Family Court stands up for bank and removes "Today Tonight" order

The Full Court of the Family Court, in a case called A Bank and Coleiro recently rejected the approach of Federal Magistrate Harman on contempt, and how to deal with his bank. The bank appealed, successfully, against various orders made by Federal Magistrate Harman.

First appearance 7 April, 2011

The husband appeared without a lawyer, but with an interpreter. The husband had sold his home, for about $200,000, and in answering a question from the Federal Magistrate as to whether the money was still in the account of his solicitors, said "yes" through his interpreter.

There was a short break. On the matter coming back before the court, a duly lawyer appeared for the husband. It became apparent that the $200,000 had been deposited to an account of the husband's held with the bank. No bank statements were provided. The duty lawyer told the Federal Magistrate that the husband had trouble hearing, and  dementia, and that she was concerned about whether or not the husband had capacity to instruct her.

The transcript speaks volumes as to what happened next:

Can I ask you,Ms Interpreter, to explain. I want [the husband] to tell me where the$200,050 is; and if he eitherrefuses to tell me or he genuinely no longer hasthe money, he starts a gaol sentence today. THE INTERPRETER: Okay. [The husband] says that he fell sick. He put themoney in the back of the car and that when he looked forthat, they were nolonger there.
HIS HONOUR: Can you ask him is there any money left in any account with [thebank]?
THE INTERPRETER: Okay. All I have left is about $3000.
HIS HONOUR: Then can you ask him is there somebody who can bring histoiletries because he is going into a police cell in about fiveminutes time?
THE INTERPRETER: Okay. Sir, [the husband] insists he doesn’t have anymoney, okay? No, I don’t have anybody.
HIS HONOUR: Then can you please tell him he will be going to gaol until themoney is produced.
THE INTERPRETER: I don’t have any money. Somebody stole the money.
HIS HONOUR: Then can you please tell [the husband] he will be in gaol for avery long time.
THE INTERPRETER: I don’t have any money.
HIS HONOUR: I am getting the police here now. They are going to take you intocustody and put you in a cell.
THE INTERPRETER: Okay. I can’t do anything about it.
HIS HONOUR: Very well. While we are waiting for them, you need to go to thewitness box, please...

HIS HONOUR: Now after you received th[e wife's property settlement] application, the sale of that houseat [D] finished, it was sold. Do you agree with that?
THE INTERPRETER: I had to sell it because I didn’t have any more moneyto pay.
HIS HONOUR: But it was sold or the sale completed after 26 February. Doyou agree with that?
THE INTERPRETER: I sold the house before I received the papers.
HIS HONOUR: On 1 March, you deposited a sum of $200,050 with [the bank]. Doyou remember that?
THE INTERPRETER: Yes.
THE WITNESS: Yes.
HIS HONOUR: At around that time, you had opened three accounts with the [thebank]?
THE INTERPRETER: Yes.
HIS HONOUR: And after those –that money was deposited to your accounton 1 March, you would appear to have withdrawn nearlyall of it.
THE INTERPRETER: Yes.
HIS HONOUR: A number of those withdrawals occurred by telephone banking.
THE INTERPRETER: No, it’s not through the telephone, no; I went to thebank.
HIS HONOUR: So if your bank statements say that you had made withdrawals bytelephone banking, that’s not correct?
THE INTERPRETER: No, it’s not by telephone.
HIS HONOUR: Now a number of the transactions say “funds transferred toterm deposit.” Do you have a term deposit withthe [bank]?
THE INTERPRETER: No, I haven’t got an account, a term account.
HIS HONOUR: Then before we proceed any further, can I make very clear to youwhat is occurring. If I could ask you to translate that,please.
THE INTERPRETER: Yes, I did have an account there but I closed.
HIS HONOUR: You were under oath to tell me the truth.
THE INTERPRETER: I’m saying the truth.
HIS HONOUR: And [Counsel] who appears for your wife is going to make somefurther inquiries during the course of the day to get documentsfrom [thebank].
THE INTERPRETER: She can do so.
HIS HONOUR: And if those – if documents are produced by [the bank] thatshow that any of the answers you give me are not correct,you will be chargedwith perjury.
THE INTERPRETER: I’m saying the truth.
HIS HONOUR: For now, you are charged with the offence of contempt of court inthat you have with full knowledge of the applicationof [the wife] sought todispose of or conceal the funds the subject of those proceedings.
THE INTERPRETER: I hid them behind the seat of the car.
HIS HONOUR: If you could just interpret that, please, though,Ms Interpreter.
THE INTERPRETER: I took them out to get a farm.
HIS HONOUR: Very well. Do you understand, [the husband], that you arecharged with a criminal offence?
THE INTERPRETER: I’m saying the truth.
HIS HONOUR: Do you understand that you are charged with a criminaloffence?
THE INTERPRETER: I don’t understand.
HIS HONOUR: You – after you were served with [the wife’s]application, you allege you have disposed of all of the moneythat theapplication sought to divide between you and [the wife].
THE INTERPRETER: No, it’s not true, I did not do it for that.
HIS HONOUR: And until the matter is dealt with to finality, which may takesome months, you will be held in custody in gaol.
THE INTERPRETER: I can’t do anything; I have said the truth, whateverhappens.
HIS HONOUR: Do you understand that you will very shortly be going to gaol, asin today?
THE INTERPRETER: I can’t do anything; I have said the truth

