Lombard Finance & Investments Limited (in rec) v McCarthy HC Auckland CIV 2009-404-4104

[2010] NZHC 1187

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV 2009-404-004104

BETWEEN  LOMBARD FINANCE & INVESTMENTS LIMITED (IN RECEIVERSHIP)

Plaintiff

ANDGREGORY CHARLES MARTIN MCCARTHY

Defendant

Hearing:         7 July 2010

Counsel:         G M G Joe for plaintiff

T J G Allan for defendant

Judgment:      9 July 2010 at 3:00pm

INTERIM JUDGMENT OF ASSOCIATE JUDGE ABBOTT

This judgment was delivered by me on 9 July 2010 at 3:00pm, pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors:
Simpson Grierson, PO Box 2402, Wellington 6140 for plaintiff

Grove Darlow & Partners, PO Box 2882, Auckland 1140 for defendant

LOMBARD FINANCE & INVESTMENTS LIMITED (IN RECEIVERSHIP) V MCCARTHY HC AK CIV

2009-404-004104  9 July 2010

[1]      This proceeding came before the court in the Chambers List on 7 July 2010 to address an application by the defendant (court doc #24) for further and better discovery and,  by direction  of  the  civil  list  judge,  to  address  a  request  by the defendant  for  adjournment  of  a  judicial  settlement  conference  scheduled  for

2 August 2010, and a 4 day trial scheduled to commence on 18 October 2010.

[2]      Counsel have filed memoranda setting out their clients’ respective positions. Oral argument was also heard following the list matters.  Because of time constraints I made orders at the conclusion of the hearing without giving reasons, and said that I would confirm the orders immediately, in writing, but would not provide detailed written reasons unless requested to do so by counsel.   I direct that any request be made by 5 pm on 12 July 2010.

[3]      Before confirming the orders, I will set out briefly the issues. [4]           Essentially there were two issues for determination:

a)       Whether a claim by the plaintiff for confidentiality in respect of bank statements  should  be  upheld  (to  expedite  matters  ahead  of  this hearing, counsel for the defendant has agreed to undertakings restricting disclosure of the bank statements pending a determination by the court); and

b)Whether the defendant can properly prepare both for the judicial settlement conference and for trial given the volume of supplementary discovery just provided by the plaintiff, and the restrictions on disclosure.

[5]      The plaintiff claims confidentiality in the bank statements on the basis of both commercial sensitivity and obligations to third parties in respect of information shown on the statements (it also questions whether and how information on the bank statements could be relevant but has agreed to disclose them for pragmatic reasons).

It accepts that statements be made available to counsel and experts, but resists any further disclosure without consent, to be given only after the defendant has identified which bank statements it wishes to put to witnesses and what information within them.

[6]      The defendant contends that the restrictions are unnecessary as the usual rules as to disclosure of discovered documents adequately protect these matters, and that the terms which the plaintiff seeks to impose are unreasonable as they would require him to divulge lines of inquiry and detail of his case which would not ordinarily be required.  The defendant also says that one of the witnesses to whom he wishes to put these documents, a Mr Bretherton, will already be familiar with most of the information (having been an employee of the plaintiff and having undertaken work for the receiver).   Counsel also wishes to put the documents potentially to other witnesses.

[7]      Turning to the application for adjournment, the defendant says that he is being prejudiced by the plaintiff’s delay in providing the documents (a substantial supplementary list was filed only on 2 July 2010).  His counsel, Mr Allan, has been heavily engaged in other matters since the documents were made available, and is on leave next week.  He will not be able to address them until the following week, even to consider what further information he may need to put to witnesses ahead of the judicial settlement conference.  Although he has junior counsel working with him he still needs to assess the significance of the documents, particularly ahead of the delivery of the defendant’s memorandum for the judicial settlement conference.  The defendant says that he should not be prejudiced by the plaintiff’s delay in producing these documents.

[8]      The plaintiff contends that the defendant cannot be prejudiced.  It disputes the relevance of all of the supplementary discovery (they deal with a period of time well after the date on which the defendant is said to have signed a guarantee in reliance on certain representations).  As with the bank statements, it says that it has provided the supplementary list for pragmatic reasons.  Mr Joe, for the plaintiff, also contended

that it was not necessary for the defendant to examine the documents in detail before the settlement conference (there was sufficient time to take them into account for the purpose of the conference), and that there was ample time to examine them in detail and effect a full briefing of witnesses before the defendant was required to serve his briefs for trial.

[9]      Against that background I made the following orders.

Confidentiality

[10]     I consider that it is reasonable to allow the bank statements to be shown to Mr Bretherton, certainly on the basis of an undertaking by Mr Bretherton similar to that sought from counsel and solicitors.   If there is any difficulty in Mr  Bretherton providing that undertaking I reserve leave for the defendant to come back to the court by memorandum, and seek a telephone conference to consider further directions.

[11]     In respect of disclosure of bank statements to other potential witnesses,   I consider the best approach is to set up a procedure for the defendant  to come back to the court and and ask for leave to disclose the bank statements (that is, for counsel to be relieved from his undertaking), perhaps with the witness to provide an appropriately amended undertaking.  The issue, I suspect, will be whether or not the defendant will need to disclose the identity of those witnesses.

Adjournment

[12]     The judicial settlement conference is to remain in place. but I will investigate the possibility of deferring it by a short period, and I am thinking of a week or so, so as to allow more time in the timetable leading to it (and make a consequent adjustment to the timetable for delivery of briefs for trial).  I will adjust the timetable for delivery of memoranda in any event by 5 working days.

[13]     At this point the trial is to remain.  There will be an adjusted timetable for exchange of briefs and at this stage I would anticipate that time for delivery of briefs will go back by 3 weeks.  That is possibly going to give enough flexibility to allow a change to the date of the judicial settlement conference.   Again, I am going to reserve leave for the defendant to revisit this following the judicial settlement conference.   I would expect that at the settlement conference the issues will be refined more than they have been at this stage, and that will give the defendant a better understanding of whether there are aspects which he cannot brief in the time available.

Amended directions

[14]     Since the hearing I have been able to obtain a slightly later date for the judicial settlement conference.   The fixture for 2 August 2010 is vacated.   The conference will now be held at 10 am on 6 August 2010 (one day).   The timetable for delivery of memoranda for the conference is amended as follows:

a)        The plaintiff is to file and serve its memorandum by 27 July 2010;

b)        The defendant is to file and serve his memorandum by 3 August 2010. [15]  Leave is reserved to either party to seek an urgent telephone conference if

there is any issue over the provision of an undertaking by Mr Bretherton, or release of Mr Allan’s undertaking to allow him or another solicitor in his firm to brief other potential witnesses.

[16]     The  timetable  for  exchange  of  briefs  and  indices  of  documents  for  the common bundle is also amended as follows:

a)        The plaintiff is to file and serve his briefs and index of documents for inclusion in the common bundle, by 3 September 2010;

b)The defendant is to file and serve his briefs and any further documents for the common bundle by 4 October 2010.

[17]     The defendant’s applications are adjourned sine die, to be brought on, if necessary, on three working days’ notice.

Associate Judge Abbott