Findlay v Grimmer [No 4]
[2015] WASC 438
•18 NOVEMBER 2015
FINDLAY -v- GRIMMER [No 4] [2015] WASC 438
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2015] WASC 438 | |
| Case No: | CIV:1128/2013 | ON THE PAPERS | |
| Coram: | KENNETH MARTIN J | 18/11/15 | |
| 33 | Judgment Part: | 1 of 1 | |
| Result: | Indemnity costs orders on first application Second application dismissed | ||
| B | |||
| PDF Version |
| Parties: | LAWRENCE JAMES HEAN FINDLAY BRIAN GRIMMER |
Catchwords: | Document subpoena to non-party Non-responsive answer by hard drive Overwhelming amounts of non-responsive and irrelevant documents provided electronically Inspection of hard drive begun by issuing party's solicitors Subpoena answer set aside as failure to comply with subpoena Proper answer ordered and subsequently provided by paper Costs wasted in inspection of hard drive before interruption Indemnity costs Turns on own facts |
Legislation: | Legal Profession Conduct Rules 2010 (WA), r 24 |
Case References: | Adams v Yindjibarndi Aboriginal Corporation RNTBC [2014] WASC 467 (S) Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Ltd [2013] HCA 46; (2013) 250 CLR 303 Findlay v Grimmer [2013] WASC 234 Knight v FP Special Assets Ltd [1992] HCA 28; (1992) 174 CLR 178 Sheikholeslami v Brungs [2006] FCA 933 Streeter v Western Areas Exploration Pty Ltd [No 2] [2011] WASCA 17 (S) Swansdale Pty Ltd v Whitcrest Pty Ltd [2010] WASCA 129 (S) Zaaiter v Perpetual Trustees Victoria Ltd [2010] NSWSC 512 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- (Consolidated by order dated 1 March 2013)
- Plaintiff
AND
BRIAN GRIMMER
Defendant
- Plaintiff
AND
BRIAN GRIMMER
Defendant
Catchwords:
Document subpoena to non-party - Non-responsive answer by hard drive - Overwhelming amounts of non-responsive and irrelevant documents provided electronically - Inspection of hard drive begun by issuing party's solicitors - Subpoena answer set aside as failure to comply with subpoena - Proper answer ordered and subsequently provided by paper - Costs wasted in inspection of hard drive before interruption - Indemnity costs - Turns on own facts
Legislation:
Legal Profession Conduct Rules 2010 (WA), r 24
Result:
Indemnity costs orders on first application
Second application dismissed
Category: B
Representation:
CIV 1128 of 2013
(Consolidated by order dated 1 March 2013)
Counsel:
Plaintiff : No appearance
Defendant : No appearance
Non-party : No appearance
Solicitors:
Plaintiff : Bennett & Co
Defendant : Gilchrist Connell
Non-party : Vogt Graham Lawyers
CIV 1314 of 2013
Counsel:
Plaintiff : No appearance
Defendant : No appearance
Solicitors:
Plaintiff : Bennett & Co
Defendant : Gilchrist Connell
Case(s) referred to in judgment(s):
Adams v Yindjibarndi Aboriginal Corporation RNTBC [2014] WASC 467 (S)
Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Ltd [2013] HCA 46; (2013) 250 CLR 303
Findlay v Grimmer [2013] WASC 234
Knight v FP Special Assets Ltd [1992] HCA 28; (1992) 174 CLR 178
Sheikholeslami v Brungs [2006] FCA 933
Streeter v Western Areas Exploration Pty Ltd [No 2] [2011] WASCA 17 (S)
Swansdale Pty Ltd v Whitcrest Pty Ltd [2010] WASCA 129 (S)
Zaaiter v Perpetual Trustees Victoria Ltd [2010] NSWSC 512
1 KENNETH MARTIN J: I am dealing on the papers with two applications for costs. On the first application, the plaintiff, Mr Findlay, moves for non-party costs orders against Present Group Pty Ltd (Present Group). The level of costs sought from Present Group is on an indemnity basis as regards what Mr Findlay contends are his essentially wasted costs, which he seeks to claim back - arising out of the highly unsatisfactory answering of a document subpoena administered to Present Group, at the behest of the plaintiff, which involved the provision of a hard drive containing tens of thousands of documents. That happened in circumstances where an earlier subpoena to Present Group had been set aside on 3 May 2013 (as to the dimensions of that subpoena, see my first reasons for decision in Findlay v Grimmer [2013] WASC 234).
2 The second costs application arises essentially out of the same underlying facts. On the second application, the defendant, Mr Grimmer, applies for his costs against the plaintiff, arising out of the application which he brought, seeking to restrain any further inspection by Mr Findlay's solicitors of the hard drive, on the basis that materials on the hard drive which were the subject of his legal professional privilege were being accessed in circumstances where it was obvious that they had been provided in error (by Present Group) and that Mr Findlay's solicitor's ought to have realised that and under an applicable rule of professional conduct have stopped their inspection of the hard drive a lot sooner than had occurred.
The first Application for costs against Present Group
3 This non-party costs application is brought in circumstances which are truly extraordinary and hopefully never repeated.
4 In the end, I am satisfied it is appropriate for a non-party costs order to issue in the plaintiff's favour and that costs must be awarded against and paid by Present Group on the basis of the plaintiff's complete indemnification.
5 The plaintiff's application for non-party costs orders arises out of my decisions and (then) unpublished extempore reasons in March this year. Essentially, I concluded in March, within a framework of the urgent application brought by the defendant (Mr Grimmer) seeking to restrain the plaintiff from further accessing the documents provided to the plaintiff's solicitors by Present Group on a hard drive. Mr Grimmer sought consequential delivery up and destruction orders.
6 In the end, I issued orders in March this year for a return of the hard drive device to Present Group, under which it had purported to answer the subpoena it received from the plaintiff's solicitors. I ordered the return of any electronic copies made of the data contained on that hard drive. But I also ordered Present Group provide a proper response to the plaintiff's subpoena in circumstances where I assessed that the failure to answer the subpoena properly had led to the host of ensuing problems. Given the wholly derailed circumstances, I also indicated that a proper response would need to be given to the subpoena by Present Group, but this time by the medium of paper.
7 In short summary, Present Group's provision of a hard drive, containing 27 GB of data equating to roughly 260,000 documents, as a purported answer to the document subpoena, received at the instigation of Mr Findlay, represented what was a wholly unsatisfactory document 'dump' on the plaintiff's solicitors, by providing massive amounts of electronic data, under that electronic medium of response. Such a medium of response may have been in order had the massive amount of material been responsive or potentially relevant to what had been the requested documents. But that had proven, as inspection work unfolded, not to be the case.
8 Present Group had, in effect, delivered a 'haystack' of documents. The plaintiff, by his solicitors, had been necessarily forced to conduct a laborious evaluation of that 'dump' of electronic information to assess what had been provided.
9 By the time the urgent application (by the defendant, not the answering party) to restrain the process of ongoing inspection of the electronic data provided reached me, in March 2015, Mr Findlay's solicitors had not completely finished evaluating the whole content of the hard drive. They had ceased their evaluation work, pending the hearing of the urgent application brought by Mr Grimmer, voluntarily - after receiving objections to any further inspection articulated by the new solicitors for Mr Grimmer (not as an objection from Present Group, which provided the hard drive in the first place as the purported response to the document subpoena).
10 The new solicitors for Mr Grimmer had become alive to a potential problem, by a possible unintended disclosure of Mr Grimmer's confidential or privileged information by the Present Group which it was thought might adversely bear upon the interests of Mr Grimmer in this defamation action. Mr Grimmer's new solicitors had noted certain documents which had been newly identified and particularised under the recent amendments to the plaintiff's statement of claim in the defamation action. Alarm bells began to ring in that quarter.