His Honour then required the husband's friend, Mr B, to go from the back of the court into the witness box.

Then the bank was telephoned, and a bank officer, who was not sworn in, spoke to the court. The officer told the court that there had not been telephone banking, as appeared on the statements, but cash withdrawals, and it appeared that the wrong code had been inputted when describing the transactions on the statements.

His Honour then considered jailing the husband immediately, but put it off when a letter from the husband's GP stating that he had dementia was produced. The matter was then adjourned to another day. His Honour said:

I’m going to release [the husband] on condition thathe appear on the next occasion and that he present 120,000 bucks or hegoes togaol next time. I don’t believe for one second his story, or hisfriend’s story about 200 grand in the backof the car; not for onesecond. I would slot him for perjury now, if somebody could produce a $20 notethat shows he was lying. But I’m just unimpressed that he is served withan application, and two working days later, banks the cheque and proceedstowithdraw it by telephone banking – whether he did it or somebody else– but he must have given them the details fortelephone banking after 1March because that’s when he set up the account, as it would appear, a newcustomer of [the bank].
And the moment he is able to do that, within the space of eight working daysthe money has gone; in just enough time for it to allbe gone before the firstreturn date. So that’s the course I will take. It’s just an issueof how long. But he goesto gaol next time unless he brings 120 grand in cash,because until he can prove otherwise I’m not buying his story....

HIS HONOUR: Now, Ms Interpreter, can I ask you just tointerpret some very brief things. [The husband], we’re letting you gohome. But you need to be back here in two weeks’ time on 21 April. Thereare a number of other things you need to do in themeantime that [Ms L]will explain to you. But the two important things you need to be conscious ofis that you need to go to [W]Police Station every day to report so that I knowthat you haven’t left. And you need to bring $120,000 with you tocourt on 21 April or you will be going straight to gaol, not passing go,not collecting$200. Because I am not believing your story at all about themoney being taken from your car, and if you don’t have money here bringyour toiletries you won’t be leaving next time. I am deadly serious youwill be in gaol thistime in a fortnight if that money isn’t here. Thank you. [Ms L], and to the rest of your team, thank you for theassistance.(emphasis added)

Second appearance 21 April, 2011

His Honoursaid (Transcript 21April 2011, page 2, lines 38- 46):
HIS HONOUR:No, no. If you say that has happened, I accept that from you. I did make veryclear to [the husband] today, though, thathe brings 120 grand or he brings histoiletries because he starts his sentence today if the money is not here.
[MR H]: HE says he doesn’t have the money.
HIS HONOUR: Then I have already taken that evidence and made very clear tohim I don’t believe it. I have already convicted him. If hedoesn’t come up with the money, he starts his sentence today. 
HISHONOUR: Well, if that’s so, he will have to deal with Conlan J about that,because I dealt with it last time. It’sa done deal. Does [the husband]get a pension?..
HIS HONOUR: And [the husband]will find himself entirely deprived of the balance of that account and I will begarnisheeing his pension,and he will be starting his sentence ...
HIS HONOUR: But as I said, [MrH], I need to stand the matter in the list. [The husband] is not to leave theregistry because I hearwhat you say in relation to the findings that could orshould be made, but I have already made them. He has already beenconvicted. He has already been sentenced. I suspended it on thelast occasion. The suspension ends today. I made very clear the 120 ishere, because I don’t believe he doesn’t have it.

I suppose, being blunt, Idon’t particularly want to see the Sunday Telegraphwith a banner headlineabout the nasty Federal Magistrate who caused an elderly deaf man to getbeaten in jail, when it’s not achieving a purpose. If it achievedapurpose, well, he can cop the beating. But it’s not going to achievea purpose. So I think, certainly, that would be the course. But it’s anissue, then,of – I think, you wouldn’t have had the opportunity,yet – I haven’t look at the file, but you – no,you have,sorry. You filed a response, [Mr H]. (Emphasis added)

As Chief Justice Bryant noted:

HisHonour was ultimately persuaded by Counsel for the husband that he shoulddispense with the order requiring him to attend at thepolice station every day.Counsel for the wife indicated to his Honour that her client was sufficientlyprotected by the injunctiveorders and a restraint on the husband from leavingthe country and did not require the husband to report to the police station. His Honour’s response was (Transcript, 21 April 2011, page 12,line 39):
HIS HONOUR: Certainly. Very well, and we can burythat as well.

