\| CATCHWORDS Practice and procedure ~- subpoena duces tecum - inspection by applicant of documents produced to the Court by stranger to the proceedings - relevance of the documents to the issues raised in the proceedings - rights of a stranger in producing his personal documents - timing of inspection premature - whether Court should look at documents to determine their relevance. JET CORPORATION OF AUSTRALIA PTY. LIMITED (in its capacity as Trustee of the JET CORPORATION AUSTRALIA TRUST) and PETRES PTY. LIMITED (in its own right and in its capacity as Trustee of the Schutt Unit Trust) and OTHERS V. No. G 109 of 1983 Northrop J. Melbourne 3 May 1985 IN THE FEDERAL COURT OF AUSTPALIA ) ) VICTORTA DISTRICT REGISTRY ) V. No. G 109 of 1983 ) ) GENERAL DIVIS [ON BETWEEN : JOT CORPORATION OF AUSTRALIA PTY. LIMITED (in sts capacity as Trustce of the JET CORPORATION AUSTRALTA TRUST) Applicant and PETRES PTY. LIMITED (in 1ts own right and in its caracity as Trustee of the Schutt Unit Trust) and OTHERS Respondents CORAM: NORTHROP J. DATE: 3 MAY 1985 PLACE: MELBOURNE / : EX TEMPORE REASONS FOR JUDGMENT This is the return of a motion taken out by the applicant seeking an order that the applicant have leave to inspect and take coples of the documents) produced to the Court by Mr. Athol Lidgett of Messrs. Simon, Lidgett, Collingwood and Co. pursuant to the subpoena for the production of the said documents dated 27 June 1983. Notice of motion was served. on all the respondents to the application, and there 15 no appearance by any of those respondents to oppose the making of the order sought. Notice of the motion was served on Mr. Athol Lidgett, who has appeared, by counsel, and who has objected to the granting of leave to the agocuments. The objections can be classified as coming one or more of three documents, or some of relevance to any 1ssue that the documents are who is a stranger to stranger in relation protected by the Court; application for postponed until the issues when 1t will be more apparent the Court can sufficient relevance to those issues to justify the applicant to inspect and take copies of inspection decide whether those within separate headings: first, that the them, have no relevance or apparent raised in these proceedings; secondly, the personal documents of Mr. Lidgett, the litigation, and the rights of a to his personal documents should be and thirdly, that in any event, the is premature and should be have been clarified by pleadings as to what are the issues and the documents produced have granting of leave to inspect then. In support of his submissions, counsel relied upon Small's case (1938) S.R. (N.S.W.) 564 and the views expressed by Sir Frederick Jordan in that case in relation to the practice and procedure to be adopted in relation to type cof problem, and also Waind's case (1978) 1 particularly the judgment Appeal, Mr. in accordance with views expressed in should inspect the relevance. ° Justice Moffatt. documents Counsel also this N.S.W.L.R., of the President of the Court of Counsel also urged upon me that that case, the Court to decide any question of relied vpon two affidavits, one by Mr. Hobday sworn 3 May 1985, which refers to the fact that during the course of last year, the solicitors for the applicant notified the solicitors for Mr. Lidgett of the possibility of Supreme Court proceedings being instituted by the applicant ain relation to matters common to matters arising in the present proceedings in this Court and enclosing a copy or statement of claim which would form the basis cf that action in the Supreme Court. In reliance on this, counsel urged that this illustrated the problems arising from the rights of the person producing the documents and the danger of any infringement of those rights where use could be made of documents inspected in those proposed Supreme Court proceedings, and if not direct use made of the documents, information could be obtained which could be used in the framing of the statement of claim, knowing full well that there were documents supporting the allegations made as a result of information obtained from the inspection of documents in this action. The other affidavit was by Mr. Lidgett himself sworn on 24 April 1985, which contained matters in relation to the possible production to the solicitors for the applicant of the documents produced at an earlier stage. T place no reliance upon that matter since 1t seems to me I must decide now whether leave should be given to inspect or not, on the way the matter has been argued and presented to me today. In opposition to the motion, the applicant relies upon an affidavit sworn by the solicitor for the applicant making reference to a report made by Messrs. Simon, Lidgett, Collingwood and Co. and dated 23 September 1981, which report shows that the firm, Messrs. Simon, Lidgett, Collingwood and Co. was then actively engaged in relation to the creation of the new Jet Corporation of Australia Trust for the purposus of taking over and acquiring the business of Schutt Aviation and other matters. A copy of that report 1s annexed to the affidavit, together with a letter which is, on the face of it at least, relevant to the matters which are raised by the statement of claim filed on behalf of the applicant. The affidavit also discloses the fact that 1n the opinion of Mr. Johnson, the solicitor for the applicant, because of the unusual features of this case, it is necessary for the applicant to inspect and take copies of the documents produced to enable it to present its case based on the statement of claim, and he says that it is his belief that the applicant may only be in a position to gain a full understanding of the facts which relate to the whole of the action once it has been afforded the opportunity to inspect and take copies of the documents. It should be noted also that the statement of claim does refer in particluar to three ef its paragraphs to the report referred to in the affidavit annexed to it. It is also necessary to make reference to the documents which have been made the subject of the subpoena, and they are referred to in the Schedule to the subpoena and I quote: "(a) the firm's correspondence file, papers for, calculations prepared for and drafts of its report dated 21st September, 1981 related to the projected business of the firstnamed Applicant TOGETHER WITH documents handed into the possession of the firm in connection with the report. (b) the firm's cotrespondence file and accounting records in connecticn with its professional assistance to The Jet Corporation of Australia Trust relating to the offering of its units, subscription, sales and transfers of units." The firm referred to in the Schedule is the firm of Messrs. Simon, Lidgett, Collingwood and Co. The report 1s exhibited to the affidavit referred to a short while ago, and it also should be noted that the sale and the agreement for sale, arising from the facts rcferred to in that report, form the basis of the application by the applicant. In my opinion, having regard to the statement of claim, the documents referred to in the subpoena and the affidavit of Mr. Johnson, there 15 ample material to support the view that the documents so produced are relevant to the issue raised by the applicant in its statement of claim. In fact, these documents appear to go to the very heart of the complaint made by the applicant and it is necessary, 1n my opinion, in the interests of justice, that the applicant is able to inspect those documents to enable it to present its case to the Court. The question arises whether the Court should, in the exercise of its discretion to grant inspection or not, look at those documents itself to determine whether they are relevant or not. On the facts of this case, and notwithstanding what has been said both in Waind's case and Small's case, it would be inappropriate for the Court, at this stage, to look at those documents to decide the question of relevance. In my opinion, this is not a case of a fishing expedition by the applicant andit is acase where the applicant is proceeding under some difficulties because of the problems of obtaining necessary documentation to support its claim, that documentation being in the custody of other persons. It is also apparent, from the material already referred to, that documents have been produced to the Court and no objection was taken at that time as to the relevance of the documents referred to in the subpoena, nor was any objection then taken as to the form of the subpoena being in the nature of a fishing expedition or discovery against a non party. In all the circumstances, therefore, I think 1t is inappropriate for the Court to inspect the documents first and that this is a case where, from other material and for other reasons, there is sufficient evidence to support the view that the documents produced are relevant and do have an apparent relevance to the issue raised by the applicant, and that on this aspect of the matter the applicant should be granted leave to inspect them. At the same time it is necessary to balance against that right of the applicant, the rights of the person who produced the documents, Mr. Lidgett. The Court must be careful to ensure there is no unnecessary invasion of the rights of that person, the rights of his privacy to his documents, and those rights must be balanced against the rights of ensuring that justice 1s done by the Court in determining rights and liabilities between parties to the action. There is force in what was said by counsel for Mr. Lidgett in relation to the dangers of inspecting documents which could be used elsewhere, but a number of recent decisions in England have clarified the position in relation to documents which are produced in Court proceedings. Harman's case 1 £19831 A.C. 280, a decision of the House of Lords, lays down stringent obligations on professional people and on parties who obtain material in Court proceedings, and the improper use of that material otherwise than in those proceedings constitutes a contempt of Court as being in breach of an undertaking implied by the law not to make improper use of documents produced pursuant to Court procedures. In the more recent case of Sybron Corporation v. Barclays Bank PLC. £19844 3 W.L.R. 1055, similar views were expressed by Mr. Justice Scott in relation to documents produced by way of subpoena. I quote from page 1063 of that report: "It is a rule established by several recent cases, to which I must later refer, that documents disclosed by a party under compulsicn of court process, such as discovery, cannot be used by the party to whom they are thereby disclosed for any umproper purpose. An implied undertaking not toa use the documents for an improper purpose 18s imposed by the court on that party. Breach of that undertaking would represent a contempt of court: see Home Office v. Harman £19833 1 A.C. 280. A party who desires to use such documents for purposes outside those for which they have been disclosed ought first to seek the leave of the court authorising such use: see Baltcon International Inc. v. Shell Transport and Trading Co. £19793 R.P.C. 97." The Sybron Corporation case was a case where documents had been obtained in one proceeding and were sought to be used in other proceedings. The reasoning of the Court was that 1t should not be done without leave of the Court. In my opinion, any document which has been produced pursuant to the subpoena, and which is inspected by the applicant or its solicitor, cannot be used for any other purpose, apart from the purposes of these proceedings, without the leave of the Court. They have been inspected by those persons upon, at the very least, an implied undertaking that improper use will not be made of those documents and that, if it is, the persons who so make improper use will be liable for penalty by way of contempt of Court. In my opinion, this is ample protection to safequard the rights of Mr. Lidgett, even in the extension of the problem suggested by counsel] for Mr. Lidgett, that use could be made of information so obtained in framing other Court proceedings. Accordingly, on a balancing exercise, I need to ensure that the applicant 15 able to properly present its case when weighed against the rights of the person answering the subpoena, Mr. Lidgett, together with the obligation imposed upon the applicants by granting leave to inspect those documents. This weighs in favour of the applicant and, accordingly, on this ground of objection, I find in favour of the applicant. The third main ground for objection by Mr. Lidgett was that the claim for inspection is premature. It is said that the issues are not yet fully clarified; the hearing 15 still very much in the future; that this is a matter that should be deferred until much closer to the time of trial, In my opinion, that submission also should be rejected. For reasons already given, it 1s apparent that this is a most complex and difficult action commenced by the applicant. The applicant is facing difficulties in obtaining the necessary documentation to enable it to frame properly its claim and that to delay further the inspection of documents, which I have held are relevant, to enable inspection to be granted now, could merely add to problems in the future where, after inspection, it may be necessary to - 10 - reframe parts of the statement of claim and parts of the claim itself thereby further delaying the hearing and making more difficult the general presentation of the case. In my opinion, it is important that the inspection takes place as soon as practicable to enable the applicant to frame 1ts case to enable the Court, in due course, to deal with the whole of the application. Accordingly, the Court proposes to make the order sought. The Court gives leave to the applicant to inspect and take copies of the documents produced to the Court by Mr. Athol Lidgett of Messrs. 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