Smith v Trustees of the Christian Brothers
[2023] VSC 171
•5 April 2023
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
INSTITUTIONAL LIABILITY LIST
S ECI 2021 00868
| JAMES SMITH | Plaintiff |
| v | |
| TRUSTEES OF THE CHRISTIAN BROTHERS | Defendant |
| and | |
| CATHOLIC CHURCH INSURANCE LIMITED | Non-party/Appellant |
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JUDGE: | John Dixon J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 2 March 2023 |
DATE OF JUDGMENT: | 5 April 2023 |
CASE MAY BE CITED AS: | Smith v Trustees of the Christian Brothers |
MEDIUM NEUTRAL CITATION: | [2023] VSC 171 |
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PRACTICE AND PROCEDURE – Appeal from associate judge – Subpoena objection – Whether legitimate forensic purpose – Whether subpoena seeks ‘fishing expedition’ or whether it is ‘on the cards’ that the results of the subpoena would materially assist the issuing party’s case – New evidence on appeal establishing factual error – Whether subpoena ‘fishing expedition’ affected by fact that subpoenaed party not a disinterested non-party.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff/Respondent | Mr J Gordon | Rightside Legal |
| For the Defendant /Second Respondent | Mr J Ruskin KC with Mr J Hooper | Barry Nilsson Lawyers |
| For the non-party/Appellant | Mr A Strahan KC with Ms G Berlic | Gilchrist Connell |
TABLE OF CONTENTS
Background......................................................................................................................................... 1
Principles............................................................................................................................................. 3
Reasoning of the primary judge...................................................................................................... 5
CCI’s submissions............................................................................................................................. 6
The plaintiff’s submissions........................................................................................................... 10
Analysis.............................................................................................................................................. 16
HIS HONOUR:
Background
A subpoenaed party, Catholic Church Insurance Limited (CCI), appealed against the order of an associate judge dismissing CCI’s objection dated 11 April 2022 to the plaintiff’s subpoena dated 1 April 2022.[1] I accepted that circumstances had changed since the hearing before the primary judge and that it was appropriate to permit the parties to file further affidavits. Although the primary decision concerned two proceedings (the Smith proceeding and the Pearce proceeding), the Pearce proceeding took a different course[2] and is not presently relevant.
[1]Smith v Trustees of the Christian Brothers; Pearce v The Corporation of the Society of the Missionaries of the Sacred Heart [2022] VSC 343 (primary reasons).
[2]Pearce v Missionaries of the Sacred Heart [2022] VSC 697.
Briefly, the plaintiff, Mr Smith, by his proceeding seeks damages arising from alleged historical childhood sexual abuse. Mr Smith had made an earlier claim against the same defendant, prior to commencing this proceeding, which was settled by a Deed of Settlement (Deed). The defendant has pleaded the Deed as a complete defence to the claim against it. The plaintiff has applied to set aside the Deed pursuant to s 27QD of the Limitation of Actions Act 1958 (Vic) (the Deed application).
An important issue arising on the Deed application is that prior to the enactment of the Legal Identity of Defendants (Organisational Child Abuse) Act 2018 (Vic), a prospective plaintiff could not sue an institutional defendant that was an unincorporated association if the Ellis defence was taken. An Ellis defence is a reference to Trustees of the Roman Catholic Church v Ellis,[3] in which the New South Wales Court of Appeal held that the Catholic Archdiocese of Sydney is an unincorporated association and accordingly cannot sue or be sued in its own name. The court found that neither the current archbishop nor a trustee corporation set up for the purpose of holding church property under the Roman Catholic Church Trust Property Act1936 (NSW) could be found liable for the perpetrator’s actions or the negligence of the archbishop who appointed him.
[3]Trustees of the Roman Catholic Church v Ellis (2007) 70 NSWLR 565.
It was open to the defendant to rely on this principle in any proceeding taken at the time the Deed was negotiated.
Mr Smith contends that it is reasonable that the Deed be set aside as he believed that the defendant could and would take the Ellis defence if he commenced a proceeding and did not accept a pre-trial offer of compromise that he considered to be unreasonably low. CCI is not a party to the Deed application, but was the insurer for the defendant and instructed the lawyers who defended Mr Smith’s original claim and negotiated the Deed.
In compliance with trial management directions, the parties put on their evidence for the Deed application. CCI’s servants and agents had provided the entirety of the evidence filed for the defendant in the Deed application. In that context, Mr Smith issued a subpoena to CCI seeking documents relating to the Ellis defence, and the primary judge declined to accept CCI’s objections to the subpoena.
