Chapter 3
Key issues
Introduction
3.1
There was general support in evidence for the intent of the Bill with
recognition of the importance of mechanisms, including alternative dispute
resolution (ADR), which assist with the resolution of matters before they
proceed to court or provide a means to clarify and narrow issues in dispute.
Resolving disputes or clarifying issues reduces costs and delays for all
parties.[1]
3.2
Professor Tania Sourdin commented that the Bill (as well as the
Victorian Civil Procedure Act 2010) is part of the shift in how justice,
the courts and ADR are perceived and is based on the view that 'justice and
effective dispute resolution can be achieved and can occur outside the court
system'. It also reflects the maturity and success of existing pre litigation
schemes and alternative dispute resolution and 'an eagerness to embrace more
developed pre litigation arrangements'.[2]
Professor Sourdin went on to state:
The draft legislation, drawing on the success of the
extensive industry based and other pre litigation ADR schemes adopts this more
modern approach to dispute resolution and assumes that the Court is not at the
centre of dispute resolution. Rather the Court has an integral and pivotal role
in policing obligations and adjudicating, managing and resolving the more intractable
disputes.[3]
3.3
However, some witnesses were of the view that there are significant
issues raised by the Bill including the mandatory nature of the genuine steps
obligation, the use of the term 'genuine steps' rather than 'reasonable steps',
the exemption provisions and the potential impact on disadvantaged litigants
and access to justice. For example, Mr Ben Schokman, Human Rights Law Resource
Centre, stated:
...an efficient and cost-effective civil justice system is
certainly a very legitimate and important aim, but that needs to be
counterbalanced with the fundamental rights of access to justice and the right
to a fair hearing.[4]
The 'genuine steps' obligation
3.4
A major issue raised by some submitters was that the proposed 'genuine
steps' obligation imposed mandatory pre-action protocols. For example, the Law
Council of Australia (Law Council) submitted that while it supported early
resolution of disputes without recourse to the courts if 'used effectively in
the right cases', it had reservations about mandatory pre-action protocols for
federal jurisdiction.[5]
The Law Council considered that the use of pre-action protocols in certain
cases resulted in more expensive and time-consuming proceedings 'if not done properly,
thus resulting in added costs and denial of, or delay in, access to justice'.[6]
Mr John Emmerig, appearing on behalf of the Law Council, commented 'if you
made it mandatory, people could start playing games with what constitutes
genuine steps at the front end of the action'.[7]
3.5
Mr Emmerig also noted that in some cases the proposed genuine steps
obligation is unnecessary as 'in major cases there is always some form of
engagement before proceedings are filed'. In addition, the application of the
genuine steps obligation for class actions or other major proceedings raised
uncertainty as to whether the obligation extends to just the representative
party or all members of the class.[8]
Mr Emmerig concluded that:
...the general thrust of the bill is that, to the extent that
pre-action procedures or protocols of the kind proposed here are being proposed
for use in civil litigation, we would suggest to you that experience shows that
this one-size-fits-all approach does not tend to be an effective way to
proceed.[9]
3.6
The Federal Court of Australia (Federal Court) submitted that the
proposed protocols are not suitable for much of its work, 'well beyond that
excluded by clauses 15 and 16'. Further:
The Court's experience is that ADR is most effective when
used in conjunction with active case management at a time when the parties are
in an informed position to properly assess their risk. When that point arises
varies from case to case depending on numerous facts and matters including
subject matter of the proceedings, the nature and complexity of the issues in
dispute and relative strengths of the parties.[10]
3.7
Mr Soden, Registrar and Chief Executive Officer, Federal Court, noted that
the United Kingdom Costs Review conducted by Lord Justice Jackson (Jackson Review)
found that 'a general protocol for all civil litigation served no useful
purpose because one size does not fit all'.[11]
The Federal Court went on to provide a list of actions which it recommended be
excluded from the pre-action protocol (exemptions are discussed further at paragraphs
3.38-3.44 below).
