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[2011] NSWSC 980
Supreme Court of NSW
2011-08-26
Einstein J, Mr J
Original judgment source is linked above.
The application 1There is before the Court a notice of motion to set aside sundry subpoenas issued by the plaintiff to outside parties. Mr Stitt QC was briefed to argue that the subpoenas to Obeid Corporation and Streetsmart Infrastructure Group should be set aside. 2This is not the first time in these proceedings that the Court has been approached to set aside a subpoena. Similar applications were heard in April 2011, when the defendants filed a notice of motion to set aside a Commonwealth Bank of Australia subpoena. 3In that judgment, City of Sydney v Streetscape projects Australia [2011 NSW SC 364 ['The CBA judgment'], I set out the salient principles in some detail.
A short background 4Streetsmart is a wholly owned subsidiary of the first defendant in the proceedings, Streetscape Projects (Australia) Pty Ltd. Its sole director and shareholder is the second defendant in the proceedings, Moses Obeid. 5Obeid Corporation is a company of which Moses Obeid is a director.
Certain matters of principle 6In the CBA judgment, the Court noted at [10]: "I think the essential notion is that there is a reasonable chance that the material sought will assist the defence. If it is reasonable to infer that the material sought exists and that it is relevant to an issue, though its content is unknown, it will almost invariably be logically the case (as it seems to me) that such a chance exists, even though it might be thought to be unlikely. Seeking that material therefore seems to me to be a legitimate forensic purpose..." (emphasis added). 7In respect to documents called for by a subpoena, in the CBA Judgment at [25], I endorsed the following formulations of the test as being: (1)documents which have the capacity to "throw light on the issues in the main case": Trade Practices Commission v Arnotts Ltd (No 2) (1989) 88 ALR 90 at 103; (2)documents which could "reasonably be expected to throw some light on the issues in the proceedings": Re Marnotta and Secretary, Dept of Health and Ageing [2004] AATA 800 at [42]; and (3)documents may reasonably be regarded as "on the cards" if the documents will materially assist the resolution of the issues in the proceedings: Alister v R (1984) 154 CLR 404. 8Brereton J in Portal Software International Pty Ltd v Bodsworth [2005] NSWSC 1115 had occasion to revisit the matter. His Honour identified the test for relevance in the context of subpoenas or notices to produce as follows (at [23]-[25]): "It is necessary, then, to appreciate what is the test of "relevance" in the context of a subpoena. In many of the cases, it had been described as " apparent relevance", in the sense that the documents, production of which is sought, must bear some apparent relevance to an issue in the proceedings. In Waind v Hill , Moffitt P described the concept in these terms: Production of a document on subpoena by a stranger is only required if the document is sufficiently relevant to the action in the sense that it is likely to add in the end, in some way or other, to the relevant evidence in the case. In White v Tulloch (1995) 127 FLR 105; (1995) 19 Fam LR 696; (1995) FLC 92-640, the Full Court of the Family Court referred to the test in terms of documents having "a sufficient apparent connection to justify their production or inspection". But perhaps the most instructive description is that of Beaumont J in Arnotts , in which his Honour said that the test of adjectival relevance was satisfied if the material had apparent relevance and was established if the documentation called for "could possibly throw light on the issues in the main case". In a slightly different but related context, the test has been put in terms that a subpoena has a legitimate forensic purpose if it appears to be "on the cards" that the documents sought will materially assist the defence in a criminal proceeding [ Alister v R (1984) 154 CLR 404 at 414 (Gibbs CJ), R v Saleam (1989) 16 NSWLR 14 at 18]. Thus it is plainly not the question at this (first) stage whether the documents, production of which is sought, will definitely advance the case of the parties issuing the subpoena, nor whether they will be admissible in evidence at the trial. It is sufficient that they could "possibly throw light" on the issues in the substantive proceedings, or that it appears to be "on the cards" that they will do so. What are the issues in the proceedings will appear from the pleadings (where there are pleadings), the affidavits, and the legal principles, which govern the claims for relief in the substantive proceedings. Rolfe J, in his Honour's judgment of 31 July 1998, dealt with a number of subpoenas which had been issued and dealt with a number of notices of motion seeking to set aside those subpoenas. The judgment included a reasonably detailed examination of the authorities and of the principles involved. His Honour enunciated, in a fashion which I would not depart from, the basic parameters which are to inform the Court in the exercise of its discretion where an application to set aside a subpoena is pursued. On the one hand, there is clearly to be recognised, the obvious danger of permitting a party by use of the subpoena procedure, to investigate issues of credit having no conceivable relevance to issues pleaded, in the sense that to permit subpoenas of that type to be called would open up matters falling outside the legitimate field of enquiry raised by the issues in contest. On the other hand, it seems to me quite clear that inspection should be granted, so far as is necessary, in the proper conduct of the litigation, where the Court forms the view that the material falls within the legitimate field of enquiry raised by the issues in contest and is reasonably likely to add in the end in some way or other to the relevant evidence in the case. The exercise, recognised by Rolfe J, involves the need to balance these alternative considerations. The determination of the Court in the balancing exercise and in particular the proper approach to the question of relevance, requires the Court, as Rolfe J indicated, to bear in mind the entitlement of the parties to build up what his Honour referred to as 'an evidentiary mosaic'. As his Honour said, that exercise generally cannot be done, particularly in complicated commercial litigation, by the tender of one piece of evidence or the assertion that only limited material is relevant to the issues involved. As his Honour said, 'particularly is that so when one must have regard to the desirability of as full a cross-examination as possible, assisted by the availability of documents which will aid that'. Hence, as his Honour stated, both as to issues and as to the issue of credit, the Court should not be astute to find irrelevance at an early stage in the proceedings." 9It is not the case that a third party cannot be compelled to produce a document "unless the document is itself admissible in evidence upon proof by a witness other than the person requested to make it available (see Waind v Hill (1978) 1 NSWLR 372 at 380)." To the contrary, there is no requirement that the documents sought should be intended to be tendered in evidence, nor even that they be admissible: cf. Waind v Hill at 381. 10As such there is no need to identify the document with "sufficient specificity to allow the Court to make a decision that it is itself admissible". This passage was expressly rejected by Moffitt P (with whom Hutley and Glass JJA agreed) in Waind v Hill at 381.
Returning to the close consideration of the particular matters treated with by the respective parties on the current application
The plaintiff's concerns 11The plaintiff relied upon an affidavit sworn by Ms Fernandez on 26 August 2011. Relevantly her evidence included the following : (1)On 27 July 2011 the defendant served the city with further affidavit evidence from amongst others, Moses Obeid, Gerard Obeid, John Macleod and Daniel Joseph. The further affidavits and next documents that had not been discovered and which Ms Fernandez had not previously seen (2)One 31 July 2011 the plaintiffs wrote to the defendant's solicitors seeking a day to accept service of a subpoena to produce addressed to Gerard Obeid. (3)On 1 August 2011 the trial in the matter resumed (4)on 11 August 2011 the city issued a subpoena to Jarred Obeid returnable on 18 August 2011 (5)Also on 11 August 2011 the city sent a letter to the defendant solicitors seeking further and better discovery as to matters raised in the further affidavits. (6)On 12 August 2011 the city filed a notice of motion seeking orders that the defendants provide further and better discovery. (7)One 12 August 2011 the city filed a notice of motion seeking orders that the defendants provide further and better discovery. (8)The motion for further and better discovery was listed before the Court on Monday, 15 August 2011 (9)Shortly after the hearing of the motion for further and better discovery on the morning of 15 August 2011, the plaintiffs received a letter from the defendant solicitors in response to their letter. (10)At the hearing of the motion for further and better discovery, the defendants consented to an order that they give further and better discovery of all documents within the categories of documents set out in the plaintiff's earlier letter dated 11 August 2011. (11)No further documents were discovered in response pursuant to the Court orders of 15 August 2011 for further and better discovery (12)on 16 August 2011, the city received a letter from the defendants solicitors stating that further discoverable documents had been uncovered in storage facilities used by Obeid Corporation as a result of its efforts to respond to the Gerald Obeid subpoenaed. (13)On 17 August 2011, copies of the documents referred to in the 15 August 2011 letter were provided to the plaintiff's solicitors and reviewed by Ms Fernandez. The late discovery consisted of eight lever arch files. The late discovery included documents that were annexed to the further affidavits received on 27 July 2011 (14)further correspondence was sent by the faintest solicitors to the defendant solicitors and on 18 August 2011, documents were produced to the Court by Gerard Obeid in response of the Gerard Obeid subpoenaed. Must Fernandez reviewed copies of these documents. Included in the documents produced by Gerard Obeid were e-mails that had not been discovered by the defendants which were relevant to the defendants relationship with streetscape International (15)19 August 2011 the plaintiff's solicitors sent a letter to the defendant solicitors seeking an explanation as to why e-mails produced by Mr Gerard Obeid had not been discovered by the defendants. (16)Also on 19 August 2011 the plaintiff's solicitors sent a letter to the defendant solicitors seeking an explanation as to why it had taken them from 27 July 2011 up to 17 August 2011 to discover documents which had been included in the further affidavits. (17)On 22 August 2011 the back of solicitors received a letter from the defendant solicitors in response to the plaintiff's letter dated 17 August 2011. The plaintiffs have not received a response to their letters dated 19 August 2011.
Returning to the principles 12In relation to Rule 33.4 of the Uniform Civil Procedure Rules, Ritchies notes the following : The fundamental principle is that subpoenas should identify the documents sought to be produced with reasonable particularity. The text cites the decision of Wardell J in Spencer Motors (unreported November 25-December 9, 1982). Importantly at page 926 the judge dealt with a passage from Commissioner for Railways v Small in which Jordan CJ said : "Where the subpoena is addressed to a party, it is still necessary that it should state with reasonable particularity the documents which are to be produced... Even if the documents are specified, a subpoena to a party will be set aside as abusive if great numbers of documents called for and it appears that they are not sufficiently relevant" 13Before going further it is appropriate to note that Mr Stitt in his written submissions focused attention on the notion that both Obeid Corporation as well as Streetsmart Infastructure are properly described as strangers to the litigation. Whilst this may be true in a technical sense, the relevant subpoenas should be read against a background that Streetsmart is a wholly owned subsidiary of Streetscape Projects (the first defendant) and that Mr Obeid, (the second defendant), is the sole director of that company. Hence there is a relevant relationship between a party to these proceedings and the addressee of the subpoenas which is relevant to the question of oppression. 14I accept the plaintiff's proposition that in the present circumstances the documents which the plaintiff seeks simply ask for documents without imposing upon the addressee of the subpoena any decision-making process requiring them to make an assessment of the relevant issues in the proceedings.
The Obeid Corporation subpoena 15Mr Stitt took the following objections to the Obeid Corporation subpoena: (1)Paragraphs 1 to 16: It is common ground that the plaintiff has conceded in relation to paragraphs 1 to 16 of the Obeid Corporation subpoena that it is prepared to limit the period such that paragraphs 1 to 16 should be read as relating to the redefined period of 1 July 2001 to 30 September 2009; (2)Paragraph 17: There is a lack of precision in respect of this paragraph. What is sought are all documents evidencing or recording communications. The first and obvious objection to that is that it's unlimited as to topic. The period is confined, but the topic is not; and (3)Paragraph 21- Subsections (a) to (d) are objected to because they are not limited to time. It relates to all documents evidencing, recording or referring to communications with any person. So it's not limited as to identity and accordingly it could be any person in the world presumably. 16Mr Stitt concluded that if the following paragraphs are struck out, the plaintiffs should not be granted leave to file another subpoena. The subpoena was drafted with the supervision of experienced Counsel and the plaintiff should bear the consequences of having the subpoena struck out.
The Streetsmart Infrastructure subpoena 17Mr Stitt took the following objections to this subpoena: (1)Paragraphs 1 to 4: Mr Stitt took the same objection to paragraphs 1 to 4. He submitted that the documents were not identified with sufficient precision; and (2)Paragraphs 5-10, 15 and 17-22: No precision objection was taken, however Mr Stitt indicated that on his instructions the documents had already been produced and requiring them to be produced again would be oppressive;
The plaintiff's reply 18Mr Jucovic addressed his opponent's arguments in a number of overarching submissions. As to the submission concerning oppression, Mr Jucovic argued that his opponent's definition of precision was too broad and all that was required was "reasonable identification". In this context, the plaintiff's subpoenas are not imprecise. 19Mr Jucovic also relied on the notion that the documents identified in the subpoenas are not oppressive as they do not require the addressees to determine the relevance of the documents to the proceedings. In this sense, their broadness removes the oppression. 20As to Mr Stitt's submission concerning the double production of certain material, Mr Jucovic indicated that this bears no relevance to the question. The entities are separate and are not subject to the same discovery obligations. 21Mr Jucovic indicated that the motive behind certain parts of these subpoenas is to supplement what his side views as inadequate discovery. As evidence of this, the Court was taken to Ms Fernandez's affidavit.
Decision 22The Court makes the following orders in relation to the Obeid Corporation subpoena: (1)The term Period in paragraph 1 is to be redefined to mean the period from 1 July 2001 to 30 September 2009; (2)The challenges to paragraph 17 and 21(a)-(d) are rejected. 23In relation to the Streetsmart Infrastructure Group subpoena: (1)The wording after subparagraph (k) in paragraph 1 is to be amended to read "during the period 1 January 2005 to date limited to email communications to or from the following email addresses:"; (2)The challenges to paragraphs 2,3,4, 5-10, 15 and 17-22 are rejected. 24The parties are to bring in short minutes of order at which time they will be given an opportunity to address on costs.
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: 29 August 2011
The City of Sydney
Streetscape Projects
[2004] AATA 800
(1984) 154 CLR 404
(1989) 16 NSWLR 14
(1989) 88 ALR 90
(1978) 1 NSWLR 372
(1995) 127 FLR 105
(1995) 19 Fam LR 696