CCOM Pty Limited v Jiejing Pty Ltd

REASONS FOR JUDGMENT (ex tempore) There is before the Court a motion brought by an amended notice of motion filed on 8 October 1998. Unfortunately, this matter has had a sorry history and it is no pleasant task to have to recount it, but it is necessary to do so. The substantive application was filed on 25 October 1996. The applicants alleged breach of copyright and infringement of trade mark. The substantive proceeding was concluded on 14 August 1997 by the making of consent orders. The first respondent, who is the moving party on the present motion, consented to injunctions against her. Orders 1 and 2 restrained her from reproducing or authorising the reproduction of certain identified films, described in the orders as "the applicants' films", and doing certain other acts which would infringe the applicants' copyright in the films. The second order restrained her from doing certain acts which would infringe the applicants' trade marks. The applicants apparently allege that on or about 16 April 1998, at premises at 2/2462 Gold Coast Highway, Mermaid Beach, Queensland, the first respondent disobeyed orders 1 and 2 by reason of a transaction entered into at that time and place with a person called Chi Chung Lam, also known as George Lam and Gary Lam. On 16 July 1998, the applicants filed a notice of motion and a statement of charge. By the notice of motion they seek a finding of contempt by the first respondent for failure to comply with orders 1 and 2. They seek, in consequence, punishment of her for contempt by a fine or otherwise, and an order for costs. Accordingly, and importantly, they seek no relief other than the imposition of a penalty for contempt of court. The contempt motion was returnable before me as Duty Judge at 11.45 am on 24 July 1998. On that date counsel appeared for the applicants and mentioned the matter for counsel for the respondent. I was informed that the first respondent had indicated that she wanted time to put on affidavit evidence. Accordingly, a direction was made that she file and serve affidavits by 5 August, the applicants were directed to file and serve affidavits in reply by 17 August, and the motion was stood over to 20 August for further directions. On 20 August 1998 counsel again appeared for the applicants and again there was no appearance for the first respondent. However, Mr Adamson, solicitor for the first respondent, had telephoned the applicants and my Associate that morning to indicate that he had received instructions late and had to attend court elsewhere. The first respondent had not complied with the direction to file and serve her affidavits by 5 August. I extended the time for the filing of her affidavits to 27 August and the contempt motion was listed for further directions on 28 August. On 28 August counsel appeared for the applicants again. Initially there was again no appearance for the first respondent, who had again not filed any affidavits. The applicants' motion for contempt was fixed for hearing on 2 September 1998 at 9.15 am with an estimated hearing time of one hour, that is from 9.15 to 10.15, prior to the commencement of another hearing that day. After the order fixing the matter for hearing had been made, Mr Adamson appeared and the matter was again called. No change was made to the orders and Mr Adamson was informed that the first respondent's affidavits could be filed and it would be decided at the hearing on 2 September, only five days later, whether they would be allowed to be read. That decision would, of course, have to take into account such matters as the contents of the affidavits, when they were filed and served, the nature of the motion as one for contempt, and any prejudice to the applicants arising from the late filing. On 2 September at 12.30 am, that is in the very early hours of the morning, a facsimile copy of an affidavit of the first respondent was received by the Court, and, apparently, by the solicitors for the applicants. When the motion for contempt was called on for hearing, counsel for the applicants again appeared, no doubt ready to proceed with the hearing of the motion. Mr Adamson, the solicitor for the first respondent, again arrived late. He apologised, saying that he thought the matter was listed for a later starting time. The hearing could not proceed as the first respondent was not available for cross-examination on her affidavit received. There was no suggestion by Mr Adamson that she should not be able to be cross-examined. The hearing was adjourned to 8 September, again at 9.15 am, for a one hour hearing. The first respondent was ordered to pay the applicant's costs of 2 September, on the basis that those costs be taxed and paid forthwith. I granted liberty to the applicants to file and serve a notice to produce returnable before the Registrar at 9.15 am on 7 September. It was not suggested by Mr Adamson that this was not appropriate. The applicants did issue a notice to produce that day (2 September) returnable before the Registrar on Monday, 7 September. Apparently when the notice to produce was called before the Registrar that day, there was no appearance for the first respondent and of course no documents were produced. On Tuesday, 8 September at 9.15 am, at which time the hearing of the contempt motion was due to begin, counsel for the applicants again appeared. Mr Adamson, solicitor for the first respondent, again arrived late. When he arrived he informed the Court counsel who was briefed to appear for the first respondent on the hearing had advised him that the matter would require a hearing of three days (this was the first time that this had been mentioned) and could not possibly proceed on that day. Mr Adamson said that counsel had told him that he would wish to cross-examine deponents of affidavits to be read by the applicants. Again the hearing had to be adjourned. It was fixed for hearing, as it still is, on 2, 3 and 4 November. Again the one hour set aside had been wasted. On this occasion I ordered the first respondent to pay the applicants' costs of Tuesday, 8 September on an indemnity basis, such costs to be taxed and paid forthwith, but I suspended the operation of the costs orders until the first day of the hearing, 2 November. I stood over the notice to produce to 23 September at 9.30 am before the Registrar. I directed the first respondent to file and serve any affidavits by 6 October. The motion for contempt was stood over to Wednesday, 7 October for review of the state of readiness for the hearing. On 23 September before the Registrar, the solicitor for the first respondent informed the Registrar that no documents were produced as the first respondent was invoking the privilege against self-incrimination. This was the first occasion that this matter had been raised. The Registrar directed the first respondent to file a notice of motion to set aside the notice to produce and affidavit in support by 4.00 pm on 30 September. The notice to produce was stood over to 7 October before me (it will be recalled that 7 October was the date fixed for the review of the state of readiness for hearing of the contempt motion itself). Yet again the first respondent did not comply with an order of the Court. She did not file a notice of motion seeking to set aside the notice to produce and affidavit in support by 4.00 pm on 30 September. However, on 1 October she filed and served a notice of motion. The notice of motion sought three "declarations". The first was a declaration that she was not obliged to produce the documents referred to in the notice to produce; the second was a declaration that orders subsequent to the issue of the notice to produce including costs orders be all set aside; and the third was an order that the applicants were liable to pay the first respondent the costs of all proceedings in relation to the notice to produce including the costs of the present motion, such costs to be agreed or failing agreement to be taxed. In view of the previous history of the matter, the second "declaration" and the first part of the third, in particular, were truly remarkable. The affidavit filed in support of the notice of motion was an affidavit of Mr Adamson sworn 1 October 1998. The affidavit was, in substance, in the nature of a submission. It stated that the object of the applicants' motion was nothing other than to punish the first respondent for contempt, and that because of the rule against self incrimination, he (Mr Adamson) had advised the first respondent that she could not be compelled to produce the documents. On Wednesday, 7 October, the matter was again listed at 9.30 am. Yet again there was no appearance for the first respondent. The parties were called and I was about to decide whether the first respondent's motion should be dismissed or stood down when Mr Adamson arrived some five minutes late, saying that the trains were running late. There was some brief discussion about the first respondent's motion but there was little time available and the matter was stood down to 12.45 pm when there was a further quarter of an hour of discussion. I raised the point with Mr Adamson that the motion did not seek a setting aside of the notice to produce and that it seemed to me that the notice to produce operated as an order of the Court which must be complied with unless and until set aside. He seemed to agree that he would wish to apply to have the notice to produce set aside and I directed that the first respondent file and serve any amended notice of motion yesterday returnable today. That has happened: it is by the amended notice of motion before the Court this morning that the first respondent, for the first time, seeks an order that the applicants' notice to produce be set aside. It may be said that on any reckoning the documents should have been produced to the Court this morning pending the decision on the present motion to set aside, but it has seemed practicable to proceed to deal with the matter without further delay. Order 33 r 12 (1) of the Federal Court Rules provides: "Where a party to any proceedings serves on another party notice requiring the party served to produce at any trial or hearing in the proceedings, or before any Judge, officer, examiner or other person having authority to take evidence in the proceedings any document or thing for the purpose of evidence and the document or thing is in the possession, custody or power of the party served, the party served shall, unless the Court otherwise orders, produce the document or thing in accordance with the notice, without the need for any subpoena for production." The rule has been interpreted as giving a notice to produce the same coercive effect as a subpoena for production and making compliance mandatory unless production is excused by the Court: CCOM Pty Limited v Jiejing Pty Ltd (1992) 37 FCR 1 at 3; Trade Practices Commission v Abbco Iceworks Pty Ltd (1994) 52 FCR 96 at 132. It has not been submitted that I should not proceed on this basis. Order 33 r 11 (1) provides: "Where the Court, by subpoena or otherwise, orders any person to produce any document or thing, and any person makes and substantiates sufficient lawful objection to production on grounds of privilege, the Court shall not compel production of that document or thing except production to the Court for the purpose of ruling on the objection." In this case the sole object of the applicants' motion is to impose a penalty for contempt and the sole object of their notice to produce is to compel production of documents "for the purpose of evidence" to aid them in achieving that result. I think that in accordance with the authorities the notice should be set aside: The King v Associated Northern Collieries (1910) 11 CLR 738 at 741-743; Pyneboard Pty Limited v Trade Practices Commission (1983) 152 CLR 328 at 335-336; Refrigerated Express Lines (Australasia) Pty Ltd v Australian Meat and Livestock Corporation (1979) 42 FLR 204 (FCA/Deane J) at 207-208; Master Builders Association of New South Wales v Plumbers and Gasfitters Employees' Union of Australia (1987) 14 FCR 479 at 483. Counsel for the applicants submits that the documents should be produced to the Court at this stage and that claims for privilege against self-incrimination should be made in respect of the individual paragraphs in the notice to produce (there are ten such paragraphs). He refers to the principle that in claiming the privilege against being compelled to answer questions in the witness box, the claim must be made in respect of each question rather than en globo. However, I think that the position is different here. In the ordinary case of oral testimony the answering of some questions may not incriminate and may merely relate to the issues involved in the substantive proceeding in which the evidence is given. In the present case, however, the only purpose of production of the documents is to aid in the imposition of a penalty for contempt of court, since this is the only purpose of the applicants' motion. This is inevitably so in relation to all 10 paragraphs of the notice. The more troublesome aspect of the present motion concerns the question of testing the credit of the first respondent on her affidavit. Are the applicants to be in the position that the first respondent's affidavit, which I should note was filed in its original (as distinct from facsimile) form on 2 September and bears date 1 September, is to be untested? In W R Carpenter & Co Pty Ltd v Wollongong Instant Scaffolds Pty Ltd (1992) 36 FCR 10, Beaumont J allowed cross-examination on an affidavit of a Mr Zeitsch who was one of the persons being charged with contempt in that case. His Honour said that he had a discretion whether to allow the cross-examination and that he did so because the affidavit raised a positive case and it seemed to him only fair to allow that case to be tested. In her affidavit, the first respondent makes some positive assertions as well as denying that she breached orders 1 and 2 made on 14 August 1997. But it is not known at this stage whether that affidavit will be read on the hearing, and, if so, which parts of it will be admitted into evidence. I think that in these circumstances the time at which to address the question of the testing of the evidence in the first respondent's affidavit, both as to cross-examination of her and the requirement that she produce documents, is on the hearing of the motion for contempt. I do not think it an appropriate use of the notice to produce procedure, at least in the context of the first respondent's prima facie right to have it set aside, to require the first respondent to produce documents to be held by the Court pending ascertainment of what evidence, if any, in her affidavit, will form part of the evidence on the hearing of the contempt motion, and further pending a decision as to whether the applicants should be entitled to compel her to produce documents to assist them in testing that evidence. In the circumstances, it cannot be said at present that the applicants are entitled to production of the documents on the hearing "for the purpose of evidence"; cf O 33 r 12 (1). For the above reasons, in my opinion the notice to produce should be set aside. On the question of costs, however, it should be noted that today is the first occasion on which the solicitor for the first respondent has put a case for the setting aside of the notice to produce. I have recounted in some detail the sorry history of this matter earlier. Enough has been said to indicate the reasons why orders for costs have been made against the first respondent and I would not set aside those orders. In relation to the hearing over two periods of a quarter of an hour each two days ago, on Wednesday 7 October, in the first place the solicitor for the first respondent was late which meant that some small period of time was lost by counsel for the applicants - an appropriate reason to order the first respondent to pay the applicants' costs for that short period - but second, and in any event, at that time the first respondent was not moving to set aside the notice to produce. Turning to the position today, however, I think that Mr Adamson has put the substance of the reasons which have found favour with me for a setting aside of the notice to produce. Counsel for the applicants, whose submissions have been helpful and who has demonstrated admirable patience throughout, has suggested that costs should be reserved. But a distinct issue has been argued on the motion brought by the amended notice of motion filed yesterday, which is a self-contained proceeding, and I think Mr Adamson is entitled to his costs of today. Accordingly, the orders of the Court are that: (1) The notice to produce issued by the applicants to the first respondent dated 2 September 1998 be set aside; (2) The motion brought by notice of motion filed 1 October 1998 by the first respondent be dismissed with no order as to the costs of that motion; (3) The applicants pay the first respondent's costs of today only, on the motion brought by amended notice of motion filed by the first respondent on 8 October 1998; (4) Otherwise in relation to the costs on the motion referred to in order (3), there be no order as to costs to the intent that the parties to that motion bear their own respective costs of it. I certify that this and the preceding seven (7) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Lindgren