Supreme Court of WA|2007-04-03|Before: Martin CJ

INTERNATIONAL LAND DEVELOPMENTS PTY LTD -v- DIAMO NOMINEES PTY LTD [2007] WASC 96 (3 April 2007)

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

CITATION : INTERNATIONAL LAND DEVELOPMENTS PTY LTD -v- DIAMO NOMINEES PTY LTD [2007] WASC 96

BETWEEN : INTERNATIONAL LAND DEVELOPMENTS PTY LTD (ACN 009 124 743)

Contempt of court - Motion for contempt of court - Where orders required defendant to file affidavit of discovery - Alleged breach of order by failure to give adequate discovery by failing to annexe a list of all documents which were, or had been, in the defendant's possession, custody or power - Consideration of whether act or omission of contempt requires the act to be wilful therefore satisfying the mental element required by the criminal standard of proof

The plaintiff pay the defendant's costs of the motion to be taxed, if not agreed

Defendant : Mr C L Zelestis QC and Mr P Van Der Zanden

1 MARTIN CJ: Before me today is the motion of the plaintiff, International Land Developments Pty Ltd, for orders that the defendant, Diamo Nominees Pty Ltd, be punished for contempt in that it failed to comply with the orders made by Master Sanderson on 19 May 2006. It is alleged the defendant filed and served upon the plaintiff, in purported compliance with the orders of the Master, an affidavit dated 7 June 2006; which, in breach of those orders, did not discover all documents that were, or had been, in the defendant's possession, custody or power.

2 Particulars of the documents that were not discovered are given in the amended summons. They fall into two categories: first, the documents subsequently discovered by the defendant in an affidavit dated 16 June 2006; and second, the documents, copies of which are annexed to the affidavit of Clare Park sworn 28 March 2007 and marked CP1 and CP4.

3 It is not alleged that there was a failure to make adequate or proper inquiry with respect to the existence of documents other than those in the list annexed to the affidavit of discovery; nor is any specific allegation made of wilfulness or knowledge in respect of the insufficiency of the list attached to the affidavit. Rather, the plaintiff submits that it is unnecessary to allege or prove anything other than the failure to give adequate discovery.

4 It is important to emphasise that this is not a case in which it is alleged that there was a failure to make due or proper inquiry with respect to the documents to be listed in the annexure to the affidavit. Different considerations might apply in such a case. This is a case which is put squarely and solely on the basis that contempt was committed by reason of the failure to annexe to the affidavit a list of all documents which were or had been in the possession, power or custody of the defendant.

5 It is established by the decision of the High Court in Witham v Holloway (1995) 183 CLR 525 that the burden of proving the contempt rests upon the plaintiff throughout and must be satisfied to the highest standard known to the law; namely, beyond reasonable doubt. This was common ground between the parties. It is expressly conceded by counsel for the plaintiff that that burden extends to proving that the acts said to constitute the contempt were not casual, accidental or unintentional.

6 With that burden and standard of proof firmly in mind I move to the evidence which was tendered by the parties; starting with the plaintiff. First, I refer to the affidavit of Richard Gordon Lilly sworn 15 August 2006. That affidavit annexes the order made by the Master in Chambers on 19 May 2006. That order was made in proceedings commenced pursuant to O 26A of the Rules of the Supreme Court 1971 (WA) ("the Rules") for what is generally described as pre-action discovery. The Master's order finally disposed of those proceedings.

7 The order made by the Master required the defendant to give discovery on affidavit "sworn by a director or its company secretary, of all documents that are or have been in the Defendant's possession, custody or power which have come into existence since 7 September 2004" falling within a number of categories described in that order.

8 On 25 May 2006, an extracted copy of the Master's order was served on the solicitors for the defendant. The annexures to Mr Lilly's affidavit reveal there was then a string of correspondence between the solicitors for the parties. On 29 May 2006, Mr Gough, one of the solicitors acting on behalf of the defendant, sent an email to Mr Lilly advising that due to time pressures, the affidavit required by the Master's orders was not ready and that he anticipated getting the affidavit to Mr Lilly by the following Tuesday. That was followed by a facsimile dated 1 June 2006 from the solicitors for the plaintiff to the solicitors for the defendant. The facsimile complained of the lack of receipt of the affidavit and posed the question as to whether further orders were necessary in order to compel compliance.