50. HisHonour then made an order dispensing with reporting to the police at all.
51. Whathis Honour did with the contempt application itself is not clear as it is notmentioned.

 The bank

Federal Magistrate Harman joined the bank as a party. No application had been made to join the bank. No one from the bank was given the opportunity to repond to the application before it was heard.

What his Honour said speaks for itself:

One thing I wouldpropose doing, and I’m fully conscious they’ve had no notice of it,but I don’t particularlycare about that, is join [the bank] because Ithink that’s the best way I’m doing(sic) to get them here, and Ithinkif I am incorrect in disbelieving [the husband], will give you the bestshot to protect [the husband’s] interests- - -
... I know we haven’t given any notice to [the bank], although, we did,in fact, have some person from [the bank] whose nameI can’t remember givesome evidence by telephone on the last occasion, which is how it came to bethat, in fact, we becameaware that each of the transaction descriptions on the[bank’s] banking records was wrong. So I suppose to that extent,that’sprobably the notice they’re getting. But I want to join themas a party because – if they’re disgruntled by that,well, they canappeal. They can’t get a costs order against the court. They certainlywon’t be getting one againstthe parties.
If I am incorrect in my suspicion as to the veracity of [the husband’s]evidence about what happened with his money, then, thatwill give you the bestshot to protect [the husband’s] position and seek orders against [thebank] as to anything that hashappened that may have been fraudulent but notinvolving [the husband]. And [Counsel for the wife], that will, if I’mrightabout that and there has potentially been some collusion or otherwise,that will give your client the best shot of doing somethingabout it....
:
So it’s an issue of whetherwe’re going to a conciliation conference, whether we’re simplycoming back to see what[the bank] has to say for themselves, and I will makesure, in joining them, that I express very clearly why because something thatisnot quite right has been going on at [the bank]. Seeing as they have control ofmy money and my wife, I’m not particularlyexcited about that....

I don’t want to, for the reasons I’ve already described,[solicitor for the husband], put you to the difficulty and expenseof draggingyou in to Sydney, although, it probably suits [the bank]. But probably, themore inconvenience we create for the (sic),the better.

His Honour adjourned the proceedings to June, but noted these things first:

The [Bank] is joined as a party because:

1. thematerial produced by the [bank] on subpoena purporting to be the proper businessrecords of the bank would appear to be eitherinaccurate or fraudulent;
2. evidencegiven when the matter was last before the Court would give rise to a suggestionof collusion between one or more bank offers(sic) and/or [the husband] or otherpersons;

100. theopening of the accounts and their operation relevant to these proceedings wouldappear highly unusual and would appear to involvesubstantial cash withdrawalswithin a short period of time and would not have been reported to theappropriate agency and would havethe affect to [the husband’s] knowledgeof frustrating the Wife’s application and subverting the Courtsjurisdiction.

4. Theevidence available in the mater (sic) to date would also suggest a lack of dutyof care by the bank towards [the husband] in thathe is elderly, suffers ahearing difficulty, is suggested to be affect (sic) by dementia and thetransactions which had occurredwould appear to have been assisted or undertakenby persons other than [the husband]; and
5. Ifone or all of the above are ultimately found proven by the evidence in this casethe Court will consider making orders for compensationor restitution againstthe [bank].

Third appearance 11 June, 2011


When the matter next came before his Honour in June, the bank was represented. This exchange took place between his Honour and counsel for the bank:

HIS HONOUR: And if theydon’t, there’s nothing produced and there’s a subpoenaoutstanding and I’m entitledto arrest the managing director of [the bank]right now because they have had three months to comply with the subpoena andhave chosennot to, other than to produce documents which mislead the court. And I’m not suggesting that’s deliberate but they doandthey’ve got this man arrested and put in custody.
[MS B]: Your Honour, may I take umbrage and say [the bank] did not get[the husband] arrested. As I understand, that was your Honour’sbench warrant.
His Honour then did this:

