Who Says that Compliance with a Subpoena Cannot be Profitable?
Subpoenas are useful weapons in litigation. Subpoenas allow litigants to access information held by third parties that would not normally be available.
Subpoenas can be profitable, but this often comes at a price. A party issuing a subpoena must usually pay the reasonable expenses incurred by the third party in complying with the subpoena.
A third party dragged into somebody else’s litigation under the threat of being in contempt of court if it doesn’t comply with the subpoena can be compensated for the costs and expenses of compliance.
Regrettably, many people served with subpoenas aren’t aware of this and spend a great deal of time, effort and money searching for, collating and copying documents, emails and other information without any reimbursement whatsoever.
In the well-known battle between the Australian Sports Anti-Doping Authority (ASADA) and the Essendon Football Club, one of the only people to come out unscathed was a chemist who was served with a subpoena by ASADA and the AFL.
In this case, Chief Executive of Australian Sports Anti-Doping Authority Australian Football League v 34 Players and One Support Person (No 2) [2015] VSC 14, ASADA and the AFL contended that the chemist should recover costs assessed on the ordinary Court scale.
The Court disagreed and said that where a third party has been of considerable assistance to the court and was a non-party with no pecuniary interest in the outcome, they should recover costs on an indemnity basis.
This doesn’t just include legal costs relating to compliance with the subpoena. Other recoverable costs of complying with a subpoena can include costs associated with:
- locating and collating subpoenaed material (1);
- reviewing job files (2);
- airfreighting (3);
- reproducing subpoenaed material; for example, photocopying; and
- corporate or professional time; for example, where a company charges an hourly rate for its employees’ services, it may be reimbursed at the charge-out rate for time spent by its employees searching for, collating or copying documents sought by a subpoena (4).
Note: Receiving a subpoena is not a license to charge anything that the recipient wants to charge. Expenses must be reasonable and what is reasonable is determined by the facts. The onus is on the person issuing the subpoena to prove that costs being claimed are not reasonable.
Our firm was recently able to recover all of our client’s reasonable costs and expenses, including the cost of employing a team of IT specialists who were necessary to provide the required subpoenaed material.
(1) J Aron Corp v Newmont Yandal Operations Pty Ltd[2004] NSWSC 996;
(2) Ibid.
(3) Deposit and Investment Co Ltd (Receivers Appointed) v Peat Marwick Mitchell and Co (unreported, Supreme Court New South Wales, Bainton J, 8 March 1996).
(4) Ibid.
For further information and advice surrounding subpoenas, please contact Samuel McMahon or a member of our Dispute Resolution Team.
