The Victorian Court of Appeal in Imagebuild Group Pty Ltd v Fokust Pty Ltd [2017] VSCA 131 has held that an affidavit alleged to be an affidavit supporting an application to set aside a creditor’s statutory demand under s 459G of the Corporations Act 2001 (Cth) was not a supporting affidavit but merely one explaining delay in the swearing, filing and serving of what was to be the supporting affidavit.

Section 459G of the Corporations Act requires that a supporting affidavit be filed and served within 21 days after the statutory demand is served. The affidavit in question had been sworn by the practice manager of the solicitors’ firm acting on behalf of the company seeking to set aside the statutory demand.  The affidavit was sworn, filed and served on the last day of the 21 day time period. It:

• referred to the service of the statutory demand on the company;
• stated that the solicitors had prepared the originating process and the supporting affidavit of a named deponent who was a director of the company, to accompany the application to set aside the statutory demand;
• said that the originating process and a true copy of the supporting affidavit (unsworn) would be filed with the Supreme Court that day and that the deponent was not available to attend at the solicitors’ offices on that day because he was working in the country and, due to computer issues, would not be able to send a sworn copy until a date which was 3 days later; and
• exhibited what was described as “a copy of the unsworn supporting affidavit” of the deponent and said that it was expected that the original sworn affidavit of the deponent in support of the company’s application would be filed on that later date.

The exhibited supporting affidavit (unsworn) addressed issues which were said to reduce the amount being sought by the creditor and exhibited a draft writ which made certain claims as against the creditor.

The Victorian Court of Appeal was constituted by two judges of appeal. Whelan JA (with whom Almond AJA agreed) made the following points (at [19]-[25]).

• The affidavit in question was not an affidavit supporting the application to set aside the statutory demand. Rather, it was an affidavit explaining the delay in the swearing, filing and service of what was to be the supporting affidavit.
• The High Court had held in David Grant & Co Pty Limited v Westpac Banking Corporation [1995] HCA 43; (1995) 184 CLR 265 that the requirement that a supporting affidavit be filed and served within the specified 21 day period defined the jurisdiction of the Court under s 459G.
• The High Court had also held in Aussie Vic Plant Hire Pty Ltd v Esanda Finance Corp Ltd [2008] HCA 9; (2008) 232 CLR 314 that there was no power to extend time after the 21 day period had elapsed.
• An affidavit filed and served within the specified time which asserted that a supporting affidavit would be sworn, or may be sworn, but not within time, and which explained the delay, was not itself a supporting affidavit.
• There could be cases where an affidavit directed at explaining delay could nevertheless be sufficient to constitute a supporting affidavit, for example, where the affidavit verified, on the basis of instructions or otherwise, the contents of the affidavit which was proposed to be sworn. The affidavit in question, however, did not purport to do this. It did no more than foreshadow what the practice manager expected would be sworn and explained why that had not been done within the 21 day time period.
• The fact that the foreshadowed as yet unsworn affidavit, if it had been sworn and served within the 21 day time period, could have been sufficient to constitute a supporting affidavit was not to the point.
• If an affidavit of the nature of the affidavit in question was held to be sufficient, it would be tantamount to permitting extensions of the 21 day time period which the High Court had made clear was not permitted.

Other cases

For some other cases which deal with the requirements of the supporting affidavit under s 459G, see the following on this website:

• “Whether there is a ‘genuine dispute’ for the purposes of s 459H(1)(a) – relevant principles”, 2 December 2016.
• “Graywinter principle found to preclude reliance upon a ground first raised after the 21 day period”, 24 February 2016.
• “The Graywinter principle – quantification of an offsetting claim is not necessary”, 2 December 2014.

See also K Ottesen, “Setting aside a statutory demand – an update on Graywinter” (2013) BCLB [455].

Introduction

The Supreme Court of New South Wales in Boorman v Glaxo Wellcome Australia Pty Ltd [2017] NSWSC 576 has ordered a firm of solicitors to pay to their clients costs which the clients were ordered to pay to an opposing party because the clients had unreasonably resisted inspection of subpoenaed documents on the solicitors’ advice.

