Policy relating to Sections 34D and 42C of the Administrative Appeals Tribunal Act 1975
Introduction
This document sets out the Tribunal’s approach to agreements lodged and decisions made under sections 34D and 42C of the Administrative Appeals Tribunal Act 1975 (AAT Act). The document identifies:
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circumstances in which agreements are likely to come within section 34D of the AAT Act;
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information that a Tribunal member or Conference Registrar undertaking an alternative dispute resolution process (ADR process) should usually provide to the parties in relation to consent agreements including the form of agreements to be given to the Tribunal;
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information that a Tribunal member or Conference Registrar undertaking an ADR process should usually record to assist the Tribunal to identify whether a consent decision should be made under section 34D or 42C of the AAT Act;
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how to process agreements lodged under section 34D or 42C of the AAT Act and, in particular, how to deal with situations in which there is doubt as to whether a consent decision should be issued under section 34D or 42C;
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the form of decisions made under sections 34D and 42C of the AAT Act.
The law
Section 34D of the AAT Act provides as follows:
(1) If:
(a) in the course of an alternative dispute resolution process under this Division, agreement is
reached between the parties or their representatives as to the terms of a decision of the Tribunal:
(i) in the proceeding; or
(ii) in relation to the part of the proceeding; or
(iii) in relation to the matter arising out of the proceeding;
that would be acceptable to the parties; and
(b) the terms of the agreement are reduced to writing, signed by or on behalf of the parties and lodged
with the Tribunal; and
(c) 7 days pass after lodgment, and none of the parties has notified the Tribunal in writing that he or she
wishes to withdraw from the agreement; and
(d) the Tribunal is satisfied that a decision in the terms of the agreement or consistent with those terms
would be within the powers of the Tribunal;
the Tribunal may, if it appears to it to be appropriate to do so, act in accordance with whichever of
subsection (2) or (3) is relevant in the particular case.
(2) If the agreement reached is an agreement as to the terms of a decision of the Tribunal in the proceeding,
the Tribunal may, without holding a hearing of the proceeding, make a decision in accordance with those
terms.
(3) If the agreement relates to:
(a) a part of the proceeding; or
(b) a matter arising out of the proceeding;
the Tribunal may, in its decision in the proceeding, give effect to the terms of the agreement without dealing
at the hearing of the proceeding with the part of the proceeding or the matter arising out of the proceeding,
as the case may be, to which the agreement relates.
An ADR process under Division 3 of Part IV of the AAT Act includes any of the following events held pursuant to section 34A or 34B of the AAT Act:
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a conference;
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a conciliation;
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a mediation;
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a case appraisal; or
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a neutral evaluation.
Section 42C of the AAT Act provides as follows:
(1) If, at any stage of a proceeding for a review of a decision:
(a) agreement is reached between the parties or their representatives as to the terms of a decision of
the Tribunal in the proceeding or in relation to a part of the proceeding or a matter arising out of the
proceeding that would be acceptable to the parties (other than an agreement reached in the
course of an alternative dispute resolution process under Division 3); and
(b) the terms of the agreement are reduced to writing, signed by or on behalf of the parties and lodged
with the Tribunal; and
(c) the Tribunal is satisfied that a decision in those terms or consistent with those terms would be within
the powers of the Tribunal;
the Tribunal may, if it appears to it to be appropriate to do so, act in accordance with whichever of
subsection (2) or (3) is relevant in the particular case.
(2) If the agreement reached is an agreement as to the terms of a decision of the Tribunal in the proceeding,
the Tribunal may make a decision in accordance with those terms without holding a hearing of the
proceeding or, if a hearing has commenced, without completing the hearing.
(3) If the agreement relates to a part of the proceeding or a matter arising out of the proceeding, the Tribunal
may in its decision in the proceeding give effect to the terms of the agreement without, if it has not already
done so, dealing at the hearing of the proceeding with the part of the proceeding or the matter arising out of
the proceeding, as the case may be, to which the agreement relates.
Where section 34D of the AAT Act applies, the Tribunal must not make a decision in accordance with terms of agreement lodged with the Tribunal unless:
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7 days have passed after the written terms of the agreement were lodged; and
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none of the parties has notified the Tribunal in writing that he or she wishes to withdraw from the agreement.
Where terms of agreement are lodged in accordance with section 42C of the AAT Act, the Tribunal may proceed to make a decision in accordance with the terms immediately.
It appears that the 7-day cooling-off period has been introduced to give parties who reach agreement during an ADR process an opportunity to consider whether or not they wish to maintain that agreement. It gives a person time to reflect on the agreement made free of the pressures that can exist during a conference, conciliation, mediation or other ADR process.
When agreements are likely to come within section 34D of the AAT Act
For section 34D of the AAT Act to apply, the parties or their representatives must reach an agreement and the agreement must be:
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as to the terms of a decision that the Tribunal could make; and
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reached in the course of an ADR process.
