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Totorea v Grainger Corporation (Vanuatu) Ltd [1997] SBHC 65; HC-CC 074 of 1995 (5 May 1997)

HIGH COURT OF SOLOMON ISLANDS

Civil Case No. 74 of 1995

JOSEPH RODI TOTOREA

-V-

GRAINGER CORPORATION (VANUATU) LTD & OTRS

High Court of Solomon Islands

Hearing Date: 3rd April, 1997
Judgment Date: 5th May, 1997

A. Radclyffe for the Applicant (ANZ Banking Group Limited)
F. Waleilia for the Respondent/Plaintiff
S. Patrick in attendance for First Defendant

PALMER J.: The ANZ Banking Group Limited ("the Bank") had been issued with a subpoena duces tecum pursuant to the Summons of the Respondent filed on 2nd June, 1995, to attend court:

" . . . from day to day until the above cause is tried, to give evidence on behalf of the plaintiff and also to bring . . . and produce at the time and place aforesaid:

(1) Ledgers;

(2) Bank Statements;

(3) Deposits slips;

(4) Cheques;

(5) All documents affecting international and local transfer of funds,

bearing date on or after the 14th March 1995 affecting the business carried on under the names Honiara Gaming Club and Honiara Casino and also affecting all personnel accounts operated under the name of Andy Ayamiseba, Vince Conte and Sean Gully either jointly or separately" .

The Bank is not a party to the proceedings. It is a stranger, and to that extent any subpoena duces tecum issued must clearly demonstrate in my respectful view that the documents and items sought to be produced are material and relevant to the facts in issue in the proceedings before the court; that is, that they would be used as evidence in the hearing. This in my respectful view must be the underlying guideline as to whether a subpoena duces tecum should be issued or not (see Order 39 Rule 26 of the High Court (Civil Procedure) Rules, 1964). Even if a document has been described with sufficient precision, but if it is not material and relevant, that is, that it cannot be used as evidence or will not be used as evidence, then it should not be made the subject of a subpoena duces tecum, and if so, then the subpoena should be set aside.

The brief background to the issue arising on the subpoena duces tecum can be briefly stated as follows. The Respondent/Plaintiff had applied by Summons filed on 2nd June 1995 for orders inter alia as follows:

"1. That a Receiver be appointed to deal with and manage the operations and assets of the Honiara Gaming Club with power to:

(a) receive and pay monies and or deal with other properties of the Honiara Gaming Club and to account for the monies or other properties of the Honiara Gaming Club until final judgment or further order;

(b) employ and appoint any person to carry on the management and operation of the said business until further order;

(c) investigate and report to this Court on all matters affecting the business operations of the Honiara Gaming Club;

(d) apply to this Court for further or other orders as the circumstances may require.

2. That the Australia and New Zealand Banking Group Limited forthwith make a full and true disclosure of all accounts operated by any of the defendants at the ANZ Bank branches in Solomon Islands."

The Plaintiff had become very concerned about the moneys received and properties of Honiara Gaming Club in that he believed that moneys had been diverted somewhere else and the properties of the Club being transferred to and used by the Honiara Casino Limited. In support of his allegations he filed a number of affidavits sworn by various persons deposing to the fact that deposits had indeed been observed by them to have been made at the Bank contrary to the orders of the court and that properties had been secretly transferred to the newly opened Honiara Casino Limited. (See affidavits of Ben Mo’osimae, Chris Ahikau and Peter Houanihisi all filed on 2nd June, 1995, and affidavit of Joseph Rodi filed on 11th September, 1995). The summons filed above accordingly was an attempt to address the concerns of the Respondent/Plaintiff. However, in order to prove those allegations, he needed to have access to the various bank documents held in the custody of the Bank for inspection and production as evidence before this Court.

What has transpired it appears is that the Bank has declined to make any affidavit when approached by the Respondent/Plaintiff and that he had not had the bankers’ books of the Defendants discovered. Obviously, the Bank not being a party to the case cannot be compelled to reveal their existence and to produce them for inspection by way of discovery. (See Penn-Texas Corporation v. Murat Anstalt and Others (No. 2) 1964 2 All ER 594). The Respondent/Plaintiff therefore comes to this court for relief in the only other way he considers appropriate; by issuing a subpoena duces tecum against the Bank.

On one hand, I do not think this was the most appropriate step to take in the circumstances. Whilst the Respondent/Plaintiff holds the belief that funds may have been diverted from the trust account set up by order of this court, into other accounts, possibly in the names of the Defendants, Honiara Gaming Club or Honiara Casino Limited, he does not know for certain which accounts, if any, such deposits may have been made. In those circumstances, what he should have done was to apply for discovery of the bankers’ books of the Defendants under Order 33 Rules 10 and 17 of the High Court (Civil Procedure) Rules, 1964. This would have also included the bankers’ books pertaining to the Honiara Gaming Club and Honiara Casino Limited, and would have been more than sufficient to address the concerns on access and inspection of the bankers’ books of the defendants, even though the Bank is not a party to the proceedings.

The Respondent/Plaintiff however did not do that, whether due to an oversight or deliberately, is not known. Instead he has opted for a general and broadly worded subpoena duces tecum against the Bank. The issue before me however, is not so much whether the Respondent/Plaintiff should have obtained inspection of those documents by way of discovery, though this in my respectful view is what the Respondent should have done, as to whether the subpoena duces tecum issued should not be allowed to stand as oppressive, a fishing expedition or an abuse of the courts’ process.

As to the question whether the subpoena duces tecum amounted to a fishing expedition, I must answer this in the negative. I am satisfied the Respondent/Plaintiff had produced sufficient affidavit evidence to show that those documents would be required to be used as evidence in the hearing of the Summons filed on 2nd June 1995; bearing in mind that the allegation of the Respondent/Plaintiff was that funds had been dissipated beyond the courts reach by the Defendants. [See Penn - Texas Corporation v. Murat Anstalt and Others (No.2) 1964 2 ALL ER 594 at page 601: "Although the holder of documents, not being a party to an action, cannot be required to reveal their existence or produce them for inspection by way of discovery, he may be served with a subpoena duces tecum or some equivalent order, whereby he is required to attend and produce documents with a view to their use as evidence. They may be required for use as evidence at the trial, or on the hearing of a motion or summons."].

As to the question that the subpoena duces tecum should be refused as an abuse of the courts’ process, in that it seeks to make discovery of documents and that the court would be required contrary to the practice of the court to consider each document one by one to see if it appears to be relevant (see The Australian Digest - Third Edition paragraph 300; & Dingle v. Commonwealth Development Bank of Australia (1989) FCR 63), I do not necessarily agree. Whilst the said documents could as easily have been obtained through discovery by the Respondent/Plaintiff, (in this case they had not been discovered), I am not satisfied in the circumstances that the issue of the subpoena duces tecum amounted to such an abuse. Clearly the documents subpoenaed would be relevant to the issue raised by the Respondent/Plaintiff in his summons and the court would be obliged in the circumstances to consider them. It may transpire that only some, or even none of the documents subpoenaed may become directly relevant at the end of the hearing, but that does not in my respectful view over-ride their relevance and intended use in the hearing of the Respondents’ application. The balance of justice in the circumstances of this case must weigh in favour of allowing the subpoena duces tecum to stand.

On the question of vagueness, I am not satisfied that the subpoena is too vague. The documents required to be produced have been described with sufficient precision and relate to the business carried on under the names of Honiara Gaming Club and Honiara Casino Limited, and the personal accounts of the third, fourth and fifth Defendants. The Honiara Gaming Club is the business which is central to this dispute, whilst the Honiara Casino Limited is the new business which the Defendants started after things turned sour with the Respondent/Plaintiff. With respect, I do not find anything in the description of those documents which would be too difficult or ambiguous for the Bank not to understand.

Having said that, I do find though the terms of the subpoena to be too wide. Not only is it too wide in terms of requiring the production of documents bearing date on or after 14th March, 1995, but that it would include documents relating to Honiara Casino Limited and the Defendants, beyond the date of cessation of business of Honiara Gaming Club. Not all documents subpoenaed after 14th March, 1995 will be relevant. In fact, all documents subpoenaed after the date of cessation of business of Honiara Gaming Club, in my respectful view, would be irrelevant and inadmissible as evidence, unless there is other evidence to show that those documents should also be used as evidence in the hearing of the Respondents’ summons.

Also, anything pertaining to the activities of the Defendants and Honiara Casino Limited after the date of cessation of business of Honiara Gaming Club in my respectful view would be irrelevant.

I find accordingly those parts of the subpoena to be oppressive and an abuse of the Courts’ process. Having said that however, I do not necessarily think that this court should then dismiss this subpoena without considering what the underlying requirements of justice and fairness are, in the circumstances of this case. It is my respectful view that the court can, in the exercise of its inherent jurisdiction, when balancing the scales of justice and in ensuring the fair disposition of the cause or matter before it, on its own volition, give necessary directions as to the ambit of the subpoena duces tecum, failing which the subpoena would be set aside. Such necessary directions in this case must include a cut off point as to the period covered by the subpoena commencing from 14th March, 1995. From the affidavit evidence filed, this should be the date of 31st May, 1995; anything after would be irrelevant and inadmissible.

Another issue raised by learned Counsel, Mr Radclyffe, against the subpoena as well was that it would cause the Bank to disclose to the Respondent/Plaintiff confidential information concerning the financial affairs of their customers. Unfortunately, that private right between the Bank and its customer can be overridden to some extent for the purposes of the administration of justice. That would include the situation where the Bank has been served with a subpoena duces tecum to attend and produce documents for use as evidence in a hearing or trial. (See Penn-Texas Corporation v. Murat Anstalt and Others (No. 2) [ibid]; Maurice Robertson -v- Canadian Imperial Bank of Commerce [1944] 1 WLR 1493; Parry-Jones v. Law Society [1969] 1 Ch. 1, 9 per judgment of Diplock L.J. quoted in A and Others v. B Bank [1992] 3 WLR 705, 716, 717; also see Bank of Crete S.A. v. Koskotas and Others (No. 2) [1989 T. No. 88] [1992] 1 WLR 919, 925, 926.). I am satisfied, in the circumstances of this case, where it is clear that the subpoena had been issued for the production of documents that would be used as evidence in the trial, that this must outweigh the requirements of confidentiality subsisting between the Bank and its customer.

One of the concerns raised by the Bank is the costs it will incur in putting all the necessary documents together and having them available for production before this court. This includes the cost of man-hours that would be expended by the Bank. With respect however, that can be addressed separately when the question of quantum of costs comes to be addressed at the end of the day. The costs in any event of this application and related costs of the subpoena duces tecum must be borne by the Respondent/Plaintiff.

I accept there is substance in the submission that sufficient time should be given to the Bank to attend Court with the documents subpoenaed. This should be a clear 7 working days notice.

ORDERS OF THE COURT:

1. Dismiss summons of the Applicant.
   
2. Direct that the subpoena issued be varied within 7 days to indicate the cut off date as of 31st May, 1995, and filed not later than 14th May, 1997, failing which the subpoena will be set aside.
   
3. That 7 working days notice be given to the Bank to attend Court with the documents.
   
4. Costs of this application and related costs of the subpoena in any event shall be borne by the Respondent/Plaintiff.
   
5. The summons of the Respondent/Plaintiff filed on 2nd June, 1995 be listed for hearing on Wednesday 28th May, 1997 at 2.00 pm or any date thereafter by agreement between the parties and the Court, but not later than 9th June, 1997.
   

THE COURT.