New South Wales Supreme Court CITATION : British American Tobacco Australia Services Ltd v Blanch (No 2) [2004] NSWSC 133 HEARING DATE(S) : 04/03/04 JUDGMENT DATE : 4 March 2004 JURISDICTION: Equity Division JUDGMENT OF : Young CJ in Eq DECISION : Orders made. CATCHWORDS : EQUITY [378]- Injunctions- Whether undertaking offered a substitute for final injunction- Limited provision to be made in case of material change in circumstances. Autodesk Inc v Dyason (No 2) (1993) 176 CLR 300 Mancini v Mancini [1999] NSWSC 800 CASES CITED : McDonald Estate v Martin (1990) 77 DLR (4th) 249 Permewan Wright Consolidated Pty Ltd v AG (1978) 35 NSWLR 365 Royal Insurance Company Ltd v G & S Assurance Investment Company Ltd [1972] 1 Ll LR 267 Steed & Evans Ltd v MacTavish (1976) 68 DLR (3d) 420 PARTIES : British American Tobacco Australia Services Limited (P) Alan William Blanch, Roderick Stuart Cameron, Stewart William Cameron, Glenn Douglas Capel, Robert Geoffrey Horton, Cameron Leslie Leaver, Julius John Markos, Alan Sydney Osburg, Kathryn Margaret Ireland, Peter Wayne Gowers, David Francis Allen, Michael Hunt and Paul Hendriks trading as Hicksons Lawyers FILE NUMBER(S) : SC 1753/03 COUNSEL : J T Gleeson SC and R Sofroniou (P) R Burbidge QC and M T McCulloch (D) SOLICITORS : Corrs Chambers Westgarth (P) Hicksons (D) IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION YOUNG CJ in EQ Thursday 4 March 2004 1753/03 – BRITISH AMERICAN TOBACCO AUSTRALIA SERVICES LTD v BLANCH & ORS t/as HICKSONS LAWYERS (NO 2) JUDGMENT 1 HIS HONOUR: On 20 February 2004 I gave a set of the reasons and came to the view that there should be an injunction granted to prevent the defendants, solicitors, from acting further against the plaintiff. Those reasons followed the evidence and submissions that were made; so far as the evidence is concerned on 11, 12 and 15 December, and submissions that were received up to 22 December 2003. 2 The court has spent three hours this morning considering what orders should be made following those reasons. Mr Burbidge QC for the defendants has very thoroughly explored the matter and has reiterated the position taken by his clients at all material times, that there is no confidential information involved in this case anyhow that is relevant and his clients were never informed prior to the hearing of what was the confidential information relied on by the plaintiff. Furthermore, he says that his clients have been in a situation where they have always been ready to give appropriate undertakings to protect the plaintiff, and are still willing to do so. He points in particular to a set of undertakings set out in a letter to my Associate of 19 December 2003 and to amended undertakings in the letter sent to my Associate last night. 3 Mr Gleeson SC, who has appeared for the plaintiff, reminds me of what has been said on many occasions by courts of high authority, that when a case is decided, it is decided, and it is not in the public interest to re-examine what has been decided. If there is an error then the appellate court can deal with the matter; see for instance Autodesk Inc v Dyason (No 2) (1993) 176 CLR 300. 4 With respect, I consider a lot of what Mr Burbidge has put was material that was already considered in the earlier judgment, and if I am wrong the Court of Appeal can correct it. If not, it stands and I should not re-examine it. 5 However, there was one matter in respect of which I think Mr Burbidge does make a legitimate complaint, and does not fall foul of the Autodesk principle, and it comes about this way: 6 At the end of the hearing on 15 December 2003 I directed that further submissions could be put in writing; the defendants by 19 December and the plaintiff by 22 December. This duly occurred. However, when the defendants were making their submissions the defendants' solicitors, who are actually the defendants themselves, wrote to my Associate: "Please supply to his Honour the following attached documents: 1. Defendants' further outline of submissions. 2. Copies of two letters to the opposing solicitors; and 3. Copy letters from the opposing solicitors to the defendants". 7 There was in that bundle a series of undertakings that were proffered. 8 Now, there is a difference between making written submissions and providing further evidentiary material. Normally if the judge is to be told of anything, other than submissions on the law, or an analysis of the evidence that has already been given, a party must seek leave to reopen its case. That never occurred. 9 The letter, however, did say that Allianz, the insurer who is probably the solicitors' real client, has instructed the solicitors to proffer certain undertakings. 10 The reaction of the plaintiff's solicitors was that they considered the offer of undertakings was merely a matter of form, and in their written submissions of 22 December 2003 they made reference to the undertakings and why they were inadequate. 