Faber v Child Support Registrar
[2018] FCCA 2301
•20 August 2018
FEDERAL CIRCUIT COURT OF AUSTRALIA
| FABER v CHILD SUPPORT REGISTRAR & ANOR | [2018] FCCA 2301 |
| Catchwords: PRACTICE AND PROCEDURE – Application to set aside subpoena – principles in relation to setting aside subpoena – whether subpoena issued for an improper purpose or an illegitimate forensic purpose – whether the subpoenaed document relevant to the issues to be determined – whether subpoena an abuse of process – whether subpoena oppressive or vexatious – consideration of effect of prior refusal to release subpoenaed document pursuant to a freedom of information request. |
| Legislation: Aboriginal Land Rights (Northern Territory) Act 1976 (Cth), s.11 Child Support (Assessment) Act 1989 (Cth), Pt.5 Div.7, ss.4, 25, 98C, 117 Federal Circuit Court Rules 2001 (Cth), rr.15A.02, 15A.09, 15A.14 Freedom of Information Act 1982(Cth), ss.37, 47E |
| Cases cited: Air Pacific Ltd v Transport Workers Union of Australia (1993) 40 FCR 1; (1993) 46 IR 1; [1993] ATPR 41-217 Ali Tastan (1994) 75 A Crim R 498 Child Support Registrar & Crabbe & Anor [2014] FamCAFC 10; (2014) 283 FLR 165; (2014) 51 Fam LR 1 Eaton v Sell Lease Property Pty Ltd & Ors [2016] FCCA 538 Federal Commissioner of Taxation v Trail Bros Steel & Plastics Pty Ltd [2010] FCAFC 94; (2010) 186 FCR 410; (2010) 79 ATR 780; (2010) 272 ALR 40 Mandic v Phillis [2005] FCA 1279; (2005) 225 ALR 760 Martinez v Minister for Immigration & Citizenship & Anor [2009] FCA 528; (2009) 177 FCR 337; (2009) 256 ALR 32 Minister for Aboriginal Affair & Anor v Peko-Wallsend Limited & Ors (1986) 162 CLR 24; (1986) 60 ALJR 560; (1986) 66 ALR 299 Minister for Immigration & Citizenship v SZMDS & Anor [2010] HCA 16; (2010) 240 CLR 611; (2010) 84 ALJR 369; (2010) 266 ALR 367; (2010) 115 ALD 248 Minister for Immigration & Multicultural Affairs v Jia Legeng [2001] HCA 17; (2001) 205 CLR 507; (2001) 75 ALJR 679; (2001) 178 ALR 421; (2001) 65 ALD 1 Morse & Potts (SSAT Appeal) [2010] FMCAFam 1305 Nevistic v Minister for Immigration & Ethnic Affairs (1981) 51 FLR 325; (1981) 34 ALR 639 Sean Investments Pty Ltd v MacKellar (1981) 38 ALR 363 Tarrant v Australian Securities and Investments Commission [2015] FCAFC 8; (2015) 66 AAR 24; (2015) 317 ALR 328; (2015) 104 ACSR 275 Waind v Hill and National Employers' Mutual General Association Ltd [1978] 1 NSWLR 372 |
| Applicant: | MR FABER |
| First Respondent: | CHILD SUPPORT REGISTRAR |
| Second Respondent: | MS FABER |
| File Number: | PEG 670 of 2017 |
| Judgment of: | Judge Antoni Lucev |
| Hearing date: | On the papers |
| Date of Last Submission: | 8 February 2018 |
| Delivered at: | Perth |
| Delivered on: | 20 August 2018 |
REPRESENTATION
| Applicant: | In person |
| First Respondent: | Mills Oakley |
| Second Respondent: | No appearance by or for the second respondent |
ORDERS
The Subpoena issued on 20 December 2017 for Document 277-040600 “Calculating financial capacity for business owners” be set aside.
Any party:
(a)seeking an award of costs must file and serve a written outline of submissions (of no more than five pages), supported, if necessary, by affidavit, by 27 August 2018; and
(b)any party opposing an order for costs sought in accordance with sub-paragraph (a) of this order must file and serve a written outline of submissions (of no more than five pages) in response, supported, if necessary, by affidavit by 3 September 2018,
with the Court to determine the issue of costs on the papers filed by the parties.
IT IS NOTED that publication of this judgment under the pseudonym Faber v Child Support Registrar & Anor is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT PERTH |
PEG 670 of 2017
| MR FABER |
Applicant
And
| CHILD SUPPORT REGISTRAR |
First Respondent
| MS FABER |
Second Respondent
REASONS FOR JUDGMENT
Introduction
On 20 December 2017 the applicant, known for the purposes of these proceedings by a pseudonym as Faber (presumably having regard to the provisions of s.110X of the Child Support (Registration & Collection) Act 1988 (Cth) (“CS Registration & Collection Act”)), filed and served a subpoena (“Subpoena”) in accordance with r.15A.02 of the Federal Circuit Court Rules 2001 (Cth) (“FCC Rules”) requesting the first respondent, the Child Support Registrar (“CS Registrar”), to produce Document 277-0406000 “Calculating financial capacity for business owners” (“Subpoenaed Document”) to the Court by 12 January 2018. On 12 January 2018 having produced the Subpoenaed Document to the Court, the CS Registrar filed a Notice of Objection to Subpoena (“Objection”) and supporting affidavit under rr.15A.09 and 15A.14 of the FCC Rules to set aside the Subpoena.
The substantive application in the proceeding is an appeal (“Appeal Application”) filed on 5 December 2017 from a decision of the Administrative Appeals Tribunal (“AAT Decision” and “AAT” respectively). The AAT Decision related to a review of a decision by the CS Registrar on an application by the applicant for a departure from the administrative assessment of child support payments (“CS Registrar’s Decision”).
At a directions hearing on 22 January 2018 orders were made for the CS Registrar and the applicant to file written submissions in respect of the Objection and for the Court to make a determination in relation to the Objection on the papers. In addition to the written outline of submissions filed by the applicant and the CS Registrar, three affidavits were filed:
a)affidavit of Ms D sworn 11 January 2018 (“Ms D’s First Affidavit”) (filed contemporaneously with the Objection);
b)affidavit of Ms D sworn 29 January 2018 (“Ms D’s Second Affidavit”); and
c)affidavit of the applicant dated 7 February 2018 (“Applicant’s Affidavit”).
The second respondent in these proceedings, Ms Faber, who is the applicant’s former partner, did not participate in the proceedings concerning the Objection. The second respondent may however be affected by the determination on the Objection because the applicant seeks the Subpoenaed Document for the purpose of proving that the CS Registrar and the AAT both erred in the AAT Decision when determining child support payable by the applicant to the second respondent. The applicant particularly takes issue with the assessment of the financial income of the second respondent as a business owner, and suggests the Subpoenaed Document will reveal the processes and procedures by which the administrative assessment of child support payments ought to have been made in relation to the second respondent’s financial income.
