Hall v Hall

[2023] NSWSC 1230

Supreme Court

New South Wales

Medium Neutral Citation:

Hall v Hall [2023] NSWSC 1230

Hearing dates:

11 October 2023

Date of orders:

11 October 2023

Decision date:

11 October 2023

Jurisdiction:

Equity - Applications List

Before:

Kunc J

Decision:

Registrar’s decision set aside

Catchwords:

CIVIL PROCEDURE — Notices to produce — Before hearing — Solicitor expressly states that she informed herself from her file for purposes of swearing affidavit — Whether whole file liable to production — Whether implied waiver of client legal privilege

Legislation Cited:

Civil Procedure Act 2005 (NSW)

Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:

Ampolex Ltd v Perpetual Trustee Co (Canberra) Ltd (1996) 40 NSWLR 12

GR Capital Group Pty Ltd v Xinfeng Australia International Investment Pty Ltd [2020] NSWCA 266

Hastie Group Limited (in liq) v Moore (2016) 339 ALR 635; [2016] NSWCA 305

Category:

Procedural rulings

Parties:

David Gareth Hall (Plaintiff)
Kimber John Hall (Defendant)

Representation:

Counsel:
R Francois/H Robinson (Plaintiff)
J Brown/R Size (Defendant)
Solicitors:
Brown Wright Stein (Plaintiff)
Turnbull Hill Lawyers (Defendant)

File Number(s):

2022/143444

Publication restriction:

Nil

EX TEMPORE JUDGMENT (REVISED)

Summary

1. This is a motion for review of a decision of a registrar which, in effect, upheld a notice to produce for inspection issued by the defendant to the plaintiff. The plaintiff (the applicant on the motion for review) was represented Ms R Francois of Counsel with Ms H Robinson of Counsel. Mr J Brown of Counsel appeared with Mr R Size of Counsel for the defendant.

2. The plaintiff and defendant are brothers. By his will, their late father, Marshall John Hall, established the MJ Hall Testamentary Trust (the Trust). The defendant is the trustee of the Trust. In these proceedings, the plaintiff seeks the removal of his brother as trustee, to be replaced by two independent trustees. The plaintiff's solicitor is Ms Snezana Vojvodic, a partner in Brown Wright Stein Lawyers.

3. The plaintiff's case in chief is sought to be established by reference to the defendant’s conduct as trustee, which is said to be evidenced by correspondence between the parties and their respective solicitors. That is not an uncommon course in cases such as this.

4. On 17 May 2022, Ms Vojvodic swore an affidavit (the First Affidavit) attaching the correspondence to be relied upon by the plaintiff and which included:

“2. This affidavit is based on my own knowledge of the facts and information available to me, from my review of the file in relation to this matter and information provided to me by the Plaintiff.”

5. The defendant contends that for the purpose of "testing" Ms Vojvodic's evidence, paragraph 2 of the First Affidavit and the fact that the plaintiff seeks to prove his case through Ms Vojvodic's affidavit gives rise to an entitlement as a matter of procedural fairness to access to the file to which she refers (I shall refer to it as the File). It is also said that paragraph 2 impliedly waives client legal privilege over anything in the File which might otherwise be subject to that privilege.

6. The defendant sought to make good this alleged entitlement by issuing a notice to produce for the File and then a motion for compliance with that notice. After a contested hearing, the registrar ordered that the plaintiff should comply with the notice to produce. The plaintiff has sought a review of that decision.

7. For the reasons which follow, the Court will set aside the learned registrar's orders. However, consistent with the overriding purpose, the Court will order production of a more refined category of documents to which it is satisfied (and the plaintiff does not dispute) the defendant is entitled.

Matters of agreement

8. There were three matters of agreement on the review:

1. There was no dispute that the File was a “document or thing that is referred to in … any affidavit … filed or served” by a party for the purposes of Uniform Civil Procedure Rules 2005 (NSW) (UCPR) Part 21, r 21.10(1) and was therefore susceptible to a notice to produce for inspection under that rule.

2. Insofar as client legal privilege is concerned, there was no different result whether the Court applied common law or statutory principles of evidence.

