FEDERAL COURT OF AUSTRALIA

Drilling & Grouting Services Pty Ltd v Carpentaria Gold Pty Ltd [2010] FCA 1456

In relation to the respondent’s notice of motion, filed 29 September 2009, the Court orders that:

1.    Within 14 days following the date of this order, the applicant by its director, Warren Mark Symons, file with the Court and serve on the respondent an affidavit stating whether any document of the following class is or has been in the applicant’s possession, custody or power and, if it has been but is not then in the applicant’s possession, custody or power, when the applicant parted with it and what has become of it.

(a)    Any weekly, monthly or any other periodical report, relating to the financial performance of the applicant’s undertakings in respect of the respondent for any period within 1 July 2005 to 31 January 2008.

(b)    Any weekly, monthly or any other periodical report of the applicant’s undertakings which partly includes, and incorporates or summarises financial information relating to the financial performance of the applicant’s undertakings in respect of the respondent for any period within 1 July 2005 to 31 January 2008.

(c)    Any annual or quarterly financial statements of the applicant for the years ending 30 June 2006, 30 June 2007 and 30 June 2008 relating to the financial performance of the applicant’s undertaking in respect of the respondent.

(d)    Any tax return of the applicant for the years ending 30 June 2006, 30 June 2007 and 30 June 2008 relating to the financial performance of the applicant’s undertaking in respect of the respondent.

2.    The applicant pay the respondent’s costs of incidental to the notice of motion to be taxed if not agreed.

In relation to the applicant’s notice of motion, filed 9 October 2009, the court orders that:

1.    Subject to Order 2, the notice of motion be dismissed.

2.    The respondent give discovery of the documents referred to in para 1(l), (m), (n), (u) and (w) as soon as practicable.

3.    The applicant pay the respondent’s costs of the notice of motion to be taxed if not agreed.

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 Federal Law Search on the Court’s website.

REASONS FOR JUDGMENT

Respondent’s application for discovery of additional documents

1    By notice of motion filed 29 September 2009, the respondent seeks orders that the applicant give additional discovery in respect of the following documents:

(1)    Any weekly, monthly or any other periodical report relating to the financial performance of the applicant’s undertakings in respect of the respondent for any period within 1 July 2005 to 31 January 2008.

(2)    Any weekly, monthly or any other periodical report of the applicant’s undertakings which partly includes, incorporates or summarises financial information relating to the financial performance of the applicant’s undertakings in respect of the respondent for any period within 1 July 2005 to 31 January 2008.

(3)    Any annual or quarterly financial statements of the applicant for the years ending 30 June 2006, 30 June 2007 and 30 June 2008.

(4)    Any tax return of the applicant for the years ending 30 June 2006, 30 June 2007 and 30 June 2008.

2    The respondent requires that in the course of discovering such documents any document, being a report, spreadsheet, schedule or record (including contract job cost records) which the applicant is able to provide in paper form at and which has been printed from an electronic file, also be provided by delivery of an electronic copy of that file in native format.

3    The applicant is a proprietary company having two directors, one of whom is the company secretary. The directors are the sole shareholders of the applicant.

4    The applicant claims it has suffered loss and damage for wrongful termination of a contract and for breach of s 52 of the Trade Practices Act 1974 (Cth) (TPA).

5    The applicant at this point has not provided particulars of the loss and damage claimed but says it will do so by way of expert evidence to be adduced prior to trial.

6    The respondent says it does not know what loss and damage is claimed, or how the applicant intends to calculate its loss and damage, although the applicant has advised it that “it does not claim costs for the period after 31 January 2009”.

7    The respondent does not take issue with the applicant’s intention to provide particulars of its loss and damage by way of expert evidence, but says the applicant remains obliged to give discovery of all documents which are relevant to evidencing and quantifying the loss and damage.

8    On 16 October 2008 an order was made requiring the parties to give general discovery by list, pursuant to O 15, r 3 of the Federal Court Rules 1979 (Cth) (FCR).

9    The respondent also emphasises that the applicant is under a continuing obligation, under O 15, r 7A to discover documents not previously discovered or which would otherwise be necessary to comply with the order for general discovery.

10    The applicant in purported compliance with the order made, provided a list of documents dated 24 October 2008. A director of the applicant verified the list by affidavit. However, an additional list of documents has also been given to the respondent, although undated and not verified.

11    On 19 May 2009, the respondent’s solicitor wrote to the applicant’s solicitor expressing concern that the applicant had not fully complied with its discovery obligations, noting:

(1)    The two documents made available for inspection by the application in paper format, namely documents 1069 and 1071 appeared to originate from electronic documents.

