Jess & Jess (No 14)
[2024] FedCFamC1F 391
•7 June 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Jess & Jess (No 14) [2024] FedCFamC1F 391
File number MLF 3444 of 2006 Judgment of WILSON J Date of judgment 7 June 2024 Catchwords FAMILY LAW – MAJOR COMPLEX FINANCIAL PROCEEDINGS LIST – PRACTICE AND PROCEDURE – discovery – documents sought by represented third parties from the wife – overly broad and oppressive – represented third parties’ entitlement to disclosure grounded in rule 6.06(2) – prerequisites not established. Legislation Corporations Act 2001 s 9
Family Law Act 1975 s 79, 79A, 106B
Cases cited Jess & Jess (No 11) [2023] FedCFamC1F 1027
Jess & Jess (No 12) [2024] FedCFamC1F 58
Jess & Jess (No 3) [2022] FedCFamC1F 408
Jess & Jess (No 3) [2023] FedCFamC1A 2
Jess & Jess (No 4) [2023] FedCFamC1A 189
Jess & Jess (No 5) [2024] FedCFamC1A 85
Jess & Jess (No 7) [2023] FedCFamC1F 291
Stanford v Stanford (2012) 247 CLR 108
Division Division 1 First Instance Number of paragraphs 72 Date of hearing 1 and 31 May 2024 Place Melbourne Counsel for the applicant Mr G Dickson KC Solicitors for the applicant Kenna Teasedale Lawyers Counsel for the represented third parties Mr A Myers AC KC with Mr C Lum and Mr J Mereine Solicitors for the represented third parties HWL Ebsworth Lawyers Counsel for the intervener Ms N Papaleo Solicitors for the intervener Lander & Rogers ORDERS
MLF 3444 of 2006 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN MS JESS
Applicant
AND MR J AS LEGAL REPRESENTATIVE FOR MR JESS SNR (DECEASED)
First Respondent
MR JESS JNR & ORS (THE REPRESENTED THIRD PARTIES)
Second to 29th Respondents
MR K & MR L AS TRUSTEES OF THE BANKRUPT ESTATE OF MR JESS SNR
Interveners
ORDER MADE BY
WILSON J
DATE OF ORDER
7 JUNE 2024
THE COURT ORDERS THAT –
1.I dismiss all applications in paragraph one of the represented third parties’ application in a proceeding dated 13 March 2024 insofar as it related to Schedule B.
2.By 4pm on 27 June 2024, the represented third parties must complete the task of providing to the wife’s solicitors all discovery ordered by me by my orders made in this proceeding on 8 December 2023.
3.The further hearing of this proceeding is adjourned to 10am on 28 June 2024 before me.
4.Any application for costs to be made arising out of these orders must be brought supported by all applicable affidavits and submissions by noon on 24 June 2024 which I will consider on the papers thereafter.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
WILSON J
These reasons address two applications relating to discovery.
The first concerns discovery ordered by me on 8 December 2023.[1]
[1] Jess & Jess (No 11) [2023] FedCFamC1F 1027.
The second is the discovery application brought by the represented third parties in their application in a proceeding dated 13 March 2024.
COMPLIANCE WITH THE 8 DECEMBER 2023 ORDERS
The represented third parties’ application for leave to appeal against my orders made on 8 December 2023 was refused[2] as was their application for leave to appeal against my refusal to grant a stay.[3]
[2] Jess & Jess (No 5) [2024] FedCFamC1A 85.
[3] Jess & Jess (No 12) [2024] FedCFamC1F 58.
In Jess & Jess (No 11) I made a comprehensive array of orders in respect of disclosure. Despite those orders having been pronounced almost six months ago, the represented third parties have yet to complete the task of providing to the wife all documents and categories of documents I ordered them to produce. On 31 May 2024 I ordered the represented third parties to complete the task of providing documents recorded in the 8 December 2023 orders by 28 June 2024 when this proceeding will be next heard by me.
On behalf of the represented third parties Mr Myers AC KC submitted that the represented third parties have no intention of delaying this litigation and that they have produced three substantial tranches of documents to the wife’s solicitors in recent days. It is my requirement that the task of completing disclosure in accordance with the 8 December 2023 orders is achieved by 4pm on 27 June 2024.
THE REPRESENTED THIRD PARTIES’ DISCLOSURE SOUGHT FROM THE WIFE
By application in a proceeding dated 13 March 2024 the represented third parties sought from the wife orders for disclosure of documents requested in Schedule A as well as in Schedule B insofar as those documents are or have been in the possession or control of the wife. The represented third parties sought costs and such other orders as the court considered appropriate. The affidavit in support of the represented third parties’ application was made by their solicitor dated 13 March 2024. Relevantly synthesised, Mr ZZ deposed to the following issues of importance on this application –
(a)on 4 August 2022 I made orders requiring any party by 4pm on 2 December 2022 to serve on any other party a list of documents or categories of documents that he she or it required that party to produce by way of discovery;
(b)on 4 August 2022 I made orders requiring any party served (in accordance with the order paraphrased in the immediately preceding subparagraph) to produce by 4pm on 23 December 2022 the documents requested insofar as those documents were or had been in that party’s possession or control and which were not subject to objection;
(c)the dates 2 December 2022 and 23 December 2022 recorded in the two alphabetical subparagraphs set out immediately above were varied to 12 December 2022 and 20 December 2022 respectively, the latter date being brought forward;
(d)on 12 December 2022 the represented third parties’ solicitors served on the wife’s solicitors a list of documents or categories of documents the wife was required to discover;
(e)on 19 December 2022 the wife’s solicitors wrote to the represented third parties’ solicitors stating, in substance, that the disclosure sought by the represented third parties related to issues arising under s 79A of the Family Law Act, that those issues were dealt with in my reasons of 29 July 2022, which judgment was then on appeal and the result was pending rendering the documents irrelevant to the s 79 proceeding[4] before the court;
[4] As distinct from the s 79A application.
(f)on 20 December 2022 the represented third parties’ solicitors wrote to the wife’s solicitors disputing the assertion of irrelevance insisting instead that the documents sought were relevant to paragraph 27 of the wife’s amended statement of claim and to paragraphs 18(c), 22, 23, 26 and 27 of the represented third parties’ defence therefore requiring production;
(g)on 19 January 2023 the represented third parties’ solicitors wrote to the wife’s solicitors observing that the reasons of the Full Court[5] made it plain that the documents sought in the represented third parties’ list were relevant to facts in issue in the pleadings and the represented third parties required the wife to produce the documents requested of her by 4pm on 10 February 2023 in default of which orders would be sought;
(h)the represented third parties then filed an application in a proceeding dated 2 March 2023 returnable on 23 March 2023 in which the represented third parties sought orders for the wife to produce by way of disclosure the documents requested in the list dated 12 December 2022;[6]
(i)on 2 March 2023 the represented third parties’ solicitor made an affidavit in support of his clients’ application in a proceeding dated 2 March 2023;
(j)the wife relied on her response to an application in a proceeding, her response being dated 20 March 2023 in which the wife sought orders requiring –
(i)the represented third parties to produce documents in accordance with the wife’s own document entitled “Schedule A to this response”;
(ii)the second respondent be required to file and serve an affidavit addressing the matters in paragraph two of the response;
(iii)within seven days the wife was to provide to the represented third parties financial disclosure[7] requested in their list of documents dated 12 December 2022; and
(iv)costs.
[5] Jess & Jess (No 3) [2023] FedCFamC1A 2 (10 January 2023) Alstergren CJ, Aldridge and Austin JJ).
[6] The represented third parties rather ambitiously incorporated in their application in a proceeding a prayer for the wife to pay their costs.
[7] The words “financial disclosure” is a term defined in the Federal Circuit and Family Court of Australia (Family Law) Rules 2021.
The wife’s solicitor, Mr Gregory made an affidavit on 20 March 2023. While he did not say as much in his affidavit, Mr Gregory made that affidavit in support of the wife’s response dated 20 March 2023. In that affidavit Mr Gregory deposed to the more important matters as follows –
(a)he addressed his correspondence with Mr ZZ on 12 and 19 December 2022;
(b)on 21 December 2022 Mr Gregory deposed to receiving the represented third parties’ documents[8] in response to category four of the wife’s requested disclosure;
[8] Mr ZZ did not depose to sending this tranche of documents.
(c)on 10 February 2023 Mr Gregory deposed to receiving the represented third parties’ documents[9] in response to category one of the wife’s list;
[9] Similarly, Mr ZZ did not depose to his clients’ provision of this disclosure.
(d)on 21 February 2023 Mr Gregory wrote to the solicitors for the represented third parties requesting all documents listed to be provided electronically;
(e)Mr Gregory wrote to the solicitors for the represented third parties on 21 February 2023 answering the 19 December 2022 correspondence from the represented third parties, pointing out –
(i)the basis for objecting to production of documents after 20 September 2009 was not explained;
(ii)the wife pressed her application for disclosure of the third parties’ documentation that concerned whether Mr Jess Jnr retains the legal or beneficial ownership of the husband’s shareholding, documentation that concerned whether Mr Jess Jnr had transferred any of the husband’s unitholding to the husband and if so on what terms, and, if Mr Jess Jnr transferred those units, to whom;
(iii)the wife sought disclosure of those matters and pointed out that no basis existed to confine disclosure to a period prior to 20 September 2009;
(f)on 28 February 2023 the solicitors for the represented third parties provided in electronic form the documents in their 10 February 2023 index;
(g)the represented third parties were in breach of the orders made in October in that they have not provided documentation in accordance with the list filed 12 December 2023;
(h)the wife’s response contains her request for documents in Schedule A and her request for the second respondent to make, file and serve an affidavit disclosing certain issues; and
(i)Mr Gregory deposed to the represented third parties’ application for the wife to make better disclosure, reciting already narrated correspondence dated 19 December and 20 December 2022 as well as the correspondence dated 19 January 2023.
