The applicable principles
4 Before considering the particular circumstances in which cross-examination is sought, it is convenient to set out the applicable principles. They have recently been considered by O'Loughlin J in Auspine Ltd v H S Lawrence & Sons Pty Ltd (1999) FCA 1749. I am bound to apply the principles as his Honour identified them unless I am satisfied he was plainly wrong: see Bank of Western Australia Ltd v Commissioner of Taxation (1994) 55 FCR 233 at 255. The importance of this principle (as it applies to Full Courts) was discussed and emphasised in a recent judgment of a Full Court (delivered on 22 September 2000) in Telstra Corporation Ltd v Treloar (2000) FCA 1170. Senior counsel for the Union submitted I should be satisfied that O'Loughlin J was plainly wrong.
5 In Auspine Ltd v H S Lawrence & Sons Pty Ltd the Court was considering the cross-examination of a deponent to an affidavit verifying discovery in the following context. Pursuant to an order of O'Loughlin J, the parties filed affidavits verifying lists of documents to be discovered in the proceedings. The respondents claimed that Auspine's discovery was inadequate and sought particular discovery under O 15 r 8 of the Federal Court Rules. After inspecting the applicant's discovered documents, the respondents complained, among other things, that a document which had not been discovered was referred to in a witness statement filed on Auspine's behalf.
6 The deponent to this statement, Mr McGlone, was a senior officer of Auspine and a proposed witness for the applicant. In his statement, Mr McGlone referred to a report that he had prepared. The respondents sought an order for particular discovery, by notice of motion, of the report and the documents relied on in the preparation of the report. Pursuant to orders of the Court, the applicant filed an affidavit, deposed to by Mr McGlone, which stated that the report had been destroyed (and superseded by later drafts that had been discovered by the applicant); and, in relation to the papers relied on for the preparation of the report, "[a]ll documents in relation to this category have been discovered". That is, neither the witness statement nor the affidavit identified where in the applicant's verified lists the documents had been discovered. O'Loughlin J noted at par 21 (referring to the witness statement) that:
"this was not a helpful reply … If, as Auspine claimed, the report had been discovered, it would have been a simple and cost-efficient exercise for Auspine to identify it by its number in one or other of the lists. That is to be preferred to having the requesting party, at great cost, expending much time in laboriously cross checking those thousands of entries whilst a search is made for the report."
The respondents sought leave to cross-examine Mr McGlone about the contents of the affidavit that dealt with the subject of Auspine's discovery. His Honour characterised the issue before him as follows at par 99:
"The subject matter of the dispute between the parties is the adequacy of the applicant's discovery. The respondent wishes to question that adequacy. To achieve their objective they must convince the Court that there are reasons why the Court should not treat the applicant's verified lists as conclusive."
7 His Honour refused the respondents application for leave to cross-examine Mr McGlone on his affidavit. At par 91, his Honour explained:
"At this stage, I am not in a position to reject these verified statements that have been made in the name of Auspine; I can only proceed upon the premise that I should accept Auspine's assertions and then order them to supply copies of the documents and identify where, in their lists, the documents have been discovered."
And later, at par 105:
"I confess to having had misgivings about Auspine's refusal to cooperate with the respondents by identifying where, in the verified lists of documents, the respondents might find documents that Auspine maintained that it had discovered. But on reflection, and as I consider that this litigation has been conducted to date by both sides with a determination to make the task of the other party as difficult as possible, I have concluded that Auspine's conduct is but an example of a deliberate decision not to offer aid or assistance to an opponent. I do not infer from this conduct that there has been a deliberate obstruction of the discovery process."
8 In the course of reaching various conclusions, O'Loughlin J reviewed Australian authorities on the question of cross-examination on affidavits of discovery. His Honour began by stating the general principle that "cross-examination of a deponent to an affidavit in interlocutory proceedings is an issue that falls within the discretionary power of the judge": par 96. The discretion whether to allow cross-examination is to be exercised according to the requirements of justice: Re John O'Brien; Ex parte Allchurch [1923]SASR 411 at 421.
9 His Honour then considered the authorities that deal directly with the question whether affidavits of discovery are conclusive. His Honour (par 98) distilled two propositions from Mulley v Manifold (1959) 103 CLR 341, first, contentious affidavit material does not extend the discovery process; and, secondly, with some exceptions, the normal rule is that the affidavit of discovery is conclusive.
10 In that case (at 343), Menzies J held that, in an application for further discovery under the Rules of the High Court, it cannot be shown by a contentious affidavit that the discovery made is insufficient. His Honour said:
"Before 1912, it was thought that the insufficiency had to appear from the pleadings, the affidavit of documents itself or the documents therein referred to. However, in British Association of Glass Bottle Manufacturers Ltd v Nettlefold [1912] 1 KB 369; [1912] AC 709, it was established that the insufficiency might appear not only from the documents but also from any other source that constituted an admission of the existence of a discoverable document. Furthermore, it is not necessary to infer the existence of a particular document; it is sufficient if it appears that a party has excluded documents under a misconception of the case. Beyond this, the affidavit of discovery is conclusive."
