Bridge Street Capital No. 2 Pty Ltd v Crown

[2025] NSWSC 938

Supreme Court

New South Wales

Medium Neutral Citation:

Bridge Street Capital No. 2 Pty Ltd v Crown [2025] NSWSC 938

Hearing dates:

15 August 2025

Date of orders:

15 August 2025

Decision date:

15 August 2025

Jurisdiction:

Equity - Real Property List

Before:

Pike J

Decision:

(1)   In respect of the documents listed in Schedule 1 of this Motion (except documents 42 to 44, 53 and 54), the Plaintiffs be released from the implied undertaking that such documents only be used for the purposes for which they were disclosed, such that the Plaintiffs are permitted to use the said documents:

(a)   in Supreme Court of New South Wales proceedings No. 2025/198353 (including any cross-claim); and/or

(b)   in fresh proceedings commenced by one or both the Plaintiffs which relate to or concern the loan advanced by the Plaintiffs to the Cross-Claimants on 3 May 2022.

(2)   No order as to costs to the intent that each party bear its own costs.

(3)   Make an interim order under the Court Suppression and Non-publication Orders Act 2010 that the documents in volume 3 of the exhibit to the affidavit of Vanessa Vallejo of 14 July 2025 be suppressed and not published until 4pm today.

Catchwords:

CIVIL PROCEDURE – Implied undertakings – Release from – Special circumstances – whether special circumstances exist

Legislation Cited:

Nil

Cases Cited:

Liberty Funding Pty Ltd v Phoenix Capital Ltd (2005) 218 ALR 283; [2005] FCAFC 3

Papantoniou v Stonewall Hotel Pty Ltd (2018) 19 BPR 38,547; [2018] NSWCA 85

Springfield Nominees Pty Ltd v Bridgelands Securities Ltd (1992) 38 FCR 217

Unicomb v Blais (2024) 115 NSWLR 155; [2024] NSWSC 903

Texts Cited:

Nil

Category:

Procedural rulings

Parties:

Bridge Street Capital No. 2 Pty Ltd (First Plaintiff / First Applicant)
Saddleback Mountain Estates No.2 Pty Ltd (Second Plaintiff / Second Applicant)
Thomas Peter Crown (First Respondent)
Netherfield Holdings Pty Ltd (Second Respondent)
TPC Industries Pty Ltd (Third Respondent)
Angelwood Investments Pty Ltd (Fourth Respondent)
Coronam Holdings Pty Ltd (Fifth Respondent)
Vanessa Ann Crown (Sixth Respondent)
Resilient Investments Holdings Pty Ltd (Seventh Respondent)
Resilient Investment Group Pty Ltd (Eighth Respondent)
Evandale Property Pty Ltd (Ninth Respondent)
Leets Vale Property Pty Ltd (Tenth Respondent)
Mereworth Property Pty Ltd (Eleventh Respondent)
Panawanica Property Pty Ltd (Twelfth Respondent)
Aydin Acar trading as A I Legal (Thirteenth Respondent)
Camden Stockyard Group Pty Ltd A.C.N 657 560 060 (Fourteenth Respondent)
The East HWL Practice Trust & The Warat HWL Practice Trust & The Marin HWL Practice
Trust & Others trading as HWL Ebsworth Lawyers (Fifteenth Respondent)
JHK Legal Australia Pty Ltd A.C.N 164 726 407 (Sixteenth Respondent)
H&H Mezz Pty Ltd A.C.N 605 20 348 (Seventeenth Respondent)
Macquarie Bank Limited ABN 46 008 585 542 (Eighteenth Respondent)

Representation:

Counsel:
A Oakes (Plaintiffs / Applicants)
K McCallum (First to Twelfth Respondents – Crown Parties)

Solicitors:
VMV Lawyers (Plaintiffs / Applicants)
FCW Lawyers (First to Twelfth Respondents – Crown Parties)

File Number(s):

2023/00043873

Publication restriction:

Nil

JUDGMENT (ex tempore revised from transcript)

1. By motion filed 14 July 2025, the plaintiffs seek orders, in effect, releasing them from the implied undertaking in relation to the documents listed in schedule 1 to the motion. There are 78 documents set out in that schedule. Those documents can broadly be grouped into three categories:

1. disclosure given by the first to 12th respondents (Crown Parties) - in the proceedings;

2. documents 42 to 44 in the schedule which are documents that were included in evidence served in the proceedings by the Crown Parties pursuant to earlier orders of the Court; and

3. documents produced on subpoena by third parties.

2. In support of the orders sought in the notice of motion, the plaintiffs rely upon two affidavits of Vanessa Vallejo (Ms Vallejo), the plaintiffs’ solicitor. The first is sworn 14 July 2025 and the second is sworn on 30 July 2025.

3. There are three folders of exhibits to the first affidavit which have been tendered. In respect of volume 3 of the exhibit I made an interim confidentiality and non-publication order which expires at 4pm today. This is on the basis that the Crown Parties contend that the documents contained in that folder are confidential.

4. In opposition to the orders sought in the motion, the Crown Parties rely upon an affidavit of Thomas Peter Crown of 14 August 2025. That affidavit was read without objection.

5. None of the deponents whose evidence was relied upon on the motion was required for cross-examination.

6. On the application this morning Mr Oakes of counsel appears for the plaintiffs and Ms McCallum of counsel appears for the Crown Parties. They have addressed me orally and I have also had the benefit of written submissions provided to me in advance of the hearing.

7. Mr Oakes also handed up at the commencement of the hearing today a schedule which was euphemistically referred to by the parties during the course of the argument as a “Scott Schedule” which identifies each of the 78 documents and groups together in summary form the basis of the objection raised by the Crown Parties and the plaintiffs’ response to that objection.

Relevant Principles

8. The circumstances in which the Court will release a party from the implied undertaking – more accurately described as the Hearne v Street obligation - are well-known.

9. The Court may release a party from the obligation where that party can demonstrate “special circumstances”: see Springfield Nominees Pty Ltd v Bridgelands Securities Ltd (1992) 38 FCR 217 at 225 per Wilcox J (Springfield Nominees).

10. If the Court does find special circumstances, then it has a broad discretion whether or not to grant leave: see Papantoniou v Stonewall Hotel Pty Ltd (2018) 19 BPR 38,547; [2018] NSWCA 85 at 38,553 (per Barrett AJA with whom Beazley P and Ward JA agreed).

11. Special circumstances do not require extraordinary factors. Instead, “good reason must be shown why, contrary to the usual position, documents produced or information obtained in one piece of litigation should be used for the advantage of a party in another piece of litigation or for other non-litigious purposes”: see Liberty Funding Pty Ltd v Phoenix Capital Ltd (2005) 218 ALR 283; [2005] FCAFC 3 at [31] (per Branson, Sundberg and Allsop JJ).

12. In Springfield Nominees at 225, Wilcox J identified matters which Courts regard as relevant in determining whether to exercise the discretion. The identified matters are:

1. the nature of the documents;

2. the circumstances under which the document came into existence;

3. the attitude of the author of the document and any prejudice the author may sustain;

4. whether the document pre-existed litigation or was created for that purpose and therefore expected to enter the public domain;

5. the nature of the information in the document (in particular whether it contains personal data or commercially sensitive information);

6. the circumstances in which the document came into the hands of the applicant; and

7. most importantly of all, the likely contribution of the document to achieving justice in the other proceeding.

13. In Unicomb v Blais (2024) 115 NSWLR 155; [2024] NSWSC 903 (Unicomb), McGrath J held at [230]-[251], that the implied undertaking does not apply to evidence served by a party pursuant to an ordinary timetabling order to provide any affidavits that the party intends to rely on at the hearing. His Honour held that that is not a relevant compulsion for the purposes of the application of the implied undertaking. That principle has relevance to three documents in the schedule.

Brief Overview of the Facts

14. It is not necessary for the purposes of this application to descend into any great detail as to the relevant facts. It is sufficient to note for present purposes that each of the documents in question were provided to the plaintiffs in these proceedings either by way of disclosure, service of evidence or third party subpoenas.

15. These proceedings related to a loan advance made by the plaintiffs to the Crown Parties to provide funding to complete the purchase of properties located in the New South Wales Southern Highlands and associated water licences.