It is common ground that the Subpoenaed Document was not before the AAT when the AAT Decision was made.
The nature of the Subpoenaed Document
The Subpoenaed Document is 30 pages long, and the copy produced to the Court was valid from 21 March 2017. The document is produced by the Department of Human Services (“DHS”). At the top of the cover page it states:
This information is for internal use ONLY. Copies of this information should not be given to customers of any other external organisation.
At the outset the text-based version of the Subpoenaed Document (which is the only version provided to the Court) under the heading “Flowchart” and the further heading “Calculating financial capacity for business owners” refers to an “image” which it is said “provides a summary of the process for calculating financial capacity for a customer who is a business owner”. The straight-line descending Flowchart which follows then sets out eight boxed steps, the steps being as follows:
a)“Review case”;
b)“Review business tax information”;
c)“Review business structures”;
d)“Review financial statements”;
e)“Determine if any business profit can be attributed to the customer”;
f)“Determine if the customer has received any funds from a business”;
g)“Determine if customer has received any benefit from depreciation expenses”; and
h)“Determine financial capacity”.
The Subpoenaed Document then, under the heading “Process”, says that “This page outlines the process for calculating the financial capacity of a customer who is a business owner”. It is evident that the page referred to is a web-based page, as the process for calculating the financial capacity of a customer who is a business owner is then set out over the succeeding 28 pages of the text-based version of the Subpoenaed Document. The Subpoenaed Document then sets out various electronic links to the parts of the Subpoenaed Document under the following headings:
a)“Calculating financial capacity for a customer who is linked to or associated with a business owner”;
b)“Business tax information”;
c)“Business structure analysis”;
d)“Financial statement analysis”;
e)“Attributing profit to a customer”;
f)“Funds received from a business”; and
g)“Depreciation”.
The Subpoenaed Document then deals with the calculation of financial capacity for a customer linked to or associated with a business owner, and a table is set out which it is said “details the process for calculating the financial capacity of a customer who is linked to or associated with a business”. The table sets out a number of steps, the first of which is to calculate the financial capacity of the customer having regard to the fact that their income and financial resources may not be accurately reflected in an assessment if they are linked to or associated with a business, and refers the reader, by way of a web-based link, to what appears to be a further internal DHS document described as “Child Support Guide 2.6.14: Reason 8 – a parent’s income, property, financial resources, or earning capacity”. The Subpoenaed Document indicates that determining a customer’s income and financial resources may include determining how they generate an income and investigating any businesses they are linked to or associated with including reviewing the financial statements and personal benefits that a customer may receive from the business. Steps are then set out as to how an investigation into the customer’s financial circumstances may be undertaken, with various web-based links to other parts of the Subpoenaed Document to assist in what is described as “an analysis of the customer’s financial circumstances including any businesses they are linked to or associated with”. Once the financial analysis is completed the Subpoenaed Document indicates that there should be a determination as to whether any profit attributed to the customer or funds received by the customer from a business should be considered as the customer’s financial resource, and a further step which is to determine any other financial resources from the business that the customer is linked to or associated with including depreciation expenses, or business expenses providing the customer with a financial resource or personal benefit and the use of any business assets that provide the customer with a personal benefit, and that after that analysis and consideration of all income and financial resources a calculation of the income and financial resources is to be undertaken.
The Subpoenaed Document then sets out various tables which are said to provide “details to assist with analysing” the matters referred to (which reflect certain headings in [8] above), and which are as follows:
a)analysing business tax information to determine financial resources including considering information found in business tax returns and financial statements and any special taxations rules, and extensive detailing on how to interpret Business Activity Statements (“BAS”), indicators from GST registration and PAYG preferences. In relation to the BAS and using it to “assist in calculating or verifying the financial resources of a customer” the Subpoenaed Document indicates that determination of the performance of the business from the information in the BAS can be assisted by “using the BAS Analyser in the Capacity To Pay (CTP) tool suite macro” and contains a link to a separate page for the CTP tool suite;
b)analysing business structures and the considerations to be looked at as to the characterisation of a business as a sole trader, a partnership, a company or a trust, including a link to another web-based page entitled “Business Structures and Financial Statements for Child Support debt recovery” said to contain “information about the types of business structures”; and
c)details specific matters in financial statements that can be used to analyse income and expense components, net profit and loss, balance sheets, current and non-current assets and liability statements and owners’ equity. This part of the Subpoenaed Document goes into significant detail as to the various components of financial statements and their analysis over six pages of the text-based Subpoenaed Document, and also refers, once again to a web-based link to the “Business Structures and Financial Statements for Child Support debt recovery” document.
The Subpoenaed Document then “details the process for attributing profit to a customer”, which appears under the heading “Attribute business profit”, and then goes on to set out various steps relating to the attribution of business profit as follows:
a)determining the net or retained profit in a business for the purpose of determining whether that profit can be attributed to the customer as a financial resource from a business they are linked to or associated with;
b)determining the net profit of the business by using one or any number of possible approaches, including:
i)averaging the net profit over three years;
ii)averaging the net profit with an isolated unusual result removed;
iii)using upward or downward trends to calculate the business’s net profit;
iv)using the most recent year’s reported net profit; and
v)using the year most similar to the current circumstances for the business;
c)analysing business losses, including determining whether a loss has been used to intentionally minimise the financial resources of the customer, and if so whether that loss ought to be disregarded;
d)determining the net or retained profits available to be drawn from the business by the customer;
e)determining whether profit alienation has occurred, and in respect of determining whether profit alienation has occurred refers to the Child Support Guide 2.6.14 for more information by way of a web-based link; and
f)determining whether a customer has links to more than one business, and if so suggests that the above steps be applied to each of those businesses.
The Subpoenaed Document then goes on to deal with and detail:
a)how to determine if the funds a business owner is receiving from a business are in fact a financial resource, including identifying and grossing up business drawings and trust distributions, calculating dividends and assessing any loans; and
b)factors for consideration in determining if depreciation is being applied for business purposes, and if any depreciation expense is a financial resource to a customer. With respect to the use of depreciation the Subpoenaed Document again has an electronic link to the Child Support Guide 2.6.14.
Having set out the processes for and analysing the financial capacity of a person who owns, or has links to or is associated with, a business, the Subpoenaed Document then under the heading “References” indicates that this “page contains links to policy and legislation”. The page referred to is plainly an electronic page, and under the heading “Policy” contains only one link, that being to the Child Support Guide 2.6.14. It is not apparent from the link whether the Child Support Guide 2.6.14 is itself policy, or whether it contains references to, or further links to, relevant policy.
