Tuesday, February 28, 2012

Forgetting To Tell Centrelink About A Change Of Circumstances

Omissions Under the Commonwealth Criminal Code : Social Security Act Offences

The highly-anticipated High Court decision in CDPP v Poniatowaska may have come a little too late, since the government has changed the laws, but the principles set out by the court relating to establishing the physical elements of an offence under the Criminal Code remain relevant.

The High Court's decision in Commonwealth Director of Public Prosecutions v Poniatowska1 affirms the long-held principle that there should be a high burden upon prosecutors in criminal cases to prove every element of an offence, especially when the act complained of is said to be an omission.

The case involved a recipient of Centrelink benefits who failed to inform Centrelink of income (by way of commission) which she had earned. The crucial question raised (and ultimately answered) was: 'what exactly are the physical elements that need to be established when a person is charged with obtaining a financial advantage under the Criminal Code Act 1995 (Cth)?' The High Court (by a 4-1 majority, Heydon J dissenting) dismissed the Commonwelath Director of Public Prosecutions' (CDPP) appeal from the Supreme Court of South Australia.

But in anticipation of the High Court's decision, in July 2011, the Commonwealth government amended the social security legislation dealing with this issue, including making such amendments retrospective in nature.2 The amendments closed the loophole left open after the full court of the Supreme Court of South Australia's decision which led to the CDPP placing more than 16,500 social security fraud cases on hold.

Had the government not passed the amending legislation, the High Court's decision would have had widespread implications for the government and recipients of Centrelink benefits across the nation, as well as for persons previously convicted of social security fraud.

However, the new s.66A of the Social Security (Administration) Act (Cth) now explicitly provides for the requirement to notify Centrelink of a change in circumstances within 14 days of such change occurring, thereby codifying the relevant omission to be relied upon in future similar prosecutions of this nature.
And as Heydon J (in his dissent) noted, "It is common for decisions of courts to be reversed by the legislature after they have been delivered. It is less common for this to take place even before they have been delivered. Yet the legislature has got its retaliation in first in relation to this appeal."3

Background

The controversy began with Ms Poniatowska's failure to report employment income to Centrelink over the period 30 August 2005 to 30 May 2007. Poniatowska did not declare seventeen payments received in connection with her previous employment as a sales consultant, totalling $71,502. She also subsequently received payments of the Parenting Payment Single to which she was either not entitled or only partially entitled, totalling $20,162.58.

In the Magistrates Court of South Australia, Poniatowska pleaded guilty to seventeen charges of obtaining a financial advantage contrary to s.135.2 of the Criminal Code, for which she received a 21-month suspended sentence.

Poniatowska lodged a severity appeal to a single judge of the South Australia Supreme Court against the magistrate's sentence. The appeal was dismissed and Poniatowska then appealed to the full court. While originally only an appeal against the sentence, the grounds of appeal were subsequently amended and the appeal was dealt with as against both conviction and sentence.

Supreme Court of South Australia full court

The appeal was allowed (by a majority 2-1) and the full court set aside the convictions in August 2010.4
The majority (Doyle CJ and Duggan J) adopted a strict interpretation and application of the relevant provisions, namely s.135.2 should be read together with s.4.1 and s.4.3 of the Criminal Code (Cth).
Their Honours considered the definition of "engage in conduct" in s.4.1 and the provision that "engages in conduct" constitutes a physical element of the offence (s.135.2). Section 4.1 defines "engage in conduct" as doing an act or omitting to perform an act. Given this, their Honours concluded that an offence under s.135.2 could be committed by an omission.5

Their Honours then turned to the common law and the established general principle that there can be no criminal liability for an omission unless the conduct constitutes a failure to perform a legal obligation. Therefore, a relevant duty arising under the general law or statute must first be identified before establishing whether there had been a breach by way of omission.

The majority held that the duty or obligation can only arise under s.135.2 of the Code itself or a provision of the Social Security (Administration) Act 1999 (Cth). In this respect, Poniatowska was reminded in numerous letters of her ongoing obligation to advise Centrelink of any income received and was under fortnightly reporting obligations but it was unclear whether any formal notices under the Social Security (Administration) Act were issued.

The CDPP did not rely on any provision in the Social Security (Administration) Act to establish a duty of disclosure in these types of cases but argued that, in any case, the obligation not to obtain a benefit by means of omissions was created by s.135.2 itself.

The full court rejected this argument. The majority considered, among other things, the practical difficulties in following the CDPP's argument.

First, the majority held that s.135.2 did not make an omission to perform an act a physical element of the offence, as the omission is not identified in such a way that it creates a duty to perform the act. Their Honours reasoned that it would be impossible to identify the omission that attracts criminal liability - the link between the omission and obtaining a financial advantage was too unclear.

Given this lack of defined duty or obligation in s.135.2 and the failure of the CDPP to rely on any notice issued to Poniatowska (or any provision in the Social Security (Administration) Act) to establish a duty, the majority concluded that the court should set aside Poniatowska's convictions which, in law, could not be upheld.

Sulan J (dissenting) did not follow this strict interpretation of the legislation and instead took into account the legislative history of s.135.2. His Honour noted statutory interpretation requires the court to have regard to the context in which the words arise and their statutory purposes, and that the meaning of a provision is the meaning that the legislature has intended for them to have.

