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Supreme Court of New South Wales |
COURT
IN THE SUPREME COURT OF NEW SOUTH WALES
COURT OF APPEAL
CLARKE(1) MEAGHER(2) HANDLEY(3) JJA
HRNG
SYDNEY, 16 June 1994
#DATE
9:3:1995
#ADD 30:8:1995
Counsel for the Appellant: B Toomey QC and A Quinlivan
Solicitor for the Appellant:
Turner Freeman
Counsel for the Respondent: M J Joseph
Solicitor for the Respondent: Watkins Tapsell and Nolan
ORDER
Orders made.
JUDGE1
CLARKE JA: The claimants for leave to appeal (I will call them the appellants)
are members of a firm
of solicitors known as Turner Freeman who are
experienced practitioners in common law damages actions and workers'
compensation claims.
One partner, Armando John Gardiman, has the overall
supervision, care and conduct of all asbestos disease and latent injury cases
within the firm. He is, therefore, a very experienced practitioner before the
Dust Diseases Tribunal and, in particular, has represented
many claimants who
have suffered from asbestos related diseases.
2. The opponent, Wilfried Hanoldt, was, in 1994, the plaintiff
in proceedings
in which he claimed damages against Qantas Airways Limited upon the ground
that he was suffering from mesothelioma
as a consequence of Qantas's
negligence. Ms solicitor was Mr Andrew Hartcher, of the firm of Watkins,
Tapsell and Nolan, who has
sworn an affidavit in which he said that he had
never previously conducted a matter in the Dust Diseases Tribunal.
3. During the
course of interlocutory proceedings in the case of Hanoldt v
Qantas Airways Limited the respondent served a subpoena upon the appellants
requiring the production of a number of documents which will be described in
more detail below. The response of the appellants was
to move to set the
subpoena aside on a number of grounds. That application was heard by Judge
Johns who, on 18 May 1994, set aside
part of the subpoena but required
production of the documents referred to in Annexure "A" of the subpoena as
PX32, PX33, PX34 and
PX38. The appellants immediately sought leave to appeal
from that judgment and the court, because the substantive hearing in the
respondent's claim was due to be held very shortly, heard argument both on the
application for leave to appeal and the appeal itself
At the end of the
hearing the court ordered that leave to appeal be granted, that the appeal be
upheld and that the subpoena, insofar
as it required production of the
documents previously mentioned, be set aside. The court then reserved its
reasons. I now publish
the reasons which led me to conclude that the subpoena
should be set aside.
Facts
4. The documents of which production was ordered
were as follows:
(1) Exhibit PX32 - Report of Mr Boris Osman dated 26 March 1991;
(2) Exhibit PX3 3 - Report of Mr Osman
in Barker v Siddons Pro
Line Limited dated 26.5.92.
(3) Exhibit PX34 - Report of Mr P Deary dated 15.5.91
(4) Exhibit
PX3 8 - Exhibits Z1-Z20 in Phillips v C C Victoria Pty
Ltd and Ors No DDT98/1990.
5. As I earlier indicated the subpoena was
far more wide reaching. It sought
the production of many documents and did so in terms which in my view almost
certainly rendered
the subpoena oppressive. In order to overcome this problem
the respondent restricted his claim for compliance with the subpoena to
the
stipulated documents. I mention this fact solely to indicate that the parties
joined issue before Judge Johns and this Court
only upon the requirement that
the abovementioned documents be supplied. In particular no argument was put to
either court that in
view of the wide reach of the subpoena it should be set
aside as oppressive without further enquiry.
6. Some further description
of the four classes of documents is necessary. I
take it from the affidavit of Mr Gardiman which was relied upon both before
Judge
Johns and this Court. It read, relevantly, as follows:
"13. Exhibit PX32 is a report of Mr Osman in proceedings Ellul v
Norton
Pty Limited. The report is a specific report prepared by Mr
Osman, commissioned by Turner Freeman on behalf of Ellul who was
an employee of the Second Defendant who worked as a machine
operator emptying bags of raw amosite fibre into the mixing
machine that used to manufacture "Proofkote". Ellul was employed
by Norton Pty Limited within a short period of time after
Preston
(to whom I shall refer later) ceased employment and worked with
Norton for a number of years. The report is specific
to Ellul's
working conditions with Norton Pty Limited. It is not a report
directed to the working conditions of brake lining
workers either
in the manufacture of brake linings or in the removal and repair
of brake linings.
