Millman & Millman
[2021] FedCFamC1F 39
•14 September 2021
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Millman & Millman [2021] FedCFamC1F 39
File number(s): ADC 30 of 2020 Judgment of: BERMAN J Date of judgment: 14 September 2021 Catchwords: FAMILY LAW – PRACTICE AND PROCEDURE – Registrar – Review of Decision – Subpoenas – Where the Department of Home Affairs produced documents sought under Subpoena – Where the husband and the second respondent objected to the Subpoena – Where a Registrar made orders for the inspection of some of the subpoenaed material – Where the husband and second respondent sought a review of the decision – Discussion of the practice and procedures where a subpoena for the production of documents is issued – Consideration of whether the documents sought under the subpoena are relevant to issues in the proceedings – Consideration of whether the second respondent would have been required to provide the Department with information in relation to his financial circumstances when applying for a visa or citizenship – Where the wife would not have known at the time the subpoena was issued whether the second respondent would have been required to provided the Department with financial information – Subpoena set aside. Legislation: Migration Act 1958 (Cth) s 499
Family Law Rules 2004 (Cth) Ch 13, Pt 15.3
Migration Regulations1994 (Cth) Sch 1, Sch 2
Cases cited: Andrew Garrett Wine Resorts & Anor v National Australia Bank Limited (No. 6) (2005) 92 SASR 419
Dupont & Chief Commissioner of Police and Anor (2015) FLC 93-648
Hatton v Attorney-General of the Commonwealth of Australia & Ors (2000) FLC 93-038
Hennessy v Wright (No. 2) (1888) 24 QBD 445
Lucas Industries Ltd v Hewittand Others (1978) 18 ALR 555
Martin & Martin and Anor (No.2) [2014] FamCA 232
National Employers’ Mutual General Association Limited v Waind and Hill [1978] 1 NSWLR 372
Papadopoulos & Papadopoulos (No. 2) [2007] FamCA 1683
Ryder & Lee [2009] FamCA 531
Unitingcare – Unifam Counselling & Mediation & Harkiss and Anor (2011) FLC 93-476
Woley & Humboldt (No. 4) [2009] FamCA 546
X Pty Ltd and Ors & Merhi [2015] FamCA 622
Division: Division 1 First Instance Number of paragraphs: 55 Date of hearing: 11 August 2021 Place: Adelaide Counsel for the Applicant: Mr Bullock Solicitor for the Applicant: Douglas Hoskins Legal Counsel for the First Respondent: Ms Lewis Solicitor for the First Respondent: Jacqui Ion Lawyers Pty Ltd Counsel for the Second Respondent: Mr Heinrich Solicitor for the Second Respondent: Angela Ferdinandy ORDERS
ADC 30 of 2020 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR FAZIL
Applicant
AND: MS MILLMAN
First Respondent
MR MILLMAN
Second Respondent
ORDER MADE BY:
BERMAN J
DATE OF ORDER:
14 SEPTEMBER 2021
THE COURT ORDERS:
1.That the subpoena directed to the Proper Officer of the Department of Home Affairs issued on 26 May 2021 be set aside.
2.That the documents produced by the Proper Officer on behalf of the Department of Home Affairs remain in the Adelaide Registry of the Family Court of Australia for a period of twenty eight (28) days at which time unless the wife has filed a further subpoena in relation to the said documents, they shall be destroyed.
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).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish 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 the pseudonym Milman & Milman has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
BERMAN J
INTRODUCTION
By Further Amended Initiating Application filed 25 May 2021, Ms Millman (“the wife”) seeks orders for property settlement and parenting orders. Mr Millman (“the husband”) opposes the orders sought by the wife and relies upon his Amended Response filed 15 June 2020 and his Amended Reply filed 27 October 2020.
The wife seeks to set aside the transfer by the husband to Mr Fazil, the second respondent in the substantial proceedings, (“Mr Fazil”) of three businesses being the E Centre owned and operated by E Pty Ltd as trustee for W Trust, the T Practice owned and operated by T Pty Ltd as trustee for T Trust and U Practice owned and operated by U Pty Ltd as trustee for U Trust.
The husband and Mr Fazil entered into negotiations which resulted in a deed of agreement, whereby the transfer of the entities holding the three businesses resulted in the release of the husband from all debts owing to Mr Fazil pursuant to demand and then proceedings issued against the husband, initially claiming the sum of $5,467,459 and following a payment of $600,000 reduced to $4,867,459.