Background

The clients were New South Wales and Queensland plaintiffs in separate but related proceedings brought against a pharmaceuticals manufacturing company for damages in tort. Each plaintiff had, on various dates in the 1970s and 1980s, undergone a myelogram to obtain images of the spine and parts of the nervous system. Each plaintiff alleged that he or she had been given an injection into the spinal column of Myodil, an oil-based contrast medium manufactured by the defendant, and that the Myodil had caused a condition known as adhesive arachnoiditis which had resulted in the nerves clumping together and causing symptoms which included severe pain in the lumbar spine and lower limbs.

As against each plaintiff, the defendant pleaded that the claim was statute-barred. Court orders were made in each proceeding that the defendant’s limitation of actions defence be heard separately from and determined in advance of all other questions in the proceedings and that each plaintiff should file a reply and statements of evidence with respect to the limitation defence. Replies and witness statements were subsequently filed.

A subpoena was issued to the plaintiffs’ solicitors directed to obtaining evidence of the dates at which the plaintiffs had gained knowledge that they may have had a cause of action against the defendant. The subpoena required production of all documents comprising or evidencing communications (including memoranda of advice) made on or before a specified date between the solicitors and any barrister briefed by the solicitors on behalf of the plaintiffs, and relating or referring to the proposed or possible commencement by one or more plaintiffs of legal proceedings for damages for injury as a result of being injected with Myodil.

The plaintiffs’ solicitors resisted producing for inspection many of the documents, claiming that they were subject to client legal privilege. Finally, almost a year after the subpoena was returnable, and some eight months after the defendant had filed a notice of motion seeking access, the plaintiffs agreed to allow inspection of the disputed documents.

The remaining issue was the question of costs. The defendant sought an order that the plaintiffs pay its costs of having had to litigate for access to the documents. It also sought orders that, under s 99 of the Civil Procedure Act 2005 (NSW) which imposes liability on legal practitioners for unnecessary costs, the plaintiffs’ solicitors pay to the plaintiffs the costs ordered against the plaintiffs.

Decision

The costs application was dealt with by Fagan J.

Had there been an “issue waiver” of client legal privilege?

His Honour approached the matter by first deciding whether the New South Wales plaintiffs had waived client legal privilege by acting in a way that was inconsistent with maintaining an objection to production of the subpoenaed documents for inspection under ss 122(2) and 131A(1) of the Evidence Act 1995 (NSW).

His Honour examined the New South Wales plaintiffs’ replies in which they sought an order for extension of the limitation period for their respective causes of action under the Limitation Act 1969 (NSW). His Honour also examined the New South Wales plaintiffs’ replies and witness statements which set out the knowledge which they claimed to have had of the existence of a cause of action against the defendant. His Honour then set out (at [35]-[40]) the principles of “issue waiver” of client legal privilege and, having regard to those principles, concluded that the New South Wales plaintiffs’ conduct was inconsistent with the maintenance of client legal privilege. The key points made by his Honour (at [41]-[43]) were as follows:

• The plaintiffs were prosecuting claims for extension of time which involved positive assertions that they had not acquired knowledge of matters essential to their respective causes of action over protracted intervals during which they were under legal advice with respect to those very causes of action. This was a clear case of issue waiver.
• It would be obviously unfair for the plaintiffs to rely upon their witness statements, which were silent as to any advice from their solicitors and as to any instructions provided to the solicitors over the relevant intervals, while preventing the defendant from inspecting documents which had come into existence during those times and would evidence or constitute communications which could contradict the impression conveyed by the witness statements. Accordingly, the plaintiffs’ advancement of their claims for extension of time was inconsistent with their objection to produce for inspection the otherwise privileged documents caught by the subpoena.
• In opposing access to the subpoenaed documents, the plaintiffs had relied upon the ‘abject silence’ of their witness statements with respect to any solicitor-client communications during the period critical to their state of knowledge about causes of action and had asserted that such ‘abject silence’ could not constitute implied waiver of privilege. However, this submission involved a misconception of the law relating to issue waiver because the conduct inconsistent with maintaining the privilege was the advancing, by pleading and by a claim for relief, of a case which depended upon the proposition that relevant knowledge was not acquired through communications with solicitors. The position would have been the same if no witness statements had been served.

