Did Mr Caratti request the disputed material on his own behalf or on behalf of the companies; or both?
179 Mr Caratti, in his statement of facts, and in the evidence he gave at the hearing, including during cross-examination as set out above, contended that his solicitors, Wilson & Atkinson, acting for him alone, requested copies of the seized materials from the AFP pursuant to s 3N of the Crimes Act, being the documents subsequently provided on the hard drives to his then solicitors.
180 He says that he wanted to obtain copies of the materials because he was the subject of the warrants and also because, as a director of the company, he wished to ensure he met his obligations as a director under corporations law and more generally.
181 The companies contest Mr Caratti's factual assertion and say the position is that, even if Mr Caratti's solicitors made the request for copies under s 3N just for Mr Caratti, Mr Caratti's instructions to his solicitors also encompassed the companies whose documents had been seized. This is the first issue stated above.
182 The companies also say that, in the event of a finding that only Mr Caratti made the 3N request, then they contest his entitlement to have done so and so to now retain possession of the hard discs. That is the second issue stated above, to which will turn below.
183 The companies submit that the assertions of Mr Caratti on the first issue are implausible, at least so far as they concern the documents seized at 48 Wickham Street, and that Mr Caratti should be regarded as having made the request, at least in respect of 48 Wickham Street, in his capacity as a director of and therefore on behalf of each of the companies.
184 In making this submission, the companies rely on the following circumstances, namely that:
The companies conducted their business operations from 48 Wickham Street.
This is evidenced by the fact that the registered office and principal place of business for GH1, IME and Mammoth Civil was, and continues to be, 48 Wickham Street.
From 9 August 2017, and presently, the registered and principal place of business of MNWA became and continues to be 48 Wickham Street.
At the time the search warrants were executed and presently, the hard copy books and records of GH1, MNWA, IME and Mammoth Civil were and are located at 48 Wickham Street.
At the time the search warrants were executed and presently, the electronic servers on which books and records of GH1 and MNWA are stored were and are located at 48 Wickham Street, along with other electronic volumes and devices upon which other books and records of GH1 and MNWA are stored.
GH1 stored its books and records at 48 Wickham Street and meetings of the directors of the company were held at 48 Wickham Street.
At the time the warrants were executed Mr Caratti was present at 48 Wickham Street, he, at material times, being a director and secretary of MNWA, a director and secretary of Mammoth Civil, a former director and secretary of GH1 and IME, and a person who acted in a position of director of the companies whose documents were seized.
At the time the search warrants were executed, Ms Bazzo was present at 48 Wickham Street, she being at the time a director and secretary of GH1, and at the time an employee of MNWA.
At the time the search warrants were executed, Mr Ellison was present at 48 Wickham Street, he being at the time a director and secretary of IME (and presently the director and secretary of Mammoth Civil and MNWA).
185 The companies also say, in support of their submission that Mr Caratti's factual contentions are implausible, that:
Mr Caratti has admitted that at the time of the execution of the warrants, GH1 was the registered proprietor of 48 Wickham Street and therefore GH1 had a right to exclusive possession, or alternatively possession of 48 Wickham Street; or a right to be considered the occupier of the premises to the exclusion of others including Mr Caratti, noting that whilst Mr Caratti asserts he had rights of access to the premises to access documents, that right of access did not give rise to him being considered an "occupier" for the purposes of s 3N of the Crimes Act.
Mr Caratti has also admitted that at the time of the execution of the warrants, the documents of the Caratti group entities were kept at 48 Wickham Street and that some hard copy books and records of each of the companies were located there and electronic servers on which some books and records of the companies were stored there.
Mr Caratti has admitted that some of the originally seized materials are books and records of one or more of the companies.
Mr Caratti was and is presently a director and secretary of MNWA, director and secretary of Mammoth Civil, and a former director and secretary of GH1 and IME and notwithstanding his denial, the evidence demonstrates he was a person who acts in the position of director.
186 Put quite shortly, the companies submit that the Court should conclude that:
Mr Caratti was present at 48 Wickham Street in his capacity as a director of each of the companies, or alternatively as a representative of the companies, by virtue of his office as a director or alternatively pursuant to the authorisations Mr Caratti contends were provided to him by entities including the companies; and
Mr Caratti's requests were made, at least in respect of 48 Wickham Street, in his capacity as a director of each of the companies and therefore for the purposes of s 3N of the Crimes Act, being a person who apparently represented the companies as occupiers of premises.
187 As noted above, Mr Caratti has made a formal admission for the purposes of the Court's determination of the relief sought in these proceedings (but not for any other purpose), that [28(d)(i)(2)] of the companies' second amended statement of facts, issues and contentions filed 2 March 2018 is admitted, that is, he was at the time of execution of the search warrants a person who acted, and is presently a person who acts, in the position of a director or further or alternatively a person in respect of whom the directors of the companies were/are accustomed to acting in accordance with his instructions and wishes.
