Patterson v Westpac Banking Corporation

RAPER J 1 These reasons address an interlocutory application by the first respondent seeking certain documents be ordered confidential following settlement of the proceeding by the parties. This is the second occasion upon which I have been asked to order certain documents in these proceedings be confidential. On 13 June 2024, the first respondent's application, supported by the applicant, for orders that certain documents be made confidential until the exhaustion of the mediation process, was granted: see Patterson v Westpac Banking Corporation [2024] FCA 629 (Patterson (No 1)). 2 On this occasion, the first respondent made application, with the consent and support of the applicant, pursuant to s 37AF of the Federal Court of Australia Act 1976 (Cth), for the following documents to be ordered "confidential" within the meaning of r 2.32(1)(b) of the Federal Court Rules 2011 (Cth), for an unfixed period, by reason of the fact that the proceeding has been settled on confidential terms and such an order is necessary to prevent prejudice to the proper administration of justice: (a) Originating Application filed 13 December 2023; (b) Concise Statement filed 13 December 2023; (c) Statement of Claim filed 26 March 2024; (d) Affidavit of Andrew Gray sworn 7 May 2024; (e) Third, Fourth and Sixth Respondents' Interlocutory Application filed 13 May 2024; (f) Amended Originating Application filed 24 May 2024; (g) Amended Statement of Claim filed 24 May 2024; (h) Third, Fourth and Sixth Respondents' outline of submissions filed 4 June 2024; (i) Third, Fourth and Sixth Respondents' Amended Interlocutory Application filed 4 June 2024; (j) Affidavit of Andrew Gray sworn 7 June 2024; (k) First Respondent's Interlocutory Application filed 11 June 2024; (l) Affidavit of Andrew Gray sworn 11 June 2024; (m) First Respondent's outline of submissions filed 11 June 2024; (n) Fairfax Media Publications Pty Ltd's outline of submissions filed 11 June 2024; (o) The First Respondent's Interlocutory Application dated 28 June 2024; (p) Affidavit of Andrew Gray in support of the Interlocutory Application, including any annexures or confidential exhibit to that affidavit; (q) The First Respondent's outline of submissions in support of the Interlocutory Application; and (r) Any materials in response to or in support of the Interlocutory Application filed by any person or party, including any affidavit or submissions filed by any such person or party. 3 At hearing, the first respondent no longer pressed its application with respect to the documents at (j) to (q), preserved its position with respect to (r), but ultimately did not press (r). 4 The question for this Court to determine is whether it is necessary to order that the documents listed at (a) to (i) above be confidential so as to prevent prejudice to the proper administration of justice. 5 For the following reasons, I am satisfied that, in the peculiar circumstances of this case, it is necessary, in order to prevent the contended prejudice to the proper administration of justice, to make the more limited order sought by the first respondent and supported by the applicant at hearing. I will order that the documents, listed at (a) to (i) in [2] above, be confidential within the meaning of r 2.32(1)(b) of the Rules. 6 A fundamental issue is whether the order is necessary. Part of the consideration includes what information is already in the public domain about the proceedings. Fairfax Media Publications Pty Ltd, an interested non-party, made two main submissions in this regard: First, on an apparent speculative basis, that the substantial parts of all the documents sought to be ordered confidential were already in the public domain, by reference to the Australian Financial Review article, published on 7 June 2024, and secondly, that the concern of the parties appeared to relate to the detailed nature of the allegations and that not all of the documents identified in the proposed order would contain such details (namely, all of the documents save for the Concise Statement and the Statement of Claim and its amended form). Of course, the submission had to be made on a speculative basis given Fairfax did not have access to the documents which are the subject of the first respondent's application. I am not satisfied that the substantial content of each of the documents, identified in the proposed order, are already in the public domain. 7 The determination of necessity for the administration of justice requires a consideration of the circumstances in which the orders have been sought, and the veracity of the evidence as to necessity by the moving party. 8 The evidence before me revealed that on 28 June 2024, the parties agreed to settle this proceeding upon terms of a deed. It was the unchallenged evidence of Mr Andrew Gray, solicitor with carriage of the matter for the first respondent, that the deed imposes strict confidentiality obligations on all parties with the exception of an agreed statement to be used by the parties in response to any third-party enquires. In addition, the terms of the deed allowed for the first respondent to make this application and requires the applicant, second respondent, third respondent, fourth respondent and sixth respondent to consent to and support the application. 