HER HONOUR: In this matter, by summons filed on 15 February 2021, the plaintiff (Steven James) seeks a release pursuant to r 21.7 of the Uniform Civil Procedure Rules 2005 (NSW) from the implied Harman undertaking (so-called after the decision in Harman v Secretary of State for the Home Department [1983] 1 AC 280) in respect of documents obtained under subpoena in two previous proceedings (to which I refer below). Neither of the defendants (the first defendant, Gordon A Salier, in his capacity as administrator of the estate of the late Clair Elizabeth James, and the second defendant, Shabnam Amirbeaggi, as trustee of the bankrupt estate of Jennifer Elizabeth James) opposed the application.
The matter came before me in the applications list on 23 March 2021 and it was agreed by the plaintiff's counsel that the matter could be dealt with on the papers. These are my reasons for the grant of the relief that is sought by the plaintiff.
[2]
Background
The following background is drawn from the material in support of the present application (relevantly, the plaintiff's affidavit sworn 15 February 2021 and Exhibit SRJ-5 thereto) and involves no findings as to any disputed questions of fact. The dispute is in essence a dispute between members of the James family. In these reasons, I will refer to the family members by their first names, without intending any disrespect.
The plaintiff (Steven) is one of four children of the late Clair James and the late Geoffrey Charles James. His siblings are Geoffrey Reginald James (Geoffrey), Peter Charles James (Peter) and Jennifer Elizabeth James (Jennifer).
On 24 August 1991, by a general power of attorney, Steven appointed his parents as his attorneys. His father died in June 2003, leaving his mother (Clair) as the sole attorney. Steven contends that during the period from 16 June 2003 to 16 June 2009, Clair (assisted by Jennifer) managed his business, including opening bank accounts in his name without his knowledge.
Clair died in March 2014, leaving a Will naming Jennifer as executor and under which each of her children was named as a beneficiary. Jennifer obtained a grant of probate in respect of Clair's Will on 1 December 2015.
In 2015, the other three siblings commenced proceedings (2015/108812) against Jennifer, seeking to have Jennifer removed as executor and alleging that she had breached her fiduciary duties to the estate by dealing with the property of the estate for her own benefit (the 2015 Proceeding).
In the course of the 2015 Proceeding, documents were produced on subpoena by various entities (Encompass Credit Union, St George Bank and HCF Life Limited).
On 5 April 2016, orders were made requiring Jennifer to provide accounts and removing her as executor of Clair's estate. Mr Salier was appointed as trustee of the estate. Steven's evidence is that Jennifer has not complied with the order to provide accounts (Steven's affidavit sworn 15 February 2021 at [18]).
In 2017, Steven commenced proceedings against Jennifer (2017/158633), alleging that, in managing Steven's assets, Jennifer breached fiduciary duties owed to Steven (the 2017 Proceeding).
In the course of the 2017 Proceeding, documents were again produced on subpoena by various entities (this time, Bendigo and Australia Bank Ltd, St George Bank, Commonwealth Securities Ltd (Commonwealth Securities) and Australia and New Zealand Banking Group Limited).
After Jennifer became bankrupt on 29 November 2017, and the second defendant, Ms Amirbeaggi was appointed trustee of her bankrupt estate, the 2017 Proceeding was discontinued.
On 27 February 2018, Steven lodged a proof of debt in Jennifer's bankruptcy claiming about the same amount that he had claimed against Jennifer in the 2017 Proceeding. The trustee in bankruptcy has sought evidence in support of the proof of debt.
On 15 May 2018, Jennifer's three siblings (including Steven) lodged a proof of debt in Jennifer's bankruptcy for the amounts said to be owed by Jennifer to Clair's estate as a result of the alleged dealing by Jennifer with funds in breach of her fiduciary duties as executor.
On 20 November 2020, Steven commenced further proceedings (2020/00330699) against Mr Salier, as administrator of Clair's estate, alleging breach of fiduciary duty and unconscionable conduct on the part of Clair and seeking orders for an account and that the estate pay equitable compensation (the 2020 Proceeding).
In the present application, Steven seeks to be released from the implied Harman undertaking by which he is otherwise bound in respect of the use of the documents obtained on subpoena in the 2015 and 2017 Proceedings, namely, bank statements relating to accounts held by Clair, Jennifer, Steven and by Steven and Jennifer jointly, as well as a summary of transactions undertaken on a brokerage account held by Steven and documents recording transactions relating to life insurance bonds held by Clair.
The purpose for which Steven seeks such a release is so that he is able to use the documents as evidence in the 2020 Proceeding against Clair's estate and as evidence to substantiate the proofs of debt lodged by him and on behalf of the estate in Jennifer's bankruptcy.
As noted above, there is no opposition to the application by Mr Salier or Ms Amirbeaggi. Nor is there any opposition by any of the entities which produced the documents on subpoena other than Commonwealth Securities (to which I will refer in due course).
[3]
Determination
The principles applicable on an application for a release of the Harman undertaking have been considered in a number of authorities and do not need here to be repeated. I considered them, among other cases, in Findex Group Ltd v iiNet Ltd [2019] NSWSC 1198 and most recently in Vickers v Commonwealth of Australia [2020] NSWSC 1762 (at [19]-[26]). Counsel for Steven took no issue with that most recent summary of the relevant principles, referring also in this context to the recognition of the competing considerations of public interest and the interests of justice in Minister for Education v Bailey (2000) 23 WAR 149.
The particular factors identified in Springfield Nominees Pty Ltd v Bridgelands Securities Ltd (1992) 38 FCR 217 (Springfield Nominees) and endorsed in Liberty Funding Pty Ltd v Phoenix Capital Ltd (2005) 218 ALR 283; [2005] FCAFC 3 as factors relevant to be taken into account when considering whether special circumstances are made out for the release from the Harman undertaking are (as set out in Springfield Nominees at 225):
… the nature of the document, the circumstances under which it came into existence, the attitude of the author of the document and any prejudice the author may sustain, whether the document pre-existed litigation or was created for that purpose and therefore expected to enter the public domain, the nature of the information in the document (in particular whether it contains personal data or commercially sensitive information), the circumstances in which the document came into the hands of the applicant for leave and, perhaps most important of all, the likely contribution of the document to achieving justice in the second proceeding.
Further, the assessment of special circumstances must be undertaken in relation to the specific documents in respect of which the release is sought (see Gavan v FSS Trustee Corporation [2019] NSWSC 667 at [125]; and Australian Securities and Investments Commission v Marshall Bell Hawkins Ltd [2003] FCA 833 per Merkel J at [12]-[13]). In that regard, on the present application, Steven has identified with specificity the documents for which the release from the Harman undertaking is sought (see prayer 1 of the summons filed on 15 February 2021).
Turning then to the particular factors relevant to the assessment of special circumstances, I make the following observations.
First, as to the nature of the documents in question, the documents are records of financial transactions undertaken by the respective siblings and the estate.
Second, as to the circumstances in which the documents came into existence, they are documents which on their face came into existence in the ordinary course of business of the respective financial institutions.
Third, as to the attitude of the author(s) of the documents, as adverted to above, none of the subpoenaed institutions has raised objection to the application other than Commonwealth Securities, which did not indicate any basis for its opposition but simply advised the plaintiff's solicitors by email that "…based on internal advice we are unfortunately unable to agree to the use of documents previously supplied under [the 2017 Proceeding] for these new proceedings" and requested that a new subpoena be submitted in relation to the new proceeding (see affidavit sworn 22 March 2021 by the plaintiff's solicitor, Madeleine Joye Reid at Annexure T).
It might be that there was a concern by Commonwealth Securities that provision of consent to the use of the subpoenaed documents would be inconsistent with the Harman undertaking (though it is clear from the request that was made to it that Steven was seeking release from the Court in respect of that undertaking) but in any event Commonwealth Securities was asked to advise if it wished to be heard in open court on the hearing of the summons and it did not indicate that it did. Therefore, I proceed on the basis that while the reason for its opposition is not clear, it has not indicated any prejudice that it would suffer if a release from the Harman undertaking were to be given in respect of the documents it previously produced (and indeed it seems to have had no opposition to production of documents pursuant to a new subpoena were one to be issued). In any event, Steven points out that all the documents produced by Commonwealth Securities relate to accounts in Steven's name and hence there can be no unwarranted intrusion into his privacy in circumstances where he wishes to use them for the purposes to which I have already referred.
Fourth, as to the prejudice that the author(s) of the documents might sustain were leave for the use of the documents to be granted, it is difficult to see any such prejudice since the documents simply record financial transactions in the ordinary course of business of its customers and were produced on compulsion so no question of breach of confidentiality could sensibly arise.
Fifth, as to whether the documents pre-existed litigation or were created for that purpose (and were therefore expected to enter the public domain), it is clear that these documents were created prior to the litigation and not for the purpose of the litigation. It is accepted by Steven that it would not have been contemplated at the time of their creation that the documents would enter into the public domain (although I interpose to note that I would have expected it to have been well understood by most financial institutions that documents of this kind might at some stage become relevant to court proceedings and if so would be liable to be the subject of some form of compulsory process of disclosure in such a context).
Sixth, as to the nature of the information in the document (in particular, whether it contains personal data or commercially sensitive information), Steven notes that the information in the documents is in the nature of particulars of personal financial transactions and includes information such as: the date of the transaction; the account on which the transaction was made; the amount of funds paid or received; the recipient of the funds; the source of the funds received; the method by which the transaction was effected; and reference numbers in relation to the transaction. Steven submits that the information is not commercially sensitive.
Insofar as the primary purpose of implying such an undertaking has been said to be to protect the subject party's privacy (British American Tobacco Australia Services Ltd v Cowell (representing the Estate of McCabe (deceased)) (No 2) (2003) 8 VR 571 at [20]), Steven says that, to the extent that the documents relate to Clair's affairs, her interest in privacy should be given less, if any, weight now that she is deceased; to the extent that the documents relate to his own affairs, this consideration is inapplicable (since he wishes to use the documents); and, to the extent that there are (four) documents which related to accounts held exclusively by Jennifer, it is said that releasing Steven from the implied undertaking in relation to those documents would be a relatively minor infringement of Jennifer's privacy and is outweighed by the other factors referred to in this application (and by the fact that Jennifer has not complied with the order for an account). Those four documents are transaction lists in relation to an ANZ bank account covering the period from 21 October 2004 to 20 January 2006 (see the affidavit sworn by Steven on 15 February 2021, Ex SRJ-5 at 598-602) and Steven notes that thereafter the same account was held in the names of both himself and Jennifer.
Next, as to the circumstances in which the documents came into the hands of the applicant for leave, that has already been explained - the documents were obtained on subpoena in the ordinary course of the respective proceedings in which those subpoenas were issued. Furthermore, it cannot be said that this is a case where a party has fortuitously obtained documents in one proceeding seeking opportunistically to use those documents in another proceeding. The purpose for which Steven seeks to use the documents is the same purpose, in effect, as that for which they were obtained in the first place.
Finally, this being the factor regarded in Springfield Nominees as the most important of all, as to the likely contribution of the documents to achieving justice in the proceeding in which (or for the purpose for which) they are now sought to be used, Steven submits that the documents are likely to make a significant contribution in the 2020 Proceeding against the estate and in accurately ascertaining the quantum of his, and the estate's, claims against Jennifer's bankrupt estate. This is said to be because the records will allow for an adjudication to be made as to which specific transactions (if any) were effected in breach of the relevant duties owed by the estate or by Jennifer. It is said that, without recourse to the documents, Steven will be incapable of proving that any particular disputed transaction was improperly undertaken. Steven submits that it is in the interest of justice that he be provided with the means to prove how the relevant funds were applied.
Further, Steven submits that the fact that Jennifer has not complied with the order to provide an account is a factor in favour of finding special circumstances because, if he is unable to use the documents as proposed, he is "effectively hamstrung" in his ability to ascertain the extent of his entitlements as a beneficiary of the estate.
Finally, it is noted that, although Steven is the account holder in respect of some of the documents, many of the relevant transactions occurred more than seven years ago. Steven says that many of the documents would no longer be retained and therefore that he will now be unable to obtain those documents directly from the relevant financial institutions.
In my opinion, balancing all the above, and taking into account the statutory mandate for the just, quick and cheap resolution of the real issues in dispute (which makes it undesirable to require a fresh subpoena to be issued for the very same documents - even assuming that all those documents have been retained by the financial institutions after the elapse of time since the documents were initially produced), I am satisfied that special circumstances have been shown to warrant a release from the implied Harman undertaking in respect of the identified documents in order to enable their use for the purposes to which Steven has deposed.
[4]
Orders
For those reasons, I make the following orders:
1. Order that, in respect of the documents identified in prayer 1 of the summons filed on 15 February 2021, the plaintiff be released from the implied undertaking that those documents only be used for the purposes for which they were disclosed, such that the plaintiff is permitted to use the said documents for the purposes set out at [36] of the affidavit sworn 15 February 2021 by the plaintiff.
2. Order that there be no order as to costs.
The above orders will therefore dispose of the summons in its entirety and the Court file in this proceeding will be closed.
[5]
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Decision last updated: 26 March 2021