Hunt v Numa

[2000] VSC 217

SUPREME COURT OF VICTORIA
COMMERCIAL & EQUITY DIVISION COMMERCIAL LIST	Not Restricted

R U L I N G

No. 5278/2000
F5157

REX HUNT & Anor

v

GREGORY CHARLES NUMA & Ors

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JUDGE:	Warren J
WHERE HELD:	Melbourne
DATE OF HEARING:	19 May 2000
DATE OF RULING:	19 May 2000
CASE MAY BE CITED AS:	Hunt & Anor v Numa & Ors (No. 1)
MEDIUM NEUTRAL CITATION:	[2000] VSC 217

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr S. Wilson QC with Mr L. Glick
For the Defendant	Mr P. Hayes QC with Mr R.N. Cameron

HER HONOUR:

1. In this matter the first plaintiff Mr Hunt is a media identity.  Some years ago, during the 1980s he developed a friendship or relationship with the first defendant, Mr Numa.  At that time, Mr Hunt's media career was in its early and developing phase.  In the early 1990s Mr Numa apparently recognised the attraction and potential of Mr Hunt as a media performer, especially in the area of fishing and the related interests of those who enjoy fishing as a hobby and leisure activity.

1. As a consequence, discussions occurred between Mr Hunt and Mr Numa that led to the establishment of a business relationship between the two men.  Essentially the relationship was one of Mr Numa acting as Mr Hunt's agent, manager and promoter in the media, and the advertising sector.  Their arrangement was surprisingly simple.  Mr Numa arranged the work for Mr Hunt, often for large sums, moneys were paid by the media outlet or advertiser to Mr Numa directly, who kept 20 per cent of the moneys inclusive of expenses and Mr Hunt received in turn from Mr Numa the balance of 80 per cent of those moneys.  There were not any formal arrangements or terms otherwise between them.

1. The arrangement was set in place on such an informal basis, it seems, largely at the behest of Mr Hunt who, as a result of earlier business experiences and enterprises, wanted to keep his affairs very simple.  It seems also that Mr Hunt trusted Mr Numa to act in his best interests in good faith and with the utmost honesty and integrity.  The relationship persisted on an uninterrupted basis throughout the 1990s.  During that time Mr Hunt's star rose to great heights, such that he was able to command substantial amounts of money for his performances and appearances, and even more so for his endorsement and personal promotion of products and services.

1. Mr Hunt was offered sums on occasions running to hundreds of thousands of dollars for his endorsement and promotion.  For example, a home loan provider, RAMS, agreed to pay Mr Hunt over a period of three years for his endorsement of its home loan service, $400,000 in the first year; $450,000 in the second year and $500,000 in the third year.  After the second year, RAMS apparently terminated its contract.

1. Commercial interest in Mr Hunt's services extended far and wide.  However, concerns arose in his mind apparently towards the end of 1999 as to the handling of his affairs and the accounting of moneys that he believed to be his, by Mr Numa.  Essentially Mr Hunt appears to have formed the belief that large sums of money that were properly his were not accounted for.  There was an underlying suggestion of dishonesty made against Mr Numa by Mr Hunt.

1. As a consequence, these proceedings were instituted, essentially seeking an accounting of moneys and the appointment of a receiver of the companies associated with Mr Numa.  There are underlying serious allegations in the proceedings of dishonesty, deception and breach of trust.

1. An application has been brought before me today on an interim basis before trial, seeking the appointment of a receiver of Mr Numa's companies, and alternatively that arrangements be set in place by way of a mandatory injunction to preserve moneys pending trial.  Those matters have been put to one side at the moment to deal with a preliminary issue.

1. The preliminary issue is that in the evidence put before me to support today's application, Mr Hunt in his affidavit seeks to rely upon a letter dated 18 April 2000 from Mr Brown, the solicitor for Mr Numa, and attachments to that letter.  The defendants challenge and dispute the entitlement of the plaintiff to rely upon the letter of 18 April 2000, on the basis that privilege attaches to the document.

1. The principles are well stated in relation to the attachment of privilege in the High Court authority in Field v. Commissioner for Railways (NSW) (1957) 99 CLR 285, and were more recently explored in a thorough analysis of all the authorities in Trade Practices Commission v. Arnotts Limited & Ors (1989) 88 ALR 69. Fundamentally the established principle is that where parties enter into discussions and negotiations with a view to settling their differences, privilege will attach to those discussions.

1. However, as was made clear by the judgment of His Honour Justice Beaumont (at 71) in the Arnotts case, the rule excludes proof of admissions made with a genuine intention to reach a settlement.  As was further observed by His Honour in that authority (at 73), the privilege is not absolute and cannot be relied upon to put a party in the position of being able to cause a court to be deceived as to the facts.  In other words, the court cannot allow a party to rely upon privilege to shut out evidence that would rebut inferences upon which that party seeks to rely.

1. In this matter one of the primary allegations made by Mr Hunt against Mr Numa is that there has been a breach of fiduciary duty.  In my view a fiduciary agent cannot purport to give an account of his conduct to his principal, rely upon that account as being the satisfaction of his duty, and then claim that the account cannot be looked at because it is privileged.

1. Once these proceedings were instituted, and indeed beforehand there was an extensive course of correspondence between the solicitors for the respective parties, essentially whereby Mr Hunt sought to obtain an account and explanation from Mr Numa as to the disposition of the relevant moneys, and Mr Numa through his solicitors, sought to provide an explanation.

1. The correspondence culminated in the letter from Mr Numa's solicitors of 18 April 2000, and enclosed in that letter were various schedules and documents said to provide in essence the information that was requested by Mr Hunt.

1. In my view, in light of the principles as stated in the authorities, privilege does not attach to the letter of 18 April 2000 or its attachments and enclosures.  This is borne out by the course of correspondence before the letter and more so by the course of correspondence that followed the letter.

1. Having dealt with the issue of privilege, I make the additional observation that in any event, in the overall context of this matter, applying the "Maurice principle", Attorney-General (NT) v. Maurice (1986) 161 CLR 475. I am satisfied that as a matter of fairness it would not be appropriate for the defendants to be permitted to rely upon privilege to deprive the plaintiffs of the opportunity of putting these matters as contained in Exhibit RH11 (the letter of 18 April 2000 and enclosures) properly before the court.

1. In those circumstances, the objection of the defendants that privilege attached to Exhibit RH11 is rejected, and the exhibit will stand.

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