Caratti -v- Boban Pty Ltd (Administrators Appointed) - [2015] WASC 118

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: CARATTI -v- BOBAN PTY LTD (ADMINISTRATORS APPOINTED) [2015] WASC 118

CORAM: MITCHELL J

HEARD: 26 MARCH 2015

DELIVERED : 26 MARCH 2015

PUBLISHED : 2 APRIL 2015

FILE NO/S: COR 60 of 2014

BETWEEN: ALLEN BRUCE CARATTI
Plaintiff
AND
BOBAN PTY LTD (ADMINISTRATORS APPOINTED)
First Defendant
PINEVIEW INVESTMENTS PTY LTD (ADMINISTRATORS APPOINTED)
Second Defendant
AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION
Third Defendant
JAMIE KEVIN POLLOCK
Fourth Defendant
JOHN SHEAHAN AND IAN RUSSELL LOCK AS JOINT AND SEVERAL ADMINISTRATORS OF BOBAN PTY LTD
Fifth Defendant
JOHN SHEAHAN AND IAN RUSSELL LOCK AS JOINT AND SEVERAL ADMINISTRATORS OF PINEVIEW INVESTMENTS PTY LTD
Sixth Defendant

Catchwords:

Practice and procedure - Discovery - Application for discovery of documents relevant to contempt allegation - Privilege against selfincrimination

Legislation:

Nil

Result:

Application allowed in part

Category: B

Representation:

Counsel:

Plaintiff:     Mr N D C Dillon
First Defendant             :     No appearance
Second Defendant         :     No appearance
Third Defendant           :     No appearance
Fourth Defendant          :     Mr J E Scovell
Fifth Defendant            :     Mr T J Porter
Sixth Defendant            :     Mr T J Porter

Solicitors:

Plaintiff:     Roe Legal Services
First Defendant             :     No appearance
Second Defendant         :     No appearance
Third Defendant           :     No appearance
Fourth Defendant          :     Mills Oakley Lawyers
Fifth Defendant            :     Sheahan Lock Partners
Sixth Defendant            :     Sheahan Lock Partners

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

Australian Competition and Consumer Commission v FFE Building Services Ltd [2003] FCAFC 132; (2003) 130 FCR 37
Bridal Fashions Pty Ltd v Comptroller‑General of Customs (1996) 17 WAR 499
CFMEU v Boral Resources (Vic) Pty Ltd [2013] VSCA 378
CFMEU v Grocon Constructions (Victoria) Pty Ltd [2014] VSCA 261
Coco v The Queen (1994) 179 CLR 427
Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission [2002] HCA 49; (2002) 213 CLR 543
Environmental Protection Authority v Caltex Refining Co Pty Ltd (1993) 178 CLR 477
Exagym Pty Ltd v Professional Gymnasium Equipment Company Pty Ltd (No 2) [1994] 2 Qd R 129
Lee v NSW Crime Commission (2013) 251 CLR 196
MacDonald v Australian Securities and Investments Commission [2007] NSWCA 304, (2007) 73 NSWLR 612
NSW Food Authority v Nutricia Australia Pty Ltd [2008] NSWCCA 252; [2008] 72 NSWLR 456
Pelechowski v Registrar, Court of Appeal [1999] HCA 19; (1999) 198 CLR 435
R v Associated Northern Collieries (1910) 11 CLR 738
Rich v Australian Securities and Investments Commission [2004] HCA 42; (2004) 220 CLR 129
Witham v Holloway (1995) 183 CLR 525
Woods v Skyride Enterprises Pty Ltd [2012] WASC 4
X7 v Australian Crime Commission (2013) 248 CLR 92
MITCHELL J:
(This judgment was delivered extemporaneously on 26 March 2015 and has been edited from the transcript.)