9 On the same day (1 June 2006), another facsimile was sent by the solicitors for the plaintiff to the solicitors for the defendant. This facsimile advised that since the earlier facsimile was sent, they had received instructions to actively pursue the defendant and that in the event that an affidavit was not served by close of business that day, steps would be taken "in respect of the defendant's contempt of Court" without further notice.

10 The following day (2 June 2006), an email was sent from the solicitors for the plaintiff to the solicitors for the defendant advising again that contempt proceedings would be commenced, but on this occasion "one last opportunity to avoid an application for contempt of Court" was offered if the affidavit of discovery was provided by 11 am on Tuesday, 6 June 2006.

11 The following day (3 June 2006), the solicitors for the defendant sent an email to the solicitors for the plaintiff inquiring whether the plaintiff would be prepared to allow the defendant until 11 am on 7 June 2006 to provide the affidavit of discovery. That email was responded to on the same day (3 June 2006) by an email advising that deferral of provision of the affidavit until 11 am on 7 June 2006 was acceptable, but that an application would be made to the Court if the affidavit was not provided by then.

12 Very shortly before 11 am on 7 June 2006 an email was sent from the solicitors for the defendant to the solicitors for the plaintiff attaching an affidavit of discovery sworn by a director of the defendant, Trevor Stanley John Betts, and to which is attached a list of documents in the form required by the Rules.

13 That list comprises a total of 161 documents, 102 of which are in Pt I of the first schedule, and the remaining 59 in Pt II of the first schedule. Amongst the first schedule are many documents described as emails to and from Mr John Poulsen of Minter Ellison.

14 The email attaching an affidavit of discovery was followed by communications in respect of the arrangements for inspection of the documents discovered and arrangements were made to inspect those documents during the afternoon of 7 June 2006. That inspection took place and by facsimile bearing the same date; that is, 7 June 2006, the solicitors for the plaintiff requested copies of some of the documents discovered and also complained as to the adequacy of the discovery given.

15 By email of 8 June 2006 from the solicitors for the defendant to the solicitors for the plaintiff, the solicitors for the defendant advised that the vast majority of the documents that were discovered came from the hard copy files maintained by Mr Poulsen.

16 It was further advised that as a result of the letter of complaint with respect to the adequacy of the discovery, it had been decided to carry out a full electronic search of the records held by the solicitors for the defendant.

17 The email also advised that that search could be conducted in part on the internal system and in part, needed to be conducted by performing a search on back-up tapes which are stored externally. The solicitors for the plaintiff were advised that a search of the back-up tapes was likely to take about a week. The email also advised that a preliminary search revealed that extra documents had been located.

18 That email was met with a complaint from the solicitors for the plaintiff by letter dated 8 June 2006. The complaint was accompanied by a rhetorical question as to why an application should not be made to the court by way of contempt. That letter received a reply by facsimile dated 9 June 2006 from the solicitors for the defendant in which it was advised that at the time Mr Betts swore his affidavit, "both he and we", being the solicitors for the defendant, "were satisfied, on reasonable grounds, that it was accurate" and it was suggested that any contempt proceedings would be defended.

19 That led to a further exchange of communications which I need not detail other than to observe that by an email dated 14 June 2006 an unsworn version of a further affidavit of discovery was sent by the solicitors for the defendants to the solicitors for the plaintiff. That produced a letter dated 15 June 2006 from the solicitors for the plaintiff to the solicitors for the defendant advising that they had received instructions to apply to the Supreme Court for orders that the defendant be punished for contempt for failing to comply with the earlier orders. The solicitors for the plaintiff also advised that they would await the filing of the further affidavit before commencing the proceedings which had been foreshadowed.

20 The executed affidavit was then provided by the solicitors for the defendant to the solicitors for the plaintiff by an email dated 16 June 2006. It annexes a list of further documents which are some 63 in number, of which 55 are in Pt I of the first schedule and eight in Pt II of the first schedule. Almost all the documents listed are emails. Arrangements were then made for inspection of those documents on 19 June 2006. The motion for contempt was lodged on 17 August 2006.

