Tropic Asphalts Pty Ltd v Snowy Monaro Regional Council

The factual and litigious circumstances

1. On 13 January 2015 the Council granted development consent to the appellant, Tropic Asphalts Pty Ltd ("Tropic"), to operate a temporary mobile asphalt batching plant at Rock Flat for the purpose of supplying asphalt to RMS for roadwork it was to undertake nearby.
2. The consent was subject to conditions, imposed for environmental and traffic reasons, that plant production "not exceed 150 tonnes per day at any time during operations" (Condition 4) and that "[t]he number of trucks accessing and/or exiting the site is not to exceed twelve (12) per day at any one time" (Condition 6). The work was completed and the mobile asphalt batching plant was removed by the middle of May 2015.
3. On 3 February 2015 Mr Mark Adams, the Council Planning Manager at the Cooma Branch, attended the site of Tropic's plant and had a conversation with a man named "Alan" who described himself as Tropic's Plant Manager. "Alan" gave Mr Adams information concerning Tropic's daily tonnages and daily truckloads in supplying asphalt to RMS that suggested that numerous breaches of Conditions 4 and 6 of the development consent had occurred.
4. In response to a request from the Council, Mr Adrian Walsh, RMS's Works Manager, Traffic and Asphalt, sent an email to the Council on 11 February 2015 providing information as to tonnages of material supplied by Tropic to RMS in the period from 21 January to 6 February 2015.
5. In May 2015 the Council sought access under the Government Information (Public Access) Act 2009 (NSW) (the "GIPA Act") to documents held by RMS referable to Tropic's supply of asphalt to it. As a result of representations by Tropic to RMS only a limited number of documents, with financial and business information redacted, were made available to the Council.
6. On 3 September 2015 the Council served on RMS a notice under the then operative s 119J of the Environmental Planning and Assessment Act 1979 (NSW) (the "EPA Act") (now s 9.22) requiring production to the Council of records referable to compliance by Tropic with Conditions 4 and 6 of the development consent. The documents sought included contracts between RMS and Tropic, delivery records and records of conversations in relation to the delivery of asphalt by Tropic to RMS. On 1 December 2015 the Council also served a s 119J notice on Tropic.
7. By letter of 16 December 2015 to the Council, Tropic's solicitors contended that the s 119J notice issued to it was beyond power and therefore a nullity. It was then unaware of the notice issued to RMS but presumably would have advanced the same arguments in relation to that notice if it had been aware of it. In response, the Council's solicitors argued the contrary but by their letter of 6 January 2016 Tropic's solicitors maintained their stance.
8. On 19 December 2016 the Council commenced against Tropic in the LEC the substantive proceedings which have given rise to the present application for leave to appeal. As commenced, the proceedings charged under s 125(1) of the EPA Act contraventions by Tropic of s 76A(1)(b) comprising, relevantly, breaches of Conditions 4 and 6 of the development consent between 20 January and 8 March 2015.
9. On 23 December 2016 the subpoena the subject of the present application was issued by the LEC at the request of the Council. It required the production of any contracts between Tropic and RMS concerning the subject work, "quantity agreement sheets" (being business documents of a type identified by Mr Walsh in an affidavit of 31 October 2016) and delivery dockets attached to such quantity agreement sheets, in each case relating to the period from 20 January 2015 to 18 March 2015.
10. On 25 August 2017, Moore J found, on Tropic's application, that the Council's charges were in part defective for duplicity but that leave to amend might be able to be given ([2017] NSWLEC 109). An appeal by way of stated case was rejected by this Court ([2018] NSWCCA 202). On 27 November 2019, Moore J found that only limited leave to amend should be granted, with the result that the Council was confined to alleging that there was a breach of Conditions 4 and 6 on only a single day in respect of each condition ([2019] NSWLEC 182). Appeals by both parties to this Court were dismissed ([2020] NSWCCA 74).
11. Whilst these issues concerning the Council's charges were determined in the LEC and on appeal, Tropic's application, which it had made in a notice of motion filed on 1 February 2017, for the subpoena issued on 23 December 2016 to be set aside or for the Council to be denied access to documents produced under it, stood undetermined. Following a hearing on 25 June and 2 July 2020, with supplemental written submissions being filed on 8 and 10 September 2020, Moore J delivered judgment on 16 September 2020 refusing that application ([2020] NSWLEC 136).

The primary judgment of 16 September 2020

1. Moore J identified the bases of Tropic's contention that the subpoena was an abuse of process, and should therefore be set aside, by reference to Tropic's written submissions, which were relevantly to the following effect: 1. The subpoena was not issued for any legitimate forensic purpose because, as the Council's evidence established, the documents sought under it had already been produced to the Council under the s 119J notice which was "wider and more extensive" in its terms than the subpoena. It was not therefore "on the cards" that RMS would produce "any new or additional material" under the subpoena. 2. The subpoena was thus "not issued for the bona fide purpose of obtaining relevant evidence", instead it was produced "as a fall-back or 'insurance policy' for the prosecutor in the event that the documents produced by RMS in response to the purported s 119J notice were held at the trial to be unlawfully or improperly obtained and therefore inadmissible (per s 138 of the Evidence Act 1995)".
2. After considering the 25 February 2019 decision of this Court in Port Macquarie-Hastings Council v Mansfield [2019] NSWCCA 7; (2019) 239 LGERA 240, Moore J concluded that the s 119J notice was valid. It is unnecessary for the reasons appearing below to review that conclusion. What is however significant for present purposes is that Tropic firmly contends, as it has done for some time, that the notice is invalid.
3. Turning to the subpoena, Moore J said that there were in his view "four entirely separate bases providing a proper foundation for the issuing of the subpoena to the RMS".
4. First, his Honour found that there was no abuse of process because "a subpoena addressed to seeking (generally) the same documents [as sought by some other process] does not constitute an abuse of process". His Honour considered that the High Court decision in Environment Protection Authority v Caltex Refining Co Pty Ltd (1993) 178 CLR 477; [1993] HCA 74 established that.
5. Secondly, his Honour considered that the information obtained in February 2015 from Tropic by Mr Adams on behalf of the Council (see [5] above) demonstrated the correctness of the Council's submission that it was not "in any way fishing when it simply sought [by way of subpoena] the daily quantity sheets or the weigh bridge dockets for daily production". His Honour continued: "[160] …The inference to be drawn from [Mr Adams' affidavit] is that there was a proper basis upon which the Prosecutor could found the expectation that it was on the cards that documents that were likely to be produced pursuant to the subpoena, subsequently issued to the RMS, were adjectivally relevant to demonstration by the Prosecutor that each of Conditions (4) and (6) had been breached by the manner of operation by [Tropic] of its mobile asphalt plant during [Tropic's] fulfilment of its contract with the RMS."
6. Thirdly, his Honour considered that Mr Walsh's email of 11 February 2015 (see [6] above) "also constituted a sufficient basis upon which to conclude that the subpoena was validly issued …".
7. Fourthly, his Honour considered that the documents obtained by the Council under its GIPA Act application (see [7] above) constituted "a further separate and sufficient basis to uphold the subpoena to the RMS". His Honour noted that the material that the Council received pursuant to that application was "relevantly incomplete" but considered that "the filling in of the gaps in the information is adjectivally relevant and on the cards to materially assist the Prosecutor in proving its case in each of the two charges currently remaining against [Tropic]".
8. His Honour then addressed an alternative argument put by Tropic that if Tropic's argument that the subpoena should be set aside generally (or access denied to any documents produced under it) was rejected, the subpoena should be set aside in part (or access denied in part) because there was no legitimate basis upon which the Council could seek documents relating to days of supply other than the two specific days to which the charges had come to be confined (see [12] above), being 31 January 2015 in respect of Condition 4 and 18 March 2015 in respect of Condition 6. His Honour rejected this alternative argument on two bases.
9. First, he considered that documents relating generally to Tropic's period of supply to RMS would enable calculation of tonnages and truck movements on the two specific days the subject of the charges.
10. Secondly, he considered that such documents could arguably be admissible if tendered by the Council as tendency and/or coincidence evidence in accordance with notices given by the Council under ss 97(1)(a) and 98(1)(a) of the Evidence Act 1995 (NSW). The Council's argument was that proof of breaches of the development consent conditions on other days in the relevant period would improve its prospects of satisfying the Court that breaches occurred on the two days in question.

Relevant principles of law

1. The principal authority concerning the setting aside of subpoenas as an abuse of process and grants of access to documents produced pursuant to subpoenas is the decision of the Court of Appeal in National Employers' Mutual General Association Ltd v Waind and Hill [1978] 1 NSWLR 372.
2. In that case, Moffitt P (with the concurrence of Hutley and Glass JJA) at 381 described three steps that occur in the obtaining of documents under a subpoena and their utilisation in litigation. The first step involves the determination of any objections to the subpoena, the second involves the determination of claims to inspect documents produced under it, and the third involves the use of the documents in the litigation by their tender or other use such as in cross-examination.
3. His Honour then referred to a number of situations in which, at the first stage, a subpoena would be concluded to be an abuse of process. One would be where the subpoena required a stranger to the proceedings to form a view as to whether documents were relevant to an issue in the proceedings, so as effectively to seek discovery from the stranger. Another would be where the subpoena was expressed in such wide terms that it would be oppressive to require the recipient of the subpoena to collect and produce the documents referred to in it. Similarly, it would also be an abuse of process to require the production of documents, not for the purpose of the litigation, "but for some spurious purpose, such as to inspect the documents in connection with other proceedings …" (at 381-2).
4. His Honour then described at 384 the legitimate purpose for which a subpoena may be issued to a third party: "So far as factual matters are concerned, the proper conduct of the litigation can only be that which fairly leads to the introduction of all such evidence as is material to the issues to be tried, and the testing of that evidence by the accepted procedures of the court. The only legitimate purpose of requiring the production, and permitting the inspection, of a stranger's documents can be to add, in the end, to the relevant evidence in the case."
5. The second stage to which his Honour referred, involving the grant of access to documents produced, may involve the determination of claims to privilege in respect of the documents and at the third stage, questions of relevance and admissibility are ruled on. In respect of the grant of access at the second stage, his Honour said at 385 that: "… the limitation on the exercise of the judge's discretion to allow inspection is that the document contains information of apparent relevance to the issues. Once the judge has that opinion, inspection will normally be allowed, notwithstanding that the document is not admissible as it stands, and notwithstanding that the party seeking inspection has not given any undertaking to tender it, or use it in cross-examination." (Emphasis added.)
6. Applying these principles, Brereton J (as his Honour then was) concluded in A v Z [2007] NSWSC 899; (2007) 212 FLR 255 that he should determine whether the subpoena before him constituted an abuse of process "on the basis of asking whether, on the one hand, the documents called for are apparently relevant or capable of providing a legitimate basis for cross-examination, in which case there is a legitimate forensic purpose for the issue of [the] subpoena, or whether on the other, they are manifestly irrelevant and incapable of touching matters of credit, in which case the subpoena would be an abuse of process" (at [19]).
7. In this Court's decision in Attorney General (NSW) v Chidgey [2008] NSWCCA 65; (2008) 182 A Crim R 536, Beazley JA (with the concurrence of James and Kirby JJ) applied at [64] the following summary given by Simpson J (as her Honour then was) (with the concurrence of Spigelman CJ and Studdert J) in the earlier decision of this Court in R v Saleam [1999] NSWCCA 86 at [11]: "The principles governing applications [for an order that documents not be produced] are no different from those governing applications for access to documents produced in answer to a subpoena. Before access is granted (or an order to produce made) the applicant must (i) identify a legitimate forensic purpose for which access is sought; and (ii) establish that it is 'on the cards' that the documents will materially assist his case. So much was established in earlier proceedings brought by this applicant: R v Saleam (1989) 16 NSWLR 14, per Hunt CJ at CL; see also R v Tastan (1994) 75 A Crim R 498 per Barr AJ, as he then was."
8. Beazley JA noted that the genesis of the expression "on the cards" was in the judgment of Gibbs CJ in Alister v The Queen (1984) 154 CLR 404; [1984] HCA 85. In that case, his Honour used the expression in contrast to "a mere 'fishing' expedition" (Chidgey at [65]-[66]).
9. The Court of Appeal reviewed these authorities in ICAP Australia Pty Ltd v BGC Partners (Australia) Pty Ltd [2009] NSWCA 307 and at [22] and [25] concluded that whilst it is necessary that it be shown that "it is likely [that] the documentation [subpoenaed] will materially assist on an identified issue", the word "likely" was not used in that formulation in the sense of "more likely than not".

Tropic's proposed appeal

1. In its written submissions Tropic identified the grounds upon which it sought to appeal as follows: "(a) the primary judge failed to consider Tropic's submission that the subpoena had not been issued by the prosecutor for any legitimate forensic purpose, and if he had considered that submission he should have found that the subpoena had not been issued for any legitimate forensic purpose; (b) the primary judge erred in finding that all the documents sought by the subpoena were likely to be "[adjectivally] relevant" to the issues arising in the prosecutions, and instead should have limited the scope of the subpoena as sought by Tropic."
2. Tropic's argument in support of the first ground was founded wholly upon the Council's service of the s 119J notice (referred to at [8] above) and the production of documents to the Council in response to it. That Tropic's argument had to be so founded is confirmed by considering the position if that s 119J notice is disregarded. If that is done and Tropic's fallback argument concerning the subpoena's scope is put aside, the conclusion is inevitable that the subpoena was issued for the purpose of obtaining documents which on their face would be arguably relevant to the Council's proof of its charges against Tropic. As Waind and Hill (see [24] above) demonstrates, this is the fundamental, legitimate purpose for which subpoena may be issued. Further, there is no present contention that the subpoena is an abuse of process because it is being used as a substitute for discovery, to pursue a "fishing expedition" or to advance an ulterior purpose.
3. It is true that the subpoena seeks the production of documents all, or at least most, of which are likely to have already been produced by RMS to the Council under the s 119J notice. That fact, considered in isolation, might raise a question of whether the Council pressing for production under the subpoena would be an abuse of process, being arguably impermissible to put a stranger, or indeed a party, to the time and expense of compliance with a subpoena when the issuer has already obtained the documents to which it refers. As I note below, I do not consider the decision in EPA v Caltex to be inconsistent with that proposition.
4. In the present case, the Council however gave, and continues to give, an explanation for pressing for the production under the subpoena of copies of documents it has already acquired under the s 119J notice. That is, that Tropic has for some time contended, and still contends, including on the present application for leave to appeal, that the s 119J notice is invalid and that any use by the Council in the LEC litigation of documents produced under it would be unlawful, with the result that the documents could be held to be inadmissible if tendered in support of the Council's charges. Notwithstanding that Moore J has now, in his judgment sought to be appealed from, rejected Tropic's arguments that the s 119J notice is invalid, a risk that Tropic's stance is correct remains.
5. In these circumstances, there is not in my view any reason why the Council should not seek to obtain in another, undoubtedly untainted, manner, the documents with which it will seek to prove its case against Tropic in the LEC. I emphasise that this is not a case in which the Council's knowledge of the existence of the documents came to it through RMS's production under the allegedly invalid s 119J notice. If that had been the situation, Tropic might have had an argument that the documents sought should be excluded under s 138 of the Evidence Act from tender in the proceedings because they were improperly or illegally obtained, knowledge of their existence only having been acquired through issue of an invalid notice. Tropic could have argued that in such circumstances to seek production of the documents by the subpoena was an abuse of process.
6. The primary judge however made it clear in findings that are not sought to be challenged that the Council acquired its knowledge of the documents held, or likely to be held, by RMS well prior to its issue of the s 119J notice, by way of the conversation with Tropic's Plant Manager and the email from RMS's Works Manager referred to at [5] and [6] above. There is in my view, and contrary to Tropic's submission, no reason why a party should not in such circumstances seek by the issue of a subpoena to overcome inadequacies, for the purpose of proof, of material already in its possession. Such a step is commonly taken in litigation. Innumerable examples could be given, two of which would be an attempt to obtain direct evidence when only hearsay evidence is held and an attempt to obtain an original document when only a copy is held.
7. Contrary to Tropic's argument identified at [14(1)] above, the purpose of the Council to which it there refers is a legitimate forensic purpose and, as I indicate below, the primary judge so found.
8. I turn then to consider the way in which the primary judge dealt with Tropic's application.
9. The first of his Honour's four separate bases for rejecting the application was the decision in EPA v Caltex, which his Honour regarded as "determinative" of the application.
10. In that case, Caltex was served with two notices requiring the production of identical documents, one notice under the Clean Waters Act 1970 (NSW) and the other a notice to produce in accordance with the Rules of the Land and Environment Court 1980 (NSW). The decision was principally concerned with issues concerning the privilege against self-incrimination, but one of the questions of law stated by the LEC for consideration by the Court of Criminal Appeal was whether the notice to produce under the Rules should be set aside as an abuse of process because it required the production of the same documents as the earlier statutory notice. The answer given by the High Court was "No" but there was no reasoning directed to that answer and indeed it is doubtful that the question related to a matter in issue in the High Court as Mason CJ and Toohey J said at 489 that "[t]here is no dispute in this case that the notice to produce was validly issued", the only issue being one of self-incrimination.
11. The decision of this Court in the same litigation (Caltex Refining Co Pty Ltd v State Pollution Control Commission (1991) 25 NSWLR 118) was however more illuminating as the answer given to the same question was "No, it may have a proper purpose to serve as laying the foundation for the admission of secondary evidence". This reflected an observation of Gleeson CJ (with whom Mahoney JA and McLelland J agreed) at 123-4 that there was only one limited distinction between the statutory notice and the Rules notice, that is, that the latter might be able to be used as a basis for tendering secondary evidence.
12. The upshot is that I do not consider the decisions in the EPA v Caltex litigation to indicate that the issue of a subpoena to obtain documents already otherwise obtained can never be an abuse of process. The High Court decision is of little precedential value because of the absence of any discussion of the question but this Court's decision indicates that it is not an abuse of process to issue two notices seeking the production of identical documents if there is a bona fide reason for doing so. That is the position in the present case because of the doubts concerning the validity of the s 119J notice and consequently also as to whether the Council would be able to tender documents produced under it in its LEC proceedings against Tropic. Tropic was not able to cite any authority to suggest otherwise.
13. The primary judge's second and third reasons (see [18] and [19] above) were tantamount to findings that the Council had a legitimate forensic purpose for issuing and pressing the subpoena, although his Honour did not use that expression. By that reasoning, his Honour found, expressly or impliedly, that the subpoena sought the production of documents for the legitimate purpose of tender in the LEC proceedings against Tropic, that its knowledge of the existence of the documents did not derive from the documents produced under the allegedly invalid s 119J notice and that the Council did not have any illegitimate purpose in issuing and pressing the subpoena. The reasoning therefore indicated compliance with the Saleam test, adopted in Attorney General v Chidgey, of identification of a legitimate forensic purpose for which access is sought and a conclusion that it is "on the cards" that the documents will materially assist in proving the subpoena issuer's case. As to the latter, in light of the conversation with Tropic's Plant Manager and the email from RMS's Works Manager (see [5]-[6] above), the Council had, and still has, a reasonable basis for considering that the documents, when produced under the subpoena and made available to it, are likely to materially assist its case. Contrary to Tropic's submission, I do not consider that the primary judge's reasoning was deficient in failing to state explicitly that he found these matters established. His Honour's reasoning was entirely adequate.
14. The same observations are applicable to the primary judge's fourth separate reason for rejecting Tropic's application (see [20] above). There was no reason why the Council should not by way of subpoena seek to obtain complete information from RMS when RMS's production under the GIPA Act had critical statistics redacted on the basis of a commercial sensitivity plea advanced by Tropic. Taking such a course does not constitute an abuse of process.

The scope of the subpoena

1. I turn then to consider Tropic's fallback position, that the Council's pressing of the subpoena constitutes an abuse of process at least so far as it seeks production of documents relating to days of supply other than the two specific days which are now the only subjects of the charges against Tropic. This argument was not available when the subpoena was issued as there were then charges subsisting in relation to many more days.
2. As Tropic implicitly recognised in this Court, it could not succeed on this argument if the Council satisfied the Court that the broader category of documents was arguably relevant to issues in the proceedings. This approach is consistent with the observation in ICAP Australia (see [32] above), that it is not necessary to show that the documents sought under subpoena will "more likely than not" assist the case of the party which issues the subpoena. Arguable relevance suffices.
3. There are a number of bases upon which the subpoenaed documents not directly related to the two days the subject of the present charges were, and are, arguably relevant to the issues in the proceedings.
4. First, as the primary judge held (see [22] above), documents relating generally to Tropic's period of supply to RMS, giving totals for the period, could well enable tonnages and truck movements on the two specific days to be calculated, or at least estimated. Neither the Council nor his Honour was bound to proceed upon the basis that the documents to be produced by RMS in respect of the two specific days would constitute irrefutable proof of the Council's case. The Council was entitled to take a more cautious approach and arm itself with more than one means of proving its case.
5. Secondly, again as his Honour held (see [23] above), the documents would arguably be admissible as tendency or coincidence evidence to prove what occurred on the two particular days. That is, they could provide the Council with another possible means of proving its case.
6. Thirdly, whilst the offence against s 125(1) of the EPA Act the subject of the Council's prosecution is one of strict liability, a defence of honest and reasonable mistake would at least arguably be available (see State Rail Authority of NSW v Hunter Water Board (1992) 28 NSWLR 721 at 722; North Sydney Council v Moline (No 2) [2008] NSWLEC 169 at [17]-[18]; CTM v The Queen (2008) 236 CLR 440; [2008] HCA 25). If that "defence" (see CTM at [6]) were raised by Tropic in such a way as to discharge its evidential burden, it would be incumbent on the Council as prosecutor to negative the defence. The documents in the broader category would be likely to assist the Council to do that.
7. Fourthly, the documents in the broader category would arguably be relevant to sentencing in the event that the prosecution succeeded, at least on the question of whether the offences were part of a "planned or organised criminal activity" or were isolated acts (see Crimes Sentencing Procedure Act 1999 (NSW) s 21A(2)(n)). As well, the offender's "intention and appreciation of the offence" is relevant in sentencing in respect of strictly liability offences (Hardt v Environment Protection Authority [2007] NSWCCA 338; (2007) 156 LGERA 337 at [53]; Environment Protection Authority v Wollondilly Abattoirs Pty Ltd [2019] NSWCCA 312 at [72]). Tropic's conduct generally in the period in which the two charged days fell would be relevant to this topic.
8. These considerations are sufficient to dispel any suggestion of abuse of process on the part of the Council. That is not to say however that the primary judge would not be entitled to exercise from time to time his undoubted discretion to regulate access by the Council to the subpoenaed documents if his Honour saw a need to do so. That would be a matter of practice and procedure in relation to which appellate courts rarely grant leave to appeal (see In re the Will of Gilbert (1946) 46 SR (NSW) 318 at 323).
9. In these circumstances, Tropic's secondary argument should be rejected, as its primary argument has been.

Conclusion

1. For the above reasons, the arguments Tropic seeks to put on appeal are without merit and, at least for that reason, leave to appeal should be refused.
2. I add the following observations as to the progress of the proceedings below. This Court is not in a position to know where, if anywhere, blame lies for the inordinately long time that the substantive proceedings have taken to come to trial, being in excess of 4 years so far, with there being no current fixture of the proceedings for hearing. In these circumstances, it is timely to recall the repeated deprecation by this Court of the progress of criminal proceedings to finality being interrupted by unnecessary interlocutory appellate applications (see for example R v Rogerson (1990) 45 A Crim R 253 at 254; Chow v Director of Public Prosecutions (1992) 28 NSWLR 593 at 599-600 and R v Steffan (1993) 30 NSWLR 633 at 642-3). The present application for leave to appeal has caused an unjustified interference with the criminal proceedings at first instance.
3. BUTTON J: I agree with Macfarlan JA.
4. IERACE J: I agree with Macfarlan JA.

Amendments 03 March 2021 - [13]: correction of a spelling error. 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: 03 March 2021