Re Day [2016] HCATrans 298 (12 December 2016)

Last Updated: 13 December 2016

[2016] HCATrans 298

IN THE HIGH COURT OF AUSTRALIA

SITTING AS THE COURT OF
DISPUTED RETURNS

Office of the Registry
Canberra No C14 of 2016

B e t w e e n -

IN THE MATTER OF QUESTIONS REFERRED TO THE COURT OF DISPUTED RETURNS PURSUANT TO SECTION 376 OF THE COMMONWEALTH ELECTORAL ACT 1918 (CTH) CONCERNING MR ROBERT JOHN DAY AO

GORDON J

TRANSCRIPT OF PROCEEDINGS

FROM CANBERRA BY VIDEO LINK TO SYDNEY

ON MONDAY, 12 DECEMBER 2016, AT 10.13 AM

Copyright in the High Court of Australia

MR C.L. LENEHAN: May it please the Court, I appear with MR B.K. LIM, for the Attorney-General of the Commonwealth. (instructed by Australian Government Solicitor)

MR A.S. BELL, SC: Your Honour, I appear with my learned friend, MR D.P. HUME, for Mr Day. (instructed by Griffins Lawyers)

MR J.K. KIRK, SC: May it please the Court, I appear with my learned friend, MS S. GORY, for Ms McEwen. (instructed by Norton Gledhill)

HER HONOUR: Thank you. Mr Lenehan, can I have a chat to you first, please. In relation to the document that I received yesterday, which is the agreement, can I ask you a couple of questions about what appears on page 10?

MR LENEHAN: Yes, your Honour.

HER HONOUR: In relation to paragraph 67, which is an agreement between the Attorney and Mr Day, is that the extent of the agreement or is further required?

MR LENEHAN: That is the current extent of the agreement, your Honour.

HER HONOUR: So I do not know the date it was entered into or who is involved, is that the position?

MR LENEHAN: Yes, that may require some elaboration, your Honour. I apologise for that.

HER HONOUR: I think it does, so you will need to attend to paragraph 67, it seems to me.

MR LENEHAN: Yes.

HER HONOUR: You are happy to accept 68, although you do not seek to make any points in relation to it, is that right?

MR LENEHAN: That is correct, your Honour, if you look to footnote 2.

HER HONOUR: Yes. Well, my present view is this. In relation to paragraphs 1 to 68, subject to what Dr Bell and Mr Kirk may say, the reference to the extent of those paragraphs will be referred to a Full Court pursuant to section 18 of the Judiciary Act 1903 (Cth) and the parties should proceed on the basis and on the assumption that that reference will be heard by the Full Court on or about 7 February 2017. And what I suggest

happens, subject to anything anyone wants to say, is that paragraphs 1 to 68, subject to you and Dr Bell having a discussion about 67, it seems to me, because at the moment I think it is lacking some detail, will in effect be – as well as any other facts you want to agree, will form the basis of and be included in the statement of facts that is referred to in paragraph 9 of the orders made by the Chief Justice on 21 November 2016.

MR LENEHAN: Yes.

HER HONOUR: That would then seem to me to mean that paragraphs 10 and 11 of that order probably can be set aside.

MR LENEHAN: Yes.

HER HONOUR: So to the extent that there is agreement between the three of you – that is, the Attorney-General, Mr Day and Ms McEwen - which would include 1 to 68, subject to the qualification I have made in relation to 67, that would proceed for hearing, as I have said, at the moment parties should expect that that will occur on 7 February 2017. Now - - -

MR LENEHAN: Yes, your Honour - - -

HER HONOUR: Yes.

MR LENEHAN: I apologise, your Honour.

HER HONOUR: No, you go.

MR LENEHAN: The Attorney-General would support that course, your Honour.

HER HONOUR: Thank you. Dr Bell, do you want to say anything about that for the moment? I am about to deal with the McEwen matter separately.

MR BELL: Yes, subject to any overlap with the McEwen matter, we accept that that is an appropriate way of going forward.

HER HONOUR: Thank you. Now, in relation to McEwen, while I have got you, Dr Bell, what I propose – and this addresses to you too, Mr Kirk - it seems to me that what follows from 69 onwards - and I will have to have a discussion, Mr Kirk, about the significance of some of these matters - is what I would currently propose is that there be a trial in Melbourne on 23 January for two days, and if it is necessary for facts to be topped up they can be topped up then and they will then be subject to findings if it is necessary and they will be referred to and added to the reference. So at the moment there is a foundation, it seems to me, to paragraphs 1 to 68 which is common ground. So there is a sufficient basis for the reference to go forward, and then I will set aside those two days in Melbourne to hear any argument about any additional facts and matters.

MR BELL: Yes.

HER HONOUR: Now, that requires a lot of work, I suspect, between the two of you, so it may be necessary if I have a discussion with Mr Kirk about the extent to which these matters that follow in 69 onwards. Do you wish to say anything about what appears in Part V of this document?

MR BELL: Does your Honour wish to address Mr - - -

HER HONOUR: No, to you, Dr Bell, do you want to say anything?

MR BELL: Well, your Honour, there are allegations, for example, 112 and 113 which we do not see the relevance of and the same, if I could put it bluntly, fairly gratuitous in the sense that the question referred the Senator - did he have an incapacity at a particular time. He either did or did not.

HER HONOUR: Yes.

MR BELL: Turning on whether he had a pecuniary interest or did not. Paragraphs 112 and 113, which involve serious allegations about knowingly completing a misleading application, et cetera, do not arise on the question referred and, for example, the Court should not - - -

HER HONOUR: So just so I am clear, let us do this mechanically and methodically, in relation to those matters which fall into that category, is it only 112 and 113?

MR BELL: I think that is right, your Honour. I sort of started at the back - - -

HER HONOUR: Can I ask this of you, which I do not quite understand? I notice that in relation to paragraphs – and I did write them out – some of them you do not agree with and some of them you disagree with. Is there a distinction to be drawn? So you have got “does not agree” at paragraphs 71, 89, 90, 92, 98 and 99, and then you have got “disagrees” in 73 and following. Is there a reason - - -

MR BELL: No, only the speed with which this composite document is cobbled together and the input, I suspect, of different authors on different drafts.

HER HONOUR: I see, all right.

MR BELL: There is no intended differentiation with that different use of language.

HER HONOUR: So, other than 112 and 113 that fall into this category of, in a sense, post-event conduct - - -

MR BELL: Yes, there is a paragraph dealing with – well, for example - - -

HER HONOUR: What about 85?

MR BELL: At 83 and 84 - - -

HER HONOUR: And 85?

MR BELL: And 85, it is a slightly different point but they again, with respect, are unnecessary matters - will unduly prolong any hearing and we do not see the relevance of it. Again, it is the question of whether there was a direct or indirect pecuniary interest in the lease agreement between the Commonwealth and Fullarton Investments. There is also an allegation – I am just trying to pick up, your Honour, about the parliamentary library – yes, 103. Well, 102 - - -

HER HONOUR: Well, while I am having a chat to Mr Kirk, I think you should produce a list of those which fall into this sort of category so we are clear which ones you are talking about, rather than just standing here and picking them out.

MR BELL: Yes, I am sorry, your Honour. We will do that. My junior is making that list as we speak, I think.

HER HONOUR: It is called a handball. All right. Can I ask you one other matter before you sit down and that is this -

MR BELL: Yes.

HER HONOUR: In relation to what appears on paragraphs 69 and 70, which is really going back to the dispute between yourself and the Attorney-General - - -

MR BELL: Yes, your Honour.

HER HONOUR: - - - could you explain to me what the significance of 69 is? Why does it matter?

MR BELL: I do not think it does, is the short answer.

HER HONOUR: I had better ask Mr Lenehan why it is there. What about 70?

MR BELL: The only issue – I do not act for Fullarton Investments and we were not in a position to – it is not that we necessarily disagree, we are just not in a position to – I do not know – we did not know the answer to that allegation. That is the allegation which was made.

HER HONOUR: I see. Well, I think 69 can be added to the list with 67 from my perspective.

MR BELL: Yes.

HER HONOUR: Mr Lenehan, what is the significance of 69?

MR LENEHAN: Your Honour, in our statement of facts and contentions, we allege that the lease had been rescinded. Our friends - - -

HER HONOUR: I know that but I want to know what the legal significance of the fact is? How is it relevant to your argument?

MR LENEHAN: Your Honour, it probably falls into the category of background and so it probably could in fact go.