The wife denies any knowledge of the monies purportedly loaned by Mr Fazil to the husband and it is agreed that the transfer of the businesses occurred without the wife’s knowledge.
All applications for final orders have been listed for hearing on 1 November 2021.
By Amended Application in a Case filed 15 June 2021, the wife sought an order either by way of litigation funding or partial settlement of property that the husband do pay to her solicitors the sum of $233,055 on account of her legal fees.
The husband submitted that the wife’s application should fail on the basis that she did not have an arguable case.
Judgment was delivered on 2 August 2021 that rejected the contention of the husband and Mr Fazil that the wife did not have an arguable case and an order was made that the husband pay to the wife’s solicitors the sum of $77,000 by way of interim property settlement.
THE SUBPOENA
By subpoena issued 26 May 2021, directed to the Proper Officer of the Department of Home Affairs (“the Department”), the wife sought the production of documents provided by Mr Fazil to the Department in support of his applications for a working visa, permanent residency and Australian citizenship. Specifically, the wife was seeking the production of documents in relation to Mr Fazil’s personal assets and liabilities and any documents pertaining to financial support provided by the husband and or members of the husband’s family.
On 15 June 2021, the husband filed a Notice of Objection in relation to the subpoena on the basis of relevance. On 23 June 2021, Mr Fazil filed a Notice of Objection arguing that the documents sought are not relevant, the subpoena lacks a legitimate forensic purpose, the subpoena amounts to a fishing expedition, is oppressive and invades Mr Fazil’s privacy.
On 20 July 2021, a Registrar made orders which permitted the parties to inspect and copy certain documents produced by the Department under the subpoena, namely those identified as:
·… – electronic 10/6/2021 11.00am File folder; and
·… – paper.PDF 2/06/2021 12.29pm Adobe Acrobat Document 28,401KB
By Applications in a Case filed 21 and 22 July 2021, Mr Fazil and the husband seek a review of the Registrar’s orders. The wife opposes the applications and considers the documents are relevant and that Mr Fazil would have been required to disclose all of his assets and liabilities to the Department in support of his applications.
The wife relies upon her affidavit filed 6 August 2021. The context in which the subpoena was issued is the accurate summary of the husband’s evidence that during the period 1993 to 2020, Mr Fazil loaned him the sum of $2,669,762 which accrued interest of $2,767,697.
Mr Fazil immigrated to Australia in 2006 and as at the end of that year the husband asserts that he owed the Mr Fazil $961,219 plus unspecified interest.
It is not controversial that Mr Fazil asserts that the husband owed him $961,219 and that the principle and interest owing at 30 June 2006 was $1,663,811.90.
The wife considers that as part of Mr Fazil’s application for a working visa, then permanent residency and finally Australian citizenship, he was required to provide a statement of assets and liabilities to the Department. In paragraph 9 of her affidavit, the wife asserts that Mr Fazil “would be obliged to disclose all of his assets and liabilities to the Department”.[1]
[1] Affidavit of the wife filed 6 August 2021, paragraph 9.
LEGAL PRINCIPLES
Chapter 13 of the Family Law Rules 2004 (Cth) imposes an obligation of full and frank disclosure on parties to Family Court proceedings and the manner by which that obligation must be fulfilled.
The general practice as it relates to subpoenas to produce documents is explained by Smithers J in Lucas Industries Ltd v Hewittand Others (1978) 18 ALR 555 at 570:
The purpose of the process of subpoena is to facilitate the proper administration of justice between parties. For that purpose it is the policy of the law that strangers who have documents may be put to certain trouble in searching for and gathering together relevant documents and bringing them to court. It is according to the same principle that persons who have knowledge of facts are put to the inconvenience of being brought to court and required to give evidence.
A named person or a person who has sufficient interest in a subpoena may seek an order for the subpoena to be set aside in whole or in part, or may object to production, inspection or photocopying of the documents required by subpoena.[2]
[2] Family Law Rules 2004 (Cth) r 15.26.
The primary test is the relevance of the documents to the issues before the Court. The Full Court in Hatton v Attorney-General of the Commonwealth of Australia & Ors (2000) FLC 93-038 (“Hatton”) considered the test of relevance and set out examples of where a court may determine where it is proper to set aside a subpoena:
·If the subpoena is for an improper purpose, namely to obtain discovery against a third party;
·Where it might be oppressive to comply with the subpoena;
·Where a party embarks upon a “fishing expedition”; and
·Where the subpoena lacks relevance to the proceedings.
The decision of X Pty Ltd and Ors & Merhi [2015] FamCA 622 concerned an application seeking review of orders made by the Registrar, dismissing objections to subpoenas issued by the Court. The applicants were twelve companies that had been served with subpoenas (companies of which the husband had an interest in). McClelland J found that the subpoenas were inappropriate because:
43.… Essentially, they are speculative in the sense that they are a “train of inquiry” that might assist the wife’s case rather than it being “on the cards” that they will result in the production of documents that will be relevant to the issues in the case. To that extent the subpoenas to those companies amount to “fishing” and should be set aside.
His Honour gave an overview of the law referring to the power of the Court to issue a subpoena set out in Pt 15.3 of the Rules, and the power to set aside a subpoena so issued.
At [25] his Honour refers to Hatton (supra), in particular the relevant stages of having a third party bring documents to the Court being a three step process:-
The relevant stages of having a third party bring documents to court were described in Hatton (supra) at [38], by reference to National Employers’ Mutual General Association v Waind and Hill [1978] 1 NSWLR 372, as being a three step process:
The first [step] is obeying the subpoena, by the witness bringing the documents to the court and handing them to the judge. This step involves the determination of any objections of the witness to the subpoena, or to the production of the documents to the court pursuant to the subpoena. The second step is the decision of the judge concerning the preliminary use of the documents, which includes whether or not permission should be given to a party or parties to inspect the documents. The third step is the admission into evidence of the document in whole or in part; or the use of it in the process of evidence being put before the court by cross-examination or otherwise…This application by the applicant companies concerns the first step referred to in Hatton (supra)…
In Dupont & Chief Commissioner of Police and Anor (2015) FLC 93-648 (“Dupont”) the Full Court applied the principles enunciated in National Employers’ Mutual General Association Limited v Waind and Hill [1978] 1 NSWLR 372 and Hatton (supra) and found that a subpoena must only be used for a legitimate forensic purpose. A subpoena that does not have a legitimate forensic purpose is an abuse of process and must be set aside. In Dupont (supra), an objection was made to the production of documents under subpoena on public interest immunity grounds. The Full Court helpfully outlined the “usual procedure adopted”[3] when a subpoena for the production of documents is issued:
[3] Dupont & Chief Commissioner of Police and Anor (2015) 93-648 at [35].
36.… This first step involves the determination of any objections to the subpoena or to the production of the documents. It is at this stage that the court will consider any claim by the person to have the subpoena set aside on the basis it is oppressive, is an abuse of process and the like and, relevantly, public interest immunity. …
…
40.The second step is the decision concerning the preliminary use of the documents, which includes whether or not permission should be given to a party or parties to inspect the documents produced to the court and under its control. In this regard, the crucial question is whether the documents have apparent relevance to the matters in issue or are themselves the subject matter of the litigation. …
41.The third step is the admission into evidence of a document or its use in the process of taking evidence. It is at this step that questions between the parties of relevance in fact and admissibility are determined.
(Citations omitted)
In Martin & Martin and Anor (No. 2) [2014] FamCA 232 (“Martin”) Cronin J found that the focus of the Court should be whether it was “on the cards”[4] that the documents would materially assist the proceedings. At [28], Cronin J referred to his own comments in Woley & Humboldt (No. 4) [2009] FamCA 546, where he said:
[4] Martin & Martin and Anor (No.2) [2014] FamCA 232 at [28].
39.In Hudson Timber and Hardware Ltd v Chaudhary Group Pty Ltd [2002] FCA 832 the Full Court of the Federal Court examined the issue of apparent relevance and said that the relevant principles governing the obtaining of documents on subpoena which have “apparent relevance” were that inter alia:
(1)The relevance of documents was not limited to documents directly admissible in themselves in proof of an issue raised in pleadings; and
(2)If a class of document which has material forensic relevance could be shown to exist, then a subpoena would not normally be set aside.
40.In White v Tulloch (1995) FLC 92-640, the Full Court of the Family Court referred to the test in terms of documents having “a sufficient apparent connection to justify their production or inspection”.
41.In Trade Practices Commission v Arnotts Ltd (No 2) (1989) 21 FCR 306, Beaumont J saw relevance as something where a document “could possibly throw light on the issues in the main case”.
42.In Portal Software International Pty Ltd v Bodsworth, [2005] NSWSC 1115, Brereton J looked at a number of authorities including of this Court and said:
Thus it is plainly not the question at this (first) stage whether the documents, production of which is sought, will definitely advance the case of the parties issuing the subpoena, nor whether they will be admissible in evidence at the trial. It is sufficient that they could “possibly throw light” on the issues in the substantive proceedings, or that it appears to be “on the cards” that they will do so. What are the issues in the proceedings will appear from the pleadings (where there are pleadings), the affidavits, and the legal principles which govern the claims for relief in the substantive proceedings.
In Martin (supra) at [29], Cronin J also referred to his decision in Papadopoulos & Papadopoulos (No. 2) [2007] FamCA 1683 where he observed:
49.The question of what is relevant takes on significance. The objective must be to assist the parties and the court in the determination of the issues in dispute. How does one determine that at an early stage? The issue was considered in the Victorian Supreme Court in Killorgan Investments Pty Ltd v Baycorp Advantage Business Information Services Limited and Ors where Byrne J said:
The degree of relevance for this purpose is not high: the inspecting party need only show a legitimate forensic purpose in the inspection. A party is entitled to inspect documents not only to see if they contain relevant facts, but also to see if they contain information which may be proved otherwise than through that document.
50.Accordingly, the bar is not set very high in respect to the question of relevance in a civil proceeding as between strangers. It should be less so in family law proceedings provided the pursuit of information is genuinely designed to assist in determining the issue and not for some illicit or harassing type of reason.
51.The onus in establishing the relevance lies on the person seeking the production of the documents either by way of subpoena or through discovery.
In terms of “fishing”, it is not legitimate for a party to issue a subpoena with a view to determining whether the issuing party has a case at all. In Unitingcare – Unifam Counselling & Mediation & Harkiss and Anor (2011) FLC 93-476 the Full Court at [69] referred to Hennessy v Wright (No. 2) (1888) 24 QBD 445 (reported as a note to Parnell v Walter & Anor (1890) 24 QBD 441) whereby the concept of a “fishing expedition” was described at 448 as occurring where:
…the plaintiff wishes to maintain his questions, and to insist upon answers to them, in order that he may find out something of which he knows nothing now, which might enable him to make a case of which he has no knowledge at present.
In deciding that a subpoena to a third party should be set aside in Ryder & Lee [2009] FamCA 531, Burr J adopted the following passage from the decision of Gray J in Andrew Garrett Wine Resorts & Anor v National Australia Bank Limited (No. 6) (2005) 92 SASR 419 where his Honour said at 428:
It is not enough for the party issuing the subpoena to raise a speculative possibility that the documents sought would assist the resolution of the dispute. The party supporting the subpoena must demonstrate that the documents sought in the subpoena are of real relevance to the issues in the case. It must be more than an outside chance that something useful might turn up in the documents. (Footnotes omitted)
In summary, it is not enough for a party issuing the subpoena to raise a speculative possibility that the documents sought would assist the resolution of the dispute. The party supporting the subpoena must demonstrate that the documents sought in the subpoena are of real relevance to the issues in the case. It must be more than an outside chance that something useful might turn up.
A subpoena that is tantamount to discovery is likely to be set aside as an abuse of process. As an extension of that principle, it is impermissible for a subpoena to be used to rectify inadequate discovery by a party to the proceedings. In Macks v Tucker & Ors & QBE Insurance (Australia) Ltd (No. 4) [2007] SASC 255, Bleby J said at [49] that in such a case:
It seems to me that the more appropriate course for the defendants to follow is to seek an order for further and better discovery from the plaintiffs, if they have a genuine concern about the adequacy of the plaintiff’s discovery and if they can point to reasons why that appears to be inadequate. …
DISCUSSION
Whilst it might be argued that the breadth of the documents sought in the subpoena is wide and therefore oppressive, the Department has not taken an objection and has produced documents in answer to the subpoena.
Mr Fazil complains that it is a breach of his privacy that the wife, to a lesser extent the husband and the Court should be privy to his private and personal dealings with the Department in support of the various visas granted and ultimately Australian citizenship.
As a general principle, if documents are relevant to an issue in the case, the consideration of the private affairs of a party or a stranger to the proceedings should be considered as a necessary casualty. Orders can be made that regulate the manner in which subpoenaed documents are treated.
