Coney Fair Amusement Pty Ltd v Heath
[2000] QDC 238
•19 July 2000
DISTRICT COURT OF QUEENSLAND
CITATION: Coney Fair Amusement Pty Ltd v. Heath [2000] QDC 238 PARTIES: CONEY FAIR AMUSEMENT PTY LTD (Plaintiff)
v.
KATHLEEN HEATH (Defendant)FILE NO/S: 1391 0f 2000 DIVISION: PROCEEDING: ORIGINATING COURT: District Court Brisbane DELIVERED ON: 19 July 2000 DELIVERED AT: Brisbane HEARING DATE: 20 June 2000 JUDGE: Samios DCJ ORDER: CATCHWORDS: EQUITY – equitable remedies – Anton Piller Order – discharged – onus upon plaintiff to show good reasons why the plaintiff should retain any advantage gained from the order – onus not discharged - all documents including copies to be returned – electronic copies to be deleted – plaintiff’s solicitors nominated in order bound by undertaking not to disclose information from defendant’s documents to plaintiff
Guess? Inc & Ors v. Lee Seck Mon & Ors (1987) FSR 125
Columbia Pictures Industries Inc v. Robinson & Ors (1987) Ch. 38; (1986) 3 All ER 338
Exagym Pty Ltd v. Professional Gymnasium Equipment Company Pty Ltd (No. 2) (1994) 2 Qd.R. 129
Chappell v. United Kingdom (1989) FSR 617
W E A Records Limited & Ors v. Visions Channel No. 4 Limited & Ors (1984) FSR 404COUNSEL: Mr Amerena for the plaintiff
Mr Hack for the defendantSOLICITORS: Hall Payne for the plaintiff
Minter Ellison for the defendant
This application filed by the plaintiff in these proceedings on 13 June 2000 seeks a number of orders with respect to the future conduct of the proceedings.
The orders sought are:
1. Directions –
(a) That the solicitors for the plaintiff be given leave to disclose to the plaintiff the contents of the draft further amended Statement of Claim tendered and sealed by the court on 15 May 2000 pending further orders;
(b) That the plaintiff have leave to file and serve a further amended Statement of Claim in the terms of the draft sealed by the court on 15 May 2000;
2. That the plaintiff and the defendant deliver a list of documents within 14 days and that each party request and deliver copies of documents mentioned in the lists within 14 days of such request;
3. That within seven days the plaintiff’s solicitors deliver to the defendant’s solicitors for their safe keeping, those copies of documents copied and seized as a result of the execution of the order of Judge O’Sullivan dated 7 April 2000 other than:
(a) “Events In Tents – Kathy Heath” business cards;
(b) plastic covered bundle of folding “Events In Tents” business cards; and
(c) “Events In Tents” envelopes.
4. Such further other orders or directions which to the court seem fit;
5. An order that the costs of and incidental to the application be reserved.
The order of Judge O’Sullivan dated 7 April 2000 was an “Anton Piller Order” and was made ex parte.
The plaintiff commenced these proceedings in this court on 6 April 2000. By those proceedings the plaintiff claimed against the defendant:
(i) injunctions;
(ii) damages for:
(a) passing off;
(b) breach of the terms of a deed of release;
(c) breach of equitable duties; and
(d) reach of an employment agreement;
(iii) accounts and inquiries;
(iv) compensation under the Fair Trading Act; and
(v) interest under the Supreme Court Act.
When on 7 April 2000 the Anton Piller Order was made ex parte, the usual undertaking as to damages was given. The effect of Her Honour’s order gave the plaintiff access both to the defendant’s home and to listed documents. The order was carried out.
On the return day of Her Honour’s order (on 13 April 2000), Judge Wylie Q.C. heard the plaintiff’s application for an injunction pending trial which the plaintiff filed on 10 April 2000, and heard the defendant’s application to discharge the Anton Piller Order. Judge Wylie Q.C. reserved his decision regarding those applications. Subsequently, at the request of the parties or of one of them, he relisted the matter for further hearing on 15 May 2000 and, in the meantime, took no steps to publish the judgment he had in draft form (see reasons for judgment, Wylie Q.C. D.C.J., p.3).
On 15 May 2000 Judge Wylie Q.C. ordered that the order of Judge O’Sullivan dated 7 April 2000 be discharged. Further, the plaintiff’s application for interlocutory relief was refused and he ordered that the plaintiff pay the defendant’s costs of and incidental to the appearances on 13 April 2000 and 15 May 2000.