Mr ZZ deposed to the appearance before me on 23 March 2023. On that hearing, Mr Dickson KC as senior counsel for the wife announced in a manner recorded on transcript that the documents sought of the wife would be provided exhaustively within seven days of 23 March 2023, precipitating Mr Waller KC, then senior counsel for the represented third parties, stating on transcript that no formal order was sought.
My decision in Jess & Jess (No 7)[10] was handed down on 27 April 2023 requiring disclosure to be given in respect of events subsequent to the year 2009.
[10] [2023] FedCFamC1F 291.
In his 13 March 2024 affidavit, Mr ZZ referred to the decision of the Full Court handed down on 3 November 2023[11] refusing the represented third parties’ applications for leave to appeal in respect of my orders made on 27 April 2023. Mr ZZ stated that the decision of the Full Court[12] revealed that the trial of this proceeding would concern matters beyond 24 September 2009 “notwithstanding the Deed of Settlement”. Mr ZZ’s supererogation in parenthesis seemed unnecessary because the Full Court had decided the point.
[11] Jess & Jess (No 4) [2023] FedCFamC1A 189.
[12] Ibid.
On 27 December 2023 the represented third parties’ solicitors wrote to the wife’s solicitors with a list of contentions that were said to support their argument that the wife had failed to comply with her disclosure obligations. With that letter was schedule 1 setting out documents that the represented third parties said remained undisclosed by the wife. The 27 December 2023 letter from the represented third parties also included schedule 2 setting out categories of documents the represented third parties required the wife to disclose arising from pleadings relating to events subsequent to 24 September 2009.
The wife’s solicitors responded to the represented third parties’ 27 December 2023 letter by her solicitors’ letter dated 1 February 2024 stating that they expected to reply by 7 February 2024. On 12 February 2024 the wife’s solicitors wrote to the solicitors for the represented third parties stating, among other things, that certain documents could be provided whereas others could not by reason of the merger of CQ Company with U Consultants.
Mr ZZ deposed to the wife’s solicitors not providing certain documents set out in Schedule 1 and Schedule 2 to the 27 December 2023 letter. Mr ZZ deposed to the wife not disclosing to the represented third parties –
(a)the documents in schedule 1 to the 27 December 2023 letter;
(b)any documents in schedule 2 to the 27 December 2023 letter;
(c)any documents responding to the December 2022 list in items 2, 3, 8, 9, 19, 20, 21, 22, 23, 24, 25 and 26; and
(d)all categories of 28 documents to the December 2022 list.
THE WIFE’S SUBMISSIONS ON THE REPRESENTED THIRD PARTIES DISCOVERY APPLICATION
The wife’s solicitors filed and served written submissions dated 15 May 2024 in response to the represented third parties’ application for documents in Schedule A and Schedule B to their 13 March 2024 application in a proceeding “insofar as those documents are or have been in the possession or control of the applicant wife”.
The date 31 May 2024 was fixed for the hearing of the viva voce debate.
SCHEDULE A DOCUMENTS
On behalf of the wife it was said that the documents sought by the represented third parties in Schedule A of their application covering 32 different categories over the period December 2006 to September 2009 had been provided by the wife on 4 April 2009 and on 29 April 2024. It was also said that the wife provided over 8000 pages of documents between 2023 and 2024 and that she also provided documents sought in Schedule A in accordance with orders made by Altobelli J on 7 June 2022.[13]
[13] Jess & Jess (No 3) [2022] FedCFamC1F 408.
SCHEDULE B DOCUMENTS
The documents in Schedule B were separated into four categories, according to the letter from the represented third parties’ solicitors to the wife’s solicitors dated 9 May 2024. Those categories were documents in –
(a)first, categories 2, 3 and 4;
(b)second, category 5;
(c)third, categories 6 to 11; and
(d)fourth, category 12.
To more comprehensively understand the documents sought by the represented third parties in respect of any of the disputed categories in Schedule B of their application, it is necessary to first record the precise terms of the documents sought.
PARAGRAPHS 2, 3 AND 4 OF THE SCHEDULE B
The first category of documents sought were those in paragraphs two, three and four of Schedule B to the represented third parties’ application in a proceeding dated 13 March 2024. Those paragraphs provided that the represented third parties sought –
2. All documents which record or refer to any conversation in the period from 24 September 2009 to […] 2018 (inclusive) between [Ms Jess] and [Mr Jess Snr] relation to, or in connection with, the Family Court Proceeding, Supreme Court Proceeding, Deed of Settlement, Transfer, [Jess Retail Unit Trust], [Y Business] franchise […], [X Corporation Pty Ltd], [Mr Jess Jnr], any entity listed in Annexure C to the Deed of Settlement and/or any of the [AM Real Estate] Properties.
3.All Documents sent by [Ms Jess] to [Mr Jess Snr], or received by [Ms Jess] from [Mr Jess Snr], in the period from 24 September 2009 to […] 2018 (inclusive) in relation to, or in connection with, the Family Court Proceeding, Supreme Court Proceeding, Deed of Settlement, Transfer, [Jess Retail Unit Trust], [Y Business] franchise […], [X Corporation Pty Ltd], [Mr Jess Jnr], any entity listed in Annexure C to the Deed of Settlement and/or any of the [AM Real Estate] Properties.
4. All Documents sent by [Ms Jess] to [Mr J], or received by [Ms Jess] from [Mr J], in the period from 24 September 2009 to date (inclusive) in relation to, or in connection with, the Family Court Proceeding, Supreme Court Proceeding, Deed of Settlement, Transfer, [Jess Retail Unit Trust], [Y Business] franchise […], [X Corporation Pty Ltd], [Mr Jess Jnr], any entity listed in Annexure C to the Deed of Settlement and/or any of the [AM Real Estate] Properties.
By way of general observation, the wife’s legal representative submitted that the represented third parties’ request for all documents set out in Schedule B was oppressive. The wife contended that the terms used in the Schedule B request were so broad as to be near meaningless and that “virtually any document requested by the represented third parties is required”. The wife’s legal representatives also made a broad contention that discovery is required to relate to an issue in dispute and that the relevance of the documents set out in Schedule B had not been demonstrated.
Before addressing the competing contentions in respect of each category of document, it is necessary to scrutinise the precise wording of each paragraph in Schedule B. Taking paragraph two first, in that paragraph the represented third parties sought production by the wife of –
·all documents;
·over the period 24 September 2009 to 2018 inclusive;
·that recorded or referred to any conversation over that period;
·between Ms Jess and Mr Jess Snr;
·in relation to or in connection with the defined terms –
*the Family Court proceeding; or
*the Supreme Court proceeding; or
*the deed of settlement; or
*the deed of transfer; or
*the Jess Retail Unit Trust; or
*the Y Business franchise; or
*X Corporation Pty Ltd; or
*Mr Jess Jnr; or
*any entity listed in Annexure C to the deed of settlement; or
*any of the AM Real Estate properties.
Understood in that context, the represented third parties’ request for documentation in paragraph two of Schedule B to their 13 March 2024 application in a proceeding required the wife to examine the totality of documents in her possession, power or control and then to undertake the task of assessing whether one or more of those documents corresponded with a collection of enquiries. Those enquiries included whether that or those documents –
(a)was dated in a period fixed by reference to 24 September 2009 to 2018;
(b)recorded or referred to any conversation over that period between two named persons; and
(c)related to or was connected with any of the issues against which stars have been affixed above.
In their written submissions in reply dated 31 May 2024, the represented third parties challenged the wife’s contentions that the documents sought in paragraph two (as well as in paragraphs three and four) were irrelevant. The represented third parties submitted that they are entitled to see what the wife says after 20 September 2009 with a view to testing whether her asserted state of mind when she entered into the deed of settlement was in fact true. They also apply for the documents in paragraph two, three and four to test the assertion in paragraph 30 of the amended statement of claim, having regard to the findings of Bennett J that the wife and husband were in the same camp.
In my view, the breadth of the request in paragraph two is burdensome and oppressive.
The point may be tested by example. Let it be assumed that a document did in fact exist, written (hypothetically) by Mr Jess Snr on 1 October 2011 and it purported to record no more than the words “[Mr Jess Jnr]”. Such a document was sought by the represented third parties. Such a document had no forensic purpose in this litigation yet the task of unearthing it, setting it to one side and identifying it as a document responsive to paragraph two of Schedule B was disproportionately oppressive to any forensic advantage acquired from the document. In the same way that compound questions asked in cross-examination invite objection on the basis of inadmissibility, a request for production of documents enquiring after multiple possible issues set out in paragraphs two, three and four likewise invites objection.
In my view, on its face paragraph two of Schedule B is defective and need not be answered.
To my mind, it is not to the point for the represented third parties to contend that a specific request for documents is somehow anchored to a pleaded assertion. It goes without saying that for discovery to be regularly invoked in the first place, a pleaded assertion must anchor the request for disclosure. Here, the issue is the breadth of the disclosure sought. The request for documents made in paragraph two of Schedule B is unsatisfactorily wide.
