Got a hunch? Navigating the rules of preliminary discovery
The rules of most Victorian courts permit a party, in certain circumstances, to obtain discovery of material prior to commencing proceedings. This is especially vital in assisting a party to ascertain who, or by what cause of action, it can sue. Like many rule-based tests, there can be some confusion about the requirements, as well as the discretionary factors, for obtaining preliminary discovery. The Supreme Court in a recent appeal decision in Alex Fraser Pty Ltd v Minister for Planning[1] has shed some light.
The facts
In 2014, the Kingston City Council proposed to amend the planning scheme for an area of land originally set aside for waste recycling facilities, The amendment sought to rezone that land to parkland. Hoping to take advantage of the recycling permit and being not altogether pleased with the potential rezoning, the appellant lodged an objection with the Council over its proposal.
In due course, the Council requested that the Minister for Planning appoint a panel to consider the various planning objections and submissions. In May 2015 and despite the panel’s recommendations that the rezoning not proceed, the Council adopted the proposal and resolved to submit it to the Minister for approval.
By letter in August 2015, the appellant wrote to the Minister and made submissions as to why the rezoning proposal ought not be approved. Ultimately, the Minister approved the rezoning.
The appellant sought and obtained via an FOI Act request some documentation — albeit in redacted form — regarding the Minister’s decision. Not being content with redacted versions of the documents, the appellant applied to the Supreme Court for an order for preliminary discovery that would require the Minister to discover all documents he had relied upon or considered in reaching his decision to approve the rezoning. The case the appellant sought to bring was that the Minister’s decision had been made for an improper or extraneous purpose.
The associate judge refused the application. The appellant then appealed this decision to a judge of the Supreme Court, arguing that the associate judge erred in applying the rule in question.
The relevant rule
The application for preliminary discovery was brought under rule 32.05 of the Supreme Court (General Civil Procedure) Rules 2015. That rule states:
‘Discovery from prospective defendant
Where—
(a) there is reasonable cause to believe that the applicant has or may have the right to obtain relief in the Court from a person whose description the applicant has ascertained;
(b) after making all reasonable inquiries, the applicant has not sufficient information to enable the applicant to decide whether to commence a proceeding in the Court to obtain that relief; and
(c) there is reasonable cause to believe that that person has or is likely to have or has had or is likely to have had in that person's possession any document relating to the question whether the applicant has the right to obtain the relief and that inspection of the document by the applicant would assist the applicant to make the decision—
the Court may order that that person shall make discovery to the applicant of any document of the kind described in paragraph (c).’
The decision on appeal
The appeal was heard before Riordan J. Addressing the question of whether the associate judge erred in applying the rule for preliminary discovery, his Honour noted that the argument originally before the associate judge was confined to rule 32.05(a) — that is, the ‘reasonable cause to believe’ requirement. His Honour made a few key comments about how the rule ought be applied.
First, where the associate judge had identified the main issue in the preliminary discovery application as being whether there was sufficient evidence to suggest that the appellant’s ‘subjective belief’ was reasonable, Riordan J stressed that the test is entirely objective, noting:
‘[Rule 32.05(a)] does not direct attention to any belief of the applicant. Rather it requires reasonable cause for a hypothetical belief’.[2]
Second, his Honour noted that various judicial formulations and expressions regarding the quality of belief were of little assistance. In particular, use of the antonyms ‘suspicion or hunch’ were not useful because they are not necessarily exclusive of a ‘reasonable cause to believe’. For his Honour, those other terms were useful only insofar as they emphasised the need for there to be more than a belief — the belief must be reasonably held. Returning to the text of the rule, his Honour held that:
‘The critical element of the test is reasonableness rather than whether the circumstances would cause a belief as opposed to a suspicion or some other hypothetical state of mind. A reasonable belief may incorporate elements of each of these putative antonyms’.[3]
Delving briefly into semantics, his Honour concluded that ‘a reasonable suspicion, conjecture or assertion may each fall within the ambit of a reasonable belief’.[4]
Third, and in a way summarising his previous comments, Riordan J concluded that ’the jurisdictional threshold under r 32.05 is low’.[5] This was so in light of the purpose of the rule — that it is designed to allow a prospective plaintiff to ascertain a proper basis for suing (thereby linking it to the requirements of the Civil Procedure Act 2010). His Honour also noted that it would be ‘incongruous’ to require a certain strength of evidence in support of an application for preliminary discovery in circumstances where the purpose of the application itself is to gather evidence.
Finally, his Honour stated that, notwithstanding the low threshold for a preliminary discovery application, ‘its satisfaction only empowers the Court to exercise its discretion’[6] and that such discretion would be governed by the interests of justice in light of a number of factors. Those factors included:
The cost and inconvenience to the respondent, and whether the respondent will be reimbursed for its costs.
The potential for discovery to cause commercial or other damage to the respondent.
Whether the documents sought are privileged.
The prospect of the documents sought actually assisting the applicant.
Whether there is a real prospect of success or whether the discovery process will serve a useful purpose.
On the last point, his Honour noted that ‘delving extensively in the merits of the existence of a possible cause of action will usually not be appropriate’.[7]
Turning to the associate judge’s decision, his Honour held that the associate judge erred in applying rule 32.05 for failure to ask whether there was a reasonable cause to believe the appellant may have a right to relief. Taking the wording in rule 32.05(a) to comprise two limbs — whether there is reasonable cause to believe that the appellant ‘has’ (the first limb) or ‘may have’ (the second limb) a right to obtain relief — his Honour identified particular parts of the associate judge’s decision which suggested that the judge had only determined whether the appellant ‘had’ a right to relief against the Minister and not whether the appellant ‘may have’ such. In other words, the associate judge failed to apply both limbs of rule 32.05(a).
Having found error in the associate judge’s decision, Riordan J granted the application for preliminary discovery, noting that ‘it can be reasonably expected that the redacted material will be critical in disclosing the purpose of the Minister in approving the Planning Scheme Amendment’.[8] For the Minister’s part, his Honour noted that preliminary discovery of the material would involve no undue inconvenience to the Minister given the material had already been disclosed — it simply needed to be produced without redaction this time.
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A version of this case note subsequently featured in the Commercial Bar Association’s blog, the CommBar Law Digest. It can be viewed here.
[1]: [2018] VSC 391.
[2]: Ibid [48].
[3]: Ibid [51].
[4]: Ibid [52].
[5]: Ibid [54].
[6]: Ibid.
[7]: Ibid.
[8]: Ibid [63].