9 Accordingly, the undisputed evidence reveals, and I find, that the parties have agreed to the litigation settling at an early stage: There has been no exchange of pleadings. There has been no adjudication by the Court of any issue, save for on the issue of suppression (and, where the first respondent concedes the relevant, related documents to the suppression applications cannot be the subject of the order sought). The first respondent has filed an application (as well as an amended one) for strike out of the applicant's pleadings, together with supporting evidence and submissions. However, before that application could be dealt with, the matter has settled without any need for there to be any adjudication of those matters. 10 Fairfax made a number of submissions regarding the evidence. Adopting the reasoning process of Lee J in Liverpool City Council v McGraw-Hill Financial, Inc (now known as S&P Global Inc) [2018] FCA 1289 from [110] onwards, Fairfax submitted that "mere belief" that the order is necessary is insufficient and that this was in effect the extent of the evidence supportive of the application. It may be accepted that "mere belief" as to the necessity of making the order may be insufficient. However, it is my view that the circumstances referred to above and the information contained in Mr Gray's evidence, are sufficient to establish necessity and I do not accept that the evidence is akin to "mere belief". 11 I accept that the mere fact that parties to a proceeding have agreed between themselves that certain documents be kept confidential is not determinative. Furthermore, I accept, the Court will be, "most vigilant" when both sides agree to confidentiality orders (noting the citation of R v Legal Aid Board; ex parte Kaim Todner (a firm) [1999] QB 966 at 977, referred to in Liverpool above). However, care must be taken when analogising the circumstances of Liverpool and the cited cases. None of the circumstances in Liverpool nor in the cited authorities were analogous to the situation here. Liverpool concerned the settlement approval of six related representative proceedings and where confidentiality orders were sought over the heads of agreement, deeds and the settlement distribution scheme (at [112]) and certain affidavits concerning costs and the calculation of the settlement sum: at [115]. A central thread of the reasoning in Liverpool as to why there ought not be confidentiality orders was that class actions are not simply disputes as between private parties about private rights and the associated private bargain: at [104]-[107]. Accordingly, contrary to Fairfax's submission, the distinction recognised in Liverpool, supports rather than undermines, the existing authorities to referred to below, regarding the Court's recognition of an exception to granting access where it is necessary to preserve the administration of justice - namely, the resolution of a private dispute according to a private bargain early in proceedings. 12 I reject Fairfax's submission that the terms of the deed need to be before the Court in this case, given the evidence of Mr Gray and the other surrounding circumstances. In support of its submission, Fairfax pointed to the dicta in Porter v Australian Broadcasting Corporation [2021] FCA 863, where whilst orders for removal of the pleadings from the Court file were made, the Court had the terms of the deed before it. However, Fairfax's submission appears to arise from a misreading of the Porter decision. Fairfax submitted that there was a factual distinction as between in Porter and the present circumstances, given the deed of settlement was before the Court and was analysed in detail, in its terms, as to what the parties' actual intentions were and what the consequences would be if the orders were not made. However, like here, the deed, was not conditional upon the Court making the proposed confidentiality orders. As Jagot J observed, (at [101]): It is true that, as the intervening parties submitted, the releases in the deed are not conditional on the making of the consent orders. The releases operated on execution of the deed as specified in cl 4.1. As such, the settlement will not fail if proposed consent order 3 is not made. But this does not mean that the public interest in facilitating the settlement of proceedings by parties is any less acute in this case than any other. … (Emphasis added.) 13 Porter is not authority for the proposition that the entirety of the terms of settlement need to be before the Court and for it to know all "consequences" which will flow from the determination of the suppression application. 