Fourteen Consulting Services Pty Ltd (in liq) v A.O.B Holding Pty Ltd (in liq) (No 4)
[2024] FCA 159
•22 February 2024
FEDERAL COURT OF AUSTRALIA
Fourteen Consulting Services Pty Ltd (in liq) v A.O.B Holding Pty Ltd (in liq) (No 4) [2024] FCA 159
File number(s): NSD 331 of 2023 Judgment of: HALLEY J Date of judgment: 22 February 2024 Date of publication of reasons: 28 February 2024 Catchwords: PRACTICE AND PROCEDURE – application for leave to serve documents outside Australia pursuant to r 10.44 of the Federal Court Rules 2011 (Cth) – where service to be effected in accordance with the Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters done at the Hague on 15 November 1965 – application granted. Legislation: Corporations Act2001 (Cth) ss 109X(1), 597(9)
Federal Court of Australia Act 1976 (Cth) ss 37AF(1)(b), 37AJ
Federal Court Rules 2011 (Cth) rr 10.02, 10.44, 10.45, 10.46
Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters done at the Hague on 15 November 1965
Cases cited: Fourteen Consulting Services Pty Ltd (in liq) v A.O.B. Holdings Pty Ltd [2023] FCA 704
Giraud v Albarran (liquidator), in the matter of Digital Infrastructure Pty Ltd (in liq) (2021) 156 ACSR 236; [2021] FCA 1274
Krejci in his capacity as liquidator of Myoora Land Pty Ltd (in liq) v Myoora Land Pty Ltd [2023] FCA 620
McCabe, in the matter of Sargon Capital Pty Limited (receivers and managers appointed) (in liq) [2023] FCA 112
McCabe, in the matter of Sargon Capital Pty Ltd (receivers and managers appointed) (in liq) (No 2) [2023] FCA 1465
Division: General Division Registry: New South Wales National Practice Area: Commercial and Corporations Sub-area: Corporations and Corporate Insolvency Number of paragraphs: 28 Date of hearing: 22 February 2024 Counsel for the Plaintiffs: Mr R W Notley Solicitor for the Plaintiffs: ERA Legal ORDERS
NSD 331 of 2023 IN THE MATTER OF FOURTEEN CONSULTING SERVICES PTY LTD (IN LIQUIDATION) (ACN 625 923 297) & ORS
BETWEEN: FOURTEEN CONSULTING SERVICES PTY LTD (IN LIQUIDATION) (ACN 625 923 297)
First Plaintiff
BOON BUSINESS CONSULTANTS PTY LTD (ACN 634 124 315)
Second PlaintiffAND: A.O.B HOLDING PTY LTD (ACN 632 922 046)
Second Defendant
HENPARK HOLDINGS PTY LTD (IN LIQUIDATION) (ACN 624 401 029)
Third Defendant
NPC ADVISORY (SD) PTY LIMITED (ACN 158 241 546) (and others named in the Schedule)
Fourth Defendant
ORDER MADE BY:
HALLEY J
DATE OF ORDER:
22 FEBRUARY 2024
THE COURT ORDERS THAT:
1.The order made by Registrar O’Connor on 20 February 2024 in these proceedings, be vacated.
2.Pursuant to s 37AF(1)(b) and s 37AJ of the Federal Court of Australia Act 1976 (Cth) (the Act), for a period of 3 years or until further order of the Court, the information in the following document is to be kept confidential and not published or otherwise disclosed to any person other than Mr Vardy, Mr Vardy’s legal representatives (including Mr Vardy’s solicitors and barristers and any support staff of those solicitors and barristers) and Mr Vardy’s servants, agents or employees and the Court (and any Court staff or any other person assisting the Court), on the grounds that this order is necessary to prevent prejudice to the proper administration of justice under s 37AG(1)(a) of the Act:
(a)paragraphs 1 to 20 of the affidavit of Darren John Vardy affirmed on 8 February 2024 and the annexures to those paragraphs.
3.Pursuant to r 10.44 of the Federal Court Rules 2011 (Cth), leave be granted to the plaintiffs to serve the following documents:
(a)the order for production on Apple Inc. referred to in paragraph 1(b) of the orders made by Registrar O’Connor on 14 February 2024; and
(b)sealed copies of the orders made by Registrar O’Connor on 14 February 2024 and these orders;
upon Apple Inc. in the United States of America by international pre-paid registered post addressed to Apple Inc. at 20705 Valley Green Drive, Cupertino, California, United States of America, 95014 and to Apple Inc. at One Apple Park Way; Cupertino, CA 95014, California, United States of America, in accordance with Article 10(a) of the “Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters” done at the Hague on 15 November 1965.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
A. INTRODUCTION
By an interlocutory process filed on 9 February 2024, Darren John Vardy sought leave pursuant to r 10.44 of the Federal Court Rules 2011 (Cth) (Rules) to serve an order for production of documents overseas on Apple Inc. (Apple), a corporation based in the United States of America (application).