16. The proceeding initially concerned enforcement of an undertaking given by the borrowers and related entities to discharge certain mortgages which were required to be discharged as part of the loan transaction but were not. A cross-claim was filed by the borrowers seeking among other things, relief or rescission or avoidance of the loan agreement on the basis of misleading or deceptive conduct and unconscionable conduct.

17. The plaintiffs were junior lenders. The senior lender was MC Coronam Pty Ltd as trustee for the MC Coronam Fund (MC Coronam). An Intercreditor Deed was entered into between MC Coronam, the plaintiffs and the Crown Parties outlining their respective rights and obligations. The proceeding was ultimately resolved without a final hearing with final orders made on 6 March 2025. A deed of settlement was entered into between the parties. It seems to be common ground on the present application that at least some of the obligations under that deed of settlement have not yet been complied with.

18. A point was initially raised by the Crown Parties in opposition to the release from the undertaking that the effect of the deed of settlement would be that the plaintiffs are barred from bringing further proceedings against the Crown Parties by reason of the deed. Ms McCallum of counsel accepts that the time for the determination of whether there is any relevant bar to the commencement of fresh proceedings is at the time that those fresh proceedings are in fact commenced, and that the terms of the deed of settlement and whether a bar applies to future proceedings, is not relevant to the present application.

19. The documents for which release is sought are said to be relevant to the defence of separate proceedings which had been commenced against them, described as the MC Coronam proceedings or the bringing of a cross-claim or separate proceedings either against MC Coronam or another third party or third parties. The proceedings commenced by MC Coronam concern the rights under the Intercreditor Deed.

20. Ms Vallejo in her affidavit sets out the nature of the proposed further proceedings or cross-claims in the existing MC Coronam proceedings.

21. I need not descend, in these reasons, into the detail of those proposed new proceedings or cross-claims. Mr Oakes of counsel helpfully summarised those proceedings as falling within four groups:

1. a claim against the MC Coronam interests for inducing a breach of contract in relation to what was described as the H&H Mezzanine Refinance;

2. a claim against HWLE Lawyers for misleading or deceptive conduct in relation to the H & H Mezzanine Refinance;

3. a further claim for misleading or deceptive conduct against HWLE Lawyers in relation to the terms and conditions contained in a contract for the sale of land for a property described as the Camden property; and

4. a further claim for misleading and deceptive conduct against HWLE Lawyers in relation to the source of the deposit used by the Crown Parties to pay the deposit on seven properties in Berrima.

22. It is accepted that these claims do not relate directly to the two properties that are in issue in the MC Coronam proceedings but they are related to the same transaction.

Determination

23. In relation to the documents at 42 to 44 in the schedule it is clear that they were served pursuant to an order of the Court as part of the Crown Parties’ evidence, and that having regard to the decision of McGrath J in Unicomb that I have referred to above, no implied undertaking applies to those documents. It is therefore not necessary for any order granting a release in respect of those documents.

24. In relation to the documents produced on subpoena by third parties, it is of some significance that none of those third parties raise any opposition to the release from the implied undertaking. Ms Vallejo’s evidence sets out the position in relation to each of the third parties and they either consent to the orders or in effect do not wish to be heard in opposition to them. In my view this is of some significance in considering the present application.

25. In relation to the remaining documents and also the documents produced on subpoena, the principal objection raised by the Crown Parties concerned the relevance of those documents to the proposed defence of the MC Coronam proceedings or the commencement of cross-claims or fresh proceedings against MC Coronam or HWLE Lawyers.

26. Issues of confidentiality were also raised by the Crown Parties and also concerns in relation to an unfettered restriction on the plaintiffs being able to use the documents if there is a release from the implied undertaking. The motion only seeks a limited release from the implied undertaking - namely to enable the documents to be used either in the MC Coronam proceedings or in fresh proceedings. This to my mind deals with the concerns in relation to an unfettered restriction. There will be no unfettered restriction. The release from the implied undertaking will be for the limited purposes identified. Indeed, in the MC Coronam proceedings or any fresh proceedings, the documents will again be subject to an implied undertaking restricting their use.

27. In relation to any broad suggestion by the Crown Parties that the material is confidential, I am not satisfied that there is any evidence before the Court that would justify any form of confidentiality order. It does not seem to me, having briefly reviewed the documents, that the documents are confidential in the relevant sense. No probative evidence has been put before the Court to suggest, for example, that disclosure of the material to the plaintiffs would cause any irremediable prejudice to the Crown Parties. Mr Thomas Crown in his affidavit has just made general assertions of commercial sensitivity unrelated to any particular aspect of any particular document. It is also of some significance in this regard, that none of the subpoenaed parties have sought to contend that any confidentiality orders should be made.

