United Crib Blocks Construction Pty Ltd v Asmaro

By a Notice of Motion filed on 29 November 2024, the first and second defendants and applicants on the Motion, Mr Asmaro and Australian Retaining Technologies Pty Ltd (together, the Applicants) have sought to set aside, pursuant to r 34.2(1) of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR), the bulk of a Notice to Produce served on them by the plaintiff (the Respondent) on 15 October 2024 (the NTP).

Rule 34.2(1) provides that party must produce a document or thing in accordance with the notice to produce, “[u]nless the court orders otherwise”.

The substantive proceedings were commenced by Statement of Claim (SOC) filed on 20 May 2024. The Amended Defence (AD) was filed on 13 September 2024. For the purposes of this section only, I will refer to the Respondent as the plaintiff and the Applicants as the defendants, reflecting their roles in the substantive proceedings. The first defendant is a former employee of the Respondent, and a director of the second defendant.

In its SOC, the plaintiff seeks an order restraining each of the first and second defendants, and the servants or agents of the second defendant, from using confidential information of the plaintiff indefinitely or, in the alternative, for such period as determined by the Court (prayer 1). Prayer 18 also contains a materially similar order restraining the first defendant, second defendant, and any employee, officer or agent of the second defendant from using or continuing to use the confidential information of the plaintiff. The SOC also seeks:

In broad terms, the SOC alleges the first defendant misused confidential information or breached duties owed in relation to that information that he obtained while he was an employee of the plaintiff, namely by giving that information to the second defendant (a corporate entity which the first defendant set up). The SOC also pleads that the first defendant and/or the second defendant solicited two clients of the plaintiff, Mainbrace Constructions (Mainbrace) and Burton Contractors Pty Ltd (Burton Contractors).

Notwithstanding the proceedings having commenced on 20 May 2024, and the pleadings being closed by 13 September 2024, to date no order has been made for the service of evidence in the proceedings. The progression of the proceedings appears to be otherwise stalled until the determination of this interlocutory application. Correspondence and associated documents before the Court explain the circumstances in which this has occurred and provide the procedural context to the current Motion.

On 18 September 2024 at 3:47pm, the solicitor for the Applicants sent an email to the solicitor for the Respondent, noting the matter had been activated for the Online Court and suggesting the matter proceed by the Respondents filing a reply to the Defence (as had been previously raised by the Respondent), followed by the Respondent filing and serving its evidence in chief, and the Applicants then filing and serving their evidence in reply.

On the same day at 4:19pm, the Respondent’s solicitor sent an email to the Applicants’ solicitor stating his client wished to file an application to seek leave to issue subpoenas and for orders for disclosure to be made before a timetable for the service of evidence was entered into. It was explained that this “is having regard to the nature of the allegations our client has pleaded and in circumstances where our client is not privy to communications between the Defendants and the third parties named in the Statement of Claim, among other parties”. Orders were proposed by the Respondent which included an order to file a Notice of Motion seeking that leave, returnable before the Court on 15 October 2024.

On 19 September 2024 at 10:30am, the Respondent’s solicitor submitted a request to the Online Court, seeking the following orders:

At the time of making this request, the Respondent provided the Online Court with the following reasons for submitting the request:

On 20 September 2024 at 12:10 pm, the parties were sent an email from the Online Court as to the orders that had been made by the Registrar (Exhibit E), listing the matter for Directions before the Registrar on 15 October 2024, and which also provided the following commentary:

On 15 October 2024, the Respondent filed the NTP that is the subject of this Motion. In summary, the NTP sought:

The NTP comprises 48 paragraphs of requests, of which the first 6 paragraphs relate to Mainbrace and Burton Contractors (as described by subparagraphs (1)-(3) of my summary above). The 21 other companies in relation to which documents are sought, by way of the requests in paragraphs 7-48 of the NTP, are derived from a specified list of clients prepared by the first applicant when he was employed by the Respondent.

The 42 other paragraphs of the NTP which seek from the Applicants correspondence, invoices and receipts concerning 21 other companies are similar in form. For each of the 21 other companies named in the NTP, there are two separate paragraphs seeking the information described at [12(4)] above.

