Seven Network v Dowling

[2017] NSWSC 1803

Supreme Court

New South Wales

Medium Neutral Citation:	Seven Network v Dowling [2017] NSWSC 1803
Hearing dates:	18 July 2017
Date of orders:	18 July 2017
Decision date:	19 July 2017
Jurisdiction:	Common Law
Before:	McCallum J
Decision:	Computer produced to the court by NSW police to be returned to the defendant; order for general access to packets S5 and S6 vacated
Catchwords:	PRACTICE AND PROCEDURE - subpoena
Legislation Cited:	Uniform Civil Procedure Rules 2005 (NSW), pt 23
Cases Cited:	Commonwealth v John Fairfax & Sons Ltd (1980) 147 CLR 39; [1980] HCA 44
Category:	Procedural and other rulings
Parties:	Seven Network (Operations) Limited (1st plaintiff) Seven West Media Limited (2nd plaintiff) Shane Dowling (defendant)
Representation:	Counsel: K Smark SC No appearance for the defendant   Solicitors: Addisons (plaintiffs)
File Number(s):	2017/00116771
Publication restriction:	Non-publication orders have been made in these proceedings

Judgment (DELIVERED ORALLY – REVISED)

1. HER HONOUR: These are proceedings brought by Seven Network (Operations) Limited (“Seven”) to restrain the disclosure and use of allegedly confidential information. The proceedings are in the Equity Division of the Court. The circumstances of their coming before me (in the Common Law Division) will be explained shortly.

2. The current defendant to the proceedings is Mr Shane Dowling. Yesterday, Mr Dowling brought an application before me as duty judge in the Common Law Division seeking the return of a computer owned by him which had been seized by police during the execution of a search warrant and later produced by police to the Court in response to a subpoena issued in these proceedings at the request of Seven.

3. At the conclusion of argument yesterday, I directed that the computer be returned to Mr Dowling. That order was made towards the conclusion of the Court's ordinary sitting hours (after lengthy argument). Accordingly, it was necessary to reserve my reasons. These are my reasons for making that order.

4. The circumstances in which Mr Dowling’s application was brought may be summarised as follows. The proceedings concern information which came into the possession of a former employee of the plaintiff during the period of her employment. By these proceedings, Seven seeks to restrain the disclosure and use of that material in the hands of a party to whom it is apprehended the material was leaked by the employee. The proceedings were commenced ex parte by summons filed in Court on 19 April 2017. At that stage Mr Dowling was not named as the defendant. The defendant was identified only as "the publisher" of a named website (the website cannot be named; an order has been made prohibiting its publication so as to preserve the interest sought to be vindicated in the proceedings).

5. On 19 April 2017, Ward CJ in Eq made ex parte orders until further order restraining the defendant as then named from using or disclosing the alleged confidential information and requiring certain material to be removed from the website. Her Honour made a further order allowing service by email at the email address nominated on the website.

6. The proceedings came back before her Honour the following day, presumably after service of the summons and orders in the manner directed. There was no appearance for the defendant and the proceedings were adjourned. They were adjourned several times after that; on no occasion did any entity or person appear in response to the description of the defendant as framed in the original summons.

7. On 23 June 2017, the plaintiff filed in court an amended summons naming Mr Dowling as the only defendant. It is not clear on the information I have available to me when Mr Dowling was served with the amended summons or when he was informed as to when the matter was next in court. His first appearance in the proceedings appears to have been before the registrar yesterday at the return of the subpoena. Mr Dowling denies that he is the publisher of the website; the purpose of his appearance was to secure the return of his computer.

8. The subpoena was issued on 5 July 2017 at the request of the plaintiff and was made returnable on 13 July 2017 (according to its terms). The recipient was the Commissioner of the New South Wales Police Force. The documents sought were described in the schedule as follows:

Documents recording the results of any inspection or analysis of the computers, hard drives, electronic devices or storage devices obtained pursuant to a search warrant executed at [a nominated address];

Any computers, hard drives, electronic devices or storage devices obtained by NSW Police, or copies of any of the information found on same made by NSW Police, as a result of the search warrant executed [at the address nominated] on or around 21 June 2017.

9. Confusingly, although the return date on the face of the subpoena was 13 July 2017, the only entry in the Court’s records for that date is a note that the subpoena was returnable the following day, 14 July 2017. I understand Mr Dowling did not appear on either occasion.

