Blue and Blue
[2007] FamCA 1444
•14 December 2007
FAMILY COURT OF AUSTRALIA
| BLUE & BLUE | [2007] FamCA 1444 |
| FAMILY LAW – PRACTICE AND PROCEDURE – Application – Dismissal – Disclosure of information |
| Family Law Act 1975 (Cth) |
| APPLICANT: | Ms Blue |
| RESPONDENT: | Mr Blue |
| FILE NUMBER: | BRF | 3188 | of | 2005 |
| DATE DELIVERED: | 14 December 2007 |
| PLACE DELIVERED: | Brisbane |
| PLACE HEARD: | Brisbane |
| JUDGMENT OF: | Justice Carmody |
| HEARING DATE: | 18 November 2007 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr North of Counsel leading Ms Brasch of Counsel |
| SOLICITOR FOR THE APPLICANT: | Mr R. Hirst Hirst and Company |
| SOLICITOR FOR THE RESPONDENT: | Mr G. Wilson Hopgood Ganim |
Orders
That paragraphs (2) and (3) of the Application in a Case filed on 27th August 2007 be dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Blue & Blue is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)
| FAMILY COURT OF AUSTRALIA AT BRISBANE |
FILE NUMBER: BRF 3188 of 2005
| MS BLUE |
Applicant
And
| MR BLUE |
Respondent
REASONS FOR JUDGMENT
Introduction
This is the adjourned hearing of two Form 2’s filed by the Wife on 27th August 2007 and 30th October 2007 and the return date of the Husband’s further amended Form 2A filed 16th November 2007.
The interim applications are made in the context of a complex property settlement case involving a pool in the order of $5 million and a network of corporate and trust structures involved in property development.
The first application seeks orders in five separate categories including costs. Of those only the second and third are left to be decided. They relate to disclosure of a litigation funding application and the issue of a mandatory injunction.
All other applications and cross-applications have been resolved by agreement.
The litigation funding privilege question
There are two related controversies for adjudication under this heading. The first question is whether or not the husband’s loan application for funding of his legal fees and charges in connection with this litigation is a document protected against disclosure by client-legal privilege. The protection, if any, belongs to and can only be surrendered by him. The next issue is whether any privileged contents of the document have been waived.
Senior Counsel for the wife, Mr North SC, argues that the inclusion in a third party document of information that might otherwise attract privilege does not make that document itself a privileged communication but may have the practical effect, whether intended or not, of removing the protection of the privilege from any confidential client lawyer communication it contains under the doctrine of implied waiver.
However, he quite rightly concedes that there was no inconsistency of conduct between the disclosure and the purpose of the privilege. He acknowledges also that there would be more unfairness to the husband in an adverse waiver finding than there would be to the wife if the privilege was allowed to stand. Thus, waiver does not really lie at the heart of the problem.
The husband’s contention is that albeit a third party document the loan form had a primary litigation related purpose and therefore any privileged information provided to Guardian by either the husband in section A and his lawyer in section B is itself privileged and to the extent that it contains any voluntary confidential disclosures does not amount to waiver because of the express receipt of the information in strictest confidence.[1]
[1] Woollahra Municipal Council v Westpac Banking Corp (1994) NSWLR 529 at 540; Stamp and Stamp (2007) FLC 93-314.
The parties clearly differ on what the confidential communication to be protected by client legal privilege is.
The wife says that it can only be the loan application document in and of itself. The sole purpose of the funding application form was to secure a loan offer from Guardian. Neither the intended litigation related purposes nor ultimate use of the funds, if any, characterises the document as a professional legal communication. This is so, argues the wife, even though the conduct of the litigation depended on the success of the application which, in turn, would be assessed partly the legal opinion as to likely prospects of his lawyer.
Mr Wilson for the husband argues that privilege attaches to the confidential communication of pre-existing privileged information repeated or reproduced in a document remains protected from disclosure unless and until its waived.
