Yunghanns v Colquhoun-Denvers (s 29 CPA application)

IIN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION
MAJOR TORTS LIST

S CI 2016 01170

PETER NICHOLAS YUNGHANNS	Plaintiff
v
NICHOLAS COLQUHOUN-DENVERS	Defendant

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JUDGE:	Daly AsJ
WHERE HELD:	Melbourne
SUMMONS FILED:	28 February 2018
DATE OF HEARING:	20 August 2020, further written submissions by the defendant on 28 August 2020, by the plaintiff on 3 September 2020, and by the defendant on 7 September 2020
DATE OF JUDGMENT:	11 June 2021
CASE MAY BE CITED AS:	Yunghanns v Colquhoun-Denvers (s 29 CPA application)
MEDIUM NEUTRAL CITATION:	[2021] VSC 243	(first revision 15 June 2021)

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PRACTICE AND PROCEDURE – Application for declarations, sanctions and compensation under s 29 of the Civil Procedure Act 2010 (Vic) – Overarching obligations – Duties of legal practitioners to the Court – Overarching obligation to disclose existence of documents – Overarching obligation not to mislead or deceive – Overarching obligation to cooperate with other parties and the Court in connection with the conduct of the proceeding – Whether breach of overarching obligations by the defendant and legal practitioners in failing to provide discovery – Yara Australia Pty Ltd v Oswal (2013) 41 VR 302, referred to – Whether application was an abuse of process – Tenth Vandy Pty Ltd v Natwest Markets Australia Pty Ltd [2006] VSC 170, referred to – Whether an order for costs should be made under s 29 of the Civil Procedure Act 2010 (Vic) – Re Wattie; Wattie v Wattie [2019] VSC 701, referred to – Gatto Corporate Solutions Pty Ltd v Mountney [2016] VSC 752, referred to – Babcock & Brown DIF III Global v Babcock & Brown International Pty Ltd [2015] VSC 612, referred to – Sections 20, 21, 26 28 and 29 Civil Procedure Act 2010 (Vic).

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr M D Wyles QC with Mr B K Holmes	Strongman & Crouch
For the Defendant	Dr S A Baron Levi	Batten Sacks Lawyers

HER HONOUR:

Background and procedural history

These reasons concern an application by the plaintiff seeking declarations, sanctions and compensation under s 29 of the Civil Procedure Act 2010 (Vic) (‘CPA’). They concern what will hopefully be the final instalment of a long-running dispute between the plaintiff and the defendant, who are both longstanding participants in the administration and promotion of the sport of polo.

This proceeding was commenced by the plaintiff, Mr Peter Yunghanns, against the defendant, Mr Nicholas Colquhoun‑Denvers (a resident of the United Kingdom) in 2016, claiming that the defendant had defamed him in two emails sent by him to members of the Federation of International Polo (‘FIP’) in November and December 2015 (‘defendant’s emails’). At the relevant time, the defendant was the President of FIP, and had, along with other senior officials of FIP, endured a years-long campaign by the plaintiff attacking their management of FIP. The plaintiff was a longstanding member and benefactor of FIP, and, as recently as 2012 had been a member of the Executive Committee of FIP (‘EC’).

The plaintiff alleged that the defendant’s emails contained imputations that the plaintiff had made false allegations, was dishonest and irresponsible, and was guilty of sufficient misconduct to warrant him being declared persona non grata by FIP.

The proceeding was commenced on 31 March 2016, and was, it is fair to say, bogged down in various interlocutory disputes between that date and the trial of the proceeding, which commenced before T Forrest JA (‘trial judge’) on 30 April 2018. A number of the hearings concerning these interlocutory disputes were before me between 2016 and 2018. Much of the disputation in 2016 and 2017 concerned various iterations of the defence and counterclaim, the first of which was filed on 6 October 2016, with the final version being filed on 23 March 2017. The counterclaim alleged that the defendant had been defamed by three emails published in 2015 and 2016 (‘plaintiff’s emails’), in which the plaintiff was said to have alleged, among other things, that the defendant had mismanaged the financial affairs of FIP.

Further disputes arose during the course of 2017 and 2018, including a dispute about the adequacy of the defendant’s discovery, which was the subject of orders made by me on 6 December 2017 (‘6 December orders’), and which is the dispute underlying the current application. This application was made in a summons filed by the plaintiff on 28 February 2018 (‘CPA summons’).

The CPA summons sought the following relief against the defendant, and Mr Harvey Bruce of Batten Sacks, the solicitors for the defendant:

1.A declaration that Harvey Stephen Bruce (Mr Bruce) contravened sections 20, 21 and 26 of the Civil Procedure Act 2010 by:
(a)making false and misleading statements in material relied upon by Nicholas Colquhoun-Denvers (defendant) in relation to the further discovery sought by the plaintiff in this proceeding, in particular in:
(i)paragraph 8 of Mr Bruce’s affidavit affirmed on 6 December 2017 and filed in this proceeding, namely the statements that specific documents did not exist, when in fact those statements were false;
(ii)an email dated 4 December 2017, comprising Exhibit JGJ-6 to the affidavit of Jonathan Guy Joseph sworn on 5 December 2017 and filed in this proceeding, namely the statement that the plaintiff had already been provided with all documents in the categories the subject of the plaintiff’s discovery application, when in fact that statements was false; and
(iii)a letter dated 29 December 2017, comprising Exhibit HSB-4 to the affidavit affirmed by Mr Bruce on 22 January 2018 and filed in this proceeding, specifically in relation to:
A.the assertion that the reason why the defendant was required to make further discovery in this proceeding was because he consented to an order; and
B.the assertion that the documents discovered by the defendant in his further affidavit of documents sworn on 21 December 2017 “do not meet the test for discovery under rule 29.01.1”; and

(b)failing to correct or explain these false and misleading statements despite written requests from the plaintiff to do so.

2.A declaration that the defendant contravened sections 20, 21 and 26 of the Civil Procedure Act 2010 by:
(a)failing, until 29 December 2017, to disclose to the Court and to the plaintiff:
(i)an email from the defendant to Alexandro Taylor timed at 06:48:31 AM on 3 November 2015, with subject, “In Strictest Confidence” (being document number 2567 in Part 2 of Schedule 1 of the defendant’s further affidavit of documents sworn on 21 December 2017); and
(ii)an email from the defendant to Peter Prendiville timed at 03:41:22 AM on 7 December 2015, with subject, “Re: 88th Ambassadors Cup” (being document 2670 in Part 2 of Schedule 1 of the defendant’s further affidavit of documents sworn on 21 December 2017);

(b)giving false and misleading instructions to Mr Bruce as recorded in paragraph 10 of Mr Bruce’s affidavit affirmed on 5 December 2017 and filed in this proceeding; and
(c)failing to correct or explain these false and misleading instructions despite written requests from the plaintiff to do so.

3. An order under section 29(1) of the Civil Procedure Act 2010 that:
(a)the defendant and Mr Bruce pay the legal costs and disbursements of the plaintiff’s summons filed in this proceeding on 14 November 2017 and the costs of the hearing on 10 November 2017, on a full indemnity basis, and that those legal costs and disbursements be payable immediately and be enforceable immediately; and
(b)paragraph 4 of the order made by the Honourable Associate Justice Daly in this proceeding on 6 December 2017 (being an order that the defendant pay these costs on the standard basis) be vacated.

…

By orders made by J Forrest J on 2 March 2018, the application in the CPA summons was adjourned to a date to be fixed pending the hearing and determination of the trial of the proceeding.

On 28 June 2019, the trial judge delivered his reasons following the trial of the proceeding.[1] The outcome of the trial can be summarised as follows:

(a) with respect to the plaintiff’s claim, the defendant conceded the defamatory nature of the defendant’s emails, was unsuccessful in making out his defences of truth and/or justification, but was successful in his defence that the defendant’s emails were protected by qualified privilege, and that he was not actuated by malice; and

(b) with respect to the defendant’s counterclaim, the plaintiff’s emails were held to be defamatory, but the plaintiff was able to make good his common law and statutory defences of truth and justification.

[1][2019] VSC 433.

No appeal was lodged against the decision of the trial judge in relation to the substantive issues determined at the trial of the proceeding.

The question of the costs of the proceeding was reserved for determination “on the papers”. On 20 December 2019 the trial judge made orders to the effect that the plaintiff pay the defendant’s costs of the claim on a standard basis, the defendant pay the plaintiff’s incremental costs of the counterclaim on a standard basis, and that there be no order as to the costs of the costs application (‘costs orders’). In his reasons, published that day,[2] the trial judge noted the various costs orders made along the way, but did not deal with the application in the CPA summons. Whether the costs orders made by the trial judge had regard to the issues agitated by the plaintiff in the CPA summons was a live issue in the application before me (‘threshold issue’).
[2][2019] VSC 853.

The plaintiff issued an application for leave to appeal against the costs orders. This application was heard and determined after judgment in this application was reserved. The Court of Appeal granted the application for leave to appeal, but dismissed the appeal. While strictly speaking, the issues in the CPA summons were distinct from the issues considered by the Court of Appeal in the application for leave to appeal the costs orders, given the thrust of some of the submissions made by the defendant at the hearing on 20 August 2020 concerning the threshold issue, I determined to postpone delivering my reasons on the current application until after the publication of reasons by the Court of Appeal, which were published on 10 February 2021. My review of the reasons of the Court of Appeal indicated that, in hindsight, it was probably not necessary to postpone my consideration of the current application for that reason, but in an abundance of caution, I did so.

