Marzec v Fieldpark Pty Ltd
[2021] WASC 324
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: MARZEC -v- FIELDPARK PTY LTD [2021] WASC 324
CORAM: REGISTRAR GRIFFIN
HEARD: 17 SEPTEMBER 2021
DELIVERED : 24 SEPTEMBER 2021
PUBLISHED : 24 SEPTEMBER 2021
FILE NO/S: CIV 2028 of 2020
BETWEEN: MIROSLAW JAN MARZEC
First Plaintiff
HELMET NOMINEES PTY LTD
Second Plaintiff
KBMG PTY LTD
Third Plaintiff
AND
FIELDPARK PTY LTD
First Defendant
QUINTIS (AUSTRALIA) PTY LTD
Second Defendant
FIELDPARK PTY LTD
QUINTIS (AUSTRALIA) PTY LTD
Plaintiff by counterclaim
MIROSLAW JAN MARZEC
HELMET NOMINEES PTY LTD
KBMG PTY LTD
Defendant by counterclaim
Catchwords:
Practice and procedure - Discovery - Application to provide redacted discovery - Masking of parts or sections of discovered documents - Application for order to destroy documents discovered - Whether documents are discoverable - Whether discovered documents are confidential or commercially sensitive - Case flow management - Turns on own facts
Costs - Whether indemnity costs should be awarded on application for redaction
Legislation:
Rules of the Supreme Court 1971 (WA)
Result:
Application dismissed
Defendants to pay plaintiffs' costs of both applications, to be taxed, if not agreed
Category: B
Representation:
Counsel:
| First Plaintiff | : | P Knowles |
| Second Plaintiff | : | P Knowles |
| Third Plaintiff | : | P Knowles |
| First Defendant | : | D Weinberger |
| Second Defendant | : | D Weinberger |
| Plaintiff by counterclaim | : | D Weinberger |
| Defendant by counterclaim | : | P Knowles |
Solicitors:
| First Plaintiff | : | Piper Alderman - Sydney |
| Second Plaintiff | : | Piper Alderman - Sydney |
| Third Plaintiff | : | Piper Alderman - Sydney |
| First Defendant | : | McCabe Curwood |
| Second Defendant | : | McCabe Curwood |
| Plaintiff by counterclaim | : | McCabe Curwood |
| Defendant by counterclaim | : | Piper Alderman - Sydney |
Case(s) referred to in decision(s):
Alcoa of Australia Ltd v Apache Energy Ltd [2014] WASCA 148
Areva NC (Australia) Pty Ltd v Summit Resources (Australia) Pty Ltd [No 3] [2009] WASC 67
Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Ltd (1988) 81 ALR 397
Hearne v Street (2008) 235 CLR 125
Swansdale v Whitcrest [2010] WASCA 129
REGISTRAR GRIFFIN:
This is the defendants' application by way of chamber summons dated 1 September 2021 for leave to provide discovery of 159 documents in redacted form (Documents):
1.The Defendants/Cross-Claimants be permitted to provide discovery by providing masked or redacted copies of the documents contained in the schedule annexed [not reproduced] on the condition that an unmasked or unredacted copy of the documents be provided to the plaintiffs’ legal representatives only.
2.Such further order as the court deems fit.
3.Costs.
At the hearing of the application, the defendants' counsel sought leave to file a further application by way of amended chamber summons dated 16 September 2021 seeking orders that the plaintiffs' expert, Mr Wright, destroy the 34 documents referred to in Mr del Gallego's affidavit sworn 13 September 2021 (Unredacted Documents), provided to him by the plaintiffs' solicitors.
The plaintiffs' counsel did not oppose the grant of leave to file the further application and leave was granted.
The court is asked to rule on whether or not, and if so, in what manner, the documents should be redacted, and whether the plaintiffs' expert, Mr Wright, should be instructed to destroy the Unredacted Documents in his possession.
The documents have already been provided to the plaintiffs' solicitors in unredacted form.
It is helpful to set out orders 1 to 4 of the programming orders made on 7 September 2021. They were:
1.The defendants are to file and serve evidence on which they wish to rely by 3.00pm WST, 9 September 2021, failing which, the defendants' chamber summons dated 1 September 2021 ('Application') is dismissed.
