There is an endorsement in Ex DW25 to indicate that the symbol "N/R" means "No record".
Mr Brookfield has submitted that it was incorrect of Mr Wilsdon to state that there was "No record" in respect of warranty replacement pumps for the 1989 and 1990 financial years. He pointed to the information contained in Ex DW28. The two account books contain hand written entries divided into four columns. The first column shows the date, the second column the name of the customer who returned a pump, the third column gave particulars of the pump model and the fourth column contained a series of figures which presumably represented some form of code or identification that was used by Davey Products. Exhibit DW28 shows that in that two year period in excess of forty Doc 3 or Doc 7 pumps were returned to Davey Products. Mr Brookfield complained, correctly in my view, that it is therefore self evident that it was incorrect to present DW25 in the manner in which it was presented. Although it did not contain any information pointing to the reasons for returns and replacements, it still was a record of pumps that had been returned in those two years.
EXHIBIT DW27
Mr Brookfield's next complaint centred upon the contents of Ex DW27. This document purported to set out details of the sales by Davey Products to two business houses that were engaged in waste water treatment; they were described as "Envirocycle" and "Biocycle". The sales were also expressed to be those that had been made by Davey Products in New South Wales and they related to Doc 3, Doc 7, Sumprat 140 and Sumprat 220 pumps. The first section of the exhibit particularises sales in the five financial years commencing 1 July 1988 and concluding on the 30 June 1993 and the next section is entitled "Pump Returns to Davey (NSW) ex Biocycle and Envirocycle". Under that heading, particulars of pumps returned are set out. There is then an enigmatic entry:
"See indexed account books x 2
These figures have been collated from Customer Sales Reports, Warranty Transaction Reports, and Return Job Cards over the above period."
It would seem that the reference "indexed account books x 2" is, in fact, a reference to the bundle that is marked "DW28". But Mr Brookfield's major complaint is that the documents referred to in the latter part of Ex DW27 as "Customer Sales Reports, Warranty Transaction Reports, and Return Job Cards" were never the subject of discovery by Davey Products.
Mr Wilsdon, in his affidavit had alleged that Ex DW27 was a schedule summarising how many of his company's pumps were sold to "manufacturers of waste water treatment systems" and how many were returned to or replaced by Davey Products. There then appears in Ex DW27 the notation, without explanation, about the source material that was used by Mr Wilsdon in the collation of his figures.
What reports and what job cards? Where were they housed? When did he examine them? How did he proceed with the collation? If they were included in the records that had been destroyed in a fire - whether in 1993 or 1991 - how was is that Mr Wilsdon was able to refer to them as the source of his collation when he compiled Ex DW27 on 27 July 1995?
These were all matters that were open to Mr Brookfield, his company and his legal representatives during the course of the trial. If they were then matters of importance (and I express no view of that subject) they were on notice and they had the opportunity to investigate the matters. It was not a case where the very existence of the documents was unknown to them.
In my opinion, the documents described in Ex DW27 as "Customer Sales Reports, Warranty Transaction Reports and Return Job Cards" were discoverable documents in the trial and should have been discovered by Davey Products as part of the usual discovery process prior to the commencement of the trial. I am by no means so certain that all the documents that were used or may have been used in the compilation of the information in Ex DW25 would have likewise been discoverable. Their relevance is in doubt because Mr Wilsdon was simply disclosing details of all sales of all pumps for all purposes throughout Australia. Those purposes included usages other than the usage of pumps in the treatment of waste water. In any event, it is not necessary to come to a final decision on this subject because, notwithstanding that there may have been deficiencies in the respondent's discovery, those deficiencies would have been self evident prior to trial, if Mr Brookfield's advisers had regarded them as matters of importance. Indeed Mr Brookfield acknowledged during the course of argument that he and his legal representatives were aware, prior to and during the course of the trial, of the information that is contained in Exs DW25 and DW27.
Mr Brookfield also complained that his solicitors had, on numerous occasions prior to trial, pursued the subject of further and better discovery in correspondence with the solicitors for the respondent. I invited Mr Brookfield to bring to my attention an example of a specific request for discovery of the "Customer Sales Reports, Warrant Transaction Reports and Return Job Cards". However he was unable to produce any such specific request.
