 5 of the CAA.
UV’s submissions emphasise that acceptance of its construction of s 5, and the limited displacement of the court’s inherent jurisdiction which it has effected, would not involve an abrogation of XY’s right to have its PP and PII claims determined. That is, there would be no abrogation of a fundamental right that enures in the body politic. All that has occurred is that, in circumstances where such claims arise for determination as an aspect of a dispute that is properly the subject of a referral to arbitration in accordance with the provisions of the CAA, s 5 operates to displace the inherent jurisdiction of the court to determine those claims in favour of the claims being determined by the arbitral tribunal. As XY has agreed to arbitrate the dispute in which the PP and PII claims have arisen for determination, no public policy is offended if those claims are determined by the Arbitrator (as he has foreshadowed an intention to do) and not the court.
To that extent, UV’s submissions are expressly premised on XY no longer challenging the jurisdiction of the Arbitrator to determine the PP and PII claims. That is because, in deciding that he has jurisdiction to determine those claims, the Arbitrator exercised his power to rule on his own jurisdiction pursuant to s 16(1) of the CAA. In that situation, pursuant to 16(9) of the CAA, within 30 days of that decision XY may request that the court decide the question of the Arbitrator’s decision, but it has not done so. This was confirmed in XY’s oral submissions.[1]
[1]Transcript 1-34:23-28.
XY’s submissions on jurisdiction
XY submits that s 5 does not operate to displace the court’s inherent jurisdiction to rule on PP and PII claims, in circumstances where such claims exist by reason of high public policy and necessitate the weighing of competing public interests. PP and PII derive from deep constitutional history and raise considerations that are fundamental to the operation of the body politic. XY relies on the constitutional convention, evidenced in section 3.11.5 of the Queensland Government Handbook, that, following the change of government in Queensland since the arbitration commenced, certain of the documents the subject of PII claims are not available to the new government. In XY’s submission, this highlights the impermissibility that such documents might be produced to the Arbitrator or an expert appointed under s 26 of the CAA.
On XY’s submission, clear statutory language would be needed for the CAA to have curtailed the court’s inherent jurisdiction to determine the PP and PII claims and such language cannot be found in the CAA. In XY’s submission, the CAA deals with commercial disputes, not questions of public law of the type raised by its PP and PII claims. Although the CAA expressly provides that the Arbitrator may make orders with respect to discovery, it is silent on the adjudication of PP and PII claims. Those claims are not merely incidental to the production of documents in the arbitration but are founded on freestanding common law principle; they are not matters governed by the CAA.
XY does not accept the correctness of the distinction that UV draws between the limited displacement of the court’s inherent jurisdiction in the context of PP and PII claims arising in the arbitration and the abrogation of the right to object to production of documents based on claims of PP and PII. XY submits that it is entitled to resist the production of documents the subject of its PP and PII claims to any third party, including the Arbitrator and any expert appointed pursuant to s 26 of the CAA. The construction of s 5 of the CAA for which UV contends, resulting in production of documents subject to the PP and PII claims to the Arbitrator or the expert, and the determination of the claims by the Arbitrator, would necessarily reduce or impair that right.[2]
[2]Transcript 1-33:15-44.
XY accepts that if it is granted the relief it seeks, the Arbitrator may be prevented from exercising the jurisdiction which he has found he possesses, and which he has decided it is appropriate for him to exercise.[3] XY further accepts that this would amount to an intervention in the arbitration.[4] Nevertheless, XY submits that this intervention is permitted because the determination of PP and PII claims are not matters governed by the CAA, and so not subject to the prohibition on intervention imposed by s 5.
[3]Transcript 1-34:30-35.
[4]Transcript 1-35:4-10.
Relevant decisions preceding the enactment of the CAA
XY relies upon the decision of the New South Wales Court of Appeal in Commonwealth v Cockatoo Dockyard Pty Ltd[5] as authority for the proposition that there are bounds to the power of an arbitral tribunal to reach into questions of fundamental public interest.
[5](1995) 36 NSWLR 662 (Cockatoo Dockyard).
Cockatoo Dockyard involved consideration of s 14 of the Commercial Arbitration Act 1984 (NSW) (the 1984 NSW Act) which relevantly provided:
“Subject to this Act and to the arbitration agreement, the arbitrator or umpire may conduct proceedings under that agreement in such manner as the arbitrator or umpire thinks fit.”
The arbitrator made confidentiality orders under that power which had the effect of requiring that the Commonwealth to keep confidential, and not use or disclose, its own documents, being documents that were not specifically brought into existence in connection with the with the arbitration.[6] The Commonwealth argued that these orders went beyond the power of the arbitrator and unreasonably interfered with its governmental rights and duties and that the court had the power and duty to provide relief by setting aside the impugned orders.
[6]Cockatoo Dockyard, 664F-G.
Kirby P (as his Honour then was; Priestley JA agreeing) commenced his analysis by considering the power of the court to review an interlocutory order or direction of an arbitrator. This was done in the context of decisions of the Court of Appeal, which were relied upon by the primary judge in rejecting the Commonwealth’s submission that the court had jurisdiction to intervene, which identified a general policy of non-interference by the courts in arbitrations under the 1984 NSW Act reflecting amendments to the legislation which, in turn, had followed strongly expressed parliamentary statements to that end.[7]
[7]Cockatoo Dockyard, 670F-G citing Promenade Investments Pty Ltd v State of New South Wales (1992) 26 NSWLR 203; Natoli v Walker (Court of Appeal, 26 May 1994, unreported).
