Boys, Alan Harold & Ors v Australian Securities Commission & Ors [1996] FCA 336

C A T C H W O R D S

PRACTICE AND PROCEDURE - production and inspection of documents - public interest immunity - correspondence sent and documents furnished to Australian Securities Commission by Receiver and Manager of company - Receiver/Manager in course of suing (in company's name) applicants in Supreme Court of Western Australia - applicants suing the Commission and the Receiver/Manager and his solicitor - applicants contending that Commission entered into arrangement with Receiver/ Manager and, acting for an improper purpose, unlawfully expanded scope of an investigation to enable appointment of Receiver/Manager and his solicitor as consultants to the Commission - allegation that Commission thereby intended to and did in fact obtain financial benefit of receiving consultancy and other services free of charge - Commission proposing to consider releasing transcripts of examinations and other documents to the Receiver/Manager and his solicitor - applicants seeking to restrain such release - Judge's discretion to inspect documents - purpose of such inspection - whether claim to public interest immunity sustained - balancing exercise - whether harm would be done by production of the documents - whether administration of justice would be impaired - whether production and inspection should be permitted upon strict confidentiality terms.

Australian Securities Commission Act 1989 ss.13, 127

Alister v. The Queen (1984) 154 CLR 404

Sankey v. Whitlam (1978) 142 CLR 1

Zarro v. Australian Securities Commission (1992) 36 FCR 40

Sayer v. National Mutual Life Association of Australasia Ltd (1994) 34 NSWLR 132

National Australia Bank v. Saunders (1988) 12 NSWLR 623

Conway v. Rimmer [1968] AC 910.

Burmah Oil Co v. Bank of England [1980] AC 1090

ALAN HAROLD BOYS, RONALD GEORGE HOWARD, DESMOND FRANK CRAWLEY, ANTHONY HAYES DOUGLAS-BROWN, ANTHONY HOWARD LEIBOWITZ v. AUSTRALIAN SECURITIES COMMISSION & Ors

No. WAG 123 of 1994

CARR J

PERTH

9 MAY 1996

IN THE FEDERAL COURT )

OF AUSTRALIA )

WESTERN AUSTRALIA )

DISTRICT REGISTRY ) No. WAG 123 of 1994

GENERAL DIVISION )

B E T W E E N : ALAN HAROLD BOYS, RONALD

GEORGE HOWARD, DESMOND

FRANK CRAWLEY, ANTHONY

HAYES DOUGLAS-BROWN,

ANTHONY HOWARD LEIBOWITZ

Applicants

and

AUSTRALIAN SECURITIES COMMISSION

First Respondent

and

ERNST & YOUNG (A FIRM)

Second Respondent

and

PHILLIPS FOX (A FIRM)

Third Respondent

and

PETER REYMOND QUIGLEY

Fourth Respondent

and

KEVIN LEE CHRISTENSEN

Fifth Respondent

CORAM: CARR J.

PLACE: PERTH

DATE: 9 MAY 1996

MINUTES OF ORDERS

THE COURT ORDERS THAT:

1. The first respondent produce to the applicants' counsel and solicitors documents numbered 121, 125, 128, 142, 143 and 144 in the first respondent's substituted
list of documents filed on 5 May 1996 ("the confidential documents").

2. The confidential documents shall until further order be kept confidential and in particular -

(i) access to the confidential documents shall be limited to the applicants' counsel and solicitors;

(ii) the confidential documents shall only be photocopied under the direct supervision of one of the applicants' solicitors. Each such photocopy shall forthwith be marked with a prominent stamp bearing the words "confidential exhibit" in large print and a short reference to the fact that the document is the subject of a confidentiality order and that photocopying and other restrictions apply. All such photocopies are to remain in the possession, custody and control of the first applicant's counsel or solicitors;

(iii) in the event that the applicants' legal representatives require to divulge the contents of the confidential documents to any person for the purpose of conducting this application, the applicants have liberty to apply for the variation of this order for such purpose.