3. The legal principles applicable to the review.

The Proceedings

9. The proceedings were originally commenced by summons filed on 18 May 2022. The First Affidavit was filed and served in support of the summons. A statement of claim was filed on 14 November 2022 and seeks relief including:

“1   An order that the defendant forthwith make available to the plaintiff for inspection the following documents:

a   all financial statements related to the MJ Hall Testamentary Trust (as established by trust deed set out in the Will of Marshall John Hall dated 7 October 2011) (Trust) for the years ended 2013 to date and if these are not available all general ledgers relating to all transactions undertaken in relation to the Trust;

b   all documents recording all distributions made by the trustee for the years ended 30 June 2013 to date;

c   all minutes of meetings or resolutions in relation to the Trust for the years ended 30 June 2013 to date and if these are not available all documents relating to all transactions undertaken in relation to the Trust;

d   all bank statements for all accounts held by the trustee relating to the Trust for the years ended 30 June 2013 to date; and

e   all correspondence relating to the Trust passing between the trustee and any beneficiary of the Trust for the years ended 30 June 2013 to date.

2   An order pursuant to section 70(1) of the Trust Act 1925 (NSW) that Tamara Goodwin and Asheetha Jelllffe be substituted as trustees in the place of the defendant to the Trust.

3   An order that the defendant deliver the books and records of the Trust to Tamara Goodwin and Asheetha Jelliffe at Level 9, 70 Phillip Street, Sydney within 7 days of the date of this order.”

The First Affidavit

10. Because of its importance to the resolution of the issues on this review, it is necessary to say something in detail about the structure and content of the First Affidavit. For convenience, I reproduce again paragraph 2 of that affidavit:

"2. This affidavit is based on my own knowledge of the facts and information available to me, from my review of the file in relation to this matter and information provided to me by the Plaintiff.”

11. There is then a section entitled "Background" which sets out by way of overview a number of basal facts which, with one exception, it is difficult to see how they could be matters of contest. The exception is paragraph 12 which states:

“I am informed by the Plaintiff that:

a.   the has not received any distributions from the Trust; and

b.    there is longstanding and irreconcilable conflict between him and the Defendant as set out in the correspondence included in the Exhibit to this affidavit.”

12. According to Mr Brown, there is a dispute which the defendant wishes to test about the matter referred to in paragraph 12(b).

13. The First Affidavit then has a section headed "Correspondence Between the Parties". This commences with the chapeau:

"Some of the correspondence between the Plaintiff, the Defendant and their solicitors regarding the Deceased's estate and the Trust is at tabs 3 to 60 of the Exhibit and includes copies of the following."

14. There are then listed fifty-eight items of correspondence which are exhibited in a folder to the First Affidavit.

15. After the list of documents, there follows what might be described as an overview or description from the point of view of the plaintiff of what that correspondence shows. This includes the following statements:

1. In paragraph 14(a): "I am informed by the Plaintiff that no distributions have been received by the Plaintiff or his children from the Trust...".

2. In paragraph 14(d):

   "I am instructed that the Plaintiff's approval has not been sought for any expenditure on the Ingleside Property, despite there being various unexplained expenses listed in the accounts for the Trust in relation to the Ingleside Property that have been provided to the Plaintiff (see at tabs 47 and 48).”

3. In paragraph 14(e): "I am informed by the Plaintiff that the Defendant has not sat down with the Plaintiff to discuss the needs of the family."

4. In paragraph 14(f): "I am informed by the Plaintiff that this led to further distrust of his brother".

5. In para 14(j): "I am informed by the Plaintiff that this is not correct" (referring to a suggestion about the number of lawyers that the plaintiff has used).

(6)   In the chapeau of paragraph 15:

"I am informed by the Plaintiff to depart from the set of financial statements styled 'Estate John Hall/Trust' for the financial years ending 2016 to 2020 (accounts) provided to the Plaintiff (see tabs 47 and 48), the Plaintiff has not been provided with further information about the Trust from the Defendant.”

1. In paragraph 15(g):

   “The Plaintiff has made enquiries about the expected commercial rate of rent for the properties and has been informed that the rental should be approximately $1,000 per week for each 4 bedroom house and $600 per week for each 2 bedroom cottage, being an estimated total of $166,400 per annum for the 4 dwellings, yet the accounts only record rent of $101,541.93.”   

   16. After the summary of a great deal of correspondence, the First Affidavit concludes with a section headed "Removal of Defendant As Trustee" which includes:

   “16. The correspondence set out in this affidavit between the Plaintiff and the Defendant demonstrates a long-running mutual antipathy between the parties. The Plaintiff contends that given the irreconcilable conflict between the parties, the Defendant should be removed as the trustee of the Trust, and an independent third party trustee should be appointed in his place.”

   17. The circumstances of the creation of the First Affidavit were the subject of further evidence from Ms Vojvodic in an affidavit affirmed on 29 June 2023 (the Second Affidavit) in support of the present motion for review. This included:

   “Documents sought by the Notice to Produce

   5   The Notice to Produce (annexed to the Affidavit of Mary Wlndeyer sworn on 16 February 2023) seeks:

   a   the original "file" referred to in paragraph 2 of the affidavit of Snezana Vojvodic affirmed on 17 May 2022 (My Affidavit); and

   b   copies of the documents recording the information provided by the plaintiff to Snezana Vojvodic referred to in paragraph 2 of the affidavit of Snezana Vojvodic affirmed on 17 May 2022.

   6   In making My Affidavit, my review of the Plaintiff’s "file" was limited to the following documents:

   a   the documents specifically referred to in My Affidavit and Included In Exhibit SJV-1; and

   b   other correspondence between the Plaintiff and the Defendant (or between their respective legal representatives) on the file.

   7   In addition to the documents referred to in paragraph 6 above, the Plaintiff's original solicitor's file includes the following documents:

   a   correspondence between the Plaintiff and BWS;

   b   correspondence between BWS and the Plaintiff;

   c   other communications and advices between the Plaintiff and BWS, and BWS and counsel;

   d   draft tax invoices and final tax invoices issued to the Plaintiff by BWS; and

   e   file notes recording conversations and meetings between the Plaintiff and its legal representatives.”

   18. I also granted leave to Mr Brown for limited cross-examination of Ms Vojvodic in relation to the creation of the First Affidavit. The effect of the evidence that she gave in cross-examination was that the File is large (although there is no evidence before me of how big it is beyond that it contains correspondence and other material going back over a large number of years) and is in part electronic, and in part paper.

   19. Ms Vojvodic explained that she instructed an assistant solicitor in her office to conduct a preliminary view of correspondence in the File which would be used as evidence in the proceedings, and that she (Ms Vojvodic) then reviewed the correspondence that had been selected to come to a final view as to what would be included in the First Affidavit.

   20. She accepted that the universe of documents which she reviewed were those referred to in paragraph 6 of the Second Affidavit (see [16] above) and that she did not review the documents referred to in paragraph 7 of that affidavit.

   21. Finally in relation to the First Affidavit, Ms Francois told me that it was no longer proposed to read the First Affidavit at the final hearing. Instead, the specific correspondence upon which the plaintiff proposed to rely would be tendered. While that may be so, to the extent that the filing and service of the First Affidavit has any of the consequences contended for by Mr Brown, the fact that it is no longer to be read makes no difference. Ms Francois did not suggest otherwise.

The notice to produce

22. By his solicitor, the defendant issued a notice to produce dated 2 November 2022 to the plaintiff (the Notice) which sought:

“You are required to produce the following documents or things for inspection by the defendant by 17 November 2022:

1   The original ''file" referred to in paragraph 2 of the affidavit of Snezana Vojvodic affirmed on 17 May 2022.

2   Copies of the documents recording the information provided by the plaintiff to Snezana Vojvodic referred to in paragraph 2 of the affidavit of Snezana Vojvodic affirmed on 17 May 2022.”

23. The plaintiff did not comply with the Notice. It is not necessary to record the correspondence that passed between the parties on what became the neuralgic question of whether or not there should be any compliance with the Notice.

The decision of the registrar

24. On 15 February 2023, the defendant filed a notice of motion for relief including:

“1   That the Plaintiff comply with the notice to produce for inspection served on 2 November 2022 within 7 days.

2   In the alternative, that the Plaintiff produce the following documents or things to the Court within 7 days:

a   the original “file” referred to in paragraph 2 of the affidavit of Snezana Vojvodic affirmed on 17 May 2022; and

b   copies of documents recording information provided by the Plaintiff to Snezana Vojvodic referred to in paragraph 2 of the affidavit of Snezana Vojvodic affirmed on 17 May 2022.”

