Industrial Court of New South Wales CITATION: Azar v Ritchie & Anor [2006] NSWIRComm 295 APPELLANT Nayla Azar PARTIES: FIRST RESPONDENT James Ritchie SECOND RESPONDENT J D Ritchie Pty Ltd FILE NUMBER(S): IRC 2639 of 2006 CORAM: Staff J CATCHWORDS: Courts and judges - Apprehended bias - Disqualification of judge - Familial association - Brother-in-law of judge partner in law firm acting for respondent - Sister previously worked in firm as solicitor - Whether apprehension of bias reasonable - Application for disqualification declined CASES CITED: Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 Smits v Roach [2006] HCA 36 HEARING DATES: 07/09/2006 DATE OF JUDGMENT: 09/14/2006 APPELLANT Nayla Azar In Person LEGAL REPRESENTATIVES: FIRST AND SECOND RESPONDENTS Solicitor: Mr T Unsworth TressCox JUDGMENT: - 1 - INDUSTRIAL COURT OF NEW SOUTH WALES CORAM: STAFF J 14 September 2006 Matter No IRC 2639 of 2006 NAYLA AZAR V JAMES RITCHIE AND ANOTHER Application by Nayla Azar for leave to appeal and appeal against a decision of Chief Industrial Magistrate Hart on 28 June 2006 in matter no. CIM 106663/06 JUDGMENT [2006] NSWIRComm 295 1 At the outset of these proceedings, I disclosed to the parties that I had a brother-in-law who was a partner in the firm of TressCox, solicitors for James D Ritchie Pty Ltd and Dr James Ritchie ("the respondents"). I also disclosed that my sister had worked for this firm as a solicitor. She is currently on maternity leave. 2 Ms Azar ("the appellant") who appeared in person, objected to me continuing to sit on the appeal. 3 The Full Bench adjourned the proceedings to enable me to consider the application by Ms Azar which I treated as being based on an apprehension of bias. 4 After considering two recent decisions of the High Court of Australia, which I will refer to in these reasons, I declined the application to disqualify myself from sitting as a Member of the Full Bench and hearing the appeal. 5 These are the reasons for my decision. 6 The principles that are required to be applied to an application such as this enables it to be disposed of shortly. 7 In Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337, the High Court considered the question of reasonable apprehension of bias and whether a judge should have disqualified himself. The background, as summarised in the headnote, was that at the commencement of a trial in the Federal Court of Australia, the judge disclosed to the parties that he was a director of the trustee of a family trust, which owned approximately 8,000 - 9,000 shares in a bank and that he was a "contingent beneficiary" of the trust. The bank was not a party to the proceedings, but had a pecuniary interest in the outcome. The respondent objected to the judge hearing the matter. The judge refused to disqualify himself, conducted the trial and gave judgment in favour of the applicant. 8 The court (Glesson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ, Kirby J dissenting) held that the judge should not have disqualified himself from delivering judgment in the matter. In a joint judgment (Gleeson CJ, McHugh, Gummow and Hayne JJ) stated at [6] - [8]: [6] Where, in the absence of any suggestion of actual bias, a question arises as to the independence or impartiality of a judge (or other judicial officer or juror), as here, the governing principle is that, subject to qualifications relating to waiver (which is not presently relevant) or necessity (which may be relevant to the second appeal), a judge is disqualified if a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge is required to decide. That principle gives effect to the requirement that justice should both be done and be seen to be done, a requirement which reflects the fundamental importance of the principle that the tribunal be independent and impartial. It is convenient to refer to it as the apprehension of bias principle. [7] The apprehension of bias principle may be thought to find its justification in the importance of the basic principle, that the tribunal be independent and impartial. So important is the principle that even the appearance of departure from it is prohibited lest the integrity of the judicial system be undermined. There are, however, some other aspects of the apprehension of bias principle which should be recognised. Deciding whether a judicial officer (or juror) might not bring an impartial mind to the resolution of a question that has not been determined requires no prediction about how the judge or juror will in fact approach the matter. The question is one of possibility (real and not remote), not probability. Similarly, if the matter has already been decided, the test is one which requires no conclusion about what factors actually influenced the outcome. No attempt need be made to inquire into the actual thought processes of the judge or juror. [8] The apprehension of bias principle admits of the possibility of human frailty. Its application is as diverse as human frailty. Its application requires two steps. First, it requires the identification of what it is said might lead a judge (or juror) to decide a case other than on its legal and factual merits. The second step is no less important. There must be an articulation of the logical connection between the matter and the feared deviation from the course of deciding the case on its merits. The bare assertion that a judge (or juror) has an "interest" in litigation, or an interest in a party to it, will be of no assistance until the nature of the interest, and the asserted connection with the possibility of departure from impartial decision making, is articulated. Only then can the reasonableness of the asserted apprehension of bias be assessed. 9 Relevantly, later, their Honours observed at [19] - [20]: [19] Judges have a duty to exercise their judicial functions when their jurisdiction is regularly invoked and they are assigned to cases in accordance with the practice which prevails in the court to which they belong. They do not select the cases they will hear, and they are not at liberty to decline to hear cases without good cause. Judges do not choose their cases; and litigants do not choose their judges. If one party to a case objects to a particular judge sitting, or continuing to sit, then that objection should not prevail unless it is based upon a substantial ground for contending that the judge is disqualified from hearing and deciding the case. [20] This is not to say that it is improper for a judge to decline to sit unless the judge has affirmatively concluded that he or she is disqualified. In a case of real doubt, it will often be prudent for a judge to decide not to sit in order to avoid the inconvenience that could result if an appellate court were to take a different view on the matter of disqualification. However, if the mere making of an insubstantial objection were sufficient to lead a judge to decline to hear or decide a case, the system would soon reach a stage where, for practical purposes, individual parties could influence the composition of the bench. That would be intolerable. 