Zaki v Russells
[2019] FCCA 2236
•16 August 2019
FEDERAL CIRCUIT COURT OF AUSTRALIA
| ZAKI v RUSSELLS | [2019] FCCA 2236 |
| Catchwords: PRACTICE AND PROCEDURE – Subpoena – objection – whether legitimate forensic purpose. |
| Legislation: Fair Work Act 2009 (Cth), ss.44, 90, 117, 119, 323, 340, 361, 535 Federal Circuit Court Rules 2001 (Cth), rr.1.03, 15A |
| Cases cited: Alister v R [1984] HCA 85; (1984) 154 CLR 404 Andrade v Goodyear & Dunlop Tyre (Aust) Pty Ltd [2017] FCCA 497 SpencerMotors Pty Ltd v LNC Industries Ltd [1982] 2 NSWLR 921 Stanley & Anor v Layne Christensen Company & Ors [2004] WASCA 50 | ||
| Applicant: | MASIULLAH ZAKI | |
| Respondent: | RUSSELL LEGAL PTY LTD AS TRUSTEE FOR THE RUSSELL LEGAL TRUST AND TIPLADY LEGAL PTY LTD AS TRUSTEE FOR THE TIPLADY PRACTICE TRUST AND MCLEOD LEGAL PTY LTD AS TRUSTEE OF THE MCLEOD LEGAL TRUST AND CRAIG LEGAL PTY LTD AS TRUSTTE FOR THE BENNICK CRAIG FAMILY TRUST AND STUDACH LEGAL PTY LTD AS TRUSTEE FOR THE STUDACH TRUST AND ANDREW SUTHERLAND AND WJ LEGAL PTY LTD AS TRUSTEE FOR THE WJ LEGAL TRUST AND CAROLINE ELIZABETH SNOW AS TRUSTEE OF THE SNOW LEGAL TRUST, AND ESTJ HOLDINGS PTY LIMITED AS TRUSTEE FOR THE S&G FAMILY TRUST AND VIRGINIA JANE WATERHOUSE AS TRUSTEE OF THE WATERHOUSE HWL PRACTICE TRUST AND PAUL RICHARD MCCANN AND MATTIUSSI LEGAL PTY LTD, TRADING AS RUSSELLS ABN 38 332 782 534 |
| File Number: | SYG 2836 of 2017 |
| Judgment of: | Judge Barnes |
| Hearing date: | 17 September 2018 |
| Delivered at: | Sydney |
| Delivered on: | 16 August 2019 |
REPRESENTATION
| Counsel for the Applicant: | Mr Howell |
| Solicitors for the Applicant: | Michael Doherty Legal |
| Counsel for the Respondent: | Mr Darams |
| Solicitors for the Respondent: | Russells |
ORDERS
The following paragraphs or parts thereof in the subpoena issued to the Respondent on 30 October 2017 be set aside:
(i)the words “or Ms Kylie May” in paragraph 29;
(ii)paragraph 34;
(iii)the words “and 18” in paragraph 55;
(iv)paragraph 58;
(v)paragraph 59; and
(vi)paragraph 60.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 2836 of 2017
| MASIULLAH ZAKI |
Applicant
And
| RUSSELLS |
Respondent
REASONS FOR JUDGMENT
These Proceedings
The Applicant, Mr Zaki, is a solicitor who was employed by the Respondent, Russells (a firm of solicitors) between February 2014 and 17 May 2017 when he was summarily dismissed.
On 13 September 2017 Mr Zaki commenced proceedings under the Fair Work Act 2009 (Cth) (the FW Act) against Russells and 12 individual respondents who were said in the statement of claim to be partners of Russells at all material times.
On 30 October 2017 a subpoena for production was issued at Mr Zaki’s request directed to Russells seeking production of 62 categories of documents. After correspondence between the solicitors for the parties, on 8 March 2018 Russells filed a notice of objection to the subpoena. That objection is the subject of this judgment.
In the notice of objection Russells asserted that it was unable to consider the relevance of the documents sought as it was yet to be served with the final version of Mr Zaki’s claim and hence was not yet informed as to the issues at the heart of the claim. An amended statement of claim (ASOC) had been foreshadowed from at least the time of the first court date. Russells also contended that Mr Zaki could not simply seek to advance his claim by compelling it to produce “a broad array” of documents that may or may not be relevant to the proceedings. It was suggested that Mr Zaki should clarify what claim was intended to be pressed before any production was required. In the alternative, Russells contended in the notice of objection that the subpoena was oppressive and that numerous of the 62 paragraphs (which it identified) did not have a legitimate forensic purpose.
On 19 June 2018 Mr Zaki filed an ASOC which amended and elaborated on matters pleaded in the Statement of Claim and in which it was alleged that Russells contravened ss.44, 323 and 340 of the FW Act. On 3 July 2018 Mr Zaki discontinued the proceedings against the second to thirteenth respondents, leaving Russells as the only respondent.
It is now alleged that Russells contravened s.340 of the FW Act in circumstances where Mr Zaki’s employment was said to have been terminated for reasons that included: avoiding an obligation to pay him redundancy pay; preventing him from receiving redundancy pay under s.119 of the FW Act; and avoiding an obligation to give him notice or payment in lieu of notice under s.117 of the FW Act. He seeks penalties and compensation, including amounts for redundancy pay, payment in lieu of notice, loss of earnings and non-economic loss.
In addition, Russells is alleged to have contravened s.44 of the FW Act. This allegation relates to an asserted breach of s.90(2) of the FW Act in relation to Mr Zaki’s entitlement to be paid an amount in lieu of his accrued annual leave when his employment ended. The alleged contravention of s.323 of the FW Act relates to an asserted failure by Russells to pay Mr Zaki for work he performed and for personal leave in May 2017 on termination of his employment. In issue is a deduction (or withholding) by Russells from the amount paid to Mr Zaki after his employment was terminated. In its Defence to the ASOC, Russells alleges that this deduction was in respect of a debt owed to it which arose as a consequence of a study assistance advance to Mr Zaki.
It is also alleged that Russells breached Mr Zaki’s employment contract by failing to give him three months notice of termination of his employment. Russells denies this on the basis that Mr Zaki engaged in conduct that entitled it to terminate his employment contract without notice.
Background
Prior to his dismissal, Mr Zaki worked at Russells in a work team headed up by one of the then partners, Ms Wendy Jacobs (the ASOC refers to this team as “Team Jacobs”). It is alleged in paragraphs 24 to 25 of the ASOC that on or about 12 April 2017 members of Team Jacobs were advised at a meeting that Ms Jacobs and Russells had decided to part ways, that Team Jacobs would be disbanded on or before 30 June 2017 and that the members of the team would not be employed by Russells after 30 June 2017, although certain team members may stay on. Russells admits only that Ms Jacobs and the firm had decided to part ways and provides a different account of what was said at the meeting.
It is pleaded in paragraphs 27 to 28 of the ASOC that Mr Zaki was not offered any further or alternate employment with Russells at that time and that upon disbandment of Team Jacobs, his position within this team was no longer a job that Russells required to be performed by anyone. This is denied by Russells, except insofar as Mr Zaki remained an employee until 17 May 2017.
Paragraphs 29 to 34 of the ASOC plead events in relation to a firm file review said to have been conducted on 21 April 2017 in Mr Zaki’s absence (some aspects of which are denied or otherwise put in issue). It is also pleaded (paragraphs 37 to 40 of the ASOC) that in May 2017 Mr Zaki was informed by certain partners and staff of Russells that the equity partners were looking at terminating his employment. Mr Zaki pleads that he was told that emails and draft letters had been exchanged between the equity partners and the partner in charge of the Sydney office of Russells attempting to formulate a basis on which to terminate his employment. Russells has pleaded that it does not know and cannot admit these paragraphs in the ASOC.
