Clifton & Aspen (No 3)
[2023] FedCFamC1F 645
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Clifton & Aspen (No 3) [2023] FedCFamC1F 645
File number(s): SYC 760 of 2021 Judgment of: ALDRIDGE J Date of judgment: 3 August 2023 Catchwords: FAMILY LAW – PRACTICE & PROCEDURE – Where the wife seeks leave to issue a number of subpoenas to which the respondents object – Where the parties have filed written submissions as to the proposed content of them prior to their issue – Relevance – Fishing expedition – Where there is merit in limiting the subpoenas – Where the wife is otherwise granted leave to issue the subpoenas subject to those limitations – Costs reserved. Cases cited: Associated Dominions Assurance Society Pty Ltd v John Fairfax & Sons Pty Ltd (1955) 72 WN (NSW) 250
Clifton & Aspen [2023] FedCFamC1F 376
Clifton & Aspen (No 2) [2023] FedCFamC1F 594
Commissioner for Railways v Small (1938) 38 SR (NSW) 564
Xinfeng Australia International Investment Pty Ltd v GR Capital Group Pty Ltd [2020] NSWSC 620
Division: Division 1 First Instance Number of paragraphs: 41 Date of last submissions: 25 July 2023 Date of hearing: 11 July 2023 Place: Sydney Counsel for the Applicant: Mr Sirtes SC with Mr Auld Solicitor for the Applicant: Delaney Lawyers Counsel for the First Respondent: Mr Hollo Solicitor for the First Respondent: Pearson Emerson Counsel for the Second and Third Respondents: Mr Sulan SC with Ms Jeliba Solicitor for the Second and Third Respondents: Barkus Doolan Winning ORDERS
SYC 760 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS CLIFTON
Applicant
AND: MR B ASPEN
First Respondent
D PTY LTD
Second Respondent
MR C ASPEN
Third Respondent
ORDER MADE BY:
ALDRIDGE J
DATE OF ORDER:
3 AUGUST 2023
THE COURT ORDERS THAT:
1.Leave is granted to the wife to issue a subpoena to Australia and New Zealand Banking Group Ltd in the form already provided to the Court.
2.Leave is granted to the wife to issue a subpoena to RR Lawyers, EE Pty Ltd, EE3 Pty Ltd, E Lawyers and F Company which conform with these reasons.
3.The costs of the application to file the subpoenas and the associated written submissions are reserved.
NOTATION:
A.These orders have been amended pursuant to r 10.13 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
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 Clifton & Aspen pseudonym has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
ALDRIDGE J:
INTRODUCTION
In these proceedings the wife seeks leave to issue a number of subpoenas to which the respondents object. Instead of objections being taken to the subpoenas after issue and service, the parties have filed written submissions as to the proposed content of them prior to their issue.
The nature of the proceedings is as identified in the Second Further Amended Initiating Application and Second Further Amended Points of Claim both filed on 25 June 2023. The apparent relevance of the documents the wife seeks to have produced will be determined by the issues raised in them (Xinfeng Australia International Investment Pty Ltd v GR Capital Group Pty Ltd [2020] NSWSC 620). In Clifton & Aspen [2023] FedCFamC1F 376, I identified the relevant principles to be applied as follows:
44.The relevant test for the issue of a subpoena for the production of documents is that they must have some apparent relevance to the proceedings: Hatton v Attorney-General of Commonwealth of Australia & Ors (2000) FLC 93-038 at 87,606.
45.In Secretary of the Department of Planning, Industry and Environment v Blacktown City Council [2021] NSWCA 145, Bell P, as his Honour then was, discussed the principles relevant to a finding of apparent relevance (at [68]–[73]). At [89] Brereton JA said:
89.I agree with Bell P, for the reasons given by his Honour, that an issuing party is not required to show that it is “likely” (or “on the cards”) that the documents sought will materially assist its case, as distinct from that it is “likely” (or “on the cards”) that they will add, in some way or another, to the relevant evidence in the case, and that the essential question is whether the documents called for are apparently relevant, or capable of providing a legitimate basis for cross-examination, in which case there is a legitimate forensic purpose for the issue of the subpoena. In my view, at least in civil proceedings and in the absence of any question of public interest immunity, no more is required to support the issue of a subpoena for production than that there is a reasonable basis for supposing that the material called for will likely add, in the end, in some way or another, to the relevant evidence in the case. This reflects the notions that the documents relate to, throw light on, or are sufficiently relevant to the dispute; that they “appear relevant in the sense that they relate to the subject matter of the proceedings”; or that they could possibly throw light on the issues in the case. Moreover, documents will add “in some way” to the relevant evidence in the case if they are capable of assisting in cross-examination, or go to credit, and notwithstanding that they are inadmissible according to the rules of evidence.
