Carina Yachts Limited v Dunsford Marine Limited HC Auckland CP 290 SD 00

[2001] NZHC 738

IN THE HIGH COURT OF NEW ZEALAND
AUCKLAND REGISTRY CP 290 - SD 00

BETWEEN CARINA YACHTS LIMITED
Plaintiff

AND DUNSFORD MARINE LIMITED
Defendant

CP 501 - SD99

BETWEEN R EADY
Plaintiff

AND DUNSFORD MARINE LIMITED
Defendant

Hearing: 13 August 2001

Counsel: W D McKean for Plaintiff
P A Robertson for Defendant

Judgment: 13 August 2001

ORAL JUDGMENT OF PRIESTLEY J

Solicitors: Webb Ross Johnson, DX AP 24056, Whangarei
Heaney & Co, DX CP24052, Auckland

The application

[1] The applicant seeks production of certain documents in respect of which privilege was claimed in the defendant’s supplementary list of documents dated 17 January 2001. The application lists in paragraph 2 the documents which are at issue.

[2] It has not been necessary for the purposes of this application for me to view the documents as I would have been entitled to do pursuant to the provisions of r 311.

[3] Counsel agree on the description of the documents in issue. They comprise exchanged briefs of evidence, relevant exhibits referred to in those briefs, and the notes of evidence taken in a proceeding before Morris J last year. The plaintiff in that proceeding was AGC Finance. The defendant was the current defendant. The proceeding was CP 160/97 (High Court Auckland) and Morris J’s decision was delivered on 1 September 2000.

[4] It was accepted by counsel that there was a high degree of overlap between that proceeding and the proceeding before me today. Essentially AGC was this plaintiff’s financier having advanced monies on the security of a vessel in respect of which the defendant had provided a marine valuation. It is alleged that the defendant’s valuation in issue was negligent and/or relevantly defective in some regard.

Privilege

[5] There are obviously two classifications for the documents. The first is the classification of exchanged briefs and associated exhibits. The second classification is the notes of evidence.

[6] The relevant briefs appear to have been exchanged pursuant to the provisions of rules 411A to 441J of the High Court Rules. In support of his application Mr McKean referred me specifically to r 411A which has the significant heading “Privilege and Admissibility”. It is not necessary for the purposes of this decision for me to traverse Mr McKean’s argument. Suffice to say that his core argument was that at the stage the briefs of evidence became a matter of public record, - that being when the brief was read out in open Court, - any properly claimed privilege was lost.

[7] Counsel accepted that the plaintiff would undoubtedly be able to search the Court record for last year’s proceeding pursuant to rules 66 and 68 of the High Court Rules. In his submission, however, privilege having been claimed by the defendant, there was an understandable reluctance to obtain the same information through possible back doors such as searching the Court file or indeed through a direct approach to AGC.

[8] In respect of the second category (the notes of evidence) counsel referred me to the decision of Eichelbaum J in R v Mills [1984] 2 NZLR 92 which contains an interesting historical analysis of the modern day transcript which appears to have evolved from judges availing themselves of typewriters in lieu of handwritten notes. In Mr McKean’s submission the transcript made by Morris J’s associate and distributed in the normal way to counsel appearing before him was akin to a public record of a public hearing.

[9] For the defendant Mr Robertson’s argument raised important matters of principle which had clearly perplexed both him and his client. Mr Robertson referred to the fact that the briefs of evidence which had been listed were not all briefs prepared by the defendant. They also included briefs which had been exchanged prior to the trial by AGC. Mr Robertson properly and correctly pointed out that AGC’s privilege was not for him to waive. At a pragmatic level I was informed that many of the briefs were the subject of supplementary additions at the start of or during the trial and, as is so frequently the case, some of the briefs may have been subject to addition or correction as they were read out by the relevant witnesses as evidence in chief.

[10] Put concisely Mr Robertson’s submission on this latter point was that there was no necessary exact correspondence between the briefs which had been discovered (the product of the normal exchange of briefs) and the evidence given viva voce at the trial.

[11] The defendant further submitted that some of the documents in question related to another vessel, the fishing vessel “Dorada”,which is not the subject of this proceeding. Principles of relevance would prima facie exclude discovery of any such documents.

[12] On the second issue of the notes of evidence Mr Robertson submitted that the notes of evidence had been taken at the direction of Morris J and that there might well be something akin to an undertaking to the Court not to disclose those notes of evidence to non-parties or use them for other civil proceedings without the permission of the Court.

[13] I was also referred to the significant House of Lords decision Home Office v Harman [1983] 1 AC 280; [1982] 1 All ER 532. This was a majority decision of the House of Lords. It related to contempt proceedings against a solicitor who handed a document to a newspaper reporter which had been obtained on discovery in respect of which an express undertaking had been given not to use that document “except for the case in hand”. The document was read out in its entirety during counsel’s opening address prior to it being handed to the press. The majority held that a duty attached to a solicitor who obtained possession of a document in that situation not to allow the document to be used for an ulterior or collateral purpose and that such an obligation was not cancelled by the mere fact that the document had been read out in open Court.

[14] For my part, if I was required to decide that or a similar issue de novo, I would be attracted by the powerful dissenting speech of Lord Scarman who made the undoubtedly correct and pragmatic observation that unless a restriction was imposed by a trial Judge there was no inconsistency between publication of the document and a solicitor’s undertaking once the document had been read out aloud in open Court.

[15] I see important distinctions between the principle enunciated in Home Office v Harman (supra) and the current case. The most obvious distinction is that the issue in the case before me relates solely to whether privilege has been correctly claimed. There is no concomitant undertaking and certainly no undertaking of an express nature which attaches to the briefs exchanged during the proceeding before Morris J.

[16] Mr Robertson conceded that some of the briefs listed in the defendant’s list of documents might well coincide exactly with what was said in open Court. He was, however, uncertain as to how many documents fell into that category.

[17] In his reply Mr McKean correctly pointed out that the gap between the parties was not wide so far as the over-arching legal principles were concerned. He expressed some understandable concern that the defendant’s written memorandum filed over three months ago (paragraph 5) did not stipulate the distinction between exchanged briefs and evidence actually given. Undoubtedly the defendant’s memorandum does not put this point as clearly as its counsel has today.

Decision

[18] Any briefs of evidence which relate solely to the vessel “Dorada” rather than to the vessel “MY Carina” which is the subject of this proceeding, clearly have no relevance and need not be disclosed.

[19] The briefs of evidence and exhibits which relate to the vessel in whole or in part are relevant. A bar on compelling disclosure is that privilege must attach to those documents which were all created for the purposes of the AGC proceeding heard before Morris J last year. Once evidence had been given in open Court clearly privilege is lost at that point. The evidence of the witness and any related exhibits become a matter of public record. The clog, however, on compelling disclosure of the briefs which appear on the defendant’s file must be uncertainty as to whether those briefs accurately and precisely reflect the evidence which was given in public. I am not for that reason prepared to order global production.

[20] So far as the notes of evidence are concerned these are in my judgment a transcript of evidence given in open Court. Privilege certainly does not attach. The issue of courtesy to the Court is a matter unconnected with the issue of privilege. I order the production of those notes of evidence subject only to counsel for both parties signing a joint memorandum addressed to Morris J informing him both of my decision and more importantly, that copies of his notes will for the purpose of this proceeding be disclosed to a non-party to the proceeding before him last year.

[21] It would be my hope that the solicitors for the parties can speedily co-operate to identify any briefs of evidence held by the defendant which coincide precisely with the evidence given in open Court. I cannot of course compel the parties to cooperate in that fashion but there are obvious pragmatic advantages in so doing. In any event it seems to me that the plaintiff has a right under rules 66 and 68 of the High Court Rules to inspect the CP 160/97 file. To place the matter beyond doubt, however, I expressly direct that Court file in its entirety is to be made available to the plaintiff’s solicitor for inspection. I further direct the defendant’s solicitors to serve a copy of my decision on the solicitors who acted for AGC in last year’s proceeding and reserve leave to AGC to express in memorandum form within 7 days any objection to my direction in the unlikely event of there being one.

Costs

[22] Mr Robertson has applied for costs. In his submission the application was probably unnecessary and cannot really be said to have succeeded. I am obliged to fix costs on all interlocutory matters under r 48E but I nonetheless have an overriding discretion in respect of costs under r 46(1) although such a discretion must not be exercised in an arbitrary or capricious way.

[23] My view on costs is tempered somewhat by the fact that the defendant for its part has changed its counsel within the same firm. Both Mr Robertson’s predecessor and also Mr McKean have had personal distractions in recent times. I tend to the view that in large measure this application was unnecessary and that a frank exchange of reasons and alternative routes to the same information could have been explored by counsel in a co-operative and non-adversarial way.

[24] The decisive argument so far as the defendant was concerned on the issue of the production of the briefs of evidence was the argument about possible differences between those briefs and the evidence given in open Court. Even today there is no certainty as to which briefs coincide and which briefs do not. Nor was that argument clearly signalled in April.

[25] In the overall interest of justice and fairness I consider that this application, interesting though it has been, has been disproportionate to the weight and relevance of the documents involved. For that reason, for the reason expressed in paragraph [24] and also because I do not consider that either party can claim to have “won” decisively, I order that each party is to bear its own costs.

Timetable orders and directions

[26] After discussion with counsel I direct that the plaintiff is to bring any interlocutory application required to join third or other parties within 21 days.

[27] I further direct the Registry to allocate an evaluation conference (30 minutes) on the first available date after 7 September 2001.

[28] In the event that there is no joinder of a third or other party that conference should be treated by counsel as a pre-trial conference with a view to obtaining any further timetable orders or directions preparatory to trial.