Overriding purpose – still the most significant discovery in NSW

This article was co-authored by Clancy Petersen, Law Graduate, Sydney.

Summary

This matter concerns an application for discovery and comments on the application of Practice Note SC Eq 11 (the Practice Note) and the overriding purpose of CPA (s56) in determining whether general or category discovery should be ordered.

Here, in considering the application of the Practice Note and s56 of CPA, the Court determined that an order for general discovery was more appropriate than ‘category discovery’.

Appropriate form of discovery

The Practice Note is unique to the Equity Division of the NSW Supreme Court and, compared to other courts and lists, takes a very narrow and prescriptive approach to discovery. The Practice Note affirms that in this Division, discovery is not an automatic right and its purpose is to be precise and necessary in all respects. This also relates to assessing the appropriate form of discovery pursuant to the Practice Note.

For general discovery under UCPR Part 21, r21.1 defines what is meant by a matter or document being ‘relevant to a fact in issue’, namely if the document/matter contains material that could rationally affect the assessment of the probability of the existence of that fact regardless of whether the document/matter would be admissible as evidence. 

The Court commented that pursuant to r21.1, ‘category discovery’ has been considered the ‘norm’. Despite this, the Court ordered general discovery instead for the following reasons:

• It was a better means of achieving the overriding purpose as the issues in contention were ‘well-defined’ by the pleadings and evidence filed, and there was no ‘unusual or burdensome difficulty in the identification of documents relevant to a fact in issue…’[1], and moreover, there was a ‘real asymmetry’ of information in favour of the defendants which gave ‘rise to a real and not fanciful possibility of injustice in trying to ensure categories are adequate in the plaintiff’s interest’.[2]
• Moreover, with regard to s56 CPA, the Court noted that category discovery would likely incur a disproportionate costs and time spent in determining agreed upon categories and reviewing documents in accordance with the agreed upon categories, and that the Respondents did not satisfy the Court that general discovery would be more onerous or expensive in comparison to general discovery. Instead, it was likely that general discovery, for this matter, would instead save costs and time.
• S56 CPA remains a ‘touchstone’ of paragraph 5 of the Practice Note. The Court’s task is to ‘…fashion an approach which achieves the overriding purpose’.[3]

Implications

Although not ordered in this case, the Court did reinforce that in circumstances where ‘category discovery’ is ordered that parties must approach the task of formulating agreed upon categories in accordance with the overriding purpose (‘…co-operatively, realistically and proportionately in time and expense having regard to the issues genuinely in dispute’).[4]

The Court also confirmed that exceptional circumstances were not required to be shown in order to depart from the usual practice of ‘category discovery’ (assuming evidence is closed per paragraph 4 of the Practice Note).

 

[1] At [7].

[2] Ibid.

[3] At [12].

[4] At [15].