Olijnyk v Olijnyk

[2011] SASC 166

SUPREME COURT OF SOUTH AUSTRALIA

(Civil)

OLIJNYK  v  OLIJNYK & ORS

[2011] SASC 166

Reasons of Judge Lunn a Master of the Supreme Court

4 October 2011

PROCEDURE

Disclosure of documents - application by defendants under 6R 137(3) that plaintiff verify his disclosure of documents on oath.

Held - power to order verification under 6R 137(3) to remedy failure to make disclosure limited to where an order could be obtained under 6R 145(1).

Held - no "reason to doubt", which necessary to invoke 6R 145(1), was established - application refused.

OLIJNYK  v  OLIJNYK & ORS
[2011] SASC 166

JUDGE LUNN:

Reasons on defendants’ application for verification of the plaintiff’s disclosure by affidavit

1. In this action the plaintiff claims a declaration about a constructive trust in his favour and an order for provision under the Inheritance (Family Provision) Act 1972.  On 22 September 2011 the defendants issued an application (FDN26) for an order that the plaintiff verify on oath all of his lists of documents.  This was opposed by the plaintiff.  The application was brought under 6R 137(3) which provides:  “(3)           The list of documents is to be verified on oath if the Court so directs”.

   History of verification of lists of documents

2. Prior to 1972, parties to actions in this Court were only required to make disclosure (then called discovery) of documents, if it was so ordered by the Court.  The practice of the Court was to direct that such discovery be given by filing an affidavit of documents in which the party swore that the list was correct.[1]  In 1972, O31 r11 of the Supreme Court Rules 1947 was amended to provide that parties were obliged to make discovery of documents by filing lists of them without any direction of the Court to that effect.  A new O31 r 11(6) provided that a party could give a notice to another party requiring that party to verify his or her discovery by filing an affidavit.  In effect, this gave any other party the right to require an opponent to verify his or her discovery on oath.  This requirement was carried forward into 87R 58.02 of the Supreme Court Rules 1987. However, as from 3 June 2000 a new 87R 58A.08 applied, which provided:  “A list of documents is only to be verified on oath where the Court in the interests of justice so directs”.  This deprived an opponent of the right to require verification of discovery on oath and gave the Court a general discretion to order it.  I am not aware of any authorities on the application of 87R 58A.08.  87R 50A.08 was superseded as from 4 September 2006 by 6R 137(3), which is quoted above.

   [1]    See generally Chitty’s Queen’s Bench Forms 18^th ed, Chapter 4.

   Operation of 6R 137(3)

3. There is no doubt this sub-rule confers a broad judicial discretion upon the Court.   It does not expressly require an allegation of actual or potential default by the other party in compliance with its disclosure obligations under the Rules or a direction of the Court before it can be utilised.

4. 6R 145 provides:

   145—Non-compliance with obligations of disclosure and production of documents

   (1)If there is reason to doubt whether a party has fully complied with the party's obligations to disclose and produce documents under this Part, the Court may make orders the Court considers appropriate to ensure that the obligations have been fully complied with and, if necessary, to enforce those obligations.

   (2)The Court may (for example)—

   (a)require the party, or another person who may be in a position to provide relevant information, to appear before the Court for examination; or

   (b)require the party to answer written questions relevant to ascertaining whether the party has made full disclosure.

5. Sub-r 145(1) deals with where a party has not fully complied with its disclosure obligations.  Its operation is conditional upon the applicant establishing that there is “reason to doubt” that the other party has fully complied with its disclosure obligations.[2]  Once the threshold of “reason to doubt” has been established, sub-r 145(1) gives the Court wide general powers to make such orders as it considers appropriate to ensure that the obligations are fully complied with and to enforce them.  One of the traditional ways of ensuring such compliance is to order the respondent party to verify its disclosure on oath.  There is some tension between sub-r 145(1) and 6R 137(3) where the order is being made by reason of alleged default of the respondent in compliance with its disclosure obligations.  On the one hand, a combination of the two rules could mean that R 137(3) can be used in aid of enforcement of disclosure obligations, even where no “reason to doubt” has been established, or it could mean that if sub-r 137(3) is invoked, its operation is limited by the condition in sub-r 145(1) that there be “reason to doubt”.  I favour the latter interpretation.  The broad wording of 6R 145 suggests that it is intended to cover the field of incomplete disclosure.  The conclusiveness of a list of documents[3] is not to be displaced lightly and this appears to be the rationale behind the condition of “reason to doubt” being placed in 6R 145.  If an order for verification can be obtained without establishing “reason to doubt”, the Court is likely to be plagued with interlocutory applications by parties who are not prepared to accept the conclusiveness of their opponent’s list of documents, but who cannot invoke 6R 145(1).

   [2]    Ceneavenue Pty Ltd & Ors  v Martin & Ors White J, 25 November 2008, [2008] SASC 332.

   [3]    Mulley v Manifold (1959) 103 CLR 341.

6. The defendants’ counsel cited a ruling of White J in De Poi & Ors v De Poi & Ors (No 2)[4] in support of his proposed use of 6R 137(3).  White J said:

   77Although I will dismiss the greater part of the plaintiffs’ application for further and better disclosure for discretionary reasons, I accept that the plaintiffs have established some grounds for doubting that at least, in some respects, the defendants have fully discharged their obligations with respect to disclosure.  One way to require the defendants to give further attention to the matter is require the lists to be verified by affidavit.  That should not be an onerous task given the detailed attention which the defendants have, or should have, given to disclosure to date.  Although the plaintiffs’ application is made very late, I think it unlikely that a requirement that the existing lists be verified by affidavit will dislocate the arrangements for the trial.  Accordingly I will make orders to that effect.

