Re Bankers Trust Australia Limited; Bt Australia Limited; Bt Securities Limited; Bt Asset Management Limited; Bt Financial Services Limited; Pendal Nominees Pty Limited; Gary Lord; David Bennett; John Mcfarlane; Andrew Cameron; Greg Gorham; Peter Warne; K [1989] FCA 45 (3 March 1989)

FEDERAL COURT OF AUSTRALIA

Re: BANKERS TRUST AUSTRALIA LIMITED; BT AUSTRALIA LIMITED; BT SECURITIES
LIMITED; BT ASSET MANAGEMENT LIMITED; BT FINANCIAL SERVICES LIMITED; PENDAL
NOMINEES PTY LIMITED; GARY LORD; DAVID BENNETT; JOHN MCFARLANE; ANDREW
CAMERON; GREG GORHAM; PETER WARNE; KIM GILBERT; GEOFFREY IAN MARTIN; RICHARD
STEELE; ANDREW ROYDHOUSE; PHILLIP MOFFITT; DEAN CASHMAN; SUSAN BATE; IVAN
RITOSSA; OLEV RAHN; CRAIG TURNBULL; DENNIS TIGHE; BEN BRAHAM; MICHAEL
CRIVELLI; GREG MAUGHAN and ROSS FINLEY
And: NATIONAL COMPANIES AND SECURITIES COMMISSION
No. NSW G30 of 1989
FED No. 63
Administrative Law

COURT

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
M.L. Foster J.(1)

CATCHWORDS

Administrative Law - Natural Justice - private hearing before National Companies and Securities Commission - power of Commission to make orders prohibiting the disclosure of evidence given before a private hearing - consideration of the professional and ethical constraints and practices applying generally to the discussion of evidence given during the currency of proceedings - entitlement of witnesses and their solicitor to transcript of the testimony given by witneses before a private hearing - rights to call evidence and make submissions before the termination of the hearing.

Companies (New South Wales) Code

National Crime Authority Act 1984

Trade Practices Act 1974

Futures Industry (New South Wales) Code

National Companies and Securities Commission Act 1979

Administrative Decisions (Judicial Review) Act 1977

Scott v Scott (1913) AC 417

Re Trade Practices Tribunal; ex parte Tooheys Limited (1977-1978) 16 ALR 609

Re A Barrister and Solicitor 29 ACTR 25

John Fairfax and Sons Limited v Police Tribunal of New South

Wales and Another (1986) 5 NSWLR 465

Attorney General for New South Wales v Mayas Pty Ltd N.S.W. Court of Appeal, unreported, 21 October, 1988.

National Companies and Securities Commission v News Corporation Limited [1984] HCA 29; (1984) 156 CLR 296

Russell v Duke of Norfolk (1949) 1 All ER 109

A Guide to Conduct and Etiquette at the Bar (1975) Sir William Boulton (6th ed.) and Supplement (1978)

The Victorian Bar - Professional Conduct, Practice and Etiquette (1979) Sir Gregory Gowans Q.C.

New South Wales Bar Association Rules RR 32 and 53

HEARING

SYDNEY
3:3:1989

Applicants: Mr W.H. Nicholas QC and Mr B.R. McClintock instructed by

Allen Allen and Hemsley

Respondent: Mr G. Cantwell and Ms D. Chang

ORDER

Order that the respondent was not empowered to make any decisions or order requiring the applicants or their solicitors not to discuss or disclose evidence or exhibits (whether oral or written) given during the course of the inquiry now being conducted by the respondent and referred to in paragraph 2 of the affidavit of Anthony Geoffrey Hartnell sworn 3 February 1989 herein (hereinafter referred to as "the inquiry").

Order that the respondent provide to the solicitors for the applicants a copy of the transcript of the evidence of all applicants for whom those solicitors appear in the inquiry.

Order that in the event that the respondent comes to the opinion that it is likely on the material before it to make a finding adverse to any person or persons or to recommend prosecution of any person or persons, it provide to that person or persons the opportunity to make submissions against the taking of that course and to call such relevant evidence as he or they may be advised.

Order the respondent to pay the applicants' costs of the proceedings.

DECISION

The respondent in these proceedings, the National Companies and Securities Commission ("the Commission") is currently conducting an investigation, through its Futures Industry Division, into trading in the Sydney Futures Exchange September 1988 Ten Year Bond Contract and in relevant Commonwealth Government Bonds and Futures Contracts to determine whether offences have been committed under s 130 of the Futures Industry (New South Wales) Code by any person. On the 23rd of November 1988 the Division resolved that, as part of the investigation, a hearing be held pursuant to s 36 of the National Companies and Securities Commission Act 1979 ("the Act"). The Commission also directed, pursuant to s 36(2) of the Act "that the hearing take place in private". The hearing was to take place before Messrs. C. Williams and K. McPherson, members of the Futures Industry Division of the Commission.

2. On the 30th November 1988 summonses were issued by the Commission pursuant to s 37(1) of the Act. The seventh to twentieth Applicant's herein, all being employees of the first second or third Applicant were recipients of summonses requiring them to attend before the Commission at the hearing and give evidence. The first to sixth Applicant ompanies and the twenty-first to twenty-seventh individual Applicants received summonses to produce documents at the hearing. All these applicants are represented in these proceedings and at the hearing before the Commission, by Anthony Geoffrey Hartnell, solicitor.

3. The hearing before the Commission commenced on 12th of December 1988 and has continued on the 13th and 14th of December 1988 and on the 23rd, 24th and 25th of January 1989. It would appear that it is now approaching its closing stages.

4. During the hearing certain questions have arisen which provide the subject matter of the current proceedings before this Court. Stated broadly, the questions relate firstly to the entitlement or otherwise of the various witnesses and Mr Hartnell to discuss evidence given and documents produced at the private hearing amongst themselves or with appropriate executives of the employer companies,and whether the Commission has power to make orders prohibiting such discussion, secondly the entitlement or otherwise of Mr Hartnell and the various witnesses to be given trancript of the testimony given by the witnesses before the Commission and thirdly the extent of the Applicants' rights to call evidence and make submissions before the termination of the hearing. The Application to this court is made pursuant to ss 5 and 6 of the Administrative Decisions (Judicial) Review Act 1977. Before considering the questions that arise for determination, it is necessary to set out the history of the matter as it appears from material placed before the Court and also the relevant statutory provisions.

