FEDERAL COURT OF AUSTRALIA

Singh v Secretary, Dept of Family & Community Services [2001] FCA 1281

PRACTICE & PROCEDURE – application to revoke consent orders – where orders not formally entered – where orders dismissed proceedings with no order as to costs – where applicant wished to revoke consent because of a change of heart – whether applicant entitled to revoke orders.

Social Security Act 1991 (Cth)

Federal Court of Australia Regulations 1978, O 35 r 10

Harvey v Phillips (1956) 95 CLR 235 followed

Paino v Hofbauer (1988) 13 NSWLR 193 followed

MOHINDER SINGH v SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES

NO. V 130 OF 2001

BEAUMONT, KIEFEL & HELY JJ

21 SEPTEMBER 2001

SYDNEY (HEARD IN MELBOURNE)

ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA

THE COURT ORDERS THAT:

1.                  The appeal be dismissed.

2.                  Costs be reserved.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA

REASONS FOR JUDGMENT

THE COURT:

INTRODUCTION

1                     This is an appeal against a decision of a Judge of the Court, refusing an application by the appellant to revoke orders made by consent and filed in the Court on 19 December 2000.  Those consent orders sought that proceedings brought by the appellant in the Federal Court appealing against a decision of the Administrative Appeals Tribunal (“the Tribunal”) be dismissed and that there be no order as to costs.

2                     The appellant appeared before the Court at first instance, and before us, without the aid of legal representation and was assisted during the appeal by his daughter and a court-appointed interpreter.  He seeks orders that the minutes of consent orders be set aside and that his appeal from the Tribunal be reinstated.

BACKGROUND

3                     The primary Judge described the relevant background as follows:

·                     Mr Singh has long been involved in a dispute with the Department of Family and Community Services relating to entitlements under the Social Security Act 1991 (Cth).  The dispute concerns a decision made in 1999 by an officer of Centrelink (Centrelink being the Commonwealth agency whose employees have been delegated the Secretary’s powers under the Social Security Act) to cancel social security payments that were being made to Mr Singh and a related decision by Centrelink to recover approximately $44,000 from Mr Singh’s wife.

·                     Following various proceedings initiated by Mr Singh to have Centrelink’s decisions reviewed, the matter ultimately came before the Tribunal.  Mr Singh was unsuccessful in those proceedings and filed an application, “styled Notice of Appeal”, in the Federal Court to have the decision of the Tribunal set aside.  The question of law identified as arising on the appeal was the alleged “misuse” of the powers conferred by the Social Security Act.  In addition, Mr Singh claimed that the relevant decision was “wrong”.

·                     On 15 December 2000, a directions hearing was held before the primary Judge. Immediately after that hearing, Mr Singh decided that it was in his personal interests to discontinue the proceeding and went to the Registry to ascertain how the proceeding might be brought to an end. He was informed by Registry staff that he could discontinue the proceeding by filing a notice in the appropriate form.  He was provided with a copy of that form of notice.  He was also told that, if he did file a notice of discontinuance, the rules of court provided that he would be required to pay the respondent’s costs, if asked.  However, the Registry staff further suggested to Mr Singh that he would not need to pay costs if he reached an agreement to that effect with the respondent.

·                     Mr Singh then spoke with the solicitor for the respondent to see whether the respondent would bear his own costs if the case was discontinued.  The solicitor obtained instructions to that effect. Mr Singh and the solicitor then signed minutes of consent orders and filed them under O 35 r 10.  In those minutes, Mr Singh and the respondent sought an order that the proceeding be dismissed with no order as to costs.

·                     Within a day or so of filing the consent orders (and before their formal entry), Mr Singh informed the Court Registry that he no longer wished those orders to be made.  He said that he wanted his appeal from the decision of the Tribunal to proceed. Having been informed of this, the primary Judge instructed the Registrar not to perfect the orders and listed the matter for hearing.

·                     At the hearing on 2 February 2001, Mr Singh informed his Honour that after the directions hearing on 15 December 2001 he had been under “a huge amount of stress and severe depression” and for that reason, had agreed to discontinue the action.  He wished to revoke his consent to the proposed orders because he had had a change of heart.  He said that one reason for that change was his mistaken belief that at the time of signing the minutes he could obtain redress otherwise than by continuing with his appeal against the Tribunal’s decision.