HER HONOUR: All right. Well, I am going to leave 69 out. What about 70? What is the position with 70?

MR LENEHAN: Paragraph 70 is, I think, in a different category and we had initially proposed, your Honour, to rely on a documentary order sought by my friend, Mr Kirk, and it may be that I need to - - -

HER HONOUR: I do not understand that. Could you explain that to me again? What do you mean by “documentary order”?

MR LENEHAN: So Mr Kirk had filed a summons which was returnable today. The Chief Justice had initially - - -

HER HONOUR: No, I know that. So when you say “documentary order” you mean the issue of a subpoena?

MR LENEHAN: Yes.

HER HONOUR: And you are relying on Mr Kirk to get that information for you?

MR LENEHAN: We had initially intended to put on our own application for subpoena and when we saw what was sought by our friends we decided that we could take the view that we would get the documents from the order that they sought.

HER HONOUR: I see. All right.

MR LENEHAN: But it really relates to a very narrow issue, which is what was the position in terms of income for Fullarton Investments for the period, and if we are able to agree that matter with our friends then we need seek no such order.

HER HONOUR: Well, it is for the year ending 30 June 2015, so it is from 1 July 2014 to 30 June 2015.

MR LENEHAN: Yes, and Mr Kirk had sought some documents for the next financial year as well, your Honour, and - - -

HER HONOUR: I thought there was agreement from Mr Day about the income for Fullarton Investments because does not he plead that there was income also from other tenants?

MR LENEHAN: Well, I will not speak for Dr Bell, your Honour, but the position seemed to us - - -

HER HONOUR: Well, it is set out in their statement of facts and contentions.

MR LENEHAN: Yes, it is, and so on one view it seems to be accepted that your Honour, I think, has in mind a response to our paragraph 52, where it is said – 52.1 “Fullarton Investments had other tenants of the property as potential sources of income”. Now, if that is the only alleged other source of income, putting to one side the hypothetical in 52.2 of Dr Bell’s statement of facts and contentions, we can live with that because that is the very thing that we contend for, that it was - - -

HER HONOUR: Dr Bell, is that in dispute between the two of you?

MR BELL: I think Fullarton Investments had one asset and - - -

HER HONOUR: The property.

MR BELL: Property, and there were certainly other tenants, and that is why we have said what we have said as recorded in the statement of agreed facts in Part I. The only reason, your Honour, why we have not admitted 70

is that it is a precise figure. It emanates, I think, from some unsigned management accounts.

HER HONOUR: It does. I have read the accounts, but my problem is that at page 5 at paragraph 52.1 you plead that “Fullarton Investments had other tenants of the property as potential sources of income”. So you at least turned your mind to that issue.

MR BELL: Are you in - - -

HER HONOUR: Page 5, 52.1 of your contentions.

MR BELL: Thank you, your Honour. Yes, and that is in response to the pleading - - -

HER HONOUR: At 52.3(a) that the only source of income for Fullarton Investments was the rent payable by the Commonwealth and any other rent payable by other tenants.

MR BELL: Yes. We accept, as we have written, that they had other tenants as potential sources of income but whether or not Fullarton Investments – I do not act for Fullarton Investments - - -

HER HONOUR: I know you do not, I accept all that.

MR BELL: - - - Mr Day is not a director of them, so we just simply were not in a position to agree more than to acknowledge what we have acknowledged in 52.1.

HER HONOUR: All right, well, it seems a bit odd.

MR BELL: And the only quibble about the $10,000 is we appreciate that is what is in the unsigned management accounts. If they are correct, then that would be an accurate statement of the income.

HER HONOUR: All right, I will have a chat to Mr Kirk, thanks. Now, Mr Kirk, of all the matters that are set out in paragraph 71 and following, which are it seems directed at knowledge or intention to make arrangements - - -

MR KIRK: Yes, your Honour

HER HONOUR: - - - what is the legal significance you attach to those pleadings – that is, knowledge or intention that would give him or give you additional arguments other than that which have already been referred?

MR KIRK: Could I take your Honour to our statement – that is, Ms McEwen’s statement of contentions of fact and law at page 8 first?

HER HONOUR: Yes.

MR KIRK: So page 8, your Honour will see paragraph 36 which is echoed in the joint statement and that is bringing together a series of facts. Then under the heading “The questions”, if your Honour turns to the next page, paragraph 40, your Honour will see how Ms McEwen contends that question (b) should be answered, namely by “disregarding a vote” not only below the line for Mr Day but above the line for Family First, as it was identified on the ballot paper. And paragraph 41 then brings out the arguments or a summary of the arguments we would seek to articulate in support of the answer to question (b) contained in paragraph 40. So looking at - - -

HER HONOUR: But none of those matters in 41 are directed to knowledge or intention of Mr Day, are they?

MR KIRK: If your Honour looks at paragraph 41(b) and that goes back – that builds on the fact that Mr Day obviously knew his own circumstances when he nominated as a candidate, and further, and it is not in dispute, he was the relevant registered officer of Family First who submitted, in effect, the request that they have an identification as Family First above the line.

So, to put that in a little bit of context, what is wrapped up in 41 is first what will be an attempt to distinguish what his Honour Chief Justice Mason said in the follow-up directions in the Wood Case in 1988, but secondly, the making of an additional argument to say that even if we cannot distinguish Wood, here there are particular and probably unique circumstances in which the arrangements that then Senator Day set up were, in Ms McEwen’s ultimate submission, a sham. They were designed to - - -

HER HONOUR: The arrangements are not pleaded as a sham. That is my point. The arrangements are pleaded according to their terms and effective according to their terms. The way in which you put it is not a sham at all. You talk about an arrangement arising from objective facts which you seek to, in effect, uphold. It is a very different thing.

MR KIRK: The arrangement is what we have articulated in paragraph 10 of this document on page 2, and it is also contained in the document, and what it comes down to is that either the property itself was held on trust for Mr Day or for the Day Family Trust, or alternatively the shares in Fullarton Investments were held on trust for Mr Day or B&B Day, but furthermore, as we have pleaded in 10(h), or articulated in 10(h), that Day would maintain control of the company – that is to say Fullarton Investments. So the effect of that was that there was a purported transfer of a legal ownership but in substance - - -

HER HONOUR: No, there was a transfer, that is the point.

MR KIRK: Yes, your Honour.

HER HONOUR: There was a transfer and you do not allege that transfer was a sham. You say it was an arrangement entered into by reference to a set of facts. I mean, the position is this - whether or not there has been an arrangement or understanding is inevitably and often depends upon the view you form of all the circumstances and I had thought the way you had pleaded it was to say we accept all of the Attorney-General’s facts and circumstances but we give a different legal character to them and you can work out whether or not there is such an arrangement by looking at objective facts, independent facts, inferences drawn from those primary facts including joint actions by parties. One does not have to sit there and prove knowledge and intent. One can do it by reference to the things which have been set out in paragraphs 1 to 67 or 68.

MR KIRK: Well, that may be right, your Honour, but in order to bring into play what we have articulated in 41(b), namely “the decision to print a square” above the line for Family First was procured in these circumstances outlined above and that that leads to a conclusion for public law purposes of fraud, that may depend and may well depend on what we have identified as at least reckless indifference to the statement as articulated in 36(d) by Mr Day, sufficient to bring into play the old saying that fraud unravels everything, which is where we will ultimately be heading to, and that includes unravelling the ultimate decision to print the square above the box for Family First.

HER HONOUR: Do you accept that if the Commonwealth is right on its view of paragraphs 1 to 68 that this is unnecessary?

MR KIRK: No, I think we go further than the Commonwealth, your Honour.

HER HONOUR: No, I know you go further, that is not my question. My question is do you accept that if the Commonwealth is right on paragraphs 1 to 67, that this is unnecessary?

MR KIRK: No, I do not think I do accept that, your Honour. I may end up putting that in the alternative but we have perceived it as necessary - - -

HER HONOUR: And why is 1 to 67 not sufficient?

MR KIRK: Because that does not articulate the arrangement in the way that we have sought to do so. The way the Commonwealth - - -

HER HONOUR: That is not my question, Mr Kirk. My question is whether or not paragraphs 1 to 67, if they are established and the Attorney-General is right, are sufficient for the answering of the questions that you seek?

MR KIRK: No, I do not think it is, your Honour, because it does not establish that fraud for public purposes that we allege against Mr Day.

HER HONOUR: But you do not need it, do you? That is my point.

MR KIRK: But it may be that we do because we have got - - -

HER HONOUR: Well, you may need it but you do not necessarily need it, is that the position?

