Bluetag Australia Pty Ltd v BCC Trade Credit Pty Ltd trading as Bond and Credit Co

1. Risk Mitigation Solutions Pty Ltd (ACN 058 206 358) be joined as third respondent.
2. The interlocutory application filed on behalf of the first and second respondents on 10 November 2023 be dismissed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

STEWART J: 1 The first and second respondents seek leave under r 24.01 of the Federal Court Rules 2011 (Cth) to issue subpoenas to produce documents on two Singaporean corporations, LTB Overseas Pte Ltd and Longview Resources (SG) Pte Ltd. The first and second respondents also seek leave pursuant to r 10.44 of the Rules for service of the subpoenas on those corporations in Singapore. 2 Although the applicants were given notice of the interlocutory application, they have indicated that they do not wish to be heard on it. 3 The underlying proceeding concerns a claim by the applicants for indemnity under a policy of insurance issued by the second respondent. The policy is a form of trade credit insurance. The applicants contend that the policy is responsive to loss and damage allegedly suffered by the applicants when their contractual counterparties for the purchase of various shipments of commodities failed to pay for the goods purchased. 4 Amongst other transactions, the applicants contend that the second applicant purchased commodities from LTB Overseas under two contracts and sold commodities to Longview under four contracts. They contend that Longview and other on-buyers to whom the second applicant sold commodities purchased from LTB Overseas and other suppliers failed to pay for the commodities, and that the second respondent is required to indemnify them under the policy for loss suffered as a result. 5 The first and second respondents do not know and so cannot admit that the second applicant entered into the six contracts in question, or that title to the commodities the subject of those contracts for sale passed from the suppliers (LTB Overseas and others) to the second applicant and from the second applicant to the on-buyers (Longview and others). The first and second respondents contend that unless the applicants are able to prove those matters, any loss suffered by the applicants is not within the scope of the policy. 6 The proceeding is currently still in the pleadings phase, the applicants most recently having filed an amended originating application and statement of claim on 22 November 2023. An amended defence, a defence from the third respondent (an insurance broker) and replies are still to be filed and served before consideration will be able to be given to questions of evidence and discovery. I interpose to say that an order should also be made joining the third respondent. That is by consent of the existing parties. 7 The first and second respondents contend that LTB Overseas and Longview may have in their possession documents that are relevant to the disposition of the proceeding. The categories of documents that the respondents aim to procure by way of the proposed subpoenas in respect of each relevant sales contract or transaction may be summarised as documents recording the following: (1) the negotiations between the second applicant and each of the addressees with regard to the volume and price of the commodities; (2) payments by the second applicant to LTB Overseas and by Longview to the second applicant for the commodities; (3) transmission of any bill of lading by LTB Overseas to the second applicant and by the second applicant to Longview; and (4) transmission of any invoices, packing notes or purchase orders by LTB Overseas to the second applicant and by the second applicant to Longview. 8 The documents are said to be relevant to key issues in dispute between the parties likely to occupy the trial, including the insurer's state of satisfaction that the debts allegedly incurred by the applicants in fact arose. Mr Cameron, who appeared with Mr Clarke for the first and second respondents, accepts that the documents are not required for the purpose of preparing an amended defence to the applicants' amended statement of claim, although he submits that the documents could bear upon the preparation of the amended defence if they were made available. 9 Mr Cameron tendered a letter from Clyde & Co Clasis Singapore (as I understand it, they were or are the insurer's Singaporean lawyers) to the applicants dated 8 July 2021 and a letter from Kennedys (the first and second respondents' Australian lawyers) to Emerson Lewis Lawyers (the applicants' Australian lawyers) dated 8 September 2023. By those letters, the first and second respondents apparently requested documents which would include the documents, or at least some of them, that are the subject of the intended subpoenas but they received no, or no favourable, response from the applicants. That is regrettable. 10 There is also evidence that the first and second respondents have by correspondence from their solicitors to each of LTB Overseas and Longview requested the documents covered by the intended subpoenas, but they have received no response. 11 Mr Cameron submits that the lack of response, or positive response, from the applicants and the addressees of the intended subpoenas demonstrates the need for the subpoenas, or at least justifies the issue and service of the subpoenas. 12 I accept, as submitted by Mr Cameron, that the Court has the power to authorise the issue of subpoenas for service on an overseas entity. That much is apparent from rr 24.01 and 24.12 with regard to the issuing of subpoenas and r 10.44 with regard to the service of documents other than an originating application outside Australia and the decision of Wigney J in Ceramic Fuel Cells Ltd (in liq) v McGraw-Hill Financial Inc [2016] FCA 401; 245 FCR 340 at [55]. However, as observed by Wigney J at [59], the court is required to exercise caution and restraint in cases involving the issue and service of a subpoena on a foreign addressee. That means that the facts and circumstances of each case will need to be closely considered. His Honour identified that those facts and circumstances will most likely include: the nature of the subpoena; the nature of the particular proceedings and (in the case of a subpoena to produce documents) the importance of the documents to the issues in those proceedings; the attitude of the subpoenaed party (if known or ascertainable); the foreign country involved; and the law in, and attitude of, the foreign country regarding foreign subpoenas and whether they impinge upon the country's sovereignty. 