Supreme Court of WA|2008-11-14|Before: Miere J

ABSOLUTE ANALOGUE INC -v- SUNDANCE RESOURCES LTD [2008] WASC 259 (14 November 2008)

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

CITATION : ABSOLUTE ANALOGUE INC -v- SUNDANCE RESOURCES LTD [2008] WASC 259

Civil procedure - Discovery - Application for further discovery - Whether the documents sought to be discovered are relevant to any issue in the pleadings - Whether the obligation of the party giving discovery extends to it making enquiries and efforts to identify and disclose relevant documents that are not, and have never been, in its possession, custody or power - Turns on own facts

Civil procedure - Discovery - Application that defendant produce uncovered copies of discovered documents for inspection - Whether oath of party providing discovery of covered documents is conclusive that the covered parts of its discovered documents are irrelevant to any issue in question - Whether court should inspect documents - Turns on own facts - Rules of the Supreme Court 1971 (WA) O 26 r 10

1 The plaintiffs apply for further discovery of specified classes of documents and for an order that the defendant produce uncovered copies of discovered documents for inspection.

2 The second plaintiff, Mr Porter, is a geologist. The plaintiffs say that in or about February 2006 Mr Porter made an oral agreement with Mr John Corr and Mr Adam Rankine-Wilson on behalf of the defendant. The agreement was that Mr Porter would be appointed the managing director of the defendant and would have responsibility for the management of a project involving the investigation and exploitation of iron ore deposits known as the Mbalam Iron Ore project in Cameroon. The appointment was for a period of 12 months. The defendant was to pay a fee of $20,000 per month and, subject to shareholder approval, grant 30 million options to acquire an ordinary share in the defendant at the exercise price of 10 cents per option and 20 million options at an exercise price of 50 cents per option. The consideration was to be paid to Mr Porter or a company nominated by him which would provide his services to the defendant.

3 The plaintiffs say that the original agreement was varied by an oral agreement on 8 June 2006 between Mr Porter and Mr Corr on behalf of the defendant. By their varied agreement it was agreed that instead of being appointed managing director of the defendant Mr Porter was engaged by the defendant as project manager of the project and instead of granting the options agreed in February 2006 the defendant would grant, subject to shareholder approval, 20 million options exercisable at 10 cents per share and 10 million options exercisable at 20 cents per share. The plaintiffs say that it was a term of the varied agreement that the second plaintiff's engagement should be treated as having commenced upon the defendant's shareholders approving the purchase by the defendant of all of the shares in Cam Iron SA, which approval was given on 19 May 2006.

4 In September 2006 Mr Porter nominated the first plaintiff as the company which would provide his services to the defendant for the purposes of the varied agreement.

5 The defendant pleads that discussions took place between Mr Porter, Mr Corr and Mr Rankine-Wilson in February 2006 but that no agreement was reached between Mr Porter and the defendant by those discussions. The defendant pleads that discussions took place between Mr Porter and Mr Corr in June 2006 but no agreement was reached between the plaintiff and the defendant by those discussions.

6 The plaintiffs say that Mr Porter commenced to provide services in relation to the management of the project under the agreement from about February 2006. The defendant admits that Mr Porter provided services to the defendant in relation to the Mbalam project but denies that the services were provided from on or about February 2006 and denies that they were provided pursuant to the agreement alleged by the plaintiffs. The defendant says that the services were provided pursuant to an agreement between the defendant and Mr Porter that was partly oral and partly by conduct to the effect that Mr Porter would provide consultancy services to the defendant in relation to the project and the defendant would pay Mr Porter a fee of $1,000 for each day he worked on the project up to $20,000 per month for a fulltime commitment to the project.

7 The first plaintiff invoiced the defendant for services rendered by the second plaintiff under the varied agreement for the period from 21 May - 31 August 2006. The defendant admits that it received the invoice and that it paid the amounts due pursuant to the invoice but does not admit that the payment was in respect of services provided by the second plaintiff to the defendant in relation to the project.

8 The first plaintiff invoiced the defendant for services rendered by Mr Porter, allegedly pursuant to the varied agreement, for the period from 1 September - 30 November 2006. The defendant paid the amount of those invoices. However, the defendant does not admit that the payment of the invoices was in respect of services provided by Mr Porter to the defendant in relation to the project.

9 The plaintiffs plead that the first plaintiff invoiced the defendant for services rendered by Mr Porter for the months of December 2006 - May 2007 but the defendant has not paid the first plaintiff's invoices. The defendant admits that Mr Porter provided services to the defendant in relation to the project but denies that the services were provided pursuant to the alleged agreement and denies that it is liable to pay the plaintiffs for the sum claimed in the invoices. The plaintiffs claim that the defendant is indebted to the first plaintiff in the sum of $129,976.59, being the amount of the unpaid invoices.

10 The plaintiffs say that the defendant has not taken all reasonable endeavours to obtain shareholder approval of the grant of the options and claim an order that the defendant take all reasonable steps to seek the approval of its shareholders to the grant to the first plaintiff of the agreed options. Alternatively, the plaintiffs claim damages. The defendant denies that it has any obligation to issue the options or take steps to obtain the approval of its shareholders to do so and denies that the plaintiffs are entitled to any relief.

11 The plaintiffs apply for an order that the defendant file and serve an affidavit of discovery stating whether the following documents are or have been at any time been in its possession, custody or power:

Telephone records between 1 January 2006 and 31 May 2007 kept by:

(a) Mr John Corr, including but not limited to his mobile no [mobile number omitted];

(b) Mr Adam Rankine-Wilson, including but not limited to his mobile no [mobile number omitted];

(c) Mr Alec Pismiris, including but not limited to his mobile no [mobile number omitted] and

(d) Capital Investment Partners ('CIP') of telephone no [telephone number omitted].

Personal diaries, diary notes, memoranda or file notes kept or made between 1 January 2006 and 31 May 2007 by Messrs Alex Pismiris, Adam Rankine-Wilson, and John Corr relating to any meetings and telephone discussions between:

(a) any one of the above and the Second Plaintiff, and

(b) any one or more of the above

concerning the Mbalam Iron Ore Project in Cameroon and/or the provision of services by the Plaintiffs in relation to the project.

All correspondence, emails, faxes or other documents passing between the Defendant and CIP between 15 February 2006 and 31 May 2007 concerning the Mbalam Iron Ore Project in Cameroon and/or the provision of services by the Plaintiffs in relation to the project.
All invoices, receipts, cheque requisitions, payment cheques or accounts exchanged between CIP and the Defendant from 1 February 2006 pursuant to any agreement between CIP and the Defendant, including but not limited to any mandate, concerning work performed and services rendered by CIP to the Defendant on the Mbalam Iron Ore project in Cameroon.

12 The plaintiffs bring the application for further discovery pursuant to O 26 r 10 of the Rules of the Supreme Court 1971 (WA) (RSC) or alternatively the inherent jurisdiction of the court.

13 I will consider each in turn. It is convenient to start with class 3.

14 This class of documents consists of correspondence, emails, faxes or other documents passing between the defendant and Capital Investment Partners Pty Ltd (CIP) between 15 February 2006 - 31 May 2007 concerning the Mbalam project and/or the provision of services by the plaintiffs in relation to the project.