MR KIRK: Yes, but we may need it - - -

HER HONOUR: All right, now I understand. That is the reason why the trial on the 23rd and the 24th will have to address any top-up facts you seek to prove. How are you going to do that?

MR KIRK: Yes, your Honour. Well, first we seek documents by way of subpoena or whatever we have identified in the summons.

HER HONOUR: We will go through those in a moment. So will it be a documentary case on the 23rd and 24th?

MR KIRK: No, there may also be witnesses. Now, there will be - - -

HER HONOUR: But you have not sought leave to issue subpoenas today for witnesses.

MR KIRK: No, that is true but we may seek to file affidavits, your Honour, and obviously - - -

HER HONOUR: Well, no, you will not file affidavits; there will be no affidavit evidence. They will be called to give evidence in the box, you will have to file an outline, but who are these witnesses and when will we know who they are?

MR KIRK: Well, your Honour, it will be between one to three witnesses. We will seek - - -

HER HONOUR: Who are they?

MR KIRK: I will answer that question if your Honour, with respect, insists that I answer that question. I would prefer not to answer it at this stage, recognising the public nature of the matter and the significant pressure on people involved, but we would certainly identify by the end of the week who we are proposing to call and an outline of what they would say, and it will be no more than three witnesses.

HER HONOUR: And will they need to be subpoenaed?

MR KIRK: Well, I confess we had been anticipating moving by affidavit, but in light of what your Honour has just said to me, then yes, we would need to issue subpoenas for them to appear.

HER HONOUR: Why does the affidavit versus the outline affect the subpoena? You are not going to have to answer that. I mean, the whole point of the subpoena regime put in place by the Chief Justice was that these questions were already on the page and on the table before we came along to the directions hearing.

MR KIRK: Well, I confess we had understood that related to our application on the last occasion for documents rather than for - - -

HER HONOUR: No, it says subpoenas.

MR KIRK: Well, that was our misunderstanding and I apologise, your Honour.

HER HONOUR: So by Friday we will know – have both the names and the outline of their evidence, is that the position?

MR KIRK: Yes, your Honour.

HER HONOUR: And have you given notice to Dr Bell of these matters?

MR KIRK: Well, in relation to the subpoena for the application for documents, yes, on - - -

HER HONOUR: No, I am talking about the witnesses at the moment. I am trying to work out what we are going to do on the 23rd and 24th.

MR KIRK: No, your Honour, I have indicated to Dr Bell previously that there may be witnesses and we are seeking to finalise it this week.

HER HONOUR: I see.

MR KIRK: It may also be conceivable that there – well, first, there are a few possibilities. First, it may be that there would be no need for cross-examination, although in the scheme of things it is quite likely there would be. Another possibility is that Mr Day or some other persons might be called to give evidence on behalf of Mr Day, but naturally enough Dr Bell and those who instruct him and Mr Day would wish to see our outlines of evidence before making that decision.

HER HONOUR: And is Friday the earliest these can be provided?

MR KIRK: We can seek to do better. I was instructed Friday is what was possible, but we will seek to do it beforehand if we can, your Honour.

HER HONOUR: All right. So other than up to three witnesses, there will be a documentary case that will be run?

MR KIRK: Yes, your Honour.

HER HONOUR: And what is the extent of that, do we know yet, other than by reference to these subpoenas?

MR KIRK: Correct, and also the documents referred or alluded to in the agreed document that was provided yesterday.

HER HONOUR: No. The 23rd and 24th will be top-up facts, so let us just make it abundantly clear what will happen on the 23rd and 24th. What has already been referred will not be the subject of evidence. They are established. They are agreed between the three of you – that is, between Day, McEwen and the Attorney-General. What I am dealing with on the 23rd and 24th is any additional facts that you seek to prove that I will make findings on and which I will then add to the reference to be heard in February.

MR KIRK: I understand that, your Honour, but in the paragraphs that follow paragraph 70 there are some documents referred or alluded to, and so those documents would also be sought to be placed before the Court on 23 January.

HER HONOUR: No, you will need to do it before that, to the extent that they will need to be produced what it is you propose to produce into evidence so that I can look at them before then.

MR KIRK: Yes, your Honour.

HER HONOUR: Now, can I deal with two categories before I turn to the subpoenas? In relation to what – and Dr Bell, have you got a list of all those paragraphs that relate to post-event conduct?

MR BELL: I do, your Honour. We think it is paragraphs 83 to 85, 100 to 106, 112 and 113, and I will just check one thing.

HER HONOUR: I am sorry, I did not hear that.

MR BELL: Sorry, 112 and 113.

HER HONOUR: Yes.

MR BELL: And I am just checking, in 107 the reference – no, I will leave that. So just 83 to 85, 100 to 106, 112 to 113, they are the paragraphs, your Honour. In relation to witnesses, we would ask that your Honour direct to the witnesses today, everyone is going to be working under a very tight timeframe, not least my client. If we need to consider calling witnesses in reply, et cetera - - -

HER HONOUR: What I will do is I will ask Mr Kirk to tell you. He can tell you today who the up to the three are at the moment by name without doing it publicly.

MR BELL: Yes.

HER HONOUR: It can be stated between counsel. There is no reason not to, is there, Mr Kirk?

MR KIRK: No, your Honour.

HER HONOUR: No, so you can be told now, Dr Bell.

MR BELL: Thank you. Your Honour, just before my friend returns, two points which are raised out of the dialogue between your Honour and Mr Kirk. Like your Honour, we are acutely conscious of the difference between a sham and other allegations and there is no allegation of sham anywhere and we have been preparing on that basis. We do not wish to be met with some loose sham-style argument and we need to make our forensic decisions on the basis of what is effectively pleaded or set forth in the notice of contentions, so we are proceeding on the basis that real transactions occurred.

HER HONOUR: Yes.

MR BELL: And property was registered, et cetera.

HER HONOUR: That does not stop Mr Kirk doing what I put to him and that is what we have known since Associated Northern Collieries, that you can take a set of facts objectively and determine that there is an arrangement in place. That is, the arrangements are real, documents are executed, transfers are executed, but notwithstanding those things that there is an arrangement in place and one can look at the way in which parties behave in order to determine whether or not such an arrangement exists. That is very different from sham.

MR BELL: Quite. The only other point I would make, your Honour, which would be relevant for the 23rd and 24th is that the paragraphs from paragraph 79 onwards contain really not just facts but some legal conclusions, for example, as to the existence of a trust, et cetera, which would be, we would submit, at least a conclusion of mixed law and fact. So I am just really drawing that to your Honour’s attention because it may be slightly different to – I mean, if the exercise is purely a fact-finding one, which is what we apprehend from your Honour, it may be useful for a direction to be made today that Ms McEwen isolate in a new document the factual conclusions she is contending for or will be contending for on the 23rd and 24th.

HER HONOUR: One way I thought it would be able to be achieved with clarity would be this, is that Mr Kirk should identify the findings of fact that he would want me to make after hearing on the 23rd and 24th, and therefore everyone knows what it is (a) you are up against, and (b) what it is I am being asked to make as findings of fact by way of top-up, that is, additional facts to that which is the subject of the agreement in paragraphs 1 to 67.

MR BELL: Yes, and that, we would submit, should really be the first - the next step for Ms McEwen to take to isolate those findings of fact that are - - -

HER HONOUR: Well, I suspect it is a sort of an exercise that will be done as a result of the evidence that is about to be summarised and given to us this week, as well as the documentary material.

MR BELL: Yes - well, yes, but sooner rather than later, I suppose, is my point. Your Honour, I am content to wait, if your Honour wishes to address on the subpoenas but we - - -

HER HONOUR: Yes, I want to deal with the paragraphs first and then I will deal with each of the subpoenas in turn, if I might.

MR BELL: Thank you, your Honour.

HER HONOUR: Now, Mr Kirk, before we get to the subpoenas, can I just deal with these paragraphs about which Dr Bell complains; that is, 83 to 85, 100 to 106 and 112 to 113.

MR KIRK: Yes, your Honour.

HER HONOUR: These are all post-event conduct. They all occurred after the event. How can they have any relevance to the questions which are the subject of the reference?

MR KIRK: It depends on what event is identified, your Honour. A key event in some way for the purposes of our arguments, as identified in paragraph 36 of our contentions, is what Mr Day knew and understood or was indifferent as to, when he made the statement and declaration that he was - he suffered no disqualification under the Constitution to be elected as a senator which was on or about 2 June 2016, as identified in paragraphs 32 to 33 of our statement.

