Paul Graham Unicomb v Gregory Scott Blais - [2024] NSWSC 903 - NSWSC 2024 case summary — Zoe

NSWNSWSC

Paul Graham Unicomb v Gregory Scott Blais

[2024] NSWSC 903

Supreme Court of NSW|2024-05-28|Before: McGrath J

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At a glance

Source facts

Court

Supreme Court of NSW

Decision date

2024-05-28

Before

McGrath J

Catchwords

[2004] HCA 39 Crest Homes Plc v Marks [1987] AC 829 CSR Ltd v Eddy (2005) 226 CLR 1
[2005] HCA 64 The Queen, on the application of Davey v Silverstein [2020] VSCA 233 Esso Australia Resources Ltd v Plowman (1995) 183 CLR 10
[1995] HCA 19 Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89
Curtis v Singtel Optus Pty Ltd

Source

Original judgment source is linked above.

Catchwords

[2004] HCA 39 Crest Homes Plc v Marks [1987] AC 829 CSR Ltd v Eddy (2005) 226 CLR 1[2005] HCA 64 The Queen, on the application of Davey v Silverstein [2020] VSCA 233 Esso Australia Resources Ltd v Plowman (1995) 183 CLR 10[1995] HCA 19 Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89Curtis v Singtel Optus Pty LtdSingtel Optus Pty Ltd v Almad (2014) 87 NSWLR 609[2014] NSWCA 266 Hearne v Street (2008) 235 CLR 125[2008] HCA 36 Helicopter Aerial Surveys Pty Ltd v Garry Robertson [2015] NSWSC 2104 Holpitt Pty Ltd v Varimu Pty Ltd (1991) 29 FCR 576[2005] FCAFC 3 Medway v Doublelock Ltd [1978] 1 WLR 710[1978] All ER 1261 Re Addstone Pty Ltd (in liq)Central Coast Council v Verde Terra Pty Ltd (No 7) [2020] NSWLEC 140Prudential Assurance Co Ltd v Fountain Page Ltd [1991] 1 WLR 756

Judgment (55 paragraphs)

[1]

[5]

INTRODUCTION

This is an application by the plaintiffs, Paul Graham Unicomb, HG InvestCorp Pty Ltd and GHT Holdings Pty Ltd (collectively plaintiffs), for a declaration that three affidavits provided in previous proceedings in this court are not the subject of an obligation owed to the court not to use them for any purpose other than that for which they were given. In the alternative, the plaintiffs seek that leave be granted to them and their legal representatives to use the three affidavits in these proceedings.
I will refer to Paul Graham Unicomb by his first name, without intending any disrespect or overfamiliarity.
The proceedings concern land at East Maitland and particular dealings with that land by its then owner Denis Thomas Wilton (now deceased), to whom I will also refer by his first name, without intending any disrespect or overfamiliarity.
The defendants are Gregory Scott Blais, Keith James Wilton and Jennifer Amie Blais (collectively defendants), to each of whom I will also refer by their first name, without intending any disrespect or overfamiliarity.
Keith is the son of Denis. Jennifer is the daughter of Denis. Gregory is married to Jennifer, so is the son-in-law of Denis.
The three affidavits (collectively Relevant Affidavits) which are the subject of this application were each made in earlier proceedings in this court and are the following: 1. the affidavit of Keith James Wilton affirmed 1 October 2021 (Wilton affidavit); 2. the affidavit of Gregory Scott Blais sworn 1 October 2021 (Blais affidavit); and 3. the affidavit of Noel Ashley Brent sworn 24 September 2021 (Brent affidavit).
Mr Brent was the accountant for Denis.
The defendants oppose the application.
There are two issues for me to determine: 1. whether the implied obligation not to use affidavits filed and served in one set of proceedings for any purpose other than those earlier proceedings applies to the Relevant Affidavits; and 2. if the answer to (1) is that the implied obligation does apply to the Relevant Affidavits, whether leave should be granted to the plaintiffs to use the Relevant Affidavits in these proceedings.
This case raises interesting questions regarding the application of the principle concerning the implied obligation stated in Hearne v Street (2008) 235 CLR 125; [2008] HCA 36 and the manner in which subsequent cases have sought to interpret and apply that principle. There has been considerable uncertainty amongst judges across Australia considering the issue of whether the principle in Hearne applies to affidavits filed and served pursuant to the normal timetabling orders of a court or court rules requiring such affidavits to support particular applications when they are made.
Rather than assuming that the implied obligation applies and determining the application solely on the basis of whether leave to use them should or should not be granted, I have decided to make a substantive decision on both issues.
I am grateful for the succinct and skilful oral and written submissions made by Mr Elliott SC with Mr Chiam as counsel for the plaintiffs, instructed by McCabes, and Mr Knackstredt as counsel for the defendants, instructed by Travis Partners.
I have determined that the implied obligation does not apply to each of the Relevant Affidavits in this case and, even if it did, I would grant leave for the plaintiffs to use each of the Relevant Affidavits in these proceedings.

[6]

Underlying factual matters

These proceedings and the earlier proceedings both involve a set of uncontested underlying facts concerning dealings with adjoining parcels of land located at 6 Wilton Drive, East Maitland (being Lot 8 in Deposited Plan 855275) and 62 Mount Vincent Road, East Maitland NSW (comprising Lot 141, Lot 142 and Lot 143 in Deposited Plan 1225076) (together the East Maitland Property).
At all material times up to the date of his death, Denis was the registered proprietor of the East Maitland Property.
On 7 August 2017, Denis executed a Deed of Call Option granting HG InvestCorp an option to purchase the East Maitland Property (Call Option Deed). The Call Option Deed provided, amongst other things, that the call option was granted in consideration for the Call Option Fee of $20,000 and that the Price on the exercise of the call option was the sum of $10.4 million (excluding GST) (cll 1.1(c), (o) and 2.1) and the Call Option Period within which the call option must be exercised by written notice of HG InvestCorp to Denis was between 43 days after 7 August 2017 and the earlier of: 1. 25 November 2018; or 2. 90 days after HG InvestCorp has obtained development consent in respect of the East Maitland Property (cll 1.1(e) and 2.2).
On 5 October 2018, Denis and HG InvestCorp entered into a Deed of Variation of Call Option which varied the Call Option Deed (cl 1) by increasing the Call Option Fee to $20,001 and extending the Call Option Period so that it ended on the earlier of: 1. 30 April 2019; or 2. 90 days after HG InvestCorp has obtained development consent in respect of the East Maitland Property.
On 30 April 2019, Denis and HG InvestCorp entered into a Deed of Further Variation of Call Option which further varied the Call Option Deed (cl 1) by increasing the Call Option Fee to $20,002 and further extending the Call Option Period so that it ended on the earlier of: 1. 31 January 2020; or 2. 90 days after HG InvestCorp has obtained development consent in respect of the East Maitland Property (cl 1.1(e)).
On 3 May 2019, Denis executed his last will (Will). The named executors in the Will are Keith and Gregory. The named beneficiaries in the Will are Jennifer, Keith, John Edward Wilton, Paul Denis Wilton and Marie Louise Corrigan. Without intending any disrespect or overfamiliarity, I will refer to Marie Louise Corrigan by her first name.
On 26 November 2020, Denis died. Marie was the partner of Denis at the time of his death.

[7]

Probate Proceedings and Equity Proceedings

On or about 9 December 2020, Keith and Gregory as executors under the Will lodged an application for probate over the Estate of Denis in this court commencing proceedings 2020/00349038 (Probate Proceedings).
On 30 March 2021, Gregory swore an affidavit in the Probate Proceedings (Earlier Blais affidavit) to support the Estate's application for an interim and limited grant of probate of the Estate.
On 13 April 2021, a hearing of the Estate's application for an interim and limited grant of probate was held before Slattery J, at which the Earlier Blais affidavit was read in open court. On that day, Slattery J made orders that Keith and Gregory be appointed as interim administrators of the Estate, with the power to settle accounts related to the continuation of the rezoning application for part of the East Maitland Property.
On or about 24 May 2021, Keith and Gregory as executors of the Will filed a statement of claim in the Probate Proceedings, joining Marie as a defendant, seeking a grant of probate in solemn form and a declaration that a codicil to the Will dated 5 May 2020 was not valid. There were no other parties to the Probate Proceedings.
On or about 13 July 2021, Keith and Gregory as executors commenced proceedings 2021/00199953 in this court against Marie and the New South Wales Registrar General, seeking declarations and orders that a transfer of property from Denis to Marie on 16 April 2020 be set aside on the basis that it was unconscionable and/or void from its inception (Equity Proceedings). The New South Wales Registrar General filed a submitting appearance in the Equity Proceedings. There were no other parties to the Equity Proceedings.
McCabes acted for Marie in the Probate Proceedings and the Equity Proceedings. Andrew Lacey of McCabes was the solicitor on the record for Marie in the Probate Proceedings and the Equity Proceedings.
On 16 August 2021, Registrar Walton made the following orders, inter alia, in the Equity Proceedings: 1. Notes the associated proceedings 2020/00349038 2. Directs the parties to file and serve the evidence in chief they intend to rely upon by 4pm on 13 September 2021. 3. Directs the parties to file and serve the evidence in reply they intend to rely upon by 4pm on 6 October 2021. …
On 16 August 2021, Hallen J made the following orders, inter alia, in the Probate Proceedings: … 2. Directs that each party is to file and serve evidence in chief upon which it is intended to rely by 4:00p.m. on 13 September 2021. 3. Directs that each party is to file and serve any evidence in reply by 4:00p.m. on 6 October 2021. …
On 14 September 2021, Hallen J made orders in the Probate Proceedings extending the time for compliance with orders 2 and 3 made on 16 August 2021, so that evidence in chief was directed to be filed and served by 4pm on 27 September 2021 and that any evidence in reply was directed to be filed and served by 4pm on 13 October 2021.
No order was ever made that the Probate Proceedings and the Equity Proceedings were to be heard together.
On 8 October 2021, the Wilton affidavit, the Blais affidavit and the Brent affidavit were each filed and served on behalf of Keith and Gregory in the Probate Proceedings and the Equity Proceedings. Mr Lacey of McCabes received the Relevant Affidavits in his capacity as the solicitor acting for Marie.
On or about 22 March 2022, Keith, Gregory and Marie entered into a Deed of Settlement and Release to resolve the Probate Proceedings and the Equity Proceedings.
On 22 April 2022, Hallen J made orders granting probate of the Estate in the Probate Proceedings, noted the settlement agreement between Keith, Gregory and Marie and dismissed the Probate Proceedings and the Equity Proceedings.
The plaintiffs concede that none of the Relevant Affidavits were read in open court in either the Probate Proceedings or the Equity Proceedings, although it appears from evidence provided by the defendants that [1], [8], [9] and [60]-[74] of the Brent affidavit were read in court on 22 April 2022 by Hallen J.
The Relevant Affidavits have not been provided to the plaintiffs by Mr Lacey, who is also acting as their solicitor in these proceedings. The Relevant Affidavits were provided to me as part of a confidential exhibit. In this judgment, I will only refer to the contents of any of the Relevant Affidavits in the most general form, in keeping with the confidentiality orders I made when they were received as evidence in these proceedings.

[9]

History of these proceedings

On 15 December 2023, the plaintiffs commenced these proceedings against the defendants by filing the summons seeking, inter alia: 1. declarations concerning: 1. an alleged binding and enforceable agreement between HG InvestCorp and Gregory and Keith as executors of the Estate, the terms of which were that: 1. HG InvestCorp or its nominee had an option to purchase the East Maitland Property for $10.4 million; 2. the option is exercisable on the approval of a development application for the construction of a retirement village on the East Maitland Property; 3. HG InvestCorp or its nominee will pursue an application to rezone Lot 141 before seeking approval of a development application for it, the costs of the rezoning application will be borne in half shares by HG InvestCorp or its nominee and Denis and the costs of the development application will be borne by HG InvestCorp or its nominee (Agreement); 1. an alleged estoppel against Gregory and Keith from denying that they are bound by terms of the Agreement as executors of the Estate; 2. alleged misleading and deceptive conduct by Gregory in representing that he would perform the Agreement as the representative of Denis and executor of the Estate; 3. the plaintiffs are a creditor in the administration of the Estate and entitled to an amount pursuant to the Agreement; 4. Gregory and Keith permitted the transmission of the East Maitland Property to Keith and Jennifer in alleged breach of their duties as executors of the Estate; 1. an order that probate of the Estate be revoked; 2. an order appointing an administrator of the Estate; 3. an order that Keith transfer his share of the East Maitland Property to himself and Gregory in their capacity as executors of the Estate; and 4. alternatively, damages against Gregory and Keith or equitable compensation payable by Gregory and Keith to the Estate.
As mentioned above, Andrew Lacey of McCabes is acting for the plaintiffs in these proceedings, having also acted for Marie in the Probate Proceedings and the Equity Proceedings.
On 14 February 2024, Slattery J made orders in these proceedings, inter alia, that they proceed by way of pleadings and directed that the plaintiffs file and serve their statement of claim by 8 March 2024, the defendants file and serve any defence by 5 April 2024 and the plaintiffs file and serve any reply by 19 April 2024.
On 19 March 2024, the plaintiffs filed and served the statement of claim in these proceedings.
On 26 April 2024, Slattery J extended the time for the plaintiffs to file and serve any reply to 10 May 2024 and also fixed a timetable for the service of evidence.
On 23 April 2024, each of Gregory, Keith and Jennifer filed and served their respective defences in these proceedings.
On 10 May 2024, the plaintiffs served their reply to the defences of the defendants in these proceedings.
No affidavits have yet been filed by the plaintiffs or the defendants in these proceedings, with the exception of an affidavit of Paul (the first plaintiff) sworn 15 December 2023 which was filed with the summons, and was not read on this application.

[10]

Issues in these proceedings

The relief sought in the statement of claim in these proceedings is in the same form as that which was sought in the summons, save for the addition of a further or alternative form of relief, being an order that Gregory and Keith pay GHT Holdings an alleged rezoning debt of $56,030.
The facts which the plaintiffs allege in the statement of claim are extensive. In summary, they are essentially as follows: 1. From 2015 to the end of 2019, Paul and HG InvestCorp entered into a series of oral and written agreements (including the Call Option Deed, the Deed of Variation and the Deed of Further Variation) with Denis and Denis made oral representations to them the effect of which were that they had a call option to purchase the East Maitland Property. 2. In reliance on these agreements and representations, from 2015 onwards, Paul, HG InvestCorp and GHT Holdings expended significant sums of money and took steps to obtain the rezoning and development approval of the East Maitland Property as a retirement village. 3. From around June 2019, Gregory orally represented to Paul that Gregory was assisting Denis with the sale of the East Maitland Property and Gregory was authorised to make decisions with respect to the East Maitland Property. 4. Around 21 December 2019, Denis and Gregory agreed that Gregory could make decisions with respect to the sale of the East Maitland Property on behalf of Denis, such that Gregory was Denis' agent in respect of the sale of the East Maitland Property. 5. In March 2020, November 2020 and from about 26 November 2020 to mid-2021, Gregory orally represented to Paul that Gregory would perform the call option on behalf of Denis and Gregory could ensure that it would be performed after Denis died. 6. In reliance on Gregory's oral representations, Paul caused GHT Holdings to expend significant sums of money and took steps to obtain the rezoning and development approval of the East Maitland Property as a retirement village. 7. On 26 November 2020, Denis died. 8. On 27 July 2021, Maitland City Council approved the rezoning proposal in respect of part of Lot 141. 9. After 27 July 2021, Gregory orally represented to Paul that Gregory would perform the call option on behalf of Denis, Gregory would continue pursuing the rezoning of the other parts of Lot 141 and Paul should not lodge a development application for Lot 141 until Gregory had exhausted his attempts at the rezoning. 10. In reliance on Gregory's further oral representations, Paul caused HG InvestCorp and/or GHT Holdings not to lodge a development application for Lot 141. 11. On around 14-15 June 2022, Keith and Jennifer became the registered proprietors of the East Maitland Property. 12. On about 29 September 2023, Keith and Jennifer entered into an option deed with East Maitland 62 Pty Ltd in respect of Lot 8 and Lot 141. 13. On 3 October 2023, Gregory informed Paul that the East Maitland Property had been sold.
Based on these essential facts, the claims made in the statement of claim are: 1. An equitable estoppel against Gregory and Keith from denying they are bound by the terms of the Call Option Deed (as varied). 2. Gregory and Keith breached their duties as executors of the Estate causing the plaintiffs to suffer loss and damage. 3. HG InvestCorp held an equitable interest in the East Maitland Property as at the date of Denis's death. 4. Gregory and Keith have been misleading and deceptive in the oral representations made, causing Paul, HG InvestCorp and GHT Holdings to suffer loss. 5. GHT Holdings is owed a debt for the costs incurred in pursuing the rezoning application for Lot 141. 6. A quantum meruit in favour of Paul, HG InvestCorp and GHT Holdings to compensate them for the work they performed on the development application and the rezoning application which has caused the value of the East Maitland Property to increase to the benefit of Keith and Jennifer at the expense of Paul, HG InvestCorp and GHT Holdings.
The defence of each of the defendants is essentially in the same terms: admitting that Denis and HG InvestCorp entered into written agreements in the form of the Call Option Deed in August 2017, the Deed of Variation in October 2018 and the Deed of Further Variation in April 2019, but either not admitting or denying that any oral agreements and representations were made.
The defendants also admit that Gregory was assisting Denis with the sale of the East Maitland Property, but deny that Gregory was authorised to make decisions with respect to the East Maitland Property. The defendants admit that Keith, jointly and severally with Gregory, held an enduring power of attorney dated 3 May 2019 on behalf of Denis, but otherwise do not admit that from around 21 December 2019 Gregory was Denis' agent with respect to the sale of the East Maitland Property.