28. Turning to the question of relevance, it is to be remembered that the relevant question, having regard to the discretionary factors set out by Wilcox J in Springfield Nominees, is the likely contribution of the document to achieving justice in the other proceeding. This is not imposing a bright line test such, as was suggested on the present application, as would apply to the tender of evidence under the Evidence Act1995 (NSW), or to the need for a party to give discovery in proceedings. It involves an evaluation by the Court as to the likely relevance of the documents to the proposed intended use. It is also not necessary for the plaintiffs to propose a draft pleading at this stage.

29. In this regard, Ms Vallejo has set out in her affidavit in some detail the nature of the documents and the relevance of them to the proposed MC Coronam proceedings or the related new proceedings. Whilst I accept that the evidence does not descend into minute detail in this regard, I am not satisfied that it needs to. Having regard to what is set out in Ms Vallejo’s affidavit evidence, together with the submissions contained in the third column of the Scott Schedule, and the written and oral submissions of Mr Oakes, I am satisfied, save for two documents - being documents 53 and 54 in the schedule - that they are likely to contribute to achieving justice in the MC Coronam proceedings or the foreshadowed new associated proceedings. The fact that the foreshadowed claims do not relate to the two properties at issue in the MC Coronam proceedings is no answer to relevance. It is the relevance of the documents to the intended use – the cross claims or fresh proceedings – that is important.

30. Documents 53 and 54 in the schedule do not appear to me to be relevant in any real way to the proposed cross-claims or fresh proceedings.

31. None of the other discretionary factors identified in Springfield Nominees weigh against a release - they tend to favour it.

32. Turning first to the nature of the documents in question, they are largely transactional documents and associated communications between the transacting parties and account statements. They are not internal documents in the sense of documents that if they were disclosed publicly, the disclosure would cause harm to the owner of the document.

33. Second, the circumstances under which the documents came into existence - each of the documents on their face appear to be a document that has come into existence in the ordinary course of business of the respective owner of the document.

34. In terms of the attitude of the authors of the documents and any prejudice the authors may sustain - as I have set out above, none of the subpoenaed parties seek to oppose the release. Whilst the Crown Parties have opposed the release, I am not satisfied that any prejudice would be caused to the Crown Parties if they were released for the limited purpose sought.

35. Insofar as it was suggested that there may be claims for privilege made by the Crown Parties, it seems to me that to the extent that there was any potential claim for privilege in relation to any of the documents - and I am not satisfied that there was - any privilege attaching thereto would have been waived. The time for making the claim for privilege would have been at the time that disclosure was sought in these proceedings so as to prevent the documents being provided to the plaintiffs.

36. Turning to the question of whether the documents pre-existed the litigation or were created for that purpose - it seems clear that the documents were created prior to the Crown proceedings and were not on their face, created for the purpose of that litigation. I agree with the submission advanced by the plaintiffs that while the documents may not have been expressly contemplated to enter the public domain, it would have been well-understood by the creators of the documents that the documents could at some stage become relevant to court proceedings and be the subject of some form of compulsory process of disclosure. There does not seem to me to be any basis on which the Court would make a non-publication or suppression order if it was sought to tender the documents in any public hearing.

37. Turning to the nature of the information in the documents - they relate to commercial transactions. They do not appear to me to contain any personal data of a kind that weighs against granting the release sought, particularly in circumstances where the release is a limited release and the plaintiffs would remain subject to an implied undertaking in the new proceedings in relation to the use of the documents.

38. In relation to the circumstances in which the documents came into the hands of the applicants - they were obtained by subpoena, discovery and evidence in the Crown proceedings.

Conclusion

39. I am satisfied that special circumstances have been demonstrated. There is no discretionary reason as to why the requested release should not be ordered.

40. For these reasons I am satisfied that the orders sought in the notice of motion should be made in respect of all of the documents listed in schedule 1 to the motion save for documents 42 to 44, 53 and 54 and I so order.

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Decision last updated: 18 August 2025