Arbitration
UNCITRAL Rules – proportionate liability
In Tesseract International Pty Ltd v Pascale Construction Pty Ltd [2024] HCA 24 (7 August 2024) the High Court allowed an appeal from the Court of Appeal of the Supreme Court of South Australia.
The proceedings related to an arbitration concerning whether proportionate liability schemes apply to arbitrations.
“The proportionate liability laws, in substance, limit a defendant’s liability for the plaintiff’s loss according to the defendant’s responsibility for that loss. Proportionate liability, as provided for by the proportionate liability laws, represents a departure from the common law principle of ‘solidary liability‘, under which a defendant whose tortious conduct caused loss or damage to a plaintiff was liable to compensate the plaintiff for the whole of that loss or damage . . .” (Gordon and Gleeson JJ at [108]).
The arbitrator referred the parties to seek clarification under s27J of the Commercial Arbitration Act 2011 (SA) to determine a question of law, being whether the Law Reform (Contributory Negligence and Apportionment of Liability) Act 2001 (SA) applied to an arbitration being conducted pursuant to the Commercial Arbitration Act 2011 (SA).
Article 28 of the UNCITRAL Model Rules requires the arbitral tribunal to decide which law the parties have chosen to apply, which must be be construed unless otherwise expressly agreed as the law of the state of territory. Under Article 34(2)(b)(i) an arbitral award can be set aside under Article 34(2)(b)(ii) if the law is in conflict with the public policy of the state.
Gageler CJ stated: “Article 28 of the Model Law should not be construed to compel an arbitral tribunal to engage in the futile exercise of applying the substantive law to produce an award which . . . would be liable to be set aside by a supervising court under Art 34(2)(b)(i) or (ii) of the Model Law applying the law or public policy of the . . . place of the arbitration” (at [45]).
Jagot and Beech-Jones JJ stated: “. . . The only limits on the substantive law of South Australia . . . applying in the arbitration are those which result from party choice or from the conflict of laws rules and . . . from the arbitrability of the dispute and the public policy of South Australia” (at [290]).
Edelman J dissented stating: “The conclusion of the majority . . . does not necessarily apply to every arbitration agreement which provides for an arbitration to be governed by the substantive law of an Australian State. The interpretation of the arbitration agreement in this case might be relevant to, but cannot dictate, the interpretation of any other arbitration agreement . . .” (at [225]).
Criminal law
Sexual offences – child complainant – cross-examination of complainant – s293(3) of the Criminal Procedure Act 1986 (NSW)
In Cook (a pseudonym) v The King [2024] HCA 26 (7 August 2024) the High Court allowed an appeal in part.
The appellant was convicted of 17 charges: (i) sexual intercourse with a child under 10 years contrary to s66A(1) (count 1 and counts 6-11); (ii) indecent assault of a person under 16 years contrary to s61M(2) (counts 2-5); and (iii) sexual assault of a person under 16 years contrary to s61J(1) (counts 12-17).
The complainant had been the subject of sexual offences by the de facto partner of an aunt in 2008 and 2009 while living with them in Queensland. The de facto partner was charged and convicted but the matter went to the Court of Appeal, with the convictions overturned and the de facto partner ultimately pleading guilty to four counts of indecent treatment of a child under the age of 12.
The appellant sought to cross-examine the complainant on these offences.
In relation to evidence relating to sexual experience, pursuant to s293(3) of the Criminal Procedure Act 1986 (NSW) (Act) “(3) Evidence that discloses or implies – (a) that the complainant has or may have had sexual experience or a lack of sexual experience, or (b) has or may have taken part or not taken part in any sexual activity, is inadmissible”. The exception is found in s293(4).
The trial judge held that s293(3) applied but not any exceptions. Nevertheless, the trial judge allowed the appellant by way of expedience to cross-examine the complainant on what were euphemistically called “physical assaults”.
The appellant was convicted of all 17 charges and appealed to the Court of Criminal Appeal arguing that the judge had misled the jury by allowing the offending in Queensland to be referred to as physical assaults.
The appellant appealed to the High Court on the following grounds: Ground 1 that the Court of Appeal had erred in its construction of s293(4) of the Act; Ground 2 that some or all of the evidence was inadmissible and that the jury had been misled; and in the alternative, ground 3 that the Court of Appeal had erred in ordering a retrial.
The High Court held in majority that the exceptions under s293(4)(b) may apply on appeal on ground 1 and in part on ground 3.
The High Court in majority applied distinction between sexual experience and sexual activity, per Harrison J, in GEH v The Queen 2012 NSWCCA 150 as a characterisation that can persist separately from a particular sexual act (at [39]) in relation to the first limb of s293(4)(a) of the Act.
In relation to the second limb in s293(4)(a) of the Act, whether the evidence “is of events that are alleged to form part of a connected set of circumstances in which the alleged prescribed sexual offence was committed”, the majority held that “none of the Queensland evidence was, in this sense, ‘part‘ of a set of circumstances ‘in which’ the alleged sexual offences were committed” (at [46]).
Jagot J, in dissent, would have dismissed on all grounds: “I reject the submission for the accused that this case is an example of ‘categories of frequently excluded evidence that were not anticipated by the legislature’ . . . The Queensland evidence ruled to be inadmissible . . . under s293(3) was evidence proposed to be adduced from the complainant in cross‑examination . . . As the respondent submitted, this is ‘the very type of distressing cross‑examination which the legislature sought to preclude‘, because such questioning ‘has been a potent cause of reluctance [of victims] to report sexual assault’” (at [74]).
Arbitration
Setting aside an award – s34(2)(a)(iii) of the Commercial Arbitration Act 2012 (WA) – UNCITRAL Rules
In CBI Constructors Pty Ltd v Chevron Australia Pty Ltd [2024] HCA 28 (14 August 2024) the High Court dismissed an appeal from the Supreme Court of Western Australia. There were two issues on appeal – whether the Supreme Court can set aside an arbitral award under s34(2)(a)(iii) of the Commercial Arbitration Act 2012 (WA) and what is the test and standard to be applied.
The arbitral tribunal made an award deciding all issues of liability. The subsequent award was appealed to the Supreme Court of Western Australia on the basis that the arbitral tribunal was acting functus officio.
The majority held that the Supreme Court of Western Australia could set aside the subsequent award if they found de novo that the arbitral tribunal was acting functus officio.
The case concerned an oil and gas project operated by the respondent. The appellant provided staff for the operation and claimed that there were underpayments by the respondent. The respondent counter-claimed that they had been overcharged for the cost of staffing.
The respondent then successfully applied the Supreme Court of Western Australia to set aside the second arbitral award. The appellant appealed to the Supreme Court of Western Australia and ultimately the High Court of Australia.
The majority held: “The standard of review to be applied is a de novo review of the decision of the arbitral tribunal as to its jurisdiction” (per Gageler CJ, Gordon, Edelman, Steward and Gleeson JJ, at [43]).
Jagot and Beech-Jones JJ dissented and would have allowed the appeal. On the point of functus officio, their Honours stated: “. . . A conclusion that a body is functus officio must be justified, rather than asserted. Such a conclusion can only be ‘reached by close examination of the particular circumstances, and the nature of the power, function or duty in question‘. This is so regardless of whether a public or private power or duty is exercised or performed . . . The same applies to an arbitral tribunal operating under the Arbitration Act, which derives its jurisdiction from the consent of the parties but has its determinations given the force of law by statute and enforced by curial order” (at (72]).
