Balding v Ten Talents Pty Ltd and Anor (No.2)

[2007] FMCA 161

FEDERAL MAGISTRATES COURT OF AUSTRALIA

BALDING v TEN TALENTS PTY LTD & ANOR (No.2) [2007] FMCA 161

INDUSTRIAL LAW – PRACTICE AND PROCEDURE – Setting aside – relevance – whether subpoena circumventing discovery grounds for setting aside.

EVIDENCE – Relevance.

Evidence Act 1995 (Cth), ss.55 ,56
Federal Magistrates Act 1999 (Cth), s.45(1)
Federal Magistrates Court Rules 2001 (Cth), rr.1.03(2)and(4), 14.02(1) and 15.13(1)(a)
Workplace Relations Act 1996 (Cth), ss.400(5) and 728(1) and (2)

Balding v Ten Talents Pty Ltd & Anor (No.1) [2007] FMCA 145
Bartucciotto v Western Health Care (2007) FMCA 26
Genovese v BGC Constructions (2006) FMCA 1507
Harrington Smith on behalf of the Wongatha People v State of Western Australia (2003) FCA 893
Mandic v Phillis (2005) FCA 1279
Martin v Osborne (1936) 55 CLR 367
National Employers’ Mutual General Insurance Association Ltd v Waind & Hill (1978) 1 NSWLR 372

Applicant: GAYLE NAOMI BALDING

First Respondent

Second Respondent

TEN TALENTS PTY LTD (ACN 121 450 333)

CYBERLINK PTY LTD (CAN 082 280 037)

File number: PEG 253 of 2006

Judgment of: Lucev FM

Hearing date: 16 February 2007

Date of last submission: 16 February 2007

Delivered at: Perth

Delivered on: 20 February 2007

REPRESENTATION

Counsel for the Applicant: Ms G Archer

Solicitors for the Applicant: Blake Dawson Waldron

Counsel for the Second Respondent: Mr T Caspersz

Solicitors for the Second Respondent: CCI Legal

ORDERS

The Court orders that:

1. Paras 1(a)(ii)(C), (b)(iv), (c)(iii) and (d)(iii), 2(iii), 3(iii) and 4 of the subpoena to the Proper Officer, Cyberlink Pty Ltd (ACN 082 280 037) issued on 9 November 2006 be set aside.

2. The Court will hear the parties as to costs, if any.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
PERTH

PEG 253 of 2006

GAYLE NAOMI BALDING

Applicant

And

TEN TALENTS PTY LTD

First Respondent

CYBERLINK PTY LTD

Second Respondent

REASONS FOR JUDGMENT

(Varied under Rule 16.05(1) of FMC Rules)

Application to set aside subpoena

1. The Second Respondent has applied to the court to set aside a subpoena to produce documents dated 9 November 2006 directed to the Proper Officer of the Second Respondent

Substantive application

1. The substantive application seeks orders concerning an alleged contravention of s.400(5) of the Workplace Relations Act 1998 (Cth) (“WR Act”) by the First Respondent, in which contravention the Second Respondent is said to be “involved” for the purposes of s.728 of the WR Act.

Argument

1. The Second Respondent argues that a subpoena may be set aside if it is not used for a legitimate forensic purpose, and in this regard, asserts that the documents sought to be produced:

   (a)must have apparent relevance to the matters in issue; and

   (b)should not be used as a substitute for discovery.

2. In relation to relevance the  Second Respondent argues that:

   (a)to the extent that the subpoena is in respect to employees other than King and Franklin then the documents requested are not of apparent relevance;

   (b)that there is no issue that the Second Respondent acted for and on behalf of the First Respondent and therefore the documents identified in paras1(a), (b) and 4 of the subpoena are of no apparent relevance; and

   (c)the documents identified in paragraph 1(d) are not of apparent relevance because Action Supermarkets Pty Ltd is not a party to the proceedings.

3. The Second Respondent also objects to the subpoena on the basis that, if the documents are relevant, then the documents would be discoverable, that no declaration for discovery has been made in this matter, therefore the subpoena should be set aside as an abuse of process.