His Honour referred to the "Theft, fraud, bribery and related offences" report prepared by the Model Criminal Code Officers' Committee in 1991. In discussing the need for a general dishonesty offence, the committee had concern regarding situations where there will be no offence in the nature of deception shown but where there will be clear dishonesty. The committee cited the particular example of the defrauding of social security payments where the recipient fails to inform of a change in circumstance rendering the benefit no longer payable.

In enacting the legislative amendments, Parliament had regard to the committee's report and, interestingly, such amendments included the Criminal Code Amendment (Theft, Fraud, Bribery and Related Offences) Act 2000 which introduced s.135.2.

Sulan J reasoned that the intention of the legislature in enacting s.135.2 was to overcome the very issue identified by the majority, being the requirement for a duty to be identified when an individual fails to disclose they are obtaining a financial advantage in such cases. His Honour concluded that s.135.2 does not require the court to look to a duty of disclosure, whether by statute or common law, further than to what is provided in that section. In His Honour's opinion, the causative link between the omission to inform the relevant department of a change in circumstances and the resultant financial advantage was sufficient to satisfy the physical element of the offence.

The CDPP's appeal to the High Court

An application for special leave to appeal was expedited to the November 2010 special leave sittings of the High Court of Australia before Chief Justice French and Justice Gummow, where it was ordered that the application be referred to the full court for argument as if on appeal.6

Ultimately, the High Court granted special leave to appeal but dismissed the appeal with costs. The court held by majority (French CJ, Gummow, Kiefel and Bell JJ; Heydon J dissenting) that the law creating the offence in s.135.2(1) does not make the omission of an act a physical element of the offence, either expressly or impliedly, within the meaning of s.4.3(a) of the Code.

The majority drew attention to the need to identify a specific omission. Written submissions and oral argument for the Department of Public Prosecutions failed to identify the act that was omitted, and also when it was alleged that the omission occurred.

The majority noted the difficulty in moving from the assertion that Poniatowska knew she had an obligation to advise Centrelink to the identification of the omission to perform an act.

A strict interpretation of s.135.2(1)(a) and s.4.3 was applied. That is, the general principle expressed in s.4.3 does not extend to criminalising the omission of any act which can be causally connected to a particular result of the conduct.7

The majority held: "If the law creating the offence does not criminalise the failure to do a thing (the exception to the general principle stated in s.4.3(a)) and if that failure is not the breach of a duty imposed by the law (the exception to the general principle stated in s.4.3(b)) it is difficult to characterise the fact that a person does not do the thing as the omission of an act.

"[S]enior counsel for the appellant was unable in written submissions or in the course of oral argument to identify the act that was omitted, other than to say that the respondent 'failed to advise Centrelink of a payment of a commission received by her while she was in receipt of a Parenting Payment Single'. When pressed to identify when it was alleged the omission occurred in respect of a given charge, counsel responded by saying 'between receiving the commission and the receipt of the advantage'. The difficulty lies in moving from the generalised assertion, that the respondent knew she should advise Centrelink, to the identification in each count of the omission to perform an act.

"Section 135.2(1)(a) allows that the offence is one that may be committed by the omission to perform an act but the provision does not proscribe the omission of any specified act. The law creating the offence does not make the omission of an act a physical element of the offence within the meaning of s.4.3(a)."8

In dismissing the CDPP's appeal, the majority held that "the exceptions to the general principle that it [s.4.3 of the Code] states do not extend to criminalising the omission of any act which is able to be causally related to a result of conduct".9

As noted above, this case would have had widespread ramifications. And as Gummow J stated in the special leave sitting, this is a "major point of principle which involves a lot of money to the Commonwealth".10

(*Extracted from the article by L Geary & M Wong in NSW LSJ, February 2012)

ENDNOTES
  1. [2011] HCA 43.
  2. Social Security and Other Legislation Amendment (Miscellaneous Measures) Act 2011 (No. 91, 2011) s.2 (retrospective to 20 March 2000).
  3. Above n.1, at 45.
  4. Poniatowska v DPP (Cth) [2010] SASCFC 19.
  5. Ibid at 12.
  6. Commonwealth Director of Public Prosecutions v Poniatowska (A20/2010).
  7. Above n.1, at [36] and [43].
  8. Ibid at [35]-[37].
  9. Ibid at [44].
  10. Commonwealth Director of Public Prosecutions v Poniatowska [2010] HCATrans 304.

Saturday, February 18, 2012

What is defamation?

