Shams v Commonwealth of Australia - [2021] SADC 106

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil: Application)
SHAMS v COMMONWEALTH OF AUSTRALIA & ORS
[2021] SADC 106
Judgment of his Honour Judge Burnett
16 September 2021
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - DISCOVERY AND INTERROGATORIES - DISCOVERY AND INSPECTION OF DOCUMENTS - DISCOVERY OF DOCUMENTS - UNDERTAKINGS AND USE OF DOCUMENTS - RELEASE FROM IMPLIED UNDERTAKING
This is an application by Australasian Correctional Services Pty Ltd (ACS) and The GEO Group Australia Pty Ltd (GEO) for release from the implied undertaking to use in other proceedings certain specified documents that were disclosed to them in the course of these proceedings. The documents in question relate to the detention of the applicant at the Baxter, Curtin and Perth Immigration Detention Centres between 2000 and 2005.
In these proceedings, the applicant has brought claims against the Commonwealth of Australia (the Commonwealth), G4S Australia Pty Ltd (G4S) and ACS for physical and mental harm caused by his detention at the Baxter Detention Centre. The detention centre and the system of detention for refugees was established by the Commonwealth, but was operated by G4S and ACS pursuant to a contract with the Commonwealth.
Other detainees have brought similar claims. One of those claims is brought by a Mr Payam Saadat against the Commonwealth, in which ACS, G4S, GEO and G4S Regional Management (UK & I) Limited have been joined as third parties. The Saadat proceeding is currently being heard in the Supreme Court. To date, the proceedings have occupied about eight sitting weeks and are expected to continue for some further time.
In the Saadat proceedings, Mr Saadat has provided a list of witnesses that he intends to call. These witnesses include the applicant in these proceedings, Mr Shams. Mr Shams will give evidence about his detention at the Baxter, Curtin and Perth Immigration Detention Centres. ACS and GEO seek release from the implied undertaking to use the documents in their cross-examination of Mr Shams when he gives evidence.
Mr Shams does not oppose the making of an order releasing ACS and GEO from the implied undertaking. The Commonwealth opposes the orders, but G4S does not.
Held:
1. ACS and GEO are to be released from the implied undertaking to use the specified documents in the Saadat proceedings.
2.The use of the documents obtained as a result of an order for discovery in these proceedings for the purpose of the cross-examination of Mr Shams in the Saadat proceedings is a use that is for a collateral or ulterior purpose and is prohibited unless ACS and GEO establish special circumstances: Mann v Medical Defence Union Ltd [1997] FCA 45 applied.
3. Special circumstances exist to permit ACS and GEO to be released from the implied undertaking and to use the documents in the Saadat proceedings: Australian Securities and Investments Commission v Marshall Bell Hawkins Limited [2003] FCA 833 and Springfield Nominees Pty Ltd v Bridgeland Securities Ltd (1992) 38 FCR 217 applied. Special circumstances do not require extraordinary factors to exist before the discretion is exercised. It is sufficient if good reason is shown for the use of the documents, contrary to the usual position that documents or information in one set of proceedings should not be used in another set of proceedings: Liberty Funding Pty Ltd v Phoenix Capital Ltd (2005) 218 ALR 283 applied.
4. Use of the documents are reasonably required for the purpose of achieving justice in the Saadat proceedings and will enable Mr Shams’ evidence in the Saadat proceedings to be properly tested. The Court in the Saadat proceedings will make findings as to the conditions of detention at Baxter and Curtin and in doing so may be informed by the evidence of Mr Shams. Most of the documents were authored by Australasian Correctional Management Pty Ltd (ACM) or form part of its business records. No prejudice is occasioned to any party by the release.
5. The implied undertaking extends beyond the parties and includes anyone who receives the documents with the knowledge that they are subject to the undertaking: Hammersley Iron Pty Ltd v Lovell (1998) 19 WAR 316 applied.
Mann v Medical Defence Union Ltd [1997] FCA 45; Australian Securities and Investments Commission v Marshall Bell Hawkins Limited [2003] FCA 833; Springfield Nominees Pty Ltd & Ors v Bridgelands Securities Ltd & Ors (1992) 38 FCR 217; Liberty Funding Pty Ltd v Phoenix Capital Ltd (2005) 218 ALR 283; Hammersley Iron Pty Ltd v Lovell (1998) 19 WAR 316, applied.