4. At the hearing of the application Counsel for the Second Respondent also objected to the subpoena in relation to paragraphs 2(i) and (ii) and 3(i) and (ii) on the basis that the First Respondent was already in possession of the relevant documents.

5. The Applicant says that there is a legitimate forensic purpose for seeking production of the subpoenaed documents.

6. The Applicant says that regard must be had to the factual context in determining the primary issue, namely, whether Franklin and King were subject to duress in connection with the offer of an Australian Workplace Agreement (“AWA”).

7. The Applicant says that the factual context includes the offers made to Franklin and King and:

   (a)whether offers were for their existing positions;

   (b)whether the offers were conditional upon signing an AWA;

   (c)whether there was opportunity to negotiate another form of industrial instrument; and

   (d)whether other employment options were considered prior to their having to make a decision concerning the AWA, including options such as redundancy or transfer.

8. The Applicant also says that the circumstances of the interviews and the state of mind, including knowledge, of Franklin and King must be considered.

9. The Applicant says that the situation of other employees may be relevant in determining whether or not the Court accepts the evidence of Franklin and King.  It might also assist in determining whether (and in particular, together with documents sought to be produced under the subpoenas it relates to documents concerning Action Supermarkets) whether there was a particular plan in relation to the AWA offers, from which other inferences might be drawn.  The factual context might also include, according to the Applicant, the following:

   (a)The “involvement” (for the purposes of s.728 of the WR Act) of the Second Respondent, that involvement being more than whether the Second Respondent merely acted for an on behalf of the First Respondent;

   (b)The relationship between Action Supermarkets (and related entities) and the First Respondent; and

   (c)Whether there was a transmission of business, and therefore whether the employees were essentially being offered, their existing jobs.

10. The Applicant asserts that the subpoena for production is not a substitute for discovery.  The Applicant points out that the Second Respondent has not asserted that the subpoena requires the person concerned to make a judgment as to which documents relate to issues between the parties, and that there is therefore no basis for the objection.

Relevance – generally

1. Section 55 of the Evidence Act1995 (Cth) (“the Evidence Act”) deals with relevant evidence, and provides as follows:

   “(1)   The evidence that is relevant in a proceeding is evidence that, if it were accepted, could rationally affect (directly or indirectly) the assessment of the probability of the existence of a fact in issue in the proceeding. 

   (2)     In particular, evidence is not taken to be irrelevant only because it relates only to:

   (a)     the credibility of a witness; or

   (b)     the admissibility of other evidence; or

   (c) a failure to adduce evidence.”

2. If evidence is not relevant, it is not admissible in a proceeding: Evidence Act s.56(2). Relevant evidence is admissible, except as otherwise provided by the Evidence Act: Evidence Act, s.56(1).

3. It has been said that, “one fact is relevant to another if it bears on the probability that another fact, the one to be proved, does or does not exist”: Roberts, Evidence. Proof and Practice (Sydney: Law Book Company, 1998). A broad interpretation of relevance is dictated by the words used in s. 55(1) of the Evidence Act.  It includes evidence which “could … indirectly” affect an assessment of probability, provided that there is a rational connection between the evidence and facts in issue: Odgers, Uniform Evidence Law (7^th ed) (Sydney: Law Book Company, 2006) pp 168-170.  Whether a rational connection exists requires an objective assessment, having regard to basic human experience: Harrington-Smith on behalf of theWongatha People v State of Western Australia(No.7) [2003] FCA 893 at para 11 per Lindgren J, or “the common course of events” or “common course of human affairs” as it was put respectively by Stephen and Dixon J: see Stephen, Digest to the Law of Evidence (4^th ed) (MacMillan & Co: London, 1893) p.2 and Martin v  Osborne (1936) 55 CLR 367 at 375 per Dixon J.