188 Mr Caratti's affidavit evidence and submission prior to being cross-examined on his affidavit and when cross-examined in the proceeding, is as follows.
189 As to the unsigned 9 February costs agreement letter, he does not recall seeing the document. He maintained that evidence in cross-examination.
190 Mr Caratti said he did not know why the document was addressed to Mr Caratti and Ms Bazzo of Gucce Holdings (of which he was not a director), nor why the document made provision for signing by Gucce Holdings, MNWA and himself.
191 He said there was no apparent attempt by Wilson & Atkinson to have, as clients in respect of the search warrant retainer, all the other myriad entities in relation to their seized books and records.
192 He noted the proposed work referred to in the 9 February costs agreement letter included, "(b) representing you with the Court proceedings to set aside the warrants". He said there was no suggestion that Gucce Holdings provided instructions in respect of the search warrant proceedings. The only applicant in the search warrant proceedings was him, Mr Caratti.
193 Mr Caratti said he understood that the retainer was between Wilson & Atkinson and him, and not subject to the 9 February costs agreement letter.
194 Mr Caratti says it cannot be in dispute that, when Wilson & Atkinson made the request to the AFP for copies of the seized materials, that request was made for him. He says that is corroborated by numerous references in the request and other correspondence between Wilson & Atkinson and the AFP to "client" in the singular: "the client", "our client", "your client". He was the "client".
195 Mr Caratti notes that, as at the date of his request by his solicitors of 20 February 2015 for copies of documents seized, the search warrants had only recently been executed; the challenge to them had only recently been commenced; it was proposed to issue notices to produce; points of claim had not yet been filed; his lawyers were still seeking a copy of the sworn complaint; and his evidence was not yet due to be filed.
196 Mr Caratti says he understood that his lawyers needed a copy of what was seized in order to assist consideration by them of how to advise him in respect of the challenge to the search warrants, taking into account broader considerations of Mr Caratti's interests in connection with possible criminal proceedings.
197 He says this, unsurprisingly, was his principal reason for wanting copies of documents to be prepared for his lawyers.
198 He says the documents later received from the AFP, on the hard discs, were reviewed by his lawyers for this purpose (however privilege has not been waived over advice given by his lawyers), which was regarded as important. For example, he says, on 21 May 2015, his lawyers wrote (as explained in the affidavit of Mr Sunits):
Having access to the copies of the seized material and having time to review such material is critical to our client's readiness to proceed to a hearing in the current proceedings.
199 Further, on 13 August 2015, Mr Caratti's lawyers wrote (as explained in the affidavit of Mr Sunits):
None of the material is catalogued in any meaningful way and much of the time required to review the material is directed to cataloguing the material so that the outcomes of our review can be recorded in a way which will not only assist us in our preparation, but also will be of immense assistance to the Court at the hearing. … It is … difficult to see how a comprehensive review of the seized material is not necessary for the purposes of these proceedings.
200 Mr Caratti submits that following execution of the search warrants, there is, typically, a requirement to review what is seized for privilege, and that a difficulty that arises is identifying the purpose for which copies were created. Another difficulty that arises is the fact that a lawyer was based at the Wickham Street premises.
201 Mr Caratti says a reason for copies of seized documents being created for Mr Caratti's lawyers was to enable them, on his behalf, to commence a privilege review.
202 Mr Caratti submits the privilege review could be conducted by Mr Caratti personally or with the benefit of advice from his lawyers. A person whose lawyers conduct a privilege review needs to be a person with permission to review material. Mr Caratti was such a person. He had authority to access most of what had been seized, so no confidentiality could be breached. Authority was obtained from Hank Schokker for him and his lawyers to receive a copy which corroborates that the production of a copy to his lawyers depended on him being a person to whom such material was not confidential.
203 He adds that no such authority rested with any of the companies. At best, such authority could only have existed with respect to some of the material. The provision of the whole of the copies to Mr Caratti's lawyers corroborates, he says, that the copies were for him. In addition, he says, there is no suggestion that Wilson & Atkinson had a retainer with each of the companies whose documents may have been seized.
204 Mr Caratti also submits the evidence shows that provision of the copies to Mr Caratti's lawyers gave rise to an additional potential advantage, that his lawyers could use it to advise him on tax appeal proceedings that were underway in the AAT, or which could in the future arise concerning him or entities associated with him. It did not follow, from this potential advantage, that the copies were received on behalf of any such respective entities.
205 Mr Caratti submits he was entitled to receive the whole of the copies. The respective entities were not. The fact that copies of the whole were requested, and the fact that the copies were made available to lawyers for Mr Caratti corroborates, he says, that the copies were received for him, and not for any respective entity or entities.
206 He adds, the potential for use for tax proceedings was not the principal reason for the copies being created and received by Mr Caratti's lawyers. The documents were not used for such purpose.
