Federal Court of Australia

Treasury Wine Estates Limited v Maurice Blackburn Pty Ltd [2020] FCAFC 226

ORDERS

THE COURT ORDERS THAT:

1.    Leave be granted to the appellant to rely on the further evidence being the redacted version of the defence to counter-claim at annexure AM-26 to the affidavit of Alan Mitchell affirmed 9 October 2020.

2.    Leave be granted to the first and second respondents to file and serve a notice of contention, such notice to be filed and served within 7 days of the making of these orders.

3.    The appeal be dismissed.

4.    The appellant pay the respondents’ costs of the appeal, as agreed or taxed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

THE COURT:

The appeal

1    This appeal concerns the obligation on a person not to use a document or information for any purpose other than the proceeding, where the person knows that the document or information was obtained because another party to the proceeding disclosed the document or information under compulsion (be it by court order, a rule of court, or otherwise): Harman v Secretary of State for the Home Department [1983] 1 AC 280 as applied in Hearne v Street [2008] HCA 36; (2008) 235 CLR 125. In these reasons, the obligation is referred to as the Hearne v Street obligation. The primary judge held that the obligation did not apply to the relevant documents or information in this case and that, if it did apply, the respondents should be released from the obligation and granted leave nunc pro tunc to use the documents or information for the purpose for which they had used them: Jones v Treasury Wine Estates Limited; In the Matter of Treasury Wine Estates Limited (No 4) [2020] FCA 1131; (2020) 146 ACSR 302.

2    The documents in question are the third further amended statement of claim (Jones 3 FASOC) and the second further amended defence (Jones 2 FAD) filed in proceeding NSD 660 of 2014, Jones v Treasury Wine Estates (the Jones proceeding). As noted below, these documents contained information which had been obtained under compulsion. The Jones proceeding was a class action against Treasury Wine Estates (TWE) in which Mr Jones and others sought compensation for contraventions of the Corporations Act 2001 (Cth), the Australian Securities and Investments Commission Act 2001 (Cth) and State legislation proscribing misleading and deceptive conduct by TWE’s non-disclosure of information about its earnings between 17 August 2012 and 14 July 2013.

3    The first and third respondents, Maurice Blackburn Pty Ltd (MB) and Guy Donnellan, were the solicitors and counsel respectively for Mr Jones in the Jones proceeding. The Jones 3 FASOC and Jones 2 FAD were prepared on the basis of, amongst other things, documents TWE was required to discover in the Jones proceeding including TWE’s US distribution agreements and documents disclosing that over 50% of TWE’s US sales derived from three key US distributors, TWE’s US stock levels, TWE’s management of its US stock levels, and TWE’s business practices in dealing with its US distributors.

4    The Jones 3 FASOC and Jones 2 FAD were published on the Court’s website in September 2017 pursuant to an order of the Court dated 17 September 2017 which required (in order 3) the publication of a notice which, amongst other things, stated that:

Full details of the allegations made by the plaintiff and TWE’s defence against those allegations are set out in the Third Further Amended Statement of Claim and Second Further Amended Defence which may be inspected at each District Registry of the Federal Court of Australia, and on its website.

5    The Jones 3 FASOC and Jones 2 FAD remain available to the public to inspect on the Court’s website.

6    The Jones proceeding was settled on 10 November 2017 and orders were made dismissing that proceeding on 10 August 2018.

7    MB and Mr Donnellan were then retained as the lawyers in another class action against the same respondent, TWE, being Napier v Treasury Wine Estates, which commenced on 1 May 2020 in the Supreme Court of Victoria (the Napier proceeding). The Napier proceeding is also an investor class action against TWE relying to some extent on the same facts as the Jones proceeding but alleging loss to shareholders who purchased shares in TWE from 30 June 2018 to 28 January 2020.

8    MB obtained the Jones 3 FASOC and Jones 2 FAD from the Court’s website using Google as a search engine. MB and Mr Donnellan used the Jones 3 FASOC and Jones 2 FAD obtained from the Court’s website to prepare the statement of claim in the Napier proceeding (Napier SOC).

9    TWE contended that, in using the Jones 3 FASOC and Jones 2 FAD obtained from the Court’s website to prepare the Napier SOC, MB and Mr Donnellan breached the Hearne v Street obligation. The Napier proceeding was stayed as a result of this allegation and the respondents applied to this Court by interlocutory applications for declarations that the obligation did not apply to the relevant parts of the Jones 3 FASOC and Jones 2 FAD or the relevant information in those pleadings or, to the extent necessary, orders releasing them from the obligation and granting them leave to use the documents and information in question for the purpose of the Napier proceeding. As noted, the primary judge decided in favour of the respondents and made orders accordingly.

10    According to TWE, there is no dispute that the Hearne v Street obligation applies to information derived from discovered documents. The Jones 3 FASOC and Jones 2 FAD contained information derived from TWE’s discovered documents. The primary judge erred in holding that the Hearne v Street obligation ceased on public disclosure of the documents. MB and Mr Donnellan, being the lawyers retained in the Jones proceeding, are in a position of special advantage in relation to documents filed in that proceeding. They could not use the Jones 3 FASOC and Jones 2 FAD for the collateral purpose of preparing the Napier SOC without first obtaining the leave of this Court, which they did not do. The publication of the Jones 3 FASOC and Jones 2 FAD on the Court’s website does not affect that obligation as it applies to MB and Mr Donnellan. TWE also contended that the primary judge denied them procedural fairness by hearing the respondents’ applications for release from the obligation and leave to use the information from the Jones 3 FASOC and Jones 2 FAD for the purpose of the Napier proceeding on 24 June 2020 rather than adjourning the hearing for three business days so that TWE could adduce evidence of a further breach of the obligation by the first and second respondents arising from the filing by Mr Napier in the Napier proceeding of a defence to a counter-claim filed by TWE alleging breach of confidence relating to information other than that the subject of the Hearne v Street obligation. TWE also contended that the primary judge erred in the exercise of his discretion in releasing the respondents from the obligation and granting them leave to use the information from the Jones 3 FASOC and Jones 2 FAD for the purpose of the Napier proceeding.

11    TWE otherwise contended that:

(1)    it is immaterial that r 2.32(c) of the Federal Court Rules 2011 (Cth) (the FC Rules) provides that any person may inspect a pleading in the proper Registry of the Court – the Hearne v Street obligation continues to bind the lawyers in the Jones proceeding notwithstanding that a stranger to that proceeding will not be so bound;

(2)    it is immaterial that the second further amended statement of claim in the Jones proceeding (Jones 2 FASOC), which is in materially the same terms as the Jones 3 FASOC, was received into evidence in the Jones proceeding. According to the majority in Harman, as adopted in Hearne v Street, the obligation continues even after a document has been received into evidence. In any event, the Jones 3 FASOC and Jones 2 FAD were never themselves received into evidence;

(3)    r 20.03 of the FC Rules, on which the respondents seek leave to rely (the provision not having been raised before the primary judge), does not exclude the Hearne v Street obligation in respect of documents received into evidence. Rule 20.03 provides:

(1)    If a document is read or referred to in open court in a way that discloses its contents, any express order or implied undertaking not to use the document except in relation to a particular proceeding no longer applies.

(2)    However, a party, or a person to whom the document belongs, may apply to the Court for an order that the order or undertaking continue to apply to the document.

On its terms, r 20.03(1) does not apply for two reasons. One, it applies to “the” document which is the Jones 2 FASOC alone. It does not apply to another document or documents (being the Jones 3 FASOC and Jones 2 FAD) merely because it is (or they are) in materially the same terms as “the” document. Two, r 20.03(1) applies only to a document which is “read or referred to in open court in a way that discloses its contents”. It is clear that the qualifying phrase “in open court in a way that discloses its contents” applies to both “read” and “referred”. Otherwise, the reference to “read” makes no sense. There is no suggestion that Jones 2 FASOC (let alone the Jones 3 FASOC and Jones 2 FAD) was read or referred to in open court in a way that discloses its contents;

(4)    this Court should not, in the re-exercise of discretion, release the respondents from the Hearne v Street obligation or grant them leave to use the information in the Jones 3 FASOC and Jones 2 FAD for the purpose of the Napier proceeding in circumstances where:

(a)    the first and second respondents had knowingly committed another breach of the obligation in preparing the defence to counter-claim in the Napier proceeding (evidence of which should be admitted in the appeal);

(b)    none of the respondents had apologised for the breach or breaches; and

(c)    none of the respondents had offered to pay compensation to TWE for the breach or breaches including the payment of TWE’s costs of the proceeding on an indemnity basis before the primary judge and the appeal;

(5)    TWE does not require leave to appeal against interlocutory orders because s 24(1C)(b) of the Federal Court of Australia Act 1976 (Cth) (the FC Act) provides that leave is not required for an appeal from an interlocutory judgment “in proceedings relating to contempt of the Court or any other court”. A breach of the Hearne v Street obligation is a contempt of court. Accordingly, the proceeding before the primary judge is a proceeding “relating to contempt of the Court”; and

(6)    alternatively, if leave to appeal is required, it should be granted as the decision of the primary judge is attended by sufficient doubt to warrant its reconsideration by a Full Court and TWE will suffer substantial injustice if leave is refused as, by reason of the breaches of the Hearne v Street obligation, TWE has become exposed to and will continue to incur costs and inconvenience associated with certain claims in the Napier proceeding.

12    The respondents contended that the appeal is incompetent as the orders of the primary judge are interlocutory and it cannot be said that the proceeding before the primary judge related to a contempt of the Court, as no orders for contempt were sought. Section 24(1C)(b), accordingly, does not operate and leave is required under s 24(1A) of the FC Act. Leave should not be granted as there is no substantial injustice to TWE supposing the primary judge’s decision to be wrong. The effect of TWE’s argument is that any person in the world other than MB and Mr Donnellan was and is free to use the Jones 3 FASOC and Jones 2 FAD for any purpose including for the purpose of the Napier proceeding. Further, to the extent that the appeal involves an appeal against the primary judge’s refusal to grant an adjournment (grounds 6 and 7), the appeal is incompetent by operation of s 24(1AA)(b)(ii) of the FC Act. In any event, the respondents contended that the primary judge made no error. The Jones 3 FASOC and Jones 2 FAD are not documents discovered by TWE in the Jones proceeding. MB and Mr Donnellan did not use any document discovered by TWE in the Jones proceeding to prepare the Napier SOC. They used the publicly available copies of the Jones 3 FASOC and Jones 2 FAD from the Court’s website. The Hearne v Street obligation does not apply to those publicly available documents. Nor does it apply to pleadings. Further, any such obligation came to an end when the Jones 2 FASOC, in the same terms as the Jones 3 FASOC, was received into evidence and/or the Jones 3 FASOC and Jones 2 FAD were published on the Court’s website.

