Lee v Australian Executor Trustees Limited as trustee of the Estate of the Late Ronald William Lee
[2020] WASC 309
•26 AUGUST 2020
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
CITATION: LEE -v- AUSTRALIAN EXECUTOR TRUSTEES LIMITED AS TRUSTEE OF THE ESTATE OF THE LATE RONALD WILLIAM LEE [2020] WASC 309
CORAM: REGISTRAR WHITBY
HEARD: ON THE PAPERS
DELIVERED : 26 AUGUST 2020
PUBLISHED : 26 AUGUST 2020
FILE NO/S: CIV 2856 of 2018
BETWEEN: JOHN ANTHONY CAMPBELL LEE
Plaintiff
AND
AUSTRALIAN EXECUTOR TRUSTEES LIMITED AS TRUSTEE OF THE ESTATE OF THE LATE RONALD WILLIAM LEE
First Defendant
FAY EILEEN LEE
Second Defendant
FAY EILEEN LEE
Plaintiff by counterclaim
AND
JOHN ANTHONY CAMPBELL LEE
Defendant by counterclaim
Catchwords:
Application by non-parties for access to witness outlines - O 67 r 9(3), r 9(4) Rules of the Supreme Court 1971 (WA) - Witness outlines not considered by the court - Must be a good reason to grant access - No good reason established
Legislation:
Administration Act 1903 (WA)
Rules of the Supreme Court 1971 (WA), O 67 r 9(3), O 67 r 9(4)
Trustees Act 1962 (WA)
Result:
Non-parties' application for access to witness outlines dismissed
Category: B
Representation:
Original Action
Counsel:
| Plaintiff | : | No appearance |
| First Defendant | : | No appearance |
| Second Defendant | : | No appearance |
| Non-party Applicant | : | No appearance |
Solicitors:
| Plaintiff | : | Croftbridge |
| First Defendant | : | Gilbert + Tobin |
| Second Defendant | : | In person |
| Non-party Applicant | : | Bennett + Co |
Counterclaim
Counsel:
| Plaintiff by counterclaim | : | No appearance |
| Defendant by counterclaim | : | No appearance |
Solicitors:
| Plaintiff by counterclaim | : | In person |
| Defendant by counterclaim | : | Croftbridge |
Case(s) referred to in decision(s):
Lee v Australian Executors Trustees Ltd as trustee of the estate of the late Ronald William Lee [2019] WASC 96
Russell v Lee Holdings Pty Ltd [2017] WASC 283
REGISTRAR WHITBY:
As counsel have in their submissions, and with no disrespect intended, I will refer to the parties by their first names.
This is an application dated 26 May 2020 by Ms Shana Russell and Ms Nerida Puangkham (Shana and Nerida) pursuant to O 67B r 9(3), alternatively r 9(4), of the Rules of the Supreme Court 1971 (WA) (RSC) for access to the following documents filed in this action:
(a)witness outlines of the plaintiff (John) filed on 21 February 2020 (of which there are two);
(b)witness outline of the second defendant (Fay) filed on 14 April 2020; and
(c)any subsequent witness outline filed in the proceedings
(collectively witness outlines).
John opposes the application. Fay adopts the position of John.
The first defendant abides by the decision of the court on the application.
I have considered the following documents in determining the application:
(a)Letter dated 26 May 2020 from Bennett + Co constituting the application;
(b)Plaintiff's Submissions in opposition to the non‑parties' application for access to documents dated 13 July 2020; and
(c)Applicants' Reply Submissions dated 24 July 2020.
Background
John, Shana and Nerida are the children of the late Ronald William Lee (Ron) and Fay.
Ron died on 26 July 2016.
Ron executed a will on 5 June 2008 appointing Fay as the executor. The will made no disposition of any of Ron's assets.
By a grant of letters of administration (with the will annexed) dated 24 April 2018, the first defendant, Australian Executor Trustees (AET), was appointed administrator of Ron's estate.
Ron owned a number of farming properties (collectively, the Farm). AET is currently the registered proprietor of the Farm.
Shana and Nerida are beneficiaries of Ron's estate under the Administration Act 1903 (WA).
In these proceedings, John pleads that:
(a)from 1972 or 1973 until his death, Ron orally represented to him on many occasions that one day the Farm and improvements thereon would be his or would be his when Ron died;[1]
(b)he was induced by and relied on those representations to his detriment;[2] and
(c)he has an equitable interest the Farm.
[1] Writ of Summons – indorsement of claim dated 25 October 2018, par 9.
[2] Writ of Summons – indorsement of Claim dated 25 October 2018, par 10.
John seeks an order that the Farm is held by AET on trust for him.
In addition, Fay seeks an order that she is the beneficial owner of 50% of the Farm by way of constructive trust.
AET denies both John and Fay's claims against Ron's estate.
Shana and Nerida previously filed an application to be joined as defendants to these proceedings. That application was dismissed on 28 March 2019.[3] However, as part of that application, Shana and Nerida were granted access to pleadings filed in these proceedings pursuant to O 67B RSC.
[3] Lee v Australian Executors Trustees Ltd as trustee of the estate of the late Ronald William Lee [2019] WASC 96.
This proceeding is currently listed for a ten day trial before the Honourable Justice Kenneth Martin commencing on 12 October 2020.
Shana and Nerida have commenced proceedings against John and Fay in COR 227 of 2017 (Oppression Proceedings).
In the Oppression Proceedings, Shana and Nerida plead that:
(a)Lee Bros Pty Ltd (Lee Bros) was a former subsidiary of the family company Lee Holdings Pty Ltd (Lee Holdings);
(b)Lee Bros issued shares in July 2016 which had the effect of diluting Lee Holdings' interest in Lee Bros from over 98% to less than 1% (New Share Issue);[4]
(c)the New Share Issue was conducted for an improper purpose, being to divert the opportunity to subscribe for the new shares in Lee Bros from Lee Holdings to John and Fay; and
(d)they are entitled to relief from oppression as shareholders, and a winding up of Lee Holdings.
[4] See reasons for decision in Russell v Lee Holdings Pty Ltd [2017] WASC 283 [10] – [14] (K Martin J).
In the Oppression Proceedings, John denies that the New Share Issue was for an improper purpose and asserts that the New Share Issue was, in fact, for several purposes including to secure his services as a director of Lee Bros for an extended period.[5]
[5] Lee v Australian Executors Trustees Ltd as trustee of the estate of the late Ronald William Lee [17].
Shana and Nerida's grounds in support of the application
Shana and Nerida make this application for access on the following grounds:
(a)Shana and Nerida have a legitimate interest in the administration of justice in these proceedings in their capacities as beneficiaries of Ron's estate. The decision of the court in these proceedings will impact on the assets that are available for distribution to them as beneficiaries;
(b)Shana and Nerida seek information about the evidence upon which John and Fay seek to rely in these proceedings because there is significant factual overlap between these proceedings and the Oppression Proceeding and therefore, there is a risk of inconsistent factual findings being made by the court;
(c)the intended evidence in these proceedings may be material to the determination of the Oppression Proceedings;
(d)issues of credibility are central to the determination of the claims in these proceedings and to the claims in the Oppression Proceedings;
(e)where Shana and Nerida have been refused leave to be joined as defendants to these proceedings, they ought to be permitted access to the witness outlines so they can fully ventilate all relevant matters before the court in the Oppression Proceedings;
(f)as beneficiaries of Ron's estate, Shana and Nerida may have evidence which is relevant in these proceedings;
(g)AET has determined not to adduce evidence from Shana and Nerida in this proceeding. Given AET is not appraised of the family history, it does not know whether John and/or Fay's evidence is fabricated. Shana and Nerida need to have access to the witness outlines in order to determine if they have any relevant evidence;
(h)AET has refused to give Shana and Nerida access to the witness outlines on the basis that to do so would breach the Harman obligation not to disclose information and documents obtained in these proceedings for a collateral purpose, even if that purpose is for the administration of Ron's estate;
(i)granting Shana and Nerida access to the witness outlines may avoid an application by them against AET pursuant to s 94 of the Trustees Act 1962 (WA) (Trustees Act). If these proceedings are determined in favour of either John or Fay and Shana and Nerida form the view that AET has failed to lead evidence which is within Shana and Nerida's knowledge that would contradict the claims made by John and/or Fay, then Shana and Nerida may commence proceedings against AET;
(j)in allowing Shana and Nerida access to the witness outlines, the potential for further disputation between the parties will be minimised;
(k)since the filing of the application, a new matter has arisen that constitutes a good reason for Shana and Nerida to have access to the witness outlines, that being:
a.at a mediation conference on 26 June 2020, John, Fay and AET reached an in‑principle agreement to settle all claims in these proceedings. The consent of Shana and Nerida to the proposed settlement terms is sought. In assessing whether or not to provide their consent to the proposed settlement terms, Shana and Nerida are required to have access to the witness outlines in order to form a view of the relative strengths and weaknesses of John and Fay's claims in these proceedings; and
b.subsequently, AET has made a separate application pursuant to the Trustees Act – in CIV 1780 of 2020 – for directions in relation to the proposed settlement of these proceedings (Directions Proceedings). Shana and Nerida are defendants in the Directions Proceedings. It would be unfair to require them to conduct any defence in the Directions Proceedings without access to the same information available to the court, AET, John and Fay in these proceedings (that is the witness outlines).
John's grounds for objection to the application
John submits that the application ought be refused for the following reasons:
(a)AET is a professional administrator capable of representing the interests of all of the beneficiaries of Ron's estate in these proceedings - whether Shana and Nerida's input on the issues in dispute is required is a matter for AET;
(b)the Honourable Justice Kenneth Martin will try both these proceedings and the Oppression Proceeding. The issues are clearly defined on the pleadings in these proceedings (pleadings to which Shana and Nerida have access) and evidence must be led that is consistent with those pleadings. The prospect of his Honour making inconsistent findings is far‑fetched and fanciful;
(c)Supreme Court Consolidated Practice Direction 4.1.2.2 provides:
a.The content of the witness outlines served pursuant to the order of the court is subject to the same implied undertaking as to confidentiality as applies to a document produced upon discovery;
b.No person may use part of the contents of any witness outline for the purposes of cross‑examination of the person providing the witness outline or any other person without leave of the trial judge.
(d)Shana and Nerida, not being parties to this proceeding, are not bound by this practice direction. Therefore, if access if granted issues may arise as to the use of the witness outlines;
(e)witness outlines are not intended to be the proposed evidence in chief of each witness. Therefore, the forensic utility of witness outlines to Shana and Nerida in the Oppression Proceedings is not a good reason to grant access;
(f)AET has chosen not to file witness outlines of Shana and Nerida in these proceedings. AET is not precluded from obtaining instructions from Shana and Nerida on the basis of the Harman principle as it could obtain instructions from them on the basis of the pleadings (to which Shana and Nerida have already been granted access); and
(g)Shana and Nerida have not made any application to have the trials of this proceeding and the Oppression Proceeding listed together.
Fay adopts the position of John.
Applicable Legal Principles
O 67Br 9 RSC provides:
(1)This rule applies if an application for permission is made in writing to the Court under rule 11.
(2)This rule must be read with rule 13.
(3)The Court must give permission if satisfied -
(a)the application –
i.relates to information or a record or other thing that was considered by the Court in the proceeding to which the application relates; or
ii.relates to the transcript of the whole or a part of a hearing in that proceeding that the applicant was entitled to attend; and
(b)the application does not relate to an audio or audio‑visual recording of a hearing in that proceeding; and
(c)the application relates to information or a record or other thing that was considered by the Court in that proceeding but was not admitted into evidence or was struck out – that giving permission would not prejudice or adversely affect any person; and
(d)that giving permission would not breach –
i.Any legislation; or
ii.An order made by a court in Australia; and
(e)the arrangements necessary to give the applicant access would not –
i.be unreasonably expensive or time consuming for the Court or a party; or
ii.unduly impede the efficient conduct of the proceeding; and
(f)there is no other good reason to refuse the application.
