65 The rationale for Chancery's approach to contests over discovery was expressed by Bowen LJ in Lyell v Kennedy No 3 (1884) 27 Ch D 1 at 30 as follows:
'The true canon to be always borne in mind, is this: that you are appealing to the oath or conscience of the other side, and that you cease to appeal to his oath the moment you begin to contest his accuracy.'
66 It is on this basis that the Courts have been averse to cross examination on affidavits verifying discovery. See Fruehauf Finance v Zurich Australian Insurance Ltd (1990) 20 NSWLR 359 at 360 et seq. in which Giles J, as his Honour then was, extensively reviewed the authorities."
15 Of course, the circumstance that the plaintiff has acknowledged the need to provide three lists of documents, two of which have been since his appointment as administrator, evidences the insufficiencies of the first two lists, one of which was after his appointment as administrator. This is a matter to be weighed against the conclusiveness of the discovery thus far provided. Nevertheless, there exists a need for the defendant to establish why further discovery should be ordered.
16 Concerns about the sufficiency of the discovery provided were expressed in letters from the defendant's solicitors dated 22 February 2006 and 14 March 2006.
17 On 22 February 2006 the defendant's solicitors wrote:
"We refer to the Short Minutes of Order dated 9 November 2005.
We have received your client's further revised list of documents as required by paragraph 1 of the Short Minutes of Order. However, the list did not attach Index 1 or Index 2 in relation to the documents identified under Schedule 1 Part 1. Please provide us with a copy of Indexes 1 and 2 as a matter of urgency.
Further, please confirm that your client's discovery now includes all of the following categories of documents required by the defendant and requested in our letter dated 8 November 2005. For the avoidance of doubt, the defendant requires confirmation that all of the following discovery has been provided by the plaintiff:
1. All documents relevant to the administration of the estate of the late Ronald Firns Snr.
2. All documents relating to the transfer, sale, ownership and/or value of the property at 6 Emmett Street, Crows Nest.
3. All documents relating to the following corporations:
(a) Glass Slipper Racing Pty Ltd;
(b) Ancient Earth Pty Ltd;
(c) Pacific Ra Pty Ltd; and
(d) Cavavass Pty Ltd.
4. The records of the administration, and in particular documents created by the previous administrators Messrs Lord and Kerr; and
5. All documents in relation to Cavavass Pty Ltd (of which the plaintiff is a director and shareholder) and the Cavavass Trust, including, but not limited to, documents prepared by the liquidator.
On receipt of Index 1 and Index 2 of your client's further additional list of documents and the confirmation requested we will contact you to arrange a convenient time to inspect the documents…"
18 On 14 March 2006 the defendant's solicitors wrote:
"We refer to our letter dated 22 February 2006 to which we have not received a response.
Unless we receive a complete response from you by close of business on Friday 17 March 2006, we will apply to list this matter for directions at the first available opportunity.
Your failure to respond is prejudicing our client's ability to properly progress its defence of this matter, consider the completeness of your client's discovery, prepare its evidence and comply with court orders.
We attach a copy of our letter dated 22 February for your ease of reference…"
19 By letter dated 15 March 2006 the plaintiff's solicitors responded:
"We refer to your letter of 22 February 2006 and 14 March 2006.
We note that the plaintiff's Further Additional List of Documents was sent to you on 7 December 2006 and it was not until now that you inform us that you do not have a copy of the Index in relation to the documents referred to in Schedule 1 Part 1. We again enclose copy of the said Index to the Schedule.
As to paragraph 3 of your letter 22 February 2006 we are instructed that our client has discovered all documents in his possession including the categories of documents in points 1 to 5…"
20 Mr Dicker submitted that the Court should be satisfied by reference to the documents that have been discovered that discovery thus far is inadequate.
21 When the plaintiff was appointed administrator of the deceased's estate, the accountants previously charged with the joint responsibility as administrators were called upon to hand over documents. That they did so is evidenced by a letter from those former administrators to the plaintiff's solicitors dated 15 December 2004 and by a letter from the former administrators to the plaintiff dated 22 December 2004 which identifies the material then transferred as consisting of a bundle of correspondence, some photographs, an affidavit and twenty folders:
"(i) Bundle of correspondence plus 2 photographs.
(ii) Affidavit of Donald Rae Wright including exhibits.
(iii) Blue folder marked 'HESKIN' plus inclusions.
(iv) Blue folder marked 'FAMILY MEMBERS' plus inclusions.
(v) Blue folder marked 'CAVAVAS PTY LTD' plus inclusions.
(vi) Blue folder marked 'RDF HOLDING' plus inclusions.
(vii) Blue folder marked 'JITAL TRUST' plus inclusions.
(viii) Blue folder marked 'CORRESPONDENCE' plus inclusions.
(ix) Blue folder marked 'CORRESPONDENCE 3' plus inclusions;
(x) Blue folder marked 'SANGRO' plus inclusions.
(xi) Blue folder marked 'CREDITORS' plus inclusions.
