Crane v Insurance Australia Limited trading as NRMA Insurance

Lack of particularity and of legitimate forensic purpose 10Counsel for the defendant first submits that the terms of the subpoena are impermissibly broad and that, while the plaintiff has indicated in a general sense that production of documents the subject of any claim for legal professional privilege will not be pressed, the defendant is still asked to search for every document relevant to the claim (and all copies thereof) and to make this evaluation in relation to each document. 11Counsel for the plaintiff submits that the reference to the plaintiff's insurance claim gives the request sufficient particularity and that claims for legal professional privilege can be made in relation to any privileged document without requiring any refinement of the terms of the subpoena. 12I consider the terms of the subpoena to be impermissibly wide. The plaintiff is asking for "all" documents (as well as all "copies of documents" and electronic records), "including" (which means "not limited to") a series of general categories of documents, including witness statements. This lack of particularity cannot be remedied by a reference to the date of the plaintiff's claim on the policy. 13The principles and relevant authorities in relation to the setting aside of a subpoena where there is no legitimate forensic purpose have been helpfully summarised in ICAP Australia Pty Ltd v BGC Partners (Australia) Pty Ltd [2009] NSWCA 307 at [8] ff. In particular, at [14], Tobias JA noted that "there must be some concrete grounds for belief which takes the case beyond a mere fishing expedition". Tobias JA went on to note, at [28], the broad nature of a request for "all documents", concluding that "the unlimited manner in which it is framed" warranted its setting aside on the basis of being a "fishing expedition". 14Tobias JA's explanation of these principles has been relied upon in a number of decisions in other courts: see, for example, Azar Building and Construction Services Pty Ltd v Transport Infrastructure Development Corporation [2010] NSWLEC 110 at [20] - [21]. The drafting of a subpoena seeking every document in the opposing party's possession, whether privileged, irrelevant, a photocopy or existing in multiple copies, should not still be a procedure used by practitioners. Seeking "all documents" in this generalised fashion is not simply an attempt to obtain discovery by subpoena, but an attempt to obtain documents which, given the restrictions of discovery by reason of relevance and privilege, would not be available pursuant to a discovery order at all. Neither the opponent, nor the court, should be obliged to get out a red pencil to cross through, or read down, the terms of the subpoena to endeavour to identify what is really being sought. The only course is for such subpoenae is for them to be set aside. 15However, this is not the only basis upon which this subpoena should be set aside. The defendant submits that the real vice in the subpoena is that it is not issued for a legitimate forensic purpose, but for the purpose of enabling the plaintiff to obtain the defendant's witness statements and evidence before putting on the plaintiff's statements in accordance with the timetable. If so, the defendant submits, and I agree, that this would not be a "legitimate" forensic purpose. 16Does the subpoena serve any other legitimate forensic purpose? The test for legitimate forensic purpose for subpoenae, explained in ICAP Australia Pty Ltd v BGC Partners (Australia) Pty Ltd (see also TZ Ltd v ZMS Investments Pty Ltd & Ors; Sigalla v TZ Ltd [2010] NSWSC 138 at [13]), is that it must be "on the cards" that the documents will materially assist the issuing party's case. 17Mr Quickenden submitted that it would greatly benefit his client to know what evidence the defendant had, because he could then rely upon any evidence which did not go against him in order to corroborate his claim. However, the plaintiff's case is that he left his stalled truck overnight in the street and that some unknown person damaged it. It is not necessary for him to establish an alternative hypothesis of the case (Dimovski v GIO (1995) 21 MVR 288 at 291, citing Askarou v Nominal Defendant (NSW) (1989) 8 MVR 491; Vidal v NRMA Insurance Ltd [2005] NSWCA 390 at [15]). 18Difficult issues may arise if the issuing party has a legitimate forensic purpose in addition to a forensic purpose that is not legitimate. However, that is not the case here. As Tobias JA noted in ICAP Australia Pty Ltd v BGC Partners (Australia) Pty Ltd, the very generality of the documents sought by the plaintiff demonstrates that the plaintiff is on a "fishing expedition", looking to find out what the defendant's case is, in order to tailor his own evidence to meet it. I am accordingly satisfied that the lack of any legitimate forensic purpose would warrant the setting aside of the subpoena. 19The second basis for the setting aside of the subpoena (or alternatively a denial of access to the produced material) is on the basis of what the parties have variously referred to as "the Markus privilege" or "the Markus discretion". As is set out below, I am similarly of the view that the documents sought should not, even if the subject of a subpoena which is sufficiently particularised, and seeking documents for which there is a legitimate forensic purpose, be produced for inspection.