Not all paragraphs of the NTP were ultimately pressed. Specifically, paragraphs 13-14, 25-26, 27-28, 35-36 and 37-38 were no longer pressed by the Respondent. Each pair of paragraphs related to a particular company. Those portions of the NTP which were still pressed concerned 16 companies. This judgment is only concerned with those paragraphs of the NTP that are still pressed.

This procedural context appears to provide some explanation as to why the current Motion before the Court has been filed by the Applicants seeking orders for the NTP to be set aside, rather than a motion filed by the Respondents making an application for an order for disclosure, having addressed the issues set out at paragraph [6] of Practice Note SC Eq 11 (the Practice Note).

On the issue of the above “commentary”, the Applicants made the following submission (in their written submissions in reply, at [6]): “… the Acting Registrar’s commentary is not admissible as a gloss on the operation of the Practice Note, nor as an authoritative statement of principle. For that reason, Exhibit E is of very limited utility”. I accept this submission and note the core utility of the commentary as providing procedural context to these proceedings.

On about 8 November 2024, the Applicants’ solicitor sent a letter to the Respondent’s solicitor in relation to the NTP, which raised a number of issues which included:

On 18 November 2024, the Respondent’s solicitor sent a letter to the Applicants’ solicitor in response to the 8 November 2024 letter, disagreeing with the Applicants and providing their views in relation to the issues, which included the relevance of the Practice Note and associated rules and the issue of legitimate forensic purpose. The Respondent otherwise sought production of the documents.

On 26 November 2024, the Applicants’ solicitor sent a further letter in response, reiterating the Applicants’ views in relation to the application of the Practice Note.

On 29 November 2024, the Applicants filed the Notice of Motion seeking to set aside the NTP, save for the first six paragraphs.

At the hearing of the Motion, Mr Maroya of counsel appeared on behalf of the Applicants and Mr McIntosh of counsel appeared on behalf of the Respondent. Counsel for both sides provided a written outline of submissions prior to the hearing and made oral closing submissions following the reading of evidence at the hearing. Given limitations of time, and without objection from the Respondent, Mr Maroya was permitted to provide written submissions, strictly in reply, by 5:00pm on the day of the hearing.

As required, I will cite the evidence in the proceedings by reference to the Court Book (CB), transcript (TR) pages and exhibit numbers, and cite the submissions by reference to the Applicants’ outline of submissions of Mr Maroya (AOS), the Respondent’s outline of submissions of Mr McIntosh (ROS), and the written submissions in reply of Mr Maroya (AOS-R).

The Applicants read and relied on two affidavits by Mr Asmaro (one of which was described as a “confidential affidavit”), and an affidavit of their solicitor, Mr Bhatty. The Respondent read and relied on two affidavits by its solicitor, Mr Hudspeth (one of which was described as “open” and the other “closed”), and an affidavit of the director of Respondent, Mr Bouhoutsos.

The parties raised with me the fact that the material in some of the affidavits, including the documents exhibited with or annexed to those affidavits were subject to a confidentiality regime between the parties. The Respondent sought, without demur from the Applicant, orders marking four of the affidavits as confidential and restricting access to those affidavits without further order of the Court. I made those orders.

At the commencement of his oral submissions, after my having made the confidentiality orders referred to above, Mr Maroya said (at TR P2 L24-30):

The Respondent carries on a business of providing commercial and residential construction services, including in respect of the supply of construction and certification of retaining walls in New South Wales, Queensland and Victoria.

Mr Asmaro was employed by the Respondent from December 2019 to September 2023. What exactly Mr Asmaro did whilst working with the Respondent is not clearly spelled out in the evidence. However, as part of his role, he was closely involved in the creation and maintenance of an important document, which the parties referred to as the “Job Details” document. It is the contents of this document around which much of the dispute between the parties (both this interlocutory contest and the broader dispute) centres.

At a high level, this document contained, amongst other information:

The existence of the “Job Details” document is not in dispute.

Additionally, it does not appear to be in dispute between the parties that Mr Asmaro was closely involved in the creation and maintenance of the document.

