Lipperts v Ceerose Pty Ltd

[2019] NSWSC 1755

Supreme Court

New South Wales

Medium Neutral Citation:	Lipperts v Ceerose Pty Ltd [2019] NSWSC 1755
Hearing dates:	18 November 2019
Decision date:	13 December 2019
Jurisdiction:	Common Law
Before:	Button J
Decision:	(1) The notice of motion of 19 Lyons Road Pty Limited filed on 11 September 2019 is dismissed. (2) Costs reserved.
Catchwords:	CIVIL PROCEDURE — Subpoenas — Application to set aside by motion of recipient — Whether legitimate forensic purpose demonstrated — Whether subpoena oppressively imprecise — Motion dismissed
Legislation Cited:	Civil Liability (Third Party Claims Against Insurers) Act 2017 (NSW) Civil Procedure Act 2005 (NSW)
Cases Cited:	Cobin Ann Moore v Richard McKiernan [2017] NSWSC 1520 Commonwealth Bank of Australia v ACN 076 848 112 Pty Limited [2015] NSWSC 666 Energize Fitness Pty Ltd v Vero Insurance Limited [2012] NSWCA 213
Category:	Procedural and other rulings
Parties:	19 Lyons Road Pty Ltd (Applicant) Ceerose Pty Ltd (Respondent)
Representation:	Counsel: A Joseph (Applicant) D A Lloyd (Respondent)   Solicitors: Hickey Law (Applicant) McCabe Curwood (Respondent)
File Number(s):	2018/88751

Judgment

Introduction

1. This is an application by way of notice of motion that came before me recently in the Duty List seeking orders to set aside a subpoena, on the grounds that it discloses no legitimate forensic purpose, and also that it is oppressively imprecise.

Background

2. Because of the differing roles of various parties at different forensic stages, I shall generally refer to them by abbreviations rather than by their role on this motion.

3. The substantive plaintiff is Ms Jenny Lipperts, who commenced negligence proceedings against Ceerose Pty Ltd (Ceerose) on 20 March 2018. It was alleged that on 14 May 2015, Ms Lipperts was working as a traffic controller at a building site located at 19-25 Lyons Road, Camperdown (the premises) when she was injured by a gate that fell on her (the incident). At that time, Ceerose (the substantive defendant) was the head contractor and occupier of the premises with regard to building works, and 19 Lyons Road Pty Ltd (19 Lyons) was the owner of the premises.

4. Prior to the commencement of the substantive proceedings between the plaintiff and Ceerose, the incident was subject to a SafeWork investigation. Mr Sam McInnes was the occupier of the premises from 2012-2014. 19 Lyons was also the owner of the premises during this time (as it appears from the cross-claim). Mr McInnes was interviewed for the purposes of the investigation. He made statements about his knowledge of the unsatisfactory state of the gate during the period when he was the occupier.

5. On 18 October 2018, Ceerose filed a cross-claim against 19 Lyons, seeking damages for breach of contract and contribution or indemnity as a tortfeasor. Within its pleading, Ceerose claimed that Mr McInnes had informed 19 Lyons of earlier occasions when the gate had been dangerously dislodged, and that 19 Lyons did not take any steps, or any adequate steps, to investigate the dislodgements.

6. On 15 July 2019, the proceedings between the plaintiff and Ceerose were settled for a significant sum.

7. On 22 July 2019, Ceerose issued the subpoena in question against 19 Lyons. In a nutshell, the subpoena seeks two categories of documents: the first is documents, broadly defined, relating to the incident, and the second is all insurance policies of 19 Lyons Road Pty Ltd, as well as documents relating to any claims for insurance regarding the incident.

8. On 11 September 2019, 19 Lyons (the applicant before me) filed a notice of motion resisting the subpoena issued by Ceerose (the respondent thereto).

Submissions in resistance, and consideration thereof

9. Because of the helpful degree of refinement achieved at the hearing by both parties, I believe that I can be concise.

Clauses 2 and 3

10. 19    Counsel for 19 Lyons submitted that to the extent that the cross-claim and the defence to the cross-claim focus on events prior to the incident in April 2015, clauses 2 and 3 of the subpoena seek documents and material that are irrelevant to the dispute between 19 Lyons and Ceerose.

11. Counsel further submitted that clauses 2 and 3 of the subpoena were imprecise and therefore oppressive. It was said that, to the extent that they seek documents “held in connection with” an injury suffered by the plaintiff and, all other materials “relating to the plaintiff’s alleged accident”, 19 Lyons is unable to determine the parameters of the material sought. It was said that such phrases are simply too nebulous, and that greater specificity is called for.

12. It was also submitted that there was no legitimate forensic purpose underpinning clauses 2 and 3. In particular, counsel submitted that the putative responses of 19 Lyons to the incident had nothing to do with the question of who may actually be responsible for it.

13. As for the second basis of resistance, in my opinion it is inevitable that a subpoena such as this must be imprecise at its borders. As Ceerose submitted, it is incapable of identifying a particular piece of paper or a particular bundle of papers. And I believe that it is incumbent upon 19 Lyons to respond to the subpoena on the one hand, with abundant caution, and including materials that could reasonably be thought to relate to the accident, or in connection with the injury; and, on the other hand, in a commonsense way.

14. In short I do not believe the clauses 2 and 3 are unclear, and thereby oppressive. Despite the readiness in discussion of Ceerose to make it more stringent, after reflection I do not consider that to be necessary.

15. As for the first argument pertaining to chronology, it is true that part of the cross-claim focuses on events leading up to the accident. But, as one would expect, its nub is surely responsibility for the accident itself. In my opinion, there is no temporal disjunction between the cross-claim and this part of the subpoena.

16. As for the third ground of resistance, it is clear from the quantum of the settlement that the injury suffered by the plaintiff was a significant one. It is the kind of injury that one would surely expect the corporate owner of premises upon which it is said to have occurred to have responded by way of internal and external communications that are documented. I am satisfied not only that there is a legitimate forensic purpose underpinning clauses 2 and 3, but also that they do not constitute an inappropriate “fishing expedition” or speculative “trawling of the lake”.

Clause 4

17. Clause 4 seeks all insurance policies held by 19 Lyons as at the date of the accident. It was explained on behalf of Ceerose that two purposes underpins that proposed order.

18. The first is to determine whether it could be that 19 Lyons had in truth insured Ceerose without the knowledge of the latter; it was not disputed before me that that is not uncommon practice with regard to construction sites.

19. The second is to determine whether Ceerose may be in a position to proceed directly against any insurer of 19 Lyons, in accordance with the Civil Liability (Third Party Claims Against Insurers) Act 2017 (NSW) (the Act).

20. Through its counsel, Ceerose disavowed any legitimate forensic purpose underpinning clause 4 founded upon an effort to investigate whether 19 Lyons is “worth suing”.

21. 19 Lyons resisted this clause of the subpoena on the basis that whether Ceerose may have been insured by 19 Lyons, and whether Ceerose may be able to proceed against an insurance company rather than 19 Lyons, are not legitimate forensic purposes as between Ceerose and 19 Lyons. Reliance was placed on the decision of Ball J in Commonwealth Bank of Australia v ACN 076 848 112 Pty Limited [2015] NSWSC 666.

22. It was separately said that the proper course for Ceerose to have adopted was preliminary discovery, presumably against 19 Lyons.

23. The final point made in relation to clause 4 was that, in the context of what Ceerose seeks to find out through the subpoenaed material, only public liability insurance could be of relevance, rather than “all insurance policies”.

24. As for the first ground of resistance against clause 4, I do not accept it. Although it is true that the purposes of this part of the subpoena are in a sense “external” to the question of tortious liability pleaded in the cross-claim of Ceerose against 19 Lyons, in my opinion they are undoubtedly legitimate forensic purposes when one considers the issues thrown up by the litigation as a whole. In short, I believe that the approach of 19 Lyons to what is a legitimate forensic purpose in this context is simply too narrow. And I also believe that the judgment of Ball J is not on point: my reading of [7] thereof is that that was not a case in which some form of direct mechanisms against an insurance company was being, or was sought to be, adopted.

25. Furthermore, there is authority for the proposition that it is incumbent for an entity such as Ceerose to establish any such claim (Energize Fitness Pty Ltd v Vero Insurance Limited [2012] NSWCA 213 at [53]), including that its claim against 19 Lyons is indeed caused by any putative contract of insurance of the latter: see generally, Cobin Ann Moore v Richard McKiernan [2017] NSWSC 1520 at [45]-[47]. In my opinion, these propositions surely support the existence of a legitimate forensic purpose in these circumstances.

26. As for the second ground of resistance, without delving deeply into the Uniform Civil Procedure Rules, I think there are legitimate questions about whether preliminary discovery as to whether one of countless insurance companies may have been retained by 19 Lyons could, in truth, have been obtained against the latter.

27. And in any event, even if that alternative mode of compulsory process was available in the past to Ceerose, I think that it would be an exercise in futility, and contrary to s 56 of the Civil Procedure Act 2005 (NSW), now that the cross-claim of Ceerose has been filed and responded to by 19 Lyons, for me to insist that Ceerose somehow “go back to square one”.

28. As for the final point, I think the argument of counsel for Ceerose to the effect that a multiplicity of kinds of insurance may have been adopted by 19 Lyons that somehow capture Ceerose has force.

29. In short, I consider that clause 4 is not to be impugned successfully.

Clauses 5 and 6

30. As for clauses 5 and 6, again, legitimate forensic purpose was resisted. It was also said that there might be some sort of “commercial-in-confidence” relationship between 19 Lyons and its putative insurer that should permit the former to resist production of communications between the two of them.

31. I do not accept either of those submissions. As I have said, one can readily infer that the accident was serious, noteworthy, and concerning. I think that any communication, claim or otherwise, between 19 Lyons and any insurer with which it may have had a relationship could bear legitimate forensic fruit for Ceerose.

32. Separately, counsel for 19 Lyons could not point to any privilege in the Evidence Act 1995 (NSW) that could be relied upon in resistance to production.

Conclusion

33. In short, I do not accept any of the bases for resistance to the subpoena; I consider that each aspect of it has at least one legitimate forensic purpose; I do not believe that it is oppressively unclear; no privilege has been established; and accordingly it will not be set aside, or otherwise interrupted, by me.

Costs

34. At the request of the parties, costs will be reserved. In accordance with the above analysis, my initial and tentative thought – for the benefit of the parties only – is that the costs of Ceerose of the proceedings before me should be paid by 19 Lyons on the ordinary basis.

35. If that initial thought is promptly indicated by email by either party to be wrong, my Associate will be in touch with both counsel shortly to set out my proposed timetable for the provision of very concise written submissions, so that the question of costs can be resolved in Chambers.

Orders

36. For the foregoing reasons I make the following orders:

1. The notice of motion of 19 Lyons Road Pty Limited filed on 11 September 2019 is dismissed.

2. Costs reserved.

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