Bjelivuk v Gemstone Exploration Pty Ltd [2001] QLRT 78

LAND AND RESOURCES TRIBUNAL QUEENSLAND CITATION: Re Milos Bjelivuk, Sedina Bjelivuk and Ivan Uzarevic and Gemstone Exploration Pty Ltd [2001] QLRT 78 PARTIES: Milos Bjelivuk, Sedina Bjelivuk and Ivan Uzarevic Applicants - and - Gemstone Exploration Pty Ltd Respondent FILE NO: OTX70001/2001 PROCEEDING: Interlocutory Issue – Practice and Procedure DELIVERED ON: 7 November 2001 DELIVERED AT: Brisbane HEARING DATE: 26 October 2001 PRESIDING MEMBER: Smith DP ORDERS: 1. I order that the inappropriate material contained within Land and Resources Tribunal File No OTX70001/2001 be removed from the filed copy of the amended Application to Start Proceedings of 5 July 2001 and placed in a separately sealed envelope and held in the safe custody of the Registrar with an extract of this Order appearing on the front of the said envelope. (at [29]) 2. I order that the inappropriate material contained within copy material held in my Chambers relating to Land and Resources Tribunal File No OTX70001/2001 be removed from the copy of the amended Application to Start Proceedings of 5 July 2001 and placed in a separately sealed envelope and held in the safe custody of the Registrar with an extract of this Order appearing on the front of the said envelope. (at [29]) -- 1 of 18 -- 3. I disqualify myself from the further consideration of this proceeding. (at [29]) 4. I order that the Land and Resources Tribunal File No OTX70001/2001 and relevant material held in my Chambers, together with a copy of my decision in this matter, be referred to the President of the Land and Resources Tribunal for his further action. (at [29]) CATCHWORDS: OFFER TO SETTLE – WITHOUT PREJUDICE OFFER – MEDIATION – INAPPROPRIATE MATERIAL – DISCRETION TO CONTINUE HEARING – OBJECTION – MATTERS UNCONSCIOUSLY ENTERING THE JUDICIAL MIND – PERCEPTION OF JUSTICE – DISQUALIFICATION – COSTS – CREDIT OF WITNESSES Appeal Costs Fund Act 1973 s. 22(1)(c) Queensland Coal P/L & Anor v Shaw & Anor [2001] QCA 463, referred to Williams v Volta [1982] VR 739, applied Harvey and Ors v Harvey [1965] QWN 41, applied State Rail Authority of New South Wales v Earthline Constructions Pty Ltd [1999] 160 ALR 588 at 617, referred to SOLICITORS: Ian Dempster of Skewes & Dempster, Solicitors for the Applicants AGENT: Mr Reid for the Respondent Overview [1] SMITH DP: The judicial role is sometimes not an easy one. Nor, I should add, is it meant to be. This judgment certainly falls within the category of “not an easy one”. No doubt, some observers would disagree, for in this matter there were easy choices that I could have made. That I have chosen not to take the easy way out is I believe supported by the authorities. Certainly, when there is -- 2 of 18 -- an “easy” legal solution, that should be taken note of. However, an “easy” legal solution must never be confused with a decision of convenience. As each judicial officer accepts appointment, we do so with a vow to uphold the law. As the Court of Appeal so aptly put it only recently when dealing with an issue of statutory interpretation: “While it is true that courts are now more reluctant to infer the invalidity of acts done contrary to a statutory requirement than they formerly were, the determination of the court is one of proper interpretation, not of convenience.”1 [2] Accordingly, I have chosen not to turn a blind eye in circumstances when I could easily have done so, and no-one, except me, would have ever known. I have chosen not to make a decision in exercising my discretion, which would have been easy to do, and proceed to final judgment in this matter, for at its core such a decision would have been based on issues of convenience, not only to one of the parties, but also to the Tribunal, in overlooking a mistake made in the Tribunal Registry. [3] In the event, for the reasons that follow, I find myself compromised to the extent that I believe that it would be improper for me to continue in this matter. I know that this decision will cause great inconvenience to Milos Bjelivuk, Sedina Bjelivuk and Ivan Uzarevic (hereinafter referred to as the Applicants) through absolutely no fault of their own. No doubt, even though it supports me taking such action, Gemstone Exploration Pty Ltd (hereinafter referred to as the Respondent) will also be inconvenienced by not having this action quickly resolved, as it was so close to being. I expect that this decision will also cause embarrassment to the Tribunal. That is unavoidable