25. The defendant’s motion was heard by the registrar on 12 May 2023. The registrar delivered her decision on 21 June 2023, with an immaterially revised version of the judgment being published on 29 June 2023. The registrar made these orders:

“1   That the Plaintiff comply with the notice to produce for inspection served on 2 November 2022 within 14 days.

2   Plaintiff to pay defendants costs of the motion filed on 15 February 2023.”

26. The registrar's reasons record that the plaintiff objected to compliance with the Notice on the basis that first, the File was privileged; second, that the Notice was too broad because the whole File could not be relevant to the issues in the proceedings; and third, that the Notice was an impermissible substitute for discovery.

27. The defendant submitted before the registrar that as a matter of procedural fairness he was entitled to test the evidence given by Ms Vojvodic in the First Affidavit, and insofar as there was any privileged matter in the File, it had been impliedly waived by paragraph 2 of the First Affidavit and the fact that the plaintiff proposed to prove his case solely through Ms Vojvodic's evidence.

28. The registrar identified the relevant principles as those set out by the Court of Appeal in GR Capital Group Pty Ltd v Xinfeng Australia International Investment Pty Ltd [2020] NSWCA 266, in particular this summary of the authorities by Macfarlan JA:

“57   I draw from these authorities the following propositions of present relevance:

(1)   The test is one of inconsistency between the privilege holder’s conduct and its maintenance of the privilege, not one of general fairness or of relevance to an issue in the proceedings.

(2)   Enquiring whether the privilege holder has made express or implied assertions about the contents of the confidential communications, and whether its conduct has therefore “laid open the communications to scrutiny”, assists in ensuring that the court’s focus is on inconsistency rather than simply relevance. If the privilege holder is understood to be asserting something about the contents of the communications, it is but a short step to conclude that it would be inconsistent for it to prevent those contents being scrutinised.

(3)   On the other hand mere relevance of the content of the privileged communications to an issue raised in the proceedings by the privilege holder does not equate to inconsistency – something more is needed. It is of the essence of legal professional privilege that, if maintainable, it entitles a party to withhold potentially relevant documents from inspection by the other party.

(4)   The determination of whether there has been an express or implied assertion about the contents of privileged communications giving rise to a relevant inconsistency is an evaluative decision to be made after consideration of the whole of the circumstances of the case. No hard and fast rules can be formulated. Those circumstances will include the degree of relevance of any advice to the issues in the proceedings, the centrality of the relevant issues in the proceedings and the likelihood of advice having been given, informed, as the High Court said in Mann v Carnell, by considerations of fairness.

(5)   Having considered all those circumstances, the court must decide whether it would be inconsistent with the privilege holder’s conduct for it to maintain privilege. The line between relevance to an issue and inconsistency in this context may be very fine and therefore one on which views might well differ.”

29. The registrar accepted Mr Brown’s submission that by deploying the First Affidavit and its contents in the way in which the plaintiff had, and proposed to do, the plaintiff had "laid open the communications to scrutiny" that were referred to in the File and the File itself. The registrar accepted that this was more than a mere reference to something that might otherwise have no effect on, for example, a privilege claim.

30. Insofar as the registrar rejected the plaintiff's argument concerning the irrelevance of the File, she noted that the difficulty was that in circumstances where the plaintiff had apparently "based their whole case on the file, and by inference, they must have considered the whole file relevant" (registrar's decision at [32]).

31. Finally, for similar reasons, the registrar was of the view that the Notice was not an abuse of process as an improper attempt to obtain discovery by some other means.

The review

32. Although developed in greater detail, I intend no disrespect to the industry of counsel in recording that the parties' respective arguments on the review remained essentially the same as those put to the registrar.

33. Ms Francois submitted that the File was privileged and much of its content was necessarily irrelevant.

34. Mr Brown submitted that the whole of the File had been “laid open to scrutiny” by the First Affidavit, especially by the express reference to it in paragraph 2.

