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Court in the Act
10 August, 2007  
Batties' document merry-go-round

Appeals and stay applications return to court as the tobacco junkies fight every point to keep their gruesome secrets and “iniquities” from sparking a new round of damages claims. Ginger Snatch, judges’ associate, reports

imageNext Wednesday (August 15) the Batty cancer-stick boys are in the Victorian Court of Appeal trying to blow more choking fumes in the faces of Slater & Gordon and the Rolah McCabe estate.

The action is in Melbourne, now that Justice Paul (Rock Oyster) Brereton has cross-vested the tangled web to Yarraville.

Specifically, two matters now are to the fore. An appeal by British American Tobacco Australia Ltd (BATAL) and sister company British American Tobacco Australia Services Ltd (BATAS) against recent findings and orders of Justice David Byrne and an application by Rolah McCabe’s estate to stay BATAS from enforcing the 2002 Victorian Court of Appeal judgment against the estate.

A bill of costs for $2.1 million in taxable form has been served on Mrs McCabe’s daughter, Roxanne Cowell, after it lay dormant for almost five years.

If numerous people are being killed as result of consuming the company’s toxic products, then bankrupting Roxanne doesn’t seem so terrible in the scheme of things.

What does seem terrible is that the tobacco companies will take every point and litigate till hell freezes over before Slater & Gordon or the McCabe estate can reopen the damages and personal injury case on the ground of an “iniquity”.

The iniquity allegedly arises from the destruction of documents which subverted the discovery process, with the intention of denying the plaintiff a fair trial. Justice Geoffrey Eames, who heard the case, struck out the BATAS defence for those very reasons, only to be overturned by the Court of Appeal after enough smoke was puffed in its eyes.

What has reignited the imbroglio was the emergence in The Sunday Age newspaper of some of the findings of an internal, and hitherto secret, Clayton Utz report into the conduct of the McCabe litigation. Two partners of the firm (Glenn Eggleton and Richard Travers) were forced to walk the plank and it is now clear that a third partner, Christopher Dale, was so distressed by what he knew, that he leaked the firm’s findings to Slater & Gordon, who then leaked them to The Sunday Age and The Age.

Nice work, boys. Dale and The Age should be given medals. See Justinian articles passim.

Byrne loosened an interim injunction and undertakings against the McCabe estate and Slater & Gordon, which had prevented them from using confidential and privileged information in defending BATAS and BATAL injunction proceedings and in making application to set aside the December 2002 decision by the Victorian Court of Appeal in BATAS v McCabe.

imageIn the words of Justice (Rock Oyster) Brereton, who clung to the matter well beyond what was sensible after the disclosure that he had provided advice to the company as a barrister (see more below):

“The main issue at the final hearing is likely to be whether there are reasonable grounds for believing that the documents and information in which confidence and privilege are claimed disclose an iniquity.”

If a fraud or wrongdoing can be established, the Batties’ claim of confidentiality on the basis of legal privilege will be defeated.

The tobacco companies are seeking final orders restraining Slater & Gordon, Peter Gordon and McCabe’s family from publishing and disseminating certain information, including the Clutz information about the conduct of the trial.

Since proceedings have been moved to Victoria, Slater & Gordon was granted a modification of the interim restraining order so that the documents could be used in the Victorian court.

The Batties sought to muddy the waters by bringing two separate actions – one by BATAS and another by BATAL.

David Byrne ruled that it would not serve the interests of justice if privileged documents belonging to one of the subsidiaries couldn’t be used by the defendants in proceedings involving the other, merely because there were, on paper, two plaintiffs.

This is one of the matters under appeal on Wednesday.

The Batties argued, in the spirit of Catch 22, that since the Court of Appeal in 2002 had found that privilege existed over the documents, those documents couldn’t be used in any attempt to overturn the judgment which established the privilege in the first place.

imageByrne would have none of it, ruling the only way to cut through the “circle” was to change the interim injunction to allow the information to be used in all the relevant proceedings.

This too is the subject of appeal.

The judge also postponed the issue of whether privilege can be asserted over some of the information. It appears he was in the dark as to what precisely it is the Batties wants so desperately to stop getting out.

“I do not know what this information is other than in the most general terms. Neither of the contending parties have identified it… It seems to me that the appropriate course is for me to reserve to BATAS the right to raise questions of privilege if and when use is sought to be made of information which has as its source the privileged documents. The question as to the existence of privilege may then be debated against the circumstances as they then stand and in the light of the particular piece of information which is in question.”

It seems that somewhere in the weave of Byrne’s judgment was a finding that the confidential Clutz material could also be trotted out by the McCabe estate to try and get the original findings of Justice Eames back on their feet. Again, that is being appealed.

There’ll be a mountain more fees for Corrs (BATAS) and for Baker & McKenzie (BATAL) and the small army of silks at their service before we get anywhere near that state of enlightenment.

* * *

imageYou might remember the instance of the rather self-conscious High Court judge in England, Peter Smith (pic), who inserted a secret code in his Da Vinci Code plagiarism judgment. It said, “Jackie Fisher, who are you? Dreadnought”, and it provided quite a bit of distraction for a while.

Smith himself was the subject of a judgment last month from the Court of Appeal in Howell v Millais.

He had failed to recuse himself from hearing an application in which trustees sought the direction of the court as to the operation of a trust. One of the trustees was a partner of the London firm of Addleshaw Goddard (178 partners and 400 fee earners).

The recusal application arose because Justice Smith had been in negotiations with other partners of Addleshaw Goddard in relation to a business proposal, which would have involved him leaving the bench and joining the firm. Those negotiations ended unhappily, at least for the judge.

After the firm called off further discussions, Smith sent a couple of cranky emails to Simon Twigden of AG:

“I found your first email insulting and your second one condescending. I do not think the response should have been from you by such emails. You really should have had the courtesy to speak to me… I feel you have wasted my time for several months. I am extremely disappointed because contrary to your fine words you have allowed the bean counters to prevail. I am not very impressed with you or your firm at the moment and I do not think the tone of your emails enhances the position.”

Things got even snarlier at the recusal hearing, where Crampin QC appeared for the trustees:

Crampin: Your Lordship is in the process of, while listening to my submission, giving evidence.

Smith: I’m not giving evidence; I’m reminding you of what Mr Twigden said… it is extraordinary to believe, is it not, that Addleshaws are actually fearful on the basis of these emails?

Crampin: I do not think the test is what Addleshaws think …

Smith: Of course it is.

Crampin: ... it is what a fair-minded person can think.

Further on there was this little exchange:

Crampin: I don’t think your Lordship is actually going to pay attention to anything further I say on this subject. Your conduct of the matter in court today is remarkable …

Smith: If you are going to say that, you’d better say it with specificity, or you’d better withdraw it, or there might be professional consequences …

Crampin: It is a remarkable proposition that a judge should cross-examine a witness in the basis of what is in the judge’s head, which no one else has seen…

Smith: I am sorry, Mr Crampin, I’m not going to allow you to pass over a gratuitous comment saying my conduct is remarkable, any more than anybody else would, without requiring you to be specific.

And on it went.

imageThe Court of Appeal said that the judge’s contributions to these exchanges seemed “intemperate” and anyway he should have recused himself.

One of the authorities relied on said that a judicial disqualification was not a discretionary case management decision reached by weighing various relevant factors, such as inconvenience, cost and delay. There was a real possibility of bias or there was not.

The reason to mention all this is that in dealing with the disqualification application, Brereton J let case management issues intrude into his reasons.

According to higher authority, this is wrong-headed.