Baldoni & Baldoni
[2021] FedCFamC1F 289
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Baldoni & Baldoni [2021] FedCFamC1F 289
File number(s): SYC 1234 of 2019 Judgment of: KARI J Date of judgment: 13 December 2021 Catchwords: FAMILY LAW – PRACTICE AND PROCEDURE – admissibility of audio recordings – where the wife exhibited two audio recordings to her trial affidavit – where the husband raised an objection to the recordings pursuant to section 138 Evidence Act 1995 (Cth) – whether the audio recordings were obtained in contravention of an Australian law – discretion to admit audio recordings considered – probative value of the recordings considered – audio recordings excluded from evidence Legislation: Evidence Act 1995 (Cth) ss 138(1), 138 (3)
Family Law Act 1975 (Cth) ss 4AB, 79
Surveillance Devices Act 2007 (NSW) ss 7(1), 7(3)
Cases cited: Nagel & Clay [2020] FamCA 326
Nanosecond Corporation Pty Ltd v Glen Carron Pty Ltd (2018) 132 SASR 63
Parker v Comptroller-General of Customs (2009) 83 ALJR 494
Parker v Comptroller-General of Customs [2007] NSWCA 348
Rathswohl v Court [2020] NSWSC 1490
Division: Division 1 First Instance Number of paragraphs: 76 Date of hearing: 17 November 2021 Place: Adelaide Counsel for the First Applicant: Mr Lethbridge SC Solicitor for the First Applicant: Edwards Family Lawyers Counsel for the First Respondent: Mr Coleman SC Solicitor for the First Respondent: Rockliff Snelgrove Lawyers Counsel for the First Intervener: Mr Noakhtar Solicitor for the First Intervener: Somerset Ryckmans ORDERS
SYC 1234 of 2019 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS BALDONI
Applicant
AND: MR BALDONI
Respondent
MR VERTUE
Intervener
ORDER MADE BY:
KARI J
DATE OF ORDER:
13 DECEMBER 2021
THE COURT ORDERS THAT:
1.That paragraphs 78 and 81 (together with the annexures thereto) be struck out of the Trial Affidavit of the Wife filed 25 October 2021.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Baldoni & Baldoni is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
KARI J
INTRODUCTION
The proceedings relate to the division of property between the parties.
The matter was listed for trial commencing 16 November 2021 with a time estimate of five days. The trial however did not proceed for a range of reasons. The trial is now listed to commence on 4 April 2022, with a time estimate of nine days.
The parties and their legal representatives had fully prepared the matter for trial. In lieu of the trial commencing significant time was spent across two days dealing with a range of preliminary matters and rulings on the parties’ respective objections to evidence.
Of significance, for present purposes was an objection by the husband to two recordings that the wife wishes to introduce as part of her evidence in the proceedings.
These reasons shall deal with those two objections.
THE SHORT HISTORY OF THE PARTIES
The husband was born in 1963 and he is 58 years of age.
The wife was born in 1969 and she is 52 years of age.
The parties began living together in March 2015, when the husband moved to live with the wife at her property at B Street, Town C, New South Wales.
The parties married in 2015, having participated in a “symbolic” wedding ceremony in Country W in 2015.
While there is a dispute about the date of separation (either on or about 4 December 2018 or some time in January 2019), that dispute is not germane to the present issues to be determined.
The parties divorced in 2020.
There are no children of the marriage.
THE LITIGATION
The wife commenced the proceedings on 28 February 2019.
The litigation between the parties appears to have been highly acrimonious from its inception.
The level of acrimony and mutual mistrust between the parties does not appear to have abated over the duration of the litigation.
Emblematic of the level of acrimony is that each the husband and wife have filed exceedingly lengthy affidavits comprising their evidence for trial. The wife’s trial affidavit is 76 pages in length, and there are some 420 pages of annexures. The husband’s trial affidavit is 174 pages in length. He too has a significant number of annexures to that affidavit. However, because those annexures are not paginated I do not know how many pages have been filed. Suffice to observe that the bundle is significantly greater than that filed by the wife.