46. Thus, the bar for establishing apparent relevant is set fairly low.
I shall not repeat what was said in the earlier decision and in Clifton & Aspen (No 2) [2023] FedCFamC1F 594 (“Clifton & Aspen (No 2)”), but I adopt what was set out in those cases, particularly as to the nature of the proceedings and the issues to be resolved, and will assume that the reader is familiar with them.
It is convenient to deal with each subpoena separately.
RR Lawyers
Ms SS was, apparently, the solicitor for Mr T and EE Pty Ltd.
The proposed subpoena seeks the production of the following documents:
Documents and things you must produce from your possession, custody or control
1. A copy of this Subpoena;
2.For the period 1 January 2013 to date, copies of all agreements, instruments, consultancy agreements, Deeds, loans, heads of agreement, call options, put and call options, notices to exercise options, land agreement, memoranda of understanding including correspondence recording any memoranda of understanding, and contracts, with any of the following persons or entities being listed as a party, or otherwise noted or included as an interested party:
a.[Mr B Aspen] born […] 1969, in his personal capacity or otherwise;
b. [K Pty Ltd];
c.[K Pty Ltd] ATF the [K Trust];
d. [K Capital Pty Ltd];
e.[K Capital Pty Ltd] ATF the [Mr B Aspen Trust].
3.For the period 1 January 2013 to date, copies of all agreements, instruments, consultancy agreements, Deeds, loans, heads of agreement, call options, put and call options, notices to exercise options, land agreement, memoranda of understanding including correspondence recording any memoranda of understanding, and contracts in respect of an equitable interest in the land contained in folio identifiers [Lot EE2] and [Lot EE1], being the relevant property identifiers as at 25 February 2016 then owned by [EE Pty Ltd].
4.For the period 1 January 2013 to date, copies of any Call Option or Put and Call Option between:
a. [EE Pty Ltd]; and/or
b.[EE3 Pty Ltd]; and/or;
c. [Mr T]; and/or;
d.[TT Pty Ltd]; and/or
e.A related entity of [Mr T];
and any of the entities or persons identified in paragraph 2(a) to (e) above.
The first respondent, in written submissions filed on 24 July 2023, objects to that request because:
·Paragraph 2 is not limited to Lot …40, which is the relevant property identified in the Second Further Amended Points of Claim;
·There is no legitimate purpose to seek documents beyond early 2017, which was when Lot …40 was purchased by V1 Pty Ltd;
·The words “land agreement” and “otherwise noted or included as an interested party” are meaningless or, at least, ambiguous;
·K Capital Pty Ltd as trustee or in its own right are irrelevant to the claim against V1 Pty Ltd pleaded in the Second Further Amended Points of Claim and
·EE3 Pty Ltd, Mr T, TT Pty Ltd and any related entity of Mr T are not relevant to any claim as pleaded in the Second Further Amended Points of Claim.
The second and third respondents submitted that:
·Paragraph 2 should be limited to Lot EE1, Lot EE2 and Lot …00/…73, being the land referred to in the Second Further Amended Points of Claim and
·The subpoena should be limited to documents relating to K Pty Ltd, in its own capacity and as trustee.
I accept that the principles earlier identified permit the production of documents that go beyond the proof of the immediate issue and extend to those that relate to the subject matter of the proceedings. That includes being of assistance in cross-examination.
In my earlier reasons I expressed the view that if further relevant documents came to light, that could justify a further amendment to the pleadings. However, that possibility does not extend to justify the seeking of documents with a view to identifying a cause of action when there is no basis for presently thinking that one exists. That is an impermissible fishing expedition (Commissioner for Railways v Small (1938) 38 SR (NSW) 564 at 573; Associated Dominions Assurance Society Pty Ltd v John Fairfax & Sons Pty Ltd (1955) 72 WN (NSW) 250 at 254).
The wife refers to an email sent in February 2016 by the first respondent’s lawyers regarding a proposed lease in which the lawyer said that K Pty Ltd has an equitable interest in the property. On a generous reading of the email, as discussed in Clifton & Aspen (No 2), that property was Lot EE2 and Lot EE1. However, I did not allow the further amendments to the pleading to go beyond that part of the land known as Lot …40, which was subsequently subdivided from Lot EE2 and Lot EE1, because the email was too fragile a basis to justify that course.