5. It appears that the Commission commenced investigations into the relevant trading in early September 1988. Prior to its decision to hold a hearing the Commission engaged in fairly extensive correspondence with some or all of the corporate applicants. This correspondence sought information as to the course of trading on the relevant day. Mr Hartnell was involved in the giving of advice in relation to the answering of the Commission's enquiries. A large bundle of correspondence relating to this period is annexed to the affidavit of Mr Hartnell, filed in these proceedings. No particular reference has been made to any part of it in the hearing before this Court. It is relied upon simply as an indication of the complexity and technical nature of the matters under investigation. The correspondence, in fact, amply demonstrates this complexity and establishes to my satisfaction, that any legal representative in the position of Mr Hartnell would need to spend considerable time and exercise considerable care in acquiring a full understanding of all the ramifications of the matters involved.

6. When Mr Hartnell became apprised of the Commission's decision to hold a hearing, he wrote to it, on 2nd December, 1988, inquiring (inter alia) as to the basis upon which the enquiry and hearing were to be held. On the same day he received a reply from the Commission which (excluding formal parts) was as follows:-

"The Commission is holding the hearing scheduled to
commence on 12 December 1988 for the purpose of
exercising its power under section 19 of the
Futures Industry (New South Wales) Code to make
such investigation as it thinks expedient for the
due administration of that code.
The Commission will be investigating by way of the
hearing the trading of the Sydney Futures Exchange
September 1988 Ten Year Contract and related bond
trading to determine whether offences have been
committed under section 130 of the Futures
Industry (New South Wales) Code.
Mr Danks as an authorized person exercised the
powers under section 12(3) of the Companies (New
South Wales) Code for the purpose of the
performance of a function or the exercise of a
power by the Commission, namely its power to
conduct an investigation pursuant to section 19
Futures Industry (New South Wales) Code and
pursuant to section 12(b) in examination of matter
that may constitute a contravention of the Futures
Industry (New South Wales) Code. I also refer you
to regulation 19 of the Companies regulation."

7. In response to a further request for information from Mr Hartnell, the details of which do not matter, the Commission, on the 9th of December, 1988, replied as follows:-

"As you are aware the hearing is in the nature of
an investigation pursuant to section 19 of the
Futures Industry (New South Wales) Code and is to
be held in private. The Commission is not obliged
to disclose the nature of the evidence which will
be presented at the hearing and declines to do so.
No doubt it would be open to you to make such
application as you see fit to the Commission at
the commencement of the hearing in respect of your
right of attendance during the hearing.
In answer to your second question the Commission
has reason to suspect that offences under section
130 of the Futures Industry (New South Wales) Code
may have been committed in connection with the
trading of the Sydney Futures Exchange September
1988 Ten Year Bond Contract. The hearing is being
conducted to investigate whether offences have
been committed by any person."

8. It is not disputed that the Commission was empowered to hold an investigation and hearing pursuant to the statutory provisions set out in these letters. S130 of the Futures Industry (New South Wales) Code relates to the creation or maintenance of artificial prices for dealing in futures contracts on a futures market. There is no need to set it out in these reasons. S 19 of the Futures Industry (New South Wales) Code reads as follows:-

"19 Where the Commission has reason to suspect
that-
(a) an offence under a provision of a relevant
Code or against any other law with respect to
dealing in futures contracts; or
(b) an offence relating to futures contracts that
involves fraud or dishonesty,
may have been committed, the Commission may make
such investigation as the Commission thinks
expedient for the due administration of a relevant
Code."

9. It is quite apparent that this section provides the Commission with a very wide discretionary power of investigation.

10. The statutory provisions governing hearings before the Commission are set out in part V1 of the Act.The relevant sections for present purposes are the following:-

"36(1) The Commission may hold hearings for the
purpose of the performance of any of its functions
or the exercise of any of its powers.
36(2) Subject to this section, where the
Commission is required or decides to hold a
hearing, the Commission may either direct that the
hearing take place in public or direct that the
hearing take place in private.
36(5) Where the Commission directs that a hearing
to be held by it take place in private, the
Commission may give directions as to the persons
who may be present at the hearing.
36(6) Where, at a hearing by the Commission that
is held in public, the Commission is satisfied
that it is desirable to do so by reason of the
confidential nature of any evidence or matter or
for any other reason, the Commission may-
(a) direct that the hearing or a part of the
hearing take place in private and give directions
as to the persons who may be present; or
(b) give directions preventing or restricting the
publication of evidence given before the
Commission or of matters contained in documents
lodged with the Commission.
36(7) Nothing in any direction given by the
Commission under sub-section (5) or paragraph
(6)(a) prevents the presence at a hearing of-
....
(c) a person representing, pursuant to sub-section
38(2), a person who, by reason of a direction
given by the Commission under sub-section (5) or
paragraph (6)(a), is entitled to be present at the
hearing.
36(8) Where the Commission directs that a hearing
or part of a hearing before the Commission take
place in private, a person (other than a member of
an acting member, or a member of the staff of the
Commission approved by the Commission shall not be
present at the hearing unless he is entitled to be
present by virtue of the direction or by virtue of
sub-section (7).
37(1) A member or an acting member may summon a
person to appear before the Commission at a
hearing to give evidence and to produce such
documents (if any) as are referred to in the
summons.
37(2) The Commission may, at a hearing, take
evidence on oath or affirmation and for that
purpose a member or an acting member may-
(a) require a person appearing at the hearing to
give evidence either to take an oath or make an
affirmation; and
(b) administer an oath or affirmation to a person
so appearing at the hearing.
37(3) The oath or affirmation to be taken or made
by a person for the purposes of this section is an
oath or affirmation that the evidence he will give
will be true.
38(1) At a hearing before the Commission-
(a) the proceedings shall be conducted with as
little formality and technicality, and with as
much expedition, as the requirements of any Act or
State Act and a proper consideration of the
matters before the Commission permit;
(b) the Commission is not bound by the rules of
evidence;
(c) the Commission may upon such conditions as it
thinks fit, permit a person to intervene in the
proceedings;
(d) the Commission shall observe the rules of
natural justice;
38(2) At a hearing before the Commission-
...
(d) any person may be represented by a barrister
or solicitor of the Supreme Court of a State or
Terrtory or of the High Court.
39(2) A person appearing as a witness at a
hearing before the Commission shall not, without
reasonable excuse-
(a) when required pursuant to section 37 either to
take an oath or make an affirmation - refuse or
fail to comply with the requirement;
(b) refuse or fail to answer a question that he is
required to answer by the member or acting member
presiding at the hearing; or
(c) refuse or fail to produce a document that he
was required to produce by a summons under this
Act served on him as prescribed.
39(5) It is not a reasonable excuse for the
purposes of sub-section (2) for a person to refuse
or fail to answer a quesion put to him that the
answer might tend to incriminate him but, where
the person claims, before answering the question,
that the answer might tend to incriminate him,
neither the question nor the answer is admissible
in evidence against him in criminal proceedings
other than proceedings for a contravention of
sub-section (3) or proceedings in relation to a
charge of perjury in respect of the answer.
40 A person shall not-
(a) insult a member or an acting member in the
performance of his functions or the exercise of
his powers as a member or acting member at a
hearing before the Commission;
(b) interrupt a hearing before the Commission;
(c) create a disturbance, or take part in creating
or continuing a disturbance, in or near a place
where the Commission is holding a hearing; or
(d) do any other act that would, if the Commission
were a court of record, constitute contempt of
that court.
Penalty: $1,000 or imprisonment for 3 months.

11. On the 12th December, 1988 Mr Hartnell appeared for his various clients at the Commission's hearing. He made a number of applications in respect of which he obtained rulings from the Commission. Not all of the applications and rulings are relevant for present purposes. However, Mr Hartnell raised and sought rulings in respect of the topics referred to above. These topics were raised again on subsequent hearing days and also referred to in correspondence. It is convenient that I deal separately in these reasons with each topic and its related facts.

12. The first and most significant topic is what has been referred to in argument as the "non-disclosure order". The manner in which this question arose is set out in the portion of the transcript of the hearing on the 12th December, 1988 which is exhibit DHD1 to the affidavit of David Hilton Danks of the 9th February 1989.

13. As one of his applications, Mr Hartnell sought "consent to my being allowed to discuss with any relevant employee of Bankers Trust that participated in either the strategy or decision-making or dealing processes in relation to Bond trading, evidence that has been adduced before this Tribunal, for the purposes of me putting further evidence before you as may be relevant through individual or corporate witnesses." This consent was refused. Some further discussion ensued and then Mr Hartnell said "I understand your order to the effect that if something is raised adverse to person A by person B I cannot tell person A about it", to which the chairman responded "I think you understand that very well, Mr Hartnell" Mr Hartnell continued "nor can person B tell anyone about it" whereupon counsel assisting the Commission said "yes that is the nature of a private hearing". It would appear that this latter statement was acquiesced in and adopted by the Commission.

14. Later that day, at the conclusion of the evidence of the first witness (the seventh applicant) the chairman Mr Williams made the following statement to him "May I caution you that this is a private hearing pursuant to s 36(4) of the National Companies and Securities Act and that requires that you not discuss either questions asked or answers given or exhibits given or provided with any person other than your legal counsel. Any breach of that requirement would be a contempt of the Commission."

15. He also addressed Mr Hartnell as follows;"Of course, following our discussions earlier, Mr Hartnell, you will appreciate that what I have said to the witness applies equally to his legal representative". Mr Hartnell responded "Yes, I understand it perfectly" and Mr Williams said "I am sure you do."

16. As I understand the submissions in this case, Mr William's statement to both the witness and to Mr Hartnell constitute what is said to be the "non-disclosure order" in respect of which relief is sought in these proceedings.

17. The question was again adverted to at the hearing on the 23rd January 1989. The relevant transcript is exhibit DHD3 to Mr Dank's affidavit. For present purposes it is sufficient to indicate that Mr Hartnell raised again the question of the entitlement of a witness to discuss with others the evidence he had given before the Commission and made submissions as to whether such discussions would constitute contempt of the Commission. The Commission also heard submissions from Counsel assisting. On the following day Mr Williams gave a ruling. He said to Mr Hartnell "We have reconsidered your submission of yesterday in respect of the caution to witnesses that has been given as regards the communication of evidence given in the hearing. I have looked at the transcript and what it says on the first occasion." Mr Williams then set out his remarks at the conclusion of the first witnesses evidence, as set out above. He then continued "We are not persuaded to move from that position and whilst we believe that we have power to release you or any witness from the full obligation of privacy, we do not believe that it is appropriate to do so and do not propose to do so."

18. It should be added that in subsequent correspondence, particularly a letter of the 29th January, 1989 from Mr Hartnell to the Commission (exhibit AGH 13 to Mr Hartnell's affidavit) express reference is made to Mr Hartnell's being "expressly bound by the directions as to confidentiality of matters in evidence before the hearing". There has been no response emanating from the Commission to the effect that what had been stated in the pasages referred to above did not amount to a "direction" or "order" ofthe Commission on the subject of non-disclosure of evidence given before it.

