FEDERAL COURT OF AUSTRALIA Armit v Jeminex Limited [2011] FCA 990 Citation: Armit v Jeminex Limited [2011] FCA 990 Parties: MADONNA ANNE ARMIT v JEMINEX LIMITED File number: NSD 1744 of 2010 Judge: ROBERTSON J Date of judgment: 22 August 2011 Corrigendum: 30 August 2011 Catchwords: PRACTICE AND PROCEDURE – Discovery – proceedings under Competition and Consumer Act 2010 (Cth) and for negligent misrepresentation, breach of contract and under the Contracts Review Act 1980 (NSW) – parties' categories of discovery disputed – claim that categories too broad – claim for legal professional privilege – various categories accepted, amended and rejected as insufficiently related to the issues between the parties on the pleadings Legislation: Competition and Consumer Act 2010 (Cth) Contracts Review Act 1980 (NSW) Trade Practices Act 1974 (Cth) Cases cited: Austral Dutch Kaolin Pty Ltd v Hanjin P&C Co Ltd [2011] FCA 638 distinguished Date of hearing: 22 August 2011 Place: Sydney Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 65 Solicitor for the Applicant: Mr G Adelstein of Diamond Conway Lawyers Counsel for the Respondent: Ms N Bearup Solicitor for the Respondent: Sachs Gerace Lawyers FEDERAL COURT OF AUSTRALIA Armit v Jeminex Limited [2011] FCA 990 CORRIGENDUM 1. In paragraph 64 of the Reasons for Judgment, in the last sentence at line 5, the word "be" should be omitted. 2. In paragraph 65 of the Reasons for Judgment, in the first sentence at line 1, the word "the" should be inserted between "to" and "costs". I certify that the preceding two (2) numbered paragraphs are a true copy of the Corrigendum to the Reasons for Judgment herein of the Honourable Justice Robertson Associate: Dated: 30 August 2011 IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1744 of 2010 BETWEEN: MADONNA ANNE ARMIT Applicant AND: JEMINEX LIMITED Respondent JUDGE: ROBERTSON J DATE OF ORDER: 22 AUGUST 2011 WHERE MADE: SYDNEY THE COURT ORDERS THAT: On or before 4 October 2011, the respondent give discovery to the applicant of the following categories of documents: 1. All documents brought into existence on or before 31 March 2008 recording or evidencing the acquisition of the ISAS business, including but not limited to: – (i) The sales or acquisition agreements referred to in paragraph 16 of the Statement of Claim; (ii) . . . (iii) Documents recording the negotiations in respect of the applicant's sale of shares in ISAS to the respondent, including any terms and conditions of the ISAS acquisition or sale of business; (iv) . . . (v) . . . . 2. Any document evidencing or recording any of the alleged representations which are in issue on the pleadings. 3. All documents recording or evidencing: – (i) . . . (ii) The employment contract with the applicant; (iii) . . . (iv) . . . 4. All documents recording or evidencing communications in respect of Firesistex, Quantum Guard or other products in development by ISAS in the period 14 March 2008 through to 2 April 2009. 5. All documents recording or evidencing the performance of the ISAS business in the period between 14 March 2008 and 2 April 2009. 6. All prospectuses, advertising or marketing material prepared in the period 14 March 2008 to 2 April 2009 in relation to: – (i) . . . (ii) . . . (iii) ISAS; (iv) . . . (v) . . . (vi) . . . (vii) Firesistex; (viii) Quantum Guard; (ix) . . . 7. All documents prepared by Jeminex relating to proposed ISAS sales and marketing strategy for the period between 1 January 2007 and 2 April 2009. 8. . . . . 9. . . . 10. All documents recording or evidencing any management appraisal, HR assessment, disciplinary action, warning, notices, reprimands or termination notifications taken in respect of the applicant during her employment by the respondent. 11. All documents recording or evidencing the respondent's marketing of the ISAS products for the period 14 March 2008 to 2 April 2009. 12. All documents recording or evidencing the respondent's control or ownership of offshore factories for the production of fire retardant apparel for the period 1 June 2007 to 2 April 2009. 13. All documents referring to ISAS on the respondent's websites, including but not limited to the Worksense, Heatley or Beaver websites, in the period 14 March 2008 to 2 April 2009. 14. All documents recording or evidencing any assistance provided by the respondent to the applicant in integrating ISAS products into the respondent's sales distribution and marketing or product development programs in the period 14 March 2008 to 2 April 2009. 15. All documents recording or evidencing the development, manufacture, marketing and sale of Fire Protected Apparel products within the Jeminex Group, other than the ISAS product, in the period 14 March 2008 to 2 April 2009. 16. . . . 17. . . . 18. . . . . 19. All documents recording consideration by the respondent of the capital that was to be made available to assist with the ISAS business in the period 1 January 2008 to 30 April 2009. 20. All documents recording or evidencing the termination or proposed termination of the applicant's employment as ISAS Business Manager with the respondent. 21. . . . 