Cameron, Camille; Liberman, Jonathan --- "Destruction of Documents Before Proceedings Commence: What Is a Court to Do?" [2003] MelbULawRw 12; (2003) 27(2) Melbourne University Law Review 273
[*] BA (St Mary’s), LLB (New Brunswick), LLM (Cambridge); Associate Professor, Faculty of Law, The University of Melbourne.
[†] BA, LLB (Hons) (Monash); Legal Consultant, VicHealth Centre for Tobacco Control, The Cancer Council Victoria; Part-time PhD scholar, Law Program, Research School of Social Sciences, The Australian National University.
[1] [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) (‘BAT v Cowell’). The Court delivered a joint judgment.
[2] Huddart, Parker & Co Pty Ltd v Moorehead [1909] HCA 36; (1909) 8 CLR 330, 357 (Griffith CJ).
[3] Precision Data Holdings Ltd v Wills [1991] HCA 58; (1991) 173 CLR 167, 188 (Mason CJ, Brennan, Deane, Dawson, Toohey, Gaudron and McHugh JJ) (emphasis added).
[4] ‘[T]he process to be followed must generally be an inquiry concerning the law as it is and the facts as they are, followed by an application of the law as determined to the facts as determined’: R v Trade Practices Tribunal; Ex parte Tasmanian Breweries Pty Ltd [1970] HCA 8; (1970) 123 CLR 361, 374 (Kitto J).
[5] The term ‘documents’, when used in this article, picks up the broad definition that is now commonly used in courts. Section 38 of the Interpretation of Legislation Act 1984 (Vic) defines ‘document’, for the purposes of all Victorian statutes and subordinate legislation, to include not only a document in writing but also any book, map, plan, graph, drawing, photograph, descriptive label, and any disc, tape, soundtrack, film or other device from which data can be reproduced.
[6] See, eg, Supreme Court (General Civil Procedure) Rules 1996 (Vic) O 29.
[7] Precision Data Holdings Ltd v Wills [1991] HCA 58; (1991) 173 CLR 167, 188.
[8] Paul Matthews and Hodge Malek, Discovery (1992) 6.
[9] See, eg, J H Baker, An Introduction to English Legal History (3rd ed, 1990) ch 6; W J Jones, The Elizabethan Court of Chancery (1967).
[10] Matthews and Malek, above n 8, 6–7; Jones, above n 9, 455–7. Jones notes that discovery, along with recovery and restraint, accounted for the largest and one of the most important sections of Chancery business: at 455.
[11] Sir William Holdsworth, A History of English Law (first published 1924, 3rd ed, 1945) vol 5, 281.
[12] Edward Bray, The Principles and Practice of Discovery 1885 with Bray’s Digest of Discovery, 1910 (1985) 4.
[14] Flight v Robinson [1844] EngR 826; (1844) 8 Beav 22, 37; [1844] EngR 826; 50 ER 9, 15 (Lord Langdale MR) (emphasis added). The issue in dispute was whether various classes of documents were protected by legal professional privilege. The Court decided that some were so entitled, but ordered the defendant to disclose the remaining classes of documents to the plaintiff.
[15] Augustine Birrell, ‘Changes in Equity, Procedure, and Principles’ in Roy Mersky and Myron Jacobstein (eds), A Century of Law Reform: Twelve Lectures on the Changes in the Law of England during the Nineteenth Century (1901) 177, 186.
[16] Birrell describes the process of scraping the defendant’s conscience by requiring a party to answer interrogatories on oath ‘and such answer admitted ... some of your alleged facts and disputed others, and thus threw light on the real truth of the case’: ibid. Blackstone refers to the circumstances in which ‘a court of equity applies itself to [a party’s] conscience, and purges him upon oath with regard to the truth of the transaction’: Sir William Blackstone, Commentaries on the Laws of England (15th ed, 1809) vol 3, 436–7.
[17] Bray, above n 12, 1–2. Bray’s survey of cases reminds us that one of the chief purposes of discovery is to obtain admissions from parties of the case against them. This has both a truth-seeking and a time-saving function.
[18] Supreme Court of Judicature Act 1873 (Imp) 36 & 37 Vict, c 66; Supreme Court of Judicature Act (Imp) 38 & 39 Vict, c 77.
[19] Bernard Cairns, The Law of Discovery in Australia: Documents, Interrogatories and Property (1984) 1.
[20] There are many (some would say too many) examples of cases in which interlocutory discovery skirmishes have greatly increased the cost of litigation and delayed a consideration of the real issues in dispute. For a striking example, see B T (Australasia) Pty Ltd v New South Wales [1997] FCA 1553 (Unreported, Sackville J, 24 December 1997).
[21] Shane Simpson, David Bailey and Evan Evans, Discovery and Interrogatories (2nd ed, 1990) 2.
[23] Ibid 804 (emphasis in original).
