Caveat Pty Ltd v Baillie

[2002] WASC 271

CAVEAT PTY LTD -v- BAILLIE & ORS [2002] WASC 271

Jurisdiction:	SUPREME COURT OF WESTERN AUSTRALIA	Citation No:	[2002] WASC 271
Case No:	COR:14/2002	Heard:	24 OCTOBER 2002
Coram:	MASTER SANDERSON	Delivered:	19/11/02
No of pages:	8	Judgment Part:	1 of 1
Result:	Form of order settled
Category:	B
PDF Version

Parties:	CAVEAT PTY LTD (ACN 008 990 752) JOHN ALLEN BAILLIE CHARLES PHILIP MOSTERT PAUL GERARD MAZAK ROBERT WILDE ROBERT WILTSHIRE BELL MANFRED RICHARD MARX MAJESTIC RESOURCES NL (ABN 16 050 541 332)
Catchwords:	Practice and procedure Form of order Turns on own facts
Legislation:	Nil
Case References:	Nil Nil

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION : CAVEAT PTY LTD -v- BAILLIE & ORS [2002] WASC 271 CORAM : MASTER SANDERSON HEARD : 24 OCTOBER 2002 DELIVERED : 19 NOVEMBER 2002 FILE NO/S : COR 14 of 2002 MATTER : MAJESTIC RESOURCES NL (ABN 16 050 541 332) BETWEEN : CAVEAT PTY LTD (ACN 008 990 752)

Plaintiff

AND

JOHN ALLEN BAILLIE
First Defendant

CHARLES PHILIP MOSTERT
Second Defendant

PAUL GERARD MAZAK
Third Defendant

ROBERT WILDE
Fourth Defendant

ROBERT WILTSHIRE BELL
Fifth Defendant

MANFRED RICHARD MARX
Sixth Defendant

MAJESTIC RESOURCES NL (ABN 16 050 541 332)
Seventh Defendant

(Page 2)

Catchwords:

Practice and procedure - Form of order - Turns on own facts

Legislation:

Nil

Result:

Form of order settled

Category: B

Representation:

Counsel:

Plaintiff : Mr M D Howard
First Defendant : Mr A W Fairweather
Second Defendant : Mr A W Fairweather
Third Defendant : Mr A W Fairweather
Fourth Defendant : Mr N K Stewart
Fifth Defendant : Mr N K Stewart
Sixth Defendant : Mr A W Fairweather
Seventh Defendant : Mr M L Bennett

Solicitors:

Plaintiff : Clayton Utz
First Defendant : Bennett & Co
Second Defendant : Bennett & Co
Third Defendant : Bennett & Co
Fourth Defendant : Pullinger Readhead Stewart
Fifth Defendant : Pullinger Readhead Stewart
Sixth Defendant : Bennett & Co
Seventh Defendant : Fearis Salter Power Shervington

(Page 3)

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

Nil

Case(s) also cited:

Nil

(Page 4)

1 MASTER SANDERSON: This is the third set of reasons I have published in relation to this matter. What is presently to be resolved is the form of the order which is to give effect to my reasons. Discussions between the parties have led to a large measure of agreement but there are still one or two issues to be resolved.

2 At present the plaintiff proposes orders in the following terms:

"1. Within 28 days of this order:

1.1 the seventh defendant make available:


(a) to Robert John Russell, Martin Paul Langridge and in his absence Richard Michael Thomas of Delloite Touche Tohmatsu, and Kevin Anthony Dundo in his absence David Jonathan Hargreaves of Clayton Utz, on behalf of the plaintiff;

(b) at its principal place of business; and

(c) between 9.00am to 5.00pm each business day for 21 business days,

documents of the seventh defendant which fall into the categories in the List of Documents annexed hereto marked 'A', save for those documents in respect of which a defendant makes a claim for privilege;


1.2 the seventh defendant serve on the plaintiff a list of any document in the List of Documents annexed hereto marked 'A' in respect of which a defendant makes a claim for privilege, setting out the basis for the claim and the defendant who makes the claim;

1.3 the seventh defendant make and serve on the plaintiff a list of any of its documents which fall into the categories in the List of Documents annexed hereto marked 'A' which are not within Western Australia, setting out the location of those documents and the times at which they may be inspected;

2. The plaintiff may request the seventh defendant to provide a copy of any document made available for inspection; and

(Page 5)

2.1 the seventh defendant must, within 3 days of the date of that request, provide a copy of that document to the plaintiff, or provide written reasons as to why it refuses to provide a copy of the document;

2.2 the plaintiff will pay the seventh defendant's costs of photocopying any document at the rate of 50c per page; and

2.3 such copy shall thereafter be kept secure in the plaintiff's solicitors' possession and control and be marked 'confidential - disclosure restricted by order of the Court';

2.4 if the plaintiff does not proceed with its proposed application under section 237 of the Corporations Act, the plaintiff will return to the seventh defendant any copy documents provided to it by the seventh defendant within 14 days of electing not to proceed.

3. All documents made available for inspection, copies of such documents and the information the subject of these documents shall be kept strictly confidential by the Authorised Person and any disclosure of a document or any of its contents may only be made:

3.1 as between Authorised Persons; or

3.2 to this Court;

being for the purpose of an application or any proposed application by the plaintiff under section 237 of the Corporations Act to commence a proceeding against a defendant.

4. To facilitate the purpose set out in paragraph 3, the plaintiff's solicitors may make a further copy or copies of a document copied pursuant to these orders, to:

4.1 produce that document to this Honourable Court; or brief counsel or an expert engaged by the plaintiff for the purpose of such proceedings provided that the plaintiff's solicitors maintain a register which records:


(a) the number of copies made; and

(Page 6)

(b) the person to whom such a copy has been supplied,

such register to be available for inspection by a defendant on 24 hours written notice;

5. In these orders, 'Authorised Persons' means Robert John Russell, partners of, and solicitors and articled clerks employed by Clayton Utz and independent barristers and/or any independent expert engaged on behalf of the plaintiff in the conduct of these proceedings.

6. Liberty to any party to apply generally on 48 hours written notice;

7. Seventh defendant pay the plaintiff's costs of this application;

8. These orders be stayed for 21 days."

3 The seventh defendant disputes a number of these orders. With respect to order 1.1(a), it is said by the seventh defendant that the books should be inspected by Robert John Russell and one other nominated person. That, it is said, is consistent with s 247A(4) of the Corporations Act. Section 247A(4)(b) allows the Court to make an order authorising "another person to inspect books of the company on the applicant's behalf". In my view that does not restrict the order made to one other person. I am of the view that the persons who are so authorised should be named in the order. That has been done. The plaintiff does not propose that a wide range of persons inspect the books, rather that the inspection be undertaken by a director of the plaintiff, an accountant and a solicitor. In my view that is proper and an order in terms of par 1.1(a) should be made.

4 The submissions made by the parties indicate that there is a dispute about par 1.1(c) of the orders. However, it is not entirely clear as to precisely what is the nature of that dispute. In any event, I am satisfied that the form of order proposed by the plaintiff is appropriate and I would make an order in terms of par 1.1(c) of the minute.

5 By par 1.3 the plaintiff would have the seventh defendant make "a list of its documents which fall into the categories in the List of Documents" annexed to the order. These are the documents held by the seventh defendant out of the jurisdiction and, on the evidence, in Southern

(Page 7)

Africa. The plaintiff, concerned about the cost of inspecting these documents, wants to know with some accuracy what documents are involved so that it can decide whether or not to travel to Africa to undertake the inspection. For its part, the seventh defendant proposes that it make and serve a list containing "a description of the categories of its documents constituting documents in the List of Documents". In my view the seventh defendant's version is to be preferred. To require a complete list of the documents would, in my view, be oppressive and not in line with what is required by the Act. Accordingly, par 1.3 of the order will be in the terms proposed by the seventh defendant's solicitors.

6 The final matter of dispute between the parties relates to who should be permitted to see copies of documents obtained by the plaintiff. The essential difference between the plaintiff and the seventh defendant is that the plaintiff wants to be in a position where it can provide copies of the document to an independent expert with a view to obtaining an opinion or otherwise considering its position. That has led to a dispute over par 3, par 4 and the definition of "Authorised Persons" found in par 5. I am satisfied that the plaintiff's position is to be preferred. In my view it should be permitted to refer the documents to an independent expert for all legitimate purposes.

7 There then remains the dispute about the form of annexure "A" to the order. The seventh defendant has filed a marked-up copy of this annexure, the original having been prepared by the plaintiff. Without going through the annexure in detail, it is fair to say that the seventh defendant would have the list of documents in far more general terms than would the plaintiff. By way of example, par 1 of the annexure, as the plaintiff would have it, reads as follows:

"All documents in the possession of Majestic Resources NL ABN 16 050 541 332 ('Majestic') relating to the takeover bid for NDC (Namakwa Diamond Company) including, all documents relating to the preparation of Majestic's bidder's statement and supplementary bidder's statement, and all documents which relate to any negotiations with any directors, employees or shareholders of NDC".

8 For their part, the seventh defendant would have this paragraph in the following form:

(Page 8)

"All of Majestic Resources NL ABN 16 050 541 332 ('Majestic') (non-privileged) books relating to the takeover bid for NDC."

9 On balance, I am satisfied that the seventh defendant's form of the list is to be preferred. As I have indicated in my earlier reasons, I am not satisfied that the Corporations Act allows the Court to order inspection of particular books of the company. What is authorised is a general order. That position is, in my view, more accurately reflected in the form of annexure "A" proposed by the seventh defendant.

10 There is also the question of the books which are privileged. It is, I think, appropriate that annexure "A" make reference to production of non-privileged books even though given the way that the order itself is worded, there can be little doubt on this question. Furthermore, the wording of the seventh defendant's version of annexure "A" does, I think, offer protection to the other defendants who are concerned about the disclosure of documents which may be privileged in their hands. Counsel for the fourth and fifth defendants in particular has raised this point. In my view, it is adequately covered in the form of the annexure proposed by the seventh defendant.

11 The solicitors for the plaintiffs ought bring in a minute which reflects these further reasons and I will make orders accordingly.