Mann v Cockburn Power Boats Association (Inc)
[2005] WASC 86
•22 APRIL 2005
| JURISDICTION | : | SUPREME COURT OF WESTERN AUSTRALIA IN CHAMBERS |
| CITATION | : | MANN -v- COCKBURN POWER BOATS ASSOCIATION (INC) [2005] WASC 86 |
| CORAM | : | COMMISSIONER MCKERRACHER QC |
| HEARD | : 22 APRIL 2005 | ||
| DELIVERED | : 22 APRIL 2005 | ||
| FILE NO/S |
| ||
| BETWEEN | : FREDERICK BRUNO MANN |
Plaintiff
AND
COCKBURN POWER BOATS ASSOCIATION
(INC)Defendant
Catchwords:
Inspection of documents in pleading or affidavit - Documents not individually nominated - Described compendiously - Cheques - Accounts - Discretion
Legislation:
Supreme Court Rules, O 26 r 8, r 9
Result:
Order made to produce documents for inspection
[2005] WASC 86
Category: B
Representation:
Counsel:
| Plaintiff | : | Mr J G Kitto |
| Defendant | : | Mr J C W Skinner |
Solicitors:
| Plaintiff | : | Kitto & Kitto |
| Defendant | : | Jackson McDonald |
Case(s) referred to in judgment(s):
ACN 007 528 207 Pty Ltd v Cameron [2002] SASC 144
Australian Securities and Investments Commission v Knightsbridge Managed
Funds Ltd & Anor [2001] WASC 177
Century Drilling Ltd v Gerling Australia Insurance Co Pty Ltd [2004] QSC 120
Dubai Bank Ltd v Galadari & Ors (No 2) [1992] All ER 738
King v GIO Australia Holdings Ltd (2001) FCA 1487
Smith v Harris (1883) 48 LT 869
Case(s) also cited:
Nil
[2005] WASC 86
COMMISSIONER MCKERRACHER QC
COMMISSIONER MCKERRACHER QC: This is the plaintiff's application to compel the defendants to produce documents pursuant to O 26 r 8 of the Supreme Court Rules. Order 26 r 8 of the Supreme Court Rules, by subrule (2), provides:
"Any party to a cause or matter shall be entitled at any time to serve a notice on any other party in whose pleadings or affidavits reference is made to any document requiring him to produce that document for inspection by the party giving the notice."
2 The obligation to produce such documents is set out in subrule (3),
and in the event that documents are not made available for inspection, there is a power under r 9 under which the court may make an order compelling inspection.
3 In the statement of claim the plaintiff alleges, in essence, relevantly
to this application, a breach of contract by the defendant whose management committee has incurred substantial expenditure which the plaintiff contends it is not authorised to do. He seeks injunctive and declaratory relief.
4 In the course of preparation for interlocutory injunctions yet to be
heard, the parties have exchanged affidavits. One of those affidavits is an affidavit of James Thomas Dabelstein sworn on 4 March 2005 in which the following two paragraphs appear. Paragraph 10:
"The defendant operates a bank account in the name of Cockburn Power Boat Association (Inc) at the Hilton branch of the Commonwealth Bank, BSB 066-144, account number 0090-1112 ('the club account'). Cheques written against the club account require only two of the signatures of the secretary, the commodore, vice-commodore or the first rear commodore."
and par 11:
"Accounts are paid for when they fall due by the secretary from the club account. Each month the secretary prepares a balance sheet and profit and loss statement and submits them to the management committee for review and ratif ication."
5 The plaintiff contends that these paragraphs make reference, for the
purposes of the rule, to the following documents: cheques written by the defendant on the stated account; the accounts paid by the secretary of the
[2005] WASC 86
COMMISSIONER MCKERRACHER QC
defendant; and monthly balance sheets and profit and loss statements
prepared by the defendant's secretary.6 In the application the plaintiff has confined its relief to seeking
cheques and accounts in respect of the 2004 calendar year only. The plaintiff has also indicated that he would accommodate an order in relation to cheques by examining or obtaining copies of cheque butts rather than requiring the defendant to recall the cheques which have been written through that year. The defendant has agreed that the balance sheet and profit and loss statements will be produced without conceding any obligation to do so.