[24] [2002] VSC 73 (Unreported, Eames J, 22 March 2002) (‘McCabe v BAT’).
[25] The plaintiff’s allegations included that the defendant ‘knew that cigarettes were addictive and dangerous to health, and by its advertising targeted children to become consumers’ and, ‘knowing the dangers of addiction and to health of consumers, took no reasonable steps to reduce or eliminate the risk of addiction or the health risks, and ignored or publicly disparaged research results which indicated the dangers to health of smoking’: ibid [7], adopted by the Court of Appeal in BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [20].
[26] McCabe v BAT [2002] VSC 73 (Unreported, Eames J, 22 March 2002) [385].
[27] Ibid.
[28] Ibid [324]. Eames J described ‘warehousing’ as the tactic of having third parties hold documents relevant to issues in the trial so that those documents would be available to be called on to rebut the plaintiff’s witnesses or to be used by the defendant’s witnesses, whilst not being required to be discovered by the defendant because they would be said not to be under its possession, custody or power.
[29] BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [1].
[30] Ibid [13], [192]. The decision was handed down approximately six weeks after the plaintiff passed away.
[31] On 25 July 2003, the Victorian Attorney-General, Rob Hulls, announced that he would seek leave to intervene in the plaintiff’s special leave application. The announcement followed allegations made in an affidavit by Mr Frederick Gulson, a former in-house counsel for W D & H O Wills Ltd (BAT’s predecessor), that the purpose behind BAT’s ‘document retention policy’ was to ‘get rid of all the sensitive documents but to do so under the guise of an innocent housekeeping arrangement and to ensure that all relevant documents that were not destroyed or removed from the jurisdiction were properly (legally) privileged’: see William Birnbauer, ‘Tobacco Insider Tells of Files “Cull”’, The Age (Melbourne), 19 July 2003, 1. On 1 August 2003, the Attorney-General welcomed the decision of the New South Wales government to intervene, noting that ‘[t]he fact that two major states are involved confirms that the case is of national significance and raises clear and important issues that go to the integrity of the legal system and its processes’: Rob Hulls, ‘Hulls Welcomes NSW Decision to Join Tobacco Case’ (Press Release, 1 August 2003).
[32] This article does not deal with the other major issues dealt with by the Court of Appeal, including whether the defendant had impliedly waived privilege over certain documents and what should follow from the defendant’s specific failures to comply with orders for discovery. The approach adopted by the Court of Appeal treated questions relating to the pre-proceedings destruction of documents as independent of these other issues.
Eames J had been careful to base his striking out of the defence on grounds that included — but were not limited to — the destruction of documents. However, after the Court of Appeal had overturned a number of his Honour’s findings and conclusions relating to these other grounds, it considered the pre-proceedings destruction of documents as a discrete issue. This approach conveniently isolated and identified a fundamental issue of principle requiring resolution. In particular, the Court’s articulation of the relevant principles was not affected by the question whether particular documents ought to have been admissible over the defendant’s claim of privilege.
[33] BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [26]; McCabe v BAT [2002] VSC 73 (Unreported, Eames J, 22 March 2002) [61].
[34] BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [136]; McCabe v BAT [2002] VSC 73 (Unreported, Eames J, 22 March 2002)
[127]–[128].
[35] BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [136].
[36] McCabe v BAT [2002] VSC 73 (Unreported, Eames J, 22 March 2002) [289].
[37] Ibid. When the Cremona and Harrison cases (David Harrison had commenced proceedings in the Supreme Court of New South Wales in 1991) were discontinued in March 1998, it marked the first time since 1990 that no litigation against the defendant concerning smoking-related disease was on foot in any Australian jurisdiction: at [58]–[59].
[38] Ibid [289].
[39] BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [140] (citations omitted).
[40] The defendant argued that the only consequence which might follow in the proceeding from the destruction of documents in these circumstances was the drawing of adverse inferences against it. That is to say that inferences might be drawn, in appropriate circumstances, to the effect that the documents that had been destroyed would not have been helpful to the defendant’s case. Because Eames J had struck the defence out, the issue before the Court of Appeal related to the correctness of the striking out. Accordingly, the question relevant to the Court of Appeal related to intervention ‘beyond the drawing of adverse inferences’, as the Court described it: ibid [175].
[41] Ibid (emphasis in original). See also the Court’s statement, in similar terms (at [173]) (citations omitted):
As indicated at the outset, it seems to us that there must be some balance struck between the right of any company to manage its own documents, whether by retaining them or destroying them, and the right of the litigant to have resort to the documents of the other side. The balance can be struck, we think, if it be accepted that the destruction of documents, before the commencement of litigation, may attract a sanction (other than the drawing of adverse inferences) if that conduct amounts to an attempt to pervert the course of justice or (if open) contempt of court, meaning criminal contempt (inasmuch as civil contempt comprises wilful disobedience of a court order and will ordinarily be irrelevant prior to the commencement of proceedings). ... Certainly, there can be an attempt to pervert the course of justice before a proceeding is on foot, as R v Rogerson demonstrates, and that, we think, provides a satisfactory criterion in the present instance. The standard of proof is the civil rather than the criminal standard, bearing in mind also the seriousness of the allegation as required by Dixon J in Briginshaw v Briginshaw.
