Bills To Merge The Federal Circuit Court And The Family Court Introduced Into Parliament

In a media release dated 17 August 2018, the Attorney General, Christian Porter, announced that legislation to reform the federal courts dealing with family law matters would shortly be introduced into Federal Parliament. That legislation was introduced into the House of Representatives on 23 August 2018 as the Federal Circuit and Family Court of Australia Bill 2018 (Cth) (the main Bill) by Ms O’Dwyer, at the time the Minister for Revenue and Financial Services, for the Attorney General. Accompanying the main Bill is the Federal Circuit and Family Court of Australia (Consequential Amendments and Transitional Provisions) Bill 2018 (Cth) (the accompanying Bill) which makes the consequential amendments and transitional provisions necessary to support the main Bill.  

In the earlier media release the Attorney General released the PwC report known as the "Review of efficiency of the operation of the federal courts", which was commissioned by the Government when the plan to merge the Federal Circuit and Family Court of Australia (FCFCA) was announced. The report was commissioned to analyse in detail the extensive data available on the operations of the Family Court of Australia and the Federal Circuit Court in relation to family law matters. 

Nature of the Proposed Merger

The main Bill and the accompanying Bill would bring the Federal Circuit Court of Australia (the Federal Circuit Court) and the Family Court of Australia (the Family Court) together into an overarching, unified administrative structure to be known as the Federal Circuit and Family Court of Australia (the "FCFCA"). According to the Attorney-General, the structural reforms facilitated by the two Bills would create a framework for common leadership, common management and a comprehensive and consistent internal case management approach. To further ensure that these objects are met, the main Bill provides for the making of regulations and, in particular, Rules of Court which govern the details, operations and practice and procedure of the FCFCA. This statutory framework in its entirety would underpin the court forms, practice notes, directions and a consistent case management pathway for family law matters.

The new FCFCA will be divided into two divisions. Division 1 will comprise the existing judges of the Family Court, and will deal only with family law matters and Division 2 will comprise the existing judges of the Federal Circuit Court, and will deal with both family law and general federal law matters. The Federal Circuit Court’s existing general federal law jurisdiction and fair work jurisdiction will not be impacted by the establishment of the FCFCA, with no changes to the existing appeal pathway. The current Fair Work Division of the Federal Circuit Court will be retained in Division 2 of the FCFCA. Under the proposed structural changes there is to be no changes to jurisdiction or operation of the High Court of Australia, the Family Court of Western Australia, or other state and territory courts that deal with family law cases. The FCFCA will have a single federal point of entry for all Australian family law matters. Urgent and high risk cases will continue to be prioritised, and each case will be allocated at the earliest possible point to the relevant judge and division with the right expertise and capacity to deal with it. In addition the new FCFCA is to operate under the leadership of one Chief Justice with the support of one Deputy Chief Justice. Each will hold a dual commission to both Divisions of the FCFCA allowing for more effective allocation of cases between the two Divisions and enabling the new FCFCA to operate under a common case management process, resulting in a more efficient and consistent handling of family law matters. For more information see our previous article here.

The Process of Developing the Legislation

In his media release, the Attorney-General indicated that the proposed legislation has been carefully developed to reflect "extensive consultation" with the courts and ". . . taking into consideration a large number of inquiries over the last decade which each related to the efficiency of the federal courts and the family law system", these include according to the Attorney-General:

  • the 2008 Semple Review entitled 'Future Governance Options for Federal Family Law Courts in Australia: Striking the Right Balance';
  • a 2014 KPMG Review entitled 'Review of the performance and funding of the Federal Court of Australia, the Family Court of Australia and the Federal Circuit Court of Australia';
  • a 2015 EY Report entitled 'High Level Financial Analysis of Court Reform Initiatives';
  • the 2017 House of Representatives Standing Committee on Social Policy and Legal Affairs Report entitled 'A better family law system to support and protect those affected by family violence: Recommendations for an accessible, equitable and responsive family law system which better prioritises safety of those affected by family violence'; and
  • a 2018 PwC Report entitled 'Review of efficiency of the operation of the federal courts'.

The PwC Report

The PwC Report indicates that the reviews terms of reference from the Government required it to consider consider: 

  • differences in case allocation, 
  • case management rules and approaches, and 
  • Court Rules between the courts and 
  • how increased standardisation of the courts’ operations could result in time and cost efficiencies. 

The PwC Report found that of the opportunities that were assessed in its review, the following were the most promising:

  • opportunities appear greatest in addressing the entry point and process for managing first instance matters, but in terms of ease of implementation, aspects of judicial practice may provide "quick wins".
  • opportunities with greatest positive impact to litigants are in respect to the first instance jurisdiction , while the greatest ongoing cost savings are most likely arising from case management opportunities.
  • cultural barriers to implementation are most likely among the appeal reform opportunities, but these may be implemented with relatively less upfront investment, and create material time and cost savings to both the courts and litigants. 

Commenting on the PwC Report the Attorney General said that it:

" . . . focused its analysis on measuring relative outcomes based on comparisons of several key performance indicators and it highlights contrasting performance outcomes between the two existing courts and identifies some of the areas that contribute to serious delays in settling disputes, and estimates the potential efficiency gains that could be achieved by reform and so produce significant improvements for Australian families."

Australian Law Reform Commission Report 

In his media release, the Attorney-General referenced the Australian Law Reform Commission's (ALRC) comprehensive review of the family law system which began on 1 October 2017 and is to report by 31 March 2019, saying: 

"The Australian Law Reform Commission is already undertaking an extensive review of the family law that underpins the family law system and I look forward to receiving its report at the end of March 2019 which could inform potential future reform to the Family Law Act to be considered once the present structural reforms are concluded."

The AG differentiates the work of the ALRC saying:

"In the meantime, the legislation to be introduced focuses on improving the administration of the courts dealing with family law matters with one overriding focus – to improve services for families who require the court so that they and any children affected can move on with their lives. Any future ALRC recommendations relating to court processes that merit implementation will be more easily implemented in a new, simplified court structure."

Reaction and Comment

The Australian reports that family law practitioners could be hit with personal costs orders if they fail to help resolve disputes as “quickly, inexpensively and efficiently” as possible and if their ". . . fees become disproportionate to the issues in dispute, . . .". The new duties are reported to be imposed on lawyers as a result of observations by a Family Court judge attacking the “. . . obscenely high legal costs” charged by family lawyers and an apparent “. . . win at all costs, concede little or nothing, chase every rabbit down every hole” approach.

Another reported aspect is that couples at loggerheads will also be obliged to resolve disputes quickly, and if disputes are dragged out with the intention of running up costs for the other side, or there is refusal to accept a reasonable settlement offer, the couples could face indemnity costs orders, mirroring laws that already apply in the Federal Court.

The commonly reported view among the legal profession is that the Bill proposing to merge the Federal Circuit Court and the Family Court is unlikely to alleviate the crisis in the family law court system and may in fact place significant extra pressure on already overburdened Federal Circuit Court Judges. The Law Council of Australia President, Morry Bailes, is reported as saying that the Law Council will consider the Bills in detail and then provide a considered national response, but that generally, ". . . the legal profession [holds] significant concerns with the proposed merger of the two courts". He has also said:

“It’s critical that the family court process, and the broader family law system, is properly resourced, accessible, responsive, and efficiently doing justice according to law, . . . However, Australia’s family court system today is in crisis. Chronic under funding for more than a decade has led to a court system which continually struggles to meet the needs of the community. . . . As it stands, the measures introduced into parliament provide no extra funding for the chronically under-resourced court system or associated support services, which enable the court system to deal with cases more quickly. . . . Our current understanding is the Australian Government will not make any new appointments of judges to the specialised Division 1 of the new court, meaning the quality of the family law justice system would reduce under this change. Australians may no longer have access to a court that specialises in family law.”

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