summary Hearne v Street [2008] HCA 36
In 2004, Luna Park located on the north side of Sydney Harbour, just west of the Sydney Harbour Bridge, was reopened.
Some local residents commenced proceedings the following year complaining about noise pollution from music, loud speaker announcements, mechanical noise, and visitors shrieking, alleging that Luna Park Sydney Pty Ltd had been and was committing the tort of nuisance against them.
On 18 April 2005, the Daily Telegraph published an article under the headline: “The NUMBY* files”. The asterisk directed attention to the statement “*NUMBY: Not Under My Balcony. The city cousin of the NIMBY (Not in My Backyard)”.
The article then said: “Well-heeled residents battling Luna Park have made some quirky, if not bizarre, claims”, below which appeared the following words:
“DISRUPTED violin lessons, entrapped Chinese herbal medicine fumes and smoking daughters have been cited by residents as reasons why Luna Park should shut down rides.
The Daily Telegraph has seen several affidavits filed in the Supreme Court by Milsons Point residents against the amusement park, which re-opened in April last year.
Here is a summary of some of the residents’ affidavits, which make interesting reading.
The court is likely to decide in July whether to grant the residents’ injunction order to close down five rides.
Luna Park says this order, if granted, could cause it major financial pain.”
The article, as the primary judge Gzell J noted, commented “in fairly disparaging terms, to allegations made by local residents about the noise from Luna Park and how it interfered with their lives.”
The article was based of affidavits filed in the proceedings provided to the Daily Telegraph (and which were also emailed to the office of the Minister for Tourism, Sport and Recreation) by Peter Hearne, the managing director of Luna Park Sydney Pty Ltd and David Tierney, a director of its ultimate holding company, Multiplex Ltd within less than two weeks of the proceedings being commenced.
Following publication of the Daily Telegraph article, the solicitors for the residents complained in 19 April 2005 that Luna Park Sydney Pty Ltd had released affidavits filed on behalf of the residents to the Daily Telegraph. That letter requested an undertaking not to release any unread affidavits to the media or any other person not properly connected to the proceedings. On 20 April 2005, the solicitors for Luna Park Sydney Pty Ltd replied with an unreserved apology from Luna Park Sydney Pty Ltd for releasing affidavits to the media. That letter also provided the undertaking sought, which extended to directors of Luna Park Sydney Pty Ltd acting in that capacity.
Subsequently, a “noise impact assessment report” dated 26 May 2005 by Dr Renzo Tonin, an acoustic expert filed in the proceedings was disclosed by the residents on 27 May 2005.
Hearne and Tierney had some dealings with the Minister for Tourism, Sport and Recreation and staffers in her office. An email from Hearne to a person in the office of the Minister on 25 July 2005 attached the Daily Telegraph article, part of one of the residents’ affidavits and the report of Dr Tonin. On 13 October 2005, Tierney sent an email with the same attachments to the Minister’s office.
Contempt proceedings were brought by the residents based on breaches of the implied undertaking. However the primary judge dismissed the contempt proceedings because the individuals who had disseminated the affidavit and report had not provided any undertaking to the Court.
On appeal, the result was reversed by a majority of 3 judges (Ipp JA and Basten JA, Handley AJA dissenting), with the individuals who had provided the affidavit and report found guilty of contempt and the sanctions to be imposed remitted for determination.
s 101 of the Supreme Court Act 1970 (NSW) relevantly provides that:
101 Appeal in proceedings before the Court
(1) Subject to this and any other Act and subject to the rules, an appeal shall lie to the Court of Appeal from–
(a) any judgment or order of the Court in a Division, and
(b) without limiting the generality of paragraph
(a)–
(i) any opinion, decision, direction or determination of the Court in a Division on a stated case,
(ii) any exercise of a power to which section 24 applies, and
(iii) any determination of the Court in a Division in proceedings remitted under subsection (4) of section 51.
(5) An appeal lies to the Court of Appeal from any judgment or order of the Court in a Division in any proceedings that relate to contempt (whether civil or criminal) of the Court or of any other court.
(6) Subsection (5) does not confer on any person a right to appeal from a judgment or order of the Court in a Division in any proceedings that relate to criminal contempt, being a judgment or order by which the person charged with contempt is found not to have committed contempt.
In Riddick v Thames Board Mills Ltd [1977] QB 881, Lord Denning MR said:
“Compulsion [to disclose on discovery] is an invasion of a private right to keep one’s documents to oneself. The public interest in privacy and confidence demands that this compulsion should not be pressed further than the course of justice requires. The courts should, therefore, not allow the other party – or anyone else – to use the documents for any ulterior or alien purpose. Otherwise the courts themselves would be doing injustice.”
In Harman v Secretary of State for the Home Department [1983] 1 AC 280 at 300, Lord Diplock said:
“The use of discovery involves an inroad, in the interests of achieving justice, upon the right of the individual to keep his own documents to himself; it is an inroad that calls for safeguards against abuse, and these the English legal system provides … through its rules about abuse of process and contempt of court.”
In Watkins v A J Wright (Electrical) Ltd [1996] 3 All ER 31 at 42, Blackburne J said:
“In my judgment, a serious inroad into [the safeguards referred to by Lord Diplock] and, therefore, into the utility of the discovery process in the just disposal of civil litigation would occur if it were open to a litigant (or his solicitor) to enjoy the fruits of discovery provided by the other side, but avoid the risk of committal for contempt for acting in breach of the countervailing implied obligation on the ground that he was unaware of the existence of the undertaking. I take the view that it does not lie in the mouth of a person to plead ignorance of the legal consequences of the discovery process.”
Turning to Australian authorities, in Esso Australia Resources Ltd v Plowman (1995) 183 CLR 10 at 32-33; [1995] HCA 19, Mason CJ (with whom Dawson and McHugh JJ agreed) said:
“It would be inequitable if a party were compelled by court process to produce private documents for the purposes of the litigation yet be exposed to publication of them for other purposes. No doubt the implied obligation must yield to inconsistent statutory provisions and to the requirements of curial process in other litigation, eg discovery and inspection, but that circumstance is not a reason for denying the existence of the implied obligation.”
The High Court unanimously dismissed the contemnors’ appeal against the decision of the Court of Appeal.
The majority
The nature and scope of the implied undertaking was described by the majority (Hayne, Heydon and Crennan JJ) as follows:
“Where one party to litigation is compelled, either by reason of a rule of court, or by reason of a specific order of the court, or otherwise, to disclose documents or information, the party obtaining the disclosure cannot, without the leave of the court, use it for any purpose other than that for which it was given unless it is received into evidence. The types of material disclosed to which this principle applies include documents inspected after discovery, answers to interrogatories[68], documents produced on subpoena, documents produced for the purposes of taxation of costs, documents produced pursuant to a direction from an arbitrator, documents seized pursuant to an Anton Piller order, witness statements served pursuant to a judicial direction and affidavits. The appellants did not dispute the existence of this principle, and in particular did not dispute its potential application to the affidavit of Mrs Hesse and the witness statement of Dr Tonin…
Of course the consequence of filing and serving affidavits and statements in legal proceedings is that one day their contents might become open to the public when read in open court. But it was not illegitimate to seek to ensure that before that time the defendants, Luna Park Sydney Pty Ltd and Metro Edgley Pty Ltd, and persons acting in their interests, did not abuse their access to the documents in employing them for a purpose outside the proceedings.”
The majority, responding to arguments that the implied undertaking should not apply to non-parties, noted that:
The narrower the avenue of liability against third parties, the weaker the incentive for litigants to give full discovery and to provide all relevant evidence. “The interests of the proper administration of justice require that there should be no disincentive to full and frank discovery”[117] – or to full employment of all of the court’s procedures directed to accurate fact finding in litigation.
The majority rejected an argument challenging the competency of the appeal that all proceedings for contempt “must realistically be seen as criminal in nature”, noting such an argument did not allow for the distinction between criminal and civil contempts, and it ignored the fact that Section 101(6) assumes such a distinction.
They concurred with the majority in the Court of Appeal in finding that the contempt proceedings were civil in nature because the residents had a legitimate interest in and sought to protect their privacy from the breaches of the implied undertaking.
Gleeson CJ
Gleeson CJ agreed with Hayne, Heydon and Crennan JJ that the “implied undertaking” is better understood as a substantive legal obligation which also applies to a servant or agent of a party. Gleeson CJ also observed that there was no difficulty in categorising them as agents of Luna Park Sydney Pty Ltd.
Gleeson CJ also agreed with the majority that the contempt was civil, not criminal and therefore that s 101(6) of the Supreme Court Act 1970 (NSW) did not apply. Gleeson CJ concluded that the appeal should be dismissed with costs.
Kirby J
Kirby J held that because that the residents’ contempt proceedings were remedial or coercive in nature, the better view was the proceedings were to be classified as relating to civil contempt. Therefore, the appeal was competent.
Kirby J shared the concerns which Handley AJA expressed in the NSW Court of Appeal that the providing of materials to the Minister may have attracted the privileges of Parliament.
Kirby J also observed that “it is arguable that there is a need for a fundamental reconceptualisation of the relevant legal categories and the re-expression of the common law in less fictitious and artificial language” of the implied undertaking.
Kirby J also agreed that the appeal should be dismissed with costs.
The majority confirmed that the implied undertaking is binding on third parties such as the contemnors in this case so long as they are aware the documents in question have been obtained through court processes, noting that although it is called an undertaking it is in fact an obligation that arises by law and does not require any kind of implied consent for it to apply. It is not necessary to prove that the third party knew of the implied undertaking: as the majority observed that would be very difficult to prove in most cases. This is also consistent with criminal law where ignorance of the law affords no defence. The law of contempt is quasi-criminal in nature, despite the fact it is categorised as sui generis (“in a class by itself”).