[42] Precision Data Holdings Ltd v Wills [1991] HCA 58; (1991) 173 CLR 167, 188. See the earlier discussion of judicial power in Part I.
[43] BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [136].
[44] Arthur Delbridge et al (eds), Macquarie Dictionary (3rd revised ed, 2001) 1321.
[45] Ibid 1606.
[46] That the Court viewed the issue as one of obligation is confirmed by further statements in BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002): ‘for the moment we are dealing only with whether a company, in the position of the defendant, is obliged to retain documents when litigation is not on foot but can be anticipated’: at [141]; ‘we turn to the critical question, whether there is any obligation on the defendant, before the commencement of proceedings, not to destroy documents which might well be relevant in future litigation when such litigation can reasonably be anticipated’: at [142]; and in its conclusion: ‘Nor, in our view, was the defendant shown to be in breach of any relevant obligation not to destroy documents before the commencement of the proceeding, given that the plaintiff did not rest her case on either an attempt to pervert the course of justice or contempt of court’: at [191].
[47] Ibid [173]. The Court later stated (at [175]) (italics in original, underlining added):
Accordingly, there being no authority directly in point, we consider that this court should state plainly that where one party alleges against the other the destruction of documents before the commencement of the proceeding to the prejudice of the party complaining, the criterion for the court’s intervention (otherwise than by the drawing of adverse inferences, and particularly if the sanction sought is the striking out of the pleading) is whether that conduct of the other party amounted to an attempt to pervert the course of justice or, if open, contempt of court occurring before the litigation was on foot.
[48] Delbridge et al, above n 44, 1672.
[49] The Court said in BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) that ‘there must be some balance struck between the right of any company to manage its own documents, whether by retaining them or destroying them, and the right of the litigant to have resort to the documents of the other side’: at [173].
[50] Delbridge et al, above n 44, 1625.
[51] See, eg, the discussion of the Ford Pinto case in David Luban, Lawyers and Justice: An Ethical Study (1988) 206–10.
[52] In the absence, that is, of independent proceedings brought to punish the defendant for the destruction.
[53] It may be that the consequences resulting from the destruction of documents are likely to be more adverse to the defendant in McCabe v BAT than to the hypothesised defendant here — eg, because there is likely to be more than one plaintiff and/or damages are likely to be large in amount. But numbers of prospective plaintiffs or amounts of likely damages cannot make any substantive difference to matters of principle. These simply define the consequences of the defendant’s decision to manage its own documents in certain ways; they do not evidence denial or restriction of its right to do so.
[54] See above Parts I and II(A).
[55] Crimes Act 1958 (Vic) s 320.
[56] Level two offences carry a maximum penalty of 3000 penalty units, where one penalty unit equates to $100: Sentencing Act 1991 (Vic) ss 109(2), 110.
[57] [1992] HCA 25; (1992) 174 CLR 268 (‘Rogerson’).
[58] S G Mitchell, P J Richardson and D A Thomas, Archbold: Criminal Pleading, Evidence and Practice (43rd ed, 1988) vol 2, 2463.
[59] [1992] HCA 25; (1992) 174 CLR 268, 303.
[60] (1995) 184 CLR 132 (‘Meissner’).
[61] Ibid 156, citing P J Richardson (ed), Archbold: Criminal Pleading, Evidence and Practice (44th ed, 1992) vol 2, [28-118].
See also R v McLachlan [1998] 2 VR 55, in which Byrne J explained both the actus reus (at 59) and the mens rea (at 67) of the offence of criminal contempt in terms used for an attempt to pervert the course of justice; DPP v Johnson [2002] VSC 583 (Unreported, Osborn J, 20 December 2002) [9].
It might be argued that the offence of attempting to pervert the course of justice requires an intent that is not required for contempt: see Lane v Registrar of Supreme Court of New South Wales [1981] HCA 35; (1981) 148 CLR 245, 258 (Gibbs CJ, Mason, Murphy, Wilson and Brennan JJ); Hinch v A-G (Vic) [1987] HCA 56; (1987) 164 CLR 15, 46–7 (Deane J), 69–70 (Toohey J), 85 (Gaudron J); A-G (NSW) v Dean (1990) 20 NSWLR 650, 655–6 (Gleeson CJ, Kirby P and Priestley JA). The better view seems to be that whether or not a particular intent is required for contempt of court will depend on the type of contempt. In cases of publication by the media of material that has a tendency to interfere with the administration of justice by impairing the capacity of a party to obtain a fair trial, ordinarily it will not need to be shown that the publisher intended to interfere with the administration of justice: see, eg, Hinch v A-G (Vic) [1987] HCA 56; (1987) 164 CLR 15; A-G (NSW) v Dean (1990) 20 NSWLR 650. But for other types of contempt, such as contact between a party and a witness or potential witness, an intention to interfere with the administration of justice may be required. In R v McLachlan [1998] 2 VR 55, Byrne J held that the prosecution in such a case ‘must establish to the criminal standard that the alleged contemnor had at the relevant time, an intention to pervert the course of justice’: at 67. His Honour drew (at 67–8) on Meissner and Rogerson — cases in which the accused were charged with attempting to pervert the course of justice, in relation to which the relevant intent is clearly required — to explain the nature of the mens rea required for the conviction of the accused in the case before him on the charge of contempt of court. In a subsequent case, A-G (Vic) v Rich [1998] VSC 41 (Unreported, Byrne J, 21 August 1998), his Honour doubted whether the court ‘should be concerned with an inquiry as to what was the actual purpose of the contemnor’, though he found it unnecessary to express a concluded view on the controversy: at [16]. See also A-G v Butterworth [1963] 1 QB 696, 723 (Lord Denning MR), 725–6 (Donovan LJ); Deen, Decentius v Stronghearts Pty Ltd (1998) 8 Tas R 432 (Slicer J); Prothonotary v Hirata [2000] NSWSC 106 (Unreported, James J, 10 March 2000).
Where conduct is of the kind described here (ie, destruction of relevant material) and both offences would appear to apply, and where the offence of attempting to pervert the course of justice would require an intent to interfere with the administration of justice, the arguments in favour of requiring such an intention for contempt of court will be strong. Otherwise, the offence of attempting to pervert the course of justice would be redundant in relation to the very sort of conduct to which one would expect it typically to apply.
[62] In Rogerson [1992] HCA 25; (1992) 174 CLR 268, 277, Mason CJ said:
It is well established at common law and under cognate statutory provisions that the offence of attempting or conspiring to pervert the course of justice at a time when no curial proceedings are on foot can be committed. That is because action taken before curial or tribunal proceedings commence may have a tendency and be intended to frustrate or deflect the course of curial or tribunal proceedings which are imminent, probable or even possible.
See also at 281 (Brennan and Toohey JJ), 305 (McHugh J).
Note that the Court of Appeal expressed some doubt as to whether contempt of court could apply before proceedings have been instituted but found the issue unnecessary to examine. Their Honours stated that ‘[c]ertainly, there can be an attempt to pervert the course of justice before a proceeding is on foot, as R v Rogerson demonstrates, and that, we think, provides a satisfactory criterion in the present instance’: BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [173] (citations omitted).
[63] See below n 71 and accompanying text.
[64] [1992] HCA 25; (1992) 174 CLR 268, 278.
[65] Ibid 280.
[66] Ibid (emphasis added).
[67] Ibid 284. Where a party’s dealings with its documents may interfere with ‘the due exercise of jurisdiction by courts’, its ‘right’ to manage its documents is restricted by the law, and a criminal sanction is imposed for contravention.
[68] BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [173] (citations omitted).
[69] Save for a reference (‘See also’) to Meissner in a footnote to Rogerson: BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) fn 215.
[70] [1992] HCA 25; (1992) 174 CLR 268.
[71] Ibid 275–6. See also 279 (Brennan and Toohey JJ); Meissner (1995) 184 CLR 132, 141 (Brennan, Toohey and McHugh JJ), 156–7 (Dawson J).
[72] ‘It is the tendency of the conduct which is decisive and it is irrelevant whether the conduct did or did not bring about a miscarriage of justice’: Rogerson [1992] HCA 25; (1992) 174 CLR 268, 298 (McHugh J). See also Meissner (1995) 184 CLR 132, 156–7 (Dawson J).
The focus on tendency rather than actual effect also applies in the case of contempt by publication of matter that may interfere with a trial: see, eg, Hinch v A-G (Vic) [1987] HCA 56; (1987) 164 CLR 15, 34 (Wilson J) where his Honour said that contempt of court will be made out ‘only if it is made quite clear to the court that the matter published has, as a matter of practical reality, a tendency to interfere with the due course of justice. The impugned material must exhibit a real and definite tendency to prejudice or embarrass pending proceedings.’ See also Deane J’s use of the phrases ‘“clear tendency” to interfere adversely with the due administration of justice’ and ‘as a matter of practical reality’: at 47.
[73] See discussion in above n 61.
[74] Precision Data Holdings Ltd v Wills [1991] HCA 58; (1991) 173 CLR 167, 188. See the discussion in above Part I. The fact that the court should be concerned only with the effect of the destruction of documents in the case it is adjudicating does not mean that it must turn a blind eye to conduct it considers worthy of investigation or punishment. For example, the court may instruct the Prothonotary to bring proceedings for contempt (see Supreme Court (General Civil Procedure) Rules 1996 (Vic) r 75.07) or refer matters that come to its notice to the Director of Public Prosecutions.
[75] BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [174], [191].
[76] Ibid [172].
[77] McCabe v BAT [2002] VSC 73 (Unreported, Eames J, 22 March 2002) [377].
See also Eames J’s other references to the issues of fairness of the trial: ‘I have concluded that the defendant’s actions have caused prejudice to the plaintiff and denied her a fair trial’: at [372];
I do not consider that prejudice could have been removed entirely were the trial to proceed and were I [to] make attempts, as discussed above, to ameliorate the prejudice suffered by the plaintiff. That being so, I have concluded that it would be an inappropriate course to adopt, to permit the trial to proceed, whether or not such a trial was by jury or by judge alone.
At [378];
The fact that the plaintiff might well overcome the prejudice to a fair trial which the defendant has created is no answer, in my opinion, to this application. Success under those circumstances would merely demonstrate that the plaintiff’s claim had merit. The defendant’s decision to destroy documents was predicated on the fact that a claim brought by a plaintiff at a later time might well have merit and could succeed unless steps were taken to deny a fair trial to the plaintiff. Failure of a claim where a plaintiff had been denied a fair trial, could never be shown to be a just result.
At [379].
[78] American authorities were also discussed, mainly in the context of the tort of spoliation. That tort was rejected as having no relevance in Australia and the cases were not relied on. Those authorities are therefore not discussed in this article.
[79] (Unreported, English Court of Appeal, Judge LJ and Lord Lloyd, 20 October 1999).
[80] Ibid 3.
[81] Ibid 2 (emphasis added). See also Judge LJ’s comment (at 3): ‘She [the trial judge] decided that the missing documents went to the core of the plaintiff’s case and that the deficiencies in discovery could not now be made good. Therefore she held that a fair trial was not possible’.
[82] [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [149].
[83] (Unreported, English High Court of Justice, Millett J, 5 February 1988) (‘Logicrose’).
[84] Ibid 1.
[85] Ibid 1–2.
[86] BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [150].
[87] Ibid [151].
[88] Compare this to the emphasis given by the Court of Appeal (ibid [150]) to the sentence from Logicrose: ‘But to debar the offender from all further part in the proceedings and to give judgment against him accordingly is not an appropriate response by the Court to contempt.’ This sentence was italicised in the Court of Appeal’s judgment, suggesting that the Court found it particularly significant, notwithstanding that Millett J’s next sentence, as reproduced by the Court of Appeal (at [150]), said:
It may, however, be an appropriate response to a failure to comply with the rules relating to discovery, even in the absence of a specific order of the Court, and so in the absence of any contempt, not because that conduct is deserving of punishment but because the failure has rendered it impossible to conduct a fair trial or would make any judgment in favour of the offender unsafe.
[89] (Unreported, English Court of Appeal, Lloyd and Farquharson LJJ and Sir John Megaw, 14 May 1991).
[90] Ibid 2.
[91] Ibid 7.
[92] BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [157].
[93] Landauer Ltd v Comins & Co (Unreported, English Court of Appeal, Lloyd and Farquharson LJJ and Sir John Megaw, 14 May 1991) 12, cited in BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [156].
[94] [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [157].
[95] [2000] EWCA Civ 200; [2000] 2 BCLC 167 (‘Arrow Nominees’).
[96] Ibid 193.
[97] Ibid 193–4.
[98] Ibid 194.
[99] [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [160].
[100] Arrow Nominees [2000] EWCA Civ 200; [2000] 2 BCLC 167, 195.
[101] [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [172] (emphasis added).
[102] The Court’s approach was made complete when it concluded that none of the prejudice suffered by the plaintiff as a result of the destruction of documents mattered at all unless the defendant had been shown to have breached an ‘obligation’ with respect to those documents. The Court referred to Eames J’s view that the prejudice from the destruction of documents was ‘very considerable’, and then listed a number of aspects of prejudice that his Honour had identified: ‘the prejudice to the plaintiff might be immense by virtue of the deliberate destruction of just one document, which might have been decisive in her case’; it would ‘be interesting to know ... how many of the Cremona documents had been rated 5 (a “knockout” blow for the plaintiff) and how many of those had been discovered in this case’; and ‘the plaintiff’s anxiety that she may have been denied at least one “knockout” document, if not many’: McCabe v BAT [2002] VSC 73 (Unreported, Eames J, 22 March 2002) [309].The Court said ‘[t]hese comments lose significance if, as already concluded, the defendant was not shown to have been in breach of any obligation in destroying documents before the commencement of this proceeding — or, more accurately, any relevant obligation as the matter was argued’: BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [185].
[103] See above Part I.
