Bougainville Copper Limited v RTG Mining Inc and anor (Transcript Ruling)
[2018] VSC 499
•3 September 2018
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMERCIAL COURT
S CI 2018 00309
| BOUGAINVILLE COPPER LIMITED | Applicant |
| v | |
| RTG MINING INC and CENTRAL EXPLORATION PTY LTD | Respondents |
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JUDGE: | Mukhtar AsJ |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 17, 18, 21 May 2018 (written submissions 26 June 2018) |
DATE OF RULING: | 3 September 2018 |
CASE MAY BE CITED AS: | Bougainville Copper Limited v RTG Mining Inc and anor (Transcript Ruling) |
MEDIUM NEUTRAL CITATION: | [2018] VSC 499 |
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PRACTICE AND PROCEDURE ― Non party’s request to obtain transcript ― Hearing in interlocutory hearing ― Evidence by affidavit ― Transcript of argument only ― Matters to be considered
PRACTICE AND PROCEDURE ― Orders for confidentiality of filed documents ― Court’s inherent jurisdiction ― Application for pre-action discovery of documents ― Respondents’ apprehension that grounds of application insinuate scandalous or seriously improper conduct ― Whether confidentiality order over all Court documents ought be made ― No application for confidentiality throughout hearing ― Application after judgment reserved ― Application refused ― Supreme Court (General Civil Procedure Rules) 2015, r 28.05.
APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | On written submissions | |
| For the Defendant |
HIS HONOUR:
The Court has heard, and has reserved, its decision on an intensively fought application for pre‑action discovery of documents under rule 32.05 of this Court’s general civil procedure rules. That is an application brought against an identified prospective defendant against whom an applicant has reasonable cause to believe that it has, or may have, the right to obtain relief but it needs additional information by way of discovery of documents from that prospective defendant to assist in making a decision whether or not to sue.
The underlying commercial context of the application is the pursuit as between the applicant (‘BCL’) and the second respondent (‘Central Exploration’) in venturing to gain commercial interests to explore and develop the former Panguna mine in the Autonomous Region of Bougainville in Papua New Guinea. The first respondent is a minority shareholder in Central Exploration with two common directors, and for ease of narration I shall refer to them here as the respondents.
An unexpected and distracting controversy that is unconcerned with the merits of the application has since been agitated by the respondents. It calls for a ruling. It started with the authorised transcript provider notifying my Chambers on 21 May 2018 that a Mr Nik Zuks had enquired about obtaining the transcript of the hearing. He is not a party. He is not a deponent. But he is no stranger to Bougainville and the underlying commercial interests in this application. Mr Zuks is one of four defendants named in a proceeding commenced in the Supreme Court of Western Australia (‘the WA proceeding’) on 13 November 2017 in which the respondents in this application are two of three plaintiffs in that proceeding. BCL is not a party to that proceeding. The writ and amended statement of claim in that proceeding were referred to and tendered in evidence in this application.[1] The WA proceeding alleges amongst other things the use and misuse of the respondents’ confidential information by Mr Zuks and others in the pursuit of interests in the former Panguna mine. For this ruling, I have been told by the respondents that on 15 February 2018 Allanson J made an order in the WA proceeding that ‘Until further order of the court, any application for inspection of any document filed in this action is to be referred to the Case Manager’. I should like to inform His Honour that the statement of claim was produced by the respondents and received into evidence without any resistance or reference to the controlled inspection order. I am afraid to say the situation has been obtained where I cannot but have regard to it in this and the principal application.
[1]Tendered Court Exhibit C and Exhibit I.
The transcript provider has asked if I am content to allow a release of the transcript to Mr Zuks on payment of a charge. Part VI of the Evidence (Miscellaneous Provisions) Act 1958 concerns the recording of evidence. Section 134 states:
Every person recording any evidence pursuant to this Part shall for the time being be an officer of any court in or for which he or she is required to record the evidence and shall be under the direction of the court with regard to the performing of his or her duty in recording and transcribing or causing to be transcribed such evidence.
