FEDERAL COURT OF AUSTRALIA Ensham Resources Pty Ltd v AIOI Insurance Company Limited [2011] FCA 1392 Citation: Ensham Resources Pty Ltd v AIOI Insurance Company Limited [2011] FCA 1392 Parties: ENSHAM RESOURCES PTY LTD (ACN 011 048 678) v AIOI INSURANCE COMPANY LIMITED, MITSUI SUMITOMO INSURANCE COMPANY LIMITED, SOMPO JAPAN INSURANCE INC, TOKIO MARINE & NICHIDO FIRE INSURANCE COMPANY LIMITED and NISSAY DOWA GENERAL INSURANCE COPORATION LIMITED File number: NSD 1256 of 2010 Judge: NICHOLAS J Date of judgment: 21 November 2011 Legislation: Federal Court Rules 2011 (Cth) r 24.15 Date of hearing: 18 November 2011 Place: Sydney Division: GENERAL DIVISION Category: No Catchwords Number of paragraphs: 14 Counsel for the Applicant: Ms CL Cochrane Solicitor for the Applicant: Freehills Counsel for the Respondents: Mr J Stevenson SC and Ms V Whittaker Solicitor for the Respondents: Mallesons Stephen Jaques IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1256 of 2010 BETWEEN: ENSHAM RESOURCES PTY LTD (ACN 011 048 678) Applicant AND: AIOI INSURANCE COMPANY LIMITED First Respondent MITSUI SUMITOMO INSURANCE COMPANY LIMITED Second Respondent SOMPO JAPAN INSURANCE INC Third Respondent TOKIO MARINE & NICHIDO FIRE INSURANCE COMPANY LIMITED Fourth Respondent NISSAY DOWA GENERAL INSURANCE CORPORATION LIMITED Fifth Respondent JUDGE: NICHOLAS J DATE OF ORDER: 21 NOVEMBER 2011 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The applicant's interlocutory application filed in Court on 18 November 2011 be dismissed with costs. 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 1256 of 2010 BETWEEN: ENSHAM RESOURCES PTY LTD (ACN 011 048 678) Applicant AND: AIOI INSURANCE COMPANY LIMITED First Respondent MITSUI SUMITOMO INSURANCE COMPANY LIMITED Second Respondent SOMPO JAPAN INSURANCE INC Third Respondent TOKIO MARINE & NICHIDO FIRE INSURANCE COMPANY LIMITED Fourth Respondent NISSAY DOWA GENERAL INSURANCE CORPORATION LIMITED Fifth Respondent JUDGE: NICHOLAS J DATE: 21 NOVEMBER 2011 PLACE: SYDNEY REASONS FOR JUDGMENT 1 This is an interlocutory application by the applicant to set aside 12 subpoenas for production issued by the respondents to various third parties. The substantive proceeding relates to the flooding of an open-cut coal mine near Emerald, Queensland (the Ensham mine). The applicant and respondents entered into an insurance policy in respect of the Ensham mine on or about 17 September 2007 upon which date the applicant paid the relevant insurance premium. The applicant claims that the Ensham mine was flooded in January 2008 as a result of which it suffered substantial loss and damage in respect of which it is entitled to indemnity under the policy. 2 The respondents have denied indemnity on the basis of alleged material non-disclosure. The trial of the proceedings is fixed for hearing before Emmett J commencing on 19 March 2012. Discovery has been given by the parties the scope of which was determined at a mediation held for that purpose. 3 The 12 subpoenas were issued by the respondent pursuant to leave granted by Emmett J on 2 November 2011. The application for leave to issue them was considered by his Honour in Chambers. In support of the application the respondents provided his Honour with a lengthy affidavit made by the respondents' solicitor. His Honour made orders granting leave to issue the subpoenas returnable on 23 November 2011. 4 The applicant now applies for an order under r 24.15 of the Federal Court Rules 2011 that the subpoenas be set aside or read down in accordance with various proposals in the schedule attached to the applicant's interlocutory application. The applicant says that the subpoenas are oppressive and that they constitute an abuse of process. There is no real evidence called by the applicant in support of either proposition. Instead, it seeks to make such propositions good by reference to matters of principle, and relevant parts of the pleadings and particulars. The respondents oppose the application. 5 Rule 24.15(1) provides that the Court may, on the application of a party or any other person having sufficient interest, set aside a subpoena in whole or in part, or grant other relief in relation to it. It is clear from the pleadings to which I was taken that a central issue in the case is the applicant's state of knowledge at the time, or immediately before, it entered into the policy in relation to various matters that the respondents say the applicant was required to disclose pursuant to its duty of disclosure. 6 The first argument relied upon by the applicant is that the subpoenas seek documents dated or brought into existence after 17 September 2011, that such documents are necessarily irrelevant, and that production could not serve any legitimate forensic purpose. That argument may be dealt with briefly. Even if the principal issue in the proceeding is concerned solely with the applicant's state of knowledge as at the date it entered into the policy, it does not follow that documents dated or brought into existence after that date may not contain information that is directly or indirectly relevant to the applicant's then state of knowledge that might be deployed by the respondents in evidence or in cross-examination. I am not willing to set aside or vary the subpoenas on this basis. 7 The applicant's second argument is that the subpoenas use words or expressions that cannot be used permissibly in a subpoena for production. In particular, the applicant takes issue with the use of the expression "relating to" and the word "regarding" in the description of the categories of documents in respect of which production is sought. 8 I do not think this is a valid objection. There is no absolute rule forbidding the use of such words in a subpoena for production directed to a third party. Whether or not the subpoena for production is objectionable on account of the presence of such words depends upon the context in which they are used. In the present case the relevant categories for production are quite specifically defined. This is certainly not a case where the third party upon whom the subpoena is to be served is required to form a judgment as to what is relevant to the issues in a proceeding to which it is not a party. Here, the documents sought to be produced are identified with reasonable particularity, such that the third party ought to know with reasonable certainty what documents are required to be produced. 9 The third argument focussed on the respondents' defence and particulars given in relation to it. In particular, it was said that the subpoenas were too broad in that they sought production of documents regarding the actual and recommended height, construction and condition of various levies apart from those referred to in the pleadings and particulars. A similar argument was made in relation to documents regarding the height of the flood, it being said that this was a matter not in dispute in the proceeding. Another argument advanced by the applicant was that these documents, or at least many of them, were not required to be produced pursuant to the agreed discovery regime and that this was a matter that was relevant to the question of whether or not the subpoenas for production (which sought documents beyond the scope of what had been agreed to in discovery) were oppressive or an abuse of process. 10 So far as the last of these arguments is concerned, I do not accept that the subpoenas for production are objectionable simply because they travel beyond categories of documents which were agreed for the purposes of discovery. It is commonplace for parties to agree to or for the Court to order discovery on the footing that the parties may be able to seek production of documents not only from parties to the proceedings but also third parties that are not confined to documents within the scope of any discovery which has been agreed or ordered. 11 The parties' evidence has not yet been filed. The evidence to be relied upon by each of the applicant and the respondents – or at least upon which each of them bears the onus of proof – is due to be filed by 30 November 2011. 12 It is difficult to assess at this stage whether the documents sought by the respondents will assist them with the proof of their case. In particular, I am not able to say at this stage whether documents that do not directly relate to levies other than those specifically referred to in the pleadings and particulars might not be directly or indirectly relevant to the matters in issue. I make the same observation in relation to documents concerning "the height of the flood". I am therefore not persuaded that any of the subpoenas for production are, on their face, oppressive or an abuse of process. 13 I should add that the applicant indicated during the hearing of this application that it is concerned that the issue of the subpoenas so soon before the respondents' evidence is due might lead to a delay in the filing of the respondents' evidence. There was no indication from the respondents during the course of the hearing before me that they would not be able to comply with the orders of Emmett J in relation to the filing of their evidence, and the respondents have not sought from me any variation of that order. I would therefore expect the respondents to comply with his Honour's order for the filing of their evidence in accordance with its terms whatever production or non-production of documents may occur pursuant to the 12 subpoenas for production which have been issued. 14 In the result the applicant's interlocutory application will be dismissed with costs. I certify that the preceding fourteen (14) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Nicholas. Associate: Dated: 6 December 2011