At its simplest, defamation is to spread bad reports about someone which could do them harm.
The verb is to defame. You can defame someone if you say something false about them which spoils their good reputation, which makes people want to avoid them or which hurts them in their work or their profession.
To defame someone, you do not have to make up false things yourself. You might defame a person by repeating or replaying words spoken by someone else, for example an interviewee. It is no defence to claim that you were only quoting someone else. If you print or broadcast something defamatory, you could be taken to court, along with your producer, your editor or station manager and the person who said the words in the first place.
Before January 2006, defamation varied from state to state across Australia, but now there are Uniform Defamation Laws which are similar across all states and territories. The uniform laws adopted and adapted a number of statutory provisions from old laws but still retain the basic principles of common law, which traditionally defines defamation as:
The publication of any false imputation concerning a person, or a member of his family, whether living or dead, by which (a) the reputation of that person is likely to be injured or (b) he is likely to be injured in his profession or trade or (c) other persons are likely to be induced to shun, avoid, ridicule or despise him.
Publication of defamatory matter can be by (a) spoken words or audible sound or (b) words intended to be read by sight or touch or (c) signs, signals, gestures or visible representations, and must be done to a person other than the person defamed.
If a person thinks that you have defamed them and takes you to court, they have to prove that three of these things have happened:
  • That the words were capable of a defamatory meaning as understood by ordinary members of society. Defamatory meaning could be anything which harms the person, in their reputation, their business or in the way other people treat them. The law does not say that the plaintiff must show actual proof of being harmed; it is enough that the false statement could have led to harm.
  • That the words identify him as the person defamed. It is not necessary that he should have been specifically named. If he can show the court that a reasonable person would take the words to refer to him, he will probably have a good case. Groups of people (such as small companies or not for profit associations) can sue for defamation if they can demonstrate that the words identified them as a group.
  • That the words or pictures have been published, that is heard or seen by a third person. The first person is the one talking or writing (you), the second person is the person being talked or written about (the plaintiff), the third person is anyone else who may hear or read the offending matter (such as a reader or listener). There is no civil defamation if the words, however bad or untrue, are spoken or written only to the person about whom they are made.
Who can sue?
Under the old system of individual state laws, almost anyone or any organisation or company could bring an action for defamation. However, under the Uniform Defamation Law, corporations with 10 or more employees cannot sue. However, be warned that individuals or groups of individuals employed by or associated with that corporation - such as company directors, CEOs or managers - can still sue if they are identified by the publication.
Not-for-profit organisations can still sue for defamation, no matter how many employees or members they have.
Defences
It may seem that the laws of defamation are heavily against the media, but there are several defences which you can use to keep out of court or, if you are taken to court, to keep you from losing the case. Under the law, you as the publisher or broadcaster have to provide the evidence to support any of the following defences.
Truth
Truth (which is also called justification) is probably the best defence. Formerly in some states (such as NSW, Queensland, Tasmania and the ACT) truth was only a defence if you could prove that a ‘public interest’ was served by publishing the defamatory words. This requirement has been dropped from the Uniform Defamation Law and now there is a defence if the defendant can prove that the defamatory imputations are substantially true.
Privilege and protected reports
The law recognizes that there are times when there has to be complete freedom of speech without any risk of claims for defamation. The two main examples are in parliaments and courts. MPs speaking in parliament or people speaking in court proceedings are protected from defamation by absolute privilege which means they cannot be sued whatever they say or whatever their motive for saying it. Your reports of such proceedings are usually protected by qualified privilege. Protection only usually applies as long as your report is honestly broadcast for the information of the public or the advancement of education and is reasonable. For example, does it distinguish between suspicions, allegations and proven facts?
Because common law does not protect freedom of speech in other situations, the uniform law has extended the protection of privilege to cover reports published reasonably of a whole host of public events, functions and bodies ranging from tribunals and commissions of inquiry to official documents kept as public records, such as Hansard or land titles. Reports published reasonably of meetings of local councils are usually protected, as are reports of public meetings dealing with matters of public interest. The legislative acts of each state contain schedules of bodies and publications to which absolute privilege apply.
Replies to a public attack may also be protected by qualified privilege, as long as the reply is restricted to the specific matter of the original accusation.
Honest opinion
To use the defence of honest opinion you do not need to prove the truth of your comment. In some cases this is not possible, especially if it is an opinion rather than a fact. You only need to convince the judge or jury that your comments were your honestly-held opinion and that it was:
  • clearly a matter of opinion and not a statement of fact and
  • it related to a matter of public interest and
  • it was based on ‘proper material’ (i.e. substantially true or based on privileged material)
The defence can be defeated if the plaintiff can prove that the opinion was not honestly held.
Political debate
Two rulings by the High Court introduced a new defence based on what the judges saw as an implied freedom of speech in the Constitution. The High Court decided (by a majority decision) that in order for democracy to work, we must be allowed to say defamatory things about people engaged in political debate without fear of being sued if they prove to be untrue.
The defence is similar to the so-called "public figure defence" available in the United States, but only applies in cases of genuine political discussions (which the High Court left lower courts to define) and it cannot be used to defame people simply because they are in the public eye.
The High Court in the Lange case further defined the conditions under which this defence can be used. It said the matter must be on a government or political issue, must not be motivated by malice (which we explain later) and publication must be reasonable. To prove reasonableness, you will have to prove:
  • You had reasonable grounds for believing it was true,
  • You took proper steps to check the accuracy of the material,
  • Where practicable, you sought a response from the person defamed.
Innocent dissemination
Journalists occasionally defame someone without knowing or intending it. In such a situation, you might be able to use the defence of innocent dissemination (sometimes called unintentional defamation).
Ethically, broadcasters or publishers should be committed to correcting unintentional mistakes which might do someone harm so will probably issue a suitable correction and apology. Because publishing a correction and apology is admitting that you did defame the person concerned, you must always get advice from the your organisation's lawyers before doing it.
The Uniform Defamation Law has quite detailed provisions for settling defamation matters through mutual agreement between plaintiff and defendant, without having to resort to long and costly court cases. Your organisation's lawyers should be well informed of these provisions for a reasonable settlement. Consult them.
Triviality
It is a defence if the defendant can prove that the circumstances of the publication were such that the plaintiff was unlikely to sustain any harm.
The plaintiff agreed to publication
You cannot defame someone if they have given their consent for you to publish or broadcast the defamatory material. Consent usually means that they said: "Yes, you can use those words." This law stops people tricking journalists into publishing defamatory material so they can later sue. You may also have a defence if, having been told exactly what was to be said, the plaintiff made a statement explaining his side, and that statement was included in your report.
The matter has already been judged
It is a principle of common law that courts will not hear a second case based on the same complaint against the same defendant. If you have been cleared already, the plaintiff cannot have a second try using the same imputation. However, if you repeat the words again in broadcasts after court proceedings have started, this would be a separate publication and could result in another action. Beware also of repeat broadcasts; these will be counted separately and may offer a plaintiff a second chance of suing for defamation.
The plaintiff has died
An action for defamation is a personal action. Dead people cannot sue for defamation; neither can an action begun by a plaintiff be continued by his children or family if he dies before the case comes to court. The action dies with him.
There is, however, provision for the relatives of a dead person to sue for defamation on their own behalf if they are defamed by what you say about their dead relative.

