Instyle Estate Agents Gungahlin Pty Ltd v Hambrook (No. 2)
[2020] ACTSC 293
•26 October 2020
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: | Instyle Estate Agents Gungahlin Pty Ltd v Hambrook (No. 2) |
Citation: | [2020] ACTSC 293 |
Hearing Dates: | 9 and 14 October 2020 |
DecisionDate: Reasons Date: | 22 October 2020 26 October 2020 |
Before: | McWilliam AsJ |
Decision: | 1. The subpoenas issued to MGI JOYCE!DICKSON Pty Ltd (ACN 615 645 200), Realist8 Agent Services Pty Ltd (ACN 606 662 408), and Jamie McDonell Real Estate Pty Ltd (ACN 154 243 955) are set aside. 2. Costs of the application are reserved. |
Catchwords: | PRACTICE AND PROCEDURE – SUBPOENAS – Application to set aside subpoenas issued to the plaintiff’s accountant and corporate entities with a director in common with the plaintiff – whether the subpoenas seek documents beyond the relevant scope of the proceedings – whether legitimate forensic purpose – whether apparent or adjectival relevance |
Legislation Cited: | Corporations Act 2002 (Cth) ss 233, 237, 241, 242 Court Procedure Rules 2006 (ACT) r 6604 |
Cases Cited: | A Pty Ltd v Z [2007] NSWSC 999 |
Parties: | Instyle Estate Agents Gungahlin Pty Ltd (ACN 600 193 762) (Plaintiff) Richard James Hambrook (Defendant) |
Representation: | Counsel Mr D Robens (Plaintiff) Mr J Masters (Defendant) |
| Solicitors Harrington Hall Lawyers O’Connor Harris & Co | |
File Number: | SC 502 of 2017 |
McWilliam AsJ:
The parties to the interlocutory application concerning subpoenas presently before the Court are involved in litigation which is listed for a five-day hearing to commence on 26 October 2020.
The plaintiff, Instyle Estate Agents Gungahlin Pty Ltd (ACN 600 193 762) (Instyle), is a company involved in marketing and selling residential real estate, in particular for apartment developments in the Territory.
The defendant, Mr Richard Hambrook, was a director of Instyle from 18 June 2014 (when the company was registered) to 11 September 2017, when he was removed by way of a company resolution. The current directors of Instyle are Mr Jaime Farrelly and Mr Jamie McDonell. Before Mr Hambrook was removed as a director, and save for a period from 17 February 2015 until 15 January 2016, Mr Hambrook was the sole director of Instyle. He remains a current shareholder.
The substantive proceedings
There are two proceedings listed for hearing together. In the first (SC 502 of 2017), Instyle is suing Mr Hambrook to recover monies it says Mr Hambrook improperly paid to himself when he was a director, over the period between 2 July 2015 and 11 September 2017. The claim is brought in equity for breach of fiduciary duty and under the Corporations Act 2002 (Cth) (the Corporations Act) for breach of director’s duties. Instyle is seeking statutory compensation or equitable remedies in the alternative
In defence of the claim, Mr Hambrook admits that he caused Instyle to make certain payments to him but denies that any of the payments were improper. Further, Mr Hambrook counter-claims, by way of set-off, the payment of commission to which he says he was contractually entitled. The claimed commission relates to three developments for which contracts had been exchanged prior to Mr Hambrook’s termination as director, described in the pleading as sales in the following developments:
(a) “Maison 1”, a development in Moncrieff (with at least $35,584.80 in commission claimed);
(b) “Maison 2”, also a development in Moncrieff (with at least $71,175.40 in commission claimed); and
(c) “Throsby” (with at least $31,680 in commission claimed).
As at the date of Mr Hambrook’s termination, Mr Hambrook had not been paid the commission to which he says he is lawfully entitled, and it has not been paid since. Mr Hambrook further seeks employment entitlements such as payment in lieu of notice, and severance pay.
