Moodie v Perna (Ruling No 1)

[2018] VSC 158

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

MAJOR TORTS LIST

S CI 2017 01417

DAVID JOHN MOODIE	Plaintiff
v
SAL PERNA	Defendant

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JUDGE:	QUIGLEY J
WHERE HELD:	Melbourne
DATE OF HEARING:	4 April 2018
DATE OF RULING:	4 April 2018 (ex tempore) (Revised 9 April 2018)
CASE MAY BE CITED AS:	Moodie v Perna (Ruling No 1)
MEDIUM NEUTRAL CITATION:	[2018] VSC 158

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PRACTICE AND PROCEDURE — Production and inspection — Subpoena — Related proceedings — Court of Appeal proceedings — Harman undertaking

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr S Wilson QC and Mr S Mukerjea	Findlay Arthur Phillips
For the Defendant	Mr J Bayly	Victorian Government Solicitor

HER HONOUR:

1. This application was brought by the plaintiff’s Summons dated 28 March 2018.

1. The plaintiff seeks to be permitted to produce and rely on copies of emails, which have been discovered in these proceedings (“the defamation proceedings”) in a separate judicial review proceeding now under appeal to the Court of Appeal in proceeding S APCI 2017 0134 (“the judicial review appeal”).  The emails were not evidence in the judicial review proceeding at first instance as they only came to light after discovery in the defamation proceeding, and the particular email contained in exhibit “MGW-11” to the affidavit of Michael Geoffrey Witt sworn on 27 March 2018 only came to the plaintiff’s attention after being produced on subpoena by a third party, Mr Beazley (“the defendant-Beazley email”).

1. Any reliance on the emails would be subject to the Court of Appeal granting leave to do so as they are new evidence not relied upon in the judicial review proceeding at first instance.  The Summons seeking leave to be relieved from the implied undertaking not to use documents produced pursuant the Court’s compulsory procedures in a proceeding for an ulterior or other purpose (otherwise referred to as the “Harman undertaking”[1]) is brought so that the Harman undertaking issue can be dealt with now and the parties, if the parties choose to do so, may seek to rely on those documents in the upcoming judicial review appeal.

   [1]See Harman v Secretary of State for the Home Department [1983] 1 AC 280 (“Harman”).

1. The defendant does not oppose the plaintiff’s application to be released from the Harman undertaking insofar as I find the Harman undertaking needs dispensation.  I note the plaintiff’s concession that if the undertaking is to be released in respect of the plaintiff, that it is also to be released in respect of the defendant.

1. The defendant contends that the preferable view is that the parties may use the documents produced in the defamation proceedings in the judicial review appeal without breaching their Harman undertakings, but that I should, following the approach adopted by J Forest J in Deputy Commissioner of Taxation v Karas[2] (“Karas”), make an order in an abundance of caution granting leave to the parties to use the nominated documents.

   [2][2012] VSC 143.

1. The defendant also contends that the Court should also order that the parties be released from their Harman undertaking with respect to further documents, those documents being exhibits “WFY-1” – “WFY-5” of the affidavit of William Francis Yates affirmed on 3 April 2018 (“the further documents”).

1. The defendant says that the further documents provide necessary context to the defendant-Beazley email in that they support the defendant's submission that the Racing Victoria Limited (“RVL”) media release misrepresented to the public the findings of a report issued to RVL by Mr Perna and thus called for a public correction.  If the parties’ Harman undertakings are only varied insofar as it is necessary to enable the plaintiff to seek to tender the defendant-Beazley email at the hearing of the judicial review appeal, there is real danger that the document may be received as fresh evidence in circumstances where other evidence necessary to contextualise its contents cannot, by reason of the parties’ ongoing Harman undertakings in this proceeding, be adduced.  This would not promote the achievement of justice in the defendant’s appeal, rather it would undermine it.

1. The Court ought not release or modify the Harman undertaking except in ‘special circumstances’.[3]  It is not a step to be taken lightly.  A party who is permitted to inspect a document produced under the compulsory process of the Court in relation to proceedings, including under subpoena, is subject to the obligation not to use the document or the information or knowledge acquired from the document otherwise for the purposes of the proceeding without the consent of the owner of the document or by leave of the Court.[4]  The obligation is a substantive one arising from the circumstances in which the document was generated and received.[5]

   [3]See Hearne v Street (2008) 235 CLR 125, 160 [107] (“Hearne”); See Barrow v McLernon [2012] VSC 134, [27] (“Barrow”).

   [4]Hearne, 154-5 [96].

   [5]Ibid 156-7 [102].

1. The factors which may assist in determining whether ‘special circumstances‘ exist have included:[6]

   [6]Barrow, [28]-[30].

a)   whether there is a special feature of the case which affords a reason for modifying or releasing the undertaking and is not usually present;

b)     the circumstances in which the document came into existence;

c)   the attitude of the document’s author, and any prejudice they may sustain;

d)     whether the document existed prior to the litigation, or came into existence for the purpose of the litigation in which case it might have been expected that it would enter the public domain;

e)   whether the document contains personal data or commercially sensitive information;

f)   the circumstances in which the document came into the hands of the applicant for leave; and

g)     the likely contribution of the document to achieving justice in the second proceeding.

1. The plaintiff’s application seeks only the removal of the Harman undertaking in respect of what is referred to as the defendant-Beazley email.  That email was the last in a chain of emails the balance of which had already been produced on discovery in this proceeding.  The last email in the chain was produced in respect of the subpoena that was served on Mr Beazley.

1. I understand that Mr Beazley did not intend to appear in the application and that he does not propose taking any part in this application, nor does he object to the order being made in the sense that he has not sought to oppose it.  He has not raised any issue or prejudice to himself.

1. I have considered the submission of both parties and the factors relevant to leave being granted in this application as set out above.  Both parties have indicated to the Court that the additional defendant-Beazley email is relevant to both the defamation and judicial proceedings.  I accept that, and I will make that order granting leave to the parties in respect of that document.  However, I do not see that the release of the Harman undertaking in respect of the defendant-Beazley email alone would be in the interests of justice.

1. As has been put to me by both parties, there is both legal issue overlap and factual overlap in the two proceedings.  The parties disputed the extent of that overlap, particularly the extent of legal issue overlap.

1. I find that there is certainly sufficient overlap in the circumstances which gives rise to the two proceedings.  The ‘Perna press release’ did not get produced in a vacuum and there are clearly matters which are relevant factually to both the defamation proceeding and the judicial review proceeding.  Insofar as there are legal issues, there would appear to be a number of matters raised which also overlap.

1. The question for me is whether or not I release the parties from the Harman undertaking not whether or not any of those documents are relevant or are indeed admissible in the judicial review appeal.  That is a matter entirely for the Court of Appeal.

1. The two proceedings here are not as identical to each other as those proceedings that were before J Forrest J in Karas.  In that matter, the related proceedings were part of a continuum arising from a tax payment obligation which led to a series of proceedings related to the tax obligation.  Not all of those proceedings involved exactly the same legal issue.  Their genesis was the same factual background, and in that sense, these proceedings also arise from the same factual background and there are a number of overlapping arguments and circumstances which are common to both.

1. I have formed the view that there is a requisite extent of overlap leading to the conclusion that one could form the view that the two proceedings are ‘intimately bound up’.[7]  But if I am wrong in that, having not fully reviewed all of the pleadings in detail in respect of both matters but having read Justice Bell's decision at first instance in the judicial review proceedings,[8] I think that for the avoidance of doubt, the Court should order that the parties be released from their Harman undertakings with respect to the defendant-Beazley email and in relation to the documents that form “WFY-1” to “WFY-5” of the affidavit of Mr Yates affirmed on 3 April 2018 (that is, the further documents).

   [7]See Karas, [43], [59(c)].

   [8]Moodie v Racing Integrity Commissioner [2017] VSC 693.

1. The written submissions of the parties, and those advanced orally today, generally proceed on the basis of the same understanding of the law.  It is really a matter of whether I am satisfied that the facts and circumstances are such that there is sufficient overlap and that the use of the particular documents produced under compulsion in the defamation proceeding are not being used for “a collateral or ulterior purpose”[9] such that it would be a bar to their use in that second proceeding.  I am of the view that there is sufficient overlap, and that the other factors which are relevant to my consideration do not outweigh the making of the order.  As I have indicated, out of abundance of caution, I will make the order.

   [9]See Harman 302, 304 (per Lord Diplock) 313 (per Lord Scarman) 321-22,327 (per Lord Roskill).

1. There are a number of matters that are raised in particular in the written submissions which I have taken into account in determining whether there are special circumstances which would suggest that a particular course be followed.  In particular, there is no prejudice identified to the owner of the documents.  In my view, the interests of justice are better served by the limited relief from the Harman undertaking being granted in the manner that the defendant has put forward.

1. Ultimately, as I have indicated, the relevance or otherwise and their admissibility before the Court of Appeal will be entirely a matter for the Court of Appeal to determine, but in these circumstances in relation to the further documents, to shut out the defendant from attempting to make that argument as to their admissibility or otherwise, I am not convinced would be appropriate.

1. It is proper for a party to bring an application on Summons to be released from a Harman undertaking as it is not for the parties to decide for themselves whether they are to be released from the undertaking.  It is a matter for the Court’s supervision. Further, the appropriate order in these circumstances is costs in this proceeding.

THE COURT ORDERS THAT:

1. The documents to which this order applies are:

(a)   the document that forms exhibit “MGW-11” to the affidavit of Michael Geoffrey Witt sworn on 27 March 2018; and

(b)   the documents that form exhibits “WFY-1” to “WFY-5” to the affidavit of William Francis Yates affirmed on 3 April 2018.

1. The parties are released from their implied undertaking not to make collateral use of the material produced in this proceeding S CI 2017 01417 (and in the case of the plaintiff the express undertaking given to Mr Beazley by letter dated 21 March 2018) in Court of Appeal proceeding S APCI 2017 0134.

1. Any use of a document referred to in this order is subject to leave being granted by the Court of Appeal to rely on such document in proceeding S APCI 2017 0134.

1. The costs of today’s hearing are in this proceeding.