Civil Justice Review: Recommendations

Chapter 2: Facilitating The Early Resolution of Disputes Without Litigation

1. Pre-action protocols should be introduced for the purpose of setting out codes of ‘sensible conduct’ which persons in dispute are expected to follow when there is the prospect of litigation.

2. The objectives of the protocols would be:

• to specify the nature of the information required to be disclosed to enable the persons in dispute to consider an appropriate settlement

• to provide model precedent letters and forms

• to provide a time frame for the exchange of information and settlement proposals

• to require parties in dispute to endeavour to resolve the dispute without proceeding to litigation

• to limit the issues in dispute if litigation is unavoidable so as to reduce costs and delay.

3. Although information and documentation about the merits and quantum of the claim and defence would be available for use in any subsequent litigation, offers of settlement made at the pre-action stage would be on a ‘without prejudice’ basis but would be able to be disclosed, following the resolution of the dispute after the commencement of proceedings, and would be taken into account by the court in determining costs.

4. The general standards of pre-action conduct expected of persons in a dispute would be incorporated in statutory guidelines. Each person in a dispute and the legal representative of such person would be required to bring to the attention of each other or potential party to the dispute the general standards of pre-action conduct and any specific pre-action protocols applicable to the type of dispute in question (where such other person is not aware of such protocols).

5. The statutory guidelines should provide that, where a civil dispute is likely to result in litigation, prior to the commencement of any legal proceedings the parties to the dispute shall take reasonable steps, having regard to their situation and the nature of the dispute, to resolve the matter by agreement without the necessity for litigation or to clarify and narrow the issues in dispute in the event that legal proceedings are commenced. Such reasonable steps will normally be expected to include the following:

(a) The claimant shall write to the other party setting out in detail the nature of the claim and what is requested of the other party to resolve the claim, and specifying a reasonable time period for the other person to respond.

(b) The letter from the person with the claim should:

(i) give sufficient details to enable the recipient to consider and investigate the claim without extensive further information

(ii) enclose a copy of the essential documents in the possession of the claimant which the claimant relies upon

(iii) state whether court proceedings will be issued if a full response is not received within a specified reasonable period

(iv) identify and ask for a copy of any essential documents, not in the claimant’s possession, which the claimant wishes to see and which are reasonably likely to be in the possession of the recipient

(v) state (if this is so) that the claimant is willing to undertake a mediation or another method of alternative dispute resolution if the claim is not resolved

(vi) draw attention to the courts’ powers to impose sanctions for failure to comply with the pre-action protocol requirements in the event that the matter proceeds to court.

(c) The person receiving the written notification of the claim shall acknowledge receipt of the claim promptly (normally within 21 days of receiving it), specify a reasonable time within which a response will be provided and indicate what additional information, if any, is reasonably required from the claimant to enable the claim to be considered.

(d) The person receiving the written notification of the claim, or that person’s agent, shall respond to the claim within a reasonable time and provide a detailed written response specifying whether the claim is accepted and if not the detailed grounds on which the claim is rejected.

(e) The full written response to the claim should, as appropriate:

(i) indicate whether the claim is accepted and if so the steps to be taken to resolve the matter

(ii) if the claim is not accepted in full, give detailed reasons why the claim is not accepted, identifying which of the claimant’s contentions are accepted and which are disputed and the reasons why they are disputed

(iii) enclose a copy of documents requested by the claimant or explain why they are not enclosed

(iv) identify and ask for a copy of any further essential documents, not in the respondent’s possession, which the respondent wishes to see

(v) state whether the respondent is prepared to make an offer to resolve the matter and if so the terms of such offer

(vi) state whether the respondent is prepared to enter into mediation or other form of dispute resolution.

(f) In the event that the claim is not resolved or withdrawn, the parties should conduct genuine and reasonable negotiations with a view to resolving the claim economically and without court proceedings.

(g) Where a person in dispute makes an offer of compromise before any legal proceedings are commenced the court may, after the determination of the court proceedings, take that into consideration on the question of costs in any proceedings.

6. Specific pre-action protocols applicable to particular types of dispute should be developed by the proposed Civil Justice Council (see further recommendations below) in conjunction with representatives of stakeholder groups in each relevant area (eg, commercial disputes, building disputes, medical negligence, general personal injury, etc.).

7. Where a specific pre-action protocol is developed for a particular type of dispute it would be referred to the Rules Committee for approval and implementation by way of a practice note in each of the Magistrates’ Court, the County Court and the Supreme Court, with such modifications as may be appropriate in each of the three jurisdictions.

8. Except in (defined) exceptional circumstances, compliance with the requirements of the practice notes would be an expected condition precedent to the commencement of proceedings in each of the three courts. The obligation to comply with the requirements of applicable practice notes would be statutory. A person seeking to formally commence a legal proceeding should be required to certify whether the pre-action protocol requirements have been complied with, and where they have not to set out the reasons for such non compliance.

9. Because it would not be practicable for court registry staff to determine whether there had been compliance with the pre-action protocol requirements or to evaluate the adequacy of the reasons for noncompliance, the court would not have power to decline to allow proceedings to be commenced because of noncompliance. However, where the pre-action protocol requirements have not been complied with the court could, in appropriate cases, order a stay of proceedings pending compliance with such requirements.

10. The ‘exceptional’ circumstances where compliance with any pre-action protocol requirements would not be mandatory would include situations where:

• a limitation period may be about to expire and a cause of action would be statute barred if legal proceedings are not commenced immediately

• an important test case or public interest issue requires judicial determination

• there is a significant risk that a party to a dispute will suffer prejudice if legal proceedings are not commenced, in circumstances where advance notification of proceedings may result in conduct such as the dissipation of assets or destruction of evidence

• there is a reasonable basis for a person in dispute to conclude that the dispute is intractable

• the legal proceeding does not arise out of a dispute

• the parties have agreed to dispense with compliance with the requirements of the protocol.

11. Unreasonable failure to comply with an applicable protocol or the general standards of pre-action conduct should be taken into account by the court, for example in determining costs, in making orders about the procedural obligations of parties to litigation, and in the awarding of interest on damages. Unless the court orders otherwise, a person in dispute who unreasonably fails to comply with the pre-action requirements:

• would not be entitled to recover any costs at the conclusion of litigation, even if the person is successful

• would be ordered to pay the costs of the other party on an indemnity basis if unsuccessful.

12. The operation of the protocols and general standard of pre-action conduct should be monitored by the Civil Justice Council, in consultation with representatives of relevant stakeholder groups, and modified as necessary in the light of practical experience.

13. There should be an entitlement to recover costs for work done in compliance with the pre-action protocol requirements in cases which proceed to litigation. Specific pre-action protocols should attempt to specify the amount of costs recoverable, on a party–party basis, for carrying out the work covered by the protocols. As with the current Transport Accident Commission (TAC) protocols in Victoria, such costs should be either fixed (with allowance for inflation) or calculated in a determinate manner (eg, like the fixed costs payable in certain types of simple cases in England and Wales, where costs are calculated on a fixed base amount plus an additional percentage of the amount claimed). Consideration should be given to whether specific pre-action protocols should include a procedure for mandatory pre-trial offers which would be taken into account by the court when determining costs at the conclusion of any legal proceeding.

14. Where the parties to a dispute have agreed to settle the dispute before starting proceedings but have not agreed on who is to pay the costs of and incidental to the dispute or the amount to be paid, and there is no pre-action protocol which provides for such costs, any party to the dispute may apply to the court for an order:

(i) for the costs of and incidental to the dispute to be taxed or assessed, or

(ii) awarding costs to or against any party to the dispute, or

(iii) awarding costs against a person who is not a party to the dispute, if the court is satisfied that it is in the interests of justice to do so.

15. Where, taking into account the nature of the dispute and the likely means of the parties, the costs of and incidental to the dispute are relatively modest, there should be a presumption that each party to the dispute will bear its own costs. The court should have power to determine the application on the basis of written submissions from the parties, without a hearing and without having to give reasons, or refer the matter to mediation or other form of alternative dispute resolution.

Chapter 3: Improving The Standards of Conduct of Participants in Civil Litigation

16. New provisions should be enacted in respect of (a) standards of conduct in civil proceedings (b) verification of the allegations made in pleadings and (c) the overriding purpose of relevant statutory provisions and procedural rules.

16.1 New provisions should be enacted to prescribe standards of conduct in civil proceedings, and to facilitate cooperation between the participants in a civil proceeding, candour and early disclosure of relevant information, and early resolution of the dispute - including by agreement of the parties or through alternative dispute resolution processes at minimal cost to the parties. There should be sanctions and penalties for non-compliance with these overriding obligations. Such sanctions should only come into force 12 months after the obligations take effect and any application should require leave of the court.

16.2 There should be new requirements for parties and lawyers to certify or verify that allegations in pleadings have merit.

16.3 There should be an overriding provision to the effect that relevant legislation and procedural rules are to facilitate the just, efficient, timely and cost effective resolution of the real issues in dispute.

Such provisions should be along the lines of the following draft:

Section /Rule A: overriding obligation

(1) These provisions apply to the conduct or defence of any aspect of a civil proceeding, including any interlocutory proceeding, and any appeal from any order or judgment in a proceeding (‘a civil proceeding’) where such civil proceeding is in the Magistrates’ Court, the County Court, the Supreme Court or the Court of Appeal (a ‘Victorian court’), and to any alternative dispute resolution process undertaken in relation to any civil proceeding pending in a Victorian court.

(2) These provisions apply to:

(a) any person who is a party to a civil proceeding

(b) any legal practitioner or other representative acting on behalf of a party to a civil proceeding

(c) any law practice acting on behalf of a party to a civil proceeding

(d) any person providing any financial or other assistance to any party to a civil proceeding, including an insurer or a provider of funding or financial support, insofar as such person exercises any direct or indirect control or influence over the conduct of any party in a civil proceeding (‘the participants’).

(3) These provisions:

(a) do not apply to witnesses as to fact

(b) (other than subsections 4(b), (c), (f)) apply to expert witnesses.

(4) Each of the persons to whom this part applies has a paramount duty to the court to further the administration of justice. Without limiting the generality of this obligation, in all aspects of the proceeding (including any ancillary processes such as negotiation and mediation), each of the participants:

(a) shall at all times act honestly

(b) shall not make any claim or respond to any claim in the proceeding, or assist in the making of any claim or response to any claim in the proceeding, where a reasonable person would believe that the claim or response to claim is frivolous, vexatious, for a collateral purpose or does not have merit

(c) shall not take any step in the proceeding in connection with a claim or response to a claim, or assist in the taking of any step or response to any step, unless reasonably of the belief that such step is reasonably necessary to facilitate the resolution or determination of the proceeding

(d) has a duty to cooperate with the parties and the court in connection with the conduct of a civil proceeding

(e) has a duty not to engage in conduct which is misleading or deceptive, or which is likely to mislead or deceive, or knowingly aid, abet or induce any other participant to engage in conduct which is misleading or deceptive or which is likely to mislead or deceive

(f) shall use reasonable endeavours to resolve the dispute by agreement between the parties, including, in appropriate cases, through the use of alternative dispute resolution processes

(g) where the dispute is unable to be resolved by agreement, shall use reasonable endeavours to resolve such issues as may be resolved by agreement and to narrow the real issues remaining in dispute

(h) shall use reasonable endeavours to ensure that the legal and other costs incurred in connection with the proceeding are minimised and proportionate to the complexity or importance of the issues and the amount in dispute

(i) shall use reasonable endeavours to act promptly and to minimise delay

(j) has a duty to disclose, at the earliest practicable time, to each of the other relevant parties to the proceeding, the existence of all documents in their possession, custody or control of which they are aware, and which they consider are relevant to any issue in dispute in the proceeding, other than any documents the existence of which is protected from disclosure on the grounds of privilege which has not been expressly or impliedly waived, or under any other statute.

