Court of Appeal (WA)|2002-04-09|Before: Mr P, Adam P, McLure J, Anderson J, Lure J

Novotny & Anor v Todd [2002] WASCA 79 (9 April 2002)

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

CITATION : NOVOTNY & ANOR -v- TODD [2002] WASCA 79

Practice and procedure - Taking of evidence abroad - Evidence solely directed at matters going to admissibility of documents - Whether within the scope of s 110 of the Evidence Act - Whether letters of request sought discovery - Whether materiality of evidence established

Evidence (Proceedings in other Jurisdictions) Act 1975 (UK), s 2

s 114, s 117(3) and (4)

Appeal allowed and respondent's application for letters of request dismissed

Georgini v Electric Power Transmission Pty Ltd [1963] NSWR 258

Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc [1981] HCA 39; (1981) 148 CLR 170

1 ANDERSON J: I agree with McLure J that leave to appeal should be granted, the appeal allowed and the respondent's application for issue of letters rogatory dismissed. My reasons for so concluding are slightly different from those expressed by McLure J, but I can state them briefly. They are as follows.

2 In my opinion, it is quite clear that the object of the respondent's application for the issue of letters of request is to obtain third party discovery from the three foreign companies concerned. However they may be dressed up, that is the purpose of the letters of request. In substance, the orders made pursuant to the letters of request would be nothing more than orders duces tecum. That this is their purpose is to be inferred from the way in which the proposed witnesses are described ("the proper officer of ... "), the generalised description and very large number and diversity of the documents which the witnesses would be ordered to bring with them to the Supreme Court of British Columbia, the lack of particulars or evidence as to the existence and materiality of the enumerated documents and the complete absence of information on which this Court could conclude that the proposed witnesses have anything worthwhile to say about the issues joined on the pleadings.

3 It is one thing to say that the proper officer of a company can be summonsed to produce the company's documents. It is another thing to say that the proper officer can give admissible evidence probative of a matter in issue. To have the capacity to say on oath that the documents belong to the company, form part of its records or are produced from the company's possession is to have the capacity to do no more than to give discovery of them and produce them for inspection. It is, I think, beside the point that, in respect to some of these documents, this may be a necessary step in order to have the documents admitted into evidence. The point is that all that any of the three proper officers could do in this case, prima facie at any rate, is to hand over the documents as documents belonging to the company. For all that appears, none of the persons who presently satisfy the description "proper officer" was an officer of the company at any material time, or has any personal knowledge touching any matter in issue.

4 Although I agree that the terms of the letters of request in this case are different from those which were applied for in Elna Australia Pty Ltd v International Computers (Australia) Pty Ltd (1987) 74 ALR 232, the respondent in this case is seeking to achieve no more than the applicant in that case. This is not a permissible use of the power to order that letters of

request issue pursuant to s 110 of the Evidence Act 1906: Elna Australia Pty Ltd v International Computers (Australia) Pty Ltd (supra) at 235 - 6.

5 As to the question of serious injustice, the issue of the letters of request and the making of the orders which they request would inevitably involve the appellants in substantial cost and inconvenience which the appellants should not have to face. In addition, the respondent will obtain a forensic advantage in these adversary proceedings to which he is not entitled.

6 In my opinion, that is a sufficient reason not to leave the decision unreversed according to the tests laid down in Wilson v Metaxas [1989] WAR 285 at 294 and Western Australia v Bond Corporation Holdings Ltd (1991) 5 WAR 40 at 54 - 57.

7 McLURE J: This matter comes before the Court pursuant to O 63A of the Supreme Court Rules ("Rules"). The applicants (defendants) seek leave to appeal and to appeal from orders made by Master Sanderson on the respondents application dated 14 February 2001 for the issue of letters of request under s 110(1)(c) of the Evidence Act 1906 and O 38A of the Rules. The respondent sought orders that letters of request issue to the Supreme Court of British Columbia, Canada, for the examination and production of documents by the Proper Officer of three Canadian corporations, Nexttrip.com Travel Corporation ("Nexttrip"), Computershare Investor Services Inc ("Computershare"), and Canaccord Capital Corporation ("Canaccord").

