On 23 March 2021 Unified Security Group (Australia) Pty Ltd (USG) applied to the Tribunal for administrative review under the Administrative Decisions Review Act 1997 (the ADR Act) of the decision made under the Security Industry Act 1997 (the SI Act) by the respondent Commissioner of Police to revoke its Master Security Licence, with effect from 5.00pm 2 April 2021.
On the same date USG applied for an order to stay the decision. In support of that application, on 29 March 2021 USG provided written submissions, and affidavits sworn on 29 March 2021 by Mr Manu Mathen, Finance Manager of USG, and Mr Matthew Conway, Chief Executive Officer of USG.
The applications were listed on 30 March 2021. Consent orders were made to stay the operation of the decision, noting an undertaking given by USG, until 5.00pm 26 April 2021, when the hearing of the stay application was listed.
[2]
Summons
On 7 April 2021 the Commissioner requested the issue of a summons for production of documents by USG. A summons was issued by the Registrar on 8 April 2021, returnable on 15 April 2021. Annexure A to the summons identified 6 categories of documents sought.
On 9 April 2021 USG informed the Commissioner that it objected to producing the material in item 1(d) of Annexure A on the basis that it bears no relevance to the matters in issue before the Tribunal, and requested agreement to an extension of time for compliance to 22 April 2021 in circumstances where there was a significant volume of material to collate.
Item 1(d) is as follows:
For the financial years ending June 2019 and June 2020 and for the period of 1 July 2020 to 31 March 2021, a copy of the following reports:
…
(d) payroll reports identifying each employee of Unified Security Group (Australia) Pty Ltd and, if the payroll reports do not identify each employee, the reports and/or records maintained by Unified Security Group (Australia) Pty Ltd identifying each person employed by Unified Security Group (Australia) Pty Ltd at any time during the period specified.
…
On 13 April 2021 the Commissioner advised USG that it pressed for production of the documents captured by item 1(d), as directly relevant to:
1. Evidence in the affidavit of Matthew Conway dated 29 March 2021 in relation to the number of employees of USG (paras [8] and [21]);
2. The analysis of evidence in the affidavit of Manu Mathen dated 29 March 2021, particularly items on the Balance Sheet annexed to that affidavit; and
3. The issue of whether USG breached s 38A of the SI Act by providing unauthorised persons to carry on security activities through subcontractors.
On 14 April 2021 USG's lawyers wrote to the Tribunal objecting to production of the documents specified in item 1(d) and item 6 of the Annexure.
Item 6 is as follows:
A copy of all written consents from clients of Unified Security Group (Australia) Pty Ltd to Unified Security Group (Australia) Pty Ltd for the use of subcontractors in the provision of a security activity in NSW for the financial years ending June 2019 and June 2020 and for the period 1 July 2020 to 31 March 2021.
At the return of summons on 15 April 2021 the Deputy Registrar directed that the objection be referred to a Tribunal Member for determination. The matter was listed before me on 20 April 2021, when counsel for USG made submissions in support of its objection. Directions were made for the Commissioner to respond by 12.00pm 21 April 2021, with any reply by USG by 2.00pm on 21 April 2021.
On 21 April 2021 orders were made to dismiss the objections to items 1(d) and 6 of the summons, and to order pursuant to s 64 of the Civil and Administrative Tribunal Act 2013 that access to the documents produced is restricted to the Respondent and its legal representatives, and is to be used only for purposes directly connected with these proceedings. The parties were advised that written reasons would be provided.
The following are the reasons for those orders.
[3]
USG's objection
USG objected to production of material in item 1(d) on the basis that it bears no relevance to the issues before the Tribunal. USG submitted that the Commissioner does not require the identities of 745 employees to verify the statement of Mr Conway in his affidavit of 29 March 2021; that there is no legitimate forensic purpose in seeking the information, as analysis of evidence in the affidavit of Mr Mathen will not be assisted by information as to the identifies of USG's employees; and that the Commissioner should not be permitted to use the powers of the Tribunal to obtain material that relates to an ongoing investigation and which does not explicitly relate to the decision under review.