14. Exhibit PX3 3
is a report of Mr Osman prepared in the
proceedings of Barker v Siddons Pro Line Limited on behalf of
Barker at the specific
request of Turner Freeman solicitors.
Barker was employed as a courier and sales person by a series of
large scale suppliers
of wide ranges of engineering and other
products including products containing asbestos. Those products
did not include brake
linings. They did include asbestos rope,
asbestos gloves and asbestos meal and similar products.
15. Exhibit PX34 was a
report prepared by Peter Deary in Urner v
LNC Industries Pty Limited and Ors at the specific request of
Turner Freeman. Peter
Deary is an English expert. In the Urner
proceedings three large English manufacturers of brake linings and
suppliers of
brake linings were sued. One of those companies was
Ferodo Limited which as earlier referred to entered into a joint
venture
agreement with James Hardie and Coy Pty Limited that lead
to the incorporation of Jsekarb Pty Limited (to whom I will later
refer). The report deals generally with the question of knowledge
in English industry with relevance to the brake lining industry
in
particular and contains numerous specific references to matters
solely applicable to England. The report also touches
upon some of
the known Australian literature which has been referred to on
numerous occasions by other experts before the
Dust Diseases
Tribunal of New South Wales including Dr David Kilpatrick and Dr
Maurice Joseph. Extensive objections were
taken to large portions
of the report and substantial portions were deleted. The document
ultimately tendered was various
portions of the Deary report that
were ruled to be applicable to the Preston proceedings.
18. Exhibit PX38 upon enquiry
of the Dust Diseases Tribunal
Registry does not form part of the Rule 4 material. The transcript
of evidence given by Dr
David Kilpatrick and Dr Maurice Joseph in
the Phillips proceedings is however part of the Rule 4 material
and is again available
to the Plaintiff's solicitors upon request
and upon payment by the Plaintiff's solicitors of the appropriate
fee.
In
para 21 further reference was made to PX38. There it was said:
"21. Exhibits PX37, PX38, PX39 and PX40 and the surrounding
transcript material together with a vast quantity of other general
material all of which forms part of the Dust Diseases Tribunal
Rule 4 library is all available at the Registry of the Dust
Diseases Tribunal of New South Wales upon simple request and
upon
payment of the applicable fee. I am informed and do verily believe
that upon payment of an amount of $250.00 the entirety
of the
Tribunal's Rule 4 library will become available to the Plaintiff's
current solicitors. Upon enquiry of the staff of
the Dust Diseases
Tribunal I am informed and do verily believe that the Plaintiff's
current solicitors have sought access
to the Turner Freeman
exhibits specified as exhibits PX16 and PX42 inclusive in the
Preston proceedings but seemingly have
not sought to avail
themselves of Rule 4 material which includes most of what is
sought in the subpoena and that is readily
available from the
Registry of the Dust Diseases Tribunal. A simple enquiry either by
telephone or in person of Mr Ponza
would have revealed this to the
solicitors for the plaintiff. It is clear that they have not made
the relevant enquiry given
the contents of their letter to Turner
Freeman dated 15 April 1994."
7. None of this material throws much light on the nature
of the documents in
PX38. Neither does the judgment but they were described in the summons for
leave.
8. That description was
not, however, in evidence before Judge Johns and, as
counsel for the respondent opposed reliance upon it, the court has disregarded
it. In consequence there is no evidence which provides any description of the
documents. In those circumstances it is difficult to
understand how it could
have been suggested that they had any possible relevance to the issues in the
respondent's case. But an examination
of the judgment under appeal makes it
clear that the argument before Judge Johns proceeded upon the basis that the
documents were
"an accumulation of expert reports and scientific material" by
the appellants, in some instances at the cost of litigants who had
retained
them. The judgment also reveals that the appellants relied on the unfairness
of allowing an unconnected litigant to take
advantage of their labours,
particularly as the same, or similar, material could have been obtained by the
respondent's solicitors
in the ordinary preparation of the case.
