Shaw v Crichton and ANOR S101/1998 [1999] HCATrans 54 (12 March 1999)

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Sydney No S101 of 1998

B e t w e e n -

LEILA SHAW

Applicant

and

JOHN CRICHTON and NEIL CRICHTON

Respondents

Application for special leave to appeal

GLEESON CJ

GAUDRON J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 12 MARCH 1999, AT 2.35 PM

Copyright in the High Court of Australia

MR T. SHAW: Your Honours, I seek leave of the Court to appear on behalf of Leila Shaw, the applicant.

GLEESON CJ: Do you oppose that application, Mr Condon.

MR M.K. CONDON: I appear for the respondents, Your Honour. (instructed by Phillip Bushby International) I do not oppose my friend's application.

GLEESON CJ: You have the leave to represent the applicant, Mr Shaw.

MR SHAW: If your Honours would turn to page 20 of the application book there is a concise statement of the grounds of the appeal. I would just briefly, verbally, summarise why I believe this case merits the attention of the High Court. There are basically four pillars to it.

Three of these pillars are actually highlighted in capital letters in the grounds, the words "judicial accountability", "onus of proof principle" and "discretionary power of bankruptcy courts". The fourth has to do with natural law, and I will get to that.

GAUDRON J: What you are really saying is that, as a matter of its discretion, the Bankruptcy Court should blithely disregard an order of this Court with respect to costs.

MR SHAW: No, with respect, that is not - - -

GAUDRON J: It amounts to the same thing, does it not?

MR SHAW: I believe that it does not. I am saying that - we are submitting that a bankruptcy judge could exercise their discretion under section 52 to review a principle of law that was - - -

GAUDRON J: Ultimately, to review a costs order of this Court.

MR SHAW: Which flowed from something which we asked the Court to review. It is an effect, not a cause.

GAUDRON J: Which was not in issue in the proceedings when they came to this Court.

MR SHAW: Which was not in issue, the original costs order?

GAUDRON J: The onus of proof principle was not in issue - was not put in issue when the matter came to this Court.

MR SHAW: That is certainly not in dispute.

GAUDRON J: That gives you a very hard task, does it not?

MR SHAW: I do not believe so, your Honour. I do not see why it is at all relevant.

GAUDRON J: Because of the well-established principle that court orders are not subject to attack in collateral proceedings; more particularly, given the Courts hierarchy, orders of this Court are not subject to collateral attack in inferior courts.

MR SHAW: If, indeed, there is an error of legal principle in the onus of proof, then it would actually be blocking the operation of justice not to review it at any possible opportunity. I mean, if you carry this line of rationalisation to the logical conclusion, you could say, well, what is the point in objecting to slavery today - like, what is the point - why should there be any objection to slavery in the United States in the 1860s because nobody had ever objected to it before? If you think about it, it would - - -

GAUDRON J: Court proceedings are not political processes, Mr Shaw.

MR SHAW: But they do have political implications.

GAUDRON J: And court processes are conducted with the view that there must be a finality to litigation.

MR SHAW: Yes, I respect that, but I believe that as long as there is a discretionary power there, then one can appeal to it - I mean, either the discretionary power exists or it does not and one of the - - -

GAUDRON J: The question is not whether it exists or does not; the question is what matters are relevant to the exercise of the discretion and certainly what would be of overwhelming significance, not mere relevance, is, or was, that the point was not taken in the proceedings in which it could have been taken and, two, there must be a finality to litigation and, three, that the decisions of other courts are not to be attacked in collateral proceedings. To say there is a discretion does not mean that a court can do anything it pleases or even anything that, in the opinion of the judge, is just. A discretion has to be exercised by reference to relevant considerations and not by reference to irrelevant considerations.

MR SHAW: Actually not one of those points of consideration you mention actually tests the discretionary power of the Act or of the judge applying it, not one of them. A case is needed to test the scope of that discretionary power. I mean, surely I do not have to explain why.

GAUDRON J: I think you had better.

MR SHAW: There is nothing that you just said which actually tests the discretionary power, and that is precisely what we are attempting to do here, test that discretionary power. Does the Bankruptcy Court have the power to redress a problem from another jurisdiction? Does a trans-jurisdictional review exist within our judiciary? Can it? Should it? All of these questions need to be looked at. I mean, is the question of trans-departmental review, I have called it, within the judiciary - now, in this case it is between probate and bankruptcy, as you are well aware.

GAUDRON J: No, it is not, it is between the High Court, in the exercise of its jurisdiction as the final appellate Court in making an order as to costs in circumstances in which the ordinary rule is that costs follow the event and, if you like, the bankruptcy jurisdiction.

MR SHAW: I do not see how in any way that tests the scope of discretionary power in the Bankruptcy Court, in no way whatsoever. I mean, the general question is - because this matter has far reaching implications - if an embattled litigant finds himself in a jurisdiction from the one he started in, should he be able to depend on any court in the land, irrespective of jurisdiction, to address a possible error in legal principle or its application from another jurisdiction under which he may be suffering? Now, is that a reasonable question to look at or is it not? I submit that if that is not a matter of proper concern for the High Court, I could not imagine what would be.

Now, this whole litigation was founded on an alleged debt of about $10,000 quantum.

GAUDRON J: The debt was never in issue in the proceedings below. The existence of the debt was not challenged below. It was admitted, was it not?

MR SHAW: The debt was repudiated by the applicant from the beginning. Now, let us get that straight, please. There has been nonsense written, spoken of in the courts, to the effect that the debt was unchallenged. All you have to do is read the application papers for the hearing in the Court of Appeal to realise that that is an utter nonsense. The debt was repudiated from the beginning and, at the hearing, the court was asked to recognise the grounds on which it was repudiated. The applicant believed that a rational, direct and honest consideration of the grounds was totally sidestepped.

Now, even though the Court of Appeal had a better appreciation of the necessity to address this ground, it also essentially sidestepped the issue, leaving unanswered questions in its judgments which are being taken up in this special leave application. Now, before I get to the ground which we briefly touched upon, let me say that this double sidestep, so speak, is reason in and of itself for the High Court to assume responsibility in this matter. This is the meaning of the phrase on page 20, "hiatus of judicial accountability". That, in itself, unaccompanied by any other ground, would be sufficient reason for the High Court to address this matter.

It just so happens that the ground, the ground which was not addressed at the hearing or at the appeal, and the fact that that ground was just not addressed is sufficient reason for the High Court to be listening to us.

GAUDRON J: It is actually sufficient reason for us not to be on traditional legal principle.

MR SHAW: How do you figure that one?

GAUDRON J: Well, I am not here to give you a lecture in law, Mr Shaw, but simply on the basis that court orders are not subject to collateral attack and on the further basis that parties are bound by the way they conduct their cases. The case was conducted in the Probate Court on a particular basis and so be it.

MR SHAW: Your Honour, is your main concern - - -

GAUDRON J: I am not here to answer your questions.

MR SHAW: - - -to preserve the status of court orders or to ensure that there are no false legal principles operating within our system?

GAUDRON J: You are the one who is generating what I would have thought was the novel legal principle.

GLEESON CJ: One of our concerns is to ensure that there is an end to litigation.

MR SHAW: Yes. But you do not bring about that fairly by brushing aside such issues as the ones we bring before you. It has to have its proper day of attention. It really does. I respect the idea that court orders must be brought to finality but people's rights get trammelled upon in the process, they do, if you make the paramount concern not upsetting some costs order from a previous court. We want to look behind the costs order. We want to go to the cause of which the costs order is the effect. We are not taking any issue with the content of the original probate judgment. We are simply looking at a principle of law; an evidentiary rule, if you like, which is applied. But we believe its application is a very troubling thing, a very troubling thing.

You see, the onus of proof principle; the question is whether the onus of proving or disproving testamentary capacity should lie on the party who is granted a will and stands by it or on the party who seeks to block it. Had we not better get this onus of proof thing right, to bring some clarity to the making of wills in this country? I mean there is great confusion at the moment, not only amongst testators, possible will makers, but amongst possible beneficiaries of wills. Nobody knows where they stand. I mean if you make out a will in my favour and Joe Blow down the road does not like me, he can bring the action - you talk about streamlining the legal process, what is preventing Joe Blow from bringing an action to court, or.....one off and then raising every form of slander against me and then the onus is on me to prove that I should be the beneficiary of that will, that I am a good person, and I am struggling in a quagmire of character assassination in the process. That is what this evidentiary rule allows.

It is not enough, as Justice Einfeld said, well, this rule has not been looked at in 150 years so we are not going to do anything about it.

GLEESON CJ: He did not say the rule had not been looked at in 150 years; he said the rule has been unchanged for 150 years. That is not quite the same thing.

MR SHAW: Okay. It is not the same thing, but I tell you what, it could not have been looked at too closely at all because it flies in the face of natural rights. Now, there is a deplorably poor understanding of what rights are about, from what I can see within the judiciary, very poor understanding of what rights are about; very poor understanding of what natural law is about. But for the citizen, it is their only guide and recourse when they do not understand, or have no access to precedent, or where precedent is dubious. So there is an even more fundamental question lying at the back of all of this and that is whether the justice system in this country, or a justice system anywhere, for that matter, can ever be user friendly or citizen friendly unless there is a proper interfacing between institutional man-made law which is preserved by the professional judges and lawyer and what has been called natural law. And that is a law accessible to the intellects of citizens.

You notice that we do not quote or use any authorities, and I ask you not to attach any prejudice to that or not to look upon it with any prejudice, because our ultimate basis of authority is natural law and correct reasoning. That is all we need. And really, as lay citizens, that is all that it is appropriate for us to use.

Now, if you do grant special leave, we will be arguing in the High Court fourthly, and additionally, why it is possible to know through natural law that this is an erroneous legal principle and that any attempt to enforce the consequences of the application of that principle are morally and legally unjustifiable.

GLEESON CJ: Thank you.

This is an application for special leave to appeal against a decision of the Full Court of the Federal Court given on 9 July 1998 which in turn dismissed an appeal from Justice Branson of the Federal Court. The Court is of the view that there is no reason to doubt the correctness of the decision of the Full Court of the Federal Court and on that ground the application is dismissed.

Do you resist an order for costs, Mr Shaw?

MR SHAW: Yes, I do.

GLEESON CJ: On what ground?

MR SHAW: On the ground that your decision is unjust.

GLEESON CJ: Is there anything else you want to add to that?

MR SHAW: Natural law - - -

GLEESON CJ: If you want to add to it, stand up.

MR SHAW: Natural law exists, your Honour, whether you or I care to acknowledge it or not. We overlook it at our own peril. That is all I would care to add.

GLEESON CJ: Thank you. The applicant must pay the respondent's costs of the application.

Court will adjourn to reconstitute.

AT 2.54 PM THE MATTER WAS CONCLUDED