21 The plaintiff also relies upon another affidavit of Richard Gordon Lilly sworn 9 January 2007. This affidavit annexes copies of a number of documents which were discovered by the second affidavit of discovery. The first two annexures are documents being heads of agreement relating to land at Drummond Cove, Geraldton. Nothing turns on these documents. They are stamped and executed copies of documents that may or may not have been listed in the first affidavit of discovery provided by the defendant; being, that sworn on 7 June 2006. Whether or not they were misdescribed in that affidavit does not seem, to me, to be of any great moment because on any view there were more than 60 documents that should have been, but were not, discovered in the first affidavit sworn 7 June 2006. Whether that number was 63 or 61 does not make any significant difference in these proceedings.

22 The other documents that are attached to the second affidavit of Mr Lilly are copies of emails. The purpose of annexing each of these emails is to show that they reveal, on their face, that copies appear to have been addressed to a Mr Philippe Steinier, a director of the defendant. I am asked to infer from that address that they were in fact received by Mr Steinier on or about the dates which they bear and that therefore the explanation which has been provided by the defendant for not including the documents omitted from the first affidavit of discovery does not extend to and include these documents.

23 For reasons that I will give, it does not matter whether or not Mr Steinier did in fact receive those emails. However, in case the matter proceeds further, I should make all arguably relevant findings of fact. Given that the burden and standard of proof in these proceedings is beyond reasonable doubt, the fact that these documents, on their face, bear a particular email address is not, in my view, sufficient to enable me to find that they were in fact received by Mr Steinier on or about those dates. I have no evidence to establish that the address shown is in fact Mr Steinier's address or to establish the fact of transmission to, or receipt by, Mr Steinier. So I am not prepared to find that those emails were received by Mr Steinier.

24 The final affidavit relied upon by the plaintiff is that of Clare Park sworn 28 March 2007. The only relevant portions of that affidavit are the annexures CP1 and CP4; being, the second category of the documents referred to in the particulars of the motion. CP1 is an executed transfer of land document which, by page 3, appears to have been prepared by Messrs Minter Ellison.

25 The defendant admits that Minter Ellison were at all material times its solicitors for the purposes of the transaction in respect of which the order for discovery was made. The defendant also admits that this document was executed by the directors of the defendant and that it was not listed in the list annexed to the affidavit of 7 June 2006. However, the defendant does not admit that the executed document was ever in its possession, custody, power or control.

26 The plaintiff asks me to infer from the form of the document and in particular from the fact that it appears to have been prepared on the basis that it would, in due course, be lodged by the defendant's solicitors, that it was at some point in its executed form in the possession, custody, power or control of the defendant. Having regard to the burden and standard of proof, I am not prepared to draw that inference.

27 There are a number of hypothetical scenarios one can imagine that would not result in the document ever having been in the possession, custody, power or control of the plaintiff. One hypothetical scenario which I put to counsel for the plaintiff during argument was a circumstance in which the document might have been prepared by the solicitors for the defendant, produced at a meeting, given to the solicitors for another party to the transaction, then presented to the directors of the defendant company for their execution. They may have executed it, but without taking possession, custody, power or control of the document and then returned it to another party who, in due course, lodged it at the Land Titles Office.

28 Because that or other possible hypothetical scenarios have not been excluded by the evidence, I am not prepared to find as a fact that the document, CP1, was ever within the possession, custody, power or control of the defendant.

29 The first page of the document which is CP4 attached to the affidavit of Ms Park is no longer relied upon by the plaintiff. The plaintiff accepts that it cannot establish that it was ever within the possession, custody, power or control of the defendant. The second page of that document is a cheque for $500,000 drawn in favour of the defendant. The defendant admits that this document was, at one point, within its possession, custody or power and that it was not listed in the list attached to the affidavit of 7 June 2006.

30 However, because the document is a cheque, and a cheque for a substantial sum, I am prepared to infer that it is a document which very likely would have been in the possession of the defendant for a very limited period. It is much more likely that upon receipt of the cheque, the defendant would have banked it promptly and it would therefore very likely have been only in its possession, custody or power for a very short period. The cheque is dated 18 November 2005. Therefore, I find that the document would have been briefly in the possession of the defendant on or about that date, which is some six months in advance of the execution of the first affidavit of discovery.

31 In the absence of any evidence, I do not find that any person who was relevantly the acting mind of the defendant was consciously aware of the existence of this cheque and its omission from the list attached to the affidavit of discovery at the time it was filed on 7 June 2006. The fact that the cheque was briefly in the possession of the defendant six months earlier does not, of itself, sustain such a finding.

32 I turn then to the evidence relied upon by the defendant and firstly to the affidavit of Craig Stuart Gough sworn 11 October 2006. Mr Gough deposes to the fact that he was a solicitor employed by Messrs Minter Ellison and was acting for the defendant in the matter to which I have referred up until 30 August 2006. He refers to the fact that after the order for discovery he had a number of conversations with Mr John Poulsen, who was a partner at Minter Ellison, regarding the need for him to have full access to all of his files relating to the Drummond Cove development. Mr Gough deposes to the fact that he believed Mr Poulsen had arranged for his personal assistant to arrange delivery of those files to him.

33 Mr Gough deposes that it is Minter Ellison policy that all electronic documents must be printed out and stored on the file as a paper copy. Mr Gough then refers to the affidavit of discovery sworn by Mr Betts and deposes to the fact that it was prepared by Kristy Stingemore, a solicitor of Minter Ellison acting under his supervision. He deposes to his belief that the first affidavit of discovery included all the documents the defendant had provided to Minter Ellison or which Minter Ellison otherwise held that were discoverable under the order.

34 Mr Gough further deposes to the fact that he informed Mr Betts prior to his execution of the first affidavit of discovery that "Minter Ellison had, to the best of their ability, identified all of the relevant documents that the defendant had supplied to us and that we held, and included them in the affidavit." I digress to observe that that uncontradicted statement made by Mr Gough to Mr Betts would have embraced any emails that were held by Messrs Minter Ellison that had also been sent to the defendant. The statement made by Mr Gough to Mr Betts would, therefore, have given rise to a reasonable belief on the part of Mr Betts to the effect that; for example, the three emails apparently bearing Mr Steinier's address attached to the second affidavit of Mr Lilly, being emails emanating from Minter Ellison, had in fact been included within the documents listed in the annexure to the affidavit of discovery. As I have already observed, there are a number of entries in that list that would meet the description of those emails, albeit not exactly as to date.

35 Mr Gough goes on to depose that after receiving the fax from Freehills dated 7 June 2006 he made further inquiries of Mr Poulsen and discovered that there appeared to be some relevant documents that Mr Poulsen held in electronic form which had not previously been printed out and which had been overlooked when the first affidavit of discovery was prepared. He deposes to the fact that those documents had not been located on the files previously delivered to him. He also deposes to the fact that Mr Poulsen advised him that he did not realise that those further documents had not in fact been on his paper file which he had previously sent to Mr Gough.

36 Mr Gough then deposes to the second affidavit of discovery being sworn by Mr Betts and to the fact that the documents discovered in that affidavit were electronic documents held by Mr Poulsen which did not appear to have been previously printed out and were therefore overlooked when the first affidavit of discovery was prepared. He deposes to the fact that the failure to discover those documents was due to an oversight on the part of the solicitors for the defendant.

37 Mr Gough was not cross-examined and his evidence was not contradicted. I accept it accurately depicts the events relating to the preparation of the affidavits of discovery.

38 The defendant also relies upon an affidavit of Mr Poulsen sworn 6 December 2006. In that affidavit, Mr Poulsen confirms the evidence given by Mr Gough. He also deposes to his belief that the reason why the relevant emails; being, the emails the subject of the second affidavit, were not on the paper file is because at the time the printer, to which he printed emails, was located some distance from his office. He expresses the view that it is likely that when he printed those emails he may have been distracted by a phone call or by a person entering his office which resulted in him not collecting the printed emails. He has since resolved that problem by having a printer located on his desk to which all emails are printed. This evidence was not contradicted and I accept it.

39 There is a further affidavit upon which the defendant relies prepared by Kristy Cherie Stingemore. That affidavit mainly deals with the two executed deeds of agreement. As I have observed, they do not appear to me to be of any particular significance to these proceedings.