8 On 30 October 2001 Master Sanderson made orders in terms of the respondent's chambers summons. However, on 7 November 2001 Master Sanderson recalled the orders made on 30 October 2001 and made further orders in the same terms in relation to amended letters of request annexed to the orders.

9 At the commencement of the hearing, counsel for the applicants applied for leave to amend the draft notice of appeal contained in the appeal book. That draft notice of appeal related to the orders made in October 2001 which were subsequently recalled. The proposed amended notice of appeal related to the orders made on 7 November 2001. Leave to amend was granted.

10 The applicants' contended that the learned Master erred in granting the orders for the issue of the letters of request on the grounds that:

(a) the sole or predominant purpose of the application was to enable the respondent to obtain discovery of documents from third parties or to undertake a fishing expedition in relation to documents held by the intended examinees; and

(b) there was no or no sufficient evidence before the learned Master that the intended examinees could give evidence material to any issue to be tried in the proceedings.

11 As a preliminary matter the applicants contended that the principles governing the exercise of the discretion to grant leave to appeal pursuant to s 60(1)(f) of the Supreme Court Act do not apply to fast-track appeals under O 63A. I see no justification in the language of the Rules or in principle for that contention. In an application for leave under O 63A of the Rules, even when heard together with the appeal, the Court must in general be satisfied that the decision below is attended with sufficient doubt to justify the grant of leave and that a substantial injustice would be done if it remained unreversed: Wilson v Metaxas [1989] WAR 285 at 294.

12 Before considering the questions that arise for consideration, it is necessary to refer to the respondent's claims against the applicants and the terms of the letters of request. The pleadings were not in the appeal books. However, each of the letters of request contain identical information on the nature of the proceedings, the relief sought, a summary of the alleged facts and the parties' contentions. This information is supplemented by the learned Master's statement of the relevant facts.

13 The proceedings arise from an alleged agreement between the respondent and the first named applicant (Michael Novotny) said to give rise to mutual fiduciary duties. The respondent also contends that the second named applicant ("Backload") knowingly assisted Mr Novotny in breaching the agreement and the fiduciary duties owed to the respondent. The respondent seeks, inter alia, equitable damages and compensation and an account of profits.

14 In particular, the respondent contends that the agreement concerned the acquisition of mineral interests in Indonesia which had been held by a company in which the respondent had an interest called Canadian Equatorial Exploration Mining Co Ltd and which were ultimately acquired by a company called South Pacific Resources Corp ("SPR") and an Indonesian mining property known as "Pleihari". Pleihari was also held by Canadian Equatorial through a British Virgin Islands company known as Golden Gauntlet Resources Ltd ("Golden Gauntlet") and was ultimately acquired by Borneo Gold Corporation ("Borneo Gold"). Borneo Gold is now known as Nexttrip and is listed on the Vancouver Stock Exchange in Canada.

15 SPR is listed on the Alberta Stock Exchange and is now known as Lexical Investment Corp. The respondent alleges that Mr Novotny breached his fiduciary duties in connection with SPR in the following ways:

(a) by entering into an agreement with SPR to receive some 230,000 fully paid shares in SPR at an issue price of C$1.50 each, which shares were issued without the plaintiff's knowledge or consent and were subsequently wholly or partially sold by Mr Novotny;

(b) by entering into an indemnity agreement with others whereby Mr Novotny indemnified SPR in respect of an obligation owed by SPR to pay the respondent the sum of US$250,000;

16 It is alleged that by failing to disclose the abovementioned matters the respondent lost a number of commercial opportunities. It is said that the respondent had commenced litigation against SPR which he settled without knowing those matters, which settlement resulted in a dramatic increase in SPR's share price and the respondent transferring, free of consideration, his interest in Canadian Equatorial.