35. Furthermore, he submitted that insofar as the plaintiff might contend that there was privileged material in the File, the plaintiff had failed to file any evidence to make good the claim for privilege in relation to particular documents. For this submission he relied on the decision of the Court of Appeal in Hastie Group Limited (in liq) v Moore (2016) 339 ALR 635; [2016] NSWCA 305:

“Authorities on sufficiency of proof

12 There are many statements in the authorities that a party who claims privilege for a communication or document bears the onus of proving that it was prepared for the dominant purpose of the provision of professional legal services relating to Australian or overseas proceedings or anticipated proceedings in which the client is or may be a party. Thus, in AWB Ltd v Cole (No 5) (2006) 155 FCR 30; [2006] FCA 1234 [AWB Ltd] Young J, at [44], stated:

“(1)   The party claiming privilege carries the onus of proving that the communication was undertaken, or the document was brought into existence, for the dominant purpose of giving or obtaining legal advice. The onus might be discharged by evidence as to the circumstances and context in which the communications occurred or the documents were brought into existence, or by evidence as to the purposes of the person who made the communication, or authored the document, or procured its creation. It might also be discharged by reference to the nature of the documents, supported by argument or submissions …” (emphasis added)

13 Young J, in support of the proposition emphasised in the above passage, cited the statement of the plurality in Grant v Downs (1976) 135 CLR 674; [1976] HCA 63 at 689. The plurality stated there:

“It is for the party claiming privilege to show that the documents for which the claim is made are privileged. He may succeed in achieving this objective by pointing to the nature of the documents or by evidence describing the circumstances in which they were brought into existence. But it should not be thought that the privilege is necessarily or conclusively established by resort to any verbal formula or ritual.”

Their Honours added the cautionary note that “… it should not be thought that the privilege is necessarily or conclusively established by resort to any verbal formula or ritual”.

14   Young J repeated what had been said by the plurality in Grant v Downs about resort to formula or ritual and continued, at [44]:

“(3)   … Nor is a claim of privilege established by mere assertion that privilege applies to particular communications or that communications are undertaken for the purpose of obtaining or giving ‘legal advice’ … If assertions of that kind are received in evidence in support of the privilege claim, their conclusionary nature can leave unclear what advice was really being sought. There will be cases in which a claim of privilege will not be sustainable in the absence of evidence identifying the circumstances in which the relevant communication took place and the topics to which the instructions or advice were directed …

…

(6) An appropriate starting point when applying the dominant purpose test is to ask what was the intended use or uses of the document which accounted for it being brought into existence …: Pratt Holdings Pty Ltd v Commissioner of Taxation (2004) 136 FCR 357 at [35] per Finn J.”

15 Statements to like effect have been made, not only in the cases cited by his Honour, but more recently in Archer Capital 4A Pty Ltd v Sage Group Pty Ltd (No 2) (2013) 306 ALR 384; [2013] FCA 1098 at [13]-[14] and in Hancock v Rinehart (Privilege) [2016] NSWSC 12 at [7]. As the respondents placed reliance upon those paragraphs in each of these judgments and as we wish to make certain observations as to them below, it is appropriate to set them out in full.

16   In Archer Capital 4A v Sage Group Wigney J stated:

“[13] The party claiming privilege bears the onus of proving that the communication was made, or the document created, for the dominant purpose of giving or obtaining legal advice or aiding in the conduct of litigation or prospective litigation. It is not sufficient for a party to merely assert a claim for privilege; the party claiming privilege must establish the facts that provide the basis for the claim: National Crime Authority v S (1991) 29 FCR 203 at 211; 100 ALR 151 at 159; Kennedy v Wallace (2004) 142 FCR 185; 213 ALR 108; [2004] FCAFC 337 at [13]–[17] (Kennedy). The existence of privilege is not established by mere verbal formula, even if unchallenged: Grant v Downs (1976) 135 CLR 674 at 689; 11 ALR 577 at 589 (Grant).

[14]   It may be necessary for there to be evidence identifying the circumstances in which the relevant communication took place and the topics to which the instructions or advice were directed: Kennedy at [12]-[17]. The court has the power to examine documents in respect of which a claim is made, and should not hesitate to exercise that power where the claim is challenged: Grant at CLR 689; ALR 589.”

