Navigating and Utilising Preliminary Discovery and Inspection In New South Wales

Written by Katie Vilsbaek

Preliminary discovery and inspection is a useful pre-litigation procedure which allows a party to ascertain a prospective defendant’s identity and obtain documents and/or information to assist in determining whether or not to commence legal proceedings against a prospective defendant. However, it should be used with some caution and you should consult your lawyer before commencing the process.

The process is governed by part 5 of the Uniform Civil Procedure Rules 2005 (UCPR).

Generally, unless the Court orders otherwise, an application for an order for preliminary discovery and inspection must:

1. Be supported by an affidavit stating the facts on which the application relies and specifying the kinds of information, documentation or things in respect of which the order is sought; and
2. Be served personally on the other person (or addressed to the appropriate officer for a company).

Identifying a Prospective Defendant

In the circumstances where you have a cause of action against another person or entity, but cannot establish the identity of the defendant (for example, you know you have an Australian Consumer Law (ACL) case against a service provider under the ACL service provisions, but do not know the identity of the service provider), rule 5.2 (discovery to ascertain prospective defendant’s identity or whereabouts) of the UCPR can be utilised to identify the prospective defendant.

Rule 5.2 applies if the Court is satisfied that:

1. the application, having made reasonable inquiries, is unable to sufficiently ascertain the identity or whereabouts of a prospective defendant, for the purpose of commencing legal proceedings against them; and
2. some person, other than the applicant, may have documents and/or information to assist with the same.

On application by the applicant, the Court may make orders that:

1. the other person attend Court to be examined as to the identity or whereabouts of the prospective defendant; and/or
2. the other person must give discovery to the application of all documents in their possession that relate to the identity of the prospective defendant. 

The application is to be made by notice of motion (where there are already proceedings on foot) or by way of summons.

Discovery of Documents from a Prospective Defendant

In circumstances where you know your prospective defendant, but require further information/documentation to decide whether or not to commence legal proceedings, rule 5.3 (discovery of documents from prospective defendant) of the UCPR can be utilised.

Rule 5.3 applies if it appears to the Court that:

1. the applicant may be entitled to make a claim for relief from the Court against a person, but, having made reasonable inquiries, is unable to obtain sufficient information to decide whether or not to commence proceedings against the prospective defendant;
2. the prospective defendant may have in its control or possession a document or thing that can assist the applicant to determine the same; and
3. inspection of such a document would assist the application to make a decision;

then the Court may order that the prospective defendant must give discovery to the application.

This rule can also be applied to a person who is not a party to proceedings, but may hold relevant documents, under rule 5.4 (discovery of documents from other persons).

Costs

Under rule 5.8 of the UCPR, on any application, the Court may make an order for costs of the applicant, of the person against whom the order is made (or sought), and of any other party, including the costs of listing and producing any documents.

Cautions for Use of an Application for Preliminary Discovery

Has a demand already been sent to the prospective defendant?

If so, the prospective defendant may argue that the applicant has already determined that there is a cause of action against the prospective defendant (enough to demand against it) and object to the request for preliminary discovery and inspection.

Is there already an arguable cause of action against a prospective defendant?

If it has been determined that the applicant was “unable to obtain sufficient information to decide whether or not to commence proceedings against the prospective defendant” (rule 5.3), and the preliminary discovery does not produce documents that assist the applicant, this may leave the prospective defendant in a position to argue that the litigation is vexatious or argue for costs, if proceedings are later commenced against them.

In those circumstances, it may be advisable to write to the prospective defendant and request informal disclosure in the first instance.

Takeaways

While part 5 of the UCPR and the preliminary discovery procedures can be a useful tool, legal advice should be sought before commencing the process to avoid inadvertently restricting recovery.

If you think you require further information from a prospective defendant or another party to assist in establishing recovery rights, this should firstly be sought on an informal basis.

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If you wish to discuss any of the above, please call Katie Vilsbaek on 02 8047 2887 or one of the Ligeti Partners team members on 03 9947 4500.