A significant source of disputation between the parties relates to a company known as E Pty Ltd (hereinafter referred to as “E Pty Ltd”). When the proceedings first commenced, the parties were in contest as to which of them was to ultimately retain the control and operation of the company. On 10 July 2019, Justice Berman made orders which left the husband in control of the company. However in July 2019 the company was placed into voluntary administration. This was followed by the company being placed into voluntary liquidation in September 2019.
After E Pty Ltd was placed into liquidation, the liquidator took two separate steps on behalf of the company; firstly the liquidator intervened in these proceedings, and secondly he took proceedings in the Federal Court against the husband.
However all issues in relation to E Pty Ltd were ultimately resolved by consent on 19 October 2021, with an order made quantifying the liability of the husband to E Pty Ltd in the amount of $409,728 and the liability of the wife to E Pty Ltd at $137,730.
The parties however remain in dispute about how those funds are to be paid within the context of their competing applications for orders pursuant to section 79 of the Family Law Act 1975 (Cth).
The parties are equally in dispute as to how and why E Pty Ltd ultimately went into liquidation.
In addition to E Pty Ltd, the parties also own various parcels of real property (either personally or through entities that they control), including a property situate at B Street, Town C in the state of New South Wales (hereinafter referred to as the “Town C property”) in which the parties resided for a portion of their relationship, and in which the wife has resided following the parties separation.
The Town C property was originally owned by the X Trust of which the wife advises the court, she and her former spouse were the trustees and beneficiaries. Over the course of the parties’ relationship, the wife finalised a property settlement with her former spouse, which saw her former spouse removed as a trustee, appointor and/or beneficiary of the X Trust; effectively leaving the wife in sole control of the X Trust.
During the relationship of the parties, there were a series of transactions relating to the X Trust (which was renamed the U Trust), and a related trustee company. Relevantly for present purposes however, is that the Town C property was transferred to the husband and the wife as joint tenants on or about 16 November 2018.
While there are a myriad of disputes between the parties in relation to the Town C property and the U Trust, one of the areas of significant dispute relates to how the property came to be transferred out of the U Trust. How a determination of that question is ultimately relevant to the section 79 exercise that will be the focus of the trial, remains to be seen.
Within that context the parties’ respective trial affidavits are replete with a range of very serious allegations as to the other’s poor conduct both during the relationship and in the post separation period.
Relevantly for present purposes, on the wife’s part those allegations include allegations of family violence perpetrated against her by the husband within the definition provided for in section 4AB of the Family Law Act1975 (Cth).
In the Case Outline document prepared on behalf of the wife, her Counsel has asserted that:
“the Wife leads evidence of coercive and controlling behaviour by the Husband. The relevance of that evidence in these proceedings is that, if established, the Wife relies upon it as evidence that her introduction of the Husband into the ownership of assets that she introduced into the relationship was not an exercise of her considered free will. It is to that extent only that the evidence is submitted to be relevant.[1]”
[1] Case Outline of the Wife dated 15 November 2021, page 30.
In the Case Outline document prepared on behalf of the Husband, his Counsel has promoted a number of arguments. Of relevance for present purposes is that:
(a)The husband denies the allegations of family violence.
(b)The husband denies the allegations that the wife was coerced or controlled.
(c)The husband promotes an “equitable estoppel argument in relation to the Husband acquiring 50% interest in the property …”[2]
[2] Case Outline of the Husband dated 15 November 2021, page 5.
It is against that background that the present ruling as to the admissibility of two recordings arises.
THE RECORDINGS
There are two recordings that the wife wishes to rely on. Both recordings are the subject of evidence from the wife in her trial affidavit filed 25 October 2021, and thereafter the recordings are annexed on a USB to the wife’s trial affidavit.