(xii) Blue folder marked 'EMMETT STREET' plus inclusions.
(xiii) Blue folder marked 'MASTER FILE NO. 2' plus inclusions.
(xiv) Blue folder marked 'CORRESPONDENCE 2' plus inclusions.
(xv) Blue folder marked 'DOMINIC SUM' plus inclusions.
(xvi) Blue folder marked 'RUMA NAMODIA' plus inclusions.
(xvii) Blue folder marked 'ROMAR INVESTMENTS' plus inclusions.
(xviii) Blue folder marked 'VANBROOK' plus inclusions.
(xix) Blue folder marked 'CHASETOWN' plus inclusions.
(xx) Blue folder marked 'ESTATE OF RONALD DOUGLAS FIRNS - MASTER FILE' plus inclusions.
(xxi) Blue folder marked 'AJIT' plus inclusions.
(xxii) Blue folder marked 'MAPMARKERS' plus inclusions."
22 The material discovered after 22 December 2004 was the material identified in the list provided on 1 September 2005, set out at pp 51-56 in the exhibit folder, and in the list of 7 December 2005, set out at pp 63-83 of the exhibit folder.
23 Mr Dicker submitted that having regard to the amount of material handed over by the administrators in December 2004, it is apparent that the lists of documents discovered since then are incomplete. The documents described in the list on 1 September 2005 do not appear to relate to material which the former administrators had and the list on 7 December 2005 does not convey that the documents tally with the descriptions of the items delivered to the plaintiff by the former administrators either. The twenty-two items which came into the plaintiff's possession in December 2004 are not comprehensively described in the letter dated 22 December 2004 (see [21] above) but, presumably, each of the twenty-two folders contain more than one document and various names are mentioned as identifying the various blue folders (see [9] above). Documents have been produced concerning "Mapmakers", "Cavavass", "Ajit Enterprise", "Ruma Namodia" and "RDF Holdings" but there is no reference in the scheduled documents to "Heskin", "Jital Trust", "Sangro", "Roma Investments", "Vanbrook", or "Chasetown". As I understand Mr Dicker's submission, one would have expected there to be documents itemised matching those identities.
24 The next matter relied upon by Mr Dicker is that there was a meeting of creditors of the plaintiff pursuant to Part X of the Bankruptcy Act on 4 August 2005. The plaintiff's solicitors presented a claim of $400,000 for legal services provided to the plaintiff up to 4 August 2005 (see p 16 of the exhibit folder). A memorandum of fees was tabled and in that memorandum there is a claim itemised of 455 hours in relation to the perusal of documents (see p 31 of the exhibit folder). According to the file note from Ms Cridland who attended the meeting of creditors, Mr Oliveri said that he spent 455 hours looking at documents because there were 10,000 documents to consider. The content of that note is disputed. In a letter dated 22 June 2006 (exhibit folder p 113), it was denied that Mr Oliveri asserted there were 10,000 documents to consider, and that assertion was attributed to the deceased's former de facto wife.
25 Neither Ms Cridland nor Mr Oliveri has presented an affidavit in relation to the present application, and I am unable to find for present purposes that there were 10,000 documents calling for inspection by Mr Oliveri at any time prior to the creditors' meeting or, indeed, when the various lists of documents were prepared and verified. That said, however, the fees item appearing at p 31 of the exhibit makes a claim for the provision of professional services which involved the perusal of documents occupying 455 hours, and it is a reasonable inference that a very substantial volume of documents must have required consideration to account for such a lengthy period of time being taken by the plaintiff's solicitor in perusal. Thus far, the documents discovered are approximately 465 in number (although I note it is stated at p 121 of the exhibit folder that the discovered documents number 650).
26 Mr Locke, in voicing the plaintiff's resistance to the orders sought in the notice of motion, submitted that it is of fundamental importance for the plaintiff to prove that the various categories of documents concerning which the defendant seeks discovery should be relevant having regard to the issues in the cause. Mr Locke submitted that in determining whether or not there was any breach of duty by the defendant what is relevant is what occurred before the death of the testator and not after his death.
27 Whilst in determining whether there was a breach of duty it would be relevant to look to events preceding the death of the deceased, the cause would give rise to issues on causation and damage which render relevant what happened after his death, including the steps taken by the administrators. If there was a breach of duty, what was the effect upon assets of the estate as identified? I accept Mr Dicker's submission that the issues that arise in this cause are such that it is relevant to consider what happened after the death of the deceased in considering the issue of causation and damages.
28 Mr Locke further submitted that further discovery should not be ordered because of the defendant's delay. That submission requires consideration of the course of the litigation to date, and in particular the pursuit by the defendant of the discovery process. Discovery was first ordered on 30 October 2002 and the first list of documents was not provided until 19 October 2004, some two years later. That delay is prima facie to be attributable to the plaintiff, not the defendant. The history in relation to the discovery process since October 2004 is to be gleaned from the content of the exhibit folder, and the exchange of correspondence between the solicitors for the parties. I do not propose to record all the correspondence exhaustively, but I do not consider that there has been delay on the defendant's part such as should prevent an order for further discovery now being made.
