PNG Pipes Pty Limited and Venugopal v Sefa, Globes Pty Limited and Macasaet [1998] PGSC 52; SC592 (26 November 1998)

Unreported Supreme Court Decisions

SC592

PAPUA NEW GUINEA

[SUPREME COURT OF JUSTICE]

SCA 56 OF 1996
BETWEEN: PNG PIPES PTY LIMITED & SANKARAN VENUGOPAL
APPELLANTS
AND: MUJO SEFA
FIRST RESPONDENT
GLOBES PTY LIMITED
SECOND RESPONDENT
ROMY MACASAET
THIRD RESPONDENT

Waigani

Amet CJ Kapi DCJ Los J
23 May 1997
26 October 1998
26 November 1998

COURTS AND JUDGES – Judges – Refusal to disqualify himself – Apprehension of bias.

BIAS – Reasonable apprehension – Test for – Apprehension of real likelihood of – Not fanciful – Refusal to disqualify

Held:

(1) The test applied in determining whether apprehension of bias was satisfied was whether an objective observer, knowing all surrounding facts, would be left with an apprehension, not a conviction, that the judicial officer was predisposed, by matters extraneous to a proper adjudication, to reach a particular conclusion.

(2) The refusal by the trial judge, in the particular circumstances of this case, to disqualify himself would have left an objective observer with an apprehension of the real likelihood of bias.

(3) The trial judge should therefore be disqualified from further presiding over this matter.

Cases Cited

Trustees of Christian Brothers v Cardone [1995] FCA 1309; 130 ALR 345.

Metropolitan Properties Co (FGC) Ltd v Lannon [1968] EWCA Civ 5; (1969) 1 QB 577.

R v Liverpool City Justices, Ex parte Topping (1983) 1 WLR 119

Boateng v The State [1990] PNGLR 342

Counsel

J Bray, for the Appellant.

G Sheppard, for the Respondent.

25 November 1998

AMET CJ KAPI DCJ LOS J: This is an appeal from a ruling by the learned trial judge in the National Court, wherein His Honour refused an application upon motion that he disqualify himself from further hearing the trial matter then before him.

The application before the learned judge pleaded the issue in these terms:

“That a fair minded lay observer with knowledge of the material objective facts might entertain a reasonable apprehension that the judge might not bring an impartial and unprejudiced mind to the resolution of the question in issue.”

The application was supported by the affirmation of Mr Sankaran Venugopal. The learned judge dismissed the application, giving an oral judgment to the effect that the test for disqualification for bias had not been satisfied.

FACTS

The Appellants are, together with one other, defending a statement of claim, which alleges breaches of fiduciary duties. The pertinent factual matters and circumstances that the Appellants relied upon as affirmed in Mr Venugopal’s affirmation are as follows:

1. On the 31 October 1995 the learned judge granted ex parte orders in the nature of Mareva injunctions and Anton Pillar orders.

2. The Anton Pillar orders resulted in the plaintiffs personally as opposed to their lawyers gaining control of all the documents of PNG Pipes Pty Ltd, with no supervision at all.

3. The Anton Pillar order was never executed and this fact was brought to the attention of the learned judge on 2 April 1996.

4. The Appellants sought Discovery by the Respondents on the 3 April 1996. The Respondents failed to give discovery.

5. On 3 May 1996 the Appellants obtained an order from the court that the Respondents give discovery within 14 days.

6. The Respondents again failed to give discovery, within the extended 14 days.

7. On 24 May 1996 the Appellants applied for orders that the Respondents claim be struck out for failing to give discovery within the extended time. The learned judge was fully cognisant of the Respondents failure to give discovery.

8. Notwithstanding this failure the learned judge has done nothing to remedy that situation.

9. The continuing failure to give discovery has prejudiced the Appellants in their application to discharge and vary certain orders, especially those ex parte orders of 31 October 1995, as the Appellants were cross-examined using documents which should have been discovered.

10. The Appellants commenced contempt proceedings against the Respondents for failure to allow inspection of the day to day documents of PNG Pipes, by the Appellant, pursuant to order 5 of 1^st March 1996.

11. The learned judge declined to hear those proceedings.

12. On 2^nd February 1996 the learned judge made certain orders, one of which included a supervision order in the following terms:

“That Mr. P. Payne or a nominee of his be appointed to oversee PNG Pipes Pty Ltd (the company) accounts, i.e. withdrawals and deposits.”

13. The supervision order was never effected. Mr. Payne a lawyer with Blake Dawson Waldron made it plain that he could not supervise the affairs of PNG Pipes, and this matter was brought to the attention of the learned judge.

14. The supervision order was repeated in the orders of 25 March 1995.

15. On 30 April 1996 the court made protection orders in favour of the Second Appellant.

16. On 9 July 1996 the Respondent arbitrarily cancelled the orders.

17. Contempt proceedings were brought before the learned judge, but he declined to deal with the application. He reinstated the initial orders.

18. The Appellants again fixed another day for the inspection of the day to day documents of the operations of PNG Pipes, for Friday 23 August 1996 at 1.30 PM. The Respondents again refused this.

19. Contempt proceedings were again brought, but again the learned judge declined to hear it. Instead the learned judge directed that the Respondents give access on Friday the 30 August at 3.00 PM.

20. Inspection did not take place as ordered by the court.

21. The learned judge has consistently refused to reply to the Appellants’ lawyer’s requests to hear the submissions in respect of having the orders discharged.

22. The learned judge has failed to react to the lack of supervision of the PNG Pipes bank accounts and day to day operations.

23. On several occasions when the lawyer for Appellants had requested the learned judge to clarify Order 1 of the orders of 25 March, 1996, in relation to the meaning of “day to day control of the administration and management” of PNG Pipes by the first Respondent, the learned judge has declined to clarify the orders.

It is useful and instructive to refer to similar cases and statements of principles in overseas jurisdiction, which may be of assistance. The first such case referred to and relied upon by the Appellant as persuasive authority is an Australian Federal Court case of Trustees of Christian Brothers v. Cardone [1995] FCA 1309; 130 ALR 345.

The respondent was a student at a school owned and operated by the appellants and was injured whilst at the school. The respondent sued the appellants for damages for negligence. The trial judge was a former pupil of the school and was chairman of the school board. It also transpired that he knew three of the appellants’ witnesses, one of whom was also on the school board. At the commencement of the hearing the appellants made an application for the trial judge to disqualify himself from hearing the case on the ground of apprehended bias. The trial judge declined to disqualify himself and said that the appellants’ solicitors knew of his association with the appellants when the matter had first been listed for hearing, but had made no objection.

The Full Court in dismissing the appeal on the issue of disqualification for apprehended bias said:

“The apprehension of bias must be reasonably and not fancifully entertained. The appellate court must be satisfied, upon examination of the surrounding facts, that an objective observer would be left with an apprehension, not a conviction, that the judicial officer was predisposed, by matters extraneous to a proper adjudication, to reach a particular conclusion”.

Gallop J, in dissent outlined some useful principles from the Australian High Court and other cases to be applied in cases of imputed judicial bias. He said:

“On the one hand there are the repeated assertions of the courts that:

(a) Judges by their training and experience are able to bring a detached mind to the task: R v. Leckie; Ex parte Felman (1977) 18 ALR 93; 52 ALJR 155 at 160;

(b) Judges should not too readily accede to applications for disqualification whereby parties may effectively influence the choice of a judge in their cause: Re JRL; Ex parte CJL [1986] HCA 39; (1986) 161 CLR 342 at 352; [1986] HCA 39; 66 ALR 239

(c) Judges should resist being driven from their courts by the conduct or assertion of parties.

(d) Judges should not be disqualified because of the vigour with which they conduct proceeding.

(e) Judges should perform the duties of their office, which, of their nature, will often be painful and unrewarding. They should do so with courage and decisiveness, avoiding the relinquishment of such duties which will necessarily then fall to another judicial officer for whom the task may be no more congenial: Raybos Australia Pty Ltd v. Tectran Corp Pty Ltd (No 9) (unreported).

On the other hand, a series of recent decisions of the High Court has stressed the very high standards of manifest neutrality and impartiality established by that court for observance by every judicial officer in the courts of Australia.

The test as formulated by the High Court in determining whether a judicial officer (a judge) is disqualified by reason of the appearance of bias as distinct from proved actual bias is whether in all the circumstances a fair minded, lay observer with knowledge of the material objective facts “might entertain a reasonable apprehension that [the judge] might not bring an impartial and unprejudiced mind to the resolution of the question” in issue. Livesey v. New South Wales Bar Association, supra, at CLR 293-4.”

In the Court of Appeal of the Supreme Court of the Northern Territory in Limbo v. Little (1989) 65 NTR 19, Martin J said at 27:

“Judges are capable of putting aside personal predilections arising from life’s experiences. We all, I suspect, have views, opinions and attitudes moulded by a variety of factors. Rigorous training in the discipline of the law and in particular the requirement of objectivity, together with public insistence upon judicial integrity, mean that unless some material matter is raised by a litigant, or voluntarily disclosed by the judge, it is accepted that there can be no suggestion of reasonable apprehension of bias. Edmund Burke spoke of “ the cold neutrality of an impartial judge.” That is what is expected. If impartiality is lacking, or could be fairly thought to be lacking, it may well become evident sooner or later, but it is not for the litigant to pry into the judges background,”

Lord Denning MR said in Metropolitan Properties Co (FGC) Ltd v. Lannon [1968] EWCA Civ 5; [1969] 1 QB 577 at 598:

So far as bias is concerned, it was acknowledged that there was no actual bias on the part of Mr. Lannon, and no want of good faith. But it was said that there was, albeit unconscious, a real likelihood of bias. This is a matter on which the law is not altogether clear: but I start with the oft- repeated saying of Lord Hewart CJ in R v. Sussex Justices; Ex parte McCarthy [1923] EWHC KB 1; [1924] 1 KB 256 at 259: “It is not merely of some importance, but is of fundamental importance that justice should not only be done, but should manifestly and undoubtedly be seen to be done.”

...

It brings home this point: in considering whether there was a real likelihood of bias, the court does not look at the mind of the justice himself or at the mind of the chairman of the tribunal, or whoever it may be, who sits in a judicial capacity. It does not look to see if there was a real likelihood that he would, or did, in fact favour one side at the expense of the other. The court looks at the impression which would be given to other people. Even if he was as impartial as could be, nevertheless if right- minded persons would think that, in the circumstances, there was a real likelihood of bias on his part, then he should not sit. And if he does sit, his decision cannot stand:

Nevertheless there must appear to be real likelihood of bias. Surmise or conjecture is not enough:

There must be circumstances from which a reasonable man would think it likely or probable that the justice, or chairman, as the case may be, would, or did, favour one side unfairly. Suffice it that reasonable people might think he did. The reason is plain enough. Justice must be rooted in confidence: and confidence is destroyed when right-minded people go away thinking: “The judge was bias.”

It was submitted in this appeal that the veracity of these facts and circumstances relied upon by the Appellant were not disputed by the Respondents. It was submitted that these must in their accumulative effect give rise to “a reasonable apprehension that the judge might not bring an impartial and unprejudiced mind to the resolution of the questions in issue.”

The most recent authoritative statement by this Court, on the issue of apprehension of bias was in Boateng v. The State [1990] PNGLR 342, where the Court adopted as the test what was stated in R v. Liverpool City Justices; Ex parte Topping [1983] 1 WLR 119, which is in the following term:

“Would a ‘reasonable and fair-minded person sitting in a court and’ knowing all the relevant facts have a ‘reasonable suspicion that a fair trial for’ the appellant ‘was not possible’?”

It is therefore open to the parties as well as to a member of the public, to entertain the reasonable apprehension, in the light of all the circumstances, including statements made at the time when the judicial officer refuses to disqualify him or herself. The suspicion or apprehension must be reasonable and not fanciful.

In considering whether there was a real likelihood of bias, the court does not look at the mind of the justice himself or at the mind of the chairman of the tribunal, or whoever it may be, who sits in a judicial capacity. It does not look to see if there was a real likelihood that he would, or did, in fact favour one side at the expense of the other. The court looks at the impression which would be given to other people. Even if he was as impartial as could be, nevertheless if right-minded persons would think that, in the circumstances, there was a real likelihood of bias on his part, then he should not sit. And if he does sit, his decision cannot stand.

The reason is plain enough. Justice must be rooted in confidence: and confidence is destroyed when right-minded people go away thinking: “The judge was biased.”

Before an appellate court can be persuaded that a reasonable apprehension of bias has been “firmly established” as required by the authorities, it must be satisfied, upon an examination of the surrounding facts, that an objective observer would be left with an apprehension, not a conviction, that the judicial officer was predisposed, by matters extraneous to a proper adjudication, to reach a particular conclusion.

Applying these principles to the affirmed facts of this case, “would a reasonable and fair-minded person sitting in court and knowing all the relevant facts have a reasonable suspicion that a fair trial for the appellant was not possible?”

We believe that such an objective observer would be left with an apprehension that there was a real likelihood of bias.

We are of the opinion therefore that for all the proper principles referred to above and which we consider to be relevant and applicable to the circumstances of Papua New Guinea for adoption, we would uphold the appeal and declare that the learned trial judge be disqualified from continuing to preside over this matter and that the matter be assigned to another judge.

The appeal is upheld with costs.

Lawyer for the Applicants: Pato Lawyers.

Lawyer for the Respondents: Maladinas Lawyers.