HER HONOUR: So, I raise the matter again. So, how is it that what is said in 83, 84 and 85 - I mean, either Mr Day has a pecuniary interest in the leasehold or he does not. So, how does 83 to 85 and 100 to 106 assist you?

MR KIRK: Because, your Honour, it leads up to what is a crucial paragraph in our statement for the purposes of one of our arguments; 36, namely, that he was at the least:

recklessly indifferent as to whether the statement and declaration -

that he suffered no disqualification under the Constitution was true, and it is part of our argument, building on fraud unravelling everything, that he was at the least recklessly indifferent as to whether that statement was true and that undermines both his nomination as senator and in his capacity as registered officer of Family First endorsing himself and the number 2 candidate to have Family First listed above the line, next to the group square.

HER HONOUR: All right, well, I will have to have a think about those paragraphs and I will have to come back to them. Can I deal then with each of these subpoenas in turn?

MR KIRK: Yes, your Honour. So, I apologise for the number of variations of summons as various more documents came to hand. The one I am seeking to rely on is the one filed in Melbourne this morning and which was emailed to Ms Rogers on Saturday which I hope your Honour has and it has four schedules in contrast to earlier versions which only had three schedules.

HER HONOUR: I have that document.

MR KIRK: Thank you, your Honour. Does your Honour want me to go through each of the schedules in each of the categories?

HER HONOUR: Well, let us deal with the Day one first because we have got counsel for Mr Day here. Do you object to this subpoena Dr Bell?

MR BELL: Yes, your Honour. It is to Mr Day, it is also to B&B - - -

HER HONOUR: I know, I accept that but at the moment I do not have anyone here for B&B Day Pty Ltd and I will deal with it on its merits and on its face. In relation to the subpoena though to your client, it is in a different position. It is unusual to have subpoenas directed to parties to litigation.

MR BELL: Yes, well, paragraph - - -

HER HONOUR: Have you been asked for these documents?

MR BELL: Paragraph 3, your Honour, there is an admission - there is an agreed fact, I think, that B&B Day paid for - - -

HER HONOUR: Spent the $200,000; yes, there is. It is at paragraph 80 and 81 of the document that I received yesterday.

MR BELL: Yes, and therefore that issue seems to be uncontroversial in the sense that here we would get all the - presumably all the builder’s invoices and receipts and quotes and the whole kit and caboodle, in relation to what is effectively an admitted fact, that B&B Day paid for those renovations, so that - particularly given the press of time, your Honour. Then paragraphs 5 and 6 seem appropriately addressed not to Mr Day - - -

HER HONOUR: It is addressed to Mr Day. It is in the Day subpoena.

MR BELL: I know it is addressed to Mr Day. I mean, I know they are paragraphs included in the Day subpoena but they are items which - I mean the register of members of Fullarton Investments would be presumably held by Fullarton Investments. Item 7, your Honour, dealings with the parliamentary library; this seems to us, with respect, to be - there are two points, it seems not to be relevant or of the most peripheral relevance.

It may also involve a question of parliamentary privilege. I have not had a chance to look more thoroughly into that but it is a dealing between Mr Day and the parliamentary library and advice to, or communications with the parliamentary library by the Senator in the context of his office as a senator but we also do not see the relevance of that paragraph.

Paragraph 8 is again probably in the same category; an extraordinarily broad - and ultimately that is a question for the Court. It is quite irrelevant what documents he may have had in his possession that mentioned or discussed whether he had a pecuniary interest. So, they would be our submissions in respect of those paragraphs. Paragraph 1, I should have said, your Honour, goes - - -

HER HONOUR: Before you go back to paragraph 1, what about paragraph 9?

MR BELL: Well, B&B Day would have those accounts. Whether or not the annual accounts for 30 June 2016 have been prepared yet, I do not know. They either have or have not been.

HER HONOUR: Sorry, and paragraph 1?

MR BELL: Paragraph 1, your Honour - - -

HER HONOUR: If you go to 74 and 75 of the combined document, it is apparent that there is substantial agreement between the two of you.

MR BELL: Yes, and therefore, a bit like the other paragraph I mentioned, your Honour, about expenses – to the extent that there is agreement, our friends should not then be able to, in a sense, impose an obligation to produce documents relating to matters which have been agreed. That would certainly pick up a number of the matters, and 75 records what is agreed. We would submit, your Honour, that anything beyond that is simply fishing.

It has to be borne in mind that Mr Kirk has said that this is an allegation, effectively, of fraud. They really do have an obligation to have particularised that, and it is not appropriate with the allegation having been made to then seek to boost what they have got by a very broad-ranging subpoena drafted in these broad terms. They either were in a position to make the very serious allegations, or they were not. Our concern is that beyond the matters which have been agreed, they ought to have material which would sustain the allegations and therefore this is in a fishing category.

HER HONOUR: I think that argument has some merit until one reads what I think is affidavit number – sorry, I have just got to work out which number it is - one of the affidavits filed in support of the summonses or the subpoenas set out information which would seem to suggest that there is at

least a basis for pleading them now. Some of the factual matters are set out in Part V.

MR BELL: Yes, there is some hearsay material - - -

HER HONOUR: There is.

MR BELL: - - - but I am not suggesting that, in a sense, the matter should not have been pleaded, but here is an attempt to seek further documents in relation to matters, many of which have been agreed, without differentiating and in a very broad way.

One point the Chief Justice made on the last occasion, your Honour, was to caution Ms McEwen against overbroad subpoenas, in the context. With respect, we regard these four schedules of subpoenas not to have heeded the Chief Justice’s caution at all. Really, this should not become a drafting session. Our friends have had guidance as to drawing their subpoenas appropriately narrowly. They have chosen not to follow that course and now want orders of the broadest kind – not only against Mr Day, but what is effectively third party discovery against a number of other persons or parties. We would resist that, your Honour.

HER HONOUR: Mr Kirk, let us deal with the subpoena addressed today, because I think once we have dealt with that one, some of the others will fall out.

MR KIRK: Yes, your Honour. Firstly, the affidavit - - -

HER HONOUR: Ordinarily, one asks for particular documents relevant to issues in dispute.

MR KIRK: Yes. By way of background, the affidavit your Honour was referring to was the first affidavit filed by Mr Green, sworn on 18 November 2016, at paragraphs 36 and 37 on pages 6 and 7.

HER HONOUR: I know, Mr Kirk, but we are dealing with the lack of specificity in these subpoenas.

MR KIRK: Your Honour, if I can deal with the items. In relation to item 1 in Schedule 1 directed to Mr Day and also to B&B Day, my learned friend said there is a lot of agreement. I am not sure that is right, with great - - -

HER HONOUR: Paragraphs 74 and 75 of the combined document that I received yesterday?

MR KIRK: Yes, your Honour, but what is not agreed is, for example, who would be the beneficial owner of the shares in Newco; that is 1(c). What is not agreed is what role Mr Smith would have in the management of Newco, and (f) is really wrapped up in the nature of the arrangement as we have alleged it.

HER HONOUR: So you want (c), (e) and (f)? Is that the position?

MR KIRK: And also (g), I think.

HER HONOUR: But that is not in dispute, is it?

MR KIRK: Yes, your Honour, because there is this so-called vendor finance agreement which - - -

HER HONOUR: That is an objective fact which is the subject of agreement. That is not in dispute.

MR KIRK: What is in dispute is whether it was agreed around about the time, because what is contained in Mr Day’s - - -

HER HONOUR: What does “around about the time” mean? You need to be more precise than that.

MR KIRK: Mr Day’s contentions allege that it was essentially agreed at the time that Fullarton was set up, or sometime around then, but that by oversight, it was not entered at the time. In fact, it was only entered in September of this year – that is to say, signed in September of this year.

HER HONOUR: That is not in dispute.

MR KIRK: It is not in dispute they were signed this year. As to whether it was agreed at some previous time, that is in dispute, your Honour. We say, and we say so expressly in our statement of contentions, that that was only brought into existence following a request from the department, I think. I am just trying to find the reference, your Honour. Paragraph 28 refers to the agreement, and 29 explains the circumstances, including the last sentence of paragraph 29, as we put it. Certainly the last sentence of paragraph 29 is agreed – in fact, it is fiercely disputed. The relevant response in this - - -

HER HONOUR: So we delete paragraphs (a), (b) and (d) of paragraph 1 of the draft subpoena?