(5) Subsections 4(b) and (c) do not apply to preliminary steps, preliminary legal work or preliminary financial or other assistance for the purpose of a proper and reasonable consideration of whether a claim, proceeding or defence of a claim or proceeding or a step in a proceeding has merit.

(6) The obligations imposed by this part shall override any legal, ethical, contractual or other obligation which the person may have insofar as they are inconsistent with such obligations. The obligations in this part apply to any legal practitioner engaged on behalf of a client in connection with a civil proceeding, despite any obligation that the legal practitioner or law practice may have to act in accordance with the instructions or wishes of a client.

Penalty Provisions

(7) Provisions for penalties for breach of the overriding obligations will come into effect 12 months after the obligations take effect. Such penalties will only apply to breaches arising after that date. The delay in implementation of the penalty provisions shall not prevent the court from exercising any power it already has, including in relation to costs.

(8) Where the court is satisfied that, on the balance of probabilities, a person to whom this part applies has failed to act in accordance with the obligations imposed by this part the court may, of its own motion or on the application of any party or person with a sufficient interest, in addition to any other order that the court has power to make, make such order as the court considers in the interests of justice, including:

(a) an order that the person pay some or all of the legal or other costs or expenses of any person arising out of the failure to act in accordance with the obligations imposed by this section

(b) an order that the person compensate any person for any financial or other loss which was materially contributed to by the failure to act in accordance with the obligations imposed by this section, including an order for penalty interest in respect of any delay in the payment of any amount claimed in a civil proceeding or an order that there be no interest, or reduced interest, where there has been a failure on the part of any participant involved in the bringing of the claim

(c) an order that the person take such steps in a civil proceeding as may be reasonably necessary to remedy any problem arising out of the failure to act in accordance with the obligations imposed by this section

(d) an order that the person not be permitted to take specified steps in a civil proceeding

(e) such order as the court considers to be in the interest of any person who has been prejudiced by the failure to act in accordance with the obligations imposed by this section

(f) an order that the person pay into the Justice Fund such amount as the court considers reasonable having regard to the time spent by the court as a result of:

(i) the failure to act in accordance with the obligations imposed by this section, or

(ii) any civil claim or civil proceeding arising out of the failure to act in accordance with the obligations imposed by this section, including an application for an order under this section.

(9) Any application under section 8 by a party or person with sufficient interest may only be made with leave of the court.

(10) An application under section 8 shall be made in the court in which the proceeding is being heard or was heard and, where practicable and without limiting the discretion of the court to decide how and by whom such application should be determined, such application may be dealt with initially by the judicial officer who is most familiar with the proceeding which gave rise to the application.

(11) An application under section 8 shall be made not later than 28 days from the date of final determination of the proceeding. Where an order in respect of costs is made after the date of judgment or final determination of the proceeding the date of the making of the last of any such order shall be the date of final determination of the proceeding for the purposes of this section.

Certification Provisions

(12) Each party to a proceeding is required:

(a) to personally certify that they have read and understood the overriding obligations. Such certification must be filed when the party files its first document in the proceeding

(b) when filing any pleading (including any amendment of the pleading), to certify on the pleading, or verify on affidavit or by statutory declaration, that:

(i) as to any allegations of fact in the pleading, the deponent believes that the allegations have merit

(ii) as to any allegations of fact that the pleading denies, the deponent believes that the allegations do not have merit

(iii) as to any allegations of fact that the pleading does not admit, after reasonable inquiry the deponent does not know whether or not the allegations have merit.

(13) A determination of whether any allegation of fact has merit shall, in the case of a party, be based on a reasonable belief as to the truth of the allegation.

(14) Legal practitioners are required, when filing any statement of claim or other originating process, defence or further pleading on behalf of a party, to certify on the document that:

(a) each allegation in the document has merit

(b) each denial in the document has merit

(c) each nonadmission in the document arises out of an inability to determine the merit of the allegation.

(15) A determination as to whether an allegation has merit shall, in the case of a legal practitioner, be based on the available factual material and evidence and a reasonable view of the law.

Overriding Purpose and the Duties of the Court

(16). The overriding purpose of this Act and the rules of court, in their application to civil proceedings, is to facilitate the just, efficient, timely and cost effective resolution of the real issues in dispute by (i) the just determination of the proceeding by the court or (ii) the agreement of the parties or (iii) an alternative dispute resolution process agreed to by the parties or ordered by the court.

(17). The court must seek to give effect to the overriding purpose when it interprets or exercises any of its powers, whether derived from procedural rules or as part of its inherent, implied or statutory jurisdiction.

(18). Parties to a civil proceeding are subject to the overriding obligations in section 4 and are under a duty to the court to assist the court to further the overriding purpose.

(19). Legal practitioners or any other representatives acting on behalf of a party are subject to the overriding obligations contained in section 4 and are under a duty to the court to assist the court to further the overriding purpose and shall not by their conduct cause their clients to be put in breach of section 5 or the overriding obligations contained in section 4.

(20). The court may take into account any failure to comply with sections 18 or 19 in exercising any power, including its discretion with respect to costs.

(21). To further the overriding purpose, the court in making any order or giving any direction in a civil proceeding—

(a) shall have regard to the following objects:

(i) the just determination of the proceeding

(ii) the public interest in the early settlement of disputes by agreement between the parties

(iii) the efficient disposal of the business of the court

(iv) the efficient use of available judicial and administrative resources

(v) the timely disposal of the proceeding

(vi) dealing with the case in ways which are proportionate to:

• the amount of money involved

• the importance and complexity of the issues

• the financial position of each party.

(b) may, in addition to any other matter, have regard to the following considerations to the extent that the court thinks relevant:

(i) the extent to which the parties have complied with any pre-action procedural obligations or protocol applicable to the dispute

(ii) the extent to which the parties have used reasonable endeavours to resolve the dispute by agreement or to limit the issues in dispute

(iii) the degree of expedition with which the respective parties have approached the proceeding, including the degree to which they have been timely in their interlocutory steps

(iv) the degree to which any lack of expedition in approaching the proceeding has arisen from circumstances beyond the control of the respective parties

(v) the degree to which there has been compliance with the overriding obligations contained in sections 4, 18 and 19

(vi) the degree of injustice that may be suffered by any party as a consequence of any order or direction under consideration and

(c) should, in addition to any other matter, have regard to the objective of minimising any delay between the commencement of the civil proceeding and its listing for trial beyond that reasonably required for such interlocutory steps as are necessary for the fair and just determination of the real issues in dispute and the preparation of the case for trial.

Chapter 4: Improving Alternative Dispute Resolution

17. A wider range of ADR options should be available to the courts, including:

• early neutral evaluation

• case appraisal

• mini trial/case presentation

• the appointment of special masters

• court-annexed arbitration

• greater use of special referees to assist the court in the determination of issues or proceedings

• conciliation

• conferencing and

• hybrid ADR processes.

Some of these options will be more appropriate in the higher courts; for example, special masters and court annexed arbitration.

18. More effective use should be made of industry dispute resolution schemes. If proceedings have commenced, the dispute should not be able to be referred to an industry scheme, unless the parties agree to stay the proceedings. This would appear to be the present position under most if not all industry dispute resolution schemes.

19. While the use of collaborative law in Victoria has largely been confined to family law matters, it is a process that could be applied to all kinds of civil disputes. Collaborative law could be used in wills disputes, property disputes and other types of disputes, particularly where the parties have a relationship that they wish to continue.

20. Court conducted mediation is to be encouraged but in view of limited court and judicial resources it might be preferable for courts to deal mainly with cases where private mediation is unsuitable or unavailable, such as where:

• one of the parties is in financial hardship and/or self-represented

• the parties are unable to agree on a choice of mediator

• there has already been an unsuccessful external mediation

• the case is of public interest or is highly complex and could benefit from a mediator with court authority.

21. If a judge has conducted a mediation that fails to resolve the matter there should be a presumption against that judge presiding over the hearing of the matter. However, if the parties consent, the judge should be able to hear the matter.

22. There should be educational programs and training for the judiciary and legal profession about court conducted mediation.

Binding and Non-Binding ADR

23. The courts should have power to order non-binding ADR, with or without the parties’ consent.

24. In appropriate circumstances, it may be desirable for a person who would otherwise conduct an ADR process to be appointed as a special referee. The reference might be limited to particular questions of fact or law. The special referee could seek to resolve, albeit on a provisional basis, all or part of the dispute, using such processes as are (a) determined by the court, or (b) agreed between the parties. This could include procedures analogous to arbitration even in the absence of consent of the parties. The court should have the power to control the procedures governing the reference.  

The special referee would make a provisional determination, in the form of a report to the court, if a settlement agreement is not reached between the parties. The court would retain responsibility for determining the outcome of the case (in the absence of a resolution agreed to by the parties) without being required to conduct an evidentiary hearing before the court on all issues in dispute. The parties would retain the right to argue before the court against adoption of the referee’s findings. Existing appeal rights from the final orders of the court would be retained.

Resources

25. The courts should be adequately resourced to appoint or designate persons with responsibility to recommend suitable forms of ADR and to assist parties in arranging ADR providers and facilities. There should also be a panel of suitably qualified and experienced dispute resolution practitioners available to undertake ADR processes.

Empirical data

26. There is a lack of empirical data on the effectiveness of court-ordered mediation in Victoria, including the cost effectiveness. There is a need for more research on the effectiveness, including the cost effectiveness, of mediation/ADR in Victoria. The Department of Justice’s Civil Law Policy Unit is undertaking a review of the effectiveness, including the cost effectiveness, of mediation in the higher courts. A review of the Magistrates’ Court mediation program would also be useful. The Civil Justice Council should be responsible for the ongoing review of ADR processes in all three courts.

27. Reports should be required to be submitted by the parties to the court at the conclusion of any ADR process. Such reports should also provide an assessment of the person conducting the ADR process.

Education

28. There should be more education of lawyers, judicial officers and court officers about the different types of ADR and in what circumstances different ADR processes will be appropriate. The Judicial College of Victoria and the Legal Services Commissioner could provide education programs regarding the ADR processes.

Chapter 5: Case Management

Judicial Power

29. There should be a general statutory provision to clearly provide for judicial power/discretion to make appropriate orders and impose reasonable limits, restrictions or conditions in respect of the conduct of any aspect of the proceeding as the court considers necessary or appropriate in the interests of the administration of justice, and in the public interest, having regard to the overriding purpose. Such provision should make it clear that the overriding purpose is to prevail, to the extent of any inconsistency, over principles of procedural fairness derived from the common law.

The proposed statutory provision is intended to be of general application and specifically applicable to various proposals including case management, expert evidence, discovery, ADR, self-represented litigants, etc.

Rule making power

30. The commission suggests that the courts should consider utilising the full extent of their rule making powers to implement the reforms recommended by the commission and to encourage cultural change. There may be a need to amend the rule making powers of the courts so as to make it clear that the courts have clear and express power to make such rules as may be necessary or appropriate (a) to further the overriding purpose and (b) to  implement, by way of rules, a number of the reform recommendations of the commission and in particular many of those relating to: (a) pre-action protocols (b) case management, (c) alternative dispute resolution, (d) pre-trial oral examinations, (e) self represented and vexatious litigants, (f) disclosure and discovery, (g) expert evidence, and (h) costs. However, a number of the commission’s recommendations may need to be implemented by statute, particularly those that propose changes in the substantive law rather than changes in practice and procedure.