40 On the basis of that evidence, I make the following findings of fact.

41 It is clear that the affidavit of 7 June 2006 did not annex a list which set out all the documents which are, or had been, in the possession, custody, power or control of the defendant. The list which was annexed to that affidavit was deficient in that it omitted reference to all the documents that were listed in the second affidavit sworn on 16 June 2006 and to the cheque which is part of CP4. However, the plaintiff has not established that the defendant, or any person whose state of mind or knowledge could be regarded as that of the defendant, was aware that the affidavit was deficient in any of those respects.

42 I also find that the plaintiff has failed to prove that the deficiencies in the list annexed to the affidavit sworn on 7 June 2006 were intended by the defendant or that those deficiencies came about other than by way of accident. I make a further positive finding to the effect that from the perspective of the defendant, the deficiency in the list attached to the affidavit was both accidental and unintended. I make that finding because the documents omitted from the list annexed to the first affidavit were, with the exception of the cheque, all documents within the possession of the defendant's solicitors. There is no evidence that the defendant knew these documents existed. I accept that the defendant had been advised, erroneously as it happens, by its solicitors that all documents in its possession were listed in the annexure to the affidavit. There was no reason for the defendant to doubt that assertion. The inadvertent and unintended omission of the cheque from the list is, in my view, easily explained by the fact that it would very likely have been in the possession of a bank, having only been briefly in the possession of the defendant six months earlier.

43 The plaintiff's submission is that because the list annexed to the affidavit filed and served on 7 June 2006 was deficient in the way in which I have found and because the filing and service of the affidavit was a deliberate and intentional act which did not comply with the order made by the Master, that is sufficient to establish a contempt of court. In other words, the plaintiff submits that I should approach this matter from the perspective of strict or absolute liability.

44 The defendant, on the other hand, says that before I could find that an act or omission constituting a contempt of court had been established, I must find that the act was wilful in the sense that there was knowledge of the facts that gave the acts or omissions the quality of being a contempt consistently with the general principles relating to the mental element in criminal law.

45 There is a slight variation on the defendant's position which is open but was not quite enunciated to me by the defendant and that is to the effect that if it is not proven that those aspects of the act or omission which are said to constitute a contempt of court came about otherwise than by accident and were intended by the contemnor, then the prosecution has failed to establish the requisite quality of wilfulness or deliberation.

46 I address the question of law thrown up by these different submissions starting historically with the decision of Warrington J in the case of Stancomb v Trowbridge Urban District Council [1910] 2 Ch 190. This is a decision which is often cited in this area. The case concerned an application brought under Rules of the Supreme Court 1883 (UK) which provided for enforcement of orders against a corporation where those orders had been "wilfully disobeyed". There was thus an express requirement of proof of wilfulness in the rules which were applied in that case. Warrington J observed at 194:

"I think the expression 'wilfully' ... is intended to exclude only such casual or accidental and unintentional acts as are referred to in Fairclough v Manchester Ship Canal Co." (footnote omitted)

47 In later cases, that observation in respect of the relationship between wilfulness and the exclusion of casual, accidental or unintentional acts has been taken beyond its enunciation in the context of the particular rule applicable in that case.

48 It is significant to observe that Warrington J went on to apply the principle he had enunciated to the facts of the case, ascertaining which of the work that had been done by the defendant in that case (and which was said to constitute the contempt), could properly be characterised as having been neither casual nor accidental nor unintentional. He made specific findings in respect of those issues in relation to each of the particular aspects of the work undertaken.

49 I turn then to the decision of the High Court in Australasian Meat Industry Employees' Union v Mudginberri Station Pty Ltd [1986] HCA 46; (1986) 161 CLR 98. It is important to note at the outset that this was a case which was only concerned with penalty. It was not a case in which there was any live question with respect to the nature or extent of the contempt. It was a case in which the alleged contemnor had flagrantly acted in breach of the orders of the Court by maintaining picket lines. In the joint judgment of Gibbs CJ and Mason, Wilson and Deane JJ, it was observed at 109:

"In more recent times a strong stream of English and Australian authority has emerged to support the imposition of fines for disobedience to orders in circumstances where the disobedience is wilful."

