Street & Ors v Luna Park Sydney Pty Ltd & Anor

The charge against Mr Hearne 12 The Supreme Court Rules 1970, Pt 55 continue to apply to contempt proceedings. Part 55 r 6(1) provides, relevantly for present purposes, that where contempt is committed in connection with proceedings in the Court, an application for punishment for the contempt must be made by motion on notice in the proceedings. Part 55 r 7 provides, relevantly for present purposes, that a statement of charge, that is, a statement specifying the contempt of which the contemnor is alleged to be guilty, shall be filed with the notice of motion. 13 The charge filed with the notice of motion in Mr Hearne's case charged him that by his conduct as particularised he breached the implied undertaking to the Court not to use affidavits or expert reports served on behalf of the plaintiffs in whole or in part or the information contained in them for any purpose not directly connected with the conduct of the proceedings and was thereby guilty of contempt of the Court. 14 The particulars alleged that when the proceedings were commenced, Mr Hearne was the managing director of Luna Park Sydney and continued to be a director. By his participation in the proceedings it was alleged that Mr Hearne gave an implied undertaking to the Court not to use affidavits or expert reports served on behalf of the plaintiffs, in whole or in part, or the information contained in them, for any purpose not directly connected with the conduct of the proceedings. The service on Luna Park Sydney of Mrs Hesse's affidavit and Dr Tonin's report was set out. The particulars stated that on 1 July 2005 the proceedings were set down for hearing before Brereton J for two weeks commencing on 31 October 2005. 15 The particulars then identified Mr Hearne's request of the Minister for amending legislation, the transmission of his email of 25 July 2005 and the identification of that email: "(e) On 25 July 2005, Mr Hearne asked the Minister for Tourism, Sport and Recreation, Sandra Nori MP to consider introducing legislation which would amend the Luna Park Site Act so as to ensure that the operations of Luna Park would be protected against the complaints which were the subject of these proceedings and any future complaints about the emission of noise from Luna Park. (f) On 25 July 2005, Mr Hearne transmitted an email to Minister Nori and to Marcus Schintler of her office and to David Tierney, with the three (3) attachments referred to in the email (the "Hearne email"). (g) The Hearne email is annexure "F" to the affidavit of Peter Wise sworn on 15 March 2006." 16 The particulars then alleged that the extracts from Mrs Hesse's affidavit and Dr Tonin's report were used by Mr Hearne for a purpose not directly connected with the conduct of the proceedings and, further, that by transmitting the Daily Telegraph article, Mr Hearne republished the contents of the plaintiffs' affidavits and used them for a purpose not directly connected with the conduct of the proceedings: "(h) By transmitting extracts from the Fifth Plaintiff's affidavit and Dr Tonin's report (attachment 3 to the Hearne email) to Minister Nori and Mr Schintler, Mr Hearne used the affidavit and the expert report for a purpose not directly connected with the conduct of the proceedings, namely to support the request particularised in paragraph (e) hereof. (i) Further, or alternatively by transmitting the Daily Telegraph article (attachment 2 to the Hearne email) to Minister Nori and Mr Schintler, Mr Hearne republished the contents of the Plaintiffs' affidavits referred to in the said article and used those affidavits for a purpose not directly connected with the conduct of the proceedings namely to support the request particularised in paragraph 1(e) hereof." 17 A second charge was laid against Mr Hearne, arising out of the same particulars, that he knowingly published a communication that created a real tendency to interfere with the administration of justice in the proceedings: "(g) By transmitting the email to Minister Nori after he had requested her to consider introducing legislation to amend the Luna Park Site Act, so as to ensure that the operations of Luna Park would be protected against noise complaints made in these proceedings, Mr Hearne knowingly published a communication that created a real tendency to interfere with the administration of justice in these proceedings." The charge against Mr Tierney 18 Similar charges were laid against Mr Tierney. First, it was alleged that he breached the implied undertaking to the Court not to use affidavits or expert reports served on behalf of the plaintiffs, in whole or in part, or the information contained in them, for any purpose not directly connected with the conduct of the proceedings. Secondly, he was charged that by the conduct particularised with respect to the first charge he knowingly published a communication that created a real tendency to interfere with the administration of justice in the proceedings. 19 The particulars alleged that Mr Tierney was employed as development manager of Multiplex Developments, was employed as strategic adviser of Multiplex Developments or had otherwise been associated with the development of Luna Park and involved with its day to day operations on behalf of Multiplex or one of its subsidiary companies. 20 Metro Edgley's 50% shareholding in Luna Park Sydney was alleged as was Multiplex's position as the ultimate holding company of Multiplex Developments and Metro Edgley. 21 The particulars then asserted that by Luna Park Sydney's participation in the proceedings, Mr Tierney gave the implied undertaking to the Court or, alternatively, he was obliged by the implied undertaking given by Luna Park Sydney: "(d) By the First Defendant's participation in the proceedings, Mr Tierney gave an implied undertaking to the Court not to use affidavits or expert reports served on behalf of the Plaintiffs, in whole or in part, or the information contained in them, for any purpose not directly connected with the conduct of the proceedings. (e) Alternatively, Mr Tierney was obliged by the implied undertaking given to the Court by the First Defendant not to use affidavits or expert reports served on behalf of the Plaintiffs, in whole or in part, or the information contained in them, for any purpose not directly connected with the conduct of the proceedings, upon his receipt of the said affidavits or expert reports." 22 In like terms to the charge against Mr Hearne, the particulars recited the plaintiffs' service of Mrs Hesse's affidavit and Dr Tonin's report, the setting down of the proceedings for hearing, Mr Hearne's request of the Minister of 25 July 2005 and Mr Hearne's email and the identification of it. 23 The particulars then stated that on 11 October 2005 the New South Wales Government announced the introduction of the Luna Park Site Amendment (Noise Control) Bill 2005 into the Legislative Assembly and that on 13 October 2005 Mr Tierney transmitted an email to Minister Nori and Paul O'Grady of her office and forwarded the Hearne email to them. 24 In like terms to the Hearne charge, it was then alleged that by transmitting the extracts from the affidavit and report, Mr Tierney used them for a purpose not directly connected with the conduct of the proceedings but in support of the request for amending legislation. Alternatively, by transmitting the Daily Telegraph article, it was alleged that Mr Tierney republished the contents of the plaintiffs' affidavits referred to in the article and used that material to support the request for amending legislation. 25 The second charge, that Mr Tierney knowingly published a communication that created a real tendency to interfere with the administration of justice in the proceedings was, like the charge against Mr Hearne, based upon the relevant particulars of the first charge. The implied undertaking 26 When information is obtained by a party to court proceedings by compulsive discovery, the party and his or her solicitor are bound by an implied undertaking not to use the information for any collateral or ulterior purpose and to confine their use to the purposes of the proceedings. That principle was established by the House of Lords in Harman v Secretary of State for the Home Department [1983] AC 280 at 304 where Lord Diplock said: 'This is why 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 the 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." 27 In Riddick v Thames Board Mills Ltd [1977] QB 881 at 895 Lord Denning explained that the reason for compelling discovery 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 that is in making full disclosure. 28 In Harman their Lordships were of the view that the undertaking continued notwithstanding the fact that the documents in question were read out in open court at the hearing of the action, whether admitted in evidence or not. 29 That is not the position in New South Wales. In Esso Australia Resources Ltd v Plowman (1994-1995) 183 CLR 10 at 32-33, Mason CJ cited Riddick and Harman and said that in relation to documents produced by one party to another in the course of discovery and proceedings in a Court, there is an implied undertaking, springing from the nature of discovery, by each party not to use any document disclosed for any purpose otherwise than in relation to the litigation in which it is disclosed. His Honour went on to say that the implied undertaking was subject to the qualification that once material was adduced in evidence in Court proceedings it became part of the public domain, unless the court restrained publication of it. 30 That is the express position in this State under the Uniform Civil Procedure Rules 2005, r 21.7 which provides that no copy of a document or information from a document obtained by party A as a result of discovery by party B is to be disclosed or used otherwise than for the purposes of the conduct of the proceedings, except by leave of the Court unless the document has been received into evidence in open Court. 31 The undertaking is not confined to discovered documents. It applies equally to witness statements (Central Queensland Cement Pty Ltd v Hardy (1989) 2 Qd R 509 at 510-511). It applies to answers to interrogatories (Central Queensland Cement at 510, Ainsworth v Hanrahan (1991) 25 NSWLR 155 at 167-168). The undertaking is not confined to documents but extends to information derived from such documents (Crest Homes Plc v Marks [1987] AC 829 at 854). 32 I had occasion to discuss the authorities in Moage Ltd (in liq) v Jagelman (2002) 43 ACSR 173 at [10]-[13]. (See, also, Aarons v Maloney [2005] NSWSC 795 at [19]). The position of a director 33 The undertaking is that of the party and his or her solicitor. Thus it is not disputed that the forwarding of portion of the affidavit of Mrs Hesse to Marcus Schintler on 25 July 2005 constituted a breach of an implied undertaking given by Luna Park Sydney. But it was argued that there was no implied undertaking given by Mr Hearne, and a director can only be guilty of contempt for a breach of an undertaking by his company if the director was aware of the undertaking. 34 In Ronson Products Ltd v Ronson Furniture Ltd [1966] Ch 603, Stamp J concluded that the directors of the defendant company, knowing of the undertakings and procuring a breach of them, were themselves liable for contempt, notwithstanding that they had not been served with the order containing the undertakings, since they were not of a positive, but of a negative character, and the directors knew of them. (See Borrie & Lowe, The Law of Contempt, (3rd ed), Butterworths, London, 1996 at 578-582). 35 In Seaward v Paterson [1897] 1 Ch 545, North J drew a distinction between a motion to commit a man for breach of an injunction on the ground that he was bound by the injunction, and a motion to commit a man on the ground that he had aided and abetted a defendant in breach of an injunction. His Lordship held that the Court had undoubted jurisdiction to commit for contempt a person not included in an injunction or a party to the action who, knowing of the injunction, aided and abetted a defendant in committing a breach of it. 36 In Madeira v Roggette Pty Ltd (1990) 2 Qd R 357 at 364, de Jersey J cited Ronson and Seaward for the proposition that a director, ignorant that an order had been made, should not be found guilty of his company's contempt. His Honour said that the requirement for notice was too well entrenched to permit one to conclude otherwise. The position of a third party 37 In Distillers Co (Biochemicals) Ltd v Times Newspapers Ltd [1975] QB 613 at 621, Talbot J said that the protection from publication and use of discovered documents extended to those persons into whose hands the documents come. His Lordship said: "Those who disclose documents on discovery are entitled to the protection of the court against any use of the documents otherwise than in the action in which they are disclosed. I also consider that this protection can be extended to prevent the use of the documents by any person into whose hands they come unless it be directly connected with the action in which they are produced." 38 That was a case where an injunction was sought to restrain the use or disclosure of the documents. It was not a charge of contempt against a third party into whose hands discovered documents had come. 39 But in Hamersley Iron Pty Ltd v Lovell (1998) 19 WAR 316, Anderson J, with whom Pidgeon and Ipp JJ agreed on this point, put the matter on the basis that the implied undertaking extends to third parties into whose hands discovered documents come, if they know they were obtained by way of discovery. His Honour said at 334-335: "The implied undertaking was certainly binding on the CEPU as a party in the main action and it was also binding on Mr Lovell. The implied undertaking is binding upon anyone into whose hands the discovered documents come, if he knows that they were obtained by way of discovery: see Distillers Co (Biochemicals) Ltd v Times Newspapers Ltd [1975] QB 613 at 621." Knowledge as an element of the first charge 40 Judicial discussion of the implied undertaking of a party and solicitor not to misuse material obtained from an opposing party in civil proceedings is couched in strict liability terms in the sense that knowledge of the implied undertaking is not stipulated as an element of a contempt charge arising from a breach of the undertaking. 41 That approach appears to have been adopted by Mr Parker SC who, with Mr Baird, appeared for Messrs Hearne and Tierney in making the concession that Luna Park Sydney breached its undertaking by the action of Mr Hearne in forwarding a portion of Mrs Hesse's affidavit to Mr Schintler in the absence of any evidence of involvement by the solicitor for, or any other person on behalf of, Luna Park Sydney. 42 On the other hand, judicial consideration of the position of a director with respect to a company's breach of an undertaking requires the director to have had knowledge of the undertaking as an element of a charge of contempt against the director. 43 All charges of contempt must be established beyond reasonable doubt (Witham v Holloway (1995) 183 CLR 525 at 534). There is no reasonable doubt that Mr Hearne sent the email of 25 July 2005. But in the absence of any evidence of his knowledge of the implied undertaking given by Luna Park Sydney and its solicitors, I am not prepared to find Mr Hearne guilty of contempt of court in forwarding any of the contents of his email. 44 There is no evidence that Mr Hearne gave any undertaking to the Court. The implied undertaking was that of Luna Park Sydney and its solicitors. I do not regard myself as bound by Hamersley Iron on principles of comity to find that Mr Hearne gave an implied undertaking to the Court. In the first place, the observations of Anderson J go beyond what was said by Talbot J in Distillers Co. In the second place, they require a third party charged with a breach of an implied undertaking to know that the documents were obtained by way of discovery. There was no evidence that Mr Hearne knew that the documents had been discovered and for reasons that appear later in these reasons I am not prepared to infer that he knew the documents had been discovered. The public domain argument 45 It was submitted that the plaintiffs had not established that Dr Tonin's report was not in the public domain. Mr Wise was cross-examined on this issue. He had not given the report to any of the plaintiffs. He had quoted passages from it to some of the plaintiffs including Mr Billington who was a spokesman for the plaintiffs and might have made statements to the press about the report. 46 The Mosman Daily of 16 June 2005 carried an article in which Mr Billington was reported as saying that the residents' report showed noise levels were still unacceptably high. The article reported Mr Billington as saying: "our noise experts advise Luna Park is still too noisy - more than double acceptable standards." 47 The submission has to be viewed in context and the context is that there were mere references to a residents' report and to some conclusions in it. That is insufficient, in my view, to put Dr Tonin's report into the public domain.

Mr Tierney's position 48 Similar considerations apply to the first charge against Mr Tierney save for two aspects. 49 First, in his email to Mr O'Grady, Mr Tierney observed that some of the key lines from Mrs Hesse's affidavit could not be quoted as it could be in contempt of court. It was submitted that the inference to be drawn was that Mr Tierney clearly understood that the documents had been discovered and that to publish them would constitute a contempt of court. 50 As to the first of these elements, I am of the view that the inference arises beyond a reasonable doubt. But as to the second element, it is clear that Mr Tierney misunderstood the nature of the implied undertaking. He thought it applied to dissemination to the public alone, for his warning is to the recipient. The inference is inescapable that he did not regard his publication of the material as constituting a breach of any implied undertaking. 51 The other respect in which Mr Tierney's case differs from that of Mr Hearne is that he was not a director of Luna Park Sydney. Nor did his position with Multiplex Developments, and its relationship with Luna Park Sydney or Metro Edgley promote him to a similar status as that of a director. Mr Tierney gave no undertaking to the Court and the case against him must, therefore, be limited to the case of the third party into whose hands discovered material comes. 52 It was submitted that it could be inferred that Mr Hearne advised Mr Tierney that the documents had been discovered and, in consequence, it could be inferred that Mr Hearne had knowledge of the implied undertaking given by Luna Park Sydney and its solicitors. I reject that submission. Such an inference could not, in my view, be drawn beyond a reasonable doubt. Nor was knowledge particularised as an element of the first charge against either Mr Hearne or Mr Tierney. 53 In my view, therefore, neither of the first charges against Mr Hearne and Mr Tierney have been made out. The alternative charges 54 The alternative charge, that by transmitting the Daily Telegraph article, Mr Hearne and Mr Tierney republished the contents of the plaintiffs' affidavits, does not bear scrutiny. Neither Mr Hearne nor Mr Tierney was charged with contempt by reason of releasing the affidavits to the Daily Telegraph at about the time the article was written. They are charged with republishing the extracts from the plaintiffs' affidavits set out in the newspaper article. 55 This charge is to be contrasted with the situation where a person goes back to the affidavits and publishes another article quoting from, or summarising material in, the affidavits. 56 Once the Daily Telegraph article was published, the extracts from the plaintiffs' affidavits were in the public domain and the mere republication of the article could not constitute contempt. If it did, it would mean that every time a person handed to another person a press statement made in contravention of an implied undertaking, that person would be guilty of contempt. That cannot be the law, with respect.

The second charges 57 It was conceded that neither of the second charges would stand if Messrs Hearne and Tierney were not in breach of an implied undertaking. That being the case, it is unnecessary for me to deal with these charges. But in case I be wrong in my view about the first charges, I deal briefly with this issue. 58 Lord Diplock's statement about due administration of justice in Attorney-General v Times Newspapers Ltd [1974] AC 273 at 309 was relied upon to ground the second charges. His Lordship said: "The due administration of justice requires first that all citizens should have unhindered access to the constitutionally established courts of criminal or civil jurisdiction for the determination of disputes as to their legal rights and liabilities; secondly , that they should be able to rely upon obtaining in the courts the arbitrament of a tribunal which is free from bias against any party and whose decision will be based upon those facts only that have been proved in evidence adduced before it in accordance with the procedure adopted in courts of law; and thirdly that, once the dispute has been submitted to a court of law, they should be able to rely upon there being no usurpation by any other person of the function of the court to decide it according to law. Conduct which is calculated to prejudice any of these three requirements or to undermine the public confidence that they will be observed is contempt of court." 59 In Harkianakis v Skalkos (1997) 42 NSWLR 22 at 27-30, Mason P derived a number of propositions from the reported cases on contempt by improper pressure on a litigant party. The plaintiffs relied on the second proposition, ie, the claimant must demonstrate, to the criminal standard, that the publication had "as a matter of practical reality, a tendency to interfere with the course of justice in a particular case". Reliance was also placed upon proposition 7, namely, successful interference with a party's conduct of proceedings is not necessary for proof of liability for contempt by improper pressure. This is indicated by the "tendency" formulation itself, and is a feature shared with other aspects of contempt, such as contempt by publication of material having a tendency to prejudice potential jurors. Even when threatening or abusive communication is shown to have had no impact on the litigant concerned, there may still be a contempt. 60 Reference was also made to Timania Pty Ltd v Inghams Enterprises Pty Ltd [2004] FCA 732. That decision was overruled on appeal for a breach of procedural fairness without affecting the statements of principle of contempt below in Inghams Enterprises Pty Ltd v Timania Pty Ltd (2005) 221 ALR 823. 61 In Timania at [23]-[31], Finkelstein J analyses the authorities on conduct calculated to prejudice the due administration justice by interference in a particular case or interference tending to inhibit litigants from seeking access to the courts. Reference was also made to Arlidge Eady & Smith on Contempt (3rd ed), Sweet & Maxwell, London, 2005 at [11-229]-[11-240] on improper pressure. 62 While the categories of contempt are not fixed, the improper pressure cases cover influencing jurors, pressure on parties and threats to witnesses. 63 In this case there was no improper pressure exerted on the plaintiffs, or their witnesses, or the Court. The pressure was directed to the Minister to introduce amending legislation. Messrs Hearne and Tierney were lobbying a member of government to achieve a result. They were successful and the law was changed such that the plaintiffs' rights were adversely affected. That, in my view, did not involve any hindrance to the plaintiffs' access to the courts, any affectation on the Court's ability to give a verdict free from bias against any party and limited to the facts proved in evidence, nor a usurpation of the function of the Court to decide according to law, to analyse the matter in terms of Lord Diplock's speech in Times Newspapers. 64 Mr Alexis SC, who with Ms Sibtain appeared for the plaintiffs, conceded that lobbying a government minister would not constitute a contempt, but doing so by unlawful means would. 65 I fail to see the distinction. It is the nature of the lobbying that must be seen as a matter of practical reality to constitute a tendency to interfere with the course of justice in a particular case, to use the language of Mason P's second proposition in Harkianakis regardless of the lawfulness or unlawfulness of the means used. 66 The successful lobbying resulted in the plaintiffs' resort to the Court being circumvented. But it did so by a change in their legal rights as a matter of law. It played no part in the manner in which the Court could deal with the changed legal rights of the plaintiffs, nor did it exert pressure on the plaintiffs or their witnesses. 67 In my view, the second charges against Messrs Hearne and Tierney are insupportable.

Orders 68 I dismiss the notice of motion and statement of charge against Peter Hearne and order the plaintiffs to pay Mr Hearne's costs. 69 I dismiss the notice of motion and statement of charge against David Tierney and order the plaintiffs to pay Mr Tierney's costs.

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