3. The costs of the motion be the applicants' costs in the cause.

NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT )

OF AUSTRALIA )

WESTERN AUSTRALIA )

DISTRICT REGISTRY ) No. WAG 123 of 1994

GENERAL DIVISION )

B E T W E E N : ALAN HAROLD BOYS, RONALD

GEORGE HOWARD, DESMOND

FRANK CRAWLEY, ANTHONY

HAYES DOUGLAS-BROWN,

ANTHONY HOWARD LEIBOWITZ

Applicants

and

AUSTRALIAN SECURITIES COMMISSION

First Respondent

and

ERNST & YOUNG (A FIRM)

Second Respondent

and

PHILLIPS FOX (A FIRM)

Third Respondent

and

PETER REYMOND QUIGLEY

Fourth Respondent

and

KEVIN LEE CHRISTENSEN

Fifth Respondent

CORAM: CARR J.

PLACE: PERTH

DATE: 9 MAY 1996

REASONS FOR JUDGMENT

Introduction

This is a motion on notice by which the applicants seek orders that the first respondent, the Australian Securities Commission ("the Commission") produce for inspection six specified documents ("the Documents"). The Documents have been discovered in the Commission's list of documents, but the Commission objects to producing them on the grounds of public interest immunity.

Factual Background

In their originating application the applicants, who are the relevant partners of Messrs Horwath & Horwath, being the former auditors of a company called Geneva Finance Ltd ("Geneva"), seek certain declarations and orders under the Corporations (Western Australia) Act 1989 or further or alternatively under the Administrative Decisions (Judicial Review) Act 1977 (Cth) ("the ADJR Act"). In summary, the applicants seek to restrain the release, disclosure, or use of certain documents (including transcripts of certain statutory examinations) and other information which is said to be confidential ("the Transcripts and Documents").

I set out below what is, in essence, a summary of the relevant allegations made in the statement of claim.

On 11 June 1986 Geneva and Perpetual Trustees WA Ltd ("Perpetual") executed a deed of trust ("the Trust Deed"). Under the terms of the Trust Deed, Perpetual was obliged to hold certain funds for the benefit of debenture stock holders who had
advanced moneys to Geneva.

On 26 July 1990, acting under the terms of the Trust Deed, Perpetual appointed the fourth respondent, Peter Reymond Quigley as Receiver and Manager of Geneva. Mr Quigley was at all material times a partner in the second respondent, Ernst & Young. Mr Quigley retained Ernst & Young to provide accounting and other services in connection with his appointment and also retained Kevin Lee Christensen (the fifth respondent) and his firm Phillips Fox (the third respondent), to provide legal advice and assistance in respect of matters arising out of his appointment as Receiver and Manager of Geneva.

In or about January 1991 the Commission, acting under s.13 of the Australian Securities Commission Act 1989 ("the ASC Act"), authorised an investigation into Geneva's affairs ("the ASC Geneva Investigation"). The applicants allege that at about the same time, and at all other material times, the Commission was contemplating an investigation of Perpetual's conduct in relation to the affairs of Geneva. On 11 April 1991 Mr Quigley applied to the Commission to be appointed as a prescribed person, under s.597 of the Companies (Western Australia) Code for the purpose of examining the applicants and their employees before a Court and obtaining transcripts of those examinations so that they could be used in connection with contemplated civil litigation for negligence against the applicants "in furtherance of the interests of Perpetual".

The applicants allege that in or about December 1991 the Commission and Mr Quigley agreed that instead of Mr Quigley proceeding with his application for permission to
carry out Court examinations, they (that is, the Commission and Mr Quigley) would adopt a different strategy, referred to in the pleadings as "the ASC Consultancy Strategy". The applicants claim that the essential parts of the ASC Consultancy Strategy were that:

. the Commission would use its power under s.19 of the ASC Act to summon for examination those persons, including the applicants, whom Mr Quigley had intended to examine;

. the Commission would formally appoint Messrs Quigley and Christensen as consultants to the Commission so as to permit them to ask questions of the proposed examinees and to permit them to be present at the examinations;

. Mr Quigley would obtain access to the transcripts of the examinations at their conclusion by making an application personally or through Mr Christensen to the Commission under s.25 of the ASC Act for release of those transcripts, which the Commission would grant;

. the Commission would expand the scope of its authority in respect of the ASC Geneva Investigation so as to authorise investigation by the Commission of negligence on the applicants' part; and

. Messrs Quigley and Christensen would not charge the Commission for their services as consultants to the Commission, as Perpetual would pay Mr Quigley who in turn would pay Mr Christensen.

The applicants plead in their statement of claim that the ASC Consultancy Strategy was carried out. The ASC Geneva Investigation was extended, Messrs Quigley and Christensen were appointed as consultants to the Commission and notices were issued to the applicants to deliver up nominated documents and to attend for oral examination. The second and fifth-named applicants delivered the documents to the Commission and they and some of their employees and former employees were orally examined in
private pursuant to compulsory witness notices. Messrs Quigley and Christensen examined the documents produced by the applicants and Mr Christensen, in Mr Quigley's presence, conducted private oral examinations of the second and fifth-named applicants. The Commission made verbatim transcripts of the examinations. On 9 April 1992 Mr Quigley applied to the Commission for copies of the transcripts and some or all of the applicants' documents to be released to himself, Mr Christensen and Phillips Fox. Between April and July 1992 the Commission decided to allow the release of the Transcripts and Documents to those respondents, and did so. Mr Quigley and Mr Christensen are said to have used the information so obtained to institute Supreme Court proceedings in Geneva's name against the applicants and another. That was in 1993. In or about March 1994, after the applicants complained to the Commission, it requested and obtained the return of the documents referred to above and also requested Messrs Quigley and Christensen not to use any such documents or information until a decision was made by the Commission to re-release that information and documentation to them. On 12 May 1994 Mr Quigley and Phillips Fox made a further application to the Commission to release the Transcripts and Documents to them. On 13 July 1994 the Commission advised the applicants of that further application and invited them to make submissions on the question whether the Transcript and Documents should be released to Mr Quigley and Phillips Fox. Subsequently the Commission advised the applicants' solicitors that it would "not decline to consider" the further application by Mr Quigley and Phillips Fox. On 31 October 1994 the applicants sued the respondents in this Court to obtain the relief which I have described above.

Mr A. Siopis, counsel for the applicants, summarised his clients' case as being that the Commission is now disqualified from entertaining Messrs Quigley and Christensen's application to release the Transcripts and Documents. Among other reasons, so it would be argued at the hearing of the application, this was because the Commission acted for an improper purpose and unlawfully in expanding the scope of its initial investigation to facilitate the appointment of Messrs Quigley and Christensen so that it could obtain the financial benefit of not having to pay for the services of lawyers and consultants. Thus not only was there an improper purpose but a financial benefit to the Commission whereas s.90 of the ASC Act provides that the Commission shall pay the expenses of an investigation. Furthermore the Commission having accepted a benefit from Messrs Quigley and Christensen's appointments could never, so it was claimed, bring a fair mind to the application for release of the Transcripts and Documents.

The Motion

The Documents, which the applicants seek to inspect, are described in the first respondent's list of documents as follows:

________________________________________________________________________

No. Date Copy/Original Description

121 16 January 1991 Original Letter from Peter Quigley to ASC - Preliminary section 324C report.

125 9 April 1991 Original Letter from Peter Quigley to ASC concerning matters raised in section 324C report.

128 29 May 1991 Original Letter from Peter Quigley to ASC. Information concerning breach of
section 564 of Companies Code with enclosures.

142 11 December 1991 Copy Letter from Peter Quigley to ASC regarding breaches of sections 107 and 285 of the Code with enclosures (copy of document 143).

143 11 December 1991 Original Letter from Peter Quigley to ASC regarding breaches of sections 107 and 285 of the Code (annotated).

144 18 December 1991 Original Letter from Peter Quigley to ASC regarding breaches of sections 107 and 285 of the Code.