DESTRUCTION OF RECORDS
Finally, and somewhat surprisingly, Mr Morrow explained that in August 1996, the New South Wales office of Davey Products was moved and as a consequence of that move all their old records were destroyed. Mr Brookfield was highly critical of this information alleging that it breached provisions of the Taxation and Corporations Laws which required business houses to maintain records for seven years. Mr Brookfield drew the Court's attention to the decision of the High Court in Allen v Tobias (1957-1958) 98 CLR 367 where Dixon CJ and McTiernan and Williams JJ quoted with approval at 375 the following extract from the opinion of the Privy Council in The Ophelia (1916) 2 AC 206 at 229-230:
"If any one by deliberate act destroys a document which, according to what its contents may have been, would have told strongly either for him or against him, the strongest possible presumption arises that if it had been produced it would have told against him; and even if the document is destroyed by his own act, but under circumstances in which the intention to destroy evidence may fairly be considered rebutted, still he has to suffer. He is in the position that he is without the corroboration which might have been expected in his case."
The difficulty that Mr Brookfield faces in the application of those observations to his case is that the act of destruction in August 1996 preceded by over a year his present application to this Court and occurred some six months after the trial had been completed. None of the issues raised in the appeal to the Full Court addressed the need for the production or examination of the respondent's records. There is no evidence before the Court to suggest that the act of destruction of the records was in any way connected to the relationship that Mr Brookfield and his company had with Davey Products. I am not able to draw any adverse inference in these proceedings against Davey Products as a consequence of the destruction of those records.
THE RESPONDENT'S SOLICITORS
Mr Brookfield has submitted to the Court that the essential nature of the litigation before Branson J was his complaint that the pumps supplied to him and to his company by Davey Products continuously broke down. His claim is that other customers of Davey Products would have suffered similar difficulties but that he and his company were denied access to the records of Davey Products and thereby denied the opportunity of establishing that it was not just Mr Brookfield and his company who suffered these difficulties. He has gone so far as to allege that the failure to make discovery of "customer sales reports, warranty transaction reports and return job cards" was a deliberate omission by the respondent and that the respondent's solicitors were involved in, and must take responsibility for, the deliberate omission.
A solicitor, as an officer of the Court, has a duty to the Court to ensure that the process of discovery is completed in accordance with the Rules of Court. A solicitor must assist and advise his client as to his client's duty and if the client should persist in omitting relevant documents from the affidavit of discovery "it seems to me plain that the solicitor should decline to act for him any further": Myers v Elman (1940) AC 282 at 293 per Viscount Maughan. But there is no evidence, in the circumstances of this case, of a deliberate omission or a deliberate refusal to follow the solicitor's advice. The role of the solicitor was also addressed in Woods v Martins Bank Limited (1959) 1QB 55 at 60 by Salmon J:
"It cannot be too clearly understood that solicitors owe a duty to the Court, as officers of the Court, carefully to go through the documents disclosed by their clients to make sure, as far as possible, that no relevant documents have been omitted from their clients' affidavits."
(See also the remarks of MacFarlan J in Ferguson v Mackaness Produce Pty Ltd (1972) NSWR 66 at 68-69.
Mr Mills, the solicitor for Davey Products, deposed in his affidavit that was sworn on 3 March 1998 for use in these proceedings:
"The purpose of the evidence in paragraphs 65 and 66 of the Wilsdon affidavit was to illustrate the number of pumps sold and the number of pumps returned under warranty. It was not evidence as to why those pumps were returned or what fault had occurred. Accordingly documents regarding the problems were not considered to be relevant."
What Mr Mills says might be correct as to the purpose of the affidavit, but it is not the point that is presently under consideration. That point is whether there had been a failure by Davey Products to make adequate discovery. The documents dealing with the return of pumps and the nature of the faults were, in my opinion, clearly relevant to the issues in the trial and therefore discoverable. The question then, is what consequences, if any, flow from the respondent's failure to make adequate discovery? There is not, in my opinion, the slightest suggestion of bad faith on the part of the respondent's solicitors. That conclusion is obvious because of the express reference to the "non-discovered" documents in Ex DW27 and because of the contents of Ex DW28. This is a clear case of a genuine mistake about whether or not certain documents were discoverable.
