DR 13 Department of Immigration and Citizenship

DIAC Submission on ALRC Consultation Paper – Discovery in Federal Courts

We thank you for the opportunity to comment on the ALRC Consultation Paper on Discovery in Federal Courts. The Department of Immigration and Citizenship (DIAC) supports in principle the ongoing development of the discovery process in litigation before Federal Courts.

1.	General comments

High Court

	The need for discovery in DIAC-related matters rarely arises in the High Court. In our experience, if proceedings were commenced in the original jurisdiction of the High Court, it is likely the matter would be remitted to another court. As a result, DIAC does not have substantial experience with discovery in proceedings before the High Court, and we have therefore not provided responses to any of the questions or proposals in the Consultation Paper relating to proceedings before the High Court. 

Federal Magistrates Court

	While DIAC frequently conducts administrative law matters before the Federal Magistrates Court, discovery orders are rarely made in those proceedings. Therefore, we have not provided responses to any of the questions or proposals in the Consultation Paper relating to the Federal Magistrates Court. 

Family Court of Australia

	Apart from compliance with subpoenas, DIAC has very little experience or role in relation to proceedings before the Family Court. We have therefore not provided responses to any of the questions or proposals in the Consultation Paper relating to the Family Court.

Model litigant obligation

	As a Commonwealth agency DIAC is required to comply with the ‘model litigant’ obligation, set out in Appendix B of the Attorney General’s Legal Services Directions (2005). The relevance of the model litigant obligation to the conduct of the discovery process is addressed in more detail in our response to Part 4 of the Consultation Paper.

Information stored electronically

	DIAC notes that the advance of computer technologies has resulted not only in more information being stored, but also in the duplication of much stored information. While there are some advantages in searching through information that is stored electronically, compared to information stored in hard copy, DIAC supports the view that the ongoing development of computer technologies presents challenges in the discovery process.

There are a number of references to the electronic storage and provision of information in the Consultation Paper. However, it is often unclear whether these references are to the discovery of information that is stored electronically, or the provision of information in electronic form. This makes it difficult to provide helpful responses to some of the questions in the Consultation Paper. However, DIAC has a number of general concerns in relation to the impact of electronic systems on the discovery process.

In relation to discovery obligations, DIAC does not see any benefit in constructing a distinction between documents that are stored electronically, and documents that are stored in hard copy. For example, Proposal 3-4 contemplates more substantial judicial intervention in the discovery process where documents that are stored electronically are concerned. In situations where discovery is conducted by consent, as is often the case for DIAC-related matters, there does not appear to be any need to demand additional judicial involvement.

More generally, Proposal 3-4 sets out a number of procedural steps that could be required in proceedings in which the Federal Court has directed that discovery be given of documents that are in an electronic format. It is unclear, however, why such steps would be required only in the case of documents that are in electronic format. That is, DIAC considers that such steps would be of equal utility, or otherwise, in any proceeding where discovery has been ordered, regardless of the format of the documents concerned. 

	Given the ambiguity surrounding the description of electronic documents in the Consultation Paper, and having regard to the comments presented above, DIAC does not wish to otherwise comment on questions in the Consultation Paper that relate to information that is stored electronically at this stage.

Interdepartmental discovery

	DIAC notes that a particularly challenging aspect of discovery is in cases where a number of Commonwealth agencies are involved in the defence of a particular matter. In such cases, there are often differences between the Commonwealth agencies in areas such as attitude towards discovery, methods of conducting discovery, and ability and/or willingness to allocate resources to the discovery process.

	In cases where DIAC has been the lead agency in such matters, our experience is that the coordination of the discovery process is a significant challenge, in light of the differences mentioned above. In our view, the provision of education and training to Commonwealth agencies in relation to the importance of discovery, and the obligations it entails, would be of substantial benefit. Further, information sharing arrangements between Commonwealth agencies in relation to discovery procedures would also assist lead agencies to better meet their discovery obligations.

2.	Legal framework for discovery in Federal Courts

2-2:	Does the requirement for leave of the court effectively regulate the use of discovery in civil proceedings in the Federal Court?