11 Unfortunately, I did not include in my reasons of 20 February 2004 any reference to those undertakings. I should have done so, and it may be, and I have no independent memory of this, that I considered that they were not properly before me because they had never been part of a reopened case. 12 However, I think it behoves me to briefly say why they make no difference. 13 First of all, I think there is great doubt as to whether the court can enforce upon an unwilling plaintiff in a final injunction the acceptance of undertakings when the plaintiff has demonstrated a case for injunction. I have not been able to find much material on this in the short time I have had to think about it, but it seems to me that the discussion between Whitford J and counsel in Royal Insurance Company Ltd v G & S Assurance Investment Company Ltd [1972] 1 Ll LR 267 at 285-6 shows that the English practice is that in an application for final injunctions, which is found in the plaintiff's favour, if the defendant offers undertakings in the precise terms of the injunction which the judge has in mind, for cosmetic or other reasons, and the plaintiff insists on the injunction, the injunction is made. Dr Spry in the 6th edition of his Equitable Remedies (LBC, Sydney, 2001) p 479 suggests that: "The general principle [is] that if an injunction is otherwise appropriate an undertaking should not be substituted unless special circumstances render this latter course desirable." 14 The learned author distinguishes between what happened in the 19th century and the current practice, but finally relies on the Royal Insurance Company case. I do not know of any New South Wales cases which deal with the point. With respect, it seems to me that the rule set out in Spry is the general rule. 15 Accordingly, even if the undertakings which are proffered cover the same field as the injunction (which they do not in this case), then if the plaintiff insists on the injunction (as it does), I consider that I would be obliged to grant the injunction, unless there were special circumstances. 16 Mr Burbidge says that if that is the rule, there are special circumstances. The defendants were always willing to give undertakings. If one looks at the Royal Insurance case that is exactly the situation that was before Whitford J and did not make him waiver. Accordingly, in my view, as a matter of principle, the proffering of the undertaking does not make any difference. 17 If one had to look at the merits of the undertakings, there are great difficulties in them. They do not cover the same field as the proposed injunction; there would be great difficulties in policing and enforcing them and, indeed, I think there is a lot in what Mr Gleeson says, that they involve what is called in his original submissions, and referred to in para 47 of my original judgment, the impossibilities of a Chinese wall in Mr Blanch's mind. 18 Mr Gleeson again reminded me of the number of occasions where judges throughout the British Commonwealth of Nations have made it clear that the erection of Chinese walls, or notional Chinese walls, is no answer to the present sort of problem; see, for instance, Steed & Evans Ltd v MacTavish (1976) 68 DLR (3d) 420, 421 and McDonald Estate v Martin (1990) 77 DLR (4th) 249 at 269, where Sopinka J said in the Supreme Court of Canada that really all such undertakings amount to is a lawyer saying "trust me", and in this sort of case the plaintiff is entitled to more than that. 19 Accordingly, I do not consider that the proffered undertakings make any difference to the decision I reached on 20 February 2004. 20 Accordingly, it is necessary to consider what are the form of orders. The form of orders proffered by the defendants still maintain, despite what is in the judgment, that it has never been identified to them what the confidential information is; that the plaintiff must specify exactly what the confidential information is, and that there should be an acceptance of certain undertakings and an injunction is not necessary. 21 Now, as to that, I really found against that case in my judgment. There is certainly, as I referred to in my judgment, cases such as Mancini v Mancini [1999] NSWSC 800, which say that it behoves a plaintiff in this type of case to specify the information sought to be protected in a precise manner, but there are limits to which that can be done because, as the judgment points out, a solicitor not only receives direct information from the client, the client also suggests to the solicitor sources of other information, and the solicitor's own researches obtain information. Some of that information will come within the category of "know-how", which is the solicitor's property, otherwise it is the confidential information of the client and only the solicitor knows the extent of it. 22 The court does not grant an injunction against a solicitor acting merely because a subsequent client is a competitor of a previous client. However, the law, as suggested in my previous reasons, makes it clear that if there is a situation where a client has given a solicitor confidential information, and the solicitor cannot show the court that there will be no real prejudice to the client (perhaps the word "real" is overstating the situation) then an injunction goes to stop the solicitor acting. 23 Now, in such a situation, as I point out in the judgment, it is counterproductive to examine the facts too fully because the more one does that, and the more one identifies the confidential information by chapter and verse, the more the plaintiff is prejudiced. 24 In this case, at para 119, I mentioned that there were seven categories of confidential information claimed by the plaintiff. Mr Burbidge says I never made any finding that all that information was confidential. That is true, and the reason for it is that I expressly said I would not do that. However, it seems to me that the plaintiff may well be prejudiced by any of that information being in the hands of the defendants and being used against the plaintiff in the cross claim in the Mowbray litigation. 25 Accordingly, it would seem to me that the injunction should be in such a nature that the categories set out in para 119 be used in the order, so that any documents that fall within any of those seven categories are to be dealt with, and that will avoid there being as much debate, as there otherwise might be, as to what the defendants have to do to obey the order. 26 What I am about to say may need modification, but it would seem to me that the orders should be something like this: 1. The defendants by themselves and their servants be restrained from further acting against British American Tobacco Australia Services Ltd (BATAS) in proceedings 176 of 2001/CC1 in the Dust Diseases Tribunal of New South Wales. 2. That, subject to order 3, the defendants deliver by 17 March 2004, or such other date as the court may allow, to the plaintiff's solicitors all documents in their possession or custody containing any of the following information: (a) the nature of BATAS' internal operations as deposed to by Frieda Stelzer; (b) the litigation adopted by BATAS in the Frieda Stelzer matter; (c) information as to how BATAS kept its records; (d) information about documents in the possession or former possession of BATAS which might appear to be relevant to lung cancer; (e) information as to the names and addresses of employees of BATAS and their internal operation; (f) information from interrogatories as to when BATAS learned of any problems with asbestos; and (g) information concerning the strategy of BATAS in dealing with litigation. 3. The defendants deliver to Messrs Griffith Hack by 17 March 2004, or such other date as the court may allow, all documents in their possession or custody containing or derived from any confidential information specified in order 2 in respect of which they, Allianz Australia Limited or Brambles Australia Limited assert privilege. 4. As per the plaintiff's notice of motion of 25 February 2004. 5. Then orders 5 to 8 as per the plaintiff's notice of motion of 25 February 2004. 9. As per the plaintiff's notice of motion of 25 February 2004. 10. That Messrs Griffith Hack solicitors, in the first instance, are to give their opinion, at the joint cost of the parties, as to any dispute that might arise as to the implementation of these orders, with liberty to apply to the Registrar, should those solicitors not be able to resolve such dispute, on three days' notice. 11. Liberty to approach the court to discharge any of these orders with the leave of a judge, if such judge is satisfied that circumstances have materially changed from the making of these orders so as to warrant consideration of the discharge of them or some of them. 12. Order that the defendant pay the plaintiff's costs of the proceedings. 27 I have inserted order 11 because I consider that this is a case where, because circumstances may materially change in a year or so's time, some limited opportunity should be afforded the defendants to have the injunction reviewed to avoid the problems dealt with in Permewan Wright Consolidated Pty Ltd v AG (1978) 35 NSWLR 365. 28 Mr Burbidge has also asked for a stay. I cannot at this stage see any great prejudice that would be averted by ordering a stay. The undertakings proffered are that no substantive steps will be taken in the Dust Diseases Tribunal proceedings pending the hearing of the appeal, if any appeal is lodged. There will, I am told, be some minor matters such as returns of subpoenas in that Tribunal. I cannot see why that situation cannot be dealt with by some new firm of solicitors being retained merely to do the mechanical matters while the appeal is being considered. 29 Accordingly, I decline to grant a stay. ******************** Last Modified: 03/09/2004 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.