Darling Point Pty Ltd v Delairco Industries Pty Ltd

[1985] FCA 463

Re: DARLING POINT PTY. LTD.
And: DELAIRCO INDUSTRIES PTY. LTD.
No. WA G5 of 1984
Practice and Procedure

COURT

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
Toohey J.

CATCHWORDS

Practice and Procedure - order that respondent file and serve a further list of documents verified by affidavit - alleged failure to comply - motion to strike out defence and enter judgment - effect of inconsistencies in conduct of respondent in matters relating to discovery - appropriate order

Trade Practices Act 1974 s.52

Federal Court Rules

HEARING

PERTH
#DATE 16:9:1985

ORDER

1. The applicant's motion filed 22 July 1985 be adjourned to a date to be fixed.

2. The costs of the hearing on 10 September 1985 and any costs of attending to take this judgment be costs in the cause.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

On 27 August 1985 the Court ordered that, by 4 p.m. on Monday 2 September 1985, the respondent file and serve on the applicant's solicitors a further list of documents verified by affidavit to comply with an order made by the Court on 18 June 1985. The question now to be determined is whether the respondent has complied with that order.

1. The earlier history of this matter is contained in my reasons for judgment delivered at the time the order of 27 August was made. I shall not repeat anything said there except to the extent that it is necessary for an understanding of the orders now to be made.

2. In these proceedings the applicant claims damages against the respondent arising from the purchase of a Crossfield Magnascan 540 quadracolor large format scanner and ancillary equipment ("the Magnascan"). The claim is based on s.52 of the Trade Practices Act 1974 and includes a claim in negligence arising from an alleged duty of care on the part of the respondent in regard to the installation of the Magnascan.

3. The order of 18 June required discovery of four categories of documents. The categories were formulated in the order in the following terms:
   
   

" SCHEDULE

In relation to all Magnascan 530 and 540 machines installed and operating in Australia and New Zealand between 1 January 1982 and 1 March 1983 ("the period"):

(1) service reports prepared by the respondent's engineers documenting, inter alia, faults experienced and the corrective action taken in relation to the above for the period;

(2) correspondence between the respondent and Crossfield Electronics Ltd, the manufacturer of the Magnascan 530 and 540 in relation to the above for the period;

(3) letters from the users of the Magnascan 530 or 540 to the respondent in relation to the above for the period;

(4) documents or records maintained by the respondent showing complaints from users of the Magnascan 530 or 540 in relation to the above for the period."

1. The applicant does not claim that the respondent's discovery has been inadequate so far as it relates directly to the Magnascan the subject of these proceedings. But it contends that the respondent has failed to discover documents relating to other Magnascans, as identified in the schedule, and that this discovery is important for the proper presentation of the applicant's case, particularly in regard to the claim in negligence. Subsequent to the order of 27 August the respondent filed a further list of documents, accompanied by an affidavit sworn 30 August 1985 by its sales director Robert Henry Purssell relating to enquiries made by the respondent to locate documents and explaining why certain documents are no longer in the respondent's possession. On 10 September the respondent filed a further affidavit, this time sworn by its managing director Barry Ronald Miller. This affidavit was intended to answer allegations in an affidavit sworn by the applicant's managing director, Kevin Daniel McCarthy.

2. The matter was again before me on 10 September, counsel for the applicant contending that the order of 27 August had not been complied with and counsel for the respondent asserting that it had been. Counsel for the applicant filed a written submission in support of arguments that the respondent was still in default and that, given the history of this matter, its defence should be struck out and judgment entered for the applicant for damages to be assessed. I shall not deal expressly with each matter raised in the applicant's written submission as amplified by counsel in the course of the hearing. I have given these matters proper consideration but it seems to me that the resolution of this issue requires a somewhat broader approach in the light of the affidavits sworn recently on behalf of the respondent.

3. The order of 18 June required the respondent to state whether it had or had at any time in its possession, custody or power any of the documents specified in the schedule to the order and, in the case of documents no longer in its possession, to state when it parted with those documents and what had become of them. While the schedule identifies categories of documents, it should not be thought that these are mutually exclusive. It is almost inevitable that some documents will fall into more than one category. It is also necessary to bear in mind that in its further list of documents the respondent discovered 119 telexes between it and Crossfield Electronics Ltd., the manufacturer of Magnascans. The applicant's solicitors have not yet had inspection of those documents. It may be that some of the omissions of which it complains are in the documents available for inspection.

4. The affidavits of Mr. Purssell and Mr. Miller each asserts, based on enquiries of the respondent's officers, that the respondent has now given full and proper discovery. It would have been more satisfactory if the further list had dealt specifically with each category in the schedule, identifying documents presently in the respondent's possession and those no longer in its possession. But the following propositions may be drawn from the further list and affidavits.
   1. The respondent has no documents in its possession falling
   

within the first category. It has had such documents in its possession but those documents have been destroyed. Because they have been destroyed, the respondent cannot identify them with any precision. Nor can the respondent say with any certainty when they were destroyed except that it was in accordance with its standard procedure.

1. The respondent has documents in its possession falling within

the second category i.e. telexes to Crossfield and has made full discovery of those documents. The respondent once had in its possession the originals of the telexes it sent to Crossfield.

1. The respondent has in its possession one document falling

within the third category and that is document 120 in its further list of documents. There are no documents in this category that were once in the possession of the respondent.

1. As to the fourth category, the respondent has and has had no

documents in its possession relating to the period 1 January 1982 to 1 March 1983 except to the extent that a number of documents in the respondent's further list relate to installation problems encountered by the respondent in regard to Magnascans manufactured by Crossfield and sold by the respondent.

1. The applicant has pointed to the history of this matter, to the obviously inadequate discovery given by the respondent earlier and to inconsistencies in the lists of documents that have been furnished. There can be no quarrel with these criticisms of the respondent's conduct and these matters may well be the subject of cross-examination of the respondent's witnesses and of comment at the hearing of the application. But the question now to be decided is whether, after delay and prevarication (for which the respondent has been ordered to pay the applicant's costs, to be taxed and paid forthwith), the respondent has complied with the order of 18 June. In my view it has now complied in the sense that the respondent has sworn to the existence or non-existence of documents within each of the categories in the order. Mr. Purssell and Mr. Miller has each sworn, in unambiguous terms, that discovery is complete. Notwithstanding the respondent's unsatisfactory conduct in the matter of discovery, there is nothing in the material before the Court pointing to the likely existence of documents other than those discovered.

2. It is possible that, on inspection of the documents in the respondent's possession, the applicant may be able to point to omissions. Given the history of this matter as detailed in my reasons for judgment of 27 August, the applicant should not be deprived of the opportunity to present a further argument if that be the case. For that reason I do not propose to dismiss the applicant's motion seeking to have the respondent's defence struck out. The motion will be adjourned to a date to be fixed; I do not expect the matter to come before the Court again unless inspection of the respondent's documents justifies that course.

3. As to the costs of the hearing on 10 September and any costs of attending to take this judgment, I am of the opinion that they should be costs in the cause. The respondent may argue that it should have those costs because on this latest hearing the applicant has not persuaded the Court that the order of 18 June remains uncomplied with. But Mr. Miller's affidavit was not made available to the applicant's counsel until the morning of the hearing on 10 September. Furthermore the respondent's conduct in the matter of discovery made the hearing on 10 September a not unreasonable step on the part of the applicant. In all the circumstances, costs will be in the cause.