7 The defendant has otherwise resisted the production and submits that
O 26 r 8 has no relevant application. The defendant's submission is that the paragraphs do not contain any direct reference to or reliance upon any of the documents sought, and production of the documents is therefore not within the scope of the rule.
8 The primary submission of the defendant is that the affidavit does no
more than describe a procedure in relation to the financial documents by reference to the documents in a general sense as part of that procedure. The defendant says, by analogy, that a reference in an affidavit to an officer being authorised to send correspondence would not entitle an opponent to enforce a request to examine all correspondence.
9 The plaintiff concedes that submission but stresses that this is a
narrow class of documents in a specific time frame and that they are
documents which lie at the heart of this aspect of the case.10 The defendant submits that the rationale of O 26 r 8(2) is that a party
is entitled to production of a document that is relied upon in an affidavit, so that the party is in the same position as if the document relied upon had been set out fully in the affidavit: Century Drilling Ltd v Gerling Australia Insurance Co Pty Ltd [2004] QSC 120 and ACN 007 528 207 Pty Ltd v Cameron [2002] SASC 144. The defendant points out that the documents referred to would never have been set out in full in the affidavit or pleading and observes, correctly, in my view, that one of the central purposes of the rule is to enable inspection of a document which, for reasons of expediency, has been alluded to in the pleadings or affidavit but not set out in full. To this the plaintiff responds, also, I think, correctly, at least on the materials at this stage, that he will be entitled not only to inspection on discovery of these documents but also to their
[2005] WASC 86
COMMISSIONER MCKERRACHER QC
particularisation by way of further and better particulars of the statement
of claim.11 Subject only to a qualification I will make about the word
"accounts", in my view there has been in each instance a "compendious reference to a class of documents". A similar expression (and its usage in Seaman on Civil Procedure at 26.8.1) appears in an English decision which also explored the meaning of "refers to" where it appeared in the then English equivalent of our Supreme Court Rules.
12 In Smith v Harris (1883) 48 LT 869 a notice was served on a party seeking production of documents referred to in the pleadings as invoices, letters, bill heads. The application was resisted by the plaintiff on the basis that the rule operated only on documents which were expressly identified in the pleadings or were particularly described. Chitty J did not accept that argument as it related to the invoices, letters and bill heads and held:
"It is said, that that is only a general reference to documents, but in my opinion, that is both a general reference and also a special reference to each and every bill head and each and every letter; because the plaintiff, instead of setting out each document separately, refers to them compendiously, but that is no reason why inspection should not be allowed."
13 There is no reason to believe that Smith v Harris (supra) is not still good authority and I propose to follow it in relation to the reference to cheques. I would also have done so for the balance sheet and profit and loss statements but it is unnecessary as they are being voluntarily produced without admission that they need to be.
14 The reference to accounts, however, gives me more concern although
this issue was not raised by the parties. It appears that I am required to infer that the "accounts" are all documents. In Dubai Bank Ltd v Galadari & Ors (No 2) [1992] All ER 738 the Court of Appeal held:
"Rules of court substantially corresponding with order 24 rule 10 and the rules ancillary to it have been in force for over 100 years. Lindley LJ in Quilter v Heatly (1883) 23 Ch D 42 at 50 drew a distinction between these rules and the general rules as to the discovery of documents. He said: 'These rules were evidently intended to give the opposite party the same advantage as if the documents referred to had been fully set out in the pleadings.' "
[2005] WASC 86
COMMISSIONER MCKERRACHER QC
Their Lordships referred to the judgment of Chitty J and Smith v Harris which I have cited above and then said:
"The problem arises in applying the approach of Lindley LJ in Quilter v Heatly in a case where although the assertion made in the affidavit or the pleading does not specifically mention a document or class of documents it gives the reader strong grounds, perhaps even sure grounds, for supposing that a document must exist."
16 More recently the Federal Court of Australia in King v GIO Australia Holdings Ltd (2001) FCA 1487 considered the issue of inference. Moore J held in relation to categories of documents in that case, that there had not been reference to a document other than perhaps an implied reference. In relation to a reference to information in the term of forecasts and budgets of future revenues, expenditures and profits, his Honour said that one would suppose that it is, in the context of pleadings, almost certainly the case that such information would have been contained in documents. However, the pleading did not in the view of the court involve a reference to a document in the way the authorities contemplate.
