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What are court-ordered references?
A reference involves the court making an order to appoint a referee (or a panel of referees) to assist the court in determining questions of fact or law in dispute in a proceeding.
A reference may be ordered at any stage of a proceeding and may be conducted as an interlocutory process (ie, for disputes about standing or discovery) in parallel with the substantive proceeding.
Referees may be “subject matter experts” with expertise in an area of specialised knowledge, or “independent fact finders” with experience in resolving factual disputes (such as retired judges or senior barristers). Referees may be proposed by the parties or nominated by the court.
Once appointed, a referee conducts an inquiry in accordance with the terms of the reference and prepares a report that addresses the questions put to it by the court. On receipt of the report, the court must decide whether to adopt (in whole or in part), vary or reject the referee’s findings at an adoption hearing.
The increasing use of references
Historically, references have been used in cases that involve highly technical subject matter, such as complex construction cases. In recent times, however, references have been increasingly utilised in class actions, insolvency proceedings and other complex commercial cases.
This uptick in the use of references may be traced back to the decisions of Justice Rares of the Federal Court in Optiver Australia Pty Ltd v Tibra Trading [2012] FCA 558 and Justice Lee in Kadam v Miiresorts Group 1 Pty Ltd (No 4) [2017] FCA 1139, where the latter summarised the history of references (and analogous processes).
Subsequent decisions of Justice Lee have established a body of consistent modern caselaw supporting the use of references.
In November 2022, the Federal Court issued the Referee and Assessor Practice Note (GPN-REF), which effectively synthesises the court’s reasoning in recent cases and provides that the court’s finite resources must be marshalled with discrimination in the public interest, transcending the specific interests of the parties.
What types of questions may be referred out?
In most Australian jurisdictions, courts may refer any questions of procedure, fact, law, or mixed questions of fact and law, for determination.
Recent case examples of the types of questions that have been referred out include:
Following the decision in Santos, it is possible that "bulk referrals” of all legal and factual issues in a dispute may become more common.
What are the benefits and risks of references?
Some advantages of references include that:
Some potential disadvantages include that:
References in practice – top tips and takeaways
Practical Guidance Dispute Resolution is here to give you the edge
For a practical summary of the reference process in the Federal Court, including how to advise your clients about references, consult our detailed guidance notes in Practical Guidance Dispute Resolution, including Federal Court – Referral of proceedings to referees.
To access further guidance, including practical tips for making or opposing an application for a reference, preparing submissions to the court, and navigating a referee’s inquiry, please contact us to arrange a trial of Practical Guidance Dispute Resolution.
To view The Legal Edge Expert Webinar: A new way to litigate: The increasing use of court-appointed referees in complex litigation – what you need to know in full, please click here.
Legal Advice disclaimer: All information provided in this document is general in nature and is provided for educational purposes only. It should not be construed as legal advice. For legal advice applicable to the facts of your situation, you should obtain the services of a qualified solicitor licensed to practice in your state/territory. Information contained in this document is current as of 18 May 2023.