The rule making power is discussed further in Chapter 12.

Active judicial case management

31. There should be more clearly delineated and specific powers to actively case manage. A rule or provision defining what is ‘active case management’ could be drafted as follows:

Active case management includes:

(a) encouraging the parties to co-operate with each other in the conduct of proceedings;

(b) identifying the issues at an early stage;

(c) deciding promptly which issues need full investigation and a hearing and accordingly disposing summarily of the others;

(d) deciding the order in which the issues are to be resolved;

(e) encouraging the parties to use an alternative dispute resolution procedure if the court considers that appropriate and facilitating the use of such procedure;

(f) helping the parties to settle the whole or part of the case;

(g) fixing timetables or otherwise controlling the progress of the case;

(h) considering whether the likely benefits of taking a particular step justify the cost of taking it;

(i) dealing with as many aspects of the case as it can on the same occasion;

(j) dealing with the case without the parties needing to attend court;

(k) making use of technology;

(l) giving directions to ensure that the hearing of a case proceeds quickly and efficiently;

(m) limiting the time for the hearing or other part of a case, including at the hearing the number of witnesses and the time for the examination or cross-examination of a witness.

32. The courts should have an express power to call witnesses in civil proceedings without the parties’ consent. This power could be used when there is no other reasonably practicable alternative means of achieving justice between the parties. A draft provision is as follows:

The court may, at the request of a party or of its own initiative order a person to appear to give evidence as a witness in a proceeding if the court is of the view that (a) such evidence is necessary or desirable in relation to a matter in dispute and (b) there is no reasonably practicable alternative means of determining such matter in dispute.

The imposition of limits on the conduct of the proceeding, trial time, interlocutory hearings and submissions

33. There should be more clearly delineated and specific powers to impose limits on trial time, length of oral submissions and length of written submissions etc. Set out below is a draft provision that specifies the types of directions or orders the court could make as to the conduct of a hearing:

Section/Rule X: ‘Directions as to conduct of hearing’

(1) The court may, by order, give directions as to the conduct of any hearing, including directions as to the order  in which evidence is to be given and addresses made.

(2) The court may, by order, give directions as to the order in which questions of fact are to be tried.

(3) The list of directions in this section is in addition to any powers given to the court by any other rule or practice direction or by any other enactment or any powers it may otherwise have.

(4) Without limiting subsections (1) and (2), the court may, by order, give any of the following directions at any time before or during a hearing:

(a) limiting the time that may be taken in the examination, cross-examination or re-examination of a witness,

(b) not allowing cross examination of a particular witness,

(c) limiting the number of witnesses (including expert witnesses) that a party may call,

(d) limiting the number of documents that a party may tender in evidence,

(e) limiting the time that may be taken in making any oral submissions,

(f) that all or any part of any submissions be in writing,

(g) limiting the length of written submissions,

(h) limiting the time that may be taken by a party in presenting his or her case,

(i) limiting the time that may be taken by the hearing,

(j) with respect to the place, time and mode of trial,

(k) with respect to the giving of evidence at the hearing including whether evidence of witnesses in chief shall be given orally or by affidavit, or both,

(l) with respect to costs, including the proportions in which the parties are to bear any costs,

(m) with respect to the filing and exchange of signed statements of evidence of intended witnesses and their use in evidence at the hearing,

(n) with respect to the taking of evidence and receipt of submissions by video link, or audio link, or electronic communication, or such other means as the court considers appropriate,

(o) that evidence of a particular fact or facts be given at the hearing:

I by statement on oath upon information and belief,

II by production of documents or entries in books,

III by copies of documents or entries; or

IV otherwise as the court directs,

(p) that an agreed bundle of documents be prepared by the parties,

(q) that evidence in relation to a particular matter not be presented by a party, or

(r) that evidence of a particular kind not be presented by a party.

(5) At any time, the court may, by order, direct a solicitor or barrister for a party to give to the party and/or the court a memorandum stating:

(a) the estimated length of the trial, and the estimated costs and disbursements, and

(b) the estimated costs that the party would have to pay to any other party if they were unsuccessful at trial.

34. There should be more clearly delineated and specific powers to impose limits on the conduct of pre-trial procedures. Set out below is a draft provision that specifies the types of directions orders the court could make including as to pre-trial procedures.

Section/Rule Y: ‘Directions as to practice and procedure generally’

(1) The court may, by order, give such directions as it thinks fit (whether or not inconsistent with rules of court) to facilitate the just, efficient, timely and cost effective resolution of the real issues in dispute.

(2) The list of directions in this section is in addition to any powers given to the court by any other rule or practice direction or by any other enactment or any powers it may otherwise have.

(3) Without prejudice to the generality of subsection (1) the Court may give such directions or make such orders as it considers appropriate with respect to:

(a) discovery and inspection of documents, including the filing of lists of documents; either generally or with respect to specific matters;

(b) interrogatories;

(c) inspections of real or personal property;

(d) admissions of fact or admissibility of documents;

(e) the filing of pleadings and the standing of affidavits as pleadings;

(f) the defining of the issues by pleadings or otherwise; including requiring the parties, or their legal practitioners, to exchange memoranda in order to clarify questions;

(g) the provision of any essential particulars;

(h) the joinder of parties;

(i) the mode and sufficiency of service;

(j) amendments;

(k) counterclaims;

(l) the filing of affidavits;

(m) the provision of evidence in support of any application;

(n) a timetable for any matters to be dealt with, including a timetable for the conduct of any hearing;

(o) the filing of written submissions;

(p) costs;

(q) the use of assisted dispute resolution (including mediation) to assist in the conduct and resolution of all or part of the proceeding;

(r) the attendance of parties and/or legal practitioners before a Registrar/Master for a conference with a view to satisfying the Registrar/Master that all reasonable steps to achieve a negotiated outcome of the proceedings have been taken, or otherwise clarifying the real issues in dispute so that appropriate directions may be made for the disposition of the matter, or otherwise to shorten the time taken in preparation for and at the trial;

(s) the attendance of parties and/or legal practitioners at a case management conference with a Judge or Registrar/Master to consider the most economic and efficient means of bringing the proceedings to trial and of conducting the trial, at which conference the Judge or Registrar/Master may give further directions;

(t) the taking of specified steps in relation to the proceedings;

(u) the time within which specified steps in the proceedings must be completed;

(v) the conduct of proceedings.

(4) If a party to whom such a direction has been given or against whom an order is made under subsection (1) or (2) fails to comply with the direction or order, the court may, by order, do any one or more of the following:

(a) dismiss the proceedings, whether generally, in relation to a particular cause of action or in relation to the whole or part of a particular claim,

(b) strike out or limit any claim made by a plaintiff,

(c) strike out or limit any defence or part of a defence filed by a defendant, and give judgment accordingly,

(d) strike out or amend any document filed by the party, either in whole or in part,

(e) strike out, disallow or reject any evidence that the party has adduced or seeks to adduce,

(f) direct the party to pay the whole or part of the costs of another party,

(g) make such other order or give such other direction as it considers appropriate.

(5) Subsection (3) does not limit any other power the court may have to take action of the kind referred to in that subsection or to take any other action that the court is empowered to take in relation to a failure to comply with a direction given or order made by the court.

(6) The Court may revoke or vary any direction or order made under subsection (1) or (3).

Methods to enhance party compliance with procedural requirements and directions

35. The proposed Section Y(4), above, expressly permits the court to impose costs and other sanctions for failure to comply with court directions or orders.

Expansion of Individual Docket Systems

36. The Commission considers that there is merit in giving further consideration to the extension of the individual docket system in the Supreme and County Courts.

The courts should retain a consultant or consultants to examine the feasibility of implementing a docket system in the County and Supreme Courts. If the individual docket system is extended, the courts should determine the method of implementation.

Any changes should be monitored or evaluated by the Chief Justice in the Supreme Court, the Chief Judge in the County Court and the proposed Civil Justice Council.

Greater use of telephone directions hearings and technology

37. The County Court could consider adopting the Supreme Court’s approach to e-litigation. The Magistrates’ Court may wish to consider adopting the Supreme Court’s approach to e-litigation in more complex cases, including where there is a substantial portion of the discoverable material in electronic form.

38. There could be more use of telephone directions hearings to save the parties the time and the cost involved of legal practitioners attending a directions hearing. Email directions hearings and internet online messaging systems should also be considered, subject to appropriate security arrangements.

The use of case conferences and listing conferences as an alternative to directions hearings

39. Case management conferences could be used as an alternative to directions hearings.

Earlier and more determinate trial dates

40. Further consideration should be given to means by which trial dates could be set earlier than at present. Once a trial date is set, the courts should ensure that there are sufficient judicial resources available to hear the trial.

Reform of procedures for the earlier determination of disputes, including the summary disposal of unmeritorious claims and defences

41. The test for summary judgment in Victoria should be changed to provide that summary judgment can be obtained if the other party has ‘no real prospect of success.’

42. There should be in the rules of court a statement of an explicit case management objective that the Court should decide promptly which issues need full investigation and trial and accordingly dispose summarily of the others.

43. There should be a discretion for the court to initiate the summary judgment procedure of its own motion where early disposal of a proceeding appears desirable.

44. There should be a restatement and simplification of the rule. In particular, it should be made clear that summary judgment may be obtained by both plaintiffs and defendants and the rules should be based on the same test. The Magistrates’ Court rule should be extended to permit a defendant to apply for summary dismissal of the proceeding.

45. The limitations on categories of cases that are excluded from the procedure in the Supreme Court and the Magistrates’ Court should be removed.

46. The court should retain a residual discretion to allow a matter to proceed to trial even if the applicable test is satisfied.

Methods for controlling interlocutory disputes

47. There should be additional measures to reduce the interlocutory steps in proceedings. This may be facilitated by:

• requiring parties to confer and encouraging parties seek to reach agreement on an issue before making an interlocutory application;

• more determinate costs consequences for unnecessary as well as unsuccessful applications;

• requiring certification of the merits of applications.

The Civil Justice Council could develop guidelines and education programs on appropriate ways of dealing with interlocutory disputes.

Power to make decisions without giving reasons

48. The Commission has considered whether, in certain circumstances, the courts should have the power to make decisions without giving reasons, unless the parties request reasons. A requirement that the court give reasons for decisions slows down the process and causes delay. Juries are not required to give reasons for their decisions. If the parties request reasons, a request should be made within a reasonable time.

The Commission is not presently persuaded that any general dispensation of the requirement to give reasons for decisions, particularly final decisions determining the rights of parties, is in the interests of the administration of justice, although it would no doubt expedite determinations. However, there are no doubt many situations where parties could be encouraged to consent to dispensing with reasons, particularly in relation to interlocutory orders and judgments. Also, there is a strong case for allowing short form reasons in some circumstances, such as interlocutory matters including leave to appeal applications.

This matter requires further detailed consideration and should be a matter for review by the proposed Civil Justice Council.

Making decisions on the papers

49. At present, in a number of instances, decisions may be made ‘on the papers’ without the necessity for oral argument. Giving decisions on the papers could reduce costs and delay.

The Commission believes that making decisions on the papers in appropriate cases should be encouraged as a means of reducing costs and delay. However, consideration should be given as to whether there should be a requirement for consent of the parties or criteria for the circumstances in which an oral hearing may be dispensed with. These matters should be examined by the proposed Civil Justice Council.

Chapter 6: Getting To The Truth Earlier and Easier

Pre-Trial Oral Examinations

50. A new pre-trial procedure should be introduced to enable parties to a civil proceeding to examine on oath or affirmation any person who has information relevant to the matters in dispute in the proceeding.