(2)    If those documents were printed from electronic documents then those electronic documents would likely contain information not disclosed by the paper copies and so should be made available for inspection.

(3)    In any event, it is likely that documents 1069 and 1071 were created from data extracted from a larger accounting database.

(4)    The applicant had not discovered the database.

12    On 19 May 2009, the solicitors for the applicant responded advising that:

(1)    The applicant’s solicitors intended asking the applicant to confirm whether it had any further discoverable documents relevant to quantum and would advise shortly.

(2)    If there were further documents, whether in electronic or hard form they would be discovered.

13    The applicant has not since confirmed whether it has further discoverable documents relevant to quantum.

14    During a case management conference on 4 June 2009, the solicitors for the applicant stated that the applicant intended printing “job costing” reports from its “accounting database”. In other words, the respondent says, the solicitor for the applicant then indicated that the applicant possessed further discoverable documents relevant to quantum, namely, an “accounting database”.

15    On or about 10 August 2009, the applicant served on the respondent a letter dated 10 August enclosing a copy of a job cost record which the applicant’s solicitors says had been “run from our client’s Pronto software”. Two large green files of job costs were enclosed. The first contained sheets which appeared to have been printed from an electronic spreadsheet.

16    On 8 September 2009, the applicant, through its solicitor, served on the respondent’s solicitor a bundle comprising amended and updated job cost records. An explanatory note stated in part that transaction reports had been run from the applicant’s Pronto Xi Enterprise Management Solution System for the relevant periods. These previously had been provided in Excel spreadsheet form. Also enclosed with this letter were a bundle of various reports, spreadsheets, schedules and reports in paper format, all of which appear to have been printed from an electronic spreadsheet.

17    The respondent says it is unsurprising that the applicant operates an electronic accounting database. It says it is common practice for businesses to produce weekly, monthly or other periodical management reports to allow management to review and assess financial performance. It is also common if not essential practice that where a business undertakes different “jobs” that such reports will be prepared to show the business’ financial performance on a “job by job” basis.

18    The respondent says it currently does not know what loss and damage is claimed or how the applicant intends to calculate it. The respondent submits in effect that the contract job costing report information is relevant to the assessment of claimed damages.

19    The respondent contends that the information is relevant to the apportionment of indirect costs to the loss and damage which the applicant claims, such as:

(1)    The manner and basis for the apportionment.

(2)    The number of other “jobs” amongst which the apportionment might be made.

(3)    The financial characteristics of other jobs, including their revenue and expense characteristics.

20    The respondent says that if the applicant’s activities in relation to the contract are not the applicant’s only “jobs” on the electronic accounting database, then the financial statements and tax returns will nonetheless be relevant and discoverable as they will:

(1)    Summarise the financial performance and position of the applicant, arising from the applicant’s activities.

(2)    Provide a basis to compare the results of the applicant’s activities in relation to the contract as compared to all of its activities, including for the purposes of apportionment and uniformity or expenses incurred by the applicant.

21    The respondent says the financial statements and tax returns for the relevant years are discoverable as they are already certified as true and correct and are credible documents against which the validity of periodic management reports may be verified.

22    The respondent says the risk arising from the failure of the applicant to provide adequate discovery in this regard is that it will necessitate a far greater auditing of the applicant’s claimed loss and damages which is undesirable from both a delay and costs perspective.

23    The respondent also contends that it is important that the relevant information be provided in native electronic format having regard to the observations in para 5.1 of the Federal Court’s Practice Note Number 17 (now Practice Note CM6) and also to permit convenient usage and analysis

24    The applicant says that when it gave general discovery by giving both lists of documents referred to earlier, the discovery included voluminous cost records for the Ravenswood project, the subject of the proceedings.

25    The applicant says that discovery included voluminous records regarding its revenue for the project, including all site drilling records and all invoices to the respondent for the relevant period October 2005 to November 2007.

26    In May 2009, the respondent requested additional discovery relevant to the quantum of the applicant’s claim.

27    The applicant says it uses the Pronto Enterprise Management System software, which is an integrated software system including a financial control centre, which in turn includes payroll, accounts receivable, accounts payable, assets register and general ledger management.

28    The applicant claims costs for the period October 2005 to January 2009 on the basis that notwithstanding its ceased work on the project in November 2007, it continued to incur costs until January 2009.

29    The applicant says on 10 August 2009, it discovered all its Pronto job cost records for the project for the period October 2005 to November 2007. They comprised two lever arch files of documents including ledgers, reports and summaries.