Please note that there is no requirement that the terms of settlement must be reduced to writing and signed in the course of the ADR process. Section 34D will apply if an oral agreement is reached and the parties lodge written terms of agreement after the ADR process has concluded.
Although a statement by the parties will not always be conclusive, the views of the parties as to whether the agreement was reached under sections 34D or 42C should ordinarily be relied upon. Parties should be encouraged to include such a statement in their settlement agreement.
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Circumstances in which section 34D is likely to apply
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The parties or their representatives reach agreement and sign terms of agreement during a conference, conciliation, mediation or other ADR process.
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During a conference, conciliation, mediation or other ADR process, the parties or their representatives reach an oral agreement as to the terms of a consent decision. Written terms of agreement consistent with those terms are subsequently lodged with the Tribunal.
Section 34D is likely to apply to an oral agreement reached during an ADR process even if:
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the agreement was reached by representatives of the parties and either or both representatives must obtain instructions to accept the agreement; but in that event, the Tribunal member or Conference Registrar should ensure that the ADR process is adjourned rather than concluded;
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the agreement is contingent on one or more minor matters occurring such as the respondent confirming the amount of compensation that will be payable or the applicant providing to the respondent certain documents relevant to the claim.
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A conference, conciliation, mediation or other ADR process is conducted and adjourned. On resuming the ADR process, the parties advise the Tribunal member or Conference Registrar that the parties have reached agreement as to the terms of a consent decision. Written terms of agreement are signed at the resumed ADR process or terms consistent with the terms agreed are subsequently lodged with the Tribunal.
[Please note that, where a conference is held and it is decided that a further conference will be listed in the future, this is not generally considered to be an adjournment of the first conference. The effect of the listing direction signed by Listing Coordinators is that each conference in the Tribunal’s list is a new conference held in accordance with paragraph 34A(1)(a).
A conference may be treated as having been adjourned where, for example, the time allotted for the conference has expired but the Tribunal and the parties have not concluded their discussions. The conference is adjourned to resume later that day or within a short period of time after the conference has concluded but is not re-listed.If at a conference the parties advise the Tribunal member or Conference Registrar that they seek time to pursue settlement negotiations and request that a further conference be listed at a future date, this might not be considered to be an adjournment of the first conference.]
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Circumstances in which section 34D is not likely to apply
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The parties or their representatives attend a conference, conciliation, mediation or other ADR process and inform the Tribunal member or Conference Registrar that they have already reached agreement as to the terms of a decision.
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During a conference, conciliation, mediation or other ADR process, the parties or their representatives discuss settlement and indicate an intention to settle the matter but do not reach agreement.
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The parties or their representatives have reached an oral agreement as to the terms of a consent decision during the course of a conference, conciliation, mediation or other ADR process but the written terms of agreement lodged with the Tribunal are substantially different from the terms agreed during the ADR process.
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At any stage of the proceeding, the parties lodge written terms of agreement which reflect an agreement not made in the course of an ADR process. The terms may be lodged before the first conference is held, at a time between a first and second conference, prior to a conciliation or mediation or at any time prior to hearing.
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The parties in a social security matter relating to an overpayment lodge written terms of agreement under the A New Tax System (Family Assistance) (Administration) Act 1999 or the Social Security (Administration) Act 1999.
It may not always be clear whether or not section 34D of the AAT Act applies to an agreement that is reached between the parties. In such circumstances, it is preferable to treat the agreement as one to which section 34D applies.
Information for parties in relation to consent agreements and decisions
The Tribunal member or Conference Registrar conducting a conference, conciliation, mediation or other ADR process should provide information to the parties about the operation of sections 34D and 42C of the AAT Act as considered appropriate in the circumstances.
In conciliations and mediations, general information about the effect of reaching agreement in the course of the ADR process, including the availability of the cooling-off period, should be given to the parties at the commencement of the ADR process. Whether information of this kind should be provided at the commencement of a conference will depend on whether the Tribunal member or Conference Registrar considers that the parties may reach agreement during the conference.
Where the parties or their representatives reach an agreement to which section 34D is likely to apply but terms of agreement are not signed during the ADR process, the Tribunal member or Conference Registrar should:
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inform the parties that the report on the ADR process will include a note to the effect that the parties reached such an agreement;
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advise the parties that the terms of agreement should specify that they are lodged pursuant to section 34D of the AAT Act;
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explain the operation of the cooling-off period.
Where an agreement to which section 34D is likely to apply has not been reached, the Tribunal member or Conference Registrar should, where it appears appropriate to do so:
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clarify with the parties whether or not the particular ADR process is being adjourned or has concluded;
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where it appears that the parties may lodge terms of agreement with the Tribunal after an ADR process has concluded, advise the parties that any terms of agreement should specify whether they are lodged pursuant to section 34D or 42C.