Mr Vardy is the liquidator of the first plaintiff, Fourteen Consulting Services Pty Ltd (in liquidation) (Fourteen), the second plaintiff, Boon Business Consultants Pty Ltd (in liquidation) (Boon), and each of the defendants.
The application is supported by a confidential affidavit from Mr Vardy affirmed on 8 February 2024, the affidavit of Mr Vardy’s solicitor, Blake O’Neill affirmed on 12 September 2023 and a document entitled Legal Process Guidelines for Government and Law Enforcement within the United States (Apple Service Guidelines).
On 14 February 2024, a Registrar of this Court made orders for production of documents from both Apple and Apple Pty Ltd. Mr Vardy, however, required leave of the Court to serve the order for production on Apple (Order for Production) overseas and the application was therefore referred to me for determination.
On 20 February 2024, the Registrar made a suppression order pursuant to s 37AF(1)(b) and s 37AJ of the Federal Court of Australia Act 1976 (Cth) with respect to the information contained in Mr Vardy’s affidavit. In the course of the hearing of the application before me on 22 February 2024, I made an order, at the request of Mr Vardy, varying the suppression order to exclude paragraphs 21 to 26 of Mr Vardy’s affidavit from the order. Those paragraphs were directed at establishing the address at which Apple could be served and annexed documents establishing that the United States was a party to the “Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters” concluded at the Hague on 15 November 1965 (Hague Service Convention) and related matters.
On 22 February 2024, at the conclusion of the hearing of the application, I made an order for the service on Apple of the Order for Production in substantially the form sought by Mr Vardy.
These are my reasons for making that order.
B. BACKGROUND
For present purposes it is sufficient to provide the following background to the application.
On 15 March 2023, Fourteen was wound up by an order of the Supreme Court of New South Wales and Mr Vardy was appointed liquidator.
On 19 May 2023, Boon was wound up by an order of this Court and Mr Vardy was appointed as liquidator.
Mr Vardy was subsequently appointed as a liquidator to each of the companies that are now defendants to these proceedings.
Based on his investigations to date, Mr Vardy has formed the view that:
(a)Boon and Fourteen, together with the defendants (Scheme Participants), were part of a broader scheme (Scheme) which sought to benefit Samuel Henderson and/or his family by using the proceedings of a complex tax avoidance scheme involving Titan Cranes & Rigging Pty Ltd (Titan Cranes);
(b)the Scheme involved the Scheme Participants:
(i)providing labour hire and payroll services to, predominantly, Titan Cranes (Labour Hire Business);
(ii)as part of the Labour Hire Business, receiving revenues or fruits from a broader scheme with Titan Cranes designed to avoid the payment of statutory liabilities, such as Pay As You Go (PAYG) withholding, in respect of the labour force employed as part of the Labour Hire Business, primarily for the benefit of Titan Cranes; and
(iii)using the tainted gains to purchase real property and make investments through one or more of the Scheme Participants, often with those funds being recorded through multiple inter-company transactions and loans; and
(c)the late Mr Henderson was, prior to his death on 4 April 2023, the controlling mind or at least one of the controlling minds of the group of companies involved in the Scheme (which included Boon and Fourteen).
The elements of the Scheme were more comprehensively outlined by Jackman J in Fourteen Consulting Services Pty Ltd (in liq) v A.O.B. Holdings Pty Ltd [2023] FCA 704 at [3]-[5]. For present purposes, the explanation of the Scheme at [12] above is sufficient.
On 23 June 2023, the Court made orders, inter alia, for the issue of summonses for examination and orders for production addressed to various persons, including Damon Hanlin, the director of Titan Cranes.
Between 6 November 2023 and 10 November 2023, Mr Vardy conducted the public examinations referred to above. Mr Hanlin was examined on 10 November 2023 and, at the conclusion of his examination on 10 November 2023, his examination was adjourned generally with liberty to seek the resumption of the examination within six months.
The Order for Production sought, inter alia, any data stored on Mr Henderson’s iCloud account, including any device or iMessage backups and any encryption keys required to recover that data. An order was also made by the Registrar on 14 February 2024 for the issue of an order for production addressed to Apple Pty Ltd, an Australian subsidiary of Apple.
C. RELEVANT LEGAL PRINCIPLES
Rule 10.44(1) of the Rules provides that:
Any document other than an originating application may be served outside Australia with the leave of the Court, which may be given with any directions that the Court considers appropriate.
Rule 10.46 allows service on a person outside Australia to be made in accordance with the law of the country concerned, including if that law does not require personal service, and r 10.45(b)(ii) allows service on a person outside Australia in the same way as the Rules apply to persons in Australia, to the extent its provisions are relevant and consistent with Div 10.4 of the Rules and the Hague Service Convention, if it applies.
Relevantly, Article 10(a) and Article 10(b) of the Hague Service Convention provides:
Provided the State of destination does not object, the present Convention shall not interfere with—
(a)the freedom to send judicial documents, by postal channels, directly to persons abroad,
(b)the freedom of judicial officers, officials or other competent persons of the State of origin to effect service of judicial documents directly through the judicial officers, officials or other competent persons of the State of destination.
Rule 10.02 of the Rules provides that a document that is to be served personally on a corporation must be served in accordance with s 109X(1) of the Corporations Act2001 (Cth) (Corporations Act), which provides that a document may be served on a company by, relevantly, posting it to the company’s registered office.
As submitted by Mr Vardy, the Court has previously granted leave to serve examination summonses and orders for production on individuals and entities based overseas under r 10.44 of the Rules (or its predecessor): McCabe, in the matter of Sargon Capital Pty Ltd (receivers and managers appointed) (in liq) (No 2) [2023] FCA 1465 (Stewart J); McCabe, in the matter of Sargon Capital Pty Limited (receivers and managers appointed) (in liq) [2023] FCA 112 (Cheeseman J); Krejci in his capacity as liquidator of Myoora Land Pty Ltd (in liq) v Myoora Land Pty Ltd [2023] FCA 620 (Rares J).
In short, the Court must be satisfied that the categories of material sought in an order for production appear to be relevant to matters to which the examination relates or will relate, to the extent that they are in the possession of the person to whom the order for production is issued: Myoora Land at [28], [38].
The same principles apply to the issue of an order for production under s 597(9) of the Corporations Act to the issue of an order for production under r 30.34 of the Rules: Giraud v Albarran (liquidator), in the matter of Digital Infrastructure Pty Ltd (in liq) (2021) 156 ACSR 236; [2021] FCA 1274 at [33]-[34] (Derrington J).
D. CONSIDERATION
I am satisfied that paragraphs 21 to 26 of Mr Vardy’s affidavit and the annexures referred to in those paragraphs, including the Hague Service Convention and extracts from the website of the Hague Conference on Private International Law, establish that:
(a)Apple is located at One Apple Park Way, Cupertino, California, United States of America;
(b)Article 10(a) of the Hague Service Convention provides that if the State of destination does not object, the convention shall not interfere with the freedom to send judicial documents, by postal channels, directly to persons abroad;
(c)the United States of America ratified the Hague Service Convention on 24 August 1967, and it entered into force in the United States of America on 10 February 1969; and
(d)the United States of America has no opposition to Article 10(a) of the Hague Service Convention.
I note that the Apple Service Guidelines state that documents that are required to be served personally on Apple may be served at Apple’s Cupertino, California headquarters at Apple “20705 Valley Green Drive, Cupertino, CA, 95014”.
I therefore concluded that service of the Order for Production on Apple could be effected under Article 10(a) of the Hague Service Convention by sending it by post to Apple at both, One Apple Park Way, Cupertino, California, United States of America and 20705 Valley Green Drive, Cupertino, California, 95014, United States of America.
I am also satisfied, based on the matters outlined above at [1] to [16] and the suppressed confidential information in Mr Vardy’s affidavit, that the categories of material sought by Mr Vardy in the Order for Production appear to be relevant to matters to which the examination of Mr Hanlin relates or will relate, in that there may be communications in Mr Henderson’s iCloud account between Mr Henderson and Mr Hanlin that are relevant to the examinable affairs of Fourteen and Boon.
E. DISPOSITION
For the reasons set out above, I concluded that an order should be made pursuant to r 10.44 of the Rules granting leave to serve the Order for Production on Apple in the United States of America substantially in the form sought in the application.
I certify that the preceding twenty-eight (28) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Halley. Associate:
Dated: 28 February 2024
SCHEDULE OF PARTIES
NSD 331 of 2023 Respondents
Fifth Defendant:
FIFTEEN INVESTMENTS PTY LIMITED (IN LIQUIDATION) (ACN 158 241 546)
Sixth Defendant:
GOLDEN OX TAVERN PTY LTD (IN LIQUIDATION) (ACN 660 304 147)
Seventh Defendant:
NPC ADVISORY PTY LTD (IN LIQUIDATION) (ACN 634 205 306)
Eighth Defendant:
ULTIMATE LABOUR HIRE PTY LTD (IN LIQUIDATION) (ACN 635 852 630)
Ninth Defendant:
NPC ADVISORY CORPORATE PTY LTD (IN LIQUIDATION) (ACN 651 525 209)
Tenth Defendant:
NPC ADVISORY (TC) PTY LTD (IN LIQUIDATION) (ACN 651 525 192)
Eleventh Defendant:
SHEEHAN CONSTRUCTION SERVICES 1 PTY LTD (IN LIQUIDATION) (ACN 646 390 114)
Twelfth Defendant:
REDWOOD CONSTRUCTION SERVICES (Y&H) PTY LTD (ACN 650 150 646)
Thirteenth Defendant:
REDWOOD CONSTRUCTION SERVICES (SA/TAS) PTY LTD (ACN 632 868 494)
Fourteenth Defendant:
REDWOOD CONSTRUCTION SERVICES (QLD) PTY LTD (ACN 651 504 139)
Fifteenth Defendant:
REDWOOD CONSTRUCTION SERVICES (NSW) PTY LTD (ACN 650 150 262)
Sixteenth Defendant:
REDWOOD CONSTRUCTION SERVICES (MULGRAVE) PTY LTD (ACN 640 776 674)
Seventeenth Defendant:
REDWOOD CONSTRUCTION SERVICES (CW) PTY LTD (ACN 650 150 431)
Eighteenth Defendant:
REDWOOD CONSTRUCTION SERVICES (AUST) PTY LTD (ACN 640 776 370)
Nineteenth Defendant:
REDWOOD CONSTRUCTION SERVICES (VIC} PTY LTD (FORMERLY KNOWN AS REDWOOD CONSTRUCTION SERVICES 6 PTY LTD (ACN 632 870 412)
Twentieth Defendant
152 INVESTMENTS PTY LTD (IN LIQUIDATION)
(ACN 651 524 784)
Twenty First Defendant
ACN 643 244 982 PTY LIMITED (IN LIQUIDATION)
(ACN 643 244 982) (FORMERLY NPC ADVISORY(AUSTRALIA) PTY LIMITED)
Twenty Second Defendant
FT FINANCE & CAPITAL PTY LIMITED (IN
LIQUIDATION) (ACN 640 740 594)
Twenty Third Defendant
MCFE INVESTMENTS PTY LIMITED (IN
LIQUIDATION) (ACN 639 293 673)
Twenty Fourth Defendant
MCFE GLOBAL PTY LIMITED (IN LIQUIDATION)
(ACN 646 966 127)
Twenty Fifth Defendant
MCFE INVESTMENTS PTY LIMITED (IN
LIQUIDATION) (ACN 639 293 673)
Twenty Sixth Defendant
NPC ADVISORY BLUE PTY LTD (IN LIQUIDATION) (ACN 666 606 435)
Twenty Seventh Defendant
NPC BLACKHEAD PTY LIMITED (IN LIQUIDATION)
(ACN 647 519 006)
Twenty Eighth Defendant
NPC ELIZABETH AVE BROADBEACH PTY LTD (IN
LIQUIDATION) (ACN 660 351 717)
Twenty Ninth Defendant
NPC GOLDEN OX PTY LTD (IN LIQUIDATION)
(RECEIVER AND MANAGER APPOINTED) (ACN 659452 650)
Thirtieth Defendant
NPC KINGSCLIFF PTY LIMITED (IN LIQUIDATION)
(ACN 651 525 138)
Thirty First Defendant
NPC MACDONNELL RD PTY LTD (IN
LIQUIDATION) (ACN 651 525 254)
Thirty Second Defendant
NPC MCCULLOCH AVE PTY LIMITED (IN
LIQUIDATION) (ACN 659 452 829)
Thirty Third Defendant
PROGRESSIVE PEOPLE (AUSTRALIA) PTY LIMITED
(IN LIQUIDATION) (ACN 068 516 343)
Thirty Fourth Defendant
SIMPLE LIFE.COM PTY LTD (IN LIQUIDATION)
(ACN 668 098 959)
Thirty Fifth Defendant
WHITE FIG REHABILITATION & RECOVERY PTY
LTD (IN LIQUIDATION) (ACN 661 547 093)
Thirty Sixth Defendant
AUSTRALIAN LENDING AND FINANCE PTY LTD
(PROVISIONAL LIQUIDATOR APPOINTED) (ACN608 620 622)
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