Fair Work Ombudsman v D'Adamo Nominees Pty Ltd
[2010] FMCA 858
•4 November 2010
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| FAIR WORK OMBUDSMAN v D'ADAMO NOMINEES PTY LTD | [2010] FMCA 858 |
| INDUSTRIAL LAW – Penalty proceedings – alleged breach of Notional Agreement Preserving State Award – alleged underpayments. PRACTICE AND PROCEDURE – Subpoena – for production of documents – objections – relevance – whether legitimate forensic purpose – fishing – discovery – abuse of process – unnecessary – oppressive – too broadly framed – lacking in specificity – privileges against self-incrimination and exposure to penalty. PRACTICE AND PROCEDURE – Subpoena for production of documents – appointment of agent to facilitate compliance with subpoena. WORDS AND PHRASES – “sufficient evidence” – “pay records”. |
| Electrical Contracting Industry Award 1978 Federal Magistrates Act 1999 (Cth), ss.3, 42 Federal Magistrates Court Rules 2001 (Cth), rr.1.03, 15A.02(1), 15A.12(2), 15A.15 Workplace Relations Act 1996 (Cth), s.728 Workplace Relations Regulations 2006 (Cth), reg.19.18 |
| Balding v Ten Talents Pty Ltd (No.2) (2007) 160 IR 115; [2007] FMCA 161 R v Ronen (2004) 62 NSWLR 707; [2004] NSWCCA 67 Rogan v Director-General of Technical and Further Education (1987) 10 NSWLR 348 Smith v Granada Tavern & Ors (2007) 208 FLR 455; [2007] FMCA 263 Wingecarribee Shire Council v Lehman Brothers Australia Ltd (No.4) [2010] FCA 1128 |
| Applicant: | FAIR WORK OMBUDSMAN |
| Respondent: | D'ADAMO NOMINEES PTY LTD |
| File Number: | PEG 60 of 2010 |
| Judgment of: | Lucev FM |
| Hearing date: | 27 October 2010 |
| Date of Last Submission: | 27 October 2010 |
| Delivered at: | Perth |
| Delivered on: | 4 November 2010 |
REPRESENTATION
| Counsel for the Applicant: | Mr R. L. Hooker |
| Solicitors for the Applicant: | Sparke Helmore |
| Counsel for the Respondent: | Mr D. Howlett |
| Solicitors for the Respondent: | Westmont Legal |
ORDERS
Item 2 of the Schedule to the applicant’s subpoena to produce documents dated 13 September 2010 (“applicant’s subpoena”) be amended to read as follows:
“employment records: specifically, employment contracts, apprenticeship agreements, offers of employment and tax file number declarations for:
(a) Joe Zampogna;
(b) Joshua Houlihan; and
(c)“Anthony”, who was a second year apprentice in 2007 and worked directly with Mr Zampogna.”
Item 5 of the Schedule to the applicant’s subpoena to produce documents be amended by deleting the words “between your client and” and inserting “with”.
The applicant’s subpoena be further amended:
(a)to provide that it be directed to the respondent’s “agent”; and
(b)to provide a date and time for production of documents on or before 4.00pm on 8 November 2010.
For the purposes of compliance with the applicant’s subpoena the respondent appoint an agent forthwith.
Otherwise, the respondent’s objections to the applicant’s subpoena be dismissed.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT PERTH |
PEG 60 of 2010
| FAIR WORK OMBUDSMAN |
Applicant
And
| D'ADAMO NOMINEES PTY LTD |
Respondent
REASONS FOR JUDGMENT
Introduction
The primary proceedings in this matter relate to an application by the Fair Work Ombudsman alleging that a Mr Motherwell was underpaid by the respondent, D’Adamo Nominees Pty Ltd,[1] and seeking remedies in the form of declaratory relief concerning the alleged breaches of a notional agreement preserving a State award,[2] the payment of pecuniary penalties in relation to those alleged breaches, and the payment of the allegedly underpaid amounts to Mr Motherwell.
[1] “D’Adamo Nominees”.
[2] “NAPSA”. The State award being the Electrical Contracting Industry Award 1978 (“Award”).
The Fair Work Ombudsman has issued a subpoena for the production of documents by the respondent.[3] The Subpoena is objected to on various grounds. These Reasons for Judgment relate to the objections to production of documents in compliance with the Subpoena.
