Cullen v Whalan

Failing to Deal With/Misapprehending a Clearly Articulated Argument

1. The appellants' complaint that the Magistrate failed to deal with or misapprehended a clearly articulated argument is a complaint which involves a constructive failure by the Magistrate to exercise jurisdiction. In Dranichnikov v Minister for Immigration and Multicultural Affairs, [2] it was recognised that such a failure to exercise jurisdiction also reflects a failure to afford natural justice. Accordingly, a complaint of this type involves a denial of procedural fairness.
2. In Resource Pacific Pty Ltd v Wilkinson, [3] Basten JA observed that a constructive failure to exercise jurisdiction reflects failure by the Court to resolve the dispute between the parties and that can occur in circumstances where a material issue has not been addressed or material evidence has been overlooked.
3. At the heart of the appellants' contention that the Magistrate failed to deal with or misapprehended a clearly articulated argument is a complaint involving the reasoning process undertaken by the Magistrate.
4. Mr Vuu contended that, had procedural fairness been afforded, the Magistrate would have placed greater weight on the affidavit of Mr Jackson, would have appreciated that the appellants had no burden to prove there was a contract between them and Mr Jackson, and would have appreciated that the legal onus rested with the respondents to prove the existence of the alleged contract with the appellants.
5. In oral submissions before me, the appellants argued that the Magistrate was distracted from the onus which rested upon the respondents and had concluded, axiomatically, that because there was no subcontract between Jackson and the Whalans, there was therefore an oral contract between the Cullens and the Whalans.
6. The appellants' written submissions also suggest that the Magistrate was influenced in her finding of a contract between the Whalans and the Cullens by her conclusion that there was no contract between the Cullens and Jackson. This, as I understand the submission, also demonstrates that the Magistrate was "distracted" from the onus which rested on the respondents to prove the contract on which they relied.
7. Otherwise, the appellants asserted that the Magistrate's reference to a concession by the appellants in submissions that it did not matter to them who harvested the crop was "inapt to be so characterised." It was said that the submission from which the so called concession was drawn, in fact favoured the appellants' construction and should not have been used against the appellants' construction in those circumstances.
8. In argument, when I suggested that the appellants' position on this ground of appeal was focused on the way the Magistrate determined the appellants' arguments as opposed to ignoring or misunderstanding those arguments, the appellants' counsel submitted that the Magistrate's resolution of the competing arguments as to the contractual interpretation were not dealt with in a procedurally fair way. It was put on behalf of the appellants that, essentially, the respondents had not proved the elements of the oral contract found by the Magistrate. Again, the mainstay of that complaint was that her Honour was distracted in her task by her conclusions that there was no contract between the Cullens and Jackson, nor any sub-contract between Jackson and the Whalans.
9. The appellants contended that the Magistrate should have engaged in a more fulsome interrogation of Mr Jackson's evidence which, on the appellants' case, would have resulted in a different conclusion as to whether there was a contract between the Whalans and the Cullens.
10. In support of his arguments at the hearing before me, Mr Vuu made submissions in relation to one particular aspect of the evidence concerning some affidavits which were before the Magistrate but which were not referred to in the judgment in the recitation of material relied upon by the parties.
11. On this point, Mr Vuu referred me to affidavits of Tom Whalan, John Whalan and Tracey Whalan dated 23 May 2023 (the May 2023 affidvits). Those affidavits form part of Exhibit JPD-3 to the affidavit of Justin Philip Drew sworn 1 July 2024, which is Exhibit 1 in this appeal. Mr Drew deposes to the fact that, inter alia, the May 2023 affidavits were relied upon by the parties and formed part of the respondents' evidence at the hearing.
12. That statement is not entirely accurate. The transcript of 20 December 2023 (at p 4. 40 - p 5. 40) makes it clear that Mr Eather, who appeared for the Whalans before the Magistrate, did not rely upon the May 2023 affidavits but, rather, relied upon affidavits of Tom Whalan, John Whalan and Tracey Whalan dated 2 September 2023 (the September 2023 affidavits).
13. However, Mr McGirr, who appeared for the Cullens before the Magistrate, asked her Honour to retain the May 2023 affidavits because the affidavits upon which he was relying responded to those affidavits. This would enable the appellants' affidavits to be better understood. Thus, strictly speaking, the May 2023 affidavits were not relied on as evidence by either party but were available to the Magistrate to understand the evidence.
14. It was common ground that, in respect of the matters to which they deposed, the May 2023 affidavits had been subsumed by, and were not materially different from, the September 2023 affidavits.
15. In submissions before me, Mr Vuu confirmed that the appellants do not, and, in my view, sensibly could not, elevate the failure by the Magistrate to refer to the May 2023 affidavits as a denial of procedural fairness in the sense of a failure to consider evidence. Rather, as I understand it, the submission advanced on behalf of the appellants is that the failure by the Magistrate to refer to the May 2023 affidavits may provide an explanation for what the appellants contend to be a failure by the Magistrate to properly consider the respondents' onus of proof. The reasoning here, as I understand it, is that chronologically the affidavits recited by the Magistrate in her judgment commence with affidavits relied upon by the appellants and thus, it is said, this may explain why her Honour failed to have in the forefront of her mind the onus which rested on the respondents, who as the moving parties would normally go first with their evidence.
16. As Mr Vuu put it, "It implied that we had to go first because the burden was on us when in effect what was actually happening was that our material was being responsive to what was being put in the earlier May affidavits."
17. Leaving aside whether this could have any relevance to a failure to afford procedural fairness, I find that proposition unconvincing. The Magistrate referred to the evidence relied upon by the parties. The May 2023 affidavits were only ever retained in order to understand the appellants' evidence and did not add anything to the substance of the evidence before the Court. There was no reason for the Magistrate to refer to the May 2023 affidavits. The speculation embedded in the appellants' submission on this point takes the matter nowhere in my view.
18. The respondents argued that the appellants' submission, that the Magistrate treated findings as to the absence of a contractual arrangement between Jackson and the Cullens as determinative of the contractual relationship between the Whalans and the Cullens, was manifestly incorrect.
19. The respondents contended that the appellants' submissions did not disclose any argument which the Magistrate failed to consider or misunderstood. Otherwise, the respondents submitted that the appellants' complaint as to the Magistrate's use of the so-called concession was obscure in terms of how that could give rise to a denial of procedural fairness, and, in any event, was misconceived.