13    As noted, the Napier proceeding has been stayed pending the resolution of the dispute in this Court. Accordingly, resolution of the dispute with some expedition has been necessary.

14    We have concluded that:

(1)    leave to appeal is not required;

(2)    if leave to appeal is required, leave to appeal should be granted;

(3)    ground 6 of the appeal is not incompetent, but ground 7 is incompetent;

(4)    the primary judge did not deny TWE procedural fairness;

(5)    the primary judge made no error in concluding that MB and Mr Donnellan (and thus the second respondent, their client) were not bound by the Hearne v Street obligation in respect of the Jones 3 FASOC and Jones 2 FAD;

(6)    accordingly, the appeal should be dismissed;

(7)    if we are incorrect in this regard, TWE should be granted leave to rely on the further evidence in the appeal;

(8)    the primary judge did not err in the exercise of his discretion by making the orders for release from the Hearne v Street obligation and granting leave to the respondents to use the Jones 3 FASOC and Jones 2 FAD for the purpose of the Napier proceeding. In any event, if it were necessary for this Court to decide the question of release from the obligation and leave to use the documents for the purpose of the Napier proceeding we would reach the same conclusion as the primary judge, albeit in some respects for different reasons. In particular, and contrary to TWE’s apparent assumption, the respondents were not seeking to purge a contempt. They were seeking orders which, if granted, meant that there was no (and never has been) any contempt to purge. Accordingly, the facts stressed by TWE, that the respondents have not apologised and offered to pay TWE’s costs on an indemnity basis and compensation, are not material in the particular circumstances of this case. Rather, a critical factor in the particular circumstances of this case is whether the respondents would have obtained the orders now sought had they applied in advance of the (alleged but non-existent) breach; and

(9)    if it had been necessary to do so, in the circumstances of this case we would have ordered that the respondents be released from the Hearne v Street obligation and granted leave to use the information in the Jones 3 FASOC and Jones 2 FAD for the purpose of the Napier proceeding nunc pro tunc.

15    Our reasons follow.

Leave to appeal (issue (1))

16    There is no dispute between the parties that if the proceeding before the primary judge is not “proceedings relating to contempt of the Court or any other court” as provided for in s 24(1C)(b) of the FC Act then leave to appeal against the primary judge’s orders, which are interlocutory orders, is required under s 24(1A) of the FC Act. There is also no dispute that a breach of the Hearne v Street obligation constitutes a contempt: Harman at 305, Hearne v Street at [109].

17    TWE submitted that if, as TWE alleged, the respondents had breached their Hearne v Street obligations, then they are in contempt of this Court and s 24(1C)(b) applies. According to TWE the words “relating to” have an extremely wide meaning: Project Blue Sky v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 at [87], Bull v R [2000] HCA 24; (2000) 201 CLR 443 at [96]. Further, provisions which vest jurisdiction in courts are not to be confined other than by the express words of the provision: Owners of Ship Shin Kobe Maru v Empire Shipping Co Inc [1994] HCA 54; (1994) 181 CLR 404 at 421 and the authorities cited in Lees v Connective Services Pty Ltd [2019] VSCA 143; (2019) 346 FLR 323 at [85]-[95]. Section 24(1C)(a), in contrast to s 24(1C)(b), does not use the words “relating to” and therefore cases dealing with s 24(1C)(a) are immaterial.

18    The respondents submitted that the purpose of s 24(1C)(b) is to ensure that any person found guilty of contempt has an automatic right of appeal. This is consistent with the approach taken to s 24(1C)(a) (giving a right of appeal against an interlocutory judgment affecting the liberty of an individual). That exception from the requirement for leave has been narrowly construed to apply only to orders which subject a person to direct incarceration or total deprivation of the person’s physical liberty: Talacko v Talacko [2010] FCA 239; (2010) 183 FCR 297 at [43], Gao v Fair Work Ombudsman [2013] FCA 754 at [18], and SZSNN v Minister for Immigration and Border Protection [2013] FCA 1218; (2013) 217 FCR 171 at [23]-[26]. In the present case there was no charge or finding of contempt. The proceeding before the primary judge concerned the anterior issues of whether the Hearne v Street obligation applied to the relevant documents at all and, if it did apply, whether the respondents should be released from the obligation and granted leave to use the information in the Jones 3 FASOC and Jones 2 FAD for the purpose of the Napier proceeding, in effect, retrospectively.

19    We prefer TWE’s approach to s 24(1C)(b) of the FC Act. Section 24(1C)(b) is not, in terms, confined to proceedings “for” contempt of the Court or any other court. It extends to proceedings “relating to” contempt of the Court or any other court. There is no reason to give the words “relating to” a confined meaning when, in the ordinary course, those words of connection have been consistently held to have a wide meaning. For proceedings to relate to contempt, they need not involve a charge of contempt. They may be proceedings in which a finding of whether or not there has been conduct which amounts to a contempt is essential. In the present case, the respondents sought declarations that they had not breached the Hearne v Street obligation. The primary judge, accordingly, had to find whether or not the respondents had breached the obligation. In so doing, the primary judge was necessarily finding whether or not the respondents had engaged in conduct which amounted to a contempt of this Court (even if, to be found guilty of contempt, the respondents would have to be subject to a charge of contempt, found to be proved to the criminal standard of proof beyond reasonable doubt). These circumstances are sufficient to make the proceeding before the primary judge a proceeding “relating to” contempt of the Court. This construction of s 24(1C)(b) gives effect to the use of the broad words of connection “relating to” in the provision. In our view, it also accords with the likely purpose of the provision which is to ensure that where an issue of conduct amounting to a contempt of court is relevant to the determination of a proceeding (whether or not the proceeding involves a charge of contempt) there is an automatic right of appeal.

20    For these reasons we consider that TWE does not require leave to appeal.

If required, leave should be granted (issue (2))

21    If our conclusion about s 24(1C)(b) is incorrect then, in any event, we would have granted TWE leave to appeal. The respondents’ submission that TWE will not suffer any substantial injustice supposing the primary judge’s decision to be wrong misses the true weight of TWE’s submissions. If TWE is correct then MB and Mr Donnellan were in a position of special advantage with respect to the Jones 3 FASOC and Jones 2 FAD and were not able to use those documents for any purpose other than the Jones proceeding. In using the Jones 3 FASOC and Jones 2 FAD to prepare the Napier SOC, on TWE’s case, MB and Mr Donnellan took advantage of their special position and breached their Hearne v Street obligation. The Napier SOC was prepared as a result of that breach. It is not to the point that any other lawyer not in that position of special advantage in respect of the Jones 3 FASOC and Jones 2 FAD may have prepared a statement of claim in the Napier proceeding using the Jones 3 FASOC and Jones 2 FAD. Such a lawyer would not have been in a position of special advantage with respect to the documents. If the primary judge is wrong about the Hearne v Street obligation not applying then TWE will suffer a substantial injustice. Its opposition to the release of the obligation and the grant of leave nunc pro tunc to use the documents for the purpose of the Napier proceeding will be determined, as it was by the primary judge, on the basis that there has been no breach. This approach put (and would put) TWE at an automatic disadvantage on the questions of release from the obligation, leave to use the documents for the purpose of the Napier proceeding, and costs, as the primary judge’s reasons at [87] disclose (the primary judge said that he had upheld the respondents’ contention that there was no breach in the context of considering the release and leave issues, and that as he had found no breach of the obligation he would not order the respondents to pay TWE’s costs of the application and, instead, ordered TWE to pay the respondents’ costs of the application). This amounts to substantial injustice supposing the primary judge to be wrong. Further, it is not tenable to suggest that the primary judge’s conclusion is not attended by sufficient doubt to justify a grant of leave to appeal. The competing contentions of the parties expose genuinely different approaches and ambiguities in the authorities about the operation of the Hearne v Street obligation.

22    For these reasons, if we are wrong about s 24(1C)(b) of the FC Act applying to this proceeding then we would have granted TWE leave to appeal.

Ground 6 not incompetent but ground 7 incompetent (issue (3))

23    In ground 6 of its appeal TWE contended that the primary judge denied TWE procedural fairness by refusing to adjourn the hearing for three business days, as sought by TWE, in circumstances where there was no urgency and, according to TWE, refusing the adjournment application denied it the opportunity to adduce relevant evidence, being the defence to counter-claim in the Napier proceeding (which TWE contended proves a further breach of the Hearne v Street obligation by the first and second respondents, but not the third respondent). In ground 7 of its appeal TWE contended that the primary judge erred in exercising his discretion not to grant the adjournment by taking into account irrelevant considerations and failing to take into account relevant considerations.

24    The respondents submitted that grounds 6 and 7 are incompetent because s 24(1AA)(b)(ii) of the FC Act provides that an appeal must not be brought from a judgment of the Court constituted by a single Judge exercising the original jurisdiction of the Court if the judgment is a decision to adjourn or not to adjourn the proceeding.

25    In our view, s 24(1AA)(b)(ii) of the FC Act does not apply to ground 6 of the appeal, but does apply to ground 7. Ground 6 is not an appeal against the primary judge’s decision not to adjourn the hearing. It is an appeal against an alleged denial of procedural fairness. The fact that the refusal to grant an adjournment is the source of the alleged denial of procedural fairness does not make this an appeal against the primary judge’s decision not to grant the adjournment. Section 24(1AA)(b)(ii) of the FC Act could not have been intended to immunise from appeal a decision made in breach of the requirements of procedural fairness. A hearing which occurs in breach of the requirements of procedural fairness is no hearing at all. As TWE submitted, the purpose of s 24(1AA)(b) is to prevent appeals on “minor procedural decisions”: Explanatory Memorandum, Access to Justice (Civil Litigation Reforms) Amendment Bill 2009 (Cth) [80]-[82]. Its purpose was not to strip away a right of appeal concerning a fundamental characteristic of a judicial hearing, being procedural fairness.

26    The same conclusion cannot apply to ground 7. Ground 7 is nothing more than a challenge to the primary judge’s decision not to grant an adjournment of the hearing. The fact that it is framed as the primary judge taking into account irrelevant considerations and failing to take into account relevant considerations does not alter the fundamental character of the appeal embodied in ground 7. We also do not consider that the mere fact that ground 7 is but one of TWE’s appeal grounds means that ground 7 does not involve an appeal against a decision not to adjourn a hearing. As such, to the extent that ground 7 is raised in the appeal, it is precluded from being prosecuted by s 24(1AA)(b)(ii) of the FC Act.