[3] “Subpoena”.
The Subpoena
By way of a schedule to the Subpoena the Fair Work Ombudsman seeks that D’Adamo Nominees produce the following documents to the Court:
“1.a copy of this subpoena.
2.employment records (including but not limited to employment contracts, apprenticeship agreements, offers of employment, and tax file number declarations) for:
(a) Joe Zampogna;
(b) Joshua Houlihan; and
(c) “Anthony”, who was a second year apprentice in 2007 and worked directly with Mr Zampogna – we are not aware of this employee’s surname.
3.pay records for the three employees named above for the period 20 August 2007 to 4 February 2008;
4.a copy of electrical contractors licence EC003836 for L & A Electrics issued 5 October 1989 (and any documents confirming renewal of such licence for the period August 2007 to January 2009); and
5.all correspondence between your client and Apprenticentre WA in relation to the apprenticeship of Steven Motherwell.”[4]
[4] “Schedule”.
At hearing, the Fair Work Ombudsman indicated that, in the event that the Court found that Item 2 of the Schedule was objectionable, particularly by reason of it being too widely framed, it would be prepared to seek to amend the initial part of Item 2 to read as follows:
“employment records: specifically, employment contracts, apprenticeship agreements, offers of employment and tax file number declarations for:”
Item 2 of the Schedule is manifestly too wide. It captures every form of employment record for the employees concerned, including many which simply could not have any legitimate forensic purpose in relation to the alleged breach of the NAPSA or the alleged underpayment of Mr Motherwell. An example given at hearing was a leave application to attend a relative’s funeral. There are numerous other examples which could be given in the area of personal, carers, sick or emergency management leave and other kinds of leave, as well as matters such as disciplinary records.
In the circumstances, it is apparent that Item 2 ought to be more narrowly cast, and for the purposes of the remainder of these Reasons for Judgment, the Court will consider Item 2 on the basis of the proposed amended Item 2, and test any objections against the more narrowly cast proposed amended Item 2.
At hearing the Fair Work Ombudsman also conceded that the words:
a)“we are not aware of this employee’s surname” in Item 2(c) ought not be part of the Schedule; and
b)“all correspondence between your client and Apprenticentre WA” ought to read “all correspondence with Apprenticentre WA” in Item 5 of the Schedule.
Objections to subpoena
Relevance
D’Adamo Nominees submits that the documents sought to be produced under the Subpoena are not relevant to the application. This, however, is to make the wrong inquiry. The correct description of the relevant inquiry has recently been described by the Federal Court as follows:
… Whether a subpoena has a legitimate forensic purpose is to be ascertained by reference to an assessment as to whether the Court is satisfied that it is “on the cards” (to use the expression of Gibbs J in Alister v The Queen (1984) 154 CLR 404 at 414) that the documents would materially assist the subpoenaing party in relation to the proceedings: see also R v Saleam (1989) 16 NSWLR 14 at 18A-F per Hunt J with whom Carruthers and Grove JJ agreed. This filter prevents the use of the subpoena as a mere “fishing expedition”.[5]
[5] Wingecarribee Shire Council v Lehman Brothers Australia Ltd (No 4) [2010] FCA 1128 at para.20 per Rares J (“Wingecarribee Shire Council”).
The documents sought to be produced under the proposed amended Item 2 of the Schedule are relevant because:
a)they:
i)are likely to detail the capacities in which relevant employees are employed; and
ii)may reveal the nature of the industry in which the employer and relevant employee, Mr Motherwell, were engaged in relation to the employment,
and therefore whether or not D’Adamo Nominees is bound by the NAPSA;
b)they may reveal whether any of the employees named in Item 2 of the Schedule were covered by the NAPSA, and whether they therefore might be persons:
i)employed to work on sites, to whom Mr Motherwell might have provided assistance; or
ii)under whom Mr Motherwell might have carried out certain duties under supervision; and
c)they may reveal whether Mr Motherwell was engaged for a period as an apprentice.