30    At the time the Pronto records were discovered:

(1)    it was unclear, and remains unclear, whether the respondent required the applicant to discover any remaining “base” cost records, such as copies of payroll records for employees or whether the respondent disputed the accuracy of the job cost records recorded on the Pronto system; and

(2)    the respondent had not demanded the applicant discover additional “base” costs records that had not already been discovered in November 2008.

31    For that reason, the applicant did not discover any additional base cost records at the same time as the Pronto cost records in August 2009.

32    On 8 September 2009, however, the applicant discovered an amended summary of Pronto cost records for the project for the period October 2005 to November 2007 and all of its Pronto cost records for the period December 2007 to 31 January 2009. Those records comprised one lever arch file of documents and again included ledgers, reports and summaries.

33    Again, at the time the Pronto records were discovered, the applicant says:

(1)    it was unclear whether the respondent required it to discover any remaining “base” costs records or whether the respondent disputed the accuracy of the Pronto cost records; and

(2)    the respondent had not demanded the applicant discover any additional “base” cost records.

34    For that reason, the applicant did not discover any additional “base” cost records at the same time as the Pronto cost records in August 2009.

35    So far as the first category of periodical reports that the respondent requires, the applicant says it is unclear what is meant by the words “report relating to the financial performance of the applicant’s undertakings in respect of the project” contained in para 1(1)(a) of the notice of motion. The applicant assumes those words are intended to mean a report relating to the applicant’s costs and revenue for the project during that period.

36    The applicant says it does not have in its possession, custody or control any weekly, monthly or other periodical reports regarding the project for the relevant period:

(1)    not generated by Pronto which have not already been discovered; or

(2)    generated by Pronto which have not already been discovered.

37    As to the Pronto generated documents the applicant says it does not have such periodical reports generated by Pronto because:

(1)    the applicant has already discovered Pronto general cost reports, equipment reports, labour hire reports and hire purchase reports for the project for the relevant period in August and September 2009;

(2)    Pronto is a financial control centre which records all costs and revenue for all jobs carried out by the applicant, including but not limited to costs and revenue for the project, in its database. It does not automatically generate or store periodical reports; and

(3)    Pronto is a fully searchable centre, which enables the user to generate custom reports as and when required. For example, the applicant specifically generated and discovered the reports that it has provided for the purpose of giving discovery.

38    The applicant says it cannot discover in “native format” as required by the respondent, in relation to an electronic copy of the reports generated using Pronto. That is because the Pronto software would be required to view the reports and the entire Pronto database, which includes all the applicant’s records for all jobs, not solely for the project, would need to be discovered. The respondent is plainly not entitled to discovery of all those records.

39    The applicant says it has provided full particulars of its loss and damage in its reamended statement of claim dated 10 August 2009, and in the Pronto reports and record referred to earlier.

40    The applicant says that regardless of this, in the absence of a request by the respondent to discover additional “base” cost records, it is preparing discovery of all remaining “cost” records for the project for the relevant period which have not already been discovered including, principally, payroll records.

41    The applicant says once those documents have been discovered, the respondent will be able to inspect every single “base” cost recorded on the Pronto system and listed in the Pronto records, which have already been discovered. In other words, the respondent will be able to audit those records to satisfy itself that the Pronto cost records are correct.

42    The applicant says it has already discovered all “base” cost records regarding revenue from the project because it has discovered all invoices issued by the applicant to the respondent for the relevant period. It says that regardless, the respondent already has that information given that it paid each of those invoices.

43    The applicant makes similar submissions about the periodical reports the subject of the notice of motion in para 1(1)(b).

44    In relation to the financial statements mentioned in para 1(1)(c) of the notice of motion, the applicant says for the period October 2005 to November 2007 it supplied services to clients on, on average, 20 to 25 jobs.

45    The applicant says it has accounts in its periodical financial statements on a consolidated basis for all jobs. There is no separate record for the project during the 2006, 2007 or 2008 financial years.

46    Contrary to the respondent’s submissions, the applicant says the statements do not “provide a basis to compare the results of the applicant in relation to the contract as compared to all of its activities”.

47    Accordingly, the applicant says the statements are irrelevant and the additional discovery request comprises an impermissible fishing expedition, presumably for tactical reasons.

48    The applicant makes similar submissions in relation to the tax returns referred to in para 1(1)(d) of the motion. It says these are completed on a consolidated basis for all jobs and there is no separate record for the project in the applicant’s tax returns for the 2006, 2007 or 2008 financial years.

49    Accordingly, the applicant says the returns are irrelevant, comprising an impermissible fishing expedition and are not discoverable.