No. DIAC’s limited experience is that obtaining the leave of the court to file and serve a notice for discovery, pursuant to O 15 r 1 of the Federal Court Rules (‘the FCR’), is usually a mere formality. The rule does not operate as a substantive limitation on a party’s ability to obtain discovery. In DIAC-related matters, we consider that it would be unusual for a Federal Court Justice to refuse an application for leave to file and serve a notice for discovery.

2-3:	Is the law sufficiently clear on when the Federal Court should grant leave for discovery of documents in civil proceedings?

The considerations relevant to the decision of a Federal Court Justice on whether to grant leave for discovery are set out clearly in Practice Note CM 5: Discovery of the Federal Court of Australia. However, DIAC’s experience is that the Federal Court generally grants leave to file and serve a notice for discovery of documents, notwithstanding the requirements set out in the relevant practice note.

2-4:	Should the Federal Court of Australia Act 1976 (‘the FCA Act’) be amended to adopt the provisions of s 45 of the Federal Magistrates Act 1999 (‘the FM Act’) in relation to discovery, so that discovery would not be allowed in the Federal Court unless the Court made a declaration that it is appropriate, in the interests of the administration of justice, to allow the discovery? If not, should another threshold test be adopted? What should that threshold test be?

	As noted in our general comments, DIAC generally attempts to conduct discovery by consent. In such situations, it is difficult to imagine why it would be necessary to disallow discovery in the absence of a declaration, after the associated consideration, by the court. Where the parties have agreed on the scope and method of discovery, DIAC does not see any benefit in having that agreement examined by the court, except perhaps where one of the parties is not represented.

	DIAC considers that an analysis of the effect of s 45 of the FM Act on proceedings before that court would be beneficial to any consideration as to whether similar provisions should be adopted for the Federal Court. 

	In general, DIAC supports in principle measures to narrow the scope of discovery applications in Federal Court proceedings. However, DIAC also notes the issues such measures might raise with regard to individuals’ access to justice. Therefore, any ‘threshold test’ introduced for discovery applications should ensure that individuals, and/or disadvantaged litigants, are not prevented from accessing the courts.

	For example, DIAC considers that there is merit in a threshold test that is based on a ‘cost-benefit analysis’. However, consideration must be given as to the precise nature of such an analysis, and to who conducts that analysis. The analysis could be conducted by the party giving discovery, the party seeking discovery, or the court. While the party giving discovery might be best placed to provide an analysis of cost, it is possible that the parties’ analysis of the benefit of discovery would differ. In cases where there is a dispute about the cost-benefit analysis, or where a litigant is not represented, it may be more appropriate for the court to conduct that analysis.

	DIAC is aware of the concern that a threshold test may give rise to additional ‘satellite litigation’ in relation to disputes about whether that test has been met. However, DIAC does not have experience of satellite litigation in relation to discovery in matters before the Federal Court. DIAC is aware that there may be other Government agencies where this is a more significant issue.

2-5:	Are the categories of documents required to be disclosed under the FCR too broad? If so, where should the parameters be set?

DIAC considers that the broad nature of the categories provided for under the FCR allows discovery orders, by consent or otherwise, sufficient scope to provide for the discovery of relevant documents.

DIAC considers that the relevance of documents to a matter can only be decided on a case by case basis. The current FCR allow for a court, or the parties to a matter, to specify a narrow range of documents within a broad set of categories. DIAC does not consider that there would be any benefit in narrowing the scope of those categories in a uniform manner for all cases, and all areas of litigation, as the categories of relevant documents will vary from case to case.

2-6:	Should O 15 r 2 of the FCR be amended to adopt the categories of documents discoverable in Fast Track proceedings, so that discovery in the Federal Court is limited to the following documents of which the party giving discovery is aware at the time orders for discovery are made or discovers after a good faith proportionate search:
	(a)	documents on which the party intends to rely; and 
(b) documents that have significant probative value adverse to a party’s case?

For the reasons outlined in our response to question 2-5, DIAC supports the view of the ALRC that reforms to limit the categories of documents discoverable in proceedings before the Federal Court are not necessary. DIAC supports the view that while cultural change is required for the effective reform of discovery in the Federal Court, changes to discovery practice and procedure represent a more effective approach to achieving such cultural change.

