Commonwealth Bank of Australia v Rigg

REASONS FOR JUDGMENT (ON APPLICATION FOR TRIAL BY JURY)

INTRODUCTION 1 The judgment debtors have moved the Court for an order that the trial of the issues to be determined on the judgment creditor's petition for the sequestration of their eestates under the Bankruptcy Act 1966 (Cth) with the be trial by jury. In my opinion, for the reasons which follow, whilst the Court may in its discretion order trial by jury in any matter, some special reason must be shown for departure from the normal mode of trial of actions in jurisdictions of the kind exercised by this Court, and no special reason exists here. 2 Section 39 of the Federal Court of Australia Act 1976 (Cth) ("the Act") provides: "In every suit in the Court, unless the Court or a jJudge otherwise orders, the trial shall be by a jJudge without a jury." 3 Section 40 of the Act provides: "AThe cCourt or a jJudge may, in any suit in which the ends of justice appear to render it expedient to do so, direct the trial with a jury of the suit or of an issue of fact, and may for that purpose make all such orders, issue all such writs and cause all such proceedings to be had and taken as the Court or jJudge thinks necessary. …" 4 In McDermott v Collien Colian (1953) 87 CLR 154, the operation of ss 12 and 13 of the High Court Procedure Act 1903 (Cth), which are in substantially the same terms as ss 39 and 40 of the Act, were considered by Fullagher J. His Honour said at 157: "But, so far as any question of general policy is involved, it is settled for me by the High Court Procedure Act. Trial without a jury is the normal mode of trial of actions in this Court, and some special reason must be shown for a departure in any particular case from that normal mode. The second thing that seems clear is that it is not enough to show that the cause of action is of a kind which could quite properly be tried with a jury and which was normally tried with a jury in England before the Judicature Act (1873) (36 & 37 Vict. c.66). The decisions of Hodges Jin [Proud v Ferguson (1913) VLR 129] and of Isaacs J and Huntley JJ in [Huntley v Alexander (1922) 30 CLR 566] perhaps suggest that the nature of the cause of action is not even a relevant consideration.." 65 Perhaps these references do indeed suggest that the nature of the cause of action is not a inrelevant consideration. I would not be prepared to assent to that as a general proposition. Indeed, I would have thought that it might in some cases be a potent consideration. But it is clear that it is not enough to say 'this is a kind of action which is quite suitable for a trial with a jury and I would like to have it tried with a jury'. The plaintiff in this case cannot, in my opinion, say any more than that. It seems to me that it is a complete answer to him for the defendant to say 'this is a kind of action which is also quite suitable for trial without a jury'. 76 Similar views have been expressed in other cases including Insurance Commissioner v Australian Associated Motor Insurers Ltd (No 2) (1983) 49 ALR 714 at 717; v Pavlomanolakos v National Australia Bank (1992) FCA 278Pablucvanos ……..; Asseck Australian Securities & Investments Commission v Matthews[1999] FCA 706 ….; Denison Dinnison v Commonwealth of Australia [2000] FCA 1841. In Asseck Australian Securities & Investments Commission v Matthews, Sackville J considered whether contempt proceedings constituted a special reason for departure from the usual mode of trial by judge alone. Sackville J said (par 15): "These authorities and others suggest it would be rarely, if ever, that the cCourt will exercise its power to order a jury trial in contempt proceedings. It follows that, far from the nature of contempt proceedings providinged a basis for departing from the normal mode of trial, the contrary is true. The practice is settled and has received endorsement from the High Court. The point can be illustrated by contempt proceedings recently determined in this cCourt by a jJudge sitting aloneg. …" 87 It appears that trial by jury has never been ordered in this Court. Lindgren J noted in All States Life Assurance v New Zealand Banking Group Limited (1996) 64 FCR 1 that a jury trial had not to that point (ie, 1996) ever been empanelled by the Federal Court. His Honour said (at page 38): "This complex commercial case is not an appropriate one in which the Court might for the first time in the Court's history order a jury trial." 98 In fact, s 30(3) of the Bankruptcy Act 1966 (Cth) specifically provides for a discretion to order trial by jury in a bankruptcy matter. It provides: "If in a proceeding before the Federal cCourt under the this Act a question of fact arises thatand a party desires to have tried a trial before a jury, the Federal cCourt may, if it thinks fit, direct the trial of that question to be had before a jury,. and Tthe trial may be had accordingly in the same manner as if it were the trial of an issue of fact in an action." 109 The Full Federal Court (Drummond, Dowsett and Katz JJ) has recently held that s 30(3) of the Bankruptcy Act 1966 (Cth) gives a discretion to the Court to direct trial before a jury without giving any entitlement to a party to have a trial by a jury:Houdna Hubner v ANZ(2000) 101 FCR 71. In coming to this conclusion, the Full Court rejected arguments that a party was entitled to a trial by jury (in spite of s 30(3)) on the grounds of "natural justice" and by virtue of Schedule 2 to the Human Rights and Equal Opportunity Commission Act 1986 (Cth). Schedule 2 incorporates the English text of The International Covenant on Civil And Political Rights 1966. 1110 This reasoning accords with an earlier decision of the Full Court involving the same parties: Hubner v ANZ (1999) 88 FCR 445. There the Court (Cooper, Kiefel Cooper and Tamberlin JJ) said (at 450): The Court under Ss30(3) has a wide discretion and there is no entitlement to a jury trial given by the section." (Emphasis in the original) 1211 A similar construction has been given to comparable legislative provisions. In rRe Coward Stapleton v Brady ([1952]) QWN 15 Clyne J, dealing with s 25(2) of the Bankruptcy Act 1924 (Cth), held that the provision gave the court a complete discretion; this was so even if the matter involved allegations of fraud. Kline Clyne J said (at page18): "[Section 25(2)] gives the court complete discretion. While fraud generally is some ground for giving the parties or one of the parties a right to trial by jury, this fact is not conclusive. In this case there are, in my opinion, very strong counterveiling..... considerations. It is well known that actions or willsuits for the declarations of trust and orders for account are not normally tried beforeby a jury. …. I think it would be wrong to put matters of this description, involving sS94 of the Bankruptcy Act and questions of the declarations of trust, even if fraudulent, before a jury." 12 His Honour also said(at pg 19): that the fact that there would be 'much investigation of documents and accounts caused him to find that it would be more convenient and more appropriate' for that the original application to be heard by a judge and not by a judge and jury. 1413 Similarly, Iin rRe Allen (19053) 5 SR (NSW) 55, Walker J held that s 134 of the Bankruptcy Act 1898 (NSW) conferred a discretion. Walker J said (at 57): "In my opinion the lLegislature intended that all questions arising in a bankruptcy, whether they would otherwise have been triable at law or in equity, should be tried in the same way, namely by the jJudge alone, . Uunless the jJudge himself desires a jury, or he thinks that a party applying for one has made out a case for that mode of trial…Aa jury should not be empanelled unless special circumstances are shown." 1514 This approach has since been followed by Mansfield J in Commonwealth Bank of Australia v Heinrich [2000] FCA 1255. In that matter, an application was made for a ssequestration order against the eestate of Mr Heinrich, on the petition of the Commonwealth Bank. Application was made by the debtor pursuant to s 30(3) of the Bankruptcy Act1966. Mansfield J said (at par 23): "If s 30(3) of the Act is within power, the respondent did not make any submission as to why the Court should exercise discretion under s 30(3) to order a jury trial. … In rRe Shields; ex parte Australia and New Zealand Banking Group Limited (1994) 51 FCR 308, Einfeld J said at 309 that in Bbankruptcy proceedings jury trials will be the exception rather than the rule. His Honour added: '"A jury trial involves a great deal of expense and time, both to the parties and the cCourt, as well as considerable inconvenience to the members of the community who constitute the jury. The use of juries in civil matters has steadily declined during this century and is now largely reserved for those areas where serious imputations are to be made against the character ofor a party. Like divorce, bankruptcy is no longer regarded as such a matter. and in In the absence of some very compelling special circumstances, the intention of Parliament is clearly that bankruptcy proceedings be heard by a judge.'." 1615 In Heinrich there was an attempt to go behind a judgment of the Supreme Court of South Australia. Mansfield J said (at par 24): "… I am firmly of the view that the balance lies clearly in refusing the application. The first matter is simply that I do not consider the respondent has shown any real foundation for the Court going behind the judgment,… and I consider the respondent would need to demonstrate some reasonable prospect of the cCourt, by a jury trial, securing an answer to a question or questions favourable to the respondent before being satisfied thatan it would order a trial by jury in relation to that question or questions. In addition, the respondent's claims of the bank fraudulently altering its records was subject to establish a liability against the respondent where none existed, or that he was in any event no longer indebted to the bank, are each matters which required, (as one of his other complaints acknowledges), the a detailed and careful and informed analysis of the bank's records and of his own records. They are not simply matters dependent upon the assessment of the reliability of one oral assertion over another. Such issues, at least in proceedings such as the present, are more suitably determined by a judge. … Furthermore, the picture which the respondent seeks to present, is a complex one, with a series of inter-related steps. I do not think it would be appropriate for to refer to a jury the duty to answer one or more of those steps, without considering the whole picture. …" 16 For present purposes, Heinrich appears to be on all fours with the present case. Here also there are the following elements in the judgment debtor's opposition to the petition: an attempt to go behind the judgment after a contested trial;. and an invitation to this Court to scrutinise a substantial volume of documentary material. 1817 In my opinion, these considerations point strongly, in terms of costs and delay, against involving a lay jury. The application must be refused with costs.