FEDERAL COURT OF AUSTRALIA

WARRANTS – authorised seizure of documents – questions of practice and procedure – limited disclosure of documents under claim of public interest immunity – not to be disclosed to counsel until immunity claim rejected.

Administrative Decisions (Judicial Review) Act 1977 (Cth)

Judiciary Act 1903 (Cth) s 39B

Crimes Act 1914 (Cth) s 29D, s 86

Sales Tax Assessment Act 1992 (Cth) s 110

Commonwealth v Northern Land Council (1993) 176 CLR 604, applied

Commonwealth v Northern Land Council (1991) 30 FCR 1, cited

Jackson v Wells (1985) 5 FCR 296, applied

DOUGLAS SEYMOUR v JOHN JAMES PRICE

NG 631 OF 1998

JULIAN FITZGERALD AND KEITH JOHN RANDALL v JOHN PRICE

NG 651 OF 1998

DOUGLAS SEYMOUR v JOHN JAMES PRICE

NG 678 of 1998

FRENCH, O’CONNOR and NORTH JJ

SYDNEY

8 SEPTEMBER 1998

THE COURT ORDERS THAT:

1.                  Leave to appeal is granted.

2.                  The appeal is allowed.

3.                  The orders made by Einfeld J are set aside and the matter is remitted back to His Honour to determine the claims for public interest immunity upon his own inspection of the relevant documents.

4.         The Respondent to pay the Appellant’s costs of the appeal.

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

THE COURT ORDERS THAT:

1.      Leave to appeal is granted.

2.      The appeal is allowed.

3.      The orders made by Einfeld J are set aside and the matter is remitted back to His Honour to determine the claims for public interest immunity upon his own inspection of the relevant documents.

4.      The Respondent to pay the Appellants’ costs of the appeal.

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

THE COURT ORDERS THAT:

1.      Leave to appeal is granted.

2.      The appeal is allowed.

3.      The orders made by Einfeld J are set aside and the matter is remitted back to His Honour to determine the claims for public interest immunity upon his own inspection of the relevant documents.

4.      The Respondent to pay the Appellant’s costs of the appeal.

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

BETWEEN:          JULIAN FITZGERALD                                                 ng 651 of 1998

                               FIRST APPLICANT/APPELLANT

                               KEITH JOHN RANDALL

                               SECOND APPLICANT/APPELLANT

AND:                     JOHN JAMES PRICE

                               RESPONDENT

BETWEEN:          DOUGLAS SEYMOUR                                                 Ng 678 of 1998

                               APPLICANT/APPELLANT

AND:                     JOHN JAMES PRICE

                               RESPONDENT

REASONS FOR JUDGMENT

These three applications for leave to appeal arise out of proceedings before a Judge of this Court in which orders are sought for the review of decisions to issue search warrants.  The proceedings were commenced by three applications each brought under the Administrative Decisions (Judicial Review) Act 1977 (Cth) and under s 39B of the Judiciary Act 1903 (Cth). 

Wendy Elder, a Justice of the Peace in Sydney, issued one of the warrants in June 1998.  It authorised the search and seizure of evidential material from an apartment dwelling described as premises of John James Price.  The warrant identified classes of material relating to a large number of companies, firms and persons involved in computer technology. 

The authorised seizure was restricted to things as to which there were reasonable grounds for suspecting that they would afford evidence as to the commission of certain offences against the laws of the Commonwealth.  The offences were all said to involve fraud against the Commonwealth contrary to s 29D of the Crimes Act 1914 (Cth), either by the lodgment of false applications for the refund of sales tax or by failure to remit taxation owing on sales which was payable. 

A second warrant was issued in Melbourne on 22 June 1998 by Julian Fitzgerald, a Magistrate of the State of Victoria.  It authorised the search and seizure of evidential material at a unit in Nunawading, being the central business premises of Computer Connection International Pty Ltd and Maxcom Computers Pty Ltd.  The classes of things whose seizure was authorised and the offences in respect of which they were authorised were similar to those in the Sydney warrant.