15 CIP is not referred to in the pleadings. There is evidence, and it was admitted by the defendant's counsel, that the defendant engaged CIP to act as an adviser in relation to the acquisition by the defendant of the shares in CAM Iron SA, the company by which the defendant subsequently held its interest in the Mbalam project. Mr Rankine-Wilson and Mr Pismiris were at the material times directors of CIP. There is evidence of an unsigned letter of 15 February 2006 from Mr Rankine-Wilson of CIP to the defendant. Mr Rankine-Wilson is described as the executive chairman of CIP. The letter outlines the terms and conditions on which CIP is engaged by the defendant to act as adviser in relation to the acquisition of CAM Iron. The letter says, amongst other things, that all enquiries in relation to the agreement should be directed to Mr Rankine-Wilson or Mr Pismiris. There is evidence of emails and minutes of meetings of directors of the defendant and minutes of a meeting of directors of CAM Iron SA from which it can be inferred that CIP, Mr Rankine-Wilson and Mr Pismiris were involved in a management or advisory role in relation to the project before and after the acquisition of the shares in CAM Iron SA by the defendant.

16 The defendant by its chief financial officer has sworn an affidavit verifying its list of discoverable documents and a further affidavit verifying a supplementary list of discoverable documents. The documents discovered by the defendant include communications passing between Mr Corr, CIP, Mr Rankine-Wilson and Mr Pismiris.

17 The first question is whether the documents are relevant to any issue in the action. Documents concerning the Mbalam project are not necessarily relevant to any issue in the proceedings. They are likely to include documents relating to aspects of the project which have nothing to do with the plaintiffs. However, I consider that communications between the defendant and CIP between 15 February 2006 - 31 May 2007 concerning the provision of services by the plaintiffs in relation to the project are relevant.

18 Counsel for the defendant submitted that the real issue between the parties in relation to the amounts claimed by the first plaintiff under its invoices is whether the first plaintiff was entitled to be paid a fee of $20,000 per month as alleged by the plaintiffs or a fee of $1,000 per day to a maximum of $20,000 per month as alleged by the defendant. However, in its present form the defence denies the plea by the plaintiffs that Mr Porter commenced to provide services in relation to the management of the project under the alleged agreement from about February 2006. The defendant says that it paid the plaintiffs' invoices for services rendered prior to 30 November 2006 and the plaintiffs' claim for outstanding invoices relates only to invoices for services rendered for the months of December 2006 - May 2007. Accordingly, the defendant says that there is no issue between the parties concerning the provision of services by Mr Porter or the first plaintiff prior to December 2006. I do not accept that submission. On the current pleadings there is an issue between the parties whether or not an agreement was made between them in or about February 2006 and if so what were the terms of that agreement. There is an issue between the parties whether or not the agreement was varied on 8 June 2006 and if so what were the terms of the varied agreement. There is an issue between the parties as to whether the defendant paid the first plaintiff for the provision of Mr Porter's services under the varied agreement for the period from 21 May - 31 August 2006. There is an issue on the pleadings whether or not Mr Porter provided services to the defendant from about February 2006. That is in turn relevant to the making of, and consideration for, the varied agreement.

19 An affidavit of discovery is conclusive against the parties seeking discovery except where the discovery is shown to be insufficient in one of two ways. The first is that the insufficiency appears from the pleadings, the affidavit of discovery or the documents discovered or from any other source that constitutes an admission of the existence of a discoverable document. The second way is that it appears that the party has excluded documents under a misconception of the case by the party making the affidavit and the court is practically certain that he has in his possession or power other relevant documents which ought to have been disclosed and which he would have disclosed if he had rightly conceived his case: British Association of Glass Bottle Manufacturers Ltd v Nettlefold [1912] AC 709; Mulley v Manifold [1959] HCA 23; [1959] 103 CLR 341, 343.

20 It does not appear from the pleadings, the defendant's affidavits of discovery or the documents discovered by the defendant that the defendant has omitted discoverable documents from its discovery. Neither is there evidence of any admission of the existence of a discoverable document not discovered.

21 The plaintiffs say that the defendant is obliged to discover any relevant documents that are in the hands of CIP: that is, documents that are in the physical possession of CIP. The defendant is obliged to discover documents that are or have been in its possession, custody or power. The plaintiffs' case is that documents relating to the Mbalam Iron Ore project or the provision of services by the plaintiffs in relation to the project that are in the hands of CIP are in the power of the defendant. In order for a document to be in the power of a party that party must either in fact be in possession of it or have an immediate indefeasible legal right at the time of discovery to demand possession of it from the person in whose possession it is: Lonrho Ltd v Shell Petroleum Co Ltd (No 1) [1980] 1 WLR 627; Midalco Pty Ltd v Simpson (Unreported, WASCA, Library No 6747, 5 June 1987).

22 The plaintiffs submitted that documents relating to the project that are in the physical possession of CIP are within the power of the defendant because it is likely that CIP would give the defendant access to the documents on request. I do not accept that submission. In Lonrho Ltd v Shell Petroleum Co Ltd (636), Lord Diplock said:

For the reasons already indicated Shell Mocambique's documents are not in my opinion within the 'power' of either Shell or BP within the meaning of RSC O 24. They could only be brought within their power either

(1) by their taking steps to alter the articles of association of Consolidated and procuring Consolidated through its own board of directors to take steps to alter the articles of association of Shell Mocambique, which O 24 does not require them to do; or

(2) by obtaining the voluntary consent of the board of Shell Mocambique to let them take copies of the documents. It may well be that such consent could be obtained; but Shell and BP are not required by O 24 to seek it, anymore than a natural person is obliged to ask a close relative or anyone else who is a stranger to the suit to provide him with copies of documents in the ownership and possession of that other person, however likely he might be to comply voluntarily with the request if it were made.

23 Counsel for the plaintiffs referred to Australian Independent Newspapers Ltd v John Fairfax Holdings Ltd (Unreported, FCA (Beaumont J), 22 June 1994) and Holland-Stolte Pty Ltd v Princess Theatre Holdings Pty Ltd (Unreported, VSC (Byrne J), 17 March 1993). Neither of those cases is an authority for the proposition that a document is within the power of a party where the document is in the possession of another person and that other person is likely to comply voluntarily with a request to give the party access to the document.

24 In Holland-Stolte Ltd v Princess Theatre Holdings Pty Ltd, Byrne J said:

The expression 'possession, custody or power' used in the Rules is of respectable antiquity. In the case such as the present I would, in the absence of evidence of some special agreement between consultant and client, draw a distinction between those documents in the hands of the consultant which the client may properly call for to inspect or, upon termination of the consultancy or otherwise, to retain, on the one hand; and those documents which it may, on the other. Generally speaking, in the latter class will fall those private internal documents of the consultant, such as its own time-sheets, internal memoranda, calculations, internal drafts and other documents brought into existence for its assistance in the performance of its professional duties. In the former class would fall a consultant's copy of correspondence sent or correspondence received to or from the client or with other persons on behalf of the client.

Byrne J there confirms that documents are within the power of a party if the party has an enforceable right to inspect or obtain possession or control of the document from the person who has physical possession of it.

25 There is no evidence that the defendant has failed to give discovery of documents within the class sought by the plaintiffs that are within the physical possession of CIP and which the defendant has an enforceable right to inspect or to obtain possession or control of. The court cannot be fairly certain that there are such documents which the defendant has an enforceable right to inspect or to obtain possession or control of.

