FEDERAL COURT OF AUSTRALIA

SUMMARY OF JUDGMENT

[1999] FCA 976

JOHN DORMAN ELLIOTT

v

SERGEANT DOUGLAS SEYMOUR

and

THOMAS SHERMAN

and

NATIONAL CRIME AUTHORITY

and

DIRECTOR OF PUBLIC PROSECUTIONS FOR THE STATE OF VICTORIA

and

AUSTRALIAN BROADCASTING CORPORATION

and

STEVEN MARSHALL CRABB

VG 411 of 1993

In accordance with the practice of the Federal Court in certain cases of public interest, the Court has prepared a brief summary to accompany the reasons for judgment that are to be delivered today. It must, of course, be emphasised that the only authoritative pronouncement of the Court’s reasons is that contained in the published reasons for judgment. This summary is intended to assist in understanding the principal conclusions reached by the Court, but it is necessarily incomplete.

                                                                                                   Ryan J

                                                                                                   19 July 1999

SUMMARY OF REASONS FOR JUDGMENT PUBLISHED 19 JULY 1999

This action was commenced in September 1993 when the applicant, Mr Elliott, sought an injunction to restrain the National Crime Authority (“the NCA”) and the individual respondents, Sherman and Seymour, from charging the applicant with any criminal offence.  The injunction was refused and the applicant was subsequently charged with theft, knowingly giving false evidence to the NCA and conspiracy to defraud in relation to payments of $39M and $27M by Elders IXL Ltd to Equiticorp Tasman Ltd (“the Forex Transactions”).  Mr Elliott, together with Mr Peter Scanlon and Mr Kenneth Biggins was committed for trial on those charges in the Supreme Court of Victoria but ultimately all three were acquitted on the direction of Vincent J after some months had been devoted to considering the admissibility of evidence which the Director of Public Prosecutions for the State of Victoria (“the DPP”) proposed to lead in support of the prosecution.  In the meantime, Mr Elliott had added the DPP, the Australian Broadcasting Corporation (“the ABC”) and Mr Steven Crabb, a former Minister in the Victorian Government as respondents to his civil action in this Court.  Broadly parallel proceedings had been instituted in this Court by Mr Kenneth Jarrett (VG 410 of 1993) and Messrs Camm, Scanlon and Biggins (VG 434 of 1993) but those applicants made no claim against the ABC or Crabb.  The respondents made various criticisms of the statements of claim in each action and, on 12 May 1995, I made orders in the action by Elliott striking out certain paragraphs of his then further amended statement of claim and giving him leave to make further allegations in lieu of the paragraphs which had been struck out.

Because Elliott and those accused with him were concentrating their energies on defending the criminal proceedings, few steps were taken in the actions in this Court until late in 1997.  Elliott was then prompted to seek leave to file a further amended statement of claim.  That leave was opposed by the remaining respondents, Elliott’s action having been discontinued against the ABC and Scanlon’s action being continued only against the DPP.  The claims for relief by the other applicants, Jarrett, Camm and Biggins have been discontinued in their entirety.

In an endeavour to meet some of the respondents’ criticisms, Elliott’s legal advisers prepared and sought leave to file a further amended statement of claim and it is that document of some 56 pages extending over 155 paragraphs which has been examined in the reasons for judgment published today and is referred to as “the statement of claim”.

It was first argued on behalf of the NCA, Sherman and Seymour that leave to amend the statement of claim should be refused and Elliott’s whole action be summarily dismissed as an abuse of process.  That argument was based first on the proposition that to continue the civil action would necessarily call into question the correctness of Elliott’s acquittal on the criminal charges.  The Victorian Court of Appeal had subsequently concluded that the trial judge’s direction to acquit had been erroneous but, of course, the verdicts of not guilty stood unaffected by that conclusion.  After a detailed examination of several rulings given by Vincent J in the criminal trial, I have concluded that when the factors for and against proceeding to a trial on the merits of the present action are weighed in the exercise of this Court’s discretion, the balance is in favour of allowing the matter to proceed. 

Counsel for the NCA next asserted that five different and contradictory accounts had been publicly given as to whether the Forex Transactions had been a sham or had been genuine as Elliott testified in the hearing before the NCA.  Accordingly, it was submitted, Elliott should be required, as a condition of being allowed to continue his action in this Court, to commit himself on affidavit to a single account of his knowledge of, and participation in, those transactions.  That invitation is declined on the ground that the account to be given by Elliott of what he knew of the Forex Transactions will be only one part of a complex mosaic of facts to be established on the way to making out one or more of the causes of action pleaded in the statement of claim.  As well, it is indicated in the reasons for judgment that written witness statements which it is likely the Court will order each party to file will ensure that Elliott’s account of the Forex Transactions is committed to writing and supplied to the respondents well before trial. 

Another reason advanced by the NCA, with the support of the other respondents, for summarily dismissing the present proceedings was that they are “foredoomed to failure”.  That submission depended, in part, on other attacks made on the validity or viability of the proceedings.  It was also based on a particular interpretation of certain sections of the NCA Act which was said to entail that any private right to seek damages for a breach of the Act is excluded and the aggrieved citizen is confined to what were called “defined public law rights”.  However, the correct interpretation of the NCA Act is not self-obviously that for which the NCA contends and is not a pure question of law but requires to be resolved against the background of particular findings of fact.  The Court has also declined to rule, at this stage, that the proceedings are not bona fide but have been brought for a purpose other than obtaining damages or other legal relief.  It is observed that the Court has ample powers to prevent the proceedings from being used for the extraneous purpose of disparaging other individuals. 

It was next argued that the statement of claim failed to disclose various causes of action on which the applicant is seeking to rely.  Counsel for Elliott disclaimed any attempt to rely on some of those causes of action, including an action on the case, malicious prosecution and breach of statutory duty.  As to the civil conspiracies to which the NCA was alleged to have been a party, it has been held necessary to plead, with appropriate particulars, the making of each agreement, the unlawful means which the conspirators had agreed to employ and that there had been actual or threatened use of those means with the infliction of pecuniary damage on Elliott.

The tort of misfeasance in a public office has been alleged against Mr Leckie, a member, and Mr Livermore, an officer, of the NCA.  That tort has been held to involve proof of actual damage and an intention by the public officer, as his or her actuating motive, to inflict that damage or the performance of an act which the public officer knows is beyond power and which involves a foreseeable risk of harm.  The Court has identified various defects in the attempt in the statement of claim to allege misfeasance in a public office and has indicated the nature of the amendments which will be required if those defects are to be overcome.  However, it has also concluded that the warning at the foot of Summons MS46 requiring Elliott to attend a NCA hearing provided an insufficient basis for alleging that the NCA had been guilty of intimidation.

The Court next examined the allegations of negligence against the NCA and the need to establish the requisite relationship of proximity.  It is acknowledged that a statutory provision such as s 11 of the NCA Act may be one of a number of factors tending to support a finding that such a relationship exists.  However, all the circumstances, including those said to make it foreseeable that Elliott would suffer economic loss in consequence of the NCA’s allegedly negligent acts or omissions, have to be pleaded or particularised.

Separate consideration is given to the allegations against the DPP.  Elliott is to be permitted to persist in his allegation of conspiracy against that respondent provided that the reformulated pleading complies with the requirements which it was earlier indicated that those parts of the revised statement of claim charging Seymour, Sherman and the NCA have to meet.  Doubts are expressed about the applicant’s ability to allege, on the available facts, matters which disclose a cause of action of abuse of process against any of Seymour, Sherman, the NCA or the DPP.  However, the Court is not prepared to preclude the applicant once and for all from an attempt properly to allege that tort against one or more of those respondents.  A similar view is taken of the allegations of “breach of duty” against the DPP which are regarded as tantamount to a plea of negligence.  Although the Court has adverted to authorities which seem to deny the availability of an action in negligence against a State or Crown prosecuting authority, it is not prepared to foreclose that issue now but prefers to allows the applicant to attempt to reformulate this part of his pleading by raising facts which may make those authorities distinguishable.

The allegations against Crabb have been regarded as confined to misfeasance in public office and conspiracy.  The former allegation can stand provided it is accompanied by an assertion, with appropriate particulars, that Elliott suffered actual economic loss as a result of Crabb’s alleged misfeasance.  Four separate cases in conspiracy are now sought to be made against Crabb.  The first, an “unlawful acts” conspiracy, is said to have involved three other Labor politicians and the ABC.  The unlawful acts relied on are allegedly improper issue of notices under s 13 of the NCA Act, the leaking by Crabb of information acquired in his capacity as a member of the Inter-Governmental Committee established under that Act and the publication of that information by the ABC.  The second conspiracy alleged to have involved the same parties is apparently one for the predominant purpose of injuring Elliott by lawful means, the making of “derogatory public statements” about him.  The third allegation of conspiracy against Crabb is that he and the ABC “agreed to use unlawful acts with the intention of harming the Applicant in his reputation, business and public office”.  The unlawful act seems to be Crabb’s alleged misfeasance in public office to which reference has already been made.  The fourth allegation of conspiracy which seems to be an alternative to the third, is that he and the ABC agreed to reveal as part of the “7.30 Report” on 20 February 1990 that Elliott was under investigation by the NCA.

Various difficulties have been identified as arising from the present four allegations of conspiracy against Crabb.  In particular, it has been suggested that the particulars set out in Schedule A to the statement of claim do not support an inference that the requisite agreements were made as alleged.  Those difficulties will have to be overcome by expanding the allegations and providing adequate particulars, including particulars of economic loss, if the applicant is to be permitted to persist in his allegations of conspiracy against Crabb.

In the result, the Court has given the applicant until 3 September 1999 to recast the statement of claim confining the allegations to the causes of action indicated by today’s reasons to be arguably available and generally conforming with those reasons.  The various motions before the Court have been adjourned to 27 September 1999 when the respondents will be given an opportunity to indicate any remaining or new deficiencies in the reformulated statement of claim.  On that date, the Court will also hear argument as to the orders for costs which should be made on Elliott’s application for leave to amend and the other, related, motions which are before the Court.  Similar orders have been made in Scanlon’s application against the DPP as sole remaining respondent.

The full text of the judgment and this summary are available at www.fedcourt.gov.au