Preliminary discovery December 27, 2015
McColl JA at 1; Young JA at 122; Sackville AJA at 161
UCPR 5.3 relevantly provides:
- (1) If it appears to the court that:
- (a) the applicant may be entitled to make a claim for relief from the court against a person (the prospective defendant) but, having made reasonable inquiries, is unable to obtain sufficient information to decide whether or not to commence proceedings against the prospective defendant, and
- (b) the prospective defendant may have or have had possession of a document or thing that can assist in determining whether or not the applicant is entitled to make such a claim for relief, and
- (c) inspection of such a document would assist the applicant to make the decision concerned,
the court may order that the prospective defendant must give discovery to the applicant of all documents that are or have been in the person’s possession and that relate to the question of whether or not the applicant is entitled to make a claim for relief.
- (3) Unless the court orders otherwise, an application for an order under this rule:
- (a) must be supported by an affidavit stating the facts on which the applicant relies and specifying the kinds of documents in respect of which the order is sought…”
47 First, “[i]n order for it to ‘appear’ to the Court that the applicant ‘may be entitled’ to make a claim for relief, it is not necessary for the applicant to show a prima facie or pleadable case”: Morton v Nylex (at ).
48 Secondly, while “the mere assertion of a case is insufficient…[i]t will be sufficient if there is reasonable cause to believe that the applicant may have a right of action against the respondent resting on some recognised legal ground” : Morton v Nylex (at ).
49 Thirdly, “belief requires more than mere assertion and more than suspicion or conjecture. [It] is an inclination of the mind towards assenting to, rather than rejecting a proposition. Thus it is not sufficient to point to a mere possibility. The evidence must incline the mind towards the matter or fact in question. If there is no reasonable cause to believe that one of the necessary elements of a potential cause of action exists, that would dispose of the application insofar as it is based on that cause of action”: St George Bank Ltd v Rabo Australia Ltd  FCA 1360; (2004) 211 ALR 147 (at (d)) per Hely J, referring in turn to John Holland Services Pty Ltd v Terranora Group Management Pty Ltd  FCA 679 (at , ,  and ) per Emmett J. The use of the word “may” indicates the court does not have to reach “a firm view that there is a right to relief”: Telstra Corp Ltd v Minister for Broadband, Communications and the Digital Economy  FCAFC 7; (2008) 166 FCR 64 (at ).
50 Fourthly, the requirement that the matters set out in UCPR 5.3 “appear[s]” to the court to establish an entitlement to an order under the rule may be wider than the requirement in the Federal Court Order 15A r 6 that there “is reasonable cause to believe”: see Panasonic Australia Pty Ltd v Ngage Pty Ltd  NSWSC 399; (2006) 69 IPR 595 (at ) per Young CJ in Eq; Papaconstuntinos v Holmes à Court  NSWSC 945 (at  per Simpson J; Hornsby Shire Council v Valuer General of NSW  NSWSC 1179 (at ) per Adams J. Nevertheless Hely J’s statement in St George Bank Ltd (at (e)) remains apposite, namely that “whilst uncertainty as to only one element of a cause of action might be compatible with the ‘reasonable cause to believe’ required by subparagraph (a), uncertainty as to a number of such elements may be sufficient to undermine the reasonableness of the cause to believe”.
51 Fifthly, “the question posed by [UCPR 5.3(1)(a)] … is not whether the applicant has sufficient information to decide if a cause of action is available against the prospective respondent [but]… whether the applicant has sufficient information to make a decision whether to commence proceedings in the Court. Accordingly, an applicant for preliminary discovery may be entitled to discovery in order to determine what defences are available to the respondent and the possible strength of those defences”: St George Bank Ltd (at (f)) (emphasis in original); see also Morton v Nylex (at ). Thus application of the rule will not be precluded by the fact that the applicant already has available evidence establishing a prima facie case for the granting of relief, as there might be matters of defence which could defeat a prima facie case: Alphapharm Pty Ltd v Eli Lilly Australia Pty Ltd  FCA 1500 (at ) per Lindgren J; referred to with approval by the Full Federal Court (French, Weinberg and Greenwood JJ ) in Telstra Corp Ltd (at ).
52 Sixthly, as Hely J said in St George Bank Ltd (at (a)), “the Rule is to be beneficially construed, given the fullest scope that its language will reasonably allow, with the proper brake on any excesses lying in the discretion of the Court, exercised in the particular circumstances of each case”.