Federal Court of Australia

Bluetag Australia Pty Ltd v BCC Trade Credit Pty Ltd trading as Bond and Credit Co (No 2) [2025] FCA 992

ORDERS

THE COURT ORDERS THAT:

1.    The first and second respondents be granted leave to apply for orders under 28 USC §1782 in the United States District Court for the District of Delaware seeking documents from GT Commodities LLC, substantially as described in categories 6-10 of the draft application exhibited to the affidavit of Penelope Caroline Taylor sworn 12 August 2025.

2.    The first and second respondents serve on the applicants and the third respondent a copy of any application and any accompanying supporting materials within 3 days of being filed in the United States District Court.

3.    Costs of this interlocutory application be costs in the cause.

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

REASONS FOR JUDGMENT

(Delivered ex tempore)

STEWART J:

1    The first and second respondents (the insurers) apply for “permission” of the Court to apply to the United States District Court for the District of Delaware for orders under 28 USC § 1782 to obtain certain documents from GT Commodities LLC. GT Commodities is incorporated in Delaware, USA.

2    The cited section in the United States Code (US) relevantly provides as follows:

§ 1782. Assistance to foreign and international tribunals and to litigants before such tribunals

(a)     The district court of the district in which a person resides or is found may order him to give his testimony or statement or to produce a document or other thing for use in a proceeding in a foreign or international tribunal … . The order may be made pursuant to a letter rogatory issued, or request made, by a foreign or international tribunal or upon the application of any interested person and may direct that the testimony or statement be given, or the document or other thing be produced, before a person appointed by the court. … The order may prescribe the practice and procedure, which may be in whole or part the practice and procedure of the foreign country or the international tribunal, for taking the testimony or statement or producing the document or other thing. To the extent that the order does not prescribe otherwise, the testimony or statement shall be taken, and the document or other thing produced, in accordance with the Federal Rules of Civil Procedure.

    A person may not be compelled to give his testimony or statement or to produce a document or other thing in violation of any legally applicable privilege.

(b)    …

3    The applicants do not oppose or wish to be heard on the application. They have been excused from attending the hearing today. The third respondent takes a similar position.

4    In support of the application, the insurers rely on the affidavits of Ms Penelope Taylor sworn 12 August 2025 and Mr William Brennan affirmed 22 July 2025, and the exhibited documents to those affidavits. Ms Taylor’s affidavit exhibits the proposed form of the § 1782 application listing the documents that would be sought by subpoena in the US. Mr Brennan’s affidavit speaks to matters of US law in his capacity as a US attorney.

5    For the reasons that follow I will grant the relief that the insurers seek.

Background

6    It is necessary to give some background to the substantive dispute.

7    This proceeding is one of several which arise in similar circumstances. In short compass, they involve the applicants as insureds pursuant to policies of trade credit insurance issued by supply chain insurers. The applicants have been denied indemnity by the insurers in each case because they dispute that the facts give rise to the existence of an “Insured Debt”. That term requires the alleged debt for which indemnity is sought to involve a “Shipment”, meaning the passing of “physical control” of the goods the subject of the trade in question. Whether or not insurable trades occurred as pleaded by the applicants forms a key issue in the proceeding.

8    Five bills of lading which pertain to two of the underlying trades in dispute list GT Commodities as the notify party. The insurers seek the production of documents from the notify party as, according to Ms Taylor, it is often the intended “recipient” of the commodities referred to in the bills of lading, the agent of the “recipient”, or otherwise has knowledge of the ultimate “recipient” such that “it is likely that GT Commodities has knowledge of the party or parties who received the commodities relevant” to the trades in dispute. As the insurers state in their submissions, the documentation that is sought, “insofar as it demonstrates the actual trades that occurred in respect of the [bills of lading], including the vendor/purchaser supply chain, is relevant to the alleged involvement of the insured in those trades and the existence of the trades as pleaded.”