The Subpoenaed Document then contains a heading “Resources” and the “page”, again apparently a reference to an electronic page, is said to contain “resources to assist in calculating the financial capacity of a customer who is a business owner” and then indicates that “Some links on this page are unavailable to external audiences”. There is then an electronic link to the CTP tool suite, and a lengthy table in relation to different sections of a business tax return.
The business tax return section appears to provide a quick reference as to what a particular section in a business tax return may detail or indicate, and refers to other incidental information or guidance that may be of relevance to assist the CS Registrar make a child support assessment.
The Subpoenaed Document then goes on, under the sub-heading “Other” to provide electronic links to various other sites, said to be “ATO website”, “ATO benchmarks”, as well as three other links to sites related to business income tax returns, BAS and PAYG. Finally, the Subpoenaed Document contains reference to training and support available to staff in relation to various aspects of business structures, financial statements, profits, losses and retained earnings, drawings, dividends, loans and trust distributions and depreciation.
While the Court has not detailed at length the individual recommendations or instructions in each component step, it is clear that the Subpoenaed Document:
a)provides some discretion to the first-instance decision-maker, and it does not dictate a specific formula or method of calculation, but rather provides methods and processes as suggestions that may be used in different situations; and
b)is not itself a policy document, but contains at least one link to what is said to be a policy document, namely Child Support Guide 2.6.14.
AAT Decision
The AAT Decision is 27 pages long and is comprised of 171 paragraphs, and is summarised at [19] below.
In the AAT Decision, the AAT:
a)provided a brief overview of relevant background facts and the procedural history of the applicant’s child support assessment review since January 2015, including the remitter (by consent) by order of this Court of the matter for re-hearing in December 2016: AAT Decision at [1]-[8], and stated that at the AAT hearing the applicant attended in person and the second respondent appeared by telephone, with both providing sworn evidence: AAT Decision at [9];
b)noted it had allowed an adjournment of the AAT hearing on 24 July 2017 to enable the second respondent to consider submissions from the applicant that had not been received by the second respondent, and another document the applicant intended to rely upon, and allowed both parties to make further written submissions prior to reconvening the AAT hearing on 17 October 2017, where it confirmed the documents it had before were those provided by the CS Registrar, the applicant, and the second respondent, and a copy of the transcript of the pre-remitter AAT hearing: AAT Decision at [12];
c)referred to the applicant making two requests, the first orally at the AAT hearing on 24 July 2017 and the second written by letter received 3 August 2017, that the presiding AAT member recuse herself as the AAT member had not directed the second respondent to provide particular records: AAT Decision at [11], and that it had refused the application for recusal on the basis the AAT Member was empowered to make directions for the production of particular records, if necessary, before, during and after the hearing, and relevantly noted that the AAT directed the second respondent to provide further evidence after the AAT hearing, with a copy of that evidence sent to the applicant to comment upon: AAT Decision at [14];
d)addressed the fact that the applicant had not received some documents which the CS Registrar had provided in August 2017 due to the applicant having moved house, and the CS Registrar not having had the applicant’s correct address, however, confirmed that these documents comprised letters and assessment notices which had previously been sent to the parties, and noted that when the applicant was asked if he wanted a copy of the documents he responded in the negative: AAT Decision at [13];
e)was satisfied the second respondent had provided sufficient evidence for the AAT to properly determine an appropriate level of income for child support purposes, that evidence including:
i)business and personal tax returns, and financial statements for her business, for the 2013/14, 2014/15 and 2015/16 financial years;
ii)copies of bank statements for two bank accounts for a period from November 2014 to February 2015;
iii)copies of ledgers, including the business purchases ledger for the business for 2015/16; and
iv)bank statements for a Bank A account from May to October 2016, as well as other documents: AAT Decision at [22] and [24];
f)referred to the applicant’s submissions that the documents and evidence of the second respondent cannot be relied upon as they “are the by-products of documents and information to which [the second respondent] had and has 100% control”, and that the second respondent had “shown no understanding, or a complete disregard, of her obligations for full and frank disclosure”, and confirmed that the AAT was satisfied that documents were provided as requested during the course of the assessment process, and that while there was a delay in providing the documents it accepted the second respondent’s explanation that she believed the applicant was withdrawing his objection to the assessment, and so she thought providing documents as requested as part of the objection to the assessment process was not necessary: AAT Decision at [23]-[24];
g)extensively referred to and analysed the financial records and data and evidence including:
i)noting the submissions made as to the reliability of the data provided by the second respondent;
ii)finding that it was not possible to ascertain the business income from property sales by applying a single percentage to the total value of properties sold; and
iii)finding that it is not unusual for typographical errors to occur from time to time with bookkeeping tasks and that when the accountant at the previous AAT hearing was asked specific questions about the business's financial statements he responded with clarity and in a manner that demonstrated he was across the detail of the financial statements, and that the AAT was therefore satisfied that there was no reason to doubt the reliability of the financial statements prepared by the accountant’s firm: AAT Decision at [26]-[40];
h)discussed the concerns raised by the applicant regarding the business credit cards, and whether they were used to hide the purchase of personal items by the second respondent, and detailed the evidence of the second respondent regarding specific amounts reflected in the business’s financial statements, and noted that the accountant produced the financial statements, and that if there was a mistake in the financial statements that the second respondent was not necessarily able to assist with or answer queries as she did not have the same understanding of the business’s financial statements “as she does the sales”: AAT Decision at [41]-[49];
i)indicated that it asked the second respondent a number of questions concerning why the business accrued a loss in 2015/2016, and noted that the explanations given in response to the questions led it to conclude that there was no single reason for the loss made in 2015/16, and that the second respondent had provided an explanation that accounted for most of the difference between the profit figures for 2015/2016 and 2014/2015: AAT Decision at [51]-[58];
j)when determining the second respondent’s income from the business carefully detailed the second respondent’s evidence, referred to the documents relating to earnings, acknowledged the contention of the applicant that because the second respondent was not paid all to which she was entitled (by choice), that that was to the applicant’s detriment with regards to the child support assessment, and noted that the AAT was required to consider a person's income, property and financial resources, and particularly so for business owners who may have a financial resource over and above their personal income, represented by the profits made by a business: AAT Decision at [59]-[68];
k)referred to a previous change of assessment application concerning the applicant and the second respondent and outlined the process by which the taxable income was arrived at in that case in order to explain why it was different to the assessment now made by the AAT, namely that the AAT was of the view the method used in the earlier assessment by the CS Registrar was unreliable because of the number of assumptions made, and the nature of those assumptions, and was therefore bound to be less accurate than the current calculation of business income based on source documents such as invoices: AAT Decision at [69]-[74];
l)agreed with the reasoning in the previous AAT decision as to the determination of the amount of the second respondent’s taxable income by reference to her personal taxable income in 2014/2015 and 65% of the business taxable income in 2014/2015 and calculated the second respondent’s taxable income accordingly: AAT Decision at [77]-[91];
m)assessed the second respondent’s taxable income for 2015/2016, and in so doing had regard to the business’s financial statements for 2015/2016, and indicated that it would adopt a similar approach to that used in the previous AAT decision, but noting that the business did not make a profit in 2015/2016. The AAT had regard to the purchase of not one, but two vehicles for the business, and acknowledged that that might, as the applicant submitted, have an impact on his child support liability by reducing the business profit, and that there was no depreciation expense in the 2015/2016 profit and loss statement and financial records for those vehicles, indicating that they were cash purchases, rather than leased vehicles, and also had regard to the fact that the second respondent sold two properties but was not charged fees in relation to them and that that was a benefit to her as a part-owner of the business (which is a business), and also had regard to various deductions claimed by the second respondent for work purposes and apportioned vehicle expenses between business and personal use to arrive at the second respondent’s income for child support purposes: AAT Decision at [92]-[100];
n)calculated the applicant’s taxable income for 2014/2015 and 2015/2016 by reference to his taxable income for those years and his final payslip for employment from which he was made redundant in September 2016: AAT Decision at [101]-[104];
o)found, on the basis of a reassessment of the second respondent’s taxable income and an increase in that taxable income, that the applicant’s child support liability should be $26,752 a year, and was further satisfied that as under the previous assessment the applicant was liable to pay $30,856, that that difference in the amounts was unjust and inequitable, and that a ground for departure from the earlier administrative assessment had been established pursuant to s.117(4) of the Child Support (Assessment) Act 1989 (Cth) (“CS Assessment Act”): AAT Decision at [105];
p)considered if the assessment was just and equitable as regards the children, and took into account the factors in s.98C(1)(b)(ii)(A) of the CS Assessment Act, including the income, property and financial resources of the applicant and second respondent, the costs related to the proper needs of the children and any hardship caused: AAT Decision at [108]-[125], and estimated that there would be a further liability of approximately $1,916, payable by the applicant who had been informed by the AAT of, and accepted, the possibility of an increase in his child support liability, and although there was limited information about the applicant’s current circumstances there was no evidence the extra liability would cause financial hardship: AAT Decision at [130]-[131];
q)outlined a number of the submissions and contentions the applicant had raised regarding the documents provided by the second respondent and that a negative inference should be drawn from the explanations and evidence concerning the gross overall income, which the AAT did not accept, and noted many of the submissions raised were not justified, and after analysing the evidence closely it observed there appeared nothing hidden in the payment of any sums or any appearance of inexplicable discrepancies: AAT Decision at [138]-[156], and specifically observed that the point had been made by previous decision-makers that the role of DHS and the AAT “does not involve forensic auditing”: AAT Decision at [141];
r)examined the liabilities sections of the draft balance sheet for the business for the financial year ending 30 June 2015 and the finalised balance sheet for the business for the same period, and found that although they did not match up, the difference was not significant, and suggests there may have been “mispostings” between accounts or reconciliations, and that some account balances that were shown in the draft version were amalgamated, and also compared the net assets in the draft balance sheet and the finalised balance sheet and again noted that the difference was not significant: AAT Decision at [158]-[160];
s)formed the view that the second respondent’s evidence regarding her business and her personal financial situation was generally reliable, largely consistent across various interviews and hearings, internally coherent when considered separately and as a whole, and that while there had been some inconsistencies, these were not sufficient to cast doubt on the second respondent’s overall evidence: AAT Decision at [162]-[169]; and
t)set aside the CS Registrar’s Decision, and varied the adjusted taxable income of both the applicant and the second respondent in the periods 21 January 2015 to 30 June 2015 and 1 July 2015 to 25 July 2016: AAT Decision at page 27.
Freedom of information requests
Prior to filing the Appeal Application the applicant attempted to access the Subpoenaed Document by contacting the CS Registrar on 9 October 2017 and requesting access under the Freedom of Information Act 1982 (Cth) (“FOI Act”). The applicant was advised on 14 November 2017, by an authorised Freedom of Information officer in the DHS, that the Subpoenaed Document was exempt in full under the FOI Act and he would be unable to access it (“FOI Decision”). The FOI Decision appears at Annexure S-1 to Ms D’s First Affidavit. The basis for the FOI Decision was as follows: Ms D’s First Affidavit, at page 8:
a)the Subpoenaed Document was found to contain information that if released may reasonably be expected to disclose lawful methods or procedures for preventing, detecting, investigating, or dealing with matters arising out of, breaches or evasions of the law, such that prejudice to the effectiveness of those methods or procedures would be suffered, citing s.37(2)(b) of the FOI Act;
b)if the information were released it may reasonably be expected to have a substantial adverse effect on the proper and efficient conduct of the operations of DHS in circumstances where release is contrary to the public interest, citing s.47E(d) of the FOI Act;
c)specifically, the Subpoenaed Document contains procedures and methods for preventing, investigating or detecting breaches or evasions of customer's payment obligations under the CS Assessment Act and the CS Registration & Collection Act; and
d)release of the Subpoenaed Document would potentially facilitate non-compliance by some customers of DHS by providing a means of understanding how to circumvent DHS’s investigative methods, avoid detection and take steps to arrange their finances to minimise or disguise their true financial position.
The applicant sought review of the FOI Decision on 15 November 2017, and on 15 December 2017 a second authorised DHS Freedom of Information officer upheld the FOI Decision (“FOI Review Decision”). Save for acknowledging the applicant made written submissions, and that one of those submissions was that release of the Subpoenaed Document was in the public interest on the basis that there ought to be transparency in the operation of statutory schemes and government initiatives. The basis for the making of the FOI Review Decision is identical to the reasoning in the FOI Decision.
Appeal Application
Original Appeal Application
The original Appeal Application contained no grounds of appeal. The Appeal Application did, however, plead that grounds could only be completed once the applicant had access to “the Transcripts”. Presumably, that is intended to be a reference to the transcript of the AAT hearing.
