Idoport Pty Ltd v National Australia Bank Ltd

[2000] NSWSC 338

Reported Decision: [2000] 49 NSWLR 51

New South Wales

Supreme Court

CITATION:	Idoport Pty Ltd v National Australia Bank Limited [6] [2000] NSWSC 338
CURRENT JURISDICTION:	Equity Division, Commercial List
FILE NUMBER(S):	SC 50113/98
HEARING DATE(S):	13,14 April 2000
JUDGMENT DATE:	14 April 2000
PARTIES :	Idoport Pty Limited & anor (Plaintiffs) National Australia Bank Limited & ors (Defendants)
JUDGMENT OF:	Einstein J

COUNSEL :	TJ Hancock & RC Titterton (Plaintiffs) JA Halley (Defendants)
SOLICITORS:	Withnell Hetherington (Plaintiffs) Freehill Hollingdale & Page (Defendants)
CATCHWORDS:	Practice and Procedure - Supreme Court Rules Amendment No. 337 - Detailed consideration of the Amendment against background of the Woolf Reforms in the United Kingdom - Overriding purpose to facilitate the just, quick and cheap resolution of the real issues in civil proceedings - Jurisdiction of the Supreme Court to order use of technology - Inherent jurisdiction of Supreme Court to regulate its own proceedings so as to promote matters relating to convenience, expedition and efficiency in the administration of justice, includes directing or ordering the parties to use certain procedures, if the benefits derived from the use of such procedures justifies the costs and will ensure that the hearing proceeds quickly and efficiently - Order that proceedings be heard in the Technology Court
LEGISLATION CITED:	Supreme Court Rules 1970 Civil Procedure Rules 1999 (UK)
CASES CITED:	Abse v Smith (1986) 1 QB 536 Arbuthnot Latham Bank Ltd v Trafalgar Holdings Limited [1998] 1 WLR 1426 Biguzzi v Rank Leisure Plc [1999] 1 WLR 1926 Christofi v Barclays Bank Plc [1999] TLR 487 Connolly v Director of Prosecutions (1964) AC 1244 Cowland & Kendrick v District Judges of the West John Fairfax and Sons v Police Tribunal (1986) 5 NSWLR 465 Lombard NatWest Factors v Arbis (unreported, Chancery Division, 29 October 1999) MacDonald & Anor v Thorn Plc [1999] TLR 691 Mullan v Birmingham City Council [1999] TLR 573 O'Toole v Scott (1965) AC 939 Re Harry Jagdev & Co [1999] TLR 598 Re Mintz [1999] TLR 536 Shikari v Malik [1999] TLR 391 Stephenson (SBJ) Ltd v Mandy [1999] TLR 550
DECISION:	Orders were made on 18 April 2000 requiring the parties to use the Technology Court for the hearing of the proceedings and identifying a number of particular matters such as the content of the electronic library to be prepared.

THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION - COMMERCIAL LIST

EINSTEIN J

FRIDAY 14 APRIL 2000 - ex tempore
Revised on 4 May 2000

50113/98 - IDOPORT PTY LIMITED & ANOR v NATIONAL AUSTRALIA BANK & ORS.

JUDGMENT

Background

1 HIS HONOUR: The final hearing of these proceedings is fixed to commence in mid June of this year. An extended interlocutory hearing took place in July-August 1999 and the issues which fall to be determined during the final hearing are to a substantial extent set out in the reserved judgment, [1999] NSWSC 828 delivered on 19 August, on that hearing. Since that point in time, however, movement has taken place in the pleadings. There are now cross-claim issues required to be added to the issues there identified as falling for determination. 2 The proceedings involve claims by the plaintiffs to very substantial damages indeed. The claims were summarised in the reserved judgment [at paragraph 309 and following] and extend to claims for billions of dollars against defendants including the National Australia Bank Limited.. 3 From the time when the interlocutory judgment was handed down until the present time the case has been case managed by me and there have been a number of interlocutory matters which have required to be dealt with, some of them having gone on appeal. The most recent estimate by the defendants of the court time required for the final hearing is an estimate of one year. Plainly, however, where complex litigation is estimated to take a considerable period of time, it is at this stage impossible for the parties, as the Court accepts, to give in any particularly conclusive way, an accurate estimate of the precise length of the hearing. Obviously enough the length of the hearing is influenced to an extent by what occurs during the hearing and from time to time estimates can be underestimates and estimates can be overestimates. 4 The plaintiffs have not, as I have understood it, generally accepted this estimate of the defendants as a reasonable present estimate of the hearing time but as I understand the position they, as with the defendants, could not possibly give any form of assurance or undertaking as to the precise length of time which the final hearing will take. 5 The question which has led to submissions and discussion today and late yesterday, last week and from time to time over a number of months now, involves the extent to which use of the Technology Court for the hearing of the proceedings is appropriate. The parties appear to me from time to time to have vacillated in their indications of desire in that regard. Most recently however, yesterday, as I have understood it, the defendants have indicated that they do not seek to have the use of the Technology Court. Their submission has been that whilst in principle they embrace the concept of the use of technology where appropriate to assist the parties and the Court to dispose of the proceedings as quickly and efficiently as possible, at the end of the day, for various reasons, in their view use of that Court would not be efficient in relation to these particular proceedings. 6 The plaintiffs on the other side of the record do desire to have the Technology Court utilised for the hearing of the proceedings and are of the view that use of that courtroom would be an efficient manner of seeking to get through the hearing in a practicable way with the minimum of time, consistent with the obvious requirement that all parties be permitted to take time and care with which to present their respective cases. 7 The parties have conveniently and pragmatically elected that the decision as to whether or not the Technology Court should be used for the hearing of the proceedings and as to whether or not particular subset considerations as to which aspects of the facilities offered by the Technology Court would be taken up and if so how and at what cost to the parties and the like, be treated rather informally. In that spirit there was, late yesterday afternoon and again in the morning, a detailed discussion at the Bar table, the parties mostly being seated for the purposes, in the presence of Ms Taggart who is the Manager Information Technology and whose responsibilities, until recently, have involved particularly the setting up of the Technology Court, but have recently been extended. Also present to participate and assist has been Ms Alison Stanfield whose experience as a project manager in or about or involving large litigation being project managed in an attempt to reduce the amount of paper being used to the maximum, has been provided to the parties. As I have understood it, a project committee on an informal basis has been set up for some time and Ms Taggart and Ms Stanfield have been in close discussions with both parties and their technical advisers for the purpose of following one another's requirements and wishes. 8 There are only in the order of approximately eight weeks which remain prior to the hearing commencing. This has now made it necessary and urgent for the Court to determine the issue. There is perhaps a real question as to whether the instant situation is to be regarded, as one would an application on an interlocutory basis in any other aspect of the proceedings, concerning, as it does, the administrative arrangements by the Court as to the particular courtrooms in which hearings are to take place. It may be appropriate to simply regard the position as one in which the Court determines the appropriate arrangements for the hearing of particular proceedings. There is, however, the added parameter here, that the use of the Technology Court, with or without and in what degree, particular of the facilities offered by that Court, does involve an undoubted expense which the parties will be required to pay. In those circumstances, it is necessary, albeit following this informal set of sessions, for the Court to determine and announce and rule as to which courtroom is to be provided and upon which bases. Those are the background circumstances giving rise to the delivery of these reasons for decision. 9 It is perhaps appropriate before going to the specific detail of the arguments in favour of and against use of the Technology Court, to refer to the jurisdiction of the Court to order the use of technology.

