Media

Litigation costs make it a lottery

Courier Mail - Edition Issue 1, 29 May 2006
By Michael Madigan

AT more than $5000 a day, litigation is becoming far too expensive for the ordinary Australian, according to a High Court Judge.

Justice Ian Callinan has highlighted the performance of his own court to suggest the law can be expensive ``lottery''. And he has suggested it might be time for the states to start subsidising mediation and dispute resolution to unclog the courts.

`User-pays is a concept alien to democratic justice,'' Justice Callinan said. Speaking at an Institute of Arbitrators and Mediators conference in Cairns, Justice Callinan also said there should be more emphasis on using mediation rather than litigation to resolve disputes.

`(Litigation) imposes not only financial but also emotional and sometimes even physical costs,'' he said.``It can affect families, local communities industries and countries.''

The costs to enter the court room were now extremely high, he said. The setting-down fee in the Federal Court for a corporation was $2422, and $1211 for an individual.Hearing fees were usually $969 a day for corporations and $483 a day for individuals.

`While I readily accept that that amount would not cover -- perhaps not nearly cover -- the actual costs to the public purse, its imposition represents a highly undesirable trend,'' he said.

But Justice Callinan, whose court is considering a challenge to the Federal Government's new industrial laws, also warned of power imbalances in workplace contracts that might best be resolved in courts rather than in mediation.

He said those looking towards new dispute resolution processes needed to be wary of power imbalances, especially in the workplace. Wall Street investment houses in New York were alleged to have used employment contract arbitration clauses oppressively against employees in the late 1990s.

Employees were supposedly forced to have their complaints heard before an arbitrator chosen by, and sympathetic to, the employer. Justice Callinan said he did not know if the allegations were true.

`But it may be said, I think, that where there are significant power imbalances between parties to a dispute there may be, if not invariably so, protection in courts of law that are not to be found in alternative dispute resolution,'' he said.

Justice Callinan said the attractions of alternative dispute resolution were bound to become better known by the public.

The privacy it allowed, and the ability to choose your own mediator were attractive, he said.

The only threat to alternative dispute resolution was duplication of costs should it fail and have to go to the courts anyway. Justice Callinan said the remedy to that was state subsidisation of the process.

`I would need to be far less experienced in public affairs, and much more of an optimist than I am, to believe . . . that is likely to come to pass,'' he said.

We gratefully acknowledge the permission from Michael Madigan and the Courier Mail to reprint this article.