British American Tobacco (Investments) Ltd v Eubanks

The positions of the persons affected

1. At this point it is useful to record the different positions adopted by the respondents in relation to the motion for expedition. In summary: 1. only Mr Waldron and Mr Pulier opposed the making of an order for expedition; 2. Mr Kelada, Mr Richardson, Mr Pennington, Ms Lane, Mr Smith, Mr Keaney and Darren Murphy, who were identified as "the CBA witnesses", neither consented nor opposed the making of an order for expedition; 3. Mr Twynham neither consented nor opposed the making of an order for expedition; and 4. Mr Nicholson, who had previously been in contact with the solicitors for the SEC by email and indicated that he consented to the examination subject to his reasonable legal costs being paid, was informed of the present application but did not appear and did not indicate his position one way or the other concerning expedition.
2. Mr Lange of counsel, who appeared for Mr Waldron, opposed the making of an order for expedition on essentially two grounds: 1. delay, which was said to disentitle the SEC to expedition; and 2. prejudice to Mr Waldron amounting to oppression because an expedited hearing would interfere with the preparation of Mr Waldron's criminal trial in the District Court of New South Wales concerning alleged offences arising out the circumstances which also give rise to the US Proceedings. That trial is presently scheduled to commence in about six weeks with an estimate that it will take 10 weeks.
3. Ms Younan of counsel, who appeared for Mr Pulier, submitted in substance that the case for expedition had not been made out but she did not join in the submission that the SEC was disentitled from a grant of expedition on the basis that somehow it had delayed its proceeding. Rather her case was put on the bases that: 1. the US District Court would be likely to grant an extension of time for the completion of discovery, including the provision of depositions from the witnesses proposed to be examined as a result of the Letters of Request, if the application under ss 32 and 33 of the Evidence on Commission Act could not be considered before the current due date for completion of discovery, 16 October 2020; 2. the US Proceedings involved a jury trial and no such trials would be conducted in criminal or civil cases in California until further notice because of the COVID-19 pandemic; 3. the request from the US District Court to this Court for expedition was qualified by whether expedition was "possible and permissible"; and 4. no special factor warranting expedition had been made out by the SEC.