Hearne v Street [2008] HCA 36; (2008) 235 CLR 125 ; Riddick v Thames Board Mills Ltd [1977] QB 881; British American Tobacco Australia Services Ltd v Cowell [2003] VSCA 43; Esso Australia Resources Ltd v Plowman (1995) 183 CLR 10; Alterskye v Scott [1948] 1 All ER 469; Polyaire Pty Ltd v K-Aire Pty Ltd [2011] SASC 176 [2011] SASC 176; Deputy Commission of Taxation v Karas [2012] VSC 143; Northbuild Construction Pty Ltd v Discovery Beach Project Pty Ltd (No 4) [2011] 1 Qd R 145; Allstate Life Insurance Co v Australia and New Zealand Banking Group Ltd (1995) 57 FCR 360; Crest Homes PLC v Marks [1987] AC 829; Clone Pty Ltd v Players Pty Ltd (in liq) (receivers appointed) [2012] SASC 12; Lyons v Legalese Pty Ltd & Ors [2016] SASC 160; Ah Choo Teo v Pacific Media Group [2016] VSC 626; Australian Competition and Consumer Commission v Info4pc.com. Pty Ltd [2001] FCA 258; Holpitt Pty Ltd v Varimu [1991] FCA 69; (1991) 29 FCR 576; Australian Trade Commission v McMahon (1997) 73 FCR 211; Prudential Assurance Co Ltd v Fountain Page Ltd [1991] 1 WLR 756; Watkins v AJ Wright (Electrical) Ltd (1996) 3 All ER 31, considered.

SHAMS v COMMONWEALTH OF AUSTRALIA & ORS
[2021] SADC 106

Introduction

By an amended interlocutory application filed on 28 May 2021, Australasian Correctional Services Pty Limited (ACN 050 054 389) (ACS) and The GEO Group Australia Pty Ltd (ACN 051 130 600)(GEO) seek to be released from the implied undertaking to use in other proceedings certain specified documents that were disclosed to them in the course of these proceedings relating to the detention of the applicant at the Baxter, Curtin and Perth Immigration Detention centres.
The documents are sought for use in proceedings brought by Mr Payam Saadat against the Commonwealth of Australia (the Commonwealth), being proceedings No SCCIV 470 of 2018 in the Supreme Court of South Australia, in which ACS, G4S Australia Pty Ltd, GEO and G4S Regional Management (UK & I) Limited have been joined as third parties (the Saadat proceedings).
Background
There has been some confusion in the course of the application as to the identity of the third respondent to the action. The applicant initially brought proceedings against the Commonwealth as the first respondent, G4S Australia Pty Ltd (G4S) (which was then known as GSL (Australia) Pty Ltd) as the second respondent and ACM Correctional Management Pty Ltd as the third respondent in relation to the detention of the applicant in the immigration detention facility at the Baxter Detention Centre. The detention facilities and the system of detention for refugees were established by the Commonwealth, but were operated by G4S and ACS pursuant to a contract with the Commonwealth.
Australian Correctional Management Pty Ltd or ACM Correctional Management Pty Ltd did not exist as entities. Australasian Correctional Management Pty Ltd (ACM) did exist, but in 2004 changed its name to The GEO Group Australia Pty Ltd. In 2012, the applicant amended its summons and statement of claim to substitute ACS as the third respondent. In due course, ACS filed a notice of address for service.
The claims made by the applicant in these proceedings relate to what he alleges were systemic failures in the provision of health care services whilst he was detained at the Baxter Detention Centre and in particular in relation to the provision of psychiatric and psychological services. The applicant alleges that the respondents failed to provide adequate services and treatment to those detainees they knew or ought to have known were suffering from mental illness and failed to give proper consideration to medical opinion and recommendations. The applicant seeks damages for that failure, including for loss of income, pain and suffering, along with damages for future medical treatment.
There are similar claims made by other detainees against the Commonwealth and the operators of the immigration detention facilities. In total, there are about 70 claims in this Court brought by detainees raising similar, although not identical, issues to those raised in these proceedings. None of the cases in this Court have gone to trial.