The Appeal Application sought various orders including the allowing of the appeal and the quashing or setting aside of the AAT Decision, but most relevantly to the Objection the applicant sought an order that the AAT expressly order the second respondent to provide the following:
a.3rd party independent financial documents (both personal and in relation to the Second Respondent's business), including but not limited to: bank statements; credit card statements; savings and other accounts from which financial transactions are credited and debited;
b.3rd party independent invoices and / or receipts supporting excessive expenditure claims on the Second Respondent's personal and business tax returns, including but not limited to: low asset purchases and depreciation schedules; phone accounts; conjunction fees; car repairs and "general office expenses"; and
c.any other documents that will assist the Third Respondent to make an informed determination to the income, earning, and financial capacity of the Second Respondent for child support purposes,
for the period 1 October 2014 to 17 July 2017.
The applicant, no doubt conscious of the requirement that an appeal be on a question of law: Administrative Appeals Tribunal Act 1975 (Cth) (“AAT Act”), s.44AAA, set out three purported questions of law in the Appeal Application as follows:
1.Whether the Third Respondent denied the applicant natural justice and / or failed to accord the applicant procedural fairness
2.Whether the Third Respondent erred in law in failing to have regard to the financial resources of the Second Respondent
3.Whether the Third Respondent erred by disregarding the law, or incorrectly interpreting and applying the law to the facts
The Appeal Application grounds are amended
By order dated 20 December 2017 the Court gave the applicant leave to amend the Appeal by no later than 4.00pm on the day 35 days following the provision to the applicant of the transcript of the AAT hearing from Auscript. On 12 February 2017 the applicant filed an amended Appeal Application (“Amended Appeal Application”).
The grounds set out in the Amended Appeal Application are as follows:
GROUND 1
1.Whether the Administrative Appeals Tribunal (AAT) denied the applicant natural justice and / or failed to accord the applicant procedural fairness
Particulars
1.1 The AAT did not afford natural justice and / or procedural fairness to the applicant as it:
(a) failed to request the Second Respondent provide it with full and frank disclosure of the Second Respondent’s financial position
(b) failed to request the Second Respondent provide it with full and frank disclosure of the Second Respondent’s company’s financial position
(c) expressly refused, when requested by the applicant to do so, to inform the Second Respondent of the Second Respondent’s on-going duty for full and frank disclosure of its financial position
(d) expressly refused the applicant’s repeated requests and submissions that the Second Respondent disclose the materials as set out at 1.1(a)-(b) above
(e) erroneously believed, expressly stated, and incorrectly proceeded on the basis that it is not bound by relevant legal principles in relation to full and frank disclosures in financial matters involving ex-partners where a parent is also a business owner
(f) drew conclusions about matters without evidentiary basis, or without alerting the applicant to such evidence so that the applicant could test the evidence
(g) dismissed uncontradicted evidence given by the applicant and justified its reasons for doing so by making untested and generalised statements
GROUND 2
2. Whether the AAT erred by failing to construe properly the applicable legislative provisions
Particulars
2.1 The AAT:
(a) did not adequately consider and apply the “fair”, “just” and “promotes public trust and confidence” provisions in section 2A of the Administrative Appeals Act 1975, and instead focussed on “quick” and “informal” by refusing to seek evidentiary documents from the Second Respondent
(b) incorrectly applied legal principles from Morse & Potts (SSAT Appeal) [2010] FMCAfam 1305, resulting in an adopted position which was diametrically opposite to what the principle intended
(c) did not give all due consideration to and / or expressly refused to consider relevant common law principles as they apply to the appropriate “starting position” in relation to financial matters between ex-partners, specifically where one or more of those parents is also a business owner, to “full and frank disclosures” of the total financial position of that party
(d) did not fully comprehend the meaning of “financial resources”, and therefore did not appropriately investigate the “financial resources” available to the Second Respondent
GROUND 3
3. Whether the AAT erred in law in failing to take into account relevant considerations or materials, or by giving account to irrelevant considerations or materials to such an extent that its decision is perverse, illogical or otherwise unreasonable
Particulars
3.1 The AAT failed to consider:
(a) the applicant’s submissions to the legal principles of full and frank disclosures in circumstances where at least one of the parents is a business owner
(b) and failed to apply the Second Respondent’s own evidence in relation to her income and / or earning capacity
(c) the Second Respondent’s “capacity” for higher income by the Second Respondent’s voluntary actions to re-invest her commissions and other earnings
(d) the financial resources available to, owned by or in the power of, the Second Respondent as it refused to seek relevant financial documents from the Second Respondent
(e) the applicant’s evidence drawing attention to the Second Respondent’s inconsistencies, prior inconsistent statements and omissions
(f) the Second Respondent’s nature of income and capacity to earn an income and how that is to be reconciled for child support purposes and “for the benefit of the children”
3.2 The AAT gave account to:
(a) testimony from 3rd parties as being an attestation to the absolute truth and / or accuracy in the matter
GROUND 4
4. Whether the AAT demonstrated a reasonable apprehension of bias, or unreasonableness, or a predisposition against the applicant
Particulars
4.1 The AAT:
(a) expressly refused to consider;
(b) ignored addressing; and
(c) grossly misrepresented the applicant’s position in respect of,
the applicant’s substantial submissions to full and frank disclosure of financial matters where a parent is also a business owner.
4.2 The AAT accepted oral testimony from the Second Respondent to contradict written evidence provided by the applicant, even when that oral testimony also proved to inconsistent with written evidence provided by the Second Respondent
4.3 The AAT would interject and “answer” questions for the Second Respondent at times when the Second Respondent was caught wanting for explanation to her own evidence
4.4 The AAT has an unbalanced history when seeking evidence from paying parents as opposed to receiving parents
4.5 The AAT worked its decision by selectively choosing, or referring to, or trivialising, evidence on which it based its decision, at times also grossly misrepresenting context to that evidence to allow it to reach the decision and make the reasons to which it was pre-dispositioned
4.6 Further grounds may be added to this once if the applicant is successful in his subpoena application
The Court notes that the Amended Appeal Application was filed after the filing of submissions by both the CS Registrar (including the CS Registrar’s submissions in reply) and the applicant. No party, however, sought any further procedural orders to deal with this circumstance.
Basis for Objection
The grounds for the Objection are as follows:
a)the Appeal Application is an appeal on a question or questions of law from the AAT Decision: AAT Act, s.44AAA;
b)for the purposes of the Appeal Application the AAT is required to provide to the Court all documents that were before the AAT in connection with the application for review, and which are relevant to the appeal: AAT Act, ss.44AAA(2)(c) and 46;
c)in an appeal on a question of law the AAT Act generally does not permit the reception of evidence that was not before the AAT. Section 44(8) of the AAT Act permits further evidence to be admitted provided:
i)it is not for the purposes of demonstrating an error of fact: Waterford v Commonwealth (1987) 163 CLR 54; (1987) 61 ALJR 350; (1987) 71 ALR 673 (“Waterford”); and
ii)it has a tendency to demonstrate an error of law: Rana v Repatriation Commission [2011] FCAFC 124; (2011) 126 ALD 1 (“Rana”);
d)the Appeal Application fails to articulate how the Subpoenaed Document, which was not before the AAT, could possibly have a tendency to demonstrate an error of law in the AAT Decision;
e)the applicant sought access to the Subpoenaed Document pursuant to the FOI Act; and
f)the FOI Decision was to refuse the applicant access to the Subpoenaed Document, because it was exempt, in full, under the FOI Act, as it contains:
i)information which, if released, would, or could reasonably be expected to disclose lawful methods or procedures for preventing, detecting, investigating, or dealing with matters arising out of, breaches or evasions of the law the disclosure of which would, or would be reasonably likely to, prejudice the effectiveness of those methods or procedures: FOI Act, s.37(2)(b); and
ii)information which, if released, would, or could reasonably be expected to have a substantial adverse effect on the proper and efficient conduct of the operations of an agency in circumstances where release is contrary to the public interest: FOI Act, s.47E(d).
CS Registrar’s submissions
On 29 January 2018 the CS Registrar made the following submissions in seeking that the Court set aside the Subpoena:
a)the principles to be applied in determining whether a subpoena should be set aside were set out in Eaton v Sell Lease Property Pty Ltd & Ors [2016] FCCA 538 at [2]-[3] and [8]-[9] per Judge Lucev (“Eaton”), including the following at [8] per Judge Lucev:
… when determining whether a subpoena or part of a subpoena should be set aside on the ground that it has not been issued for a legitimate forensic purpose, or on the ground that it calls for documents beyond what is necessary to fulfil the legitimate forensic purpose, the Court must:
a) identify the issue or issues with respect to which the issuing party claims his case will be materially assisted by the production of the documents called for by the subpoena; and
b) determine whether it is “on the cards” that the documents will materially assist the issuing party's case on that issue;
b)the nature of the proceedings before the Court as an appeal on a question of law pursuant to s.44AAA(1) of the AAT Act is of critical importance, and evidence may not be received under s.44(8) of the AAT Act for the purposes of demonstrating an error of fact: Waterford at [28] per Brennan J;
c)to succeed the error of law must arise from the facts as the AAT found them or it must vitiate the findings made or it must have led the AAT to omit to make a finding it was legally required to make. There is no error of law simply in making a wrong finding of fact, and one cannot adduce fresh evidence merely to demonstrate an error of fact;
d)in Rana at [20] per Kenny, Stone and Logan JJ the Full Court of the Federal Court stated:
The further evidence must, as the Full Court observed in Phillips's case [Phillips v Commissioner for Superannuation [2005] FCAFC 2] have a tendency, if admitted, to demonstrate an error of law ... In contrast, further evidence which touched on a matter of evaluative judgment on the factual merits of a claim would not be admissible, save perhaps exceptionally for the very limited purpose of underscoring why it was that in the event that a question of law were answered as an applicant contended, a remitter of the matter to the tribunal for rehearing would not be an exercise in futility;
e)the Subpoenaed Document was not before the AAT and the purported questions of law and grounds of appeal set out in the Appeal Application fail to articulate how the Subpoenaed Document could possibly have a tendency to demonstrate an error of law;
f)even if an error was made by the DHS in reliance on the Subpoenaed Document (which is neither admitted nor apparent), any error was cured following the making of the AAT Decision;
g)the Subpoena has therefore not been issued for a legitimate forensic purpose and cannot materially assist the applicant in these proceedings; and
h)further, the applicant made an application for access to the document under the FOI Act and was denied, and these proceedings should not be used for a collateral purpose to enable the applicant to circumvent the FOI Decision and FOI Review Decision and seek production of a document that lacks any apparent relevance to these proceedings.
Applicant’s submissions
The applicant’s submission are as follows:
a)the title of the Subpoenaed Document refers to, and therefore likely sets out, the processes and procedures which the CS Registrar ought to use to determine the income and earning capacity where a parent is a business owner;
b)submissions to the AAT during two reviews and to the Child Support Assessor during two objection processes have all targeted the legal precedents around full and frank disclosure and they were continually ignored, refused, overlooked or expressly disregarded;
c)the Appeal Application does, even in its current form, articulate enough of a question in respect of which the Subpoenaed Document may “materially assist” the applicant's case;
d)the Subpoenaed Document is not "new evidence" as contemplated by the authorities on this point, and as a process and procedure document relevant to the calculation of income, is a document akin to the legislation which governs child support matters;
e)in the same way that the key legislation underpinning an agency can be referred to in a case and does not need to be presented as "evidence" to the decision maker, the same should be determined for documents which are guidelines or process and procedure type documents;
f)by the nature of the Subpoenaed Document and the child support case before it, the CS Registrar ought to have considered the Subpoenaed Document during the assessment of the Change of Assessment applications, and then ought to have provided it to the AAT such that the AAT could properly and in an informed manner make a review of the CS Registrar’s Decision;
g)the job of the AAT is to “review” the CS Registrar’s Decision, and to do that the AAT must be able to consider all the available information, and the mechanisms by which the CS Registrar’s Decision was made - including any internal process and procedure documents;
h)the AAT would need to follow the same processes and procedures, guidelines, legislative provisions as the CS Registrar did, and to that end, it must be concluded that the Subpoenaed Document was, or ought to have been, before the AAT at the relevant time;
i)the Subpoenaed Document is being introduced to highlight bias or unreasonableness by the AAT, in that it completely disregarded a section of legislation, and is therefore an error of law;
j)in Rana at [20] per Kenny, Stone and Logan JJ:
... The prohibition against the reception of further evidence ... is not though a complete one. There is a limited scope ... where that evidence tends to prove that the specified question of law should, for a reason given in a specified ground of appeal, be answered in a way that entitles or ... disentitles an applicant to the orders sought ...
k)the question to be investigated and answered is not an attempt to re-agitate the “evaluative judgment on the factual merits”, rather it goes to whether the AAT has failed (intentionally or otherwise) in its duty to conduct a hearing in a fair, reasonable and unbiased manner, and therefore not afforded the applicant procedural fairness or natural justice, in accordance with the applicable law, processes and procedures;
l)access to the Subpoenaed Document is for the purposes of providing evidence that will support the applicant's case against the CS Registrar and AAT in relation to procedural fairness, natural justice, bias and unreasonableness;
m)in response to the CS Registrar’s submissions it was put:
i)its child support case ended in November 2016, so no further benefit, subsequent to its case, can be gained by access to the Subpoenaed Document;
ii)the applicant's position as an employee, not a business owner, cannot be benefited by inspection of the Subpoenaed Document, therefore there is no prejudice to the “effectiveness of those methods or procedures ... for preventing, detecting, investigating or dealing with matters ... ”;
iii)the applicant acknowledges and accepts that release of the Subpoenaed Document is only for the purpose for which it is sought, and cannot be used for other purposes, and as the child support case ended in November 2016, there is no “adverse effect on the proper and efficient conduct of the operations of the CS Registrar”; and
iv)release of the Subpoenaed Document is not contrary to the public interest for all those reasons, but it would be contrary to the public interest not to release the Subpoenaed Document where it can be shown that the CS Registrar and the AAT do not follow, or are arbitrary in their application of, the law and their own processes and procedures; and
n)the applicant intends to present evidence during the principal proceedings which shows that when a business owner parent is the paying parent, the CS Registrar and the AAT apply the precedents set out in the “Full and Frank Disclosure Submissions”, but are arbitrary in the application of the same precedents when the business owner is a receiving parent.