As to the court’s inherent jurisdiction, and the statutory expression of that jurisdiction in s 23 of the Supreme Court Act 1970 (the equivalent of which for this proceeding can now be found in s 58 of the Constitution of Queensland 2001), Kirby P observed that where it is suggested such jurisdiction is ousted by legislation it is necessary, as a matter of statutory construction, for this to be demonstrated by reference to express words or necessary implication.[8]
[8]Cockatoo Dockyard, 674D-E and the cases cited there.
Kirby P acknowledged the force of the observations by the primary judge that it was inherent in the language and purpose of the 1984 NSW Act that Parliament had established a code to regulate arbitrations and that parties who agreed to submit their disputes to arbitration were bound by that code. The code was to be strictly adhered to and interference by the court limited to the rare cases envisaged by the legislation. In such circumstances the Court was bound to adhere to the principle of restraint and acknowledge that its jurisdiction had been ousted by a clearly expressed parliamentary intention to that end. Kirby P accepted the correctness of these observations where a matter is within the scope of an arbitration.[9]
[9]Cockatoo Dockyard, 674G – 675E.
The position was different where orders made by an arbitrator went beyond the ambit of orders that might properly be made within the scope of the arbitration. Kirby P described as “unacceptable” the proposition that the court is incapable of providing relief, and has lost its powers altogether, because parties have entered into a private contract by which they have submitted a dispute to arbitration.[10] His Honour observed:[11]
“Allowing that a large circle will be drawn within which the arbitrator may make procedural orders, the circle is not without limit. A point will be reached where the edge of the circle will be arrived at and passed. When passed, the Court, upholding the other interests which lie outside the legitimate scope of the arbitration, will retain its powers to intervene. To deny those powers is to accord too great a right to the parties or the arbitrator to define the limits of the commercial arbitration which the Act protects from external curial intervention. The power to define the boundaries and to prevent directions which go beyond them, remains in the Court. Any other view permits the parties and the arbitrator to define, without limitation, the territory which they occupy pursuant to their private agreement. That cannot be. The rule of law requires that the Court, protective of other competing public and private interests, will define and, where necessary and appropriate, declare the limits beyond which the purported powers in pursuit of private arbitration intrude into competition with other legitimate public and private rights and duties.”
And later, to similar effect:[12]
“I deny the right of the arbitrator, or the parties, by contract or direction, to define conclusively the proper scope of their arbitration, the limits of the ambit of the Act or the lawfulness of directions purportedly made under the Act but actually outside its domain. Where such an excess of jurisdiction exists, it is both proper and necessary that the jurisdiction of this Court should remain to uphold the rule of law and to safeguard other competing lawful rights and duties. Whether this Court's residual jurisdiction arises from its large inherent powers derived ultimately from the sovereign or from the powers additionally given by s 23 of the Supreme Court Act 1970, I do not have to decide. The powers survive because the Commercial Arbitration Act will support only such directions as are lawfully made within the large ambit of the operation of that Act. Stray outside that ambit, and the supervisory power of this Court remains to provide relief at the behest of a party showing a requisite interest to invoke that relief.”
[10]Cockatoo Dockyard, 675E.
[11]Cockatoo Dockyard, 675G – 676B.
[12]Cockatoo Dockyard, 677C-E
Kirby P also addressed the contention that the orders which were sustained by the power to make procedural orders conferred by s 14 of the 1984 NSW Act. After citing a passage from the judgment of Mason CJ in Esso Australia Resources Ltd v Plowman,[13] which addressed s 14 of the Commercial Arbitration Act 1984 (Vic) (the 1984 Vic Act, being the Victorian analogue of s 14 of the 1984 NSW Act), Kirby P stated:[14]
“The foregoing emphasises that the arbitrator, as the donee of power, does not thereby secure jurisdiction at large. The procedural power is only given as an incident to the conduct of the arbitration. The arbitrator could not, in purported exercise of this procedural power, give directions at large which affected the Government of the Commonwealth. Nor could the arbitrator give directions which, without lawful authority, effectively over-rode Federal or State legislation. The parties' private agreement would not endow the arbitrator with such powers to over-ride the law.”
And later, to similar effect:[15]
“Where an arbitrator, in the course of giving a procedural direction, goes beyond the establishment of procedures necessary for the commercial arbitration between the parties and makes orders which impinge upon the public's legitimate interests, the arbitrator goes outside the arbitration. Certainly, the arbitrator cannot then point to s 14 of the Act, unelaborated, as a basis to sustain directions made. There will be a fine line between procedural directions which are within the large ambit that s 14 permits and those which go beyond. To the former, the Court will show restraint, reserving any complaint to be made to the end of the arbitration in any challenge that may lawfully be brought from a final (or interim) award or for the removal of the arbitrator for misconduct. But where the Court concludes that the direction made has gone beyond the purposes of the arbitration proceedings, and is thus extra-jurisdictional and unlawful, it will, in a proper case, provide relief. In my view, this is such a case.”
[13](1995) 183 CLR 10.
[14]Cockatoo Dockyard, 678D-E.
[15]Cockatoo Dockyard, 679F-G (italics in original).
Ultimately, Kirby P concluded that the orders made by the arbitrator took him beyond the arbitration which was his legitimate concern. Properly characterised, those orders went beyond the concerns of the arbitration. Neither the arbitration agreement nor the provisions of the 1984 NSW Act conferred such a power on the arbitrator. That purported exercise of power brought the arbitrator into conflict with the competing considerations identified by the Commonwealth and that conflict permitted the intervention of the court.
XY relies on these statements by Kirby P in support of its submission that the UV’s construction of s 5 of the CAA would give the Arbitrator the power to compel XY to produce the documents that are the subject of the PP and PII claims to him or to the expert appointed under s 26 of the CAA. XY submits that (as distinct from the Arbitrator’s jurisdiction to decide PP and PII claims concerning documents which have been produced to him, which is not challenged in this proceeding – see [25] above) nothing in the statutory language used in s 5, nor in any other provision of the CAA, has the effect of enlarging the jurisdiction of the Arbitrator beyond that described by Kirby P in Cockatoo Dockyard such that he could compel the production of documents the subject of PP and PII claims.
