Finch v The Heat Group Pty Ltd

IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 73 of 2015

JUDGE: MURPHY J DATE: 5 march 2015 PLACE: MELBOURNE

REASONS FOR JUDGMENT 1 By an originating application the applicant, Jo-Anne Finch, seeks leave to appeal from an interlocutory judgment of his Honour Justice Jessup given on 5 February 2015. In the interlocutory application before me Ms Finch seeks that his Honour's orders be stayed pending the hearing and determination of the appeal. The first respondent, Ms Finch's former employer The Heat Group Pty Ltd, and the second to sixth respondents, five persons who are alleged to have been officers or employees of the Heat Group at the relevant times, oppose a stay. 2 The orders which in relation to which leave to appeal is sought, and which Ms Finch seeks to stay, appear unusual at first blush. However, when the history of the case, its lack of progress, together with Ms Finch's medical history are taken into account, the orders are readily understandable. His Honour ordered: 1. Subject to the following orders, the further conduct of this proceeding be stayed until further order of the Court. 2. Any application by the applicant for the lifting of the said stay be filed by 4.00 pm on 2 March 2015, be returnable at 9.30 am on 5 March 2015 and be supported by a certificate of a medical practitioner: (a) stating that, notwithstanding the statement of Dr Byron Rigby dated 8 March 2014, the applicant is able, without risk to her health and without risk of the consequences of participation in court proceedings referred to by Dr Rigby: (i) to provide her solicitor and counsel with instructions sufficient for them, on her behalf, to conduct a case in court involving the allegations set out in her Further Amended Statement of Claim filed on 7 October 2014; and (ii) should it be necessary, to represent herself in the conduct of that case; and (b) stating his or her opinion as to the mental state of the applicant on 5 February 2015 and whether, on that day, she was in a condition to represent herself in court. 3. If the said stay has not been lifted by 5 March 2015, subject to any further order made on proper cause demonstrated, this proceeding stands dismissed pursuant to rules 1.40(a) and 5.23(1)(b) of the Federal Court Rules 2011 (Cth). 4. The further hearing of the respondents' interlocutory application filed on 28 November 2014 be adjourned to a date to be fixed. 5. Costs be reserved. 3 His Honour explained that, in the course of dealing with an application for security for costs, he reached the view that the application, and the proceeding itself, should be stayed "because of the applicant's medical condition and her lack of legal representation." His Honour said he was "concerned as to what might be the consequences, both for the applicant and for the Court, if I were to permit the case to proceed without any further evidence by way of qualification of that tendered over the name of Dr Rigby." 4 A short medical report of Dr Rigby dated 8 March 2014 was before his Honour. The report was not current but it was the most up to date medical evidence available in the hearing. It was handed up at his Honour's request although it had been earlier filed as part of two interlocutory applications heard on 14 March 2014. The thrust of Ms Finch's position at that time was that she was too unwell to prosecute her interlocutory application or to defend the respondents' interlocutory application. Based, it appears, on Ms Finch's explanation and the report of Dr Rigby, his Honour stayed the proceeding until such time as Ms Finch could provide affidavit evidence, including medical evidence, that she was fit to conduct a case. That stay was lifted by order of 27 June 2014. 5 Dr Rigby's report states: This is to state that I have been treating Jo-Anne Finch for the past seven years for major work-related psychiatric injury and post-traumatic symptoms associated with her participation in legal processes. Ms Finch's condition is triggered by attendance at, reference to, and engaging in activities at Court, by interactions with individuals in the Court environment, and by consideration of certain of her earlier matters that proved to be profoundly stressful. In my opinion, it is likely that Ms Finch will be unable [to] represent herself at a hearing listed for the 14th of March. If she should attempt to participate directly in her current state, there is a significant probability of decompensation, that is, of release of inhibitory factors mitigating distress, anxiety, depression and anguish. I would strongly recommend that Ms Finch receive full qualified legal representation and would advise that if possible proceedings be suspended until this is available.

The principles regarding the stay application 6 Rule 41.03 of the Federal Court Rules 2011 (Cth) ("the Rules") provides that a party bound by a judgment or order may apply to the Court for an order that the judgment or order be stayed. 7 In Alexander and Others v Cambridge Credit Corporation Ltd (Receivers Appointed) and Another (1985) 2 NSWLR 685 at 693-5 the New South Wales Court of Appeal reviewed the authorities and explained the principles. They relevantly include: (a) the onus is upon the applicant to demonstrate a proper basis for a stay; (b) the mere filing of an appeal will not, of itself, provide a reason for a stay or discharge the onus which the applicant bears; (c) the Court has a discretion to grant a stay and, if so, as to the terms that would be fair in exercising the discretion. The Court will weigh such considerations as the balance of convenience and the competing rights of the parties; (d) where it is apparent that unless a stay is granted an appeal will be rendered nugatory this will be a substantial factor in favour of a grant of a stay; (e) a court approaching an application for a stay will not generally speculate about the appellant's prospects of success. However this does not prevent the court from making a preliminary assessment about whether the appellant has an arguable case in considering the specific terms of a stay that will be appropriate to fairly adjust the interests of the parties; and (f) stay orders are not restricted only to special or exceptional circumstances. It is sufficient if the applicant demonstrates a reason or an appropriate case to warrant the exercise of discretion in his favour. These principles have been adopted and applied in many cases: see for example Powerflex Services Pty Ltd and Others v Data Access Corporation (1996) 67 FCR 65 at 66; Australian Competition and Consumer Commission v BMW (Aust) Limited (No 2) [2003] FCA 864 at [5]. 8 It is uncontentious that Ms Finch requires leave to appeal: s 24(1A) of Federal Court of Australia Act (Cth) ("FCA"). The respondents argue that Ms Finch is unable to demonstrate that there is an appealable error in the orders of Jessup J. They note that the orders are discretionary in nature and that Ms Finch will need to demonstrate an error of the type set out in House v The King (1936) 55 CLR 499 at 505 per Dixon, Evatt and McTiernan JJ. Their Honours said that it was not sufficient for an appellate court to conclude that it would have taken a different course and explained that it: …must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. 9 Where, as in the present case, the decision to be appealed concerns a matter of practice and procedure, the authorities provide that a tight rein must be kept on appellate interference. In such cases leave to appeal will usually only be granted if the decision results in a substantial injustice to one of the parties: Décor Corporation Pty Ltd and Another v Dart Industries Inc (1991) 33 FCR 397 at 398-9 per Sheppard, Burchett and Heerey JJ; Adam P Brown Mail Fashions Pty Ltd v Philip Morris Inc and Another (1981) 148 CLR 170 at 177 per Gibbs CJ, Aickin, Wilson and Brennan JJ. 10 As a result an appellate court will usually only be justified in granting leave to appeal from an interlocutory decision involving the exercise of discretion in a matter of practice and procedure if: (a) there is sufficient doubt regarding whether the primary judge has made an error in the exercise of the discretion of the type described in House v The King; and (b) substantial injustice would result if, the decision being supposed to be wrong, leave to appeal were refused. This shows that Ms Finch faces a high bar in the application for leave to appeal. 11 The respondents also argue, and I accept, that if a stay is not granted the appeal is not nugatory. They point to order 3 of Jessup J's orders which allows Ms Finch to apply to the Court, after dismissal of the proceeding by the self-executing orders, to set aside the dismissal and have the proceeding reinstated. 12 There is some force to the respondents' contentions. However it became apparent in the course of the hearing that Ms Finch's complaint regarding the orders included the fear that it was impossible to meet their express requirements. She was concerned about the difficulty in obtaining the services of a doctor prepared to read the voluminous Further Amended Statement of Claim and then offer his or her opinion (as his Honour required) particularly on short notice. She also concerned about whether a doctor would be prepared to, in effect, "guarantee" that her future medical state would not impact on her ability to instruct lawyers or represent herself in the proceeding. 13 At the Court's suggestion Ms Finch agreed to urgently seek a consultation with her treating psychiatrist, Dr Rigby, and ask him to do the best that he could by providing a short report. She anticipated obtaining an appointment in about two weeks and she agreed to prepare and provide the doctor with a short summary of the main allegations in the proceeding rather than a copy of the Further Amended Statement of Claim. While Ms Finch said that Dr Rigby understood the nature of her case she agreed to provide a short summary of allegations so as ensure that he was properly aware of the nature of the claims made. This was aimed at ensuring Dr Rigby was in a good position to report on the possible psychological effects of Ms Finch's continued participation in a proceeding, either through counsel or representing herself, which in the past he considered would cause her some psychological injury. 14 Ms Finch agreed to advise Dr Rigby that the Court did not require or expect him to provide an opinion providing a certain prognosis as to her future mental state. Rather, he was to do the best that he can to provide his current opinion as to her mental state and as to the likely risks and consequences of her participation in the proceeding, as referred to in his earlier report. She agreed to immediately provide the report received from Dr Rigby together with summary of the allegations to the Court and to the respondents, and to immediately advise chambers when that has occurred. 15 Conditional upon Ms Finch's agreement I reached the conclusion that an order staying the orders of Jessup J of 5 February 2015 was in the interests of justice. In doing so I am concerned to avoid interfering with the orders of Jessup J when they have not been shown to involve any appealable error, but I note the Court's broad discretion as to whether to grant a stay, and if so, as to the terms that would be fair. 16 In my view the balance of convenience and the competing interests of the parties favour the grant of a stay on the orders, conditional upon Ms Finch taking the course to which she agreed. 17 As I have said, I accept that the appeal is not nugatory if the stay is not granted. If Ms Finch is successful in the appeal then the orders dismissing the proceeding will be set aside. If Ms Finch is unsuccessful in the appeal that she would still be able to obtain the medical report ordered and could then apply to the Court for the proceeding to be reinstated. 18 However, I see this as an inefficient and costly way of dealing with the present situation. Section 37M of the FCA provides that the overarching purpose of the civil practice and procedure provisions is to facilitate the just resolution of disputes, according to law, and as quickly, inexpensively and efficiently as possible. The course for which the respondents contend requires the parties and the Court to unnecessarily expend time and resources to hear and determine the application for leave to appeal, and if that is successful the time and resources of the parties and a Full Court to hear and determine an appeal. One may well ask why that course should be taken when Ms Finch has now agreed to obtain a medical report substantially as Jessup J ordered. 19 Upon the filing of Dr Rigby's report the Court can decide the next step. 20 Whatever the final result the respondents are in no worse position than they are today, save for the effluxion of approximately further five weeks. This slight delay is of no great moment when the proceeding has been on foot for more than two years without yet reaching the stage of Defences being filed. I can see no real prejudice to the respondents in this. In fact, the respondents may avoid the time and expense of a hearing of the application for leave to appeal and an appeal. 21 Nor is Ms Finch in any worse position. Her appeal rights remain intact. The application for leave to appeal has been adjourned and it may be amended to include any further ground which later arises. She too may avoid the same time and expense as the respondents. 22 While I understand the respondents' frustration, the question of convenience is not a matter only for the parties. The Court must efficiently use its judicial and administrative resources so as to efficiently dispose of the Court's overall caseload, and it must be cognisant not only of the parties' interests but of the effect upon other litigants and the Court itself: s 37M(2)(b)-(d) of the FCA; Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175 at [111] per Gummow, Hayne, Crennan, Kiefel and Bell JJ. In my view the course which I have ordered is likely to represent the most efficient use of the parties and the Court's resources. 23 I have ordered a stay conditional upon Ms Finch's agreement to obtain a report from Dr Rigby. I have adjourned the application for five weeks to 9 April 2015, and prior to that date I expect that Dr Rigby's report will have been filed and served. I certify that the preceding twenty-three (23) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Murphy.