22. All documents recording or evidencing the due diligence undertaken by the respondent prior to entering into the ISAS Sale Acquisition Agreement for the period 1 January 2007 to 14 March 2008. 23. . . . On or before 4 October 2011, the applicant give discovery to the respondent of the following categories of documents: (a) all documents showing product sales made by Industrial Safety Apparel Solutions Pty Ltd ("ISAS") between 30 January 2005 and 14 March 2008, including the terms of those sales; (b) all documents evidencing each of the actual or proposed transactions in the Sales Forecast provided by the applicant to the respondent in an email sent by the applicant to Mr Kevin Jacobsen at 11.26 am on 20 January 2008, and in particular all documents evidencing or containing: (i) the actual or proposed transactions included in the Sales Forecast and relating to the Status provided for each of these transactions; and (ii) all communications between ISAS and each of the parties to the proposed transactions in the Sales Forecast and concerning each of the actual or proposed transactions referred to and its Status. (c) all documents showing how the projected sales of $2.8m referred to in the Sales Forecast were to be achieved; (d) the negotiations between ISAS and the respondent in respect of the applicant's sale of shares in ISAS to the respondent, and in particular any document evidencing or recording any of the alleged representations which are in issue on the pleadings; (e) the advice received by the applicant concerning the sale of the applicant's shares in ISAS to the respondent, the share acquisition agreement and the applicant's entitlement to rely on any alleged representation made in connection with the sale of the applicant's shares in ISAS to the respondent which are in issue on the pleadings; (f) the applicant's assessment for the period 1 June 2007 to 31 March 2008 of how ISAS' financial position would be affected by the respondent's acquisition of the applicant's ISAS shares and the applicant's forecast of ISAS' financial position; (g) for the period 1 June 2007 to 31 March 2008, documents containing or recording the applicant's consideration of the earn out budget and how it might be achieved; (h) the applicant's alleged expectations regarding the customers that ISAS would retain or acquire; the contracts that would be entered into with them; the sales that would be achieved and the products that would be developed following the acquisition of the applicant's ISAS shares and in particular all documents containing or recording the applicant's expectations referred to above and the lack of fulfilment of those expectations; (i) any document showing the applicant's expectations as to the distribution, marketing, manufacturing plant and supply chain that would be available to ISAS in the Post Acquisition Period, and any document containing or recording the non-fulfilment of those expectations; (j) any document showing the applicant's expectations as to the information technology that would be available to ISAS in the Post Acquisition Period, and any document containing or recording the non-fulfilment of those expectations; (k) any document showing the applicant's expectations as to access to the services of Mr van Buiten that would be available to ISAS in the Post Acquisition Period, and any document recording or containing the non-fulfilment of those expectations. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1744 of 2010 BETWEEN: MADONNA ANNE ARMIT Applicant AND: JEMINEX LIMITED Respondent JUDGE: ROBERTSON J DATE: 22 AUGUST 2011 PLACE: SYDNEY REASONS FOR JUDGMENT 1 The present applications concern discovery. Although there does not appear to be any formal interlocutory application before me, I shall treat the hearing today as an application on the part of the applicant for discovery in the categories listed in the document dated 1 June 2011 in 23 categories, plus sub-categories, and so far as the respondent is concerned the notice for discovery in the eleven categories of which notice dated 1 June 2011 was given to the applicant. 2 The substantive proceedings include a claim under s 52 of the Trade Practices Act 1974 (Cth) [see now s 18(1) of Schedule 2 to the Competition and Consumer Act 2010 (Cth)] in relation to the sale by way of share acquisition of a business conducted by the applicant, Industrial Safety Apparel Solutions Pty Ltd ("ISAS"), to the respondent. At the heart of that case is conduct constituted by representations alleged to have been made by the respondent. 3 There is also a negligent misrepresentation claim. 4 There is a reference to the Contracts Review Act 1980 (NSW). 5 The applicant was the sole shareholder and sole director of ISAS. 6 On or about 14 March 2008 there was a written Share Acquisition Agreement and an Employment Contract between the applicant and/or ISAS and the respondent. Under the employment contract the applicant was to be the business manager of ISAS. 7 The case also seems to involve breach of the Share Acquisition Agreement, causing loss and damage, and breach and repudiation of the Employment Contract, also causing loss and damage. These matters do not seem to be mentioned as such in the application as opposed to the statement of claim. 