11 O'Loughlin J viewed the principles applicable in cases dealing with applications to cross-examine deponents to affidavits of discovery, which involved claims of legal professional privilege, as equally relevant to the broader subject of discovery. First, his Honour cited Giles J in Fruehauf Finance Corporation Pty Ltd v Zurich Australian Insurance Ltd (1990) 20 NSWLR 359 at 366:
"The affidavit of discovery is generally conclusive not only in relation to the amplitude of discovery but also in relation to any claim to protection from inspection of a discovered document, including a claim to legal professional privilege, and in particular cross-examination of the maker of the affidavit will not be permitted. No relevant exception to this position has been introduced by rules of court."
12 Reference was made to National Crime Authority v S (1991) 29 FCR 203 at 211, in which Lockhart J indicated that courts should not be slow to permit cross-examination of deponents to an affidavit of discovery, where there are claims of legal professional privilege and said:
"Although an affidavit in this form is usually sufficient and uncontroversial, the potential for abuse is obvious."
O'Loughlin J noted that these remarks, which were endorsed by Gummow J in Hartogen Energy Ltd v The Australian Gas Light Co (1992) 36 FCR 557, point "to some degree of relaxation in the old rule that an affidavit of discovery is usually taken to be conclusive; but I do not see it as anything more than a relaxation to some degree": par 102.
13 His Honour went on to discuss Olympic Airway SA v Spiros Alysandratos and Consolidated Travel (Victoria) Pty Ltd (unreported, Supreme Court of Victoria, 26 May 1997, Harper J), in which cross-examination on an affidavit of discovery was allowed. In that case, the plaintiff sought particular discovery from the two defendants (the first defendant was a principal shareholder of the second defendant). The documents in question had not been discovered by the defendants, although they had been relied upon by the defendants' accountants in preparing a report that included profitability forecasts. (These forecasts were alleged by the plaintiff to form part of representations made to it by the defendants when negotiating its purchase of an interest in the defendant group of companies.) The first defendant swore an affidavit denying that the documents had ever been in the second defendant's possession.
14 Harper J held that the deponent ought to be made available for cross-examination on his affidavit. His Honour stated that there are good policy reasons, in general, for not allowing cross-examination on affidavits of discovery. However, as Harper J observed, the circumstances of the case before his Honour were:
"unusual in that here there is cogent evidence to suggest the existence of documents which one would expect, if they do or did exist, were generated by one or other of the defendants. The evidence that the documents either never existed or, if they do or did exist were never in the possession of the defendants, is (it seems to me) much less cogent. If the documents do exist but are not discovered then (given their relevance to this proceeding) an injustice might be done to the plaintiff. The only procedure available to ensure that injustice is not done, and to ensure that the processes of the Court are not abused, is cross-examination."
15 O'Loughlin J also discussed Australian Securities Commission v Zarro (No 2) (1992) 34 FCR 427, a case in which Drummond J allowed cross-examination. O'Loughlin J explained this decision as follows (at par 104):
"That was a case where there has been a claim that certain documents were protected from disclosure on the ground of public interest immunity. His Honour said at 431 that he had taken what he described at [sic] 'this exceptional course' '...because of concerns at what had emerged with respect to the way the Commission had gone about claiming immunity and because of concerns at the reliability of Mr Adams' final claim to immunity for certain of the documents, in view of the change of ground, and in view of the contents of all three affidavits'."
16 O'Loughlin J considered that the general principle remains that an affidavit of discovery ought to be regarded as conclusive, subject to some exceptions. Although this rule is now less rigidly applied, it has not been abolished: par 108. His Honour's review of the authorities reveals that, where cross-examination is permitted on such affidavits, it has been in order to do justice between the parties or to prevent an abuse of the Court's processes.
17 It was submitted by senior counsel for the Union, as I understood the submission, that the correct approach was to proceed on the basis that the Court had a general discretion to determine whether it was appropriate to permit cross-examination in each case. At least implicit in this submission is that the Court should not start from the position that cross-examination should not be permitted. Senior counsel for the Union provided extensive written submissions concerning the development of the approach of courts to this question of the cross-examination of a deponent to an affidavit verifying discovery. The submissions were to the following effect.
18 The submission traced the origins of discovery procedures to the English Courts of Chancery. Senior counsel submitted that, although the Courts were limited merely to putting the defendant on oath, the modern Rules of Court that govern the discovery process and the common law allow for greater flexibility. In effect, there is nothing to preclude a Court ordering the cross-examination of a deponent on his or her affidavit of discovery.
