Supreme Court New South Wales Medium Neutral Citation: Westgate Finance v May [2012] NSWSC 806 Hearing dates: 13/07/2012 Decision date: 13 July 2012 Jurisdiction: Equity Division - Commercial List Before: McDougall J Decision: Applicant to produce unredacted copies of documents except where privilege claimed over redacted material; applicant to file affidavit evidence in support of claims for privilege. Catchwords: [PROCEDURE] - civil - subpoena - whether recipient of subpoena should produce unredacted copies of documents - application for amended subpoena to be set aside - whether further compliance with subpoena should be dispensed with. Legislation Cited: Practice Note SC Eq 11 Cases Cited: Bailey and Anor v The Director General, Department of Land and Water Conservation and Ors (2009) 74 NSWLR 333 Drivetime Radio Australia Pty Ltd v Pivotal Creative Solutions Pty Ltd trading as Broadcast GP [2010] NSWSC 763 NAK Australia Pty Ltd v Starkey Consulting Pty Ltd [2008] NSWSC 1136 Category: Procedural and other rulings Parties: Westgate Finance Pty Limited (Plaintiff) Christopher May (First Defendant) Pauline Howes (Second Defendant) Airport Fuel Services Pty Limited (Interested party) Representation: Counsel: R A Yezerski (Plaintiff) B J Miller (Solicitor) (Defendants) L T Livingston (Airport Fuel Services) Solicitors: Pigott Stinson (Plaintiff) Garland Hawthorne Brahe (Defendants) HWL Ebsworth (Airport Fuel Services) File Number(s): 2011/301205 Judgment - Ex tempore (revised 13 july 2012) 1HIS HONOUR: There are before the Court two notices of motion relating to a subpoena (as amended, in circumstances to which I shall come) issued at the request of the plaintiff requiring Airport Fuel Services Pty Limited (AFS) to produce certain documents. AFS has produced documents falling within the subpoena as amended. However, at least some of those documents have been redacted. 2By its notice of motion filed on 10 July 2012, AFS seeks orders that the amended subpoena be set aside, or alternatively that further compliance with it be dispensed with. 3By its notice of motion filed on 27 June 2012, the plaintiff seeks orders that AFS produce forthwith unredacted copies of documents produced in redacted form. 4It seems that the plaintiff provided finance, through a factoring facility, to AFS. In its case as presently constituted, the plaintiff asserts that it was induced to do so by misleading or deceptive conduct on the part of the defendants. The defendants are said to have made serious misrepresentations as to the volume and extent of the business of AFS. It is unnecessary to go further into the issues. That is because, in the circumstances to which I now turn, the adjectival relevance of the documents sought by the amended subpoena has been established. The orders of 22 February 2012 5The subpoena as originally issued was the subject of an application heard by Ball J on 17 February 2012. AFS sought orders either setting aside the subpoena or limiting its obligations to produce. The plaintiff sought to uphold the subpoena. As a result of the views expressed by Ball J in the course of the hearing, the parties brought in short minutes of order and his Honour made orders accordingly on 22 February 2011. 6The effect of the orders was that the subpoena be amended, in accordance with a form of subpoena attached to the short minutes, and that AFS "produce to the Court documents in accordance with the amended subpoena within 14 days after the date of making of these orders". Production of redacted documents 7AFS produced documents to the Court, although not all within 14 days of 22 February 2012. However, many of the documents produced were redacted, as I have said, on various bases. 8As amended, the subpoena contained some five separate paragraphs describing documents required to be produced. To the extent that documents have been produced in accordance with paragraphs 1, 2 and 3 (as amended, and I shall not trouble to repeat this phrase), they do not appear to have been redacted. The Court was informed that one document produced in answer to paragraph 6 was redacted. That paragraph required production of: "All tax invoices issued by Ramar or R & G to AFS in the period 1 January 2010 to 31 January 2011 and all correspondence referring to any such tax invoices." 9It is unnecessary to describe further the entities Ramar and R & G. 10The effect of that particular command is that tax invoices issued by Ramar or R & G within the required period should be produced. Further, correspondence referring to any such tax invoices should be produced. Thus, any document falling within the description "correspondence referring to any such tax invoices" was producible by force of that individual command. It matters not that the document may have referred to other subjects. There was no implied, let alone express, limitation to the effect that a document referring to a tax invoice of the kind described need be produced only to the extent that it did so. 11Thus, in my view, it was not appropriate for AFS to redact the document that, apparently, was redacted before production in answer to the command of paragraph 6 of the amended subpoena. Paragraph 7 of the amended subpoena 12Otherwise, the disputes relate to documents falling within paragraph 7. That paragraph requires production of: "The documents brought into existence for the purpose of any investigation conducted in or around January 2011 into Christopher May's employment or conduct whilst employed at AFS limited to any of the statements of any person (including but not limited to Mr Christopher May and Mr Wesley Doyle); records or notes of interviews/meetings with any interviewee(s); and any record of the conclusions of any such investigation." 13The drafting of that paragraph is not without its problems. 14The Court was referred, in the course of argument today, to the reasons indicated by Ball J in the course of argument before his Honour. Paragraph 7 had originally required production of documents "relating to" the investigation, and was not limited in the way that the paragraph now is by reference to particular statements et cetera. His Honour indicated (T21.40) that he had "a difficulty with the words 'relating to'". Thus, his Honour said, he would permit the plaintiff to proceed by requiring documents "brought into existence" for the described purpose. 