   [4] 1 December 2010, [2010] SASC 333.

7. White J was dealing with an application under 6R 145, which he dismissed on discretionary grounds because it was too late.  In respect of some, although not necessarily all of it, he held that sufficient “reason to doubt” had not been established.  However, the point was not taken before him as to whether power under sub-r 137(3) was confined by 6R 145.  I do not consider that this decision precludes me from holding that my power under 6R 137(3) is so limited.

8. Counsel for the defendants also relied upon the decision of Lander J in Prolift Equipment Pty Ltd v Pronto Software Pty Ltd[5] and upon English authorities under O24 R3(1) of the English Rules of the Supreme Court 1965, but they were not decided in the context of rules that included an equivalent of 6R 145. Therefore they are not of assistance.

   [5]    31 October 2002.

   The facts

9. The plaintiff filed his first List of Documents (FDN8) on 22 September 2010.  He filed a second list (FDN13) on 28 October 2010.[6]

   [6]    On that day he also filed an Amended Statement of Claim.  It is unclear if this supplementary list was wholly or in part made necessary by the amendment to the Statement of Claim.

10. At a directions hearing on 17 March 2011 another Master directed that the defendants forward to the plaintiff’s solicitors a letter of request for further disclosure within seven days.  On 2 May 2011 the defendants issued an application (FDN18) that “the plaintiff produce and make available for copying to the Defendants within 14 days the following documents pertaining to his financial circumstances …”.  The application was stated to be made pursuant to 6R 142, which relates to the production of documents for inspection and not to further disclosure.  However, the supporting affidavit of the defendants’ solicitor, and the terms of my fiat of 21 July 2011, suggest that the application was treated as one for further disclosure.  That fiat read:

    3.Plaintiff to file supplementary list disclosing documents contained in letter of 18.7.11 within 14 days.

    4.Defts still to consider whether documents disclosed in answer to FDN18 are sufficient.

    On 1 August 2011 the plaintiff filed a Supplementary List of Documents (FDN23).

11. On 5 September 2011, which was the day before the next directions hearing, the defendants’ solicitors sent a letter to the plaintiff’s solicitors alleging that the plaintiff had made incomplete disclosure of documents relating to his financial position.  At the directions hearing on 6 September the defendants’ counsel made an oral application that the plaintiff verify his disclosure on oath, but I declined to make it.  The defendants’ counsel relied upon the letter of 5 September, to which the plaintiff’s solicitor said she had not had an opportunity to respond.  I reminded the plaintiff’s solicitor of the seriousness of the  obligations of the plaintiff to make proper disclosure.  On 20 September 2011 the plaintiff filed his fourth List of Documents (FDN25).  Its service was accompanied by a letter from the plaintiff’s solicitors acknowledging that some of the documents were incomplete and stating that steps were being taken to obtain complete copies which would be disclosed when they were obtained.

    Whether order for verification should be made?

12. The defendants’ counsel pursued FDN20 on the basis that the order should be made under sub-r 137(3).  He did not refer to R 145.  I find that no sufficient “reason to doubt” for the operation of 6R 145 has been established on the evidence before me.[7] 

    [7]    The fact that the plaintiff was still seeking some further documents does not constitute sufficient “reason to doubt”.  He was apparently aware of his obligations and was endeavouring to obtain the necessary documents.  It was not shown that those documents were, as at the issuing of FDN26, in his possession so that he could make disclosure of them.

13. I do not consider that the mere fact that the plaintiff had made four attempts at making full disclosure in itself is a proper basis to order that his disclosure be verified on oath.  It is common in these types of actions for parties to file several lists of documents.  Sometimes it is because further documents will become directly relevant due to amendments to pleadings and sometimes because the documents were not in their possession when the earlier list was filed.  I do not intend to embark on the tedious task of attempting to dissect each of the lists of documents here to see whether that may be the case for each document.  In any event, it is doubtful if I have sufficient background information to be able to fully determine the point.

14. In the submissions on 6 September the defendants’ counsel submitted that he needed the list verified on oath so that if upon the cross-examination of the plaintiff at the trial it transpired that he had not made full disclosure, he could not escape responsibility for it by claiming he had given the necessary instructions for such disclosure to his solicitors, but they had not been carried out.[8]  It is an argument that every list of documents should be verified on oath, but the history of the relevant Rules shows that this is no longer the policy of the Court.  If “reason to doubt” whether the plaintiff had fully complied with his obligations was established, this may well be an argument to make that order under 6R 145, but I do not accept that it has sufficient weight to justify such an order outside of 6R 145.

    [8]    In my 17 years experience as a trial Judge, there were instances of where parties had sworn affidavits of disclosure which were incomplete, but that still did not stop them blaming their solicitors for the omissions.

15. I have today made the following orders:

    1Paragraph 2 of FDN26 is dismissed.

    2Costs of FDN26 to be paid by the defendants to the plaintiff.

    3Fit for counsel.

    4Liberty to the plaintiff to apply for any supplementary costs orders.

    5Adjourned to directions hearing on Thursday 13 October 2011 at 10.50 am.