The current application

The relevant background to the current application can be summarised as follows:

(a) on 12 May 2017, shortly after the close of pleadings, John Dixon J (‘managing judge’) made orders setting the proceeding down for trial on 30 April 2018, and that the parties file and serve their affidavits of documents by 23 June 2017. The plaintiff complied with this order, but the defendant sought an extension of time to complete discovery. After an exchange of correspondence between solicitors, and the issue of a summons by the plaintiff to compel the defendant to provide discovery, the defendant filed and served an affidavit of documents on 18 August 2017 (‘original discovery’);

(b) on 21 August 2017 the Court made orders by consent concerning the original discovery, including orders that the defendant pay the plaintiff’s costs of the summons referred to in (a) above;

(c) on 28 September 2017, the solicitors for the plaintiff wrote to the solicitors for the defendant asserting that the original discovery was deficient, and sought that the defendant provide supplementary discovery in accordance with twelve categories of documents. Then followed a further exchange of correspondence between the solicitors for the parties, including a letter from the solicitors for the plaintiff proposing that orders be made for the provision by the defendant of a supplementary affidavit of documents, and a timetable for the plaintiff to make any application for further discovery;

(d) the parties could not agree on the proposed orders, with the solicitors for the defendant stating on 9 November 2017 that “any expectation on your firm’s part that our client will be providing any Supplementary Affidavit in late November 2017 is misplaced”;

(e) on 10 November 2017 the parties appeared at a directions hearing before the managing judge, where, among other things, the managing judge set a date by which the plaintiff should make an application that the defendant provide further and better discovery;

(f) on 14 November 2017 the plaintiff filed a summons seeking that the defendant make discovery pursuant to r 29.08 and/or r 29.11 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) (‘Rules’) in accordance with eighteen categories of documents (‘discovery summons’);

(g) in the period leading up to the return date of the discovery summons before me on 6 December 2017, the solicitors for the plaintiff wrote to the solicitors for the defendant on two occasions proposing a timetable for the filing of the affidavits and written submissions, but received no response;

(h) on 4 December 2017 the solicitors for the defendant sent an email to the solicitors for the plaintiff (‘4 December email’), as follows:

[W]e have been carrying out an extensive review of our client’s discovery, entirely as a matter of caution in relation to your request. That process, having been undertaken entirely voluntarily and without any reason to believe that it was properly called/or, is now at an advanced stage ... ... We can, however, already at this stage, state that contrary to the assumptions behind your application you in fact have been provided with all the documents in categories which you assert to be incomplete.
We specifically requested that you wait until 8 December 2017 before filing your application on the express basis that we would not be able to respond effectively before that date. You nevertheless filed your application significantly earlier than you had originally suggested you would, and you sought to have this matter heard at a time that your client knew causes insurmountable difficulties for our client.
We will not be able to provide a more detailed explanation of our position by way of affidavit until Tuesday evening.
It is clear that some of your requests go beyond any entitlement you have to documents under rule 29 of the Supreme Court (General Civil Procedure) Rules 2015. For example, category 19 seeks all FIP newsletters from 2013 without any apparent basis in what appears to be a fishing expedition; other categories are stated in overly-wide terms that are likely to capture documents that are wider than those required to be discovered.
We can, however, already at this stage, state that contrary to the assumptions behind your application you in fact have been provided with all the documents in categories which you assert to be incomplete. For example, you already have all FIP financial accounts between January 2013 and December 2016 (category 18); you already have the agendas and documents to be considered at the FIP General Assemblies between January 2013 and December 2016 (category 17); you have the auditor’s report and the documents referring to the audit of the accounts presented at the General Assembly on 10 December 2015 (Category 16) and so on.
Nevertheless, we have no objection to stating that if we do find documents responsive to any of categories 1 - 18 in the Schedule to your Summons filed 14 November 2017 we will discover those documents by including them within a further affidavit of discovery regardless of whether there is an obligation to do so under rule 29 or not.
It would appear to us that your Summons therefore serves no utility, and that there is no purpose served arguing over whether all of the documents in the Schedule fall within a present obligation under rule 29 or not.
We note in passing that in supplying you previously with the Defendant’s Affidavit of Documents (itself consisting 89 pages in small print or 167 pages in larger print) we also provided you with copies of the documents contained therein amounting to 2,531 pages in 6 lever arch folders. We note further that your client’s questionable request for further discovery only emanates out of his ongoing investigation of that copious material.

(i) on the morning prior to the hearing, on 5 December 2017, Mr Bruce wrote to my chambers, stating, among other things, as follows:

We would ask however to correct a statement made by Mr Joseph which we do not believe accurately records what was stated before his Honour Justice John Dixon On 10 November 2017, though naturally the error will have been inadvertent and may have been a matter of impression. Mr Joseph advised in his email of 4.47 pm yesterday that the author indicated to the Court that the defendant intends to file and serve a supplementary affidavit of documents before the hearing on 6 December 2017 and that the plaintiff was yet to receive the documents.
My contemporaneous note from my attendance states that the author advised that he did not know “if and what” affidavit would be provided. This was stated in the context of explaining to the Court that we had not determined that any further discovery was required, but that we were conducting a review as a matter of caution. Had it have been the case that the defendant agreed to provide a further affidavit of documents and to do so prior to the hearing, the plaintiff presumably would not have proceeded with the orders sought.
We had always made clear to the plaintiff that we would not be able to complete the review (undertaken entirely as a matter of caution) prior to 8 December as there were instructions on some matters that we would not be able to obtain until 4 December (Australia time). Those instructions have now been obtained in Buenos Aires and conveyed to us in the early hours of this morning and we are preparing an affidavit now, if that is acceptable to her Honour. We Intend to file and serve it as soon as possible.
We do note however that in our most recent correspondence to the plaintiff of earlier today we advised the plaintiff that we had still not identified any document which had not been discovered which should have. While we stated that the voluntary review process (which was undertaken specifically to avoid any suggestion of complacency in the face of insistence by the plaintiff on grounds entirely unclear to us that there must be further documents) which has been undertaken at significant time and expense was not yet finalised, we did state that if there were any documents that answered the 18 categories that had not been provided we were happy to provide them regardless of whether there was a present duty to do so (subject of course to the usual exceptions in the case of privilege and subject to the document being in our client’s possession, control or custody). We have received no response to this offer, and we are unclear as to the purpose or utility of the orders sought.

(j) notwithstanding the comments in the email above, there was no indication from either party that consent orders would be forthcoming, and the discovery summons remained listed for hearing on 6 December 2017;

(k) on 5 and 6 December 2017, the defendant’s solicitor, Mr Bruce, made two affidavits. In the first affidavit (‘5 December affidavit’), Mr Bruce deposed, among other things, that the defendant had instructed him that all the documents falling within the first six categories of documents sought by the plaintiff (’FIP documents’) had been discovered;

(l) in paragraph 10 of the 5 December affidavit Mr Bruce deposed as to the instructions he had received from the defendant with respect to the eighteen categories of documents referred to in the discovery summons. In relation to the FIP documents, and categories 9, 10, 11, 13 and 15 - 18 inclusive, Mr Bruce deposed that he was instructed that all documents required to have been discovered had been discovered. In paragraph 11 of the 5 December affidavit, Mr Bruce deposed as follows:

While the Defendant is prepared to provide further documentation as set out above, he believes that, after having already provided the Plaintiff with 2,531 pages of discoverable documents, the Plaintiff’s further request for allegedly better discovery is little more than a fishing expedition and unnecessary in respect of the plaintiff’s claim for defamation against him.

(m) in paragraph 8 of the second affidavit (‘6 December affidavit’), Mr Bruce deposed as follows:

Neither the Executive Committee nor the Council of Administration create (except in unusual circumstances) written or signed motions, resolution or other determinations. The Executive Committee meets and conducts its work orally; motions or resolutions are proposed and seconded orally and adopted orally. The Council of Administration meets the very next day after the Executive Committee in December of each year. There are no written reports that are provided (in the ordinary course of events) from the Executive Committee to the Council of Administration. There is no opportunity or time to provide such a report. Apart from one person employed to assist with social media, the Federation of International Polo has two employees: a CEO and the CEO’s assistant. It is an extremely demanding task, particularly during all of November and early December in the lead-up to the General Assembly. The plaintiff has timed its current requests and applications at a time that coincides with that period, despite our many requests that they await the results of our voluntary review of documents and not file an application at this time because of the difficulty in responding to it prior to 8 December 2017. Those time constraints are a further reason why there is no practical opportunity to create a written report between the meeting of the Executive Committee and the meeting of the Council of Administration the next day, immediately before the General Assembly that follows a day or so afterwards.

(n) on 6 December 2017, the parties appeared before me for the hearing of the discovery summons. The transcript of the hearing shows that the relevance or otherwise of the eighteen categories of documents, or any of them, was not the subject of any debate, and the 6 December orders required the defendant to discover any documents in these categories by 20 December 2017.

What transpired at the hearing on 6 December 2017 is summarised below:

(a) senior counsel for the plaintiff summarised the history of the interlocutory steps in the proceeding to date, including the correspondence between the solicitors for the parties regarding the plaintiff’s criticisms of the original discovery;

(b) senior counsel for the plaintiff then summarised what had occurred at the directions hearing before the managing judge on 10 November 2017. He said that at this hearing, the defendant’s solicitor had told the managing judge that the defendant would provide a supplementary affidavit of documents.[3] The defendant submitted to the managing judge that the return date for the plaintiff’s foreshadowed discovery summons should be in the New Year, so that the defendant could provide a supplementary affidavit of documents before the return date of the discovery summons, but the managing judge did not accede to that request;
[3]This characterisation of what occurred at this hearing is disputed by the defendant (see paragraph 12(i) above).