The first recording is an audio recording taken by the wife on or about November 2016. The wife has deposed to the circumstances of that recording in the following terms:
“78. On or about November 2016, I do not recall the precise date, I used my phone to record a conversation between me and [Mr Baldoni]. During the recording, I was in bed and [Mr Baldoni] was on his feet, walking in and out of the room, drinking straight spirits from a glass. I started the recording towards the end of what was hours of [Mr Baldoni’s] rant. I recorded the conversation by lifting my phone in front of [Mr Baldoni] while he was in the room, opening a sound-recording app and pressing the record button. I did not try to hide that I was recording [Mr Baldoni]. Throughout the recording, [Mr Baldoni] acknowledges that I am recoding and says he does not care…”
The second recording is a recording taken by the wife’s adult daughter Ms Y. The wife has deposed to the following in relation to that recording:
“81. In early 2021, on a date I do not recall, [Ms Y] said to me words to the effect:
“Mum, I recorded [Mr Baldoni] yelling at you.”
I did not know that [Ms Y] was recording the argument at the time…”
THE BASIS OF THE OBJECTION
The husband objects to the admissibility of the recordings pursuant to section 138 of the Evidence Act 1995 (Cth), which under the heading “Discretion to exclude improperly or illegally obtained evidence” provides as follows:
(1) Evidence that was obtained:
(a) improperly or in contravention of an Australian law; or
(b) in consequence of an impropriety or of a contravention of an Australian law;
is not to be admitted unless the desirability of admitting the evidence outweighs the undesirability of admitting evidence that has been obtained in the way in which the evidence was obtained.
…
(3) Without limiting the matters that the court may take into account under subsection (1), it is to take into account:
(a) the probative value of the evidence; and
(b) the importance of the evidence in the proceeding; and
(c)the nature of the relevant offence, cause of action or defence and the nature of the subject‑matter of the proceeding; and
(d) the gravity of the impropriety or contravention; and
(e)whether the impropriety or contravention was deliberate or reckless; and
(f)whether the impropriety or contravention was contrary to or inconsistent with a right of a person recognised by the International Covenant on Civil and Political Rights; and
(g)whether any other proceeding (whether or not in a court) has been or is likely to be taken in relation to the impropriety or contravention; and
(h)the difficulty (if any) of obtaining the evidence without impropriety or contravention of an Australian law.”
As identified by Justice Harper in Nagel & Clay [2020] FamCA 326, commencing at 124:
124.Section 138 is generally understood as conferring a two-step discretion. In Parker v Comptroller-General of Customs [2007] NSWCA 348; (2007) 243 ALR 574, 589-590, at [57] the NSW Court of Appeal described the two steps as follows:
The first is to determine whether evidence sought to be adduced was in fact obtained improperly or unlawfully in one of the senses identified in pars (a) and (b). The second step is to consider whether despite that conclusion, the discretionary considerations favour its admission.
125.In the same passage, the NSW Court of Appeal also pointed out the qualified proscription in s 138(1), that the evidence “is not to be admitted unless...” it reflects the importance of giving appropriate weight to the effect of any impropriety or unlawfulness.
126.It seems to be well settled that the party seeking exclusion of evidence under s 138 bears the onus of first establishing it was illegally or improperly obtained, while the party seeking admission bears the burden of proving matters weighing in favour of admission and that the desirability of admitting the evidence outweighs the undesirability of admitting the evidence that has been obtained in the “way in which it was obtained.”: Parker v Comptroller-General of Customs (2009) 83 ALJR 494; [2009] HCA 7 at [28].
The husband asserts that both recordings were obtained improperly in contravention of the Surveillance Devices Act 2007 (NSW) (hereinafter referred to as “the SDA”), as the “recordings were done without his knowledge and/or consent and were not reasonably necessary for the protection of a lawful interest and therefore they are inadmissible.”[3]
[3] Case Outline of the Husband filed 15 November 2021, paragraph 10.
Relevantly, the SDA provides as follows:
7. Prohibition on installation, use and maintenance of listening devices
(1) A person must now knowingly install, use or cause to be used or maintain a listening device-
(a) to overhear, record, monitor or listen to a private conversation to which the person is not a party, or
(b) to record a private conversation to which the person is a party
…
(3) Subsection (1)(b) does not apply to the use of a listening device by a party to a private conversation if-
(a)all of the principal parties to the conversation consent, expressly or impliedly, to the listening device being so used, or
(b)a principal party to the conversation consents to the listening device being so used and he recording of the conversation-
(i)is reasonably necessary for the protection of the lawful interests of that principal party
…
A “listening device” is defined in section 4 of the SDA as:
“…any device capable of being used to overhear, record, monitor or listen to a conversation or words spoken to or by any person in conversation, but does not include a hearing aid or similar device used by a person with impaired hearing to overcome the impairment and permit that person to hear only sounds ordinarily audible to the human ear.”