The parties also referred to the decision of the Victorian Court of Appeal in State of Victoria v Seal Rocks Victoria (Australia) Pty Ltd.[16] In an arbitration under the 1984 Vic Act, documents the subject of PII claims were produced to the arbitrator. The arbitrator proceeded to determine those claims and rejected most of them. The State then commenced a proceeding in the Supreme Court of Victoria by originating motion to challenge the arbitrator’s rulings, relying upon s 47 of the 1984 Vic Act and the inherent jurisdiction of the court. Section 47 of the 1984 Vic Act provided:
“The Court shall have the same power of making interlocutory orders for the purposes of and in relation to arbitration proceedings as it has for the purposes of and in relation to proceedings in the Court.”
[16](2001) 3 VR 1 (Seal Rocks).
The State’s motion was dismissed at first instance on the basis that the court had no power to intervene. On appeal, that decision was reversed and the PII claims were remitted for determination by the primary judge.
Ormiston JA (Phillips and Buchanan JJA agreeing) rejected the submission that s 47 could support or justify any orders sought from the court and should not be construed as providing a means of appeal or review of an arbitrator’s decisions. The provision was intended only to invest ancillary jurisdiction in the court so as to enable it to act in aid of the arbitration by making interlocutory orders of a kind which are beyond the powers of the arbitrator.[17]
[17]Seal Rocks, 4 [9].
The decision in Seal Rocks turned on the question whether the court’s inherent jurisdiction had been ousted or displaced, in particular because it was implicit from the structure and provisions of the 1984 Vic Act that there should be no review of any finding of an arbitrator unless explicitly authorised by a provision of that Act.[18]
[18]Seal Rocks, 4 [6].
In considering that issue, Ormiston JA referred to the need to be cautious in reaching conclusions of a superior court of record where that is said to be based on implications drawn from an Act of Parliament. Accepting the correctness of the statement of Kirby P in Cockatoo Dockyard, that “there is no inherent jurisdiction … to supervise decisions made by the arbitrator within the arbitration”, Ormiston JA framed the question for determination as being whether an arbitrator’s decision as to the existence of PII, by way of an incidental ruling as to evidence or the production of documents, is properly characterised as a decision “within the arbitration”.[19]
[19]Seal Rocks, 5-6 [13].
Ormiston JA acknowledged the wide powers conferred on an arbitrator by s 19 of the 1984 Vic Act concerning matters of evidence and the many incidental evidentiary issues and procedural issues that arise in the course of an arbitration. His Honour recognised that an arbitrator is entitled to rule upon those issues on the basis that, in the ordinary case, they fall within the scope of the arbitration. Nevertheless, his Honour considered PII claims to be of a different character. The reasons for that conclusion were set out in the following passage:[20]
“Whatever might be argued in relation to other claims for privilege by parties, the present claim was of a different order. The right of the Crown or government to assert that cabinet documents and the like are immune from production is a matter of high public policy. It is not the subject of waiver or acquiescence: it cannot, for example, be resolved by decision of the government of the day. It is public policy in the strictest sense which requires that documents of this kind be immune from public disclosure generally or even disclosure for the limited purposes of litigation or arbitration. The rationale behind the immunity has been discussed on a number of occasions in recent years by courts of the highest authority and, more especially by the High Court. ….
In my opinion, therefore, public interest immunity in a document or other communication is a right by way of an immunity or a privilege which enures in the body politic and indeed in the nation (or relevant polity) as a whole, and not merely in the executive, being designed to protect the operation of the instruments of government at the highest level and for the benefit of the public in general, subject only to a court’s reaching a conclusion to the contrary on sound grounds that no other public interest, especially in the administration of justice, should prevail in the particular circumstances. It follows, as has been held on numerous occasions, that the making of a claim for this immunity by the Crown, or by any other party to the proceeding for that matter, is not necessary, for it is the court’s duty to consider the possible application of the immunity, whenever it may appear to arise, subject only to satisfying itself, after appropriate argument, that it does apply and that any relevant countervailing factors ought not to deny the immunity.
The short point is that a claim to public interest immunity, though ordinarily taken by the Crown, is not a conventional right capable of being waived at will. Nor is it the kind of claim which can itself be referred to arbitration, although there is no reason in the ordinary case why the arbitrator should not attempt to do what a court is required to do. But the resolution of such a claim is not the kind of incident to an arbitration which should be protected from review by this court by reason of any general policy relating to the law of arbitration or to be implied from any statute relating to that subject. Naturally, if the Act had specifically dealt with the subject, one would have to comply with Parliament’s express wishes, for it has the power to restate the relevant public policy. That, however, has not occurred.
The question raised by this appeal is whether the inherent jurisdiction of this court to resolve an issue of public interest immunity has been taken away expressly or impliedly by the provisions of the Act. It is unnecessary to examine authority in order to assert that that jurisdiction can only be lost if it is shown to be the clear intendment of Parliament. That has not been here demonstrated for the relevant jurisdiction as to this immunity is not to be characterised merely as part of the jurisdiction of the arbitrator to resolve the referred dispute, except to the limited extent necessary to resolve the dispute. But the immunity is not truly part of the dispute referred by the parties to arbitration and it cannot be concluded by any ruling or award of the arbitrator. …”
[20]Seal Rocks, 6-7 [16]-[19] (citations omitted).