19. I mention this matter because in the proceedings before this court the Commission through its solicitor has submitted that Mr Williams' statement to the witness and to Mr Hartnell could not be construed as an "order" or a "direction" with the result that the review provisions of the Administrative Decisions Judicial Review Act 1977 could not apply to it. This submission has occasioned me some difficulty. Certainly if the words are taken out of context they may well answer the description of a caution or admonition rather than an order or direction being, in effect, an expression of opinion that if the conduct referred to were engaged in, it would amount to a contempt of the Commission and, perhaps, a statement of intention to take proceedings for contempt if the conduct were in fact engaged in. So regarded, the statement would, of course, amount to no more than a caution, albeit sternly administered, and not to a direction or order capable of being disobeyed. I have come to the conclusion, however, that, viewed in the context of the discussion that had previously occurred it should properly be regarded as a ruling or order to the effect that non-disclosure was enjoined upon both the witness and his legal representative. Subsequent discussion of the matter as shown in the transcript and correspondence indicates quite clearly that all concerned regarded it as an order or direction capable of being obeyed or disobeyed.

20. The applicants' submission in relation to this order or direction is twofold. Firstly, it is put that the Commission has no power to make an order prohibiting a person rightfully present during a private hearing from disclosing evidence given in the hearing. Secondly, it is argued that even if such power existed then the order made in the present instance exceeded the ambit of the power.

21. The Commission submits that, on a proper construction of the relevant subsections of s 36 of the Act, it has the necessary power to make non-disclosure orders. It argues that the power to direct that the investigative hearing take place "in private" necessarily carries with it or encompasses a power to order that those whose presence is permitted by it during the private hearing shall not disclose the oral or documentary testimony given during that hearing. It further submits that this construction is supported by a consideration of s 36(6). That section, in circumstances where during a public hearing it appears necessary to the Commission that portion of the evidence be not disclosed, gives the Commission the option of directing that the hearing proceed in private or that it continue in public, subject to the Commission's power to make a non-disclosure order in respect of that evidence. The Commission submits that, in these circumstances, the intention of the legislature must have been that when the Commission was to sit in private it should have all necessary power to protect the privacy of the hearing by making appropriate orders as to the non-disclosure of evidence given during the hearing. In other words, it was giving to the Commission, in s 36(6), as a matter of convenience, the power to do in a public hearing one of the things that it could do in a private hearing by virtue of the very nature of that hearing, i.e. make orders preventing the publication of materials sought to be kept secret.

22. This submission has a beguiling simplicity and symmetry. However, I have come, with some reluctance, to the view that I cannot accept it. Counsel for the applicants has made compelling submissions to the contrary based upon statements of principle in cases of high authority. These statements are to the effect that an order that a case be heard in camera does not of itself require that there be no publication of the evidence taken in the closed proceedings. A further specific order for non-disclosure is necessary to effect that result. Here the legislature has seen fit to empower the Commission to direct only that its investigative hearing shall be in private. In relation to such private hearings it has not taken the next step of empowering the Commission to make orders for non-disclosure of testimony taken in the hearing. It has only given the Commission such a power in relation to proceedings which are being conducted in public. The situation is to be contrasted with that of the National Crime Authority. By s 25(5) of the National Crime Authority Act 1984 the Authority may hold hearings for the purpose of a special investigation (s 25(1)) and such a hearing shall be held in private (s 25(5)). By s 25(9) the Authority is given specific power to direct that any evidence oral or documentary given before it shall not be published at all or not published except in such manner and to such persons whom the Authority specifies. The applicants' submission is that, without the addition of an express power of this kind, the mere granting to the Commission of the power to direct that a hearing before it take place in private does not enable it to make relevant non-disclosure orders.

23. The cases upon which the applicants rely are, for the most part, cases dealing with the inherent powers of courts to regulate their own procedures in the interests of justice. However, I do not consider that this raises any significant point of distinction in the present circumstances. If an in camera order made by a Court in respect of the whole or part of a hearing before it does not, in itself, embrace a direction that the evidence given at the hearing shall not be disclosed outside it, then a power given to a merely statutory body, which can have no inherent powers, to direct that a hearing before it be conducted in private cannot carry with it a further unspecified power to prevent or restrict publication of evidence given at the hearing. A court, by virtue of its inherent powers can add a non-disclosure order to an in camera order. A statutory body having no such inherent powers, cannot unless authorized to do so by statute.

24. I do not propose in these reasons to undertake a full survey of the relevant case law. The starting point is the well known authority of Scott v. Scott (1913) AC 417, a case in which the House of Lords primarily considered the circumstances in which courts might make in camera orders in respect of proceedings before them. However, statements of high authority were made in the speeches as to what was encompassed by such an order when made. Thus Lord Atkinson said (at p 453):-

"Speaking for myself I must therefore decline to
give to the order of the learned Judge, that this
nullity suit be heard in camera, a meaning and
operation for which, as I can see it, there is no
true analogy, no precedent, no authority direct or
implied, and no imperative necessity.
I think the order in its true interpretation means
what on its face it plainly says, and nothing
more, namely, this, that the place where the case
is to be heard shall be a private chamber, not a
public Court."

25. Scott v. Scott was relied upon in the judgment of Franki J. (with whom Northrop J. agreed) in re Trade Practices Tribunal Ex parte Tooheys Limited (1977-1978) 16 ALR 609, a decision of the Full Court of the Federal Court of Australia. This case dealt with a section of the Trade Practices Act 1974 which is similar in many respects to s 36 of the Act. The relevant statutory provisions are as follows:-

"(1) Subject to this section, the hearing of
proceedings before the Tribunal shall be in
public.
(2) Where the Tribunal is satisfied that it is
desirable to do so by reason of the confidential
nature of any evidence or matter or for any other
reason, the Tribunal may-
(a) direct that a hearing or part of a hearing
shall take place in private and give directions as
to the persons who may be present; or
(b) give directions prohibiting or restricting the
publication of evidence given before the Tribunal,
whether in public or in private, or of matters
contained in documents filed or lodged with the
Registrar, received in evidence by the Tribunal or
placed in the records of the Tribunal.

26. It will be seen that the Tribunal's power to direct that a hearing before it shall take place in private and to give directions as to the persons who may be present corresponds exactly with the powers given to the Commission under s 36 of the Act. The Tribunal, however, is given the additional power in relation to both public or private hearings to make appropriate non-disclosure orders. It was necessary for the court to consider the construction of these subsections. As part of his consideration, Franki J. (with whom Northrop J. agreed) made the following comments (at p 617-618):-

"The effect of an order that "I do further order
that this cause be heard in camera" standing
alone, upon the publication of evidence, was
considered by the House of Lords in Scott v. Scott
(1913) AC 417; (1911-13) All ER Rep 1. That case
involved nullity proceedings and at the conclusion
one party, apparently being concerned to protect
her reputation, sent copies of the transcript to
three persons, two of whom were relations. The
House held that the order that the proceedings be
heard in camera was made without jurisdiction and
the view was also expressed by way of dicta, that
assuming there was jurisdiction to make the order,
it did not prevent all subsequent publication of
the proceedings. In the circumstances of Scott v.
Scott no statutory power existed to make the order
which was made. However that case seems very
helpful upon the question of how far if at all, an
order that a case be heard 'in camera' operates to
prohibit the publication of evidence given 'in
camera'. I can see no relevant difference between
an order that proceedings be in camera and an
order that they be 'in private' or 'in
confidential session'.
"Scott v. Scott is an authority for the proposition
that such an order is not equivalent to an
injunction of perpetual secrecy (see Earl of
Halsbury (AC) at 443, Earl Loreburn at 447-9 and
Lord Atkinson at 449-50.
"Lord Atkinson at 453 said: 'I think the order in
its true interpretation means what on its face it
plainly says, and nothing more, namely, this, that
the place where the case is to be heard shall be a
private chamber, not a public court.'
"I take from that case the proposition that an
order that a matter be heard in camera does not,
of itself, absolutely prohibit all publication,
without further order, of the evidence given in
camera.
"Applying the principles of Scott v. Scott, supra,
I consider that if the Tribunal makes an order
only that the proceedings be in private and
enumerates the persons entitled to be present,
there is no absolute prohibition on the
publication of evidence given in the private
session, certainly if this be only for the purpose
of a legal adviser who was present, and not
excluded, obtaining appropriate instructions from
his client.
"The express power which the Tribunal has under s
106(2)(b) to restrict the publication of evidence
also points to the conclusion that, in the absence
of any express order under that power, the general
order that proceedings be in private and that only
certain people may be present, does not restrict
all publication of that evidence."

27. Having regard to the close similarity between the legislation considered in the case and the provisions of s 36 of the Act, I must consider this case a most persuasive authority.

28. Scott v. Scott and Ex parte Toohey were both applied by Blackburn CJ. in Re A Barrister and Solicitor 29 ACTR 25, where a declaration was sought that the Law Society was not entitled to disclose to a person not present at a hearing of the Disciplinary Committee held under the relevant Ordinance, evidence taken when the hearing was closed to the public. It was argued that the showing of a portion of the transcript of the hearing to a person not present at the hearing for the purpose of obtaining instructions for cross examination was a breach of the relevant section of the Ordinance requiring that the hearing be held in private. Blackburn CJ. stated that, as a matter of construction,he had no difficulty in concluding that the section did not prevent the disclosure. He added 'I am, however, considerably fortified in this conclusion by the analogy of Scott v. Scott (1913) AC 417. I respectfully agree with the observation of Franki J. sitting in the Federal Court in re Trade Practices Tribunal Ex parte Tooheys Limited (1977) 16 ALR 609 at 618 as follows: "I take from that case the proposition that an order that a matter be heard in camera does not, of itself, absolutely prohibit all publication, without further order, of the evidence given in camera."

29. "In my opinion the same principle applies here, where there is a statutory provision that the enquiry be "not ... open to the public". It would have been very easy for the legislature to have made explicit provision for the prohibition or limitation of the publication of evidence given at the enquiry, but it has completely failed to do so."

30. The case of John Fairfax and Sons Limited v. Police Tribunal of New South Wales and another (1986) 5 NSWLR 465 is also of considerable assistance. In that case the Police Tribunal of New South Wales, a statutory body, was hearing departmental charges against a certain police officer. In the course of the hearing it made an order in respect of a witness that, (inter alia) his name be not published in reports of the proceedings. The relevant statute contained no specific power enabling the Tribunal to prohibit publication of evidence taken before it. S 44(1) of the statute gave members of the public a right of access to the proceedings unless the Tribunal made an order excluding them. In these circumstances McHugh JA. (with whom Glass JA. agreed) stated as follows (at p 481):-

"Section 44(1)(b) gives members of the public a
statutory right to attend the hearing. The
paragraph also gives the Tribunal power to exclude
members of the public from the proceedings. I
have no doubt that the power extends to excluding
individual members of the public from attending
the proceedings. But I cannot see any
justification for holding that a power to exclude
people from the proceedings includes a power to
prevent the publication of evidence in the
proceedings by persons who do attend the hearing
or includes a power to prevent persons who do not
attend the hearing from receiving details of the
evidence. In my opinion there is no similarity
between a power to exclude people from proceedings
and a power to prohibit publication by either
those who are permitted to attend the proceedings
or to those who do not attend."(see also Attorney
General for New South Wales v. Mayas Pty Limited
NSW Court of Appeal, unreported 21 October, 1988).

31. A consideration of these cases and of the passages cited brings me to the conclusion that the legislature has not given to the Commission power under the Act to make orders for non-disclosure of evidence in private hearings before it. It has merely given it power to direct that a hearing shall take place in private and to give further directions as to who shall be permitted to be present at the hearing. Accordingly, I uphold the applicants' submission that there was no power to make the non-disclosure order complained of.

32. This does not mean, of course, that there exists an unfettered right in persons present at private hearings of the Commission, whether as witnesses or legal representatives, to publish evidence given in those hearings.

33. In the first place that publication could involve the publisher in incurring liability for contempt of the Commission (s 40(d)). Although no contempt could occur from the mere flouting of a non-disclosure order as to certain evidence, in circumstances where there was no power to make it, it could still arise if the evidence were disclosed in circumstances that constituted a wilful interference with the due conduct of the inquiry. This question has not been the subject of argument in these proceedings and it would be quite inappropriate to enter into any consideration of the circumstances in which such a contempt could be committed in the present case. Generally speaking, however, if someone privy to the evidence given in a private hearing were to use that knowlege improperly and deliberately to aid the concoction of favourable evidence to be given by some witness yet to be called, such conduct could clearly be held in contempt of the Commission. Whether disclosure in other circumstances and for other purposes could amount to contempt could only be decided when all the facts and circumstances were fully known.