2.Any documents on the list annexed to the Application ('Annexure') which have not been provided to the plaintiffs in redacted form prior to or as part of the defendants' evidence filed in accordance with Order 1 will not be considered at the hearing of the Application, and are permitted to be released in native and unredacted form to the plaintiffs and their independent expert in accordance with their Confidentiality Undertakings.
3.The defendant is to sort the documents in the Annexure into groups of documents which may be redacted (if such an order is made) using a standard method for each particular category.
4.The defendant is to serve the documents in their categories upon the plaintiffs and the Court (by email) by 13 September 2021.[1]
[1] Order of Registrar Griffin in Marzec v Field Park Pty Ltd (Supreme Court of Western Australia, CIV 2028/2020, 7 September 2021).
Background
This is a claim about sandalwood plantations. The plaintiffs' claim against the defendants relates to their two plantations, called Taylor's Park 6 (TP6) and Cadell.
The defendants refer to two of the original categories of discovery which were ordered on 23 February 2021 (Discovery Orders) in which they were ordered to discover:
Category 11 - documents relevant to plantation monitoring at TP6
Category 13 - documents relating to the value of each of the plaintiffs' plantations between 2018 and 2020.
The full form of the Discovery Orders is annexed to this decision.
Discovery in this matter has had a long and contentious history.
Difficulty has arisen because many of the defendants' documents are large spreadsheets. At an early stage, it was accepted by the parties, and the court, that once a large spreadsheet is converted to pdf, and, subsequently, redacted, it becomes almost unreadable.
The plaintiffs and their expert provided Confidentiality Undertakings to the defendants on or around 6 August 2021.
Those undertakings are in the following terms:
I will not use the Documents [meaning documents provided during discovery] or the contents of such Documents for any purpose other than the conduct of the Proceedings.
This undertaking does not prevent me from disclosing material which is in the public domain or comes into the public domain, unless the material comes into the public domain because of a breach of this undertaking.
I may vary this undertaking with the written consent of the Defendants.
Nothing in this undertaking removes or limits the implied undertaking of confidentiality applicable to any documents produced by a party on discovery or otherwise as part of the Court’s processes.
The defendants expressly, and properly, disclaimed any suggestion that the plaintiffs' expert may consciously improperly use documents the subject of the Confidentiality Undertakings. It was however said that the expert could not 'unknow' something he had read in the course of these proceedings.
Evidence
The defendants filed affidavits of Alistair David John Stevens sworn 9 September 2021 (Stevens Affidavit) and John Alexander Louden sworn 16 September 2021 (Louden Affidavit). The Louden Affidavit was provided to the court shortly before the hearing on 17 September 2021.
The plaintiffs filed affidavits of Martin del Gallego sworn 6 September 2021 (Del Gallego Affidavit 1) and Martin del Gallego sworn 13 September 2021 (Del Gallego Affidavit 2).
Categories of document
The defendants were ordered to provide to the court and the plaintiffs' solicitors the documents grouped into categories. The aim of this order was, assuming redaction was found to be appropriate in any given case, that a method for redacting each particular category of documents could be made, rather than having to specify the method of redaction for each of the documents.
The documents consist of 108 spreadsheets and 51 various other documents.
The defendants say that the categories of documents are:
i.Biological asset valuation model (valuation model); and
ii.Data as to the performance of each of the plantation with the Quintis estate (inventory data).
Information in both of these categories is stored in both spreadsheets and other formats.
Defendants' submissions
The defendants submit that the documents should be provided in redacted form on a number of bases.[2]
[2] Defendants' outline of submission on application for redacted discovery filed 14 September 2021 ('Defendants' submissions').
First, that parts of the documents do not correspond to categories 11 and 13 of the Discovery Orders, and are not therefore, discoverable pursuant to those orders.[3]
[3] Ibid.
Second, that the documents contain confidential information which should be protected from disclosure to the plaintiffs' expert.[4]
[4] Ibid.
The defendants' counsel accepted the proposition that material discovered is, prima facie, relevant to the issues in dispute, subject to the rider that portions of the material may be relevant.[5]
[5] Transcript of Proceedings, Marzec v Field Park Pty Ltd (Supreme Court of Western Australia, CIV 2028/2020, Registrar Griffin, 17 September 2021) 248 ('ts').
The defendants' data is contained in large spreadsheets. The spreadsheets containing valuation data, for example, contain valuation data for many plantations, some in different states from the plaintiffs' plantations, and there are over 3,500 individual investors, of which the plaintiffs are three.