Judge Wylie Q.C. also directed that:-
(a) The documents entitled Affidavit of Cameron Alexander McCracken sworn 9 May 2000 and further amended Statement of Claim be placed in an envelope which would be sealed and marked “Only to Be Opened With An Order of a Judge”;
(b) The parties consider the terms of any further orders that may be required and adjourn consideration of what further orders may be made to a date to be fixed.
In the course of his reasons for discharging the Anton Piller Order, Judge Wylie Q.C. examined the evidence filed in support of the application for the making of the Anton Piller Order. He referred to statements in the Anton Piller case. Firstly, by Lord Denning MR to the effect that the court may make this type of order in the most exceptional circumstances and should only be made where it is essential that the plaintiff should have inspection so that justice can be done between the parties. He also referred to the statement of Ormrod LJ at p.61 in the same case:
“The proposed order is at the extremity of this court’s powers. Such orders, therefore, will rarely be made, and only when there is no alternative way of ensuring that justice is done to the applicant”.
He also quoted from Ormrod LJ at p.62 where he said:
“There are three essential pre-conditions for the making of such an order … First, there must be an extremely strong prima facie case. Secondly, the damage, potential or actual, must be serious for the applicant. Thirdly, there must be clear evidence that the defendants have in their possession incriminating documents or things, and that there is a real possibility that they may destroy such material before any application inter parties can be made.”
Judge Wylie Q.C. concluded that the material filed in support of the application fell well short of demonstrating a very strong case even at the prima facie level. Further, he did not consider that the potential or actual damage (if any) had been shown to be at the level of “very serious” or “irreparable” citing Golf Lynx v. Golf Scene Pty Ltd (1984) 75 F.L.R. 303 at 312. His Honour also referred to having to bear in mind that he had to come to “the conclusion that it is necessary for the long-term protection of the plaintiff that such a Draconian course should be taken” citing Sega Enterprises Ltd v. Arca Electronics (1982) F.S.R. 525 per Templeman L.J. (as he then was). His Honour observed any damage in his view was short term because the telephone directory relevant to some of the issues in the proceedings would be replaced in coming months. Further, he did not consider that the material clearly or otherwise demonstrated that there was a real possibility or a “grave danger” when the Anton Piller Order was made, that the defendant would or might destroy or otherwise secrete evidence of her alleged misconduct had she become aware the plaintiff was about to seek such an order against her. His Honour also expressed his opinion that the risk that a defendant may suppress or destroy evidence is always present in any case. Further, that ordinarily a plaintiff must accept that risk. Therefore, having heard the submissions from both parties and closely examining the material in support of the application, he was satisfied the order of Judge O’Sullivan made on 7 April 2000 ought to be vacated. His Honour concluded regarding the Anton Piller Order that the plaintiff could still plead its case and enjoy its rights to disclosure by the defendant.
The plaintiff amended its Statement of Claim on 19 April 2000. The amendments provide further particulars for most of the breaches alleged in para. 19 of the Statement of Claim and deletes an allegation of a breach of s.40 of the Fair Trading Act and relief under that Act. Otherwise the relief claimed in this amended Statement of Claim sought to expand the injunctions sought to a post office box number as Ascot.
The defendant filed her Notice of Intention to Defend on 2 May 2000.
On the hearing of the application before me with the consent of both parties I ordered that the documents Judge Wylie Q.C. directed on 15 May 2000 be sealed in an envelope be opened. That was because the parties on the hearing of the application before me agreed that part of the material that I would consider would be that further amended Statement of Claim (the further amended Statement of Claim).
The further amended Statement of Claim is, in my opinion, substantially amended. In terms of relief sought by the plaintiff, the effect of the amendments are that the plaintiff does not seek the injunctions previously sought, nor damages for passing off, breach of equitable duties and breach of the employment agreement. Further, the plaintiff no longer seeks accounts and inquiries. What the plaintiff now seeks in these proceedings is damages for breach of the terms of the deed in the sum of $62,508.60 and interest on such damages pursuant to the Supreme Court Act.
