Supreme Court New South Wales Medium Neutral Citation: Lam v Rolls Royce PLC [2013] NSWSC 805 Hearing dates: 7 June 2013 Decision date: 19 June 2013 Jurisdiction: Common Law Before: Beech-Jones J Decision: Subpoena set aside in part. Catchwords: SUBPOENA - REPRESENTATIVE PROCEEDINGS - class action arising out of engine failure in flight - subpoena to airline for passenger manifest - whether subpoena premature - need to facilitate cheap and quick disposal of proceedings. Legislation Cited: Civil Procedure Act 2005 Federal Court of Australia Act 1976 (Cth) Cases Cited: - Bright v Femcare Ltd [2000] FCA 1344 - Trade Practices Commission v CC (NSW) Pty Ltd (No 4) (1995) 58 FCR 426 Category: Interlocutory applications Parties: Sandy Lam (Plaintiff) Rolls Royce PLC Reg No 4706930 (Defendant) Qantas Airways Limited (Applicant) Representation: Counsel: J.E. Rowe (Plaintiff) N.E. Chen (Defendant) M.A. Izzo (Applicant) Solicitors: LHD Lawyers (Plaintiff) Holman Fenwick Willan (Defendant) Minter Ellison (Applicant) File Number(s): 2013/037342 Judgment 1On 7 June 2013 I heard an application by Qantas Airways Limited ("Qantas") to set aside a subpoena issued at the request of the plaintiff. The subpoena seeks production, inter alia, of a passenger manifest for flight QF 32 which departed from Changi Airport in Singapore bound for Sydney on 4 November 2010 (the "flight"). This is a representative action and the subpoena had been issued at an early stage of the proceedings. Qantas' application was supported by the defendant, Rolls Royce PLC ("Rolls Royce"). 2For the reasons set out below, I decline to set aside that part of the subpoena that requires production of the passenger manifest, although one part of the subpoena will be varied and other parts will be set aside. Background 3On 6 February 2013 a statement of claim was filed in this Court naming Sandy Lam as the plaintiff and Rolls Royce as the defendant. It alleges that, some time after the departure of the flight from Changi Airport, the airbus suffered a "catastrophic failure of its number two engine". It is pleaded that the airbus returned to Changi with a disabled engine, "multiple systems failure and escaping aviation fuel". It further pleads that Rolls Royce was responsible for the design and manufacture of the engine and the engine failure occurred because there was "fatigue cracking in a stub pipe ... that fed oil into a high pressure/intermediate pressure bearing structure". Rolls Royce is alleged to have been negligent in the manufacture, inspection and installation of that pipe. Various particulars of negligence are supplied. 4The statement of claim also pleads that Ms Lam suffered loss and damage as a result of Rolls Royce's negligence. A statement of particulars of her injuries has also been filed which implicitly asserts that, as a consequence of the alleged incident, she has suffered "Post-Traumatic Stress Disorder" and a "Major Depressive Disorder". 5The statement of claim indicates that the plaintiff has commenced a "representative proceeding" as contemplated by Part 10 of the Civil Procedure Act 2005 ("CPA"). It identifies what are said to be common questions of law and fact. Paragraph 15 of the statement of claim defines the relevant "group members" as being "all persons on the aircraft who suffered psychological injury as a result of the engine failure". Paragraph 5 of the statement of claim asserts that there were 469 persons aboard the flight. Thus, the maximum size of the group is 469. 6At the hearing of this notice of motion I was advised by counsel for the plaintiff that seventeen persons had already been identified as members of the defined class. 7The proceedings were first returnable before the Court on 16 May 2013. They were referred to me for case management. There was some debate about the content of a foreign law notice that had been served on behalf of the plaintiff. In the end result I made various directions concerning that notice, the provision of further particulars of the statement of claim, and adjourned the proceedings for further directions on 30 July 2013. No directions were made at that time for the filing of a defence. Part 10 of the Civil Procedure Act 2005 8It is necessary to note briefly certain aspects of the scheme for representative proceedings established by Part 10 of the CPA. Part 10 adopts the "opt out" procedure for group actions and is based on the scheme found in Part IVA of the Federal Court of Australia Act 1976 (Cth). 9Where seven or more persons have claims against the same person in respect of or arising out of the same, similar or related circumstances, and those claims give rise to a substantial common question of law or fact, s 157 of the CPA permits the commencement of "proceedings ... by one or more of those persons as representing some or all of them". If the proceedings continue the Court ultimately determines various questions of law, of fact or concerning the form of relief to grant (s 177(1)). The effect of that determination is provided for in s 179 as follows: "A judgment given in representative proceedings: a) must describe or otherwise identify the group members who will be affected by it, and b) binds all such persons other than any person who has opted out of the proceedings under Section162." 