____________________________________________________________

The Documents originally formed part of some ninety-one documents which the Commission claimed were immune from disclosure in the public interest, on grounds which were set out in the Commission's affidavit verifying its list of documents. That affidavit included the following paragraphs relevant to production and inspection of the Documents:

"36. Documents 121, 125, 128, 142, 143 and 144 were prepared pursuant to Peter Quigley's statutory obligations under section 324C of the Code or alternatively section 422 of the Corporations Law. These documents provided information to the first respondent in relation to suspected breaches of the law by persons associated with GFL [a reference to Geneva].

37. These reports are treated as confidential by the first respondent.

38. These documents contain information concerning the private and confidential affairs of Peter Quigley in his capacity as receiver and manager of GFL, namely the circumstances in which claims may be pursued against other parties including the applicants in this proceedings (sic).

39. To supplement information contained in documents 121, 125, 128, 142, 143 and 144, Peter Quigley, or alternatively Lee Christensen sent to the first respondent either attached to those documents, or separately, copies of requests by Peter Quigley to his legal advisers for legal advice and copies of replies to those requests. These documents are documents 114, 115, 116, 118, 119,
123, 124, 127, 130, 136 to 139 inclusive, 166, 201, 202 and 205. These documents also contain information concerning the private and confidential affairs of Peter Quigley in his capacity as receiver and manager of GFL, namely the circumstances in which claims may be pursued against other parties including the applicants in these proceedings.

*40. If the first respondent was required to disclose the contents of the said reports or of the legal advice given to other parties and requests therefor, then the fact of such disclosure would tend to discourage full compliance with section 422 of the Corporations Law. Receivers would be discouraged from providing to the first respondent in such reports information concerning facts in relation to which that receiver suspected or believed he or she had an (sic) cause of action for the benefit of that receiver's appointor.

*41. The disclosure of the contents of the said documents would damage the first respondent's capacity to acquire information relevant to the investigation of suspected criminal offences and consequently would damage its capacity to effectively and efficiently investigate the same. Peter Quigley objected to the disclosure of the contents of the said documents by the first respondent.

42. ...

*44. I have had three and a half years experience in corporate investigation. Prior to that I worked as an investigator for the Australian Security Intelligence Organisation for five years. In addition I hold a law degree and was admitted to practice in 1979. I have formed the opinions set out in paragraph 34, 40, 41 and 43 on the basis of this experience and after a careful consideration of the contents of the documents to which those paragraphs refer. In my opinion, the disclosure of those documents would be likely to prejudice future investigations by inhibiting the willingness of members of the community to give information to the first respondent in confidence.

[*The applicants objected to the admission of these paragraphs into evidence.]

The applicants have made it clear that they do not seek production of the enclosures to any of the Documents insofar as they comprise legal advice to Mr Quigley. Nor do they seek access to any legal advice which Mr Quigley may have obtained in relation to the Supreme Court action, which may be set out in the body of the Documents. The applicants agree that that advice can be blanked out from any documents so
produced for inspection.

Whether I Should Inspect the Documents?

The principles to be applied in resolving this motion are summarised in the judgment of Gibbs CJ in Alister v. The Queen (1984) 154 CLR 404 at p.412 where the Chief Justice referred to Sankey v. Whitlam (1978) 142 CLR 1 as establishing:

"...that when one party to litigation seeks the production of documents, and objection is taken that it would be against the public interest to produce them, the court is required to consider two conflicting aspects of the public interest, namely whether harm would be done by the production of the documents, and whether the administration of justice would be frustrated or impaired if the documents were withheld, and to decide which of those aspects predominates. The final step in this process - the balancing exercise - can only be taken when it appears that both aspects of the public interest do require consideration - i.e., when it appears, on the one hand, that damage would be done to the public interest by producing the documents sought or documents of that class, and, on the other hand, that there are or are likely to be documents which contain material evidence. The court can then consider the nature of the injury which the nation or the public service would be likely to suffer, and the evidentiary value and importance of the documents in the particular litigation. But the anterior question arises - should the court look at the documents to assist it in answering these questions?"

Mr C Colvin, counsel for the Commission, said that his client was not contending that some prima facie position must be reached before I inspected the Documents. Rather, so he submitted, I should only exercise my discretion [being the discretion conferred by Order 15 rule 14 of the Federal Court Rules] to inspect the Documents were I to feel the need to look at the documents in order to determine the question of immunity. It seems to me that such an approach would be appropriate. It is consistent with the decision of a Full Court of this Court in Zarro v. Australian Securities Commission (1992) 36 FCR 40 at pp.49 (Lockhart J) and 55 (Ryan J) and 66 (Gummow J). Even
so, it is clear from that case that the matter is one of discretion to be exercised appropriately in the circumstances of each particular case.

The Commission identified "... the interest of the public in ensuring that the ASC as a regulator is fully informed" as the public interest upon which it based its claim for immunity. Mr Colvin referred to the Commission's various roles as investigator, prosecutor and intervenor in both civil and criminal proceedings and its general responsibility for enforcement of the Corporations Law. Section 422 of the Corporations Law requires Receivers to report any relevant matter to the Commission (as did its predecessor, s.324C of the Companies Code). Section 127 of the ASC Act, so it was put, obliges the Commission to keep that information confidential. The Commission submitted that in this matter public interest requires secrecy for two principal reasons. First, where a statute compels disclosure of information against the interests of the party making the disclosure, that information should be kept secret, especially when disclosure is sought by the very party from whom the information is sought to be kept. Secondly, so it was put, there is a real risk that the quality and timeliness of compliance with the receiver's reporting obligations will be compromised if the contents of such reports are likely to be disclosed.

The applicants submitted that this amounted to a class claim for public interest immunity. Mr Colvin denied that the Commission was making a class claim for public interest immunity in respect of the Documents. He said that the Commission relied upon Mr Ogilvie's affidavit evidence that the reports contain information which relates to civil proceedings which are still on foot and which Mr Quigley seeks to bring
against the applicants who now seek to have access to the Documents. The applicants resisted what they said was a class claim on two bases. The first was that there was insufficient admissible evidence to lay the factual groundwork for such a class claim. Objection was taken to paragraphs 40, 41 and 44 of Mr Ogilvie's affidavit which I have set out above. Those objections included a reference to the fact that Mr Ogilvie had only 3½ years experience in corporate investigation, and the hearsay nature of his statements. It is not necessary for me to consider the evidentiary objection. In my view, Receivers' reports and documents of the type described above which Mr Quigley sent to the Commission do not fall within the category of documents circulating at high levels of government involving matters of national importance to the extent that the class doctrine applies. Both parties cited Sayer v. National Mutual Life Association of Australasia Ltd (1994) 34 NSWLR 132. That case tends to confirm that production of a document under compulsion of law does not, without more, (except in a very limited class of case relating to compulsory disclosure of private affairs for one purpose and its use for another) give rise to a claim for public interest immunity. In Zarro at p.46 Lockhart J. observed:

"Documents within the possession of the ASC (an investigative and law enforcement agency) of a confidential nature, which record information received by it concerning possible offences or irregularities and recording the possible course of investigations or information with respect to evidence concerning proceedings to which the ASC is a party, plainly may fall within the scope of public interest immunity; but as at present advised I cannot conceive of a case where they would fall within the class doctrine and thus be immune from disclosure irrespective of the contents of any particular document."

In National Australia Bank v. Saunders (1988) 12 NSWLR 623 Rogers J. very much doubted whether there was what his Honour described as "permanent immunity from
production" in respect of a liquidator's report under s.306 of the Companies Act 1961 (NSW). The principles applicable in that situation seem to me to be similar to those applicable in this matter. See also Conway v. Rimmer (1968) AC 910.