17 In the present application Mr Kitto for the plaintiff submits that no
inference that the accounts are documentary is required because I should take into account the GST legislation which generally stipulates that accounts for goods and services be in writing. I will examine that shortly. Mr Kitto also points to the second sentence in par 11 which refers to the submission of papers to the committee. However, I tend to read that sentence as referring to the submission of the balance sheet and profit and loss statements to the committee rather than the accounts. It may well be both but I think it is equivocal.
18 The revised second edition of the Macquarie Dictionary relevantly
defines an account as being "A bill as for service rendered or goods purchased." But it technically remains possible that some of the accounts were oral or by custom.
19 As to the GST legislation, I accept that there is an obligation under
the GST legislation to raise tax invoices which are effectively accounts. The legislation known as the GST Act and more fully a New Tax System (Goods and Services Tax) Act 1999 sets out requirements in that regard and the commissioner for taxation has published extensive rulings dealing with the content and context of tax invoices specifying the requirement for use of tax invoices in goods and services taxes.
[2005] WASC 86
COMMISSIONER MCKERRACHER QC
20 I also accept that bar supplies and utilities accounts referred to in
par 12 of the affidavit are very likely to be documentary. I note that the defendant has not relied on any submission that accounts where used in the affidavit were not necessarily documents.
21 Does this mean that accounts where referred to in the affidavit does
not refer to documents? I do not think so. It is inconceivable that none of the accounts were documents and that all of the payees were ignoring the GST Act.
22 If the word in the paragraph had been "invoices" or "bills" I would
have had no hesitation in concluding, as in Smith v Harris above that they were documents. Nevertheless it seems to me, on applying some commonsense, that the word "accounts" for all the reasons expressed above does refer to documents.
23 Finally, it is easy to overlook in the context of an application such as
this the word "may" where it appears in r 9. As Owen J observed in Australian Securities and Investments Commission v Knightsbridge Managed Funds Ltd & Anor [2001] WASC 177:
"Neither discovery nor inspection in this context is an absolute right. Order 26 r 9 provides that the Court 'may' order inspection. It is a matter of discretion."
His Honour said:
"The discretion falls to be exercised judicially and according to established principles stemming from the authorities and from the Rules. Nonetheless, the discretionary aspect should not be overlooked. The factors governing the exercise of the discretion include the following:
(1) regard must be had to the nature of the proceedings",
and a little further down:
"(2)
there is a strong pointer to the correct approach in O 26 r 11: an order for production of documents should be made only if it is necessary for disposing fairly of the case or for saving costs;
(3)
it is necessary to identify and bear in mind the precise nature of the relief sought and the issues that have been joined in the proceedings;
[2005] WASC 86
COMMISSIONER MCKERRACHER QC
(4) the power exists to limit discovery in the way set out in
O 26 r 7(3)."
24 In that case his Honour held that it would not be in the interests of
justice to allow the main proceedings under which that application was pursued, to become a wide-ranging inquiry into the broad affairs of the various parties and the various loan arrangements.
In my view relevant discretionary considerations in the present instance include the facts that:
(1) the documents are by no means peripheral but rather
appear to be central to the first aspect of the claim;(2) steps have been taken already to minimise inconvenience to the defendant in production of the cheques as an examination of the cheque butts has been accepted in the alternative to production of the cheques; in relation to both cheques and accounts the time frame has been confined only to the calendar year 2004; (3) it appears that the defendant has an efficient recording system and there is no suggestion of oppression or fishing raised by the defendant; and (4) pleadings are closed and discovery would ordinarily be due reasonably soon in any event. Discovery has been suspended or deferred pending determination of the plaintiff's interlocutory applications.
26 If the plaintiff is entitled under the Rules to this relief, it should have
it in the absence of good reason to the contrary. I am unable to discern any such good reason and accordingly I will make the orders pursuant to O 26 r 9 that the defendant's cheque butts and accounts for the calendar year 2004 be produced for inspection. I will hear counsel as to the detail of the orders and costs.
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