Supreme Court New South Wales Medium Neutral Citation: Provident Capital Ltd v Kharadjian [2014] NSWSC 1490 Hearing dates: 10/10/2014 Decision date: 10 October 2014 Jurisdiction: Common Law Before: Garling J Decision: With respect to the Notice of Motion dated 26 September 2014, I make the following orders: (1) The Notice to Produce for Inspection served by the second and third defendants on the plaintiff on 18 September 2014 be set aside. (2) I order the second and third defendants to pay the plaintiffs' costs of and incidental to the Notice of Motion With respect to the Notice of Motion dated 3 October 2014, I make the following orders: (1) I order that the Notice to Produce for Inspection served by the second and third defendants on the plaintiff on 29 September 2014 be set aside. (2) I order that each party pay its and their own costs of the Motion. With respect to the second Notice of Motion dated 3 October 2014, I make the following orders: (1) I order that the Notice of Motion filed by the solicitor for the plaintiff on 3 October 2014 with respect to legal professional privilege be dismissed. (2) I order the second and third defendants to pay the plaintiffs' costs of and incidental to the Motion. With respect to the proceedings generally, I will make the following directions: (1) I order Mr Lazar, the cross-defendant to the Second Cross-Claim, to file and serve a defence to the Second Cross-Claim on or before 31 October 2014. (2) I grant leave to each of the defendants to file and serve any amended Defence and any amended First Cross-Claim by 4pm, 24 October 2014. (3) I reserve to the plaintiff the right to raise, on the next occasion the matter is before the Court, any objection to any of the amendments which are contained in such amended documents. (4) I order the defendants to pay the plaintiffs' costs of and occasioned by any amendment to the documents. (5) I order the first defendant to pay the costs of the plaintiff of the directions hearing of 12 September 2014. Catchwords: PROCEDURE - civil - interlocutory issues - notices to produce for inspection - challenges to claims for privilege - consent orders - no point of general principle Legislation Cited: Civil Procedure Rules 2005 Category: Interlocutory applications Parties: Provident Capital Limited ACN 082 735 573 (Receivers And Managers Appointed) (In Liquidation) (P) George Kharadjian (D1) Stella Kharadjian (D2) John Kharadjian (D3) Representation: Counsel: J Hynes (P) G A Moore (D1) G Thomas (D2, D3) Solicitors: Henry Davis York (P) Jordan Djundja Lawyers (D1) Shore Stack Lawyers (D2, D3) File Number(s): 2010/80304 EX TEMPORE JUDGMENT 1These are applications for costs in respect of three Notices of Motion in the context that the parties have agreed on the other orders to be made with respect to the Motions. Notice of Motion of 26 September 2014 2The first Notice of Motion was filed on 26 September 2014 by the plaintiff seeking to set aside a Notice to Produce which was served on 18 September 2014. That Notice to Produce purported to be issued under r 21.10 of the Uniform Civil Procedure Rules 2005 ("UCPR"). It is agreed between the parties that the Notice to Produce ought be set aside. The Notice to Produce was defective in my view because it was issued under Pt 21 of the UCPR rather than under Pt 34. 3On 25 September 2014, the solicitors for the plaintiff communicated that the solicitors for the first and second cross-claimants had issued the Notice to Produce, pointing out that the Notice was defective in that it did not seek specific documents of the kind which Pt 21 requires. 4In the absence of any timely response acknowledging that the Notice of Motion was filed, the parties have now agreed that the Notice to Produce should be set aside. In my view, the Notice of Motion was not properly issued. It could not have been enforced, it was issued under the wrong rule, and the point taken about its validity and adequacy by the solicitors or the plaintiff was correctly taken. There was no timely response to that which necessitated the filing of the Notice of Motion. The Notice of Motion was consequently filed. The first and second cross-claimants now accept that the order in the Notice of Motion should be made. I see no reason why costs should not follow the event. 5With respect to the Notice of Motion dated 26 September 2014, I make the following orders: (1)The Notice to Produce for inspection served by the second and third defendants on the plaintiff on 18 September 2014 be set aside. (2)I order the second and third defendants to pay the plaintiffs' costs of and incidental to the Notice of Motion. Notice of Motion of 3 October 2014 6On 3 October 2014, a Notice of Motion was issued by the solicitors for the plaintiff with respect to a further Notice to Produce served on the plaintiff by the solicitor for the second and third defendants. It is now agreed that the Notice to Produce should be set aside. The Notice to Produce called for the production of the transcript of examinations of Mr Michael O'Sullivan which had occurred in the Federal Court of Australia pursuant to orders of that Court, dealing with the affairs of a specified corporation. 7The Notice to Produce having been served was responded to by an email at 3.14pm on Friday 3 October 2014 by the solicitor for the plaintiff in which it was asserted that the Notice was unenforceable on the following bases: first, that the transcripts which were being sought were irrelevant to the current proceedings; second, the transcripts had not been signed by the examinees and did not form a part of any Court record; third, that the examination was conducted in private, and confidentiality orders were made with respect to the records of examination which confidentiality orders were still in place, and fourth, that the documents which were sought would, in any event, be subject to a claim for legal professional privilege. 8The first two grounds on which it was protested that the Notice would be set aside are, in my view, erroneous. In my view, the transcript of the examination of Mr O'Sullivan can, on the basis of what I know of these proceedings, from reading the pleadings and from what I have been told at various directions hearings, be regarded as relevant to the facts in issue. 9In any event, the question of relevance is not a basis of itself for suggesting a notice is unenforceable. Rather, it is a reason for the Court to decline to enforce the Notice if it is otherwise satisfied that the documents produced in accordance with it are irrelevant. Second, the fact that the transcript had not been signed is irrelevant because there was no order made by the Federal Court that the transcripts of the examinations be signed. 10The third basis for the objection was that the examination was conducted in private, and confidentiality orders of the Federal Court remained in place which precluded the production of the transcripts. I regard that as a sound ground for resisting the Notice to Produce. Fourth, the ground of legal professional privilege is not a matter which I have had to deal with, and I make no comment on it because the documents have not been produced. 11Accordingly, the solicitor for the plaintiff was correct to draw the solicitor for the second and third defendants' attention to the fact that the plaintiff was unable to comply with the Notice to Produce. However, the present Notice of Motion was filed within a very short time after that email was sent, and certainly within a time which did not permit the consideration of the response by the solicitors for the second and third defendants before the Motion was filed and served. 12I accept that the solicitor for the plaintiff was motivated to file the Motion so as to enable it to be returnable this morning, but that fact simply means that the email calling for a response should have been sent at an earlier point in time. After all, the Notice to Produce was first served on 29 September 2014, and there was a sufficient period for a much earlier response. 13In all of those circumstances, in my view, the appropriate order is that, with respect to costs, is that each party pay their own costs of that Motion. 14With respect to this Motion of 3 October 2014, I make the following orders: (1)I order that the Notice to Produce for inspection served by the second and third defendants on the plaintiff on 29 September 2014 be set aside. (2)I order that each party pay its and their own costs of the Motion. Notice of Motion of 3 October 2014 15The third Motion was also filed on 3 October 2014 and sought to challenge a claim of privilege being made by the second and third defendants with respect to documents produced under subpoena by a solicitor, Mr Alexander Ronayne. Most of the documents were made available last night, with some redactions because privilege is no longer being claimed with respect to them with the exception of a portion of one of the documents, which has been redacted. 16It is accepted that the Notice of Motion ought now be dismissed but the plaintiffs submit that they should have their costs of the Motion because the claim for privilege was maintained up until last night, and only foregone by the provision of the documents including one redacted paragraph to the solicitors for the plaintiff last night. 17In my view, the plaintiff has had a significant measure of success with respect to the Motion, and although the Motion is to be dismissed, it is appropriate that the second and third defendants, who are the respondents of that Motion, pay the plaintiffs' costs of the Notice of Motion. 18With respect to that Notice of Motion on 3 October 2014, I make the following orders: (1)I order that the Notice of Motion filed by the solicitor for the plaintiff on 3 October 2014 with respect to legal professional privilege be dismissed. (2)I order the second and third defendants to pay the plaintiffs' costs of and incidental to the Motion. 19With respect to the proceedings generally, I will make the following directions: (1)I order Mr Lazar, the cross-defendant to the second cross-claim, to file and serve a defence to the Second Cross-Claim on or before 31 October 2014. (2)I grant leave to each of the defendants to file and serve any amended Defence and any amended First Cross-claim by 4pm, 24 October 2014. (3)I reserve to the plaintiff the right to raise, on the next occasion the matter is before the Court, any objection to any of the amendments which are contained in such amended documents. (4)I order the defendants to pay the plaintiffs' costs of an occasion by any amendment to the documents. (5)I order the first defendant to pay the costs of the plaintiff of the directions hearing of 12 September 2014. ********** 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: 30 October 2014