Clone Pty Ltd v Players Pty Ltd (in Liquidation Receivers Appointed) & Ors - [2012] SASC 12

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application)
CLONE PTY LTD v PLAYERS PTY LTD (IN LIQUIDATION RECEIVERS APPOINTED) & ORS
[2012] SASC 12
Judgment of The Honourable Justice Kourakis
3 February 2012
PROCEDURE - CONTEMPT, ATTACHMENT AND SEQUESTRATION - CONTEMPT - WHAT CONSTITUTES - BREACH OF UNDERTAKING TO COURT
PROCEDURE - DISCOVERY AND INTERROGATORIES - DISCOVERY AND INSPECTION OF DOCUMENTS - PRODUCTION AND INSPECTION - GROUNDS FOR RESISTING PRODUCTION - CLIENT LEGAL PRIVILEGE
Clone Pty Ltd (Clone) and Players Pty Ltd (in liquidation) (receivers appointed) (Players, collectively the Players Parties) had a dispute over the ownership of various liquor and gaming licences – a trial proceeded before a judge of the Supreme Court who found in favour of Clone – an important factual finding at trial concerned the form of a lease agreement (the Agreement) when it was executed by the principals of Players – orders were made by the trial Judge effecting the transfer of the licences from Players to Clone.
The Players Parties seek to set aside those orders by a new action and an application brought in the concluded action following the finding of additional photocopies of the Agreement after trial – whether other recently-discovered evidence of communications between Clone’s legal representatives was reasonably capable of showing that they had abused trial procedures in order to prevent the Players Parties discovering the Agreement – whether the Players Parties are bound by the rule of preclusion preventing the use of the documents in any proceedings other than the taxation of costs – whether the internal documents evidence communications which are protected by litigation privilege.
Held: Application for permission to use internal documents dismissed – the internal documents are privileged and are covered by the rule of preclusion – there are insufficient grounds to exempt the Players Parties from the rule - the production of documents on a taxation of costs pursuant to the rules of the Court waives litigation privilege in those documents only for the limited purpose of the taxation.
There is no evidence of improper conduct by Clone’s legal representatives and no prima facie case that the privileged communications were made for an improper purpose
Supreme Court of Judicture Act 1873 (UK) s 16; Supreme Court of Judicature Act 1875 (UK); Supreme Court Act 1935 s 6, s 17, s 17(1), s 17(2), s 25, s 40, s 42, s 43, s 50, s 72; Supreme Court Act 1855-6 s 7, s 8, s 18, s 19; The Third Judge and District Court Act 1858 -; The Equity Act 1866 s 9, s 11, s 153; The Fourt Judge Act 1919 -; Supreme Court Act Amendment Act 1865 -; The Court of Appeals Amendment Act 1865 s 2; Supreme Court Act 1867 s 31; Supreme Court Act 1878 s 5, s 7, s 15, s 16, s 17; The Commonwealth of Australia Constitution Act s 73; Supreme Court Procedure Act 1853 s 175, s 176, referred to.
Bright v Eynon (1757) 1 Burr 390; 97 ER 365; Monroe Schneider Associates (Inc) v No 1 Raberem Pty Ltd [No 2] (1992) 109 ALR 137; Wollongong Corporation v Cowan (1955) 93 CLR 435; Orr v Holmes (1948) 76 CLR 632; CDJ v VAJ (1998) 197 CLR 172; Smith v New South Wales Bar Association (1992) 176 CLR 256; Harrison v Schipp (2002) 54 NSWLR 612; DJL v The Central Authority (2000) 201 CLR 226; Hip Foong Hong v H. Neotia & Co [1918] 1 AC 888; Eastman v The Queen (2000) 203 CLR 1; Falcke v Scottish Imperial Insurance Company (1887) 57 LT 39; Falcke v Scottish Imperial Insurance Company (1886) 34 Ch D 234; Flower v Lloyd (No 1) (1877) 6 Ch D 297; Flower v Lloyd (No 2) (1879) 10 Ch D 327; Boswell v Coaks (No 2) (1894) 86 LT 365; Re St. Nazaire Co (1879) 12 Ch D 88; Charles Bright & Co Ltd v Sellar [1904] 1 KB 6; Re Scott and Alvarez’s Contract [1895] 1 Ch 596; Re Barrell Enterprises [1973] 1 WLR 19; Venkata Narasimha Appa Row v Court of Wards (1886) 11 App Cas 660; Angas v Cowan (1883) 17 SALR 110; Burns v National Insurance Co of Australasia (1884) 18 SALR 50; Musgrove v McDonald (1905) 3 CLR 132; Re Bleechmore [1925] SASR 112; Burrell v The Queen (2008) 238 CLR 218; Nicholas v The Queen (1998) 193 CLR 173; R v Nam [1968] SASR 107; Mohtar v Mohtar (1988) 146 LSJS 377; Jonesco v Beard [1930] 1 AC 298; Cabassi v Vila (1940) 64 CLR 130; Commonwealth Bank of Australia v Forshaw (1990) 55 SASR 247; T.R.A.M.S. Pty Ltd v The Grand Hotel Pty Ltd (1993) 170 LSJS 312; Money Tree Management Services Pty Ltd v Deputy Commissioner of Taxation [No 4] [2000] SASC 313; Bailey v Marinoff (1971) 125 CLR 529 ; Gamser v Nominal Defendant (1977) 136 CLR 145; University of Wollongong v Metwally [No 2] (1985) 59 ALJR 481; Copping v ANZ McCaughan Ltd (1997) 67 SASR 525; McAdam v Robertson (1999) 73 SASR 360; Byrnes v Kendle [No 2] [2010] SASC 64; Indigo Financial Money Pty Ltd v Bolivar Road Pty Ltd [2011] SASCFC 39; Commonwealth Bank of Australia v Quade (1991) 178 CLR 134; Brookfield v Yevad Products Pty Ltd [2004] FCA 1164; Mann v Carnell (1999) 201 CLR 1; Giannarelli v Wraith [No 2] (1991) 171 CLR 592; State Bank of South Australia v Smoothdale (No 2) Ltd (1995) 64 SASR 224; Pamplin v Express Newspapers Ltd [1985] 1 WLR 689; [1985] 2 All ER 185; Goldman v Hesper [1988] 1 WLR 1238; [1988] 3 All ER 97; Bourns Inc v Raychem Corp [No 3] [1999] 3 All ER 154; Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501; Barclays Bank Plc v Eustice [1995] 4 All ER 511; Attorney-General for the Northern Territory of Australia v Kearney (1985) 158 CLR 500; Hearne v Street (2008) 235 CLR 125; Esso Australia Resources Limited v Plowman (1995) 183 CLR 10 ; Springfield Nominees Pty Ltd v Bridgeland Securities Ltd (1992) 38 FCR 217 , discussed.
Norris v Le Neve (1743) 3 Atk 26; 26 ER 818; Hungate v Gascoyne (1846) 2 Ph 25; 41 ER 850; R v Nam [1968] SASR 107; Musgrove v McDonald (1905) 3 CLR 132 ; South-Eastern Railway Co. v. Smitherman 47 J.P., 773; Isaacs v Hobhouse [1919] 1 KB 398; Jeffrey v Jeffrey (1931) 31 SR (NSW) 535; Thomas v The Crown (1904) 2 CLR 127; National Pictures Ltd v Gibbs, Bright & Co [1925] SASR 358; The Texas Company (Australasia) Ltd v Federal Commissioner of Taxation (1940) 63 CLR 382; Autodesk Inc. v Dyason [No 2] (1993) 176 CLR 300; Hosking v Terry (1862) 15 Moo PC 493; 15 ER 581; Wentworth v Rogers [No 5] (1986) 6 NSWLR 534 ; Re Suffield and Watts; Ex parte Brown (1888) 20 QBD 693; Preston Banking Company v William Allsup & Sons [1895] 1 Ch 141; Re May (1883) 25 Ch D 231; Re May (1885) 28 Ch D 516; Giles v Wooldridge (1879) 13 SALR 185; Solomon v Bitton (1881) 8 QBD 176; Metropolitan Railway Co v Wright (1886) 11 App Cas 152; Hardel Pty Ltd v Burrell & Family Pty Ltd (2009) 103 SASR 408; Woods v Sheriff of Queensland (1895) 6 QLJ 175; The Owners of the S.S. Kalibia v Wilson (1910) 11 CLR 689; FAI General Insurance Co Ltd v Southern Cross Exploration NL (1988) 165 CLR 268; Spies v Commonwealth Bank of Australia (1991) 24 NSWLR 691; Davies v Eli Lilly & Co [1987] 1 All ER 801; Cameron v Cole (1944) 68 CLR 571; Carter v The Managing Partner, Northmore Hale Davy & Leake (1995) 183 CLR 121; Baker v Campbell (1983) 153 CLR 52 ; Attorney-General for the Northern Territory v Maurice (1986) 161 CLR 475; Goldberg v Ng (1995) 185 CLR 83; State Bank of South Australia v Smoothdale (No 2) Ltd (1995) 184 LSJS 254; Cadbury Schweppes Pty Ltd v Amcor Ltd [2008] FCA 88; Australian Competition and Consumer Commission v Construction, Forestry, Mining and Energy Union [2008] FCA 678; Goldberg v Ng (1994) 33 NSWLR 639; Southern Equities Corporation Ltd (in liq) v Arthur Andersen & Co (1997) 70 SASR 166; Yokogawa Australia Pty Ltd v Alstom Power Ltd [2009] SASC 377; (2009) 262 ALR 738; Elders Forestry Ltd v Bosi Security Services Ltd [2010] SASC 226; Duke Group Ltd (in liq) v Pilmer (1993) 60 SASR 29; Australian Securities & Investments Commission v Marshall Bell Hawkins Ltd [2003] FCA 833, considered.

CLONE PTY LTD v PLAYERS PTY LTD (IN LIQUIDATION RECEIVERS APPOINTED) & ORS
[2012] SASC 12
Civil:

KOURAKIS J: Clone Pty Ltd (Clone) at all relevant times owned premises in Pirie Street in the central business district of Adelaide. It leased the premises to Players Pty Ltd (Players) for a period of 10 years commencing in March 1995. Clone and Players first subscribed to an Agreement to Lease (the Agreement) before executing a lease which was registered (the Lease). Players renovated the premises at its own expense and operated it as a bar (the Planet Hotel) which was licensed both to sell alcohol (the liquor licence) and to operate gaming machines (the gaming licence). Jointly I will refer to the liquor licence and the gaming licence as “the licences”. Players had obtained permission to transfer the liquor licence from a bar in Grenfell Street (the Grenfell Tavern) to the Planet Hotel in about September 1994. Players applied for, and obtained, the gaming machine licence for the Planet Hotel as an original grant. The Lease came to an end in particularly acrimonious circumstances. Proceedings were brought by Clone even before the end of the term, claiming that the Lease had been terminated by Clone’s acceptance of Players’ repudiation of the Lease.
The controversy between Players and Clone included a dispute over the ownership of the licences. Clone claimed that it was entitled to the licences at no cost to it and sought orders protecting, and giving effect to, the proprietary interest it claimed in them.
In addition to Players itself, Clone joined as defendants to the action Players’ principals who had guaranteed Players’ performance of the Lease. Clone also joined Fairtown Holdings Pty Ltd (Fairtown) to enjoin a proposed transfer of the licences from Players to Fairtown, who proposed to operate under them in premises known provisionally as the “Harborsboard”. Finally Clone joined the Liquor Licensing Commissioner (the Commissioner) to ensure the registration of its interest in the licences.
The Commissioner was represented by the Crown Solicitor’s Office (CSO) but did not play an active part in the proceeding. An order was made soon after the proceeding was commenced excusing the Commissioner from serving a list of documents upon his undertaking that he would make his files available to the other parties.
The files held by the Commissioner were;
·     Five files identified with roman numerals (i), (ii), (iii), (iv) and (v), relating to the Planet Hotel liquor licence.[1]
·     Several files pertaining to the Planet Hotel gaming licence.
·     Several files containing applications and associated material relating to the transfer of the Planet Hotel licences to another location referred to as the Harborsboard Building (the Harborsboard files).
·     A file which was entitled “Grenfell Tavern removal file” which contained an application to remove the liquor licence from the Grenfell Tavern and relocate it to the Planet Hotel.
[1]    Volume (i) of the Planet Hotel liquor licence was never located.
Players is now in liquidation. I will refer to it and its principals as the Players Parties. The Players Parties disputed Clone’s claim to the licences and contended that the contractual arrangements between them and Clone conditioned Clone’s right to the licences on the payment by Clone of reasonable consideration.