29 In para 1(a) of the notice of motion the defendant seeks documents relating to the administration of the estate of the deceased. I am satisfied these documents are prima facie relevant and, accordingly, that they comprise a proper subject for discovery on the issues that arise in this cause. Further, I am persuaded by Mr Dicker's arguments that the earlier response by the plaintiff directed to discovery is incomplete.
30 In deciding on the form of the order that should now be made, I am mindful that the plaintiff consented to an order that he serve a revised verified list of documents by 7 December 2005. The required content of that revised list was earlier expressed in the letter from the defendant's solicitors to the plaintiff's solicitors dated 8 November 2005:
"We refer to tomorrow's directions hearing and attach proposed short minutes of order for the further progress of the proceedings.
We have included the order in relation to discovery on the basis that your client's additional verified list of documents is inadequate as it does not include:
(a) the records of the administration, and in particular documents created by the previous administrators Messrs Lord and Kerr; and
(b) all documents in relation to Cavavass Pty Ltd (of which the plaintiff is a director and shareholder) and the Cavavass Trust, including, but not limited to, documents prepared by the liquidator.
It has recently come to our attention that the Crows Nest property was sold to a company related to the plaintiff and that he in fact received hundreds of thousands of dollars from the sale of that property - see page 13 of the Controlling Trustee's Report to Creditors & Notice of Meeting dated 25 July 2005 and prepared by Ivor Worrell.
For the avoidance of doubt, therefore, to the extent that the defendant has not previously expressly sought discovery of these documents, the defendant requires full and proper verified discovery of the following categories of documents:
1 All documents relevant to the administration of the estate of the late Ronald Firns Snr.
2 All documents relating to the transfer, sale, ownership and/or value of the property at 6 Emmett Street, Crows Nest.
3 All documents relating to the following corporations:
(a) Glass Slipper Racing Pty Ltd;
(b) Ancient Earth Pty Ltd;
(c) Pacific Ra Pty Ltd; and
(d) Cavavass Pty Ltd."
31 In the letter from the plaintiff's solicitor dated 15 March 2006 (set out in [19] above) there was no complaint about the relevance or the width of expression of the categories of documents referred to in the letter from the defendant's solicitors dated 22 February 2006. Rather, the plaintiff's response through his solicitors was that the necessary documents had been produced.
32 I consider that the Court should now order that the plaintiff give further discovery relating to the categories referred to in para 1(a), 1(c) and 1(d)(ii) of the notice of motion. Paragraph 1(c) overlaps with para 1(d), and in fashioning the terms of the order for discovery I will take this into account.
33 In para 1(b) the defendant seeks documents in the following category:
"documents held by and legal advice given to the plaintiff by his legal advisers, listed in Annexure A to this notice of motion relating to assets of the Deceased and/or plaintiff's rights in relation to the Deceased's will dated 23 December 1997 and/or the plaintiff's rights in relation to the Cavavass Trust"
34 Annexure A identifies various firms and counsel from whom legal advice was obtained by the plaintiff in connection with the administration of his father's estate.
35 This is an issue which was addressed in letters passing between the solicitors for the defendant and the solicitors for the plaintiff. The correspondence is lengthy and I do not propose to record it here. It starts, relevantly, with a passage appearing in the letter from the defendant's solicitor to the plaintiff's solicitor dated 5 June 2006 (see in particular p 99 of the exhibit folder). There is then a letter from the defendant's solicitor to the plaintiff's solicitor dated 19 June 2006 (see p 2 of that letter at p 106 of the exhibit folder). There is then a response from the plaintiff's solicitor dated 22 June 2006 (see pp 113-114 of the exhibit folder), and, finally, there is the letter from the defendant's solicitor to the plaintiff's solicitor dated 12 July 2006, and in particular pp 118-120 as set out in the exhibit folder.
36 In short, this exchange of correspondence began with the solicitor for the defendant asserting, following a review of the affidavits served by the plaintiff, that it was apparent that the plaintiff had obtained legal advice in connection with the father's estate and sources of that advice were then identified by reference to the affidavits served. The complaint was made that some documents were served in relation to this advice, but it was evidence that there were other sources of advice in relation to which there was no discovery. Those missing sources were identified. Then, in the later letter of 19 June 2006 the failure to discover documents concerning advice was again asserted. When the plaintiff's solicitor responded on 22 June 2006 the failure to discover from the sources about which complaint had been made was sought to be explained. The final letter in the exchange, from the defendant's solicitor, effectively joined issue by asserting that the failure to discover from the sources under discussion was not satisfactorily explained because the documents were in the plaintiff's control or power.
37 It was submitted by Mr Dicker that privilege had been lost to the category of documents sought in para 1(b) of the notice of motion when regard is had to the nature of the issues that arise in this case. Mr Dicker submitted that there are issues in this cause as to the following matters: