Rascal and Friends NZ Limited t/a Rascal + Friends v Taylor
[2022] NZHC 1486
•23 June 2022
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2021-404-1041
[2022] NZHC 1486
BETWEEN RASCAL AND FRIENDS NZ LIMITED
trading as RASCAL + FRIENDS Plaintiff
AND
GRANT BRUCE BYRON TAYLOR
First Defendant
KEITH ROBERT TAYLOR
Second DefendantJJK GROUP LIMITED
Third Defendant
Hearing: On the papers Appearances:
MF McClelland QC, T Mijatov and RT Daley for the Plaintiff
D Salmon QC and D Bullock for the First and Second Defendants SA Armstrong, I Rosic and ST Coupe for the Third Defendant
W Mace (National Business Review) for Applicant seeking access
Judgment:
23 June 2022
JUDGMENT OF ASSOCIATE JUDGE SUSSOCK
This judgment was delivered by me on 23 June 2022 at 4pm pursuant to r 11.5 of the High Court Rules
Registrar/Deputy Registrar
Solicitors/Counsel:
Wotton Kearney, Auckland Lee Salmon Long, Auckland Gilbert Walker, Auckland
Harbour Chambers, Wellington Mills Lane Chambers, Auckland
Copy to: National Business Review
RASCAL AND FRIENDS NZ LTD trading as RASCAL + FRIENDS v TAYLOR & ORS [2022] NZHC 1486 [23 June 2022]
Introduction
[1] Mr William Mace of National Business Review (NBR) has applied for access to “the plaintiff’s statement of claim and any documents filed by the plaintiff to support its case, as well as any documents filed in response by the defendants”.
[2]Memoranda have been filed on behalf of the parties:
(a)For the plaintiff, dated 20 June 2022, confirming that the plaintiff does not oppose access provided that the access is on the following condition:
that the NBR is only to be provided redacted versions of the Court documents (the relevant statement of claim, statement of defence, notice of application, notice of opposition and affidavit of Mr Mowbray) once the plaintiff and third defendant provide the Registry with copies of those documents where confidential and commercially sensitive information have been redacted.
If this condition is not accepted by the NBR, then the plaintiff opposes the request for the reasons set out in its memorandum;
(b)The first and second defendants oppose access as set out in their memorandum dated 20 June 2022;
(c)The third defendant also opposes access as set out in its memorandum dated 20 June 2022.
[3] The application is governed by the Senior Courts (Access to Court Documents) Rules 2017 (the Rules). The Rules set out certain factors that must be taken into account if relevant and distinguishes between different phases of a proceeding, with privacy rights having greater weight at the pre-substantive hearing stage.1
[4] Below I set out the current stage of the proceeding and the relevant legal principles before applying the relevant factors in the circumstances of this proceeding.
1 Senior Courts (Access to Court Documents) Rules 2017, r 13(a). Contrast r 13(b) where open justice has greater weight during the substantive hearing.
Current stage of the proceedings
[5] Although the statement of claim was filed on 31 May 2021, the proceeding is still at a preliminary stage. The defendants have filed statements of defence to the statement of claim. The claim and the defences have subsequently been amended including as a result of requests for particulars.
[6] The first and second defendants’ application to strike out the plaintiff’s claim or for further and better particulars was heard on 13 June 2022. I reserved judgment. During the hearing, I made orders restricting the media from reporting on the details of confidential information that the plaintiff alleges has been shared in breach of confidence.
[7] Discovery orders have not yet been made and no close of pleadings date has been set. Importantly, the plaintiff has indicated that if their claim is not struck out, the plaintiff intends to further amend the statement of claim to provide further particulars after discovery has been completed.
Relevant legal principles
[8] The Rules provide an automatic right to access the Court’s formal record. The formal record includes judgments, orders and minutes but does not extend to pleadings or evidence.2
[9] The documents sought by the NBR are documents beyond the formal record. Rules 11 to 14 provide a process for applying to access such documents.
[10]Section 11(2) sets out the requirements for the application and provides:
11 Any person may ask to access documents
…
(2)A person may ask to access any document by providing the Registrar of the relevant court registry with a letter, an email, or any other written form of request that—
(a)identifies the person and gives the person’s address; and
2 Rules 4 and 8.
(b)sets out sufficient particulars of the document to enable the Registrar to identify it; and
(c)gives reasons for asking to access the document, which must set out the purpose for which the access is sought; and
(d)sets out any conditions of the right of access that the person proposes as conditions that he or she would be prepared to meet were a Judge to impose those conditions (for example, conditions that prevent or restrict the person from disclosing the document or contents of the document, or conditions that enable the person to view but not copy the document).
[11] Rules 11(7) and 11(8) provide the options available to a Judge when considering an application:
(7)A Judge may—
(a)grant a request for access under this rule in whole or in part—
(i)without conditions; or
(ii)subject to any conditions that the Judge thinks appropriate; or
(b)refuse the request; or
(c)refer the request to a Registrar for determination by that Registrar.
(8)Without limiting the powers in subclause (7), the Judge may refuse a request for access under this rule solely for the reason that the request does not comply with subclause (2)(a), (b), (c), or (d).
[12] In determining whether access ought to be granted under r 11, r 12 of the Rules requires the Judge to consider the nature of the request and the reasons for applying it. In addition, r 12 requires a Judge to take into account the following matters where relevant:
(a)the orderly and fair administration of justice:
(b)the right of a defendant in a criminal proceeding to a fair trial:
(c)the right to bring and defend civil proceedings without the disclosure of any more information about the private lives of individuals, or matters that are commercially sensitive, than is necessary to satisfy the principle of open justice:
(d)the protection of other confidentiality and privacy interests (including those of children and other vulnerable members of the community) and any privilege held by, or available to, any person:
(e)the principle of open justice (including the encouragement of fair and accurate reporting of, and comment on, court hearings and decisions):
(f)the freedom to seek, receive, and impart information:
(g)whether a document to which the request relates is subject to any restriction under rule 7:
(h)any other matter that the Judge thinks appropriate.
[13] If the application is before the substantive hearing, r 13(a) mandates that the Court “must have regard” to the fact that “the protection of confidentiality and privacy interests in the orderly and fair administration of justice may require that access to documents be limited”.
[14] The relevant principles are explained in Crimson Consulting Ltd v Berry.3 There is no hierarchy of factors, there is no presumption in favour of disclosure. The decision is evaluative, not discretionary.
Reasons for application
[15]The reason provided on the application form for NBR seeking access is:
There is a public interest in the conduct of these companies and individuals, and public interest in maintaining the general principles of open justice.
Is the application premature?
[16]The Rules distinguish between three phases of the proceeding:
(a)pre-substantive hearing phase (r 13(a));
(b)the period during the substantive hearing (r 13(b));
(c)the period after the substantive hearing (r 13(c)).
[17] This proceeding is currently at the pre-substantive hearing phase. As referred to above, the protection of confidentiality and privacy interests in the orderly and fair administration of justice may require access to documents is to be limited at this stage.
3 Crimson Consulting Ltd v Berry [2018] NZCA 460.
[18]In Crimson Consulting v Berry4 the Court of Appeal explained:
… when matters are still at the pleadings stage, there is an element of unfairness on parties in the publication of one side of the story. The allegations in the statement of claim have not yet been tested by the giving of evidence. There being no hearing in court, the need for transparency and public scrutiny is less, because pre-trial the court is not determining substantive issues.
[19] Similarly in Greymouth Petroleum Holdings Ltd v Empresa Nacional del Petróleo5 the Court of Appeal, in declining an application for access, held:
[25] These divisions [in r 13] reflect that during the substantive hearing open justice has greater weight, in particular in relation to documents admitted into evidence. When a court is engaged in hearing a dispute its workings, including documents referred to or relied on, should be open to full scrutiny by all members of the public, unless there are particular and strong reasons to the contrary. The public should be able to follow and understand the hearing process. However, prior to and after the substantive hearing, the importance of public scrutiny is less, as the court is not hearing and resolving the dispute. Prior to the hearing there is no guarantee the case will go to hearing at all. Therefore open justice has less weight. The parties are entitled to the protection of confidentiality and privacy within reasonable limits, given that they have not at that point aired the dispute in public. …
[20] Access to court documents is not generally permitted until all parties have filed substantive pleadings and it is often not permitted until the close of pleadings date has passed. In Hotchin v APN New Zealand Ltd, Fogarty J recognised the significance of the close of pleadings date:6
… it would be an extremely unusual step for this Court to allow a newspaper access to a statement of claim prior to a praecipe having been filed. Praecipe is the former term for an agreement between the parties that the case is ready for hearing. That agreement only takes place after the pleadings in reply have been filed and then only at a much later date.
[21]Similarly in Fuji Xerox New Zealand Ltd v Whittaker Jagose J held:7
… NBR’s application remains premature, at least until the pleadings are finalised. To the extent that there is public interest in the plaintiffs’ conduct and allegations, I consider presently it is outweighed by the orderly and fair administration of justice while the parties’ pleadings are developed for trial.
4 At [39].
5 Greymouth Petroleum Holdings Ltd v Empresa Nacional del Petróleo [2017] NZCA 490 at [25].
6 Hotchin v APN New Zealand Ltd [2011] NZAR 464 at [15].
7 Fuji Xerox New Zealand Ltd v Whittaker [2018] NZHC 78 at [9].
[22] Jagose J dismissed the application but reserved leave to the NBR to apply again “in anticipation of the close of pleadings date or in the event of any other material change in circumstances”.
[23]Again, in Scott v ANZ Bank New Zealand Ltd Churchman J held:8
It is appropriate that access to the pleadings not be granted, at least until after the close of pleadings date.
[24] I consider that these proceedings are at a very early stage. The first and second defendants have applied to strike out the proceedings and a decision on that application has not yet been made. In response to that application, the plaintiff has confirmed its intention to further amend the pleadings following completion of discovery.
[25] If the claim is not struck out, the defendants have applied in the alternative for further and better particulars. If these are ordered, a further amended statement of claim is likely to be pleaded. The pleadings are, therefore, far from settled.
Is redaction possible?
[26] The plaintiff proposes that access be granted on condition that the plaintiff and third defendant redact versions of the Court documents requested. The third defendant opposes this suggestion, submitting it would not be realistic or effective at this stage. The first and second defendants have not expressed a view, which may be because their memorandum was filed prior to the plaintiffs.
[27] The third defendant submits that as the case focuses on the use of allegedly confidential information, the pleadings and affidavits filed in support contain a significant amount of material addressing this issue. If redacted, the documents would not contain sufficient information to allow fair and accurate reporting and would risk the orderly and fair administration of justice.
8 Scott v ANZ Bank New Zealand Ltd [2019] NZHC 1908 at [15].
[28] I agree that, particularly when combined with the early stage of the proceeding, the possibility of strike out, and the further intended amendment of the pleadings if not, the risk of unbalanced reporting as a result of redaction is too great.
[29] I therefore proceed to consider the request for access on the basis of unredacted documents.
Confidential and commercially sensitive information
[30] The defendants submit the dispute is a private one between private parties. As such, the defendants submit they have a right to defend the proceedings without the disclosure of any more information about their private or business lives than is necessary to satisfy the principles of open justice. Documents on the court file, including the statements of claim and defence and the affidavits filed, detail private matters relating to the Mowbrays, Zuru and the Taylors and their businesses. Access and disclosure would be inconsistent with privacy interests in those matters at this stage.
[31] Furthermore, the first and second defendants submit that Mr Mowbray’s affidavit contains a range of factual assertions which are strongly disputed by the Taylors and which they have not yet had the opportunity to fully rebut or test.
[32] As stated above, the plaintiff’s case centres on the contention (denied by the defendants) that certain allegedly confidential information belonging to the plaintiff was shared in breach of confidence. The statement of claim and statements of defence (as well as other documents on the Court file) contain details of the information which the plaintiff says is confidential.
[33] One of the factors referred to in r 12 is the right to bring and defend civil proceedings without the disclosure of any more information about the private lives of individuals, or about matters that are commercially sensitive, than is necessary to satisfy the principle of open justice.9
9 Senior Courts (Access to Court Documents) Rules 2017, r 12(c).
[34] Given the pleadings are not yet settled, I consider this factor strongly supports declining access at this stage.
Court documents contain privileged information
[35] The third defendant submits that the affidavits sworn by Mr Mowbray in this proceeding contain material subject to without prejudice privilege which is protected by s 57 of the Evidence Act 2006. Rule 12(d) requires the protection of such privileged material to be considered in determining a request for access.
[36] The third defendant submits that providing access to these affidavits would cause prejudice as it would result in information being shared inconsistently with the privilege that the third defendant holds in this information. At the very least the relevant paragraphs would have to be redacted.
[37] This is a matter that could perhaps be dealt with by redaction, so I find this factor neutral in terms of the access application.
Sufficient information will shortly be in the public domain
[38] The defendants submit that there is already sufficient information regarding the proceeding in the public domain to allow fair and accurate reporting on the proceeding such that access to further Court documents is not required.
[39] At the hearing of the first and second defendants’ application for strike out or for further and better particulars, media representatives were present and there was reporting following the hearing subject to the order that there was no reporting of the details of the allegedly confidential information.
[40] A judgment will be issued determining the first and second defendants’ application which will contain sufficient information to enable reporting on the progress of the proceedings and to meet the needs of open justice at this stage.
[41] As the defendants submit, a potential outcome of that judgment is that the claims against one or both of the first and second defendants will be struck out in their entirety which is a factor against granting access to the Court file now.
[42] I agree that currently there is sufficient information in the public domain to allow fair and accurate reporting of the proceeding and that there will be a further judgment issued which may provide further information. Access to further documents is not therefore necessary at this stage.
Requirements of r 11
[43] As set above, r 11(2)(d) provides that a person applying for access to documents is to set out any conditions on the right of access that the person proposes as conditions that he or she would be prepared to meet. No such conditions have been proposed in this case.
[44] At the hearing of the strike out application I made orders preventing publication of any details of the allegedly confidential information shared in breach of confidence. If a further application is made following the close of pleadings date (or earlier if circumstances materially change), then I would expect conditions to be proposed to respond to the fact that this is a case alleging that certain confidential information has been shared in breach of confidence. In such circumstances conditions for the disclosure of documents would be expected.
Result
[45] Taking the above matters into account, I consider that it would be premature to allow access at this stage. The application for access to the documents requested is therefore denied.
Associate Judge Sussock
0
3
1