17 As to Pleihari, it is said that the respondent believes that Borneo Gold acquired the Pleihari mining property in December 1995 by acquiring all of the outstanding shares in a Panamanian company called Indogold Corporation ("Indogold"). Indogold was owned by another Panamanian private company, Eurocar International Corp ("Eurocar"). Indogold is believed to own 90 per cent of Pleihari. The respondent, although a director and shareholder of Golden Gauntlet did not know or consent to the transfer of Pleihari. The respondent contends that Mr Novotny breached his duties to the respondent by failing to inform the respondent or obtain his consent to the transfer of Pleihari by Golden Gauntlet to Indogold. It is said that the value of Borneo Gold's shares went from $2.00 to something over $11.00 largely as a result of it acquiring control of Pleihari. It is also said that Mr Novotny received 210,000 options over Borneo Gold shares in two tranches of 160,000 and 50,000.

18 One of the letters of request is directed to the Proper Officer of Computershare. Computershare, formerly known as the Montreal Trust Company, was the share registry for SPR and Nexttrip. Paragraph 5 of each letter of request is in the following terms:

"I respectfully request that, subject to the following, the evidence be taken in a manner directed by the Commissioner, with leave to apply to the Supreme Court of British Columbia for directions:

(a) The person shall be required to attend for examination on oath as such time and place as the Commissioner may direct.

(b) The person shall be required to produce the classes of documents specified in the schedule attached hereto (the Documents) in his possession in his capacity as an officer of the named corporation, and to authenticate and identify the Documents.

(c) The Commissioner give directions for the production of documents to the solicitors for the parties prior to the taking of evidence."

19 The schedule of documents attached to the Computershare letter request includes the following:

1. Nexttrip's share register and register of members;

2. documents relating to the issue of shares, options, share warrants or other negotiable securities in Nexttrip to or at the direction of either of the applicants;

3. documents relating to the exercise by or on behalf of Mr Novotny of 160,000 options in Nexttrip;

4. documents relating to the transfer or other disposition or any negotiable security in Nexttrip by the applicants;

5. documents relating to the transfer of shares or other negotiable securities in Nexttrip to Eurocar;

6. documents relating to the transfer or other disposition by Eurocar of any negotiable security in Nexttrip;

7. documents relating to the distribution of 10 million common shares in Nexttrip issued to Eurocar;

8. documents relating to the issue of shares or other negotiable securities in Nexttrip to any of six specified entities;

9. documents relating to a pooling agreement under which shares and share warrants in Nexttrip held by Eurocar were deposited with Montreal Trust company.

20 The schedule of documents attached to the letter of request to the Proper Officer of Nexttrip is eight and half pages and covers a wide variety of subject matters, including inter alia, the removal of the Pleihari property from Golden Gauntlet, Nexttrip's proposed acquisition of Pleihari and documents relating to Indogold and Eurocar.

21 Canaccord is a Canadian stockbroker. The schedule of documents attached to the letter of request to the Proper Officer of Canaccord include:

1. all documents relating to any dealing by Mr Novotny in shares, options, share warrants or other negotiable securities in Lexacal, Eurocar, Indogold or Nexttrip in the period 1 January 1995 to 30 June 2000 ("the period").

2. documents relating to payments made by Mr Novotny to C M Oliver or Canaccord in the period.

3. documents relating to payments made by C M Oliver or Canaccord to Novotny in the period.

4. documents relating to payments made by Backload to C M Oliver or Canaccord in the period.

5. documents relating to any payments made by C M Oliver or Canaccord to Backload during the period.

6. documents relating to any sum held upon trust for or to the account of Novotny or Backload in the period.

22 The respondent's application was supported by affidavits of Gary Cobby affirmed on 27 February 2001 and 28 September 2001. The applications for the letters of request were preceded by letters from the respondent's solicitors to the Canaccord, Nexttrip and Computershare requesting, in effect, third party discovery of specified documents. The documents specified are similar to the documents the subject of the schedules to the letters of request. The respondent's solicitors foreshadowed that in the event the documents were not provided the respondents would apply to the Court for the issue of a letter of request to the Supreme Court of British Columbia requiring them to attend before that Court to be examined on oath on matters in question in the action and to produce and authenticate specified documents.