50    To an extent the applicant’s response to the request for further or continuing discovery of particular documents, including electronic documents, seems to combine the question of the complexity of production with the obligation of disclosure if it has documents answering the description of documents requested.

51    For example, para 1(1)(a) of the notice of motion requires discovery of “weekly, monthly or other periodical report relating to the financial performance of the applicant’s undertakings in respect of the respondent” for the noted periods.

52    While the language “applicant’s undertakings in respect of the respondent” is a little verbose and perhaps could have been more precise, it is nonetheless clear that it refers to the undertakings the subject of the proceedings and the applicant understands that. The question is whether there are any reports meeting the description given. If the correct answer is, from the applicant’s point of view, that there are no weekly, monthly or other periodical reports of that description, then dealing with the discovery request is a relatively easy matter.

53    If, however, there are such reports in existence or if such reports were once in existence, then discovery of them should be given.

54    In my view, it is neither here nor there that the reports, if they exist, may be in an electronic format.

55    Moreover, if the documents are in an electronic format, then discovery in that format may well prove to be a useful thing, not only in the conduct of the proceeding leading to trial, but also at trial.

56    The respondents are entitled to see the documents in their electronic form and, again, if they exist, they should be provided in native format.

57    That a party may have some difficulty in reading the electronic material provided, once again is neither here nor there. The applicant’s obligation is to make discovery.

58    I therefore see no proper grounds raised in opposition to the discovery request.

59    However, that I do not accept the respondent’s contention that reports concerning other “jobs” maintained within any relevant report described in the discovery request are relevant. I consider it is drawing a long bow, at least at this point in the proceeding, to say that the financial performance of the applicant in respect of undertakings that have nothing to do with the respondent’s contract are relevant to the calculation of loss and damage in this proceeding.

60    I recognise that it is possible that all that indirectly the way an entity ordinarily performs financially may be relevant to the way it performs financially in another area, but at least at this stage of the proceeding, the connection seems to me to be sufficiently remote not to require discovery of materials to do with undertakings not with respect to the respondent.

61    On the other hand, I consider that if there are any periodical financial statements or tax returns relating to the undertaking the subject of the proceedings, even if they have been prepared on a consolidated basis, they may be considered discoverable on the basis that they are not so remote to the inquiry into loss and damage that they should not be discovered at this point. If the financial statements and tax returns of the applicant have been prepared on a consolidated basis in respect of which masking of irrelevant material is not possible, that may make any useful inquiry into them, from the respondent’s point of view, difficult, but that does not of itself make them irrelevant.

62    Therefore, in summary, it seems to me that the respondent is entitled to insist upon discovery of the finance database documents described in both paper form and in native electronic format.

63    Other financial reports and tax returns disclosing performance in relation to the undertaking the subject of the proceedings should be discovered.

64    Whether or not there are documents in the possession, custody or control of the applicant, or documents that have been in the possession, custody or control of the applicant is another thing. That will become clear in the course of discovery being given.

65    The applicant should pay the costs of the application.

applicant’s notice of motion for particular discovery

66    By notice of motion filed 9 October 2009, the applicant seeks particular discovery of a large number of drilling and related records to do with the performance of the work the subject of the application in this proceeding.

67    The applicant seeks to justify its application on the basis that the documents are referred to in pleadings or are suggested as being relevant by the pleadings.

68    The respondent resists discovery of the documents on the basis that the initial discovery order made 16 October 2008 was only for general discovery under O 15, r 2(3) FCR and it is not required therefore to discover all documents that might lead to a train of inquiry or which might merely throw light on the case.

69    The respondent acknowledges, however, that O 15, r 8 – under which the applicant makes the current application – the Court may order particular discovery, but correctly notes there are prerequisites to the exercise of the Court’s discretion. In McIlwain v Ramsay Food Packaging Pty Ltd [2005] FCA 1233 at [25]-[30], Greenwood J considered the authorities and the general principles relating to the exercise of the discretion that the Court has under O 15, r 8 to order additional discovery. His Honour made the following points:

    A party dissatisfied with the completeness of discovery by another party might seek to identify either a document or a class of document as the focus for an application.

    That document or class of document must relate to a matter in question in the proceeding.

    The grounds for a belief that some document or class of document relating to a matter in question exists can be demonstrated to the Court either from evidence adduced by the applicant for the order or from the nature or circumstances of the case, reflected in the pleadings or from any document filed in the proceedings.

    The applicant must then demonstrate that such a document or class of document either may be or may have been in the possession, custody or power of a party.

    Once those matters are demonstrated, the Court may order such party to file an affidavit stating whether that document or any document of that class is or has been in the possession, custody or power of the party.

    The focus of the inquiry is not surprisingly directed towards identifying the existence of a particular document or class of document because the party seeking an order for particular discovery will already have had the benefit of general discovery or discovery in some appropriate terms.

    It may, however, emerge in a particular case that a party has excluded a class of documents based on a misunderstanding of the relevance of that class to issues reflected in the pleadings.

    The rule confers a discretion to require particular discovery of the document or class of documents which relate to any matter in issue in the proceedings, even though the party from whom the document or class of document is sought may not have joined issue with the applicant for particular discovery on the pleadings.

    The rule is not limited to a case of defective compliance with an earlier order.

    The requirements of the rule are not to be avoided by simply issuing a subpoena duces tecum upon an opposing party.

70    In general terms, the Court has a discretion to require discovery of a wider class of documents than those contemplated by O 15, r 2(3). But the respondent says the prerequisites are not met.

71    I will deal with each of the requested documents in the order they appear in the notice of motion.

(a)    All records of dipping by Orica Australia Pty Ltd (Orica) of holes drilled by CQ Drilling and Blasting Pty Ltd (CQ Drilling) at the respondent’s Sarsfield open pit mine at Ravenswood, Queensland (Mine) during the period November 2007 to the date of the motion (Period).

72    The dipping records that the applicant seeks post date the termination of the contract between the applicant and the respondent the subject of these proceedings. Nonetheless, the applicant says the records are relevant because:

(1)    of matters referred to in [11] of Mr Panotidis’ affidavit, made October 2009;

(2)    the applicant alleges and the respondent denies that the respondent purported to terminate the contract the subject of the proceedings because it had formed the opinion as defined in the reamended statement of claim;

(3)    the respondent alleges in its current reamended defence and crossclaim and the applicant denies that the respondent terminated the contract for the reasons sets out in [27] of the defence and crossclaim including because the applicant regularly drilled holes which did not conform to the contract specifications for hole depth, angle and location;

(4)    the question of whether CQ Drilling regularly drilled holes which did not conform to the specifications of hole depth, angle and location in the contract between the respondent and CQ Drilling (the CQ Drilling contract) is relevant to the veracity of the respondent’s allegation because, if CQ Drilling did so, the respondent did not terminate its contract with CQ Drilling for that reason.

73    The respondents says that as a matter of logic, the latter proposition put by the applicant is flawed. There is no logical reason why one fact must follow the second.

74    The respondent says the applicant’s proposition could perhaps be better stated as follows: if the respondent terminated the contract for the first reason, it must follow that the respondent would have terminated the engagement of CQ Drilling if its conduct was the same as (or was less satisfactory than) the unsatisfactory conduct. Unless stated in this manner, the conduct of CQ Drilling must be irrelevant to the matters in question in these proceedings.

75    The respondent says that to the extent that any paragraph of the applicant’s motion relies on the proposition it should be denied for the following reasons:

(1)    There is no basis to suggest that the conduct of the CQ Drilling was the same as or less satisfactory than the unsatisfactory conduct pleaded in respect of the applicant.

(2)    Even if the conduct of CQ Drilling was the same as or less satisfactory than the unsatisfactory conduct, the proposition is flawed and cannot rationally affect directly or indirectly the assessment of the probability of the existence of a fact in issue in the proceedings because;

    The conduct is not comparable because the duration of the conduct differs.

    The conduct is not comparable because the conduct occurred at different proximities to the end of the life of the applicant’s mine. Even if the conduct of CQ Drilling was the same or even less satisfactory than the unsatisfactory conduct, at some point the limited remaining life of the mine must become not only a factor, but a factor of increasing importance in any decision whether to terminate the engagement of a drilling contractor, such as CQ Drilling.

    The conduct is not comparable because the conduct occurred in relation to different areas of the pit.

    The conduct is not comparable because even if the conduct of CQ Drilling precisely replicated or was less satisfactory than the unsatisfactory conduct, there might have been additional considerations which the respondent might have taken into account.

    The conduct is not comparable because of the simple fact that the termination of the contract resulted in the applicant commencing this action, which may have directly impacted on the likelihood that the respondent would terminate the engagement of CQ Drilling in similar circumstances.

(3)    Alternatively, the relevance or benefit of CQ Drilling documents are so marginal that particular discovery is not warranted.

76    The applicant draws attention to the pleadings in rejecting the respondent’s analysis.

77    Paragraph 27 of the reamended statement of claim filed 9 October 2009 pleads that on or about 30 October 2007 by notice of that date from the respondent to the applicant, the respondent purported to terminate the contract effective 30 November 2007, pursuant to cl A20.2 of the contract.

