Ulman & Ors v Live Group Pty Ltd & Anor [2019] HCATrans 109 (17 May 2019)

Last Updated: 22 May 2019

[2019] HCATrans 109

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Sydney No S21 of 2019

B e t w e e n -

RABBI YEHORAM ULMAN

First Applicant

RABBI MOSHE GUTNICK

Second Applicant

RABBI MICHAEL CHRIQUI

Third Applicant

RABBI ELI SCHLANGER

Fourth Applicant

and

LIVE GROUP PTY LTD ACN 145320403

First Respondent

REUVEN BARUKH

Second Respondent

Application for special leave to appeal
BELL J
GAGELER J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 17 MAY 2019, AT 12.10 PM

Copyright in the High Court of Australia

____________________

MR I.M. NEIL, SC: If the Court pleases, I appear with my learned friend, MR P.C. MOORHOUSE, for the applicants. (instructed by Schweizer Kobras)

MR J.T. GLEESON, SC: May it please the Court, I appear with MR S.A.S. WELLS and MR J.R. ANDERSON, for the respondents. (instructed by Lazarus Legal)

BELL J: Yes, Mr Neil.

MR NEIL: If it please the Court, we have propounded four special leave questions at page 217 of the application book but for today’s purposes we had wished, if the Court please, to focus on two of them, questions [3] and [1], in that order.

BELL J: Yes.

MR NEIL: Question [3] involves, or embodies, these questions, in our submission: what is the test for a contemptuous interference with the administration of justice as a continuing process, or generally, as it is sometimes put? More particularly, can conduct properly be held to have interfered with the administration of justice generally when that conduct has no connection with any pending, contemplated or likely proceedings and where any right of access to the civil courts that might be in question is entirely abstract?

Now, it is said against us that this question and the questions embodied in special leave question [3] all turn on an issue of construction, the proper construction of the conduct of the rabbis. However, our submission is that that issue of construction is not determinative of the questions of principle raised by special leave question [3].

Your Honours will recall that the conduct in question concerned the sending of two pieces of correspondence: one, which is the subject of charge 2, dated 29 December 2016 – your Honours will see that in the application book at page 148 in paragraph 31. The second, the subject of charge 6, was dated 28 February 2017 and the terms of that are relevantly set out in paragraph 37 on page 150.

May we remind your Honours how the Court of Appeal divided on the construction of these two letters? First, Justice McColl in dissent, page 205 of the application book, paragraph 262.

GAGELER J: The word is “exhortation”; we are to read them as “exhortations”.

MR NEIL: Yes, your Honour, we would accept that. The second passage in which her Honour deals with this issue is on page 208 in paragraph 276. So far as the majority is concerned, their Honours’ construction of the conduct is on page 181 of the application book, paragraph 159 and, in particular, the first and the last sentences. Now, if special leave were granted we would propose to argue that Justice McColl’s construction of the rabbis’ conduct was correct, essentially for the reasons that her Honour gives relating

BELL J: Why is that not, as the respondent submits, simply a question of the construction placed on the two items of correspondence?

MR NEIL: We accept that, your Honour, but may we move to the next point which is to say that, noting as we pass from it, that if her Honour is correct, as a matter of construction, then it would follow, in our submission, that there had been no contempt. But moving then – turning then to the construction adopted by the majority

BELL J: What is the point of principle based on the majority’s conclusion respecting the correct construction of the emails?

MR NEIL: The starting point of our answer to your Honour’s question is the proposition that conduct can only constitute a contemptuous interference with the administration of justice generally if, as a matter of practical reality, it has a real or a clear and a definite tendency to interfere with the course of justice. The conduct in question must be likely to have the effect of interfering with the course of justice.

Now, against the background of that principle, we point to four features of this matter: one, the conduct that was found to constitute a contempt on either construction consisted of applying pressure specifically to Mr Barukh and specifically and exclusively in relation to the alleged commercial dispute between his company and that of Mr Kuzecki; two, the unchallenged finding was that there was no and there was never any realistic possibility that Mr Barukh would commence proceedings in respect of that dispute - for example, page 166, paragraph 91. The respondents for their part accept that they were only ever natural defendants to use their expression – never possibly plaintiffs.

Three, the Court of Appeal did not find that any of the rabbis’ conduct actually interfered with the administration of justice generally. Four, the Court of Appeal did not make any finding that identified any mechanism by which the rabbis’ conduct on any construction, including that of the majority, could have had a tendency to interfere with the administration of justice.

We accept, as we must, the finding that the rabbis’ conduct applied pressure to Mr Barukh; but that pressure was unrelated to any civil proceeding that was pending, imminent or was even a realistic possibility. On the majority’s construction of the rabbis’ conduct, that conduct was a response only to Mr Barukh’s entirely abstract assertion that the dispute in question should be resolved in a civil court. That degree of abstraction is the antithesis of the practical reality on which the law has always insisted. That is the point of principle. It is on that ground that we submit that this aspect of the Court of Appeal’s judgment, if it stands, will effect a substantial and unwarranted expansion of the law of contempt.

BELL J: A finding that the applicants’ conduct tended to interfere with Mr Barukh’s right to have a civil court determine the commercial dispute you say as I understand it, you do not cavil with that but you say it does not amount to the sort of practical tendency with which the law of contempt in the sense of a general contempt interfering with the administration of justice requires. Is that the point?

MR NEIL: That is correct, your Honour. It relates to this type of contempt and we focus on the requirement for it to be the conduct in question to be assessed as a matter of practical reality, and for that conduct to have a relationship with the effect of interfering with the administration of justice in a way which is real, clear, definite, likely, to use the language of the authorities.

We could put it in this way, your Honour, perhaps. It might be accepted we accept for the purpose of the argument – that sanctions that would improperly pressure a person not to approach the courts if they wished to make a claim should be prohibited by the law of contempt, and perhaps that would be so even if the wish were related only to something that they might be likely to want to do. We would accept that.

That is not this case, in our submission. What the majority found in paragraph 159, as your Honours will see, is not that. The majority found that the sanctions were threatened because Mr Barukh asserted that if Mr Kuzecki or his company wanted to make a claim against him then that claim should be resolved in a civil court. To prohibit that conduct, in our submission, is to take the law of contempt too far, especially when, as we have emphasised, there was never, on the evidence and on the findings, any possibility that civil proceedings would ever be instituted or prosecuted.

To emphasise that point we draw attention to the fact that this case, again on any construction, falls outside any of the established categories of interference with the administration of justice generally, and as your Honours will recall, those established categories involve concepts such as scandalising the courts, interfering with witnesses after a trial, interference with jurors or potential jurors and interference with officers of the court. This case is not like any of those because of the degree of abstraction that is involved.

BELL J: Do you cavil with the finding that at 159

MR NEIL: At 159, your Honour?

BELL J: Yes, this is paragraph 159. I am sorry, it is on application book 181.

MR NEIL: Yes, your Honour.

BELL J: Their Honours construed the email as a demand that Mr Barukh not persist in his claim that the dispute between him and Mr Kuzecki ought properly to be brought in a civil court?

MR NEIL: Yes, we do but we also say even if that finding were to stand, the point of principle arises.

BELL J: So that interference – pressure brought to a person to prevent them insisting on their right to have a matter – a civil dispute resolved by the courts of the State, you say that is outside the realm of what you describe as general contempt?

MR NEIL: Yes, although the with respect the level at which your Honour has put that proposition would require some qualification in order to relate it to the facts of this case.

GAGELER J: As I understand it, you accept in your own formulation of the high level principle the language of Justice Ipp that is quoted in paragraph 75 of the majority’s reasons and you say, on the facts as found by the majority, that test is incapable of being fulfilled. Is that right?

MR NEIL: We do. Correct. Your Honour will recall that the test that his Honour Justice Ipp formulated finds expression in various places – Lane, as explained in Collins and so on. We accept that and the way in which we put it is as your Honour has formulated, yes. To say incapable in a way that – I withdraw that – and then we go on to say that if the judgment of the Court of Appeal were to stand then it would take that principle farther than it can possibly go.

GAGELER J: Yes.

MR NEIL: Now, we should deal with one other issue and that is to say we have as your Honours have heard – emphasise what we have called the degree of abstraction here. We acknowledge the respondents take issue with that characterisation of Mr Barukh’s position, that is, our characterisation that Mr Barukh’s position was the assertion of an entirely abstract right to have a civil court deal with the dispute between the two companies. They deal with that in paragraph 36 of their response on pages 234 and 235.

We say in answer to that that none of the considerations to which the respondents there point make any difference. It may be accepted that the Supreme Court had jurisdiction to deal with the commercial dispute but the critical fact here is that the invocation of that jurisdiction was never a practical reality and that is the answer we make to that proposition.

BELL J: Yes.

MR NEIL: Before we leave the territory of special leave question [3] may we say something particular about the correspondence that was the subject of charge 6?

BELL J: Yes.

MR NEIL: Your Honours will recall that the effect of that correspondence was to give notice in accordance with an undertaking that had been given to the court that sanctions would be imposed within a period of time that it had earlier been agreed between the parties would be sufficient to allow the respondents to move the court for relief and that was all done in the context of a regime in which the applicants said they would cooperate with an early hearing and disposition of that matter.

In addition to all the arguments that we have propounded in relation to special leave question [3] there is another set of arguments that relate particularly to this piece of correspondence and that has really captured what we wish to say about that is captured in two paragraphs of Justice McColl’s judgment, both on page 209, and they are first paragraph 279 and then paragraph 280, particularly the last sentence of that paragraph. That is a particular point that relates to charge 6.

BELL J: Where do we find in the reasons of the majority a discussion of that issue, namely, the compliance with the undertaking?

MR NEIL: Page 184, particularly in paragraphs 176, 177 and 178.

BELL J: It really brings you back to your primary point, does it not, because the majority observed that whilst the applicants were willing to facilitate the process initiated by Mr Barukh they were not resiling from their basic stance, namely, they had sole jurisdiction and would impose sanctions on Mr Barukh were he not to comply.

MR NEIL: Were he not to comply with the summons, yes. But contempt is not a thought crime. The conduct, in our submission, falls to be construed in its entirety and that was what Justice McColl did, we submit, with respect, correctly. Charge 6 cannot be understood – sensibly be understood, in our respectful submission, as being anything other than conduct that was directed to ripening for disposition the very issue in question and for disposition by this Court – I am sorry, by the Supreme Court.

BELL J: Yes.

MR NEIL: That is really what Justice McColl had in mind by the last sentence in paragraph 280.

BELL J: I see. Thank you.

MR NEIL: Just noting the time may I move very quickly to special leave question [1]. We accept that success on that question for us would also involve consideration of special leave question [2] and we might come to the latter question shortly. Staying with question [1] for the moment, we start with an acknowledgment that the primary judge in the Court of Appeal correctly recognised that the issues in these proceedings involve a balance between the right to unimpeded access to the civil courts on the one hand and the freedom to act in accordance with conscience in matters of religion on the other hand.

As the majority observed, identifying that point of balance is not necessarily straightforward, as Justice McColl said. It is often a delicate question. On any view, in our submission, the determination of the point of balance has a vital social importance in a pluralistic society. The rabbis’ contention is that in this case the majority gave too much weight to the right of access to the court and not enough weight to the freedom of the applicants, the rabbis, to act in accordance with their conception of their religious conscience and equally and perhaps even more importantly with the freedom of every Orthodox Jew to have what they believe is God’s will for them and their community applied and enforced in accordance with its tenets.

The rabbis’ contention is that the Court of Appeal should have found – the majority should have found, as Justice McColl did in dissent, that the rabbis were entitled to express the view that a person who disagreed with the relevant tenets of Halacha was no longer an adherent to the Jewish religion. That finding on the part of her Honour is on page 209 in paragraph 283.

Now, very quickly, if we may, in relation to special leave question [2], the majority held that the rabbis had not established that they had Halachic authority over matters involving corporations and for that reason had not proven that Mr Barukh in fact had a religious obligation to comply with their summons. That finding is in three places: paragraph 167 on pages 182 and 183, paragraph 175 on page 184 and the first sentence of paragraph 184 on page 186. Justice McColl dissented on this point

BELL J: Can I just take up with you this?

MR NEIL: Yes, your Honour.

BELL J: At 184, as I understand the point that their Honours are making, is this was not a case where the pressure was not improper because there was a shared belief.

MR NEIL: Yes, we would accept that that last reference that we have given is a related but slightly different point.

BELL J: Yes.

MR NEIL: May we say something about that in a moment? We will not forget to do so.

BELL J: Yes.

MR NEIL: What we had wished to do, and we

BELL J: The light is on, Mr Neil.

MR NEIL: It is, your Honour. May we just say as we conclude that the point of principle here is that which is articulated in the last sentence of paragraph 271 in Justice McColl’s dissent.

BELL J: Thank you.

MR NEIL: If it please your Honours.

BELL J: Thank you. Yes, Mr Gleeson.

MR GLEESON: If your Honours go to the four questions on page 217 of the book, can I deal with them in reverse order which is what has effectively happened this morning? Question [4] is a question of construction only and you have been taken this morning to the majority’s reasons at paragraphs 159 in respect to the first letter and 177 in respect to the second and we submit there is no error in those.

Coming back to question [3], there is nothing abstract about what occurred here and there is no distinction for contempt between you being a plaintiff and a defendant. What happened here was the rabbis said, we issue you a summons, if you do not turn up we will excommunicate you – to put it loosely – on the first return date before us you will sign an arbitration agreement intending to invoke the civil law, if you stay away from our process you will be sanctioned, you will then have determined before us under our system of law a commercial dispute and, lo and behold, the matter will – if the matter ever comes before a civil court it will be on enforcement of an arbitral award not under civil law and that is the end of the day.

That is why the majority said this was an assertion of sole jurisdiction. It does not matter there whether you are plaintiff or defendant, the point is your ordinary right to have the civil court decide the matter under civil law has been effectively shut down by the demand of the rabbis and for that reason your Honours would not regard, we submit, there being anything in this being too abstract. That is the third ground.

The second and the first are in fact intertwined and they are governed by the finding of fact that your Honour Justice Bell referred to at paragraph 184 and the majority has persuasively shown that on the evidence there simply was not the necessary finding of fact to even attract the shared belief type possible exception to contempt. So, for those reasons, we submit the Court should refuse leave.

BELL J: Yes, thank you. Yes, Mr Neil.

MR NEIL: Very shortly. The proposition of exclusivity to which our learned friends point, two answers: first, that is not what the majority found in paragraph 159 was the conduct or the contempt in question; second, even if one were to accept the availability of the submission it all hinges on the arbitration agreement and the answer to that is found in the reasons of Justice McColl at paragraph 286 on page 210. If it please the Court.

BELL J: Thank you.

In our opinion, there are insufficient prospects that were special leave to appeal granted any appeal would succeed. The application is dismissed with costs.

MR NEIL: May it please the Court.

AT 12.36 PM THE MATTER WAS CONCLUDED