Abdul Zreika sues Doonya El Haddad for damages arising out of a motor vehicle accident. Ms El Haddad's insurer, on its application, was previously joined to the proceedings. It issued a subpoena to Optus Mobile Pty Ltd seeking the mobile phone records of Mr Zreika showing incoming and outgoing calls and texts for the two weeks surrounding the date of the accident. Mr Zreika seeks to set aside the subpoena.
[2]
THE ISSUE
The sole issue on the application is whether there is a legitimate forensic purpose in the issue of the subpoena.
[3]
BACKGROUND
After being given notice of the claim, the insurer acting for Ms El Haddad admitted liability. However, for reasons not revealed on this application, it withdrew or purported to withdraw that admission. Mr Zreika commenced proceedings.
Under s 119 of the Motor Accidents Compensation Act 1999, the insurer may apply to be joined as a party if the insurer "has given the plaintiff particulars alleging that the claim has not been made in good faith". The insurer successfully applied under s 119 and became the second defendant. I asked the insurer whether the particulars requirement in s 119 had been satisfied and whether I could see the particulars. The insurer identified a document in evidence that it said constituted the particulars. The document read as follows:
"18 February 2016
…
As a result of information received since notice was given under Section 81 of admission of liability, we allege that the claim falls within Clause 8.11.6 of the Claims Assessment Guidelines, namely that it is a claim which is fraudulent in terms of the circumstances of the accident giving rise to the claim.
We allege that the accident was staged by your client for purposes of financial gain. Any proceedings which are commenced will be defended on that basis and on the basis that, in the circumstances, no duty was owed to your client.
It follows that we also allege the claim is false within the meaning of Section 117 of the Motor Accidents Compensation Act. We refer you also to the provisions of Section 118.
We also give notice that in the event that proceedings are commenced an application will be made to the Court for separate representation pursuant to Section 119 of the Motor Accidents Compensation Act".
The amended statement of claim pleads a claim for damages in a conventional form. The insurer's defence consists largely of non-admissions and denials, and it makes no reference to fraud, dishonesty, a fraudulent claim or a staged accident. It also alleges contributory negligence by Mr Zreika including by, "Moving into the path of an oncoming vehicle", "Failure to ensure that his presence on the roadway was known to the First Defendant", and "Failure to warn the First Defendant of his intention to pull out from the kerb in her [the first defendant's] path". The final particular states, "Intentionally attempting to be hit by the First Defendant".
In support of the subpoena, the insurer relied upon an expert report of a "collision expert", who concluded that Mr Zreika's car was stationary at the moment of impact and that his movement "would not have led to…injury to his right shoulder". Injury to the plaintiff's right shoulder is a particular of injury in the amended statement of claim. Although dated 17 March 2017, the expert report was only provided to the plaintiff at the commencement of the application. I allowed it into evidence for the limited purpose of establishing that the insurer had material indicating the matters mentioned above about the vehicle being stationary at impact and the movement not causing injury to the right shoulder.
[4]
LEGAL PRINCIPLES
Whether there is a legitimate forensic purpose in the issue of the subpoena depends on whether 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" (see ICAP Australia Pty Ltd v BGC Partners (Australia) Pty Ltd [2009] NSWCA 307 at [9] and [21], North Shore Real Estate Pty Ltd v Real Estate Property Management Services Pty Ltd [2017] NSWDC 44 at [15]). As Dicker SC DCJ said in the latter decision at [15]:
"The word 'likely' in this statement of principle does not mean more likely than not but means 'on the cards' or something beyond mere speculation or a fishing expedition".
See also ICAP at [23] and [25].
Whether a matter is an "identified issue" appears from the pleadings, affidavits and legal principles which govern the claims for relief in the substantive proceedings (see Portal Software v Bodsworth [2005] NSWSC 1115 at [24] and [25]).
[5]
ANALYSIS
Leaving aside the reference to the contributory negligence particular of intentional conduct, there is no allegation in the pleadings of dishonesty or a fraudulent claim. The insurer did not rely in this application on any purported particulars of lack of good faith contained in the letter of 18 February 2016 notwithstanding that the document containing the particulars was a pre‑condition to the joinder of the insurer. Indeed the insurer sought to distance itself from that document and indicated that the document was prepared without legal advice.
The evidence of the collision expert does challenge some aspects of the amended statement of claim, but does not, in any respect, indicate any fraudulent claim by Mr Zreika.
That leaves the reference to the contributory negligence particular involving the intentional conduct of the plaintiff. It is not at all clear what this particular, "Intentionally attempting to be hit by the First Defendant", is meant to refer to, or that it indicates a fraudulent claim, especially since the plaintiff's car is alleged by the insurer's expert to be stationary at the point of impact. Were the particular to indicate a fraudulent claim, it is difficult to see why it is a particular of contributory negligence.
The insurer referred to the decision of Lowery v Insurance Australia Ltd [2015] NSWCA 303, including amongst other things to the reference to "reasonable suspicions" in paragraph 52, see also paragraph 41. I asked if the insurer had a suspicion of a staged accident or a fraudulent claim, or any other suspicion of dishonesty, but so far as the insurer responded to my enquiry, no matters grounding such a suspicion were identified.
In the absence of some assertion of a fraudulent claim or a staged accident, it is difficult to see the relevance of Mr Zreika's phone calls. There is no reasonable basis to conclude that the documents recording those phone calls would likely assist. On the material before me, it is not "on the cards". Rather, because of the absence of an allegation in the statement of claim or in correspondence now relied upon and because of the absence of any particulars of fraud or any suspicion, let alone a reasonable suspicion, of some form of dishonesty, and because of the absence of any basis for a suspicion, I am satisfied that the subpoena is a mere fishing expedition by the insurer, perhaps hoping, without any identified foundation, that the plaintiff's phone records may contain something inculpatory. That is not enough to support the subpoena (see Lowery at [42]).
The Court proposes to order that the subpoena be set aside and the insurer pay the costs of the application.
[6]
COSTS
The plaintiff has sought a special order for indemnity costs of the application payable forthwith. Although the insurer's application was unsuccessful, neither its lack of success nor the extent of the lack of merit of the application, is sufficient to warrant a special costs order. No other reason was identified. I do not propose to amend the orders I have proposed, and the plaintiff's application for an indemnity costs order paid forthwith is refused.
The orders of the Court are:
1. Set aside the subpoena to Optus Mobile Pty Ltd filed 29 March 2017.
2. The second defendant pay the plaintiff's costs of the notice of motion.
3. The plaintiff's application for an indemnity costs order paid forthwith is refused.
[7]
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Decision last updated: 26 February 2018