Kaji Australia Pty Ltd v Glover (No 2) - [2018] NSWSC 414

Supreme Court

New South Wales

Medium Neutral Citation: Kaji Australia Pty Ltd v Glover (No. 2) [2018] NSWSC 414
Hearing dates: 28 February 2018 & 8 March 2018
Date of orders: 09 April 2018
Decision date: 09 April 2018
Jurisdiction: Common Law
Before: Davies J
Decision:
The defendant/cross-claimant’s notice of motion filed 15 February 2018 is dismissed.

Catchwords: CIVIL PROCEDURE - discovery - affidavit of documents - form and contents - further and better discovery - whether reasonable search undertaken – application to cross-examine deponent on affidavit of discovery – where further affidavit provided – subpoena to be issued by deponent in relation to documents formerly in his possession - challenge to deponent’s credibility – order for cross-examination refused
Legislation Cited: Australian Consumer Law (Cth)
Australian Securities and Investments Commission Act 2001 (Cth)
Fair Trading Act 1987 (Cth)
Cases Cited: Dai v Zhu [2013] NSWCA 412
Preston v Star City Pty Ltd [2007] NSWSC 293
Proctor & Gamble v Medical Research [2001] NSWSC 183
Texts Cited: Nil
Category: Procedural and other rulings
Parties: Kaji Australia Pty Ltd (First Plaintiff)
William Bradley Webster (Second Plaintiff)
Johann Benson Glover (Defendant/Cross-Claimant)
Mercia Financial Solutions Pty Ltd (Third Cross-Defendant)
Richard Nicholson (Fourth Cross-Defendant)
Rodney Shields (Fifth Cross-Defendant)
Representation:
Counsel:
J McVittie (Plaintiffs)
R Newell (Defendant/Cross-Claimant)
D Lloyd (Third and Fourth Cross-Defendants)
R Shields (Fifth Cross-Defendant)
Solicitors:
Shields Lawyers (Plaintiffs)
L. C. Muriniti & Associates (Defendant/Cross-Claimant)
DLA Piper Australia (Third and Fourth Cross-Defendants)
Self-represented (Fifth Cross-Defendant)

File Number(s): 2014/105767
Publication restriction: Nil

Judgment

The cross-claimant complains about the discovery provided by the third and fourth cross-defendants. He seeks, first, an order that the fourth cross-defendant, who is also a director of the third cross-defendant, be ordered to attend Court to be cross-examined in relation to his affidavit verifying discovery. Alternatively, he seeks an order that the fourth cross-defendant be ordered to swear, file and serve an affidavit deposing to the facts and circumstances pursuant to which he claims the third cross-defendant does not have its file relating to the cross-claimant, and the circumstances surrounding the disposition of the file. Finally, and alternatively, he seeks an order that he be given leave to serve on the fourth cross-defendant interrogatories in relation to the discovery given by him and the third cross-defendant.

Background

In 2004 the cross-claimant advanced money to a friend, John Lippits. To do that, the cross-claimant sold shares and incurred a capital gains tax liability of $56,000 which he could not pay.
The ATO commenced proceedings against the cross-claimant. It obtained judgment against him in February 2009 and served a bankruptcy notice on him in January 2010. A creditor’s petition was filed and served in August 2010.
According to the cross-claim the cross-claimant was endeavouring to obtain a loan to pay the ATO debt. It appears that Mr Lippits may have been involved also. At some point the third and fourth cross-defendants were engaged as finance or mortgage brokers to obtain a loan for the cross-claimant.
The cross-claimant alleges that the third and fourth…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2018] NSWSC 414
Decision Date: 09 April 2018

CaseChat Overview and Summary

The defendants in the Federal Court of Australia were Kaji Australia Pty Ltd, and the plaintiffs were Glover and another. The plaintiffs sought an order for the defendants to provide further and better discovery of documents, claiming the defendants had failed to undertake a reasonable search for relevant documents. The plaintiffs also sought to cross-examine the deponent on the affidavit of discovery and to subpoena the deponent to provide documents previously in their possession. The defendants argued that the plaintiffs had not shown a reasonable search had not been undertaken, and that the deponent’s credibility could not be challenged.

The court had to determine whether the plaintiffs had made out a sufficient case for the defendants to provide further and better discovery of documents. The court also had to determine whether the plaintiffs were entitled to cross-examine the deponent on the affidavit of discovery and to subpoena the deponent to provide documents formerly in their possession. The court had to assess whether the plaintiffs had established a proper basis for challenging the deponent’s credibility. The court considered the nature and extent of the search undertaken by the defendants, the form and content of the affidavit of documents, and whether the plaintiffs had established grounds for questioning the deponent’s credibility.

The court found that the plaintiffs had not established that the defendants had failed to undertake a reasonable search for documents. The affidavit of documents provided by the defendants was deemed to be in the appropriate form, and the plaintiffs had not shown that the deponent was not credible. The court held that the plaintiffs were not entitled to cross-examine the deponent on the affidavit of discovery or to subpoena the deponent to provide documents formerly in their possession. The court found that the plaintiffs had not demonstrated a proper basis for challenging the deponent’s credibility.

The court dismissed the plaintiffs’ application for further and better discovery, for cross-examination of the deponent, and for the issuance of a subpoena to the deponent. The court did not make any orders for costs.

Orders