Bills

Magistrates Court (Monetary Limits) Amendment Bill

Second Reading

Adjourned debate on second reading.

(Continued from 13 April 2016.)

Ms CHAPMAN (Bragg—Deputy Leader of the Opposition) (17:11): I rise to speak on the Magistrates Court (Monetary Limits) Amendment Bill 2016 and indicate that the opposition will be supporting the bill. There is a deficiency, and I will address that, but essentially this is a bill to reduce the maximum monetary limit for minor civil matters in the Magistrates Court from $25,000 to $12,000. As is well known, our leader introduced a bill in 2011 to increase the monetary limit from $6,000 to $25,000, to be consistent with what occurred in Queensland. Quite reasonably, he brought that proposal to the parliament as, firstly, there had been no increase in the threshold on this type of matter since 1991, which of course was 20 years before.

Secondly, he raised the access to justice issue; that is, people who would have the imposition on them of having to meet legal costs in taking a matter to court, or potentially meet the legal costs of the other party, particularly if they were unsuccessful, but in some jurisdictions, where there were no costs to follow the cause, subject to such a financial burden that might prejudice them having access and seeking relief in the court. Thirdly, Judge Peggy Hora, who was a Thinker in Residence, had come to Australia and provided a report for us to consider in which she strongly recommended, as an access to justice issue, that we make sure that we have a court for the people.

I openly admit that I am a member of the Law Society, a legal practitioner and a member of the Bar Association. So, I think there is a very strong case in many situations for people to employ a solicitor, to get good advice in the first place, and then that they would be well represented in any litigation to have an advocate employed for that purpose. It is simply a situation where—I do not purport to be an expert in selling property, so I would not go out and try to sell a piece of property myself. I would employ a licensed land agent, because they are the experts in the job to do it. I certainly do not fill out my own tax return; I get a qualified accountant to do it, because people have areas of expertise.

Sometimes a matter which is, for example, the recovery of money claimed to be due to somebody as a result of an unpaid wage, or a payment pursuant to a contract, can be quite a simple recovery: an application made, determined by the magistrate and a judgement issued, then the enforcement proceedings can progress and somebody can get quick and easy access and relief.

On the other hand, that simple application could become very complicated if it were for a job to be done for which there was a cross-application that the work that was done was of poor standard. For example, with a building extension on someone's home or some other modification the owner of the property may, in those circumstances, say, 'Look, this is a shoddy job. The work was done but it was done to a very poor standard and I am now left with damage and costs expended.' There is a cross-claim, and it becomes a bit complicated.

In other situations, such as in defamation cases, where the claim is for damages for offensive material published in a defamatory way, somebody who has a legitimate tortious claim for damages may, when coming to the Magistrates Court—even if they are seeking monetary relief of only a small amount, or certainly achieve a settlement of only a small amount—find themselves buried in a very complex case. For obvious reasons they probably would have been well served in getting some good legal advice in the first place and proceeding with a negotiated settlement.

I am certainly not someone who is going to stand here as a legal practitioner and say that it was an inappropriate consideration in the first instance. However, I would suggest that it was reasonable at the time that when the parliament dealt with the monetary limits that were to apply and settled on the $25,000—which was a significant increase under their own bill, it was under their court efficiency reforms—that the decision to conduct a review, which is placed in the legislation, was a sensible one.

Since then, and bearing in mind that the legislation came into effect 1 July 2013, in early 2015 the Attorney-General instructed the Office of Crime Statistics (commonly known as OCSAR) to conduct the review of how effective this change had been. They considered the data from the financial year July 2013 to end of June 2014—obviously the preceding completed financial year—and provided a report to the parliament late last year. I am disappointed to note that even though another full financial year had actually been completed, they did not consider that same data in that financial year. If they had done that, we might have actually had a very different position, as per the recommendations that came out of that review.

I just bring that to the attention of the house because if we look at the recommendations—which, as I say, relied only on the data from mid-2013 to mid-2014—they say they had a finding in the report that there was an increase in the number and complexity of small claim lodgements in the 2013-14 year, that is up 7.9 per cent to 21,547 in that year. If they considered the next financial year they may have come up with a different piece of information because, in fact, in the next financial year the lodgements in the civil lodgements claim decreased by 9.3 per cent from the previous year.

Interestingly, the annual report of the Courts Administration Authority for the financial year ending 30 June 2014-15, which is prepared by the Courts Administration Authority (and the head of that, of course, is the Chief Justice, Mr Kourakis), notes on page 14, and I quote:

Due to the increase in jurisdiction in 2013, there was a spike in personal injury matters being lodged in the Magistrates Court. These matters take longer to finalise explaining the large increase in lodgements in the 2013-14 financial year offset by a large decrease in the 2014-15 reporting period.

I would ask the Attorney that, if he is going to get OCSAR or anyone else to look at the data, look at all the available data and understand that, quite reasonably, there was an increase in 2013. It is there in the annual reports to tell us why. I can tell you that if in April 2013 I was aware that there was about to be an increase in a threshold and that I would not have to employ a lawyer and I thought that was a good thing and I had a claim, I would wait until after 1 July to lodge my claim. That is human nature, and it is consistent with the fact that the second finding of the report was:

…some indication of an increase in accessibility to the civil justice system (increase in the actual number of small claims between $6,000 and $25,000).

Again, look at the whole of the data. Does that mean that in fact it worked, that it was a good thing to do, that we have provided access to justice to a whole lot of people who otherwise would have been intimidated against prosecuting their case and their claim because of the prospective cost of lawyers and the like? Who knows, but they should have looked at the 2014 data. The third finding was:

…a possible reduction in the medium number of days to finalise a defendant claim between $6,000 and $25,000…recommended that a further 12 months of data to be considered.

That factor clearly was not a finding that the reviewer thought needed to be relied on and that they should be looking at a further 12 months. Again, I do not know why they did not. They should have and they could have and the data was available, but they did not do it. The fourth thing they found was:

…an increase in the number of days from lodgements to finalisation of small claims since the commencement of the above act.

And then they quoted the data for the financial years 2013-14, 2012-13 and 2011-12. Again, the information in respect of the reasons for that is spelt out in the Courts Administration Authority Annual Report, and there is no indication that there had been a conferring with that authority together with OCSAR. obviously one is the statistical body that operates in the Attorney-General's Department, and they are strictly a separate agency but, clearly, they work closely together so it is a little concerning.

What the report does confirm—and we have been provided with a copy of that report to the parliament; it was tabled in December last year—and they say, 'This is what we recommend you do.' One is:

Consideration be given to excluding certain types of claims where there would be the benefit of legal representation in court regardless of that amount.

And they said that could be included but not limited to defamation cases. So, again, complex cases—cross-claims in building disputes and defamation cases. These are logical situations where the law gets very complicated—reasonable. The second is:

Consideration be given to reducing the upper monetary limit from $25,000 to an amount between $12,000 and $15,000.

They then say that if, on the other hand the parliament elects to keep the upper limit at $25,000, consideration be given to the magistrates for unfettered discretion to direct that a monetary claim for more than $12,000 but less than $25,000 not be treated as a minor civil action; and, secondly, that consideration be given to provision of greater access to simple and limited legal advice for parties to minor civil matters.

The government have clearly not gone down that line. That was an alternate recommendation of the report to us. The government have come in and said, 'We won't go down that line. We have elected to simply bring the monetary limit back down to $12,000.' They certainly had an opportunity, consistent with that report, to provide a greater discretion.

It should be noted that the current law provides for the magistrate who is hearing the matter to have a discretion not to exclude lawyers or, in the reverse, a discretion to permit lawyers to be part of the process, but it is to be in I think the words are 'exceptional circumstances' or something of that nature. Clearly, as I say, there was an option to go back to the reforms to give greater discretion to the magistrates. The government have dismissed that option and come to us with this one.

Another thing I would like to mention is that the government, via the Attorney-General's correspondence, provided some material at our request, subsequent to a briefing provided by Ms Alexandra Wright, who is a solicitor in the chief executive's office, and, of course, the indomitable Mr Will Evans, who is from the minister's office, and I appreciate receiving that. One piece of material I asked for was on the area of disputes, where there was complexity. Apart from the consideration given by the Joint Rules Advisory Committee, which only identified defamation, I have not been provided with any other areas of complexity.

