Suncorp Insurance & Finance v Sarcon P/L

[1996] QSC 263

IN THE SUPREME COURT
OF QUEENSLAND

Brisbane  No.1433 of 1994

Before the Hon. Mr Justice Mackenzie

[Suncorp Insurance & Finance v. Sarcon P/L & Ors.]

BETWEEN:
  SUNCORP INSURANCE & FINANCE
  Plaintiff
AND:

SARCON PTY LTD (ACN 010 306 466)
  First Defendant
AND:

LOUIS H HAILEY CONSULTING PTY LTD (ACN 010 373 207)
  Second Defendant
AND:
  LOUIS H HAILEY
  Third Defendant

AND:
  CONRAD & GARGETT PTY LTD (ACN 010 350 633)
  Fourth Defendant

AND:
  PHILLIP KEATINGE
  Fifth Defendant

AND:
  LAWRENCE MICHAEL CUSACK
  Sixth Defendant

JUDGMENT -  MACKENZIE J.

Judgment Delivered 20 December, 1996

CATCHWORDS:           DISCLOSURE - Supreme Court Rules, Order 35 - whether documents must be disclosed where disclosure may lead the defendants to challenge the quantum of the claim for damages - whether certain documents are directly relevant to allegations in issue.

Counsel:W. Sofronoff Q.C. and D. Ryan for the applicants.

R. Holt Q.C. and P. Dunning for the respondent.

Solicitors:  Thynne & Macartney for the applicants.
  Corrs Chambers Westgarth for the respondent.

Date of hearing:                 29 November, 1996

JUDGMENT -  MACKENZIE J.

Judgment Delivered 20 December, 1996

This is an application for disclosure under Order 35.  The applicant relies on the duty to disclose documents directly relevant to allegations in issue in a case (Order 35 Rule 4(1)(b)), and the power of the Court to order disclosure by producing documents for inspection (Order 35 Rule 14(1)(b)), where it appears that there is an objective likelihood that the duty to disclose has not been complied with (Order 35 Rule 14(4)(b)). 
          The action concerns the alleged failure of the defendants in various respects to ensure that asbestos was removed from areas in the Suncorp Building.  The damages claimed include a component of about $2.1M for temporary relocation of staff, fitting-out of offices in a temporary location and associated expenses.  According to the applicants' submissions the classes of documents of which disclosure is sought bear on the questions:-

(a) whether the plaintiff will incur the expenditure or all of the expenditure which it presently alleges will be required in order to remove residual asbestos in the Suncorp centre; and

(b) whether the plaintiff will instead

(i)      develop the Trittons site as its headquarters;

(ii)undertake some other project or make use of other office accommodation in Brisbane for the purpose of accommodating its headquarters. 

Paragraph 26 of the further amended statement of claim alleges loss and damage by having to incur expense in the form of rental costs for substitute premises during the work of removing the asbestos.  A schedule to the Statement of Claim quantifies the expenses under headings of fit-out, relocation expenses and communication.  The amended defence (para.27) alleges that the plaintiff would in any event have occurred such costs in and about refurbishing the building in the normal course of events.  The issue joined by these pleadings is whether the costs of substitute premises would be solely the result of the need to do the remedial work or whether the costs would in part or whole be incurred in any event because refurbishing would have occurred in the normal course of events.  The paragraph in the defence appears to be premissed on the assumption that staff would have to be relocated elsewhere at expense to Suncorp for the work to be done, with the issues being as to what extent the expense of doing so is contributed to by the presence of the asbestos and to what extent it should be mitigated because expense would have to be incurred in any event because of routine refurbishment at some time in the future.  Presumably the implication is that the removal of the asbestos could conveniently be done in conjunction with the refurbishment. 
          The questions of development of the Trittons site as Suncorp's headquarters and the use of other existing accommodation available to Suncorp in my view raise another issue not reflected in the pleadings.  It is whether the cost of relocating staff becomes irrelevant because a decision might be taken in the ordinary course of business and without any influence from the presence of asbestos in the Suncorp Building, in any event to relocate them elsewhere.  This is not reflected in the pleadings as they stand.
          The new Order 35 brings about a fundamental change in relation to disclosure of documents.  By defining the obligation to disclose in terms of a document being directly relevant to an allegation in issue in the cause, the rule in Peruvian Guano Case (1982) 11 QBD 55 is abrogated. Documents which may lead to a train of inquiry which may in turn enable the other party to advance its own case or to damage the case of the party making disclosure do not now have to be disclosed. The obligation to make disclosure now requires direct relevance to an allegation in issue in the cause. This process cannot be divorced from the pleadings. If a document is one which tends to prove or disprove the truth of an allegation in issue on the pleadings it is subject to disclosure but if not there is not an obligation to disclose it..
          Applying this test I conclude that on the pleadings as they stand there is not an obligation to disclose.  The summons is dismissed with costs to be taxed.