It is clear from this passage that, prior to the enactment of the CAA, the court’s inherent jurisdiction to rule on PP and PII claims had not been implicitly displaced by earlier legislation governing the conduct of domestic commercial arbitrations. While acknowledging this, UV submits that this position changed when the CAA and its analogue statutes in other States were enacted as part of uniform legislation intended to align domestic commercial arbitration with the International Arbitration Act 1974 (Cth) (IA Act) as amended to give effect to the UNCITRAL Model Law on International Commercial Arbitration (Model Law). Importantly, UV submits that the earlier arbitration legislation considered in Cockatoo Dockyard and Seal Rocks had no equivalent of s 5 of the CAA and, as already observed, it is this provision, construed in the context of the framework for arbitrations created by the CAA, which implicitly displaces the inherent jurisdiction of the court to determine XY’s claims of PP and PII.
The statutory framework created by the CAA
The paramount object of the statute is to facilitate the fair and final resolution of commercial disputes by impartial arbitral tribunals without unnecessary delay or expense: s 1AC(1). The legislation aims to achieve that paramount object by enabling parties to agree about how their commercial disputes are to be resolved, subject to such safeguards as are necessary in the public interest: s 1AC(2)(a). Its provisions must be interpreted so that, as far as practicable, the paramount object is achieved: s 1AC(3).
Subject to that paramount object, in interpreting the provisions of the CAA regard is to be had to the need to promote, so far as practicable, uniformity between the application of the legislation to domestic commercial arbitrations and the application of the provisions of the Model Law (as given effect by the IA Act) to international commercial arbitrations: s 2A(1). To that end, reference may be made to the documents relating to the Model Law of the United Nations Commission on International Trade Law and its working groups for the preparation of the Model Law: s 2A(3).
Although I have already set out the terms of s 5 above, I do so again for convenience as it is the critical provision on the present application. It provides:
“In matters governed by this Act, no court must intervene except where so provided by this Act.”
The CAA then confers certain functions on this which are described in the heading to s 6(1) as being for “arbitration assistance and supervision”. Those functions concern matters that include:
(a)the appointment of arbitrators: ss 11(3)-(4);
(b)determination of challenges to arbitrators: s 13(4);
(c)termination of an arbitrator’s mandate: s 14(2);
(d)review of an arbitrator’s ruling as to jurisdiction: s 16(9);
(e)recognition and enforcement of interim measures issued by an arbitrator: ss 17H and 17I;
(f)the issuing of interim measures by the court: s 17J;
(g)the enforcement of orders or directions of an arbitrator as orders of the court: s 19(6);
(h)assistance with the taking of evidence, including by the issuing of subpoenas: ss 27 to 27B;
(i)prohibiting or allowing disclosure of confidential information in certain circumstances: ss 27H and 27I;
(j)determining questions of law which arise in the arbitration: s 27J;
(k)making orders in relation to the costs upon the failure of an arbitration: s 33D;
(l)recourse against awards issued by an arbitrator: ss 34 and 34A.
UV particularly relies upon the following aspects of the framework established by the CAA:
(a)unless the parties agree otherwise, broad powers are conferred on the arbitral tribunal to “conduct the arbitration in such manner as it considers appropriate (s 19(2)) and to “determine the admissibility, relevance, materiality and weight of any evidence” (s19(3));
(b)an order made by the arbitral tribunal is, by leave of the court, enforceable in the same manner as if it were an order of the court (s 19(6));
(c)the arbitral tribunal has the power to grant interim measures, including order with respect to “discovery of documents and interrogatories” (s 17(3)(b);
(d)an interim measure issued by the arbitral tribunal, including an order with respect to discovery of documents, “is to be recognised as binding and, unless otherwise provided by the arbitral tribunal, enforced on application to the court (s 17H(1));
(e)the court may only refuse to recognise or enforce an interim measure in limited circumstances (s 17I);
(f)the parties are subject to a general duty to do all things necessary for the proper and expeditious conduct of the arbitration (s 24B(1)), including without limitation:
(i)complying without undue delay with any order of the arbitral tribunal with respect to any procedural, evidentiary or other matter (s 24B)(2)(a)); and
(ii)taking without undue delay any necessary steps to obtain a decision (if required) of the court with respect to any function conferred on the court under s 6 (s 24B(2)(b);
(g)unless the parties agree otherwise, the arbitral tribunal is granted powers which it may exercise in the event a party defaults in the performance of procedural steps or orders (s 25).
UV submits that this statutory machinery has been enacted on the premise that all matters connected with the production of documents and their use in the arbitration is under the control of the arbitral tribunal. On UV’s argument, it is the Arbitrator who has been granted control over matters of procedure in the arbitration, including the production of documents and the determination of objections to the production of documents. There is no statutory mechanism under the CAA that allows the court to rule on the PP and PII claims made by XY in objecting to the production of documents in the arbitration when those matters are within the jurisdiction of the Arbitrator (as he has ruled) and are currently before him for determination. In those circumstances, UV submits that the court’s role is to recognise and enforce the orders of the arbitral tribunal on these matters. If the court was to grant XY the relief it seeks on the present application, it would amount to the court intervening in the arbitration contrary to the prohibition in s 5.
Decisions on the construction of s 5 of the CAA
The question whether, on its proper construction, s 5 of the CAA has displaced the court’s inherent jurisdiction to determine PP and PII claims made in the context of an arbitration does not appear to have been the subject of previous judicial consideration.
XY submits that the continued existence of the inherent jurisdiction of the court (as with all State Supreme Courts) to determine objections to the production of documents on the grounds of PP and PII was implicitly confirmed by the recent decision of Kourakis CJ in CPB Contractors Pty Ltd and Hansen Yuncken Pty Ltd v State of South Australia.[21]
[21][2024] SASC 46 (CPB Contractors).
