Commonwealth Bank of Australia v Daleport Pty Limited (in receivership) (No 3) [2017] NSWSC 1584

Commonwealth Bank of Australia v Daleport Pty Limited (in receivership) (No 3) [2017] NSWSC 1584

The funds allegation could not be dismissed as other than a real issue, and Daleport was not merely fishing because the pleaded issue concerned Bankwest's state of mind and potentially relevant documents would be in the Bank's possession. However, broad audit-type discovery into Bankwest's financial position was not...

Source-derived case information.

Jurisdiction
Australia
Judgment Date
21 November 2017
Procedural Posture
Civil Procedure Application for Discovery in Proceedings to Enforce Loan Facilities / Notice of Motion/application for Further Discovery of Documents Relating to the Funds Allegation
Outcome
Further discovery ordered in part.
Legal Topics
['discovery' 'relevance to a Fact in Issue' 'overriding Purpose' 'proportionality' 'oppression' 'misleading or Deceptive Conduct Set Off' 'loan Facilities']
['civil Procedure' 'banking and Finance' 'trade Practices'] ['discovery' 'relevance to a Fact in Issue' 'overriding Purpose' 'proportionality' 'oppression' 'misleading or Deceptive Conduct Set Off' 'loan Facilities']

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Procedural Posture

Civil Procedure Application for Discovery in Proceedings to Enforce Loan Facilities / Notice of Motion/application for Further Discovery of Documents Relating to the Funds Allegation

Legal Issues

  1. 1 ["Whether documents relating to Bankwest's alleged shortage of funds or HBOS's shortage of funds were relevant to a fact in issue in the proceedings." 'Whether the alleged unwillingness or inability of Bankwest to advance funds to commercial borrowers was a real issue in dispute.' 'Whether the requested discovery was necessary or sufficiently useful having regard to the overriding purpose, proportionality, cost and oppression.' 'Whether the categories sought amounted to an impermissible fishing expedition.']

Ratio Decidendi

The funds allegation could not be dismissed as other than a real issue, and Daleport was not merely fishing because the pleaded issue concerned Bankwest's state of mind and potentially relevant documents would be in the Bank's possession. However, broad audit-type discovery into Bankwest's financial position was not sufficiently necessary and was too broad and oppressive. A confined category of board papers, minutes, CEO and Chairman's notes, and related reporting documents concerning capital adequacy, the sale of Bankwest, funding and liquidity was proportionate and sufficiently connected to the pleaded issue to warrant discovery.

Court Disposition

Further discovery ordered in part.

Orders

  • ["The plaintiff is ordered to provide discovery of the documents specified in items 7, 9, 10, 11, 31-37, 39, 43-48, 54 and 60 in Mr Auty's report." 'The parties are directed to bring in short minutes within 3 days addressing future steps in the proceedings.']