Mr Zaki’s employment was said to have been “purportedly” terminated by email on 17 May 2017 because he “ducked” a file review process, had shown “gross discourtesy” that was “less than candid” in respect of this process and because he had been in persistent breach of the firm’s operation manual.
In the Defence Russells disputes some aspects of the pleading in relation to events of 17 May 2017. It refers to an exchange of emails. It admits most matters pleaded in relation to the termination letter, but asserts that it was valid and effective.
Mr Zaki denies that he engaged in any conduct that would have entitled Russells to summarily dismiss him (paragraph 63 of the ASOC). Russells disputes this for reasons elaborated on in paragraphs 63 and 64 of the Defence.
It is not in dispute that in the termination letter of 17 May 2017 Russells offered Mr Zaki a fixed term employment contract on substantially the same terms as his prior employment, except that it would terminate on 30 June 2017. Mr Zaki did not accept this offer.
Legal Principles
Each of the parties made written and oral submissions in relation to the notice of objection and the subpoena.
For the most part, the parties were in general agreement that the principles applicable to the determination of the issues before the court were as summarised in Russells’ pre-hearing submissions.
Thus, it was accepted that in response to the notice of objection Mr Zaki was required to identify the legitimate forensic purpose for which he required the documents the subject of the subpoena (see R v Tastan (1994) 75 A Crim R 498 at 504) and that this meant that he bore the onus of establishing that the documents sought had “apparent relevance” to the issues in the proceedings (see Re Trade Practices Commission v Arnotts Limited (1989) 88 ALR 90), being those issues arising on the pleadings (see McIlwain v Ramsey Food Packaging Pty Ltd [2005] FCA 1233; (2005) 221 ALR 785 at [35(e)] and Andrade v Goodyear & Dunlop Tyre (Aust) Pty Ltd [2017] FCCA 497 at [27]).
Other cases have used different terminology to essentially the same effect. Thus it has been said that the test of apparent or “adjectival” relevance referred to in Arnotts is whether, viewed realistically, the documents sought have a bearing on an issue which is not “unreal, fanciful or speculative” (R v Barton [1981] 2 NSWLR 414 at 420); that the material sought should be “reasonably likely to add, in the end, in some way or other, to the relevant evidence in the case” (SpencerMotors Pty Ltd v LNC Industries Ltd [1982] 2 NSWLR 921 at 927 and Dorajay Pty Ltd v Aristocrat Leisure Ltd [2005] FCA 588 at [17]); that the question is whether the material sought could reasonably be expected to “throw light” on some of the issues in the principal proceedings (McIlwain); or that it is “on the cards” that the documents sought will materially assist the party at whose request the subpoena was issued (Alister v R [1984] HCA 85; (1984) 154 CLR 404 at 414 and see generally Wong v Sklavos; Satchell v Sklavos [2014] FCAFC 120; (2014) 319 ALR 378 at [12]).
The parties acknowledged that subpoenas “may be used to obtain documents relevant only to questions of credit, for the purpose of assisting cross-examination as to credit” (Liristis v Gadelrabb [2009] NSWSC 441).
Further, a subpoena may be used at an early stage in proceedings (for example where, as here, little or no substantive evidence has been filed). In such circumstances the following principles adopted by the Western Australian Court of Appeal in Stanley & Anor v Layne Christensen Company & Ors [2004] WASCA 50 at [9], as referred to in Andrade at [25], are in point:
(1) A legitimate forensic purpose will be established if a document gives rise to a line of enquiry which is relevant to the issues before the trier of fact, including for the purpose of meeting the opposing case by way of cross-examination: see Apache Northwest Pty Ltd & Ors v Western Power Corporation (1998) 19 WAR 350 at 374; National Employers' Mutual General Insurance Association Ltd v Waind & Anor [1978] 1 NSWLR 372 at 385; Maronis Holdings Ltd & Ors v Nippon Credit Australia Ltd & Ors [2000] NSWSC 138; (2000) 18 ACLC 609 at 613 – 614.
(2) In assessing whether a legitimate forensic purpose exists in relation to documents sought on an early return of subpoena, it must be borne in mind that the necessity for having a document to fairly dispose of the issues at trial might well not become apparent before trial. It may, for example, become apparent when a document is used in cross-examination to refute unforeseen evidence-in-chief. Thus, whether a document is 'necessary' to fairly dispose of proceedings is to be understood in the broad sense of embracing any document which has value, in the sense of at least apparent relevance, and fairly disposing of proceedings, even if it might not readily be seen, at the pre-inspection stage, necessarily to be admissible in evidence: see Apache Northwest (supra) at 376. Cases will be rare in which, prior to production of documents, a subpoena will be set aside as an abuse of process on the ground the documents by description are manifestly irrelevant to the subject proceedings, or are incapable of bearing upon matters of credit pertinent to the proceedings: see Brand v Digi-Tech [2001] NSWSC 425.
(3) At least one object of the rule permitting early return of subpoenas is to appraise the parties of the strengths and weaknesses of their case at an early stage. Hence, no narrow view as to the legitimate purposes of a subpoena ought to be taken: see Khanna v Lovell White Durrant [1995] 1 WLR 121 at 123.
(4) There is no requirement that to avoid the stigma of fishing, a party must already by in possession of some evidence before issuing a subpoena. Historically the concept of fishing was not concerned with the prior possession of evidence, but rather the prior pleading of issues for which the evidence sought would be relevant: see Bailey & Ors v Beagle Management Pty Ltd & Ors [2001] FCA 60; (2001) 105 FCR 136 at 143 – 144; Chapman v Luminis Pty Ltd [2001] FCA 1580 at [48]. In the interests of a fair trial, litigation should be conducted on the footing that all relevant documentary evidence is available: see Bailey (supra) at 143.
Mr Zaki did not accept as a general principle that the burden of production of the documents must not be disproportionate to their relevance as Russells contended (see Arnotts and also Dorajay at [34]), but did accept that a subpoena may be set aside if it was “oppressive” in the sense that the issue of the subpoena must not, in all the circumstances, be oppressive in terms of its impact on the recipient (McIlwain at [35(m)]).
In Dorajay at [34] Stone J considered the relevance of proportionality as follows:
… This amounts to a submission that the paragraphs have no legitimate forensic purpose because the documents are sought in order to discover if there is a case not to support a case that has already been articulated; Small at 575. In Bailey v Beagle Management Pty Ltd [2001] FCA 60; (2001) 105 FCR 136 at 143, a Full Court of this Court noted that the concept of fishing had undergone ‘substantial rethinking’ in recent years. The Court referred to the comment of the majority of the High Court in Grant v Downs [1976] HCA 63; (1976) 135 CLR 674 at 685 to the effect that the public interest requires that in the interests of a fair trial ‘all relevant documentary evidence’ should be available. The Full Court commented at 143:
The applicants’ suggested rule imposes a requirement that, to avoid the stigma of fishing, a party must already be in possession of some evidence, before issuing a notice to produce (or, presumably, any other compulsive interlocutory process). But historically the concept of fishing was not concerned with the prior possession of evidence but rather that there was a prior pleading which raised issues for which the evidence sought by the process would be relevant.
Their Honours noted at 144 that, more often, a holding on fishing in relation to an interlocutory process ‘appears to be more a question of oppression’. They referred to the comments of Jordan CJ in Small at 575 that a subpoena ‘will be set aside as abusive if great numbers of documents are called for and it appears that they are not sufficiently relevant’. Even if I am wrong in relation to the documents referred to in [33] above not being relevant to the s 33N hearing, I would set aside the subpoenas to the extent that they refer to those documents on the ground that such relevance as they may have is disproportional to any benefit that their production might have for the respondent.
