Lawyers and financial backers who assisted Ben Roberts-Smith in his multimillion-dollar defamation trial have been ordered to hand over thousands of documents which will show their level of involvement, as the dispute over who will pay costs of the mammoth proceeding continues.
Earlier this year, Federal Court Justice Anthony Besanko ruled some of the imputations against Mr Roberts-Smith put forward across six articles by The Sydney Morning Herald, The Age and The Canberra Times were substantially true and dismissed the case.
The newspapers had accused Mr Roberts-Smith of war crimes, with the case expecting to have cost more than $25m in legal fees.
Justice Besanko on Monday rejected a bid by Seven West Media chairman Kerry Stokes, his private company Australian Capital Equity (ACE), Seven Network commercial director Bruce McWilliam and law firms Herbert Smith Freehills and Mark O’Brien Legal to have subpoenas set aside.
Subpoenas were issued to all parties by Nine Newspaper to show communications between the financial backers and the lawyers to show their involvement in the trial.
A hearing was conducted last week to have the subpoenas thrown out, but Justice Besanko on Monday ruled largely in favour of Nine. His reasons will be published at a later date.
The trial was funded at first by the Seven Network before a loan agreement was reached with Mr Stokes’ private company ACE.
Documents tendered to the court revealed ACE asked for an additional 15 per cent on top of the loan repayment if Mr Roberts-Smith won the case.
A third-party order for costs was made by Nine Newspapers following the judgment, with the application seeking costs from the Seven Network, its owner billionaire media mogul Mr Stokes and his private company.
The subpoenas were part of the application, with Nine seeking to show how ACE and Seven sought to “control” the proceedings.
Neil Young KC, who represented the Seven and ACE respondents, last week told the court Nine was conducting a “fishing expedition in the nature of discovery” as their subpoenas sought more information than they needed.
“The primary grounds for setting aside the further subpoenas set on my clients is that they are far too wide, they lack the necessary particularity … they have no legitimate forensic purpose,” Mr Young told the court.
“They are undertaking a trawling exercise in the nature of discovery.”
Mr Young accused Nine of casting a “drag net” in relation to the loan agreements between Seven and ACE, which have been “on foot for a very lengthy time”.
“The argument run by the respondent to our application is unsound,” Mr Young said, referring to Nine.
Mr Young said Nine was seeking “any document” relating to the loans from Seven and ACE, which was “completely disconnected to any issue that arises” on the costs application.
He said the subpoenas require an “extensive searching exercise of anything referring or relating to proceedings” including eight people, which includes “every conceivable type of communication”.
Nicholas Owens SC, on behalf of Nine Newspapers, told the court his opponents were “overplaying” the burden involved in physically producing the documents, while seeking to “downplay” the documents themselves.
He told the court the involvement of Seven, ACE and its offices were critical in commencing the proceedings as Mr Roberts-Smith was “not in a position” to fund the case on his own.
“Seven wanted Mr Roberts-Smith to have access to lawyers he would not be otherwise able to afford,” Mr Owens said.
“They had a clear involvement in the decision to commence … and the calibre of the lawyers.”
He argued more than 8600 emails between Mr Roberts-Smith, his legal team and Mr McWilliam meant they did more than observe the case.
“I think the litigation went for just over 100 days, that seems to be an average of about 86 emails a day,” Mr Owens said.
“We say that provides a very strong presumption … there is something more than mere observation going on.”
Mr Owens said everything Seven and ACE were doing was to achieve a successful outcome: “They thought they were a meaningful ingredient to achieve a victory”.
Mr Roberts-Smith was earlier this year found to be an inconsistent witness with “motives to lie” in the scathing assessment by Justice Besanko, who dismissed the proceedings.
The disgraced soldier has since appealed, with the appeal aimed at finding error in Justice Besanko’s factual findings and is expected to cost about $1m, on top of the $25m already spent in legal fees throughout the case.
Mr Roberts-Smith’s lawyers argue Justice Besanko “erred in his findings” Mr Roberts-Smith was involved in four murders of unarmed prisoners in Afghanistan between 2009 and 2012.
A two-day hearing for the costs application against Mr Roberts-Smith, Seven and ACE has been set down for September 4.