11 Amended particulars pleaded by the plaintiff were seen to contain references to documents proposed to be relied upon by the plaintiff in the action, by way of being asserted to be aggravations to the plaintiff's damages - which he claimed to have suffered as a result of Mr Grimmer's alleged defamatory statements against him.
12 In effect then, Mr Grimmer's new solicitors, after noting the information emerging in the latest tranche of particularised amendments as to alleged aggravations of damages under the amended pleading, became concerned. They began to investigate what had occurred, including the Present Group's response to the subpoena. During that investigation they made some conferral enquiries with Mr Findlay's solicitors. This caused increasing concern.
13 All this ultimately culminated in the March 2015 urgent application of Mr Grimmer, seeking to restrain further evaluations of the hard drive electronic data - which then was still in the possession of the plaintiff's solicitors, but had not been completely evaluated. The work had ceased voluntarily, as I mentioned, pending the hearing of Mr Grimmer's restraint application. The question for me then was whether further inspections and evaluations of the hard drive data by the plaintiff's solicitors should be allowed to resume.
14 Mr Grimmer's new solicitors were contending that there had been an inadvertent disclosure by Present Group and that some of the documents provided, inspected and newly identified as amended particulars to Mr Findlay's aggravated damages, on their face remained the subject of Mr Grimmer's retained legal professional privilege.
15 This submission was advanced by Mr Grimmer on the asserted basis that identified documents disclosed legal advice given to him by his former legal advisers, Lavan Legal, and, further, that he had not, by his (apparent) providing of the materials to Present Group or otherwise, knowingly engaged in any act of conduct that might be thought to be a waiver of his privilege over such advice documents.
16 Thankfully, most residual legal professional privilege and waiver arguments over documents that the plaintiff obtained and seeks to rely upon against Mr Grimmer at the trial (arguments about which would have needed to have been determined by another judge) have been resolved consensually as between the parties. But the issue of who is to be responsible for wasted costs arising out of this mess remains.
17 In due course, it would appear Present Group eventually provided a further acceptable (paper-based) response to the document subpoena - subsequent to orders and directions I made in March 2015. This time the response appears to have been uncontroversial.
18 Inevitably, however, an issue as to the recouping of Mr Findlay's wasted legal costs arises at his instigation, against Present Group. This is said to be occasioned by reason of the always problematic 27 GB hard drive response by Present Group via provision of the hard drive, and the subsequent consequential wasted inspection time repercussions - associated with Mr Findlay's solicitors needing to conduct what has proven to be a needlessly costly and largely wasteful evaluation of a massive 'dump' of hard drive data material, up to the voluntary interruption of that process.
19 This has all led to the present application seeking non-party costs orders against Present Group which, after receiving the respective written submissions of each participant, I am to determine on the papers. It also leads to what I have foreshadowed as the second application for costs by Mr Grimmer against Mr Findlay.
20 I note, incidentally, that the trial of the action still awaits.
Non-party costs application for wasted subpoena response evaluation conducted by Mr Findlay's solicitors
21 Bearing in mind the specific and limited categories of documents requested under the subpoena leading to Present Group's hard drive response, particularly the limited temporal scope of the categories of documents requested under the subpoena to Present Group (predominantly couched as a request by reference to a two-month temporal period of focus for documents in the possession of Present Group, which met that parameter) it is still impossible for me to fathom how it could be thought that providing a 27 GB hard drive with roughly 260,000 documents would constitute a legitimate basis for providing a response in the electronic medium. Nothing has ever really emerged from Present Group to explain how this might have happened. Error in the magnitude of the response is, in effect, admitted but the error is not satisfactorily explained.
22 The decision of Present Group to respond to the subpoena by a hard drive response was, where it is now to be seen that things began to go haywire for it.
23 I can render no criticism of the plaintiff's solicitors for agreeing to accept, on an in-principle basis, a response to their subpoena under an electronic provision of documents. It was not for them to know before sight how many documents in the possession of the Present Group might possibly meet the descriptions of any of the four categories of requested documents, as the subpoena identified.
24 The plaintiff's solicitors were hardly to know before beginning to embark upon their examination of the electronic data (in the form provided to them) that most of the material provided electronically by Present Group would be unresponsive, irrelevant or inappropriate. Nevertheless, there was still some material found thought to assist the plaintiff's case. This material found its way into the amended particulars, which were openly published.
25 Given the hard drive response, there was always a certain amount of necessary exploratory wading to be done through the electronic 'haystack' as delivered by Present Group.
26 In conducting a reasonable evaluation of what might be found on the hard drive, the plaintiff's solicitors obviously did unearth a number of what they thought were 'needles' in that 'haystack'. Who knew what else they might find buried there as they proceeded. There was nothing covert about any of this from the plaintiff's solicitors. Some 'needles' to be relied upon were publicly identified - by being incorporated as documents particularised under the amendments made to the plaintiff's aggravated damages pleas under a statement of claim as amended by Mr Findlay. A number were mentioned in the list on an amended further list of plaintiff's discoverable documents.
27 The essential issue at the heart of the present non-party costs application is targeted at the correlative issue of allegedly wasted legal costs unnecessarily incurred in large part whilst inspecting voluminous amounts of irrelevant material in the hard drive.
28 With the benefit of hindsight, the plaintiff's solicitors essentially contend that they were forced to incur significant costs for their client by being unnecessarily forced to sift through massive amounts of (largely) useless and non-responsive data dumped on them electronically - in the period before Mr Grimmer's new solicitors eventually intervened, to object and assert Mr Grimmer's ongoing, unwaived legal professional privilege - based largely upon his feared disclosure of the legal advice provided to him about this action by his former lawyers.
29 Regrettably, a proper evaluation of the non-party costs application against Present Group (and indeed the second cost application by Mr Grimmer discussed later) requires me to revisit and to publish what will be an edited version of the unpublished reasons for decision I delivered extempore on 20 March 2015.
30 In evaluating the present costs applications, I have assessed that task as unavoidable, as a matter of gaining a proper appreciation of context and the underlying issues, returning all over again to bear upon the present non-party costs applications.
31 What will follow then, under the next section of these reasons, is an edited version of those 20 March 2015 reasons. After providing that context, I can then more readily proceed to evaluate the plaintiff's non-party costs application and the second costs application discussed after that. Even before any of that, however, a brief discussion of the law concerning costs awards is required.
Legal Principles: costs
32 There is no doubt the court holds ample power to issue a non-party costs order, even an order at the level of indemnity costs, should the underlying circumstances be ascertained as warranting that course.
33 As to the power to issue non-party costs orders, I refer generally to Knight v FP Special Assets Ltd [1992] HCA 28; (1992) 174 CLR 178, 185 (Mason CJ & Deane J, Gaudron J agreeing) and 202 - 203 (Dawson J). I mention as well the cases collected in my recent reasons in Adams v Yindjibarndi Aboriginal Corporation RNTBC [2014] WASC 467 (S) [34] - [43], and see Streeter v Western Areas Exploration Pty Ltd [No 2] [2011] WASCA 17 (S) [27] - [33].
34 Concerning a power to render such costs orders against entities not properly responding to a document subpoena, see Sheikholeslami v Brungs [2006] FCA 933 (where a costs order was made on a solicitor-client basis). In that case, the recipient of the subpoena request was a plaintiff who had defaulted in providing proper discovery. Indemnity costs orders issued effectively upon the assessment that the proceedings had amounted to an abuse of process. Principles applicable to the discretionary considerations evaluated and weighed by a court before issuing an order at a level of indemnity costs were discussed in Swansdale Pty Ltd v Whitcrest Pty Ltd [2010] WASCA 129 (S) [10].
35 Concerning circumstances where there had been a failure to comply with a subpoena issued to a party's former solicitor, costs orders were issued on an indemnity basis in Zaaiter v Perpetual Trustees Victoria Ltd [2010] NSWSC 512, see particularly [14].
36 From a jurisdictional perspective, therefore, there is more than ample power to issue an indemnity costs order against a non-party such as Present Group, were that to be otherwise assessed, ultimately, as being warranted.
37 The next section of these reasons provides an edited version of my reasons of 20 March 2015 on Mr Grimmer's application to restrain further inspection of the hard drive provided by Present Group to Mr Findlay's solicitors.
The 20 March 2015 Reasons (edited and revised)
38 I am confronted by a problem, from a case management perspective, of how to proceed, in circumstances where there has been an answer to a subpoena by the Present Group Pty Ltd (Present Group).
39 Present Group is 100% owned by, another company, Powertech Pty Ltd (Powertech). Both companies have Mr Brian Grimmer, the defendant, as their Managing Director. He is a very significant shareholder in Powertech, the ultimate holding company of Present Group.
40 The essence of the problem is as follows. Mr Nicholas Robert Stagg's affidavit, sworn 10 March 2015, contains two subpoenas to the Present Group. The first subpoena was set aside (see my reasons in Findlay v Grimmer[2013] WASC 234) on the basis of it being objectionable by reason of it being oppressive - that subpoena is NRS1 to Mr Stagg's affidavit.
41 Subsequently, there was a process of conferral between representatives of the parties. That happened at a time when the solicitors for Mr Grimmer were Lavan Legal. But Lavan Legal were also acting as the solicitors for Present Group, as recipients of the plaintiff's subpoenas.
42 A consequence of the conferral was that a second subpoena issued to Present Group, at the plaintiff's instigation, and in respect of which there had been the conferral between solicitors over the proper scope and categories of documents to be the subject of that second subpoena. That was the subpoena issued on 29 May 2013, found at page 15 of Mr Stagg's affidavit.
43 The significant categories of documents required to be produced under that replacement subpoena, under categories 2, 3, and 4, I repeat had been conferred about and settled, as between the plaintiff's solicitors and Present Group's solicitors (Lavan Legal). What is striking to me now, in examining the scope of that second subpoena, is that, as drawn, the number of documents asked for is explicitly confined as regards categories 2, 3, and 4, and from a temporal perspective, to a two-month window during 2012 (that is, the explicitly stated period as between 1 February 2012 to 31 March 2012). The other category 1 documents, as are asked for in the subpoena, seem also to be closely confined to the February or March 2012 temporal window.
44 Category 2 requests the production of emails to or from Mr Grimmer (the defendant in the action), which contain words (as identified in subpars (i) to (xiv) of that subpoena) by reference to their presence in the subject heading or the text of emails. An express two-month period, between 1 February to 31 March 2012, defines and confines this category of requested documents, as it does for the documents requested under categories 3 and 4.
45 Before I leave that point, I also note that the category 2 documents are directed at emails to or from Mr Grimmer, in that two-month period and containing the nominated words. Hence, Mr Grimmer's personal input in respect of answering that aspect of the subpoena's request about his own emails, albeit a request to the company (Present Group) of which he is Managing Director, would be expected.
46 As I mentioned, there unfolded, properly, a process of conferral as between the plaintiff's solicitors and the defendant's then solicitors, with the same solicitors also acting for the Present Group – upon the issue of the providing of an answer to this subpoena. Not unreasonably, there was a request made on behalf of Present Group that this subpoena be answered electronically, by reason of asserted efficiency considerations.
47 That proposal was agreed to by the plaintiff's solicitors. The resulting consequence, however, has effectively been catastrophic in terms of the administration of justice. What occurred was an answer by Present Group by way of a production of a hard drive containing a massive amount of data. As explained in Ms Justine Katherine Siavelis' affidavit, sworn 9 March 2015, par 53:
I have looked at the properties of the discovery.pst file and can say that there appears to be 27 GB of data in that file. There otherwise appears to be 600 GB of data in total on the Hard Drive.
48 That, on the face of it, is an extraordinary amount of documentary information.
49 Ms Siavelis also states at par 19(a), in terms of her own review of the hard drive, that there is a significant amount of irrelevant material. Emails related to other Powertech projects are included, which seem to have no possible connection to the request and the subject matter of these proceedings. By way of example, one folder contains an email attaching documents relating to a Sino Iron Project power plant.
50 There is agreement about the content of what has been provided on the hard drive by Present Group in answer to that subpoena request containing a 'large amount' of irrelevant material. Perhaps the term 'large amount' is a significant understatement. Attachment JKS14 to Ms Siavelis' affidavit is the Bennett + Co letter of 27 January 2015 in which it is asserted (see the last paragraph on page 102):
Mr Grimmer knew the subpoena had been issued and knew its terms, which were limited to emails between certain individuals containing words relating to the matters complained of in my client's statement of claim. Over 260,000 have been produced by Present Group in response to the subpoena. Most of those documents do not fall within its scope. Mr Grimmer, as a director, presumably had involvement in Present Group's compliance with the subpoena and in any event had (or had the opportunity to access and copy) the documents. The production of 260,000 documents, without any proper consideration as to relevance, appears to be an attempt to deluge my client with documents.
51 If I were dealing today with issues arising following a paper exchange by way of answer to a subpoena, and it was clear from that paper exchange that there had been an inadvertent disclosure by way of an unintended provision of legal advice to the defendant, particularly written legal advice given in 2013, which was well and truly outside the temporal scope of what had been requested on the subpoena, that would be one thing. One might then be in the territory of r 24 of the Legal Profession Conduct Rules 2010 (WA), which speaks of an inadvertent document disclosure.
52 That conduct rule places an obligation upon legal practitioners, where they know or reasonably suspect that documentary material which has been provided to them is privileged, and that the disclosure has been inadvertent, to not disclose the material, or use it in any material way and, as well, to notify the other practitioner's client and the practitioner of the inadvertent disclosure, among other things.
53 But I am not dealing here with any mere paper disclosure scenario. I am dealing with the provision of an object - a hard drive which of its very nature necessarily requires some level of analysis, in order to work out what actually resides somewhere within as the underlying electronic information, or data. Content in such a device is not demonstrable on its face. The content is to be determined, as one works through the hard drive, potentially by obtaining some technical expertise to assist that process. Then, as time goes by and a lot more scrutinisation work is done, eventually it may dawn upon the lawyers who are given this vast amount of electronic information to sift that there might be, from an irrelevance perspective, much material that is outside the two-month 2012 information window of February and March. The question is how one deals with that problem.
54 This problem comes to light about a year, in substantive terms, after the creating of the agreed terms for this replacement subpoena and after the provision of the hard drive by way of response. Something problematic from Mr Grimmer's perspective appears to have been noticed about then, because in a re-amended statement of claim of Mr Findlay filed on 24 October 2014, at page 53 (in what is a long pleading of 67 pages) one actually finds as particulars to par 46.9 (in a context of pleas about aggravation of damage) an email from Mr Grimmer to a Mr Michael Fisher with its subject line 'Re: The Psychopath's Modus Operandi' dated 28 January 2012.
55 The pleading by the plaintiff of that document started alarm bells ringing. There is then a partial analysis of what has been provided on the hard drive by the new solicitors acting for Mr Grimmer, albeit they do not act for the Present Group.
56 The new solicitors for Mr Grimmer now begin to realise that what has been provided under this electronic answer by Present Group seems, from a temporal perspective, to provide information well and truly outside the two-month requested period. Moreover, they now suspect the hard drive contained information that had passed between the defendant's former solicitors, Lavan Legal, in 2013, at or just before the time the defamation proceedings were foreshadowed under the plaintiff's concerns notice. This then led, effectively, by a process of deduction, to the defendant's new solicitors thinking that various privileged categories of documents in the hands of Mr Grimmer, had been inadvertently exchanged under the provision of the hard drive by Present Group - and which were still asserted to be the subject of Mr Grimmer's legal professional privilege.
57 By reference to the defendant's outline of submissions of 10 March 2015, the defendant asserts that the documents on the hard drive, as provided by Present Group, in purported compliance with the replacement subpoena, fall within four broad categories. Category A speaks of legal advice passing as between his former solicitors and Mr Grimmer or entities associated with Mr Grimmer (ie, such as Present Group or Powertech). However, the sheer magnitude of what has been provided allows those category deductions to be put into contest. For instance, I note from the opposing written submissions filed on behalf of Mr Findlay, as regards the challenge of his solicitors having received a tranche of material that were obviously the subject of Mr Grimmer's privilege, because they present as being legal advice to him, sees the plaintiff's solicitors respond at pars 14 and 15:
14. The plaintiff accepts the defendant's statement of principle, and also accepts that litigation against Present Group was reasonably contemplated in January 2013.
15. However, the plaintiff is unaware of any Subpoena Documents that fall within this category, although such emails may be embedded in emails between the defendant and the directors or staff of the Present Group (category C, as to which, see below).
58 Even Ms Siavelis' affidavit, speaking of the confronting task that she has faced in trying to come to grips with what is actually within the hard drive, indicates that, at best, an analysis of that gargantuan amount of material can only be relatively superficial. A solicitor assisting her, Mr Tozer, is referred to at par 55 of her affidavit. She relates concerning his efforts to come to grips with what is provided on the hard drive:
Mr Tozer has told me and I verily believe that he:
(a) spent approximately one and a half hours on the task of expanding all of the folders on the Hard Drive for the purpose of ascertaining the number of folders that were contained on the Hard Drive;
(b) needed to spend another 15 - 20 minutes to complete the task;
(c) anticipates it would have taken him another 3 to 4 hours to print out screenshots of all of the expanded files for the purposes of counting them; and
(d) estimates the number of folders contained on the Hard Drive to be in the thousands.
59 Ms Siavelis then says at par 57:
On the basis that it was not cost effective to complete the task, I asked Mr Tozer not to complete the count of the folders contained on the Hard Drive.
60 The not cost effective analysis is also exposed as the policy underlying an approach taken by Lavan Legal, as former solicitors for Mr Grimmer (see par 14 of Mr Stagg's affidavit). It is unclear if they still act for Present Group.
61 The plaintiff's submissions render it plain that they have, in the end, extracted some useful information from the electronic hard drive. But they have not completed a full analysis of what has been provided. Notwithstanding the magnitude of that task, Mr Bennett, as counsel for the plaintiff, says that the task of inspecting the hard drive was stopped 'as a matter of ethics'.
62 Where that all leads me to as a matter of principle is this: a subpoena is a command of the court to a party to produce documents for the assistance of the court and the parties in the litigation. Subpoenaed documents are therefore actually produced to the court. It is the court who controls the documents and allows the parties to have access to them on proper terms. But a subpoena must be properly answered. That has not happened here.
63 At the outset I will say that I do not criticise any of the parties, or even Present Group, in this case for agreeing to the concept of an electronic exchange answer to the plaintiff's subpoena. The plaintiff's solicitors did not really know what they were getting until it arrived and they began to examine the hard drive. They would have been justified in assuming, given the earlier conferral between the solicitors (after the setting aside of the previous subpoena) that what had been provided electronically would fall within temporal bounds (I am not addressing privilege issues yet) of a two-month identification window, the subject of categories 2, 3 and 4 of the subpoena, and the further information around that period for the category 1 documents.
64 Self-evidently, what has been provided by the Present Group is an overwhelming response. It is unworkable, unmanageable and, on my assessment, not a proper response to the subpoena request, as the command of the court. The question is how to deal with that. Present Group has been afforded an opportunity to participate today. Obviously, it is not here and is not participating. Nevertheless, the hard drive electronic document it has produced falls within the power of the court to control.
65 My view, at the end, is that the court must declare that the response provided by a production of that hard drive by Present Group is unsatisfactory. The hard drive provided should no longer be accessed by the plaintiff's solicitors any further. It should be returned. Beyond that, Present Group should be required, within a time period that I will hear Ms Siavelis upon, to properly answer the plaintiff's subpoena.
66 Moreover, I envisage a proper answer to the subpoena must now be given in orthodox fashion - by providing hard paper copies of documents within the two-month window.
67 To the extent that Present Group in answering the subpoena objects to inspection on the basis of legal professional privilege, either in its own right or on a basis of a common interest privilege shared with Mr Grimmer, that is for it to address on a proper response to the subpoena. Any such objections should be articulated by way of objection at the time the subpoena is properly answered.
68 Much of the controversy that has arisen as regards disputed materials today has arisen around documents circulating around 2013 - which plainly would not fall within the bounds of the February and March 2012 parameters of the subpoena request had the subpoena been properly answered. Moreover, it does not seem to me, as I look at the four subpoena categories, on the face of it, notwithstanding the number of people identified under category 3, to be a subpoena of a huge magnitude to answer in terms of the amount of potential material captured.
69 Moreover, if I may so say, Mr Grimmer needs to do some personal work to answer question 2 in his capacity as Managing Director of Present Group. The 16 people as identified under category 3 each need to do some work personally to answer the category 3 question, likewise for category 4. In the end, I cannot, for the life of me, comprehend how 27 GB or 260,000 documents have come to be assembled in terms of any sensible attempt to answer that subpoena.
70 There seems to be a high level of organisational dysfunction here, starting with the IT Manager of Present Group in his assembling all this material electronically. He is not, of course, a person legally qualified. Secondly, there was, it appears, no supervision at all of the Present Group's IT manager from Mr Grimmer. There was no input from Mr Grimmer, who would hold the best levels of knowledge as Managing Director of Present Group, about what to assemble. Thirdly, there was no supervising legal input over the response process to the subpoena request from any quarter. I see, effectively, that Mr Grimmer by his affidavit sworn 10 March 2015, looks to be 'pointing the finger' somewhat at Mr Stagg and perhaps impliedly making an assumption that what had been assembled by the IT manager would be checked (see par 27 of Mr Grimmer's affidavit). Mr Stagg, in his affidavit, indicates that he held no such instructions (see par 14 of Mr Stagg's affidavit). He made the assumption that the answer would be confined to the two-month window and, therefore, no privilege issues would arise. But consequently there was, in the end, no legal oversight of the whole process of providing this response.
71 In the end, everybody associated with the response by Present Group seems to be left looking at each other, rather than descending to actually do the grunt work that is required personally, in order to verify a proper response to that subpoena request.
72 I am conscious that I have made those remarks in the absence of Present Group today. Nevertheless, I note a close connection as between Present Group and the defendant, Mr Grimmer, as its Managing Director. It seems to me in all the circumstances, where it is the court that controls the material that is provided to it in answer to a subpoena and then allows parties, under the court's terms, to inspect, uplift or copy that material, that most of the problems I now have before me, arise from the fact that Present Group's answer to the subpoena is hopelessly inadequate and in the end, not a sufficient or proper answer.
73 I am minded, therefore, to order that there should be a proper answer by Present Group to that subpoena, within a fixed amount of time. The electronic hard drive should be returned and that hard drive document, if it has been copied, will all be returned to the court, by the plaintiff's solicitors. That will be phase A of unscrambling the 'omelette'.