27    In any event, insofar as the relevant considerations allegedly not taken into account are concerned it may be said that:

(1)    the primary judge recognised that the evidence which TWE sought the adjournment to obtain was relevant. He was not convinced, however, that TWE had insufficient time to put that evidence before the Court: [101];

(2)    the primary judge was also aware that what TWE sought was an adjournment for a “relatively short time”: [90]. It is immaterial that the primary judge did not expressly identify the period of three business days as the adjournment that TWE sought. It would not be inferred that the primary judge failed to take that matter into account. The primary judge was unwilling to defer the hearing at all, so the length of time for which the adjournment was sought is immaterial; and

(3)    the primary judge took into account the fact of the unavailability of TWE’s senior counsel on 24 June 2020, the day of the hearing. He merely thought that fact was not of much weight which was a matter for the primary judge alone: [97].

28    Insofar as the irrelevant considerations allegedly taken into account are concerned:

(1)    a mistake of fact as to the dates on which the first and second respondents’ senior counsel were available does not involve the taking into account of an irrelevant consideration such as to vitiate the exercise of discretion in refusing an adjournment application. It is a mere mistake of fact. In any event, it is not apparent that the primary judge gave this matter any, let alone determinative, weight: [97]; and

(2)    the primary judge was entitled to take into account his view that senior counsel for the first and second respondents would be required to return their briefs if TWE could tender the defence to counter-claim as evidence of a further breach of the Hearne v Street obligation: [101]. This was not an irrelevant consideration in respect of the adjournment application.

29    It follows that even if we are incorrect about the operation of s 24(1AA)(b)(ii) of the FC Act we would have dismissed ground 7 of TWE’s appeal.

No denial of procedural fairness (issue (4))

30    As noted, ground 6 of the appeal alleges that the primary judge denied TWE procedural fairness by refusing to adjourn the hearing for three business days, as sought by TWE, in circumstances where there was no urgency and, according to TWE, refusing the adjournment application denied it the opportunity to adduce relevant evidence, being the defence to counter-claim in the Napier proceeding.

31    The fact is, however, the primary judge was not “persuaded that TWE had not had sufficient time to bring before the Court the additional evidence which it argued it was being denied the opportunity to tender”: [101]. TWE has not challenged that factual finding as erroneous in the appeal. It has merely asked this Court to reach a different conclusion on the basis of the same material which was before the primary judge (excluding the defence to counter-claim itself which is the further evidence TWE seeks leave to adduce in the appeal). That this is so is apparent from TWE’s submissions in which it records that it brought the same relevant matters to the attention of the primary judge (that it wished to tender the defence to counter-claim as evidence of a further breach of the Hearne v Street obligation but could not do so as it needed an order from the Supreme Court of Victoria to require a redacted version of the defence to counter-claim to be filed to protect TWE’s confidential information and required leave of the Supreme Court of Victoria to tender that defence in this proceeding as otherwise TWE would itself be in breach of the Hearne v Street obligation). TWE records that it informed the primary judge, by evidence from TWE’s lawyer, that TWE could not complete these steps in the time available but “nevertheless, the application [for an adjournment] was denied” by the primary judge. All of this may be accepted. But given the unchallenged finding by the primary judge at [101] that he did not accept that TWE had not had time to enable it to tender the defence to counter-claim before the primary judge, it cannot be said that TWE was deprived of the opportunity to tender that evidence. In the face of this finding of fact, it cannot be concluded that TWE was deprived of a reasonable opportunity to adduce the evidence on which it wished to rely. That is, it cannot be concluded that there was any denial of procedural fairness.

32    The primary judge’s finding, which as we have said TWE did not challenge in the appeal, is not self-evidently in error or, indeed, in error at all given the material which was before the primary judge. The respondents had made competing submissions to the primary judge to the effect that TWE could have tendered the defence to counter-claim before the primary judge. TWE had the defence to counter-claim. TWE could have issued a notice to produce to MB requiring production of the document. The Hearne v Street obligation “must yield…to the requirements of curial process in other litigation”: Esso Australia Resources Ltd v Plowman (1995) 183 CLR 10 at 33; see the discussion in Deputy Commissioner of Taxation v Rennie Produce (Aust) Pty Ltd (in liq) [2018] FCAFC 38; (2018) 260 FCR 272 at [29]-[35]. To alleviate its confidentiality concerns, TWE could have applied to the primary judge for a non-publication order in respect of the confidential parts of the defence to counter-claim. MB suggested these steps to TWE at the time but TWE declined to take them.

33    As noted, TWE has not challenged the primary judge’s factual finding that he was not persuaded that TWE was unable to adduce evidence of the defence to counter-claim. TWE has also not explained in this appeal why we would conclude that finding was in error. On the primary judge’s finding, contrary to TWE’s submissions, it was possible for TWE to put evidence of the defence to counter-claim before the primary judge without undermining TWE’s confidentiality claim in part of the information disclosed in that document. As such, the claim of denial of procedural fairness must fail.

34    The fact that TWE’s lawyer deposed to the fact that it was not possible for it to both prepare for the hearing of the interlocutory applications and apply for a non-publication order from the primary judge in relation to the defence to counter-claim is immaterial. The same evidence was before the primary judge. Plainly, he did not accept that evidence, as his conclusion at [101] makes apparent. He was not bound to accept that evidence.

35    Further, and contrary to TWE’s contentions, there was no denial of procedural fairness in the primary judge deciding, of his own motion, to list the respondents’ interlocutory applications for hearing. The primary judge was not bound to hear from the parties before doing so; the listing of the interlocutory application of MB and Mr Napier (which was filed first) for hearing on 24 June 2020 was a procedural matter for the primary judge. The parties were informed of the listing on 22 June 2020 in the morning, the scheduled hearing date being two days later on 24 June 2020. TWE communicated with the primary judge’s chambers to the effect that it sought an adjournment of the hearing. The primary judge declined TWE’s email request to adjourn the hearing on 23 June 2020. TWE had legal representation at the hearing. But for the capacity to tender the defence to counter-claim TWE does not contend that it was denied an opportunity to be heard. The alleged incapacity to adduce evidence of the defence to counter-claim cannot found a denial of procedural fairness for the reasons given above.

36    Nor does it matter that the primary judge had not been informed that the hearing was urgent. He was entitled to take his own view about the appropriate hearing date. It is equally irrelevant that the primary judge’s decision was not delivered until 6 August 2020. The period for which judgment was reserved does not support the suggestion that the primary judge denied TWE procedural fairness by refusing the adjournment application.

37    Given our conclusions above about the defence to counter-claim above, nothing in the circumstances indicates any denial of procedural fairness to TWE. Ground 6 of the appeal must be rejected.

Hearne v Street obligation (issue (5))

38    Grounds 1, 2, 3 and 4 of the appeal contend that the primary judge erred in concluding that the respondents were not bound by the Hearne v Street obligation in respect of the Jones 3 FASOC and Jones 2 FAD. It is contended that the primary judge erred in concluding that:

(1)    there was a public domain exception to the obligation;

(2)    the obligation did not apply to pleadings;

(3)    the documents were in the public domain for the purpose of the law of confidence so the obligation did not apply; and

(4)    if the obligation applied to the documents, the obligation was spent when the information in the Jones 2 FASOC (containing the same information as the documents) was tendered in evidence.

39    Hearne v Street concerned the question whether a third party who knows that the origin of a document is its filing in legal proceedings under compulsion is bound by the obligation not to use the document for any purpose other than the legal proceedings in which the document was filed. The High Court held that the third party was bound by the obligation in these circumstances. They also held that the conception of the obligation as an implied undertaking of the person to the court was inapt and the requirement should be understood as a substantive obligation. In so concluding, Kirby J referred to the “historical origins of the ‘implied undertaking’ in respect of documents filed in court but not yet tendered or read in evidence”: [46]. Hayne, Heydon and Crennan JJ, at [95]-[96], identified the obligation in these terms:

[95]    Before turning to the appellants’ submissions in relation to the extent and enforceability of the ‘implied undertaking’, it is desirable to set out some background legal principles which were not in controversy.

[96]    Where one party to litigation is compelled, either by reason of a rule of court, or by reason of a specific order of the court, or otherwise, to disclose documents or information, the party obtaining the disclosure cannot, without the leave of the court, use it for any purpose other than that for which it was given unless it is received into evidence.

40    Hayne, Heydon and Crennan JJ, at [138], noted that:

Of course the consequence of filing and serving affidavits and statements in legal proceedings is that one day their contents might become open to the public when read in open court. But it was not illegitimate to seek to ensure that before that time the defendants, Luna Park Sydney Pty Ltd and Metro Edgley Pty Ltd, and persons acting in their interests, did not abuse their access to the documents in employing them for a purpose outside the proceedings.

41    TWE submitted that the qualification in [96] of the joint judgment of Hayne, Heydon and Crennan JJ (“unless it is received into evidence”) needed to be understood as a reference to the applicable rule of the Supreme Court of New South Wales at the time, r 21.7 of the Uniform Civil Procedure Rules 2005 (NSW) (the UCPR) which provided (and still provides):

(1)    No copy of a document, or information from a document, obtained by party A as a result of discovery by party B is to be disclosed or used otherwise than for the purposes of the conduct of the proceedings, except by leave of the court, unless the document has been received into evidence in open court.

(2)    Nothing in subrule (1) affects the power of the court to make an order restricting the disclosure or use of any document, whether or not received into evidence, or the operation of any such order.

42    TWE submitted that this must be so given the High Court in Hearne v Street confirmed the existence of the obligation as discussed in Harman: [1], [2], [97], [105], [107], [109], [124] and [125]. According to TWE, the majority judgments in Harman did not propose any such limitation (indeed, the majority said the obligation continued to apply even if the documents had been received into evidence) or, indeed, any form of public domain exception to the principle. If it were otherwise, submitted TWE, the High Court would have been simultaneously adopting and overturning Harman by stealth.

43    We disagree. The first difficulty is that the High Court does not refer to UCPR 27.1 as qualifying the extent of the obligation in Hearne v Street. The second difficulty is that UCPR 27.1 refers to a document or information from a document obtained as a result of discovery. In Hearne v Street the relevant documents were affidavits which had been filed but not yet adduced into evidence. This explains the observations in the joint judgment at [138] set out above. In other words, UCPR 27.1 would not have applied to the affidavits in any event, yet the High Court still described the obligation as one which ceased on admission of the documents into evidence. Third, and as discussed further below, there was pre-existing authority in Australia which identified the relevant obligation as ceasing when a document is received into evidence. The High Court referred to some of those authorities in Hearne v Street without expressing any disagreement with them. Fourth, the observations of the majority in Harman about the receipt of a document into evidence not causing the obligation to cease were obiter dicta. The fact is that the documents were not received into evidence in Harman; they were merely read aloud in open court. It is not to be assumed that the High Court in Hearne v Street was adopting all of the obiter dicta of the majority in Harman. It was adopting the ratio of Harman which, on analysis, is narrow.

44    It may be accepted that the High Court in Hearne v Street was identifying the obligation as “background legal principles which were not in controversy”. As discussed below, however, in so doing the High Court referred to a number of cases in Australia which identified the obligation in precisely these terms – as one that ceased on the receipt into evidence of a document produced or served under compulsion.

