FEDERAL COURT OF AUSTRALIA

Betfair Pty Limited v Racing New South Wales (No 2) [2009] FCA 195

BETFAIR PTY LIMITED v RACING NEW SOUTH WALES, HARNESS RACING NEW SOUTH WALES and ATTORNEY GENERAL FOR THE STATE OF NEW SOUTH WALES

NSD 1566 of 2008

PERRAM J

4 MARCH 2009

SYDNEY

THE COURT ORDERS THAT:

1.                  The respondents produce the documents sought pursuant to Order 15 rule 10 in the applicant’s notice to produce dated 27 January 2009 by 27 February 2009.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using eSearch on the Court’s website.

REASONS FOR JUDGMENT

1                     This proceeding was listed for directions on 25 February 2009.  During the course of that hearing the applicant raised the issue of the respondents’ non-compliance with a notice to produce served on the respondents on 27 January 2009.  The notice to produce described two categories of documents which were said to have been referred to in the respondents’ defence.  The applicant sought an order that the respondents produce the documents, presumably pursuant to O 15 r 11(1) or O 35A r 3(2), and I made the order sought.  These are my reasons for making that order.

2                     Mr Robertson SC, who appeared with Ms Morgan for the applicant, indicated that the notice to produce was issued pursuant to O 15 r 10.  That rule provides:

(1)       Where a pleading or affidavit filed by a party refers to a document, any other party may, by notice to produce served on him require him to produce the document for inspection.

(2)       Where a notice to produce a document is served on a party under subrule (1), he shall, within 4 days after that service, serve on the party requiring production a notice:

(a)       appointing a time within 7 days after service of the notice under this subrule when, and a place where, the document may be inspected;

(b)       claiming that the document is privileged from production and sufficiently stating the grounds of the privilege; or

(c)       stating that the document is not in his possession, custody or power and stating to the best of his knowledge information and belief where the document is and in whose possession, custody or power it is.

3                     The notice to produce itself bears a reference to O 15 r 10(2) rather than O 15 r 10(1), but that is of no consequence.  The substantive part of the notice to produce is in the following terms:

The Applicant requires you to produce the following documents for the purpose of evidence:

1.         Each version of the Racing Distribution Agreement as amended from time to time, which documents are relied upon by the Respondents in paragraph 30.2 of their Defence.

2.         The Deed of Co-operation and Amendment, which document is relied upon by the Respondents in paragraph 31.2 of their Defence.

4                     Paragraphs 30 and 31 of the applicant’s statement of claim provide:

30.       On or about 11 December 1997, TAB Limited entered into an agreement with NSW Racing Pty Ltd (now called RACINGCORP Pty Limited (“Racingcorp”)) known as the Racing Distribution Agreement (“RDA”).  Under the RDA, Racingcorp acts as agent for the controlling bodies of each of the 3 racing codes in New South Wales.

31.       In December 2004 the parties to the RDA, along with TABCORP Holdings Limited, which had acquired TAB Limited, entered into a Deed of Accession, Co-operation and Amendment which amended the RDA.

5                     Paragraphs 30 and 31 of the respondents’ defence provide:

30        As to paragraph 30 of the statement of claim, the first and second respondents:

30.1     admit that TAB Limited entered into the RDA with Racingcorp, Racing NSW, HRNSW and GRNSW;

30.2     rely on the terms and effect of the RDA, as amended from time to time; and

30.3     otherwise do not admit the paragraph.

31        As to paragraph 31 of the statement of claim, the first and second respondents:

31.1     admit that the parties to the RDA and TABCORP Holdings Limited entered into a Deed of Accession, Co-operation and Amendment;

31.2     rely on the terms and effect of that deed; and

31.3     otherwise do not admit the paragraph.

6                     Mr Robertson submitted that there was no basis for refusing to comply with the notice to produce, as the pleading clearly referred to the documents requested.  The rule was engaged; it should be obeyed.

7                     Mr Emmett, who appeared for the respondents, submitted that the references in the respondents’ defence were entirely responsive to the references to the same documents in the applicant’s statement of claim.  The defence was, in essence, only referring to the statement of claim.  In those circumstances, it was submitted, there was no obligation on the respondents to produce the documents.

8                     It is convenient to treat the respondents as seeking to set aside the notice to produce.  It should be noted that both parties proceeded on the basis that the documents named in the relevant paragraphs of each pleading are the same documents.

9                     Upon a closer examination of the pleadings it appears that the premise upon which the parties proceeded, at least in respect of the first category of documents, may not have been entirely sound.  Paragraph 30 of the statement of claim refers only to one document (“an agreement”) being the RDA.  Paragraph 30 of the defence, however, refers to the RDA “as amended from time to time”.  The latter pleading in its terms appears to refer to a range of documents rather than a single document.  It follows that Mr Emmett’s submission must be rejected at least with respect to those documents that are not referred to in the statement of claim.