The statute of limitations has expired
The Uniform Defamation Law requires that a plaintiff must commence proceedings for defamation within a year of publication or broadcast. However, courts may extend this to up to three years if the plaintiff can demonstrate there were good reasons why they could not start the action within a year.
Apologies and resolution of civil disputes without litigation
These are not, strictly speaking, defences. However, as mentioned earlier, the law lays down some quite specific mechanisms by which apologies can be accepted and complaints about defamation can be resolved without resorting to the courts. This is, of course, a matter for your newspaper or broadcasting company to decide and therefore you should obtain legal advice before such a course of action is started.
Malice
One final warning about the legal concept of malice:
To use the defences above you must usually show that publication was made "in good faith, without ill-will". Ill-will is usually referred to in law as malice, and includes any dishonest or improper motive. For example, to broadcast a critical comment to get revenge would be seen as malice. If the court decides that you acted with malice, you will lose your defence and could face a charge of criminal defamation, which can be punished by a fine or imprisonment.
How is defamation punished?
Defamation is usually a civil offence in Australia, although it can be a criminal matter in some circumstances.
Civil defamation
Most complaints of defamation are dealt with under civil law. That means that cases go to a civil court and are punished by awarding money (called damages) against the person found to have committed the offence. In civil defamation, the principle is the same as for someone who has been physically injured as a result of someone else's actions, either through carelessness or a planned attack.
Under the uniform law, it is usual for juries to determine whether defamation took place and whether the publisher or broadcaster has a defence. If defamation is proved and there is no acceptable defence, the judge will decide how much harm has been done and express that in the amount of damages they award. There are several kinds of damages:
  • General or compensatory damages, which a court may award for a person's loss of reputation, shame or hurt feelings. Under common law, once the court has found that he has been defamed, the plaintiff does not have to prove that actual harm has been done. General damages do not have to be large sums of money. If a judge or jury finds that you have defamed the plaintiff but that no real harm has been done, the plaintiff may be awarded nominal damages of a few dollars. Nominal damages may also be awarded if the court feels that you have been only slightly at fault or that the plaintiff was in some way responsible for the defamation in the first place.

  • Special damages compensate for any loss of business or earnings the plaintiff may have suffered as a result of the defamation. These could also include any money the plaintiff has spent as a result of the defamation, for example in sending letters to clients denying the allegations.

  • Aggravated damages can be awarded if the court thinks that the defamation was deliberate, possibly out of ill-will or any other improper motive (usually referred to as malice, which we discussed earlier). For example, if you knew that what you were publishing was false and defamatory, but went ahead with the story to stir up a scandal and boost readership or listener numbers, the court would probably award aggravated damages against you. They may also award aggravated damages if the defamation was said in a particularly nasty way.
Damages are usually large in the case of media organisations because the courts think that they can pay more for their mistakes than individuals can.
As in any court case, the judge may also award costs against you if you lose (or against the plaintiff if they lose), or simply say that each side should pay their own costs of the case.

Monday, February 13, 2012

Recent Decisions: Family Law, Criminal Law & Civil/Commercial Law

Family Law Decisions

Property - “Add backs” - Pre-separation expenditure

In Mayne [2011] FamCAFC 192, the full court set aside Neville FM’s decision to add back a $173,000 inheritance the wife gave away or spent when she was “heavily in debt”. Faulks DCJ said at paras 77-78 as to expenditure before separation: “while parties are together, each might, from time to time and with the consent of the other, either express or implied, apply or appropriate assets or funds to his or her own purposes. When the relationship is good, no one is likely to care - let alone keep records … it is not the Court’s function to conduct an audit of the marriage or of the relationship finances.

