Court of Appeal Supreme Court New South Wales

• Medium Neutral Citation: Rinehart v Welker [2012] NSWCA 1
• Hearing dates: 13 January 2012
• Decision date: 13 January 2012
• Before: Bathurst CJ, Beazley JA, McColl JA

Decision

1. Order 1 made by the Court of Appeal in these proceedings on 19 December 2011 be stayed up to and including 3 February 2012.

2. The stay in Order 1 shall not extend to a report of the proceedings in this Court on 19 and 21 December 2011 or 13 January 2012 excluding any reference to the provisions of the Deed between the first, second and third respondents and the applicants and various other parties dated 7 August 2006 and to the affidavit of John Dalzell sworn 6 October 2011 except to the extent that it is necessary for that material to be referred to in the judgment on this application.

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

• Catchwords: APPEAL - precedent - power to depart from previous decision of Court - test in Gett v Tabet - altering practice as distinct from altering a decision on a question of law - whether Court of Appeal practice should be altered when inconsistent with practice of the High Court and other intermediate Australian courts; PROCEDURE - civil - judgments and orders - stay - pending special leave to appeal to the High Court - test in John Fairfax & Sons Ltd v Kelly (No 2) (1987) 8 NSWLR 510 conflicts with test in Jennings construction Ltd v Burgundy Royale Investments Pty Ltd (No 1) [1986] HCA 84 - whether exceptional circumstances must be shown before a stay is warranted; PROCEDURE - civil - judgments and orders - stay - pending special leave to appeal to the High Court - whether substantial prospects of obtaining special leave - whether short stay appropriate even if no substantial prospects of obtaining special leave
• Legislation Cited: Court Suppression and Non-publication Orders Act 2010, s 6, s 8; Commercial Arbitration Act 2010, s 1, s 2, s 8, s 21, s 27E, s 27F, s 27G, s 27H, s 27I; Federal Court of Australia Act 1976 (Cth), s 17, s 50; Judiciary Act 1903 (Cth), s 35A
• Cases Cited: Adeels Palace Pty Ltd v Moubarak [2009] NSWCA 130; Australian Broadcasting Commission v Parish (1980) 43 FLR 129; Australian Football League v Carlton Football Club (Court of Appeal, 1 August 1997, unreported); Australian Securities Commission v Marlborough Gold Minds Ltd [1993] HCA 15; (1993) 177 CLR 485; Comandate Marine Corp v Pan Australia Shipping Pty Ltd [2006] HCATrans 353; Denning v Jet Development Pty Ltd [2007] QCA 63; Duke Group Ltd (in liq) v Pilmer [1999] SASC 373; Edelsten v Ward (No 2) (1988) 63 ALJR 346; Esso Australia Resources Ltd v Plowman (Minister for Energy and Minerals) [1995] HCA 19; (1995) 183 CLR 10; Farah Constructions Pty Ltd v Say-dee Pty Ltd [2007] HCA 22; (2007) 230 CLR 89; Gerah Imports Pty Ltd v The Duke Group (in liq) [1994] HCA 3; (1994) 68 ALJR 196; Gett v Tabet [2009] NSWCA 76; (2009) 254 ALR 504; Gunns Limited v Alishab (No 3) [2009] TASSC 103; Hamersley Iron Pty Ltd v Lovell (No 2) (1998) 20 WAR 79; Haydon v Chivell [1999] HCA 39; Hogan v Australian Crime Commission [2010] HCA 21; (2010) 240 CLR 651; House v The King (1936) 55 CLR 499; International Litigation Partners Pte Ltd v Chameleon Mining NL [2011] NSWCA 186; Jemena Gas Networks (NSW) Ltd v Mine Subsidence Board [2010] NSWCA 146; Jennings Construction Ltd v Burgundy Royale Investments Pty Ltd (No 1) [1986] HCA 84; (1986) 161 CLR 681; John Fairfax & Sons Ltd v Kelly (No 2) (1987) 8 NSWLR 510; Miller v Nationwide News Pty Ltd [2008] NSWCA 261; Minister for Local Government v South Sydney City Council (No 3) [2002] NSWCA 327; Palmer v Permanent Custodians Ltd [2009] VSCA 164; Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (No 2) [1998] HCA 32; (1998) 72 ALJR 869; Politarhis v Westpac Banking Corp (No 2) [2009] SASC 109; Rinehart v Welker [2011] NSWCA 345; Rinehart v Welker [2011] NSWCA 425; Sibuse Pty Ltd v Shaw (No 2) (1988) 13 NSWLR 125; Territory Insurance Office v Costa [2002] NTCA 1; (2002) 11 NTLR 212; Walter v National Australia Bank [2004] VSCA 184; White v State Bank of NSW [2002] NSWCA 408
• Category: Interlocutory applications
• Parties: Gina Hope Rinehart (First Applicant); Ginia Hope Francis Rinehart (Second Applicant); Hope Rinehart Welker (First Respondent); John Langley Hancock (Second Respondent); Bianca Hope Rinehart (Third Respondent); Australian Broadcasting Corporation (Media Interests); Fairfax Media Publications Pty Ltd (Media Interests); Nationwide News Pty Ltd (Media Interests)
• Representation: Counsel; M Walton SC and P Kulevski (First Applicant); M Holmes QC and M Allars (Second Applicant); A S Bell SC and D F C Thomas (First, Second and Third Respondents); A T S Dawson and F T Roughley (Media Interests); Solicitors; Corrs Chambers Westgarth (First Applicant); Gadens Lawyers (Second Applicant); Johnson Winter & Slattery (First, Second and Third Respondents); Addisons Lawyers (Media Interests)
• File Number(s): CA 2011/344306; 2011/344307
• Publication restriction: See judgment orders.