On the hearing of the application before me, the plaintiff relied upon an affidavit of Mr. Binnie filed 13 June 2000. Mr. Binnie exhibits to his affidavit two letters passing between the parties’ solicitors. The first letter is from the defendant’s solicitors to the plaintiff’s solicitors dated 31 May 2000. In this letter the defendant’s solicitors refer to the order made by Judge Wylie Q.C. on 15 May 2000. The solicitors submit in this letter that orders in terms similar to those made by Justice Byrne in Exagym Pty Ltd v. Professional Gymnasium Equipment Company Pty Ltd (No. 2) (1994) 2 Qd.R. 129 would be appropriate. The suggested orders being:
“(a) The following documents be removed from the file and returned to us for same keeping:
(i) affidavit of Cameron McCracken sworn on 9 May 2000; and
(ii) the further amended Statement of Claim.
(c) You deliver to us, for their safe-keeping:
(i) all copies of the documents referred to in para. (a); and
(ii) all documents copied and seized as a result of the execution of the order of Judge O’Sullivan dated 7 April 2000, other than:
A: “Events In Tents – Kathy Heath” business cards;
B: Plastic covered bundle of folding “Events In Tents” business cards; and
C: “Events In Tents” envelopes; and
D: You delete all electronic copies of the documents referred to in para (a).”
The defendant’s solicitors asked for the plaintiff’s solicitors to advise whether the plaintiff would consent to those orders being made. They also asked for advice whether the plaintiff would be delivering a further further amended Statement of Claim. The defendant’s solicitors stated their expectation was that it would be in terms similar to the further amended Statement of Claim delivered on 15 May 2000, but without any information obtained from the defendant’s documents (such as the identify of the callers allegedly not referred to the number 3286 6366). In this letter the defendant’s solicitors contented that as a result of the information obtained from the defendant’s documents pursuant to the order which was subsequently discharged, the plaintiff’s solicitors’ firm was in a position of conflict between the duty owed to their client and the duty owed to the court pursuant to the undertaking given by Mr. McCracken. They sought confirmation from the plaintiff’s solicitors that the plaintiff’s solicitors would cease acting in the matter and would withdraw as solicitors on the record.
The letter in response from the plaintiff’s solicitors to the defendant’s solicitors is dated 6 June 2000. The plaintiff’s solicitors in their letter and in submissions made to me submitted the orders made by Justice Byrne in Exagym were not appropriate to the facts before me. The plaintiff submitted Exagym could be distinguished from the facts I am considering in this application. The plaintiff submitted that notwithstanding Judge Wylie Q.C. found that the Anton Piller Order ought to be discharged, there could be no question that it was originally sought and granted by Judge O’Sullivan in aid and for the purposes of an action, inter alia, for damages for breach of clause 4 of the deed so as to enable the plaintiff to recover and preserve evidence for the purpose of the just and proper prosecution of that action. Therefore, it was submitted that only the order in para. 1(b) set out in the defendant’s solicitors’ letter dated 31 May 2000 was appropriate. It was also submitted that in any event the orders sought by the defendant’s solicitors in paras. 1(a) and (c) went beyond any order in fact made by Justice Byrne in Exagym.
The plaintiff also submitted in that letter and submitted on the hearing of this explanation the further amended Statement of Claim has not been shown to the plaintiff or its contents discussed in any way with the plaintiff. Further, it was prepared by the plaintiff’s legal advisers after an examination and consideration of the documents seized in execution of the Anton Piller Order. Therefore, notwithstanding the discharge of the Anton Piller Order, the defendant is still required to make proper and complete discovery in the action. Therefore, the interests of justice could not be served by, at further pointless cost and expense, delaying, until after the defendant properly discharges its obligation of discovery to the plaintiff, the proper particularisation of what in truth should be the plaintiff’s properly particularised claim against the defendant.
Hence, in this application before me, the plaintiff seeks those orders which would permit the solicitors for the plaintiff to disclose to the plaintiff the contents of the draft further amended Statement of Claim tendered and sealed by the court on 15 May 2000 pending further order and that the plaintiff have leave to file and serve that further amended Statement of Claim in terms of the draft sealed by the court on 15 May 2000.
With respect to the contention of a conflict of interest for reasons expressed by the plaintiff’s solicitors in their letter, the plaintiff’s solicitors did not accept there was any conflict and further expressed the plaintiff’s desire that the plaintiff’s solicitors’ firm stay in the action, as changing solicitors would, in fact, expose her to much further expense and delay. The plaintiff’s solicitors claimed that the defendant’s solicitors had not made any, nor could properly make any, allegation that the current situation would cause any undue prejudice to the defendant.