Item 3 of the Schedule, the pay records for the named employees for the period 20 August 2007 to 4 February 2008, may materially assist the Fair Work Ombudsman to establish that the employees were employed in a capacity covered by the NAPSA, either:
a)directly, for example by a statement in the pay records that the named employees were considered to be covered by the NAPSA, or in a classification covered by the NAPSA, or
b)indirectly, by reason of a pay rate matching that in the NAPSA for a relevant classification of employee,
which might assist in establishing that Mr Motherwell was an electrical assistant under the NAPSA by reason of the pay records establishing the classification of those with whom he worked.
Item 4 of the Schedule has a legitimate forensic purpose because a copy of:
a)the electrical contractors licence for L & A Electrics (seemingly the trading name for D’Adamo Nominees); and
b)the relevant renewal for the period August 2007 to January 2009,
may go to establishing that L & A Electrics was, at the relevant times, in the electrical contracting industry, which is a matter in dispute.[6]
[6] See Defence, paras.9-11.
Item 5 of the Schedule has a legitimate forensic purpose because it may go to establishing whether or not there was an agreement between D’Adamo Nominees and Mr Motherwell with respect to an apprenticeship, and, if so, when it was entered into and for what period.
D’Adamo Nominees’ objections on the basis of relevance therefore fail because each of the items numbered 2 to 5 in the Schedule to the Subpoena has a legitimate forensic purpose.
Fishing
D’Adamo Nominees claims that the documents sought to be produced under the Subpoena are sought as part of a fishing expedition. Having concluded that the documents subpoenaed have a legitimate forensic purpose, it cannot be said that the Fair Work Ombudsman is fishing.[7]
[7] Wingecarribee Shire Council at para.20 per Rares J.
There is no evidence to suggest that the Fair Work Ombudsman is seeking documents “for the purpose of making other similar applications.”[8] Not only is there no evidence which indicates that the Fair Work Ombudsman is intending, or has the purpose of, making another application based upon documents produced under the Subpoena, but such a course is contrary to the law. That is because r.15A.12(2) provides that a person who inspects or copies a document produced to the Court under the Federal Magistrates Court Rules 2001 (Cth)[9] “must”:
“(a)use the document only for the purpose of the proceedings; and
(b)not disclose the contents of the document or give a copy of it to any other person without the Court’s permission.”
[8] Notice of objection – subpoena, para.13b.
[9] “FMC Rules”.
The documents cannot therefore be used for the purpose suggested by D’Adamo Nominees.
Discovery
D’Adamo Nominees asserts that the Subpoena is being used as a substitute for discovery. In particular, it asserts that in relation to Items 2, 3 and 5 of the Schedule, it requires D’Adamo Nominees to make a judgment as to which documents relate to issues between the parties.
There may be some validity in relation to this argument in respect of Item 2, if it were not for the proposed amended Item 2. The proposed amended Item 2 is specifically limited to three employees, and to specific and limited categories of documents with respect to those employees. It requires no special or particular judgment to determine if something is an employment contract, apprenticeship agreement, offer of employment or tax file number declaration. Likewise with Item 3, it requires no judgment to determine what the pay records are for the three employees for the specified period. Similarly, with respect to Item 5 which seeks correspondence with Apprenticentre WA in relation to Mr Motherwell’s apprenticeship. There was a very confusing and confused argument put on the part of D’Adamo Nominees as to why Item 5 did require judgment, or was oppressive, burdensome or vague. It must be said that that argument on behalf of D’Adamo Nominees has no validity at all. Correspondence to and from D’Adamo Nominees for the relevant period will fall into one of two categories for this purpose:
a)correspondence to or from Apprenticentre WA; or
b)correspondence which is not correspondence to or from Apprenticentre WA.
A document fits either one category or the other. It is only the former category that is required to be produced in answer to the Subpoena. Determining whether correspondence is to or from Apprenticentre WA is something which can be determined on the face of the relevant document, and therefore, other than the usual judgment required in selecting a document, does not require any, or any particular or special, judgment to enable the documents, if they exist, to be produced in answer to the Subpoena. There is evidence of correspondence between D’Adamo Nominees and Apprenticentre WA.[10]
[10] Affidavit of Georgina Kate Mayman Rosendorff, affirmed 21 September 2010, para.27 (“Ms Rosendorff’s Affidavit”).
