McHugh v Australian Jockey Club Limited

REASONS FOR JUDGMENT 1 This is an application for an extension of time to appeal against orders made by the primary judge, Robertson J, on 19 December 2012. The application is made under rule 36.05 of the Federal Court Rules 2011. That rule confers upon the court a broad discretion as to whether or not to grant an extension of time. A number of factors commonly stated as informing those principles, they were summarised by Foster J in DZAAD v Department of Immigration and Citizenship [2013] FCA 204, at [28]. The factors include the length of the delay, whether the applicant has provided an acceptable explanation for the delay, whether there is any prejudice to the respondent, and the merits of the appeal if an extension is granted. 2 The relevant principles were also explained, although admittedly in relation to a different set of rules, by the West Australian Court of Appeal in the matter of Simonsen v Legge (2010) WASCA 238. There was a very useful summary of the relevant matters to guide the exercise of the discretion set out in paragraph 8 of the judgment. The principles drawn from a number of well-known authorities, including the decision of McHugh J in Gallo v Dawson (1990) 64 ALJR 458 at 459; 93 ALRA 479 at 480 to 481. The importance of what McHugh J said in Gallo may be stated very briefly. In particular his Honour pointed out that the grant of an extension of time is not automatic, and that the object of the rule is to ensure that the rules which fix times for doing acts do not become instruments of injustice; the discretion to extend time is given for the sole purpose of enabling the court to do justice between the parties. 3 In order to determine whether the rules will work an injustice it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation and the consequence for the parties of the grant or refusal of an application for the extension of time. 4 His Honour cited in support of that proposition a case which is very commonly cited in relation to such applications: Jess v Scott (1986) 12 FCR 187 at 194-5. Although Jess v Scott was decided under a previous version of the current Federal Court Rules, the principles stated in that authority have been held to be applicable under the rules that are now in force. As McHugh J pointed out, it is necessary to bear in mind that in an application such as this, upon the expiry of the time for appealing, the respondent has a "vested interest" to retain the judgment unless the application is granted. 5 The rules of court must prima facie be obeyed, and in order to justify the court in exercising the discretion to extend time, there must be some material upon which the court can exercise its discretion. That last-mentioned principle seems to me to be embodied in Rule 36.05, which requires in subparagraph 3(c), an affidavit stating briefly the facts on which the application relies and why the notice of appeal was not filed within time. 6 It seems to me that, notwithstanding the helpful written submissions of Mr Bova, who appears for the AJC, the VRC and the ATC, the proper exercise of my discretion in the light of the principles stated in the authorities justifies the grant of an extension. It seems to me to be important to bear in mind that the individual factors which guide the exercise of the discretion should not be looked at in isolation. The discretion is a very broad one and is a question of balancing and considering all of the factors which the courts have taken into account as guiding the exercise of the discretion. 7 In some cases one factor may have more weight than others, but the factors which are of particular importance are not only the explanation for the delay, but the absence of prejudice to those opposing the extension of time, and a consideration of the merits of the case. Here the length of the delay is, in my opinion, not inordinate. Whilst it is true that the rules of court, and the time limits established by the rules, are not optional, each matter must be looked at in the light of the overall circumstances. 8 In the present case, the rules required the notice of appeal to be filed by 31 January 2013; the delay was therefore six weeks. Having regard to the length of the trial which occupied some seven weeks of hearing time, and the fact that his Honour - without any criticism to him, having regard to the substantial nature of the case - reserved his judgment for 12 months, I think that the case is probably one in which more than 21 days was required within which to give proper attention to the preparation of an informative notice of appeal. It is also relevant to bear in mind that the rules which are in question in the case have been in force since the 1940s, although the particular rule in question was not established until 1980. 9 Nevertheless the issue of the significance of artificial insemination has been one which appears to have been debated in the industry since at least the 1980s and possibly earlier. The substantial force of Mr Bova's submission went to the explanation for the delay. I reject the submission that the threshold requirement stated under Rule 36.05 paragraph 3(c) was not complied with. There was an affidavit which addressed the matters required by the rules. Indeed, there were two such affidavits, one from Mr Rogers, the solicitor for the applicant, and another from senior counsel who appeared at the hearing. 