Oakley Thompson & Co Pty Ltd v Maisano

2 On the third day of trial, Bodycorp made its first application for me to recuse myself. That application was subsequently "deferred".[2]

3 On the fourth day of trial, which was the last day of evidence, Bodycorp made another application for me to recuse myself on the grounds of a reasonable apprehension of bias.

4 On the fifth day of trial, I delivered reasons orally dismissing that application. Those reasons were later reduced to writing ("the First Bias Application Judgment").[3]

5 On 30 June 2015, I delivered judgment on issues raised at trial ("the Trial Judgment"),[4] in which I found substantially in favour of the plaintiff, Oakley Thompson & Co Pty Ltd ("Oakley Thompson"). In doing so, I made some findings concerning the credit of the only witness called for Oakley Thompson, Jeremy Broadbent ("Broadbent"), a partner of Oakley Thompson, and also of the first defendant, Anunziato Enzo Maisano ("Maisano"). I made no findings going to the credit of the other witness at trial, the director of Bodycorp, Antonio Murdaca.

6 Also in the Trial Judgment, in addressing the multifarious contentions made by Bodycorp in seeking to oppose the relief sought, I held that some of these contentions were either misconceived[5] or of no substance.[6]

7 The proceeding came before me on 17 July 2015 for the purpose of making final orders. At the commencement of that hearing, Bodycorp made the application now under consideration. Based on the present application, Bodycorp seeks to prevent me from granting any final relief in the proceeding.

8 Essentially, the application is made on 3 grounds. It is submitted a reasonable apprehension of bias arises by reason of:

(1) Adverse findings were made against Bodycorp in the Trial Judgment.[7]

(2) In the First Bias Application Judgment, it was suggested I indicated I would not disqualify myself on the ground that there was no issue arising out of Maisano's Further Affidavit, because all parties accepted the truth of the contents of the Further Affidavit.[8]

(3) The Trial Judgment failed to address an issue allegedly before me, namely that the Earlier Judgment ought to be set aside by reason that Maisano gave false evidence in obtaining that judgment in favour of Maisano (who was the first defendant in the Bodycorp Proceeding).

9 The relevant principles in determining whether or not there are grounds for a reasonable apprehension of bias are set out in the First Bias Application Judgment.[9] For convenience, I repeat my previous observations:

The law concerning the test to be applied when an application is made for a judge to recuse herself or himself is well established. It is sufficient for present purposes to refer to the following passage of the Victorian Court of Appeal in AJH Lawyers Pty Ltd v Careri:[10]

The relevant principles governing the issue of apprehended bias are well settled. Essentially, there are eight relevant principles.

...

Secondly, as noted in Antoun,[11] judges should not "too readily accept recusal because a party has demanded it".[12] Further, as held in Ebner,[13] "[j]udges have a duty to exercise their judicial functions when their jurisdiction is regularly invoked and they are assigned to cases in accordance with the practice which prevails in the court to which they belong. ... If one party to a case objects to a particular judge sitting, or continuing to sit, then that objection should not prevail unless it is based upon a substantial ground for contending that the judge is disqualified from hearing and deciding the case".[14] That being said, the principle that a judge should not disqualify him or herself too readily is not a "blanket that smothers the effect of disqualification where it has already arisen".[15]

Thirdly, the test for a reasonable apprehension of bias was stated in Johnson[16] as being "whether a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial and unprejudiced mind to the resolution of the question the judge is required to decide".[17] The word "might" in the phrase "might not bring an impartial and unprejudiced mind" was clarified in Ebner as referring to "possibility (real and not remote), not probability".[18] On the basis of Ebner, where, as in this case, "the matter has already been decided, the test is one which requires no conclusion about what factors actually influenced the outcome. No attempt need be made to inquire into the actual thought processes of the judge".[19]

Fourthly, the apprehension in question is apprehension that the judge will not decide the case impartially, not merely an apprehension that he or she "will decide the case adversely to one party".[20]