Consistently with this view, the documents sought in this subpoena that go beyond the land, date and parties referred to in the Second Further Amended Points of Claim constitute a fishing expedition to try to justify the pleadings that were disallowed.
The question nonetheless arises as to whether the documents sought have some apparent relevance to the existing claims. I have to say that general assertions that such documents are relevant to understanding the underlying transactions, credit or a lack of proper disclosure, which were the submissions made by the wife, to be quite unhelpful. There are no submissions directed to how each of the above documents may be relevant in that sense.
I bear in mind that the first respondent’s evidence in chief described his role in the Suburb J development as a consultant only. He did not refer to the Agreements for Lease or Deeds of Covenant in that evidence or attempt to explain them. In cross-examination, he denied entering into put and call options in 2014. The wife’s submissions do not identify the apparent relevance of those documents to the credit of the first respondent.
It is for the wife to show apparent relevance. I am not satisfied that she has done so in relation to these documents.
In any event, the claims for production are too wide even if the basis for it is the lawyer’s email to which I have just referred. On that basis the documents sought would need to be limited by the land referred to in that document and to the time in which that land was disposed of to third parties.
I too struggle with what is meant by “land agreement” or “noted or included as an interested party”.
There is merit therefore to the objections of the respondents. Any subpoena should be limited to the three parcels of land identified by the second and third respondents as well as the other limitations noted by the respondents.
EE Pty Ltd
This subpoena seeks the following documents:
Documents and things you must produce from your possession, custody or control
1. A copy of this Subpoena;
2.For the period 1 January 2013 to date, copies of all agreements, instruments, consultancy agreements, Deeds, loans, heads of agreement, call options, put and call options, notices to exercise options, land agreement, memoranda of understanding including correspondence recording any memoranda of understanding, and contracts, with any of the following persons or entities being listed as a party, or otherwise noted or included as an interested party:
a.[Mr B Aspen] born […] 1969, in his personal capacity or otherwise;
b. [K Pty Ltd];
c.[K Pty Ltd] ATF the [K Trust];
d. [K Capital Pty Ltd];
e.[K Capital Pty Ltd] ATF the [Mr B Aspen Trust].
3.For the period 1 January 2013 to date, copies of all agreements, instruments, consultancy agreements, Deeds, loans, heads of agreement, call options, put and call options, notices to exercise options, land agreement, memoranda of understanding including correspondence recording any memoranda of understanding, and contracts in respect of an equitable interest in the land contained in folio identifiers [Lot EE2] and [Lot EE1], being the relevant property identifiers as at 25 February 2016 then owned by [EE Pty Ltd].
4.For the period 1 January 2013 to date, copies of any Call Option, Put and Call Option, Notices to exercise options and Termination Agreements between [EE Pty Ltd] and any of the entities or persons identified in paragraph 2(a) to (e) above.
5.For the period 1 January 2013 to date, all invoices issued to [EE Pty Ltd] from any of the persons/entities identified in paragraph 2 (a) to (e) above.
Paragraphs 2 and 3 are to the same effect as the previous subpoena and the same result is reached.
For the reasons given already, the identification of dates and parties in paragraphs 4 and 5 are too wide. The phrase “all invoices” is too wide and the documents sought should have some apparent relevance to the claims pleaded.
EE3 Pty Ltd
Whilst the documents sought are not identical to the previous subpoena (paragraph 4 of the EE Pty Ltd subpoena is not repeated), this subpoena is not materially different and the same result ensues.
The apparent relevance of the documents sought has not been identified other than in the very general terms discussed earlier.
Australian and New Zealand Banking Group Ltd
This subpoena seeking the following documents:
Documents and things you must produce from your possession, custody or control
1. A copy of this Subpoena;
2.Copies of the transfer documents, domestic telegraphic transfer receipts, receipts, remittances, records, forms, correspondence, memorandums and any other document identifying the account that received the funds, and the person/customer that caused the transfers, in respect to [K Capital Pty Ltd] ATF [Mr B Aspen Trust] account BSB […] Number […29] for the following transactions:
a. 29 June 2016, $132,028.00, description “Withdrawal”;
b. 29 June 2016, $132,028.00, description “Withdrawal”;
c. 29 June 2016, $283,278.00, description “Withdrawal”;
d. 29 June 2016, $283,278.00, description “Withdrawal”.