23 Mr Cobby's February affidavit refers to the relevance of the documents requested from Computershare in the following terms:

"15. The issues of fact in these proceedings to which the documents referred to ... relate include:

(a) the manner in which 230,000 shares in South Pacific Resources Inc came to be issued to the defendants;

(b) whether the first or second defendant received a benefit (in the form of negotiable securities) from Borneo Gold Corporation (now Nexttrip) in relation to or as a result of the acquisition of the Pleihari ... Contract Work by Indogold Corporation (which became a wholly owned subsidiary of Borneo Gold);

(c) the terms of which 160,000 options in Borneo Gold were issued to the first defendant and why those options were issued (the first defendant having denied all knowledge of their issue);

(d) whether the first defendant has exercised those 160,000 options.

16. Further, the relief claimed by the plaintiff in these proceedings includes a claim for an account of all benefits received by the defendants in relation to the conduct alleged in the plaintiff's amended statement of claim. The classes of documents referred to ... are relevant to that account.

17. By reason of the foregoing, I believe that the proper officer of Computershare Investor Services Inc is likely to be able to give evidence relevant to the issues in these proceedings."

24 The same evidence is given in relation to Canaccord. Mr Cobby does not give any detailed evidence concerning the relevance of the documents requested from Nexttrip.

25 In response to the applicants' submissions that the respondent had failed to establish that the person named in the letters would be able to give evidence material to any issue to be tried in the proceedings the learned Master said (at pars 11 and 12 of his reasons):

"It is important in considering this question to look carefully at what the plaintiff is attempting to achieve. This can be illustrated by referring to the plaintiff's claim that the defendants were issued with 230,000 shares in South Pacific Resources. If that transaction occurred, Computershare Investor records will show as much. If Computershare was resident in the jurisdiction, the plaintiff would, no doubt, issued a subpoena returnable before trial. If the relevant documents exist, then they would be produced in answer to the subpoena. But that does not assist the plaintiff in proving his case. To establish the fact of the issue of the shares, the plaintiff must somehow get the records before the courts. That would be done using s 79C of the Evidence Act 1906. Subsection (1) of that section requires production of the documents by a person having knowledge of the matters dealt with in the documents and it requires that person to be called as a witness. That is precisely the end to which these letters are directed.

It is important to note that the reference in the subsection is to evidence which is 'material'. That does not mean that an applicant must establish that the evidence will support his or her case. Evidence that is 'material' may, in fact, have the effect of destroying the plaintiff's case. With respect, submissions put on behalf of the defendants were to the effect that the plaintiff had to establish that the evidence supported his case before it could be regarded as being material. That is not what the subsection says. I am satisfied that the person named in each of these letters will be able to give evidence material to issues to be tried in these proceedings."

26 Insofar as the learned Master suggests that s 79C(1) requires documents to be produced by a person with knowledge of their contents, that is not correct: Connell v The Queen (No 6) (1994) 12 WAR 133. In response to the applicants' submissions that the letters of request ought not issue because, properly considered, they were an attempt to obtain discovery from parties outside the jurisdiction the learned Master said (at par 15 of his reasons):

"There is also no doubt that letters rogatory cannot be used solely for the purposes of discovery: see Elna Australia Pty Ltd v International Computers (Australia) Pty Ltd (1987) 74 ALR 232 per Gummow J at 235-236. Nor can the letters be used to identify persons who may be able to give evidence material to an issue to be tried in the proceeding: See Allstate Life Insurance Co & Ors v Australia & New Zealand Banking Group Ltd & Ors (No 18) (1995) 133 ALR 667 per Lindgren J at 675. But whatever may have been the position taken by the plaintiff's solicitors in correspondence, the application makes it plain that the letters are directed at particular witnesses who, as I have already concluded, would be able to provide evidence material to the issues between the parties. I am not satisfied that the application can be regarded as an exercise in discovery or as merely fishing."