In case reference to the contentions made in the correspondence is insufficient with respect to the plaintiff’s submissions made before me, the plaintiff did submit on the hearing of this application that the approach suggested by the defendant’s solicitors is such that it would delay, at further cost and expense, that which is immediately capable of being sensibly articulated as a true controversy which, in the interests of justice, ought to be decided between the parties. Further, the orders sought by the defendant in that respect smack of a tactical ploy. If granted they would, at best for the plaintiff, cause it delay and further expense as legal work already done would have to be revisited, and at worst would, particularly if there is any difficulty in obtaining proper discovery from the defendant, interfere with the proper articulation of the plaintiff’s case against the defendant.
Further, it was submitted premature discovery of that material which ought, in the normal course of an action be discovered, does not of itself sound an unfairness. It was submitted this situation is to be distinguished from the premature obtaining of material which would not, in the normal course of discovery in an action, be discovered. Further, any complaints on the part of the defendant to the wrongful prematurity of both material which ought to have been discovered in the normal course of the action and material which should not have been discovered in the normal course of the action can be addressed by:
(a) action on the undertaking as to damages given by the plaintiff to obtain the Anton Piller Order in the first place;
(b) delivery by the solicitors for the defendant for their safe-keeping of the documents referred to in para. 1(b) in the defendant’s solicitors’ letter.
It was submitted sensibly and particularly informed by the draft further amended Statement of Claim when filed, the solicitors for the defendant can then ensure on behalf of their client that their client meets her obligations for discovery. Further, it is hardly appropriate to make an order which may detract from ensuring a party in the defendant’s position makes proper discovery.
I refer to the further amended Statement of Claim and in particular to para. 7. In this paragraph there is an allegation of a breach of clause 14.3 of the deed, and it is alleged:
“The defendant after 21 December 1999 and until on or about 10th April 2000 failed to refer callers inquiring about wedding events in relation to the plaintiff or the business “Events In Tents”, in courteous tones, to 3286 6366.”
Particulars are provided of the names of persons alleged to be callers not so referred whom it is alleged telephoned inquiring about wedding events in relation to the plaintiff or the business “Events In Tents” and the dates it is alleged these caller’s telephone inquiry was not so referred. The names of 46 callers and except for two callers, the dates the caller made an inquiry are provided by way of particulars of an alleged breach of clause 14.3 of the deed. The 19 April 2000 amended Statement of Claim pleaded a number of clauses of the deed, including clause 14.3. Then in para. 19 pleaded a breach of the terms of employment and further or alternatively, the obligations referred to in a previous paragraph and further or alternatively the terms of the deed and then provided particulars of the breach of clause 14.3 in these terms:
“The defendant has not referred any inquiries regarding the business or the plaintiff from persons who had telephoned the number 3868 2886 from 9 November 1999 up to and including 7 April 2000.”
That is, the 19 April 2000 amended Statement of Claim did not provide particulars of the 46 specific callers and the dates which are provided as particulars in the further amended Statement of Claim.
As I understood the plaintiff’s submissions, those submissions were to the effect that the Anton Piller Order provides for premature discovery, even though the Anton Piller Order has been discharged. In any event the defendant would have to give up these documents during the discovery process in the normal course, and therefore as the plaintiff already has had access to these documents and is able to plead the case it wants to plead, directions should be given to allow the plaintiff to deliver this further amended Statement of Claim and be informed of the information gained by the plaintiff’s solicitors during the execution of the Anton Piller Order. Otherwise, delay and expense will be involved which does not advance the interests of justice. Further, that the Uniform Civil Procedure Rules and the Civil Justice Reform Act require that delay and expense be avoided and to not make the directions sought by the plaintiff would be contrary to the intention of those rules and that Act.
The defendant on the other hand submitted:
(a) the plaintiff obtained an order ex parte in circumstances in which it ought not to have been granted the order;
(b) it used the order to obtain copies of documents;
(c) it has used the copies of the documents as a basis for repleading its case;
(d) it not only should return all the documents (both hard copies and electronic copies) it should also be prevented from making any use of the information obtained by it wrongfully. That is, it should not derive any advantage from the original order.