I note that a subpoena addressed to the [bank] was previously served and madereturnable 7 April 2011, and with respect to that subpoena(a) documents wereproduced by the [bank]; (b) after the matter had been dealt with and interimdeterminations made with respectto the substantive proceedings, and followingcross-examination of the husband and another witness in his case, furtherdocumentswere produced by the [bank], and an officer of that bank contacted togive evidence by phone which suggested that each of the documentsthat had beenproduced by the bank to the court in purported compliance with the subpoena didnot accurately reflect the transactionswhich had, in fact, occurred.
Next:
The material to be filed by the [bank] shall include and annexe copies of allrelevant documents, including statements, vouchers,deposit and withdrawalslips, internal memoranda or such other documents as would go to: (a) anexplanation of the discrepanciesbetween the various documents now produced, andparticularly noting that the documents initially produced suggested that most,ifnot all, of the transactions which had occurred had been conducted bytelephone banking, whereas it would now appear no such transactionhad everoccurred, and further, that such transactions as had occurred largely involvedtransfers of funds to a term deposit accountwhich it is also now suggested doesnot, and has never, existed; (b) the apparent different signatures on eachwithdrawal slip andapplication for opening an account that has been produced tothe court; (c) an explanation as to the bank’s compliance orotherwisewith financial reporting obligations regarding cash transactions in excess of$10,000.
(Transcript, 14 June 2011, pages 13-14)
...
(9) I grant leave to each of the husband and the wife pursuant tosection 121 of the Family Law Act to make such disclosure of theseproceedings and the nature of same and allegations contained therein as theyconsider appropriate,and note that any such disclosure or invitation to anymedia organisation to investigate issues relevant to these proceedings willseekto obtain information by way of interview or otherwise is (a) considered to bein the public interest, and (b) shall not constitutea breach ofsection 121.

When his Honour made the publicity order, he did so without being asked to do so by anyone, and had not sought submissions from the bank. Counsel for the bank made the point plainly:

While these are matrimonial proceedings, thebankis nevertheless entitled to some protections and to many protections which existto all entities of proceedings, be they corporationsor private citizens.

 Justices Finn and Strickland had this to say about the joinder:

123. Itwas neither appropriate nor necessary for the Federal Magistrate to join thebank at that point. However, it is apparent from whatthe Federal Magistratesaid on 21 April 2011 that he had a collateral purpose in making the joinderorder. He was using it as a wayof getting the bank to appear before him and toallow the wife to pursue a claim for “compensation or restitution”againstthe bank. Yet, it was unnecessary to join the bank to achieve thesepurposes (if indeed they needed to be achieved). The bank couldhave beenrequired to attend in the context of the alleged non-compliance with thesubpoena that had been issued, and if the wifesought to make a claim againstthe bank the rules permitted the wife to name the bank as a party to any suchproceedings, or to seekleave to do so.
124. HisHonour did give “reasons” for the joinder, and they were set out asnotations to the order of 21 April 2011 as identifiedin paragraph 117 above.However, in our view, none of the matters referred to justify a joinder order asopposed to an order in relationto the subpoena that had already issued. Indeed, as we will elaborate on later in these reasons, his reasons compriseunjustifiedassumptions on the part of the Federal Magistrate. They clearlyfollow on from inappropriate comments made by the Federal Magistrateduring thehearing on 21 April 2011 and which are revealed in the transcript from thathearing set out in paragraphs 113 and 114above.
125. Thereis also no question that the bank was not on notice of the proposedjoinder and it did not have the opportunity to either respond to the issuesraised by the Federal Magistrate or at the very least make submissions inrelation to the proposed joinder before the order was made.
126. Inmost circumstances that would raise an issue as to whether there was a denial ofnatural justice and/or procedural fairness, asclaimed by the bank....

131. Theonly difficulty with this process that we can see is that it is quite apparentfrom the transcript of the hearing before his Honouron 21 April 2011 that hisHonour was not making an order for joinder with a view to giving the bank theopportunity to attend onthe adjourned hearing date to object to the joinder.His Honour was clearly intending that the bank attend to address the issuesthathis Honour considered arose from the evidence of the husband and his friendMr B, the documents produced pursuant to the subpoena,and the“evidence” given by Mr S. As referred to earlier his Honour wasusing the joinder for a collateral purpose, andthat is demonstrated by Order 7of his orders made that day. In our view, such an order was completelyunnecessary and inappropriate.
132. Thereis also the question of the notations made to his Honour’s orders on21 April 2011 and which we have set out above. InGround 8 it is suggestedthat these are “findings” made by his Honour, and his Honour erredin making them in circumstanceswhere the bank was not represented in Court thatday.
133. Weare not necessarily convinced that these notations can be described as“findings”. They are expressed to be his Honour’sreasons forjoining the bank, but we would accept that in these reasons his Honour makes anumber of assumptions from the evidencehe had heard and the documents he hadseen which may not be entirely justified. In any event we treat them as raisingissues thatneeded to be addressed by the bank on the adjourned hearing. Weconfirm though that we do not consider that they are reasons whichwould justifythe joinder of the bank. Rather they comprise issues which should have beendealt with entirely in the context of thesubpoena that had beenissued.