Consideration

1. The principles relevant to whether expedition should be ordered were identified by Young J in Greetings Oxford Koala Hotel Pty Ltd v Oxford Square Investments Pty Ltd (1989) 18 NSWLR 33. In that case at 42-43, seven relevant factors were identified as follows: "(1) Is this the appropriate Court for the litigation, in particular: (a) does the litigation fall into the work normally done by this Court; and (b) is there a sufficient nexus with New South Wales. (2) Is there a special factor involved which warrants expedition. Usually these factors will be: (a) the loss of witnesses if the case is not fixed at an early date; (b) matters of public importance; (c) that the subject matter of the litigation will be lost if it is not heard quickly; (d) that the litigation to date has been delayed through no fault of the applicant; (e) that the applicant is suffering hardship not caused through his own fault; (f) that there is self-induced hardship (including those cases where corporate bodies fix a meeting date in the near future and then expect the Court to displace all other matters to hear their dispute before that date); (g) the nature of the case (for example, ejectment, child custody); and (h) that there are large sums of money involved. There may, of course, be other matters which can count as special factors …. (3) Have the parties proceeded up to the date of the hearing of the motion for expedition with due speed? (4) Are the parties willing if expedition is granted to do all in their power to abridge the hearing time including joining in an agreed bundle of documents, preparing statements of witnesses, filing lists of objections to affidavits, making admissions of matters not really in dispute and restraining wide-ranging cross-examination. Of course there will always be cases where one party's interests are to delay resolution of the dispute as much as possible. Such cases can usually be recognised and special procedures adopted. … (5) Any application for expedition must be judged in the light of the number of other cases of equal or higher priority that also seek an expedited hearing. (6) Any "right" to expedition is a right to have the case fixed on one occasion. If, after a date has been fixed, it has to be vacated, it is difficult indeed to justify again expediting the proceedings: Ron Hodgson Cabramatta Pty Ltd v Wewoka Pty Ltd t/as B P Cabramatta Motors (Waddell CJ in Equity, 30 March 1989, unreported). … there is a seventh guideline, namely, that the Court should not expedite a case if it considers that in all the circumstances the chances of the applicant obtaining what it seeks in the litigation cannot be put as higher than speculative."
2. While Young J stated that these considerations applied in the Equity Division, I can discern no reason why they should not equally apply in the Common Law Division.
3. There can be no doubt that this Court is the appropriate court for these proceedings given the express provision in s 32 of the Evidence on Commission Act that an application for assistance in obtaining evidence is to be made to the Supreme Court.
4. The general approach to an applications for assistance with obtaining evidence for foreign proceedings has been held by the Court of Appeal, in British American Tobacco (Investments) Ltd v Eubanks (2004) 60 NSWLR 483; [2004] NSWCA 158 at [42], to include the matters set out by Burnton J in Gredd v Arpad Busson [2003] EWHC 3001 at [27]. In relation to the present application for expedition of the hearing of the application under s 32, the following of those matters are the most relevant: 1. comity requires this Court to view a Letter of Request issued by a foreign court for the purpose of civil proceedings before it benevolently. It is our pleasure and duty to assist those courts and the parties to them in arriving at a fair and just determination of their civil litigation where we can properly do so; and 2. when an application for an order under s 32 of the Evidence on Commission Act is disputed, this Court must determine whether the order sought is one which it can or should properly make.
5. As has been noted above, in the ordinary course and without an order for expedition, it appears that the SEC's application under s 32 would be unlikely to be heard before February next year. This would lead to substantial delay, if it was determined that the application should be granted, in conducting any examinations and the provision of certified transcripts of the evidence. Viewing proceedings benevolently involves, in my view, dealing with an application for evidence to be obtained in pursuance of a request issued by a court outside New South Wales as expeditiously as possible and appropriate, having regard to all the relevant circumstances.
6. Furthermore, if, as in this case, the requesting court specifically asks this Court to proceed with expedition, where possible and permissible, this is also a matter which will usually weigh significantly in favour of the application being heard as soon as reasonably practicable.
7. In addition, I have also taken into account that there are a number of special factors which alone and in combination support a grant of expedition. These are: 1. the US Proceedings relate to alleged conduct involving persons and corporations in Australia, significant sums of money and serious breaches of US securities laws; 2. the US Proceedings are brought by a governmental regulatory body responsible for enforcing US federal securities laws; 3. the SEC's application in this Court relates directly to obtaining evidence relevant to the US Proceedings; and 4. there is the potential for the subject matter of the proceedings in this Court to be lost or rendered worthless if depositions cannot be taken from the witnesses in question before 16 October 2020, the current date by which "discovery" is to be completed, or before the trial in the US Proceedings, which is currently set to commence on 1 December 2020.
8. Although the Letters of Request were issued by the US Court on 11 May 2020, the summons in this matter was not filed until 19 August 2020. This is a delay of a little over three months. This delay was explained in some detail in the evidence of Mr Munstermann. I accept his evidence. The US Proceedings are complex. The SEC's representatives in the United States had to deal with a number of applications and preparatory steps in the US Proceedings during May, June and July which limited time and resources available to prepare for the application in this Court. In addition, Mr Miller's affidavit, which provides significant evidence in support of the SEC's application under s 32 of the Evidence on Commission Act, had to be sent to Washington DC for review and approval, which alone took approximately one month.
9. In the circumstances, I accept that there has been no significant or disentitling delay by the SEC in bringing the present application under s 32. Accordingly, I reject Mr Lange's submission that the delay, whether by itself or in combination, should lead to the application for expedition being refused.
10. It can be accepted that the US Court retains the ability to extend the time for completion of discovery beyond 16 October 2020 and may postpone the date for trial of the US Proceedings until after 1 December 2020, especially in light of the COVID-19 pandemic. As is evident from the affidavits of Ms Ford and Mr Munstermann, the parties to the US Proceedings have been in discussion concerning whether there should be an application to the US Court to extend the date for discovery or to vacate the trial date. Nonetheless, these factors do not, in my view, detract from the duty and propriety of this Court attempting, to the extent permissible and appropriate, to deal with the request from the US Court promptly. It does not appear to me that giving the present application priority by way of expedition would cause any significant delay to other matters of equal or higher priority. On this basis, I do not accept Ms Younan's submission that the facts that the time for completion of discovery in the US Proceedings might be extended or that the trial date of 1 December 2020 might be vacated mean that expedition is not appropriate or justified in the present case.
11. Mr Lange also submitted that requiring his client, Mr Waldron, to deal with the SEC's application under s 32 at a two day expedited hearing while he is preparing for his trial in the District Court of New South Wales on charges related to the conduct alleged in the US Proceedings amounted to oppression. It is accepted that Mr Waldron's trial is fixed to commence in about 6 weeks and is anticipated to last for about 10 weeks. In my view, to require Mr Waldron to prepare for and appear at a two day hearing in relation to the SEC's s 32 application during the six weeks before his trial commences is not oppressive. It is unlikely that Mr Waldron's legal representatives would need more than one week to prepare for and appear at the hearing of the SEC's application. His trial lawyers have already had considerable time in which to prepare for his District Court trial and will have approximately five more weeks until his trial, even if he does not retain additional legal representatives to deal with some or all aspects of the SEC application.
12. Apart from Mr Waldron, the witnesses proposed to be examined neither oppose nor consent to expedition. It has not been suggested by any party that they would not be available for an expedited hearing of the SEC's application or for examinations in the remainder of this year, if the application is granted. The inconvenience of potentially not having sufficient time to prepare for the examinations, raised by Ms Younan, is a matter to be considered at the hearing of the s 32 application and does not, in my view, weigh significantly against expedition being granted.
13. Finally, I observe that it does not appear to me that the SEC's application is merely speculative. It has considerable substance and deserves to be heard promptly.
14. In all the circumstances, I am satisfied that expedition should be ordered.

Costs

1. The SEC in its notice of motion sought that costs should be costs in the cause. No party sought to contend to the contrary and I consider that this is an appropriate way in which to deal with the costs of this application for expedition.

Orders

1. Accordingly, the orders of the Court are: 1. The hearing of the plaintiff's summons filed on 19 August 2020 is to be expedited. 2. The costs of the plaintiff's notice of motion filed on 26 August 2020 are to be each party's costs in the cause.

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