Strickland J disagreed, and May J (paras 106-107) said “the better course would have been for the [FM] to have considered the … [expenditure for which “there was no proper account”] in determining the proper percentage to be attributed to the parties by reason of their contributions during the marriage”. 


(From the Editors of The Family Law Book)

Children - order for immunization set aside.

In Mains & Redden [2011] FamCAFC 184, Coleman J at para 136 set aside Dunkley FM’s order that a child be immunised as medical evidence admitted by ColemanJ, if accepted, suggested “that, whatever it’s magnitude, there was a measure of risk of the child suffering a significant reaction to immunisation, and certainly, a risk significantly greater than that found by [Dunkley FM]”.


(From the Editors of The Family Law Book)

Property - $1.3 million loan from husband’s father not deducted from pool - Resulting trust claim also failed

In Liakos & Zervos and Anor [2011] FamCA 547, the parties were married for 13 years. Of their $663,000 asset pool, the husband’s father sought a declaration of equitable ownership of two properties (total value $525,000) one of which he bought in his son’s name. The other was bought by his son with finance paid out by the father. The father also sought a declaration that his son owed him $1.5 million. Loughnan J dismissed both applications, referring at paras 139-150 to case law in support of the court’s power to ignore debts for which it felt one party should bear sole responsibility. Loughnan J at paras 195-205 reviewed case law relevant to resulting trusts, finding that the evidence pointed to the presumption of advancement applying in favour of the husband. 


(From the Editors of The Family Law Book)

Property - Consent order and financial agreement not set aside despite wife’s fraud

In Nyles [2011] FamCA 565, the husband and wife entered into a property settlement by way of consent orders and a financial agreement. At that time the wife was a director of a private company engaged in the process of floating as a public company on the stock market. The float resulted in a vast increase in the value of the wife’s shares in the company “which she realised to achieve a large windfall”. Mushin J dismissed the husband’s applications under s. 79A and 90K of the Family Law Act for orders setting aside the consent orders and financial agreement.

Mushin J at paras 124-130 discussed the duty of “full and frank disclosure” as to both contested proceedings and consent orders, finding at para 174 that her failure to update her financial statement and valuation amounted to a fraudulent misrepresentation, but that the husband had not relied on that misrepresentation resulting in a miscarriage of justice under s. 79A as he knew a float of the company was “imminent”, believed that the shares had “significant value” and had been advised not to settle until an up-to-date valuation had been conducted. Mushin J also found that the financial agreement had not been obtained by fraud within the meaning of x.90K. 


(From the Editors of The Family Law Book)

Financial agreement - Rectification denied - Unilateral mistake.

In Sullivan [2011] FamCA 752, the husband applied for the rectification of a financial agreement by changing references to s.90B to 90C of the Family Law Act and a declaration that the agreement was a financial agreement under s.90C. The wife deposed that she signed the document under coercion from the husband two days before the parties’ wedding. The husband signed it three days after the wedding. Both certificates of legal advice referred to “the agreement proposed to be entered into” by the parties. Young J found at para 138 that it was “not apparent that there was a common intention to enter into an agreement under s.90c of the Act”. As to rectification, Young J said, “the matter before the Court is distinct from both Senior v Anderson [[2011] FamCAFC 129] where there was a common mistake., and Ryan v Joyce [2011] FMCAfam 225 where there was a unilateral mistake known to the husband before he signed the agreement. In the matter before the Court there was no common mistake and therefore no common intention to give rise to rectification as a remedy.”


(From the Editors of The Family Law Book)

Child Support - Applicant declared not the child’s father.

In Levine [2011] FMCAfam 821, the applicant was granted a declaration under s.107 of the Child Support (Assessment) Act that he should not be assessed for child support as he was not the child’s father and an order under s.143 of the Act that the respondent repay him $13,000 paid by him to the CSA, and costs in the sum of $6,000. Scarlett FM held that the court had no jurisdiction to order repayment of the $5,400 paid under a voluntary agreement made prior to the administrative assessment. (See also Radcliffe & Hall (See also Radcliffe & Hall [2011] FMCAfam 781.)


(From the Editors of The Family Law Book)

Child support - SSAT appeal - “Care of child” not living with either parent

In Polec & Staker & Anor (SSAT Appeal) [2011] FMCAfam 959, Hughes FM allowed the father’s appeal against the Social Security Appeals Tribunal decision to affirm the Child Support Registrar’s decision that the departure of the child (born in 1992) form his mother’s home to take up an apprenticeship did not constitute a child terminating event or a significant reduction in the mother’s care percentage. 


(From the Editors of The Family Law Book)

Maintenance - Bankrupt spouse may apply for variation of maintenance order

In Blake [2011] FMCAfam 796, the husband, who was declared bankrupt on his own petition six months after an interim maintenance order was made against him, was allowed to apply for a discharge of the order. Connolly FM held “that, despite bankruptcy, a bankrupt party has standing to bring an application under the [FLA} … that [is] personal in nature … which do[es]  not affect the quantum of the bankrupt estate”. 


(From the Editors of The Family Law Book)

Civil/Commercial Law Decisions

Corporations
Reinstatement and winding up of deregistered companies.