MR KIRK: Yes, your Honour. Moving on, I do not think my learned friend raised an issue about paragraph 2. He did about paragraph 3 - - -

HER HONOUR: Well, that is not in dispute, that B&B Day spent the money.

MR KIRK: There is a minor issue about dates, but we can seek to deal with that by correspondence so I do not - - -

HER HONOUR: Paragraph 3 is deleted, yes?

MR KIRK: If it please the Court. I do not think my friend raised an issue about 4. In relation to 5 and 6 - - -

HER HONOUR: They are not relevant to Day; they are Fullarton Investments.

MR KIRK: Yes, but that does not mean to say that Day may not hold the documents, though. If he does not, there is no harm in saying “I do not hold the documents”. This goes back to our alleged version of the arrangement which is that Mr Day had control of all these things – in which case, it is quite likely he may hold these things. If he does not, he does not, but we do not see any harm, with great respect, in Mr Day having to answer those categories.

HER HONOUR: Yes.

MR KIRK: In relation to paragraph 7, my learned friend raised two issues; one, of relevance, and two, of parliamentary privilege. As to parliamentary privilege, I accept - - -

HER HONOUR: I will not give you leave for 7. Some of the correspondence is already in. Paragraph 8?

MR KIRK: If it please the Court. It goes to knowledge, so all documents that mention or discuss whether Mr Day had or may have a pecuniary interest goes to his knowledge, which goes back to what I sought to articulate before by reference to our contentions, that it is fundamental to one part of our case to say he fully understood, certainly by June this year - - -

HER HONOUR: Sorry, is not 8 “All documents that mention or discuss whether [he] had . . . a pecuniary interest”?

MR KIRK: Yes.

HER HONOUR: Well, that is a legal conclusion. That is not categories of documents. That requires someone to determine whether or not there is a pecuniary interest. I will not give you leave for 8. It is too difficult and too wide. Paragraph 9?

MR KIRK: Your Honour, if I can be heard briefly in relation to 8, the way 8 is drafted is:

documents that mention or discuss whether [he] had . . . a pecuniary interest –

In other words, it is those two key words, “mention or discuss” whether he had a pecuniary interest. We would have thought, with respect, that is capable of ready identification by simply reading a document and seeing if it refers to pecuniary interest for the purpose of 44(v) of the Constitution.

HER HONOUR: It is not limited by period at all.

MR KIRK: That is true, your Honour, but as we understand Mr Day’s case, it is that he only realised he – I do not think he has ever conceded he has had a problem with 44(v) of the Constitution. The earliest reference we can find in the emails, I think, is in February 2016. We have referred to that in our reply document, where there is an express - - -

HER HONOUR: I will not give you leave for 8. Paragraph 9?

MR KIRK: If it please the Court. Paragraph 9 is just “annual accounts for B&B Day”. I do not think my friend - - -

HER HONOUR: Is this the same category as 5 and 6?

MR KIRK: Yes, your Honour.

HER HONOUR: Yes. Paragraph 10?

MR KIRK: Paragraph 10, I do not think my learned friend challenged. It just goes to the nature of the – sorry. My learned friend says he meant to say that would relate to Fullarton Investments, in which case it is in the same categories as 5 and 6.

HER HONOUR: All right. I will give you leave to issue a subpoena addressed to Bob Day in relation to paragraphs 1(c), (e), (f) and (g), 2, 4, 5, 6, 9 and 10 of the draft subpoena.

MR KIRK: If it please the Court.

HER HONOUR: Now, is that the same for B&B Day Pty Ltd as well? It should follow, should it not?

MR KIRK: It should, your Honour, yes.

HER HONOUR: Same for B&B Day. Then what about Schedule 4, which is in the same terms addressed to Fullarton Investments?

MR KIRK: Just before I move on, your Honour, could I just deal with the issue of form, because there is just a very slight legal technicality here. There is some room for argument as to (a) whether a subpoena can issue in the Court of Disputed Returns, but we think that is solved by rule 6.01.1, I think it is, which says in the absence of any particular manner or form, the Court can do as it sees fit. Secondly, your Honour, we acknowledge there is a formal issue - - -

HER HONOUR: Well, no, I do not think that is right, because under section 360(1), the powers include the production of documents.

MR KIRK: That was the point I was going to go to, your Honour. That speaks about production of documents. It does not use the term “subpoena”, but we would see that as a matter of form, with respect, so - - -

HER HONOUR: I do not think it is a matter of form. I think it should just be production of documents, and the draft itself can refer to section 360(1); then there is no dispute.

MR KIRK: That is precisely how we have drawn them, your Honour, and that was the point I wanted to explain.

HER HONOUR: Done.

MR KIRK: Now, your Honour was asking me about Schedule 4, directed to Fullarton - - -

HER HONOUR: Schedule 4 is to Fullarton Investments and, subject to some minor matters, is in identical terms.

MR KIRK: It is very similar. The differences are there are three categories sought from Mr Day that we have not sought here, and newer – and the number has gone awry, your Honour, I apologise for that - - -

HER HONOUR: That is all right. So 11 is the same; 12 is the same; 13, 14, 15 and 16 the same, and 19 and 18 are different?

MR KIRK: Yes. Paragraph 17 and 18 are the new ones, and they are self-explanatory.

HER HONOUR: All right. You can add those into the Fullarton Investments ones, but it will be subject to the same order in relation to B&B Day, and to the draft document to Day as well.

MR KIRK: Sorry, your Honour, so I understand – it will be mutatis mutandis as for the Day document in relation to the other categories?

HER HONOUR: Correct. Yes, it will.

MR KIRK: If it please the Court. That leaves Schedule 3 – sorry, Schedules 2 and 3 - - -

HER HONOUR: No, it leaves one to Wilson, and one to the National Australia Bank.

MR KIRK: Yes, your Honour. Schedule 2 is Wilson Colman, which are the accountants. Again, there is a degree of overlap. One is drafted not quite identically because it is picking up information received by Wilson, advice given by Wilson, or advice given by Wilson to three named persons. But otherwise, it is picking up the same matters, I think, as in 1 of Day, and so could be dealt with mutatis mutandis.

HER HONOUR: Can I ask a practical question, and that is this - as I understood the facts, until 30 June 2014, all instructions had to come from Bob Day in relation to B&B Day because he was the only shareholder and director. Can the period not be narrowed?

MR KIRK: Your Honour, save that Mr Day may not have kept all his records. There is one other point my learned junior has drawn to my attention, which is that in 1(h) for Wilson Colman – I think that is in different terms to what was directed to Day, and:

how the financial accounts of Fullarton Investments would record the payment of the price (if any) for the Property –

So if I might go through 1(d) to (j). In light of what your Honour has said, we do not press (d). We would press (e), (f), (g), (h), (i) and (j), remembering that what the item seeks is information, advice or instructions.

HER HONOUR: Paragraph 2 is just a repetition of 1, is it not? It would pick up all the documents that are referred to, and 2 would be picked up in 1.

MR KIRK: Could your Honour just give me one moment?

HER HONOUR: Certainly.

MR KIRK: I think your Honour is right, with great respect, save only for what is misnumbered (g), over the page:

the repayment of the “vendor finance loan” - - -

HER HONOUR: I think what you should do is move (g) into 1 and relabel it as (k), and then 2 gets deleted. That would be the same for 3, would it not? That is all picked up, as is 4.

MR KIRK: Sorry, your Honour, Ms Gory has just drawn to my attention – I am sorry to be a bit slow – category 2 also picks up information received by Wilson Colman from - - -

HER HONOUR: That is in paragraph 1(a).

MR KIRK: I do not think it is insofar as it captures those three named persons, because 1(c) – sorry, I see; your Honour says that might be within 1(a)?

HER HONOUR: Correct.

MR KIRK: Except that refers to Mr Day. Apologies for effectively drafting on my feet, but insofar as 1(a) included the three named persons, then that would solve the issue I have just identified, I think.

HER HONOUR: Then 3 and 4 are picked up by 1 now, are they not?

MR KIRK: Save that the old (g), which is to move, only refers to “the repayment of the “vendor finance loan””, but if it simply refers to the “vendor finance loan” and the word “repayment” was removed, then I think that would deal with 3 and 4, fortunately for me.

HER HONOUR: I will make that amendment.

MR KIRK: If it please the Court. I was just about to say, fortunately for me, Ms Gory agrees. Does that take us to 5, your Honour? I think that would also deal with 5, actually.

HER HONOUR: It would. It is the same with 6, is it not?