Decision under appeal

• Citation: Rinehart v Welker [2011] NSWCA 403
• Date of Decision: 2011-10-31 00:00:00
• Before: Bathurst CJ, McColl JA, Young JA
• File Number(s): CA 2011/344306; 2011/344307

Judgment

1 THE COURT: By amended Notices of Motion filed on 6 January 2012 and 9 January 2010 respectively, the applicants, Ms Gina Rinehart and Ms Ginia Rinehart, sought orders that the orders made by the Court in these proceedings on 19 December 2011 (the review orders) be stayed until the determination of the application for special leave to appeal to the High Court from the judgment in which the review orders were pronounced, (Rinehart v Welker [2011] NSWCA 403, the "review judgment"), or until further orders of this Court or the High Court of Australia.

2 The motions were heard on 13 January 2012. At the conclusion of the hearing the Court made the following orders:

1. Order 1 made by the Court of Appeal in these proceedings on 19 December 2011 be stayed up to and including 3 February 2012.

2. The stay in Order 1 shall not extend to a report of the proceedings in this Court on 19 and 21 December 2011 or 13 January 2012 excluding any reference to the provisions of the Deed between the first, second and third respondents and the applicants and various other parties dated 7 August 2006 and to the affidavit of John Dalzell sworn 6 October 2011 except to the extent that it is necessary for that material to be referred to in the judgment on this application.

3 These are the reasons for those orders.

Background to the proceedings

4 In a judgment delivered on 21 December 2011, Rinehart v Welker [2011] NSWCA 425, Beazley JA set out the background to the proceedings as follows:

"[3] The applicants and respondents, who, for present purposes, may be referred to as the Trustee interests and the Beneficiary interests respectively, are parties to a deed (the Deed) made in 2006, which provides for the submission of disputes " under this Deed " to confidential mediation and arbitration: see the Deed, cl 20. The Deed was entered into following disharmony between the parties, who are all members of a prominent Western Australian family and whose affairs tend to attract media publicity.

[4] On 5 September 2011, an application was made, ex parte , in the Supreme Court, Equity Division, seeking relief in relation to the affairs of a family trust of which Ms Gina Rinehart is the trustee (the Trustee proceedings). The other party in the Trustee interests, Ms Ginia Rinehart, is a beneficiary under the Trust, but has joined with Ms Gina Rinehart in the dispute with the other beneficiaries. The ex parte application was made without any prior resort to the confidential alternate dispute mechanisms for which the Deed made provision.

[5] Ms Gina Rinehart made an application for a stay of the application brought by the Beneficiary interests as well as an application for a suppression order made under the Court Suppression and Non-Publication Orders Act (the Act). On 13 September 2011, Brereton J made an order under s 7 of the Act, prohibiting the disclosure, by publication or otherwise, of any information as to the relief claimed, or any pleading, evidence or argument filed, read or given in, the proceedings. Pursuant to s 9(4), the order did not prohibit disclosure or publication of his Honour's judgment, or of orders made in the proceedings.

[6] On 7 October 2011, Brereton J dismissed the application brought by the Trustee interests to stay the Trustee proceedings on the basis that the Trustee proceedings did not involve a dispute under the Deed, so that cl 20 of the Deed had no application. His Honour ordered that the Trustee proceedings continue on pleadings and gave directions as to the filing and service of the statement of claim. His Honour directed that the pleadings thereafter be filed in accordance with the Rules. I have been informed that the defence is to be filed by 11 January 2012.

[7] His Honour also made an interim suppression order under s 10 of the Act, or alternatively, in the Court's inherent jurisdiction, pending the Trustee interests filing a summons for leave to appeal or the determination of any such application or further order of the Supreme Court, or the Court of Appeal.

[8] The interim suppression order made by Brereton J on 7 October 2011 prohibited disclosure by publication or otherwise of information as to any relief claimed in the proceedings or any pleading, evidence or argument filed, read or given in the proceedings. Pursuant to s 9(4) of the Act, the order did not prohibit disclosure or publication of any judgment given in the proceedings to date or of any orders made in the proceedings.

[9] In his reasons for judgment, Brereton J, at [4], set out the relief sought by the Beneficiary interests in an amended summons which they sought leave to file and which was treated, in the hearing before Brereton J, as the summons upon which the Beneficiary interests would proceed if the stay application made by the Trustee interests failed. Because the relief sought by the Beneficiary interests was contained within the terms of the judgment, it did not fall within the suppression order made by his Honour and is thus now in the public domain.

[10] On 28 October 2011, the Trustee interests filed a summons seeking leave to appeal from the order made by Brereton J dismissing their application for a stay of the Trustee proceedings. The Trustee interests also filed an application seeking an order under the Act prohibiting the disclosure, by publication or otherwise, of any information as to the relief claimed, or any pleading, including the summary of argument, the summons, the draft notice of appeal, evidence or argument filed, read or given in the proceedings the subject of the summons for leave to appeal. This application was made as the orders of Brereton J did not extend to any documentation filed in the Court of Appeal.

[11] On 31 October 2011, Tobias AJA made the following orders:

"1. Pursuant to s.7 of the Court Suppression and Non-publication Orders Act 2010 (NSW) (Act), and on the grounds referred to in s 8(1)(a), a suppression order is made prohibiting the disclosure by publication or otherwise of any information as to the relief claimed or any pleading, the Summary of Argument, submissions, the draft Notice of Appeal, evidence or argument filed, read or given in these proceedings, and including the contents of the red book, blue book, black book and orange book but not including the Summons seeking Leave to Appeal or the pronounced or published judgment of Tobias AJA.

