Harpley Nominees Pty Ltd v Melbourne City Link Authority
[2001] VSC 149
•16 May 2001
SUPREME COURT OF VICTORIA
COMMON LAW DIVISION VALUATION, COMPENSATION & PLANNING LIST Not Restricted
No. 4482 of 2001
| HARPLEY NOMINEES PTY LTD (ACN 004 968 674) | Claimant |
| V | |
| MELBOURNE CITY LINK AUTHORITY | Acquiring Authority |
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JUDGE: | Balmford, J. | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 8 May 2001 | |
DATE OF JUDGMENT: | 16 May 2001 | |
CASE MAY BE CITED AS: | Harpley Nominees v Melbourne City Link Authority | |
MEDIA NEUTRAL CITATION: | [2001] VSC 149 | |
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DISCOVERY FROM NON-PARTY under rule 32.07 of the Supreme Court (General Civil Procedure) Rules 1999 – whether a party to a proceeding before the Court can seek discovery and inspection of certain specified documents and classes of documents from a person who is not a party to the proceeding after such an order has already been complied with by the non-party before another forum – whether such an application is oppressive.
Supreme Court (General Civil Procedure) Rules 1999 – rule 32.07
Ansett Transport Industries Ltd v The Commonwealth (unreported, decided on 3 April 1987).
Ensee Holdings Pty Ltd v BWN Holdings Pty Ltd (unreported, decided on 23 June 1994).
Lurgi (Australia) Pty Ltd v Gratz (unreported, decided on 14 November 1995).
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APPEARANCES: | Counsel | Solicitors |
For the Acquiring Authority | Mr C Canavan QC | Garland Hawthorn Brahe |
| For the Non-party Respondent | Mr D Star | Wollan Associates |
HER HONOUR:
This matter came before the Court pursuant to a summons filed on 24 April 2001 whereby the Acquiring Authority (“the Authority”) makes application for discovery under rule 32.07 of the Supreme Court (General Civil Procedure) Rules 1999 from Renard (Aust) Holdings Pty Ltd (“Renard”), which is not a party to the proceeding. The Authority seeks discovery and inspection of certain specified documents and classes of documents. An application contained in the same summons for discovery against Stephen D’Andrea Pty Ltd, another non-party, was resolved by consent and need not be mentioned again.
Rule 32.07reads:
32.07 Discovery from non-party
32.07 On the application of any party to a proceeding the Court may order that a person who is not a party and in respect of whom it appears that he has or is likely to have or has had or is likely to have had in his possession any document which relates to any question in the proceeding shall make discovery to the applicant of any such document.
This proceeding embraces two disputed claims between the Claimant (“Harpley”) and the Authority under the Land Acquisition and Compensation Act 1986 (“the Act”). Initially Harpley applied under section 80(a) of the Act to the Victorian Civil and Administrative Tribunal (“VCAT”) in proceeding No. 20773 of 2000 for determination of the disputed claims. On 23 February 2001 I ordered pursuant to Section 81(1)(c) of the Act that both claims be determined by this Court.
Harpley seeks compensation from the Authority in the amount of $1,093,247.50 in respect of a portion of certain land owned by Harpley in Moray Street, South Melbourne (“the land”) which was compulsorily acquired from Harpley pursuant to a Notice of Acquisition gazetted on 3 September 1998. The other disputed claim relates to temporary occupation of another portion of the land. The material before me contains some minor inconsistencies as to the precise relationship between the two disputed claims, but for present purposes nothing turns on this.
Harpley contends that:
§on 7 April 1998 it entered into Heads of Agreement with Renard pursuant to which Harpley was to construct premises on the relevant land for a Rolls Royce dealership and lease the premises to Renard for 10 years with an option for a further 10 years at an initial rental of $500,000 per annum plus outgoings, the Agreement being conditional upon the premises being completed by 31 March 1999 unless extended pursuant to its terms;
§by reason of the temporary occupation or compulsory acquisition or both, Harpley could not complete the premises by 31 March 1999 and on 3 December 1998 Renard lawfully rescinded the Agreement;
§given the existence of the Agreement the value of the land unaffected by the temporary occupation or compulsory acquisition or both was $1,900,000, whereas the value of the land affected by the temporary occupation or compulsory acquisition or both was $820,000, resulting in a loss of value of $1,040,000. That amount constitutes the greater part of the claim.