It is apparent from the schedule that identifies the documents sought to be produced by the Department that there are some categories that relate to Mr Fazil’s assets and liabilities. In particular, 3(d), (e), (f) and 5(a), (b), (c) and (d) of the schedule have a financial focus.
At first instance, it is difficult to see the potential relevance of the other categories of documents as delineated in the schedule.
The manner in which the schedule has been drafted strongly suggests that it was done so in the hope that relevant documents might be caught in its net.
The issue is whether Mr Fazil would have been required to provide information to the Department in relation to his financial circumstances, in support of his visa and citizenship applications.
That consideration is the reason of the application by the husband and Mr Fazil to strike out paragraphs 9 and 14 of the wife’s affidavit. If successful, then there would be no basis to find that whilst there may be some uncertainty as to the nature of the documents pertaining to Mr Fazil’s financial circumstances, including his assets and liabilities, they nonetheless exist.
It is a reasonable assumption that it may be an important consideration as to whether when required to do so, Mr Fazil disclosed the extent of the husband’s indebtedness from time to time.
The difficulty for the wife is that her assertion that Mr Fazil would be obliged to disclose his assets and liabilities as part of the visa and citizenship applications is a bald assertion without any basis.
If the wife had presented evidence either by reference to legislation or other pertinent inquiry that Mr Fazil would have been obliged to disclose his financial circumstances, it could not be said that the documents sought do no more than raise a speculative possibility that the documents existed. Without more, it must be a fishing expedition based upon the opinion of the wife that on balance, the process for the issue of a subpoena and citizenship would have required financial disclosure by Mr Fazil.
VISA AND CITIZENSHIP REQUIREMENTS
The Migration Act 1958 (Cth) (“the Act”) together with the Migration Regulations 1994 (Cth) (“the Regulations”) govern the provision and regulation of visas in Australia. Both legislative instruments have been significantly amended over the years, especially the Regulations. Pursuant to s 499 of the Act, directions may also be given by the Minister to persons or bodies performing functions or exercising powers under the Act. Additionally, the Department produces a procedures advice manual known as “PAM3” which contains commentary in relation to the Act and Regulations for decision makers to follow.
The nature of the visas, the subject of application by Mr Fazil, is uncertain. Schedule “1” of the Regulations provides for the classes of visas available and details the application forms to be used, the visa application charge applicable and other relevant information as may be required.
It may be that Mr Fazil applied for a skilled migrant visa although that is not certain. Again, there are various visa classes in respect of a skilled migrant visa. Similarly, a consideration of Sch “1” of the Regulations in respect of a permanent residency visa for the period 1 July 2009 to 13 September 2009, reveals that there are approximately 39 classes of permanent visas available to non-residents with the sub-classes in Sch “2” of the Regulations running over three volumes.
Mr Fazil became an Australian citizen on 6 June 2012. The relevant legislation sets out the factors that may contribute to an applicant establishing that they have a close and continuing association with Australia which may include relevant financial information.
Additionally, the Department is able to ask Mr Fazil to provide information in respect of his finances.
At this stage, I do not consider that at the time this subpoena was issued the wife would have been in any position to know that Mr Fazil would have been required to disclose his financial circumstances as part of his visa and citizenship applications.
CONCLUSION
The issue of the subpoena to the Department must be considered as a fishing exercise and cannot be sustained.
I propose to order that the subpoena directed to the Proper Officer of the Department of Home Affairs issued 26 May 2021 be set aside.
Mr Fazil is not able to recall whether he was required to provide specific information as to his financial circumstances. He does not deny that such a request or obligation may have been made or occurred but rather that the elapse of time is such that he cannot now remember.
Implicit in these reasons is that documents that go to Mr Fazil’s financial circumstances during the course and currency of the purported loan with the husband would be relevant to an issue in the proceedings.
The difficulty for the wife is that a subpoena is not intended to be used as an alternative to third party discovery. To do so would be an abuse of process. For a subpoena to issue, it must be likely that relevant documents form part of the subpoenaed material.
Given that Mr Fazil does not know and cannot remember whether financial information was required in support of his visa and citizenship applications, the wife should be given an opportunity to better provide a basis to establish that relevant documents exist.
I propose to order that the documents produced by the Department, pursuant to the subpoena, remain in the registry for 28 days pending the filing of a further subpoena by the wife, in the absence of which the documents will be destroyed.
I make orders as appear at the commencement of these reasons.
I certify that the preceding fifty-five (55) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Berman. Associate:
Dated: 14 September 2021
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