(c) senior counsel for the plaintiff noted that upon the allocation of a return date of 6 December 2017, on 14 November 2017 the solicitors for the plaintiff wrote to the solicitors for the defendant regarding the timetable for the hearing of the discovery summons, but did not receive a substantive response until the 4 December email;

(d) at this point counsel for the defendant interjected, saying that the defendant had not located any documents that ought to have been discovered which had not been discovered. However, the defendant had commenced an extensive discovery review process. Counsel for the defendant agreed with my observation that the defendant’s position was to the effect that the defendant did not necessarily agree that the categories of documents sought by the plaintiff in the discovery summons were relevant to the issues in the proceeding, but the defendant agreed to look for those documents anyway in order to move the matter forward;

(e) senior counsel for the plaintiff observed that the discovery sought from the defendant was extensive, because of the wide-ranging nature of the allegations made by the defendant in the defence and counterclaim. Further, if there were no documents in existence which were responsive to the categories of documents referred to in the discovery summons, the defendant or a responsible officer of FIP should explain why. He noted that the proceeding was set down for trial for fifteen to twenty days commencing in April 2018, and the plaintiff was concerned to avoid documents being discovered by the defendant shortly prior to the trial date;

(f) counsel for the defendant submitted that the review process was quite advanced, but the defendant did not have any basis for believing that the original discovery was inadequate;

(g) in response to a suggestion by me that it was likely that the review process would disgorge some documents, and that if there were not further documents, the defendant and/or a responsible officer of FIP should explain why, counsel for the defendant said that there was a difficulty with that proposal, because the plaintiff was contending that if certain documents did not exist, then that would be evidence in support of the plaintiff’s claims that FIP did not comply with its own by-laws;

(h) there followed further discussion between me and counsel for the defendant regarding the timing of a supplementary affidavit of documents and the use to which any supplementary affidavit of documents could be put, with counsel for the defendant maintaining his concern that the plaintiff could deploy the affidavit in support of his substantive allegations at trial;

(i) in response, senior counsel for the plaintiff observed that it is commonplace for witnesses to be cross‑examined on their affidavit of documents if there is a suggestion that they had not been candid with the Court or the other party;

(j) counsel for the defendant then expressed concern that there would generally only be orders made for the filing of a further affidavit of documents in circumstances where the Court had found that there had been a failure to comply with previous discovery orders, which was not the case here. He also complained that the plaintiff had failed to engage with the defendant’s request that the plaintiff identify with some specificity the documents which were said by the plaintiff to be missing from the original discovery; and

(k) then followed a further discussion regarding the timing and form of any supplementary affidavit of documents, following which I made the 6 December orders, as follows:

1.By 4.00pm on 20 December 2017 the defendant or a responsible officer of the Federation of International Polo (“FIP”) file and serve a supplementary affidavit of documents which:
(a)discovers any documents which fall within the terms of the plaintiff’s summons filed 14 November 2017 (“14 November summons”) which have not already been discovered;
(b)deposes, in the case where no .documents which are responsive to any of the categories of documents exist (or they are no longer in the possession of the defendant or the FIP), as to the reasons why they do not exist, or are no longer in the possession of the defendant or the FIP, by reference to the categories of documents in the 14 November summons; and
(c)in the case of where discoverable documents are subject to a claim for legal professional privilege pursuant to s 118 of the Evidence Act 2008 (Vic), enumerate the documents concerned and provide a basis for the making of the claim for privilege.

2.For the avoidance of doubt, paragraph 1(c) above applies to all discoverable documents for which a claim under s 118 is made, not just documents which fall within the terms of the 14 November summons, and does not include documents for which a claim is made under s 119 of the Evidence Act 2008 (Vic).
3.There be liberty to apply with respect to the working out of these orders.
4.The defendants pay the plaintiff’s costs of the 14 November summons and the costs of the hearing on 10 November 2017.

I ordered that the defendant pay the plaintiff’s costs of the discovery summons, and the hearing before the managing judge on 10 November 2017, on the basis that:

(a) the defendant’s lack of progress in making discovery, or in addressing the issues raised by the plaintiff necessitated the making of the application;

(b) no affidavit of documents was filed before the hearing on 6 December 2017, notwithstanding the statement by the defendant at the directions hearing on 10 November 2017 that a supplementary affidavit of documents would be filed before the return date of the discovery summons; and

(c) no substantive response was provided by the defendant to the issues raised by the plaintiff in September and October 2017 with respect to the deficiencies in the original discovery until 4 December 2017.

I made the following observations in “Other Matters”:

A.The purpose of making the order in paragraph 1(b) of the orders is to bring some finality to the discovery process.
B.Counsel for the defendant has expressed some concerns as to the use of which the supplementary affidavit of documents could be put. I note that the affidavit will be subject to the Harman undertaking, and any concerns as to how the affidavit is to be deployed at trial can be raised with the trial judge.

I do not propose to reproduce in full the eighteen categories of documents required to be discovered by the defendant pursuant to the discovery summons. The parties’ submissions in the current application focussed in particular upon the FIP documents, as follows:

1.All documents comprising, recording or referring to any agenda, minutes, notes of meetings, resolutions or motions (including drafts of any such documents) of the Executive Council of the FIP (EC) dated between January 2013 and December 2016 which relate to any of the accusations made by the plaintiff concerning the FIP as identified in the Defence and Counterclaim dated 23 March 2017 (Defence) or the Reply dated 5 May 2017 (Reply).
2.All documents comprising, recording or referring to any agenda, minutes, notes of meetings, resolutions or motions (including drafts of any such documents) of the Council of Administration of the FIP (CoA) dated between January 2013 and December 2016 which relate to any of the accusations made by the plaintiff concerning the FIP as identified in the Defence or the Reply.
3.All documents comprising, recording or referring to any minutes, notes, records or reports (including drafts of any such documents) of any investigations or report carried out by the EC in relation to any of the of the accusations made by the plaintiff concerning the FIP as identified in the Defence or the Reply.
4.All documents comprising, recording or referring to any minutes, notes, records or reports (including drafts of any such documents) of any investigations or report carried out by the CoA in relation to any of the of the accusations made by the plaintiff concerning the FIP as identified in the Defence or the Reply.
5.All documents comprising, recording or referring to any communications between representatives of the EC and representatives of the CoA (whether between themselves or with one another) dated between January 2013 and December 2016 which relate to any of the accusations made by the plaintiff concerning the FIP as identified in the Defence or the Reply.
6.All documents comprising, recording or referring to any report or draft report or proposed report by the Chief Executive Officer of the FIP to the EC or to the CoA dated between January 2013 and December 2016 in relation to any of the of the accusations made by the plaintiff concerning the FIP as identified in the Defence or the Reply.

It is not necessary for present purposes to undertake a detailed analysis of the relevance of the categories of documents sought by the discovery summons, save to note that while the categories are broad ranging, they are drafted in such a way as to be referable to specific allegations by the parties in their pleadings (in particular, the defence and counterclaim and the reply), or to specific meetings, events, documents or time periods. Accordingly, while I do not need to decide the matter here, it seems unlikely that the defendant would have been able to successfully oppose orders with respect to all of the categories on the grounds of relevance and/or oppression.

Following the hearing on 6 December 2017, the following transpired:

(a) on 11 December 2017, the solicitors for the plaintiff wrote to the solicitors for the defendant querying Mr Bruce’s knowledge of the matters to which Mr Bruce deposed to in the 6 December affidavit, and observed that Mr Bruce’s statement in the 6 December affidavit to the effect that neither the EC nor the Council of Administration of FIP (‘C of A’) create written motions, resolutions or determinations (save in exceptional circumstances) was contrary to the requirements of the FIP by-laws, and the contents of the defendant’s emails. No response was ever provided by the solicitors for the defendant to this letter;

(b) on 22 December 2017, the defendant filed and served its supplementary affidavit of documents, which discovered 2,207 documents in addition to the 786 documents in the original discovery;

(c) also on 22 December 2017, the solicitors for the plaintiff wrote to the solicitors for the defendant commenting upon the large number of documents included in the supplementary affidavit of documents, and stating that the contents of the supplementary affidavit of documents appeared to be inconsistent with statements made by Mr Bruce in the 6 December affidavit, given that the supplementary affidavit of documents included documents within each of the eighteen categories of documents sought by the discovery summons; and

(d) the defendant produced the documents discovered in his supplementary affidavit of documents on 29 December 2017 (‘supplementary discovery’). In a lengthy letter accompanying the supplementary discovery (‘29 December letter’), Mr Bruce stated, among other things, as follows:

We note that in your correspondences you assert that we repeatedly indicated that we did not expect our client to make any further discovery. That is inaccurate. We had always indicated that we were conducting a review of discovery and that any expectation on your part that further documents would be discovered was premature.
We do not understand your statement that no explanation has been offered as to why such a large number of documents are being discovered at this very late stage. The reason is simple: Most of the documents which your client sought by way of his 14 November 2017 Summons did not fall within rule 29.01.1 and were not required to be discovered.
(emphasis in original)

(e) Mr Bruce went on to say as follows:

The only reason our client was required to make discovery of the documents ordered to be discovered on 6 December 2017 was because our client consented to the order. Her Honour was, as you will recall, uninterested in hearing argument as to whether the orders should or should not be made in light of our client’s consent.
Two days before the hearing of your client’s 14 November 2017 Summons, we sent you a written offer agreeing to discover those documents. That offer was made solely with the intention of avoiding a contested hearing. You chose to ignore our offer and failed altogether to respond to it. You therefore caused us not only to unnecessarily appear in Court but, also, to make discovery of a wide tranche of documents to which your client otherwise had no entitlement and which your client sought by way of a fishing expedition.
Your client appears to have no proper understanding of the actual scope of discovery required under rule 29.01.1. Under rule 29.01.1, unless the Court orders otherwise, discovery is limited to those documents, of which a party becomes aware following a reasonable search: upon which the party relies; which adversely affect either party's case; or which support the other party’s case.
(emphasis in original)

(f) Mr Bruce then referred to the commentary of the Law Reform Commission of Victoria in 2008 in support of its recommendation that the entitlement to general discovery be revoked in support of his contention that the scope of r 29.01.01 was quite narrow, and went on to state as follows:

Contrary to the narrow discovery test in rule 29.01.1, your 14 November 2017 Summons sought discovery of wide tranches of documents of no apparent or direct relevance, in what can only be described as a trawling expedition. You requested all newsletters from 2013, for instance - why? You sought these documents just in case they might be relevant. That is the very definition of fishing.
You requested all bank statements over a 4 year period - why? The issues between the parties in relation to FIP’s NAB bank account are extremely narrow. In fact, it is not apparent that there is any genuine factual dispute. Our client alleges that your client controlled FIP’s NAB bank account and that he refused to access or operate the account; your client admits these allegations. Your client’s response is not entirely coherent, but it seems to consist of an assertion that it was FIP’s fault in the first place for entrusting the account to your client and that FIP could have taken other steps. Whatever these steps supposedly are, they are not to be found by a perusal of the bank accounts;

(g) Mr Bruce then commented upon specific categories requested by the plaintiff in the discovery summons, and concluded as follows:

That you now face a large tranche of documents to examine is a problem altogether of your own creation. The majority of those documents are of no relevance to the proceedings whatsoever, and even where marginally relevant, do not meet the test for discovery under rule 29.01.1.
Accordingly, the first occasion upon which our client came under a prospective duty to discover the documents referred to in your client’s 14 November 2017 Summons was 6 December 2017.
If your client was of the view that he ought to have access to every conceivable document of any potential relevance, then he ought to have applied for general discovery at an earlier stage of the proceedings. There was no proper basis upon which such an order could have been made; you have those documents now due to our consent and our consent alone;

(h) on 31 December 2017 the plaintiff’s solicitor wrote to the defendant’s solicitor, stating, in summary, as follows:

(i) the plaintiff’s solicitors had commenced reviewing the supplementary discovery;

(ii) it was clear from this preliminary review that the defendant appeared to have discovered a number of documents which Mr Bruce had deposed in the 6 December affidavit did not exist. The email noted that Mr Bruce had provided no explanation for this apparent inaccuracy in his affidavit in this regard, despite the request in the letter from the plaintiff’s solicitors of 11 December 2017;

(iii) further, Mr Bruce had not responded to their letter of 11 December 2017 at all, so that as matters stood, the Court appears to have been misled by the 6 December affidavit;

(iv) it was too late for the defendant to contest the relevance of the categories of documents referred to in the discovery summons; and

(v) the original discovery was plainly inadequate, which was the basis for the Court’s orders requiring the defendant to make further discovery. The Court also ordered that the defendant pay the plaintiff’s costs for not providing that discovery earlier. To suggest in these circumstances that the only reason the Court made the order was because the defendant consented to it was plainly wrong;

(i) no substantive response was ever provided to this letter; and

(j) on 16 February 2018, the plaintiff’s solicitor wrote a further long and detailed letter to the defendant’s solicitor, contending that the 6 December affidavit was inaccurate and misleading, and complaining about the defendant’s approach to discovery. This letter concluded as follows:

Our client has no wish to trouble the Court with a further application in respect of your client’s approach to his discovery obligations in this proceeding. However, in light of the matters set out above, and particularly the misleading statement made by your client, you and Dr Baron Levi in relation to your client’s discovery, including statements made in affidavits filed with the Court and in submissions made to the Court, our client considers that an explanation, and immediate corrective action, is in order.
We are instructed to request that you provide us, in writing, within the next seven days, an explanation for the matters set out above and a proposal in relation to corrective action.

No response was provided to this letter. On 26 February 2018 the plaintiff filed the CPA summons. As previously noted, on 2 March 2018 the Court ordered that the hearing of the application in the CPA summons be adjourned until after the substantive proceeding had been finalised.

On 20 January 2020, a few weeks after the trial judge made the costs orders, the solicitors for the plaintiff wrote to the solicitors for the defendant about the application in the CPA summons. The plaintiff rejected the defendant’s proposal that the application be held in abeyance pending the hearing and determination of the plaintiff’s application for leave to appeal with respect to the costs orders, and ultimately, after some further correspondence between the parties and the Court, the application in the CPA summons was listed for hearing before me on 20 August 2020. In the meantime, on 1 July 2020, I made orders by consent staying the costs orders pending the hearing and determination of the application for leave to appeal.

The evidence

The plaintiff relied upon the following affidavits in support of his application in the CPA summons:

(a) an affidavit of Jonathan Guy Joseph, the solicitor for the plaintiff, made on 28 February 2018; and

(b) an affidavit of Jonathan Chung Wa Leung, another solicitor for the plaintiff, made on 22 May 2020.

The affidavits relied upon by the plaintiff largely exhibited correspondence between the parties regarding discovery in late 2017 to early 2018, and regarding this application in 2020.

The defendant relied upon an affidavit of Raymond Jonathon Abrahams, a solicitor with Batten Sacks, based upon information and belief and the instructions of the defendant, which was filed on 12 June 2020. This affidavit annexed a large number of documents, including, among other things:

(a) correspondence between the solicitors for the parties leading up to and following the issue of the discovery summons;

(b) correspondence between the solicitors for the parties after the filing and service of the defendant’s supplementary affidavit of documents;

(c) correspondence between the solicitors for the parties in 2018 regarding two of the documents in the supplementary discovery, which were said by the plaintiff to be critical documents within the meaning of s 26 of the CPA (‘Polo Development Fund emails’); and

(d) a copy of the transcript of the hearing before me on 6 December 2017.

Mr Abrahams also deposed as to his instructions regarding the Polo Development Fund emails, and commented upon the table of 107 documents (‘table’) provided by the plaintiff as particulars to the allegations in the CPA summons.

In relation to the first of the Polo Development Fund emails (‘exhibit P65’) Mr Abrahams deposed as follows:

I am instructed as follows in relation to discovery document DD 2567:
a.the first time, during the conduct of the proceedings, that discovery document DD 2567 came to the awareness of the defendant and legal representatives for the defendant was in the later part of December 2017, as part of the discovery review process;
b.during that process, extensive searches took place for documents including those responsive to all categories proposed by the plaintiff and ordered by the Court to be discovered on 6 December 2017;
c.that search included (among other things) the use of extensive key word searches of various custodian’s electronic documents. Those searches (as well as other searches) returned many thousands of documents, including documents previously discovered or disclosed in the proceedings. Those documents were subjected to further processes to eliminate pure duplicates of documents and were reviewed to determine whether they were documents that should be discovered;
d.discovery document DD 2567 (which was tendered as Exhibit P65) was a document which was located through the extensive searches conducted during the discovery review process described above. It was one of various emails located through that same process and discovered as part of supplementary discovery once it had been located and reviewed along with many other documents;
e.when the document was referred to by the plaintiff in sub-paragraph 7(v) of the plaintiff’s amended reply and defence to counterclaim filed on 21 March 2018, Batten Sacks wrote to Strongman & Crouch to ask that a copy (inter alia) of that document be provided to Batten Sacks as it was not a document with which Batten Sacks was clearly familiar;
f.on 22 March 2018 at 9.54 a.m. Mr Joseph of Strongman & Crouch emailed Mr Bruce of Batten Sacks a copy of DD2567 [Annexed hereto] stating that:
“[PD 2567] has not previously been referred to in the pleadings. A copy is attached for your reference. This document was discovered by your client.“[4]

[4]At the hearing on 20 August 2020, senior counsel objected to this evidence as being inadmissible, as it did not comply with s 75 of the Evidence Act 2009 (Vic) which provides an exception to the exclusion of hearsay evidence in interlocutory applications, provided that the party adducing the evidence also adduces evidence of the source of the evidence.

In relation to the second of the Polo Development Fund emails (‘exhibit P114’) Mr Abrahams deposed as follows:

I am also instructed that the first time, during the conduct of the proceedings, that discovery document DD 2670 came to the awareness of the defendant and legal representatives for the defendant was in the later part of December 2017, as part of the discovery review process.

As for the table, Mr Abrahams deposed that while he had not carried out an exhaustive review of the supplementary discovery, he had been instructed that the documents in the table included numerous drafts and translations of documents already discovered by the defendant in the original discovery. Mr Abrahams identified 49 documents said to fall within this description, but deposed that he was instructed that there were others of that nature referred to in the table. The supplementary discovery also included documents brought into existence as late as 2017, well beyond the time period relevant to the issues in the proceeding.

In addition to the affidavits relied upon by the parties for the purposes of the CPA summons, also included in the court book were the 5 December affidavit and the 6 December affidavit, the submissions filed by the plaintiff prior to the hearing on 6 December 2017, and further and better particulars of the CPA summons filed by the plaintiff on 3 March 2020, which referred to the correspondence between the parties in December 2017 and February 2018 relied upon by the plaintiff in support of his application in the CPA summons. Subsequently, the parties forwarded the submissions provided by them to the trial judge concerning the costs application as a result of the defendant’s submissions concerning the threshold issue.

The issues in the application

In this application, the plaintiff seeks declarations that the defendant, and his solicitor, Mr Bruce, have contravened the following provisions of the CPA:

(a) the obligation in s 20 of the CPA to co‑operate with the plaintiff and the Court;

(b) the obligation in s 21 of the CPA to not engage in misleading conduct, or conduct which was likely to mislead or deceive; and

(c) the obligation in s 26 of the CPA to disclose all critical documents of which the defendant was aware at the earliest reasonable opportunity after the defendant became aware of their existence, with critical documents being those documents which a party could reasonably be expected to have relied upon as forming the basis of a party’s case, and/or documents that the party concerned knows will adversely affect their case.

As well as the declarations referred to above, the plaintiff seeks an order under s 29(1) of the CPA that the defendant and Mr Bruce pay the plaintiff’s costs of the discovery summons on a full indemnity basis, in place of the order I made on 6 December 2017 that those costs be payable on a standard basis.

Section 29(1)(a) of the CPA provides as follows:

Court may make certain orders
(1)If a court is satisfied that, on the balance of probabilities, a person has contravened any overarching obligation, the court may make any order it considers appropriate in the interests of justice including, but not limited to-
(a)an order that the person pay some or all of the legal costs or other costs or expenses of any person arising from the contravention of the overarching obligation.

Further, while the CPA summons does not expressly refer to s 28 of the CPA, s 28 provides as follows:

Court may take contravention of overarching obligations into account
(1)In exercising any power in relation to a civil proceeding, a court may take into account any contravention of the overarching obligations.
(2)Without limiting subsection (1), in exercising its discretion as to costs, a court may take into account any contravention of the overarching obligations.

The defendant submitted that the issues raised by the plaintiff in the CPA summons had already been ventilated before and determined by the trial judge when making the costs orders. Under cover of that objection, the defendant denied that either he or his solicitor had been engaged in misleading and deceptive conduct, or had been uncooperative with the plaintiff or the Court.

Prior to turning to the submissions of the parties, I should note that the conduct of this application has been characterised by the same level of doggedness and acrimony that has underpinned the dealings between the parties going on near a decade now, including the years prior to the issue of the proceeding, the interlocutory stages of this proceeding, the trial, the application for leave to appeal, and during the conduct of the hearing of the CPA summons. Just by way of example, in correspondence leading up to the hearing on 20 August 2020, the solicitors for the plaintiff suggested that the defendant and his solicitors could be liable for contempt of court by failing to abide by an order confining the length of the parties’ submissions, which is hardly a hanging offence. Another unfortunate example of such conduct is the repeated references by the defendant’s counsel in his oral and written submissions to the plaintiff’s submissions being “false” or “misleading”. One legal practitioner can genuinely disagree, even strongly disagree, with another’s submissions without the need to accuse them of dishonesty, or other misconduct. The lawyers for both parties should reflect upon whether it is necessary or appropriate to use such discourteous and inflammatory language in their communications with others.

Further, the hearing of this application consumed nearly one full sitting day, as well as the time required to peruse a three-hundred-plus page court book, further written submissions filed after the hearing, and a further two hundred pages of documents exhibited to Mr Abrahams’ affidavit. The range and nature of the issues in this application and the extensive and detailed submissions provided by the parties has necessitated the preparation of detailed reasons.

One might consider that the resources (both private and public) which have been devoted to this application were disproportionate to the stakes involved. After all, if the plaintiff was to be successful in this application, all that he would derive, apart from some sense of moral satisfaction, would be the difference between the costs of the discovery summons on a standard basis and those costs on a full indemnity basis, which, while not negligible, are unlikely to be in excess of $50,000, and probably far less. Accordingly, the potential return to the plaintiff of pursuing this application is quite modest, and extremely modest in the context of the costs of the proceeding as a whole. One can question whether the approach of the parties has been proportionate to the nature and financial consequences of the current dispute.

Submissions

The plaintiff submitted that the defendant and Mr Bruce made false and misleading statements of a serious nature in opposition to the discovery summons. They failed to offer any explanation for those statements. They adopted a position with respect to discovery which was not open for them to responsibly take. They failed to disclose critical documents until required to do so by the 6 December orders.

The plaintiff observed that the obligation to co-operate in s 20 of the CPA is a broad obligation, the contravention of which can be taken into account on the question of costs. Further, the authorities provide that s 21 prohibits those who are subject to the overarching obligations from engaging in misleading and deceptive conduct, even unintentionally, with the content of the obligation being informed by the jurisprudence with respect to s 18 of the Australian Consumer Law.

Further, the plaintiff submitted that s 26 of the CPA required the defendant to disclose all critical documents of which he was aware at the earliest possible opportunity, being documents which “a party would reasonably be expected to have relied upon as forming the basis of the party’s claim when commencing the case, as well as documents that the party knows will adversely affect the case”. He submitted that the Polo Development Fund emails were clearly critical documents.

The plaintiff referred to the observations made by Vickery J in Hodgson v Amcor(No 10)[5] regarding the critical role of discovery in civil litigation, and in particular his Honour’s observation concerning the interaction between the CPA and the parties’ discovery obligations, which were said to include:

... an obligation, now underlined in statutory form, to undertake the processes of discovery in a thorough and ethical manner in compliance with the well-established standards.[6]

[5][2012] VSC 294.

[6]Ibid [69].

The plaintiff referred to the leading decision of the Court of Appeal in Yara Australia Pty Ltd v Oswal,[7] where the Court concluded that:

The [CPA] prescribes that parties to a civil proceeding are under a strict, positive duty to ensure that they comply with each of the overarching obligations, and the court is obliged to explore these duties. The statutory sanctions provide a valuable tool for improving case management, reducing waste and delay and enhancing the accessibility and proportionality of civil litigation. Judicial officers must actively hold the parties to account.[8]

[7](2013) 41 VR 302 (‘Yara’).

[8]Ibid [26].

The plaintiff outlined the events leading up to the hearing of the discovery summons on 6 December 2017, focussing in particular on the plaintiff’s request that the defendant provide further and better discovery of the FIP documents.

The plaintiff submitted that the statements of Mr Bruce to the effect that the FIP documents had all been discovered were false, or at the very least, misleading, referring to the following statement of Mr Bruce in the 4 December email:
We have been carrying out an extensive review of our client’s discovery, entirely as a matter of caution in relation to your request. That process having been undertaken entirely voluntarily and without any reason to believe that it was properly called for, is now at an advanced stage ... We can, however, already at this stage, state that contrary to the assumptions behind your application you in fact have been provided with all the documents in categories which you assert to be incomplete.
(emphasis added)
The plaintiff then referred to paragraph 10 of the 5 December affidavit and paragraph 8 of the 6 December affidavit (see paragraphs 12(l) and (m) of these reasons), and submitted as follows:

At the hearing on 6 December 2017, the defendant relied upon [the 5 December affidavit and the 6 December affidavit] to oppose the making of any order for further discovery. Although the defendant did not dispute the relevance of any of the categories of discovery, he maintained the position that it [sic] had already provided adequate discovery.

The plaintiff referred to the 6 December orders and the supplementary discovery, noted that the supplementary discovery included 2,207 documents and comprised in excess of 10,000 pages, and went on to submit as follows:

Contrary to the statements of Mr Bruce in the 4 December Email and the 6 December Bruce Affidavit, and contrary to the defendant’s instructions recorded in the 5 December Bruce Affidavit, the further discovery included documents within each of the categories the subject of the Discovery Summons that had not previously been discovered. Critically, this included many documents falling within categories 1-6 which Mr Bruce and the defendant had said did not exist. The plaintiff’s solicitors’ letter dated 16 February 2018 attached a table identifying 107 documents from the defendant’s supplementary discovery which comprised minutes, motions, resolutions, and reports of the EC and CoA. As the letter noted, this confirmed that Mr Bruce’s statements in his 4 December Email and in his 5 and 6 December affidavits were plainly wrong and had the potential to mislead the Court to a significant extent.

The plaintiff observed that, despite numerous requests, Mr Bruce has failed to explain to the plaintiff and the Court how the inaccuracies in his affidavits and correspondence arose. The plaintiff submitted as follows:

... These failures plainly amount to a contravention of the overarching obligation to co-operate with the plaintiff and the Court in connection with the conduct of the proceeding (CPA, s 20). It is also clear from the correspondence referred to in the Chronology that the defendant and Mr Bruce contravened this obligation in relation to their overall conduct in the discovery dispute. Further confirmation of this contravention is recorded in ‘Other matters’ in the orders for further discovery made on 6 December 2017.

The plaintiff also asserted that Mr Bruce had engaged in misleading and deceptive conduct by reason of statements he made in the 29 December letter. Two statements in particular attracted the ire of the plaintiff, the first being the statement that:

The only reason our client was required to make discovery of the documents ordered to be discovered on 6 December 2017 was because our client consented to the order. Her Honour was, as you will recall, uninterested in hearing argument as to whether the orders should or should not be made in light of our client’s consent.

The other statement in the 29 December letter said by the plaintiff to be false and misleading was that:

Most of the documents which your client sought by way of [the discovery summons] did not fall within rule 29.01.1 and were not documents required to be discovered.

The plaintiff submitted as follows:

As to the first statement, this was plainly false. The defendant opposed the provision of any further discovery every step of the way. From the outset the defendant opposed any order that it provide a supplementary affidavit of documents. The defendant then served two affidavits in opposition to the further discovery sought, insisting that all documents in the categories sought had already been discovered. The defendant was also represented by counsel at the hearing on 6 December 2017 who contested the making of any order for further discovery. In light of these matters, the statement that the only reason the defendant was required to make discovery of the documents ordered to be discovered on 6 December 2017 was because he consented to the order is simply false. Apart from anything else, it is contradicted by the plain terms of the orders made on 6 December 2017.
As to the second statement, the direct relevance of the documents falling within the categories of further discovery was addressed by the plaintiff in detail in correspondence and in his submissions served for the 6 December 2017 hearing. These matters were never challenged by the defendant at all.
It follows that Mr Bruce’s conduct in making the impugned statements in the 29 December 2017 letter was misleading or deceptive, or at least likely to mislead or deceive, in breach of s 21 of the CPA. It was also conduct in contravention of the overarching obligation to co-operate with the plaintiff and the Court in connection with the conduct of the proceeding (CPA, s 20).

Turning now to the defendant’s alleged failure to disclose critical documents within the meaning of s 26 of the CPA, being the Polo Development Fund emails, the plaintiff submitted that the defendant should have reasonably considered that the Polo Development Fund emails were critical to the resolution of the dispute. The plaintiff submitted that, on any view, the Polo Development Fund emails, and in particular exhibit P65, were critical documents, as the existence of the Polo Development Fund was a central issue in the proceeding, given the allegations in the defence.

The plaintiff’s submissions also included an annexure which included the plaintiff’s original submissions with respect to the relevance of the FIP documents, and why the plaintiff considered that the FIP documents would be in the possession of the defendant. It is not necessary for present purposes to traverse those submissions in detail, save to say that from a cursory review of those submissions, the FIP documents do appear to have been relevant to the issues in the proceeding.

In conclusion, the plaintiff submitted as follows:

The conduct of Mr Bruce and the defendant in relation to the further discovery application involved clear contraventions of the CPA. The making of false or misleading statements in relation to the discovery of documents is plainly a serious matter. It is particularly serious when the statements are made in affidavits relied upon in contested hearings, and in circumstances where the statements are to the effect that the documents sought do not exist, which is proven to be false when those very documents are subsequently produced. In addition, Mr Bruce’s conduct following production, in wholly ignoring the plaintiff’s request that the inaccuracies be addressed with the Court, makes his conduct all the more objectionable.
Further, the failure to disclose what were clearly critical documents until some 18 months after the proceeding was commenced was a clear breach of s 26 of the CPA. The breach is aggravated by the fact that, not only were those documents omitted. from the initial discovery (itself two months late), but the defendant resisted orders for further discovery which included those documents, and only produced them pursuant to Court order.
Had Mr Bruce and the defendant complied with discovery obligations and their overarching obligations in the CPA, the substantial costs incurred by the plaintiff in pursuing his discovery requests would have been avoided. In these circumstances, it is submitted that the Court ought to make the declarations sought in the Summons, and order that the costs and disbursements of the plaintiff’s Discovery Summons and of the hearing on 10 November 2017 be paid on a full indemnity basis, enforceable and payable immediately.

The defendant commenced its written outline of submissions filed on 12 June 2020 with a summary of the critical findings made by the trial judge regarding the conduct and motivations of the plaintiff in its dealings with the defendant and FIP which resulted in the issue of this proceeding, and submitted that those criticisms should extend to the lawyers representing the plaintiff in this proceeding. The defendant submitted that the application in the CPA summons should be considered in the context of the history of the proceeding as a whole. In particular, the trial judge had held that the plaintiff had commenced the proceeding in order to wage war on FIP. The necessary corollary of that finding is that the proceeding was an abuse of process, because it had not been brought for a bona fide purpose.

The defendant submitted that the application should be dismissed because, among other things, the plaintiff was seeking to re-litigate the issues not only already determined by me in the 6 December orders, but were also issues which were ventilated by the plaintiff in his submissions to the trial judge on the question of costs.

The defendant noted that the trial judge did not accede to the plaintiff’s submission to the effect that the defendant’s conduct of the interlocutory steps in the proceeding justified an award of costs in favour of the plaintiff, and in his reasons, the trial judge stated that he had considered all of the matters raised in the parties’ submissions. These issues were also the subject of the plaintiff’s application for leave to appeal.

The defendant submitted that the plaintiff’s submissions in this application contained a number of false and misleading statements, and observed that the allegations against the defendant and Mr Bruce were very serious. Neither Mr Bruce or the defendant had been subject of any complaint prior to the issue of the CPA summons.

The defendant submitted that the plaintiff’s allegation that the statements of Mr Bruce were made in opposition to the discovery summons was demonstrably false. By 4 December 2017, the defendant had changed his position with respect to the plaintiff’s request for further discovery. In the 4 December email, Mr Bruce stated that:

... if we do find documents responsive to any of the categories 1 to 18 in the schedule to your summons we will discover those documents by including them within a further affidavit of discovery, regardless of whether there is an obligation to do so under Rule 29 or not.

The defendant submitted that his intention to provide further discovery was confirmed in the 5 December affidavit, the 6 December affidavit, and during the course of the hearing on 6 December 2017. The plaintiff would have been aware of the extent of the documents which were subject to the discovery review, that they were all outside Australia, and that they were in the possession of many custodians. The discovery process was time-consuming and complex, especially given the breadth of the categories in the discovery summons, but the defendant did not want to fight about discovery.

As for the plaintiff’s allegation that paragraph 8 of the 6 December affidavit was false and misleading, the defendant submitted that the allegation against Mr Bruce is misconceived, on the basis that:

(a) the plaintiff provided no basis for the assertion that Mr Bruce had personal knowledge of the matters set out in the 6 December affidavit. Mr Bruce affirmed that he deposed to the matters in the 6 December affidavit on the basis of information and belief, and referred to “being instructed” as to various matters;

(b) the phrase “knowledge and belief” ought not be equated with personal knowledge: rather, it means a belief that is not contradicted by knowledge;

(c) further, paragraph 8 of the 6 December affidavit did not state that specific documents did not exist: it only referred to classes of documents;

(d) the plaintiff has produced no evidence or particulars of what specific documents said to support his contention that Mr Bruce’s statements were misleading or deceptive, how the statements in relation to those documents are said to be false and misleading, and how the table supports the plaintiff’s contention that the 6 December affidavit was false or misleading;

(e) almost all of the 107 documents in the table are various drafts, versions or forms of minutes of meetings, which were not the subject of paragraph 8 of the 6 December affidavit, which referred only to “written or signed motions, resolutions or other determinations” of FIP; and

(f) the table does not include any report sent between the meeting of the EC and the C of A the next day; and

(g) the plaintiff has not articulated how he says said he was misled. Further, the statements in paragraph 8 of the 6 December affidavit needs to be qualified by what was said elsewhere in the 6 December affidavit, along with what was said in Court later that day.

As for the 4 December email, the defendant submitted, in summary, as follows:

(a) the statement relied upon by the plaintiff needs to be viewed in the context of the email as a whole, where Mr Bruce stated words to the effect that the defendant had not “yet” identified any further documents, that the review was ongoing and at an advanced stage, and that any documents found would be discovered;

(b) the plaintiff’s assertion that the contents of the 4 December email demonstrate that the defendant was resisting the provision of further discovery was incorrect; and

(c) again, the statements in the 4 December email need to be read in the context of the statements in the 5 December affidavit, the 6 December affidavit, and the statements made during the hearing on 6 December 2017.

In relation to the 29 December letter, the defendant noted that the plaintiff complained about two statements in this letter, namely:

(a) the reason why the defendant was required to give further discovery was because he consented to an order; and

(b) the documents discovered by the defendant in its supplementary affidavit of documents did not meet the test for discovery under r 29.01.1 of the Rules.

In relation to 61(a) above, the defendant submitted that this statement was unremarkable, as the scope of banking, financial and other documents sought in the discovery summons bore no relationship to the issues in the proceeding as disclosed by the parties’ pleadings. The plaintiff’s assertion that the defendant did not dispute the relevance or discoverability of the categories of documents in the discovery summons was clearly untrue: rather, as the defendant did not oppose providing further discovery at the hearing on 6 December 2017, the question of the relevance of the categories of documents referred to in the discovery summons was not determined one way or the other.

In relation to 61(b) above, the defendant submitted that the plaintiff’s disagreement with the defendant’s legal representative’s opinion regarding the scope of the defendant’s discovery obligations does not render the defendant’s solicitor’s expression of that opinion misleading or deceptive.

Further, the defendant submitted, the plaintiff does not explain how the plaintiff’s solicitors were likely to be misled by this statement of opinion, or how the plaintiff is said to have suffered loss by reason of any statement in the 29 December letter, noting that the 29 December letter referred to the defendant’s past discovery obligations.

The defendant also submitted that the plaintiff’s allegation that the defendant failed to correct or explain these statements is simply untrue: the 29 December letter provided a detailed and fulsome explanation of the defendant’s position.

As for the Polo Development Fund emails, the defendant submitted, in summary, as follows:

(a) in relation to exhibit P65, the defendant submitted that the disclosure of this document occurred at the earliest reasonable time after the defendant and his legal representatives became aware of the document, during an extensive search for further documents;

(b) further, the plaintiff’s assertion that the document concerns the existence of the Polo Development Fund is incorrect;

(c) the trial judge held that no such fund ever existed, and that there was no legally binding agreement to create such a fund;

(d) this document was relevant and discoverable, but not critical. It is largely neutral; and

(e) as for exhibit P114, the defendant submitted that the mere fact that a document relates to an issue in the proceeding does not make it a critical document.

As for the plaintiff’s assertion that the FIP documents were also critical documents, the defendant submitted that this allegation was wholly embarrassing, as the plaintiff fails to identify any particular document in the supplementary discovery as being a critical document, and by extension, how it was said to be a critical document. In any event, once any of the FIP documents were found, they were discovered.

In relation to the plaintiff’s allegation that Mr Bruce’s statement in paragraph 10 of the 5 December affidavit to the effect that all of the FIP documents have been discovered, the defendant submitted, in summary, as follows:

(a) it is incorrect to say that paragraph 10 asserted that all of the FIP documents had been discovered;

(b) in particular, in relation to categories 1 and 2 in the discovery summons, [9] there was a statement to the effect that a subset of those documents had been discovered;
[9]Being any agenda, minutes, notes of meetings, resolution or motions (including drafts) of the EC or C of A between January 2013 and December 2016 which related to the plaintiff’s accusations identified in the pleadings.

(c) this statement needs to be read in the context of the affidavit as a whole, and in particular the following qualification:

The Defendant, having undertaken a further review and examination of the Defendant’s discovery is unaware of any document referred to in categories 1 and 2 that has not already been discovered and to the best of its knowledge has discovered all such documents:

(d) the 5 December affidavit also states that the defendant was prepared to provide any further documents to the plaintiff; and

(e) as for the plaintiff’s allegation that the defendant failed to correct or explain his allegedly misleading statements, the statements in the 5 December affidavit were qualified by the 6 December affidavit and what was stated in Court on 6 December 2017. In any event, the underlying statements were not misleading or deceptive.

Further, the defendant submitted that in the 4 December email, Mr Bruce told the plaintiff’s solicitors that the hearing on 6 December 2017 was not required. The defendant also observed that in the current application, the plaintiff appeared to be proceeding on the assumption that the original discovery was inadequate, without explaining how it was inadequate.

Finally, the defendant submitted as follows (citations omitted):

Any claim for costs and/or damages for financial loss under s 29 of the CPA is to be evacuated in accordance with the traditional principles of causation: the conduct complained of must be a substantial cause of the losses suffered.
The plaintiff makes no attempt to state or establish by evidence any such substantial cause of loss. Most of the conduct complained of occurred on 4, 5, 6 and 29 December – yet there is no evidence as to how the plaintiff was likely to be misled or incurred costs on or after those dates.

In his written outline of submissions in reply, the plaintiff rejected the defendant’s characterisation of the findings of the trial judge regarding the plaintiff’s motivations and conduct.

With regard to the threshold issue, the plaintiff submitted that the costs of the discovery summons were expressly excluded from the plaintiff’s application with respect to the costs of the substantive proceeding. Further, the plaintiff’s application for leave to appeal was limited to the issue of the defendant’s failure to respond to settlement offers. No allegations were made with respect to the alleged breaches of the CPA which are the subject of the CPA summons.

The plaintiff submitted that the defendant’s opposition to making further discovery was plain from the correspondence between the parties leading up to the issue of the discovery summons and from a fair reading of the transcript of the hearing on 6 December 2017. The defendant did not say, at the outset of the hearing on 6 December 2017, as he could have done, that there was no need for a hearing, because he was going to provide further discovery, which could be attended to within a certain period of time, and the hearing of the discovery summons should be adjourned until that was done.

The plaintiff submitted as follows:

Whilst the defendant chose not to contest the relevance of the categories sought, at no stage did he consent to requests in correspondence or orders that he file a supplementary affidavit of documents in relation to those categories. Indeed Mr Bruce made an affidavit dated 5 December for the purposes of that hearing which stated that all documents in categories 1-6[10] had already been discovered. Whilst the affidavit stated at [11] that some documents in other categories would be provided, it was made clear that the defendant would not be providing further documents in categories 1-6. The Court ultimately ordered that the defendant discover documents in all categories, and many documents in categories 1-6 were subsequently discovered. Similarly, during argument at the hearing, counsel for the defendant sought to resist the making of orders to file a supplementary affidavit of documents. It follows that the plaintiff is correct to submit that the defendant opposed the discovery orders.

[10]Namely, the FIP documents.

The plaintiff submitted that the defendant’s submissions to the effect that Mr Bruce’s statements were made on instructions were not the subject of any evidence. In response to the defendant’s complaint that he did not understand which documents contradicted Mr Bruce’s statement in paragraph 8 of the 6 December affidavit, the letters from the plaintiff’s solicitors dated 11 December 2017 and 16 February 2018 (to which no response was ever received) clearly identified the documents which contradicted those statements.

The plaintiff submitted that the following statements of Mr Bruce in the 4 December email was unqualified and absolute:

We can, however, already at this stage that contrary to the assumptions behind your application you in fact have been provided in categories which you assert to be incomplete.

The plaintiff submitted that:

The 107 documents discovered by the Defendant on 29 December 2017 included: (i) numerous minutes of meetings of the CofA and EC, a number of which record (obviously in writing) motions and resolutions; (ii) 10 separate motions or resolutions (ie, not forming part of any minutes); and (iii) at least 4 reports of the EC to the CofA. These matters plainly demonstrate that paragraph [8] of Mr Bruce’s 6 December Affidavit was likely to mislead or deceive, and the defendant and Mr Bruce cannot be in any doubt about how the plaintiff puts this aspect of his application.

The plaintiff submitted that the plaintiff made an application that the managing judge said that the plaintiff needed to make, and the defendant’s response, only two days prior to the return date of the discovery summons, was to the effect that there were no further documents to discover.

As for (c) above, I have already observed that the incorrect statements had no real practical consequences: they did not deter the plaintiff from pressing the discovery summons, or persuade me not to make the 6 December orders.

As for (d), it is difficult for me to make any assessment of the state of mind of the defendant when providing the instructions to Mr Bruce which gave rise to the incorrect statements, as the defendant has not given any evidence about that issue. The tenor of the evidence and correspondence from Mr Bruce indicated that the defendant was adamant in his belief that he had discovered everything he was obliged to discover (relying upon the narrow test in r 29.01.01 of the Rules) but was prepared to provide further discovery if the documents were located during the discovery review. Apart from the sheer volume of the supplementary discovery itself, there is nothing in the evidence to suggest that this belief was not honestly and sincerely held. To conclude otherwise involves making a finding of serious misconduct on a flimsy evidentiary basis. Further, as previously noted, I accept that Mr Bruce did no more than act upon his instructions from the defendant, which he was entitled to do in the circumstances. Accordingly, I am prepared to conclude that the breach was careless, but inadvertent.

As for the character and reputation of Mr Bruce and the defendant, I accept that Mr Bruce is a legal practitioner of good standing and repute, and I see no reason to doubt the submission to the effect that his professional conduct has never been the subject of complaint. As for the defendant, I have no particular knowledge of his character and reputation, and I note that his conduct has been the subject of complaint by the plaintiff in this very proceeding. However, given his position with FIP, I am prepared to accept that he must be held in high regard by most in the circles in which he moves.

As for (f), I have already noted that while the debate between the solicitors for the parties concerning the defendant’s discovery obligations was quite torrid, there was nothing in the plaintiff’s solicitor’s correspondence which was particularly objectionable, such that it provided or otherwise contributed to the breach.

Given my findings with respect to s 20 of the CPA, and the consequences of those findings, along with the fact that the proceeding has now concluded, there seems to be limited, if any, utility in making a declaration with respect to the incorrect statements. As for the issue of specific and general deterrence, I doubt that the object of specific deterrence carries much weight in the current context. Mr Bruce is in his senior years, and will presumably be retiring from active legal practice in the not-too-distant future. The defendant is also a senior gentleman, who is resident overseas, and, I am willing to hazard a guess, is unlikely to be willingly involved in litigation in this jurisdiction ever again. The proceeding is over, and the events in question took place nearly four years ago.

As for whether a declaration should be made in order to warn legal practitioners and parties of the potential perils of breaching the overarching obligations, that is a more compelling argument in support of making a declaration. However, the deterrent force of such a declaration is more limited in circumstances where I have already awarded compensation to the plaintiff by reason of the defendant’s and Mr Bruce’s breach of the obligation to co‑operate with the other party and the Court. A reader of these reasons would not draw the conclusion that breaches of the overarching obligations have no consequences.

Taking all of the above factors into account, the matter is finely balanced, but overall, they weigh in favour of declining to exercise the discretion to make a declaration to the effect that, by making the incorrect statements, the defendant and Mr Bruce breached their obligation not to mislead or deceive. Again, I accept that Mr Bruce made the incorrect statements on instructions from the defendant, who I believe, honestly, if stubbornly, considered that he had fulfilled his discovery obligations. The incorrect statements were made in the context of robust debate where, despite everything, the defendant and his legal representatives believed that he was trying to move matters forward by undertaking the discovery review. That they communicated their intentions in a manner which was apt to cause confusion and doubt is unfortunate, but I accept that was their genuine intention. The incorrect statements had no practical consequences, and the making of a declaration will have limited, if any, utility as well.

Section 26 of the CPA: the Polo Development Fund emails

The plaintiff contends that the defendant’s failure to discover the Polo Development Fund emails was a breach of the defendant’s obligation under s 26 of the CPA to discover, at the earliest possible time, critical documents. I accept that the test for determining whether a document is a critical document is as set out in the plaintiff’s written submissions, that is, a critical document is a document which a party would reasonably be expected to have relied upon as forming the basis of a party’s claim when commencing the case, as well as documents that the party knows will adversely affect the case.

The defendant submitted that the Polo Development Fund emails were relevant, but were not critical documents, and that, in any event, the defendant discovered the Polo Development Fund emails as soon as they were located and retrieved.

Turning first to the question of whether the Polo Development Fund emails were critical documents, the plaintiff’s contentions in that regard could be made out by reference to one paragraph in the trial judge’s reasons following the trial of the substantive issues in the proceeding, as follows:

The existence of a [Polo Development Fund] is the most controversial factual issue in the case. It impacts upon the defendant’s defence to the plaintiff’s claim and to the defendant’s counterclaim.[36]

[36][2019] VSC 433 [310].

The controversy regarding the evidence or otherwise of the Polo Development Fund first arose in the defendant’s defence and counterclaim. In his statement of claim, the plaintiff alleged that the defendant’s emails were defamatory, in that they carried the imputation that the plaintiff makes accusations that are not genuine, authentic or truthful. The defendant relied upon the statutory defence of justification, and the common law defence of truth, alleging that the plaintiff had made accusations regarding the Polo Development Fund which were not genuine, authentic or truthful. The defendant provided the following particulars to this allegation:

Particulars
i.The accusations are stated in emails of the plaintiff to FIP’s members, office holders and delegates and principal sponsor dated 22 May 2015 at 9.23 a.m. and 6 November 2015 at 2:58 p.m and are as follows:
(a)FIP had failed to establish provision for a USD$600,000 polo development fund in the accounts of FIP;
(b)FIP had failed to report disbursements from the USD$600,000 polo development fund;
(a)The defendant’s stated concern for confidentiality was feigned and tongue in cheek and used as an excuse for not acting earlier;
(b)A legally binding agreement had come into existence between FIP and MPC for the creation of a USD$600, 000 polo development fund; and
(c)All members are entitled to know how the USD$600,000 fund was received, has been applied, the purpose for which it has been applied and what remains thereof.

ii.The above accusations are untrue on the basis that FIP did not enter into a contract with MPC for the creation of a USD$600, 000 polo development fund.
iii.Further, the allegations of the plaintiff regarding the Polo Development Fund were made by the plaintiff in the knowledge that they were false. The particulars of the plaintiff’s knowledge are (a) the plaintiff was involved in the negotiation and execution of written heads of agreement between FIP and MPC and those heads of agreement make no provision for the establishment of a $600,000 polo development fund; and (b) the plaintiff was an officer of FIP and would therefore know that the Executive Committee never approved a $600,000 polo development fund.
iv.Alternatively, the accusations were made without proper basis or attempt to verify their accuracy.
v.The accusations were made as part of a course of conduct in which the plaintiff made multiple accusations that were untrue (as to which see each of the subparagraphs above and below).
vi.The accusations were made as part of a course of conduct in which the plaintiff sent insulting emails to FIP’s members, office holders and delegates on a continuing basis. The emails are identified in Schedule 1.