27 He concluded by saying that in his view, the interests of justice favoured the granting of an order in terms of the chamber summons.

28 Sections 109 to 114 of the Evidence Act deal with the examination of witnesses outside the State. They were inserted by the Evidence Amendment Act No 66 of 1987 ("Amendment Act"). Section 110(1)(c) of the Evidence Act provides:

"(1) In any civil or criminal proceedings before a superior court, the court may, in its discretion and where it appears in the interests of justice to do so, on the application of a party to the proceeding, make, in relation to a person outside the State, an order -

(c ) for the issue of a letter of request to the judicial authorities of a place outside the State to take, or to cause to be taken, the evidence of the person."

29 Subsection 2 of s 110 sets out matters which the Court is required to have regard in the exercise of its discretion. It provides:

"(2) In determining whether it is in the interests of justice to make an order under subsection (1) in relation to the taking of evidence of a person, the matters to which the court shall have regard include the following-

(a) whether the person is willing or able to come to Western Australia to give evidence in the proceeding;

(b) whether the person will be able to give evidence material to any issue to be tried in the proceeding;

(c) whether, having regard to the interests of the parties to the proceeding, justice will be better served by granting or refusing the order."

30 The factors in s 110(2) are not conditions precedent to the exercise of the discretion to issue letters of request. They are considerations which must be taken into account and which, in the ordinary course, would be expected to be given considerable weight in the exercise of the Court's discretion.

31 Section 110(4) gives the courts additional powers when it has made an order under subsection (1)(c) of s 110. Subsection (4) materially provides:

"(4) Where a court makes, in relation to a proceeding, an order under subsection (1) of the kind referred to in subsection (1)(c) in relation to the taking of evidence of a person, the court may, in its discretion, include in the order a request as to any matter relating to the taking of that evidence, including any of the following matters -

(a) the examination, cross-examination or re-examination of the person, whether the evidence of the person is given orally, upon affidavit or otherwise;

(b) the attendance of the legal representative of each party to the proceeding and the participation of those persons in the examination in appropriate circumstances;

(c) any prescribed matter."

32 No additional matters have been prescribed. Subsections 5, 6 and 7 of s 110 deal with the circumstances in which the evidence of a person taken in an examination held as a result of an order made under subsection (1) can be tendered in evidence in the proceedings in Western Australia. Under s 110(8)(a), a reference to evidence taken in an examination includes a reference to a document produced at the examination.

33 As is made clear in the Minister's Second Reading Speech relating to the Amendment Act, ss 109 to 114 are part of a scheme of uniform law enacted throughout Australia for the taking of evidence outside Australia. The Minister said:

"The Bill will allow the obtaining of evidence, both oral and documentary, for use in the State court."

34 The law of the Commonwealth on this topic is now contained in Pt 2 of the Foreign Evidence Act 1994. It is in substantially similar terms to the Western Australian legislation.

35 As the documents the subject of the letters of request are company documents, the letters of request are correctly characterised as being addressed to the corporations. A question which was not addressed by the parties is whether a company can be required to attend by its proper officer, to give oral evidence. Under English law, that question has been answered in the negative: Penn-Texas Corporation v Murat Anstalt [1964] 1 QB 40. However, the Court of Appeal in that case also held that a company can be required, by its proper officer, to produce company documents. The case concerned the construction of s 1 of the Foreign Tribunals Evidence Act 1856 (UK) which gave the court the power, at the request of a court of a foreign country, to "command the attendance of any person to be named in such order, for the purpose of being examined, or for the production of any writings or other documents to be mentioned in such order, ...".