19 At par 11 of his submissions, senior counsel relied on the similarity between O15, r 8 and its English equivalent (O 31 of the Supreme Court Rules) to suggest that the advent of the procedure of allowing discovery by lists has done away with the presumption that an affidavit verifying discovery is conclusive. He drew this conclusion from the commentary on O 31 in the English Supreme Court Practice:
"It was well established under the former O 31 in the days before discovery was given by lists, that statements in a party's affidavit of documents are conclusive - for example, on the question whether he has or has had any documents other than those disclosed."
20 The relaxation of the rule was said to have begun in Attorney-General v Emerson (1882) 10 QBD 191. In Chowood v Lyall [1929] 2 Ch 406, Clauson J cited Emerson as authority for the proposition that an affidavit verifying documents is conclusive. Senior counsel submitted:
"It is said that Emerson modified the formerly strict rule so that where the Court is reasonably satisfied upon the statement of the party from whom discovery is sought that he has erroneously represented or misconceived the nature of the documents in question a further affidavit will be directed." [par 11 of the written submissions of the applicant]
21 Senior counsel relied on the commentary to O 15, r 8 in Butterworths' Practice and Procedure: High Court and Federal Court of Australia par [40,800.5]:
"[Rule 8] enlarges the power to order discovery, enabling a party, even though his opponent's affidavit of documents may be sufficient in point of form, to make an application supported by an affidavit, for an order that his opponent shall state whether he has or has had in his possession or power any specific document or documents."
However it should be noted that the paragraph following this extract refers to the necessity for an order for a further list of documents to be filed. There is no mention of an order permitting cross-examination on an affidavit verifying the list.
22 Senior counsel then discussed Mulley v Manifold (1959) 103 CLR 341 (discussed by O'Loughlin J in Auspine), in which Menzies J:
"refers to the decision in British Association of Glass Bottle Manufacturers Ltd v Nettlefold [1912] 1 KB 369 as establishing that insufficiency of discovery might appear not only from the documents but also from any other source that constitute [sic] an admission of the existence of a discoverable document. His Honour went on:
'Furthermore, it is not necessary to infer the existence of a particular document: it is sufficient if it appears that a party has excluded documents under a misconception of the case. Beyond this, the affidavit of discovery is conclusive.'
It is of interest that Menzies J cites no English or Australian authority for the proposition of conclusiveness of a verifying affidavit but appears to have generally followed the early English practice in Chancery." [par 12 of the written submissions of the applicant]
23 It was submitted that the Federal Court Rules do not contain, in terms, specific provisions on the cross-examination of a person who verifies discovery nor is there a specific provision treating such an affidavit as conclusive.
"O 15, r 8 gives the Court power to require an affidavit to be filed dealing with specific documents or class of documents stating whether they have been in the person's possession, custody or power but if no longer in possession, custody or power when it was parted with and what has become of it and to serve the affidavit on any other party. This is a substantial advancement on the old Chancery practice and does not indicate that the Court is deprived in any way of making an order requiring the deponent to an affidavit verifying documents to be present for cross-examination." [par 13 of the written submissions of the applicant]
It was further submitted that this Court has absolute control of the process of discovery by virtue of O 15, r 8 and s 193 of the Evidence Act. Section 193(1) of that Act provides:
"Additional powers
193. (1) The powers of a court in relation to:
(a) the discovery or inspection of documents; and
(b) ordering disclosure and exchange of evidence, intended evidence, documents and reports;
extend to enabling the court to make such orders as the court thinks fit (including orders about methods of inspection, adjournments and costs) to ensure that the parties to a proceeding can adequately, and in an appropriate manner, inspect documents of the kind referred to in paragraph (b) or (c) of the definition of "document" in the Dictionary."
Therefore "it can no longer be suggested that the old Chancery practice as to the conclusiveness of an affidavit verifying documents still applies or indeed has utility. Senior counsel for the applicant cited Caltex Refining Company Pty Ltd v AMWU (1990) 51 IR 113 in support of this submission. In that case, a Full Court of this Court considered an objection to an application for discovery on the ground that the application was "all a giant fishing expedition". Burchett J observed at p 116 that such objections do not now have the weight they were once thought to have. His Honour said:
"Modern procedures actually provide as something desirable for what might once have been criticised as fishing - see O 15A of the Rules of this Court, particularly r 6. It would be ironic if the Court refused an Applicant, on this basis, discovery after action, when discovery could have been obtained, at the expense of incurring extra cost, by an application before action.
Discovery should be controlled, and may be limited to documents relevant to particular issues, but it is a valuable weapon in the armoury of justice. The real objection which, in some cases, justifies discovery being limited to particular issues is the objection of oppression."