The trial proceeded before a judge of this Court (the trial judge, the Judge), who generally found in favour of Clone. The important factual finding for the purposes of this application concerned the form of the Agreement when it was executed by the principals of Players. The typed form of the Agreement stipulated that, on termination of the Lease, the licences would be transferred for “Nil consideration”. The original of the Agreement was never produced but several copies produced at the trial showed a faint ink mark over the typed word “NIL”. One of the principals of Players, G, testified that he had struck through the word “NIL” on the original Agreement with his pen before subscribing to it. The legal effect of that pen stroke, and Clone’s subsequent subscription to the Agreement, was said to be that Clone was entitled to the licence only on payment of “consideration” which, by implication, meant the fair market value of the licences.
The trial judge rejected G’s evidence. Consequently, the Judge made orders affecting the transfer of the licences from Players to Clone for no consideration in accordance with the typed form of the Agreement. The orders were, by and large, not disturbed on appeal to the Full Court. It is those orders which Players now seeks to set aside both by a new action and an application brought in the concluded action. Both proceedings are brought in the original, not the appellate, jurisdiction of this Court.
The genesis of this application was the discovery by G, after trial, of additional photocopies of the Agreement which, the Players Parties now contend, show that G’s testimonial account of the form in which the Agreement was executed was true and should have been accepted by the trial judge. First, the Players Parties rely on the recently-discovered copies of the Agreement as new evidence that could not have been discovered with reasonable diligence before trial. They contend that the Court would, or is likely to, have reached a different conclusion if that evidence had been placed before it. Alternatively, the Players Parties contend that other recently-discovered evidence shows that Clone’s legal representatives abused the trial procedures of this Court in order to keep the existence of the additional photocopies of the Agreement secret from the Players Parties and their legal representatives.
The evidence on which the Players Parties rely to prove the procedural misfeasance by Clone’s legal representatives is essentially two-fold. First, G discovered, after the appeal to the Full Court had been determined, that one of the additional photocopies of the Agreement to which I have referred was delivered to this Court during the hearing before the trial judge in response to a Notice to Produce (the Notice). The copy of the Agreement did not come to the attention of the legal representatives of the Players Parties and was never tendered. Clone’s solicitors had served the Notice relating to specified parts of the Commissioner’s file during the course of the hearing before the trial judge. The files were probably delivered to the Court by Clone’s solicitors, who had taken custody of them from the Commissioner’s officers. The files delivered were Volumes ii, iii, iv, and v of the Planet Hotel liquor licence files and the Planet Hotel gaming machine licence files. The Notice was not called on in open court and the legal representatives of the Players Parties did not become aware that a copy of the Agreement was in the gaming machine files, or even that the files had been produced to the Court, until after the finalisation of the appeal.
The second of the additional photocopies of the Agreement was discovered in another of the Commissioner’s files the Grenfell Tavern removal file, which had not been produced to the Court, nor to the Players Parties. A solicitor for the Players Parties had searched the Commissioner’s files at the Commissioner’s offices during the trial but had not discovered the copies of the Agreement to which I have referred probably because the Gaming licence, and Grenfell Tavern removal, files were not produced to him. However Clone’s solicitors knew of the existence of at least one and, probably both, copies of the Agreement whilst the hearing before the trial judge was still continuing.
Clone could not, and does not, make any objection to the use of the recently-discovered copies of the Agreement for the purposes of the application now brought by the Players Parties to set aside the orders of the trial judge. Clone does object to the use of a second body of evidence on which the Players Parties wish to rely which comprises internal communications and file notes (the internal documents) of Clone’s solicitors and counsel relating to the production of the Commissioner’s files to the Court. Those documents were only discovered on an inspection of Clone’s solicitors’ files which had been made available to facilitate the taxation of Clone’s costs (the taxation inspection). The request to inspect the file was made ostensibly for the purposes of that taxation but it appears to have in fact been undertaken for the purpose of discovering evidential material about the circumstances in which the Commissioner’s files were produced to the Court. The taxation inspection also revealed communications between Clone’s solicitors and the Commissioner’s officers but no objection is made by Clone to the use of those documents because the communications are not confidential and can be obtained from the Commissioner in any event.
With respect to the internal documents, Clone contends that the Players Parties are bound by the rule which precludes litigants from using documents obtained by compulsory curial process for extraneous purposes (the rule of preclusion). Clone contends that the rule of preclusion prevents the use of the documents in any proceeding, or in any step in any proceeding, other than the taxation of costs. The Players Parties respond that their proposed use of the internal documents is to set aside orders made in the same proceeding in which the taxation inspection occurred, albeit for a very different step in that proceeding. The Players Parties contend that they are not precluded from using the internal documents in proceedings which are related to the proceeding which was heard by the trial judge. In the alternative, the Players Parties contend that if the rule of preclusion limits their use of the internal documents to the taxation itself, they should be released from that obligation at the discretion of this Court.
Clone also contends that the internal documents evidence communications which are protected by litigation privilege. The Players Parties deny that claim on the ground that the privilege was waived by Clone’s voluntary disclosure of the internal documents in the taxation and by the nature of its pleaded defence. Clone responds that that waiver was limited to the taxation proceedings. In the alternative, the Players Parties contend that there is no privilege over the communications evidenced by the internal documents because the communications were made for the improper purpose of evading Clone’s procedural obligations in the conduct of the trial. Clone denies any misfeasance and that there is any evidence or indication of an improper purpose.
In my view, the production of documents on a taxation of costs pursuant to the rules of this Court waives litigation privilege in those documents only for the limited purpose of the taxation. A successful litigant should not be put to an election between prosecuting his or her statutory entitlement to costs and losing his or her substantive right, as a litigant, to confidentiality over communications related to the litigation. I also find that Clone has not, by its defence, implicated the documents in a way which is inconsistent with maintenance of the privilege.
I find that there is no evidence of improper conduct by Clone’s legal representatives and no prima facie case that the privileged communications were made for an improper purpose.
In my view, an application to set aside final orders by reason of fraud, or on analogous grounds, is an interlocutory application brought in the proceedings in which those orders were made invoking the power of this Court to review, on limited grounds, its final orders. Nonetheless, the purpose of compulsory production of documents on a taxation of costs is completely unrelated to the merits of the resolution of the underlying controversy. For similar reasons to those which support the conclusion that production on a taxation results only in a limited waiver of privilege, I find that the Players Parties are subject to the rule of preclusion. I am also of the view that there are insufficient grounds, in the circumstances of this case, to exempt the Players Parties from the rule of preclusion.

I elaborate my reasons below.
Power to Set Aside Perfected Orders
It is necessary to understand something of the nature of the proceedings brought by the Players Parties to set aside the orders of the trial judge before their contentions that they are not, or should not be, precluded from using the internal documents, can be evaluated. For reasons which appear below, in my view nothing turns on whether the application to set aside the trial judge’s orders is made in the initial action or in a new action brought before this Court.
I will first consider the nature of the proceedings to set aside the orders made by the trial judge for the purpose of determining whether they are the “same” proceedings as the taxation proceedings for the purposes of the rule of preclusion and if so, whether they are nonetheless subject to the rule. I will then consider the evidential significance of the internal documents in the context of the points of claim and defence on the application made by the Players Parties. I will do so, first, to determine whether Clone has waived its privilege by its defence, and secondly, to determine whether the internal documents record communications made, arguably, to effect an unlawful purpose. Finally it will be necessary to consider whether, if privilege is lost on either, or both, of those grounds, or because of the production of the documents on the taxation, the evidential significance of the internal documents warrants excusing the Players Parties from compliance with the rule of preclusion.
Final decrees in Chancery could be set aside before and after entry into the Rolls of the Court. Before the decree was enrolled, the review of the decree could be initiated by a “Supplemental Bill” and the review was in the nature of a rehearing. Any new evidence on which such an application for review might be based had to be evidence which could not have been found by the time of trial with the exercise of reasonable diligence[2] and which was so material that it would probably have changed the result.[3]
[2] Norris v Le Neve (1743) 3 Atk 26; 26 ER 818.
[3] Hungate v Gascoyne (1846) 2 Ph 25; 41 ER 850.
The superior common law courts took a much more rigid position which entrenched the finality of their orders. The superior common law courts exercised the power to order a new trial only before judgments, founded on a jury verdict, were entered into their records. The record of the Court was not finalised, and was in the “breast of the court”, during the term in which it was given and could therefore be corrected in that term.[4] That power appears to have its origins in the concern of the Courts of Common Pleas and King’s Bench, after they had settled in Westminster,[5] to supervise proceedings held before justices on commission in other parts of the country.[6] The judges on circuit (nisi prius) acted as, and for, the Court in Westminster.[7] They would transmit a record of the proceedings, a postea, to the Court in Westminster. The entry of judgment on that record was, by practice, delayed until the fourth day of the following term.[8] By the 17^th century, the court of King’s Bench, in banc, would entertain a motion made in those four days to stay the entry of judgment and order a new trial.[9]
[4]    R v Nam [1968] SASR 107 at 108.
[5]    W.S. Holdsworth, A History of English Law, (Methuen & Co. Ltd, Volume 1, 7^th ed, 1956) 206.
[6]    Justices of assize were judges of the common law courts, or sergeants who were authorised by commission to hear the trials of actions commenced in the common law courts on circuit. Criminal matters were heard on circuit in accordance with a jurisdiction conferred by various commissions. The sittings were designated nisi prius because trials would be listed in Westminster unless heard beforehand, nisi prius, on circuit. W.S. Holdsworth, A History of English Law (Methuen & Co. Ltd, Volume 1, 7^th ed, 1956) 281.
[7]    W.S. Holdsworth, A History of English Law (Methuen & Co. Ltd, Volume 1, 7^th ed, 1956) 281.
[8]    W.S. Holdsworth, A History of English Law (Methuen & Co. Ltd, Volume 1, 7^th ed, 1956) 281 – 282.
[9]    Musgrove v McDonald (1905) 3 CLR 132 at 147 - 148 citing Lord Blackburn in South-Eastern Railway Co. v. Smitherman 47 J.P., 773. The practice of the Court of Common Pleas of granting new trials can be traced back even earlier to the fourteenth century: W.S. Holdsworth, A History of English Law (Methuen & Co. Ltd, Volume 1, 7^th ed, 1956) 225.
By the 18^th century it was also accepted that the King’s Bench could grant a new trial in an action heard at Westminster before judgment was entered. In Bright v Eynon,[10] Lord Mansfield recognised the necessity of the power for both trials in banc and nisi prius because of the ineffectiveness of the jury attaint procedure[11] and the delay and expense of seeking a remedy in Chancery. A new trial would be granted if “the justice of the case demands it”. Lord Mansfield mentioned fraud, covin,[12] excessive damages, and verdicts against the weight of the evidence as grounds for the exercise of the discretion to order a new trial.[13] Lord Mansfield also referred to cases where the “parties may be surprized, by a case falsely made at the trial, which they had no reason to expect, and therefore could not come prepared to answer.”
[10] Bright v Eynon (1757) 1 Burr 390; 97 ER 365.
[11] The unsuccessful party to a common law action could charge the jury which brought in the adverse verdict with returning a false verdict, but that harsh procedure fell into disuse and was abolished in 1825. D.M. Gordon QC, ‘Fraud or New Evidence as Grounds for Actions to Set Aside Judgments – I’ (1961) 77 LQR 358 at 362.
[12] Collusive action between parties to proceedings to defraud another.
[13] Monroe Schneider Associates (Inc) v No 1 Raberem Pty Ltd [No 2] (1992) 109 ALR 137 at 147; see also D.M. Gordon QC, ‘Fraud or New Evidence as Grounds for Actions to Set Aside Judgments – I’ (1961) 77 LQR 358 at 362 and W.S. Holdsworth, A History of English Law (Methuen & Co. Ltd, Volume 1, 7^th ed, 1956) 340 – 344.
The discovery of fresh evidence was also a ground on which a new trial might be ordered but the common law courts adopted a stricter approach to this ground than Chancery.[14] In Orr v Holmes,[15] Dixon J, as he then was, summarised the not always uniform articulations of the test for the reception of fresh evidence on an application brought on common law grounds for a new trial in this way:
No doubt some of the foregoing expressions are susceptible of a weaker application than others of them. But the evident purpose of all of them is to ensure that new trials will not be granted because of fresh evidence unless it places such a different complexion upon the case that a reversal of the former result ought certainly to ensue. The fact which the new evidence tends to prove, if it does not itself form part of the issue, must be well nigh decisive of the state of facts upon which the issue depends. The evidence must be so persuasive of the existence of the fact it tends to prove that a finding to the contrary, if it had been given, would, upon the materials before the court, appear to have been improbable if not unreasonable.