The first case to go to trial is the Saadat proceeding which is currently being heard in the Supreme Court by Stanley J. Mr Saadat’s claim is based on his detention at the Curtin and Baxter Detention Centres. The hearing of the Saadat proceedings has already occupied about eight weeks of court hearing time. As at 22 June 2021, only Mr Saadat had completed his evidence and the evidence of the next witness was being heard. The Saadat proceedings adjourned at the end of June 2021 and are due to recommence in late October 2021.
In January 2021, the applicant in the Saadat proceedings, Mr Saadat, gave notice of witnesses that he proposes to call. One of those witnesses was the applicant in these proceedings, Mr Shams. Mr Shams was detained at both the Curtin and Baxter Detention Centres and also at the Perth Detention Centre. It is anticipated that he will give evidence about his experiences at Baxter and Curtin and subject to objection, his experiences at the Perth Detention Centre. Mr Shams has provided an affidavit in the Saadat proceedings in which he outlines the evidence that he will give in those proceedings. He is not to be confined to that evidence and will give his evidence viva voce in those proceedings. I accept the submission of ACS and GEO that the evidence sought to be adduced from Mr Shams will not be confined to evidence of his own experiences at the Curtin, Baxter and Perth Detention Centres, but will extend to the operations and conditions generally at those detention centres. The precise topics upon which Mr Shams will give evidence in the Saadat proceedings will be subject to argument in those proceedings.
ACS and GEO made their initial application for release from the implied undertaking on 20 May 2021 in which they sought all documents discovered in the action, but also including pleadings, expert reports and discovery lists and 10 categories of documents relating to the detention of the applicant at the Baxter Detention Centre. The amended application filed on 28 May 2021 deleted reference to the seeking the release from the implied undertaking in relation to all discovered documents and to the pleadings and discovery lists and expert reports. The application also narrowed the remaining categories of documents that were being sought to select categories of documents prepared by ACM.
At the time that these applications were being made and at the hearing of the application on 4 June 2021, the applicant had not in fact made discovery and GEO and ACS did not have possession of the documents. This was one of the grounds upon which the Commonwealth opposed the release of ACS and GEO from the implied undertaking. This argument was rendered otiose by this Court ordering that the applicant make discovery on 4 June 2021 and the applicant making discovery and providing copies of the discovered documents on 10 June 2021. The documents that are now sought were produced by the applicant in these proceedings and are set out as exhibits 1 and 2 to the affidavit of Philip Henry Chesterton Wines Cowdery sworn 22 June 2021. Exhibit 1 comprises files of the Department of Immigration and Multicultural Affairs between 2001 and 2004 and exhibit 2 comprises documents, primarily of ACM. It is in respect of the specified documents in exhibits 1 and 2 that ACS and GEO now seek to be released from the implied undertaking.
ACS and GEO have given notice to the other parties to the proceedings that they seek to be released from the implied undertaking so that they would be able to cross-examine Mr Shams in the Saadat proceedings. Mr Shams has advised that he has no objection to ACS and GEO being released from the implied undertaking. Except for the Commonwealth, none of the other parties have objected to the release.
Implied undertaking
Any documents that were produced pursuant to the order for discovery are subject to the implied undertaking, commonly referred to as the Harman undertaking or more recently, the rule of preclusion. That rule or undertaking has been recognised by the High Court in Hearne v Street.[1] In Hearne v Street, the High Court expressed the implied undertaking as applying to all cases:
Where one party to litigation is compelled, either by reason of a rule of court, or by reason of a specific order of the court, or otherwise, to disclose documents or information, the party obtaining the disclosure cannot, without the leave of the court, use it for any purpose other than that for which it was given unless it is received into evidence.
[1] [2008] HCA 36; (2008) 235 CLR 125 at [96].
The implied undertaking is a substantial legal obligation[2] and applies not only to documents produced on discovery, but wherever one party to litigation is compelled, by rules of court or by specific order of the court or otherwise, to disclose documents or information.[3]
[2] Hearne v Street [2008] HCA 36; (2008) 235 CLR 125 at [104].
[3] Ibid at [106].
The rationale for the obligation, as held in Hearne v Street,[4] is that the undertaking provides a limited right of privacy. The compulsion to disclose documents or information during the court process is an invasion of the party’s right to keep documents or information private. The public interest and privacy demands that this intrusion should not be pressed any further than justice requires. The implied undertaking is also said to encourage full and frank disclosure in legal proceedings, because it restricts the use of material disclosed during legal proceedings.[5]
Collateral and Ulterior Purpose
[4] Ibid at [107]; Riddick v Thames Board Mills Ltd [1977] QB 881 at 896.
