Federal Court of Australia

Commonwealth Director of Public Prosecutions v The Country Care Group Pty Ltd (Ruling No 5) [2020] FCA 1825

REASONS FOR RULING

BROMWICH J:

1    These are the reasons for a ruling that was given orally and subsequently also provided in writing on 27 November 2020. This followed the hearing of an objection by the third accused, Mr Cameron Harrison, to the admission into evidence of an audio recording and transcript of a private conversation between the second accused, Mr Robert Hogan, and a key prosecution witness, Mr Andrew Cuddihy. There are separate objections to certain parts of the recording and transcript by the first accused, The Country Care Group Pty Ltd, and by Mr Hogan, some of which are likely to be addressed by prior evidence rulings. Those content objections, and any other like objections, were not the subject of the 27 November 2020 ruling and are not the subject of these reasons.

2    The private conversation was deliberately recorded by Mr Cuddihy at his business premises in Sydney on 6 August 2015, without Mr Hogan’s knowledge. The recording was made using a mobile telephone and also an office telephone system. There is no dispute that the recording entailed the use of a listening device. The evidence is sought to be excluded by reason of s 7 of the Surveillance Devices Act 2007 (NSW). The effect of s 7 as relevant to this dispute is that:

(1)    s 7(1)(b) creates a serious criminal offence of using a listening device to record a private conversation to which that person is a party, carrying a penalty of up to 5 years imprisonment and/or a substantial fine; and

(2)    s 7(3)(b)(i) provides that s 7(1)(b) does not apply to the use of a listening device by a party to a private conversation if “a principal party to the conversation consents to the listening device being so used and the recording of the conversation … is reasonably necessary for the protection of the lawful interests of that principal party”.

3    Sections 11 and 12 of the Surveillance Devices Act create equally serious criminal offences of communicating, publishing, or possessing a private conversation or record of a private conversation that has come to a person’s knowledge as a direct or indirect result of the use of a listening device in contravention of, relevantly, s 7(1).

4    The prosecutor contended that the exception in s 7(3)(b)(i) applied, while Mr Harrison contended that it did not. The critical issue was whether the recording of the conversation by Mr Cuddihy was “reasonably necessary” for the “protection of” Mr Cuddihy’s “lawful interests”. If the exception did not apply, Mr Harrison contended that the recording and transcript should be excluded as illegally obtained evidence, while the prosecutor contended that the discretion in s 138 of the Evidence Act 1995 (Cth) should be exercised in favour of admitting that evidence.

Facts

5    The following facts are derived from a statement from Mr Cuddihy and from a transcript of part of his cross-examination during the course of committal proceedings.

6    In a statement given to the Australian Competition and Consumer Commission some seven months after the conversation was recorded, on 15 March 2016 (the statement itself is undated, but the date upon which it was made is identified in a subsequent statement), Mr Cuddihy said the following (emphasis in original):

Meeting with Mr Rob Hogan on 6 August 2015

[141]    On the afternoon of 5 August 2015 I received a telephone call from Mr Rob HOGAN who had already left the meeting of NSW Peak Care Members. During that telephone conversation an appointment was made at his request for a meeting at my office the next day. On 6 August 2015 Mr Rob HOGAN came to the [Patient Handling Pty Ltd] office in Marrickville.

[142]    I AM SHOWN document number 1000741.003.001.0433 which I IDENTIFY as a calendar appointment sent by me to Mr Rob HOGAN for 10.00am to 10.30am on 6 August 2015 with the subject as “Catch-up” with location as “1 Mitchell St Marrickville”.

[143]    As I have stated earlier, there were several instances from my past business dealings with Mr Rob HOGAN where I felt we had made verbal agreements and statements to me which he has later reneged on. As I had come to distrust what he said I decided to record our meeting so I would have a clear record in case a dispute arose about what he said in the conversation. I thought that I would be able to use the tape on a one-to-one level with Mr Rob HOGAN in the event that he disagreed with my memory of what was said. If Mr Rob HOGAN dismissed the contents of recording and the commitments or agreements he had made in it, I expected to make it available to my lawyers to use as appropriate.

[144]    On the morning of 6 August 2015 Mr Rob HOGAN came to the premises of Patient Handling Pty Ltd at 1 Mitchell Street, Marrickville NSW 2204. At about 10.20am I met him and showed him to my office in upstairs back area of the building and we had a conversation.

[145]    I recorded the conversation with Mr Rob HOGAN via my mobile phone, which I placed on my desk, and also via a Polycom office communications system, which had a microphone module, which was also on my desk. I did not say to him our conversation was being recorded. I made the recording using an application I had installed on my mobile phone called Dropvox which automatically creates a file on the cloud-based application called Dropbox. I understood the recording via the Polycom system created a separate audio file on the company computer network but I have been unable to locate this file on the network since. But I do still have the recording of the conversation from the Dropvox system. This is the only conversation with Mr Rob HOGAN that I have recorded.

[146]    My meeting with Mr Rob HOGAN lasted for about forty minutes during which we had the following conversation: [That paragraph then reproduces the text of the conversation, derived from the recording, with some commentary.]

[147]-[148]    [Mr Cuddihy produces a USB stick onto which he copied the recording of the conversation made using his office telephone system and a copy of a transcript of the recording read and initialled by him.]

[149]    Before I had this conversation with Mr Rob HOGAN I was unaware that he would be discussing the pricing of products that appeared on the website of Patient Handling Pty Ltd.

7    The relevance of [149] is that it indicates that the content of the conversation that is relied upon by the prosecutor in relation to charges 1 to 3 in the indictment was not expected by Mr Cuddihy. The prosecutor characterises the conversation as being “undoubtedly important evidence that Mr Hogan was seeking to persuade Patient Handling to enter into the alleged illegal cartel arrangement or understanding with Country Care Group”. As will be apparent, I accept that characterisation.

8    Mr Cuddihy was cross-examined during the committal proceedings by senior counsel for Mr Hogan, including the following:

In your first statement you set out in some detail events surrounding a conversation that you had with Mr Hogan on 6 August 2015, do you recall those events and what you’ve said in your statement?---Yes.

That is a conversation that occurred at the offices of your business, Patient Handling, in Marrickville in Sydney?---Yes.

That is a conversation, as you have very properly set out in your statement, that you recorded?---Correct.

Was this the first time that you have recorded a conversation in this way?---Yes.

Was it your idea to record the conversation?---Yes.

Did you discuss your idea of recording the conversation with anybody else before you proceeded to do so?---No.

Why did you record the conversation on both your mobile phone and the office communication system?---Because the office communication system had proven to be unreliable.

But why not just record it on your mobile phone then?---Well my intention was to use the office communication system but as a contingency I recorded it on my mobile phone.

…

Was it your idea to record the conversation secretly in the sense that you did not tell Mr Hogan that he was being recorded?---I did not tell Mr Hogan he was being recorded, yes.

That was a conscious decision on your part, wasn’t it?---Yes.

Was it your idea to engage Mr Hogan in that conversation whilst consciously not telling him that he was being recorded?---It wasn’t my idea to have the conversation.

Why did you record the conversation?---Because I was protecting my legitimate interests.

What do you mean by legitimate interests?---I’d had some previous dealings with Mr Hogan where situations that had been promised or things that had been said had been reneged on and I was concerned that I was going to be put in a situation where something would be either said or promised or guaranteed and it would either be revoked, reneged on or not acted on.

When you said a few answers ago that it was not your idea to have the conversation, what did you mean?---Mr Hogan requested to meet with me and I was concerned that I was going to be put in a disadvantageous situation for myself and my business.

Can you recall when it was that Mr Hogan requested the conversation?---I think it was the day before.

At what point did you come to the decision that you would record that conversation whilst not telling Mr Hogan that he was being recorded?---About 20 minutes before he arrived at my office.

Did anything happen to prompt that decision?---Only the previous history that we’d had.

Have you ever made any other recordings in a similar way with anybody?---No.

9    The prosecutor’s written submissions dated 6 November 2020 conveniently summarise the effect of the evidence that led to the meeting being proposed by Mr Hogan and suggest what should be made of that and the above evidence as follows:

[8]    The circumstances in which Mr Hogan came to discuss matters with Mr Cuddihy on 6 August 2015 commenced with his receipt on 4 August 2015 of an email from Mr Cameron Harrison of Country Care Group attaching draft membership and new tender documents and notifying a meeting of members of Country Care Group the next day to discuss them. Mr Cuddihy says this was the first occasion he received any document that sought to formalise a legal relationship between Patient Handling and Country Care Group. The meeting on 5 August 2015 was attended by several members of Country Care Group including Mr Cuddihy and Mr Hogan. Mr Hogan explained the documents were for discussion and requested the members to take them away and have a think about them.

[9]    On the afternoon of 5 August 2015 Mr Cuddihy received a phone call from Mr Hogan and a meeting was arranged between them for the next day at Patient Handling’s premises at Marrickville. Mr Hogan gave no indication of what he wished to discuss when making the appointment but given the events of 4 and 5 August 2015 it is reasonable to infer Mr Cuddihy would have anticipated there would be discussion of the draft membership agreement and tender documents Mr Harrison emailed him on 4 August 2015. Based on his statement at [143] Mr Cuddihy clearly contemplated that his meeting with Mr Hogan might result in agreements being made between them (on behalf of their companies) and/or commitments being made by Mr Hogan on behalf of Country Care Group. On Mr Cuddihy’s account it was his lack of trust in Mr Hogan to abide by any oral agreements or commitments that caused him to record the conversation for the purposes he states.

10    While Mr Harrison, in his response to the third further amended notice of the prosecution case, generally takes issue with the facts, matters and circumstances alleged relating to the meeting, he did not express any specific contrary view to this summary during the hearing of the objection.

Case law considering “reasonably necessary for the protection of … lawful interests”

11    Numerous cases have considered the phrase “reasonably necessary for the protection of the lawful interests of” the principal party to a conversation who has consented to it being recorded in the Surveillance Devices Act, and a similar phrase in the predecessor Listening Devices Act 1984 (NSW). In Violi v Berrivale Orchards Ltd [2000] FCA 797; 99 FCR 580, Branson J considered the meaning of the phrase “lawful interests” as it appeared in s 5(3)(b)(i) of the Listening Devices Act, being a relevantly identical exclusion to a relevantly identical prohibition to the present provision. There are, however, two notable differences between the two statutes:

(1)    the recording offence now expressly references mens rea with the requirement that the person must “knowingly install, use or cause to be used or maintain a listening device” (emphasis added); and

(2)    s 13 of the prior Listening Devices Act contained an express and absolute prohibition on admitting evidence of such a conversation obtained as a direct consequence of a contravention unless innocently obtained, to be contrasted with the balancing exercise required by s 138 of the Evidence Act (noting that in this Court, s 13 was not picked up as surrogate federal law because it conflicted with s 138).

12    In Violi, Branson J, in agreeing with prior authority, held (at [23]) that to fall within the analogous exception under consideration, the recording of the conversation needed to be, “as a matter of objective judgment, necessary for the protection of an actual lawful interest, existing as at the time of the conversation, of that principal party”. Her Honour then stated:

[28]    Unassisted by authority, it seems to me that “lawful interests” are to be distinguished from “legal interests”. I do not consider that s 5(3)(b)(i) calls for a legal interest in the sense of a legal right, title, duty or liability. Rather I consider that “lawful interests” within the meaning of the paragraph are interests which are not unlawful. The expressions “legitimate interests” or “interests conforming to law”, in my view, convey similar meanings to the intended meaning of “lawful interests” in the paragraph.

…

[32]    It is not necessary for me to attempt to determine exhaustively the types of circumstance in which the recording of a conversation by a principal party to the conversation “is reasonably necessary for the protection of the lawful interests of that principal party” within the meaning of s 5(3)(b)(i) of the Listening Devices Act. I am inclined, however, to think that the recording of a conversation intended by the parties involved to result in an oral contract in terms outlined during the conversation would be such a circumstance. I interpolate that that is, of course, not this case as the alleged contract is pleaded to have been made before the date of the two conversations. Similarly, I am inclined to think that the recording by one party of a threatening telephone conversation or of a conversation forming part of a blackmail attempt would fall within the paragraph. However, such circumstances are far from the circumstances of this case.

13    In R v Le [2004] NSWCCA 82; 60 NSWLR 108, the appellant had been charged with two offences under s 5(1)(b) of the Listening Devices Act, the equivalent of s 7(1)(b) of the Surveillance Devices Act, and convicted in the Local Court. Ms Le had sought to record an admission as to the murder of a member of parliament. She was a close associate of another man who had been convicted of that murder. On an appeal to the District Court, a case was stated for the consideration of three questions by the Court of Criminal Appeal. The third question concerned the defence in s 5(3)(b)(i) and whether it had been correctly applied. That involved the question of whether it was reasonably necessary to record the conversation in order to protect Ms Le’s lawful interests.

14    In his dissenting judgment in Le, Giles JA considered the lawful interests which Ms Le relied upon to enliven the defence, being that she recorded the conversation to protect her credibility generally, to support her credibility if she had to give evidence in Court, and, to protect herself against exposure to being charged with making serious false allegations. His Honour held that it was open to the District Court judge hearing the appeal from the Local Court (which is ordinarily an appeal by way of rehearing on the papers) to find that the recording was not reasonably necessary based on any of these interests. His Honour noted that the concern about having a supporting record before making allegations was more significant than the other two interests relied upon, but that it was ultimately open to be found to be insufficient.

15    Conversely, Hulme J agreed with Adams J in Le that the defence had been made out in the particular circumstances of that case, but expressed grave doubts that, as a general proposition, recording a conversation to ensure there was an irrefutable record of it could be regarded as protected. Adams J went further in finding that as there was a moral duty and possibly a legal duty to report an admission of the commission of a serious offence, which was the intended content of the conversation. His Honour concluded that, while recording the conversation was not absolutely necessary, it was reasonably necessary. Thus the case really turned on a factual assessment.

16    In Sepulveda v R [2006] NSWCCA 379; 167 A Crim R 108, an adult complainant in relation to sexual assault allegations recorded the appellant’s admissions of sexual activity with him when he was a child. The defence under the Listening Devices Act was not upheld, and the recording therefore rendered inadmissible, because the complainant could have gone to the police with his complaints rather than approach the appellant himself to record the conversation. Johnson J (with whom McClellan CJ at CL and Hislop J agreed) concluded:

(1)    as to “reasonably necessary” at [117]-[118], “it is sufficient that the recording of a conversation is reasonably appropriate (rather than essential) for the protection of the lawful interests of the principal party”, being an objective test based on the grounds that existed at the time of the recording, citing several cases including Violi at [17]-[18], [23];

(2)    as to “protection” at [120]:

According to the Macquarie Dictionary, the meaning of the noun “protection” includes “preservation from injury or harm”. The Oxford English Dictionary definition includes “shelter, defence, or preservation from harm, danger, or evil”. In Udini v Aldo t/a Fine Line Joinery Pty Ltd (1998) 16 NSWCCR 418, her Honour Judge Truss accepted this meaning of the word “protection” in the section in concluding (at [19]) that “the applicant’s lawful interests were in need of ‘defence from harm, danger and evil’ at the time when the recording was made and that the use of the device was reasonably necessary for the protection of his lawful interests”. This meaning seems apt given the statutory context in which the word appears.

(3)    as to “lawful interests” at [125], the relevant cases revealed that findings were made where the defence was both enlivened and where it was not, and that these findings depended on the circumstances of a particular case; and at [126], that it was possible that Branson J’s construction in Violi was too wide, but that this did not need to be determined.

17    Thomas v Nash [2010] SASC 153; 107 SASR 309 was a succession case about a similar provision in South Australia containing an exception to the prohibition on the use of a covert recording by a participant if it is “reasonably required for the protection of the person’s lawful interests”. In the context of discussing prior cases including Violi, Le and Sepulveda, Doyle CJ observed:

[47]    In none of those decisions is there an attempt to identify comprehensively the scope of the expression “lawful interests”. That is not surprising. It is an expression which is best left to be applied case-by-case, subject to some general guidelines.

[48]    Each decision is an application of the expression to its particular facts. In most of those decisions it was accepted that a mere desire to have a reliable record of a conversation is not enough. I agree. Most of the decisions proceed on the basis that a desire to gain an advantage in civil proceedings would not ordinarily amount to a relevant lawful interest, although of course each case has to be considered on its facts. Several of the cases proceed on the basis that where the conversation relates to a serious crime, or an allegation of a serious crime, or to resisting such an allegation, a court is more likely to find that the recording of a conversation relating to the crime can be made in the protection of the person’s “lawful interests”.

18    DW v The Queen [2014] NSWCCA 28; 239 A Crim R 192 was an appeal which included a challenge to the decision of a trial judge to admit into evidence a covert recording of a conversation the appellant father had with his complainant adolescent daughter, during which he solicited further sexual conduct with her. The recorded conversation took place after he had engaged in conduct constituting numerous sexual offences for which he was later convicted. The trial judge found that the exclusion in s 7(3)(b)(i) of the Surveillance Devices Act applied, because the recording was reasonably necessary for the protection of the lawful interests of the complainant, being “to protect herself from being the victim of the alleged criminal offences perpetrated by the [appellant]”, and even if that had not been so, would have admitted the recording under s 138 of the Evidence Act.

19    In upholding that ruling in DW v The Queen, Ward JA (with whom Harrison and RA Hulme JJ agreed) surveyed a range of authority, including those referred to above. At [42] and following, her Honour apparently endorsed the view expressed by Johnson J in Sepulveda summarised above, that to meet the test of “reasonably necessary” it is sufficient that the recording of a conversation is reasonably appropriate, rather than essential, for the protection of the lawful interests of the participant who consents to that recording. Her Honour adopted this view while setting out the clear distinction between the factual circumstances of the two cases, seemingly embracing the factual nuance in such matters also addressed by Johnson J in Sepulveda at [125]. Additionally, at [34], her Honour did not express any concern at the conclusion reached by Brereton J (as his Honour then was) in Chao v Chao [2008] NSWSC 584 at [8] that a lawful interest might arise in relation to a recording made where a serious dispute had erupted and it was anticipated there would be a dispute as to different versions of an arrangement. However, that falls short of being a clear endorsement of that expansive view.

20    The conclusion I reach is that all of the above authority provides some assistance and marks out some useful barriers, but the ultimate determination is highly fact-specific and cannot simply be reached through comparison against some exhaustive checklist of factors. All the same, some useful guidance is to be found in the recent succession case of Rathswohl v Court [2020] NSWSC 1490, in which Rees J observed at [35]:

The following considerations may indicate whether recording a private conversation without consent may be “reasonably necessary for the protection of the lawful interests” of the person making the recording.

(a)    Whether the purpose of the conversation was to obtain admissions in support of a legitimate purpose. The contentious subject matter of the conversation, or the characteristics of the person being recorded, may indicate that it was necessary to make the recording in order to secure the admission. Recording a conversation for the purpose of extracting money, inducing further improper conduct or to blackmail the recorded party will indicate to the contrary.

(b)    Whether it was important to protect oneself from being accused of fabricating a conversation and recording the conversation was the only practical means of refuting such an allegation. This is more likely to be the case where the conversation concerns a serious criminal matter or the principal party has a genuine concern for their safety or that of their children.

(c)    Whether there were other practical means of recording the conversation, for example, reporting the matter to police or making a contemporaneous file note.

(d)    Whether there was a serious dispute on foot between the parties, including where determination of the dispute would vitally depend upon oral evidence and thus, one person’s word against another. Recordings of conversations ‘just in case’ there is a dispute, or for the sake of making an accurate record of what was said, is not enough.

Consideration of submissions

21    Mr Cuddihy’s statement, in addition to what is reproduced at [6] above, refers to a history of dealings with Mr Hogan over the preceding year in which, from his perspective, verbal agreements, statements, promises and assurances had been departed from or found not to be correct. It is not necessary or desirable to detail these, beyond observing that they involved Mr Cuddihy (through his business) forming an apparently genuine belief that he had acted to his detriment, or failed to act to his advantage, by reason of taking Mr Hogan at his word. The prosecutor submitted that Mr Cuddihy had lawful commercial interests that he was entitled to protect, in the context of the events on the two days preceding the meeting sought by Mr Hogan, which took place on 6 August 2015. The prosecutor therefore submitted that, given Mr Cuddihy’s lack of trust in Mr Hogan and his expectation that during that meeting Mr Hogan may have made commitments, relevantly on behalf of the Country Care Group, or entered into agreements with Mr Cuddihy’s company through him, a reasonable necessity to record the conversation arose in order to protect Mr Cuddihy’s lawful interests. The prosecutor submitted that there was no realistic option of either telling Mr Hogan that he was recording the conversation, or of taking detailed notes in substitution for the recording.

22    Mr Harrison’s submissions were to the effect that none of the prior events relied upon by the prosecutor reveal dishonesty on the part of Mr Hogan. He submitted that they rather, in effect, demonstrate the ups and downs of business life where outcomes do not match up to predictions, and business people seek to gain advantages where they can, but that this fell well short of dishonesty, let alone fraud. Nor, it was submitted, were there any extant actual lawful interests to protect, but rather possible future interests of a more speculative nature. In any event, Mr Harrison submitted that reasonable necessity has not been established. In particular, relying upon some examples set out by Rees J in Rathswohl v Court at [35], reproduced above, this was not a case in which there was a purpose for the recording like obtaining admissions in support of a legitimate purpose, or a need to protect against fabrication, implicitly falling short of necessity. Nor was the reason for not taking notes or having someone else present good enough to justify a covert recording. This was not a case of an extant dispute, but rather a situation in which the recording more accurately fell within the description of being “just in case”.

23    I have carefully weighed the competing arguments in relation to whether or not the exception in s 7 of the Surveillance Devices Act has been made out. On the one hand, there is little reason to doubt that Mr Cuddihy gave careful consideration as to whether or not he should record the conversation, and only decided to do so a short time before meeting with Mr Hogan. From his perspective at least, Mr Hogan had not been straight with him in his past business dealings and he saw real risk in having the conversation that Mr Hogan had sought. However, he did not anticipate that Mr Hogan would end up talking to him about what is alleged to be a price fixing cartel.

24    I am satisfied that Mr Cuddihy had lawful interests to protect. I am also satisfied, on the strength of his unchallenged statement, that he had a genuine view at the time of the recording that he could not take Mr Hogan at his word, and that he stood to suffer substantial detriment if he was wrong-footed again. That is not to say that his view or perspective on these things was necessarily accurate or fair, but it cannot be said to be a paranoid or unfounded belief from his perspective. There is no reason to conclude that his concerns were other than genuine.

25    I also consider that it was legitimate for Mr Cuddihy to seek to protect those lawful interests by keeping a record of what Mr Hogan told him. However, the prosecutor’s argument founders on the question of whether it was reasonably necessary to protect these interests by the use of a listening device. Doubtless a sound recording was the easiest and arguably best way for Mr Cuddihy to keep an accurate and complete record of what was said at the meeting. However, that does not mean that obtaining that best account of the meeting was reasonably necessary to achieve the objective of protecting his lawful interests. I am not satisfied that it was reasonably necessary to have a verbatim recorded account, given the readily available alternatives not availed of, namely of taking detailed notes during the course of the meeting (or immediately after the meeting if taking notes at the time was not thought practical – see below), or having a witness present (even if that was not going to be conducive to as useful or candid a business meeting taking place).

26    A commonplace way in which someone is able to make a record of a conversation is to do so a short time after a meeting or conversation has concluded. Section 32 of the Evidence Act allows such a note to be used to refresh memory in the witness box, reducing further the need to sound record a conversation secretly. Further, the meeting only took about 40 minutes and it is unlikely that it was contemplated to go for any great length of time, which suggests that it would not have been difficult to take a subsequent file note of what was discussed. There had to be a compelling reason to depart from that normal way for anyone to protect their lawful interests when an important conversation takes place, without the use of a listening device.

27    While the lawful interests that Mr Cuddihy sought to protect were doubtless important to him, in my view it would largely set to nought the protections that are intended to be afforded by s 7(1) of the Surveillance Devices Act if this sort of scenario was permitted to fall within an exception to the prohibition. If it were, people in the course of business and in their ordinary lives could invariably find a way to justify secretly recording a wide range of private conversations. The legislature on behalf of the community has generally not just proscribed, but criminalised, covert recording of this kind.

28    In my view, and based on an extensive consideration of the exception in case law, it is clear that the exception in s 7(3)(b)(i) should not be easily met. The exception or defence in s 7(3) as a departure from the prima facie proscription should not, in my view, be given an expansive interpretation or operation. The exception to that prohibition should not be read so broadly as to give a virtual licence to make a secret recording merely because it is better or more convenient to do so, being the burden of the distinction between DW v The Queen in which the threshold was met as extending beyond that limited justification, and Sepulveda in which the threshold was not met because the need relied upon was insufficient. This case is closer to Sepulveda than to DW v The Queen. It is worth noting that in Sepulveda, where the exception in the Listening Devices Act did not apply, Johnson J determined that the relevant recording would still have been admissible under s 138 of the Evidence Act. I consider the application of that section to the present case below.

29    Mr Cuddihy had ample means to protect the particular lawful interests that he had in contemplation falling short of making a secret recording. That said, the particular lawful interests he sought to protect were not the interests that emerged at the meeting. Had Mr Cuddihy anticipated that Mr Hogan was going to discuss a proposal to engage in serious criminal activity, and had that been the reason for making the recording, it is quite possible, although not very likely, that I might have reached a different conclusion. However, in relation to the lawful interests that Mr Cuddihy in fact had in contemplation, some other process such as contemporaneous notetaking, written confirmation of the meeting discussion by email, or some other ordinary means of recording what had been said, clearly rendered the decision to record the conversation secretly, at the time that decision was made and at the time that the conversation commenced, not reasonably necessary. I therefore conclude that the defence or exception in s 7(3)(b)(i) of the Surveillance Devices Act has not been made out.

Discretion under the Evidence Act

30    I now turn to the question of whether or not I should exercise the discretion under s 138 of the Evidence Act to admit what I have found to be the illegally obtained recording by listening device, and thereby transcript, of the conversation between Mr Cuddihy and Mr Hogan.

31    In the event that the exception in s 7(3)(b)(i) of the Surveillance Devices Act is not made out, the prosecutor submitted, by reference to the mandatory considerations in s 138(3) of the Evidence Act, that:

(1)    the probative value of the evidence is high because the recording demonstrates that Mr Hogan was seeking to have Patient Handling via Mr Cuddihy enter into an illegal cartel arrangement with the Country Care Group;

(2)    the prosecutor’s case in relation to charges 1 to 3 in the indictment would be significantly weakened, such that the importance of the evidence in the proceeding is substantial;

(3)    the offence for which the evidence would be adduced is a serious one and there is a significant public interest in the prosecution of such offences (implicitly, being protective of the public interest in preserving competition);

(4)    an offence against s 7(1) of the Surveillance Devices Act carries a maximum penalty of five years’ imprisonment and is therefore an objectively serious criminal offence, but the gravity of any particular contravention depends upon a range of factors.

(5)    if Mr Cuddihy committed that offence he did not do so for any dishonest gain or to cause any dishonest loss, but to protect what he saw as his legitimate commercial interests, and it is therefore a contravention at the lower end of the range of objective criminality for that offence;

(6)    while the contravention was deliberate in the sense that the recording was deliberate, the contravention was not deliberate in the sense that Mr Cuddihy intended to break the law, but rather thought (incorrectly, as I have found) that he was acting within the law;

(7)    it is unlikely that any proceedings will be taken in relation to Mr Cuddihy recording the conversation, but that is a more substantial consideration when the contravention has been by a person in law enforcement; and

(8)    it was not possible to obtain evidence which provides the same sense as a recording of the conversation without the contravention, but it is implicitly recognised that this is not a strong factor favouring admission as there were viable alternatives that Mr Cuddihy did not apparently consider.

32    The submissions for Mr Harrison in relation to s 138 rely upon an assertion that the contravention was grave and it was not necessary for Mr Cuddihy to record the conversation in order to give evidence about it.

33    Having considered the transcript of the recording I am satisfied that the probative value of the evidence is high and that its importance to this proceeding is substantial: s 138(3)(a) and (b), Evidence Act. While the nature of the offences which are the subject of this proceeding are quite different from cases such as Sepulveda and DW v The Queen, there is no gainsaying the fact that they are very serious crimes, involving alleged conduct of a kind which is against the public interest in effective price competition in the supply of goods and services: s 138(3)(c), Evidence Act.

34    As to the gravity of the breach of s 7(1) and whether it was deliberate or reckless, required to be considered by s 138(3)(d) and (e) of the Evidence Act, I am satisfied that the contravention by Mr Cuddihy is a serious one by reason of the nature of the statutory prohibition and the magnitude of the penalty that can be imposed, being a maximum of five years’ imprisonment. I am also satisfied that while making the recording was deliberate rather than reckless conduct, it was not a deliberate breach of the law. Mr Cuddihy did not appreciate that he was not entitled to record the conversation; to the contrary, he plainly enough thought he was entitled to do so. While ignorance of the law is no excuse, such ignorance may mitigate the seriousness of the offence, and also enliven a discretion not to prosecute: Ostrowski v Palmer [2004] HCA 30; 218 CLR 493 at [2].

35    The gravity of an offence is generally less when someone reasonably believes, in ignorance of the law, that what they have done is lawful. In this case, Mr Cuddihy turned his mind to the aspect of protecting his lawful interests but not to the issue of reasonable necessity. In his committal hearing evidence, he said under oath that he recorded the conversation prompted by his prior history and dealings with Mr Hogan, as outlined above, to protect what he reasonably regarded as his legitimate interests. He was concerned that he was “going to be put in a situation where something would be either said or promised or guaranteed and it would either be revoked, reneged on or not acted on”. This occurred in circumstances in which Mr Hogan had requested the meeting the previous day, and it had taken place at Mr Cuddihy’s business premises.

36    Mr Cuddihy went about protecting his lawful interests in a way that went beyond what he was entitled to do. He went further than the law permitted, but he was not cavalier in the approach that he took. If he had been prosecuted and convicted not only do I doubt that there was any serious prospect that he would be imprisoned, but in the circumstances, depending on an absence of any serious prior convictions, there might well have been a reasonable prospect of no conviction being recorded. I am satisfied that in all the circumstances, while not trivial, it was not a very serious example of a contravention of s 7(1).

37    As to s 138(3)(f) of the Evidence Act, I attach no additional significance to the interference with Mr Hogan’s privacy, in breach of article 17 of the International Covenant on Civil and Political Rights. I have particular regard to the fact that the recording took place at Mr Cuddihy’s place of work, not any premises occupied by Mr Hogan or any public place: see Kadir v The Queen [2020] HCA 1; 375 ALR 80 at [47].

38    In relation to s 138(3)(g) of the Evidence Act, it seems most unlikely that proceedings will be taken against Mr Cuddihy for the breach of s 7(1) that I have found has taken place. In my view that is of less weight when it is a contravention by a member of the general public, rather than by a law enforcement official, being the circumstance in Bunning v Cross (1978) 141 CLR 54, which was the genesis of s 138. Overall, I regard the fact of no such proceedings being likely as a neutral factor: see Kadir at [16].

39    I turn to the difficulty of obtaining the evidence without impropriety or contravention of an Australian law, which is required to be considered by s 138(3)(h) of the Evidence Act. As the High Court observed in Kadir at [18], the provenance of that provision can be traced to the highway patrolman in Bunning v Cross, who mistakenly failed to require a driver to undergo a preliminary breath test, which was at that time a legislative precondition to requiring a driver to undergo a breathalyser test. The illegality was slight even though compliance would have been easy. In this case, the obtaining of the verbatim recording legally was not practically possible, in the important circumstance that Mr Cuddihy was not expecting the content of the conversation that ended up taking place to involve any illegality. However, he did not set about to break the law because of any knowledge that he could not make the recording lawfully, and instead did so in order to protect what I have found to be his lawful interests. This does to an extent weigh against admission, but not to a marked degree: Kadir at [16].

40    The practical reality is that while a version of the evidence could have been obtained by Mr Cuddihy taking contemporaneous notes, the evidence in specie could not and almost certainly would not have been obtained except by the contravention. A contemporaneous note cannot capture the same nuances and detail that a recording can. Again, this is a less substantial consideration when the illegality is by a member of the public, especially one endeavouring to obey the law, as opposed to a law enforcement official, again a key factor discussed in Bunning v Cross. In any event, Mr Cuddihy would most likely have been entitled to give a version of the conversation from his memory, so the real issue concerns the quality of the evidence before the jury, rather than its total absence. However, once again, it is impossible to say that evidence given in oral testimony about the conversation would be likely to be as probative as a recording, which could only be obtained by the contravention. Overall, this aspect weighs somewhat in favour of exclusion.

41    The conclusion I reached is that, in all the circumstances, the desirability of admitting the electronic recording and transcript of the conversation that was in fact recorded by Mr Cuddihy (as opposed to the conversation he thought he would be recording) comfortably outweighs the undesirability of admitting that evidence having regard to the way in which was obtained. I therefore propose to admit the evidence at the trial. The foregoing are the reasons for the ruling given on 27 November 2020, as follows:

(1)    The defence or exception in s 7(3)(b)(i) of the Surveillance Devices Act 2007 (NSW) has not been made out, such that Mr Cuddihy’s recording of the private conversation between himself and Mr Hogan on 6 August 2015, without Mr Hogan’s consent, was a contravention of s 7(1)(b) of that Act.

(2)    The desirability of admitting the recording and transcript of that private conversation outweighs the undesirability of admitting evidence that has been obtained in contravention of s 7(1)(b) of the Surveillance Devices Act, and accordingly I exercise the discretion in s 138 of the Evidence Act 1995 (Cth) to allow that evidence to be adduced.

Associate:

Dated:    18 December 2020