THE PRIMARY JUDGE’S REASONS

4                     The primary Judge observed that the question to be decided by him was whether Mr Singh is entitled, as a matter of law, to revoke his consent to the orders that the proceeding be dismissed with no order as to costs.  In finding that Mr Singh was not entitled to revoke his consent, the primary Judge referred to the decision of Harvey v Phillips (1956) 95 CLR 235 as authority for the proposition that if consent orders are agreed in pursuance of an agreement made between the parties, then that agreement binds those parties, unless the agreement is set aside, or it is apparent that the agreement is capable of being set aside in a duly constituted proceeding.

5                     His Honour said that the material provided to the Court by Mr Singh did not suggest that the agreement reached with the respondent’s solicitor was capable of being impeached in a way that would justify it being set aside or avoided.  Given that the agreement could not be invalidated and in the absence of an agreement by the parties that the consent orders should not be made, the primary Judge said that he had no choice but to act on the minutes that had been filed and to direct the Registrar to perfect the orders.

THE GROUNDS OF APPEAL

6                     The Notice of Appeal states the following as the grounds of the appeal:

“I was unable to make reasonable decisions due to my mental incapacity when I signed minutes of consent orders to dismiss my appeal V912 of 2000.

Harvey v Phillips (1956) 95 CLR 235 is irrelevant to my case”.

7                     Mr Singh sought to develop these grounds in argument before us by the tender of several medical certificates by his general practitioner stating that Mr Singh was suffering from “chest pain” and “panic disorder” and, in one case, “severe panic disorder”.

CONCLUSIONS ON THE APPEAL

8                     The relevant principles for present purposes were explained in Harvey v Phillips.  The High Court there distinguished between two possible situations, as follows:

9                     One is the situation which exists before the formal entry of judgment.  Here, the Court possesses a judicial discretion to set aside a compromise and to intercept that entry, for instance, in the event of an injustice arising by reasons of misapprehension or mistake made by counsel in consenting to an order.  This discretion may be exercised notwithstanding that there were not grounds sufficient to invalidate a contract under the general law.  But in the case of a compromise made within the actual, as well as the apparent, authority of counsel, a court does not appear to possess an authority to rescind it or set it aside (at 242 – 243).

10                  The second situation is after the entry of formal judgment.  Here (as in the case of a compromise entered into within counsel’s actual and apparent authority), the question whether the compromise is to be set aside depends upon the existence of a ground sufficient to render a simple contract void or voidable, or to entitle the party to equitable relief for illegality, fraud, non-disclosure, duress, mistake, undue influence, abuse of confidence or the like (at 243 – 244).

11                  In the present case, as has been noted, the formal entry of judgment had not occurred.  It followed that the primary Judge was invested with the power to intercept that entry, if the exercise of the judicial discretion was justified.  In this connection, as has been said, it was not necessary, at that stage, for Mr Singh to demonstrate the existence of a ground which would be sufficient under the general law to invalidate a contract.  However, some other reason, sufficient to amount to an injustice, or perhaps potential for an injustice, had to be demonstrated to warrant the exercise of the discretion.

12                  It is true that Mr Singh has suffered panic attacks and, on occasions, severe ones.  It also appears that Mr Singh genuinely claims to have had second thoughts about the wisdom of his entry into the compromise.  But, having had from Mr Singh the benefit of full written and oral submissions, it does not appear to us that an injustice, or potential for injustice, would occur if the compromise were to stand.  For one thing, although the medical certificates mentioned were tendered on the appeal, they do no more than make the very brief statements quoted above.  There was no attempt to adduce expert psychological evidence as to Mr Singh’s capacity to comprehend the effect of the compromise.  This is evidence, if it exists, peculiarly within Mr Singh’s control.  We should infer then that such evidence does not exist.  For another, despite Mr Singh’s earnest endeavours to explain his perception of the matter, it is by no means apparent to us how, on any objective basis, entry into the compromise actually prejudiced Mr Singh.

13                  Further, in Paino v Hofbauer (1988) 13 NSWLR 193 at 198 McHugh J said that when a party asks that a consent order based on a contract should be set aside or varied when the underlying contract could not be set aside or varied, the case would need to be exceptional before the Court would exercise its discretion in favour of an applicant.  Mr Singh has not established that his is an exceptional case.

14                  We would add, for completeness, that we agree with the primary Judge that no ground exists under the general law for interfering with the contract of compromise.

ORDERS

15                  We will dismiss the appeal, and reserve costs.

Associate:

Dated:              21 September 2001