Elias and Elias
[2014] FCCA 457
•12 March 2014
FEDERAL CIRCUIT COURT OF AUSTRALIA
| ELIAS & ELIAS | [2014] FCCA 457 |
| Catchwords: FAMILY LAW – Practice and procedure – whether the wife should be able to access and copy the contents of the husband’s computer hard drive – application dismissed. |
| Legislation: Family Law Act 1975 Federal Circuit Court Rules 2001, Part 14; regs.14.01 – 14.11, 15A.01 – 15A.17, 24.03 |
| In the Marriage of Briese (1985) 10 Fam LR 642; [1986] FLC 91-713 Oriolo v Oriolo (1985) 10 Fam LR 665; [1985] FLC 91-653 Guinti and Giunti (1986) 11 Fam LR 160; [1986] FLC 91-759 |
| Applicant: | MS ELIAS |
| Respondent: | MR ELIAS |
| File Number: | SYC 7597 of 2013 |
| Judgment of: | Judge Monahan |
| Hearing date: | 6 February 2014 |
| Date of Last Submission: | 6 February 2014 |
| Delivered at: | Sydney |
| Delivered on: | 12 March 2014 |
REPRESENTATION
| Counsel for the Applicant: | Mr Meyer |
| Solicitors for the Applicant: | Meyer Partners Family Lawyers |
| Counsel for the Respondent: | Mr Minehan |
| Solicitors for the Respondent: | MCW Lawyers |
ORDERS
The wife’s interim application to be permitted to inspect the digital copy of husband’s computer hard drive stored by agreement at the Court and to take a copy thereof be refused.
THE COURT NOTES THAT:
(A)This matter remains listed for mention on 14 May 2014 at 11:30 am.
IT IS NOTED that publication of this judgment under the pseudonym Elias & Elias is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYC 7597 of 2013
| MS ELIAS |
Applicant
And
| MR ELIAS |
Respondent
REASONS FOR JUDGMENT
Introduction
These proceedings are between MS ELIAS (“the wife”) and MR ELIAS (“the husband”) and involve both parenting and property applications.
The relevant child is X born (omitted) 2012 (“X” or “the child”).
This decision relates to a discrete issue; namely, whether the wife can be permitted to have access to a digital copy of a computer hard drive that the husband allegedly used for business and personal purposes. The computer hard drive was taken into possession by the New South Wales Police in relation to certain investigations into the husband. The computer hard drive has been presumably, returned to him by now or will shortly be returned to him. The wife is also seeking copy access.
The access sought by the wife to the digital copy of a computer hard drive is opposed by the husband.
Unless otherwise stated, any statutory references I make will be to the Family Law Act 1975 (“the Act”) or the Federal Circuit Court Rules 2001 (the “Rules”).
Background
The parties provide particulars about the relationship in their respective affidavits filed in these proceedings. They agree that they commenced cohabitation during 2006 and married on (omitted) 2009. As stated, their child, X, was born in (omitted) 2012.
Although there is a factual dispute as to what caused the breakup of the relationship, there is evidence that a provisional Apprehended Domestic Violence Order (“AVO”) was taken out by the New South Wales Police against the husband and in favour of the wife and X. It would also appear that an incident or incidents on or shortly before separation have resulted in assault charges being laid against the husband.
Those assault charges and the relevant police investigation are directly relevant to the discrete issue before me. It would appear that a computer used by the husband and located in the former matrimonial home occupied by the wife, was seized by the New South Wales Police following the separation to further their investigations against the husband.
The wife commenced these proceedings with her Initiating Application filed on 20 December 2013. The proceedings came before me as an urgent matter in my duty list on 6 February 2014. On that occasion the parties were able to reach agreement on a number of interim parenting and property issues. In summary, the relevant consent short minutes of order provided as follows:
·the wife to have sole occupation of the ‘Property P property’ and for the husband to be restrained from approaching or entering that property;
·any rental payments from the ‘Property P property’ or ‘Property E property’ to be applied to the payment of the parties’ joint mortgage and for a mechanism for the payment of arrears if the rental income is insufficient;
·the husband to retain the remaining funds from the parties’ joint account;
·restraints on the parties otherwise using joint funds, further encumbering any property, terminating any existing tenancy and a mechanism for instituting new tenants should the existing ones wish to vacate;
·for a copy of the husband’s hard drive to be delivered to the Court; and
·orders relating to disclosure, the filing of documents and the execution of any necessary instrument.