DISCUSSION - THE FIRST RECORDING
As identified by Justice Harper in Nagel & Clay[4], the first question to be answered is whether the recording was obtained unlawfully.
[4][2020] FamCA 326
Turning to the provisions of the SDA, there does not appear to be any dispute that the mobile telephone upon which the wife took the recording, falls within the definition of a listening device.
The more pertinent question is whether the recording itself was obtained in contravention of an Australian law, and in particular section 7(1) of the SDA.
In her defence, the wife’s Counsel asserted that the recording was not obtained in contravention of section 7(1) of the SDA, as the husband had expressly consented to the recording, and thus the provisions of section 7(3)(a) of the SDA applied.
The wife herself, at paragraph 78 of her affidavit as previously identified deposed “…Throughout the recording, [Mr Baldoni] acknowledges that I am recording and says he does not care…”
During the hearing on 17 November 2021 the court did not have the benefit of either the recording or a transcript of the recording beyond that set out in paragraph 78 of the wife’s affidavit as previously set out herein. However counsel for each of the parties invited the court to listen to the recording before ruling.
Counsel for the wife pressed the necessity of the court listening to the recording because at approximately the 11 minute and 40 second mark of the recording, the husband is alleged to have said the words “Go on. Record it all. I don’t give a shit”.
While the husband’s counsel acknowledged that those very words were spoken by the husband, it was submitted that when the words were considered in the context of the entire recording, the words do not amount to the husband’s consent.
During the period of adjournment the solicitors for the wife with the consent of the husband made arrangements for a copy of the recording to be provided to the Court.
The opportunity to listen to the recording has been beneficial. The recording itself is of some 16 minutes and 40 seconds in duration. On my observation while some of the words spoken by the husband during the recording are derogatory and offensive in the extreme, to use the words of the husband’s counsel, it appears to be a recording of a “domestic dispute”.
Having heard the entirety of the recording, I accept the submissions made on behalf of the husband that the words “Go on. Record it all. I don’t give a shit”, do not amount to the husband’s express consent. I have formed that view because it is not apparent that at any time before the 11 minute and 43 second mark, when those words were spoken by the husband, that the husband had any understanding that the wife was making the recording. Nor is there anything in the recording up to that point which makes it clear that the wife had alerted the husband to the fact that she was recording and that the husband either expressly or impliedly consented to the recording. Indeed, because some of the recording is muffled and inaudible, I consider that it is not unsafe to infer that the recording was surreptitious at least in the initial stages.
Moreover, aside from the one mention at the 11 minute and 43 second mark, there is nothing in the recording that confirms those matters asserted by the wife at paragraph 78 of her affidavit that the husband “throughout the recording” acknowledged that the wife was recording and stated he did not care.
Having formed the view that the recording was obtained without the husband’s consent, the next question to determine is whether section 7(3)(b)(i) of the SDA applies; namely whether the recording was made to protect the wife’s lawful interests.
The husband’s Counsel referred the court to the decision of Rees J in Rathswohl v Court [2020] NSWSC 1490. In that decision, her Honour reviewed decisions from a range of jurisdictions to illuminate those circumstances that might amount to a recording being “reasonably necessary for the protection of the lawful interests” of the person making the recording.
Her Honour referred to the decision of Doyle J in Nanosecond Corporation Pty Ltd v Glen Carron Pty Ltd (2018) 132 SASR 63 [at 101] to observe that “… the issue of whether a recording was made for the protection of a person’s lawful interest remains one very much anchored in the facts of the particular case.”
Helpfully however, her Honour concluded [at 35]:
The following considerations may indicate whether recording a private conversation without consent may be “reasonably necessary for the protection of the lawful interests” of the person making the recording.