As regards the Queensland plaintiffs, after examining the pleadings and witness statements of those plaintiffs in the light of the relevant Queensland limitation of actions legislation and the common law which governed the Queensland plaintiffs’ production of the subpoenaed documents for inspection, his Honour said (at [49]) that his findings regarding issue waiver by the New South Wales plaintiffs and concerning their conduct inconsistent with the maintenance of client legal privilege were equally applicable to the Queensland plaintiffs.

Accordingly, his Honour found that the plaintiffs were not justified in resisting production of the documents for inspection and that they should be ordered to pay the defendant’s costs of and incidental to the notice of motion for access.

Was the plaintiffs’ resistance without reasonable cause in circumstances where the solicitors were responsible?

Fagan J then had to decide whether the plaintiffs’ solicitors should be ordered to pay to the plaintiffs the costs which the plaintiffs were ordered to pay to the defendant. This decision depended upon whether the plaintiffs’ resistance to production of the subpoenaed documents and the resulting incurrence of costs by the defendant in prosecuting its notice of motion had occurred “without reasonable cause, in circumstances for which a legal practitioner is responsible” as provided by s 99(1)(b) of the Civil Procedure Act. His Honour (at [51]-[54]) said as follows:

• The plaintiffs as laymen would not have known whether production of the documents could be resisted and so their stance in opposition to the defendant’s notice of motion must have been taken upon the advice of their solicitors.
• While the effect of the implied waiver was not universal so as to open up the files of the solicitors without regard to any demonstration of connection of their content with the factual issues raised by the proceedings, the plaintiffs had based themselves upon a misconception about the effect of their witness statements being silent with respect to solicitor-client communications and so had substantially refused any production for nearly a year after the subpoena was returnable and eight months after the defendant had filed its notice of motion for access. They had not merely sought to oppose the defendant’s access to solicitor-client communications which were irrelevant or peripheral to the issues raised by their extension of time applications.
• Examples of the documents in respect of which access had been resisted had been tendered on the hearing of the costs argument and it was readily apparent that these documents had a significant bearing upon the knowledge which each plaintiff acquired of the existence of a cause of action against the defendant, prior to dates which were critical to their claims for extension of time. It should have been clear to the plaintiffs’ solicitors that it would be unfair for the plaintiffs to rely upon their witness statements, which implicitly conveyed the impression that no material communication with their solicitors advanced their knowledge of their causes of action, while withholding such documents, and that the issues raised by the plaintiffs’ replies could not fairly be litigated while access to these documents was denied. By the standard of the reasonably competent solicitor, the plaintiffs’ solicitors should have been aware that their clients had acted in the litigation inconsistently with maintaining client legal privilege over, at least, the significant number of documents tendered by way of example and that the defendant’s notice of motion for access should not have been opposed.

Accordingly, his Honour ordered that the plaintiffs’ solicitors pay to the plaintiffs the entirety of the costs which the plaintiffs were required to pay to the defendant.

Introduction

The Federal Court of Australia in Armstrong Scalisi Holdings Pty Ltd v Piscopo (Trustee), in the matter of Collins [2017] FCA 423 has criticised an estimate given in a security for costs application which was based on numerous solicitors performing work ordinarily performed by counsel. Rares J said that it was time that the legal profession recognised that costs should be kept to a minimum and that having multiple lawyers involved in, for example, the drafting of a pleading or submissions, evidenced a failure to address a client’s best interests and the overarching purpose in Pt VB of the Federal Court of Australia Act 1976 (Cth) to minimise costs, and involved a degree of waste and unnecessary duplication of effort.

Background

The security for costs application was brought by the trustee of certain bankrupt estates against a company which had commenced proceedings seeking relief against the bankrupts’ estates in respect of property which had been registered in the bankrupts’ names immediately before they filed debtors’ petitions. Rares J was satisfied, in the circumstances of the case, that the company should provide security for costs but expressed concerns about the estimate given of the total costs and the amount of security sought.

