Courtney v Peters & Ors

[1990] FCA 526

JUDGMENT NO. 52k.3 %

IN THE FEDERAL COURT OF AUSTRALIA	)
1
VICTORIA DISTRICT ReGISTRY	No VG 173 of 1987
GENERAL DIVISION	1

BETWEEN: NATIONAL MUTUm HOLDINGS PTY

LTD: ACC HOLDINGS LTD: ACC
FINANCIAL MANAGEMENT LTD: ACC
LIFE LTD: ACC GENERAL INSURANCE

LTD: AUSTRALIAN CASUALTY CO LTD

(Applicants)

and :

-	THE SENTRY CORPORATION: PEAT MARWICK MITCHELL & CO fa firm1
(Respondents)
m:	THE SENTRY CORPORATION (Cross-Applicant)
and:	ACC HOLDINGS LTD: ACC FINANCIAL MANAGEMENT LTD: ACC LIFE LTD; ACC GENERAL INSURANCE LTD; AUSTRALIAN CASUALTY CO LTD: SENTRY ASSURANCE INTERNATIONAL LTD: PEAT MARWICK MITCHELL & CO fa firm): NATIONAL MUTUAL LIFE ASSOCIATION OF AUSTRAJXSIA LTD: STEPHEN JAOUES STONE JAMES
(Cross-Respondents)
AND :	PEAT MARWICK MITCHELL & CO (Cross-Applicant)
--	and	THE SENTRY CORPORATION: ANDREW THOMAS GREGORY: WILLIAM CllLRKE O'KANE: ACC HOLDINGS LTD: ACC
FINANCIAL MANAGEMENT LTD: ACC
LTD: NATIONAL MUTUAL CORPORATION PTY LTD: SENTRY ASSURANCE INTERNATIONAL LTDl

(Cross-Respondents)

AND :	SENTRY ASSURANCE INTERNATIONAL LTD
(Cross-Applicant)
and :	THE SENTRY CORPORATION: PEAT MARWICK MITCHELL & CO (a firm1
(Cross-Respondents)
(Cross-Applicants)
-	and :	PEAT MARWICK MITCHELL & CO fa
f  inn)
(Cross-Respondent)
m:	WILLIAM CLARKE O'KANE (Cross-Applicant)
-	and :	AMERICAN HOME ASSURANCE LTD (Cross-Respondent)

m: Ryan J.

Date: 18 September 1990

Place: Melbourne

EX TEMPORE REASONS FOR JUDGMENT

There remain for determination on this aspect of the interlocutory proceedings before this Court issues related to the provision of answers to interrogatories which have been raised first by a motion on notice taken out by the applicants to which I shall hereafter refer collectively as "National Mutual". That notice of motion is dated 21 August 1990 and by it National Mutual seeks orders for further answers to certain interrogatories administered for the examination of the first respondent, the Sentry Corporation ("Sentry"). Sentry objected in whole or in part to answering each of the interrogatories specified in the notice of motion.

It is convenient to deal separately and in order with each of the interrogatories to which it is said that Sentry should be compelled to provide a further answer. I shall then proceed to treat in the same way the answers to interrogatories which have been put in issue by another notice of motion dated 14 September

1990 which was taken out by the second respondent, Peat Marwick

Mitchell & CO ("Peat Marwick").

Interrocratorv 1

By this interrogatory National Mutual has inquired whether six named persons between 1 January and 2 October 1986 had or held:

"any t i t l e p o s i t i o n o r o f f l c e wlthin -

(a)	SIAMCO
[being Sentry Mutual Insurance Company, t h e parent company
of Sentry, which, I gather , t o be a corporat ion
incorporated i n t h e United S t a t e s of America]
(b)	Sentry
(c)	SAIL
[being Sentry Assurance In te rna t iona l Ltd]
(d )	SHL [being Sentry Holdings Ltd]; o r
(e)	t h e subsidiaries
[being four companies which conducted a s s u b s i d i a r i e s of
SHL i n Aus t ra l i a t h e insurance business which National
Mutual u l t ima te ly acquired pursuant t o t h e sale agreement
whlch has given rise t o t h i s l i t i g a t i o n ] ? "

The subsidiaries, as I understand the position, had been subsidiaries of SAIL and were acquired from it by SHL before the issued capital in SHL was on-sold by Sentry to National Mutual.