The context
Guardian lends money to litigants to pay their lawyers. The husband applied to the financier for funding last year. Section B of the Guardian application which was completed by the husband’s lawyer and includes a summary of legal advice on prospects based on disclosed instructions. Exhibit 1 is a blank copy of the standard funding application to assist me to determine the issue. Guardian acknowledges and promises to respect privilege. The loan form explicitly stipulates that where the information provided to Guardian includes information protected by client legal privilege it is being provided “…for the limited and specific purpose of allowing Guardian to consider the provision of finance to the (husband) for the purpose of funding, or partly funding, the legal proceedings to which the information and or documents relate.”
The wife’s filed application is for the husband to produce all funding application forms. She disavows any interest in privileged material and proposes that the non-privileged parts of the document be severed and the protected passages be withheld. However, in the Form 12 she refers to information about the husband’s financial position and par 22 of the written outline makes it clear that she also requires section B of the document.
The problem of present concern arises because the document in question came into existence for an allegedly non-legal purpose which in the hands of a successful opponent in pending litigation applying for inspection may be forensically harmful or embarrassing to the privilege holder.
The law
The interlocutory nature of the application to inspect means that the Evidence Act 1995 (Cth) provisions do not apply and all references are to the common law.[2]
[2] Mann v Carnell (1999) 201 CLR 1.
The onus of establishing privilege normally lies on the party asserting it.[3]
[3] AWB Ltd v Cole (No 5) (2006) 155 FCR 30 at 44.
The doctrine of privilege protects a confidential communication, whether oral or documentary, from disclosure in circumstances where its dominant purpose was giving or receiving legal advice or for use in existing or anticipated litigation.[4] Both factual instructions and advice given about the law or available options are protected if the relevant communication satisfies this test.[5]
[4] Esso Australia ResourcesLtd v Commissioner of Taxation (1999) 201 CLR 49 at 55, 59 and 61.
[5] AWB Ltd v Coal (2006) FCA 571 at [86].
Thus, a document will be outside the ambit of subpoena or discovery obligations only if created by a professional legal adviser acting in that capacity in a confidential context for the dominant purpose of legal advice or litigation use.
The concept of legal advice is a wide and can be an ongoing one but it does not extend to other professional or commercial advice.[6]
[6] Balabel v Air India (1988) 1 CH 317.
In the English Court of Appeal decision in Balabel v Air India[7] Taylor LJ explained the ongoing nature of legal advice:
…advice may be required or appropriate on matters great or small at various stages. There will be a continuum of communication and meeting between the solicitor and the client…where information is passed by the solicitor or client to the other as part of that continuum aimed at keeping both informed so that advice may be sought and given as requires, privilege will attach.
[7] [1988] Ch 317 at 330.
I have assumed for the purpose of argument that the information conveyed to Guardian by the husband’s lawyer in Section B of the loan application form was, at least originally, privileged. That is, it was brought into existence for the dominant purpose of giving or receiving legal advice or use in litigation.
Making this assumption, which is not disavowed by the wife, made it unnecessary for me to inspect the actual document in order to decide that fact.
A third party document containing privileged information has traditionally been accorded privileged status only in the limited circumstances identified by Lockhart J in Trade Practice Commission v Sterling[8] viz., (a) confidential legal communications made through an agent; (b) a draft confidential communication although not in fact so used; (c) communications within the legal firm acting for the client; (d) records of the client or lawyer of privileged communications; (e) documents provided to a third party for the purposes of pending or impending litigation to obtain expert advice or information about evidence or the evidence itself; (f) communication between the client and a non-agent third party with reference to litigation either at the instance or intended persistence of the lawyer; (g) a client’s knowledge information or belief derived from a lawyer or his agent in privileged communication.
[8] (1979) 36 FLR 244 at 245-6.
The wife asserts that the document does not fall into any of these categories, and, therefore, cannot itself be a privileged document.
