FEDERAL COURT OF AUSTRALIA

Roufeil v Fiore, in the matter of the Bankrupt Estate of Peter Andrew Fiore (No 2) [2019] FCA 916

ORDERS

THE COURT ORDERS THAT:

1.    The matter is adjourned to 9.00 am on Friday 21 June 2019.

2.    The parties are to confer and by 4.00 pm on Thursday 20 June 2019 bring in a minute or minutes of proposed orders reflecting these reasons, including as to costs.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

JACKSON J:

1    This is an application to set aside summonses that were issued on the application of the trustee in bankruptcy of Mr Peter Fiore. I described the background to the application and much of the evidence in Roufeil v Fiore, in the matter of the Bankrupt Estate of Peter Andrew Fiore [2019] FCA 687, and subject to the following, I will not repeat that here.

2    At the beginning of the hearing of the present application, counsel for the respondents indicated that they maintained their objection to all of the summonses issued, not just the summonses issued to them. However they were not in a position to press their objections in relation to the other summonses because they had not been able to gain access to them. Therefore the hearing concerned, and these reasons concern, only the summonses issued to the named respondents. I have not yet dealt with the application in so far as it relates to the other summonses.

3    In these reasons I will, for convenience and meaning no discourtesy, generally refer to individuals with the surname of 'Fiore' by their first names.

Further evidence

4    In addition to the evidence I summarised in the previous reasons, a further affidavit of Ms Hsieh, a solicitor acting for the trustee, was filed on 20 May 2019. It deposes to communications with Peter's former solicitor, Mr Skinner, and says that contrary to a suggestion emerging from Ms Velevski's affidavit, the trustee has not abandoned the summons to Mr Skinner. While that remains in controversy between the parties, it is not necessary to resolve that controversy in these reasons. As I said in my previous decision, I do not consider the evidence establishes any basis to believe that the trustee has sought the summonses for no good reason. In light of that, Ms Hsieh's second affidavit has no bearing on the matters I address in these reasons.

5    I also need to summarise aspects of Ms Hsieh's first affidavit, filed 14 May 2019, in more detail than I did in the previous reasons. It annexes notices, dated 23 March 2016 and 21 September 2017, of objection to the discharge of Peter from bankruptcy, which would otherwise have occurred automatically three years after the filing of his statement of affairs. The trustee submitted the objections to the Australian Financial Security Authority under s 149B of the Bankruptcy Act 1966 (Cth). Together they were based on the following allegations:

(1)    Peter failed to comply with a request for written information about his property, namely particulars of asset disclosures he had previously made. That is a ground contemplated by s 149D(1)(d).

(2)    Peter failed to disclose any particulars of income or expected income in relation to the first three years of the bankruptcy. That is the ground contemplated by s 149D(1)(e). Peter is said to have materially misstated the income he expected to earn as a dentist during the first year and understated his income for the second year. Peter did not comply with a direction to provide details of his expected income during the third year.

(3)    Peter failed to pay the trustee an income contribution that was due under s 139ZG (although, after several demands, Peter's employer paid the contribution). That is a ground contemplated by s 149D(1)(f).

(4)    Peter failed to comply with a direction to surrender his passport. That is a ground of objection contemplated by s 149D(1)(ia). Peter nevertheless made several requests for permission to travel overseas, which the trustee refused 'because I require the Bankrupt to remain in Australia to comply with his income disclosure and compulsory income obligations. He has been in continual default and I consider him a flight risk'.

(5)    Peter failed to inform the trustee of a change of address. That is a ground of objection contemplated by s 149D(1)(j).

6    As a result of the notices, the discharge date for the bankruptcy was extended by five years to 20 December 2021.

7    At the hearing the respondents sought to tender a letter dated 30 October 2017 from the Inspector-General in Bankruptcy from which it appears that an assessment of Peter's income made by the trustee was set aside. The detail contained in the letter raises several issues of fact where, in my view, it would cause prejudice to the trustee for me to admit the letter into evidence without giving him an opportunity to respond. There is no indication of why the letter was only produced at the start of the hearing. The hearing was held in the context where the examination summonses are now due to commence on 7 August 2019 and there is an increasingly pressing need to resolve the issues around the summonses so as to avoid further inconvenience and cost to all concerned. I will not admit the letter into evidence.

8    In the absence of the letter, there is little evidence as to whether Peter challenged the objections or what the outcome of any such challenges were. The bankruptcy has been extended, so at least some of the objections were not challenged, or were not challenged successfully. An extract from the National Personal Insolvency Index that was annexed to Ms Velevski's affidavit indicates that an objection under s 149D(1)(f), which is the alleged failure to pay an income contribution, was cancelled, so I place no weight on that objection. Counsel for the trustee was not able to shed any light on why the cancellation occurred. The extract records the result of the other objections as either 'No data held' or 'Filed'. Given that the term of the bankruptcy has been extended, I infer that the objections that are shown as filed, at least, were not challenged, or not challenged successfully. These are objections on the basis of failure to disclose property or income, failure to surrender Peter's passport, and failure to notify of a change of address.