Fifthly, the application of the test involves two steps. The first step is "the identification of what it is said might lead a judge ... to decide a case other than on its legal and factual merits".[21] The second step is the "articulation of the logical connection between the matter and the feared deviation from the course of deciding the case on its merits".[22] Contrary to AJH Lawyers' submission,[23] the two-step approach is applicable to cases of apprehended bias on the ground of prejudgment.[24] In such a case, the matter to be identified in the first step is the conduct of the judge said to give rise to apprehension of bias. And the logical connection that needs to be articulated in the second step is the logical connection between the conduct of the judge and the feared prejudgment of a question the judge is required to decide.[25]

Sixthly, "the perception of a lay observer will not be as informed as the perception of a lawyer, particularly a litigation lawyer".[26] The fictional lay observer "is not to be assumed to have a detailed knowledge of the law, or of the character or ability of a particular judge".[27] Yet the fictional observer is taken to understand the dynamics of modern judicial practice. Modern judges "are not expected to wait until the end of a case before they start thinking about the issues, or to sit mute while evidence is advanced and arguments are presented. On the contrary, they will often form tentative opinions on matters in issue, and counsel are usually assisted by hearing those opinions, and being given an opportunity to deal with them".[28] "[T]he expression of tentative views during the course of argument as to matters on which the parties are permitted to make full submissions does not manifest partiality or bias".[29]

Seventhly, "[a] line is drawn between forthright and robust indications of a trial judge's tentative views on a point of importance in a trial and an impermissible indication of prejudgment that has the effect of disqualifying the judge from further conduct of the proceedings".[30] A key factor determining whether that line has been crossed is the extent to which the views expressed by the judge appear to be final rather than merely tentative.[31]

Finally, ["j]udges do not have to devote unlimited time to listening to unmeritorious arguments. Sometimes, a brief hearing will suffice".[32] That having been said, when a party makes an application, the judge must normally give the party some reasonable opportunity to make submissions in support of that application.[33] This is so even if the judge's preliminary view is that the application will be unmeritorious.[34] If the judge refuses an application before receiving any submissions, the impression created by that conduct is not erased if the judge, after having announced his or her decision, agrees to listen to the party's submissions under sufferance.[35]

(Emphasis added in italics; original emphasis in bold.)

Bodycorp placed particular reliance upon the following passage from Livesey v New South Wales Bar Association:[36]

In a case such as the present where there is no allegation of actual bias, the question whether a judge who is confident of [her or his] own ability to determine the case before [her or him] fairly and impartially on the evidence should refrain from sitting because of a suggestion that the views which [she or he] has expressed in [her or his] judgment in some previous case may result in an appearance of pre-judgment can be a difficult one involving matters "of degree and particular circumstances may strike different minds in different ways". If a judge at first instance considers that there is any real possibility that his participation in a case might lead to a reasonable apprehension of pre-judgment or bias, [she or he] should, of course, refrain from sitting. On the other hand, it would be an abdication of judicial function and an encouragement of procedural abuse for a judge to adopt the approach that [she or he] should automatically disqualify [herself or himself] whenever [she or he] was requested by one party so to do on the grounds of a possible appearance of pre-judgment or bias, regardless of whether the other party desired that the matter be dealt with by [her or him] as the judge to whom the hearing of the case had been entrusted by the ordinary procedures and practice of the particular court.

(Emphasis added, citations omitted.)

10 The first ground may be dealt with summarily. It would undermine the due administration of justice if adverse findings in a final trial judgment were, alone, a proper basis for seeking to have a judge disqualify herself or himself before final orders were made arising out of that judgment. Where all that remains is for final relief to be granted based on the Trial Judgment, duly delivered, adverse findings in that judgment cannot be a proper basis for disqualifying myself from ordering appropriate relief.

11 Further, and in any event, the fact that I expressed a view that some of the submissions made by Bodycorp were, in effect, without merit could not, of itself, give rise to a reasonable apprehension of bias.