24 Senior counsel then referred to the purpose of discovery, ie "the discovery of any document which may fairly lead to a train of inquiry which may directly or indirectly enable one party to advance its own case or damage that of its opponents": Commonwealth v Northern Land Council (1991) 30 FCR 1 at 23-24; Mulley v Manifold (1959) 103 CLR 341 at 345. This purpose is said to "[travel] well beyond the strictures of the old Chancery practice".
25 Senior counsel invited this Court to read the rules and the authorities on the general subject of discovery together with O 14 r 9(1), which provides that a party may require a person who has made an affidavit to attend for cross-examination. Senior counsel for the applicant submitted that there is no relevant limitation on this rule. He suggested that the presumption of conclusiveness of an affidavit verifying discovery is now probably an unjustified impediment to doing justice between the parties; and relied on Caltex Refining Company Pty Ltd v AMWU for this proposition.
26 Two decisions of the Supreme Court of New South Wales are cited as authority for the proposition that it is unwise for a Court to restrict its inherent power: McLean v Burns Philp Trustee Co Pty Ltd [1985] 2 NSWLR 623 at 646; Gollin Holdings Ltd v Adcock [1981] 1 NSWLR 691 at 696.
27 Dealing specifically with the question of the conclusiveness of affidavits verifying discovery, senior counsel submitted that the rule has been relaxed and that, in any event, the Courts have developed exceptions to the rule. First, the presumptive rule will be displaced:
"Where a Court is satisfied that there are reasonable grounds for being fairly certain that there are other relevant documents in the possession or power of the party which ought to have been discovered …: Beecham Group Ltd v Bristol Myers Co [1979] VR 273 at 276; British Association of Glass Bottle Manufacturers Ltd v Nettlefold [1912] 1 KB 369. A Court can be satisfied that such an affidavit cannot be relied upon because the possession of further discoverable documents or classes of documents have been sufficiently demonstrated: Wellcome Foundation Ltd v V R Laboratories (Aust) Pty Ltd (1981) 55 ALJR 249." [par 18(ii) of the written submissions of the applicant]
Secondly, in the Supreme Court of New South Wales, it has been said that there may be "special grounds to allow a party to interrogate with a view to challenging the sufficiency of the list or the affidavit: American Flange v Rheem (Aust) Pty Ltd [1965] NSWR 193 at 196." Thirdly, "the practice that an affidavit of documents is conclusive does not apply in the context of an application under O 15, r 8", citing Weir v Greening [1957] VR 296 at 298.
28 Senior counsel relied on dicta in Fruehauf Finance Corporation Pty Ltd v Zurich Australian Insurance Ltd (1990) 20 NSWLR 359. In that case, Giles J did not permit cross-examination of a deponent to an affidavit of discovery but his Honour considered this a not particularly satisfactory result. Giles J referred to the decision in Young v Quinn (1985) 59 ALR 225, in the Full Court of the Federal Court, in which Bowen CJ did not rule out the possibility of allowing cross-examination on an affidavit of a non-party claiming immunity on public interest grounds. Beaumont J indicated that he would be prepared to allow such cross-examination in an appropriate case. Sheppard J noted that it is not usually permitted but it is unclear whether he would have allowed cross-examination in an appropriate case.
29 Senior counsel pointed out that there were no submissions before Giles J either drawing to his Honour's attention authorities supporting cross-examination nor the proposition that his Honour was not precluded from allowing cross-examination because there are no rules of Court specifically prohibiting cross-examination. Giles J said at 367:
"It may be that after argument addressed to the question it could be recognised that the practice of the Court of Chancery over a hundred years ago should no longer condition a claim to privilege in an affidavit of discovery, and that the Court should adopt a different practice. The matters to which I have referred …were not the subject of argument before me, and this is not the case for considering doing so."
30 In summary, the submissions made on behalf of the Union, as I understood them, invite me to approach the matter on the basis that because the Court has absolute control over the discovery process, it should not act on a presumption that an affidavit verifying discovery is conclusive (and therefore cross-examination on that affidavit will not be permitted) in the interests of doing justice between the parties.
31 While I accept that there may be reasons of substance for the relaxation of the approach of the type taken by O'Loughlin J (and there are countervailing considerations why it should not be relaxed), I am not persuaded the approach his Honour adopted was plainly wrong. While his Honour did not refer to s 193 of the Evidence Act 1995 (Cth), that section (assuming it is intended to relate to pre-trial discovery) appears to me to do no more than confer a power on the Court that may then be exercised judicially in accordance with established principle. It is, in this respect, much the same as a section conferring a power to order costs. Accordingly I consider I should proceed on the basis that an affidavit verifying discovery or an affidavit supplementing the affidavit verifying discovery should ordinarily be treated as conclusive and cross-examination should be permitted only in order to do justice between the parties or to prevent an abuse of the Court' s processes.