The Jurisdiction of the Court

10    The Court is possessed of an inherent jurisdiction to exercise powers which are necessary to enable it to act effectively within its jurisdiction: Connolly v Director of Prosecutions [1964] AC 1244 at 1301 per Lord Devlin. 11 The purpose of the implied jurisdiction is to allow the Court to make such orders so as to enable it to uphold, protect and fulfil the judicial function by ensuring that justice is administered according to law and in an effective manner: John Fairfax and Sons v Police Tribunal (1986) 5 NSWLR 465 at 476 per McHugh JA. 12 The inherent jurisdiction of the Court includes an untrammelled power of regulating its own proceedings: Abse v Smith [1986] 1 QB 536 at 555 per May LJ. 13 It is proper to exercise the power not only where it is strictly necessary to do so, but also to secure or promote convenience, expedition and efficiency in the administration of justice: O'Toole v Scott [1965] AC 939 at 959 per Lord Pearson. 14 Amendment No. 337 to the Supreme Court Rules articulates the overriding objective of enabling the Court to deal with cases justly: Rule 1 (1). The Court is obliged to actively manage cases to achieve this overriding objective. This includes making use of technology, giving directions to ensure that the trial of the case proceeds quickly and efficiently and considering whether the likely benefits of taking a particular step justify the cost of taking it: Rules 1.4 (1); 1.4 (2) (h) (k) and (l). 15 Hence the inherent jurisdiction of the Supreme Court to regulate its own proceedings so as to promote matters relating to convenience, expedition and efficiency in the administration of justice, includes directing or ordering the parties to use certain procedures, if the benefits derived from the use of such procedures justifies the costs and will ensure that the trial proceeds quickly and efficiently.

Amendment No. 337 to the Supreme Court Rules

16 Part 1 of the Supreme Court Rules as modified by Amendment No. 337, elucidates the overall objective of practices and procedures as specified in the Supreme Court Rules.

Overriding Purpose

Introduction

17    The overriding purpose of the Rules is to facilitate the just, quick and cheap resolution of the real issues in civil proceedings. As discussed by Gordon Exall [“Civil Litigation Brief: Woolf Reforms (3)” (1999) 143 Solicitors Journal p. 112], these regulations dominate the whole construction of the Rules as they must be taken into account whenever the court exercises any power given to it by the Rules or interprets any Rule.

18    Spigelman CJ, in an extra-curial address, explored what the new Rules identify: · ‘an obligation on the Court to give effect to the overriding purpose when it exercises any of its powers; · an obligation on a party to civil proceedings to assist the Court to further the overriding purpose and, to that effect, to participate in the processes of the court and to comply with the directions and orders of the Court; · an obligation on legal practitioners to refrain from engaging in conduct which causes his or her client to be put in breach of this duty;

· a power in the Court, when exercising the Court’s discretion to award costs, to take into account any failure to comply with these duties by a party or a legal practitioner.’ [Opening of the Law Term Dinner, 31 January 2000]
[ To date no Australian cases have considered the ‘overriding purpose’ clause. However, the Woolf reforms as instituted in the United Kingdom and their subsequent elucidation may provide a valuable source of persuasive authority. Ultimately, of course, Amendment No. 337 will be construed and applied by this Court on a case specific basis. One important point of distinction is that the Woolf reforms included, but were more extensive than, the insertion of an overriding purpose clause.

The Woolf reforms

Overview

20    Attempts to modernise the civil justice system in England have been numerous in recent years. Prior to the Woolf Reforms a Government Report was presented to Parliament in June 1988 which discussed the system in totality with a focus on ways to reduce delay, cost and complexity. The principal suggestions were not implemented.

21    As reviewed in The Woolf Reforms in Practice [(1998) London: Butterworths pp. 9-10,] a working party was subsequently established by the General Council of the Bar and by the Law Society in 1992 with the objective of radically examining the business of the civil courts. Its recommendations submitted in June 1993 included measures to promote settlement, increase efficiency and to introduce comprehensible procedures.

22    These proposals were followed by the appointment of Lord Woolf in March 1994 whose objectives were: · to improve justice; · to reduce the cost and complexity of the Rules and modernise technology; · to remove unnecessary distinctions of practice and procedure; and · to ameliorate unfairness (especially where the parties have unequal financial resources).

23    The context in which the Woolf Inquiry began its investigation was one where it was perceived that ‘civil litigation is in a state of crisis … a crisis for the government, the judiciary and the profession:’ [C Glasser, quoted in Access to Justice: Interim Report London: HMSO, (1995), p5]. The investigation operated in two phases. The first was consultative and led to the Interim Report ‘Access to Justice’ in July 1995. An additional period of consultation ensued resulting in the publication in July 1996 of the Final Report together with a draft of the new procedure Rules intended to form the essence of a new and comprehensive procedural code for all civil litigation.

24    Rule 1 of the new Civil Procedure Rules [CPR] contains an ‘overriding objective’ to enable the court ‘to deal with cases justly’. The Court has an obligation to give effect to the overriding objectives in exercising any power given to it under the Rules and when interpreting their implementation: (Rule 1.2). The overriding objective encompasses five principle which are given effect to in Rule 1.1(2)(a) - (e) and have been elucidated by Lord Woolf as follows: · First, that the parties are on an even footing. This is termed the ‘equality principle.’ The traditional approach of allowing a wealthier party to deplete the resources of their opponent will be abated by the judge; · Second, that expenses are minimised. This is known as the ‘expense principle.’ The expense of litigation can damage the commercial reputation of the country. Often those in the middle income bracket, too rich to qualify for legal aid but not rich enough to afford litigation, are unable to litigate at all, which is unjust; · Third, that cases are dealt with in ways proportionate to the amount in dispute, the importance of the case, the complexity of the issues, and the parties’ financial position. This is known as the ‘proportionality principle.’ · Fourth, that cases are dealt with expeditiously and wherever possible timetables are adhered to. Lord Woolf calls this the ‘expedition principle.’ · Finally, that court resources are appropriately allocated. A judge should take into account the consequences for the resources of the system when giving a direction. Lord Woolf does not give this principle a name.

[Lord Woolf “The Future of Civil Justice” (1997) 3 The Judicial Review pp. 103-107]

25    A major effect of the reforms is to shift much of the responsibility for the conduct of proceedings from the parties to the Court. Defendants are no longer able to rely upon the assistance of claimants in extending timetables where to do so would prove unfair or jeopardise the rapid progress of proceedings. The assumption is that timetables will be adhered to and that a failure to do so will result in sanctions. These extend to claims being struck out, experts and witnesses being precluded from giving evidence and costs orders being made against solicitors where appropriate.

26    The overriding objectives also alter the conduct of pre-litigation proceedings. For example, the Courts are required to consider the relative financial position of the parties when determining the scope of discovery (relabelled ‘disclosure’) and the instruction of experts. In the majority of cases the magnitude of disclosure will be decreased.

27    The intention was to achieve these objectives within the existing adversarial system. Yet as contended in The Woolf Reforms in Practice (supra) pp. 11-12, the amendments attempt to introduce a new litigation culture, some of the features of which are similar to civil law jurisdictions.

Case Law

28    A number of recent English cases have considered the operation of the ‘overriding objective.’

· Shikari v Malik [1999] TLR 391

Lord Justice Henry held that litigants and their legal advisers could not count upon what has been tolerated in the past being tolerated in the future. The Courts now expect procedural timetables to be followed. Court resources can be wasted where a party has failed to comply with such timetables, and as part of the overriding objective, the Court must allocate an appropriate share of its resources to each case.

· Christofi v Barclays Bank Plc [1999] TLR 487

Lord Justice Chadwick held that it must consider the overriding objective of approaching cases justly, which includes saving expense, dealing with the case in a way that is proportionate to the amount of money involved and sharing the Court’s time appropriately.

· Cowland & Kendrick v District Judges of the West London County Court (unreported, Court of Appeal (Civil Division), 20 July 1999)

Applying the overriding objective clause, the automatic exclusion of evidence was overruled.

· Stephenson (SBJ) Ltd v Mandy [1999] TLR 550

The Court of Appeal declined to go into the merits of an appeal on the basis that the expenses involved ought to be spared - it was not an appropriate allocation of resources. The Court emphasised that the parties to litigation are under an obligation to help the court to further the overriding objective. If the overriding objective is achieved the courts will be able to produce a greater ‘throughput’ of litigation, which may result in additional litigation against ‘deep-pocket defendants’.

· Mullan v Birmingham City Council [1999] TLR 573

Mr David Foskett QC sitting as a Deputy High Court Judge, held that under Rule 3.1(2)(m) of the Civil Procedure Rules the Court had a wide power ‘take any steps or make any order for the purpose of managing the case and furthering the overriding objective’. Accordingly, it was open to the judge to hear a submission by the defendant of no case to answer after the close of the claimant's case without the defendant having to elect not to call evidence in the event his submission failed. Submissions of no case to answer at the close of the claimant’s case were traditionally uncommon in civil proceedings because of the apparent risk in the event that the submission failed.

· MacDonald & Anor v Thorn Plc [1999] TLR 691

In this case, judgment in default of defence was entered against the defendant as a result of a slight delay in the writ being passed on to the defendant’s insurers. In the absence of any explanation for that delay, the County Court judge refused to set aside the judgment, notwithstanding the fact that the defendant had a viable defence. The judge at first instance based his decision upon Savill v Southend Health Authority [1995] 1 WLR 1254.

In the Court of Appeal, Lord Justice Brooke held that even on the basis of the old RSC authorities, the judge had exercised his discretion incorrectly in light of the fact that the defendant had a triable defence and that minimal prejudice would be caused to the claimant if the judgment was to be set aside.

As reviewed by David Sandy (1999) “The Civil Procedure Rules and Wing Mirrors” [at applying the overriding objective clause is problematic for practitioners and judges alike. The Court in MacDonald was asked to give some general guidance for future reference in situations where default judgments are entered because of delay in writs being transferred from lay defendants to their insurers. Lord Justice Brooke responded that no inflexible Rules as to having a judgment set aside existed. The overriding objective of the Civil Procedure Rules was to enable the Court to deal with cases justly, which included ensuring that cases were dealt with expeditiously and fairly. According to Brooke LJ, the discretion was wide and:

[t]his court, in my judgment, would be doing nobody any service in seeking to reintroduce into the interpretation of these Rules judgments of courts which were given under the old regime, insofar as the new regime has taken over from the old regime…This court should, however, in my judgment refrain from being prescriptive about the way the Circuit Judges and District Judges in the exercise of their discretion should apply Rule 13.3 [setting aside default judgments]. We are operating a new procedural code (Rule 1.1) and we must not be tempted to return to earlier judgments decided under the previous Rules and have them cited all over again with attempts to distinguish one conflicting decision from another.

· Lombard NatWest Factors v Arbis (unreported, Chancery Division, 29 October 1999)

Hart J held that it was not necessarily correct to apply the same rules of interpretation to the old and new rules of procedure.

· Biguzzi v Rank Leisure Plc [1999] 1 WLR 1926

When interpreting the Rules, the overriding objective will take priority over any existing case law. At the same time, the underlying reasoning process of a case such as Arbuthnot Latham Bank Ltd v Trafalgar Holdings Limited [1998] 1 WLR 1426 is still relevant. Lord Woolf stated that the Civil Procedure Rules is a ‘self-contained code’ and that ‘earlier authorities are no longer of any relevance once Civil Procedure Rules applies’. His Lordship explained that ‘looking back to old cases would mislead rather than inform’. Lord Woolf endorsed the approach of the decision at first instance by Judge Kennedy in the Brighton County Court who stated that it was his ‘firm belief that authorities decided under the old procedure should not be taken as binding or probably even persuasive upon this court, any more than looking back to the old Rules to interpret the new should be so’.

Lord Woolf in Biguzzi (at 1932) maintained that the overriding objective will allow judges to adopt a more balanced approach and to avoid taking ‘draconian steps such as striking out the proceedings in order to stop a general culture of failing to prosecute proceedings expeditiously’.

Academic writings

29    A number of papers have also addressed aspects of the overriding objective clause:

30    Richard Harrison [“Will Woolf Change the Way We Behave?” (1998) 148 New Law Journal pp. 1853-1854] initiates his discussion on the potential impact of the overriding objective clause on the litigation culture upon the contention that the Rule is ‘beyond criticism’. It pronounces what all practitioners would want to achieve for themselves and for their clients. It requires that solicitors will act more reasonably and proportionately whilst maintaining their drive to satisfy their clients’ commercial requirements. This will result in an immense increase in correspondence from lawyers to their clients and opposition, not for the chivalrous purpose of providing additional information, but to provide a good impression on the Court. [Regarding the ‘culture shock’, see also Richards Butler Commercial Litigation Group (1998) “Reform of the Civil Justice System - Lord Woolf’s Proposals”, 19 Business Law Review 142]

31    Writing extra-curially, Lord Browne-Wilkinson [“The UK Access to Justice Report: A Sheep in Woolf’s Clothing” (1999) 28 The University of Western Australia Law Review pp. 183-186] casts doubt on the extent to which the Woolf reforms will achieve cost savings in the conduct of litigation. He suggests that ‘procedural bickering’ over the interpretation and application of the new rules will, at least initially, provide ‘a happy hunting ground … for the lawyer seeking to delay a case or to use costs as a bargaining weapon against an impoverished opponent.’ Focusing on the overriding objective more particularly, Lord Browne-Wilkinson considers that it is ‘inevitable that there will be very many applications to the Court testing the balance to be struck between justice in the old sense of justice between the parties to the litigation, and cost, in the sense of cost to the legal system as a whole:’ (at 185).