12 As may be seen from the principles set out above,[37] the first step in determining whether a reasonable apprehension of bias exists is the identification of what is said might lead a judge to decide a case other than on its legal and factual merits. In attempting to identify the relevant subject matter, Bodycorp has misrepresented what was stated in the First Bias Application Judgment. It was not stated that all parties accepted the truth of the entirety of the relevant parts of the Further Affidavit. Rather, it was stated that all parties sought to rely on the contents of paragraphs 16 and 25 of the Further Affidavit, and related paragraphs.[38] This is fundamentally different to a position where all parties were seeking to assert the truth of the whole of those paragraphs of the Further Affidavit.

13 Further, it was abundantly clear that Oakley Thompson did not accept the truth of the contents of those paragraphs insofar as it involved Broadbent. As I expressly noted in the First Bias Application Judgment,[39] Broadbent stated that he could not recall or denied most of the conversations in the Further Affidavit that were alleged to involve him. In particular, "he emphatically denied that he, or AAMI's senior counsel in his presence, ever suggested to Maisano what evidence Maisano should or should not give".

14 Furthermore, I understood Oakley Thompson's submissions to the effect that Maisano was an untruthful witness as arising out of the inconsistency between what he had sworn in paragraph 25 of the Further Affidavit and his evidence in this proceeding. I did not take Oakley Thompson's submissions to be suggesting anything beyond that. That is why I made the finding in the Trial Judgment on this issue based on the alternate scenarios, rather than a finding as to which version was correct.[40]

15 Moreover, to the extent that this ground appears to be a means to invite me to revisit the First Bias Application Judgment and to consider the issue afresh, it is based on a factually incorrect premise.[41]

16 This ground may also be dealt with at the first step. Contrary to the submissions made by Bodycorp, it was not an issue before me at trial as to whether or not the Earlier Judgment ought to be set aside by reason that it was allegedly procured or tainted by fraud. This was directly acknowledged in the First Bias Application Judgment.[42] Indeed, Bodycorp had no intention of introducing the Further Affidavit into evidence[43] (which was the only evidence at trial which might have been relied upon in this regard).

17 Notwithstanding the agreed list of issues,[44] and the previous absence of an intention to introduce such matters, the position of Bodycorp shifted by the end of trial. As was stated in the Trial Judgment:[45]

Further, this proceeding is not concerned with whether or not the Earlier Judgment ought to be set aside. In closing submissions, Bodycorp submitted that the Earlier Judgment was unable to be enforced because it was based on untrue evidence. In this regard, reliance was placed upon an affidavit sworn by Maisano on 17 November 2014 ("Maisano's Further Affidavit") [ie the Further Affidavit] and relied upon in a proceeding before the Court of Appeal.[46] Not only was the status of the Earlier Judgment not identified as 1 of the questions for the court to determine, but, in any event, the Earlier Judgment remains a judgment of the court. An appeal by Bodycorp against the Earlier Judgment was dismissed.[47]

18 In addition to the passage set out above, I wish to make some further observations.

19 The Further Affidavit was provided by Bodycorp to the Court of Appeal in 2014.[48] At least since that point in time, Bodycorp was in a position to apply to set aside the Earlier Judgment on the grounds that it was obtained by fraud. To date, Bodycorp has chosen not to do so. As stated by the Court of Appeal in Karam v Palmone Shoes Pty Ltd,[49] if a party seeks to set aside a judgment on the ground of fraud, it is required to either commence a separate proceeding or apply to the Court of Appeal by a notice of appeal (which now would require leave) for an order for a new trial.[50]

20 Further, the parties before the court in this proceeding were not the only parties to the Bodycorp Proceeding. There were parties beyond Oakley Thompson, Maisano and Bodycorp that have a direct interest in whether or not the Earlier Judgment ought to be set aside. Those parties include the respondents in the unsuccessful appeal from the Earlier Judgment.[51] There is no suggestion by Bodycorp that the other parties have been given any proper notice of any application, actual or intended, to be made before a trial judge or the Court of Appeal, to consider whether the Earlier Judgment ought to be set aside.