74 The next question, though, is what is there to be done in terms of material that the plaintiff has to date accessed and which may prove to be problematic? In terms of specificity for resolving that issue, it may be that the 'omelette' is now incapable in the end of being unscrambled. There will need to be a determination at some point over discoverability and relevance, but also claims of legal professional privilege that are maintained by Mr Grimmer over any document that has been included in the amendment to the re-amended statement of claim of 24 October 2014, seen at page 53 of the current document as particulars to par 46.9. It is best that any required privilege evaluation analysis, if necessary, be conducted by a judge other than me, since I am the case manager and the putative trial judge.
75 Beyond that, in terms of evaluating what this plaintiff might have obtained in terms of specificity and which might be the subject of privilege claims, there are the listed documents, 75A to 75K, 78A and 78B, one of which appears to be around 7 November 2014 - which are referred to in a list of the plaintiff's documents, and which I have not otherwise viewed.
76 These might need to be, if the issue is pressed, the subject of a determination about their status, but elsewhere.
77 Otherwise, however, having now reviewed four affidavits and the parties' extensive written submissions, from a perspective of how I am going to manage a privilege issue vis-a-vis Mr Grimmer or, as I have termed it colloquially, the unscrambling of the omelette, there has not yet been to my satisfaction a sufficient identification of particular documents, in order for an analysis to be conducted by another judicial officer about where they stand from the perspective of: (a) relevance; (b) Mr Grimmer's privilege; and (c) waiver of that privilege by Mr Grimmer.
78 I do not find it to be satisfactory to inflict upon myself or upon anybody else on the court, the task of conceptually evaluating what might or might not be somewhere in circumstances where, in fact, the founding work has not been done, by reference to what is a gargantuan amount of material on a hard drive, to specifically nominate the concerned documents from a possible infringement of privilege perspective.
79 Let me also make this further observation. Documents that might have been obtained before the plaintiff's solicitors stopped accessing the hard drive have, to some extent, been identified in a pleading. A list of documents, quite properly identified as being discoverable, has led to questions about Mr Grimmer's privilege and whether the documents should actually be accessible or not. But in a pragmatic sense, if the plaintiff has obtained a document, bearing in mind he has also said he has not obtained any (legal) advice documents, then unless some document is thrown up which is shown to be in their possession that contradicts that position, there is no basis for a privilege challenge. What I am referring to here is the hypothetical and clear situation of, say, a document which displays on its face a scenario of the former solicitor writing to Mr Grimmer or the Present Group saying, 'Dear Mr Grimmer, we advise you' etc, or a counterpart communication such as Mr Grimmer contacting Mr Stagg and saying, 'Please advise me about this and this', or 'Please clarify your advice.' That sort of legal advice related material is obvious. But that is not this case, as I assess it today.
80 If that sort of obvious legal advice material had been obtained by the plaintiff's solicitors, I would have expected it to be, when unearthed within the haystack in which it was delivered, to be quarantined immediately and not read further.
81 But I do not possess any evidence to suggest that that type of situation has happened here. Something along those lines has obviously been of concern to the defendant's solicitors, from the perspective of Mr Grimmer and the protection of his legal advice, but the position is not obvious.
82 The onus, as I see it, now rests, given what has taken place, upon Mr Grimmer, if he wants to undertake his own further analysis of the hard drive and then seek to move for more specific relief, in terms of any particular documents being identified and made then the subject, in effect, of destruction orders, or orders to the effect that the trial be conducted on a basis that they do not exist, to do more than he has done to date.
83 If problematic documents do not show up on the plaintiff's lists of discovery - and I am only aware of the ones which the parties have identified as possibly problematic to date - then from a surprise perspective at the trial, I see it as almost impossible for any further non-listed document to emerge, or that could be allowed to be used in a cross-examination, or tacked onto a witness statement, if the document has not first been discovered and identified to the other side by the plaintiff before trial. If, as a result, any problem arising from a privilege or isolation perspective is identified, it can be dealt with specifically at that point. At present, the concerns expressed are simply too generally expressed and too hypothetical to deal with sensibly, beyond the orders I am about to issue concerning the return of the hard drive, destruction of any copies made and a proper response to the subpoena by Present Group.
84 That course may appease some of the immediate fears of the defendant's current solicitors over privileged document leakage concerning what else the plaintiff might or might not have accessed. A perfect solution is difficult, given what has happened.
85 But it seems to me that the root of the problem is ultimately one of the making of the Present Group, by reference to the three organisational dysfunction factors which I have identified. Just to reiterate: first, delegating the response to the subpoena task to an IT manager who was not legally qualified; second, no supervisory input provided from Mr Grimmer as Managing Director of the Present Group, he having delegated downward to others and particularly the IT manager; and third, no legal supervising input from a perspective of seeing whether the temporal constraints of what was agreed as between solicitors were observed in the response.
86 Those factors all seem to me to be the real cause of the present problems. Accordingly, the problem will be first addressed by declaring that the answer as currently provided by the Present Group to the subpoena does not, in fact, answer the subpoena to the satisfaction of the court. Accordingly, that hard drive, and any electronic copies made of it, must be returned. The court will thereafter, if necessary through a judicial officer other than me, sort out any specific residual privilege issues over properly identified documents, if such issues cannot be resolved by conferral, in terms of material that is contentious from that perspective. That will happen once the potential documents of concern have been properly identified and assembled by Mr Grimmer. That pre-requisite platform for the exercise has not been sufficiently accomplished yet.
87 I am not persuaded that enough has been provided, beyond what I have already talked about, in order to refer to another judge what would be only generalised and hypothetical arguments over what might or might not have been within various categories of document. That is the position as it stands now.
Residual non-party costs arguments: Evaluation of respective submissions of Mr Findlay and Present Group (resisting adverse costs order sought)
88 The previous section has provided the (now edited) reasons I delivered extempore on 20 March 2015, as revised.
89 With that foundation, I can return to Mr Findlay's present application for a non-party indemnity costs order against Present Group, arising out of that March 2015 outcome.
90 As mentioned, the present application is being determined on the papers, with the assistance of written submissions received from the solicitors for Mr Findlay and the solicitors for Present Group. To that end, I identify:
(a) the plaintiff's submissions in support of the application for indemnity costs orders against non-party of 30 July 2015;
(b) the outline of submissions of the respondent non-party (Present Group) opposing the application for indemnity costs orders made by the plaintiff, prepared by Vogt Graham Lawyers, of 10 August 2015; and
(c) the plaintiff's submissions in reply of 17 August 2015.
91 Without attempting any elaborate summary of what are now lengthy written costs submissions, in essence, Present Group strongly resists any costs orders as are sought against it by Mr Findlay (at any level, but particularly at the level of indemnity costs). By written submissions of 10 August 2015, Present Group seeks to raise, in resistance to any adverse costs orders against it, a number of issues, including significantly:
(a) that before making the orders sought the court first needs to determine whether there had been (presumably by Present Group) any inadvertent disclosure of confidential and privileged information such as to engage the applicability of r 24 (inadvertent disclosure) of the Legal Profession Conduct Rules (pars 11 - 13); and
(b) that there are wider policy implications extending beyond the underlying facts of this application, strongly tending against any making of non-party costs orders (particularly at the level of indemnity costs, pars 27 - 28).
92 The particular policy submission is made at par 32 in these terms:
32. Lawyers would be more likely to second-guess and try to make arguments that inadvertent disclosure had not happened. This is because of the comfort that a costs order against the disclosing party will eventuate anyway and that, therefore, perhaps there is a dispute to 'be had' over this and it is worthwhile taking to court.
93 It is further contended:
34. But, a party receiving a subpoenaed document that is non-compliant and basically unreadable/unusable, should take steps quickly to do something about the situation.
35. They should be encouraged to not let the matter lie for many months, but should instead satisfy themselves soon after taking possession of the document that it is compliant. This is especially so where they are privileged with the possession of the document temporarily, because it is otherwise a document the court has compelled into its possession.
36. No party handing over documents has an incentive to over-disclose so that they can then rely upon and enforce r 24.
- (c) a larger measure of fault and responsibility for any incurred waste sustained by the plaintiff, it is argued by Present Group, is attributable to the conduct of the plaintiff's own legal advisers – in failing to halt their scrutiny of the electronic data within the hard drive device provided by Present Group, a lot earlier than they eventually did. Present Group contends, in effect, that the plaintiff's solicitors ought to have appreciated far earlier than they did, if they ever did, that an inadvertent disclosure of (Mr Grimmer's) confidential or privileged legal advice material had occurred (see pars 14 - 26).
94 With one pragmatic qualification, I would reject all those arguments as misconceived, as I will explain below.
Evaluation and determination of non-party's resistance to non-party costs orders at an indemnity costs level
95 Concerning the argument that the court must first determine whether there had been an inadvertent disclosure for the purposes of conduct rule 24, this argument is, in effect, a rehash of an argument submitted but, in substance, rejected during the March 2015 hearing. I am, of course, well cognisant of the recent and important observations of the High Court in Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Ltd [2013] HCA 46; (2013) 250 CLR 303, particularly at [65] - [67].
96 But the answer to this submission is that the present underlying factual circumstances are comprehensively unique. Provision of a hard drive response by Present Group by way of response to the subpoena in principle may have been a pragmatic and justifiable medium of response. But the delivering of 27 GB of data and over 260,000 individual documents, by Present Group, in effect, dumped a 'haystack' of data - or, to use a modern vernacular, 'electronically stored information' - on the plaintiff's solicitors. Moreover, there was, as I saw it, nothing overt jumping out of the data to indicate a solicitor's letter of advice or something of that ilk, which had been mistakenly handed over. The evaluations required to that end were more subtle and even the issues of waiver, by reason of the documents concerning Mr Grimmer ending up with Present Group, would have to be weighed as well.
97 The massive level of provided electronic data necessarily required a reasonable level of analysis before any firm or reliable disclosure by inadvertence conclusions as regards privileged information could reasonably be drawn. Full responsibility for providing that unworkable medium of response, by incorporating a vast amount of non-responsive and irrelevant other material, must rest solely with Present Group. Nor is it appropriate for the court to be asked after that unhappy non-compliance event, to itself have to dive into the 'haystack' of electronic material in order to divine whether circumstances triggering the applicability of conduct rule 24 were engaged at some earlier temporal point than actually happened.
98 To the extent that the court has been offered some material in various affidavits provided upon this application, I remain of the view I held in March 2015, that there is no obvious legal advice document which has been identified to my satisfaction (see pages 7 - 8 of the transcript for the hearing of 20 March 2015).
99 In the circumstances, a submission that the court must embark upon for itself an analysis that neither the Present Group by its current legal advisers nor Mr Grimmer has yet fully undertaken, must be rejected, as wholly misconceived.
100 Concerning the so-called policy reasons advanced by Present Group against the making of non-party costs orders at the indemnification level sought, my assessment is that these arguments are also misplaced. In the first place, I consider the present case throws up unusual factual circumstances which are entirely atypical and, as I said earlier, hopefully will never be repeated. There has been here, as I indicated in the March 2015 reasons, the 'perfect storm' of organisational incompetence displayed under the circumstances surrounding the inadequate answering of this subpoena. For that, Present Group must bear full consequential responsibility. The only real issue is making a reasonable assessment about the levels of wasted scrutinisation time which Present Group has undoubtedly caused to be unnecessarily expended by Mr Findlay's solicitors, by reason of the gargantuan and overwhelmingly unhelpful and obfuscatory response it provided to the subpoena.
101 As regards the third tier of arguments, this sees Present Group seeking again, in effect, to shift responsibility from itself to the plaintiff and his legal advisers, for not earlier halting their scrutiny of the hard drive electronic data. There is, on my assessment, a measure of repetitive delusion about this contention. As I have indicated, the unsatisfactory response to the subpoena by delivering, in effect, a 'haystack' of material, much of which was non-responsive and irrelevant, lies squarely at the door of Present Group.
102 Lest it be suggested it escaped my attention, I record that I do not accept the submission of Present Group to the effect that because a few 'needles' were located by the plaintiff's solicitors within the 'haystack' of electronic data thereby the inspection exercise necessarily embarked upon was not, overall, to be assessed as wholly wasteful and pointless. The key reason I needed to set aside the response to the subpoena in March 2015 via the medium of the hard drive was that, on my assessment, it was not a proper response, bearing in mind the undue and oppressive (to everyone) levels of irrelevant and unresponsive data which had been encountered. Merely because the occasional relevant document was located within an otherwise vast and barren desert, does not deliver the conclusion that, overall, it was justifiable to cause the need for a great many wasted hours of searching, when that search process should never have been needed to be undertaken in the first place.
103 Present Group's response to the subpoena conduct, in my view, was wholly unreasonable and it fully warrants the sanction of the court, under a costs order fixed at the level of indemnification to Mr Findlay, in respect of all costs associated with a scrutinising exercise of the provided hard drive, which was necessarily but, in the overall circumstances, needlessly caused to be undertaken by Mr Findlay's solicitors concerning the provided hard drive.
104 There is one ancillary aspect of clarification which must accompany that conclusion. The usual form of an order for indemnity costs is issued upon the basis that the costs awarded are at a level of solicitor-client costs, save to the extent that those costs are assessed as being either unnecessarily or unreasonably incurred. For present circumstances, that formulation would potentially allow a taxing officer of this court to form their own assessment, if necessary, as to a temporal point at which the plaintiff's solicitor's unfolding evaluation of data within the hard drive, ought reasonably to have ceased, and to allow no further costs beyond that point. As things stand on the evidence before me, I hold and express no view as to whether the plaintiff's claim for wasted expenditure costs will amount to, say, hours, days, or even weeks of scrutiny of the hard drive.
105 Bearing in mind what limited number of documents were said to be usefully unearthed (for the plaintiff) throughout the course of that scrutiny, it may be for a taxing officer if necessary and appropriate on the evidence before that officer to render a determination as to whether the claimed number of reasonable hours of scrutinisation of the hard drive by Mr Findlay's lawyers was such that Mr Findlay's solicitors ought themselves, at some point, to have realised it was then unreasonable to continue any further scrutiny of the hard drive - bearing in mind the levels of irrelevant or non-responsive materials being encountered and also bearing in mind what was a two-month temporal subpoena identification criteria applicable to the categories of documents that were requested under the document subpoena in the first place.
106 Therefore, it will be open to a taxing officer, if thought appropriate based upon proper materials put before that officer, to form a view that after a fixed number of hours of scrutiny of the hard drive data, that a unilateral halt should reasonably have been called to the scrutinisation process by the plaintiff's solicitors. But I emphasise such a conclusion may not necessarily arise or be open. I am not in any position to render any such 'call a halt' determination, on the basis of the materials provided to me. A taxing officer may be, depending upon the level of the claim for hours of wasted scrutinisation, as may be submitted for claim in due course, on the part of Mr Findlay.
107 For all those reasons, I uphold the plaintiff's claim for a non-party indemnity costs order against Present Group .
108 Accordingly, as regards costs claimed by the plaintiff on this application, I shall order as from the publication of these reasons that Present Group pay all the plaintiff's costs arising out of their scrutiny of Present Group's response to the subpoena of 29 May 2013, save as to the extent that those costs are assessed by a taxing officer as having been unreasonably incurred, or are of an unreasonable amount. I would further order that the costs of this application, heard on the papers, be the plaintiff's costs against Present Group, to be taxed, if not agreed.
Second application: By Mr Grimmer for his costs (also determined on the papers)
109 I also need to deal with the undoubtedly related, but distinct, costs application, this time submitted by the defendant, Mr Grimmer, seeking his costs on an indemnity basis, alternatively on a party and party basis, against the plaintiff. This application also arises out of the fact that it was Mr Grimmer, in March 2015, who had applied to urgently restrain the plaintiff from further accessing and dealing with documents provided to Mr Findlay's solicitors by Present Group in answer to the document subpoena which Present Group had received.
110 I have now dealt above in these reasons with the indemnity costs exposure position of Present Group to Mr Findlay. Here, Mr Grimmer now pursues Mr Findlay for costs arising out of, essentially, the same events. The same considerations largely are seen to re-emerge, with a slightly different spin from Mr Grimmer's perspective.
111 As I have now observed, my 20 March 2015 decision setting aside the subpoena response of Present Group was an attempt at a pragmatic case management response to a diverse array of problems urgently presented to me in March 2015, as a result of a highly problematic, oppressive and non-responsive answer by Present Group to that subpoena.
112 As is seen from those reasons, I required Present Group (after affording it notice of the application) to provide a further (proper) response to the subpoena (by paper this time) and otherwise ordered a return of the hard drive via the court back to its source (plus the destruction of any copies made of that device).
113 I have concluded earlier in these reasons that it is appropriate that Present Group be ordered to meet, on an indemnity basis, towards Mr Findlay, all his wasted costs incurred as being associated with that wasteful, unnecessary and embarrassing exercise. In the circumstances, what, in effect, presents as a cross-application by Mr Grimmer for his costs presents as somewhat audacious. The application is not brought against Present Group as it might otherwise have been in concept, no doubt due to the close association between Mr Grimmer and that corporate entity. It is directed against Mr Findlay. As to that, I essentially repeat all of what I have now said above.
114 A residual problem thrown up during the evaluation of massive amounts of electronic data provided by Present Group's hard drive response related to the legal professional privilege arguments raised by Mr Grimmer, over a limited body of documents - which had been found effectively by Mr Findlay's solicitors as, in effect, 'needles' in the hard drive 'haystack', by the search and inspection labours of the plaintiff's solicitors, albeit those efforts had been interrupted and were not complete in March 2015.
115 The few limited documents found by Mr Findlay's solicitors were not ordered to be destroyed or returned. As I discussed above, in March 2015, I effectively issued programming directions, so that any residual legal professional privilege arguments arising as between the plaintiff and the defendant over those limited documents that Mr Findlay's solicitors had found and wished to rely upon (after conferral between their respective solicitors) could be heard (after an exchange of supporting affidavits and written submissions) by another judge. I did that so as not to impact against my neutrality as the putative trial judge, to determine the substantive trial of this defamation action - if it ever surmounts a seemingly unending array of interlocutory obstacles which have inhibited its progress to a final determination so far.
116 Six months on, the parties' solicitors, after their ongoing conferral, have essentially reached a compromise, as regards the disputed privilege issues over these documents proposed by the plaintiff to be relied upon and concerning Mr Grimmer's asserted legal professional privilege position.
117 In essence then, as of now, as I would assess it, without any binding concessions made by either side, the plaintiff has agreed that it will not contest the claims to privilege of Mr Grimmer over such documentation, save only for three documents still pressed: see pages 13 - 21 of the affidavit of Mr Alexander James Tharby, affirmed 4 September 2015. Essentially, all but those three documents will be quarantined for the future. That outcome presents as a seemingly sensible and pragmatic resolution of the privilege dispute concerning Mr Grimmer and the documents provided under the subpoena to Present Group.
118 Notwithstanding a welcome substantive resolution to most of the privilege controversy, a residual unresolved question over Mr Grimmer's claimed, but thoroughly disputed, legal costs of the March 2015 application now turns up to resolve. This is the application made by Mr Grimmer, now effectively seeking his legal costs which he contends were necessary for him to incur, by reason of his being effectively forced to bring a further inspection restraint application in March 2015.
119 The costs application of Mr Grimmer is strongly opposed by Mr Findlay.
120 To resolve the application of Mr Grimmer on the papers, as is sought, I have been provided with effectively two sets of written submissions by each side. Furthermore, I have been provided with or referred back to considerable affidavit materials filed at the height of the March 2015 clash.
121 From Mr Grimmer's perspective, as applicant on the application, I mention his founding written submissions of 27 August 2015, then his so-called submissions in reply, of 11 September 2015. I use the terminology 'so-called' since strong issue was taken by the plaintiff's solicitors, over whether those 11 September 2015 submissions were really in the true legal character of a reply - it being contended by Mr Findlay that they had manifested new arguments or referred to extra materials, ultimately leading to the plaintiff's expressed need to seek leave to file rejoinder written submissions of 14 September 2015, which leave I granted at a directions hearing on 24 September 2015.
122 Mr Grimmer relies upon three earlier affidavits on this application for costs. These are the affidavits of: Mr Brian Grimmer sworn 10 March 2015; his former solicitor, Mr Nicholas Robert Stagg, sworn 10 March 2015; and Ms Justine Katherine Siavelis, sworn 9 March 2015. All that now well traversed material was before me at the hearing of Mr Grimmer's restraint application heard during March 2015.
123 From the perspective of the plaintiff, in opposing the costs orders sought by Mr Grimmer, I first received his written submissions of 4 September 2015. They were accompanied by the affidavit of Alexander James Tharby, affirmed 4 September 2015. Mr Tharby assists as one of the plaintiff's solicitors in the conduct of this defamation action. It contains nine documentary attachments.
124 I also now have, as indicated, the plaintiff's written rejoinder submissions of 14 September 2015, taking issue over pars 3(a), 3(b), 3(c) and 3(d) of Mr Grimmer's reply submissions.
125 I do not propose to canvass those costs argument materials at any great length. The core arguments are not new.
126 The essential point is that as applicant/defendant, Mr Grimmer, by his submissions, contends that the plaintiff's solicitors have wrongly taken advantage, in effect, contrary to r 24 of the Legal Profession Conduct Rules, of an inadvertent disclosure by Present Group of Mr Grimmer's confidential and privileged documentary material, buried within Present Group's hard drive response to the subpoena but unearthed by the labours of Mr Findlay's solicitor's in evaluating the massive content of the hard drive provided by Present Group. I cannot accept that submission.
127 In effect, Mr Grimmer would seek to blame all but himself for what was the inadequate, wastefully oppressive and unhelpful response by Present Group to that subpoena. He would, nevertheless, contend that he was wronged and wholly justified in necessarily bringing his application in March 2015 to restrain any further accessing of the hard drive material by Mr Findlay's solicitors as well as its return and the destruction of all copies.
128 Mr Grimmer would seem to submit, as Present Group has unsuccessfully submitted before, that it should have been obvious to the plaintiff's solicitors much earlier that the two-month temporal range of the subpoena requests for documents was not being observed by Present Group under its electronic response, demonstrated by the encountering of vast amounts of, in effect, non-responsive documentary materials.
129 Furthermore, Mr Grimmer's contention seems to be that the legally privileged character (in Mr Grimmer) of some of the limited documentary materials unearthed by the plaintiff's solicitors (that came to be relied upon) was overt and demonstrable, such that they ought by that time to have recognised that there had been some mistake (presumably, mistake by Present Group in assembling the materials constituting its hard drive response).
130 In all those circumstances, Mr Grimmer says the plaintiff and his solicitors should properly have observed the established inadvertent documentary disclosure principles, as recently articulated by the High Court in Expense Reduction at [64] - [67] and then desisted voluntarily from any further inspection of the hard drive.