32    Lord Browne-Wilkinson considers that Lord Woolf would respond to this critique in two ways. First, ‘by requiring all interlocutory questions to be dispensed with at a case management conference, held at the initial stages of a case, the number of interlocutory applications will be reduced:’ (at 185). Lord Browne-Wilkinson’s riposte to the notional reply of Lord Woolf is that similar previous attempts failed because the profession was unwilling to accept the alterations and would often lodge an appeal to review the outcome: (at 185). 33    Secondly, Lord Browne-Wilkinson considers that Lord Woolf would say that the reforms will result in a general shift in legal culture - a ‘new ethos of cooperation:’ [as to which see Ch 19 of the Interim Report (supra)]. Indeed, if lawyers fail to help the Court to further the overriding objective, strong sanctions will be exercised. However, Lord Browne-Wilkinson doubts how likely it is that lawyers will cooperate in the manner envisaged. His Lordship points out that it is the fundamental basis of the adversarial system that even a ‘veneer of reason’ will fail to conceal the aggressive approach of lawyers. Lord Browne-Wilkinson asserts that the common law adversarial system is ‘macho, anti-authoritarian and powerfully on the side of individual rights.’ Lawyers may well elect not to cooperate if a tactical or strategic advantage exists.

34    Thus, Lord Browne-Wilkinson doubts whether that Lord Woolf’s proposals will save costs in the way in which he anticipates, although he acknowledges that alternatives may be less than satisfactory.

35    Gordon Exall [Civil Litigation Brief: Woolf Reforms (3)’ (supra)] comments that much of the burden of the Woolf reforms falls upon the Court and that the success of the reforms will most probably depend on how the matters are handled by the Courts in practice and whether the Courts will use their powers to identify issues and save costs. .

36    David Sandy in another article ‘Dealing Justly’ [at maintains that the existence of the overriding principle provides the courts with significant discretionary powers to ameliorate the rigour of the new Rules. He argues that even though that may serve the interests of justice, it also makes the judicial process less certain and subjective. A judges perspective on what constitutes the interests of justice may be radically different from his/her judicial companions.

Solicitor Liability for Costs

37    Amendment No. 337 elucidates the overall objective of practices and procedures as specified in the Rules, as well as clarifying a practitioners duty to the Court. Although no question of it arises here, in the event that practitioners fail to ensure that proceedings are conducted expeditiously and efficiently, the Court is empowered to order costs against practitioners personally. Judges are aware that there are varied reasons why a solicitors case is not ready for trial. For example, if a client is unwilling or unable to provide funding for legal work, thereby causing delay, it is the solicitor who appears to be unprepared as they are often reluctant to reveal the true cause: [Young, P.W. “Ordering Costs Against Lawyers” (2000) 74 The Australian Law Journal pp. 75-76]. Such difficulties are evident in England with the administration of the scheme. In Re Mintz [1999] TLR 536 the English Court of Appeal (Criminal Division) in allowing an appeal by a barrister against a wasted costs order said at 536 that there was:

a crying need for those who sought to exercise the jurisdiction to make a wasted costs order to take the proper steps themselves before exercising it, otherwise they incurred costs which should never have been incurred.

38    Similarly in Re Harry Jagdev & Co [1999] TLR 598 the Court of Appeal (Criminal Division) held that an improper wasted costs order had been made against the solicitors. The primary outcome did not result from an improper, unreasonable or negligent act or omission by the representative.

39    Practice Note No. 108 outlines a practitioners duty to the Court and the procedures to be followed where the Court is minded to order costs against practitioners personally.

40    It is intended that by specifying the overriding purpose of the rules and the discretion afforded to judges in ordering costs, solicitors will be more willing to adopt case management techniques. As discussed by Justice Smellie of the New Zealand High Court: [“Case Management - Some Recent Observations” (1998) 3 The Judicial Review pp. 272-273], practitioners who fail to efficiently and expeditiously conduct cases deprive access to others who are prepared to be reasonable. Furthermore, the swift resolution of proceedings enhances public perceptions of the judicial process. 41    In what might be considered a related development, the Bar Association has also recently amended its professional ethical rules of a practitioners duties to the Court. These rules emphasise the importance of: · Confining a case to issues genuinely in dispute;
· Refraining from making allegations of fact without a proper basis;
· Complying with orders, directions, rules and practices of the Court;
· Preparing a case for hearing as soon as practicable;
· Presenting issues clearly and succinctly;
· Being as brief as reasonably necessary.

The Instant application

42 It is necessary then to return from the overview of the manner in which Amendment No. 337 of the Supreme Court Rules is now to be taken into account in determining any application in civil proceedings, to the circumstances of the subject application. 43 Notwithstanding the defendants initial stated attitude, it remains somewhat difficult to be certain as to the extent to which the defendants could be said, even on the informal discussion and examination of the alternatives, to be ‘contradictors’, in terms of actively opposing the suggestion that technology or depending on how it is to be used, the Technology Court, could be, and may well be in this case, of real utility. My understanding of the helpful way in which the defendant's counsel and instructing solicitor have addressed the Court has been, hopefully correctly, more that the defendants are anxious to assist the Court and to assist in seeking to identify the most efficient mode of administering justice in terms of the hearing of proceedings, than in terms of any fixed view away from use of technology to achieve this end. 44 In those circumstances, questions such as costs of and relating to the informal discussions which have led to these issues having to be determined, may well be entirely inappropriate. I have rather regarded what has been occurring as more of a discussion mode than a strictly adversarial mode to be determined one way or the other as a matter of formality. The discussion reduced to a consideration in relation to the pros and cons of using the Technology Court and its sundry facilities. 45 The formal position as it has been announced and accepted by both parties without the need for further evidence is as follows:

The proceedings involve a very large number of documents. The defendants have currently filed 117 statements. Those statements occupy approximately 5,700 pages of type. Additionally to that, and referred to in the defendant's statements, are some 40,000 pages of exhibits. Additionally to that the defendants have in the order of some 40,000 documents discovered or capable of requirement for use at some stage in the proceedings. It is possible and probable that some of the last mentioned figure of 40,000, overlaps with the 40,000 pages of exhibits. In short, as I understood Mr Halley of Counsel and Mr Lovell, solicitor, who have respectively addressed from time to time for the defendants today, it may be taken that there are certainly in excess of 100,000 relevant pages of materials to be arguably referred to, relied upon and/or conceivably tendered on the defendant's side of the equation.

46    The position, as far as the state which the defendant's have achieved in pre-trial preparation as announced, is that the defendants have substantially imaged discovered documents. They have not imaged documents relied upon or seen by experts, documents produced on subpoena, or documents discovered by the plaintiffs and which the defendants may determine to tender. 47    The position from the plaintiff's side of the record as announced by Mr Hancock of counsel who has addressed the court on this topic today, is that there are 15 statements which have been filed to date. There are approximately 7,500 pages of discovered materials, many already being exhibits to statements. In short, up to this point in time, as I have understood Mr Hancock, there are approximately 10,000 pages of documents which are or may be deployed by the plaintiffs for the purpose of the hearing. It is common ground, however, that in coming weeks the plaintiffs will be filing and serving a deal of material in reply. This is said to be likely to be in the order of 10,000 to 15,000 pages of documents. In short, from the plaintiffs’ side of the record, the trial may have to cope with in the order of 20,000 to 25,000 pages. When one adds that it is something in excess of arguably 100,000 pages of materials which are, or may be, relied upon on the defendant's side of the record, the parameters of the case become a little clearer.

48    The Technology Court issue raises the question of whether, when one is addressing it, one is addressing the question of a strictly paperless trial versus a hard copy paper trial. A detailed examination of the transcript of the proceedings today and late yesterday, will make plain that the defendants have indicated that their counsel, as I understand it, have considerable difficulty with accepting that it is possible to efficiently conduct cross-examination in a paperless trial fashion. The defendants have submitted that come what may, it is going to be necessary to have a large amount of paper in court. This I am the first to accept. The defendants have indicated that as they understand their respective senior counsels' perspective at the moment, when the defendants counsel are cross-examining the plaintiff's witnesses, those counsel intend in the main, and possibly exclusively, to use hard copy for the purpose of showing documents to witnesses and cross-examining upon those documents.

49    A very different approach is taken by the plaintiffs. Mr Hancock has made plain that the plaintiffs have given close consideration also, to the question of the most efficient way of conducting the hearing. The plaintiffs submit that a largely paperless trial would be the most efficient way of conducting the subject hearing. The submission is that when one endeavours to count the number of documents which would be included in the so-called ‘court book’ and the number of trolleys required to carry those documents to and from the courtroom, one is coping with, when one looks at generally the scope of the hearing, something in the order of 300 ringback folders in the court book. Mr Hancock submitted that this, on anyone's view, will take something in the order of 24 trolleys as required to take one set only to court. He then poses the spectre of some similar number of folders being required for perhaps one counsel as well as solicitors. When one adds in the situation on the other side of the Bar table, and the requirement to have the formal exhibit PX [the agreed bundle] in Court, as well as the bundle the Judge would have as his working copy, the spectre which would be faced (including the tying up of lifts) becomes, on his submission, quite obvious. 50    As I understand the position the defendants for their part, contend that whilst there may be indeed a requirement to have a considerable amount of paper present in the court, it is obviously an exaggeration to suggest that all of this material will have to be in court all of the time. It is submitted that, from time to time, sections of the hearing will be able to be quarantined and that the case may well proceed in a segmented fashion with possibly only materials appropriate to the then witnesses. 51    I have made plain during the course of the discussions that from my perspective, as the case is going to take such an extended period of time, the manner in which I personally approach preparation of the case for and during the hearing and in ultimately working towards producing the Judgment, is a further consideration which the court may particularly take into account. This consideration involves the trial Judge’s access by hypertext links, to transcript references to exhibits, as well as to statements, as well as to exhibits to statements, as well as to other necessary documents. In this regard early in the day, Mr Halley took the Court to the question of whether or not, if the Technology Court was to be used, one would really be requiring not an electronic ‘court book’, as much as an electronic ‘library’, which would embrace within it, the so-called ‘court book’, and which would include, as discussed today, the discovery lists filed by all parties, witness statements, tender lists, all submissions as well as, subject to a matter to which I shall mention in a moment, documents which the parties propose to tender. 52    In relation to the so-called agreed bundle, the defendants have been at pains to make plain that as they regard their forensic entitlement, there is no obligation and ought not be imposed an obligation upon the defendants, to describe in the agreed bundle, every document which they may or may not ultimately seek to have admitted into evidence. Mr Lovell indicated earlier in the day, that the defendants would be likely to seek to retain a not inconsiderable number of documents, against the event that these may or may not ultimately be seen as appropriate to be sought to be tendered, when the defendants are in their case. I make plain that the court accepts that as the defendants legitimate forensic entitlement. However, as I believe Mr Halley and Mr Lovell understand and accept, the Court generally expects the spirit and intent of the way in which Commercial List hearings are conducted in practice, to be here observed. The court expects that a careful and professional eye will be used by the defendants when they select the material to be included in the so called ‘agreed bundle’. Quite obviously there are likely to be a large number of documents which the defendants would presumably realise, are likely to be put into evidence by them. Hence I confidently expect that the agreed bundle, when it comes forward, will be just that, in terms that it represents a realistic endeavour by the defendants, while preserving to their camp the obvious entitlement to keep certain material close to their chest, to include in the bundle, documents clearly germane to the issues and likely be called up and referred to reasonably often. Naturally the parties will both conduct their cases as they see fit. 53    Turning then to the Technology Court, it has been, as I have understood it from Ms Taggart, described as including a fully integrated conferencing facility as well as a document management facility. There is to be provided in the Technology Court, full access for the judge into the Attorney General's wider network. Hence the judge does not have to move equipment such as a lap top and the like, to and from chambers to the court room. That access to the court is to the internet and the like. 54    Both parties by arrangement, where the Technology Court is to be used have, as I understand it, an entitlement to use the document management system. It permits the searching of large numbers of documents by electronic search retrieval methods. As I have understood it, that form of facility is available where documents are imaged. The position with respect to the defendants has already been set out. I should indicate that the plaintiffs have stated that whilst they have not yet imaged their documents or discovered documents, they have taken careful steps to work through how and when they are able to do this. They understand that it will take 2 days for those documents to be imaged and they can then be indexed depending upon the imaging system itself which is determined as necessary for the purpose. 55    I further add that I have understood from the defendants and accept, that the whole question of using a court book and use of their search retrieval and the like, is dependent upon the system which the defendants have used to date, being something which can be made compatible with the Technology Court system. 56    It is next necessary to refer to the bench tops which at the bar table in the Technology Court, can be used to access the document management system and the internet. Were the case to be heard in a conventional courtroom, there would be no such internet access to the parties. 57    The court has also been informed of the facilities available to access the system from either the work place of the parties, or from the Judges chambers, or from his home. 58    There is a rental fee attached to use of the Technology Court which includes a component to permit the internet use to which I have referred. 59    Then there is the fact that the Technology Court is said to be secure. It has been specifically described, as I have understood it, as “its own island”, in terms of court room access on this parameter. It has an internal network within the court room. Previous cases which have been run in past years have created their own mini network within the court room. 60    There is judicial access to a research facilities network, the internet and also limited telephone capacity. Many situations apparently involve case software, which as Ms Taggart has indicated, have a web interface which allows secure access over the web by external sources into the case management systems in offices. From the bar table, one is able, through the web, to access such case management systems (where such systems are in place), into solicitors’ offices and possibly Counsels’ chambers. That facility, I have been informed, is available through the use of the Technology Court. Ms Taggart is able to provide the parties with a direct internet connection through telephone lines from the bar table itself. One would then search discovery documents and other documents through that mode. 61    I have mentioned secure access for the bar table and the bench. That access I have referred to, in terms of internet access, dial out or access via external case systems which the bar table might require. Each person with access, if that was an option taken up, would have a secure telephone “dial in” through the Attorney General’s fire wall into the server which would be set up for the case. 62    Next there is the given that the Technology Court has a video conferencing link. 63    A court officer trained in the document management facility and in video link conferencing, would be made available by the court in the Technology Court. One of the questions which was raised particularly by the defendants today, involved the question, should the Technology Court be used, as to whether or not there would be proposed to also be a court officer for the purpose of carrying out the functions and duties which court officers regularly attend to, such as passing documents from witnesses to the Judge, from the witness box to the bar table, and from the Bar table to the Judge. That is a matter which is still to receive consideration. 64    Whilst I certainly understand the difficulties in relation to the need to have a court officer able to operate the system and the apprehension of the defendants, as to the need to have someone able to pass documents to and from the witness box, I would not think that parameter ought be the determinant factor, in terms of whether or not one uses the Technology Court in a case fixed to something up to, if not in excess of one year, involving a claim involving billions of dollars and involving the number of documents to which I have referred and the number of witnesses to which I have referred. A case also involving as I have understood it, quite a number of overseas witnesses, who from time to time would have to be called. 65    In relation to questions relating to overseas witnesses, I have made plain to the parties from time to time, that any application to be brought forward for any cross-examination of such witnesses will, at all times, be dealt with on their merits. To my mind everything depends on the particular circumstances. There may of course, be perceived to be a very special difficulty with being able to cross-examine a particular witness on video link. Nevertheless, it can of course, be the case, that for instance, an expert has given evidence for a certain period and is later required to be recalled, possibly for half an hour, or some more extended time. It may be that the factors which may have led the court at an earlier time, to refuse to order a video link hearing, may eventually fall away and result in portion of a witnesses’ evidence being so taken. Hence to my mind, the facility and opportunity of the parties using the video link conferencing facility, is by no means an insignificant aspect of what is currently under discussion and now for determination. 66    There is then also the question of the shelving which is available down both walls in the Technology Court. 67    Returning to the matters which were the subject of discussion earlier today, Mr Halley of counsel stated that one of the concerns that the defendants have, is that it would fall upon the defendants to prepare the court book. The defendants have consented to undertaking the task of preparing the hard copy agreed bundle. Mr Halley yesterday submitted in relation to the defendants’ position, that its view that the Technology Court should not be used, had not been a view reached lightly, but was a considered decision. As he put it yesterday, the question really is whether or not the Technology Court really justified the "amount of time necessary to make it work". 68    Ms Stanfield has made plain that if one does have a court book with the documents imaged in the fashion referred to, to be part of an electronically provided court book, it is possible in her view to call up documents extremely quickly and this is said to be a real time saving. Ms Stanfield estimated the amount of time to locate a hard copy document is something like 20 to 30 seconds whereas on her estimates yesterday, it takes something in the order, if the procedure is correctly used, of 2 seconds to call up such a document by a court operator. Mr Halley however pointed out that sometimes longer documents take a lot more time to call up. 69    The position then which confronts the court is that use of the Technology Court will add in a case such as this, a large number of parameters which would in all likelihood make conduct of the hearing reasonably efficient. A great deal of course depends upon the extent to which, during the hearing, the parties elect to use documents in Court on screen. Currently the Court is informed by the plaintiffs they intend to do exactly that. In the result, I anticipate when the plaintiffs come first to present their case and when the plaintiffs come to cross-examine the defendants 117 witnesses, the plaintiffs are going to basically seek to conduct that cross-examination in a paperless fashion. When and if Mr Garnsey QC, of counsel for the plaintiffs cross-examines a witnesses and Mr Bathurst QC opposes that form of cross-examination in relation to that document, I would, of course, should that occur, rule as to that issue. It may be the case that the court would require hard copy to be shown to the witness in many situations. It may be that the approach which will be taken, will be that the witness is entitled to have access to the hard copy versions in his or her own interests, so as to be in a position to understand the document and to fairly cope with the cross-examination. Notwithstanding the uncertainty at the present time as to the fate of any such contested applications, the plaintiffs have a genuine concern to keep the hearing moving as quickly as possible. Their approach, they say, is to endeavour to achieve this end by approaching many aspects of the hearing in a paperless fashion. 70    This is not, of course, to suggest for a moment, that the defendants do not desire to keep the hearing moving as quickly as possible. I accept that they seek precisely this. The problem is that each party has a differing view as to how to achieve the objective. To my mind however, where the plaintiffs are faced with so many witnesses and so much material and genuinely wish to use the document imaging system for the purpose of throwing up onto a screen sundry documents during the hearing, it is difficult for the Court to suggest that the plaintiffs do not have a legitimate and justifiable forensic interest in approaching the hearing in that way. 71    On any one’s view this case is going to take a considerable time. It is important for the Court to keep in mind the desire of the plaintiffs to have a paperless hearing to the extent possible. The Court is not able currently to know, because these are matters for the parties, what are the respective resources on the two sides of the bar table. Where however, either party puts forward a desire to use the technology set up by the Court for dealing with certain types of litigation appropriate for that purpose, to my mind the approach which the Court should take, is to accept that the Technology Court should be used and generally in the way discussed today, that the short minutes of order put forward by the plaintiffs, but as varied as appropriate following further discussion inter partes, be made. 72    There are number of terms in those orders which require to be adjusted. 73    Paragraph 1.1 is inappropriate because the plaintiffs have not elected to use the Technology Court for the hearing of these proceedings. They have opposed the use of that court but as I have endeavoured to make plain, I have rather on close examination, understood their opposition to be to what occurs within the courtroom, as opposed to the use of the courtroom itself. In short, as I understand it, the defendants are generally content to accept that many facilities are available and of use for the purposes of the conduct of this litigation in that courtroom. As I have understood it, the defendants essential general opposition to use of the Technology Court, has been to the concept of, in this case, a “paperless” hearing. 74 I would not wish it to be thought for a moment that during the course of the hearing I will not be reaching for hard copy quite often and marking it up, as counsel for the parties do, as for example where the witness is taken to particular sections of documents. I certainly intend quite often to do that. 75 For those reasons I intend to make such directions, or if necessary make such orders, as are generally outlined in the short minutes of order sought to be propounded by the plaintiffs. To my observations the ‘electronic court book’ should be a court book which will contain the documents which will have been imaged, as well as witness statements, an agreed bundle, overview submissions, chronologies and ancillary materials 76 At best the use of the Technology Court with an electronic ‘court and library book’, and use of the sundry facilities to which I have referred, may lead to a considerable shortening of the court time, currently estimated to take at least a year. 77 At worst, the use of the Technology Court will still have substantial advantages to all parties, in terms of the special facilities capable of being used. 78 In those circumstances, and having regard to the inherent jurisdiction of the Court to exercise its judicial function according to law and in an effective manner to which I first referred, and having regard to Pt 1 of the Supreme Court Rules, and having regard to the obligation imposed upon the Court to actively manage cases to achieve that objective, to my mind these proceedings are appropriate to be heard in the Technology Court, and I propose to order accordingly.

I certify that paragraphs 1-78
are a true copy of the revised reasons for judgment
herein of The Hon. Justice Einstein

________________________
Susan Piggott
Associate

4 May 2000

Last Modified: 06/13/2002