New South Wales Supreme Court CITATION : Carbotech-Australia Pty Ltd v Yates [2008] NSWSC 1149 HEARING DATE(S) : 1 October 2008 JURISDICTION : Equity Division JUDGMENT OF : Brereton J EX TEMPORE JUDGMENT DATE : 1 October 2008 DECISION : Plaintiffs need not produce pursuant to Notice to Produce of 25 September 2008 such documents described as were sent by them after 30 June 2005 CATCHWORDS : PROCEDURE – NOTICE TO PRODUCE – whether notice serves legitimate forensic purpose – relevant considerations – stage of proceedings – available alternatives LEGISLATION CITED : (NSW) Uniform Civil Procedure Rules, rr 21.10, 21.11 CATEGORY : Procedural and other rulings Carbotech-Australia Pty Ltd (P1) Ground Consolidation Pty Ltd (P2) Minova International Pty Ltd (P3) Ian Kenneth Yates (D1; XD1 in XC1; XD2 in XC2; XP1 in XC3) Donna Yates (D2; XD2 in XC1; XD3 in XC2; XP2 in XC3) Eligild Pty Ltd (D3; XD3 in XC1; XD4 in XC2; XP3 in XC3) Ron Godfrey Nielsen (D4; XD4 in XC1; XD5 in XC2; XP4 in XC3) SES Resources Pty Ltd (D5; XP1 in XC1; XD6 in XC2) PARTIES : SES 2005 Pty Ltd (D6; XP2 in XC1; XD7 in XC2) Wombat Holdings (NSW) Pty Ltd (D7; XD5 in XC1; XD8 in XC2; XP5 in XC3) Global Resins Pty Ltd (D8; XP3 in XC1; XD9 in XC2; XD3 in XC3) SES International Ltd (D9; XP4 in XC1; XD10 in XC2) Mark Weston (D10; XD6 in XC1; XD1 in XC2; XD6 in XC3) Era Polymers Pty Ltd (D11; XD7 in XC1; XP1 in XC2) Era Polymers Holdings Pty Ltd (D12; XD8 in XC1; XP2 in XC2) Geoffrey David Mellon (D13; XD9 in XC1; XD11 in XC2; XD9 in XC3) SES Holdings Plc (D15; XP5 in XC1; XD13 in XC2) FILE NUMBER(S) : SC 3813/05 Mr W G Muddle SC w Mr S A Goodman & Mr J A Arnott (Ps) Mr I K Yates (in person) (D1-3) COUNSEL : Mr A J Bulley w Mr C J M Palmer (D4, 7) Mr J K Kirk (D5, 6, 8, 9, 15) Mr C D Freeman (D11, 12) Clayton-Utz (Ps) SOLICITORS : Cameron & Myers (D4, 7) Allens Arthur Robinson (D5, 6, 8, 9, 15) Photios Vouroudis & Co (D11,12) IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION BRERETON J Wednesday 1 October 2008 3813/05 Carbotech-Australia Pty Ltd & ors v Ian Kenneth Yates & ors JUDGMENT (ex tempore) 1 HIS HONOUR: The SES defendants have served on the plaintiffs a notice to produce for inspection under (NSW) Uniform Civil Procedure Rules ("UCPR"), r 21.10, requiring production by 9am on 29 September 2008 of "all documents sent by the plaintiffs to any coal mine or colliery in New South Wales in the period from 1 July 2004 to 1 September 2008 setting out prices or proposed prices to be charged by the plaintiffs for secondary support service." The plaintiffs move orally pursuant to UCPR, r 21.11, for an "otherwise order", to the effect that they not be required to produce the documents referred to in the notice, or alternatively to set the notice aside. 2 The plaintiffs' application is founded on the proposition that the notice does not serve a legitimate forensic purpose; at least at this stage, no question of oppression is raised. Accordingly, I can confine my consideration to whether the notice serves a legitimate forensic purpose. 3 In these proceedings, the plaintiffs claim equitable compensation assessed on the basis, at least as I presently understand it, of the revenues that Ground Consolidation ("GroundCon") would have derived from the Springvale contract for a period of 12 months after 1 April 2005, at which time GroundCon lost the Springvale contract to SES. Although there will no doubt be argument as to what considerations properly inform the award of equitable compensation, it must be at least arguable that the defendants are entitled to show, if they can, in answer to the claim for damages, that GroundCon would not, in fact, have retained the contract revenue from Springvale for a year after 1 April 2005 – including on the basis that if they had not lost the contract to SES when they did, they would have lost it to someone else soon after. 