Plaintiff v Defendant

Supreme Court of Victoria|2011-08-30|Before: ZAMMIT AsJ

PRACTICE AND PROCEDURE - Discovery - Ediscovery - Application to extend discovery to documents created after the event - Whether a likely claim of privilege prevents discovery - Whether searches extending 40 years are oppressive - Collaborative approach to discovery - Overarching purpose - s 7 Civil Procedure Act 2010 (Vic) - Order 29 Supreme Court (General Civil Procedure) Rules 2005 (Vic).

(1) The third, fourth and fifth defendants, ("the State Parties"), seek general discovery from SPI:

(a) in accordance with SPI's July Proposal;[1]

(b) including discovery for the period from January 2007 to 31 July 2010, of documents contained within:

(i) SPI's Board papers and minutes;

(ii) the Audit and Risk Management Committee (a sub-committee of SPI's Board);

(iii) the Bushfire Litigation Committee (a sub-committee of SPI's Board);[2]

(2) the second defendant, Utilities Services Corporation Limited (trading as Utility Asset Management ("UAM")) seeks discovery pursuant to r 29.01.1 or alternatively 29.05.2; 29.07; or 29.08 that SPI discover documents within the following classes:

copies of any contracts, agreements and/or other documents in SPI's possession, custody or power which within their scope deal with the inspection and/or field services and/or maintenance of the Pentadeen Spur (as defined in SPI's defence and counterclaim) for the period 1994 onwards;

copies of any inspection manuals in SPI's possession, custody or power which pre-date the Asset Inspection Manual (referred to in paragraph 19B(d) of SPI's defence and counterclaim);

copies of any records in SPI's possession, custody or power of the inspection and/or maintenance of the Pentadeen Spur, including (without limitation) any aerial inspections prior to and subsequent to the time at which SPI took over ownership and operation of the distribution network in 1994.

(3) the plaintiff seeks discovery from SPI in accordance with the July Proposal and further that the search strings to be used for all content searches be expanded as set out in paragraph 1 of the plaintiff's summons dated 2 August 2011.

- affidavit by Ruth Elizabeth Overington sworn 3 August 2011 on behalf of SPI;

- Ms Overington's viva voce evidence;

- affidavit of Elizabeth Louise Wroe sworn 3 August 2011 on behalf of UAM;

- two affidavits of Rory John Walsh affirmed 2 August and 4 August 2011 on behalf of the plaintiff;

- affidavit of Nicole Joy Wearne sworn 1 August 2011 on behalf of the State Parties.

3 In summary, I have allowed the State Parties and plaintiff's applications for discovery; such discovery is to be concluded by mid March 2012. I have dismissed the second defendant's application.

4 The plaintiff is the named representative in a group proceeding, under Part 4A of the Supreme Court Act 1986 (Vic).

5 The plaintiff's main allegations against SPI are found in paragraphs 18 and 19 of the third amended statement of claim filed with this Court on 20 June 2011. The plaintiff brings a claim in statutory duty, negligence and private nuisance against SPI, a power company.

6 At a very basic level, the plaintiff alleges that the Kilmore East-Kinglake bushfire ("the Kilmore bushfire") which started on 7 February 2009, started as a result of a failure of the wire conductor between poles 38 and 39 on the single wire-earth-return ("SWER") electricity distribution line, known as the Pentadeen Spur.

7 The span between poles 38 and 39 is referred to in the pleadings as the Valley Span. The plaintiff alleges that the conductor on the Valley Span failed near the western end on the helical fitting on pole 39 and ignited a fire which became the Kilmore bushfire.[3]

8 The particulars of negligence are set out in paragraph 19 of the third amended statement of claim and are grouped under three sub-headings:

(a) Asset Management System Failures;

(b) Asset Inspection System Failures;

(c) Engineering Failures.

9 The pleaded allegations against SPI broadly concern decisions made in relation to the design, construction, operation and maintenance of assets of an electricity distribution network established more than 40 years ago.

