26 Apr 2012

New Federal Court of Australia discovery rules get their first analysis

by Michael Legg, Jonathan Slater

Reforms to discovery in the Federal Court have been in force since 1 August 2011, so there's now a better idea of how they work in practice.

On 1 August 2011 the Federal Court of Australia adopted the Federal Court Rules 2011 (Cth) and its revised regime for discovery in Part 20 that impacts on the extent and cost of discovery. Part 20 provides for:

  • increased judicial control of discovery
  • a default or standard form of discovery (rule 20.14) that requires that documents be "directly relevant" to issues in the pleading and in the party's "control" after conducting a "reasonable search"
  • a more flexible and responsive non-standard discovery regime (rule 20.15) that can be tailored to the specific case, such as those that are likely to be document intensive, especially where the documents are stored electronically

This regime has been considered in a number of first instance Federal Court decisions that have provided guidance on the new regime and which are discussed below.

Core principles

The new regime for discovery proceeds on the basis of two core principles. First, a party must not apply for an order for discovery unless the making of the order will "facilitate the just resolution of the proceedings as quickly, inexpensively and efficiently as possible". Second, a party is unable to provide discovery unless the Court has made an order for discovery.[1] The aim is to prevent unnecessary discovery (Dennis v Chambers Investment Planners Pty Ltd [2012] FCA 63).

In Alanco Australia Pty Ltd v Higgins (No 2) [2011] FCA 1063 the court expressed "a general concern about the scope, content and utility of the extensive discovery sought by the parties in [the] proceedings" with a view to ensuring that "the parties are not crippled with the cost and delay of [the] process".

Standard discovery

The new rules require a party applying for discovery to specify whether they are seeking "standard discovery" or, alternatively, set out the proposed scope of the discovery, which then requires consideration of the rules dealing with "non-standard and more extensive discovery". The requirements for standard discovery are set out in rule 20.14 and require that the party give discovery of documents:

  • that are directly relevant to the issues raised by the pleadings or in the affidavits; and
  • of which, after a reasonable search, the party is aware; and
  • that are, or have been in the party's control.

For documents to be "directly relevant" the rules require that they must meet at least one of the following criteria:

  • the documents are those on which the party intends to rely; 
  • the documents adversely affect the party's own case; 
  • the documents support another party's case; 
  • the documents adversely affect another party's case.

The direct relevance test was aimed at narrowing the scope of discovery (see Dennis). The meaning of direct relevance is that of relevance in the sense of requiring that the document be directly on point, that it tends to prove or disprove the allegation in issue (Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd (No 2) [2011] FCA 1396).

The criterion that "the documents support another party's case" has also been considered, and interpreted as meaning strengthening of a position, contributing to success, preventing failure or corroborating or substantiating a claim (see Dennis).

Non-standard discovery

The rules provide for a party to seek an order for non-standard discovery but they must address a number of factors including whether the criteria for standard discovery, such as the direct relevant test, or the criteria elaborating on the direct relevance test, should not apply. This enables a party to apply for discovery on the basis that a direct relevance test is too narrow or even to adopt a traditional "train of inquiry test" if warranted by the particular case (see Dennis).

It is possible to have an order for discovery made specifying the criteria that should apply, utilising categories of documents, dealing with discovery through an electronic format (which would be very common in most larger cases today) or through the use of a "discovery plan". A discovery plan is likely to be necessary when documents are stored in an electronic format. The discovery plan includes such matters as the scope of discovery, the location of documents, the preservation of documents, strategies in conducting a reasonable search, management of documents, and approaches to dealing with privilege and confidentiality. [2]

[1] Rule 20.12 and Alanco Australia Pty Ltd v Higgins (No 2) [2011] FCA 1063 at [8].

[2] Federal Court of Australia, Practice Note 6 – Electronic Technology in Litigation, 1 August 2011, Appendix: Pre-Discovery Conference Checklist and Michael Legg and Nicholas Turner, "When Discovery and Technology Meet: The Pre-Discovery Conference" (2011) 21 Journal of Judicial Administration 54.


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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.