Iphostrou and Iphostrou and Ors (No 4)

The Family Court of Australia, in the matter of *Iphostrou and Iphostrou and Ors (No. 4)*, considered an interlocutory application by the wife for litigation funding orders. The dispute involved the husband and wife, their children, and various entities and shareholders, with complex financial proceedings at its core. The wife sought to rely on affidavits from her forensic accountant and solicitor, but the husband objected to certain evidence within these affidavits on the grounds that the underlying information had been illegally obtained.

The central legal issue before the court was whether the evidence, obtained improperly by the wife, should be admitted notwithstanding its illegality, pursuant to section 138 of the *Evidence Act 1995* (Cth). This required the court to determine if the desirability of admitting the evidence outweighed the undesirability of admitting evidence obtained in such a manner. The court was directed to consider factors including the probative value of the evidence, its importance in the proceedings, the nature of the case, the gravity of the impropriety, whether it was deliberate or reckless, and the difficulty of obtaining the evidence lawfully.

Justice Cronin reasoned that while the wife conceded the evidence was improperly obtained, placing the onus on her to justify its admission, the circumstances warranted its inclusion. The court noted the significant volume of documents obtained and inferred a targeted operation, acknowledging that a parent encouraging a child to obtain such information could be a factor against admission. However, the court found that the potential for the same documents to be obtained through proper discovery, given the joinder of relevant entities, mitigated concerns about the public interest in discouraging vigilante methods. The court also considered the conflicting evidence regarding the ownership of the business and the documents, the potential for the evidence to reveal a conspiracy or a legitimate explanation, and the difficulty in assessing its probative value at an interlocutory stage. Ultimately, the court concluded that the desirability of admitting the evidence, particularly its importance in potentially uncovering the true financial position and the difficulty in obtaining it otherwise, outweighed the undesirability of its improper acquisition.

The court ordered that the affidavits of Mr. K and Mr. G be admitted into evidence for the purposes of the interlocutory hearing. Publication of the judgment under a pseudonym was approved pursuant to section 121(9)(g) of the *Family Law Act 1975* (Cth).