15His Honour amplified those views at T22. As he said at 22.8 and following, it seemed that what the plaintiff wanted was "any statements and any report or other document recording the conclusions in relation to the investigation". His Honour accepted that the plaintiff was entitled to have that. Further, his Honour said (at lines 36 and following) that the production should extend to documents recording conclusions and records of interviews and meetings and notes of interviews. 16It is apparent from what was said by counsel then appearing for AFS at T22.22 and following that what AFS was concerned to exclude was "all the emails internally where it's the internal thinking of AFS which can't be of any help to the plaintiff"; and again, "the internal thinking of [AFS] which could not be relevant". 17Ball J said at line 32 that he accepted this proposition in principle. 18Thus, if (as counsel now appearing for AFS invited the Court to do) it were legitimate to have regard to the transcript, insofar as the reasons can be discerned from it, for the purpose of construing paragraph 7 of the subpoena, that transcript appears to indicate that the Court's concern was to exclude purely internal documents, showing the thinking of AFS but not recording its conclusions based on the investigation; and that this concern was reflective of the proposition that the internal thinking was irrelevant. 19Looking at paragraph 7 as it stands, and putting to one side for the moment such inferences as may be drawn from the transcript of argument that led to its production, it seems that documents are producible if they meet two qualifications. The first qualification is that they be brought into existence for the purpose of any investigation as described. However, not all documents brought into existence for the purpose of any such investigation are producible. That is because the second qualification then operates. What are producible are documents brought into existence for the required purpose that meet the description of statements of any person, records or notes of interviews or meetings, and records of conclusions. 20If documents get through each of those successive restrictions then, it seems to me, they are producible. That is because they answer the Court's command. If documents that get through both those restrictions also refer to other things, that does not make them other than producible. Nor, in my view, does the fact that the documents go beyond the limitation mean that AFS is entitled to redact them. Right to redact? 21Mr Livingston of counsel, who appeared today for AFS, referred to a number of decisions on the topic of redaction. Those decisions included the decision of Brereton J in NAK Australia Pty Ltd v Starkey Consulting Pty Ltd [2008] NSWSC 1136 and of the Court of Appeal in Bailey and Anor v The Director General, Department of Land and Water Conservation and Ors (2009) 74 NSWLR 333. 22If I may say so with respect, neither of those decisions appears to take the matter much further, except insofar as neither establishes anything beyond the proposition that, where a document is producible (and for present purposes, it does not matter whether it is producible on discovery, or in answer to a notice to produce, or on subpoena) material within the document that is shown to be privileged may be redacted. 23Of more relevance is the decision of Brereton J in Drivetime Radio Australia Pty Ltd v Pivotal Creative Solutions Pty Ltd trading as Broadcast GP [2010] NSWSC 763. In that case, his Honour gave consideration to the practice of redacting documents produced under compulsion of the Court's process. His Honour indicated, again, that privileged material could be redacted before production, but that the right to redact was not otherwise generally available. What his Honour said at [25] was that: "...in an appropriate case the court will grant leave to a party required to produce documents or otherwise having an interest in documents produced to mask or redact irrelevant and confidential information in those documents. That is not a matter of right - as distinct from where the redaction is based on a claim for privilege - and must be the subject of an application for leave to the Court." 24In my view, that is the approach to be taken. I emphasise that it is an approach to be taken not where documents are said to be privileged (where there is a "right" of redaction) but where documents are said to contain material that is both "irrelevant and confidential" (where the leave the Court is necessary to redact). 25Nothing in what his Honour said justifies the redaction of documents to exclude material that is (perhaps) irrelevant, but that is not confidential. In my view, as a matter of policy, the court should not countenance a practice of redaction of documents, produced pursuant to its purposes, simply on the basis that some of the material within the document is said to be irrelevant. 26Once it can be said that a document answers the Court's requirement for production (and I say again that it matters not for present purposes whether the requirement is one arising on discovery, or pursuant to a subpoena or notice to produce), and putting aside questions of privilege and confidentiality, the very fact that the document answers the command is what requires it to be produced. The fact that it may go beyond the command, in the sense that it may contain material extraneous to the purpose that makes production mandatory, does not justify redaction. 27It is notorious that one person's view of relevance may not be the same as another's. It is equally notorious that different people, looking at documents from different perspectives and for different purposes, may have legitimate disagreements about relevance and irrelevance. Where, prima facie, a document is producible because it answers the description in the Court's command, the person required to produce it should not, in my view, deprive the party entitled to the benefit of production from inspection of the whole of the document - and again, I emphasise, in the absence of privilege or confidentiality - because of some subjective view of relevance. That is so, a fortiori, where the person producing the document is a stranger to the litigation (as is AFS in this case), and perhaps not in a position to make a judgment as to relevance which depends on an understanding of the issues raised on the pleadings. 