Lawlor v Courtesy Real Estate (NSW) Pty Limited and Ors (No.2)
[2014] FCCA 1922
•26 August 2014
FEDERAL CIRCUIT COURT OF AUSTRALIA
| LAWLOR v COURTESY REAL ESTATE (NSW) PTY LIMITED & ORS (No.2) | [2014] FCCA 1922 |
| Catchwords: PRACTICE AND PROCEDURE – Application to set aside part of subpoena for production of documents – whether subpoena issued for legitimate forensic purpose – whether subpoena oppressive. |
| Lawlor v Courtesy Real Estate (NSW) Pty Ltd& Ors [2014] FCCA 1471 |
| Applicant: | SALLY-ANNE LAWLOR |
| First Respondent: Second Respondent: Third Respondent: Fourth Respondent: Fifth Respondent: Sixth Respondent: Seventh Respondent: | COURTESY REAL ESTATE (NSW) PTY LIMITED ACN 002 934 152 T/AS RAY WHITE LOWER NORTH SHORE PETER DOUGLAS MATTHEWS KINGSLEY RAYMOND YATES SHANE MICHAEL SLATER RAY WHITE (NEW SOUTH WALES) PTY LIMITED STEPHEN JOHN NELL STUART DAVIES |
| File Number: | SYG 827 of 2013 & SYG 2450 of 2013 |
| Judgment of: | Judge Manousaridis |
| Hearing date: | 19 August 2014 |
| Delivered at: | Sydney |
| Delivered on: | 26 August 2014 |
REPRESENTATION
| Counsel for the Applicant: | Mr A Howell |
| Solicitors for the Applicant: | Harmers Workplace Lawyers |
| Counsel for the First, Second, Third and Fourth Respondents: | Mr G Johnson |
| Solicitors for the First, Second, Third and Fourth Respondents: | Gilbert & Tobin |
ORDERS
Paragraph 2 of the subpoena issued on 29 July 2014 by the applicant to the first respondent (subpoena) is set aside to the extent it calls for the production of the first respondent’s income tax returns and assessments of tax.
Paragraph 15 of the subpoena is set aside.
The first respondent produce all documents on the basis of which it instructed Mr Pomeroy to depose in his affidavit sworn on 11 August 2014 that the first respondent had received 753 office leads during the calendar years 2008 to 2012 inclusive.
The first respondent produce all documents on the basis of which it instructed Mr Pomeroy to depose to the matters contained in paragraph 9 of his affidavit sworn on 11 August 2014.
To the extent the subpoena calls for the production of the documents described in paragraph 3 of the subpoena, the subpoena stand over generally subject to the applicant having liberty to apply for the production of the documents referred to in paragraph 3 of the subpoena, such liberty to be exercised after the first respondent has produced, and the applicant has inspected, the documents referred to in order 4.
The first respondent produce the documents called for by the subpoena, as modified by these orders, and the documents referred to in paragraph 4 of these orders by midday, 18 September 2014.
Subject to order 8, the applicant and first respondent will bear their own costs of the first respondent’s application to set aside paragraphs 2, 3, and 15 of the subpoena.
The parties have liberty to apply to the Court to vary order 7, provided such application is made by no later than 16 September 2014.
The applicant shall serve all affidavits on which she relies including in relation to loss by 9 October 2014.
The respondents shall serve all affidavits upon which they rely by 6 November 2014.
Any additional subpoenas and any application for interrogatories or discovery by either party shall be filed and served by no later than 4pm, 21 November 2014.
The matter is listed for further directions at 9.30 on 28 November 2014.
The parties have liberty to apply to have the matter relisted upon the giving of three days notice.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 827 of 2013 & SYG 2450 of 2013
| SALLY-ANNE LAWLOR |
Applicant
And
| COURTESY REAL ESTATE (NSW) PTY LIMITED ACN 002 934 152 T/AS RAY WHITE LOWER NORTH SHORE First Respondent PETER DOUGLAS MATTHEWS KINGSLEY RAYMOND YATES SHANE MICHAEL SLATER RAY WHITE (NEW SOUTH WALES) PTY LIMITED STEPHEN JOHN NELL STUART DAVIES |
Seventh Respondent
REASONS FOR JUDGMENT
Introduction
There has been referred to me a notices of objection filed by each of the first, second, third, and fourth respondents seeking orders in relation to subpoenas for production that have been served on each of them. Each of the second, third, and fourth respondents seeks an order that the subpoena served on him be set aside in its entirety. The first respondent seeks an order that paragraphs 2, 3, and 15 of the subpoena issued to it be set aside.
At the hearing of the application on 19 August 2014, the applicant agreed she will not press, at this stage, the production of the documents called for by the subpoenas issued against the second, third, and fourth respondents. The applicant reserved her position to press for the production of those documents after she inspects documents the first respondent will produce in response to those parts of the subpoena issued against the first respondent to which the first respondent does not object.
Accordingly, in these reasons for judgment, I consider the first respondent’s application to set aside paragraphs 2, 3, and 15 of the subpoena issued against the first respondent. Before I identify the documents called for by those paragraphs, and the grounds on which the first respondent seeks to set them aside, it will be necessary to set out the nature of the claims the applicant makes in these proceedings, and the issues to which the applicant claims the documents called for by these paragraphs relate.
Issues in the proceedings
As I said in Lawlor v Courtesy Real Estate (NSW) Pty Ltd& Ors,[1] the applicant, Ms Lawlor, is a real estate agent who was an employee of the first respondent. She alleges she was induced to enter into a contract of employment with the first respondent as a result of misrepresentations made to her; and, while employed, the first respondent breached the contract of employment, and unlawfully discriminated against her. Ms Lawlor further claims that, as a result of the first respondent’s misrepresentations, breach of contract, and discrimination, Ms Lawlor suffered loss or damage, being loss of income, bonuses and other benefits as an employee of the first respondent, loss of opportunity for advancement in the first respondent, offence, humiliation, distress and anxiety, damage to persons and professional reputation, and medical expenses.
[1] [2014] FCCA 1471 at [10]
Particularly relevant to the issues that arise on the application before me are three allegations made in the combined statement of claim. The first is the allegation made in paragraph 12(c) that before she entered into a contract of employment with the first respondent, the first respondent represented to her that it will ensure that Ms Lawlor’s income would not be lower than her then current income by taking measures such as giving her overflow leads and listings from other directors. The second allegation is that contained in paragraph 17(c) of the combined statement of claim that, contrary to the representation pleaded in paragraph 12(c) of the combined statement of claim, Ms Lawlor was not given the promised support with respect to overflow leads and listings. And the third allegation is that made in paragraph 27(a) of the combined statement of claim that during the course of her employment the first respondent treated Ms Lawlor less favourably than her male colleagues by providing office leads and listings to male colleagues in preference to Ms Lawlor.
Documents called for by paragraph 15 of subpoena
Paragraph 15 of the subpoena issued to the first respondent calls for “all documents in relation to the allocation of clients, leads and listings of the Business from 14 April 2008 to 4 February 2013”. The first respondent has objected to these paragraphs of the subpoena on the grounds that:
a)the documents cannot relate to any legitimate forensic purpose;
b)paragraph 15 does not describe with sufficient specificity the documents it requires to be produced and, for that reason, constitutes an impermissible substitute for discovery; and
c)paragraph 15 is oppressive.
I am satisfied the documents called for by paragraph 15 are for a legitimate forensic purpose. The documents described in paragraph 15 on their face appear to relate to the allegations made in paragraphs 12(c), 17(c), and 27(a) of the combined statement of claim.
I am also satisfied that the manner in which paragraph 15 describes the documents does not manifest an impermissible attempt to obtain discovery of documents. To comply with paragraph 15 of the subpoena will not require the first respondent to make a judgment about whether the documents relate to a particular issue or issues that arise on the pleadings. The only judgment the paragraph would require the first respondent to make is whether it has documents that fall within the scope of the paragraph. From the affidavit sworn by Mr Pomeroy on behalf of the first respondent to which I refer below, I infer the first respondent does not anticipate any difficulty in being in a position to identify the documents that are called for by paragraph 15.
