FEDERAL COURT OF AUSTRALIA Spencer v Commonwealth of Australia [2017] FCA 83 Appeal from: Spencer v Commonwealth of Australia [2015] FCA 754 File number(s): NSD 961 of 2015 Judge(s): GRIFFITHS J Date of judgment: 9 February 2017 Catchwords: PRACTICE AND PROCEDURE – interlocutory application to set aside a notice to produce – interlocutory application under r 36.57 of the Federal Court Rules 2011 to receive further evidence in the appeal – interlocutory application for leave to amend notice of appeal – whether notice to produce oppressive and not reasonably relevant to issues in the appeal. Held: notice to produce set aside and application to adduce further evidence in the appeal dismissed – leave granted to amend notice of appeal. Legislation: Constitution s 51(xxxi) Conveyancing Act 1919 (NSW) s 87As Federal Court Rules 2011 r 36.57 Cases cited: ICM Agriculture Pty Ltd v Commonwealth [2009] HCA 51; 240 CLR 140 Plain Packaging Case [2012] HCA 43; 250 CLR 1 Seven Network Ltd v News Limited (No 5) [2005] FCA 510; 216 ALR 147 Spencer v Commonwealth of Australia [2015] FCA 754 Date of hearing: 9 February 2017 Registry: New South Wales Division: General Division National Practice Area: Administrative and Constitutional Law and Human Rights Category: Catchwords Number of paragraphs: 27 Counsel for the Appellant: Mr PE King Solicitor for the Appellant: McKell's Solicitors Counsel for the First Respondent: Mr C Lenehan Solicitor for the First Respondent: Australian Government Solicitor Counsel for the Second Respondent: Ms A Rao Solicitor for the Second Respondent: Crown Solicitor (NSW) ORDERS NSD 961 of 2015 BETWEEN: PETER JAMES SPENCER Appellant AND: COMMONWEALTH OF AUSTRALIA First Respondent STATE OF NEW SOUTH WALES Second Respondent JUDGE: GRIFFITHS J DATE OF ORDER: 9 February 2017 THE COURT ORDERS THAT: 1. The notice to produce issued on 23 December 2016 is set aside. 2. The interlocutory application filed on 24 January 2017 is dismissed. 3. Leave is granted to amend the notice of appeal so as to add ground 7 as set out in the proposed amended notice of appeal dated 14 August 2015. 4. By 5:00 pm on 16 February 2017, the appellant is to file and service a supplementary outline of written submissions, not to exceed five pages in length, and confined to ground 7 of the amended notice of appeal. 5. By 5:00 pm on 26 February 2017, each of the respondents is to file and serve a supplementary outline of written submissions, not to exceed five pages in length, confined to ground 7 of the amended notice of appeal. 6. The costs of the interlocutory applications filed on 19 January 2017 and 24 January 2017 are the Commonwealth's costs in the cause. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT GRIFFITHS J: 1 The Full Court will hear the appeal in this proceeding for three days commencing on 27 February 2017. The appeal relates to Mortimer J's decision dated 24 July 2015 in Spencer v Commonwealth of Australia [2015] FCA 754. Relevantly, her Honour rejected Mr Spencer's claim that s 51(xxxi) of the Constitution was breached by the operation of two federal laws and various intergovernmental agreements and state legislative controls on native vegetation clearance which Mr Spencer claims adversely affected his land. Part of Mr Spencer's case below was that his property had been acquired as the result of NSW enacting vegetation clearance laws pursuant to agreements between the State and the Commonwealth so as to enable the Commonwealth to meet its targets under the Kyoto Protocol to the United Nations Framework Convention on Climate Change. 2 These reasons for judgment relate to the following three interlocutory matters: (a) the Commonwealth's interlocutory application dated 19 January 2017 to set aside a notice to produce issued by the appellant, Mr Spencer, on 23 December 2016; (b) an interlocutory application filed by Mr Spencer on 24 January 2017 seeking leave under r 36.57 of the Federal Court Rules 2011 (2011 FCRs) to receive further evidence in the appeal, that evidence being the documents sought under the notice to produce; and (c) an interlocutory application filed by Mr Spencer on 25 January 2017 for leave to amend his notice of appeal. 3 I consider that it is appropriate that all three matters be dealt with now and not be deferred to the hearing of the appeal given their potential impact on the likelihood of the appeal being completed within the three days allocated. I also consider that it is important that the parties know the legal position in respect of each of the three matters in advance of the hearing as it will affect their preparation for, and presentation of, their respective cases. (a) Notice to produce 4 The notice to produce contains the following seven paragraphs: 1. The official transcript of all proceedings of COP 21 convened at Paris in December 2015 attended by Australia as a party or as an observer to the United Nations Framework Convention on Climate Change ("UNFCCC") and as a signatory to the Kyoto Protocol to the UNFCCC, including but not limited to: a. The notice(s) convening COP 21; b. The agenda(s) for COP 21 at all sessions and meetings attended by Australia; c. The list of official delegates or attendees of and for the Australian Government to COP 21, and their support staff. d. The final declaration of COP 21 and Australia's announcements both official and unofficial by press release and formal statement of and concerning Australia's position on the issues addressed at COP 21. 2. All diary notes, reports memoranda and file notes, including in letter or email or other form taken or made by delegates or attendees at COP 21 for or on behalf of the Australian Government, or in preparation for COP 21, or following COP 21, of and concerning: i. carbon accounting ii. land clearing iii Article 3.7 of the Kyoto Protocol 3. The responses of the Australian delegates and attendees, including any draft response, memoranda, file notes and communications of and concerning the objections of St Lucia and South Africa to Australia's reliance as a party to the UNFCCC and/or the Koyo Protocol to Article 3.7 and land clearing exceptions to the Kyoto Protocol to Article 3.7 and land clearing exceptions to the Kyoto Protocol. 4. Correspondence to and from officers of the Department of Environment to the Australian Government between 1 7 2015 and 1 1 2017, memoranda and reports made or produced between the same dates of officers of the said Department, of or concerning: i. carbon accounting ii. land clearing iii. Article 3.7 of the Kyoto Protocol 5. Correspondence to and from officers of ABARE of the Australian Government between 1 7 2015, memoranda and reports made or produced between the same dates of officers of the said Department, of or concerning: 1. carbon accounting ii. land clearing iii. Article 3.7 of the Kyoto Protocol 6. Correspondence to and from officers of the Department of Agriculture of the Australian Government between 1 7 2015 and 1 1 2017, memoranda and reports made or produced between the same dates of officers of the said Department, of or concerning: 1. carbon accounting ii. land clearing iii. Article 3.7 of the Kyoto Protocol 7. Calculations, datasheets, reports, file notes, memoranda (including communications thereon) of any officer of the Australian Government of the financial or economic or other benefit to Australia of the land clearing provisions of the Kyoto Protocol between: i. 1 7 1996 to 1 7 1998 ii. 1 7 2015 to 1 1 2017 5 The relevant principles guiding the challenge to the notice to produce were not seriously disputed. They are helpfully summarised in Sackville J's judgment in Seven Network Ltd v News Limited (No 5) [2005] FCA 510; 216 ALR 147 (Seven Network). They may be summarised as follows: (a) the test to be applied is whether the documents sought are of "apparent relevance to the issues" in the proceedings and, in this context, it is appropriate to ask whether the documents sought are "reasonably likely to add, in the end, in some way or other, to the relevant evidence in the case"; and (b) in determining whether the notice to produce is "oppressive", it is relevant to ask whether it has been demonstrated that the notice is "seriously and unfairly burdensome, prejudicial or damaging" and "productive of serious and unjustified trouble and harassment". In this context, it is relevant to inquire into the true purpose of the party issuing the notice to produce (in the context of determining whether there is a legitimate forensic purpose), and also to examine the impact upon the recipient. 6 Although the guidance provided by Sackville J was directed to the issue of a notice to produce in the context of a trial, the notice to produce here has been issued only shortly before the appeal is scheduled to be heard and, in large part, seeks material which postdates the primary judgment. 7 In support of its application to set aside the notice to produce, the Commonwealth relied inter alia upon an affidavit dated 3 February 2017 by its instructing solicitor, Mr Matthew Varley, who was not required for cross-examination. 8 The key relevant features of that affidavit may be summarised as follows: (a) extensive discovery was given over a period of approximately two years leading up to the trial and Mr Spencer consented to at least some of the categories of discovery that were given by the Commonwealth. Moreover, Mr Spencer was legally represented when the categories of discovery were agreed; (b) in preparing for the appeal, orders were made on five separate occasions setting five deadlines for Mr Spencer to serve any application for the Full Court to receive further evidence in the appeal under r 36.57 of the 2011 FCRs. The latest deadline for any such application was 14 November 2016; (c) on 19 December 2016, the Commonwealth and the State of New South Wales filed and served their written outlines of submissions in relation to the substantive appeal in accordance with the Court's orders; and (d) the notice to produce would impose a significant burden on the Commonwealth because compliance with it would involve Commonwealth officers from several departments and agencies having to review tens of thousands of documents which may take thousands of hours in locating potentially relevant documents, reviewing them to determine whether they are covered by the notice and determining any claims for privilege or immunity. 9 The Commonwealth also submitted that Mr Spencer faced what was described as "an insuperable difficulty" because the material he seeks under the notice to produce could only be relevant to his appeal if it established that the Commonwealth or some other party obtained a benefit of a proprietary nature. The material sought seems to be directed to the proposition that Australia obtained some kind of "benefit" in complying with Australia's international obligations, but that is insufficient to give rise to a relevant proprietary interest for the purposes of s 51(xxxi) of the Constitution. 10 Moreover, to the extent that Mr Spencer was claiming that there was a benefit to the Commonwealth because Australia would have an amount of emissions which was surplus to the first commitment period under the Kyoto Protocol which would be rolled over into the second commitment period from 2012 to 2020, the Commonwealth responded by saying that: (a) the alleged "acquisition" was completed, at the latest, by July 2007; (b) the Kyoto Protocol only entered into force for Australia after that date; and (c) in any event, the obligations imposed by that instrument only applied from 2008. 11 The Commonwealth also submitted that Mr Spencer had failed to explain the delay in issuing the notice to produce, against the background of the extensive discovery at the trial and his failure to comply with the five deadlines for filing any application to adduce further evidence. 12 Mr Spencer relied on three affidavits, all sworn by him. The first was filed on 24 January 2017 and the other two on 8 February 2017 (one totalling three pages plus annexures, the other totalling nine pages plus exhibits). Substantial parts of the latter affidavit and exhibits were ruled inadmissible but I indicated that relevant parts of the affidavit would be treated as submissions only. Some parts of this affidavit were rejected as scandalous. Mr Spencer acknowledged in this affidavit that he was sure that it contained "many shortcomings" because it had been prepared under pressure of time. His assessment was correct. 13 This affidavit also contained what was described by Mr Spencer as a "compromise" concerning his notice to produce. The compromise was said to be predicated on the Court upholding the notice to produce and involved the Commonwealth answering the notice to produce by reference to the following suggested categories (which refer to the contents of the notice to produce): Category 1: Item 1 and Item 1 – c. and d. Item 2 i-iii. Item 3. Item 5 i-iii. Category 2: Item 1 – a and b. Item 4 i-iii. Item 7. Category 3: Item 6 i-iii. Item 7 – a and b. Mr Spencer's proposal was that Category 1 documents should be produced as soon as possible and at least one week prior to the appeal commencing on 27 February 2017; Category 2 documents should be provided three weeks after the hearing; and the Category 3 material should be provided six weeks after the hearing. 14 During the course of the hearing, Mr King, who appeared for Mr Spencer, proposed another arrangement which involved the Commonwealth producing all material within the notice to produce which it had collected so far by close of business this Friday and the balance of the material should be produced within seven days. Consideration 15 In my respectful view, the Commonwealth's submissions should be accepted. There was no serious challenge by Mr King to Mr Varley's evidence which demonstrated that compliance with the notice to produce would be oppressive. I reject Mr Spencer's submission that the Commonwealth's evidence in support of its complaint of oppression was not detailed. I am satisfied that the evidence establishes the propositions summarised in [8] above. Given the volume of material sought there is little doubt that, if the material had to be produced imminently, the hearing date would need to be deferred, yet again. 16 No satisfactory explanation has been provided as to why Mr Spencer has delayed so long in issuing the notice to produce. I accept that Mr Spencer has experienced some practical difficulties in filing material concerning what he describes as the "New evidence", but that does not explain his delay in issuing the notice to produce. The practical difficulties relate to other material. I also accept that Mr Spencer has faced other logistical difficulties, presented by his accommodation arrangements and the fact that he has also unfortunately experienced health issues concerning his leg and his right hand. I also take into account that, until relatively recently, he has represented himself, both in the proceeding below and in the appeal. 17 It appears that Mr Spencer was not legally represented when the notice to produce was issued on 23 December 2016. Mr Spencer has no legal qualifications but that is not to say that he is unfamiliar with Court processes having regard to the long history of his litigation, which is described in Mortimer J's judgment at [39]-[50]. Mr Spencer represented himself for the bulk of the lengthy hearing at first instance. 18 As the Commonwealth pointed out, Mr Spencer has apparently been aware of the relevance of the material the subject of the notice to produce since mid-2016 when he swore the affidavit dated 28 April 2016 in contemplation of making an application for leave to rely upon further evidence, yet the notice to produce was not issued before 23 December 2016. A copy of that affidavit was annexed to one of his affidavits filed 8 February 2017 for the purposes of the interlocutory hearing. 19 In my opinion Mr Spencer has failed adequately to explain why he left it to two days before Christmas to file the notice to produce in circumstances where he was also on notice from directions made by Rangiah J on 4 July 2016 that his appeal would be heard during the February 2017 Full Court sittings and in circumstances where no less than five deadlines were set for him to apply to seek leave to adduce further evidence in the appeal if he wished to do so. The most recent of those deadlines was 14 November 2016. 20 Mr Spencer's suggested "compromise" does not alleviate the oppression to the Commonwealth. It is far from clear that production of the Category 1 documents in the timeframe suggested would be sufficient to avoid the hearing being vacated. The fact that Mr Spencer proposes that Category 2 and 3 documents be produced after the hearing further highlights the impracticality of his proposal and undermines the important objective of finality in litigation, not the least in a case such as this which has now taken almost ten years to get to this point. Nor in my view does Mr King's proposed arrangement alleviate that oppression. The arrangement provides inadequate time for the Commonwealth to collect the relevant documents, determine whether or not they fall within the ambit of the notice to produce and give proper consideration to whether claims of privilege or immunity should be made. In my view, it is quite unreasonable to expect all these matters to be attended to within the timeframe indicated by Mr King, bearing in mind that the Commonwealth's legal representatives will be concentrating on preparing for the substantive appeal, which is due to commence in less than three weeks. The volume of the material which may be covered by the notice to produce is considerable according to Mr Varley's affidavit, which I accept. 21 These matters are sufficient of themselves to set aside the notice. In addition, at this interlocutory stage, there appears to be prima facie force in the Commonwealth's submissions regarding the apparent lack of relevance of the notice to produce to the issues in the appeal, particularly concerning the need to demonstrate a benefit of a proprietary nature. Mr King stated that this issue would be contested in the appeal, but this submission was not developed during the course of the interlocutory hearing other than by a brief reference to s 87A of the Conveyancing Act 1919 (NSW) which defines the concept of a "carbon sequestration right". The primary judge rejected the argument that this right was of a proprietary nature ([530]-[534]) and it appears difficult to reconcile it with the reason of the High Court in both the Plain Packaging Case [2012] HCA 43; 250 CLR 1 and ICM Agriculture Pty Ltd v Commonwealth [2009] HCA 51; 240 CLR 140. I fully acknowledge that Mr King may persuade the Court at the hearing of Mr Spencer's appeal that his position on this matter is correct. It is unnecessary (and inappropriate) that a final view be expressed on this issue at this juncture, having regard to the test as described in [5(a)] above. The relevant test is expressed in terms of "reasonable likelihood" and "apparent relevance", which concepts are to be understood in the context of the question whether the party issuing the notice to produce can demonstrate that it has a legitimate forensic purpose. I am not satisfied that these thresholds have been met on the basis of the material currently before the Court and the submissions made in respect of the Commonwealth's application to have the notice to produce set aside. Accordingly, if it had been necessary to do so, I would also set aside the notice to produce on the ground of relevance. 22 For these reasons, the notice to produce will be set aside. (b) Application under r 36.57 of the 2011 FCRs 23 Mr Spencer's interlocutory application dated 24 January 2017 must be dismissed having regard to the Court's decision to set aside the notice to produce. The notice to produce was intended to provide the evidence the subject of the interlocutory application. (c) Leave to amend notice of appeal 24 The Commonwealth neither opposed nor consented to Mr Spencer's application to add the following further ground to his notice of appeal: The Judge erred in holding that the Appellant's right of action for compensation and/or damages is not known to the law. 25 Ms Rao, who appeared for the State adopted a similar position. 26 In the circumstances, I am inclined to grant leave to amend the notice of appeal in the form sought in the document dated 14 August 2015. The appellant should file and serve a supplementary outline of written submission, confined to ground 7 of the amended notice of appeal, by 5 pm on 16 February 2017. Each of the respondents should file and serve supplementary written outlines of submissions in respect of the same matter by 5 pm on 23 February 2017. The supplementary submissions of the parties must not exceed five pages in length. Conclusion 27 For these reasons the notice to produce will be set aside and the appellant's interlocutory application filed on 24 January 2017 dismissed. Leave will be granted to add ground 7 to the notice of appeal. The costs of the interlocutory applications concerning the notice to produce and leave to admit further evidence should be the Commonwealth's costs in the cause. Appropriate orders will be made accordingly. I certify that the preceding twenty-seven (27) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Griffiths. Associate: Dated: 9 February 2017