78    By para 27(c) of the further reamended defence and crossclaim filed 29 October 2009, the respondent says that it gave notice to the applicant of termination of the contract under that clause for the following reasons:

(1)    By the time that the notice of termination was given, the applicant’s performance of the services supplied under the contract was regarded as being unacceptable to the respondent. Particulars are given.

(2)    The monthly rate of drilling that the applicant had achieved was regularly less than the rate that had been estimated in the indicative drilling program.

(3)    The contract rates sought and claimed by the respondent for the year ending 30 June 2008 were contrary to those specified in by the contract and in excess of rates that the respondent considered to be reasonable.

(4)    The respondent considered that the relationship between the applicant and the respondent created by the contract and the provision of drilling services by the applicant to the respondent, pursuant to the contract, had broken down by reason of matters particularised earlier.

79    However, nowhere in the particulars provided or in these aspects of the pleading is the subsequent performance of CQ Drilling mentioned or used for the purpose of the case put by the respondent.

80    I do not consider that the CQ Drilling records should be considered relevant, at least at this point on the basis contended for.

81    Whether or not a later contractor engaged by the respondent to undertake similar work, or the same work as that previously conducted by the applicant, was done in an unsatisfactory state, but that contractor did not have its contract terminated for unsatisfactory performance, cannot in my view be considered relevant to the question whether or not the applicant breached the terms of the contract it had with the respondent. As the respondent points out there could be a variety of reasons why one party to a subsequent contract may not terminate the subsequent contract, even though it had terminated an earlier similar contract for similar unsatisfactory performance. It says nothing about the material breach allegations in relation to the first contract. The most that can be said is that the respondent may have applied a double standard. But that is entirely beside the point.

82    The applicant says that it must also be borne in mind that the applicant pleads in its current further reamended reply and defence to crossclaim, dated 5 March 2009, that it denies that excessive redrilling was required, that its safety management system was inadequate and that the metres drilled by the applicant were regularly less than the metres specified in the drilling program due to the conduct of the respondent.

83    These pleas do not, in my view, alter this basic assessment.

84    I would not require particular discovery of this category of documents.

(b)    All records of drilling by CQ Drilling at the Mine during the Period including, but not limited to daily timesheets/blast hole depth sheets.

85    The applicant relies on matters set out in paras 13 and 14 of Mr Panotidis’ affidavit.

86    Mr Panotidis says it is apparent from his inspection of the documents discovered that the respondent has not discovered a range of:

    Timesheets for the period 2008 onwards.

    Legible or complete timesheets for drilling carried out by CQ Drilling on the dates recorded in certain timesheets.

    All records of drilling carried out by CQ Drilling at the Mine between November 2007 and 2008 by reference to certain documents.

87    In this regard the respondent says that its general discovery affidavit should be considered conclusive. It made 1300 daily timesheets/blast hole depth sheets available in an endeavour to reduce costs delay and address the concerns of the applicant. It is concerned that discovery process through this request is becoming oppressive.

88    While the respondent says it has previously provided documents concerning CQ Drilling, and while the applicant has not expressly relied upon the proposition it advanced in respect to the documents requested in (a), the respondent nevertheless relies upon its response to that proposition.

89    The respondent challenges the relevance of the documents to any matter in question in the proceeding.

90    In my view, the documents in (b) are not discoverable at this point. Having regard to my reasons for refusing production of documents in (a) I have a difficulty in seeing the relevant of the documents in (b) at this point of the proceeding.

(c)–(i)

91    The applicant requires the production of documents to do with the performance between CQ Drilling and the respondent during the period November 2007 to the date of the notice of motion. In relation to all of these requests the basic proposition put forward by the applicant in relation to its request for the documents (a) is relied upon. For the reasons I have given in relation to refusing that request, I would also deny the applicant’s requests under these categories.

(j)    All daily performance reports for the Mine during the period October 2005 to November 2007.

92    The request for documents does not directly involve CQ Drilling.

93    The applicant refers to attachment LP8 to the affidavit Mr Panotidis and says this is the only daily performance report which has been discovered by the respondent.

94    It says it can reasonably be inferred from the title and format of attachment LP8 to that other daily performance reports must exist.

95    It says the respondent alleges in its defence and crossclaim, and the applicant denies, that the respondent terminated the contract for the reasons set out in [27] of the defence and crossclaim including because the applicant’s daily metre drills were irregular and a monthly rate of drilling it achieved was regularly less than the rate that had been estimated in the indicative drilling program.

96    The respondent makes the point that annexure LP8 does not disclose any drilling information. It does not disclose “any daily metre drills” or any “rates of drilling”. It does disclose volumes and tonnages of material mined and processed.

97    I accept the respondent’s submissions in this regard and would refuse further discovery under this category.

(k)    All survey drill plans provided by the respondent to the applicant during the period September 2005 to November 2007.

98    The applicant says the respondent has discovered certain but not all survey drill plans for the design, loaded, boundary pick up and main boundary shots for the period September 2005 to November 2007.

99    Mr Panotidis in his affidavit refers to attachment LP11, which is a schedule of shot numbers referred to in annexure A to the particulars of defence, but which are not included in the survey drill plans discovered by the respondent.

100    He says attachment LP11 also includes a schedule of shot numbers referred to in survey drill plan as discovered by the respondent which were not included in annexure A to the particulars of defence.

101    The respondent says that under O 15, r 2(4) FCR a party is not required to disclose a document if the party reasonably believes that the document is already in the possession and custody or control of the party to whom discovery is given.

102    I agree with the respondent that as these are documents that were provided at an earlier time during the currency of the contractual arrangements it may be expected that the applicant has those documents.

103    The respondent also notes that in its discovery the applicant does not list the documents as either being in its possession or once having been in its possession.

104    I would refuse discovery of this class given the absence of explanation by the applicant as to why it does not have the documents that ostensibly were once given to it.

(l)    All turnstile records for the dates listed in annexure C to the respondent’s further answers to the applicant’s request for particulars dated 11 August 2009.

105    The applicant says that it believes the respondent maintained turnstile records (a register of all entrants to site) for the Mine during the period October 2005 to November 2007, which the respondent has not discovered.

106    The respondent alleges in its defence and crossclaim and the applicant denies that the respondent terminated the contract because amongst things the applicant’s operators who did not show for work were not replaced. Further particulars of the allegation are contained in annexure C to the respondent’s further answers to the applicant’s request for particulars dated 11 August.

107    The applicant says the turnstile records for each of the dates are therefore plainly relevant and discoverable.

108    The respondent says that the class of documents can be identified and collated with little cost and it does not take issue with this claim.

109    I will order discovery of the documents referred in (l).

(m)    All emails (including attachments) between Mr Warren Symons of the applicant and Mr Craig Stewart of the respondent sent on 20 or 21 September 2005 with the subject “Labour Price Index”.

(n)    The attachments to the email from Mr J Meldon of the respondent to Mr Warren Symons of the applicant, dated 20 September 2005 with the subject “Labour Price Index”.

110    The applicant says the respondent has discovered emails but not the attachments to the ones described.

111    The respondent says that under O 15, r 2(4) a party is not required to disclose a document if the party reasonably believes the document is already in the possession, custody or control of the party to whom discovery is given.

112    In its reply submissions, the applicant says it does not have the attachments.

113    In these circumstances, discovery should be given of these documents.

(o)    The signed copy of the letter from Mr Simon Brady of the respondent to Mr Darren Key, dated 17 April 2007 and the “list of issues and other comments” referred to in the first paragraph of the letter.

114    The applicant says the copy of the unsigned copy of the letter in question is produced but the applicant does not have a signed copy of the letter or the list referred to.

115    The respondent says the applicant has not established any grounds for the relief in effect that the document is of some importance.

116    I agree. If the letter is important the notice to admit can be given.

(p)    All preshift information reports, including attachments, for the Mine during the Period.

117    The applicant, by its reply submissions, no longer presses this category.

(q)    All geologists’ reports regarding the Mine.

118    The applicant says the respondent has not discovered any geologist’s reports regarding the Mine.

119    The applicant says the geologist reports are relevant to allegations contained in para 27 of the defence and crossclaim because they concern the geological characteristics of the mine site and are therefore relevant to questions of whether the rates of drilling were achievable and whether the applicant is partly or solely responsible for a failure to achieve a rates of drilling estimated in the respondent’s drilling programs.

120    The respondent says that para 27 of the defence and 8(m) of the reply do not put in issue whether drilling estimated in the respondent’s indicative drilling programs were achievable. The respondent also questions how these documents relate to any matter in question in the proceeding because the applicant pleads in para 21(c)(i) of its pleading that it was an express term of the contract that the applicant was required to provide contract drilling services in accordance with the contract drilling program. The claim and reply do not refer to “geological characteristics” of the land etc.

121    The respondent also complains that the request is too wide, lacks specificity and is oppressive.

122    I agree with the respondent’s submissions. The request is not at all refined and is oppressive. I also doubt its relevance to the matters pleaded.