The defendants proposed to provide discovery by concealing rows of data within the spreadsheets which do not relate to TP6 and Cadell (that is, by only providing information regarding the plaintiffs' plantations). As a proposal, that is not exceptional and on its face is reasonable. Difficulties have, however, arisen as will become clear.
The defendants further submit that information relating to other investors is confidential pursuant to obligations they have to those investors, and should not be disclosed to the plaintiffs, or their expert because that would breach the defendants' obligations of confidentiality to those other investors, to no purpose.[6]
[6] Ibid 249.
It is not just the data contained within the spreadsheets which the defendants seek to redact. That is because the data is applied to a customised growth model.[7]
[7] Stevens Affidavit [21].
The growth model methodology is '… confidential and commercially sensitive. The unique characteristics of the growth model methodology is a way in which Quintis differentiates itself from its competitors and provides precision with respect to measuring plantation performance.'[8]
[8] Ibid [23].
Upon enquiry of defendants' counsel, I came to understand that the growth model methodology includes various inputs unique to the defendants,[9] and also various formulas, which methodology is, apparently, embedded in the spreadsheet.
[9] Ibid [22].
Counsel further submitted that another basis for that claim for confidentiality was set out in the Stevens Affidavit at pars 26 and 27, which are to the effect that the plaintiffs' expert has consulted in the past to the defendants' main domestic competitor. The defendants' counsel submitted that the plaintiffs' expert is the 'mouthpiece' of the defendants' competitors.[10]
[10] ts 251.
I put to the defendants' counsel that the argument for redaction would be much stronger if this was truly a case of trade competitors in litigation. In response, the defendants' counsel said that this was, in essence, a case of trade competitors, likening it (in a helpful analogy) to Pepsi v Coca-Cola,[11] because the plaintiffs' expert was the mouthpiece for the defendants' main domestic competitors.
[11] Ibid 252.
With respect to redaction, and the difficulties I referred to in par 26, it will be recalled that order 2 of the programming orders for this application was that the defendants were to provide to the plaintiffs' solicitors redacted versions of the documents. This was so that the plaintiffs' solicitors could compare the redacted and unredacted versions and advise whether the redaction was acceptable to them.
The Louden Affidavit disclosed that the redaction was being done in‑house by members of the Quintis corporate office team in Perth.[12]
[12] Louden Affidavit [21] - [24].
That is significant because the Quintis team doing the redaction work was under some time pressure due to family commitments and illness, and consisted of four persons, only two of which were lawyers. Counsel submitted that the defendants' general counsel, Mr Louden, was the person 'best seized' to undertake the redaction exercise,[13] and conceded that the inclusion of other, less qualified persons '… might be a recipe for … inconsistencies and imperfections.'[14]
[13] ts 273.
[14] Ibid 272.
The defendants' counsel accepted that there were inconsistencies in the redaction exercise.[15]
[15] Ibid 254.
A number of documents are completely redacted.[16] It is not possible for the plaintiffs to comment on whether or not that redaction is acceptable. The defendants' counsel submitted that this was a product of the time pressure under which the redaction was performed and that the defendants should have time to rectify this issue, further, that there should be a margin for error in an exercise of this magnitude.[17]
[16] Del Gallego Affidavit 2 [64].
[17] ts 249 - 250.
The plaintiffs' submissions
The plaintiffs submit that first, no confidentiality has been established.[18] The evidence with respect to confidentiality was not sufficiently specific.[19] The defendants' position with respect to confidentiality (and supporting evidence) was in broad terms as to the 'confidential nature' of the information. The plaintiffs' counsel submitted that the defendants had not provided any evidence as to how confidentiality of the relevant material was preserved in the organisation.
[18] Plaintiffs' submissions on defendants' application for limitations on disclosure filed 16 September 2021 ('Plaintiffs' submissions').
[19] ts 258.
The plaintiffs submitted that the defendants would be at a forensic advantage, not having given any undertaking that they would provide the documents in redacted form to their own expert. The defendants' counsel gave this undertaking in reply so this ground of objection fell away.
The plaintiffs' counsel, in oral and written submissions, pointed to the defendants' knowledge of the identity of the plaintiffs' expert since May 2021. The defendants, although now said to be concerned about close links between the expert and their competitors, did not raise those concerns until this application was made, some five months later. The plaintiffs have expended considerable sums in engaging the expert, including a site visit in the Northern Territory. (The expert is based in Perth).
The plaintiffs did not accept the defendants' contention that this is, in essence, a case of trade rivals. It was submitted that the expert is an industry consultant, but that neither the plaintiffs nor the expert are trade competitors of the defendants.[20]
[20] Ibid 260.
The plaintiffs' counsel referred to the defendants' proper acceptance that there was no risk of the plaintiffs' expert deliberately misusing the information contained in the documents.[21] The risk, therefore, was of inadvertent disclosure. This was said to be a fanciful risk as, given the size and complexity of the spreadsheet models, it would simply not be possible for the expert to inadvertently share that information with a competitor of the defendants. As to the risk of inadvertent electronic dissemination, plaintiffs' counsel pointed to the Confidentiality Undertakings, which are enforceable, and noted that in any event, the expert is required to return all materials to the plaintiffs' solicitors.
[21] Ibid.
With respect to the Louden Affidavit, addressing the Unredacted Documents and the errors in redaction, plaintiffs' counsel submitted that there had been no communication from the defendants' solicitors regarding the reasons for any delay, and no requests for any extension of time.[22] Paragraph 26 of the Louden Affidavit reveals that Mr Louden completed the redaction of the Unredacted Documents on 10 September 2021, and sent them to the defendants' Sydney solicitors at 7:15 am WST (9:15 am EST) on that day. The plaintiffs' counsel informed me that the Unredacted Documents were not received by the plaintiffs' solicitors until 13 September 2021 (that is, the following Monday), and then it was because they were attached to an affidavit filed at court.[23]
[22] Ibid 246.
[23] Ibid 257.
A number of redaction errors are identified in Del Gallego Affidavit 2. At par 61, Mr del Gallego identifies numerous instances where information relevant to the plaintiffs' plantations was redacted from spreadsheets - clearly the opposite of what was intended. At par 62, Mr del Gallego sets out a table showing where errors have been identified - essentially, there are 17 documents identified where either information relevant to the plaintiffs' plantations has been redacted, or where information relating to other plantations has been retained. At pars 64 to 67, Mr del Gallego reviews a document which the defendants seek to redact entirely. It appears that one of the documents is a draft or duplicate of the others; but in any event, the defendants are content to produce part of it in unredacted form, but seek to completely redact the same information in the slightly different version of the document.
It was submitted in written submissions that loss on the plaintiffs' plantations cannot be assessed without reference to other plantations managed by the defendants which did not suffer irrigation loss.
The plaintiffs' counsel submitted that the defendants have put in issue whether there was any default at all in neighbouring plantations.[24] In that case, it was said, valuation data for other plantations, even if not specifically ordered, could be relevant to both liability and loss. If there was a difference in value between plantations, what caused that difference?
[24] Ibid 267.
The plaintiffs' solicitors have provided the Unredacted Documents to their expert, as they were entitled to do pursuant to the orders of 7 September 2021. The effect of that is that much of the information the defendants now seek to withhold has already been disclosed to the plaintiffs’ expert.[25] In reply, the defendants' counsel submitted that 'much' was not 'all' and that therefore there was still utility in the application.[26]
[25] Del Gallego Affidavit 2 [45].
[26] ts 254.
Principles
First, the applications should be considered in the light of the principles of positive case flow management set out in O 1 r 4A and r 4B of the Rules of the Supreme Court 1971 (WA) (RSC). Those rules have as their aim the elimination of delay between the commencement and final determination of an action, and management and supervision of actions in this court with the objects of promoting the just determination of litigation and efficient disposal of the business of the court.
Discovery is generally governed by O 26 RSC. 'Confidentiality' is not in itself a reason not to discover documents, where there is no claim to privilege. Order 26 r 1B expressly permits redaction of documents. The defendants point to (and therefore accept) the Areva NC (Australia) Pty Ltd v Summit Resources (Australia) Pty Ltd [No 3][27] and the statement of Martin CJ that 'while it is open to a party providing inspection of documents to mask a document provided, in the event of contention, that party will carry the onus of satisfying the court that masking the document was appropriate'.[28]
[27] Areva NC (Australia) Pty Ltd v Summit Resources (Australia) Pty Ltd [No 3][2009] WASC 67.
[28] Defendants' submissions [8], citing Areva NC (Australia) Pty Ltd v Summit Resources (Australia) Pty Ltd [No 3][2009] WASC 67 [38].
The decision of the Full Court in Alcoa of Australia Ltd v Apache[29] sets out propositions 'established by authority and uncontroversial' in terms of restricting access to discovered documents:
[29] Alcoa of Australia Ltd v Apache Energy Ltd [2014] WASCA 148 ('Apache').
1.a party to an action has a prima facie entitlement to inspect discovered documents, save in cases where the party giving discovery has a positive substantive right to withhold a document from production;
2.the prima facie entitlement to inspect extends to discovered documents containing confidential and/or commercially sensitive information;
3.inspection of discovered documents by or on behalf of a party gives rise to a substantive legal obligation to use the discovered documents solely for the purpose of the action in which they were discovered. The obligation extends to all persons who deal with the discovered documents with knowledge that they were obtained by way of discovery. A breach of this substantive obligation is a contempt of court;
4.ordinarily, the implied undertaking sufficiently protects the party giving discovery;
5.the court has a discretion under O 26 r 9(1) to make an order for production or inspection and a power to impose restrictions and/or conditions on inspection;
6.the court may exercise its power to impose limitations, restrictions or conditions for the purpose of protecting the efficacy of the implied undertaking;
7.the implied undertaking may be insufficient protection in a variety of circumstances, including but not limited to, cases where discovered documents are relevant to a trade rivalry between the parties to the action; and
8.the exercise of the discretion in O 26 r 9(1) will be informed by the nature and scope of the proposed limitations, restrictions or conditions on the inspection of discovered documents.[30]
[30] Alcoa of Australia Ltd v Apache Energy Ltd [2014] WASCA 148 ('Apache') [57] (McLure P).
Although the factual and litigation scenario in Apache was distinct from this matter, the principles are applicable to this application.
A party to whom documents are produced on discovery or pursuant to an order of the court is under an obligation not to use them or any information derived from them for a purpose unrelated to the conduct of proceedings: Hearne v Street[31] - the so-called Harman undertaking.
[31] Hearne v Street (2008) 235 CLR 125 at [107] - [108].
Findings
The issues are really these:
i.Is the information discoverable within the Discovery Orders?
ii.Is the information confidential?
iii.Should the plaintiffs' expert be ordered to destroy the Unredacted Documents he has?
Is the information discoverable within the Discovery Orders?
The defendants' counsel informed the court that the defendants reviewed 100,000 documents for discovery. 14,000 have been discovered. That shows either too broad a scope of original review, or admirable dedication to the task. Either way, only 14% of the reviewed documents were found to be discoverable. Of those 14,000, only 159 are said to be confidential or not within the scope of the discovery orders and therefore requiring redaction. It is by any measure a tiny proportion of the discovery consuming a disproportionate amount of the court's time and is difficult to reconcile with the principles of positive case flow management enunciated in O 1 r 4A and r 4B of the RSC.
I accept the plaintiffs' submission that the category 13 documents, relating to the value of the plaintiffs' plantations between 2018 and 2020 should not be limited solely to the plaintiffs' plantations, for the reasons that comparable data is required to make a meaningful assessment of loss, and that, given the defendants have put the issue of default in neighbouring plantations in issue, any difference in value between the plaintiffs' and neighbouring plantations may also be relevant to liability. To the extent that such information is irrelevant to either quantum or liability, it will not be relevant to the final determination of the issues between the parties at trial.
To the extent that data with respect to category 11 (TP6) cannot be effectively isolated - and it appears that it cannot - the defendants are not prejudiced or disadvantaged by providing that information to the plaintiffs by way of discovery as there are significant safeguards in place which protect the confidentiality of that information. Those safeguards are discussed below.
Is the information confidential?
The information with respect to valuation of other investors' plantations is confidential in a normal commercial sense and I do not understand the plaintiffs to have disputed that. The plaintiffs are bound by the implied Harman undertaking, which is a substantive obligation placed upon the plaintiffs, and also by the express and enforceable Confidentiality Undertakings provided by all three plaintiffs and their expert.
This is not a matter in which the defendants could have reasonable concerns with respect to enforceability of the Confidentiality Undertakings (the plaintiffs and their expert are all resident within this jurisdiction, which was not the case in Apache), and nor could there reasonably be concerns with respect to widespread dissemination within large organisations, which was also a matter for concern in Apache.[32] The plaintiffs in this case are an individual, two corporate trustees of family trusts and the expert is a single individual. Concerns as to widespread dissemination of confidential information outside the jurisdiction (or even within it) are adequately addressed by existing safeguards.
[32] Alcoa of Australia Ltd v Apache Energy Ltd [2014] WASCA 148 ('Apache') [66] (McLure P).
I find that the implied Harman undertaking and the express and enforceable Confidentiality Undertakings provide sufficient protection for information about other investors' plantations and that there is no basis to redact the documents simply to remove this information.
Defendants' confidential information
The next question to be addressed is whether defendants' confidential information should be redacted. The defendants' written submissions referred to 'valuation model' and 'inventory data' in this context. The Stevens Affidavit referred to 'inventory data' and 'a customised growth model', and during argument, defendants' counsel referred to 'growth model'. In these reasons 'confidential information' refers to all of these categories of confidential information.
There was no evidence put before the court as to the nature of the formulas for the growth model, or how or why (or by whom and when) those formulas were developed or tested and how they are different from, or superior to, any other growth models used by the defendants' competitors. There was no evidence as to how the information was protected within the organisation.
The assertion as to the nature of the material said to be confidential requiring redaction was made in broad terms by a person who spoke to what he understood to be the impact of its release, but not the nature of the material itself. This can be contrasted with Apache in which the trial judge (who imposed the confidentiality regime put in place on behalf of Apache) was provided with evidence that the information sought to be protected by a confidentiality regime related to critical infrastructure. The evidence in this application is not specific to either this level, or this degree of significance.
The next question to be considered with respect to protection of the growth methodology, is whether this is truly litigation between trade rivals. It clearly is not. It is litigation between three investors (an individual and two corporate trustees of family trusts) and a company. I accept the plaintiffs' submission in that regard.
The only evidence provided with respect to the relationship between the plaintiffs' expert and trade competitors was to the effect that the plaintiffs' expert has in the past consulted to those competitors. I do not consider that supportive of a conclusion that the plaintiffs' expert is a 'mouthpiece' of those competitors. No evidence was adduced showing that the plaintiffs' expert has, for example, previously given evidence on behalf of those competitors, or of any personal relationships which may lead to the conclusion that the expert is a 'mouthpiece' or of any publications or public utterances which may lead to that conclusion. The highest that evidence went was a statement on the expert's website that he had consulted to the competitor. The plaintiffs have not denied that.
Accordingly, I do not accept the submission that the plaintiffs' expert is the 'mouthpiece' for the defendants' main domestic competitors.
I note also, and accept, the plaintiffs' submission that concerns regarding the expert's identity were not raised until this application, which is inconsistent with the level of concern currently expressed.
I do not find that the confidential information attracts protection from disclosure to the plaintiffs' expert in the context of litigation, the existing and substantive Harman undertaking, and express and enforceable Confidentiality Undertakings.
Should the plaintiffs' expert be ordered to destroy the Unredacted Documents?
This question arises because the defendants did not comply with order 1 of the orders of 7 September 2021. The plaintiffs' solicitors, as they were entitled to do, released the Unredacted Documents to their clients and their expert. Should the expert now be required to destroy them because the defendants did not comply with the orders?
It is clear that Mr Louden and his team worked hard to comply with the timelines set in the orders.
It will be recalled that Mr Louden completed the redaction of the Unredacted Documents and emailed them to the defendants' Sydney solicitors at 7:15 am (WST) (9:15 am EST) on 10 September 2021, which was a Friday. This was early the day after the defendants were required to serve the documents in redacted form. The defendants were one day late. The plaintiffs' solicitors received the documents in redacted form on 13 September 2021.
No explanation was provided at the time by the defendants to the plaintiffs' solicitors, or subsequently (other than defendants' counsel's suggestion that the 'weekend intervened')[33] as to why the Unredacted Documents in redacted form were not provided to the plaintiffs' solicitors on 10 September 2021. Assuming Mr Louden's email was successfully transmitted (and there is no evidence that it was not), the defendants' Sydney solicitors received the material during normal working hours on a business day, and were, or should have been, aware, that the matter was time sensitive and that their clients were in breach of orders.
[33] ts 270.
The defendants submit that there is only one person in their organisation - Mr Louden - capable of undertaking the redaction of the documents. This is significant litigation. The defendants have engaged experienced and reputable solicitors and counsel. It would be prudent for those persons to become familiar, early, with the issues involved and to be involved, and provide constructive assistance, with the discovery process. It places a heavy burden upon one person to say that he is the only one with sufficient understanding of the issues to undertake the redaction task.
Be that as it may, it is for the defendants to decide their litigation management. It is not a matter which should affect the efficient and expedient conduct of this action, a principle to which I have referred earlier. In this instance, it has. It has resulted in the defendants relying on two legally qualified staff members, and two non-legally qualified staff members to undertake a complex and time sensitive task, the performance of which had legal consequences. The Quintis office in Perth is small. The defendants knew that when the orders were made and did not communicate to the plaintiffs' solicitors either the difficulties they were experiencing, or that they expected to provide the Unredacted Documents in redacted form the day after they were due.
The defendants chose to conduct the litigation in this manner. The outcome is that the plaintiffs' expert has, properly, been provided with the Unredacted Documents. That has had the cascading effect that much of the material sought to be protected has already been provided to him.
There is no basis upon which the plaintiffs' expert should be ordered to destroy the Unredacted Documents.
Disposition
From the above it follows that the defendants' application dated 1 September 2021 is dismissed.
The defendants' application for the plaintiffs' expert to destroy the Unredacted Documents is also dismissed.
Costs
The plaintiffs submitted that this was an appropriate case for an order for indemnity costs because:
i.This was a clear example of a situation in which the court would not make the orders sought. The plaintiffs' counsel was not aware of any case where the court has prevented access to documents by an opposing party's counsel.
ii.The plaintiffs have expended significant sums with respect to their expert's engagement, including a site visit to the Northern Territory, only now to be informed that he should not be permitted to inspect the documents.
iii.There is no proper evidence of confidentiality.
ivThe way in which the defendants have conducted the proceedings has caused the plaintiffs to incur significant costs. To the extent that this refers to past defaults, I will not consider it in the context of this application.
v. All of the above, justifies an order for indemnity costs.
The defendants oppose an order for indemnity costs on the basis that past defaults are irrelevant and that an indemnity costs order should not be punitive.
I accept the defendants' submission that an indemnity costs order should not be punitive or look back to past defaults.
I do not consider that this was such a hopeless case that the application should not have been made [cf Fountain Selected Meats referred to in Swansdale v Whitcrest].[34]
[34] Swansdale v Whitcrest [2010] WASCA 129 [10] (Pullin JA and Kenneth Martin J), quoting Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Ltd (1988) 81 ALR 397, 400 (Woodward J).
The defendants have been wholly unsuccessful in these applications. In that case, the proper order is that the defendants should pay the plaintiffs' costs of both applications to be taxed if not agreed.
Annexure A: Discovery Orders
ANNEXURE A- Categories of documents for discovery by 26 March 2021
All documents relating to:
i.The first plaintiff's IMA, Lease, Novation Deed and Loan Agreement;
i.The second plaintiff's IMA, Lease, Novation Deed, and Loan Agreement; and
ii.The third plaintiff's IMA, Lease and Novation Deed.
All documents relating to:
i.Irrigation of the Trees at Taylor's Park or Taylor's Park Farm 6; or
ii.Survival of the Trees at Taylor's Park or Taylor's Park Farm 6.
All documents relating to:
i.Destruction of the VSD of the Taylor's Park Farm 6 Bore;
ii.Maintenance and repair of the Taylor's Park Farm 6 Bore; or
iii.Maintenance and repair of the other bores at Taylor's Park.
All documents received in response to a Subpoena to produce documents issued on 14 December 2020 to the Controller of Water, Department of Environment and Natural Resources, Northern Territory Government.
2.
ANNEXURE B.1 - Categories of documents for discovery by 28 May 2021
Rainfall data for:
i.the plaintiffs' Taylor's Park Farm 6 plantations;
ii.Taylor's Park Farm 2; and
iii.Taylor's Park Farm 5;
for the period 1 January 2018 to 17 July 2020.
Soil moisture data for:
i.the plaintiffs' Taylor's Park Farm 6 plantations;
ii.Taylor's Park Farm 2; and
iii.Taylor's Park Farm 5;
for the period 1 January 2018 to 17 July 2020.
