Jorgensen v Australian Securities & Investments Commission [2004] FCA 143 (27 February 2004)

ADMINISTRATIVE LAW – freedom of information – investigation by Australian Securities and Investments Commission into affairs of applicant and associated company – applicant sought access under Freedom of Information Act 1982 (Cth) to documents relating to investigation – Commission refused access to certain documents – application to Administrative Appeals Tribunal for review of Commission decision – Commission claimed documents exempt from disclosure under Act – Tribunal held applicant could access documents Commission prepared to release to him – appeal from decision of Tribunal – whether Tribunal erred in applying exemption provisions of Act – whether Tribunal failed to give effect to aims and philosophy of Act

FREEDOM OF INFORMATION – investigation by Australian Securities and Investments Commission into affairs of applicant and associated company – applicant sought access under Freedom of Information Act 1982 (Cth) to documents relating to investigation – Commission refused access to certain documents – application to Administrative Appeals Tribunal for review of Commission decision – Commission claimed documents exempt from disclosure under Act – Tribunal held applicant could access documents Commission prepared to release to him – appeal from decision of Tribunal – whether Tribunal erred in its interpretation and application of ss 37(1)(b), 37(2)(b), 40(1)(c), 40(1)(d), 41, 42 and 45 of the Act – whether Tribunal failed to give effect to aims and philosophy of Act

Administrative Appeals Tribunal Act 1975 (Cth) s 44
Australian Securities and Investments Commission Act 2001 (Cth) ss 13, 30, 33, 127
Freedom of Information Act 1982 (Cth) ss 3, 11(1), 12(1)(b), 32, 37(1)(b), 37(2)(b), 37(2A), 40(1)(c), 40(1)(d), 40(2), 41, 42, 45, 61

Searle Australia Pty Ltd v Public Interest Advocacy Centre (1992) 36 FCR 111 considered
Department of Health v Jephcott (1985) 8 FCR 85 considered
Dale v Australian Federal Police (1997) 47 ALD 417 considered
Re Anderson & Australian Federal Police (1986) 11 ALD 355 referred to
Re Mickelberg & Australian Federal Police (1984) 6 ALN N176 considered
Esso Australia Resources Limited v Commissioner of Taxation of the Commonwealth of Australia [1999] HCA 67; (1999) 201 CLR 49 referred to
Blackwood Hodge (Aust) Pty Ltd v Collector of Customs (NSW) (1980) 47 FLR 131 referred to
Politis v Federal Commissioner of Taxation (1988) 16 ALD 707 referred to
Federal Commissioner of Taxation v Swift (1989) 18 ALD 679 referred to
Repatriation Commission v Smith (1987) 15 FCR 327 at 335 referred to
Australian Broadcasting Tribunal v Bond [1990] HCA 33; (1990) 170 CLR 321 at 355-7 referred to
Minister for Immigration and Multicultural Affairs v Epeabaka [1999] FCA 1; (1999) 84 FCR 411 referred to
The News Corporation Ltd v National Companies and Securities Commission (1984) 1 FCR 64 at 66 considered
Arnold v Queensland (1987) 73 ALR 607 at 617 considered
Johnson Tiles Pty Ltd v Esso Australia Ltd (No 3) [2000] FCA 495; 98 FCR 311 at [26] referred to
Re Munsie & Director-General of Social Security (1983) 5 ALD 189 referred to
Re Letts & Director-General of Social Security (1984) 6 ALN N176 referred to
Re Said & Commissioner of the Australian Federal Police (1983) 6 ALN N14 referred to
Re Chandra & Minister for Immigration and Ethnic Affairs (1984) 6 ALN N257 referred to
Re James & Australian National University (1984) 6 ALD 687 referred to
Department of Social Security v Dyrenfurth (1988) 80 ALR 533 referred to
Re Murtagh & Federal Commissioner of Taxation (1984) 54 ALR 313 referred to
Re Z & Australian Taxation Office (1984) 6 ALD 673 referred to
Harris v Australian Broadcasting Corporation (1983) 50 ALR 551 referred to
Re Boehm & Commonwealth Ombudsman (1985) 8 ALN N29 referred to
Corrs Pavey Whiting & Byrne v Collector of Customs (Vic) (1987) 14 FCR 434 considered
Coco v A N Clark (Engineers) Ltd (1968) 1A IPR 587 referred to
Saltman Engineering Co Ltd v Campbell Engineering Co Ltd [1963] 3 All ER 413 referred to

S Zifcak & M Paterson, Australian Administrative Law: Commentary Legislation, Service 127, Butterworths, October 2003.

ALAN BRADLEY JORGENSEN v AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION

V437 of 2003

WEINBERG J
27 FEBRUARY 2004
MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V437 OF 2003

BETWEEN:	ALAN BRADLEY JORGENSEN APPLICANT
AND:	AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION RESPONDENT
JUDGE:	WEINBERG J
DATE OF ORDER:	27 FEBRUARY 2004
WHERE MADE:	MELBOURNE

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

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V437 OF 2003

BETWEEN:	ALAN BRADLEY JORGENSEN APPLICANT
AND:	AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION RESPONDENT

JUDGE:	WEINBERG J
DATE:	27 FEBRUARY 2004
PLACE:	MELBOURNE

1 This is an appeal under s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) ("the AAT Act") from a decision of the Administrative Appeals Tribunal ("the Tribunal") given on 9 May 2003. By that decision, the Tribunal varied an earlier decision made by the Australian Securities and Investments Commission ("ASIC") relating to an application made by the applicant for access to certain documents under the Freedom of Information Act 1982 (Cth) ("the FOI Act"). The effect of the Tribunal’s decision was that the applicant could see a number of the documents that he had been seeking, but only those that ASIC was now prepared to make available to him. In essence, the applicant achieved only a pyrrhic victory before the Tribunal. He now contends that he should be given access to the remainder of the documents.