The wife’s contention is that despite its confidential nature the loan application cannot be privileged because it was made for a non-legal or commercial purpose of obtaining finance. This proposition resonates with the dissenting view of McHugh J in Mann v Carnell[9] where his Honour said:
Documents are protected as part of a privileged communication. That means that the question whether a copied document recording a communication was made for a privileged purpose cannot be answered by asking whether the original document recording the communication was created for a privileged purpose. Privilege does not inhere in documents per se. Where … a document, to which privilege attaches, has been communicated to another person, the question whether it is also protected by privilege depends on whether the copy was communicated for a privileged purpose.
[9] (1999) 201 CLR 1 at 32[96]-[97].
In that case the Chief Minister of the ACT provided copies of legal advice received by the government about litigation with a constituent, Dr Mann, to a member of the Assembly on a confidential basis for the purposes of satisfying him that the litigation did not involve a waste of public funds. Some of the copied documents were later shown to Dr Mann who promptly instituted defamation proceedings against the Chief Minister. He later applied for preliminary discovery of the legal advice contending that either the privilege had been waived or the copies themselves were not privileged because the communication to the member was not for a “privileged purpose”.
The majority said[10] that “the principal question in this appeal is whether legal professional privilege which attached to certain communications was lost by subsequent disclosure of those communications”. This, to me, assumes the privileged status of the information passed on to the fact that the original communication might have been oral and the republication made in a document does not seem to me to matter much.[11]
[10] (1999) 201 CLR 1 at 4[1].
[11] See Esso Australia Resources Ltd v Commissioner of Taxation (1999) 201 CLR 49.
Likewise, in State Bank of South Australia v Smoothdale No.2 Ltd[12] King CJ found that reproductions of privileged witness statements did not deprive the statement of protection, notwithstanding the republication was not specifically for the purpose of obtaining legal advice or for use in litigation.
[12] (1995) 64 SASR 224.
Decided cases directly on point are hard to find. The closest I could come up with myself is Spotless Group Ltd and Others v Premier Building and Consulting Group Pty Ltd.[13] There a litigant gave summaries of legal advice relating to the proceeding on a confidential basis to a bank financing his claim and others concerned more indirectly with the litigation. The trial judge upheld the objection to inspection of those documents on the ground of legal professional privilege.
[13] (2006) 16 VR 1.
On appeal, the communication of the legal advice to the financier was held to be privileged by Chernov JA (with Warren CJ agreeing) and Neave JA for different reasons.
The majority held there was no relevant community of interest between the litigant and the bank such as to found the common interest privilege[14] but properly characterised the re-communication by the litigant to his financier was privileged legal advice even though it was not specifically created for the dominant purpose of obtaining legal advice or for use in litigation. There was no need, in those circumstances, to even ask whether the republication was made for a “privileged purpose”. Rather, the relevant question was whether, by passing on the communication to a third party, the plaintiff had waived privilege.
[14] Network Ten Ltd v Capital Television Holdings Ltd (1995) 36 NSWLR 275 applied.
The implied waiver ground was rejected because there was no inconsistency with the maintenance of the privilege in the communication of the legal advice to a financier on a confidential basis in order to secure funds to enable the litigation to be pursued. This much is already accepted by the wife’s legal team.
Neave JA, on the other hand, did not agree that a copy of a privileged document which is passed to a third party for an unrelated purpose remained privileged unless waived.[15] Nor did her Honour consider that the rationale for legal professional privilege required it to extend to third party documents containing privileged communications.
[15] (1999) 201 CLR 1 at 19[60].
Her Honour concluded that unless the third party document was specifically created for the dominant purpose of obtaining or giving legal advice or for use in litigation it could not be protected by privilege and reaffirmed that the mere fact that the communication was confidential is insufficient to justify extending privilege to it.
However, in reliance on the analogous reasoning of Bergin J in Rickard Constructions Pty Ltd v Richard Hails Moretti Pty Ltd,[16] a case concerning the legal professional privilege provisions in the Evidence Act 1995 (NSW), Neave JA found that information given to a fund provider was protected by privilege because it was given for the dominant purpose of the client “being provided” with professional legal services. The key to the characterisation of the document and its contents was seen by both Bergin J and Neave JA as the inextricable links between the protected advice, the third party document and the provision of professional legal services. Thus, the nature of the information and the purpose as well as the context of its communication or repetition in a document, are highly influential considerations. So too might be the identity and role of the recipient.