(a)Whether the purpose of the conversation was to obtain admissions in support of a legitimate purpose. The contentious subject matter of the conversation, or the characteristics of the person being recorded, may indicate that it was necessary to make the recording in order to secure the admission. Recording a conversation for the purpose of extracting money, inducing further improper conduct or to blackmail the recorded party will indicate to the contrary.
(b)Whether it was important to protect oneself from being accused of fabricating a conversation and recording the conversation was the only practical means of refuting such an allegation. This is more likely to be the case where the conversation concerns a serious criminal matter or the principal party has a genuine concern for their safety or that of their children.
(c)Whether there were other practical means of recording the conversation, for example, reporting the matter to police or making a contemporaneous file note.
(d)Whether there was a serious dispute on foot between the parties, including where determination of the dispute would vitally depend upon oral evidence and thus, one person’s word against another. Recordings of conversations ‘just in case’ there is a dispute, or for the sake of making an accurate record of what was said, is not enough.
Against the backdrop of those considerations, Counsel for the husband asserted that the recording did not comfortably fall within any of the indicia identified by Rees J. Rather, it is the husband’s case that the wife made the recording “just in case” it might turn out to be useful at some future point in time. Counsel submitted, “recordings of conversations just in case there is a dispute, or for the sake of making an accurate record of what was said is not enough.”
Again, those are submissions with which I agree for the following reasons:
(a)There does not appear to be any discernible reason for the wife to have made the recording at the point in time that she did.
(b)There is nothing about the recording which suggests that the wife was concerned or had a cause for concern for her safety at the time of the recording.
(c)The recording was made in November 2016, at a relatively early point in the parties’ relationship. At that juncture, while the parties may have had domestic disagreements about a range of topics, there was no suggestion that there was any real and identifiable concern about the imminent potential for significant harm or the potential for harm to the legal interests of the wife.
(d)The wife has not identified, beyond the allegation of family violence, why the issues discussed between the parties in the recording or the circumstances that resulted in the recording, recording necessitated the wife making the recording at the time that she did so.
(e)While the allegations of family violence are not to be taken lightly, it is not insignificant that the wife appears to have done nothing with the recording in the years that followed. In particular, the wife has not asserted that the recording was taken by her to the police at any point in time to make a report that she had been the victim of family violence. In addition, the recording has not surfaced at any point in this litigation until the final stages of the proceedings. Rather it would appear that the recording has remained idle until the last moment when the wife filed her material for trial.
Having determined that the recording was unlawfully obtained, consideration must now turn to whether there are factors that weigh in favour of admitting the recording despite it having been unlawfully obtained.
At the wife’s end submissions were made as to the relevance of the recording in the context of the wife’s assertions as to the coercive and controlling nature of the parties’ relationship. This submission as to the relevance of the recording is accepted in the context of these proceedings, where the nature of the parties relationship is one which the court may be asked to consider when understanding why certain transactions and events took place over the course of the parties relationship.
However, as identified by Justice Harper in Nagel and Clay[5] [at 105 - 106]:
105. While relevance will dictate admissibility, it is also necessary to consider the probative value and importance of the recordings where the issue of possible exclusion has been raised. In the Dictionary to the Evidence Act, “probative value” is defined to mean “the extent to which the evidence could rationally affect the assessment of the probability of the existence of a fact in issue”. This definition obviously overlaps with the definition of relevance. It must be assumed that those parts of the recordings which are relevant are also not devoid of any probative value. But the degree of their probative value is a different question. In IMM at [45] the High Court pointed out the definition of “probative value” and in particular the word “extent” recognise relevant evidence can rationally affect the assessment of the relevant probability to different degrees.
106. The importance of the recordings in the proceedings must also be considered. While separate concepts, probative value and importance are closely related. The High Court has recently pointed out, in the context of discussing s 138 of the Evidence Act, that evidence may possess high probative value but not be important in the proceeding in a case in which other equally probative evidence is available: Kadir v The Queen; Grech v The Queen [2020] HCA 1; (2020) 375 ALR 80 at [42]. On the other hand, it may be said that limited probative value may also lead to the conclusion that evidence has low importance in the proceedings.
