FEDERAL COURT OF AUSTRALIA hipages Group Pty Ltd [2016] FCA 986 File number: NSD 1224 of 2016 Judge: PERRY J Date of judgment: 18 August 2016 Catchwords: DISCOVERY – preliminary discovery to ascertain description of respondent under r 7.22 of the Federal Court Rules 2011 (Cth) Legislation: Federal Court Rules 2011 (Cth) r 7.22 Competition and Consumer Act 2010 (Cth) Sch 2 Date of hearing: 18 August 2016 Registry: New South Wales Division: General Division National Practice Area: Commercial and Corporations Sub-area: Regulator and Consumer Protection Category: Catchwords Number of paragraphs: 26 Counsel for the Prospective Applicants: Mr R Yezerski Solicitor for the Prospective Applicants: Whittens & McKeough ORDERS NSD 1224 of 2016 HIPAGES GROUP PTY LTD ACN 112 872 009 First Prospective Applicant HIPAGES.COM.AU PTY LTD ACN 109 996 134 Second Prospective Applicant JUDGE: PERRY J DATE OF ORDER: 18 AUGUST 2016 THE COURT ORDERS THAT: 1. Orders be made in terms of the short minutes of order annexed to the prospective applicants' submissions dated 17 August 2016 as amended at the hearing. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT (Revised from Transcript) PERRY J: 1. INTRODUCTION 1 By an originating application dated 28 July 2016, the prospective applicants, hipages Group Pty Ltd and hipages.com.au Pty Ltd (collectively, Hipages) seek orders pursuant to r 7.22(1) and 7.22(2)(c) of the Federal Court Rules 2011 (Cth) (Rules) to ascertain the description of certain prospective respondents. 2 Given the nature of the application, there is no respondent to the proceeding. Rather, the orders are sought against two other persons, National Postal Services Pty Ltd (National Postal Services) and Australia and New Zealand Banking Group Limited (ANZ Bank). In advance of the hearing, ANZ Bank indicated that it did not oppose the orders sought in the originating application and on that basis did not appear at the hearing. National Postal Services also did not appear at the hearing and, while they did not give any indication to the Court as to whether the orders were opposed, as explained below I am satisfied that they have been served with the application and other documents relied on by Hipages in support of the application. 2. EVIDENCE 3 Hipages relies upon a number of affidavits in support of its application, namely: (1) the affidavit of Alistair Gregory McKeough sworn 28 July 2016, who is the solicitor for Hipages, and the exhibit thereto – Mr McKeough gave evidence as to the history of the litigation relating to this application, searches undertaken in relation to identifying the prospective respondents, service of certain injunctions in the related proceedings as explained below, and the reasons why the orders are sought against National Postal Services and ANZ Bank; (2) the affidavit of Donna Victoria Hole affirmed on 29 July 2016, who is employed by Hipages as the Head of Trade Service, and the exhibit thereto – Ms Hole gave evidence as to the complaints received from clients of contact made with them by persons falsely representing to be from Hipages and endeavouring to sell services to those clients on behalf of Hipages, including after service of the injunctions, and as to the damage allegedly being suffered by Hipages; (3) the affidavit of Dimity van Ermel Scherer affirmed on 29 July 2016 who is employed by Hipages as a Trust and Quality Manager – Ms van Ermel Sherer gave evidence as to contact made with the ANZ Bank; (4) the affidavit of Paul Anthony Sharpless sworn 2 August 2016 who is the Director of Sharp Design Solutions which has been a client registered with Hipages since about 2014 – Mr Sharpless gave evidence of contact from persons engaging in the conduct of which the prospective applicant complains; (5) the affidavit of service of Andrew Smorchevsky sworn 17 August 2016, solicitor for the prospective applicant – Mr Smorchevsky gave evidence as to service of the application on National Postal Services and confirmation by them of receipt; and (6) the affidavit of service of Steven Turnbull sworn 12 August 2016, process server, deposing as to service of the preliminary discovery application on National Postal Services on 4 August 2016. 4 Further, at the hearing of the application Hipages also tendered a four-page printout of the website of National Postal Services. 3. BACKGROUND 5 Hipages operate an online directory of tradespeople and building and renovation service providers. 6 On 15 June 2016, Hipages commenced proceedings (the Injunction Proceedings) against two respondents, Australian Web Management Pty Ltd (Australian Web Management) and Reach Aussie Pty Ltd (Reach Aussie). In the Injunction Proceedings, Hipages' claim is that Australian Web Management and Reach Aussie have engaged in a pattern of misleading and deceptive conduct whereby they have asserted that they are associated with Hipages or are offering services by or on behalf of Hipages. 7 Justice Rares made orders in the Injunction Proceedings on 16 June 2016 granting an interlocutory injunction against Australian Web Management and Reach Aussie until 20 June 2016. That injunction was extended on 20 June 2016 until further order. 8 Neither Australian Web Management nor Reach Aussie have appeared or taken any steps in the Injunction Proceedings. 9 Notwithstanding the orders by Rares J, the conduct that is the subject of the Injunction Proceedings is alleged to have continued, with Ms Hole giving evidence that Hipages has received approximately 190 customer complaints since 16 June 2016 in respect of similar conduct. 4. CONSIDERATION 10 Hipages commenced the present proceedings for the purpose of identifying the natural persons who are engaged in the alleged misleading and deceptive conduct, and with a view to commencing proceedings against those persons for aiding, abetting, counselling or procuring, or being knowingly concerned in, breaches of s 18 of the Australian Consumer Law as contained in Sch 2 the Competition and Consumer Act 2010 (Cth) (ACL). Hipages intends to seek relief against those persons under ss 232 and 236 of the ACL. 11 Rule 7.22 relevantly provides: (1) A prospective applicant may apply to the Court for an order under subrule (2) if the prospective applicant satisfies the Court that: (a) there may be a right for the prospective applicant to obtain relief against a prospective respondent; and (b) the prospective applicant is unable to ascertain the description of the prospective respondent; and (c) another person (the other person): (i) knows or is likely to know the prospective respondent's description; or (ii) has, or is likely to have, or has had, or is likely to have had, control of a document that would help ascertain the prospective respondent's description. (2) If the Court is satisfied of the matters mentioned in subrule (1), the Court may order the other person: … (c) to give discovery to the prospective applicant of all documents that are or have been in the person's control relating to the prospective respondent's description. … 12 The term "description" is defined to mean, in the case of a natural person, the person's name, residential or business address and occupation: see the definition in the Dictionary in Schedule 1 of the Rules. 13 I am satisfied that the three requirements in r 7.22(1) are met in the present case and that it is appropriate in the exercise of discretion to require ANZ Bank and National Postal Services to give discovery to the prospective applicant under r 7.22(2)(c) of all documents in their control in the terms provided in the short minutes of order attached to the written submissions of Hipages filed in advance of the hearing and as amended in the course of the hearing. 4.1 Alleged right to relief against a prospective respondent 14 First, Ms Hole has given evidence detailing frequent and continuing complaints by clients that they have received calls from persons representing themselves as being from or on behalf of Hipages and requesting credit card details. In some cases, that contact was the subject of follow up emails. Ms Hole's evidence is that the person contacting the Hipages clients appears in fact to have been acting for the respondents to the Injunction Proceedings, Australian Web Management or Reach Aussie, or for a now deregistered company called Aussie Web Tech Pty Ltd. I note that the registered address given for Aussie Web Tech Pty Ltd appears to be the same registered address as Australian Web Management and Reach Aussie except for a different unit number. 15 While the conduct apparently commenced in around September 2010, Ms Hole gave evidence that it has been escalating since October 2015, estimating that Hipages has received a total of 600 complaints from affected clients in the period from January 2016 to 14 June 2016. Hipages has kept a database of the complaints, and examples of the complaints were given and explained by Ms Hole in her affidavit. The database of complaints includes a record of telephone numbers from which the calls were made to the clients, albeit that in some cases those telephone numbers falsely appeared as a Hipages' telephone number. Ms Hole also gave evidence of loss and damage which Hipages is alleged to be suffering as a result of this conduct. 16 Mr Sharpless gave evidence as a client of Hipages of approaches from a person engaging in this conduct who requested that he deposit money in a bank account allegedly held by Hipages with the ANZ Bank, details of which were provided to him over the telephone on 8 June 2016. The telephone number from which those calls were made accords with one of the telephone numbers recorded in the records kept by Hipages of complaints of the conduct alleged. The approaches to Mr Sharpless were made by a person who represented that he was calling from Hipages and the money was sought allegedly in order to provide discounted services for Mr Sharpless' company from Hipages. 17 As Hipages submits, the conduct described in the evidence of Ms Hole and Mr Sharpless would on its face appear to constitute misleading and deceptive conduct in contravention of s 18 of the ACL and to found a right to relief against any persons who are aiding, abetting, counselling, or procuring, or knowingly concerned in that conduct under ss 232 and 236 of the ACL. It follows that I am satisfied that Hipages may have a right to obtain relief against the prospective respondents (being the person or persons standing behind the respondents in the Injunction Proceedings) under ss232 and 236 of the ACL and therefore that the criterion in r 7.22(1)(a) is satisfied. 