Both Mr Asmaro and Mr Bouhoutsos gave evidence that Mr Asmaro was the one who created the document when Mr Asmaro was employed by the Respondent. Mr Bouhoutsos deposes that Mr Asmaro had “primary control” of the document whilst he was employed, being one of only four employees who had access to the document. He says Mr Asmaro was in charge of monitoring tenders and so maintaining the Job Details document formed part of his job. Mr Asmaro says he “was the only person responsible” for updating the document. He deposes to having updated the Job Details document every now and then, and that he believed he had had a “large hand in drawing up” the document. He also recalls building a formula in Microsoft Excel (the application in which the Job Details document was drawn up) to automatically update parts of the document.

There are two relevant versions of this document, a 2022 version and a 2023 version. The 2022 version was the version of the document drawn on to come up with the list of the businesses in relation to which the NTP seeks documents. However, Mr Bouhoutsos deposes that the 2023 version of the document contains many of the businesses as referenced in the NTP and that the companies named in the NTP (excluding those companies in relation to whom production is no longer pressed) are ones with whom the Respondent continues to have an ongoing relationship of some sort. That is because those companies provided work to the Respondent or because the Respondent still has contact with those companies, either because it submits tenders or because it receives pricing inquiries.

As was earlier mentioned, Mr Asmaro’s employment with the Respondent ended in September 2023. Shortly before Mr Asmaro’s employment ended, he became a director of the second applicant, whose business includes the provision of commercial and residential construction services. In its Amended Defence, the Applicants deny that the second applicant is a “direct competitor” of the Respondent, but Mr Asmaro’s affidavit evidence suggests there may be at least some competition between his company and the Respondent either now or potentially in the future.

The only job won by Mr Asmaro’s company in its first 12 months of operation was for a project in Minchinbury, awarded by Mainbrace. The NTP sought documents in relation to the awarding of this job which the Applicants say they have produced (the Respondent mentioned it may wish to challenge the sufficiency of that production, but the point was taken no further before me).

The Applicants in their evidence question whether the information contained in the Job Details document really is confidential. The Applicants also put on evidence to suggest that he could not practically have taken a copy of the “Job Details” document with him.

It is well established that the grounds to set aside a notice to produce are the same as those which justify the setting aside of a subpoena: Australian Executor Trustees Ltd v Pachkovski [2011] NSWCA 23 at [91] (McColl JA); Pallas v Lendlease Corporation Limited (No 2) [2025] NSWSC 7 at [191] (McGrath J). I will accordingly refer to the authorities on setting aside notices to produce and subpoenas interchangeably.

The legal principles that apply when a Court comes to consider whether to set aside a notice to produce were recently summarised by Meek J in Health Administration Corporation v Toll Global Forwarding Pty Ltd [2024] NSWSC 285 (Health Administration) at [58]-[89]. For convenience, key passages of his Honour’s summary are reproduced below:

As is well known, litigation conducted in the Equity Division of this Court is affected by the Practice Note, titled “Disclosure in the Equity Division”. The material paragraphs of the Practice Note are as follows:

While the Practice Note does not, in terms, apply to notices to produce, the authorities suggest that the Court should be minded to set aside a notice to produce where it is used as a means to obtain disclosure of documents as a subversion of the Practice Note, with some authorities describing such a course as an abuse of process: International Management Group of America Pty Ltd v Media Niugini Ltd (t/as EMTV) (No 2) [2021] NSWSC 919 at [20] (Stevenson J); Re Estates Brooker-Pain and Soulos [2019] NSWSC 671 at [53]-[55] (Lindsay J); The Owners Strata Plan 69567 v Baseline Constructions Pty Ltd [2012] NSWSC 502 at [23]-[28] (Stevenson J); In the matter of Mempoll Pty Limited [2012] NSWSC 1057 at [12]-[13] (Black J) (Mempoll). The same point has been made in the closely related context of applications to set aside subpoenas: Broadway Plaza Investments Pty Ltd v Broadway Plaza Pty Ltd [2019] NSWSC 410 at [55] and [132] (Ward CJ in Eq) (Broadway Plaza); The Owners – Strata Plan No 76902 v Roads and Maritime Services [2017] NSWSC 528 at [20] (Ball J).