9    Only categories 6-10 in the proposed § 1782 application refer to documents which relate to the issues in this proceeding. Each category is directed to each of the five bills of lading and follows the following format:

Any and all Documents related to a document titled bill of lading with reference number […] and referred to at paragraph […] of the Bluetag Amended Defence, including, but not limited to:

a.    Any purchase or sale(s) contracts for the purchase or sale of the commodities described in bill of lading […].

b.    Any invoice(s) for the purchase or sale of the commodities described in bill of lading […].

c.    Any certificates, bills of lading, survey reports, customs reports or other Documents relevant to the commodities described in bill of lading […] sent by GTC to the purchaser of those commodities or received by GTC from the seller of those commodities for any purpose, including for the purposes of effecting payment.

d.    Any Documents and/or Communications evidencing the exchange, passing, or transfer, and the timing of that exchange, passing, or transfer, of any Documents mentioned in paragraph [...] c above.

e.     All Communications and other Documents relating to the formation of the sales contract between GTC and the seller / purchaser of the commodities described in bill of lading […].

10    The other categories relate to parallel proceedings underway in the Supreme Court of New South Wales. On 23 June 2025, Peden J of that Court made orders in a similar application for documents to be sought from GT Commodities in accordance with categories 1-5. For reasons of economy and efficiency (including limiting the ultimate burden on GT Commodities), the insurers intend to file one § 1782 application upon obtaining the leave of both this Court and the Supreme Court. Should leave from this Court not have been forthcoming, the § 1782 application would have been amended accordingly.

Principles of leave to bring a § 1782 application

11    Because GT Commodities is a Delaware corporation, the insurers require the assistance of the US courts to obtain documentary evidence by way of coercive process. That, as set out above, is governed by the terms of 28 USC § 1782.

12    At first blush, it might be thought that the kind of application before me is not even required. The express terms of § 1782 do not require leave from a court of the home jurisdiction of the proceeding for which the documents are sought. Nor do the Federal Court of Australia Act 1976 (Cth) (FCA Act), the Federal Court Rules 2011 (Cth) or any other form of applicable Australian enactment expressly require that such leave be obtained before commencing process in the US.

13    However, applications for permission to apply under § 1782 have become a not infrequent occurrence in recent years in the superior courts of Australia, particularly in this Court. As Stevenson J recounted in McAssey v Nemo (BC) HoldCo [2020] NSWSC 1893 at [8], since Jones v Treasury Wine Estates Ltd [2016] FCAFC 59; 241 FCR 111, “a practice has developed in the Federal Court of Australia whereby that Court’s approval is sought by a party to proceedings in Australia prior to the making by that party of a § 1782 application.”

14    That practice has developed not without sound reason. As his Honour explained (at [9]), “[t]he practice has developed that an application for approval of that nature is sought on notice to the parties to the local proceedings, with the object of avoiding the possibility of an application for an anti-suit injunction. The practice also permits the court to exercise supervision over its own processes.”

15    Relevantly, in Jones, a representative proceeding was underway in the Federal Court of Australia. The applicant and a class member, without notice to the docket judge, commenced ex parte proceedings in US courts, seeking and obtaining orders under § 1782 for depositions in the nature of oral discovery. The respondent applied for an anti-suit injunction in relation to the US proceedings whereupon the dispute was heard by the Full Court sitting in the original jurisdiction. The Court (Gilmour, Foster and Beach JJ) granted that relief. Central to its reasoning was the importance of ensuring under the overarching purpose in s 37M of the FCA Act the integrity of the Court’s processes (see at [23]-[25]). The Court observed (at [48]):

What is vital is that this Court’s proceedings and its pre-trial processes are solely subject to supervision by this Court, particularly where one is dealing with a class action which invokes the Court’s supervisory role. If orders for § 1782 depositions are to be permitted in a case, they should not be obtained by a party to proceedings in this Court without notice to the other party and without the prior knowledge and endorsement of this Court by appropriate directions. …

16    As Allsop CJ identified in White Oak Commercial Finance Europe (Non-Levered) Ltd v Insurance Australia Ltd [2022] FCA 1587 at [18], the basis of the Court’s power to grant such relief arises from s 23 of the FCA Act and r 1.32 of the Rules, which underlines the power to make orders as considered appropriate in the interests of justice. Whether what is granted is variously “approval”, “permission”, “endorsement” or “leave” appears to be of little moment: Alto Pty Ltd v General Motors Australia and New Zealand Pty Ltd [2023] NSWSC 759 at [94]-[95] per Meek J. The insurers use the language of “permission”, whereas I have preferred to use “leave” – that use follows White Oak and it best captures what the Court is doing in relation to the supervision of its own process.

17    The relevant principles for applications in the documentary context were set out by Perram J in Lavecky v Visa Inc [2017] FCA 454 at [18]-[19]:

[18]    … endorsement will generally be granted on ordinary case management principles; that is to say, given the circumstances of this case, would it be useful from a case management perspective to permit the Applicants to apply for the documents they wish to obtain … ? If so, what conditions should be imposed?

[19]    Whilst it is unwise to be definitive about these matters in advance, the following matters are likely to be germane …

(1)     What is the importance of the material to be sought under the procedure to the applicant’s case?

(2)     Are there other methods available for obtaining it?

(3)     Does the material sought impinge upon or undermine some important procedural limitation in this jurisdiction such as, for example, the unwillingness of the Court to permit fishing expeditions or, perhaps, the general unwillingness of this Court to order depositions?

(4)     What is the cost involved in the process for the parties before this Court?

(5)     Is that cost a proportionate burden having regard to the significance of the material?

(6)     Is the proposed proceeding under § 1782 in the District Court frivolous or obviously doomed to fail?

(7)     How long might the applications take to resolve and what impact might they have upon the timely preparation of the matter before this Court for trial?

(8)     Is there any need to impose conditions upon the endorsement so as to address any issues arising from (1)-(7) above?

Consideration

18    It is clear that the material to be sought by the insurers from GT Commodities is relevant and important to the issues in dispute – ie the existence of and status of the pleaded trades which are said to be insured, by reference to GT Commodities being the notify party on the relevant bills of lading. The clarification of that issue may be determinative of whether the trade credit insurance policy is responsive to the applicants’ claims. Ms Taylor deposes that at this stage, the insurers have not been supplied with any documents that confirm whether one of the applicants or alleged buyers was involved in a trade identified in the bills of lading, even after discovery. This being the case, any production resulting from the § 1782 application will necessarily result in new material.

19    Secondly, the insurers have been unable to access equivalent documentary information from within Australia and without foreign judicial assistance. Ms Taylor deposes that the insurers have corresponded with GT Commodities, but GT Commodities has indicated it is not willing to assist the insurers on a voluntary basis. As already mentioned, inter partes discovery has not been of assistance, nor have supplementary requests for information (including from the alleged buyers), nor third party sources of information. Ms Taylor deposes that there do not seem to be grounds on which GT Commodities could be joined to the Australian proceeding. It is also uncertain whether an Australian subpoena would be complied with in the same manner as one issued by a US court.

20    Thirdly, the applicants will incur no cost, and the insurers have indicated that they will cover GT Commodities’s reasonable costs and expenses of production. The insurers otherwise seek that the costs of the application be costs in the cause. The significance of the material is justifiably proportionate to the costs to be incurred by the parties, especially where the total quantum of the claims associated with the five bills of lading exceeds US$8 million.

21    Fourthly, Mr Brennan deposes that, based on his 24 years’ experience of practice as an attorney in the US, the District Court for the District of Delaware has jurisdiction to issue a documentary subpoena in response to the § 1782 application, and that if “the Australian Courts approve the making of the Application, the Application is likely to be successful and leave to serve a subpoena on GT Commodities is therefore likely to be granted.” Mr Brennan also deposes that the application will “typically be determined within two to three months from the time the application is filed”, with a subpoena being able to be issued immediately upon the grant of leave. While I accept that estimate, as Jackman J noted in Schiff v Nine Network Australia Pty Ltd (No 7) [2023] FCA 1432 at [11], the granting of an extension of time for production or the filing of a motion opposing the subpoena could prolong that process. However, unlike the situation in Schiff, this proceeding is not yet timetabled for final hearing – far from it. The parties have not even served evidence. I therefore consider that the potential delay in the US is not likely to delay any final hearing in Australia.

22    Finally, I consider the imposition of any conditions to be unnecessary in the circumstances detailed above, save that I will require that the § 1782 application be served on the other parties to this proceeding within 3 days of it being filed in the US. Since the parties have had notice of the present application, including the § 1782 application in draft, I do not consider that it is necessary that they be given 21 days’ notice of the § 1782 application (contra Lavecky at [38]).

23    I will accordingly grant relief substantially in the terms sought by the insurers.

Associate:

Dated:    21 August 2025

SCHEDULE OF PARTIES