The trustee’s solicitor had estimated that the trustee’s costs and disbursements in defending the claim would be approximately $239,485 exclusive of GST, and was seeking security in the sum of $143,691, exclusive of GST, which was 60% of the estimated total costs. The estimates were based on work being carried out by four solicitors of varying seniority, and by counsel. The hourly rates of the solicitors, with the exception of the most junior solicitor, were higher than counsel’s hourly rate. The estimates included:

• $21,920 for considering the statement of claim and drafting and settling the defence and any cross-claim, which included counsel’s fees of $6400; and
• $66,960 for preparation and conduct of an estimated two day final hearing, which included counsel’s fees of $16,000.

Concerns raised

The key points made by Rares J (at [17]; [20]-[28]) were as follows:

• The total estimate and the amount of security sought appeared to be very large and to involve the participation of a large number of solicitors in performing work at rates far greater than counsel’s rates for tasks that appeared, primarily, to be the responsibility of counsel.
• This division of work and costs:
  • did not comply with the requirements of Pt VB of the Federal Court of Australia Act and the overarching purpose of the civil practice and procedure provisions (to facilitate the just resolution of disputes as quickly, inexpensively and efficiently as possible); and
  • reflected an inefficient and inappropriate way of dealing with the preparation for, and conduct of the hearing of, the case.
• The case was one that should be substantively prepared and argued by counsel whose fees were less on an hourly basis than all of the solicitors’ fees, apart from the fees of the junior solicitor, and who should have the primary role in preparing and drafting the pleadings and submissions, after having received instructions about the facts, rather than having pleadings, or submissions, drafted by four solicitors.
• One of the significant concerns in Australia was the cost of access to justice, and individuals and small businesses would find it difficult to obtain access to justice when four solicitors at the one firm were each charging different, but substantial, amounts for doing what was essentially repetitive work of looking at one another’s drafts, documents or other communications, all of which, ultimately, would be (and should properly be) drafted and settled by counsel. There was no obvious reason why this kind of charging practice was appropriate, having regard to the solicitors’ fiduciary duties to their clients to ensure that cases were prepared as efficiently and as economically and reasonably as possible.
• This was not an isolated case but appeared to be part of a more general model where solicitors did work which was originally intended to be done by the separate bar of specialised and most cost-efficient advocates, namely, counsel. Thus, in security for costs applications, amounts estimated to be incurred by solicitors in preparing cases, as opposed to the amounts estimated to be incurred by counsel, too often involved a skewing of work towards the solicitors’ efforts that appeared not to be efficient or appropriate.
• Where counsel had to make the forensic decisions as to how the material facts should be pleaded, what pleadings were maintainable, what evidence should be led and what submissions should be drafted, it was vitally important that counsel undertake the burden of doing that work themselves and not have it duplicated unnecessarily. Furthermore, where solicitors did significant amounts of drafting work, it became much more difficult for counsel to delete material which counsel considered to be forensically useless because the solicitor’s client would have been charged for that material and resulted in counsel, at the hearing, often departing significantly from the written submissions that had been ordered to be filed. This was not the way that litigation should be conducted, having regard to the solicitors’ and counsel’s fiduciary duties to their client, their obligations to the Court and their client under Pt VB of the Federal Court of Australia Act and their ethical obligations arising from their being officers of the Court.
• Litigation should be conducted as quickly, inexpensively and as efficiently as possible, with the substantive work necessary to draft pleadings, and present evidence and argument in proceedings being essentially that of the advocate who appeared at the hearing. However, that was not how larger law firms tended to approach modern litigation.
• It was time that the profession recognised that costs should be kept to a minimum. Having five lawyers looking at, for example, the drafting of a pleading or submissions evidenced a failure to address a client’s best interests and the overarching purpose in Pt VB of the Federal Court of Australia Act to minimise costs, and involved a degree of waste and unnecessary duplication of effort.

His Honour noted (at [29]) that, after he had raised his concerns about the estimates, the trustee’s counsel had suggested a modification which accepted that most of the work would be performed by one solicitor and counsel (a suggestion which his Honour considered appropriate) and which resulted in a significant reduction of the amounts estimated.

In the result, his Honour concluded that the appropriate amount to be ordered by way of security was a total of $77,000 (about half of the original estimate), to be paid in stages.

Concerns not new

The concerns expressed above are not new. Similar concerns have been expressed by a number of other judges over the years. For a consideration of what some of those other judges have said about the costs benefits of the efficient division of work between solicitors and barristers, and the solicitors’ responsibilities which flow from this, see K Ottesen, “Costs of civil litigation: The solicitor’s duty to ensure that work is done at the lower cost”, 1 July 2014.

Introduction

The Federal Court of Australia in Australian Securities and Investments Commission, in the matter of NSG Services Pty Ltd v NSG Services Pty Ltd [2017] FCA 345 has found a financial services licensee liable for breaches of the Future of Financial Advice (FOFA) reforms. The breaches were admitted by the financial services licensee and the Court made declarations substantially in terms which had been agreed between the parties. There being no agreement between the parties on the penalty, orders were made by consent with a view to a hearing taking place at a later time on the penalty.

Relevant provisions

The FOFA reforms are contained in Pt 7.7A of the Corporations Act 2001 (Cth) (“Act”) which relevantly includes, in Div 2, the following provisions:

• s 961B(1): This imposes a ‘best interests’ duty on providers in respect of personal financial advice provided to retail clients.
• s 961B(2): This provides a ‘safe harbour’ for complying with the best interests duty. If the provider can prove that the provider has taken each of the seven steps in s 961B(2), the provider will have satisfied the best interests duty.
• s 961G: This imposes an ‘appropriate advice’ duty on providers. The advice that is provided must be appropriate to the retail client, had the provider satisfied the best interests duty.
• s 961K(2): This provides that a financial services licensee contravenes s 961K if a representative (other than an authorised representative) of the licensee contravenes certain provisions (including ss 961B and 961G) and the licensee is a responsible licensee in relation to that contravention.
• s 961L: This provides that a financial services licensee must take reasonable steps to ensure that its representatives comply with, amongst certain other provisions, ss 961B and 961G.

Background

The financial services licensee in question (“Licensee”) carried on business as a provider of financial services and held an Australian Financial Services Licence which permitted it, inter alia, to advise retail clients about and deal in life risk insurance and superannuation products. The Licensee employed and contracted persons to provide financial services advice on its behalf as authorised representatives and as representatives other than authorised representatives.

ASIC sought declarations and pecuniary penalties against the Licensee. It alleged that on several occasions, certain of the Licensee’s authorised representatives and representatives other than authorised representatives (collectively “Licensee Representatives”) had failed to comply with ss 961B and 961G in relation to personal advice provided to the Licensee’s retail clients and that the Licensee had contravened:

• s 961K(2) in respect of the breaches by those Licensee Representatives who were not authorised representatives; and
• s 961L because the Licensee had failed to take reasonable steps to ensure that the Licensee Representatives complied with ss 961B and 961G.

The Licensee admitted that it had contravened the relevant provisions and the parties put forward an Agreed Statement of Facts (a copy of which was annexed to the judgment) and agreed minutes of orders for proposed declaratory relief. The parties, however, were not agreed with respect to the pecuniary penalties sought by ASIC.

Court’s decision

The matter was heard by Moshinsky J who made declarations substantially in the terms sought by the parties and made orders by consent with a view to a hearing taking place at a later time on the penalty.

Observations on the relevant provisions

Some of the observations made by his Honour on the relevant provisions in Div 2 of Pt 7.7A included the following:

• There was some difference in emphasis between the parties as to the interaction between s 961B(1) and s 961B(2). While ASIC accepted (as submitted by the Licensee) that a person might be able to satisfy the best interests duty in s 961B(1) even though they did not fall within the ‘safe harbour’ of s 961B(2), ASIC contended that, as a matter of practicality, s 961B(2) probably covered all the ways of showing that a person had complied with s 961B(1) and that a failure to satisfy one or more of the steps in s 961B(2) was highly relevant to the Court’s assessment of whether there had been compliance with the best interests duty (at [18]).
• It was common ground that, while s 961B was concerned with the process or procedure involved in providing advice that was in the best interests of the client, s 961G was concerned with the content or substance of that advice. While, at first blush, the text of s 961B did not appear to support this way of viewing s 961B, support for this view was provided by the context in which s 961B appeared, including the language of s 961G, the legislative history, and the legislative materials. However, it was not necessary to reach a concluded view on this issue (at [21]).
• The parties differed to some degree as to the requirements necessary to establish a contravention of s 961L. ASIC submitted in its written submissions that the Licensee’s liability under s 961L arose by reason of the Licensee Representatives’ contraventions of ss 961B and 961G, a failure by the Licensee to take reasonable steps to prevent those contraventions, and a causal nexus between the two. The Licensee, however, submitted that s 961L required consideration only of the reasonableness of the Licensee’s conduct (i.e. the steps taken by it) and that it was not necessary or sufficient to show a contravention of another relevant provision such as s 961B or s 961G. In oral submissions, ASIC did not advocate a firm position on the issue, but considered, as a matter of practicality, that some form of causal nexus was likely to exist in most cases. It was not necessary to resolve this issue as the agreed facts established the underlying contraventions of ss 961B and 961G by the Licensee Representatives and also demonstrated a causal relationship between the Licensee’s failure to take reasonable steps and the contraventions of ss 961B and 961G by the Licensee Representatives (at [36]-[39]).

Contraventions of s 961L

The following practices and policies of which the Licensee was aware were found to demonstrate the Licensee’s failure to take reasonable steps to ensure compliance by the Licensee Representatives with their best interests duty and appropriate advice duty. Accordingly, the Licensee had contravened s 961L (see [40]-[74]):

(a) The new client advice process involved most client instructions being provided at the only meeting which took place between the client and the Licensee Representative, with advice being given to the client and the client agreeing to implement the advice at that same meeting. Clients signed incomplete forms and documents which were often completed by the Licensee Representative after the meeting and in the absence of the client. Statements of Advice (“SOA”) were prepared after the provision and implementation of the advice. This meant that the Licensee Representatives gave financial product advice:

• in the absence of proper, sufficient and complete instructions and information about the client’s objectives, financial situation and needs;
• without conducting research into appropriate financial products after the provision of complete instructions by the client;
• without comparing the client’s existing superannuation and life and risk insurance products with the client’s stated objectives, and with the products recommended by the Licensee; and
• prior to the preparation of a written SOA or the client receiving, and considering, the matters in a SOA.

(b)There was inadequate training given to the Licensee Representatives about their individual obligations under the Act which meant that they were not adequately made aware of their personal responsibility for compliance with the best interests duty, the appropriate advice duty, or of the legal consequences of non-compliance.

(c) There was an inadequate system for monitoring and supervision because the Licensee did not conduct regular or substantive performance reviews of the Licensee Representatives, and did not conduct regular internal audits of the advice provided by the Licensee Representatives, or check that advice was provided in compliance with the obligations in Div 2 of Pt 7.7A. In some cases, internal audits had revealed non-compliance but the Licensee Representative was not adequately sanctioned and the Licensee did not interrogate its systems, policies and practices to determine if there were deficiencies in the processes that enabled advisers to avoid compliance with their regulatory obligations.

(d) Although a number of external audits had identified various unsatisfactory acts and omissions of Licensee Representatives in providing advice, and potential breaches of the Licensee’s and Licensee Representatives’ obligations under the Act and provided detailed advice about what should be done, the Licensee had failed adequately to follow or implement that advice.

(e) The Licensee did not have adequate compliance policies. It did not have any policy which addressed the Licensee Representatives’ statutory duties and requirements under Div 2 of Pt 7.7A, or any other provisions, of the Act. While it had a number of written policies relating to legal and regulatory compliance and risk management, the policies were inadequate and, in many cases, not followed or enforced by the Licensee. The Licensee maintained a register for recording breaches by its representatives of their own and the Licensee’s statutory obligations, but regularly failed to record instances of conduct that might have constituted a breach. The Licensee also maintained a complaints register for recording complaints by clients against representatives but this did not record all complaints and, the complaints which were recorded, demonstrated conduct by the Licensee Representatives that was consistent with the findings of the external auditors.

(f) Some Licensee Representatives were paid only by way of commission which created an incentive for them to emphasise sales imperatives over compliance requirements and a culture in which the best interests and appropriate advice duties were more likely to be overlooked.

Contraventions of s 961K(2)

Moshinsky J said that liability under s 961K(2) was automatically imposed on the Licensee by reason of its Licensee Representatives, other than authorised representatives, having contravened ss 961B and 961G. The Licensee Representatives in question were employees of the Licensee. Accordingly, the Licensee was found to have contravened s 961K(2) (at [32]-[34]).

Two justices of the New South Wales Court of Appeal in Fairall v Hobbs [2017] NSWCA 82 have expressed concerns about the course taken by a trial judge to orally deliver judgment in a case over some 4 days rather than to hand down written reasons.

The trial, which took place in the District Court of New South Wales, had concerned a “motor accident” case under the Motor Accidents Compensation Act 1999 (NSW). The plaintiff had been riding a horse along the side of a road when he had been thrown from the horse. He had claimed that the driving of a motor vehicle by the second defendant had caused the horse to buck and the plaintiff to suffer injury. The trial had taken 6 hearing days and, on the final day, the matter had been adjourned to a date, being some 11 days later, for delivery of judgment, with the judge directing the parties to arrange for agents to be present for the delivery of the judgment. Usually, such agents would be legal practitioners. When the matter resumed, the judge had taken 17 hours over some 4 days to orally deliver his reasons. As finally settled, the reasons were 138 pages long. The judge had given verdict and judgment for the plaintiff against the defendants for $339,242.40 and the defendants appealed to the Court of Appeal.

The Court of Appeal (McColl A/P, Leeming JA and Payne JA) unanimously allowed the appeal and set aside the orders of the trial judge. McColl A/P and Leeming JA took the opportunity to make a number of observations about the trial judge’s oral delivery of the judgment.

The key points made by McColl A/P (at [3]-[4]) were as follows:

• There was no explanation as to why the judge had orally delivered a judgment of such length, rather than, as was customary with a lengthy judgment, handing down written reasons.
• While not all members of the judiciary had access to the same resources and there were times when exigency could require oral delivery of quite extensive reasons, there was nothing on the face of the proceedings which indicated any such necessity.
• In the circumstances, it was difficult to justify the utilisation of judicial and court resources, the costs burden imposed on the parties and the time lost to the legal representatives present in court by the course taken by the judge.
• Four days for the oral delivery of a judgment could not be consistent with the overriding purpose expressed in s 56 of the Civil Procedure Act 2005 (NSW) of facilitating “quick and cheap” disposition of proceedings. Nor could this, in any event, be a useful deployment of judicial resources in a busy trial court.

Leeming JA’s observations (with which McColl A/P agreed) were, in substance, as follows (at [10]-[15]):

• Oral delivery of reasons occupying more than one day was, and is, extremely unusual, even in large and important cases.
• The judgment from which the appeal in this case was brought, although very important to the parties involved, did not fall into the category of being a large and important case, and, in addition, times had changed.
• It was difficult to see how the efficient disposal of the business of the court and the use of available judicial and administrative resources in an efficient way were promoted by the course that had been taken by the judge. There was a public cost because a courtroom, court officers and court reporters were made unavailable for the hearing of other cases. There was a private cost, borne by both parties but mostly by the losing party, of paying for legal representatives to attend over four days. And it was difficult to see how the course taken was consistent with the overriding purpose of facilitating the “just, quick and cheap” resolution of proceedings as required by the Civil Procedure Act.
• There were also non-monetary considerations to take into account. Litigation was stressful for the parties and the course taken by the judge might have increased that stress. For example, the plaintiff could not have known whether he had won or lost the case until the third day, and could not have known the extent of his damages until the fourth day. Similarly, it was not until the third day that the driver of the motor vehicle could have learned that the judge had not accepted much of her evidence.
• While there might have been reasons not known to the Court for the course taken by the judge, it appeared not to be an isolated course of action for the judge in question.
• The course taken by the judge raised the concern as to whether, having regard to the important right of judges to deliver reasons in the manner they considered as the most appropriate in accordance with their office, there might not be a different approach which accorded better with the requirements of the Civil Procedure Act and which better enhanced the administration of justice.