Prentice v Cummins

RULING ON EVIDENCE 1 The applicants ("the Trustees"), the trustees of the bankrupt estate of John Daniel Cummins ("the Bankrupt"), have tendered two documents as business records, pursuant to s 69 of the Evidence Act 1995 (Cth) ("Evidence Act"). The first is a letter dated 29 October 2001 from a Business Development Officer of an entity described on the letterhead as Suncorp Metway, addressed to the Australian Taxation Office ("ATO") ("the Letter"). The second is a document, apparently enclosed with the letter, headed "Statement of Assets and Liabilities" ("the Statement"). 2 I was informed from the bar table, without objection, that the Letter and its enclosures, were produced by the ATO to the Trustees' solicitors in response to a notice issued by the Trustees pursuant to s 77A(1) of the Bankruptcy Act 1966 (Cth). It is clear from the terms of the Letter that Suncorp Metway, which appears to be a bank, was asked by the ATO to provide information concerning a loan by it to the second respondent ("Mrs Cummins"), the wife of the Bankrupt. In response to the ATO's request, Suncorp Metway, under cover of the Letter, supplied loan statements for the period of the loans and a copy of the Statement. The Letter states that "[t]here was no formal application form submitted by the client, which was apparently the normal practice for Suncorp Finance Ltd Commercial Loans at that time". 3 The Statement is a printed form which is completed in handwriting, but is unsigned and undated. The printed form has the words "MEDICAL & COMMERCIAL FINANCE CORPORATION LIMITED" near the top. The form purports to record the assets and liabilities of Mrs Cummins. Among the assets attributed to Mrs Cummins the following is recorded "HOUSE AT HUNTER (sic) HILL (1/2) share - 1,000,000". It is common ground that the handwriting on the document is not that of Mrs Cummins. 4 One of the issues in the case is whether, as Mrs Cummins claims, the Bankrupt, prior to executing a transfer to Mrs Cummins of his registered interest as joint tenant in the matrimonial home at Hunters Hill, held that interest in trust for Mrs Cummins or whether, as the Trustees claim, he held his interest beneficially. The Trustees wish to rely on the assertion in the Statement that Mrs Cummins' interest in the matrimonial home was limited to a half share only. (It is common ground that Mrs Cummins held her interest as joint tenant beneficially.) 5 Section 69 of the Evidence Act provides as follows: "(1) This section applies to a document that: (a) either: (i) is or forms part of the records belonging to or kept by a person, body or organisation in the course of, or for the purposes of, a business; or (ii) at any time was or formed part of such a record; and (b) contains a previous representation made or recorded in the document in the course of, or for the purposes of, the business. (2) The hearsay rule does not apply to the document (so far as it contains the representation) if the representation was made: (a) by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact; or (b) on the basis of information directly or indirectly supplied by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact. …". A "previous representation" is defined in the Dictionary to the Evidence Act to mean a representation made otherwise than in the course of giving evidence in the proceeding in which evidence of the representations is sought to be adduced. 6 Section 183 of the Evidence Act provides that, if a question arises about the application of a provision of the Act to a document, the Court may examine the document and "draw any reasonable inferences from it as well as from other matters from which inferences may properly be drawn". 7 In order to satisfy the requirements of s 69 of the Evidence Act, the Trustees must show that (i) the Statement is or forms part of the records belonging to or kept by a body in the course of or for the purposes of a business; or that the Statement at any time was or formed part of such a record; (ii) the document contains a "previous representation" made in the course of, or for the purposes of, the business; and (iii) the representation was made (relevantly) on the basis of information directly or indirectly supplied by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact. 8 The Statement, although produced to the Trustees by the ATO, was part of a file kept by Suncorp Metway. Mr Coles QC, who appeared with Mr Newlinds for the Trustees, did not submit, however, that the Statement was a business record of Suncorp Metway. Presumably he refrained from making this submission because he accepted that any representation contained in the Statement was not made in the course of or for the purposes of Suncorp Metway's business. This approach is consistent with the view taken under the repealed Part IIIA of the Evidence Act 1905 (Cth) ("Evidence Act 1905"), that the mere fact that a document prepared by A is contained in the files of B does not make it a business record of B: Trade Practices Commission v TNT Management Pty Ltd (1984) 56 ALR 647, at 659, per Franki J; Karmot Auto Spares Pty Ltd v Dominelli Ford (Hurstville) Pty Ltd (1992) 35 FCR 560, at 564-565, per Heerey J. 9 Mr Coles submitted that the correct approach was to regard the Statement as a business record of Medical & Commercial Finance Corporation Ltd ("Medical Finance Corporation"). He invited me to infer that the Statement contained a representation recorded in the document for the purposes of the business conducted by Medical Finance Corporation: that is, for the purposes of its business of assisting clients to obtain finance for business ventures. Mr Coles also invited me to infer that the representation concerning Mrs Cummins' interest in the Hunters Hill property was made on the basis of information provided by her. He further submitted that the Statement, although not forming part of the records kept by Medical Finance Corporation at the time the document was produced, had at some time formed part of such a record. 10 The first difficulty facing this submission is that there is nothing to indicate that the Statement ever formed part of the records of Medical Finance Corporation. The copy of the Statement was produced by the ATO, from a file that had been supplied to it by Suncorp Metway. There is no evidence that the original of the unsigned Statement, or a copy, was ever kept by Medical Finance Corporation. In Karmot Auto Spares v Dominelli Ford, Heerey J observed, with reference to Part IIIA of the Evidence Act 1905, that a particular document could not have been part of the business records of a firm because (at 565) "[i]t had passed out of the possession and control of that firm. I think that the ordinary sense of 'business record' connotes a repository of information in organised form which is accessible in the usual course of and for the purposes of that business to those who contact it". 11 The construction of s 69 of the Evidence Act is not, of course, governed by the interpretation accorded to the repealed provisions of earlier legislation. But s 69(1)(a) of the Evidence Act expressly contemplates that the document tendered at one time must have formed part of the records belonging to or kept by a body for the purposes of a business. The unsigned Statement in the present case (so I would infer) was supplied by a third person to Metway Suncorp. Even if it be assumed that the third person was a representative of Medical Finance Corporation, there is nothing to indicate that the Statement or any copy thereof ever formed part of that company's records. The position might be different if the tender was of a copy of the Statement kept in the files of Medical Finance Corporation: cf Compafina Bank v Australia & New Zealand Banking Group Ltd [1982] 1 NSWLR 409. 12 The second obstacle to admitting the Statement, so far as it contains the representation relied on by the Trustees, is that I am not prepared to draw the inferences necessary to establish the conditions for admissibility. There was no evidence as to the business, if any, conducted by Medical Finance Corporation, nor as to the relationship, if any, between Mrs Cummins and that company. The Statement contains the printed name of Medical Finance Corporation but contains no information (other than the name itself) as to its business. The form is not signed or dated, despite there being a printed declaration and a space for a signature and date. There is nothing to indicate who filled out the form and, in particular, whether it was an officer or an employee of Medical Finance Corporation. The handwritten notations do not identify the source or sources of the information contained in the Statement. Nor does the file supplied by Suncorp Metway to the ATO contain any documentation indicating that it relied on the information contained in the Statement to make a loan to Mrs Cummins. Since the file appears to be incomplete, the unsigned Statement may have been superseded by a more complete document prepared in connection with Mrs Cummins' application for finance. 13 I am not prepared to infer from the Statement itself that the representation concerning the Hunters Hill property was recorded in the document in the course of or for the purpose of the business, if any, conducted by Medical Finance Corporation. The mere fact that the company's name appears on the form is not sufficient to support an inference that the document was prepared by an officer or employee of Medical Finance Corporation for the purposes of a business such as mortgage broker or financier. Nor am I prepared to infer that the representation in the unsigned document was prepared on the basis of information directly or indirectly supplied by Mrs Cummins. It is true that the document contains some information personal to Mrs Cummins, but that information and the assertion that she held a half interest in the matrimonial home might well have been derived from sources other than Mrs Cummins herself. In particular, the assertion relating to the matrimonial home could have been derived from title documents, which would have shown Mrs Cummins and the Bankrupt to be joint tenants. 14 It follows that I am not prepared to find that the conditions specified in s 69(1)(b) and s 69(2) of the Evidence Act are satisfied. 15 For the reasons I have given the tender must be rejected. It is not necessary to deal with Mr Brereton's alternative submission that I should reject the tender in the exercise of the discretion conferred by s 135 of the Evidence Act. I certify that the preceding fifteen (15) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice SACKVILLE.