(r)    All documents, including but not limited to notes and calculations, regarding the respondent’s design of the pit at the Mine and created during the period January 2005 to January 2009.

123    I agree with the respondent’s complaints that this request does not readily explain the relationship between the documents required and matters in question in the proceeding. In particular, para 27 of the defence and para 8(m) of the reply do not put in issue whether drilling estimated in the respondent’s indicative drilling programs were achievable. There is no clear issue about the geological characteristics of the site.

124    The class of documents is very broad.

125    The applicant is not prevented, by not having a complete dossier of documents, from pursuing the issues it says are relevant in the proceeding at the trial and that line of argument indicated can be pursued at trial if necessary.

(s)    All Monthly Drill Meters Required Reports for the Mine for the period October 2005 to the date of the motion.

126    By its reply submissions, the applicant no longer presses this request.

(t)    All rain gauge reports for the Mine for the period October 2005 to January 2009.

127    The respondent indicates that it does not wish to take issue with this class of documents. They have now been discovered.

(u)    All documents recording the number of metres of reverse cycle drilling carried out at the Mine during the Period.

128    The applicant says that the quantity of reverse cycle drilling carried out at the Mine after November 2007, which would have been carried out by the applicant had the contract not been terminated is directly relevant to the calculation of its claim for loss and damage.

129    The respondent says it has made available for inspection a copy of the CQ Drilling tax invoices and it is apparent that they set out the actual number of metres undertaken by CQ Drilling during the period and the amounts paid by the respondent to CQ Drilling.

130    However, in its reply submissions the applicant says the respondent’s submissions are disingenuous and the invoices do not set out the number of metres of reverse cycle drilling by CQ Drilling.

131    Relying on the submissions of the applicant, I consider that further discovery of this class of documents is required.

(v)    All videos of blasting undertaken by Orica during the period October 2005 to November 2007.

132    These documents have now been discovered.

(w)    All records of occupational health and safety incidents and the Mine, including but not limited to all records entered into the respondent’s database of incidents regarding those incidents occurring during the period October 2005 to November 2007.

133    The respondent submits that it did discover documents of the class referred to and challenges the applicant’s assertions that it has not discovered any incident investigation reports. The respondent refers to para 5(E) of Pt 1 of Sch 1 of the list of documents.

134    The applicant says the documents discovered only cover the applicant’s personnel, not all other personnel.

135    Relying on the applicant’s submission, I would order further discovery under this category.

(x)    Extracts from the diary of Mr Craig Stewart regarding the project and created during the period June 2005 to December 2007.

136    The respondent has taken steps to contact Mr Stewart who has agreed to make his 2007 diary available for inspection.

137    In these circumstances, I do not consider that discovery need be ordered.

138    In my view, the respondent is the overall successful party in relation to the applicant’s request for more particular discovery and the applicant should pay the respondent’s costs to be taxed if not agreed in relation to this notice of motion.

orders

139    In relation to the respondent’s notice of motion, filed 29 September 2009, the Court orders that:

1.    Within 14 days following the date of this order, the applicant by its director, Warren Mark Symons, file with the Court and serve on the respondent an affidavit stating whether any document of the following class is or has been in the applicant’s possession, custody or power and, if it has been but is not then in the applicant’s possession, custody or power, when the applicant parted with it and what has become of it.

(a)    Any weekly, monthly or any other periodical report, relating to the financial performance of the applicant’s undertakings in respect of the respondent for any period within 1 July 2005 to 31 January 2008.

(b)    Any weekly, monthly or any other periodical report of the applicant’s undertakings which partly includes, and incorporates or summarises financial information relating to the financial performance of the applicant’s undertakings in respect of the respondent for any period within 1 July 2005 to 31 January 2008.

(c)    Any annual or quarterly financial statements of the applicant for the years ending 30 June 2006, 30 June 2007 and 30 June 2008 relating to the financial performance of the applicant’s undertaking in respect of the respondent.

(d)    Any tax return of the applicant for the years ending 30 June 2006, 30 June 2007 and 30 June 2008 relating to the financial performance of the applicant’s undertaking in respect of the respondent.

2.    The applicant pay the respondent’s costs of incidental to the notice of motion to be taxed if not agreed.

140    In relation to the applicant’s notice of motion, filed 9 October 2009:

1.    Subject to Order 2, the notice of motion be dismissed.

2.    The respondent give discovery of the documents referred to in para 1(l), (m), (n), (u) and (w) as soon as practicable.

3.    The applicant pay the respondent’s costs of the notice of motion to be taxed if not agreed.

Associate:

Dated:    22 December 2010