Case: Morris v Hanley [2001] NSWCA 374
Outcome: considered
In Morris v Hanley [2001] NSWCA 374 , Heydon JA (with whom Foster and Rolfe AJJA agreed) said, at par 22: '[22] The duty of judges is to give reasons for the directions and orders they make must be lower where interlocutory orders affecting matters of practice and procedure are involved than they are where orders are made after a trial. That must be so if for no other reason than that litigation would clog up to the point of stagnation if full reasons had to be given for the tens or hundreds of interlocutory orders which many primary judges make in a week in busy trial courts. However, though applications for security for costs are matters of practice and procedure, they can have a significant impact on the substantive rights of plaintiffs, because if the order is made, the plaintiff may not be able to provide security for costs where one of the grounds for the application is that plaintiff's lack of funds. If so, that will prevent the plaintiff being able to have a judicial examination of the complaints made on the merits. Accordingly it would not be right to hold that there is no duty, or only a very exiguous duty, on a primary judge to give reasons for making an order as to security for costs. [23] The primary judge in giving his reasons for the orders under appeal in many respects went well beyond what was called for by the duty to give reasons. The reasons for judgment he provided, particularly given that they were ex tempore, set out in considerable detail his approach. However, there is force in the argument of the plaintiff that insufficient reasons were given in relation to the question of the defendants' delay ... [24] ... Sometimes what might otherwise be said to be a deficiency in the reasons of a primary judge can be compensated for by a clear explanation in the course of argument by the primary judge for the outcome. However, that cure cannot be resorted to here. This Court does not have before it any transcript of the oral argument before the primary judge, and it has before it no affidavit indicating anything he may have said in the course of argument which would explain how he took the defendants' delay into account. [25] In those circumstances there is an error of principle in the primary judge's approach. 18 It seems to me that what was held to be, in that case, a failure to give adequate reasons must be the 'high water mark' of a judge's obligation to give reasons for interlocutory orders. I think there is room for the view that there was a desired result on the appeal searching for a reason to make it. 19 In my opinion, it is cases like Morris v Hanley [2001] NSWCA 374 that support the view of trial judges that appellate judges can be likened to those who come down out of the hills after the battle is over and shoot the wounded. 20 Nevertheless it is clear that, even on interlocutory orders, there is a duty to give adequate reasons, which do not display error. 21 It is sufficient in respect of other aspects of the application for leave to indicate that in my opinion it is arguable that the conclusion of the primary judge in dismissing the application for security was tainted by misapplication of principle, and an improper interpretation of s 1335 of the Corporations Act 2001 (Cth) and s 56 of the Federal Court of Australia Act 1976 (Cth). In particular, it is arguable that principles dealing with the impecuniosity of a plaintiff who is a natural person, have no application in relation to corporations falling within s 1335.