The Court notes that the Applicant’s Affidavit runs to 157 pages, and annexes the transcript of the two proceedings before the AAT and the “Full and Frank Disclosure Submissions” the applicant made to the CS Registrar and the AAT regarding the second respondent’s disclosure of documents pertaining to her financial capacity. The Applicant’s Affidavit referred to an extensive list of authorities on the requirement of “full and frank” disclosure when addressing financial capacity in family law proceedings and likewise sought to refer the AAT to the duty and obligation to require the second respondent to make full and frank disclosure in order to afford the applicant procedural fairness. The Court further notes the content of the Applicant’s Affidavit is largely irrelevant to the determination of the Objection, which relates to whether a document intended for use by the CS Registrar alone ought to be produced pursuant to the Subpoena.
CS Registrar’s submissions in reply
In reply the CS Registrar submitted as follows:
a)the AAT is an independent statutory body that performs its review function in accordance with the AAT Act, and whilst the AAT is bound to apply the relevant legislation governing the decision under review, the AAT performs its function independent from the DHS and in accordance with its own processes and procedures; and
b)the applicant has failed to establish any connection between his further assertions of error and the relevance of the Subpoenaed Document.
Consideration
Legislative framework
The principle object of the CS Assessment Act is to ensure that children receive a proper level of financial support from their parents: CS Assessment Act, s.4(1), supported by the following particular objects set out in s.4(2) as follows:
a)that the level of financial support to be provided by parents for their children is determined according to their capacity to provide financial support and, in particular, that parents with a like capacity to provide financial support for their children should provide like amounts of financial support;
b)that the level of financial support to be provided by parents for their children should be determined in accordance with the costs of the children;
c)that persons who provide ongoing daily care for children should be able to have the level of financial support to be provided for the children readily determined without the need to resort to court proceedings; and
d)that children share in changes in the standard of living of both their parents, whether or not they are living with both or either of them.
The objective that the level of child support, payable by parents for their children, should be readily determined is, at least in part, achieved by the application of the child support formula to the circumstances of the parents concerned. The formula itself is informed by regular statistical research undertaken by agencies of the Australian Government, relating to the actual costs of providing for children within the context of wages paid to average salary earners within Australia. The intention of the legislature is that the formula should be transparent and provide fairly for the financial support of children based on an objective assessment of their needs. The formula is also intended to be responsive to the care provided by separated parents for their children.
Pursuant to s.25 of the CS Assessment Act, separated parents of a child living in Australia may apply to the CS Registrar for an administrative assessment to be made in respect of the child concerned.
An appeal to this Court against a decision of the AAT in relation to child support is brought under s.44AAA of the AAT Act, and is limited to an appeal on a question of law.
Question of law
In Child Support Registrar & Crabbe & Anor[2014] FamCAFC 10; (2014) 283 FLR 165; (2014) 51 Fam LR 1 (“Crabbe”) at [54] per Bryant CJ, Finn and Kent JJ, the Full Court of the Family Court provided a summary of principles (and applicable authorities), which is relevant to the review of administrative decisions in the child support area, particularly what matters can constitute an error of law and those which did not necessarily do so, as follows:
a)the question of whether there is evidence to support a finding of fact or an inference drawn from a finding of fact is a question of law;
b)the making of a finding of fact or the drawing of an inference in the absence of evidence is an error of law;
c)a wrong finding of fact is not necessarily an error of law if it was based on evidence available to the decision-maker;
d)a finding of fact based on a faulty process of reasoning is therefore not an error of law: Minister for Immigration & Multicultural Affairs v Al-Miahi [2001] FCA 744; (2001) 65 ALD 141 (“Al-Miahi”) at [34] per Sundberg, Emmett and Finkelstein JJ;
e)judicial review is not to be engaged in overzealously in search of error so as to inadvertently turn judicial review of an administrative decision into a reconsideration of the merits of the relevant decision: Minister for Immigration & Ethnic Affairs v Wu Shan Liang& Ors (1996) 185 CLR 259; (1996) 70 ALJR 568; (1996) 136 ALR 481; (1996) 41 ALD 1; CLR at 271-272 per Brennan CJ, Toohey, McHugh and Gummow JJ; and
f)an administrative tribunal is required to do no more than set out the findings which it did make on facts which it considered material to the decision made: Minister for Immigration & Multicultural Affairs v Yusuf [2001] HCA 30; (2001) 206 CLR 323; (2001) 75 ALJR 1105; (2001) 180 ALR 1; (2001) 62 ALD 225 at [43] per Gaudron J.
A particular question of law which is said to arise from a decision of a tribunal should be stated with sufficient precision: Haritos v Commission of Taxation[2015] FCAFC 92 at [97] per Allsop CJ, Kenny, Besanko, Robertson and Mortimer JJ.
A mere assertion that the AAT “erred at law” in making a particular finding does not raise a question of law: Penman v Child Support Registrar & Anor (SSAT Appeal)[2013] FCCA 492 at [112]-[122] per Judge Scarlett.
It is well accepted an appeal to this Court from the AAT lies on a “question of law” and while by no means an exhaustive list:
[13] … what is “on a question of law” for the purposes of s 44 of the AAT Act has been analysed in many cases and includes:
1. Whether the AAT has identified the relevant legal test;
2. Whether the AAT has applied the correct test;
3. Whether there is any evidence to support a finding of a particular fact; and
4. Whether facts found fall within a statute properly construed
Federal Commissioner of Taxation v Trail Bros Steel & Plastics Pty Ltd [2010] FCAFC 94; (2010) 186 FCR 410; (2010) 79 ATR 780; (2010) 272 ALR 40 (“Trail Bros Steel”) at [13] per Dowsett and Gordon JJ.
A denial of procedural fairness, including bias raises a question of law: Mentink v Secretary, Department of Social Services [2015] FCA 473; (2015) 66 AAR 205 at [97] per Greenwood J; Frugtniet v Tax Practitioners Board [2015] FCA 1066; (2015) 67 AAR 336 at [71] per Jessup J.
Applicable principles - setting aside a subpoena
The Court may set aside all or part of a subpoena under r.15A.09 of the FCC Rules if the Objection, made in accordance with r.15A.14 of the FCC Rules, is made out in whole or in part.
In Ali Tastan (1994) 75 A Crim R 498 at 504 per Barr AJ (“Tastan”) the New South Wales Supreme Court said:
It is the duty of the Court, where the issue is raised, to require the party calling on a subpoena to produce documents to identify expressly and precisely the legitimate forensic purpose for which access to documents is sought and to refuse access unless such an identification is made.
(Quoted with approval by Brownie AJA in NSW Commissioner of Police v Tuxford & Ors [2002] NSWCA 139 at [22] (Spigelman CJ and Ipp AJA agreeing)).
The purpose or purposes for which it is legitimate to issue a subpoena have been stated both positively and negatively. Positively, the purpose is not restricted to enabling the issuing party to have the documents for the purpose of tendering them into evidence: Waind v Hill and National Employers’ Mutual General Association Ltd [1978] 1 NSWLR 372 per Moffitt P at 384-385 (Hutley and Glass JJA agreeing). Negatively, it is not legitimate to issue a subpoena for the purpose of “fishing”, that is where a party endeavours, not to obtain evidence to support its case, but to discover whether the party has a case at all: Commissioner for Railways v Small (1938) 38 SR (NSW) 564 (“Small”) at 575 per Jordan CJ; Tamawood Ltd v Habitare Developments Pty Ltd [2009] FCA 364 (“Tamawood”) at [30] per Collier J. The purpose for which it is legitimate to issue a subpoena falls between the above two purposes. That purpose was identified in Small where the New South Wales Supreme Court distinguished the illegitimate purpose of “fishing” from the legitimate purpose of endeavouring to obtain evidence to support the issuing party’s case:
[A] party is no more entitled to use a subpoena … than he is a summons for interrogatories, for the purpose of ‘fishing’, i.e., endeavouring, not to obtain evidence to support his case, but to discover whether he has a case at all.
Small at 575 per Jordan CJ.
Thus, the purpose for which it is legitimate to issue a subpoena is to obtain evidence to support the issuing party’s case.
The FOI Act access denial
The CS Registrar appeared to submit that the FOI Decision and the FOI Review Decision were such that they precluded the production of the Subpoenaed Document.
In light of the conclusions reached above as to whether the Subpoenaed Document serves any legitimate forensic purpose based upon the grounds of the Amended Appeal Application and matters arising from the applicant’s submission it is unnecessary to deal with this issue, other than to make brief observations hereunder:
a)the FOI Decision and the FOI Review Decision do not bind this Court in relation to the application for production of the Subpoenaed Document;
b)the FOI Decision and the FOI Review Decision are characterised by conclusion rather than analysis, and in both cases do little more than repeat the relevant statutory bases for refusal of access to the Subpoenaed Document under the FOI Act; and
c)the FOI Decision and the FOI Review Decision characterise the Subpoenaed Document as integral to the prevention, detection, investigation or dealing with matters arising out of, breaches or evasions of the law, and as one which if disclosed, would have a substantially adverse effect upon the operations of DHS and would facilitate non-compliance by DHS customers by giving them an understanding of DHS’s investigative methods. These latter conclusions elevate the Subpoenaed Document to a status beyond its substance and content. There is no question of a breach or evasion of the law in this case in the sense referred to in the FOI Act, and no question arises as to the documents entailing the disclosure of trade secrets or other information having commercial value or commercial confidences: Secretary, Department of Workplace Relations and Small Business v Staff Development and Training Centre Pty Ltd [2001] FCA 1375; (2001) 114 FCR 301; (2001) 34 AAR 10 at [29] per Tamberlin, Mansfield and Emmett JJ. As the Court has observed several times the Subpoenaed Document does no more than guide an administrative decision-maker as to how to go about inquiring into, and as the Subpoenaed Document’s title indicates, actually calculating the financial capacity of a business owner who is a partner subject to a child support assessment, and does so in a manner which is best described as “orthodox”. Whilst the Subpoenaed Document is detailed and descriptive its content contains a check-list of inquiries in relation to business matters and documents, the nature and purpose of which would be matters of which most business owners would be aware. Thus, to the extent that it might be said to be a document which deals with lines of inquiry by DHS officers, they are lines of inquiry which would be perfectly obvious to most business owners, and if not obvious to them, then certainly obvious to any competent business accountant. Furthermore, it needs to be borne in mind that this is not a case of an investigation of a breach of any child support law, but an assessment of child support, thus the conclusions reached in the FOI Decision and the FOI Review Decision do not withstand even brief scrutiny, and certainly in this case, do not provide a basis to refuse to produce the Subpoenaed Document.
Is the subpoena oppressive or vexatious?
A subpoena will be oppressive where it is considered to be “seriously and unfairly burdensome” to a party to whom it is directed: Mandic v Phillis [2005] FCA 1279; (2005) 225 ALR 760 at [38] per Conti J. The Subpoenaed Document has been specifically identified by the applicant and does not oblige the CS Registrar to undertake wide searches nor decide what is relevant: Air Pacific Ltd v Transport Workers Union of Australia (1993) 40 FCR 1; (1993) 46 IR 1; [1993] ATPR 41-217. Its production would therefore not be oppressive or vexatious.
Tantamount to Discovery
The Court does not need to address this point as neither party raised the issue.
Further matters
In light of the Court’s findings above concerning the Objection it is not necessary to consider whether the:
a)CS Registrar was required to provide the Subpoenaed Document to the AAT; or
b)Subpoenaed Document might be admissible as new evidence in these proceedings.
Conclusion and Orders
The Court has concluded that the production of the Subpoenaed Document would serve no legitimate forensic purpose, and therefore the Objection must be upheld, with the result that the Subpoena issued on 20 December 2017 for Document 277-040600 “Calculating financial capacity for business owners” must be set aside. There will be an order accordingly.
With respect to costs:
a)any party seeking an award of costs must file and serve a written outline of submissions, supported, if necessary, by affidavit by 27 August 2018; and
b)any party opposing an order for costs must file a written outline of submissions in reply, and if necessary, any affidavit in support, by 3 September 2018,
with the question of costs to be determined by the Court on the papers.
The parties will be aware that this matter is now listed for hearing in a rolling list before Judge Vasta on 25 September 2018 at 9.30am.
I certify that the preceding one hundred and two (102) paragraphs are a true copy of the reasons for judgment of Judge Antoni Lucev
Date: 20 August 2018
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