There is a question whether that broad provision means the transcript provider is under the direction of the court about the release or confidentiality of completed transcript, as distinct from a court’s directions for the process in the courtroom of actually recording or transcribing the evidence. It can be assumed the transcript provider owns the copyright in the transcript. According to its website, the transcript provider takes the attitude, as occurred here, that:
Upon request and under specific circumstances (subject to approval from the presiding Judge, Member or Officer), media organisations, law firms and other parties not directly involved in the proceedings may be able to purchase the transcript of the proceedings.[2]
[2]< type="1">
The transcript in this application was not of any evidence. The evidence on the application was adduced, typically, by affidavit without any other spoken evidence in chief or cross examination. Indeed, I had made an order refusing an application by BCL for leave to cross examine the Chief Executive Officer of the first respondent (who is also a director of Central Exploration) on her affidavit.[3] The transcript of the hearing was therefore only a transcript of argument, which endured for three days.
[3]See order dated 17 May 2018.
None of the affidavit materials according to which submissions were made were adduced by either side on condition that they be received by the Court as confidential. The affidavit materials to which I was taken did not seem to have the innate quality of being confidential or proprietary in nature, and I do not understand the respondents to now be saying they did. Nor in any other sense or context was there any apprehension expressed by the respondents at the hearing about possible damage to them by the revelation of the affidavit evidence in the course of submissions. Nor, more pertinently, was there any apprehension expressed by the respondents about a possible risk of damage to them by any media reporting of the submissions made in Court on BCL’s behalf by reference to any particular facts forming the foundation of the BCL’s ‘reason to believe’ that a wrongdoing may have been committed by the respondents. The application required BCL to establish as a threshold matter the grounds on which it has reason to believe that it has a right to relief or remedy. On the authorities that requires something more than a hunch.
One of the normal attributes of a court is publicity. Everything on this application was said and done in open Court. Under the Open Courts Act 2013 (Vic) there is a presumption in favour of disclosure in aid of strengthening and promoting the principles of open justice and free communication of information.[4]
[4]See s 4 of the Open Courts Act.
Despite all that, the respondents have objected to the Court permitting Mr Zuks to obtain the transcript from the provider. They sought to make written submissions and have the question decided on the papers. As for BCL, its solicitors said:
Our client has no particular objection to the request by Mr Zuks for access to transcript. In this regard we understand that the Respondents were aware that Mr Zuks attended court for the duration of the hearing but did not seek any order to close the Court or to otherwise exclude Mr Zuks from being in attendance for any part of the hearing.
Nevertheless, we note that the Respondents object to the release of transcript to Mr Zuks and intend to file written submissions in support of that objection. Our client does not oppose that course of action, and has no objection to his Honour determining the application for release of transcript on the papers as proposed by the Respondents’ solicitors, subject to reserving the right to respond to any part of the Respondents’ written submission which might bear upon the matters before the Court in our client’s application.
Subsequently, the Court received written submissions from the respondents dated 26 June 2018. But, those submissions went much further than objecting to the release of the transcript to Mr Zuks. The respondents sought a blanket order that all documents in the proceeding, including transcript, remain confidential to the parties. These were the orders sought ―
1.All documents filed or tendered by the parties or created by the Court in the within proceedings (including orders made and transcripts of proceedings) (Documents) remain confidential as between the parties to the action;
2.Any request for inspection of any Documents by any non‑party pursuant to rule 28.05 of the Supreme Court (General Civil Procedure) Rules 2015 be directed to the Associate to the Honourable Associate Justice Mukhtar for consideration.
BCL has objected to the making of any confidentiality orders or ancillary orders concerning inspection. It says that no such order was sought before or during the course of the hearing at which Mr Zuks was present, and it ought be made to the Court by a proper application supported by affidavit evidence.
The respondents have not sought to rely on any evidence to support the confidentiality order, but only on their submissions. In the exigencies created, I think it better to determine the sustainability of the application according to the written submission without requiring a formal application. I am disposed to do so without calling on BCL for a responding submission for in my view the respondents’ submissions do not make out a case to justify a confidentiality order, nor to prevent the court from allowing Mr Zuks to purchase the transcript of the application. My reasons follow.
The Court has inherent jurisdiction in civil and criminal matters, to make confidentiality orders to ensure convenience and fairness in legal proceedings. That could include an order prohibiting access to a Court file, which is a power not limited or affected by the Open Courts Act 2013 (Vic).[5] It is commonly done in cases involving trade secrets or breach of confidence or trade practices, under orders that enable confined and controlled disclosure of documented evidence on undertakings to prevent injury by any disclosure of confidential or proprietary information. It would be a rare case though to order that a transcript of argument be treated as confidential. To go that far seems to me to involve making a suppression order on any information derived from a proceeding, which under the Open Courts Act would require a Court, in the present context, to be satisfied that such an order ‘..is necessary to prevent a real substantial risk of prejudice to the proper administration of justice that cannot be prevented by other reasonably available means.’[6]
[5]See s 7.
[6]See s 18 of the Act.
The question of a non-party’s access to a transcript is not the subject of this Court’s procedural rules. Nor is it within its Practice Note concerning transcript in civil proceedings.[7] I notice the Federal Court of Australia has a General Practice Note dealing expressly with transcript in this way:[8]
A party or non-party (including the media) may purchase the whole, or a part, of a transcript in a proceeding from the Court’s Authorised Transcript Provider, unless the Court has ordered or directed that a transcript:
(a)is, in whole or in part, confidential or the subject of restrictions on access; or
(b)may not be published or reproduced without leave of the Court.[9]
[7]See Practice Note SC Gen 7, 29 June 2018.
[8]Issued 25 October 2016. See para 6.3.
[9]See Part VAA of the Federal Court Act generally in respect of suppression and non-publication order.
It is useful I think to look at the guidance given in that Practice Note concerning access to court documents generally. The overarching principle is said to be one of ‘open justice’, which requires ‘justice being seen to be done and ensuring that nothing is done to discourage the making of fair and accurate reports of proceedings’.[10] The open justice principle is, however, not absolute and is subject to the interests of justice.[11] The Practice Note also provides a range of factors to be considered for requests to obtain access to court documents.[12] The factors include:
[10]Ibid cl 2.1.
[11]Ibid cll 2.2-2.3.
[12]Ibid cl 4.10.
(a) whether the applicant is a party or non-party;
(b) whether the documents fall initially within a restricted or unrestricted category;
(c) the context surrounding, and purpose underpinning, the request;
(d) the nature of the documents sought (e.g. whether the documents have been admitted into evidence or read out in open court, whether the documents are confidential, restricted from publication, the subject of legal privilege, contain scandalous material etc.); and,
(e) the principles of the open justice approach, including whether the request may result in an undue burden on the Court.
In this case, the respondents look to Rule 28.05 of the Supreme Court (General Civil Procedure) Rules 2015 which states:
(1)When the office of the Court is open, any person, on payment of the proper fee, may inspect and obtain a copy of any document filed in a proceeding.
(2)Notwithstanding paragraph (1) –
(a)no person may inspect or obtain a copy of a document which the Court has ordered remain confidential;
(b)a person not a party may not, without leave of the Court, inspect or obtain a copy of a document which in the opinion of the Prothonotary ought to remain confidential to the parties.
The foundation of this rule is ‘any document filed in a proceeding’. But, a transcript is not a document filed, or file-able, in a proceeding. However, it is the observable practice in this Court that a transcript is placed in a distinctly separate part of the file marked as being confidential. Similarly, documents such as exhibits to affidavits (which are also not required to be filed) are also placed in that separate confidential folder. I have wondered about the reason for that, but suppose that such documents are examples of documents which the Prothonotary has, as an administrative or ministerial matter, formed the opinion under s 28.05(2)(b) that if they are not file-able, they ought be segregated as confidential and not be available for inspection by the public, at least not without leave of the Court under rule 28.05(2)(b). But, once those documents (such as an exhibit) are deployed in open court, they would cease to be confidential.
Most of the recent decisions on rule 28.05 relate to the disclosure of material from old divorce cases (or matrimonial causes as they were known); that is, involving fault based grounds of divorce which could be expected to contain evidence of personal behavioural matters, possibly scandalous, best treated as confidential in the interests of decency and true privacy. Those decisions establish that the court looks to the utility of granting the access to a non-party in all the prevailing circumstances.[13] The relevant considerations include: issues of confidentiality or privacy; the content of the file; the interest and purposes of the applicant; the utility of permitting the access sought; and whether conditions should be imposed.[14] In a case where the Prothonotary has treated court documents as confidential, and a non-party seeks the Court’s leave under r 28.05(b) to inspect those documents, another case states that the applicant should file an affidavit stating: who the applicant is, and what association the applicant has, if any, with the parties; the purpose for which access is sought and how the applicant perceives that access will further this purpose; the use the applicant intends to make of the information if access is allowed; and who, if anyone, may have an interest in the file or in the application, and, if there is any such person, whether they have been notified of the application. [15]
[13]In the Matter of Proceeding No 3159 of 1970 [2015] VSC 61 [8], referred to in IMO Proceeding No. 1351 of 1953 [2016] VSC 367 [6].
[14]In the Matter of Proceeding No. 1364 of 1964 [2010] VSC 494 [8].
[15]In the Matter of Proceeding No. 291 of 1944 [2006] VSC 50 [22].
There is a question whether all that is said under rule 28.05 concerns, according to its subject matter, only documents that are filed and is therefore unconcerned with something like transcript. I think it idle to dwell on that. What is plain is that the Court has an inherent power, which is not infrequently exercised especially in commercial litigation, to order Court documents to be confidential and that can extend to the transcript in the appropriate case. But, I would emphasise, the power would at least in non-criminal cases, normally be attracted for the protection of evidence and not the legal submissions made in Court.
The respondents do not seek a confidentiality order on the basis that the transcript has innately the quality of being confidential or as containing confidential information. They cannot. It was a transcript of argument. They object to Mr Zuks or anybody obtaining a copy of the transcript on the grounds that:
(a)the nature of the insinuations advanced by the applicant (BCL) in the within proceeding, including suggestions of unlawful and criminal conduct, are serious and scandalous;
(b)the insinuations are made in the context of an application for preliminary discovery but it is not always plain from the transcript that certain statements are made putatively rather than factually;
(c)if publicly disseminated or reported upon, the insinuations of BCL may readily be mistaken as statements of fact and in any event are likely to cause serious prejudice to the respondents;
(d)in light of the scandalous nature of BCL’s insinuations and the serious risk of prejudice to the respondents, the transcript and all documents filed or produced in the within proceeding ought to be treated confidentially at least until such time as the Court publishes its reasons for decision;
(e)in the case of Mr Zuks, he is not a party to nor has any interest in the outcome of the within proceeding; and
(f)as a party to separate proceedings in the Supreme Court of Western Australia to which BCL’s Counsel referred at the hearing, Mr Zuks is already fully apprised of the allegations he faces in the Western Australian proceeding.
What is co-incidentally common to this application and the WA proceeding are allegations (or more precisely for the purposes of this application under rule 32.05, grounds for a ‘reasonable cause to believe’) of wrongful conduct in the pursuit of commercial interests in the development of the former Panguna mine. I will confine myself to saying, compendiously, that the instant application stems from the fact that BCL operated the mine from 1972 but production was halted in May 1989 by militant activity. Under later legislation, BCL was granted an exploration licence for two years from September 2014. It was thought that BCL had the support of the association of land owners as the preferred developer of the mine, but in January 2018, the Autonomous Bougainville Government refused to grant the extension of the exploration permit, a decision for which BCL has obtained leave to seek judicial review in the National Court of Papua New Guinea. With, ostensibly, a lapsed exploration permit, the respondents pursued the support of the association of the customary land owners to obtain the exploration and mining rights to develop the mine. To that end, BCL shows that the respondents made presentations to government representatives in support of developing the mine under a joint venture with Bougainvillians. It eventuated that contrary to perceptions or evidence that BCL had the support of the majority of the land owners as the preferred developer of the Panguna Mine, allegiances then shifted after a reconciliation of divided views within the land owner organisation and its leadership with the result that the respondents eclipsed BCL and obtained support as the preferred development partner of the Panguna Mine.
In this application BCL says it has reason to believe that the unexpected change of support, and its displacement, was the result of false or misleading and injurious misrepresentations made by the respondents made to government and to landowner associations about BCL’s suitability and historical conduct in Bougainville, in order for the respondents to gain a favourable reception for their pitch to gain the exploration and mining interests. More confronting or rankling to the respondents, is BCL’s contention that disquieting shifting of allegiances occurred giving it grounds to believe that payments of money or compensation or other financial benefits were directly or indirectly paid by the respondents to members of the land organisation and others to overcome pre-existing divisions within the landowners’ association about the choice of preferred mine developer. In elementary terms, BCL says it has reason to believe that the respondents have engaged in illicit behaviour or business practice to obtain or shift or influence the support of the landowners’ association (that owns the mineral rights) in favour of obtaining exploration and mining interests for themselves, which by pre-design was injurious to BCL’s existing or pre-existing economic interests and which ended up displacing BCL. The contemplated causes of action, subject to the outcome of the application for pre‑action discovery, seem to be based on misrepresentation, economic torts, conspiracy to injure and injurious falsehood.
The WA proceeding was forensically part of the fabric of BCL’s case on the application. The amended statement of claim in the WA proceeding is quite lengthy and I trust I do no disservice if I summarise the essential allegations by the respondents as follows:
(a) Mr Zuks has interests in the business of mining and exploration, including the development of mining interests in Bougainville;
(b) he and others advise persons and organisations within Bougainville, including the Autonomous Bougainville Government, about matters such as fiscal self-reliance, governance, banking, insurance, legal issues and the development of international relations;
(c) he was introduced to the respondents as having experience in commercial dealings in Bougainville as well as being willing to make significant financial investments in shares in the first respondent; he was introduced to the respondents as having experience in commercial dealings in Bougainville as well as being willing to make significant financial investments in shares in the first respondent;
(d) after signing a deed of confidentiality, he was given confidential documents, including geotechnical data;
(e) he agreed through his company Kalia Holdings to subscribe US$5 million in equity in the second respondent, Central Exploration Pty Ltd;
(f) having made a subscription agreement, he was entitled to be nominated as a director of Central Exploration Pty Ltd and he was given regular reports on confidential matters;
(g) he became a director of Central Exploration Pty Ltd thus incurring duties under the Corporations Act;
(h) he received regular updates from Central Exploration Pty Ltd about its activities and plans in relation to the Panguna Mine and was given other confidential information including information concerning the expiration of BCL’s exploration licence and Central Exploration’s strategic and operational matters relating to the Panguna Mine upon the expiry of the BCL exploration licence; and
(i) in November 2016, a Separation Deed was made under which he resigned as director of Central Exploration Pty Ltd on terms that included the return of all confidential information and covenants not to disclose the confidential information, as well as agreements to not compete in any business that competes with Central Exploration’s project interests.
The central allegation of wrongdoing in the WA proceeding is that Mr Zuks and his co-defendants directly competed and interfered with the Central Exploration’s project interests, and he put forward an alternative option to the Bougainville Government for another company in which he had interests to be granted the licence to redevelop the Panguna Mine. The plaintiffs in the WA proceeding allege misuse of confidential information by Mr Zuks and others in their activities in Bougainville which were in direct competition with those of the plaintiffs’ project interests. The causes of action are based on breaches of the Separation Deed, and tortious conspiracy, and permanent injunctions retraining the use of confidential information. It seems to me the case also involves allegations of illicit conduct albeit of a different variety, but to the same commercial end. It is essential to recognise that the WA proceeding involves as its very subject matter the use and misuse of confidential information.