34. In the second place there are the usual professional and ethical constraints applying to the discussion of evidence given in proceedings during the currency of those proceedings. It has long been a rule of practice in Court proceedings that witnesses to be called in a case should not be present in Court and hear the evidence of other witnesses lest they be tempted to trim their own evidence to suit the developing situation. This healthy commonsense practise is, for the most part, regularised by the making of the "order for witnesses" at the commencement of a hearing, namely that witnesses are "commanded to leave the court and the hearing of the court until called upon to give their evidence." The purpose of this usual order would, of course, be undermined if there were not a corresponding rule of professional practice that a witness be warned that the evidence given by him in Court should not be discussed by him with witnesses who are yet to give their evidence, or with anyone who could bring the evidence to the attention of such witnesses. It is, of course, both customary and desirable for legal practitioners to give such warnings to witnesses called in their case. Great care must always be exercised by legal practitioners when conferring with witnesses yet to be called in circumstances where they know the evidence, particularly the cross examination, of witnesses already called, especially witnesses on their own side of the record. It is important for the due administration of justice that such practitioners, should not make known to witnesses yet to be called what was the evidence given by prior witnesses. It is a well known fact in the legal profession that it is both possible and essential in obtaining instructions during the running of a case, not to make known to the witness from whom these instructions are being sought, the evidence which has been given in Court and which requires the obtaining of those instructions. Considerable care is required, but the operation is successfully performed every day by skilled and conscientious lawyers. Clearly the same care is appropriate in warning witnesses and in obtaining instructions from witnesses yet to be called in a hearing before the Commission, as in a court hearing.

35. The above remarks are, of course, not intended to be exhaustive. Rules in relation to communications with witnesses, intended witnesses and potential witnesses are expounded in well-known works on professional ethics (see eg. A Guide to Conduct and Etiquette at the Bar (1975), Sir William Boulton (6th ed.) and supplement (1978); The Victorian Bar - Professional Conduct, Practice and Etiquette (1979), Sir Gregory Gowans QC) and in the rules of Bar Associations (see eg The New South Wales Bar Association Rules, RR 32 & 53) to which reference may be made. The important point is that it may be assumed that in appearing before the Commission the legal representatives of witnesses will scrupulously apply the appropriate professional principles and practices in their dealings with them.

36. In the circumstances, it is unnecessary for me to deal with the applicants' submission that, were the Commission empowered to make non-disclosure orders, the order made in this case exceeded the power. I should, perhaps, indicate, however, that the submission that the order, being unlimited as to scope and duration, was ultra vires, had, in my view, considerable weight.

37. I turn now to the applicants' next area of complaint, namely that the Commission is refusing to provide copies of the transcript of evidence taken in the hearing. This complaint is based upon the Commission's statutory obligation to observe the rules of natural justice (s 38(1)(d)).

38. The essential facts of the matter would appear to be that from the comencement of the hearing, Mr Hartnell, as legal representative of each of the witnesses called to give evidence and of all persons required to produce documents, sought that the witness (and presumably himself) be provided with a copy of the transcript of the evidence of each witness. The application must be considered as one for provision of transcript within a reasonable time, having regard to the administrative difficulties, which now appear to be universal, of obtaining transcript of evidence on a daily basis. The Commission has indicated to each witness at the conclusion of his testimony that he will receive a transcript of his evidence but not necessarily immediately. In response to requests for the provision of transcript to Mr Hartnell the Commission has indicated that it will provide transcript when it, considers it appropriate to do so.

39. The hearings of the Commission have taken place on the days in December 1988 and January 1989 already indicated. Transcript for the December hearing days has not been provided despite repeated requests by Mr Hartnell and his staff and no firm indication has been given as to when such transcript might be forthcoming. The same can be said in respect of transcript of evidence taken on the hearing days in January. The position would appear to be that the evidence of all of the witnesses except one, David Bennett, has been taken and that in respect of this witness, his re-examination by Mr Hartnell is yet to take place. None of the witnesses, however, have been released and each one is subject to recall by the Commission for further questioning until such time, presumably, as the hearing is formally terminated. It is the applicants' contention, moreover, that they should be entitled to the recall of any witness for further questioning should it in their view be desirable to put, on mature reflection, further information before the Commission relevant to the Commission's investigation. Subject to those matters, it appears that the taking of individual witnesses evidence has been a continuous process in the sense that a witness has been questioned by Counsel assisting the Commission, then questioned in a manner somewhat equivalent to re-examination by Mr Hartnell and then permitted to depart, subject to the requirement that he return if he is to give further evidence. It would also appear that the questioning of individual witnesses has rarely, if at all, spread from one day into the next with the result that transcript could not have been available in any event. Such a situation occurs not infrequently in ordinary curial proceedings: in such circumstances, of course, Counsel appearing must make do with the notes which he himself has taken of the witnesses' evidence, subject, on rare occasions, to his making a successful application on very special grounds for an adjournment until the transcript becomes available.

40. It is clear that in the hearing before the Commission Mr Hartnell and his assistant have, indeed, done the best they can by way of taking notes of the evidence of witnesses in the ordinary way. It would appear that, on the basis of such notes, the re-examination of witnesses by them has taken place. I do not have before me any indication as to a desire on their part to recall for further questioning any particular witness. As I understand their position, it is that they have experienced difficulty in the taking of adequate notes, largely because of the complex and technical nature of the evidence, and they wish to have a proper transcript for the purpose of considering the evidence given by the individual witnesses, discussing the evidence at least with the individual witness who gave it for the purpose of determining the desirability or otherwise of seeking to supplement the evidence already given by the witness. It is also their desire to have such transcript available for the purpose of using it, in the ordinary way, for the formulation and presentation of submissions on behalf of their clients, should the necessity arise.