Further, the defendant submitted the plaintiff chose, despite clear practice to the contrary, not to have an independent solicitor present, instead it chose to have one of its solicitor’s present for the execution of the order. That solicitor gave an undertaking that Judge Wylie Q.C. considered was binding.
Further, the defendant submitted that the plaintiff now seeks:
(a) to gain an advantage from the original order;
(b) to circumvent the ruling that the undertaking is still binding.
Further, that an order for disclosure is both premature and unnecessary. It is premature because it envisages disclosure within 14 days. Further, it will inevitably be before the defendant has pleaded to any amended Statement of Claim and thus before any definition of issues. In any event, the Uniform Civil Procedure Rules imposes both the obligation to disclose and the time for it to occur.
Further, the plaintiff’s application does not go far enough. On its face it seems to admit of the possibility that the plaintiff is at liberty to retain any copies that it has made of the original copies. If that is sought, then it ought to be clearly sought and not merely to be an available interpretation of an order. But in the circumstances of this case, the plaintiff should not only return the copies made when the order was executed, but also any copies made of those copies. In addition, any electronic copies ought to be deleted and all copies of Mr. McCracken’s affidavit delivered to the solicitors for the defendant.
In Exagym an Anton Piller Order had been made upon an ex parte application by a plaintiff to a Chamber judge. With the benefit of that order, documents and items were seized. The applicant in that case sought to have the Anton Piller Order made by the Chamber judge set aside, contending that it should not have been made because its object was to facilitate proof of conduct exposing the applicant and others to punishment or penalty. Justice Byrne in that case found that the order was not in aid of relief sought against the defendants in litigation that was already on foot between the parties which was the justification for an Anton Piller injunction. Further, it was not an order issued for a purpose which incidentally involved some chance of revealing evidence tending to disclose an act of disobedience to a court order. Rather, he found its “specific” or as counsel for the respondent preferred to describe it, “dominant” purpose was to facilitate proof of a contempt case: proceedings in which the alleged contemnors were exposed to punishment, or, in the case of the corporations, sequestration In His Honour’s opinion, an injunction should not be granted for such a purpose. Consequently, His Honour ordered that the order should be set aside. Further, it having been the occasion for the respondent’s acquisition for the things seized, they should be returned. The report of the judgment suggests that His Honour contemplated making an order that copies that had been filed with affidavits to be relied on at the contempt proceedings should be removed from the file and returned to the respondent’s solicitors. Then those solicitors would deliver to the applicant’s solicitors, for their safe-keeping, the things taken and all copies. The judgment though indicates His Honour would hear submissions as to the form of orders and costs.
On the hearing of the application before me, it was submitted by the plaintiff that the judgment of His Honour Justice Byrne in Exagym demonstrated that His Honour was not prepared to make orders that would be as extensive as those sought by the defendant on the hearing of this application.
Insofar as in Exagym Justice Byrne found that the purpose behind the seeking of the Anton Piller Order was to advance the applicant’s claim in a contempt proceeding which was separate from the litigation the applicant was already engaged in, Exagym is distinguishable from the present circumstances. However, what in my opinion is established by Exagym is that if the courts compulsory process has been employed for a purpose foreign to the power, then the party having the benefit of that power should derive no advantage in the event the order is set aside and even though it has been completely executed. However, I do not take His Honour’s ruling to be a ruling that the court does not retain a discretion. It was not submitted by the defendant on the hearing of this application that the order made by Judge O’Sullivan was employed for an improper purpose. Nor was it submitted that Judge Wylie Q.C. could have set aside the Anton Piller Order because of non-disclosure of material facts (innocent or otherwise).
Although the defendant submitted that the plaintiff chose, despite clear practice to the contrary, not to have an independent solicitor present, instead it chose to have one of its solicitors present for the execution of the order, it was conceded on the hearing of the application before me that Judge O’Sullivan was informed that it was not proposed to have an independent solicitor present and that one of the plaintiff’s solicitors would be present for the execution of the order, and having been told that, Her Honour made the order in the form that did not provide for an independent solicitor to be present.
In Halsbury’s Laws of Australia, vol. 12 at para. 185-1490, the learned authors state:
“An Anton Piller Order may be set aside on various grounds, including that there were no, or no sufficient grounds, for making the order, that the plaintiff failed to disclose material facts when applying for the order, or that the order was improperly or oppressively executed. Where the order is set aside, the defendant will be relieved from complying further with any injunctions contained in the order, and documents or other property seized under the order will be returned to the defendant.”
The learned authors cite for these propositions Chappell v. United Kingdom (1989) FSR 617, a decision of the European Court of Human Rights. These propositions are consistent with what His Honour Justice Byrne said in Exagym at p.130:
“The order having been made ex parte, it may be set aside if it should not have been made, even though it has been completely executed: Columbia Pictures Industries Inc v. Robinson (1987) Ch. 38, 84-85; M Dockray & H Laddie “Piller Problems” (1990) 106 L.Q.R., 601, 618. The point of doing so here is to establish a right to the return of the things seized and copies.”
Of course, neither Chappell’s case nor Exagym ruled whether solicitors for a party in whose favour an Anton Piller Order has been made and who are nominated in the order, which is discharged are required to cease acting in the matter.
In my opinion, the decision of the Court of Appeal in W E A Records Limited & Ors v. Visions Channel No. 4 Limited & Ors (1984) FSR 404 is authority that upon an application to discharge an Anton Piller Order the “fruits” of the order could be used to show that the making of the order was justified. Certainly, the members of the Court of Appeal in W E A Records Limited supported the reality of the results of the execution of an Anton Piller Order. In that case, the Anton Piller Order had been executed. However, the defendants sought to go back to the beginning of the action, saying that regardless of whether the fruits of the order were such as to show that it was abundantly justified, the learned judge who made the order had insufficient material to justify his action at the ex parte stage. The defendants invited the members of the Court of Appeal to set the ex parte order aside and to order the return of the affidavits to the two personal defendants and the seized material to the defendant’s solicitors. What happened in W E A Records Limited was that instead of applying to the judge who granted the Anton Piller Order to set it aside or to another High Court judge if that judge was not available, the defendant sought to appeal against the Anton Piller Order made ex parte to the Court of Appeal. The Court of Appeal held in that case that there was no power to enable a judge of the High Court to adjourn a dispute to the Court of Appeal and as it was difficult if not impossible to think of circumstances in which it would be proper to appeal to the Court of Appeal against an ex parte order without first giving a judge of the High Court an opportunity of reviewing it in the light of argument from the defendant in reaching a decision, the Court of Appeal dismissed the appeal. In the course of the reasons though, the Master of the Rolls, regarding the use of the “fruits” of the order and the contention of the defendant that the “fruits” could not be relied upon to determine if the order was justified in the first place considered the contention as wholly absurd. The Master of the Rolls said at p.410:
“The courts are concerned with the administration of justice, not with playing a game of chess. If it were now clear that the defendants had suffered any injustice by the making of the order, taking account of all relevant evidence, including the affidavits of the personal defendants, and the “fruits” of the search, the defendants would have their remedy in the counter undertaking as to damages. But this is a matter to be investigated by the High Court judge who is seized of the matter, and only when he has reached a decision can this court be concerned.”
A similar approach was taken by Lord Justice Dunn where at p.411 he said:
“The case of Hallmark Cards Inc v. Image Arts Limited, to which my Lord has referred, shows that the court looks at the reality of the situation, including any evidence filed or statement made by counsel by way of admissions after the execution of the Anton Piller Order. If consequent upon the grant of the Anton Piller Order the evidence shows that the order was in fact justified, then the fact that the evidence before the learned judge was not as strong as it ultimately became does not, in my view, provide a ground for challenging the order itself. It does not, of course, affect the situation if the order was obtained mala fide or by some material non-disclosure, but neither of those matters are alleged in this case, and I too would dismiss the appeal for the reasons given by my Lord.”
In Guess? Inc & Ors v. Lee Seck Mon & Ors (1987) FSR 125, the plaintiffs had obtained an Anton Piller Order in an action for inter alia infringement of copyright. At the inter partes hearing of the summons, the defendants applied to discharge the order. The judge found there had been substantial and serious non-disclosure of relevant facts by the plaintiffs, and that the evidence did not support the inference of a real possibility that documents or things would be destroyed, and discharged the order. After an adjournment, the plaintiff’s applied for a fresh Anton Piller Order and an interlocutory injunction. The judge rejected the application of the Anton Piller but granted the injunction. In doing so he took the “yield” from the Anton Piller into account on the ground that it would be pedantic to exclude evidence which had been extensively referred to during the hearing. On appeal, the seventh defendant contended that the judge, having discharged the Anton Piller Order, should not have taken the “yield” into consideration when deciding whether to grant the injunction. The Court of Appeal of Hong Kong allowed the appeal. It held the judge had a discretion as to whether to exclude evidence obtained as a result of an order which had been granted on the basis of non-disclosure. Further, even though the non-disclosure had been innocent, the court should not lightly allow a party to keep the benefit of it. Where the non-disclosure was serious and substantial, as in that case, the court should only allow use of the “yield”
for good and compelling reasons. The Court of Appeal held the reasons relied upon by the judge fell short of that standard, and so the “yield” ought not to have been taken into consideration. Therefore, in the absence of the “yield”, the evidence did not establish that there was a serious question to be tried.
In my opinion, the proceedings between the plaintiff and the defendant are still the subject of supervision by this court. Further, I have a discretion as to the orders I can make in the supervision of these proceedings. If I were satisfied that the plaintiff used the order made by Judge O’Sullivan for an improper purpose, then as Justice Byrne did in Exagym, the court’s approach must inevitably be to restore matters to as they were before the order was executed, and to make orders that did not allow the applicant any advantage to be derived from the order.
Of course, mala fides or non-disclosure of material facts leading to the making of the order (innocent or otherwise) is not alleged in this application. The defendant’s submission is that the order made by Judge O’Sullivan ought not to have been made. The application to Her Honour was presented as being urgent, and on the face of the evidence, suggested risk that evidence would be destroyed if Her Honour did not make the order. However, Judge Wylie Q.C. considered the evidence upon the return date for the order and decided the Anton Piller Order should be discharged. That occurred soon after the Anton Piller Order was made.
The making of an Anton Piller Order has been described as “Draconian”. The impact that this type of order can have and the interference upon a party’s rights to enjoy the privacy of their residence, and the freedom to trade are convincingly argued by Scott J in Columbia Pictures Industries Inc & Ors v. Robinson & Ors (1987) Ch 38; (1986) 3 All ER 338.
Nevertheless, the question before me is what should now happen? The order was obtained and executed. The order has been set aside. The order was set aside on the basis that a review of the material filed in support of the application did not support the three essential pre-conditions for the making of such an order. Strangers to the defendant entered her residence where she carried on her business and executed the order. In my opinion, the authorities I have referred to show that in the exercise of my discretion I ought not to allow the plaintiff to gain any advantage from the Anton Piller Order once it is discharged unless the plaintiff persuades me there are good reasons why the plaintiff should retain any advantage gained from the order.
In this particular case, what started as a claim for injunctions, damages for passing off, breach of a deed of release, breach of equitable duties, breach of an employment agreement, accounts and inquiries, compensation of the Fair Trading Act and interest under the Supreme Court Act, through a process of amendments, including those amendments supported by copies of the documents obtained through the execution of the order which has now been discharged has become a claim for damages in a sum of $62,508.60 and interest on those damages pursuant to the Supreme Court Act.
If the claim as pleaded in the further amended Statement of Claim without the additional particulars was the basis upon which an order was sought for premature discovery, in my opinion it is unlikely the application would have succeeded. The inference I draw from a comparison of the Statements of Claim in evidence before me is that it is the access the plaintiff’s solicitors have had to the defendant’s documents from the execution of the Anton Piller Order that has enabled the plaintiff to provide particulars of the 46 persons and dates it is alleged callers were not referred on to the plaintiff.
However, I do not accept the plaintiff’s claim in this application that the plaintiff would be entitled to disclosure of the documents it admits to using to make the allegations the plaintiff makes in the further amended Statement of Claim.
That is, because I consider the plaintiff is making an assertion that the documents that have been obtained upon execution of the Anton Piller Order are documents the defendant would be obliged to disclose in these proceedings. That is, on the pleadings excluding the further amended Statement of Claim. In my opinion, when it is alleged by the plaintiff that the obligation of the defendant was, for example, pursuant to clause 14.3 of the deed, to refer any callers who telephoned in relation to the employer or the business “Events In Tents” in courteous tones to 3286 6366, it would be a matter for the defendant to disclose documents in the performance of her duty of disclosure, the defendant considers are required to be disclosed regarding that allegation. In my opinion, it is not for the plaintiff to assert in this application the documents it has had access to during the execution of the Anton Piller Order will be disclosed in due course because the plaintiff claims those documents ought to be disclosed in due course. For example, if the first person named under the heading “Particulars” in para. 7 of the further amended Statement of Claim is referred to in a document that was in the possession of the defendant, it does not follow and it has not been proved to my satisfaction on the hearing of this application to the standard required, namely on the balance of probabilities, that person was a caller inquiring about wedding events in relation to the plaintiff or the business “Events in Tents”. The same criticism in my opinion applies to the names of other persons provided under the heading of “Particulars” in para. 7 of the further amended Statement of Claim.
