Azar Building and Construction Services Pty Ltd v Transport Infrastructure Development Corporation

2. All documents, reports, notes including electronic records (eg emails etc) and any other document in the possession or control of Railcorp (or Bankstown City Council) relating to any dealing, proposed dealing, agreement, scheme or proposal including development proposals that in any way dealt with the Land comprised in Lot 1 Deposited Plan 16430, Lot 2 in Deposited Plan 16430, Lot 2A in Deposited Plan 16430, Lot 3A in Deposited Plan 16430, Lot 2 in Deposited Plan 603762 and part of the area described as Winders Waterholes collectively known as the Bankstown City Car Park situate at 45 Simmons Street, Revesby from January 2007 to April 2010. The Notice addressed to the respondent sought the production of documents in similar terms subject, of course, to seeking only those documents "in the possession or control" of the respondent that met the description otherwise contained in the two paragraphs common to all three documents. 10 Upon receipt of the Notice and upon becoming aware of the Subpoenas, the respondent's solicitors wrote to the applicants' solicitors seeking an explanation of the potential relevance of any of the documents sought to be produced to the issues identified in the applicants' points of claim. In response, the applicants asserted three bases upon which production was required: (i) the public purpose of the acquisition;

(ii) impact on value "in light of the proposed development of the Adjoining Land and the potential for the development of the Acquired Land with the Adjoining Land"; and

(iii) special value 11 This response did not articulate the basis upon which the applicant wished to make good its claim that the "highest and best use" of the acquired land was in accordance with the allegation contained in paragraph 15 of the points of claim. As a consequence, the respondent posed three specific questions by way of a request for particulars directed to paragraph 15. It did so in a letter of 14 May. It noted, correctly in my opinion, that the particulars which were sought had a bearing upon the applicants' entitlement to production of the documents sought in the Subpoenas and the Notice. By letter of that same date, the respondent indicated that unless the applicants' claim was appropriately particularised, an application of the kind presently being considered would be made. A request that the particulars be provided by 17 May was made but that request was not met. In consequence, the present notice of motion was filed on 18 May. 12 By a letter dated 24 May, the respondent sought one further particular of paragraph 15 of the applicants' points of claim. 13 The notice of motion came before me for hearing on 28 May. By that time the only response received from the applicants was one which identified the "adjoining land" referred to in paragraph 15 of the points of claim, but otherwise asserted that the respondent's knowledge of the development potential of the acquired land was well known to it. The response made no attempt to provide the specific four particulars that had been requested.

The respondent's challenge 14 The respondent's motion is brought pursuant to Pt 33 r 33.4 of the Uniform Civil Procedure Rules 2005 (the UCPR). That rule authorises the Court to set aside a subpoena in whole, or in part, on the application of a party "or any person having a sufficient interest". It is accepted that the rule is sufficiently wide to enable the respondent to set aside a subpoena even though it is not the person or entity to whom the subpoena is addressed. No question arises as to the entitlement of the respondent to seek to set aside the Notice, it having been given pursuant to Pt 21 r 21.10 of the UCPR. 15 There are four grounds upon which the respondent relies to sustain its notice of motion. They are: (i) having regard to the manner in which the applicants' notice of motion is framed, in particular paragraph 15, and in the absence of any appropriate particulars of that claim, the forensic purpose sought to be served by the subpoenas and notice cannot be identified;

(ii) the terms in which documents are sought from entities which are not parties to the proceedings are so broad and uncertain that the request is tantamount to a request for discovery against them;

(iii) the impermissible breadth of material sought is exemplified by the request for documents up to April 2010 when the compulsory acquisition of the land took place on 9 October 2009, with the result that documents relating to events after that date can have no materiality to the claim, as presently understood, by the applicants;

(iv) the issue of the Subpoenas and Notice is premature because, in the absence of a response to the particulars sought, whether the documents sought can have any bearing upon an issue or issues is unable to be determined. 16 In further elaboration of these grounds, the respondent contends that the assertion made on behalf of the applicants that the first issue to which the documents may go is one related to public purpose of acquisition is a basis which cannot be sustained, as no issue is raised in relation to that public purpose. Its public purpose as provision for a commuter car park adjacent to a railway station has not been identified as being relevantly contentious. If special value is a basis for claim, then again the documents sought cannot possibly bear upon the issue, having regard to the provisions of s 57 of the JT Act.

The applicants' contentions 17 The applicants resisted the respondent's notice of motion. Essentially, the argument on their behalf was that on the basis of evidence contained in affidavits by Messrs Azar, Ibrahim and Dobrow, the applicants' case was sufficiently well understood. In that context the documents sought did not offend any principle pertaining to the proper identification of documents required in either the Subpoenas or the Notice. 18 It was contended that the acquired land assumed a particular value because of its attraction to the adjoining owner(s) for development along with their lands. As I understood the submission, it was either that this potential was the basis upon which its "market value" should be determined, conformably with s 56 of the JT Act, or alternatively it was special value within the meaning of s 57. Contrary to the assertion made in earlier correspondence as justifying the scope of documents sought, it was acknowledged, in terms, that the documents were not required to address the "public purpose" of the acquisition. That public purpose was not to be the subject of any challenge. 19 Ultimately, although it was claimed on behalf of the applicants that the material available to the respondent was sufficient to enable it to understand the basis of the claim made and therefore to justify production of the documents sought in the Subpoenas and Notice, it was acknowledged that clarity could be brought to the debate if points of claim were amended and particulars provided in response to the respondent's request.

Consideration 20 A consideration of the arguments advanced before me on 28 May indicated that the Subpoenas and Notice were framed in terms that did not enable it to be positively established that a legitimate forensic purpose was served by the Subpoenas and the Notice (Commissioner for Railways v Small (1938) 38 SR(NSW) 564; NSW Commissioner of Police v Tuxford [2002] NSWCA 139; Travel Compensation Fund v Blair [2002] NSWSC 1228). Whether such purpose is met in a given case will turn upon the connection between the issues raised in the proceedings and documents which are the subject of a subpoena or notice to produce. The requisite connection to be established has been variously described. Without intending to be exhaustive, it is apparent that a subpoena or notice to produce will be liable to be set aside where the party seeking production of documents cannot establish: (i) that it is "on the cards" that the documents will materially assist on an identified issue: Alister v The Queen (1984) 154 CLR 404 at 414; R v Saleam [1999] NSWCCA 86 at [11]; Attorney-General for NSW v Chidgey [2008] NSW CCA 65; 182 A Crim R 536 at [58] - [69];

(ii) that the material sought could reasonably be expected to throw light on some of the issues in the principal proceedings: Trade Practices Commission v Arnotts Limited (No 2) (1989) 21 FCR 306; 88 ALR 90 at 103; Cosco Holdings Pty Ltd v Federal Commissioner of Taxation [1997] FCA 1504; (1997) 37 ATR 432;

(iii) that there is a reasonable basis for supposing that the material called for will likely add to the relevant evidence in the case: A v Z (2007) 212 FLR 255 at [4];

(iv) that it is likely the documents will materially assist on an identified issue or there is a reasonable basis beyond speculation that it is likely the document will do so: Air Canada v Secretary of State for Trade (No 2) [1983] 2 AC 394; [1983] 2 WLR 494; ICAP Australia Pty Ltd v Moebes [2009] NSWSC 306; ICAP Australia Pty Ltd v BGC Partners (Australia) Pty Ltd [2009] NSWCA 307. 21 The principle was extensively discussed in ICAP Australia Pty Ltd v BGC Partners (Australia) Pty Ltd. Tobias JA (in whose judgment Basten JA and Handley AJA agreed) considered at [22] the requirement for it to be shown that it is "likely" that the documentation sought will materially assist on an identified issue or the alternative requirement that there be a reasonable basis beyond speculation that it is likely the documentation will so assist was not relevantly different to a requirement that it be "on the cards" that the documents would materially assist on an identified issue. Importantly, all the tests, however stated, require identification of an issue or issues in the proceedings with some modicum of particularity which then becomes the measure against which the forensic purpose of the documents can be determined. It is that identification which must inform the requirement to produce the documents sought. 22 Upon the first return of the applicants' summons before the List Judge on 19 March last, directions were made, by consent, for the further conduct of these proceedings. Those directions included a requirement that the applicant file and serve points of claim. The orders of the Court in that regard were expressed as follows: "1. The applicant is to file and serve points of claim setting out at least the following matters by 1 April 2010:

(b) the components of the claim by reference to each relevant matter enumerated in s 55 of the Land Acquisition (Just Terms Compensation) Act 1991;

(c) the basis of the valuation in support of the claim;

(d) particulars of comparable sales, if any, upon which the valuation was based." 23 It can be accepted that a person or corporation whose land has been compulsorily acquired by an authority of the State should be fully and appropriately compensated for that land so far as the JT Act provides and allows. Equally, it is important, that when formulating a claim which is to be litigated, both the acquiring authority and the court be informed with the requisite degree of particularity of the claim which the dispossessed owner seeks to make. Claims which are inadequately particularised potentially present unfairness to a respondent and equally can provide difficulties for the Court in managing its business, particularly when claims for compensation are allowed to have a fluidity which ultimately requires the allocation of additional Court time extending well beyond the time for which a case is originally fixed to be heard. 24 The vehicle through which the appropriate particularisation is provided is the document to be filed in the form of the applicants' points of claim. The Court's standard directions require as much. It is only by reference to this document and the respondent's reply to it that the issues can be truly identified and a determination made as to the appropriateness of documents required to be produced or evidence tendered. 25 These observations may seem somewhat trite. However, the issue arising on the present notice of motion exemplifies the problem when points of claim are inadequate to the task intended to be served by them. That was certainly so in the present case. Notwithstanding the terms in which Order 1 was made at the directions hearing on 19 March last (see [22]), the failure of the applicants to set out "at least" matters identified in paragraphs (b) and (c) of that order so as to permit a proper understanding of the applicants' claim is the foundation of the present dispute. An understanding of that claim is not to be informed by miscellaneous evidence that might be filed on behalf of an applicant, for such a course inverts the purpose for which points of claim are required. The applicants' case must first be stated before considering whether documents sought to be produced under subpoena or by notice comply with the relevant legal principles pertaining to their production. 26 Although at the conclusion of argument on 28 May I had formed the opinion that the documents which were the subject of the applicants' Subpoenas and Notice could not be shown to meet the principles that I have identified, because of a failure to identify the issues against which the requirement for their production was to be measured, I considered that a further opportunity ought to be afforded to the applicants' to make good their claim to have the appropriate documents produced. Such an approach seemed to me to be consistent with the provisions of Div 1 of Pt 6 of the Civil Procedure Act 2005. To that end I stood over the notice of motion to 8 June and directed, in terms, that the applicant provide the particulars sought in letters dated 14 and 24 May from the respondent's solicitors. 27 By letter dated 4 June, the applicants, through their solicitors, wrote to the respondent's solicitors in purported compliance with the direction that I had made on 28 May. Regrettably, it was not, in terms, a response to the particulars requested in the two letters that were the subject of my direction. Rather, it was a narrative of a claim which the applicants would seek to agitate and it did so by reference to negotiations said to have taken place involving both Bankstown Council and RailCorp. That narrative neither addressed the specifics of the particulars sought nor did it appear to be entirely consistent with the points of claim as pleaded. 28 When the matter next came before me on 8 June, the applicants' solicitor acknowledged that his letter of 4 June was not directly responsive to the particulars sought, as my direction on 28 May had required. He sought to argue that the "narrative" letter of 4 June should have alerted the defendant to the case sought to be made. When it was indicated that such a claim appeared to raise new matters and was not entirely consistent with the points of claim as filed, he acknowledged that the request for particulars could, in terms, be answered and that consideration may need to be given to amending the points of claim already filed. Further directions for the provision of particulars in accordance with the request were made and leave given for the applicants to file further amended points of claim. 29 Amended points of claim were filed on 11 June. While the first sentence of paragraph 15 did not alter from its predecessor, three particulars were added. The first identified potential for a nominated form of development upon the acquired lands together with adjoining land; the second identified the adjoining land to which reference was being made and the third particular asserted that the potential for this development in conjunction with adjoining land "increased the value of the Acquired Land by a factor of no less than 20% above the market value claimed in paragraph 17". 30 Paragraph 16 of the amended points of claim identified the amounts claimed under ss 55 and 59 of the JT Act. In a table to that paragraph, the only reference to s 55 is as follows: "s 55(a) Market Value of the Acquired Land (excluding both the potential to develop with Adjoining $4,200,000.00 Land and Special Value factors)"

