HIS HONOUR: These proceedings are fixed for hearing for six weeks to commence on 29 February 2016. As part of their preparation for hearing, the first to ninth defendants caused a subpoena to be issued, and sought to serve it, on a company known as Marketing Eye Pty Limited (MEPL). An attempt was made to serve the subpoena at the then registered office of MEPL, but this miscarried.
The last date for service of the subpoena was 19 January 2016. The subpoena was to be returnable before the Court on 28 January 2016.
The affidavit evidence includes voluminous (and repetitive) print-outs of e-mails exchanged between the solicitors for the first to ninth defendants and a Ms Mellissah Smith. The evidence discloses that Ms Smith is and has at all material times been the sole director, the secretary (and to the extent it matters) the sole shareholder of and in MEPL.
The e-mails satisfy me, certainly on the balance of probabilities and in reality beyond reasonable doubt, that Ms Smith became actually aware of the subpoena and its contents, and of its requirements, no later than 19 January 2016. Given that she was dealing with the subpoena on behalf of MEPL, and given her offices in relation to the company, it is obvious that her knowledge must be imputed to, so as to become the knowledge of, MEPL.
Armstrong Strategic Management and Marketing Pty Limited v Expense Reduction... [2016] NSWSC 49 | Case summary | Zoe
At first, Ms Smith sought to deflect compliance with the subpoena by claiming that it would cost a very large sum of money - said to be about $23,000 - for MEPL to comply with its requirements. The solicitors for the first to ninth defendants discussed that matter with her, as part of the e-mail correspondence to which I have referred. In the course of that, Ms Smith apparently became aware that it was possible for MEPL to complete the "declaration" forming part of the subpoena by stating in effect that there were no documents to produce. This in due course she did. Her actions in doing so are manifestly inconsistent with her assertions in correspondence and in conversations (to which the affidavits depose), that MEPL had many documents which would be difficult and extremely expensive to locate.
It seems to me to be reasonably clear, having regard to what I know of the issues to be fought between the plaintiffs and the defendants, that the documents sought from MEPL may be relevant, and perhaps significant, in the resolution of those issues. It seems to me, also, to be an available inference that MEPL, or Ms Smith standing behind it, is dissembling, pretending to have no documents when in fact it would appear there may be numerous documents.
The application before me is one for the making of an order under s 68 of the Civil Procedure Act 2005 (NSW). That section provides, in substance, that the Court may by subpoena or otherwise order a person to attend before the Court to be examined as a witness or to produce a document or thing. It is clear that the power may be exercised where there is good reason to think that a third party on whom a subpoena has been served, or that has become aware of the terms of the subpoena despite some defect in service, has failed to comply with the subpoena, and where there is good reason to believe that the subpoenaed party does in fact have documents to produce that would answer the subpoena. The principles were discussed by Brereton J in Hexiva Pty Ltd v Lederer [2006] NSWSC 591 and by Slattery J in Iacullo v Remly Pty Ltd [2010] NSWSC 980. I do not wish to add anything to what their Honours there said. Nor do I wish to encumber these reasons, which are given late on a Friday, by setting out extensive citations from their Honours' respective reasons.
On all the evidence, as I have briefly summarised it, I am satisfied that the subpoena came to the attention or notice of MEPL and Ms Smith by no later than the last date for service. I am satisfied that MEPL, through Ms Smith, was aware of the requirements imposed on it by the subpoena. I am satisfied that there is at least a likelihood - I would have, an almost certainly - that MEPL, contrary to the declaration that it provided to the Court, does in fact have documents that would answer the subpoena, that it has failed to produce.
Of course, there is the question of the reasonable costs of production. That was the matter first agitated by Ms Smith in her discussions with the legal representatives of the first to the ninth defendants. They pointed out, correctly, that the Court could order their clients, as the issuing parties, to pay the amount of reasonable loss or expense that MEPL might incur in complying with the subpoena. That follows necessarily from UCPR Rule 33.11(1). There is nothing in the rule that requires the amount to be paid, as it were, up front, let alone any requirement that what may very well prove to be an exorbitant amount demanded by the recipient of the subpoena should be paid up front.
Of course, I am not to be taken as expressing a final or concluded view that the amount demanded was exorbitant. I do no more than observe that it seems to be somewhat large, having regard to the relatively narrow ambit of the subpoena. Regardless, the failure to pay the amount up front cannot be a reason for non-compliance, and there may well be an available inference that Ms Smith realised this, and accordingly took refuge in the proposition that there was nothing to produce.
In all the circumstances, I am satisfied that it is appropriate to make the order sought: the order under s 68 of the Civil Procedure Act. Service of the order - at least, personal service - may prove to be somewhat problematic. It seems to be the case that MEPL conducts its business in Brisbane, Sydney and Melbourne. Certainly, whilst all this was happening, it changed its registered address from an address in Sydney to an address in Melbourne. There is material in the affidavit that makes it clear that Ms Smith is regularly in the Sydney office. However, she may not be there at any given time, when documents are left there.
In all the circumstances, I think that it is appropriate to direct that service should be effected by e-mail to Ms Smith at her email address, [XXXXXXXXXXXXX], and to [XXXXXXXXXXXX] which I am satisfied is the general contact address for MEPL. That is to be done by 6.00pm today. It is also desirable that copies of the orders be delivered to Ms Smith at each of MEPL's business addresses. That should be done by courier by no later than 5:00pm on Monday next, 8 February 2016.
In all the circumstances, including that the matter is listed for hearing to commence at the end of this month, the examination should be conducted sooner than later, and should be conducted before a Judge sitting in the Commercial List. Since I appear to have assumed the role of duty judge this afternoon, I will list the matter before myself at 10.00am on a date convenient to the applicants, the first to ninth defendants. I will however do so on the basis if Ms Smith is genuinely inconvenienced by the date chosen, the applicants are to negotiate with her in good faith to arrange a mutually convenient and early date for the conduct of the examination.
I make the orders set out in paragraphs 1 and 2 as amended of the short minutes of order initialled by me and dated today's date.
I direct that these orders be served by e-mail on Mellissah Tina-Marie Smith in the following manner:
1. By e-mail to [XXXXXXXXXXX] by 6.00pm today;
2. By e-mail to [XXXXXXXXXXX] for the attention of Ms M Smith, by 6.00pm today; and
3. By delivery to the offices of Marketing Eye Pty Limited for the attention of Ms M Smith at Level 4, 134 William Street, Woolloomooloo NSW, Level 3, 499 St Kilda Road, Melbourne, Victoria and Central Plaza, Level 21, 345 Queen Street Brisbane, Queensland in each case by 5:00pm on 8 February 2016.
I grant leave to Ms Smith to seek to vary the date for her examination and in the event that she does so, I direct the applicants, the first to ninth defendants, to negotiate with her in good faith to obtain an alternative early and mutually convenient date for that examination.
I direct that when the documents are delivered to the three street addresses that I have indicated, there be delivered with them the affidavit of Joseph Khoury sworn 15 January 2016, the affidavit of Nicholas Daniel Riordan affirmed 31 January 2016, the affidavit of Mr Riordan affirmed today's date and the "third affidavit" of Mr Riordan affirmed today's date.
I direct that these orders be entered forthwith.
[3]
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 10 February 2016
Parties
Applicant/Plaintiff:
Armstrong Strategic Management and Marketing Pty Limited