Westsand P/L v Johnson [1999] QSC 337

2. Details of all cash collection records from 1 May 1996 to date* which record details of cash collected from various Post Offices by Westsand Pty Ltd trading as Border Security and delivered to Armaguard hubsites and to Commonwealth Banks.

[*On the hearing of the application counsel for the applicant sought such records only between 1 May 1996 and 5 June 1998.]

3. All records of any meetings, correspondence or notes concerning the amounts of cash being collected and delivered by Westsand Pty Ltd trading as Border Security.

[4] The respondent's solicitor took the point that the notice had been served on the respondent before it was served on other persons affected by it, and that the names and addresses of such other persons were not written on the notice or any copies of it. So far as relevant the rules provide:-

"243(2) However, the applicant may serve the respondent only after the applicant has served all other persons who are required to be served under rule 244.

244(1) The applicant must, within 3 months after the issue of a notice of non-party disclosure, serve a copy of the notice on -

(a) a person, other than a party, about whom information is sought by the notice; and

244(5) The applicant must write the name and address of anyone who must be served under this rule on the notice and on all copies of the notice.

245(1) ... a person who has been served with a notice of non-party disclosure under rule 244, may object to the production of some or all of the documents mentioned in the notice within 7 days after its service or, with the court's leave, a later time."

[5] The respondent's solicitor submitted that the notice ought to have been served on Stephen Ganter, Armaguard and the Commonwealth Bank. I accept that they are persons about whom information is sought. In fact they were served with copies of the notice on 20 October 1999 in the case of Ganter and on 22 October 1999 in the cases of Armaguard and the Commonwealth Bank. In an affidavit sworn on 2 November 1999 the applicant's solicitor deposed to not having received notice of objection from any of such persons.

[6] The failure to serve these persons before service on the respondent is in the circumstances an irregularity within r 371. I declare that service on the respondent Australia Post was effectual despite non-compliance within r 243(2).

[7] The substantial objection to production of the documents was on the ground of relevance. Rule 242(1) provides:

"A party (the `applicant') to a proceeding may by notice of non-party disclosure require a person who is not party to the proceeding (the `respondent') to produce to the applicant, within 14 days after service of the notice on the respondent, a document -

(a) directly relevant to an allegation in issue in the pleadings; and

(b) in the possession or under the control of the respondent; and

(c) that is a document the respondent could be required to at the

The test is direct relevance, as it is in disclosure inter partes (r 211); i.e. whether a document would tend to prove or disprove an allegation in issue on the pleadings. This is in contrast to the train of inquiry test which applied in discovery inter partes until 1994: The Campagnie Financiere et Commerciale Du Pacifique v The Peruvian Guano Company (1882) QBD 55.

(b) state the allegation in issue in the pleadings about which the document sought is directly relevant."

This is a recognition that non-party disclosure is an imposition on a stranger to litigation. In the usual case the respondent will have no knowledge of the proceedings and will not have copies of the pleadings; it should not be expected to have to call for these and analyse them.

[9] In the present case the following allegation is set out in the notice as being the one to which the documents are relevant:-

"1. That the Plaintiff issued a `running sheet' to the Defendant on 5 June 1998 requiring the defendant to collect and carry cash from various clients in an unarmoured car which the Plaintiff knew, or ought to have known, would require the Defendant to carry cash exceeding $75,000.00."

(Paragraph 7(a) of the Amended Defence which is exhibit C to the affidavit of Delany filed on 14 October 1999.)

[10] I accept the submissions of the respondent's solicitor that none of the documents described in the notice has direct relevance to this allegation.

[11] The applicant's counsel submitted nevertheless that the documents were of direct relevance to a number of other allegations in the pleadings. It is the clear intent of rr. 242-249 to minimise the imposition of non-party disclosure on a stranger to litigation. Accordingly, a party in the position in which the present applicant finds himself ought not ordinarily to be allowed to seek to uphold the notice by assertion of direct relevance to other allegations in the pleadings. The circumstances of the present application are somewhat unusual. From correspondence in evidence it seems that the respondent has had solicitors acting for it in relation to non-party disclosure since at least June 1999; indeed it may even have been served with an earlier notice of non-party disclosure. Those solicitors are fully acquainted with the pleadings. It is the duty of the court to avoid undue delay, expense and technicality (r 5(3)). In the special circumstances of this application I am prepared to consider the other allegations to which the documents are submitted to be directly relevant.

[12] The plaintiff entered into a subcontract with Armaguard for the collection of money. There was a further subcontract to the defendant. A robbery occurred while the defendant was collecting money from the Mudgeeraba Post Office in the performance of its duties. Approximately $270,000 was stolen. There is a dispute between the plaintiff and the defendant as to whether the defendant was permitted to carry more than $75,000 in cash in an unarmoured vehicle. The allegations to which the documents are submitted to have direct relevance are as follows:-

(b) was in the business of transporting cash for clients for reward;

2. In or about June, 1996 the plaintiff and the defendant entered into an oral agreement whereby the defendant was subcontracted, or alternatively was engaged in a contract of service, to perform for reward some of the transporting of cash that the plaintiff was engaged to perform by its clients.

3. The oral agreement between the plaintiff and the defendant included the following express terms:-

(a) the defendant was to collect and transport the cash at the direction of the plaintiff and deliver it to the plaintiff or whomever or wherever the plaintiff might direct;

(b) the defendant was to transport no more than $75,00.00 in cash if he was using an unarmoured vehicle;

4. On 3 June 1998 [sic] the defendant, pursuant to the agreement pleaded above, was collecting cash from the plaintiff's clients and transporting it in an unarmoured vehicle.

6. Part way through the defendant collecting and transporting the cash for the plaintiff's clients on 3 June 1988 [sic] the unarmoured vehicle he was using went missing, together with the cash, and the cash has been lost as a result.

The defendant was in the Mudgeeraba Post Office collecting cash at the times at which the vehicle (which was parked) went missing. At the time the defendant had in the car cash of the plaintiff's clients totalling $266,700.00."

**"**3. With respect to paragraph 2 of the Statement of Claim the Defendant says that:-

(a) In or about May 1996 the Plaintiff and the Defendant entered into an oral agreement in New South Wales whereby the Defendant was engaged in a contract of employment to perform various jobs including transporting of cash that the Plaintiff was engaged to perform by its clients;

4. With respect to paragraph 4 of the Statement of Claim the

(a) On 5 June 1998 the Defendant, pursuant to his contract of employment was collecting cash from the Plaintiff's clients and transporting it in an unarmoured vehicle.

5. There were implied terms of the contract of employment

entered into between the Plaintiff and the Defendant that:-

(a) The Plaintiff would obtain a policy of insurance indemnifying itself, to the extent of the policy's limit, from any claim from any of its customers or from any loss sustained by it due to, inter alia, the loss of cash carried by the Defendant in performing his contract of service:

(b) The Plaintiff would maintain the enforceability of the said contract of insurance by not breaching its terms or otherwise losing its right to such indemnity;

(c) The Plaintiff would not cause, inter alia, cash to be carried in an amount which would not be indemnified pursuant to the contract of insurance.

(d) The Plaintiff would indemnify the Defendant from any claim for loss arising out of the transport of cash.

11. Further and in the alternative, if there were express terms of the contract as pleaded in paragraphs 3(b) and 3(c) of the Statement of Claim, which are denied, then terms were waived by the Plaintiff.

(a) Providing running sheets to the Defendant which subsequent to 23 December 1996 required the picking up and delivery of moneys in an unarmoured car which regularly exceeded the sum of $75,000.00

(b) Failing to provide any system of work or means available by which the Defendant was able to off load moneys in excess of $75,000.00 to other employees and/or agents of the Plaintiff."

[13] I accept that the contract between Australia Post and Ganter and/or Westsand Pty Ltd trading as Border Security has direct relevance to the allegations in paragraphs 4 and 6 of the Statement of Claim and paragraph 4(a) of the Amended Defence. I do not consider that any of the documents referred to as numbers 2 and 3 in the schedule in the notice of non-party disclosure is directly relevant to any of those allegations. To order their production would be to sanction a fishing expedition, which would be outside the scope of the relevant rules.

[14] One of the grounds upon which objection was taken was the confidential nature of the documents (r 245(4)(e)). In oral submissions the plaintiff's solicitor said:-

"Any document that deals with arrangements regarding the collection of cash ought to be one which is not bandied around except where it's expressly required to be given to a party or to somebody with legitimate and reasonable reason to have a look at it."

A party gaining access to a document pursuant to a notice of non-party disclosure is subject to an implied undertaking not to use it except for the purpose of the litigation. (Consider Central Queensland Cement Pty Ltd v Hardy [1989] 2 Qd R 509, a case concerned with discovery inter partes.) In the circumstances I would not refuse an order for production on the basis of a confidential nature of the contract.

[15] Another point taken by the respondent was that the applicant had available to it other reasonably simple and inexpensive ways of proving the matter sought to be proved by the documents: r 242(2).

[16] So far as the contract is concerned, the applicant has sought production from the plaintiff. In a letter dated 9 September 1999 the plaintiff's solicitors asserted that the contract was not directly relevant to the issues on the pleadings and went on to say that their client did not believe he had a copy of it. It was submitted that I should refuse to order production because the defendant has not first exhausted his rights against the plaintiff pursuant to r 223(2). Not without some hesitation, I have concluded that it would be proper to order production since it seems unlikely that the plaintiff will be able to produce the contract. Were it simply a question of direct relevance to the allegation set out in the notice (that of the issue of a running sheet) I would consider that service of a notice to admit facts (r 189) was a practicable alternative to non-party disclosure, and I would not be inclined to order production by the respondent until that avenue had been explored and found not fruitful. However, because I have concluded that it is directly relevant to other allegations in issue on the pleadings, I would not refuse relief for that reason.

[17] It was further submitted by the respondent's solicitor that the description of the documents was too wide and lacking in particularity (r 245(4)(c)). It is pertinent to begin by considering r 242(1)(c) which provides for a notice of non-party disclosure of a document -

"(c) that is a document the respondent could be required to produce at the trial of the matter."

By r 415(2)(c) a subpoena for production may be set aside on the ground of oppressiveness. In my view the contract which is document 1 has been adequately described, but the description of the other documents is too wide and lacking in particularity, and to order their production would be oppressive.

[18] Thus, I consider that the appropriate orders are as follows -

(1) a declaration that service on the respondent Australia Post was effectual despite non-compliance with r 243(2);

(2) an order that the respondent produce the contract which is document 1 in the schedule to the notice;

(3) an order that the notice be set aside insofar as it relates to documents 2 and 3 in that schedule.

[19] So far as costs are concerned, r 247(3) and (4) provides:-

"(3) Unless the court otherwise orders, each party to an application to decide an objection must bear the party's own costs of the application.

(4) The court may make an order for subrule (3) if, having regard to the following, the court considers that the circumstances justify it-

(b) the public interest in the efficient and informed conduct of litigation;

(c) the public interest in not discouraging objections in good faith by those not a party to the litigation."

The applicant and the respondent have each had partial success in this matter. Some of the objections to production were technical. On the other hand it was only because of the apparent history of the matter that I was prepared to consider the question of relevance to allegations other than that set out in the notice. In all the circumstances I consider it appropriate that each party bear its own costs of the application.