31 Paragraph 17 asserts that the market value of the acquired land under s 55(a) "to be no less than $4,200,000 as at the Date of Acquisition". 32 Paragraph 18 is expressed as follows: "The applicants assert the potential to develop the Acquired Land with the Adjoining Land increased the value of the Acquired Land above the market value referred to in paragraph 17 herein by no less than 20%." 33 Paragraph 19 of the amended points of claim then states that in "addition or alternate to the further value referred to in paragraph 18", special value under s 55(b) increased the value of the acquired land above market value by no less than 20%. 34 The respondent's notice of motion next came before me on 16 June. At that time the applicants' counsel acknowledged shortcomings in the manner in which the claim for market value was pleaded. It was accepted that any claim must fit within the heads of claim identified in s 55 of the JT Act and that a claim which asserted market value plus an additional component, being a component not identified in s 55 could not lawfully express a sustainable claim. In consequence, the applicants undertook to provide, that day, particulars of the newly pleaded claim so as to bring it within the purview of s 55. 35 The respondent's notice of motion came before me for the final time on 18 June. By that time the further particulars of the amended points of claim had been provided. Those particulars indicated the basis upon which the applicants would contend for the market value of the acquired land to be determined by reference to its development in conjunction with development upon adjoining land. It explained the 20% uplift which was the subject of its pleading and identified, for the first time, that its claim on this basis involved a contention that the market value of the acquired land was $5,040,000 and that the total claim for compensation was $6,596,740. 36 It is necessary to record that by this time, two further events had occurred. First, by letter dated 10 June 2010, the applicants had responded, in terms, to the respondent's request for particulars as was the subject of my initial direction on 28 May. Secondly, the applicants had indicated the terms in which they were prepared to "amend" the schedule of documents to be produced in accordance with the Subpoenas and Notice originally served. The amended schedule reduced the scope of documents required. 37 In final submissions on 18 June, it was contended on behalf of the applicants that the necessity for them to provide the particulars and amend their points of claim in the manner in which I have described ought to be considered separately from the notice of motion to have the Subpoenas and Notice set aside. Notwithstanding the elaboration upon and change in the case that the applicant made, it maintained that the terms in which it had originally sought production of documents was appropriate. 38 I do not agree. As the recitation of principle earlier cited indicates, the legitimate forensic purpose which informed the requirement for compulsory production of documents can only be considered in the context of an understanding of the issue or issues to which the documents are potentially directed. Those issues have only been satisfactorily identified with the further amendment and further particulars that have been provided, in consequence of the proceedings pertaining to the respondent's notice of motion. In the context of a claim for compensation, a wide ranging requirement for production of documents that might inform an understanding of transactions pertaining to development upon adjoining land, without first identifying the statutory foundation for such a claim, cannot be sustained. Fundamental to the determination of "market value" within the meaning of s 55 is consideration of the "highest and best use" of the acquired land. As the applicants' claim has evolved, it has been variously described in the following way:

(a) "a Carwash/Café and offices with potential for development with adjoining land " - Points of Claim filed 1 April 2010, paragraph 15;

(b) "a proposed use of the combined site was … the Aldi Proposal ….[with] the inclusion of the 'current use' (i.e. car wash , etc) into the basement level of the new building but essentially delivering all that Aldi (and Council) required for the commercial/car parking use of the combined site" - Applicants' letter of 4 June 2010 ( Exhibit 2 ).

(c) the use described in (a), with the potential for development on the acquired land with the adjoining land said to be " a multi storey car park facility that includes the current use as well as residential and other commercial elements with access to the main road through the acquired land" and the assertion that this potential "increased the value of the acquired land by a factor of no less than 20% above market value - Amended Points of Claim filed 11 June 2010, paragraph 15.

(d) as above, but " an example of the type of development possible is demonstrated in the plans prepared by Architects for Aldi …[with] retail space of approximately 265 metres squared… on the Acquired Land…[and] a retial space… of approximately 1450 metres squared would be developed on the adjoining land, other elements were subject to further negotiation" - Applicants' letter of 10 June 2010 ( Exhibit B ). 39 In light of the amendments made to the points of claim and the particulars now provided, it seems to me that the applicants' are now in a position to identify documents from Bankstown City Council, RailCorp and the respondent which are documents that are likely materially to assist it on the issue of development in conjunction with adjoining land, having regard to the basis for such claim as is now pleaded. That could not be said of the documents sought to be produced under the Subpoenas and the Notice. 40 It is for these reasons that the original Notice and Subpoenas addressed to RailCorp and Bankstown City Council have been set aside. In light of the amendments and particulars, I note that the respondent has agreed to produce informally to the applicants those documents pertaining to meetings identified by the applicants and said to have involved the respondent concerning the land and adjoining land prior to acquisition. Meetings concerning the adjoining land identified by the applicants and its co-development with the acquired land involving both RailCorp and Bankstown City Council could now, no doubt, be the subject of appropriately framed subpoenas.

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