9    The purpose of adducing evidence of the objections, counsel for the Trustee submitted, was to establish that 'this does not fall within what one could classify as a standard bankruptcy, and that there has been some level of delinquency on the part of the bankrupt'. I accept that this is a matter relevant to the exercise of my discretion as to whether to set aside the summonses. But it is not a matter on which I place a great deal of weight. Any bankruptcy in which the trustee has gone to the trouble and expense of procuring the issue of summonses for examination is not a 'standard bankruptcy'. There is therefore no reason to suppose that the trustee is investigating other than for good reason. Good reason to investigate is likely to include at least a reasonable suspicion of delinquency on the part of the bankrupt.

10    I emphasise I make no finding of delinquency - the finding is that there is something worth investigating. I do not consider that the objections lodged by the trustee take the point any further than that. As will be seen, I consider that in several places the summonses that have been issued are much wider than can be justified by such an investigation. In the circumstances the presence of the objections does not provide any compelling reason to leave the summonses untouched.

The legislation

11    The summonses were issued under s 81 of the Bankruptcy Act. The following subsections are relevant here:

Discovery of bankrupt's property etc.

(1)    Where a person (in this section called the relevant person) becomes a bankrupt, the Court or a Registrar may at any time (whether before or after the end of the bankruptcy), on the application of:

(a)    a person (in this section called a creditor) who has or had a debt provable in the bankruptcy;

(b)    the trustee of the relevant person's estate; or

(c)    the Official Receiver;

summon the relevant person, or an examinable person in relation to the relevant person, for examination in relation to the bankruptcy.

(1A)    A summons to a person by the Court or the Registrar under subsection (1) shall require the person to attend:

(a)    at a specified place and at a specified time on a specified day, being a place, time and day that are reasonable in the circumstances; and

(b)    before the Court or the Registrar or, if the Court or the Registrar thinks fit, a magistrate;

to be examined on oath under this section about the relevant person and the relevant person's examinable affairs.

(1B)    A summons to a person under subsection (1) may require the person to produce at the examination books (including books of an associated entity of the relevant person) that:

(a)    are in the possession of the first-mentioned person; and

(b)    relate to the relevant person or to any of the relevant person's examinable affairs.

(1C)    Before summoning a person on an application under subsection (1) by a creditor, the Court or the Registrar, as the case requires, may impose on the applicant such terms as to costs as it, or he or she, thinks fit.

(2)    An examination under this section shall be held in public.

(3)    The Court, the Registrar or a magistrate may at any time adjourn the examination of a person under this section either to a fixed date or generally, or conclude the examination.

…

(10)    The Court, the Registrar or the magistrate may put, or allow to be put, to a person being examined under this section such questions about the relevant person or any of the relevant person's examinable affairs as the Court, the Registrar or the magistrate, as the case may be, thinks appropriate.

…

(11)    A person being examined under this section shall answer all questions that the Court, the Registrar or the magistrate puts or allows to be put to him or her.

12    Section 5 defines 'examinable person', in relation to the relevant person, to mean, relevantly:

…

(b)    if the relevant person has become a bankrupt and any of the property of the bankrupt is known or suspected to be in the possession of a person - that person;

(c)    in any case - a person who is believed to be indebted to the relevant person;

(d)    if a person, including:

(i)    a person who is an associated entity of the relevant person; or

(ii)    a person with whom an associated entity of the relevant person is or has been associated;

may be able to give information about the relevant person or any of the relevant person's examinable affairs - that person; or

(e)    if books (including books of an associated entity of the relevant person):

(i)    are in the possession of a person, including a person of a kind referred to in subparagraph (d)(i) or (ii); and

(ii)    may relate to the relevant person or any of the relevant person's examinable affairs;

that person.

13    'Examinable affairs' is defined in s 5 to mean, in relation to a person:

(a)    the person's dealings, transactions, property and affairs; and

(b)    the financial affairs of an associated entity of the person, in so far as they are, or appear to be, relevant to the person or to any of his or her conduct, dealings, transactions, property and affairs.

14    'Associated entity' is relevantly defined in the same section to mean, in relation to a person, an entity (other than a company) that is, or has been, associated with the person. Entity is defined to include a natural person.

15    In Turner (Trustee) v Ackerman; in the matter of Schipper (Bankrupt) [2003] FCA 679 at [17] Gray J held that these definitions are broad and should not be construed restrictively.

Principles

16    In Karounos v Official Trustee (1988) 19 FCR 330 at 335-336 the Full Court of this court set out the following principles, which are relevant to the present application:

1.    The power given by s 81 of the Act is an unusual and far-reaching one (Re North Australian Territory Company (1890) 45 Ch D 87 at 93; Ex parte Willey (1883) 23 Ch D 118 at 128) and its use could easily become oppressive and vexatious if it is not approached responsibly by applicants for summonses, and controlled carefully by the Registrar and the court: see Re Price (No 3) (1948) 14 ABC 137 at 139-140.

2.    However the power is exercised in the interests of creditors, and those interests should not be defeated by an unduly technical or restrictive approach to the use of the power. The procedure is basically designed to establish what assets the bankrupt had, what has happened to those assets, and whether action should be begun (or continued) to recover them: see Re Price (No 4) (1948) 14 ABC 142 at 144; Re Andrews (1958) 18 ABC 181 at 184; Re Poulson [1976] 1 WLR 1023 at 1032; [1976] 2 All ER 1020 at 1029.

…

4.    The summons itself should be expressed in terms which make the intended areas of inquiry as clear as the circumstances of the case permit, and which specify as clearly as possible any books and records which the person summonsed has to produce: see Re Andrews (supra) at 186-187.

5.    The Registrar should examine the application and form of summons carefully to satisfy himself that the grounds of the application are sufficiently clear and the form of the summons is not oppressive or vexatious, by reason of being uncertain, too wide or otherwise objectionable.

6.    If the application and summons are in proper form (in the sense just indicated) the Registrar should issue the summons. He is under no duty to inquire whether there may be some further circumstance which would make compliance with the summons oppressive for a particular person, or at a particular time, or with regard to particular books or records.

7.    If a person summoned believes that compliance with the summons would be oppressive or vexatious, he can apply to the court to have the summons set aside or adjourned to a more convenient time. Such an application to the court will usually be determined on a broad view of the issues in the particular case and a weighing of competing principles: see Re Castle New Homes Ltd [1979] 1 WLR 1075; 2 All ER 775 and cases there cited; Re John Arnold's Surf Shop (supra); Re Nalanda Pty Ltd [1983] 1 Qd R 269.

…

12.    Both the Registrar and the court will give due weight to the fact that a summons is sought by the Official Trustee, who will not be presumed to have acted unfairly or for an improper purpose except on convincing evidence: Re Price (No 3) (supra) at 141. The same is true of an official liquidator: see Re Castle New Homes Ltd (supra) at 791; Re John Arnold's Surf Shop (supra) at 229-230. But an application by the Official Trustee will still be subject to proper scrutiny and will be refused if the Registrar or court is not satisfied that it should be granted.

17    In Sheahan (Trustee) v Scott, in the matter of Livingstone [2003] FCA 141, Hely J held at [18]:

There is nothing in the Federal Court Rules which requires disclosure of the areas of enquiry intended to be covered at the examination, nor is there any provision in the prescribed form of summons for inclusion of that information. By force of s 81(1A) and 81(10) of the Act, the permissible scope of an examination is asking appropriate questions about the bankrupt, or the bankrupt's examinable affairs.

18    And at [28]:

The examination is for a proper purpose if it relates to the bankrupt's "examinable affairs". The "examinable affairs" of the bankrupt include his property and affairs, as well as the financial affairs of any person associated with the bankrupt, insofar as they are or appear to be relevant to the bankrupt, or his property or affairs.

19    At [38] his Honour observed that it is not to be assumed that the trustee is acting for an improper purpose.

20    It is incumbent upon an examinee to adduce further evidence if that person is to impugn successfully the validity of the examination order, particularly as to any discretionary elements: Re Southern Equities Corporation Ltd (in liq); Bond v England (1997) 140 FLR 202 at 220.

21    In Grosvenor Hill (Qld) Pty Ltd v Barber (1994) 48 FCR 301 at 311-312 the Full Court held:

However, in the final analysis, it must be left to the Court in any particular instance, guided by the evident statutory purpose of the section, to determine whether or not the information is relevant to the liquidator for the purpose of performing his statutory duty and whether and in what manner any proposed examinee needs to be safeguarded beyond the ordinary safeguards of court control of the examination process from any oppressive exercise of the power.

Consideration

Summons to Liliana Fiore

22    It is necessary to set out the text of the operative part of the summons to Liliana:

You are required to attend before a Registrar at the time, date and place shown in the Notice of Filing and Hearing attached to be examined on oath under section 81 of the Bankruptcy Act 1966 and to give evidence in relation to the examinable affairs of Peter Andrew Fiore (A Bankrupt).

You are also required to attend at any time, date and place to which the examination is adjourned if you have been given written notice of that time, date and place. You are also required to bring with you the books listed on the next page and produce them at the examination.

If you do not comply with this summons, a warrant for your apprehension (arrest) may be issued under section 264B of the Bankruptcy Act 1966. However, a warrant will not be issued if you were not given a reasonable amount for expenses.

Books required for production

You must bring the following books with you and produce them at the examination:

1.    All bank statements for the period from 1 October 2008 to 20 August 2018 of bank accounts in your name or for which you are or were signatory or an authorised user.

2.    All documents (whether electronic or hardcopy) in your possession or control containing information relating to Peter Fiore and:

(a)    His assets;

(b)    His financial circumstances;

(c)    Mr Carmello Fiore's will and probate;

(d)    The wider Fiore family's assets which Peter Fiore may have access to;

(e)    All dealings, transactions, property and affairs with Peter Fiore; and

(f)    Loans, gifts or payments made to or for Peter Fiore during the period 13 October 2013 to the present date.

3.    All documents produced during the period from 23 October 2013 to 20 August 2018, including but not limited to file notes, invoices, receipts, diary notes, minutes of meetings or any record of conversations, (whether electronic or hardcopy) and correspondence relating to C. Fiore Nominees Pty Ltd (ACN 008 834 820).

Paragraph 1 of the summons

23    Liliana submits that paragraph 1 of the summons is not authorised by s 81(1B)(b) of the Bankruptcy Act as it does not seek production of documents which 'relate to the relevant person or to any of the relevant person's examinable affairs'. Cooper J accepted a similar argument in Re Osenton; Ex parte Osenton v Worrell [1995] FCA 90 at pp 36-37. His Honour did so on the authority of Federal Commissioner of Taxation v Australia & New Zealand Banking Group Ltd (Smorgon) (1979) 143 CLR 499.

24    Smorgon concerned the exercise by the Commissioner of Taxation of his power under s 264(1) of the Income Tax Assessment Act 1936 (Cth) to issue a written notice requiring a person to attend and give evidence and produce documents. The High Court held that this power was subject to the limitation that the evidence and documents had to concern the income or assessment of the recipient of the summons, or another identified taxpayer. If the written notice did not show the recipient that the documents required to be produced were ones which the Commissioner had power to require, then the notice would not be valid: see at 525 (Gibbs ACJ) and 537-538 (Mason J).

25    On the basis of that principle, the High Court held that some of the notices that the Commissioner had issued were valid and some were invalid, although the court was not unanimous on all points. Some of the notices sufficiently expressed the necessary connection between the documents sought and the income or assessments of identified taxpayers. One was invalid because it did not refer to any taxpayers at all. Another notice, which had been issued to the bank, was closer to the terms of the summons to Liliana than the other notices in Smorgon. It referred to the income and assessment of named taxpayers, and went on to require production of books in specified safe deposit boxes. It did not say that the documents in the safe deposit boxes had any connection with the income and assessment of the taxpayers. Gibbs ACJ did not find it necessary to rule on the validity of that notice, but Mason J held that it was invalid, because it did not in any way assert that the documents related to the income or assessment of the named persons: Smorgon at 538, Jacobs J agreeing at 541 and Murphy J agreeing at 547.

26    I respectfully agree with Cooper J in Re Osenton that the principle identified in Smorgon must be applied to summonses issued under s 81 of the Bankruptcy Act. It is clear on the wording of the section and the authorities to which I have referred above that the power of the court to issue summonses under that provision is relevantly limited to require production of documents that are in the possession of the recipient and relate to the bankrupt or any of the bankrupt's examinable affairs: see in particular s 81(1B). In s 5 of the Bankruptcy Act 'in the possession of' is defined to include 'in the custody of or under the control of'.

27    The summons to Liliana in the present case does expressly confine the evidence to be given by Liliana to evidence about the examinable affairs of Peter. It therefore goes further than the entirely uninformative notice I have already described which the High Court held to be invalid. But it does not expressly draw any connection between those affairs and the documents, production of which it purports to require. It may be argued that the connection is tolerably clear on the face of the document - why else would the trustee want to see those documents? However in my view, which I have reached with some hesitation, that is not enough.

28    First, in Re Osenton Cooper J set aside summonses which, like the summons to Liliana, did refer to the examinable affairs of the bankrupt, but did not draw any express connection between those affairs and the documents required to be produced. I am required to follow his Honour's approach unless I consider it to be clearly wrong which, with respect, I do not.

29    Second, as I have said, the High Court held to be invalid a form of notice which was relevantly similar to the notice to Liliana, in that it did refer to the subject matter of the investigation which animated the power to require attendance to give evidence, but it did not expressly draw any connection between that subject matter and the requirement to produce specified documents.

30    Third, and fundamentally, it must be recalled that the power of the trustee to seek the issue of summonses needs to be approached responsibly by applicants for summonses, and controlled carefully by the court. I am conscious that an unduly technical and restrictive approach to the power should not be taken, but at the same time it must be recalled that the summons is issued on pain of contempt of court, and it is well established that it should be expressed in terms that specify as clearly as possible any books and records which the person summonsed has to produce: Karounos at 335. That is especially so where the recipient of the summons is not the bankrupt: see Re Andrews (1958) 18 ABC 181 at 186-187.

31    That being so, I do not consider that the trustee should be given the benefit of the doubt here where he has not clearly drawn the necessary connection between the documents to be produced and the bankrupt's examinable affairs. In failing to do so, he has procured the issue of a summons which, in terms, will expose the recipient to penalties if she fails to produce certain documents, even if those documents have nothing to do with the bankrupt or his examinable affairs.

32    For those reasons, in my view the summons is invalid in so far as it requires production of the bank statements described at paragraph 1 of the list of books required for production.

33    It may also be observed that paragraphs 1 and 3 of the summons do not on their face recognise another limitation on the power which s 81(1B) expressly imposes, namely the requirement that the documents to be produced be in the possession of the recipient: see Re Osenton at p 36. However as the respondents did not make any objection on that ground, I will not decide their application on that basis.

34    Apart from the form of the summons, Liliana submits that a requirement to produce all bank statements in her name for a ten year period is oppressive because it is too wide. I do not accept that. The trustee wishes to investigate the affairs of family members of Peter in order to discern whether or not income or assets which are, in truth, his have been concealed in or directed through the bank accounts of those family members. The trustee points to the alleged misstatement of Peter's income and his failure to provide particulars of his assets which are the subject of the notices of objection to discharge of his bankruptcy. It is enough to say that it is an area into which the trustee may legitimately inquire. On their face, it is also legitimate for those inquiries to go back five years before the commencement of the bankruptcy, which this requirement does. I will not lightly conclude that the trustee is investigating that far back for no good reason.

35    There is no evidence as to the number of bank statements this would require Liliana to produce or any difficulty in locating or identifying them. Submissions filed on her behalf point out that she is 82 years old, but there is no evidence that this leads to any infirmity which would impair her, or those acting on her behalf, from producing the bank statements. Balancing the statutory purpose of the power conferred by s 81 of the Bankruptcy Act against the need to ensure that the power is not exercised oppressively, I consider that the requirement to produce bank statements over the ten year period has not been shown to be oppressively wide. The respondents claim that the trustee is fishing, but the s 81 process is available for that purpose: see Re Rothwells Ltd (No 2) (1989) 15 ACLR 168 at 182 (Nicholson J), a case concerning the power to issue summonses in corporate insolvency, but the principle is the same.

36    Certainly, if the paragraph had been limited by appropriate words confining it to the scope of the power granted by s 81 of the Bankruptcy Act, that would have required Liliana to form a judgement which could be difficult to make. That is, she may not know whether or not a given bank statement of hers contains information relevant to Peter or his examinable affairs. However in my view the class of documents required - bank statements over a specified period - is sufficiently definite so that she will be capable of identifying and producing documents that potentially answer the summons. Whether she wishes to withhold any of those bank statements and take the risk that they are subsequently shown to have related to Peter or his examinable affairs is a matter for her.

37    The dilemma thus produced is a real one, but it is an inevitable product of the way the legislation is framed: see Smorgon at 510 (Stephen J, overturned in part but not on this point); 523 (Gibbs ACJ); 537 (Mason J). It would be a mistake to approach a relationship which by reason of s 81 must be expressed in the summons as itself introducing uncertainty which vitiates the summons. That would frustrate the purpose of s 81 which is to help a trustee in bankruptcy investigate the affairs of the bankrupt. It would place an impossible burden on the trustee to require him to require production only of specified documents which he is sure relate to the bankrupt or his examinable affairs: see in particular Mason J at 537. This consequence of the particular legislation illustrates why caution is required in the application of principles developed in a different context, such as subpoenas for production of documents. My view might be different if the class of potentially relevant documents were indeterminate or unduly large, but in the case of the bank statements, for the reasons I have given, it is not.

Paragraph 2 of the summons

38    Taking the broad view of the issues mandated by Karounos, I consider that paragraph 2 of the summons is too wide. It must be remembered that if Liliana fails to comply with the summons, she will be guilty of contempt of court. With that in mind, and in accordance with the principles I have summarised above, it is incumbent on the Trustee to ensure that the summons is framed with sufficient precision both to make the scope of what is sought clear, and to make the burden of compliance reasonably proportionate to the purpose of the Trustee in conducting the examination.

39    Liliana is Peter's mother and has known him for over 58 years. On its face, paragraph 2 requires production of every document in Liliana's possession containing information relating to Peter. It is not necessary to strain the natural meaning of the paragraph, for example, to conclude that it requires Liliana to produce Peter's baby photos and school reports. It is not abundantly clear that this requirement is limited by sub-paragraphs (a) to (f), but assuming that it is, that is no limitation at all, especially in view of the breadth of paragraph 2(e), which extends to '[a]ll dealings, transactions, property and affairs with Peter Fiore'. That is impermissibly wide. It goes beyond the purpose of s 81 and is oppressive. I can conceive of no possible justification for the trustee needing to see such a wide range of documents. The trustee submitted that the import of the paragraph was a reference to financial or commercial dealings or transactions but that limitation does not appear in the words of the summons. The recipient of a summons should not be put at risk of contempt of court by an ambiguously drawn and extremely broad description of documents.

40    Only sub-paragraph (f) contains any temporal limitation. Nevertheless, in a letter dated 9 May 2019 the solicitors for the trustee informed Ms Velevski that all the documents sought relate to the period from 13 October 2013 to the present date. There is no explanation as to why the limitation thus proffered was not already in the summons. It was part of an attempt at conferral about the scope of the summonses which did not result in any resolution or confinement of their scope, so it is not clear what the trustee's present intentions are as to the limitation. In any event, the summons has not been amended. The presence of the temporal limitation in (f) tends to confirm that the rest of paragraph 2 is unlimited as to time. The summons has the effect of an order of the court and Liliana will be in contempt if she does not comply with its terms. In those circumstances, I cannot have regard to the limitation proffered in the letter.

41    The lack of any temporal limitation means, once again, that it does not stretch the ordinary meaning of sub-paragraph 2(a), concerning Peter's assets, to conclude that it requires production of photographs containing his childhood bicycles or toys. As absurd as that would be, the absurdity is a product of the breadth of the summons. It is not incumbent on a recipient of a summons to read into it an implied limitation that a document be produced only if it is sensible to do so.

42    Liliana complains that paragraph 2(b) is oppressive because she is required to apply her judgement and skill in determining what is meant by financial circumstances that relate to Peter. In my view, however, the meaning of the term is sufficiently clear. Some degree of judgement will always be necessary when it is necessary to apply such a term to documents that exist in the real world, and it is no objection to a summons that a recipient must exercise that judgement in deciding what needs to be produced under it.

43    The respondents relied on a passage from the judgment of Lord Denning MR in Rio Tinto Zinc Corporation v Westinghouse Electric Corporation [1978] AC 547 at 562, where his Lordship observed that the words 'relating thereto' in certain letters rogatory 'cast the net too widely'. But that observation was specific to the wording of the letters in that case. I do not consider that it is authority for any general proposition that the connective terms 'relating to' or 'relate to' are not to be used in summonses or subpoenas: see Spencer Motors Pty Ltd v L & C Industries Ltd [1982] 2 NSWLR 921 at 929. After all, that is the terminology used in s 81(1B) itself.

44    I also do not consider that any assistance is to be gained by seeking to characterise the summonses, as the respondents did, as akin to discovery. When that criticism has been made of subpoenas for production of documents (the function of which is different to bankruptcy examination summonses), the focus is usually on the unfairness of requiring a stranger to the litigation to know what the issues in the litigation are: see generally Southern Pacific Hotel Services Inc v Southern Pacific Hotel Corp Ltd [1984] 1 NSWLR 710 at 717-721. That concern is not relevant in the present context.

45    More to the point is whether the request is too wide. What is to be avoided is, in the words of Jordan CJ, requiring a 'stranger to the cause' from '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': Commissioner for Railways v Small (1938) SR (NSW) 564 at 573 (emphasis added), which was applied in the present context in Re Andrews. If the class of documents covered by paragraph 2(b) were otherwise sufficiently confined, I do not consider that having to form a view as to whether they relate to Peter's financial circumstances would render the paragraph invalid. The problem here is that the class is not sufficiently confined.

46    Liliana has also complained about the requirement to produce the will and probate of her late husband. It is said that the will and probate can be obtained from the probate registry for a small fee. This is part of paragraph 2, which for the reasons I have given is too wide. However if the requirement were to stand alone, I would not set it aside. In fact, the requirement is to produce all documents relating to Mr Carmello Fiore's will and probate. If there were evidence that this was a large category of documents unlikely to be relevant to Peter's examinable affairs, then it may be liable to be set aside. But no such evidence has been put before me. Since there is obviously potential for assets of the late Mr Fiore's estate to have passed to Peter or to his use, it is a legitimate area of inquiry. It is no objection to a summons of this sort that the trustee may be able to obtain a possibly small subset of the documents summonsed by other means. Nor is it any objection that the summonses issued to other recipients also require production of that category of documents. Each individual may have a different set of documents answering that description in his or her possession, and there is no requirement that documents must be summonsed from one recipient only. I therefore do not accept the complaint made about the will and probate.

47    Liliana further complains that paragraph 2(d) is oppressive because it is meaningless. She complains in particular of the terms 'wider Fiore family', 'assets' and 'access to'. I do not accept that the word 'assets' is meaningless. Like 'financial circumstances', it is an ordinary English term with a stable meaning. But I do consider that requiring production of documents relating to assets of the 'wider Fiore family' is too vague. It is impossible to draw any boundary around that term. I also consider that requiring Liliana to form a judgement about whether an asset is one which Peter 'may have access to' (emphasis added) is vague and too wide.

Paragraph 3 of the summons

48    Liliana complains that paragraph 3 of the summons suffers from the same defect as paragraph 1, in that it does not in terms relate to Peter or his examinable affairs. For the reasons I have given in relation to paragraph 1, I agree that it is deficient and liable to be discharged. That is so even if one reads the words at the end, 'relating to C. Fiore Nominees Pty Ltd' as limiting all the preceding words, something which the syntax of the paragraph leaves open to doubt.

49    Ms Velevski's affidavit gave hearsay evidence to the effect that Liliana and Peter do not co-mingle their financial affairs. As to that, it is sufficient to say that whether that is so is a legitimate area of inquiry for the trustee. The same may be said in relation to the general evidence that Peter has had little to do with Giuseppina since their separation, and that he has not co-mingled his affairs with those of Ms Hogan.

50    The trustee submitted that it was relevant that the registrar in this case had examined the application for the summonses and had issued the summonses. However counsel for the trustee disavowed any suggestion that this was an attempt to rely indirectly on the contents of the trustee's affidavit in support of the summons. In any event, I consider that my task is to make rulings after my own review of the merits of the summonses.

Summons to Giorgia Fiore

51    There are several similarities between the summons to Liliana and the summonses to other members of the family so, having dealt with Liliana's summons in some detail, I can be briefer in relation to the others. However the wording of the summonses and the complaints about them in the circumstances of each individual are not exactly the same so it will be necessary to descend to detail at certain points.

Paragraphs 1 and 3 of the summons

52    Paragraphs 1 and 3 of the summons to Giorgia are relevantly similar to, and suffer from the same defect as, the corresponding paragraphs of the summons to Liliana.

53    Giorgia also complains that she was ten years old at the commencement of the ten year period covering the bank statements. But in my view, if the bank statements relate to Peter or his examinable affairs, the age of the account holder or signatory at the time of their issue is not relevant.

Paragraph 2 of the summons

54    Paragraph 2 of the summons to Giorgia is similar to paragraph 2 of the summons to Liliana. In one sense it is wider, as it requires production of documents relating to Carmello Fiore's estate, not just his will and probate. And it is entirely unconstrained as to time. While Giorgia has not known Peter for all of his life, she has known him for all of hers. I consider paragraph 2 of the summons to Giorgia to be too wide, and adopt my reasoning in relation to paragraph 2 of the summons to Liliana.

Summons to Jonathan Fiore

55    The summons to Jonathan is relevantly similar to the summons to Giorgia, and he makes the same submissions as she does. I reach the same conclusions on those submissions.