In that case, the State objected to production in an arbitration of documents the subject of claims of PP and PII. That objection was challenged. At a hearing before the arbitrator, the State submitted that the arbitrator lacked jurisdiction to inspect the relevant documents and determine the PP and PII claims. Faced with that position, the party challenging the PP and PII claims did not prosecute its challenge in the arbitration but instead brought an application before the Supreme Court of South Australia for adjudication of those claims. Kourakis CJ proceeded to adjudicate upon and uphold the contested PP and PII claims, thereby plainly exercising jurisdiction to determine such claims.
The primary judgment in CPB Contractors did not expressly address the question of jurisdiction. However, in deciding the issue of costs,[22] Kourakis CJ accepted the correctness of a submission by the State that the questions of PP and PII were unable to be determined in the arbitral proceedings, such that the application to the court was, from the applicant’s perspective, necessary in order to ascertain whether the documents it sought to be disclosed ought to be disclosed. His Honour cited Seal Rocks in support of that conclusion.[23] It does not appear that the point which UV raises in this proceeding concerning the effect of s 5 of the CAA on the court’s inherent jurisdiction was raised or considered in CPB Contractors.
[22]CPB Contractors Pty Ltd and Hansen Yuncken Pty Ltd v State of South Australia (No 2) [2024] SASC 86.
[23]Ibid, [5].
The proper construction of s 5 of the Commercial Arbitration Act 2012 (WA), the Western Australian equivalent of the CAA, was considered at the intermediate appellate level in Hancock Prospecting Pty Ltd v DFD Rhodes Pty Ltd,[24] albeit in a context that was very different to the present application. The case involved disputed claims about the title to various mining tenements. A number of parties entered into a deed, one of the purposes of which was to provide for the resolution of such disputes by way of confidential arbitration. Not all parties who claimed interests in the tenements covered by the deed were parties to that deed. Two of the non-parties to the deed brought proceedings in the Supreme Court of Western Australia claiming interests in the tenements. Having been joined to the court proceeding, some of the deed parties brought counterclaims against other parties, including the other deed parties. An application was brought for a stay of the whole of the court proceeding or, alternatively, a stay of the counterclaims. At first instance the counterclaims by the deed parties against other deed parties were stayed, as were the counterclaims by the deed parties against non-deed parties. However, the application to stay the proceeding commenced by the non-deed parties was refused. That refusal was upheld on appeal.
[24](2020) 55 WAR 435 (Hancock Prospecting).
Although the context in which the operation of s 5 was considered in Hancock Prospecting is different to the present application, the analysis of Quinlan CJ (Beech and Vaughan JJA agreeing on the construction of s 5) has more general application. The Chief Justice began by noting (relevantly addressing the question raised for consideration in the context that case) that the purpose and effect of s 5 is not to prevent the courts from exercising their ordinary jurisdiction in relation to disputes between persons who are not parties to arbitration agreements, and that the fact that the resolution by a court of a dispute that is not a matter which is the subject of an arbitration agreement may have some practical or legal effect on a party to an arbitration agreement does not involve the court intervening in a matter that is subject to the Act.[25] His Honour than addressed the construction of s 5 in more general terms in the following passage:[26]
“299 Rather, in my view, s 5 is intended to reflect and give effect to the precept that, in relation to the involvement of courts in the conduct of arbitrations under the [CAA], from their establishment to their termination, the [CAA] is, in relation to matters governed by the [CAA], intended to be a code.
300 The use of the word ‘intervene’ in this context is significant. To ‘intervene’, in its natural meaning, means ‘to come between’, ‘to come in as something extraneous’. In the context of s 5, in my view, it refers to the court intervening in, that is ‘coming into’, the arbitral process itself otherwise than in accordance with the [CAA].
301 In that regard, the [CAA] confers upon the courts (and in particular the Supreme Court) a variety of powers and functions in relation to which the court may intervene in the arbitral process. They include matters such as the appointment of arbitrators, challenging arbitrators, termination of an arbitrator's mandate, recognition and enforcement of interim measures, assistance with taking evidence, determining questions of law, recourse against awards, and enforcement of awards. In relation to these matters, the Court may only intervene in the manner provided for in the [CAA].
302 More broadly, in my view, it is action of this kind that is contemplated by the term ‘intervene’ in s 5, ….
303 It will be immediately apparent that an aspect of my preferred construction is that the word ‘matters’ as it appears in s 5 (ie ‘matters governed by this Act’) is not to be equated with the use of the word ‘matter’ in s 8 (ie ‘matter which is the subject of an arbitration agreement’). … [T]he word ‘matter’ does not have the same meaning in the two provisions.
304 In this regard, it is important to recognise that there is no definition of the term ‘matter’ in the [CAA] and [sic, the] word is used in a variety of different ways throughout the Act.
305 At some points the use of the word ‘matter’ clearly designates a particular thing as previously referred to (eg s 11(5), s 16(6), s 16(9), s 24B(2)(a)) or is otherwise used in the sense of ‘thing’ (eg s 40(1)(e), s 41, s 42). There are a number of references to the ‘subject matter of the dispute’ (eg s 17(3)(d) to (f), s 34(2)(b)(i), s 36(b)(i) or ‘subject matter’ (s 25(3)(a)). At other times, the term is used in a sense that appears accordant with its usage in s 8(1) (eg s 34A(3)(d)).
306 In the particular context of s 5, in my view, the word ‘matters’ is used in the sense of ‘circumstances or things regulated by the Act’. This construction is borne out by its context in the phrase ‘matters governed by this Act’. The notion of a matter being ‘governed’ by the Act points to the kind of matters identified in [301] above.”
[25]Hancock Prospecting, 486 [297]-[298].
[26]Hancock Prospecting, 486-487 [299]-[306] (citations omitted).