4.2 Alleged inability to ascertain the description of the prospective respondents 18 Secondly, Hipages has been unable to determine the identities of the natural persons engaged in the conduct. Hipages accurately summarised the evidence on which it relied in this regard in its written submissions at paragraphs 20 – 21 as follows: 20. The address of Australian Web Management and Reach Aussie registered with ASIC appears to be a post box or mail forwarding service operated by National Postal Services. Further, the directors of those companies appear to have given ASIC that same address as their personal addresses. Thus, the ordinary means by which a person can determine the identity of the directors of an Australian company have proved futile in the present case because the true address of those persons is unknown. Further, National Postal Services has not produced the information voluntarily, despite a request from Hipages' solicitor. 21. Another clue to the identity of the persons behind the conduct is that they have, on occasion, provided bank account details to Higpages' customers and solicited payments into that account. The bank account is an ANZ Bank account and a member of the fraud team at the ANZ Bank has previously indicated that the account name is "Aussie Web Management". Since that time, however, the ANZ Bank has indicated that it will not produce information about the account to the prospective applicants without a court order. 19 As counsel for Hipages drew to my attention in submissions, the name of the account identified by the member of the fraud team at the ANZ Bank differs from the name of one of the respondents to the Injunction Proceedings, that is, the member of the fraud team identified the name as "Aussie Web Management" when the respondent's name is Australian Web Management. Notwithstanding the reference to "Aussie" rather than "Australian", I am satisfied that it is reasonable to infer that the account holder is likely to be the same person for the purposes of the present application. In being so satisfied, I have had regard to the evidence summarised earlier: see in particular [14] and [16] above. 20 It follows that I am also satisfied that the criterion in r 7.22(1)(b) is met. 4.3 Likely control of relevant documents 21 Thirdly, I am satisfied that the National Postal Services and the ANZ Bank likely have documents identifying the prospective respondents. In this regard, Mr McKeough gave evidence that the business of National Postal Services includes offering mailing addresses and mail forwarding services to customers in need of a business address. In this regard the webpage for National Postal Services states that: Some of the benefits of using our Mailing Address include: … • Free email notification whenever mail or parcels arrive for you. • Access to mail forwarding services wherever you are worldwide. • Direct Debit from your credit card for your rental payments can be made half yearly, annually or biennially. (emphasis in the original). 22 Furthermore, the website states that the setup process for a mailbox requires the provision of a photo ID. It follows, as Hipages submits, that National Postal Services is likely to have information about the persons to whom mail and other materials sent to the prospective respondents are to be forwarded and other relevant identifying information. 23 Mr McKeough also gave evidence that the website for the ANZ Bank indicates that it collects certain identification information in respect of customers before providing them with any financial product, such as a passport, an Australian driver's licence or an Australian birth certificate. I accept on the basis of this evidence the submission by Hipages that the ANZ Bank likely has documents identifying the persons who opened the account in question and any other accounts operated by the prospective respondents. 24 It follows that I am also satisfied that the criterion in r 7.22(1)(c) is met. 5. CONCLUSION 25 Finally, I emphasise that the findings I have made, including with respect to the conduct alleged against the prospective respondents, the respondents to the Injunction Proceedings (Australian Web Management and Reach Aussie Ltd) and the deregistered company, are made for the purposes of this application only and are not in the nature of final findings of fact as would be made should the matter proceed to a trial. The prospective respondents have not, of course, had the opportunity to be heard as to the conduct alleged against them. 26 For these reasons, I am satisfied that orders ought to be made in terms of the short minutes annexed to the prospective applicants' submissions as amended at the hearing. I certify that the preceding twenty-six (26) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Perry. Associate: Dated: 22 August 2016