In Arnotts Beaumont J pointed out (at 102) that it was relevant to consider whether a subpoena was “seriously and unfairly burdensome or prejudicial”, looking at the matter from the point of view of the party subpoenaed. The difference of opinion between the parties in relation to the relevance of proportionality may well have been of considerable significance had Mr Zaki continued to press for production of all 62 categories of documents listed in the subpoena. However, as discussed below, that is no longer the case.
In Gloucester Shire Council v Fitch Ratings, Inc [2016] FCA 587 Wigney J clarified at [23] that:
The common theme of these various statements of the applicable test of relevance in the context of subpoenas or notices to produce is that it is less stringent than the test of relevance that applies in the context of the admissibility of evidence. And where, as here, the proceeding is at a very early stage and the issues have not been clearly defined, the question whether documents sought by a subpoena have apparent relevance should not be approached too narrowly or rigidly. In such circumstances, the court should be wary of too readily excluding the possibility that a document or class of documents might at the end of the day be relevant to a fact in issue in the litigation. The court should not lose sight of the fact that the public interest requires that in the interests of a fair trial litigation should be conducted on the footing that all relevant documentary evidence is available: Grant v Downs [1976] HCA 63; (1976) 135 CLR 674 at 685; referred to by the Full Court in Bailey v Beagle Management Pty Ltd [2001] FCA 60; (2001) 105 FCR 136 at 143 [27].
Further, insofar as there is an assertion that a subpoena is being used to discover if the issuing party has a case, rather than to support a case already articulated, Brereton J observed in Liristis v Gadelrabb at [5] that: “It is not fishing to seek documents when there are reasonable grounds to think that fish of the relevant type are in the pond”. However, the documents of which production is sought must be identified with reasonable particularity and a subpoena cannot be used as a substitute for discovery (Commissioner for Railways v Small (1938) SR (NSW) 564, 574-575 per Jordan CJ; NSW Commissioner of Police v Tuxford & Ors [2002] NSWCA 139 at [19]). Further, a subpoena should be set aside as an abuse of process if it is unintelligible in form (Marsden v Amalgamated Television Services Pty Ltd [1999] NSWSC 619 at [461]; Deputy Commissioner of Taxation v Caporale [2014] FCCA 250 at [39(e)] per Lloyd-Jones FM).
The Scope of the Subpoena
There were originally 62 paragraphs in the subpoena. However some time after the notice of objection was filed and after correspondence between the parties, the solicitors for Mr Zaki informed the solicitors for Russells that he pressed only paragraphs 10, 29, 34, 37, 51-55, and 57-62 of the subpoena.
Counsel for Mr Zaki also stated in written and oral submissions that paragraph 53 of the subpoena was not pressed. Further, after Russells conceded in pre-hearing submissions that if the requisite conduct money was paid (see r.15A of the Federal Circuit Court Rules 2001 (Cth)) it would be prepared to produce documents in answer to paragraphs 57, 61 and 62, Mr Zaki paid conduct money of $25 and accordingly paragraphs 57, 61 and 62 are no longer in dispute.
In addition, in the course of the hearing, after counsel for Mr Zaki clarified the scope of the documents sought under paragraph 10 of the subpoena, counsel for Russells confirmed that the objection to paragraph 10 (as explained in submissions) was not maintained.
These concessions leave in issue paragraphs 29, 34, 37, 51, 52, 54, 55, 58, 59 and 60 of the subpoena.
In pre-hearing written submissions Russells pointed to the fact that various disputed paragraphs in the subpoena (which was issued before Mr Zaki filed the ASOC or the notice of discontinuance in relation to the second to thirteenth respondents to these proceedings) contained references to the “Respondents”, despite the fact that, at least from the time the ASOC was filed, there had been only one respondent. The submission continued:
The members of the partnership that is the Respondent are not prepared to make a general assumption as to whom Zaki is referring to when he says “Respondents” (Affidavit of Andrew Paul Tennent Sutherland sworn 17 August 2018). They are not required to. Nor should they have to.
It is simply not possible for the Respondent to understand what correspondence and communication is sought given that there is no longer more than one Respondent. The maintenance of the paragraphs in the current form renders them unintelligible and amounts to an abuse of process and should be set aside on that basis alone (see paragraph 12.g above).
However, on the basis that the reference to the “Respondents” in the subpoena may be taken to mean each and every person identified as the “Respondents” in the definitions in the Schedules to the subpoena, Russells also made submissions in the alternative about the extent to which paragraphs of the subpoena met the test of apparent relevance or were oppressive.
As counsel for Mr Zaki pointed out, and as acknowledged for Russells, Schedule 1 to the subpoena identifies the term “Respondents” to mean Russells “and the parties listed in Schedule 2”. In turn, Schedule 2 lists the persons who were originally named as the second to thirteenth respondents in the substantive proceedings.
In these circumstances I am not persuaded that the reference to “Respondents” in various paragraphs of the subpoena is such as to render those paragraphs unintelligible, whether considered objectively or from the perspective of the firm of solicitors that is now the only respondent to the substantive proceedings. Nor am I satisfied that any part of the subpoena should be set aside as an abuse of process on this basis alone. I note that it does not appear to be in dispute that the persons named in Schedule 2 to the subpoena have been referred to and held out as partners in Russells (albeit in some instances the partners were corporate trustees) (see p.532 in Annexure APTS-1 to the affidavit of Andrew Paul Tennent Sutherland sworn on 24 May 2018 and relied on by Russells). For convenience those individuals are referred to below as the partners.
In addition to Mr Sutherland’s affidavit of 24 May 2018, Russells relied on a second affidavit of Mr Sutherland sworn on 17 August 2018 and Mr Zaki relied on his affidavit sworn on 7 August 2018 in relation to the notice of objection.
Paragraph 10
Paragraph 10 of the subpoena is as follows:
All documents evidencing or recording any employee file or record maintained by any of the Respondents (or by any person or entity acting on behalf of any of the Respondents, jointly, severally or otherwise) in respect of the Applicant from 1 November 2013 to 1 July 2017, including but not limited to:
a. records of the Applicant’s accrued personal and annual leave;
b. records of the Applicant’s personal and annual leave history;
c. the Applicant’s performance reviews;
d. records or documents evidencing any promotion sought by, or granted to, the Applicant and any deliberation or consideration of any such promotion by any of the Respondents or any other persons or entities acting on their behalf;
e. letters or documents confirming the Applicant’s promotion;
f. the applicant’s file reviews including any file review memos;
g. letters to the Applicant post any periodic performance reviews;
h. records of any performance management process, disciplinary action, cautioning, counselling or warning of the Applicant;
i. records of the Applicant’s financial performance in the period between February 2014 and June 2017; or
j. any other document or record of any information pertaining to the Applicant’s employment terms, entitlements or performance.
In oral submissions counsel for Mr Zaki clarified and narrowed the intended scope of this paragraph. It was explained that what was sought was a copy of any personnel file maintained by Russells with respect to Mr Zaki and any such file maintained by an individual partner, as well as the employee records in respect of Mr Zaki required to be made and kept under s.535 of the FW Act. Counsel for Russells confirmed that there was no objection to the production of such documents.
Paragraphs 29 and 34
Paragraph 29 of the subpoena appears under the heading “Wendy Jacobs’ Team”. It seeks production of the following:
All documents evidencing or recording communications made between 1 December 2016 to 1 July 2017 between any of the Respondents and Ms Andrea Kilgariff, Mr Graeme McFadyen, Mr Kevin Johnston, Mr Alan Rich or Ms Kylie May and visa-versa about the disbanding or departure of Wendy Jacobs’ Team on or about 30 June 2017.
Paragraph 34 of the subpoena is also under the hearing “Wendy Jacobs’ Team”. It is as follows:
All documents evidencing or recording any offer of further, continued or alternate employment made by or intended to be made by, or on behalf of, any of the Respondents between 1 December 2016 to 1 July 2017 to any of;
i. the thirteenth respondent;
ii. Mr Andrew Bobb; or
iii. Ms Cheryl West.
First, as indicated above, insofar as these paragraphs refer to “Respondents” it is clear that this is intended to be a reference to the “Respondents” as specifically defined in the Schedules to the subpoena and encompasses the firm Russells and the 12 individuals named in Schedule 2 to the subpoena who, it appears, were partners of the firm for at least some of the period of 1 December 2016 to 1 July 2017.
In written submissions Mr Zaki indicated in relation to paragraph 29 that he now only pressed for production of documents evidencing or recording communication “between three of the five persons individually named” in that paragraph. However in oral submissions it was clarified that what was sought were communications between any of the “Respondents” and any of Ms Andrea Kilgariff, Russells’ chief operations officer (COO) and general office manager; Mr Kevin Johnston, Russells’ chief financial officer (CFO); or Ms Kylie May, the administrative assistant to the managing partner (Mr Russell), an equity partner (Mr Sutherland) and the partner in charge of the Sydney office (Mr McCann), about the disbanding or departure of Team Jacobs.
Mr Zaki submitted that:
Broadly stated, the documents captured by paragraphs 29 and 34 of the Subpoena are directly relevant to:
- the circumstances surrounding the disbanding of Team Jacobs and the timing of the same;
- the potential retention of some members of Team Jacobs; and
- The effect of Team Jacobs being disbanded vis-à-vis the employment and entitlements of the members of that team including the Applicant.
Mr Zaki contended that it was clear that these issues were in dispute (see paragraphs 24 to 26 and 54 to 55 of the ASOC and the Defence).
In particular, Mr Zaki pointed out that in the ASOC he made an allegation (that Russells denied) that in a meeting in April 2017 he was told that upon the disbanding of Team Jacobs, he and other members of the team would not be employed by Russells (ASOC and Defence paragraph 25); that his job was no longer a job required of anyone (ASOC and Defence paragraph 28); and that had his employment been terminated by Russells after the disbanding of Team Jacobs he would have been entitled to redundancy pay (ASOC and Defence paragraph 60).
Mr Zaki argued that it was highly likely that each of Ms Kilgariff, Mr Johnston and Ms May was involved in communications surrounding the disbanding and what was planned with respect to the members of Team Jacobs. In oral submissions counsel for Mr Zaki indicated that he did not press paragraph 29 in relation to communications about the circumstances of Ms Jacobs.
Mr Zaki also relied on what was said to be an assertion in paragraph 26 of the ASOC that the three other members of Team Jacobs named in paragraph 34 of the subpoena (including Mr Mattiussi who was previously the thirteenth respondent to the substantive proceedings) had been offered further, continuing or alternate employment with Russells following the April 2017 meeting. In fact paragraph 26 of the ASOC pleads that “various members of Team Jacobs including but not limited to” the three persons named had been offered employment. It was pointed out that paragraph 26 in the ASOC was denied by Russells and hence put in dispute (Defence paragraph 26). What happened to other Team Jacobs members in this respect was said to be directly relevant to issues arising on the pleadings.
In essence, Mr Zaki submitted that communications within the period identified in paragraph 29 of the subpoena between partners of the firm and any of the COO, CFO and/or the administrative assistant to the managing partner and the partner in charge of the office where Team Jacobs was based, about the disbanding or departure of Team Jacobs on or about 30 June 2017 and documents in relation to any actual or intended offer of employment to the other Team Jacobs members referred to in paragraph 34 of the subpoena, would be “reasonably likely to add, in the end, in some way or other, to the relevant evidence in the case” (see Spencer at 927 and Dorajay at [17]) and could reasonably be expected to “throw light” on some of the issue in the principal proceedings including, for example, what Russells was intending to do with the members of the team following disbanding of the insolvency team. There was said to be a legitimate forensic purpose for these documents based on this issue alone.
Russells submitted that the documents sought were not sought for a legitimate forensic purpose. Insofar as paragraph 29 of the subpoena referred to documents evidencing or recording communications about the disbanding or departure of a former partner’s team, it was pointed out that there was no dispute that Mr Zaki was a member of Ms Jacobs’ team or that she and Russells had decided to part ways. Nor was the fact of the termination of Mr Zaki’s employment by letter of 17 May 2017 signed by Mr McCann in dispute. It was submitted that insofar as Mr Zaki contended that if his employment had not been terminated on 17 May 2017 then it was “most likely” that he would have been made redundant, this was denied by Russells, which asserted that the reasons for termination were those addressed in the termination letter. In any event it was contended none of the documents that might fall within paragraph 29 of the subpoena met the test of apparent relevance in that respect.
Russells submitted that paragraph 34 of the subpoena should be set aside on the basis that none of the documents sought met the test of apparent relevance. It was submitted that whether or not other persons were offered further, continued or alternate employment could have no bearing on the reasons for Mr Zaki’s termination.
Insofar as in oral submissions counsel for Russells contended that, as formulated, paragraph 29 of the subpoena would capture many matters outside the issues in dispute between the parties, including correspondence in relation to the circumstances of Ms Jacobs herself which was not relevant to the litigation, as indicated, Mr Zaki no longer seeks production of correspondence in relation to the circumstances of Ms Jacobs.
Russells also submitted that insofar as Mr Zaki contended that matters referred to in paragraphs 24 to 28 of the ASOC were in dispute, paragraph 24 (about the fact of a meeting on or about 12 April 2017 and the participants) was admitted. It was acknowledged that what was said at that meeting by Ms Jacobs and Mr McCann was in dispute and that Russells had pleaded that Ms Jacobs spoke words to the effect of the matters set out in an email of 12 April 2017 to Mr Rich (a member of Russells’ advisory board) which was tendered. However, counsel for Russells contended that what would be relevant would be evidence of what was said and the notes of conversations or records of those who were present at that meeting as to what was said on that occasion. Indeed, it was conceded that if paragraph 29 of the subpoena was limited to correspondence about what was said at the 12 April 2017 meeting, then that might be relevant to the real issues in dispute. However it was submitted that, as drafted, paragraph 29 was not limited to the meeting or to the circumstances of Mr Zaki and was too broad.
Counsel for Russells acknowledged that issue appeared to be joined in the proceedings in relation to the matters referred to in paragraph 34 of the subpoena, but submitted that whether or not those other individuals were offered further, continued or alternate employment was not a real issue in dispute in the proceedings, because it was not alleged that because those people were, or were not, offered such employment that meant that Mr Zaki was targeted for termination by Russells.
As counsel for Mr Zaki pointed out in reply, in addition to the pleading in relation to what occurred at the meeting of 12 April 2017, he also relied on the pleading in paragraph 26 of the ASOC that other employees of Russells who were in Team Jacobs were offered further or alternative employment opportunities with Russells, which Russells denied; that he was not given such an offer prior to his termination (ASOC paragraph 27), which Russells denied; and that upon disbandment of Team Jacobs, Mr Zaki’s position job as a senior associate in Team Jacobs with Russells was no longer a job it required to be performed by anyone (ASOC paragraph 28), which Russells denied. Further, in relation to the disbanding of Team Jacobs, it was pointed out for Mr Zaki that the departure of other named team members (including those mentioned in paragraph 34 of the subpoena) was pleaded in paragraph 54(b) of the ASOC, but denied by Russells; as was Mr Zaki’s claim (in paragraph 55 of the ASOC) that as at 7 July 2017 if Russells had not summarily dismissed him on 17 May 2017 his employment “would likely have come to an end at the initiative of the respondent in circumstances entitling [him] to severance pay under s 119 of the FW Act.”
It is relevant for the purposes of s.361 of the FW Act to consider the context in which the pleaded and disputed events occurred to assess the reliability of the asserted reasons for the dismissal of Mr Zaki. Communications between the partners in Russells and senior management would be reasonable likely to add, in one way or another, to the relevant evidence in the case, in particular as to the intentions of the partners in Russells (the decision-makers) in relation to employees who were members of Team Jacobs.
I have borne in mind that the concept of apparent relevance should not be approached too narrowly in relation to a subpoena issued at an early stage in proceedings. I am satisfied that (excluding documents evidencing or regarding communication about Ms Jacobs’ circumstances upon the disbanding or departure of her team) communications in relation to the disbanding of Team Jacobs and the departure of team members, between any of the partners and the COO or the CFO of Russells, could reasonably be expected to “throw light” on matters in issue in the principal proceedings, in particular what was to happen in relation to the employees in Team Jacobs and the reasons for the termination of Mr Zaki’s employment. At this early stage in the proceedings, I am not persuaded that only correspondence about what was said at the meeting of 12 April 2017 would be of apparent relevance.
Further, the parties acknowledge that production of documents relating only to credit of decision-makers may be for a legitimate forensic purpose, having regard to the reverse onus on the Respondent under s.361 of the FW Act in relation to its reason for dismissing Mr Zaki. In this context it is not unreasonable to think that the reasoning process of the decision-makers may have involved an assessment which included other persons whose views may have had a direct and material effect on the decision to dismiss Mr Zaki. Correspondence to or from such persons may throw some light on such reasons. Indeed, the reasoning process of persons who were not decision-makers, but who had a material effect on the ultimate outcome may itself be of potential relevance (see Board of BendigoRegional Institute of Technical and Further Education v Barclay [2012] HCA 32; (2012) 248 CLR 500 and the discussion in Construction, Forestry, Mining and Energy Union v Clermont Coal Pty Limited [2015] FCA 1014 at [120]-[121]). The views of or communicated to senior management (such as the COO and CFO) are hence of apparent relevance. While bearing in mind the need for caution where a subpoena is sought to be justified on the basis of credit, in this case the particular credit issue (relevant to the reverse onus in s.361 of the FW Act) is capable of reasonable articulation. Making due allowance for the early stage of proceedings, the connection between the documents sought in this respect and that issue is apparent (see generally Thomas v SMP (International) Pty Ltd (No.2) [2010] NSWSC 870 at [19]).
However Mr Zaki has not established a legitimate forensic purpose for seeking communications between any of the Respondents and persons other than senior management, such as an administrative assistant to some of the partners.
On this basis and having regard to the concessions that documents in relation to Ms Jacobs’ circumstances and communications to or from Mr McFadyen and Mr Rich are not sought, only the words “or Ms Kylie May” in paragraph 29 of the subpoena should be set aside.
While issue is joined in relation to paragraph 26 of the ASOC, that paragraph refers to offers of employment to “various members of Team Jacobs, including but not limited to” the three persons named in paragraph 34 of the subpoena. It has not been demonstrated that documents evidencing particular offers of employment made or intended to be made to some members of Team Jacobs would be likely to throw light on Mr Zaki’s claim that his position was no longer a job that Russells required to be performed by anyone or, more generally, on the reasons for his dismissal, beyond what may be revealed by documents produced in response to paragraph 29 of the subpoena. I am not satisfied that Mr Zaki has established that there is a legitimate forensic purpose in seeking the documents referred to in paragraph 34 of the subpoena. It should be set aside.
Paragraph 37
Under the heading “Applicant’s whereabouts on 21 April 2017”, paragraph 37 of the subpoena is as follows:
All documents evidencing or recording communications sent or received by the Applicant from the email address [email protected] during the period from 1 April 2017 to 31 May 2017 about the applicant’s whereabouts on 21 April 2017.
Mr Zaki contended that the documents captured by paragraph 37 were limited and were directly relevant to his “whereabouts” on 21 April 2017. He claimed that Russells had made a number of allegations against him, including as to his whereabouts on 21 April 2017 and his motivations in that respect, and also about his availability and the availability of other staff to conduct the file review at some other time (see paragraphs 29, 31 and 64 of the Defence).
It was explained that Mr Zaki did not have access to all the emails he sent and/or received on 21 April 2017, as these documents are in the control of Russells. Mr Zaki submitted that the documents sought under paragraph 37 of the subpoena would be “reasonably likely to add, in the end, in some way or other, to the relevant evidence in the case” (see Spencer at 927 and Dorajay at [17]), and could reasonably be expected to “throw light” on some of the issues of the principal proceedings.
Russells contended that the documents sought in this paragraph were not sought for a legitimate forensic purpose, because the test of apparent relevance was not satisfied. Russells submitted that there was no issue in the proceedings in relation to Mr Zaki’s “whereabouts” on 21 April 2017. It was also submitted that the only issue in the pleadings in relation to an email Mr Zaki sent to Mr McCann on 21 April 2017 concerned the content of that email. It was pointed out that the fact of the sending and receipt of this email was not in issue (Defence at [29(b), (c), (g)]). To the extent that there is an issue in the proceedings about that email, Russells observed that Mr Zaki could but had not done so.
Neither party addressed paragraph 37 in oral submissions.
The Defence clearly put in issue the circumstances in which Mr Zaki failed to attend a file review meeting on 21 April 2017 and, in that context, his “whereabouts” on that date. The termination letter referred to the Applicant “ducking” the file review scheduled for 21 April 2017 and Mr Zaki’s conduct that day was characterised as a “gross discourtesy” that was “less than candid” (Defence paragraph 45). While Mr Zaki could utilise the notice to produce procedure in relation to any pleaded email, the parties are at odds over the identity of the person or persons to whom a relevant email was sent that day and the time at which it was sent (ASOC and Defence paragraph 29).
In any event, I am satisfied that emails from April and May 2017 to and from Mr Zaki’s Russells email address about his whereabouts on 21 April 2017 could reasonably be expected to throw some light on matters in issue in these proceedings. In that respect I note that, in addition to the reference to Mr Zaki “ducking” the meeting in the termination letter, Russells asserts in the Defence (paragraph 64) that Mr Zaki failed to follow a reasonable and lawful direction to attend the scheduled file review on 21 April 2017. This is one of the pleaded aspects of the conduct of Mr Zaki that is said to have “entitled” Russells to terminate Mr Zaki’s employment without notice. In addition, paragraph 64 of the Defence also pleads other matters about Mr Zaki’s whereabouts on 21 April 2017. It is alleged that his presence in a personal meeting with another firm of solicitors was the reason or one of the reasons he missed the file review and that this had not been properly disclosed by him. Russells pleads that it became aware of this issue after the termination of Mr Zaki’s employment, but that it would be a “complete answer” to Mr Zaki’s claims in the proceedings. Hence the circumstances in which Mr Zaki failed to attend the file review of 21 April 2017 are of relevance to both the adverse action and breach of contract claims (see ASOC paragraphs 29 to 36 and 45(a) and (b) and Defence paragraphs 29 to 36 and 45(b) and (c)).
In these circumstances, I am satisfied that there is a legitimate forensic purpose in seeking production in response to the subpoena of this limited category of documents relating to Mr Zaki’s whereabouts on 21 April 2017. Such documents have apparent relevance to matters in issue in the proceedings. This paragraph should not be set aside.
Paragraph 51
Under the heading “Termination of the Applicant’s Employment Contract”, paragraph 51 seeks:
All documents evidencing or recording communications made between 12 April 2017 and 17 May 2017 between any of the Respondents about terminating the Applicant’s employment.
Russells contended that this paragraph called for documents that did not serve a legitimate forensic purpose. There was said to be no issue about the fact that Mr Zaki’s employment was terminated by Russells and contended that to the extent that there were issues, they were limited to the reasons for that decision which, it was suggested, would be of the salient decision-makers and given by way of evidence (see Barclay at [43] - [45], [127] and [146]). Russells contended that paragraph 51 of the subpoena related to the “process” adopted when Mr Zaki’s employment was terminated and was not directed to the reason(s) of the decision-makers.
Mr Zaki pressed for production of this category of documents. He submitted that the documents sought in this category were of a narrow compass, limited by subject matter, time and author/recipient.
It was pointed out that the termination letter stated that the “overwhelming majority” of partners had come to the view that they wished the Applicant to “leave our employment immediately”. In answer to a request for further and better particulars, Russells had confirmed that this meant all the partners except for Ms Jacobs and Mr Mattiussi.
On this basis Mr Zaki submitted that the decision-makers for the purpose of these proceedings were each of the partners, except for Ms Jacobs and Mr Mattiussi. In any event, it was pointed out that it was not in dispute that each of the partners acted as agents for the others and that the actions of each of the members of the partnership bound each member of the partnership (and see ASOC and Defence paragraph 3).
Mr Zaki submitted that while the subjective reasons of the decision-makers would be the focus of the inquiry in a case alleging a contravention of the general protections provisions in the FW Act, it was wrong to simply say that the reasons of the decision-makers would be of the salient decision-makers and would be given by way of evidence. It was pointed out that that as Barclay itself made plain (at [45]):
This question [the subject reason of the decision maker or decision makers] is one of fact, which must be answered in light of all the facts established in the proceeding. Generally, it will be extremely difficult to displace the statutory presumption in s 361 if no direct testimony is given by the decision-maker acting on behalf of the employer. Direct evidence of the reason why a decision-maker took adverse action, which may include positive evidence that the action was not taken for a prohibited reason, may be unreliable because of other contradictory evidence given by the decision-maker or because other objective facts are proven which contradict the decision-maker's evidence. However, direct testimony from the decision-maker which is accepted as reliable is capable of discharging the burden upon an employer …
(Emphasis added, footnotes omitted)
Mr Zaki also contended that if the substantial and operative subjective reason of one of a group of decision-makers was tainted by a proscribed reason, a respondent may fail to discharge its onus under s.361 of the FW Act and the decision of the collective may be found to be a contravention of the general protections provisions (see National Tertiary Education Union v Royal Melbourne Institute of Technology [2013] FCA 451; Construction, Forestry, Mining and Energy Union v Pilbara Iron Company (Services) Pty Ltd (No.3) [2012] FCA 697 and Elliott v Kodak Australasia Pty Ltd [2001] FCA 1804).
On the face of the pleadings, there was said to be plainly a factual dispute about the reason for Mr Zaki’s dismissal in circumstances where evidence of a decision-maker (or makers) about a reason or reasons for adverse action would not in itself necessarily be determinative. It was contended that the Applicant was entitled to pursue by way of subpoena records that would bear upon the reliability of the reasons for adverse action asserted by the Respondent.
Mr Zaki also pointed out that he had denied that he engaged in conduct entitling Russells to dismiss him summarily (ASOC at paragraph 63), while Russells maintained that “up to and including 17 May 2017” he engaged in misconduct and that the reason for his termination was misconduct capable of justifying summary dismissal (Defence at paragraph 64).
It was submitted that documents evidencing or recording communications between the partners of Russells (the decision-makers), about terminating Mr Zaki’s employment were “reasonably likely to add, in the end, in some way or other, to the relevant evidence in the case” and could reasonably be expected to “throw light” on core factual issues in the proceedings. This was said to be particularly so in circumstances where Mr Zaki had pleaded (ASOC paragraphs 38 to 40) that Mr Mattiussi and two other employees had informed him that there had been an exchange of emails between the partners in the days leading up to his termination in which a variety of reasons had been canvassed for terminating his employment, and had indicated that his employment was being terminated out of “spite” despite there being no lawful basis for the termination. Russells was said to have put these matters in issue in pleading in paragraphs 38 to 40 of the Defence that it did not know and could not admit those paragraphs.
Counsel for Mr Zaki also drew attention to the fact that Mr Zaki had given evidence of these asserted conversations in his affidavit of 7 August 2018 at paragraphs 6 to 13. I note that while this affidavit was not objected to for the purpose of the interlocutory proceedings, as counsel for Russells sought to make clear, the reading of this affidavit for such purpose would not prejudice any objections that might be made at another stage in the proceedings.
Mr Zaki also referred to the fact that the termination letter (a copy of which is annexed to the affidavit of Mr Sutherland sworn on 24 May 2018) offered him a fixed term contract up to 30 June 2017 (in circumstances where it was admitted that Russells knew that he had approved annual leave from 31 May 2017 to 30 June 2017). It was suggested that documents in relation to reasons why the partners would make such an offer might also bear on the reliability of the reasons stated in the termination letter for his summary dismissal.
In oral submissions counsel for Russells acknowledged that there might be some misunderstanding about what was at the heart of paragraph 51 (and also paragraphs 52-54) of the subpoena, insofar as counsel for Mr Zaki had indicated that the documents referred to therein were sought to test the reasons of the decision-makers for Mr Zaki’s dismissal. Counsel for Russells conceded that if paragraph 51 ought to be read as correspondence between the decision-makers in respect of their reasons for agreeing or joining in the decision for termination, then one might see how that could be sustained or supported on the relevant tests.
However it was submitted that paragraph 51 would also capture all sorts of “inconsequential” matters, such as correspondence about the mere fact that the termination had happened. It was said to be drafted in terms that were too broad and touched on everything in respect of the termination.
As discussed above, the credit and reliability of the asserted reasons of the decision-makers will be in issue in these proceedings. A subpoena may be used to obtain documents relevant to credit and, in the context of s.361 of the FW Act, to test asserted reasons of decision-makers.
I am satisfied that there is a legitimate forensic purpose in seeking all the communications between any of the partners “about” terminating Mr Zaki’s employment in the period specified. Russells did not appear to object on the basis of the time frame in paragraph 51. In any event, it is limited to the time between the date the Applicant claimed he and the other members of Team Jacobs were told there would not be a place for him at Russells (12 April 2017) and the date of termination of his employment (17 May 2017). Further, insofar as it is submitted that paragraph 51 would extend to the “process”, it is limited to communication between the partners and any “inconsequential” correspondence about the fact of termination of Mr Zaki’s employment would be limited to correspondence on the date of the termination letter. Production in this respect cannot be said to be oppressive.
I do not accept that this paragraph should be read as confined to communications in respect of the reasons of the decision-makers as Russells contended. This would require a subjective judgment about the scope of documents to be produced, in circumstances where communications between the decision-makers about terminating Mr Zaki’s employment may reflect on the reliability of stated reasons not only because of what is said in such correspondence, but also having regard to the identity of the sender and the timing of any communication, and hence may throw light on an issue in the proceedings. This paragraph should not be set aside.
Paragraph 52
Similarly, paragraph 52 of the subpoena calls for:
All documents evidencing or recording communications made between 12 April 2017 and 17 May 2017 between any of the Respondents about the Termination Letter.
The “Termination Letter” is defined in Schedule 1 to the subpoena to mean the letter (and annexures) to the Applicant dated 17 May 2017 signed by the eleventh respondent, who in turn is defined in Schedule 2 to mean Mr McCann.
Mr Zaki relied on his submissions in relation to paragraph 51 and also suggested that communications within the period in question between the decision-makers would inevitably throw light on the issues in relation to the credit and reliability of the asserted reasons of the decision-makers, including whether he was in fact dismissed to avoid paying him redundancy pay. He again referred to the pleading that a day before his dismissal Mr Mattiussi had a conversation with him (paragraph 38(b) of the ASOC) in which he was advised (among other things) that:
There had been a series of emails and draft letters exchanged between the equity partners and McCann, which Mattiussi had been sent and/or responded to, in which the equity partners and McCann had made two or three attempts at formulating a basis upon which to terminate the Applicant’s employment
This was said to be in issue as Russells pleaded that it did not know and therefore could not admit paragraph 38 of the ASOC.
It was submitted that communications between the partners about the termination letter were plainly “reasonably likely to add, in the end, in some way or other, to the relevant evidence in the case” and could reasonably be expected to “throw light” on one of the core factual issues in the proceedings, particularly given the matters pleaded in paragraph 38 of the ASOC and the Defence.
Counsel for Mr Zaki contended that while the termination letter recorded the stated reasons for Mr Zaki’s dismissal, if such reasons had changed and fluctuated and various partners (who were said to be the decision-makers) had been saying things in communications with each other about the termination letter which bore upon reasons for changing the stated reason for dismissal to be recorded in the termination letter (and/or the contemporaneous offer of a short fixed-term contract), this would plainly throw light on the reliability of the reasons for the decision recorded in the letter.
Initially Russells submitted that the sending of the termination letter was admitted, that the letter would “speak for itself” and that there was no other allegation or issue in the proceedings related to the termination letter itself. In oral submissions counsel for Russells acknowledged that communications among the decision-makers about the reasons for termination would be of apparent relevance. However Russells sought to distinguish such matters from what was “simply correspondence about a draft of a termination letter”. It was asserted that whether the reasons stated in the letter ultimately constituted the real reasons would be elucidated by the evidence given by the decision-makers, potentially supported by any documents that might be produced or discoverable in respect of the reasons for termination or why decision-makers agreed to the termination of Mr Zaki’s employment.
However, for the reasons discussed in relation to paragraph 51, I am satisfied that paragraph 52 is not too wide and that it has a legitimate forensic purpose. As Mr Zaki submitted, communications between the partners about the termination letter can reasonably be expected to throw light on core factual issues in the proceedings.
Paragraphs 53 to 54
Paragraphs 53 and 54 in the subpoena are as follows:
53. All documents evidencing or recording communications made between 12 April 2017 and 17 May 2017 between any of the Respondents and Ms Andrea Kilgariff and visa-versa about terminating the Applicant’s employment.
54. All documents evidencing or recording communications made between 12 April 2017 and 17 May 2017 between any of the Respondents and Ms Andrea Kilgariff, Mr Graeme McFadyen, Mr Kevin Johnston, Ms Luisa Patel or Mr Alan Rich and visa-versa about terminating the Applicant’s employment.
In submissions, Mr Zaki acknowledged that paragraphs 53 and 54 overlapped and sought only to press paragraph 54. For reasons given in relation to the documents sought in paragraph 51 and 52, it was submitted that documents evidencing or recording communications between the partners of Russells (the decision-makers), and the COO, and/or the CFO and other important senior persons in the operation of the Respondent firm, were “reasonably likely to add, in the end, in some way or other, to the relevant evidence in the case”.
Mr Zaki submitted that given that one, if not the, central issue in the proceedings would be the reason for his termination, it was difficult to see how communications amongst the decision-makers and senior management proximate in time to the termination and “about terminating the Applicant’s employment” could do other than “throw light” on the reason of the various decision-makers.In particular, Mr Zaki referred to the claim that he was dismissed to avoid paying him redundancy pay and submitted that communications at or around the time of his dismissal were likely to throw light on that issue and as a consequence were sought for a legitimate forensic purpose.
It was explained that paragraph 54 only sought documents evidencing or recording communications made between any of the partners and any of the named members of senior management between the time Mr Zaki understood he had been told that his position was going to be made redundant and his dismissal.
Russells submitted that the views or position that any of the persons named in paragraph 54 had or might have had in respect of the termination of Mr Zaki’s employment was not in issue. There was no claim against any of the named persons and hence said to be no issue as to their conduct or involvement in any of the alleged contraventions or in the decision-makers’ reasons for the termination. In addition to submissions made in relation to paragraphs 51 and 52, in oral submissions counsel for Russells reiterated that the named persons were not decision-makers and suggested that correspondence caught by paragraph 54 would not throw light on any of the issues in the litigation.
At this stage of the proceedings, the principles outlined in Stanley and the remarks of Wigney J in Gloucester are in point (see [21] - [25] above). The question of apparent relevance should not be approached too narrowly or rigidly and “the court should be wary of too readily excluding the possibility that a document or class of documents might at the end of the day be relevant to a fact in issue in the litigation” (Gloucester at [23]).
The documents sought have apparent relevance as being capable of bearing on matters in relation to the reliability of the reasons for dismissal asserted in the termination letter. In addition, as discussed above, there can be circumstances in which the reasoning process leading to an impugned decision involves a number of persons other than the ultimate decision-makers for the purposes of s.361 of the FW Act. In such circumstances it may be relevant to have regard to the reasoning process of any person whose involvement had a material effect on the ultimate decision (see for example Elliot v Kodak Australasia at [37]). Further, whether Mr Zaki was dismissed to avoid paying him redundancy pay is in issue.
Bearing in mind the need not to take too narrow an approach to the apparent relevance of documents sought where proceedings are at an early stage, I am satisfied that the documents sought have a bearing on a matter in issue (both credit and the redundancy pay issue) which is not “unreal, fanciful or speculative” (see R v Barton at 420), as discussed above in relation to paragraph 29 of the subpoena.
Paragraph 54 should not be set aside.
Paragraph 55
Paragraph 55 of the subpoena seeks:
Copies of any emails or other correspondence and communication sent to and from the email address [email protected] on 17 and 18 May 2017.
Written submissions for Mr Zaki contended that despite the fact that Russells had admitted allegations in paragraph 50 of the ASOC that Mr Mattiussi had arrived at the Supreme Court on 18 May 2017, apologised to the court and later written a note of apology to the judge (which followed a claim in paragraph 49 of the ASOC that Mr Zaki had “appeared” in the Supreme Court that day in a matter involving a client of Russells), Russells had put in issue Mr Zaki’s whereabouts and attendance in court “on the morning of 18 May 2017” (see paragraphs 47 to 49 in the ASOC and the Defence).
Russells objected to production of such material in response to the subpoena on the basis that the issues relevant to 17 May 2017 pleaded in paragraphs 41 to 44 of the ASOC were all said to have been “effectively” admitted in paragraphs 41 to 44 of the Defence.
It was pointed out that there was an admission (Defence paragraphs 42 and 52) of some emails between Mr Zaki and the Respondent on 17 and 18 May 2017, but observed that Mr Zaki had not sought production of those emails by way of a notice to produce. Russells acknowledged that Mr Zaki could seek production of the emails exchanged on 17 May 2017 in relation to the termination of his employment and his email of 18 May 2017 rejecting the offer of a short term contract on this basis.
The parties did not address paragraph 55 in oral submissions.