This construction of s 5 was considered to be supported by commentary in the “Explanatory Note by the UNCITRAL secretariat on the [Model Law]” to which reference may be made in interpreting the CAA (see [48] above). That commentary included the following statements concerning Article 5 of the Model Law which was the basis for s 5 of the CAA:
“(b) Delimitation of court assistance and supervision
15. Recent amendments to arbitration laws reveal a trend in favour of limiting and clearly defining court involvement in international commercial arbitration. This is justified in view of the fact that the parties to an arbitration agreement make a conscious decision to exclude court jurisdiction and prefer the finality and expediency of the arbitral process.
16. In this spirit the Model Law envisages court involvement in the following instances. A first group comprises issues of appointment, challenge and termination of the mandate of an arbitrator (articles 11, 13 and 14), jurisdiction of the arbitral tribunal (article 16) and setting aside of the arbitral award (article 34). These instances are listed in article 6 as functions that should be entrusted, for the sake of centralization, specialization and efficiency, to a specially designated court or, with respect to articles 11, 13 and 14, possibly to another authority (for example, an arbitral institution or a chamber of commerce). A second group comprises issues of court assistance in taking evidence (article 27), recognition of the arbitration agreement, including its compatibility with court-ordered interim measures (articles 8 and 9), court-ordered interim measures (article 17 J), and recognition and enforcement of interim measures (articles 17H and 17 I) and of arbitral awards (articles 35 and 36).
17. Beyond the instances in these two groups, ‘no court shall intervene, in matters governed by this Law’. Article 5 thus guarantees that all instances of possible court intervention are found in the piece of legislation enacting the Model Law, except for matters not regulated by it (for example, consolidation of arbitral proceedings, contractual relationship between arbitrators and parties or arbitral institutions, or fixing of costs and fees, including deposits). Protecting the arbitral process from unpredictable or disruptive court interference is essential to parties who choose arbitration (in particular foreign parties).”
As Quinlan CJ observed,[27] this commentary:
“… supports a construction of Article 5 that is focused upon the arbitral process itself, and court ‘involvement’ or ‘interference’ in that process. The reference to the exclusion of court ‘jurisdiction’ in paragraph [15] of the note is clearly a reference to the contractual freedom of the parties to an arbitration agreement and their conscious decision to refer their dispute to arbitration.”
[27]Hancock Prospecting, 488 [309].
Quinlan CJ then considered and rejected submissions advanced by the appellants in Hancock Prospecting relying upon on the decision of Randerson J in the High Court of New Zealand in Carter Holt Harvey Ltd v Genesis Power Ltd.[28]After analysing the reasoning of Randerson J, the Chief Justice concluded as follows:[29]
“Carter Holt does not assist the appellants. On the contrary, it confirms my view that the purpose of s 5 is to confirm that where a particular matter, involving the courts, is dealt with in the Act (‘matters governed by this Act’), the court's powers are to be determined by, and only by, the provisions of the [CAA]. As Randerson J expressed it: the intention of s 5 is ‘where a particular topic or set of circumstances is governed by the [CAA], to exclude any general or residual powers given to the domestic court which are not specified in the [CAA].’”
[28][2006] 3 NZLR 794 (Carter Holt).
[29]Hancock Prospecting, 491 [322].
The analysis of s 5 in Hancock Prospecting supports UV’s submission about the existence of a parliamentary intention that the provisions of the CAA would operate as a code which prescribes the circumstances and the manner in which the court may intervene in the conduct of an arbitration conducted pursuant to those provisions. However, it is equally clear from this analysis that it is only matters that come within the phrase “matters governed by this Act” in s 5 which come within the scope of that code. If a matter falls outside that description, such that it is not regulated by the provisions of the Act, the prohibition on court intervention in s 5 will not apply. The critical issue in determining this application is whether the determination of PP and PII claims over documents sought to be produced in the arbitration is a matter governed by the CAA.
UV also relies on two Singaporean cases which considered the operation of s 5 of the Model Law.
The first case, L W Infrastructure Pte Ltd v Lim Chin San Contractors Pte Ltd,[30] concerned a challenge to an arbitral award made pursuant to Singapore’s domestic commercial arbitration legislation. Given that different context, UV only relies on this decision to the extent that it includes statements of general principle on the operation of Article 5 of the Model Law. As to this, the Singaporean Court of Appeal stated:[31]
“36 The effect of art 5 of the Model Law is to confine the power of the Court to intervene in an arbitration to those instances which are provided for in the Model Law and to ‘exclude any general or residual powers’ arising from sources other than the Model Law …. The raison d’être of art 5 of the Model Law is not to promote hostility towards judicial intervention but to ‘satisfy the need for certainty as to when court action is permissible’.
…
38 In our view, having regard to the need for a broadly consistent approach to the interpretation of the Act and the Model Law, s 47 of the Act should be construed in a manner that is consistent with the intent underlying art 5 of the Model Law. Section 47 of the Act states that the Court shall not have jurisdiction to interfere with an arbitral award except where so provided in the Act. The certainty which is sought to be achieved by this provision would be significantly undermined if the courts retained a concurrent ‘supervisory jurisdiction’ over arbitral proceedings or awards that could be exercised by the grant of declaratory orders not expressly provided for in the Act.
39 In short, in situations expressly regulated by the Act, the courts should only intervene where so provided in the Act.”
[30][2013] 1 SLR 125.
[31]Ibid, 136 [36], [38] and [39].
In my view, the analysis in that passage accords with that of Quinlan CJ in Hancock Prospecting. The focus of the inquiry is upon whether relief has been sought from the court in respect of a matter that is governed by the CAA.