In ACN 078 272 867 Pty Ltd (in liq) v Deputy C of T [2011] HCA 46 (2 November 2011), Heydon J considered whether deregistered companies had any right to be heard on an application by the Commissioner of Taxation for re-registration of a deregistered company and an order that the company then be liquidated and whether any right of hearing would have altered the result. He considered when re-registration occurred. Application for constitutional writs to quash reinstatement orders of the Federal Court dismissed. 

(From the Case Notes of Thomas Hurley)

Precedent
Status of Codelfa Construction Pty Ltd v State Rail Authority NSW

In Western Export Services Pty Ltd v Jireh International Pty Ltd [2011] HCA 45 (28 October 2011) in considering for an application for special leave the Court (Gummow, Heydon, Bell JJ) reiterated that the doctrine of precedent required intermediate courts apply the decision in Codelfa Construction Pty Ltd v State Rail Authority [1992] HCA 24 (1982) 149 CLR 337 as to the admissibility of surrounding circumstances until the High Court reviewed the decision. Special leave refused

Criminal Law Decisions

Trial Directions to Jury
Assessing witnesses
Assessment of “Interest” of witness in result

In Hargraves v Q [2011] HCA 44 (26 October 2011) the High Court reiterated that the primary function of the trial judge was to ensure that the jury was focused on assessing the evidence to determine guilt beyond reasonable doubt. The appeal concerned comments by the trial judge, in the charge, that the jury should, in assessing the evidence of the accountant called by persons accused of defrauding the Commonwealth by entering a tax scheme, consider whether the accountant had an interest in the outcome of the trial. The High Court concluded that comments would not have deflected the jury from its task. Consideration of whether the decision in Robinson v Q [1991] 180 CLR 531 (1991) HCA 38 established a new doctrine or re-stated established principle. Appeal dismissed: French CJ, Gummow, Hayne, Crennan, Kiefel, Bell JJ jointly; sim Heydon J. Appeal dismissed. 

(From the Case Notes of Thomas Hurley)

High Court Appeal
Commonwealth Social Security Act offences
Criminal liability for omission

In DPP (Cth) v Poniatowska [2011] HCA 43 (26 October 2011), the SA Court of Criminal Appeal had concluded the provisions of the Criminal Code (Cth) did not operate to attach the criminal liability to a failure of a person to do an act the person was not obliged by law to do. The High Court granted specal leave and reviewed the operation of the Code and concepts of criminal liability generally before dismissing the appeal: French CJ, Gummow, Kiefel, Bell JJ jointly; contra Heydon J. 

(From the Case Notes of Thomas Hurley) 


High Court Appeal Against Sentence
Bui v Director of Public Prosecutions (Cth)

Criminal law – Appeal – Appeal against sentence – Prosecution appeal – Double jeopardy – Appellant pleaded guilty to importation of a marketable quantity of a border controlled drug contrary to s 307.2(1) of Criminal Code (Cth) – Appellant sentenced to three years' imprisonment to be released forthwith upon giving security to comply with a condition that appellant be of good behaviour for three years – Respondent appealed against sentence – Sections 289(2) and 290(3) of Criminal Procedure Act 2009 (Vic) ("Victorian provisions") provided that double jeopardy not to be taken into account in allowing appeal against sentence or imposing sentence – Whether ss 68(1) or 79(1) of Judiciary Act 1903 (Cth) ("Judiciary Act") rendered Victorian provisions applicable to prosecution appeal against sentence instituted by respondent – Whether a "common law principle against double jeopardy" picked up by s 80 of Judiciary Act – Whether ss 16A(1)-(2) of Crimes Act 1914 (Cth) required or permitted court determining sentence for federal offence to take into account double jeopardy.

(From the Case Notes of Thomas Hurley)

Friday, February 10, 2012

Can You Terminate an Employee if They Have an Illness?

The general protections provisions of the Fair Work Act 2009 (“the Act”) aim to protect workplace rights and freedom of association and to provide protection from workplace discrimination. Under the general protections provisions of the Act, a person (such as an employer) must not take any adverse action against another person (such as an employee) because the other person has a workplace right, has exercised a workplace right, or proposes to exercise such a right.
An employer must not dismiss an employee because the employee is temporarily absent from work because of illness or injury. If a person believes they have been dismissed and alleges that their dismissal was in contravention of the general protections provisions of the Act, they can apply to Fair Work Australia (“FWA”) to deal with the dismissal. An employee may claim a breach of the general protections provisions if he or she is dismissed and can show that the dismissal was because he or she had taken temporary leave due to illness.
Temporary absence due to illness or injury
An employer must not dismiss an employee because they have been temporarily absent from work because of illness or injury if:
  • they have a doctor’s certificate;
  • they are on paid sick leave or they have had less than three months unpaid sick leave in the last year; and
  • general protections applications concerning dismissal must be made within 60 days of the dismissal taking effect.
Valid Reason for Termination?
A Contract of employment may be validly terminated on the basis of an employee’s illness when that illness has demonstrated an adverse impact on the employee to perform the inherent requirements of their job.
If the employee demonstrates they are able to perform the duties and responsibilities of their job, even after a period of absence from work, a termination of employment will not be valid and will be harsh and unreasonable (Cooper v Balfours Bakery Pty Ltd [2011] FWA 4595).
In Smith and others v Moore Paragon Australia Ltd the Federal Court stated, “the traditional view was that when an employee is so incapacitated by illness  or injury that he or she cannot work, at least in the longer term, the contract may be frustrated and thus terminated by operation of law and not at the initiative of the employer.”
In Marshall v. Harland & Wolff Ltd[1972] 1 WLR 899 , Donaldson J stated “the greater the degree of incapacity and the longer the period over which it has persisted and is likely to persist, the more likely it is that the relationship has been destroyed.”
Overall this area of law is complex and legal advice from an employment lawyer is recommended.