In my opinion, these circumstances are compounded by the nomination of the plaintiff’s solicitor as the solicitor for the purposes of the order. I have acknowledged that the plaintiff informed Her Honour of the intention that the plaintiff’s solicitor be the solicitor for the purposes of the order, and that he was not an independent solicitor, and Her Honour in any event made the order. However, in my opinion, if an applicant for an Anton Piller Order obtains an order that does have the plaintiff’s solicitor as the solicitor nominated for the purposes of the order, then the plaintiff takes the risk that in the event the order is discharged, that circumstance will cause the plaintiff to lose the benefit of the plaintiff’s representation by the solicitors engaged by the plaintiff to that date. The District Court, as far as I am aware, does not have a practice Direction regarding what should be specified in an Anton Piller Order with respect to the supervising solicitor. The advantage of an independent solicitor if one had been present is that the independent solicitor’s role would have been to hold these documents pending any application for discharge of the order. If the order were discharged, then the independent solicitor, having no contact with the plaintiff, would merely return the property to the defendant. There would be no knowledge gained by the plaintiff’s solicitor regarding the defendant’s documents. However, in this instance the plaintiff’s solicitor being the supervising solicitor, has gained knowledge of the contents of the defendant’s documents and this has led to the drawing of the further amended Statement of Claim. In my opinion, that document suffers from the disadvantage that there is an assertion that names and dates have been obtained from the defendant’s documents and these documents must in the course of the action, be disclosed. However, for the reasons I have given, I do not accept that is so. The circumstances in this matter are compounded as the plaintiff’s solicitor has this claimed knowledge. As the Anton Piller Order has been discharged, the plaintiff should not gain any advantage from the order unless I am persuaded by the plaintiff there are good reasons to allow the plaintiff to retain any advantage gained from the order. In my opinion, as the order was discharged, it is unfair to the defendant to have to accept the plaintiff’s claim that the documents the plaintiff’s solicitors have had access to as a result of the execution of the order must be disclosed in due course in the proceedings. This is a claim made because the plaintiff’s solicitor was the supervising solicitor. That is a claim I am only prepared to accept is an assertion. I am not persuaded therefore by the plaintiff that there are good reasons to allow the plaintiff to retain any advantage gained from the order.
I am mindful of the obligation upon the court to ensure that the proceedings are dealt with without delay and at the minimum cost to the parties including the plaintiff. However, I am not persuaded there are good reasons to allow the plaintiff to retain an advantage gained from the order.
I summarise my reasons:-
(a) The order has been discharged at an early stage in the proceedings;
(b) The relief proposed to be sought by the plaintiff has considerably reduced since the order was made and would have been unlikely to support an order of the kind made;
(c) The plaintiff is making, in my opinion, an assertion the documents its solicitors have had access to would be discoverable in the normal course of the action;
(d) These reasons are compounded by the nomination of the plaintiff’s solicitor as the supervising solicitor for the order, despite the judge’s preparedness to make the order.
For these reasons, the plaintiff has not persuaded me there are good reasons why the plaintiff should retain any advantage gained from the order. Therefore, in the exercise of my discretion I am not prepared to make the orders sought by the plaintiff in paragraphs 1, 2 and 3 of the plaintiff’s application. I order that the documents ordered by Judge Wylie Q.C. on 13 April 2000 to be sealed, be sealed until further order. I am prepared to make orders in the form sought by the defendant.
I hold, as did Judge Wylie Q.C. hold, that Mr. McCracken is bound by his undertaking. I would not make any order that had the effect of relieving him of that undertaking in the circumstances.
Subject to any refinement of the wording of orders, the orders I will make on this application are in terms of the orders set out in para. 1 of the letter from Minter Ellison to Hall Payne dated 31 May 2000.
I will also hear the parties regarding the question of costs.
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