[5] [2020] FamCA 326
As I have identified earlier in these reasons, the trial affidavits of each of the parties are extensive. Rulings were made at the hearing on 17 November 2021 as to the admissibility of vast portions of the wife’s trial affidavit. Amongst those portions of the wife’s evidence to which objection was taken by the husband, were those portions in the affidavit material that deal with the topic of family violence. In the main, those objections by the husband were dismissed. As a result, there is now considerable evidence before the court on this topic.
In that context, if the issue of the existence of family violence is to be traversed at trial, the usual process of hearing the parties competing evidence and making findings (if necessary) as to the existence of family violence will occur.
The recording in question is one piece of the voluminous material that the wife relies upon to make out her case as to the existence of family violence. In circumstances where the husband denies the existence of family violence, the recording may well have some probative value. However, I consider that probative value to be low in the context of all of the evidence before the court in this particular case.
Accordingly, I do not consider that the desirability of admitting the evidence outweighs the unlawful manner in which the evidence was obtained.
DISCUSSION – THE SECOND RECORDING
In addition to the objection taken pursuant to section 138 of the Evidence Act 1995 (Cth), the husband takes a further objection to the admissibility of the second recording. This objection is taken because of the manner in which the recording is put before the court. In particular, the husband asserts that the recording is inadmissible as it is hearsay, as the person who is alleged to have taken the recording is not the person who has sworn an affidavit putting the recording before the court. Indeed, the wife’s daughter Ms Y is not a person that has filed any affidavit in these proceedings and she has not to date been promoted as a witness on behalf of the wife.
This is a submission which the mother’s Counsel did not cavil against; acknowledging that the proper vehicle for putting the recording before the court should have been an affidavit sworn by the wife’s daughter Ms Y. The wife’s Counsel went so far as to suggest that the situation should now be remedied by having an affidavit sworn by Ms Y.
However in my view a retrospective attempt by the wife to rectify the manner in which the second recording has been put before the court, does not provide a sufficient remedy. Particularly when regard is had to the extensive material that has already been filed by the wife together with the fact that there had been a precise filing regime set by the court.
This reason alone is sufficient in my view to uphold the husband’s objection in relation to the second recording.
That being said, it is still important to give consideration to the main basis for objection, being section 138 of the Evidence Act 1995 (Cth).
Turning to the first question of whether the recording was unlawfully obtained. It has not been identified how the wife’s daughter Ms Y made the recording. Be that as it may, I will assume for present purposes that by virtue of the fact that a recording exists from a conversation between the parties, to which Ms Y was not a party, the recording was taken on a listening device falling within the definition provided for in the SDA.
On any view, the existence of the recording comfortably fits within a breach of section 7(1)(a) of the SDA.
In addition, in circumstances where the date of the recording has not been identified, coupled with the fact that the wife did not know about the recording until some time in early 2021, and the husband presumably did not know about the recording until some time thereafter, it is impossible to conceive a circumstance in which there has been express or implied consent by either the husband or the wife to the taking of the recording. Accordingly the exception provided for in section 7(3)(a) of the SDA does not apply.
Equally, section 7(3)(b) of the SDA does not apply, as Ms Y was not a principal party to the conversation within the definition ascribed to the words “principal party” in section 4 of the SDA, which provides “… a person by or to whom words are spoken in the course of the conversation.”
In circumstances where I am satisfied that the recording by Ms Y was unlawfully obtained, consideration must be given to whether the recording is admissible within the provisions of s138 of the Evidence Act 1995 (Cth).
Unlike the first recording, the parties did not invite the court to listen to the second recording, and nor has a transcript of the recording been provided to the court. As a result, it is impossible to form any opinion as to whether there is any proper basis to conclude that there is sufficient probative value to the recording such that the desirability of admitting the recording outweighs the illicit nature in which the recording has been obtained.
In addition, the absence of any cogent submissions being put as to the probative value of the recording, is fatal to the admissibility question.
For all of the reasons I have enunciated, I now make those orders that appear at the commencement of these reasons.
I certify that the preceding seventy-six (76) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Kari. Associate:
Dated: 13 December 2021
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