Seven Network Limited v News Limited [2005] FCA 1630

FEDERAL COURT OF AUSTRALIA

Seven Network Limited v News Limited [2005] FCA 1630

COSTS – unsuccessful application for inspection of documents for which legal professional privilege claimed Federal Court Rules Order 61 rule 3 SEVEN NETWORK LIMITED (ACN 052 816 789) & ANOR v NEWS LIMITED (ACN 007 871 178) & ORS NSD 1223 OF 2002 GRAHAM J 11 NOVEMBER 2005 SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY NSD1223 OF 2002

BETWEEN: SEVEN NETWORK LTD ACN 052 816 789

& ANOR

APPLICANTS

AND: NEWS LTD ACN 007 871 178 & ORS

RESPONDENTS

JUDGE: GRAHAM J

DATE OF ORDER: 11 NOVEMBER 2005

WHERE MADE: SYDNEY

THE COURT ORDERS THAT: 1. The Third, Fifth and Sixth Respondents pay the costs of the Applicants to date of the Notice of Motion filed 17 October 2005 and of the Amended Notice of Motion filed 21 October 2005.

2. Leave be granted to the Applicants to have a bill of costs taxed forthwith.

3. Payment of the costs be effected forthwith notwithstanding that the substantive proceedings have not concluded.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY NSD1223 OF 2002

BETWEEN: SEVEN NETWORK LTD ACN 052 816 789 & ANOR

APPLICANTS

AND: NEWS LTD ACN 007 871 178 & ORS

RESPONDENTS

JUDGE: GRAHAM J

DATE: 11 NOVEMBER 2005

PLACE: SYDNEY

REASONS FOR JUDGMENT

1 The Amended Application which was before the Court on 24, 25, 26 and 28 October 2005 concerned claims by the Applicants in the proceedings that the whole or parts of some 18 documents were privileged from production on the ground of legal professional privilege. 2 The Telstra Respondents who were the Applicants in the motion failed completely in their application for production of the documents or the relevant parts thereof. 3 Notwithstanding such failure, they rightly demonstrated by their action in bringing the application that the documents identified in the application as documents numbered 1 and 2 were not privileged on the basis claimed in the affidavit of Mark Andrew Jarman sworn 1 July 2005 verifying the Applicants' consolidated list of documents. In that affidavit of discovery privilege was claimed for those documents as documents of which Mr Wise was the author. Had that been the case, the Applicants would not have been entitled to claim legal professional privilege in respect of them or any parts of them. As it transpires the affidavit of Mr Jarman sworn on 20 October 2005 revealed that they were documents recording advice of Mr Jarman brought into existence by him and presented to the board of the First Applicant in Mr Wise's name. 4 Furthermore, but for evidence given by Mr Jarman under cross-examination on the hearing of the application, it may well have been that different conclusions would have been reached in respect of the role performed by Mr Jarman post 13 March 2001, given the terms of Mr Wise's email to Mr Stokes and others of 13 March 2001 recording the appointment of Mr Jarman, who was serving as Legal Counsel, New Media and Investments for the Seven group of companies owned by the First Applicant, as Project Manager of Access Issues for C7. 5 It must be remembered that it is for a party claiming legal professional privilege to show that the documents for which the claim is made are privileged. 6 When I delivered my reasons for judgment on 3 November 2005 upon the prayer for relief in paragraph 1 of the Amended Application I invited short written submissions on the costs to date of the Notice of Motion filed 17 October 2005 and of the Amended Notice of Motion filed 21 October 2005. 7 Costs in respect of interlocutory proceedings are covered by Order 61 rule 3 of the Federal Court Rules. The Rules lay down no criteria to determine how costs should be awarded. It is sufficient that such costs lie in the discretion of the Court, which discretion must, of course, be exercised judicially. 8 A Judge ought to be severe in awarding costs when he or she finds that expenses have been incurred through a wrongful suppression of material documents. As a corollary of that a Judge ought to be severe in awarding costs when he or she finds that expenses have been unnecessarily and inappropriately incurred through claims for production of documents for which legal professional privilege has been claimed, which on the face of it are proper claims, in circumstances where a later consideration of the documents supports entirely the validity of such claims. However, this is not, in my opinion, a case warranting such severity. In my opinion it was quite reasonable for the Telstra Respondents to file the Notice of Motion seeking the production of the documents referred to in Schedule 1 to the Notice of Motion when they did. 9 However, I consider that the Applicants, who have been successful, should have an order in respect of their costs to date of the Motion and Amended Motion, a bill of costs should be taxed forthwith and payment of those costs should be effected forthwith notwithstanding that the substantive proceedings have not concluded.