21 In these circumstances, this proceeding was not the vehicle by which to address whether the Earlier Judgment ought to be set aside.

22 The matters discussed above are sufficient to dispose of the application. They reflect the oral reasons I delivered on 17 July 2015. But in light of the further submissions made on this application concerning what was or was not the subject of this proceeding, some further comments should be made.

23 The underlying premise of the application for me to recuse myself on the First Bias Application Judgment (and perhaps implicitly on this application) was that, if there were to be issues about whether or not the Earlier Judgment was obtained on the basis of fraud, then it would not be appropriate for me, as the original trial judge, to deal with such matters.

24 Ordinarily, there is no reason why the original trial judge should not hear and determine an application to set aside a judgment on the grounds that the earlier judgment was obtained by fraud; or should not hear and determine a new trial regarding the same subject matter.[52] In fact, an approach which facilitated the trial judge hearing any subsequent application to set aside a judgment on the ground of it being obtained by fraud or any new trial aligns itself with the overarching obligations as set out in the Civil Procedure Act 2010 (Vic). In particular, such an approach is consistent with the efficient conduct of the business of the court, the efficient use of judicial and administrative resources and the timely determination of such an application.[53] Accordingly, unless the test for determining whether a reasonable apprehension of bias exists is satisfied, then, ordinarily and subject to other business of the court, the original trial judge should hear the further application and, if necessary, any new trial.

25 Finally, Bodycorp submitted that the Trial Judgment was in error because it failed to make any finding about whether or not the evidence of the conduct of Broadbent contained in the Further Affidavit was accepted by the court. It was submitted that the credit of Broadbent was directly in issue and that, in addressing that issue,[54] I failed to take into account the sworn evidence of Maisano as to the alleged conduct of Broadbent as set out in the Further Affidavit.[55]

26 As was stated in the First Bias Application Judgment, it was not necessary for the court to make any factual finding on the contents of the Further Affidavit in order to determine the issues in dispute in this proceeding.[56] Further, Bodycorp did not make any written or oral closing submissions to the effect that the court was required to make a finding on this issue.[57]

27 For these reasons, and because my findings in the Trial Judgment largely did not depend upon issues of credit,[58] I did not explicitly set out my findings in relation to Maisano's allegations as to the misconduct of Broadbent.[59] In any event, in rejecting Bodycorp's attack of Broadbent's credit, it was implicit that I was not satisfied on the balance of probabilities that Broadbent had been involved in the serious misconduct alleged by Maisano.

28 In light of the submission now made on this application, I state expressly that I was not satisfied that Broadbent was involved in the serious misconduct alleged. Of course, in failing to be satisfied that Broadbent was actively involved in procuring a witness to give false evidence, the gravity of the matter was taken into account.[60] For the sake of clarity, the failure to be so satisfied does not equate to a positive finding that Broadbent was not engaged in such conduct.[61]

29 For the reasons stated above, the application for me to recuse myself on the grounds of apprehended bias is dismissed, with costs.

[1] Bodycorp Repairers Pty Ltd v Maisano (No 8) [2013] VSC 472. See at [391]-[392].

[2] For the details, see Oakley Thompson & Co Pty Ltd v Maisano [2015] VSC 209, [14]-[19].

[3] Oakley Thompson & Co Pty Ltd v Maisano [2015] VSC 209.

[4] Oakley Thompson & Co Pty Ltd v Maisano (No 2) [2015] VSC 210.

[7] At 1 stage, Bodycorp's counsel appeared to submit that tentative views expressed in the Trial Judgment were also a basis of the application. However, I do not understand this was maintained. In any event, that basis for recusal was raised in the Costs Court Proceeding and will be addressed in due course.

[8] The Further Affidavit is defined in the First Bias Application Judgment (at [9]) as an affidavit sworn by Maisano on 17 November 2014 in the appeal proceeding from the judgment delivered on 4 September 2013, in Bodycorp Repairers Pty Ltd v Maisano (No 8) [2013] VSC 472.

[10] (2011) 34 VR 236, 241-243 [17]-[25] (Warren CJ, Hansen JA and Almond AJA).

[11] Antoun v R [2006] HCA 2; (2006) 224 ALR 51.

[13] Ebner v Official Trustee in Bankruptcy [2000] HCA 63; (2000) 205 CLR 337 ("Ebner").

[14] Ibid, 348 [19] (Gleeson CJ, McHugh, Gummow and Hayne JJ).

[15] Antoun [2006] HCA 2; (2006) 224 ALR 51, 60 [35] (Kirby J).

[16] Johnson v Johnson [2000] HCA 48; (2000) 201 CLR 488 ("Johnson").

[17] Ibid, 492 [11] (Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ). See also Ebner [2000] HCA 63; (2000) 205 CLR 337, 345 [7] (Gleeson CJ, McHugh, Gummow and Hayne JJ).

[18] Ebner [2000] HCA 63; (2000) 205 CLR 337, 345 [7] (Gleeson CJ, McHugh, Gummow and Hayne JJ).

[20] Re JRL; Ex parte CJL [1986] HCA 39; (1986) 161 CLR 342, 352 (Mason J).

[21] Ebner [2000] HCA 63; (2000) 205 CLR 337, 345 [8] (Gleeson CJ, McHugh, Gummow and Hayne JJ).

[23] Appellant's (plaintiff's) outline of submissions (30 November 2009), [12].

[24] Concrete Pty Ltd v Parramatta Design and Developments Pty Ltd [2006] HCA 55; (2006) 229 CLR 577 ("Concrete"), 609-610 [110]-[111] (Kirby and Crennan JJ).

[26] Concrete [2006] HCA 55; (2006) 229 CLR 577, 635 [177] (Callinan J).

[27] Johnson [2000] HCA 48; (2000) 201 CLR 488, 493 [13] (Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ).

[29] Concrete [2006] HCA 55; (2006) 229 CLR 577, 610 [112] (Kirby and Crennan JJ).

[30] Antoun [2006] HCA 2; (2006) 224 ALR 51, 59 [29] (Kirby J).

[31] Antoun [2006] HCA 2; (2006) 224 ALR 51, 60 [33] (Kirby J); Concrete [2006] HCA 55; (2006) 229 CLR 577, 635-636 [177]-[178] (Callinan J).

[32] Antoun [2006] HCA 2; (2006) 224 ALR 51, 57 [22] (Gleeson CJ).

[33] Ibid, 52 [2], 57 [21]-[23] (Gleeson CJ), 58-59 [28], 59 [30], 63 [48] (Kirby J), 64 [53], 65 [56] (Hayne J), 77 [83], 77-78 [86]-[87] (Callinan J).

[35] Ibid, 52 [2] (Gleeson CJ), 60 [36] (Kirby J), 78 [87] (Callinan J).

[36] [1983] HCA 17; (1983) 151 CLR 288, 294.3 (Mason, Murphy, Brennan, Deane and Dawson JJ). See also Lancaster v The Queen [2014] VSCA 333, [143] (Nettle and Redlich JJA and Almond AJA); PLP (Legal Practice) v McGarvie [2014] VSCA 253, [38] (Nettle JA and Sloss AJA); British American Tobacco Australia Services Ltd v Laurie [2011] HCA 2; (2011) 242 CLR 283, 329 [132]-[133], 333 [144]-[145] (Heydon, Kiefel and Bell JJ).

[37] Paragraph 9 above.

[38] [2015] VSC 209, [18(1)]. Although Bodycorp did not refer to it in its submissions on this application, I note that at [26] of the First Bias Application Judgment reference was made to "all parties relying on paragraphs 16 and 25 of the Further Affidavit as being true and correct". That passage must be read in the context of what immediately follows and also what is stated elsewhere in the First Bias Application Judgment concerning Oakley Thompson's position.

[41] After I delivered reasons orally, counsel for Bodycorp revisited his submissions on this application and referred to the trial transcript at T253.28-257.20. This transcript referred to the start of Maisano's cross-examination, when Oakley Thompson's counsel directly suggested that Maisano had lied in the Bodycorp Proceeding, by reference to the contents of the Further Affidavit. I understood this puttage was on the same basis as set out in par 14 above.

[43] Bodycorp's counsel informed the court that Bodycorp refrained from making an application based on apprehended bias earlier because Bodycorp was not aware that the Further Affidavit was going to be relied upon: T297.14.

[44] See Trial Judgment, [76]-[121]. See also First Bias Application Judgment, fn 37.

[46] For further detail concerning that affidavit, see First Bias Application Judgment, [9]-[12], [15].

[47] Bodycorp Repairers Pty Ltd v Australian Associated Motor Insurances Ltd [2015] VSCA 73 (Warren CJ, Beach JA and Ginnane AJA). There was no appeal by Bodycorp against the dismissal of its claims against Maisano.

[49] [2014] VSCA 148, [30] (Nettle JA, with whom Whelan JA and Almond AJA agreed).

[50] Further, if any application were ultimately made, Bodycorp would need to properly particularise the basis upon which it sought to set aside the Earlier Judgment. It would be most unsatisfactory for the court to entertain such a serious application without a clear case being properly put.

[51] The fourth defendant, Australian Associated Motor Insurers Ltd, and the sixth defendant, Barry Martin, were the first and second respondents respectively in the appeal.

[52] See, for example, Sanders v Snell (No 2) [2003] FCAFC 150; (2003) 130 FCR 149, 169-170 [77]-[82] (Black CJ, French and Von Doussa JJ); Buzacott & Co Ltd v Cyclone Pty Ltd [1920] HCA 12; (1920) 27 CLR 286, 288.2 (Knox CJ, Gavan Duffy and Rich JJ).

[53] See Civil Procedure Act, s 9(c), (d) and (f) respectively.

[54] Trial Judgment, [126]-[131]. Each of these paragraphs directly addressed the written closing submissions of Bodycorp at pars 17-19, under the heading "Evidence", that were directed to the issue of Broadbent's credit.

[55] Bodycorp also initially submitted that the fact that I did not make findings as to Broadbent's credibility in the Trial Judgment supported its application that I should disqualify myself due to apprehended bias. Subsequently, counsel for Bodycorp appeared to concede that this point did not support the present bias application.

[56] First Bias Application Judgment, [35].

[57] In light of this submission, I have reread the trial closing submissions made in writing and orally on behalf of Bodycorp to confirm that there was no submission to this effect. To be certain, an email was sent to Bodycorp's legal representatives inviting them to provide any relevant reference in the closing submissions (written or oral). An email in response received at 3.34pm on 23 July 2015 provided no reference to the closing submissions.

[59] See Beale v Government Insurance Offıce of NSW (1997) 48 NSWLR 430, 443.8 (Meagher JA), cited with approval in Fletcher Construction Australia Ltd v Lines MacFarlane & Marshall Pty Ltd (No 2) [2002] VSCA 189; (2002) 6 VR 1, 32 [101] (Charles, Buchanan and Chernov JJA).

[60] Evidence Act 2008 (Vic), s 140(1) and (2)(c); Neat Holdings Pty Ltd v Karajan Holdings Pty Ltd [1992] HCA 66; (1992) 110 ALR 449, 450.1 (Mason CJ, Brennan, Deane and Gaudron JJ), Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336, 362.2 (Dixon J).

[61] Kuligowski v Metrobus [2004] HCA 34; (2004) 220 CLR 363, 385-386 [60] (Gleeson CJ, McHugh, Gummow, Kirby, Hayne, Callinan and Heydon JJ).