MR KIRK: Sorry, no, your Honour, it does not, with respect, because that refers to the subsequent transfer of shares - - -

HER HONOUR: Sorry, we are dealing with 6 now?

MR KIRK: Yes, your Honour. That deals with the transfer of shares in Fullarton Investments from the first named person to the second named person, which occurred subsequently, I think, in late 2015. That is actually a separate aspect.

HER HONOUR: Well, there is no time limit on this. Is this in relation to what period? 23 September 2015 is the transfer.

MR KIRK: Yes, your Honour, that accords with my memory. It would be in the period September 2015.

HER HONOUR: Then, in relation to 7, that would go? You have already issued it to Fullarton Investments, have you not? You do not do it twice.

MR KIRK: Well, save again that Fullarton Investments may not actually hold the documents, in that Fullarton Investments is now owned by Mr Steinert, and we do not know what his record keeping is like.

HER HONOUR: If you have not got them, you can come back and ask for them. Then 8 is picked up by 6?

MR KIRK: Yes, I think that is right, with respect.

HER HONOUR: And 9 is the same as 7. What is 10?

MR KIRK: That is the small point relating to who bore the costs incurred in connection with incorporating Fullarton.

HER HONOUR: All right. So the production of documents is to be amended in relation to Wilson as follows – these are my notes. Paragraph 1(a) is amended to include Mrs Smith, Mr Smith and Mr Steinert, (d) is deleted, and there is a new paragraph (k) added which is a variation of 2(g) with the deletion of the reference to “the repayment of”. The balance of 2, 3, 4 and 5 are deleted. Paragraph 6 is amended to read at the end “on or about 23 September 2015”. Paragraphs 7, 8 and 9 are deleted, and 10 can stay.

MR KIRK: If it please the Court.

HER HONOUR: National Australia Bank?

MR BELL: Your Honour, was your Honour going to hear from me after you have dealt with these? I mean, I have not said anything about these subpoenas. For example, I dealt with - I thought we were dealing with them seriatim.

HER HONOUR: But you have - you are not - you do not represent these people.

MR BELL: No, I do not but this is effectively third party discovery, is the point I would make. By provision - - -

HER HONOUR: Well, I think to be fair, Dr Bell, I have cut them down considerably.

MR BELL: Yes, but, your Honour, even using paragraph 1, you have got a two-year period and you have got the word, it is all:

about any of the following matters -

All that is, is replacing the “relating to” which the Chief Justice indicated on the last occasion, was inappropriate.

HER HONOUR: What do you suggest?

MR BELL: Well, it is not - I do not make any suggestion, your Honour, but other than to observe that this is - - -

HER HONOUR: Well, we do when we are trying to resolve issues.

MR BELL: Well, your Honour, in our submission, these subpoenas, these third party subpoenas, in this form are not appropriately issued. That is our submission. I mean, we have an aggressively pleaded case and a deliberately, broadly drawn third party subpoena issued in circumstances where serious allegations have been made and it looks a little like our friends are trying to play catch up and substantiating their allegations.

HER HONOUR: Anything else, Dr Bell?

MR BELL: No, your Honour.

HER HONOUR: Mr Kirk.

MR KIRK: If I might first draw to attention, your Honour, that in item 1 of Schedule 2, the first words are:

All documents that mention or record:

(a) information . . .

(b) advice . . .

and so forth:

about any of the following matters -

So, it is not just relating to, it is actually “that mention or record” any of those matters; that is the first submission we make. The second submission we make is that ultimately what these documents will go to are constitutional facts in what is self-evidently an important constitutional case, not just for Mr Day and it is very important that these facts be placed before the Court and relevant documents be placed before the Court and - - -

HER HONOUR: What about the period? It is a very long period. Do you need 13 to September 15?

MR KIRK: Well, the beginning of the period picks up immediately post the 2013 election or thereabouts and, thus, the genesis of Fullarton Investments which was about December 2015. It goes through to 29 September 2015 because that is just after when the transfer was done from Mrs Smith to Mr Steinert, as your Honour identified earlier. What is likely in - - -

HER HONOUR: But the starting date is too early, is it not?

MR KIRK: It could be certainly 1 December 2013, your Honour, I think.

HER HONOUR: Why 1 December 2013?

MR KIRK: Because Fullarton - just a moment, your Honour.

HER HONOUR: 16 December 2013, Fullarton Investments was incorporated.

MR KIRK: Yes, that is right, and Ms Gory points out to me that because it was – sorry, because it was incorporated on 16 December, some decisions and discussions must have taken place prior to that and we do not know exactly when prior to that they occurred but implicitly sometime after the 2013 election. So, on reflection, I think we do actually press 1 September 2013, your Honour. I would also add this fact that, presumably Wilson Colman has a file in relation to these matters and it is not going to be overly burdensome - - -

HER HONOUR: Well, you are not going to get the file. You get access to documents which are the subject of the order.

MR KIRK: No, I understand that, of course, your Honour.

HER HONOUR: I will leave the draft subpoena in the terms that I mentioned. Can we deal with the National Australia Bank please?

MR KIRK: If it please the Court. So, item 1 in Schedule 3, directed to the NAB relates to documents recording reasons. Item 2, because they are in some ways two sides of the same coin, relate to documents:

recording or referring to any request made of the NAB to:

(a) approve the discharge . . .

(b) approve the grant of the Fullarton Mortgage;

(c) approve the provision of any financial accommodation to Fullarton -

So, they overlap but they are logically distinct. As to one, obviously the reasons - any reasons given by Mr Day or B&B Day for the transactions which were about to occur are important or potentially important for our case. As to 3 - - -

HER HONOUR: Can you explain to what the dispute is? What is the relevant factual dispute? I mean, we know from the documents which are the subject to the reference that these arrangements in relation to Mr Day are all cross-collateralised. It is recorded in the reference itself. So, what is the issue here?

MR KIRK: The reasons given by the Day side of the transaction as to why they were about to do what they were about to do which ultimately goes back to the knowledge point, your Honour, and it also goes incidentally to the control point, actually, as to whether Mr Day retained practical control of the Fullarton Road property.

HER HONOUR: I do not understand that last bit. This is about financing arrangements.

MR KIRK: Yes.

HER HONOUR: It has got nothing to do with the property and control of the property at the moment. We are dealing with financing between National Australia Bank and B&B Day and ultimately Fullarton itself.

MR KIRK: Yes, that is all true, of course, your Honour, but insofar as documents record reasons given, it is likely - - -

HER HONOUR: I understand 1. I am trying to work out 2.

MR KIRK: Well, only that insofar as, for example, a document might say, this is what we are doing but in practical terms you are still going to dealing with Mr Day or his assistant or whomever. That would illustrate the control point, as part of recording the reasons for what was proposed for this transaction.

HER HONOUR: Well, my present view at the moment is that this draft subpoena to National Australia Bank is extraordinarily broad. I can understand 1(a), (b) and (c). The balance of it, I must say, I require some persuasion.

MR KIRK: All right, your Honour, I will briefly attempt that task, if I may.

HER HONOUR: Well, no, I think you need to think about it. It is just, it is completely broad and I do not understand why it is all needed. For example 5:

All documents . . . that mention the lease –

Well, that just cannot be relevant and what has that got to do with anything.

MR KIRK: Only that it goes to potential purposes, your Honour, again of the transaction and what was involved. As to - if I could go back to 2(c) - if I could just have a moment, your Honour. As to 2(c), your Honour, there is a degree of agreement but so far as we are aware - - -

HER HONOUR: It is a very large agreement, set out at paragraph 29 and then 78 to 79 of the combined document.

MR KIRK: Yes, but, your Honour, there is no - so far as we are aware, and I will be corrected if I am wrong, any contractual or legal documents existing between Fullarton and NAB have not been produced. We do not have them. There must be some such documents and, indeed, that is implicit in the paragraphs your Honour has just referred to, I think, but we do not have the documents. What we have got is we have got some documents - - -

HER HONOUR: Well, you did not ask Fullarton Investments for it, in the draft subpoena to them.

MR KIRK: Yes, but again, your Honour, how good the record keeping of Fullarton Investments is, we do not know. It may well be, they simply have not kept records of all these matters. So, 2(c) in particular would be a matter of potential significance, in fact to all parties, including the Commonwealth, and 3 for the same reason. Item 5, I accept, with respect, the force of what your Honour said.

HER HONOUR: Item 4 seems to be NAB’s approval. That does not seem to have anything to do with it. If you have got 3, you do not need 4.