The issues in the proceeding include:
§whether the Heads of Agreement described a bona fide agreement entered into at arms length prior to the issue by the Authority of the relevant notices;
§the meaning and construction of the Heads of Agreement;
§whether, as a matter of fact, Harpley could have complied with the terms of the Heads of Agreement despite the temporary occupation or compulsory acquisition or both;
§causation, and in particular whether the alleged loss was caused by the temporary occupation or the compulsory acquisition or both;
§the extent and impact of Harpley’s duty to take reasonable steps to mitigate its alleged loss and whether it failed to comply with that duty, and if so the consequences of that failure;
§the extent to which legal professional privilege can be relied upon by Harpley or third parties to prevent contemporaneous documents relevant to matters such as reliance and knowledge being obtained by the Authority.
On 24 August 2000, at a time when the disputed claims were still before VCAT, the Authority applied to VCAT for an order that Renard file and serve a list of certain specified documents and classes of documents in its possession, being documents, broadly speaking, relevant to the preparation of the Heads of Agreement, and that Renard provide copies of those documents to the Authority upon request. Orders in accordance with that application (“the VCAT orders”) were made by consent on 26 September 2000 by VCAT constituted by Deputy President Bruce. In response, on 23 October 2000 the solicitors for Renard served on the Authority a list of documents, and on 22 November a supplementary list of documents. These lists were not on affidavit. The first list was signed for the firm of solicitors acting for Renard, and the supplementary list does not appear to have been signed at all. Neither list disclosed the means of knowledge of those solicitors. I am not to be taken as suggesting that the lists were other than a proper compliance with the VCAT orders.
Copies of some of the documents listed were produced to the solicitors for the Authority by the solicitors for Renard, who advised that the remaining documents were subject to legal professional privilege. At the instant hearing Mr Canavan, for the Authority, drew attention to certain issues arising as to the claim of privilege, but agreed that it was not necessary to resolve those issues at this stage. He also pointed out that it appeared from those documents which were produced that the firm of solicitors on whose behalf the lists of documents were signed was not the firm which had acted for Renard at the time of preparation of the Heads of Agreement.
Mr Canavan submitted that the following matters should properly be taken into account in support of the application:
that those documents which had been produced could be read as casting doubt on the claim that the Heads of Agreement were executed on 7 April 1998;
that none of those documents related to the negotiations for the Heads of Agreement or for the construction of the building, or for such matters as the details of the outgoings to be paid by Renard;
that it would have been expected that, in a transaction of such magnitude, documents relating to those matters would exist;
that the Heads of Agreement were said to have been executed on 7 April 1998, which was very close to 23 April, the date of the first temporary occupation;
that one director of Renard was the secretary of Hartley;
that when the request for non-party discovery was forwarded to the registered office of Renard on 9 August 2000, it produced the response from an officer of Renard that it had been forwarded to a person associated with Harpley.
These matters, in his submission, were relevant to the question of whether the Heads of Agreement was a bona fide agreement entered into at arms length, which went to the heart of the disputed claims.
Mr Star, for Renard, relied on the judgment of Marks J, delivered shortly after rule 32.07 came into operation, in Ansett Transport Industries Ltd v The Commonwealth (unreported, decided on 3 April 1987) where His Honour said at 6:
The Rules reflect the clear intention to distinguish between discovery between parties for which no order is required (r29.02 and r29.03) and discovery against a non-party for which an order is. The latter involves weighing a substantial complex of matters in the exercise of discretion. The purpose of r32.07 is clearly that of ordinary discovery, namely, to assist the administration of justice by minimising costs and facilitating the disclosure of information which would advance fair determination of the issues. This purpose would not be met should the Rule be used for collateral purposes, such as disadvantaging a business competitor. Also the Court must be careful not to allow the power to be used oppressively, for example, for mere fishing expeditions.
Mr Star submitted that the orders now sought were in substance and effect the same as the VCAT orders, which were made with the consent of the parties, and with which his client had complied. Mr Canavan conceded that the documents comprised in the VCAT orders fitted broadly the same categories as the documents sought on the summons, although there were differences of detail.
