Sebastian and Sebastian (No 5)

[2012] FamCA 709

FAMILY COURT OF AUSTRALIA

SEBASTIAN & SEBASTIAN (NO. 5) [2012] FamCA 709

FAMILY LAW – PRACTICE & PROCEDURE –  Leave to issue subpoena

Family Law Act 1975 (Cth)

APPLICANT: Ms Sebastian

RESPONDENT: Mr Sebastian

FILE NUMBER: MLC 6522 of 2010

DATE DELIVERED: 17 August 2012

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Young J

HEARING DATE: 17 August 2012

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Geddes QC with Ms Johns

SOLICITOR FOR THE APPLICANT: Taussig Cherrie Fildes

COUNSEL FOR THE RESPONDENT: Mr North SC with Mr Gates

SOLICITOR FOR THE RESPONDENT: Moores Legal

Orders

IT IS ORDERED:

1. THAT leave be granted to the wife and to her solicitors to forthwith issue a subpoena to produce documents to Court, such subpoena to be addressed to K Liquidators …, Melbourne.

2. THAT I direct that the service of that subpoena upon the proper officer of K Liquidators be effected as soon as practicable and in any event no later than 12.00 noon Monday 20 August 2012.

3. THAT any and all documents produced pursuant to the subpoena are to be lodged in a sealed envelope by the Registrar, Family Court, Melbourne Registry and delivered to the Court of Young J pending further order.

4. THAT no party, lawyer or person otherwise involved in or associated with these proceedings are to have contact with K Liquidators, save for the service of the subpoena upon their office, unless otherwise authorised and permitted by this Court.

5. THAT the extempore reasons for judgment be transcribed, be placed upon the Court file and be made available to the parties.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Sebastian & Sebastian has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 6522 of 2010

Ms Sebastian

Applicant

And

Mr Sebastian

Respondent

REASONS FOR JUDGMENT

1. On day five of this defended hearing of this matter and at a time when evidence in the section 79 proceedings has yet to be given and, indeed, the formal opening of the applicant’s case is yet to commence, I have an application before me made orally by Mr Geddes, Senior Counsel for the wife, that a subpoena be issued and be directed to the liquidators, K Liquidators, Melbourne, in respect of any file, document or record that they have and retain for the company, C Pty Ltd (in liquidation).

2. In the wife’s filed material she deposed to her knowledge of C Pty Ltd paragraphs 86 - 90 (inclusive).  She deposed in paragraph 89 that, to her knowledge, the shares in the company were sold and the proceeds and cash were distributed between the husband and his family members in 2007 when that entity was wound up.  Thus she was clearly aware of the winding up of that company at that relevant date. 

3. Today Mr Geddes has based his submission upon the fact that the wife, or her solicitors, did not know whom the liquidator was, as appointed, had not read any public notification of that appointment and had previously sought, via the husband or his father, various documents of and related to the financial position of  C Pty Ltd and its dealing with assets and/or its winding up. 

4. Mr North, Senior Counsel for the husband, addressed the court on the inappropriate timetable upon which the wife now seeks leave of the court to issue a subpoena.  He advised the court that his client had no particular concerns if such a subpoena was issued but highlighted the necessity for the court to evaluate if it was an inappropriate use of the court process. 

5. What is fundamental to the husband’s position in these proceedings, and which Mr North has reinforced, is that his client had made appropriate discovery as and when required of documents in his power, possession or control or those which are able to be produced. 

6. Very much the starting point in respect of the issue of C Pty Ltd is that the company was in liquidation.  There were liquidators formally appointed by law and it is those liquidators who had the financial and legal responsibility for the management and control of the company and its destiny.  What I have before me arising from submissions, or the reply thereto by each of the Senior Counsel, is that there was an application made by the liquidator to ASIC to de-register the company and to destroy the corporate documents and records held.  From what I am told from the bar table that application was made on or about 1 November 2007.  I am further informed by Senior Counsel for the husband – and he has offered to provide some form of documentation to the wife’s Senior Counsel, but the court has not seen that material – that on or about 8 March 2008 consent was given by ASIC to the destruction of documents then held. 