Tuesday, February 7, 2012

Recent Decisions: Family Law, Criminal Law and Civil/Commercial

Family Case Law Notes

Procedure - appearance by telephone - procedural fairness

In Patison & Farington-Manning and Anor [2011] FamCAFC 167 (15 August 2011) May J set aside a federal magistrate’s refusal to grant leave to a lawyer to appear by telephone. After discussing the purpose of an appearance by telephone and the differences between the Federal Magistrates Act and Family Law Rules governing it, May J said at paras 34-38:

“As can be seen a Federal Magistrate [FM] has a wide discretion to allow hearing by audio link, in this case via telephone. The [FM] was correct in doing so in the circumstances of this case. The [FM] was entitled to form the view that there were difficulties in hearing the matter by telephone and direct that in future solicitors attend in person. However, the problem was that the [FM] took the view that in some way the solicitor was behaving inappropriately based partly on an earlier hearing. Having listened to the audio transcription of both hearings and read each transcript it is apparent that for whatever reason the [FM] became exasperated and did not afford the solicitor procedural fairness. It is not immediately apparent what the solicitor did to cause this result.” 

(From the Editors of The Family Law Book)

Children - parenting order inconsistent with family violence order

In Brainard & Wahlen and Anor [2011] FamCA 610 (5 August 2011) Austin J heard parenting proceedings in a Magellan case where parenting orders would be inconsistent with the terms of family violence orders each party had obtained against the other. Austin J said at para 113:

“The literal terms of the family violence orders are untenable in the face of the proper parenting orders that this Court is enjoined to make. The orders made by the Court specify the inconsistency with the family violence orders and explain how those parenting orders will operate, as required by s68P(2)(a),(d) of the Act.

Austin J then proceeded to give the parties an explanation pursuant to the Court’s obligations under s68P(2)(c) and (d) of the Family Law Act as to the inconsisentcy, the necessity to make inconsistent parenting orders, the child’s best interests, the matters covered by parenting orders, which family violence orders were consistent and how contravention of both orders was to be dealt with.

(From the Editors of The Family Law Book)

Children - relocation to New Zealand allowed

In Harding & Crawley [2011] FamCA 581 (26 July 2011) the mother of a five-year-old child was allowed by Kent J to relocate to New Zealand from Queensland where the father had been spending alternate weekends with the child. The father had also had to issue Hague Convention proceedings to bring the mother back when she moved to New Zealand unilaterally.

(From the Editors of The Family Law Book)



Property - parties kept their finances separate - asset by asset approach

In Stiller & Power [2011] FMCAfam 996 (19 September 2011) the parties were married for 20 years but did not live together. Baumann FM found that the parties “kept their finances very separate”. At marriage, the wife owned property which by the hearing had grown to $4m whereas the husband’s wealth had “shrunk” to $315,000 due to losses caused by his mismanagement for which the wife (it was held) should bear no responsibility. Baumann FM took an asset by asset approach, finding that the husband’s “minimal” contributions [we]re almost irrelevant” and the wife’s contributions “also [were] almost irrelevant.” There was no adjustment for s75(2) factors as the comparative positions of the parties were found to have stemmed from the wife’s superior initial financial position and poor decision-making by the husband. 

(From the Editors of The Family Law Book)

Maintenance - bankrupt spouse may apply for variation of maintenance order

In Blake [2011] FMCAfam 796 (17 August 2011) the husband, who was declared bankrupt on his own petition six months after an interim maintenance order was made against him, was allowed to apply for the discharge of that order. Connolly FM held “that, despite bankruptcy, a bankrupt party has standing to bring an application under the [FLA] … that [is] personal in nature … which do[es] not affect the quantum of the bankrupt estate”. 

(From the Editors of The Family Law Book)

Property - Money from husband’s father held to be neither gift nor compellably repayable loan but a contribution on husband’s behalf.

In Maddock & Anor (No. 2) [2011] FMCAfam 1340 (13 December 2011) the husband’s father had given the parties $240,000 towards the cost of buying acreage and building a house on the land. After the parties’ separation the father intervened in the proceedings and sought repayment of what he argued had been a loan. The husband agreed but the wife denied any loan, alleging that the payment had been a gift. Burchardt FM at para 46 described the evidence as to this alleged loan as follows:

So far as the critical evidence as to the loan was concerned, the husband’s evidence was relatively ephemeral. He continued to depose that the advances were a loan and said that there were discussions between him and the wife as to how they would repay. He also said that he discussed with his father what would happen after the first mortgage was gone … He made it clear that he supported his father’s position … He admitted that he had himself incorporated into his own affidavit material the error in his father’s material as to the first payment advanced. ... Despite saying that [a loan] was discussed on a couple of occasions, he was not able to give any dates or places as to where the discussions had taken place.”

Burchardt FM found at para 62 that the intervener had given the parties the money because he “agreed to help them out”, adding at paras 63-68:

“Curiously, given the very large amounts of money involved, the arrangement for the advancement of the funds was attended by absolutely no formality whatsoever.

It is clear beyond doubt that:

a. There was no term as to the repayment of the loan. According to the intervener’s own evidence, the husband and wife could have repaid him when they paid out their mortgage in another 30 years’ time, when he would be at a very advanced age.

b. No demand for repayment was ever made until separation.

c. I should accept that if the money had been described as a loan repayable on demand, the wife would not have accepted it. Her evidence in this regard was compelling. The parties simply did not have the capacity to repay it. Although the intervener may not have known their exact financial circumstances, he knew that they were not able to readily borrow this from a bank (or they would not have been asking him) and it is clear that he must have known, or at the very least strongly suspected, that repayment was certainly a matter that would take place only, as he himself put it, as and when they were able to do so.

In one sense, the informal nature of these arrangements denies legal analysis. I do not think it was a gift. If someone gives you over a quarter of a million dollars, you tell the world about it. It is clear the wife never told her own parents in terms of this extraordinary bounty nor, it would appear, anyone else. Likewise, she never wrote a note of thanks, which an outright and clearly expressed gift would have been highly likely to have engendered.

To the contrary effect, however, I do not think that the arrangements can properly be described as a loan in the ordinary sense. Loans, if nothing else, have terms as to repayment. ‘Loan’ is defined by the Butterworth’s Australian Legal Dictionary as:

‘The temporary transfer of an asset, usually funds, from a lender who controls the funds to a borrower in return for payment, usually in the form of interest. The asset must be returned either in one sum at the maturity of the loan or in periodic payments.’

What I find to have occurred is that various advances were made by the intervener in circumstances which at the time appear to have been remarkably workaday [casual] … It seems to me far more probable than otherwise that the parties … did not have in mind the creation of legal relations in any technical sense.

The moneys were simply advanced and nothing was said as to when they would be repaid and in what way. It is quite clear that it was not contemplated that the moneys would be repaid upon sale of the property. As the husband rightly asserts, the parties had no intention of selling it. “

Before concluding that the payment should be treated as a contribution made on behalf of the husband Burchardt FM said at paras 72-73:

“In my view, the complete absence of a term for repayment or a mechanism for it to occur means that the ultimate characterisation of the advances is that they are not repayable. They were repayable at will.

I am absolutely clear in my mind that if the parties had not been separated, the intervener would never have asked for his funds. They would have been repaid as and when they were able to be repaid. The husband himself suggested that it would be repaid if they won Tattslotto. That was the true position. It is one that excludes the proposition that the $240,000 was compellably repayable.

(From the Editors of The Family Law Book)

Civil & Criminal Case Law Notes

High Court

Criminal Law - trial - directions to jury - assessing witnesses - assessments of “interest” of witness in result

In Hargraves v Q [2011] HCA 44 (26 October 2011) the High Court reiterated that the primary function of the trial judge was to ensure that the jury was focused on assessing the evidence to determine guilt beyond reasonable doubt. The appeal concerned comments by the trial judge, in the charge, that the jury should, in assessing the evidence of the accountant called by persons accused of defrauding the Commonwealth by entering a tax scheme, consider whether the accountant had an interest in the outcome of the trial. The High Court concluded that comments would not have deflected the jury from its task. Consideration of whether the decision in Robinson v Q [1991] 180 CLR 531 (1991) HCA 38 established a new doctrine or re-stated established principle. Appeal dismissed: French CJ, Gummow, Hayne, Crennan, Kiefel, Bell JJ jointly; sim Heydon J. Appeal dismissed. 


(From the Case Notes of Thomas Hurley)

Courts - precedent - status of Codelfa Construction Pty Ltd v State Rail Authority NSW

In Western Export Services Pty Ltd v Jireh International Pty Ltd [2011] HCA 45 (28 October 2011) in considering for an application for special leave the Court (Gummow, Heydon, Bell JJ) reiterated that the doctrine of precedent required intermediate courts apply the decision in Codelfa Construction Pty Ltd v State Rail Authority [1992] HCA 24 (1982) 149 CLR 337 as to the admissibility of surrounding circumstances until the High Court reviewed the decision. Special leave refused.

(From the Case Notes of Thomas Hurley)


Criminal law - liability - criminal liability for omission

In DPP (Cth) v Poniatowska (2011) HCA 43 (26 October 2011) the SA Court of Criminal Appeal had concluded the provisions of the Criminal Code (Cth) did not operate to attach criminal liability to a failure of a person to do an act the person was not obliged by law to do. The High Court granted special leave and reviewed the operation of the Code and concepts of criminal liability generally before dismissing the appeal: French CJ, Gummow, Kiefel, Bell JJ jointly; contra Heydon J. 

(From the Case Notes of Thomas Hurley)