As I follow the respondents’ submission for a confidentiality order, they are based on the perceived harmful nature of the grounds on which BCL’s propounded its application for pre action discovery. The respondents say ‘the nature of the allegations and insinuations made by BCL were of a very serious and scandalous nature, extending to allegations of unlawful and potential criminal conduct.’ The submissions add, ‘These insinuations are self‑evidently of a serious nature and are prejudicial to the commercial interests and standing of the respondents and the profession reputation and integrity of those of their directors, officers and agents involved in the conduct alleged.’ The steps of the argument then go as follows:
(a) the prejudicial nature of the insinuations militates against the desirability of any public airing of them at this stage of the proceeding;
(b) the nature of the pre‑action discovery may not be appreciated by members of the public or media who are not legally trained: that is, they will not understand the ‘nuance’ whether the application requires a sufficient factual basis upon which to make such serious allegations;
(c) Central Exploration is required under the ASX listing rules concerning continuous disclosure to announce to the market any information that may reasonably be expected to have a material effect on the price or value of its securities, even though to date, the insinuations in this application have not been reported as they are matters of supposition that are insufficiently definite to warrant disclosure;
(d) the Supreme Court of Western Australia has made an order in the Western Australian proceeding that any request for a copy of any document filed in the course of the Western Australian proceeding be directed to Justice Allanson as the case manager; and
(e) that order was made in recognition of the serious nature of the matters alleged in the Western Australian proceeding and the potential interest that may be generated from media representatives and the like, and this Court ought to make a similar order.
The respondents accept, as they must, that the very nature of the ‘reason to believe’ gateway to rule 32.05 permits speculation about wrongdoing. It is asserted that the submissions of BCL’s senior counsel on the application made insinuations of a very serious nature, and in a manner suggesting particularly to a lay observer that they were well founded allegations.
In my judgment it goes too far to say that the submissions scandalised the respondents, to the point of outweighing the interests of open justice and now requiring a confidentiality order lest the submissions be republished somehow, possibly by the mass media. As for an advocate’s manner, I would describe the application as confronting to the respondents in what appears to be a politically tense or charged state of affairs involving substantial commercial interests. But that is the nature of the case. And it was there at the very inception. Yet no application was made beforehand for a suppression order or a confidentiality order.
I detect the respondents’ application for confidentiality is based more on the vigour and possibly the language of advocacy in which the primary application was propounded on behalf of BCL by senior counsel. I agree the technique of insinuation was used, but not illegitimately so or in an opprobrious sense. The nature of the contemplated case and the means afforded by rule 32.05 made it unavoidable to do so. The reasonable bystander would have heard that the advocacy for the respondents by their senior counsel was no less spirited in urging the Court to disqualify the application as being based on nothing more than mere hunch and that the rule was being used by BCL improperly for investigative purposes without showing an anterior objective basis for having a ‘reason to believe’. I think an apprehension by the respondents that the reasonable bystander (who must be postulated is being reasonably informed) might not understand the nuances or the difference between a reason to believe and a proven or evident fact is, more perceived than real.
Further, I do not regard the inspection order made in the WA proceeding as impressing a need to follow suit in this case. The two matters are distinguishable. The very subject matter of the WA proceeding concerns the use and misuse of confidential information. One can readily see therefore the occasion for Justice Allanson being moved prudentially, in the interests of justice, to protect the respondents’ confidentiality. In the present case, there are no such factors.
As for Mr Zuks, I see no reason why he should be denied access to the transcript. It is not a transcript of evidence. It is a transcript of argument, and even then, in an interlocutory application. I cannot judge with precision what use might be made of the arguments put here for the purposes of the WA proceeding, but judging by the pleadings, and the commonality of the allegations concerning things said and done in the respondents’ pursuit of the exploration and mining interests, there is sufficient to conclude he has an apparent interest in this application; at least an interest sufficient to say there appears to be no real risk that the transcript is being sought for improper or dubious purposes. Moreover, I think ‘the bird has flown.’ The respondents raised no objection to his presence in Court for the duration of the application.
For those reasons I would first, disallow the respondents’ objection and shall notify the transcript provider that the Court does not disapprove Mr Zuks being provided with a transcript of the hearing. Secondly, I would refuse the respondents’ application for an order that the Court file in this proceeding be classified as confidential to the parties.
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