2 Some time prior to 1996, ASIC investigated the applicant and a number of his associated companies for alleged contraventions of the Corporations Law. At the relevant time, the applicant was involved in the control and management of a group of companies known variously as "the Lawrenson Group" or "the Townsend and Parker Group". That investigation resulted in the applicant being banned from holding the position of a director of a company for a period of three years.

3 On 9 July 1999, the applicant wrote to ASIC’s Victorian Regional Commissioner to complain about the conduct of certain ASIC staff in relation to the investigation. In accordance with its standard policy, ASIC arranged to have a Regional Commissioner from another State investigate the complaint. That task was given to the then Acting Regional Commissioner of ASIC’s Tasmanian Regional Office. After a lengthy investigation, he prepared a report titled "Report of ASIC Internal Inquiry into Complaint by Alan Jorgensen" ("the Report"). Part 1 of the Report, dated 9 March 2000, dealt with a complaint by the applicant that the original investigator had abused his position, and a further complaint that the proceedings taken against the applicant had been brought for an improper purpose. Part 2 of the Report, dated 11 April 2000, dealt with a complaint by the applicant concerning the entry onto ASIC’s Register of Disqualified Directors ("the Register") of a former director of a company of which the applicant had been an officer, and a further complaint concerning the appointment of a Receiver and Manager to that company.

4 The Report absolved all members of ASIC’s staff who had been involved in the investigation, and also concluded that there had been no impropriety regarding the entry of the name of the disqualified director onto the Register.

5 The applicant complained to the Commonwealth Ombudsman about the manner in which the Acting Regional Commissioner had undertaken his task. By letter dated 29 June 2001, the Ombudsman advised the applicant that, in his view, the internal investigation had been conducted properly. Accordingly, the Ombudsman affirmed the findings of that investigation.

6 On 31 July 2001, and 23 August 2001, the applicant made two separate requests under the FOI Act for access to documents relating to the Report. On 6 September 2001, he made a third request, under that Act, for access to:

7 On 7 December 2001, ASIC granted the applicant access to a number of the documents sought, or parts of them, and refused access to the remainder. On 10 December 2001, the applicant sought internal review of that decision. On 31 May 2002, an Authorised Review Officer of ASIC completed the review, and affirmed the decision taken on 7 December 2001, save that access was granted to six additional documents. On 31 July 2002, the applicant lodged an application with the Tribunal for review of that decision.

8 The Tribunal began by summarising the evidence placed before it. In an affidavit sworn on 20 December 2002, Mr Ronald Ladlay, ASIC’s Regional Commissioner in the Australian Capital Territory, and its National Advisor to the ASIC Enforcement Directorate, outlined his responsibilities. These included the supervision and undertaking of investigations of serious complaints against ASIC enforcement staff.

9 Mr Ladlay said that it was ASIC’s policy that when an internal investigation into its staff was conducted, it was done in the strictest of confidence and on the understanding that any information provided was confidential, as was the source of that information. He said that records relating to allegations of staff misconduct were kept separate from the personal files of the employees concerned. A separate file was opened, whether it be a misconduct file, or an investigation file. Such files were classified as "Z" files. During 1999, "Z" files had a security classification of "Staff-In-Confidence". That classification ensured that access to the files was restricted to persons who had a "need to know". Moreover, the relevant policy dictated that the physical "Z" file had to be stored in a key locking cabinet when not in use. It was the practice of ASIC Regional Commissioners to keep a "Z" file in a safe.

10 Mr Ladlay said that he believed that if such matters were not conducted in confidence, or the source of that information was not kept confidential, staff would be "reticent to be forthright" in their responses in such internal investigations. He also said that ASIC’s organisational structure was such that many tasks were delegated. In order to provide for its efficient operation staff had to be able to disclose fully and frankly, and in confidence, opinions and comments when required to do so. He expressed the view that if confidentiality were not maintained, the flow of such information would be diminished as staff focussed upon the need, or perceived need, to protect themselves and their colleagues from backlash. Accordingly, morale would suffer, and efficiency would be reduced.

11 Mr Ladlay went on to say that ASIC’s role as an investigative body would be damaged if it were required to disclose the identities of those involved in investigations, whether internal or external. There would also be harm done if the nature of their involvement were revealed as this "would allow the piecing together of the matrix as to the way in which ASIC goes about its business".

12 On the question of confidentiality, Mr Ladlay said that the documents relevant to this application encompassed material gathered by ASIC during the course of an investigation conducted under s 13 of the Australian Securities and Investments Commission Act 2001 (Cth) ("the ASIC Act"). He said that one of the most important aspects of any ASIC investigation was the issue of confidentiality. Section 127 of the ASIC Act required ASIC officers to keep confidential, at all times, information given to ASIC in connection with the performance of its functions unless authorised use or disclosure permitted otherwise. He said that the material acquired will often contain personal or commercially sensitive information not generally available to the public. If ASIC were not able to conduct its investigations within a confidential framework, the flow of information would diminish or cease. Moreover, those who were the subject of investigation, or possible investigation, could acquire information that might thwart any such investigation.