[14] WollongongCorporation v Cowan (1955) 93 CLR 435.
[15] Orr v Holmes (1948) 76 CLR 632 at 642.
In Wollongong Corporation v Cowan[16] Dixon CJ said:
If cases are put aside where a trial has miscarried through misdirection, misreception of evidence, wrongful rejection of evidence or other error and if cases of surprise, malpractice or fraud are put on one side, it is essential to give effect to the rule that the verdict, regularly obtained, must not be disturbed without some insistent demand of justice. The discovery of fresh evidence in such circumstances could rarely, if ever, be a ground for a new trial unless certain well-known conditions are fulfilled. It must be reasonably clear that if the evidence had been available at the first trial and had been adduced, an opposite result would have been produced or, if it is not reasonably clear that it would have been produced, it must have been so highly likely as to make it unreasonable to suppose the contrary. Again, reasonable diligence must have been exercised to procure the evidence which the defeated party failed to adduce at the first trial
[16] Wollongong Corporation v Cowan (1955) 93 CLR 435 at 444.
In CDJ v VAJ[17] McHugh, Gummow and Callinan JJ explained why the last cited passage should not be understood as stating a universal test for the admission of further evidence on appeal.[18] Rather the statements in Orr and Wollongong Corporation are to be understood to refer to the common law procedure on a motion for a new trial.[19] I observe that in the passage cited from Wollongong Corporation, surprise and malpractice are associated with fraud as an exception to the strict approach taken to the probative weight required where the ground is new evidence simpliciter. In this context, it appears that surprise means evidence given against a party at trial which that party could not reasonably have anticipated.[20]
[17] CDJ v VAJ (1998) 197 CLR 172 at 199.
[18] CDJ v VAJ (1998) 197 CLR 172 at 199.
[19] CDJ v VAJ (1998) 197 CLR 172 at 198.
[20] Isaacs v Hobhouse [1919] 1 KB 398; Jeffrey v Jeffrey (1931) 31 SR (NSW) 535; Thomas v The Crown (1904) 2 CLR 127; National Pictures Ltd v Gibbs, Bright & Co [1925] SASR 358.
Common law courts also enjoyed wide powers of review of decisions not based on verdicts before the judgment was perfected but the origin, nature and procedural incidents of that power differed markedly from the review of decrees in Chancery. A wide discretion to reconsider decisions before a judgment is perfected remains in the practice and procedures of this Court to this day.[21] In Smith v New South Wales Bar Association,[22] Brennan, Dawson, Toohey and Gaudron JJ referred to the established rule of the common law that a court may “review, correct or alter” its judgments before they have been perfected. At the very least, superior courts of law and equity have always enjoyed wide powers of review in the period preceding enrolment of the judgment or decree.[23] The High Court in Smith confirmed the discretionary nature of the power and that it was to be exercised having regard to the public interest in maintaining the finality of litigation. A distinction was drawn between the considerations relevant to the discretion to reopen a judgment and the nature of the review if permission to reopen is given. The High Court held that the nature and extent of the review “must depend on the error or omission which has led to that step being taken.”[24]
[21] Supreme Court Civil Rules 2006, r 242; Harrison v Schipp (2002) 54 NSWLR 612 at 617.
[22] Smith v New South Wales Bar Association (1992) 176 CLR 256 at 265.
[23] The Texas Company (Australasia) Ltd v Federal Commissioner of Taxation (1940) 63 CLR 382 at 457.
[24] Smith v New South Wales Bar Association (1992) 176 CLR 256 at 265. See also DJL v The Central Authority (2000) 201 CLR 226 at 244 - 245 (Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ). It has also been held that an appellate court may vacate its orders before they are perfected if a party was denied procedural fairness. Autodesk Inc. v Dyason [No 2] (1993) 176 CLR 300 at 302; Smith v New South Wales Bar Association (1992) 176 CLR 256 at 264 - 266. The power may be exercisable on wider grounds in the interests of justice. See Autodesk Inc. v Dyason [No 2] (1993) 176 CLR 300 at 302, 322.
After the decree was enrolled, the powers of the Court of Chancery and the superior common law courts diverged markedly. The grounds of review of an enrolled decree in Chancery were patent error of law, fraud or the discovery of new evidence. An application to set aside a decree on the finding of patent error, or on the grounds of new evidence, was initiated by a Bill of Review, which, on the latter ground, required leave.[25] A Bill of Review could be brought on the ground of new evidence even after the enrolled decree had been affirmed on appeal.[26] Moreover, the possibility of a further review to restore the original decree on the grounds of yet further new evidence appears to have been accepted.[27] The relatively extensive review available in Chancery is perhaps explicable by the nature of the jurisdiction it exercised, its procedures for the taking of evidence, and the constitution of the Court.[28]
[25] Harrison v Schipp (2002) 54 NSWLR 612 at 617.
[26] Harrison v Schipp (2002) 54 NSWLR 612 at 617. D.M. Gordon QC, ‘Fraud or New Evidence as Grounds for Actions to Set Aside Judgments – I’ (1961) 77 LQR 358 at 367. Hosking v Terry (1862) 15 Moo PC 493; 15 ER 581.
[27] D.M. Gordon QC, ‘Fraud or New Evidence as Grounds for Actions to Set Aside Judgments – I’ (1961) 77 LQR 358 at 367.
[28] See T. Plucknett A Concise History of the Common Law (Butterworth, 5^th ed, 1956) 209 – 210. W.S. Holdsworth, A History of English Law, (Methuen & Co. Ltd, Volume 1, 7^th ed, 1956) 368, 405 – 407, 416 – 420, 427 – 428, 442 – 493.
In the case of fraud, a decree in Chancery could be impeached by an Original Bill brought without leave.[29]
[29] Harrison v Schipp (2002) 54 NSWLR 612 at 618. See also D.M. Gordon QC, ‘Fraud or New Evidence as Grounds for Actions to Set Aside Judgments – I’ (1961) 77 LQR 358 at 366 – 367. From 1860 until the Judicature Acts, permission to allow a rehearing was required for both fraud and the discovery of fresh evidence.
Equity also intervened to set aside enrolled decrees in cases falling short of fraud which were described as surprise. The most certain meaning of that term in Chancery proceedings is one which is now obsolete.[30] Where a decree had been enrolled more quickly than the unsuccessful party might have expected, and before he or she had had an opportunity to seek a review on the merits by filing a Supplemental Bill, the unsuccessful party might have the enrolment “undone” on the ground of surprise. Later, it became a necessary condition for such relief that the successful party had represented that the decree would not be enrolled without notice.[31]
[30] Monroe Schneider Associates (Inc) v No 1 Raberem Pty Ltd [No 2] (1992) 109 ALR 137 at 144. See also L.A. Sheridan, ‘Fraud and Surprise in Legal Proceedings’ (1955) 18 MLR 441.
[31] L.A. Sheridan, ‘Fraud and Surprise in Legal Proceedings’ (1955) 18 MLR 441 at 448.
It may be that the concept of surprise, at least in more recent times, includes the failure to discover directly relevant documents. The issue came before the Privy Council in Hip Foong Hong v H. Neotia & Co[32] on an appeal from a refusal of the Full Court of His Britannic Majesty’s Supreme Court for China to order a new trial in an action arising out of contracts for the trade in opium between China and India. The respondent had obtained judgment in its favour on the ground that the contracts had been terminated before the date of the contractual breaches on which the appellants had sued. The judgment was perfected. The appellants then brought an application for a new trial on the ground that the appellants had subsequently found business documents of the respondent which showed that the respondent had continued to treat the contracts, in its own records, as extant at the relevant time. The appellants had also found telegrams showing an attempt by the respondent to procure the giving of false evidence at the trial.
[32] Hip Foong Hong v H. Neotia & Co [1918] 1 AC 888 at 893 – 894.
The Privy Council was, perhaps surprisingly, not satisfied that fraud was proved,[33] but appears to have accepted that the case was one of surprise.[34] The Privy Council proceeded on the basis that in the case of both fraud and surprise it was not necessary to show that the newly-discovered evidence was apparently credible and conclusive. The Privy Council also held that a judgment tainted by fraud is vitiated and that no more need be shown to have it set aside. However, other than to emphasise that a new trial will only be ordered where there has been a miscarriage of justice, the Privy Council did not further elucidate what must be shown in the case of surprise.[35] I pause here to observe that the action in Hip Foong Hong was a common law action. It is not clear whether the Privy Council was proceeding on the basis that after the Supreme Court of Judicature Act 1873 (UK) and the Supreme Court of Judicature Act 1875 (UK),[36] a perfected common law judgment could be set aside on grounds which would found a review in Chancery or on the basis that, because surprise had been a ground on which a new trial in the common law courts could be granted before judgment, it had become, after the Judicature Acts, also a ground on which a perfected common law judgment could be set aside.[37]
[33] Hip Foong Hong v H. Neotia & Co [1918] 1 AC 888 at 893 – 894.
[34] Hip Foong Hong v H. Neotia & Co [1918] 1 AC 888 at 894.
[35] Hip Foong Hong v H. Neotia & Co [1918] 1 AC 888 at 894.
[36] I will refer to both Acts jointly as the Judicature Acts and the Acts.
[37] The particular statutory powers of the Supreme Court of China are not set out in the report.
The common law knew of no appeal or rehearing from an enrolled judgment founded on a verdict.[38] The powers of the common law courts to review enrolled judgments were limited to their correction, by writ brought in the King’s Bench, for error of law on the face of the record,[39] and to the correction of clerical error in the entry of judgments into the records of the Court.[40] Various statutory and informal arrangements for hearing appeals on questions of law decided by the superior common law courts were established over time. The superior common law courts were powerless to correct enrolled judgments on any other ground, including fraud. References in the older authorities to fraud vitiating common law judgments are in the main references to the liberty of third parties to collaterally attack “collusive” judgments. A collusive judgment is one entered by a fraudulent arrangement made between the parties to it in order to defeat the rights of a third party. Judgments on fictitious debts to defeat the consequences of insolvency and matrimonial and property judgments are examples. It may be doubted that these cases are authority for the setting aside of a judgment as between the parties to it on the ground of fraud.[41]
[38] D.M. Gordon QC, ‘Fraud or New Evidence as Grounds for Actions to Set Aside Judgments – I’ (1961) 77 LQR 358.
[39] W.S. Holdsworth A History of English Law, (Methuen & Co. Ltd, Volume 1, 7^th ed, 1956) 213 – 215; T. Plucknett A Concise History of the Common Law (Butterworth, 5^th ed, 1956) 210; D.M. Gordon QC, ‘Fraud or New Evidence as Grounds for Actions to Set Aside Judgments – I’ (1961) 77 LQR 358.
[40] W.S. Holdsworth, A History of English Law, (Methuen & Co. Ltd, Volume 1, 7^th ed, 1956) 224.
[41] D.M. Gordon QC, ‘Fraud or New Evidence as Grounds for Actions to Set Aside Judgments – I’ (1961) 77 LQR 358 at 362.
The common law courts had faced two practical difficulties in setting aside judgments, not yet perfected, for fraud. The first was the inscrutable nature of the jury verdict. The second was the absence of a written record of the evidence. In motions for a new trial on the ground of fraud before the judgment was enrolled, these difficulties were overcome by presuming that a fraudulent arrangement influenced the course of the trial and the verdict.[42]
[42] D.M. Gordon QC, ‘Fraud or New Evidence as Grounds for Actions to Set Aside Judgments – I’ (1961) 77 LQR 358 at 368.
The refusal of the common law courts to impeach a judgment after it had been entered into the records of the court was ameliorated, at least in part, by Chancery. Chancery would enjoin a fraudulent common law judgment holder from enforcing the judgment and oblige the judgment holder to enter satisfaction of it upon the judgment roll of the common law court.[43] Before the Judicature Acts, equity intervened by these indirect methods in the case of both fraud and newly-discovered evidence.[44]
[43] D.M. Gordon QC, ‘Fraud or New Evidence as Grounds for Actions to Set Aside Judgments – I’ (1961) 77 LQR 358 at 368; Monroe Schneider Associates (Inc) v No 1 Raberem Pty Ltd[No 2] (1992) 109 ALR 137 at 142.
[44] D.M. Gordon QC, ‘Fraud or New Evidence as Grounds for Actions to Set Aside Judgments – I’ (1961) 77 LQR 358 at 368.

