Walker Charlotte Street v Rio Tinto Services
[2014] NSWSC 534
•02 May 2014
Supreme Court
New South Wales
Medium Neutral Citation: Walker Charlotte Street v Rio Tinto Services [2014] NSWSC 534 Hearing dates: 02/05/2014 Decision date: 02 May 2014 Jurisdiction: Equity Division - Commercial List Before: McDougall J Decision: Two subpoenas set aside. Other subpoenas to stand, on condition that plaintiff pay $60,000.00 on account of costs of compliance.
Catchwords: PROCEDURE - Subpoenas - application to set aside - whether subpoenas should be set aside where documents already likely to have been provided as part of discovery - whether other subpoenas should be upheld on condition that one party pay costs of production and review. Legislation Cited: Civil Procedure Act 2005 (NSW) Category: Procedural and other rulings Parties: Walker Charlotte Street Pty Limited (First Plaintiff)
Walker Corporation Pty Limited (Second Plaintiff)
Rio Tinto Services Limited (First Defendant)
Rio Tinto Shared Services Pty Limited (Second Defendant)
Martin Christie (Third Defendant)Representation: Counsel:
M Hall / L Thomas (Plaintiffs)
E Hyde (Defendants)
Solicitors:
King & Wood Mallesons (Plaintiffs)
Norton Rose (Defendants)
File Number(s): 2012/87515
Judgment - Application to set aside subpoenas
HIS HONOUR: The fundamental issues that will ultimately require to be decided in this litigation seem to be whether one or other of the defendants was bound to lease premises in Brisbane from one or other of the plaintiffs; whether the relevant defendant is estopped from denying that it was so bound; whether the relevant defendant is guilty of misleading and deceptive conduct on what in any event were the negotiations for such a lease; and whether the defendants in any event, are liable to the plaintiffs on some quantum meruit or restitutionary basis for costs said to have been incurred by the plaintiff in getting the premises ready for the defendants' occupation. That may be an insufficient summary of the litigation but it will do for present purposes. That is because what I am concerned with at present is an application to set aside subpoenas.
The background to the application is that, with an irrelevant limitation, general discovery has been ordered and has been given. The plaintiffs say that they were forced to have a second crack at the defendants' discovery, to compel production of documents that should have been, but were not discovered. Again, that is irrelevant because at this stage there is no further challenge to the sufficiency of the discovery made.
It appears to be common ground, and in any event I proceed on the assumption, that the defendants retained a number of consultants in
connection with their proposed lease of the relevant building. Those consultants included a real estate letting agent (CBRE) and a project manager (Paragon). The role of CBRE is probably self-evident. The intended role of Paragon was apparently to manage the process of ensuring that the premises were suitable to the defendants' requirements. In addition the defendants required a quantity surveyor (MBM), an interior designer (Geyer), an engineering consultant (Aurecon) and some form of technology consultant (Loupis).
The subpoenas in question have been issued to those consultants. In very broad outline, they seek production of all documents that the consultants may have relevant to their respective participation in the events in question. In some cases, those subpoenas replace earlier and much broader subpoenas, which earlier subpoenas were, with a very small exception, set aside.
There was some challenge to the adequacy of the drafting of the schedule to the current subpoenas but since I do not think that the schedule is in any way unclear or misleading I do not propose to deal further with it.
The real question has to be considered in respect of two different categories of subpoena. The first category is the subpoenas addressed to CBRE and Paragon. I should note that those parties, together with the defendants (and with the other consultants), have joined in the application to set aside the subpoenas.
The argument in respect of CBRE and Paragon is that those entities were required to provide their documents, to enable the defendants to comply with their obligations under the discovery order, and they did so. Thus, it is said, to the extent that there is anything relevant in the documents produced, it has been made available to the plaintiffs already.
At some stage, there was a challenge to the adequacy of the request for documents. In response to that, the Court was taken to letters sent by the defendants' solicitors to CBRE and Paragon. Those letters were long and detailed, accompanied by long and detailed schedules. They set out with prodigious (I am tempted to say, fulsome) detail the steps that were required to be taken and the documents required to be searched and provided, to enable the defendants to comply with their discovery obligations.
Looking at those letters and considering both their terms and the terms of the schedules to them, I am satisfied that CBRE and Paragon must have understood that they were required to produce everything of any relevance to any aspect of the project. I am satisfied, further, that if they complied honestly with the requirements of them, they would have produced everything.
In the usual way, the documents were reviewed by the defendants' solicitors. It was put for the plaintiffs that this process might have introduced some sort of filter which, without any implication whatsoever of dishonesty or impropriety on the part of those undertaking the review, nonetheless distorted the results because the reviewers may have been looking for things that were different to those for which the plaintiffs wish to search through the documents.
The evidence of the plaintiffs' solicitor, as to her belief that there may be documents that could be caught by the subpoenas that would not have been produced by the discovery, is to my mind, slender.
Bearing in mind the discovery process that has been undertaken, the thoroughness of the instructions given by CBRE and Paragon, the absence of any present challenge to the adequacy of the discovery, the imperatives s 56 of the Civil Procedure Act 2005 (NSW) and the costs and inconvenience of undertaking the exercise that is proposed in respect of CBRE and Paragon, I am not satisfied that there is any sufficient reason for requiring them to comply with the subpoenas.
In substance, I think, in respect of those entities the plaintiffs have fallen far short of demonstrating that there is any likely benefit that would be commensurate with the costs to be incurred.
I accept that to the extent that the costs would include the defendants' costs of having lawyers review the documents produced by CBRE and Paragon, there might be some element of double-counting because that exercise has been undertaken already. But it seems to me that if the argument is that the exercise may turn up further documents which had not been discovered, that of itself indicates that the process of further review could not be said to be unnecessary.
In my view, the subpoenas directed to CBRE and Paragon should be set aside.
I turn to the second category of subpoena: those addressed to the other consultants. Those consultants were not requested to provide documents for the purposes of enabling the defendants to comply with their discovery obligations. I can see that there may be forensic purposes to be served by the service of and compliance with those subpoenas that extend beyond the somewhat blinkered view of the issues in the case that, at least for the purposes of today's date, the defendants put before me.
Although I have grave doubts that the exercise is likely to produce anything of substance, bearing in mind both the minimal (by comparison with the subject matter of the dispute) costs likely to be involved and the ability of the Court to require both that the plaintiffs fund the exercise and that they do so upfront, I do not think that the same considerations, as I have outlined in respect of first category of subpoena, apply.
Taking a generous approach to assessment of the likely costs to be incurred by the subpoenaed parties in producing documents and by the defendants' solicitors in reviewing them, and bearing in mind what seems to me to be the valid consideration that the costs of the parties will include productivity losses which of themselves are difficult to estimate, I have fixed the figure of $60,000 as that which should be paid upfront to fund the exercise.
I acknowledge that this is a figure which is probably incapable of any greater justification than I have given (although it is informed by the estimates in the affidavit of the defendants' solicitor). It is a figure that is fixed without limitation to the right of either the plaintiffs or the defendants or the subpoenaed parties to contend that some greater or lesser sum should be allowed.
Accordingly, on condition that the plaintiffs pay to the defendants' solicitors the sum of $60,000, to be disbursed to the subpoenaed parties and to the defendants' solicitors in respect of the costs of production and review, and with the limitation that I have set out as to the ultimate figure for which anyone might contend, I would allow those subpoenas to stand.
There is a question as to the costs of the notice of motion to set aside the subpoenas. It is said, and does not appear to be challenged, that although the subpoenaed parties themselves as well as the defendants were applicants, the costs have been effectively met by the defendants.
On that basis, bearing in mind that the applicants have achieved some success and that the plaintiffs have achieved some conditional success, I think that the appropriate order as to the costs is that which I expressed provisionally, namely, that the costs of the notice of motion be costs in the proceedings. I so order.
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Decision last updated: 06 May 2014
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