Mr Siopis submitted that his clients, when presenting their case at the hearing of the application, would have to rely largely on documentation and full discovery because they were not party to the discussions between the Commission and Mr Quigley. Access to the Documents was important, so it was submitted, not only for the purposes of investigating and assessing the strengths and weaknesses of the applicants' case but also to prove, by way of inference, matters such as agreements, understandings and the purposes of those involved. Mr Siopis took me to the contents of some of the documents already discovered by the Commission which he submitted supported the applicants' contention that they should have access to the Documents. The first was the Commission's determination dated 25 November 1991 to commence the investigation. Mr Siopis pointed out that by that time the Commission would have received three of Mr Quigley's reports in respect of which public interest immunity was now being claimed. They were the reports of 16 January 1991, 9 April 1991 and 29 May 1991. Then there was Mr Quigley's diary memo of 5 December 1991 of a telephone conversation with a Mr L Shervington at that time on secondment to the Commission. In my view, on a prima facie basis, the contents of that diary note are consistent with the arrangement pleaded in the statement of claim. Next I was taken to some handwritten notes of meetings between Mr Quigley and Mr Shervington on 10 December 1991 and 20 December 1991. In the first of those documents there is a note indicating that Mr Quigley was to write a letter "re prospects 107 breach and audit
reports s.285". There followed a note which indicated that the Commission would first make a section 13 determination. Again on a prima facie basis, there does appear to be a chronological correlation between the date of the first meeting and the letter dated 11 December 1991 from Mr Quigley to the Commission concerning breaches of ss.107 and 285 of the Code. The notes of the second meeting refer to what is described as "a section 13" [which I take to be a reference to a decision to make an investigation under s.13 of the ASC Act]. Then I was referred to a copy of an undated second s.13 determination which, according to the Commission's further and better particulars, (so I was told from the bar table) was made between 18 December 1991 and 9 June 1992. This was the document pursuant to which the investigation was conducted. The opening paragraphs of that document start with a reference to the appointment of Mr Quigley as Receiver and Manager of Geneva and also make specific reference to his reports of 16 January 1991 and 29 May 1991. The determination also refers specifically to a letter dated 18 December 1991 from Mr Quigley.

Mr Siopis submitted that this suggested that the six documents were at the core of the case and related to the question of the strategy referred to above.

Mr Colvin submitted that it was self-evident that reports from Receivers would be affected if their contents were disclosed at a later date. I was referred to some observations by Rogers J. in National Australia Bank Ltd v. Saunders and to the course which his Honour took in that case. Mr Colvin further submitted that the fact that the information was provided under statutory compulsion was another substantial factor to
be weighed against its disclosure. Mr Colvin submitted that the present matter fell within the exception described in Conway v. Rimmer i.e. where a State insists on a man disclosing his private affairs for a particular purpose it requires a very strong case to justify that disclosure being used for other purposes. Mr Colvin conceded that such circumstances did not constitute an absolute bar to production.

Mr Colvin pointed to the fact that the applicants do not challenge the Commission's exercise of its power to investigate by suggesting that there was nothing to investigate. The challenge was that the power was exercised for an improper purpose. He submitted that it had not been shown how, in any respect, the contents of the reports would support the inferences sought to be made from the timing and sequence of the matters to which I have referred or would otherwise support the applicants' case. The information related to the on-going Supreme Court proceedings and was, so it was put, by no means stale. This was in contrast to the situation in National Bank of Australia Ltd v. Saunders.

In reply (and in his written outline of submissions) Mr Siopis submitted that this matter was unique in that both the Commission and the Receiver are alleged by the applicants to have engaged in unlawful conduct.

As I have mentioned, Mr Colvin disclaimed any claim by his client for privilege of the Documents as a class of documents. In any event, I have held that no such claim could have succeeded.

In view of the contents of the exhibits to Mr M.T. McKenna's affidavit sworn on 6 February 1996 (being copies of the first respondent's discovered documents to which I have referred above) and particularly in view of the chronology of events in late 1991, some of which are recorded in those documents, I considered that there was a reasonably good likelihood that the Documents might be of assistance to the applicants in pursuing their case. At the same time I considered that there was substance in the contentions put forward on behalf of the first respondent. In those circumstances, I could not see how I could balance the relative strengths of the competing interests on each side of the scale without carrying out an inspection of those documents. Accordingly for those reasons I decided to inspect the Documents.

