Pinara Group Pty Ltd v Whiting - [2013] FCA 1378

FEDERAL COURT OF AUSTRALIA
Pinara Group Pty Ltd v Whiting [2013] FCA 1378

Citation: Pinara Group Pty Ltd v Whiting [2013] FCA 1378

Parties: PINARA GROUP PTY LTD (ACN 065 392 029) v JOHN JAMES WHITING, BRECK DONALD WATERMAN and MOORE STEPHENS ADELAIDE PTY LIMITED

File number: SAD 124 of 2012

Judge: BESANKO J

Date of judgment: 17 December 2013

Catchwords:
PRACTICE AND PROCEDURE – Production of documents – improper use – application by third respondent for production of documents pursuant to rr 1.32 and 20.35 of the Federal Court Rules 2011 (Cth) – whether there is an arguable case that the plaintiff breached its implied obligation not to use documents or material produced under compulsion for an improper purpose – whether plaintiff used documents to obtain an opinion on the potential liability of a non-party and the preparation of a statement of claim against a non-party.

Held: The application be dismissed.

Legislation: Australian Securities and Investments Commission Act 2001 (Cth) ss 12DA, 12GF
Corporations Act 2001 (Cth) ss 1041H, 1041I
Federal Court of Australia Act 1976 (Cth) s 22
Federal Court Rules 2011 (Cth) rr 1.32, 9.01, 9.05, 20.35
Trade Practices Act 1974 (Cth) s 52

Cases cited: Allstate Life Insurance Co and Others v Australian and New Zealand Banking Group Ltd and Others (1995) 57 FCR 360
Arnold Mann v Medical Defence Union Ltd [1997] FCA 45
Hearne v Street (2008) 235 CLR 125
Sybron Corporation v Barclays Bank Plc [1985] Ch 299
The Bell Group Limited (in liq) & Ors v Westpac Banking Corporation & Ors [2001] WASC 315
Wilden Pump & Engineering Company v Fusfeld [1985] FSR 581

Date of hearing: 15 October 2013

Place: Adelaide

Division: GENERAL DIVISION

Category: Catchwords

Number of paragraphs: 37

Counsel for the Applicant: Mr T Cox SC

Solicitor for the Applicant: Johnson Winter & Slattery

Counsel for the Third Respondent: Mr J White

Solicitor for the Third Respondent: Cosoff Cudmore Knox

IN THE FEDERAL COURT OF AUSTRALIA

SOUTH AUSTRALIA DISTRICT REGISTRY

GENERAL DIVISION

SAD 124 of 2012

BETWEEN:
PINARA GROUP PTY LTD (ACN 065 392 029)
Applicant

AND:
JOHN JAMES WHITING
First Respondent

BRECK DONALD WATERMAN
Second Respondent

MOORE STEPHENS ADELAIDE PTY LIMITED
Third Respondent

JUDGE:

BESANKO J

DATE OF ORDER:

16 DECEMBER 2013

WHERE MADE:

ADELAIDE

THE COURT ORDERS THAT:
1.The oral application for the orders sought in “JRH-6” to the affidavit of Joseph Robert Henderson sworn on 27 September 2013 be dismissed.

Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA

SOUTH AUSTRALIA DISTRICT REGISTRY

GENERAL DIVISION

SAD 124 of 2012

BETWEEN:
PINARA GROUP PTY LTD (ACN 065 392 029)
Applicant

AND:
JOHN JAMES WHITING
First Respondent

BRECK DONALD WATERMAN
Second Respondent

MOORE STEPHENS ADELAIDE PTY LIMITED
Third Respondent

JUDGE:

BESANKO J

DATE:

17 DECEMBER 2013

PLACE:

ADELAIDE

REASONS FOR JUDGMENT

The applicant in this proceeding is Pinara Group Pty Ltd (“Pinara”) and the respondents are Mr John James Whiting, Mr Breck Donald Waterman and…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2013] FCA 1378
Decision Date

CaseChat Overview and Summary

In the case of Pinara Group Pty Ltd v Whiting, the Federal Court of Australia dismissed an application by Horwath SA Pty Limited for the production of documents on the basis that there was no arguable case of a breach of the implied obligation not to use documents produced under compulsion for an improper purpose. The application was brought by Horwath, a company subsequently joined as a respondent, against Pinara Group Pty Ltd, the applicant, to produce documents for inspection by Horwath and its lawyers. The documents in question were related to communications between Pinara and Mr. Brian Morris of Edwards Marshall, Chartered Accountant, and an affidavit of Peter Colin Gregg sworn on 21 March 2013. Horwath alleged that Pinara had breached the implied obligation by using the documents to obtain an opinion on the potential liability of a non-party and the preparation of a statement of claim against a non-party.

The court considered the relevant legal principles, including the implied obligation not to use documents or material produced under compulsion for a collateral or alien purpose, as well as the authorities on the use of discovered material to add new causes of action or parties to the action in which the documents have been disclosed. The court held that the use of the documents or material in this case was not a breach of the implied obligation, as it was a use for the purpose of the legal proceedings and did not involve any contempt. The court also found that the use of the documents or material was in line with the principle of avoiding a multiplicity of proceedings and that there was a reasonable connection between the claims against Messrs. Whiting and Waterman, on the one hand, and Horwath on the other.

In conclusion, the court dismissed the application for the production of documents, finding that there was no arguable case of a breach of the implied obligation. The court emphasized that the use of the documents or material in this case was a use for the purpose of the legal proceedings and did not involve any contempt, and that the principle of avoiding a multiplicity of proceedings and the reasonable connection between the claims against the different parties supported the dismissal of the application.

Orders