This is an application by the defendants for an order that the, an authorised officer of the Manly-Warringah Sea Eagles Limited ("the producing party") attend Court for the purpose of examination in relation to the company's compliance with a subpoena. The subpoena was first served on 22 March 2016 and later, in an amended form correcting the name of the producing party and refining the schedule, on 28 April 2016 (see annexure H to the affidavit of Mr Hoy which is exhibit A in these proceedings).
The background to this application is set out in the affidavit of Mr Hoy which contains a number of annexures, as supplemented by correspondence email sent to the producing party on 7 September 2016 warning of the application in question.
I first note the absence of the producing party. The producing party was called outside the Court three times at 10.55am, but there was no appearance. In response to an earlier email advising that this application would be brought before me today, and inviting the producing party to consent to an adjournment for the purpose of answering the subpoena, the producing party's response was a one-sentence answer that:
"The subpoena should be dismissed." (Exhibit A p 86)
Their response to an email advising this application was listed this morning and providing Mr Hoy's affidavit was as follows:
"My only comment is that we have a paperless office and I don't want a hard copy of the attached material." (Exhibit B)
The first question is whether I should proceed in the absence of the producing party. There is no set rule as to what should happen if a party (or, where a subpoena is called upon, a producing party) fails to appear on an interlocutory application. While there are provisions set out for hearings such as those set out in r 29.7 Uniform Civil Procedure Rules 2005 (NSW) ("UCPR"), they are not applicable to a failure to comply with production of material (UCPR rr 33.6, 33.12 and 42.7).
The obligation of a party who proceeds in the absence of an opponent is helpfully summarised by Barrett J in Satz v ACN 069 808 957 Pty Ltd [2010] NSWSC 356. I formally note that Ms Barnett, in my view, has complied with those obligations. In addition, as the judge hearing this application, I have certain obligations to the absent party and, in accordance with the relevant principles, I have put questions to Ms Barnett about a number of issues, such as the degree of notice that the producing party has and the producing party's knowledge of the applications before the Court.
I note that this is not a case where the absent party is under a disability, or is self-represented. At all relevant times the correspondence between the parties has been conducted by a solicitor. The producing party is an experienced commercial organisation. Ultimately, as Barrett J notes in Satz v ACN 069 808 957 Pty Ltd, the conduct of proceedings in our legal system is adversarial in nature and the responsibility for conduct of proceedings, including the production of documents, lies with the party concerned.
The correspondence after the subpoena was served on the producing party on 22 March 2016 is set out in the affidavit of Mr Hoy. I am satisfied that this resulted in the revised subpoena being served on 28 April 2016 (see p 59 of Mr Hoy's affidavit). When production of those documents was sought, this gave rise to an answer dated 6 May 2016 as follows:
"It is apparent that the subpoena seeks documents related to the ASADA inquiry generally, without reference to Hibbert. Without prejudice to [the producing party's] right to object to the width of the subpoena in relation to the categories referred in the table I attach:
1. A notice from the NRL dated 1 March 2013 and
2. My reply to the NRL dated 12 March 2013.
I trust that provision of these documents avoids having to argue about the width of the subpoena.
I note that the NRL engaged a lawyer to interrogate MWSE's IT system. [The producing party] does not know what if anything Deloitte provided to the NRL pursuant to that interrogation."
There then appears a table of requests and the producing party's answers, which I will not set out in full, but which contains the following assertions:
"(a) As to categories 1 and 2, it is asserted that neither the plaintiff nor Mr Dank was retained by the producing party.
(b) The objection to category 3 is that this category is too broad (a similar objection is taken in relation to para 11 and 12 but with an important rider discussed below).
(c) It is asserted there are no documents in relation to categories 4 to 10.
(d) The objection to categories 11 and 12 is 'this is too broad'. If the category is limited to Hibbert, there are none."
Leaving aside the complaint that Ms Barnett makes (that the documents in question were produced to her instructing solicitors and not to the Court, which means that the plaintiff is shut out from knowing about those documents), this schedule demonstrates two features. First of all, the producing party does in fact have documents, whether or not they produce them to the Court. Secondly, it is clear from the terms of this correspondence and the correspondence that follows that they have considerably more documents than the two which they informally produce.
These answers also fall short in terms of dealing with the documents sought. The categories set out in the subpoena, which I will not set out here, go well beyond referring to documents referring to "Hibbert". They refer also to such items as material concerning supplements, board meetings referring to these issues, and the like. Mrs Barnett submits, and I accept, that, in her words, it "defies belief" that, when facing an ASADA investigation, these issues were not discussed at the producing party's board meetings, in circumstances in which Mr Dank and the provision of supplements to the players were not only matters of notoriety but also of internal investigation.
On 30 May 2016, the solicitors for the defendant, Ashurst, sent a letter in response to the issues raised by the producing party. This letter stated that the defendants' solicitors were surprised to hear that there were no documents concerning employment, since Mr Dank had recently given evidence in open court on oath that between 2004 and 2010 he held the position of sports scientist with the club. It went on to state that the understanding of the defendants was that both Mr Dank and the plaintiff were involved with the club and had regular contact with the players for the period 2005 to 2013. Ashurst asked the producing party to specify the capacity in which Mr Dank and Mr Hibbert were "involved" with the club if they were not either employed or retained (I note that the relevant transcript extracts referred to by Ashurst have also been provided to me, and that they have given a correct summary of Mr Dank's evidence). There was also a challenge to the complaint of broadness of the categories which, in my view, is soundly based as well as an expression of surprise that there are no documents in relation to items 7 to 10.
Ashurst's letter also refers, in relation to items 11 and 12 in the schedule, to Mr Hibbert's nickname. It was widely reported (one of the newspapers referring to this is attached) that Mr Hibbert was often referred to by a nickname, "The Gazelle", as well as being Mr Dank's "assistant" (Exhibit A, p 75). This appears to be acknowledged, to a degree, by Unsworth Legal, in their letter of 30 May 2016, in which they make the following somewhat disingenuous reply:
"Paragraphs 3 to 12
I am not going to comment on your speculation in paragraphs 3 to 12. I repeat what I said in my letter dated 6 May 2016.
My client's objection is not on the basis of the range of substances identified. In relation to paragraphs 11 and 13 of the subpoena specifically, my client maintains the position that to the extent your request is limited to documents referring to Hibbert, they do not hold any such documents. If your client issues a subpoena referring to certain nicknames and can establish that those nicknames refer to Hibbert, my client would have to consider its position.
As the proceedings are limited to action [sic] concerning Hibbert, any documents that do not refer to Hibbert cannot be relevant at the proceedings and my client objects to this category of documents.
To the extent that my client's position in relation to width of the subpoena may have been misapprehended, I invite you to withdraw the subpoena or to not press those sections of the subpoena.
I confirm that my client presses its objections to the above paragraphs of the subpoena."
Mrs Barnett submits, and I agree, that this letter is imposing a level of exquisite refinement of the subpoena process which is unacceptable. It is not simply a matter of taking the very narrow reading that if a document does not refer to "Hibbert" it is not necessary to produce it. Mrs Barnett submits that the producing party has effectively "given the game away" by hinting at the fact that there are documents which refer to Mr Hibbert by a nickname and requiring the defendants to identify that nickname and prove it is Mr Hibbert's. However, if they know that Mr Hibbert is referred to, then those documents must be produced.
In effect the producing party would be well aware that Mr Hibbert using the nickname "The Gazelle" because, as I have already noted, it appears at paragraph 15 of the statement of claim which was served on them as part of the material provided, namely the statement of claim (at p 21ff of Mr Hoy's affidavit) and the defence.
It was subsequent to this that the solicitors for the defendants wrote on 26 July 2016 setting out the contents of a number of documents which establish that, contrary to the claims of the producing party in their correspondence with the defendants, they had acknowledged that Mr Dank was employed and had also acknowledged Mr Hibbert's role. I note in particular the following summary of this material (p 85 of Mr Hoy's affidavit):
"Finally, your client's response of May 2016 appears to us to be incomplete and in several respects incorrect based on information available to our client as set out in our letter of 13 May 2016 together with the following matters.
Your client by a press release of 6 February 2013 stated:
(a) The Manly-Warringah Sea Eagles employed Stephen Dank in an official capacity as a consultant between 2006 and 2010.
This is inconsistent with your client's assertion of 6 May 2016 that, "Dank was not engaged or retained by [the producing party]".
(b) In February 2016 the former CEO of your client publicly stated that:
"Mr Dank's contract was not renewed at the end of 2010."
This is also inconsistent with your client's assertion.
(c) In March 2008 Mr Hibbert in a series of emails with Mr Daniel Eichner, the ASADA Chief Scientific Officer, claimed to be involved in the preparation of the MWSE team; and
(d) On or about 28 April 2016 the former head coach of MWSE team in 2008 stated:
"[Mr Hibbert] was bringing a vitamin or supplement to one of the players that was allergic to the general stuff.""
That letter concluded with a request pressing for the production of the material sought under the subpoena. It was in response to the reminder letter of 26 July that the producing party's solicitors, Unsworth Legal, sent their one-line response, "no, the subpoena should be dismissed".
I note, for the sake of completeness, that Mr Hoy also attaches an article from The Australian dated 29 April 2016 headed, "Manly supplement provider Darren Hibbert claims he spiked drinks". This relates to the plaintiff's alleged provision of a drug called ITPP which had been banned by the World Anti-Doping Agency. It goes on to state that Manly players did not know they were given this drug and adds that the Manly Chief Executive (who joined the club after 2011 season) said he was unaware of these allegations, and it goes on to cite statements by Manly Chief Executive Graham Lowe that the plaintiff's claims were "rubbish". The article also contains statements by the former ASADA Chief Executive that the allegations were "serious". The Australian referred to a tax invoice showing Manly to have received three kilograms of the illegal drug mix on 10 September 2011, just before the club's successful finals campaign and grand victory against the New Zealand Warriors.
In a subsequent article, a Mr Toovey denied these claims on behalf of the producing party and a copy of an article from the Fox Sports News to this effect is set out in Mr Hoy's affidavit.
However, the fact remains that these reports and transcripts indicate that there are documents in the position of the producing party which have not been produced. Not only have they responded to Ashurst in terms which are not merely unhelpful but impolite, but they have not seen it necessary to attend Court or to bring an application to set aside the subpoena.
The relevant principles of law may be summarised as follows. The authority generally cited is Trade Practices Commission v Arnotts Limited (1989) 88 ALR 90 and the principles drawn from it are set out by Slattery J in Iacullo v Remly Pty Ltd [2010] NSWSC 980 at [6]ff. I note that his Honour refers to what was then a comparative novelty of use of s 56 Civil Procedure Act 2005 (NSW) to direct the production of information as well as the more traditional test set out in Commissioner for Railways v Small (1938) 38 SR (NSW) 564 and O'Born v Commissioner for Government Transport (1960) 77 WN (NSW) 81.
A particularly helpful statement of the law is as stated by Brereton J in Hexiva Pty Ltd v Lederer [2006] NSWSC 561 at [12]ff. As Slattery J did in Iacullo v Remly Pty Ltd, I endorse and adopt those principles, which are as follows:
"[12] Of course, failure to comply with a subpoena for production is a contempt of court and may be dealt with as such: Uniform Civil Procedure Rules 2005 (NSW), r 33.12. Independently of dealing with a non-compliance with a subpoena as a contempt, the court may compel compliance by an arrest warrant pursuant to Civil Procedure Act 2005 (NSW), s 97(1)(ii). At least at this stage, neither of those applications is made in this case.
[13] Civil Procedure Act, s 68, provides that subject to rules of the court, the court may, by subpoena or otherwise, order any person to, inter alia, attend court to be examined as a witness.
[14] The law relating to the procedure to be followed when a party who has issued and served a subpoena for production wishes to test the sufficiency of compliance with that subpoena was discussed by Beaumont J in Trade Practices Commission v Arnotts Ltd (No 2) (1989) 21 FCR 306. His Honour referred to what had been written by Moffitt J in H H Glass, Seminars on Evidence (1970) (at 10-11). Moffitt J, in that extrajudicial writing, observed that there seemed no reason why the court should not have a discretion to ask of a person, who was required to produce documents on subpoena, questions to ascertain the sufficiency of compliance, either informally or on oath. He continued:
In exercising such a discretion, the court would not infringe the privilege of a person not to incriminate himself, having regard to the fact that deliberate non-compliance with a subpoena is a contempt of court with penal consequences … Any such discretion could not extend as far as conducting a discovery process … The precise limits of questions of a person subpoenaed to produce documents are debatable, but it seems that a judge could ask and possibly permit to be asked, questions informally or on oath to ensure that the party understood the terms of the subpoena and the documents referred to and his obligation thereunder, including his obligation regarding documents in his possession or power and relating to search … It would seem, however, that questions could not extend to establishing proof that the person was in contempt of court, nor could they be of the search and inquiry type such as to the person's knowledge as to the location of documents not in his present possession or control, or as to the nature of other documents in his possession not within the scope of the subpoena, or as to his system of books or the like, so that this material could be used to search for other evidence or to enable a different subpoena to be framed.
[15] In Arnotts, Beaumont J concluded that, an issue having arisen as to whether or not documents of the type called for by the subpoena in question existed, the appropriate method to be adopted for the determination of that adjectival issue was a matter of judicial discretion. His Honour concluded that the appropriate course in that case was that the witness who had been subpoenaed to produce documents should be sworn, not in the substantive proceedings but in the ancillary application for production of documents pursuant to the subpoena; that that witness should then be examined by counsel for the party calling on the subpoena (implicitly in chief, by non-leading questions, albeit that the witness was the proper officer of Mattingly, the opposing party in the litigation); that counsel for the party with whom the witness was aligned might then also examine the witness; and that those directions were without prejudice to any claim for privilege against self-incrimination which might be made in the course of the examination and also without prejudice to any claim of confidentiality, and on the basis that none of the evidence so given was to be evidence in the principal proceedings or in proceedings in which it might be alleged that there had been a failure to comply with the subpoena. In that way, his Honour sought to preserve a fair balance between permitting Arnotts, who had issued the subpoena, to pursue their inquiries as to the existence of the documents sought, without depriving Mattingly, on the other hand, of its rights to claim privilege in a proper case. His Honour observed that Arnotts may not be able to pursue their inquiries exhaustively, but, on the other hand, Mattingly would have to make out a proper foundation for any claim for privilege.
[16] It is worth observing at this stage that Arnotts was a case in which, when a paragraph of a subpoena for production served on Mattingly was called on, Mattingly's officer proper answered that there were no documents to produce in answer to that paragraph of the subpoena. It was not a case in which there had been some production."
As to the relevant factors to take into account, I note:
1. This is not a case where the producing party has made a significant attempt to comply in that, apart from sending two documents informally, there has effectively been no production. A document for which legal professional privilege is claimed has been lodged in the registry this morning, but no other documents have been lodged with the court.
2. There has been no application to set the subpoena aside or for determination of the legal professional privilege issue of the one document produced.
3. There has been a great deal of correspondence, much of which, in my view, should not have been necessary, over a period of six months. Clearly, further correspondence will not resolve the issue.
The defendants submit they have reasonable cause for wishing to test the sufficiency of the producing party's compliance with the subpoena for production. I note the factors listed above, the absence of the producing party, the manifestly inadequate nature of their answer to correspondence and what appears to be the almost certain likelihood that they have documents which fall within the scope of the subpoena.
While there is a claim for privilege in relation to one document, a matter considered relevant by Brereton J in Hexiva Pty Ltd v Lederer at [24], that is an issue which can be determined when access is sought, and I do not propose to decline as a matter of discretion merely because one document (or perhaps more) may be the subject of a claim for privilege.
Unlike Hexiva Pty Ltd v Lederer (at [25]), this is not a marginal case. This is a very clear case where the interests of justice dictate that the defendants should have the opportunity to examine an authorised officer of the producing party in relation to his or her understanding of the obligations in respect of the defendants' subpoena.
Any issue of costs can be reserved and dealt with after the examination takes place. Such an issue should not play any part in my determination of these matters today.
As to the extent of the examination of the authorised officer, I propose to leave that in the hands of the defendants. The sort of topics that they may consider asking questions about (and I note that this part of my judgment is provided for the benefit of the producing party) may include some or all of the matters set out in Brereton J's decision in Hexiva Pty Ltd v Lederer at [26].
Accordingly, I propose to make the orders sought. The defendants have ordered the transcript and a copy of my judgment will be provided to the producing party by the Court.
I propose to set down a date of Thursday 6 October 2016 but if this date is for some reason not convenient to the producing party, it may be changed by agreement with solicitors for the defendant who I am sure, given their reasonable conduct of these proceedings to date, will be able to accommodate any such request.
The remaining order I make is that I reserve the costs of this application.
[2]
Orders
1. Manly-Warringah Sea Eagles Limited called outside Court 13D three times at 10:55am - No appearance.
2. An order that an authorised officer of Manly-Warringah Sea Eagles Limited ("the producing party") attend court on Thursday 6 October 2016 for the purpose of examination in relation to the producing party's compliance with the defendants' subpoena issued 28 April 2016.
3. Matter stood over to the Defamation List on Thursday 6 October 2016.
4. Costs of this application reserved.
5. Liberty to apply.
[3]
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.
Decision last updated: 09 September 2016