AUSTRALIA Law and Practice Contributed by: Joachim Delaney and Ranjani Sundar, HFW
1.6 Rules of Pre-Action Conduct There are no specific rules of pre-action conduct that apply prior to the commencement of fraud claims. However, jurisdictions do impose formalities that are to be completed prior to or at the time civil proceed - ings are commenced more generally. Specifically, the Civil Dispute Resolution Act 2011 (Cth) (CDRA) requires applicants to file a “genuine steps statement”, which sets out the steps taken by the parties to resolve the dispute or otherwise explain why no such steps have been taken (in the case of fraud claims, the urgency of the matter or anonymity of the fraudster may prevent the parties from taking “genuine steps” before commencing proceedings). Section 4 (1) of the CDRA outlines examples of genu - ine steps that a person can take to resolve a dispute, including: • notifying the other person of the issues that are, or may be, in dispute, and offering to discuss them, with a view to resolving the dispute; • responding appropriately to any such notification; • providing relevant information and documents to the other person to enable the other to understand the issues involved and how the dispute might be resolved; • considering whether the dispute could be resolved by a process facilitated by another person, includ - ing an alternative dispute resolution process; • if such a process is agreed to: (a) agreeing on a particular person to facilitate the process; and (b) attending the process; • if such a process is conducted but does not result in resolution of the dispute – considering a different process; and • attempting to negotiate with the other person, with a view to resolving some or all of the issues in dis - pute, or authorising a representative to do so. A party that does not file a genuine steps statement, or that has not taken genuine steps to resolve a dis - pute, will not be prevented from commencing a claim in the Federal Court of Australia. However, the court may take this into account when exercising its pow - ers, including its discretion to award costs.
Generally speaking, the courts of the states/territo - ries do not impose similar formalities on prospective claimants. 1.7 Prevention of Defendants Dissipating or Secreting Assets Freezing orders can be obtained in each Austral - ian jurisdiction to prevent the loss or dissipation of assets (Uniform Civil Procedure Rules 2005 (NSW) Part 25 Division 2; Uniform Civil Procedure Rules 1999 (Qld) Chapter 8 Part 2 Division 2; Uniform Civil Rules 2020 (SA) Chapter 10 Part 2 Division 5; Supreme Court Rules 1987 (NT) Regulation 37A.02; Rules of Supreme Court 1971 (WA) Order 52A; Supreme Court Rules 2000 (Tas) Part 36 Division 1A; Court Procedure Rules 2006 (ACT) Part 2.9 Division 2.9.4 Sub-division 2.9.4.2; Supreme Court (General Civil Procedure) Rules 2015 (Vic) Order 37A.02). Freezing orders may be obtained on an interim basis pending the outcome of a final hearing. The court has a discretion to grant a freezing order. In accordance with Part 25 Division 2 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR), in order to obtain a freez - ing order, the applicant must: • show that there is a good arguable case against the wrongdoer; • show that there is a real risk the wrongdoer is likely to dissipate the assets; • where an order is sought against a third party, show that the third party is holding, using or is otherwise in possession of the asset; and • address discretionary concerns, such as the form of the order and the value of the relevant assets. Freezing orders are classified as “in personam” orders, meaning that their operation is concerned with individuals rather than with specific assets. This dis - tinction is significant, as it means that orders are not limited to within Australia (that is, a “domestic freezing order”); rather, the orders may also deal with assets that are located overseas (ie, a “worldwide freezing order”) provided that the court is satisfied that the order “is undoubtedly relevant to the exercise of the court’s discretion to grant the order” ( Deputy Commis- sioner of Taxation v Huang [2021] HCA 43 [30]).
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