Federal Court of Australia

DIZ18 (by her litigation representative DJA18) (No 3) v Minister for Home Affairs [2023] FCA 1350

ORDERS

THE COURT NOTES THAT:

A.    The Applicant was born on 5 June 2016 and is a person under a legal incapacity within the meaning of Schedule 1 of the Federal Court Rules 2011 (the Rules).

B.    The Applicant commenced this proceeding by her litigation guardian DJA18, by way of Originating Application and Statement of Claim dated 29 June 2018.

C.    The parties have exchanged deeds of settlement and release (Deed) which note that the settlement is subject to the approval of the Court.

D.    The Applicant’s litigation representative applies to the Court for approval of the settlement set out in the Deed, pursuant to r 9.70 of the Rules.

THE COURT ORDERS THAT:

Settlement Approval

1.    The Applicant is granted leave to file an amended Originating Application substantially in the form of Schedule A to her Interlocutory Application dated 19 July 2023.

2.    The settlement set out in the Deed be approved.

3.    Within two (2) days of the making of these orders the Applicant shall send these orders, and (subject to Orders 7 and 8 below) the affidavits filed in support of the settlement approval application to the Senior Master of the Supreme Court of Victoria (SCV).

4.    If the Senior Master of the SCV makes an order under r 79.10(2) of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) that the Settlement Sum (as defined in the Deed) be held in Court for the benefit of the Applicant, the Respondent shall pay the Settlement Sum to the trust account of the Applicant’s solicitors for the benefit of the Applicant.

5.    If the Senior Master of the SCV does not make the order described in Order 4 above, within 28 days of this order, the matter be listed for case management hearing on a date to be fixed.

6.    Within five (5) business days of payment of the Settlement Sum, the parties will file consent orders with the Court, providing that:

(a)    the proceeding be dismissed; and

(b)    the Respondents pay the Applicant’s costs as agreed or taxed in default of agreement.

Confidentiality

7.    Until 3 November 2026 or further order, pursuant to ss 37AF and 37AG of the Federal Court of Australia Act 1976 (Cth) (the Act) and on the ground that it is necessary to prevent prejudice to the proper administration of justice, the Deed of Settlement being “Annexure BM-4” to the affidavit of Bridie Murphy affirmed 13 July 2023, be treated as confidential to the parties to this proceeding, be marked as confidential to the parties on the Court’s Electronic Court File, and not be available for public inspection, disclosed in open court or disclosed in the open part of any court transcript.

8.    Until further order, pursuant to ss 37AF and 37AG of the Act and on the ground that it is necessary to prevent prejudice to the proper administration of justice, the following documents be treated as confidential to the parties to this proceeding, be marked as confidential to the parties on the Court’s Electronic Court File, and not be available for public inspection, disclosed in open court or disclosed in the open part of the transcript of any court proceeding:

(a)    the following annexures to the affidavit of Bridie Murphy affirmed 13 July 2023:

(i)    the bundle of medical reports filed and served on behalf of the applicant being “Annexure BM-1”;

(ii)    the bundle of medical reports filed and served on behalf of the respondents being “Annexure BM-2”;

(iii)    the confidential opinion of Fiona Ryan SC and Stella Gold of counsel dated 11 July 2023 being “Annexure BM-5”;

(iv)    the correspondence between the Applicant’s solicitors and Medicare being “Annexure BM-7”; and

(v)    the letter from the applicant’s solicitors to the Supreme Court of Victoria - Funds in Court dated 5 May 2023 being “Annexure BM-8”; and

(b)    all medical reports filed by the Respondents in the proceeding.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

MURPHY J:

INTRODUCTION

1    Before the Court is an interlocutory application dated 19 July 2023 in which, through her father, DJA18 as her litigation representative, the applicant, DIZ18, who is seven years old, seeks Court approval of an agreement to settle the proceeding pursuant to r 9.70 the Federal Court Rules 2011 (the Rules).

2    The parties also jointly seek confidentiality orders in relation to some of the materials in the application, including the settlement deed and the settlement amount, doing so pursuant to ss 37AF(1) and 37AG(1)(a) of the Federal Court of Australia Act 1975 (Cth) (the FCA).

3    For the reasons I now turn to explain, it is appropriate to approve the settlement and to make the confidentiality orders sought, but to limit the time period for which the confidentiality orders will operate.