and regrettable, but not a ground which can properly sway my discretion in any way. Hopefully, this decision will ensure that detailed procedures are put in place so that, as much as is humanly possible, such a mistake is never again made. Background [4] By an Application to Start Proceedings filed in the Tribunal on 3 May 2001 the Applicants sought the following orders against the Respondent: 1 Queensland Coal P/L & Anor v Shaw & Anor [2001] QCA 463 at paragraph 15. -- 3 of 18 -- “The Applicants claim: (a) a declaration that they are entitled, in law and in equity to exercise all of the rights and enjoy all of the benefits conferred upon them by the instruments set out hereunder to the exclusion of the respondents, namely: (i) mining lease number ML7271, Mining District of Winton in the name of Ivan Uzarevic; (ii) mining lease number ML95104 in the Mining District of Winton in the name of Ivan Uzarevic; (iii) mining lease number ML95198 in the Mining District of Winton in the name of Ivan Uzarevic; (iv) mining lease application number MLA95269, Mining District of Winton in the name of Milos Bjelivuk and Sedina Bjelivuk; (v) application for exploration permit EPM11392 in the name of Milos Bjelivuk. (vi) Application for exploration permit EPM11542 in the name of Milos Bjelivuk. (“the tenements”) (b) a permanent injunction restraining the respondents from entering upon the tenements or carrying out thereon any mining or mining related activity without the prior written consent of the respondents and each of them; (c) An order that caveat bearing dealing number 995586 registered over mining leases ML7271, ML9514, ML95198 and ML95269 be removed. (d) an account of profits in respect of any opal taken by the respondents from the tenements or any of them since 23 April 2001; (e) damages in such sum as to this tribunal may seem appropriate; (f) such further or other order as to this tribunal may seem appropriate.” [5] Importantly, on 21 June 2001 I ordered amendment to the Application to Start Proceedings. An amended application was subsequently filed in the Tribunal on 5 July 2001. [6] The hearing of this matter has occupied significant time and resources of the Tribunal as well as the parties. On 7 September 2001, having received the final submissions, I reserved judgment. [7] During the course of preparation of my final judgment in this matter I have unfortunately read a document which should not have been in the material before me. The circumstances as to how I received this material is best set out in the transcript of 26 October 2001 when I brought this matter back on before the parties in light of the material improperly before me. The relevant transcript is in the following terms: “D PRESIDENT SMITH: ……..The judgment in this matter was to be handed down next week. I have completely formulated my reasons and my decision, and it was a matter of actually cross-checking to ensure that the amended application was in terms as I remembered it from the hearing, and that was simply removal, as I understood it, of the damages aspect from the application that I even turned to that document -- 4 of 18 -- having not had to trouble myself with it during the course of the hearing in the way the matters progressed. It was at that time then that I noticed the size of the document and turned, as one can tend to do, to the back of it to see why it was so thick, and I saw Annexure B, which I read. I then turned back a couple of pages. The area marked, “Offer to settle” doesn’t stand out; it’s not in bold, it’s not highlighted, it doesn’t appear as a title. And as, I suppose, legal training tends to, we just simply read paragraphs and I quickly skimmed through the paragraphs and got to about 4 or 5 in a quick skim before I went back up and read the heading, having become very concerned by then as to what the material was and how it could possibly be an attachment to the application to start proceedings. So if I’d have started at the front page and worked my way through and read the words, “Applicant’s Offer to Settle”, then I could have stopped at that point and we wouldn’t have a difficulty. My trouble is that offers to settle are matters which should not be brought to the attention of a Presiding Member, either by inadvertence or by a deliberate act, and once they do come to the Member’s attention it creates certain difficulties for the Member, who has to then exercise a discretion as to whether or not that member can go on to give final Judgment in the matter