2. Pursuant to s.12 of the Act, the suppression order in paragraph 1 above operates until determination of the Applicant's application for leave to appeal is determined or until further order of the Court.

3. Pursuant to s.11 of the Act, the suppression order in paragraph 1 above applies throughout the Commonwealth."

[12] The Beneficiary interests made an application to review the decision of Tobias AJA pursuant to the Supreme Court Act 1970, s 46. On 19 December 2011, the Court, constituted by Bathurst CJ, McColl and Young JJA, made an order discharging orders 1, 2 and 3 made by Tobias AJA on 31 October 2011. The present applications for a stay are in respect of the order discharging the suppression orders of Tobias AJA.

[13] A further matter of background which should be recorded is that at some stage leave was given to the Australian Broadcasting Commission, Fairfax Media Publications, Nine Network And Nationwide News to intervene in the proceedings. I will refer to the intervening parties as the Media interests."

5 Her Honour ordered that the review orders be stayed up to and including 13 January 2012, that being a date on which it was possible to sit a court of three judges if a further stay was sought.

6 On 6 January 2012, Ms Gina Rinehart filed an application for special leave to appeal to the High Court from the review judgment. On 9 January 2012 Ms Ginia Rinehart filed a similar application.

7 No further substantive steps have been taken in respect of the special leave applications. In particular, no summaries of argument have been filed and no applications for expedition have been made. However, Ms Ginia Rinehart in her submissions in reply in the present application attached a draft summary of argument in support of the application for special leave. In a letter to the respondents dated 11 January 2012, the solicitors for Ms Ginia Rinehart made it clear that those submissions were in draft only and were subject to further consideration by Ms Ginia Rinehart's primary legal representative, Mr Kunc SC, on his return from vacation.

8 In her judgment of 21 December 2011, Beazley JA at [14]-[25] summarised the reasoning of the Court in the review judgment. It is not necessary to repeat that summary in this judgment.

The approach to be taken in determining whether leave should be granted

9 A threshold question which arises on the application is whether the Court in considering whether to grant a stay should adopt the approach taken on such applications by the High Court of Australia or the less stringent approach which has been commonly adopted in New South Wales which derives from the decision of the Court of Appeal in John Fairfax & Sons Ltd v Kelly (No 2) (1987) 8 NSWLR 510 (" Kelly" ).

10 In Jennings Construction Ltd v Burgundy Royale Investments Pty Ltd (No 1) [1986] HCA 84; (1986) 161 CLR 681 (" Burgundy Royale" ), Brennan J made it clear that any application for a stay pending an appeal should first be made in the Court in which the relevant order was made. His Honour made the following remarks (684):

"When an application for special leave to appeal is made to this Court, a jurisdiction to stay may be exercised by the court below and it is to that court - the court in which the matter is pending and which is familiar with the matter - that an application to stay should first be made. In this case the Court of Appeal, not wishing to pre-empt the view that may be expressed in this Court, tailored its order accordingly. In future, there should be no inhibition on the court in which the matter is pending framing a stay order, if a stay be appropriate, to avoid the necessity for application to this Court."

11 Brennan J also emphasised that the jurisdiction to grant a stay is an extraordinary jurisdiction and exceptional circumstances must be shown before a stay is warranted. In that context he made the following remarks (at 684):

"A stay to preserve the subject matter of litigation pending an application for special leave to appeal is an extraordinary jurisdiction and exceptional circumstances must be shown before its exercise is warranted. If an order for a stay is made, the respondent is kept out of the benefit of the order of the court in which the matter is pending until the hearing of the application for special leave to appeal."

And (at 685):

"In exercising the extraordinary jurisdiction to stay, the following factors are material to the exercise of this Court's discretion. In each case when the Court is satisfied that a stay is required to preserve the subject-matter of the litigation, it is relevant to consider: first, whether there is a substantial prospect that special leave to appeal will be granted; secondly, whether the applicant has failed to take whatever steps are necessary to seek a stay from the court in which the matter is pending; thirdly, whether the grant of a stay will cause loss to the respondent; and fourthly, where the balance of convenience lies."

12 Although in the passages referred to above, Brennan J was setting out the approach the High Court should take when considering applications for a stay pending the grant of a special leave application, he did not suggest that intermediate courts of appeal should take a different approach.

13 The approach suggested by Brennan J has been adopted consistently by the High Court in considering such applications.

14 In Edelsten v Ward (No 2) (1988) 63 ALJR 346, Brennan J again emphasised the extraordinary nature of the jurisdiction to grant a stay and that something quite exceptional must be shown before the stay jurisdiction is exercised. His Honour added the following remarks (at 347):

I might add that, even if I were satisfied that the jurisdiction of this Court attached, and that it would be appropriate to consider the exercise of the inherent jurisdiction, nothing that Mr Sweeney has said would satisfy me that the prospects of obtaining special leave to appeal from the interlocutory orders are so substantial or that the damage is so irreversible that the inherent power should be exercised to stay the order of the Tribunal in accordance with its terms.

15 A similar approach was adopted by Dawson J in Gerah Imports Pty Ltd v The Duke Group (in liq) [1994] HCA 3; (1994) 68 ALJR 196. His Honour set out the relevant principles as follows (at 197, footnotes omitted):

"The inherent jurisdiction of this Court to order a stay of proceedings pending the determination of an application for special leave is well established. It is an extraordinary jurisdiction which will only be exercised in exceptional circumstances.

Exceptional circumstances may arise where the subject matter of the proposed appeal will be lost without a stay, with the result that the application for special leave and any subsequent appeal will be nugatory. ...