2.Copies of the transfer documents, domestic telegraphic transfer receipts, receipts, remittances, records, forms, correspondence, memorandums and any other document identifying the account that received the funds, and the person/customer that caused the transfers, in respect to [K Pty Ltd’s] account BSB […] Number […53] for the following transactions:
a.27 November 2013, withdrawal amount $49,559.19, description ‘[…14]’;
b.21 July 2016, withdrawal amount $128,693.48, description EB […81] to […09].
The first respondent objects to the production of the documents sought in paragraph 2 on the basis that these transactions have never been referred to before in the proceedings and the wife has not explained their apparent relevance.
The amount the subject of these transactions are significant as are the dates. The production of them may shed light on the issues in the proceedings.
E Lawyers
Production of the following documents are sought:
Documents and things you must produce from your possession, custody or control
1. A copy of this Subpoena;
2. Copies of the following invoices:
a.[E Lawyers] invoice paid by [K Pty Ltd] or [Mr B Aspen] born […] 1969 […] on or about 6 July 2016 for $1,104.00, identified as invoice number […48];
b.[E Lawyers] invoice paid by [K Pty Ltd] or [Mr B Aspen] on or about 16 February 2017 for $1,035.00, identified as invoice number […25].
3.For the period 1 July 2015 to 30 June 2017, copies of correspondence, files notes and instructions from and to [Mr B Aspen] in his personal capacity, or in his capacity as a director of [K Pty Ltd] relating to:
a.The representation by [Ms Z] of [E Lawyers] to [Mr UU] under cover of email dated 14 January 2016 that the ultimate intention was for [K Pty Ltd] to acquire the property upon which the [V4 Facility] would be constructed;
b.The representation by [Ms Z] of [E Lawyers] to [Mr VV] and [Ms WW] under cover of a further email dated 14 January 2016 that [Mr B Aspen’s] entity would be acquiring the property which the [V4 Facility] would be constructed on;
c.The representation by a solicitor of [E Lawyers] to [XX Lawyers] in the schedule attached under cover of email dated 25 February 2016 [K Pty Ltd] and/or [Mr B Aspen] had and equitable interest in the land contained in folio identifiers [Lot EE2] and [Lot EE1], being the relevant property identifiers as at 25 February 2016 then owned by [EE Pty Ltd];
d.The representation by a solicitor of [E Lawyers] to [XX Lawyers] in the schedule attached under cover of email dated 25 February 2016 that [K Pty Ltd] and/or [Mr B Aspen] or one of its related bodies corporate will take transfer of the land which the [V4 Facility] would be constructed once the lots are created;
e.The disposition of the equitable interest [K Pty Ltd] and/or [Mr B Aspen] had in folio identifiers [Lot EE2] and [Lot EE1], being the relevant property identifiers as at 25 February 2016 then owned by [EE Pty Ltd].
4.For the period 1 January 2013 to date, copies of any Call Option, Put and Call Option, Notices to exercise options, agreements, contracts and Termination Agreements, including unexecuted copies, between EE Pty Ltd and/or a related entity of [Mr T] born […] 1952 and/or [K Pty Ltd] or [Mr B Aspen] or a related entity of [Mr B Aspen] save for documents disclosed pursuant to a previous subpoena filed in these proceedings including:
a.Consultancy Agreement dated 25 May 2020, between [K Pty Ltd], [EE Pty Ltd], [EE3 Pty Ltd], [TT Pty Ltd] and [Mr T];
b.Consultancy Agreement dated 25 May 2020, between [D Trust], [EE Pty Ltd], [EE3 Pty Ltd], [TT Pty Ltd] and [Mr T];
c.[KK3 Pty Ltd] Put and Call Option dated 20 December 2019, Deed of Variation dated 9 June 2020 and Termination Agreement dated 9 June 2023 for lot 3/[…20];
d.[KK4 Pty Ltd] Put and Call Option dated 20 December 2019 and Termination Agreement dated 9 June 2023 for lot 4/[…20];
e.[KK5 Pty Ltd] Put and Call Option dated 20 December 2019 and Termination Agreement dated 23 June 2023 for lot 5/[…20];
5.A copy of the Deed of Covenant between [K Pty Ltd] and [QQ Pty Ltd], which was emailed by [Ms Z] to [Mr YY] on 27 March 2017.