The objection on the basis that the Subpoena is a substitute for discovery therefore fails in its terms. Because it fails in its terms it is unnecessary for the Court to consider issues related to whether circumvention of discovery might not be a ground for setting aside a subpoena in a court or jurisdiction where discovery is not ordinarily granted.[11]
[11] Balding v Ten Talents Pty Ltd (No 2) (2007) 160 IR 115 at 120-121 per Lucev FM; [2007] FMCA 161 at para.27 per Lucev FM.
Abuse of process
It is common ground that the Fair Work Ombudsman’s litigation policy requires it to have “sufficient evidence” before it commences a prosecution.
D’Adamo Nominees argues that because the Fair Work Ombudsman instituted the proceedings it must have considered that it had sufficient evidence prior to doing so, and that therefore the Subpoena must be for other purposes, and is for that reason an abuse of process.
The policy requirement to have sufficient evidence does not require the Fair Work Ombudsman to have all of the evidence, or an overwhelming preponderance of the evidence, or to have evidence which proves the case to any particular standard. Rather, it is merely sufficient evidence which is required to institute the proceedings.
A simple example suffices to deal with the issue raised by D’Adamo Nominees in this respect. An employee goes to the Fair Work Ombudsman and says that she was employed by an employer in a particular job, and that she was underpaid. The employee describes the duties performed by her. There is no discernible reason for the Fair Work Ombudsman not to believe what the employee has said. The Fair Work Ombudsman checks the rate of pay that the employee says that she received for the duties outlined, and the Fair Work Ombudsman determines that it was not the current rate of pay under the applicable industrial instrument. That is sufficient evidence to institute proceedings for alleged breach of the industrial instrument, pecuniary penalties and payment of any underpayment. It cannot be said that the evidence of the employee outlining her duties was not sufficient to prove the fact of her employment, or the capacity in which she was employed. But the employee does not have a copy of a written contract of employment confirming her employment or the capacity in which she was employed. Therefore, the Fair Work Ombudsman issues a subpoena to the employer to produce any document of that type. If produced, the document may prove that the employee was employed, and the capacity in which she was employed. That would provide the Fair Work Ombudsman with better evidence in relation to those issues. The subpoena for production of the contract of employment seeks to have put before the court better evidence of a fact in issue.
In this case:
a)a claim was made by Mr Motherwell to the Fair Work Ombudsman in relation to underpayment of wages by D’Adamo Nominees;
b)allegations were made about the nature of the employment, and in particular whether Mr Motherwell was or was not an apprentice on and from a particular date;
c)the Fair Work Ombudsman used powers under reg.19.18 of the Workplace Relations Regulations 2006 (Cth)[12] to request time and wages records for Mr Motherwell from D’Adamo Nominees;
d)D’Adamo Nominees provided certain documents in relation to the Fair Work Ombudsman’s request for records, and later supplied other documents relating to Mr Motherwell’s apprenticeship agreement and time and wages records (including, at a late stage, handwritten timesheets for Mr Motherwell which had not previously been provided); and
e)on the basis of the documents provided (but not including, at that stage, the handwritten timesheets referred to above) a Workplace Inspector determined that Mr Motherwell had been employed by D’Adamo Nominees as an electrical assistant under the NAPSA, and subsequently as an apprentice, and that Mr Motherwell had been underpaid wages and accrued annual leave by a certain amount.
[12] “WR Regulations”.
Sometime later these proceedings were instituted. It follows from the fact of their institution that the Fair Work Ombudsman took the view that there was sufficient evidence to institute these proceedings.[13]
[13] Ms Rosendorff’s Affidavit, paras.8-21. There was much to-ing and fro-ing between the Fair Work Ombudsman and D’Adamo Nominees subsequent to the events set out above, but paras.8-21 go to the nub of the factual issues apparently in dispute in these proceedings.