MR KIRK: Yes, I will not say anything further about that, your Honour. In relation to 6, well that is documents recording ownership, so that goes obviously to matters which are in dispute as to beneficial ownership of the shares in Fullarton and the property. It may be that that overlaps with 1 but it is just a little specific.

Item 7 goes to a different point which is that, as we note in our contentions, our primary contentions, I think, we have suggested that the value of the Fullarton property was taken into account as part of, if I can loosely call it, the Day group, even though it was nominally, separately owned by Fullarton Investments and that has been denied or, actually more accurately, I think they say - they do not quite deny it. They say in response, we do not know what the NAB has done and, by the way, it is not relevant. Well, it plainly could be relevant insofar as it evidences the way that the bank was treating the Fullarton Investment property, no doubt it would only - - -

HER HONOUR: But it is all cross-collateralised. You can see that from the documentation at - I have numbered my pages in the reference, but if you go to what is the business letter of offer from the NAB to B&B Day as trustee for the NAB Family Trust and one goes to the other details and it is securities, it is apparent that they were all interrelated.

MR KIRK: I think that document might relate to before it was transferred to Fullarton Investments, your Honour. I do not have it right in front of me. I will try and bring it up.

HER HONOUR: It has got “2 January 2014”.

MR KIRK: Yes, and the actual transfer to Fullarton Investments – I think the transfer was signed in about September 2014 and registered in about November 2014.

HER HONOUR: Do you have the similar document from NAB in relation to the current – or the financing you are concerned with?

MR KIRK: No, we do not, and nor, as we understand it, do the Commonwealth. Indeed, it would seem critical to everyone’s case. It may

be it was not replaced, but it may be that it was. It may be it was varied, for example. But something happened to it because there was a discharge of mortgage in November 2014, and a new mortgage was entered in favour of the NAB by Fullarton Investments as the new registered owner.

HER HONOUR: I will hear from Dr Bell in relation to this NAB draft subpoena.

MR KIRK: If it please the Court.

MR BELL: Your Honour, Mr Kirk indicated that these documents were being sought because they went towards Mr Day’s purpose. What I am about to say relates both to that identified reason and also paragraphs 79 and following, which we have objected to. There is no allegation that Mr Day intentionally misled anybody. In paragraph 36 of Ms McEwen’s contentions, the allegation that he was:

recklessly indifferent as to whether the statement and declaration were true –

that is the allegation, that he was recklessly indifferent, not that he intentionally made a false statement. There is in paragraph 37 a statement that he filled out a statement and declaration to induce the electoral officer to have Family First put above the line, but that would be no doubt true of every other party who wished to be above the line. But the critical allegation is in 36, which in turn is picked up, I think, in 112 - - -

HER HONOUR: It is picked up at 112 of the combined document, by repetition.

MR BELL: Yes. Reckless indifference is one thing, but it would only be if there was some plea of deliberate purpose – that he did things with a deliberate purpose – that this inquiry which some of the allegations and this subpoena seem to be directed towards would be relevant, and there is no such allegation. It is just reckless indifference.

As we apprehend it, the case Mr Kirk wants to put as to what should happen if it is found that Mr Day did have a direct or indirect pecuniary interest is that because he was recklessly indifferent, that translates to some sort of public law fraud, and that would be a basis for the submission Ms McEwen would seek to make. We can understand how they put that reckless indifference, but it is not a case about Mr Day’s purpose. That is why we have taken issue with large numbers of those paragraphs from paragraph 79 onward which do seem to be directed to subjectivity, et cetera, but they do not translate into the reckless indifference conclusion.

Then, more specifically, with regard to the NAB, your Honour asked a question about how the NAB treated this property. That, with respect, seems to us to be entirely irrelevant.

HER HONOUR: I did not ask that. I asked whether or not there was a similar document to the letter of offer which was in existence in relation to the original financing. One of the facts and matters is whether or not the cross-securitisation continued or not.

MR BELL: Yes. There is an agreed fact, your Honour, at paragraph 29 of the agreed fact document, that the mortgage which had been granted by B&B Day over the Fullarton Road property - - -

HER HONOUR: Was discharged.

MR BELL: - - - was discharged, so it would cease to become a security. But there was a new mortgage; I think that Fullarton Investments granted a mortgage to the NAB over the property - - -

HER HONOUR: They did. It is set out in the agreement at paragraph 29.

MR BELL: That is right. That is why, with respect, we do not see this subpoena as having any particular relevance. There is an agreement that there was a mortgage which was discharged and Fullarton Investments, the registered owner, granted a mortgage to the NAB.

HER HONOUR: Yes, thank you. Anything else?

MR BELL: No, your Honour.

HER HONOUR: Mr Kirk.

MR KIRK: Briefly in reply, if I may, your Honour; first, in relation to what my learned friend said about reckless indifference. He has not quite caught it, with respect. If your Honour looks at the agreed document of facts and contentions, at paragraph 112(e), we put it in two ways:

[Mr Day] was recklessly indifferent as to whether the statement and declaration were true, alternatively, Mr Day had no real belief in the truth of what he stated in the statement and declaration -

and that then picks up what I have said about - - -

HER HONOUR: I have one question to ask you about that, which is the reason why I am considering striking it out - where do I find the alternative plea set out in your statement of facts and contentions?

MR KIRK: In the statement of contentions of fact and law in reply, paragraph 9.

HER HONOUR: Yes, I see.

MR KIRK: I should add, your Honour, that a case at point is taken as to whether or not that is strictly in reply. Could I draw your Honour’s attention to paragraph 1 of our statement in reply, where we frankly acknowledge that we had by that stage received some further information from the Commonwealth, and that was part of what led to what is alleged in paragraph 9.

HER HONOUR: I understand that, Mr Kirk, but there is an end point. The end point has come, and the width of the allegations made is no longer to be increased. The question I have got to determine is whether or not it is appropriate that this go forward. So in relation to the subpoena addressed to NAB, do you want to say anything in response to what Dr Bell said?

MR KIRK: Only that he did not answer the point that I had made, the point being that none of the parties, so far as we know – sorry, let me start that again. Neither we nor the Commonwealth Attorney, so far as we know, hold any legal or contractual or related documents between Fullarton Investments and the NAB. Plainly, some exist; some are presupposed by what has been agreed. It is appropriate that the Court have all such documents.

HER HONOUR: Only if there is a dispute about it.

MR KIRK: It would be material to all parties’ cases, we respectfully say, including the Commonwealth’s, as to what the terms of the arrangements were between Fullarton Investments and the bank. That, indeed, seems to be the heart of the Attorney’s case, as we understand it.

HER HONOUR: You do not speak for the Attorney; you speak for McEwen. If Mr Lenehan wants to make submissions, he can.

MR KIRK: But we would seek to build on what the Attorney has said, your Honour. We are going further than the Attorney, but we are not disassociating ourselves from the way the Attorney puts the case.

HER HONOUR: You will have leave to issue a subpoena addressed to NAB in terms of paragraphs 1, 2, 3 and 6.

MR KIRK: If it please the Court. Your Honour, again dealing with the matter of formality; in light of that, it is not quite a subpoena. The course we propose to adopt is to take out orders from the Registry in the terms that have fallen from your Honour this morning, and serve them today. Is that consistent with your Honour’s views?

HER HONOUR: Yes, that is right, but they will have to be addressed properly. You will need to make sure that the order – and there will need to be separate orders, I think, for each proposed person who is to be the subject of an order, and the order will need to be addressed properly in the usual way – that is, to the proper officer – so there can be no dispute about where it is going, and you will then need to prove service.

MR KIRK: Yes. If it please the Court. Unless I can assist your Honour any further.

MR BELL: Your Honour, I notice that paragraph 5 of the summons, which gives leave to Ms McEwen’s solicitors to uplift and photocopy the documents – I wonder, given the tightness of timing, if there could be a direction to the effect that the solicitor for Ms McEwen also provide copies of all documents produced to Mr Day so that that can be done once expeditiously.

HER HONOUR: What I will do is I will leave it without making an order that whoever, in effect, does the uplifting – it depends upon the volume, whether or not you want them copied three times; that is the problem. But anyway, I will leave it practically for the three of you to work it out amongst yourselves and if there is a problem, Dr Bell, you can let me know.

MR BELL: Thank you, your Honour.

HER HONOUR: Just so we are clear, where will those documents be produced?

MR KIRK: The terms in the summons was - - -

HER HONOUR: The reason why we have got problems is we have solicitors in different States, we have got counsel in different States, and then we seem to have things filed in Melbourne because there is a solicitor in Melbourne. I think we need to choose one port of call for the filing of the material so that it is not, in effect, all over the place.

MR KIRK: The only possible difficulty with that, your Honour, is the very quick timing. We have proposed production by 4 pm this Friday.

HER HONOUR: Yes.

MR KIRK: What we had in mind was actually production to any Registry of the Court, whether it is Adelaide, Melbourne, Canberra or Sydney. I recognise that is not ideal in a practical sense, but we do not want to impede any of these parties complying with the order as quickly as possible. Whether there is some other way to proceed, I am not sure, but that is what we had in mind. We have expressed it in terms of production to the Senior Registrar of the Court, Ms Rogers, but we had envisaged that being done through any Registry of the Court.

HER HONOUR: That is probably going to have to be the position but, I should warn you, I think you are better off choosing a port of call where somebody is going to be able to receive them and deal with them. That is my view. Depending upon the volume, it may be that a lot of this is going to be electronic anyway. Some of it will be electronic.

MR KIRK: Yes.

HER HONOUR: The National Australia Bank would be electronic, you would expect.

MR KIRK: Yes. If we were to nominate one, we would say Melbourne; first, because that is where the matter will be heard, but, secondly, because that is where my instructing solicitors are, and I have heard what Dr Bell has said about being practical about giving everyone access. That is obviously sensible.

HER HONOUR: Let us choose Melbourne as the port of call, but if there are difficulties for particular people who are the subject of the order, then we will just have to deal with it. That means that Melbourne are on notice, and they can let you know as soon as things are filed because, of course, they may be filed earlier.

MR KIRK: Yes.

HER HONOUR: Is that all right with you, Dr Bell?

MR BELL: Yes, your Honour. I think that probably leaves more general directions.

HER HONOUR: Yes, I am about to outline what I propose, and then the three of you can comment.

MR BELL: Thank you, your Honour.

HER HONOUR: I have made the order in relation to the reference for the earlier part. I am now dealing with what I will call the McEwen top-up facts, if there are any. As I said, the hearing of any additional fact or facts will be heard at 9.30 am in Melbourne on 23 January 2017 on an estimate of two days. What I direct is that by no later than 4 pm on 16 December – which I think is this Friday – McEwen file and serve a list of witnesses intended to be called to give evidence together with an outline of the evidence expected to be adduced from that witness. Then you can do the same, Dr Bell, by the Monday.

MR BELL: That, with respect, your Honour, is extremely tight. It is effectively, Mr Kirk has said, a fraud case - - -

HER HONOUR: Just stop for a moment. Mr Kirk is going to tell you now, so it is not public, (a) who he is going to call, and he can outline to you in general terms what it is that evidence is likely to address.

MR BELL: Very well; I had not understood that. I thought it was just the identity - - -

HER HONOUR: I have asked Mr Kirk to do that today, between counsel, so that you are on notice about who up to the three are likely to be, and what their subject matter is.

MR BELL: Thank you, your Honour.

HER HONOUR: Also by Friday, Mr Kirk, you can file a list of findings of fact that you are going to ask the Court to make by way of top-up – that is, that you would want me to make – at the end of 23 or 24 January.

Then, by 16 January, I direct that senior counsel for each party are to confer and agree and file a timetable for trial which identifies by date and time, first, the order in which witnesses will be called to give evidence, which party will call the witness, which party or parties will seek to cross-examine that witness and for how long each party will seek to examine and cross-examine.

Parties with the same or similar interests should confer and decide which party or parties will seek to do the cross-examining and, in the absence of special circumstances, parties with the same or similar interests will not be permitted to cross-examine a witness on facts and matters that have already been the subject of cross-examination. Second, the timetable should also address any other step which a party proposes should be taken at the hearing.

MR BELL: Your Honour, could I ask – the direction for Ms McEwen to do three things by this Friday, your Honour indicated 4 pm. Could I request 12 noon for this practical and logistical reason? My particular chambers are being formally closed for renovation and there is a building order in place, so I will not have access to my chambers after 5 pm, I think, on Friday the 16th. We would seek that we have that important information by noon on Friday.

HER HONOUR: Ask Mr Kirk whether there is any difficulty with that. That seems reasonable to me. Mr Kirk.

MR KIRK: In relation, your Honour, to the first thing your Honour mentioned relevant to us, namely filing and serving a list of witnesses plus outline of evidence, we can do that by noon on Friday. In relation to the second, which was a list of findings of fact by Friday, could we respectfully seek that that actually be Tuesday next week, the reason being that there will be production of documents, hopefully by the end of Friday this week. We will also have finalised the outlines of evidence, if any, and so by that stage, we will be in a position to know with some specificity, we hope, what our findings of fact will be. Otherwise, there is the danger we may have to amend or seek to supplement the findings of fact we seek.

HER HONOUR: Dr Bell, have you got any objection to that?

MR BELL: Only this, your Honour. It is a bit invidious for us to form a final view about our witnesses and their outlines before we know the findings of fact which are to be sought, with respect. I mean, I do not think I could responsibly form a view on that until I knew precisely the ambit of the facts and the nature of the facts our friends were contending for is the reality of the matter.

So there would be possibly two ways of dealing with that, if our witnesses – our indication of our witnesses went later in the week and maybe the findings came on Monday – close of business on Monday – and we had until say Thursday that would give us some time. We would also want to look at the documents as well, any documents which were produced.

HER HONOUR: No, I accept that. I think the fair thing would be if you get the list of witnesses by 12 noon on Friday, together with the outline. You will have access to the documents on Friday and over the weekend. I will have findings of fact by no later than 12 noon on the Tuesday, Mr Kirk, but they really should be as soon as possible.

MR KIRK: Yes, your Honour.

HER HONOUR: Then you can have until 12 noon on the Thursday. Is that all right, Dr Bell?

MR BELL: Thank you, your Honour. Can I clarify - - -

HER HONOUR: Is there anything – yes.

MR BELL: Your Honour, the direction about conferring et cetera, I think your Honour did intend 16 January.

HER HONOUR: I did. What did I say?

MR BELL: No, you did say January, but I knew there was 16 December also floating around but I just wanted to clarify.

HER HONOUR: No, 16 January. By then you should have spent your summer preparing, you will be able to tell me how you are going to run the trial so that we can run it efficiently.

MR BELL: That is a great prospect, your Honour.

HER HONOUR: It is a lovely prospect.

MR BELL: I look forward to it, immensely.

HER HONOUR: So do I. I cannot wait. Mr Lenehan, you have been very silent throughout this discussion, is there anything you want to add to those directions?

MR LENEHAN: Just one thing, your Honour. Your Honour had in mind that we would tidy up 67, and we will. If on receipt of any documents pursuant to Mr Kirk’s order to Fullarton Investments the income position becomes clearer, would we also have your Honour’s leave to add something as 69 which would set out precisely the position there, given that - - -

HER HONOUR: So, the order I made in relation to paragraphs 1 to 68 included an order that any other facts and matters agreed between the parties before 22 December.

MR LENEHAN: Yes, I apologise, your Honour, I missed that.

HER HONOUR: That is all right. So do you want me to reread that order?

MR LENEHAN: Yes, your Honour, if you would.

HER HONOUR: So what I suggested was that paragraphs 1 to 68 of the document headed “Areas of factual agreement and disagreement between the parties” filed with the Court on 12 December 2016 and any other facts and matters agreed between the parties before 22 December 2016 form the basis of and be included in the statement of facts referred to in paragraph 9 of the orders made by the Chief Justice on 21 November.

MR LENEHAN: Yes, your Honour, that is all I need. Can I just mention one other thing, your Honour? There was some issue on the last occasion about costs. I am instructed to inform the Court that the Attorney-General – or the Commonwealth will submit to an order that the Commonwealth pay Mr Day’s costs of the reference on a party/party basis - just to make that clear.

HER HONOUR: Thank you. Anything else, Dr Bell?

MR BELL: Yes, your Honour. The only remaining thing was your Honour has a list of those paragraphs to which we took objection. I think your Honour has indicated you would think about those – that is to say - - -

HER HONOUR: Yes. What I propose to do is I am going to leave them at the moment and wait to see what the findings of fact are that are sought and then we can deal with them on 23 January.

MR BELL: Very well, your Honour.

HER HONOUR: Thank you. Mr Kirk, anything else?

MR KIRK: No, your Honour.

HER HONOUR: Thank you. Adjourn the Court.

AT 11.48 AM THE MATTER WAS ADJOURNED