COMPLAINTS ABOUT THE FURTHER PARTICULAR DISCOVERY
13 Arguments have ensued since provision of that list as to whether the discovery complies with the orders made by consent on 18 October 2007. Betts seeks a springing order based on Paul's' failure to comply with the orders for particular discovery. It is said that all Paul's has done is to have a director swear an affidavit 'to the best of his knowledge, information or belief'. It is said that by merely verifying the company's knowledge, information and belief without identifying who on behalf of the company held that knowledge, information and belief or what inquiries were made to reach that conclusion, no proper affidavit has been sworn. By failing to state the source of information and the grounds of belief, the affidavit, it is said, is inadmissible. Reliance is placed on Re JL Young Manufacturing Co Ltd [1900] 2 Ch 753 at 754 and Westpoint Management Pty Ltd v Goakes [2002] WASCA 317 at [14] per Wheeler J.
14 Paul's on the other hand says that the verifying affidavit complies with Form 22 of the Federal Court Rules and O 15 r 6(1). That sub-rule provides that the list of documents required by or under O 15 (the inter parties discovery order) shall, unless the Court otherwise orders, be in accordance with Form 22 and conform to the requirements of this Rule. Paragraph 5 of Form 22 has been replicated in par 5 of the second affidavit and list of discovery. No other specific order of the Court was sought or made in relation to the particular discovery.
15 It is well known that a discovery affidavit is 'conclusive' including on the question of whether a party has or has had in its possession, custody or power any relevant documents other than those discovered (Mulley v Manifold (1959) 103 CLR 341). Generally speaking there have been two narrow qualifications observed to that general position. The first qualification is that a party may seek further discovery where it appears in the face of the list already served or on the face of disclosed documents or in some other admission that in all probability the party has or has had other relevant documents beyond those disclosed in the list of discovery. A party may also seek discovery of specific documents supported by an affidavit when a prima facie case identified can be made out that the other party has or has had certain specific documents or classes of documents that relate to the matter in question.
16 Betts avoided attempting to rely upon a contentious affidavit to challenge the discovery. Rather, it is said, the second affidavit of discovery is inadmissible. Betts has not pointed to any other material which can displace the conclusive nature of the discovery affidavit and has relied upon the admissibility argument.
17 Counsel for the applicant conceded that the interesting effect of her submission if correct, would be that all discovery affidavits and lists sworn for corporations and government etc, in accordance with the Form 22 would be inadmissible. I do not consider that the further affidavit which conforms with the requirements of the Rules and which has been provided by consent on terms crafted by the applicant itself can be said to be deficient. In my view what sets affidavits of discovery (governed by O 15) apart from other interlocutory affidavits (governed by O 14) is not just that the form prescribed for a discovery affidavit sets out specific words. The distinction is that the Rules themselves together with a body of substantive law, spell out the nature of the obligations with which a deponent must comply. They include the obligation to make 'reasonable search' as provided for by O 15 r 2(3). What is a reasonable search, in turn is governed by the considerations in O 15 r 2(5). The provision of an affidavit of discovery is a very important part of the process of litigation and the nature of the search should not be treated lightly. As the cases point out, a failure to give proper discovery, especially given the reduced burden now imposed under modern rules, is likely to be visited with significant consequences.
18 In these proceedings further particular discovery was sought and the orders made for that further discovery were by consent so that the testing of whether a prima facie case had been made out did not fall for consideration, but I will assume, for present purposes that such a case was made out. Alternatively, it can be assumed that one or more of the four possible pre-conditions for the exercise of discretion under O 15 r 8 has been made out. The question then in those circumstances is whether the usual rules as to information and belief in an interlocutory affidavit, give way to specific rules specifying the manner in which a discovery affidavit is to be sworn.
19 Two things might be noted. First, there is no suggestion that the form and method of swearing an affidavit and list of documents for further particular discovery should necessarily be different from the primary or general discovery. (O 15 r 6(1) applies to O 15 generally). Secondly, for both forms of discovery there is provision for the Court to make special orders that may be adapted to the circumstances. No such orders were sought or obtained in relation to the consent minute of 18 October 2007.
20 While it might be said that giving a consent to discover documents in a particular category may suggest that some such documents exist or have existed in the possession, custody or power of the party, that may not always be so. The consent may be an acceptance that if, after further search, such documents do or have so existed, they must be discovered.
21 The applicant drew on a comparison with the obligation to inquire arising in relation to answering interrogatories: Sharpe v Smail (1975) 5 ALR 377 at 390. Again, I would agree that there is such an obligation in both circumstances to inquire. Gibbs J at 379 said:
The answer given to these interrogatories is insufficient. It does not state that proper - or indeed any - inquiries have been made and it is quite consistent with the answer given that if the defendant had made inquiries he could have obtained further information which he might have believed to be true. It is well established that a party interrogated must answer to the best of his knowledge, information and belief (unless he objects to answer) and that to use the words of Bankes LJ, in Douglas v. Morning Post Ltd (1923) 39 TLR 402 at 403, if he affirms as to one of these elements he must affirm as to all three. It is not enough to say that he has no knowledge, because he is bound also to answer according to information acquired from servants or agents who have gained it in that capacity, and where appropriate his answer must show that he has made all proper inquiries and that having made them he has no information enabling him to answer further: cf Bank of Russian Trade Ltd v. British Screen Productions Ltd [1930] 2KB 90; Ormond v. Gunnersen [1920] VLR 402.
22 Nothing in these observations assists in reaching a conclusion that swearing an affidavit of discovery, including particular discovery, in accordance with the Federal Court Rules and relevant form, renders the affidavit inadmissible or constitutes a failure to give discovery.
23 Finally, as a discretionary consideration, Betts submits that it is inherently incredible to suggest that a business of Paul's size would operate without sale software capable of tracking sales of individual lines and capable of producing a summary of the sales in relation to such lines. It is said that such a failure would constitute non-compliance with s 286 of the Corporations Act 2001 (Cth) which requires corporations to keep financial reports that record and explain its transactions, financial position and performance and which would enable its financial statements to be prepared and audited.
24 One may well expect that a company would have summaries of the nature suggested at some date after the sales. But in relation to the sales which took place in late last year, Paul's has produced the primary transactional records. The suggestion that an absence of summaries of them at the date of swearing the further affidavit of discovery was a breach of the Corporations Act was not developed in argument. There was no specific evidence on the point other than the speculation of Betts. While there would be some circumstances in which legal obligations to maintain certain records would be a relevant consideration, I am not presently persuaded this is one such situation.
25 Accordingly, the grounds for Betts' motion are not made out and the motion will be dismissed with costs.
I certify that the preceding twenty-five (25) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice McKerracher.