10 In issue between the parties are how the conductor failure occurred and whether the failure could have been avoided.

11 There are counterclaims on foot between the defendants. SPI alleges that UAM is a concurrent wrongdoer pursuant to Part IV of the Wrongs Act 1958 (Vic).

12 Relevantly, SPI's counterclaim against UAM concerns an agreement entered into on or about 1 April 2007, under which UAM agreed to provide asset inspection services to SPI throughout the distribution network for three years. Pursuant to the UAM contract, UAM was to conduct an inspection of the Pentadeen Spur in February 2008 in accordance with SPI's Asset Inspection Manual and the requirements of the UAM contract.

13 At its simplest, SPI alleges that throughout the term of the UAM contract, UAM owed the plaintiff a duty of care to ensure that reasonable care was taken by UAM to ensure that conductors and associated hardware on the Pentadeen Spur were adequately inspected and that defects, faults, deterioration in condition or incorrect assembly were adequately identified, reported to SPI and addressed. SPI alleges that UAM failed, following the February 2008 asset inspection or at any time prior to 7 February 2009, to identify or notify SPI of, any problem with the conductor or associated assets forming part of the Valley Span and/or failed to conduct maintenance necessary to rectify any fault.[4]

14 Finally, SPI alleges that if the Kilmore fire was associated with a breach in the conductor in the Valley Span (which it denies), then the Kilmore fire was caused by the UAM's breaches of duty as alleged.[5]

15 For completeness, SPI also alleges the State Parties are concurrent wrongdoers pursuant to Part IV of the Wrongs Act 1958 (Vic) and it brings common law claims against the State Parties and statutory duty claims against the State of Victoria and the CFA.[6]

16 The applications before the Court highlight the current challenges of using discovery as a court procedure. It is important to briefly consider the recent reforms relating to discovery to understand the approach adopted by the parties and to understand my decision.

17 The vast amount of data created and stored by electronic means poses a new challenge for the use of discovery as a court procedure. Discovery is a topic that attracts a great deal of attention due primarily to the exorbitant costs that are incurred by the parties and the delay caused in litigation. The Court has long recognised that discovery disputes, large scale unfocussed discovery exercises and the resulting costs, work against the interests of the parties to the litigation, the operation of the civil justice system and ultimately the interest of the community.

18 Discovery has been the subject of reform over many years. Traditional restrictions on discovery have been removed, for example, enabling discovery before a proceeding is commenced and allowing discovery against non-parties. The Victorian Law Reform Commission ("VLRC") report in March 2008[7] and the Australian Law Reform Commission report in March 2011,[8] were critical of the time and cost involved in discovery, particularly where there are large numbers of electronic documents. Judges have become concerned with the time and costs devoted to discovery often for a comparatively small result in identification of documents relevant to the eventual resolution of the dispute.

19 These concerns have seen the narrowing of the discovery rules and a shift away from the Peruvian Guano test which found its origins in 19th century England.[9]

20 The shift is seen in the recent amendments to the Civil Procedure Act 2010 (Vic) ("CPA"); order 29 of the Rules; and the Supreme Court Guidelines found in Practice Note No. 1 of 2007: Guidelines for the Use of Technology in any Civil Litigation.

21 The overarching purpose of the CPA is to facilitate the "just, efficient, timely and cost-effective resolution of the real issues in dispute."[10] In particular, the CPA flags discovery as an area in need of more judicial control.

22 The Explanatory Memorandum to the CPA expressed concern that discovery had become a largely contested process particularly in complex civil litigation where it has been criticised in a number of high profile cases.[11] The VLRC recommended greater case management of litigation including case management of discovery.

23 The CPA provides that the Court may make any order or give any directions in relation to discovery that it considers necessary or appropriate.[12] The CPA then, without limiting the orders or directions a court may make, lists a series of orders that may be made.[13]

24 The CPA provides that discovery shall be made in accordance with the Rules of the Court or Court order. The new Rules of the Court give effect to the CPA.

25 The recent amendments to Order 29 mirror the Federal Court approach and have narrowed the test for discovery in Victorian Courts from 1 January 2011. The new rules introduce the concept of a "reasonable search, requiring a consideration of proportionality." Under the new rule,[14] the parties must discover any of the following documents of which the party giving discovery is aware after a reasonable search:

- documents that adversely affect their own case or another party's case; and

26 In making a reasonable search a party may take into account:[15]

- the significance of any document to be found; and

27 Finally, Practice Note No.1 of 2007 suggests that the parties agree to limits on discovery, including limits on searches for any category of discoverable documents where searches are considered to be unduly burdensome, oppressive or expensive having regard to the importance or likely importance of the category.

28 The CPA, the recently amended Rules and relevant Practice Notes, highlight that practical models for discovery, rather than strict adherence to legal rules, are the key to resolving problems of discovery in complex litigation where there are large volumes of material stored electronically and in hard copy. When intervening in the discovery process, the Court must try to achieve an optimum balance so that discovery is undertaken by each party in the most timely, efficient and cost-effective manner, while ensuring that discovery is proportionate to the size of the case and appropriate to the interests of justice.

29 Litigation such as this proceeding requires the parties and the Court to be flexible in their approach to discovery. The parties have demonstrated a preparedness to approach discovery in a practical and collaborative manner.

30 SPI has prepared a practical discovery plan, setting out the scope and process of discovery it intends to employ to meet its discovery obligations.

31 SPI's discovery plan includes proposed categories of, and procedures for, identifying documents and information about relevant storage systems, the volume and location of documents, and document retrieval requirements and time estimates for the completion of the discovery plan. A list of people and repositories that might hold relevant documents has been provided to the parties.

32 The parties have met and conferred in relation to the plan for electronic discovery and a protocol has been agreed.

33 In accordance with orders made by the Honourable Justice Forrest on 17 June 2011, the parties made discovery of an initial tranche of documents on 29 July 2011. The first tranche was of documents that each party provided to the Victorian Bushfire Royal Commission ("VBRC"), which are relevant to this proceeding but excluded documents over which privilege was claimed.

34 In total, SPI has provided the parties with a copy of 1,793 documents in the first tranche. The documents had also been provided to the VBRC, which inquired into and reported on the causes and circumstances of the bushfires in various parts of Victoria in late January and in February 2009, including the Kilmore bushfire.

35 The subject of the allegations against SPI in the current proceeding were the subject of hearings in the VBRC. During the course of the hearings, SPI made available to the VBRC detailed witness statements, explanatory papers and other documents relevant to matters in issue in the current proceeding. As at 3 August 2011 there were more than 1,500 pages of evidence and documents which originated from SPI available to download on the Royal Commission website. Further, as a regulated entity, there is information available to the public about the way in which SPI manages its networks on the websites of the Essential Services Commission and the Australian Energy Regulator.[16]

36 Ms Overington provided a written affidavit and gave viva voce evidence on behalf of SPI. I consider that Ms Overington gave her evidence in a candid manner. I found her to be a credible witness.

37 Ms Overington is a senior associate working in the Freehills commercial litigation section. Ms Overington has been working in this section for 10½ years, since she commenced with Freehills as an article clerk. Ms Overington has worked on large scale matters and for the past six years has had primary responsibility for the document production requirements in various investigations and litigation.

38 I accept that Ms Overington is highly qualified in the field of discovery for large corporate entities and that she has extensive and relevant experience in discovery of electronic data (ediscovery).

39 Ms Overington gave evidence about the internal resources employed by Freehills and external resources, which will be used to complete SPI's discovery for this proceeding. I will return to this point. I accept, on the whole, that Ms Overington's evidence regarding the estimated resources and time required for the completion of discovery is reasonable. There was no evidence to contradict Ms Overington and as I have said, I consider her evidence was given in a truthful and measured way and that her viva voce evidence-in-chief and cross-examination was consistent with her written affidavit.

40 SPI has provided to the parties three alternative repository based discovery proposals. The proposal before the Court is referred to as the July Proposal, which as I have said has in large part been accepted by the parties.

41 As a result of the negotiations and discussions between the parties and SPI, it has been agreed in principle that SPI will adopt an alternative approach to discovery, that is, the July Proposal.

42 It is apparent to the Court, that SPI has been consultative and transparent with the parties concerning its approach to discovery. Ms Overington refers to more than 40 items of significant correspondence that have been exchanged between the parties regarding SPI's discovery. Ms Overington or counsel on behalf of SPI, has provided explanations on various aspects of the discovery proposal during the course of case management conferences, directions hearings and two without prejudice discussions with all the parties.

43 Ms Overington anticipates that the July Proposal will involve retrieval and review of:

- 50,000 from the regulatory@spansnet.com.au mailbox;

- 60,000 from individuals, board and sub-committee;

It is estimated that the date of completion of discovery in accordance with the July Proposal by SPI will be 24 February 2012. This will occur in two tranches, the first to be completed by 28 October 2011.

44 The July Proposal is not intended to discover all possibly relevant documents. The July Proposal aims to target the repositories and other sources of data most likely to contain the documents of greatest relevance to the material in issue in the proceeding, and which are capable of being discovered by February 2012.

45 This proceeding is fixed for trial on 17 July 2012.

46 The parties agree that the July Proposal in its current form is appropriate. However, the three discovery applications seek an extension of the scope of the July Proposal and that discovery be completed in a shorter time frame than that estimated by SPI. I will deal with each discovery application in the order they were heard.

47 The State Parties' application seeks from SPI discovery of papers and minutes of SPI's Board and the Audit and Risk Management and Bushfire Litigation sub-committees, from January 2007 to July 2010. SPI agrees that it is appropriate for it to discover papers and minutes of the Board and the Audit and Risk Management Sub-Committee minutes from January 2007 to February 2009. On the basis that it is likely that they will be the subjects of a claim of legal-professional privilege, SPI submits that it should not have to discover the Bushfire Litigation Sub-Committee papers and minutes. Therefore, SPI submits that given it is already subject to a substantial discovery burden, the discovery of additional material, which is likely to be the subject of a legal-professional privilege, is unwarranted.

48 In relation to the papers and minutes of the Board and the Audit and Risk Management Sub-Committee, the only issue before the Court is whether SPI's discovery should be limited to the period of 1 January 2007 to February 2009 or the period of 1 January 2007 to 31 July 2010 (inclusive), thereby including the period after the Kilmore bushfire.

49 SPI accepts that the documents, which may evidence any change to its approach to asset management since February 2009, could be tangentially relevant to matters in issue in the proceeding. However, SPI does not accept that these documents are likely to be probative in light of their retrospective value.[17]

50 In any event, SPI submits that the July Proposal does go beyond February 2009 in some limited cases.

51 SPI's evidence is that if relevant documents are identified in addition to what would be expected from searches set out in the July Proposal, such documents would be discovered, including documents created post-7 February 2009.

(a) SPI acknowledges that the documents from February 2009 to 31 July 2010 are relevant, albeit tangentially;

(b) there is no material before the Court to suggest that the documents sought would be voluminous in number or that it would pose an onerous task upon SPI to locate the relevant minutes and papers;

(c) there is no evidence before the Court that the documents will be in the whole privileged;

(d) if privilege is claimed by SPI over the documents, the State parties are entitled to consider whether they wish to challenge any such claim.

53 The State Parties rely on the decision of Perry v Powercor.[18] His Honour Robson J found that Powercor had not established that reports (over which they had claimed privilege) were protected by legal-professional privilege. His Honour ordered that Powercor provide the reports to the plaintiff for inspection. Perry's case concerned the bushfires on 7 February 2009, northwest of Coleraine. Powercor is the distributor of electricity in Western Victoria and the operator of the electricity network. It is alleged that a faulty Powercor power line that passed over a farming property started the bushfire.

54 The documents in question in Perry's case were all created after 7 February 2009.

55 In relation to the papers and minutes of the Audit and Risk Management Sub-Committee and SPI Board, I am not satisfied that the additional burden of discovering minutes and papers in the period from February 2009 to 31 July 2010 would be onerous upon SPI. The temporal period sought is confined. In the circumstances of the case, taking into account the controversial issues, SPI's resources and the potential importance of the proposed discovery in resolving the issues between the parties. I consider it appropriate that SPI extend discovery to include the period to 31 July 2010.

56 The only evidence before the Court in relation to the papers and minutes sought of the Bushfire Litigation Sub-Committee, is that it is likely that they will be the subject of a claim of legal-professional privilege.[19] There is no evidence of the burden or expense of the proposed discovery. There is no evidence that SPI does not have the resources to meet the additional discovery burden, only that SPI is already subject to a substantial discovery burden.[20]

57 The name of the sub-committee suggests that it was created for the purpose of this litigation and to manage and seek advice in relation to this litigation. However, a mere assertion that the name of the committee and that its papers and minutes are likely to be the subject of a legal-professional privilege claim is not a sound basis upon which to exclude such documents from discovery. The decision in Perry v Powercor[21] confirms that such an approach is unjustified. Accordingly, I consider that SPI should discover the Bushfire Litigation Sub-Committee papers and minutes for the period 1 January 2007 to 31 July 2010.

58 UAM accepts SPI's July Proposal is appropriate. However it seeks general discovery of a further 3 classes of documents.

59 UAM submits that how SPI managed its network assets prior to 7 February 2009 is an issue in the proceeding. Therefore, documents relating to SPI's approach to asset management, including the analysis of any decision made by SPI to change its inspection cycles or change how it inspected its assets are relevant.

60 In relation to classes 1 and 2 documents, UAM submits that such documents will in all likelihood record information as to the content and requirements of inspections and maintenance of the Pentadeen Spur and any changes to the manner in which those assets were to be inspected at any time prior to February 2009.

61 UAM submits that classes 1 and 2 documents are relevant in that they relate to issues raised by the pleading. In dispute is the cause of the fire, particularly the alleged failure of the conductor. UAM submits that these allegations (raised in the third amended statement of claim at paragraphs 18 and 19 and paragraphs 312 to 322 of SPI's amended defence and counterclaim) raise the issue of possible systemic failure and possible faults that may have occurred over an extended period of time. In line with this argument, UAM submits that inspection manuals in SPI's possession over an extended period of time are relevant.

62 SPI submits that any documents that fall from repositories or from the archival box searches undertaken in accordance with the July Proposal, that come within classes 1 and 2 documents sought by UAM, will be discovered. SPI submits that to extend the search beyond the July Proposal would be onerous. Importantly, SPI submits that the repositories identified in the July Proposal are most likely to contain the documents of greatest relevance to matters in issue in the proceeding that are capable of being discovered by February 2012.

63 On the latter point, UAM submits that the Court must not allow the process of discovery to dictate the outcome. That is, if the outcome sought by the parties is just then the Court must ensure that such discovery is provided.

64 UAM seeks discovery of all contracts and agreements that SPI may have had with any third party relating to the inspection and maintenance of the relevant assets. UAM submits that the documents are essential to the proper conduct of this litigation and therefore they should be discovered.

65 While information about earlier inspection manuals and contract agreements dealing with assets and inspection may have some relevance, I do not consider it appropriate that SPI embark upon an extensive discovery exercise beyond the July Proposal and the first tranche of documents already provided by the parties. UAM wants discovery of material going back to 1994 in order to see what other contracts were in place between SPI and other inspection maintenance/service providers. UAM submits SPI has not put any evidence before the Court as to its ability to identify the documents or if such an exercise will be oppressive. Ms Overington's evidence is that there are approximately 15,700 archive boxes held on behalf of SPI and that the task of retrieving and searching these boxes would take several years.

66 UAM relied on the decisions of Galati v Potato Marketing Corporation of Western Australia (No 2)[22] and Oberdan v Commonwealth Bank of Australia.[23] I do not consider these cases of assistance. Neither case considers discovering in the context of the current litigation, that is, commensurate with its complexity and size. Galati and Oberdan were not cases, which existed in the background of a Royal Commission. They were cases where the parties were refusing to give discovery or to provide further and better discovery. Further, they were decided under the old Peruvian Guano test.

67 In relation to the July Proposal, the evidence before the Court is that the central focus of the July Proposal is asset management. Therefore, SPI submits that the repositories most likely to hold documents responsive to the classes of documents sought by UAM are those listed. By way of example, Ms Overington in her affidavit notes that the July Proposal contemplates the:

(a) conduct of reasonable searches of the protection, control and automation share drive;

(b) conduct of reasonable searches of desktop and hard drives and hard copy files of the Asset Manager Lines and Senior Design Engineer, North Region;

(c) review of 250 archive boxes (identified as likely to be the most relevant by reference to available information concerning their contents and location prior to being archived); and

(d) production of:

(I) all available electronic information concerning the maintenance inspection activities of the Pentadeen Spur;

(ii) data regarding the assets comprising poles 38 and 39 on the Pentadeen Spur;

(iii) records of the protection settings for the protection device (otherwise known as an oil based automatic circuit reclosure).

68 It is implicit that there may be other repositories or that a search of all 15,700 archive boxes could reveal documents that fall within classes 1 and 2. However, I do not consider the value of earlier third party agreements concerning the inspection of assets within SPI's electrical distribution network sufficient to warrant a wholesale search of archive boxes and additional repositories. The time and cost of such an exercise is not proportionate to the likely benefit. The same logic applies to discovery of earlier asset inspection manuals.

69 In relation to class 3 documents, UAM wants discovery of documents relating to the actual inspection and maintenance records of the Pentadeen Spur for the entire existence of the line, that is, some 40 years. While the state of the assets and their inspection prior to the fire on 7 February 2009 is relevant, discovery over such a period is not reasonable. I am satisfied that embarking upon such a discovery exercise would be unduly burdensome and costly.

70 This is not a case where documents relating to the inspection and maintenance of the Pentadeen Spur are not to be discovered. To the contrary, the repositories and searches to be conducted by SPI are directed to this issue but confined temporally. Ms Overington's evidence was that the issue of maintenance and inspection of the Pentadeen Spur was canvassed at the VBRC and that documents on this point were provided to the VBRC and now to the parties. SPI submits that the documents evidencing prior inspections to the UAM contract may be potentially relevant to demonstrate, what was found on earlier inspections. However at the heart of this proceeding and therefore most relevant as between SPI and UAM, is the inspection of poles 38 and 39 in the Pentadeen Spur from the commencement of the UAM contract.

71 SPI submits that the only relevant documents are those dealing with the asset inspection of poles 38 and 39 on the Pentadeen Spur by an employee of UAM in February 2008 or any time prior to 7 February 2009.

72 UAM consider the records of inspections and maintenance work carried out on the Valley Span at any time prior to 7 February 2009 is put into issue by SPI's pleadings.[24]

73 I consider the most relevant documents are those concerning UAM's inspection in February 2008 or any other inspection before the Kilmore bushfire on 7 February 2009.

74 The July Proposal will provide discovery of the Q4 database. This database contains information concerning the maintenance and inspection activities on the Pentadeen Spur from 2000 to date. Therefore, the July Proposal will include inspection and maintenance records before the UAM contract.

75 Ultimately, the pleadings relate to UAM's inspection in February 2008 or any inspection by UAM before 7 February 2009. The July Proposal already goes beyond the specific allegations pleaded. To extend discovery to including class 3 documents would be oppressive and cause unjustified delay in this proceeding.

76 UAM seeks confirmation that documents falling within the classes of documents will be discovered in the proceeding. To do so, SPI will need to exhaust all possible searches. As discussed, such a search of only the archive boxes could take years.

77 In conclusion, given the matters pleaded, the July Proposal, the first tranche of discovery and the documents in the public domain, I consider UAM's application should be dismissed.

78 The July Proposal is reasonable and proportionate and is likely to discover the most relevant and critical documents. Further, Ms Overington, an officer of the Court, has given evidence that should any documents that fall into the 3 classes of documents fall from the July Proposal then they will be discovered.

79 At the conclusion of the hearing the plaintiff only pressed paragraphs: 1(a)(i); 1(b); 2 and 4 of its summons.

80 Paragraph 1(b) has been dealt with by the State Parties' application.

81 Paragraph 1(a)(i) sets out the plaintiff's contention that, in addition to the search strings in the July proposal, there should also be additional search strings as set out in paragraph 1(a)(i)(A) to (J) inclusive.

82 The plaintiff seeks completion of discovery by SPI of the July Proposal with the additional search strings in two tranches: the first tranche by 28 October 2011 and the second tranche by 12 December 2011.

83 SPI submits that if it were to provide discovery in accordance with the July Proposal and the additional search strings, it would add three weeks to its estimate, therefore pushing the completion of discovery to mid-March 2012.

84 The modifications to the search strings are not opposed by SPI. The only issue before the Court is the timing of discovery.

85 Ms Overington agreed that the modifications to the search strings are likely to produce relevant documents. The plaintiff submits that the current search strings would miss highly relevant documents.

86 The plaintiff's solicitors have identified the steps that they will need to undertake once SPI makes discovery, prior to the 17 July 2012 trial date.

87 Once SPI makes discovery the plaintiff will then need to:

(a) review and analyse the discovery;

(b) prepare briefs to experts on the basis of the discovered materials;

(c) conduct expert conclaves and prepare a joint report; and

(d) participate in mediation.

88 The plaintiff does not consider that it will be able to complete these steps prior to July 2012 if discovery is completed by mid-March 2012.

89 I accept that the plaintiff will be placed in a more difficult position if SPI's discovery is completed in March 2012 with a trial date in mid-July 2012.

90 The plaintiff submits that SPI is able to make discovery by 12 December 2012 and should be ordered to do so by the Court. The plaintiff submits that SPI is a major corporation and it has not advanced evidence to show that any interests of justice are threatened by imposing on it an obligation to apply more legal resources in order to meet the accelerated timetable set by the Court. The plaintiff submits that if the Court orders discovery by early December 2011, SPI will find a way to do so.

91 The plaintiff submits that the number of people currently allocated and proposed for discovery is inadequate and that if more human resources were applied earlier the process would be completed sooner.

92 As I said, Ms Overington gave the only evidence before the Court in relation to SPI's timing estimates for discovery. Ms Overington provided evidence of the different personnel, their experience and how they would be used in the discovery exercise. Ms Overington conceded that these people would not all be exclusively working on the discovery process and that included in the numbers were partners of Freehills who were unlikely to be actually involved in any hands-on tasks. I accept Ms Overington's evidence that allocating more resources to the discovery process will not necessarily reduce the duration of the discovery. Ms Overington explained that introducing additional staff could reduce some stages of discovery. However, unless staff are suitably trained and qualified, there is a risk of inconsistency which is likely to prolong the later stages of discovery. Ms Overington accepted that allocating some extra human resources could at least reduce the time to complete the remaining interviews and extract electronic files from various SPI repositories, which would then expedite the provision of the data to Freehills' external provider. Ms Overington's evidence also covered the issue of "machine time". That is, there were aspects of ediscovery, which could not reasonably be expedited by applying more human resources as those steps were dependent on the computers and time that running different software would take (for example Quick Peek).

93 Over the course of the hearing the Court heard evidence from Ms Overington about the steps involved in ediscovery, which included preservation and collection of data, processing analysis and review, production of data, review and analysis by the legal personnel. The ediscovery process involves the use of paralegals, IT consultants, external processing consultants and experienced solicitors.

94 The plaintiff's submissions that SPI will be able to fulfil their request because it is a major corporation and it has been given a deadline by the Court, is simplistic. The submission ignores the evidence before the Court and underestimates the complexity of the task to be undertaken by SPI to complete discovery in accordance with the July Proposal.

95 The additional time sought by SPI to complete the July Proposal including the additional search strings is in the order of three months. The additional search strings are relevant and should be included in the July Proposal.

96 SPI has indicated to the Court that it will be able to provide the first tranche of the July Proposal by 28 October 2011. This is in addition, as already discussed, to the first tranche of documents provided by SPI on 29 July 2011.

97 Taking into consideration the reasonableness of the plaintiff's request, the additional time of three months, the task imposed upon SPI and its solicitors and the interests of justice, I consider that SPI should provide discovery in accordance with the July Proposal with the additional search strings and that such discovery should be completed in the two-stage process, the first stage being completed by 28 October 2011 and the second stage by 16 March 2012.

98 If the parties are concerned about the trial date and their ability to be properly prepared, they should direct these concerns immediately to His Honour Justice Forrest.

SPI Electricity Pty Ltd make discovery in this proceeding, limited to the July Proposal as amended by the plaintiff's search strings in the plaintiff's summons dated 2 August 2011;
further to paragraph (1) above, to include discovery of:

(a) the Board papers and minutes provided to, produced by or for the consideration of the Board of Directors of the "stapled entity" (referred to in the affidavit of Ruth Elizabeth Overington sworn 3 August 2010) between the period 1 January 2007 and 31 July 2010 (inclusive);

(b) the papers and minutes provided to, produced by or for the consideration of the following sub-committees of the Board of Directors of the "stapled entity";

(i) the Audit Risk Management Committee; and

(ii) the Bushfire Litigation Committee;

between the period 1 January 2007 to 31 July 2010 (inclusive).

Discovery by SPI in accordance with paragraphs 1 and 2 be completed in two stages:

(a) the first tranche by 28 October 2011 and that this first tranche should include the documents referred to in paragraph (2) of this order;

(b) the second tranche of discovery to be completed by 16 March 2012.

Details of the July Proposal be kept confidential until any further order of the Court.
The second defendant's summons dated 1 August 2011 is dismissed.

100 Subject to hearing the parties on costs I consider that there has been a genuine attempt by all parties to resolve discovery issues without requiring the Court's intervention. The applications before the Court are in effect an extension of the collaborative process. Having heard the evidence I consider each party and the Court has benefited from a fuller understanding of the discovery process to be undertaken by SPI. This has been reflected by the fact that UAM and the plaintiff did not press for all matters in their summonses. Despite best intentions it is unlikely that parties could have gained an understanding of the discovery issues in the absence of Ms Overington giving evidence to the Court.

101 As noted, subject to hearing from the parties, I consider that reserving costs is appropriate given the process of negotiation and conferring that has taken place alongside these applications.

[1] Affidavit of Nicole Joy Wearne sworn 1 August 2011, Exhibit NJW-9.

[2] The plaintiff also seeks discovery by SPI in the same terms as the third, fourth and fifth defendants as described in 1(b)(i), (ii) and (iii).

[3] Plaintiff's second Amended Writ and Third Amended Statement of Claim at [18].

[4] SPI's Amended Defence and Counterclaim dated 16 June 2011 [320] - [321].

[5] SPI's Amended Defence and Counterclaim dated 16 June 2011 [322].

[6] SPI's Amended Defence and Counterclaim dated 16 June 2011.

[7] Victorian Law Reform Commission, Civil Justice Review, Report No 14 (2008).

[8] Australian Law Reform Commission, Managing Discovery: Discovery of Documents in Federal Courts, Report No 115 (2011).

[9] Comagnie Financiere et Commerciale du Pacifique v Peruvian Guano Company (1882) 11 QBD 55.

[11] The Explanatory Memorandum at [22].

[16] Affidavit of Ruth Elizabeth Overington sworn 3 August 2011, [25].

[17] Affidavit of Nicole Joy Wearne sworn 1 August 2011, Exhibit NJW-9.

[19] Affidavit of Ruth Elizabeth Overington sworn 3 August 2011 at [57].

[20] Affidavit of Ruth Elizabeth Overington sworn 3 August 2011 at [58].

[24] Amended defence and counterclaim of the first defendant at [320].

Court (General Civil Procedure) Rules 2005

At a glance

Court

Decision date

Before

Source

Judgment (142 paragraphs)

Legislation Cited (24)