Thus, even if a notice to produce may have a legitimate forensic purpose, a notice to produce may yet be set aside on the basis of an attempted subversion of the Practice Note: Broadway Plaza at [132].

As Ward CJ in Eq explained in Marcos Accountants Pty Ltd v Nigtol Pty Ltd [2019] NSWSC 909 at [60]-[61], what flows from the above stated principles is that a subpoena or notice to produce cannot be used as a substitute for an order for discovery which, under the Practice Note, could only be obtained in exceptional circumstances which have been properly identified and explained.

As paragraph 4 of the Practice Note provides, disclosure will only be ordered by the Court if there are “exceptional circumstances necessitating disclosure”.

In Leighton International v Hodges [2012] NSWSC 458 at [19], McDougall J made the following observations as to what “exceptional circumstances” entails in this context (emphasis added):

To show “exceptional circumstances”, it would be necessary to demonstrate the necessity to obtain documents to fairly prepare a case for trial, ie, that the party is unable to serve its evidence without certain documents: Danihel v Manning [2012] NSWSC 556 at [16] (Bergin CJ in Eq).

While it is not possible to list in advance the categories of “exceptional circumstances”, as each case must be judged according to its own facts, one possible set of circumstances which may be exceptional in the sense required is where the relevant facts are not in the knowledge of the party seeking disclosure: Bauen Constructions Pty Limited v New South Wales Land and Housing Corporation [2014] NSWSC 684 at [18] (Ball J); In the matter of Regional Express Holdings Limited (Administrators Appointed) [2025] NSWSC 499 at [8] (Black J).

Owing to the nature of some of the submissions made by the Applicants in relation to the status of the Practice Note, which are dealt with below, I will also set out the statutory context to the Practice Note.

The power of the Chief Justice of this Court to issue practice notes comes from two sources. The first is s 15 of the Civil Procedure Act 2005 (NSW) (CPA), which provides:

Section 16 of the CPA is also relevant. That provision provides:

Second is s 124(11) of the Supreme Court Act 1970 (NSW) (Supreme Court Act). Sub-section (12) is also relevant. Those provisions provide:

In addition to considering the legal principles in relation to setting aside notices to produce, in Health Administration Meek J also referred to the flexibility of the Court’s powers more generally in relation to the production of documents, in a summary which I gratefully adopt:

Having regard to the procedural background set out above, together with the relevant legal principles and submissions made by the parties (see below), the following issues arise for consideration:

In summary, and for the reasons set out below, I have decided to dismiss the application to set aside the NTP.

Both in writing and orally, the Applicants made the submission that “practice notes have the status of statutory rules”, and added in each case that practice notes should not be regarded as “mere or hollow” statements of internal or administrative policies of the Court (AOS-R at [18], TR 16 at lines 43-44).

The Applicants submitted that this conclusion was because of CPA s 15(2)-(3) and Supreme Court Act s 124(11)-(12).

The Respondent made no submissions on this point.

The Applicants’ submission that practice notes have the status of statutory rules must be rejected.

The provisions referred to by the Applicants, ss 15(2)-(3) of the CPA and s 124(11)-(12) of the Supreme Court Act, are in different terms but materially similar in effect. Those provisions require practice notes issued by the Court to be published in the Gazette and say that ss 40 and 41 of the Interpretation Act 1987 (NSW) (Interpretation Act) “apply to a practice note in the same way as they apply to a statutory rule.”

Sections 40 and 41 of the Interpretation Act respectively provide for a requirement that written notice of the making of a statutory rule be placed before each House of Parliament and for the ability of either House of Parliament to pass a resolution disallowing a statutory rule. There is further detail to those provisions but it is immaterial for present purposes.

Plainly, the provisions cited by the Applicants in support of this submission require practice notes to be published in the Gazette and put before the Parliament in the same way other statutory rules are. There is, however, nothing in those provisions which elevates practice notes to having the status of statutory rules.

No further submissions were made justifying why practice notes should be treated as having the same status as statutory rules.