8 It is common ground that the applicant's employment as business manager of ISAS was terminated in early April 2009. 9 In my view the key to the resolution of the dispute about the categories of discovery lies in identifying the pleaded issues. Contrary to the applicant's general approach, discovery questions do not proceed by reference to topics or to subject matters except to the extent that those matters arise as issues between the parties on the pleadings. 10 It is significant that no evidence has been filed going to either relevance, for example what an expert has asked for, or going to any difficulty on either side searching for or identifying any documents. So I do not proceed by reference to any claims of oppression or other difficulty of that nature. 11 The pleadings seem to me at the moment to be unnecessarily diffuse in that they do not take the form, as might be expected, of pleading the representations and then a corresponding pleading of a breach of those representations in the same terms. 12 Nevertheless, on the pleadings there are the following main areas of dispute: (i) the scope of business of ISAS before 14 March 2008, including its products; (ii) the terms of statements made in the course of negotiations between the parties in early December 2007. (iii) whether those statements ("representations") were correct; (iv) loss and damages. 13 The Federal Court Rules and what is now Practice Note CM5 guide the resolution of the applications. I apply as criteria to guide the exercise of my discretion whether the making of the order sought will facilitate the just resolution of the proceeding as quickly, inexpensively and efficiently as possible. 14 Another related issue is whether the documents are directly relevant to the issues raised by the pleadings or in the affidavits and whether: (a) the documents are those on which the party intends to rely; (b) the documents adversely affect the party's own case; (c) the documents support another party's case; (d) the documents adversely affect another party's case. 15 I refer to paragraphs 2, 3 and 4 of the Practice Note, especially to paragraph 3, which says: 3. In determining whether to make any order for discovery, the Court will have regard to the issues in the case and the order in which they are likely to be resolved, the resources and circumstances of the parties, the likely benefit of discovery and the likely cost of discovery and whether that cost is proportionate to the nature and complexity of the proceeding. 16 I turn now to the categories sought on each side, first by the applicant. 17 The applicant served a notice of discovery dated 1 June 2011. 18 The categories and my rulings are as follows: 1. All documents brought into existence on or before 31 March 2008 recording, or evidencing or referring to the acquisition of the ISAS business, including but not limited to: – (i) The sales or acquisition agreements referred to in paragraph 16 of the statement of claim; (ii) Draft copies of the sales or acquisition contracts; (iii) Documents recording the negotiations in respect of the applicant's sale of shares in ISAS to the respondent, including any terms and conditions of the ISAS acquisition or sale of business; (iv) Relating to the nature and scope of the assets to be included in the business sale or acquisition; and (v) Any presentation to the respondent's Board of Directors or Management from either Mark Allison and/or Kevin Jacobsen. 19 Subject to the marked deletions the remainder of this category appears sufficiently relevant and I order discovery in those terms. 2. All documents recording, evidencing or referring to any communications between the applicant and: – (a) Kevin Jacobsen; (b) Mark Allison; (c) Arie van Buiten; (d) John Smith; (e) Laila Kara; (f) Neil Gadd; (g) Chris Hay; (h) Phil Torrens; (i) Alan Burt; (j) Gino Calvisi; (k) Inspire IT Staff; in relation to the period 1 July 2007 to 30 June 2009 (" the period") in respect of: – (a) Madonna Anne Armit; (b) ISAS; (c) Firesistex; (d) Quantum Guard; (e) All factories in China in which the Respondent had a controlling interest, or dealt with in the period; (f) Noble Agencies; (g) Woodside Petroleum; (h) Worksense; (i) Beaver Brands; (j) Heatley Industrial; (k) The Farmeca Factory; or (l) The Frontier Factory. 20 This category seems to me to be too wide. I see no reason however why the respondent should not be required to discover: Any document evidencing or recording any of the alleged representations which are in issue on the pleadings; and I so order. 21 As to the post representation period, merely because a person or subject-matter is mentioned in the pleadings does not make every communication with him or her or about it relevant. Indeed so much is recognised in paragraph 3.4 of the applicant's written submissions where it is said that some documents are directly relevant to the dispute, "but which may not strictly come within the matters set out in the pleadings." 