Summons to Kathryn McKelt

Paragraph 1

56    This paragraph of the summons to Ms McKelt seeks bank statements in the same terms as paragraph 1 of the summons to Liliana. It is defective for the same reasons.

Paragraph 2

57    While this paragraph is similar in some ways to paragraph 2 of the summons to Liliana, it is also materially different. It is limited in time to a period commencing on the date of the bankruptcy and ending on 20 August 2018. Some of its sub-paragraphs are confined to specific matters such as dealings with a specified company or specified property.

58    Ms McKelt complains about sub-paragraph 2(ii), which requires production of documents containing information relating to Peter and '[f]inancial transactions with associated individuals or entities in Australia and overseas'. Ms McKelt submits that the summons should state which individuals or entities it refers to. I do not accept that it is necessary in all circumstances to name the individuals and entities. Specifying them by description or class rather than name may be sufficient to identify what needs to be produced. Also, the term 'associated entity' is used and defined in the Bankruptcy Act and, by force of that and the use of that term in the definition of 'examinable affairs', accurately denotes a concept which, in any event, would limit the scope of the summonses: s 5. But in view of the width of paragraph 2 generally, to which I have referred, I agree that its use in this context is too vague and too wide.

59    Ms McKelt also complains of paragraph 2(vi) which, subject to the temporal limitation, is materially in the same terms as paragraph 2(e) of the summons to Liliana. Despite the temporal limitation, in my view it is too wide. Ms McKelt is Peter's fiancé. Even within a five year period, she can be expected to have had a large number of 'dealings' with him. The trustee asserts that the term 'affairs' in this paragraph is limited to financial affairs, but once again no such limitation appears in the words of the summons.

60    As Ms McKelt does not complain about the balance of paragraph 2, my conclusions about it go no further. But I must say that it is poorly drafted and therefore ambiguous. The ambiguity is in the chapeau, which requires production of:

All documents produced during the period from 23 October 2013 to 20 August 2018, including but not limited to file notes, invoices, receipts, diary notes, minutes of meetings or any record of conversations, (whether electronic or hardcopy) in your possession containing information relating to Peter Fiore … :

61    The ambiguity arises because it is not clear whether the words 'containing information relating to Peter Fiore' qualify the opening phrase, 'All documents produced during the period from 23 October 2013 to 20 August 2018', or whether they only qualify the words on and from 'including but not limited to'. If it is the latter, the class of documents would be unlimited, save as to time. On balance I consider that the former construction is probably the correct one, because the words 'in your possession' are likely to qualify the opening phrase, and if so the rest of the chapeau probably also qualifies that phrase. But if the result of this application is that the summons is to be amended, then the drafting should be improved.

Paragraph 5

62    Ms McKelt also complains of paragraph 5 of the summons to her, which requires production of her income tax returns for the financial years ending 30 June 2013 to 30 June 2018. This suffers from the same deficiency as paragraphs 1 and 3 of the summons to Liliana, in that it is not limited to books relating to Peter or his examinable affairs. It should be set aside. Apart from that, I see no reason to conclude that it is too wide.

Summons to Marina Hogan

63    This summons contains one paragraph as to documents which is materially the same as paragraph 2 of the summons to Liliana. It is unconstrained as to time. Ms Hogan is Peter's sister and has known him for a lifetime. For the reasons given in relation to paragraph 2 of the summons to Liliana, the paragraph is too wide and, in places, vague, and should be set aside.

Summons to Giuseppina Fiore

Paragraphs 1 and 3

64    Giuseppina objects to these paragraphs on the same basis as that for Liliana's objections to paragraphs 1 and 3 of her summons. For the same reasons as given in relation to Liliana, I uphold the objection.

Paragraph 2

65    Paragraph 2 of the summons to Giuseppina reads as follows:

All documents produced during the period from 23 October 2013 to 20 August 2018, including but not limited to file notes, invoices, receipts, diary notes, minutes of meetings or any record of conversations, (whether electronic or hardcopy) in your possession containing information relating to Peter Fiore and:

(a)    His assets;

(b)    Financial transactions with associated individuals or entities in Australia and overseas;

(c)    Insurance policies he held or holds including health, life, income, home and contents and other assets;

(d)    Financial statements of associated entities jointly or severally controlled by and with Peter Fiore;

(e)    Financial statements and records of maintenance arrangements; and

(f)    All dealings, transactions, property and affairs with Peter Fiore.

66    While this is similar in some ways to paragraph 2 of Liliana's summons, there are important differences. The paragraph above is limited as to time from the date of the bankruptcy to 20 August 2018. To that extent, it is closer to the summons to Ms McKelt. But there is an important difference in circumstances, in that Ms Velevski has deposed that Peter and Giuseppina have had little to do with each other since 2012. Once again, whether that is so is a legitimate area of inquiry for the trustee. But accepting that evidence for present purposes means that paragraph 2 is not as potentially wide as the equivalent paragraph in the other summonses.

67    For that reason, I do not find that paragraphs 2(a), 2(b), 2(c) and 2(d) are too wide. However I make the following findings about the balance of paragraph 2:

(1)    Paragraph 2(e) - requiring production of information 'relating to Peter Fiore and … financial statements …' is too vague;

(2)    Paragraph 2(f) - even allowing for the limited contact between Peter and Giuseppina since 2012, this is too broad.

68    I make the same observations about the chapeau as I made about the chapeau to paragraph 2 of the summons to Ms McKelt.

Paragraph 4

69    This paragraph reads, relevantly, as follows:

All documents (whether electronic or hardcopy) in your possession or control containing information relating to an attempted purchase of a property at City Beach Western Australia and District Court of Western Australia, proceeding number 2321/2017, including but not limited to:

(a)    Correspondence between you and Lawton Lawyers;

(b)    Correspondence between your representative or Peter Fiore and Lawton Lawyers;

(c)    Correspondence between you or your representative or Peter Fiore and Euro Corporate Securities in regard to the attempted purchase of the property;

(d)    Correspondence between you or your representative or Peter Fiore and Euro Corporate Securities in regard to the District Court proceeding;

(e)    Transfer of funds between you, your representative or agent or Peter Fiore in regard to the attempted purchase of the property, subject of the District Court proceeding;

(f)    Transfer of funds between you, your representative or agent or Peter Fiore in regard to the District Court proceeding; and

(g)    Source of the funds for the purchase or settlement of the District Court proceeding; and

(h)    Details of any financial arrangement associated with the purchase.

70    Paragraph 4(a) draws no link with Peter or his examinable affairs, and for the reasons I have given it is invalid.

71    Giuseppina also complains about paragraphs 4(g) and 4(h) because they are said to be vague. However I consider that the fact that they are limited to a specified transaction and proceeding means that they are sufficiently precise. I would not set them aside.

Summons to Peter Fiore

Paragraph 1

72    Peter objects to paragraphs 1(c), 1(d) and 1(e) of the summons served on him. These paragraphs require production of documents in the period 23 May 2013 to 20 August 2018 relating to Peter's 'dealings with' three named proprietary limited companies. He submits that 'dealings' is too vague. I do not accept that. It may be accepted that the breadth of the term 'dealings' effectively requires Peter to produce every document in his possession relating to those companies that was produced in the specified period. But in view of the other limitations on the scope of the sub-paragraphs, and in the absence of evidence to the contrary, in my view it will not be unduly difficult for Peter to determine whether or not a given document is required to be produced.

Paragraph 3

73    Peter objects to this paragraph because it is not, in terms, limited to him or his examinable affairs. However he is in a different position to the other recipients, as he is the 'relevant person', to use the terminology of s 81(1B)(b). The paragraph requires production of documents in 'your possession or control'. That requirement being addressed to the bankrupt, on its proper construction the required limitation does appear on the face of the summons: see Smorgon at 525 (Gibbs ACJ).

74    Peter also objects to certain sub-paragraphs because they require production of documents going back up to six years before the bankruptcy. However the documents required are limited both as to category (financial statements, tax returns and bank statements), and by reference to a specified trust. In the absence of evidence establishing that this is nevertheless oppressively wide, I do not find that it is.

Paragraphs 4 and 5

75    Peter objects to paragraphs 4 and 5 because they are not confined by any temporal limit. But they are each confined by reference to specific transaction with a specified entity. I do not consider them to be too wide.

Paragraphs 6(e), 6(f) and 6(g)

76    These paragraphs relate to the same transaction and proceeding as paragraph 4 of the summons to Giuseppina. The complaints are all about vagueness. Once again, I consider that the limitation of the scope of the paragraph to a particular transaction and proceeding means that they are sufficiently precise. I would not discharge them.

'Relating to'

77    Peter also objects to the use of the term 'relating to' in each of paragraphs 4, 5 and 6. For the reasons I have given, I do not consider that term is objectionable by itself and given the way those paragraphs are otherwise confined I do not consider that it is objectionable in context either.

Orders

78    All parties accepted that the court has power to amend the summonses rather than discharge them completely. There is some support for that in first instance decisions of this court including Re Pesic, D & Official Trustee in Bankruptcy v Ex parte Pesic, D & Anor [1987] FCA 83 at pp 11-12, Re Aitken; Ex parte Trans Tasman Timbers Pty Ltd (1988) 17 FCR 71 at 78, Re Florance, JL Ex parte Hardiman, PN v Andrew, WE [1992] FCA 50 at pp 19-20, and Re Osenton at pp 36-38.

79    However it is apparent from these reasons that if any amendments are made they will need to be extensive. It is not clear to me to what extent any of the summonses will have utility after any such amendment. In some cases it is not clear what the amendments should be. I therefore consider that the preferable course is to direct the parties to confer as to the orders to be made.

80    It would be preferable if the result of that conferral is a set of amended summonses that can stand without objection. I have endeavoured to indicate my views on the substance of the present objections in detail, so as to maximise the possibility that the summonses can be amended so that all concerned can proceed without the need for a fresh application for new summonses. That is by far the most efficient course, and if it can be achieved, then s 37M and s 37N of the Federal Court of Australia Act 1976 (Cth) mandate that it should be achieved. The court will look dimly on any attempt to re-agitate the issues canvassed in these reasons if amended summonses consistent with the reasons are issued.

81    Most of the respondents have been largely successful in their applications, but not all. I will also direct the parties to confer regarding appropriate orders as to costs.

Associate:

Dated:    14 June 2019

SCHEDULE OF PARTIES