Commonwealth of Australia Explanatory Memoranda

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ACCESS TO JUSTICE (CIVIL LITIGATION REFORMS) AMENDMENT BILL 2009

                                  2008-2009







               THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA







                                   SENATE




                ACCESS TO JUSTICE (CIVIL LITIGATION REFORMS)
                             AMENDMENT BILL 2009





                   ADDENDUM TO THE EXPLANATORY MEMORANDUM






              (Circulated by authority of the Attorney-General,
                    the Honourable Robert McClelland MP)













Insert the following text after paragraph 8 in the general outline - Since
the Bill was introduced on 22 June 2009, the decision of J L Holdings
(1997) 141 ALR 353 has been reconsidered by the High Court by the decision
in Aon Risk Services Australia Limited v Australian National University
[2009] HCA 27 (5 August 2009).  In the Aon case their Honours held that, to
the extent that statements about the exercise of the discretion to amend
pleadings in J L Holdings suggested that case management considerations are
to be given little weight, it should not be regarded as authoritative.

Further, their Honours noted that 'in the past it has been left largely to
the parties to prepare for trial and to seek the court's assistance as
required.  Those times are long gone' (paragraph [113]).

The High Court's decision in the Aon case lends support to the case
management provisions introduced in Schedule 1 of this Bill.

Insert the following text after paragraph 23 - The Senate Standing
Committee on Legal and Constitutional Affairs report on the Bill
recommended that the Government clarify the operation and purpose of
subsection 37N(1).

    Subsection 37N(1) includes negotiations for settlement.  During the
    Committee's inquiry, concern was expressed that the application of the
    overarching purpose to settlement negotiations may abrogate the
    settlement privilege in the event that the Court was considering making
    a cost order for failure to comply with the overarching purpose under
    subsection 37N(4).  The Senate Committee was concerned that the
    privilege should not be removed.


    For the overarching purpose to achieve the intended aim of changing
    the way parties approach the resolution of disputes, it is important
    that it applies to all aspects of the proceedings, including settlement
    negotiations.    


    The settlement privilege is provided for both at common law and in
    section 131 of the Evidence Act 1995.  However, the privilege only
    applies where a genuine attempt is being made to reach a settlement.
    Parties who are making a genuine attempt to reach a settlement are
    likely to be acting consistently with the overarching purpose. 

    Further, the privilege provided for in section 131 of the Evidence Act
    specifically does not apply when 'the communication or document is
    relevant to determining liability for costs': paragraph 131(2)(h).  The
    application of this exception, and evidence law principles more
    generally, will be a matter for the Court to assess when exercising the
    discretion to make a cost order under subsection 37N(4).