Negotiating the Third Way: Developing Effective Process in Civil Penalty Litigation

Abstract

Civil penalties are a product of regulatory law and they fit uneasily within the civil-criminal procedural divide. Disputes about procedure in civil penalty litigation are frequently resolved by resort to criminal rather than civil analytical frameworks, due to conflation of the privilege against exposure to a penalty with the privilege against self-incrimination. Two recent cases, Macdonald v Australian Securities and Investments Commission [2007] NSWCA 304 and Australian Securities and Investments Commission v Mining Projects Group Ltd (2007) 164 FCR 32; [2007] FCA 1620, regarding the proper ambit of disclosure in a defence, demonstrate the further embrace of the criminal model and the concomitant complication of the plaintiff’s case. The area is ripe for law reform, though incremental change is difficult to achieve in case law, where judges focus upon the individual rights of defendants. Instead, a paradigm shift is required which reconsiders the bifurcation of civil and criminal procedure to accommodate regulatory law and statutory remedies effectively.

Keywords: civil penaty, corporate law, process, duty of fairness, prosecutorial fairness, privilege, regulation

JEL Classification: K20, K22, K41