3. All documents recording, or evidencing or referring to: – (i) The Share Acquisition Agreement; (ii) The employment contract with the applicant; (iii) All projections, budgets, financial analysis, investigations, due diligence, financial forecasts and financial and legal audits in respect of: – (a) ISAS; (b) Noble Workwear; (c) Worksense; (d) Madonna Anne Armit; (e) Jeminex Limited; and (f) Jeminex Group; in relation to the period 1 July 2007 to 30 June 2009. (iv) Any dealings or transactions with either or both of the Fameca Factory and Frontier Factory, China. 22 As to category 3, I note that subparagraph (i) is not pressed in light of category 1(a). Sub-category (ii) is relevant. Sub-category (iii) and (iv) are, in my view, too wide, that is, insufficiently related to the issues on the pleadings. I do not order discovery in those terms. 4. All documents recording, or evidencing or referring to any communications between the respondent, its employees or officers and: – (a) Ergon Energy; (b) Noble Work Wear; (c) Woodside Petroleum; (d) Worksense; (e) Beaver Brands; (f) Heatley Industrial; (h) Fameca Factory; (i) Frontier Factory; and (j) Frontier Brand; in respect of Firesistex, Quantum Guard or other products in development by ISAS in the period 14 March 2008 through to 2 April 2009. 23 As to category 4, the respondent has indicated a willingness to accept a narrower class, in the sense that the respondent invited the applicant to amend to limit this category. 24 I order discovery in these terms for 4: All documents recording or evidencing communications in respect of Firesistex, Quantum Guard or other products in development by ISAS in the period 14 March 2008 to 2 April 2009. 25 Turning to category 5: 5. All documents recording, or evidencing or referring to any assessments, calculations and/or opinions, and the basis of those opinions in relation to the value performance of the ISAS business and its performance in the period between 14 March 2008 to 2 April 2009. 26 This category as amended by me is sufficiently relevant and I order discovery in those terms. 6. All prospectuses, advertising or marketing material prepared in the period 14 March 2008 to 2 April 2009 in relation to: – (i) Jeminex Limited; (ii) The Jeminex Group; (iii) ISAS; (iv) Noble Work Wear; (v) Beaver Brands; (vi) Worksense; (vii) Firesistex; and (vii) Quantum Guard; and (ix) Heatley Industrial. 27 Subcategories (iii), (vii) and (viii) are agreed and I order discovery in those terms. As to the balance, their relevance has not been established and I do not order discovery of those subcategories. 7. All documents recording, evidencing or referring to or prepared by Jeminex relating to proposed ISAS sales and marketing strategy for the period between 1 January 2007 and 2 April 2009. 28 With the marked words struck through this category is agreed to and I order that discovery be given in those terms. 8. All documents recording, evidencing or referring to procurement contracts for Fire Protective Apparel in respect of the following: – (a) ISAS; (b) Noble Work Wear; (c) Worksense; (d) Heatley Industrial; (e) Beaver Brands; and (f) Frontier Brand; for the period 14 March 2008 to 2 April 2009. 29 This category seems to overlap substantially with category 15 and it has not been established why the further documents in this category are relevant. I do not order discovery in this category. 9. All documents recording, or evidencing or referring to any reports, draft reports, file notes, or working papers prepared by the respondent, its employees or its officers in relation to: – (a) ISAS cashflow; (b) ISAS budget; (c) ISAS earn out budget; (d) ISAS forecasts for sales, revenue and expenses; (e) ISAS annual, half yearly and quarterly profit and loss statements; (f) ISAS balance sheets; (g) ISAS business plans; (h) ISAS growth projections; and (i) ISAS profit distributions; for the benefit of the respondent in relation to the ISAS business for the period 14 March 2008 to 2 April 2009. 30 In my view, little attempt has been made to tie or limit these subcategories to the issues which arise on the pleadings, so I would not order discovery in those terms. I note that as amended and as ordered category 5 covers a large part of this material. 10. All documents recording, or evidencing or referring to any management appraisal, HR assessment, disciplinary action, warning, notices, reprimands or termination notifications taken in respect of the applicant during her employment by the respondent. 31 As amended by me, this category appears sufficiently relevant to the dispute as to termination so I direct discovery in those terms as amended. 11. All documents recording, or evidencing or referring to the respondent's distribution channels, manufacturing plant or supply chains marketing of the ISAS products for the period 14 March 2008 to 2 April 2009 in respect of: – (a) ISAS products; (b) ISAS production costs; (c) ISAS sales figures; and (d) ISAS profit margins. 32 As to category 11, again this is a category where the respondent indicated a willingness to accept a narrower class and invited the applicant to amend. I order discovery in relation to category 11 as amended by me. 12. All documents recording, or evidencing or referring to the respondent's dealings, control or ownership with of offshore factories for the production of fire retardant apparel for the period 1 June 2007 to 2 April 2009. 