28Thus, I do not think that it was open to AFS, without the leave of the Court, to redact documents otherwise answerable to the command of the amended subpoena on the basis that the redacted material was irrelevant in the sense that I have described. Privilege; confidentiality 29That leaves, in relation to redaction, the questions of privilege and confidentiality. 30The evidence on those topics was lamentably deficient. It consisted of an assertion by a solicitor in the employ of the solicitors for AFS that she had reviewed the documents under the supervision of a partner, and that she consulted with that partner in relation to the redaction or possible redaction of particular documents. She said that if the partner ultimately came to the view that the document did not fall within the categories of the amended subpoena, or was privileged, then it was not produced. There was simply no evidence of the application of that reasoning process to any particular document so as to enable the Court to form a view as to whether, in respect of any individual document, the claim for privilege might be made out. 31Nor was there any evidence, so far as I can tell, that a document was "confidential" in any sense other than that it was a confidential communication which, because made for one or other of the requisite purposes, attracted legal professional privilege. 32Mr Livingston invited the Court to inspect unredacted copies of the documents to form its own view. I do not think that it is appropriate in this case for the Court to do so. There is no doubt that the Court can inspect documents for the purpose of determining a question of privilege. However, that is normally done where there is a legitimate dispute shown as to the question of privilege. In other words, where there is conflicting evidence as to privilege, it is open to the Court to inspect the document to determine for itself whether the claim for privilege has been made good. But for the Court to do so when there is no evidence at all of privilege means in effect that the Court is doing the work of the party making the claim for privilege. It means, further, that the question of privilege would be dealt with on an evidentiary basis in which the party resisting the claim for privilege (and seeking production of the document or of the redacted portion) had no opportunity to meet or test. It would be otherwise if (for example) the employed solicitor or the partner had given evidence of her or his consideration of individual documents, and of the conclusions in relation to the document which were said to justify the claim for privilege. 33In those circumstances, and subject to turning to the notice of motion filed for AFS, with which I will deal in a moment, it seems to me that if an order is to be made for production of documents in unredacted form, it would be appropriate, subject to questions of costs, to give AFS an opportunity to put on proper and admissible evidence substantiating any claim for privilege. AFS's notice of motion 34However, I have yet to deal with the notice of motion filed for AFS. In a sense, in doing that, I have dealt with the applications out of order; but I have done so because it seemed to me to be convenient to deal with them in the way that I have. 35The argument for AFS, on its motion, was that the amended subpoena was an abuse of process and was pressed for an improper and ulterior purpose. The abuse of process argument had two limbs. The first limb was that, since the commencement of Practice Note SC Eq 11 on 26 March 2012, the production of documents should be dealt with in accordance with the requirements of that Practice Note. Accordingly, Mr Livingston submitted, the plaintiff's insistence on production of unredacted documents was an attempt to circumvent the operation of the Practice Note. 36I do not accept those submissions. The chronology in this case is that AFS was required, by force of the Court's orders made on 22 February 2012, to produce (within 14 days of that date) documents falling within the amended categories 1, 2, 3, 6 and 7 of the amended subpoena. It cannot in my view be an abuse of process for the plaintiff, for whose benefit those orders were made, to insist on compliance. AFS is not a party to the proceedings. What is sought from it is not discovery. The effect of the Court's orders is a conclusion that production of the documents is justified by or for the legitimate forensic purposes of the plaintiff. It can hardly be an abuse of process for the plaintiff to seek to vindicate the rights established by the orders of 22 February 2012. 37The other argument as to abuse of process was based on the proposition that the plaintiff considered that it might have a claim against AFS, and was considering joining AFS. That proposition was said to be established because of correspondence in May and June this year in which the plaintiff asked AFS to participate in a mediation, AFS said it would do so, and the plaintiff then, apparently without pursuing the process of mediation, indicated that it would pursue its application for production of unredacted copies of the documents in question. 38Mr Livingston submitted that I could infer from this that the plaintiff thinks that it has a claim against AFS and that it is now seeking production of the documents to see whether or not it has such a claim. 39That suggested ulterior and improper purpose was not put to the plaintiff's solicitor in cross-examination. Nor was it shown, in my view, why it is improper for a person having the benefit of orders of the Court to insist on proper compliance with those orders, even though that proper compliance may lead to a situation where the person having the benefit of the orders learns that it has a claim against the person bound by the orders. 40In other words, and assuming for the moment that the production that had taken place prior to the exchange of correspondence to which I have referred (and it appears that the process of production of redacted documents was complete by that time) demonstrated to the plaintiff that it might have a case against AFS, the circumstance relied on affords no reason disentitling the plaintiff to full and proper compliance. 41To put the matter more bluntly, I do not think that whatever may be inferred from the events of May and June 2012 has retrospective effect, so as to infect with improper purpose the orders made on 22 February 2012. 42The other aspect of the submissions for AFS on its notice of motion dealt with the questions of irrelevance, confidence and privilege. I have not overlooked that AFS relied on those matters not only in answer to the plaintiff's notice of motion but also in support of its own claim based on the arguments of improper purpose. Since I have concluded that the arguments as to irrelevance and confidence (apart from privilege) fail, it follows that they cannot help the arguments based on abuse of process. And since I have concluded that, prima facie, AFS should have an opportunity to vindicate its claim for privilege, that likewise cannot assist in relation to the claims based on abuse of process. Conclusions to date 43The result of all that is that the notice of motion filed by AFS on 10 July 2012 should be dismissed with costs, and I so order. 44Prima facie, the plaintiff is entitled (subject to the question of timing) to orders in accordance with its notice of motion. However, I will, as I have indicated, permit AFS an opportunity to put on evidence as to its claim for privilege, and defer the making of orders on the plaintiff's notice of motion until that is done. [Counsel addressed.] 45There are some matters of detail to be resolved in relation to the reasons that I gave earlier on the competing notices of motion. The first is whether AFS should be given yet another opportunity to press a claim for confidentiality unrelated to any claim for privilege. I did not mean, in what I said earlier, to indicate that any such further opportunity should be given to it. 46The reason I came to that view was that the affidavit evidence on which AFS relied showed that the documents had been reviewed first to see whether they fell within any of the categories set out in the amended subpoena and secondly to see whether they were privileged. It was as part of the review for privilege that consideration was given to whether they were a confidential communication of the requisite sort. Presumably, all the documents have been reviewed. None of the evidence that was put on suggests that any of them had any character of confidentiality apart from confidentiality of a kind necessary as the first step in establishing a claim for privilege. Since I propose to allow a further time for AFS to attempt to make good a claim of privilege, that head of confidentiality can be put to one side. 47On 6 July 2012, the Court ordered, among other things, that AFS serve any material relied upon in support of its claim for redaction by 11 July 2012. The affidavit of the employed solicitor to which I have referred was presumably put on in response to that order. It is a clear inference from that affidavit, read in the light of the order, that questions of confidentiality, other than in support of a claim for privilege, were not thought to be worthy of attention. 48Nothing has been put to me to show why AFS should have another opportunity to do what it should have done, but did not do, earlier. 49The only reason why I am prepared to extend time in relation to privilege is that there is some basis in the affidavit for thinking that at least someone in the camp of AFS thought that there were maintainable claims of privilege. The evidence, in relation to confidentiality generally, does not go even so far. 50There are some minor details as to timing. It is simpler, and I think ultimately more likely to get this matter ready for hearing, to give AFS the time that it seeks to put on its affidavit in support of a claim for privilege. 51There is a question as to costs. The plaintiff seeks costs of its motion and of two directions hearings, 8 and 22 June 2012. It should have its costs to date of its notice of motion, but because that notice of motion has not been finally determined, it is inappropriate to make any further order. 52There are competing submissions as to why costs should or should not be allowed for the two directions hearings. Looking at the record of proceedings for the former (8 June 2012), bearing in mind that the latter (22 June 2012) was apparently before the Registrar for production of documents, and bearing in mind that the notice of motion on which the plaintiff has succeeded so far was filed on 27 June 2012, I think that the costs should be limited to the cost to date of that notice of motion. In addition, as I said in my earlier reasons, the plaintiff is entitled to its costs of AFS's motion. 53The defendants now wish not to put on their evidence until unredacted copies of documents are produced. It is submitted for them that this is what was always contemplated. However, I note that on 11 May 2012 the Court ordered, apparently by consent, that the defendants serve their affidavits in support of their commercial list response by a particular date. The form of that order appears to me to contemplate that the defendants would have a requirement to put on evidence in support of the facts asserted in their response, and a further opportunity to put on evidence in relation to documents produced on subpoena. I see no reason now to grant any relaxation, save as to time, in respect of the order of the Court earlier made by consent. 54For those reasons I make orders in accordance with paragraphs 1 to 7 as amended of the document initialled by me and dated today's date. 55I vacate the listing for directions on 20 July 2012. ********** 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. Decision last updated: 18 July 2012