[11]

Permission sought to use the Relevant Affidavits

On 4 April 2024, Mr Lacey as the plaintiffs' solicitor had a telephone conversation with Marie seeking her consent for McCabes and counsel engaged by McCabes to consider the Relevant Affidavits in the context of these proceedings. On the same day at 12:37pm, Mr Lacey sent an email following up this conversation, asking for Marie's consent to McCabes considering the Relevant Affidavits in terms of the relevance of their content to the matters in these proceedings. At 1:11pm that day, Marie replied by email relevantly stating: I Marie Louise Corrigan give McCabes and their legal team my permission to use the information mentioned in the Unicomb's proceedings in which ever way you choose.
On 10 April 2024, McCabes sent a letter by email to Travis Partners (the solicitors for Gregory and Keith) outlining their view that there is no obligation on the plaintiffs which precludes the use of the Relevant Affidavits in these proceedings but, for abundant caution and although not strictly required, seeking their consent to a proposed application by the plaintiffs for a declaration that the Relevant Affidavits are not the subject of any obligation owed to the court not to use them for any purpose other than that for which they were given.
Also on 10 April 2024, McCabes sent a letter by email to Mr Brent (the accountant for Denis) asking whether he objected to the use of the Brent affidavit in these proceedings.
On 10 April 2024 at 6:35pm, Travis Partners sent an email to McCabes responding to their letter of even date by requesting a copy of the Relevant Affidavits so that they could take instructions.
On 11 April 2024, McCabes replied by email to Travis Partners, seeking confirmation of certain matters in relation to the Relevant Affidavits before they would be provided to them.
On 22 April 2024, Travis Partners sent a letter to McCabes setting out their view that the Relevant Affidavits are subject to the implied undertaking described in Harman v Secretary of State for Home Department [1983] 1 AC 280 and Hearne v Street (2008) 235 CLR 125; [2008] HCA 36 and relevantly stating that whilst the defendants: … do not intend to consent to your clients' proposed application, we do not see this as a matter for our clients' consent. Rather, it is a question for your clients to satisfy the Court that the implied undertaking should not apply - particularly where, as here, a litigant in previous litigation (your former client) has apparently given copies of material or authorised its use by a third party in unrelated litigation.
On 3 May 2024, the plaintiffs filed the notice of motion making this application in these proceedings seeking the following principal orders: 1. A declaration that the Relevant Affidavits are not the subject of an obligation owed to this court not to use them for any purpose other than that for which they were given. 2. In the alternative, that the court grant leave to the plaintiffs, and any of their legal representatives, to use the Relevant Affidavits for the purposes of these proceedings. 3. A declaration that the Relevant Affidavits may be provided by the solicitors for the plaintiffs to the plaintiffs for the purpose of these proceedings.
On 9 May 2024, Mr Brent sent an email to Travis Partners stating that he did not consent to the use of the Brent affidavit in these proceedings.

[13]

Bound by the High Court and regard to intermediate appellate decisions

In undertaking my determination of the application, I am acutely conscious that it does not lie for intermediate appellate courts or single judges such as me to restate the law pronounced by the High Court. I am bound by the decisions of the High Court and decisions of the Court of Appeal of this court but I must also have regard to decisions of intermediate appellate courts and not depart from them unless I think that they are plainly wrong. My primary task is to consider the language used by the High Court in its reasons to understand its meaning and use the judgments of other courts as no more than a guide to interpreting those reasons.
The principle that I am bound by what the High Court has said but not another court's interpretation of what the High Court has said is well expressed in Hasler v Singtel Optus Pty Ltd; Curtis v Singtel Optus Pty Ltd; Singtel Optus Pty Ltd v Almad (2014) 87 NSWLR 609; [2014] NSWCA 266, by Leeming JA (with whom Barrett and Gleeson JJA agreed) saying at [98]-[99]: [98] This Court is bound by what the High Court said in Farah as to second limb Barnes v Addy liability. It is bound directly. Ultimately, it is bound by reason of s 73 of the Commonwealth Constitution. This Court is not bound indirectly by another court's interpretation of what the High Court said. To paraphrase the words of McHugh J in Marshall, the primary guide to understanding the law as stated by the High Court is the language of that Court's reasons, and a judicial decision as to what those reasons mean is at best a guide to, but cannot control, the meaning of that language. [99] Naturally, considerations of comity require regard to be had to decisions of other Australian courts, especially intermediate appellate courts, in applying and developing the common law of Australia. But either Farah has changed the meaning of "dishonest and fraudulent design" in second limb Barnes v Addy liability or it has not. The fact that a majority of the Western Australian Court of Appeal considered that the phrase has been diluted by Farah does not absolve this Court from its obligation to apply the law which binds it as stated by the High Court.
The doctrine of stare decisis means that I am bound by appellate decisions of the Court of Appeal of this court as a court standing above me in the same hierarchy: Businessworld Computers Pty Ltd v Australian Telecommunications Commission (1988) 82 ALR 499, Gummow J at 504. But I must also have regard to intermediate appellate court decisions, as was made plain in Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89; [2007] HCA 22, Gleeson CJ, Gummow, Callinan, Heydon and Crennan JJ at [135] saying (footnote omitted): … Intermediate appellate courts and trial judges in Australia should not depart from decisions in intermediate appellate courts in another jurisdiction on the interpretation of Commonwealth legislation or uniform national legislation unless they are convinced that the interpretation is plainly wrong. Since there is a common law of Australia rather than of each Australian jurisdiction, the same principle applies in relation to non-statutory law. …
An essential matter which must always be kept in mind in applying the principles stated by a superior court is that any proposition which has been assumed to be correct without argument in the superior court is not binding on a lower court even when it forms part of the ratio decidendi. This was stated in Coleman v Power (2004) 220 CLR 1; [2004] HCA 39, by McHugh J at [79]: In my view - in constitutional and public law cases as well as private law cases - parties can concede issues even though the issue is a legal issue. The only power with which this Court is invested is judicial power together with such power as is necessary or incidental to the exercise of judicial power in a particular case. The essence of judicial power is the determination of disputes between parties. If parties do not wish to dispute a particular issue, that is their business. This Court has no business in determining issues upon which the parties agree. It is no answer to that proposition to say that this Court has a duty to lay down the law for Australia. Cases are only authorities for what they decide. If a point is not in dispute in a case, the decision lays down no legal rule concerning that issue. If the conceded issue is a necessary element of the decision, it creates an issue estoppel that forever binds the parties. But that is all. The case can have no wider ratio decidendi than what was in issue in the case. Its precedent effect is limited to the issues. …
Further, in CSR Ltd v Eddy (2005) 226 CLR 1; [2005] HCA 64, Gleeson CJ, Gummow and Heydon JJ at [13] said (footnotes omitted): … It is of course commonplace for the courts to apply received principles without argument: the doctrine of stare decisis in one of its essential functions avoids constant re-litigation of legal questions. But where a proposition of law is incorporated into the reasoning of a particular court, that proposition, even if it forms part of the ratio decidendi, is not binding on later courts if the particular court merely assumed its correctness without argument. "[T]he presidents, … sub silentio without argument, are of no moment."

[14]

The Harman undertaking

The implied obligation is often referred to as the Harman undertaking in reference to the case of Harman v Secretary of State for Home Department [1983] 1 AC 280. Numerous cases interchangeably refer to the implied obligation as an "implied undertaking" or a "Harman undertaking".
The notion of an implied obligation, however, has its roots well before Harman was decided, having been stated nearly a century before. In Riddick v Thames Board Mills Ltd [1977] QB 881, Lord Denning MR at 895-896 described the history and form of the implied obligation as resting in the balance that lies between the public interest in compelling discovery to find the truth and the public interest in the protection of the private interests of privacy and confidentiality which are invaded by discovery, saying: The reason for compelling discovery of documents in this way lies in the public interest in discovering the truth so that justice may be done between the parties. That public interest is to be put into the scales against the public interest in preserving privacy and protecting confidential information. The balance comes down in the ordinary way in favour of the public interest of discovering the truth, i.e., in making full disclosure. … … Compulsion is an invasion of a private right to keep one's documents to oneself. The public interest in privacy and confidence demands that this compulsion should not be pressed further than the course of justice requires. The courts should, therefore, not allow the other party - or anyone else - to use the documents for any ulterior or alien purpose. Otherwise the courts themselves would be doing injustice. … In order to encourage openness and fairness, the public interest requires that documents disclosed on discovery are not to be made use of except for the purpose of the action in which they are disclosed. … The principle was stated in a work of the highest authority 93 years ago by Bray J., Bray on Discovery, 1st ed. (1885), p. 238: "A party who has obtained access to his adversary's documents under an order for production has no right to make their contents public or communicate them to any stranger to the suit: … nor to use them or copies of them for any collateral object … If necessary an undertaking to that effect will be made a condition of granting an order: …" Since that time such an undertaking has always been implied, as Jenkins J. said in Alterskye v Scott [1948] 1 All ER 469, 471. A party who seeks discovery of documents gets it on condition that he will make use of them only for the purpose of that action, and no other purpose. …
Harman was a case involving an application by the Home Office against Ms Harman for contempt. Ms Harman acted as solicitor for a former prisoner in proceedings against the Home Office concerning his alleged unlawful confinement. During those proceedings, the Home Office gave discovery of documents pursuant to an order of the court after a contested interlocutory application, which included six confidential documents over which the Home Office had unsuccessfully claimed public interest immunity from production. The documents were read out in court during the lengthy hearing. After the hearing, Ms Harman allowed a journalist to inspect the documents, make notes about them and take extracts from them for the purposes of writing a newspaper article.
At first instance, Park J found that Ms Harman was in contempt of court, but imposed no penalty. The Court of Appeal refused leave to appeal from that decision. Although the House of Lords were split three-two in the result (the majority - Lords Diplock, Keith and Roskill - dismissing the appeal, whereas Lords Simon and Scarman would have allowed the appeal), they were all broadly in agreement as to the existence and description of the implied undertaking to the court not to use documents obtained on discovery in proceedings other for the purposes of those proceedings.
Lord Diplock expressed the principle in this way (in masculine language, which might be explained by its times, although it is still odd given the solicitor in Harman was a woman) at 304-305: … an order for production of documents to a solicitor on behalf of a party to civil litigation is made upon the implied undertaking given by that solicitor personally to the court (of which he is an officer) that he himself will not use or allow the documents or copies of them to be used for any collateral or ulterior purpose of his own, his client or anyone else; and any breach of that implied undertaking is a contempt of court by the solicitor himself. Save as respects the gravity of the contempt no distinction is to be drawn between those documents which have and those which have not been admitted in evidence; to make use for some collateral or a ulterior purpose of the special advantage obtained by having possession of copies of any of an adverse party's documents obtained upon discovery is, in my view, a contempt of court.
Lord Keith said at 307: It is not disputed on behalf of the appellant that, by virtue of the order for discovery of the documents here in issue, she and her client were placed under an implied obligation not to make use of the documents for any purpose other than the proper conduct of the litigation in the course of which the order was made. …
Lord Keith emphasised at 308 that: … Discovery constitutes a very serious invasion of the privacy and confidentiality of a litigant's affairs. It forms part of English legal procedure because the public interest in securing that justice is done between the parties is considered to outweigh the private and public interest in the maintenance of confidentiality. …
Lord Keith at 308 further said that the implied obligation: … affords a particular protection accorded in the interests of the proper administration of justice. It is owed not to the owner of the documents but to the court, and the function of the court in seeing that the obligation is observed is directed to the maintenance of those interests, and not to the enforcement of the law relating to confidentiality.
Lord Scarman (with whom Lord Simon agreed) described the implied undertaking in this way at 312 and 313: … The law imposes the obligation under consideration in this appeal for the protection of the party compelled to make discovery of documents in legal proceedings. It does so by implying an undertaking by the party to whom discovery is made and his solicitor not to use them for any purpose other than that of the action. Disregard of the undertaking is enforceable by the party for whose benefit it is exacted in committal proceedings for contempt of court. … In our view, a just balance is struck if the obligation endures only so long as the documents themselves are private and confidential. Once the litigant's private right to keep his documents to himself has been overtaken by their becoming public knowledge, we can see no reason why the undertaking given when they were confidential should continue to apply to them. Imposed by law the obligation is formulated as arising from an undertaking exacted by the court from the party and his solicitor to whom the documents are disclosed. It is the condition upon which discovery is ordered. The undertaking protects the confidentiality of the documents which the course of justice requires to be disclosed in the litigation. …

[16]

Liberty Funding

Liberty Funding Pty Ltd v Phoenix Capital Ltd (2005) 218 ALR 283; [2005] FCAFC 3 is a decision of the Full Court of the Federal Court of Australia. It involved an application to the Federal Court for leave to use an affidavit sworn by the chief executive officer of the respondent in proceedings in the Supreme Court of Victoria. The affidavit had been made, filed and served pursuant to an order of the Federal Court requiring the respondent to state the extent of dissemination of an alleged misleading and deceptive document in lieu of giving discovery of documents on that issue. The Federal Court proceedings then settled at mediation. New proceedings were then commenced in the Federal Court by one of the applicants in the earlier proceedings, which were then transferred to the Supreme Court of Victoria.
Importantly, at [6] the Full Court described the affidavit in this way: … the affidavit was to take the place, and fulfil the function, of an affidavit of discovery and of inspection of discovered documents. …
The primary judge concluded that the affidavit remained the subject of legal professional privilege as it had not been read in open court. The Full Court (Branson, Sundberg and Allsop JJ) observed at [15]: The primary judge came to the conclusion he did by applying what his Honour saw to be the preponderance of authority to the effect that statements or affidavits filed and served in proceedings, but not read in open court, remained subject to legal professional privilege. The primary judge referred to the reasons of Olney J in Nilsen Industrial Electronics Pty Ltd v National Semiconductor Corporation (1994) 48 FCR 337, of the Full Court of the Supreme Court of South Australia in State Bank of South Australia v Smoothdale (No 2) Ltd (1995) 64 SASR 224 and of the Court of Appeal of New South Wales in Akins v Abigroup Ltd (1998) 43 NSWLR 539 and Sevic v Roarty (1998) 44 NSWLR 287; [1998] NSWSC 462 , and to other cases. With one exception, all these cases dealt with the status of statements of prospective witnesses filed and served pursuant to court order in advance of the trial, not with the status of affidavits in like position.
The Full Court allowed the appeal, finding that the affidavit was not privileged once it was filed and served because it was no longer confidential (at [22]-[23]). Before doing so, the Full Court distinguished the decisions on which the primary judge had relied which concerned the evidence anticipated to be given at a hearing in the form of witness statements and the different role of the affidavit in Liberty Funding, saying at [19]-[21]: [19] We are of the view that this case can be disposed of without the necessity for expressing a concluded view on the correctness or otherwise of the approach of the Full Court in Smoothdale or of the Court of Appeal in Akins or Sevic. [20] The Jeffery affidavit was intended to fulfil the role (albeit somewhat extended) of an affidavit of discovery. It was intended to be read and relied upon by the other side in the litigation. Without dispensation of the court, it could not be used otherwise than for the purposes of the First Proceeding. That could be seen to give a measure of practical confidentiality to Bluestone, but it was not a limitation based on confidence. The applicants in the first proceeding were at liberty to use the Jeffery affidavit and its contents as they saw fit for the proper purposes of that litigation. Such purposes might well involve disclosing all or part of the contents of the Jeffery affidavit to third parties without obtaining confidentiality undertakings. The restraint on use after service is derived from an implied undertaking to the court (in its terms contemplating discharge in some circumstances) the purpose of which is to prevent any abuse of the court's procedures. It is not a limitation based on the existence of confidentiality or privilege. The role intended to be fulfilled by the Jeffery affidavit was inconsistent with the maintenance of the confidentiality of the communications recorded in, and any advice apparent from, the contents of the Jeffery affidavit. [21] The affidavit was not brought into existence as part of the anticipated evidence for a hearing, whether final or interlocutory. It was intended to be a convenient procedural device in the nature of, but in lieu of, a usual affidavit of discovery. That is sufficient, we think, to distinguish Smoothdale, Akins and Sevic. Those cases dealt with the status of proposed evidence served in advance of the trial. Also, the fact that the subject of debate here is an affidavit sworn under relevant legislation attending the making of an oath further distinguishes the position from those cases.
The key consideration in the decision in Liberty Funding was therefore that the affidavit which was filed and served was akin to discovery and subject to the implied undertaking. The Full Court proceeded on the basis that leave to use the affidavit was required and there was no argument about whether that was or was not correct. Applying the principle outlined in Coleman and CSR, the implied undertaking was assumed to apply, a determination which is not binding on later courts.
The Full Court expressly stated at [24] that although it was not necessary to analyse the decisions in Smoothdale, Akins and Sevic, there was: … a real issue as to the correctness of those decisions, at least insofar as they deal with the question of waiver at common law by service of statements (or affidavits) of witnesses in advance of the trial.
The Full Court at [27] also eschewed consideration of whether statements or affidavits filed in advance of the hearing under procedural directions or orders are provided "under compulsion of law" for the purposes of s 122(1)(c) of the Evidence Act 1995 (Cth).
The balance of the decision in Liberty Funding concerned the principles to be applied in determining whether leave should be granted to release the implied undertaking. I will return to my consideration and application of those principles in dealing with Issue 2 in this judgment below.