33 Category 12 is in the same class, that is, the respondent indicated a willingness to accept a narrower class and invited the applicant to amend. I order discovery in this category as amended by me. 13. All documents recording, evidencing or referring to or mentioning ISAS on the respondent's websites, including but not limited to the Worksense, Heatley or Beaver websites, in the period 14 March 2008 to 2 April 2009. 34 This category is agreed but I order discovery in those terms only with the words I have struck through and with punctuation to make it clear that the time period qualifies the whole. 14. All documents recording or , evidencing or referring to any assistance provided by the respondent to the applicant in integrating ISAS products into the Respondent's sales distribution and marketing or product development programs in the period 14 March 2008 to 2 April 2009. 35 This category is agreed but I order discovery in those terms with the words I have struck through. 15. All documents recording or , evidencing or referring to the development, manufacture, marketing and sale of Fire Protected Apparel products within the Jeminex Group, other than the ISAS product, in the period 14 March 2008 to 2 April 2009. 36 This category is agreed but I order discovery in those terms only with the words I have struck through and with punctuation to make it clear that the time period qualifies the whole. 16. All documents recording, evidencing or referring to purchasing order procedures for ISAS in the period 14 March 2008 to 2 April 2009. 37 I reject this category. It is far too widely cast. It refers to purchasing order procedures for ISAS and procedures as such do not appear to be relevant. 17. All documents recording, evidencing or referring to the move of ISAS premises in the period 1 January 2008 to 2 April 2009 including but not limited to: – (a) Fit out; (b) Moving of ISAS records; (c) Establishment of IT support; (d) Establishment of computer equipment; and (e) Use of shared facilities, warehousing, storage, office support and sampling room; so as to integrate ISAS into the Respondent's systems and group of companies. 38 I reject this category. It is far too widely cast. The present effect of the limitation in the last line or so is to me obscure. 18. All documents recording, evidencing or referring to any: – (a) Complaints; (b) Problems or difficulties; (c) Repair work; and (d) Claims on warranties; in the period 1 July 2007 to 30 April 2009 in respect of the respondent's computer hardware and for computer software. 39 I reject this category. It is far too widely cast by reference to the issues that arise on the pleadings. 19. All documents recording consideration by the respondent of evidencing or referring to the funds and the capital that was to be made available to assist with the ISAS business in the period 1 January 2008 to 30 April 2009. 40 Again, it is a category where the respondent indicated a willingness to accept a narrower class. I order discovery of this category as amended by me. 20. All documents recording or evidencing or referring to the termination or proposed termination of the applicant's employment as ISAS Business Manager with the respondent. 41 With the marked words struck through category 20 is agreed to and I order that discovery be given in those terms. 21. All documents recording, or evidencing or referring to the performance of the ISAS business in the period 2 April 2009 to date being and indicative of: – (a) The cash flow; (b) Aged debtors; (c)Forecasts for sales, revenue and expenses; (d) Budgets; (e) Annual, half yearly or quarterly profit and loss statements; (f) Balance sheets; (h) Business plans; (h) Growth projections; (i) ISAS contracts that were cancelled or not renewed; (j) Profit distributions including dividends paid in relation to the ISAS business of a period 1 April 2009 to date; (k) Cross-subsidising of ISAS by other members of the Jeminex Group, either by cash injection, and use of resources, including IT equipment, office sharing, equipment sharing and common use of personnel. 42 I do not order discovery in accordance with category 21. In my view, for the period there specified performance of the ISAS business is not shown to be relevant on the pleadings. 22. All documents recording, or evidencing or referring to: – (a) Tthe due diligence, enquiries and audits undertaken by the respondent prior to entering into ISAS Sale Acquisition Agreement for the period 1 January 2007 to 14 March 2008; (b) The due diligence, enquiries and audits undertaken by the respondent during the earn out period, namely 14 March 2008 to 2 April 2009; (c) Any communications between the respondent and the AMP Group relating to the ISAS earn out period between 14 March 2008 to 2 April 2009; and (d) All sale acquisitions, enquiries and due diligence undertaken by the respondent in respect of John Smith and Noble Agencies. 43 I order discovery of this category as amended by me. I accept that in terms due diligence may not be relevant on the pleadings, but in my view it would cover relevantly what the respondent knew about the ISAS business in that time period. 23. The Income Tax Returns and Notices of Assessment for the Respondent for the financial years ending 30 June 2008, 2009, 2010 and 2011. 44 The relevance of this category has not been established and I will not make an order for discovery of those documents. In other words, this category is too general and insufficiently related to the issues on the pleadings. 45 Turning next to the respondent's request, the respondent gave a notice of discovery dated 1 June 2011. 46 The categories, and my conclusions, are as follows: (a) all documents showing product sales made by Industrial Safety Apparel Solutions Pty Ltd ("ISAS") between 30 January 2005 and 14 March 2008 ("the Relevant Period"), and in particular, those sales, and including the terms of arrangements under which ISAS made those sales; 47 I will order discovery in the terms of this paragraph as amended by me. (b) all documents evidencing each of the actual or proposed transactions in the Sales Forecast provided by the applicant to the respondent in an email sent by the applicant to Mr Kevin Jacobsen at 11.26 am on 20 January 2008, and in particular all documents evidencing or containing: (i) the actual or proposed transactions included in the Sales Forecast and relating to the Status provided for each of these transactions; and (ii) all communications between ISAS and each of the parties to the proposed transactions in the Sales Forecast and concerning each of the actual or proposed transactions referred to and its Status. 48 I will order discovery in these terms. In my view the categories are relevant. Certain matters were put to me from the bar table on behalf of the applicant as going to this issue but there is no evidence before me of those matters. (c) all documents showing containing or evidencing how the projected sales of $2.8m referred to in the Sales Forecast were to be achieved, including communications with all proposed customers in an attempt to meet that projected sales figure; 49 I will order discovery in these terms as I have amended them. In my view the category is relevant. Again, certain matters were put to me on behalf of the applicant from the bar table, but there was no evidence before me of those matters. (d) the negotiations between ISAS and the respondent in respect of the sale of the applicant's sale of shares in ISAS to the respondent, and in particular any document evidencing or recording any of the alleged representations which are in issue on the pleadings are the subject of the proceedings; 50 I will order discovery in these terms, with the marked deletion and addition. In my view the category is relevant. I note that so far as the discovery sought by the applicant is concerned I made the equivalent order under category 2. (e) the advice received by the applicant concerning the sale of the applicant's shares in ISAS to the respondent, the share acquisition agreement and the applicant's entitlement to rely on any alleged representation made in connection with the sale of the applicant's shares in ISAS to the respondent which are in issue on the pleadings; 51 This category raises a question of legal professional privilege and I will consider that in a little more detail below. In short, any documents in this category should be listed by the applicant and legal professional privilege claimed, if the applicant be so advised. The determination of any such claims must await any evidence that may be filed. (f) The applicant's assessment for the period 1 June 2007 to 31 March 2008 of how ISAS' financial position would be affected by the respondent's acquisition of the applicant's ISAS shares and the applicant's forecast of ISAS' financial position; 52 I will order discovery in these terms as I have amended them. In my view the categories are relevant. (g) For the period 1 June 2007 to 31 March 2008, the earn out budget that formed part of the Share Acquisition Agreement, and in particular all documents containing or recording the applicant's consideration of the earn out budget and how it might be achieved; 53 I will order discovery in these terms as amended by me. In my view the category is relevant. (h) The applicant's alleged expectations as to the anticipated operation of the ISAS business following the acquisition of Armit's ISAS shares ("the Post Acquisition Period"), and in particular all documents containing or recording Armit's assessment or forecast or proposals for the operation of that concern in that period and the lack of fulfilment of those alleged expectations regarding the customers that ISAS would retain or acquire; the contracts that would be entered into with them; the sales that would be achieved and the products that would be developed following the acquisition of the applicant's ISAS shares and in particular all documents containing or recording the applicant's expectations and the lack of fulfilment of those expectations; 54 As amended this paragraph is agreed and I order discovery in those terms. (i) any document showing the applicant's expectations as to the distribution, marketing, manufacturing plant and supply chain that