or whether the file has to be passed to somebody else to complete.2” [8] After making the disclosure to the parties the following response was made: “MR DEMPSTER: Essentially, in summary, Deputy President, it would be our urging that you simply proceed to make a decision. Respectfully, we consider that whatever you may have read would not reasonably have compromised your capacity to reach a decision on all of the evidence and it would be in the interests of justice that you do so.”3 [9] For reasons that I trust will become obvious, I then felt it necessary to make a further disclosure to the parties. My making of such further disclosure was not of itself without difficulties. A judicial officer does not in normal circumstances inform the parties of what terms a judgment may take prior to delivery. However, in order for the parties to properly consider their position in light of the material improperly before me I was left in no position other than to make the additional disclosure. I should add that it making the additional disclosure I have done so on the basis that the improper material referred to which has so troubled me in this instance shall form no part of the record in this judgment and that another Presiding Member of this Tribunal will not have access to it. [10] The further disclosure that I made and the parties response is as follows: 2 Transcript 26 October 2001 page 4 line 30 to page 5 line 4. 3 Transcript 26 October 2001 page 6 line 39 to line 50. -- 5 of 18 -- “D PRESIDENT SMITH: ……………..Would your position be altered, in any way, if it transpired that a decision in this matter was in very proximate terms to the offer to settle? Mr Dempster? MR DEMPSTER: I might have to reflect on that for a short while. D PRESIDENT SMITH: Mr Reid? MR REID: I feel sure Deputy President that the directors of Gemstone wouldn’t accept that. D PRESIDENT SMITH: Would not accept that? MR REID: Not – not on those terms.”4 [11] What the transcript does not reveal is the lengthy break which occurred after I asked my question and before Mr Dempster’s response. It was immediately clear to me that Mr Dempster was troubled by the position enunciated in my further disclosure. That is also exhibited by Mr Dempster’s response. Neither does the transcript show the forcefulness with which Mr Reid made his response that the Respondent would not accept the position as I had outlined it. Findings on the circumstances of improper material being placed in Chambers [12] Immediately I became aware of the improper material on the morning of 24 October 2001 I took certain action which I recorded in my judicial notebook. It is appropriate that that note form part of this judgment. It is in the following terms: “Bjelivuk & Ors v Gemstone Exploration Pty. Ltd. In Chambers Ex Mero Motu 24.10.01 As part of my deliberations for the judgment in this matter, earlier today I was reviewing the pleadings and, in particular, the Amended Application to Start Proceedings dated 5 July 2001. I noted that my copy of the Amended Application to Start Proceedings contained an attachment marked “Annexure “B””. I read that attachment. I then turned back a couple of pages and skim read further material attached to the Amended Application to Start Proceedings. I became increasingly concerned regarding the contents of what I was reading and then carefully read again the page I was reading (the sixth page of the Amended Application to Start Proceedings) and only then did I read the title to that page (which is not in bold) which states “The Applicants offer to settle these proceedings on the following terms:” I immediately contacted my case officer and asked her to bring up to my Chambers the original Amended Application to Start Proceedings. This she did. The original contained 9 pages identical to the copy I hold in Chambers. In light of the contents of pages 6-9 of the Amended Application to Start Proceedings I require the parties to appear before me at a mention of this matter at 9.30am Queensland time 26.10.01 Parties outside Brisbane may appear by telephone. 4 Transcript 26 October 2001 page 6 line 52 to page 7 line 9. -- 6 of 18 -- I direct that a typed copy of these chamber notes be made and provided to the parties. Sgd Paul Smith Paul A. Smith Deputy President Land and Resources Tribunal 24.10.01” [13] Ian Dempster, the solicitor for the Applicants, swore an affidavit on 26.10.01. The affidavit is relevantly in the following terms: “2. On the 5th day of July, 2001, I caused to be filed in this Tribunal an amended Form 2 Application to start proceedings. 