[5] British American Tobacco Australia Services Ltd v Cowell [2003] VSCA 43 at [20].
The implied undertaking, if applicable, prohibits the use of documents or information that have been produced under compulsion from being used for collateral or ulterior purposes.[6] The focus is on the purpose for which the documents and information are to be used.
[6] Esso Australia Resources Ltd v Plowman (1995) 183 CLR 10 at [32] citing Alterskye v Scott [1948] 1 All ER 469 at 470.
I am satisfied that the documents that form the subject of this application, being the documents annexed to the affidavit of Mr Cowdery (the Documents) were produced under compulsion by Mr Shams and are therefore prima facie subject to the implied undertaking. The party obtaining the documents or information, in this case ACS, cannot, without leave of the court, use the document for any other purpose, other than the purpose for which they were given, unless the documents are received into evidence. The Documents cannot therefore be used in a way that it is not reasonably necessary for the conduct of these proceedings and cannot be used in other proceedings, such as the Saadat proceedings, unless special circumstances are shown to exist.[7]
[7] Polyaire Pty Ltd v K-Aire Pty Ltd [2011] SASC 176 at [37].
It is sometimes said that the implied undertaking prohibits the use of documents in another proceeding, but that formulation of the undertaking is not accurate and ignores that the underlying focus of the undertaking is on the purpose for which the documents and information are to be used.[8] In Mann v Medical Defence Union Ltd,[9] Ryan J held:
Usually, if not invariably, the use of documents disclosed in one action for the purposes of another action will be a collateral or ulterior purpose, even where the parties to both actions are identical, and where the causes of action are identical.
[8] Ibid; Deputy Commission of Taxation v Karas [2012] VSC 143 at [42]-[44]; Northbuild Construction Pty Ltd v Discovery Beach Project Pty Ltd(No 4) [2011] 1 Qd R 145 at [26].
[9] [1997] FCA 45.
There are two instances where the use of the documents for the purposes of another claim might not constitute a collateral or ulterior purpose.[10] Neither exception is relevant to the present application. First, documents could be used in a separate claim within the same proceeding, for example in a cross claim. Hill J in Allstate Life Insurance Co v Australia and New Zealand Banking Group Ltd[11] held that the use of documents to commence a cross claim against either an existing party or a new party was not an ulterior or collateral purpose. Ryan J in Mann v Medical Defence Union Ltd[12] was a little more qualified and held that there was no absolute rule that the use of documents in a cross claim could never constitute a collateral or ulterior purpose. Although the use of documents to commence a cross claim would not normally infringe the undertaking, Ryan J held that the proposed use of the material must bear a reasonable relation to the primary claim. The second exception is that documents or information may be used for contempt proceedings.[13]
[10] M. Groves, “The Implied Undertaking: restricting the use of material obtained during legal proceedings” (2003) 23 Australian Bar Review 314 at 325-326.
[11] (1995) 57 FCR 360 at 378-380.
[12] [1997] FCA 45.
[13] Crest Homes PLC v Marks [1987] AC 829.
The relevant test as to whether documents are being used for a collateral or ulterior purpose is whether the documents or information that have been produced are being used for a purpose unrelated to or unconnected with the proceeding or litigation in question or not for a purpose reasonably necessary for the conduct of the litigation.[14] I consider that this approach conforms with the nature of the implied undertaking, as expressed in Hearne v Street, which focuses on the purpose for which the documents were obtained and the purpose for which they are now sought to be used.
[14] Id at [44]-[47]. Approved in Deputy Commissioner of Taxation v Karas [2012] VSC 143 [42]-[43].
I am satisfied therefore that use of the Documents in the Saadat proceedings is a use for a collateral or ulterior purpose to the purpose to which the Documents were produced in these proceedings. The proceedings are separate proceedings, involving different parties.
Special Circumstances
In these circumstances, ACS and GEO are prohibited from using the Documents in the Saadat proceedings unless they can establish special circumstances which entitle them to be released from the implied undertaking. In Hearne v Street, the Court held that there was a discretion to release a party from the implied undertaking if special circumstances are shown to exist. The onus of persuading a Court to exempt a party from the implied undertaking (or rule of preclusion) rests on the party seeking the exemption.[15]
[15] Clone Pty Ltd v Players Pty Ltd (in liq) (receivers appointed) [2012] SASC 12 at [186]. Applied in Lyons v Legalese Pty Ltd & Ors [2016] SASC 160 at [72].