14 As observed by Mortimer J in Oldham v Capgemini Australia Pty Ltd (No 2) [2016] FCA 1101, the absence of evidence of the deed of settlement is not fatal (nor necessary) to an application for confidentiality orders, (at [30]): … the settlement of the proceeding strengthens the case to refuse access. In my opinion, and even in the absence of evidence about the precise terms of settlement of this proceeding, it would be inimical to the negotiation process which leads to the settlement of a proceeding in this Court, its discontinuance without judicial pronouncement of any kind, and the accompanying closing of the Court's file with no further proceedings in open court, for a sensitive document such as the AHRC Complaint to be released over an applicant's opposition. It would not be unusual for parties (not just applicants) in proceedings such as this to have as one of the motivations for settlement a desire to keep from the public gaze detailed factual allegations of the kind which are frequently set out in complaints made to the Commission. The Court should be mindful not to frustrate these consequences of settlement which may be in the contemplation of parties when they agree to resolve a proceeding by agreement. (Emphasis added.) 15 Further, I do not accept Fairfax's characterisation of the circumstances as being one in which the Court file is being used as a bargaining chip in settlement negotiations, and where the application has been brought by the first respondent to suppress allegations of its wrongdoing and to protect its reputation. These submissions appear to have completely ignored the agency of the female applicant in this case and her support for the application for suppression (which necessarily included primarily her pleaded allegations). There may be many reasons as to why the respective parties have agreed to resolve the proceedings, too numerous to speculate nor necessary to do so. Here, the first respondent, with the applicant's support, makes the application on the basis of the contended prejudice. 16 When addressing the critical question of whether the orders sought are "necessary to prevent prejudice to the proper administration of justice" as per s 37AG(1) of the Federal Court Act, the articulated prejudice must be considered. The first respondent submitted that the contended "prejudice" is that the integrity of the settlement will be undermined if third parties, including the media, are allowed access to the documents, contrary to the agreed terms that have been reached by the parties. 17 This Court has continually recognised that when determining the necessity of preventing prejudice to the proper administration of justice, account may be taken of the fact that the lack of access to the Court file may enhance the prospects of the parties' negotiations: Patterson (No 1) at [21], citing Oldham (No 2) per Mortimer J; Reynolds v JP Morgan Administrative Services Australia Limited (No 2) [2011] FCA 489; 193 FCR 507 at [30] per Rares J; McLaughlin v Glenn [2020] FCA 679 at [27] per Abraham J; Porter at [99]-[105] per Jagot J. 18 There is undoubtedly a very significant public interest in the settlement of proceedings, particularly at an early stage (which is an outcome the Court strives to achieve): see Patterson (No 1) at [20], citing Reynolds at [30]; Valentine v Freemantlemedia Australia Pty Ltd [2013] FCA 1293 at [13] per Mortimer J. 19 I accept that this prejudice is made out. The evidence establishes that the parties have agreed to settle at a very early stage and where the terms include, maintaining confidence as to the allegations made and the parameters of the dispute (to the extent articulated) within each of the documents identified in to (i) above. Allowing access to the documents would be subversive to the settlement reached by the parties, which is a confidential agreement: McLaughlin at [25]-[26]. I find that the parties are, by their agreement, inhibited in their ability to now comment or be able to ensure balanced or accurate reporting can be undertaken beyond the dissemination of their agreed statement. As in McLaughlin, the proceeding has settled at an early stage where the respondents' defences, substantive evidence, submissions, among other important documents, remained unfiled, such that the publication of what has been filed is likely to give an incomplete account of the dispute. As Abraham J in McLaughlin observed (at [30]): … the state of proceedings at the time of settlement were such that … It would, on any account, be an incomplete position. If access to those documents is granted in those circumstances the early settlement of the proceedings has the consequence that the respondents are likely prejudiced, or at the very least, put at a disadvantage. 20 Accordingly, the resolution will likely be undermined by third-party access and reporting on matters which all parties seek to keep confidential: McLaughlin at [27]. The contended prejudice, therefore, includes the possible frustration of the parties' attempt to achieve finality of the proceedings, unless the orders are made. As observed by Mortimer J in Valentine, at [14], the apparent freedom enjoyed by parties and their representatives to conduct negotiations and achieve a settlement, which may be on an admission, partial admission, or non-admission basis, would be inhibited if the allegations which are the subject matter of the proceedings are exposed in the public domain after resolution: Valentine at [14]. 