Notwithstanding this circumstance, the jurisdiction to grant a stay is discretionary and other matters are relevant to the exercise of the discretion.

Importantly, the applicant must establish a substantial prospect that special leave to appeal will be granted. It is, I think, the prospect of success in that application which is significant, although, of course, the prospect of ultimate success in any appeal (if leave is granted) is an important element to be taken into account by the Court in deciding whether or not to grant special leave.

In addition, there are other matters to be taken into consideration in the exercise of the discretion to grant a stay. The failure, if any, of the applicants to pursue such avenues as are available in the court below for obtaining a stay is of significance. Any loss which may be caused to interested parties by the granting of a stay must be taken into account. And the balance of convenience is always something to be considered."

16 A similar approach was taken by Gaudron J in Haydon v Chivell [1999] HCA 39. Her Honour said (at [8], footnotes omitted):

"It is well settled that this court has power to make interim orders pending the grant of special leave to appeal if that is necessary to preserve the subject matter of an appeal or, which is the same thing, to prevent appellate proceedings from being rendered futile. Given the nature of the applicant's claim, this court clearly has power to make the orders sought. However, interim orders are only made if the applicant has a substantial prospect of obtaining the grant of special leave to appeal."

17 In Comandate Marine Corp v Pan Australia Shipping Pty Ltd [2006] HCATrans 353, Heydon J, in refusing a stay, adopted the approach in Burgundy Royale . His Honour noted that there was support in earlier High Court authorities for the proposition that substantial prospects of success was an essential precondition for a stay. However, his Honour did not express a concluded view on that issue.

18 In Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (No 2) [1998] HCA 32; (1998) 72 ALJR 869, Hayne J summarised the approach as follows (footnotes omitted):

"[2] The principles to be applied in such an application are well established. The jurisdiction to grant a stay is part of the inherent jurisdiction of the Court and finds its most frequent use in order to preserve the subject-matter of litigation. ...

[3] To speak only of preserving the subject-matter of litigation may in some cases obscure the fact that the jurisdiction can be invoked, if to grant a stay is necessary to prevent the exercise of rights of appeal being rendered futile or their exercise in circumstances where restoration of the status quo cannot be achieved.

[4] The jurisdiction to grant a stay is, however, an extraordinary jurisdiction and exceptional circumstances must be shown before its exercise is warranted."

The approach taken in New South Wales

19 Prior to the decision in Burgundy Royale the practice of this Court on an application for a stay pending an application for leave to appeal was to grant a stay for a short period to enable a further application to be made to the High Court; Sibuse Pty Ltd v Shaw (No 2) (1988) 13 NSWLR 125 (" Sibuse (No 2)" ) at 127 and 132.

20 Following the decision in Burgundy Royale , the practice to be adopted by this Court was reconsidered in Kelly .

21 In that case the Court (Kirby P, Mahoney and McHugh JJA) suggested the following approach (at 512):

"There is an additional difficulty in considering applications for a stay pending appeal to the High Court of Australia. There is now no appeal as of right from this Court to the High Court. In every case, the special leave of that Court is required. As the statistics appended to the annual reports of the High Court of Australia demonstrated, it is only a minority of cases that such special leave is granted. It could be embarrassing to this Court, having pronounced its orders, to speculate on whether or not a case is one on which special leave to appeal would be granted by the High Court of Australia, such special leave being dependent upon many considerations, some only of which will be known to the parties and to this Court: see Judiciary Act 1903 (Cth), s 35A.

Nevertheless, mindful of the position of the High Court of Australia and of the observations of Brennan J to which we should respond, it is clear that the Court should adopt a more discriminating approach to applications for the grant of a stay pending application for special leave to the High Court, than it has in the past.

Accordingly, upon signification to the Court of the intention of a party to an appeal to this Court that it will seek special leave to appeal to the High Court of Australia, this Court will in future not insist, as in the past, that any such stay (except in exceptional circumstances) should be granted by a justice of the High Court of Australia. Instead the Court will normally grant a stay of twenty-one days from the date of the judgment of this Court, to permit an application to be made for special leave to appeal to the High Court of Australia. Such a stay will normally endure until such application is made or, if leave be granted, the appeal pursuant to such leave is disposed of by the High Court or until the High Court itself otherwise orders.

...

Necessarily, the above course will not modify the discretion of the Court of Appeal to refuse such a stay where, for example, it deems such an application to be plainly hopeless. Nor will it affect this Court's consideration of the position of the opponents when determining any conditions to be imposed or whether it is proper, in the circumstances to decline the stay, requiring any such stay to be granted, as in the past, by a justice of the High Court."

22 Although the media interests sought to submit to the contrary, it seems to us that the approach suggested in Kelly is significantly different to that adopted by the High Court. In particular, an approach which suggests that a stay would normally be granted is not, in our opinion, consistent with an approach which recognises that the jurisdiction is exceptional and would only be granted in extraordinary circumstances.

23 Although it may not be correct to state that this Court has, as a matter of usual practice, granted stays of proceedings pending determination of applications to the High Court, it is correct to say, generally speaking, that it has taken a less stringent approach to that adopted by that Court.

24 In Sibuse (No 2) , Hope and Priestley JJA described the approach to be taken in the following terms (at 132):

"It seems to us that applications for orders in the nature of a stay of judgment should be dealt with by this Court on the footing that the judgment it has just handed down is right, but also with a realistic recognition that it is open to reversal by the High Court. This Court's view of the likelihood of that happening will vary from case to case. As already indicated, orders in the nature of stays are frequently made because of this Court's recognition of the arguability of an appeal in the High Court, if that Court were to grant special leave."

25 Although their Honours did not state that a stay would usually be granted, it again appears that a less stringent test was applied than that suggested by Brennan J in Burgundy Royale .

26 A somewhat different approach was taken by Spigelman CJ in Minister for Local Government v South Sydney City Council (No 3) [2002] NSWCA 327. His Honour, after referring to Burgundy Royale, made the following remarks:

"[10] The principles applicable to the grant of a stay and of an injunction substantially overlap. The authority for the former most frequently referred to is the judgment of Brennan J, as his Honour then was, in Jennings Construction Ltd v Burgundy Royale Investments Pty Ltd (No 1) (1986) 161 CLR 681, particularly at 684-685. In the case of an injunction, the authority that is most frequently referred to is the judgment of Mason CJ in Smith Kline & French Laboratories (Aust) Ltd v Secretary, Department of Community Services and Health (1991) 65 ALJR 360, especially at 361.

[11] These cases are also authority for the proposition that an intermediate court of appeal should not be diffident in granting a stay or an injunction, in an appropriate case, notwithstanding the difficulty that may sometimes be occasioned for a member of an intermediate court of appeal in making an assessment of the prospects of a grant of special leave in a particular case.

[12] It appears on the authorities that there are a number of elements that often arise in these matters. It is always material to look at the prospects of success, relevantly in this case, the prospects of a grant of special leave. It is also always material to look at the probability that a successful appeal would not make any practical difference to the rights and interests of the appellant unless a stay or injunction was granted."

27 His Honour granted a stay notwithstanding the view he expressed (at [25]) that the prospects of obtaining special leave to appeal were weak.

28 Although the Chief Justice referred to the passage from Burgundy Royale, which we have cited above, it is not, with respect, entirely clear whether he was following the approach taken by the High Court that a stay should be granted only in exceptional circumstances or the less stringent approach adopted in the earlier Court of Appeal decisions.

29 The difference in approach was expressly recognised by Giles JA in White v State Bank of NSW [2002] NSWCA 408. His Honour summarised the position as follows (at [6]):

"The approach of the Court of Appeal has not, it seems to me, as yet adopted the stringency which has become evident in recent time in the High Court's own decisions on stay applications pending applications for special leave to appeal. The approach of the Court of Appeal is found in John Fairfax and Sons Ltd v Kelly (No 2) (1987) 8 NSWLR 51 and Sibuse Pty Ltd v Shaw (No 2) (1988) 13 NSWLR 125. I am sitting as a single judge exercising the powers of the Court of Appeal, and in those circumstances I think that where the High Court has itself recognised its approach is somewhat more stringent than that of the Court of Appeal (see Kirby J in Bryant v Commonwealth Bank of Australia ), but has not indicated that its approach should be taken by the Court of Appeal, I should follow the approach in the cases last-mentioned."

The divergence in approach was also recognised by McColl JA in Miller v Nationwide News Pty Ltd [2008] NSWCA 261 at [22]-[25]. Her Honour pointed out that there were two decisions of three judges of the Court of Appeal which adopted a less stringent approach; Kelly and Sibuse (No 2). Her Honour also noted that Spigelman CJ had not been referred to these authorities in Minister for Local Government v South Sydney City Council (No 3) supra.

30 More recently in Adeels Palace Pty Ltd v Moubarak [2009] NSWCA 130, Hodgson JA citing both Burgundy Royale and Kelly expressed the view that what was required was a reasonable basis for the application which was not a high threshold (at [3]). Similarly, Basten JA in International Litigation Partners Pte Ltd v Chameleon Mining NL [2011] NSWCA 186 said (at [16]) that the Court is required to do no more than assess whether there is a reasonable prospect of success on the special leave application.

The position in other states

31 In Victoria the Court of Appeal has adopted the approach laid down in Burgundy Royale.

32 In Australian Football League v Carlton Football Club (Court of Appeal, 1 August 1997, unreported), Tadgell JA citing Sibuse (No 2) stated that the jurisdiction to grant a stay can only be exercised when a stay is appropriate. However, his Honour went on to say that whilst the preservation of the subject matter of the litigation was a relevant consideration, it was also relevant to consider whether there was a substantial prospect that any application for special leave would be granted. Hayne JA agreed with these reasons. In Walter v National Australia Bank [2004] VSCA 184, Eames JA, with whom Buchanan JA agreed, stated that for the application in that case to succeed it was necessary to show exceptional circumstances. His Honour cited Burgundy Royale in support of that proposition (at [16]).

33 In Palmer v Permanent Custodians Ltd [2009] VSCA 164, Dodds-Streeton JA with whom Beech AJA agreed, reviewed both Burgundy Royale and the New South Wales authorities and reached the following conclusion (at [56]):

"Although some states have modified the traditional test applicable to a stay, this court's jurisdiction to grant a stay in a conventional case, whether pursuant to the rules or its inherent jurisdiction, is still characteristically invoked by special or exceptional circumstances, which encompass the likelihood that the appeal will otherwise be registered nugatory. Such principles generally accord with Brennan J's description of the jurisdiction identified in Jennings ."

34 In South Australia the Full Court of the Supreme Court in Politarhis v Westpac Banking Corp (No 2) [2009] SASC 109 citing Burgundy Royale and Gerah Imports supra, stated that the matters relevant to considering whether to grant a stay were whether there was a substantial or realistic prospect that special leave would be granted, whether the stay would cause loss to the respondent and, third, the balance of convenience (at [14]). Earlier, in Duke Group Ltd (in liq) v Pilmer [1999] SASC 373, Doyle CJ on hearing an application for a stay pending an application for special leave to appeal to the High Court from the decision of the Full Court, expressed the view that, pending a considered determination by an intermediate court of appeal, he should adopt the approach in Burgundy Royale rather than the less stringent approach in Kelly (see Duke Group at [8]-[15]).