In Crest Homes PLC v Marks,[16] the House of Lords held that a party seeking release from an implied undertaking must satisfy the court there are special circumstances to support an order for release. The party seeking release from an implied undertaking must prove that the release would not occasion injustice or prejudice to the party who provided the material.
[16] [1987] AC 829.

In Australian Securities and Investments Commission v Marshall Bell Hawkins Limited,[17] Merkel J set out the procedure that should be adopted by a party seeking release from the undertaking based on the existence of special circumstances:
[12] Generally, a party applying for the modification or release of the undertaking should:
·specify the documents in respect of which the modification or release is sought;
·specify the purpose for which the modification or release is sought; and
·satisfy the Court that the special circumstances relied upon by the party warrant or justify the modification or release sought.
[13] The requirements of specificity in respect of the documents to be used and the purpose for which they are to be used is appropriate because the implied undertaking should only be modified or released to the extent that it is in the interests of the administration of justice or in the public interest to do so: see Springfield Nominees at 225 and Moage Limited (in liq) v Jagelman [2002] NSWSC 953; (2002) 43 ACSR 173 ("Moage") at 176. Thus, the modification or release should be no greater than is necessary or appropriate to meet the interests of the administration of justice or the public interest. Further, in determining whether to exercise its discretion to grant the modification or release sought, it will usually be necessary for the Court to identify with precision the documents to be released and the purpose of that release.
[17] [2003] FCA 833 at [12]-[13]; applied in Ah Choo Teo v Pacific Media Group [2016] VSC 626 at [25].
The decision of Wilcox J in Springfield Nominees Pty Ltd & Ors v Bridgelands Securities Ltd & Ors[18] also addressed what constitutes special circumstances. That decision has been widely accepted.[19] In Springfield Nominees, Wilcox J held:
For special circumstances to exist, it is enough that there is a special feature of the case which affords a reason for modifying or releasing the undertaking, and is not usually present. The matter then becomes one of the proper exercise of the court's discretion, many factors being relevant. It is neither possible nor desirable to propound an exhaustive list of those factors. But plainly, they include the nature of the document, the circumstances under which it came into existence, the attitude of the author of the document, and any prejudice the author may sustain, whether the document pre-existed litigation or was created for that purpose, and therefore expected to enter the public domain, the nature of the information in the document (in particular whether it contains personal data, or commercial sensitive information), the circumstances in which the documents came into the hands of the applicant for leave and, perhaps most important of all, the likely contribution of the document to achieving justice in the second proceeding.
[18] (1992) 38 FCR 217 at 225.
[19] Australian Securities and Investments Commission v Marshall Bell Hawkins Ltd [2003] FCA 833 at [11]; Australian Competition and Consumer Commission v Info4pc.com. Pty Ltd [2001] FCA 258 at [6]-[7]; Clone Pty Ltd v Players Pty Ltd (in liq )(receivers appointed) [2012] SASC 12 at [187].
In reaching this determination, Wilcox J referred to the decision of Burchett J in Holpitt Pty Ltd v Varimu,[20] where the Court adopted an approach that considered special circumstances in the context of all the cases in the court and not in the context of the very small number of cases in which a reason appears why the undertaking may be relaxed.[21]
[20] [1991] FCA 69; (1991) 29 FCR 576 at 578-579.
[21] (1992) 38 FCR 217 at [22].
Lehane J followed this approach in Australian Trade Commission v McMahon[22] and held that where an application for release is decided in contested proceedings, it seems that special circumstances will fairly readily be found where it established that the use of the documents discovered in a proceeding is reasonably required for the purpose of doing justice between the parties in the other proceedings. As held by the Full Court of the Federal Court in Liberty Funding Pty Ltd v Phoenix Capital Ltd,[23] the notion of special circumstances does not require that some extraordinary factors must exist before the discretion is exercised. Rather, it is sufficient that good reason is shown for the use of the documents, contrary to the usual position that documents or information obtained in one set of proceedings should not be used in another set of proceedings.
[22] (1997) 73 FCR 211 at 217.