3. Now produced and shown to me and marked with the letter “IGD1” is a true and correct copy of the said Application. 4. There were no annexures to the said Application at the time of filing. 5. On the 24th October, 2001, I received from this Tribunal a copy of the Chamber Note of Deputy President Smith bearing same date. 6. On the same date, I received a further facsimile transmission from the Tribunal enclosing copies of the offer of settlement and “Annexure B” referred to in said Chamber Note. 7. I say that the documents referred to in the above paragraph were prepared by Mr Michael Jarrett of Counsel on the 10th July, 2001 following the adjournment of the trial on that date. A copy was provided by Michael Jarrett to Mr Peter Keenan, Solicitor for the Respondent, on the same date and before the commencement of mediation later that day. 8. At the foot of Annexure B, there is reference to a date “10.07.01”. 9. I recall that during the mediation, a copy of these documents were provided to the mediator. 10. At no stage was either document filed in the Tribunal by myself or any other person to my knowledge. 11. The only means by which said documents could have been placed on the Tribunal’s file is either if the Solicitors for the Respondent inadvertently tendered these documents into evidence or if the mediators inadvertently included these documents into the Tribunal’s files.”5 [14] The evidence of Mr Dempster has not been challenged by the Respondent. I accept his evidence. I have not called for any evidence under oath from any staff of the Tribunal. However, in accepting Mr Dempster’s uncontested evidence it appears relatively clear what has occurred. At some stage during the handling of the Tribunal file during a mediation process conducted pursuant to an Order of mine, the Offer to Settle and Annexure have become mixed up with and subsequently attached to the amended Application to Start Proceedings on the Tribunal file. When my material has been updated by my case officer for the purposes of my hearing the matter subsequently, the amended Application to 5 Affidavit Ian Gilbert Dempster sworn and filed 26 October 2001 paragraphs 2 to 11. -- 7 of 18 -- Start Proceedings with its improper attachments, has been simply copied and included with my material. [15] I accordingly find that neither the Applicants nor the Respondent are responsible for the improper material appearing before me in Chambers. It is a circumstance completely out of their control which has arisen as a result of Registry action. Whilst it is on its face a simple mistake, for the reasons that follow it is clearly the case that such simple errors can have a profound impact on the hearing of a matter. Submissions of the parties [16] Following the mention of this matter on 26 October 2001 written submissions were received from the parties. In the circumstances, I consider it appropriate to include in full what each party has to say in this matter. -- 8 of 18 -- -- 9 of 18 -- -- 10 of 18 -- -- 11 of 18 -- -- 12 of 18 -- -- 13 of 18 -- [17] One element of the Applicants’ submission is curious. Whilst it is clearly true that on my first disclosure the Respondent had no objection to my continuing in the matter, it’s position dramatically shifted following my second disclosure. The Respondent’s submissions are completely consistent with those changed circumstances. The authorities [18] It is apparent from the Applicants’ submissions that they do not consider the document improperly before me to be an Offer to Settle pursuant to part 5 of the Uniform Civil Procedure Rules. However, for the reasons that follow, that makes little difference. [19] As McInerney J. observed in Williams v Volta “The process of ‘payment in’ is, in my judgment, analogous to the process of a ‘without prejudice’ offer of settlement: see per Gavan Duffy, J. in Cole v Austin Distributors Ltd., [1953] VLR 155, at p. 159 and RSC O22, r6, and its corresponding provision in the County Court Rules obviously enshrine the same policy.” 6 [20] McInerney J. continued: “In my view it is undesirable in the extreme that the fact of payment in and the date of payment in should be disclosed to the Judge before he determines the question of interest. The policy of the Supreme Court Rules, at all events since 1938, has been to prohibit the disclosure to the trial Judge of the fact or date or amount of payment in. The policy behind that provision has been obviously that the trial Judges’ determination on the question of liability – and I believe also on the question of interest – should not be embarrassed or affected by knowledge of the fact or date or amount of the payment in. In my view the same policy is evident in the provisions of the County Court Rules, O 19, r6.” 