45    Accordingly, and to the contrary of TWE’s submissions, the High Court’s statement of principle in Hearne v Street should be taken to apply in accordance with its terms – the obligation ceases on admission of a document into evidence.

46    In Harman documents had been obtained on discovery. Counsel read them aloud in open court. However, the documents were not admitted into evidence. While judgment was reserved, the solicitor showed the documents to a journalist for a purpose unconnected with making a fair report of the proceeding. The solicitor was found guilty of contempt of court. On appeal to the House of Lords Lord Diplock stressed that the case was not about, amongst other things, documents coming into “the public domain”, but was about an aspect of the law of discovery of documents: 299. The argument put for the solicitor was that once the documents had been read aloud in open court then the obligation not to use the documents for any collateral purpose ceased whether or not the documents were admissible or inadmissible in the trial: 302E. Lord Diplock observed that the solicitor, who possessed copies of the documents because of discovery, had a “great advantage” compared to any other person: 304F. His Lordship said that save as to the gravity of the contempt, no distinction is to be drawn between discovered documents which have and have not been admitted into evidence: 304H. To make use of the “special advantage” obtained by having possession of the documents was a contempt: 304H-305A. Lord Diplock dismissed as hypothetical the example that the solicitor might have shown the journalist a transcript of the hearing with impunity (which would have included counsel reading the documents out loud) but could not show the discovered documents to the journalist: 305C. His Lordship concluded that the obligation not to use a discovered document for any collateral purpose does not end on the document being read out loud in court, whether the document is admissible or not. Lord Keith of Kinkel considered that the fact that a certain degree of publicity in respect of the documents had resulted from them being read out in court did not mean that the obligation had ceased: 308D. His Lordship stressed that the source of the obligation was not the law of confidentiality but the interests of the proper administration of justice: 308G. Lord Keith of Kinkel also rejected the transcript example noting, amongst other things, that it was not to be supposed that the journalist would request such a transcript: 309E. Lord Roskill also described the person to whom discovery was made as at a “great advantage in comparison with the rest of the world”: 322H. Lord Scarman (in the minority with Lord Simon of Glaisdale) held that once “the litigant’s private right to keep his documents to himself has been overtaken by their becoming public knowledge, we can see no reason why the undertaking given when they were confidential should continue to apply to them”: 313C.

47    The following observations may be made about Harman. One, it concerned documents produced under discovery. Two, the solicitor used the documents themselves for a purpose collateral to the proceeding. Three, but for the reading out loud of the documents in open court (where members of the public may or may not have been present), there is no suggestion that the documents had otherwise been disclosed to the public. Four, it appears that the majority assumed that if instead of using the documents themselves, the solicitor had shown the journalist a copy of a transcript of the proceedings, there would have been no breach of the obligation. Five, the documents were not admitted into evidence, so statements about the relevance of that fact are obiter dicta.

48    Crest Homes PLC v Marks [1987] 1 AC 829 also involved discovered documents. The House of Lords said at 854 that the obligation applies not merely to discovered documents but to information derived from those documents whether embodied in a copy or stored in the mind (citing, with approval, Sybron Corporation v Barclays Bank PLC [1985] Ch 299). This statement of principle founds TWE’s submission that the obligation applies to any document that incorporates information from a discovered document, be it a pleading, transcript or otherwise. Crest Homes, however, does not expressly address the issue of the status of a transcript or a pleading. TWE referred to three other decisions in this regard.

49    First, TWE referred to Sybron. Sybron concerned documents produced under subpoena. Some of the documents were referred to by the judge in delivering judgment. Scott J held that such documents must be subject to the same obligation as discovered documents: 318B. His Honour also noted that the obligation must apply not only to the documents themselves but their contents, so that the obligation applies to information from the documents whether embodied in another document or stored in the mind: 318D-E. Accordingly, the persons subject to the obligation (the parties and their privies) could not use a secondary source of the contents of the documents, such as a transcript of a judgment referring to them, for a collateral purpose. Scott J accepted that in Harman it was not said that the solicitor could not have disclosed a transcript of the hearing to the journalist, but considered that principle required that conclusion as the solicitor was in a position different from the public at large including the journalist. Scott J held that the fact that a discovered or subpoenaed document had entered the public domain by being referred to in open court or in a judgment did not relieve the party and the party’s privies from the obligation: 321-322.

50    Second, TWE referred to Forty Two International Pty Limited v Barnes [2010] FCA 397 in which Yates J described the obligation as one which applies generally to documents produced in court proceedings under compulsion and to information derived from those documents, citing, amongst other cases, Sybron: [67]-[72].

51    Third, TWE referred to Connective Services v Slea [2017] VSC 182; (2017) 53 VR 130. Connective Services concerned a discovered document. The discovered document was an agreement: [12]. The agreement was also discovered again in a later proceeding: [13]. The contents of the document were discussed in open court. A transcript of the hearing containing that information was used to commence another proceeding. At the time use was made of the transcript for the collateral purpose of commencing the other proceeding the agreement had not been received into evidence (which it subsequently was). Almond J held that the use of the agreement and transcript involved a breach of the Hearne v Street obligation. Almond J at [29] referred to Hamersley Iron Pty Ltd v Lovell (1998) 19 WAR 316 in which Anderson J at 342 referred to Harman and said that “there is no reason why the fact that a document belonging to a party has been referred to in open court should destroy the private right of that party to prevent the public dissemination of it by the party who has obtained discovery of it”. Pidgeon and Ipp JJ at 320 agreed with Anderson J in the result but reserved their position with respect to the consequences of a discovered document being referred to in open court. Almond J also noted at [31]-[32] in Connective Services that Anderson J in Hamersley Iron at 341 had referred to the statement of Mason CJ in Esso at 32-33 that the obligation is subject to the “qualification that once material is adduced into evidence it becomes part of the public domain unless the court restrains publication of it” and had said that “he did not consider that Mason CJ intended to lay down a new exception in Australia to the rule in Harman, noting that Mason CJ had cited Harman with unqualified approval”. Further, Almond J noted at [33] the observations of the Victorian Court of Appeal in British American Tobacco Australia Services Ltd v Cowell (No 2) [2003] VSCA 43; (2003) 8 VR 571 at [30]-[31] that Mason CJ had not offered any reasoning to “support the introduction of such a general exception to the common law”.

52    After considering the reasoning in Cowell in detail, Almond J said at [37] that the Victorian Court of Appeal followed Harman and held that the marking of the relevant documents as exhibits did not bring the obligation to an end (as discussed below, the documents in Cowell had been admitted into evidence on an interlocutory application, not the substantive proceeding). At [54] in Connective Services Almond J characterised the obiter dicta in Cowell as not going so far as the applicant had submitted (that is, that the obligation does not prevent a party from making use of information contained in a discovered document if there is a secondary source of the information publicly available and the information is derived from that secondary source). Rather, Almond J at [55] described the obiter dicta in Cowell as the expression of an opinion that parties and non-parties alike should be able to make use of what appears in reasons for judgment, and that once a document is copied or quoted in reasons for judgment the parties should be free to make use of that published information (contrary to Sybron). Almond J described the factual circumstances in the case as involving use of a transcript referring to documents in open court during an interlocutory application where the documents being read from had not been tendered into evidence: [57]. Almond J held that the obligation in respect of the documents continued: [52]-[53]. In obiter dicta at [73] Almond J was not satisfied that the statement in Hearne v Street at [96] established that the obligation ceased once a document had been tendered in evidence. For the reasons already given, we are unable to agree with this conclusion. We are also unable to agree with Almond J’s characterisation of the obiter dicta in Cowell. Had Almond J taken what we consider to be the correct view of Esso at 32-33, Hearne v Street at [96] and of Cowell, we doubt that his Honour could have held that the obligation applied to the agreement or a transcript of a hearing not subject to any non-publication order.

53    In Esso the issue was documents produced in an arbitration. Mason CJ stressed the private nature of arbitrations: 26. Mason CJ rejected confidentiality and an implied contractual term as the foundation of an obligation of parties to an arbitration not to disclose the proceedings or information provided in them: 30. Rather, his Honour considered that the implied undertaking which applies in court proceedings not to use any discovered document for a purpose collateral to the proceeding in which discovery was made applied to arbitrations: 33. In that context Mason CJ referred to the “qualification that once material is adduced in evidence in court proceedings it becomes part of the public domain, unless the court restrains publication of it”: 32-33. Dawson and McHugh JJ agreed with Mason CJ: 39 and 48. While obiter dicta, the statement of Mason CJ is neither unreasoned, nor merely in passing. His Honour explained that the rationale for the cessation of the obligation was that once received into evidence, the documents entered the public domain. It is also apparent that Mason CJ’s statement of the principle accords with a line of authority in Australia both before and after Harman: see at [74] below.

54    Accordingly, we are unable to agree with the observations in Cowell at [30]-[31] and Hamersley Iron at [32], as well as in Connective Services, about Mason CJ not having meant what he said in Esso at 32-33. As discussed below, the qualification on the obligation once a document had been received into evidence to which Mason CJ was referring was not a new development in the common law of Australia. It reflects a considered approach to the operation of the principle which had been applied in Australia before and after Harman. This also supports the view that the High Court meant what it said in Hearne v Street.

55    In Cowell the Victorian Court of Appeal considered discovered documents, witness statements and interrogatories. Despite applying Sybron (at [35]), their Honours referred to Scott J’s view in Sybron that a party was not free to make use of a transcript or judgment to the extent they referred to discovered documents and doubted the correctness of this proposition at [28], saying that it:

…seems to us that if the party has available an alternative source of information about the contents of the documents, even a source deriving from the discovery of the documents, then, if that source be public, the party to whom the documents were first discovered should arguably be as free to make use of that alternative source of information as any member of the public undoubtedly is. That would mean that in Harman the solicitor should be regarded as having transgressed because she made free with the documents themselves as distinct from the transcript of what had been said in open court.

56    Their Honours reinforced this view at [33], saying:

…evidence, once given orally in open court, can ordinarily be used subsequently for any lawful purpose without restriction (subject of course to any order made specifically to the contrary in a given case).

57    Their Honours were not convinced, however, that the obligation ceased to exist in respect of documents produced under subpoena and tendered against the party on an interlocutory application: [21] and [35]. At [36] their Honours referred to the nebulous nature of the concept of the “public domain” having regard to the fact that the documents in the case, although tendered in evidence, had not been read aloud in open court. Ultimately, their Honours preferred the view that the obligation continued, not least because it avoided debate about whether the documents had entered the “public domain”: [37]. At [38] their Honours returned to Sybron, saying:

As already mentioned, we do not as yet subscribe to the opinion expressed by Scott J that the parties may not make use of what appears in the judgment; we should have thought that once a document is copied or quoted in the reasons for judgment, its contents to that extent are public knowledge and use can accordingly be made, by party and non-party alike, of what appears in the judgment. That is merely to emphasise the possible difference between the documents themselves and some alternative, albeit derivative, sources of information. But, as with all the other evidence at trial, it will be the parties who are well aware of the special status of the documents provided between them under compulsion and it is only the parties who are affected by the distinction. The party gaining access to another’s documents is properly regarded as in a privileged position by reason of the court’s processes, and it is that privilege which ought not to be abused.

58    Their Honours returned to the issue at [41], saying:

As earlier indicated, we see it as at least strongly arguable that, if it [a discovered document] has become public knowledge in all respects, unlimited use can then be made of it outside the court room on the ground that the party, who must be taken to have given the undertaking, should not then be in any better or worse position than a stranger to the litigation.

59    At [43] their Honours considered further the tender of evidence and distinguished between discovered documents and documents brought into existence for the purpose of the litigation, saying:

… if the witness statement be adopted by the witness in the course of the hearing with the result that it passes into evidence, the implied undertaking - or the duty analogous to the implied undertaking - not to use the statement otherwise than for the purpose of the litigation will arguably have come to an end, for want of any further purpose to be served by maintaining the undertaking. It is much the same with answers to interrogatories. Like answers to interrogatories, the witness statement has been brought into being solely for the purpose of its going into evidence at trial and therefore, once that happens, the undertaking which initially attaches in order to protect it from misuse in the meantime would appear to be spent. It is otherwise with documents provided to an opponent upon discovery or the like, for such documents commonly predate the commencement of the proceeding and ordinarily have not been brought into existence for the purposes of the litigation. Hence the greater need for care to guard against their being used by an opponent for a "collateral or ulterior purpose" even after they have been marked as exhibits in the proceeding in which they were made available.

60    At [46] their Honours also distinguished between documents produced for the purpose of the litigation and tendered in evidence other than for the purpose for which they were produced (such as in an interlocutory application). At [47] they said:

For present purposes, suffice it say that the use of a document on an interlocutory proceeding may not always be as significant as its use at trial and in our opinion that was so in relation to both the answers to interrogatories and the witness statement here in question: both have yet to be used on the trial of the issues arising in the plaintiff's action for damages and so meanwhile both remain subject to the implied undertaking despite their going into evidence on the interlocutory application.

61    At [48]-[50] their Honours said:

[48]    For these reasons, it may be concluded as follows. Where documents are provided to a party to litigation under some coercive process of the court with the result that an implied undertaking attaches to the effect that, without the leave of the court, they not be used otherwise than for the purposes of the litigation, the party bound by that undertaking is not freed of it simply because the document in question is marked as an exhibit in the proceeding in the course of which it was provided. To the extent that knowledge of the document has become public by dint of its tender in open court, members of the public will be free to make use of that knowledge as they will (subject always of course to any order specially made protecting confidentiality and the like), but the party affected by the undertaking remains bound as to use of the document itself. The distinction seems to us a valid one between, on the one hand, use of the document the contents and probably the provenance of which are known in detail to the party by virtue of a privilege extended to it by the processes of the court and, on the other hand, use of the information about it which comes to the knowledge of the public by reason of the proceedings in open court (and during which, it may be supposed, the document is marked as an exhibit). The knowledge of the one cannot be equated with the knowledge of the other.

[49]    Given the particular considerations requiring that a party's privacy be respected so far as compatible with the administration of justice in open court, there seems no logical, or indeed practical, reason why the mere passing of the document into evidence (as witness its being marked as an exhibit) should be taken to relieve the party bound by the implied undertaking from its obligations in that respect. Arguably at least, it would be different if that party was seeking not to make use of the document itself, but to use only the information about it of which the public had become aware (or which, to use another phrase, had passed into "the public domain") by reason of its use in open court. We include in this last the use of a transcript of the proceedings in court or judgment delivered in which reference is made by counsel, the witness or the judge to the document in question. As to information which is thereby made known generally to the public at large - but only as to such information - there may well be no reason to distinguish between the position of the party bound by an undertaking as to the document itself and the position of any stranger to the litigation. But that is not this case.

[50]    The foregoing applies in particular to documents provided to an opponent as the result of discovery, subpoena duces tecum or the like, documents which for the most part will have come into existence well before the commencement of the proceeding in which they are made available and generally without thought to their being required at some stage in evidence. It is otherwise with the witness statement of Dr Seiden, Exhibit P51, and the answers to interrogatories, Exhibit P45, for these were brought into existence specifically for use in the proceeding between the appellant and the respondent and their being made public at the trial of the proceeding was to be expected. That does not mean that the witness statement and the answers to interrogatories were not the subject of the implied undertaking when first provided by the appellant to its opponent; for they were, by reason of the circumstances of their creation. It may, however, mean, if (as we have suggested) the undertaking is properly regarded as intended to provide protection only pending their use at trial, that once put in evidence at trial everyone, parties and members of the public alike, are free to make whatever use they choose of the contents of such documents. But here the witness statement of Dr. Seiden and the answers to interrogatories did not cease to be subject to the implied undertaking by reason of their going into evidence because, even if that would have resulted from the tender of such documents at trial, in this instance they were tendered only on an interlocutory application and then for a purpose other than that for which they were brought into being.

62    There is no doubt that the observations of the Victorian Court of Appeal about the “public domain” referred to above are obiter dicta. The Court of Appeal also endorsed Harman and, albeit with some qualifications, Sybron, in particular with respect to the distinction between a party and its privies and a stranger to litigation. It also seems fair to say, however, that the result in Cowell depended on their Honours’ view that the documents, although tendered in evidence, remained private to the party who had discovered them.

63    TWE contended that the primary judge erred by following Cowell at [70]. The primary judge said at [70], referring to Connective Services at [54]-[62], that:

It seems to me that the reasoning of Almond J in the above paragraphs of Connective and of Scott J in Sybron relied upon by Almond J is contrary to the observations of the Victorian Court of Appeal in Cowell at 583 [28] and 588 [38] to the effect that the Hearne v Street obligation does not prevent a party from making use of information contained in a discovered document if there is a secondary source of the information publicly available and the information is derived from that secondary source. For this reason, I consider that I am bound to follow Cowell on this point and propose to do so. In any event, with respect to Almond J, I think that his opinion to the contrary does not state the law in Australia.

64    TWE submitted that in Cowell the Court mentioned in passing two possible common law exceptions to the Hearne v Street obligations. First, information incorporated in reasons for judgment: [38]. Second, a discovered document which passes into the public domain by reason of its use in open court: [49]. According to TWE, however, as Cowell applied the majority view in Harman the second potential exception must be distinct from the notion of the “public domain” for the law of confidence. Thus, the Court in Cowell must be taken to have accepted that the obligation continues to apply to discovered documents exhibited to an affidavit and read in open court as per Harman, Hamersley Iron, Citicorp Life Insurance Ltd v Lubransky [2005] VSC 101, and Connective Services.

65    We do not think that the obiter dicta in Cowell is as limited as Almond J considered in Connective Services and TWE proposes. In Cowell the Court’s repeated obiter dicta indicated that it did not consider the obligation would apply to the use of a source of information other than the document produced under compulsion if that source was itself public. Their Honours concluded that the obligation continued to apply in Cowell because the proposed use was of the subpoenaed documents themselves (not a secondary source, let alone a secondary source that was public) and the documents had been exhibited to an affidavit tendered in evidence on an interlocutory application but were not otherwise public, the documents not having been read aloud in open court [35]-[36]. It is apparent from their Honours’ reasons that if the proposed use had been of a secondary source of information about the content of discovered documents which was itself public then it was doubtful that the obligation would apply to that public secondary source: [28], [38], [41], [48]-[50]. In any event, Cowell pre-dates Hearne v Street which expresses the obligation in precisely the same terms as Mason CJ in Esso.

66    In Hamersley Iron (which pre-dates Cowell) Anderson J, Pidgeon J and Ipp J held that the obligation continued to apply to discovered documents annexed to an affidavit which had been tendered only in relation to an interlocutory application and which had not been otherwise adduced into evidence or read aloud in open court (but had merely been referred to in open court). In so doing Ipp J at 323 observed that the approach of the minority in Harman and the majority in obiter dicta in Ainsworth v Hanrahan (1991) 25 NSWLR 155 (Kirby P and Samuels JA), as well as Mason CJ in Esso, did not mean that any discovered document tendered in evidence was no longer the subject of the obligation. Rather, the obligation ceased to apply to discovered documents tendered in evidence which were held to be admissible in the substantive (and not some mere interlocutory) proceeding. As noted, Anderson J considered that Mason CJ did not mean what he said in Esso at 32-33.

67    We are unable to accept the reasoning in Hamersley Iron and Cowell which, in our view, is inconsistent with Mason CJ in Esso, Ainsworth and, more importantly, Hearne v Street. But in any event, neither the ratio nor the obiter in Hamersley Iron and Cowell are applicable to the facts of the present case. In neither case was the relevant use of a secondary document which had itself been made fully public by publication on a court’s website as expressly contemplated by the orders of the court for notification of the proposed settlement of the proceeding. No considerations of judicial comity, accordingly, arise.

68    In Ainsworth the issue was the application of the obligation to answers to interrogatories received but not put into evidence. The New South Wales Court of Appeal held that the obligation applied. In so doing Kirby P noted that the answers to the interrogatories “had never been disclosed in public, whether in court or otherwise”: 164. At 168 Kirby P said:

Once the answers are tendered or read in open court, pace Harman, the liability in contempt for their later use will evaporate…

69    Samuels JA agreed with Kirby P: 169. Handley JA also agreed with Kirby P but reserved his position on the correctness of Harman: 169.

70    In Citicorp (decided before Hearne v Street) Hargrave J at [50]-[51] said that:

[50]    In my view, Cowell stands as authority for the narrow proposition that the mere passing of a document into evidence does not relieve the party bound by the implied undertaking from its obligations in respect of that document. Beyond this, the joint judgment of the Court contains many obiter dicta statements, some of which are set out above, concerning the use which a party may arguably make of information about documents which, by reason of their use in open court, enters “the public domain”.

[51]    In my opinion, pending resolution of the questions left open by the Court of Appeal in Cowell, I ought to apply Harman and Sybron. As I have said, Cowell itself stands for a narrow proposition which, although relevant, is not decisive of the issues which I must decide.

71    We would characterise the ratio of Cowell more narrowly than Hargraves J. The case did not concern documents produced under compulsion which were tendered in evidence. It concerned documents produced under compulsion tendered in evidence on an interlocutory application only and which were referred to but not read aloud from in open court. We agree that all else in Cowell is obiter dicta.

72    To return to Citicorp, at [59] Hargraves J concluded:

In my view, the reference to the Steiner reports in evidence at the trial of the Bagiotas proceeding has not operated to relieve Citicorp of its implied undertaking to only use those documents for the purposes of the Bagiotas proceeding. In this regard, I follow Harman, Sybron and Hamersley Iron. In my opinion, the fact that the Steiner reports were not admitted into evidence is conclusive. However, even if they were admitted into evidence, this would not, by itself, be enough to extinguish the implied undertaking in respect of them. This was the narrow point decided in Cowell.

73    For the reasons given above we do not consider Citicorp to be good law after Hearne v Street.

74    TWE submitted that other first instance decisions relied upon by the primary judge should not be followed. In this regard, it may be noted that Connective Services and Citicorp are also both first instance decisions. Apart from these decisions, in defining the scope of the obligation at common law (leaving aside the issue of the status of pleadings for the moment), the primary judge referred to K & S Corporation Ltd v Number 1 Betting Shop Ltd [2005] SASC 228 in which Debelle J at [53] identified two distinct lines of authority in Australia. In the first (Hamersley Iron and Cowell) Harman was applied so that the admission into evidence of a document did not result in the cessation of the obligation. In the second the obligation ceases on the admission of the document into evidence, citing Esso, Registrar of the Supreme Court v McPherson [1980] 1 NSWLR 688, United States Surgical Corporation v Hospital Products International Pty Ltd (unreported, Supreme Court of NSW, McLelland J, 7 May 1982), Ainsworth, Eltran Pty Ltd v Westpac Banking Corporation (1990) 25 FCR 322, and Ampolex Ltd v Perpetual Trustee Company (Canberra) Ltd (1995) 18 ACSR 218.

75    We note that in Hospital Products McLelland J referred to Harman and said:

It seems to me that the Court must attempt to distinguish between the consequences of access to a document in its character of a discovered (or subpoenaed) document on the one hand, and of access to the same document in its character of a document admitted into evidence on the other hand. Prima facie the Court should prevent utilisation for collateral purposes of access of the first kind and permit utilisation for legitimate collateral purposes of access of the second kind…

As between the parties such documents have lost their confidentiality by being admitted in evidence in open court in the (at least notional) presence of the public and of the plaintiff, and there is every reason why in such circumstances they should be available for the purposes of the related litigation in the United States.

76    In Eltran Pincus J held that subpoenaed documents which had been tendered in evidence were no longer the subject of the obligation, following Hospital Products. Pincus J described Harman as authority for a narrow proposition that where documents obtained by compulsory process are read out in open court but excluded from evidence it is a breach of the obligation to supply those documents to the press for the purpose of writing about them other than merely by way of reporting the litigation: 324. Pincus J found it difficult to accept that the obligation would have applied to the documents in Harman had they been admitted into evidence: 324.

77    In Ampolex the issue of a document being admitted into evidence did not arise but Giles CJ Comm D identified the relevant principle as one which had been accepted in NSW “with the qualification that the undertaking does not apply once the document has been produced and read out in open court”: 221.

78    In K & S Corporation Debelle J said at [65]:

An important aspect of the reasoning in Harman and in British American Tobacco to justify the conclusion that persons subject to the obligations of the implied undertaking remain subject to these obligations notwithstanding that third parties may make what use they can of what they hear in court or read in transcript is that the party gaining access to another’s documents is in a privileged position by reason of the process of the court and it is that privilege which should not be abused: see the last sentence in para 38 of British American Tobacco, Lord Roskill in Harman at 322 – 323 and see also Scott J in Sybron Corporation at 322. There can be no doubt as to the solemn nature of the undertaking and the gravity of the obligation it imposes. However, once the document has been admitted into evidence, the rationale for the undertaking evaporates. If third parties are at liberty to make what use they can of the documents, the person to whom they are disclosed should also be able to use them. The fact that the documents were initially disclosed to a person does not justify discriminating between that person and members of the public. The solemnity of the undertaking is not enhanced by such a rule. Instead, the unequal operation of the rule is likely to erode confidence in it. Sanctions exist to punish those who flout the undertaking. Courts may make orders to protect the confidentiality of documents admitted into evidence. In short, no public purpose is served by discriminating between the person to whom the document is disclosed and the third parties who may make what use of what they can of what they have heard in court or what they see in a transcript.

79    The primary judge also referred to Haswell v Commonwealth of Australia [2020] FCA 915 in which Lee J said at [17] that the scope of r 20.03 of the FC Rules reflects the common law in Australia that “the obligation comes to an end once a document is tendered in evidence or formally read in open court”, citing in support Esso at 32-33 and Ainsworth at 164-165. Lee J explained the rationale for this conclusion as follows:

[18]    First, even if it were thought (for some reason) that Mason CJ [in Esso], unusually, did not mean what he said in observing that the obligation is subject to the qualification that once material is adduced in evidence it becomes part of the public domain (…[Esso] at 32–3), the majority of the High Court made the position as to documents going into evidence plain in Hearne v Street (at 154 – 5 [96] per Hayne, Heydon and Crennan JJ)…

[19]    Secondly, and more fundamentally, the continuing maintenance of the obligation is inconsistent with the relevant information being in the public domain. An aspect of open justice is that information (be it contained in evidence or submissions) is communicated publicly to those present in the court, which in turn allows public and professional scrutiny (including fair and accurate reports of judicial proceedings), and courts will not act contrary to the principle save in exceptional circumstances: see Commissioner of the Australian Federal Police v Zhao [2015] HCA 5; (2015) 316 ALR 378 (at 387 [44] per French CJ, Hayne, Kiefel, Bell and Keane JJ). This principle is fundamental to the principled exercise of Ch III judicial power…For the obligation to continue in circumstances where the relevant information is in the public domain, would make no sense given all persons have a common law right to make a fair report of information revealed in any proceeding in open court: see Dickason v Dickason (1913) 17 CLR 50 (at 51 per Barton ACJ, Isaacs, Gavan Duffy, Powers and Rich JJ agreeing); Llewellyn v Nine Network Australia Pty Ltd [2006] FCA 836; (2006) 154 FCR 293 (at 296 [16], 298 [25] per Rares J).

80    Accordingly, Lee J considered at [20] that the obligation no longer applied to:

…information obtained from public domain documents such as: (a) publicly available Court documents, being pleadings or particulars of a pleading or a judgment or a transcript etc (see FCR 2.32); (b) documents that have been tendered; (c) affidavits which have been read; (d) expert reports which have been adduced into evidence; (e) answers to interrogatories tendered; and (f) a document read or referred to in open court in a way that discloses its contents (see FCR 20.03). As to the nature of a hearing in which such evidence is adduced (be it interlocutory, a voir dire, or a final hearing) this does not matter – as long as the hearing was in open court and there was no order made or relevant statutory exception applicable to the use or publication of the information.

81    The primary judge also referred to Eckert v National Australia Bank Ltd (1997) 191 LSJS 221. At [72] the primary judge said:

It submitted that, although Doyle CJ did not expressly say so, his Honour’s approach to the facts in Eckert demonstrated that his Honour did not regard the earlier pleading under consideration in that case which embodied information taken from discovered documents as an independent or secondary source for that information. In my view, nothing in the Chief Justice’s judgment supports that submission and I reject it.

82    We agree with the primary judge in this regard.

83    What should be made of all this? We consider that:

(1)    Harman concerned only the use of discovered documents themselves. The mere reading out of the documents in open court, according to the majority, did not cause the obligation to cease. In obiter dicta, the majority considered that the result would not change if the documents were admitted into evidence. It is also implicit in the reasons of the majority, however, that if instead of the documents, a transcript recording the contents of the document as read out loud in open court had been used by the solicitor, no obligation would have applied to the transcript.

(2)    In Hearne v Street the High Court adopted Harman but, in so doing, expressly framed the obligation as one which ceased to apply on the admission of the document (be it a discovered document or an affidavit or witness statement) into evidence: [46], [96] and [138]. As noted, there was earlier authority to this effect in Australia – Esso (referred to in Hearne v Street at [96], [107], [110]), Ainsworth (referred to in Hearne v Street at [96], [104]), Eltran (referred to in Hearne v Street at [96]), Hospital Products, McPherson, and Ampolex. When the references in Hearne v Street to Esso, Ainsworth, and Eltran are taken into account, it lends support to our conclusion above that the High Court meant what it said when it described the obligation as ceasing to apply to a document once it had been received into evidence. The rationale for this is that court hearings (subject to limited exceptions) must occur in public as a fundamental component of the requirement for open justice. Once a document is received into evidence, it is taken to be a public document which any member of the public may use (subject to an order from the court to the contrary). For the obligation not to use the document for any collateral purpose to continue to apply only to the parties and their privies would serve no useful purpose. In effect, they no longer hold a position of special advantage with respect to the document.

(3)    The proposition that the obligation applies not only to the documents themselves but also to the information in the documents must be correct (as the primary judge held at [67]). If it were otherwise, the obligation would be hollow. However, to the extent that Sybron refers to use of a secondary source of information being a transcript or judgment, its correctness has been doubted in Australia: Cowell. For our part, we consider this aspect of Sybron should not be adopted. It is contrary to the foundational principle that court hearings are open to any member of the public and thus, subject to any order to the contrary, a transcript of a hearing is taken to be a public document (accessible on payment of the relevant fee). Judgments are public documents. To hold that a party or its privy is precluded from using information in a transcript or judgment would go beyond Harman and would be inconsistent with the rationale which must underlie the statement of principle in Hearne v Street that the obligation ceases to apply to documents once they are received into evidence.

(4)    There is obiter dicta in Cowell that the obligation does not apply to use of a secondary source that is itself public. There is also obiter dicta in Cowell that the obligation does not apply to a discovered document if that document has become public knowledge in all respects. Contrary to the submissions of TWE, the obiter dicta in Cowell is not confined to two possible exceptions to the obligation – information incorporated into a judgment and a discovered document which has become public by reason of its use in open court.

(5)    If our view of Hearne v Street at [96] is correct then the formulation of the obligation in the common law of Australia is that the obligation applies to a document filed in court or discovered under compulsion until the document is admitted into evidence. If our view of Hearne v Street is incorrect then, nevertheless, the weight of authority in Australia supports the view that the obligation ceases to apply to a document once it is admitted into evidence: Esso, Ainsworth, Hospital Products, McPherson, and Eltran. Either way, at the least, the rationale for the existence of the obligation in Australia does not extend to a secondary source which has itself become public (the most obvious examples of which are a judgment or a transcript). Harman never suggested to the contrary. Sybron, to the extent it is to the contrary with respect to transcripts and judgments, has been expressly doubted: Cowell. It is not possible to reconcile the reasoning in Sybron about the obligation applying to information in judgments and transcripts with the authorities in Australia.