[104] See above Part II.
[105] See above Part I.
[106] Coleman v Dunlop Ltd (Unreported, English Court of Appeal, Judge LJ and Lord Lloyd, 20 October 1999) 2 (Judge LJ).
[107] Logicrose (Unreported, English High Court of Justice, Millett J, 5 February 1988) 10.
[108] Ibid 1.
[109] Ibid 2.
[110] Landauer Ltd v Comins & Co (Unreported, English Court of Appeal, Lloyd and Farquharson LJJ and Sir John Megaw, 14 May 1991) 4.
[111] Arrow Nominees [2000] EWCA Civ 200; [2000] 2 BCLC 167, 195 (Chadwick LJ).
[112] Ibid 194.
[113] The Court of Appeal expressed concerns about the use of ‘fair trial’ as a criterion for intervention. In doing so, it drew on the comments of McHugh J in Perre v Apand Pty Ltd [1999] HCA 36; (1999) 198 CLR 180, 211–12 and Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1, 40–1: ‘McHugh J has been very critical, more than once, of the concept of “fairness” standing as a criterion ... The concept of “fair trial”, particularly when divorced from the way in which a current proceeding is being conducted, is surely capable of attracting like criticism’: BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) fn 210.
However, when McHugh J’s comments in these two cases are considered, in neither case do they provide support for the Court of Appeal’s concerns.
In Perre v Apand Pty Ltd [1999] HCA 36; (1999) 198 CLR 180, McHugh J was cautioning against the use of such notions as fairness, justice and morality as criteria for imposing a duty of care in a negligence context as this would not help the negligence doctrine ‘escape the charge of being riddled with indeterminacy’: at 212. But the idea of fairness here is a far cry from what it means in the context of a ‘fair trial’. In the former, the concern is of the indeterminate notion of fairness being used as a criterion according to which the outcome is to be determined. In the latter, fairness is as to the nature of the processes to be followed, and is essentially used in a procedural sense: and, of course, the notion of procedural fairness is well-known to the law.
In Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1, McHugh J was not, in fact, critical of fairness as a criterion in all circumstances. His Honour, dealing with the issue of waiver of privilege, distinguished between two categories of waiver: implied waiver, where it may be ‘unfair’ for a party to partially disclose privileged material and mislead by removing that material from its context, and waiver by disclosure of material to a third party. His Honour thought that the notion of fairness was relevant to the former category of waiver (‘In such a case, there is a clear potential for unfairness arising out of the capacity of disclosed material — which is part of an undisclosed whole — to mislead by reason of it being removed from its context’: at 34) but not to the latter. His Honour was not critical of the concept of fairness being used as a criterion per se, but of it being used in a particular context in which it was irrelevant. His Honour explained (at 35–9) why he thought that a fairness test of waiver ‘in the context of determining whether voluntary disclosure by A to B entitles A to assert privilege in the disclosed material as against C’ is contrary to, or not supported by, the rationales of legal professional privilege: at 35 (emphasis added), but immediately distinguished this category of case from that of partial disclosure.
Where documents have been destroyed by a party in anticipation of litigation, in such a manner as to prejudice the capacity of the other party to obtain a fair trial, the situation is much more closely analogous to a partial disclosure case. After all, the inevitable impact is a trial (if it proceeds) in which only part of the ‘undisclosed whole’ is made available to the other party and to the court. It is not a case of ‘general’ concepts of unfairness as between the parties in dispute, but the specific unfairness of a trial in which only part of the relevant evidence is available. In the authors’ view, McHugh J’s reasoning, when analysed, would actually support the use of the notion of ‘fairness’ as a highly relevant factor in circumstances where relevant material is unavailable to the decision-maker, at least where it is unavailable as a result of the deliberate actions of one of the parties.
[114] See the classic exposition by Sir Jack Jacob, ‘The Inherent Jurisdiction of the Court’ (1970) 23 Current Legal Problems 23, 27.
[115] Ibid.
[116] Bremer Vulkan Schiffbau und Maschinenfabrik v South India Shipping Corporation Ltd [1981] AC 909, 997.
[117] Hamilton v Oades [1989] HCA 21; (1989) 166 CLR 486, 502 (Deane and Gaudron JJ).
[118] (1993) 177 CLR 378.
[119] (1993) 177 CLR 378, 393, citing Hunter v Chief Constable of the West Midlands Police [1981] UKHL 13; [1982] AC 529, 536 (Lord Diplock). See also Hamilton v Oades [1989] HCA 21; (1989) 166 CLR 486, 502 (Deane and Gaudron JJ); Simsek v Macphee (1982) 148 CLR 636, 640 (Stephen J); Jago v District Court of NSW [1989] HCA 46; (1989) 168 CLR 23, esp 25–6, 30–1 (Mason CJ), 71 (Toohey J), 74 (Gaudron J).