Procedural history

The plaintiff applies for discovery of the following documents:
(a)from the fourth, fifth and sixth defendants, all documents evidencing any communications with the Australian Taxation Office or the Deputy Commissioner of Taxation since 1 April 2014 relating in any way to the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2015] WASC 118
Decision Date: 2 APRIL 2015

CaseChat Overview and Summary

Caratti v Boban Pty Ltd (Administrators Appointed) was a case heard by the Supreme Court of Western Australia, where the plaintiff sought discovery of documents in relation to an allegation of contempt against the defendant company and its director. The court was tasked with determining whether certain legal privileges, such as the privilege against self-incrimination and the privilege against exposure to penalties, could be overridden by general discovery provisions in the Supreme Court Rules. The primary legal issue was whether the general terms of Order 26 of the Supreme Court Rules 2005 (WA) and Section 167 of the Supreme Court Act 1935 (WA) allowed for the exclusion of these privileges without explicit legislative direction.

The court found that the general terms of Order 26 of the Rules and Section 167 of the Act did not indicate an intention to abrogate the privileges against self-incrimination or exposure to penalties. The historic context of these privileges, which originated in the rules of equity relating to discovery, was considered crucial. The court held that these well-established privileges could only be excluded expressly or by necessary implication in relevant legislation. The court noted that the Victorian Court of Appeal had taken a different view in CFMEU v Grocon Constructions (Victoria) Pty Ltd, suggesting that discovery could be ordered against a corporate respondent in certain circumstances. However, the Supreme Court of Western Australia distinguished the present case from Grocon, finding that the corporate respondent in this case could indeed claim privilege.

Ultimately, the court ruled that the privileges against self-incrimination and exposure to penalties were not abrogated by the general terms of the Supreme Court Rules and Act. The application for discovery was dismissed, as the court found no express or necessary implication in the relevant legislation to exclude these privileges. This decision aligns with the broader legal principle that fundamental common law rights, such as the privilege against self-incrimination, can only be overridden by clear legislative intent.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

Similar to the privilege against self-incrimination are the privileges against exposure to penalties and forfeiture which had their origins in the rules of equity relating to discovery but came to be also recognised as rules of the common law.[7] Those privileges are also only able to be excluded expressly or by necessary implication in the relevant legislation.[8][7] See Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission [2002] HCA 49; (2002) 213 CLR 543 [13]. [8] Daniels [11], [16]. There is nothing in the general terms of O 26 of the Rules sufficient to indicate an intention to abrogate the privileges against self‑incrimination or exposure to penalties. Nor is there anything in the general words of s 167 of the Supreme Court Act 1935 (WA) to indicate an intention to authorise rules of court which would abrogate those fundamental common law rights. The fact that the rule about the privilege against exposure to penalties had its origins in the approach of courts exercising equitable jurisdiction to bills for discovery in aid of penal suits provides an important context against which the general language of the rules is to be construed.[9] Given that historic background, it can hardly be supposed that the well‑established position that discovery not be ordered against a respondent to penal proceedings was to be abolished by a side‑wind without being expressly addressed.[9] For a history of the rules see R v Associated Northern Collieries (1910) 11 CLR 738, 741 ‑ 748. In CFMEU v Grocon Constructions (Victoria) Pty Ltd,[10] the Victorian Court of Appeal appeared to favour the view that discovery could in some cases be ordered against a corporate respondent to a contempt application, subject to the sound exercise of judicial discretion. However, that conclusion was very much based upon the view of the court that the corporate respondent in that case could not, in law, claim any privilege in answer to an order for discovery.[11] I note that special leave has been granted to appeal against the decision in Grocon to the High Court, but that the appeal has not been resolved.[10] CFMEU v Grocon Constructions (Victoria) Pty Ltd [2014] VSCA 261.[11] Grocon [502]; Environmental Protection Authority v Caltex Refining Co Pty Ltd (1993) 178 CLR 477. A case closer to the present is Rich v Australian Securities and Investments Commission.[12] The issue raised in that case concerned whether discovery should have been ordered against directors of a company in the primary proceedings. In the primary proceedings, the Commission sought declarations that the directors had contravened a statutory duty requiring them to exercise their powers and discharge their duties with reasonable care and skill. The Commission also sought orders for compensation to the company concerned and orders that the directors be disqualified from managing a corporation. [12] Rich v Australian Securities and Investments Commission [2004] HCA 42; (2004) 220 CLR 129.