41. During these proceedings, I sought some indication as to whether the Commission had any present intention, the hearings apparently being nearly concluded, of providing transcript of the evidence or any part of it. The Commission's representative was unable to provide any precise information. Accordingly I can approach the determination of this aspect of the case only on the basis that the Commission adheres to its previously stated intentions that it will provide transcript of the evidence of each witness at a time which it deems appropriate. Such time, in these circumstances, could be after the conclusion of the hearings, with the result that it would not be available to the applicants' legal representatives for any of the purposes to which I have made reference above.

42. The question of provision of transcript, in the context of the Commission's being bound by the rules of natural justice was considered by the High Court of Australia in National Companies and Securities Commission v. News Corporation Limited [1984] HCA 29; (1984) 156 CLR 296.

43. In the first place, it is clear that due regard must be paid to the fact that the proceedings are part of an investigation being conducted by the Commission for some statutory purpose. Gibbs C.J. said (at p 309), "Where, however, the Commission decides to hold a hearing for the purpose of investigating whether a person has committed an offence ... there is no issue to be decided; the hearing is designed to discover facts which may or may not lead to further action being taken; no finding of fact or decision of law need be made; and the procedure is not an adversary one but inquisitorial."

44. The Court indicated that the character of the hearing as a component part of an investigative process had to borne in mind when determining what the requirements of natural justice would be in relation to procedures adopted at the hearing. The Court (Gibbs C.J. at p 311; Mason, Wilson, Dawson JJ. at p 320) approved the statement of Tucker L.J. in Russell v. Duke of Norfolk (1949) 1 All ER 109 at 118; "The requirements of natural justice must depend on the circumstances of the case, the nature of the enquiry, the rules under which the Tribunal is acting, the subject matter that is being dealt with and so forth."

45. The fact that the Commission when conducting the hearing sits in the role of inquisitor rather than adjudicator must, of course, have a bearing upon its obligation to release, even to highly reputable legal representatives of witnesses summoned before it, the transcript of a witnesses' evidence. The Commission is not trying a witness to determine whether he is guilty or not of an offence charged; it is not sitting as a magistrate in committal proceedings determining whether evidence proferred to it by a prosecutor is capable of establishing the guilt of persons charged; it is, itself, seeking to ascertain facts through an inquisitorial hearing in respect of which it is equipped with considerable powers of compulsion, not the least of which is that a witness cannot refuse to answer on the grounds of possible self-incrimination (s 39(5)).

46. Quite obviously, there may well be particular points in the course of an investigatory hearing where the Commission, as investigator, would reasonably deem it most inimical to the conduct of the investigation that a witness should have before him the precise record of what he said either on a previous occasion, or at an earlier point of time on the same occasion. Conflict in a witnesses' own testimony on some matter of importance can not infrequently indicate wilful falsehood and therefore be of assistance in determining whether a relevant offence may have been committed. It would be poor investigation, as, indeed, in curial proceedings, it would be poor cross-examination technique to remind the witness of what he said on the prior occasion by (inter alia) allowing him access to that information before putting to him the question or questions which might elicit a significant conflict in the testimony. A fortiori, it would be reasonably regarded as dangerous to release transcript of an earlier witnesses evidence where it was desired to ascertain whether the witness to be examined would give conflicting evidence on some significant point, at least in circumstances where the Commission would not wish to take the risk of the answers of the earlier witness shown in the transcipt becoming known to the witness to be examined. It is clear that, in a large percentage of cases, the Commission alone, with the help of Counsel assisting, can judge the desirability of the release of transcript. As Gibbs CJ. said in News Corporation (at p 136), "The Commission is entitled to consider that a hearing may be frustrated if all the information at its disposal is prematurely disclosed." Also, in the judgment of Mason, Wilson and Dawson JJ., it is said (at p 323), "It is of the very nature of an investigation that the investigator proceeds to gather relevant information from as wide a range of sources as possible without the suspect looking over his shoulder all the time to see how the enquiry is going. For an investigator to disclose his hand prematurely will not only alert the suspect to the progress of the investigation but may well close off other sources of enquiry."

47. Accordingly, I am satisfied that the Commission, in an investigative hearing, is quite entitled to withhold transcript of any witnesses' evidence where it is satisfied that the release of the transcript could carry with it a real not fanciful, risk of impeding the progress of the enquiry. This does not mean, however, that the Commission is entitled in all circumstances, and at any stage of an enquiry to withhold transcript until such time as it "deems it appropriate" to release it. It must not act capriciously. It must have regard to the reasonable needs of the witnesses summonsed before it and of their legal representatives. It must adopt fair procedures or it will not observe the rules of natural justice and will commit a breach of s 38(1)(b).

48. It is, of course, clear from the actual decision in News Corporation Limited that the rules of natural justice would be breached if the Commission refused entirely to provide a witness or his legal representative with a transcript of the witnesses' evidence. The decision, however, says nothing as to the point of time at which transcript must be provided. The question did not arise. Clearly that point of time will vary according to the circumstances of the case and the state of the investigation. In determining whether a request for transcript should be acceded to, the Commission would obviously take into account matters of the kind discussed above. It should also take into account that the statute expressly provides for legal representation of witnesses and that that right is not an empty one. It is clearly intended that the right to representation should be real and effective. It is clearly not intended that the legal representative's role should be confined to reminding the witness of his rights under s 39(5) of claiming an answer that he is required to give might tend to incriminate him. The News Corporation case makes it quite clear that a witness is entitled to have his legal representative re-examine him after he has been examined by the Commission or Counsel assisting it. It may be that, in many circumstances, such a re-examination can be performed without the assistance of transcript. In other circumstances it may well be that it plainly cannot be so conducted. The legal representative himself is in the best position to judge what his needs are in this regard. He will know whether he cannot properly assist his client without a copy of the transcript of the evidence and an opportunity to take instructions in a proper professional manner. This could be particularly so where the evidence is complex or technical and the legal representative needs assistance fully to understand it before seeking to deal with it in re-examination.