131 The Expense Reduction decision, of course, was about an unreasonable refusal to return documents, in a scenario of large scale discovery, as between the parties to that litigation, where the disclosure had been shown as plainly inadvertent. Notwithstanding claims of privilege when the disclosure error was realised, the opposing firm of solicitors had then unreasonably refused to return the documents.
132 The present underlying subpoena circumstances, by my assessment, are materially different to those manifesting in Expense Reduction.
133 Under his reply submissions Mr Grimmer, effectively, expands the challenges against the plaintiff (and his solicitors), contending not only for a breach of the professional conduct rules, but also contending as to a general unreasonableness in the overall conduct of the plaintiff's solicitors. To that end, he essentially asserts that the case management solution I ultimately fashioned in March 2015 (effectively ruling that the Present Group had provided an inadequate and unacceptable response to the plaintiff's subpoena and requiring Present Group to effectively start again to provide a proper response) was, effectively, a victory for him and was the pragmatic outcome he had been attempting to bring about consensually without success, before being forced, in effect, to apply to restrain all further access to the hard drive documents (see par 4 of his 11 September submissions). I disagree with that self-anointed 'victory' assessment.
Determination as to Mr Grimmer's claim for costs
134 By my assessment, there is no basis for Mr Grimmer to legitimately seek any award of costs against the plaintiff, based upon the conduct of Mr Findlay or his solicitors, over their inspections and dealings with the hard drive that was provided to them by Present Group - in answer to the subpoena Present Group had received from the plaintiff.
135 I reach that view for, in essence, the following reasons. First, it is correct, as the plaintiff's solicitors submit in their submissions, that I did not ever conclude that there had been any infringement of the professional conduct rules by the plaintiff's solicitors, as regards their seeking to take advantage of an inadvertent documentary disclosure - on a basis that Mr Findlay's solicitors ought to have recognised at an earlier time an underlying disclosure error, then voluntarily desisted and returned all information (to Mr Grimmer, who had not provided it in the first place). In cases of the inadvertent documentary disclosure of what is obviously confidential or legally professionally privileged material, principles as articulated in the Expense Reduction decision obviously apply. But here, the underlying factual situation was unusual, to say the least. The situation was far from being as clear as the facts underlying Expense Reduction. The situation here was not one of an obvious error over a disclosure of obviously privileged document(s), arising in the context of mutual discovery, between parties to litigation.
136 Here, the problematic documents had been provided by a non-party corporation, in answer to the document subpoena (albeit Present Group is recognised as a corporation closely tied to the defendant, Mr Grimmer). 137 Second, as is recognised, I did not find there had been any inadvertent disclosure. My orders of 4 March 2015 effectively implemented a pragmatic unravelling and disposition of an expensive, massive and potentially ongoing, problem. I did not uphold Mr Grimmer's application to order restraints in the terms he then sought. Rather, as an exercise in case management, I removed the source of the problem, which was the hard drive response to the subpoena by Present Group which could then be assessed as being in what were oppressive and wholly unworkable dimensions for everyone, including the court, at that time. My assessment of the 27 GB hard drive response by Present Group was that it was then posing ongoing and unnecessary difficulties for the defendant, the plaintiff and for the court.
138 Thirdly, from the court's perspective, Mr Grimmer's then argued limited inspection category resolution of his privilege application was not acceptable. It had a potential to consume an inordinate amount of resources wading through Present Group's hard drive subpoena response. Courtesy of what was, in effect, a 'document dump', no party had by then been really able to fully accomplish the task of reviewing the whole of the content of the hard drive. The plaintiff's solicitors had desisted in further evaluating material on the hard drive, at the request of Mr Grimmer's new solicitors, pending the restraint application being determined. But Mr Grimmer's solicitors had taken their time bringing to the court his application to restrain all further evaluation of the hard drive by the plaintiff's solicitors.
139 Fourthly, it is correct that there had been a failure upon the application of Mr Grimmer (seeking restraints) to precisely and fully identify materials the materials to be the subject of Mr Grimmer's claims of continuing and unwaived legal professional privilege, for the purpose of a thorough evaluative exercise asked of the court in that respect. That deficiency, as I saw it at the time, was again primarily attributable to the overwhelming amount of data which even Mr Grimmer's new solicitors were not then willing to fully sift and evaluate as opposed to sampling. The sheer expense of doing that would have been prohibitive, as was rightly recognised. Countless wasteful hours may have been consumed in that process. Even so, the broad evaluative approach to the advocated privileged document categories which was then being urged upon the court at the time by Mr Grimmer's solicitors was, I assessed then, unworkable and unacceptable. (See pars 15 - 29 of the defendant's written submissions of 10 March 2015.)
140 Fifthly, from the perspective of the plaintiff's solicitors, they had halted their incomplete evaluation of the hard drive at the request of the defendant's solicitors pending the application being heard. But it was clear that they had by then unearthed some limited few documents which Mr Findlay proposed to rely upon at the trial against Mr Grimmer. They effectively made that adverse reliance stance crystal clear to the defendant and to his solicitors by expressly identifying them as amended pleaded particulars of the documents, referred to under the category of aggravation damages, in the plaintiff's amended statement of claim. In short, I reject the proposition that there was any illegitimate exercise by stealth to achieve any illegitimate advantage here to capitalise on an inadvertent disclosure of privileged advice by Mr Findlay or by his solicitors.
141 Sixthly, Mr Grimmer had significantly contributed to the presenting documentary mess of March 2015. I indicated at the time that his lack of supervisory involvement towards the assembly and delivery of the subpoenaed documents process had been a factor leading to Present Group wrongly providing the vast amount of unresponsive and unnecessary electronic material under Present Group's unsatisfactory response to that subpoena.
Adverse determination on Mr Grimmer's costs application
142 I have not and do not reach any conclusion that there had been any prima facie breach of the conduct rules by the plaintiff's solicitors, in the face of an inadvertent disclosure of documents that were demonstrably privileged. Furthermore, in what I have observed to be extraordinary and hopefully never to be repeated circumstances, I am not able to say that the plaintiff's solicitors acted unreasonably, under their responses to Mr Grimmer's new solicitors, after a problem had finally been identified in the response of Present Group. There was a cessation in terms of further inspection of the material on the hard drive, on a voluntary basis. But it was never clear or obvious, on my assessment, that the small levels of potentially helpful documentary material as were being unearthed by the plaintiff's solicitors were obviously the subject of Mr Grimmer's ongoing legal professional privilege. That was not at all clear.
143 But even if such a characterisation as advice might have been suspected, the emanation of this material not from Mr Grimmer but from the possession Present Group carried with it some live and difficult extra considerations over whether or not any such privilege as might once have subsisted in Mr Grimmer had, by then, effectively become the subject of an inconsistent dealing by its provision and revelation to Present Group - so as to raise as live a possible application of the doctrine of waiver in respect of materials once, but no longer, privileged. Fortunately, these are not, by reason of the limited accord reached, the difficult evaluations a judicial officer will have to make.
144 But such difficult privilege assessments also should not be glossed over and de facto assumed as being in Mr Grimmer's favour, at a removed distance of being bundled up in Mr Grimmer's costs application. Those difficult privilege evaluation and waiver questions vis-a-vis the provided documents and Mr Grimmer's position remain undetermined.
145 In all the circumstances, particularly where Mr Grimmer has contributed significantly to the end problem, by his lack of supervisory input towards Present Group's subpoena response, it presents to me as rather 'brave' of Mr Grimmer to even advance his present application for costs, let alone to seek indemnity costs, against the plaintiff.
146 I am ultimately unmoved by the application of Mr Grimmer, which will be dismissed as meritless, upon the publication of these reasons. The taxed costs of Mr Findlay associated with his resisting of this costs application brought against him, and which has now been determined adversely to Mr Grimmer on the papers, shall also be borne by Mr Grimmer.
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