[23] (2005) 218 ALR 283 at [31].
Determination
I consider that the Documents are reasonably required for the purpose of achieving of justice in the Saadat proceedings. In my opinion, the Documents will allow Mr Shams’ evidence in the Saadat proceedings to be evaluated by reference to contemporaneous records. Mr Shams proposes to give evidence as to various incidents that he was involved in at detention centres. The Documents include incident reports, incident follow up reports and disturbance reports. These reports provide contemporaneous records of these incidents and allow ACS and GEO to cross-examine Mr Shams by reference to such reports. Mr Shams further proposes to give evidence about his treatment at the three detention centres and in particular his alleged mistreatment. The Documents include complaints made by or on behalf of Mr Shams. They are directly relevant to the evidence that he proposes to give. Thirdly, Mr Shams will give evidence about the respondents’ knowledge of his physical and mental health and how they have responded to that action. The Documents include many documents which provide evidence on this topic and which ACS and GEO may wish to put to Mr Shams in cross-examination. The Documents include an initial placement assessment, watch log, daily reports, suicide watch, interim risk plan, case management review meetings and risk treatment plan. Fourthly, Mr Shams proposes to give evidence about his medical condition and treatment. The Documents include a referral to a psychiatrist, nurse consult records and a fitness to travel certificate. All of these documents are directly relevant to the issue of Mr Shams’ medical condition and are likely to form part of the cross-examination of Mr Shams by ACS and GEO.
I also take into account that although the Documents are described as being part of the files of the Department of Immigration and Multicultural Affairs, in fact most of the documents were either authored by ACM or are part of the business records that were kept by that organisation. Clearly, the author of the Documents, ACM, does not oppose the release from the Undertaking.
I note that Documents were in existence prior to this litigation and were not prepared for the purpose of this litigation. I place little weight on this circumstance, given the attitude of the author of the Documents and of Mr Shams. I also take into account that the Documents are largely historical in nature.
I do not consider that any party will suffer prejudice if ACS and GEO are released from the implied undertaking in respect of the Documents. No party has identified in particular prejudice that will ensue if ACS and GEO are released from the implied undertaking in respect of the Documents. I note that there is some private information contained about Mr Shams and other detainees. Such information, as it relates to other detainees, is of a private and confidential nature, but I would expect that orders could be made in the Saadat proceedings that it not be published. Given the consent of Mr Shams to the application, there is no relevant prejudice that he will suffer.
Taking into account all of the above matters, I am of the opinion that ACS and GEO should be released from the implied undertaking in respect of the Documents. I consider that ACS and GEO have established special circumstances for the release from the implied undertaking. The use of the Documents which were discovered in these proceedings is reasonably required for the purpose of doing justice between the parties in the Saadat proceedings. As the applicant has submitted, Saadat is the lead case and although its judgment will not bind the parties in other proceedings, it will be given considerable weight on a number of issues that will be common to both sets of proceedings. I note that the Commonwealth objected to the description of Saadat as the lead case, but in the sense that it is first of the detainee cases to go to trial, it is held in a superior court, and many of its findings, if not strictly binding, will be highly persuasive, I do not consider that label inappropriate.
In the conduct of their defence in the Saadat proceedings, ACS and GEO are entitled to deploy the Documents so as to challenge Mr Shams’ evidence. As ACS and GEO submitted, it is likely that the Court in Saadat will make findings as to the conditions of detention at Baxter and Curtin. In doing so, the Court may be informed in part by the evidence of Mr Shams. In these circumstances, ACS and GEO are entitled to use the Documents as they see fit in the Saadat proceedings. I do not accept the submission of the Commonwealth that the application of ACS and GEO is based on the premise of conducting a cross-examination on an alternative position of admissibility and relevance. I also reject any contention that because the primary use of the documents by ACS and GEO may be in the cross-examination of Mr Shams in the Saadat proceedings and therefore goes to issues of credit, there is not a legitimate basis for the release from the implied undertaking.
Some of the Documents may, depending on what rulings are made in the Saadat proceedings, not be relevant or admissible in those proceedings. Others of the Documents will remain relevant and admissible. It is not for this Court to specify what purposes the Documents might be used in the Supreme Court. As White J held in Polyaire Pty Ltd v K-Aire Pty Ltd:[24]
In my opinion, this Court should respect the authority of the Federal Court to determine for itself the evidence which may properly be placed before it in proceedings. Generally speaking, it would not be appropriate for this Court to attempt to bind the Federal Court by stipulating that some proposed uses in the Federal Court are permissible, and some not. If it is otherwise appropriate for Polyaire to be given a release from the implied undertaking so as to permit it to make use of documents in relation to the Federal Court proceedings, the particular forensic use in those proceedings to which Polyaire may put the documents should be controlled by the Federal Court.
[24] [2011] SASC 176 at [64].
There can be no prejudice to any party if the Documents are not admissible in the Saadat proceedings. It would cause prejudice to ACS and GEO if they were not released from the undertaking at this time and in advance of Mr Shams giving evidence in the Saadat proceedings, so that they could be in a position to be able to properly prepare for that cross-examination.
The Commonwealth had opposed the application when it was first heard on the basis that at that time no order for discovery of the Documents had been made and therefore the Documents had not been produced under compulsion. Before the Documents were produced, it would also be difficult to identify the precise nature of the documents and the prejudice that a party or a third party might suffer as a result of the release from the implied undertaking. However, as an order from discovery was later made, it was not necessary to decide whether an order for release from the implied undertaking could be made in advance of a party receiving the documents that were sought to be used.
Similarly, an objection to the width of the documents has also fallen away. The Commonwealth initially raised an objection to the width of the categories of documents being sought to be released from the undertaking and whether it could be said that the release of all of these documents was necessary for use in the Saadat proceedings. The Commonwealth submitted that the minimum number of documents should be released from the undertaking. That submission accords with the statement of Merkel J in Australian Securities and Investments Commission v Marshall Bell Hawkins Ltd,[25] discussed above, that the release should be no greater than is necessary or appropriate to meet the interests of justice. The Documents sought to be released from the undertaking have been refined to those annexed to the affidavit of Mr Cowdery, so this objection no longer is relevant and the release is no wider than necessary.
[25] [2003] FCA 833 at [13].
The Commonwealth also submitted that there may be a possibility of inconsistent findings in these proceedings and the Saadat proceedings if Mr Shams gives evidence in the latter proceedings. In my opinion, that risk does not arise from the release from the implied undertaking, but from Mr Shams electing to give evidence in the Saadat proceedings. In any event, any findings made in the Saadat proceedings in relation to Mr Shams cannot bind the Court in these proceedings as they will relate to different issues.
A question arises as to whether it is necessary that an order be made in favour of GEO that it be released from the undertaking. GEO, of course, is not a party to these proceedings. The position of third parties was discussed in Herne v Street[26] where the plurality held that the primary person bound by the undertaking is the person who receives the documents or information from the other side, but the obligation extends to others to whom the documents are given such as experts and other agents. However, the undertaking goes beyond those persons to any person who receives the documents with the knowledge that they are subject to the undertaking. In Hearne v Street,[27] the plurality referred to the remarks of Hobhouse J in Prudential Assurance Co Ltd v Fountain Page Ltd[28] where he held:
Any person who knowingly … does acts which are inconsistent with the undertaking is himself in contempt and liable to sanctions:
Similarly, in Watkins v AJ Wright (Electrical) Ltd,[29] Blackburne J held that third parties could be bound by the undertaking and found no reason to confine it to the parties and their solicitors. In Hammersley Iron Pty Ltd v Lovell,[30] Anderson J (Pidgeon and Ipp JJ concurring) held:
The implied undertaking is binding upon anyone into whose hands the discovered documents come, if he knows that they were obtained by way of discovery.
[26] [2008] HCA 36; (2008) 235 CLR 125 at [109].
[27] Ibid.
[28] [1991] 1 WLR 756 at 765.
[29] [1996] 3 ALL ER 31 at 41-43.
[30] (1998) 19 WAR 316 at 334-335.
Given that GEO is part of the same group of companies as ACS and that it a co-respondent with ACS in the Saadat proceedings, I consider that it might well be the case that GEO will come into possession of the documents, perhaps jointly with ACS, such that it is necessary for GEO to be released from the implied undertaking before it uses the Documents. For these reasons, I consider that it is appropriate that my order extend to GEO.
Conclusion
For the reasons that I have expressed, I order that ACS and GEO be released from the implied undertaking in relation to the Documents for the purpose of their use in the Saadat proceedings.