International Management Group of America Pty Ltd v Media Niugini Ltd t/as EMTV [2021] NSWSC 919 | Case summary

Supreme Court of NSW|2021-07-20|Before: Stevenson J

Solicitors: Marque Lawyers (Plaintiff/Respondent) Watson Mangioni Lawyers Pty Ltd (Defendant/Applicant) File Number(s): 2020/15141

Judgment

The plaintiff, International Management Group of America Pty Ltd ("IMGA") is incorporated in NSW. Its business involves the distribution of broadcasting rights, the management of sporting events and acting as a media and entertainment agent.
The defendant, Media Niugini Ltd trading as "EMTV", is a company incorporated in Papua New Guinea ("PNG"). It is the owner of a free-to-air television channel known as EMTV that broadcasts in PNG. It is also a provider of multimedia production services in PNG. I shall refer to it as "EMTV".
The background to this dispute is set out in my judgment of 13 May 2020. [1]
The matter is set down for hearing for three days commencing on 22 November 2021.
The matter for determination is EMTV's Notice of Motion of 25 May 2021 seeking to set aside a Notice to Produce served on it by IMGA on 5 May 2021.
The Notice to Produce seeks production of the documents concerning EMTV's financial position. I set out the terms of the Notice to Produce at [13] below.
In the proceedings, IMGA alleges (to simplify matters somewhat) that: 1. on 30 October 2017, it entered a contract with EMTV pursuant to which EMTV would purchase certain broadcasting rights in relation to a regional rugby league football competition known as the "Queensland Cup" at specified rates; 2. alternatively, that EMTV engaged in misleading or deceptive conduct for the purpose of s 18 of Australian Consumer Law [2] by representing that it would purchase such rights at those rates when it had no intention of doing so; and 3. alternatively, that from 30 October 2017, the parties held a common understanding that there was an agreement of the kind contended for by IMGA such that EMTV is now estopped from denying its obligation to pay for the broadcast rights at the rates contended for by IMGA.
EMTV denies these matters and contends that if, contrary to that denial, there was an agreement of the kind for which IMGA contends, EMTV was induced to enter into that agreement by representations made by IMGA which were themselves misleading or deceptive for the purpose of s 18 of the ACL.
Although the debate before me ranged more widely, my conclusion is that I can resolve EMTV's challenge to the Notice to Produce by reference to its unusual provenance, considerations arising from Practice Note SC Eq 11 and some infelicities in the drafting of the Notice to Produce.

The provenance of the Notice to Produce

On 18 December 2020, EMTV filed a Notice of Motion seeking orders that its legal representatives be released from certain undertakings as to confidentiality.
In support of that application, EMTV adduced evidence from Ms Michaela Smith, a solicitor employed by EMTV's solicitors. Ms Smith deposed that she was informed by officers of EMTV that "the outcome of these proceedings has the potential to affect the financial viability of EMTV" and that, for that reason, it was in EMTV's best interests for the information the subject of the confidentiality undertaking to be disclosed to members of the EMTV board.
EMTV's motion was fixed for hearing on 16 April 2021.
On 14 April 2021, shortly before the date set for the hearing of EMTV's motion, IMGA served on it a Notice to Produce seeking: "1. Copies of all documents: (a) dated, created, sent or received [between 19 June 2020 and 13 April 2021]; and (b) which record or constitute communications between Sheena Hughes, Noel Kera and/or each member of the EMTV Board in respect of the financial viability of EMTV, as referred to at paragraph 17 of the Affidavit of Michaela Smith, sworn 12 April 2021. 2. All documents constituting: (a) audited and unaudited financial statements and annual reports for the past three financial years; and (b) balance sheets, profit and loss statements, cash flow statements and any solvency report provided to the EMTV Board, created from 1 January 2021 to date. 3. All documents which record or evidence any financial support provided to the Defendant for the past three financial years by any of: (a) Telikom PNG Limited; (b) the Government of Papua New Guinea; or (c) EMTV's holding company or ultimate holding company or other related entity."
Evidently, the Notice to Produce was designed to elicit production of documents relevant to the evidence of Ms Smith set out at [11] above.
During a directions hearing before Hammerschlag J on 16 April 2021, the dispute concerning EMTV's legal representatives' undertakings as to confidentiality was resolved, more or less consensually, on the basis that the undertakings would be varied.
IMGA did not call on the 14 April 2021 Notice to Produce.
Also on 16 April 2021, Hammerschlag J gave EMTV leave to file an Amended Cross-Claim and made directions for the exchange of further evidence.
On 5 May 2021, IMGA served on EMTV the Notice to Produce the subject of this application, which is in exactly the same terms as that served on 14 April 2021, under cover of an email that read: "Please see attached, by way of service. This is the same Notice to Produce which was previously filed, however it has been refiled due to an administrative error".
I was not given an explanation of what the "administrative error" was said to be.

Practice Note SC Eq 11

Practice Note SC Eq 11 does not, in terms apply to Notices to Produce. However, as should now be well known, the Court will regard using a Notice to Produce as a means, in effect, to obtain disclosure of documents as a subversion of the Practice Note's intended operation and possibly an abuse of process. [3]
As I have said, the Notice to Produce that IMGA served on EMTV on 5 May 2021 is in exactly the same terms as the Notice to Produce of 14 April 2021.
As at 5 May 2021, the parties had not served all their evidence as the directions made by Hammerschlag J on 16 April 2021 had not yet been complied with. Indeed, orders were made by consent on 11 May 2021, extending the time for compliance with those directions.
As at 5 May 2021, IMGA would not have been able to obtain disclosure of documents from EMTV without showing "exceptional circumstances" for the purposes of Practice Note SC Eq 11. In my opinion, it should not be placed in a better position by reason of having served a Notice to Produce rather than seeking disclosure.

A further problem

As set out in my judgment of 13 May 2020, the critical events relevant to these proceedings occurred between October 2017 and February 2018.
The Notice to Produce seeks documents relevant to EMTV's financial position between 19 June 2020 and 13 April 2021 (par 1) and "for the past three financial years" (pars 2 and 3).
Mr O'Brien, who appeared for IMGA, accepted that the Notice to Produce had been drafted on the basis of a misapprehension on the part of those advising IMGA that "the past three financial years" so far as concerns EMTV were the years ended 30 June 2018, 30 June 2019 and 30 June 2020.
That is not the case. The former Chief Executive Officer of EMTV, Mr Matthew Park deposed in an affidavit affirmed on 15 October 2020 (that IMGA tendered on this application) that "[t]he financial year in PNG is the same as the calendar year ending 31 December each year".
Thus, the Notice to Produce does not call for any documents prior to 1 January 2018, including between October and December 2017 when most of the critical events giving rise to IMGA's claim occurred.
Thus, assuming that EMTV's financial position is a matter of "apparent relevance to the issues in the case" [4] the Notice to Produce will not capture documents relevant to EMTV's financial position during the critical period. It is thus of limited utility and almost certainly will not finally resolve IMGA's quest for documents of this nature. That quest should, in any event, be pursued at the appropriate time.
It may be that documents relevant to later periods might shed some light on those matters, but that is really a matter of speculation.

Conclusion

In all these circumstances, my conclusion is that the Notice to Produce should be set aside.
I order that the Notice to Produce filed on 5 May 2021 be set aside.
I order that the plaintiff pay the defendant's costs of the defendant's Notice of Motion of 25 May 2021.

Endnotes

International Management Group of America Pty Ltd v Media Niugini Ltd t/as EMTV [2020] NSWSC 559.
Competition and Consumer Act 2010 (Cth), Sch 2 - Australian Consumer Law ('ACL').
For example, The Owners Strata Plan 69567 v Baseline Constructions Pty Ltd [2012] NSWSC 502 at [23]-[24] (Stevenson J) and Broadway Plaza Investments Pty Ltd v Broadway Plaza Pty Ltd [2019] NSWSC 410 at [132] (Ward CJ in Eq).
Secretary of Department of Planning, Industry and Environment v Blacktown City Council [2021] NSWCA 145 at [80] (Bell P).

Amendments 28 July 2021 - [29] Typographical error corrected DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 28 July 2021

International Management Group of America Pty Ltd v Media Niugini Ltd t/as EMTV

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