The Balancing Exercise

During the course of and after inspecting the Documents I had regard to the following factors which the applicants put forward as being on its side of the scale:

. The likelihood of injustice if the Documents are not produced. This of necessity included the second factor which the applicants put forward, namely, the evidentiary value and importance of the Documents in relation to the litigation. It is difficult to make this assessment without being privy to all the other evidence which the applicants may have mustered to date. Even so, I considered that the Documents were at least of potential evidentiary value and importance to the extent that the applicants' legal representatives would probably want to make use of them in preparation for and presentation of their clients' case. It is not appropriate to embark on a detailed description of the contents of the Documents. However, the contents are such that I consider there is a distinct possibility they will shed light upon, and assist in the characterisation of, what took place between the respondents. In those circumstances there is a significant degree of likelihood that if the applicants are denied even limited access to the
Documents, the administration of justice would be impaired.

. The nature of the litigation and in particular the fact that it concerns allegations that the statutory authority claiming public interest immunity has acted beyond power. This was considered to be a relevant factor in Sankey v. Whitlam (1978) 142 CLR 1 at pp.56-57 (Stephen J.) and Burmah Oil Co v. Bank of England [1980] AC 1090 at pp.1127-1128 (Lord Edmund-Davies). The present matter is a relatively unusual case in that the Documents were furnished by and to the very respondents (respectively) whose conduct is the subject matter complained of in the within originating application. In my opinion, in the present matter, that is a factor which weighs fairly heavily in the balance, but is secondary to the likelihood of injustice if the Documents are not produced.

. The extent to which the interests allegedly threatened have become attenuated by the passage of time or the occurrence of intervening events since the matters contained in the Documents themselves came into existence. Despite the evidentiary dispute referred to above (arising out of the applicants' objection to certain paragraphs of Mr Ogilvie's affidavit), I consider that I am entitled to adopt the approach taken by Rogers J. in National Australia Bank v. Saunders at p.626 of the report of that case. In the context of a liquidator's report, his Honour acknowledged the highly responsible task which such an office bearer carries out and the assistance and protection of the Court which is normally extended to such an office bearer. I consider that the Supreme Court proceedings bear strongly on this issue. They are on-going proceedings and any unfairness to the plaintiff in those proceedings should be avoided, if at all possible. I have borne in mind the fact that the Supreme Court proceedings are brought against the very parties who now seek to have access to the Documents. On the other hand, it seems to be common ground that criminal charges have been dropped and there is no suggestion of any further investigation with a view to the bringing of any other criminal charges.

On the first respondent's side of the scale, I consider that even without resolving the evidentiary objection I am entitled to have regard (as I have done) to what might be
the effect upon Receivers generally when complying with their statutory obligations to report to the Commission, if those reports generally became available to the persons who were the subject of them. If that were the case, I am prepared to accept that there would be a tendency towards circumspection and perhaps a reluctance to be forthcoming on matters that perhaps the Commission might wish to pursue in the public interest. On the other hand, this case is, as I have mentioned above, very much out of the ordinary. The fact that in proceedings brought against both the reporting Receiver and the Commission, the Receiver's reports might be produced for inspection would not, in my opinion, have such a serious impact of the type to which I have referred above. This would particularly be the case if there were stringent confidentiality conditions.

Two of the first respondent's submissions referred to what might be the case if there were no statutory obligation upon Receivers to provide information to the Commission. I have considered those submissions, but in my view this motion must be decided on the basis that Receivers are under a statutory obligation to furnish these reports. I think it is unlikely that Receivers will shirk their responsibilities to make full reports to the Commission because, occasionally, the interests of justice will require production of those reports to the persons mentioned in them - see the observations of Lord Morris in Conway v Rimmer at p.957 (D). In my opinion the production of the Documents will not damage the Commission's capacity to acquire information relevant to suspected criminal offences either in the present matter or any others or efficiently to investigate such matters.

Although there is reference in paragraph 44 of Mr Ogilvie's affidavit to inhibiting the willingness of members of the community to give information to the Commission in confidence, that matter was not pressed in submissions. Had it been so pressed, I would not have come to any different conclusion about how this motion should be determined. Mr Ogilvie refers to the Documents as containing information concerning the private and confidential affairs of Mr Quigley in his capacity as Receiver and Manager of Geneva and that Mr Quigley objected to the disclosure of the contents of the Documents. In my opinion the following circumstances:

. that Mr Quigley obtained this information in his capacity as Receiver and Manager of Geneva;

. that he was obliged to report the information to the Commission;

. that he is a respondent to these proceedings; and

. the nature of these proceedings

outweigh his objection which the Commission is maintaining on his behalf.

Next there is the submission that disclosure of the Documents may prejudice Mr Quigley's prosecution of the Supreme Court claim. Mr Siopis expressly disclaimed any interest in the Documents so far as the proceedings in the Supreme Court were concerned. If necessary, confidentiality orders can be extended to cover that matter.

The Commission considered that the applicants had failed to demonstrate that the Documents were in any sense "critical" to this litigation. I think the short answer to that submission is that they do not have to fall into the "critical" category. The matter
is one of degree but I consider that it is sufficient if (as I have found) there is a significant degree of likelihood that the administration of justice would be impaired; not that the Documents are critical to the litigation.

I have also considered the factor that not only were the documents produced under statutory compulsion but they also contain information about a prospective claim against the applicants. That factor is entitled to some weight but, for reasons similar to those mentioned immediately above, I do not consider it is a particularly weighty factor in this matter.

The next factor which I was asked to consider arose from the passage in Conway v. Rimmer at the foot of p.946:

"If the state insists on a man disclosing his private affairs for a particular purpose it requires a very strong case to justify that disclosure being used for other purposes".

That was in the context of Lord Reid referring to the decision of In Re Joseph Hargreaves Ltd [1900] 1 Ch.347. That case involved the Inland Revenue objecting to the production of balance sheets delivered to it by a company for the purpose of assessment of income tax. The context was a misfeasance summons brought by the liquidator of the company against its former directors. Given the passage of time since that decision and the fact that Powell JA in Sayer v. National Mutual Life Association was unable to find any other case in which public interest immunity was maintained by reason only of the fact that the information was provided under compulsion of law, I do not think that this submission takes the matter any further. It is just another factor
which has to be taken into account, and I do so.

I was also referred to the Commission's obligation under s.127 of the ASC Act to take all reasonable measures to keep information confidential. This is perhaps an inadequate summary of the section; it contains several provisions concerning authorised disclosure. I have taken the provisions of s.127 (and 127A) into account but I find the scales are still in this particular case tilted in favour of the applicants. The Commission did not contend that these sections precluded the making by this Court of the orders sought by the applicants.

In my view there is a public interest in the secrecy of these reports being maintained, but in this, somewhat unusual matter, I consider that the public interest in the proper administration of justice outweighs the public interest which the Commission puts forward for its claim that the Documents should remain secret.

Mr Colvin says that the applicants have not demonstrated how the content of the reports will support the inferences which the trial judge will be asked to draw or will otherwise support the applicants' case. I think the answer to that is that the applicants have not seen the Documents. I refer to my earlier assessment of their potential importance.

I still have some residual concerns about the extent to which the Documents should be disclosed. I think that stringent confidentiality conditions should be imposed upon production of the Documents. Initially the right of inspection should be confined to
counsel and solicitors for the applicants only. There should be a condition that the Documents not be photocopied other than in the presence of one of the applicants' solicitors and that each photocopy document should be stamped to indicate that the Documents are confidential to counsel and the solicitors for the applicants in these proceedings only and that this Court has made a confidentiality order.

I certify that this and the preceding twenty-two

(22) pages are a true copy of the Reasons for

Judgment of Justice Carr.

Associate:

Date: 9 May 1996

Counsel for the Applicants: Mr A.N. Siopis

Solicitors for the Applicant: Parker & Parker

Counsel for the First Respondent: Mr C.G. Colvin

Solicitors for the First Respondent: Regional General

Council for Western

Australia, Australian

Securities Commission

Date of Hearing: 4 April 1996

Date of Judgment: 9 May 1996

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