Mediation and Arbitration Chambers

On 2 December 2010, the Senate Standing Committee on Legal and Constitutional Affairs provided its report on proposed amendments to the Civil Dispute Resolution Bill 2010 (CDR).

The object of the CDR is to ensure that people take ‘genuine steps’ to resolve disputes before instituting civil proceedings in the Federal Court or Federal Magistrates Court. The aim of the Bill is to:

  • change the adversarial culture often associated with disputes;
  • focus on resolution before parties become entrenched in litigation;
  • ensure that, where disputes proceed to court, the issues are properly identified, thereby reducing the time required for determination.

Most controversial was whether parties to a dispute, needed to show that they had taken genuine steps, as the Bill proposed, or rather reasonable steps as is used in the Victorian Civil Procedure Act 2010 and is proposed for amendments to the NSW Civil Procedure Act 2005. It was argued that the¬†use of the term ‘reasonable steps’ was more certain and less likely to lead to disputes of interpreting comparative legislative provisions. Despite a contrary written view by the two Liberal Senators on the committee that the term ‘reasonable steps’ should be preferred, the committee took the bold move of endorsing the recommendation of NADRAC, that the Bill require a ‘genuine’ effort to be made by disputing parties.

In summary, the committee recommended that, subject to the recommendations in relation to the definition of the word ‘genuine’, the consideration of position of disadvantaged litigants and the protection of the privacy of documents, that the Senate pass the Bill.

The committee conclusions and recommendations from the report are set out below.

Conclusions

3.58 The committee notes that the Civil Dispute Resolution Bill 2010 is part of the government’s moves to improve access to justice. It also reflects a cultural shift in how the position of the courts is perceived in the justice system. Through the ‘genuine steps’ obligation, the Bill aims to support the resolution of certain civil disputes in the Federal Court and the Federal Magistrates Court before litigation is commenced. The committee considers that the introduction of this obligation is an important initiative in ensuring that there is a focus on resolving a matter before costly and time consuming litigation is undertaken. Even when matters are not resolved, there will be a benefit to parties as the issues in dispute will be clarified and narrowed.

3.59 The committee has carefully considered arguments that the Bill introduces mandatory pre-action protocol. The committee is satisfied that this is not the case. Rather, while it is obligatory to provide a genuine steps statement, the Bill provides flexibility to the parties to determine the steps that they wish to take to resolve their dispute and allows for circumstances when genuine steps cannot be undertaken. The Bill provides examples of genuine steps but does not mandate those that should be taken. This is the case with ADR: although witnesses focused on mandatory ADR, the Bill only provides ADR as an example of a genuine step, not a mandated step.

3.60 However, the committee believes that the Bill would benefit from the addition of an inclusive definition of ‘genuine’ to better reflect the intention of the NADRAC report and to provide guidance to the parties involved.

Recommendation 1

3.61 The committee recommends that the Bill be amended to provide for an inclusive definition of the word ‘genuine’ to better reflect the intention of the National Alternative Dispute Resolution Advisory Council report.

3.62 The committee has also considered the extensive discussion in evidence in relation to the exclusions to the genuine steps obligation. The committee is satisfied that the list of exclusions is appropriate and that, as indicated by the Department, should the need arise, further additions to the list can be made through regulation.

3.63 In relation to disadvantaged litigants, the committee has noted the comments by the Attorney-General’s Department and NADRAC that disadvantaged litigants may benefit from less stress, cost and delay through the genuine steps obligation. In addition, disadvantaged litigants will benefit from the additional resources provided by the Australian Government through its Access to Justice measures. However, the¬†committee considers that the Bill should be amended to ensure that disadvantaged people benefit from the proposed regime and are not further disadvantaged or denied access to justice by ensuring that the court, in considering the genuine steps taken by a person when it is exercising its powers or performing its functions, takes into account the circumstances of disadvantaged litigants.

Recommendation 2

3.64 The committee recommends that the Bill be amended so that the court, when taking into consideration the genuine steps that have been taken by a person when it is exercising its powers or performing its functions, also takes into account the circumstances of disadvantaged litigants.

3.65 The committee has also noted the concerns raised by the Castan Centre for Human Rights Law and the NSW Department of Justice and Attorney General in relation to the disclosure of information and the possible interference with a right to privacy. The committee considers that the Bill would be improved if it contained provisions to ensure that information disclosed cannot be used for any purpose outside the resolution of the dispute at hand.

Recommendation 3

3.66 The committee recommends that the Bill be amended so that information disclosed during the genuine steps obligation cannot be used for any other purpose outside the resolution of the dispute at hand.

3.67 As a final matter, the committee was concerned about the comments made in evidence in relation to the consultation undertaken by the Department before the Bill was introduced. While many stakeholders contributed to the NADRAC report, the committee considers that the Department would have been well served by engaging more thoroughly with stakeholders before the Bill was introduced in the Parliament.