Bell and Berg v Macquarie Bank Limited and Another

SECOND RESPONDENT Macquarie International Capital Markets Limited PARTIES : _________________________________________

APPLICANT: Charles Joseph Berg

FIRST RESPONDENT: Macquarie Bank Limited (ACN 008 583 542)

SECOND RESPONDENT Macquarie International Capital Markets Limited FILE NUMBER: 6973 and 6974 of 1997 CORAM: Schmidt J CATCHWORDS : Practice and Procedure - motions setting aside summonses for production - question as to whether summonses are seeking discovery and are oppressive - motions dismissed LEGISLATION CITED : Evidence Act 1995 Industrial Relations Commission Rules Southern Pacific Hotel Services Inc v South Pacific Hotel Corporation Ltd (1984) 1 NSWLR 710 CASES CITED : The Commissioner for Railways v Small 1938 38 SR 564 National Employer's Mutual General Association Ltd v Waind and Hill [1978] 1 NSWIR 372 HEARING DATES: 04/03/2001 DATE OF JUDGMENT: 04/26/2001

APPLICANTS: Mr RA Dalgleish of counsel SOLICITORS: Maurice Blackburn Cashman Solicitors

LEGAL REPRESENTATIVES: RESPONDENTS: Mr IM Neil of counsel SOLICITORS: Abbott Tout Solicitors

JUDGMENT: - 13 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: Schmidt J

DATE: 26 April 2001 Matter Number IRC 6973 of 1997 MICHAEL CHARLES BELL v MACQUARIE BANK LTD & ANOR Application under section 106 of the Industrial Relations Act 1996

Matter Number IRC 6974 of 1997 CHARLES JOSEPH BERG v MACQUARIE BANK LTD & ANOR Application under section 106 of the Industrial Relations Act 1996

1 This judgment concerns notices of motion filed for the applicants and Mr Julian John Markos, of Hickson Wisewoulds solicitors, formerly retained by the applicants in these proceedings, but now engaged only to deal with the recovery of a costs order made against the respondents, which is apparently still outstanding. The respondents also sought leave to file a notice of motion in court, dealing with issues raised by the applicants' notices, as to service. In discussions between the parties, an accommodation as to that matter was reached and it is unnecessary therefore to further deal with that motion. 2 After the hearing the parties approached to advise that they were having further discussions about the other motions and asked that this judgment not be given. On 19 April, they informed that no agreement had been reached in these discussions. 3 The motions which must thus be determined seek to have set aside summonses for the production of documents issued by the respondents in the following terms: 'In this summons, (a) the word "diary" means any document, however called, being a daily or other record of events, created or kept by or on behalf of, or which refers to, the applicant;

(b) the word "document" means any record of information, and includes: (i) anything on which there is writing;

(ii) anything on which there are marks, figures, symbols, or perforations having a meaning for persons qualified to interpret them;

(iii) anything from which words, sounds, images or writings can be reproduced with or without the aid of anything else, including, without limiting the generality of the foregoing, audio or visual recordings, and any computer, magnetic or other electronic device which is or contains a record of information;

(vi) any copy, reproduction or duplicate of a document or any part of a document; and

(vii) any part of such a copy, reproduction or duplicate; and

(c) the words "the relevant period" means the period from 1 September 1994 to 30 August 1997 inclusive. These are the documents or things you must bring:

1. Any diary created in, or referring or relating to, the relevant period.

2. Any document that constitutes, records, or refers or relates to any meeting, conversation or other communication between the applicant and Charles Joseph Berg or both of them on the one hand, and any officer, employee or agent of the first or second respondent on the other hand during the relevant period, including, without limiting the generality of the foregoing, any such meeting, conversation or communication extracted in whole or in part or referred to in the summons, or any affidavit filed on behalf of the applicant, in these proceedings.

3. Any document that the applicant created or received in the course of, or for the purposes of, any contracts or arrangements that are the subject of these proceedings, including, without limiting the generality of the foregoing, any such document that was created or received in the course of, or for the purposes of, any work that was, or was to be, performed by the applicant under or pursuant to any such contract or arrangements.

4. Any document that records or refers to any contract or arrangement of any kind whereby the applicant, whether in his own right, or as the member, officer, employee or agent of any firm, corporation or other legal entity, performed, or was to perform, work of any kind on or after 30 December 1997.' 4 The documents in point one above were not sought in the summons issued to Mr Markos. The definition of document in the summons apparently reflects the definition of that term in the Evidence Act 1995. 5 The recipients of the summonses made a number of complaints about them, including that they are, in reality, seeking discovery, that they are so wide as to require production of documents which are not relevant to matters in issue in the proceedings, and that they are oppressive. The motions were supported by an affidavit of Ms Sally Kuster, a solicitor employed by Messrs Maurice Blackburn Cashman, the solicitors now retained by the applicants for the purpose of these proceedings and an affidavit of David Fishchl, another solicitor at Hickson Wisewoulds, which confirmed that that firm no longer had conduct of the proceedings. Apart from referring to Ms Kuster's affidavit, nothing was put by Mr Fishchl as to any difficulty in complying with the summons. 6 The affidavits make it evident that the conduct money tendered with the summonses was inadequate. The parties have also discussed this matter and have reached an accommodation in relation to it. It is unnecessary therefore to consider it further here. 7 Ms Kuster's affidavit also makes it apparent that the summonses will require the applicants' solicitors to peruse about 15 lever arch volumes of documents, computer records and audio tapes, in order to identify the documents which have been summonsed. A search of audio tapes is apparently necessary because the applicants taped some conversations which they had with other people. In addition, the applicants will themselves have to search their records. In one case such records are stored on three continents and in another on two. Such documents, once located, will have to be sent to Australia. There is no evidence what practical difficulties, if any, this might give rise to, other than as to the searches having to be conducted in that location. Mr Markos will also have to conduct a search. There is no evidence as to what this might involve. 8 The summonses were issued in circumstances where Marks J had earlier in the proceedings made directions as to the process of discovery between the parties, they each having issued notices to produce. These directions were somewhat overtaken by events, to put it neutrally, when other proceedings were pursued by the parties. The applicants later pursued discovery, but the respondents did not. The notices were not in evidence, but unsurprisingly it seems that there was some overlap between what was sought in the earlier notices and what is sought in the summonses complained of. What the differences were was not explored. 9 The applicants complained that the respondents had not pursued discovery. The Court, however, has no power to require the respondents do so. What the respondents cannot do, of course, is seek discovery by the summonses which have been issued. So much was conceded for the respondents, but Mr Neil of counsel argued that it was not discovery which was sought. 10 The law in relation to these types of issues is well settled. Its application in particular cases can, however, give rise to difficulty. 11 Discovery is a process designed to give the parties access to documents which are relevant to the facts in issue in the proceedings. Under Part 22 of the Commission's Rules, it is a process which has been limited. Like the Supreme Court Rules, this Court's Rules do not make provision for general discovery. 12 Discovery requires the identification of particular classes of documents, in addition to any documents referred to in the initiating process (See Rule 161). It is a process which proceeds inter parties and requires the party giving discovery to form a view as to whether or not documents in its custody and control are relevant to an issue in the proceedings. This was discussed by Clarke J in Southern Pacific Hotel Services Inc v South Pacific Hotel Corporation Ltd (1984) 1 NSWLR 710 at 717: 'A party who is called upon to provide discovery is obliged to discover all documents which are, or have been, in his possession relating to the issues joined between the litigants, in the sense, as the passage from Halsbury's Laws of England , 4th ed, vol 13, par 38 at 34, quoted by Waddell J in Spencer Motors Pty Ltd v L & C Industries Ltd [1982] 2 NSWLR 921 at 929, makes clear, that they contain information which may, not which must, either directly or indirectly enable the party requiring the discovery either to advance his own case or to damage the case of his adversary or which may fairly lead to a train of inquiry which may have either of these two consequences.

13 A summons for production on the other hand, requires that the documents specified, which are within the custody and control of the person to whom the summons is directed, be produced to the Court, which then deals with issues of access and confidentiality, if they are raised. Summonses may be issued to the parties in the proceedings, or to strangers to the litigation. The documents which are summonsed must have a relationship to the proceedings, so that for example, while they may not be relevant to an issue in the proceedings, they must have some legitimate forensic purpose, such as pursuing a proper course in cross examination. It is in that sense that the purpose of the summons must be to have relevant evidence produced. 14 One of the differences between a notice of discovery and a summons, is that a summons must identify the documents to be produced with reasonable particularity. If not, the summons will be set aside. A description of a document in general terms, is not however, necessarily a proper basis for having a summons set aside, as improperly seeking discovery. The use of descriptions such as 'referring to' or 'relating to', will not necessarily be improper, unless the result of the use of such descriptions is to require the recipient of the summons to assess the relevance of the documents sought to issues which lie between the parties in the proceedings. It is that obligation, if it arises under the summons, which gives rise to impermissible discovery, by way of a summons. 15 Summonses may thus require the production of documents which 'relate to' or 'refer to' a particular fact or subject matter, if the production required is not oppressive and is reasonably necessary in the proceedings. An obligation to exercise judgment as to whether a document relates to or refers to a particular subject matter, does not give rise to a need to assess the relevance of documents to issues in the proceedings. (For a helpful discussion of this distinction see Southern Pacific Hotel at 718 to 719.) 16 It is not necessary, however, that it be intended to tender the documents produced in response to a summons as evidence in the proceedings. However, if an unduly onerous obligation is imposed upon a person to collect and produce documents which can have little or no relevance to the proceedings, it will be set aside. 17 The well known authorities in this area illustrate these points. In The Commissioner for Railways v Small 1938 38 SR 564, a summons was issued to a third party, which required the production, amongst other things, of 'all documents, papers, reports and correspondence relating directly or indirectly to this action'. Jordan CJ held that a stranger to the litigation, not being liable to give discovery, should not be required to 'search for and produce all such documents as he may have in his possession or power relating to a particular subject matter.' To require this would be to effectively require discovery. 18 As to parties to litigation, it was the view of Jordan CJ that it was not legitimate to use a subpoena duces tecum as an application for discovery. His Honour said at pp574-575: 'Discovery applications should be made at the proper time and place. It would greatly impede the trial of actions at nisi prius, and impose an intolerable burden upon the presiding judge, if he were required from time to time to suspend proceedings and wade for himself through masses of documents for the purpose of endeavouring to determine whether any of them are relevant. Especially is this so when the documents may be called for whilst the case is still at the stage when it is difficult or perhaps impossible for the Judge to know what may become relevant and what may not In the absence of special circumstances, e.g. Griebart v. Morris [1920] 1 K.B. 659, a party is not more entitled to use a subpoena duces tecum than he is a summons for interrogatories, for the purpose of "fishing," i.e., endeavouring, not to obtain evidence to support his case, but discover whether he has a case at all : Hennessy v. Wright 24 Q.B.D. 445 at 448, or to discover the nature of the other side's evidence: Griebart v. Morriss [1920] 1 K.B. 659 at 666. Even if the documents are specified, a subpoena to a party will be set aside as abusive if great numbers of documents are called for and it appears that they are to sufficiently relevant: Steele v Savory [1891] W.N. 195.'

19 The summons was set aside as an abuse of process. 20 In National Employer's Mutual General Association Ltd v Waind and Hill [1978] 1 NSWIR 372, the Court of Appeal was considering a subpoena issued to an insurer of all of its documents in relation to Mr Waind's claim in a common law action against a Mr Hill. Moffitt P, (with whom Hutley and Glass JJA agreed), in discussing Small's case, agreed that 'it was an abuse to use any subpoena, i.e. even to a party to obtain discovery'. He went on to say at p382 that: 'It does not follow, however, that because the party who issues a subpoena is unaware of the precise description of a particular document, or whether a particular document or documents is in the possession of the witness or even whether it exists, or is unaware of its contents, that the subpoena, or even a subpoena in general terms, amounts to the use of the subpoena for the purpose of "discovery". To state it does involve a misconception of the different functions of discovery and of a subpoena for production. Of course, it may be that the terms of a subpoena are so wide that it is oppressive, but this is not because it is used for "discovery" in the sense used in Small's case and Burchard's case, but because it imposes onerous task on a stranger to collect and produce documents many which can have no relevance to the litigation. To require the branch of a bank to produce all cheques received by it in a particular year in order to find, if it exists, a cheque of the opponent in a false name would be oppressive, whereas, to require a hospital to produce its file in respect of the medical treatment of the opposing party would not. It is a misuse of terms to say the person who inspects the later is using it for the purposes of discovery, because he is unaware of the contents of the documents or some of them. It is not in point to seek to define the excessive use of the subpoena. The documents in this case are not such, and the witness itself does not so claim.'

21 It is also useful to refer to some further observations of Clarke J in Southern Pacific Hotel at 720 to 721: 'In determining whether the subpoena offends, the court will, as I have said, need to consider all the circumstances. Quite apart from the terms of the subpoena are the identity of the recipient and his connection with either the parties or the matters in issue, the extent of the burden which may be apparent from the subpoena itself or from evidence adduced for this purpose, and the possible relevance between the documents called for and the dispute before the court. The approach I would advocate conforms, I believe, with that taken in the recent authorities to which I have referred and also with that of Cantor J in R v Barton [1981] 2 NSWLR 414 at 419, 420. Discussion took place before me as to the words "referring to" in the subpoena served by the corporate plaintiff and whether those words were more restrictive than the phrase "relating to". Some support for this distinction was sought to be gained from what Lord Denning said in Re Westinghouse Electric Corporation [1977] 3 WLR 430 at 437, 438; [1977] 3 All ER 703 at 709, 710. In particular, time was spent discussing which for the meanings accorded to "refer" in the Oxford English Dictionary was appropriate. No doubt the word should be given a meaning but I do not regard it as particularly helpful to consult the dictionary and determine which of meanings of the word is appropriate in the context of the particular subpoena with which I am concerned. I have been at pains in this judgment to point out that court procedures are designed to bring about, as far a possible, an efficient and expeditions resolutions of disputes between parties. They are essentially practical matters. The subpoena, which is an important part of the process, requires a person, quite often a lay person, to bring to court documents which may be specified in particular or general terms. The recipient is not and should not be required to consult a dictionary and then carry out an exercise in construction of the document before embarking upon the collection of the documents. The court, in determining whether a subpoena is oppressive, is concerned with whether in all the circumstance the demand is, for relevant purposes, too wide or uncertain. For this purpose it must determine whether the terms of the subpoena convey to the recipient in relatively clear language the document or class of document called for. The court would inquire, I apprehend, as to the meaning which would be conveyed to members of the public as opposed to the meanings which might be conveyed to lawyers engaged in a debate upon construction. It seems to me that, in the context of the subpoena with which I am presently concerned, the recipient would not be concerned with fine distinctions between "relating to" and "referring to" and would read them as broadly calling for the same range of documents. In this respect I agree with the approach of Waddell J in Spencer Motors at 930, and I distinguish the present context from that in which Lord Denning introduced the words "referred to therein" in the Westinghouse case. '

22 I turn then to the documents here called for. They fall into two classes. The first is documents relating to the period of the employments and the second to the work performed by the applicants after the termination of their employment, in respect of which issues of mitigation arise. 23 Having considered the submissions of the parties, I can see no basis upon which the production of diaries, as defined, can be set aside. That production does not amount to discovery - it requires no consideration of the issues in the proceedings or whether the diaries are relevant to them. 24 Nor can I see that the production of the documents created or received by the applicants in the course of, or for the purpose of the contract and arrangements here in question, requires impermissible discovery. Again, it does not require a consideration of the issues in the case, but whether the documents fit the description. 25 It is undoubted that when any documents are summonsed, a careful search for them must be made. Where documents are described in general terms, this will be more onerous, than when they are described with more particularity. Having been summoned in such general terms, the proper costs which flow from the search required by the summons will have to be born by the party who issued the summons. Here, that much is the subject of agreed arrangements between the parties. 26 Given the nature of the former relationship between these parties and the cases here advanced by the applicants, which go to various aspects of the work performed by the applicants for the respondents under the contracts and arrangements in question, it is not surprising that documents which relate to those contracts or arrangements and the work performed under them might be relevant to the issues which here arise. On the material before me, it cannot be concluded that the documents here summonsed are likely to have little or no relevance to the proceedings, or that questions of the relevance of the documents so produced might impede the hearing of this application. 27 I have also not been convinced on the evidence, that the production of such documents would be oppressive. Given the apparent location of the documents however, arrangements as to the time when production may fairly be required will have to be made. This is particularly so now, given the time which has elapsed during which the parties pursued their discussions. That is a matter for the parties to discuss and if necessary for the Court to consider further. 28 As to documents which record, refer to, or relate to, meetings, conversations and communications between the applicants and officers, employees and agents of the respondents during the employment, it must again be concluded that the production does not amount to an impermissible request for discovery. Again, this part of the summons does not require a consideration of the issues in the case, in order to answer the summons, but whether the documents fit the description. 29 Some of these conversations are referred to in the summons and the affidavits filed by the applicants. There are issues between the parties as to whether such conversations took place and what was said between various people. Apparently, the applicants have made tape recordings of some of these conversations. Given the nature of the claims here advanced by the applicants, it cannot be concluded that such documents are likely to have little or no relevance to the proceedings, nor can I conclude that their production would be oppressive. 30 As to the possibility that the summonses might catch documents provided to the applicants by the respondents in the course of these proceedings, it seems to me that this does not make the summons oppressive. What it rather calls for is a sensible arrangement between the parties as to the production of such documents, particularly having in mind questions as to costs. 31 As to the production of documents which record or refer to contracts or arrangements as to work performed after 30 December 1997, it is apparent that both paid and unpaid work is caught in the summons. It is also apparent that, contrary to the submissions for the applicant, documents such as those which belong to the applicants' later employers, and which are thus not within the applicants' control, are not caught by the summons. Should the respondents wish to have such documents produced to the Court, which they say they do not, it would require another summons to be issued, directed to such employers. It cannot be concluded that the documents which are summonsed in this respect are not relevant to the proceedings. Nor can I conclude on what is before me that the summonses impermissibly seek discovery as to this matter, or that this production is oppressive. 32 At the end of the day the purpose of processes such as the issuing of a summons and discovery and production is to ensure that the relevant evidence is put before the Court at the hearing, so that justice can be done between the parties to the litigation. Here, questions of access and confidentiality in relation to any documents produced have been raised by the applicants. Those too are matters which the parties should discuss, especially as the respondents have indicated a willingness to agree upon suitable undertakings as to confidentiality. The Court will rule upon such matters if they cannot be agreed. 33 For all of these reasons I dismiss the motions. The costs of the motions will be reserved to be dealt with in the proceedings proper. ------------------------

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