17   In Hancock v Rinehart (Privilege) Brereton J stated:

“[7]   To sustain a claim of privilege, the claimant must not merely assert it; but must prove the facts that establish that it is properly made. Thus a mere sworn assertion that the documents are privileged does not suffice, because it is an inadmissible assertion of law; the claimant must set out the facts from which the court can see that the assertion is rightly made, or in other words ‘expose … facts from which the [court] would have been able to make an informed decision as to whether the claim was supportable’. The evidence must reveal the relevant characteristics of each document in respect of which privilege is claimed, and must do so by admissible direct evidence, not hearsay.” (citations omitted)”

36. To this last submission, Ms Francois responded that it was open to the plaintiff to demonstrate that the documents were the subject of privilege by reference to their nature as documents on a solicitor's file (see Young J (as his Honour then was) in AWB Ltd quoted in [34] above).

Consideration

37. In my respectful view, a fundamental difficulty with the way in which the argument was conducted both before the registrar and before me has been the undifferentiated treatment of "the File". In one sense, that is understandable given Ms Vojvodic's reference in the First Affidavit to "the file". Nevertheless, Mr Brown quite properly accepted that the File would necessarily contain things that were completely irrelevant to the matters in issue, such as costs agreements and invoices.

38. For her part, Ms Francois candidly accepted that not all the contents of the File could possibly be privileged: for example, correspondence between the solicitors for the parties or file notes recording instructions given by the plaintiff to his solicitors that were then expressly referred to in the First Affidavit (see [14] above).

39. Notwithstanding these entirely sensible concessions on each side, it is also necessary to record that at every turn when I pressed Mr Brown to be precise about what it was his client was actually seeking from the File, his answer was that his client was entitled, for the reasons he advanced, to the whole File.

40. As the argument developed, it reduced to a debate about those documents that were subject to client legal privilege on the File. Ms Francois accepted that all of the correspondence on the File that was between the plaintiff and the defendant themselves or their respective solicitors could not be the subject of privilege (there being no point taken that a copy of a document on the file had been produced for a purpose that made the copy privileged).

41. What the parties ultimately recognised as being at the heart of their dispute were documents that could be the subject of client legal privilege including, in particular, according to Mr Brown, those advices or records of instructions referred to in paragraph 7 of the Second Affidavit (see [16] above). Mr Brown contended that insofar as such documents existed, they must have formed part of the information or knowledge to which Ms Vojvodic referred as being the basis of the evidence that she gave in her First Affidavit.

42. The fundamental difficulty with Mr Brown's submissions is that, in my respectful opinion, paragraph 2 of the First Affidavit does not in and of itself constitute an express or implied waiver of client legal privilege of any documents that may be contained in the File. Paragraph 2 cannot, and should not, be read in isolation from the rest of the First Affidavit, and an inquiry must be conducted as to what has actually been deployed, and how, in the First Affidavit.

43. The Court accepts, for example, Ms Francois' submission relying upon the decision of Rolfe J in Ampolex Ltd v Perpetual Trustee Co (Canberra) Ltd (1996) 40 NSWLR 12 that for the purposes of disclosing advice so as to lose the benefit of privilege, what must be disclosed is a statement of the advice or its substance or effect. Mr Brown fairly conceded that if one looked beyond paragraph 2 of the First Affidavit, there was no reference anywhere in the First Affidavit to any advice or even the substance of any particular piece of advice.

44. In most cases, the proper response for a party in the position of the plaintiff seeking to rely on a claim of client legal privilege would be to provide affidavit evidence of the kind identified by Brereton J, as his Honour then was, in Hancock (quoted in [34] above). However, in circumstances where the plaintiff was confronted by a request for the entirety of a solicitor's file, and given the nature of the issues in this case, I accept Ms Francois' submission that her client could discharge the obligation to demonstrate privilege "by reference to the nature of the documents supported by argument or submissions" (relying on the dicta of Young J in AWB Ltd (also quoted in [34] above)).

45. Paragraph 7 of the Second Affidavit clearly identifies as a category advices and other communications that would be subject to client legal privilege. It is sufficient for present purposes for the Court to find, as it does, based on that paragraph that the File must contain such material. The question, when faced with an undifferentiated request for an entire file, then becomes to consider, by reference to the terms of the First Affidavit itself, in what communications and advices might privilege have been waived. That was not a course with which Ms Francois cavilled. She accepted that privilege must have been waived in file notes and other records of communications between the plaintiff and his solicitor which have subsequently been referred to as matters of instruction or information provided by the plaintiff to Ms Vojvodic in the First Affidavit (see [14] above).