4 Evidence that tended to show that the rates offered by GroundCon to Springvale in early 2005 were relatively high must, it seems to me, be relevant to that proposition, since the relative cost to Springvale of retaining GroundCon as against any potential competitor must bear on the likelihood of GroundCon retaining or losing the contract. It is not an answer to that that at the relevant time this was, as Mr Muddle SC put it, a two horse race – since if Springvale were dissatisfied with GroundCon prices in early 2005, even if SES were not on the scene, it might have begun to look elsewhere. The documents sought, for the period up to, say, 30 June 2005 are, therefore, plainly relevant, because they will describe what prices the plaintiffs were offering elsewhere at and about the time of the relevant dealings with GroundCon in early 2005. 5 But it is much more difficult to appreciate the potential relevance of documents which postdate the first half of 2005. Mr Kirk, for SES, seeks to support their relevance on the basis that they might show that, even in the years following 2005, GroundCon had never attained from any other mine the prices which it then offered Springvale. For such evidence to be probative, more would be required than the mere fact that such a price had never been obtained: at least some evidence informing a comparison of the markets and the mines at the different times and locations would, prima facie, be required, and none has been served or foreshadowed. Although I am not concerned in the present exercise with determining whether the material elicited by the notice would be ultimately admissible – it suffices that it be "on the cards" that in one way or another the material elicited would add to the body of relevant evidence in the case (for example, it may inform cross-examination, even if it is not admitted; and even if evidence of comparability of the market at other venues and times has not at this stage been served, it is conceivable that it could be elicited in the cross-examination), nonetheless, the release of the documents called for becomes increasingly difficult to support, the more remote the time is from early 2005. 6 When it comes to judging legitimate forensic purpose it is, I think, permissible to take into account the principle that proceedings are to be conducted in a manner that facilitates their just, quick and cheap resolution. It is relevant also to take into account the stage at which the proceedings are, and the reasonable alternatives which might be available to obtaining the information sought. As I have discussed in the course of argument with Mr Kirk, far more expeditious alternatives are available to issuing this notice in the first instance, that would at least limit the scope of what might reasonably be required. In saying that, I am not to be taken for a moment to suggest that a party should be limited to only one way of exploring relevant facts; far from it. Nor am I to be taken as saying that had this course been embarked upon earlier in the proceedings, a different result might not have prevailed. But given the current status of the proceedings (week two of an eight week trial), and the evidence that has so far been served (which does not include evidence of market comparison), it seems to me that a far less comprehensive notice could serve the defendants' legitimate purpose if it were framed with the benefit of relevant evidence elicited in cross-examination from a witness such as Mr Meikle, as to whether prices of that order had ever been achieved elsewhere during the relevant period. 7 I am therefore of the view that there is insufficient legitimate forensic purpose in obtaining production of the documents called for after 30 June 2005, bearing in mind the available alternatives and the present status of the proceedings. 8 Accordingly, pursuant to UCPR r 21.11, I order that the plaintiffs need not produce, pursuant to the notice of 25 September 2008, being VD18, such documents described in the notice as were sent by them after 30 June 2005. 9 It may be that, in the light of further evidence, a basis for a narrower notice in respect of the period after 30 June 2005 could be established. 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