Court debates whether orders for discovery are limited to existing documents

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A discovery dispute in the class action against ANZ leads to the court determining that the limits of discovery orders are not fixed, as they criticise the respondents for lack of proper conferral with the applicants’ solicitors.  

This was a discovery dispute in a class action against ANZ in relation to certain consumer credit insurance policies – one policy that insured certain liabilities under credit cards, and the other which insured liabilities under personal loans.

Two previous sets of discovery orders had been made, with one outstanding category (Category 3) to be resolved. Category 3 was the subject of this application and sought detailed information in respect of each relevant insurance policy in force since 1 January 2009 including the policy identifier, the policy type, the date of issue, the channel of sale, policyholder details including date of birth and employment status, total premiums paid and information about claims made on the policy. The application for Category 3 was supported by a short expert report by the applicants’ intended actuarial expert.

There had been limited engagement between the parties about Category 3 prior to the last hearing and O’Bryan J had deferred any ruling on Category 3 to afford the parties further time to confer in relation to the data sought, including as to the extent of data available and how it might be extracted, with the aim of either reaching agreement about the discovery to be given or adducing evidence about the availability (and, if contested, relevance) of the data sought.

Since then, the applicants and the forth respondent (QBE) had reached agreement about Category 3 and orders were to be made. The applicants and the first to third respondents (ANZ and OnePath) remained in a narrow scope of disagreement.

Notably, before turning to the narrow area of disagreement, his Honour made some observations at [9] about the failure of ANZ and OnePath to confer properly with the applicants about the information relevant to if, where and what form of data may be available for discovery. His Honour noted at [11] that while the Court can require a respondent to disclose this by way of affidavit, in cases involving experienced practitioners, such information should be exchanged by way of frank and meaningful correspondence. Doing so enables parties to reach a cost-effective solution to the discovery task, consistent with their s 37N obligations, even if a respondent may properly maintain an objection after such consultation. His Honour was critical of the respondents’ lack of proper conferral with the applicants’ solicitors, noting that their correspondence was “declarative and combative in tone and uninformative in content” (at [12]). 

At [13], his Honour also noted that, while discovery does not ordinarily require a party to bring into existence documents (including data) that do not exist, the proper limits of discovery orders are not fixed and the Court has undoubted power to require a litigant to produce on discovery data in particular formats, which may include straightforward data merging.

His Honour then went on to consider the three areas of dispute, relating to the respondents’ proposed amendments to the applicants’ Category 3. The first issue related to the definition of ‘policies’ in respect of which data was to be produced. Unconvinced that the respondents had explained why they were unable to export data in a way that was limited to the relevant policies, his Honour did not accept the change. 

His Honour was willing to accept the two other amendments proposed by the respondents: firstly, in relation to providing personal details about policyholders at the time of the point of sale, and secondly, in relation to data about premiums paid on the policies. 

Significantly, his Honour ordered costs of the application against the first to third respondents. At [19], his Honour noted that in cases where there are frequent interlocutory disputes concerning pleadings and discovery, usually the Court would order that the costs of such disputes are costs in the cause, but that if the Court views that one of the parties has acted unreasonably in respect of the dispute, costs may be awarded in favour of the other party. This was such a case and his Honour thought it appropriate to mark the Court’s disapproval of the approach taken by the first to third respondents: 

I consider that in the period after the hearing on 12 November 2021 ANZ and OnePath failed to consult in a reasonable manner in relation to discovery category 3; the basis on which they proposed to give discovery was unclear; and ultimately they abandoned their position and agreed to give discovery largely in the form sought by the applicants. I acknowledge that, in the overall context of this litigation and the costs being incurred by each party, the costs associated with the present application for discovery from ANZ and OnePath might be described as trivial. Nevertheless, the principles upon which costs are ordered in such applications are not trivial and serve to mark the Court’s disapproval of the approach taken to this aspect of discovery by ANZ and OnePath.

Reilly v Australia and New Zealand Banking Group Ltd (No 4) [2021] FCA 1552

Federal Court of Australia, O’Bryan J  
10 December 2021

Applicants’ Solicitors: Slater and Gordon;
Solicitors for First, Second & Third Respondents: Herbert Smith Freehills;
Solicitors for Fourth Respondent: Gilbert and Tobin;
Applicants’ Funder: N/A

Austlii Link: Available here

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