The defendant also pleaded that the plaintiff’s emails regarding the Polo Development Fund were copied to a major sponsor, such that the imputation to the effect that the plaintiff acted in such a way as to threaten or undermine major sponsors of FIP was true.

Accordingly, the question of the existence of the Polo Development Fund was a live issue on the pleadings at an early stage of the proceeding.

It is against that backdrop that I turn to the Polo Development Fund emails themselves.

The trial judge summarised the parties’ respective positions with respect to the Polo Development Fund as follows:

The combination of the accusations made in these all emails is to the following effect:
(a)A legally binding agreement was entered into between FIP and MPC/Goldin to allocate US$600,000 over three years to a fund devoted to the development of polo in the Asian region (the PDF).
(b)The existence of this PDF was known to RC, NC-D and AT.
(c)FIP had a financial responsibility to properly administer the PDF.
(d)FIP has failed to report on the existence and administration of the PDF.
(e)FIP has failed to provide for the PDF in its accounts.
(f)FIP has failed to report on disbursements from the PDF.
(g)FIP has failed to disclose how the PDF was received.
(h)FIP has failed to disclose how the PDF has been applied.
(i)FIP has failed to disclose the purpose for which those funds were received.

The defendant contends that these accusations made by the plaintiff are untrue:
(a)FIP did not enter into a binding legal contract with MPC/Goldin for the creation of a US$600,000 PDF.
(b)The plaintiff knew this to be the case because he was an officer of FIP, involved in the negotiations with MPC/Goldin and also involved in the negotiation and execution of two Heads of Agreement between FIP and MPC/Goldin.
(c)As an officer of FIP, he would have known that the EC had never approved a US$600,000 PDF.
(d)In making the accusations contained in the series of relevant emails, the plaintiff dishonestly alleged that there was a binding legal contract between FIP and MPC to allocate US$600,000 over three years to a fund devoted to the development of polo in the Asian region (the PDF).[37]

[37]Ibid [317]-[318].

The trial judge observed that “a good deal of the oral evidence in the case occupied this topic”. He concluded his analysis as follows:

After anxious consideration, I am satisfied, on balance, that there was no completed agreement between the two parties to establish the impugned PDF. I am certain that it was discussed in some detail. I think it probable that MPC wanted US$200,000 per annum to be spent on polo development. If, however, MPC wished to bind FIP to allocate that sum specifically each year to polo development, then I consider there would very likely be some contemporaneous written record of such an agreement. And there is not.[38]

[38]Ibid [364].

Both of the Polo Development Fund emails were tendered in evidence, with the trial judge making a specific reference to exhibit P65 in his reasons. Exhibit P114 was only referred to in a footnote in which the trial judge listed the exhibits he had considered regarding the correspondence concerning the Polo Development Fund.

Exhibit P65 was headed “In Strictest Confidence” and is reproduced in part below:

Dear Alex,
Another long and illuminating conversation with Harvey this morning which I did not want to put through official channels hence using your private e-mail. I believe I now understand what happened, PY’s view and also those of Goldin/Metropolitan although at the outset I have to say that Harvey and Mr. Pan appear to be going to have to swallow the past to be able to progress with us in the future which is a relief!
It would appear that the verbal agreement reached between PY/AJ and Goldin was, as PY claims, a 3 year $200k Polo Development Fund (hence his $600k figure) and the $300k per annum hire a CEO and to set up an office in HK and for Mr. Pan to become a Vice President. I am told by Harvey that Mr. Pan had offered them a set of offices in the Goldin Building and PY/AJ had approached Torrey Dorsey who used to work at Singapore Polo Club and now works at the HK Yacht Club to be the new CEO for FIP. However, on the advice of the legal counsel for Goldin/Mr. Pan for company accounting budgets and local tax authority purposes they needed to be able to produce a contract or contracts to the authorities (and presumably the Goldin auditors) as some form of marketing contract/s for it to be acceptable.
So here we have two parties working together to ‘fudge’ the issue. Understandably Harvey/Pan assumed that since they were dealing with two serving members of the EC It was sanctioned by FIP, however, they appear to have been totally unaware that PY/AJ were not reporting back to the EC for their own reasons, presumably because they wanted to have complete control over the situation and contacts. Thus PY/AJ were not presenting the full picture or requesting the EC’s approval or vote on the proposal and the EC were only aware of the two final contracts they were presented for signature.
I believe that Goldin are well aware that they are at fault and in a difficult situation over this as they are in an awkward position for trying to deceive both their investors and the authorities by misrepresenting the actual purpose of the contracts. PY/AJ are more at fault for not being totally open and keeping the EC and administration of the time fully informed as to the terms and conditions behind the two contracts and for not getting official EC approval, which may well have been withheld had we known the circumstances.
...

Exhibit P114 is reproduced in part below:

Dear Peter,
...
We believe we have finally established all the facts behind these accusations and they will be clearly laid out at the end of the GA for anyone who is interested in hearing them and the EC will stay until all these accusations are discussed and settled in the hope we can finally move on.
At the end of the day this all arose from bitterness because PY was removed from the EC & then subsequently AJ. During their time on the EC they produced no minutes of meetings and never kept the EC fully informed of what they had tried to negotiate with Goldin, nor did they attempt to get any deal approved by the EC. Even when both Lesley Ru and I were put onto the China Committee to encourage some transparency we were kept out of the loop and in the dark.
We understand that this was because they were lying to get all the funds raised by the Snow Polo World Cup and the Super Nations into an account set up in Singapore and controlled initially by AJ for the sole use of Zone D. They both knew that neither the EC or the participating Nations would approve of the funds raised by teams from all the Zones being used exclusively on a single Zone.
The EC being unaware of what PY & AJ had discussed with Goldin was placed in the position of assuming that the written contract signed by the then FIP President Eduardo Huergo and Goldin which contained no mention of any ‘Zone D Development Fund’ as being the official written documentation which the EC relied on.
The matter has been discussed with Goldin who assumed they were dealing with FlP when negotiating and are happy to move on and we will be having a smaller Snow Polo World Cup again in 2016 due to the economic climate in China. They are fully supportive of FIP in this matter.
...

In my view, having regard to the substantive issues in the proceeding, exhibit P65 was a critical document, which should have been disclosed at the earliest opportunity, while P114, while relevant, was not a critical document. Originally, the defendant maintained a blanket denial of the existence of the Polo Development Fund. Ultimately, the trial judge concluded, “anxiously”, that while there was indeed a well-advanced proposal to establish a Polo Development Fund, there was no binding agreement to do so. This finding was consistent with the contents of exhibit P65, where the defendant expressed the opinion that a verbal agreement had been reached at the instigation of the plaintiff and another, without the knowledge and/or authorisation of the EC. That is a far more nuanced position than that adopted by the defendant in his pleadings. Ultimately, the trial judge concluded that, as a matter of law, no legally binding agreement came into being. However, that conclusion in no way detracts from the significance of exhibit P65 to a major factual dispute between the parties in the proceeding. However, exhibit P114 adds little to the matters referred to in exhibit P65.

The defendant submitted that the Polo Development Fund emails were discovered as soon as the defendant became aware of them, relying upon the evidence of Mr Abrahams in that regard. Regardless of whether that evidence is admissible or not, the evidence is unsatisfactory. It seems inherently implausible that the defendant did not recall writing the email, which clearly concerned a sensitive matter, so sensitive that it was headed “in strictest confidence”. The email was written in the months prior to the circulation of the defendant’s emails, and the original discovery was made in the months after the defendant must have provided detailed instructions to his legal representatives about his defence and counterclaim, where the plaintiff’s allegations about the Polo Development Fund were addressed in some detail. In those circumstances, it was incumbent upon the defendant, being the author of the Polo Development Fund emails, to provide a more direct and fulsome explanation as to why the Polo Development Fund emails were not produced earlier.

No compensation is payable to the plaintiff by reason of the defendant’s breach of s 26 of the CPA. There is no evidence that the breach caused the plaintiff to incur additional costs, and the late disclosure of exhibit P65 did not cause any delays in the conduct of the proceeding. However, I do consider that it is appropriate to make a declaration to the effect that the defendant breached s 26 of the CPA, having regard to the factors referred to in paragraph 147 of these reasons.

The failure of the defendant to disclose exhibit P65 at an early stage, perhaps contemporaneously with the delivery of his original defence and counterclaim in October 2016, remains unexplained. The plaintiff had no basis for knowing of the existence of the Polo Development Fund emails, such that his conduct is irrelevant to the exercise of the discretion. The breach was serious, given the forensic significance of exhibit P65 to what the trial judge described as the most controversial factual issue in the case.

Further, it seems to me the principle of general deterrence has some relevance to the question of whether a declaration should be made. The enactment of s 26 of the CPA was not only aimed at promoting more efficient case management, it also sounded the death knell for trial by ambush. Provision of critical documents at an early stage of a civil proceeding not only prevents the late adjournment of trials by reason of late disclosure of documents, but also facilitates the early resolution of civil proceedings by ensuring that parties are fully aware of the strengths and weaknesses of their positions prior to embarking upon formal and informal alternative dispute resolution processes.

For completeness, I accept the defendant’s submissions that the plaintiff’s allegation that the FIP documents provided in the supplementary discovery were critical documents lacks particularity, such that it is not possible to meaningfully assess whether the FIP documents, or any of them, were critical documents.

Conclusion

These reasons will be accompanied by draft orders to give effect to these reasons, and to provide the parties with an opportunity to make further written submissions with respect to the parties’ costs of this application.

[2021] VSC 243

11 June 2021