Choundary v Capital Airport Group Pty Ltd

Charge 1 - Interference with the administration of justice 20 The Federal Magistrate found that: (1) It was necessary for the appellant to prove that the respondent intended to interfere with the administration of justice in any deletion or destruction of the email box. (2) There was no direct evidence of the respondent's intention. (3) There was no direct evidence that the email mailbox had been destroyed or deleted. (4) He 'could not be satisfied beyond reasonable doubt that the respondent intended to interfere with the administration of justice'. Any finding of intention would be so speculative that it would not be beyond reasonable doubt. 21 It is submitted in this appeal that the Federal Magistrate erred in his approach to the question by coming to his own decision as to whether the charge was proved beyond reasonable doubt, rather than considering whether that conclusion could be reached. Whilst there are some indications of that approach, the Federal Magistrate referred to the proper test and used the word 'could', which is consistent with the correct test. I would not uphold that submission in relation to this charge. 22 There was debate both on this appeal and at the original hearing concerning the place of intent in relation to this charge. Reference was made to R v Rogerson (1991) 174 CLR 268; Meissner v The Queen (1994) 184 CLR 132; Lane v The Registrar of the Supreme Court of New South Wales (Equity Division) (1981) 148 CLR 245; Hatty v Pilkinton (No 2) (1992) 35 FCR 433; and R v McLachlan [1998] 2 VR 55. In my opinion, it is not necessary to get deeply involved in fine distinctions to resolve this case. Counsel for the appellant accepted that it was necessary to prove that the respondent had intentionally destroyed the appellant's email box knowing that to do so would have the tendency to interfere in the administration of justice. Counsel's summary of the elements to be established was as follows: '(a) the Respondent knew proceedings were imminent; (b) after the Respondent became aware that proceedings were imminent it destroyed the Appellant's email mailbox; (c) that the destruction of the email mailbox was intentional; (d) that the destruction of the email mailbox interfered with the administration of justice; (d) the respondent knew the destruction of the Appellant's email box was likely to have that tendency.' If intent to interfere with justice were an element and if those elements were established then intent could easily be inferred. The elements themselves of course can be established by making inferences from primary facts. 23 This is a circumstantial case. The Federal Magistrate was required to take into account all inferences most favourable to the appellant, which could reasonably be drawn from the primary facts (see the decision of the Privy Council in Haw Tua Tau v Public Prosecutor [1982] AC 136 at 150). In my opinion, it would not be possible, on the primary facts, to exclude the hypothesis that any destruction of the emails that took place was the result of actions by persons with no knowledge of the proceedings or potential proceedings or was a result of a procedure which did not take account of those proceedings. It is quite possible that a system could have existed which provided for the destruction of emails at fixed times during the year, at a particular length of time after an employee has left or as directed by some person in the administration or technology areas to suit the convenience of administration. In other words, any destruction may have been the result of a routine procedure. There is no inference available from the primary facts that would exclude that hypothesis unless there is speculation as to the circumstances of the alleged destruction. 24 Counsel for the appellant referred to the evidence of Mr Ferraro that it was not usual commercial practice to delete a former employee's email mailbox if that employee had played an important role in the organisation. Even if that evidence were admissible, it would not say anything about the commercial practices of this respondent and would not assist in denying the hypotheses to which I have referred. 25 This analysis is a symptom of what appears to me to be an underlying problem, namely, that the party charged with interfering with the course of justice is a corporation with a number of employees carrying out a number of functions. The principles according to which a corporation can be guilty of contempt of court by interfering with the course of justice were not a topic raised below and only surfaced during the course of argument on this appeal. Even if a corporation can be guilty of such a charge, it is not legitimate to aggregate the knowledge of individuals and attribute the aggregated knowledge to the corporation (R v AC Hatrick Chemicals Pty Ltd (1995) 152 A Crim R 384 at 394; cf, in a different context, Krakowski v Eurolynx Properties Ltd (1995) 183 CLR 563 at 582-583). In the present case, it is not possible to know who deleted the emails (that is if they were deleted) or on whose instructions the emails were deleted. That being the case, it is not possible to attribute to those persons the knowledge held by others within the organisation as to the actual or potential litigation. The relevant knowledge as to the litigation would have to be held by the representative of the corporation who was also responsible for the deletion. Further, that person would need to be the directing mind of the corporation for guilt of such a charge - in effect, a common law offence requiring mens rea - being attributed to the company (Tesco Supermarkets Ltd v Nattrass [1972] AC 153). The evidence in this case simply does not permit any such finding to be made. 26 The other two charges are different in nature as they involve alleged breaches of orders (cf Australasian Meat Industry Employees' Union and Others v Mudginberri Station Proprietary Limited (1986) 161 CLR 98).

charge 3 - Compliance with subpoena 27 The subpoena in question was issued on 12 February 2004 directing the respondent to produce the documents on 26 February 2004 in the form described in paragraph [11] of these reasons. The full email chain containing six separate emails dated 4 December 2001 was not produced, although two of those six emails were produced. 28 The Federal Magistrate found that there was no prima facie case for the respondent to answer as the subpoena called for material from the server, not from the back-up tapes. He said that there was no evidence that the email chain in question was on the respondent's server at the relevant time. He was not prepared to infer that the full email chain was still on the server in February 2004. 29 Counsel for the appellant submits that, as two emails from the chain were produced in response to the subpoena taking into account Mr Ferraro's evidence that the two emails only ever existed as part of the chain and never in isolation in electronic form, there was an inference available that all of the emails were on the server at the relevant time. 30 The respondent supports the reasoning of the Federal Magistrate. It submits that there was no direct or indirect evidence that the relevant emails were on the respondent's server at the time of service of the subpoena. The fact that the full chain may have been on a back-up tape did not establish its presence on the server. 31 For the purposes of this charge I view the facts somewhat differently from the Federal Magistrate. It can be taken that all of the emails were on the server originally. There is no evidence which compels the conclusion that they were deleted prior to the service of the subpoena. The existence of a back-up tape does not establish that the emails had been deleted from the server. Thus, on a view of the evidence most favourable to the appellant on this charge, there was a prima facie case of failure to produce the email chain in accordance with the requirements of the subpoena. 32 I have a further fundamental difficulty with the respondent's position. The subpoena called for communications which were maintained by the respondent's server at the earlier nominated period of time, not communications maintained at the time of the service of the subpoena. If, for example, hard copies were kept of emails which were maintained on the server at the earlier time, they should have been produced. Similarly, back-up tapes containing those emails should also have been produced. If the evidence of Mr Ferraro at its highest is taken into account, the fact that two emails out of a chain were produced shows that there was access to the chain of emails at the relevant time. 33 In my opinion, on either basis there was a prima facie case and the appeal must be upheld to that extent. That makes it unnecessary to consider whether the Federal Magistrate impermissibly found facts in disposing of this charge.

Charge 4 - Discovery order 34 On 1 July 2004 Driver FM made the following orders for discovery: '… 2. On or before 15 July 2004 the respondent shall discover: (a) all e-mails to and from the applicant for the period 1 November 2000 to 28 February 2002; (b) all e-mails to and from Mr Stephen Byron concerning the applicants [sic] for the period 1 November 2000 to 28 February 2002; (c) all e-mails to and from Ms Leesa Baker concerning the applicant for the period 1 November 20090 to 28 February 2002. 3. For the purposes of rule 14.03 of the Federal Magistrates Court Rules 2001 (Cth) the respondent's affidavit of discovery shall distinguish between documents previously produced on subpoena and documents not previously produced.' 35 There appear to have been two reasons why the Federal Magistrate rejected the existence of a prima facie case. The first was that he could not be satisfied beyond reasonable doubt that the respondent held the chain of emails elsewhere in its possession apart from the back-up tape of 9 January 2003. He said: 'There is no direct evidence and I am not prepared to draw the necessary inferences from the evidence.' That appears to be a finding of fact, or a refusal to find a fact, rather than considering inferences which would be open on a view of the evidence favourable to the case of the appellant. Furthermore, it is not consistent with the view I have expressed with regard to the second charge relating to the non-compliance with the subpoena. 36 Even on that finding it was necessary to deal with the absence of the 9 January 2003 back-up tape from the affidavit of documents. It will be recalled that the affidavit was to be provided in July 2004. The appellant's solicitor gave evidence that she had received a telephone call from the respondent's solicitor on 20 September 2004 saying that his client had found the 9 January 2003 back-up tape and said that she had no reason to disbelieve him. The Federal Magistrate said: 'The clear implication is that the tape was only recently found.' He was not satisfied beyond a reasonable doubt on the evidence that the back-up tape was in the possession, custody and control of the respondent in July 2004 and had not been lost or misplaced. 37 In my opinion, the evidence of the appellant's solicitor could not be utilised in that fashion in deciding whether or not there was a prima facie case. The tribunal of fact would not be obliged to accept the hearsay statement of the respondent's solicitor, even if it was admissible, and the question as to whether or not the appellant's solicitor had any reason to disbelieve it is irrelevant to the issue. In effect, the Federal Magistrate found a version of the facts favourable to the respondent without any proper basis for doing so. 38 In my opinion, there is a prima facie case that the email chain was available either on the back-up tape or the server or both at the time the affidavit of discovery was sworn and filed. The appeal must be allowed on that account also.

General 39 Having found no prima facie case on any charge, the Federal Magistrate went on to remark upon failings to distinctly and clearly state the charges and with regard to the general handling of the matter. No particular failing was identified. I see no difficulty with the framing of the third and fourth charges, and I can see no procedural defect that would have justified dismissal of the charges on that account alone. 40 I gather from what was said by the respondent's counsel that the ruling in question was not the result of an application by the respondent, but followed from the learned Federal Magistrate's reading of r 19.02(7) of the Federal Magistrates Court Rules which provides that, after hearing evidence in support of the allegation, the Court may, if it decides there is no prima facie case, dismiss the application. The effect of the rule in question was not argued before me. I am concerned if it requires the Court to rule as to whether there is a prima facie case of its own motion and regardless of the position of the respondent. A respondent with a simple explanation may prefer to fight the merits and so avoid interlocutory appeals. For all I know that may be the case here.

Conclusion 41 The appeal is upheld in part. The order of the Federal Magistrates Court dismissing the proceeding is set aside. In lieu thereof it will be ordered that the proceeding be remitted to the Federal Magistrates Court for hearing in relation to charges 3 and 4. The respondent should pay two-thirds of the costs of this appeal to reflect the failure of the appellant on one of the charges. The costs of the proceedings below should await the result of that proceeding. Any application that can be made pursuant to the Federal Proceedings (Costs) Act 1981 (Cth) can be made to me in Chambers. I certify that the preceding forty-one (41) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gyles.

Associate: Dated: 15 December 2006 Counsel for the Appellant: Ms R Francois

Solicitor for the Appellant: Nicholas Dibb Solicitors

Counsel for the Respondent: Mr S Gageler SC, Ms K Eastman

Solicitor for the Respondent: Mallesons Stephen Jaques