3 The claims made by the plaintiff in these proceedings are outlined in my decision in Bedshed Franchising Pty Ltd v Battersby.[1]

5 The Victorian proceedings are between the plaintiff in this action, Bedshed Franchising Pty Ltd, and GNC Investments Pty Ltd (GNC). The third defendant in these proceedings, Geoffrey Cooper, is a director of, and shareholder in, GNC. The Victorian proceedings relate to a franchise agreement between GNC and Bedshed Franchising dated 22 September 2010 concerning a Bedshed store located in Chadstone, Victoria. In those proceedings, Bedshed Franchising seeks a declaration that it validly terminated GNC's franchise agreement for the Chadstone business on the ground that GNC was fraudulent in connection with that business. It alleges that GNC was fraudulent by colluding with the supplier and other franchisees to not pay marketing rebates on supplies of imported products, and by concealing such supplies from Bedshed Franchising.

6 GNC contends that Bedshed Franchising, by its general manager, Mr Culmsee, made representations during meetings in 2012 that marketing rebates were not payable on supplies to franchisees of imported products which were 'trial products'. It says that supplies on which marketing rebates were not paid by it were of trial products.

7 Whether Mr Culmsee made the representations alleged by GNC is therefore a central factual issue in the Victorian proceedings. GNC intends to call Mr Cooper and the first defendant, Mr David Battersby, to give evidence supporting GNC's case as to what occurred at the relevant meetings.

8 The plaintiff seeks leave to use documents produced on subpoena for the purpose of crossexamining Mr Cooper and Mr David Battersby as to their credibility in the Victorian proceedings.

9 Bank account statements for accounts in the name of Mr Craig Battersby and Hullavoo reveal that:

(a) between 13 October 2014 and 29 January 2015, GNC deposited funds totalling almost $500,000 into an account in the name of Mr Craig Battersby;

(b) on the same day as, or within two or three days of, each deposit, there was a corresponding transfer from Mr Craig Battersby's account to another account in his name, and then from that latter account there was a corresponding transfer to an account in the name of Hullavoo; and

(c) the funds transferred to Hullavoo were part of the funds used by it to set up its business in the Beds n Dreams store in Osborne Park and to pay expenses of that business.[2]

10 Most of the deposits by GNC have the description 'Cooper loan' on the relevant bank statement.

11 Other documents produced on subpoena indicate that Mr David Battersby was a signatory to bank accounts in the name of Hullavoo, and had authority to operate both accounts and internet banking access to one of them.[3]

12 Other subpoenaed documents show that between 27 August 2014 and 22 May 2015 Bridlewood Adelaide Pty Ltd (Bridlewood) deposited a total of about $475,000 to one of Mr Craig Battersby's accounts, with most of those deposits being recorded as 'trust distributions'.[4]

13 The plaintiff also points to account statements for accounts in the name of Hullavoo and Mrs Diane Battersby to show that credit cards in the name of Mrs Battersby were used to make payments to creditors on behalf of Hullavoo.[5]

14 Where one party to litigation is compelled, by reason of a rule or specific order of the court or otherwise, to disclose documents or information, the party obtaining the disclosure cannot, without the leave of the court, use the documents or information for any purpose other than that for which they are given, unless they are received into evidence. This principle applies to a range of material, including discovered documents, answers to interrogatories and documents produced on subpoena.[6]

15 Traditionally, the obligation not to disclose has been described as an implied undertaking. Properly understood, however, it is an obligation of substantive law.[7]

16 Discovery is an invasion of the privacy and confidentiality of a litigant's affairs. The rationale for the imposition of the obligation in relation to discovered documents is to ensure that privacy and confidentiality are not invaded more than is necessary for the purpose of doing justice.[8]

17 The same rationale applies with equal force in the context of the production of documents on subpoena, as this is also an invasion of the privacy and confidentiality of the affairs of the subpoena recipient.[9]

18 The power to dispense with or modify the implied undertaking is not freely exercised, but will be exercised if there are special circumstances which make it just to do so.[10]

19 The implied undertaking should be modified or released only to the extent that it is in the interests of the administration of justice or in the public interest to do so.[11]

20 In a passage in Liberty Funding Pty Ltd v Phoenix Capital Ltd[12] that has been cited with approval many times,[13] the Full Court of the Federal Court said as follows:

The notion of 'special circumstances' does not require that some extraordinary factors must bear on the question before the discretion will be exercised. It is sufficient to say that, in all the circumstances, good reason must be shown why, contrary to the usual position, documents produced or information obtained in one piece of litigation should be used for the advantage of a party in another piece of litigation or for other nonlitigious purposes. The discretion is a broad one and all the circumstances of the case must be examined.

21 Among the considerations that may be relevant to the exercise of the discretion are:

(b) the circumstances under which the document came into existence;

(c) the attitude of the author of the document and any prejudice the author may sustain;

(d) whether the document existed before the litigation, or was created for that purpose and therefore expected to enter the public domain;

(e) the nature of the information in the document, in particular whether it contains personal data or commercially sensitive information;

(f) the circumstances in which the document came into the hands of the applicant; and

(g) the likely contribution of the document to achieving justice in another proceeding.[14]

22 The last of these considerations has been recognised as being the most important.[15] There is a public interest in ensuring that all relevant material is before a court to enable it to discharge its function. It has been said that special circumstances will fairly be found where it is established that the use of documents discovered in proceedings is reasonably required for the purpose of doing justice between the parties in other proceedings.[16]

23 In the context of documents produced on discovery, it has been observed that, in weighing up the competing public interests, the importance of the public interest in the preservation of the confidentiality of discovered documents must be kept squarely in mind.[17] Similarly, in this case the private and public interest in protecting the confidentiality of a person's private documents produced under compulsion to a court must be kept in mind.[18]

24 Use of documents produced or discovered in one proceeding to impugn the credibility of a witness in other proceedings may, depending on the circumstances, sustain the release of the implied undertaking.[19]

25 In applying for a release of the implied undertaking it is necessary, as a first step, to identify the documents in respect of which the release is sought. That involves more than identifying categories of documents. The next step is to identify the purpose for which the documents are said to be required.[20]

26 As the plaintiff accepts, the issues in the Victorian proceedings are entirely distinct from the issues in these proceedings. Further, the plaintiff accepts that the documents produced on the subpoenas are not themselves relevant to the issues in the Victorian proceedings. The plaintiff submits, in essence, that:

(a) the trial judge's assessment of the credibility of the parties' witnesses in the Victorian proceedings is likely to be centrally important to their determination;

(b) the subpoenaed documents are likely to be highly relevant to the credibility of Mr Cooper and Mr David Battersby in the Victorian proceedings, and for that reason are likely to be significant in achieving justice between the parties in those proceedings.

27 I accept that it is reasonable to expect that the credibility of the witnesses in the Victorian proceedings is likely to be highly material to the determination of those proceedings. To my mind, however, the real question is the extent of the likely contribution of the subpoenaed documents to the assessment of the credibility of Mr Cooper and Mr David Battersby as witnesses in the Victorian proceedings.

28 In the end, the question is essentially whether there is a sufficient basis to expect that the documents produced on subpoena will bear in a significant way on the Supreme Court of Victoria's assessment of the credibility of Mr Cooper or Mr David Battersby to justify the release or modification of the implied undertaking, notwithstanding the public and private interest in protecting the confidentiality of private bank documents produced to this court under compulsion.

29 The plaintiff has not persuaded me that there is a sufficient basis to expect that the subpoenaed documents will be significant to the Victorian court's assessment of the credibility of Mr Cooper and Mr David Battersby to justify a departure from the general rule that the documents should not be used for any purpose beyond this litigation. I am not satisfied that use of the subpoenaed documents is reasonably required for the purposes of doing justice in the Victorian proceedings.

30 In explaining those conclusions, I begin by reference to the documents, referred to in [9], proposed to be used to impugn Mr Cooper's credibility. The plaintiff proposes to use those documents to impugn Mr Cooper's credibility by reference to his affidavit sworn in these proceedings, and read in the interlocutory injunction application, to the effect that he is not involved in any capacity in any Beds n Dreams store.[21] In my view, the bank account records produced on subpoena do not establish a firm platform to impugn Mr Cooper's credibility in the Victorian proceedings by reference to his affidavit sworn in these proceedings.

31 The bank records contain evidence of payments by GNC to Mr Craig Battersby. They include a description of many of those payments as 'Cooper loan'. That material does not directly falsify Mr Cooper's evidence in his affidavit that he does not have any interest in a Beds n Dreams store. What is recorded in the bank statements may well give rise to questions as to whether he has any interest in a Beds n Dreams store and, consequently, as to whether his sworn denial in his affidavit that he does not is false or misleadingly incomplete. Those questions will, no doubt, be explored in these proceedings. Whether after their exploration in crossexamination in the Victorian proceedings there would be any significant damage to Mr Cooper's credibility is highly speculative.

32 In my view, Bedshed Franchising has not demonstrated that the relevant subpoenaed documents are sufficiently likely to impugn Mr Cooper's credibility in the Victorian proceedings to sustain a release of the obligation not to use them for any purpose apart from these proceedings.

33 The plaintiff also points to the statement by Mr David Battersby in his affidavit in these proceedings that he has no interest as a lender to, or guarantor of, Hullavoo.[22] Nothing in the bank account statements or other subpoenaed documents annexed to Ms Retallack's affidavit is inconsistent with that statement. In support of an assertion of inconsistency, the plaintiff points[23] to an email sent by the defendants' solicitor on 17 July 2015 in which it is asserted that the deposits by GNC to Craig Battersby were a shortterm personal loan by Geoff Cooper to David Battersby. From that assertion, the plaintiff invites the inference that Mr David Battersby must therefore have directed the payment of the deposited funds into Hullavoo's account. Accordingly, it says that it should be further inferred that, contrary to his sworn statement, Mr David Battersby lent funds to Hullavoo.

34 The plaintiff also points to Mr David Battersby's evidence that, as far as he was aware, his son obtained finance to establish Hullavoo's Beds n Dreams business in Osborne Park from only two sources. The first was payments from loan accounts of beneficiaries of the Bridlewood Trading Trust. The second was the proceeds of the sale of Mr Craig Battersby's residential property in Adelaide.[24] Again, the plaintiff relies on the inference based on the email from the defendants' solicitor to allege an inconsistency between Mr David Battersby's testimony in this respect and the subpoenaed documents.[25]

35 In my view, in circumstances where the only foundation for the alleged inconsistencies is the email sent by the defendants' solicitor, and where counsel for the plaintiff frankly acknowledged before me that he did not know whether counsel in the Victorian proceedings had any intention of pursuing crossexamination of Mr David Battersby in this way,[26] these matters provide an inadequate foundation to sustain a release of the obligation not to use the subpoenaed documents for purposes beyond these proceedings.

36 The plaintiff also points to evidence in some of the subpoenaed documents to the effect that Mr David Battersby was a signatory to Hullavoo accounts and had internet banking access to one of them. Counsel for the plaintiff submits that those facts invite the question: why would Mr David Battersby be a signatory of or have access to a Hullavoo account if he did not have any interest in the business of Hullavoo?[27] While I do not doubt that such a question may arise, and is likely to be explored in these proceedings, I am not satisfied that there is a sufficient prospect that the primary facts revealed by the relevant subpoenaed documents will give rise to any substantial damage to the credibility of Mr David Battersby in the Victorian proceedings to sustain a release from the implied undertaking.

37 The deposits by Bridlewood into Mr Craig Battersby's account are not inconsistent to any significant degree with the affidavit of Mr David Battersby in these proceedings. The only point of departure is that he described monies paid by Bridlewood to Craig Battersby as being done on beneficiaries' loan accounts, whereas the bank statements mostly contain the description 'trust distribution'.

38 Finally, the plaintiff also points to account statements for accounts in the name of Hullavoo and Mrs Diane Battersby showing that Westpac credit cards in the name of Mrs Battersby have been used to make payments to creditors of Hullavoo, and that she has then been reimbursed by Hullavoo. Mrs Battersby is not a witness in the Victorian proceedings. Nothing in the relevant account statements is inconsistent with the affidavit of Mr David Battersby. In these circumstances, I am not satisfied that the material referred to by the plaintiff provides any ground to release it from its obligation in respect of the subpoenaed documents.

[1] Bedshed Franchising Pty Ltd v Battersby [2015] WASC 224 [14] [21].

[2] Affidavit of Lisa Maree Retallack, Annexures LMR 6, 7, 8, 9, 11, 12, 13.

[3] Affidavit of Lisa Maree Retallack, Annexures LMR 4, 5, 15A.

[4] Affidavit of Lisa Maree Retallack, Annexure LMR 12.

[5] Affidavit of Lisa Maree Retallack, Annexures LMR 13, 14, 18, 19.

[6] Hearne v Street [2008] HCA 36; (2008) 235 CLR 125 [96] (Hayne, Heydon & Crennan JJ).

[8] Hearne v Street [107]; Minister for Education v Bailey [2000] WASCA 377; (2000) 23 WAR 149 [25] [27] (Steytler J, Parker J agreeing).

[9] Ambridge Investments Pty Ltd (in liq) v Baker (No 3) [2010] VSC 545 [28] [30] (Vickery J).

[10] Esso Australia Resources Ltd v Plowman [1995] HCA 19; (1995) 183 CLR 10, 37 (Brennan J); Hearne v Street [107].

[11] Springfield Nominees Pty Ltd v Bridgelands Securities Ltd [1992] FCA 472; (1992) 38 FCR 217, 225 (Wilcox J); North East Equity Pty Ltd v Goldenwest Equities Pty Ltd [2008] WASC 190 [40] (Newnes J).

[12] Liberty Funding Pty Ltd v Phoenix Capital Ltd [2005] FCAFC 3; (2005) 218 ALR 283 [31] (Branson, Sundberg & Allsop JJ).

[13] North East Equity [41]; Andrew Koh Nominees Pty Ltd v Pacific Corporation Ltd [No 2] [2009] WASC 207 [16]; Platinum Systems Resourcing Pty Ltd v NRW Holdings Ltd [No 3] [2013] WASC 402 [15] (Le Miere J); Hua Wang Bank Berhad v Federal Commissioner of Taxation (No 8) [2013] FCA 1021 [3] (Perram J).

[14] Springfield Nominees (225); Hua Wang Bank [3]; BCI Finances Pty Ltd (in liq) v Federal Commissioner of Taxation [2015] FCA 679 [69] (Jagot J).

[16] Australian Trade Commission v McMahon (1997) 73 FCR 211, 217 (Lehane J); Bailey [24]; BCI Finances [69].

[17] North East Equity [45]; Andrew Koh Nominees [18].

[20] Ambridge Investments [39], [43]; Visy Board v D'Souza (No 3) [2008] VSC 572 [24] (Forrest J).

[21] Affidavit of Geoffrey John Cooper sworn 25 May 2015 [33.14].

[22] Affidavit of David Paul Battersby sworn 25 May 2015 [39], [42].

[23] Plaintiff's submissions dated 21 July 2015 [12], [14].

[24] Affidavit of David Paul Battersby [40].