Which case won?

The case for the Australian director
  • The reason why this claim has been made in the religious court is because it is based on wholly unfounded allegations and would have no prospect of success in any civil court in any country.
  • The religious court has jurisdiction over personal matters such as divorce, child abuse and women’s rights in marriage. It has no jurisdiction over a commercial dispute between corporations such as this one.
  • The religious court does not have the power to arbitrate, and the conflict resolution clause, which referred to its chief judge rather than to the court itself, did not confer that power on it.
  • Even if the religious court had this power, in the multiple communications following the termination of the agreement, it has displayed apprehended bias, in the form of exchanges which excluded me, and advice given to the American company’s director about how he might formulate his claim, in breach of the requirements of procedural fairness (frequently also called “natural justice”).
  • The religious sanctions with which I have been threatened by the clerics would have severe consequences for me personally and would impact upon my good name and reputation, which I have built up over many years in the business world.
  • The conduct of the US director and the clerics amounts to a criminal contempt of court, in that they were attempting to interfere with the proper course of justice by making threats to me which were tantamount to threats of excommunication, in order to deter me from approaching the courts of New South Wales.
The case for the clerics
  • All members of our religion must seek resolution of their conflicts before the religious court, rather than in the secular courts, regardless of any agreement that they have signed.
  • All practising members of our religion are obliged to comply with religious law, which dictates, among other things, that practising members of the religion must comply with a summons to attend a hearing before the religious court to arbitrate on a dispute. Refusing a summons to the religious court is not an option for any member of our religion who wishes to remain within its framework. Such a refusal will invoke inevitable consequences in the form of religious sanctions.
  • The religious sanctions which have been threatened are a justifiable and legitimate response to a religious transgression on the part of someone who professes to be a member of our religion.
  • The conflict resolution clause in the contract is a red herring. The religious court has the power to arbitrate in the dispute independently of the conflict resolution clause. Provided that the parties to the hearing of the dispute entered an agreement under the NSW Commercial Arbitration Act 2010, the resulting decision could be registered and thus enforceable as though it were the decision of an ordinary civil court.
  • The common law rules of procedural fairness do not apply to the proceedings of the religious court, and would apply to the parties to the hearing only when an agreement under the Commercial Arbitration Act was made (although conduct of the religious court is subject under the customary law to rules similar to the rules of procedural fairness).
  • There was no bias displayed in the communications complained of. The director of the US company was just an “impatient litigant”, of whom we had little prior knowledge. Acting as judges, were simply trying to bring the case on for hearing.

So, which case won?

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Expert commentary on the court's decision

Geoff Baldwin
Geoff BaldwinConsultant Lawyer
“That the case arose at all may surprise some readers who might think the time-honoured separation of church and state was beyond any challenge.”
Supreme Court finds clerics guilty of contempt of court

In Live Group Pty Ltd & Anor v Rabbi Ulman & Ors [2017] NSWSC 1759, the judge said he was “not persuaded” that the Supreme Court had the power to intervene in the affairs of the religious court (called the “Beth Din”, and comprised of judges who were Jewish rabbis), although he said that he was in no doubt that the plaintiff had been denied procedural fairness.

There were ten “charges” of criminal contempt, which related to many aspects of the conduct of the director of the US company, Mr Jesse Kuzecki, and the rabbis. Most of these charges were dismissed.

However, two of the charges – the threat, effectively from the rabbis, to impose religious sanctions on the director of the Australian company, Mr Reuven Barukh, and a later email repeating the threats – were found by the judge to amount to criminal contempt.

This was because “as a matter of practical reality [they had] the tendency to interfere with the administration of justice” by attempting to coerce Mr Barukh into submitting to process of the Beth Din, and in so doing attempting to deter him from approaching the courts of New South Wales.

His Honour imposed a penalty of $20,000 on the chief judge of the Beth Din, Rabbi Moshe Gutnick, and penalties of $10,000 each on the other three rabbis.

Appeal court reduces monetary penalties but upholds findings of criminal contempt

On appeal to the NSW Court of Appeal, in Ulman v Live Group Pty Ltd [2018] NSWCA 338, the monetary penalties were found to be excessive and were reduced, because of the unlikeliness that the rabbis  would re-offend, and because of the “extra-curial punishment” (ie punishment outside the court system) they had suffered, evidently being considerable damaging publicity arising from the initial judgment.

However, the findings of criminal contempt were upheld.

That the case arose at all may surprise some readers who might think the time-honoured separation of church and state was beyond any challenge. However, the decision reaffirms the primacy of the courts established as part of the apparatus of Westminster-style democracies.

NOTICE: This article is accurate as at the time of publication and does not constitute legal advice. Please see our legal notices page for more information. Information related to coronavirus can be outdated very quickly.

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