Objects of the procedure

51. The provisions relating to pre-trial examinations should incorporate an objects clause that states their primary purpose is not preparation for trial, but rather:

• to facilitate the pre-trial disclosure of relevant information

• to assist the parties to obtain a better understanding of, and therefore to limit, the real issues in dispute

• to facilitate settlement

• to restrict or eliminate the need to call or test particular evidence if the matter proceeds to hearing.

52. The provisions should make it clear that requiring a person to submit to a pre-trial examination should be regarded as a step of last resort, to be taken only when less formal, cooperative means of obtaining information from relevant persons have failed. The requirement that the parties seek to exchange information in a non-adversarial manner prior to initiating a pre-trial examination should be expressed in a manner conformable with the overriding obligation.

Nature of the examination procedure

53. The parties should be entitled, with leave of the court, to examine any person on oath or affirmation. There should be a presumption in favour of granting such leave, subject to the exercise of judicial control to limit costs, prevent abuse and ensure appropriate safeguards are implemented. The court would have overriding power to limit the use of pre-trial examinations in a particular case.

54. The procedure should be available, with leave of the court, at any stage of the proceeding before the commencement of the trial, including in circumstances where the matter has been referred to an ADR process.

Details of the examination procedure

55. The application for leave to conduct an examination, together with a notice of examination, should be served on the person to be examined and all other parties to the litigation. The notice should contain details of:

• the time, place and expected duration of the pre-trial examination; where practicable, the examination should be held at a time and a place convenient to the person to be examined

• the reasonable travel and out-of-pocket expenses to which the person to be examined is entitled (to be borne, at least initially, by the litigant initiating the examination)

• the expected subject matter of the examination, in general terms

• all documents that the examinee will be required to produce at the examination

• where the person to be examined is a corporation, the proposed framework for agreeing on the individual(s) to be examined, and notice of the duty of such individual(s) to inform themselves as to relevant matters prior to their examination (see below, recommendation 59)

• the legal rights of the person to be examined, including the right to appear at the hearing of the application for leave, the right to be legally represented at the examination, the right to object to answer questions if they are misleading, offensive, repetitive or call for the disclosure of information which is privileged and

• the legal obligations of the person to be examined, including those arising under the overriding obligation if the person is a person to whom such obligations are applicable.

56. The court should be empowered to give such directions as it thinks appropriate as to the conduct of pre-trial examinations in a particular case at any time, either of its own motion or on application of one of the parties or an examinee. Such directions could include:

• limiting the number of examinations able to be initiated by a party

• limiting the duration of an examination, or examinations

• precluding the examination of a named person

• precluding a particular litigant from participating in a specific examination

• restricting the subject matter of a particular examination

• setting the time or place at which particular examinations must take place

• an order that specified persons be examined concurrently.

57. The court may appoint an independent legal practitioner to be present at the examination, to administer the oath and to control the conduct of the examination.

58. A litigant should be precluded from examining a natural person more than once, unless leave of the court is given or the examinee consents.

59. Where the person to be examined is a corporation, the examining party and the corporation must endeavour to reach agreement as to the person or persons most appropriate to be examined on the matters specified in the notice. Where agreement cannot be reached, the court should appoint a person or persons to be examined on the corporation’s behalf. A person being examined on behalf of a corporation should be under an obligation to inform him or herself as to the matters specified in the notice prior to the examination (subject to any division of responsibilities between examinees, as agreed or directed by the court).

60. Unless the parties otherwise agree, the litigant who initiates an examination should be responsible for making appropriate arrangements with respect to:

• a suitable venue for the examination

• the time and date of the examination

• the travel and out-of-pocket expenses of the examinee

• ensuring that the examination is recorded, and that a record of the examination is served on all parties in an appropriate form. Normally, it would be expected that a video recording, with sound, would be made of the examination.

61. The provisions should require all participants in a pre-trial examination, including the parties, their legal representatives and the examinee, to endeavour, in good faith, to:

• minimise the amount of time required for the examination

• act in a collaborative manner, and minimise adversarial conduct

• avoid needless formalities

• avoid repetition and other oppressive behaviour

• confine the examination to matters that are relevant to the issue in dispute.

These requirements should be expressed in terms conformable with the overriding obligation.

62. The parties should be permitted to waive or modify any requirement in relation to pre-trial examinations by express agreement.

63. All parties to the action should be permitted to be present and/or represented at the examination, and to ask questions of the examinee.

64. Examinees should be required to answer all questions put to them while under examination, consistent with the overriding obligation. However, examinees should be protected against the disclosure or future use of self-incriminating information revealed in response to a question. Examinees should be permitted to refuse to answer questions which would otherwise result in the disclosure of information that is protected by legal professional privilege.

65. Examinations should be informal and the rules of evidence should not apply. There would, therefore, be no relevant distinction between examination and cross-examination. Examinees should be permitted to refresh their memory for the purpose of the examination. Objections to particular questions asked during the course of an examination should be noted on the record for determination by the court in the event that the answer is sought to be introduced into evidence. No objection should be permitted as to the form of questions, except where a question is misleading or offensive.

66. The court should consider whether it can facilitate the provision of urgent telephone directions as to the conduct of an examination on request. This could be done either through the judge presiding over the proceeding (if one has been allocated) or through any other officer of the court, such as a registrar or master, empowered to give directions. If this is impracticable, provision should be made for the adjournment of examinations for the purposes of obtaining directions. This may give rise to an order for costs.

67. Sanctions in respect of obstructive, repetitive, unreasonable or oppressive examination conduct should be able to be imposed on all participants in the examination process, including the parties, their legal representatives and the examinee. Sanctions should include costs orders, and such other orders as the court considers appropriate.

68. Interrogatories should not be permitted to be served on a person who has been the subject of an examination by a litigant who initiated or participated in that examination, unless the court gives leave.

Examinations prior to the commencement of legal proceedings

69. Prospective litigants should be permitted to conduct examinations prior to commencing proceedings, but only with leave of the court.

Use of information obtained at examination

70. Information obtained through a pre-trial examination should be able to be used at trial in four circumstances:

• to impeach the testimony of a witness who has provided evidence at trial that is inconsistent with information he or she provided under examination (that is, as evidence of a prior inconsistent statement)

• where the examinee has died, or become unfit to give evidence, or where it is impracticable to secure his or her presence at trial

• where all parties to the litigation consent

• where the court gives leave.

71. Where information comprising part of the transcript of an examination is admitted on the application of one of the parties, any other party can seek to have admitted any other part of the transcript.

Costs

72. The reasonable costs incurred in preparation for and conduct of examinations, subject to the discretion of the court, should be recoverable as costs of the proceeding. However, there should be a presumption that each litigant is limited to recovering the costs of engaging one legal practitioner per examination. The Costs Council should seek to develop a scale of fixed costs for the conduct of examinations.

73. Examinees should be entitled to recovery of their travel and out-of-pocket expenses, for example, loss of earnings, directly related to their attendance at the examination loss of earnings.

Application

74. The provisions in respect of examinations should, at least initially, be applicable only to proceedings in the Supreme and County Courts.

Role of the Civil Justice Council

75. The proposed Civil Justice Council should, in conjunction with the courts, the Law Institute and the Bar Council:

• develop a general code of conduct in respect of examination conduct

• develop codes of practice to govern the use of pre-trial examinations in particular litigation contexts

• oversee the establishment of education and training programs to assist practitioners to develop good examination practices

• review the provisions relating to pre-trial examinations with a view to assessing their effectiveness and costs consequences, and considering possible changes to the existing scheme. The council should also consider and make recommendations about whether pre-trial examinations should be permissible in matters within the jurisdiction of the Magistrates’ Court and, if so, whether any modifications to the general scheme are required in relation to such matters.

76. There should be a statutory provision making it clear that relevant information may be provided in connection with litigation, prior to trial, notwithstanding any confidentiality constraint that might otherwise prevent the disclosure or use of such information. A draft provision is as follows:

(1) Subject to (2) and (5), a person in possession of information which is or may be relevant to an issue which has arisen or may arise in a civil proceeding pending in a court in Victoria may disclose such information

(a) to a court in Victoria in which such proceeding is pending or

(b) to a legal practitioner acting for a party in such proceeding, despite any express or implied confidentiality obligation that may otherwise prohibit such disclosure.

(2) Disclosure of information that may otherwise be prohibited from disclosure because of any express or implied confidentiality obligation is permissible under this section only where the disclosure is made:

(a) solely for the purpose of the proper preparation and conduct of the civil proceeding pending in a court in Victoria (‘the purpose’)

(b) in circumstances where the legal practitioner to whom such disclosure is made agrees to receive such information solely for the purpose.

(3) Where disclosure is made in accordance with the requirements of (2), neither the person who disclosed the information nor the legal practitioner to whom such information was disclosed shall be liable for such disclosure at law or in equity in any proceeding for damages or other relief.

(4) This section does not limit the operation of any other law permitting disclosure of information for the purpose of legal proceedings in a court in Victoria.

(5) This section does not apply in respect of any non disclosure obligation arising under any statute which makes it an offence to disclose information.

77. For the purpose of facilitating disclosure it is proposed that there be a new statutory provision entitling a party to apply to the court for the purpose of issuing a notice, similar to a subpoena, to be served on the person with relevant information prior to trial. The notice would specify the nature of the information sought to be obtained and the proposed time and place for conferring with such person, ex parte, to ascertain relevant information. In the event that the person served with the notice (or some other person claiming to have an interest) does not object to the proposed conference it may proceed at a time and place agreed between the legal practitioner seeking the information and the person on whom the notice is served.

78. In the event that the person on whom the notice is served (or some other person claiming to have an interest) objects to the proposed conference (other than an objection as to the proposed date or location) the legal practitioner seeking to obtain information shall: (a) serve a copy of the notice on each of the other parties to the proceedings and (b) apply to the court for leave to proceed with the proposed conference. At the hearing of the application for leave (i) each of the parties to the proceedings, (ii) the person on whom the notice was served, and (iii) any other person who the court considers has a sufficient interest, may appear. The court may refuse the application for leave or grant leave on such terms and conditions as the court considers appropriate. A draft provision is as follows:

Obtaining Information and Documents

(1) If a party to a proceeding believes on reasonable grounds that a person:

(a) has information or documents relevant to the proceeding; or

(b) is capable of giving evidence that is relevant to the proceeding;

the party may, by written notice issued by the [Registry of the] Court and given to the person, require the person:

(i) to give the information to the party at the time and place specified in the notice; or

(ii) to produce the documents to the party within the time, and in the manner, specified in the notice; or

(iii) to attend before the party at the time and place specified in the notice, and answer questions relevant to the proceeding.

(2) Party includes the legal representative of a party.

(3) At the request of a party the [Registry of the] Court shall issue a notice unless there are reasonable grounds for the belief that the notice is frivolous, vexatious or otherwise an abuse of the court’s process.

(4) If (a) the person who is given the notice notifies the party issuing the notice that he or she objects to giving the information or producing the documents or attending to answer questions, or (b) the party issuing the notice becomes aware that some other person claiming to have an interest objects to the disclosure of information or the production of documents, then the party shall, if the party intends to proceed to seek the information or documents, (a) provide a copy of the notice to each of the other parties to the proceeding and (b) apply to the court for leave to proceed with the steps proposed in the notice or an order that the person given the notice attend a pre-trial oral examination.

(5) In determining an application for leave under (4) the court may (a) refuse leave, or (b) make such orders as the court considers appropriate, on such conditions as the court considers reasonable, to require the person to give information, produce documents or attend to answer questions.

79. A person on whom a notice is served shall be entitled to receive from the party seeking the information payment in respect of (a) any loss of income and (b) reasonable travel, accommodation and other out-of-pocket expenses. Subject to the discretion of the court, such amounts shall be costs in the cause.

Discovery of documents

80. The test for determining whether a document must be discovered should be narrowed. Discovery should be limited to ‘documents directly relevant to any issue in dispute’.

81. Discovery should continue to be available as of right subject to any directions of the court.

82. Parties should be required to seek to reach agreement on discovery issues and to narrow any issues in a discovery dispute before making an interlocutory application.

83. In order to reduce costs and delays arising out of discovery of documents the court should have the discretion to order (on such terms including as to confidentiality or restricted access, as the court considers appropriate) a party to provide any other party (or an appropriately qualified independent person nominated by the other party and approved by the court) with access to all documents in the first party’s possession, custody or control that fall within a general category or general description (regardless of whether some such documents are not relevant to the issues in dispute in the proceedings or do not fall within the description of documents that may be the subject of an order for discovery) where:

(a) the documents are able to be identified by general description or fall within a category of documents where such category or description is approved by the court

(b) the documents are able to be identified and located without an unreasonable burden or unreasonable cost to the first party;

(c) the costs to the first party of differentiating documents within such general category or description which are (i) relevant or (ii) irrelevant to the issues in dispute between the parties are in the opinion of the court excessive or disproportionate
 

(d) access to irrelevant documents is not likely to give rise to any substantial prejudice to the first party which is not able to be prevented by way of court order or agreement between the parties

(e) access is to facilitate the identification of documents for the purpose of obtaining discovery of such identified documents in the proceedings.

Where an order is made for access for inspection pursuant to this provision, the other party shall not be permitted to copy, reproduce, make a record of, photograph or otherwise use, either in connection with the proceedings or in any other way, documents or information examined as a result of such inspection except to the extent that would allow the other party to describe or identify an examined document for the purpose of obtaining discovery of such identified document in the proceedings.

There is a need to make provision for any disclosure under this provision to be without prejudice to an entitlement to subsequently claim privilege over any information that has been inspected and is claimed to be privileged. In other words, disclosure pursuant to this provision does not give rise to waiver of privilege. The proposed protection against waiver of privilege should also extend to any document obtained as a result of a chain of inquiry arising out of the interim disclosure of documents.

The proposed Civil Justice Council should monitor the use and effectiveness of interim inspection orders.

84. The rules of court should be amended to provide that in appropriate cases the court may appoint a special master to manage discovery. A special master should be a judicial officer (of a lower tier than a judge) or a senior legal practitioner who will actively case manage the discovery aspect of a proceeding. The special master may make directions, give rulings and determine applications.

The costs of any externally appointed special master should be at the discretion of the court and, on an interim basis, may be ordered to be costs in the cause.

85. The court should have broad and express discretion in respect of disclosure. A draft provision is as follows:

The court may make any order in relation to disclosure it considers necessary or appropriate, including to

(a) relieve a party from the obligation to provide discovery

(b) limit the obligation of discovery to:

(i) classes of documents as specified by the court

(ii) documents relevant to one or more specified matter(s) in dispute

(c) order that discovery occur in separate stages

(d) require discovery of specified classes of documents prior to the close of pleadings

(e) relieve a party from the obligation to provide discovery of

(i) documents that have been filed in the action

(ii) communications between the parties’ lawyers or notes of such communications

(iii) correspondence between a party and the party’s lawyer or notes of oral communications between a party and

the party’s lawyer;

(iv) opinions of counsel

(v) copies of documents that have been disclosed or are not required to be disclosed.

(f) expand a party’s obligation to provide discovery

(g) modify or regulate discovery of documents in some other way

(h) order that a list of documents be indexed or arranged in a particular way

(i) require discovery to be provided by a certain time

(j) relieve a party of the obligation to provide an affidavit verifying a list of documents

(k) make orders as to which parties are to be given documents by any specified party

(l) require the party discovering documents to:

(i) provide facilities (including copying and computerised facilities) for the inspection and copying of the documents

(ii) make available a person who is able to explain the way the documents are arranged and help locate and identify particular documents or classes of documents

(m) make any other direction that the court considers appropriate.

86. Parties should be required to disclose the identity of an insurer or litigation funder that exercises control or influence over the conduct of the insured or assisted party in the course of the proceeding. The court should have discretion to order disclosure of a party’s insurance policy or funding arrangement if it thinks such disclosure is appropriate.

87. The court should be given discretion to require the disclosure of all lists and indexes (including drafts) of documents in a party’s possession, custody or control, even if such lists and indexes may be privileged, but only to the extent that those lists and indexes contain ‘objective’ information about the documents encompassed by the lists, including information such as date, subject matter, author, recipient, etc.

88. There should be legislative powers for courts to order the creation of document repositories to be used by parties in multiparty litigation.

89. The court should have broad and express discretion to deal with discovery default. A draft provision is as follows:

Where the court finds that there has been (a) a failure to comply with discovery obligations or orders of the court in relation to discovery or (b) conduct intended to delay, frustrate or avoid discovery of discoverable documents (‘discovery default’), the court may make such orders or directions as it considers appropriate, including:

(a) for the purpose of proceedings for contempt of court

(b) orders for costs, including indemnity cost orders against any party or lawyer who is responsible for, who aids and abets any discovery default

(c) in respect of compensation for financial or other loss arising out of the discovery default

(d) for adjournment of the proceedings with costs of that adjournment to be borne by the person responsible for the need to adjourn the proceedings

(e) to revoke or suspend the right to initiate or continue an examination for discovery

(f) for the purpose of preventing a party from taking steps in the proceeding

(g) in respect of any adverse inference arising from the discovery default

(h) in respect of facts taken as established for the purposes of litigation

(i) for the purpose of compelling any person to give evidence, including by way of affidavit, in connection with the discovery default

(j) for the purpose of prohibiting or limiting the use of documents in evidence

(k) for the purpose of dismissing any part of the claim or defence of a party responsible for the discovery default

(l) in respect of disciplinary action against any lawyer who is responsible for, who aids and abets any discovery default.

Unless the court orders otherwise, any party may cross-examine or seek leave to conduct an oral examination of the deponent of an affidavit of documents prepared by or on behalf of any other party if there is a reasonable basis for the belief that the other party may be misinterpreting its discovery obligations or failing to disclose discoverable documents.

90. In order to reduce the costs of discovery, the court should have discretion to make orders limiting the costs able to be (a) charged by a law practice to a client or (b) recovered by a party from another party, to costs which represent the actual cost to the law practice of carrying out such work as may be necessary in relation to discovery (with a reasonable allowance for overheads but excluding a mark up or profit component being added to such actual costs) or otherwise as the court sees fit.

91. Provision should be made for limitation on the disclosure of copies of documents.

92. A short plain English explanation of disclosure obligations should be prepared by the Legal Services Commissioner (or other appropriate entity). This should be provided to the parties and circulated to employees or agents who are asked to assist in the discovery process.

Chapter 7: Changing The Role Of Experts
 

93. Victoria should adopt reforms based on the recently introduced NSW expert evidence provisions. This would enhance the court’s control over the provision of expert evidence. The court’s powers would be discretionary. Reforms based on the NSW provisions should: (a) be subject to certain specific modifications; (b) exclude those provisions where there is already a substantially equivalent provision in Victoria; and (c) be subject to retaining certain specific Victorian provisions.

The provisions should apply in the Supreme, County and Magistrates’ Courts. In particular the following provisions should be implemented:

93.1 A purposes clause, to ensure the court has control over the giving of expert evidence, to restrict expert evidence to that which is reasonably required, to avoid unnecessary costs associated with retaining experts, to enable a single expert to be engaged by the parties or appointed by the court and to declare the duty of an expert witness. A draft provision is as follows:

The main purposes of this order are as follows:

(a) to ensure that the court has control over the giving of expert evidence

(b) to restrict expert evidence in proceedings to that which is reasonably required to resolve the proceedings

(c) to avoid unnecessary costs associated with parties to proceedings retaining different experts

(d) if it is practicable to do so without compromising the interests of justice, to enable expert evidence to be given on an issue in proceedings by a single expert engaged by the parties or appointed by the court

(e) if it is necessary to do so to ensure a fair trial of proceedings, to allow for more than one expert (but no more than are necessary) to give evidence on an issue in the proceedings

(f) to declare the duty of an expert witness in relation to the court and the parties to proceedings.

93.2 A requirement that the parties seek directions before calling expert witnesses, as follows:

(1) Any party:

(a) intending to adduce expert evidence at trial

or

(b) to whom it becomes apparent that he or she, or any other party, may adduce expert evidence at trial, must promptly seek directions from the court in that regard.

(2) Directions under this rule may be sought at any directions hearing or case management conference or, if no such hearing or conference has been fixed or is imminent, by notice of motion or pursuant to liberty to restore.

(3) Unless the court otherwise orders, expert evidence may not be adduced at trial:

(a) unless directions have been sought in accordance with this rule

(b) if any such directions have been given by the court, otherwise than in accordance with those directions.

In NSW this rule (r 31.19) does not apply to proceedings involving a professional negligence claim. This exclusion may not be appropriate in Victoria.

93.3 A broad and express discretion to give directions in relation to the use of expert evidence, in the following terms:

(1) Without limiting its other powers to give directions, the court may at any time give such directions as it considers appropriate in relation to the use of expert evidence in proceedings.

(2) Directions under this rule may include any direction:

(a) as to the time for service of experts’ reports

(b) that expert evidence may not be adduced on a specified issue

(c) that expert evidence may not be adduced on a specified issue except by leave of the court

(d) that expert evidence may be adduced on specified issues only

(e) limiting the number of expert witnesses who may be called to give evidence on a specified issue

(f) providing for the engagement and instruction of a parties’ single expert in relation to a specified issue

(g) providing for the appointment and instruction of a court-appointed expert in relation to a specified issue

(h) requiring experts in relation to the same issue to confer, either before or after preparing experts’ reports in relation to a specified issue

(i) that may assist experts in the exercise of their functions

(j) that experts who have prepared more than one expert report in relation to any proceedings are to prepare a single report that reflects their evidence in chief.

93.4 A broad and express discretion to direct expert witnesses to confer, to endeavour to reach agreement on any matters in issue, to prepare a joint report specifying matters agreed and matters not agreed and reasons for any disagreement. A draft provision is as follows:

(1) The court may direct expert witnesses:

(a) to confer, either generally or in relation to specified matters

(b) to endeavour to reach agreement on any matters in issue

(c) to prepare a joint report, specifying matters agreed and matters not agreed and reasons for any disagreement

(d) to base any joint report on specified facts or assumptions of fact, and may do so at any time, whether before or after the expert witnesses have furnished their experts’ reports.

(2) The court may direct that a conference be held:

(a) with or without the attendance of the parties affected or their legal representatives

or

(b) with or without the attendance of the parties affected or their legal representatives, at the option of the parties
or

(c) with or without the attendance of a facilitator (that is, a person who is independent of the parties and who may or may not be an expert in relation to the matters in issue).

(3) An expert witness so directed may apply to the court for further directions to assist in the performance of such expert functions.

(4) Any such application must be made in writing to the court, specifying the matter on which directions are sought.

(5) An expert witness who makes such an application must send a copy of the request to the other expert witnesses and to the parties affected.

(6) Unless the parties affected agree, the content of the conference between the expert witnesses must not be referred to at any hearing.