The jurisdiction invoked by an original action to impeach an earlier judgment for fraud has been described as “equitable in origin and nature”.[45] In my respectful opinion, that description is apt for an action in Chancery to restrain a fraudulent common law judgment holder from enjoying the fruits of his or her judgment. It was a general head of equitable jurisdiction to intervene and provide a remedy where the common law’s capacity to do so was inadequate.[46] On the other hand, the power of the superior common law courts to set aside verdicts, and of Chancery to set aside its judgments before and after enrolment, are more aptly viewed as ancillary powers, rather than as an independent head of jurisdiction.[47] That is most obviously so in the case of the common law procedure on a motion for a new trial. The multiplicity of rehearings available in Chancery can also be viewed, notwithstanding the various forms of the initiating Bills, as the adoption of procedures by that Court which were calculated to ensure that justice was ultimately done in the original proceedings.[48]
[45] Wentworth v Rogers [No 5] (1986) 6 NSWLR 534 at 538; Monroe Schneider Associates (Inc) v No 1 Raberem Pty Ltd [No 2] (1992) 109 ALR 137 at 141.
[46] Monroe Schneider Associates (Inc) v No 1 Raberem Pty Ltd [No 2] (1992) 109 ALR 137 at 142.
[47] Harrison v Schipp (2002) 54 NSWLR 612 at [189] and [191].
[48] W.S. Holdsworth, A History of English Law, (Methuen & Co. Ltd, Volume 1, 7^th ed, 1956) 369.
The Judicature Acts replaced the several superior courts of England with a single superior court, the High Court, to administer both law and equity but did not expressly address the question of the power of the High Court to set aside its judgments. The conferral of jurisdiction on the High Court was in terms which suggested that it could exercise the incidental powers formerly exercised by the superior courts which it had replaced.[49]
[49] Judicature Act 1873 (UK) s 16.
The Rules of the High Court scheduled to the Judicature Acts made no provision for reviewing or setting aside judgments. Actions were generally initiated by writ and summons. Trials were to be by jury but a summary judgment procedure was available.
The Judicature Acts also constituted a Court of Appeal to hear appeals from any judgment or order of the High Court and conferred on it the appellate jurisdiction of the Lord Chancellor and the Court of Appeal in Chancery. The Judicature Acts provided, by way of Rules of Court scheduled to the Acts, that an appeal to the Court of Appeal was by way of a rehearing with a power “to receive further evidence.”[50] The time within which to appeal was fixed at one year. The Judicature Acts expressly conferred on the Court of Appeal the powers of “amendment, execution, and enforcement of any judgment or order” exercisable by the High Court within its jurisdictions.[51]
[50] In Eastman v The Queen (2000) 203 CLR 1 at [184]-[187], Gummow J referred to these and observed that by so providing it was accepted that the right of appeal granted by the Judicature Acts was an appeal by way of rehearing which enabled the receipt of further evidence.
[51] Judicature Act 1873 (UK).
The Judicature Acts also provided for motions for new trials to be heard before a Divisional Court. The motion for a new trial before the Divisional Court was the equivalent of the motion for a new trial previously brought in the common law courts sitting in banc but was on its face applicable to both decrees and judgments. An appeal lay to the Court of Appeal only if such a motion had been brought and lost.
Judicial dicta on the continued existence of a power to set aside judgments after the Judicature Acts reforms differed and changed over time.[52] In particular, in Flower v Lloyd (No 1),[53] the Court of Appeal held that it had no power to reopen an appeal heard by it on the grounds of the recently discovered fraudulent conduct of a party at trial in the High Court, but that such an action could be brought before a single judge of the High Court, perhaps even on the grounds of new evidence alone. The appellant acted on that suggestion and brought an original action in the High Court which found fraud and set aside its earlier judgment. In Flower v Lloyd (No 2),[54] the appeal against the finding of fraud and judgment given in the second action was successful on the facts, but James LJ expressed considerable doubts about the availability of the action at all.[55]
[52] See discussion in Harrison v Schipp (2002) 54 NSWLR 612 at 618 – 624 (Handley JA), 634 – 637 (Giles JA), 651 – 657 (Ipp A-JA). See also Falcke v Scottish Imperial Insurance Company (1886) 34 Ch D 234; Flower v Lloyd (No 1) (1877) 6 Ch D 297; Flower v Lloyd (No 2) (1879) 10 Ch D 327; Boswell v Coaks (No 2) (1894) 86 LT 365; Re St. Nazaire Co (1879) 12 Ch D 88; Re Suffield and Watts; Ex parte Brown (1888) 20 QBD 693; Preston Banking Company v William Allsup & Sons [1895] 1 Ch 141; Re May (1883) 25 Ch D 231; Re May (1885) 28 Ch D 516; Re Scott and Alvarez’s Contract [1895] 1 Ch 596; Charles Bright & Co Ltd v Sellar [1904] 1 KB 6.
[53] Flower v Lloyd(No 1) (1877) 6 Ch D 297.
[54] Flower v Lloyd (No 2) (1879) 10 Ch D 327.
[55] Flower v Lloyd (No 2) (1879) 10 Ch D 327.
In Re St. Nazaire Co,[56] the Court of Appeal held that a single judge of the High Court did not have power to set aside an enrolled decree on the grounds of new evidence alone. The Court held that the statutory right of appeal to the Court of Appeal, and the express conferral on the Court of Appeal of the appellate jurisdiction of Chancery denied, by implication, the High Court the power, formerly exercised in Chancery, to set aside an enrolled judgment on the ground of subsequently-discovered evidence. Jessel MR expressed great surprise that “any one should have thought for a moment that a rehearing of this kind, involving a discharge … of an order of the Appeal Court, could be presented to a Judge of the Court of first instance.” The order of the Appeal Court to which Jessel MR referred was an order dismissing an appeal from the trial judge. It is not as obvious to me, with respect, why an order dismissing an appeal effectively incorporates the orders of the trial court as orders of the appeal court. But in any event, that observation was not an essential step in the reasoning of the Master of the Rolls. Thesiger LJ emphasised the importance of maintaining consistency between the powers to deal with judgments in the Common Law Division and in the Chancery Division of the High Court. That observation would appear to be premised on an implicit rejection of the possibility that the Judicature Acts had conferred on the High Court the same power over all of its perfected judgments that Chancery had once exercised over its enrolled decrees but again, in my respectful view, that was not a necessary step in reaching the Court’s conclusion.
[56] Re St. Nazaire Co (1879) 12 Ch D 88. In DJL v The Central Authority (2000) 201 CLR 226 at 244, Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ approved the decision in Re St. Nazaire Co and expressly accepted that the right of rehearing in the Court of Chancery had involved the exercise of appellate rather than original jurisdiction.
The decision in Re St. Nazaire Co was affirmed in Re Suffield and Watts; Ex parte Brown[57] and Preston Banking Company v William Allsup & Sons.[58]However, the power to set aside a judgment, even after an order had been enrolled on the ground of subsequently discovered evidence, was assumed in Re May,[59] a case in which in Re St. Nazaire Co was not cited. Kay J also thought that the power still existed in Falcke v Scottish Imperial Insurance Company.[60] In Re Scott and Alvarez’s Contract,[61] a purchaser was allowed by Kekewich J to defend an action for specific performance brought by a vendor who had succeeded in the Court of Appeal in obtaining a declaration that he had good title in accordance with the contract. The purchaser defended the claim for specific performance by counterclaiming for review of the Court of Appeal’s declaration on the ground of fresh evidence. Counsel for the vendor did not dispute the power of the High Court to make the order on the basis claimed.
[57] Re Suffield and Watts; Ex parte Brown (1888) 20 QBD 693.
[58] Preston Banking Company v William Allsup & Sons [1895] 1 Ch 141 at 143.
[59] Re May (1883) 25 Ch D 231.
[60] Falcke v Scottish Imperial Insurance Company (1886) 34 Ch D 234.
[61] Re Scott and Alvarez’s Contract [1895] 1 Ch 596.
In Charles Bright & Co Ltd v Sellar,[62] a review was brought for error of law apparent on the face of an order of the High Court which had not yet been enrolled. The trial judge held that an original action to set aside the judgment did not lie. On appeal, Cozens-Hardy LJ cited Re St. Nazaire Co as authority for the proposition that a judge of the High Court had no jurisdiction to rehear the case on such an application. Cozens-Hardy LJ held that the only remedy was by way of appeal to the Court of Appeal. Cozens-Hardy LJ went further and observed;
Doubtless there is ample jurisdiction now to deal by fresh action with some matters which were formerly the subject of a bill of review, or of a supplemental bill in the nature of a bill of review. For instance, where a judgment has been obtained by fraud, Birch v. Birch, or where fresh material evidence has been obtained since the judgment which could not have been previously procured, Boswell v. Coaks, an action may be maintained. Actions of this nature do not invite the High Court to rehear upon the old materials. Fresh facts are brought forward, and the litigation may be well regarded as new and not appellate in its nature, because not involving any decision contrary to the previous decision of the High Court.
(Footnotes omitted)
[62] Charles Bright & Co Ltd v Sellar [1904] 1 KB 6.
Cozens-Hardy LJ cited in support of his observations the decision of Kay J in Falcke v Scottish Imperial Insurance Company.[63]Unfortunately the significant difference in the scope of review before and after judgments have been enrolled appears to have been overlooked. As Handley JA explained in Harrison v Schipp,[64] Re St. Nazaire had dealt with an order which had been enrolled; the appeal provisions of the Judicature Acts could not have altered or derogated from the power to review decisions before they were enrolled because that power is not appellate.[65] Accordingly, the trial judge in Charles Bright & Co Ltd[66] did have power to correct and vary his judgment if the interest of justice so required, and the decision in that case takes an unduly narrow view of the power to vary judgments before they are enrolled.
[63] Falcke v Scottish Imperial Insurance Company (1887) 57 LT 39.
[64] Harrison v Schipp (2002) 54 NSWLR 612 at 624.
[65] Harrison v Schipp (2002) 54 NSWLR 612 at 624.
[66] Charles Bright & Co Ltd v Sellar [1904] 1 KB 6
Finality, which is an essential attribute of judicial power, requires the identification of a clear end point for the judicial process and for historical and practical reasons enrolment serves that purpose. The power to correct any form of error in a judgment before it is enrolled, or otherwise finally recorded, remained unaffected by the provision of a general right of appeal. Thereafter, the provision of a general right of appeal to correct both errors of fact or law with a supplemental power to receive further evidence would appear to be inconsistent with the powers of review of enrolled decrees formerly exercisable in Chancery. For that reason, the dicta of Cozens-Hardy LJ concerning fresh evidence are mistakenly wide if applied to enrolled judgments. I respectfully adopt the criticisms made of the dicta of Cozens- Hardy LJ by Handley JA in Harrison.[67]
[67] Harrison v Schipp (2002) 54 NSWLR 612 at [52] – [54].
The redress of fraud stands differently. In Boswell v Coaks (No 2),[68] it was unequivocally accepted, notwithstanding the doubts expressed by Thesiger LJ in Flower v Lloyd (No 2), that proceedings could be brought in the High Court to set aside a judgment for fraud. Some parts of the speech of Lord Selborne appear to tacitly accept that a review might also be entertained on the ground of new evidence, even without fraud;[69] however it is more likely that Lord Selborne was discussing the post-Judicature Acts procedure for setting aside a judgment on the grounds of fraud by reference to the pre-Judicature Acts procedures for setting aside judgments on that and other grounds.[70]
[68] Boswell v Coaks (No 2) (1894) 86 LT 365.
[69] Boswell v Coaks (No 2) (1894) 86 LT 365 at 366.
[70] Harrison v Schipp (2002) 54 NSWLR 612 at 623 (Handley JA), at 635 (Giles JA), at 655 (Ipp A-JA).
In Re Barrell Enterprises,[71] the Court of Appeal removed any remaining doubt about the position in England and held that an action would not lie to set aside a judgment on the ground of fresh evidence. The judgment of Jessel MR in Re St. Nazaire Co was followed.
[71] Re Barrell Enterprises [1973] 1 WLR 19.
It remains to be observed that perfected common law judgments were often impugned by action for review on the ground of fraud in England after the passing of the Judicature Acts.[72] These actions can only have proceeded on the premise rejected by Thesiger LJ in Flower v Lloyd (No 2),[73] that the powers formerly exercised by Chancery were available to the High Court with respect to common law judgments. D.M. Gordon has suggested that a theoretical basis for the exercise by the High Court of powers like Chancery’s over common law judgments might be found in the former Chancery jurisdiction to restrain those judgments. He suggests that an application to set aside a judgment of the High Court might be seen as the pre-emptive raising of an equitable defence to the enforcement of the common law judgment.[74] However the judgments suggest that the power was seen as a post-Judicature Acts extension of the power to disregard collusive judgments. In my respectful opinion, it is at least a simpler solution to hold that the Judicature Acts conferred on the High Court, by necessary implication from its very creation as a single court of law and equity, the combined powers of the courts which it replaced.