7. I refer to the Corporations Act and, in particular, section 542 thereof, which deals with issues of and related to opening “books of company” where a company is being wound up all books of the company and of the liquidator that are relevant to the affairs of the company are to be maintained.  The period that they shall be kept is five years, as provided for in sub-section (2) thereof, subject to the further matters dealt with therein.  Books may be destroyed in the case of a members or creditor’s voluntary winding up pursuant to the provisions of sub-section (3) and that records the consent of ASIC, which is required by subsection (4) thereof. 

8. Thus, it would appear that the liquidator has appropriately sought the consent of the corporate regulator and, seemingly on the material before me, it is not in issue that required consent was given in March of 2008.  That, therefore, is the background to the application now before the court on behalf of the wife for leave to issue a subpoena directed to the liquidator for production at court of any remaining or existing books of account, records, files or other documents of and related to C Pty Ltd. 

9. The leave of the court is required for the issuing of such a subpoena as these proceedings have commenced. I balance the interests of the parties and the outcome of this litigation, the need to determine a just and equitable division of property as is the fundamental requirement of section 79 of the Family Law Act 1975 (Cth), the timeliness of the application, the questions raised by Mr North, including the proper or, as he would perhaps highlight, inappropriate use of the court process at this late date. I am mindful of the timetable schedule for this case. I am mindful that the evidence is yet to be given and, with the number of witnesses, the matter will not conclude by Wednesday of next week, which is all the time available to the court at this particular stage of the hearing. That timetable has always been known. If the matter resumes, as is likely, it will be in late November 2012 and thereafter in the following calendar year. The husband will not be cross-examined, as will his father, until a later time.

10. All matters considered I see no real or substantial disadvantage to the court, its timetable or process and certainly not to the husband or his father a subpoena is now issued.  It may likely be that the documents have been destroyed.  What is fundamental to this application is that there is no evidence before the court that any such actual destruction of documents has occurred pursuant to the consent provided by ASIC.  In an alternative approach, Mr Geddes has otherwise called upon the legal practitioners for the husband for the production and any and all documents in the possession of the husband of and related to this corporate entity in liquidation and, indeed, extended the call to the witness, Dr G Sebastian, to produce all such documents.  Mr North has addressed the issue of the witness in his response to me and I accept his submissions.

11. The husband, of course, if he has documents is under an obligation to produce and, indeed, should already have produced any and all documents in his possession, so likely that request of him is somewhat futile because the court must proceed upon the basis, unless proved otherwise, that parties have given proper disclosure and discovery and have provided a full and frank production of all documents. 

12. At this stage I have no reason whatsoever to question anything to the contrary.  I intend to grant leave to issue a subpoena addressed to K Liquidators as the liquidators of the corporate entity C Pty Ltd.  The purpose of the subpoena will be to produce to this court, and not to any other person or entity, any and all documents, records, files, transactions and the like that they have retained, including the ASIC consent document and, therefore, any remaining document of and related to their administration of the liquidation of C Pty Ltd or documents of the corporate entity itself. 

13. It should not need not be said by the court, but to all parties – and I do not necessarily direct this to lawyers, but there should be no contact with K Liquidators by any person or individual prior to the company indicating whether they could co-operate with the subpoena.  If they have no documents they merely need to advise the court that they have no documents and that would be appropriate compliance.  Therefore, I require no contact by telephone, email or otherwise in person between any person of or associated with this case and the liquidator until their position is known and actioned. 

14. I, therefore, will grant leave to the wife’s solicitors to issue this day - and I will direct the court Registry – to issue a subpoena in proper form addressed to K Liquidators, Melbourne.  The requirement will be to produce all documents to this court on or before 10.00 a.m. next Wednesday morning, Wednesday being 22 August 2012, the documents to be produced to the Registrar and then to be delivered to this court in a sealed envelope and not to be made available to any party without further court order. 

15. I will have these extempore reasons for judgment transcribed, placed upon the court file, and all parties will be given a copy as soon as they are available.

I certify that the preceding fifteen (15) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Young delivered on 17 August 2012.

Associate: 

Date: