Delay in com­mence­ment of New South Wales rea­son­able steps” legislation

In Brief

On 8 Sep­tem­ber 2011, the New South Wales Par­lia­ment passed the Courts and Oth­er Leg­is­la­tion Fur­ther Amend­ment Bill 2011 (Bill). The Bill will bring into effect a lengthy post­pone­ment of up to 18 months of new leg­is­la­tion, requir­ing par­ties to take rea­son­able steps to seek to resolve a dis­pute before court pro­ceed­ings are commenced.

The new leg­is­la­tion, con­tained in Part 2A of the Civ­il Pro­ce­dure Act 2005 (NSW), was due to apply to pro­ceed­ings com­menced on or after 1 Octo­ber 2011. It is designed to encour­age ear­ly res­o­lu­tion of dis­putes by impos­ing require­ments for par­ties to take rea­son­able steps, before they com­mence court pro­ceed­ings, to seek to resolve their dis­pute or to nar­row the issues that are in dis­pute between them.

In his ini­tial announce­ment of the post­pone­ment on 23 August 2011 and dur­ing an Agree­ment in Prin­ci­ple speech regard­ing the Bill on 26 August 2011, the Attor­ney Gen­er­al has made it clear that the pur­pose of the post­pone­ment is to enable the NSW Gov­ern­ment to mon­i­tor and eval­u­ate the suc­cess of sim­i­lar pro­vi­sions which recent­ly com­menced in the Fed­er­al Court and Fed­er­al Mag­is­trates Court. Those pro­vi­sions are the gen­uine steps require­ments con­tained in the Civ­il Dis­pute Res­o­lu­tion Act 2011 (Cth).

The Attor­ney Gen­er­al expects that the eval­u­a­tion by the NSW Gov­ern­ment of the suc­cess of the new fed­er­al court require­ments will take approx­i­mate­ly 12 to 18 months, with the Bill allow­ing for the reforms to com­mence on 1 April 2013 or on any ear­li­er date the Gov­ern­ment sets by proclamation.

Address­ing the rea­son for the post­pone­ment in his Agree­ment in Prin­ci­ple speech regard­ing the Bill, the Attor­ney Gen­er­al named senior mem­bers of the judi­cia­ry, the legal pro­fes­sion and indus­try groups” as stake­hold­ers who despite sup­port­ing the over­all intent of the leg­is­la­tion, have raised con­cerns since the March 2011 elec­tion regard­ing the poten­tial effects of the new require­ments. The Attor­ney Gen­er­al indi­cat­ed that the con­cerns held by these stake­hold­ers are that the reforms will increase costs and delays involved in res­o­lu­tion of dis­putes for the par­ties involved in dis­putes and for the courts. 

In rela­tion to the long term future of the reforms, the Attor­ney Gen­er­al not­ed that the Gov­ern­ment does not pro­pose that Part 2A be repealed at this time and that it remains sup­port­ive of the over­ar­ch­ing pol­i­cy objec­tives” of the leg­is­la­tion. It is clear that a deci­sion about imple­ment­ing the reforms will be made with­in the next 18 months.

Click here to see the full text of the Attor­ney Gen­er­al’s announce­ment regard­ing the post­pone­ment.

Click here to see the full text of the Attor­ney Gen­er­al’s Agree­ment in Prin­ci­ple speech regard­ing the Bill.