Mr Zaki’s whereabouts on 17 May 2017 (and emails exchanged between Mr Zaki and Russells on 17 May 2017 in relation to a proposed meeting that day) are pleaded in the ASOC and Defence at paragraph 42 and, to some extent, denied. Moreover, in paragraph 64 of the Defence one of the matters said to be part of the conduct that entitled Russells to terminate Mr Zaki’s employment contract without notice was said to be that he “failed to follow a lawful and reasonable direction to attend the meeting scheduled with the Respondent on 17 May 2017”. This clearly puts his whereabouts and conduct on 17 May 2017 in issue.
Having regard to the fact that the parties appear to differ on the details of emails sent by and to Mr Zaki on 17 May 2017 and the asserted relevance of his failure to attend a meeting on 17 May 2017 to the breach of contract claim, I am satisfied that all emails to and from Mr Zaki’s work email address on 17 May 2017 are such as to meet the legitimate forensic purpose test assessed at this stage of the proceedings (see Stanley at [9] and Gloucester at [23]).
Mr Zaki’s employment was terminated on 17 May 2017. While Russells pleaded that it did not know and therefore could not admit certain allegations in the ASOC about events of 18 May 2017, it is not apparent that such events, and hence any emails about Mr Zaki’s whereabouts on the morning after his employment ceased (the suggested relevance of the documents sought), have any potential relevance to real issues in the principal proceedings. To the extent paragraph 55 seeks emails of 18 May 2017 it should be set aside.
I note that, although not referred to by Mr Zaki in submissions in support of this paragraph, Russells acknowledged that one email of 18 May 2017 is referred to in the pleading.
Russells has conceded that Mr Zaki’s email of 18 May 2017 rejecting the offer of a short term contract ought to be available for production to him in response to a notice to produce. In the present circumstances, any insistence by Russells on a notice to produce in accordance with r.15A.17 of the Federal Circuit Court Rules 2001 (Cth) being issued by Mr Zaki (in addition to the subpoena) before provision of the pleaded email of 18 May 2017 sent by Mr Zaki to Russells may seem excessively technical, bearing in mind that the parties must avoid undue delay, expense and technicality in order to assist in achieving the just, efficient and economical resolution of proceedings (see r.1.03 of the Rules). However, such a process is available.
Paragraphs 58 to 60
Under the heading “Deduction of monies owed to the Applicant”, paragraphs 58 to 60 of the subpoena seek the following documents:
58. All documents evidencing or recording communications made between 1 April 2017 to 1 June 2017 between any of the Respondents about the Applicant’s entitlements under any contract of employment or pursuant to the Fair Work Act (Cth) 2009 (Act).
59. All documents evidencing or recording communications made between 1 April 2017 to 1 June 2017 between any of the Respondents about any deductions proposed to be made or on or about 31 May 2017 from the Applicant’s accrued but untaken leave entitlements.
60. All documents evidencing or recording communications made between 1 April 2017 to 1 June 2017 between any of the respondents and Mr Kevin Johnson (sic), Ms Andrea Kilgariff, Mr Graeme McFadyen, Ms Kylie May, Ms Luisa Patel or Mr Alan Rich about any deductions proposed to be made or on or about 31 May 2017 from the Applicant’s accrued but untaken leave entitlements.
In written submissions Mr Zaki contended generally that the documents captured by these three paragraphs in the subpoena were directly relevant to his entitlements under the FW Act and in contract in circumstances where it was alleged that Team Jacobs was disbanded; that he was the longest serving and most senior employed (non-partner) solicitor; that he was entitled to significant statutory and contractual payments in the event of his termination; and where Russells was said to have acted unilaterally and without Mr Zaki’s prior written authority in deducting monies against his entitlements under the FW Act and in contract after the termination of his employment on 17 May 2017.
In relation to paragraph 58, Russells submitted that there was no issue in the proceedings about what might have been Mr Zaki’s “entitlements” under his contract of employment or pursuant to the FW Act. Rather, the issue in the proceedings in respect of Mr Zaki’s entitlements was said to concern only the allegation that the Respondent sought to avoid paying him those entitlements.
Russells also contended that paragraph 59 did not serve a legitimate forensic purpose, as the fact of the deduction of amounts from what was paid to Mr Zaki after termination of his employment was admitted, as was the fact that the amount owed to him on termination included an amount in respect of accrued annual leave. It was submitted that the views of or discussions among any of the partners about these matters were not relevant to an issue in the proceedings. In particular, it was pointed out that there were no longer any claims made against individuals whose views might have been relevant in terms of establishing their knowing involvement in any contraventions of the FW Act.
In relation to paragraph 60, Russells again pointed out that it had admitted that the amounts that were owed to Mr Zaki on termination of his employment included an amount in respect of accrued but untaken annual leave (Defence paragraph 71(b)). It was reiterated that the issue in the proceedings was whether Russells was authorised to make a deduction or withhold an amount from the payment made to Mr Zaki on termination and submitted again that the views of any of the persons referred to in paragraph 60 in that respect were irrelevant and could not go to show whether or not Russells was legally entitled to do what it did. This submission was made on the basis that the reference to “leave” entitlements in paragraph 60 of the subpoena was a reference to annual leave. Russells would further object if the reference to “leave” was intended to extend beyond annual leave, on the basis that other leave entitlements were not in issue in the principal proceedings.
The parties did not address these paragraphs in oral submissions.
Paragraph 58 is not limited to “leave” entitlements. On its face it could be seen as seeking communications between any of the “Respondents” about any of Mr Zaki’s “entitlements”, which could include redundancy pay or notice pursuant to his employment contract. However this paragraph appears under the heading: “Deduction of monies owed to the Applicant” and was addressed in this context in the parties’ written submissions. As explained in Mr Zaki’s written submission, the suggested relevance of the documents sought is to the pleading in paragraph 70 of the ASOC of a deduction of monies owed and the pleaded contraventions of ss.44 and 323 of the FW Act. I have considered the apparent relevance of the documents sought under this paragraph on this basis.
Russells has admitted withholding an amount from amounts, including in respect of accrued but untaken annual leave and for work performed, paid on termination of Mr Zaki’s employment. This withholding is said by Russells to be in respect of a debt arising as a consequence of financial assistance advanced to Mr Zaki pursuant to the firm’s study assistance policy. What is in issue is whether Russells contravened s.323 of the FW Act in failing to pay Mr Zaki the amount he was entitled to be paid in relation to work he performed between 1 and 17 May 2017 and/or contravened ss.90(2) and 44 of the FW Act by failing to pay him an amount reflecting his accrued, but untaken, annual leave on termination.
Insofar as these matters raise a preliminary issue about the existence of Mr Zaki’s statutory entitlement to payment in respect of accrued annual leave, this entitlement was admitted (Defence paragraphs 65 and 66). In paragraph 70 of the Defence Russells also admitted that the amounts owed to Mr Zaki included an amount in respect of work performed between 1 and 17 May 2017 (albeit it stated that it had in fact calculated his entitlement to salary to 31 May 2017).
In other words, Mr Zaki’s “entitlements” to payment in respect of accrued annual leave and in respect of work performed between 1 and 17 May 2017 (which it appears are intended to be the subject of paragraphs 58 of the subpoena) are not in issue.
The fact and the amount of the deduction is not in issue. Whether it was a permitted deduction, under s.324 of the FW Act or otherwise, will be a matter of law. Mr Zaki’s submissions have not established the apparent relevance of the documents sought under paragraphs 58 to 60 of the subpoena. He has not identified the legitimate forensic purpose for which he requires the documents the subject of these paragraphs. They should be set aside.
As several of the disputed paragraphs in the subpoena have not been set aside, I will hear the parties on a timetable for production and consequential orders to progress this matter.
I certify that the preceding one hundred and twenty-three (123) paragraphs are a true copy of the reasons for judgment of Judge Barnes
Associate:
Date: 16 August 2019
0
24
4