INADEQUATE DISCOVERY
In Commonwealth Bank of Australia v Quade (1991) 178 CLR 134, Mr and Mrs Quade and other members of their family arranged a foreign currency borrowing in Swiss francs from the Commonwealth Bank of Australia. The value of the Australia dollar as against the Swiss franc decreased dramatically over the period of the loan with the result that the Quade's loan increased significantly in terms of Australian dollars with ruinous consequences. They sued the bank claiming damages for breach of s 52 of the TP Act, breach of the Contracts Review Act 1988 (NSW) and common law negligence. It was common ground that the Quades would succeed on all three causes of action or on none of them. In due course the matter went to trial; the Quades were unsuccessful and their application was dismissed. They appealed to the Full Court of the Federal Court and upon the hearing of the appeal they moved the Court to receive further evidence pursuant to s 27 of the Federal Court of Australia Act 1976 (Cth) and O 52 r 36 of the Federal Court Rules 1979 (Cth). The further documents were bank documents that were produced, after the conclusion of the trial, in recognition of the fact that they had been wrongly omitted from the bank's affidavit of documents that had been filed and served in purported compliance with the order for discovery. (See Quade v Commonwealth Bank of Australia (1991) 27 FCR 569 at 573 per Burchett J). In assessing the importance of the decision in Quade's case it is of significance to note that Burchett J in the Full Court said (at p580) that the Quades had not been lacking in diligence; they had required the bank "to make discovery of documents, and it was entirely the (bank's) default which rendered the evidence unavailable to the appellants." The Full Court determined that the motion to adduce fresh evidence upon the appeal should be allowed with costs and made appropriate orders including an order that there be a new trial. The bank appealed to the High Court by special leave, and with the agreement of the Court and at the request of the parties, the Court confined its consideration of the appeal to the question of "what is the appropriate approach (or "test") to be adopted by an appellate court for determining whether a new trial should be ordered when documents which should have been discovered were not discovered by the successful party." (per Mason CJ, Deane Dawson Toohey and Gaudron JJ at 139).
Burchett J in the Federal Court noted at p 580 that the general rule concerning the basis on which a new trial may be granted upon an appellant's claim to have discovered fresh evidence was stated by Dixon J in Orr v Holmes (1948) 76 CLR 632 at 640:
"If a trial has been regularly conducted and the party against whom the verdict has passed cannot complain that evidence has been wrongly received or rejected or that there has been a misdirection or that he has not been fully heard or has been taken by surprise or that the result is not warranted by the evidence, the successful party is not to be deprived of the verdict he has obtained except to fulfil an imperative demand of justice. The discovery of fresh evidence makes no such demand upon justice unless it is almost certain that, if the evidence had been available and had been adduced, an opposite result would have been reached and unless no reasonable diligence upon the part of the defeated party would have enabled him to procure the evidence."
In their joint judgment, the members of the High Court endorsed the remarks of Dixon J in Orr v Holmes, adding that his Honour had repeated the substance of those comments in Greater Wollongong Corporation v Cowan (1955) 33 CLR 435 at 444 when he said:
"If cases are put aside where a trial has miscarried through misdirection, misreception of evidence, wrongful rejection of evidence or other error and if cases of surprise, malpractice or fraud are put on one side, it is essential to give effect to the rule that the verdict, regularly obtained, must not be disturbed without some insistent demand of justice. The discovery of fresh evidence in such circumstances could rarely, if ever, be a ground for a new trial unless certain well-known conditions are fulfilled. It must be reasonably clear that if the evidence had been available at the first trial and had been adduced, an opposite result would have been produced or, if it is not reasonably clear that it would have been produced, it must have been so highly likely as to make it unreasonable to suppose the contrary. Again, reasonable diligence must have been exercised to procure the evidence which the defeated party failed to adduce at the first trial."