FACTUAL AND PROCEDURAL BACKGROUND

4    The applicant’s parents are citizens of Iran who arrived Australia, by boat, without a visa, in September 2013. They are therefore “unlawful maritime arrivals” as defined in the Migration Act 1958 (Cth) (the Act) and at the direction of the respondents, the Minister for Home Affairs and the Commonwealth of Australia, they were taken to Nauru where they were detained in immigration detention. On 5 June 2016, the applicant was born on Nauru. The applicant’s parents and the applicant were subsequently recognised by the Nauruan government as refugees, and until they were brought to Australia pursuant to orders made in this proceeding on 3 July 2018, they lived on Nauru under temporary settlement visas granted by that government.

The applicant’s condition and medical treatment

5    The following history is drawn from my decision in DJA18 as litigation representative for DIZ18 v Minister for Home Affairs [2018] FCA 1050. It is not clear to me whether, or the extent to which, that history is contested by the respondents, and it should be understood as the applicant’s claims rather than as findings.

6    The applicant fell ill on 7 June 2018, two days after her second birthday. She was taken by her parents to the International Health and Medical Services (IHMS) clinic, the medical service contracted to provide healthcare to detainees and refugees on Nauru, where she was prescribed paracetamol syrup to take every four hours. On 11 June 2018 the applicant’s symptoms became significantly worse and she was again taken to the IHMS clinic, where she presented with symptoms of mouth lesions, fever, irritability and dehydration. She was given fluid via an intra osseous needle in her left tibia and remained in a back room of the IHMS clinic for observation and medical management until 12 June 2018.

7    On 12 June 2018 the intra osseous line was removed and the applicant was taken by ambulance to the Republic of Nauru Hospital where a central line was inserted into the applicant under general anaesthetic. She was not admitted to hospital.

8    On 12 June, IHMS consulted Dr John Field, an Emergency Physician and Intensive Care Specialist in Australia, by telephone. He provided a report which briefly noted the applicant’s history and symptoms and said “I am very concerned this represents severe sepsis which carries a high mortality.” Dr Field recommended a course of medication and “urgent evacuation to a first world tertiary hospital”. The same day Dr Shane George, a Paediatric Emergency Physician in Australia, provided a report assessing the applicant’s condition. His report noted “a history and clinical features of severe sepsis, and concerns of a central nervous system source” and said that “meningo-encephalitis is suspected”.

9    IHMS’s clinical records on 12 June record a provisional diagnosis of suspected meningo-encephalitis and noted that:

IHMS have advised that this girl needs admission to a Paediatric Intensive Care Unit in Australia. Await transfer.

(Emphasis added.)

10    On 12 June at 4:24 pm, Antonia Graham, a coordinating registered nurse at IHMS, emailed a request to Australian Border Force (ABF) seeking the applicant’s urgent medical evacuation. She noted that Dr Field and Dr George “both have high concerns of sepsis with high mortality and advise immediate transfer to a tertiary facility with a paediatric intensive care unit.” She also said:

IHMS is aligned with this advice and recommends immediate medevac to Australia or a third country with compatible medical capability that can manage a paediatric emergency with a paediatric ICU.

Without transfer to an appropriate location, the child is at risk of further deterioration and a fatal outcome.

(Emphasis added.)

11    Bridget O’Brien, an Acting Superintendent with the ABF, responded by email shortly afterwards by asking “whether [Pacific International Hospital on Paua New Guinea] or Taiwan are options, and in that order please”. Ms Graham replied by email shortly after that stating that Pacific International Hospital (PIH) was “willing to accept the client under the Consultant Paediatrician Dr Mary Baki”. Ms O’Brien immediately emailed back and said that the Department of Home Affairs would engage with the PNG government to seek approval for the applicant’s transfer to PNG.

12    Later that evening at 7:19 pm, Dr Kalesh Seevnarain, Senior Medical Director of IHMS, sent and email to Elizabeth Hampton, a Departmental officer, stating that IHMS recommended the applicant’s transfer “to Australia or third country of comparable healthcare as its first option” and that IHMS was “unsure” of the paediatric intensive care unit (ICU) capability of PIH.

13    The following morning, 13 June 2018 at 11.06 am, Dr Seevnarain sent that email chain to Ms O’Brien, and reiterated that IHMS recommended medical transfer to Australia as “the first option” and that “[w]hile PIH has accepted the child, IHMS does not believe that they have the capability to manage the case.”  Ms O’Brien responded shortly afterwards stating that the Department had confirmed PNG as the destination of transfer, and that Dr Seevnarain should work towards that. Ms O’Brien complained that at no stage “before now” had IHMS said that PIH did not have capacity to manage the applicant’s case.

14    The applicant was medically transferred to PNG the following day. On the applicant’s arrival at PIH late on the afternoon of 14 June 2018 the consultant paediatrician at PIH, Dr Mary Baki, assumed clinical responsibility for her treatment. Dr Baki made a provisional diagnosis of herpes encephalitis. By that time the applicant was responding well to Acyclovir, a herpes medication recommended by Dr George and continued by Dr Baki. PIH performed a CT scan of the applicant’s brain on 15 June 2018, which was assessed as unremarkable. The CT scan noted though that a normal brain scan does not rule out the possibility of an acute and encephalitic process and, if clinically warranted, a follow-up contrast enhanced computed tomography scan is recommended.

15    By then the applicant was legally represented. On 17 June 2018, Maurice Blackburn Lawyers wrote to the Australian Government Solicitor (AGS) raising a question as to when a MRI brain scan would be performed on the applicant. The Australian Government Solicitor responded by saying that PIH considered a CT scan was preferable to an MRI under sedation for a child recovering from encephalitis.

16    Maurice Blackburn had engaged a paediatric neurologist, Dr Michael Harbord, and he provided a written opinion dated 27 June 2018, which was provided to the AGS the next day. Dr Harbord said that that brain injury as a result of herpes encephalitis is relatively common, and that in Australia the standard of care for a child suffering from that condition requires that an MRI brain scan under sedation and an electroencephalogram (EEG) be performed within a week of diagnosis. He said that it was important to do an MRI as soon as possible to increase the chances of seeing the signal changes in the brain which represent the areas of inflammation, as that will indicate the likely clinical outcomes for the patient thereby allowing treating medical practitioners to know what to anticipate in the patient’s treatment.

The injunction application

17    On 29 June 2018, the applicant commenced this proceeding through her litigation representative, by way of originating application and statement of claim. The application was accompanied by an interlocutory application seeking orders to require the respondents to urgently bring the applicant to Australia for medical treatment accompanied by her parents. At that time the proceeding did not seek damages.

18    The application came before me at 3:00 pm on Friday, 29 June 2018. On the respondents giving an undertaking not to take steps to remove the applicant and her mother back to Nauru prior to the hearing of the application, I adjourned the hearing to 3 July 2018.

19    I heard the interlocutory application on 3 July 2018. By that date the applicant had not undergone either an MRI or an EEG.

20    Counsel for the respondents told the Court that it had only recently become clear to them that PIH was not in fact equipped to conduct an MRI under sedation on a child of the applicant’s age, and the evidence indicated that the only neurologist able to conduct an EEG at PIH was away on a break for an unspecified duration.

21    Upon hearing the application I made orders that day to require the respondents to:

(a)    bring the applicant and her mother to Australia as soon as reasonably practicable and within 48 hours;

(b)    bring the applicant’s father, who was still on Nauru, to Australia as soon as reasonably practicable and by 6 July 2018;

(c)    ensure that the applicant receives treatment at an Australian tertiary level hospital in accordance with the recommendations of Dr Harbord, including:

(i)    an MRI brain scan with sedation performed by a paediatric anaesthetist;

(ii)    EEG testing; and

(iii)    the review of the applicant and any further treatment be overseen by a paediatric neurologist.

The amendment to claim damages

22    On 6 March 2019 the applicant filed an amended statement of claim in which she sought damages in negligence for injury, loss and damage suffered by reason of the respondents’ breach of its alleged duty to provide her with a reasonable standard of medical care.

23    The damages claim has been strenuously contested from the outset, and the proceeding has had a somewhat tortuous procedural path.

Separate questions to the Full Court

24    In this proceeding, and in a cohort of approximately 50 other similar cases, the respondents submitted that the Court had no jurisdiction to hear the cases by operation of s 494AB of the Act. Four cases, including this proceeding, were selected as a representative sample of the cohort, and separate questions were referred to the Full Court. On 28 August 2019 the Full Court held in each of the four cases that s 494AB of the Act did not have the effect that the proceeding could not be instituted or could not be continued in the Court: FRM17 v Minister for Home Affairs [2019] FCAFC 148; 271 FCR 254 (Kenny, Robertson and Griffiths JJ).

Appeal to the High Court

25    The respondents appealed the judgment of the Full Court to the High Court. On 2 December 2020 the High Court held that s 494AB of the Act did not have the effect that the proceeding could not be instituted or could not be continued, but that in an appropriate case the respondents could plead that the section applied to the proceeding and to seek that the proceeding as then framed be stayed. In Minister for Home Affairs v DMA18 as litigation guardian for DLZ18 [2020] HCA 43; 270 CLR 372 (Kiefel, Bell, Gageler, Keane and Gordon JJ) the High Court explained (at [4]) that, in practical terms, s 494AB “creates a defence which the Commonwealth may, but need not, plead to specific claims in all courts, except the High Court. If no practical benefit is to be gained by raising s 494AB, the Commonwealth acting as a model litigant need not and, it may be expected, would not raise it.”

26    It appears, but I have had no submissions on this, that the Commonwealth saw no practical benefit in raising s 494AB as a defence to this proceeding because that provision does not apply to proceedings commenced in the High Court. Thus, if the Commonwealth raised the defence the applicants could bring another proceeding in the High Court making the same allegations.

Transfer to Justice Wheelahan

27    The cohort of similar proceedings, including this proceeding, were then docketed to Justice Wheelahan for case management and hearing. On 9 August 2022 his Honour granted leave to the applicant further amend the statement of claim to include claims for aggravated damages and/or exemplary damages: DIZ18 (by her litigation representative DJA18) v Minister for Home Affairs (No 2) [2022] FCA 898 (Wheelahan J). On 7 October 2022 the applicant filed a third amended statement of claim including a claim for aggravated and/or exemplary damages.

THE Claims and Defences Summarised

The Claims

28    In broad summary, the third amended statement of claim alleges that the respondents owed the applicant a duty of care to ensure that reasonable care was taken in the provision to her of medical services; that the medical treatment she received on Nauru from 7 June 2018 onwards fell below a reasonable standard of care and was in breach of the respondents’ duty of care, and that the applicant thereby suffered injury, loss and damage.

29    It is alleged that had the applicant been given appropriate medical treatment her condition would have been diagnosed earlier and she would have been prescribed oral Acyclovir earlier, which would have avoided her suffering neurological impairment, or would have substantially reduced the neurological injury she has suffered. By reason of the respondents’ negligence it is alleged the applicant suffered the following injuries:

(a)    acute and short-term injuries, including serious dehydration by 11 June 2018 and critical hypovolaemic shock, a requirement to drill a hole in her shin to provide intraosseous fluids without adequate analgesia, insertion of a central line under anaesthetic at the Republic of Nauru Hospital on 12 June 2018, transfer to PNG with her mother and a traumatic separation from her father who was the primary caregiver, and insertion of a second line at the PIH which caused neck scarring;

(b)    ataxia, being loss of balance and regression in mobility, for approximately six months; and

(c)    long-term neurological impairment, which is unlikely to have occurred if adequate treatment had been commenced in a timely manner, leading to risks of reduced academic achievement and vocational outcomes affecting her future earnings.

The applicant seeks damages for pain and suffering, loss of earning capacity, future medical and like expenses and therapy, the gratuitous attendant care voluntarily provided by her parents for their attendance to the needs of the applicant as a result of her injuries up to 20 May 2022, plus interest. The applicant also claims the reasonable administration fees for management of any award of damages or settlement monies.

30    The applicant claims aggravated and exemplary damages founded in the allegation that the respondents’ decision to transfer her to PNG went beyond mere negligence and into the realm of a deliberate decision that was made in contumelious disregard for her health. It is alleged that the respondents deliberately did not follow the medical advice provided by IHMS and consultant specialists when the respondents transferred the applicant for treatment at the PIH, instead of to an Australian tertiary level hospital with a paediatric ICU, or to that of another country with comparable medical capabilities.

The defences

31    From the outset the respondents have denied the applicant’s claims. In their further amended defence filed 14 November 2022 the respondents, amongst other things:

(a)    deny that the medical treatment the applicant received on Nauru or PNG was inadequate;

(b)    allege that while the applicant was on Nauru she was subject to the laws of Nauru and the sovereignty of the government of Nauru, and deny that the respondents had assumed responsibility for the applicant’s health and welfare or for the provision of medical services;

(c)    deny that they owed the applicant a duty of care, nondelegable or otherwise, to ensure that reasonable care was taken in the provision of medical services to her;

(d)    say that the posited duty and the standard of care pleaded is inconsistent with the statutory duty in s 198AD of Act; the non-compellable nature of the power in s 198AE; the discretionary and temporary nature of s 198B; and the scheme of Subdiv B of Div 9 of Pt 2 of the Act;

(e)    say that the applicant’s allegations concerning her medical treatment in Nauru and transfer to PNG impermissibly invite the Court to apply the standard of negligence to decisions of high-level government policy, which involve or are dictated by economic, social and political factors, including the second respondent’s relationships with foreign governments, and in respect of which the Court should not impose a duty of care;

(f)    say that the imposition of a duty of care in relation to the applicant’s period in Nauru and transfer to PNG is incompatible with the statutory duty in s 198AD(2) of the Act; and the purpose of Subdiv B of Div 8 of Pt 2 of the Act; and

(g)    deny any liability for damages, including aggravated and exemplary damages.