21 It is my view that allowing third party access to the documents, in this particular circumstance, will erode public confidence in private bargains being maintained in circumstances where settlement is reached at an early stage in proceedings. 22 I note that Fairfax made a number of submissions regarding what were perceived to be distinguishing circumstances to the cases cited above, which included the fact of the relevant material which was the subject of the proposed orders in those cases, being of a personal and sensitive nature, and/or comprising information such as the Australian Human Rights Commission complaint. In addition, Fairfax submitted that in those cases there was no effective contradictor. However, despite those differences, I do not accept that the relevant jurisprudence is not of relevance and application to this case. 23 Furthermore, it is my view that the principles of open justice are not infringed in this case. The Court has not been required to adjudicate any issue arising from the material nor has admitted into evidence the identified affidavit evidence as between the parties at this early stage, save for the determination of the two suppression applications. As observed by the Full Court in Lee v Deputy Commissioner of Taxation [2023] FCAFC 22; 296 FCR 272 at [84] per Thawley, Stewart and Abraham JJ: Open justice facilitates public scrutiny of the way in which courts decide cases and enables the public to understand how the justice system works and why decisions are taken. … 24 There has been no exercise of judicial power, save for referral to mediation and the determination of the suppression application in Patterson (No 1). 25 I note two further submissions were made by Fairfax to the effect that (a) any prejudice faced by the first respondent by the release of the applicant's pleadings would be ameliorated by the release at the same time of its strike out application; and (b) that the Court had had a "choice" to give the media access to the unrestricted documents after making a purported request on 18 December 2023. 26 As to the latter, as set out in my earlier reasons, this matter was not docketed to me until May 2024. As correctly adverted to by Fairfax, Fairfax was not entitled to access as of right, there was a "choice" regarding access which would have depended on the facts at the time the request was made. 27 With respect to the former, there is a material difference between the seeking of access to pleadings when both parties have had, or will have, an opportunity to set out in detail their respective pleaded positions and when, by resolution of the proceedings, at any early stage, finality has been achieved. The Court record represents an incomplete and unbalanced account of the respective parties' positions. I do not accept that the lack of completeness or imbalance would be remedied by the release of the strike out application and associated documents. Such materials are not akin to the provision of detailed defences addressing all allegations. I am satisfied that release would undermine the settlement and finality of the proceedings. The release of the documents will necessarily invoke the need for comment which will conflict directly with the terms agreed between the parties. Accordingly, such release would frustrate the consequences of settlement and impede public confidence in the utility of early resolution prior to the close of pleadings and the achievement of finality. 28 I accept the submission of Fairfax that parties are not able to "dictate access to" Court documents and that potential reputational harm is not a basis for such an application. However, I do note, as Fairfax appears to concede, that there is not access as of right by the media nor any other person to the Court file. There are many reasons as to why suppression or non-publication orders are necessary to prevent the proper administration of justice. The assertion of broad-sweeping statements, without particular application to the present circumstances, are of limited utility. 29 Finally, Fairfax contested the applicability of the relevant authorities referred to above, in part on the basis of a broad allegation of "erosion" by "accretion" of what it considered the general principle of open justice. As previously adverted to, the principle of open justice is "a" not "the" fundamental principle of the Australian justice system: Porter at [83]. Part VAA of the Federal Court Act gives the Court power to make suppression orders and recognises that in order to do justice, there are circumstances where it may be necessary to restrict disclosure or publication of information: s 37AE of the Federal Court Act.

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