Their Honours concluded that another Federal Magistrate should hear the matter, noting this portion of transcript:

What Iunderstand is this, as a chronology: [The husband] came into the Richmondbranch as a new customer on 1 March and he deposited$200,000 and $50 which wasa telephone banking fee of some kind – but $200,000. He opened thataccount – first, shouldI say, he opened two accounts, he opened somethingcalled a savings account and a basic account. The savings account was theaccountinto which the $200,000 was deposited. The basic account, as Iunderstand, is a very simple and low fee, if not no fee, account. I understandin the vernacular, it’s the sort of account used by pensioners and peopleon very low incomes because it attractsno fees. The money was deposited; theaccount was opened in his name; he was the sole signatory and the bank recordsindicatethat.
Then on a number of eight transactions, that money was withdrawn and, as[Counsel for the wife] has pointed out, it was, as the recordsindicate, over aperiod of about two weeks in various amounts from $10,000 being the lowestamount to $40,000 being the highest ofthe amounts – that was a one-off– there was one $40,000 withdrawal. Of itself, the bank, I anticipatewould say if– giving evidence, would say there was nothing unusual aboutthat; he is a customer of the bank, he is a sole signatory, hecomes in and hewithdraws his money and goes away, it’s cash and that’s the end ofit.
HIS HONOUR: Well, can I stop and say there’s a few things about it. Firstly, the bank records suggest that they weren’tcash withdrawals, theywere transfers to other accounts. So clearly the bank record is wrong.
[MS B]: I will come to that.
HIS HONOUR: I want to know whether it’s deliberately wrong, in thesense that there’s some degree of collusion, becauseevidence had alsobeen given by [the husband’s] friend and flatmate that he had introducedhim to this person who he knew well,who had helped him the past, and I want toknow ether the records are mischievously wrong or there is just some horribleaccident,either of which is ultimately going to be referred to the BankingOmbudsman to look at.
[MS B]: Your Honour, from – I was just about to come to that.
HIS HONOUR: Second, and more serious – or two further concerns –one which probably isn’t this court’s businessbut there is noevidence at all to suggest, and it wouldn’t have been the case based onwhat they are shown as in the recordof [the bank], proper accounting inrelation to the reporting of those transactions – all being withdrawalsand cash of over$10,000 – which is a serious breach of the law by [thebank] and I’m not the Family Court, I’m the FederalMagistrate’sCourt, so I have power to deal with those issues and proposeto.
Thirdly, and the most important, is having cited the various transactionslips that have been produced, which wouldn’t havebeen required if theywere telephone banking transactions and transfers to accounts which it appears,from what we were told fromthe evidence of the banking officer, don’tactually exist, the signatures – not one of them actually looks like theonethat preceded it. There are a variety of signatures – I’m nohandwriting expert, but they sure don’t all looklike the sameperson’s signature.
So I have a real concern that there is either some collusion or a very graveinterference with [the husband’s] rights, whichhad impacted on [thewife’s] and [Counsel for the wife] will certainly be given leave today, ifshe wants to, to amend herapplication to seek orders against [the bank] tocompensate here, because [the husband] gave evidence he was fully aware of theseproceedings, he had been served with the documents and, having been served withthem and in total frustration, deliberately or otherwiseand with or withoutcollusion by employees of [the bank], has entirely frustrated her claim.
[MS B]: All right. Well, your Honour, if I can take it through in thisway. There are eight withdrawals. Four of them - - -
HIS HONOUR: But why hasn’t someone put this in affidavit form becausethat’s how we work.
[MS B]: Well, your Honour, because [the bank’s] position, primaryposition is that it has no business being here because noparty, at this stage,has sought an order against it and it’s primary application is that it be- - -
(Transcript, 14 June 2011, pages 4-5)

137. TheFederal Magistrate can then be seen as inviting Counsel for the wife to make anapplication for an order against the bank by saying:

Then give meone moment. [Counsel for the wife], do you want to seek an order against [thebank]?
(Transcript, 14 June 2011, page 5)

138. Counselfor the wife responded:

I do, your Honour. I want to reserve aright at least to amend the application that should [the bank] – shouldyour Honour makea finding that there has been collusion or whatever, myclient would reserve her right to amend the application accordingly to seeksomemoney against – some damages against [the bank] effectively.
(Transcript, 14 June 2011, pages 5-6)

139. Thefollowing exchange then occurred between the Federal Magistrate and Counsel forthe bank:

[MS B]: Well, your Honour, if that’s the case,then so be it but we should put the cart before the horse; that is to say, theapplication against [the bank] should be made. The evidence in support of thatapplication should be put before [the bank] an thecourt of course and then [thebank] can respond in the light of the application made against it and theevidence as opposed - - -
HIS HONOUR: Why aren’t I entitled to deal with this on the basis [thebank] is in receipt of a subpoena which, on the face ofit, it has not compliedwith, because the documents that are provided are entirely at odds with the oralevidence of an officer from[the bank] who says those documents do not reflectwhatsoever what occurred. So there has been no compliance with thesubpoena.
[MS B]: Your Honour, I don’t understand, I’m not in aposition to respond to your Honour. I didn’t hear what theofficerof [the bank] said. So far as my instructions go, the bank has answered thesubpoena.
HIS HONOUR: They provided documents purporting to be in answer but I’mthen told by the very officer who produced them who thenemailed through anumber of other documents which showed that those which had been provided to thecourt are entirely false. Whethermaliciously so or otherwise, I reallydon’t care. They were simply not a proper reflection and could not be abusiness recordbecause it’s conceded by he who produced them that theyare not a proper reflection of the transactions that occurred, thereforetherehas been no compliance with the subpoena. And I want an explanation in writingand on oath by somebody about it because nexttime we come back, I can assureyou, those seats are all going to be full of media. [The bank] has donesomething here, whethernegligent or malicious, but something has happenedthat’s removed $200,000 from this man’s hands and removed, as aconsequence,$200,000 from [the wife’s] hands.
[MS B]: Well, your Honour, may I say that your Honour may haveprejudged the issue in those circumstances if that is your Honour’sattitude.
HIS HONOUR: Not at all. Your bank officer made clear that the documents thatwere produced purporting to be business records of [thebank] do not reflect atall the reality of what occurred. I am very concerned about that because I havejurisdiction much greaterthan a Family Court judge. I can deal with financialtransaction reporting. I can make a finding right now that [the bank] hasbreached the law in terms of financial transacting by allowing 10 to 40 thousandcash withdrawals without having reported them. There are consequences for that.I have a power under the Corporations Act to deal with it.
[MS B]: Your Honour, I trust you are not going to make that ordertoday.
HIS HONOUR: Not today. I’m going to give [the bank] the chance tofile proper sworn evidence about it.
(Transcript, 14 June 2011, pages 6-7)

140. Thenafter he had questioned the solicitor for the husband as to whether the husbandwould be seeking relief against the bank, whichwas a question that thesolicitor was not in a position to answer, his Honour suggested that the bankhad not fully complied withthe subpoena in the followingexchange:

HIS HONOUR: And if they don’t, there’s nothingproduced and there’s a subpoena outstanding and I’m entitledtoarrest the managing director of [the bank] right now because they have had threemonths to comply with the subpoena and have chosennot to, other than to producedocuments which mislead the court. And I’m not suggesting that’sdeliberate but they doand they’ve got this man arrested and put incustody.
[MS B]: Your Honour, may I take umbrage and say [the bank] did not get[the husband] arrested. As I understand, that was your Honour’sbench warrant.
HIS HONOUR: They did because I made a finding based on accepting the accuracyand validity of the documents produced as business recordsby [the bank] andaccurate faithful representations of the transactions which had occurred to findthat [the husband’s] evidencewas fanciful and not to be accepted andaccordingly he had lied under oath and he was charged with contempt andarrested. If [thebank] had thought to produce the documents which, at myinstigation, not [the bank’s], four hours later were produced, andtheconcession made that the documents we have sent are completely inaccurate, hewouldn’t have been arrested. I detainedhim, I deprived him, in terms oftalking about rights of private citizens, of his right of liberty. He wasretained in custody forfour hours until that happened caused by the document[the bank] produced which was clearly false. I don’t say false to suggestmeaningfully so but it was false and I would have thought it’s a matter ofreal concern to [the bank] to have produced somethingthat tells me how the hellthat happened.
[MS B]: Your Honour, if I can only say again, and I would say this toprotect my client’s interests, two things, firstly myclient needs to havesome considered – some time to consider the evidence brought against it. It has not had the opportunityto read the transcript and all of our so to speakducks are not in a row. That needs to be done. It’s of no use to thecourtotherwise and for evidence to be put on which is in a sworn form uponwhich your Honour can rely, draw inferences and the like andI wouldsecondly simply reiterate, as I must in order to discharge my duty to my client,in saying [the bank] did not cause [thehusband] to be arrested. Your Honour, there is a chain of reasoning certainly inyour Honour’s decision to issue an arrestwarrant to [the husband]but I would simply say, to protect my client’s interests, [the bank] didnot cause that to occur.
HIS HONOUR: I didn’t issue an arrest warrant, I convicted him andimprisoned him.
(Transcript, 14 June 2011, pages 8-9)