207 Mr Caratti submits he was a person who, on execution of the warrants, was entitled to be present and that there were numerous bases upon which he had such entitlement. 2 Duncraig Road was his residence. As to his entitlement to be present at Wickham Street, he says he was not relevantly constrained. Indeed he claims he was relevantly an "occupier" of the premises. He says he was useful in his personal capacity to Ms Bazzo and entities associated with her, and he himself was an officer of many companies (not confined to the companies) whose affairs were administered from Wickham Street.
208 Mr Caratti contends his entitlement to occupy did not depend on his authority as a director of the companies. The provision of the copies to his lawyers was not as agent of any entity.
209 Mr Caratti submits he caused the copies to be created specifically for his lawyers, who received and retained them and used them to give confidential legal advice to him. Confidential communications between a client and the client's legal adviser are privileged, he properly submits, if made for the dominant purpose of submission to the legal adviser for advice (whether connected with litigation or not) or for use in existing or anticipated litigation. He also notes that a copy of a document created with one of these purposes as the dominant purpose, is also privileged: Commissioner of Australian Federal Police and Another v Propend Finance Pty Limited and Others (1997) 188 CLR 501; [1997] HCA 3. This proposition is also not in dispute.
210 I turn now to my findings on this question.
211 I should observe at the outset that, whether or not Mr Caratti has already used or would like to use copies of documents on the hard drives for the purpose of obtaining his own personal legal advice and therefore may be able to claim some privilege in the further use of those documents is not determinative of the issues currently before me.
212 Having carefully considered the evidence given by Mr Caratti I am not satisfied and do not accept his assertion that Wilson & Atkinson made a request pursuant to s 3N of the Crimes Act for copies of the documents seized from 48 Wickham Street on his part alone.
213 I accept the detailed submissions made by the companies and set out above at [181]-[186] in this respect and do not need here to repeat them. The points made are, in my assessment, obvious ones.
214 I consider in giving his evidence, Mr Caratti was artificially at pains throughout to do two things. One, to keep insisting that Wilson & Atkinson only ever acted for him personally in requesting documents because he was the target of the AFP investigation. The other, to the extent that he had in mind his role as a director of relevant companies, that he was only ever wanting to take steps or get advice that would enable him personally to act as a good director, but never on behalf of the companies at any relevant point in relation to the document seizure matters that arose by virtue of the execution of the warrants.
215 I do, however, accept that Mr Caratti, at material times, wished to act to protect his own personal interests. I consider the request for copies of the seized documents made by Wilson & Atkinson was, in all the circumstances, made on behalf of Mr Caratti personally but also on behalf of the companies whose documents had been seized pursuant to the warrants.
216 It is, having regard to all the facts adverted to in the submissions of the companies referred to, difficult to separate out the conduct of Mr Caratti alone, from the conduct I consider Mr Caratti engaged in on behalf of the relevant companies.
217 In circumstances where the relevant companies operated out of Wickham Street; Mr Caratti was integral to the operation of those companies out of Wickham Street; the documents of the companies were seized from Wickham Street; the relevant companies, in my judgement, were "occupiers" of Wickham Street for relevant purposes, the request made by Wilson & Atkinson, pursuant to s 3N should be taken to have been made in truth and substance, not only on behalf of Mr Caratti personally (as I accept he personally wanted the documents for his own purposes) but also on behalf of the relevant companies (because the documents were theirs and they wished to have possession of them, including so that Mr Caratti could have access to them or enable other persons, such as his lawyers, to have access to them). As I have suggested, Mr Caratti's testimony was calculated to avoid admitting the dual nature of the request made. I do not accept his testimony to that extent. I consider it implausible.
218 I should add that, while the 9 February 2015 costs agreement letter is not determinative in resolving this question, it does lend support to the view that Mr Caratti did not make the 3N request just for himself. I have set out above that I accept and find that Mr Romano sent that letter by email to the named recipients, including Mr Caratti. I have no doubt about that. Mr Caratti said that if it had been sent, he would have seen it, although he claimed he did not recall seeing the letter until these proceedings. I do not accept that that was the case. I find he saw it.
219 The consequence of that finding is, that by the default terms of the letter, Gucce Holdings was to assume the costs liability for the work done by Wilson & Atkinson in relation to the document seizure issues that lay ahead. This, in turn, tends to disclose that Wilson & Atkinson were not intended to act only for Mr Caratti. Mr Romano was familiar with acting for Mr Caratti or Ms Bazzo and companies associated with them whereby a particular entity was responsible for meeting the legal costs concerned. That, I find, was the position here - Mr Romano was acting not only for Mr Caratti, but also the relevant companies.
220 In the result, I find the 3N request made by Wilson & Atkinson, which resulted in the hard drives being provided to them, was made on behalf of both Mr Caratti personally and the relevant companies.