Watering logs for:
i.the plaintiffs' Taylor's Park Farm 6 plantations;
ii.Taylor's Park Farm 2; and
iii.Taylor's Park Farm 5;
for the period 1 January 2018 to 17 July 2020.
Sap flow data for:
i.the plaintiffs' Taylor's Park Farm 6 plantations;
ii.Taylor's Park Farm 2; and
iii.Taylor's Park Farm 5;
for the period 1 January 2018 to 17 July 2020.
Any and all documents evidencing plantation performance, tree health and the results of any tree count (sandalwood and hosts) undertaken at the plaintiffs' Taylor's Park Farm 6 plantations, for the period of 1 January 2018 to 17 July 2020.
Any and all documents relating to the valuation of the plaintiffs' investments produced by the defendants and provided to the plaintiffs in or around June 2019.
3.
ANNEXURE B.2 - Categories of documents for discovery by 28 May 2021
All documents relevant to the Taylor's Park Farm 6 bore failing to start.
All documents relevant to the destroyed VSD, and specifically, ordering, replacing and installing the VSD.
All documents relevant to the audit undertaken by SAGE Automation Pty Ltd ('SAGE') of all electrical systems at Taylor's Park including the external peer review of SAGE's upgrade recommendations, by the electrical engineering company, Imperium Energy Pty Ltd and the upgrade works performed by SAGE at Taylor's Park for the period 14 December 2018 to 14 December 2019.
All documents relating to:
i.the design of the irrigation system of Taylor's Park Farm 2, Taylor's Park Farm 5 and Taylor's Park Farm 6, their corresponding bores and the ability to share water between plantations at these blocks in 2018 and 2019;
ii.the actual diversion of irrigated water from Taylor's Park Farm 2 and Taylor's Park Farm 5 to Taylor's Park Farm 6 following the irrigation system at Taylor's Park Farm 6 ceasing to function in 2018; and
iii.the quantity of water customarily drawn from the Taylor's Park Farm 2, Taylor's Park Farm 5 and Taylor's Park Farm 6 bores,
for the period 1 January 2018 to 31 December 2019.
All documents relevant to any and all plantation monitoring at Taylor's Park Farm 6, including but not limited to tree health.
All documents relevant to the defendants' "replacement tree" proposal.
All documents relating to:
i.the "insured value" of each of the plaintiffs' plantations in 2018, 2019 and 2020;
ii.the "harvest value" of each of the plaintiffs' plantations in 2018, 2019 and 2020; and
iii.any other valuation prepared by the defendants (or any of their employees, agents, representatives or other third party) which relate to the plaintiffs' plantations, including for audit, tax, internal or external reporting or any other purpose.
All documents forming or relating to the defendants' assessment on or about 27 May 2019 that the trees on Taylor's Park Farm 6 were suffering from transitional stress, consistent with expectations.
All documents forming or relating to the advice from the first defendants' forestry personnel that the trees on Taylor's Park Farm 6 were undergoing transitional stress.
4.
All documents forming or relating to the defendants' assessment that the trees on Taylor's Park Farm 6 were suffering from symptoms associated with sunburn.
All documents in the defendants' possession, custody or power forming or relevant to trees on other sites on Taylor's Park showing stress due to transition, with an uninterrupted water supply.
All documents in the defendants' possession, custody or power forming or relating to, and underpinning their assertions that an unusually hot and dry wet season, transitional stress, pests and diseases, poor soil, pathogens in the soil and/or a combination of these issues contributed to the high mortality rate on Taylor's Park Farm 6.
All documents relevant to the November 2020 'institutional investor' sale of trees at Taylor's Park; not only the transaction documents themselves, but any and all documents demonstrating the negotiations that led up to the transaction, sales and marketing material relating to the transaction, and valuation material relating to the transaction.
All documents relating to the decision to cease irrigating the unmanaged blocks as identified in pages 7 and 9 of the report titled 'TAYLOR'S PARK FARM 6 - Report to Tim Weir and Mirek Marzec' dated 27 September 2019.
All documents relating to an investor site visit in June 2019 where forestry staff working for the defendants purportedly demonstrated that there was moisture in the soil.
All monthly water meter readings from January 2017 to date for the bore(s) supplying water from the Oolloo Dolostone Aquifer to Taylor's Park Farm 2, Taylor's Park Farm 5 and Taylor's Park Farm 6.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
AW
Associate
24 SEPTEMBER 2021
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