Supreme Court provides timely reminder of the Harman undertaking and the consequences of non-party disclosure - Disclosure & Electronic Discovery & Privilege

The Victorian Supreme Court's decision in Re Ramsay Health Care Australia Pty Ltd [2022] VSC 226 deals with the nature and extent of the 'Harman undertaking',¹ which prohibits the use of documents obtained during court proceedings for a collateral or ulterior purpose.

The decision highlights the need for companies, including media organisations, to exercise vigilance when receiving information or documents relating to a court proceeding. This is particularly necessary where the origin of a document is unknown.

A breach of the Harman undertaking is a form of contempt and this can extend to non-party publishers in circumstances where the publisher has actual or inferred knowledge that a document they have relied upon, or republished, was obtained by way of compulsory court process.

The potential penalties for this type of civil contempt, commonly referred to as contempt by disobedience, are imprisonment, fine and/or sequestration.²

Background

In 2020, Dr Elie Khoury sued fellow orthopaedic surgeon Dr David Kirwan for defamation. During these proceedings, Dr Jeremy Kolt, another surgeon at the Albury Wodonga Private Hospital, produced 77 emails between himself and Dr Kirwan, which included disparaging comments about the clinical practice of Dr Khoury. These emails were produced in response to a subpoena.

The content of these subpoenaed emails disclosed alleged breaches of confidentiality and other hospital rules by Dr Kolt. Upon being provided with these emails, Dr Khoury arranged for his wife to send them to the CEO of the hospital, Ms Anne Keir. Ms Keir then used six of the subpoenaed emails to issue a show cause notice to Dr Kolt.

On receipt of the show cause notice, Dr Kolt's solicitors wrote to Ramsay Health Care Australia, owner and operator of the hospital, informing them that the six emails referred to in the notice had been produced under subpoena in the defamation proceeding. The letter asserted that Ramsay was in breach of a Harman undertaking and that their use of the documents may be a contempt of court.³

By way of originating motion, Ramsay sought a hearing to proffer an apology to the Court for any contempt arising from its use of these documents.

Issue

The Court considered whether Ramsay was bound by an obligation to the Court not to use the subpoenaed documents that came into its possession.

The Harman undertaking

Justice Forbes confirmed the obligation arising from the Harman undertaking is not limited to parties in a legal proceeding. Adopting the High Court's reasoning in Hearne v Street,⁴ her Honour confirmed that a Harman undertaking is binding on any individual who comes into possession of a document subject to that undertaking, provided the individual knows that the document was produced in a legal proceeding.

Her Honour emphasised that it is the origin of a document, not the knowledge of the undertaking or its obligations, that is the relevant knowledge when assessing a potential Harman breach. Quoting Hearne, Justice Forbes stated that to require the latter "would be to require proof of knowledge of the law, and general ignorance of the law does not prevent liability".

Expanding on this concept, Justice Forbes clarified that an individual must have actual knowledge that a document originated from a court proceeding to be bound by a Harman undertaking. Notwithstanding, her Honour accepted that actual knowledge may be inferred in circumstances where an individual "wilfully shuts [their] eyes to the obvious or [is] reckless in failing to make obvious inquiries", or where an individual has constructive notice of the circumstances.

Decision

Justice Forbes found that Ramsay had no actual knowledge of the origin of the documents at the time it prepared and sent the show cause notice to Dr Kolt, and therefore could not be found in contempt of court.

Justice Forbes was satisfied that the first of the six emails, which featured the words 'Subpoena emails' in its subject line, was overlooked by Ms Keir due to a combination of strained workload, the volume of emails she was generally dealing with and the repetitive nature of emails sent to her by Dr Khoury's wife.

Her Honour described the oversight as "not deliberate but rather unintended", with Ramsay's principal concern being the alleged breach of confidentiality by Dr Kolt which appeared from the subpoenaed emails, not the feud between Dr Khoury and Dr Kirwan.

Justice Forbes found that even if contempt had been established, Ramsay would have been discharged from punishment. Her Honour found that Ramsay had taken proper and prompt action to purge their contempt by:

withdrawing the show cause notice and deleting the subpoenaed emails;
apologising and acknowledging that the subpoenaed emails should not have been used;
accepting that the inquiries made regarding the emails were inadequate; and
introducing compulsory training to educate its managers on the obligations imposed by Harman undertakings.

Her Honour also noted that Ramsay had incurred a "'substantial financial cost" by bringing the proceeding of its volition, in the absence of a prosecuting third party.

Ultimately, the Court made an order accepting the apologies made on behalf of Ramsay.

Implications

Following this case, companies should pay close attention when receiving documents which relate to, or have formed part of, a court proceeding. In the case of news organisations and journalists, this means following strict procedure when it comes to verifying your sources.

While this decision relates to subpoenaed documents, the Harman undertaking prohibits the use of a variety of court documents including, but not limited to:

documents obtained on discovery;
answers to interrogatories;
documents seized pursuant to an Anton Piller order;
witness statements; and
affidavits.⁵

The prohibitions may cease to apply once the documents have been tendered or relied on in open court. When seeking to rely on a document, it is prudent for recipients to ascertain whether the document has been referred to, read or tendered in court. The decision in Re Ramsay Health Care Australia Pty Ltd serves as a reminder that a failure to make these types of inquiries can amount to a breach of the Harman undertaking, and may constitute contempt of court.

Footnotes

¹ Harman v Secretary of State for the Home Department [1983] 1 AC 280.

² Supreme Court (General Civil Procedure) Rules 2015 (Vic) reg 75.11.

³ Contempt proceedings were also brought against Dr Khoury and his wife - see Khoury v Kirwan (No 4) [2021] VSC 333.

⁴ (2008) 235 CLR 125.

⁵ Fotopoulos v Commonwealth Bank of Australia [2017] VSC 461.</p>

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