Referees

8.33 Most Australian Courts have the power to refer certain matters to referees. The following section considers whether the Federal Court might use such referees to perform some of the discovery work described above.

Federal Court referees

8.34 The Court has a relatively new legislative power, introduced in 2009,^[49] to refer proceedings and questions to referees. Under s 54A of the Federal Court of Australia Act, the Federal Court may refer ‘a proceeding … or one or more questions arising in a proceeding … to a referee for inquiry and report’.^[50] Order 72A of the Federal Court Rules provides that the Court may refer ‘a proceeding in the Court’ or ‘1 or more questions or issues arising in a proceeding, whether of fact or law or both, and whether raised by pleadings, agreement of parties or otherwise’.^[51]

8.35 The Court may make directions with respect to the conduct of an inquiry by a referee, but subject to those directions, the referee:

(a) may conduct the inquiry in any way the referee thinks fit; and

(b) is not bound in the inquiry by the rules of evidence but may inform himself or herself in any way the referee thinks fit.^[52]

8.36 Evidence before a referee in an inquiry:

(a) may be given orally or in writing; and

(b) must, if the Court requires, be given:

(i) on oath or by affirmation; or

(ii) by affidavit.^[53]

8.37 Unless otherwise ordered by the Court, the referee must give his or her opinion in a report.^[54] The Court may then choose to adopt the report in whole or in part, or vary or reject it.^[55] Referees do not make decisions that are automatically binding on the parties. They are not delegated judicial power. The Court may also make ‘such orders as the Court thinks fit in respect of any proceeding or question referred to the referee’.^[56] The Court may make directions about the remuneration of a referee, including a direction that a party give security for the remuneration.^[57]

8.38 In the Second Reading Speech for the relevant Bill introducing s 54A, the Australian Government Attorney-General said that the reform would ‘enable the court to more effectively and efficiently manage large litigation’:

It will be particularly useful in many cases, such as those involving complex technical issues or where detailed examination of financial records is necessary to assess damages. It will also be of assistance in native title matters where a judge could be assisted by an inquiry into a particular aspect of the claim.

The procedural flexibility with which a referee can deal with a question—along with their technical expertise—will allow a referee to more quickly get to the core of technical issues and reduce the cost and length of trials for litigants.^[58]

Is discovery a question or issue arising in a proceeding?

8.39 As noted above, under O 72A of the Federal Court Rules the Court may refer ‘a proceeding’ or ‘1 or more questions or issues arising in a proceeding’.^[59] Is a discovery matter ‘a proceeding’ or a question or issue arising in a proceeding, under this Rule?^[60] The ALRC is not aware of any judicial consideration of this precise question, but the meaning of ‘proceeding’ has been considered in other contexts. Proceeding is defined in s 4 of the Federal Court of Australia Act to mean:

a proceeding in a court, whether between parties or not, and includes an incidental proceeding in the course of, or in connexion with, a proceeding, and also includes an appeal.^[61]

8.40 In Carnegie Corporation Ltd v Pursuit Dynamics Plc,^[62]French J referred to authority for the definition of proceeding being ‘very wide’ and encompassing a motion for security of costs and the issue of summons for examination. French J then concluded:

In my opinion and consistently with the authorities in this Court an application for preliminary discovery is an application in a ‘proceeding’ within the meaning of that word in the Federal Court Act and therefore within the meaning of O 8. An application for preliminary discovery is therefore ‘an application commencing a proceeding’ and is within the new definition of ‘originating process’ in O 8, r 1.^[63]

8.41 The question whether an application under O 15A r 3 was a proceeding was answered differently in Telstra Corporation Ltd v Minister for Communications, Information Technology and the Arts.^[64] In that case, an application by a prospective applicant for an order for discovery to assist the applicant to decide whether to commence a proceeding was found not to be a ‘proceeding’.

8.42 After considering Telstra, Carnegie and other authorities, Barker J in Re McJannett concluded that:

the point to be drawn from this selective analysis of authority is that not every step or action in a court will necessarily be considered a ‘proceeding’.^[65]

8.43 Even if a discovery application is not a proceeding, a question or questions arising on a discovery application may fall within the description of ‘1 or more questions or issues arising in a proceeding’.

8.44 It may also be noted that the Federal Court Rules add to the words in the Act the following words in italics: ‘questions or issues arising in a proceeding, whether of fact or law or both, and whether raised by pleadings, agreement of parties or otherwise’.^[66] The words ‘whether raised by pleadings, agreement of parties or otherwise’ may indicate a question in the substantive proceeding rather than in an interlocutory step. Furthermore, it may be that the use of referees elsewhere in place and time may be conducive to this restrictive definition. Accordingly, not only is there a difference of judicial views about the application of the definition of ‘proceeding’, but the scope of the second limb of the rule (starting ‘1 or more questions’) is also open to strong differences of opinion.

State and territory court referees

8.45 State and territory courts can refer proceedings to referees for a report.^[67] In Queensland, for example, the court ‘may in a proceeding, except a trial by jury, refer a question of fact to a special referee—(a) to decide the question; or (b) to give a written opinion on the question to the court’.^[68] The court may direct the special referee to make a report in writing to the court.^[69]

8.46 In New South Wales, in Park Rail Developments Pty Ltd v RJ Pearce Associates Pty Ltd, Smart J stated that the matters that will generally require consideration when deciding whether to refer a question to a referee are:

(a) the suitability of the issues for determination by a referee and the availability of a suitable referee;

(b) the delay before the court can hear and determine the matter and how quickly a suitable referee can do so …;

(c) the prejudice the parties will suffer by any delay;

(d) whether the reference will occasion additional costs of significance or is likely to save costs;

(e) the terms of any reference including the issues and whether they should be referred for determination or inquiry or report.^[70]

8.47 Although the NSW Supreme Court ‘has power to appoint a referee against the wishes of both parties’, Smart J said, ‘it is understandably cautious in doing so’.^[71]