[17]

Hearne

In Australia, the guiding authority on the implied obligation is Hearne.
In Hearne, the High Court determined an appeal in an action for contempt by two directors, Mr Hearne and Mr Tierney. The underlying case involved a claim in nuisance against Luna Park Sydney Pty Ltd (the lessee and operator of the famous Luna Park on Sydney Harbour beside the Sydney Harbour Bridge) and Metro Edgely Pty Ltd (a 50% shareholder of Luna Park Sydney Pty Ltd) by nearby residents due to the noise coming from Luna Park during its operations. Mr Hearne was the managing director and chief executive officer of Luna Park Sydney Pty Ltd and Mr Tierney was a director of Multiplex Ltd, the ultimate holding company of Metro Edgely Pty Ltd.
The residents had filed affidavits in support of their case, which had not become evidence in the proceedings, but found their way into a newspaper article. The defendants gave an unreserved apology for the release of the affidavits and an express undertaking not to release any unread affidavits to the media or any other person not properly connected to the proceedings. The court then made orders for further discovery and experts' reports, pursuant to which a noise impact assessment report and an affidavit sworn by one of the plaintiffs were filed and served in the proceedings on behalf of the plaintiffs. Mr Hearne sent an email to the office of the Minister for Tourism, Sport and Recreation which attached an excerpt from each of the affidavit and the acoustic expert's report. The plaintiffs then brought the contempt proceedings against Mr Hearne and Mr Tierney.
The primary judge, Gzell J of this court, dismissed the contempt charges on the basis that Messrs Hearne and Tierney had not given any undertaking to the court and neither had any knowledge of the implied undertaking given by Luna Park Sydney Pty Ltd and its solicitors. The Court of Appeal of this court held that the implied undertaking given by Luna Park Sydney Pty Ltd and Metro Edgely Pty Ltd was imposed by law and binding on Messrs Hearne and Tierney, even though they did not know of it, which they breached because they knew that the proceedings were pending and that documents had been produced in accordance with the processes of the court.
There are three important points to keep in mind when considering the judgments of the High Court in Hearne. 1. The expert report and affidavit which were the subject of the contempt proceedings were filed in accordance with ordinary timetabling orders of the court. 2. It was not in contest between the parties, and was accepted by the High Court, that the expert report and affidavit were subject to the implied undertaking not to use affidavits or witness statements served by another party otherwise than for the purpose of the proceedings in which they were prepared. Applying the principle stated in Coleman and CSR as expressed above, because the correctness of the application of the implied undertaking to the expert report and affidavit was assumed without argument, it is not binding on later courts even though it forms part of the ratio decidendi in Hearne. 3. Neither the expert report nor the affidavit had been tendered or read in the proceedings.
In Hearne, Hayne, Heydon and Crennan JJ delivered the principal judgment. On the issue of the implied undertaking, both Gleeson CJ (at [3]) and Kirby J (at [57]) explicitly agreed with the reasons expressed by Hayne, Heydon and Crennan JJ.
At [3] Gleeson CJ agreed with Hayne, Heydon and Crennan JJ that the implied undertaking is now better understood as a substantive legal obligation. Describing the basis for the obligation, Gleeson CJ at [5] said: Compulsory pre-trial exchange or disclosure of materials, such as witness statements and experts' reports, is now extensive. The rationale sometimes given for the obligation concerning discovery of documents (it is the condition upon which a court compels disclosure of private documents) may not always be applicable to witness statements or experts' reports. There may be little or nothing about them that is private. This, in turn, is connected with the scope of the potential liability of strangers to the litigation into whose hands such materials may come. …
Hayne, Heydon and Crennan JJ commence their reasons at [61] with the expression of the central issue, being: Where a corporate litigant is bound by an "implied undertaking" not to use affidavits or witness statements served by another party on it otherwise than for the purpose of the proceedings in which they were prepared, in what circumstances can servants and agents of the litigant who use the affidavits or witness statements in that way be liable for contempt of court? One issue in this appeal is whether either or both of the appellants was bound by such an implied undertaking.
There was no analysis whether or not the implied undertaking even applied to the expert report and affidavit at issue in Hearne. This is explicable because the parties did not put that issue in contest. There was also no controversy over the applicable legal principles. Those principles and the lack of controversy about them are expressed by Hayne, Heydon and Crennan JJ at [95]-[97] as follows (footnotes omitted): [95] Before turning to the appellants' submissions in relation to the extent and enforceability of the "implied undertaking", it is desirable to set out some background legal principles which were not in controversy. [96] 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. The appellants did not dispute the existence of this principle, and in particular did not dispute its potential application to the affidavit of Mrs Hesse and the witness statement of Dr Tonin. [97] It is common to speak of the relevant obligation as flowing from an "implied undertaking".
Although I have removed the footnotes in the quoted passages above, it is necessary to consider a number of the cases which are referenced in those footnotes to give greater insight into the basis for the statements which are made.
Before turning to that consideration, it is noteworthy that the joint judgment in Hearne at [105]-[108] also traced the history of the implied undertaking up until Harman to establish it as being regarded as a substantive obligation, commencing with it depending upon an express undertaking, then moving to it being variously described in different cases as a rule, an implied undertaking, a condition and an implied obligation or duty. Hayne, Heydon and Crennan said at [106]-[107] (footnotes and excerpt omitted): [106] The fact that the role of the word "undertaking" is merely to indicate the way in which an "obligation" which is "imposed by law" as a "condition" of discovery binds the disclosee highlights the substantive nature of the obligation. There is nothing voluntary about the "undertaking". … [107] The expression "implied undertaking" is thus merely a formula through which the law ensures that there is not placed upon litigants, who in giving discovery are suffering "a very serious invasion of the privacy and confidentiality of [their] affairs", any burden which is "harsher or more oppressive … than is strictly required for the purpose of securing that justice is done." …
The footnote references from which the rationale for the implied undertaking in [107] are drawn are the statements made by Lord Denning in Riddick and Lord Keith in Harman. In summary, the rationale is the outcome of the balancing of the serious invasion of the private rights in the privacy and confidentiality of the documents and information compelled to be disclosed with the public interest in securing justice.
On the subject of those who are subject to the implied obligation, the joint judgment in Hearne held at [109]-[112] that the primary person bound is the litigant who receives the documents or information from the other side pursuant to the litigious process, as are others to whom documents and information are given such as expert witnesses, litigation funders and those with knowledge of the origins of the material in legal proceedings.
I will now turn to consider the authorities on which the principle of the implied obligation expressed by Hayne, Heydon and Crennan JJ in Hearne at [96] are based.

[18]

Compulsion - Bourns and the Bourns appeal

The principal passage in the judgment is [96], the opening sentence of which conditions the rest of the paragraph with the concept that the party to the litigation must be "compelled" to disclose documents or information in one or more of three ways - (1) a rule of court; (2) a specific order of the court; (3) otherwise.
The footnote which appears after the word "otherwise" at [96] refers to Bourns Inc v Raychem Corp [1999] 1 All ER 908 at 916 [19]; affirmed in [1999] 3 All ER 154 at 169-170 (Bourns appeal).
Bourns involved a party who had disclosed documents on a previous taxation seeking to restrain the party to whom they were disclosed from using them for a collateral purpose. In Bourns at first instance, Laddie J found that the implied undertaking applied to the documents produced during the taxation, even though it was not a disclosure compelled by order or rule of the court. In Bourns, Laddie J at [19] said: There is no doubt that the disclosure of documents for the purpose of a taxation is not a process of discovery. As Hobhouse J pointed out in Pamplin v Express Newspapers Ltd [1985] 2 All ER 185 at 190, [1985] 1 WLR 689 at 696 the taxing master does not have power to order discovery to be given. The documents only need to be supplied to him. He cannot force the payee to pass them on to the payer. But the reason for this should be borne in mind. In taxations, most of the documents produced by the payee are ones to which privilege will attach. It is because, as a generality, the documents, and particularly the most important ones, are likely to be highly confidential, that they are not automatically passed on to the payer. Therefore an obligation to give general discovery subject to the right to withhold privileged material would be an exercise of limited value. In fact, in most cases, as Hobhouse J pointed out in Pamplin's case, taxation takes place without any of the payee's internal documents being considered by the payer. But taxation inter partes arising out of civil litigation is essentially adversarial. One party is claiming money from another and the taxing master must, if requested, hold a hearing and decide issues of fact. He can call for evidence and has the power to examine witnesses. The documents produced by the payee are kept out of the fray because of their highly sensitive nature. But when called upon by the payer to hand them over, and that request is indorsed by the master, the payee must elect between complying with the request or withdrawing reliance on them. In effect, the master makes the payee an offer he cannot refuse. In my view, to say that compliance with the request is voluntary in those circumstances is misconceived. On the same hypothesis, it could be said that discovery given by a plaintiff in an action is voluntary since he could always avoid the necessity for doing so by abandoning his claims. In my view, any payee attempting to enforce an order for costs in his favour by embarking on a taxation is compelled to produce his documents to the taxing master and, where the payer demands a view of them, is effectively compelled to produce to him as well. Although the handover is not automatic, it is, no less, a compulsory disclosure of private documents for the purpose of the taxation. All the considerations which make it appropriate to imply an undertaking not to make collateral use of discovery documents apply equally strongly to collateral use of documents produced on taxation. To adopt the language of the Prudential case, by virtue of the circumstances under which the payer obtains the documents in the course of taxation, a legal obligation is imposed on him by operation of law not to make collateral use of them.
In the same footnote, Hayne, Heydon and Crennan JJ also refer to the Bourns appeal judgment at 169-170, which upheld Laddie J's finding that the implied undertaking applied to the documents provided in the taxation. In the Bourns appeal, Aldous LJ (with whom Swinton Thomas LJ and Sir Stephen Brown P agreed) at 169-170 said: Raychem submitted that the implied undertaking only applied in circumstances where a party was compelled to produce a document as stated by Hobhouse J in the Prudential Assurance [Co Ltd v Fountain Page Ltd] [1991] 3 All ER 878 at 890, [1991] 1 WLR 756 at 769: 'From these authorities it is clear that there is no blanket restriction on the use of documents and information acquired in the course of litigation. Prima facie there is no restriction. The compulsion exception is confined to documents and information which a party is compelled, without any choice, to disclose. Where a party has a right to choose the extent to which he will adduce evidence or deploy other material, then there is no compulsion even though a consequence of such choice is that he will have to disclose material to other parties. On the authority of the Comfort Hotels case and Derby v Weldon (No 9) ([1990] Times, 9 November), witness statements and experts' reports served pursuant to the provisions of Ord 38 or directions given thereunder are not served under compulsion and are not protected by the duties or undertakings which the court implies where there is compulsion.' (Hobhouse J's emphasis.) Raychem went on to submit that as Bourns was not compelled to produce the documents no implied undertaking resulted. The statement of Hobhouse J in the Prudential Assurance case that I have quoted must be read in context. In that case it was contended that the implied undertaking applied to witness statements and experts' reports. In the passage quoted the judge was distinguishing between the witness statements which a party was not bound to disclose and documents that he was under a duty to disclose. He did not have in mind the procedure in taxation proceedings where, as I have already pointed out, a party who proceeds with taxation is under a duty to provide the taxing master with documents relevant to the claim which are likely to include privileged documents. There is no automatic discovery, but, as pointed out in Pamplin's case, natural justice requires that the payer should have disclosed to him the documents relied on in the proceedings. It is on that basis that the Court of Appeal decided that privilege was only waived for the purposes of taxation if the documents were disclosed to the payer by the taxing master or pursuant to his order. If the taxing master had ordered the documents to be disclosed to Raychem then there could be no doubt that the disclosure would have been subject to the implied undertaking. True, there was no such order, but the disclosure was made in circumstances where the documents were requested, they were directly relevant to an issue and natural justice meant that an order for production was necessary. In the circumstances it would be right for the court to imply an undertaking even though Bourns disclosed the documents without an order being made. In my judgment where a party to taxation discloses to a payer documents for the purpose of the taxation which are relevant to an issue and therefore should in the interests of justice be disclosed, an implied undertaking arises so that the documents can only be used for the purposes of those proceedings. That happened in this case: therefore the documents were disclosed subject to that undertaking.
It is curious that the Bourns appeal, the very case which the joint judgment in Hearne expressly references in support of the notion that the compulsion need not be sourced in a court order or rule, refers to Prudential Assurance in which Hobhouse J found that witness statements and experts' reports served pursuant to a direction in accordance with the court rules are not served under compulsion.

[20]

Central Queensland Cement

Central Queensland Cement is a judgment of McPherson J of the Supreme Court of Queensland on the plaintiff's application for an interlocutory injunction to prevent the use of a witness statement provided by the plaintiff to the defendant pursuant to a practice direction made by the court requiring the service of signed witness statements in advance of the trial. After the service of the witness statement, reports appeared in the press and other media from which McPherson J drew the inference that the authors of those reports had seen the witness statement or at least part of it and that they obtained it from the defendant.
It is notable that this is a judgment on an application for an interlocutory injunction and the reasons are very briefly expressed, barely occupying more than two pages in the authorised report.
At 510 McPherson J described the basis for the interlocutory injunction in the following way: [The plaintiff] founds its claim on the analogy with the use of a document produced on discovery in an action. As to such a document, it is well settled that a party who inspects a document so discovered and produced does so under an implied undertaking or obligation that he will not use it for a collateral or ulterior purpose: see Nicol v. Brisbane City Council [1969] Qd.R. 371, 377; Harman v. Home Office [1983] 1 A.C. 280, at 304, and authorities there cited.
The defendant argued that the implied undertaking only applied to discovered documents and should not be applied to witness statements. In holding that the interlocutory injunction should be granted, McPherson J rejected this argument at 510-511, saying: However, the underlying principle is in my view plain enough. It is that a document furnished for use for one purpose may not legitimately be used for another. That is, I conceive, what was meant by Lucas J. when, in Nicol v. Brisbane City Council, he spoke of not using the document for any "collateral or ulterior purpose". I take that to mean any purpose collateral or ulterior to the purpose which the document or its production or delivery is intended to serve. In this case there can be no doubt that that purpose is the proper conduct of the litigation. I am therefore in no doubt that the undertaking applies equally to the witness statement by Mr Town as it would to any other document produced by one side to the other for the purpose of litigation. Indeed, one can very well see how it would apply with equal force to the answer or answers to interrogatories delivered in an action, that being a form of compulsory disclosure commonly resorted to in proceedings in this Court. I cannot see any distinction in nature or substance between such an answer and the present witness statement of Mr Town. At one time, of course, the practice in equity was such that the answers to interrogatories were the only form of evidence used in those proceedings. One has only to look at the Practice Direction and use the experience that all of us have in trying actions in the commercial causes jurisdiction to realise that these procedures are available and are intended for use only for the purpose of properly conducting the litigation, and for no other. Once that conclusion is reached the rest follows as a matter of course. A document of this kind, delivered as it was for a particular purpose, may not be used for another purpose. That is an aspect of a general principle not confined to documents delivered for the purpose of litigation. …
It is noteworthy that whilst Central Queensland Cement (on which the joint judgment in Hearne relied) held that the implied undertaking applied to a witness statement served pursuant to a court rule, the width of the principle expressed in that case ("a document furnished for use for one purpose may not legitimately be used for another") does not find anything like that formulation in the principle stated in the joint judgment at [96] in Hearne.

[21]

Springfield Nominees

Springfield Nominees is a decision of Wilcox J of the Federal Court of Australia. It also involved a witness statement served pursuant to a direction of the court that witnesses' statements be exchanged before trial. In that case the proceedings settled before the witness statement was tendered as an exhibit in open court. An application was then made by a company that was not a party to those proceedings, seeking leave to use the witness statement in other proceedings.
Wilcox J referred to the cases cited in argument, including Harman and Central Queensland Cement (the latter reference being to the second paragraph, "I am therefore in no doubt … for no other", quoted above), and said at 223: I respectfully agree with McPherson J. In addition to the points made by his Honour I add that a witness statement fulfills a function very similar to that of an affidavit or an admission of facts. In this court there is a rule (O 46, r 6) limiting the documents on court files which may be inspected without leave of the court or a judge. They include affidavits, interrogatories and answers to interrogatories, lists of documents given on discovery and admissions. All are documents brought into existence for the purpose of the instant litigation which may contain confidential or personal information and which may, or may not, ultimately be read in open court. There is every reason for subjecting their use to the same constraints. Conformably with Central Queensland Cement and the position of both the present parties, I hold that the statement of Mr Preston may not be used by Hongkong Bank in its defence to the Aetna proceeding without his consent or leave of the court.
The important points arising from Springfield Nominees are that Wilcox J considered a witness statement to be functionally similar to an affidavit and there existed a court rule which prevented access to the court file without leave, that file containing documents brought into existence for the proceedings which should be treated the same. Yet the parties did not put in contest the issue of whether or not that the implied undertaking applied to the witness statement. They both agreed that it did. So, as in Hearne itself, there is a limit on the value of Springfield Nominees as a decision providing a principled basis for determining that question.
Further, as in the case of Central Queensland Cement, the fact that a witness statement provided pursuant to a court direction was the subject of the implied undertaking was relied upon by Hayne, Heydon and Crennan JJ in Hearne at [96], yet the expansive notion that a document provided for one purpose cannot be used for another is not embraced in the principle which their Honours express. Nor does any aspect of that principle depend on what documents can and cannot be accessed on the court file.

[22]

Smoothdale

Smoothdale is a judgment of the Full Court of the Supreme Court of South Australia on the application of the appellant for an order that the respondent produce seven witness statements which had been brought into existence in proceedings in this court involving the respondent. The respondent had provided those witness statements to the other party in this court in accordance with an order made by this court pursuant to a Practice Note which required the delivery of a witness statement containing the evidence proposed to be led from each witness.
When called upon to provide the witness statements to the appellant, the respondent claimed legal professional privilege in relation to the witness statements. The appellant conceded before the primary judge that the witness statements were privileged but contended that the delivery of the witness statements to the other party in the proceedings in this court was a waiver of the privilege. The primary judge held that there had been no waiver. The question the court had to decide was whether the documents were protected from production on the basis of that privilege.
The Full Court (King CJ, with whom Mullighan and Nyland JJ agreed) held that there was no waiver, express or implied, in the provision of the witness statements. In the course of doing so, King CJ at 229 said: There is an obligation on the recipients of documents pursuant to the discovery process not to disclose those documents or their contents for a collateral purpose: Harman v Secretary of State for the Home Department [1983] 1 AC 280; Crest Homes plc v Marks [1987] AC 829 at 853; Holpitt Pty Ltd v Varimu Pty Ltd (1991) 29 FCR 576. That obligation extends to the recipient of documents pursuant to an order of the court of the present kind; Springfield Nominees Pty Ltd v Bridgeland Securities Ltd (at 691). The documents therefore could not be disclosed for a collateral purpose and could not be put in evidence by the other parties without leave of the court.
As stated above, although the Full Court in Liberty Funding at [24] expressed that there was a real issue in relation to the correctness of the decision in Smoothdale, that doubt was said to be limited to the question of waiver at common law by service of statements (or affidavits) of witnesses in advance of the trial.
The Full Court in Smoothdale relied on the decision in Springfield Nominees to express that a recipient of a witness statement given pursuant to an order of the court is subject to the implied undertaking. That question does not appear to have been the subject of contest in Smoothdale. As I have already observed, that question was also not debated by the parties in Springfield Nominees, nor was it debated in Hearne.

[23]

Medway

In Medway the plaintiff had been involved in earlier proceedings brought by his former wife in the Family Division to vary a maintenance agreement in which he was ordered to swear affidavits of his means. The plaintiff also controlled a company which later brought proceedings in the Queen's Bench Division and applied for summary judgment. The defendant in those proceedings sought a stay of the proceedings pending the plaintiff's company providing security for costs, supporting the stay application with an affidavit which exhibited the plaintiff's affidavits of means from the earlier proceedings, which had been obtained from the wife's solicitor. The plaintiff then made an application to restrain the defendant from disclosing or making use of his affidavits.
In Medway, Goulding J decided that the disclosure and use of the affidavits compelled to be produced by process of law should be restrained. At 713 Goulding J referred to the passage from Lord Denning MR's judgment in Riddick at 896 quoted above regarding the competing public interests, and then said at 713-714: … It is perfectly true that the language of implied undertaking has been used in the authorities discussing the principle I have already mentioned, but as I understand the before cited statements made by Talbot J [in Distillers Co (Biochemicals) Ltd v Times Newspapers Ltd ([1975] 1 All ER 41 at 48, [1975] QB 613 at 621] and in the Court of Appeal [in Riddick v Thames Board Mills Ltd ([1977] 3 All ER 677 at 687, [1977] QBD 881 at 896] it rests on a wider ground, namely, that public interest requires that a party, compelled by process of law to make what may be damaging disclosures for the purpose of a particular suit, should not thereby be at risk of their use for other purposes. It is a strong thing, though necessary for matrimonial litigation, to make a man disclose all the details of his means. It seems to me that many husbands, and in these days perhaps many wives, would find it difficult to be frank with the court if adversaries in business, for example, could freely obtain and use the disclosures made in matrimonial litigation. … … In all matters of this sort it appears to me that there is a balance of public interest to be considered. I take as an example what was said by Lord Diplock in a recent decision of the House of Lords in D. v. National Society for the Prevention of Cruelty to Children [1977] 2 W.L.R. 201, 207: "The fact that information has been communicated by one person to another in confidence, however, is not of itself a sufficient ground for protecting from disclosure in a court of law the nature of the information or the identity of the informant if either of these matters would assist the court to ascertain facts which are relevant to an issue upon which it is adjudicating: Alfred Crompton Amusement Machines Ltd. v. Customs and Excise Commissioners (No. 2) [1974] A.C. 405, 433, 434. The private promise of confidentiality must yield to the general public interest that in the administration of justice truth will out, unless by reason of the character of the information or the relationship of the recipient of the information to the informant a more important public interest is served by protecting the information or the identity of the informant from disclosure in a court of law." To my mind, in the present case it is necessary to weigh against one another not two competing interests, public or private, but two applications of the same public interest in different sets of proceedings. It is what Lord Diplock described in the passage I have just read as the general public interest that in the administration of justice truth will out. Clearly that interest, if I am right, requires that disclosure of means made by parties under compulsion of the court or the rules in matrimonial proceedings should be treated as confidential. The obedience of those engaged in matrimonial suits to the requirements of the law is thereby much encouraged. But the same public interest of the full disclosure of information in litigation may be said to require a court - in this case the Queen's Bench Division - when considering whether a plaintiff company should provide security for costs, to have before it the fullest information of the company's circumstances. The competition between those two applications of the one principle does not seem to me at all difficult to resolve. Matrimonial proceedings are of great public importance as involving the status of the parties and the future provision to be made for one or both, often for their whole lives. On the other hand, the giving of security for costs, although of course important to a defendant, is a relatively minor matter of litigation habitually dealt with by masters on comparatively slight evidence on either side and not normally the subject of lengthy investigations or full discovery. It seems to me therefore that if I am right in my understanding of the court's duty on the present application, the plaintiff's argument ought to prevail and the defendants should be restrained from making use of the copy affidavits which they have obtained.
Clearly, the decision in Medway was one grounded in the compulsion under which the plaintiff was required to provide the affidavits.

[24]

Addstone

Addstone is a decision of Mansfield J of the Federal Court of Australia. Mr Macks was the liquidator of the Emanuel Group of companies who applied for a direction as to whether he had the power under the Corporations Law to enter into funding arrangements to conduct litigation against particular creditors in the Supreme Court of South Australia. In the application Mr Macks relied on four affidavits sworn by him and another affidavit sworn by another person. Orders were made that the affidavits and the transcript of hearing were confidential and not available for inspection. The court ordered that Mr Macks had the power sought and gave Mr Macks, the creditors and the contributories of the Emanuel group an extension of time within which to apply to set aside particular transactions. The creditors against whom the action was brought then applied for access to the confidential affidavits, which Mr Macks agreed to provide. The issue to be decided was whether the creditors should only be entitled to use the information provided in their capacity of creditors and not as defendants in the proceedings against them.
Expressing the principles to be applied, in Addstone Mansfield J said at 160: There was really only one remaining issue of contention between the parties, namely the requirement that the applicant creditors should only be entitled to use the information provided in the capacity as creditors, and not as defendants to the new Supreme Court action. I do not think it is necessary to accede to the liquidator's submission that I should impose that condition at this point. The order to produce the information in issue will be the equivalent of an order for discovery. The normal implied undertaking that the documents will not be used other than in respect of any application exercising further the liberty to apply reserved to the creditors when orders were made on 9 June 1998, and not to use those documents for a collateral purpose, will therefore apply: Esso Australia Resources Ltd v Plowman (Minister for Energy and Minerals) (1995) 183 CLR 10; 128 ALR 391; Harman v Secretary of State for the Home Dept [1983] 1 AC 280; Holpitt Pty Ltd v Varimu Pty Ltd (1991) 29 FCR 576; 103 ALR 684. That implied undertaking has been held to apply in respect of documents produced under subpoena by a non-party: Telnet Pty Ltd v Takapana Investments Pty Ltd (1994) 51 FCR 520, and to documents produced to the Administrative Appeals Tribunal under summons: Otter Gold Mines Ltd v McDonald (1997) 76 FCR 467; 147 ALR 322. I see no reason why it should not apply in respect of material directed to be disclosed by the court. In Springfield Nominees Pty Ltd v Bridgelands Securities Ltd (1992) 38 FCR 217; 110 ALR 685, Wilcox J applied that undertaking to a statement exchanged between parties as proposed evidence, but which was not in fact adduced in evidence. His Honour noted that Central Queensland Cement Pty Ltd v Hardy [1989] 2 Qd R 509 was to the same effect, as was Ainsworth v Hanrahan (1991) 25 NSWLR 155 in relation to answers to interrogatories.
The decision in Addstone therefore turned on the order to produce the affidavits being equated with discovery.

[26]

Helicopter Aerial

In Helicopter Aerial Surveys Pty Ltd v Garry Robertson [2015] NSWSC 2104, Brereton J as a single judge of this court considered the application of the principle in Hearne as well as the decisions in Bourns, the Bourns appeal, Central Queensland Cement, Springfield Nominees, Medway and Addstone. The context was an application by the plaintiff company against a former employee for alleged misuse of confidential information, in the course of which proceedings the parties had sworn and served affidavits and the plaintiff had informally produced documents without an order for disclosure.
The two principal issues for determination were whether the implied undertaking attaches to documents produced by way of disclosure by the plaintiff under informal arrangements in the absence of an order for discovery or other compulsory process and, if it did, whether the defendant should be released from it.
In Helicopter Aerial at [9]-[10], Brereton J commenced the analysis of the first issue by referring to the passage of the judgment of Hayne, Heydon and Crennan JJ at [96] in Hearne and observing that: … the touchstone of the obligation appears to be that of compulsion … although in some of the cases, another strand that appears in the reasoning is simply that a document that is obtained for one purpose should not be used for another [see Central Queensland Cement and Springfield].
Brereton J then said at [12]: In principle, a party who voluntarily produces documents by way of disclosure for the purpose of proceedings in response to an informal request to do so, and thereby obviates the need for the additional costs, expense and time involved in an application for disclosure pursuant to compulsory process, ought not be disadvantaged in terms of the use that can be made of the documents by having adopted that course. Indeed, such a cooperative approach should be encouraged and facilitated, rather than discouraged.
At [13]-[16] of Helicopter Aerial, Brereton J noted that the decision in Bourns, which had been footnoted in Hearns at [96], quoted the passage from Bourns at [19] by Laddie J (which is set out above) and also noted that it had been affirmed in the Bourns appeal. Brereton J concluded at [17]: In my view, that case and circumstances are closely analogous to the present. Although an immediate legal obligation to produce the documents for inspection may not have crystallised, they were produced in the context where disclosure could have been obtained if it were not provided voluntarily by one of the various processes to which I have referred. The documents should be treated in that context as having been produced under compulsion and subject to the implied undertaking. The implied undertaking should in principle be regarded as attaching not only to documents produced as a result of the actual invocation of compulsory process, but equally to documents produced in response to an informal request for disclosure in the context of proceedings in which, but for informal disclosure, a formal order could have been obtained.
It was then necessary for Brereton J to determine the defendant's application for leave to use the affidavits served, and open correspondence sent, by the plaintiff in the proceedings, or the information contained in them, for the purposes of related proceedings. Brereton J commenced the consideration by stating at [30]: So far as the balance of the defendant's application is concerned, the documents to which it refers are, essentially, affidavits in the proceedings and open correspondence in the proceedings. I do not think it has ever been suggested that the implied undertaking attaches to open correspondence. For my part, I doubt that it attaches to affidavits, other than affidavits which disclose information in answer to an order or rule that requires information to be disclosed.
At [31]-[32] Brereton J returned to the expression of principle in Hearne at [96] and the reference to "witness statements served pursuant to a judicial direction and affidavits" for which support for the latter was cited in the decisions of Medway and Addstone. Brereton J reviewed the reasons stated in Medway at [31] (concluding that the affidavit in that case was a form of compulsory disclosure) and Addstone at [32] (concluding that the subject matter happened to be an affidavit, but the circumstances were not that of an affidavit served in the ordinary course of proceedings for use in the hearing). Brereton J then said at [33]: Accordingly, in my view, the two cases referred to in Hearne v Street provide scant, if any, support for a general proposition that the principle extends to affidavits served in the ordinary course of litigation.
At [34] Brereton J then considered the decisions in Central Queensland Cement and Springfield Nominees, emphasising that the latter rested on the reasoning in the former to the effect that "the practice directions pursuant to which the witness statements were served were a means of making information available only for the purpose of the proper preparation and conduct of the litigation".
At [35]-[36] Brereton J reviewed the reasoning in Smoothdale, finding that the crucial observation was that a witness statement remained confidential and privileged in the hands of the party who obtained it from the witness and the implied undertaking applies to witness statements until they are deployed in open court because of their initial confidential and privileged character.
Brereton J contrasted an affidavit with a witness statement, saying at [37]: … An affidavit is a written statement made by a person who swears or affirms before a duly authorised functionary that the statement is true. Historically, in the Court of Chancery, where evidence was generally given on affidavit, the affidavit was the testimony of the witness. Indeed, if the affidavit was lost, the evidence was lost. Although nowadays, for reasons of convenience, affidavits may be sworn before solicitors - even before the solicitor acting for the party making the affidavit, though that is often regarded as undesirable as a matter of practice - historically that was not permitted; thus, the swearing of the affidavit took place not privately but before a functionary, such as a Commissioner for Affidavits or Justice of the Peace. And the affidavit is not mere advance notice of the evidence that it is expected a witness will give, but is the evidence of the witness. It is made, unlike a witness statement, not in the context that it might be regarded as confidential until and unless required to be deployed, but on the basis that it will serve as a person's sworn evidence in proceedings. As is observed in Wigmore on Evidence (1972, 4th ed, Chadbourn Revision) at paragraph 1331, in theory, the testimony or deposition was the writing and nothing else. In Daniell's The Practice of the High Court of Chancery (vol 1, 4th ed) at pages 824-825, it was observed that an affidavit must be made in some cause or matter actually pending at the time it is sworn, and otherwise cannot be received. While that has been departed from in some respects in the modern law, that reveals another distinction between an affidavit and a witness statement, and reinforces the view that an affidavit sworn in proceedings is not a confidential, let alone privileged, document. These matters place an affidavit in a markedly different position from a witness statement.
Having reviewed Hearne and the decisions on which it is expressed to be based, Brereton J stated at [39]: Accordingly, I seriously doubt whether in principle the implied obligation attaches to affidavits sworn and served in the ordinary way in the course of proceedings. By reference to "the ordinary way", I exclude affidavits sworn in response to orders for disclosure, such as of the type referred to in Medway v Doublelock. But, in referring above to "the ordinary course", I do not regard a mere timetable requiring affidavits to be used in proceedings to be served by a particular date as amounting to compulsory process. Such a timetable does not compel a party to disclose information that it does not wish to disclose, and it does not compel a witness to disclose any information; it simply fixes a time by which any evidence to be relied on must be served. It is quite distinct from an order which requires a party to make an affidavit deposing to certain matters, which would amount to compulsory process in the relevant sense.
Brereton J at [40] observed that the High Court in Hearne did not have to decide whether the implied undertaking applied to the affidavit and expert's report because it was not in contest.
Having conducted the lengthy review, Brereton J stated that as a single judge his Honour was bound by the statement of principle in Hearne, at [41] saying: While the High Court did not have to decide this particular question, in circumstances where it upheld the decision based on the application of the principle to, inter alia, an affidavit, I ought not, sitting at first instance, depart from that position. Thus, I will proceed on the basis that affidavits do attract the implied undertaking. And, in any event, given the judgment of the High Court in Hearne v Street, a litigant would act very reasonably in proceeding on that basis.
Brereton J then explained at [42] that the issue concerning the characteristics of an affidavit become relevant to the question of whether leave should be granted to use it for another purpose, saying: However, it seems to me that the voluntary nature of the affidavit, the intent that it be used and read in open court, and the circumstance that it is not a confidential, let alone privileged document, are highly relevant to the approach that one takes on an application for leave to use the material for an extraneous purpose.
The conclusion that Brereton J reached in Helicopter Aerial was that the specified use of the plaintiff's affidavits by the defendant should be permitted.
I do not consider myself to be bound by the High Court in Hearne in the same way that Brereton J considered that he was bound on the question of whether an affidavit provided in the ordinary course is subject to the implied undertaking. As I have already stated above, that question was not decided in Hearne because the parties did not put the issue in contest and the High Court assumed the position to be that the implied undertaking did apply. The application of the principle in Coleman and CSR as described above means that I am not bound by the ratio decidendi in Hearne on that issue.

[28]

Sinnott

Sinnott v Chief of Defence Force [2020] FCA 643 involved Ms Sinnott as a former member of the Royal Australian Air Force (RAAF) bringing proceedings in the Federal Court of Australia for judicial review of a decision made by the Chief of Defence Force (CDF) not to permit her re-enlistment as a member of the RAAF. The application, including a request for an extension of time, was filed with accompanying affidavits made by Ms Sinnott and by her solicitor respectively. An order limiting access to the solicitor's affidavit was made at the first case management hearing.
The judicial review application was resolved without the hearing taking place. The CDF then applied to use the solicitor's affidavit for the purposes of investigating and considering any security, disciplinary or administrative issues that might arise from its contents and to provide a copy of it to the Queensland Legal Services Commissioner for the purposes of any investigation or consideration of issues.
In Sinnott, Logan J at [23] referred to Liberty Funding and its reliance on Springfield Nominees in respect of the factors to be considered on an application to be released from the implied undertaking and at [24] observed: The reference in Liberty v Phoenix to the "implied undertaking" is a reference to a limitation which is sometimes described by reference to the United Kingdom case Harman v Home Department State Secretary [1983] 1 AC 280, as a "Harman undertaking". That case, at least in Australia, in terms of an implied undertaking is now better understood, in light of Hearne v Street (2008) 235 CLR 125 (Hearne v Street ) at [3] per Gleeson CJ and at [96] and [105] to [108] per Hayne, Heydon and Crennan JJ, as a substantive obligation of law.
At [25] in Sinnott, Logan J quoted the joint judgment in Hearne at [96] and at [26] Logan J concluded that the solicitor's affidavit was "necessarily filed and served in support of the application for an extension of time, as well as in relation to the substantive application". Logan J considered at [28] that the document annexed to the affidavit "was an advanced form of discovery of a relevant document".
Logan J found that the solicitor's affidavit was subject to the implied undertaking, saying at [29]: I consider that I am bound by Liberty v Phoenix and Hearne v Street to hold that the CDF is bound not to use the December affidavit for other than the purposes of the present proceeding unless he obtains the leave of the Court. The position is subject to what McPherson J in Central Queensland Cement Pty Ltd v Hardy [1989] 2 Qd R 509 (Central Queensland Cement) described as an underlying principle, which was, at p 510, that: "… a document furnished for use for one purpose may not legitimately be used for another." In Springfield Nominees, Wilcox J expressed agreement with that observation by, and the reasoning of, McPherson J in Central Queensland Cement in terms I have noted. Wilcox J's judgment is cited with evident approval by the Full Court in Liberty v Phoenix.
As I have stated above, none of the decisions in Central Queensland Cement, Springfield Nominees, Liberty Funding or Hearne can be regarded as binding decisions on the question of whether or not an affidavit provided in the ordinary course of proceedings is subject to the implied undertaking because that question was not the subject of debate before the court in each case. Further, I do not think that Hearne supports any formulation of the principle that found its expression in Central Queensland Cement and Springfield Nominees to the effect that a document furnished for use for one purpose may not legitimately be used for another. For this reason, I consider the decision in Sinnott to be of limited relevance to what I must determine in this case.

[29]

Frigger

In Frigger v Trenfield (No 5) [2020] FCA 827 Jackson J of the Federal Court of Australia determined an application for contempt brought by the applicants against the respondent trustee of their bankrupt estates for an alleged breach of the implied undertaking in relation to documents attached to an affidavit filed by the applicants in support of their originating application in the proceedings, which the respondent sent to the Australian Taxation Office. Jackson J decided that the affidavit was not subject to the implied undertaking.
At [14]-[18] Jackson J assessed the relevant court rules and practice directions and concluded that the affidavit was not required to be filed by any rule of court or practice direction and "[o]n no view, then, was Mrs Frigger compelled to file an affidavit annexing the two documents that are the subject of the charges".
Jackson J had regard at [20]-[24] to the principle expressed in Hearne and its references to Harman and Esso, determining at [24] that Hearne supported the proposition that the "implied undertaking does not extend to a document, including an affidavit, filed at a party's initiative and discretion rather than as a consequence of any compulsion".
Jackson J then considered what his Honour at [24] called "a competing line of authority", which was said at [33]-[34] to derive from the statement in Central Queensland Cement that "a document furnished for use for one purpose may not legitimately be used for another". Jackson J at [36] observed: … But McPherson J's statement puts the principle more widely than it was subsequently stated in Hearne v Street. And it puts it in a form - "a document furnished for use for one purpose may not legitimately be used for another" - which does not anchor it to any doctrinal basis, such as those that have evolved in connection with limiting the incursions on privacy which can follow from the processes of the court. As straightforward as the underlying principle may be as a rule of common sense or fair dealing, it does not follow that it is the rationale for the substantive legal obligation that was the subject of Harman v Home Department. McPherson J may have intended to refer to it as an underlying principle which helps explain more specific operative rules, rather than as a rule of that kind.
At [39] Jackson J rejected the width of the proposition said to derive from Central Queensland Cement, stating: For those reasons, and conscious of the great respect which must be given to any judgment of McPherson J, I do not consider that Central Queensland Cement is a sound basis for any general principle that any document provided for the purpose of litigation can only be used for that purpose, on pain of contempt of court, regardless of whether the document was provided under any kind of compulsion.
Jackson J at [40]-[43] referenced the reliance of Springfield Nominees on Central Queensland Cement. Jackson J considered at [46] that as both Central Queensland Cement and Springfield Nominees pre-date Hearne, they must be considered with that in mind and importantly: [i]t is worth noting that while [Central Queensland Cement and Springfield Nominees] were cited as authority in the key statement of principle in Hearne v Street …, they were cited in support of the proposition that the implied undertaking applies to "witness statements served pursuant to a judicial direction" and in the case of Central Queensland Cement, also in relation to answers to interrogatories.
The decision in Sinnott was next in Jackson J's consideration at [47]-[49], noting its reliance on Liberty Funding and concluding that the parties in Sinnott accepted that leave to use the affidavit was required and that Logan J in Sinnott was influenced by the clear requirement in the court rules that the affidavit be filed and by his Honour's characterisation of the annexure to the affidavit as an advanced form of discovery.
At [50] Jackson J noted that the Full Court in Liberty Funding was not called upon to consider whether the implied undertaking applied to the affidavit, and that the affidavit was filed pursuant to an order of the court specifically requiring the affidavit to be filed dealing with a particular subject. Jackson J concluded that the affidavit had been provided under direct compulsion by the power of the court and it was an application for leave to use the affidavit, when it was common ground that leave was required.
Jackson J said at [52]: For those reasons, I do not consider that Sinnott v Chief of Defence Force or Liberty Funding Pty Ltd v Phoenix Capital Ltd stand for the proposition that a document which has been voluntarily disclosed for the purposes of litigation attracts the implied undertaking.
The final case to which Jackson J referred was the decision of Brereton J in Helicopter Aerial, which was the subject of detailed consideration at [55]-[58], with his Honour commenting at [56]-[57]: [56] Nevertheless, Brereton J went on to refer to the affidavit that was the subject of the decision in Hearne v Street. His Honour noted that in that case, the High Court did not have to decide whether the implied undertaking did apply to the affidavit in question because, as I have already explained, there was no dispute about that. But his Honour held (at [41]): "While the High Court did not have to decide this particular question, in circumstances where it upheld the decision based on the application of the principle to, inter alia, an affidavit, I ought not, sitting at first instance, depart from that position. Thus, I will proceed on the basis that affidavits do attract the implied undertaking. And, in any event, given the judgment of the High Court in Hearne v Street, a litigant would act very reasonably in proceeding on that basis." [57] However this must be understood in the context that Brereton J was dealing with an application for leave to use the affidavits, and he ended up giving that leave. I read the statement just quoted as going no further than saying that in view of Hearne v Street, Brereton J (and the parties) were justified in assuming that the implied undertaking applies to affidavits served in the ordinary course of litigation. Since the point was not in issue in Hearne v Street, the fact that the High Court proceeded on the basis that the implied undertaking applied did not bind Brereton J and does not bind this court: see CSR Ltd v Eddy [2005] HCA 64; (2005) 226 CLR 1 at [13]. Nor did the High Court express any view on the subject, which a court of first instance should follow, whether or not it is strictly bound to do so. [58] In any event, it seems from his Honour's comments in [39] quoted above that he was dealing with affidavits served pursuant to a direction of the court, as was the High Court in Hearne v Street. That distinguishes both Hearne v Street and Helicopter Aerial Surveys from the present case. I do not consider that the latter case requires this court to hold that Mrs Frigger's affidavit of 6 March 2019 was subject to the implied undertaking.
In Frigger at [61]-[62], Jackson J rejected the notion that the decision in Central Queensland Cement stood for the proposition that the mere fact that an affidavit is provided for the purposes of litigation means that it is subject to the implied undertaking and a contempt of court to use it for any other purpose. At [62] Jackson J said: For reasons I have given, I do not consider that Central Queensland Cement, or the general approval it has received in subsequent decisions, compels that outcome. Nor do I think that outcome would be warranted. With respect, I share the doubts that Brereton J expressed in Helicopter Aerial Surveys as to whether the implied undertaking does or should apply to affidavits filed in the ordinary course of litigation. And it would be a sweeping step for a court to say that the mere fact that a document has been served for the purposes of litigation means it is a contempt of court to use it for any other purpose. That would seem to entail that every document filed in court attracts the obligation. That would be wider than the rationale of the rule expressed in Hearne v Street and the established authorities cited in that decision, namely that it would be inequitable if a party were compelled by court process to produce documents for the purposes of the litigation yet be exposed to their use for other purposes: see Esso Resources Ltd v Plowman at 33 (Mason CJ).
Jackson J then considered at [63] what is meant by the concept of "compulsion" as used in Hearne, rejecting the view that the courts apply it narrowly, as demonstrated by the reference to Bourns in Hearne to support the principle that compulsion can arise "otherwise" than from a rule of court or a specific order of the court.
At [64] Jackson J found that the implied undertaking did not apply the affidavit in question before his Honour, rejecting the argument that it would be enough to amount to compulsion for a litigant to say that it was necessary to file the affidavit to vindicate rights or to defend a claim, and concluding: … On the analysis of the implied undertaking set out above, that cannot be enough to give rise to the obligation. It is, rather, an intrusion by the court into the rights of a party not to disclose private documents which is essential to the obligation. …

[31]

Silverstein

The Queen, on the application of Davey v Silverstein [2020] VSCA 233 is a decision of the Court of Appeal of the Supreme Court of Victoria. It dealt with an appeal from contempt claims. It has a complicated set of facts, not all of which require exposition for the purposes of this judgment.
Mr Davey was a solicitor in Victoria. He was declared bankrupt in February 2014.
In 2016 Mr Davey commenced debt recovery proceedings, whilst an undischarged bankrupt, in the Magistrates Court against Mr Dessman and Dessco Pty Ltd, alleging that they owed him legal fees for legal services provided to them. In February 2017, Mr Silverstein commenced to act as solicitor for Mr Dessman and Dessco Pty Ltd in the debt recovery proceedings. During the debt recovery proceedings, Mr Davey filed three affidavits.
In September 2016, Mr Davey commenced preliminary discovery proceedings in the Magistrates Court seeking documents from Australian Conservation Services Pty Ltd (ACS), a trustee company of a trust of which Mr Davey was the principal beneficiary, due to his concern that ACS was attempting to sell the main property asset of the trust. During the preliminary discovery proceedings, Mr Davey filed one affidavit in support of his application.
Mr Silverstein acted for ACS in proceedings which it had brought in the Supreme Court of the Australian Capital Territory and also acted for Mr Davey's father relating to matters concerning the trust.
As part of an effort to ensure that the bankruptcy of Mr Davey was not discharged, Mr Silverstein sent copies of the three affidavits which had been filed in the debt recovery proceedings and the affidavit which had been filed in the preliminary discovery proceedings to the trustee in bankruptcy of Mr Davey.
Mr Davey brought proceedings in the Supreme Court of Victoria seeking orders that Mr Silverstein, Mr Dessman and Dessco Pty Ltd be found guilty of contempt of the Magistrates Court by, amongst other matters, breaching their obligation to the Magistrates Court not to use the affidavits created in the course of litigation, or otherwise without the permission of the court, or the information contained in them for any purpose not directly connected with the conduct of the proceedings.
At first instance, the contempt application was dismissed and Mr Davey was ordered to pay costs. The trial judge found that two of the affidavits in the debt recovery proceedings were filed by Mr Davey to support the summary judgment application as required by the rules of the Magistrates Court and the affidavit in the preliminary discovery proceedings was also filed by Mr Davey pursuant to the rules of the Magistrates Court. The trial judge held that although each of the rules required those affidavits be filed in support of each application, they did not compel each application to be made and therefore those affidavits were not subject to the implied undertaking. The trial judge also found that it was not clear why the third affidavit had been filed in the debt recovery proceedings, that it was not filed in accordance with a court order and therefore held that the affidavit was filed voluntarily in the debt recovery proceedings and was not subject to the implied undertaking.
The joint judgment in Silverstein was given by Kyrou, Kaye and McLeish JJA. At [59] their Honours summarised the issue before the court in this way: In the contempt proceeding, and on this application, the competing contentions, concerning the application of the Harman undertaking, proceeded on the basis that that undertaking extends to and covers all documents which have been filed, served or produced to the Court in a proceeding by compulsion. The issue before the primary judge, and on this application, concerned what is meant by 'compulsion' in that context, and in particular whether the three affidavits, that were filed in support of the application for summary judgment in the debt recovery proceeding, and the affidavit that was filed in support of the application for preliminary discovery against ACS in the Magistrates' Court, were, in effect, filed and served by 'compulsion'.
The joint judgment in Silverstein at [60]-[68] contains an analysis of Harman, the implied undertaking stated in it and the subsequent cases which have considered the rationale for it before arriving at the judgment of Hayne, Heydon and Crennan JJ in Hearne at [96]-[97]. In turn, in Silverstein at [69]-[76] the judgments in Bourns, the Bourns appeal, Central Queensland Cement, Springfield Nominees, Smoothdale, Medway and Addstone were analysed and then conclusions arising from them expressed at [77]-[78] as follows: [77] The foregoing review of the cases, cited by Hayne, Heydon and Crennan JJ in Hearne, demonstrates the nature and elements of documentary disclosure which courts regard as having been made under compulsion, for the purposes of the application of the Harman undertaking to those documents. Of course, those categories are not closed. As the type and nature of remedies available to parties develop and expand, the classes of disclosures, which fall within the principle stated in Harman, will also develop. [78] Nevertheless, the review of the cases, which we have undertaken, demonstrates that the affidavits, that were filed in the two Magistrates' Court proceedings ― the debt recovery proceeding and the third party discovery proceeding ― and which are the subject of ground 1, fall well outside the scope of documents to which the Harman principle has been held to apply. The cases do not support the conclusion that every affidavit filed in compliance with a rule of court is relevantly produced under compulsion.
The appeal judges in Silverstein at [82] also regarded the decision of the Full Court in Liberty Funding to be relevant to their analysis of Hearne, saying (footnote omitted): The decision of the Full Court of the Federal Court in Liberty Funding Pty Ltd v Phoenix Capital Ltd is also consistent with our analysis of the approach taken by the plurality in Hearne. In that case, the appellants were applicants in a proceeding ('the first proceeding') in the Federal Court against the respondent claiming relief in respect of a document disseminated by the respondent, which it was alleged contained erroneous and misleading information about the applicants' products. In that proceeding, the applicants had sought an order for specific discovery of documents concerning the extent of dissemination of the relevant document. In order to facilitate a mediation, the judge, who managed the proceeding, made an order that the respondent file an affidavit dealing with the dissemination of that document. In due course, following a mediation, the first proceeding resolved. Subsequently, the second applicant in the first proceeding and another party commenced a new proceeding against the respondent in the Federal Court alleging wrongful use of the applicant's confidential information and breach of copyright. Those proceedings were subsequently transferred to the Supreme Court of Victoria. The applicants wished to use, in that proceeding, the affidavit that had been sworn on behalf of the respondent in the first proceeding. The Full Court of the Federal Court held that the affidavit was covered by the Harman undertaking. The Court stated: The … affidavit was intended to fulfil the role (albeit somewhat extended) of an affidavit of discovery. It was intended to be read and relied on by the other side in the litigation. … The affidavit was not brought into existence as part of the anticipated evidence for a hearing, whether final or interlocutory. It was intended to be a convenient procedural device in the nature of, but in lieu of, a usual affidavit of discovery. That is sufficient, we think, to distinguish … cases [which] dealt with the status of proposed evidence served in advance of the trial.
The appeal judges in Silverstein at [83]-[84] specifically rejected the proposition as found in Sinnott by Logan J that an affidavit filed and served in support of an application for an extension of time was "necessarily" so filed and served and that Logan J was bound by Liberty Funding and Hearne to hold that such an affidavit was subject to the implied undertaking. The appeal judges stated at [84]: With respect, based on our review of the authorities, we doubt that the decision of the Full Court of the Federal Court in Liberty Funding, or the principles stated by the plurality in Hearne, support the proposition that such an affidavit was one filed and served by material 'compulsion' for the purposes of the Harman undertaking. Rather, the decision by Logan J extends that concept beyond the meaning ascribed to it in the cases which we have discussed.
Applying this reasoning, in Silverstein at [85], [86] and [90] Kyrou, Kaye and McLeish JJA held that because Mr Davey was under no compulsion to make the application for summary judgment in the debt recovery proceedings or the application in the preliminary discovery proceedings, the requirements in the respective rules that each such application must be filed with an affidavit in support did not provide any basis for the implied undertaking to apply to them and there was no contempt.
At [87] in Silverstein, the Court of Appeal specifically contrasted the nature of the affidavits before the court and the documents contained in the cases referred to in Hearne, saying (footnote omitted): By contrast, the documents, that were at issue in the cases referred to by Hayne, Heydon and Crennan JJ in Hearne, were documents in respect of which the provider of the documents, in a real sense, had no such option whether to make disclosure. Documents that are provided pursuant to an Anton Piller order or subpoena are documents provided in obedience to a court order, non-compliance with which, ordinarily, can be dealt with by way of committal for contempt of court. Rule 24.02 of the Supreme Court (General Civil Procedure) Rules 2015 provides that where a party fails to comply with an order for discovery or inspection of documents or for answers to interrogatories, the Court may order (in the case of a plaintiff) that the proceeding be dismissed, or (in the case of a defendant) that the defendant's defence (if any) be struck out. Importantly, while, in the passage in Hearne, reference was made to affidavits, in the two cases cited by the plurality, those affidavits were made and filed pursuant to a court order.
Without reference to Helicopter Aerial, but in a similar vein, in Silverstein at [88] the difference between witness statements and affidavits was drawn in the following terms (footnote omitted): The category of witness statements ― also referred to by Hayne, Heydon and Crennan JJ in Hearne ― is, at least as a matter of degree, somewhat different. However, in modern litigation, a failure to provide a witness statement as to a particular matter may have significant consequences for the fate of a claim or a defence. In recent years, witness statements have been routinely directed to be provided in most commercial litigation, and in non-common law litigation, in the advance of trial. Such statements are intended to constitute the evidence in chief of the particular witness. If the witness statement is not so provided, the evidence may not, ordinarily, be adduced. In that way, the consequences for the prospects of success of a particular party to the litigation, for non-delivery of such a statement, may be substantial.
Continuing on the theme expressed at [77] that the categories of documents caught by the Harman undertaking are not closed, in Silverstein at [89] it was emphasised that it is not necessary to define with precision the limits of the kinds of documents contemplated by the authorities as having been provided under compulsion for the purposes of applying the Harman undertaking and that it would be undesirable to do so.

[32]

Verde Terra

Verde Terra Pty Ltd v Central Coast Council; Central Coast Council v Verde Terra Pty Ltd (No 7) [2020] NSWLEC 140 is a decision of Pepper J of the Land and Environment Court of New South Wales. Amongst the questions to be determined by her Honour was whether nine affidavits made in earlier 2012 proceedings in the Land and Environment Court were the subject of the implied undertaking and, if they were, whether leave should be granted to the plaintiffs to allow their use in the later 2019 proceedings. Two of the affidavits had been served but not filed by the defendant and all of the affidavits except one had been filed and/or served by the defendant pursuant to ordinary timetabling directions made by the court.
Pepper J at [40] referred to the Harman or implied undertaking as described in Hearne at [95]-[96] and said at [41]: The Harman undertaking is in truth an obligation of substantive law that creates a duty owed to the Court (Hearne at [107]-[108], Papantoniou v Stonewall Hotel Pty Ltd [2018] NSWCA 85 at [24] and Leagou Pty Ltd v Commissioner of Taxation [2020] FCA 1162 at [16]). The reason for the rule is that compulsion by curial process to produce documents involves an invasion of a private right to keep documents to oneself. The public interest in privacy and confidence demands that this compulsion should not be pressed further than the course of justice requires (Hearne at [107]).
At [42]-[45] her Honour set out the relevant principles with respect to the matters which must be considered in determining whether to grant leave to a party to be released from the implied undertaking. I will consider those principles below in relation to my determination of Issue 2 in these proceedings.
The plaintiffs argued that the implied undertaking did not apply to the affidavits as they were not filed under compulsion. At [48] Pepper J stated the uncertainty that has arisen in light of Hearne in the following way: In Hearne the plurality of the High Court appeared to unequivocally state that the principle applied to "affidavits" (at [96] per Hayne, Heydon and Crennan JJ). However, as subsequent authorities reveal, the question of whether affidavits filed in compliance with orders of the Court fixing a timetable for the provision of evidence for trial are disclosed under the relevant degree of coercion, is vexed.
At [49] Pepper J held that the ordinary timetabling directions of the court "were not compulsive". Pepper J at [50]-[54] then recorded the submissions made by the plaintiffs as follows: [50] The Verde Terra parties argued that properly analysed the succinct statement in Hearne had no application to the present case because in Hearne the High Court did not turn its mind to the threshold issue of whether the Harman undertaking properly applied, rather it merely proceeded upon the agreed position of the parties that it did (relying on what was said at [1], [79], [83] and [96]). Accordingly, Hearne holds no binding precedential value in the present applications (citing CSR Ltd v Eddy [2005] HCA 64; (2005) 226 CLR 1 at [13] per Gleeson CJ, Gummow and Heydon JJ). [51] Furthermore, when regard is had to the two cases referred to at footnote 101 in Hearne (at [96]), namely, Medway v Doublock Ltd [1978] 1 WLR 710; [1978] 1 All ER 1261 and Re Addstone Pty Ltd (In liq); Ex parte Macks (1998) 30 ACSR 156, these decisions are distinguishable from the facts of the present case because in each case there was the necessary element of compulsory disclosure. [52] In Medway, the respondent was restrained by a court from using in separate proceedings two affidavits of means sworn by Mr Medway in unrelated proceedings brought against him by his wife in family court litigation. The two affidavits had been filed in the latter proceedings pursuant to court orders requiring him to give full financial disclosure of his financial circumstances. [53] Similarly, in Re Addstone, confidentiality orders had been made in earlier proceedings in respect of certain affidavits filed by a liquidator. Creditors of the company in liquidation filed a motion seeking access to the affidavits. The liquidator agreed to provide the confidential affidavits to them, however, an issue arose as to whether the creditors should only be entitled to use the information contained in the affidavits in their capacity as creditors and not as defendants in any proceedings against them. Mansfield J, who heard the application, considered that it was not necessary to impose such a condition as part of any order made by him that the affidavits be provided because the order to produce the affidavits was "the equivalent of an order for discovery", and therefore, the "normal implied undertaking" not to disclose those documents from a collateral purpose applied (at 160). [54] In the result, the Verde Terra parties submitted that neither case stands as authority for the proposition that the Harman undertaking applies to affidavits filed or served voluntarily in the ordinary course of litigation.
Pepper J at [55]-[56] referred to the extensive analysis to a similar effect conducted by Brereton J in Helicopter Aerial, concluding at [57] that her Honour endorsed and applied that reasoning.
Her Honour then at [59] considered the "same conclusion" which had been reached in Silverstein at [78] that: … not every affidavit filed in compliance with a rule of court is relevantly produced under compulsion attracting the Harman principle…
Her Honour at [60] expressed surprise that the "important question of principle" raised in Helicopter Aerial had not been expressly considered by the Court of Appeal of this court (referring to the remarks of White JA in Gwynvill at [25]-[27]), surmising that it might be because the issue invariably focused on whether the undertaking should be released. At [61] Pepper J then referred to the authorities of the Federal Court of Australia (reviewed in Leagou at [22]-[27]), concerning the question of whether or not affidavits filed in compliance with orders of the court fixing a timetable for the preparation of evidence for a hearing, noting that they had not "definitively resolved the controversy".
Ultimately, at [62] Pepper J decided to adopt the same approach as Helicopter Aerial and Leagou, saying: … given the uncertainty in the existing case law and given that these applications are being determined at first instance, I should err on the side of caution and assume that the Harman principle is applicable and determine whether or not the Verde Terra parties ought be granted release from the undertaking.

[33]

Stokes

Stokes v Toyne [2021] NSWSC 1049 is a decision of Rein J sitting as a single judge of this court. The plaintiff applied for leave to use four affidavits and three experts' reports which had been served by the defendants in the proceedings, but not read or tendered at the hearing, in other proceedings which had been brought by the defendant in the Federal Circuit Court of Australia (as it was then called) and the District Court of New South Wales. The plaintiff contended that the affidavits and experts' reports were not subject to the Harman undertaking but, in the event that the court held that they were, sought to be released nunc pro tunc from that undertaking to the extent necessary to adduce that evidence in the other proceedings.
At [18] Rein J stated that the Harman undertaking is not really an undertaking but rather a substantive obligation "which arises as a result of the circumstances in which documents are generated and received and regardless of the intentions of the parties", referencing Frigger at [19] which in turn cited Hearne at [3], [46], [102] and [105]-[108].
Rein J at [18] then described the joint judgment in Hearne at [96] as being a statement of the "fundamental principle", and at [19] and [20] referenced the statement of the principle by Lord Scarman in Harman (at 312-313) and Lord Roskill in Harman (at 896) quoting Lord Denning MR's explanation of the basis of the principle in Riddick resting in the compulsion to invade "a private right to keep one's documents to oneself" which should not be "pressed further than the course of justice allows".
At [21] Rein J summarised the position as follows: There is no question that documents produced under compulsion cannot be used by the other party without the consent of the producing party or leave of the Court. Although it is expressed as an undertaking to the Court, when consent is clearly given, it appears that the consent of the producing party is sufficient to release the party in receipt of the documents from the obligations owed: see Dagi v Broken Hill Proprietary Co Ltd [1996] 2 VR 567 at 572 per Byrne J; see also Hamersley Iron Pty Ltd v Lovell (1998) 19 WAR 316 at 338 per Anderson J, with whom Pidgeon and Ipp JJ agreed. …
In the next portion of [21], his Honour then moved to consider what amounts to documents being produced "under compulsion", referring to Central Queensland Cement as an authority which holds that witness statements and affidavits required to be filed and served before hearing are regarded as documents produced under compulsion and Helicopter Aerial, Frigger and Verde Terra as authorities for the doubt that has been expressed in the notion that all affidavits filed in the proceedings are subject to the Harman undertaking. The doubts stated and the approach ultimately taken in Helicopter Aerial were specifically quoted by Rein J at [22]-[23].
Rein J at [24]-[25] summarised the conclusions reached in Silverstein that "[t]he cases do not support the conclusion that every affidavit filed in compliance with a rule of court is relevantly produced under compulsion".
At [26] Rein J stated his Honour's approach as follows: The decision in Silverstein, being a unanimous decision of an intermediate court of appeal, is one which I believe I should follow, particularly in light of the views expressed by Brereton J in Helicopter, Jackson J in Frigger and Pepper J in Verde: see Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22; 230 CLR 89 at [135] per Gleeson CJ, Gummow, Callinan, Heydon and Crennan JJ I recognise that there may well be a question about the extent to which a party who has received affidavits from his or her opponent is able to utilise those affidavits for extraneous purposes, but I proceed on the basis that use of affidavits obtained in one set of proceedings can, without any requirement of leave, be utilised in other proceedings involving the same parties. It follows that Mr Stokes was not required to seek the consent of Ms Toyne to use the material and was not in breach of the Harman Undertaking in using the material.
In case Rein J was wrong about this conclusion, his Honour then proceeded to consider whether the implied undertaking should be released.

[34]

Woods

In the matter of T & F.S. Woods Pty Ltd v Woods [2021] FCA 1220 is a decision of Derrington J of the Federal Court of Australia which determined an application by the plaintiff, Mr Woods, to use affidavits which had been filed and served by the first plaintiff in those proceedings for the purposes of other proceedings brought in the Federal Circuit and Family Court of Australia. The proceedings in the Federal Court of Australia were brought by Mr Woods on behalf of the second plaintiff company, T & F.S Woods Pty Ltd.
In the Federal Court proceedings, Mr Woods sought leave retrospectively to bring and conduct those proceedings on behalf of T & F.S Woods Pty Ltd. Mr Woods filed two affidavits in support of his application pursuant to a court rule that the originating process must be supported by an affidavit stating the facts in support. Mr Woods also filed a third affidavit but it was not clear why it had been filed. Before any substantive step was taken in the Federal Court proceedings, Mr Woods discontinued them with the consent of the defendant.
At [11]-[16] Derrington J set out a summary of the decisions in each of Harman and Hearne and then analysed the reliance in Sinnott on what was described as an underlying principle in Central Queensland Cement ("a document furnished for use for one purpose may not legitimately be used for another"), about which Derrington J said at [16]: That principle, if it ever represented good law in Australia, would extend the implied undertaking beyond the circumstances considered in Sinnott to circumstances where no element of compulsion existed. Indeed, if an affidavit had been voluntarily furnished in one proceeding, that principle would make it impermissible for another party to rely upon it in other proceedings without the leave of the court. However, the correctness of that statement of principle has subsequently been doubted, at the very least because it pre-dates and is directly inconsistent with the authoritative statement of principle in Hearne v Street: see Frigger v Trenfield (No 5) [2020] FCA 827 [46].
This is a noteworthy observation, particularly in light of the fact that the joint judgment in Hearne at [96] specifically referenced Central Queensland Cement to support the application of the implied undertaking to witness statements served pursuant to a judicial direction.
Derrington J at [17]-[20] considered Silverstein in detail, arriving at the following conclusions at [21]-[22]: [21] This Court is bound to follow the conclusions reached by the Court of Appeal in Silverstein: Farah Constructions Pty Ltd v Say‐Dee Pty Ltd (2007) 230 CLR 89 at 151-152 [135]: with the consequence that it must be concluded that the affidavits filed in these proceedings are not the subject of any implied undertaking and that the second plaintiff does not require leave to rely upon them in the FCFCOA Proceedings. Nevertheless, it ought to be observed that, on one view, the Court of Appeal's decision appeared to emphasise the issue of whether the relevant originating or interlocutory application was made voluntarily, rather than on whether a party was compelled to file, serve or produce the specific documents or information in the relevant affidavit: see at [85]-[86]. The difficulty with the former approach is that it might be taken to follow that no documents or information which a party produces in the course of the proceedings (or in respect of an interlocutory application) which it brought voluntarily can be the subject of the implied undertaking, regardless of whether it was produced under compulsion of a rule or order of the court. Plainly, that would be wrong in the case of documents or information disclosed pursuant to an order requiring an applicant to produce specific documents or information, or specific categories of documents or information in proceedings it commenced voluntarily. Indeed, the quintessential case of compulsion is the production of documents as part of the process of disclosure or discovery. [22] Likewise, where a party is required by the rules of court or an order of the court to file and serve an affidavit deposing to specific information or categories of information, such an affidavit is in substance disclosure and would also be the subject of the implied undertaking. That may be contrasted with affidavits which are voluntarily made in support of an originating or interlocutory process. Even if the relevant rule of court requires such affidavits to be filed with or in support of the process, the specific information or documents included in the affidavits is not prescribed. The documents disclosed or information evidenced is a matter of the litigant's choice. The position seems to be the same where, as here, the rules of court requires the affidavit to state "the facts in support of the process". The information and documents included in the affidavits is nevertheless produced "voluntarily". The same is broadly true of affidavits filed in response to the relevant process.
Derrington J further concluded at [23] that: … timetabling orders which require a party to file and serve any affidavits on which it intends to rely by a particular date, in general, do not compel the disclosure of the specific information or documents included in affidavits filed and served in compliance with such orders: Leagou Pty Limited v Commissioner of Taxation [2020] FCA 1162 [19] - [24]. In Helicopter Aerial Surveys Pty Ltd v Robertson [2015] NSWSC 2104, Brereton J doubted whether such orders constituted sufficient compulsion to attract the implied undertaking, but considered himself bound by Hearne v Street to conclude that it did: at [39]-[40].
Derrington J cited Leagou as support for his Honour's conclusion, yet White J in Leagou expressly did not decide that issue but proceeded on the assumption that affidavits required pursuant to timetabling orders were compelled and therefore subject to the implied undertaking.

[35]

Johnston

Johnston v Allen [2024] NSWSC 187 is a decision of Parker J as a single judge of this court. It involved earlier proceedings in which an affidavit of the defendant's solicitor had been filed and served on behalf of the defendant. The affidavit was headed "confidential" and filed without any order of the court. Subsequently, an order was made that the affidavit be made available to all parties in the proceedings. The affidavit was then sent to the other parties. The proceedings then settled. The plaintiff applied to be released from the implied obligation so that the affidavit could be used in complaint proceedings against the defendant's solicitor. The defendant's solicitor applied to restrain the use of the affidavit.
At [80] Parker J said: The paradigm case for the application of the Harman doctrine is when documents are produced to a court by means of discovery or other compulsory process. ...
Parker J at [81] described the circumstances in which the affidavit came to be provided, saying: But the Webster Affidavit, although described as confidential, was not given to the Court pursuant to a compulsory process such as a subpoena or discovery. Rather, it was prepared and filed with the Court by Mr Webster without any prior order being made. It is true that a formal order was later made for its provision to the parties, but, on the face of it, the plaintiffs' legal representatives would have been entitled to access the Affidavit through the Court's electronic filing system independently of any order of the Court. A further complication is that Mr Webster purported to file the Affidavit on behalf of Mrs Johnston, when, on the face of it, he had no authority to do so. Nevertheless, in the course of the hearing before me, all of the recipient parties' counsel accepted that the Affidavit was subject to an obligation of confidentiality.
His Honour then proceeded to deal with the question of whether leave to release the implied obligation should be given. There was no debate about whether or not the implied obligation applied to the affidavit. It was not an issue put in contest in Johnston. Parker J decided to release the implied obligation.

[36]

Plaintiffs' submissions

The plaintiffs' primary submission is that the implied obligation does not apply to each of the Relevant Affidavits because they were not served under compulsion as they were voluntarily filed and served on 8 October 2021 on behalf of Keith and Gregory pursuant to ordinary timetabling orders for the filing and service of evidence in the Probate Proceedings and the Equity Proceedings.
In support of this argument, the plaintiffs cited the statement of principle in Hearne at [96] which requires that the party be compelled to disclose the documents or information. The plaintiffs say that the description of being "compelled" readily applies to affidavits which a party is obliged to serve, such as in response to an order in support of a freezing order that a party disclose their assets, but does not readily apply to affidavits which are voluntarily served in the usual course of litigation. According to the plaintiffs, for an order that a party provide an affidavit pursuant to timetabling orders there is no requirement that the party in fact provide an affidavit let alone an affidavit in the terms ultimately served.
The plaintiffs submitted that this is consistent with the authorities which are referred to in Hearne as well as the expressed rationale for the obligation. In short, while Hearne lists "affidavits" in the second sentence of [96] as an example of the type of material to which the principle applies, this should not be understood as meaning that any affidavit served attracts the obligation but that the principle can apply to affidavits if they are disclosed by compulsion.
The plaintiffs referred to the decisions in Medway and Addstone which are referenced in Hearne at [96] to support this interpretation of the principle, with Medway involving an express order that the husband disclose his assets in the family law proceedings and Addstone concerning a direction for an affidavit akin to discovery.
The plaintiffs also placed reliance on the rationale for the obligation expressed in Hearne at [107] to ensure that a person experiencing a very serious invasion of privacy and confidentiality does not have placed upon them any burden which is harsh or more oppressive than is strictly required for the purpose of securing that justice is done. The plaintiffs asserted that this rationale does not apply in relation to a person who voluntarily chooses to provide an affidavit in support of litigation.
The plaintiffs specifically relied on the decision in Silverstein and its analysis that the affidavits in that case were not filed and served by compulsion and that the authorities do not support the proposition that every affidavit filed in compliance with the rule of court is produced under compulsion. The plaintiffs also observed that Silverstein cast doubt on the conclusion in Sinnott that an affidavit filed in support of an extension of time application and the substantive claim is subject to the implied obligation. The plaintiffs also relied on the observation in Silverstein that the party was not compelled to make applications for summary judgment or preliminary discovery and therefore the affidavits filed in support of those applications could not be considered to have been compelled.
The plaintiffs also relied on the decisions in Helicopter Aerial, Woods and Stokes which all concluded that affidavits filed pursuant to timetabling orders in the ordinary course of litigation are not to be regarded as having been compelled and are therefore not subject to the implied obligation (although in the case of Helicopter Aerial, Brereton J proceeded on the basis that the implied obligation did apply to the affidavit in question).

[37]

Defendants' submissions

The defendants submitted that Hearne is binding High Court authority. They say that even though it was not in contest in Hearne that the affidavit and expert report served pursuant to timetabling orders were subject to the implied obligation, the High Court did not say that the concession was wrongly made. The defendants asserted that in the context of a contempt charge it might reasonably be expected that the High Court would have said so in Hearne.
The defendants said that each of the cases relied upon for the statement of principle by the joint judgment in Hearne at [96] supports the proposition of witness statements and affidavits being protected by the implied obligation. According to the defendants, the following conclusions arise from each of those cases covering a wide range of scenarios, which are inconsistent with the plaintiffs' primary submission that voluntarily served affidavits do not attract the implied obligation: 1. Bourns: held that voluntary production of documents in support of a costs taxation was subject to the implied obligation. 2. Central Queensland Cement: held that witness statements served pursuant to timetabling orders are protected by the implied obligation. 3. Springfield Nominees: held that a witness statement filed pursuant to a timetabling order was protected by the implied obligation and ought to be treated in the same way as affidavits, following Central Queensland Cement. 4. Smoothdale: held that expert witness reports served in accordance with timetabling orders were protected by the implied obligation, following Springfield Nominees. 5. Medway: held that an affidavit served in family law proceedings could be protected by the implied undertaking. 6. Addstone: held that the disclosure of an affidavit provided on a confidential basis should take place on the same basis as discovery and the implied obligation applied.
The defendants also submitted that the terminology in Hearne at [96] of "witness statements served pursuant to a judicial direction" and "affidavits" could only mean one thing which is that an affidavit, whether or not served pursuant to a direction of a court, is protected by the implied undertaking. It was said by the defendants that this statement in Hearne means that witness statements served pursuant to judicial direction and affidavits are to be regarded as one and the same, so that the authorities which support the implied obligation protecting witness statements equally support the implied obligation protecting affidavits. In the alternative, the defendants submitted that if only witness statements that are produced "pursuant to a judicial direction" are protected by the implied obligation, then, by the absence of those words in Hearne at [96] with respect to affidavits, affidavits have a greater protection than witness statements.
The defendants stated that there is no authority in this court which has declined to follow Hearne in respect of affidavits. The defendants reasoned that the comment made in Stokes by Rein J expressing doubt that affidavits filed and served in the ordinary course of litigation attracted the implied obligation should be considered strictly obiter given that in Stokes it was held that the implied obligation ought to be released in any event. The defendants also submitted that while Brereton J in Helicopter Aerials also expressed doubt that the implied obligation applied to voluntarily produced affidavits, Brereton J rightly considered that he was bound to apply Hearne and did so. The defendants also referred to the decision of Parker J in Johnston as an example of the implied obligation applying to a voluntarily produced affidavit, in circumstances where use of the affidavit was in breach of the obligation. The defendants said that while there was agreement between the parties that the implied obligation applied, if Parker J thought that agreement was wrong in law, it might reasonably be expected that he would have said so.
It was put by the defendants that there is no substantive difference in modern practice between witness statements and affidavits and therefore the implied obligation applies to them in equal measure. It was said that they both: 1. are directed to the same goal: to have reduced to writing the evidence that a witness proposes to give; and 2. have the same substantive attributes: until an affidavit is read, the written affidavit is not evidence and, until a witness statement is the subject of oral evidence in chief, the written statement is also not evidence.
The defendants submitted that other cases relied on by the plaintiffs, such as Woods and Silverstein, are interstate cases which unlike Hearne itself and the weight of authority in New South Wales, this court is not bound to follow and, in any event, Sinnott is against the plaintiffs' argument.
The defendants said that in any event the interstate cases relied on by the plaintiffs should not be followed, particularly Silverstein which reasons that affidavits voluntarily produced as a matter of choice are not protected by the implied obligation because the plaintiffs providing such affidavits can simply choose not to pursue those claims. According to the defendants: 1. This reasoning is incongruous and highly problematic when applied to a defendant/respondent to an application because the defendant/ respondent, unlike a plaintiff/applicant, has no choice in whether or not to participate in litigation. The proposition that affidavits provided by defendants do not have the protection of the implied obligation should be rejected. 2. If only plaintiffs/applicants are deprived of the protection of the implied obligation in accordance with the reasoning in Silverstein, the undertaking would become a one-sided principle inconsistent with its general underpinning as explained in Hearne.
The defendants argued that the Relevant Affidavits were served by the defendants in their capacity as executors in support of an application for probate and an equitable claim benefiting the Estate, which they were duty and legally bound to pursue, including in discharge of their fiduciary duties owed as executors and trustees. It was submitted that they could not, without abandoning their assigned role as executors, withdraw their application for probate. The defendants argued that the Relevant Affidavits were not then voluntary in the relevant sense, as they were not, by analogy, in Bourns.
The defendants also submitted that the Relevant Affidavits are the subject of the implied obligation because the plaintiffs were not involved in the Probate Proceedings in any capacity and are strangers to that litigation, a matter which was the subject of comment in Stokes at [26].

[39]

Consideration

In my opinion, this case can be decided by the application of the principle expressed in Hearne at [96], using the approach explained in Hasler that the primary guide to understanding the principle as stated by the High Court is the language of that court's reasons. To restate, [96] in Hearne relevantly says (footnotes omitted and emphasis added): 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.
I need to determine whether or not each of the Relevant Affidavits was compelled to be disclosed by Keith and Gregory in the Probate Proceedings and the Equity Proceedings by reason of a rule of the court, a specific order of the court or otherwise. If they were not so compelled, then the disclosure of the Relevant Affidavits to Marie and her solicitor (Mr Lacey) in the Probate Proceedings and the Equity Proceedings was not subject to the implied obligation and they are able to be disclosed in turn to the plaintiffs in these proceedings and used by them for the purposes of these proceedings.
The need to find "compulsion" as stated in the principle in the first sentence of [96] in Hearne necessarily conditions the "types of material to which this principle applies" as catalogued in the second sentence of [96]. The ordinary meaning of the language used in [96] does not allow for it to be interpreted in any other way. To come within the principle, the disclosure of the documents or information must have been compelled. It is not enough to simply conclude that a document disclosed is an affidavit because to do so is to ignore the requirement that the disclosure has been compelled.
I am fortified in this conclusion by the rationale for the protection of the implied obligation expressed by the joint judgment in Hearne at [107], leaning on the words used in Riddick and Harman, which is that because the disclosure by compulsion involves a very serious invasion of privacy and confidentiality, the disclosure should be on the terms of the implied obligation so that it is no more than is strictly necessary to secure justice. The protection that exists for the disclosing party lies in an action for contempt against any party who breaches the implied obligation. The seriousness of that possible consequence impacts on the manner in which the principle is articulated.
This means that the defendants' argument that every affidavit filed and served in the course of proceedings in accordance with normal timetabling directions is the subject of the implied obligation must be rejected. Reading the expression of principle in Hearne as having that outcome gives too much importance to the mention of "affidavits" in the second sentence of [96] of Hearne over the need to find the compulsion in the expression of the principle in the first sentence of [96]. It would render "compelled" in the first sentence bereft of any meaning. It would also have the very real consequence of subjecting the recipients of affidavits in court proceedings to the constant prospect of alleged contempt against them. This cannot have been intended by Hearne.
Further, as I stated above, in Hearne it was not in contest that the disclosure of the expert report and affidavit provided in accordance with normal timetabling orders were subject to the implied obligation, a matter which was assumed by the High Court. Applying the principle stated in Coleman and CSR means that I am not bound by the High Court's assumption in my application of the principle in Hearne. I reject the defendants' argument to the contrary. In this case, I need to find the compulsion for myself.
I have taken into account the analysis of the principle in Hearne and its application in each of Helicopter Aerial, Sinnott, Frigger, Leagou, Silverstein, Verde Terra, Stokes, Woods and Johnston, all of which I have summarised above. In particular, while Silverstein is a decision of an intermediate appellate court, I do not consider that I am bound by it on the application of the principle in Hearne, but I may use it as a guide to my understanding and interpretation of the High Court's reasons in Hearne. In my opinion, Silverstein did not depart from the principle stated in Hearne but applied it.
In my view, none of the references which are footnoted in [96] of Hearne support the defendants' arguments. As mentioned in Helicopter Aerial, Frigger, Leagou, Silverstein, Verde Terra, Stokes and Woods, those references do not underpin a finding that any disclosure of an affidavit in proceedings to another party is subject to the implied obligation.
The principle on which the interlocutory judgment in Central Queensland Cement was decided in relation to a witness statement - a document furnished for one purpose may not legitimately be used for another - is not the principle stated in Hearne and is considerably wider. I do not consider that the footnote reference to Central Queensland Cement in Hearne is an endorsement of a different principle. I share the misgivings about that different principle voiced in Frigger at [62]. As stated in Woods at [16], I think that the application of the wider principle from Central Queensland Cement in Sinnott was misplaced.
Springfield Nominees applied the principle in Central Queensland Cement in circumstances where the parties did not put in contest whether the implied obligation applied to a witness statement. Further, Springfield Nominees placed importance on the question of whether a court rule prevented access to the court file, a factor which also does not find its expression in Hearne. I do not consider that the footnote reference to Springfield Nominees in Hearne is an endorsement of some other consideration.
Accordingly, I will apply the principle as stated in Hearne. I will not apply the wider principle from either Central Queensland Cement or Springfield Nominees for establishing whether there is an implied obligation in this case.
I also agree with the observations made in Helicopter Aerial and Silverstein regarding the decisions in Smoothdale, Medway and Addstone which were referenced in Hearne. In summary, these are: 1. Smoothdale: involved the application of the principle in Springfield Nominees to witness statements without any contest over whether the witness statements were subject to the implied obligation. 2. Medway: involved the compulsory provision of an affidavit of financial means pursuant to a court order. 3. Addstone: involved the provision of an affidavit pursuant to a court order regarded as equivalent to an order for discovery.
I concur with Brereton J's observations in Helicopter Aerial at [37] about the crucial difference between a witness statement served pursuant to a judicial direction and an affidavit, which turns on the fact that the witness statement is merely advance notice of the evidence the witness is expected to give and remains confidential unless and until it is deployed, at which time it will become evidence. In contrast, an affidavit is sworn or affirmed as the truth and is the evidence of the witness. Absent a court order or an agreement between the parties, an affidavit is not confidential. It is this difference which explains the separation of those two types of documents in the second sentence of [96] in Hearne. For this reason, I do not accept the defendants' argument that there is no substantive difference between them.
As I have said, the crucial question that I discern from the principle in Hearne is whether the documents or information were compelled to be disclosed. There are countless ways in which documents or information are provided in legal proceedings. In some circumstances it will be obvious that a disclosure has been compelled by a rule of court, order of the court or otherwise, as stated in Hearne. In other cases, it will not be.
The defendants argue that the Relevant Affidavits cannot be regarded as voluntary because they were served in their capacity as executors in support of an application for probate and an equitable claim that would benefit the estate, which they were duty and legally bound to pursue. They rely on the decision in Bourns, referenced in Hearne, by analogy. But Bourns does not support the defendants' argument in my view, particularly when consideration is had to the Bourns appeal, which was also referenced in Hearne.
Bourns and the Bourns appeal both concern the question of whether a party is under a duty to disclose documents in a taxation, which is a court process. The finding in Bourns was that there was a compulsory disclosure of private documents for the purposes of the taxation. In other words, the duty arose from the court process which provided the circumstances in which the documents were disclosed, not some wider duty such a fiduciary duty, an executor's duty or a duty arising from some other source.
I do not think that the question of compulsion in the principle expressed in Hearne is answered simply by considering whether a party is duty or legally bound to undertake a particular step by virtue of some responsibility, position or office that they hold. Otherwise the principle will default into an investigation of why the proceedings were brought or defended, which is no part of the principle expressed in Hearne. In my view, the compulsion expressed in Hearne must arise from the court process in the legal proceedings themselves or, to put it another way as stated in Frigger at [64], "an intrusion by the court into the rights of a party not to disclose private documents which is essential to the obligation".
I consider that in the context of an affidavit made in court proceedings, "compelled" must have its natural meaning of being forced or required to undertake the course of action, being disclosure of the affidavit, in a manner which involves an invasion of the privacy and confidentiality of the contents of that affidavit. It is to be contrasted with a voluntary disclosure of the affidavit. It is not germane to that inquiry whether a party is vindicating rights or defending them. The imposition of the implied obligation in legal proceedings does not arise from the designation of a party as either a plaintiff or a defendant but turns on the circumstances in which the disclosure has been made.
A party who is required by an ordinary timetabling order of the court to provide any affidavits on which they intend to rely at the hearing is not compelled to provide them. The party in those circumstances has a choice whether to provide a particular affidavit and what the contents of that affidavit should be. Doing so is not a "very serious invasion of privacy and confidentiality" of the party's affairs in the sense described in Riddick and Harman, as applied by Hearne, as the rationale for the implied obligation.
I agree with the observations made in Woods at [21]-[22] that the focus of the inquiry in Hearne is on whether the specific documents or information were compelled to be disclosed, not on whether the application to which they relate was compelled. In that regard and with respect, I depart from what was said in Silverstein at [85], [86] and [90] which focussed on whether there was any compulsion to bring the applications to which the affidavits related. In my view, that is not the relevant inquiry.
In my opinion, it is clear that: 1. the Relevant Affidavits were each provided voluntarily in accordance with the ordinary timetabling orders of the court made on 14 September 2021 for the filing and serving of evidence in the Probate Proceedings and the Equity Proceedings; 2. the Relevant Affidavits were not compelled by the court to be provided in those proceedings; and 3. the possession of the Relevant Affidavits by Marie and Mr Lacey as her solicitor in the Probate Proceedings and the Equity Proceedings is therefore not subject to the implied obligation.
It follows that the plaintiffs are also not subject to the implied obligation with respect to the Relevant Affidavits, nor is Mr Lacey as their solicitor in these proceedings.

[41]

Legal principles

The parties were in agreement as to the legal principles I should apply in deciding whether to grant leave to release a party from the implied obligation.
Those principles derive from what was said in Crest Homes Plc v Marks [1987] AC 829, by Lord Oliver at 860: … the court will not release or modify the implied undertaking given on discovery save in special circumstances and where the release or modification will not occasion injustice to the person giving discovery. …
The notion of "special circumstances" in this test was then considered by Burchett J in Holpitt Pty Ltd v Varimu Pty Ltd (1991) 29 FCR 576; [1991] FCA 354, who said at 578-579: … As far as the expression "special circumstances" is concerned, it is an expression which is liable to be misunderstood unless care is taken to ask and answer the question, special in relation to what? "Special" is one of those words which derive almost all their meaning from the context. … If all that is required is that, among the great number of cases in the court in which documents have been discovered, this one must evince some special feature which affords a reason for releasing or modifying the undertaking, there will be no difficulty. Circumstances in which there is a legitimate reason why documents discovered in one proceedings should be made available in another will, viewed in this way, be rare. In the ordinary course, the ordinary rule should apply, there being no special circumstance to suggest otherwise. Cf Jess v Scott (1986) 12 FCR 187, where the Full Court was concerned with the construction of O 52, r 15 (2), by which leave to file an appeal out of time could be granted "for special reasons". The joint judgement described (at 195) the expression "special reasons" in this rule as: "an expression describing a flexible discretionary power, but one requiring a case to be made upon grounds sufficient to justify a departure, in the particular circumstances, from the ordinary rule prescribing a period with which an appeal must be filed and served." Of course, if Lord Oliver should be taken to have required the circumstances to be special, not in relation to all the various circumstances of the action in which the relevant implied obligation has arisen, but in relation to the very small number of cases in which a reason appears why the undertaking might be relaxed, the discretion of the court would be entangled in a rule of quite uncertain import. I do not know on what footing one would say that a particular circumstance amongst these relatively rare circumstances would be "special" and another not. I do not think his Lordship intended to fetter the court's discretion in this way. I think he was using the words "special circumstances" to express the same idea which is expressed in the rule discussed in Jess v Scott (supra) by the words "for special reasons"…
Having analysed what was said in Crest Homes and Holpitt, the principles applied by the court in deciding whether to release the implied undertaking were then classically stated by Wilcox J in Springfield Nominees at 225 as follows: … For "special circumstances" to exist it is enough that there is a special feature of the case which affords a reason for modifying or releasing the undertaking and is not usually present. The matter then becomes one of the proper exercise of the Court's discretion, many factors being relevant. It is neither possible nor desirable to propound an exhaustive list of those factors. But plainly they include the nature of the document, the circumstances under which it came into existence, the attitude of the author of the document and any prejudice the author may sustain, whether the document pre-existed litigation or was created for that purpose and therefore expected to enter the public domain, the nature of the information in the document (in particular whether it contains personal data or commercially sensitive information), the circumstances in which the document came into the hands of the applicant for leave and, perhaps most important of all, the likely contribution of the document to achieving justice in the second proceeding.
This expression has been repeatedly approved and applied by courts dealing with the question since, specifically by the Full Court of the Federal Court in Liberty Funding, Branson, Sundberg and Allsop JJ saying at [31]: In order to be released from the implied undertaking it has been said that a party in the position of the appellants must show "special circumstances": see, for example, Springfield Nominees Pty Ltd v Bridgelands Securities Ltd (1992) 38 FCR 217; 110 ALR 685. It is unnecessary to examine the authorities in this area in any detail. The parties were not in disagreement as to the legal principles. The notion of "special circumstances" does not require that some extraordinary factors must bear on the question before the discretion will be exercised. It is sufficient to say that, in all the circumstances, good reason must be shown why, contrary to the usual position, documents produced or information obtained in one piece of litigation should be used for the advantage of a party in another piece of litigation or for other non-litigious purposes. The discretion is a broad one and all the circumstances of the case must be examined. In Springfield Nominees, Wilcox J identified a number of considerations which may, depending upon the circumstances, be relevant to the exercise of the discretion. These were: • the nature of the document; • the circumstances under which the document came into existence; • the attitude of the author of the document and any prejudice the author may sustain; • whether the document pre-existed litigation or was created for that purpose and therefore expected to enter the public domain; • the nature of the information in the document (in particular whether it contains personal data or commercially sensitive information); • the circumstances in which the document came in to the hands of the applicant; and • most importantly of all, the likely contribution of the document to achieving justice in the other proceeding.

[42]

Plaintiffs' submissions

The plaintiffs submitted that "special circumstances" exist in the present case to support a finding that leave to should be granted to enable the plaintiffs to use the Relevant Affidavits in the present proceedings. They relied on the following factors: 1. The Relevant Affidavits were voluntarily produced with the obvious intention of being read in open court, circumstances said in Helicopter Aerial by Brereton J at [42] to be "highly relevant" to an application for leave to use documents subject to the implied obligation. 2. It is not apparent that the Relevant Affidavits contain personal data or commercially sensitive information. It is not suggested by the defendants that any particular harm will befall them if the Relevant Affidavits are used as intended by the plaintiffs. The Wilton affidavit and the Blais affidavit set out their dealings with Denis and include information about the financial affairs of Denis but in circumstances where Denis is now deceased, it is not apparent that this information has any ongoing sensitivity. The Brent affidavit sets out details about the business affairs of Denis but it only states the structure of those businesses and the business ventures which Denis discussed with Mr Brent. The Brent affidavit does not provide detailed information about the business affairs of Denis. There is no suggestion that anything stated in the Relevant Affidavits is inaccurate or wrong. 3. The Relevant Affidavits became available through their voluntary disclosure by Gregory and Keith to Marie, who has given her consent for them to be given to the plaintiffs. There is no impropriety on the part of the plaintiffs which would justify withholding leave. 4. Mr Brent, the deponent of the Brent affidavit, has been served with a letter setting out the plaintiffs' position with respect to the Brent affidavit as well as a copy of the plaintiffs' application for leave. Mr Brent has indicated to the defendants' solicitors that he does not intend to obtain his own legal representation but objects to the use of the Brent affidavit, without articulating any basis for his objection. 5. Each of the Relevant Affidavits contain material which is relevant to the present proceedings. The dispute in the present proceedings turns on alleged oral representations regarding the plaintiffs' interest in the East Maitland Property pursuant to an option agreement alleged to have been made orally and in writing at various times. The defendants either do not admit or deny these oral representations. The plaintiffs should be permitted to compare the defendants' evidence in the present proceedings with the contents of the Relevant Affidavits and conduct a cross-examination on particular topics by reference to it, including any inconsistencies or silence as to the oral representations. Importantly, the Relevant Affidavits each contain material that is consistent with the plaintiffs' case: 1. The contents of the Blais affidavit are consistent with Gregory having discussions with the plaintiffs concerning the East Maitland Property, consistent with the project for the development of the East Maitland Property continuing into 2020 (after the date on which the option was to expire), the conferral of authority by Denis upon Gregory to deal with the East Maitland Property and the development of it, and contain a more detailed version of a conversation which is referred to in the Earlier Blais affidavit which was read in open court in the Probate Proceedings. 2. The contents of the Wilton affidavit are consistent with Keith having knowledge of the redevelopment of the East Maitland Property and the location of the documents relating to it. 3. The contents of the Brent affidavit are consistent with there being discussions until 2020 concerning the sale of the East Maitland Property. 1. Mr Lacey has received and read the Relevant Affidavits and has knowledge of the information contained in them because he acted for Marie in the Probate Proceedings and the Equity Proceedings. When the defendants file their affidavits in these proceedings, Mr Lacey will have to assess for himself the extent to which there is complete consistency or not between those affidavits and the Relevant Affidavits. He is in an invidious and unusual position because he already has the knowledge of the contents of the Relevant Affidavits and cannot put them out of his mind while acting for the plaintiffs in these proceedings.

[43]

Defendants' submissions

The defendants contest that there are any "special circumstances" which would justify a grant of leave in favour of the plaintiffs' use of the Relevant Affidavits.
The defendants said that the Wilton affidavit and the Blais affidavit were not voluntarily produced. They submitted that they were duty and legally bound to pursue the application for probate in the Probate Proceedings and the equitable claim benefitting the Estate against Marie in the Equity Proceedings.
The defendants submitted that it is a neutral factor that the Relevant Affidavits were served with a view to use in the final hearing, as the implied obligation attaches to affidavits before they are read or documents tendered.
The defendants also contended that the implied obligation should not be released as the Relevant Affidavits traverse highly sensitive information to the family of Denis, including Denis' financial interests, health issues, family conflict and dying wishes. They say that none of the sensitivity of this information has disappeared with the death of Denis and the executors and beneficiaries of the Estate have a strong interest in not having to relive this unfortunate and sad chapter of their lives.
The defendants argued that Marie has no authority to give consent to the plaintiffs to use the Relevant Affidavits because she is bound by the implied obligation and, in any event, her consent is immaterial as the defendants can publish their affidavits without her approval because it is their own information.
The defendants said that there is a risk, if the Relevant Affidavits are made public, they could potentially be used on social media in a defamatory manner.
The defendants referred to the fact that Keith, Gregory and Mr Brent (who is a non-party) do not consent to the use of their respective Relevant Affidavits in these proceedings. The defendants highlighted that: 1. It is not clear how the Relevant Affidavits are relevant to these proceedings. 2. The Relevant Affidavits were prepared for the specific purpose of, and contain only content directed to, the issues in the Probate Proceedings; 3. The Probate Proceedings were hard fought and upsetting, and settled to preserve confidentiality, bring closure and avoid a public hearing. Using the Relevant Affidavits in these proceedings would be distressing to the defendants. The privacy considerations which underpin the implied obligation generally have considerable force. 4. None of the plaintiffs were parties to the Probate Proceedings and only have knowledge about the existence of the Relevant Affidavits because their solicitors happened to have acted for Marie in them.
The defendants submitted that any relevance of the Relevant Affidavits to the present proceedings is unclear or limited, as: 1. The material contained in the Relevant Affidavits does not relate to whether there were oral variations of the option agreement. 2. There is no dispute that there was a commercial arrangement between Denis and HG InvestCorp which was discussed at various times. The Relevant Affidavits are consistent with the existence of this arrangement and the discussions, which takes the issue no further. The Relevant Affidavits do not support any of the pleaded material allegations contained in the statement of claim in these proceedings, such as the oral extension of the Call Option Deed. 3. The issue about the conferral of authority by Denis upon Gregory to deal with the East Maitland Property and the development of it is contained in the Earlier Blais affidavit which is not the subject of an implied obligation, so it is unnecessary for the plaintiffs to use the Blais affidavit to make that point. 4. The alleged relevant part of the Wilton affidavit does not refer in any way to the sale of the East Maitland Property which is the subject of these proceedings. 5. The Brent affidavit has the most general reference to there being discussions about a number of topics over a decade. 6. The defendants in these proceedings have not yet put on any evidence, so is not possible to assess, at this premature stage, whether the Relevant Affidavits might be relevant in the sense contemplated by s 43 of the Evidence Act 1995 (NSW) concerning prior inconsistent statements.
The defendants accepted that Mr Lacey is in a difficult position as the solicitor for the plaintiffs who has knowledge of the contents of the Relevant Affidavits, but asserted that this it is not a reason to grant leave to release the implied obligation because it is the position in which Mr Lacey has put himself.

[44]

Plaintiffs' submissions in reply

The plaintiffs submitted that it is obvious from the contents of the Relevant Affidavits that they have nothing to do with the application for probate but are all about the dispute between Keith and Gregory as executors and Marie. The plaintiffs said that the attempt by the defendants to justify compulsion on the basis that the Relevant Affidavits were required to obtain probate and probate was something they were duty bound to obtain is not supported.
The plaintiffs pointed out that the defendants made no submission dealing with the threshold issue of whether an affidavit served in these proceedings is or is not consistent with what is set out in the Relevant Affidavits. The plaintiffs argued that the only way in which that exercise can be performed is by taking the Relevant Affidavits and comparing them to what might be served and this comparison can only be undertaken if leave to use the Relevant Affidavits is granted. It is this use for which leave is sought.
The plaintiffs contested the notion that the application for leave is premature. They submitted that the defendants' suggestion seemed to be that the plaintiffs should wait and see what they serve as evidence in these proceedings, but doing so would not solve the existing problem because the threshold issue that will immediately arise as soon as anything is served is - to what extent is it consistent or not? The plaintiffs said that is a legitimate circumstance which would warrant a release from the implied obligation, citing Helicopter Aerial at [48] where Brereton J said although it was not possible to say at that stage of the proceedings whether any of the documents would be highly important to the defence in that case, "they touch on some aspects of it and deal with some matters relevant to them, and at least have the potential to assist in the preparation of his defence". According to the plaintiffs I should be satisfied that there ought to be a release of the implied obligation because there is the potential for the Relevant Affidavits to assist at a subsequent stage in the proceedings.
The plaintiffs dealt with the asserted sensitivity of the material in the Relevant Affidavits by submitting that any use of the Relevant Affidavits would only be in these proceedings and not for any other purpose. The plaintiffs acknowledged that they could not use the contents otherwise.
The plaintiffs submitted that the Relevant Affidavits have the potential to be quite important if the defendants' evidence in these proceedings does not describe any of the conversations in detail, as inferences may be drawn based upon statements in the Relevant Affidavits. Using the example of the Brent affidavit, the plaintiffs said that Mr Brent has admitted that during the decade to 2020 (a critical period in the plaintiffs' case), he was discussing various matters with Denis that included the options. The plaintiffs submitted that if Mr Brent does not say anything about what was said in those discussions or denied them in an affidavit in these proceedings, then it may well be that inferences can be drawn about that fact.

[52]

Most importantly of all, the likely contribution of the document to achieving justice in the other proceeding

In my view, if the implied obligation existed in relation to the Relevant Affidavits, unless leave was granted the plaintiffs would not be permitted to use the Relevant Affidavits in any way, even for the purposes of conducting a comparison of their contents with any affidavits which are filed and served by the defendants in these proceedings. I am satisfied that the contents of the Relevant Affidavits may have some relevance to the events which are in issue in these proceedings, particularly: 1. the issue of whether Gregory was authorised to make decisions with respect to the East Maitland Property, which the defendants deny; and 2. the issue of whether from around 21 December 2019 Gregory was Denis' agent with respect to the sale of the East Maitland Property, which the defendants do not admit.
Further, because the plaintiffs' case in these proceedings significantly depends on allegations of oral representations, the contents of the Relevant Affidavits may become relevant to the consistency of evidence about those conversations in subsequent affidavits made by the defendants in these proceedings.
In my view, to paraphrase what was said in Helicopter Aerial at [48], I am satisfied that the contents of the Relevant Affidavits touch on some aspects of the plaintiffs' case, deal with some matters relevant to it and have the potential to assist in the preparation of it.
I reject the defendants' submission that this application is premature and the plaintiffs should wait to see what evidence is filed and served by the defendants in these proceedings and then make the application. In my view, the application has been made at an appropriate time so that the plaintiffs can know whether they can take into account the contents of the Relevant Affidavits when they consider the contents of any future evidence. Waiting to receive the defendants' evidence in these proceedings or, worse still, until one or more of the deponents of the Relevant Affidavits give oral evidence at the trial before making this application would run straight into the strictures of the implied obligation not to use the Relevant Affidavits for any purpose other than the Probate Proceedings and the Equity Proceedings.
The defendants were not able to satisfactorily explain how the implied obligation in relation to the Relevant Affidavits (assuming it applied) could be navigated once the evidence of the defendants in these proceedings was received by the plaintiffs.
I consider that achieving justice in these proceedings requires that the plaintiffs be permitted to use the Relevant Affidavits for the purposes of these proceedings.
In my view this is a factor which heavily weighs in favour of the grant of leave to use the Relevant Affidavits for the purposes of these proceedings.

Paul Graham Unicomb v Gregory Scott Blais

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Cases Cited (41)