10. For reasons that are not clear, the subpoena was stood over to 17 July 2017 before the Registrar. On that occasion, Mr Dowling appeared. Over Mr Dowling's objection, the Registrar made the following orders for access:

Access only to an approved copying firm, possibly Law in Order, for seven days. General access to the other parties thereafter. The Court further orders that the laptop computer produced to the Court in packet S6 is to be returned to Mr Dowling upon a copy of the hard drive being retained by the Court. That laptop is to be returned to Mr Dowling within seven days if the copy of the hard drive is provided.

11. Mr Dowling came directly from the Registrar's court to the court in which I was sitting as Duty Judge to seek a review of those access orders. He informed me that he had informed his opponents appearing for the plaintiff of his intention to do so and that was confirmed by the fact that in due course they attended the court in which I was sitting.

12. Upon being informed (in the absence of the court file) that the action was brought in the Equity Division, the first issue I raised was whether the proceedings should more appropriately be determined by the Duty Judge sitting in that division yesterday. Mr Dowling indicated his preference to have the issue determined by me owing to my familiarity with issues in other proceedings against him in the Common Law Division, which he contended would have some importance to the issues raised by his application. After conferring, for propriety, with the Duty Judge in Equity, it appeared based on our respective listings that there was greater hearing capacity for an urgent application in this list and that there was no objection to my hearing it. Accordingly, I proceeded to hear Mr Dowling’s application.

13. The application was treated in substance as an application for review of the Registrar's access orders. In particular, Mr Dowling, whose computer was seized by police on 21 June 2017, opposed the order allowing an approved copier to hold it for a further period of up to seven days. The urgency contended for by Mr Dowling was his need to have the computer returned to him for a number of purposes, including his urgent need to prepare submissions for sentencing proceedings in a contempt application against him which is listed for hearing before Harrison J on Friday. The plaintiff in those proceedings, or at least some entity associated with Seven, is the moving party on the contempt motion. Mr Dowling also faces separate contempt proceedings which, as I understand the position, are part-heard before Wilson J brought on the application of the Prothonotary arising out of remarks Mr Dowling made in Court about a Registrar of the Court.

14. It has also been foreshadowed in these proceedings that Seven will bring a contempt motion against Mr Dowling in respect of the continued publication of the material the subject of the restraining and take-down orders made by Ward CJ in Eq on 19 April 2017. I note that, at the time that order was made, Mr Dowling was not the named defendant to the proceedings. It has nonetheless been foreshadowed that a contempt motion will be brought against him as an individual for failure or refusal to remove the offending material and for its continued publication. The premise of that application, as I understand the position, would be that Mr Dowling is the same entity as the originally-named defendant to the summons, being "the publisher” of the un-nameable website.

15. I considered that the matters relied upon by Mr Dowling to establish an urgent need to have his computer, which is his own possession, returned to him were sufficiently important to warrant hearing the application on an urgent basis. In light of the urgency of the hearing, it proceeded in an unusual and at times haphazard manner. Neither party had come armed with any evidence, for understandable reasons. I was compelled in the circumstances to inform myself as best I was able by reference to material provided in documentary form and matters stated on each side from the bar table.

16. I should note that the urgency and lack of orderly preparation of the application was not due to any fault on the part of Mr Dowling. Mr Dowling, who represents himself in the defence of these proceedings, was not served with the subpoena until the afternoon of 11 July 2017, less than two days before its first return date according to its terms.

17. In the absence of pleadings (the proceedings having been commenced by summons), the cause of action relied upon by the plaintiff must be discerned from the affidavit evidence that has been read in support of the motions brought to date, being two affidavits of Mr Keegan sworn 19 April and 23 June 2017. The action appears to be based upon the proposition that the former employee of the plaintiff, who it is clear is contractually bound not to use or disclose the confidential information in question, must have disclosed that information to its publisher on the website in circumstances such as to give rise to an equitable obligation on the part of recipient not to use or disclose the information.

18. The existence of a proper cause of action on that premise (such as to found the relief granted ex parte in the Equity Division) appears to be recognised in the authority of the Commonwealth v John Fairfax & Sons Ltd (1980) 147 CLR 39; [1980] HCA 44 at page 50. Factually, the cause of action rests on an inference that Mr Dowling is the person who received the information and that he received it in circumstances of the kind contemplated in that authority. It is not appropriate or necessary to determine the strength of any of those contentions beyond being satisfied that there appears to be a proper cause of action in law and one which might reasonably be argued on the facts I was told will be provable at trial. Accordingly, I determined Mr Dowling’s application on the assumption that there is a cause of action underlying the orders that have been made to date and the relief sought.

19. The more difficult question was whether it was appropriate to allow another entity to uplift the computer on terms the effect of which was not only to deprive Mr Dowling of possession of his rightful property but to do so in circumstances where his need for access to that property was informed by the impending criminal proceedings against him in the contempt applications to which I have referred.

20. In determining the application, I had regard to the following aspects of the circumstances in which the subpoena came to be issued at Seven’s request.

21. First, whilst it may be accepted that Seven was obliged to frame the subpoena in terms which did not impose any obligation in the nature of discovery on the recipient of the subpoena, the Commissioner of Police, it is plain enough that Seven could not have issued a notice to produce or subpoena to Mr Dowling in the terms of the schedule set out above. It would have been necessary to articulate with greater precision the documents or records sought. The schedule to the subpoena to the police as framed is apt to capture a broader range of documents which in all likelihood will include documents that do not have any relevance to any issue in these proceedings.

22. Secondly, it is clear enough that the plaintiff would not otherwise be entitled to uplift and inspect the whole computer. An application for inspection might have been brought under pt 23.8 of the Uniform Civil Procedure Rules 2005 (NSW) but none has been brought forward to date. Any such application at this stage, after a contempt motion has been foreshadowed (as a result of which Mr Dowling, as an individual, faces the prospect of a custodial sentence) would require consideration of the question whether its effect was to compel Mr Dowling to incriminate himself. Where access to the computer is sought by the very party bringing the contempt motion, the court must be astute to adopt a procedure that is fair.

23. Finally, it is unlikely that the plaintiff could have framed the application as one for interim preservation of the computer under part 25.3 (since the proceedings do not concern the computer itself as property) but that, in substance, is the effect of the access orders made by the Registrar.

24. The production of the computer by police after they had seized it in execution of a search warrant was, in effect, pure serendipity for the plaintiff. It created a practical opportunity for them to obtain production of an item I think it would have been difficult for them to inspect in the ordinary course of the proceedings otherwise.

25. The plaintiff pointed to the importance to its case of preserving any information connecting Mr Dowling with the publication of the impugned website. It must be accepted, having regard to aspects of Mr Dowling's conduct, as recorded in other judgments of the court, that that is a live concern. Conversely, however, I was concerned about two matters. One is the fact that the computer was prima facie Mr Dowling's own property. The Court should not lightly interfere with a person's right to possession of their own property in ways which fall outside the ordinary interlocutory processes of the court.

26. Secondly, and more importantly, I was concerned as to the potential impact on Mr Dowling of being deprived of the computer during the important period of his preparation for the sentencing proceedings to be heard by Justice Harrison this Friday and more generally other criminal allegations faced by him. Mr Dowling submitted that he needs the computer for those purposes. The plaintiff complained that there was no identification by Mr Dowling of any particular category of document he needed for that purpose. In my view, the likely need for the computer is obvious and I did not see that it should fall to Mr Dowling to have to establish that matter on evidence; rather, the assumption should be that he is entitled to have possession of his own asset unless a compelling basis was established for depriving him of it.

27. For those reasons, I vacated the orders for general access made by the Registrar and made orders to facilitate the return of the computer to Mr Dowling late yesterday afternoon.

28. Two further aspects of the circumstances surrounding this application should be noted. The first is that when the proceedings were listed today for publication of my reserved reasons, Mr Smark SC, who did not appear yesterday, very properly drew my attention to a matter which was not clear from the information before the court yesterday, namely, that there were in fact produced to the court by police two packets of documents. Packet S5 contains electronic documents. Packet S6 was the computer, which has now been returned to Mr Dowling. Unbeknownst to the court and, I apprehend, Mr Dowling, packet S5 was the subject of a general access order made on 14 July 2017.

29. The plaintiff has made two copies of those documents, but has not inspected them. The plaintiff proposed, and I agree, that those documents should not be inspected by the plaintiff until some procedure has been put in place to enable Mr Dowling to argue what he appears to have intended to argue all along - namely, that the subpoena ought to have been set aside before documents were produced. To that end, I propose to direct the plaintiff to return both copies of S5 to be held by the Court separately from packet S5 itself. There will be no order granting access to the copies. They will be preserved by the Court in their current form.

30. The second matter is that it emerged towards the end of the hearing yesterday that, during the relatively lengthy period over which the matter was being argued during the day, the authorised copier had in fact already uplifted the computer and was in the process of copying it throughout the day while argument proceeded. While that did not contravene the orders made by the Registrar and was in fact in accordance with those orders, in my view that is a matter which ought to have been brought to the attention of the Court at an earlier point while argument proceeded.

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Decision last updated: 11 January 2018