THE SETTLEMENT APPROVAL APPLICATION

The materials

32    By an interlocutory application dated 19 July 2023 the applicant seeks orders for approval of the settlement (proposed settlement) contained in a Deed of Settlement between the parties dated 15 June 2023 (Deed).

33    The applicant relies upon the comprehensive affidavit of Bridie Murphy, a senior associate with Maurice Blackburn Lawyers, the solicitors for the applicant, affirmed 13 July 2023, which has numerous annexures including:

(a)    the applicant’s filed and served medical reports;

(b)    the respondents’ filed and served medical reports;

(c)    a copy of the Deed;

(d)    a copy of the confidential opinion of Fiona Ryan SC and Stella Gold of counsel (Confidential Opinion) dated 11 July 2023, in support of settlement approval; and

(e)    a short affidavit of DJA18 affirmed on 13 July 2023, in which he deposes that he has read and understood the Counsel’s Confidential Opinion and confirms his instructions to accept the terms of the proposed settlement.

34    The applicant filed written submissions in support of settlement approval dated 13 September 2023.

Applicable principles

35    Pursuant to r 9.70 of the Rules, if on behalf of a party to a proceeding under a legal incapacity a litigation representative agrees to settle a matter in dispute in a proceeding, the litigation representative must apply to the Court for approval of the agreement. The agreement is not binding on the person under a legal incapacity until such time as the Court approves it.

36    The Court’s task pursuant to r 9.70 is to determine whether the proposed settlement is in the best interests of the person under a disability or beneficial to that person’s interests: Scandolera v State of Victoria [2015] FCA 1451; 331 ALR 525 at [27]-[29] (Mortimer J, as her Honour then was). The Court should be concerned only with the benefit to the person under a disability: Modra v State of Victoria [2013] FCA 1041 at [12] (Tracey J).

37    That task is not prescribed by the Rules themselves, rather it is implied by the nature of the jurisdiction where the party is under a disability and unable to conduct the litigation on his or her own behalf: Elliot v State of Victoria (Department of Education & Training) [2018] FCA 1029 at [17] (Mortimer J).

38    The determination of whether the proposed settlement is in the best interests of, or beneficial to, the interests of the person under a disability, requires the Court to weigh, at least as an important consideration, the prospects of the applicant succeeding if the proceeding continues: Fisher v Marin [2008] NSWSC 1357 at [35]-[36] (Rothman J). Because approval of the settlement will have the effect of binding the applicant to the terms of the settlement and bringing the proceeding to an end, it follows that the Court should consider the advantages and disadvantages of the proceeding continuing by reference not just to whether the applicant may secure a more advantageous outcome if the Court found in her favour, but also the prospects of an appeal, and the costs and pressures imposed on the applicant if the proceeding went to trial, including the emotional and psychological strain of litigation: Scandolera at [29]; Fisher at [35]-[36].

39    Another important consideration is how the settlement sum is to be preserved for the applicant’s benefit. Unless preservation of the settlement sum can be achieved the Court may have doubt about whether the settlement proposal is beneficial. To avoid the possibility of dissipation it may be appropriate for the sum to be held securely in trust and applied toward the applicant’s educational, developmental or health interests: Scandolera at [32]; Freeman v State of Victoria [2018] FCA 797 at [12] (Moshinksy J).

Consideration

40    For the following reasons I am satisfied that the proposed settlement is within the range of reasonable outcomes of the proceeding, and in the applicant’s best interests. It is appropriate to approve the settlement.

41    First, the applicant, through her father as litigation representative, has agreed to the proposed settlement having had the benefit of legal advice from experienced and competent lawyers, and having read the Confidential Opinion. The applicant’s father is in a good position to understand what is in his daughter’s best interests.

42    Second, having regard to the statutory context in which the applicant’s claim arises, her claims as to the existence and breach of a non-delegable, or in the alternative a delegable, duty to provide reasonable medical care are novel and contestable. Further, having regard to the medical reports annexed to Ms Murphy’s affidavit there are some significant differences between the parties on some of the factual questions in the case. Those matters too are contestable. The claim has been strenuously defended to date, and if settlement is not approved it seems likely that will continue. The proceeding has already been on foot for more than five years and even if heard in the first half of next year it will have been six years before it is determined. Then, there is a prospect of an appeal due to the novel legal issues in dispute.

43    Third, I have had the benefit of considering the Confidential Opinion of Fiona Ryan SC and Stella Gold of counsel dated 11 July 2023. Both Ms Ryan and Ms Gold have been briefed in the case for a lengthy period and the opinion shows they have a detailed knowledge of the issues and the evidence in the case. I cannot go to the detail of the Confidential Opinion and it must suffice to note that counsel gave careful consideration to the medical evidence, the risks on liability, the risks in relation to quantum, and the best possible recovery for the applicant. Counsel concluded that the proposed settlement is reasonable in all the circumstances and is in the applicant’s best interests.

44    Counsel provided the Confidential Opinion to assist the Court in its protective function, as distinct from acting as an advocate upon their client’s instructions (Bannister v State of Victoria [2012] FCA 1341 at [12] (Murphy J)) and it is appropriate to give substantial weight to it.

45    Fourth, with respect to preservation of the settlement sum, it is proposed that the funds be paid into the trust account of the applicant’s solicitor, and thereafter be transferred to the Funds in Court division of the Supreme Court of Victoria (SCV) on the applicant’s behalf. In her affidavit Ms Murphy deposes to the enquiries made by Maurice Blackburn Lawyers as to the SCV’s preparedness to receive the funds and the Office of the Senior Master of the Funds and the Court’s explicit advice about the wording of an order to be made by this Court so as to give effect to the arrangement.

46    This Court does not have a scheme equivalent to that of the SCV, and the practice of this Court referring the administration of settlement sums to the SCV is, now, common. I am satisfied that doing so will ensure that the settlement sum is preserved for the applicant’s benefit. I have made orders in the terms advised to Ms Murphy as appropriate by the Office of the Senior Master of the Funds in Court.

THE CONFIDENTIALITY APPLICATION

47    By an interlocutory application dated 17 August 2023 the parties jointly seek that the terms of the Deed including the settlement amount to be kept confidential, and prohibited from disclosure by publication or otherwise, except as provided by the Deed, doing so pursuant to s 37AF(1) and 37AG(1) of the FCA on the ground that it is necessary to prevent prejudice to the administration of justice.

48    The respondents rely on an affidavit of Dejan Lukic, a senior executive lawyer with the Australian Government Solicitor, the solicitor for the respondents, affirmed 26 July 2023. They also seek confidentiality orders in respect to paragraph 12 of that affidavit and the sub- paragraph 6(a) and (e) of the respondents written submissions dated 8 September 2023. I made interim confidentiality orders in relation to that material on 20 September 2023, to operate until determination of the application for suppression and nonpublication orders.

49    The applicant also seeks confidentiality orders in respect of:

(a)    some of the annexures to Ms Murphy’s affidavit, namely;

(i)    the bundles of medical reports which are “Annexures BM-1 and BM-2”;

(ii)    the Confidential Opinion which is “Annexure BM-5”;

(iii)    the correspondence between the solicitors for the applicant and Medicare which is “Annexure BM-7”;

(iv)    the correspondence between the solicitors for the applicant and SCV Funds in Court which is “Annexure BM-8”; and

(b)    all medical reports filed by the respondents in the proceeding.

I also made interim confidentiality orders in relation to that material on 18 August 2023.

The evidence

50    The respondents filed written submissions in support of confidentiality orders dated 8 September 2023 and the applicants filed written submissions on the question dated 13 September 2023.

Consideration

51    The application for a confidentiality order is made under s 37AG(1) of the FCA on the basis that the order is “necessary to prevent prejudice to the proper administration of justice”.

52    As I said in Gray v State of Victoria (Department of Education and Early Childhood Development) [2017] FCA 353 at [21]-[22]:

The use of the word “necessary” in s 37AG(1)(a) indicates a reasonably strict test: Hogan v Australian Crime Commission (2010) 240 CLR 651; [2010] HCA 21 at [30] (French CJ, Gummow, Hayne, Heydon and Kiefel JJ) in relation to a predecessor provision; Rinehart v Welker [2011] NSWCA 403 (Rinehart) at [27] (Bathurst CJ and McColl JA) and at [105]-[106] (Young JA).