10 Their Honours went on to observe that the common law has developed along lines somewhat different from the development in England stating that: … In this country, an issue such as that which arose in Pinochet (No 2) would be resolved by asking whether a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge was required to decide. … 11 Their Honours observed that this is the test to be applied and reflects the general principle which is to be applied to problems of apprehended bias, whether arising from interest, conduct, association, extraneous information or some other circumstance. 12 More recently, the High Court again considered the question of apprehended bias in Smits v Roach [2006] HCA 36. In this case, the appellants, who were solicitors, were retained to act for the respondents in an action for damages for professional negligence against another firm of solicitors. The appellants and the respondents fell into dispute. The appellants ceased to act for the respondents, and subsequently sued the respondents seeking to recover professional costs. The disqualification issue arose at the end of the proceedings before McClellan J in the Supreme Court of New South Wales in unusual circumstances. McClellan J was concerned that the form in which he published his reasons for judgment might inadvertently and unnecessarily disclose information that had been the subject of a claim for confidentiality. Accordingly, he handed a draft of his reasons to the parties and invited them and the law firm Freehill Hollingdale & Page (who had initially acted for the respondents and who was the subject of a damages claim), to make comments on the form of the reasons to be published. 13 At a hearing attended by junior counsel for the respective parties to deal with the form of his reasons for judgment, McClellan J advised that his brother was the Chairman of Partners at Freehills and that he normally would not sit on a matter which involved Freehills interests, but that he did not appear to have any choice. Subsequently, counsel for the appellants filed a notice of motion for McClellan J to disqualify himself and to refrain from making orders in the matter. 14 McClellan J dismissed the motion, stating: The questions involved in the present dispute did not require the resolution of any issue relating to Freehills or any of its partners. Although the fact that Freehills have been sued has given rise to the current proceedings, the proceedings are otherwise so remote, that I am satisfied, having regard to the appropriate test, I should not disqualify myself. In any event as the plaintiff's senior counsel was apparently aware that my brother was a partner at Freehills but the matter was never raised, any right to object has been waived. 15 The Court of Appeal held that his Honour's decision in respect of waiver was correct. Similarly, Gleeson CJ, Heydon and Crennan JJ at [49], Kirby J at [137], Gummow and Hayne JJ agreeing in obiter at [61], found that the Court of Appeal's conclusion on waiver was correct. 16 However, against the possibility that the High Court might disagree with the Court of Appeal's conclusion on waiver, the respondents filed a notice of contention challenging the finding that a fair minded lay observer might have apprehended that McClellan J might not bring an impartial mind to the resolution of the case. In the Court of Appeal, Sheller JA, with whom Ipp and Bryson JJA agreed, had stated: … The question was whether the fact that the trial judge had no pecuniary interest whatever in Freehills but his brother did, might give rise to a reasonable apprehension of bias. In the circumstances that so far as was known the relationship was close, a fair minded lay observer might reasonably have apprehended that the judge might not bring an impartial mind to the resolution of the case. 17 Although the High Court observed that, strictly speaking, it was unnecessary to express a conclusion on the point, it stated (at [50]) that there were serious difficulties with the reasoning of the Court of Appeal. 18 Gleeson CJ, Heydon and Crennan JJ observed at [51]: [51] There is no suggestion that McClellan J had any personal interest, direct or indirect, in the case which he decided, or that he was in the position of being, either personally or through an alter ego, a party to the cause. The argument is based on association: a close family relationship with a person who, as a partner in Freehills, is said to have had a financial interest in the outcome of the litigation between Smits Leslie and the Roach interests. 19 After referring with approval to the joint reasons of four Members of the High Court in Ebner, particularly at [8] of that judgment, set out earlier in these reasons (at [4]), their Honours said at [54]: [54] The same observations apply where the basis of the assertion is association with somebody who is said to have an interest in the litigation. The reasons of the Court of Appeal do not articulate a logical connection between the matter complained of and the feared deviation from impartial decision making, or explain why it would have been reasonable to apprehend that McClellan J might decide the case other than on its legal and factual merits. The general principle to be applied is not in contest. In its application of the principle to the particular, and unusual, facts of the present case, the reasoning of the Court of Appeal is not compelling. If it were necessary to decide the notice of contention the argument for the respondents should succeed. 20 Gummow and Hayne JJ agreed with their Honours' observations at [58]. 21 The argument in this matter for disqualification was based on association: a brother-in-law who is a partner in the respondent's firm and a sister who previously worked for the firm. The brother-in-law is not the solicitor on the record and has not appeared in the proceedings. The questions involved in the present appeal do not involve any issue relating to TressCox or any of its partners. In my view, the proceedings are more remote than those considered in Smits v Roach and I am therefore satisfied that in accordance with the principles to be applied in determining such an application that I should not disqualify myself. 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