[72] D.M. Gordon QC, ‘Fraud or New Evidence as Grounds for Actions to Set Aside Judgments – I’ (1961) 77 LQR 358 at 369 – 370.
[73] Flower v Lloyd (No 2) (1879) 10 Ch D 327.
[74] D.M. Gordon QC, ‘Fraud or New Evidence as Grounds for Actions to Set Aside Judgments – I’ (1961) 77 LQR 358 at 369 – 370.
Finally, I observe that in Venkata Narasimha Appa Row v Court of Wards,[75] the Privy Council accepted that it was empowered to review a judgment on the ground of fraud after its advice had been effected by an order in Council.
[75] Venkata Narasimha Appa Row v Court of Wards (1886) 11 App Cas 660.
Jurisdiction and Powers of the Supreme Court of South Australia
In South Australia, a consideration of the nature of the power of this Court to set aside its judgments must proceed from the provisions of the Supreme Court Act 1935 understood in their historical context.
The Supreme Court Act 1855-6 consolidated the pre-existing ordinances which had established the Supreme Court of South Australia. The Supreme Court was constituted a “Court of Record” and given the jurisdictions of the superior common law courts of England.[76] The Court was also constituted a “Court of Equity” on which was conferred the equitable jurisdiction and associated powers of “the Lord High Chancellor of Great Britain”.[77] The Supreme Court Act 1855-6 made express reference to the two existing Justices of the Court, Cooper CJ and Boothby J, and provided that the jurisdiction of the Court was to be exercised by one or both of them. A third judicial office was created by The Third Judge and District Courts Act 1858.[78]
[76] Supreme Court Act 1855-6 s 7.
[77] Supreme Court Act 1855-6 s 8.
[78] The third judge was Gwynne J appointed on 26 February 1859. The Third Judge and District Courts Act 1858 was further amended in 1867 by Act No 11 of 1866-7. The Fourth Judge Act 1919 provided for the appointment of a fourth judge to the Court.
Section 18 of the Supreme Court Act 1855-6 created a Court of Appeals comprising the Governor and the members of Executive Council other than the Attorney-General and the Crown Solicitor.[79]
[79] Only civil judgments for a sum greater than £100 could be appealed to the Court of Appeals (Supreme Court Act 1855-6 s 18). An appeal to the Privy Council lay from judgments in the sum of more than £500. Appeals could also be brought from the Court of Appeals to the Privy Council by leave. Appeals were to be instituted within 14 days. (Supreme Court Act 1855-6 s 19.) The conduct of appeals to the Court of Appeals was further regulated by Act No 5 of 1861. Section 1 of the Supreme Court Act Amendment Act 1865 increased the jurisdiction of the Court of Appeals to all matters irrespective of the amount of the judgment. Appeals were to be brought within 3 months of the judgment or decree. (The Court of Appeals Amendment Act 1865 s 2). The legislative provisions creating the Court of Appeals were not repealed until the enactment of the Supreme Court Act 1935 but the Court ceased to function well before its formal abolition.
The Equity Act 1866 (the Equity Act) consolidated and reformed the procedure in the equitable jurisdiction of the Court. It conferred on the Supreme Court the like equitable jurisdiction of the Lord High Chancellor of Great Britain and the High Court of Chancery. Section 9 of the Equity Act created the office of Primary Judge. The Primary Judge could hear equitable causes and matters without the assistance of the other judges.[80] An appeal lay pursuant to s 11 of the Equity Act from a decree or order of the Primary Judge to the Full Court within 14 days after it was made, or within such further time as may be allowed by a judge of the Court in accordance with the Rules and Regulations in the First Schedule to the Equity Act. Section 11 of the Equity Act was permissive and did not derogate from the right of appeal to the Privy Council from the Primary Judge’s decision which, by virtue of s 9 of the Equity Act, was deemed “as valid, effectual, and binding” as a decree pronounced by the Full Court.[81]
[80] The Equity Act 1866 s 9.
[81] Giles v Wooldridge (1879) 13 SALR 185.
Section 153 of the Equity Act provided that unless the Act or rules made under it prescribed otherwise, the practice and procedure of the Court in its equity jurisdiction shall, where the same is applicable, be according to the course and procedure of the High Court of Chancery.[82]
[82] The Equity Act 1866 s 153.
Rules scheduled to the Equity Act appear to assume that the Full Court would exercise a jurisdiction analogous to that exercised by the Lord Chancellor. In particular they provided that, unless specific provision had otherwise been made, the rules and practice for rehearings before the Lord Chancellor of causes or matters decided by the Master of the Rolls or the Vice Chancellors would apply to appeals from the Primary Judge. No specific provision was made for the initiation of reviews before the Primary Judge by way of an Original Petition or Bill of Review. Arguably the appeal from the Primary Judge to the Full Court impliedly denied the Primary Judge the powers of review over his own decrees which were exercisable by the Lord Chancellor notwithstanding the terms of s 153 of the Equity Act.
The Supreme Court Act 1867 (the 1867 Act) conferred further powers on the Supreme Court. It allowed the Court to conduct its business and make orders on any day whether within a term or not.[83] Section 31 of the 1867 Act provided that the judges of the Court could sit in several jurisdictions at the one time.
It provided that such orders “shall be of the like validity, force, and effect, as if the day upon which the same shall or may be so made, …, was actually a day in term time, and not in vacation, and the day or one of the days in term time required by any such law, practice, or usage as aforesaid”.

The Supreme Court Act 1878 (the 1878 Act) consolidated and amended the earlier Supreme Court Acts. It provided for the concurrent administration of law and equity by the Supreme Court.[84] The 1878 Act provided that no cause or proceeding in the Supreme Court could be restrained by prohibition or injunction but every matter of equity which might have founded such relief could be relied on by way of defence. Section 7 of the 1878 Act abolished the division of the legal year into terms “in so far as relates to the administration of justice”. The division of the “sitting and business of the Court” into terms was abolished.[85]
[84] Supreme Court Act 1878 s 5.
[85] However s 7 of the 1878 Act went on to provide that “in all other cases in which under the law now existing, the terms into which the legal year is divided are used as a measure for determining the time at or within which any act is required to be done, the same may continue to be referred to for the same or the like purpose, unless and until provision is otherwise made by any lawful authority”.
Section 15 of the 1878 Act provided that motions to vary or set aside verdicts “found by a jury or by a Judge, without a jury” were to be dealt with by the Full Court.[86] Motions to arrest judgment, or to enter a judgment against the verdict, or to reduce damages were to be brought as motions for a new trial. “Full Court” was defined to mean all three judges unless one or more of them were unable to sit.
[86] The grounds upon which a new trial might have been ordered included a verdict given against the evidence in the sense that “reasonable men ought not have [so] found”; Solomon v Bitton (1881) 8 QBD 176; Metropolitan Railway Co v Wright (1886) 11 App Cas 152; Burns v National Insurance Co of Australasia (1884) 18 SALR 50.
Section 15 of the 1878 Act further provided that no appeal lay from any judgment founded upon a verdict unless a motion had been taken to set aside or reverse the verdict.[87] The 1878 Act defined judgments to include decrees.
[87] Verdict meant any finding of fact whether made by a judge or a jury. Appeals were prohibited unless such a motion was brought to the Court of Appeals and the Privy Council. See Angas v Cowan (1883) 17 SALR 110.
It appears to me that in the case of a judgment based on a verdict, the conferral of an exclusive power on the Full Court by s 15 of the 1878 Act to set aside judgments on a motion for a new trial necessarily removed that power from a single judge. The power of the Full Court, as we have seen, was applicable to both equitable decrees and common law judgments. It is difficult to see how any power could remain in a single judge to review a verdict or judgment on the grounds of new evidence, and perhaps even fraud, in those circumstances.
There was no statutory time limit for bringing a motion for a new trial. The terms of the section suggest that the motion for a new trial could be brought even after the judgment had been entered as was the case in Angas v Cowan.[88] Order 36 of the Rules of Court 1878 made provision for motions for new trials. I have not been able to extract the Rule in its original form but, as of 1905, Order 36 provided that the motion was to be brought within four days after the trial, if the Court was then sitting, or within four days of the commencement of the next sitting or such longer time as may be permitted by order. Order 36 of the 1905 Rules also provided that judgments could only be entered by motion on notice within the time specified by the trial court or four days of the trial if no time had been specified.
[88] Angas v Cowan (1883) 17 SALR 110 at 111.
In Angas, this Court held that s 15 of the 1878 Act applied to a decree made in proceedings brought in the equity jurisdiction of the Court concerning a disputed charge over property. Accordingly, an appeal did not lie to the Privy Council until such a motion had been brought and lost. Counsel for the respondent submitted that the effect of conferring exclusive jurisdiction on the Full Court to set aside trial verdicts, and any judgments founded upon them, was that the judgments of the trial court were not final unless and until a motion for a new trial had been brought and dismissed.
In Musgrove v McDonald,[89] the High Court held that no appeal lay to it from a judgment of this Court unless such a motion had been dealt with. The High Court proceeded on the basis that the words of s 73 of the Constitution,[90] “appeals from all judgments, decrees, orders, and sentences” did not include an appeal which impugned a judgment on the ground of error in the verdict if the verdict could be challenged by a motion for a new trial. The High Court held that in the absence of a successful motion for a new trial, it was bound by the findings of the jury and a judgment entered in accordance with that verdict could not be impeached.
[89] Musgrove v McDonald (1905) 3 CLR 132.
[90] The Commonwealth of Australia Constitution Act.
Orders and rules however could be reviewed by an appeal brought pursuant to s 16 of the 1878 Act. An order is a direction made by a court to give effect to its adjudication of a controversy. It is a secondary order which is consequential to, and founded on, the primary adjudication which resolves the dispute between the parties. A rule is an order or direction made during proceedings.[91]
[91] Encyclopaedic Australian Legal Dictionary. A “rule of court” is a direction given in accordance with the terms of a settlement agreed to by the parties.
In Re Bleechmore,[92] the Full Court of this Court considered an application by an executor, and beneficiary under a will, who was dissatisfied with an order made by Poole J in Chambers on an originating summons, that he was indebted to the estate and that account should be taken of that debt in any distribution made to him. The applicant and the Public Trustee were co-trustees of the estate. On the hearing of the originating summons before Poole J, counsel initially appeared for both the Public Trustee and the applicant but, when the conflict appeared, was given liberty to argue the case for the applicant alone. The order made by Poole J on the originating summons was not appealed. It was accepted in the Full Court, on which Poole J also sat, that it was an order which might have been appealed pursuant to s 16 of the 1878 Act,[93] and that further evidence could have been adduced on such an appeal if it had been brought. After the time for appeal had expired, Napier J gave directions as to the final distribution of the estate taking into account the debt of £400. The applicant sought liberty in the Full Court to bring an action to review the order of Poole J on the grounds that it was obtained by fraud, suppression or withholding of evidence and by reason of the discovery of new evidential material. The Full Court held that it had no jurisdiction, as an appeal court, to review the order on those grounds but held that such an application could be made before a single judge. The Full Court went on to discuss, by way of obiter, the nature of the powers of a trial judge to set aside his or her judgments. The Full Court referred to the “old equity practice” by which an examination and reversal of an enrolled decree could be procured by a Bill of Review, without leave, on the ground of error of law on the face of the decree, or with leave, on the ground of the discovery of new evidence.[94] The Court understood, with respect probably mistakenly, Lord Selborne’s opinion in Boswell v Coaks[95] to be that, after the Judicature Acts, permission was not required to bring a Bill of Review in the High Court on the ground of new evidence. The Full Court also referred to the dictum of Cozens-Hardy LJ in Charles Bright & Co Ltd v Sellar.[96]
[92] Re Bleechmore [1925] SASR 112.
[93] It appears to me that the appeal lay pursuant to s 16 of the 1878 Act because of the reform of the procedure for the administration of estates and the ascertainment of debts due to them in the 19^th Century. Disputes were resolved by a more summary procedure which was probably exempted from the trial procedure mandated by s 17 of the 1878 Act and, therefore, the motion for new trial procedure in s 15 of the 1878 Act.
[94] Re Bleechmore [1925] SASR 112 at 114 citing Mitford’s Chancery Pleadings (5^th ed) 101, 102.