26 In their chamber summons the plaintiffs also seek an order that the defendant make an affidavit of discovery stating what enquiries and searches the defendant has carried out to locate any of the documents of which the plaintiffs seek further and better discovery, including the documents in class 3. In his oral submissions counsel for the plaintiffs said that the order they seek is to require the defendant to request each of Mr Corr, Mr Rankine-Wilson, Mr Pismiris and CIP what documents they have in their possession that fall within the description of the class 3 documents - that is, correspondence, emails, faxes or other documents passing between the defendant and CIP between 15 February 2006 - 31 May 2007 concerning the Mbalam Iron Ore Project and/or the provision of services by the plaintiffs in relation to the project and that the defendant - then make an affidavit stating the enquiries that it has made to ascertain whether or not Mr Corr, Mr Rankine-Wilson, Mr Pismiris or CIP have possession of any relevant documents and if so whether those documents will be discovered by the defendant.

27 The defendant referred to the judgment of Master Sanderson in Solartech SBN BHD v Solarhart Industries Pty Ltd (Unreported, WASC (Sanderson M), Library No 970538, 22 October 1997). In Solartech there was evidence that the Johan Group, or their solicitors, had in its possession documents relevant to the matters in issue in the action. The action related to the Solarhart business. The defendant was a shelf company, incorporated in Western Australia, which was acquired by the Johan Group for the purpose of acquiring and running the Solarhart business. The defendant was a wholly owned subsidiary of the Johan Group. Sanderson M said that he was following the decision of von Doussa J in Re McGorm; Ex parte Co-operative Building Society of South Australia (1989) 20 FCR 387; (1989) 86 ALR 275. In Re McGorm von Doussa J said:

The obligation resting on a party obliged to give discovery requires that he make proper enquiries and efforts to identify and disclose all relevant documents that are not in his possession. The obligation extends to making enquiries from the person whose possession the documents now are (278).

28 von Doussa J was referring to the obligation of a party to make enquiries and efforts to identify and disclose relevant documents that the party has had, but has not now, in his possession, custody or power. His Honour did not say that a party obliged to give discovery is required to make enquiries and efforts to identify and disclose relevant documents that are not, and have never been, in his possession, custody or power.

Suffice it to say it seems to me that the obligation to give discovery involves at least requesting from a parent company documents which might be relevant to the litigation involving its subsidiary. Of course, no order directing discovery of those documents can be made. The only order that can be made is that an affidavit be filed stating that enquiries have been made to ascertain whether or not there are any relevant documents and if so whether those documents will be discovered.

30 The obligation of a person who is giving discovery does not extend to making enquiries and efforts to identify and disclose relevant documents that are not, and have never been, in his possession, custody or power. To the extent that Sanderson M might be understood to have said otherwise I do not agree. That is not to say that the court lacks power to order a party to make requests and do things reasonably necessary to obtain documents from third parties.

31 Section 23 of the Federal Court of Australia Act 1976 (Cth) confers power upon the Federal Court to direct a party to take steps to obtain access to and discover documents which are in the possession, power or control of a third party where there is a real likelihood that a party to the proceeding would be given access to the documents upon request: Sabre Corp Pty Ltd v Russ Kalvin's Hair Care Co [1993] FCA 557; (1993) 124 ALR 400, 404. The conditions for making a 'Sabre' order were stated by Edmonds J in SPI Spirits (Cyprus) Ltd v Diageo Australia Ltd [2006] FCA 931 [31] - [32]:

First, there must be a real likelihood that the party, in this case FKP and FGUP, who is to take steps to obtain access to and discover the documents which are in the possession, power or control of a third party, would be given access to the documents upon request: see Sabre at 432 - 433. This likelihood must be established by evidence: Gambro Pty Ltd v Fresenius Medical Care Australia Pty Ltd [2002] FCA 581, [8], [17] - [19] ... Second, there must be a likelihood that the documents sought are in fact in existence in the possession of the third party.

32 In my opinion the court has power to direct a party to take steps to obtain access to and discover documents which are in the possession, power or control of a third party where there is a real likelihood that the party to the proceeding would be given access to the documents upon request. RSC O 29 r 2(1), which confers upon the court power to make such orders, or give such directions to lead to the efficient and timely disposal of proceedings as it may consider just and expedient, confers power upon the court to make orders of the kind discussed. However, such power should be exercised cautiously. The obligation to give discovery does not itself require a party to take such steps. Furthermore, RSC O 26A enables a party to obtain discovery from non-parties.

33 In this case it is not appropriate to make an order of the sort discussed. First, there is no evidence that Mr Corr, Mr Rankine-Wilson, Mr Pismiris or CIP have in their possession documents within the relevant category. So far as Mr Corr, Mr Rankine-Wilson and Mr Pismiris are concerned it is pure speculation that they might have such documents in their possession. Their role in relation to the Mbalam project was in their capacity of officers of the defendant or CIP, not in their personal capacities. So far as CIP is concerned it might reasonably be inferred that it has in its possession documents passing between the defendant and CIP between 15 February 2006 - 31 May 2007 concerning the Mbalam project but such documents may or may not be relevant to any matter in issue in the proceedings. So far as documents concerning the provision of services by the plaintiffs in relation to the project are concerned it is a matter of conjecture whether there are such documents in the possession of CIP.

34 Secondly, there must be a real likelihood that the defendant would be given access to the documents in the possession of CIP upon request. This likelihood must be established by evidence. In the present case there is no such evidence.

35 Thirdly, there is nothing about the relationship between Mr Corr, Mr Rankine-Wilson, Mr Pismiris and CIP on the one hand and the defendant on the other hand that would make it appropriate to make such an order. This is not a case where it is sought to order a subsidiary to request documents held by its parent or where the party holding the documents controls the defendant or the defendant controls the party holding the documents.

36 This class of documents consists of invoices, receipts, cheque requisitions, payment cheques or accounts exchanged between CIP and the defendant from 1 February 2006 pursuant to any agreement between CIP and the defendant, including but not limited to any mandate, concerning work performed and services rendered by CIP to the defendant on the Mbalam project.

37 There is evidence that CIP was retained by the defendant as an adviser in relation to the project. The documents sought by the plaintiffs relate to the agreement between CIP and the defendant and not any agreement between the defendant and the plaintiffs or the services provided by the plaintiffs to the defendant. It cannot be inferred from the description of the class 4 documents that they are relevant to any matter in issue in the proceedings.

38 The general rule is that an affidavit of discovery is conclusive as to the possession by the party of documents relating to matters in issue in the action.

39 There are no grounds for the court being fairly certain that there are documents within the description of the class 4 documents that are in the possession, custody or power of the defendant and are relevant to any issue in the action and have not been discovered by the plaintiff.

40 The defendant is not obliged to make discovery of any class 4 documents that are in the physical possession of CIP for the same reasons that it is not obliged to give discovery of the class 3 documents in the physical possession of CIP.

41 I decline to make any order requiring the defendant to make enquiries, or to make an affidavit stating what enquiries and searches it has carried out to locate any documents within the description of the class 4 documents. There is no evidence and no grounds for inferring that Mr Corr, Mr Rankine-Wilson, Mr Pismiris or CIP have in their possession any documents within the description of the class 4 documents that are relevant to any matter in issue in the proceedings. There is no evidence that any of them are likely to give the defendant access to such documents upon request. The relationship between Mr Corr, Mr Rankine-Wilson, Mr Pismiris and CIP on the one hand and the defendant on the other is not such as to make it appropriate to make such an order.

42 This class of documents consists of personal diaries, diary notes, memoranda or file notes kept or made between 1 January 2006 - 31 May 2007 by Mr Pismiris, Mr Rankine-Wilson, and Mr Corr relating to any meetings and telephone discussions between any of them and Mr Porter or any one or more of them.

43 As I have said, the general rule is that an affidavit of discovery is conclusive as to the possession by the party of documents relating to matters in issue in the action. There is no evidence which can lead the court to be fairly certain that the defendant has in its possession, custody or power documents falling within the class 2 documents that are relevant to any issue in the action.

44 In the absence of any evidence to the contrary I would infer that personal diaries kept or made by Mr Pismiris, Mr Rankine-Wilson and Mr Corr are not in the possession, custody or power of the defendant. There is nothing from which I can infer that diary notes, memoranda or file notes made by Mr Pismiris, Mr Rankine-Wilson or Mr Corr relating to any meetings and telephone discussions between them or one of them and Mr Porter concerning the project or the provision of services by the plaintiffs in relation to the project are in the possession, custody or power of the defendant.

45 Furthermore, the court must be fairly certain that the documents, if they are in the possession, custody or power of the defendant, are relevant to matters in issue in the action. The evidence does not establish that. It is not sufficient that documents falling within that class of documents may be relevant to a matter in issue in the proceedings.

46 I decline to make any order requiring the defendant to make enquiries or to make an affidavit stating what enquiries and searches it has carried out to locate any documents in the possession of Mr Corr, Mr Rankine-Wilson, Mr Pismiris or CIP that fall within the description of the class 2 documents. There is no evidence that Mr Corr, Mr Rankine-Wilson, Mr Pismiris or CIP would give the defendant access to the relevant documents upon request. There is no evidence that Mr Corr, Mr Rankine-Wilson, Mr Pismiris or CIP have in their possession personal diaries, diary notes, memoranda or file notes relating to any meetings and telephone discussions between any one of them and Mr Porter or any one or more of them concerning the provision of services by the plaintiffs in relation to the project. I am not satisfied that such documents relating to meetings and telephone discussions between any one or more of the named persons and Mr Porter or to any one or more of the named persons concerning the Mbalam Iron Ore Project are relevant to any matter in issue in the proceedings.

47 These documents consist of telephone records kept by Mr Corr, Mr Rankine-Wilson, Mr Pismiris and CIP.

48 There is no evidence from which the court can be fairly certain that the telephone records referred to are relevant to any issue in the proceedings or that they are in the possession, custody or power of the defendant.

49 I decline to make an order that the defendant make enquiries of or make an affidavit stating what enquiries and searches it has made of Mr Corr, Mr Rankine-Wilson, Mr Pismiris and CIP to locate any documents falling within the description of the class 1 documents. There is no evidence that it is likely that Mr Corr, Mr Rankine-Wilson, Mr Pismiris or CIP would give the defendant access to the documents upon request. There is no evidence that it is likely that documents within the description of the class 1 documents are in fact in existence and in the possession of Mr Corr, Mr Rankine-Wilson, Mr Pismiris or CIP and relate to any matter in issue in the proceedings. Furthermore, the relationship between Mr Corr, Mr Rankine-Wilson, Mr Pismiris and CIP is not of itself sufficient to warrant the making of such an order.

Application for further discovery - conclusion

50 For the reasons given the application for further discovery should be dismissed.

51 The plaintiffs' solicitor has inspected the documents discovered by the defendant. Twenty-three of the documents from the defendant's discovery had parts of the document and/or the attachment to the document covered up or 'masked' from inspection (Masked Documents). The defendant has covered up parts of the documents discovered on the ground that the covered up parts are not relevant to any matter in issue.

52 It is an established principle and accepted practice that where a discoverable document contains material that is both relevant and irrelevant, the document can be produced for inspection with the irrelevant part or parts of the document sealed up or covered up in some way so that only discoverable material is disclosed. The oath of a party who has covered up parts of a document, that the uncovered parts are the only parts relevant to matters in question, or that the covered parts do not relate to matters is question, is prima facie conclusive: see GE Capital Corporate Finance Group v Bankers Trust Co [1995] 1 WLR 173, 174; Youlden Enterprises Pty Ltd v Health Solutions (WA) Pty Ltd [2005] WASC 60 [12]; Harris Scarfe Ltd (Receivers & Managers Appointed) in Liq v Ernst & Young (No 10) [2006] SASC 325 [22].

53 The court has the power to call for and inspect any discovered documents, including inspecting and comparing any uncovered and covered up version of any discovered document in order to decide a claim for relevance. The power is conferred by RSC O 26 r 10 and the inherent power of the court. Order 26 r 10 provides:

At any stage of the proceedings in any cause or matter the Court may subject to Rule 11 order any party to produce to the Court any document in his possession, custody or power, relating to any matter in question in the cause or matter and the Court may deal with the document when produced in such a manner as it thinks fit.

No order for production of any documents for inspection or to the Court shall be made unless the Court is of opinion that the order is necessary either for disposing fairly of the cause or matter or for saving costs.

54 It is not common practice for the court to engage in detailed supervision of the inspection process unless there are circumstances that warrant the court inspecting the documents - that is, the court will only inspect the documents if it thinks it is necessary as required by O 26 r 11. A party asserting that a discovered document should be discovered in its entirety and without any parts covered up will not automatically result in the court exercising its power under O 26 r 10. The question is whether the court should accept as conclusive the affidavit of the party producing the documents that the covered up portions of the documents are irrelevant to the questions in issue. If the court finds that the oath of the party is conclusive, then the court will generally refrain from exercising its power under O 26 r 10. However, the court may exercise that power if it is satisfied, not on a conflict of affidavits, but either from the documents produced or from anything in the affidavit made by the party providing discovery, or by any admission by that party in the pleadings, or necessarily from the circumstances of the case, that the affidavit does not truly state that which it ought to state: see Jones v Andrews (1888) 58 LT 601, 604; GE Capital Corporate Finance Group v Bankers Trust Co (174); Youlden Enterprises Pty Ltd v Health Solutions (WA) Pty Ltd [12]. In that instance, the court can compare the covered and uncovered versions of discovered documents in order to decide whether the covered up parts are relevant to any question in issue and if so, the court can order that those discovered documents be provided for inspection with any parts being uncovered or remaining covered up as the court sees fit.

55 Peter Damian Canterbury is the chief financial officer of the defendant. He swore an affidavit on 8 November 2007 verifying a list of documents (First List of Documents) relating to the matters in question in the action which are or have been in the possession, custody or power of the defendant. Neither the First List of Documents nor the affidavit of Mr Canterbury state or make reference that any part or parts of the documents available for inspection have been covered up. Mr Canterbury swore an affidavit on 10 June 2008 verifying a supplementary list of documents. In a letter dated 30 January 2008 the plaintiffs' solicitors wrote to the defendant's solicitors and stated that in their view the defendant's discovery is inadequate because, amongst other things, the defendant has covered up parts of documents which in the plaintiffs' opinion could not possibly attract legal professional privilege. In a letter of 5 February 2008 to the plaintiffs' solicitors the defendant's solicitors stated the basis for the covering up as follows:

Redaction or masking of material has been undertaken on the basis that it is irrelevant to the matters in issue and, accordingly, not required to be disclosed to your clients.

You should not misunderstand the reference to material being commercially sensitive or confidential. Our client has not sought to resist discovery on the basis that the material is commercially sensitive or confidential. Rather, our client has taken the point in relation to relevance because the material is commercially sensitive or confidential. Irrelevance is the ground of objection.

56 Mr Canterbury swore an affidavit on 10 July 2008 (July Affidavit) in opposition to the plaintiffs' application for production of the uncovered copies of the Masked Documents. Mr Canterbury deposes that he has been informed and advised by the defendant's solicitors concerning the issues in the proceedings and the defendant's obligation to give discovery. Mr Canterbury has inspected the original unmasked documents and has considered the masked versions of those documents. Mr Canterbury says that three of the documents of which the plaintiff seeks discovery of uncovered copies were not in fact masked or covered up at all. Those are the documents that are items 27, 36 and 147 in the defendant's list. The plaintiffs do not press their application in relation to those documents. The plaintiffs have discovered unmasked versions of the documents that are items 20, 37 and 49 in the First List of Documents. Mr Canterbury says that in those circumstances, and without conceding the merit of any part of the plaintiffs' discovery application, the defendant will no longer oppose the plaintiffs' inspection of complete and uncovered copies of those documents. Accordingly, there remain 17 Masked Documents that have been made available for inspection which the plaintiffs seek to inspect in an uncovered or unmasked form.

57 In her affidavit sworn 9 June 2008 Maha Chaar, the plaintiffs' solicitor, refers to a number of masked documents made available for inspection by the defendant and states that they are relevant to the question of Mr Porter's involvement in the Project which is in issue in these proceedings. In his July Affidavit Mr Canterbury deposes that the discovered documents covered up or masked by the defendant when they were inspected by the plaintiffs' solicitors do not relate to any matter in question in the proceedings. In [27] of his affidavit Mr Canterbury deposes:

As I have already stated in paragraph 21 above, I do not believe that any of the Masked Parts of the Defendants' Discovered Documents relate to any matter in question in the proceedings on the principles referred to in paragraph 6(a) & (b) above, including 'the question of Mr Porter's involvement in the Project' to the extent that his involvement in the Project is a question in issue.

In paragraphs 6(a) and (b) Mr Canterbury deposes that the solicitor for the defendant has told him, and he verily believes, that the court:

(a) takes a very broad view on the issue of whether any document relates to a matter in question in the proceedings for the purposes of discovery (i.e. whether the document is 'relevant' for the purposes of discovery); and

(b) will take the view that a document which is, or which has been, in the defendant's possession, custody or power will relate to a 'matter in question' in the proceedings even in circumstances where it is merely reasonable to suppose that the document contains information that may enable the plaintiffs to advance their own case or to damage the defendant's case.

58 Mr Canterbury's July Affidavit is prima facie conclusive that the masked parts of the Masked Documents are irrelevant and do not relate to any matter in question in these proceedings. The question is whether the court should accept Mr Canterbury's July Affidavit as conclusive. It is for the plaintiff to establish, not on a conflict of affidavits, but either from the Masked Documents or from something in Mr Canterbury's July Affidavit, or by any admission by the defendant in its pleadings, or necessarily from the circumstances of the case, that the July Affidavit does not truly state that which it ought to state.

59 In oral submissions counsel for the plaintiffs drew my attention to [21], [27] and [29] of the July Affidavit. I have already quoted [27], [6(a)] and [6(b)] of the July Affidavit at [57] above. Paragraphs 21 and 29 are as follows:

I am also satisfied that those parts of the rest of the defendant's discovered documents that are listed in paragraph 2 of the plaintiff's discovery application ... that were actually 'covered up' or masked by the defendant when Ms Chaar inspected those documents (the 'Masked Parts of the Defendant's Discovered Documents') do not relate to any matter in question in the proceedings on the principles referred to in paragraphs 6(a) & 6(b) above.

...

In the interests of clarity, I repeat that I do not believe that the Masked Parts of the Defendant's Discovered Documents that are referred to ... are relevant to any matter in question in these proceedings (i.e. as I have already stated in paragraph 21 above) including those portions of the documents referred to in items 20, 37 and 49 in Part 1 of the First Schedule of the Defendant's Original Discovery which were masked when they were inspected by Ms Chaar.

60 Counsel for the plaintiffs highlighted the following words from [27] of the July Affidavit: 'to the extent that [Mr Porter's] involvement in the project is a question in issue'. Counsel for the plaintiffs said that the only way to read [27] is that Mr Canterbury is saying that some of the masked parts of the Masked Documents do relate to the question of Mr Porter's involvement in the project but that those masked parts relate to the involvement of Mr Porter in a way that is not relevant to any question in issue. Counsel for the plaintiffs submitted that on the face of it the defendant's solicitors and Mr Canterbury have taken a view about the extent that Mr Porter's involvement in the project is relevant and that that has informed their decision to mask but Mr Canterbury does not state in the July Affidavit what that qualification is. Counsel for the defendant submitted that the words 'including the question of [Mr Porter's] involvement in the project to the extent that his involvement in the project is a question in issue' is a subordinate clause that recognises that there is an acute sensitivity on the part of the plaintiffs because of the emphasis they place on the pleadings in this matter. It is difficult for the court to interpret affidavits on interlocutory applications. In any event, there is no evidence that the defendant has misapprehended any question in issue. I find that there is nothing in the July Affidavit that establishes that the July Affidavit does not truly state that which it ought to state.

61 In Ms Chaar's affidavits sworn 20 May and 9 June 2008 she deposes that she verily believes that the covered up parts of the Masked Documents are relevant to the issues in these proceedings. In her 9 June 2008 affidavit, Ms Chaar also deposes that she has been informed by Mr Porter, and she verily believes, that Mr Porter believes that the covered up parts of the Masked Documents may be relevant to the issues in these proceedings. It is not clear why Mr Porter did not swear his own affidavit. In any event, deposing to a belief that the covered parts of the Masked Documents are relevant to the questions in issue is not sufficient evidence by itself to warrant the court exercising its discretion under O 26 r 10. I find that there is no evidence in either of Ms Chaar's affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue.

62 There are four documents that have been discovered by both Mr Porter and the defendant. In his affidavit dated 14 November 2007 Mr Porter verifies his list of discovered documents. In her affidavit of 9 June 2008, Ms Chaar deposes that documents 20, 27, 37 and 49 from the defendant's First List of Documents are the same as documents 100, 127, 269 and 492 from Mr Porter's list of documents. When the defendant discovered documents 20, 37 and 49 it masked parts of the documents. After comparing the masked and unmasked versions of these three documents, the plaintiffs only raise issue with part of the masking of document 37 from the defendant's discovery.

63 Document 269 from Mr Porter's discovery is an unmasked version of document 37 from the defendant's discovery. Ms Chaar has annexed a copy of document 37 to her affidavit dated 20 May 2008 and a copy of document 269 to her affidavit dated 9 June 2008. Document 37 is described in the First List of Documents as: 'Email from David Porter to Alec Pismiris: Board Minutes, Minutes of meeting of directors of Cam Iron (SA) held at the 10th Floor of the Hilton Hotel on 7 June 2006 (attachment), Time 19:02, Date 20.07.2006'. Inspection of documents 37 and 269 confirms this description. The email is a single page and does not appear to have been masked. The minutes of the board meeting is attached to the email and appears to have had several parts masked.

64 The plaintiffs submitted that comparison of the masked and unmasked version of document 37 shows that something has miscarried in the masking process undertaken by the defendant. The plaintiffs drew specific attention to [5] of the minute. Paragraph 5 consists of a short introductory sentence followed by five subparagraphs labelled (a) - (f). The introductory sentence to [5] and (a), (b) and (f) have been masked. Counsel for the plaintiffs stated that by comparing the masked and unmasked documents one can see two parts - the introductory sentence to [5] and (f) - where there is information which on its face is relevant to Mr Porter's involvement in the project but has been masked by the defendant. The defendant explained that (f) had been masked because it relates to an entirely separate project and is irrelevant. The defendant conceded that the introductory sentence to [5] is relevant but explained that, put at its highest, it is evidence of 'a minor clerical slip' as the relevant subparagraphs have been carefully identified and disclosed (ts 110 - 111).

65 I do not infer from the masking of the introductory sentence to [5] that the masking process undertaken by the defendant has miscarried. The masking process may miscarry if the party undertaking the masking of its discovered documents misapprehends any question in issue. As I have said, there is no evidence that the defendant has misapprehended any question in issue. The plaintiffs do not say how or in what way the defendant has misapprehended the case. On the face of it, the masking of the introductory sentence to [5] appears to be an error in the nature of a clerical error as was submitted by the defendant. I find that there is nothing in the masking process of document 37 from the defendant's discovery that establishes that the July Affidavit does not truly state that which it ought to state.

66 The plaintiffs submit that the covered up parts of the Masked Documents create gaps which affect the comprehensibility of the uncovered parts of the Masked Documents and the context in which those uncovered parts appear. The plaintiffs' submission relates to the issue of whether the covered up parts render the rest of the document incomprehensible or unintelligible. In CTC Resources NL v Australian Stock Exchange Ltd [2000] WASCA 19; (2000) 22 WAR 48 [68] Owen and Steytler JJ said:

We are aware that in GE Capital Corporate Finance Group v Bankers Trust Co Hoffman LJ said at 175 that a party is permitted to cover up an irrelevant party of a document provided it could do so 'without destroying the sense of the rest or making it misleading'. But as his Lordship pointed out, he was dealing with discovery, not privilege. In any event, we think that the emphasis should be on whether the partial disclosure would make what remains misleading or incorrect rather than unintelligible.

67 Although CTC Resources NL v Australian Stock Exchange Ltd concerned a claim for privilege on grounds of public interest immunity as opposed to a claim for relevance as is the defendant's claim in this case, it follows that covering up may mean that the relevant portion of a discovered document is unintelligible or not comprehensible but that may fall short of it being misleading or inaccurate. Nevertheless, if a masked document is unintelligible that may be a ground for the court exercising its power under O 26 r 10. Furthermore, if the context of a document is not discernable from its description in a list of documents deposed to by the party providing discovery or from inspection of the discovered document itself, then the list of documents may be found to be misleading or inaccurate or the document itself unintelligible, and this may be a ground for the court to exercise its power under O 26 r 10.

68 I will now review the covered versions of the Masked Documents and consider whether the masking process has rendered any Masked Document unintelligible and whether the context of the Masked Documents is discernable.

69 Document 1 is described in the First List of Documents as: 'Email from John Corr to Michael Frayne: Sundance, Time 13:35, Date 13.02.2006'. Inspection of document 1 confirms this description. The defendant does not appear to have covered any part of any sentence - that is, all of the uncovered sentences are complete sentences. There are two bullet points that do not have any accompanying information. On a fair reading of document 1 the bullet points have been left uncovered in order to help the reader understand the structure of the document and not to indicate that the information accompanying those bullet points is relevant to any question in issue. As I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue. I find that the masking process has not rendered document 1 unintelligible and that its context is discernable.

70 Document 6 is described in the First List of Documents as: 'Minutes of meeting of directors of Sundance Resources Ltd held on 27 February 2006, Date 27.02.2006'. Inspection of document 6 confirms this description. The defendant does not appear to have covered any part of any sentence - that is, all of the uncovered sentences appear to be complete sentences. There are a number of headings that do not have any accompanying information: 'Mainglade Holdings Pty Ltd', 'Capital raising', 'Issue of options', 'Chacarilla', 'Acquisition of Chacarilla', 'Fees for additional work' and 'Half-yearly report to 31 December 2005'. On a fair reading of document 6 the headings have been left uncovered in order to help the reader understand the structure of the document and not to indicate that the information accompanying those headings is relevant to any question in issue. As I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue. I find that the masking process has not rendered document 6 unintelligible and that its context is discernable.

71 Document 28 is described in the First List of Documents as: 'Minutes of meeting of directors of Sundance Resources Ltd held on 1 June 2006, Date 01.06.2006'. Inspection of document 28 confirms this description. The defendant does not appear to have covered any part of any sentence - that is, all of the uncovered sentences appear to be complete sentences. There are two headings that do not have any accompanying information: 'Issue of shares and options for corporate advisory services' and 'Issue of options to advides AG'. On a fair reading of document 28 the headings have been left uncovered in order to help the reader understand the structure of the document and not to indicate that the information accompanying those headings is relevant to any question in issue. As I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue. I find that the masking process has not rendered document 28 unintelligible and that its context is discernable.

72 Document 45 is described in the First List of Documents as: 'Minute of meeting of directors of Sundance Resources Ltd held on 22 August 2006, Date 22.8.2006'. Inspection of document 45 confirms this description. The defendant does not appear to have covered any part of any sentence - that is, all of the uncovered sentences appear to be complete sentences. There are two headings that do not have any accompanying information: 'Financial report' and 'Sundance annual report'. On a fair reading of document 45 the headings have been left uncovered in order to help the reader understand the structure of the document and not to indicate that the information accompanying those headings is relevant to any question in issue. Information appears to have been masked between the headings of 'Budget for Cameroon' and 'Financial report'; however, as I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue. I find that the masking process has not rendered document 45 unintelligible and that its context is discernable.

73 Document 48 is described in the First List of Documents as: 'Minutes of a meeting of directors of Sundance Resources Limited held 27 October 2006, Date 27.10.2006'. Inspection of document 48 confirms this description. The defendant does not appear to have covered any part of any sentence - that is, all of the uncovered sentences appear to be complete sentences. Information appears to have been masked in two places: the first between the headings of 'Release agreements' and 'Board appointments' and the second between the heading 'Purchase of D7 & campsite' and the signature of the Chairman, Mr Corr, declaring the document as a true and correct record. As I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue. I find that the masking process has not rendered document 48 unintelligible and that its context is discernable.

74 Document 51 is described in the First List of Documents as: 'Email from Don Lewis to Roger Bogne: Re Congo and forward planning, Time 15:57, Date 26.11.2006'. Inspection of document 51 confirms this description. The defendant does not appear to have covered any part of any sentence - that is, all of the uncovered sentences appear to be complete sentences. Two sections of the body of the email appear to have been masked; however, as I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue. I find that the masking process has not rendered document 51 unintelligible and that its context is discernable.

75 Document 59 is described in the First List of Documents as follows (alphabetical identifiers added to description):

Notice of meeting of directors of Sundance Resources Limited to be held on 1 December 2006
Minutes of a meeting of directors of Sundance Resources Limited held on 27 October 2006 (attachment)

Ratification of ASX announcements since last board meeting (attachment)

Sundance Resources Limited: Board appointments
Sundance Resources Limited: Allottees of placements (attachment)
Sundance Resources Limited: Notice of General Meeting (attachment)
Corporate Governance Policy (attachment)
Recommendations (attachment)
Strategic Vision and Corporate Objectives (attachment)
Organisational Plan (attachment)
Executive Appointments - Contracts (attachment)

Activities in the Cameroon: November 2006 (attachment)
Organisational chart: Cameroon (attachment)
World Bank - social contact issues (attachment)
PFS Budget 2007 (attachment)
South American assets (attachment)
Consolidated balance sheet as at 23 November 2006 (attachment)
Treasury (attachment)
Investor relations (attachment)
Key advisors and service providers (attachment)

Top 40 holders of ordinary shares (grouped) (attachment)

Sundance Resources Limited: Corporate Structure (attachment)

76 In addition to the list above there is document entitled 'Staffing/Remuneration Issues'. This page was originally masked during the plaintiffs' solicitors' inspection of the defendant's discovered documents. In his July Affidavit, Mr Canterbury states that he has compared the masked and unmasked versions of document 59 and he has identified a single page which appears to be relevant to the matters in question. Consequently, the document entitled 'Staffing/Remuneration Issues' was annexed to Mr Canterbury's July Affidavit and is available to the plaintiffs.

77 Inspection of Document 59 confirms the descriptions for (a) - (e), (h) - (x). The defendant does not appear to have covered any part of any sentence - that is, all of the uncovered sentences appear to be complete sentences. There are a number of headings, numbers and bullet points that do not have any accompanying information. On a fair reading of (a) - (e), (h) - (x) the headings, numbers and bullet points have been left uncovered in order to help the reader understand the structure of the documents and not to indicate that the information accompanying those headings, numbers or bullet points are relevant to any question in issue. As I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue. I find that the masking process has not rendered (a) - (e), (h) - (x) to document 59 unintelligible and that their context is discernable.

78 Attachments (f) and (g) to document 59 have been omitted in their entirety from document 59. Substituted in place of each attachment is a page with the words 'Attachment omitted from discovery irrelevant and commercially sensitive/confidential information'. The complete omission of (f) and (g) makes it impossible to confirm the veracity of their description in the First List of Documents. In other attachments to document 59 the defendant has discovered the entire document and masked everything except the title of the document. For example, (o) is completely masked except for a bold heading at the top of the page that reads 'Sundance Resources Limited World Bank/Social Contact Issues'. The description of (o) in the First List of Documents can be confirmed by inspection of the document itself; however, this confirmation is not possible with (f) and (g). I find that by substituting pages stating that (f) and (g) have been omitted from discovery renders those documents unintelligible as no information at all can be gained from inspection of those documents. Although a finding that a discovered document is unintelligible may be ground for the court to exercise its discretion under O 26 r 10 I will not do so. It is clear to the plaintiffs from the substituted pages that the defendant considers that the entirety of (f) and (g) are irrelevant and Mr Canterbury's July Affidavit evidences this belief. Although I find that the masking process has rendered (f) and (g) unintelligible, as I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue.

79 Document 61 is described in the First List of Documents as: ' Minute of a meeting of directors of Sundance Resources Limited held on 1 December 2006, Date 01.12.2006'. Inspection of document 61 confirms this description. The defendant does not appear to have covered any part of any sentence - that is, all of the uncovered sentences appear to be complete sentences. There are a number of headings that do not have any accompanying information: 'Chairman', 'Declaration of interests', 'Dealing in the company's shares', 'Capital raising', 'Notice of shareholder meeting', 'Corporate governance', 'Strategic direction', 'Congo', 'Social programme in Cameroon' and 'Company secretary'. On a fair reading of document 61 the headings have been left uncovered in order to help the reader understand the structure of the document and not to indicate that the information accompanying those headings is relevant to any question in issue. As I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue. I find that the masking process has not rendered document 61 unintelligible and that its context is discernable.

80 Document 64 is described in the First List of Documents as: 'Email from Alec Pismiris to David Porter: FW: DRC Companies, Time 09:36, Date 03.01.2007'. Inspection of document 64 confirms this description. The defendant does not appear to have covered any part of any sentence - that is, all of the uncovered sentences appear to be complete sentences. The email that Mr Pismiris has forwarded to Mr Porter appears to have a section masked between the information about the email (i.e. from, sent, to, subject) to the single word of 'ta'. On a fair reading of document 64 the email information and the word 'ta' have been left uncovered in order to help the reader understand the structure of the document and not to indicate that the information between them is relevant to any question in issue. As I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue. I find that the masking process has not rendered document 64 unintelligible and that its context is discernable.

81 Document 65 is described in the First List of Documents as: 'Minutes of the directors meeting of Sundance Resources Limited held on 8 January 2007, Sundance Resources Limited: Organisational Plan (attachment), Date 08.01.2007'. Inspection of document 65 confirms this description. The defendant does not appear to have covered any part of any sentence - that is, all of the uncovered sentences appear to be complete sentences. There are a number of headings that do not have any accompanying information: '2.0 Matters arising', '3.0 Continuous disclosure', '4.0 Share placement', '5.0 Corporate governance', '6.0 Strategic vision', '9.0 Congo iron ore opportunity', '11.0 Accounting, finance and administration', '12.0 Investor relations', '13.0 Key advisers and service providers' and '14.0 Risk management & insurance'. On a fair reading of document 65 the headings have been left uncovered in order to help the reader understand the structure of the document and not to indicate that the information accompanying those headings is relevant to any question in issue. As I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue. I find that the masking process has not rendered document 65 unintelligible and that its context is discernable.

82 It is convenient to deal with these two Masked Documents together as one is an email response to the other. Document 116 is described in the First List of Documents as: 'Email from David Porter to Robin Longley: Re: Exploration Programme Schedule update, Time 16:23, Date 05.03.2007'. Document 117 is described in the First List of Documents as: 'Email from Robin Longley to David Porter: Schedule, Time 16:41, Date 05.03.2007'. Inspection of documents 116 and 117 confirms these descriptions. The defendant does not appear to have covered any part of any sentence - that is, all of the uncovered sentences appear to be complete sentences. In document 116 the body of the email between the words 'Rob' and 'Regards Dave' appears to have been masked. On a fair reading of document 116 the words have been left uncovered in order to help the reader understand the structure of the document and not to indicate that the information between those lines is relevant to any question in issue. In document 117 there appears to be information masked between the email's subject line and where the body of the email starts. As I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue. I find that the masking process has not rendered documents 116 and 117 unintelligible and that their context is discernable.

83 Document 120 is described in the First List of Documents as follows (alphabetical identifiers added to description):

Notice of meeting of directors of Sundance Resources Limited to be held on 8 March 2007
Board papers coversheet (attachment)

Sundance Resources Limited: HR - organisational plan (attachment)

Inspection of document 120 confirms this description. The defendant does not appear to have covered any part of any sentence - that is, all of the uncovered sentences appear to be complete sentences. Attachments (b) and (c) to document 120 do not appear to be masked in any way. Attachment (a) is a notice of meeting that is subtitled 'Agenda' and contains a table comprising information about various agenda items. In the column labelled 'Agenda Item' each agenda item appears in a separate row in the column with the title of the agenda item in bold text with related information underneath. There are a number of agenda items that have only the title of the item and no information underneath the title: 'Continuous disclosure', 'Corporate governance', 'Strategic vision', 'Strategic development', 'Accounting, finance & administration' and 'Investor relations'. There is a column entitled 'Item No.' and in this column agenda item numbers 8 and 9 do not have any accompanying information in the 'Agenda Item' column at all. On a fair reading of document 120 the item numbering and agenda titles have been left uncovered in order to help the reader understand the structure of the document and not to indicate that the information accompanying them is relevant to any question in issue. As I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue. I find that the masking process has not rendered document 120 unintelligible and that its context is discernable.

84 Document 121 is described in the First List of Documents as: 'Minutes of the directors meeting of Sundance Resources Limited held on Thursday 8 March 2007, Date 08.03.2007'. Inspection of document 121 confirms this description. The defendant does not appear to have covered any part of any sentence - that is, all of the uncovered sentences appear to be complete sentences. There are a number of headings that do not have any accompanying information: '3.0 Continuous disclosure', '4.0 Corporate governance', '5.0 Strategic vision', '6.0 Strategic Development', '9.0', '11.0 Accounting, finance & administration', '12.0 Investor relations' and '13.0 Risk management & insurance'. On a fair reading of document 121 the headings have been left uncovered in order to help the reader understand the structure of the document and not to indicate that the information accompanying those headings is relevant to any question in issue. There also appears to be a small section masked between the heading '7.0 Mbalam Iron Ore Project' and the next visible line of text. As I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue. I find that the masking process has not rendered document 121 unintelligible and that its context is discernable.

85 Document 126 is described in the First List of Documents as: 'Email from Robin Longley to Don Lewis: Dave et al, Time 23:41, Date 18.03.2007'. Inspection of document 126 confirms this description. The defendant does not appear to have covered any part of any sentence - that is, all of the uncovered sentences appear to be complete sentences. It appears that two parts of the body of the email sent at 11.41 pm from Robin Longley to Don Lewis has been masked whilst their previous two emails to each other and the attachment to the 11.41 pm email appear to be unmasked. As I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue. I find that the masking process has not rendered document 126 unintelligible and that its context is discernable.

86 Document 135 is described in the First List of Documents as (alphabetical identifiers added to description):

Notice of meeting of directors of Sundance Resources Limited to be held on 18 April 2007
Board papers coversheet (attachment)

Minutes of the directors meeting of Sundance Resources Limited held on 8 March 2007 (attachment)

Matters arising from board meetings held on Wednesday 18 March 2007 (attachment)
Mbalam Iron Ore Project (attachment)

Inspection of document 135 confirms these descriptions. The defendant does not appear to have covered any part of any sentence - that is, all of the uncovered sentences appear to be complete sentences. Attachment (b) to document 135 does not appear to be masked in any way. Attachment (a) is a notice of meeting that is subtitled 'Agenda' and, like document 120, contains a table comprising information about various agenda items. There are a number of agenda items that have only the title of the item and no information underneath the title: 'Continuous disclosure', 'Corporate governance', 'Strategic development', 'Accounting, finance & administration' and 'Investor relations'. There are a number of headings in attachment (c) that does not have any accompanying information: '3.0 Continuous disclosure', '4.0 Corporate governance', '5.0 Strategic vision', '6.0 Strategic Development', '8.0 Congo iron ore opportunity', '11.0 Accounting, finance & administration', '12.0 Investor relations' and '13.0 Risk management & insurance'. Attachment (d) contains a table with three columns labelled 'Action', 'Responsible person' and 'Status'. In the column labelled 'Action' each row appears to have a title of the action in bold text with related information underneath. There are a number of headings in 'Action' column that does not have any accompanying information: 'Strategic vision', 'Strategic development', 'Cameroon: Strategic', 'Cameroon: Corporate' and 'Congo'. There are also two rows in the 'Action' column that appear to have been masked in their entirety. Attachment (e) has headings with a number of bullet points underneath that does not have any accompanying information: 'Cam Iron Corporate', 'Status of permitting issues' and 'Key meetings'. On a fair reading of document 135 the agenda titles in attachment (a) and the hearings and bullet points in attachments (c), (d) and (e) have been left uncovered in order to help the reader understand the structure of the document and not to indicate that the information accompanying them is relevant to any question in issue. As I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue. I find that the masking process has not rendered document 135 unintelligible and that its context is discernable.

87 Document 146 is described in the First List of Documents as: 'Minutes of the directors meeting of Sundance Resources Limited held on 21 June 2007, Date 21.06.2007'. Inspection of document 146 confirms this description. The defendant does not appear to have covered any part of any sentence - that is, all of the uncovered sentences appear to be complete sentences. There are a number of headings that do not have any accompanying information: '2.0 Matters arising'. '3.0 Continuous disclosure', 'Continuous disclosure - directors', 'ASX announcements', 'Director resolutions', 'CIP consultancy', 'Corporate governance manual', 'Strategic vision', 'Strategic development and planning', '7.0', '8.0 Mantos Grandes', '9.0 Human resources', '10.0 Accounting, finance & administration', '11.0 Investor relations' and '12.0 Other business'. On a fair reading of document 146 the headings have been left uncovered in order to help the reader understand the structure of the document and not to indicate that the information accompanying those headings is relevant to any question in issue. As I have said, I find that there is no evidence in the plaintiffs' affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue. I find that the masking process has not rendered document 146 unintelligible and that its context is discernable.

88 I am not satisfied that there is anything in the Masked Documents that establishes that the July Affidavit does not truly state that which it ought to state. On the face of it, I find that the masking process has not rendered the Masked Documents unintelligible and that the context of each of the Masked Documents is discernable with the only exceptions to this finding being (f) and (g) to document 59. Although I find that the masking process has rendered attachments (f) and (g) to document 59 unintelligible, as I have said, I find that there is no evidence in either of Ms Chaar's affidavits to support a finding that any of the covered parts of the Masked Documents contain information relevant to any question in issue.

89 The plaintiffs have offered to implement an appropriate confidentiality regime and give appropriate undertakings if provided with unmasked versions of the Masked Documents. The defendant has not accepted this offer and submit that there is no rule of the court or principle of law that a defendant can be compelled by operation of law to allow a plaintiff to inspect irrelevant material if the plaintiff proffers a confidentiality agreement. The plaintiffs submit that in exercising its discretion to order inspection of a covered up document which is alleged to be confidential, the court may have regard to whether an undertaking as to confidentiality is offered by the party seeking unrestricted access to the documents and rely upon Cazaly Iron Pty Ltd v Minister for Resources [2007] WASCA 60 [10].

90 In this case the defendant's ground for covering parts of the Masked Documents is irrelevancy, as opposed to a claim of confidentiality. It is clear from the authorities that I have cited earlier that where a discoverable document contains material that is both relevant and irrelevant, the document can be produced for inspection with the irrelevant part or parts of the document sealed up or covered up in some way so that only discoverable material is disclosed. I find that the plaintiffs' offer to give confidentiality undertakings is not a sufficient reason by itself for the court to make an order that the defendant provide uncovered copies of the Masked Documents to the plaintiffs for inspection when the ground claimed for masking is irrelevancy.

91 There may be circumstances in which it is proper for the court to inspect and compare covered and uncovered discovered documents but this is not such a case. I find that Mr Canterbury's July affidavit is conclusive as there is nothing in Mr Canterbury's July affidavit or the Masked Documents, or by any admission by the defendant in its pleadings, or necessarily from the circumstances of the case, that establishes that the July Affidavit does not truly state that which it ought to state. The plaintiffs' application that the defendant produce uncovered copies of the Masked Documents is dismissed.

Court of Australia Act 1976

ABSOLUTE ANALOGUE INC -v- SUNDANCE RESOURCES LTD [2008] WASC 259 (14 November 2008)

At a glance

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Judgment (129 paragraphs)

ABSOLUTE ANALOGUE INC -v- SUNDANCE RESOURCES LTD [2008] WASC 259 (14 November 2008)

Legislation Cited (1)

Cases Cited (4)