Sentry has objected to answering any part of Interrogatory 1 insofar as it concerns any period "occurring outside the period April 1986 to July 1986", or concerns the holding of any title, position or office within SIAMCO, SHL or the subsidiaries.

I do not regard those parts of Interrogatory 1 as, on their face, "vexatious or oppressive", so the essential question concerning them is whether they go to matters relevant to any issue raised by the pleadings. In my view, the pleadings do not raise any issue which makes the occupation of positions or offices within SIAMCO relevant in the sense that those positions can be the proper subject of interrogatories by National Mutual. However, I consider that SHL and the subsidiaries are in a

different case because of the allegations in paragraph 15 of	Sentry's cross-claim that certain representations were made or
joined in by SHL and the subsidiaries. I do not think that the period from 1 January to 2 October 1986 makes the presumptively unobjectional parts of Interrogatory 1 too wide. Accordingly, I order that Sentry provide a further answer to parts (d) and (e) of Interrogatory 1.
Interromatorv 2
Interrogatory 2 is dependent on Interrogatory 1 and I order a further answer to that interrogatory to the extent made necessary by the further answers which I have ordered to Interrogatory 1.
Interromatorv 3
By this interrogatory, National Mutual refers to a document dated 17 May 1985 under the letterhead "Sentry Insurance". The document is related to the SAIL organisation and contains a sub- heading "Holdinm Com~anv Res~onsibilities". The interrogatory asks :

"(1) is 'Sentry Insurance' an abbreviation for SIAMCO?

(2) if not to what entity does it refer?

(3) what company waa the 'holdlng company' referred to?"

Objection has been taken to answering any part of this
interrogatory. The objections which appear to me to have most

force are those going to relevance and that which contends that

the interrogatory inquires after the contents of a written

document. However, the latter objection is not available where

the interrogatory seeks explanation from extrinsic knowledge of the party interrogated of some abbreviation or other matter which does not appear from the face of the document itself. See e.g. Becker v Smith's NewsPaDer Ltd. [l9311 S.A.S.R. 1 as applied in Shar~e v Smail (1975) 49 A.L.J.R. 130. I also consider that the matters raised by Interrogatory 3 are relevant to the issue of whether Sentry can be said to have adopted representations made by SAIL. I shall order that Sentry provide a further answer to Interrogatory 3.

Interroaatorv 4

By this interrogatory National Mutual asks:

"In the period 1 January 1985 to 2 October 1986 did any officer, employee or agent of SIAMCO, Sentry or SAIL have any communication wlth any member, partner, offrcer or employee of PMM or PMM-US in relation to:

(1) the accounts;

(2) the sale or possible sale of the SHL Group or the SHL

Shares; or

( 3 ) the value of the SHL Group or the SHL Shares?"

Sentry has provided an answer to the effect that Sentry did not have any communication in relation to the value of the SHL Group or the SHL shares but has otherwise objected to answering this interrogatory. For the reasons already expressed in respect of Interrogatory 1, I consider that a similar answer should be provided in relation to any communication by SAIL and particulars of such communication should be given in any answer to Interrogatory 5 . Otherwise I uphold Sentry's objection to

answer this interrogatory.

Interroaatorv 6

This interrogatory refers to a memorandum under the letterhead "Sentry Insurance" from Mr Hoth to Mr Ballard and asks :

"(1) Who wrote this document?

(2) Give the usual conversation particulars of the discuasrone with O'Kane which are referred to therein.

(3) Did anyone and if so who on behalf of SIAMCO, Sentry or SAIL, instruct O'Kane to obtain from PMM an update on a current valuation for the Sentry group of companies?

(4) If yes to part 3 of this interrogatory, give the usual particulars of the mstruction.

(5) Did O'Kane obtain an update on a current valuation for the sentry group of companies from PMM?

(6) Did anyone and if so who on behalf of SIAMCO, Sentry or SAIL, have any communication m relation to any update on a current valuation for the Sentry group of companies with -

(a) anyone on behalf of PMM?