4. Ultimately therefore evidence will be relevant for the purposes of the proceedings in this matter when, if accepted, it could directly or indirectly rationally affect the assessment of the probability of the existence of duress, or the application of duress, for the purposes of section 400(5) of the WR Act. Evidence might also be relevant if it were accepted and could directly or indirectly rationally affect the assessment of the probability of the existence of the “involvement” of the Second Respondent in a contravention of s.400(5) of the WR Act, see s.728(1) of the WR Act.

5. In Balding v Ten Talents Pty Ltd & Anor [2007] FMCA 145 (“Ten Talents [No. 1]”) the Court defined duress: Ten Talents [No 1] at paras 33-35 per Lucev FM, and set out facts relevant to a consideration whether duress had been applied: Ten Talents [No 1.] at paras 36-58 per Lucev FM.  The Court adopts, without repeating, what was said in the passages cited from Ten Talents [No 1.].

Relevance – objections to specific paragraphs

1. In relation to paras 1(a) and (b) and 4 of the subpoena, the Second Respondent specifically objected on the basis that they have no relevance because there is no issue that the Second Respondent acted for an on behalf of the First Respondent. However, as the Court discussed with Counsel for the Second Respondent in the course of argument, this objection does not relate to the “fact in issue” for the purposes of s.55(1) of the Evidence Act. The fact in issue here is whether the Second Respondent was “involved in” the alleged contravention of s.400(5) of the WR Act, that is, the application of duress, by a means specified in s.728 (2) of the WR Act.  In this case the Applicant asserts that the Second Respondent was “involved in” the application of duress by the following means under s.728(2):

   (a)by aiding, abetting, counselling or procuring the contravention; s.728(2)(a);

   (b)by being knowingly concerned in any way, either by act or omission, either directly or indirectly; s.728(2)(c); and

   (c)conspiring to effect a contravention: s.728(2)(d).

2. The fact in issue goes not to whether the Second Respondent acted for or on behalf of the First Respondent (there is no dispute about that), but how the Second Respondent acted or conducted itself in relation to the fact in issue having particular regard to the factors for consideration in determining whether there has been the application of duress, as these factors were outlined in Ten Talents (No.1). How the Second Respondent so acted or conducted itself is critically relevant to an assessment of whether duress was applied.  The objection in relation to paras 1 (a) and (b) fails (save as dealt with below concerning “Employees”).  It also fails, on this basis, in relation to para 4, but subject to what is said below concerning para 4.

3. No specific objection was made to para 1(c) save as to “Employees” which is dealt with below.

4. The Second Respondent objects to para 1(d) of the subpoena on the basis of no apparent relevance because Action Supermarkets is not a party to proceedings.  However, the Second Respondent is, and what is sought are documents in relation to discussions, representations, offers or assistance provided to Action Supermarkets by the Second Respondent (acting on behalf of the First Respondent) in relation to the offering of AWA’s.  Any documents of this type might be relevant to an assessment of the probability of the application of duress, and the involvement of the Second Respondent in the application of duress, particularly as it relates to:

   (a)whether the First and Second Respondents discussed with Action Supermarkets how they intended to proceed with the offering of AWA’s; and

   (b)the question of transmission of business, and if there might have been a transmission of business absent the offering of AWA’s, and if there had been a transmission of business whether Franklin and King would have been entitled to their existing positions, and existing terms and conditions: see Ten Talents [No 1.] at paras 43-49 per Lucev FM.  The objection to para 1(d) therefore fails (save as to “Employees” which is dealt with below).

5. The Second Respondent objects to paras 2 and 3 because it is said that the relevant documents are already in the possession of the Applicant as a consequence of the response to a Notice to Produce.  No evidence of a Notice to Produce was provided nor was there evidence of what was produced provided by the Second Respondent.  In response to the submission from the bar table by counsel for the Second Respondent, Counsel for the Applicant informed me that the Notice to Produce was directed to the First Respondent, and was therefore irrelevant to the Second Respondent.  Paras 1 and 3 seek production of relevant documents and the objection fails.