I now turn to oppression, which is a recognised ground for setting aside a subpoena or part of a subpoena. Whether or not a subpoena is oppressive requires the Court to balance the apparent relevance of the documents called for by the subpoena to the issues in the case and the burden of obedience the subpoena would impose if the subpoena is not set aside. If a single sentence could be framed to state when a subpoena will be oppressive, it would be this: a subpoena, or part of a subpoena, will be oppressive if the burden of complying with it substantially outweighs the expected utility of complying with it. The burden of compliance must be assessed by reference to the time and cost the person who received the subpoena is likely to expend and incur in complying with the subpoena. And the expected utility of compliance with the subpoena must be assessed by the apparent relevance of the documents called for by the subpoena to the issues in the case.
The first respondent has read an affidavit of Mr Pomeroy, the first respondent’s solicitor, which sets out the burden the first respondent will face if it were to comply with paragraph 15 of the subpoena. Mr Pomeroy deposes that there is a well-known class of event that regularly occurs in the course of the first respondent’s business, and that event is called an “office lead”. An office lead describes a potential vendor who contacts the first respondent’s office, usually by telephone, to express an interest in selling a property, and that vendor has not dealt with an agent of the first respondent or, having dealt with an agent of the first respondent, desires to deal with another agent of the first respondent. Mr Pomeroy deposes that during the calendar years 2008 to 2012, the first respondent received 753 office leads. Mr Pomeroy further deposes that if paragraph 15 of the subpoena is not set aside, the first respondent would be required to search its email archives in relation to the allocation of an office lead to a sales agent, and that it is estimated such search will take one person at least five full business days to complete. The first respondent would also be required to search its records in relation to sold properties which resulted from office leads during the period 14 April 2008 to 4 February 2012 [sic]; and this will require a review of the first respondent’s hard copy records that will take approximately five full business days.
As I understand it, the purpose for which Ms Lawlor seeks the documents called for by paragraph 15 is to show that office leads the first respondent received during Ms Lawlor’s employment with the first respondent either were not allocated to Ms Lawlor or there was discrimination in relation to the number of office leads that were allocated to Ms Lawlor. Ms Lawlor submits that this will be relevant not only to establishing the allegations I have identified earlier in these reasons, but also to calculating her damages. If that is its purpose, paragraph 15 of the subpoena, particularly the use of the words “in relation to”, is likely to call for many documents that will have only marginal relevance to proving the allegations made in the combined statement of claim and damages. That is so because paragraph 15 is likely to call for a large number of documents whose only relevance will be that they form part of a chain of documents which may lead to a relevant document.
In my opinion, from the fact that the first respondent has identified 753 “office leads”, I infer that there are documents from which these 753 office leads have been identified. I further infer that these documents identify the name of the vendor and the property the vendor was interested in selling. If that is so, that should satisfy the purpose for which Ms Lawlor seeks the documents described in paragraph 15 of the subpoena. With the use of documents called for by paragraph 3 of the subpoena (as modified in the manner I describe later in these reasons), Ms Lawlor will be able to prove the office leads the first respondent received during Ms Lawlor’s employment with the first respondent, and how many of those office leads resulted in the execution of an agency agreement with the vendors who initiated the office lead.
Accordingly, I propose to set aside paragraph 15 of the subpoena but instead order that the first respondent produce all documents on the basis of which the first respondent determined it had received 753 office leads during the calendar years 2008 to 2012 inclusive.
Documents called for by paragraph 3 of subpoena
Paragraph 3 of the subpoena calls for “all executed agency agreements of the Business for the period from 14 April 2008 to date”. The first respondent submits there is no legitimate forensic purpose to the production of these documents and, in any event, it would be oppressive for the first respondent to comply with paragraph 3.
The purpose for which Ms Lawlor seeks production of the agency agreements, as I understand it, is to provide a basis for calculating the proportion of office leads that were converted to the execution of an agency agreement. Ms Lawlor, in turn, proposes to use that evidence as an element in her calculation of loss. If, for example, Ms Lawlor proves there was unlawful discrimination in the allocation of office leads, and that a proportion of office leads were converted to signed agency agreements, Ms Lawlor may have a basis for claiming that, but for the discrimination, she would have acted for more vendors who had signed agency agreements than she in fact acted for and, therefore, she was deprived of the opportunity of earning greater earnings than she in fact did earn. In my opinion, this is a legitimate forensic purpose to Ms Lawlor’s calling for the production of the documents referred to in paragraph 3 of the subpoena.
As to oppression, Mr Pomeroy deposes that during the period for which Ms Lawlor seeks production of agency agreements, the first respondent holds an agency agreement for each of the 2,039 properties that had been listed for sale by the first respondent. Mr Pomeroy deposes that the first respondent estimates it will take an administrative employee at least ten full business days to search its archives, identify and copy each of the 2,039 agency agreements.
In my opinion, there is little utility in requiring the first respondent to search for and copy 2,039 agency agreements, the bulk of which would consist of standard terms and conditions, if the first respondent has other records from which it can readily identify the number of agency agreements it holds, and information such agreements record. And from the fact that Mr Pomeroy deposed that the first respondent holds 2,039 agreements, I infer that the first respondent does hold records which identify the agency agreements that have been signed during the period after April 2008 and that those records would contain information detailing the properties and, perhaps more.
At this stage, I will neither set aside paragraph 3 of the subpoena nor require the first respondent to produce the documents referred to in paragraph 3 of subpoena. Instead, I will order the first respondent to produce the documents on the basis of which the first respondent was able to inform Mr Pomeroy of the information contained in paragraph 9 of his affidavit, and grant Ms Lawlor liberty to apply for an order that the first respondent produce the documents called for by paragraph 3 of the subpoena.
Documents called for by paragraph 2 of subpoena
Paragraph 2 of the subpoena calls for the production of “all income tax returns, assessments of tax, . . . profit and loss statements and balance sheets of [the first respondent] for the period from 14 April 2008 to date”.
The asserted legitimate forensic purpose for which Ms Lawlor seeks these documents is to prove her loss. As I understand it, Ms Lawlor will claim that, but for the discrimination practised against her, she would have received a greater share of the first respondent’s profits than she in fact did.
The profit and loss documents and the balance sheets called for by paragraph 2 of the subpoena are documents which it is on the cards will materially assist the applicant in proving her loss because those documents will show whether or not the first respondent earned profits and, if so, how much of the profits were distributed. In my opinion, however, it is not on the cards that income tax returns and assessments of tax will materially assist Ms Lawlor showing anything more than what would be disclosed by the first respondent’s profit and loss statements and balance sheets.
Accordingly, I propose to set aside that part of paragraph 2 of the subpoena that calls for income tax returns and assessments of tax.
Disposition
I propose to dispose of the first respondent’s application to set aside paragraphs 2, 3 and 15 of the subpoena as follows:
a)I will order that paragraph 2 of the subpoena be set aside to the extent it calls for the production of the first respondent’s income tax returns and assessments of tax.
b)I will order that paragraph 15 of the subpoena be set aside, and instead order that the first respondent produce all documents on the basis of which it instructed Mr Pomeroy it had received 753 office leads during the during the calendar years 2008 to 2012 inclusive.
c)I will order that the first respondent produce the documents on the basis of which the first respondent was able to inform Mr Pomeroy of the information contained in paragraph 9 of Mr Pomeroy’s affidavit.
d)I will stand over the subpoena to the extent it calls for the production of the documents referred to in paragraph 3, and reserve to Ms Lawlor the liberty to apply to the Court to press for the production of the documents called for by the paragraph, noting that such application is not to be made until after the first respondent has produced, and Ms Lawlor has inspected the documents referred to in (c).
As for costs, each side has had a measure of success. I propose to order that Ms Lawlor and the first respondent bear their own costs of the application to set aside paragraphs 2, 3, and 15 of the subpoena. I will, however, grant the parties liberty to apply for a different costs order, provided such application is made by no later than 16 September 2014.
I certify that the preceding twenty four (24) paragraphs are a true copy of the reasons for judgment of Judge Manousaridis
Associate:
Date: 26 August 2014
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