For completeness, I note that while the Interpretation Act does bring a rule of court within the definition of “statutory rule” (see Sch 4 of the Interpretation Act), in both the CPA and the Supreme Court Act, a practice note is conceptually distinct from a rule of court. Nothing in those Acts says a practice note is a rule of court, and it has been said that practice notes will give way to rules of court where the two are in conflict: see Welzel v Francis (2010) 77 NSWLR 92; [2010] NSWSC 75 at [12] (Einstein J).

For those reasons, the Applicants’ submission that the Practice Note has the same status as a statutory rule should be rejected.

However, my conclusion that practice notes, including the Practice Note, do not have the status of statutory rules does not reduce practice notes to “mere or hollow” statements of this Court’s procedure. As Bergin J said in Baulderstone Hornibrook Pty Limited v HBO+DC Pty Limited [2001] NSWSC 821 at [14]:

Certainly, the Practice Note itself has not been treated as a “mere or hollow” statement of practice and procedure. So much is evident from the application of the principles underlying the Practice Note into areas in which they strictly do not apply, namely, to subpoenas and notices to produce. The statement by Ward CJ in Eq in Broadway Plaza at [133] that “non-compliance with the Practice Note should not be condoned” serves to reinforce the importance of the Practice Note to civil proceedings in the Equity Division.

The Applicants’ submissions focused closely on the Practice Note. Their submissions took the following course:

In its written submissions, the Respondent did not initially engage directly with the Applicants’ contentions regarding the application of the Practice Note. At [38] of the ROS, the Respondent submitted that the Applicants “have not established that the call in the NTP is an application for disclosure to which Practice Note SC Eq 11 applies”.

The Respondent also submitted that the Court “would also not conclude that the NTP is, in any way, an attempt to subvert Practice Note SC Eq 11” (ROS [38]). That is so because the NTP “is simply a call for the contact that the [Applicants] have had with a specific list of the [Respondent]’s clients sourced from a highly confidential document developed by the [first applicant] during his employment with the [Respondent].”

In its oral submissions, the Respondent submitted that if the Practice Note applied, then “exceptional circumstances” as understood for the purposes of the Practice Note were present here. It submitted that the information sought by the NTP was “information that’s solely within the knowledge of the [Applicants]” (TR P22 L1-2).

The tenor of the Respondent’s written and oral submissions on this issue is summarised below:

I note here that the Respondent did not explicitly link the submissions made above to paragraphs 4 and 5 of the Practice Note, save for the reference at the start of its oral submissions. However, given the Respondent orally referred to the knowledge asymmetry between the parties as showing “exceptional circumstances”, it is convenient to address these submissions here.

To repeat what I said in [40] above, while the Practice Note does not, in terms, apply to notices to produce, nonetheless a notice to produce may be set aside where it is used as a means to obtain disclosure of documents and subvert the Practice Note. To the extent the Respondent’s submissions suggested otherwise, those should be rejected.

However, I am not satisfied that the NTP constitutes an attempt to subvert the Practice Note.

The NTP does not seek the disclosure of documents in overly wide and general terms. The disputed portion of the NTP seeks the production of documents in relation to 16 companies. However, in relation to each company, the NTP seeks only the correspondence passing between either of the Applicants and a specified company from 1 March 2023 to 15 October 2024, and invoices or receipts issued by one or other of the Applicants to a specified company from 1 August 2023 to 15 October 2024. The request for documents is confined, and no complaint is made by the Applicants about the paragraphs of the NTP being vague, oppressive or otherwise unanswerable.

I also do not view the NTP as engaging in a “fishing exercise” in the sense that the documents sought were not apparently relevant to the proceedings. The documents do appear to be apparently relevant to these proceedings. The SOC pleads at [28]-[32] that the first defendant (ie, the first applicant) used the Respondent’s confidential information for the second defendant’s (ie, the second applicant’s) benefit even prior to his departure from the Respondent. It also pleads at [40] that the first defendant has attempted to solicit clients of the Respondent for the benefit of the second defendant. The Applicants have denied both allegations.

I acknowledge that, save for the allegations concerning Mainbrace and Burton Contractors, the misuse of confidential information is not particularised in relation to other specifically named clients. But clearly, a key element of the dispute between the parties will concern whether information alleged to be confidential was misused by the Applicants. Additionally, as the Respondent pointed out, the list of 16 companies in relation to which documents are sought have not come from nowhere. They come from a version of the “Job Details” document referred to earlier in these reasons. That document is expressly referred to in the pleadings as part of the (allegedly) confidential information received and (allegedly) misused by the Applicants.