[95] Boswell v Coaks (No 2) (1894) 86 LT 365.
[96] Charles Bright & Co Ltd v Sellar [1904] 1 KB 6.
The Full Court then concluded: [97]
It appears to us that there is no need in a case where the application for review is based upon fraud or the discovery of new material facts, to apply to the Full Court for leave to bring an action, but a party may bring such action, subject, of course, to the power of the Court to stay obviously baseless actions and those which are vexatious.
[97] Re Bleechmore [1925] SASR 112 at 115.
Those non-binding observations of this Court in Re Bleechmore are inconsistent with the subsequent authority in England and in Australia to which I have earlier referred. Furthermore, Re Bleechmore was concerned with the power of this Court in its equitable jurisdiction, where the judgment was not based on a verdict. Be that as it may, the power of this Court to review its own enrolled judgments other than by way of appeal is now governed by the Supreme Court Act 1935 (the 1935 Act).
In R v Nam,[98] the Full Court of this Court expressed the view that, in relation to the civil jurisdiction, the power of this Court over its judgments is the same as the power of the High Court of England following the enactment of the Judicature Acts.[99] The Full Court did not, however, express a view on the controversy over the scope of that power to which I have referred above.
[98] R v Nam [1968] SASR 107.
[99] R v Nam [1968] SASR 107 at 112.
Before turning to the specific provisions of the 1935 Act, I mention that the importance of maintaining the finality of judicial decisions was recently emphasised by the High Court in Burrell v The Queen.[100]In the context of the appellate jurisdiction of the New South Wales Court of Criminal Appeal, Gummow A-CJ, Hayne, Heydon, Crennan and Kiefel JJ said:
[100] (2008) 238 CLR 218; [2008] HCA 34 at [14] - [27].
In the case of each such court, State or federal, attention must be given to the text of the governing statutes and any express or implied powers to be seen therein.
…
Secondly, it is important to recognise that underpinning consideration of the issues presented in this matter are fundamental principles about finality of litigation. As was said in D'Orta‑Ekenaike v Victoria Legal Aid: "A central and pervading tenet of the judicial system is that controversies, once resolved, are not to be reopened except in a few, narrowly defined, circumstances." That tenet finds reflection in rules concerning the bringing of an action to set aside a final judgment on the ground that it was procured by fraud and in doctrines of res judicata and issue estoppel. The principal qualification to the general principle of finality is provided by the appellate system. But in courts other than the court of final resort, the tenet also finds reflection in the restrictions upon reopening of final orders after they have been formally recorded.
The third consideration of principle which it is necessary to state at the outset is related to the second. It is that the principle of finality serves not only to protect parties to litigation from attempts to re‑agitate what has been decided, but also has wider purposes. In particular, the principle of finality serves as the sharpest spur to all participants in the judicial process, judges, parties and lawyers alike, to get it right the first time. Later correction of error is not always possible. If it is possible, it is often difficult and time‑consuming, and it is almost always costly.
…
The formal recording of the orders of a superior court of record is often referred to as the "perfecting" of that order. Whether a court may reopen a proceeding and reconsider the order that has been pronounced is often described as hinging about whether the order has been "perfected". This use of terminology must not be seen as giving form and procedure precedence over substance and principle. The questions that arise in this matter must depend for their answer not upon what forms and solemnities have been observed but upon how effect is to be given to the principle of finality. In particular, what is to mark the point at which a court concludes its consideration of a controversy?
The end of a court's powers to consider and determine a controversy cannot depend upon whether one party asserts that the court has made some error in the conclusion it has reached. …It follows therefore that no matter whether it is a party that alleges error, or it is the court itself which believes that it recognises its own error, a decision that an error had been made could be reached only after giving all parties an opportunity to be heard. And it is this reargument of issues that would constitute the departure from the principle of finality.
Identifying the formal recording of the order of a superior court of record as the point at which that court's power to reconsider the matter is at an end provides a readily ascertainable and easily applied criterion. But more than that, identifying the formal recording of the order as the watershed both marks the end of the litigation in that court, and provides conclusive certainty about what was the end result in that court.
…
In Grierson v The King, this Court held that the jurisdiction of the Court of Criminal Appeal of New South Wales "is statutory, and the court has no further authority to set aside a conviction upon indictment than the statute confers". More particularly, this Court held that the Court of Criminal Appeal had no jurisdiction to reopen an appeal which it had heard upon the merits and finally determined. Grierson has been followed in this Court on a number of occasions, most recently in Elliott v The Queen.
The Solicitor‑General for New South Wales, appearing for the respondent in the present proceedings, expressly disclaimed any application to have this Court reconsider its decision in Grierson. Instead, the Solicitor‑General submitted only that, "[i]f there was a denial of procedural fairness in this matter it lay in the fact that the order [disposing of the appeal] was perfected the same day and very soon after the reasons for judgment were handed down" and that "[i]f the denial of procedural fairness qualification referred to in [Pantorno v The Queen] and [Postiglione v The Queen] applied, then this inadvertent procedural unfairness may have allowed the court to reopen the order to allow the acknowledged factual errors to be corrected" (emphasis added).
It is not necessary to consider whether some forms of denial of procedural fairness could warrant grafting some exception upon the general rule stated in Grierson. Nor is it necessary to examine what was said in either Pantorno or Postiglione about these matters. Neither case decided that the general rule in Grierson should be qualified according to whether there had been a denial of procedural fairness. It is therefore not necessary to consider what root could be found in the Criminal Appeal Act for such a proposition, and as both Grierson and DJL make abundantly plain, it is there that the source of any such exception must be found.
Rather, it is sufficient in this case to say that formally recording the orders of the Court of Criminal Appeal before the parties had examined the published reasons of the Court did not amount to any denial of procedural fairness.
(Footnotes omitted)
The High Court referred to a recent amendment to the Criminal Appeals Rules in New South Wales which permitted the Court of Criminal Appeal to set aside a sealed order within 14 days after it was entered. The High Court noted that the validity of the rule had not been argued. The validity of legislation encroaching on the finality of judicial power was commented on by Toohey J in Nicholas v The Queen.[101]
[101] Nicholas v The Queen (1998) 193 CLR 173 at [51], Toohey J observed: “It is apparent from the decision of the Supreme Court of the United States in Plaut v Spendthrift Farm Inc that the limits of legislative encroachment on judicial power can give rise to considerable debate. There the Court, by majority, held legislation unconstitutional to the extent that it required federal courts to re-open final judgments entered before its enactment. But underlying the debate is an acceptance of the proposition that the power to resolve conclusively and to dispose of litigation is a judicial power. A similar debate has taken place in Canada from time to time. Reference re Remuneration of Judges of the Provincial Court of Prince Edward Island; Reference re Independence and Impartiality of Judges of the Provincial Court of Prince Edward Island) is a recent example. The underlying principle remains the same.”
I return to the 1935 Act. The existence of this Court as a superior court of record with all of the jurisdictions previously conferred on it is continued by s 6 of the 1935 Act.
Section 17(2) of the 1935 Act expressly vests in this Court the like jurisdiction in and for this State as was formerly vested in the High Court of Chancery and the superior common law courts immediately before the Judicature Acts reforms. Importantly, s 17(1) constitutes this Court as a court of law and equity. In my view, by constituting this Court as a court of law and equity, the 1935 Act has accumulated in this Court the same powers to control its proceedings and records as were formerly exercised by both the superior common law courts and the High Court of Chancery in England.[102]
[102] I prefer to rely on s 17(1) of the Supreme Court Act 1935 as a source of the Court’s power to set aside its own judgments than on the conferral, pursuant to s 17(2) of the Supreme Court Act 1935, of Chancery’s pre-Judicature Acts jurisdiction because there is no separate common law court over which the jurisdiction can be exercised. Section 25 of the Supreme Court Act 1935 precludes any order by way of prohibition or injunction restraining proceedings in the Court. The predecessors to s 25 did so since 1878. In my respectful opinion, the power to set aside the Court’s own judgments is not a consequence of the prevalence of the rules of equity over the rules of law because, in the power exercised over procedures of the common law courts in Chancery, there could never be any such conflict. Cf. Monroe Schneider Associates (Inc) v No 1 Raberem Pty Ltd [No 2] (1992) 109 ALR 137 at 142.
The power to set aside, vary and reverse judgments in Chancery was, as I have discussed above, generally wider than the powers of the common law courts but there is no indication in s 17 of the 1935 Act that the powers of this Court over its judgments were to vary across its jurisdictions. My view of s 17 of the 1935 Act, that all of the powers of the former superior courts are exercisable across all of this Court’s jurisdictions, is reinforced by this Court’s long history of simultaneous jurisdiction in law and equity since 1853.[103] Subject to any contrary implication from the conferral of a general right of appeal to the Full Court, this Court therefore has, in all its jurisdictions, the same powers over its judgments, before and after they are entered, as were formerly exercised both in Chancery and the superior common law courts. In my view, the powers which were once exercised by Chancery are, necessarily, also available to this Court in the exercise of its jurisdiction in common law actions.[104] The position taken in England since the Judicature Acts, and in Canada, that judgments in common law actions can be reviewed for fraud after enrolment supports that view notwithstanding the doubt expressed by Thesiger LJ in Re St. Nazaire Co.
[103] Supreme Court Procedure Act 1853 ss 175, 176.
[104] I observe in this respect that ss 42 and 43 of the 1935 Act replicated the provisions of the 1878 Act abolishing the significance of the terms of the legal year.

In my respectful opinion, the ratio of the decision of McHugh J in Giannarelli can be limited in the way described by King CJ. If disclosure of a document, or part of a document, on which a claimant for costs relies is necessary in order to ensure procedural fairness then reliance on the document by provision of it to the taxing officer necessarily entails a waiver of privilege which entitles the opposing party to the taxation to see the document or part of it, for the purposes of the taxation. However it is clear enough, I think, that in Giannarelli McHugh J was actually expressing a wider view of the resulting waiver. McHugh J removed any doubt about his view in his dissenting judgment in Mann v Carnell.[158]
[158] Mann v Carnell (1999) 201 CLR 1 at [127].
One of the English decisions referred to by McHugh J in Giannarelli was Pamplin v Express Newspapers Ltd.[159] The English practice required that all of the material supporting the claim for costs, including copies of advices and opinions, be provided to the taxing officer. Hobhouse J noted the tension between the requirements of procedural fairness and litigation privilege and concluded that “in the final resort, the claimant must be put to his election” However, Hobhouse J ultimately held that there was no reason to disclose the particular document which had been sought, even though it had been provided to the taxing officer, because the party seeking it could not show a legitimate forensic reason related to the taxation for inspecting it.
[159] Pamplin v Express Newspapers Ltd [1985] 1 WLR 689; [1985] 2 All ER 185.
The English Court of Appeal subsequently accepted that the waiver of litigation privilege in documents on taxation is limited[160] and that the right to maintain confidentiality is lost only for the purposes of the taxation.
[160] Goldman v Hesper [1988] 1 WLR 1238; [1988] 3 All ER 97 at 101 - 102.
In Goldman,[161] Taylor LJ accepted that it may be appropriate, and sufficient to satisfy the requirements of procedural fairness, to disclose only a part of a privileged document.[162] Moreover, he accepted that the loss of privilege in that circumstance was limited. Taylor LJ said “voluntary waiver … on a taxation would not in my view prevent the owner of the document from reasserting his privilege in any subsequent context.”[163]
[161] Goldman v Hesper [1988] 1 WLR 1238; [1988] 3 All ER 97.
[162] Goldman v Hesper [1988] 1 WLR 1238; [1988] 3 All ER 97 at 101 – 102.
[163] Goldman v Hesper [1988] 1 WLR 1238; [1988] 3 All ER 97 at 102; approved in State Bank of South Australia v Smoothdale (No 2) Ltd (1995) 64 SASR 224 at 227.
The question was again considered in Bourns Inc v Raychem Corp [No 3].[164] The parties to that litigation were American companies which competed in the manufacture and sale of electronic goods. They were involved in litigation both in England and the United States. Raychem sought permission to use documents produced by Bourns in a taxation of the costs of the English proceedings in related proceedings in the United States. The Court of Appeal held that the privileged documents disclosed in the course of the taxation were disclosed only for the limited purpose of that taxation. Aldous LJ said:[165]
In my judgment the views by the Court of Appeal in Goldman’s case as to the extent of waiver of privilege in taxation cases were not obiter. Even if they were, I adopt what was said as correct. It is possible to waive privilege for a specific purpose and in a specific context without waiving it for any other purpose or in any other context. Documents disclosed on taxation in the manner contemplated in Goldman’s case are disclosed for the purposes of that taxation and, perhaps absent special circumstances, the privilege is only waived for the purpose for which the documents are disclosed…
There is good reason to encourage voluntary disclosure of relevant documents in taxation proceedings. A party who claims payment may have to elect whether to pursue that claim in the light of knowledge that it might require disclosure of privileged documents. If he decides to pursue such a claim with the result that natural justice requires disclosure, he should not lose his right of confidentiality more than justice requires. Justice only requires that right to be lost for the taxation proceedings.[166]
[164] Bourns Inc v Raychem Corp [No 3] [1999] 3 All ER 154.