35 A similar approach has been adopted in Western Australia. In Hamersley Iron Pty Ltd v Lovell (No 2) (1998) 20 WAR 79, Ipp J, after considering Burgundy Royale , other High Court authorities and the decision of the New South Wales Court of Appeal in Kelly, concluded that the stringent approach adopted by the High Court should be adopted by the Full Court of Western Australia (see Hamersley at 82 and 87). Anderson J reached a similar conclusion (at 89 and 93). The third member of the Court, Pidgeon J, agreed with each of the reasons of Ipp and Anderson JJ.

36 In Denning v Jet Development Pty Ltd [2007] QCA 63, Williams JA, with whom Keane JA agreed, stated the appropriate test was to be found in Burgundy Royale . A similar conclusion has been reached in Tasmania and the Northern Territory (see Gunns Limited v Alishab (No 3) [2009] TASSC 103 at [10] and Territory Insurance Office v Costa [2002] NTCA 1; (2002) 11 NTLR 212 at [35]).

The approach which should be adopted in this Court

37 Having regard to the submissions of the parties, it is appropriate for this Court to consider whether the approach suggested in Kelly should continue to be applied or whether the more stringent approach applied in the High Court should be adopted.

38 The circumstances in which this Court should depart from its earlier decisions were extensively reviewed in Gett v Tabet [2009] NSWCA 76; (2009) 254 ALR 504. Generally speaking, this Court will only overrule one of its earlier decisions if it is satisfied the decision is plainly wrong or clearly wrong in the sense referred to in Gett v Tabet at [294] and after consideration of the other matters referred to in paras [295]-[301] of that judgment. Further, although the normal course is to convene a five-judge bench to consider whether an earlier decision of the Court should be overturned, this was not practical in this case due to the urgency of the application. In any event, although it has not been finally decided, there is a question whether a different test would be applied had the matter been decided by a bench of five judges as opposed to three; Jemena Gas Networks (NSW) Ltd v Mine Subsidence Board [2010] NSWCA 146, [47]-[56].

39 There are two additional considerations in the present case which did not arise in Gett v Tabet . First, the Court of Appeal in Kelly was not stating a principle of law but rather laying down a practice to be followed in respect of a particular type of application made before the Court. It seems to us that the requirement that the earlier decision be plainly wrong does not assume the same importance when the Court is considering altering a practice previously adopted by it as distinct from a decision on a particular question of law.

40 Second, as was pointed out in Gett v Tabet at [279], consideration of the question arises in the context that the powers of the Court derive from the appellate structure contained in Chapter III of the Constitution. The fact that the courts in each of the other states of the Commonwealth have adopted a different approach to that set out in Kelly provides, in our opinion, a basis for its reconsideration.

41 In our opinion, the approach in Kelly should no longer be followed by this Court in considering applications for stays pending applications for special leave to appeal to the High Court, but rather the approach of Brennan J in Burgundy Royale should be adopted. Further, to the extent that Sibuse (No 2) adopts a different approach to Burgundy Royale , it should no longer be followed. We have reached this conclusion for a number of reasons.

42 First, there is no logical reason why the approach to the grant of a stay should be different depending on the court to which the application is made. Brennan J did not suggest in Burgundy Royale that a different approach to that set out by him should be adopted by state courts. It seems to us in these circumstances this Court should follow the approach of the High Court.

43 Second, the approach in Kelly fails, with respect, to recognise that the jurisdiction to grant a stay is an extraordinary one to be exercised in only exceptional circumstances.

44 Third, the reasons supporting a less stringent approach, in our opinion, are unconvincing. There should be no embarrassment in exercising a jurisdiction which the High Court has held this Court should exercise. Whilst there will be difficulty in some cases in making an assessment as to whether a case has substantial prospects of obtaining special leave, the criteria are set out in s 35A of the Judiciary Act 1903 (Cth). This Court has now been able to observe the approach taken by the High Court to such applications for a period of almost 30 years. Further, it does not seem to us that the adoption of a more stringent test would lead to a flurry of applications for stays to the High Court, as suggested by counsel for the second applicant. There is nothing to suggest that this has occurred in other states where the more stringent test is applied.

45 Fourth, it is by no means clear that the approach adopted by judges of this Court subsequent to Kelly reveals an approach usually to grant a stay unless, for example, the application appears plainly hopeless. The authorities to which we have referred show that the Court, generally speaking, has adopted a less liberal test, albeit one less stringent than that referred to in Burgundy Royale .

46 Fifth, in matters of this nature, consistent with what was said by the High Court in Australian Securities Commission v Marlborough Gold Minds Ltd [1993] HCA 15; (1993) 177 CLR 485 at 492 and Farah Constructions Pty Ltd v Say-dee Pty Ltd [2007] HCA 22; (2007) 230 CLR 89 at [135] this Court should not depart from decisions of other intermediate courts of appeal unless convinced they are plainly wrong. Although the situation is unusual in the present case as the earliest decision of an intermediate court of appeal is Kelly , it seems to us that the Court should follow the approach adopted by all other intermediate courts and the High Court on this issue, particularly having regard to the matters which we have referred to in paras [42] to [45] above.

47 In these circumstances, this Court should, in our opinion, adopt the approach laid down by Brennan J in Burgundy Royale in considering applications for stays of this nature.

48 We do not, however, agree with the respondents that in all cases it is an essential prerequisite for the grant of a stay that the Court finds that there are substantial prospects of success on the special leave application. There may be cases, albeit rare, when the other factors material to the grant of a stay may be of such significance that a stay should be granted even if this Court is unable to reach the view that the application has substantial prospects of success. That does not seem to us inconsistent in any way with what Brennan J said in Burgundy Royale or his subsequent decision in Edelsten v Ward supra.

Should a stay be granted in the present case?

49 In considering whether or not the application for special leave has substantial prospects of success, one difficulty with which we are confronted is that whilst we have the applications for special leave filed by each applicant, we do not have any summary of argument in the case of the first applicant and in the case of the second applicant, a summary which was expressed to be only a draft. However, we have considered each of the special leave applications and the draft summary of argument and have reached the view that the applicants do not have substantial prospects of obtaining special leave to appeal.

50 In Hogan v Australian Crime Commission [2010] HCA 21; (2010) 240 CLR 651 (" Hogan ") the High Court considered s 50 of the Federal Court of Australia Act 1976 (Cth) which relevantly is in the same terms as s 8(1)(a) of the Court Suppression and Non-publication Orders Act 2010 (" Suppression Act "). Senior counsel for the first applicant was unable to point to any material differences between s 8(1)(a) of the Suppression Act and s 50 of the Federal Court of Australia Act except to say that the provisions of the Suppression Act were influenced by the terms of the Commercial Arbitration Act 2010 (" Arbitration Act ", as to which, see below). Apart from saying the facts were different, counsel was also unable to point to any inconsistency between the approach of this Court in the review judgment and the decision of the High Court in Hogan . The written submissions of the first applicant in this case do not identify any inconsistency.

51 Although a number of grounds of appeal are raised in the application for special leave filed by the first applicant, none of these were developed either orally or in writing. To some extent they were covered by the submissions of the second applicant and are dealt with below. However, to the extent that no argument in support of these grounds was proffered by either the first or the second applicant we are unable to conclude that the application has substantial prospects of success to the extent that such grounds are relied upon.

52 The second applicant contended that there were material differences between s 8(1)(a) of the Suppression Act and s 50 of the Federal Court of Australia Act by reason of the provisions of s 6 of the Suppression Act . Section 6 provides that: "[i]n deciding whether to make a suppression order or non-publication order, a court must take into account that a primary objective of the administration of justice is to safeguard the public interest in open justice." It was by no means made clear in the oral submissions of senior counsel for the second applicant why s 6 meant there was a material difference in the legislation having regard to the provisions of s 17 of the Federal Court of Australia Act, which requires the jurisdiction of the Federal Court generally to be exercised in open court. The provisions of s 6 of the Suppression Act do not, in our view, affect the fact that the jurisdiction in s 8(1)(a) of that Act can only be enlivened if it is necessary for the administration of justice in the sense described in Hogan at [30]. That was the test adopted by this Court in the review judgment.

53 Senior counsel for the second applicant also suggested that the Court had failed to recognise that the judgment of Tobias AJA ( Rinehart v Welker [2011] NSWCA 345) was a discretionary judgment reviewable presumably only in accordance with the principles set out in House v The King (1936) 55 CLR 499. This submission is inconsistent with what was said in Hogan at [33] as to the evaluative process to be conducted in considering whether or not a suppression order is necessary to prevent prejudice to the proper administration of justice.

54 The fact that these issues have been considered recently by the High Court in Hogan provides a substantial barrier to the applicants' prospects of success in obtaining special leave.

55 The draft summary of argument in support of the application for special leave prepared on behalf of the second applicant contends that the reasons of the plurality in the review judgment wrongly confine the power to make a suppression order under s 8(1)(a) to established exceptions to the open justice principle at common law. This was said to be the effect of paras [32]-[38]. However, these paragraphs were expressed to be by way of reinforcement of para [31], which, consistently with Hogan at [31] and [38] stated that it was an insufficient basis to make an order that it would be commercially reasonable or sensible or serve some notion of the public interest or because the material was inherently confidential. Further, apart from asserting the contractual entitlement contained in clause 20.8 of the Deed between the parties referred to above, no other exception to the common law principles of open justice was identified in the proceedings the subject of the review judgment.

56 It follows, in our opinion, that the applicants do not have substantial prospects of success on this ground.

57 The second applicant further argued in the draft submissions in support of the application for special leave that the plurality erred in the review judgment in failing to make a suppression order in circumstances where failure to do so would render "the appeal nugatory or seriously damage[...] the utility of the appellate process". The draft summary of argument stated that the case fell within the exception to the open justice principle contained in Australian Broadcasting Commission v Parish (1980) 43 FLR 129 and approved by the High Court in Hogan at [42]-[43]. However, contrary to the position in Parish, there was no evidence in the present case that the information the subject of the suppression order had any intrinsic value which would be destroyed by its publication or that its publication would cause financial harm to any person. Mere embarrassing publicity is not enough; see Hogan at [43].

58 It follows we are of the view that there is no substantial prospects of obtaining special leave on this ground.

59 There remains the argument of the second applicant based on the provisions of the Arbitration Act . As the argument was developed orally it appeared to rely on the following propositions. First, having regard to the provisions of the Arbitration Act the plurality erred at [43]-[44] of the review judgment in stating, consistent with the view expressed by Mason CJ in Esso Australia Resources Ltd v Plowman (Minister for Energy and Minerals) [1995] HCA 19; (1995) 183 CLR 10 that confidentiality was not an essential character of a private arbitration, that privacy is not synonymous with confidentiality. It was said that these reasons ignored the provisions of the Arbitration Act , which, it was submitted, by s 8 required the courts to stay proceedings the subject of an arbitration agreement, and s 27E, which prohibited the disclosure of confidential information in relation to arbitral proceedings unless allowed under s 27F, s 27G, s 27I and not prohibited by an order made under s 27H. The second proposition was that the Court in the review judgment failed to take the provisions of the Arbitration Act into account in setting aside the suppression orders made by Tobias AJA.

60 Two other sections of the Arbitration Act should be noted. First, the effect of s 1(2) is that the confidentiality provisions only apply if the place of arbitration is in New South Wales. Second, confidential information is defined in s 2(1) of the Arbitration Act in the following terms:

" Confidential information, in relation to arbitral proceedings, means information that relates to the arbitral proceedings or to an award made in those proceedings and includes the following:

(a) the statement of claim, statement of defence and all other pleadings, submissions, statements or other information supplied to the arbitral tribunal by a party,

(b) any information supplied by a party to another party in compliance with a direction of the arbitral tribunal,

(c) any evidence (whether documentary or otherwise) supplied to the arbitral tribunal,

(d) any notes made by the arbitral tribunal of oral evidence or submissions given before the arbitral tribunal,

(e) any transcript of any oral evidence or submissions given before the arbitral tribunal,

(f) any rulings of the arbitral tribunal,

(g) any award of the arbitral tribunal."

61 It seems to us that the applicants will face significant difficulty in obtaining special leave on this point. First, the argument was not raised before Tobias AJA or the Court of Appeal which heard the review application. Indeed, the argument was first made by the second applicant in her submissions in reply.

62 Further, it is by no means clear that the provisions of the Arbitration Act could apply in any event. At the very least there are a number of issues relevant to this question which have not been determined by Brereton J, Tobias AJA or this Court on the review application. These may be summarised as follows:

(a) Whether the arbitration is a domestic arbitration. There is no evidence that all parties to the Deed have a place of business in Australia or have a place of business at all. If any of the parties do not and their habitual residence is outside Australia, then the Arbitration Act will not apply (see s 1(1), s 1(3) and s 1(4)(b) of the Arbitration Act ).

(b) The Arbitration Act only applies if the place of arbitration is New South Wales. Clause 20.2(c) of the Deed containing the arbitration provisions provides that absent agreement between the parties the arbitration shall take place in Western Australia. There is no evidence of any agreement to the contrary.

(c) Whether arbitral proceedings are in fact on foot and the confidentiality provisions apply. This depends upon whether the letter of 4 October 2011 commenced arbitral proceedings for the purpose of s 21 of the Arbitration Act .

(d) Aligned to the third issue is the question of whether a pleading filed before the 4 October 2011 letter could, in any event, constitute confidential information in relation to the arbitration proceedings.

63 There are further difficulties with the submission. It was by no means clear why the provisions of the Arbitration Act relied upon would lead to the conclusion that there was prejudice to the administration of justice if a suppression order was not made. It should be noted that no reliance has been placed on s 8(1)(e) of the Suppression Act which provides that a court may make such an order where it is necessary in the public interests for the order to be made and that public interest significantly outweighs the public interest in open justice.

64 Next we would point out that the reference in the review judgment (at [42]) to s 1C of the Arbitration Act and the discussion which followed was to explain (see [45], [47], [51]) that even respecting the "party autonomy" reflected in the right to select private arbitration is not determinative as to whether supervisory proceedings should be heard in open court.

65 Finally, the reference to Esso Australia Ltd v Plowman contained in paras [42]-[43] of the review judgment of the plurality was to explain the necessity for the insertion of clause 20.8 into the Deed. The fact that such a provision may not be necessary in the case of a domestic commercial arbitration in New South Wales does not, in our opinion, demonstrate any error in the conclusion reached at [45] of the review judgment.

66 For these reasons we do not believe that the issues raised in the Arbitration Act lead to the conclusion there is a significant prospect of the applicants obtaining special leave.

67 There were two other matters, which can be disposed of shortly. First, reliance was placed on the fact that Tobias AJA reached a different conclusion to the Court of Appeal in the review judgment. That does not seem to us to be of particular significance as Tobias AJA was not referred to the principal authorities on the issue, in particular, Hogan .

68 It was also suggested that as the legislation was new and potential model legislation there was a significant prospect of obtaining leave. It is by no means clear why this is the case. Leave is more likely to be granted if significant problems or divergence of views emerge on the question of construction of the Suppression Act and any like legislation which may be but has not yet been introduced. Further, in the present case, the only section of the Suppression Act in issue was s 8(1)(a). As we have pointed out, the equivalent provision in the Federal Court of Australia Act has recently been considered by the High Court.

69 For these reasons we regard the prospects of obtaining special leave as insubstantial and not such as to warrant a stay.

70 It is true that a refusal to grant a stay may lead to any application for special leave being rendered nugatory. However, having regard to our view as to the prospects of success of such an application this does not warrant a stay. Quite apart from our view as to the prospects of success, there is no right to a suppression order as such. Further, the applicants will still be entitled to a private arbitration if they are successful in overturning the decision of Brereton J. There is no evidence that publication of the matters the subject of the suppression order would expose either of the applicants to any financial loss, although we accept (as did the review judgment at [54]) that the disclosure of the information may be embarrassing to Ms Gina Rinehart.

71 For these reasons we reach the conclusion no stay should be granted. However, having regard to the nature of the issues raised and the fact that the matter was heard in vacation when some of the parties' primary legal representatives were unavailable, we took the view that it was appropriate to order a short stay to enable the parties to consider this judgment.

Decision last updated: 20 January 2012