(b) anyone on behalf of PMM US?

in period 1 February to 30 April 19861

(7) If yes to any part of part 6 of this Interrogatory:

(a) give the usual particulars of the communications; and

(b) say whether the person concerned on behalf of SIAMCO, Sentry or SAIL told the other party to any such communication the purpose for which the update was being obta~ned."

An answer has been given to part (1) but objection has been taken to answering part (2). I uphold this objection as part (2) in effect asks whether certain parts of a written document are true; see Dunbar v Perc [l9561 V.L.R. 583, and amounts to cross- examination. An answer has been given to parts (3) and (6)

behalf of Sentry. For reasons already given, I consider that insofar as each inquires whether certain action was taken on parts (3) and (6) and, if necessary, parts (4) and (7), should

I -

also be answered insofar as they inquire of actions on behalf of	l : '
l
SAIL but not insofar as they ask of action on behalf of SIAMCO.	I '
I:
I consider that the answer given to part (5), which is confined	I ,
I _:
!
.-
to whether M r O'Kane obtained on behalf of Sentry an updated	L..
valuation, is evasive and a further answer should be given to part (5) of Interrogatory 6. Interroaatorv 7

This interrogatory inquires after a letter dated 8 November

1985 from SIAMCO to First National Ltd in Sydney which was an

actual or respective financier to SHL. I consider that the arguably relevant parts of this interrogatory amount to cross- examination on the contents of a written document and I decline to order a further answer to it.

Interroaatorv 8

This interrogatory inquires after a report furnished on 17 April 1986 by Peat Marwick to M r OrKane who was addressed as "Managing Director, Sentry House, 61 Lavender Street, MILSONS POINT NSW 2061". The interrogatory asks:

"(1) Did any and which person from SIAMCO, Sentry, or SAIL instruct O'Kane to request PMM to produce this document?

(2) If yes to part 1 of this interrogatory, give the usual particulars of the instruction.

(3) Did anyone and if so whom on behalf of SIAMCO, Sentry or SAIL receive a copy of this document prior to 22 July

1986. "

For reasons already given, I consider those inquiries to be

permissible in respect of SAIL but not SIAMCO and I order a
further answer to Interrogatory 8 accordingly.

Interroqatorv 9

I consider this interrogatory to be relevant insofar as it inquires of matters going to the likelihood of Sentry or any related or associated company conducting in Australia insurance business after the sale of the existing Australian operations were it not for the provisions of clause 12 of the Sale Agreement which has been invoked by paragraph 85 of the amended defence. I therefore order a further answer to the whole of the interrogatory.

Interroaatorv 10

This interrogatory inquires about matters contained in what appears to be an internal memorandum from Mr Hoth to Mr OnKane. I consider that it does more than seek clarification of abbreviations or ambiguities in the document. Rather, in my view, it amounts to cross-examination as to the truth of statements in the document or of matters arising from it in a

way regarded as impermissible in Dunbar v Perc (m).	I
therefore decline to order a further answer to Interrogatory 10.
Interroaatories 11 and 12

These interrogatories inquire respectively about a letter

from Peat Marwick addressed to Mr O'Kane as Managing Director of

SHL, and an internal memorandum to Mr O'Kane from a M r James.

The interrogatories have been answered in respect of

consideration of those documents on behalf of Sentry but they have otherwise been objected to. For reasons already indicated, I consider that answers should be provided in respect of consideration of those documents by or on behalf of SAIL but not by or on behalf of SIAMCO. I order further answers to Interrogatories 11 and 12 accordingly.

Interroaatorv 13

This interrogatory inquires about a document discovered by Sentry from a file kept by a Mr Ballard. It has been partly answered. I would order a further answer to part (1) to what I consider to be an unresponsive answer has been provided to a request for an explanation of a phrase "Sentry Insurance" which is apparently used by way of a shorthand expression. However, I uphold the objection taken to answering parts (9) to (11) inclusive.