50 Then a line of cases is set out, some of which are then considered. Their Honours refer to the decision of Stamp J in the case of Steiner Products Ltd v Willy Steiner Ltd [1966] 1 WLR 986 in which his Honour characterised earlier decisions, including that of Warrington J in Stancomb v Trowbridge Urban District Council (supra), in terms that any "disobedience which was worse than casual, accidental or unintentional must be regarded as wilful" (at 111). This observation appears to equate the notion of wilfulness with a disobedience which is not properly characterised as casual, accidental or unintentional.

51 After referring to cases concerning the availability of a penalty by way of fine for a contempt which was not casual, accidental or unintentional, their Honours in the High Court observe (at 112 - 113):

"The correctness of the approach outlined in the preceding paragraph was endorsed by the House of Lords in Heatons Transport; their Lordships explicitly citing Steiner and Mileage Conference as precedents for the imposition of a fine in a case of disobedience to an order which is more than casual, accidental or unintentional. This indorsement was evidently based on the reasoning in the decisions to which we have referred, including an appreciation of the unsatisfactory consequences which would flow from the adoption of the view that there is no power to fine in such cases. To those reasons we would add the comment that lying behind punishment for a contempt which involves wilful disobedience to a court order, is the very substantial purpose of disciplining the defendant and vindicating the authority of the court. In our view the reasons supporting the recent decisions are compelling and they should be accepted by this Court. It follows that a deliberate commission or omission which is in breach of an injunctive order or an undertaking will constitute such wilful disobedience unless it be casual, accidental or unintentional. It is immaterial that the existence of the power to impose a fine for wilful disobedience to a court order may not have been explicitly recognized in 1903." (foonote omitted)

52 The sentence from that passage to which I would draw particular attention is that which refers to a deliberate commission or omission in breach of an injunctive order constituting wilful disobedience unless it be casual, accidental or unintentional. It seems to me to be not insignificant that their Honours used the word "deliberate" to describe the commission or omission which will constitute a breach and also that their Honours defined "wilfulness" by reference to the absence of accident and the presence of intent.

53 I move then to the decision of the High Court in Witham v Holloway (supra). The circumstances of that decision are, I think, of some significance for the issue which has now arisen because the proceedings arose out of proceedings for contempt as a result of alleged contraventions of orders made in civil proceedings in the Supreme Court of New South Wales which took the form of a Mareva injunction and a requirement for a declaration of assets and liabilities.

54 In the joint judgment of Brennan, Deane, Toohey and Gaudron JJ, the Court observed at 527:

"The finding that the appellant breached the disclosure order was based on the understatement of his liabilities and the failure to disclose his ownership of a property which he had purchased about three months before swearing the affidavit. Overall, the affidavit indicated that the appellant was in a better financial position than, in fact, he was. The appellant gave evidence that the affidavit had been prepared by his solicitors and that he had not checked its contents carefully. In that context, his Honour held that he was 'satisfied on the balance of probabilities that the defendant showed at least recklessness in swearing the affidavit.'"

55 Thus the trial Judge had found that the affidavit was erroneous, and that finding does not appear to have been in contest.

56 The case turned upon the question of whether the trial judge had erred by applying the civil standard to the burden of proof of recklessness rather than the criminal standard and it was held that he was in error in so doing and the matter was remitted for rehearing.

57 Had it been the case that error in the affidavit would have been sufficient of itself to establish the contempt, then on the facts found at first instance, the issue determined by the High Court would have been moot. The issue as to the applicable standard of proof only arose in relation to the mental element required to make out a contempt in relation to the filing of the affidavit and in particular whether there had been recklessness in relation to that affidavit. If the plaintiff's submission in this case is correct, then it is difficult to see why the question of the standard of proof would have arisen at all in Witham v Holloway (supra).

58 In all events, the High Court held that all charges of contempt had to be proven beyond reasonable doubt and cast aspersions at the previous approach of the courts in segregating civil contempt from criminal contempt. Since that decision, it is now clear that the general principles of criminal law, including the burden and standard of proof, apply to all contempt proceedings however they may be categorised.

59 The last case to which I would refer is the decision of the Queensland Court of Appeal in Lade & Co Pty Ltd v Black [2006] QCA 294. This was a case in which contempt proceedings were brought essentially as a result of non-compliance with an order requiring a party to take the steps necessary to stop the trespass of cattle. There was a disagreement between the members of the Court of Appeal of Queensland as to the principles properly applied.

60 Jerrard JA was of the view that contempt would only be made out if the prosecutor established that the acts or omissions giving rise to the contempt had not been casual, accidental or unintentional and were wilful. He referred to the decision of Lord Nolan in the House of Lords in Director General of Fair Trading v Pioneer Concrete Ltd (UK) [1995] 1 AC 456 where at 479 - 480 Lord Nolan wrote, again referring to the view of Warrington J in Stancomb (supra):

"The view of Warrington J has thus acquired high authority. It is also the reasonable view, because the party in whose favour an order has been made is entitled to have it enforced, and also the effective administration of justice normally requires some penalty for disobedience to an order of a court if the disobedience is more than casual or accidental or unintentional."

61 Jerrard JA also referred to the decision of Atkinson J of the Supreme Court of Queensland in Bakir v Doueihi & Ors [2002] QSC 19 where her Honour observed:

"The breach of an order will not constitute contempt unless it is wilful and not casual, accidental or unintentional."

62 Jerrard JA adopted that statement. He went on to observe in [26] of his judgment:

"I consider it follows that a deliberate act or omission which is in fact in breach of an order will constitute contempt, and to prove contempt it is necessary and sufficient to prove that much. There will be no contempt proved if the act or omission is 'casual, accidental or unintentional'. The challenge in this case is in describing what constitutes a deliberate omission. Stirling J, and McMurdo P, have held that genuine and reasonable attempts to comply with an order are not a wilful omission, and that is consistent with Warrington J's conclusion that the defendant in Stancomb had done as much as could reasonably be required of them in cleaning the banks. I also note that Stirling J was quite prepared in Worthington v Ad-Lib to conclude that there had been a deliberate disregard of an order if no real trouble was taken to obey it. In this appeal the learned trial judge held that Mr Black could have done more, for example by improving the fence at the creek crossing or more actively repairing the fence, and had not been imbued with a sufficient sense of urgency." (footnote omitted)

63 Keane JA took a different view. In his view, the question of the mental element only arose at the point of determining whether or not punishment should be applied and, if so, what punishment. In his view, (at [63]):

"In my respectful opinion, if a party can be guilty of contempt by reason of disobedience of an undertaking due to the carelessness or neglect of an employee, then, a fortiori, a party is guilty of contempt where the breach of the order has been brought about by the party's own neglect of steps necessary to prevent the breach. There must, of course, be actual disobedience. There cannot be disobedience if the alleged contemnor does not know of the order which he or she is alleged to have breached. Nor could there be disobedience where the breach of the order occurs by reason of circumstances outside the control of the alleged contemnor. But if the facts of the case enable one fairly to conclude that the alleged contemnor has disobeyed the order or undertaking then that is sufficient to constitute a contempt. The question under the general law then was whether the circumstances of the disobedience were such as to warrant an order in the nature of a punishment as opposed to a vindication of the rights of the other party to the litigation."

64 Jones J specifically expressed the view that no specific mental element was required. He held at [109]:

"The proof of breach of an undertaking does not require any specific mental element. Any relief from this quasi-criminal liability on the part of a contemnor is found in the exculpatory provisions of 'casual, accident or unintentional'."

65 It seems clear that Jones J was of the view that the question of whether the events were casual, accidental or unintentional went to the question of liability, not merely to penalty. On the other hand, his Honour's description of the provisions as being exculpatory might suggest some change in the normal burden of proof. However, because his Honour does not enunciate such a proposition in relation to the burden of proof and because none of the other authorities appear to enunciate such a proposition, I would not infer such a proposition merely from the use of the term "exculpatory".

66 Digressing then to the general principles of criminal law which I take to be incorporated into these proceedings as a result of the decision in Witham (supra), there are of course some offences for which a specific intent is necessary. An example in this state, is the offence of wilful murder in respect of which the prosecution must prove a specific intent to kill. These are not proceedings in which proof of a specific intent is necessary. However, general principles relating to the mental element in criminal law will often require that before an accused person can be found guilty of an offence, the acts or omissions that are said to give rise to that offence must be undertaken with knowledge of the facts that give those acts or omissions their criminal quality. It is dangerous to embark upon descriptions that appear to be universal in this area. As the High Court has pointed out in the case of Bahri Kural v The Queen [1987] HCA 16; (1987) 162 CLR 502, offences are of many different kinds and the application of general principles to particular offences may produce different consequences. However, with that caution in mind, there are many offences for which knowledge of the facts that give an act or omission its criminal quality are an essential element of the offence. Examples include, offences such as possession of stolen goods. When such an offence is alleged, it is necessary for the prosecution to prove that the accused was aware that the goods were stolen, not merely that they were in his or her possession.

67 The same principle applies to allegations relating to possession or importation of illegal drugs. In cases of that kind, it is necessary for the prosecution to prove that a person alleged to have imported illegal drugs was aware that the substance they were importing were illegal drugs: see Bahri Kural (supra)

68 It seems, to me, that if this were a case being brought on indictment - and since Witham v Holloway (supra) I should treat the case essentially as if it were - the allegation would be to the effect that the defendant was guilty of having breached an order of the court by reason of filing an affidavit that had annexed to it a list of documents that did not list all the documents that were, or had been, in its possession, custody, power or control. The application of the general principles of the criminal law, to which I have referred, would require the prosecution to establish beyond a reasonable doubt that the defendant knew that the list did not contain or refer to all the documents that had been in its possession, custody, power or control at the time the affidavit was filed.

69 I have found that the prosecution has failed to establish that fact in this case. It follows that the motion must be dismissed.

70 If this view of the law is not correct, it seems to me to be clear on the authorities that the prosecutor must prove that the act or omission giving rise to the alleged contempt was not accidental or unintentional. I take that principle to apply to those aspects of the act or omission that give it the character of a contempt. In this case, I take that principle to require the prosecutor to prove beyond a reasonable doubt that the omissions from the list attached to the affidavit of 7 June 2006 were not accidental or unintentional. I have found as a fact that the prosecutor has failed to establish that fact to the requisite standard. For that reason also this motion must be dismissed.

71 In conclusion, I would again emphasise that this is not a case in which contempt by reason of failure to make adequate or diligent inquiry with respect to the contents of a list attached to an affidavit of discovery is alleged. If such a case had been brought, then quite different considerations may have applied.

72 I would also observe that because of my findings in respect of accident and lack of intent, had I come to a different conclusion with respect to the establishment of the contempt, I would have been strongly inclined to the view that this is one of those cases in which the court should not exercise its jurisdiction to adjudicate upon a contempt, in accordance with the discretion recognised and described by Steytler J in Temwood Holdings Pty Ltd v Oliver [1999] WASC 212.

73 In relation to costs, there is no dispute that costs should follow the event in the sense that the plaintiff should be ordered to pay the defendant's costs. However, a question has arisen as to the time from which those costs should be ordered, and in particular, it has been submitted that I should not order those costs to accrue until the affidavit of Mr Gough was filed, providing on oath an explanation for the circumstances that gave rise to the second affidavit. I do not accept that submission because it seems to me that the email exchange to which I have referred put the plaintiff on notice that the error had come about in the office of the defendant's solicitors.

74 On the view I take of the law, it was always incumbent upon the plaintiff to establish that there was a wilful breach on the part of the defendant, not its solicitors. It seems to me that by reason of the email exchanges to which I have referred, from a time in June 2006 prior to the commencement of the proceedings the plaintiff should have been on notice that it would be very difficult to establish that proposition given that the errors appeared to have occurred in the office of the defendant's solicitors. So for those reasons, the proper order is that the plaintiff should pay the defendant's costs of this motion. Those costs will be taxed, if not agreed.

INTERNATIONAL LAND DEVELOPMENTS PTY LTD -v- DIAMO NOMINEES PTY LTD [2007] WASC 96 (3 April 2007)

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INTERNATIONAL LAND DEVELOPMENTS PTY LTD -v- DIAMO NOMINEES PTY LTD [2007] WASC 96 (3 April 2007)

Cases Cited (3)