See Eames J’s various references to the inherent power of the court in McCabe v BAT [2002] VSC 73 (Unreported, Eames J, 22 March 2002) [338], [339], [346], [360] and his statement (at [367]) that:
In my opinion, the rules relating to discovery which I have cited, above, are not so inadequate, and the inherent powers of the Court are not so deficient, that, in the event that no alternative course is reasonably open to remove the unfairness, the court must require a plaintiff to participate in an unfair trial and seek to obtain a verdict, in those circumstances, against a defendant whose actions rendered the trial unfair.
See also Supreme Court (General Civil Procedure) Rules 1996 (Vic) r 24.05 entitled ‘Inherent Jurisdiction’, which provides:
Nothing in this Order [Judgment on Failure to Prosecute or Obey Order for Particulars or Discovery] shall affect the inherent power of the Court to dismiss any proceeding for want of prosecution or to order that upon the failure of a party to do any act or [to] take any step which under these Rules he is required to do or take or to comply with an order that he do any such act or take any such step the proceeding shall be dismissed or the defence struck out and that judgment may be entered or that there be judgment accordingly.
Though the rule refers only to the dismissal of a proceeding or the striking out of a defence ‘upon the failure of a party to do any act or [to] take any step which under these Rules he is required to do or take or to comply with an order that he do any such act or take any such step the proceeding’, it should not be read as restricting the court’s inherent power to intervene to the circumstances described in the rule.
[120] In such cases, the court may intervene not only by way of its inherent jurisdiction, but also under r 24.02 of the Supreme Court (General Civil Procedure) Rules 1996 (Vic), which provides that the court may dismiss a pleading or strike out a defence where a party fails to comply with an order for the discovery of documents.
The Court of Appeal’s apparent lack of regard for the fact that not only had documents been destroyed, but also records of the documents destroyed, is especially surprising in light of the requirements of Supreme Court (General Civil Procedure) Rules 1996 (Vic) r 29.04. The Court referred to Eames J’s finding that ‘[n]o record was kept, and deliberately so, as to what documents had been destroyed’: BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [106], citing McCabe v BAT [2002] VSC 73 (Unreported, Eames J, 22 March 2002) [289]. The Court thought that ‘such conduct was surely no more than a reflection of the warning given in the manual in use at the conference at Kuala Lumpur [on records management]’: at [106]. That warning was that there was ‘no point in disposing of a paper record only to find that the same record is still being kept on a computer file or word processing disc’: at [103]. The Court said (at [103]):
So much was surely self-evident and unexceptionable. The sting, for the judge, lay in the tail [of the warning]: ‘especially if you have a discovery order served on your Company by a court’. But given that the discovery for any large business organisation was likely to be a most onerous task and one not lightly to be encouraged, the sting is no sting at all. It is self-evident. It does not bespeak illegitimate purpose, although it plainly demonstrates an awareness of the problem.
See also the Court’s response to Eames J’s findings that not only had hard copies of documents been destroyed, but also CD-ROMs on which some 30 000 documents had been imaged before destruction. The Court said (at [109]) (emphasis added) (citations omitted) that
this may be seen to reflect, yet again, the warning mentioned in paragraph [103], that there is not much point in destroying the hard document only to keep a record on computer if, as we think was the case, one at least of the problems facing the defendant in litigation was the magnitude, expense and complexity of meeting any notice for general discovery. As will be seen shortly, the Cremona litigation had demonstrated the difficulties and it was surely not surprising that, given that experience, the defendant, when destroying documents in March 1998, was at pains to destroy also the computer imaging of the documents being destroyed. But again the point is peripheral on this appeal; for while it is a question whether the destruction of documents generally constitutes a breach of a defendant’s obligations though litigation is yet to be commenced, the answer to that question is not affected by the failure to keep a record of what is destroyed. It adds nothing save emphasis to the breach, if such it be; and if it be not a breach it adds nothing at all.
Though the authors have argued throughout this article that the issue is not to be framed in terms of ‘a defendant’s obligations’ with respect to the retention or destruction of documents, the deliberate destruction also of the records of the documents destroyed must be a highly relevant factor under any approach, given the requirements of Supreme Court (General Civil Procedure) Rules 1996 (Vic) r 29.04. See BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [139] where the Court, early in the section of its judgment dealing with the destruction of documents, assumed, for the purposes of its reasoning, that no record was kept of what was destroyed in the ‘period of frantic activity’ following the lifting of the hold order in March 1998.
[121] The Court of Appeal in BAT v Cowell [2002] VSCA 197 (Unreported, Phillips, Batt and Buchanan JJA, 6 December 2002) [186]–[190] criticised Eames J on the ground that his Honour had failed to sufficiently relate the destruction of documents in question to the issues raised in the proceeding before him. The Court identified certain issues which it said the plaintiff should not have been relieved of the burden of having to prove, including that she smoked cigarettes, and that she smoked the defendant’s cigarettes. The Court said (at [188]):
The remedy should have been related more directly to the prejudice seen to have been suffered. With respect, the remedy adopted was out of proportion to the wrong, even if the judge’s criticisms of the defendant’s conduct, both in relation to the order for discovery and the destruction of documents more generally, were to be accepted.
