Cook v Pasminco Ltd

REASONS FOR JUDGMENT (No 3) 1 In this matter I delivered reasons for judgment on 12 May 2000 ([2000] FCA 677) for dismissing the application as incompetent for lack of jurisdiction in the Court to entertain it. On 12 December 2000 I delivered reasons for judgment ([2000] FCA 1819) for ordering the applicants' solicitors, Coleman & Greig, to pay the respondents' costs of the proceeding on an indemnity basis, except the respondents' costs of their motion seeking that order. I ordered the solicitors to pay the respondents' costs of that motion on the usual party and party basis. 2 I will not repeat what I said in either of the earlier judgments and will take them as read. To the extent of their relevance, they constitute part of my reasons for the order made below. 3 The orders previously made left outstanding the question of the costs of a motion brought by the applicants by notice of motion filed on 1 August 2000 for an order setting aside a subpoena for production issued on the application of the respondents. That subpoena was issued on 13 July 2000 and was addressed to Paul G. Gambin of Coleman & Greig. In paragraph 40 of the reasons for judgment of 12 December 2000 I dealt with that subpoena. I noted there the motion to set aside the subpoena and the fact that the position had been resolved between the parties as to all documents referred to in the subpoena except a costs agreement entered into by the solicitors with the first applicant. The only matter that occupied hearing time was a resisted claim of legal professional privilege in respect of that agreement. In the event, I granted counsel for Pasminco access to the costs agreement, except certain parts of it which conveyed legal advice, and dismissed the motion to set aside the subpoena while reserving the costs of that motion. 4 Who should pay the costs of the motion to set aside the subpoena? In so far the motion sought a setting aside of the subpoena, it was misconceived. What was sought to be established was that the document should not be made available for inspection, not that it should not be produced to the Court. It is fundamental that in such a case the subpoena must be obeyed, that is, the document must be produced to the Court, after which argument can take place as to whether it is or is not the subject of the privilege. Of course a motion can be brought for the setting aside of a subpoena, but not on the ground of privilege. 5 On the issue of costs, counsel both for the applicants and for Coleman & Greig, submitted as follows: "1. The motion to set aside the subpoena for production clearly raised issues in relation to the discovery of documents including questions of privilege. 2. These issues would be raised and ventilated in the hearing in any event. 3. The motion in no practical way added to the costs of the proceeding for either party but did have the advantage of focusing on the issues. 4. Most of the issues were found or conceded in the Applicants' favour. The only issue won by the Respondents was the partial disclosure of the costs agreement. 5. The appropriate order in relation to costs of this motion is that each party pay its own costs." 6 The submission seems to be that I should treat the argument on the applicants' motion to set aside simply as having formed part of the hearing of the respondents' motion seeking the order for indemnity costs against the solicitors. In substance, I agree, although I note that that approach does not accord with the result actually contended for by the applicants. They submit that each party should bear its own costs. If I were to treat the argument as to privilege as having been part of the general hearing of the motion for the order for indemnity costs against the solicitors, the result would be that the costs of that argument would be governed by the order made on 12 December 2000 that the solicitors pay the respondents' costs on the usual party and party basis. 7 It is true that on the hearing on 16 October 2000 I did not grant access to certain provisions of the costs agreement. It is also true that there was a resolution as to all other documents referred to in the subpoena. But the applicants' argument did not distinguish between the various provisions of the costs agreement. I did. Moreover, the respondents succeeded in obtaining access to virtually the whole of the costs agreement. That is, the claim of privilege failed in relation to nearly the whole of it. 8 Whether I treat the argument on the applicants' motion to set aside as distinct or simply as forming an indistinguishable part of the hearing on 16 October 2000, the solicitors should pay the respondents' costs of the applicants' motion to set aside the subpoena on the usual party and party basis.