Issues
As stated, the parties were unable to reach agreement as to whether the wife could inspect (or authorise a third party to inspect) the digital copy to be made of the relevant computer hard drive.
The relevant orders sought by the wife are as follows:
8. Upon receipt by the Registrar of the Federal Circuit Court of Australia of the [copy of the husband’s hard drive] and upon the wife providing to the husband an undertaking not to deal with the content of the materials other than for the purposes of the current proceedings, the wife and any person authorised by her in writing to do so be permitted to inspect the hard drive and computer hardware and take a copy thereof in the presence of such person or persons nominated by the Husband by excluding the Husband; and that having done so, the wife notify the husband’s solicitor in writing that this has occurred.
9. That thereafter the husband be permitted, in the presence of a person nominated in writing by the wife, to inspect and take copies of the hard drive.
During submissions, it became clear that if the Court had difficulties in allowing the wife to “take copies of the hard drive”, it was the inspection of the relevant material that was being pressed by the wife for the purpose of the interim application.
Evidence and Submissions
Each of the parties’ legal representatives presented oral submissions when the matter was before me on 6 February 2014. The transcript for the duty list hearing that was conducted that day will of course reflect those reasons. I do not propose to summarise those submissions, but will refer to those submissions where relevant during the course of these reasons.
Each of the parties asked the Court to read certain passages from their preliminary affidavits as follows:
·in the case of the wife, her affidavit sworn on 19 December 2013 and filed on 20 December 2013, paragraphs 124 to 125 (although for context, paragraphs 118 to 127 of that affidavit is arguably relevant); and
·in the case of the husband, his affidavit sworn and filed on 4 February 2014, paragraphs 88 to 94.
Law and discussion
This part of the decision will deal with the following:
·firstly, the obligation on the parties to provide full and frank financial disclosure in property matters; and
·secondly, a consideration of the Court’s power to require parties to produce documents and materials and by implication, a party’s ability to inspect (and copy) documents and materials that are produced.
Full and frank financial disclosure
There is a clear obligation on a party to proceedings in family law matters to make a full and frank disclosure of all relevant financial circumstances. The mere compliance with rules of the Court or practice directions does not alter the basic principle of the need for full and frank disclosure.[1]
[1] As discussed in the cases of In the Marriage of Briese (1985) 10 Fam LR 642; [1986] FLC 91-713 and Oriolo v Oriolo (1985) 10 Fam LR 665; [1985] FLC 91-653.
The Rules of this Court provide for all parties to make full and frank disclosure of all relevant financial circumstances in family law matters. Regulation 24.03 of the Rules states that:
“(1) A party required under this Part to file a financial statement or affidavit of financial circumstances must make in the statement or affidavit a full and frank disclosure of his or her financial circumstances, including details of:
(a) any vested or contingent interest in property (including real or personal property, superannuation and legal and equitable interests); and
(b) income from all sources, including any benefit received in relation to, or in connection with, the party's employment or business interests; and
(c) the party's other financial resources; and
(d) any trust:
…
(e) any gift or other disposition of property made by the party since the separation of the parties; and
(f) if there is a partnership, trust or company (except a public company) in which the party has an interest, copies of the 3 most recent financial statements and the last 4 business activity statements lodged by the partnership, trust or company.”
Apart from requiring each party in financial proceedings to file a Financial Statement, the Rules also require the production and supply of relevant documentation. If one party fails to fulfil that obligation, it would theoretically be “open to that party to rely on the absence of satisfactory evidence to prevent the making of an order against him or her which otherwise justice and equity would require”.[2]
[2] Guinti and Giunti (1986) 11 Fam LR 160 at 165; [1986] FLC 91-759 at 75,555.
As the Full Court observed in Guinti and Giunti (1986) 11 Fam LR 160; (1986) FLC 91-759:
“It would be simple, if that were the case, to evade the jurisdiction of this court, not by outright refusal which would attract sanctions but by obfuscation and evasion.” [3]
[3] Ibid.
In the case of In the Marriage of Briese (1985) 10 Fam LR 642; (1986) FLC 91-713 (“Briese”), Smithers J, after referring to the decision of the House of Lords in Livesey v Jenkins [1985] All ER 106, stated:
“I believe that the conclusion of the House of Lords in the case of Livesey v Jenkins is apposite, namely that in financial proceedings between spouses each party must make a full and frank disclosure of all material facts. In that case it was made clear that full and frank disclosure was required as a matter of principle in the light of the fact that it was the duty of the court, taking into account a number of designated criteria, to make a decision which basically involved the exercise of discretion. This is quite different from common law litigation between strangers, in which such a general duty does not exist, and obligations would only exist in so far as statute or court rules required. "In my view it is fundamental to the whole operation of the Family Law Act in financial cases that there is an obligation of the nature to which I have referred.” [4]
[4] In the Marriage of Briese (1986) FLC 91-713 at 75,181.
These comments were approved by the Full Court in the case of Oriolo v Oriolo (1985) 10 Fam LR 665; [1985] FLC 91-653.[5] Moreover, the Full Court also approved[6] the following ‘principles’ stated by Smithers J in Briese [emphasis added]:
“The wife has sought an order that the husband pay her legal costs of the proceedings. She relies upon the husband's conduct of the litigation, which in a number of respects I have referred to in this judgment. This conduct has had the effect of very greatly increasing the costs of the wife. The husband's counsel submitted that it was a matter for the wife to pursue her rights under the Family Law Regulations and that there was no positive obligation on the husband to do more than comply strictly with the Regulations and with orders of the court. He likened his client's position in this respect to that of a defendant in a civil action.
In my opinion this submission is not correct. I believe that a person in the position of the husband in this case has a positive obligation to set out at an early stage his financial position in a clear and comprehensive manner. The Regulations, and now the Rules, are not intended as a vehicle to mask the true position, or as an aid to confusion, complexity or uncertainty. They are not intended as the outer limits of the obligation of financial disclosure, but as providing avenues towards disclosure. The need for each party to understand the financial position of the other party is at the very heart of cases concerning property and maintenance. Unless each party adopts a positive approach in this regard delays will ensue with the consequent escalation of legal, accounting and other expenses, always assuming that a party has the strength to continue the struggle for information and understanding.
In this case it is possible, but I believe largely with the benefit of hindsight, to suggest one or two other strategies which the wife could have employed in her search for the facts before the trial. On the whole however, I do not believe that her case was conducted other than appropriately and reasonably. It was in the power of the husband to curtail the costs by making adequate disclosure.” [7]
[5] Oriolo v Oriolo (1985) FLC 91-653 at 80,256-7.
[6] Ibid at 80,256.
[7] In the Marriage of Briese (1986) FLC 91-713 at 75,180-1.
In the case before me, the wife outlines her belief that certain personal and business documents are stored on the husband’s hard drive. She articulates her belief in some detail in paragraph 127 of her affidavit.
In response the husband does not deny that the relevant hard drive may contain documents relevant to property he owns or controls. He articulates his belief that the likely documentation is stored on the relevant hard drive at paragraph 89 of his affidavit. The husband is concerned, however, that the hard drive is likely to also contain documents, photographs, music and related material that would not be relevant to these proceedings and/or may contain information or material relevant to third parties (such as members of his family or clients of his business).
In response to this concern raised by the husband, the wife through Mr Meyer, submitted that it is not unusual for subpoenaed material to also include documents and other materials that would fall within the ambit of the subpoena but would not otherwise be relevant to the proceedings.[8]
[8] Transcript, 6 February 2014, page 18.
The wife also raises a concern or makes a criticism that the husband has not, to-date, provided relevant documentation that would fall within his duty to provide full and frank financial disclosure.[9] That said, there appears merit in the husband’s response that it would have been difficult for him to provide the necessary documentation given his asserted belief that much of that documentation is contained on the relevant hard drive which has not been in his possession since separation.[10]
[9] Ibid, page 17.
[10] Ibid, page 19.
Consequently, it would be difficult for the Court to make any finding of deliberate non-disclosure at this point of the proceedings.
Specific disclosure and inspection of documents and materials
The rules of this Court also deal with obligations to disclose specific documentation.[11] The Court has the power to order a party to a proceeding to produce to it a document in the possession custody or control of that party.[12] A document produced under an order of the Court may be inspected and may, unless the Court orders otherwise, be copied.[13]
[11] Federal Circuit Court Rules, 2001, Part 14; see generally regs.14.01-14.11.
[12] Ibid, reg.14.04.
[13] Ibid, regs.14.07-14.08.
The rules of the Court also enable the filing and service of subpoenas and notices to produce.[14] There is a general right to inspect documents produced under subpoena unless an objection has been filed.[15] The Court must hear and determine access issues when an objection is made by a party or a third party in relation to the production or inspection or copying of a document or documents.[16]
[14] Ibid, Part 15A; see generally regs.15A.01-15A.17.
[15] Ibid, reg.15A.13.
[16] Ibid, reg.15A.14.
Notices to produce are governed by reg.15A.17 which states:
“(1) A party may, by notice in writing, require another party to produce, at the hearing of the proceeding, a specified document that is in the possession, custody or control of that other party.
(2) Unless the Court otherwise orders, the party given notice to produce must produce the document at the hearing.”
At this point of the decision, I should note that discovery is not allowed in relation to proceedings in this Court unless a Judge declares that it is appropriate, in the interests of justice, to allow it.[17] This prohibition (and the exception) also applies to the administering of interrogatories. In deciding whether to make such a declaration, the Court must have regard to:
“(a) whether allowing the interrogatories or discovery would be likely to contribute to the fair and expeditious conduct of the proceedings; and
(b) such other matters (if any) as the Federal Circuit Court of Australia or the Judge considers relevant.” [18]
[17] Federal Circuit Court of Australia Act, 1999, s.45(1).
[18] Ibid, s.45(2).
In this case, there is no request before me to allow interrogatories or discovery. There is no subpoena to produce documents or materials before me and I am not advised that a Notice to Produce has been served. That said, the parties have agreed to ‘quarantine’, for want of a better word, a digital copy of the husband’s computer hard drive and the wife suspects that there are materials on that hard drive that would be relevant to the property dispute. As stated, this is not denied by the husband. He indicated that he would comply with his obligations for disclosure once he regained access to his computer (and its hard drive).
There is merit in approaching the access issue by reference to the principles that would apply had the computer hard drive been the subject of a contested subpoena to produce. In other words, had the computer hard drive been produced to the Court under subpoena, should such a subpoena be set aside given the circumstances of this case or would there be merit in granting the parties access and copying privileges (restricted or otherwise)?
There are numerous reasons or grounds why a Court may order that a subpoena be set aside. These grounds have been discussed in a number of cases in this Court, the Family Court and in other Courts. These grounds include where:
·there is an absence of sufficient particularity in the description of the documents sought in the subpoena;
·the subpoena in the width of its requirements is oppressive;
·the documents are not in the possession, custody or control of that person;
·the documents or material is privileged or confidential;
·the subpoena is an abuse of process;
·it is inappropriate to issue a subpoena to another party in the proceedings instead of the normal process of disclosure (except in exceptional circumstances);
·the subpoena has been issued for a collateral purpose (such as to harass a party); and/or
·the evidence or documents are not relevant (although the material need not be admissible at the final hearing and it is sufficient if a genuine forensic interest is demonstrated or it is likely to be of aid in the preparation of the case or its overall investigation).
Had the computer hard drive been the subject of a subpoena to produce, it is likely that a number of the above grounds may have been argued. Of course, the digital copy of the relevant hard drive has found its way to this Court because of an external investigation conducted by the NSW Police and by the agreement of the parties. There is no question, therefore, that the contents of the hard drive are likely to be disposed of.
However, given that the disclosure by the husband of relevant documents may have been hindered by the seizure of the computer, the disclosure process must be allowed to proceed before the Court will consider the merits of allowing unrestricted access.
Consequently, the Court agrees with the submission of Mr Minehan for the husband that there is no prejudice to the wife at this early stage of the proceedings if she is not given access to the relevant hard drive.[19] The husband is under a positive obligation to comply with his duty of disclosure. Should the court be satisfied that the husband has been remiss in complying with his disclosure obligations, then the Court can revisit the issue of general access to the hard drive, the integrity of which has been preserved by having a digital copy held at the Court by agreement.
[19] Transcript, 6 February 2014, page 19.
Conclusion
Having considered the issue in dispute in light of the relevant principles and the available evidence, the Court is not persuaded to make the orders sought by the wife.
The husband will, of course, be required to comply with his obligations for financial disclosure which may include responding to any reasonable request made by the wife for access to, documents or copies of documents, which would be relevant to the financial dispute.
I note that the matter next returns before me on 14 May 2014 to consider, inter alia, the Child Dispute Conference memorandum and to make further directions in respect of all extant applications.
I certify that the preceding thirty-nine (39) paragraphs are a true copy of the reasons for judgment of Judge Monahan.
Date: 12 March 2014
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