(4)If the application does not relate to information or other thing referred to in subrule 3(a) or to a recording referred to in subrule 3(b), the Court may give permission if satisfied -
(a)as to the matters referred to in subrule 3(d) to (f); and
(b)there is a good reason to do so.
The witness outlines have not been yet been considered by the court in these proceedings. This is a requirement in order for the request for access to be granted pursuant to O 67B r 9(3) RSC. Therefore, the application falls to be considered pursuant to O 67B r 9(4) RSC.
In order for access to be granted pursuant to O 67B r 9(4), not only must there be no good reason to refuse the application, there is a positive obligation on Shana and Nerida to satisfy the court that there is a good reason to permit access to the witness outlines.
Given Shana and Nerida must satisfy the court that there is a good reason to grant access to the witness outlines, I will determine this issue at the outset. It is only if I am satisfied that there is a good reason to grant access that I then need to consider whether there is an overriding good reason to refuse access. In the absence of a good reason to permit access to the witness outlines, the application must be refused.
Is there a good reason to grant access to the witness outlines?
I have previously made a finding (as Acting Master) that there may be overlapping factual issues and issues as to credibility of witnesses in these proceedings and the Oppression Proceedings. It was for these reasons that I granted access Shana and Nerida access to the pleadings in these proceedings.[6]
[6] Lee v Australian Executors Trustees Ltd as trustee of the estate of the late Ronald William Lee [64].
I have also previously held that, although there may be factual overlap and issues of credibility:
(a)Shana and Nerida do not hold any proprietary interest in the Farm which means that the trial judge is not required to consider their interests by virtue of their status as beneficiaries of Ron's estate;[7] and
(b)AET is a professional administrator who was appointed as a result of action commenced by Shana and Nerida. Shana and Nerida, as beneficiaries of Ron's estate, have rights to seek review of the administrator's acts omissions and decisions pursuant to s 94 of the Trustees Act 1962 (WA).[8]
[7] Lee v Australian Executors Trustees Ltd as trustee of the estate of the late Ronald William Lee [53].
[8] Lee v Australian Executors Trustees Ltd as trustee of the estate of the late Ronald William Lee [55].
Given that AET has elected not to adduce evidence from Shana and Nerida, it follows that a professional independent party has formed the view that they do hold any evidence that is relevant to these proceedings. I do not accept that the Harman principle operates to preclude AET from obtaining relevant evidence from Shana and Nerida – the pleadings define the matters in issue and it was for that reason that Shana and Nerida were previously granted access to the pleadings. The content of the witness outlines does not determine what matters are in issue in these proceedings.
I do not agree with Shana and Nerida's submission that there is a real risk of inconsistent findings of fact and credibility between these proceedings and the Oppression Proceedings. Both actions are being heard by his Honour Justice Kenneth Martin. In addition, there are currently no orders of this court which would restrict Shana and Nerida from attending the trial in these proceedings and/or obtaining a copy of the transcript of John and Fay's evidence.
Shana and Nerida place particular reliance upon the recent proposed settlement of these proceedings and the necessity of them having access to the witness outlines in order to make a decision about consenting to that settlement or defending the Directions Proceedings. These are good reasons, they say, to permit access to the witness outlines.
I do not accept that these are good reasons for Shana and Nerida to have access to the witness outlines. It is merely a speculative assertion that they need to review the witness outlines– an assertion that can be made in the Directions Proceedings if they consider that to have merit and a real impact upon their defence of the Directions Proceedings.
Shana and Nerida have not satisfied me that there is any good reason to grant them access to the witness outlines. In the absence of a good reason to grant access, the requirements of O 67B r 9(4) have not been met. I do not need to consider whether there is no other good reason to refuse the application.
Shana and Nerida's application for access to the witness outlines is dismissed. The parties are directed to confer in relation to costs and file consent orders. In the event that consent orders cannot be agreed, each party is directed to file a minute of proposed orders.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
TG
Court Officer26 AUGUST 2020
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