Use of the Tedford Reports
6 The first step in the present application concerns the fact that Mr King proceeded to use the Tedford Reports in the US Adversary Proceeding without first obtaining the leave of this Court. He did so in the course of resisting Linkage's motion to set aside the default orders in that proceeding. As part of his response to that motion Mr King wished to submit that the behaviour of Linkage in the Australian proceeding had constituted a bad faith attempt to manipulate the legal system. He cited - but did not actually quote from - the Tedford Reports as part of that argument. This use occurred in a document filed on his behalf in the US Adversary Proceeding entitled 'Omnibus Response to Linkage Access Limited's and New Target Investment Limited's Motions to Set Aside Entries of Default' ('Omnibus Response'). The relevant paragraphs were [44]-[46]:
Indeed, just 36 hours before January 31st hearing regarding the continuation of the Injunction, Linkage submitted over 150 pages of pleadings and affidavits to the Australian Court, including the Tedford Affidavits, to argue the Injunction should immediately lifted because it would take over 28 months to serve all of the Adversary Proceeding defendants, 4 to 6 years to try the merits raised in the Complaint, and cause the Debtors' estates to expend substantial attorneys' fees. In its submissions, Mr. Tedford assumed that the Defendants had not appointed to represent them in the Adversary Proceeding and that service had not been made.
It was only after the Defendants' failed in their attempt to obtain a discharge of the Injunction at the January 31st hearing did New Target and Linkage authorize K&L Gates to act as their counsel in this Adversary proceeding, on February 5, 2019, and accept service on their behalf.
The above facts betray the Defendants' bad faith motive to seek delay and drive up the costs of litigation for the Trustee, and evidence a clear desire to interfere with judicial decision-making and manipulate the legal process.
(errors in original)
7 So it is clear that the Tedford Reports must have been used in the preparation of the Omnibus Response. In addition to that use, the Omnibus Response was itself uploaded to the internet after it had been placed on the Court file. However, that does not appear to involve any more use of the Tedford Reports than had already occurred by the filing of the Omnibus Response. This is so because the Tedford Reports were not themselves set out in the Omnibus Response.
8 Linkage submits that this evidence shows that Mr King has breached the obligation not to use documents produced in litigation for extraneous purposes without first obtaining the Court's leave. The obligation was explained in Hearne v Street [2008] HCA 36; 235 CLR 125 ('Hearne v Street') at 154-155 [96] per Hayne, Heydon and Crennan JJ in these terms:
Where one party to litigation is compelled, either by reason of a rule of court, or by reason of a specific order of the court, or otherwise, to disclose documents or information, the party obtaining the disclosure cannot, without the leave of the court, use it for any purpose other than that for which it was given unless it is received into evidence. The types of material disclosed to which this principle applies include documents inspected after discovery, answers to interrogatories, documents produced on subpoena, documents produced for the purposes of taxation of costs, documents produced pursuant to a direction from an arbitrator, documents seized pursuant to an Anton Piller order, witness statements served pursuant to a judicial direction and affidavits.
9 As I have already noted, there was no order of this Court which required, ordered or directed Linkage to file the Tedford Reports. This might suggest that that their filing was not the result of compulsion but is to be seen as voluntary and, therefore, falling outside the principle in Hearne v Street. Linkage, however, submitted that this was not so. It drew attention to a portion in the passage set out above in Hearne v Street where the Court referred to documents that a party was 'compelled either by reason of a rule of court, or by reason of a specific order of the court, or otherwise' (emphasis added). It submitted that the words 'or otherwise' meant that the Hearne v Street obligation could apply to material which was filed with a court even without an explicit court order requiring that filing.
10 I accept that submission. It has been held that where a party at the request of an opposing party produces a document for the purposes of a proceeding then the implied undertaking attaches to that document. In such cases, were the request to be refused the opposing party would be able to issue a notice to produce or subpoena or otherwise to compel production. It would be anomalous that a document produced in such circumstances were treated as if it had been produced other than under compulsion. As such, the principle extends not only to those cases where the document is actually compulsorily produced under a court rule or a court order but also to those situations where a document is produced in response to a request for production which is clearly made as a practical suggestion to avoid the invocation of the court's compulsory processes. This is true as a matter of analysis for the production is not really voluntary but instead is to be seen as having been made under a species of lawful duress, namely, the lawful implied threat of compulsory production. It is also true as a matter of policy for to hold otherwise would be to create an unwholesome incentive for parties to litigation not to co-operate and instead to insist on the requesting party to issue a notice to produce or invoking some other formal means of compulsory production. In an age where the curial fashion is to encourage co-operation between parties and the efficient use of court resources, such an approach would be hard to justify. Examples of the implied undertaking being extended to situations where production is given in response to a request being made by the opposing party against a backdrop of a possible application for compulsory production include Bourns Inc v Raychem Corp [1999] 3 All ER 154 at 170 per Aldous LJ (Sir Stephen Brown P and Swinton Thomas LJ agreeing) and Helicopter Aerial Surveys Pty Ltd v Robertson [2015] NSWSC 2104 at [17] per Brereton J.
11 However, that is not what happened in this case. Mr King did not request Linkage to produce the Tedford Reports to it and, in filing them, Linkage was not behaving practically so as to avoid the invocation by Mr King of some compulsory process aimed at requiring their production. This principle therefore does not apply.
12 There is also authority for the proposition that where a party files an affidavit pursuant to a court order that any evidence relied upon by that party be filed by a certain date, then the implied undertaking applies to any affidavit so filed: Laen Pty Ltd v At the Heads Pty Ltd [2011] VSC 315 ('Laen') at [8] per Davies J. That reasoning is consistent with the New South Wales Court of Appeal's decision in Akins v Abigroup Ltd (1998) 43 NSWLR 539 ('Akins') at 551-552 where Mason P (with whom the other members of the Court agreed) concluded that statements filed pursuant to a direction requiring their filing by a particular time were to be treated as if they had been compulsorily produced. There the question was not whether the implied undertaking applied but rather whether legal professional privilege had been waived in the statements. For myself, I have always had doubts about this aspect of Akins. An alternative view is that the decision to file was voluntary and the party's autonomy was circumscribed only to the extent that the choice of when the statements were to be filed was regulated. Other courts, including the Full Court of this Court, have expressed some doubt about this aspect of the reasoning in Akins: Liberty Funding Pty Ltd v Phoenix Capital Ltd [2005] FCAFC 3; 218 ALR 283 ('Liberty Funding') at 288-289 [24]. I have similar doubts in relation to the application of this principle in the context of the implied undertaking (cf Hearne v Street at 131 [5] per Gleeson CJ).
13 However, it is not necessary to explore those doubts further. Even accepting the principle for which Laen stands, it does not assist Linkage. There is no order in this case which required it to file any evidence by any date. In fact, there was simply no order at all. Laen does not apply.
14 This forced Linkage then to argue that the principle should be extended to cover the current situation. It did so in two ways. First, it noted that ordinarily it is likely that there would have been a timetable for evidence requiring Linkage to file its evidence by a particular time. If such an order had been made then the principle in Laen would have applied and the implied undertaking would have attached to the Tedford Reports. It was only because the matter was moving along in a hurry that no such timetable had been put in place. It was anomalous that the question of whether the implied undertaking attached should be seen as a function purely of happenstance. Secondly, the situation was not really different to Laen because in that case too there was no compulsion since the party could have chosen not to file the affidavits.
15 I do not accept either of these arguments. The absence of a court order makes all the difference to the first argument. Linkage did not have to file the Tedford Reports and there was not the slightest legal obligation on it to do so. In fact, the most recent orders of 12 December 2018 had timetabled the filing of Linkage's mooted recusal application rather than the filing of expert evidence. It cannot be said, in that circumstance, that it acted under compulsion for it did not. As the second argument, whilst I agree that Linkage's submission underscores what appears to me to be a defect in the reasoning in Akins (and Laen), I do not accept that I should read Laen as expressing a wider principle. Any such wider principle would, in effect, be to the effect that any document filed by a party because it wishes to use it in the litigation is subject to the implied undertaking. The principle so widely stated would be contrary to the essential requirement that production be compulsory. In such a form, the concept of compulsion would be watered down to nothing.
16 The Tedford Reports were not subject to the implied undertaking having been produced voluntarily.