If you are subpoenaed

Accountants and other professionals commonly receive subpoenas to produce their clients’ documents. Many subpoenas require you to spend hours collating documents, and come with a “generous” payment of $20.00. What do you do?

A subpoena is a Court order and cannot be ignored, no matter how unreasonable it is. It remains valid unless and until it is set aside, and ignoring it can get you arrested.

The money you are given with a subpoena is “conduct money”. This is just the money to cover your fares in getting to and from the Court, or couriering the documents to Court. So, if a subpoena is served in North Sydney, to produce documents to a Court in the city, $20.00 or $30.00 is all you have to be given.

The “cost of compliance” is a completely different matter. If it will take 3 hours of staff time to collate the documents, you are entitled to ask for compliance costs, being your reasonable costs in collating the documents. If the party who issued the subpoena will not agree to pay, you can make a simple application to the Court to determine the amount of the compliance costs you should be paid.

A subpoena must identify the documents to be produced. The Courts will set aside a subpoena if it is a broad fishing expedition.

A North Sydney accountant recently received a subpoena to produce “all documents showing all payments and other benefits received since 1 July, 1995 directly or indirectly by [the accountant’s client] from any company in which he holds or has held any legal or beneficial interest”. The accountant had acted for that client and his group of companies for many years.

We advised the accountant that the subpoena could be set aside, as it did not identify the documents, and left it up to the accountant to work out what documents were being asked for. We threatened the solicitors who issued the subpoena with applying to Court to set it aside. This led to an agreement to replace the subpoena with a much clearer document, and an agreement as to payment of reasonable expenses to go through the archives and collate the documents.

The bottom line is that you must take a subpoena seriously, but you can demand proper expenses for complying, and can demand that the documents be specified precisely.

For further information please contact

Ben Hemsworth  or Adam Cutri.

 

 

 

 

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