46. Starting with the simple proposition that even the defendant accepted that there was going to be irrelevant material in the File, it follows that the defendant was never entitled to the File in its entirety. It is unfortunate that the defendant made no attempt to specify the documents that were sought from the File. That could have been easily done by a close examination of the terms of the First Affidavit itself and then either by exclusion of plainly irrelevant material, or by express inclusion by reference to the issues in the case and the evidence. The requirement in s 56 of the Civil Procedure Act 2005 (NSW) to focus upon the just, quick and cheap resolution of the issues generally in dispute required such an approach. While the First Affidavit does refer to the File, when paragraph 2 is read in its terms and in the context of the entire affidavit, the Court cannot accept the submission that paragraph 2 gave the defendants an entitlement to access to the entire File.

47. For these reasons, the Court will set aside the orders made by the registrar. Nevertheless, again having regard to s 56, it is plain that the parties accept that there are certain categories of documents from the File to which the defendant is entitled and which could properly have been sought arising from the filing and service of the First Affidavit. Therefore, the Court will make orders to progress matters by requiring the production of those documents.

Costs

48. Ms Francois sought her client's costs both of the proceedings before the registrar and of the review today on the basis that her client has succeeded as to both, and costs should follow the event.

49. Mr Size submitted that in essence the Court has heard two separate proceedings. In the proceedings before the registrar, the defendant was successful on the material then before the registrar. He submitted that because, for example, the Court has today had the advantage of the Second Affidavit, and a better understanding of the process of how the First Affidavit was prepared and the contents of the File, today has gone off on a sufficiently different basis that the Court should not disturb the costs outcome before the registrar.

50. I do not accept Mr Size's submission. The question before the registrar was whether or not the defendant was entitled to production of, and access to, the File pursuant to the Notice. I have come to the view, for the reasons set out above, that the registrar erred to order compliance with the Notice. In those circumstances, costs should follow the event below as it should have been, namely that the defendants should pay the plaintiff's costs of the proceedings before the registrar.

51. Turning to the costs of the review, again the starting point is that costs should follow the event. However, Mr Size submitted that costs should be in the cause because the Court had decided to order the production of a limited class of documents by the plaintiff.

52. There are two connected difficulties with that argument. First, insofar as the Court is ordering the production of a limited class of documents, there was no resistance from the plaintiff when the Court observed that those documents seemed to be documents about which there could not possibly be any argument as to the obligation to produce them as a subset of the File. Related to that was the fact that on each occasion that the Court had sought, during the course of argument, to invite the defendant to narrow the categories of documents sought, the defendant maintained the position that on his case he was entitled to the entire File. The outcome today is that, on any view, the defendant was not entitled to the entire File.

53. For these reasons, the matters advanced by Mr Size in relation to the costs of the review are insufficient for the Court to exercise its discretion to displace the general principle that costs should follow the event, in this case being the granting of the relief sought in the plaintiff’s notice of motion for review that the learned registrar’s orders should be set aside.

54. One other argument as to costs was raised at the conclusion of the hearing. Ms Francois submitted that the defendant should not be entitled to indemnity from the Trust for his costs both of the proceedings before the registrar and of the review before me today, and for those costs he has been ordered to pay.

55. In my respectful view, the just determination of that question will require an examination of the defendant's conduct of the entirety of the litigation, of which the hearing before the registrar and of the review will, it appears, form but a small part. It would be necessary for any judge considering the question of the defendant’s entitlement to indemnity from the Trust to have a much deeper understanding of the issues between the parties than I do, and knowledge of the ultimate outcome of the litigation, in order to come to a fair assessment of whether or not the defendant was entitled to indemnity from the Trust, or whether he was acting in self-interest as opposed to acting in the interests of the Trust as trustee.

56. At the conclusion of this aspect of the argument, Ms Francois accepted that, for the reasons I have just given, it was appropriate that I should not embark upon a determination of the issue of the defendant’s entitlement to indemnity. Against the possibility that issue may be agitated later, I will formally reserve it for determination by the trial judge.

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Decision last updated: 17 October 2023