9. Reference has been made to Preston. For a number of years in the 1950's he
had been
employed by Norton Pty Ltd in the capacity of a storeman and during
the course of that employment was required to handle asbestos
and asbestos
products. He later brought proceedings against Norton. Preston also sued
Jsekarb Pty Limited as manufacturer and supplier
of brake linings upon which
Preston had to carry out work from time to time. According to the judgment
under appeal the documents
described in paragraphs 13, 14, 15 and 18 were
tendered in the case of Preston v Jsekarb Pty Limited and withdrawn upon its
completion.
The judgment proceeds:
"It was confirmed, however by Mr Letcher QC for the applicant,
that the documents described above
in Mr Gardiman's affidavit were
tendered in the following cases: PX32 in Ellul v Norton Pty Ltd
DDT68/89, PX3 3 in Barker
v Siddons Pro Line Limited DDT103/90;
PX34 in Urner v LNC Industries Pty Limited and Ors DDT52/90 and
PX3 8 in Phillips v
C C Victoria Pty Ltd and Ors DDT98/90."
10. Although the judgment is expressed in that way it seems clear that there
are two distinct
categories of documents involved. The first includes the
first three sets of documents (ie PX32, PX33 and PX34) which were initially
tendered in the proceedings in respect of which they had been secured and
later tendered in the Preston proceedings and the second
encompassed the PX38
documents which were first gathered together for the Phillips case. I should
also mention, for ease of understanding,
that the respondent's case was,
according to Mr Hartcher, a brake linings case.
11. There are a number of references to Rule 4
(of the Dust Diseases Tribunal
Act 1989) in Mr Gardiman's affidavit and it is appropriate to set it out. It
reads:
"Historical and general medical evidence concerning
dust exposure
and dust diseases which have been admitted in any proceedings
before the Tribunal may, with leave of the Tribunal,
be received
as evidence in any other proceedings before the Tribunal whether
or not the proceedings are between the same
parties."
(Material of this nature, the evidence makes clear, is available from the
Tribunal's library.)
The Judgment
12. Judge
Johns concluded that the production of the documents would not be
excessively burdensome nor would it impose such an obligation as
is placed on
a party required to give discovery of documents. He thought it was conceivable
that the documents may have some relevance
to the pending proceedings in the
light of Rule 4 and he concluded that "the fact that these documents may or
may not be available from the Dust Diseases Tribunal Registry is not
a
sufficient reason to excuse the applicants from producing the documents to the
Tribunal in response to a subpoena served upon them".
13. In his opinion the real issue involved "a balance of the rights of Turner
Freeman and their clients and the object of Rule 4" - Would the purpose or
intent of Rule 4 be defeated by setting the subpoena aside? Ms Honour clearly
thought it would because of his conclusion that the documents should
be
produced.
The Submissions
14. Before Judge Johns the appellant submitted that the subpoena should be
set aside upon the grounds
that it was issued for improper purposes or, to put
it another way, involved a misuse of the Tribunal's process. Before this Court
the appellants sought also to put an argument based on the asserted
confidentiality of the documents. An objection was taken to this
argument by
the respondent upon the ground that the point was never taken in the court
below. In view of the conclusion I have reached
on the substantive ground
argued it is not necessary to rule upon this objection or to express a
concluded view upon the submission.
I should indicate, however, that, as at
present advised, I do not think that the submissions have any substance.
15. The issue
of substance which was debated before the Court was whether, in
the light of Rule 4, solicitors for litigants could be required to produce, in
answer to a subpoena, documents which had come into existence for specific
proceedings and clients (and which had been tendered in those proceedings) in
later proceedings with which neither they nor their
clients were concerned. I
should mention again that there is a vast quantity of general material
relating to asbestosis held by the
Dust Diseases Tribunal Rule 4 library and
that this material is available upon simple request and upon payment of the
applicable fee.
Reasons
16. The power
of a court to issue a subpoena for the production of documents
for service on a person, whether a party or a stranger to the litigation,
is
an important facility for the just disposal of disputes between persons before
the court. Its importance lies in the fact that
documentary evidence which may
be highly relevant may not be available to the court unless produced under the
compulsion of an order
of the court.
17. Obviously the recipient of a subpoena to produce documents may be put to
a great deal of trouble and cost in
complying with the subpoena. That fact
does not on its own provide any excuse for the recipient failing to comply
with the subpoena
and, unless it is set aside or some valid ground is
established for declining to produce the documents, the recipient who declines
to comply with the subpoena is guilty of contempt of court and is liable to be
punished by attachment or fine.
18. The court will,
however, be astute to ensure that its coercive powers to
require the production of documents are not misused or abused. Where a court
concludes that the power has been misused by a party the court will, on the
application of the recipient of the subpoena or even
its own motion, set it
aside as an abuse of process. That the courts are empowered to act in this
manner has not been doubted. Nor
could it be in the light of a consistent line
of authority (Raymond v Tapson (1882) 22 Ch D 430, at 435; The Commissioner
for Railways v Small, 38 SR 564, at 573; NEM Ltd v Waind and Hill (1978) 1
NSWLR 372, at 382; Botany Bay Instrumentation and Control Pty Ltd v Stewart
(1984) 3 NSWLR 98, at 101).
19. It is true that specific examples of abuses of the power appear in both
Small and Waind but there is no basis for
the argument propounded by counsel
for the respondent that unless a case falls within the four comers of one, at
least, of the examples
given in those cases a subpoena cannot be set aside as
an abuse of process. In neither of these cases is it suggested that there
could not be other instances of an abuse. On the contrary Moffitt P (in Waind,
at 382) made it clear that there may be ways other
than those he discusses in
which a subpoena may constitute an abuse and he emphasised the importance of
respecting the private rights
of a stranger to the litigation.
20. In Morgan v Morgan (1977) Fam 712 the court held that it would be
oppressive to require the father of a litigant in family law proceedings to
give evidence about his
private affairs and dismissed an appeal against the
setting aside of a subpoena. It was accepted that the evidence of the witness
would have been relevant but the court balanced that fact against the
oppressiveness of requiring a person to give evidence about
his private
affairs.
21. It is unnecessary for present purposes to decide whether Morgan was
rightly decided but it stands as
an example of the manner in which the courts
pay regard to the private rights of the recipient of subpoenas. (See also
Hunter v Chief
Constable of the West Midlands Police and Ors [1981] UKHL 13; (1982) AC 529, at
536.)
22. What the appellants say in this case is that the documents the production
of which is sought and which fall within
the first category are reports
produced at the cost of the particular litigant for use in specific litigation
to which they had direct
relevance and that they could have no possible
relevance to different litigation between different parties.
23. Alternatively,
if, in the light of Rule 4, they could be said possibly to
have some relevance to the present proceedings that relevance was so slight as
to be outweighed in
a proper balancing exercise by the private rights of the
client (on whose behalf the solicitor held the documents) and the solicitor
so
that it should be concluded it would be oppressive to require production of
the documents.
24. Insofar as the second category
is concerned they are documents which can
be obtained in public libraries but which have been collected together by the
appellants
into a bundle of documents relevant to, and for use in, litigation
involving asbestos related illness as is conducted by the appellants.
Their
submission is that while the respondent's solicitor can secure access to, and
get copies of each of the documents from public
sources, it is an abuse of the
coercive power to secure the production of documents on subpoena to seek to
secure the fruits of the
appellants' labours by this method.
25. The answer that is given in both cases is that the documents are, or may
be, relevant
to the issues in the litigation, that they are not privileged (a
matter which the court has assumed in the absence of argument) and
that the
fact they were secured for other litigation provides no basis for the setting
aside of the subpoena. The respondent added
that any suggestion that the
documents are private or privileged is unsustainable in the light of the fact
that they were also tendered
in the Preston litigation.
26. In my opinion it is not a proper use of the coercive powers of the court
to seek to obtain in the
circumstances of this case the production of
documents brought into existence for specific litigation at the cost of the
litigant
for use in other, unassociated, litigation between different parties
and presumably, involving completely different factual issues.
The highest
that the respondent can put its case is that the material may bear some
relevance to the issue concerning the knowledge
that the defendant had, or
ought to have had, of the dangers of asbestos at varying periods of time. No
doubt if the respondent wished
to obtain the views of Mr Osman or Mr Neary on
the subject he could have retained them as experts but, as it seems to me, it
is not
a proper use of court process to endeavour to obtain access to their
views in the manner adopted in this case. The procedure was,
in my opinion,
quite irregular.
27. The trial judge regarded the question facing him as involving a balancing
exercise between
the proper functioning of rule 4 and the rights of the
appellants and their clients. With the greatest of respect I believe he asked
himself the wrong question.
28. Rule 4 is, in my opinion, an eminently sensible rule designed to assist
litigants in the presentation of evidentiary material bearing on
what may
often be an important question as to the state of knowledge of problems
related to asbestos within the community, or overseas,
in the past. If it is
properly used it provides an applicant for compensation with an avenue for
proof of facts, on issues on which
he or she bears the onus, in a manner both
less costly and time consuming than the normal procedures. It is a fine
example of the
constructive use of a rule making power and its use is, clearly
enough, to be encouraged. I should add that there could be no question
of
injustice in the reception, without cross-examination, of historical material
because the material is only admissible with leave
of the court.
29. The rule is not, however, concerned with the coercive powers of the court
to require litigants and other persons
to produce documents to the court. In
particular it does not alter or extend, either expressly or impliedly, the
function of a subpoena
to produce documents. The power to require the
production of documents remains unaltered. The rule enables the parties to
tender
the documents to which reference is made but cannot be construed as
transforming an improper use of the coercive powers of a subpoena
into a
proper one.
30. The respondent sought to explain the procedure adopted upon the grounds
that his solicitor was inexperienced
in the particular field of litigation.
That provides no reason for adopting the role of a parasite and feeding from
the table of
expert solicitors. One may well doubt the wisdom of a novice
accepting a retainer in what is, undoubtedly, a difficult area of litigation
but if the challenge is accepted he or she is bound by the same rules as the
expert. Furthermore, there is (at least there was) an
advice on evidence, a
ready avenue of assistance to solicitors whether they are experienced or not,
who are preparing an action for
trial. I say this merely to emphasise that the
inexperience of the solicitor is totally irrelevant.
31. The novelty of the present
circumstances probably lies in the fact that
evidentiary material unconnected with the litigation in question would, in
general,
be totally irrelevant to, and inadmissible in, the litigation.
Accordingly, there would be no occasion to require the production
of documents
of the category of those the subject of the present subpoena. Any attempt to
subpoena them would probably be rebuffed,
initially at least, on the grounds
of obvious irrelevance. Rule 4 changes that insofar as it provides a possible
basis of argument on relevance but, as I have sought to point out, it does not
extend
the court's coercive powers. Although I would always support legitimate
attempts to limit the cost of proceedings it is clear to
me that this case
stands as an example of an unjustified invasion of the private rights of
persons unconnected with the litigation.
32. The position is the same concerning the second category. During the
hearing Handley JA referred to a passage in an article
on "Discovery of
Documents" which appeared in 107 Law Quarterly Review 370. At 372 it was said,
in a slightly different context:
"If a party's solicitor can secure useful material, not by his own
efforts,
but simply by raiding that secured by the solicitor for
the opposing party, then neither will have much incentive to
individual
diligence in gathering together such material, at least
before the trial. As Maguire once said' ... we must not let the
drones
sponge upon the busy bees. Otherwise it would not be long
before all lawyers became drones.' (Evidence: Common Sense and
Common Law (1947) at p 91)"
33. That is entirely apt and while it expresses no principle of law it is
good sense. Solicitors should
not, as a general rule, be permitted to secure
by subpoena the fruits of the labour of other solicitors, thereby avoiding the
necessity
to undertake for themselves the burden of securing evidence for
presentation at a trial, particularly where there is a readily available
source which involves the invasion of no-ones rights.
34. There is, it seems to me minimal, or no, public interest in requiring
that the appellants comply with the subpoena. On the other hand there are
strong arguments against compliance based on the invasion
of private fights
and a public interest that solicitors carry out their work diligently without
fear that the products of their endeavours
will become available to any other
practitioners who seek to secure them.
35. This need to maintain the privacy of a solicitor's
work was expressed in
the context of discovery in Hickman v Taylor [1947] USSC 5; (1946) 329 US 495, at 510, in
which it was said:
"... simply an attempt without purported necessity or
justification, to secure written statements,
private memoranda and
personal recollections prepared or formed by an adverse party's
counsel in the course of his legal
duties. As such it falls
outside the arena of discovery and contravenes the public policy
underlying the orderly prosecution
and defence of legal claims.
Not even the most liberal of discovery theories can justify
unwarranted inquiries into the files
and the mental impressions of
an attorney.
Historically, a lawyer is an officer of the court and is bound to
work for
the advancement of justice while faithfully protecting
the rightful interests of his clients. In performing his various
duties,
however, it is essential that a lawyer work with a certain
degree of privacy, free from unnecessary intrusion by opposing
parties and their counsel. Proper preparation of a client's case
demands that he assemble information, sift what he considers
to be
the relevant from the irrelevant facts, prepare his legal theories
and plan his strategy without undue and needless
interference.
That is the historical and the necessary way in which lawyers act
within the framework of our system of jurisprudence
to promote
justice and to protect their clients' interests. This work is
reflected, of course, in interviews statements,
memoranda,
correspondence, briefs, mental impressions, personal beliefs, and
countless other tangible and intangible ways
- aptly though
roughly termed by the Circuit Court of Appeals in this case as the
'work product of the lawyer'. Were such
materials open to opposing
counsel on mere demand, much of what is now put down in writing
would remain unwritten. An attorney's
thoughts, heretofore
inviolate, would not be his own. Inefficiency, unfairness and
sharp practices would inevitably develop
in the giving of legal
advice and in the preparation of cases for trial. The effect on
the legal profession would be demoralising.
And the interest of
the clients and the cause of justice would be poorly served.
We do not mean to say that all written
materials obtained or
prepared by an adversary's counsel with an eye towards litigation
are necessarily free from discovery
in all cases. Where relevant
and non-privileged facts remain hidden in an attorney's file and
where production of those facts
is essential to the preparation of
one's case, discovery may properly be had. Such written statements
and documents might,
under certain circumstances, be admissible in
evidence or give clues as to the existence or location of relevant
facts. Or
they might be useful for purposes of impeachment or
corroboration. And production might be justified where the
witnesses
are no longer available or can be reached only with
difficulty. Where production of written statements and documents
to be
precluded under such circumstances, the liberal ideals of
the deposition-discovery portions of the Federal Rules of Civil
Procedure would be stripped of much of their meaning. But the
general policy against invading the privacy of an attorney's
course of preparation is so well recognised and so essential to an
orderly working of our system of legal procedure that a
burden
rests on the one would invade that privacy to establish adequate
reasons to justify production through a subpoena
or court order.
That burden, we believe, is necessarily implicit in the rules as
now constituted."
36. This passage illustrates
what I seek to convey when referring to a public
interest protecting the work of solicitors, in particular circumstances, from
discovery
or rendering it amenable to production on subpoena.
37. In my opinion the subpoena was an abuse of process and for that reason
I
concurred in the order proposed.
JUDGE2
MEAGHER JA: I agree with Clarke JA.
JUDGE3
HANDLEY JA: I agree with Clarke JA.
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