When considered by the primary judge, the subpoena sought the following categories of documents:
1.In any litigated proceedings, against the Christian Brothers (including the Order, Congregation or Provincial) or the Trustees of the Christian Brothers notified or commenced between 2015 and 2018 which was indemnified wholly or partly by CCI, unredacted copies of:
(a)any defence(s) or draft defence; and any document recording discussion, instructions, decision making, press releases, public statements, file notes, or correspondence relating to the Ellis Defence, defendant identity, or legal defences which might colloquially be called the Ellis Defence.
2.Any instruction, riding instruction or standing instruction from CCI to any lawyer acting on its behalf or in its interest, issued between 2015 and 2018 directing, instructing or requiring that any Ellis Defence not be taken (or to be taken) in litigated proceedings for institutional childhood sexual abuse against any entity insured by CCI.
However, further discovery filed and served on 10 June 2022 and answers to interrogatories filed and served on 22 June 2022 has narrowed the issues.
The dispute between CCI and the plaintiff has further narrowed since the submissions for this appeal were prepared. CCI concedes that a properly drawn subpoena could be issued to CCI requiring it to disclose:
(a)copies of any filed defence that pleads the Ellis Defence in any legal proceeding issued against the entity known as the Christian Brothers (including the Order, Congregation or Provincial known as the Christian Brothers) or a trustee of a trust holding assets for the benefit of the Christian Brothers, that was indemnified wholly or partly by Catholic Church Insurance Limited and was commenced, or alternately notified to Catholic Church Insurance Limited, between 2015 and 2018;
(b)all documents evidencing or disclosing instructions to serve the defences disclosed pursuant to subparagraph (a) above;
(c)all documents evidencing or disclosing deliberations by CCI or the defendant or their advisers in relation to the decision to serve the defences disclosed pursuant to subparagraph (a) above.
What CCI resists is being required to search for and disclose the ‘standing or riding instruction or direction’ said by the CCI witnesses to have governed its deployment and use of the Ellis defence in the relevant period, which is the first category of documents sought by the plaintiff.
CCI submitted that the costs of searching for and producing the categories of documents sought by the plaintiff (whether or not the ‘riding instructions’ category is included) will be very substantial. CCI seeks orders clarifying that the costs of searching for and producing whatever categories of documents are ordered will be treated as the costs of compliance with the plaintiff’s subpoena and claimed under the Supreme Court (General Civil Procedure) Rules 2015 (Vic) on that basis.
Principles
It is well accepted that the nature of an appeal from an associate judge to a judge of the trial division is an appeal by rehearing. CCI, as the appellant, is required to show legal, factual, or discretionary error before appellate power may be exercised.[4] As the order under appeal relates to a matter of practice and procedure, caution is exercised when reviewing the primary decision. The court reviews the primary decision on the basis of the evidence before the primary judge but may grant leave for further evidence to be filed, draw inferences of fact, give any judgment or make any order that ought to have been given or made and make any further or other order as the case may require.[5]
[4]Supreme Court (General Civil Procedure) Rules 2015 (Vic) r 77.06. Numerous decisions to this effect following on Oswal v Carson [2013] VSC 355 are collected in para I 77.06.0 of Bailey D and Arthur J, Civil Procedure Victoria (LexisNexis).
[5]Rule 77.06.9 of the Rules; Chiodo Investments Pty Ltd v Rilac Pty Ltd [2023] VSC 32, [26]-[27].
Where a subpoenaed party applies to set aside a subpoena, the issuing party must satisfy a two-part test. It must:
(a) identify precisely a legitimate forensic purpose for categories of documents sought pursuant to the subpoena, bearing in mind that both the production of documents or the absence of produced documents may assist a forensic purpose; and
(b) demonstrate that it is ‘on the cards’, or that there is a ‘reasonable possibility’, that the documents will ‘materially assist’ the issuing party’s case.
The primary judge applied the summary of principles identified by Derham AsJ in ACN 096 450 770 (fka AJH Lawyers Pty Ltd) v Mathieson Nominees,[6] following his Honour’s review of the cases, and neither party submitted that it was inappropriate for the primary judge to do so. There was no dispute before me as to the principles governing the application. In Mathieson, the court said:
[6][2017] VSC 559.
(a)it is necessary for the party at whose request the subpoena was issued to identify expressly and precisely the legitimate forensic purpose for which access to the documents is sought;
(b)except in cases where the subpoena is plainly too broad or merits the description of a fishing expedition, the judge should normally inspect the documents for the purpose of making a final decision as to whether a legitimate forensic purpose exists;
(c)however, the Court will not require production of subpoenaed documents, and will not permit access to subpoenaed documents, if the subpoena is expressed so broadly that the applicant cannot demonstrate, having identified a forensic purpose, that it is ‘on the cards’ or that there is a ‘reasonable possibility’ that the documents will materially assist the case of the party;
(d)a ‘fishing expedition’ is not a legitimate forensic purpose and will not be permitted;
(e)the relevance of a document to the proceeding alone will not substantiate an assertion of legitimate forensic purpose. There is no legitimate forensic purpose if the party is seeking to obtain documents to see whether they may be of relevance or of assistance in his or her case;
(f)a mere assertion of bad faith by an applicant or that something might be found demonstrating bad faith is not enough – the criteria set out in (c) must be satisfied; and
(g)where a party fails to demonstrate a legitimate forensic purpose, the Court should refuse access to the documents and set aside the subpoena.[7]
[7]Ibid [20] (citations omitted).
Reasoning of the primary judge
The primary judge, dealing with applications on behalf of both Mr Smith and Mr Pearce, noted that the parties had filed their evidence on the Deed application, which demonstrated that in issue was whether the plaintiffs settled their claims on a conservative basis because of the existence of the Ellis defence, in circumstances where the defendant’s evidence was that they would not have relied on the Ellis defence and this was known or should have been known by the plaintiffs. The legitimate forensic purpose in seeking the documents from CCI was to establish whether the defendant did in fact plead the Ellis defence during the period in which their evidence was that they had stopped doing so. The defendant’s evidence identified ‘standing or riding instructions’ not to take the Ellis defence. The source, scope and terms of those standing or riding instructions and the extent to which they were unwaveringly followed were clearly in issue on the Deed applications.[8]
[8]Primary reasons, [51] (n 1).
CCI did not contest this finding of legitimate forensic purpose. It contended, first, that the documents sought might not be relevant to the identified forensic purpose, eg, draft defences that were not filed or documents indicating instructions that the Ellis defence ‘not be taken’. Secondly, it contended that the application of the second limb of the test was the occasion of error. The primary judge said:
There is a reasonable possibility that the documents sought, to the extent they indicate the terms and scope of the instructions and their application or non-application in practise, will materially assist the plaintiffs’ cases. This is because the documents are likely to demonstrate the status and scope of the instructions about when, whether and in what circumstances CCI and the defendants relied upon the Ellis defence in settling claims prior to the Legal Identity Act coming into force.[9]
[9]Ibid [52].
Continuing, the primary judge noted that the defendant had stated that the litigated claim files from the relevant period could not be identified and that it was unclear whether the defendant’s files included the documents sought by the subpoenas to CCI. They have not been discovered. The primary judge rejected CCI’s submission that by the subpoenas the plaintiffs are effectively seeking discovery, instead finding that the scope of the documents sought went directly to an issue in contest in the Deed applications. CCI’s submission that the subpoenas represented a fishing expedition was also rejected.
The primary judge was informed that there would be less than 55 claim files relevant to Mr Smith’s proceeding and the costs of compliance with the subpoena were thought to be in the order of $33,500. By reference to the affidavit of Jessica O’Dell filed on behalf of CCI, substantially greater figures were asserted, falling in a range from $180,100 to $693,700, although they were an assessment of the costs of complying with the subpoenas in both the Smith and Pearce matters. These assessments relate to searches of the entire relevant CCI database, which Ms O’Dell described. The greater estimates relate to searching beyond the claims database and needing to manually search paper files. The primary judge concluded that ‘the time and cost estimated to respond to Mr Smith’s subpoena, while perhaps not modest, is not so burdensome as to be oppressive.’ This finding has not been challenged, because the costs of compliance are being reserved to another day.
CCI’s submissions
In summary, CCI submitted that the primary judge’s error was that the subpoena power cannot be not used by a party to merely obtain documents from a non-party that may relate to an issue in contest in the proceeding. Something more is required. It must be ‘on the cards’ that the documents sought will ‘materially assist’ the issuing party’s case. Mr Smith did not, and could not, demonstrate this requirement in respect of the subpoena and it ought to have been set aside.
The eight grounds of appeal identified in the notice of appeal fall into three categories.
First, the primary judge, while identifying the correct test, erred in its application. In substance, CCI submitted that the primary judge accepted the plaintiff’s submission that the identified categories of documents were relevant, but the plaintiff led the judge into error because he did not attempt to meet the second part of the test and show that it was ‘on the cards’ that the subpoenaed documents would assist his case; he did not advance an argument that it was likely that relevant documents did exist, and they would (or were likely to) undermine rather than corroborate the defendant’s claims. The judge did not address this deficiency and only touched on the issue in the paragraph of his reasons that I have quoted (at [16]).
CCI submitted the reasoning in that paragraph was circular, with the first sentence merely asserting the conclusion that the second limb of the test was satisfied, while the second sentence, without any reasoning, simply restated the potential relevance of ‘the documents’ to a fact in issue. It was erroneous to conclude that, because ‘documents’ could be relevant, the plaintiff had engaged the critical question of whether it was on the cards that the documents would materially assist him. Mr Smith did not, and could not on the evidence, establish that the documents sought would satisfy the second limb of the test.
There was no evidence before the court capable of supporting that finding,[10] but further, Mr Smith had expressly conceded that he did not know whether the documents sought pursuant to the subpoenas would ‘confirm or contradict’ the defendant’s evidence. The unchallenged evidence was that those persons with responsibility for negotiating settlements were subject to standing or riding instructions not to take the Ellis defence. CCI submitted that such evidence as there was suggested that if there were any documents, they would most likely assist the defendant. What could not be disputed was that Mr Smith did not know whether the subpoenaed documents existed and if they did, what they would likely say. CCI contended that it followed that there was no evidence available to show that the documents sought would materially assist his case.
[10]The primary judge summarised the evidence at primary reasons, [24]-[32] (n 1).
The second category of appeal ground is that the subpoena was an impermissible fishing expedition. CCI submitted that the documents were sought to see whether they would assist Mr Smith’s case and that the primary judge did not adequately reason his rejection of the submission. Mr Smith had conceded what he did not know about the documents and the primary judge expressed his legitimate forensic purpose finding consistently with that concession.
I am satisfied that the plaintiffs have identified a legitimate forensic purpose in seeking the documents: to establish whether the defendants did in fact plead the Ellis defence during the period in which their evidence is that they had stopped doing so.[11]
[11]Primary reasons, [51] (n 1).
CCI submitted that to seek by way of subpoena production of documents from a non-party in order to find out whether or not documents exist and, additionally, to find out whether those documents, if they exist, support or contradict a fact in issue, is the very definition of fishing[12] and an improper use of the subpoena power.
[12]Citing Commissioner for Railways v Small (1938) 38 SR (NSW) 564, 575; Associated Dominion Assurance Society Pty Ltd v Sir John Fairfax & Sons (1952) 72 WN (NSW) 250, 254, as cited in Matthews v SPI Electricity Pty Ltd (No 12) [2014] VSC 131, [40]. See also Woolworths Ltd v Svajcer [2013] VSCA 270, [43]-[45]; Messade v Baires Contracting Pty Ltd [2011] VSC 56, [8]-[9]; Walters v Perton [2019] VSC 356, [66].
CCI further submitted that the primary judge erred in the application of the second limb of the test when rejecting its contention that the subpoena constituted a substitute for discovery.[13] The primary judge reasoned by reference to the concept of relevance, (legitimate forensic purpose), rather than applying the second limb of the test – whether the plaintiff had demonstrated that it is ‘on the cards’ that the documents will ‘materially assist’ him. There are sound policy reasons, reinforced by reference to the overarching purpose in civil litigation, for a different test to be applied to a non-party required to undertake extensive searches. That, CCI contended, is particularly so where the evidence shows the search is for documents that are unlikely to exist, or if they do exist are likely to assist the defendant.
[13]Primary reasons, [53] (n 1).
Thirdly, the analysis in respect of the two groups of grounds of appeal already discussed demonstrated that the primary judge did not provide reasons that explained, either in short compass or otherwise, how and why one party succeeded, and the other party lost.[14]
[14]Citing Transport Accident Commission v Kamel [2011] VSCA 110, [70]–[73]; R&P Boland Nominees Pty Ltd v Hobbs [2013] VSCA 66, [57]-[63].
CCI’s open offer, above at [9] that was made after the primary judge’s ruling, substantially answers the plaintiff’s documentary inquiry in pursuit of its forensic purpose. Defences and instructions will be provided. The pleadings in some nine or ten (depending on whether there has been a doubling up) proceedings have been discovered so far, following a search of 55 litigated claim files.
As for the riding instructions, the defendant’s evidence is that such instructions were not recorded; what is being described is the approach that was taken. An affidavit from Daniel Creasey stated that he wasn’t aware of the riding instructions being recorded in a document. The plaintiff cannot, without more, contend that the court must infer that relevant documents exist. That is not inference but speculation. In this context, CCI relied on an affidavit of Patrick Monahan that deposed to a usual practice not to take the Ellis defence and to take active steps to put before a proposed plaintiff an appropriate solvent defendant. CCI contended that this process was evident in the pleadings that have now been discovered.
CCI accepted the changed circumstances following on the further discovery and the answers to interrogatories, but it submitted that its redrafted subpoena offer met those circumstances. To the extent that Mr Smith pressed for a more extensive response, CCI submitted that its objections to the subpoena were good and must be upheld.
It would not be possible, except by conducting an extensive and expensive search process, for CCI to depose affirmatively that there are no documents falling into the categories identified by the subpoena. An arduous page turning paper file search would be needed. CCI submitted this process would be unwieldy and disproportionate, because there is no evidence that the riding instruction was ever incorporated into a document. Further, it is not open to conclude that it is on the cards that any documents that might be turned up in such a search will materially assist the plaintiff.
Although CCI would not press costs issues were the plaintiff to accept the redrafted subpoena offer, it did reserve its opportunity, provided by the Rules, to recover compliance costs that may be hundreds of thousands of dollars.
The plaintiff’s submissions
The plaintiff noted what he submitted was a critical factor: that the defendant’s evidence, emanating from CCI, was that, when the Deed was agreed, the Ellis defence was not a barrier to further litigation because CCI had a standing or riding instruction that it would not take the Ellis defence, that it had at the relevant time offered to some lawyers a ‘proper defendant’ to sue (which would, it is claimed, obviate the ability to successfully take the Ellis defence) and that the plaintiff’s lawyers knew or should have known that the defence would not be raised in any litigated proceedings.
Mr Smith rejected CCI’s contention that he was searching for a ‘smoking gun’.
Mr Smith had a legitimate forensic purpose in seeking documents relating to this claim. Specifically, he sought:
(a) the standing or riding instructions or directions said by the CCI witnesses to have governed its deployment and use of the Ellis defence in the relevant period (sought for the clear forensic purpose of demonstrating that the instruction did not contain the unconditional and invariable direction and instruction that the recollections of the CCI witnesses suggested);
(b) The consideration given by CCI to, and the deployment of, the Ellis defence, in litigated claims brought against the defendant in the relevant period 2015-2018 (sought for the clear forensic purpose of demonstrating that despite the suggestion that the Ellis defence would not be taken, the defence had been taken and that CCI continued to consider using the defence until it was abolished by the Legal Identity Act in 2018).
His forensic purpose was, firstly, to corroborate and confirm his belief that in 2017 he had to overcome the barrier of the Ellis defence if he chose to reject the offer and litigate his claim and, secondly, to contradict the evidence that the Ellis defence was not a barrier that would have been used at the time. He submitted it was, undoubtedly, on the cards that the contemporary records would likely demonstrate these purposes. However, I note that the submission was that this expectation was what the plaintiff believed. If that belief could be proved, it would materially assist his position in the Deed application.[15] Mr Smith submitted that the conduct of the Deed application brought by Mr Pearce and heard by Forbes J confirmed the legitimate forensic purpose he had identified.
[15]Roman Catholic Trusts Corporation for the Diocese of Sale v WCB (2020) 62 VR 234.
In response to the contention that he was fishing, Mr Smith stressed the centrality of the ‘documents’ to the critical issue in dispute. He submitted that his:
belief that reference to documentation from the relevant period sought in the subpoena would contradict the affidavit evidence served in the deed application was borne out; the Defendant did not cease pleading the Ellis Defence in the relevant period. The claims and circumstances in which that would occur (to establish that there was no reason why it could or would not be pleaded in the Plaintiff’s claim) will likely be established on the basis of the subpoenaed material, in particular the standing instructions and the internal consideration by CCI of how and when the defence would be deployed. The Respondent believes that there was no relevant restriction or instruction which would have prevented the use of the defence in his claim. Should he establish that to be true he will have significantly enhanced his prospects of succeeding in setting aside the deed. For that forensic purpose he maintains the position that the subpoenaed documents are relevant and required.
He submitted that relevant litigated claims documents as sought and the evidence of the repeated use of the term ‘standing’ or ‘riding’ instruction in the evidence of CCI’s servants and agents, gave rise to the compelling inference that there must be, or must have been, a document which recorded that instruction, as would be expected given its importance and widespread use. Accordingly, there was a reasonable basis to suppose that CCI had documents of the particular type sought and the subpoena was not and could not be a fishing expedition.
He further submitted:
(a) The Deed application, if lost, had the potential for significant adverse consequences for him.
(b) CCI is not a stranger to the proceedings, having conducted the defence on behalf of its insured and having been involved in hundreds of claims for damages for child sexual abuse brought in this court and through ADR over the last 30 years. It cannot contend that it does not know how to respond to the subpoena given its knowledge of institutional abuse claims.[16] The task for CCI of identifying documents falling into the described categories is not comparable with the task for a stranger to ascertain issues and identify the relationship between those issues and documents.
[16]McColl v Lehmann [1987] VR 503.
(c) The Deed application is in the nature of a test case, being the first application to set aside a deed under the 2019 legislation in respect to a claim brought and resolved by deed of release after the abolition of limitation period and before the enactment of the Legal Identity Act.
(d) CCI’s evidence for the Deed application included documents selectively chosen from CCI files, which demonstrates that CCI can readily examine its past files (whether litigated or not) to recover and produce documents that it needs to support its own case.
(e) Given that the defendant – having gone to CCI’s records to obtain documents – has not produced any document setting out the riding instruction nor the documents from litigated claims, which demonstrates that it did not take the Ellis defence in Christian Brothers claims (or did not preserve its right to do so) in the relevant period, the respondent proceeds on the interim assumption that CCI cannot do so.
(f) There were only 55 relevant litigated claims in the relevant period. CCI witnesses managed these claims for CCI and its insured parties, including the Christian Brothers, in the relevant period.
(g) The further discovery provided since the hearing before the primary judge included pleadings from nine litigated claims against the Christian Brothers in the relevant period. The further answers to interrogatories admit, first, that the defendant had pleaded the Ellis defence in the relevant period in one case (with what Mr Smith submitted was a tendentious explanation for the pleading) and, second, that the defendant had not advised the plaintiff’s lawyers that the Ellis defence would not be taken in his claim.
(h) Given the extent of the references to the riding instructions in the defendant’s evidence, it is inconceivable that at no time was it contained in a CCI instruction or document, nor written down by any of the CCI servants or agents who are giving evidence and who assert the primacy of the instruction upon their actions in the relevant period.
(i) Mr Smith was never told any of the matters deposed to by Mr Monahan about CCI’s approach to and instructions about the Ellis defence, which appears from the affidavits of Mr Monahan and Mr Creasey. This raised the issue of whether the practice Mr Monahan was describing applied in every case and whether there was a disconnect between what was said and what was done that are factors relevant to the Deed application.
(j) It also raised an issue of whether all applicants for compensation ought to have been aware of CCI’s attitude to taking the Ellis defence.
(k) Mr Smith was looking for material that showed what CCI was actually doing as opposed to what its witnesses now recalled was its approach. He is not looking for a smoking gun. If their approach was adopted in every case, the failure to communicate that approach to Mr Smith becomes compellingly significant. If it was not, then the defence remained a forensic weapon that might be deployed as Mr Smith feared. So, Mr Smith submitted, the documents would be likely to materially assist his application whatever they revealed.
(l) CCI has now had more than six months since the subpoena was issued, and four months since the order under appeal, to review and assemble the documents sought. No stay of the order has been sought and nothing has been produced.
Mr Smith submitted that the primary judge correctly applied the test, evident from his reasoning in the primary reasons at paragraphs [50] – [56]. There was evidence that supported the primary judge’s conclusion that there was a reasonable possibility that documents would materially assist the plaintiff. The defence was then lawfully open to the defendant. Whether it was pleaded would be a matter for instructions and CCI, as the indemnifying insurer, would be interested in the question. The plaintiff argued that what was produced to him with the evidence filed by the defendant did not come from the plaintiff’s claim, but from other claims not involving the Christian Brothers and without any contemporaneous record of the riding instructions. The evidence put on by the defendant speaks in general terms of an ‘instruction’ and a ‘policy’ and does so against a background of substantial analysis and criticism of the Ellis defence in public reports. The court can infer that it is a reasonable possibility that the Ellis defence was kept open for deployment and was probably pleaded in litigated claims by defendants. This, the plaintiff contended, will be what is revealed and confirmed by the subpoenaed records.
Thus the evidence underpinning the forensic purpose of the subpoena was manifestly before the court and his Honour appropriately drew the inference from it that it was reasonably possible that it would materially assist the plaintiff’s case. This inference may more readily be drawn now that the defendant has admitted pleading the Ellis defence in one case and that it did not give advice to Mr Smith or his lawyers of the kind identified by Mr Monahan. These matters admit the possibility that the defendant did not always comply with the riding instruction.
Accordingly, the primary judge was correct to conclude that it was on the cards that the documents would materially assist the plaintiff in the Deed application. The documents identified by the categories are whatever relates to a consideration of the Ellis defence in the 46 litigated claim files, irrespective of what any particular document says. There is no focus on any particular document. The plaintiff is concerned about the operation of the system or approach that Mr Monahan described.
Because the primary judge properly found that documents sought would materially assist the plaintiff’s case, it was inevitable that the subpoena was not a fishing expedition.
Mr Smith submitted that being limited, as it now is, to the 46 litigated claim files, it is not now, although it never was, the significantly onerous task that CCI asserts. So much may be inferred from the failure of CCI to comply with the subpoena, the operation of which has not been stayed, when partial compliance would have permitted a realistic estimate of the search costs to be substituted for the general range proffered by reference to the O’Dell affidavit. The failure to conduct any search in response to a valid subpoena permitted CCI to continue to contend that the second limb of the test was not satisfied when CCI had identified one litigated claim that showed that the Ellis defence was still being taken in the relevant period. Mr Smith was prepared to confine the subpoena category (2) by reference to the 46 files.
The context for the subpoena remained fixed by the evidence put on for the defendant that CCI’s broad and general approach to taking the Ellis defence across most, if not all, claims was evident from the affidavits of Messrs Monahan and Creasey. The further discovery since the decision under appeal provided evidence that it was on the cards that documents meeting a reasonable description of a category, for a non-party whose relationship to the issues in the proceeding was as proximate as that of CCI, would materially assist the plaintiff on the Deed application. Mr Monahan’s affidavit demonstrates that CCI took a particular approach, not just to pleading the defence, but also to assisting in identification of a proper, solvent defendant. The plaintiff is entitled to test such an assertion. Any document that informs the manner of application of this approach across litigated claims over the relevant period may assist the plaintiff to establish his claim in the Deed application.
While a subpoena to a non-party must specify the documents to be produced with reasonable particularity, it is a factual question in each case whether a degree of generality in the description of a category of documents is compatible with the requirement of reasonable particularity.
Analysis
It is now trite to observe that the court must seek to give effect to the overarching purpose to facilitate the just, efficient, timely and cost-effective resolution of the real issues in dispute in the exercise of any of its powers, or in the interpretation of those powers, howsoever arising.[17] In doing so, the court shall further the overarching purpose by having regard to specified objects and matters.[18]
[17]Civil Procedure Act 2010 (Vic) s 8.
[18]Ibid s 9.
Given that the dispute between the parties to this appeal now lies between the form of the subpoena as drafted and the offer made by CCI, I consider that the overarching purpose is best facilitated by directing CCI to comply with the subpoena as if it were drafted in the following terms:
In respect of any legal proceeding issued against the entity known as the Christian Brothers (including the Order, Congregation or Provincial known as the Christian Brothers) or a trustee of a trust holding assets for the benefit of the Christian Brothers, that was indemnified wholly or partly by Catholic Church Insurance Limited and was commenced, alternately notified to, Catholic Church Insurance Limited, between 2015 and 2018―
(a)in respect of each defence filed in each legal proceeding, all documents evidencing or disclosing instructions or deliberations by CCI or the defendant about pleading or serving that defence, where such instructions relate to whether the Ellis Defence, defendant identity, or any cognate legal defence are, or are not, to be pleaded; and
(b) copies of any filed defence that pleads the Ellis Defence, defendant identity, or any cognate legal defence.
These are my reasons.
Because circumstances have changed, it is appropriate to consider CCI’s objections afresh in the light of the further evidence that I have permitted to be filed. The factual matrix for the objections has changed, meaning the primary decision and order was based on factual error and the court’s powers on appeal are enlivened to give any judgment or make any order that ought to have been given or made or any further or other order as the case may require. Although the order under appeal relates to a matter of practice and procedure, the entreaty to exercise caution when reviewing the primary decision must give way to the changed circumstances.
Although I largely accept the plaintiff’s submissions, I turn next to a submission by the defendant that, although correct on a strict analysis of the primary decision, has been overtaken by events.
I agree with the defendant that the original subpoena sought a wide search for any instruction, riding instruction or standing instruction [about the Ellis Defence] from CCI to any lawyer acting on its behalf or in its interest in litigated proceedings for institutional childhood sexual abuse against any entity insured by CCI. This was correctly characterised as a fishing expedition by CCI for the reasons it advanced. Now, by confining the subpoena to specific categories of documents that relate to the defences to be taken in litigated claims against the Christian Brothers commenced or notified between 2015 and 2018, the subpoena will identify categories of documents with a particularity that can be described as reasonably sufficient.
That is so because there are 55 known litigated claims and the categories of documents are now more specifically described, in circumstances where the subpoenaed party required to conduct a search of those files for documents of those classes is not a disinterested non-party in the well-understood sense. In this case, CCI is the insurer of the Christian Brothers and had the conduct on its behalf of the relevant claims, which it did through instructions to experienced solicitors. There is no want of clarity for CCI in terms of the content of any document that will fall into the class. As a test of this proposition, a folder of documents drawn from the 55 files and relating to the defence proposed or filed potentially falling into either of the identified categories could be inspected by the court to assess whether production was required by the subpoena. As the subpoena was originally drawn, that exercise would require the court to search files or inspect documents on the off-chance that something might turn up which could advantage the party seeking production. The dividing line is between documents and files.
The applicable principle can be expressed in this way. In a case in which legitimate forensic purposes referable to particularised categories of subpoenaed documents has been identified, and the question arises whether documents are relevant to that purpose, the court will not require production of, or permit access to, subpoenaed documents, if the subpoena is expressed so broadly that the applicant cannot demonstrate that it is ‘on the cards’ that the documents described in the subpoena will assist the identified forensic purposes. That will be so where the description of the documents is a description of files with a bare unsupported assertion that on an inspection of those files something may be found which is helpful. A judge would be inspecting the files on the off-chance that something might turn up which could advantage the party seeking production, or, in other words, fishing.
Next, I accept that the plaintiff has shown a legitimate forensic purpose. CCI did not contend otherwise, although it characterised the plaintiff’s forensic purpose as an analysis of ‘relevance’ in order to dismiss it as insufficient. I do not accept that all the plaintiff could do was show that documents may be relevant without demonstrating that the documents would not support the defendant’s contentions and might in some way undermine them. The purpose identified by the plaintiff was not singular. The plaintiff alleges dual forensic purposes that operate like two sides of the same coin. It focused on the fruits of the process of response to the subpoena rather than what might be the specific use of any produced document. Legitimate forensic purposes were described by the plaintiff in the submissions noted above at [36].
The third point, which was the main ground argued by CCI, was a contention that the plaintiff did not show that it was ‘on the cards’ that the subpoenaed documents would assist his case; he did not advance an argument that it was likely that relevant documents did exist, and they would (or were likely to) undermine rather than corroborate the defendant’s claims. I was not persuaded by this submission.
First, as to the existence of documents, while the plaintiff may not have advanced an argument to the primary judge that relevant documents existed, since the primary judge’s decision the defendant has admitted both that it had pleaded the Ellis defence in the relevant period in one case (with what Mr Smith submitted was a tendentious explanation for the pleading) and that it had not advised the plaintiff’s lawyers that the Ellis defence would not be taken in his claim. The proper characterisation of the defendant’s explanation for that pleading of the Ellis defence can be examined at trial, if necessary. What is now clear is that documents falling within the identified categories exist.
Secondly, although there is evidence from Mr Creasey that what is described as ‘riding instructions’ were not, as far as he can recall, recorded in any document, there is a legitimate forensic purpose for the plaintiff in testing this contention whatever be produced in answer to the subpoena.
I accept the plaintiff’s submission that whatever be the outcome of compliance with the subpoena, the plaintiff can achieve a forensic purpose from the subpoena. There is a ‘reasonable possibility’ that the response to the subpoena will ‘materially assist’ the plaintiff. It may be inferred at trial that in response to the subpoena, CCI conducted a proper search.
If documents are produced they may assist with one aspect of the forensic purpose described by the plaintiff, namely that the plaintiff’s belief was supported by the fact that the defence was taken, or contemplated, by the Christian Brothers in other claims. Documents that identify whether the Ellis defence was contemplated when it was not in fact pleaded will assist the plaintiff’s forensic purpose in assessing the claimed riding instructions, the consistency of their application and whether such riding instructions were generally known or specifically communicated.
If no documents are produced, the response to the subpoena may assist the other aspect of the plaintiff’s forensic purpose, namely that the defendant did not disabuse the plaintiff of his mistaken notion that the defence would be taken. So much has now been conceded, but it is not the conduct of the defendant and CCI that will be the issue at trial. The focus is likely to be on the reasonableness of the plaintiff’s belief based on evidence about the matters that influenced his decision to settle. A forensic purpose is achieved if the trial court may more comfortably infer that the plaintiff honestly held, and was influenced by, a reasonable belief that he had no option but to accept an unfair settlement. A complete absence of documents may assist a contention that the defendant and CCI never positively waived their right to raise an Ellis defence, which is why the plaintiff held that belief.
There is evidence that riding instructions were given; there is evidence that in carrying out those instructions defendants or potential defendants were not necessarily expressly told that the defence was waived. These contentions will be explored at trial. That is sufficient to raise an inference that it is 'on the cards' that any instruction was nuanced about how the defendant was instructed not to raise the defence, including by not expressly stating to a plaintiff that the defence would not be taken, to leave hanging in the air a belief, such as that claimed by the plaintiff, to improve the defendant’s position in negotiations. It is reasonably possible that CCI’s response to the subpoena will materially assist a legitimate forensic purpose in understanding whether, and how, instructions about the Ellis defence may have been nuanced.
I reach the same conclusion as was reached by the associate judge, although by a different route in the changed circumstances. I add that the terms of the subpoena, as revised, do not admit a submission that an arduous and expensive search must be undertaken.
The appeal will be allowed and the order of the primary judge set aside. In lieu thereof I will order that CCI respond to the subpoena as if it is drafted in the terms set out above at [48]. I will reserve the question of costs pending further submissions, for which directions will be given.
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