10                  The position in respect of the remaining documents, being the RDA itself and the “Deed of Accession, Co-operation and Amendment” (which is one of the amended versions of the RDA), requires further consideration.

11                  Order 15 r 10 is intended to give the opposite party the same advantage, with respect to documents referred to in pleadings or an affidavit, as if the documents were set out in the pleading or affidavit: Quilter v Heatly (1883) 23 Ch D 42 at 50 per Lindley LJ.  This is a requirement of basic procedural fairness: Australian Competition & Consumer Commission v Visy Industries [2006] FCA 136 at [33] per Heerey J.

12                  A party who is served with a valid notice to produce under O 15 r 10(1) must serve their own notice in response in accordance with O 15 r 10(2).  In essence, the party must do one of three things: produce the documents; claim privilege over the documents; or disclaim possession and provide a statement as to the location of the documents.  During submissions, there was no express reference to the three limbs of O 15 r 10(2).  It is apparent, however, that the documents are in the possession of the respondents and that they do not intend to make a claim for privilege.  It follows that if they are successfully to resist production of the documents it must be shown that the notice to produce was invalid or that it should be set aside.

13                  I take the respondents’ argument to be that the words “refers to a document” in O 15 r 10(1) should be read as excluding references to documents that have previously been referred to in a pleading or affidavit filed by the party who served the notice to produce.

14                  This argument should be rejected.  The meaning of the words “refers to” in O 15 r 10(1) is well-established and there is no reason to limit their scope in the manner suggested: King v GIO Australia Holdings Ltd [2001] FCA 1487 at [16]-[17] per Moore J.  There may be circumstances in which a party has good reasons for referring to a document in a pleading or affidavit without having the document in its possession, custody or power – for example, where the party has only seen the document or has lost possession of the document.  So much is expressly contemplated by O 15 r 10(2)(c).  If the document is in the possession, custody or power of another party and is also relied upon by that other party, I see no reason why that other party should not be required to produce the document to the first party.  This may be particularly apposite to litigation involving a number of parties with similar claims or similar defences.

15                  In Quilter v Heatly the plaintiff’s statement of claim referred to a letter that had been written by the defendant and sent to the plaintiff.  The defendant served a notice to produce requesting, amongst other things, the defendant’s own letter.  Jessel MR held (at 49) that an order for production of that document should be made as of course.  While the circumstances in that case are not precisely the same as the present, if a party can request one of their own documents, they can surely request the documents of another party.  It should not matter whether the first party also relies upon the documents as well.

16                  It is relevant to note at this point that Mr Emmett did not assert that the applicant already had the documents requested in its possession, custody or power and that production of the documents would thereby be futile or oppressive.  It is not necessary to decide whether a notice to produce issued under O 15 r 10(1) could be set aside on such grounds.  While it is apparent from the book of particulars filed by the applicant that it has at least one version of the RDA in its possession, I do not think that alone means production would be futile or oppressive or that service of the notice to produce was an abuse of process.  There is a forensic benefit in being able to review a document relied upon by another party even though that party may believe it is the same as a document that is already held by the first party.

17                  It follows from the above that Mr Emmett’s application to set aside the notice to produce must be refused.  The only matter remaining is the applicant’s application for an order that the documents be produced.

18                  The power to make such an order can be found in O 15 r 11(1) which provides:

Where:

…

(b)       a pleading or affidavit filed by a party refers to any document;

…

the Court may, subject to any question of privilege which may arise, order the party;

(d)       to produce the document for inspection by any other party at a time and place specified in the order;

…

19                  This power is subject to a precondition which is expressed in O 15 r 15:

The Court shall not make an order under this Order … for the production of any document unless satisfied that the order is necessary at the time when the order is made.

20                  The criterion of ‘necessity’ is a broad criterion which requires consideration of the interests of justice in the particular case as well as its economic and efficient disposition: Commonwealth v Northern Land Council (1991) 30 FCR 1 at 24-25 per Black CJ, Gummow and French JJ.  During the hearing Mr Emmett conceded that the documents sought would eventually be discovered by the respondents in any event.  It follows that no prejudice will flow from disclosure.  The economic and efficient disposition of this case also favours immediate disclosure.

21                  Finally, I note that O 35A r 3(2) might have also supported the making of the order sought by the applicant.  Having regard to O 15 r 11(1), however, I do not find it necessary to make any findings as to whether the respondents were in default.

22                  It was for these reasons that I made the order for production on 25 February 2009.

Associate:

Dated:         4 March 2009