The other members of the Court in Greater Wollongong Corporation v Cowan, Williams Webb, Kitto and Taylor JJ concurred in the Chief Justice's remarks.
The High Court in Commonwealth Bank v Quade emphasised (at p 141) that Orr v Holmes and Greater Wollongong Corporation v Cowan had established that a reconciliation of "the demands of justice" and the "policy" that there be an end to litigation at least prima facie dictates that:
"The successful party should be deprived of the verdict in his favour only if the unsuccessful party persuades the appellate court that there was no lack of reasonable diligence on his part and that it is reasonably clear that the fresh evidence would have produced an opposite verdict."
The members of the High Court then went on to hold, however, that the stringent rule in the ordinary class of case did not apply in a case, such as that then before the Court, where the unavailability of the evidence at the trial resulted from a significant failure by the successful party to comply with an order for discovery of relevant documents in his possession or under his control. In those circumstances, the Court was of the view that a lower threshold or test would suffice to justify an order for a new trial. The Court declined to enunciate a general rule but noted that it would be necessary for an appellate court to take account of:
"a variety of possibly competing factors, including, in addition to general considerations relating to the administration of justice, the degree of culpability of the successful party, any lack of diligence on the part of the unsuccessful party and the extent of any likelihood that the result would have been different if the order had been complied with and the non-disclosed material had been made available. While it is not necessary that the appellate court be persuaded in such a case that it is "almost certain" or "reasonably clear" that an opposite result would have been produced, the question whether the verdict should be set aside will almost inevitably be answered in the negative if it does not appear that there is at least a real possibility that that would have been so."(at 143)
CONCLUSION
The decision in Commonwealth Bank v Quade is not, of course, on all fours with the present application. For example, it was a case which formed part of the normal appellate process; the issue of "fresh evidence" was one of the grounds of appeal to the Federal Court. In the present case, Mr Brookfield and his company exhausted the appellate process some time ago and are now raising, for the first time, the issue of "fresh evidence" as a prelude to the intended application to apply to have the judgment set aside. I apprehend that the task confronting the applicants in the present case is the more difficult by virtue of them having had the earlier benefits of the appeal system. Nevertheless, it seems to me that the principles that can be extracted from the decision in Commonwealth Bank v Quade may be utilised appropriately in the present proceedings for the purposes of demonstrating that, in the ultimate, this application must fail.
The most significant difference, when comparing the facts of this case with those in Commonwealth Bank v Quade, is that in the latter case the Quades did not know and were not lacking in diligence in their failure to know about the documents that were subsequently discovered by the bank. In the present case that cannot be said of Mr Brookfield and the company and their advisers with respect to the undiscovered documents that were described in Ex DW27 as "customer sales reports, warrant transaction reports and return job cards".
The insertion of the acronym indicating "no records" in Ex DW25 must now be accepted as inaccurate. Be that as it may, as Mr Brookfield conceded during the course of his submissions, Ex DW28 contains the two account books which, in turn, contain details of pumps that had been returned to Davey Products in New South Wales in the relevant two year period. The disclosure of that information, even though it did not contain information about the reasons for the returns and replacements, did contain sufficient information to contradict the assertion that there were "No Records" and that fact would have been sufficient to alert the applicants and their advisers if they had perceived the issue to be one of importance.
Despite Mr Wilsdon's incorrect evidence about the date of the fire, Ex DW27 contained the informative entry:
"These figures have been collated from customer sales reports, warranty transaction reports, and return job cards over the above period."
That endorsement self evidently acknowledged the existence of additional documents of those descriptions and so Mr Brookfield and his company were thereby alerted to their existence as were their legal advisers. Did they lack diligence in failing to pursue the matters? Perhaps they did not then consider the matters to be relevant; that issue remains unresolved because Mr Brookfield fell back upon his legal representatives stating that he was guided by them; but they have not been given the opportunity to speak in their defence. Whilst it is true that those documents were clearly discoverable and whilst I must reject the explanation advanced by the solicitor for Davey Products that he did not consider them relevant, the fact remains that the existence of those documents was well known to Mr Brookfield and his company. His complaints at this late stage of the failure to make proper discovery of them carry the hallmark of an argument of desperation. In my opinion, the applicants have failed to satisfy me that there was no lack of diligence on their part, in respect of the subject of discovery and the respondent's failure to make proper discovery.