I do not need to enter the debates had as to whether the information contained in the documents is in fact confidential, or as to whether the "Job Details” document that was in evidence for the purposes of this Motion is the most relevant version of that document. It suffices to say that the documents and communications sought by the NTP as part of this matter are likely to go directly to matters in issue.

Against the possibility I am wrong in my conclusion that the NTP is not attempting to subvert the Practice Note, I will consider whether the NTP might otherwise still not run afoul of the Practice Note because “exceptional circumstances necessitating disclosure” have been shown. For the reasons which follow, I am still satisfied that “exceptional circumstances” have been made out. In my opinion, the documents sought by the NTP are otherwise necessary for the fair disposal of the matter and in the interests of a fair trial.

The Respondent submitted that, to the extent its case that the Applicants are misusing its confidential information is made out, it does not know the extent of the misuse. What seems to follow from this submission is that what is sought by the NTP is necessary to properly assess the scope of its case, both as to the quantum of damages that might flow to it, but also in making good its pleaded case that the Applicants did misuse confidential information.

Whether the Respondent’s allegations as to misuse of confidential information will eventually be made good at any eventual trial is one matter. Furthermore, as I explain later in these reasons (see [90] below), I do not accept the Respondent’s submission that the information sought from the Applicants by the NTP is strictly within only the Applicants’ knowledge. However, I accept on the material before me that, notwithstanding it was able to put a case in respect of Burton Contractors and Mainbrace, the Respondent is not in possession of information that would allow it to assess in full and make good its case as to misuse of confidential information.

Necessarily, the Respondent would not be in possession of the communications or invoices that passed between the Applicants and others. The NTP enables the Respondent to have more information concerning the extent to which, on its case, its confidential information was misused, and the information being sought is information which is largely in the knowledge of the Applicants. These considerations seem to provide the necessary exceptional circumstances (see [46] above, see also Mempoll at [21] (Black J)).

The Respondent’s submissions focused especially on this issue. It submitted that the just, quick, and cheap resolution of the real issues in the proceedings would be facilitated by requiring compliance with the NTP because the full extent and effect of Applicants’ conduct, particularly the first defendant’s alleged breaches of duties, will not otherwise be known.

The Respondents also submitted that there would be a “risk of further and unnecessary delay in the proceedings” (ROS [33]) if the NTP were set aside, as denying the Respondent access to the information sought within the NTP “would unnecessarily obscure the extent of the [Respondent’s] case.” In oral submissions, the Respondent added to this contention by submitting that learning of the full extent of any breaches of duty by the Applicants, which it says is only possibly by the Applicants complying with the NTP, after the close of evidence would add unnecessary costs to the proceedings. This is so because there would then need to be further amendments to the pleadings and further evidence put on.

The Applicants’ submissions did not directly contend with this more general question. Their submissions, as I understood them, started from the premise that the purpose of the Practice Note is to facilitate the just, quick and cheap resolution of the issues in dispute in proceedings in the Equity Division. From that starting premise, it followed that attempts to seek disclosure from the Applicants in a manner which subverted the Practice Note are themselves not actions which facilitate the just, quick and cheap resolution of proceedings.

More specifically, at AOS [17], the Applicants submitted that in circumstances where the Respondent’s specific claim for damages or compensation is of a “modest sum” ($192,928.16), the likely costs of compliance with the NTP are not justifiable in comparison. In response to this specific contention, the Respondents submitted orally that the Applicants have not pointed to any reason complying with the NTP would be onerous in some regard.

In my opinion, compliance with the NTP would facilitate the just, quick and cheap resolution of the proceedings in this case.

There has been no progress regarding the service of evidence in these proceedings to date.

I approach this question keeping in mind that, as I decided above, the NTP seeks from the Applicants material of a fairly defined nature which is at least apparently relevant in the proceedings.