(7) If a direction to confer is given under rule (1)(a) before the expert witnesses have furnished their reports, the court may give directions as to:

(a) the issues to be dealt with in a joint report by the expert witnesses

(b) the facts, and assumptions of fact, on which the report is to be based, including a direction that the parties affected must endeavour to agree on the instructions to be provided to the expert witnesses.

(8) This rule applies if expert witnesses prepare a joint report as referred to in rule (1)(c).

(9) The joint report must specify matters agreed and matters not agreed and the reasons for any disagreement.

(10) The joint report may be tendered at the trial as evidence of any matters agreed.

(11) In relation to any matters not agreed, the joint report may be used or tendered at the trial only in accordance with the rules of evidence and the practices of the court.

(12) Except by leave of the court, a party affected may not adduce evidence from any other expert witness on the issues dealt with in the joint report.

93.5 A broad and express discretion to make directions for the manner in which expert evidence is to be given, including to facilitate concurrent expert evidence (hot-tubbing). A draft provision is as follows:

In any proceedings in which two or more parties call expert witnesses to give opinion evidence about the same issue or similar issues, or indicate to the court an intention to call expert witnesses for that purpose, the court may give any one or more of the following directions:

(a) a direction that, at trial:

(i) the expert witnesses give evidence after all factual evidence relevant to the issue or issues concerned, or such evidence as may be specified by the court, has been adduced

or

(ii) the expert witnesses give evidence at any stage of the trial, whether before or after the plaintiff’s case has closed

or

(iii) each party intending to call one or more expert witnesses close that party’s case in relation to the issue or issues concerned, subject only to adducing evidence of the expert witnesses later in the trial

(b) a direction that after all factual evidence relevant to the issue, or such evidence as may be specified by the court, has been adduced, each expert witness file an affidavit or statement indicating:

(i) whether the expert witness adheres to any opinion earlier given

or

(ii) whether, in the light of any such evidence, the expert witness wishes to modify any opinion earlier given

(c) a direction that the expert witnesses:

(i) be sworn one immediately after another (so as to be capable of making statements, and being examined and cross-examined, in accordance with paragraphs (d), (e), (f), (g) and (h))

(ii) when giving evidence, occupy a position in the courtroom (not necessarily the witness box) that is appropriate to the giving of evidence

(d) a direction that expert witnesses give an oral exposition of their opinion, or opinions, on the issue or issues concerned

(e) a direction that expert witnesses give their opinion about the opinion or opinions given by other expert witnesses

(f) a direction that expert witnesses be cross-examined in a particular manner or sequence

(g) a direction that cross-examination or re-examination of the expert witnesses giving evidence in the circumstances referred to in paragraph (c) be conducted:

(i) by completing the cross-examination or re-examination of one expert witness before starting the cross examination or re-examination of another

or

(ii) by putting to each expert witness, in turn, each issue relevant to one matter or issue at a time, until the cross examination or re-examination of all of the expert witnesses is complete

(h) a direction that any expert witness giving evidence in the circumstances referred to in paragraph (c) be permitted to ask questions of any other expert witnesses who are concurrently giving evidence

(i) such other directions as to the giving of evidence in the circumstances referred to in paragraph (c) as the court thinks fit.

93.6 A discretion to direct the parties to engage a single joint expert, and to make directions for the preparation of the expert’s report and the cross-examination of the expert. A draft provision is as follows:

(1) Selection and engagement

(a) If an issue for an expert arises in any proceedings, the court may, at any stage of the proceedings, order that an expert be engaged jointly by the parties affected.

(b) A parties’ single expert is to be selected by agreement between the parties affected or, failing agreement, by direction of the court.

(c) A person may not be engaged as a parties’ single expert unless he or she consents to the engagement.

(d) Any party affected who knows that a person is under consideration for engagement as a parties’ single expert:

(i) must not, prior to the engagement, communicate with the person to obtain an opinion as to the issue or issues concerned, and

(ii) must notify the other parties affected of the substance of any previous communications for that purpose.

(2) Instructions to parties’ single expert

(a) The parties affected must endeavour to agree on written instructions to be provided to the parties’ single expert concerning the issues arising for the expert’s opinion and the facts, and assumptions of fact, on which the report is to be based.

(b) If the parties affected cannot so agree, they must seek directions from the court.

(3) Parties’ single expert may apply to court for directions

(a) The parties’ single expert may apply to the court for directions to assist in the performance of the expert’s functions in any respect.

(b) Any such application must be made in writing to the court, specifying the matter on which directions are sought.

(c) A parties’ single expert who makes such an application must send a copy of the request to the parties affected.

(4) Parties’ single expert’s report to be sent to parties

(a) The parties’ single expert must send a signed copy of his or her report to each of the parties affected.

(b) Each copy must be sent on the same day and must be endorsed with the date on which it is sent.

(5) Parties may seek clarification of report

(a) Within 14 days after the parties’ single expert’s report is sent to the parties affected, and before the report is tendered in evidence, a party affected may, by notice in writing sent to the expert, seek clarification of any aspect of the report.

(b) Unless the court orders otherwise, a party affected may send no more than one such notice.

(c) Unless the court orders otherwise, the notice must be in the form of questions, no more than ten in number.

(d) The party sending the notice must, on the same day as it is sent to the parties’ single expert, send a copy of it to each of the other parties affected.

(e) Each notice sent under this rule must be endorsed with the date on which it is sent.

(f) Within 28 days after the notice is sent, the parties’ single expert must send a signed copy of his or her response to the notice to each of the parties affected.

(6) Tendering of reports and answers to questions

(a) Unless the court orders otherwise, the parties’ single expert’s report may be tendered in evidence by any of the parties affected.

(b) Unless the court orders otherwise, any or all of the parties’ single expert’s answers in response to a request for clarification may be tendered in evidence by any of the parties affected.

(7) Cross-examination of parties’ single expert

Any party affected may cross-examine a parties’ single expert, and the expert must attend court for examination or cross-examination if so requested on reasonable notice by a party affected.

(8) Prohibition of other expert evidence

Except by leave of the court, a party to proceedings may not adduce evidence of any other expert on any issue arising in proceedings if a parties’ single expert has been engaged under this Division in relation to that issue.

(9) Remuneration of parties’ single expert

(a) The remuneration of a parties’ single expert is to be fixed by agreement between the parties affected and the expert or, failing agreement, by direction of the court.

(b) Subject to sub-rule (c), the parties affected are jointly and severally liable for the remuneration of a parties’ single expert.

(c) The court may direct when and by whom a parties’ single expert is to be paid.

(d) Sub-rules (b) and (c) do not affect the powers of the court as to costs.

93.7 The court should have a broad and express discretion to appoint experts. A draft provision is as follows:

(1) Selection and appointment

(a) If an issue for an expert arises in any proceedings the court may, at any stage of the proceedings:

(i) appoint an expert to inquire into and report on the issue

(ii) authorise the expert to inquire into and report on any facts relevant to the inquiry

(iii) direct the expert to make a further or supplemental report or inquiry and report

(iv) give such instructions (including instructions concerning any examination, inspection, experiment or test) as the court thinks fit relating to any inquiry or report of the expert or give directions on the giving of such instructions.

(b) The court may appoint as a court-appointed expert a person selected by the parties affected, a person selected by the court or a person selected in a manner directed by the court.

(c) A person must not be appointed as a court-appointed expert unless he or she consents to the appointment.

(d) Any party affected who knows that a person is under consideration for appointment as a court-appointed expert:

(i) must not, prior to the appointment, communicate with the person to obtain an opinion as to the issue or issues concerned

(ii) must notify the court as to the substance of any previous communications for that purpose.

(2) Instructions to court-appointed expert

The court may give directions as to:

(a) the issues to be dealt with in a report by a court-appointed expert

(b) the facts, and assumptions of fact, on which the report is to be based, including a direction that the parties affected must endeavour to agree on the instructions to be provided to the expert.

(3) Court-appointed expert may apply to court for directions

(a) A court-appointed expert may apply to the court for directions to assist in the performance of the expert’s functions in any respect.

(b) Any such application must be made in writing to the court, specifying the matter on which directions are sought.

(c) A court-appointed expert who makes such an application must send a copy of the request to the parties affected.

(4) Court-appointed expert’s report to be sent to registrar

(a) The court-appointed expert must send his or her report to the registrar, and a copy of the report to each party affected.

(b) Subject to the expert having complied with the code of conduct and unless the court orders otherwise, a report that has been received by the registrar is taken to be in evidence in any hearing concerning a matter to which it relates.

(c) A court-appointed expert who, after sending a report to the registrar, changes his or her opinion on a material matter must immediately provide the registrar with a supplementary report to that effect.

(5) Parties may seek clarification of court-appointed expert’s report

Any party affected may apply to the court for leave to seek clarification of any aspect of the court-appointed expert’s report.

(6) Cross-examination of court-appointed expert

Any party affected may cross-examine a court-appointed expert, and the expert must attend court for examination or cross-examination if so requested on reasonable notice by a party affected.

(7) Prohibition of other expert evidence

Except by leave of the court, a party to proceedings may not adduce evidence of any expert on any issue arising in proceedings if a court-appointed expert has been appointed under this Division in relation to that issue.

(8) Remuneration of court-appointed expert

(a) The remuneration of a court-appointed expert is to be fixed by agreement between the parties affected and the expert or, failing agreement, by direction of the court.

(b) Subject to sub-rule (c), the parties affected are jointly and severally liable for the remuneration of a court-appointed witness.

(c) The court may direct when and by whom a court-appointed expert is to be paid.

(d) Sub-rules (b) and (c) do not affect the powers of the court as to costs.

94. There should be a more extensive code of conduct for expert witnesses, including a duty to:

(1) comply with the applicable overriding obligations

(2) comply with a direction of the court

(3) work cooperatively with other expert witnesses.

95. Expert witnesses should not be immune from sanctions applicable to other participants in the civil justice system, including costs orders in appropriate cases. However, there should not be specific sanctions directed solely at expert witnesses.

96. Expert witnesses shall, at the time of service of their reports or at any other time ordered by the court, disclose: (a) the basis on which they are being remunerated for services as an expert witness, including whether any payment is contingent on the outcome of the proceedings; (b) the details of any hourly, daily or other rate; and (c) the total amount of fees incurred to date.

97. It should be made clear that privilege in respect of any communication with an expert or any document arising in connection with the engagement of the expert (including drafts of reports, letters of instruction etc) is waived as soon as it is confirmed that the expert will be called to give evidence in court. Privilege in respect of communications with experts retained but not proposed to be called to give evidence would not be affected.

98. The requirement that the defendant serve on the plaintiff any medical report prepared as a result of an examination of the plaintiff, regardless of whether the defendant intends to use it in court, should be retained.

Chapter 8: Improving Remedies in Class Actions

99. There should be no legal ‘requirement’ that all class members have legal claims against all defendants in class action proceedings, but all class members must have a legal claim against at least one defendant.

100. There should be no legal impediment to a class action proceeding being brought on behalf of a smaller group of individuals or entities than the total number of persons who may have the same, similar or related claims, even if the class comprises only those who have consented to the conduct of proceedings on their behalf.

101. The Supreme Court should have discretion to order cy-pres type remedies where (a) there has been a proven contravention of the law, (b) a financial or other pecuniary advantage has accrued to the person contravening the law as a result of such contravention, (c) the loss suffered by others, or the pecuniary gain obtained by the person contravening the law, is capable of reasonably accurate assessment and (d) it is not possible, reasonably practicable or cost effective to identify some or all of those who have suffered a loss.

102. The power to order cy-près type remedies should include a power to order payment of some or all of the amount available for cy-près distribution into the Justice Fund.

103. The court’s power to order cy-près type remedies should not be limited to distribution of money only for the benefit of persons who are class members or who fall within the general characteristics of class members.

104. The court’s general discretion as to how any cy-près relief should be implemented should not be limited to any proposal or agreement of the parties to the class action proceeding.

105. Unless the court orders otherwise, the parties should be required to give court-approved notice to the public that the power to order cy-près type remedies may be exercised. Where appropriate, this should include notice to particular entities that the court or the parties consider may be appropriate recipients of funds available for cy-près distribution.

106. Subject to leave of the court, persons other than the parties to the class action proceeding may be permitted to appear and make submissions in connection with any hearing at which cy-près orders are to be considered by the court.

107. There should be no general right of appeal against the exercise of the court’s discretion as to the nature of the cy-près relief ordered but there should be a limited right of appeal, based on House v The King type principles.

Chapter 9: Helping Litigants with Problems and Hindering Problem Litigants

108. The Self-represented Litigants Co-ordinator program in the Supreme Court of Victoria should be resourced and funded on an ongoing basis and the scope of the existing program should be extended. For instance, additional positions should be resourced and funded in the County Court and the Magistrates’ Court (initially in the Melbourne registries, with a view to extending services to suburban and regional registries).

109. The proposed Civil Justice Council, in conjunction with the courts and VCAT, should investigate the possibility of implementation of a court-based pro bono referral scheme (along the lines of the Order 80 scheme in the Federal Court) in each of those courts.

110. In appropriate cases, the Supreme and County Courts should have the option of appointing a special master in matters where one or more of the parties are self-represented. A special master should be a judicial officer of a lower tier than a judge, or a senior legal practitioner, who will case manage proceedings in proactive manner in order to facilitate the appropriate disposition of the proceeding. The costs of any externally appointed special master should be at the discretion of the court and, on an interim basis, may be ordered to be costs in the cause.

111. Courts at all levels should be properly resourced to develop information and material for self-represented litigants and to enhance the delivery of resources of this kind, where possible, through technological solutions. Such resources should be considered an integral part of the services provided to court users.

In particular, an audio-visual aid should be produced (possibly by or with the assistance of the Victoria Law Foundation) to explain in broad terms the processes of civil litigation. This resource could be made available on the courts’ websites, as well as in court registries.

112. Existing training programs for judicial officers addressing the needs of, and the challenges posed, by self-represented litigants should be resourced to allow for the extension and further development of such programs to a greater number of judicial officers in Victoria each year. Where it is not already the case, programs should be extended to masters and court registrars. Such programs should be considered an integral part of ongoing training and education for judicial officers.

113. To the extent that it is not already the case, courts of all levels should provide training for all court staff who come into contact with members of the public, including registry staff and judges’ associates, about the needs of and challenges posed by self-represented litigants. In particular, training is required for court staff to develop strategies to help them:

• work with self-represented litigants

• avert and manage difficult situations

• provide accurate information about services and resources and, in particular, to distinguish between information and advice.

114. The Law Institute and the Victorian Bar should develop professional guidelines to assist solicitors and barristers in dealing with self-represented litigants to whom they are opposed. Guidelines could address issues such as protocols for communication, record keeping, conduct during negotiations and personal security issues.

115. Programs should be put in place in all courts and properly resourced to provide:

• reliable data about the numbers of self-represented litigants and their levels of participation in the court system

• analysis of data to assess the impact of self-represented litigants on the court system

• qualitative research to assess the effectiveness of measures adopted to assist self-represented litigants and manage matters in the court system where at least one party is unrepresented.

116. Where appropriate, data collection should be a by-product of the Integrated Courts Management System or other existing systems. Analysis of the data and qualitative research should be undertaken or commissioned by the proposed Civil Justice Council.

117. Courts at all levels should develop self-represented litigant management plans. Such plans should be considered an integral part of overall planning by the courts so that measures put in place to meet the challenges of self-represented litigants are well targeted and outcomes can be measured against identified aims and objectives.

Interpreting fund

118. A fund should be established (‘the interpreting fund’) which may be drawn on to fund interpreters in civil proceedings in Victorian courts in appropriate cases (as provided for below).

Payment from the interpreting fund

119. Victorian courts should be given the discretion to recommend that it is in the interests of justice for payment to be made from the interpreting fund for interpreting services in civil proceedings for litigants who require it. In exercising the discretion the court should be able to take into account:

(a) the means of the litigant

(b) any other matter that the court considers appropriate.

Costs of interpreter

120. Insofar as the existing rules do not so provide, there should be, subject to judicial discretion in relation to costs, provision for an order that such services should be the subject of a party–party costs order and any funds recovered should be reimbursed to the interpreting fund.

Definition of interpreter

121. The legislation should provide a definition of interpreter along the following lines: ‘interpreter’ means an interpreter accredited with the National Accreditation Authority for Translators and Interpreters Limited.

Telephone interpreting service

122. The Department of Justice should provide funding for the provision of telephone interpreting services for legal practitioners acting on a pro bono basis through a Victorian pro bono referral scheme.

Development of policies

123. All Victorian courts should develop detailed policies about the provision of interpreters and such policies should be made publicly available.

Research

124. Empirical research should be undertaken to ascertain the ambit of the problem of ‘vexatious’ litigants, not limited to those who may be subject to an order under existing provisions. Research identifying the impact of vexatious litigants on the courts would be useful, as well as research considering the impact or effectiveness of the making of orders declaring a person to be vexatious.

Standing

125. The categories of persons who should have standing to bring an application should be broadened:

125.1 The Victorian Government Solicitor should be included, in addition to the Attorney-General, as a public officer with standing to bring an application.

125.2 The commission is not of the view that it is necessary or desirable to provide that the court of its own initiative may bring an application (as provided in the Queensland Act). Rather the court should be empowered to refer a matter to the prothonotary or registrar for action.

125.3 The categories of parties who have standing to make an application should be widened to include not only the Attorney-General and the Victorian Government Solicitor but also:

• the Prothonotary of the Supreme Court or the Principal Registrar of the County Court; or,

with the leave of the court,

• a person against whom another person has instituted or conducted vexatious proceedings, or

• a person who has a sufficient interest in the matter.

Adoption of legislative reforms in other states

126. The following reforms (which are largely in place in the Queensland Act and the WA Act) should be introduced:

126.1 The requisite test should be liberalised to reflect the test contained in the Queensland Act, namely, where a person has ‘frequently’ instituted or conducted vexatious proceedings in Australia the court may make orders prohibiting or limiting the right of a person to take or continue legal action.

126.2 The court should be empowered to make an order prohibiting and limiting the right of a person acting in concert with a vexatious litigant to take or continue a legal action. Legislation should also prevent a vexatious litigant from acting in concert with, or directing, another person to bring legal proceedings that are the subject of the order against the vexatious litigant. Such provisions appear in the Queensland Act.

126.3 A statutory definition of ‘vexatious proceedings’ should be introduced along the lines of the definition in the Queensland Act and the WA Act.

126.4 The court should be empowered to have regard to ‘proceedings’ broadly defined, including interlocutory and appellate proceedings (as in the definition in the Queensland Act and the WA Act) as well as proceedings in any Australian court or tribunal (as in the Queensland Act).

126.5 A provision should be introduced that sets out the types of orders that the court may make, including orders staying existing proceedings and prohibiting the institution of proceedings and ‘any other order the court considers appropriate’ (as in the Queensland Act). The last of these options envisages orders restraining certain conduct or orders awarding costs.

126.6 A provision should be introduced that specifically allows the court to extend its orders to corporate entities or incorporated associations affiliated with the litigant the subject of the order.

126.7 In addition to the gazetting of any order, a provision should be introduced that requires the Prothonotary of the Supreme Court to enter any order in a register at the court. This register should be able to be searched through the Supreme Court’s website so as to determine if a particular party is a vexatious litigant. Unlike under the Queensland Act, it is not proposed that the prothonotary have broad discretion to publish the details of any order. Rather it is proposed that the legislation require the prothonotary to notify the heads of all jurisdictions in Victoria and the principal registrars in all jurisdictions in Victoria of any order made.

Vexatious proceedings in other courts and tribunals

127. Each of the courts and tribunals in Victoria (other than the Supreme Court) should have express power to make a vexatious proceedings order limited to proceedings within the jurisdiction of that court or tribunal. The Supreme Court should retain the power to make orders in respect of any court or tribunal in Victoria.

Automatic stay

128. Once an application for a vexatious proceedings order is made, there should be an automatic stay in relation to pending proceedings and a prohibition on the commencement of further proceedings pending the hearing unless the court orders otherwise.

Evidence

129. Evidence in support of the application should be on affidavit and may be provided on the basis of ‘information and belief’. Cross-examination on affidavit evidence should only be allowed with leave of the court.

Declaring proceedings a nullity

130. If, despite the making of a vexatious proceedings order, proceedings are commenced by the person the subject of the order, such proceedings should be a nullity.

Determination on the papers

131. To circumvent the problem of vexatious litigants absorbing court time by making repeated applications for leave to commence proceedings, legislation should provide that, unless the court otherwise orders, such applications should be determined on the papers without the need for a formal oral hearing.

Discretion to waive court fees

132. The prothonotary or registrar should have the discretion to waive court fees and photocopying and other charges otherwise payable by the applicant in proceedings for orders in relation to a vexatious litigant.

Chapter 10: A New Funding Mechanism
 

133. A new funding body (the ‘Justice Fund’) should be established to (a) provide financial assistance to parties with meritorious civil claims, (b) provide indemnity for any adverse costs order or order for security for costs made against the party assisted by the fund.

134. For administrative convenience, and to minimise establishment costs, the fund should be established, at least initially, as an adjunct to an existing organisation. One possible body is Victoria Legal Aid.

135. The fund should be structured to minimise potential liability for income tax or capital gains tax on any amount received by the fund.

136. The fund should seek to become self funding through (a) entering into funding agreements with assisted parties whereby the fund would be entitled to a share of the amount recovered by the successful assisted party; (b) having statutory authority in class action proceedings under Part 4A of the Supreme Court Act 1986 (Vic) to either (i) enter into agreement with an assisted representative party whereby the fund would be entitled to a share of the total amount recovered by the class under any settlement or judgment, subject to approval of the court, or (ii) to make application to the court for approval to receive a share of the total amount recovered by the class under any settlement or judgment; (c) recovering, from other parties to the proceedings, costs incurred in providing assistance to the assisted party where the assisted party is successful and obtains an order for costs; (d) receiving funds by order of the Court in cases where cy–près type remedies are available and (e) entering into joint venture litigation funding arrangements with commercial litigation funding bodies.

137. Where the fund provides assistance the lawyers acting for the assisted party should normally be required to conduct the proceedings without remuneration or reimbursement of expenses until the conclusion of the proceedings. Where the proceedings are successful they should normally be remunerated by costs recovered from  the unsuccessful party and/or out of any monies recovered in the proceedings, without the fund having to pay the costs incurred in the proceedings. Where the assisted party is unsuccessful the fund should meet the costs of the funded party as set out in the funding agreement or varied thereafter by agreement between the fund and the law firm conducting the case of the assisted party.

138. During its first five years of operation (or such lesser period as the trustees of the fund may determine in light of the financial position of the fund), the liability of the fund for any order for costs or security for costs made against the funded party should be limited, by statute, to the value of the costs incurred by the assisted party which the fund is required to pay to the lawyers acting for the assisted party under to the funding agreement. During such period the fund would have a discretion to pay some or all of the shortfall between the amount ordered by way of adverse costs or security for costs against the assisted party and the amount of such costs for which the fund is liable.