13 There is also another important consideration, which is that there is no ready means of enforcing a subpoena authorised to be issued and served on a foreign addressee where the cooperative machinery, whether executive or judicial, of the foreign country is not used for that purpose. In that regard, in Stemcor (Australasia) Pty Ltd v Oceanwave Line SA [2004] FCA 391 at [12]-[13], Allsop J declined to authorise service of a subpoena on a foreign entity on the basis that service of an order upon such an entity demanding that it do something in Australia on pain of punishment in proceedings to which it has not submitted is such an invasion of another country's sovereignty as not to be contemplated except in the most exceptional circumstances. His Honour observed that in the absence of enforcement procedures, the order embodied by the subpoena is an empty threat, or the equivalent of a mere request couched in imperative terms. His Honour said that the Court should not be seen to be engaged in such conduct. 14 Mindful of those matters, I am not persuaded that the issue of the contemplated subpoenas and service of them in Singapore should be authorised, at least not at this stage of the proceeding. That is principally because in my view the relevant documents should first be sought from the parties to the dispute, principally the applicants but possibly also, I suppose, the third respondent. If the applicants do not cooperate by responding positively to requests for the documents, then the compulsory machinery of the Court such as orders for discovery or notices to produce should be employed. It is only after those processes have been exhausted that the Court will be in a position to assess whether it is indeed justified to burden a foreign corporation which is not otherwise amenable to the jurisdiction of the Court with having to respond to a subpoena in respect of which enforcement is highly questionable. 15 I take into consideration the relevant Rules of Court 2021 (Singapore), O 64 of which has usefully been made available by Mr Cameron. Order 64 provides for "Service of foreign process". Rule 2 deals with service of foreign legal process pursuant to a letter of request. That is a process whereby such a letter is received by the relevant Minister and sent to the Supreme Court with an intimation that it is desirable that effect should be given to the request. Further processes in that regard are provided for. 16 In contrast, O 64 r 3 provides for an alternative mode of service of foreign legal process. It applies in relation to the service of "any process required in connection with civil proceedings pending before a court or other tribunal of a foreign country" where r 2 does not apply or is not invoked. It then provides that service of any such process within Singapore may be effected by a method of service authorised by the Rules for the service of an analogous process issued by the Supreme Court. It is expressly provided that r 3 applies even though the foreign process is expressed to be or includes a command of the foreign sovereign. 17 Mr Cameron relies on that rule in support of the submission that in making express provision for the service of a foreign process within Singapore, the Singaporean authorities have made it clear that they do not consider the service of an Australian subpoena in their territory to impinge in any way on Singaporean sovereignty. Mr Cameron submits that, accordingly, issuing and serving a subpoena on a person located in Singapore will not result in breach of international law or raise any issue of international comity. He refers in support of that submission to Georges (Liquidator), in the Matter of SIRA Pty Ltd (In Liquidation) [2022] FCA 768 at [11]-[13] per McEvoy J. 18 One potential difficulty with that approach is that O 64 r 3 is expressly subject to O 64 r 4. Rule 4 applies "in relation to the service of any process required in connection with civil proceedings pending before a court or other tribunal of a foreign country, being a country with which there subsists a Civil Procedure Convention providing for service in Singapore of process of the tribunals of that country, where a letter of request from a consular or other authority of that country requesting service on a person in Singapore of any such process sent with the request is received by the Registrar." It was not explored before me, or apparently before McEvoy J in Georges, whether r 4 would apply in relation to a process from Australia, and if so whether that would exclude the availability of the processes envisaged by r 3. 19 Be that as it may, even on the assumption that the simplified processes in r 3 are available, and that that signifies an acceptance by Singapore that service of an Australian process on a Singaporean company in Singapore would not offend against its sovereignty, I am not satisfied that the discretion should be exercised in this case at this time. That is for the reasons already given. 20 Mr Cameron also points out that certain of the documents captured by the subpoenas are not likely to be in the possession of the applicants. In particular, he identifies documents recording the "transmission" of bills of lading and other shipping documents (invoices, packing notes or purchase orders) to the second applicant. That is to say, documents in the possession of, for example, LTB Overseas which record it "transmitting" (eg, by sending by courier) the shipping documents to the second applicant. He also identifies documents recording the "transmission" of shipping documents from the second applicant to Longview, although it seems to me that wording describing the receipt of such documents by Longview would be more apt to capture documents in the possession of Longview that would not be expected to be in the possession of the second applicant. 21 Once again, I am prepared to accept that there may be documents captured by the subpoenas that would be expected to be in the possession of the addressees of the subpoenas and not in the possession of any of the applicants. Nevertheless, it may be that after the applicants have produced their relevant documents, whether informally or under compulsory process, that such documents will no longer be required. Thus, it may be that the exhaustion of processes as between the parties to the litigation will relieve the need to issue and serve subpoenas on foreign corporations. 22 In the circumstances, and recognising that the proposed subpoenas will likely have to be substantially amended in the event that a renewed application is made, I will simply dismiss the interlocutory application. I certify that the preceding twenty-two (22) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Stewart.