Rigby & Kingston (No. 3) [2021] FamCA 146 (22 March 2021)

Last Updated: 19 August 2021

FAMILY COURT OF AUSTRALIA

Rigby & Kingston (No. 3) [2021] FamCA 146

ORDER

THE COURT ORDERS THAT:

1. The 20^th, 23^rd, 29^th and 30^th respondents be removed as parties to the proceedings.

2. The application in a case filed 4 March 2021 seeking a review of the Deputy Registrar’s decision to hear the objections to subpoena in chambers without an oral hearing be dismissed.

3. Paragraph 2 of the husband’s Response to the Applications in a Case filed 10 March 2021 as amended by leave on 11 March 2021, to discharge the stay of the third party respondents’ obligations, including any disclosure obligations, be adjourned for mention on 13 April 2021 at 10.00am.

4. The order made on 5 March 2021 be discharged.

5. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by T Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, T Pty Ltd in its own right and/or in its capacity as trustee for the Kingston Group Super Fund, and/or in its capacity as trustee for the Kingston Pty Ltd Super Fund and/or in its capacity as trustee for the U Unit Trust and/or in its capacity as trustee for the V Unit Trust, is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, T Pty Ltd in its own right is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(c) In relation to subparagraph 3(c) of the subpoena, T Pty Ltd in its capacity as trustee for the Kingston Group Super Fund is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(d) In relation to subparagraph 3(d) of the subpoena, T Pty Ltd in its capacity as trustee for the Kingston Pty Ltd Super Fund is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(e) In relation to subparagraph 3(e) of the subpoena, T Pty Ltd in its capacity as trustee for the U Unit Trust is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(f) In relation to subparagraph 3(f) of the subpoena, T Pty Ltd in its capacity as trustee for the V Unit Trust is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

6. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by S Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, S Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, S Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

7. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by Q Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, Q Pty Ltd in its own right and/or in its capacity as trustee for the Kingston Finance Unit Trust is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, Q Pty Ltd in its own right is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(c) In relation to subparagraph 3(c) of the subpoena, Q Pty Ltd in its capacity as trustee for the Kingston Finance Unit Trust is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

8. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by O Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, O Pty Ltd in its own right and/or in its capacity as trustee for the P Unit Trust is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, O Pty Ltd in its own right is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(c) In relation to subparagraph 3(c) of the subpoena, O Pty Ltd in its capacity as trustee of the P Unit Trust is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

9. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by Kingston (NSW) Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, Kingston (NSW) Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, Kingston (NSW) Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

10. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by Kingston Constructions Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, Kingston Constructions Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as they are not defined.

(b) In relation to subparagraph 3(b) of the subpoena, Kingston Constructions Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as they are not defined.

11. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by Kingston Developments Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, Kingston Developments Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, Kingston Developments Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

12. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by Kingston Group Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, Kingston Group Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, Kingston Group Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

13. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by Kingston Holdings Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, Kingston Holdings Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, Kingston Holdings Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

14. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by Kingston Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, Kingston Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, Kingston Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

15. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by N Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, N Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, N Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

16. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by Kingston Consolidated Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, Kingston Consolidated Pty Ltd in its own right and/or in its capacity as trustee for the Kingston Group Trust is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, Kingston Consolidated Pty Ltd in its own right is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(c) In relation to subparagraph 3(c) of the subpoena, Kingston Consolidated Pty Ltd in its capacity as trustee for the Kingston Group Trust is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

17. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by K Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, K Pty Ltd in its own right is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, K Pty Ltd in its own right is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(c) In relation to subparagraph 3(c) and 3 (d) of the subpoena, K Pty Ltd in its capacity as trustee for the Kingston Family Trust and /or in its capacity as trustee for Kingston Special Trust is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

18. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by J Holdings Pty Ltd (Registered Number ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, J Holdings Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, J Holdings Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

19. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by J Pty Ltd Registered Number ... on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, J Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, J Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

20. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by R Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, R Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, R Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

21. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by L Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, L Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, L Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

22. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by H Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, H Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, H Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

23. The objection to the production of documents in accordance with a subpoena issued 21 December 2020, filed by M Pty Ltd (ACN: ...) on 11 January 2021 be upheld to the following extent:

(a) In relation to subparagraph 3(a) of the subpoena, M Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

(b) In relation to subparagraph 3(b) of the subpoena, M Pty Ltd is not required to produce any documents for ‘related entities’ of the wife as defined in the subpoena other than the following:

(i) Kingston Testamentary Trust;

(ii) E Pty Ltd;

(iii) Ms Kingston Family Trust; and

(iv) D Pty Ltd.

24. Subject to the provisions of this order, leave is granted to the legal representatives for the parties to inspect and copy documents produced by the following named persons required to produce documents pursuant to subpoenas issued on 21 December 2020:

(a) T Pty Ltd;

(b) S Pty Ltd;

(c) Q Pty Ltd;

(d) O Pty Ltd;

(e) Kingston (NSW) Pty Ltd;

(f) Kingston Constructions Pty Ltd;

(g) Kingston Developments Pty Ltd;

(h) Kingston Group Pty Ltd;

(i) Kingston Holdings Pty Ltd;

(j) Kingston Pty Ltd;

(k) N Pty Ltd;

(l) Kingston Consolidated Pty Ltd;

(m) K Pty Ltd;

(n) J Holdings Pty Ltd;

(o) J Pty Ltd;

(p) R Pty Ltd;

(q) L Pty Ltd;

(r) H Pty Ltd; and

(s) M Pty Ltd.

25. The husband shall pay within 90 days an additional $7,367.45 to the named persons required to produce documents pursuant to subpoenas issued on 21 December 2020.

26. The Applications in a Case filed 3 March 2021 and 8 March 2021 and the Response filed 10 March 2021 as amended by leave on 11 March 2021 be otherwise dismissed save as to costs.

27. Any application for costs be determined in chambers upon the filing of written submissions within 14 days unless a party requests the matter to be listed for an oral hearing.

Note: The form of the order is subject to the entry in the Court’s records.



Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to 17.02 Family Law Rules 2004 (Cth).



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

REASONS FOR JUDGMENT

CAREW J

1 This long running dispute primarily concerns a property settlement claim by Mr Rigby (“the husband”) against Ms Kingston (“the wife”). There are numerous third party respondents (“the other respondents”). The current matters for my determination concern the following:

(1) Review of a Deputy Registrar’s decision to hear 19 objections to subpoena to produce documents in chambers without an oral hearing;

(2) Review of a Deputy Registrar’s decision to among other things, dismiss the 19 objections to subpoena to produce documents;

(3) Stay of the order for inspection and copying of the documents produced pursuant to subpoena;

(4) Payment of additional conduct money to the named persons^[1]required to produce documents pursuant to the subpoena of $7,367.45; and

(5) Removal of four of the other respondents as parties to the proceedings, namely the 20^th respondent, O Pty Ltd (as Trustee of the P Unit Trust), the 23^rd respondent, Q Pty Ltd (as Trustee of the Kingston Finance Unit Trust), the 29^th respondent, T Pty Ltd (as Trustee of the U Unit Trust), and the 30^th respondent, T Pty Ltd (as Trustee of the V Unit Trust).

2 It was conceded on behalf of the other respondents (and the additional named persons who are not parties to the proceedings), that the review of the decision to hear the objections to subpoena in chambers is otiose and the Application in a Case filed 4 March 2021 will be dismissed.

3 No submissions were made in relation to the application to stay the inspection of the documents produced but inspection was not pressed, no doubt anticipating a prompt decision in relation to the above matters.

4 It was conceded on behalf of the husband that an application (as contained in the husband’s response to the Applications in a Case filed 10 March 2021 as amended by leave on 11 March 2021) to discharge the stay of the other respondents’ obligations as parties, including disclosure, could not be heard given the late notice of the application. I will adjourn that part of the response for mention on 13 April 2021.

5 The wife took no active part in the hearing although she was represented and present.

BACKGROUND

6 It may be useful to set out some background to this dispute which involves not only the husband and wife but also her two brothers (the 2^nd and 3^rd respondents) and eight corporate entities, although some of the entities are the same but joined in different capacities.

7 For convenience I produce the following history which was set out in my reasons for judgment dated 13 November 2020^[2] at [3] – [14]:

3. The background to the dispute is set out in my Reasons for the factual findings delivered on 18 August 2020 at [7] to [15]. In short, after a long marriage which produced two children, the husband retains very few assets and is currently an unemployed finance professional living in a share house while the wife estimates her wealth to be in the vicinity of $7,000,000, including superannuation, and her average weekly income is $3,749. The husband and wife separated in 2015.

4. In my Reasons earlier referred to, I have described this case as unique, in circumstances where:

1. The wife’s wealth was largely derived from her father;
2. After their marriage in 1991 and until 2007, the husband and wife kept their finances separate and shared joint living expenses;

100. After 2007, the wife assumed a greater than equal share of the joint expenses and there was some minimal intermingling of their financial arrangements;

4. The joint expenses throughout the marriage did not include accommodation expenses which were met solely by the wife;
5. The husband and wife never owned property jointly nor operated joint bank accounts;
6. They maintained ledgers of their respective expenditure which were adjusted at regular intervals;
7. There were significant periods throughout their marriage when the husband was unemployed or underemployed;
8. Despite his greater availability, the husband’s contributions as homemaker and parent did not exceed those of the wife; and
9. The wife worked in her family’s business throughout the marriage and her financial contributions during the marriage greatly exceeded those of the husband.

In recounting the above matters, I am referring to matters of common ground or the factual findings made by me on 18 August 2020 as set out in the Reasons at [33], [38], [61] – [64], [88] – [89], [92], [94], [100]. [101], [104], [111], [118], [119], [121], [123].

5. Prior to his death in 2008, the wife’s father made it clear to her and her two brothers, Mr G Kingston and Mr F Kingston (both of whom are respondents in these proceedings), that he did not want the wealth created by him over his lifetime distributed to any spouse of his children or grandchildren. His Will reiterated those intentions and the testamentary trust established by him (the Kingston Testamentary Trust) sought to protect that wealth in accordance with those stated intentions.

6. Under the testamentary trust, the wife and her two children and the wife’s two brothers and their children are included as beneficiaries, as are any company in which any of the identified beneficiaries are a shareholder and any trust of which they are eligible beneficiaries. As at July 2019, Mr G Kingston had four children and Mr F Kingston had two children and four grandchildren.

7. The trustees of the trust are the wife and her two brothers.

8. On 13 February 2014, the testamentary trust was varied by the wife and her two brothers and one consequence of the variation was to extend the cessation date of the trust from 2026 to 2040 or a date unanimously agreed in writing by the wife and her two brothers (so long as they remain ‘active members’ as defined therein). The deed is referred to as the “Umbrella Deed”.

9. The Umbrella Deed recites that:

1. The wife and her two brothers are the remaining trustees appointed under their father’s Will (their mother having passed away);
2. Each of them work in the business/es of the Kingston Group and is entitled to share in any income or capital distributions made under the Will;

100. They have certain intentions in regards to:
     1. Their ongoing entitlements until 2040;
     2. Their ongoing entitlements in the event that they retire etc;
     3. The ultimate winding up of the Kingston Group on the cessation date.

10. The Kingston Group is defined by reference to schedule 1 to the Umbrella Deed.

11. The underlying principles for the arrangement set out in the Umbrella Deed include (unless the wife and her two brothers unanimously agree in writing to the contrary) that:

1. The wife and her two brothers shall remain active in the Kingston Group and share in the management;
2. They shall administer the Will according to its terms;

100. They shall each be paid an equal minimum annual dividend determined in accordance with an annual program and a share of profits not exceeding ten percent of net profits (the annual program relates to the Kingston Group);

4. In addition, they shall each be paid a salary;
5. No other directors are to be appointed;
6. No further shares or units will issue in any entity within the Kingston Group;
7. No shares or units will be transferred or redeemed; and
8. They must do everything required to wind up the Kingston Group on 30 June 2040.

12. Upon the winding up of the Kingston Group, the net amount realised is to be distributed equally among the wife and her two brothers subject to any adjustments required under the Umbrella Deed.

13. The husband commenced the substantive proceedings in 2016 and by his Initiating Application he seeks 35% of the property of the wife and himself (although the property in his name is de minimis). The wife argues that it is not just and equitable to make any property order.

14. A major source of dispute in this matter relates to the nature of the wife’s interests in the Kingston Group. The wife concedes that she has a right to due consideration as an eligible beneficiary of certain trusts within the Kingston Group and a right to due administration, but argues that as she does not control the Kingston Group, her interests represent, on a practical level, at best, a financial resource. The husband argues that the wife’s interests represent ownership of one third of the value of the Kingston Group. As such, he seeks, among other things, to bring forward the vesting date of various trusts within the Kingston Group, including the Kingston Testamentary Trust and a distribution to the wife of one third of the value thereof.

8 A spousal maintenance order was made in the husband’s favour on 13 November 2020 requiring the wife to pay $962 per week until 16 April 2021.

9 Particularly relevant for present purposes, on 13 December 2019 the husband consented to paragraph 3 of an order that required him to do the following:

(a) File and serve an Amended Initiating Application setting out with precision the precise orders sought on a final basis against each of the proposed third party respondents; and

(b) File and serve a Points of Claim document, pleading the contentions of fact and law, with specific reference to the particular provisions of the Family Law Act 1975 (Cth) relied upon as grounds for the relief sought by the applicant against each of the third party respondents in the Amended Initiating Application to be filed pursuant to subsection (a) and identifying, with reference to filed affidavits (including paragraph numbers in those affidavits), the contentions of fact to support each particular ground of relief.

10 Also by that order, any obligations as parties, including for disclosure, that the respondents (other than the wife) might have were stayed.

11 On 26 May 2020, the 4^th, 5^th, 6^th, 7^th, 10^th, 11^th, 13^th, 14^th, 15^th, 16^th, 17^th, 18^th, 19^th, 21^st, 22^nd, 24^th, 25^th, 26^th, and 31^st respondents were removed as parties in circumstances where it was found they were joined for an improper purpose, namely, for the sole purpose of obtaining discovery.^[3] The relief claimed against 27^th and 28^th respondents was summarily dismissed.^[4] The stay in relation to disclosure was extended “until the husband complies with his obligations pursuant to paragraph 3 of the Order dated 13 December 2019”.

12 The trial of the dispute is being conducted over a series of trial dates, the first of which occurred over the period 1 to 4 June 2020 in order to determine the following agreed list of issues:

(1) Did the parties conduct their financial arrangements during the marriage in accordance with the pre-nuptial agreement of 1991 and/or the financial agreement between them that they keep their finances totally separate, with all expenses being referred to in (1) shared equally?

(2) If the parties did conduct their financial arrangements in accordance with the agreement was the husband overborne by the wife to do so?

(3) Did the husband make substantial contributions of any nature recognised by the Family Law Act 1975 (Cth) to the improvement and conservation of property in the wife’s sole name over the years for which he was not recompensed?

(4) Was the husband underpaid for the work he did when employed as a contractor for the Kingston Group?

(5) Were the distributions made to the husband as a discretionary beneficiary of the CC Trust made in order to minimise tax for the wife or the family constituted by the husband, the wife and their children or were the distributions made as a tax effective means of the husband repaying loans the wife had made to him?

(a) Were the “loans” described in (5) in truth made and did the husband agree to borrow?

(6) Did the husband commence part time employment and then later his own consultancy which afforded him the opportunity to work less than full time hours in 2007 in order to enable him to meet the needs of the children?

(7) Did the contributions of the husband as homemaker and parent exceed those of the wife as homemaker and parent and were there periods he fulfilled a role of primary homemaker and/or parent and thereby indirectly contributed to the financial contributions being made by the wife?

(8) What were the contributions by the wife to the Kingston Group and how was she recompensed for her employment?

(9) What were the financial contributions of the husband during the relationship?

(10) What were the financial contributions of the wife during the relationship?

13 The initial trial dates did not involve the third party respondents, although their legal representatives were present for part of the hearing.

14 As already mentioned, findings of fact were made in relation to the above issues as set out in the reasons delivered on 18 August 2020^[5] at [33], [38], [61] – [64], [88], [89], [92], [94], [101], [111], [118], [121], [123].

15 On 13 November 2020 a further series of trial dates were allocated for the period 13 to 15 April 2021 when the following issues will be considered:

(1) What are the wife’s existing legal and equitable interests in any property including in any companies and trusts comprising the “Kingston Group” as identified in schedule 1 to the Umbrella Deed dated 13 February 2014?

(2) What is the effect, if any, of the Umbrella Deed on any existing legal and equitable interests of the wife?

(3) Does the wife have a source of financial support, other than any property in which she has an existing legal or equitable interest, which she can reasonably expect will be available to her to supply a financial need or deficiency?

(4) Is it just and equitable to make an order under s 79(1) of the Family Law Act 1975 (Cth)?

16 By the order made on 13 November 2020, the husband was required to file an amended Points of Claim that were in compliance with paragraph 3 of the order made 13 December 2019 on or before 1 February 2021.

17 At the instigation of the husband, 19 subpoenas issued on 21 December 2020 and were served on 22 December 2020.

18 Objections to the subpoena were required to be filed by 12 January 2021 and thus prior to the date by which the husband was required to file his amended Points of Claim, namely, 1 February 2021.

19 Objections to the subpoena were filed by all named persons on 11 January 2021;

20 On 29 January 2021 an order was made requiring parties to file written submissions and jointly request a date for hearing of the objections forthwith upon close of submissions, namely, by 1 March 2021.

21 On 1 February 2021 the husband filed a further further amended Initiating Application and further further amended Points of Claim.

22 In the absence of a request for a hearing date in relation to the objections to subpoena, notice was given to the parties on 3 March 2021 that the objections to subpoena would be determined in chambers by a Deputy Registrar.

23 On 3 March 2021 an Application in a Case was filed seeking the following relief:

(a) The removal of the 20^th, 23^rd, 29^th and 30^th respondents from the proceedings;

(b) The husband to pay conduct money to the recipients of the subpoena in the sum of $7,367.45;

(c) Costs of the application.

24 On 4 March 2021 a second Application in a Case was filed seeking a review of the decision to determine the objections to subpoena in chambers.

25 On 5 March 2021 an order was made:

(a) Dismissing the objections to subpoena and granting leave to the legal representatives for the parties to inspect and copy documents produced;

(b) Granting to each party liberty to file written submissions as to costs by no later than 10 March 2021;

(c) Providing for any costs application to be determined at the same time as paragraph 2 of the application filed on 3 March 2021 i.e. conduct money;

(d) Procedural orders.

26 On 5 March 2021 a third Application in a Case was filed seeking a review of the decision to dismiss the objections to subpoena and a stay of the order for inspection.

27 On 10 March 2021 the husband filed a Response to the Applications in a Case seeking their dismissal and also the discharge of the stay in relation to disclosure. The husband was granted leave to amend his Response in terms of the minute of order marked exhibit 3 in the proceedings.

28 In dealing with the various interlocutory matters requiring determination, it was agreed between the parties that I should firstly consider the application to remove certain respondents from the proceedings.

DISJOINDER

20th, 23rd, 29th and 30th Respondents’ case – on the disjoinder point

29 The 20^th respondent, O Pty Ltd is joined in its capacity as the Trustee of the P Unit Trust. The 23^rd respondent, Q Pty Ltd is joined in its capacity as Trustee of the Kingston Finance Unit Trust. T Pty Ltd is joined in its capacity as Trustee of the U Unit Trust as the 29^th respondent and in its capacity as Trustee of the V Unit Trust (“the Unit Trusts”) as the 30^th respondent.

30 The Unit Trusts argue that the husband has not complied with his obligations under the order made on 13 December 2019 (the relevant parts of which are set out at [9] above) in that, in the most recent iteration of the final relief sought contained in the further further amended Initiating Application (“the Initiating Application”) and the further further amended Points of Claim (“Points of Claim”) both filed 1 February 2021, no order is sought against any of the Unit Trusts and no contentions of fact or law have been pleaded to justify them remaining as parties in the proceedings.

31 Further, it is argued that any suggestion that the Unit Trusts are necessary parties by reason of r 6.02 of the Family Law Rules 2004 (Cth) (“the Rules”) is simply not made out. Neither the wife nor any entity said to be controlled by her, namely, D Pty Ltd, E Pty Ltd and Ms Kingston Family Trust, are unitholders in those trusts.

Husband’s Case – on the disjoinder point

32 Firstly, the husband submits, that the Points of Claim document was “not properly represented” during submissions made on behalf of the Unit Trusts in two respects. Firstly, when submitted that “no relief is claimed against the trusts” and secondly that there is “no claim in relation to vesting” and that those “two propositions” are “not correct”.

33 It is nevertheless conceded by the husband, that the wife does not own units in any of the Unit Trusts and I infer (as it was not cavilled with) nor do any of the entities controlled by the wife.

34 The fundamental argument of the husband in the substantive proceedings is that his claim cannot be satisfied out of property in the wife’s name and thus it is necessary for the Unit Trusts to be parties so that the husband’s entitlement can be satisfied or partly satisfied from the assets of the Unit Trusts. In order to achieve that, it is argued, the vesting date of the Unit Trusts necessarily must be brought forward. Hence, it is argued that while the order sought against the Unit Trusts in a previous iteration of the Initiating Application included that the vesting dates be brought forward, the same relief is in fact being sought in the latest iteration of the Initiating Application as evident from the alternate relief sought. Whether that be by “the direct payment from the trusts avenue” or “the Cessation Date [of the Umbrella Deed] ... accelerate that date” avenue or the “set aside of the Umbrella Deed” avenue or the “simply set aside the umbrella deed, and then adjourn the proceedings to 2026” avenue or “simply adjourn the proceedings until 2040 ... as a last resort”.

35 The husband argues that the latest iteration of the Initiating Application does seek relief against the trusts. “What it says with precision is that ... human beings, who are the executors of the will, the directors of the trustee companies, and the parties to the umbrella deed ... should [be] order[ed] ... in those capacities, to cause corporate trustees to make a payment to the husband”. Further, that the “wife has a current right. The forensic challenge... is to vindicate that right in 2021, rather than 2040 or 2026”.

36 Further, the husband argues that r 6.02 of the Rules, on its face, requires the Unit Trusts to be parties because the “vesting of the trusts does directly affect the unit trusts which the trust owns” and thus their “participation is necessary for the court to determine all issues in dispute”. The husband’s application contemplates under Part VIIAA of the Family Law Act 1975 (Cth) (“the Act”), the alteration “of the rights, liabilities or property interests of a third party in relation to the marriage” and such an order can only be made “if the third party has been afforded procedural fairness”.

37 “The case that [the husband is] bringing, which is not a fanciful case – it is a contested case, but it’s not a fanciful case, based on the terms of the will, the terms of the umbrella deed, and the pattern of distributions – it is absolutely, fairly and squarely requiring the trusts to be part of the proceedings”.

Conclusion - disjoinder

38 The only reference to the Unit Trusts in the Initiating Application is as follows:

1. That pursuant to sections 79, 90AE and/or 90AF of the Family Law Act 1975 (“the Act”) the first, second and third respondents in their capacities as:

(a) trustees of the Last Will and Testament of Mr Kingston dated 5 May 2005 (“the Will”);

(b) Active Members under the Umbrella Deed entered between the first, second and third respondents and dated 13th day of February 2014 (“the Umbrella Deed”); and

(c) Directors of the 8th, 9th, 12th, 20th, 23rd, 29th and 30th Respondents

cause the 8th, 9th, 12th, 20th, 23rd, 29th and 30th Respondents to make such payment to the Husband as is required to effect a property settlement in his favour representing 35% of the total of A plus B plus C where:

A = the assets in the name of the Wife;

B = the assets in the name of the Husband; and

C = one-third of the value of the Kingston Group.

...



4. In the alternative to paragraphs 1, 2 and 3 above, that this Honourable Court:

...

(d) pursuant to section 90AF of the Act, order the first, second and third respondents in their capacities as:

...

(3) Directors of the 8th, 9th, 12th, 20th, 23rd, 29th and 30th Respondents;

provide the Husband with:

(4) annual financial statements of the 8th, 9th, 12th, 20th, 23rd, 29th and 30^th Respondents, including without being limited to taxations returns, profit and loss statements and balance sheets within 7 days of such documents being produced; and

(5) 14 days’ notice of any intended distribution from any of the 8th, 9th, 12th, 20th, 23rd, 29th and 30th Respondents.

5. In the alternative to paragraphs 1, 2, 3 and 4 above, that this Honourable Court:

...

(c) pursuant to section 90AF of the Act, order the first, second and third respondents in their capacities as:

...

(3) Directors of the 8th, 9th, 12th, 20th, 23rd, 29th and 30th Respondents;

to provide the Husband with:

(4) annual financial statements of the 8th, 9th, 12th, 20th, 23rd, 29th and 30^th Respondents, including without being limited to taxations returns, profit and loss statements and balance sheets within 7 days of such documents being produced; and

(5) 14 days’ notice of any intended distribution from any of the 8th, 9th, 12th, 20th, 23rd, 29th and 30th Respondents.