36 In Penn-Texas Corporation v Murat Anstalt (No 2) [1964] 2 QB 647 the correctness of the second of the Court's conclusions in Penn-Texas (No 1) relating to the production of documents was unsuccessfully challenged. However, in the course of affirming the existence of the power to make such an order, Lord Denning MR stated that a corporation could give evidence by its proper officer. Lord Denning examined the history of the procedure under a subpoena duces tecum and concluded that a person responding to the subpoena could be sworn for the limited purpose of giving evidence as to their possession or custody of the documents the subject of the subpoena. Stephen J in Smorgon v Australia and New Zealand Banking Group Ltd [1976] HCA 53; (1976) 134 CLR 475 at 484 regarded the issue as settled by Penn-Texas (No 1) which reflected his own "uninstructed opinion" which was that a company could not give evidence by its proper officer.

37 The Penn-Texas cases were again referred to by the High Court in Rochfort v Trade Practices Commission [1982] HCA 66; (1982) 153 CLR 134. In that case the High Court was considering whether an officer of an unincorporated association was required to produce documents in answer to a subpoena. Mason J (at p 146) referred to the judgment of Lord Denning in Penn-Texas (No 2) with approval.

38 The limits on this Court's power to respond to a request from a foreign court is, or may be, a relevant consideration in framing requests to a foreign court. However, as these matters were not argued by the parties I will assume in the respondent's favour that a company can be compelled to attend, by its proper officer, to give oral evidence.

39 Further, both parties appeared to accept the correctness of the conclusion of Gummow J in Elna Australia Pty Ltd v International Computers (Australia) Pty Ltd (1987) 74 ALR 232 that the court has no inherent jurisdiction to make an order requesting the production of documents. That question was considered by the Vice-Chancellor, Sir Donald Nicholls in Panayiotou v Sony Music Entertainment (UK) Ltd (1994) Ch 142. He held that the English High Court had the power to issue a letter of request to the court of another country for assistance in obtaining the production of a document as evidence in an action pursuant to the inherent jurisdiction of the court. However, he concluded that the inherent jurisdiction was confined to a request for a particular document which is admissible in evidence, directly material to an issue in the action and which the court is satisfied exists or is likely to exist. These limitations appear to flow, as a matter of comity, from the limitations on the English court's powers to order production of documents at the request of a foreign court. In 1994 the power of an English court to respond to an incoming letter of request was contained in s 2 of the Evidence (Proceedings in other Jurisdictions) Act 1975. That section gave the court the power to order the production of documents. However, s 2(4) provided that:

"An order under this section shall not require a person -

(a) to state what documents relevant to the proceedings to which the application for the order relates are or have been in his possession, custody or power; or

(b) to produce any documents other than particular documents specified in the order as being documents appearing to the court making the order to be, or to be likely to be, in his possession, custody or power."

40 The power of this Court to order the production of documents at the request of a foreign court is in the same terms as the English legislation: see s 117(3) and (4) of the Evidence Act. The English court's decision on inherent jurisdiction has to be seen in the context of the results flowing from the Penn-Texas cases. The court in Panayiotou described the conundrum in these terms (at p 147):

" ... an order to produce a company's documents cannot be directed to an individual; the order must be directed at the company. But an order to produce documents pursuant to a letter of request can only be ancillary to an order to attend for examination, and such an order does not lie against a company".

41 As it was not suggested by any party that the Court has inherent jurisdiction to order the production of documents I will assume it does not.

42 The applicants' primary contention is that the respondent used the letter of request procedure for the improper purpose of obtaining discovery of documents from third parties. That contention is linked with the submission that the evidence in support of the application for the letters of request did not establish the necessary connection between the proposed evidence, oral and documentary, and the issues to be tried in the proceedings.

43 It is clear from the statutory language that s 110 of the Evidence Act does not give the court jurisdiction to request foreign judicial authorities to order third party discovery of documents or to issue the foreign equivalent of a subpoena duces tecum. Those procedures do not in the ordinary course involve the giving of evidence by a person. Gummow J made precisely this point in Elna Australia (supra). The applicant in that case sought an order in the following terms:

"That a request be issued by or on behalf of the court to the High Court of Judicature [sic] for an order for evidence to be obtained in the United Kingdom by an order for production of documents set forth in the schedule hereto by ICL Computers Ltd ..."