There is yet another reason why this application should fail. Mr Brookfield attempted to submit that the production of the missing documents (being those referred to in Ex DW27 as "consumer sales reports, warrant transaction reports and return job cards") would constitute evidence justifying his complaints that the Doc 3 and Doc 7 pumps were, throughout Australia, being returned because of their unsatisfactory performances. That is not correct because the exhibit only referred to dealings with the two New South Wales manufacturers. But let it be assumed at this stage that such a proposition could be correct. Proof of that fact would not assist Mr Brookfield or Septic Products because of her Honour's finding (which was upheld by the Full Court) that he and his company were unsuccessful because of him having modified the Parco Beaver System and used the pumps in the modified system. At p 74 of her judgment, Branson J made the specific finding that there was "a relationship between the established failure of a significant proportion of the Doc 3 pumps supplied to Septic Products by the respondent and the modifications effected by Mr Brookfield to the Parco Beaver System."
The issue that must be determined by the Court is whether or not Mr Brookfield has placed before the Court sufficient material to warrant the Court interfering with the due execution of a judgment which, on the face of it, has been properly obtained. Although the Court has a general power to stay the execution of a judgment: O 37 r 10: there is a general principle that a successful party should not be deprived of the fruits of its victory: The Annot Lyle (1886) 11 PD 114 at 116; McBride v Sandland (1918) 25 CLR 369 at 374. Mr Brookfield and his company are attempting to invoke the jurisdiction of this Court to stay the execution of a judgment and exceptional circumstances need to be shown before the Court will exercise its discretion in their favour: Jennings Construction Limited v Burgundy Royal Investments Pty Ltd No 1 (1986) 161 CLR 681 at 684. That was a case dealing with an application for leave to appeal to the High Court and for a stay pending the determination of that application. However I see no reason why the principles propounded in that case should not apply in the present circumstances.
The applicants' case, as it developed, backed away from the allegation of fraud even though Mr Brookfield still maintained that there had been a gross dereliction of duty on the part of the respondent and its solicitors in the discovery process. Initially he also alleged perjury on the part of Mr Wilsdon with respect to the date of the fire but the force of that argument dissipated with the clear and frank admissions by the witnesses for the respondent that a mistake had been made and that the correct date of the fire was in 1991. Essentially therefore, the case for the applicants centres upon the alleged non discovery of documents. In particular, the documents that were not the subject of discovery were those identified in Ex DW27 being, the customer sales reports, the warranty transaction reports and the return job cards and, to a lesser extent, the source documents for the information in Ex DW25.
I have come to the conclusion that the complaints made by Mr Brookfield on behalf of the applicants on the subject of non discovery of documents are not of sufficient substance to warrant the intervention of the Court. The existence of those documents, and in particular the documents that are referred to in Ex DW27 was there to be seen and Mr Brookfield acknowledged that he did see reference to them during the course of the trial. It is not as if the existence of those documents first came to light subsequent to the date of judgment. Clear and explicit reference was made to them in the document that was compiled by Mr Wilsdon and which became an exhibit to his affidavit. It is true to say that the respondents should have made discovery of those documents. But is equally true to say that Mr Brookfield's legal advisers could have demanded (by reference to the contents of Ex DW27) further and better discovery of the documents that were there identified. Insofar as Mr Brookfield seeks a stay of judgment based upon his intended application to have judgment set aside, I must rate his chances of succeeding in that latter application, on the information presently before the Court, as very slight. I have therefore come to the conclusion that this is not a case where it would be appropriate to stay the execution of the judgment. Having arrived at that conclusion, it follows that it would not be appropriate to consider the application for an order for further and better discovery.
In my opinion, the present application should be dismissed with costs.
I certify that this and the preceding twenty (20) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice O'Loughlin