Yeo v Sharma
[2013] FCCA 1946
•6 November 2013
FEDERAL CIRCUIT COURT OF AUSTRALIA
| YEO & ANOR v SHARMA & ANOR | [2013] FCCA 1946 |
| Catchwords: BANKRUPTCY – Further ruling on release of materials. |
| Legislation: Bankruptcy Act 1966, s.81 |
| Re AWB Limited (2008) VSC 473 |
| Applicants: | ANDREW REGINALD YEO AND GESS MICHAEL RAMBALDI IN THEIR CAPACITY AS TRUSTEES OF THE BANKRUPT ESTATE OF SAVADA NAND SHARMA |
| First Respondent: | SAVADA NAND SHARMA |
| Second Respondent: | RESHMI VEENA SHARMA |
| File Number: | MLG 1665 of 2012 |
| Judgment of: | Judge Burchardt |
| Hearing date: | 22 October 2013 |
| Date of Last Submission: | 22 October 2013 |
| Delivered at: | Melbourne |
| Delivered on: | 6 November 2013 |
REPRESENTATION
| Counsel for the Applicant: | Mr Fary |
| Solicitors for the Applicant: | Macpherson + Kelley Lawyers |
| The Respondents: | Mr Sharma appeared on behalf of the Respondents. |
THE COURT NOTES
On 5 June 2013 Judge Burchardt made Order 10 as follows:
“10. Pursuant to section 136 of the Evidence Act 1995, no material produced by Mr Sharma and or any oral evidence given in the oral examinations may be used in any other proceedings without leave of the Court.”
On 22 April 2013 the applicants gave the following undertaking to Registrar Allaway:
“Upon the applicants by their counsel undertaking in relation to the CD Rom produced by Savada Nand Sharma and marked “Copy Police vs Savada Sharma Defence Brief of Evidence” which is exhibit MFI 4 in this proceeding (“CD Rom”) that:
The CD Rom will only be examined by the applicants, their employees and legal advisors;
The material on the CD Rom will only be used by the applicants in performance of their duties under the Bankruptcy Act; and
The information on the CD Rom will not be provided to any third party unless directed or compelled by an order of the Court”
The applicants gave the following undertaking to Registrar Allaway on 23 July 2013:
“The Applicants, by their counsel, undertake to the Court, that they (including their employees and legal representatives) will not disclose to any third party such evidence given by Mr Sharma in the examination of Mr Sharma conducted pursuant to section 81 of the Bankruptcy Act 1966 over which Mr Sharma claims privilege against self incrimination, nor will they disclose to any third party any transcript of such evidence (“the privileged evidence”), without leave of the Court, unless directed or compelled to do so by the Court. The Applicants (including their employees and legal representatives) further undertake to only use the privileged evidence in the performance of their duties under the Bankruptcy Act 1966.”
THE COURT ORDERS
Notwithstanding Notation 1 above, the Applicants have leave to use material produced and evidence given in the oral examinations in this proceeding, in Family Court of Australia Proceeding No 6499/2011 under any restrictions or conditions as may be imposed by that Honourable Court in that proceeding.
Notwithstanding Notation 2 above, the undertaking set out in the Orders of Registrar Allaway made 22 April 2013 be varied so as to allow the use of the CD Rom in Family Court of Australia Proceeding No 6499/2011 under any restrictions or conditions as may be imposed by that Honourable Court in that proceeding.
Notwithstanding Notation 3 above, the undertaking given orally by Counsel for the Applicants on 23 July 2013, during the course of the Bankruptcy Examinations, be varied so as to allow the use of any evidence given by the first respondent in the Bankruptcy Examinations over which the first respondent claimed privilege against self-incrimination in Family Court of Australia Proceeding No 6499/2011 under any restrictions or conditions as may be imposed by that Honourable Court in that proceeding.
Save as provided in Orders 4, 5 and 6, the Order and undertakings referred to in Notation 1, 2 and 3 remain in full force and effect.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLG 1665 of 2012
| ANDREW REGINALD YEO AND GESS MICHAEL RAMBALDI IN THEIR CAPACITY AS TRUSTEES OF THE BANKRUPT ESTATE OF SAVADA NAND SHARMA |
Applicant
And
| SAVADA NAND SHARMA |
First Respondent
| RESHMI VEENA SHARMA |
Second Respondent
REASONS FOR JUDGMENT
(Revised from transcript)
To set this matter in its proper context, it is necessary to refer, at least in outline, to its history. On 21 December of last year, the trustee filed a summons. It sought orders under s.81 of the Bankruptcy Act 1966 (“the Act”), and in due course, subpoenas were issued and objections were taken to those subpoenas. It is sufficient for these purposes to record that on 22 April 2013, Registrar Allaway made various orders which effectively released materials, the subject of objection, including a CD Rom of the police brief in Mr Sharma’s criminal case.
On 23 April 2013 Mr Sharma sought review of the Registrar’s orders. Putting the matter slightly broadly, both the application and the affidavit in support asserted that the right to a fair trial would be compromised by the release of the police material. On 15 May 2013 the applicant filed a further affidavit. Relevantly, he deposed to being impecunious, and made various references to matters that are relevant. At paragraph 5 on page number 2, (as numbered in the top right-hand corner), he asserts:
“I will be compelled to disclose my defense in the Civil Proceedings which is on foot now. It is real and is happening now.” (sic)
Mr Sharma quoted authority in support of this proposition. He went on to say at paragraph 5 on page 3:
““Rather The court must consider whether there is a real danger of injustice if the defendant is required to reveal their criminal defence in the civil proceedings.” (sic)
That appears to be a quotation from a decision of Robson J in Re AWB Limited [2008] VSC 473.
On 2 and 16 May 2013 I conducted a hearing and on 31 May 2013 I gave reasons for decision; I will read what I said at paragraph 29 of that decision:
“So putting the matter shortly, I am going to release the material, subject to the orders or qualifications made by Registrar Allaway. I am not going to overturn the registrar’s decision in relation to Scammell Black Mileo, but I am going to order that nothing that is said in the oral examination can be used in any way in any other proceeding at all, subject to leave of the court. There may be good reason why leave should be given at some later point, but it certainly will not be before any criminal trial so there is no risk of any prejudice arising out of limited release of the materials.”
I ultimately made orders on 5 June 2013, which recorded undertakings by counsel for the applicants and otherwise dealt with the dissemination of the material that my decision dealt with. On 23 July 2013 Registrar Allaway made further orders, once again controlling the use of the material and setting orders in place for the oral examination of Mr Sharma. The use of the materials was restricted to the trustee’s performance of his duties, and I will read the undertaking given.
RECORDED: NOT TRANSCRIBED
The undertaking given by counsel on behalf of the trustee at that time was in the following terms:
“B. The applicants, by their counsel, undertake to the Court, that they (including their employees and legal representatives) will not disclose to any third party such evidence given by Mr Sharma in the examination of Mr Sharma conducted pursuant to section 81 of the Bankruptcy Act 1966 over which Mr Sharma claims privilege against self incrimination, nor will they disclose to any third party any transcript of such evidence (“the privileged evidence”), without leave of the Court, unless directed or compelled to do so by the Court. The applicants (including their employees and legal representatives) further undertake to only use the privileged evidence in the performance of their duties under by the Bankruptcy Act 1966.”
The matter, as I understand it, proceeded before Registrar Allaway, and the examination of both Mr Sharma, his wife and former solicitor finished by 1 August 2013. I note that the transcript of that oral examination is on the Court’s file, but I should make it clear that I have not felt it proper to read it.
On 20 September 2013 the trustee filed an application. In essence, it seeks to use the transcript of the oral examination in Family Court proceedings now brought by the trustee. This includes the proposed material over which Mr Sharma claimed privilege against self-incrimination. On 20 September 2013 the trustee’s affidavit was filed. I do not propose to refer to it in any detail. It explains the trustee is seeking an interest in the former matrimonial home of Mr and Mrs Sharma under s.79A of the Family Law Act 1975. I note that the issue of how Mr Sharma and his wife dealt with that property is now addressed by orders made by McMillan J in the Family Court.
On 21 October 2013 Mr Sharma filed another affidavit. I think in the circumstances, it is appropriate to read all the text out. It is under the heading “Grounds of objection to the APPLICATION FOR INTERIM ORDERS”. I will leave out the paragraph numbers, but they will be put in when we come to the editing of the judgment.
“1. Paragraph 10 of the order of Judge Burchardt made on 5th June and amended on 7th June not be varied as these orders were made by Justice Burchardt after due consideration to all factors and circumstances in my application to stop these proceedings running parallel to my criminal proceedings.
2. If the need to stop the proceedings were considered by his Honour as pre mature, then I say that the need to protect and safeguard my rights to privilege, against self incrimination, human rights - Refer to MOMCILOVIC V THE QUEEN (2011).
3. Your Honour in his wisdom said that my rights had been abrogated by sub section 11 of section 81 of the Bankruptcy Act 1966.
4. Such abrogation of my rights has to be balanced against section 32 of the Victorian Charter of Human Rights.
5. Your honour, your order of 7th June gives me some protection which will be nullified by your variation of your order. In respect of this, I wish to advise your Honour that:
· My committal was at the Melbourne Magistrates Court on the 8th Of October and the matter has been listed for mention at the County Court on the 26th November.
· As part of our negotiations I (with the assistance of my legal Representative made some concessions and agreed to assist the Police and the Prosecution with their inquiries.
· These discussions are at a very delicate stage and balance and any variation to your Honour’s protection by way of your order of 7th June will adversely impact on my ability to defend my criminal case at the County court and my discussions with the Police and Prosecution.
6. Mr Alan Marshall is my Lawyer handling my criminal case and we have not decided on a strategy as yet. A variation of your order will severely impact upon my ability to assist the Police and plead my Defence.
7. Your Order gives me albeit limited protection and any variation will be detrimental to my continuing criminal proceedings.
8. The trustee have to date spent more than $40,000 in the administration of my estate and conducted numerous examinations as stated in their affidavit. I will file my SOA by the commencement of this hearing to further assist the trustee in his endeavours.
9. I relied on your honour’s assurances to “safeguard my interests” when i answered all the questions put to me during the Oral examination.
10. I prefaced some answers with “privilege” again on your Honour’s assurance and Undertaking in writing sought by the REGISTRAR and assurances provided to me by the Registrar.
11. The Registrar was there at all times to ensure that all parties complied with the Law and procedure of the examinations. I did and now, the trustee wishes to renege on the undertaking by the trustee to only use the material as stated.
12. In hindsight, I would have chosen a different approach, had I known the intention of the trustee not to rely on it’s undertaking.
13. I sincerely believe i did compromise my criminal proceedings by answering all the questions at the oral examination, but I did so relying on your Honour’s protection and the undertaking given to me by the trustee in writing - THE SECOND UNDERTAKING.
14. The applicant in 5.2 of their affidavit states that “the Bankruptcy proceedings were commenced with a view of bringing proceedings under section 79A of the Family Law Act 1975” - This is contrary to THE SECOND UNDERTAKING. If this was the intention, then it was not specified to me and my responses may have been with this application in mind.
15. Your Honour, a variation of your order would leave me “high and dry” as i relied on your orders and the undertaking by the trustee.
16. In response to paragraph (8) of the applicant’s affidavit, I say:
I have filed my Statement of Affairs and the trustee has all the information to make it’s determination in the administration of my estate.
During the Oral Examination, i answered all the questions that they had about all aspects of the Debtor’s Investment Loan and Creditors and sale and proceeds of sale questions pertaining to my affairs.
17. These were done based on your order and the undertaking by the trustee.
18. The trustee has not examined the solicitors of the second respondent and in not doing so have failed to satisfy themselves of the integrity of the consent orders by the Registrar of The Family Court of Australia on 8th August 2011. MLC 6499/2011.
19. Your Honour, should you choose to vary the orders as sought by the trustee, It will impact on other parties as well and they have not been requested or invited to make submissions. The court orders prevent me from talking about this matter with the other examines of the Hearing conducted by the trustee as the Examinations have only been adjourned.
20. Your Honour, I submit that i have been misled by the trustee in giving me and the court an undertaking and then trying to use the information obtained by giving this undertaking.
21. Surely, they cannot have it both ways.
22. Your Honour I submit that in SHARMA V YEO & ANOR (2013) FCCA 444 - YOU HAD MADE IT ABUNDANTLY CLEAR in Paragraphs (23) (24) and (29) THAT “There may be good reason why leave should be given at some later point, but it certainly will not be before any criminal trial so there is no risk of any prejudice arising out of the limited release of the materials”
23. Sir, i do not want another certificate, I want to be able to address the County court matters without being prejudiced in my defence to the criminal proceedings.”
On 22 October 2013 the applicant has filed a Statement of Affairs. It is, in part, incomplete, but arguably that might not be Mr Sharma’s fault. I set out the law relevant to this matter in my earlier judgments and I refer to all of them. In particular, I refer to page 7, paragraphs (e) and (f); and page 8, paragraph (j), which I should probably read out to avoid being overly obscure. In considering matters relevant at page 7, paragraphs (e) and (f), I said:
“(e) The court’s task is one of “the balancing the justice between the parties”, taking account of all of the factors;
(f) Each case must be judged on its own merits, and it would be wrong and undesirable to attempt to define in the abstract what are relevant factors;”
Then page 8, at paragraph (j), I said:
(j) In this regard factors which may be relevant include:
(i)the possibility of publicity that might reach and influence jurors in the civil proceedings;
(ii) the proximity of the criminal hearing;
(iii)the possibility of miscarriage of justice eg by disclosure of a defence enabling the fabrication of evidence by prosecution witnesses, or interference with defence witnesses;
(iv)the burden on the defendant of preparing for both sets of proceedings concurrently;
(v)whether the defendant has already disclosed his defence to the allegations;
(vi)the conduct of the defendant, including his own prior invocation of civil process where it suited him;”
I turn now to the submissions of the parties. The trustee says that the property division entered into by Mr Sharma and his wife in 2011 should be set aside. The wife got the matrimonial home, and the husband got the debtor’s investment loan. The trustee says the loan is valueless, but needs the s.81 transcript, the CD-ROM and the other materials to prove this. It should be noted that the settlement in 2011 also gave the husband his accounting business, so the issue of property division may not be as simple as the trustee suggests.
Nonetheless, I accept the trustee’s position, (which can clearly be inferred from the evidence in the trustee’s affidavit filed on 20 September 2013), that the evidence the trustee seeks to rely on will, at the very least, be relevant to the trustee’s s.79A Family Law Act 1975 application. Indeed, this of itself has not been put expressly in issue by Mr Sharma.
Mr Sharma’s submissions relied on his latest affidavit which took the matter no further.
The following points might be relevant. First, the trustees already have the information. To the extent that the materials show Mr Sharma’s defence to the criminal case, the trustees already know it.
Secondly, the trustees cannot give this information to anyone else in any event, save, of course, McMillan J and anyone in her Court during the hearing, should there be one.
Third, it is clear there has been some change since the 31 May 2013 decision. Most particularly, the trustees may now seek to use this material before the criminal trial, something I then thought would not be the case. But provided its use is properly restricted, Mr Sharma will suffer no discernible prejudice.
Fourth, it is not clear at the moment what the timing of either the Family Law case or the criminal case is.
Fifth, there is some complexity in allowing the s.81 materials in before McMillan J. The s.81 materials involve the operation of s.81(11)(AA) of the Bankruptcy Act 1966, which expressly qualifies the common law rule against self-incrimination. Proceedings under s.79A of the Family Law Act 1975 do not prima facie involve the operation of s.81(11)(AA) of the Bankruptcy Act, but I note in passing that Mr Sharma was apparently able to – and did – take objection before the Registrar, in any event.
Sixth, Mr Sharma complains that the ground has shifted. He points to the fact that previous orders were made in the context of s.81, but now the matter may be considered under s.79A of the Family Law Act. He says he might have acted differently if he had understood how things were going to progress.
It should be noted that Mr Sharma never consented to any of the orders made. In fact, the trustees are still acting to pursue Bankruptcy Act obligations on his part. It is not possible for me to see that Mr Sharma could have acted in any other identifiable way than that in which he did.
Ultimately, it is a balancing matter. Firstly, I think that the trustee should be allowed to use the s.81 materials in the Family Law Act proceeding. Second, their use must be strictly limited to that proceeding and not given to third parties. Third, McMillan J is well able to protect Mr Sharma’s interest, to the extent that it may be necessary. I note that it is well open to Mr Sharma to make any further application to her Honour in the event that he is so advised, and particularly this would be the case if it were to turn out that it seems likely that the two trials might be at about the same time, or for any other valid reason.
Her Honour is well capable, in my respectful view, of dealing with these matters in an appropriate manner. I should emphasise that even that expression is unduly clumsy. Of course her Honour is able to deal with this matter properly. The fact is that the orderly administration of Mr Sharma’s estate is important, and the reality is that I see no risk of unfair prejudice to the conduct of Mr Sharma’s criminal trial in the course that I am proposing.
Mr Sharma’s most recent affidavit says that negotiations are underway with the prosecuting authorities, and are at a delicate stage. The fact is that the police already have the police brief. The trustees cannot give the police the s.81 materials that have arisen in the examinations before the Registrar. The matter is not imminently proceeding to trial in the Family Court, and is due for mention only on 15 November 2013. I propose to make the orders that the trustees seek, but in making those orders I will reaffirm the various restrictions and undertakings expressly again, to avoid any doubt and to safeguard Mr Sharma’s position. In saying that, of course, there may need to be some minor amendment, given that things have changed somewhat. That is a mechanical matter I will attend to in chambers.
I certify that the preceding twenty-four (24) paragraphs are a true copy of the reasons for judgment of Judge Burchardt.
Associate:
Date: 22 November 2013