DISCRETION
19 While the Court may have the power to order a party to produce documents for the purposes of a mediation, even when those documents would not be otherwise discoverable as they are not relevant to the determination of any issue in dispute in the proceeding, in my view that is a discretionary power that should be exercised with a degree of circumspection and caution. That is because, while the Court may compel parties to attend a mediation, mediation is a procedure which is essentially consensual. While the process is guided by the mediator, it ultimately relies on the good faith of the parties and the employment of commercial common sense. The Court should accordingly be reluctant to compel a party to produce documents for the purposes of a mediation, particularly commercially confidential documents which the party is reluctant to disclose. As Perry J put it in Beneficial Finance Corporation v Price Waterhouse (1996) 68 SASR 19 at 35:
Mediation is an entirely different procedure from the trial of an action at law. While mediation may be mandated, nonetheless it is essentially a consensual procedure. It would be contrary to the proper disposal of pretrial procedures relating to proceedings in the civil jurisdiction of the court (as opposed to mediation) to confuse those procedures by taking steps which might be thought desirable if there was to be a mediation.
20 And as Lander J said, in the same case (at 58), the "matters of alternative dispute resolution or mediation are not good reasons to override a party's right to keep its commercial documents or any of its documents confidential".
21 It is true that, like Centro and Evans, Beneficial Finance concerned the production of insurance documents. In my view, however, the observations of both Perry J and Lander J apply equally to an application for the production of other commercial documents, not otherwise discoverable, for the purposes of a mediation.
22 The Court should be even more reluctant to exercise its discretion to compel the production of documents for the purpose of a mediation where that would "confer an asymmetric commercial advantage in favour of one party at the expense of another", or "give rise to asymmetric bargaining positions": cf Evans at [4] and [73]. That is generally likely to be the case where one party seeks to compel another party to produce insurance documents. That is not, however, the only category of commercial documents the production of which may give rise to asymmetric bargaining positions.
23 It may be readily accepted that the documents sought by Owners, being documents that includes the square metreage data, are sought for a bona fide purpose associated with the upcoming mediation. If offers to settle the entirety of the representative proceeding are made in the course of the mediation, Owners will no doubt have to assess whether those offers represent a reasonable compromise for the group members as a whole having regard, among other things, to Owners' best estimate of the overall losses which are potentially recoverable by group members. That assessment may be difficult given that Owners cannot be absolutely certain that the 214 persons or entities who have registered their intention to participate in the proceeding to date necessarily comprise the entirety of the group members who may ultimately seek to participate in any settlement, or seek to recover an amount from any settlement sum. I have no doubt that Owners believes that the documents it seeks from Halifax will enable it to better estimate the overall losses suffered by group members.
24 There are, however, a number of considerations which weigh against the Court exercising its discretion to compel Halifex to produce the documents in question.
25 First, there appear to be sound reasons for doubting that the documents will in fact provide a reliable estimate of the overall recoverable damage suffered by group members. There is no reason to doubt Mr Rose's information and belief evidence to that effect. In particular, the square metreage data that Halifax may be able to extract from its record keeping system would likely include Alucobond product that was not ultimately used as part of a façade, or was not otherwise affixed to group members' buildings. It would also include offcuts and discarded material. Moreover, not all of the Alucobond product affixed to group members' buildings may ultimately need to be removed, even if the product is relevantly found to be not fit for use as a façade. Much will depend on precisely where and for what reason it was affixed to the building.
26 Second, and relatedly, there are sound reasons for suspecting that the documents including the square metreage data sought by Owners would, if produced, lead Owners to overestimate the overall group member losses, even if discounted as suggested by Mr Petrovski in his evidence. That would, in a sense, give rise to asymmetric bargaining positions. It would potentially give Owners a basis upon which to propose a larger overall settlement sum based on the square metreage data. As noted earlier, I accept that Owners' application is bona fide and that it does not seek to obtain a commercial advantage or advantageous bargaining position. The conferral of such an advantage may well, however, be the effective result if the documents may in fact materially overestimate likely group member losses.
27 Third, given Halifax's opposition to the production of the documents and its belief, on apparently reasonable grounds, that the square metreage data would lead owners to significantly overestimate overall group members losses, it is somewhat doubtful that production would in any way facilitate the mediation or increase the likelihood of settlement. Halifax would almost inevitably reject, or at least view with considerable scepticism, any offer formulated on the basis of an estimate of losses derived from the square metreage data.
28 Fourth, Owners has known the identity of at least 214 group members, or potential group members, for some considerable time. It is likely to possess some information in respect of the claims of those group members, including their likely or possible losses. At the very least, it has been in a position to itself obtain information from those group members concerning the amount of Alucobond product that was used on their buildings. It may be inferred that Owners is able to arrive at a reasonable estimate of the losses allegedly suffered by the registered group members.
29 Owners' application for the production of the square metreage data from Halifax appears to have been driven by the belief that there are many more group members than the 214 that have registered their interest or intent thus far. It is, however, far from clear whether there is a reasonable basis for that belief, particularly given the extensive distribution of notices that has occurred to date. Owners' belief that there must be more group members than the 214 persons or entities that have thus far registered their interest in participating in the proceeding appears to stem from its belief that some of the documents that were discovered by Halifax recorded the supply of large quantities of Alucobond panels by its façade business. Halifax maintains, however, that the global figures in those documents do not provide a reliable basis for estimating group member claims. And the fact remains that, despite the extensive distribution of Court approved notices, including notices requesting potential group members to make themselves known for the purposes of the mediation, only 214 persons or entities have registered their interest thus far. Owners has not revealed whether it has any actual or concrete knowledge of the existence of any other group members.
30 Fifth, Owners' application for production was made very late, relatively speaking. The application was first foreshadowed to Halifax on 9 December 2022 and first raised before the Court, effectively without notice, at a case management hearing on 12 December 2022. The Court heard the application as soon as it was able to. Owners provided no reasonable explanation for why the application was made at such a late stage, given that they had known for some time that the mediation would take place in late March 2023.
31 Sixth, the production by Halifax of the documents sought by Owners would by no means be a straightforward exercise. The documents sought by Owners do not presently exist, but would need to be produced by the manipulation of data within Halifax's record keeping system. The evidence suggests that that data is not readily accessible and that Halifax would need to retain information technology consultants to assist it. A "separate manual or formulated calculation" would also be required. While perhaps not a weighty consideration in all the circumstances, the trouble and expense that would be incurred by Halifax in meeting any production order should not be ignored, particularly given the lateness of the Owners' application.
32 It is obviously the case that the more information that parties to a mediation are able to exchange concerning their respective cases, the better the prospects of a successful mediated outcome. Parties should be encouraged by the Court to consensually exchange information to that would facilitate the mediation and enhance any settlement negotiations that may occur at it. In the present case, the parties should be encouraged to exchange information which would enable or facilitate the estimation of overall group member losses should Owners' allegations concerning the suitability of the Alucobond products be found to be made out. In particular, once Halifax is made aware of the identity of all 214 group members and their buildings, it should consider making available to Owners such square metreage data as it is able to retrieve in respect of those buildings. The Court would consider making confidentiality orders in respect of that data if needs be.
33 For the reasons that have already been given, however, the Court should not compel Halifax, against its wishes, to produce the global square metreage data in the terms of the order sought by Owners. It is doubtful that that data as sought would provide any reasonable or reliable basis for estimating overall group member losses. Rather, production of the data may result in an overestimation of the value of group members' claims and thereby may give rise to asymmetric bargaining positions. That is hardly likely to facilitate the mediation.
34 I am not persuaded, in all the circumstances, that this is an appropriate case for the Court to order Halifax to produce the documents sought by Owners for the purposes of the upcoming mediation. Owners' application must accordingly be dismissed with costs.
I certify that the preceding thirty-four (34) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Wigney.