7 At the very least the Offer to Settle and Annexure is a privileged document passing between the parties. It would also appear to be subject matter of the confidential mediation. The observations of McInerney J. are therefore appropriate to this case. Indeed, it has not been argued by either of the parties that I was entitled to see either the Offer to Settle or the Annexure. 6 [1982] VR 739 at 754 7 [1982] VR 739 at 754. -- 14 of 18 -- [21] There is Queensland authority also on point. In Harvey and Ors v Harvey8 Campbell J. had this to say: “The present O.XXVI was inserted in the Rules of the Supreme Court in 1958, and is based on O.XXII of the English Rules which resurrected in 1933 the Practice before the Civil Procedure Act 1833 (3 & 4 Will. IV, c. 42) of not putting payments into Court on the record by way of plea. It appears that the practice of actually pleading a payment in came about to save expense: Tattersall v. Parkinson (1847) 16 M. & W. 752, at p. 759: 153 E.R., at p. 1393. However, there is a different purpose behind the change back to the old practice: the purpose is to ensure that the fact of a payment in does not consciously or unconsciously enter into the assessment of damages. Disclosure of a payment in would certainly justify a Judge in refusing to hear a case. But the rule is directory and not compulsory, and a Judge has a discretion to allow a case to proceed where the rule is by inadvertence or otherwise broken: Williams v Grose (1897) 1 Q.B. 471; Millensted v. Grosvenor House (Park Lane) Limited (1937) 1 K.B. 717. In the present case no objection is taken by the parties to me hearing the action, and the case does not appear to be one which I should refuse to hear in the interests of the administration of justice.”9 [22] In my view a number of the aspects touched upon in Harvey and Williams are compelling. Firstly, in this case an objection is taken by one of the parties. In those circumstances, great care indeed must be taken by a judicial officer before deciding to continue with the matter over the objection of a party in the exercise of discretion. [23] The second feature, referred to by Campbell J. in Harvey, relates to matters unconsciously entering the judicial mind. In this matter I cannot honestly say that the terms of the Offer to Settle will not unconsciously have an impact on me if I proceed to give final judgment. I certainly believe that I can consciously put the Offer to Settle out of my mind, but that is not the point that Campbell J. makes. This issue is compounded by the fact that my preliminary views as to my judgment which I was formulating in order for delivery on the week after the improper material came to my attention very closely mirrored the contents 8 [1965] QWN 41 9 There is a curious aspect to Harvey and Ors v Harvey that should be noted. An electronic search of cases which have considered Harvey and Ors v Harvey will reveal the case of Williams v Volta [1982] VR 739. An online search of that case will find in the headnote the following words between two commas “, not followed Harvey and Ors v Harvey,”. This certainly gives the casual reader the impression that Williams does not follow Harvey. That is however not the case as a careful reading of Williams reveals. The position is clarified if one refers to the trusted account in the authorised report rather than an online search. In the authorised Supreme Court of Victoria Reports for 1982 the headnote is in the following terms: “Murphy v. Murphy, [1963] V.R. 610; Schulte-Hordelhoff v. Patons Brake Replacements Pty. Ltd., [1965] V.R. 369, not followed. Harvey v. Harvey, [1965] Q.W.N. 41; Millensted v. Grosvenor House (Park Lane) Ltd., [1937] 1 K.B. 717; [1937]1 All E.R. 736, referred to.” -- 15 of 18 -- of the Offer to Settle and Annexure. That knowledge makes it more difficult to consciously put such material out of one’s mind, let alone subconsciously. [24] Furthermore, the issue of perception of justice must also be heeded. Suppose that I did deliver judgment in terms substantively similar to the conclusions I had reached as at 24 October 2001 in terms very similar to the Offer to Settle and Annexure. The casual observer, on