Cornish & Cornish
[2022] FedCFamC1F 653
•1 September 2022
Federal Circuit and Family Court of Australia
(DIVISION 1)
Cornish & Cornish [2022] FedCFamC1F 653
File number(s): MLC 12589 of 2019 Judgment of: CARTER J Date of judgment: 1 September 2022 Catchwords: FAMILY LAW – PRACTICE AND PROCEDURE – subpoenas – where the first respondent caused subpoenas to be issued – where the applicant objects to the subpoenas – consideration of the relevance of the documents sought to be produced by subpoena – where the scope of the subpoena was too broad – objections upheld and subpoenas struck out – oral application refused. Cases cited: Allister v The Queen [1984] HCA 85
Trade Practices Commission v Arnotts Ltd (No 2) [1989] FCA 340
Division: Division 1 First Instance Number of paragraphs: 32 Date of last submissions: 26 August 2022 Date of hearing: 26 August 2022 Place: Melbourne Counsel for the Applicant Mr Chris Dunlop Solicitor for the Applicant Taussig Cherrie Fildes Solicitor for the First Respondent Mr Thomas Hobson The Second Respondent Did not participate The Third Respondent Did not participate The Fourth Respondent Litigant in person (did not participate) ORDERS
MLC 12589 of 2019 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS PEARCE AS LEGAL REPRESENTATIVE OF MS CORNISH
Applicant
AND: MR CORNISH
First Respondent
CC PTY LTD
Second Respondent
DD PTY LTD 2
Third Respondent
MR E CORNISH
Fourth Respondent
order made by:
CARTER J
DATE OF ORDER:
1 September 2022
THE COURT ORDERS THAT:
1.The following subpoenas be struck out:
(a)the subpoena issued on 26 July 2022 to UU Lawyers;
(b)the subpoena issued on 26 July 2022 to VV Lawyers; and
(c)the subpoena issued on 16 August 2022 to WW Lawyers.
2.The question of the applicant’s costs in relation to the subpoena objection be reserved to the final hearing.
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 Cornish & Cornish has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUSTICE CARTER
introduction
The matter came before me today for Case Management and Subpoena Objection hearing.
In relation to case management, the matter has now been set down for final hearing before me commencing 3 April 2023. The parenting and property aspects of this file have been bifurcated. The parenting proceedings will be heard by her Honour Justice Johns with a trial scheduled to commence on 31 January 2023.
The relevant parties in the interim dispute regarding the subpoena objections are:
(a)the applicant, being Ms Pearce (“the applicant”). She is the sister of, and the legal personal representative for the late Ms Cornish (“Ms Cornish”), who was married to the respondent; and
(b)the respondent husband, being Mr Cornish (“the respondent”).
There was no appearance before me this day by the second, third or fourth respondents, being two entities in which the respondent is involved and the respondent’s brother who is also involved in at least one of those entities. The respondent’s brother has not played an active part in these proceedings to date.
There are three subpoenas issued by the respondent to which objections are made by the applicant;
(a)the subpoena issued on 26 July 2022 to UU Lawyers to which an objection was filed on 10 August 2022;
(b)the subpoena issued on 26 July 2022 to VV Lawyers to which an objection was also filed on 10 August 2022; and
(c)the subpoena issued on 16 August 2022 to WW Lawyers. No formal objection has been filed in relation to that subpoena. It had not been served on the applicant. However, it was agreed by the parties that the objection could be dealt with by the court this day as WW Lawyers is the entity that took over UU Lawyers. The material sought and the objection to it are the same as the subpoena to UU Lawyers. That subpoena has not yet been produced to court, despite production being required on 30 August 2022.
This matter has a long, complex and tragic history. For the purposes of this interim hearing, the relevant chronology is as follows:
(a)the respondent and Ms Cornish separated on 15 October 2019.
(b)at some point, presumably after October 2019, Ms Cornish commenced instructing VV Lawyers in relation to family law proceedings. These proceedings were then initiated by her on 7 November 2019. She ceased instructing VV Lawyers and on 17 April 2020 Taussig Cherrie Fildes filed a Notice of Address for Service on behalf of Ms Cornish.
(c)Ms Cornish died in 2021. Her three siblings are the executors of her will. Ms Cornish had engaged UU Lawyers to prepare her will. UU Lawyers were subsequently engaged by the executors to undertake probate of that will. UU Lawyers has now been acquired by WW Lawyers.
(d)on 10 June 2021 the respondent lodged a caveat against the application for a grant of probate.
(e)on 8 July 2021 the executors applied for a grant of probate.
(f)the respondent then filed a summons in mid-2021 at the Supreme Court in relation to his caveat.
(g)the executors sought that the caveat and summons filed by the respondent be summarily dismissed. That application was heard on in early 2022. On that day the Supreme Court of Victoria dismissed the respondent’s caveat and summons. The respondent was also ordered to pay the costs of and incidental to the Supreme Court proceedings. Those costs have not yet been assessed.
The applicant was substituted for Ms Cornish as the personal legal representative on 30 March 2022 in this court. On that day, orders were also made for all outstanding financial statements for the parties’ various entities to be completed, and tax returns to be lodged on or before 28 June this year. That has not occurred. The solicitor for the respondent indicated he anticipated the financial statements would be completed shortly.
As the statements remain incomplete, and the returns not yet lodged, the valuations have not yet been undertaken. The parties cannot participate in a mediation, or indeed have any meaningful settlement discussions until the valuation processes are completed.
Subpoena objections
Counsel for the applicant says each of the subpoenas are an abuse of process. He says there is no apparent relevance of the documents to an issue in dispute, many of the documents are privileged, they constitute fishing and the documents to be produced are not properly time-restricted.
The test of relevance is wide. The court need only be satisfied that there is a rational or logical connection between the evidence and a fact in issue, or that the material could possibly “throw light” on an issue in dispute.[1] Put another way, the court only needs be satisfied that it is “on the cards” that the documents sought will materially assist the party who has sought the production of the document.[2]
[1]Trade Practices Commission v Arnotts Ltd (No 2) [1989] FCA 340, [46].
[2]Allister v The Queen [1984] HCA 85, [7].
The bar as to whether or not documents sought to be produced under subpoena will shed light on an issue in dispute in civil proceedings is not set very high. That is particularly so in family law proceedings. The question of ultimate relevance and/or admissibility will of course be determined at trial. However, whilst the bar is not very high, there is still a bar. A party is not entitled to simply subpoena material because they would like to see it. They also must satisfy the court that there is a legitimate forensic purpose in the subpoena. It is also not permissible to issue a subpoena purely to ascertain whether or not the party has evidence to support their case. Similarly, subpoenas cannot be too broad and must appropriately particularise the documents sought.
The subpoenas to UU Lawyers and WW Lawyers
The respondent has sought the production of all trust account ledger records, client debtor records and any other trust of accounting records in relation to all monies received from or on behalf of Ms Cornish and/or her estate. He says this is necessary to quantify the legal fees incurred by the estate, which he anticipates may be sought to be added back as legal fees expended by the parties. It was also asserted – without any particularity and with no basis being given for that assertion – that the executors may have incurred excessive legal costs. Accordingly, the legal fees incurred by UU Lawyers and WW Lawyers are, according to the respondent, relevant to a fact in dispute.
The subpoena as drafted does not provide any time frames for the documents sought beyond “the date upon which you commenced acting for” Ms Cornish and her executors. Nor is it limited to documents regarding the proceedings in the Supreme Court, or to the production of Ms Cornish’s will. Accordingly, it is asserted the subpoena is drafted too broadly, and could capture documents unconnected to the property proceedings, the Supreme Court proceedings or the production of Ms Cornish’s will.
The respondent says, however, that the material sought is readily identified, and will not be onerous. Indeed, UU Lawyers have provided the documents to the court and have not articulated an issue with the production being onerous. As noted the documents from WW Lawyers have yet to be produced.
It does seem to me that the subpoenas as drafted are broader than they ought be. As outlined, they would see the production of documents potentially not connected with these or the Supreme Court proceedings.
I further note it is asserted by the applicant that the costs incurred by the estate are being prepared for assessment and will be provided to the respondent. No time frame for that to occur was provided. Indeed the costs of the applicant of and incidental to the Supreme Court proceedings are being taxed. Neither party was able to advise when that process would be completed. The costs order was made some six months ago. That delay is regrettable. I understand the documents were sought by the respondent, but the applicant has declined to produce them.
As a general proposition, I accept that legal fees may fall within a category of expenditure that may be appropriately notionally added back into the pool where joint monies were used to make those payments. There is some irony in the respondent saying he may seek that the applicant’s legal fees be added back in circumstances where there is an outstanding order in the Supreme Court for the respondent to in fact pay those legal fees in connection with the caveat and summons application. I am unsure how that argument will ultimately play out.
Moreover, those fees will be assessed in due course pursuant to the processes of the Supreme Court. Once that has occurred, the parties will know what those costs are. How those cost should then ultimately be treated in the property dispute will be heard at a final hearing. If the respondent seriously seeks to challenge the manner in which the executors have conducted themselves – including that they have incurred unnecessary fees – that is a matter he needs to take up elsewhere. The subpoena process in this court cannot be used as a fishing expedition to see whether his unarticulated concerns in that regard have any basis.
I am of the view that the subpoenas as drafted are too broad. Moreover, I am of the view that there are processes in place in the Supreme Court which are currently being undertaken to assess those costs, which are then to be paid by the respondent. In the circumstances, it is difficult to see how the subpoenas were necessary to issue at this time.
Accordingly, I am of the view that the subpoenas should be struck out.
The subpoena to VV Lawyers
The respondent has sought VV Lawyers provide all trust account ledger records, client debtor recorders and any other trust or accounting records in relation to all monies received from or on behalf of Ms Cornish. He says again that is necessary in order to quantify the legal fees that Ms Cornish expended, which may become important in an addback argument.
I note that there is no restriction on the face of the subpoena to dates relevant to the family law dispute. That is, the subpoena as drafted seeks information without any temporal limitation beyond seeking documents from the date the firm commenced acting for her to the present. It was asserted by the respondent that it may be that he seeks the addback for legal fees expended with VV Lawyers, for matters beyond these proceedings, if that was appropriate. The submissions went no further than that.
The respondent further asserted the production of the documents is not onerous. They are readily identified, and have already been produced to the court by VV Lawyers without complaint or objection by them. He says additionally that the applicant can scour the document before it is produced to him, and redact any information considered privileged.
The applicant asserts that they already disclosed the trust and office account ledgers for VV Lawyers in relation to Ms Cornish’s family law proceedings on 14 October 2020. Further, it is asserted that Ms Cornish’s bank statements evidencing payment of her legal fees to VV Lawyers have also been produced.
I understood from the solicitor appearing on behalf of the respondent that they say there were some anomalies in the trust and office account ledgers disclosed. I was not, however, provided with any detailed analysis or argument beyond this bald assertion. At its highest, in his written submissions, the solicitor for the respondent asserted that on 21 July 2022 (being over 20 months after the ledgers were provided) the respondent “raised queries with the Applicant in relation to discrepancies between disclosed sources of funds disclosed by the Applicant for legal cost [sic] and legal expenses incurred in excess of $300,000”. I do not understand what that actually means. At any rate, the subpoena was issued just a few days after the respondent “raised queries”. It may be that those queries are answered by the applicant in due course.
I am of the view that in circumstances where it is asserted that the documents have already been provided, and where there is nothing of substance put before the court as to how those documents produced were deficient, it is not appropriate to permit a subpoena to be pursued. I note that the respondent asserts there are anomalies and some entries he does not regard as properly explainable or readily understood. However, no particulars were put before me about what those entries were, or why they were problematic. The respondent simply made this vague assertion without any specific reference to particular entries. Nor did the respondent address how issuing a subpoena would resolve those questions. It would seem that a more appropriate way of dealing with the issue is to formally request answers to questions that arise from the documents already provided.
Accordingly, I am of the view that the subpoena to VV Lawyers should be struck out.
Oral application for respondent to adduce valuation evidence
Lastly, I note that the respondent sought to make an oral application that he be granted leave to file evidence from a valuer in relation to the parties’ interests in B Company. I refused that application.
There was an extensive interim dispute regarding the preparation of valuations of those entities. Orders were made, not by consent, on 26 March 2021 giving the wife leave to file evidence from an expert in relation to various entities. Further orders were made, not by consent, on 13 April 2021 restraining the respondent from communicating with the wife’s expert and requiring them to provide all documents requested by the wife’s valuer to enable the valuations to be completed.
Those valuations remain uncompleted.
In my view, any application made by the respondent regarding valuations needs to be made properly, and on notice to the applicant. Moreover, any such application could not logically be heard and determined prior to the completion of the applicant’s expert’s report being provided. It may well be that the respondent is satisfied with that valuation. If he is not, then questions can be put in the usual way that may resolve any disputes or questions he has.
Until that valuation – and questions to the expert in relation to that valuation – have been completed, I expect any application by the respondent to adduce evidence from his own expert would be premature.
I certify that the preceding thirty-two (32) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Carter. Associate:
Dated: 1 September 2022
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