An information sheet in relation to terms of agreement and consent decisions under the AAT Act is available to provide to parties. A copy of the information sheet is attached to this policy.
Information to be recorded by Tribunal members and Conference Registrars conducting ADR processes
When parties lodge terms of agreement with the Tribunal, staff and the Tribunal member making the consent decision must be able to identify whether that decision is to be made under section 34D or 42C of the AAT Act. Tribunal members and Conference Registrars who conduct ADR processes should record information that will assist in establishing this.
Tribunal members and Conference Registrars who conduct ADR processes should note the following information in the report of the ADR process:
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whether the ADR process has been adjourned or has concluded;
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whether or not the parties or their representatives have reached an agreement to which section 34D of the AAT Act applies;
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where an agreement has been reached to which section 34D of the AAT Act is likely to apply, an outline of the terms of the consent decision that were agreed.
Where it is unclear whether or not an agreement has been reached to which section 34D of the AAT Act applies, this should be noted in the report.
Processing consent agreements
When parties lodge written terms of agreement with the Tribunal, staff will check whether the consent decision is to be made under section 34D or 42C of the AAT Act. If it is unclear from the Tribunal file whether the agreement was reached in the course of an ADR process or if the terms of agreement lodged appear to differ substantially from the terms agreed in the course of the ADR process, staff will consult the Tribunal member or Conference Registrar who conducted the relevant ADR process.
Where terms of agreement are lodged to which section 34D applies or where it is not clear whether they are subject to section 34D or 42C, the Tribunal will not make a decision until the 8th calendar day after the terms were lodged.
If the Tribunal is satisfied that terms of agreement have been lodged pursuant to section 42C of the AAT Act, the Tribunal may proceed to make a decision at any time.
[Please note that the processes described above are in addition to the usual checks undertaken in relation to terms of agreement lodged with the Tribunal. Before making a decision under section 34D or 42C, the Tribunal must be satisfied that the decision is within its power and is otherwise appropriate to make.]
Form of section 34D and 42C agreements
Because every section 34D or 42C agreement is a product of the consensus of the parties they are the best ultimate source of information about how the agreement was reached. Accordingly, every effort should be made to procure a statement in each consent agreement as to whether it was reached under section 34D or 42C. Such a statement by the parties ought ordinarily to be treated as conclusive.
A consent decision made by the Tribunal should specify clearly whether the decision is being made pursuant to sections 34D or 42C of the AAT Act.
Information Sheet for Parties:
Terms of Agreement and Consent Decisions under the Administrative Appeals Tribunal Act 1975
Where the parties reach agreement as to the terms of a decision in a matter, the Tribunal may give effect to the agreement under either section 34D or section 42C of the Administrative Appeals Tribunal Act 1975 (AAT Act). With respect to both provisions, the terms of agreement must be in writing, signed by or on behalf of the parties and lodged with the Tribunal.
Whether section 34D or section 42C of the AAT Act applies to the agreement depends on how the parties reach agreement as to the terms of the consent decision.
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Section 34D applies when the agreement is reached in the course of an alternative dispute resolution process (ADR process) including a conference, mediation or conciliation.
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Section 42C applies when the agreement is reached by other means.
Section 34D of the AAT Act applies to an agreement reached in the course of an ADR process whether that agreement is oral or in writing. If an oral agreement is concluded, section 34D will apply to terms of agreement that are reduced to writing or signed after the ADR process has concluded.
Where section 34D applies to an agreement, a 7-day cooling-off period applies. The Tribunal must wait 7 days before making a decision in accordance with the terms. The Tribunal cannot make such a decision if either party notifies the Tribunal in writing within 7 days after the terms were lodged that the party wishes to withdraw from the agreement.
Where the parties have lodged an agreement under section 42C of the AAT Act, the Tribunal may proceed to make a decision in accordance with the terms of agreement immediately.
When preparing terms of agreement for a consent decision, parties must specify clearly in the agreement whether the agreement is lodged pursuant to section 34D or section 42C of the AAT Act.
Terms of agreement should be lodged as soon as possible after the agreement has been reached. If the terms of agreement are to include a clause relating to costs but the parties are unable to agree within a reasonable time as to the actual amount of costs to be paid, the terms of agreement should specify that costs will be awarded “as agreed or taxed”.
Please note that the Tribunal will give effect to an agreement under either section 34D or 42C of the AAT Act only if:
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it is satisfied that a decision in or consistent with the terms of the agreement would be within the powers of the Tribunal; and
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it appears to the Tribunal that it would be appropriate to give effect to the agreement. (1)
Footnote
(1) See sections 34D and 42C of the Administrative Appeals Tribunal Act 1975.