A slightly different view was expressed in second case UV relies upon, Republic of India v Vedanta Resources plc.[32] That concerned two separate but related arbitrations arising from tax assessment orders issued by the appellant. Due to a concern about the risk of inconsistent findings by the two arbitral tribunals, the appellant sought a regime to permit cross-disclosure of documents between the two arbitrations. Dissatisfied with the orders made in the Vedanta arbitration, the appellant brought proceedings in the High Court of Singapore (Singapore being the seat of the arbitrations) seeking declarations that documents disclosed or generated in the Vedanta arbitration were not private or confidential and that disclosure of those documents in the related arbitration would not be in any breach of confidentiality or privacy. That relief was refused at first instance and the refusal was upheld on appeal.
[32][2021] 2 SLR 354 (Vedanta Resources).
On the appeal, the appellant acknowledged the words of Article 5 of the Model Law but argued that, in circumstances where neither the Singaporean version of the IAA nor the Model Law made any provision for confidentiality, the implied obligation of confidentiality applied as a substantive rule of the common law of Singapore such that confidentiality was not a matter “governed by this Law” within the meaning of Article 5 of the Model Law. On that basis, the Singapore courts had the power to issue the declaratory relief sought by the appellant.
In rejecting that argument, the Singaporean Court of Appeal stated:[33]
“In our judgment, it was incorrect to frame the issue as whether confidentiality was governed by the Model Law. This overlooked the broader purpose of the question of confidentiality and the context in which it was being considered. Here, confidentiality was not relevant as a discrete and standalone issue nor was it being considered in the abstract. Rather, it was an integral and anterior question which served to guide the determination of the extent to which the Vedanta Tribunal should order the cross-disclosure of documents. On this view, the issue in VPO 3 was a procedural one – it concerned disclosure and/or discovery of the documents disclosed or generated in the Vedanta Arbitration – and it is trite that an arbitrator is ‘master of his own procedure’ …. The fact that the obligation of confidentiality applied as a substantive rule of the common law … did not take it outside the scope of the arbitral procedure and place it within the purview of the court.”
[33]Vedanta Resources, 367 [29] (citations omitted, italics in original).
The Singaporean Court of Appeal concluded that there was no legal basis to invoke the jurisdiction of the court to ask for declaratory relief.[34]
[34]Vedanta Resources, 369 [34].
To the extent that the Singaporean Court of Appeal’s criticism about the framing of the issue – being whether the subject of the relief sought from the court was governed by (for present purposes) the CAA – involves a departure from the construction of s 5 adopted in Hancock Prospecting I would not follow it. As Hancock Prospecting is a decision of an intermediate appellate court applying sections of uniform commercial arbitration legislation in force in each State, I consider that I should adopt the construction of s 5 set out in that decision.[35]
[35]Transurban WGT Co Pty Ltd v CPB Contractors Pty Ltd [2020] VSC 476, [147].
Conclusion on the question of the displacement of the court’s jurisdiction
With some hesitation, I have ultimately concluded that s 5 has not displaced the court’s inherent jurisdiction to determine XY’s claims of PP and PII, notwithstanding the fact that those claims have been raised as the basis for objecting to the production of documents in the arbitration.
This follows from the construction of s 5 adopted in Hancock Prospecting. It seems clear from the passages extracted above, and particularly the statements in paragraphs [301], [306] and [322] of that decision, that although the prohibition in s 5 can operate to exclude any general or residual power given to the court which is not specified in the CAA (which would include the inherent power the subject of the present application), that prohibition only applies to functions which are conferred on the court by the CAA.
Contrary to UV’s submission at [52] above, on this construction, the absence of any statutory mechanism under the CAA that confers upon the court the function of determining the PP and PII claims made by XY in the arbitration means that such determination by the court is not a matter that is governed by the CAA within the meaning of s 5. Accordingly, the prohibition against the court intervening except in accordance with the provisions of the CAA does not apply to the determination of the PP and PII claims. The court’s inherent jurisdiction to determine those claims has not been displaced.
Although the decision in Seal Rocks did not involve consideration of a provision equivalent to s 5 of the CAA, the observations made by Ormiston JA about the different character of the right to claim PP and PII remain relevant and, in my view, support the conclusion I have reached.
The parliamentary intention to establish a code governing the scope of the court’s intervention in arbitrations conducted under the provisions of the CAA was given effect by the enactment of provisions which specify those functions of the court which are the subject of that code. Again, the determination of PP or PII claims which are raised as a basis for resisting the production of documents in an arbitration is not a function which has been conferred on the court by the provisions of the CAA.
In those circumstances, I am not ultimately satisfied that the prohibition in s 5, properly construed, has expressly or by necessary implication displaced the inherent jurisdiction of the court to determine the PP and PII claims made by XY.
Discretionary considerations
Having rejected UV’s primary submission, it remains to consider the alternative argument that XY should be refused the relief it seeks on discretionary grounds.
UV submits that relief should be refused in circumstances where XY has not challenged the Arbitrator’s determination that he has jurisdiction to determine the PP and PII claims; nor has it sought to injunct the Arbitrator from exercising that jurisdiction. UV emphasises that, having regard to his former position as a Judge of the Supreme Court of Western Australia, the Arbitrator is eminently qualified to determine the PP and PII claims. Further, the Arbitrator is familiar with the issues in the arbitration and well placed to carry out the balancing exercise necessary to adjudicate on the PP and PII claims.
Although not directly addressing UV’s alternative argument, the tenor of XY’s submissions is that if the court’s inherent jurisdiction to decide PP and PII claims has not been displaced by s 5 of the CAA then it must necessarily follow that the court would exercise that jurisdiction rather than leaving it to the Arbitrator to rule on the claims. I acknowledge and accept the importance of the right to claim PP and PII and of the considerations of high public policy such claims raise in the context of the operation of the body politic. I also acknowledge the importance of a party’s right, in the ordinary course, to have such claims determined by the court.