The basis for the objection to para 6 of the summons was the submission that the Commissioner is seeking to obtain material for an ulterior purpose and to further an ongoing investigation into matters which are not the subject of the decision under review.
In oral submissions on 20 April 2021 USG submitted that the identities of its employees is sensitive information, and it is concerned that the material may be provided to competitor organisations. USG would agree to redaction of the identities of the individuals in item 1(d), or access to legal representatives only. USG accepted that the documents in item 6 have some relevance, but not for the stay. USG submitted that this is not an appropriate stage of the proceedings to require production of those documents, and there is no legitimate forensic purpose in requiring production now.
USG confirmed at the hearing on 20 April 2021 that if its objection is not upheld it is in a position to produce the documents at the return of summons on 22 April 2021, and would seek an order for access to legal representatives only.
[4]
Commissioner's submissions
The Commissioner submitted that material in items 1(d) and 6, being payroll records and written consents to subcontracting, would provide proof of the allegations that USG engaged in subcontracting prohibited by the SI Act, and would demonstrate that many of the "employees" of USG who USG claims would lose their jobs if the decision is not stayed, are in fact subcontractors.
The Commissioner submitted that the material in item 1(d) is relevant both to the application for a stay of the decision as well as the issues that arise under the substantive review proceedings, being relevant to:
1. evidence in the affidavit of Mr Conway dated 29 March 2021:
1. Para [8] regarding the number of employees of USG;
2. Para [21] where he asserts that if the stay is not obtained 745 employees of USG will need to be made redundant;
3. Ascertaining in which jurisdiction those employees are employed;
4. Verifying that none of the claimed employees are subcontractors; and
5. Ascertaining whether the employees are permanent or casual.
6. The number of redundancies and the type of employment entitlement liabilities that the NSW licence revocation is likely to produce will depend on factors (c) to (e);
1. The analysis of evidence in the affidavit of Manu Mathen dated 29 March 2021, particularly items on the annexed Balance Sheet such as the sums given in relation to "Subcontractors-Guards", "Wages and Salaries" and "Payroll Tax Expenses";
2. Whether USG breached s 38A of the SI Act by providing unauthorised persons to carry on security activities through subcontractors, an issue squarely raised in para [21(b)] of the Commissioner's submissions on the stay application where it is submitted that the documents would demonstrate that many of the "employees" are in fact subcontractors;
3. Whether USG is providing services through unlicensed persons in breach of s 39 of the SI Act. Payroll reports identifying employees will enable the Commissioner to assure the Tribunal that any security services provided pursuant to any stay order it may make will not be provided illegally.
The Commissioner submitted that the material in item 6 is also relevant both to the application for a stay of the decision as well as the issues that arise under the substantive review proceedings. Those documents are central to the allegations that USG engaged in subcontracting prohibited by s 38A of the SI Act.
The Commissioner opposed redaction of the identity of the employees, on the ground that that would not enable the information to be used for the purpose for which it is sought, and pressed for production in full.
[5]
Relevant Principles
A summons may be set aside for various reasons, which may overlap, falling into the categories of abuse of process, oppression of the addressee of the summons, insufficient particularisation, lack of apparent relevance, and using a summons as a fishing expedition.
The relevant legal principles to be applied in determining what is a legitimate forensic purpose for the issue of a summons were comprehensively summarised by Ward J (Chief Judge in Equity) in Rhinehart v Rhinehart [2018] NSWSC 1102:
As to what is a legitimate forensic purpose for the issue of compulsory process of this kind (subpoenas or, as considered in some of the cases, notices to produce), the Court of Appeal in ICAP Australia Pty Ltd v BGC Partners (Australia) Pty Ltd [2009] NSWCA 307, held that the primary judge had not erred by stating that, for a notice to produce to have a legitimate forensic purpose:
... it must be shown that it is likely the documentation will materially assist on an identified issue, or there is a reasonable basis beyond speculation that it is likely the documentation will.
Determining whether there is a legitimate forensic purpose requires reference to the particular case, or identified issue, that the documentation sought is reasonably expected to be likely to assist, as observed by Nicholas J in ICAP Pty Ltd v Moebes [2009] NSWSC 306 (at [33]):
... the legitimate forensic purpose of a subpoena necessarily depends upon identification of the case which is likely the documentation will assist. The task in meeting the test will become difficult where the issue relied upon cannot be identified because either it has not been included in the pleadings or particulars, or the terms in which it has been expressed are obscure and imprecise.
In Portal Software International Pty Ltd v Bodsworth [2005] NSWSC 1115, Brereton J described the relevant test (in considering whether to set aside the notice to produce that had there been issued) as being (see at [24]) whether the documents sought have "a sufficient apparent connection to justify their production or inspection" (citing White v Tulloch (1995) 127 FLR 105; 19 Fam LR 696). His Honour said that the test of adjectival relevance (i.e., as distinct from substantive relevance) will be satisfied if the material has apparent relevance and is established if the documents called for "could possibly throw light on the issues in the main case" (at [24]), citing Trade Practices Commission v Arnotts Ltd (No 2) [1989] FCA 340; 21 FCR 306).
More recently, Gleeson JA, in In the matter of Force Corp Pty Ltd (Recs and Mgrs Apptd) (in liq) [2018] NSWSC 896 described the permissible scope of a subpoena for production of documents as directing attention to the apparent relevance of the documents sought (see at [22]).
Whether the formulation of the test in civil proceedings is best expressed as an "on the cards" test (i.e., that it is on the cards that the documents sought will materially assist on an identified issue) (see the use of that expression in criminal proceedings in Alister v R (1984) 154 CLR 404; [1984] HCA 85; R v Saleam (1989) 16 NSWLR 14, at 18; Attorney-General (NSW) v Chidgey [2008] NSWCCA 65), or that the material could "possibly throw light on" an identified issue (see Trade Practices Commission v Arnotts Ltd (No 2); or as formulated by Nicholas J in ICAP Pty Ltd v Moebes at [30] (namely, that "it must be shown that it is likely the documentation will materially assist on an identified issue, or there is a reasonable basis beyond speculation that it is likely that the documentation will [materially assist]"), what is ultimately required is an assessment as to the relevance of the documents sought by reference to the issues in the proceedings (see Cosco Holdings Pty Ltd v Federal Commissioner of Taxation (Cth) [1997] FCA 1504; 37 ATR 432 at 439-440 per Spender J; Nicholls v Michael Wilson and Partners Limited [2010] NSWCA 100 per Young JA).
Where there is no legitimate forensic purpose, in that sense, for the issue of a subpoena then it may readily be seen to be a fishing expedition. As to what is meant by a "fishing expedition", in Associated Dominions Assurance Society Pty Ltd v John Fairfax & Sons Pty Ltd (1952) 72 WN (NSW) 250, at 254, it was said:
A "fishing expedition", in the sense in which the phrase has been used in the law, means, as I understand it, that a person who has no evidence that fish of a particular kind are in a pool desires to be at liberty to drag it for the purpose of finding out whether there are any there or not. If, however, there is material before the Court pointing to the probability that a party to litigation has in his possession documents tending to destroy his case or to support the case of his opponent and that privilege from inspection of such documents has been wrongly claimed, an application by that opponent to be allowed to inspect them cannot properly be described as a mere "fishing expedition".
…
The central requirement is that the documents sought are likely to inform the proper determination of the issues in the proceedings. To the extent that a summons requires the production of documents with insufficient apparent relevance to the proceedings, it should be set aside: Trade Practices Commission v Arnotts Ltd (No 2) (1989) 21 FCR 306.
Production of documents under summons is not dissemination of the information to the public or a section of the public. Documents produced under summons will only be available to the parties to the proceedings if access to those documents is granted. Documents produced under summons will only become part of the evidence in the proceedings if tendered in evidence by one of the parties and admitted into evidence at the hearing.
NCAT Procedural Direction 2: Summonses states:
Documents and other things obtained under a summons must only be used for purposes directly connected with the proceedings. Using the documents or other things for any other purpose or publishing their contents for any other purpose, may constitute contempt of the Tribunal and be punishable by fine or other orders.
That provision is consistent with the implied undertaking which prevents any material obtained under a summons from being used for a collateral or ulterior purpose: Plate Glass Holdings Pty Ltd v Fraser Gordon Investments Pty Ltd [2012] FCA 1487 at [22]-[35].
[6]
Discussion and findings
In determining whether the objections to production of the documents in item 1(d) or item 6 should be upheld, it is necessary to identify the relevant issues in the proceedings.
In the present proceedings there are two applications: the application for administrative review of the decision to revoke the licence, and the application for a stay of the operation of that decision.
In the application for administrative review, the Tribunal will be required to determine what the correct and preferable decision is having regard to the material then before it including any relevant factual material, and any applicable law: ADR Act, s 63(1). In determining the review, the Tribunal may decide to affirm the decision, vary the decision, or set aside the decision and make a decision in substitution for it and remit the matter for reconsideration by the administrator: ADR Act, s 63(3).
The decision to revoke the licence was based on findings made in respect of six allegations put to USG in Show Cause notices. In summary, the issues raised in the substantive review include:
1. whether USG breached a condition on its master licence, by failing to notify the administrator, the Security Licensing & Enforcement Directorate (SLED) of details of its close associates, that is persons with a relevant financial interest, position or power in USG;
2. whether those persons, Mr Luigi Trunzo and Mr David Millward, were, or continue to be close associates of USG, or are ineligible to be close associates;
3. whether USG provided security services in breach of s 39 of the SI Act, by providing a person for security services at Hornsby Hospital who was no longer the holder of a security licence;
4. whether USG provided security services by subcontracting without the approval of the customer, in breach of the relevant contract and s 38A of the SI Act, when providing services to Hornsby Hospital and at various Ausgrid sites from 2018 to 2019;
5. whether USG had failed to comply with a notice issued under s 39O of the SI Act which required production of information about persons provided by USG in NSW both as direct employees and through subcontractors during the period 1 June 2019 to 30 June 2019.
In the application for the stay, the issue is whether an order is appropriate "to secure the effectiveness of the determination of the application", having regard to the relevant considerations which include the interests of any persons who may be affected by the determination of the application for review, any submission made by the administrator who made the decision, and the public interest: ADR Act s 60. The applicant's prospects of success on the application for review are relevant.
In support of the stay application USG submits that it will suffer irreparable harm, financial loss and damage without a stay, that the determination of the administrative review will be futile because its business will collapse, and that there are serious issues to be tried in relation to the revocation. Mr Conway's evidence is that there are 745 employees in NSW who will lose their income, and if USG loses its licence it will not be able to service its ongoing projects or projects for which it is currently tendering. USG contends that the revocation of the licence on a mandatory ground under the SI Act involved a misinterpretation of the relevant provisions in the legislation, and the other grounds consist of isolated allegations or incidents which relate to the discretionary power of the respondent.
The Commissioner opposes the grant of a stay. In submissions filed on 19 April 2021 the Commissioner submits that USG has failed to establish that the effectiveness of the determination of the review application will not be secured without a stay; that its claim that it will suffer catastrophic economic loss and that 745 employees will be made redundant is not made out on the evidence; that USG has failed in its duty of candour to the Tribunal; that USG has deliberately flouted a clear statutory prohibition on the unauthorised use of subcontractors; that Mr Millward and Mr Trunzo have not divested themselves of relevant interests and powers in relation to USG and remain close associates; and that USG has engaged in deliberate breaches of the legislation.
[7]
Item 1(d)
USG's position on the stay application is that if a stay is not obtained its employees in NSW, including those engaged in the NSW Hotel Quarantine program, will have to be made redundant, and it will not be able to continue to provide security services to meet existing contracts for clients in NSW, or take advantage of security work for which it is currently tendering.
The Tribunal is satisfied that information confirming the number of USG's employees in NSW and their employment status is relevant to the consideration for the purposes of the stay application of the interests of any persons who may be affected by the determination of the application required by s 60(3)(a) of the ADR Act. It is relevant to consideration of the financial impact on the business if it is not able to operate pending determination of the administrative review application. The period for which the documents are sought includes the period the subject of the allegations relating to unauthorised subcontracting; and information verifying the employment status of identified individuals is likely to be relevant to that issue in the substantive review application.
The Tribunal is satisfied that the documents specified in item 1(d) have a sufficient apparent connection with the issues raised in the stay application, and those in the substantive administrative review, and will materially assist in the resolution of those issues.
USG is not asserting that production of the information specified in item 1(d) would impose an unduly onerous obligation.
USG opposes provision of the information in a form that identifies the individuals concerned, submitting that that information is sensitive and personal to those individuals. The Tribunal accepts that information confirming the identities of individuals engaged by USG for provision of security work is likely to be relevant to determination of the allegations relating to unauthorised subcontracting. In addition to the implied undertaking which limits the use which may be made of that information, any documents produced under summons are available to the parties to the proceedings only if access to those documents is granted, and only become part of the evidence in the proceedings if tendered in evidence, and admitted. In that context, the Tribunal has power under s 64 of the Civil and Administrative Tribunal Act 2013 if satisfied that it is desirable to do so by reason of the confidential nature of any evidence or matter or for any other reason, to prohibit or restrict disclosure or publication of the name of any person or to prohibit or restrict publication of any evidence given or documents lodged with the Tribunal.
The Tribunal is satisfied that there is a legitimate forensic purpose for production of the documents specified in item 1(d) in an unredacted form.
[8]
Item 6
USG submits that the documents identified in item 6 are sought for an ulterior purpose, namely to further an ongoing investigation into matters not the subject of the decision under review. As noted above, a summons may be set aside if it is an abuse of process, including where it has not been served bona fide for the purpose of obtaining relevant evidence: Botany Bay Instrumentation & Control Pty Ltd v Stewart [1984] 3 NSWLR 98.
One of the issues in the administrative review application is whether USG breached s 38A of the SI Act by subcontracting for provision of security services without the agreement of the client. The allegations the subject of findings in the decision under review specified the period, the identity of the alleged subcontractor, and the location at which security services were provided. The period specified in item 6 covers the relevant time frame for the specific allegations, and the period since then. The Tribunal is of the view that information going to whether there was consent given by the client for any subcontracting is likely to be materially relevant to the issues raised in the substantive review. The strength of the applicant's case is a relevant factor in the determination of whether a stay should be granted, and the Tribunal is of the view that whether or not USG engaged in subcontracting prohibited by s 38A has a sufficient connection with the issues to be determined on the stay application, such that the documents identified in item 6 are likely to be materially relevant.
The Tribunal is satisfied that there is a legitimate forensic purpose for production of the documents specified in item 6. The implied undertaking prevents any material obtained under a summons from being used for a collateral or ulterior purpose. An order can be made restricting access to the documents, by limiting the persons entitled to have access and the purposes for which that access is granted.
[9]
Orders
The orders of the Tribunal are:
1. The objection by Unified Security Group (Australia) Pty Ltd to production of the documents specified in item 1(d) and item 6 of Annexure A to the Summons to Produce issued on 8 April 2021 is dismissed.
2. An order is made pursuant to s 64 of the Civil and Administrative Tribunal Act 2013 that access to the documents produced is restricted to the Respondent and its legal representatives, for use only for purposes directly connected with these proceedings.
[10]
I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.
Registrar
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: 23 February 2023