10 The real issue seems to be whether the explanation was an adequate one. Mr Bova submitted, again with some force that there ought to have been an affidavit filed by Mr McHugh who is the applicant, and no such affidavit was filed. However, he also pointed out that in those circumstances I am left with questions of what inferences ought to be drawn from the material that was put before me. Of course in each case it must be essential for the court to look closely at the affidavit material which has been filed, and no hard and fast principle can be stated other than that the explanation must be one which the court regards as adequate. In my opinion, the explanation for the delay in the present case is adequate. Importantly, the evidence of senior counsel was that by the time judgment had been delivered he had retired from practice, although he had kept his practising certificate in force with a view to being able to advise on the prospects of an appeal from any adverse judgment. 11 Nevertheless, it seems to me to have been entirely reasonable for Mr McHugh to act on the advice of senior counsel that a second opinion ought to be obtained, presumably from counsel who would be briefed to run the appeal. I do not think in the present circumstances that it was necessary for Mr McHugh to have filed an affidavit, although perhaps the position would have been improved had he done so. It is sufficient, in my opinion, to say that having regard to the complexity of the matter and the need for any notice of appeal to be an informative one, the course which was adopted - and the explanation for it - were reasonable. 12 It is true that the Federal Court Rules do not provide for the filing of a holding appeal as is done in the Supreme Court of New South Wales, and accordingly the only alternative course for the applicant would have been to file a very lengthy notice of appeal which took issue with most, if not all of the findings. That would not have been a course which I ought to endorse. Mr Bova also submitted, again with some force, that it may have been open to Mr McHugh to have filed a notice of appeal dealing only with the very limited grounds which are now proposed to be agitated. 13 However, I think in the circumstances that in light of the length of the judgment there is nothing unreasonable in the course which was adopted. This is not to give my imprimatur to the view that the rules of court can be ignored. Mr McHugh was clearly aware of the fact that the time limit expired on 31 January. He appears to have therefore taken the risk that the court would grant an indulgence to him. It is, I think not entirely safe to proceed upon the view that the court will grant an indulgence, but this does seem to be to be a case where I should do so. I also bear in mind that Mr McHugh's solicitors wrote to the respondents advising them of the course that was proposed to be taken, whatever the limitations in the material or information that was provided. I think the importance of what was said was that it put the respondents on notice that they could not safely assume that they had the benefit of a vested right of judgment in accordance with the orders made by the primary judge. 14 That correspondence goes to issues including questions of length of the delay, the explanation for it, and the absence of prejudice. Ultimately what seems to me to be important in the present case is that an efficient course of action was followed in which a notice of appeal, raising only limited grounds going to the restraint of trade issue rather that the issues under the former Trade Practices Act section 45 are proposed to be ventilated. More critical to my determination of whether to exercise the discretion is the absence of prejudice. I have already referred to the comparatively short delay and the history of the proceedings and the issue itself which go back for some considerable time. Importantly, the payments on the present applications did not point to any evidence of prejudice other than their right to secure the benefit of the time limit laid down by the rules. 15 What seems to me to be important here is that Mr Bova did not submit that the appeal is hopeless. Indeed, the effect of his approach seems to me to be that, of course without making any admissions, he concedes that the issues proposed to be argued on the appeal are at least fairly arguable. 16 The consequences for Mr McHugh if I do not grant the extension of time are, as was accepted by both parties, draconian. Whilst there is no evidence as to the amount which has been expended, I think I can safely infer that large amounts of money were expended by him in the case at first instance. Also, the outcome of the case has significant commercial consequences for him and, indeed, for the thoroughbred industry both locally and globally. The matter may not be one in which the test could be characterised as a claim which is based upon the public interest. It is a commercial dispute between the parties, but the issues involved are of significance in the thoroughbred industry, as I have already said. I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jacobson.