Search orders

Acknowledgement: the following material has been prepared by the Honourable Justice P Biscoe of the Land and Environment Court.

Portions of this chapter are adapted with permission from Chapter 7 of P Biscoe, Freezing and Search Orders: Mareva and Anton Piller Orders, 2nd edn, LexisNexis Butterworths, Australia, 2008.

[2-1000] Introduction

Search orders are governed by detailed rules and practice notes introduced in July 2010:

Search orders:

UCPR Pt 25 Div 3 (rr 25.18–25.24)
Practice Note SC Gen 13 (“PN 13”) (see Ritchie’s [150,260]; available on the Supreme Court website at <http://www.supremecourt.justice.nsw.gov.au/>)

The practice note includes example forms of ex parte orders which are complex. They should not be significantly varied without good reason.

In the absence of court specific practice notes, it would be appropriate for the procedure set out in Practice Note 13 to be followed.

An object of the rules, practice notes and forms is to strike a fair balance between the legitimate objects of these drastic orders and the reasonable protection of respondents and third parties. The models for them were drafted by a harmonisation committee of judges appointed by the Council of Chief Justices of Australia and New Zealand. They have been, or are expected to be, adopted in the same or similar form in all Australian jurisdictions and New Zealand.

[2-1010] Search orders

The object of a search order is to preserve evidence needed to prove the applicant’s claim which is in danger of destruction, concealment or removal from the jurisdiction. It does so by ordering the respondent to permit the applicant’s representatives and an independent supervising solicitor to enter, search, copy documents and remove property from the respondent’s premises for safekeeping. A species of discovery of the most extreme kind, it lies at the limit of a court’s civil jurisdiction. The heartland of the search order is copyright infringement and breach of confidence.

A search order is normally obtained ex parte without notice to the respondent and before service of the originating process, because notice or service may prompt the feared destruction or disappearance of evidence.

Search orders are also known as Anton Piller orders. The title “search orders” follows the title used in the English rules. The original name “Anton Piller order” derives from the seminal case of Anton Piller KG v Manufacturing Processes Ltd [1976] 1 Ch 55.

The characteristics of a search order are secrecy, mandatory form and virtually immediate execution. A search order does not permit forcible entry. In that crucial respect it differs from a search warrant. A search party encountering resistance to entry or search must depart: Anton Piller KG v Manufacturing Processes Ltd, above, at 61. The main sanction for disobedience to a search order is contempt of court.

Concern about the draconian effect of search orders, and the fact that they are made against respondents who have not been notified or heard, have led to detailed safeguards being built into the example form of order in Practice Note 13.

Although a search order is normally ex parte and granted before service of the originating process, it has also been granted after judgment in order to obtain documents essential to the execution of the judgment where there was a serious risk that a respondent would remove or destroy them in order to frustrate enforcement: Distributori Automatici Italia SPA v Holford General Trading Co [1985] 1 WLR 1066.

[2-1020] Requirements

The court may make a search order if the following requirements set out in r 25.20 are satisfied (they are modelled on those stated in Anton Piller per Ormiston LJ):

(a) 

An applicant seeking the order has a strong prima facie case on an accrued cause of action;

(b) 

The potential or actual loss or damage to the applicant will be serious if the search order is not made; and

(c) 

There is sufficient evidence in relation to a respondent that

(i) 

the respondent possesses important evidentiary material; and

(ii) 

there is a real possibility that the respondent might destroy such material or cause it to be unavailable for use in evidence in a proceeding or anticipated proceedings before the court.

The crux of the evidence required to obtain a search order often concerns the third requirement that there is a “real possibility” that the respondent might destroy the material or cause it to be unavailable for use unless an ex parte order is made. This will usually require clear evidence of matters such as dishonesty, fraud or contumacy or the transitory nature of the respondent’s business, but such cases may be quite common.

[2-1030] Safeguards

Safeguards for the protection of respondents have been built into the example form attached to Practice Note 13. The most important is the appointment of one or more independent solicitors to supervise the search and report to the court. This is a mandatory requirement and the only safeguard expressly mentioned in the rules: r 25.23. Other safeguards appear in the example form and are mentioned in Practice Note 13. The responsibilities of a supervising solicitor are set out in the example form and are summarised in Practice Note 13 [11] as follows:

[2-1040] Sample orders

The applicant’s solicitor is required to undertake to the court to pay the reasonable costs and disbursements of the independent solicitor and any independent computer expert: PN 13 example form Sch B [1].

[2-1050] Sample orders

Other safeguards for the respondent include the following:

  • The respondent is not required to permit anyone to enter the premises until the independent solicitor serves the order and affidavits and the respondent is given an opportunity to read the order. If requested, the independent solicitor must explain the terms of the order: PN 13 example form [11].

  • Before permitting entry to the premises by anyone other than the independent solicitor, the respondents for a time (not exceeding two hours from the time of service or such longer period as the independent solicitor may permit) may seek legal advice, may ask the court to vary or discharge the order, and (provided the respondent is not a corporation) may gather together anything which the respondent believes may tend to incriminate the respondent or make the respondent liable to a civil penalty and hand them to the independent solicitor. Similarly the respondent may gather together any documents that passed between you and your lawyers for the purpose of obtaining legal advice or for which legal professional privilege or client legal privilege is claimed and hand them to the independent solicitor: PN 13 example form [12].

  • Documents for which privilege is claimed which have been handed to the instructing solicitor must be delivered to the court on the return date without having been inspected by anyone: PN 13 example form [13].

  • Ordinarily a search order should be served between 9 am and 2 pm on a business day in order to permit the respondent more readily to obtain legal advice, and must not be executed at the same time as execution of a search warrant: PN 13 [13] and [14].

  • Anything the subject of a dispute as to whether it is a thing the subject of the search order must promptly be handed by the respondent to the independent solicitor for safekeeping pending resolution of the dispute or further order of the court: PN 13 example form [15].

  • The premises must not be searched and things removed except in the presence of the respondent or a person who appears to the independent solicitor to be the respondent’s director, officer, partner, employee, agent or other person acting on the respondent’s behalf or instructions: PN 13 example form [17]. This requirement may be waived by the independent solicitor if he or she considers that full compliance with it is not reasonably practicable: PN 13 example form [18].

  • If it is expected that a computer will be searched, the search party must include an independent computer expert who has prescribed responsibilities: PN 13 example form [20].

  • Other safeguards appear in the various undertakings by the applicant, the applicant’s solicitor, the instructing solicitor and any independent computer expert which are set out in Sch B to the example form.

[2-1060] Disclosure of customers and suppliers

It has become common for search orders to require respondents to provide information and documents as to their suppliers and customers. Such a provision appears in the PN 13 example form [23]:

[2-1070] Sample orders

[2-1080] Gagging order

Except for the sole purpose of obtaining legal advice, the respondent is usually prohibited until 4.30 pm on the return date from informing anyone of the proceedings or of the contents of the order or from telling anyone that a proceeding has been or may be brought by the applicant: PN 13 example form [25]. A similar obligation is cast on the applicant by undertaking (3) in Sch B to the example form. Such a gagging order has been rationalised on the basis that it gives the applicant an opportunity to use information obtained from the search so as to locate and preserve evidence and assets in the possession or control of others.

[2-1090] Cross-examination

As in freezing order cases, the court may grant leave to cross-examine a respondent on disclosures.

[2-1100] Risks for applicants and their solicitors

Applicants or their solicitors, who do not comply with requirements imposed on them by a search order or who act scandalously on its execution, are in contempt of court, and may be liable in damages to the respondent, and run the risk that the search order may be set aside or not continued. In Long v Specifier Publications Pty Ltd (1998) 44 NSWLR 545 in which the New South Wales Court of Appeal dismissed an appeal from a finding of contempt of court for breaches of undertakings to the court given by a solicitor for the applicant when he obtained a search order for his client.

Another risk eventuated in Canadian Bearings Ltd v Celanese Canada Inc (2006) SCC 36. There privileged documents obtained pursuant to a search order came into the possession of the applicant’s lawyers. The Supreme Court of Canada ordered that those lawyers no longer act for the applicant. This risk should be minimised under [12] and [13] of the example form in PN 13 which permit the respondent to give the independent solicitor any documents for which privilege is claimed in a sealed container, and require the independent solicitor not to inspect or permit anyone to inspect them, and to deliver them to the court on the return date.

Practice Note

  • SC Gen 13 (PN 13)

Rules

  • UCPR rr 25.18–25.24