3.8
The National Alternative Dispute Resolution Advisory Council (NADRAC)
and the Attorney-General's Department (the Department) responded to this
evidence. NADRAC noted that it did not recommend the introduction of mandatory
ADR in its 2009 Report and the Bill does not introduce mandatory ADR. Further,
ADR is simply an example of one of the steps a party may choose to undertake
and 'what amounts to a "genuine step" is not defined, and is up to
the parties to determine within the context of their particular dispute'.[12]
3.9
In relation to concerns about pre-action protocols, the Department
commented that the Bill 'is not a pre-action protocol, nor does it mandate ADR,
or indeed, any particular steps'. While the Bill requires that parties inform
the court about the steps they have taken to resolve the dispute, or if they
have not taken steps, failure to lodge a genuine steps statement does not
invalidate an application. Parties will be able to take steps which meet the
needs of their particular circumstances as the steps contained in the Bill are
examples only, not mandatory, and the Bill does not limit what steps a party
may consider. The Bill also allows for circumstances where no genuine steps are
possible or appropriate.[13]
3.10
The Department also emphasised strongly that the purpose of the Bill is
to allow for flexibility about what steps, if any, may be taken to accommodate
the needs of parties and issues involved in a particular dispute. The
Department went on to state:
By allowing parties to determine the most appropriate action
to take in their particular case, the Bill directly contrasts with prescriptive
mandatory pre-action protocols.[14]
3.11
The Department noted that the Bill contrasts with the prescriptive
general pre-action protocols applying in the UK which were the subject of
criticism in the Jackson Review. Mr Matthew Minogue, Attorney-General's
Department, stated that 'the proposal that was recommended to government sought
to address the concerns that had been raised and the UK experience with
prescriptive pre-action protocols'.[15]
3.12
Mr Minogue went on to comment that 'a fair reading of the bill will
quickly allay concerns because it is not prescriptive; it is illustrative'.[16]
Further, this was 'quite a deliberate policy choice':
Because the experience from the UK and from stakeholders like
the Federal Court and the Law Council is that prescribing specific steps does
not work. It is actually counterproductive. It is far better to leave it to the
parties themselves to attempt to resolve their disputes and so the parties
themselves can undertake the steps that they deem appropriate to attempt to
resolve their dispute. Where the discipline, if you like, comes into it, is
where a matter is filed, if a matter is filed.[17]
3.13
It was pointed out that 'the bill does not prevent and does not seek to
prevent people from accessing a court'.[18]
However, the government wanted the Bill to have effect and Mr Minogue stated:
We want people to actually undertake genuine steps. But the obligation
on them is to file a statement. The reason why it is separated, and the saving
is in clause 10 [failure to file a statement does not invalidate proceedings] is
that it is a preservation, it is a non-invalidity provision. We do not want
people to escape the obligation but what we do say is we do not want this to
become a barrier to people accessing courts or pursuing litigation.[19]
3.14
Mr Minogue also pointed to the benefits of the 'genuine steps'
obligation: that it has the effect of turning people's minds to resolution
prior to filing. If a matter goes to court, the genuine steps obligation will
result in the provision of information that will be of benefit to both the
parties and the court in the later case management function, or may result in a
narrowing of the issues in dispute.[20]
The Attorney-General's Department also noted that the Bill is a continuum of
the court's existing powers in relation to case management.[21]
3.15
Other submitters also supported the Bill's flexible approach to
achieving dispute resolution. The Castan Centre for Human Rights Law stated
that the Bill 'is merely directing parties to take steps to narrow issues and
to endeavour resolution of disputes prior to resorting to litigation'.[22]
National Legal Aid saw the obligation to take genuine steps as 'appropriate'
and commented that it has 'the potential to improve the early resolution of
disputes'.[23]
The view was supported by the NSW Department of Justice and Attorney General
which commented that the measures 'will promote the early resolution of
disputes and the narrowing of issues in dispute prior to commencement of
proceedings'.[24]
Costs and delays
3.16
The issues of costs and delays and the impact on access to justice were
also taken up by submitters. It was argued that costs and delays may occur
because of satellite litigation, interlocutory litigation and disputes as to whether
genuine steps have actually been taken. The Law Council also commented the
costs may increase, resulting in 'undesired outcomes'.[25]
3.17
The Federal Court commented that 'there is the very real likelihood that
a legislated genuine steps requirement will increase the cost and time of
litigation, contrary to the overarching purpose set out in the Federal Court
of Australia Act 1976'. Increases in costs would arise from the
preparation and filing of additional statements and 'risk being subject to the
cost and delay of interlocutory disputes under clause 11 of the Bill that have
no bearing on the substantive issues in the litigation'.[26]
3.18
Mr Soden, Federal Court, also voiced concern about complex cases and the
case of querulous litigants. Mr Soden considered that the genuine steps
obligation would be 'extremely difficult in the complex cases, and I imagine
that the genuine steps statement could be quite detailed, quite complex, quite
long and possibly quite expensive'.[27]
In relation to querulous litigants, it was submitted that they will focus on a
problem with the genuine steps and thereby add to costs and delays. Mr Soden
stated that unrepresented querulous litigants:
...are not going to be deterred by the risk of adverse costs orders
made in relation to those proceedings. It is our experience that they are
unlikely to be in a position to be able to pay those costs, so the burden of
that problem will fall to a respondent.[28]
3.19
In response to these concerns, NADRAC submitted that it has 'carefully
considered' concerns about increased costs and it had proposed the genuine
steps requirement 'as a flexible, alternative approach to mandatory ADR, that
should not incur significant extra costs for parties'.[29]
Further, NADRAC stated that:
To the extent that additional costs are incurred, they are at
the discretion of the parties and would therefore be proportionate to the
dispute, and should be reasonable in the circumstances. By narrowing the issues
in dispute through a genuine steps process, there should be a reduction in the
cost of litigation, and increased efficiency in the disposition of matters by
courts.[30]
3.20
In relation to possible delays, NADRAC submitted that the measures it
recommended 'were to help change the adversarial culture and encourage prospective
litigants to turn their minds to resolution before commencing legal proceedings'.
In addition, resolving disputes through the genuine steps process will avoid
unnecessary litigation and shorten the course of disputes.[31]
3.21
The Department also responded to concerns about costs and delays. It
emphasised that the Bill allows for the parties to determine the genuine steps
that they will take. In addition, as noted by NADRAC, even when a matter is not
resolved through the genuine steps process, benefits will arise as matters in
dispute will be clarified or narrowed thus saving time and decreasing costs
when the matter is considered by the court.[32]
3.22
The Department commented on the specific matters raised. The Department
noted that the Bill is designed to minimise the risk of satellite litigation:
while a genuine steps statement must be filed, failure to do so does not invalidate
proceedings. A failure to take genuine steps does not create rights in the
other party and parties cannot litigate whether genuine steps were taken or
sufficiently taken.[33]
This, it was argued, 'addresses the satellite litigation concern, because all of
the issues about the adequacy or otherwise of a statement, or the adequacy or otherwise
of the genuine steps that may or may not have been taken, will be exercised by
the court's existing case management powers'.[34]
3.23
In relation to class actions, Mr Minogue commented that 'it would be
perfectly permissible and appropriate for the court to say that the lead
plaintiff, the one who commences the application, should make the substantive genuine
steps statement'.[35]
As to complex litigation, Mr Minogue responded:
Complex litigation that is not a class action is the very situation
where it encourages people to attempt to resolve the dispute or narrow the
issues, and that is precisely what the bill is encouraging people to do. It is
not just the bill saying this or NADRAC saying this. Litigators say this, law
reform commissioners say this, chief justices say this. It is not an unusual or
difficult proposition.[36]
3.24
It was also noted that the provisions of clause 18 of the Bill allow the
court to take account of a number of matters in relation to genuine steps
statements. Thus the Department argued that:
That is an empowering provision that gives the court, in my submission,
exactly what it is concerned about. If people are concerned about costs, the
court could say: pages should be no more than two pages long; statements should
be no more than two pages long. If they are concerned about a particular
jurisdiction, they can particularise that as required for a specific protocol.
The concerns, in my submission, are addressed in the bill.[37]
3.25
The benefits of the genuine steps obligation were also supported by the
Castan Centre for Human Rights Law which commented that it saw as unlikely
significant costs and delay flowing from the broad, non-prescriptive provisions
of the Bill.[38]
The Centre concluded:
If the reforms have the effect of easing the courts'
caseload, then they may facilitate the more timely access to courts for contests
incapable of resolution outside the judicial process. Litigation may also be
simplified and shortened by the narrowing of issues afforded by pre-litigation
steps. Such benefits would in fact enhance the right of access to court
proceedings.[39]
Federal Court alternative approach
3.26
The Federal Court submitted what it saw as a simpler and less expensive
approach to that proposed in the Bill, for consideration by the committee. This
approach involves the enactment of legislation requiring a person contemplating
litigation to serve on the prospective respondent a short statement of their
case which provides adequate description of the factual, and legal claim, and
which could stand as their statement of case in any subsequent litigation. The
Federal Court noted that, if that step were taken, the court would be given
jurisdiction over any ADR of that 'matter' and the parties would be able to
access the court-annexed mediation conducted by the registrars in the Federal
Court.[40]
3.27
The Federal Court saw benefits in this approach as the costs of
court-annexed mediators is substantially less than external mediators; and court-annexed
mediators also have access to the Federal Court's case management powers
including powers to order alternative and appropriate forms of ADR and the
ability to refer matters to a judge to resolve issues if and when they arise.[41]
Mr Soden commented:
Our experience is that if we get hold of a matter early and
case manage it under our case management provisions, and a matter is referred
to ADR as a result of that process, often it will settle. If it does not
settle, the issues are refined and the case goes on to hearing in a much more
truncated version than if it is not touched.[42]
3.28
The committee sought comments from the Law Council in relation to the
Federal Court's proposal. The Law Council indicated that, in the time available
and on the information available, it was unable to provide a concluded point of
view on the proposal. However, the Law Council did support the principle behind
the proposal and it recommended that it be given further consideration, and be
the subject of proper consultation, by and between the Attorney-General's
Department, Federal Court, Law Council and other stakeholders.[43]
3.29
The Department also commented on the Federal Court's proposal and
stated:
Any attempt to simplify pleadings deserves consideration, and
while the alternative has a complementary objective to the Bill, the Department
does not believe that the Court's proposal is a substitute for it. The Bill is
intended to encourage a greater focus on resolution before parties
contemplate litigation. The Federal Court’s proposed alternative approach is to
apply to parties already contemplating litigation.[44]
'Genuine' versus 'reasonable' steps
3.30
The Bill proposes that disputants take 'genuine steps' to resolve
disputes before commencing litigation before the Federal Court and the Federal
Magistrates Court. There was considerable discussion in submissions about the
term 'genuine steps' with some submitters noting that the Victorian legislation
uses the term 'reasonable steps' as do proposed amendments to existing NSW
legislation.[45]
3.31
A number of submitters argued that the use of the word 'genuine'
introduces a degree of subjectivity which the word 'reasonable' does not.[46]
The NSW Department of Justice and Attorney General, for example, commented that
the subjective element introduced by the term 'genuine' makes the meaning of
the provisions less clear and compliance more difficult.[47]
Mr John Emmerig, Law Council, concurred with this view and commented that
'"reasonable" allows one to apply well-established principles of
objectivity in the assessment'.[48]
Ms Tania Penovic, Castan Centre for Human Rights Law, commented:
I do prefer the Victorian formulation of reasonable steps. I
think it is broader and it is a more meaningful way of gauging the steps that
have been taken. Genuine steps may extend to steps that are genuinely taken by parties
but may not fall within the threshold of reasonableness.[49]
3.32
A number of submitters noted that the concept of reasonableness was well
known and permeates many areas of the law.[50]
3.33
However, National Legal Aid agreed with the 'flexible approach the
legislation adopts in relation to the definition of "genuine steps",
because it recognises that what amounts to "genuine steps" will
depend upon the circumstances of the case'.[51]
3.34
Mr Minogue, Attorney-General's Department, responded by noting that the
NADRAC report went into the reasons it preferred 'genuine' rather than
'reasonable'. [52]
In its report, NADRAC commented that it was not aware that the term 'genuine
steps' had been used before in the law of civil procedure either in Australia
or in other countries. However, NADRAC stated that it 'considers that it is a
phrase that can usefully be given its ordinary meaning in the circumstances of
any particular dispute'. NADRAC went on to provide the reasoning for its
recommendation of the 'genuine steps' requirement rather than other
requirements such as 'genuine effort'. NADRAC considered that the 'genuine
effort' formula, contained in the Family Law Rules, was a much more subjective
concept and 'may be misinterpreted as applying a standard of conduct to some
ADR processes that is inappropriate'.[53]
3.35
NADRAC also considered that while it is appropriate to take genuine
steps to resolve a dispute, 'it is inappropriate (and probably impermissible)
to require a person to make concessions or compromise'. NADRAC was of the view
that using mechanisms such as 'genuine effort' or 'good faith' requirements may
pressure disputants to make concessions in order to avoid later costs
penalties. This may arise in cases where there is a significant power
imbalance; one of the parties is financially disadvantaged; or where a party
has a very strong case and is justified in not compromising their position.[54]
3.36
In relation to the concept of 'reasonableness', NADRAC commented:
What is reasonable may depend on the capacity of the
disputants, the nature of the dispute, the type of process, the skill
demonstrated by the ADR practitioner and particular events on the day.[55]
3.37
The Department also added:
The term 'genuine' has been used as this was the term
favoured by NADRAC in its report, over 'reasonableness'. Genuine is a more
meaningful term to encourage parties to consider what they can do to attempt to
resolve the dispute. Courts have tended to say that reasonable means 'not
unreasonable', which risks being a minimal standard. Further, the Department
notes that the Family Law Rules have required parties to property and parenting
disputes in the Family Court to make a genuine effort to resolve disputes since
2004. The Department is not aware that the use of the term 'genuine' has
created any difficulty.[56]
Exemptions
3.38
Clauses 15 and 16 of the Bill provide for a number of exemptions from
the operation of the genuine steps obligation. The list was viewed as narrow by
some witnesses.[57]
The Federation of Community Legal Centres–Victoria, for example, submitted that
there should be an exemption for public interest litigation, while the Law
Council commented on the need to exclude a range of other matters including
certain bankruptcy matters, interlocutory injunctions, proceedings where expert
opinion is required and multi party civil disputes.[58]
3.39
The Federal Court also provided the committee with a list of the types
of cases that should be excluded from pre-action protocols. The list,
reproduced in full at Appendix 3, includes administrative law, admiralty,
bankruptcy, taxation, and patents. Mr Soden commented that they are 'examples
of where a genuine steps requirement would be a waste of time and money and not
necessary'.[59]
The Law Council, noting the Federal Court's comments, argued that this
'demonstrates again that a "one-size-fits-all" approach is
inappropriate'.[60]
3.40
The NSW Department of Justice and Attorney General also raised the
concern that it may not be clear as to whether a particular application is
wholly or partly excluded, leading to disputes in some cases. It was argued
that to avoid doubt about whether, and on what basis, a party is claiming
exemption from the genuine steps requirements, all applicants (other than those
excluded pursuant to clauses 15(c) and 16) be required to file a statement.[61]
3.41
Some submitters commented that bankruptcy matters should be excluded
from the operation of the Bill. The Insolvency Practitioners Association of
Australia (IPA) submitted that the matters undertaken by practitioners varied
and that some did not lend themselves to pre-litigation alternative dispute
resolution. However, IPA was of the view that the flexibility provided by the
Bill would accommodate the varied circumstances involving insolvency
practitioners. In relation to many court actions by insolvency practitioners,
for example, the recovery of moneys or assets, IPA stated that the Bill would provide
'a useful regime' and 'assist practitioners to recover moneys for creditors
more cost effectively and efficiently'.[62]
3.42
In relation to the exclusions in the Bill, the Department noted that
extensive consultations had been undertaken and 'exclusions to the Bill were
made where significant dispute resolution processes were already developed and
further genuine steps would not be of assistance'. The Department considered
that the Bill is sufficiently flexible so as not to require express exclusion
of additional matters. In addition, incorporating more exclusions may focus
parties on how to fit within an exclusion, rather than encouraging
consideration of what genuine steps can be taken to seek to resolve the matter.[63]
3.43
The Department also noted that, if required, additional exclusions can
be provided for through the regulation making power.[64]
3.44
The Attorney-General's Department also provided the committee with a
detailed response to the Federal Court list of additional exclusions. This is also
reproduced in Appendix 3. The Department stated:
...a significant proportion of the matters included in the
classes proposed for exclusion by the Federal Court, are more than 12 or 18
months old. Taking genuine steps for such matters would enable more productive
attempts at resolution, which even if unsuccessful, would narrow the issues in dispute
and provide better information to the court at the commencement of the
litigation, thus reducing the length of any subsequent proceedings.[65]
Disclosure of information
3.45
A matter raised by the Castan Centre for Human Rights Law and the NSW
Department of Justice and Attorney General related to the disclosure of
information and documents under subclause 4(1)(c) which offers, as an example
of genuine steps, 'providing relevant information and documents to the other
person'.
3.46
The Castan Centre for Human Rights Law argued that there may be an
interference with a right to privacy if a disputant felt compelled by the
genuine steps obligation to reveal private information. In order to overcome
this problem, the Centre recommended that the Bill be amended to include the
same limitations on the use of documents for purposes extraneous to the dispute
at hand as are extended to litigants in the discovery process.[66]
3.47
The NSW Department of Justice and Attorney General also supported
provisions to protect material disclosed and noted that such an amendment
would:
...strengthen the Bill by giving parties confidence to disclose
sensitive material relevant to settlement negotiations prior to litigation
being commenced. Otherwise parties may choose to commence proceedings which
might otherwise have resolved by consent merely in order to ensure certainty
regarding the protected status of sensitive documents.[67]
3.48
The Law Council raised concerns about the provision of documents
relating to major cases. Mr Emmerig commented that it is difficult to compile
and present relevant information and documents for a major case and it is unrealistic
that the other litigant would commence discussions without accessing this
information.[68]
Impact on disadvantaged groups
3.49
A number of submitters voiced concern that the mechanisms proposed in
the Bill may result in disadvantaged litigants being unable to participate in
the civil justice system on the same basis as other litigants.[69]
Ms Lucie O'Brien, Federation of Community Legal Centres–Victoria, submitted
that, while being broadly supportive of the Bill, there was a need to ensure
that people were not inadvertently disadvantaged. Ms O'Brien commented:
...we think that there are some specific issues faced by
low-income and socially disadvantaged people in the context of ADR. ADR works
very well for most people, but if you suffer from some kind of disadvantage,
most obviously the inability to retain a lawyer or to get free legal
representation—also things like language difficulties, age or a general
unfamiliarity with the Australian legal system—you can be disadvantaged by ADR,
particularly if you are engaged in a dispute with someone who does not suffer
from those disadvantages.[70]
3.50
Mr Schokman, Human Rights Law Resource Centre (HRLRC), also pointed to
potential disadvantage through power imbalances that 'perpetuate why the
dispute was brought in the first place and why it has ended up being potentially
litigious and also where there may be individuals who do not understand what
legal consequences there might be in disclosing information or conceding
particular points'.[71]
In addition, HPLC (PILCH Homeless Persons' Legal Clinic) and HRLRC commented
that the court's discretion to take into account a party's failure to undertake
genuine steps may have a significant impact on litigants who are unable to
access or afford legal advice and/or representation during pre-trial
negotiations.[72]
3.51
HPLC and HRLRC concluded that the Bill in its current form 'may have
potentially adverse affects for some litigants that undermine the fundamental
right to a fair hearing' and made recommendations which they saw as ensuring that
the Bill more adequately upholds the right to a fair hearing. These recommendations
included:
- that the efficiency measures encapsulated by the Bill should be
balanced by consideration of the fundamental need to ensure that disadvantaged
litigants are afforded a fair hearing;
- clarification of how unrepresented and potentially disadvantaged
litigants will be assisted to understand their rights and obligations;
- clarification of the cost implications of any failure to take
genuine steps to negotiate disputes; and
- the requirement that the court take into account the relative
position of the parties in terms of resources and legal representation when
considering the consequences of failing to take genuine steps.[73]
3.52
The Federation of Community Legal Centres–Victoria and National Legal
Aid also supported the need for the court to take into account the relative
positions of parties when considering the genuine steps undertaken and
exercising its discretion to award costs.[74]
The Federation of Community Legal Centres–Victoria submitted that the Bill
should provide more guidance to the court to ensure that discretion is
exercised more appropriately.[75]
On this point, National Legal Aid suggested that considerations, similar to
those in unfair dismissal laws in relation to differences in the circumstances
of parties, would be appropriate in relation to the powers of the court concerning
these matters.[76]
3.53
HPLC and HRLRC also recommended that access to legal advice and
representation be required for all potential litigants who are required to
undertake pre-trial negotiations to ensure that they have access to justice,
equality before the law and a fair hearing. The Federation of Community Legal
Centres–Victoria went one step further and submitted that if people could not
obtain legal representation, then they should be exempt from the genuine steps
obligation.[77]
3.54
The Department commented that it appreciated the concerns that
litigation disadvantages people from low income backgrounds but went on to
state that 'because the Bill is flexible, rather than disadvantaging such
people, it has been designed to better enable them to resolve disputes from a
more equal position'.[78]
In addition, the government has increased legal assistance funding as part of
the Access to Justice measures.[79]
Mr Minogue provided the committee with additional comments:
There are several matters in response to that: the bill not
being rolled out on its own but being part of the comprehensive access to
justice reforms; the substantial increase in legal assistance funding, as I
have referred to; the specific obligations on legal assistance providers to
give greater effect to early intervention, more advice and upfront assistance;
and better referral to appropriate legal and non-legal support services. So
that fills that gap.[80]
3.55
NADRAC also commented on the view that where a party is disadvantaged in
some way, they can only get justice from a court. NADRAC stated that it
understood the reasons for this view but did not support it. NADRAC noted that
ADR practitioners carefully assessed the disputants and provided, or referred
people to, processes that were appropriate to their needs. In addition, NADRAC
submitted that disadvantaged litigants may be better served by a process which
resolved their disputes in a quick, inexpensive and safe process rather than in
lengthy, stressful and costly court proceedings.[81]
Consultation
3.56
The committee questioned the Department about the extent of the
consultations undertaken in relation to the Bill. Mr Minogue responded that
NADRAC undertook extensive consultation in the preparation of its report and went
on to state:
The content [of the legislation] is the NADRAC
recommendation. By raising the fact that the government was going to legislate
to implement the recommendation, people were aware that that was going on. In particular,
the Federal Court was consulted since the beginning of this year.[82]
3.57
Mr Minogue indicated that the Department had consulted government
agencies including Customs and the Australian Taxation Office. In addition, the
Federal Court had been provided with drafting instructions in March and more
detailed proposals in April. Formal transmission of the draft Bill was provided
in May. When questioned about the Chief Justice's response to the draft, Mr
Minogue commented that the Chief Justice's response to the draft bill was not
inconsistent with his submission to the committee.[83]
Conclusions
3.58
The committee notes that the Civil Dispute Resolution Bill 2010 is part
of the government's moves to improve access to justice. It also reflects a
cultural shift in how the position of the courts is perceived in the justice
system. Through the 'genuine steps' obligation, the Bill aims to support the
resolution of certain civil disputes in the Federal Court and the Federal
Magistrates Court before litigation is commenced. The committee considers that
the introduction of this obligation is an important initiative in ensuring that
there is a focus on resolving a matter before costly and time consuming
litigation is undertaken. Even when matters are not resolved, there will be a
benefit to parties as the issues in dispute will be clarified and narrowed.