Nevertheless, the relief XY seeks is discretionary and the question whether it is appropriate to exercise that discretion in XY’s favour must be considered by reference to the circumstances of this case. The circumstances which bear upon the exercise of that discretion include the context in which XY has raised the PP and PII claims and the nature and timing of its application for relief from the court.
As discussed above, XY raised its claims of PP and PII as a basis for resisting the production of documents sought in the arbitration. It did so in circumstances where the Arbitrator has made procedural orders to progress the arbitral proceeding towards an evidentiary hearing presently scheduled for February 2025. Accordingly, the duties imposed by the CAA on the parties to the arbitration (but relevantly here, XY) form part of the context which informs the exercise of the discretion. The duty to do all things necessary for the proper and expeditious conduct of the arbitral proceedings (s 24B(1)) and the duty to comply without undue delay with any order or direction of the arbitral tribunal with respect to any procedural, evidentiary or other matter (s 24B(2)(a)) have particular significance in that context. In considering whether to exercise the discretion to grant XY the relief it seeks, its approach to the determination of the PP and PII claims should be assessed by reference to those duties.
The course of the arbitration has been set out above. Relevantly for present purposes, XY complied with the decision of the Arbitrator of 26 June 2024 to produce documents in the arbitration, subject to its claims of PP and PII. By doing so, it raised the issue of the validity of those claims in the arbitral proceeding. XY must have been aware by no later than 13 September 2024 that UV was challenging the objections to the production of documents on the grounds of PP and PII. With that knowledge, XY appeared at the hearing before the Arbitrator on 4 October 2024 and argued that the Arbitrator did not have jurisdiction to rule on the claims of PP and PII. As already discussed, after it failed on that argument XY did not seek a decision from the court on the Arbitrator’s jurisdiction under s 16(9) of the CAA. Instead, it brought this proceeding seeking relief which, if granted, will have the practical effect of preventing the Arbitrator from exercising the jurisdiction, which he has found he possesses and is appropriate for him to exercise in the circumstances, to rule on the PP and PII claims.
In effect, XY’s position now in resisting the production of documents the subject of the claims of PP and PII to the Arbitrator is that such documents should be excluded from the arbitration altogether, including for the purposes of ruling on the claims of PP and PII. To my mind, if that was the position XY wished to take, it was incumbent on it (bearing in mind its duties under the CAA) to bring this application at an earlier stage. If XY wished to resist production to the Arbitrator, the more appropriate course would have been to bring this application seeking relief from the court before the question of jurisdiction to rule on the PP and PII claims was argued before the Arbitrator and decided by him.
This is not to suggest that, by the approach it has taken to the determination of the PP and PII claims, XY has waived its right to seek a determination of those claims by the court. Nevertheless, the result of that approach is that both the arbitration, and consideration of whether the PP and PII claims can and should be determined by the Arbitrator in the arbitration, have now progressed to the point that granting the relief XY seeks and thereby preventing the Arbitrator from determining those claims would carry the risk of unduly delaying the further progression of the arbitration. That is a factor which weighs against the grant of relief in the circumstances of this case.
Against this, I take account of the potential impairment of XY’s claim to PP and PII if the documents subject to objection are inspected by the Arbitrator or an expert appointed pursuant to s 26 of the CAA for the purpose of ruling on the claims. As UV submits, the process of ruling on the claims would not necessarily require the Arbitrator or an expert to inspect the documents. Nevertheless, the possibility of inspection exists. Even if that possibility were to come to fruition, given the qualifications and experience of the Arbitrator and any expert appointed under s 26 of the CAA and the confidential nature of the arbitral proceedings, it is difficult to see how a determination of the claims in the Arbitration would involve an intrusion upon, or impairment of, the claims of PP and PII that would be significantly different to that involved in a determination by the court.
On balance, and again not without hesitation, I have concluded that in this case the discretion should be exercised against granting the relief XY seeks. In the circumstances I have described and given the stage that the arbitration, and particularly the agitation of the PP and PII claims in the arbitration, has reached it is appropriate to leave those claims to be determined by the Arbitrator.
On that basis the originating application will be dismissed.
Confidentiality
At the commencement of the hearing, I made orders on an interim basis for the sealing of documents filed in the proceeding. Given the private and confidential nature of the arbitration itself I was satisfied it was in the public interest and the interests of justice to prevent information concerning the arbitration from being disclosed other than to the court in the circumstances of this application[36] and that interest significantly outweighs the public interest in open justice.[37]
[36]Re Samgris Resources Pty Ltd (in liq) [2022] QSC 126, [77].
[37]Hancock v Hancock Prospecting Pty Ltd (2022) 402 ALR 328, 343 [62].
UV made further submissions as to confidentiality by which it sought to have these reasons published subject to confidentiality orders for a short period (such as seven days) to allow the parties an opportunity to make submissions as to whether any parts of the reasons should be redacted in the copy of the reasons made available publicly and, otherwise, give the parties an opportunity after the reasons are published to make submissions as to the final form of any confidentiality orders that should be made over the evidence, submissions and transcript of this proceeding.
The approach suggested by UV was followed by Ball J in Hancock v Hancock Prospecting Pty Ltd.[38] I am satisfied that it is also appropriate to adopt that approach in this case.
[38]Ibid.
Orders
The orders will be:
1. The originating application filed on 18 October 2024 is dismissed.
2. Within seven days of the date of this judgment the parties are to bring in short minutes of order recording the terms of a suppression order to be made by the Court in respect of material placed before the Court, and any transcript produced, in connection with this proceeding.
3. Until 4.00pm on 8 November 2024 or further order, this judgment and its contents are not to be disclosed, by publication or otherwise, to any person other than (a) the parties and their legal representatives; and (b) the Arbitrator.
4. I will hear the parties as to costs.
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