141. Lateron the same day the following further exchanges occurred between the FederalMagistrate and Counsel for the bank:

[MS B]: Well,your Honour, because your Honour has no evidence of that before you asyet. The bank needs to put on evidence - - -
HIS HONOUR: But I do - - -
[MS B]: - - - as to what has – may I- - -
HIS HONOUR: - - - because the banking officer to whom I spokeemailed to my associate, and they were admitted as exhibits the proceedings,thewithdrawal vouchers which then made very clear that they had never been atelephone banking transfer to a term deposit that neverexisted.
[MS B]: Well, your Honour - - -
HIS HONOUR: They were cash withdrawals over the counter.
[MS B]: Your Honour is going one step further, if I may say, by this: it is no longer a case of [the bank] not answering or answering,as the case maybe, a subpoena. Your Honour is now making or moving towards making ordersand findings against [the bank]. But circumstancesin which those earlierdiscussions with your Honour – and of course, I am flying in thedark, your Honour, because I wasn’there and that is the very point. [The bank] was not represented in those proceedings. It was answering asubpoena. It was assistingthe court so far as I understand. Your Honouris, may I say, and I don’t with to be in any way disrespectful, but atriskof prejudging [the bank]. Let [the bank] put on - - -
HIS HONOUR: No, I am not going to make any order about- - -
[MS B]: If I may - - -
HIS HONOUR: - - - the apparent inconsistencies. I am going torefer them to the Attorney-General - - -
[MS B]: Well - - -
HIS HONOUR: - - - to be appropriately investigated- - -
[MS B]: Certainly, your Honour has all those - - -
HIS HONOUR: - - - and if he considers it appropriate,prosecute it.
[MS B]: Your Honour has many powers and I wouldn’t suggest for onemoment to detract from them. But [the bank] needs to understandthe case thatis being brought against it, needs to be given the opportunity to put onevidence to explain the situation. It mayvery well be, your Honour- - -
HIS HONOUR: You have had since 21 April.
[MS B]: - - - that once evidence has been placed before thecourt and [the bank] has been properly cross-examined and so forth onthatevidence, that it may be that the concerns your Honour has are not nearlyeither as – that may not be founded at all orthey may not nearly be asserious as your Honour suggests, in which case, the making of this into aToday Tonight story by allowingthe parties to go to the media only prejudices,and may I say, potentially degrades the integrity of the proceedings because atthisstage, all of this is untested; and at this stage, it is out of context; and prior to now, [the bank] has not been representedin the proceedings.
HIS HONOUR: But what I do have a context of are two sets of documentsprovided on the same day which cannot both possibly stand together.
[MS B]: Well, that may be - - -
HIS HONOUR: There is an issue about the integrity not of these proceedings,but of the banking process.
[MS B]: But your Honour, that is a matter of evidence.
HIS HONOUR: I am entitled to receive a business record from [the bank] that Ican rely upon, and on the first instance did in sentencingto a period ofimprisonment an elderly gentleman who it subsequently transpires may or may nothave dementia.
[MS B]: Well, your Honour, that may be – look, all of that may beso or not so.
HIS HONOUR: To then be provided with a document on the same day that says,“Sorry, that is not right.”
[MS B]: Well, your Honour, it may be that there was human error. Thesethings do exist in a big corporation - - -
HIS HONOUR: They do.
[MS B]: - - - as much as they do in any household or it mayhave been something else.
HIS HONOUR: The problem is I can understand if it was a transaction.
[MS B]: But we need to find out. These are matters of evidence. I’msorry, your Honour?
HIS HONOUR: If it was a transaction, I would understand. But it is everytransaction.
[MS B]: Well, your Honour, I take issue with that and I would say, onthe evidence, it is not every transaction.
HIS HONOUR: All right.
[MS B]: But I am not going to give evidence from the bar table because I canfeel - - -
HIS HONOUR: It is the majority of them. Telephone banking transfers to aterm deposit in [the husband’s] name. He has neverused telephonebanking, he doesn’t have the facility on his account and he doesn’thave a term deposit.
[MS B]: Well, your Honour, I take issue with two of the – well, infact, I take issue with two of those things and I agree withthe third. Butthose are matters of evidence.
HIS HONOUR: Good. Well, the bank should have put it on before today. Didn’t need me to make an order about it.
[MS B]: Well, your Honour, before today, there has been no applicationagainst the bank. The bank has nothing to answer as yet.
HIS HONOUR: But there is a subpoena which the bank has not complied with. Wehave visited that issue. The bank cannot produce documentswhich they thenconcede are not an accurate business record and say they had complied.
[MS B]: Your Honour, until an application is made against the bank, thebank has nothing to put evidence on about - - -
HIS HONOUR: They have an obligation to comply with a subpoena or explaintheir inability to do so. They haven’t. As I said,I am happy to arrestthe director - - -
[MS B]: Very well, your Honour. I hope you won’t be doing that.
HIS HONOUR: - - - because they haven’t complied.
[MS B]: But perhaps if we can just revert to a timetable for filingevidence.
HIS HONOUR: We have got that.
[MS B]: And the matters can be ventilated.
HIS HONOUR: We have got that.
[MS B]: Thank you.
HIS HONOUR: But we are getting to the bottom in these proceedings of what hasgone wrong in this case and I am not trying to prejudgeor suggest it isnecessarily collusive. I don’t know. But I am dismayed that a bank– and the bank that I bank with– can produce records that are thatinaccurate, and then expect that this court is not going to pay attention ...(emphasis added)

The contempt charge

Chief Justice Bryant was just as critical, but on this point. Her Honour stated:

19. In light of these well established statements of principle and the Rules of theFederal Magistrates Court a fair hearing of the chargeof contempt in the faceof the Court requires the following steps to be taken:
    • First set outthe charge which can be done orally or in writing. However it is essential thatthe alleged contemnor understands thecharge that is being laid.
    • Consider whetherit is necessary to take the exceptional step of proceeding to hear the charge orwhether the charge should then beadjourned so it can be heard before anotherjudicial officer.
    • To afford thealleged contemnor the opportunity to consider the charge and to adjourn for thatpurpose if necessary.
    • To givethe alleged contemnor the opportunity to state whether he or she pleads guiltyor not guilty to the charge.
    • To determinewhether the charge requires the alleged contemnor to be held in custody and tohear submissions on the issue.
    • In the event thealleged contemnor pleads not guilty to give him/her the opportunity to presentevidence and make submissions relevantto the defence and determination of thecharge.
    • Having heard thedefence to determine the charge beyond reasonable doubt and if establishedconvict the alleged contemnor.
    • To make an orderfor punishment if convicted, or discharge if not.
    • If sentencing,to have regard to relevant sentencing principles.
    • To give reasonsfor the decision to convict and sentence.
20. Itis apparent from the transcript that his Honour failed to comply in almost allrespects with the Federal Magistrates Court Rules and with the well establishedauthorities in relation to the manner in which contempt in the face of the Courtis to be conducted. However to explain what occurred it is necessary toconsider in some detail how the matter unfolded before hisHonour.

Her Honour then noted as to the appearance in June, commencing with a passage of transcript with the bank's counsel:

[the bank] did notcause [the husband]to be arrested. Your Honour, there is a chain of reasoning certainly inyour Honour’s decision to issuean arrest warrant to [the husband]but I would simply say, to protect my client’s interests, [the bank] didnot cause thatto occur.HIS HONOUR: I didn’t issue an arrest warrant, I convicted him andimprisoned him. (My emphasis)

53. Thatstatement by his Honour is startling because as I have previously observed, itis obvious no proper procedure to arrive at aconviction and imprisonment hadtaken place. However it accords with the order that his Honour made, which hadthe character ofpunishment for contempt rather than a remand until the contemptcould be heard. If that is so, it needs no further comment to demonstratetheclear and unambiguous failure to comply with the Federal Magistrates CourtRules, established authority and basic tenets of procedural fairness. Theadmission from his Honour that he had convicted and imprisonedthe husbandreveals that he failed:
    • to allow thehusband to plead to the charge;
    • to afford thehusband an opportunity to get advice or be heard;
    • to allow thehusband to call evidence in relation to the charge;
    • to make findingson the evidence to determine whether the charge was proven beyond reasonabledoubt;
    • to make a formalconviction;
    • to properlysentence;
    • to give reasons.
54. Judgeshave significant powers which must be exercised judicially. In particular, thedeprivation of the liberty of an individualis something not to be treatedlightly by ignoring Rules and procedural fairness or by being used as a weaponwith which to threatena party as a means of seeking to achieve an end.
55. Iam conscious that no appeal by the husband was brought against his assertedconviction (and that his capacity to conduct proceedingsstill remainsuncertain) and that there is no contradicter to support the manner in which theFederal Magistrate conducted the proceedings. Accepting those caveats howeverthe transcript itself makes clear the flaws in the process adopted by theFederal Magistrate.
56. Thewider interests of public confidence in the administration of justice andexpectation that judicial officers will not act arbitrarily,has caused me totake the unusual step of commenting on the process adopted by his Honour inrelation to the contempt charge againstthe husband, absent an appeal againsthis orders.