The documents sought in paragraph three of Schedule B were similarly broad. The represented third parties sought production by the wife of –
·all documents;
·over the period from 24 September 2009 to 2018 inclusive;
·sent by Ms Jess to Mr Jess Snr or received by Ms Jess from Mr Jess Snr;
·in relation to or in connection with the defined terms –
*the Family Court proceeding; or
*the Supreme Court proceeding; or
*the deed of settlement; or
*the transfer; or
*the Jess Retail Unit Trust; or
*the Y Business franchise; or
*X Corporation Pty Ltd; or
*Mr Jess Jnr; or
*any entity listed in Annexure C to the deed of settlement; or
*any of the AM Real Estate properties.
As with the documents sought in paragraph two of Schedule B, in responding to the request in paragraph three of the represented third parties’ Schedule B, the wife was required to examine the totality of the documents in her possession, power or control and then to undertake an assessment of whether one or more of those documents corresponded with a collection of enquiries. Those enquiries included whether that or those documents –
(a)was or were dated in a period fixed by reference to 24 September 2009 and 2018;
(b)was or were sent or received by Ms Jess or Mr Jess Snr; and
(c)related to or was connected with any of the issues against which stars have been affixed in the immediately preceding paragraph.
As with the documents sought in paragraph two of Schedule B, in my view the documents sought in paragraph three of Schedule B are similarly impermissibly broad rendering the request burdensome and oppressive.
Another illustration, different from the example posed in reference to paragraph two of Schedule B, will serve to make good the proposition. Let it be assumed that on 1 October 2009 Ms Jess sent an email to Mr Jess Snr transmitting, without text commentary or more, the 30 June 2008 accounts for X Corporation Pty Ltd. Such a document would answer the description of documents requested by paragraph three of Schedule B yet the pleaded issue in respect of which such production was sought was near impossible to tell. How the sending of such a seemingly innocuous email might forensically go to Ms Jess’s state of mind was near impossible to say.
I take the view that paragraph three of the represented third parties’ Schedule B is too wide and production of documents sought in pursuance of that paragraph is oppressive with the consequence that paragraph three need not be answered.
In paragraph four of Schedule B, the represented third parties sought production from the wife of all documents sent by her to Mr J or all documents received by her from Mr J in the period 24 September 2009 to date (inclusive) concerning the same matters against which stars appear above in relation to paragraphs two and three of Schedule B.
The construction of paragraph four closely corresponded to the construction of paragraphs two and three of Schedule B. In paragraph four, the represented third parties sought production by the wife of –
·all documents;
·over the period 24 September 2009 to date;
·sent by Ms Jess to Mr J or received by Ms Jess from Mr J;
·in relation to or in connection with the defined terms –
*the Family Court proceeding; or
*the Supreme Court proceeding; or
*the deed of settlement; or
*the deed of transfer; or
*the Jess Retail Unit Trust; or
*the Y Business franchise; or
*X Corporation Pty Ltd; or
*Mr Jess Jnr; or
*any entity listed in annexure C to the deed of settlement; or
*any of the AM Real Estate properties.
As with the requests for documents in paragraphs two and three of Schedule B made by the represented third parties, in paragraph four the represented third parties tied their documentary requests to the same categories of documents as were starred above in reference to the documents sought in pursuance of paragraphs two and three. But unlike paragraphs two and three, in paragraph four of Schedule B the represented third parties’ request for documents involving Mr J was unrestricted as to date (“24 September 2009 to date (inclusive)”), the latter date being the date when the wife answered the request.
Expressed slightly differently, under paragraph four of Schedule B, the represented third parties sought production from the wife in respect of each of the starred categories of documents under the broad rubric of –
(a)the period 24 September 2009 to date; and
(b)all documents sent by the wife to Mr J or received by the wife from Mr J.
In other words, a 15 year period was in issue, a sender and recipient was identified and the subject matter was 10 categories of documents.
To my mind, that request was oppressive. I am unable to see how such a request was validly underpinned by a pleading that addressed a state of mind.
It must not be overlooked that paragraph 27 of the wife’s amended statement of claim put in issue the matters known by the wife as at 20 September 2009. Precisely how documents exchanged between the wife and Mr J from September 2009 to 2024 addressed that point went unexplained.
I take the view that the documents sought in paragraphs 2, 3 and 4 of Schedule B need not be supplied as the request for their production is bad for being oppressive.
PARAGRAPH FIVE OF SCHEDULE B
As a stand-alone category of documents, paragraph five of Schedule B was the subject of a separate request by the represented third parties. The wife objected to producing documents in response to the request in paragraph five by reason of irrelevance. The represented third parties pressed for the production of documents set out in paragraph five. It was in the following terms –
5.All Documents, including Books, that were in the possession of [Mr Jess Snr] in the period from 24 September 2009 to […] 2018 which record any Financial Information.
That deceptively simply paragraph carried with it certain defined terms, including “Books, “Documents” and “Financial Information”. The word “Books” was defined to mean the following –
“Books” has the meaning given to it in section 9 of the Corporations Act 2001 (Cth).
The word “documents” was also defined. The definition was as follows –
“Document(s)” means any record of information and includes, without limitation, (in soft or hard copy) letters, emails, facsimiles, text messages, written messages communicated using Skype, WhatsApp, Messenger, WeChat, Viber or Twitter, messages posted in Facebook, notes, file notes, diary notes, memoranda, working papers, any notes recording conversations, loan agreements (in draft and final form), letters offering financial accommodation and deeds (in draft and final form), funding agreements (in draft and final form), financial records, financial statements or financial reports and expert reports (in draft and final form).
The phrase “Financial Information” was also defined. It was as follows –
“Financial Information” means any record of financial information, including, without limitation, (in soft or hard copy) Books, of:
1.the [Jess Retail Unit Trust]; and/or
2.[X Corporation Pty Ltd]; and/or
3.the [Y Business] franchise […]; and/or
4.the “[X Group] of Companies” (as defined in paragraph 9 of [Ms Jess’s] affidavit sworn on 30 March 2022).
In paragraph five of Schedule B the represented third parties sought production of “all documents” (as defined), “including Books” (as defined) that were in the possession of Mr Jess Snr between 24 September 2009 to 2018 which record “any Financial Information” (as defined). The definition of “Financial Information” includes “any record of financial information in soft or hard copy, including that relating to the [X Group] of Companies”.
The represented third parties in their reply submissions dated 31 May 2024 disputed the wife’s contentions about irrelevance. They argued that the documents sought go to matters germane to s 79 and s 106B of the Family Law Act.
Paragraph five contains a request for documents that in my view is onerous for being unacceptably wide. Precisely how the production of that documentation bears upon an issue in this proceeding is very difficult to see. At all events, the represented third parties do not say how they are entitled to seek production of documents that were in Mr Jess Snr’s possession. They have sought documents in the wife’s possession, power or control, yet by paragraph five of Schedule B they do not seek such documents.
In my view, the represented third parties are not entitled to seek production of the documents in paragraph five of Schedule B. That request in unacceptably wide.
PARAGRAPHS SIX TO 11 OF SCHEDULE B
As a separate category of documents sought by the represented third parties, they called for the wife to produce documents that answered the requests in paragraphs six to 11 of Schedule B. It is necessary to set out those paragraphs.
6.All Documents, including Books, in the period from 24 September 2009 to date which evidence or record:
(a) any advice in relation to the investment of money received by [Ms Jess] pursuant to the Deed of Settlement;
(b) the investment of money that [Ms Jess] received pursuant to the Deed of Settlement;
(c) the purchase of property by [Ms Jess] and/or [PPP Investments Pty Ltd];
(d) the disposal of property (whether by sale, transfer, assignment or gift), including jewellery and/or motor vehicles, by [Ms Jess] and/or [PPP Investments Pty Ltd]; and/or
(e) the proceeds of any disposal of property by [Ms Jess] and/or [PPP Investments Pty Ltd].
7. All Documents, including any Books, in the period from 24 September 2009 to date which evidence or record the:
(a) negotiation of funding for [Ms Jess] and/or [PPP Investments Pty Ltd] in relation to the Family Court Proceeding;
(b) provision of funding to, or for the benefit of, [Ms Jess] and/or [PPP Investments Pty Ltd] in relation to the Family Court Proceeding; and/or
(c) terms of any funding provided to, or for the benefit of, [Ms Jess] and/or [PPP Investments Pty Ltd] in relation to the Family Court Proceeding, including any funding agreement executed by [Ms Jess] and/or [PPP Investments Pty Ltd] and/or security provided by [Ms Jess] and/or [PPP Investments Pty Ltd].
8. All Documents which record any contribution, as contemplated by sections 79(4)(a) and (b) of the Family Law Act 1975 (Cth), made by [Ms Jess].
9. All Documents, including any Books, which evidence or record any:
(a) asset, including any vested or contingent interest in property;
(b) earnings, including income;
(c) financial resource;
(d) beneficial interest in any trust;
(e) loan; and/or
(f) other financial obligation, contingent or otherwise, of [Ms Jess] and/or [PPP Investments Pty Ltd] in the period from 24 September 2009 to date.
10. All Documents, including any Books, in the period from 24 September 2009 to date which evidence or record any:
(a) vested or contingent interest in property owned by a legal entity that is fully or partially owned or controlled by [Ms Jess] and/or [PPP Investments Pty Ltd];
(b) income earned by a legal entity fully or partially owned or controlled by [Ms Jess] and/or [PPP Investments Pty Ltd];
(c) trust of which [Ms Jess] and/or [PPP Investments Pty Ltd] is the appointor or trustee;
(d) trust over which [Ms Jess] and/or [PPP Investments Pty Ltd] has any direct or indirect power or control;
(e) trust of which [Ms Jess] and/or [PPP Investments Pty Ltd] has the power to amend the terms;
(f) trust of which [Ms Jess], a child of [Ms Jess] or a de facto spouse of [Ms Jess] is an eligible beneficiary; and/or
(g) trust of which a corporation is an eligible beneficiary if [Ms Jess], a child of [Ms Jess] or a de facto spouse of [Ms Jess] is a shareholder or director of the corporation.
11. All Documents, including any Books, in the period from 24 September 2009 to date which evidence or record any disposal of property (whether by sale, transfer, assignment or gift) by a legal entity, corporation and/or trust referred to in paragraphs 9(d) and/or 10 above.
In her written submissions, the wife contended that a degree of repetition existed over paragraphs six to 11. Be that as it may, it was necessary to record the requests in each paragraph.
At the outset it must be recalled that under Stanford v Stanford[14] the identification of the parties’ existing legal and equitable interests is critical. How the parties attained those existing legal and equitable interests may be relevant to contributions. Accordingly, it will be irrelevant for the court to enquire or to know how one party’s sophisticated wealth creation advice caused that party to have assets of a certain value at the date of trial. For that reason, in the ordinary course of events at trial valuation evidence is ordinarily adduced in relation to a parcel of real estate giving the value of that land as at the date of trial, rendering irrelevant information about why a party purchased that land. According to Stanford v Stanford, the enquiry is directed to the existing legal and equitable interests of the parties in property. How the parties came to the point in time relevant to those existing legal and equitable interests in property may be relevant to contributions. Yet in paragraph six of the represented third parties’ request for documents from the wife in Schedule B, they ask for production of documents going to antecedent issues. The wife’s complaint about paragraph six of the represented third parties’ request for documents did not focus on the breadth of the categories of documents sought nor did it focus on dates relevant to the request. Instead, paragraph six was directed to documentation pertaining to the wife’s acquisition and disposition of property.
[14] (2012) 247 CLR 108.
The request for documents in paragraph 6(a) involved production of any advice in relation to the investment of property by the wife pursuant to the deed of settlement. The advice she received was a matter for her. How the wife applied funds she received was also a matter for her. The represented third parties did not plead a cause of action that otherwise made investment advice received by the wife relevant to a fact in issue in this litigation,
That addressed paragraph 6(a).
The same observations applied to paragraphs 6(b) to (e) of Schedule B.
In their reply submissions dated 31 May 2024 the represented third parties advanced five reasons why they said the documents sought in paragraphs six to 11 of Schedule B should be produced in accordance with their application. First, they submitted that the qualification to rule 6.06(3) in rule 6.06(2) of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 does not apply to the wife. Second, they submitted that it has been held that they have an interest in the orders ultimately made as between the wife, the executors and the trustees. Third, they argued that the s 79 and s 106B applications are being heard at the same time, there having been no bifurcation and to that end they argued that the documents sought are relevant to the court’s decision of whether to exercise its discretion. They contended that the production of the documents sought goes to informing the court of the size and composition of the matrimonial pool. They said it may turn out that an order at the end of the trial of this proceeding may be made to the effect that the wife has already received a just and equitable division of matrimonial assets and that no need exists to disturb any assets. To that end, the represented third parties argued that the documents sought in paragraphs six to 11 will enable the court to ascertain the size of the pool, a factor sometimes important in the context of s 106B. Fourth, they argued that Mr Jess Jnr has standing as a party and is entitled under s 79 to obtain disclosure of the documents he and the other represented third parties seek. Fifth, they argued that s 79 (10) contemplates persons other than spouses being parties to litigation such as this.
In my view the wife was correct in asserting irrelevance in relation to the documents sought in paragraph six. The resolution of the debate about rule 6.06(2) is addressed below.
In paragraph seven of Schedule B the represented third parties pursued production of documentation from the wife in relation to her litigation funding for this proceeding. Precisely how that request was said to relate to the ascertainment of legal and equitable interests of parties went unexplained. The represented third parties did not contend that the wife had somehow wasted funds by entering into arrangements with a third party to meet her legal expenses.
To my mind, the request for documentation in paragraph seven of the represented third parties’ Schedule B was misconceived. The wife was at liberty to refuse to produce documents in compliance with it.
In paragraph eight of Schedule B the represented third parties sought all documents which recorded any contribution made by the wife in accordance with s 79(4)(a) and (b) of the Family Law Act. The wife is undoubtedly required to make discovery of contributions. However, the represented third parties are not entitled to ask for that discovery from the wife.
Paragraph nine contains the represented third parties’ request for the wife to produce all documents which record assets, earnings, financial resources, beneficial interests in trusts, loans or other actual or contingent financial obligations. The represented third parties are not entitled to that information. That information is properly requested by a spouse party. None of the represented third parties are spouse parties.
In paragraph 10 of Schedule B the represented third parties seek production from the wife of all documents (as defined) including books (as defined) in the period 24 September 2009 to date evidencing or recording a collection of interests, whether vested or contingent in property owned by the wife or by PPP Investments Pty Ltd. The represented third parties also seek production from the wife of all income earned by the wife, PPP Investments Pty Ltd, a trust over which the wife or PPP Investments Pty Ltd has direct or indirect control or of which the wife or PPP Investments Pty Ltd is a beneficiary.
The represented third parties have sought production of the documents enumerated in paragraph 10 as if the represented third parties were spouse parties to this litigation. They are not. They are not entitled to the documents requested in paragraph 10.
The same observations apply to the documents requested in paragraph 11 and 12 of Schedule B. The represented third parties are not spouse parties. Therefore, the represented third parties do not enjoy an automatic entitlement to disclosure of matters that would be discoverable as between spouse parties. The mere fact that the represented third parties are parties per se to this litigation does not confer on them a right to production of documents that mirrors the right to documentation enjoyed by a spouse party.
DEVELOPING THE POINT ON RULE 6.06
In debate on 1 May 2024, prior to the wife formulating her written submissions, Mr Dickson KC addressed briefly in respect of the rule 6.06 point. He pointed out that rule 6.06(2) provides that the requirements of rules 6.06(3) to (9) do not apply to a party who is not a party to the relevant marriage. In this case, self-evidently, the represented third parties are not parties to the marriage between Ms Jess and Mr Jess Snr.
Rule 6.06(3) sets out in seemingly exhaustive terms the documents that must be included in discovery in a financial proceeding where the party giving discovery is a party to the marriage. The represented third parties have mirrored the provisions of rule 6.06(3)(a) to (h) in their request for disclosure from the wife. They argued that as parties to a financial proceeding they are entitled to seek from the wife and obtain an order compelling her to disclose the items described in rule 6.06(3).
Superficially attractive as that argument may at first sight seem to be, in my view it is wrong. I say that for several reasons. First, as a matter of construction of rule 6.06(2), that rule provides that subrules (3) to (9) do not apply to a party to a property proceeding “who is not a party to the marriage” to which the application relates. The represented third parties are not a party to the marriage to which the application relates. The second reason is reposed in the exception for which provision is made in subrule 6.06(2). Two clauses within the sub rule are relevant to the exception. Relevantly, the inapplicability of subrules (3) to (9) relate to “a party to the property proceeding who is not a party to the marriage”. The second clause is “except to the extent that the party’s financial circumstances are relevant to the issues in dispute”. The first clause applies here to the represented third parties on the basis that they are parties to this property proceeding but not parties to the marriage. The second clause, containing the exception relates “to the extent that the party’s financial circumstances are relevant to the issues in dispute”. Reference to “the party’s financial circumstances” is a reference to the party who or which is not a party to the marriage, rendering the prima facie position to be that disclosure in a financial proceeding where a party to the proceeding is not a party to the marriage only applies where the non-spouse party’s financial circumstances are relevant to the issues in dispute. In that circumstance, the non-spouse party is required to give disclosure of matters relevant to the issues in dispute. The matters relevant to the issues in dispute vis-à-vis the wife and the represented third parties are delineated by the pleadings. Here the latest version of the pleadings between the wife and the represented third parties is the amended statement of claim, an amendment to which was foreshadowed by Mr CR. The existing amended statement of claim and the defence thereto defines the issues in dispute between the wife and the represented third parties. By reason merely of the represented third parties being parties to the property proceeding in this litigation, they are not entitled to the same disclosure as would apply between spouse parties.
Conventionally, the inapplicability of the disclosure relevant to non-spouse parties is illustrated where, say, a relative of a spouse party seeks repayment of a loan. In that circumstance, the disclosure applicable as between the spouse parties does not extend to disclosure about the alleged loan vis-à-vis spouse parties and his or her relative. Equally, if the Child Support Registrar is a party to the property proceeding, it could not be sensibly suggested that general discovery as between the spouse parties applied in relation to the Child Support Registrar.
The represented third parties seem to construe rule 6.06(3) as applying to them, requiring the wife to disclose on all matters recorded in subparagraphs (a) to (h) of rule 6.06(3). They have requested the wife to do precisely that in Schedule B. In my view, their reliance upon rule 6.06(2) and their request for documents mirroring those recorded in rule 6.06(3) is erroneous. The wife is not required to comply with that request.
UPSHOT
The represented third parties fail in their application in paragraph one of their application in a proceeding dated 13 March 2024. I dismiss all applications in paragraph one of that application in a proceeding insofar as it related to Schedule B.
If any application for costs is to be made arising out of these orders and reasons, any such application must be brought supported by all applicable affidavits and submissions by noon on 24 June 2024 which I will consider on the papers thereafter.
Orders as appear in the early pages of these reasons are otherwise made.
I certify that the preceding seventy-two (72) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Wilson. Associate:
Dated: 7 June 2024
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