[165] Bourns Inc v Raychem Corp [No 3] [1999] 3 All ER 154 at 162.
[166] Bourns Inc v Raychem Corp [No 3] [1999] 3 All ER 154 at 162 - 163.
The 1935 Act[167] and the 2006 Rules[168] provide that, in general, a successful party will receive an award of costs in his or her favour. That inchoate obligation becomes a legal right and entitlement on the making of the costs order. It is, of course, also a substantive right of the parties to litigation, including the successful party, to have communications with their legal representatives in connection with the litigation privileged from production. If production of privileged documents in the course of taxation of costs were, in itself, to amount to a waiver of privilege, either one or both of those substantive rights would, for all practical purposes, be compromised.
[167] Supreme Court Act (1935) s 40.
[168] Supreme Court Civil Rules (2006) r 263.
It is clearly inconsistent with making a claim for legal costs to refuse to produce material which is reasonably required to validate that claim. However it is not obvious to me why pursuing a claim for legal costs in one action is inconsistent with the assertion of the privilege against production in another action. McHugh J incisively exposed the difficulties inhering in this relativist doctrine of waiver in his dissenting judgment in Mann v Carnell, but in my respectful opinion, the primacy given to the element of inconsistency over unfairness in the judgment of the plurality satisfactorily addresses those difficulties. Moreover, even accepting that the rationale of the privilege would usually not be compromised if the rule were that it was generally waived by voluntary disclosure, the same cannot be said of disclosure for the purposes of recovering the costs of litigation. If the successful party were put to that election, the right to confidentiality would be transformed into a privilege that must be paid for by foregoing the entitlement to costs. Imposing that choice on the successful party would also produce much collateral public mischief. It is more likely to generate unmeritorious litigation than it is to expose erroneous judgments. Indeed if a successful party were to elect to enforce a costs order in its favour, it would expose itself to a risk of an action to impeach the very judgment on which its costs order is based, which it would have to defend having disclosed its litigation documents, but in ignorance of the privileged documents of its opponent.
Counsel for the Players Parties submitted, conversely, that there is both an inconsistency and unfairness in allowing a successful party to claim the costs benefit of a judgment while at the same time maintaining confidentiality over documents which might show that the costs were being wrongfully claimed on a false judgment. However, that proposition assumes that a judgment which might not have been given if otherwise privileged evidence had been adduced is a bad or erroneous judgment. Questions of fraud and abuse of process aside, a judgment cannot be impeached on the basis that the successful party did not make available to its opponent helpful but privileged material. If the unsuccessful party comes across that material independently of the taxation process, he or she may have a remedy on appeal if the further evidence is received in the discretion of the appeal court. However, even if it is also shown on appeal that the successful party was in possession of the material, as privileged material, at the trial, the judgment is not for that reason alone vitiated. Fraud and abuse of process aside, there is no inconsistency in claiming both the privilege and costs because the successful party is entitled to its judgment even if a different judgment might have been given if the privileged evidence had been voluntarily disclosed. The common law trial is an adversarial, not an inquisitorial process. A common law judgment is sound if it is supported by the evidence adduced by the parties in accordance with its procedures and privileges, whether or not it is correct in any universal or absolute sense.
In the ordinary course, it is not necessary to disclose the contents of a file note or an email to resolve a dispute about the costs claimed with respect to it. It is the fact of the making of the note or receipt of the document, its length and any notation as to time spent which is relevant to the costs question. If that proposition is accepted, it follows that r 271(3) of the 2006 Rules, or the Master’s order if it was made under the 1987 Rules, required production of documents which went beyond that which was necessary to ensure procedural fairness. In either case, the width of the obligation is, in my view, a further reason to find that production in accordance with the rule or order did not waive privilege generally and that the production was subject to a rule precluding use of the documents for any other purpose. The decision of Hobhouse J in Pamplin appears to me to be based on similar reasoning.
For the above reasons, I hold that disclosure of the internal documents for the purposes of the taxation resulted in a waiver of litigation privilege only for those purposes. It is therefore not necessary to consider the legal effect of G’s undisclosed and collateral purpose for taking inspection of the internal documents.
Improper Communication not Privileged
There is no privilege in a communication effected for an unlawful purpose.[169] In Commissioner of Australian Federal Police v Propend Finance Pty Ltd, Toohey J extended the scope of communications which were not privileged to communication for an “illegal or improper purpose”[170] and Gaudron J to “communications made for the purpose of frustrating the processes of the law”.[171] The precise scope of the exception remains unclear.[172] In Barclays Bank Plc v Eustice,[173] the Court of Appeal held that the fraud or criminality exception extended to “sharp practice”.[174]
[169] Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501 at 514 (Brennan CJ), at 521 (Dawson J), at 556 (McHugh J), at 575 (Gummow J) and at 592 – 593 (Kirby J).
[170] Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501 at 534 (Toohey J).
[171] Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501 at 546 (Gaudron J).
[172] Attorney-Generalfor the Northern Territory of Australia v Kearney (1985) 158 CLR 500 at 514 (Gibbs CJ), 528 (Dawson J); Carter v The Managing Partner, Northmore Hale Davy & Leake (1995) 183 CLR 121 at 134 (Deane J) at 163 (McHugh J).
[173] [1995] 4 All ER 511.
[174] [1995] 4 All ER 511 at 525. Cf Southern Equities Corporation Ltd (in liq) v Arthur Andersen & Co (1997) 70 SASR 166 at 174.
Whatever the precise scope of the rule with respect to communications engaged in for a purpose unrelated to legal proceedings, general principles suggest that no litigation privilege attaches to communications, or documents evidencing steps taken, for the purposes of abusing the very processes of the Court pursuant to which the litigation is being conducted. The privilege exists to encourage frank communications between clients and their lawyers, and between their legal advisers, in order to facilitate the conduct of proceedings in accordance with the rules, procedures and practices of the Court, and the professional ethics of the legal representatives. Communications and conduct undertaken for the purpose of subverting those processes, or which breach professional conduct rules, are adverse to that public interest and should not attract the privilege. In Attorney-General for the Northern Territory of Australia v Kearney,[175] Dawson J expressly referred to communications made to “frustrate the processes of law” as an example of communications which did not attract legal professional privilege.[176]
[175] (1985) 158 CLR 500.
[176] (1985) 158 CLR 500 at 528 - 529.
Plainly enough it is generally impracticable to conduct an interlocutory hearing into whether the material was, in fact, generated for an improper purpose. For that reason it has been consistently held that it is sufficient that there is material from which the existence of the purpose can reasonably be inferred.[177]
[177] Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501 at 514 (Brennan CJ), 522 - 523 (Dawson J), 534 - 535 (Toohey J), at 546 (Gaudron J), at 556 (McHugh J), and at 592 (Kirby J); Southern Equities Corporation Ltd (in liq)v Arthur Anderson & Co (1997) 70 SASR 166 at 174.
The Players Parties identified the alleged impropriety in paragraphs 53, 54, 55, 57, 59 and 59B of a proposed fourth amended Points of Claim. The proposed Points of Claim was provided for the purpose of identifying with greater particularity the improper conduct which denied the documents the privilege from production they would otherwise enjoy. First the Players Parties contend that it should be inferred from Clone’s solicitors’ decision to expressly exclude the Grenfell Tavern file from the scope of the Notice that it was excluded in order to conceal from the Players Parties the Grenfell Tavern copy of the Agreement. Next they allege that Clone took possession of the Planet Hotel gaming copy when its lawyers inspected the Planet Hotel file which was delivered to the Court but failed to discharge its obligation to discover it. Additionally, they allege that Clone was duty bound to obtain the trial judge’s permission to inspect the files or at least to notify them before doing so. Independently of the above alleged misconduct, the Players Parties allege that Clone’s lawyers were bound to advise the Commissioner of his obligation to make discovery of the Grenfell Tavern copy which was discovered in the searches undertaken at their request. They allege that the duty arose in all of the circumstances including Clone’s knowledge that Players Parties had announced that their efforts to find further copies of the Agreement had been unsuccessful.
In my view, the internal documents, taken at their highest, could support an inference that Clone’s legal representatives were anxious to know in advance if the lawyers acting for the Players Parties had discovered the other copies of the Agreement in the Commissioner’s files so that they could be prepared to respond to such use of them as the Players Parties might make. There may also have been any number of other reasons to seek to be forewarned. However, there is no evidence to suggest, or reason to suspect, that the communications were made for the purpose of concealing the copies from the Players Parties. An inference can be drawn that Clone’s lawyers knew of the existence of both the Grenfell Tavern and the Planet Hotel gaming copies but the internal documents do not evidence, or give any reason to suspect, any communication by Clone’s lawyers which was calculated to hinder the efforts of the Players Parties to locate copies of the Agreement.
Clone’s solicitors were not bound to insist on the production of the copies of the Agreement. They were free to amend the Notice and may have done so for any number of reasons. Even though Notices to Produce are often called on in open court, Clone was not bound to do so. The way in which the Commissioner complied with the Notice did not deny the Players Parties procedural fairness. There is no complaint, for example, of lack of notice of the use of the plans in the file which were deployed by Clone in the trial. The copy of the Agreement was not used against the Players Parties. Importantly, the Players Parties had equal access to all of the Commissioner’s files from the time that the order was made by the Master excusing the Commissioner from providing a list of documents. The procedure adopted for production of the file did not, therefore, deny the Players Parties access to the Planet Hotel gaming copy.
In the absence of a list of documents filed by the Commissioner, the other parties were required to identify the files they wanted produced for inspection.
I received an affidavit of a junior solicitor, F, employed by the firm representing the Players Parties. He deposed that shortly after the trial commenced on 8 April, he attended at the office of the Commissioner. F asked to view all of the Commissioner’s files relating to the Planet Hotel. Volumes (ii) to (v) of the Planet Hotel liquor licence files were produced. He was told by V that Volume (i) could not be found. He did not expressly ask to see the file relating to the Grenfell Tavern. He did not expressly ask for the gaming file. F searched the files which were produced for any copies of the Agreement and found none. I proceed for the purpose of this application, on the basis that the Grenfell Tavern file and the Planet Hotel gaming machine licence files were not produced to him.
However, there is no evidence that Clone or its legal representatives obstructed or interfered with the Players Parties’ inspections. There is no reason to suspect that any of the communication evidenced by the internal documents was made for that purpose. The Grenfell Tavern copy of the Agreement was probably not found by F because he did not specifically request the Grenfell Tavern file. The existence of that file and the existence of the Grenfell Tavern copy within it had been discovered by V on 7 April. It would have been better if it had been produced to F. No explanation has been provided for V’s failure to do so, but neither V nor the Commissioner took an active part in this application. Whatever reason there may have been, good or bad, there is, as I have already observed, no evidence to suggest that Clone’s lawyers played any part in it.
The internal documents do not record a reference to the Planet Hotel gaming copy before the gaming file was produced at the trial. I do not know whether it was noticed by V before the inspection undertaken by F.
Overall, mishap, and not misconduct, is all that can be reasonably inferred or suspected as to the reason for the failure to provide the Grenfell Tavern removal file and the Planet Hotel gaming files to F. There is no evidence at all that it was not produced to him because of any misconduct on the part of Clone or its legal representatives. Nor is there enough to suspect misconduct on the part of V. Another solicitor, T, acting for the Players Parties, filed an affidavit in proceedings. He deposed amongst many other things to speaking to V, who informed him that the files produced to the Court in answer to the Notice were probably delivered by a member of the registry staff. T spoke to that staff member but he was unable to recall any of the circumstances of the delivery of the file. There is no evidence at all that the Commissioner or the CSO intentionally or recklessly disregarded the obligations inhering in the undertaking given to the Master.
No direct evidence has been produced by the Players Parties on this application either directly from V, or by way of a hearsay recitation of information obtained by T, as to the reason for the limited production of files to F on 8 April. There are many reasons why, even accepting the accuracy of F’s account, the other files may not have been produced to him. I would not, on the bare state of the evidence, infer or suspect any wrong doing by V. Be that as it may, there is certainly no evidence of any associated improper conduct on the part of Clone’s lawyers.
Nor is there any evidence that Clone’s legal representative obtained, and took into their own possession, copies of either of the two copies of the Agreement in the Commissioner’s files. A party who inspects a document in the possession of another with that person’s permission does not take possession, custody or control of the document. If the file was left by the Commissioner with one of Clone’s lawyers for the limited purpose of delivering it to the Court that would not amount to possession. Finally, there is no reason to infer or suspect from the file note recording the inspection of the Commissioner’s file that any step was taken to evade the responsibilities to make discovery.

There was no obligation to disclose the internal documents which were, in themselves, irrelevant to any issue in the proceedings.
The allegations of impropriety made by the Players Parties rest fundamentally on their construction of the order that exempted the Commissioner from making discovery. The Players Parties contend that the order and subsequent circumstances cast an obligation on the Commissioner directly, and on Clone indirectly, to bring to the attention of the Players Parties any documents which were materially relevant to the proceedings. Not only does the order fail to impose any such obligation, the manifest purpose of the order is to relieve the Commissioner of any obligation to do so. The very purpose of the undertaking to make the files available was to allow the other parties to take inspection of all of the Commissioner’s file without the need for the documents to be first discovered pursuant to r 58 of the 1987 Rules. The circumstances on which the Players Parties rely amount to no more than the discovery by Clone of the existence of another copy of the Agreement, the evidential significance of which was arguable. However Clone was not bound to share with the Players Parties the fruits of its superior searches of the Commissioner’s files. The Players Parties had equal access to all of the Commissioner’s files. The evidence shows only that they failed to exploit that access as well as Clone’s solicitors did. True it is that the officer of the Commissioner, in order to fully comply with F’s request, could have produced the Grenfell Tavern file and the Planet Hotel gaming file. A more experienced solicitor may well have noticed the absence of those files and may specifically have requested that they be examined just as Clone’s lawyers had. Be that as it may there is no evidence or reason to think that Clone’s lawyers were responsible for V’s omission. The internal documents certainly do not evidence or suggest any involvement by them in V’s response to F’s response.
Clone’s solicitors were not subject to any duty to warn, encourage or remind the Commissioner, or his officers, about his obligations as a litigant. Indeed it would have been improper for them to have interfered in the relationship between the Commissioner and the CSO. In any event, the documents do not evidence communications for an improper purpose which would abrogate the privilege. The very point of the Players Parties’ complaint is that Clone did not communicate an exhortation to discover the copies. Very obviously therefore the absence of any such exhortation does not render the communications, which were made, communications made for an improper purpose.
There is therefore no reason to suspect that the internal documents were generated for, or evidence, improper conduct or purpose on the part of Clone or its lawyers. The internal documents are therefore privileged.
Waiver – Matters Put in Issue by the Pleadings
The Players Parties, by their Points of Claim, allege that Clone, through its legal representatives, was aware of the existence of the Grenfell Tavern copy and that it had not been found by the solicitors acting for the Players Parties. The Players Parties plead as material facts in support of those conclusions the communication between V and Clone’s solicitors evidenced by the internal documents. The Players Parties also allege that Clone, through its legal representatives, took possession of the Planet Hotel gaming copy when the file was produced to the Court by the CSO on behalf of the Commissioner. The Players Parties allege, at least impliedly, that Clone’s solicitors at that time became aware that the Planet Hotel gaming copy was in that file.
Clone admits that it was told by one of the Commissioner’s officers that a copy of the Agreement was found in the Grenfell Tavern file, and that its solicitors requested production of the Planet Hotel files but not the Grenfell Tavern file. Clone admits that its legal representatives inspected the Planet Hotel gaming file but denies that it came into their possession. Clone pleads generally that it, and its legal representatives, properly complied with their obligations of continuing discovery and in connection with the Notice.
The Players Parties contend that by denying the impropriety alleged against it, Clone has waived its litigation privilege in the internal documents. I reject that contention for the following reasons. First, if the internal documents were privileged, their use by the Players Parties in framing the allegations made by them is necessarily an abuse. It would destroy the very purpose of the privilege if in answering allegations based on unauthorised access to privileged documents a person lost the very confidentiality which was wrongly breached.
However, let it be assumed that the allegation of procedural impropriety could properly be made without reference to the internal documents. True it is that the internal documents would be relevant to the issue joined by Clone’s assertion that it acted properly. However, relevance alone cannot abrogate litigation privilege. If it were otherwise, there would hardly be any useful role for the privilege to play. There is no waiver by pleading unless the pleaded fact or circumstance itself expressly or impliedly asserts the content of otherwise privileged communications or conduct in litigation. Most obviously, a pleading of negligence by a client against a former legal representative will assert communications or conduct which are ordinarily privileged. Similarly, a party to an agreement who obtains legal advice on it, but defends a subsequent action for breach on the ground of undue influence, may by so doing impliedly assert the inadequacy of that advice thereby implicating the advice itself and losing privilege in it.[178]
[178] Yokogawa Australia Pty Ltd v Alstom Power Ltd [2009] SASC 377 at [136] – [138]; (2009) 262 ALR 738; Elders Forestry Ltd v Bosi Security Services Ltd [2010] SASC 226 at [13] – [23].
The essential question is whether the pleading expressly, or by necessary implication, asserts something about the content or character of the privileged communication or work.
In its defence to the claim of misconduct against it, Clone does not rely on any exculpating circumstances arising out of its relationship with its legal representatives. Such a plea would probably abrogate the privilege because it would be inconsistent and unfair to defend the misconduct allegation on such a ground and at the same time to insist on the privilege. In its defence, Clone does no more than to deny the conduct and purpose alleged against it. It does not assert anything, either expressly or by implication, about the substance of any otherwise privileged document.
Implied Undertaking
The Court’s power to order discovery and production of otherwise private documents is exercised for the purposes of the just adjudication of the legal controversies brought before the Court. The litigants’ rights of confidentiality and property in the documents, in accordance with common law tradition, are abrogated no further than is necessary for that purpose. Thus parties to litigation who have the privilege of inspecting the otherwise private documents of the other parties to that litigation are subject to an obligation to use those documents only for the purpose for which they were produced. I refer to this rule as the rule of preclusion.
In Hearne v Street,[179] Hayne, Heydon and Crennan JJ stated the obligation in these terms:
Where one party to litigation is compelled, either by reason of a rule of court, or by reason of a specific order of the court, or otherwise, to disclose documents or information, the party obtaining the disclosure cannot, without the leave of the court, use it for any purpose other than that for which it was given unless it is received into evidence.[180]
(Footnotes omitted)
[179] (2008) 235 CLR 125.
[180] Hearne v Street (2008) 235 CLR 125 at 154 - 155.
When the document is received into evidence, the open court principal necessarily overrides the right of privacy.
In Esso Australia Resources Limited v Plowman,[181] Brennan J described the rule of preclusion as prohibiting the use of information for a “collateral or ulterior purpose”.[182] The obligation arises whenever the coercive power of the Court has been employed to enable a person to obtain the documents of another.[183]
[181] (1995) 183 CLR 10.
[182] Esso Australia Resources Limited v Plowman (1995) 183 CLR 10 at 36.
[183] Duke Group Ltd (in liq) v Pilmer (1993) 60 SASR 29 at 44 (Mullighan J).
When is a use collateral for the purposes of this rule? On that question an evaluative judgment must be made. That judgment is informed by the underlying rationale for the rule. In the ordinary course, the close connection between interlocutory applications and the matter in issue will demonstrate an identity of purpose. Similarly, even though an action may comprise multiple parties and causes of action, there is usually a single underlying legal controversy so that documents obtained from one party, or with respect to one part of the claim, can be deployed in all of the claims and counterclaims without infringing the rule of preculsion. However there is, in my view, a clear distinction between the production of documents for a purpose related to the adjudication of the underlying controversy and the production of documents to validate and quantify the costs payable pursuant to an award of costs which is made consequent upon, and incidentally to, the judicial resolution of that controversy.
Of great importance are the legal policy implications if the distinction to which I have just referred is not drawn. If, contrary to my conclusion in [156] above, litigation privilege is waived by the production of documents on a taxation, the mischief which would be caused by allowing the documents to be marshalled for an attack on the judgment will nonetheless generally militate in favour of limiting the use of the documents to the taxation. Where the documents evidence fraud or related impropriety, the interests of justice will be adequately served by the exercise of the discretion to exempt a party from the rule of preclusion.
Even though I have held that an application to set aside orders made at trial for fraud or on analogous grounds may be brought in the same action in which the judgment was entered, the rule of preclusion should still be applied to documents produced only for the purposes of taxation. Documents which were produced on, and for the adjudication of the underlying controversy, do not fall within the rule of preclusion and are available to be used on such an application because of their close relationship to the question raised by the application to set aside the judgment. Indeed the application could not sensibly be determined if it were otherwise, and the documents would be discoverable on that application in any event.
The onus of persuading the Court to exempt a party from the rule of preclusion falls on the party seeking the exemption.[184] The party seeking an exemption must establish special circumstances.[185] Special circumstances may exist where the rationale for the rule is inapplicable or does not apply with as much force as it does in the generality of cases or where there is a strong public interest in allowing the use of the document. That public interest will usually need to be an interest other than, or transcending, the mere private advantage to the other party to the proceeding.
[184] Australian Securities & Investments Commission v Marshall Bell Hawkins Ltd [2003] FCA 833 at [12] (Merkel J).
[185] Esso Australia Resources Ltd v Plowman (1995) 183 CLR 10; Hearne v Street (2008) 235 CLR 125 at [107].
In Springfield Nominees Pty Ltd v Bridgeland Securities Ltd,[186] Wilcox J enumerated a number of relevant considerations in the following passage:[187]
I have reservations about the width of counsel's proposition concerning prejudice. But, generally, I accept these submissions, with the exception of the first. Especially having regard to the adoption by Burchett and Lockhart JJ of the "special circumstances" formula stipulated in Crest, I am not prepared to reject that test in favour of counsel's alternative reference to abuse of process. In saying that, of course, I adopt the explanation of that term given by Burchett J and applied by Lockhart J. For "special circumstances" to exist it is enough that there is a special feature of the case which affords a reason for modifying or releasing the undertaking and is not usually present. The matter then becomes one of the proper exercise of the court's discretion, many factors being relevant. It is neither possible nor desirable to propound an exhaustive list of those factors. But plainly they include the nature of the document, the circumstances under which it came into existence, the attitude of the author of the document and any prejudice the author may sustain, whether the document pre-existed litigation or was created for that purpose and therefore expected to enter the public domain, the nature of the information in the document (in particular whether it contains personal data or commercially sensitive information), the circumstances in which the document came into the hands of the applicant for leave and, perhaps most important of all, the likely contribution of the document to achieving justice in the second proceeding.
[186] Springfield Nominees Pty Ltd v Bridgeland Securities Ltd (1992) 38 FCR 217.
[187] (1992) 38 FCR 217 at [225].
In my view, the circumstance that G did not believe that he was infringing the rule of preclusion is of no particular significance in the circumstances of this case. The discretion is not exercised as a form of discipline over the party making collateral use of the documents. However the circumstance that G undertook the inspection for the ulterior purpose of using the documents to reopen the litigation, if they were helpful to his cause, under the cloak of inspecting the documents for the purposes of taxation is a relevant circumstance. If Clone had known of that purpose, it might have decided not to rely on the documents for the purposes of the taxation.
For the reasons I gave in [157] to [173], the internal documents do not support an inference that Clone or its legal representative engaged in any improper conduct. The internal documents do not even raise a suspicion that they did so. There is therefore no good reason to exempt the Players Parties from their obligation.
If I had found that the documents evidenced an improper purpose and were therefore not privileged, there plainly would have been a very strong case for exemption from the rule of preclusion. However, even if, contrary to my finding in [173] above, I were to accept that there was reason to at least suspect impropriety, I would not, in the circumstances of this case, exempt the Players Parties from their obligation. I would not do so because, even accepting that the internal documents raise a bare suspicion, it remains the case that the Players Parties grounds are speculative in the extreme. To allow the Players Parties to prosecute a case, as serious as the one they have alleged, on speculation about documents produced by Clone pursuant to the compulsory processes of this Court on a taxation, is to promote a mischief of a kind the rule of preclusion is designed to suppress.
Conclusion
I find that the internal documents are privileged and that they are covered by the rule of preclusion. I refuse the application of the Players Parties that they be exempted from their obligation not to make collateral use of them.