Immediately following the issue of the first Sydney warrant, the Australian Federal Police Officer who had applied for its issue realised that it did not extend to any garage or store room which might be associated with the apartment in question.  He made a further application to Ms Elder as a result of which a fresh warrant relating to the Sydney apartment was issued on 23 June 1998.  He surrendered the first warrant unexecuted.  The applications for review challenge the validity of all three warrants. 

The grounds for the applications were in common form alleging improper exercise of power on the part of the issuing officers, Ms Elder and Mr Fitzgerald.  In each case the particulars of that ground asserted that the affidavits upon which they purported to act did not reveal the entirety of prior dealings between the applicant and the Australian Taxation Office and in failing to consider that history they had failed to take into account a relevant consideration.  Moreover by considering only the affidavit material without a full disclosure by the Australian Federal Police Officers applying for the issue of the warrants, of the history of the matter between the applicant for review and taxation officers the issuing officers took into account irrelevant considerations.  Moreover it was said that by failing to reveal that the offence actually suspected of having been committed involved a conspiracy contrary to s 86 of the Crimes Act 1914 (Cth) the Australian Federal Police Officer in each case placed before the issuing officers a large amount of prejudicial and irrelevant material pertaining to the alleged criminal activities of other parties to whom warrants were prospectively to be directed, which when considered by the issuing officers involved them taking into account irrelevant considerations in their decisions to issue the warrants.

In addition, it was said that the issuing officers failed properly to carry out their statutory duty to consider all material placed before them in coming to the decision whether to issue the warrant.  The third ground was that the making of the decision to issue the warrant was invalid on the grounds of ulterior or collateral purpose in that each warrant purported to have been issued with respect to possible offences against s 29D of the Crimes Act rather than a conspiracy contrary to s 86 of the Crimes Act.

A further ground was added before Einfeld J in relation to the application for review of the issue of the second Sydney warrant.  That raised a constitutional question that the purported conferral of jurisdiction upon the Justice of the Peace to issue a warrant under the Crimes Act was beyond the power of the Parliament of the Commonwealth. 

Notices to produce documents were issued in the proceedings NG 631 of 1998 relating to the search warrant in respect of the Sydney premises and in NG 651 of 1998 in connection with the search warrant relating to the Melbourne premises.  The notice in relation to the Sydney warrants required production of the following two documents:

1.                  A forty seven page sworn application for search warrants in respect of various premises in Sydney, together with annexures.

2.                  An eight page sworn application for a search warrant in respect of one location in Sydney.

The notice to produce in connection with the Melbourne search warrant required production of two further documents:

1.                  A fifty page sworn application for search warrants in respect of various premises in Melbourne.

2.                  Two pages of handwritten notes made by Mr Fitzgerald who was the magistrate to whom the Melbourne application was submitted under s 3E of the Crimes Act 1914.

The Australian Federal Police officers who applied for the issue of the warrants claimed public interest immunity in respect of the application for the Sydney and Melbourne warrants.  In addition,  Mr Fitzgerald the magistrate who issued the Melbourne warrant claimed public interest immunity in respect of his own notes.  For the purpose of the proceedings it was assumed that a notice to produce had also issued in relation to the other Sydney warrant proceedings, NG 678 of 1998. 

The applications for the issue of the Sydney and Melbourne warrants were in substantially the same terms.  In respect of the supplementary Sydney application public interest immunity was claimed for one paragraph.  The Melbourne magistrate’s notes constituted two pages.  The claims for public interest immunity were brought before his Honour by way of a motion for an order setting aside the notice to produce in respect of the Sydney warrants and a motion for an order that the relevant documents not be produced in relation to the Melbourne warrant.

The claims for public interest immunity were supported by affidavits of senior AFP officers. 

The grounds upon which public interest immunity was claimed in respect of the sworn applications for the issue of the warrants were expressed in terms of generality and indeed common form generality.  They alleged that the disclosure of certain parts of the affidavits were subject to statutory restrictions imposed by s 110 of the Sales Tax Assessment Act 1992 (Cth), that disclosure would interfere with ongoing investigations, that the disclosure of the documents would create a risk that the identity of police informers could be inferred and that the disclosure would unnecessarily reveal police methodology. 

In argument before his Honour on 13 August 1998, sanitised versions of the applications were made available with the vast bulk of their content blacked out.  His Honour was subsequently provided with full text copies of the applications. 

It is fair to say that in the course of argument his Honour expressed some scepticism about particular aspects of the claim for public interest immunity and there were on the face of it grounds for that scepticism.  In the course of argument his Honour raised the possibility of counsel for the applicants seeking orders of review being allowed to look at the documents on appropriate undertakings.  This was opposed by counsel instructed by the Director of Public Prosecutions on the ground that his office and the Australian Federal Police were at the outset of an investigation into what was alleged to be “enormous fraud against the Commonwealth”.  It was said to be completely inappropriate that anybody with any connection with the person under investigation be entitled to see the documents in question if the public interest immunity claim were sound.  There was debate about that question.  His Honour in the course of that debate made reference to his own experience at the Bar of having seen, on appropriate undertakings, documents which were the subject of “the highest public confidentiality”.  His Honour recalled one case in which he was not permitted even to have either his junior or his instructing solicitor look at the relevant documents, that he had done it alone.  He said:

“Now, there are circumstances in which such orders can be fashioned and I am wondering why this case is any particularly different.  I am not saying I am going to make the order, I am just – I want when I read the document to be taking into consideration the other, all the possibilities.”

He saw the purpose of such a step as being not to satisfy the curiosity of counsel but to enable him to come to a correct decision.  After considerable further argument his Honour then raised the question whether he should be given the assistance of counsel on the question whether there was a valid claim of public interest immunity.  He expressed “grave reservations” about there being a danger that if he made the documents available to counsel for the purpose of obtaining their submissions that in some way there could be a serious breach of the public interest which might have more at stake than the integrity of a police investigation.  That, he said, was an important matter but so were the rights of parties to make submissions to a court about their rights. 

The ethical conflicts falling upon counsel placed in possession of documents which he could not disclose to his own client were canvassed in the course of argument.  His Honour observed that how counsel balanced any such dilemmas was a matter for him and his professional association and his ethical rules.

In the event his Honour decided that he would make available to senior and junior counsel for the applicants for review, the sworn applications for the search warrants.  He required as a condition of making the applications available that counsel sign a written undertaking which would embrace the following matters:

1.                  That they would not remove the statements from the court.

2.                  That they would not reveal their contents or any part thereof to any person either directly or indirectly except the court.

3.                  They would not make any copies of the documents or any part or parts thereof except as was necessary to make notes from the document for presentation of their argument to the court on the substantive application.

4.                  Any such notes should be in handwriting only and would be destroyed after use in argument.

5.                  A copy of such undertaking should be given to counsel for the respondents.  Upon presentation to the court of those written undertakings he would make available the two applications.

He said:

“It is my proposal, but I shall hear argument, that when the arguments are then presented to the Court on the substantive application the Court shall be closed in order to permit the fullest possible argument.  And by closed I mean that the Court shall be cleared of all such persons as have not seen the documents to date.  The transcript of such a hearing will be marked confidential transcript, to be released only upon my order.”

Counsel for the Director of Public Prosecutions then indicated to his Honour that he had instructions subject to confirmation to appeal the decision.  He asked his Honour to adjourn the proceedings so that an application for leave to appeal, if necessary, could be made.  In agreeing to adjourn the matter his Honour said:

“I should perhaps make it clear that the purpose of my making this order is to assist me in a very difficult matter ascertaining whether there is or ought to attach to the material, the public interest immunity and statutory bar that are claimed.”

His Honour made similar orders in relation to the magistrate’s notes.

Subsequently applications for leave to appeal against his Honour’s rulings were made by the issuing officers and also by the Melbourne magistrate in relation to the notes.

The decision taken by his Honour was of an interlocutory character.  Although it involved an immediate qualification of the public interest immunity claim in the sense that confidentiality would be abrogated to the extent that documents were shown to counsel, it did not involve a rejection of the substance of the claim.  Nevertheless, it was a decision of importance for the conduct of the proceedings and went beyond a matter of mere procedure.  By widening, as it did, the circle of persons with access to the documents it gave rise to a finite risk, albeit it may have been small, of inadvertent disclosure beyond that circle.  That is a factor which weighs in the scales in favour of the grant of leave.  Taken by itself it might not be sufficient to warrant leave being given.

There are, however, important questions of practice and principle which arise in a case such as the present and which were not expressly drawn to his Honour’s attention in these proceedings. 

The practice of limited disclosure of documents under claim of public interest immunity to counsel was the subject of comment by the High Court in Commonwealth of Australia v Northern Land Council (1993) 176 CLR 604.  In that case public interest immunity was claimed for some 126 cabinet notebooks.  There were many thousands of pages containing notes of discussions in Cabinet and committees of Cabinet.  Justice Jenkinson, at first instance, made an order requiring that the documents be produced for inspection on behalf of the applicant, such inspection to be limited to the applicant’s legal advisors.  The Full Court in referring to the discretion under which the Judge might himself examine documents said that from that discretion:

“…it is but a short step when, as in this case, the number of documents is large, comprising many thousands of pages, and the evidentiary issues are complex, for a judge to assess that the most appropriate course is to allow confidential inspection by the legal advisors to the parties who may, then properly informed, assist the Court upon the question whether a general disclosure is necessary.” – Commonwealth v Northern Land Council (1991) 30 FCR 1 at 38-39.

The High Court reversed the decision of the Full Court and in particular upheld the claim for public interest immunity in relation to the cabinet notebooks.  At the conclusion of the joint judgment of Mason CJ, Brennan, Deane, Dawson, Gaudron and McHugh JJ it was said:

“It cannot, in our view, be said that exceptional circumstances exist which would justify the denial of the claim of public interest immunity, as a class claim, for the documents in question.

There was, therefore, no call for Jenkinson J to order that the documents be produced for inspection.  But we would add that, even if there had been, the procedure of ordering production of documents for inspection by the legal representatives of one of the parties, even upon a restricted basis, before the claim for immunity had been decided by the court, was open to serious question.  Whatever the safeguards, it represents an encroachment upon the confidentiality claimed for the documents.  And in this case, public interest in their immunity from disclosure was of the highest order.  If inspection of documents is necessary to determine the question of immunity (and in this case it was not) then it ought to be carried out by the court before ordering production for inspection by a party. [As in Alister v The Queen (1984) 154 CLR at p 469]  No doubt this may in some cases cast a heavy burden on the court, but it is unavoidable if confidentiality is to be maintained until a claim for immunity is determined.”

Toohey J dissented on the question of the existence of the public interest immunity but observed at 638:

“Inspection by an applicant’s legal representatives, subject to an undertaking of non-disclosure, will often place them in a position of difficulty viz a viz their client.  It may even tie their hands in the further conduct of the litigation.  Although this is largely a matter between them and their client, the judge may take this aspect into account when deciding the appropriate course to be followed in the determination of a claim for public interest immunity.

The Full Court saw the approach to be taken by Jenkinson J as the exercise of a discretion, not to be interfered with by the Full Court unless their had been some error of principle on his part even if “each of us might have approached the exercise of a discretion somewhat differently.”  It would not be right to say that the matter was simply one for the exercise of discretion.  Rather, the question is whether Jenkinson J erred in the approach he took.  If he could be shown to have erred, for instance by failing to appreciate the need to preserve confidentiality of the entries in question, on the one hand, or their possible importance to the NLC case, on the other, it was for the Full Court to correct the error.  But, when regard is had to the amount of material involved and the need to conserve the time of the court as well as of the parties, it cannot be said that Jenkinson J erred in making an order designed to put himself in the position of being able to say, once the entries had been sifted through by the NLC’s legal representatives, whether the protection to which the entries were otherwise entitled should yield to the public interest in the administration of justice in the light of the justiciable issues between the parties.”

In Jackson v Wells (1985) 5 FCR 296 at 307 Wilcox J gave consideration to a submission that documents for which public interest immunity was claimed and which had grounded the issue of telecommunications interception warrants, be made available to the legal representatives of the parties.  His Honour said:

“I gave this submission anxious consideration.  It was a course apparently considered by the High court in Alister, although ultimately not adopted.  As I have indicated, I would have welcomed the assistance of counsel upon the content of the documents.  The applicants would, no doubt, have felt more satisfied that the documents were rigorously examined by the Court if their counsel had been given the opportunity to take the Court through the documents.  But, in the end, I rejected the proposal.  It involves a number of problems.  Without reflecting in any way upon the integrity of any counsel or solicitor, difficulties are likely to arise where counsel appearing in, and advising their client in respect of, protracted and complex proceedings, acquire information which they are not free to use or to pass on to their clients.  During the heat of battle an unwitting disclosure may occur.  Frank and full advice becomes impossible.  I am aware of cases in which, for reasons such as these, experienced counsel have declined to receive information which they are not free to share with their clients.  It seems to me merely common sense to conclude that the fewer people who have access to confidential information the less is the risk of unauthorised disclosure.  Weighing the assistance likely to be obtained from counsel’s submissions against the sensitivity of the material, it seemed better not to accede to [the] suggestion.”

The observations of the High Court in Commonwealth v Northern Land Council set a very high barrier indeed to the use of this procedure.  True it is that in that case public interest in the immunity from disclosure was “of the highest order” and that, no doubt, would be a factor militating against even limited disclosure in any event.  But their Honours subsequent comments were of general application and made upon the hypothesis that inspection of the documents was necessary to determine the question of immunity.  The observations of Toohey J make clear that a factor in favour of limited disclosure is the large amount of material involved and the need to conserve the time of the court.  In the present case the risk of damage to the public interest arising from disclosure to counsel would not appear to be of the same order of magnitude.  Nevertheless, the very ground of the public interest immunity claims does involve sweeping and if may be said, general and to some extent common form assertions of damage to police investigations and effectiveness and possible identification of informers. 

The scope of the documents in this case is minuscule compared with those under consideration in the Northern Land Council  case.  Beyond the broad statement that he would benefit by the assistance of counsel, his Honour did not, with respect, advert to matters which would justify him passing through the very narrow gate of discretion which the High Court would appear to have left open in the Northern Land Council case.  Moreover there was, on the face of it, no real practical imperative for making these particular documents available to counsel on a limited and confidential basis.   As we have said the question of principle just discussed was not adequately agitated and therefore not considered by his Honour.   Consequently in our opinion, his Honour’s discretion has miscarried on an important issue of practice which goes beyond the mere management of these proceedings.  That was because he was not given the opportunity to consider the principle expressed generally in the decision of the High Court in Commonwealth v Northern Land Council.  It therefore falls to us to exercise the discretion in accordance with that principle. 

In our opinion a proper application of the principle to this case would require that the documents not be disclosed to counsel unless and until the public interest immunity claim is rejected.  In our opinion therefore, leave to appeal should be granted and the appeal should be allowed.  The orders made by his Honour should be set aside and the matter remitted to his Honour to determine the claims for public interest immunity upon his own inspection of the relevant documents.  Costs will follow the event. 

We should add that in relation to the search warrant applications there was no dispute that they were sought for a legitimate forensic purpose.  That issue was raised in relation to the magistrate’s notes but having regard to the decision on the question of his Honour’s ruling, it is unnecessary to expound upon that question. 

The Court was invited to proceed to determine the questions of public interest immunity for itself.  However, having regard to the fact that his Honour is seized with the matter and has already seen the relevant documents, it is the opinion of all of us that if the appeal is allowed the matter of public interest immunity should be determined by his Honour. 

Associate:

Dated:              8 September 1998