[16] [2006] NSWSC 234 esp. at [33].
As Chernov J pointed out in Spotless:[17]
It is common ground that the original communication, namely, the legal advice that was provided to the respondent, was subject to legal professional privilege. And it was that communication — that advice — that was passed on to the third parties. That the re-communication was in written form is, as I have said, irrelevant to this issue. What is of relevance is that, on its proper characterisation, the communication that was made to the third parties, effectively by the respondent, was the legal advice which it had received and to which privilege attached.
[17] [2006] VSCA 201 at [20].
Mr Wilson also referred me to the decision of Santow J in re Global Medical Imaging Management (in liquidation) ex parte Mezzanine Investments Pty Ltd.[18] The question there was whether a funding agreement between a liquidator and third parties satisfied the client legal privilege requirements under s 119 of the Evidence Act 1995 (Cth).
[18] [2001] NSWSC 476.
Santow J noted that such a funding agreement might “at first blush” not pass the dominant test (because it was not for the provision of legal professional services but, rather, for a purpose anterior to their provision, namely litigation funding) but went on to say that to deny legal privilege to a funding agreement of that sort would fail to give proper weight to its inextricable connection with the very subject matter of the legal advice that might be given and the nature of the professional legal services to be rendered. It has the potential to reveal the litigant’s likely legal strategy. He noted:
The funding agreement, in a literal and substantive sense, fulfils the purpose of providing legal services in terms not only of the overall capacity to have them at all, but also their availability at critical junctures of the case. While it may not reveal the content of the legal advice, it reveals the confidential circumstances of its availability and throws oblique light on the confidential circumstance as to which the advice is directed. [my emphasis][19]
[19] [2001] NSW SC 476 at [7].
Mr North SC sought to distinguish a funding agreement between a liquidator and third parties and the husband and Guardian on the “common interest” basis. That is, the relationship between liquidator and third parties was a common interest one whereas at its highest the relationship between the husband and Guardian, was that of creditor and debtor which is not sufficient to create a common interest in the litigation.[20]
[20] Bank of Nova Scotia v Hellenic Mutual War Risks Association (Bermuda) Ltd (the Good Luck) (1992) Lloyds rep 540 at 542.
However, Mr Wilson informed me from the bar table without objection that Guardian secure their risk by taking a lien over the proceeds of the litigation. This might be said to give it an interest in common in those proceeds.
I have reached the same conclusion as the Victorian Full Court in Spotless. I prefer the majority view to that of Neave JA’s. However, regardless of the reasoning the result is the same.
I am satisfied that there is sufficient evidence to support a finding that the disclosure of privileged information to Guardian is a third party loan application which in itself is a privileged document for either of the alternative reasons given in Spotless.
This conclusion is not only consistent with precedent and principle but is also concomitant with public policy.
In light of the concessions made by Mr North SC, it is unnecessary for me to consider the waiver issue in detail.
However, regardless of whether the husband’s lawyer divulged to Guardian in Section B of the loan application, the act of doing so cannot constitute implied waiver under the Mann v Carnell[21] rules because there was no inconsistency with the maintenance of the privilege in confidentially disclosing the information to a financier for funding related purposes.
[21] (1991) 201 CLR 1 at 13.
Thus whether there was a relevant community interest between the husband and Guardian so as to give rise to the common interest privilege is unnecessary for me to decide.[22]
[22] cf. Network Ten Holdings Ltd v Capital Television Holdings Ltd (1995) 36 NSWLR 275.
Litigation funding is a relatively new but growing socio-legal phenomenon. A ‘bankroller’, though not legally qualified and not acting in a professional legal capacity, does much the same thing for a client as a lawyer does. Both help him or her conduct litigation. One provides what the other pays for. Without the funds the client may not be able to afford to retain the lawyer without whom he or she is unlikely to be able to present the best case.
