Hill, F.L. v Westpac Banking Corporation

[1992] FCA 528

52% olz

JUDGMENT No. -.-.,.A .,.,..-

ERAL COURT OF AUSTRALIA 1 1

Y -

1     No VG 163 of 1991

1  

RAL DIVISION 1

BETWEEN: FRANCIS LOUIS HILL,

ADOLP JOHN HILL. ANN

PATRICIA HILL and

MARGARET MARY HILL

(Applicants)

AND :	W E S T P A C	B A N K I N G
CORPORATION

Ryan J
Melbourne

25 June 1992

EX TEMPORE REASONS FOR JUDGMENT

The applicants have moved for particular discovery of a large range of documents of which only one category is now controversial. That is the category consisting of personnel assessment files of three named officers of the respondent bank. One of those officers was, at the relevant time, the manager of the Heathcote branch, another was its Manager, Commercial Lending, and the third was its Manager, International Transactions. The statement of claim in this matter alleges that the applicants were induced to enter into an agreement to borrow the equivalent of AS1 million in Swiss francs by representations made to the effect either that there

a n	:
was no risk, or alternatively very little risk to the	applicants in a transaction of that kind, or that the foreign
currency loans were good loans and that the respondent had reasonable grounds for believing that there was no risk or very little risk in transactions of that kind. It is also pleaded that there were warranties by the respondent to similar effect and alternatively that the respondent had been negligent or otherwise in breach of a duty owed to the applicant in the following respects:

"(a) Failing to advise the Applrcants of the risk assocrated with:-

(i)    borrowing large sums of money in a foreign currency;

tii) borrowing sums of money in a foreign currency; (lii) borrowing large sums of money in Swiss francs; (iv) borrowing money in Swiss francs;

(V) enterlng into the Agreement;

(b) .' failing to give the Applrcants any or any sufficient advice

0oncerning:-

(i) hedging;

(ii) steps or procedures that the Applicants could take to protect their position rt the Australian dollar became devalued relative to the Swrss franc;

(rii) steps or procedures that the Applicants could take if the
Swiss franc was revalued relative to the Australran dollar;

(iv) steps or procedures that the Applicants should take to protect their positlon if the Australian dollar became devalued

relative to the Swiss franc;

(v) steps or procedures that the Appllcante should take if the Swiss franc was revalued relative to the Australran dollar;

(vi) the Applicants' exposure if there was any marked
fluctuation in the value of the Australian dollar or the S w ~ s s

franc;

(c) failing to advise the Applicants to hedge;

(d) failing to properly assess the suitability of the Applicants

and/or the appropriateness of the Applicant6:-

(ii) [sic] entering into a forergn currency loan transaction;

(e)	failing to warn the Applicants that the foreign exchange market
Was: -

(i) unpredictable;

(ii) highly unpredrctable;

(iii) highly volatile;
(iv) highly volatile and unpredictable;

(f) failing to advise the Appl~cants to engage independent, skill [sic], competent and diligent financial adviaers to adv~se them on the appropriateness of:-

(i) entering into the agreement;

(ii) borrowing sums of money in Swiss francs"

It will be seen from that resume of the pleadings that there is no allegation that the bank was negligent or otherwise in breach of its duty to the applicants by entrusting the transaction or the giving of advice to incompetent, inexperienced or otherwise unsuitable officers. I am prepared to assume that the personnel assessment files contain details of the performance, satisfactory or otherwise, of the relevant officers in the positions which they held at the relevant time and in earlier posts which they filled within the bank. I am also prepared to assume that those files would contain details of courses undertaken by the officers and the level of achievement attained by them in completing those courses.

However, I am not persuaded that material of that kind can be	related to matters in issue in the present application as
required by 0.15 r. 8 of the Rules of this Court. I have been referred by Mr Elliott of Counsel who appears for the applicant to other cases involving foreign currency loans which have been litigated in this Court in which it has been indicated that within the corresponding personnel files of other bank officers, indications have been discovered of directives or the specification of objectives to be attained
by that officer and an assessment of the extent to which he
attained those objectives, in particular in persuading customers of the bank to enter into foreign currency transactions or otherwise to sell products then being offered by the bank. However, in the present case, an affidavit has been sworn by Mr White of the respondent's solicitors in which he deposes:

"I have read the appraisal files of Ian Ross, Ken Fraser and Max Parkineon. Nowhere in these files are the words foreign currency loan, euro currency loan, offshore currency or offshore commercial loan or acronyms "ocl" or "fcl" used. These are the acronyms conunonly used by bankers for "overseas currency loan" and "fore~gn

currency loan" respectively. Nowhere in the files is there any reference to training in relation to international products or foreign currency related transactions. Nowhere in the flles are there any references to the training undertaken by the employee."

In those circumstances, I am not persuaded that an occasion has been demonstrated for the order of particular discovery of the documents generically described as personnel assessment files and accordingly make no order in respect of those documents.

I certify that the preceding four (4)

pages are a true copy of the ex tempore reasons for judgment herein of his Honour Mr Justice Ryan.

ssociate: m	u
Date:	25 June 1992

Counsel for the applicants:	Mr P Elliott
Solicitor for the applicants:	Galbally and 0'Bryan
Counsel for the respondent:	Mr C Scerri
Solicitor for the respondent:	Mallesons Stephen Jaques