Keach and Keach and Anor (No 3)

[2009] FamCA 1375

FAMILY COURT OF AUSTRALIA

KEACH & KEACH AND ANOR (NO. 3) [2009] FamCA 1375

FAMILY LAW – PROCEDURAL – SUBPOENAS – Leave to parties to inspect and copy documents pursuant to subpoena – leave to second respondent nunc pro tunc to file affidavit of witness

Family Law Act 1975 (Cth)

APPLICANT: Mr Keach

FIRST RESPONDENT: Ms Keach

SECOND RESPONDENT: J Pty Ltd

FILE NUMBER: SYF 2181 of 2006

DATE DELIVERED: 24 September 2009

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Strickland J

HEARING DATE: 24 September 2009

REPRESENTATION

COUNSEL FOR THE APPLICANT: In person

COUNSEL FOR THE FIRST RESPONDENT:

Mr North SC

with Mr Kearney

SOLICITOR FOR THE RESPONDENT: Barkus Doolan Kelly

COUNSEL FOR THE SECOND RESONDENT

Mr Maiden SC

with Mr Emmitt

SOLICITOR FOR THE SECOND RESPONDENT Esplins Solicitors

Orders

1. That leave is granted to the parties and their legal representatives to inspect and copy the documents produced pursuant to the subpoena to Elrington Boardman Allport.

2. That the second respondent have leave nunc pro tunc to file the affidavit of Mr H filed on 16 September 2009.

IT IS NOTED that publication of this judgment under the pseudonym Keach & Keach and Anor is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYF 2181 of 2006

MR KEACH

Applicant

And

MS KEACH

1^st Respondent

And

J PTY LTD

2^nd Respondent

EX TEMPORE REASONS

1. In this continuing matter, I now have an application before me by the second respondent for leave to file and rely on for the purposes of these proceedings an affidavit of Mr H sworn on 15 September 2009 and filed, without leave, on 16 September 2009.  Why I say “without leave” is that some time ago usual orders were made to prepare this matter for trial including that all affidavits that were to be relied upon were to be filed by 12 June 2009.  Thus, clearly it can be seen that this affidavit is well out of time. 

2. The application is opposed. 

3. First I need to say something else to put this application into context.  When this issue was first raised before me, it was said that before the wife’s legal representatives could determine whether the wife would object or consent to the filing of this affidavit, there was a need to obtain and inspect certain documentation, and I gave leave to issue a subpoena in relation to another affidavit which is not the subject of the application before me now.

4. There was a letter sent on 17 September 2009, namely the day after the filing of the affidavit under discussion, wherein the request was made for certain documents to be produced to the court at 10:00am on Monday 21 September 2009.  The letter read:

   “In the event that your client is permitted to rely upon that affidavit –”

   this being the affidavit of 16 September -

   “- would you please arrange to produce to the court, at 10 am on Monday, 21 September, the entirety of Mr [H’s] files including all financial statements, tax returns,, annual returns, working papers, file notes, minute books, correspondence and notices to ASIC in relation to –”

   and then there are a number of entities named. 

5. Now, as I understand it, certain documents were produced on Monday pursuant to that request but not all of the documents and, as I further understand it, further documents have been produced between Monday and now in purported compliance with that request for documents, and Mr Maiden SC tells me that, on his instructions, the gathering of documents to comply with this request indeed extended beyond the specific documents requested and included, for example, loan account ledgers and/or journals which were not requested in this letter but, nevertheless, they have been part of the production.  I am told that the general ledger up to 2006 was, in fact, produced on Monday 21 September and since then the 2007 ledger and the 2008 ledger have been supplied and then late last night there was the further provision of ledger accounts.

6. Additionally, I should mention that this application seems to be related to another application that I still need to deal with. We are at the stage of this case where we are about to embark upon the case of the second respondent, and Mr Keach Senior was to be the first witness and he had filed an affidavit on 12 June 2009, but there were certain objections taken to parts of that affidavit and I made rulings on that earlier in the week and gave leave to Mr Keach Senior to present further evidence in relation to specific paragraphs.  What has been done about that is a document has been prepared entitled “Proof of Evidence” which I am told is the further evidence of Mr Keach Senior in response to the leave that I gave but, in addition, this document sets out even further evidence that it is sought to be led from Mr Keach Senior and, in a general sense, as I understand it, that evidence is said to be necessary as a result of evidence that has been given during the course of this case to date. The point of that is, as I understand it, there will be argument about that and objection will be taken to parts of the evidence that are proposed to be led and which are set out in this document and, in particular, for example, there are two annexures to this document, FJK1 and FJK2, to which particular objection will be taken.

7. The outcome of the application that is now before me in relation to the affidavit of Mr H will, in all likelihood, determine some, if not all of the issues that arise out of that document that I have just referred to.

8. I have been provided with extensive submissions about this and I have also been provided with bundles of documents.  The history in terms of the documents dates back to February 2007.  I have taken some time to consider this application and I will in a moment go through some of the historical documents relevant to it, but I just wanted to say immediately that I am somewhat bemused as to the submissions that I have received given that, upon a close reading of the affidavit of Mr H, it seems to me to be a very general affidavit where he deposes to his qualifications and his engagement to undertake certain accounting work for a number of entities including the second respondent and, perhaps in a general sense, I can say for the Keach Group of Companies, and I make the point that nowhere that I can see in this affidavit is there any reference to or mention directly or indirectly of any loan account ledgers or journals which appears to have been the subject of the extensive submissions made before me and a particular subject of the bundles of documents that have been tendered before me.

9. My bemusement, to be more specific, is this:  The application before me is for leave to file and rely on this affidavit.  If I acceded to that application, that would obviously put the affidavit into evidence. However, there are no annexures to it, and it does not refer to any other documents. 

10. Thus I fail to see why I have been taken up hill and down dale to documentation, letters, orders of the court, subpoenas in relation to various documents and seemingly, in the end, to loan account ledgers and the like.  I raised this with counsel for the wife when I was asked to come back into court to hear some further submissions, and his response to that was, “Well, it all needs to be seen in context and it relates as well to the further evidence that is sought to be led from Mr [Keach] Senior.” 

11. However, I am dealing with one application and one application only and, in due course I assume I will be taken to this issue and hear argument about it as to what evidence can be adduced and what cannot be adduced from Mr Keach Senior.  In anticipation of that, though, I want to make some general comments.  I have looked closely at and read each and every one of these documents that has been provided to me.  I have not read all of the documents in the bundle which have been provided to me as an aide memoir and which comprises subpoenaed documents but their nature and content is quite apparent to me and, indeed, the history is not greatly in issue.  There is, perhaps one issue that relates to the recent history of the matter, and by that I mean from about July to now.  It is quite clear going back to February 2007 that, at that time, there were orders made and subpoenas issued seeking a number of documents in relation to the Junior Trust and the Senior Trust as they have been described in these proceedings, and specifically seeking copies of all ledgers in respect of money paid whether by way of distribution of income, loan or otherwise and in the list of persons and entities, the husband’s name appears.  And it is quite apparent that those documents, in particular, if they were in existence, have not been produced pursuant to the subpoenas that were issued and Mr Kearney is quite correct in saying that what that indicates is that from that point on it was open to the wife to proceed on the basis that there were no such documents to be produced and she, thereafter and most recently, concentrated on seeking production of other documents outside of any ledger documents. To my mind that answers directly and specifically the submission put to me on behalf of the second respondent that since at least 31 July 2009 no specific request has been made for ledgers or journals in the nature of ledgers and, in particular, in relation to loan account ledgers.  Indeed, I recall it was put to me by Mr Maiden SC that there had been no such specific request since his client, the second respondent, was made a party but, in that context, I was referred to an order of Watts J of 18 November 2008 wherein ledger accounts were mentioned. In paragraph 5.4 of that order Watts J ordered that, “within 21 days the second respondent provide to the wife all ledger accounts of the Junior Trust identifying transactions on the loan account of the husband.”

12. Now, I understand, and there has been no challenge to this, that there was no such documents provided pursuant to that order and, as I say, as far as I am concerned, it was open to the wife and understandable for her to proceed on the basis that there were no such documents. 

13. Since July 2009, there has been a series of correspondence and a subpoena issued and a notice to produce delivered, all directed to ensuring the complete preparation of this matter so that it could proceed in the week commencing 21 September 2009, namely this week.  The second respondent’s position in relation to that is that the notice to produce of 10 September 2009 required us to produce documents on 21 September 2009. 

14. That notice did not include a request for production of documents such as loan account ledgers and, as far as I am concerned, the reason for that is as I have explained earlier.  So what, as I understand it, the second respondent says is to the effect that all we have done is we have complied with that notice to produce and we have now complied with the request of 17 September 2009 and so we should now be able to proceed in this matter with the affidavit of Mr H. However, it is the next step which we have not reached which, I assume, there will be much argument about.  I assume that what all that is leading to is that the second respondent, in some way, which escapes me for the moment, will be seeking to tender documents including loan account ledgers and the like as part of the respondent’s case.  Well, if that is what the second respondent thinks, the second respondent has another think coming.

15. At the moment there is no such application before me, there is no such documentation to which I have been referred or which it is indicated will be presented as part of the second respondent’s case.  To repeat, all I have is an affidavit of Mr H, a general affidavit which does not annex any documents, does not refer to any documents of this nature and, I am being asked to give leave for it to be filed and relied upon. And I am not going to predict or speculate as to what further applications might be made before me.  I can only deal with what is currently before me and that is what is before me at the moment. 

16. Thus, whether I need to go any further in addressing the submissions specifically that have been put to me or this bundle of documents that has been put before me, as I say, I intended to make some general statements about it and I have now done so.  One further comment I make is that it is quite clear from what I have been told as to what documents are now being produced, that there were loan account ledgers to be produced and for some unexplained reason, they have not been.  Mr Maiden SC, in his submissions, said absolutely nothing about that.  Certainly he did not provide any excuse for what is an obvious failure by the second respondent to comply with orders of this court. There have also been subpoenas, namely to W Accountants, who are the accountants for the second respondent, and to the Keach Trust.  I am assuming, and someone will correct me if I am wrong, but that is the Senior Trust.  However, the fact of the matter is that with the subpoena to the accountants of the Junior Trust, there was no production of the documents which apparently were available, yet now they are being produced in the week of the trial and indeed on the fourth day of the trial. Further I am still not clear whether there has been complete production in relation to this issue.  All I am told is as of 8 o’clock last night or some such hour that further documents were received.  Extraordinary, but consistent, I am sorry to say, with the history of this matter going back to February 2007.  I note just by way of another further comment that there is a letter handed up to me after I returned to hear further submissions, a letter of 24 July 2009 from Esplins Solicitors to Barker Steel & Kelly.  It is responding to a letter of 6 July which was a letter from Barker Steel & Kelly to Esplins Lawyers requiring the second respondent to produce, for inspection, pursuant to rule 13.09 of the Family Law Rules certain documents.  Now, the response is:

    “In regards to your client’s notice to produce, we refer you to rule 13.02 of the Family Law Rules and the fact that our client, the [Junior] Trust, is not a party to the marriage to which the application for financial orders relates.  As such, there is no duty of disclosure except to the extent a party’s financial circumstances are relevant to the issues in dispute.  Accordingly, the obligation is on your client to demonstrate which documents, if any, fall within the ambit of the rule and then restrict the notice to those documents.”

17. How extraordinary.  Rule 13.02 is a rule about disclosure.  There is an ongoing obligation in that regard on each and every party to proceedings.  Thus, in the context of Rule 13.02, the ongoing obligation on the second respondent is to provide disclosure of all relevant documents in relation to its financial circumstances.  To say that you, the wife, have to identify the documents which you require is an extraordinary statement to make and one which concerns me greatly given it is a statement from experienced family law practitioners, and if that is an example of how this litigation has been conducted in the lead up to this trial, I am further concerned about what has been happening or rather not happening. 

18. I can perhaps put it in stronger language but it is therefore no wonder that on the fourth day of this trial with that history and that attitude and that approach that I am now faced with, in effect, the prospect of adjourning these proceedings because of the failure by a party, the second respondent, to comply with orders for the filing of affidavits by a certain time and to comply with orders for the production of documents made as long ago as November 2008. 

19. However to return to the issue that I still see as before me, and which is plain and simple, namely this affidavit and its reception.  I cannot see, on the face of the document any serious prejudice to the wife to give leave to file and rely upon this affidavit, given that I am only addressing this affidavit per se. 

20. Now, I have not heard anything said about this, but obviously, if I allow this affidavit to be filed and it is said that there are some issues in there that, for example, the wife needs to be recalled about then I will hear that application.  My preliminary view about that though is that I cannot see that there would be any need for it but, certainly, I accept that if we are talking about the production and reliance upon on a number of documents which have only just been produced and should have been produced earlier, there would be serious prejudice to the wife and the prospect of an adjournment looms large and, obviously, issues of costs in relation to that also loom large but, to repeat, that is not what I am dealing with.

21. Thus, in relation to the application for leave to file and rely upon the affidavit of Mr H, filed on 16 September 2009, I give leave nunc pro tunc, for that affidavit to be filed and obviously therefore it can be relied upon in the second respondent’s case.

I certify that the preceding twenty-one (21) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Strickland.

Associate