While it is not strictly correct to say, as the Respondent submitted, that what is sought by the NTP is only within the Applicants’ knowledge (for reasons I explain below), there is much force in the Respondent’s contentions that as things stand, it would be an inefficient course to now delay the provision of the documents sought by the Respondent.

The NTP seeks documents recording communications between the Applicants and other parties, and invoices or receipts issued by the Applicants to other parties. Necessarily then, the other parties to the communications or recipients of the invoices or receipts, that is, the 16 companies named in the still-pressed parts of the NTP, would also possess knowledge of those communications and documents. In fairness, the Respondent’s written submissions seemed to acknowledge this when, at ROS [42], it argued that it “would not be appropriate to issue a multitude of subpoenas to the [Respondent’s] clients at this time”.

Why it would not be appropriate to issue subpoenas at this time is not explained by the Respondent. However, in its written response to this submission, at AOS-R [31], the Applicants contend the reason the subpoenas would be inappropriate are because the Practice Note applies. It does not contend later subpoenas would, for example, be liable to be set aside. Further, at AOS-R [32], the Applicants say the Respondent’s director could have instead asked a responsible person within each of the 16 companies to assess if, in fact, the Applicants have done what the Respondent alleges they have done. These arguments by the Applicants suggest, even if indirectly, that what is being sought by the NTP will likely be relevant to the case.

To my mind, the question then is not necessarily whether the documents sought in the NTP could ever be requested. It should be clear that, in my view, the requests are proper. The question is when those requests could be made.

I accept the Respondent’s submissions that setting aside the NTP now would bring about delay and further costs. Whether the pleadings would need to be amended to take into account anything found in the documents sought by the NTP is not a question I need to decide. But it should be accepted that any documents which uncovered evidence of potential breaches of duty or contract could be part of the Respondent’s evidence in this case, at the very least in so far as the quantum of any compensation is concerned. Accepting that point means that delaying the provision of these documents to after the service of evidence is likely to add costs and delay the proceedings, at least to the extent the Respondent would then need to put on further evidence and the Applicants need to put on further evidence in reply. Having the NTP complied with now is more likely to lead to the efficient preparation and service of evidence – it is more likely it can be done all at once. If the pleadings do need to be amended, all the more reason in this case to have those finalised earlier rather than later.

While I acknowledge the Applicants made a submission that the likely costs of compliance with the NTP were not proportionate to the size of the dispute, the submission rose no higher than a bare assertion to that effect. There was no submission that compliance with the NTP would be unduly difficult.

Ultimately, my view is that not setting aside the NTP is more likely to promote the efficient progression of these proceedings, something which is sorely needed given its progress has stalled.

I note also that what I have said at [93] also provides, to the extent it was relevant, a further basis in the context of these proceedings to conclude, that “exceptional circumstances” for the purposes of the Practice Note have been made out in this case (applying what was said by Black J in Mempoll at [21], and by Kunc J in Simson v Wotif.com Holdings Limited [2013] NSWSC 1809 at [25]).

In conclusion, the NTP should not be set aside and the Applicants’ Notice of Motion should be dismissed.

The usual order as to the costs of an interlocutory application is that the costs of the application be costs in the cause: UCPR r 42.7(1), Wilson v Gillies (No 2) [2020] NSWSC 658 at [11] (Rees J); Wang v Cai (No 2) [2021] NSWSC 1268 at [61] (Ward CJ in Eq); Skytraders Pty Ltd v Meyer [2023] NSWSC 857 at [2] (Richmond J).

Both parties sought their costs of the Motion if they were successful.

Rule 42.7(1) does not fetter the Court’s usual discretion as to costs: His Eminence Metropolitan Petar, Diocesan Bishop of the Macedonian Orthodox Church of Australia and New Zealand v The Macedonian Orthodox Community Church St Petka Inc (No 2) [2007] NSWCA 142 at [28] (Beazley, Giles, and Hodgson JJA). However, no argument was addressed by either side as to why I should depart from the default position as to costs in interlocutory proceedings and exercise my discretion as to costs in a given party’s favour. I also do not see anything in the circumstances of this case that would obviously warrant a departure from that position. Consequently, I will simply order that costs will be costs in the cause.

For the above reasons, I make the following orders: