FEDERAL COURT OF AUSTRALIA
Coffs Harbour City Council v Australian and New Zealand Banking Group Limited (trading as ANZ Investment Bank) [2016] FCA 306
File numbers: NSD 1021 of 2014
NSD 1018 of 2014
NSD 1020 of 2014
NSD 957 of 2015
NSD 1126 of 2015
NSD 1334 of 2015Judge: RARES J Date of judgment: 1 March 2016 Catchwords: PRACTICE AND PROCEDURE – protection of confidential information – whether court order for production in place of tender of documents preserves confidentiality
PRACTICE AND PROCEDURE – representative proceeding brought pursuant to Pt IVA of the Federal Court of Australia Act 1976 (Cth) – where order for disclosure of litigation funding agreement in accordance with practice note CM 17 – whether legal professional privilege applies to prevent disclosure of a litigation funding agreement – whether protection of confidential information is a relevant ground for redaction of particular provisions of a litigation funding agreement
Legislation: Federal Court of Australia Act 1976 (Cth) Pt IVA Cases cited: Attorney-General v Leveller Magazine Ltd [1979] AC 440
Campbells Cash and Carry Pty Limited and Fostif Pty Limited (2006) 229 CLR 386
Cook v Pasminco Pty Limited (No 2) (2000) 107 FCR 44
CSR Ltd v Eddy (2008) 70 NSWLR 725
Dickason v Dickason (1913) 17 CLR 50 applied
Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49
Grant v Downs (1976) 135 CLR 674 referred to
Hancock v Rinehart [2016] NSWSC 12
Hodges v Waters (No 7) (2015) 232 FCR 97
Hogan v Australian Crime Commission (2010) 240 CLR 651
Kingsheath Club of the Clubs Limited (in liq) [2003] FCA 1034
Marshall v Prescott [2013] NSWCA 152
O’Brien v Komesaroff (1982) 150 CLR 310
Spatialinfo Pty Limited v Telstra Corporation Limited [2005] FCA 455
Date of hearing: 1 March 2016 Registry: New South Wales Division: General Division National Practice Area: Commercial and Corporations Sub-area: Corporations and Corporate Insolvency Category: Catchwords Number of paragraphs: 32 Counsel for the Applicant in NSD 1021 of 2014, NSD 1018 of 2014, NSD 1020 of 2014, NSD 957 of 2015, NSD 1126 of 2015 and NSD 1344 of 2015: C Withers with E Bathurst Solicitor for the Applicant in NSD 1021 of 2014, NSD 1018 of 2014, NSD 1020 of 2014, NSD 957 of 2015, NSD 1126 of 2015 and NSD 1344 of 2015: Squire Patton Boggs Counsel for the Respondent in NSD 1021 of 2014: J R Williams Solicitor for the Respondent in NSD 1021 of 2014: Allens Counsel for the Respondents in NSD 1018 of 2014, NSD 1020 in 2014, NSD 957 of 2015, NSD 1126 of 2015 and NSD 1344 of 2015: IJM Ahmed Solicitor for the Respondents in NSD 1018 of 2014, NSD 1020 in 2014, NSD 957 of 2015, NSD 1126 of 2015 and NSD 1344 of 2015: Clifford Chance ORDERS
NSD 1021 of 2014 BETWEEN: COFFS HARBOUR CITY…
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- AGLC
- Coffs Harbour City Council v Australian and New Zealand Banking Group Limited (trading as ANZ Investment Bank) [2016] FCA 306
- Case
- [2016] FCA 306
- Decision Date
CaseChat Overview and Summary
The court considered the balance between transparency and confidentiality in litigation funding agreements, particularly in representative proceedings. It noted the importance of maintaining confidentiality to prevent tactical advantages and the disclosure of sensitive information that could prejudice the proper administration of justice. The court found that while some aspects of the funding agreement needed to be disclosed to balance the rights and interests of the parties involved, other parts could be redacted to protect confidential information. The court concluded that certain provisions, which revealed tactical advantages or the amount of resources available to the funded party, should remain confidential until further order.
The Federal Court ruled that specific provisions of the litigation funding agreement between the applicant and Litigation Capital Partners Pte Ltd were to be redacted and not published or disclosed to any person other than the parties to the agreement, other class members, and their counsel. These provisions included details related to the termination of obligations, settlement arrangements, and the percentage figure of the funding agreement. The court also ordered the applicant to provide a redacted version of the agreement to the respondent and set the costs of the interlocutory application filed by the respondent. The court emphasised that the redactions were necessary to prevent prejudice to the proper administration of justice.
Orders
Orders of the court
1. Confidential exhibit “LET-1” to the affidavit of Louise Elizabeth Treloar sworn on 1 February 2016 be provided to the Court.
2. Pursuant to s 37AF of the Federal Court of Australia Act 1976 (Cth), until further order the following matter, in the funding agreement between the applicant and Litigation Capital Partners Pte Ltd (titled “Credit Sail II Class Action Funding Agreement”), being the document referred to in order 1, not be published or disclosed to any person other than the parties to that agreement, other members of the class represented in the proceedings, and, counsel and solicitors acting for the applicant, namely:
(a) the percentage figure in cl 1.37;
(b) the matter appearing after “as follows” in cl 11.1(c);
(c) clause 11.1(d) in its entirety;
(d) the matter in cl 12.8 between “will be” in the first line and before “one appointed by the President” in the second last line of the clause;
(e) clause 12.12 in its entirety;
(f) the matter between “LCP is entitled”, and “to terminate its obligations” in the first line of cl 18.1;
(g) the matter between “than obligations accrued”, and “to the Claimant” in the second line of cl 18.1;
(h) all matter in cl 18.2 after "If LCP terminates its obligations pursuant to cl 18.1 above”;
(i) the matter between “If” in the first line of cl 19.1 and “the representative party in a test case or” in the second line of cl 19.1;
(j) the matter between “If" in the first line of cl 19.2 and “the Claimant will be deemed to have terminated” in the second line of cl 19.2; and
(k) all matter in cl 19.5 after “of the Claims of the Claimant at that time or at any later time”.
3. The applicant provide to the respondent a copy of the Credit Sail II Class Action Funding Agreement with only the material set out in sub-paras (a)-(k) of order 2 above redacted.
4. Two thirds of the costs of the respondent’s interlocutory application filed 18 December 2015 be the Respondent's costs in the cause.
THE COURT NOTES THAT:
5. The ground for order 2 is that it is necessary to prevent prejudice to the proper administration of justice.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
Full text does not contain this section.
Evidence
Evidence Before The Court
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Decision
Reasons for decision
Ratio Decidendi
Legal Principle Established
After I ordered the Council to produce the unredacted funding agreement, I determined that a number of the redactions could not be justified after hearing argument from the Council’s counsel. The Council’s solicitors then prepared and provided to the Bank and Standard & Poor’s, over the luncheon adjournment, a newly redacted version that revealed the matter that I had found should not have been concealed. Neither the Bank nor Standard & Poor’s advanced any substantive argument for further disclosure based on the newly revealed matter.Consideration – confidentiality The evident purpose of the order made on 23 June 2015 for provision of the funding agreement pursuant to cl 3.6 of practice note CM 17 and, indeed of both the current and draft practice notes, is to strike a balance between the rights and interests of the parties as they are, or may be, affected by the involvement of, relevantly, the funder, in the six proceedings. The current practice note addresses that balance by creating an expectation of some transparency in respect of the funder’s role and involvement in the conduct of a representative proceeding or class action. In ordinary experience, such proceedings are often complex, expensive and lengthy cases. However, cl 3.6 recognises that some aspects of the relationships between the representative party, or applicant, his, her or its lawyers, the group members or class and the funder should not be revealed at the outset of the litigation. The Court has currently identified an expectation of limited transparency of the funder’s involvement as between the parties to representative proceedings in the current practice note that, however, retains flexibility and, in particular, is subject to the Court’s control in any individual proceeding. The use of such a procedure conforms with what Gummow, Hayne and Crennan JJ (with whom, on this aspect, Gleeson CJ at 407 [1] and Kirby J at 451 [146] agreed) in Campbells Cash and Carry Pty Limited and Fostif Pty Limited (2006) 229 CLR 386 at 435 [95] said, namely:The difficulties thought to inhere in the prosecution of an action which, if successful, would produce a large award of damages but which, to defend, would take a very long time and very large resources, is a problem that the courts confront in many different circumstances, not just when the named plaintiffs represent others and not just when named plaintiffs receive financial support from third party funders. The solution to that problem (if there is one) does not lie in treating actions financially supported by third parties differently from other actions. And if there is a particular aspect of the problem that is to be observed principally in actions where a plaintiff represents others, that is a problem to be solved, in the first instance, through the procedures that are employed in that kind of action. (emphasis added) I am of opinion that the rationale for permitting redactions to be made to funding agreements contemplated by the terms of cl 3.6 of practice note CM 17, cl 6.3 of the draft practice note and the authorities to which I have referred, is the protection of confidential information. One reason why such information may be confidential in a particular case is that its disclosure would confer a tactical advantage or would reveal the amount of resources available to the funded party or would reveal information of a kind referred to in the relevant provisions of current and draft practice notes. The basis on which such information may be confidential will depend on the facts in any particular case, and the means for making any assessment of that basis may vary from case to case: cf Hodges v Waters (No 7) (2015) 232 FCR 97 at 118-119 [104] per Perram J; O’Brien v Komesaroff (1982) 150 CLR 310 at 326-327 per Mason J with whom Murphy, Aickin, Wilson and Brennan JJ agreed.