“Employees”

1. The Second Respondent further to objected to paragraph 4 by reason of it being too broad or that it was lacking in specificity.  Para 4 is not limited to documents relating to King, Franklin or Employees, as are most of the other paragraphs.  Nor does it specifically relate to the IGA Hilton store or services provided in connection with that store.  On its face it might also apply to services provided which have absolutely no connection with the offering of AWA’s, whether to King, Franklin or any other Employees.  In the circumstances, para 4 is too broadly framed, and lacks the relevant specificity, to make it relevant to their application before the Court.  Para 4 will be set aside.

Relevance – Employees

1. The Second Respondent asserts that the subpoena for production of documents as it relates to “any of the Employees” is of no apparent relevance as there is no issue raised with respect to any employees of Action Supermarkets, other than Franklin and King.  The reference to “Employees” is a reference to the following definition in para 1(a)(ii)(C) of the subpoena:

   “any employees, or former employees, or a number of employees and/or former employees of Action Supermarkets, employed by Action Supermarkets during 2006 (the Employees).”

2. This definition captures all employees of Action Supermarkets employed anywhere: it does not relate to specifically to the IGA Hilton Supermarket or to former employees of Action Supermarkets offered ongoing employment at the IGA Hilton Supermarket on the basis of AWA’s.  By reason of its lack of specificity, the definition is too broad and is not relevant to the fact in issue in these proceedings.  Thus, paras 1(a)(ii)(C), (b)(iv), (c)(iii) and (d)(iii), 2(iii) and 3(iii) must be set aside.

Subpoenas circumventing discovery

1. The Court agrees with the submissions by Counsel for the Applicant in relation to this issue.  A subpoena issued in an attempt to obtain discovery is likely to be set aside as an abuse of process: see Mandic v Phillis [2005] FCA 1279 at para 33 per Conti J, and cases there cited. In relation to those paras of the subpoena that have not been set aside it is not the case that the person to whom they are addressed will have to make a judgment as to which documents relate to issues between the parties. In those circumstances, the Court does not consider that the subpoena is the equivalent of an application for discovery, and this ground must fail: see National Employers’ Mutual General Insurance Association Ltd v Waind & Hill [1978] 1 NSWLR 372.

2. The Court also considers that circumvention of discovery might not be a ground for setting aside a subpoena in a jurisdiction where discovery is not ordinarily granted, and requires a declaration that it is in the interests of the administration of justice before such a declaration is granted: Federal Magistrates Act 1999 (Cth), s.45(1) (“FM Act”); because consideration of the interests of the administration of justice import case management considerations such as cost and convenience for hearing and determination, earlier hearing of proceedings, availability of particular proceedings and any pending proceedings in another court.  In the “interests of the administration of justice” is “directed to the consideration of the interests of the management of justice, which must mean management by the Court of the proceedings pending before the Court”: Genovese v BGC Constructions [2006] FMCA 1507 at para 28, also paras 24-26 per Lucev FM; see also Bartucciotto v Western Health Carte & Ors [2007] FMCA 26 at paras 25-27 per Lucev FM. In the context of the Federal Magistrates Court Rules 2001 (Cth) (“FMC Rules”) which aim to help the Court use streamline processes, and which the parties must avoid undue delay, expense and technicality: FMC Rules r.1.03(2)&(4), and where a subpoena for production is specifically provided for: r.15.13(1)(a), and where discovery is very much the exception, it seems that traditional rules with respect to the setting aside of subpoenas which seek to circumvent discovery might have little no application. In the circumstances of this case, it is the Courts view that they have no application. For that reason also, this ground must fail.

Orders

1. The Court orders that paras 1(a)(ii)(C), (b)(iv), (c)(iii) and (d)(iii), 2(iii), 3(iii) and 4 of the subpoena to the Proper Officer, Cyberlink Pty Ltd (ACN 082 280 037) issued on 9 November 2006 be set aside.

2. The Court will hear the parties as to costs, if any.

I certify that the preceding twenty-nine (29) paragraphs are a true copy of the reasons for judgment of Lucev FM

Associate:  M Hewitt

Date:  20February 2007