Twigg v Pitcher Partners Holdings Pty Ltd (No 5)

[2024] NSWSC 1295

Supreme Court

New South Wales

Medium Neutral Citation:

Twigg v Pitcher Partners Holdings Pty Ltd (No 5) [2024] NSWSC 1295

Hearing dates:

On the papers

Date of orders:

11 October 2024

Decision date:

15 October 2024

Jurisdiction:

Equity - Commercial List

Before:

Stevenson J

Decision:

Further disclosure to be made

Catchwords:

CIVIL PROCEDURE – disclosure of documents – where disclosure of documents already given – where party to whom disclosure made contends further disclosure is required – appropriate procedure to adopt in that event – general rule that application should be made by notice of motion for further disclosure – general rule that further disclosure should not be sought by service of notice to produce

Legislation Cited:

Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:

G H Varley Pty Ltd v GCG Distribution Pty Ltd [2022] NSWSC 514

Tony Azzi (Automobiles) Pty Ltd v Volvo Car Australia Pty Ltd [2006] NSWSC 283

Twigg v Pitcher Partners Holdings Pty Ltd (No 4) [2023] NSWSC 109

Texts Cited:

Practice Note SC Eq 11

Category:

Procedural rulings

Parties:

Diane Twigg (First Plaintiff/Respondent)
Twigg Plant Hire Pty Ltd atf The Twigg Family Trust (Second Plaintiff/Respondent)
Ipswich Landfill Pty Ltd atf the Ipswich Landfill Trust (Third Plaintiff/Respondent)
Brooklyn Landfill & Waste Management Pty Ltd atf the Brooklyn Landfill Trust (Fourth Plaintiff/Respondent)
Pitcher Partners Holdings Pty Ltd (First Defendant/Applicant)
Pitcher Partners Investment Services Pty Ltd (Second Defendant/Applicant)
Pitcher Partners Advisors Proprietary Limited (Third Defendant/Applicant)
Maxwell James Twigg (Fourth Defendant)
Twigg Co Pty Ltd (Fifth Defendant)

Representation:

Counsel:
D K Smith (Plaintiffs/Respondents)
N D Riordan (First, Second and Third Defendants/Applicants)

Solicitors:
Roberts & Partners Lawyers (Plaintiffs/Respondents)
Gadens Lawyers (First, Second and Third Defendants/Applicants)

File Number(s):

2022/150914

JUDGMENT

1. The background to this matter is set out in my judgment of 20 February 2023^[1] as follows:

   1. Twigg v Pitcher Partners Holdings Pty Ltd (No 4) [2023] NSWSC 109.

“The late Mr William Twigg founded, and, until his death in 1996, operated a large waste and landfill business. The business was operated through a structure of discretionary family trusts, the beneficiaries of which included Mr Twigg’s wife, the first plaintiff Mrs Diane Twigg, and their three children Frances, Elizabeth and the fourth defendant, Mr Max Twigg …

After William’s death in 1996, the businesses were operated by Max, evidently successfully. In 2007, Max negotiated the sale of the businesses for over $150 million. Apart from three ‘gifts’ of $5 million to each of Diane, Frances and Elizabeth, Max directed the net sale proceeds (‘the Sale Proceeds’) to entities he controlled. He then used those proceeds for his own benefit.

In March 2019, Diane and three companies of which she and her daughters are presently directors, and of which Diane is the sole shareholder, brought proceedings (‘the Earlier Proceedings’) in the Commercial List against Max and companies controlled by Max, including the fifth defendant in the current proceedings, Twigg Co Pty Ltd.

In substance, Diane alleged that Max had breached his fiduciary duties as a director of the corporate plaintiffs by causing those companies to distribute to Max the bulk of the Sale Proceeds; some $130 million.

The Earlier Proceedings were complex. They were resolved by judgments given by Ball J on 31 August 2020, and on 11 December 2020. Before Ball J, Diane and the corporate plaintiffs were, in substance, successful. They obtained orders entitling them to recoveries from Max and his associated companies in the order of $120 million.

On 4 May 2022 the Court of Appeal dismissed Max’s appeal from Ball J’s decision.

Diane and the corporate plaintiffs … have recovered some $30 million from Max and his associated companies.

On 25 May 2022 … the plaintiffs commenced these proceedings against Pitcher Partners. Pitcher Partners was engaged to provide services to the Max Twigg group at the relevant times and, it is alleged, to Diane.

The plaintiffs have also joined Max … as [a] defendant.

The plaintiffs allege that Pitcher Partners breached fiduciary duties owed to them and knowingly assisted in a fraudulent design or plan undertaken by Max in respect of the misuse of the Sale Proceeds …

Diane and the plaintiffs seek to recover from Pitcher Partners equitable compensation being the ‘balance of their losses’, that is some $120 million beyond that recovered from Max and his associated companies.” ^[2]

2. At [4]-[18]; footnotes omitted.

2. The proceedings are now listed for final hearing on 17 February 2025 for 10 days.

3. On 28 May 2024, following a successful application by the plaintiffs for discovery before evidence and a contest as to the relevant discovery categories, orders for discovery were made.

4. The parties have since served their evidence in chief.

5. The primary partner at Pitcher Partners responsible for the plaintiffs’ affairs was Mr Adrian Fitzpatrick. Mr Fitzpatrick retired in around 2017. Thereafter, the primary partner responsible for the plaintiffs’ affairs was Mr Stephen Schonberg. Part of the evidence served on behalf of Pitcher Partners is an affidavit made by Mr Schonberg on 5 August 2024. This is the first affidavit Mr Schonberg has given in the proceedings.

6. Another affidavit served by Pitcher Partners was from Mr Robert Ferguson, who made an affidavit on 17 July 2024. The plaintiffs contend that Mr Ferguson has not been mentioned prior to July 2024 as being a person involved in the dispute underlying these proceedings and that he is now presented as a person responsible for applying annotations to company resolutions which are the subject of controversy in the proceedings.

7. Arising out of those affidavits, the plaintiffs contend that Pitcher Partners should make disclosure of documents beyond the categories the subject of the pre-evidence discovery order made on 28 May 2024.

8. However, rather than file a motion seeking such further discovery, the plaintiffs served notices to produce on Pitcher Partners on 22 and 23 August 2024.

9. By notice of motion filed on 13 September 2024, Pitcher Partners seeks to have those notices to produce set aside on the basis that, amongst other things, service of the notices to produce is said to be an abuse of the Court’s process.

10. As a practical expedient, when the motion was called over on 4 October 2024, I directed the parties to prepare a Redfern Schedule setting out the substance of their differences in relation to the further documents sought. Such a Redfern Schedule was promptly produced. I am grateful to the parties for the industry that was obviously involved in the creation of that document.

11. I have now populated the Redfern Schedule with my rulings in relation to the further disclosure sought. That document has now been circulated to the parties. The parties have now, again with commendable promptness, agreed the orders necessary to give effect to those rulings.

12. In effect I treated the service by the plaintiffs of the notices to produce as an application for further discovery and, rather than determining whether, in this case, the plaintiff should file a motion for further discovery, resolved the substance of the dispute between the parties.

13. In these circumstances, the occasion arises for the Court to state the procedure that should be followed in cases such as this.

14. In that regard, my attention has been drawn to the decision of Brereton J, as the Commissioner then was, in Tony Azzi (Automobiles) Pty Ltd v Volvo Car Australia Pty Ltd ^[3] and the later decision of Robb J in G H Varley Pty Ltd v GCG Distribution Pty Ltd. ^[4]

    3. [2006] NSWSC 283.

    4. [2022] NSWSC 514.

15. Those cases establish that the general rule, and what Robb J referred to as the orthodox position,^[5] is that a party seeking production of additional documents after the other party has given discovery should, by notice of motion, seek an order for further and better discovery rather than, as happened here, serve a notice to produce calling for such documents.

    5. Ibid at [15].

16. This is to preserve the integrity of the discovery process under Uniform Civil Procedure Rules 2005 (NSW), r 21.2. ^[6]

    6. Ibid at [20].

17. Indeed, to proceed by way of notice of motion rather than further discovery could well constitute an abuse of process. ^[7]

    7. Tony Azzi (Automobiles) Pty Ltd v Volvo Car Australia Pty Ltd (supra) at [11].

18. Where, as in this case, the first round of discovery was given prior to the service of evidence, a factor relevant to whether further discovery should be given will be whether matters arising from the subsequently served evidence warrant further discovery. That was the principal reason why, in this case, I have required Pitcher Partners to make disclosure of the further documents sought by the plaintiffs.

19. It must, of course, be borne in mind that, in this division, requirements of Practice Note SC Eq 11 must also be satisfied such that, leaving aside discovery before evidence, there will be no order for discovery unless it is shown to be necessary for the resolution of the real issues in dispute between the parties.

20. It may be, as Robb J observed,^[8] that “forensic issues may emerge during the final preparation for hearing and during the hearing that justify the Court in permitting a party to serve on another a notice to produce requiring production of a limited number or class of documents at short notice”.

    8. G H Varley Pty Ltd v GCG Distribution Pty Ltd (supra) at [20].

21. But that should be seen by the profession as being the exception and not the rule and not a course that will be permitted if, as was the case in Azzi v Volvo, oppression would thereby be visited on a party receiving the notice to produce. ^[9]

    9. Supra at [8].

22. Unless there are exceptional circumstances warranting a different course, the Court, especially in this List, will expect that parties follow the general rule to which I have referred.

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Endnotes