The concept of the administration of justice is multi-faceted: Rinehart at [39]. It incorporates:

(a)    the public interest in the preservation of the confidentiality of the mediation process and the process of negotiation of the settlement of litigation: Sharjade Pty Ltd v RAAF (Landings) Ex-Servicemen Charitable Fund Pty Ltd [2008] NSWSC 1347 at [34] (Bergin J); Cannon v Griffiths & Ors (No 2) [2015] NSWSC 1329  at [14] (Beech-Jones J);

(b)    the public interest in keeping people to their freely-entered bargain: Baltic Shipping Co v Dillon [1991] NSWCA 19; 22 NSWLR 1 at 9 (Gleeson CJ);

(c)    the public interest in the settlement of proceedings prior to trial: Oldham v Capgemini Australia Pty Ltd (No 2) [2016] FCA 1101 at [24] (Mortimer J); Reynolds v JP Morgan Administrative Services Australia Limited (No 2) (2011) 193 FCR 507; [2011] FCA 489 at [30] (Rares J).

53    The Court has been satisfied that it is appropriate to make orders to protect the confidentiality of the terms of settlement of a proceeding brought by a person under a legal incapacity, and the confidential opinion of counsel in support of a settlement approval application, for reasons including the following:

(a)    the likelihood that a settlement would not have occurred without the prospect of such protection: Elliott v State of Victoria [2018] FCA 1029 at [24] (Mortimer J, as her Honour then was); James v WorkPower Inc [2019] FCA 1239 at [18] (Mortimer J, as her Honour then was). Bushby (by his litigation representative Webling) v Victoria (Department of Education and Training) (No 2) [2023] FCA 34 at [25] (McEvoy J);

(b)    so that future parties, that is, not the parties in the proceeding before the Court, can have confidence that the Court may be prepared to facilitate resolution of such proceedings, including by orders for confidentiality as to the terms of settlement and counsel’s opinion in support of settlement approval: Elliott at [18]; James at [18]; Bushby at [25];

(c)    the conserving of the parties’ and the Courts resources by the facilitation of consensual resolution: Elliott at [24]; and

(d)    bringing finality to the litigation; Elliott at [24].

54    Although the application for confidentiality is joint, I infer from Mr Lukic’s affidavit and the surrounding circumstances that the respondents are the primary drivers behind it. In a proceeding like the present case, a question arises as to whether it is in the interests of the administration of justice to make a confidentiality order in respect to the settlement sum. Essentially, the applicant alleges that notwithstanding clear advice from her treating doctors and consultant specialists that it was necessary for the applicant, then just two years old, to be urgently medically evacuated from Nauru to Australia for urgent treatment in a tertiary hospital within a paediatric ICU, the respondents instead took the applicant to a hospital in PNG where it is alleged she did not receive adequate medical treatment, and suffered injury, loss and damage as a result. It seems likely that, at trial, the applicant’s lawyers will argue that the decision to take her to PNG rather than Australia was not based on considerations regarding the applicant’s healthcare, and was more likely to have been made in pursuit of other governmental objectives, including political objectives.

55    Under s 37AE of the Act in deciding whether to make a suppression or non-publication order I must take into account that “a primary objective of the administration of justice is to safeguard the public interest in open justice.” It must be kept in mind that the applicant’s claims are not proven and that the respondents deny them. The proposed settlement is without admission of liability. But at the same time the respondents have agreed to settle the applicant’s claims, and they seek confidentiality over the settlement terms and the settlement amount. The applicant’s claims are not established but it remains the case that there is a public interest in the treatment of asylum seekers and refugees Australia’s compliance with its obligations under the Act and/or the Refugees’ Convention. It can reasonably be said that there is a public interest in the types of claims the applicant makes, particularly the allegations founding the claim for aggravated and exemplary damages.

56    I have given the question careful reflection. It is not clear-cut in my view, but I have decided that it is appropriate to make the confidentiality orders in relation to the terms of settlement, including the settlement amount, and in relation to any other material that would indicate the settlement amount.

57    I do so, first, because the applicant has agreed to confidentiality in respect to the terms of the Deed and the settlement amount. There is a public interest in keeping people to their freely entered bargains: Baltic Shipping at 9. DJA18’s affidavit shows that he considers the proposed settlement, which includes the confidentiality terms, to be in the applicant’s interests.

58    My role in deciding whether to approve the proposed settlement is protective of the interests of the person under a disability. But it is different to the role I regularly assume in deciding whether to approve a proposed settlement in a representative proceeding under s 33V of the FCA. There, the proposed settlement is reached between the parties and the Court’s protective role is in relation to the interests of absent group members. Here, the parties to the bargain are both before the Court and, although I consider the respondents are likely to be the main drivers, the parties jointly seek confidentiality orders. In Cannon at [17] Beech-Jones J said in respect of the confidentiality term in that settlement, “[i]n my view the public interest in respecting that settlement would tend to be undermined by removing an assumption on which the settlement was arrived at, namely the confidentiality of its terms.”

59    Second, as I have said, it seems likely that the respondents required confidentiality as a term of the offer of settlement. It may be that the settlement would not have occurred without the prospect of such protection for the respondents. The interests of the administration of justice include facilitating the consensual resolution of proceedings: Elliott at [24].

60    Third, here the respondents are faced with a large cohort of similar proceedings commenced by a detainee taken by the Commonwealth to Nauru or PNG and in which the applicant claims damages due to the alleged negligence of the respondents. Mr Lukic deposes that many of those proceedings are yet to be mediated. He says that the consensual resolution of those proceedings will be assisted by the making of confidentiality orders in this proceeding, and that the respondents’ position in respect of other mediations may be prejudiced if the terms of settlement in the present case were made publicly available. I consider the interests of justice will be served if parties in future proceedings, including the respondents, can have confidence that the Court may be prepared to facilitate resolution of such proceedings on terms which include confidentiality as to the settlement amount: Elliott at [18]; James at [18]; Bushby at [25].

61    Fourth, there is a public interest in settlement of proceedings before trial (Oldham at [24]), and the thrust of Mr Lukic’s evidence is that, if confidentiality orders are not made, it will reduce the likelihood of settlement in other cases.

62    Fifth, were it not for the fact that the applicant is a minor and therefore r 9.70 of the Rules requires Court approval of the proposed settlement, the Deed would have remained confidential between the parties. I accept the respondents’ submission that in such circumstances a court should be slow to allow a stranger the proceeding to potentially have access to the confidential terms of settlement.

63    I must also decide how long that order should operate for. Section 37AJ of the FCA provides that in deciding the period for which a confidentiality order is to operate, the Court must “ensure that the order operates for no longer than is reasonably necessary to achieve the purpose for which it is made.” The parties did not make any submissions as to how long the proposed confidentiality orders should operate for. I infer that they seek that the confidentiality orders should continue indefinitely, or until further order.

64    If that is the parties’ position, I take a different view. Here, one of the central reasons why I have concluded that a confidentiality order is necessary to prevent prejudice to the proper administration of justice is that the likelihood of the parties being able to reach a settlement in the cohort of similar proceedings before the Court will be reduced if confidentiality is not allowed. The resolution of those cases by mediation or determination will remove one of the main justifications for impinging on the public interest in open justice. Accordingly, I consider it appropriate to limit the term of the confidentiality orders to three years from today’s date. If by that time some of the cohort of cases are still pending one or other of the parties can apply to extend the orders. Such an order will mean that confidentiality operates for no longer than is reasonably necessary.

65    I take a somewhat different view in relation to the Confidential Opinion. In providing that opinion counsel were obliged to candidly set out their views as to the strengths and weaknesses of the applicant’s case, doing so to assist the Court in its protective role rather than as an advocate for the applicant. If at some later point that opinion was to become public, and available to the Commonwealth for use in other proceedings, there is a risk that counsel will be less frank in the future when setting out their views in relation to any weaknesses in their client’s case. In my view the Confidential Opinion should remain confidential unless or until a judge orders otherwise.

66    The medical reports regarding the applicant’s medical condition are a different category again. They reveal the identity of the applicant and her family and they also go to matters which are private to the applicant, who is a minor. It is not in the interests of the administration of justice for reports going to the applicant’s medical conditions to be made publicly available. In my view those reports should remain confidential unless or until a judge otherwise orders. The same is true of the correspondence between the solicitors for the applicant and Medicare and the letter from the solicitors for the applicant to Funds in Court, as those documents both reveal the nature of some of the applicant’s medical conditions and her identity.

67    Finally, I can see no basis for the respondents’ application for orders that paragraph 12 of the affidavit of Mr Lukic and subparagraphs 6(a) and (b) of the respondent’s written submissions be ordered to be confidential. Paragraph 12 of Mr Lukic’s affidavit says no more than that the Deed provides that its terms be confidential. The same can be said of subparagraphs 6(a) and (b) of the respondent’s written submissions. The fact that the Deed provides that its terms be confidential is one of the reasons why I have decided to approve the confidentiality orders sought. And I have said so in these reasons. In such circumstances it cannot sensibly be said that it is necessary to prevent prejudice to the administration of justice that it be kept confidential that the settlement terms are confidential.

CONCLUSION

68    I have made orders to approve the proposed settlement, and for the terms of the Deed including the settlement amount to be kept confidential for three years, as well as orders for the Confidential Opinion and various annexures to the affidavit of the applicant’s solicitor to be kept confidential without a time limitation.

Associate:    

Dated:        3 November 2023