The Markus discretion 20A preliminary objection taken by Mr Quickenden is that the relief sought in the amended notice of motion fails to identify the Markus discretion as the basis, and that this is a fatal error warranting dismissal of the application. Applications of this kind commonly do not refer to Markus in the orders sought (see, for example, the wording of the order considered in McLennan v Insurance Australia Ltd [2011] NSWDC 132 at [2]). The basis of the defendant's objection has been clearly set out in the correspondence attached to the affidavit of Mr Bourne (Exhibit A) and the defendant's written submissions, and I accordingly reject this submission. 21The wide range of the Markus discretion, in terms of the court's power to refuse access to documents produced on discovery, affidavits or documents under subpoena, either entirely or until a certain stage of the litigation, has been explained in Halpin v Lumley General Insurance Ltd at [119] - [120]. At [119] the court noted that, while it was generally inappropriate for a court to consider that a party had acted so dishonestly that access to documents which would normally be provided should be refused, it was equally inappropriate for the court to ignore the nature of the allegations or the issues in dispute and the manner in which it was proposed to test the evidence of the party whose credit was challenged. 22The defendant submits that the material which it is sought to withhold is not of benefit to the plaintiff's case. The evidence in question goes to the basis of the defence, namely that the plaintiff was not truthful and frank and/or not acting in good faith, this being evidence of the nature that gives rise to the Markus problem: Halpin v Lumley General Insurance Ltd at [6]. The defendant submits that there is a real chance that the plaintiff, who has already failed to comply with an order to provide his statement or other liability evidence, would tailor that evidence (and his overall position) to overcome the shortfalls that would be revealed if he saw this evidence. 23Two examples of such evidence are given. The first is that a preliminary accident report challenges that the damage occurred while the vehicle was stationary. The second is that there are inconsistencies in the plaintiff's evidence revealed from interviews of witnesses. I am satisfied that this is evidence of the kind that attracts the Markus principle: Halpin v Lumley General Insurance Ltd at [119]. 24The fact that the plaintiff has failed to comply with the order to file witness statements is of significance. Had he done so, the result of this application would have been less certain. This is because some of the information the defendant does not wish to produce will be revealed in the defendant's statements in accordance with the timetable and some will become apparent if both sides retain expert evidence and serve reports. Additionally, there has never been anything to stop the plaintiff making his own inquiries at the scene of the accident. 25However, the defendant should not be obliged to hand its case on a platter to a plaintiff who, without retaining his own expert, making his own inquiries and filing his own evidence, seeks production of documents from the defendant which will give him this information out of turn so that he can tailor his own case to meet that material. 26I am comfortably satisfied that the defendant can establish a real likelihood that, by seeking this material "in advance" (Halpin v Lumley General Insurance Ltd at [36], citing Santow J in Broadwater Taxation and Investment Services Pty Ltd v Hendriks (Supreme Court of New South Wales, 9 September 1993)), the plaintiff would be enabled to tailor or endeavour to tailor his evidence, and that of his witnesses. Accordingly, I would set aside the plaintiff's subpoena on this basis as well.

Costs and further case management issues 27The defendant has been successful on all issues raised in this motion, and ordinarily costs will follow the event. However, I have reserved the issue of costs, in part because the trial judge will be in a better position to determine issues relevant to fraud, and in part because, if the plaintiff does not comply with the next orders of this court for the filing of statements (for which I have proposed a generous timetable), the defendant may wish to consider further applications, which may include the seeking of specific costs orders in relation to this application. 28The parties must enter into a timetable for the further conduct of these proceedings, including the service of statements, and should provide such a timetable to the court prior to the end of these sittings. I have included an order to this general effect.

Orders (1)Subpoena issued 8 September 2014 to the defendant in these proceedings set aside. (2)The parties to provide short minutes of order providing an extension of time for the plaintiff to serve witness statements on a date mutually convenient to the parties prior to 12 December 2014, followed by the service of statements by the defendant and such other steps as the parties may deem necessary. (3)Defendant's Amended Notice of Motion dismissed. (4)Proceedings listed before the Registrar on 19 January 2015 for directions. (5)Costs reserved. (6)Confidential affidavit of the defendant and all annexures are returned.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 11 December 2014