Consideration

1. I have considered the evidence that was before the Magistrate along with the written and oral submissions made to her Honour. The issues at play, albeit controversial, were relatively straightforward and in my view reflect the Magistrate's analysis. Those issues were, in the first instance, whether there was a contract between the Whalans and the Cullens for the harvesting work in question. Beyond that, if there was a contract, the Magistrate had to determine the terms of that contract and finally whether the Cullens were contractually bound to pay the amount claimed by the Whalans.
2. The arguments advanced by the parties were also relatively straightforward. The Whalans contended that they had contracted with the Cullens for the work to be performed. The Cullens contended that their agreement was with Jackson and they had no contractual obligation to pay the amounts in question.
3. Outside those general parameters, as is invariably the case, there were a number of factual twists and turns in relation to what was said by the players involved in the controversy, what had happened with harvests in the past, what occurred on this occasion and whether prior arrangements were distinguishable because of the prevailing circumstances, as well as what one was to make of payments made by the Cullens to the Whalans for the work in question in the absence of any accounts having been rendered to the Cullens by Jackson.
4. This is the imbroglio which is litigation. There were any number of potential outcomes and whilst I do not purport to cast doubt upon the propriety of the factual findings, it is not my function to consider the correctness of the decision ultimately reached by the learned Magistrate, only whether there was a denial of procedural fairness in the process.
5. I am left in no doubt that the Magistrate considered and understood the arguments and submissions advanced on behalf the appellants.
6. The submissions of the appellants in relation to the contended failure of the Magistrate to deal with, or the misapprehension of, clearly articulated arguments are, in my view, submissions firmly grounded in the merits of the Magistrate's decision.
7. The Magistrate (transcript of judgment at p. 8.30 - 8.45), referred to well settled authority dealing with the fallibility of memory and indicated that she balanced the competing evidence of the witnesses against the objective surrounding facts and contemporaneous documents.
8. What weight the Magistrate should have placed on the evidence of Mr Jackson, what the Magistrate was to make of the arrangements between the parties and how the Magistrate was to approach the determination of the contractual arrangements in place were all matters within the ambit of her Honour's decision-making function.
9. I consider the appellants' complaints that the Magistrate misconstrued submissions as a "concession" to be of no moment. In the passage of the judgment complained of (transcript of judgment p10.10-10.15) the Magistrate was referencing a submission which had been made on behalf of the appellants to the effect that they were not concerned as to the identity of the party doing the harvesting. [4] It is clear from the terms of the passage of the judgment in question that this was a view formed by the Magistrate independently of the submissions to which she referred. Leaving aside whether this is a complaint going to a denial of procedural fairness, at its highest it is a complaint that the Magistrate misdescribed the submission as a concession. If that is correct, in my view nothing turns on it. The Magistrate was doing no more than expressing a conclusion she had reached on the evidence. The appellants' submission to which she referred did not inform that conclusion but was consistent with it. Clearly, the Magistrate understood the evidence and the issues at play. How she resolved the evidence and what she made of the submissions advanced by the parties were matters for her.
10. In my view, the complaints which are said to constitute a denial of procedural fairness in relation to this ground of appeal are all complaints about the way in which the Magistrate determined the issues which were before her, rather than reflecting a failure by her to consider or understand the arguments and submissions advanced on behalf the appellants.
11. The fact that the Magistrate may have taken a different approach had she accepted the interpretation of the evidence advanced by the appellants does not amount to a failure to consider those arguments and that evidence.
12. As was said by Meagher JA in Day v SAS Trustee Corporation: [5] "[A] constructive failure to exercise jurisdiction (or a purported exercise, in the sense that there is an appearance of an exercise of jurisdiction) as alleged by the appellant is not a mere failure to consider evidence or to address an argument or submission, which may be contingent or otherwise insignificant, but a failure to understand and determine a case or claim. The ultimate question is whether a failure to consider and address certain issues or arguments involved a failure to address central or critical elements of the case or claim: compare, in relation to failures to consider evidence, Minister for Immigration and Citizenship v SZRKT (2013) 212 FCR 99; [2013] FCA 317 at [69], [111]. It will be insufficient for the appellant to show that his "three key issues" were not stated and determined discretely. What he must show is that they raised "substantial" (in the sense of clearly material) arguments or questions which the primary judge in substance failed to address in determining the appellant's claim…".
13. Similar comments were made by Allsop CJ, Markovic and Colvin JJ in CZA19 v Federal Circuit Court of Australia [6] , where it was pointed out that the fact that different views may be taken by other judges is not to the point and jurisdictional error of the type in question here requires a fundamental misunderstanding of the nature of the application such that, in effect, the application is not considered.
14. In my view the approach of the Magistrate in the present case was conventional. She understood and grappled with all of the critical arguments, issues and submissions which were raised by the parties and came to conclusions based on her interpretation of the evidence before her.
15. I consider there was no failure to deal with, or misapprehension by the Magistrate of, the arguments put on behalf the appellants. The complaint of a denial of procedural fairness on this basis is not made out.

Failure to Draw Certain Matters to the Appellants' Attention

1. The core of the appellants' argument in respect of this complaint is the proposition that the Magistrate failed to foreshadow at any stage that if she were to find there was no contractual relationship between the Cullens and Jackson, this would be determinative of the Whalans' claim of a contract with the Cullens. The submission put orally also included the complaint that the Magistrate should have put the appellants on notice that she was going to find against the existence of a contract between the Whalans and Jackson.
2. In written submissions, relying on Nathanson v Minister for Home Affairs [7] , it was said by the appellants that "The content of procedural fairness demanded that the actual documents the Magistrate was going to rely upon to deny the appellants' success on their defence be drawn squarely to the parties' attention and its potential significance" [8] .
3. Specifically, it is contended by the appellants that the evidence of Mr Jackson was central to the question of the subcontract and, as I understand the appellants' submission, the Magistrate was obliged to advise the appellants in the event that she did not accept Mr Jackson's evidence. It is said that because Mr Jackson's evidence was critical, the appellants were entitled to know if it was not to be accepted.
4. In submissions before me it was put that in the course of the hearing, Mr McGirr should have been asked by the Magistrate what outcome he contended should follow in the event that her Honour did not accept the evidence of Mr Jackson.
5. The appellants rely upon a number of authorities of the High Court in support of their position and, in particular, Manebona v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs & Anor [9] and Plaintiff M1/2021 v Minister for Home Affairs [10] .
6. The respondents argue that a judge is not required to disclose before judgment the significance the judge sees in any particular piece of evidence, nor to inform a party that the judge intends to make an unfavourable finding against that party.

Consideration

1. In Adamson v Ede, [11] Campbell JA (with whom Giles and Hodgson JJA agreed) provided a comprehensive exposition of procedural fairness particularly in the context of natural justice.
2. His Honour expressed the view that there was no general proposition that a judge should inform someone concerning whom the judge is contemplating making an unfavourable finding, to give them a specific opportunity to argue against the finding being made.
3. His Honour went on to refer to F Hoffmann-La Roche & Co AG v Secretary of State for Trade and Industry [12] , where Lord Diplock made the observation that: "[T]he rules of natural justice do not require the decision maker to disclose what he is minded to decide so that the parties may have a further opportunity of criticising his mental processes before he reaches a final decision. If this were a rule of natural justice only the most talkative of judges would satisfy it and trial by jury would have to be abolished."
4. Campbell JA also referred to SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [13] , where the High Court said: "Procedural fairness does not require the Tribunal to give an applicant a running commentary upon what it thinks about the evidence that is given. On the contrary, to adopt such a course would be likely to run a serious risk of conveying an impression of prejudgment."
5. The authorities relied upon by the appellant, in my view, are distinguishable from the present case. Largely they involve proceedings before a tribunal where the aggrieved party could not reasonably have been expected to be aware of, or have anticipated the significance of, certain matters without those matters having been drawn to the party's attention.
6. In my view, the present case is very different.
7. There can be no doubt from the submissions and the arguments before the Magistrate that there was a robust exchange in relation to how the facts ought be interpreted and the evidence considered. There were any number of possible outcomes and they clearly included the potential that evidence, including that of Mr Jackson and the appellants, may or may not be accepted.
8. In my view, it ought have been within the contemplation of the parties that their evidence may not be accepted in whole or in part, hence the attempts to persuade the Magistrate as to their respective positions.
9. I consider the present case falls squarely within that class of case referred to in Ede, where the outcome complained of was well within the knowledge and anticipation of the parties.
10. Accordingly, I am of the view that the second limb of the appellants' complaint of a denial of procedural fairness is not made out.

Orders

1. For those reasons, I make the following orders: 1. The appeal is dismissed. 2. The appellants are to pay the respondents' costs.
2. In respect of costs, I observe that in the respondents' written submissions an anticipatory order was sought that costs be paid on an indemnity basis given what was said to be the lack of merit in the appeal and the appellants' dilatory conduct in pursuing the appeal.
3. Whilst the appeal was unsuccessful, I do not consider this is a case where it can be said that there was a lack of merit justifying an order for indemnity costs. The dilatory conduct complained of is largely unexplained, but I assume this is a reference to the appellants' submissions being filed about three weeks late. This resulted in the respondents' submissions being late as well. I do not know the reasons for the delay, however, the respondents have been able to meet the appellants' submissions and there is no evidence of any additional costs being incurred by the respondents as a result.
4. In the circumstances, I decline to make the order for indemnity costs sought by the respondents.

Endnotes

1. See s 35, Local Court Act 2007 (NSW).
2. [2003] HCA 26; (2003) 77 ALJR 1088 at 1092-1093, [24]-[27].
3. [2013] NSWCA 33 at [9].
4. See paragraph [13] of the appellants' written submissions to the Magistrate reproduced in Exhibit JPD-6 to the affidavit of Mr Drew, which is Exhibit 1 in these proceedings.
5. [2021] NSWCA 71 at [37].
6. [2021] FCAFC 57; (2021) 285 FCR 447; (2021) 390 ALR 1.
7. [2022] HCA 26; (2022) 276 CLR 80 at [62]-[63].
8. Appellants' written submissions at [26].
9. [2023] FCAFC 116; (2023) 298 FCR 516.
10. [2022] HCA 17; (2022) 275 CLR 582.
11. [2009] NSWCA 379.
12. [1975] AC 295 at 369.
13. [2006] HCA 63; (2006) 228 CLR 152. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 23 August 2024