she anticipated would be available to ISAS in the Post Acquisition Period, and any document containing or recording the non-fulfilment of those alleged expectations; 55 I will order discovery in these terms as I have amended them. In my view the categories are relevant. (j) any document showing the applicant's expectations as to the information technology that she anticipated would be available to ISAS in the Post Acquisition Period, and any document containing or recording the non-fulfilment of those alleged expectations; and 56 I will order discovery in these terms as I have amended them. In my view the categories are relevant. (k) any document showing the applicant's expectations as to access to the services of, and availability of, Mr van Buiten that would be available to ISAS in the Post Acquisition Period, and any document recording or containing the non-fulfilment of those expectations. 57 I will order discovery in these terms as I have amended them. In my view the category is relevant. 58 The only possible question of principle that arises is in relation to category (e) of the respondent's discovery request: (e) the advice received by the applicant concerning the sale of the applicant's shares in ISAS to the respondent, the share acquisition agreement and the applicant's entitlement to rely on any alleged representation made in connection with the sale of the applicant's shares in ISAS to the respondent which are in issue on the pleadings; 59 The applicant objected to the production of documents within this category on the basis that the applicant cannot be asked to produce them for inspection by the respondent as they are subject to legal professional privilege. The respondent submits that the applicant must be taken to have waived privilege in respect of these documents. 60 But in my view, any question of principle is premature. This is because the existence of any document within this category has not yet been established nor any document identified and the claim of privilege, if one is to be made, should be done by evidence in the ordinary way. The way forward is for the applicant to list the documents within this category and if so advised state that one or more of them is the subject of a claim for legal professional privilege. If that claim is challenged by the respondent and the applicant wishes to resist the challenge then evidence to establish the dominant purpose of the communication will become necessary. That step can await another day. Insofar as the applicant seeks to resist this category at the level of abstract principle I reject that submission. 61 The applicant draws my attention to the recent decision of Greenwood J in Austral Dutch Kaolin Pty Ltd v Hanjin P&C Co Ltd [2011] FCA 638. However as I understand it this decision does not deal with the listing of documents but rather with the making available of documents by means of inspection. In the present proceeding, as I have indicated, that point has not been reached. No evidence is before me. I should not however be taken to disagree with his Honour's conclusion at [25] that the mere pleading of reliance as an element of the cause of action does not impliedly waive privilege attaching to communications between an applicant and the applicant's lawyer. To that extent I reject the respondent's contention that it is clear at this stage that privilege has been waived. 62 Insofar as the applicant seeks to resist this category because it requires a judgment, I also reject that contention. The category seeks advice received. This is a matter within the applicant's knowledge. CONCLUSION 63 I order discovery in the terms that I have indicated, and that the parties by 4 October 2011 give discovery as ordered either electronically, or certainly in the case of category (e), by way of a list. 64 There was a question about subpoenas. At present I refuse leave to issue the seven or ten subpoenas. That can stand over until the discovery and inspection process takes place, but I would indicate that at present I would be unwilling to grant leave to issue subpoenas to third parties where it is material that is not exclusively within the possession or control of the third parties, but at least in part is material that is be within the possession or control of one or other of the parties. 65 In relation to costs question I acknowledge the force of what counsel for the respondent, put to me however, in terms of court time, the time for the various categories has been about equal. Further, the respondent did not file any written submissions on the topic of the applicant's discovery. I also take into account that there was no detailed response at any time by the respondent to the applicant's claim. It was put at the level of generality. So looking at the costs question globally – as I think I should, rather than category by category – my order is that costs be costs in the cause. That is costs of both applications be costs in the cause. I exclude the costs in relation to the application to issue subpoenas. I certify that the preceding sixty-five (65) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Robertson. Associate: Dated: 26 August 2011