3.	Discovery practice and procedure in Federal Courts

3-2:	In general, does the amount of money spent on the discovery process in proceedings before the Federal Court generate:

	(a)	too much information;
	(b) too little information; or
	(c) about the right amount of information

	to facilitate the just and efficient disposal of the litigation?

Where possible, please provide examples or illustrations of the costs of discovery relative to the information needs of the case.

DIAC’s experience of the discovery process is largely limited to our civil damages caseload. Very few damages proceedings that are initiated against DIAC proceed through to judgment; most are resolved prior to trial. Therefore, it is difficult for DIAC to assess whether the money spent by DIAC on the discovery process generates too much, or too little, information. Moreover, DIAC is not able to comment on any aspects of the costs of the discovery process, other than the costs involved in retrieving documents and information. Other costs associated with the discovery process are managed by Comcover under DIAC’s insurance arrangements. DIAC also notes that it is difficult to answer this question in a general sense, as the situation varies dramatically from case to case.

DIAC agrees that the value of discovery is not limited to obtaining documents to tender at trial. DIAC considers that the exchange of documents and information during the discovery process can have a substantial effect not merely on clarifying the issues in dispute, but also on resolving matters completely prior to trial. DIAC considers that these peripheral benefits of the discovery process should be taken into account in any consideration of the value of the discovery process in proceedings before the Federal Court. 

3-4:	Has discovery by categories of documents, or particular issues in dispute, reduced the burden of discovery in proceedings before the Federal Court? If not, what has prevented the parties, their lawyers and the court from cost-effectively limiting the scope of discovery?

Yes. In DIAC’s limited experience, narrowing the scope of documents to particular issues in dispute has reduced the burden of discovery in proceedings before the Federal Court.

DIAC also considers, however, that the scope of discovery could be further limited if litigants, and legal practitioners, were more willing to engage with their respective opposing parties. DIAC considers that more and better communication between opposing parties, with regard to the costs and potential benefits associated with particular categories of documents, is the most effective way of narrowing the scope of discovery, and thereby reducing the burden of discovery in Federal Court proceedings.

DIAC notes the concern mentioned in the Consultation Paper that the fact that 70 % of discovery orders are made by consent of the parties confirms that the court is not making serious attempts to limit the ambit of discovery to specific issues in dispute, by order under O 15 r 3 of the FCR. However, DIAC does not share this concern. DIAC considers that where the parties are able to determine the scope and procedure of discovery by agreement, there is little benefit in the additional intervention of the court in the process.

3-5:	Has the creation of discovery plans and use of pre-discovery conferences helped to ensure proportionality in the discovery of electronically-stored information in Federal Court proceedings? If not, what has prevented the court, the parties and their lawyers from establishing practical and cost-effective discovery plans in advance of the search for electronic documents?

	DIAC has had limited exposure to discovery and pre-discovery conferences in Federal Court proceedings. However, DIAC is often forced to confront a perception that Commonwealth litigants enjoy unlimited resources in relation to discovery procedures. We consider this perception to be a substantial barrier to establishing practical and cost-effective discovery plans, as some parties and their lawyers, and indeed some members of the Judiciary, may not accept that the scarcity of Commonwealth resources should be a factor in determining the proportionality of information searches. We note, however, that this perception is probably less prevalent in Federal Court proceedings than in proceedings before State courts.

Proposals 3-1 – 3-3

	DIAC considers that these proposals represent unnecessary additional requirements, and costs, in situations where discovery is made by consent. Where the parties are in agreement as to the scope and procedure of discovery, there does not appear to be any need to impose additional mandatory steps to regulate the conduct of the discovery process.

	However, DIAC considers that these proposals would be reasonable and sensible in situations where there are disputes surrounding discovery, or where one party is not represented. 

3-6:	Should parties be required to produce to each other and the court key documents early in proceedings before the Federal Court? If so, how could such a procedural requirement effectively be imposed?

	It is unclear precisely what is meant by the term ‘key documents’. If such a procedural requirement were to extend to documents that are not generally subject to discovery, then DIAC would have substantial concerns about requiring their production.

	If the term relates, however, to the ‘most significant’ documents of the cohort of documents that are subject to discovery, then DIAC would support measures to encourage the provision of such documents as early in a particular proceeding as is practically possible. 

In DIAC’s experience, the provision of key documents can be a substantial factor in the resolution of a matter. It follows that there is considerable merit in ensuring that key documents are provided as early as possible in proceedings, to enable proceedings that can be resolved prior to judgment to be resolved as quickly as possible. DIAC would therefore support any procedural requirement that requires key documents to be provided as early as possible, subject to reasonable allowances for processing, retrieval etc. 

3-8:	Should special masters be introduced to manage the discovery process in proceedings before the Federal Court? If so, what model should be adopted?

	In DIAC’s experience, the need for a special master has not arisen in proceedings before the Federal Court. However, DIAC is aware that such provision may be of assistance in litigation conducted by other agencies.

Proposal 3-5 
	
	Part VB of the Federal Court of Australia Act 1976 (Cth) should be amended to provide the court with broad and express discretion to exercise case management powers and impose sanctions in relation to the discovery of documents, in line with ss 55 and 56 of the Civil Procedure Act 2010 (Vic).

	DIAC considers the measures outlined in Proposal 3-5 to be both reasonable and sensible. DIAC is of the view that in cases where it is not possible to conduct discovery by consent, or where one party to the litigation is unrepresented, the court is the appropriate authority to intervene to ensure that the discovery process is conducted in a fair and efficient manner. The relevant provisions in the Civil Procedure Act 2010 (Vic) appear to give effect to this purpose.

3-9:	Should there be a presumption that a party requesting discovery of documents in proceedings before the Federal Court will pay the estimated cost in advance, unless the court orders otherwise?

	DIAC considers that such a presumption would dramatically narrow the scope of discovery in Federal Court proceedings. However, based on our experience we think the court would be likely to order against such a presumption in most cases where discovery is sought from DIAC. 

Further, we note that the litigant opposed to DIAC is generally an individual, and a presumption of the kind mentioned above would involve substantial issues in relation to individuals’ access to justice. DIAC notes, therefore, that while this proposal may have merit where litigation is conducted between a Government agency and a legal person, or between two legal persons, it would not be suitable where individuals are concerned. 

3-10:	Should the Federal Court have explicit statutory powers to make orders limiting the costs able to be charged by a law practice to a client for discovery, to the actual costs to the law practice of carrying out such work (with a reasonable allowance for overheads, but excluding a mark up or profit component)?
	
	DIAC does not have sufficient knowledge of the charging practices of law firms in relation to compensation litigation, as these matters and their billing are managed by Comcover. 

Proposal 3-6

The Federal Court should develop and maintain a continuing judicial education and training program specifically dealing with judicial management of the discovery process in Federal Court proceedings, including the technologies used in the discovery of electronically-stored information.
	
DIAC considers that this proposal has substantial merit. While we do not consider judicial management of the discovery process to be necessarily deficient, that management could only be improved by continuing judicial education and training, especially in the area of new technology. 

4.	Ensuring Professional Integrity: Ethical Obligations and Discovery

	DIAC notes that the questions and proposals in Part 4 of the Consultation Paper relate almost exclusively to the ethical obligations of lawyers in relation to the discovery process in litigation proceedings. DIAC considers that its response to these questions and proposals can be more effectively addressed with general comments, rather than specific responses. As previously noted, the model litigant obligations in the Legal Services Directions, to which DIAC must adhere, govern the entire litigation process and it is arguably not necessary for a differentiation to be made for discovery processes. 

Misuse of discovery process

We note that DIAC is not aware of widespread misuse of the discovery process by legal practitioners. While there may be some instances where the conduct of the discovery process by lawyers could be characterised as an abuse of process, in our experience such instances are rare. Disproportionate discovery requests, onerous discovery orders, and inefficiencies in the discovery process, are usually the result of inadequate pleadings, rather than misuse of the process itself. Frequently, conducting discovery by consent means that the communication and engagement of the parties allows such issues to be resolved through the narrowing of pleadings and the admission of some facts. As such, we consider that the most important area in which lawyers’ behaviour could be improved is in their engagement with opposing litigants; while it may be possible to characterise this as an ethical issue, we do not consider it to be relevant in terms of an abuse of the discovery process.

