Newcastle Mercury Hotel Nominees Pty Limited v Nepean Specialist Clinic Pty Limited [2009] NSWSC 839 (14 August 2009)

Last Updated: 24 August 2009

NEW SOUTH WALES SUPREME COURT

CITATION:
Newcastle Mercury Hotel Nominees Pty Limited v Nepean Specialist Clinic Pty Limited [2009] NSWSC 839


JURISDICTION:
Supreme Court of New South Wales

FILE NUMBER(S):
1292/09

HEARING DATE(S):
14 August 2009

JUDGMENT DATE:
14 August 2009

EX TEMPORE DATE:
14 August 2009

PARTIES:
Newcastle Mercury Hotel Nominees Pty Limited (first plaintiff)
Gregory Kenneth Mitchell (second plaintiff)
Lisa Jane Mitchell (third plaintiff)
Brett William Jones (fourth plaintiff)
Nepean Specialist Clinic Pty Limited (first defendant)
Gregory Eric Allchin (second defendant)
Malcolm John Borland (third defendant)

JUDGMENT OF:
Hamilton AJ

LOWER COURT JURISDICTION:
Not Applicable

LOWER COURT FILE NUMBER(S):
Not Applicable

LOWER COURT JUDICIAL OFFICER:
Not Applicable



COUNSEL:
T. Maltz (plaintiff)
B. DeBuse (defendant)

SOLICITORS:
Baron & Associates
Reimer Winter Williamson


CATCHWORDS:
PROCEDURE [105] – Supreme Court procedure – Practice under Supreme Court Rules – Directions – Power to make directions to facilitate just, quick and cheap disposal of real issues between parties – Order that party obtain copies of its taxation documents from ATO and furnish them to opposing party.

LEGISLATION CITED:
Civil Procedure Act 2005, s 61
Evidence Act 1995, s 119

CATEGORY:
Procedural and other rulings

CASES CITED:
Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501
Palmdale Insurance Ltd (in liq) v L Grollo & Co Pty Ltd [1987] VR 113
Roach v Page, NSWSC, McLaughlin M, 22 April 1998 (unreported)
Schipp v Cameron (1997) 38 ATR 1
Sogelease Australia Ltd v Griffin [2003] NSWSC 178

TEXTS CITED:


DECISION:
Orders made for party to obtain copies of taxation documents from ATO and furnish same to opposing party



JUDGMENT:

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
DUTY LIST


HAMILTON AJ

Friday, 14 August 2009

1292/09 Newcastle Mercury Hotel Nominees Pty Limited & Ors v Nepean Specialist Clinic Pty Limited & Ors

JUDGMENT (ex tempore)

1 HIS HONOUR: I have before me a motion in which the plaintiffs in these proceedings are seeking an order that the defendants take all reasonable steps to apply to the Australian Taxation Office forthwith to obtain copies of all tax records of the first defendant for the 2002, 2003 and 2004 tax years; upon their receipt, to provide copies to the plaintiffs; and, if they are unable to provide such documents to the plaintiffs within 14 days, to file and serve an affidavit setting out the steps taken to obtain the documents.

2 The proceedings concern representations said to have been made in relation to the finances of a business which the first defendant conducted during part at least of the 2002 and 2003 tax years. The truth or accuracy of those representations is in issue. The documents appear to be relevant to that issue. Furthermore, their inclusion in Part 2 of the defendants’ list of documents may be taken to concede that relevance.

3 The evidence shows that the first defendant’s copies of these documents were destroyed in a flood. The original documents are of course, so far as they exist, in the possession of the Australian Taxation Office.

4 The first objection taken by the defendants to the orders sought is that they cannot or ought not be compelled to obtain, or have copied, documents that are not in their possession or power for the purposes of discovery.

5 Mr DeBuse, of counsel for the defendants, frankly concedes that there are a number of cases in which single Judges at least have made such orders. Those cases include the decision of Marks J in Palmdale Insurance Ltd (in liq) v L Grollo & Co Pty Ltd [1987] VR 113; the decision of Palmer J in Sogelease Australia Ltd v Griffin [2003] NSWSC 178; the decision of Einstein J in Schipp v Cameron (1997) 38 ATR 1; and the decision of McLaughlin M (as his Honour then was) in Roach v Page, 22 April 1998 (unreported). Mr DeBuse submits that these decisions are decisions of single judicial officers which are plainly wrong and that I ought not follow them.

6 Those decisions were not made as decisions relating to discovery but as to directions to facilitate the just, quick and cheap resolution of proceedings given under s 61 of the Civil Procedure Act 2005 or similar earlier provisions. I decline to refuse to follow those decisions, which I accept as correct and in accordance with the modern spirit of the conduct of litigation. I propose, subject to what follows, to follow that line of authority.

7 Mr DeBuse also relied, I think a little faintly, on an argument that, because of the lack of exact correspondence of periods relevant to the proceedings with the periods dealt with by the taxation records, the taxation records could not be regarded as relevant to the proceedings. That argument I reject and my rejection is supported by the concession of relevance made by the inclusion of the records in the list of documents.

8 The third basis on which Mr DeBuse resisted the order was that the copy documents would in any event be privileged under s 119 of the Evidence Act 1995 or the principle set out by the High Court in Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501, which related to documents taken under a search warrant, being copies made for the purposes of litigation of original documents that were not themselves privileged. The argument depended on the notion that the copies made by the Australian Taxation Office to comply with the request that the first defendant would be ordered to make, are to be regarded as copies that were brought into existence for the sole or dominant purpose of use in legal proceedings.

9 I am unable to agree that the purpose of the creation of the documents would fall into this category. The copies would be made by the Australian Taxation Office in response to the request by the first defendant for copies of its own documents and that request would be made by the first defendant not for the sole or dominant purpose of use in legal proceedings, but for the sole or dominant purpose of complying with the order made by the Court, if such order is made. The copies would not therefore necessarily be privileged.

10 I propose therefore to make an order essentially as sought by the plaintiff.

11 I have been asked by Mr DeBuse to attach conditions to that order. The first condition that he seeks to attach is that the plaintiffs should reimburse the defendants for any fees they incur in obtaining the copy documents. This condition I consider reasonable and propose to attach.

12 The second condition sought by Mr DeBuse is for an opportunity to be given to the first defendant, after it has obtained copies of the documents, to apply to the Court to vary this order if, upon it seeing the documents, it appears they contain material which would justify a further claim for privilege or for resisting production. That also I consider a reasonable request and propose to incorporate it in the order.

13 It is put to me by Mr DeBuse that the appropriate order for costs should be that the costs of the application be the plaintiffs’ costs in the proceedings, because the representations may not ultimately be made out. This is, of course, the standard order made in respect of a successful application for an interlocutory injunction. However, I do not think that this application falls in the same category and the order that I propose to make is simply that the defendants should pay the plaintiffs’ costs of the application.

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LAST UPDATED:
21 August 2009