Case: Springfield Nominees Pty Ltd v Bridgelands Securities Ltd (1992) 38 FCR 217
Outcome: applied
Lee Outline was served in separate proceedings between Telstra and the Australian Telecommunications Authority ('AUSTEL') (in which proceedings, Optus was also a party) (the 'IDD proceedings') on 5 February 1996 pursuant to an order of the Court in the IDD proceedings made on 19 December 1995 (see orders at pp 1 2 of Exhibit PAH-3 in Ex. A). Telstra submits and Optus accepts that a witness statement such as the Lee Outline, brought into existence for the purpose of one set of Court proceedings, is subject to an implied undertaking which precludes its use in other proceedings absent the consent of the party concerned or the leave of the Court: see Springfield Nominees Pty Ltd v Bridgelands Securities Ltd (1992) 38 FCR 217 at 223 per Wilcox J. Optus says that it was for this reason that it originally sought leave in the 1995 proceedings to use the Lee Outline for other purposes. Optus was granted leave to use the Lee Outline by order of the Court on 26 July 1996. The leave granted by Lockhart J on 26 July 1996 was, relevantly, in the following terms: '1. Subject to 3 and 4 below, the Court grants leave for the use of paragraphs 86-93 and 166-77 of, and attachments "SL8-C and "SL26-C" to, the Outline of Evidence of Stuart Alan Newton Lee dated 5 February 1996 and served by the Applicant in these proceedings ("the Lee Outline") on behalf of [Optus Networks Pty Ltd] in: (i) proposed proceedings in the Supreme Court of New South Wales substantially in the form of Annexure "A" to the Notice of Motion dated 27 June 1996 ("the proposed proceedings"); and/or (ii) a mediation or other dispute resolution procedure with respect to the subject matter of the proposed proceedings, on the basis that such consent is without prejudice to the Applicant's rights to object to, and/or seek a stay of, the proposed proceedings or any such mediation or other dispute resolution procedure. 2. Subject to 3 and 4 below, the Court grants leave for the use of those parts of the Lee Outline referred to in 1 above on behalf of [Optus Networks Pty Ltd] for the purposes of and in accordance with the dispute resolution procedures set out in the Access Agreement dated 14 August 1992.' A complete copy of the orders made by Lockhart J is at pp 166 167 of Exhibit BEH-2 in Ex. 2. Paragraphs 3 and 4 dealt with confidentiality issues and are not directly relevant for present purposes. Optus submits that the use of the Lee Outline in these proceedings on the basis set out in the TCASC is within the scope of the leave granted by Lockhart J, in that it is 'for the purpose of and in accordance with the dispute resolution procedures set out in the Access Agreement dated 14 August 1992'. Telstra disputes this. Telstra submits that the grant of leave to Optus was for a specific purpose which has been spent. The leave granted was limited not at large and Optus is no longer entitled to rely on his Honour's orders again to use the Lee Outline in the current proceedings. A copy of the Access Agreement is annexure C in Ex. 3. The dispute resolution procedures are set out in cl 19 and Schedule 7 of the Access Agreement. In essence, these provisions establish a procedure whereby the parties are to endeavour to resolve disputes in the first instance by discussion or negotiation and, failing this, by reference to an Expert Committee. However, the procedures do not exclude, and indeed expressly contemplate, a party having recourse to court proceedings if a dispute is not resolved by other means: see, in particular, pars 7.5.2 and 7.5.3 of Schedule 7 (see also cl 19.3 and par 7.2.5 of Schedule 7, which contemplate resolution of a dispute 'by whatever means'). It is common ground that Optus initiated the dispute resolution procedures set out in the Access Agreement in late 1996 and early 1997 and indicated that it would be relying primarily on the Lee Outline for this purpose. Optus submits that the terms of the notification of that dispute were commensurate with the scope of the proposed TCASC: the dispute related, in broad terms, to the alleged unauthorised use by Telstra for marketing and similar purposes, in breach of the Access Agreement, of Optus' confidential information obtained by Telstra in the course of the provision of services to Optus pursuant to the Access Agreement: see, in particular, Optus' letter at pp 16 17 of Exhibit PAH-3 in Ex. A. Pursuant to the dispute resolution procedures, initial discussions were held between the parties which failed to resolve the dispute. Optus notified an intention to refer the matter to an Expert Committee for resolution in accordance with the dispute resolution procedures. These proceedings were then commenced by Optus, seeking, inter alia , urgent interlocutory relief from the Court a step expressly permitted under the procedures set out in the Access Agreement: see cl 19.1 and par 7.5.4 of Schedule 7. The application for interlocutory relief ultimately did not proceed, and the matter was subsequently referred for determination by the Expert Committee in accordance with the dispute resolution procedures. Optus submits that the history of the matter as already outlined demonstrates why leave to use the Lee Outline should be granted, consistent with the principles set out in Springfield Nominees 38 FCR at 223 225 and other cases. The key provisions of the Lee Outline are extracted or referred to in the particulars to the TCASC. It constitutes relevant material, sourced from Telstra, which disclosed a prima facie unauthorised use of Optus' confidential information obtained by Telstra in the provision of services to Optus pursuant to the Access Agreement, in respect of which Optus seeks relief in this Court. Optus submits that the use proposed to be made of the Lee Outline is plainly within the intended purpose of the orders that were made on 26 July 1996. The TCASC sets out the very kind of claim that was pursued by Optus pursuant to the dispute resolution procedures referred to in par 2 of the orders and articulated by Optus in the draft summons for the proposed proceedings in the Supreme Court of New South Wales referred to in par 1 of the orders. Optus submits that Telstra should not be permitted to avoid Optus' use of the Lee Outline in these proceedings by reliance on a technicality. Optus submits that there is a further reason for rejecting Telstra's opposition to par 1 of the notice of motion based on the Lee Outline. Although the Lee Outline is referred to in the particulars to the TCASC, it does not constitute part of the pleading itself and nor does it constitute the whole of the material relied upon to support the pleading. As such, even if Optus were not entitled to rely upon the Lee Outline, references to the Lee Outline could be excised from the TCASC and the TCASC could be filed in that form essentially unchanged along with the SFAA in its existing form. Telstra, in its oral submissions, submits that this latter material indicates that there are no 'special circumstances' of the kind referred to in Springfield Nominees to warrant a grant of leave to rely on the Lee Outline. I have come to the firm view that court proceedings, whether they be interlocutory or not, are outside the dispute resolution procedures which are to apply to disputes arising under the Access Agreement. I think this follows from a reading of Schedule 7 to the Access Agreement as a whole, and in that context, cll 7.1.1, 7.5.2, 7.5.3 and 7.5.4 in particular. It follows, from this view, that the use of the Lee Outline in the current proceedings is not within the terms of the leave granted by Lockhart J on 26 July 1996, in particular the leave granted by par 2 of the orders his Honour made that day. Such proceedings are not part of the dispute resolution procedures set out in the Access Agreement. This conclusion is fortified by the very existence of par 1 of his Honour's orders and its reference to the proposed proceedings in the Supreme Court of New South Wales. Paragraph 1 would not have been necessary if such proposed proceedings were embraced by the leave granted in par 2. On the other hand, I have come to the view that 'special circumstances' exist to warrant leave being granted to Optus to use the Lee Outline in the current proceedings, or at least those parts of it referred to in the amended notice of motion. In Springfield Nominees 38 FCR at 223, Wilcox J referred, with approval, to what was said by Burchett J in Holpitt Pty Ltd v Varimu Pty Ltd (1991) 29 FCR 576 at 578 579 of the need for 'special circumstances' if leave was to be granted see too Crest Homes Plc v Marks (1987) 1 AC 829 at 860 per Lord Oliver and as to what that required. Burchett J said: 'As far as the expression "special circumstances" is concerned, it is an expression which is liable to be misunderstood unless care is taken to ask and answer the question, special in relation to what? "Special" is one of those words which derive almost all their meaning from the context ... If all that is required is that, among the great number of cases in the court in which documents have been discovered, this one must evince some special feature which affords a reason for releasing or modifying the undertaking, there will be no difficulty. Circumstances in which there is a legitimate reason why documents discovered in one proceeding should be made available in another will, viewed in this way, be rare. In the ordinary course, the ordinary rule should apply, there being no special circumstance to suggest otherwise. Cf Jess v Scott (1986) 12 FCR 187, where the Full Court was concerned with the construction of O 52, r 15(2), by which leave to file an appeal out of time could be granted "for special reasons". The joint judgment described (at 195) the expression "special reasons" in this rule as: "an expression describing a flexible discretionary power, but one requiring a case to be made upon grounds sufficient to justify a departure, in the particular circumstances, from the ordinary rule prescribing a period within which an appeal must be filed and served." Of course, if Lord Oliver should be taken to have required the circumstances to be special, not in relation to all the various circumstances of the actions in which the relevant implied obligation has arisen, but in relation to the very small number of cases in which a reason appears why the undertaking might be relaxed, the discretion of the court would be entangled in a rule of quite uncertain import. I do not know on what footing one would say that a particular circumstance among these relatively rare circumstances would be 'special' and another not. I do not think his Lordship intended to fetter the court's discretion in this way. I think he was using the words "special circumstances" to express the same idea which is expressed in the rule discussed in Jess v Scott by the words "for special reasons" ...' In Springfield Nominees 38 FCR at 224, Wilcox J observed that a similar approach was followed by Lockhart J in Sweetman v Australian Thoroughbred Finance Pty Ltd (unreported, Federal Court, Lockhart J, 23 July 1992), and at 225 concluded: 'For "special circumstances" to exist it is enough that there is a special feature of the case which affords a reason for modifying or releasing the undertaking and is not usually present. The matter then becomes one of the proper exercise of the court's discretion, many factors being relevant. It is neither possible nor desirable to propound an exhaustive list of those factors. But plainly they include the nature of the document, the circumstances under which it came into existence, the attitude of the author of the document and any prejudice the author may sustain, whether the document pre-existed litigation or was created for that purpose and therefore expected to enter the public domain, the nature of the information in the document (in particular whether it contains personal data or commercially sensitive information), the circumstances in which the document came into the hands of the applicant for leave and, perhaps most important of all, the likely contribution of the document to achieving justice in the second proceeding.' The 'special circumstances' in the present case are: (1) That leave had already been granted to Optus to use those parts of the Lee Outline referred to in par 2 of the amended notice of motion in the proposed New South Wales Supreme Court proceedings (par 1 of the orders made on 26 July 1996). (2) The claims in the current proceedings bear, in a number of respects, a remarkable similarity to the claims in the proposed New South Wales Supreme Court proceedings. For example, the declarations claimed in pars 1 and 2 of the SFAA: '1. A declaration that information obtained by Telstra from recording the quantity, source, destination, duration, time of occurrence or kind of telecommunications traffic which is generated by customers of Optus Networks and which passes through any of Telstra's telecommunications networks (the Confidential Information ) is information which is confidential to Optus Networks. 2. A declaration that the use by Telstra of the Confidential Information for the unauthorised purposes as defined in paragraph 15 of the Third Consolidated Amended Statement of Claim is: (a) is [sic] in breach of the Access Agreement; (b) in breach of the duty of confidentiality owed by Telstra to Optus Networks; and (c) unconscionable conduct within the meaning of section 51AA of the Trade Practices Act 1974 (Cth).' when read in conjunction with [15] and [16] of the TCASC, are, save for the s 51AA TPA unconscionable conduct aspect, substantially identical to the declarations claimed in pars 1 and 2 of the Summons in the proposed New South Wales Supreme Court proceedings '1. A declaration that information obtained by the Defendant (Telstra) from measuring the quantity, source, destination, duration or kind of telecommunications traffic which is generated by customers of Optus and which passes through any of Telstra's telecommunications networks ( the confidential information ), is information which is confidential to Optus. 2. A declaration that the use by Telstra of the confidential information for marketing purposes or for any purpose not authorised under the Access Agreement between Optus and Telstra dated 14 August 1992, as amended, ( the Access Agreement ) or not otherwise specifically authorised by Optus ( the unauthorised purposes), is in breach of: (a) the Access Agreement; and (b) the duty of confidentiality owed by Telstra to Optus.' (3) The document (the Lee Outline) did not come into the hands of Optus through the exercise of any process which mandated its production. Indeed, the document was brought into existence only as part of the dispute resolution process, not anterior to it. (4) While it is not possible at this stage to say whether the document will be important to the achievement of justice in the case, it has at least the potential to be important to the proper determination of the case: Springfield Nominees 38 FCR at 225. The factual background to Telstra's opposition to the motion on the second basis outlined in [6](2) supra would not seem to be in dispute although there are clearly differences between the parties as to the implications of some of those facts. In Optus' original Application filed 17 December 1997, there was a claim at [11] for damages pursuant to s 82 of the TPA. Telstra says these were included for the purposes of Optus' claim for damages in respect of an alleged contravention of ss 51A , 52 and 53 of the TPA, presumably by reference to the pleadings at [24] and [29] of the original Statement of Claim filed the same date. On the other hand, Optus says the claim for damages in [11] of the Application is general and not limited to any particular contravention, following claims for declaratory, injunctive and delivery up relief in connection with the confidential information case.