Australian Reliance Group Pty Ltd v Coverforce Insurance Brokers Victoria Pty Ltd [No 3]

[2017] WASC 60 (S)

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   AUSTRALIAN RELIANCE GROUP PTY LTD -v- COVERFORCE INSURANCE BROKERS VICTORIA PTY LTD [No 3] [2017] WASC 60 (S)

CORAM:   CHANEY J

HEARD:   ON THE PAPERS

DELIVERED:   13 APRIL 2017

FILE NO/S:   COR 35 of 2016

BETWEEN:   AUSTRALIAN RELIANCE GROUP PTY LTD

Plaintiff

AND

COVERFORCE INSURANCE BROKERS VICTORIA PTY LTD
First Defendant

BYRON DREAMING PTY LTD (as Trustee for the Malady Family Trust)
Second Defendant

SUN DEVIL INVESTMENTS PTY LTD (as Trustee for the JG Neate Family Trust)
Third Defendant

ROBERT CARLTON HOWARTH (as Trustee for the Howarth No.1 Trust)
Fourth Defendant

COVERFORCE VICTORIA HOLDINGS PTY LTD
Fifth Defendant

Catchwords:

Practice and procedure - Inspection of documents - Court knew of documents - Whether documents should be made available for inspection

Legislation:

Nil

Result:

Documents for inspection identified

Category:    B

Representation:

Counsel:

Plaintiff:     Mr M A Maclennan & Mr A J Tharby

First Defendant              :     Mr J A Thomson SC & Mr J E Scovell

Second Defendant         :     Mr J A Thomson SC & Mr J E Scovell

Third Defendant            :     Mr J A Thomson SC & Mr J E Scovell

Fourth Defendant           :     Mr J A Thomson SC & Mr J E Scovell

Fifth Defendant              :     Mr J A Thomson SC & Mr J E Scovell

Solicitors:

Plaintiff:     Bennett + Co

First Defendant              :     Gilbert + Tobin

Second Defendant         :     Gilbert + Tobin

Third Defendant            :     Gilbert + Tobin

Fourth Defendant           :     Gilbert + Tobin

Fifth Defendant              :     Gilbert + Tobin

Case(s) referred to in judgment(s):

Nil

1. CHANEY J:  In reasons for decision published on 13 March 2017, I concluded that there should be inspection by the plaintiff of the documents discovered by the first and second defendants, and by the fifth defendant, in respect of which privilege had been claimed where those document deal with, or are relevant to, the question as to whether or not the second, third and fourth defendants, or any of them, were in breach of the shareholders agreement, or whether the plaintiff was in default of the shareholders agreement.  Following delivery of those reasons, I invited the defendants to identify any documents in respect of which a claim for privilege had been made which they considered did not relate to the questions which I had identified.  In response to that invitation, the defendants' solicitors notified the court by email dated 30 March 2017 of the documents in respect of which they considered privilege had not been waived.

2. The documents notified in relation to the first and second defendant's discovery were those documents numbered 2, 6, 7, 27, 28, 48, 57, 58, 60, 64, 65 and 74 of the documents identified in the list of documents attached to the affidavit of Dennis James Malady sworn 20 July 2016.  In relation to the fifth defendant's discovery, the documents notified were documents numbered 17, 20, 40, 42, 52 and 60 of the documents identified in the list of documents attached to the affidavit of Kasey Richmond sworn 15 July 2016 (together the notified documents).

3. I have now reviewed the notified documents.  I am satisfied that documents 2, 6 and 7 in Mr Malady's list relate to matters other than the issues in respect of which privilege was waived.  The claim to privilege in relation to those documents should be upheld, and inspection of those documents should not be ordered.

4. Having reviewed documents 27, 28, 48 and 57, I consider that those documents are relevant to whether ARG was in breach of the shareholders agreement and inspection should be ordered.  In respect of documents 58, 60, 64 and 65, the basis of the claim for privilege is not apparent, and those documents should be made available for inspection.

5. In relation to document 74, I received advice from the defendants' solicitors on 31 March 2017 that that document had been produced in the proceedings by a third party under subpoena, and thus it was accepted that privilege had been waived.

6. In relation to the documents discovered by the fifth defendant, having reviewed documents 17, 20, 40 and 42, I am of the view that those matters are relevant to the question of the lawfulness of the proposed sale of shares by the second, third and fourth defendants to Coverforce, and on that basis should be disclosed.  Documents 52 and 60 are draft documents prepared by Minter Ellison for the fifth defendant.  They are privileged in the hands of the fifth defendant.  They are not, in my view, relevant to any question of breach of the shareholders agreement by the second, third and fourth defendants, and the privilege should be maintained.

7. The parties should file a minute of orders to reflect these reasons.