Farahbakht v Midas Australia Pty Ltd

LEGISLATION CITED : Supreme Court Rules 1970 (NSW), Pt 55, r 13

Athens v Randwick City Council (2005) 64 NSWLR 58; [2005] NSWCA 317 Attorney-General v Butterworth [1963] 1 QB 696 Brambles Holdings Ltd v Trade Practices Commission (No 2) (1980) 32 ALR 328, ATPR 40-179; 44 FLR 182 Bromilow v Phillips (1891) 40 WR 220; 36 Sol Jo 124; 8 TLR 168 Global Custodians Ltd v Mesh [2002] NSWSC 845 Freeman v The Queen (1985) 3 NSWLR 303 Kirkpatrick v Kotsis [2004] NSWSC 1248 Lane v Registrar of the Supreme Court of New South Wales (1981) 148 CLR 245 Lilter v Thompson (1839) 2 Bear 129 Meissner v The Queen (1995) 184 CLR 132 R v Kellett [1976] QB 372 CASES CITED : R v McLachlan [1998] 2 VR 55 R v Rogerson, Nowytarger & Paltos (1992) 174 CLR 268 R v Taylor [1999] 3 VR 657 R v Toney [1993] 2 All ER 409 Re B (an infant) [1965] Ch 1112 Re Johnson (1887) 20 QBD 68 Rowden v Universities Cooperative Association Limited (1881) 71 LT Jo 373 Shaw v Shaw (1861) 2 Sw & Tr 517; (1861) 164 ER 1097 The Registrar of the Supreme Court, Equity Division v McPherson [1980] 1 NSWLR 688 Watson v Collings (1944) 70 CLR 51 Wellby v Still (1892) 66 LT 523; 8 TLR 202 Witham v Holloway (1995) 183 CLR 525

PARTIES : Farid Farahbakht (plaintiff/respondent) Midas Australia Pty Limited (defendant/applicant)

COUNSEL : Mr G Sirtes (plaintiff/respondent) Mr B Shields (defendant/applicant)

SOLICITORS : Abbott Tout Lawyers(plaintiff/respondent) Deacons Lawyers (defendant/applicant)

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION DUTY LIST

5040/06 Farid Farahbakht v Midas Australia Pty Limited JUDGMENT (Ex Tempore) 1 HIS HONOUR: In the substantive proceedings the plaintiff Farid Farahbakht claims injunctive and declaratory relief in respect of the proposed termination by the defendant Midas Australia Pty limited of a franchise for the operation of a Midas shop and a licence to occupy the premises from which it is operated at West Ryde. By notice of motion filed on 5 October 2006, Midas alleges that Mr Farahbakht is guilty of contempt of court in that, on 3 October 2006, he did have a telephone conversation with Thomas Norman, the deponent of an affidavit sworn 30 September 2006 and filed in these proceedings, and say to him words to the effect of those set out in para 3 of the affidavit of Mr Norman sworn on 4 October 2006, with the intention of inducing Mr Norman to give false evidence or withhold evidence or not attend as a witness in these proceedings. Mr Farahbakht says that he is not guilty of the contempt charged. Background

2 Midas served a notice of breach and a notice of termination of the franchise agreement and the licence on 13 September 2006, to take effect from 27 September 2006. The ground on which Midas relied for terminating the franchise and the licence is the alleged fraudulent operation of the franchise by Mr Farahbakht, through under-declaring to Midas his sales, and through his failing to produce Midas computer-generated invoices to customers of the franchise. Mr Farahbakht disputed those allegations and sought an undertaking that Midas would not take steps to terminate the franchise or the licence in reliance on the notices, and he offered to submit to an audit. No such undertaking was forthcoming, and on 26 September 2006 Mr Farahbakht obtained leave of Gzell J to file a summons and motion which was returnable the following day, 27 September 2006.

3 On 27 September Gzell J made orders, by consent, standing over the hearing of Mr Farahbakht's application for interlocutory relief until 5 October 2006, directing that Midas serve any affidavits upon which it wished to rely by 4pm on 2 October, with Mr Farahbakht to serve any affidavits in reply by 4pm on 4 October, and noting an agreement between the parties providing for an extension of the notices of termination up to 5 October.

4 On 30 September 2006 Mr Norman swore an affidavit. He is currently employed as a store manager of a Midas outlet at Pymble, but was previously employed by Mr Farahbakht at West Ryde, having commenced his employment there on 4 April 2006 and having left on 23 August 2006. His evidence, if accepted, would serve to establish a course of dishonest and fraudulent dealing by Mr Farahbakht, involving the taking of cash from sales to customers and, as a result, the understatement of sales to Midas. His evidence would, on its face, be seriously injurious to Mr Farahbakht's case and inconsistent with his assertions of innocence of the alleged fraudulent conduct.

5 In his affidavit, Mr Norman deposed to a conversation which he says he had with Mr Farahbakht's wife on or about 27 August 2006, on Mr Norman's third day at the Pymble store, in the course of which reference was made to the suspicion that Midas had photographic evidence of Mr Farahbakht taking cash money, and the possibility was raised by Mr Norman that Mr and Mrs Farahbakht suspected that he was somehow responsible for Midas having been able to position a camera in the store. Mr Norman says that he asked, "What, do you think that I did it?", to which Mrs Farahbakht responded, "Midas is in big trouble and you will be in big trouble too", to which Mr Norman says he replied, "Hey, you got caught and you are going to need to cop it".

6 Mr Farahbakht says that on 20 September 2006 at about 3pm, he received a telephone call from Mr Norman, in which Mr Norman said, "Why take me down with you. It looks like you're going down. Don't take me down with you", to which Mr Farahbakht says he responded, "I don't know what you're talking about. I'm not going down. I'm not going anywhere. I will call you some other time".

7 Although Mr Norman's affidavit was sworn on 30 September 2006, there is no clear evidence as to when it was served. However, as I have mentioned, the directions made on 27 September 2006 provided for the service of the defendant's affidavits, of which Mr Norman's was one, by 4pm on 2 October 2006. According to Mr Farahbakht, he first obtained any knowledge of the existence of the affidavit at about 3pm on 3 October 2006, when he received a telephone call from his solicitor. He says that his solicitor called him between three and four o'clock on the afternoon of 3 October and, as a result of that telephone call, he was aware that the affidavit existed, but he did not possess an understanding of its contents. So far as can be ascertained from the evidence, it would seem that he knew that an affidavit was being forwarded to him by e-mail, but that he did not at that time open it and was not aware of its contents. He also says that at that stage, he was not even aware who was the deponent of the affidavit, and was completely unaware that Mr Norman had sworn an affidavit.

8 Although I accept, for reasons to which I will come, that Mr Farahbakht was not, prior to 4pm on the afternoon of 3 October, aware of the contents of the affidavit, I am unable to accept that he was unaware that Mr Norman was, at the very least, a potential witness, and indeed I am satisfied beyond reasonable doubt of the contrary, namely that he was aware, if not that Mr Norman had put his name to an affidavit, at least that there was a very real likelihood that he would be a witness in the case. I shall come to my reasons for that conclusion shortly. The 4 October conversation

9 According to Mr Norman's affidavit of 4 October 2006, at about 4pm on 3 October 2006, while working at Midas Pymble, he received a telephone call from Mr Farahbakht who said, "Tom, this is Farid from Midas West Ryde". Mr Norman said, "Yes". Mr Farahbakht said, "Are you going to court to testify against me?", to which Mr Norman says he responded, "I don't know. How do you know I'm going to court anyway?". Mr Farahbakht said, "Glen told me. What did you mean? Either you are going to court or you are not going to court". Mr Norman responded, "I don't know. I'm waiting for a phone call. Why does it matter to you anyway?". Mr Farahbakht said, "I wanted to know who my friends and enemies are". Mr Norman replied, "I don't know yet if I am going to court. I am expecting a call today". Mr Farahbakht said, "Are you going to go in there and say that you don't know nothing or are you going to tell them what happened?" Mr Norman responded, "You should not be calling me. I have to go". Mr Farahbakht said, "If you do say something it is going to hurt me and my family". Mr Norman replied, "Look, I have to go", and hung up the telephone. Mr Norman says that during the conversation Mr Farahbakht's tone was "menacing", and that he felt intimidated.

10 Mr Farahbakht gives a different version of the conversation. He says that he telephoned Mr Norman at around 4pm on 3 October with the intention of clarifying with him a credit note issue involving a supplier and a transfer back of goods - a tyre - for credit. He says that approximately a week prior to 3 October he had had a telephone conversation with his bookkeeper in which questions had been raised about the absence of a credit note from the supplier, and Mr Farahbakht said that he would find out about it - "There might be a credit note on the way".

11 Mr Farahbakht deposed that he opened the conversation with Mr Norman on 3 October as follows: "Hi Tom, it's Farid. How are you? Are you busy? Are you going to court or what?". Mr Norman replied, "Yes, yes. Why are you asking?" Mr Farahbakht said, "I'm just asking to see how you're going, if you're busy or not". Mr Farahbakht says Mr Norman replied, "I'm not going to tell you anything. I'm managing my store. I'm going to be managing my store on Thursday. I'm not telling you anything. I'm not taking anyone's side, you or Midas." Mr Farahbakht says he responded: I didn't say anything about any day. You were telling me about Thursday. Look, I'm not taking you to court - maybe Midas is. Looks like it. You are telling me something is happening on Thursday. I don't know. We'll see about it.

12 In his cross-examination, however, Mr Farahbakht sought to resile from the version to which he had deposed, that in opening that conversation, he said, "Are you going to court or what?", and said instead that the question of going to court was first raised later in the conversation by Mr Norman. The Contempt Application

13 On Thursday 5 October, which was the next court date and was the next "Thursday" after the conversation of 3 October, the matter was listed before Gzell J, who gave leave to file the motion for contempt and statement of charge and Mr Norman's affidavit of 4 October, and made orders by consent standing the matter over to 13 October, noting an agreement for the extension of the notices of termination in the meantime. On 13 October Hamilton J, by consent, stood the proceedings over to 30 October 2006, once again noting an agreement for the extension of the notices in the meantime. It was in those circumstances that the matter came before me as duty judge on 30 October 2006, when it was determined that the contempt application should be dealt with before any application for interlocutory relief was argued.

14 The contempt charge is one which involves an allegation of interference with the administration of justice. It is a criminal contempt and the criminal standard of proof which requires proof beyond reasonable doubt is applicable, although proceedings for contempt are not attended by all the procedural incidents of a criminal trial (Witham v Holloway (1995) 183 CLR 525; Kirkpatrick v Kotsis [2004] NSWSC 1248, [5]; Athens v Randwick City Council (2005) 64 NSWLR 58; [2005] NSWCA 317]. Findings as to the 4 October conversation

15 Notwithstanding that stringent standard of proof, I am satisfied beyond reasonable doubt that a conversation took place between Mr Farahbakht and Mr Norman on 3 October 2006, substantially in the terms deposed to by Mr Norman. I reach that conclusion for the following reasons, which also explain my acceptance that Mr Farahbakht had not read the affidavit, and my satisfaction beyond reasonable doubt that he knew that Mr Norman was a potential witness.

16 Mr Norman's version attributes to Mr Farahbakht the statement, "Are you going to go in there and say that you don't know nothing or are you going to tell them what happened?". If Mr Farahbakht had read Mr Norman's affidavit, he would have known exactly what Mr Norman was going to say, and that question would have been otiose. That statement is to my mind indicative of with his state of mind being knowledge that Mr Norman was likely to be saying something, but not knowing at that stage what it was that he was going to say.

17 Mr Farahbakht concedes the accuracy of parts of Mr Norman's version. In particular, he concedes that the conversation commenced to the effect, "Tom, this is Farid from Midas West Ryde." He also concedes that in the course of the conversation Mr Norman said, "I don't know. I'm waiting for a phone call. Why does it matter to you anyway?". That is an important concession, because such a statement on the part of Mr Norman really makes sense only in the context of the type of conversation deposed to by Mr Norman, rather than the version deposed to by Mr Farahbakht. It is a response to an enquiry about whether or not Mr Norman was going to court, and illustrative that there had been such an inquiry. Mr Farahbakht also concedes that Mr Norman said, "You shouldn't be calling me. I have to go". That again suggests that Mr Farahbakht was the moving party in the conversation.

18 Those parts of the conversation which Mr Farahbakht did not concede, and those parts which he appeared determined to deny, were largely the parts which would have attributed to him a pro-active role in raising the question of Mr Norman's intention to give evidence, and what that evidence might be. The circumstance that it is those parts of the conversation that he denies is implausible, in the context that Mr Farahbakht also says in his affidavit:- I wasn't aware, at the time of making the telephone call referred to ... above that I was not supposed to call any other witnesses involved in these court proceedings.

19 Next, the timing is highly significant. Some time between 3 and 4 pm on 3 October Mr Farahbakht was, accepting his own version, told by his solicitor that the solicitor was sending him a document which he needed to read and then discuss with the solicitor. Virtually immediately following receipt of that information from the solicitor, he telephoned Mr Norman. The suggestion which Mr Farahbakht advances for this call on 3 October - that it was a result of a telephone conversation with his bookkeeper on Sunday 24 September, more than a week earlier - when it followed not more than minutes after being told by his solicitor that there was a document (which happened to be Mr Norman's affidavit) for him to read, is improbable to a very high degree.

20 Next, on the face of Mr Farahbakht's affidavit, he opened the conversation with the statement, "Are you going to court or what?". I am entirely unconvinced by the attempt to resile from that evidence in the course of his cross-examination. His affidavit was prepared, no doubt with the benefit of the statement of charge and Mr Norman's supporting affidavit, knowing that he was facing a serious allegation of contempt, that the focus of that allegation was this very conversation, and that what was said about going to court in that conversation was at the very heart of the case. The inclusion of that statement in the affidavit cannot, in my view, be put to one side as an oversight in connection with some tangential matter. I do not see how there could have been a misunderstanding or misconception or error in that respect.

21 Finally, as well as its influence on the significance of the timing of the call, the supposed alternative reason for calling Mr Norman offered by Mr Farahbakht - to discuss the credit note - also does not sustain examination. Mr Farahbakht annexed to his affidavit a number of documents, at least two of them dated after 4 October, and it was only the last of them, a letter from the supplier dated 10 October, that contained or evidenced a refusal to provide a credit note. In the course of his oral evidence Mr Farahbakht, when asked what it was he wanted to ask Mr Norman about the credit note, said that the suppliers were denying the tyre had ever been returned for credit; it is not apparent that there was any such denial prior to 3 October 2006. In any event, the question of the credit note was not raised by Mr Farahbakht in the course of the conversation with Mr Norman; there appears to have been no attempt to raise it; and he appears to have been able thereafter to deal with the issue with the supplier, without any input from Mr Norman.

22 On the other hand, Mr Norman's recollection of the conversation was fresh when it was recorded in his affidavit within twenty-four hours of when it took place. I have not overlooked the circumstance that his recollection might be coloured by apprehension, particularly in light of the circumstance that Mr Norman has said elsewhere that he felt uncomfortable in the job at the West Ryde store from the outset, because of the "general environment", and that he felt threatened by at least one of the other employees. Moreover, in the role which Mr Norman had played, according to his affidavit, in contributing to Midas' knowledge of what it alleges against Mr Farahbakht, his level of apprehension might well have been increased. This has caused me to pause before accepting Mr Norman's evidence, but his version of the conversation contains no element of overstatement, and in his oral evidence, although it was short, nothing emerged to cast doubt on his version.

23 No single one of the matters which have influenced me to doubt Mr Farahbakht's version, on its own, would have persuaded me beyond reasonable doubt to reject it, but the combination of the matters to which I have referred, satisfy me beyond reasonable doubt that Mr Norman's version accords with what took place. Contempt by non-threatening approach to a witness

24 The question then is whether it constituted a contempt of court. As I have said, the contempt alleged is one of interference with a witness before or during a trial - in this case, before. Certain acts constitute a criminal contempt of court because they interfere with the due course of justice, either in a particular case or as a continuing process. One example of that kind of contempt is interfering with persons who have a duty to discharge in a court of justice [Re Johnson (1887) 20 QBD 68, 74]. Such persons include witnesses. As Lord Langdale MR said in Lilter v Thompson (1839) 2 Bear 129 (at 131):- If witnesses are ... deterred from coming forward in the aid of legal proceedings, it will be impossible that justice can be administered. It would be better that the doors of the courts of justice were at once closed.

25 Here we are concerned with interference with witnesses before trial. It is a contempt to intimidate, induce or deter witnesses in a manner calculated to deter them from giving evidence or to influence them in the evidence that they are to give, because that may prejudice the course of justice. The actus reus of such a contempt is an act calculated to interfere with the freedom of a witness's evidence [Rowden v Universities Cooperative Association Limited (1881) 71 LT Jo 373 (Kay J); see also Watson v Collings (1944) 70 CLR 51, 58; R v McLachlan [1998] 2 VR 55, 59].

26 So in Shaw v Shaw (1861) 2 Sw & Tr 517; (1861) 164 ER 1097 a wife had sued her husband for judicial separation on grounds of cruelty, many of the instances of which had been observed, so it was said, by a servant of Mrs Shaw. Prior to the hearing, the husband summoned the servant and during a bullying conversation threatened her with an action for perjury if she gave evidence against him. He was also found to have written an offensive letter to another key witness. In intimidating the witnesses for the purpose of preventing them from giving evidence, he was held to have committed a gross contempt.

27 A number of cases illustrate that this type of contempt can be committed without intimidation or threats. In Wellby v Still (1892) 66 LT 523; 8 TLR 202, the plaintiff's solicitor and his son wrote letters, to persons who were likely to be called as witnesses, which were not threatening in any way, but disparaged the defendants. Kekewich J had not the slightest doubt or hesitation that they amounted to a contempt, on the basis that though there had been no intimidation, there had been an endeavour to warp the minds of possible witnesses, which the court could not tolerate.

28 In Bromilow v Phillips (1891) 40 WR 220; 36 Sol Jo 124; 8 TLR 168, a witness who had made an affidavit on behalf of the defendant was approached by the plaintiff, accompanied by a police sergeant in uniform; in the presence of the policeman the plaintiff produced to the witness a copy of the witness's affidavit and demanded in a "threatening tone of voice" what he meant by certain statements contained in the affidavit, and alleged that the witness had sworn a false oath; there was also evidence that anonymous letters of a threatening nature, in the plaintiff's handwriting, had been recently received by the witness and by the defendant. The plaintiff did not appear to answer the charge and was committed for contempt.

29 In R v Toney [1993] 2 All ER 409, Mr Toney's brother was due to stand trial on a charge of robbery. Two days before the trial, Mr Toney called to see a potential witness in the trial, with whom Mr Toney had been in the same class at school, and told him that his brother had not been at the scene of the robbery and, as the witness departed declining to discuss the matter, said, "You're going to court to say you didn't see two people, one with a stocking mask over his head", to which the witness replied, "I did."

30 The Court of Appeal held that the offence of perverting the course of justice by interfering with a potential witness could be committed without evidence of any bribe, threat, undue pressure or other unlawful means, though it was usually easier to prove the actus reus of the offence - that is to say, the act tending to pervert the course of justice - and the necessary intention, or mens rea, if the means were unlawful. As Lloyd LJ, with whom Latham and Smith JJ agreed, said:- The gist of the offence lies in telling a potential witness what he should or should not say, with the intention of influencing his evidence, not in the means adopted.

31 His Lordship proceeded to explain that there were circumstances in which the means adopted could be relevant, in particular where the approach was made to the witness in order to persuade the witness to give what the approacher believed to be truthful evidence, rather than the contrary. As the judgment of Byrne J in R v McLachlan makes clear, for a person to use threats, pressure or inducement to persuade a witness to refrain from giving evidence which the approacher believes is false, may nonetheless be a contempt, if the means used are improper.

32 In this area of the law some considerable difficulty attends what constitutes the requisite mens rea. There are two views, each enunciated in Attorney-General v Butterworth [1963] 1 QB 696. Lord Denning MR (at 722-3) said that the requisite intent involved a purpose of deterring a witness from giving evidence or influencing the witness to give it in a sense different from that it would otherwise have taken. Donovan LJ said (at 726) that an intention to interfere with the proper administration of justice was not an essential ingredient of the offence, and it was enough if the action complained of was inherently likely so to interfere.

33 Those tests differ in the important respect that whereas, according to Lord Denning, in order to establish that an approach to a witness amounts to contempt, it must be shown that the alleged contemnor intended to influence the witness, according to Donovan LJ it could be sufficient to show that the approach itself was inherently likely to interfere with the witness's evidence [see Borrie and Lowe, Law of Contempt, London, Butterworths, 1996, 3rd edn, p 411]. The authors of that text favour the view expressed by Donovan LJ and point out that his Lordship's approach has been preferred in Australian cases, including Brambles Holdings Ltd v Trade Practices Commission (No 2) (1980) 32 ALR 328, ATPR 40-179; 44 FLR 182, 194; and by the Court of Appeal in this State in The Registrar of the Supreme Court, Equity Division v McPherson [1980] 1 NSWLR 688, 700, in Moffitt P and Hope JA said:- Upon the above being found, the intention or motive behind suppressing the document from the Court provides no excuse to negative the contempt otherwise established. This view is supported by what Donovan LJ said in Butterworth's case (2b). If Denning MR should be taken as deciding otherwise, with respect, the view of Donovan LJ is to be preferred. It accords with the view in McRae's case [a reference to the judgment of the High Court in John Fairfax & Sons Pty Limited v McRae (1955) 93 CLR 351].

34 That view of the law is also supported by the joint judgment of Gibbs CJ and Mason, Murphy, Wilson and Brennan JJ in Lane v Registrar of the Supreme Court of New South Wales (1981) 148 CLR 245, where their Honours said (at 285):- An intention to interfere with the administration of justice is not necessary to constitute contempt; the critical question is whether the act is likely to have that effect, but the intention with which the act was done is relevant and sometimes important. ( Attorney General v Butterworth [1963] 1 QB 696, 722-723; John Fairfax & Sons Pty Limited v McRae (1955) 93 CLR 351, 371.)

35 The manner in which their Honours cited Butterworth, with the primary reference to the judgment of Donovan LJ and the additional reference to that of Lord Denning, together with what their Honours said, indicates that their Honours were endorsing the view of Donovan LJ over that of Lord Denning in that respect.

36 There are decisions to the contrary. In R v Toney a summing-up was approved and endorsed by the Court of Appeal which included that the first (intentional) element to be satisfied was that the defendant had the necessary intention to pervert the course of justice. In Victoria, in R v Taylor [1999] 3 VR 657, Gobbo J, with reference to the judgment of Glass JA in McPherson, referred to the two different approaches by courts as to whether the question of intention was material to the offence of contempt, observing that the two different approaches descended from the Attorney-General v Butterworth. His Honour suggested that the approach endorsed by Donovan LJ was applicable in publication cases, but not otherwise, and concluded that, except in publication cases, a respondent must be shown to have had the intention to interfere with the course of justice. In another Victorian case, R v McLachlan, Byrne J summarised the relevant authorities, pointing to a statement of Street CJ in Freeman v The Queen (1985) 3 NSWLR 303 at 309, that the prosecution must establish to the criminal standard that the alleged contemnor had, at the relevant time, an intention to pervert the course of justice, but continued:- It is not necessary that the alleged contemnor have these concepts in mind at the relevant time; indeed, it would be surprising if this were the case: Meissner v The Queen (1995) 184 CLR 132 at 144. In that case the majority considered it sufficient that the alleged contemnor "intended to engage in conduct for a purpose that, in law, constitutes an actus reus of an attempt to pervert the course of justice": at 144.

37 Byrne J also referred to R v Taylor (above); to the direction of the Lord Chief Justice approved by the Court of Appeal in R v Kellett [1976] QB 372, 379-80, that it was sufficient that the relevant threat was made "with the intention of using those proceedings as a lever to stop the witness from giving evidence in court"; and to the statement of Mason CJ in R v Rogerson, Nowytarger & Paltos (1992) 174 CLR 268 at 278 that "The relevant intent was one to achieve the result which, in the circumstances of that case, amounted to the perversion of the course of justice alleged". Byrne J concluded that what must be proved was not an intention to do certain acts which were likely to tend to pervert the course of justice but to effect such a perversion, and that in a case such as the present, where the actus reus itself contained a mental element, it was not necessarily difficult to take the further step of finding mens rea.

38 In my view I am bound, particularly by the judgment of the Court of Appeal in McPherson, together with the statements by the High Court in Lane and the observations in Meissner and Rogerson, to adopt the view of Donovan LJ over that of Lord Denning so far as mens rea is concerned. It is, therefore, sufficient if I be satisfied that the acts of the alleged contemnor were intentional and were calculated to interfere with the course of justice. Was the 4 October conversation a contempt?

39 I have already explained that I have concluded that Mr Farahbakht knew that Mr Norman was a potential material witness: he knew it in any event from the role which Mr Norman had played in his business up to that time, and from the discussions which Mr Farahbakht had with him on 20 September, in which, on the versions of both witnesses, reference had been made to the possibility that, in the vernacular, "one might go down with the other"; and given the timing and the circumstances and the content of the 4 October telephone call, I am satisfied beyond reasonable doubt that he knew that it was very likely that Mr Norman was going to be a material witness in a couple of days' time, namely on Thursday 5 October.

40 Was the conversation an attempted interference with the witness in the relevant sense? Much of it is capable of innocent explanation. It is not a contempt to ring or approach or speak to a potential witness to ascertain what the witness is going to say, if called. There is no contempt involved in asking, "Are you going to court to testify against me?" Nor in my view is there necessarily any contempt involved in asking, "Are you going to go in there and say that you don't know nothing or are you going to tell them what happened?", at least unless accompanied by a suggestion, express or implicit, that the witness should do the former; such an inquiry simply seeks to elucidate what the witness is going to say and, in particular, whether the witness is going to tell what the enquirer, in the circumstances, fears will be disclosed if the truth is told, but might not be disclosed if nothing is said.

41 But it is when he goes on to say, "If you do say something, it is going to hurt me and my family" that in my view the line was definitely crossed. The statement, "If you do say something, it is going to hurt me and my family" can only have had as its purpose the raising of some, albeit perhaps slight, pressure, influence or encouragement not to tell the whole truth. At the very least, it was calculated to have that effect.

42 It is fundamental to the administration of justice that the willingness of witnesses to tell courts the truth be absolutely uninfluenced. The cases to which I have already referred show that the absence of a threat is irrelevant. Indeed, the administration of justice is prejudiced at least as much by the deterring or influencing of a witness from frankly telling the truth by affection, loyalty or concern about the impact of his or her evidence on a party, as by threats or bribery. In this case, by uttering those words, Mr Farahbakht gave a reason for Mr Norman either to decline to give evidence, or to give evidence in a way which would not hurt Mr Farahbakht and his family. In my view, that is a sufficient interference to constitute a contempt.

43 So far as mens rea is concerned, try as I might, I cannot think of any reason for uttering those words, other than to operate as some sort of deterrent to Mr Norman giving evidence and truthful evidence, unaffected and uninfluenced by other considerations. It must have come as a considerable blow to Mr Farahbakht's case to learn that Mr Norman was likely to be a witness against him, because it is implicit in the words used by Mr Farahbakht that he knew that Mr Norman's evidence had the potential to be highly injurious to his case. The only conceivable purpose of telling him that if he gave truthful evidence, it would hurt Mr Farahbakht and his family, could have been to provide a reason for not giving that evidence.

44 Accordingly, I am satisfied beyond reasonable doubt that Mr Farahbakht had the requisite intent. Indeed, I am satisfied that his intent was to influence the witness, albeit not to intimidate him, against giving truthful evidence, and in those circumstances, which of the views about mens rea is correct is immaterial, because that finding would satisfy the test enunciated by Lord Denning MR as well as that of Donovan LJ. Conclusion

45 Accordingly, I find the charge proved. I find the respondent guilty of contempt of court as charged.

Penalty 46 Supreme Court Rules 1970 (NSW), Pt 55, r 13, provide that the Court may punish contempt by committal to a correctional centre or fine or both. By sub-r (3):- The Court may make an order for punishment on terms, including a suspension of punishment or a suspension of punishment in case the contemnor gives security in such manner and in such sum as the Court may approve for good behaviour and performs the terms of the security.

47 In Re B (an infant) [1965] Ch 1112, Cross J said (at 1123):- The mere fact that no harm has been done in this particular case is neither here nor there. It would be unfortunate if the idea got abroad that if people threatened witnesses in this way, the worst that is likely to happen to them will be that they will have to pay some costs and make an apology.

48 In that case the contemnor was committed to prison for four weeks.

49 In Watson v Collings, Rich J observed that no court could allow to pass without observation an act calculated to affect the testimony of a witness or to embarrass him in giving evidence. That was in circumstances where the Minister for Railways had sent a communication to the Commissioner of Railways which appeared calculated to intimidate the Commissioner by drawing attention to the circumstance that his re-appointment was about to be reconsidered, and to the disadvantages of giving evidence in the case the Commonwealth proposed to present. However, his Honour thought that it was not necessary for the Court to move of its own motion to deal with the matter and that it could be left to be dealt with by the officers of the Crown, if considered appropriate.

50 Interference with witnesses and attempts to interfere with them cover a wide range. They extend from actual violence, through threats to life and limb, through bribes, to the more subtle influences referred to in some of the cases to which I have referred. There is also a distinction to be drawn between cases in which the attempt is to persuade the witness, albeit using improper means, to give evidence that the contemnor believes to be true or to refrain from giving false evidence, on the one hand, and those in which there is an attempt to dissuade a witness from revealing the truth on the other.

51 This case, so far as the means used were concerned, in many ways can be said to be at the bottom of the scale. There was no violence and no threat, and I am not satisfied that there was intentional intimidation. Although Mr Norman in his evidence referred to a "menacing tone", I have not found, beyond reasonable doubt, that a menacing tone was used; the conversation took place over the telephone, unaccompanied by the body language which might otherwise have given it colour, and Mr Norman was already nervous of his position, and was probably anticipating a menace.

52 However, I do not think that the insidious nature of blandishments and calls to affection and loyalty, as distinct from the gross nature of threats, bribes and violence, can be overlooked. More witnesses are probably deterred from or influenced against giving truthful evidence by affection for or loyalty to a party than by threat or intimidation. A deterrence from giving truthful evidence in those more subtle ways is just as much an interference with the course of justice as one attributable to the more gross methods that I have mentioned.

53 Notwithstanding that qualification, I do think that this contempt was at the bottom end of the relevant scale. A conversation which, initially, was a legitimate one, became contemptuous when Mr Farahbakht stepped over the line in the course of that conversation. I do not think it was premeditated - I am not satisfied that the conversation was initiated, at the outset, with a view to persuading the witness to refrain from giving or altering his evidence, as distinct from finding out what he was going to say. Rather, I think the contemptuous part of the conversation arose, more or less spontaneously, in the course of the conversation; at least I am not satisfied to the requisite standard of the contrary.

54 Mr Farahbakht tendered an apology to the court and to Mr Norman in his affidavit which was sworn and read while his guilt was still in issue, and that is a matter which has to be taken into account in his favour. On the subjective side, I also take into account that he is the parent of a child currently in year 12 and sitting the Higher School Certificate. I do not think that specific deterrence in Mr Farahbakht's personal case requires a custodial sentence. 55 The matter which has caused me the greatest difficulty is the question of general deterrence because, for reasons which I have explained, the insidious operation on witnesses of claims on their loyalty, affection or goodwill is just as detrimental to the administration of justice as the more overt interferences which these cases typically feature, and I suspect are far more frequent and ultimately far more detrimental in terms of quantity, to the administration of justice. That such dealings with witnesses are criminal contempts requires clear public enunciation by way of general deterrence. As was pointed out by Byrne J in R v McLachlan, the whole point is that in our adversarial system, evidence will often be called by one party which the other believes to be false, and the assessment of that evidence is a matter for the court, not for the other party.

56 R v McLachlan is not on all fours with this case: although the conduct of Mr McLachlan was much more gross than that of Mr Farahbakht, in that there was an overt threat to prosecute the witness for perjury, and, moreover, Mr McLachlan was a policeman who should have known better, nonetheless the seriousness of his conduct was mitigated to a considerable extent by the circumstance that he was endeavouring to dissuade a witness from giving evidence which he believed - and as Byrne J found, had reasonable grounds to believe - was false.

57 Notwithstanding those differences, Byrne J's conclusions - that the conduct of Mr McLachlan was not that of a vicious or vindictive man, but that of a naive and perhaps foolish one, who perhaps did not understand the full significance of what he was doing; that in those circumstances, his Honour would not proceed to convict Mr McLachlan, as the ordeal that he had undergone would be a sufficient disincentive to any repetition on his part; and the fact that the contempt proceeding had been brought, and brought successfully, would act as a deterrent for others who may be minded to act as he did - are instructive.

58 As I have said, there is not exact equivalence with this case, but there is a substantial equivalence and, in my view, a similar, though not identical, outcome is warranted, moreso given Mr Farahbakht's apology. I do not propose to make an order for committal. In view of his apology, I think the matter will sufficiently be met if I order that he pay the applicant's costs of the contempt proceedings on an indemnity basis [cf Global Custodians Ltd v Mesh [2002] NSWSC 845, [37]].

59 My order is that the respondent/plaintiff pay the applicant's costs of the motion filed on 5 October 2006 on an indemnity basis. I direct that those costs may be assessed forthwith. **********

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.