The second request was to have a copy of the Joint Rules Advisory Committee report and also confirmation as to how much more legal aid was going to be paid for by the government to facilitate the extra requirement that might be needed for people to actually get advice. I got a letter back from the Attorney-General, and I thank him for that.

They did provide a copy of the Joint Rules Advisory Committee report. It was a report prepared by the Honourable Justice Blue, who chairs that committee. It is fair to say that, whilst there are obviously Supreme Court and District Court representatives on that committee who are in charge of setting rules and recommendations on regulations in respect of the operation of the superior courts, there is a representative from the Magistrates Court on that committee, so I am assuming that person ensured that the balance were well informed.

Justice Blue makes the astute observation in this report to the OCSAR evaluation manager who was conducting the review, in a letter dated 10 April 2015, firstly, that defamation cases were an example of complex cases. He pointed out that frequently the defamation cases involved very low amounts in what was ultimately settled upon and, again, they were trapped within this limit. Secondly, he made comment that the time devoted by magistrates to hearing small claims involving more than $12,000, I suppose, in short, made it pretty difficult for the management of the court.

I read that as some concern that people in the judiciary or the courts themselves within this Magistrates Court jurisdiction are not too keen on having people turn up to the court, lodge forms, need corrections, get advice, have a million questions, and then have to, painstakingly sometimes, go through the process of explaining things in person to a person who is a litigant without the benefit of a legal representative.

It all does get a bit tiresome at times, and I fully accept that, but remember that they are a paid judicial officer. There are people in the courts who are paid to make sure that they have a system that provides people with access to justice and a determination of the dispute or claim to which they are seeking some remedy. The inconvenience or general irritation to people who are in the courts process would not, in and of itself, persuade me that we need to streamline this bill to bring lawyers back into the process.

I will say—and again, I disclose that I am a legal practitioner—that I think there are many situations where, if there had been legal advice or someone representing them, it would have cut down the time in court and would have cut down the delays, and there would have been a more prompt determination of the matter. There has been no actual data collected on that other than an anecdotal response to a survey. Of course, they surveyed lawyers, so the answer on that was hardly surprising.

If I were answering the survey as a practitioner, I would tick the box and say, 'Of course we can help. We are representatives and officers of the court, and we are here to help for a fee.' So, I did not really find that terribly instructive. If one is really examining accessibility to courts then frankly, on the face of the limited data that was examined, it actually demonstrates that this initiative of moving to 25,000 has worked. So, there is very little data.

We have a recommendation from the Joint Rules Advisory Committee to consider reducing the upper limit to 12,000. He also said, in the alternative, to give the magistrates unfettered discretion. Again, that option has been completely ignored by the Attorney-General in progressing this bill, and he does not explain why he has not considered that option. We need to do something on the basis of the information before us. I think the decision of the government to introduce a reform only considering this option, without looking at the further data, is a bit lazy and a bit negligent on his part. Nevertheless, it is one of the options that has been considered and has come through the recommendation process, so we are not going to object to it.

I make the point that the next time we do a review on these things, I would ask the party requested to provide that review to look at all the data and give us a full report and, in short, to do it properly. I thank the Honourable Justice Blue and his committee for considering the matter and providing advice, and otherwise the advisers on the bill. To the Attorney-General, I just say: do it a bit better next time.

The Hon. J.R. RAU (Enfield—Deputy Premier, Attorney-General, Minister for Justice Reform, Minister for Planning, Minister for Industrial Relations, Minister for Child Protection Reform, Minister for the Public Sector, Minister for Consumer and Business Services, Minister for the City of Adelaide) (17:33): I thank the honourable member for her contribution. In view of the fact that I understand the deputy leader and her colleagues will be supporting this, I thank them for that.

Bill read a second time.

Third Reading

The Hon. J.R. RAU (Enfield—Deputy Premier, Attorney-General, Minister for Justice Reform, Minister for Planning, Minister for Industrial Relations, Minister for Child Protection Reform, Minister for the Public Sector, Minister for Consumer and Business Services, Minister for the City of Adelaide) (17:34): I move:

That this bill be now read a third time.

Bill read a third time and passed.