Discovery
11The present application must be considered against the background of Practice Note SC Eq11, "Disclosure in the Equity Division" (the "Practice Note"):
4. The Court will not make an order for disclosure of documents (disclosure) until the parties to the proceedings have served their evidence, unless there are exceptional circumstances necessitating disclosure.
5. There will be no order for disclosure in any proceedings in the Equity Division unless it is necessary for the resolution of the real issues in dispute in the proceedings.
6. Any application for an order for disclosure, consensual or otherwise, must be supported by an affidavit setting out;
the reason why disclosure is necessary for the resolution of the real issues in dispute in the proceedings;
the classes of documents in respect of which disclosure is sought; and
the likely cost of such disclosure.
12The Practice Note was put into place in response to a concern on the part of the Court, joined in by those who regularly appeared before it, that the practice of extensive disclosure being ordered prior to the parties being required to put on their evidence was producing a result in many cases that was contrary to the overriding purpose set out in ss 56 to 58 of the Civil Procedure Act 2005 (NSW) (the "CPA"). The fundamental overriding purpose is that proceedings be conducted in a way that leads to the just, cheap and quick resolution of the matters really in issue between the parties.
13A particular feature of these proceedings is that they were commenced before the introduction of the Practice Note. Furthermore, consent orders were made for disclosure to take place between the parties in accordance with the practice that existed before the introduction of the Practice Note. However, as events developed, no documents were in fact ever produced in accordance with the earlier arrangements for discovery. I am informed by counsel for the defendants, and accept, that the categories for discovery proposed by the plaintiffs under that earlier arrangement were all objected to.
14The process of discovery, such as it was, was interrupted by interlocutory applications brought by the defendants in relation to, amongst other things, the adequacy of the plaintiffs' pleadings. Those applications resulted in the further amended statement of claim which is now before the Court.
15While the parties were involved in those other interlocutory applications, the Practice Note was introduced. These proceedings therefore fall into the second of the categories identified by Justice McDougall in Leighton International v Hodges; Thiess v Reinforced Earth [2012] NSWSC 458 at [25], being where a regime for discovery was in place but "which had been in effect overtaken by events or abandoned." In those circumstances, the fact that discovery may once have been agreed between the parties prior to the introduction of the Practice Note will not, of itself, constitute or assist in building a case for "the exceptional circumstances necessitating disclosure" referred to in paragraph 4 of the Practice Note.
16Accordingly, I approach the present application as being one that is squarely governed by the Practice Note. That being said, the Practice Note itself must be applied in accordance with the requirements of ss 56 to 58 of the CPA, and, in particular, the overriding purpose to which I have already referred.
17There is much to be said for the defendants' criticism of the form of the application that has been brought by the plaintiffs today. There has not been compliance with the requirement for an affidavit setting out the matters referred to in paragraph 6 of the Practice Note. However, that omission has been remedied in the written and oral submissions put on behalf of the plaintiffs. That is an observation born of the reality of the situation and is not to be taken as a general licence for parties not to comply with the requirements of the Practice Note.
18That being said, having regard to the requirement for progressing this matter to achieve a just, cheap and quick resolution, it is appropriate that I should set aside the question of formal compliance with the Practice Note and look to the real merits of the situation in this particular case.
19Viewing the matter in this way, I am firmly of the view that no circumstances, exceptional or otherwise, have been demonstrated by the plaintiffs so as to justify disclosure being ordered before the filing of evidence of the fiftyone categories of documents to which I referred at the outset of these reasons. Without listing them in detail, most of those categories relate to material which is either already in the possession of the plaintiffs or is of a kind which, under the Practice Note, would almost never be the subject of an order for disclosure prior to the filing of evidence. A good example is those categories which are directed to obtaining the defendants' notes and records of conversations said to have taken place between representatives of the parties. Such material now classically falls within the view taken by the Court that a plaintiff should be readily able to file his, her or its evidence of such matters unaided by file notes and other material from the defendant's camp.
20Recognising the almost insuperable difficulty posed for the plaintiffs by the fifty-one categories, I extended to the plaintiffs an opportunity over the luncheon adjournment to refine their request to a more targeted group of documents which they might be able to demonstrate to me would be discoverable, on the basis that there were "exceptional circumstances necessitating disclosure." That was done and a document produced entitled "Further Schedule of Documents to be Discovered by Wotif.Com Holdings Limited".
21It is necessary then to consider what the circumstances are that the plaintiffs say are "exceptional". Without descending into the detail of the claims between the parties, it is clear that a substantial part of the plaintiffs' case will turn on material that is not presently in the possession of the plaintiffs. However, an examination of the particulars appended to the various allegations in the further amended statement of claim makes it clear that the plaintiffs must have some material on which they are able to make the allegations that they have pleaded, and which one would expect will be included in the evidence which they file as part of their evidence-inchief in due course.
22It nevertheless also appears that there will be a deal of material that may ultimately become relevant which is solely in the possession of the defendants. There is authority for the proposition that such a circumstance, particularly when added to the overriding purpose in s 56 of the CPA, will constitute the exceptional circumstances: In the matter of Mempoll Pty Limited, Anakin Pty Ltd and Gold Kings (Australia) Pty Limited [2012] NSWSC 1057 at [21] per Black J.
23The defendants vigorously disputed the proposition that the unavailability to the plaintiffs of material solely in the defendants' possession constituted exceptional circumstances in this case. That submission reached its high point in the defendants' written submissions where they observed:
There is no expectation that the plaintiffs would prepare lay affidavits in relation to matters that are solely within the knowledge of the defendant. Rather, the defendant will respond to the allegations that it changed the business model of GoDo as it sees fit by way of its own lay evidence, exhibiting any documents it considers appropriate.
24That response exposes the tension that has arisen since the introduction of the Practice Note. The Practice Note contemplates, necessarily, the possibility of a further round of evidence if, after evidence is filed on the first occasion, an application for discovery is successfully made. There is nothing in and of itself wrong with that. However, in exercising the Court's discretion on an application of this kind it seems to me important to bear in mind the possibility that where (as here) I am satisfied much relevant material is only in the possession of the defendants, an application will be made for discovery after the filing of evidence.
25This gives rise to the matter which has persuaded me that in the exercise of my discretion, being satisfied that there are exceptional circumstances in the fact that much of the material that may ultimately come to be relied upon is in the possession of the defendants only, I should ensure that the plaintiffs are in a position to at least advance a sufficiently clear case in the first round of evidence to limit, or perhaps eliminate, the need for a future application for discovery.
26In other words, it seems to me that where one has a case, of which I consider this to be an example, that an application after the filing of evidence is almost inevitable, parties ought to be put in the position where their first round of evidence will go as far as possible to highlight what discovery may in fact be required to fill in gaps that the filing of that evidence discloses. I have reached the view that not to allow discovery of the more limited categories now advanced by the plaintiffs before evidence in this case will mean that any future application for discovery will not be assisted, as far as I think it should be, by a delineating of the issues through the first round of evidence in the fullest way practicable, having regard to the provisions of the Practice Note.
27I am satisfied that the categories in the further revised schedule to which I have referred will elicit material that is solely in the possession of the defendants and are not, on their face, oppressive by reason of the amount of material or the difficulty in identifying it. The disclosure will facilitate the plaintiffs in crafting their evidence-in-chief consistently with the case as pleaded in a way which will ultimately assist in delineating the real issues once the defendants have had an opportunity to respond. My expectation is that if this material is discovered and the parties are then required to put on their evidence, then the combination of the material advanced by the plaintiffs, both from their own resources and that which has been discovered to them by the defendants, as well as the defendants' evidence from their own resources, will put the Court and the parties in the best position to determine what, if any, more discovery is required.
28In reaching this conclusion I have particularly taken into account the fact that as matters presently stand there does appear to be a case for the plaintiffs to be entitled to access to what has been referred to before me today as the "books and records of GoDo Pty Limited". However, I would certainly not make such an order today and I would be very surprised if an order in those terms would ever be made in proceedings before this Court. There are clearly identifiable categories of documents which fall within the general description of "books and records". The orders that I make today should ultimately assist the parties and the Court to determine with appropriate (and considerably greater) precision what, if any, further documents from the "books and records of GoDo Pty Limited" the plaintiffs may be able to satisfy the Court that they would be entitled to have disclosed once the evidence has been filed.
29For these reasons I propose to order discovery in advance of the filing of evidence of the categories identified in the further schedule that was provided after the luncheon adjournment.