(emphasis added)

39 Apart from pleading matters of identification in respect of the Unit Trusts no facts or contentions of law are pleaded to justify the joinder of the Unit Trusts. When a number of other respondents were removed as parties on 26 May 2020^[6] I noted the following at [58]:

58. With the consent of the third party respondents, the husband will nevertheless have a further opportunity to state with precision the order sought against each of the remaining third party respondents and to plead the factual basis to support the orders sought.

40 At the time that concession was made there was an order sought directly against the Unit Trusts.

41 In my reasons for judgment dated 26 May 2020^[7] I quoted the following authorities from [15]:

15. In Wayne & Dillon, Warnick J (sitting in the appellate division) said:

17. ... any person joined to a proceeding ought, at that point, be able to take advice on whether the facts pleaded (if established) would lead to a successful claim. Joinder to litigation is a serious step with often significant financial consequences.

16. In B Pty Ltd v Ors & K and Anor, the Full Court (Faulk DCJ, Coleman and Warnick JJ) allowed an appeal by third parties concerned with relief sought under Part VIIIAA of the Act and said:

52. We do not accept that it is proper to allow joinder of third parties merely upon the formulation of a paragraph in, or to be added to, an application, on the basis that at trial facts to support the application may be asserted and proved. Sufficient facts must be asserted to demonstrate that, if proved, the law arguably provides the relief sought.

...

32. The very point of pleadings is to enlighten a party as to the case they will meet at trial. As the High Court said in Dare v Pulham (Murphy, Wilson, Brennan, Deane and Dawson JJs writing jointly):

Pleadings and particulars have a number of functions: they furnish a statement of the case sufficiently clear to allow the other party a fair opportunity to meet it ...; they define the issues for decision in the litigation and thereby enable the relevance and admissibility of evidence to be determined at the trial ...; and they give a defendant an understanding of a plaintiff's claim in aid of the defendant's right to make a payment into court. Apart from cases where the parties choose to disregard the pleadings and to fight the case on issues chosen at the trial, the relief which may be granted to a party must be founded on the pleadings...

(citations omitted)

42 I further noted in my reasons for judgment dated 26 May 2020^[8] at [32] – [33]:

32. Consistent with the requirements of ss 90AE and/or 90AF the husband must identify:

a) What it is that the husband seeks of each third party; or

b) What rights, liabilities or property interests of each third party the husband seeks to alter; and

c) Why is the order or injunction reasonably necessary; or

d) In what way is the order or injunction sought by the husband against each third party reasonably appropriate and adapted to effect a division of property between the parties to the marriage; and

e) How is the order or injunction proposed by the husband just and equitable or proper or just and convenient.

33. It is only when those matters are apparent the third party respondents will be able to provide evidence of such matters as are required by ss 90AE and/or 90AF, for example:

a) The taxation effect (if any) of the order or injunction on each third party;

b) The third party’s administrative costs in relation to the order or injunction;

c) The economic, legal or other capacity of each third party to comply with the order or injunction; and

d) Any other matter raised.

(citations omitted)

43 In the absence of any pleading identifying how the rights of the Unit Trusts (in which neither the wife nor entities controlled by her hold units) may be directly affected, it is not apparent why they should remain as parties to the proceedings. There is, for instance, no assertion that the Unit Trusts are shams, and even in circumstances where trustees and beneficiaries have chosen to no longer be bound by the obligations of the trust relationship (not that this is pleaded by the husband) - “A trust once validly constituted does not change in nature because the trustee and some beneficiaries subsequently choose no longer to abide by the obligations of the trust relationship”.^[9]

44 It seems the husband argues that if the cessation date of the Umbrella Deed is brought forward it necessarily follows that all trusts included in the “Kingston Group” (a description about which there is some contention in any event) vest. How this can be so when the Unit Trusts are not parties to the Umbrella Deed remains unexplained.

45 In my view, the husband has failed to establish how the Unit Trusts are necessary parties to the proceedings and accordingly they will be removed.

THE REVIEW PROCESS – OBJECTIONS TO SUBPOENAS

46 The review of a Deputy Registrar’s decision is heard as an original hearing i.e. it is a rehearing of the whole matter and not simply a review of the decision of the Deputy Registrar (see r 18.10 of the Rules).

47 On 22 December 2020 the husband served the following subpoenas upon the following named persons:

(i) T Pty Ltd

1. in its own right;
2. in its capacity as trustee for the Kingston Group Super Fund;
   100. in its capacity as trustee for the Kingston Pty Ltd Super Fund;
   4. in its capacity as trustee for U Unit Trust; and
   5. in its capacity as trustee for V Unit Trust.

(ii) S Pty Ltd

(iii) Q Pty Ltd

1. It is own capacity; and
2. It its capacity as trustee for the Kingston Finance Unit Trust

(iv) O Pty Ltd

1. In its own capacity; and
2. It is capacity as trustee for the P Unit Trust

(v) Kingston (NSW) Pty Ltd

(vi) Kingston Constructions Pty Ltd

(vii) Kingston Developments Pty Ltd

(viii) Kingston Group Pty Ltd

(ix) Kingston Holdings Pty Ltd

(x) Kingston Pty Ltd

(xi) N Pty Ltd

(xii) Kingston Consolidated Pty Ltd

1. In its own right; and
2. It its capacity as trustee for the Kingston Group Trust

(xiii) K Pty Ltd

1. In its own right;
2. In its capacity as trustee for the Kingston Family Trust; and
   100. In its capacity as trustee for the Kingston Special Trust.

(xiv) J Holdings Pty Ltd

(xv) J Pty Ltd

(xvi) R Pty Ltd

(xvii) L Pty Ltd

(xviii) H Pty Ltd

(xix) M Pty Ltd

48 None of the companies subpoenaed, object to the production of documents evidencing any loan account or payment of dividends to the wife or to four defined ‘related entities’ namely, Kingston Testamentary Trust, E Pty Ltd, Ms Kingston Family Trust and D Pty Ltd. Some of the companies^[10] object to the production of annual financial accounts and tax returns for the financial years ended 30 June 2018, 2019 and 2020 in circumstances where neither the wife nor an entity controlled by her is a shareholder. Five of the companies, namely, Kingston Constructions Pty Ltd, R Pty Ltd, Kingston Group Pty Ltd, O Pty Ltd and Q Pty Ltd, object to producing their constitutions and any amending constitutions for that same reason.

49 None of the trustees of the unit trusts subpoenaed object to the production of documents evidencing any loan between a unit trust and the wife or four defined ‘related entities’ namely, Kingston Testamentary Trust, E Pty Ltd, Ms Kingston Family Trust and D Pty Ltd, but objection is taken to the production of the trust deeds and annual accounts in circumstances where neither the wife nor any of her entities are unitholders in any of the unit trusts and the wife has no legal or equitable interest in the unit trusts.

50 None of the trustees for the discretionary trusts object to the production of trust deeds or amendments thereto nor to the production of documents evidencing any loan between a discretionary trust and the wife or four defined ‘related entities’ namely, Kingston Testamentary Trust, E Pty Ltd, Ms Kingston Family Trust and D Pty Ltd or to the production of documents evidencing any unpaid present entitlements of the wife or the four ‘related entities’.

51 The self-managed super funds have no objection to the production of trust deeds and the financial statements for the funds in which the wife is a member.

52 Pursuant to r 15.31 of the Rules, a named person is entitled to object to producing a document in accordance with a subpoena. I take this to mean that where several documents are required to be produced in accordance with a subpoena, an objection may be taken to producing some documents and not others. In this case objections to the production of identified documents have been filed by each named person. Some changes were made to the documents to which objection was taken and a helpful table was tendered^[11] identifying which named person objects to which documents.

53 In addition to the right to object to producing a document, a named person has a separate entitlement pursuant to r 15.26 to seek an order that the subpoena be set aside in whole or in part. Although the matter was argued on the basis that the named persons were seeking to set aside the subpoenas (if the subpoenas could not be amended), I have been unable to locate any application where such an order is sought. There was no point of contention raised on behalf of the husband on this point.

54 If successful in their objection, the named persons argue that the objection could be addressed by striking out the words “include but” and “not limited to” and striking out reference to S Pty Ltd, T Pty Ltd, Kingston Holdings Pty Ltd and Kingston (NSW) Pty Ltd where those entities are included in the notation to any subpoena.

55 The husband concurs that if I am against him on the general nature of the definition of related entities, the words identified could be struck through.

56 However, it seems to me that if I am satisfied that objection is properly taken to particular documents as identified in Exhibit 2, I can relieve the named persons from producing particular documents.

57 In those circumstances, the possibly contentious issue of the power of the Court to amend a subpoena (other than in the case of ambiguity^[12]) does not arise. The power to amend a subpoena pursuant to the Rules is only specifically provided for at a time prior to service of the subpoena (see r 15.20). With the greatest respect to some judges of this Court who have assumed the Court has a general power to amend a subpoena,^[13] I remain sceptical but I do not need to express a concluded view.

58 The bases for objection to the production of certain documents that have issued at the instigation of the husband are as follows:

(a) Relevance;

(b) Oppression in that the recipients of the subpoena are required to make a judgment on the meaning of “related entities”;

(c) Abuse of process in that the husband is using the subpoenas for the purpose of discovery and for the purposes of ascertaining whether he has a case against third parties.

Relevance argument

59 The named persons required to produce documents pursuant to subpoena, argue that the husband needs to establish a prima facie case against each named person before the documents to which objection is taken, are required to be produced.

60 Further, it is argued that ‘apparent relevance’ cannot be established for the production of documents from entities in which the wife has no interest either in her own right, as a beneficiary or shareholder or by reason of loans made to her or by her or by reason of the related entities identified in the subpoena. For instance, in relation to T Pty Ltd as trustee for U Unit Trust, it is not in contention that neither the wife nor any entity controlled by her has units in the trust and yet the financial accounts and tax returns for the Unit Trust are the subject of subpoena.

61 The entities for which objection is taken on this basis i.e. relevance, are as follows:

(a) T Pty Ltd as trustee for U Unit Trust;

(b) T Pty Ltd as trustee for V Unit Trust;

(c) K Pty Ltd in its own right;

(d) Kingston Consolidated Pty Ltd in its own right;

(e) O Pty Ltd in its own right and in its capacity as trustee for the P Unit Trust;

(f) Q Pty Ltd in its own right and in its capacity as trustee for the Kingston Finance Unit Trust;

(g) N Pty Ltd;

(h) Kingston Pty Ltd;

(i) Kingston Construction Pty Ltd;

(j) Kingston Group Pty Ltd;

(k) H Pty Ltd;

(l) J Pty Ltd;

(m) J Holdings Pty Ltd;

(n) L Pty Ltd

(o) M Pty Ltd;

(p) Kingston Developments Pty Ltd; and

(q) R Pty Ltd.

62 The documents to which objection is taken are described as “annual financial accounts and tax returns for the FYE 30 June 2018, 2019 and 2020” and in relation to some of the entities the “constitution and any amending constitution” and in relation to the unit trusts “trust deed and any amendments”.

63 The named persons also take objection to the production of certain documents included in the definition of the wife’s ‘related entities’ namely, S Pty Ltd, T Pty Ltd, Kingston Holdings Pty Ltd and Kingston (NSW) Pty Ltd on the basis that “dividend[s] or loan[s] within the intercompany group between companies” have no apparent relevance.

64 The husband argues that the documents to which objection is taken are relevant to the property adjustment and spousal maintenance claim “as well as contentions of fact relied upon by the wife ... including:

(1) the wife’s sworn evidence under cross-examination by the husband at the June 2020 hearing that her two brothers received identical distributions as herself from the Kingston Testamentary Trust between 30 June 2004 and 30 June 2015 and that she was unable to specify which of the particular trust or trusts within the Kingston Group were the primary source of those funds; and

(2) the wife’s sworn evidence in her affidavit filed on 7 October 2020 in relation to the alleged decreasing profitability of the Kingston Group in the context of her response to the husband’s interim applications for litigation funding and spousal maintenance. ...”

Conclusion – relevance

65 It is not in dispute that in order to inspect the documents produced pursuant to subpoena the husband must establish apparent relevance as explained in National Employers' Mutual General Association Ltd v Waind and Hill^[14] and adopted by the Full Court in Hatton v Attorney General of the Commonwealth of Australia and Ors^[15] at 87,605:

...production of a document on subpoena by a stranger is only required if the document is sufficiently relevant to the action in the sense that it is likely to add in the end, in some way or other, to the relevant evidence of the case.

66 I reject the submission that the husband must establish a prima facie case against the named persons in order to establish relevance. That seems to me to be conflating the disjoinder argument with the objection to subpoena argument.

67 By the terms of the Umbrella Deed, to which the wife is a party, upon the winding up of the Kingston Group (which is defined in the schedule attached to the Deed and includes all of the above named entities at [61]) the net amount realised is to be distributed equally among the wife and her two brothers subject to any adjustments required under the Umbrella Deed. When giving effect to the terms of the Umbrella Deed, existing trusts within the Kingston Group cannot be ignored, however, it seems to me that documents of the Kingston Group as defined by the Umbrella Deed have apparent relevance to the claim made by the husband in these proceedings for 35 per cent of what he argues is the wife’s property or at the very least a financial resource.

68 The objection taken to the identified documents on the ground of relevance therefore fails.

Oppression argument

69 The named persons argue that the subpoenas are oppressive because the named person is required to make a judgment about whether or not an entity is “related to” the wife. A recipient of the subpoena “ought to be able to look at the subpoena and understand what they’re being asked to do and how they comply with it”. Further, there is no definition of related entity nor is it a “term of art, so a reader will not understand or cannot understand what that means”. By way of example, the term “related entity” in relation to a body corporate is defined in s 9 of the Corporations Act 2001 (Cth) (“the Corporations Act”) and includes: a director or a member, a relative of the director or member, a relative of a spouse of the director or member etc. The word “relative” is then also defined in s 9 of the Corporations Act to mean: a spouse, parent or remoter lineal ancestor, child or remoter issue, or brother or sister of the person. The subpoenas contain no definition of “related entity”.

70 In response to this argument, the husband contends that “[e]ach of the subpoenaed parties is an entity of which the wife is a director” and that the “practical reality of the situation is that, at its highest, the only requirement imposed by the subpoenas is the requirement that each company ascertain certain existing information from one of its directors, namely, a list of that director’s ‘related entities’. It is not oppressive for the wife, as a director of each subpoenaed company, to elucidate which entities are her ‘related entities’. Such information is well-known to the wife and could be communicated by her to the other directors of the companies for the purposes of complying with the subpoena. The wife herself has not objected to any of the subpoenas...”.

71 I note that the subpoenas issued to each named person other than Kingston Constructions Pty Ltd, L Pty Ltd, O Pty Ltd and Kingston Consolidated Pty Ltd contains a notation which includes the following:

Patricia’s related entities include but are not limited to:

(a) Kingston Testamentary Trust;

(b) E Pty Ltd;

(c) Ms Kingston Family Trust;

(d) D Pty Ltd;

(e) S Pty Ltd;

(f) T Pty Ltd;

(g) Kingston Holdings Pty Ltd; and

(h) Kingston (NSW) Pty Ltd.

(emphasis added)

72 The notation to each subpoena issued to L Pty Ltd, O Pty Ltd and Kingston Consolidated Pty Ltd do have a notation but the list of related entities does not include T Pty Ltd.

73 There is no notation to the subpoena issued to Kingston Constructions Pty Ltd defining the term “related entities” which appears in the subpoena.

74 Nonsensically the subpoena issued to S Pty Ltd includes S Pty Ltd in the definition of related entities i.e. requires the production of documents such as loan documents made to itself. Similar errors appear in other subpoena e.g. to T Pty Ltd, Kingston Holdings Pty Ltd and Kingston Holdings Pty Ltd.

Conclusion – oppression

75 It is not really an answer to the objection to say, as the husband does – well the wife has not objected. The wife is not the named person although she has a right, as an interested person to take objection.

76 It is the named person who is required to comply with a subpoena and in each case the proper officer of the entity would be required to make a judgment about what is a ‘related entity’ and, as demonstrated by the named persons, a judgment of that nature is not a straightforward task in the case of either an ill-defined or undefined term.

77 “A subpoena can only properly be used for the production of documents described in particular or general terms which does not involve the making of such a judgment”.^[16]

78 In my view the named persons have established oppression in relation to the definition (or in one case the absence of any definition) of “related entities”. The appropriate course is to release particular named persons from the obligation to produce particular documents.

Abuse of process argument

79 It is not in dispute that a subpoena issued for the purposes of discovery is an abuse of process. In Commissioner for Railways v Small^[17] Jordan CJ (with whom Davidson and Owen JJ agreed) said at 573:

It is not legitimate to use a subpoena for the purpose of endeavouring to obtain what would be in effect discovery of documents against a person who, being a stranger, is not liable to make discovery. A stranger to the cause ought not to be required to go to trouble and perhaps to expense in ransacking his records and endeavouring to form a judgment as to whether any of his papers throw light on a dispute which is to be litigated upon issues of which he is presumably ignorant...”

80 The named persons argue that despite these proceedings being on foot since 2017 and the husband attempting to join them as parties in four iterations of pleading and failing in large part to properly plead a case against them, he is seeking to circumvent proper processes by in effect pursing discovery against third parties.

Conclusion – abuse of process

81 In my view, the subpoenas do not seek to impose on the named persons a process of discovery. The subpoenas seek production of identified documents from entities which make up the Kingston Group (as defined in the Umbrella Deed) in circumstances where the Umbrella Deed provides for the eventual equal distribution among the wife and her two brothers of the net realised proceeds upon the winding up of the Kingston Group.

ADDITIONAL CONDUCT MONEY

82 The husband paid the minimum amount mentioned in Part 1 of Schedule 4 of the Rules i.e. $25 to each named person served with a subpoena. The total sum paid was $475.

83 The named persons contend that such a sum is not sufficient to meet their reasonable expenses in complying with the subpoenas in that they have suffered substantial expense which should be addressed by the payment of a further $7,367.45.

84 The named persons’ solicitor, Mr Hede, deposes that upon service of the 19 subpoenas he provided them to his clients’ accountant, B Pty Ltd to assist his clients to compile the information sought in the subpoenas. An invoice issued by B Pty Ltd for $11,203.50 less a discount of $3,361.05. Mr Hede deposes that his clients paid the discounted invoice of $7,842.45. The invoice dated 31 January 2021 is annexed to the affidavit. The shortfall after deducting the conduct money paid by the husband is $7,367.45.

85 In support of the claim for additional conduct money it is argued that “the documents sought [pursuant to the subpoenas] traverse at least 29 different entities and have taken weeks to address, the conduct money is plainly inadequate”. While it is conceded that it might have been helpful to have more evidence upon which to assess the reasonableness of the amount claimed, it is argued that the Court is not looking at the invoice in a vacuum. Reference is made to the detail involved in complying with 19 subpoena and the “many micro decisions about how this had to be approached” and is amply illustrated by the four page spreadsheet prepared and tendered (Exhibit 2). “An accountant for all those entities has got to trawl through, not just the entity names ... connected with Ms Kingston, but whatever other entity names fall into accounts of whatever other of the 31 entities they are asked to look at. Because just as [the wife] has got her own family trust and companies that she 100 per cent controls, it follows that [her brothers] and their families have probably got their own entities”. Further, a party served with a subpoena is compelled to return documents to Court before a determination of any objection to production is undertaken.

86 The husband does not oppose the payment of a reasonable amount but contends that there is no cogent evidence to support the amount sought and that “[t]he documents sought are prima facie documents that the entities have a legal obligation to maintain and could simply be taken ‘off the shelf’ for the purposes of compliance with the subpoena”. It is not disputed that the sum clamed is large or substantial but it is disputed that “compliance with the subpoena was a significant inconvenience or unreasonable burden requiring the engagement of professional accountants to perform work that resulted in gross fees of $11,203.50”. Reliance is placed upon Moriarty & Moriarty^[18] where Cronin J said at [58]:

58. The determination of what is substantial is very subjective. In my view, it means that the expense must be large causing loss; it must be unusual in the sense of requiring normal activity to be stopped; or it must cause an unfair inconvenience having regard to the fact that the recipient has nothing to do with the litigation.

59. Assessment of the reasonableness of burdens involved in complying with a subpoena must take account the capacity of a party to collect and produce the documents. That means that in a large organization, the capacity to cover the expense is greater than in a small organization (see Lucas Industries v Hewitt (1978) 18 ALR 555 and G and D & D (2005) FamCA 1429).

60. Notwithstanding the administration of justice issue, the rules are not intended to put the individual presenting the documents in a position where they lose income or capital. The rule however refers to a substantial expense and each situation must be determined on its peculiar facts.

61. However, if the subpoena is simple and clear, requiring the production of the recipient’s own documents, the inconvenience is intended and expected to be minimal.

62. Thus, in a case where a professional fee is claimed or the bobcat driver claims significant hours of “downtime”, the question still remains whether the finding, collecting, collating, marshalling and producing the documents or materials required the attention of the owner, partner or professional or whether it could be done by a clerical person albeit with some ownership or professional oversight. It is that question that the judicial officer has to ask in every case.

Conclusion – conduct money

87 A named person is entitled to apply to be reimbursed if the named person incurs a substantial loss or expense that is greater than the amount of the conduct money tendered at the time of service of the subpoena (r 15.23(3)). While this subrule does not include any words of limitation other than the loss or expense being substantial, I am prepared to infer that such loss or expense must be reasonable because in r 15.23(1) reference is made to a named person being entitled to be paid conduct money at the time of service of the subpoena that is sufficient to meet the reasonable costs of complying with the subpoena.

88 In this case I observe that each subpoena contains multiple subparagraphs which require each entity to produce documents that are not always “off the shelf” documents but for instance require consideration of what documents might fall within a given description and the location of those documents for various periods. For example, the subpoena issued to T Pty Ltd requires the production of documents “evidencing” loan accounts and trust distributions, held not only in its own right but also as trustee for the Kingston Ltd Super Fund, as trustee for the Kingston Group Super Fund, as trustee for the U Unit Trust and as trustee for the V Unit Trust. The numerous documents subpoenaed from T Pty Ltd in each of those capacities are sought for a seven year period.

89 In my view, Exhibit 2 more than satisfactorily illustrates the, no doubt, time consuming process of collating documents in answer to the subpoenas.

90 Accordingly, in this particular case I am comfortably satisfied that the named persons have incurred a substantial expense that is greater than the amount of conduct money paid and I propose to order that the husband pay a further amount of $7,367.45. Having regard to his financial circumstances, the husband will have 90 days to pay.

Miscellaneous

91 The husband sought leave to extend the time for the filing of material for the upcoming further hearing dates to 26 March 2021. No submissions were made in relation thereto other than to suggest that granting the extension would merely be a formalisation of discussions had between the parties.

92 As no further mention was made of the extension I consider the more appropriate course is to indicate that if the parties agree on 13 April 2021 to the proposed extension then I will grant leave nunc pro tunc.

Associate:



Dated: 22 March 2021

SCHEDULE OF PARTIES

^[1] As defined in the Family Law Rules 2004 (Cth) at r 15.16(1).

^[2] Rigby & Kingston and Ors (No 3) [2020] FamCA 958 citing Rigby & Kingston and Ors (No 2) [2020] FamCA 695 (anonymised).

^[3] Rigby & Kingston and Ors [2020] FamCA 415 at [39] – [44] (“Rigby & Kingston”) (anonymised).

^[4] Ibid at [45] – [50].

^[5] Rigby & Kingston (No 2) [2020] FamCA 695 (anonymised).

^[6] Rigby & Kingston (n 3).

^[7] Ibid.

^[8] Rigby & Kingston (n 3).

^[9] Fordyce v Ryan [2016] QSC 307; (2017) 2 Qd R 240 at 248, [39].

^[10] H Pty Ltd, J Pty Ltd, J Holdings Pty Ltd, L Pty Ltd, M Pty Ltd, Kingston Developments Pty Ltd, N Pty Ltd, Kingston Pty Ltd, Kingston Constructions Pty Ltd, R Pty Ltd, Kingston Group Pty Ltd, O Pty Ltd (in its own right), Q Pty Ltd (in its own right), K Pty Ltd (in its own right) and Kingston Consolidated Pty Ltd (in its own right).

^[11] Exhibit 2.

^[12] Perdaman Chemicals & Fertilisers Pty Ltd v The Griffin Coal Mining Company Pty Ltd (No 6) [2012] WASC 450; Santos Limited and Ors & Pipelines Authority [1996] SASC 5578; (1996) 66 SASR 38.

^[13] See for example X Pty Ltd v Merhi [2015] FamCA 622.

^[14] [1978] 1 NSWLR 372 at 385 (‘National Employers' Mutual v Waind’).

^[15] [2000] FamCA 892; (2000) FLC 93-038.

^[16] National Employers' Mutual v Waind (n 14) at 382.

^[17] [1938] NSWStRp 29; (1938) 38 SR (NSW) 564.

^[18] [2009] FamCA 369; (2009) 243 FLR 409.