84    Having regard to these matters we consider that the following facts are critical. One, in preparing the Napier SOC, no use was made of any discovered document (which is different from the facts in Harman). Two, rather, use was made of documents (the Jones 3 FASOC and Jones 2 FAD) derived in part from discovered documents. Three, the secondary documents (the Jones 3 FASOC and Jones 2 FAD) had been made public. They had been published in full on the Court’s website and were available to any member of the public to read. In these circumstances, we consider that the primary judge was not in error in concluding that the Hearne v Street obligation did not apply to the secondary documents. In our view, from the moment they were placed on the Court’s website pursuant to an order of the Court, the secondary documents ceased to be the subject of any Hearne v Street obligation. The secondary documents in the present case are in no different position from the transcript in Harman. As noted, it was implicit in the reasoning of the majority in Harman that the obligation would not have applied to the solicitor using a transcript of the submissions made in open court which disclosed the contents of the documents. Sybron, to the extent it is to the contrary, should not be followed.

85    While not necessary to say so, we consider the views of Lee J in Haswell correctly reflect the state of the law in Australia. The obligation was recognised and applied in Australia before Harman. The obligation was defined in Australia as a duty not to use documents filed or produced under compulsion in litigation for any purpose other than the litigation unless and until the document was received into evidence. The rationale for the cessation of the obligation at that point is that there was no reason for the obligation once the documents had entered the public domain. The party and its privies, by reason of the document entering the public domain, were no longer in a position of special advantage with respect to the document. There was also no need to attempt to identify the extent to which any document had entered the public domain as it was a given that once received into evidence, and subject to any order to the contrary, the document was public by definition. The observations to the contrary in Harman, that admission of the documents into evidence would not cause the obligation to cease, are obiter dicta. Harman, as approved in Hearne v Street and other cases, decided a narrow issue – that the obligation does not cease in respect of discovered documents which are read aloud in court but are not admitted into evidence. To the extent that other cases (Cowell and Hamersley Iron in particular) hold to the contrary in respect of documents received into evidence for the purpose of an interlocutory application rather than the substantive hearing, we consider them inconsistent with Hearne v Street (and with the obiter dicta in Esso and Ainsworth).

86    This conclusion is sufficient to dispose of the appeal. Nevertheless, we will consider the remaining arguments.

87    The primary judge accepted the respondents’ contention that the Hearne v Street obligation does not apply to pleadings at all: [59]-[65], [71]-[72], [75]. Critical to the primary judge’s conclusion in this regard is r 2.32(2) and (3) of the FC Rules which provide that any member of the public is permitted to inspect any pleading filed in the Court, subject to any contrary order: [59]. The primary judge referred to Helicopter Aerial Surveys Pty Ltd v Garry Robertson [2015] NSWSC 2104 in which Brereton J said at [35] that “it has never been the case that pleadings have been regarded as subject to the implied undertaking, nor other evidence served in support of the pleadings”. Henry J reached the same conclusion in Canterbury-Bankstown Council v Payce Communities Pty Ltd [2019] NSWSC 1419. Santow J expressed a contrary view in eisa Limited v Damien Brady [2000] NSWSC 929 at [21].

88    TWE submitted that the primary judge was in error in this regard. First, the conclusion is inconsistent with the principle that the Hearne v Street obligation applies to information derived from a document subject to the obligation. Second, as TWE otherwise submitted, there is no nebulous “public domain” exception to the obligation. The first proposition may be accepted. There is no reason in principle why the obligation might not attach to a pleading to the extent that the pleading has been prepared using information from documents otherwise the subject of the obligation (such as discovered documents not tendered into evidence). In this Court, however, once a pleading is filed (see r 2.25 of the FC Rules) it is in the custody of the relevant District Registry (see r 2.31) and any member of the public may inspect it if it is identified in r 2.32(2) of the FC Rules (subject to r 2.32(1) and (3)). A pleading or similar document is identified in r 2.32(2)(c). Rule 2.32, by giving a stranger a right of inspection of such documents, necessarily assumes that the stranger will be able to use the documents for any purpose. The rule does not purport to place any limit on the use a stranger to the litigation might place on the documents. While the purpose might be a fair report of the litigation (which is a fundamental aspect of the principle of open justice and has always been permissible, subject to any order to the contrary), it might well be a purpose unconnected to the litigation. The necessary effect of the rule is that all such uses are permitted, despite the stranger knowing that the documents must have been created for the purpose of the litigation.

89    In the present case, no orders restricting access to the Jones 3 FASOC and Jones 2 FAD were made either at the time they were filed or subsequently. Accordingly, on filing, any member of the public was entitled to inspect those documents and, it must be accepted, to use them for any purpose. Consistently with our reasoning in relation to the rationale underlying the obligation as discussed above, we are not persuaded that the obligation applies to a pleading filed in this Court. Once the pleading has been filed then, subject to any contrary order, it is a public document. There is no sound reason for the obligation to continue to apply to the parties and their privies when any other person in the world would be free to inspect and make use of the pleading as they saw fit. The distinction between the special advantage of a party and its privies compared to the position of a stranger, in our view, does not hold in the face of r 2.32(2). Accordingly, the status of the Jones 3 FASOC and Jones 2 FAD as pleadings filed in this Court and as documents available for public inspection under r 2.32(2)(c) is an independent basis for concluding that the Hearne v Street obligation (assuming it applies to a pleading at all) ceased to apply once the pleadings had been filed and became subject to the rule.

90    The primary judge also concluded that the tender into evidence of the Jones 2 FASOC on 27 April 2017, which contains the same information from the discovered documents as the Jones 3 FASOC and Jones 2 FAD, placed that information into the public domain so that the Hearne v Street obligation no longer applied to that information: [82]. TWE submitted that the primary judge erred in this regard. The Jones 2 FASOC which was tendered was a draft proposed amended pleading. It was not evidence of the matters alleged in it.

91    We agree with the respondents that TWE’s submissions miss the point. The allegation is a misuse of information, being information in the Jones 3 FASOC and Jones 2 FAD which was derived from discovered documents. The same information was contained in the Jones 2 FASOC which was received into evidence. On receipt of that document into evidence any Hearne v Street obligation which might have applied to it and the information it contained ceased. It is not to the point that, being a pleading, the Jones 2 FASOC was not evidence of the facts alleged in it. The point is that the information in the Jones 2 FASOC became public on its receipt into evidence. That fact brought any Hearne v Street obligation with respect to the Jones 2 FASOC and its contents to an end.

92    The other matter raised during the appeal but not before the primary judge was r 20.03 of the FC Rules (set out above). TWE suggested that the rule was narrower than the qualification about receipt into evidence as referred to in Hearne v Street at [96]. We think this wrongly assumes that the rule does not pre-suppose that the relevant obligation ceases in any event once a document is admitted into evidence. Properly understood, r 20.03 is a direct response only to Harman, where the documents were not admitted into evidence. The rule overcomes the effect of Harman but says nothing as to whether the obligation applies once a document has been received into evidence. Nevertheless, we agree with TWE that r 20.03(1) does not speak to the facts of the present case. The qualification “in open court in a way that discloses its contents” must apply to both the act of “read” and “referred to”. There is no evidence that in the present case that the Jones 2 FASOC, the Jones 3 FASOC, or the Jones 2 FAD were read or referred to in open court in a way that disclosed their contents. Accordingly, r 20.03(1) does not apply. The issue having been fully argued, however, we would grant the respondents leave to raise the argument and the first and second respondents leave to file the notice of contention which they provided after the hearing of the appeal raising this issue.

93    Grounds 1 to 4 (as well as 8 and 9 relating to the primary judge’s decision to grant a release and leave retrospectively) of the appeal should be dismissed for these reasons.

Release of the obligation (issues (7)-(9))

94    As we consider the primary judge made no error in holding that the Hearne v Street obligation did not apply to the Jones 3 FASOC or the Jones 2 FAD the question whether the primary judge erred in also concluding that orders should be made, as a matter of abundant caution, releasing the respondents from the obligation and granting them leave to rely on those documents for the purpose of the Napier proceeding does not arise.

95    To the extent it is necessary to say so, we would have reached the same conclusion as the primary judge and made the same orders even having regard to TWE’s further evidence (which, on our reasoning, does not constitute a further breach of the obligation). Assuming, however, that the obligation applies to the Jones 3 FASOC and the Jones 2 FAD and that the respondents breached the obligation by using those documents to prepare the Napier SOC we would have granted TWE leave to adduce evidence of the redacted defence to counter-claim in the Napier proceeding and made orders nunc pro tunc releasing the respondents from the obligation and granting them leave to use the documents for the purpose of the Napier proceeding.

96    In Springfield Nominees Pty Ltd v Bridgelands (1992) 38 FCR 217 Wilcox J referred to the authorities and stated at 225:

For ‘special circumstances’ to exist it is enough that there is a special feature of the case which affords a reason for modifying or releasing the undertaking and is not usually present. The matter then becomes one of the proper exercise of the court’s discretion, many factors being relevant. It is neither possible nor desirable to propound an exhaustive list of those factors. But plainly they include the nature of the document, the circumstances under which it came into existence, the attitude of the author of the document and any prejudice the author may sustain, whether the document pre-existed litigation or was created for that purpose and therefore expected to enter the public domain, the nature of the information in the document (in particular whether it contains personal data or commercially sensitive information), the circumstances in which the document came into the hands of the applicant for leave and, perhaps most important of all, the likely contribution of the document to achieving justice in the second proceeding.

97    In Citicorp at [65] Hargaves J said:

To the list of factors mentioned by Wilcox J. as being relevant to the identification of “special circumstances” in a given case, I would add another. The extent to which the information contained in the documents under consideration has entered the “public domain” is a relevant factor. This was recognised in Cowell [[26], [34] and [35].] and in Sybron [322-333].

98    In Liberty Funding Pty Ltd v Phoenix Capital Ltd [2005] FCAFC 3; (2005) 218 ALR 283 at [31] the Full Court of the Federal Court said:

In order to be released from the implied undertaking it has been said that a party in the position of the appellants must show “special circumstances”: see, for example, Springfield Nominees Pty Ltd v Bridgelands Securities Ltd (1992) 38 FCR 217. It is unnecessary to examine the authorities in this area in any detail. The parties were not in disagreement as to the legal principles. The notion of “special circumstances” does not require that some extraordinary factors must bear on the question before the discretion will be exercised. It is sufficient to say that, in all the circumstances, good reason must be shown why, contrary to the usual position, documents produced or information obtained in one piece of litigation should be used for the advantage of a party in another piece of litigation or for other non‑litigious purposes. The discretion is a broad one and all the circumstances of the case must be examined.

99    In Helicopter Aerial Brereton J said at [44] that:

Generally, all that is required by special circumstances is some good reason – or, as I would be inclined to put it, some circumstance – that warrants relief from the undertaking.

