Thannhauser v Westpac Banking Corporation

[1991] FCA 898

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JUDGMENT NO. ... -........ . ...--- W B / ~ I

IN THE F E D E ~ L COURT OF AUSTRRLIA 1 po. QG 29 of 1989

QUEENSLAND DISTRICT REGISTRY

GENERAId DIVESION 1

BETWEEN: JOHANNA THANNIWUSER

Applicant

AND: WESTPAC BANKING CORPORATION

Respondent

MINUTES OF ORDER

LTUDGE M I N G ORDER:	PINCUS J.
DATE OF ORDER:	5 SEPTEMBER 1991
PHERE MADE:	BRISBANE
THE COURT ORDERS THAT:

1 .    MFI 7, 8, 9, 10 and 11 can be released into the custody of Mr McDonnell of Feez Ruthning and Mr Broadley of Morris Fletcher and Cross on their

undertaking to be personally responsible for the
return of documents which are taken away by them.

2.    The document corresponding to exhibit JAD3 of the affjdavit of James Alan Demack for the 1984 year be discovered.

3.    The document corresponding to exhibit JAD3 of the affidavit of James Alan Demack for the 1987 year be discovered.

Committee and study them.

4 .    The respondent produce copies of diary memoranda kept on Mr Look's file of such memorando recording discussions of Mr Look with prospective foreign currency loan borrowers where advice or iniormation was given to tliem during tlie 1983, 1904 and 1905 years.

5 .    The notice of motion be adjourned sine die insofar as not dealt with today on the understanding that Mr McDonnell will get the mjnutes of Head Office Credit

.

6.    ThB costs of the notice of motion, nsofar as they

were incurred up tll.1 today, be tax d and paid by k

the respondent to the applicant.

NOTE:  Settlement and entry of orders is dealt with in
Order 36 of the Federal Court Rules.

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IN THE F E D E ~ COURT OF AUSTRALIA 1 No. QG 29 of 1989

QUEENSLAND DISTRICT REGISTRY	1
GENERAL DIVISION	1

BETWEEN: JOHANNA THANNHAUSER

Applicant

AND:

Respondent

CORM: PINCUS J.

m: BRISBANE

m: 5 SEPTEMBER 1991

EX TEMPORE REASONS FOR JUDGMENT

This is an application for further and better

discovery. There are three questions which I will mention in
the order they were raised by Mr. McMurdo, counsel for the

Applicant.

In exhibit JAD3 to the affidavit of Mr. Demack,

which is relied on by Mr. McMurdo, appears a complete copy of

il document which was partially discovered in JAD2. JAD3 seems

to be to be discoverable in whole. The reason it is
discoverable is that it is not relevant merely to credit,
assuming it is correct (as Mr. Sheahan argues) that the
documents relevant to credit are not discoverable. It is
something which happened and which would be admissible in

chief. For example, if it were the case that the manager was

being encouraged to get out as much Euro loan business as

possible, that would be, it seems to me, plainly part of the
factual background of the case which could be proved and would
be relevant.

Mr. Sheahdn speaks as if to determine whether

something is discoverable, you look merely at the pleadings.

If one did that, one might discover almost nothing. One must

approach the matter in the light of the issues which are
emerging and in this Court the issues get a fair bit of
definition because of the practice of delivering affidavits or

statements well in advance of the trial.

It is a difficult task for solicitors for the bank

to give discovery, and I am sure that they approach it in a
very ethical fashion. Nevertheless, it seems to me, if I may
say so, odd that JAD3 was not discovered - and a little

disturbing.

The question which arises, however, is whether

similar documents for 1984 and 1987 should be discovered. The

1984 documents are substantially conceded and it will be

ordered that the document corresponding to JAD3 for the 1984 year be discovered. A similar order will be made in respect to the 1987 year. That seems to cover the period after this transaction in which Mr. Look functioned as a foreign exchange

man.	So there will be orders in respect to the 1984 and 1987
years.

The next matter that was raised by Mr. McMurdo

concerns a document dated 19 January 1988 called a bad and

doubtful debt report/review. On page 4, appears the

following:

"Minutes of Head Office Credit Committee Meeting

21/10/87 commented on proposal

'Proposal deferred on the basis of the existing
personnel circumstances of the debtor (an

elderly widowed lady).

Commjttee requested that other avenues be
explored to seek the debtors co-operation in

improving the Bank's position.'".

I was informed by Mr. Sheahan that a legal officer employed by

the bank has studied the minutes and has formed the view that they contain nothing which bears upon the issues in the case.

I have two remarks to make about that. First of

all, it seems to me desirable, as I have mentioned, that Mr.
McDonnell sttldy the matter himself. Secondly, if the view of
the issues in the case is as narrow as that exemplified by the

decision not to djscover the (as I would have thought) plainly

discoverable materlal in JAD3, then it may be that the view of

the legal officer is not always very reliable.

I have decided to, however, put that matter over and

the application and the notice of motion will be adjourned
sine die insofar as it concerns the minutes of the head office

credit committee meeting. I understand that Mr. McDonnell is

going to get the minutes and have a good look at them and that
can be raised later - for example, at the trial.

The third question is the matter of the memoranda of

Mr. Look. It is common ground that Mr. Look's practice is

relevant and it seems to me plain beyond any serious argument
that the documents which support that practice or do not
support it are relevant. The difficulty which has arisen is
that during the course of hib reply, Mr. McMurdo raised a
broader question, and that is dealings between Mr. Look and
persons other than the applicant which do not correspond to

the document dated 14 May 1984 with which I have been

Mr. McMurdo foreshadowed the possibility that he may

seek broader discovery than documents of the type exemplified
by the 14 May 1984 note. However, it is clear from what Mr.
Sheahan says that the documents corresponding to that of 14
May 1984 can be discovered without any great trouble, and he
has suggested a formula which seems acceptable to me. The
only question is whether or not the discovery should be

confined to the 1984 year or extended to the 1983 and 1985

years.

It seems to me that, although one must not work on

the view that any piece of paper which could conceivably bear
upon the issues should be discovered, it is reasonable to
bracket the year in question as Mr. McMurdo submits. And that
is so because the applicant may derive some assistance from
tracing through changes in Mr. Look's practice - if there were
any - under the pressure of external events, such as the

floating of the dollar and the collapse of the dollar against

the Swis~	franc in 1985
Therefore, I will accept Mr. McMurdo's submissions

with respect to the first question, except that I will not
make an order with respect to the 1988 year. As to the second
question, I will put that over with the remarks that I have
made, and on the understanding that Mr. McDonnell will get the
file and study it. As to the thjrd question, I will accept

dt. Sheahanrs formula but I will. make an order with respect to

the 1983, 1984 and 1985 years.

In this matter, I think that the costs should be

paid by the respondent. It is, as I have mentioned, difficult for the solicitor for the bank to determine just how far to go and how much money to spend on discovery and I am sure they do

their best. But it seems to me here that there has been some

mistake in judgment and the applicant is entitled to the

costs.

The order will be that the costs of the notice of

motion, insofar as they were incurred up till today, be taxed

and paid by the respondent to the applicant.

I certify that this and the
four preceding pages are a
true copy of the reasons
for judgment herein of his

Honour Mr. Justice Pincus.

G GSa.vve-

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Associate

Date 5 Septevhbe l l?l