6. Copies of Trust Account statements for:
a. The period 1 July 2012 to date:
i. [Mr B Aspen];
ii. [K Pty Ltd];
iii. [K Capital Pty Ltd];
iv. [K Trust];
v. The [Mr B Aspen Trust];
b. For the period 1 July 2015 to date:
i. [D Pty Ltd];
ii. The [D Trust];
c. For the period 1 July 2016 to date:
i. [V1 Pty Ltd];
ii. The [V Unit Trust].
The first respondent objects to paragraph 2 apparently on the basis that the amounts are so small the invoices would lack apparent relevance. I do not see how that follows.
The first respondent objects to paragraph 3 on the basis that the reference to the first respondent in his personal capacity is beyond the pleadings which are limited to K Pty Ltd. That may be so, but the documents have apparent relevance in that they may shed light on the transactions involving that company.
The fact that the production of such documents might invite a claim for legal professional privilege is not relevant. That is a matter for another day.
There is merit in the second and third respondents’ submissions that the reference to an equitable interest in the land held by the first respondent personally should be deleted. There is no suggestion or pleading that he had such an interest.
Paragraph 4 seeks documents that relate to the claims that the wife has not been permitted to plead and are therefore impermissible fishing in the absence of something that indicates they have apparent relevance to the claim pleaded. None was identified, save for the general comments.
The respondents object to paragraph 6 on the basis that save for the entities described in paragraph 6(a), the remaining documents have no apparent relevance. Again, the general comments relied upon by the wife do not assist her.
The relevance of the documents after the dates pleaded in the Second Further Amended Points of Claim is not apparent.
F Company
This subpoena seeks production of the following:
Documents and things you must produce from your possession, custody or control
1. A copy of this Subpoena.
2. Copies of the following invoices:
a.[F Company] invoices paid by [K Pty Ltd] or [Mr B Aspen] born […] 1969 […] or [K Capital Pty Ltd];
i. on or about 22 June 2015 for $10,382.90;
ii. on or about 25 August 2015 for $6,903.00;
iii. on or about 7 October 2015 for $3,377.00;
iv. on or about 17 October 2015 for $1,881.00;
v.on or about 15 November 2016 for $13,255.00, identified as invoice number […875];
vi.on or about 9 December 2016 for $2,200.00, identified as invoice number […175];
3. Copies of following advices:
a.The advice billed and paid as identified in paragraph 2 (a)(ii) above described as “structuring advice”;
b.The advice billed and paid as identified in paragraph 2 (a)(v) above described as “structure establishment”.
4.Copies of documents prepared pursuant to the Engagement letter issued to [Mr B Aspen] on or about 16 December 2020:
a. Establishing corporate trustee for a discretionary trust;
b. Establishing a discretionary trust;
c. Establishing Private Ancillary Fund (PAF);
d. Establishing corporate trustee for PAF;
e. Preparing a call option deed;
f. Preparing deed of restraint.
In her written submissions dated 25 June 2023, the wife justified production of these documents in the following terms:
28.The Wife contends the only threshold issue is apparent relevance. The Wife now seeks to set aside dispositions made by [K Pty Ltd] to the [D Superannuation Fund], as these were dispositions which would have the effect of putting assets, or otherwise, beyond the reach of this Court in any application brought by the Wife.
29.There were two advices that were apparently given: Given the timing, the first appears to relate to the creation of the [D Superannuation Fund]. The second appears to relate to the creating of the [V Unit Trust] and [V1 Pty Ltd] being the entity that the Wife contends received [K Pty Ltd’s] interest in the land.
They are references to claims that no longer form part of the Second Further Amended Points of Claim. Paragraph 4 cannot be justified.
On 25 August 2015, K Pty Ltd paid F Company $6,903 for “structuring advice”. On 15 November 2016, it paid for “structure advice”. Given the timing, these documents could well shed light on the issues in this case.
It may well be that these documents will attract a claim for legal professional privilege but that is again, not a matter for today.
Leave is granted to the wife to issue a subpoena to Australia and New Zealand Banking Group Ltd in the form already provided to the Court. Leave is granted to issue a subpoena to EE Pty Ltd, EE3 Pty Ltd, E Lawyers and F Company which conform with these reasons. It is not for me to redraft the precise terms of the subpoenas.
Costs of the subpoenas and written submissions are reserved.
I certify that the preceding forty-one (41) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Aldridge. Associate:
Dated: 3 August 2023
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