In the authors’ view, such an exercise (ie, relating the remedy to the prejudice) ought to be performed by a court deciding these matters. Eames J performed such an exercise: McCabe v BAT [2002] VSC 73 (Unreported, Eames J, 22 March 2002) [290]–[322],
[370]–[379]. See, in particular, his Honour’s conclusion (at [378]):
I do not consider that prejudice could have been removed entirely were the trial to proceed and were I [to] make attempts, as discussed above, to ameliorate the prejudice suffered by the plaintiff. That being so, I have concluded that it would be an inappropriate course to adopt, to permit the trial to proceed, whether or not such a trial was by jury or by judge alone.
If the Court’s view was that Eames J had gone too far, it ought to have carefully considered how far he ought to have gone, rather than evading the question entirely on the ground that the commission of a criminal offence had not been proved.
[122] Though the authors have spoken throughout this article of the court’s capacity to strike out a defence, or parts of a defence, in the circumstances we have described, we do not mean to foreclose the possibility of courts adopting other, perhaps more creative, means of intervention. One possibility is that a court may reverse the onus of proof in relation to specific allegations to which the unavailable material is relevant. While we have not found authority for such an approach, we note the statement of Lord Maugham in Joseph Constantine Steamship Line Ltd v Imperial Smelting Corporation Ltd [1941] 2 All ER 165, 179 (emphasis added):
the burden of proof in any particular case depends on the circumstances in which the claim arises. In general the rule which applies is Ei qui affirmat non ei qui negat incumbit probatio (the burden of proof lies on him who affirms, not on him who denies). It is an ancient rule founded on considerations of good sense and should ... not be departed from without strong reasons.
Perhaps the destruction of relevant material by a defendant in anticipation of litigation provides ‘strong reasons’ for a court to depart from the traditional approach in an effort to do justice between the parties whose ‘controversies’ in relation to ‘rights relat[ing] to life, liberty or property’ it is charged with deciding: Huddart, Parker & Co Pty Ltd v Moorehead [1909] HCA 36; (1909) 8 CLR 330, 357 (Griffith CJ).
[123] McCabe v BAT [2002] VSC 73 (Unreported, Eames J, 22 March 2002) [376].
[124] Ibid.
[125] In criminal law, the destruction of evidence by an accused may, in certain circumstances, lead to an inference of ‘consciousness of guilt’, and the ‘guilty mind’ lead to an inference of guilt of the offence charged: see Andrew Palmer, ‘Guilt and the Consciousness of Guilt: The Use of Lies, Flight and Other “Guilty Behaviour” in the Investigation and Prosecution of Crime’ [1997] MelbULawRw 3; (1997) 21 Melbourne University Law Review 95. In such a context, inferences are drawn from the destruction of evidence, rather than the accused person’s defence to the prosecution, or parts of the defence, being struck out.
The rationale for the difference in approach lies in the fundamental difference between civil and criminal proceedings. In criminal proceedings, the court is charged with deciding whether the prosecution, representing the state, has established, beyond reasonable doubt, that the accused is guilty of the offence charged, with punishment to follow from a finding of guilt. The finding of guilt, and its consequences (including the potential deprivation of liberty) are such grave matters that they may be imposed only where commission of the offence charged is proved. The destruction of evidence may be suggestive of guilt (and care must be taken in so finding in a particular case), but it cannot be used to supplant the need to prove guilt. A civil proceeding, however, does not look at whether a party has committed an offence against the state (and the community as a whole) that is worthy of punishment, but at the resolution of controversies between parties in relation to their rights and obligations. The notion of doing justice varies with the essence of the proceedings. Where one party destroys evidence in a civil proceeding, care must be taken to ensure that the prejudiced party is not left without an adequate remedy. Further, in the case of a criminal prosecution, the state will ordinarily be in a strong position to take action against the accused in relation to the destruction of evidence, such as through a prosecution for the very serious offence of attempting to pervert the course of justice. Any ‘loss’ suffered by the state as a result of the destruction of evidence of an accused is different in nature from the loss suffered by a party to a civil proceeding where the other destroys evidence. Where loss is different in nature, the appropriate remedy will ordinarily be different, too.
Chris Haan has reminded us that, in the criminal context, destruction of evidence by the prosecution may well lead to the staying of proceedings. The staying of criminal proceedings is perhaps analogous to the striking out of a pleading in civil proceedings. Without engaging in a detailed discussion of the different, as well as common, issues that are involved, the important point to make is that the appropriate response varies in accordance with the task the court is performing and the various public interests at stake.