The availability of legal insurance or financing offers hope and a practical solution to an asset rich but cash poor litigant like the husband and, for that matter, the wife. It bridges the gap between government funded legal aid systems for the very poor and the open cheque book of the very rich. It enables those in the middle to prosecute or defend with a lawyer of choice who is not prepared to postpone the periodic render or payment of professional fees for services. No doubt, legal firms have their own commercial commitments to meet and are as cash flow reliant as any other business in the modern world.
Another social benefit of legal funding is the access it gives to the courts. Equal justice is available to more litigants with than without it. It also tends to reduce the number of self representing litigants appearing in the courts.
The prerogative of a party to appear in person is guaranteed in Australian Federal Courts by s 78 Judiciary Act 1903 (Cth). Those involved in State court actions presumably have the same entitlement.[23]
[23] Cachia v Hanes (1994) 179 CLR 403 at 415.
The number of self representing litigants has grown exponentially across all jurisdictions in the last decade or so. They account for up to half of all appearances in federal courts in 2004.[24] Of those, less than one third preferred to represent themselves and more than one quarter either were not eligible or did not want to accept legal aid. The balance did not think they were entitled to apply for legal aid.[25]
[24] Australian Institute of Judicial Administration in the Federal Court of Australia report, Forum on self-represented litigants Sydney 17 September 2004 (Canberra) AIJA, 2001 at 1.
[25] Rosemary Hunter et al Super Self Representation in the Family Court of Australia and Legal Aid, April 2003.
Many do not have legal representation because they cannot afford it themselves and do not qualify for legal aid.[26] Admittedly, some prefer the D.I.Y. for a range of reasons such as disenchantment with the legal system or profession, (self) confidence, and a (often misplaced) belief that the matter is a simple one with an obvious solution – theirs.
[26] Australian Law Reform Commission, Review of the adversarial system of litigation: Rethinking the Federal Civil Litigation System, IP 20 (1997) at [8.5].
The disproportionate cost of legal representation these days can lead to the injustice of parties with a valid claim or defence simply walking away. The emotional nature of family property law and the ongoing financial consequences of the outcome of litigation on the parties and their children usually make it more desirable for vested interests to have professional help rather than to do it themselves. In family litigation, it can be difficult even for trained and experienced professionals to maintain the degree of detachment and objectivity needed. It must be almost impossible for former spouses.
Anyone who appears in a court without legal representation in their own cause is taking on a heavy responsibility. Self representing can also make it more difficult for the other party and many complicate and prolong the trial process.
The effect of the rules, procedures and legal intricacies as well as the culture of adversarialism marginalises a self representing litigant. Our system assumes the parties will be represented by competent lawyers. It has no inbuilt mechanism for ensuring the fairness or removing obstacles to justice in cases of uneven representation. It does not have two sets of rules, one for lawyers and another for self-represented parties. The same legal principles, rules and standards of procedure apply regardless of whether a litigant is represented or not.
There is also a concern for a litigant forced to represent his or her own interests opposed by an experienced practitioner, in this case, a leading Senior Counsel, in this specialised area, would be especially disadvantaged. A fundamental aspect of equality for all before the law is that parties are equally matched. There is a disturbing imbalance where one is represented by a professional advocate and the other is not.
To deny protection to section B of the document would, to borrow from Santow J in re Global,[27]:
…fail to give proper weight to its inextricable connection with the very subject matter of the legal advice that might be given and the nature of the professional legal services to be rendered … (the document) … fulfils the purpose of providing legal services in terms not only of the overall capacity to have them at all, but also their availability at critical junctures of the case.
[27] [2001] NSWSC 476 at [7].
For all of the above reasons, I would dismiss the wife’s application and deny her access to Section B of the loan application form to the extent that it refers to instructions given or received by or from the husband and the giving of legal advice on the basis of those instructions.
Even if I am wrong about the scope and reach of the protection given by the law to the funding application form, as a matter of principle and public policy I would still refuse to make the disclosure order the wife seeks on discretionary grounds.
In exercising its powers to make orders, the court applies its procedural rules in a way that deals with each case fairly and justly and proportionately to the issues, complexity and cost of resolving the issues.
The Family Law Rules make provision for disclosure and inspection of documents. Each party and their lawyers have an obligation to comply with the duty of disclosure in r 13.01, 13.07 and 13.08. Rule 13.07 imposes the duty of disclosure on the disclosing party. Rule 13.12 relieves a disclosing party from production of privileged documents. Rule 13.22(1) provides relief to an inspecting party who suspects incomplete disclosure and rule 13.22(3) sets out the considerations that may be taken into account in determining a contested disclosure application including relevance and relative importance, time, cost and inconvenience issues.
A document subject to a claim of privilege does not need to be produced for inspection unless ordered.
The duty of disclosure is owed to the court and to each other party. It requires fullness and frankness when disclosing all relevant information.
Its purpose is to discourage surprise, forensic disadvantage, concealment or deception, prejudice or injustice by giving opposing sides access to non-privileged information that can be used to strengthen their own or weaken their opponent’s case. However, no rule or duty is absolute. The circumstances vary from case to case and some may justify departure where in circumstances where it is not inconsistent with the requirements of natural or distributive justice.
An interlocutory order to enforce the duty of disclosure is not made lightly because proper discharge of the duty can ordinarily be assumed where both parties have lawyers. The party alleging or anticipating a non-compliance must prove it as a probability.
It is sometimes necessary in the interests of overall justice to modify, compromise or relieve against a rule or duty because strict enforcement can have unintended and unfortunate consequences for one party without doing anything to advance the strategic or other legitimate interests of the other.
The duty to disclose documents is limited to those relevant to issues in the case. The issues the disputed document relates to valuation and, no doubt, credibility issues. Non-disclosure will deprive the wife of information about what her husband’s instructions to her lawyers are and what his lawyer thinks about his prospects about the success in the litigation. These are both matters which are not normally available to an opposing interest because of the doctrine of privilege.
Access to such litigation sensitive information would give a windfall forensic advantage to the wife, particularly in negotiations and correspondingly disadvantageous to the husband.
Compelling a resisted disclosure is normally only done when necessary to achieve the main object of the rules, not inconsistent with the legislative provision. However, compliance with a rule can be dispensed with at any time by the court either on application or of its own initiative; r 1.12. Granting dispensation to a party or relieving against the strict requirements of a rule is an exercise of discretion. Relevant factors include the main purpose of the rules, the administration of justice, any prejudicial forensic effect on the opposing interests.
Likewise, the court may waive of dispense with the rule of evidence under s 190(3) of the Evidence Act 1995 (Cth) if the matter to which the evidence relates is not genuinely in dispute or the application would involve needless expense of delay. The matters the court takes into account are the relevant importance of the evidence in the proceeding, the nature of the subject matter of the litigation (ie. money) and the probative value of the evidence.
The court may also refuse admission to an item of evidence the probative value of which is substantially outweighed by the danger of unfair prejudice to the other party under the discretionary exclusion of s 135. Both reflect the anxiety of the common law to avoid prejudice or unfair disadvantage in litigation.
If I was deciding an admissibility issue at trial rather than a disclosure issue at an interlocutory stage, I would, of course, be invited to look at and decide whether to admit or exclude by reference to the form and contents of the document in question.
Cook & Ors v Pasminco No 2[28] is clear authority for the proposition that a party seeking discovery or production a non-privileged third party document containing otherwise privileged information can properly be denied access for reasons of confidentiality and fairness.
[28] (2000) 179 ALR 462.
In that case, Lindgren J refused to allow access to a clause in a costs agreement because, although the cost agreement document itself was not privileged per se (because it was not created for the dominant purpose of giving or receiving legal advice or of being used in existing or anticipated legal proceedings) the clause was expressed in the form of statements by a lawyer to a client constituting the giving of legal advice.[29]
[29] (2000) 179 ALR 462 at 470-471.