44 On its proper construction the order sought by the applicant in that case was a request for an order for production of documents to the foreign court. That is not the taking of evidence or the causing of the taking of evidence of the person producing the documents: Elna Australia (supra) per Gummow J at 235.

45 However, the terms of the letters of request in this case are materially different to what was sought in Elna Australia. On their proper construction, the letters of request are in effect a combination subpoena duces tecum and ad testificandum.

46 It is no objection to the issue of a letter of request that the applicant is unable to specify the person able to give the relevant evidence: Hardie Rubber Co Pty Ltd v General Tire and Rubber Co [1973] HCA 66; (1973) 129 CLR 521 at 559. In Hardie Rubber a letter of request was directed to the appropriate tribunal in Japan for the examination in Japan of specified witnesses and of such other officers and employees resident in Japan of two named companies who might of their own knowledge or from records of the companies be able to give evidence material to the action.

47 The respondent concedes that the only relevant evidence which the proper officers can give would be to identify and authenticate documents. I understand the term "authenticate" to be intended to include reference to, inter alia, evidence which would or may qualify the document for admissibility under s 79C(1) or (2a) of the Evidence Act. It is not expected, and it would be highly unlikely, that the proposed examinees would have any personal knowledge of the contents of the documents.

48 Thus, the first issue to consider is whether there is any relevant distinction for the purposes of s 110(1)(c) between testamentary evidence concerning an issue in the proceedings and testamentary evidence solely directed at rendering admissible documentary evidence that is material to an issue in the proceedings, even if the witness is unable to give evidence in connection with the contents thereof or on any other relevant matter. For the purpose of this discussion I will assume the existence and materiality of the documents are established.

49 I see no reason in principle why there is or should be any relevant distinction. In my view, testamentary evidence relating solely to securing the admission of relevant documentary evidence is evidence material to an issue to be tried in the proceedings for the purposes of s 110(2)(b) of the Evidence Act. Further, it matters not that the testamentary evidence alone does not render the document admissible. It is sufficient if the evidence facilitates or is part of a necessary evidential foundation which enlivens the court's discretion to admit documents at trial, which documents are themselves material to the issue in the proceedings. That situation is to be contrasted with oral evidence which does not relate to a matter an issue in the proceedings because its purpose is to identify a person who may be able to give evidence in relation to an issue to be tried: Allstate Life Insurance Co & Ors v Australia & New Zealand Banking Group Ltd & Ors (No 18) (1995) 133 ALR 667.

50 If I am wrong and testamentary evidence directed solely at securing the admissibility of documents does not satisfy the criterion in s 110(2)(b) of the Evidence Act, there could be compelling discretionary factors in favour of issuing letters of request. This is such a case because the due and proper administration of justice can only be achieved by accessing documentary evidence outside Australia. The globalisation of commerce has consequences for dispute resolution which have to be taken into account in assessing the interests of justice. The focus must be on the circumstances of each case having regard to the ultimate question which is whether the interests of justice would be better served by granting or refusing an order: Hardie Rubber (supra) at p 559.

51 However, the respondent also sought and obtained an order requesting production of the documents identified in the schedules. The second issue is the extent of the Court's power to make that order. The purpose of s 110(1)(c) of the Evidence Act is to facilitate evidence being taken from a person outside Australia. In considering whether to request a foreign court to take (or cause to be taken) the evidence of the person, the court must consider whether that person will be able to give evidence material to any issue to be tried. The legislation does not in terms give the court the power to request that the person the subject of the request be required to produce documents. However, the matters enumerated in s 110(4) of the Evidence Act are not exhaustive. Where a court has made an order under s 110(1)(c), it can include in the order "a request as to any matter relating to the taking of that evidence".

52 That formulation is wide enough to enable this Court to include in its order a request that the person requested to give evidence produce documents which are relevant to the subject matter of the proposed evidence. However, the power to authorise orders for the production of documents is ancillary to and dependent on an order being made under s 110(1)(c): Elna Australia (supra) per Gummow J at p 236. The English authorities referred to by Gummow J in his reasons make it clear that the ancillary or incidental power does not permit the court to authorise orders for, in effect, discovery of documents: see Panthalu v Ramnord Research Laboratories Ltd [1966] 2 QB 173 at 189.

53 I do not find it particularly helpful to define the limits of the power by reference to the concepts of "discovery" and "fishing" because they do not precisely identify the basis of the objection. In this case the specification of the documents in the schedules to the letters is consistent with what is required for a subpoena duces tecum: Commissioner for Railways v Small (1938) 38 SR (NSW) 564 at 573-575. A subpoena duces tecum cannot be used to obtain discovery in the sense of requiring a third party to form a judgment on relevance. In my view, the reference to a discovery exercise in the context of letters of request includes a reference to the wide test of relevance used for discovery. That is, "materiality" is not established by reference to the test of relevance for discovery which is that it is sufficient if it would or probably would lead to a train of enquiry which would either advance a party's own case or damage that of his adversary: Mulley v Manifold [1959] HCA 23; (1959) 103 CLR 341 at 345.

54 Where the sole purpose of the testamentary evidence is to facilitate the admission of documentary evidence there must be evidence to establish the existence or probable existence of a particular document or class of documents and that the documents are, or are likely to be, material to an issue in the proceedings. The evidence in support must go further than a bare unsupported assertion of existence and relevance: Smith v Smith [1975] 1 NSWLR 725 at 728. The evidence in support of the respondent's application is inappropriately general. Further, the respondent conceded that he is unable to establish the existence or materiality of all the documents in the schedules to the letters of request. Finally, the proper officers would be unable to give any relevant evidence directed to the admissibility of many of the requested documents such as those received from third parties.

55 It is the case that there is sufficient evidence of the existence and materiality of some of the documents specified in the schedules such as Nexttrip's share and member registers. However, the primary objective purpose and effect of the application as a whole is to obtain production of documents for the purpose of identifying which of these documents the respondent may wish to tender. That is, the respondent sought production of a significant proportion of documents with a view to ascertaining whether they may be useful rather than with a view to adducing them in evidence as proof of some fact. That is outside the permissible scope of s 110 of the Evidence Act.

56 For these reasons I am of the opinion that the learned Master erred in granting the orders issuing the letters of request. It remains necessary to consider whether the applicants have demonstrated that there would be a serious injustice if the decision is not reversed.

57 There is no evidence on this question. However, that is not unusual in an application such as this. The applicants point to the significant additional legal costs associated with the issue of the letters of request, which would include the cost of legal representation in Canada. There is some question whether the applicants would indeed incur any such costs. However the matter ought to be approached by reference to principle. A party to an action ought to be able to exercise its right to be represented at all hearings, domestic or international, which can or may affect the outcome of the action. Having said that, I am not persuaded that the incurring of such costs alone would be sufficient to establish serious injustice. Those costs are to be expected in transnational ventures of the type in which the parties were involved.

58 However, there is a further consideration. The error below arises from limitations on the scope of the power. The scope of the power in s 110 of the Evidence Act may significantly impact on the respondent's ability to prove its case.

59 For these reasons I propose to order that the applicants be granted leave to appeal, the appeal be allowed and the respondent's application dated 14 February 2001 be dismissed.

Court Rules 1971(WA)

(Proceedings in other Jurisdictions) Act 1975

Tribunals Evidence Act 1856

Novotny & Anor v Todd [2002] WASCA 79

At a glance

Court

Decision date

Before

Catchwords

Source

Catchwords

Judgment (110 paragraphs)

Novotny & Anor v Todd [2002] WASCA 79 (9 April 2002)

Parties

Legislation Cited (5)

Cases Cited (10)