10Subsection 162(1) obliges the Court to fix a date by which a group member may opt out of representative proceedings. A group member may opt out by giving written notice of their election to do so (s 162(2)). Section 175 specifies that group members must be given notice of their right to opt out as well as various other steps that arise from time to time in the course of the representative proceedings. Section 176 provides that the form of the content of the notices referred to in s 175, which includes the opt out notice under s 162, "must be approved by the Court". It further provides: "(2) The Court must, by order, specify: (a) who is to give the notice, and (b) the way in which the notice is to be given. (3) An order under subsection (2) may also include provision: (a) directing a party to provide information relevant to the giving of the notice, and (b) relating to the costs of giving notice. (4) An order under subsection (2) may require that notice be given by means of press advertisement, radio or television broadcast, or by any other means. (5) The Court may not order that notice be given personally to each group member unless it is satisfied that it is reasonably practicable, and not unduly expensive, to do so. (6) A notice that concerns a matter for which the Court's leave or approval is required must specify the period within which a group member or other person may apply to the Court, or take some other step, in relation to the matter. (7) A notice that includes or concerns conditions must specify the conditions and the period, if any, for compliance. (8) The failure of a group member to receive or respond to a notice does not affect a step taken, an order made, or a judgment given, in any proceedings." 11It should also be noted that s 166 contemplates the Court ordering the discontinuance of proceedings as representative proceedings under Part 10 because: "(a) the costs that would be incurred if the proceedings were to continue as representative proceedings are likely to exceed the costs that would be incurred if each group member conducted a separate proceeding, or (b) all the relief sought can be obtained by means of proceedings other than representative proceedings under this Part, or (c) the representative proceedings will not provide an efficient and effective means of dealing with the claims of group members, or (d) a representative party is not able to adequately represent the interests of the group members, or (e) it is otherwise inappropriate that the claims be pursued by means of representative proceedings." The subpoena 12On or about 10 April 2013 the plaintiff caused to be issued out of this Court a subpoena directed to Qantas seeking production of the following: "In respect [of the flight]: i) The passenger manifest; ii) Details of each passenger travelling on QF32 including the name, address and telephone number for each passenger; iii) Copies of all reports filed by Qantas Airways Limited in Federal Court of Australia, Proceedings Plaint No: NSD1681/2010 - Qantas Airways Limited v Rolls Royce PLC; iv) Copies of all letters of instruction to experts/authors of reports filed by Qantas Airways Limited in Federal Court of Australia Proceedings Plaint No: NSD1681/2010 - Qantas Airways Limited v Rolls Royce PLC." (emphasis in original) 13After the issue of the subpoena, there was a significant amount of correspondence between the legal representatives for Qantas and the plaintiff. It is unnecessary to describe that correspondence other than to note that Qantas raised its obligations to protect the privacy of the passengers and crew on its own flight. Before me, Qantas accepted that that was not a basis for resisting compulsory production to the Court by way of a subpoena. 14One aspect of the subpoena can be dealt with immediately. Counsel for Qantas, Mr Izzo, stated that there was only one document that answered subparagraph 1(iii) of the schedule to the subpoena, being a report filed in the Federal Court proceedings concerning the content of English law. Upon this being stated, counsel for the plaintiff, Mr Rowe, accepted that if that was the topic of the only report filed, then he could not point to any relevant connection between subparagraph 1(iii) and 1(iv) of the schedule and the subject matter of these proceedings. It follows from that concession that I will set aside subparagraphs 1(iii) and (iv) of the schedule to the subpoena. 15In relation to the passenger manifest and passenger contact details, Mr Izzo submitted that the plaintiff's application to obtain that material was wholly premature. He noted that, as the proceedings involve an opt out procedure, the consent of any person to be a group member is not required. It was submitted that the procedures contemplated by ss 162, 175 and 176, to which I have referred, allow the Court at a suitable point in the future to make the appropriate orders for the notification of the entirety of the class of group members and the manner in which that notification is to occur. Thus it was submitted that, until that point is reached, there is no valid reason to give the plaintiff the means of contacting the potential class members now. He submitted that the prematurity of the subpoena is reinforced by the power the Court has under s 166 to order the discontinuance of the proceedings as a representative action. If Rolls Royce were to successfully invoke that provision, then it was said that there would be no utility in the plaintiff having the contact details for the remaining passengers and crew on the flight. 16Finally, it was submitted that the issue of a subpoena in these circumstances amounts to a form of "fishing expedition" in the sense that it allows the plaintiff to have access to documents, namely the manifest, to ascertain "whether a case exists, as distinct from the purpose of compelling the production of documents where there is already some evidence that a case exists" (see the discussion in Trade Practices Commission v CC (NSW) Pty Ltd (No 4) (1995) 58 FCR 426 at 438 per Lindgren J). Mr Izzo submitted that if the plaintiff "doesn't know there are other people who have suffered psychiatric harm or any sort of harm and what the extent of that harm might be he doesn't even have the beginnings of a cause of action in negligence". 17Mr Rowe submitted that obtaining early access to a list of persons who comprise the outer limits of the group was justified on ostensibly pragmatic grounds. He stated that, given the nature of the flight, it is anticipated that those persons are spread around Australia or perhaps "all over the world". If the task of contacting those people, ascertaining whether they fall or might fall within the group as described and determining whether they in fact wish to participate in the proceedings or opt out, would take a significant amount of time, he said that the earlier the task was undertaken the better. He also suggested that, if there are to be discussions about settlement, then the earlier that the metes and bounds of the class can be ascertained, the more likely that could be facilitated. Consideration 18Each of the provisions in Part 10 of the CPA is to be read consistently with the enjoinder in s 56(1) of the CPA, namely, that civil proceedings should be conducted in a manner that "facilitates the just, quick and cheap resolution of the real issues in the proceedings". It can be expected that no two representative proceedings will be the same. In particular, the potential size and geographical dispersement of each group will vary from case to case. In this case, one potentially unusual feature of the group is that the maximum number of persons within it are known, namely, the number of passengers and crew on the flight. A further feature of the group is, as Mr Rowe submitted, the real likelihood that that relatively small group of people will be geographically dispersed at least across the country, and potentially around the world. In addition, it is known that there is at least one single piece of paper which lists all their names, namely, the manifest. 19The provision of the passenger manifest and such contact details as are available will enable the solicitors for the plaintiff to commence work on contacting all those persons who might fall within the class as described. This will allow them to, inter alia, ascertain which of them have or may have suffered a psychiatric injury and provide an early indication of how many of them, if any, wish to continue to be part of the proceedings or opt out. The manner in which the class has been defined, namely, by reference to those who have suffered psychiatric injury, may become the subject of some debate. At present it seems to me that there are strong reasons for enabling the plaintiff to make efforts to make individual contact with as many potential class members as possible, so that they can ascertain as best they can how many persons in fact fall within the proposed class and who they are. 20This will enable the various steps involved in the progress of the representative proceedings to be undertaken more efficiently. Thus, if and when the Court comes to consider the form, content and manner of service of opt out notices, it will be able to calibrate those matters by reference to what the plaintiff's solicitors have identified as to the likely size and geographical distribution of the class members. For example, it seems to me that requiring the publication of an opt out notice by television or radio, etc., for a class that is no bigger than 469 persons would be a waste of resources. Instead if, by the time the form of opt out notice comes to be considered, it is known that the plaintiff has established contact with say three-quarters of the possible members of the class, then attention could then be focused on the means of contacting the remainder (as well as the form of notice to be sent to all). 21Similarly, if Rolls Royce were to apply under s 166 for the discontinuance of proceedings as a representative action, then it may be relevant to the exercise of any discretion that may arise to know as much as possible about the actual size of the class in order to determine how many individual claims are possible or likely in the event that power is exercised. 22As I have stated, Mr Rowe also submitted that the pursuit of any settlement discussions can commence that much sooner if more is known about the size and make-up of the relevant class. Not surprisingly, Rolls Royce did not embrace that as a consideration warranting the production of the documents. I would not necessarily allow information of this kind to be obtained at such an early stage of the proceedings solely for that reason but, in my view, when taken together with the other matters that I have noted, it reinforces my conclusion that the objectives stated in s 56 of the CPA would be promoted by access to the passenger manifest being granted. 23I have noted above Mr Izzo's submission that the subpoena amounts to no more than a "fishing expedition", in that the plaintiff does not know at this point whether there are any persons on the flight who did or may have suffered psychological injury other than the seventeen persons that I have already referred to. I do not accept that the various descriptions of what constitutes a "fishing expedition" in relation to the production of documents are apposite to these circumstances. In a sense the entire concept of an opt out representative action involves a form of "fishing", in that very often the plaintiff will commence a proceedings on their own behalf and on behalf of others not necessarily knowing how many are in the class as defined, much less their identity or whether they have a reasonable or an arguable case. In my view the obtainment of details from the passenger manifest facilitates those matters being ascertained earlier and more cheaply. 24Mr Izzo also referred to the decision of Lehane J in Bright v Femcare Ltd [2000] FCA 1344. Those proceedings involved a class action arising out of an item of medical equipment known as the "Filshie clip system". A subpoena was issued to a number of hospitals requiring the production of a vast number of documents concerning the use of that item which included "lists of patients who underwent Filshie clip sterilisation operations at the hospital and who were recalled to the hospital with regard to the sterilisation procedure which they had undergone" (at [4]). In striking out various parts of the subpoena, including that part, his Honour stated (at [11]): "But the propositions relied on are propositions which, though generally true, are not necessarily, in my view, universally so. It should not, I think, come as a surprise if, in a novel class of case, there are matters which must be taken into account when considering whether a subpoena should be set aside which do not ordinarily arise in more conventional litigation. Thus, in this case the applicant has commenced a proceeding under the Pt IVA of the Federal Court of Australia Act 1976 (Cth) on behalf of what may be a great number of women, the identity of most of whom is unknown, who have undergone sterilisation procedures. Defences have not yet been filed; motions seeking orders under s 33N of the Act have been foreshadowed; and opt out notices have not yet been given. In those circumstances, in my opinion, it is highly unlikely that the Court would countenance the disclosure of information, not only of a confidential but also of a very personal kind, concerning women, some - perhaps many - of whom ultimately, for one reason or another, may not be represented by the applicant in this proceeding." 25The first sentence in this extract reinforces the point I have made above (at [23]), to the effect that in cases such as this there are matters to be taken into account which do not arise in conventional litigation. Otherwise the balance of the paragraph emphasises the need to consider each case individually. In that case the female patients in question were to be subject to a very significant intrusion into the privacy of their medical records in circumstances where the proceedings were at an early stage, and many of those women were unlikely to be represented by the plaintiff in those proceedings. In this case I accept that the material sought to be obtained from Qantas is private to the persons concerned, but the proposed degree of intrusion is far less than that which would have occurred in Bright. That much lesser degree of intrusion, and the strong likelihood that the production of the material will enhance the objectives listed in s 56, favour the production of the material. 26As I have stated, Rolls Royce appeared on the application to set aside the subpoena. It supported Qantas' application. It further submitted that, if production was ordered, the Court should restrain the solicitors for the plaintiff from contacting the persons named and that, in effect, the Court should supervise all communications between them and the persons named in the manifest. I do not propose to take that course. I expect that the initial communications between the plaintiff's solicitors and the persons named will be in the nature of correspondence between solicitor and prospective client. No reason at this point has been demonstrated for interfering with the confidential nature of that communication. If the proceedings continue as a representative action, then at some point the Court will supervise the manner in which each member, and perhaps potential member, will be notified of their right to opt out. 27Finally I should note that, in the event that production was ordered, Qantas took objection to the form of subparagraph 1(ii) of the schedule. As I understand the position, it was accepted that if production was to be ordered, subparagraph 1(ii) should be amended to read "[i]n respect of each such passenger named in the passenger manifest, the most recent document created between the time of booking on flight QF32 and 4 May 2011 recording the name, address and telephone number of such passenger". 28In relation to costs, on the substantive matter debated between the parties the plaintiff has been successful, although part of its subpoena will be set aside and another part redrawn. In those circumstances, my present view is that Qantas should pay half of the plaintiff's costs of its motion. I will not make that order at present, but if either party wishes to submit to the contrary, then they should email to my Associate and serve on the other party a written submission to that effect, such submission not to exceed two pages on or before 22 June 2013. 29Accordingly the Court orders that: (1)Subparagraphs 1(iii) and (iv) of the schedule to the subpoena issued by the plaintiff to Qantas Airways Limited on 10 April 2013 be set aside. (2)Subparagraph 1(ii) of the schedule to the subpoena issued by the plaintiff to Qantas Airways Limited on 10 April 2013 be varied to read "[i]n respect of each such passenger named in the passenger manifest, the most recent document created between the time of booking on flight QF32 and 4 May 2011 recording the name, address and telephone number of such passenger". (3)The notice of motion filed on behalf of Qantas Airways Limited on 31 May 2013 be otherwise dismissed. (4)The subpoena issued by the plaintiff to Qantas Airways Limited on 10 April 2013, as varied by these orders, be returnable before a Registrar of this Court on 2 July 2013 at 9.00am. (5)Extend time for compliance by Qantas Airways Limited with the subpoena issued by the plaintiff to Qantas Airways Limited to 2 July 2013. (6)Direct that any submissions concerning the costs of the notice of motion filed on behalf of Qantas Airways Limited on 31 May 2013 be sent to the Associate to Beech-Jones J and served on or before 22 June 2013, such submission not to exceed two pages. (7)Liberty to apply to Beech-Jones J on two days notice. 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: 19 June 2013