49. How does natural justice require that the Commission should approach a request made by a legal representative for the release to him of the transcript of his clients evidence when that request is made on the basis that it is needed in order to enable the representative to perform his appropriate role of re-examining his client in an effective and fully informed manner? In the News Corporation case Brennan J. said (at p 326) that, "It should be presumed that the Commission will not exceed its functions. It should be presumed that the Commission will use its hearing power not to obtain material for publication, but to inform itself in the exercise of its power to institute criminal or civil proceedings." In the same way, in my opinion, it should be presumed that the legal representative of a witness will not abuse his position when provided with transcript. It should be presumed that he will observe scrupulously the requirements, already discussed of professional ethics, that he will use the material only for the purpose of obtaining instructions from the witness in question, that he will warn the witness not to disclose the material to any other witness and that, should it be necessary for him to obtain instructions from some other source than the witness to enable him to conduct a proper and effective re-examination, he will obtain those instructions without disclosing the witnesses' evidence, at least in circumstances when there would be a risk of the evidence being made known to witnesses yet to be called or recalled.

50. It follows, in my view, that if a request for transcript is made by a legal representative in circumstances where it is reasonably possible to comply with that request and the request is made on the basis that it is needed by the legal representative to enable him properly to fulfill his role as the representative of the witness at the hearing, then that request, as a matter of natural justice, should be complied with unless there are compelling reasons related to the effectiveness and integrity of the enquiry which require that the request be refused at that point of time. If it be then refused, that refusal should be withdrawn when the need for it has passed.

51. What I have said in relation to the provision of transcript to enable a proper re-examination to take place applies equally to its provision, upon reasonable request, to enable the legal representative to make proper, useful, and properly informed submissions on his client's behalf should it become appropriate for such submissions to be made.

52. I must assume that in the present proceedings all material has been placed before me by the applicants and by the Commission bearing upon the question whether the transcript of the applicants' evidence should now be released to Mr Hartnell as the legal representative of each of them. I do not understand that any submission has been made that it should be released to the applicants themselves. In any event the evidence would not satisfy me that, at this stage, such an order should be made. However, I am satisfied that natural justice requires that the transcript of the evidence of all witnesses for whom he appears should now be released to Mr Hartnell, it being fully understood that he will ensure that no contempt is committed nor any breach of proper professional practice or ethics. Whether this last mentioned matter can be dealt with on the basis that it simply goes without saying or whether some appropriate undertaking would be sought or offered has not been canvassed before me and I would propose, at this stage, to leave it to the parties to consider this aspect of the matter when bringing in short minutes of orders based upon these reasons.

53. The remaining area of complaint relates to the applicants' claim that they should be entitled to call any necessary evidence and make any desired submissions in the event that the Commission is minded to make any adverse findings, comments or recommendations about them. I am not entirely sure that there is any real contention between the parties in this area. There may be something more in the nature of a misunderstanding. The requirements of natural justice in the situation where the Commission is contemplating the publication of adverse findings or comments about the applicants or any of them or, indeed, their employer companies is, in my respectful view, made quite clear by the judgments in News Corporation Limited. In those proceedings the Commission itself had suggested a particular procedure to be followed. Gibbs CJ. (at p 315) indicated that if any finding or report was to be made by the Commission, the requirements of natural justice would be "satisfied by the procedure which the Commission has suggested, namely, that if, at the conclusion of the hearing, the Commission proposes to publish any matter adverse to or critical of any person it will afford him or it an opportunity to be heard and call evidence on such matter before proceeding further". In further elaboration of this matter, his Honour said (at p 316), "When the Commission said that it would give the respondents an opportunity to be heard, it must have meant a proper opportunity, and there is no reason to think that the Commission will not give to the respondents adequate notice of any adverse conclusion which it has tentatively reached, or any criticism which it tentatively proposes to make, or that it will not listen with an open mind to whatever material is then put before it by the respondents and give full weight to such material. Having regard to the nature of the hearing, it seems to me that what the Commission has proposed is all that fairness requires."

54. I do not find anything in the other judgments in the case which runs counter to these propositions.

55. In the present case, this general question was raised by Mr Hartnell before the Commission on the 12th December, 1988. The Chairman responded as follows; "I will simply say that if it is proposed to recommend that a person be prosecuted under s 130 of the Futures Industry (New South Wales) Code then the Commission will afford that person an opportunity to make submissions to it before any recommendation is made." That statement was made in the context that Counsel assisting the Commission had said to the Commission in relation to Mr Hartnell's submission that "It has been the custom of the Commission in at least my experience that before steps are taken, for example to recommend that there be a prosecution, that the Commission afford the person the subject of such recommendation or likely recommendation an opportunity to make further submissions, to put material before the Commission, to try and influence the decision or have a bearing on the decision. In accordance with that custom I suppose the Commission might act in the way that it has been requested to act."

56. In the proceedings before me the representative for the Commission has stated that it abides by what was said in the early proceedings. The statement is perhaps ambiguous. It is certainly not clear to me whether the Commission has in fact indicated that it proposes only to allow submissions and not the calling of further evidence. I am rather of the view that the intention at all stages was to adopt the submission of Counsel assisting and permit the calling of evidence as well as the making of submissions. However, the situation has not been made clear in the present proceedings. Accordingly I state that it is my clear view that, if the Commission is of the opinion that it is likely, on the material before it, that it will recommend prosecution of any person or persons, natural justice will require that it should accord to that person or persons the opportunity not only to make submissions against the taking of that course but also to call such relevant evidence as he or they may wish to put before it.

57. I therefore propose to make orders in accordance with these reasons setting aside the non-disclosure orders made by the respondent, directing the provision of transcript to the applicants' legal representative and directing that opportunity be given to the applicants or any of them, if requested, to call further relevant evidence if the respondent is likely to recommend prosecution. I propose to order that the respondent pay the applicants' costs of this application.

58. I stand the proceedings over until 9.30am on Tuesday 7th March 1989 so the parties may bring in short minutes in accordance with these reasons.