3.59
The committee has carefully considered arguments that the Bill
introduces mandatory pre-action protocol. The committee is satisfied that this
is not the case. Rather, while it is obligatory to provide a genuine steps
statement, the Bill provides flexibility to the parties to determine the steps
that they wish to take to resolve their dispute and allows for circumstances
when genuine steps cannot be undertaken. The Bill provides examples of genuine steps
but does not mandate those that should be taken. This is the case with ADR: although
witnesses focused on mandatory ADR, the Bill only provides ADR as an example of
a genuine step, not a mandated step.
3.60
However, the committee believes that the Bill would benefit from the
addition of an inclusive definition of 'genuine' to better reflect the
intention of the NADRAC report and to provide guidance to the parties involved.
Recommendation 1
3.61
The committee recommends that the Bill be amended to provide for an
inclusive definition of the word 'genuine' to better reflect the intention of
the National Alternative Dispute Resolution Advisory Council report.
3.62
The committee has also considered the extensive discussion in evidence
in relation to the exclusions to the genuine steps obligation. The committee is
satisfied that the list of exclusions is appropriate and that, as indicated by the
Department, should the need arise, further additions to the list can be made
through regulation.
3.63
In relation to disadvantaged litigants, the committee has noted the
comments by the Attorney-General's Department and NADRAC that disadvantaged
litigants may benefit from less stress, cost and delay through the genuine
steps obligation. In addition, disadvantaged litigants will benefit from the
additional resources provided by the Australian Government through its Access
to Justice measures. However, the committee considers that the Bill should be
amended to ensure that disadvantaged people benefit from the proposed regime
and are not further disadvantaged or denied access to justice by ensuring that
the court, in considering the genuine steps taken by a person when it is
exercising its powers or performing its functions, takes into account the
circumstances of disadvantaged litigants.
Recommendation 2
3.64
The committee recommends that the Bill be amended so that the court,
when taking into consideration the genuine steps that have been taken by a
person when it is exercising its powers or performing its functions, also takes
into account the circumstances of disadvantaged litigants.
3.65
The committee has also noted the concerns raised by the Castan Centre
for Human Rights Law and the NSW Department of Justice and Attorney General in
relation to the disclosure of information and the possible interference with a
right to privacy. The committee considers that the Bill would be improved if it
contained provisions to ensure that information disclosed cannot be used for
any purpose outside the resolution of the dispute at hand.
Recommendation 3
3.66
The committee recommends that the Bill be amended so that information
disclosed during the genuine steps obligation cannot be used for any other
purpose outside the resolution of the dispute at hand.
3.67
As a final matter, the committee was concerned about the comments made
in evidence in relation to the consultation undertaken by the Department before
the Bill was introduced. While many stakeholders contributed to the NADRAC
report, the committee considers that the Department would have been well served
by engaging more thoroughly with stakeholders before the Bill was introduced in
the Parliament.
Recommendation 4
3.68
The committee recommends that, subject to the recommendations in
relation to the definition of the word 'genuine', the consideration of position
of disadvantaged litigants and the protection of the privacy of documents, the
Senate pass the Bill.
Senator Trish Crossin
Chair
Navigation: Previous Page | Contents | Next Page