139. At any stage of the proceedings the fund or the assisted party could apply to the court for an order limiting the amount of costs that the assisted party may be ordered to pay to any other party if the funded party is unsuccessful in the proceedings.

140. The operation of the fund should be subject to audit and monitored by the Civil Justice Council.

Chapter 11: Reducing The Cost of Litigation

Ongoing costs review and reform

141. A specialist Costs Council should be established, as a division of the Civil Justice Council. The Costs Council, in consultation with stakeholder groups, would: (a) review the impact of the commission’s implemented recommendations about costs; (b) investigate the additional matters in relation to costs referred to in the commission’s report, including those matters raised in submissions; (c) carry out or commission further research in relation to costs; and (d) consider such other reforms in relation to costs as the council considers appropriate.

Costs disclosure

142. The court should have an express power to require parties to disclose to each other and the court estimates of costs and actual costs incurred.

143. In exercising the proposed power to order disclosure of costs incurred and estimates of costs likely to be incurred, there should be limits on the type of information required to be disclosed to protect information that may have confidential strategic or forensic significance or which might otherwise be privileged (other than information concerning the quantum, break up or method of calculation of legal fees and expenses).

Fixed or capped costs

144. Although fixed or capped costs are a good idea in principle, there are practical problems in their implementation. These should be developed for particular areas of litigation after consultation and with the agreement of stakeholders (under the auspices of the Costs Council/Civil Justice Council).

Taxation of costs

145. The present multiple bases for taxation of costs should be simplified.

146. There should be a presumptive rule that interlocutory costs orders should not be taxed prior to the final determination of the case unless the court orders otherwise.

Solicitor–client costs and party–party costs

147. The present gap between party–party and solicitor–client costs is unreasonable in a number of cases. The recoverable costs on a party–party basis should usually be ‘all costs reasonably incurred and of a reasonable amount’, unless the court, in the exercise of its discretion, makes an order on some other basis.

148. Other methods for ordering recovery of legal costs of a successful party should be utilised (more often), including ordering costs as a specified percentage of the actual (reasonable) solicitor–client costs, with a view to avoiding the costs and delays associated with the present process of taxation of costs.

Scales of costs

149. The court scales of costs need to be revised and/or updated.

150. There should be a common scale of costs across courts. The question of whether there should be proportionate differentials, between courts, in terms of recoverable party–party costs should be considered by the Costs Council.

151. In the event that there is a common scale for recoverable party–party costs applicable across the three courts, in addition to considering whether there should be ‘standard’ percentage reductions in the amount of costs recoverable depending on which court the proceeding is in, the Costs Council should consider whether the principle that the recoverable costs should be ‘reasonable’ is sufficiently flexible to accommodate variations between courts (in the event that such variations are considered desirable) without the need for prescribed variations.

Cost of disbursements

152. There should be a prohibition on law firms profiting from disbursements, including photocopying, except in the case of clients of reasonably substantial means who agree to pay for disbursements which include an element of profit. When a client recovers costs, only the reasonable actual costs of the disbursements (excluding any profit element) should be recoverable from the losing party.

A draft provision is as follows:

(1) Unless the client or another person providing indemnity or financial support for the client is (a) of reasonably substantial means and (b) agrees to pay in excess of the prescribed rate for disbursements, a law practice shall not charge a client any amount for disbursements in excess of the prescribed rate.

(2) In making any order for costs against a party or other person who is not a party the court shall not allow recovery of any amount for disbursements in excess of the prescribed rate.

(3) Law practice includes any related person or entity, including a service company.

(4) Prescribed rate means the approximate actual cost of the disbursement without any allowance for mark-up by the law practice or profit by the law practice. The actual cost may include a reasonable allowance for law practice office overheads. (For example: the ‘actual cost’ of internal photocopying would include (i) the cost of the paper, (ii) charges payable to an unrelated lessor or owner of any photocopying equipment used in making the copies and (iii) other costs associated with the purchase, lease or use of photocopying equipment in the possession of the law practice. The cost of the labour involved in the copying and collating would be included as part of the allowance for law practice office overheads. The ‘actual cost’ of copying done externally would be the charges made by an unrelated commercial photocopying company plus a reasonable allowance for law practice office overheads, including the labour involved in collating, despatching and collecting the documents.)

(5) To avoid complicated computations, the law practice may make a reasonable estimate of the approximate actual cost of the disbursement or charge at a rate approximate to the rate charged by unrelated commercial suppliers of services (eg, photocopying).

(6) The prescribed rate for disbursements may be set by the Costs Council.

Public interest litigation costs

153. There should be express provision for courts to make orders protecting public interest litigants from adverse costs in appropriate cases, including orders made at the outset of the litigation. The fact that a litigant may have a pecuniary or other personal interest in the outcome of the proceeding should not preclude the court from determining that the proceedings are in the public interest.

Percentage fees

154. The current absolute legislative prohibition of percentage contingent fees should be reconsidered, provided that any proposed (regulated) percentage fee arrangements are subject to adequate safeguards to protect consumers and to prevent abuse.

155. The determination of whether regulated percentage fees should be introduced, with appropriate safeguards, should be made by the Costs Council after consultation with the Legal Services Commissioner, the Law Institute of Victoria and the Victorian Bar Council. The Costs Council could also consider whether there are particular types of legal work where percentage fees should not be permitted.

156. The Costs Council should also reconsider whether percentage fees could be introduced by way of a ‘scale of costs’ within the meaning of the Legal Profession Act 2004.

157. The Cost Council should consider what safeguards and protections, if any, would be appropriate in the event that proportionate fees were to be permitted.

Proportionate and other fees in class action proceedings

158. The Costs Council, after consultation with the Legal Services Commissioner, the Law Institute of Victoria and the Victorian Bar should also consider whether proportionate and other types of fees, including fees based on the work actually done with a multiplier (similar to the ‘lodestar’ method applied by Canadian and US courts) should be recoverable in class action proceedings. However, fees in class action proceedings should be subject to court approval where they will ultimately be paid or reimbursed by class members who have not individually consented to the fee arrangements.

Court fees

159. Court fees should be reviewed by the Costs Council. There is a need for greater standardisation and simplification of court fees. There are strong arguments in favour of higher ‘user pays’ fees for commercial litigants and easier and simpler methods for reducing or waiving fees for those who cannot afford them.

Offers of compromise and costs

160. The rules relating to offers of compromise and costs consequences should be reviewed by the Costs Council.

Justice Fund

161. The (proposed) Justice Fund should provide assistance, including indemnity in respect of adverse costs, in cases other than class actions, after it has become self-funding.

162. In cases where funding is provided by the Justice Fund during its first five years of operation the liability of the fund in respect of adverse costs should be limited to an amount equivalent to the amount of funding provided to the assisted party. The assisted party would remain personally liable to meet any shortfall between the amount of an adverse costs order and the maximum liability of the fund. However, during this period the fund should have a discretion to pay any shortfall if it is in a financial position to do so. Also, the fund should have standing to apply to the court for an order limiting the potential liability of the funded party for adverse costs.

Research on costs

163. There is a need for more data and research on costs. One means by which this might be achieved is by empowering the court to require parties to disclose costs data at the conclusion of the matter or at any other stage of the proceeding.

Chapter 12: Facilitating Ongoing Civil Justice Review and Reform

Rule-making process and powers

164. The courts’ governing legislation should make provision for the constitution and operation of each court’s rules committee. The chair of each rules committee (or the chair’s nominee) could be made an ex-officio member of each other committee entitled to attend the other committees’ meetings. This would provide for increased communication between the three jurisdictions.

165. The rules committees should meet jointly when considering rules and procedures which apply in more than one jurisdiction. This may involve a joint meeting of two or three rules committees.

166. The power to make rules should be broadened and exercised so as to further the courts’ overriding purpose. A draft amendment to section 25 of the Supreme Court Act 1986 is as follows:

(1) The Judges of the Court […] may make Rules of Court for or with respect to the following:

(f) Any matter relating to—

(i) the practice and procedure of the Court; or

(ii) the powers, authorities, duties and functions of the officers of the Court;

(iii) the powers, authorities, duties and functions of the Court in imposing limits, restrictions or conditions on any party in respect of any aspect of the conduct of proceedings; or

(iv) the management of cases; or

(v) the referral (with or without the consent of the parties) to any form of alternative dispute resolution; or

(vi) the means by which the Overriding Purpose may be furthered.

Equivalent amendments to the County Court Act and the Magistrates’ Court Act would also be required.

Court rules

167. The legislation and rules of civil procedure in all three courts should be reviewed to:

• achieve greater harmonisation between courts, including standardisation of the terminology used to describe procedural steps, and standardisation of court forms. In particular there should be one form for commencing proceedings and one for making interlocutory applications

• simplify the structure and ordering of the rules

• make greater use of plain English.

168. Each court should clarify the circumstances in which practice notes and directions are made, and consolidate and organise the content and publication of existing practice notes and directions.

Ongoing reform

169. A new body, called the Civil Justice Council, with ongoing statutory responsibility for review and reform of the civil justice system, should be established. Its purpose would be to investigate ways to make the civil justice system more just, efficient, and cost effective.

170. The Civil Justice Council would have the following functions:

• to monitor the operation of the civil justice system generally

• to identify areas in need of reform

• to conduct or commission research

• to bring together various stakeholder groups with a view to reaching agreement on reform proposals, including through the use of mediation and other methods

• to recommend reforms, including amendments to statutory provisions and rules governing the civil justice system

• to facilitate education programs about developments in the civil justice system.

171. The Civil Justice Council should also assist in the implementation of the reforms proposed by the Victorian Law Reform Commission and monitor the impact of such reforms, which may include:

• developing specific pre-action protocols for each relevant area (for example, commercial disputes, building disputes, medical negligence, general personal injury, etc)

• monitoring the operation of the protocols and general standard of pre-action conduct so that any modifications considered necessary in the light of practical experience can be implemented

• overseeing and developing further the operation of pre-trial examinations, including:

– developing a general code of conduct in respect of examination conduct

– developing codes of practice to govern the use of pre-trial examinations in particular litigation contexts

– overseeing the establishment of education and training programs to assist practitioners and other interested parties to develop good examination practices

– reviewing the provisions relating to pre-trial examinations with a view to assessing their effectiveness and costs consequences, and considering possible changes to the existing scheme. The Council should also consider and make recommendation on the question of whether pre-trial examinations should be permissible in matters within the jurisdiction of the Magistrates’ Court, and if so, whether any modifications to the general scheme are required in relation to such matters;

– constituting a specialist Costs Council to oversee and monitor issues to do with legal costs

• reviewing ADR processes in all three courts

• scrutinising the operation of the Justice Fund

• assisting in a review of the rules of civil procedure.

172. The Civil Justice Council should comprise members from a broad range of participants in the civil justice system and stakeholder groups, including:

• members of the judiciary

• members of the legal profession

• public servants concerned with the administration of the courts

• persons with experience in and knowledge of consumer affairs

• persons with experience and expertise relevant to particular types of litigation (for example representatives from the business community, insurance industry, consumer organisations, and the community legal sector).

173. The chair and members of the Civil Justice Council should be appointed by the Attorney-General after calling for nominations from the courts and relevant stakeholder groups.

174. Members of the Civil Justice Council would be appointed for their expertise and experience, and not necessarily as representatives of the entities or organisations for which they work.

175. Members of the Civil Justice Council would serve in an honorary capacity but would be reimbursed for expenses etc. There would be a secretariat comprising a chief executive officer and support staff.

176. The Civil Justice Council should be able to co-opt people to form committees to focus on specific areas under review.

177. The Civil Justice Council should be entitled to an allocation of funds from the Justice Fund to assist it to carry out its functions.

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