Model litigant obligations

	DIAC, as a Commonwealth agency, is required to behave as a model litigant in the conduct of litigation, and thus to meet the obligation set out in Appendix B of the Legal Services Directions (2005). That obligation includes, for example, dealing with claims promptly and not causing unnecessary delay in the handling of claims and litigation (Item 2(a) refers); and, not taking advantage of a claimant who lacks the resources to litigate a legitimate claim (Item 2(f) refers).

	DIAC lawyers undertake extensive training to ensure that they are fully aware of the model litigant obligation, and strive to meet that obligation in all aspects of litigation. The panel firms engaged by DIAC to conduct litigation are also well informed of the model litigant obligation owed by DIAC, and of the importance of meeting that obligation.

	The fact that DIAC and its panel firms possess a competent understanding of the Commonwealth’s model litigant obligation, and place considerable import on meeting that obligation, means that DIAC lawyers and, in our experience, panel firms representing DIAC, do not engage in the types of unethical behaviour covered in Section 4 of the Consultation Paper. Further, as noted above, DIAC’s exposure to unethical conduct by opposing litigants and lawyers has been limited.

Information and education

As a result, DIAC is not aware of a need to amend professional conduct rules, for example, to address discovery specifically. However, DIAC does not oppose increased information and education in relation to the ethical conduct of lawyers generally. DIAC considers that ensuring that lawyers are aware of how and where to report allegations of lawyer misconduct, and the circumstances in which such reporting is mandatory, would be the most effective method of improving lawyers’ ethical conduct generally, including in relation to the discovery process. 

5.	Alternatives to discovery

As is the case for Part 4 of the Consultation Paper, DIAC considers that its response to the questions and proposals under Part 5 of the Consultation Paper can be more effectively addressed with general comments, rather than specific responses. 

Pre-action protocols

	As noted in the Consultation Paper, the imposition of pre-action protocols generally results in the front-loading of costs in proceedings. Because the party opposing DIAC in litigation is generally an individual, the front-loading of costs necessarily entails significant issues with regard to individuals’ access to justice. This is the case notwithstanding the fact that pre-action protocols may lead to the earlier resolution of matters.

	DIAC notes also that pre-action protocols will be of more utility in some areas of litigation than in others. We therefore stress, as noted in the Consultation Paper, that if pre-action protocols are introduced, then the front-loading of costs must be kept to a level that does not make it prohibitively expensive for individuals to bring actions against Government agencies.

Order 80 - Court-appointed lawyer	

	In relation to measures ensuring that individuals have appropriate access to justice, notwithstanding the introduction of pre-action protocols, DIAC refers to Order 80 of the FCR, which provide for the appointment of pro bono legal assistance by the Court. 

Communication and Engagement

	DIAC considers an increase in communication between opposing parties to litigation, and an increase in the willingness of legal practitioners to engage opposing parties, to be the most effective measure to resolve many of the issues surrounding the discovery process. However, DIAC considers that this increased communication and engagement is most likely to be effected by cultural change within the legal profession, rather than the imposition of requirements or obligations, or the amendment of professional conduct rules. Ideally, such cultural change would come from within the legal profession, such as through relevant professional bodies. 

Proposal 5-1

	The Australian Government and the Federal Court, in consultation with relevant stakeholders, should work to develop specific pre-action protocols for particular types of civil dispute with a view to incorporating them in Practice Directions of the Court.

	In relation to the development of pre-action protocols for civil disputes, DIAC emphasises that such protocols must be specific to particular types of litigation. For example, there is a range of pre-action protocols that may be of value in tax litigation proceedings, but that would serve no useful purpose in compensation proceedings to which DIAC is a party. The costs of imposing generic pre-action protocols across all forms of litigation, especially in terms of individuals’ access to justice, would, in our view, far outweigh any benefit that may be derived from such protocols in specific cases.

Pre-trial oral examination

	DIAC does not, in principle, oppose the introduction of pre-trial oral examinations in proceedings before the Federal Court. We emphasise, however, that such measures should be implemented on a discretionary basis, and certainly not prescribed as mandatory procedures.

	DIAC notes, however, that it is not entirely clear what could be gained from pre-trial examination procedures that is not already possible through interrogatories and the submission of affidavits, at least in the context of litigation to which DIAC is a party.