- - -

Interroaatorv 14

This interrogatory inquires after a period from 1 January 1985 to 2 October 1986 which I consider to be too wide. An answer has been given, limited to the period from April to July 1986, in respect of communication by any officer or employee of Sentry in respect of the value of the SHL Group or the SHL shares. For reasons already given, I consider that a similar answer should be provided as to any officer or employee of SAIL

but not of SIAMCO.

The answers in respect of any officer or employee of SAIL should be expanded to deal in the period from April to July 1986 with the matters inquired after by parts (1) and (2) of this interrogatory and, to the extent rendered necessary by such further answers, an answer should be given to Interrogatory 15.

Interroaatorv 16

This interrogatory has been answered in part. I consider that proper objection has been taken to the remaining parts of the interrogatory which amount to cross-examination on matters arising out of the contents of a written document. I therefore decline to order any further answer to Interrogatory 16.

Interroaatorv 17

Sentry has objected to answer part (4) of this interrogatory on the ground that it is unintelligible. Even if

. . .

it were rendered intelligible in the manner suggested by M r Scerri of Counsel who appeared on behalf of National Mutual, I would decline to order a further answer as I consider part ( 4 ) ,

as so amended, amounts to cross-examination about the contents

of, or matter arising out of, a written document.

Interroaatorv 18

A sufficient response to this interrogatory has been provided on the face of the answer. A suspicion that the answer	to part (3) is factually inaccurate or insufficient is not a
ground for ordering a further answer. (See e.g. Lvell v Kennedy (1884) 27 Ch.D 1 at 16.) I therefore make no order for a further answer to Interrogatory 18.
Interroaatorv 19
For reasons already given, an answer should be provided to part (3) of this interrogatory. I uphold the objections to parts (41, (S), ( 6 1 , (81, (9) and (IQ), and parts (12) to (15) inclusive, as amounting to impermissible cross-examination about

the contents of a written document or matter arising therefrom.

Interroaatorv 20

This interrogatory inquires about a handwritten memorandum

apparently dated 2 June 1986. Answers have been given to parts

(1) to (7) but objection has been taken to parts (7) to (11)

which ask -

"(7) Does this document relate to a conversation between Ballard

and O'Kane? If so, give the usual conversation particulars
of the conversation.

(8) Did Ballard have any communication in relation to the 'right of 1st refusal' with any officer or employee of SIAMCO, Sentry or SAIL? If so give the usual conversation particulars of each such communication.

(9) In the statement 'Protect O'Kane and Sentry US', what company was Sentry US?

(10) Did Sentry, or O'Kane, propose that O'Kane be paid a

sliding scale commission for withdrawal of the right of

f ~ r s t refusal?

(11) Was a compromise reached? If so give the usual particulars

of the compromise."

I uphold the objection taken to those parts of that cross-examination about the contents of a written document and	interrogatory on the grounds that they amount to impermissible
infringe the principle laid down in Dunbar v Perc (supra) to which I have already referred.
Interroaatorv 21
This interrogatory requires reference to another handwritten document and asks:

"1.	Say whose handwriting appears on this document.
2.	I f t h i s document records a conversation between i ts author and O'Kane, g i v e t h e usual conversation p a r t i c u l a r s of t h e - -
same."

Part (1) has been answered. Part (2) has been objected to and I uphold the objection as similarly amounting to cross- examination about the contents of a written document.

Interroqatorv 22

This interrogatory refers to another handwritten document and, in effect, is in similar form to Interrogatory 21. For the reasons given in respect of the latter interrogatory, I decline to order a further answer to part (2) of Interrogatory 22.

Interroqatorv 23

This requires reference to a letter dated 7 July 1986 to one Gerard E. Veneman from Mr Ballard. The letter purports to emanate from "Sentry World Headquarters" and of it the interrogatory asks:

"(1) Was t h r s document s igned by Ballard?

( 2 ) Of which company was Ballard Chairman of t h e Board and

Chief Executive Of f i ce r as a t 7 J u l y 19867

(3)	To t h e board members of which company were copies of t h i s
document sen t?
( 4 )	Are t h e contents of t h e l e t t e r t r u e ?
(5)	Give t h e usua l p a r t i c u l a r s of t h e evaluat ions done on t h e
Aust ra l ian insurance opera t ions which a r e r e f e r r e d t o
there in .
( 6 )	Was t h e purchasrng company t h e same a s f o r t h e Hong Kong
operat ion?
(7 )	What w a s meant by 'National Mutual'?

Objection has been taken to answer parts (3) to (7) of that interrogatory. Since an admission has been obtained about the authorship of the document, I consider that the other matters raised by parts (3) to (7) of Interrogatory 23 are not proper subjects for interrogation buterather inquire after the truth of the contents of a written document and, accordingly, for reasons already given, I decline to order a further answer to that interrogatory.

Interroqatorv 24

This interrogatory requires reference to a lengthy typewritten document with a number of schedules which I take to be the sale agreement itself. An admission to that effect is made in answer to part (1) of the answer to this interrogatory. That admission made it unnecessary to answer part (2). An answer was given to part (3) but objection was taken to answering parts (5) to (10). I uphold those objections for reasons already given regarding those parts as amounting to cross-examination about

to part (11) and, although particulars of the transactions	the contents of a written document. An answer has been provided
described in leases referred to in that part of the answer have not been given, I decline to make any order for a further answer to Interrogatory 24.
Interroqatorv 25
This requires reference to a document which is a letter from M r Hoth to a "Mr. Warren Fisher 221 Spit Road Mosman N.S.W.
2088 Australia" dated 18 September 1986. Objection has been
taken to answering that interrogatory on a number of grounds. In my view the interrogatory inquires after matters which are made relevant by the issue to which I have already referred raised by paragraph 85 of the amended defence which goes to the likelihood of Sentry or any related or associated company carrying on insurance business in Australia were it not for the presence of clause 12 of the sale agreement.
However, I consider that parts ( 3 ) , (5), (6), (7) and (8) of that interrogatory have been the subject of valid objection for the reasons already indicated on the ground that they amount to cross-examination about the truth of, or otherwise go to the contents of, a written document. I therefore order a further answer only to parts (l), (2) and (4) of Interrogatory 25.
I turn now to the notice of motion by Peat Marwick seeking further answers to the interrogatories which that respondent had administered to National Mutual.
Peat Marwick Interroaatories 6 and 7
I consider that Interrogatory 6 has been adequately answered, having regard to the references which it contains to documents identified more fully in the definition or preface to the interrogatories themselves. I uphold the objection which has been taken to answering Interrogatory 7.
Peat Marwick Interroaatorv 12

"At any time prior to the entry on 22 July 1986 into the Sale

Agreement:

(1) Was any decision made by National Mutual not to communicate with the Auditors prior to the purchase of the Shares in respect of such purchase?"

An objection is taken to answering part (1) of that interrogatory "on the grounds that it is vague and oppressive" and it is then said: "Subject to that objection, the first applicant refers to and repeats its answers to interrogatory

10. "

.. . .

Interrogatory 10 asked: "Prior to the date of the entry into the Sale Agreement did anyone on behalf of National Mutual communicate with anyone on behalf of the Auditors about:" five specified matters. To each of those parts of that interrogatory the answer "No" was given. I understand the question in Interrogatory 12(1) to be whether a positive decision was taken by National Mutual not to communicate with the auditors prior to the entry into the sale agreement. I do not consider that the

question. Nor do I regard the question as so understood as being	answer given to Interrogatory 12 is properly responsive to that	"vague or oppressive". Accordingly, I order a further answer to Interrogatory 12.
Peat Marwick Interroqatorv 18
As explained by Mr Scerri for National Mutual, the answer to this interrogatory is somewhat elliptical and does not indicate clearly whether Messrs Mayers, Hoskins, Kent and Andrzejewski or any of them became aware of the valuation solely through some communication from Mr Hanning-Lee or learned of it from some other source. Accordingly, a further answer should be provided resolving that ambiguity and, in the event that some other source is indicated, giving particulars of the communication from that source.
Peat Marwick Interroaatorv 26
Parts (g) and (h) of this interrogatory require the deponent on behalf of National Mutual to:

"(g) say what belief each person who read annexure 'C' hereto at any time prior to 22 July 1986 formed as to the propriety, honeety or right (specifymg separately for each) of O'Kane to:

(i)   use his key role in the Australian operations as a lever;

(ii)  use a report by the Auditors which valued the Australian operation at 543 million

in the circumstances set out in paragraphs 1, 2, 3 and 4 of

annexure 'C';

(h)	say what information each person who read annexure 'c' hereto at any time prior to 22 July 1986 had as to whether and if so to what extent, O'Kane had informed and/or had any, and what, consent of the parent company referred to in paragraph 2 of annexure 'C' for the use of the report by	the Auditors referred to in paragraph 4 thereof? If such	~nforrnation was derived by each such person from a
communication or communications, provide the usual particulars in respect of each such communication;"

The answer given to those parts of that interrogatory were:

"(g) The first applicant ob~ects to answering this interrogatory

on the grounds that it is vague, oppressive and does not relate to any matter in issue in this proceeding. Subject to that objection, the first applicant says that each person who read annexure 'C' prior to 22 July 1986 was aware that O'Kane was proposing that an offer be made by a company in the National Mutual group in conjunction with O'Kane. Accordingly none of the persons concerned had, or had any reason to have, any reason to doubt the propriety, honesty or right of O'Kane to negotiate a price for the Shares using hie key role and the Peat Marwick valuation.

(h) It refers to and repeats rts answer to interrogatory 26(9)."

It has been pleaded that certain officers of National Mutual have aided and abetted a breach by M r O'Kane of s.229 of the Companies Code. In the light of that pleading I consider the question of belief to be relevant and I do not regard that it is an adequate response to an inquiry about such a belief to say that a person had no reason to doubt something. Accordingly, I order further answers to parts (g) and (h) of Interrogatory 26.

Part (j) of Interrogatory 26 asked the deponent to:

"look at the paragraph numbered 3 m annexure 'C' and say whether your company or any other company withan the National Mutual Group came to an arrangement or agreement with O'Kane by reason of which O'Kane was not a party to the Sale Agreement or did not exercise his right of first refusal as referred to in paragraph 2 of annexure 'C' and, if so, provlde the usual particulars with respect to that arrangement or agreement and the communicatrons pursuant to which it was made."

The answer given to that part of Interrogatory 26 is simply
"No". Since, as I have already indicated, it is not open to the

Court on a motion like the present to investigate the

sufficiency in fact or the truth of an answer to an

interrogatory, I read the words beginning "by reason of which

O'Kane" as being descriptive of the arrangement or agreement inquired after by that part of the interrogatory. If there be a deficiency it is in the interrogatory itself and not in the answer. Accordingly, I decline to order a'further answer to part

(j) -

Peat Marwick Interroqatorv 27

Mr Scerri on behalf of National Mutual has offered to

provide a further and better answer to this interrogatory and it
is therefore not necessary to deal further with it.

Peat Marwick Interroqatorv 29

It has been conceded, again by Mr Scerri, that a further answer should be provided to part (c) of this interrogatory by way of identifying with greater particularity the substance of the discussions inquired after. A further answer is sought to part (d) of Interrogatory 29 to which the deponent had merely said "not applicable". I find that phrase not meaningful in the context and I order a further answer to that part as well.

Peat Marwick Interroqatorv 32

National Mutual, to part (i) of this interrogatory,
provided an answer in respect of Messrs Hoskins and Strong by
reciting a belief "that the accounts were discussed with Sentry

Sale Agreement. It is unable to say who said what.". in Wisconsin in relation to the tax indemnity provision in the

In my view the criticism has validly been made on behalf of Peat Marwick that an inability to attribute parts of a conversation to an identifiable participant in it does not excuse a party interrogated from providing the substance of the conversation where that party is able to do so. Accordingly, I order a further answer to part (i) of Interrogatory 32.

Peat Marwick Interroaatorv 34

Parts (d) and (e) inquired after a handwritten document headed "Value of Portfolio", and asked:

"(d) did your company or anyone on ~ t s behalf take the contents

of the document or any of them into account in relatlon to any declsion to purchase the Shares or to make any offer for the purchase of the Shares?

(e)	if the answer to (d) is in the affirmative,
(i) provide the usual particulars in relation to any

communicat~on relating to the contents of the document

being so taken into account;

(ii)  to the extent that the contents of the document were so taken into account otherwise than by way of communication, specify precisely who took them into account, when and how they were taken into account, and any act or decision of your company or of anyone on its behalf which was done or taken so to take account of the document."

The answer given to those parts of that inter~ogatory were:

"(d) The first applicant objects to answering this Interrogatory on the ground that it is vague and oppressive. Subject to that objection, the first applicant says that Andrzejewski read the document.

(e) Not applicable."

In my view, it is not "vague and oppressive" to ask whether

a particular document was taken into account in the making of a

decision to purchase, or to make an offer to purchase shares,

and it is an unresponsive answer to an interrogatory in the form

in which Interrogatory 34(d) has been administered to say merely that a named individual had read a document. That does not disclose whether the individual took the document into account, or merely read it and disregarded it. Accordingly, I order further answers to parts (d) and (e) of Interrogatory 34.

Peat Marwick Interroaatorv 37

"What a r e a l l t h e s t e p s your company has taken f o r t h e purpose o r having t h e e f f e c t of mi t iga t ing its l o s s which it claims i n t h e s e

proceed~ngs , s e t t i n g out t h e da te , na tu re of t h e s t e p involved

( inc luding any usual p a r t i c u l a r s ) , and t h e amount of t h e l o s s o r

saving t o your company which	r e s u l t e d from t h e taking of	such
s t eps?"
The answer has been given:

"The p r i n c i p a l l o s s claimed by t h e f i r s t appl icant agains t PMM i s

t h e d i f fe rence between t h e cons idera t ion paid f o r t h e Shares and

t h e value of t h e Shares on 22 J u l y 1986. This l o s s c r y s t a l l i s e d

on 22 J u l y 1986.	Such l o s s was no t and i s not capable of
mi t iga t ion . "

The criticism has been made on behalf of Peat Marwick that the answer in that form does not amount unequivocally to an admission that no step has been taken to mitigate the loss referred to. I agree that if the answer is intended to convey such an admission it should do so unequivocally. It is also clear that the answer does not deal with losses which have been claimed in the particulars provided of the statement of claim, other than the loss described in the answer as "the principal loss". It may be that this interrogatory is in whole or in part

objectionable, but no objection has been taken to it. In the circumstances I order a further and better answer to Interrogatory 37.

The Court Orders:

1.  That Sentry on or before 9 October 1990 file and serve further and better answers to interrogatories numbered 1, 2, 3, 4, 5, 6, 8, 9, 11, 12, 13, 14, 15, 19 and 25 administered for its examination on behalf of National Mutual.

1. That National Mutual on or before 9 October 1990 file and serve further and better answers to interrogatories numbered 12, 18, 26, 29, 32, 34 and 37 administered for its examination on behalf of Peat Marwick.

3.   That each of National Mutual and Sentry bear its own costs of and incidental to National Mutual's motion on notice dated 21 August 1990.

4.   That National Mutual pay Peat Marwick's taxed costs of and incidental to Peat Marwick's motion on notice dated -17 September 1990.

5.    That liberty be reserved to each of National Mutual, Sentry and Peat Marwick to apply to Ryan J. on not less than 48 hours notice in writing to any other party affected by such application for such further or other directions as it may be advised in respect of these orders or the further and

better answers provided in accordance with paragraphs (1) or (2) hereof. I certify that this and the preceding

twenty-one (21) pages are a true copy of the Reasons for Judgment of His Honour Mr Justice Ryan.

Date:  (8 S q g h d R c /990 ,

Counsel for Applicants:	Mr P.R. Hayes, QC
and M r C.M.  Scerri
Solicitors for Applicants:	Mallesons Stephen Jaques
Counsel for Respondents:	D. Ryan
Solicitors for First Respondent:	Messrs Phillips Fox

Solicitors for Second Respondent: Allen Allen & Hemsley

Date of Hearing:	17 and 18 September 1990
Date of Judgment:	18 September 1990