100    There is no doubt that orders releasing the Hearne v Street obligation and granting leave to use the documents for the purpose of the Napier proceeding can be made retrospectively: Forty Two at [94]. Further, as White J observed in Polyaire Pty Ltd v K-Aire Pty Ltd [2011] SASC 176; (2011) 111 SASR 19 at [49], provided the issue is not hypothetical, a finding of breach of the Hearne v Street obligation is not a prerequisite to the making of an order releasing the obligation. In the present case, there can be no suggestion (and none was raised) that the orders the primary judge made did not involve the resolution of a real, rather than merely hypothetical, dispute between the parties.

101    TWE emphasised the fact that the respondents had not apologised or offered to pay indemnity costs or otherwise offered to compensate TWE for the breach of the obligation. This misunderstands the respondents’ position. The respondents did not admit breach of the obligation. To the contrary, they contended that they were not in breach of the obligation and, out of an abundance of caution, sought orders nunc pro tunc in case they were wrong. In common with the primary judge at [87] we consider it somewhat unreal to give weight to the fact that the respondents have not apologised or offered to pay costs or compensation in circumstances where their primary position was that they were not in breach. Even if the respondents had been in breach we would have been satisfied that there were special circumstances sufficient to warrant the making of the orders for a release from the undertaking and leave to use the documents nunc pro tunc, the effect of which (when made) is that there was and never had been any breach and thus was and never had been any contempt of this Court. In these circumstances, the considerations which TWE emphasised (an apology, costs and compensation) are immaterial, at least on the facts of this case. The respondents did not come to court seeking to purge a contempt. If they had, the factors emphasised by TWE would have been material. However, the respondents came to court seeking declarations that they were not in breach of the Hearne v Street obligation and orders nunc pro tunc, the effect of which (if granted), would be that there was no contempt at all. TWE’s focus on the considerations of an apology, costs and compensation is inapt for these reasons.

102    In this regard, we note that Judd J reached a similar conclusion in Slea Pty Ltd v Connective Services Pty Ltd [2017] VSC 706; (2017) 53 VR 161. In Slea Judd J at [37] referred to the principle (not raised by TWE in this proceeding, for good reason, as will be explained) that a court will not hear a person in contempt until the contempt has been purged, citing Hadkinson v Hadkinson [1952] P 285 at 288. In Hadkinson two exceptions to this principle were identified – an application to purge the contempt and an appeal against the finding of contempt. In Slea at [38] Judd J identified a necessary third exception – an application to vary or adjust the underlying obligation. In Slea an application of the third kind was made, Almond J having found a breach of the Hearne v Street obligation in Connective Services. At [45] Judd J observed that:

…a successful application for retrospective leave will transform the impugned conduct, found to be in breach of an implied undertaking, into a valid act.

103    At [46] in Slea Judd J said (in reasoning we consider applies equally to the present case):

A requirement imposed on the Connective Companies to purge their contempt before making any application for the relief now sought is inconsistent with the accepted right to apply to retrospectively vary the underlying obligation. The elements of purging initially demanded by Slea seem illogical and inapt. Slea demanded an unequivocal apology. It is somewhat artificial and meaningless to require an unequivocal apology from a party who vigorously argued against the existence of the underlying obligation, and who now seeks to be relieved of its operation.

104    The primary judge, as noted, adopted a similar approach: [87]. He did not err in so doing. Grounds 8 and 9 of the appeal are without merit. Contrary to those grounds, his Honour did not err by applying incorrect legal principles. Nor do his reasons at [85] fail to disclose a proper consideration of the existence of special circumstances, to which the primary judge referred at [84]. The primary judge did not fail to take into account a relevant consideration, being the alleged further breach of the obligation arising from preparation of the defence to counter-claim in the Napier proceeding. The primary judge explained why he had not adjourned the proceeding to enable evidence of the defence to counter-claim to be adduced before him: [101]. In so doing, as we have said, the primary judge did not deny TWE procedural fairness. Accordingly, it cannot be said that the primary judge’s decision was made without taking into account a relevant matter. This disposes of ground 8. Ground 9 assumes that the respondents applied to purge a contempt. As we have said, that is not the case. The primary judge was correct at [87] not to give material weight to TWE’s contention that no orders should be made in the respondents’ favour until they had apologised and agreed to pay TWE’s costs on an indemnity basis. The fact that his Honour did not refer to compensation is immaterial. TWE did not identify any compensation which it sought, other than indemnity costs.

105    Had we concluded that the primary judge erred in the exercise of his discretion then we consider that on the facts of the present case, there are overwhelming factors which would justify the making of the same orders the primary judge made. In particular:

(1)    in the present case, as Wilcox J put it in Springfield Nominees, there is a special feature of the case which is not usually present. The Jones 3 FASOC and the Jones 2 FAD (which contained the relevant information from the discovered documents) were placed on the Court’s website pursuant to a notice issued under order of the Court and were (and are) available for the world at large to see. They have been on the Court’s website since September 2017 and remain available on the website today. TWE never sought an order protecting the relevant information in the Jones 3 FASOC and the Jones 2 FAD from public disclosure. The respondents used the information from the Jones 3 FASOC and the Jones 2 FAD as published on the Court’s website to prepare the Napier SOC. Of itself, these facts provide sufficient special circumstances to justify the making of the orders releasing the respondents from any Hearne v Street obligation in respect of the Jones 3 FASOC and the Jones 2 FAD and granting them leave to use those documents for the purpose of the Napier proceedings;

(2)    otherwise, it is relevant that the Jones 3 FASOC and the Jones 2 FAD are pleadings which, pursuant to r 2.32(2)(c) of the FC Rules, are available for any member of the public to inspect and make use of including for purposes unconnected with the litigation;

(3)    it is also relevant that the information derived from the discovered documents in the Jones 3 FASOC and the Jones 2 FAD was contained in another document, the Jones 2 FASOC, tendered into evidence without any order sought or made to protect the information from public scrutiny;

(4)    TWE has not pointed to any prejudice it might sustain by reason of the fact that it was the lawyers in the Jones proceeding who used the information from the Jones 3 FASOC and the Jones 2 FAD to prepare the Napier SOC. TWE stressed that those lawyers were in a position of special advantage in terms of their knowledge of the Jones 3 FASOC and the Jones 2 FAD, including its publication on the website, from their position in the Jones proceeding. However, once the Jones 3 FASOC and Jones 2 FAD were published to the world at large on the Court’s website, it is difficult to accept that any special advantage continued. Further, in circumstances where the Jones proceeding was a class action against TWE, the settlement of which was notified to the public and approved by the Court, there is serious doubt about the maintenance of any position of special advantage by the lawyers in the Jones proceeding. Any lawyer retained in the Napier proceeding, another class action against TWE in relation to a number of the same key facts (albeit relating to a subsequent time period), would know that documents relating to the Jones proceeding would be available for inspection pursuant to r 2.32 of the FC Rules. In these circumstances, the effect of TWE’s claim of prejudice is that every lawyer would have been free to use the Jones 3 FASOC and the Jones 2 FAD and would have been able to inspect those documents to prepare the Napier SOC but for MB and Mr Donnellan. Once the recourse to the concept of special advantage of those lawyers is undermined (as it must be on the facts) TWE’s proposed prejudice is inherently unpersuasive;

(5)    the Jones 3 FASOC and the Jones 2 FAD were prepared for the purpose of the Jones proceeding, and given r 2.32(2)(c) of the FC Rules, TWE must be taken to have known that the documents would enter the public domain unless they sought an order to the contrary, which TWE did not do;

(6)    the information from the Jones 3 FASOC and the Jones 2 FAD used by MB and Mr Donnellan to prepare the Napier SOC was information from the copies of those documents made accessible to the world at large by publication on the Court’s website; and

(7)    the information in question was used to prepare the Napier SOC and thus must be taken to have been important to the claims made in the Napier proceeding. Accordingly, it may be taken that it is in the interests of the administration of justice that the respondents should be able to use the information for that purpose.

106    The fact that orders were not sought by the respondents before they made use of the information in the Jones 3 FASOC and Jones 2 FAD is not a reason to withhold orders releasing them from the obligation (if it exists, which we consider it does not) and granting leave to use the documents for the purpose of the Napier proceeding retrospectively. As in Slea at [44]:

It is important to properly characterise the nature of the obligation breached by the litigant, and the relevant conduct of the party found in breach. The breach found by Almond J involved the consideration of a complex factual matrix and uncertain law. There was a genuine dispute over the question whether a breach had occurred at all. This was not a case of flagrant breach of an order of the Court, or of an order only amenable to adjustment on appeal. It did not involve special circumstance that would require a step to be taken by the Connective Companies to rectify a state of affairs (such as the return of a child to jurisdiction) before justice could be achieved.

The impugned conduct involved the initiation of a proceeding which would thereafter continue under the supervision and management of the Court.

107    There is no suggestion in the evidence that the respondents knew of the existence of the Hearne v Street obligation and disregarded it in preparing the Napier SOC in the hope of gaining some forensic advantage by not seeking the orders for release from the obligation in advance. To the contrary, the respondents always maintained they were not in breach of the obligation. The respondents’ position (which we have found to be correct) always involved a more than reasonably arguable approach to the relevant law. In contrast to the observations of Rimer J in Miller v Scorey [1996] 3 All ER 18 at 30, this is not a case in which it can be said that the respondents have taken advantage of their own wrong. Justice Rimer also said at 28:

It is one thing to release a party from an undertaking to the court so as to permit him to do in the future that which he has been prevented from doing in the past. It is another thing for the court to find, as I have, that a party has abused the process of the court by his breaches of an undertaking to it and for it then to give that party a retrospective release from the undertaking so as to wipe away the abuse of the process which he has committed.

108    These considerations may well be relevant in a case where a person has sought to obtain some forensic advantage by refraining from seeking appropriate orders in advance of using the relevant documents the subject of the Hearne v Street obligation. If a breach is found then, as Yates J said in Forty Two at [95], the breach will always be a significant concern. But where, as here, any assumed breach was the result of the lawyers reasonably not appreciating that there might be a Hearne v Street issue, or reasonably taking a position in good faith that the Hearne v Street obligation did not apply to the documents and no forensic advantage was sought to be or was in fact obtained by the failure to seek, or a decision to refrain from seeking, appropriate orders, the guiding consideration should be whether orders would have been made had they been sought before the use was made of the documents. In the present case, the answer to that issue would undoubtedly be in the affirmative in the circumstances we have described above.

109    For these reasons we consider that the primary judge was correct to make the orders he did. Had it been necessary to do so, we would have made orders to the same effect. Given our conclusions above that the present case does not involve an application by the respondents to purge a contempt, we see no reason why we should not adopt the same approach as the primary judge in relation to costs. That is, on dismissal of the appeal, costs should follow the event – TWE should pay the respondents’ costs.

Associate:

Dated:    17 December 2020