Given that concession, Mr Star submitted that the orders were sought by the authority for a collateral purpose or were otherwise oppressive, in that his client had already complied with what were effectively the same orders. When questioned as to what he submitted was the collateral purpose in question, he said that it was to re-open an issue which was closed. I do not perceive that purpose as being “collateral” in the sense referred to by Marks J in Ansett Transport Industries; it is merely a description of what, in Mr Star’s submission, the Authority is seeking to do, and a repetition of his submission as to oppression. There is no evidence before me of any purpose which I could regard as “collateral” in the context, and I do not propose to consider further the issue of collateral purpose.
The question for consideration is, therefore, whether the summons should be dismissed on the ground that it is oppressive, in that it seeks orders with which Renard has already complied. As Marks J pointed out in Ansett Transport Industries, the making of an order for non-party discovery involves the exercise of discretion. I would, with respect, adopt the statement of Hansen J in Lurgi (Australia) Pty Ltd v Gratz (unreported, decided on 14 November 1995) at 38, that that discretion is to be exercised in the light of all relevant circumstances in the particular case, and is not to be circumscribed by observations of judges made in other cases in relation to their own facts. Examples of such observations are set out in the judgment of Batt J in Ensee Holdings Pty Ltd v BWN Holdings Pty Ltd (unreported, decided on 23 June 1994) and it is not necessary to repeat them here.
Mr Canavan, in reply to the submission of Mr Star, pointed out that the essential difference between the VCAT orders and the orders sought in this Court was that the VCAT orders (no doubt consistently with the practice and powers of VCAT) did not require the making of an affidavit of documents. Thus the lists provided in response to the VCAT orders were not on affidavit, and were not executed by a responsible officer of Renard. Given the matters set out in paragraph 9 above, the Authority was not satisfied with a list of documents not on affidavit. He referred to the authorities cited at paragraph I 29. 01. 785 of Williams Civil Procedure: Victoria as to the possibility of cross-examination, in certain circumstances, of a deponent who has sworn an affidavit of discovery, a matter on which I make no comment.
Mr Star also queried the relevance of some of the classes of documents which are sought. He submitted that the Court should be satisfied, before making the order sought by the Authority, that those classes of documents were all relevant to a question in the proceeding, and pointed out the difficulty for a non-party of deciding for itself any question of relevance.
The validity of the Heads of Agreement between Hartley and Renard is a question in the proceeding which is central to the claims of Hartley. Given the matters set out in paragraph 9 above, and noting the contents of the documents already produced by Renard in response to the VCAT orders, I am satisfied that Renard has or is likely to have or has had or is likely to have had in its possession documents relating to that question. The formal requirements of rule 32.07 are therefore met. Having considered the matter, I accept the submission of Mr Canavan that each class of documents which is sought has relevance to that question.
Mr Star submitted, as I have said, that the summons is oppressive because it requires his client to do something which it has already done in another forum and another form. Given that submission, it is surprising that, rather than opposing the application, Renard did not offer to the Authority in response a simple affidavit exhibiting and confirming the lists provided in response to the VCAT orders. That course would, no doubt, have led to the hearing of a dispute as to the claim of legal professional privilege in respect of those documents which were not produced in response to those orders; a hearing which may well occur in the future. However, the making of an order which, on the basis of Renard’s own submission, could have been so readily complied with, cannot be regarded as oppressive.
I accept that, given the differences of detail between the orders sought on the summons and the VCAT orders, there may be additional investigations required to be made by Renard before it is in a position to comply with those orders. For that reason, Mr Star submitted that if I should decide to exercise the discretion, for reasons of convenience, efficiency and cost, the appropriate orders would be in terms of the VCAT orders, rather than in terms of the summons. However, Mr Canavan submitted that he understood that the orders set out in the schedule to the summons had been more carefully drafted than the VCAT orders, and accordingly, in so far as they differed from the VCAT orders, the order of the Court should be made in terms of the orders in the schedule to the summons. I accept that submission.
For the reasons given, I consider it appropriate in this case that I exercise the discretion conferred upon me by Rule 32.07 in terms of the summons which is before me, subject to the fact that the summons makes no reference to costs, a matter as to which I invite submissions from counsel.
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