viewing the terms of such a judgment and orders made beside the contents of the Offer to Settle would, I expect, take some convincing that the judgment had not simply followed the Offer to Settle. [25] It is one of the cornerstones of the legal system that perceptions of justice are held dear to all. I cannot and will not tolerate a situation to unfold where the perception would rightly be that I had been influenced by improper material whether or not that were actually the case. The mere perception in these circumstances to me is enough. Coupled with the objection by the Respondent to my continuing in this matter, and the views of Campbell J. regarding unconscious thought, I find myself in the position where I have no option but to disqualify myself from further considering this matter. [26] As I observed in my overview at the commencement of this judgment, I have little doubt that my decision will cause hardship to the parties. That is clearly regretted. For my own part, I feel cheated of the opportunity to deliver my judgment in this matter for, in a very real sense, the hard work had been done, the research had been completed, the mere formal finalisation of the judgment was all that was required. [27] I note in particular the concerns of the Applicants expressed in their submissions regarding the issue of costs. I expect that the quantum of costs to date in this matter would be substantial. It will of course be a matter for another Presiding Member to determine how to now proceed with this matter given my decision10. Depending upon what procedural decisions the next Presiding Member takes in this matter, I note that section 22(1)(c) of the Appeal Costs Fund Act 1973 may be invoked. If those circumstances arise, the parties’ costs will be recoverable 10 For an analysis of relevant considerations in such circumstances see Sullivan & Anor v Oil Company of Australia & Anor [2000] QLRT 3. -- 16 of 18 -- as the circumstances in this case are clearly “not attributable in any way to the act, neglect or default, in the case of civil proceedings, of any of the parties thereto or their legal representatives”. If the Presiding Member decides to continue hearing the matter on the basis of the material properly before me, then the parties will not have thrown their costs away. [28] I also note that it is not necessary in determining the credit of witnesses for a judicial officer to physically see the witness giving evidence11. Orders [29] In light of the above, I make the following Orders: 1. I order that the inappropriate material contained within Land and Resources Tribunal File No OTX70001/2001 be removed from the filed copy of the amended Application to Start Proceedings of 5 July 2001 and placed in a separately sealed envelope and held in the safe custody of the Registrar with an extract of this Order appearing on the front of the said envelope. 2. I order that the inappropriate material contained within copy material held in my Chambers relating to Land and Resources Tribunal File No OTX70001/2001 be removed from the copy of the amended Application to Start Proceedings of 5 July 2001 and placed in a separately sealed envelope and held in the safe custody of the Registrar with an extract of this Order appearing on the front of the said envelope. 3. I disqualify myself from the further consideration of this proceeding. 11 See the views of Kirby, J. in State Rail Authority of New South Wales v Earthline Constructions Pty Ltd (1999) 160 ALR 588 at 617; 73 ALJR 306: “There is a growing understanding, both by trial judges and appellate courts, of the fallibility of judicial evaluation of credibility from the appearance and demeanour of witnesses in the somewhat artificial and sometimes stressful circumstances of the courtroom. Scepticism about the supposed judicial capacity in deciding credibility from the appearance and demeanour of a witness is not new. In Sociètè d'Avances Commerciales (Sociètè Anonyme Egyptienne) v Merchants’ Marine Insurance Co (The Palitana) (1924) 20 LI L Rep 140 at 152 Atkin LJ remarked that “an ounce of intrinsic merit or demerit in the evidence, that is to say, the value of the comparison of evidence with known facts, is worth pounds of demeanour”. -- 17 of 18 -- 4. I order that the Land and Resources Tribunal File No OTX70001/2001 and relevant material held in my Chambers, together with a copy of my decision in this matter, be referred to the President of the Land and Resources Tribunal for his further action. -- 18 of 18 --