The fact that there was sufficient evidence for the Fair Work Ombudsman, in the Fair Work Ombudsman’s view, to institute these proceedings does not preclude the Fair Work Ombudsman from seeking to place before the Court better evidence if that evidence is available, or possibly available, in answer to the Subpoena. Ultimately, it is in the interests of justice, the administration of justice, and the public interest, that the best possible evidence be put before a Court in a civil penalty proceeding. That is not, and never can be, given the nature of litigation, a matter of perfection in every litigated proceeding, but it is certainly preferable within the constraints of any statutory, or other relevant, limitation. Moreover, it is contrary to the interests of justice, its administration, and the public interest, if a policy requiring sufficient evidence to be available before proceedings are instituted by the Fair Work Ombudsman is interpreted as precluding better evidence from being produced to this Court on a subpoena for the production of documents. There may be exceptions to that general rule, but those exceptions would probably require some form of exceptional circumstance, or prior bad faith, by the party issuing the subpoena for production of documents. Neither of those circumstances exists in this matter.
D’Adamo Nominees also argues that the Subpoena is an abuse of process because it:
a)has been made as part of a fishing expedition, which the Court finds it has not, for reasons already set out;
b)is unnecessary, which the Court finds it is not, for reasons set out below;
c)is oppressive, which the Court finds it is not, for reasons set out below;
d)is a substitute for discovery, which the Court finds it is not, for reasons already set out above; and
e)has the potential to put its sole director at risk of incriminating himself or exposing himself to a penalty, which the Court finds it does not, for reasons set out below.
For all of the above reasons, the objection to compliance with the Subpoena on the basis of abuse of process fails.
Unnecessary
D’Adamo Nominees argues that by reason of the Fair Work Ombudsman exercising statutory powers to require it to produce records and documents relating to employees,[14] it is unnecessary for D’Adamo Nominees to produce documents in response to the Subpoena. It says that the Fair Work Ombudsman has received records and documents relating to employees including Mr Houlihan, but not including Mr Zampogna or the alleged employee named “Anthony”. It therefore argues that the Subpoena with respect to Mr Houlihan is unnecessary because the Fair Work Ombudsman already has records and documents, and further that it has not exercised any further statutory powers since making the request and receiving the documents that it has received. D’Adamo Nominees says that it can therefore be inferred that no records or documents, or alternatively no relevant documents, exist for Mr Zampogna and the alleged employee named “Anthony”.
[14] WR Regulations, reg.19.18.
D’Adamo Nominees’ submission fails to recognise the difference between statutory powers exercised by a bureaucratic body charged with investigating alleged breaches of civil laws, and the powers of a court, acting judicially, to require documents to be produced to the court. In particular, the latter power is to ensure that, where necessary, documents thought by the subpoenaing party to be required in the proceedings are produced to the Court. D’Adamo Nominees’ objection to the Subpoena on the basis of the exercise of statutory powers by the Fair Work Ombudsman therefore fails, because it fails to recognise that those statutory powers of investigation are different to, and for a different purpose from, the powers of the Court to order the production of documents, under r.15A.02(1) of the FMC Rules.[15]
[15] Smith v Granada Tavern & Ors (2007) 208 FLR 455 at 465 per Burchardt FM; [2007] FMCA 263 at paras.62-64 per Burchardt FM (“Granada Tavern”).
The Court is asked to infer that the documents requested in relation to Mr Zampogna and “Anthony” do not exist, seemingly because none were produced to the Fair Work Ombudsman, and because documents related to Mr Houlihan were produced to the Fair Work Ombudsman. The failure to produce documents to the Fair Work Ombudsman in response to the exercise of the Fair Work Ombudsman’s statutory powers in relation to an investigation or inquiry is not a sufficient basis for this Court to infer that no such documents, relevant or otherwise, exist for Mr Zampogna and “Anthony”. That is particularly so when the evidence discloses that as recently as 5 October 2010 the Fair Work Ombudsman’s solicitors wrote to D’Adamo Nominees’ solicitors saying that it would not pursue production of documents under the Subpoena where documents do not exist, and asked for confirmation from D’Adamo Nominees’ solicitors as to whether D’Adamo Nominees contended that the documents under Items 2 and 3 in relation to Mr Zampogna and “Anthony” “do not exist”.[16] Significantly, D’Adamo Nominees’ solicitors’ response provides no answer at all to this request.[17] The Court is entitled to infer that if no such documents did in fact exist then D’Adamo Nominees’ solicitor would have told the Fair Work Ombudsman so, or, confirmed the non-existence of documents in an affidavit filed in this Court, thereby providing an evidentiary basis on which an objection to the Subpoena might be upheld. Neither has occurred, and the Court is not therefore prepared to draw the inference as to the non-existence of documents as sought by D’Adamo Nominees, particularly as D’Adamo Nominees has not led evidence of matters within its knowledge which it was within its power to bring, as to the existence or otherwise of the documents.
[16] Exhibit 2, paras.4.2 and 4.3.
[17] Exhibit 3.
In the circumstances, D’Adamo Nominees’ objections to the Subpoena on the basis that the production of the documents is unnecessary must fail.
Oppressive
D’Adamo Nominees objects to the Subpoena on the basis that it is oppressive. For reasons set out either above or below, objections on the basis that it is oppressive by reason of:
a)a lack of relevance;
b)a requirement to make a judgment;
c)incrimination or exposure to a penalty;
d)fishing;
e)abuse of process; and
f)the Subpoena being too broadly framed and lacking in specificity,
are not made out.
D’Adamo Nominees also argues that:
a)Items 2 and 5 of the Schedule are unlimited in time frame and for that reason are oppressive; and
b)the legal status of the meaning of the term “Apprenticentre WA” is uncertain, and as far as the respondent is aware it has no legal status or existence, and for that reason the Subpoena is oppressive and the respondent is unable to answer the Subpoena in relation to the correspondence referred to in Item 5.
The employment records sought under Item 2 are, under the proposed amended Item 2, quite specific and in respect of a limited number (three) of employees. There is a bare assertion that production is oppressive because of an unlimited time frame. There is no evidence upon which the Court can make a finding of oppression. There is no evidence to enable the Court to determine that the fact that Item 2 is unlimited in time frame makes it oppressive, especially when regard is had to the specific nature of the documents sought, and the small number of employees concerned. Mere assertion is not evidence, and in the absence of any evidence that the task is oppressive (which evidence might have been given on behalf of D’Adamo Nominees), the Court declines to find that it is so.
As to the legal status and meaning of the term “Apprenticentre WA”, the Court has already described D’Adamo Nominees’ submissions on this issue as confused and confusing. There is evidence that “Apprenticentre WA” had some involvement in the administration of Mr Motherwell’s apprenticeship. As the Court has said above, there either will or will not be correspondence to or from a body describing itself as “Apprenticentre WA”. If there is, it must be produced in answer to the Subpoena. If there is not, then there is nothing to produce. It is as simple as that. Therefore, D’Adamo Nominees’ objection on the basis that it is oppressive to have to produce correspondence to and from Apprenticentre WA is rejected.
It follows from the above that the objections of D’Adamo Nominees to production under the Subpoena on the grounds that the Subpoena is oppressive must fail.
Too broadly framed – lacking in specificity
It is convenient to take these two heads of objection together, as their content is essentially the same.
D’Adamo Nominees objects to production of the employment records on the basis that the meaning of “employment records” is too broad, and goes beyond the records that D’Adamo Nominees were required to keep under the WR Act at the relevant time. It is also objected that there is a requirement to make a judgment about the kind of records which might be relevant to the issues between the parties.
The proposed amended Item 2 removes the force of the latter objection, which did have validity for reasons set out above.[18] However, the proposed amended Item 2 requests production of specific employment records, which ought to be available, for three specific employees. In those circumstances it cannot be said to be too broadly framed or to lack specificity. Likewise, the suggestion that D’Adamo Nominees will have to make a judgment about the kinds of records to be produced as employment records cannot stand as a valid objection given the specificity of the records and nomination of three specific employees under the proposed amended Item 2.
[18] See paras.5-6 above.
It is not a ground of objection to producing documents under Subpoena that the records are not records which are required to be kept under the terms of relevant legislation, in this case the WR Act. If that were the case, there would be many documents, in all kinds of civil proceedings, which would escape the net cast by a subpoena to produce documents. There is nothing that the Court was taken to by D’Adamo Nominees, or anything of which the Court is aware, that would indicate that either federal or state parliaments, in legislating to require the maintenance of certain documents, thereby intended to preclude documents not required to be maintained from being the subject of a subpoena to produce in civil proceedings. There is no basis in law or fact for the submission, and the Court rejects it.
D’Adamo Nominees objects to producing “pay records” on the basis that the meaning of the phrase “pay records” is too broad, and possibly goes beyond the records required to be kept by D’Adamo Nominees under the WR Act at the relevant time. For reasons set out above, the latter part of the objection cannot be sustained. The objection to producing pay records on the basis that the meaning is too broad and lacks specificity cannot be sustained either. The pay of an employee “… covers every payment made to the employee in his character as an employee in respect of the performance of the duties of his office or position …”[19] Pay records are specifically those records kept in relation to those payments, and documents related to disputes, controversies or queries concerning those payments. It is a specific category of document, which is neither too broad nor lacking in specificity.
[19] Rogan v Director-General of Technical and Further Education (1987) 10 NSWLR 348 at 350 per McHugh JA (with whom Kirby P and Samuels JA agreed: at 351).
D’Adamo Nominees also objects to production of the Apprenticentre WA correspondence on the basis that Item 5 is too broadly framed or lacking in specificity. For reasons set out above, this objection has no validity at all.
In the circumstances, D’Adamo Nominees’ objection to production under the Subpoena on the basis that the documents sought are too broadly framed or lacking in specificity fails.
Privilege against self-incrimination and/or privilege against exposure to penalty
There is an objection to production under the Subpoena on the basis that production, inspection and copying of the documents referred to in the Subpoena, may incriminate D’Adamo Nominees’ sole director, or expose the director to a penalty.
There is no dispute that D’Adamo Nominees has only one director, and that that director is also the secretary of D’Adamo Nominees. The Subpoena is addressed to the “officer” of D’Adamo Nominees, a description which clearly fits the sole director. D’Adamo Nominees says that the sole director is not a party to the application, but that because he is the only person who, so the argument runs, can produce the documents, he is liable to incriminate himself or expose himself to a penalty because of the accessorial liability provisions of s.728 of the WR Act. Furthermore, because the time to make an application of the type made in this case runs for six years from the alleged breach or alleged underpayment, D’Adamo Nominees says that Mr Motherwell, who would have standing to bring such an action, is still within time to do so. Further, D’Adamo Nominees argues that the request in relation to the three persons named in Item 2 of the Schedule to the Subpoena means that it is possible that the Fair Work Ombudsman, or alternatively those three other persons, might obtain information which then might be used to make similar applications against D’Adamo Nominees, or its sole director.
It is unnecessary to deal with a submission made by the Fair Work Ombudsman that there was another person, or persons, within the organisation of D’Adamo Nominees who could produce these documents. The evidence in that regard is equivocal and not sufficient to make a finding that there is presently a person who could do so.
There is, in the Court’s view, no self-incrimination or exposure to penalty which would arise from compliance with the Subpoena. That is because nothing is required beyond the delivery of documents. There is no need for any testimonial incrimination. In those circumstances, no issue of self-incrimination or exposure to penalty arises.[20]
[20] R v Ronen (2004) 62 NSWLR 707 at 726, 727 and 729 per Mason P; [2004] NSWCCA 67 at paras.97, 106 and 112-114 per Mason P (“Ronen”); Granada Tavern FLR at 465 per Burchardt FM; FMCA at paras.67-68 per Burchardt FM.
In any event, even if production of the documents in accordance with the Subpoena might expose D’Adamo Nominees’ sole director by way of self-incrimination or penalty, that is a situation which might easily be avoided. In Ronen the President of the New South Wales Court of Criminal Appeal observed as follows:
[112] The command of the subpoenas is addressed to the corporations. As legal entities they have independent duties to comply. “Corporate existence implies amenability to legal process” (Wilson (at 374)). If it were shown to be the case (and it has not been thus far) that there is no-one with custody or possession of the records who could lawfully answer the call of the subpoena on the corporations' behalf without risk of testimonial self-incrimination, then the corporations must still take steps to comply. This may mean the appointment of a receiver. Or it may mean that a “proper officer” with nothing to fear by way of self-incrimination has to be appointed (cf United States v Barth 745 F 2d 184 (2d Cir 1984) at 189, cert denied 470 US 1004; Re Two Grand Jury Subpoenae Duces Tecum 769 F 2d 52 (2d Cir 1985); Re Two Grand Jury Subpoenae Duces Tecum 793 F 2d 69 (2d Cir 1986) at 74; Braswell (at 116)).
[113]
For reasons already given, it is not to the point for the appellants to say that they are the present directing minds of the various corporations and that they personally would have to set in train the steps to “outsource” the performance of the duty falling on the corporations. To adapt the language of Lumbard J
speaking for the court in Re Two Grand Jury Subpoenae Duces Tecum 793 F 2d 69 (2d Cir 1986) at 74: “… It is the duty of the [companies], not the [Supreme Court] or the [prosecution], to identify an appropriate custodian to produce subpoenaed documents. If no one may act as custodian without incriminating himself or herself, the firm is required to produce the subpoenaed records by supplying a new agent who has had no previous connection with the firm”.
[114] At the end of the day, the oppression argument is an attempt by the appellants to frustrate the subpoenas by suggesting that they trench upon the appellants' rights. This is to shift the proper focus of inquiry. The corporations are not free to select an individual to be their proper officer “ ‘… who because he fears self-incrimination may thus secure for the corporation the benefits of a privilege it does not have’. Such a result would effectively permit the corporation to assert on its own behalf the personal privilege of its individual agents” (United States v Kordel 397 US 1 (1969) at 8).[21]
[21] Ronen NSWLR at 729 per Mason P; NSWCCA at paras.112-114 per Mason P.
In Granada Tavern this Court observed that it would be prepared to appoint a “receiver” for the purpose of having documents produced under subpoena.[22] D’Adamo Nominees has proposed an order for a “receiver” as one possible order in relation to this matter.
[22] Granada Tavern FLR at 465 per Burchardt FM; FMCA at para.68 per Burchardt FM.
In all the circumstances of this case, and bearing in mind:
a)the nature of the defence being run by D’Adamo Nominees; and
b)the objects of the Federal Magistrates Act 1999 (Cth)[23] and FMC Rules, and in particular the requirement to run proceedings efficiently, economically and without protraction,[24]
the Court has decided that it would be appropriate to direct D’Adamo Nominees to appoint an agent, who can produce the documents on behalf of D’Adamo Nominees to the Court under r.15A.15(a) of the FMC Rules.[25] The agent would be required to be appointed by D’Adamo Nominees forthwith, and to produce the documents in compliance with the Subpoena (as amended hereunder) by 4.00pm on 8 November 2010.
[23] “FM Act”.
[24] FM Act, ss.3 and 42; FMC Rules, r.1.03.
[25] Rule 15A.15 of the FMC Rules provides that:
It follows from the foregoing that D’Adamo Nominees’ objection to production under the Subpoena on the basis that its sole director might incriminate himself or expose himself to a penalty can be avoided, and the objection must therefore fail.
Amendments
Given that, for reasons set out above, Item 2 of the Schedule to the Subpoena was too wide in its terms, the Court considers it appropriate to order that the terms of Item 2 be amended in accordance with the alternative terms suggested by Counsel for the Fair Work Ombudsman at hearing, and which are set out above. There should also be minor amendments to:
a)Item 2(c) to delete the words “we are not aware of this employee’s surname” as those words are unnecessary, and appear to have been incorporated as part of a transposition error from correspondence between the parties; and
b)by deleting the words “between your client and” and substituting the word “with” in Item 5, which again appears to be necessary by reason of a correspondence transposition error.
Conclusion
Apart from the objection to Item 2 of the Schedule to the Subpoena as it was originally cast, D’Adamo Nominees’ objections to production under the Subpoena fail. D’Adamo Nominees’ objections to the proposed amended Item 2 also fail. In the circumstances, save for the proposed amended Item 2, and the other minor amendments arising from transposition errors, there will be an order dismissing the objections to production under the Subpoena.
There will also be an order requiring D’Adamo Nominees to:
a)forthwith appoint an agent for the purposes of compliance with the Subpoena; and
b)produce the documents in accordance with the Subpoena, as amended by reason of the Court’s orders, by 4.00pm on 8 November 2010.
The Court will hear the parties as to costs.
I certify that the preceding fifty-six (56) paragraphs are a true copy of the reasons for judgment of Lucev FM
Date: 4 November 2010
“If a person is served with a subpoena for production:
(a) the person, or the person’s agent, must produce the documents or things described in the subpoena at the registry stated in the subpoena; and
(b) …”
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