13 Mr Ladlay said that documents obtained pursuant to a notice under s 30 or s 33 of the ASIC Act were confidential by reason of the operation of s 127. This protected the holders of documents who were compelled to produce them, and assisted ASIC in fulfilling its investigative functions. To release such documents in response to an application under the FOI Act would prejudice ASIC in the exercise of its functions and powers under Part 3 of the ASIC Act. Mr Ladlay concluded:

14 The Tribunal then set out the relevant provisions of the FOI Act. These included ss 12(1)(b), 37(1)(b), 37(2)(b), 40(1)(c), 40(1)(d), 40(2), 41(1), 42(1) and 45(1). It noted the object of that Act as set out in s 3, as being "to extend as far as possible the right of the Australian community to access to information in the possession of the Government of the Commonwealth". It also referred to various extrinsic materials upon which the applicant relied in support of his contention that ASIC had failed to provide him with access to documents to which he was lawfully entitled. It also noted the applicant’s oral submission that ASIC had failed to show that real harm, rather than mere embarrassment, would be caused by the release of documents for which exemption had been claimed. The applicant pointed out that proceedings against him had concluded more than three years ago, and submitted that it was difficult to see how releasing the documents now could possible cause harm to ASIC’s workings.

15 The Tribunal noted, in particular, the applicant’s submission that he should be provided with draft copies of the final version of the Report. That submission was based upon his suspicion that certain ASIC officers had played a malevolent role in the wording of the Report, and that he was entitled to ascertain both who they were, and what influence, if any, they had had upon that document.

16 The applicant also argued before the Tribunal that the various exemptions under the FOI Act that ASIC had relied upon were not relevantly available. For example, he challenged ASIC’s claim for exemption under s 37(1)(b), a provision relating to disclosure of documents affecting law enforcement and the protection of public safety in so far as it entitles ASIC to decline to produce documents that might disclose confidential sources of information. Likewise, he challenged ASIC’s claim for exemption under s 40, based upon the supposed adverse effect that disclosure would have on the proper and efficient conduct of its operations. He complained of ASIC’s reliance upon s 41, which is designed to exempt from disclosure documents that affect personal privacy. He argued, in relation to s 42, that ASIC had adopted altogether too broad a view of the protection given to documents subject to legal professional privilege. Finally, he complained of ASIC’s invocation of s 45, dealing with documents containing material obtained in confidence, on the basis that nothing suggested that the release of such documents would found an action, by a person other than the Commonwealth, for breach of confidence.

17 The Tribunal then summarised the contentions advanced by Mr Rose SC who appeared on behalf of ASIC, and also appeared in the application before me. The Tribunal noted that Mr Rose claimed that initially 768 documents had been in dispute, of which 363 were subsequently released to the applicant, either whole or in part. There were 45 documents exempt under s 12(1)(b) that were available to the applicant on payment of the statutory fee. That meant that he had access to 408 documents, including a significant component of the final version of the Report. Mr Rose also referred to the Ombudsman’s investigation and report, and submitted that the applicant should not be permitted to conduct a "fishing expedition" to revisit issues that had already been determined against him on a number of occasions.

18 The Tribunal next summarised Mr Rose’s submissions, under the specific heads of exemption claimed in relation to each class of document. It noted his submission that, viewed individually, a number of the documents might seem innocuous. However, each document was said to be part of a "mosaic"; that is they helped to build up a picture, when viewed globally, of the manner in which ASIC conducted investigations, and dealt with allegations of misconduct against its staff. Therefore, the release of even one document would provide the applicant with an insight into the way in which it performed its legislatively mandated duties. It would also affect the relationship that had to be fostered between ASIC and third parties whereby information provided in confidence was protected.

19 After considering the competing submissions, and examining for itself a number of the disputed documents, the Tribunal made the following general comments:

20 The Tribunal then turned to each of the specific categories for which exemption was claimed. It said:

21 The reference to "Searle" in the Tribunal’s reasons at [54] was a reference to the judgment of the Full Court in Searle Australia Pty Ltd v Public Interest Advocacy Centre (1992) 36 FCR 111. In that case, it was held that there was no principle that the Court should "lean" in favour of disclosure of documents when interpreting the FOI Act. While the provisions of s 3 might assist in resolving any ambiguities in the legislation, they could not prevail over words plainly expressed.

22 There was then appended to the Tribunal’s reasons a detailed schedule setting out the statutory basis upon which each document was found to be exempt. A number of documents were found to be exempt under more than one category.

23 The applicant represented himself in the hearing before this Court. His submissions were somewhat discursive, and sometimes difficult to follow. Nonetheless, as I understood those submissions, he presented essentially the same case as he had before the Tribunal.

24 The applicant submitted that the Tribunal had failed to give effect to the aims, and philosophy, of the FOI Act. The underlying rationale of that Act was "open and accountable government", and it should therefore be interpreted in such a way as to promote that objective.

25 The applicant began by noting that, in January 1996, ASIC commenced an investigation into his affairs. In November 1998, it banned him from acting as a company director for three years. Subsequently, in December 2000, he pleaded guilty, in the Victorian County Court, to several charges under ss 232(6) and 1317FA of the Corporations Law. The proceedings related to allegations that the applicant had made improper use of his position as an officer of Townsend and Parker Pty Ltd (Riton Holdings Pty Ltd (in liq)) (ACN 069 470 891) and of Lawrenson Metal Casting Pty Ltd (formerly Townsend and Parker Holdings Pty Ltd (ACN 070 242 189), and also that he had falsely claimed to be Mr Paul Brodie, who was in fact his brother-in-law and a director of those companies, in order to gain a financial advantage. On 15 December 2000, he was sentenced to a term of 18 months’ imprisonment. That term was wholly suspended.

26 In July 1999, the applicant wrote to the Victorian Regional Commissioner of ASIC to complain about the conduct of ASIC’s staff in relation to its investigation into his affairs. ASIC undertook an internal investigation into the applicant’s complaints and, as noted earlier, Mr Simon Dwyer, the Acting Regional Commissioner for Tasmania, carried out that investigation. Mr Dwyer prepared the Report, which was in two parts. Part one dealt with the applicant’s complaint that ASIC’s original investigator, a Mr Cook, had abused his office, and taken enforcement action for an improper purpose. Part two dealt with the complaint regarding Mr Brodie’s name having been put on to the Register. In substance, the applicant contended that ASIC had acted precipitously in including Mr Brodie’s name on the Register. Had ASIC acted appropriately, and delayed including that name on the Register, the applicant would have been able to avoid having the HSBC Bank appoint a Receiver and Manager to his business, thereby salvaging it.

27 As previously noted, Mr Dwyer cleared Mr Cook of any impropriety in the conduct of the investigation into the applicant’s affairs. He also concluded that there had been no impropriety by any member of ASIC’s staff in entering Mr Brodie’s name onto the Register.

28 As also previously noted, the applicant then complained to the Commonwealth Ombudsman about the Report. On 29 June 2001, the Ombudsman advised the applicant that he had rejected his complaints. There then followed the applicant’s various requests under the FOI Act, their rejection, at least in part, and the applicant’s challenge to that decision in the Tribunal.

29 The applicant explained, from the bar table, that at the time he committed the offences to which he pleaded guilty in the County Court, his brother-in-law, Mr Brodie, was living in Townsville. He was a director and shareholder of the applicant’s companies. The applicant explained that by notice dated 13 August 1998, ASIC had asked Mr Brodie to show cause why he should not be prohibited from being a director, or from taking part in the management of a company. That followed an investigation into his conduct as a director.

30 On 11 June 1999, ASIC banned Mr Brodie from acting as a director for a period of two years and two months from 12 May 1999, the date on which he was served with a notice of prohibition. It was some twenty-eight days after that date that ASIC entered Mr Brodie’s name onto the Register.

31 Mr Brodie sought review of the decision to ban him, and also a stay of that decision. The applicant complained that ASIC told Mr Brodie that his name would not be entered on the Register until at least 7 July 1999, being the last date on which he could seek review. Notwithstanding that assurance, Mr Brodie’s name was put on the Register in June.

32 It should be noted that neither Mr Dwyer, nor the Ombudsman accepted the applicant’s claim that Mr Brodie had been given any such assurance.

33 The applicant said that, at the time, he was in the process of changing his companies’ banking arrangements from the HSBC Bank to Westpac. The manager of the particular branch of Westpac with whom he was dealing expressed a desire to meet Mr Brodie in order to obtain a clearer picture of those companies’ objectives. It was in those circumstances, and in particular in the context of a heated and very public dispute that the applicant was having with a trade union, and a Member of Parliament allegedly acting at that union’s behest, that the applicant sought to conceal from the manager his involvement with those companies. He therefore pretended to be Mr Brodie when he met the bank manager. The applicant claimed that Mr Brodie had, at all times, been fully aware of what he was doing, and that Mr Brodie had freely and voluntarily signed and executed all relevant documents.

34 The applicant then explained in still more detail why he believed that ASIC had conducted an investigation into his affairs. The theory was essentially that there had been a conspiracy on the part of certain ASIC officers to cause him harm. He alleged that they had gone to the HSBC Bank on a number of occasions, and that they had arranged for certain documents on the ASIC database to be backdated in order to deceive the bank into thinking that Mr Brodie had been acting as a director after he had been banned. This, in turn, led the bank to "pull the plug" on the applicant’s companies. To make matters worse, this was at a time that both ASIC, and the HSBC Bank were aware that the applicant was about to acquire a large company in Adelaide, ostensibly now worth $100 million.

35 The applicant then turned to his notice of appeal. By that notice, he simply asserted that the Tribunal had erred in its interpretation and application of the following sections of the FOI Act: ss 37(1)(b), 37(2)(b), 40(1)(c), 40(1)(d), 41, 42 and 45.

36 In his oral submissions, the applicant contended that the Tribunal had "totally ignored" the FOI Act. When asked specifically what error or errors he submitted that the Tribunal had made in dealing with, for example, s 37(1)(b), he replied that this provision could not have been intended to apply to cases such as his own. He submitted that anyone who had had a complaint made against them to a body like ASIC was entitled to know the identity of the complainant, and the substance of the complaint. He submitted that s 37(1)(b) was of limited application, and could only be invoked to protect the identity of persons who were under police protection, as recognised police informers.

37 In support of that submission, the applicant relied primarily upon a document apparently issued by the Attorney-General’s Department regarding the operation of the FOI Act, and published on that Department’s website. That document contains a set of guidelines to the interpretation of that Act. It characterises s 37(1)(b) as applying to documents "the disclosure of which would, or could reasonably be expected to affect the enforcement of a law for the protection of public safety", inter alia, by revealing the existence of a confidential informant. It suggests that in order for this exemption to apply, the document should have a connection with the criminal law, or the processes of upholding or enforcing civil law. The guidelines make specific reference to s 37(2A) which provides that, for the purposes of s 37(1)(b), a person "is taken to be" a confidential source of information in relation to the enforcement or administration of the law if the person is receiving or has received police protection under a witness protection program.

38 The applicant submitted that as those persons whose identities ASIC sought to protect under s 37(1)(b) were not receiving protection under any witness protection program, it could not rely upon the exemption contained in that section at all. In other words, he claimed that s 37(2A) prevented any reliance upon s 37(1)(b). The Tribunal, however, had granted exemption for a number of documents in part at least upon that provision. To that extent, the Tribunal had erred in law.

39 The applicant next turned to the Tribunal’s finding that s 37(2)(b) rendered a number of the documents exempt. That section provides that a document is exempt if its disclosure would or could reasonably be expected to disclose lawful methods or procedures for preventing, detecting, investigating or dealing with breaches of the law, the disclosure of which would be reasonably likely to prejudice the effectiveness of those methods or procedures. He submitted that the Tribunal had erred in adopting an unduly wide interpretation of this provision. He further submitted that the Tribunal had erred in requiring him to demonstrate that the exemption did not apply, rather than requiring ASIC to demonstrate that it did.

40 The applicant submitted that the provisions of the FOI Act that provided access to documents should be accorded the widest possible interpretation in order to achieve the aims and objectives of that Act. He submitted that Parliament could hardly have intended to allow government departments to withhold documents that merely caused embarrassment, under the aegis of a provision such as s 37(2)(b). He argued that the section only applied where the release of the documents might significantly prejudice law enforcement. He distinguished between the activities of mere regulatory bodies such as ASIC, and genuine law enforcement bodies such as the police. He also distinguished between the investigation of "serious" crimes, and mere violations of the Corporations Law.

41 The applicant then turned to the exemption granted under ss 40(1)(c) and (d). These provisions exempt documents the disclosure of which would, or could reasonably be expected to, have a substantial adverse effect on the management or assessment of personnel, or a substantial adverse effect on the proper and efficient conduct of the operations of an agency. By virtue of s 40(2), s 40(1) does not, however, apply to a document in respect of matter the disclosure of which under the FOI Act would, on balance, be in the public interest.

42 The Tribunal concluded that because a number of the documents contained the names or personal details of staff members who had been interviewed, the release of this information would severely hinder ASIC’s operations. The applicant submitted that the Tribunal erred in failing to appreciate that the onus rested upon ASIC to justify an exemption on these grounds. He contended that the Tribunal had simply glossed over the paucity of material to support its findings regarding these provisions, and effectively reversed the onus of proof. He posed the rhetorical question, how could it be in the public interest for ASIC to spend huge amount of money protecting innocuous documents?

43 The applicant next turned to s 41. That section provides that a document is exempt if its disclosure under the FOI Act would involve the unreasonable disclosure of personal information about any person. The aim of the section is to protect personal privacy. The Tribunal invoked this section to exempt from disclosure the private telephone numbers, and home addresses, of ASIC staff. As I understood the applicant’s submissions, he did not challenge that part of the Tribunal’s reasons.

44 Section 41 was only invoked in relation to a handful of documents. One of those documents was provided to me so that I could assess for myself whether the privacy concerns expressed by ASIC were reasonable. I shall return to this matter later in these reasons for judgment.

45 The next provision under which ASIC claimed exemption was s 42. That section provides that a document is exempt if it is of such a nature that it would be privileged from production in legal proceedings on the ground of legal professional privilege. Once again, the applicant sought to rely upon the guidelines prepared by the Attorney-General’s Department, and in particular, upon the broad statement of aims and objectives underlying the FOI Act. He was not able to point to any specific error on the part of the Tribunal in relation to its application of this section.

46 The final provision that ASIC had relied upon was s 45. Section 45(1) provides that a document is exempt if its disclosure under the FOI Act would found an action, by a person other than the Commonwealth, for breach of confidence. The section does not apply to certain classes of document that are specifically set out in s 45(2). The applicant referred to the Attorney-General’s Department’s guidelines, and in particular, the five separate criteria identified therein as rendering s 45(1) applicable. He submitted that these criteria could not conceivably have been met, particularly since most of the people who had provided information to ASIC had been required by statute to do so.

47 Mr Rose submitted that the Tribunal, having examined for itself the various documents in dispute, had dealt correctly with each of the statutory exemptions that it had upheld. He complained about the form of the applicant’s notice of appeal, and in particular, the applicant’s failure to specify in that notice a number of the matters that he now sought to agitate in this Court. He also submitted that a number of the applicant’s contentions were misconceived, being merely challenges to findings of fact made by the Tribunal, and not raising questions of law.

48 In response to the applicant’s specific submissions, Mr Rose turned first to s 37(1)(b). He argued that this provision was not restricted by s 37(2A) in the way contended for by the applicant. He submitted that it was not correct to construe s 37(1)(b) as applicable only to those comparatively rare cases where persons who provided confidential information were receiving police protection. Rather, s 37(2A) had been inserted into the FOI Act in 1994 out of an abundance of caution, so as to ensure that anyone who was receiving such protection would be accepted as being a "confidential source of information", in relation to the enforcement or administration of the law.

49 Mr Rose referred to the decision of a Full Court of this Court in Department of Health v Jephcott (1985) 8 FCR 85 in support of that submission. In that case, the Court dealt with the construction of s 37(1)(b), and construed it in terms that were far wider than those embodied in s 37(2A). He submitted that subsection (2A) had been introduced essentially for the avoidance of doubt, though he accepted that there might have been other possible reasons for its enactment.

50 Mr Rose also referred to a decision of the Administrative Appeals Tribunal in Dale v Australian Federal Police (1997) 47 ALD 417. That case had simply applied Jephcott but, significantly, at a time when s 37(2A) had already been in existence for several years. There was no suggestion in the decision that the new provision operated to restrict the scope of s 37(1)(b) in the manner for which the applicant contended.

51 Mr Rose then turned to s 37(2)(b). He submitted that the Tribunal had correctly determined that a number of the documents were exempt because their disclosure under the FOI Act would, or could reasonably be expected to, disclose methods or procedures for preventing, detecting, or investigating breaches or evasions of the law. He further submitted that disclosure of the documents would reveal ASIC’s procedures for recording information, the nature of its databases, the identity of those with whom it consulted, and matters of that kind. He submitted that these pieces of information, seemingly innocuous when viewed in isolation, took on a different aspect when seen as parts of a mosaic: see generally Re Anderson & Australian Federal Police (1986) 11 ALD 355. Such disclosure would have a tendency to thwart or damage future investigations. He referred to Re Mickelberg & Australian Federal Police (1984) 6 ALN N176. In that case, the Tribunal observed that whilst an applicant may be able to deduce the nature of investigative techniques from everyday experience and other informal sources, it was another thing to require disclosure of documents that might give him or her confirmed and authoritative knowledge of them.

52 Mr Rose next turned to ss 40(1)(c) and (d). He relied upon the fact that the documents in question contained the names of ASIC staff members who had been interviewed as part of the internal investigation process. These individuals had been tacitly assured that what they said during the course of interviews would not be disclosed. Mr Ladlay said in his affidavit that it was ASIC policy that when an internal investigation into the behaviour of its staff was conducted it was done "in the strictest of confidence". He also said that it was "understood that the information provided" was "confidential as to the source of that information". I asked Mr Rose whether he was submitting that ASIC could immunise itself from the requirements of the FOI Act merely by giving assurances to staff that their comments would be kept confidential. He submitted that this could only be done if the assurances were "reasonable in the circumstances". He pointed out that Mr Ladlay had expanded on his affidavit during the course of the Tribunal hearing, and that his evidence that staff would be reluctant to be forthright in their responses to questioning if they knew that those responses could be made public had not been challenged.

53 Mr Rose noted that there was little, if any, dispute regarding the correctness of the Tribunal’s decision in relation to s 41. He was content to adopt the Tribunal’s reasons regarding that issue as his submission.

54 With regard to s 42, legal professional privilege, Mr Rose submitted that the Tribunal had correctly applied the relevant test which was that set out in Esso Australia Resources Limited v Commissioner of Taxation of the Commonwealth of Australia [1999] HCA 67; (1999) 201 CLR 49 ("Esso"). This was the "dominant purpose" test. The documents in question were brought into existence for the dominant purpose of giving or receiving legal advice, or for use in actual or anticipated litigation. ASIC lawyers, both internal and external, had prepared most of the documents. He also noted that there were very few instances where exemption was claimed on the basis of legal professional privilege alone. There was usually a separate statutory claim invoked as well.

55 Finally, Mr Rose submitted that the Tribunal had correctly determined that s 45 rendered a number of the documents exempt. He pointed to one document, by way of example, which contained information that was commercially sensitive to a company unrelated to the applicant, and that was capable of being protected by an action for breach of confidence. In relation to another document, the subject of a s 45 exemption, he submitted that it contained information about the conduct of another director that was confidential, and had been received by ASIC in circumstances which imported an obligation of confidence. Mr Rose submitted that s 45 should be regarded as supplementary to the statutory requirement contained in s 127 which might not, of itself, confer upon anyone a cause of action.

56 It is obviously difficult, in a case of this nature, to undertake the task of going through each document sought by the applicant, testing it against the particular exemption claimed, and considering whether or not the Tribunal erred in law in arriving at the conclusion that it did. The sheer breadth of the applicant’s request, dealing as it did with the manner in which an investigation had been conducted, and whether or not a director’s name had been rightly or wrongly entered at a particular time on the Register, led to some 768 documents totalling almost 3,000 pages being regarded as potentially relevant. The applicant’s request has been considered by ASIC, by the Ombudsman, and by the Tribunal. He now seeks to have this Court embark upon a similar exercise.

57 The jurisdiction of this Court in relation to appeals from the Tribunal is conferred by s 44 of the AAT Act. That jurisdiction is confined to addressing questions of law. It does not involve merits review, or any type of rehearing. A number of the applicant’s submissions suggest that he has failed to grasp that fundamental point.

58 It has been said repeatedly that the Court should exercise restraint when reviewing decisions of the Tribunal: Blackwood Hodge (Aust) Pty Ltd v Collector of Customs (NSW) (1980) 47 FLR 131; Politis v Federal Commissioner of Taxation (1988) 16 ALD 707; and Federal Commissioner of Taxation v Swift (1989) 18 ALD 679. Although the Court must intervene if an error of law is identified, questions of fact should not be inflated or magnified into questions of law. The fact that a Tribunal falls into error in a step in its process of reasoning does not mean that the decision must necessarily be set aside. See Repatriation Commission v Smith (1987) 15 FCR 327 at 335.

59 A finding of fact will only be open to challenge as erroneous in law if there is no probative evidence to support it: Australian Broadcasting Tribunal v Bond [1990] HCA 33; (1990) 170 CLR 321 at 355-7 per Mason CJ. In Minister for Immigration and Multicultural Affairs v Epeabaka [1999] FCA 1; (1999) 84 FCR 411 a Full Court held that want of logic in drawing an inference of fact does not of itself amount to an error of law. Cases of this type, of which there are many, demonstrate the limited nature of review of facts that can be undertaken under the rubric of an appeal on a question, or questions, of law.

60 As indicated earlier, I have not engaged in a detailed examination of every page of every document in dispute. To have done so would have taken literally weeks. I have instead examined a representative sample of the documents in question, chosen essentially at random, in order to gauge whether the Tribunal’s interpretation of the various provisions upon which it relied in upholding ASIC’s claims for exemption revealed some legal error. In the end, apart from one relatively minor matter, I have been unable to detect any such error.

61 A leading commentary on the FOI Act, namely that by S Zifcak and M Paterson in Ch 7 of Australian Administrative Law: Commentary Legislation, Butterworths ("Zifcak and Paterson"), observes that early in that Act’s operation, a number of cases suggested that its object, as set out in s 3, required the Tribunal and the Courts to construe provisions conferring rights of access broadly, and the exemption provisions narrowly. However, a Full Court of this Court rejected that approach in The News Corporation Ltd v National Companies and Securities Commission (1984) 1 FCR 64 at 66. The Court said:

62 In Arnold v Queensland (1987) 73 ALR 607 at 617, Wilcox J referred to s 3 as:

63 Section 11(1) creates a legally enforceable right of access to documents, other than exempt documents. The purpose for which a person wishes to obtain access to a document is of no relevance to that person’s right of access, and need not be disclosed as a basis for seeking such access: Johnson Tiles Pty Ltd v Esso Australia Ltd (No 3) [2000] FCA 495; 98 FCR 311 at [26].

64 Part IV of the FOI Act exempts certain categories of documents from access. Section 32 provides that a particular exemption provision should not be construed as being limited by any other exemption provision, or as not applying to a document, because another exemption does apply. Thus, the fact that one exemption applies to a document does not mean that others will not also apply. Similarly, the breadth of any particular exemption should not be read down because there is overlap with another.

65 Section 61 provides that where an agency has claimed an exemption with respect to documents, it is the agency, and not the applicant, which has the onus of proving that the decision to claim the exemption is justified. It seems that it must do so on the balance of probabilities. See generally Searle at 116.

66 Section 37(1)(b), upon which ASIC relied, is one of a number of provisions intended to exempt from production documents affecting the enforcement of the law, the protection of individuals concerned with it, and general public safety. Section 37(1)(b) protects the position of confidential informants in relation to the enforcement of the law. The section has been considered on a number of occasions: see for example Re Munsie & Director-General of Social Security (1983) 5 ALD 189; Re Letts & Director-General of Social Security (1984) 6 ALN N176; Re Said & Commissioner of the Australian Federal Police (1983) 6 ALN N14; and Re Chandra & Minister for Immigration and Ethnic Affairs (1984) 6 ALN N257. The persons whose identities were protected in those cases were informers of various kinds, but not, it should be emphasised, persons under police protection. The section was given a broad interpretation in Jephcott, where all that was required was that the source of information be "properly ... regarded as a confidential source", without any need to assess whether revealing that source would pose a risk to the enforcement or administration of the law.

67 Section 37(2A) provides that a person is taken to be a confidential source of information in relation to the enforcement or administration of the law if the person is receiving, or has received, protection under the auspices of a Commonwealth or State witness protection program. There is nothing to suggest, however, that the enactment of the section was intended to restrict the operation of s 37(1)(b). The expression "taken to be" does not connote an exhaustive definition, but rather one intended for the avoidance of doubt.

68 If there were any real doubt about this matter, it would be dispelled by reference to the Explanatory Memorandum prepared for the Law and Justice Legislation Amendment Bill 1994 by which s 37(2A) was enacted. That Memorandum spoke of the need to amend the FOI Act to:

69 This statement of the purpose underlying s 37(2A) is the very antithesis of the applicant’s submission, and effectively puts paid to it. Accordingly, I reject the applicant’s contention that the Tribunal erred in law in applying s 37(1)(b) to persons who did not fall within the ambit of s 37(2A).

70 Sections 40(1)(c) and (d) exempt from disclosure documents the release of which would have a "substantial adverse effect" on the relevant designated activity. The expression "substantial adverse effect" has been held to connote an effect that is "serious" or "significant": Re James & Australian National University (1984) 6 ALD 687. The effect must either arise from the disclosure of the particular information in the relevant documents, or from the disclosure of documents of a specific kind. The vice of such disclosure lies in the risk that there will be a cessation or diminution of the future flow of information if it is permitted: Department of Social Security v Dyrenfurth (1988) 80 ALR 533.

71 The Tribunal, in my view, did not err in law in deciding that the documents held to be exempt under ss 40(1)(c) and (d) fell within that description. It acted upon the unchallenged evidence of Mr Ladlay to that effect, and it therefore had a rational basis for arriving at that conclusion. It is not to the point that others might have accorded less weight to that evidence, and perhaps have arrived at a different conclusion.

72 Section 40(1)(c) deals with the potential effect of disclosure upon the management or assessment of personnel. It has been applied, in the past, to require the removal of officers’ names from documents to which access was granted: Re Murtagh & Federal Commissioner of Taxation (1984) 54 ALR 313 and Re Z & Australian Taxation Office (1984) 6 ALD 673. It is true that in Harris v Australian Broadcasting Corporation (1983) 50 ALR 551 it was held that embarrassment to officers which might arise from disclosure is insufficient to constitute "a substantial adverse effect". However, there is nothing in the Tribunal’s reasons, in the present case, to suggest that it proceeded on the basis that potential embarrassment alone would be sufficient.

73 Section 40(1)(d) deals with the "proper and efficient conduct" of agencies. It is concerned with the effect that the disclosure of documents will have on the manner in which an agency conducts its operations, and not with the contents of those documents per se. See for example Re Boehm & Commonwealth Ombudsman (1985) 8 ALN N29. In Searle, the Full Court held that this section was not limited to matters relating to the internal administration of the agency, such as a consultant’s report upon its operations, but extended to the way in which the agency discharged or performed any of its functions. Once again, I can discern no error on the part of the Tribunal in its interpretation of this section.

74 Section 41, which is concerned with personal affairs, barely rated a mention in the course of argument. The applicant accepted that matters such as the personal telephone number and home address of an individual named in a document fell squarely within this section. No error of any kind has been demonstrated.

75 Section 42 raises for consideration the doctrine of legal professional privilege. In Esso, the High Court held that the doctrine is available at common law where a document has been brought into existence for the dominant purpose of submission to legal advisers for advice, or for use in legal proceedings. There is nothing to suggest that the Tribunal misunderstood the scope of the doctrine, or failed to apply it correctly. Indeed, the documents to which I was taken by way of example plainly demonstrated that the Tribunal had determined the issue whether legal professional privilege applied in complete accordance with established doctrine.

76 Finally, s 45 raises for consideration whether the documents held to be exempt under that section, if disclosed would found an action, by a person other than the Commonwealth, for breach of confidence. The ambit of an earlier version of the section was considered by a Full Court of this Court in Corrs Pavey Whiting & Byrne v Collector of Customs (Vic) (1987) 14 FCR 434, where Jenkinson J, with whom Sweeney J agreed, observed that it required the Tribunal to ask two questions:

77 The applicant in the present case submitted that s 45 could only be invoked where the disclosure of a particular document would be actionable under the general law. In Searle, it was said at 126 that the words "a breach of confidence" in the former version of the section did not denote "actionable breach of confidence". The judgment turned upon the language of the section at the time. It is now tolerably clear that, in its present form, s 45 requires a finding that disclosure would give rise to an action for breach of confidence. I was initially sceptical as to whether the Tribunal had applied the section correctly. Its reasoning on this point was brief in the extreme, and there is nothing in the handful of documents that were found to be exempt under s 45 alone that establishes that their disclosure would found such an action. Having now considered the matter at greater length, and also having examined several of the documents said to fall within scope of the section, I am satisfied that the Tribunal erred in law in upholding the s 45 claims.

78 According to the schedule appended to the Tribunal’s reasons for decision, s 45 was invoked in relation to 151 separate documents. However, the vast majority of these documents were held to be exempt not merely by virtue of the operation of this section, but also by virtue of the operation of the other provisions to which I have referred. In total, there were only eight documents that were held to be exempt solely by virtue of s 45. They were documents 225 (pages 0644-0648), 248 (pages 0689-0691), 494 (page 1941), 495 (page 1942), 511 (page 1960), 513 (page 1966), 719 (pages 2664-2665), and 764 (pages 2844-2859).

79 An action for breach of confidence, in equity, requires proof of a number of elements. It is based upon the failure of a confidant to preserve the confidential character which has been communicated in circumstances giving rise to an obligation of confidence: Coco v A N Clark (Engineers) Ltd (1968) 1A IPR 587. The information must be of a confidential nature, in the sense that it is not something which is public knowledge: Saltman Engineering Co Ltd v Campbell Engineering Co Ltd [1963] 3 All ER 413.

80 Mr Ladlay’s affidavit says very little about the nature of the information contained in the documents in relation to which the s 45 exemption was said to apply. The onus rested upon ASIC to establish the facts that would support such a claim. In my opinion, it has not discharged that onus. It follows that the Tribunal erred in law in upholding ASIC’s claim for exemption in relation to the eight documents that were wholly dependent upon s 45. The applicant is entitled to access to those documents.

81 The applicant has been partially successful in his appeal to this Court. However, the measure of his success is small. He has gained access to only eight documents out of the hundreds that he was seeking. In my view, reflecting the measure of his success, the applicant should be required to pay eighty per cent of the respondent’s costs of and incidental to this appeal, such costs to be taxed in default of agreement.

I certify that the preceding eighty-one (81) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Weinberg.

Counsel for the Applicant:	Applicant appeared in person

Counsel for the Respondent:	Mr P N Rose SC and Mr G S Fountain-Smith

Solicitor for the Respondent:	Australian Securities and Investments Commission

Date of Hearing:	27 October 2003

Date of Judgment:	27 February 2004

1.	The appeal be allowed in part.
2.	The applicant be granted access to the documents that the Administrative Appeals Tribunal held were exempt solely under s 45 of the Freedom of Information Act 1982 (Cth). The documents to which this order applies are numbered, in accordance with the schedule to the reasons for decision given by the Administrative Appeals Tribunal on 9 May 2003, as follows:
•	document 225 (pages 0644-0648);
•	document 248 (pages 0689-0691);
•	document 494 (page 1941);
•	document 495 (page 1942);
•	document 511 (page 1960);
•	document 513 (page 1966);
•	document 719 (pages 2664-2665); and
•	document 764 (pages 2844-2859).
3.	The decision of the Administrative Appeals Tribunal be otherwise affirmed.
4.	The applicant pay eighty per cent of the respondent’s costs of and incidental to this appeal, such costs to be taxed in default of agreement.

Federal Court of Australia

Jorgensen v Australian Securities & Investments Commission [2004] FCA 143 (27 February 2004)