Separate proceedings (SC 303 of 2018) have been commenced by Mr Hambrook against Instyle. In those proceedings, and pursuant to s 233 of the Corporations Act, Mr Hambrook seeks relief from oppression in his capacity as a minority shareholder of Instyle. He alleges that Instyle was entitled to the payment of commissions totalling approximately $680,000 in each of the three developments referred to in the counter-claim and above (at [5]). The companies involved in the developments said to give rise to the payment of commission are:
(a) 3 Property Group 1 Pty Ltd ACN 147 419 592 (3 Property Group) in respect of the “Maison 1” and “Maison 2” developments; and
(b) Lifestyle Homes (ACT) Pty Ltd, ACN 144 578 996 (Lifestyle Homes) in respect of the “Throsby” development.
If 3 Property Group and Lifestyle Homes paid Instyle the commission Mr Hambrook asserts should have been paid, that would in turn have allowed the payment of a significant dividend to Instyle’s shareholders.
Besides Mr Hambrook, the shareholders of Instyle are:
(a) Stormer Corporation Pty Ltd (ACN 140 024 611) (Stormer), whose sole director and shareholder is Mr Farrelly;
(b) KFT Group (ACT) Pty Ltd (ACN 121 705 495) (KFT) whose sole director and shareholder is Mr Gary Kelly; and
(c) Jamie McDonell Real Estate Pty Ltd (ACN 154 243 955) (JMRE) whose two directors and shareholders are Mr McDonell and Mrs Rebecca McDonell.
In order to better understand the detail of the underlying dispute giving rise to the subpoenas, it is also important to note that Stormer and KFT are significant shareholders in 3 Property Group. As a consequence, Mr Farrelly and Mr Kelly are effectively the main shareholders in 3 Property Group. Mr Farrelly is its director.
With regard to Lifestyle Homes, KFT is its sole shareholder and Mr Kelly is its sole director.
At a practical level then, while Mr Hambrook would benefit significantly from 3 Property Group and Lifestyle Homes paying commission to Instyle (assuming a dividend was then paid to Instyle’s shareholders), Mr Farrelly and Mr Kelly would not benefit, as the said companies would effectively be paying themselves and otherwise diluting their funds in paying Mr Hambrook and JMRE.
The primary relief sought by Mr Hambrook, in what I will describe as the oppression suit, is that pursuant to s 233(j) of the Corporations Act, the present directors of Instyle be required to use their best endeavours to call in the payment of the outstanding commissions to Instyle. If that does not occur, Mr Hambrook seeks:
(a) Leave of the Court pursuant to s 233(g) of the Corporations Act, or alternatively pursuant to s 237 of the Corporations Act, to institute and conduct proceedings in the name of Instyle for the purpose of seeking payment of the outstanding commissions; and
(b) Pursuant to either s 241(1)(c) or 242 of the Corporations Act, a further order that any such proceedings be funded through the funds of Instyle.
Mr Hambrook alleges a number of breaches of fiduciary and statutory director’s duties, which he says means that the affairs of Instyle are being conducted contrary to the interests of the members as a whole and/or in a discriminatory manner to him.
The present application
In preparation for the now imminent hearing, Mr Hambrook issued a number of subpoenas in July 2020. Three of the subpoenas issued are the subject of the plaintiff’s present application, which is to set them aside. Due to the timing of the application being heard so close to the hearing, the orders of the Court have already been made, with these reasons to follow.
The first subpoena was issued to the proper officer of MGI Joyce!Dickson Pty Ltd (ACN 615 645 200) (Joyce Dickson), the plaintiff’s accountant. The schedule to the subpoena seeks all documents pertaining to the company with ACN 600 193 762 being Instyle or any former name, including InStyle Estate Agents Pty Ltd.
The second subpoena was issued to Realist8 Agent Services Pty Ltd (ACN 606 662 408) (Realist8), a company whose director and shareholder is Mr McDonell. The documents sought under that subpoena are in summary, all account statements for any type of bank account held over the period 1 January 2015 to 31 October 2019 and all invoices issued to the following entities over the same period:
(a) Tiger Property Group Pty Ltd;
(b) 3 Property Group No 1 Pty Ltd;
(c) 3 Property Group Pty Ltd;
(d) Project Property Group ACT Pty Ltd;
(e) Lifestyle Homes;
(f) Stormer; and
(g) KFT.
A third subpoena has been issued to the proper officer of JMRE, containing a schedule seeking documents in terms similar to the subpoena issued to Realist8.
Instyle seeks to set aside the subpoenas on four grounds:
(1)The subpoenas have no apparent legitimate forensic purpose;
(2)The subpoenas are in effect seeking discovery from non-parties, or alternatively, the terms of the subpoenas are impermissibly wide so as to constitute ‘fishing’;
(3)The terms of the schedules to each subpoena are so wide as to be oppressive; and
(4)The defendant has failed to pay both conduct money and money for the reasonable expenses of production.
The Court’s power and applicable principles
The Court has power to set aside a subpoena, in whole or in part, on application of a party, pursuant to r 6604 of the Court Procedure Rules 2006 (ACT) (Rules).
With regard to the first to third grounds of challenge, a subpoena will be set aside if there is no legitimate forensic purpose (including a lack of relevance) or the subpoena is seriously and unfairly burdensome or prejudicial: Trade Practices Commission v Arnotts (1989) 88 ALR 90 (Arnotts) at 103.The test for relevance is whether production of the documents would be reasonably likely to add in the end to the relevant evidence in the case, including apparent or adjectival relevance, in the sense that the documents could ‘possibly throw light on the issues in the main case’ (being the language used by Beaumont J in Arnotts at 103), or that it is ‘on the cards’ that they could do so: Portal Software v Bodsworth [2005] NSWSC 1115 (Portal Software) at [24]. See also DPP v Warren [2015] ACTSC 111 at [22] and Elmaraazey v Capital Lawyers Pty Ltd [2016] ACTSC 54 at [44] where Mossop AsJ (as his Honour then was) cited in addition Spencer Motors Pty Ltd v LNC Industries Ltd [1982] 2 NSWLR 921 at 926–927 and Re North Coast Transit Pty Limited [2013] NSWSC 1912 at [7]–[9].
When assessing what meets the threshold for relevance, although a mere ‘fishing’ expedition is impermissible, it will be sufficient if it appears to be ‘on the cards’ that the documents will materially assist the defence: Alister v R (1984) 154 CLR 404 at 414. The principle has been stated in different ways in numerous authorities, but from the above it can be seen that the threshold for relevance of the documents sought under a subpoena is low.
In Portal Software, having referred to both Arnotts and Alister v R, among other authorities, Brereton J (as his Honour then was) stated at [27]:
The two questions considered by Beaumont J which arise on an application to set aside a subpoena as oppressive - namely, the first question as to relevance which looks at the legitimate forensic interest of the party issuing the subpoena, and the second as to burden or prejudice which looks at the burden imposed on the recipient of the subpoena – mean that the exercise will often involve balancing the potential utility of the material sought against the burden which compliance with the subpoena will cast on the recipient.
The party issuing the subpoena bears at least a forensic onus of showing the relevance of the documents sought to the issues in the proceedings: Portal Software at [29] and the cases there-cited.
A subpoena may be set aside if it is used for the purpose of obtaining discovery against a third party or to obtain discovery against a party, or where to compel the person named to comply with the subpoena would be oppressive: Commissioner for Railways v Small (1938) 38 SR (NSW) 564 at 573, 575. Although similar considerations which apply to the setting aside of subpoenas are applicable to notices to produce (see Portal Software at [10] and the cases there-cited), the distinction between obtaining documents through subpoena or discovery is important. In the former case, the recipient of the subpoena is ordered to produce the documents specified, without any knowledge about the issues in the proceedings to which the subpoena relates. In the latter case of discovery, the person or party obliged to discover documents must engage with the material being produced, deciding whether they relate to the issues in the action: Lucas Industries Ltd v Hewitt (1978) 18 ALR 555 at 569.
The fourth ground of challenge deals with conduct money and reasonable expenses. Conduct money is defined in the Dictionary in the Rules to mean an amount of money or its equivalent sufficient to meet the reasonable expenses of the addressee of attending as required by the subpoena and returning after attending.
As to what constitutes reasonable expenses, the expenses that may be allowed include the time incurred in dealing with the subpoena, legal advice reasonably incurred in relation to confidentiality and privilege issues pertaining to the subpoena, and the cost of photocopying: see Brereton J in A Pty Ltd v Z [2007] NSWSC 999 at [45] and the cases there-cited.
In the present case, the complaint is about lack of payment. The payment of reasonable expenses was discussed in Foyster v Foyster Holdings [2003] NSWSC 881 (Foyster) by Campbell J (as his Honour then was) at [12]:
…the person issuing a subpoena should bear all reasonable expenses and loss involved in complying with it, unless the expense or loss incurred beyond the amount tendered at time of service of the subpoena is so slight that it can fairly be ignored. Subpoenas involve the exercise of a significant compulsive power, and they are issued by the Court on request, without any pre-screening of the appropriateness of the orders so made. …
That passage was referred to by Robb J in Zaki Property Pty Ltd v ACE Australian Construction Experts Pty Ltd [2018] NSWSC 976 at [35] as part of a detailed discussion about the payment of reasonable expenses. His Honour went on to state at [38], [41] and [42] (emphasis added):
[38] It may be rare that a moral emerges out of the resolution of a dispute. Arguably, the present is a case where it has. Parties to proceedings from time to time need to serve subpoenas on third parties. Sometimes compliance is inexpensive, but often it will cost a significant amount. That amount, even if ultimately found to be reasonable, may not be easily forecast by the issuing party's lawyers. Thus, those lawyers take a risk that their client will have to bear. On the other hand, where the third party is represented by lawyers, those lawyers take a risk on behalf of their client, if they permit their client to incur significant costs of complying with the subpoena without first ensuring that those costs will be met by the issuing party. The moral is that, except in easily predictable cases, the lawyers for both parties must be astute to communicate with the other reasonably and openly to achieve the objectives described above. First, wherever possible agreement should be reached before costs are incurred, because the incurring of costs without agreement will promote dispute. Secondly, where costs are incurred, genuine negotiation is required to ensure that the amount of compensation reflects the nature of the compliance that was reasonably necessary.
…[41] The problem for the party issuing the subpoena will often be one of ignorance about the number of documents potentially falling within the categories in the subpoena, the ease with which the recipient will be able to identify and collate those documents within its record-keeping system, or the seniority of the officers of the recipient and the time that will be required to make judgments about, first, what documents truly fall within the categories required to be produced, and secondly, whether the recipient has good grounds for resisting the production of some or all of the documents sought. Accordingly, while on the one hand the third party recipient of the subpoena, who is placed under compulsion to answer it, should not have to bear the costs of the involuntary assistance that it is required to give in the judicial process, on the other hand there is considerable scope for parties to proceedings who must subpoena third parties to obtain necessary evidence to be visited with unexpectedly onerous obligations to pay the costs of compliance incurred by the recipients of subpoenas.
[42] The ultimate objective of the process of determining the costs that should be paid to third-party recipients of subpoenas must therefore be to achieve the optimal balance between the production of documents necessary for the party's case, while at the same time facilitating transparency as to the ultimate cost, and then encouraging the party and the recipient to agree upon the proper compensation, without drawing the Court into the need to resolve disputes unnecessarily.
Those observations appear to have particular force in the present case.
The power to grant ‘other relief’
Under r 6604 of the Rules, the Court may also “grant other relief in relation to a subpoena”. In Jones v University of Canberra (No 3) [2016] ACTSC 186, Refshauge J was not satisfied about the Court’s power to amend a subpoena other than as to the return date (at [67]-[68]).His Honour was there being asked to enlarge the terms of a subpoena. It has been held in other jurisdictions that the same words of the equivalent procedural rule are wide enough to permit the court to make an order limiting the scope of production required by a subpoena: see, for example, A Pty Ltd v Z at [41] and Ryan v Commercial and Residential Developments (SA) Pty Ltd [2013] FCA 656 at [21].
Counsel for the defendant submitted that if the Court was otherwise satisfied about the relevance of the documents sought, the Court had the power to limit the scope of the documents required to be produced so as to ameliorate any other concerns about discovery, oppression and the expenses of production. The submission, as I understood it, appeared to extend to an argument that the words “grant other relief in relation to a subpoena” were broad enough to allow the Court to make an order treating the subpoena as if it were a notice to produce. I will return to that matter below at [44] of these reasons.
Should the subpoena to Joyce Dickson be set aside?
The subpoena to Joyce Dickson seeks every document held by the accountant pertaining to Instyle without any limitation as to time or subject matter (such as financial records relating to particular developments). It includes documents that have already been produced by Instyle during discovery. As part of the discovery process, the financial statements of Instyle and its bank records for at least the period 1 July 2016 to 4 August 2017 have been disclosed.
Counsel for Mr Hambrook submitted that Mr Hambrook should have had access to all financial records over the period when he was a director of Instyle, and that when he was a director, Mr Hambrook would have been able to review all documents held by the accountant pertaining to Instyle. Accordingly, those documents should be produced for review.
It was further submitted that as Mr McDonell referred to having reviewed business records of Instyle in his affidavit evidence, Mr Hambrook should have access to those records.
The Court’s attention was also drawn to the fact that the pleading had been amended. The amendment was to claim further amounts from Mr Hambrook and had apparently come about because of a discovery in 2019 of extra payments to Mr Hambrook, which Instyle asserts were further payments that were for the personal benefit of Mr Hambrook and not the benefit of Instyle, and accordingly paid in breach of Mr Hambrook’s statutory and/or fiduciary duties as a director.
Mr Hambrook says that this suggests that after proceedings were commenced, the plaintiff’s agents may have had discussions with the accountant, which changed how certain expenses were viewed or characterised. He is seeking to understand what happened to cause the amendment and believes that documents held by Joyce Dickson might shed light on how it was that the plaintiff came to amend its claim in that regard.
With regard to the oppression of a minority shareholder claim, Mr Hambrook is seeking essentially the complete financial record of Instyle to establish the network of transactions that took place between the various corporate entities referred to earlier in these reasons and the individuals controlling them. Mr Hambrook further contends that the more recent communications between the plaintiff and its accountant may be relevant to the relief sought. Counsel for Mr Hambrook gave an example of other decisions relating to transactions that could be relevant to Mr Hambrook’s argument about exclusion from payment constituting oppression, such as a note that says “pay company x but do not pay company y.”
In oral submissions, counsel for Mr Hambrook indicated that the defendant was prepared to limit the documents required from Joyce Dickson to exclude anything that had already been produced on discovery.
I accept that it is open to Mr Hambrook to seek records from the plaintiff’s accountant that might assist the defendant in his case, including testing what has been produced on discovery or referred to in affidavit evidence. However, the stated forensic purpose behind the subpoena does not persuade me that the entirety of the documents held by Joyce Dickson ‘pertaining to Instyle’ might assist Mr Hambrook in either proceeding.
The width of the terms of the schedule to the subpoena amounts to a generic request for every document – electronic or otherwise – referring to Instyle since the company was registered, and I am not satisfied that even the very low threshold for relevance has been established in respect of such a wide category. For example, the recording of time spent by an accountant preparing financial statements for Instyle is a document pertaining to Instyle, but it bears no relevance to the present proceedings. Similarly, communications with regulatory bodies such as the Australian Taxation Office or the Australian Securities and Investments Commission are caught by the terms of the schedule, but can have no bearing on the present disputes between the parties.
While there may be email communications or accounting records relevant to the payment or non-payment of commission, or the particular monies paid to Mr Hambrook that are disputed, none of the issues in either proceeding require the entirety of the documents held by the accountant since the company was registered. The payments in question, or lack thereof, including those referred to in the oppression suit, are few in number, and specific as to amount and time. I am not satisfied that the production of accounting records referring to other payments, at other times, over at least a six-year period, might assist Mr Hambrook in prosecuting or defending the two extant proceedings.
It was submitted that an order limiting the scope of the subpoena could be made, through the Court’s power to grant other relief. However, there was no clear alternative by way of a proposed amended schedule to the subpoena before the Court for consideration and I do not consider that r 6604 of the Rules either permits or requires the Court to traverse for itself the pleadings, affidavits and potential evidence so as to craft a form of words that captures only the documents that are relevant and otherwise unobjectionable on other grounds.
There is a further difficulty, in that the evidence before the Court suggests there are 553 documents potentially caught by the wide terms of the subpoena, and that those documents include what has been described as “internal and external documents”.
Thus, production is not as simple as copying the documents onto a USB stick, because the width of the terms of the schedule means that what is caught by the subpoena needs to be reviewed by an appropriately informed person, at the very least to confirm that there are no documents which are commercial in confidence (such as the accounting firm’s internal time records or drafts), or that might cause the subpoenaed party to seek particular orders upon production.
This has a costs consequence. Reviewing the documents in the accountant’s document management system is said to be a task that will take between 28 and 46 hours to complete and cost between $10,000 to $16,500 plus GST. The charge out rates were contained in the plaintiff’s affidavit evidence. The defendant contested whether the task of production would take that time, but neither Mr Hambrook nor the Court is in any better position to know whether the inspection of documents on an accountant’s document management system is something that will take one minute or two minutes per document. That cost is material when the Court is balancing the potential utility of the material sought against the burden which compliance with the subpoena will cast on the recipient. Even if adjectival relevance for the entire documentary record held by Joyce Dickson pertaining to Instyle (as opposed to a more limited production directly referable to the periods referred to in the pleadings) were to be established, the probative value appears to be so low that, when regard is had to the time and cost spent in gathering the documents, the disproportionality renders the subpoena oppressive.
Excluding the documents that have already been discovered may well reduce the number of documents the accountant is required to produce. However, Joyce Dickson is a non-party to the litigation. It has not been privy to the discovery process that has occurred between the parties. A subpoena issued to a non-party which makes reference to excluding previously discovered documents would be impermissible.
I further do not accept that the words of r 6604 create a substantive power for the Court to treat a subpoena issued to a non-party as if it were further discovery or a notice to produce issued to the plaintiff, even in the circumstances of this case, where the recipient of the subpoena is the plaintiff’s accountant. As stated above, the authorities are clear that strangers to the litigation should not be burdened with any requirement to consider the issues in the litigation or documents previously produced in the litigation. That is not the object of the subpoena process.
For these reasons, the subpoena as presently drafted must be set aside. There is nothing preventing the defendant from issuing a more targeted subpoena, or alternatively issuing a targeted notice to produce to the plaintiff dealing with communications between the plaintiff and Instyle’s accountant, or accounting documents expressly relating to the matters in dispute in these proceedings, but excluding documents already discovered.
Should the subpoenas to Realist8 and JMRE be set aside?
The subpoenas to these corporate entities suffer from similar difficulties, as again, the terms of each subpoena are so wide as to capture every financial transaction made by the companies through the bank records sought, and cover entities not even referred to in the pleadings in either proceedings.
The asserted forensic purpose of each of these subpoenas was that the corporate entities shared common directors and their business affairs were intertwined. An example was given of the salary of Mrs McDonell for work she did for Instyle being paid by a different company (namely, Realist8).
Because Realist8 and JMRE have common directors and shareholders with Instyle, Mr Hambrook seeks to establish his oppression claim in part by showing how commission has been paid in respect of similar contractual arrangements with those companies. It was said to be relevant to ‘follow the money trail’ in order to show to the Court what was really going on and how Mr Hambrook was being excluded or treated in a discriminatory way.
Counsel for Instyle says this amounts to a broad sweeping submission that because Mr and Mrs McDonell run other companies, and have shareholdings in other companies, they should lay the accounts of those companies bare. A number of the companies from whom documents are sought are not referred to at all in any of the pleadings. The subpoena schedule does not tie the documents sought to any period of time or any particular developments.
I accept that submission. Each of the two subpoena schedules are drafted in terms so wide as to constitute impermissible fishing. The lack of specificity in the schedules results in an obligation to produce documents entirely unrelated to the proceedings.
There is nothing apparent from the pleadings and the substantial affidavit evidence led on the application to explain how companies such as Realist8, Tiger Property Group Pty Ltd or Project Property Group ACT Pty Ltd played any role in the residential developments giving rise to the present disputes about commission, or improper payments to Mr Hambrook or the failure to pay termination entitlements under his employment contract.
Following the money may well assist Mr Hambrook’s case, but I cannot see anything in the evidence to explain why invoices that Realist8 and JMRE sent to Tiger Property Group are even adjectively relevant to the present dispute, in the sense of possibly throwing light on the issues in the main case.
If it is ‘on the cards’ that commission in respect of the three developments in question in the proceedings was in fact paid to other related companies (with similar contractual arrangements), and Mr Hambrook views this as potentially relevant to arguments in his oppression of the minority claim, I would be reluctant to prevent him obtaining the documents that he needs to even make the argument in the first place (whatever its ultimate merit). However, the subpoena schedule should, at the very least, tie the invoices and bank account statements sought under subpoena to those potential issues – even by reference to a particular contract or development.
I have given consideration to whether it was appropriate to set aside the subpoena in part, and limit the scope of the subpoena to production of invoices to Lifestyle Homes and 3 Property Group, and the bank account statements evidencing the payment of those invoices. Again however, the evidence did not establish how any unspecified invoices issued by Realist8 and JMRE to those companies were apparently relevant to the issues at trial. The fact that at one time Realist8 had paid the wages of Mrs McDonell when she performed work for Instyle is insufficient evidence of itself to bring the subpoena within apparent relevance to the issues in the proceedings.
Accordingly, the subpoenas as currently drafted must be set aside. Again, there is nothing preventing Mr Hambrook from issuing a further subpoena (with leave, on short service) to either Realist8 or JMRE in a more targeted manner, such as seeking the production of invoices and accounts referrable to specified periods of time or developments. Mr Hambrook is not prevented from calling for any particular documents, including invoices issued to the companies named in the schedules, if the affidavit evidence or cross-examination reveals them to be relevant to the case. They will of course be matters for the trial judge.
Conclusion
These findings are sufficient to dispose of the application. In my view, costs of the application should follow the event but there may have been correspondence that is relevant to that issue. Accordingly, I have reserved costs and the parties can either apply for a separate costs order in chambers or deal with the issue as part of the resolution of the substantive proceedings. The Orders of the Court were as follows:
(1)The subpoenas issued to MGI JOYCE!DICKSON Pty Ltd (ACN 615 645 200), Realist8 Agent Services Pty Ltd (ACN 606 662 408), and Jamie McDonell Real Estate Pty Ltd (ACN 154 243 955) are set aside.
(2)Costs of the application are reserved.
| I certify that the preceding sixty [60] numbered paragraphs are a true copy of the Reasons for Judgment of her Honour Associate Justice McWilliam Associate: Date: |
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Amendment
29 January 2021 Insert (No. 2) at the end of the case title.
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