I also note that it was found in Lake Cumbeline Pty Ltd v Effen Foods Pty Ltd[30] that a memorandum of costs disclosing the nature of instructions given by a client or the advice given to him may be privileged.
[30] (1994) 126 ALR 58.
Use of the document in cross-examination may, depending on what is actually in section B, be highly embarrassing for the husband and equally beneficial to the wife’s case. It could, however, be just as easily useless to the wife as a forensic tool but still seriously prejudicial to the husband in, say, settlement negotiations for instance.
Even if the loan document does disclose a statement inconsistent with those previously made by or on behalf of the husband, it may give rise to adverse inferences about trustworthiness in relation to collateral matters but is unlikely to do anything worthwhile to help resolve key issues.
The forced disclosure of what a lawyer tells a financier about what he says his instructions were and what he says he advised his client about his chances based on those instructions is fraught with danger and could conceivably damage the client/lawyer relationship and embroil the lawyer in the controversy.
All in all, more justice is likely to be done by denying the wife’s application then granting it. Accordingly, the husband will be relieved of any obligation to produce section B for the wife’s inspection in these proceedings.
Access to the Company’s server
The wife also seeks a mandatory order that the husband cause the R Group Pty Ltd, his admitted alter ego, to provide the wife with direct access to the company’s server on the basis that it would enable her to be fully and frankly informed as to the husband’s business dealings without placing any imposition on him.
Her position is succinctly stated on the second page of Annexure 16 of her supporting affidavit:
Our client’s access to this information will not cause any inconvenience or cost to your client or interfere with the operation of the business. It means that our client does not have to make continual requests for information and documents. It also facilitates your client’s ongoing obligations in a practical way. The access will also ensure that our client is able herself to retrieve information which she considers relevant and appropriate.
In essence the wife is seeking to forcibly relieve the husband of his obligation of disclosure which he does not want to give up.
The wife had unrestricted access to the R Group server from the date of separation in January 2004 to September 2004. This gave her real time access to all documents on the server including documents scanned into the system.
The husband submits that the wife is “estopped” from seeking an access order because par 5 of the orders made by JR Smith on 10 January 2006 addressed the wife’s complaint to accessing information and to the inadequate provision of information from the R Group by requiring the husband to provide detailed quarterly reports. Those orders were made by consent to provide detailed information to the wife on a quarterly wife in answer to the wife’s concerns about her lack of access to the server.
The wife makes no complaint in her material that the husband has not complied with the order. Although there have been disputes about the sufficiency of the information provided by the husband, there is no evidence that he has breached his general obligation of disclosure or is not disclosing server information fully and frankly.
The husband, on the other hand, raises concerns about giving the wife carte blanche access to the server when it contains commercially sensitive information irrelevant to the proceedings including privileged communication with solicitors and personnel details.
He says the server is the brain of the organisation and that on the balance of convenience, the wife’s access will cause more practical problems than it will solve.
A mandatory injunction is a serious step which is not to be taken lightly. The court must be satisfied that the order is necessary for efficiently and justly disposing of the case or an issue.
I am not satisfied that there is any good purpose to be served by reinstating the wife’s access to the server or issuing a mandatory injunction against the husband to provide her with easy and direct access to the server. His obligation to fully and frankly disclose relevant information in his control or possession remains undiminished.
The wife already receives high level classified financial information from the husband in quarterly instalments.
The server contains extraneous including privileged and confidential information and the husband identifies past and possible future difficulties that giving the wife direct access to the server might cause the ordinary and orderly conduct of the company’s business regardless of their merits, the husband has applied for injunctions to restrain the wife from interfering with the operations of the R Group especially making contact with clients or associates when she had access to the server. That is why she agreed to have it cut off and why he does not want to reinstate it now. Giving access to the server will not necessarily reduce the scope for further interlocutory applications anymore than refusing it e.g. applications for further and better disclosure by the wife.
In those circumstances, I will also dismiss the wife’s application in par 3 of the Form 2 filed 27 August 2007 and I order accordingly.
I certify that the preceding ninety two (92) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Carmody
Associate
Date: 14th December 2007
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