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Federal Court of Australia - Full Court |
Last Updated: 2 September 2009
FEDERAL COURT OF AUSTRALIA
Assistant Treasurer and Minister for Competition Policy and Consumer Affairs v Cathay Pacific Airways Limited [2009] FCAFC 105
ADMINISTRATIVE LAW -- voluntary
statement of reasons -- filed "to assist the parties" -- filing constitutes no
joinder of issue -- legal advice in minute
making recommendations -- no waiver
of privilege
PRACTICE AND PROCEDURE -- leave to appeal -- legal
professional privilege --statement of reasons -- statement as to effect of legal
advice -- waiver
Administrative Decisions (Judicial Review) Act
1977 (Cth) s 13, Sch 2(f)
Evidence Act 1995 (Cth) s
122(5)(a)(iii)
Federal Court of Australia Act 1976 (Cth) s
24(1A)
Judiciary Act 1903 (Cth) ss 55J, 55M
Trade Practices Act
1974 (Cth) ss 5(3), 5(4), 5(5)(a)
Federal Court Rules O 15 r 14, O
52 rr 2AA(a), 22(3)(a), O 54 r 3(1)
Ampolex Ltd v Perpetual Trustee Co
(Canberra) Ltd (1996) 40 NSWLR 12, applied
Ampolex Ltd v Perpetual
Trustee Co (Canberra) Ltd [1996] HCA 15; (1996) 137 ALR 28, cited
Areva NC
(Australia) Pty Ltd v Summit Resources (Australia) Pty Ltd (No 2) [2009]
WASC 67, cited
Attorney-General for the Northern Territory v Maurice
[1986] HCA 80; (1986) 161 CLR 475, applied
Australian Competition and Consumer
Commission v Cadbury Schweppes Pty Ltd [2009] FCAFC 32, 254 ALR 198,
applied
Australian Unity Health Ltd v Private Health Insurance
Administration Council [1999] FCA 1770, applied
Bailey v
Department of Land and Water Conservation [2009] NSWCA 100,
cited
Brilliant Digital Entertainment Pty Ltd v Universal Music Australia
Pty Ltd [2004] FCAFC 270, (2005) 63 IPR 373, cited
Commissioner of
Taxation v Rio Tinto Ltd [2006] FCAFC 86, 151 FCR 341,
applied
Commissioner of Taxation v Rio Tinto Ltd [2006] HCATrans 539,
cited
Curlex Manufacturing Pty Ltd v Carlingford Australia General
Insurance Limited [1987] 2 Qd R 335, cited
Decor Corp Pty Ltd v
Dart Industries Inc [1991] FCA 655; (1991) 33 FCR 397, applied
East Melbourne Group
Inc v Minister for Planning [2008] VSCA 217, 254 ALR 112,
cited
Financial Management Professionals Group Pty Ltd v Gray [2005]
FCA 1077, cited
GE Capital Corporate Finance Group Ltd v Bankers Trust Co
[1995] 1 WLR 172, cited
GEC Marconi Systems Pty Ltd v BHP Information
Technology Pty Ltd [2000] FCA 593, cited
Grant v Downs [1976] HCA 63; (1976) 135
CLR 674, cited
Grofam Pty Ltd v Australia and New Zealand Banking Group
Ltd (1993) 43 FCR 408, applied
Harding v Deputy Commissioner of
Taxation [2008] FCA 1516, 172 FCR 469, cited
Holmes v Deputy
Commissioner of Taxation (NSW) (1987) 19 ATR 1278, cited
Hongkong
Bank of Australia Ltd v Murphy [1993] 2 VR 419, cited
Jarrett v
Seymour (1993) 46 FCR 557, cited
Ly v Minister for Immigration
and Multicultural Affairs [2000] FCA 15, cited
Mann v Carnell
[1999] HCA 66; (1999) 201 CLR 1, applied
Merck & Co, Inc v Sankyo Co Ltd [1992] FCA 198; (1992)
23 IPR 415, cited
Minister for Immigration and Ethnic Affairs v Taveli
[1990] FCA 169; (1990) 23 FCR 162, cited
Re Minister for Immigration and Multicultural and
Indigenous Affairs; Ex parte Palme [2003] HCA 56, 216 CLR 212,
cited
New South Wales Council for Civil Liberties Inc v Classification
Review Board [2006] FCA 1409, 236 ALR 313, applied
Osland v Secretary,
Department of Justice [2008] HCA 37, 234 CLR 275, applied
Qu v
Minister for Immigration and Multicultural Affairs [2001] FCA 1299,
cited
R v The Australian Broadcasting Tribunal; Ex parte Hardiman
[1980] HCA 13; (1980) 144 CLR 13, cited
Telstra Corporation Ltd v AAPT Ltd (1997) 38
IPR 539, cited
Waterford v The Commonwealth of Australia [1987] HCA 25; (1987) 163
CLR 54, cited
Meltz D, "The Extraterritorial Operation of the Trade
Practices Act -- A Time for Reappraisal?" (1996) 4 TPLJ 185
Wright R,
"Aspects of the Extraterritorial Application of Sections 50 and 50A of the Trade
Practices Act" (1992) 20 ABLR 152
Australia, House of
Representatives, Debates (1977) Vol HR105, p 1394
Australia,
Parliament, Parliamentary and Government Publications: Prerogative Writ
Procedures -- Report of Committee of Review, Parl
Paper No 56
(1973)
ASSISTANT
TREASURER AND MINISTER FOR COMPETITION POLICY AND CONSUMER AFFAIRS v CATHAY
PACIFIC AIRWAYS LIMITED (ARBN 000 479 514) AND
ANOR
VID 206 OF 2009
SPENDER, LANDER
AND FLICK JJ
31 AUGUST 2009
MELBOURNE
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AND:
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AUSKAY INTERNATIONAL MANUFACTURING & TRADE PTY LTD
Second Respondent |
THE COURT ORDERS THAT:
1. Leave to appeal as sought in the Notice of Motion dated 1 April 2009 is granted. 2. The appeal is allowed. 3. The First Respondent is to pay the costs of the Applicant on the Motion.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal
Court Rules.
The text of orders can be located using eSearch on the
Court’s website.
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BETWEEN:
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AND:
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AUSKAY INTERNATIONAL MANUFACTURING & TRADE PTY LTD
Second Respondent |
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DATE:
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31 AUGUST 2009
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PLACE:
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MELBOURNE
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REASONS FOR JUDGMENT
SPENDER J:
1 I have had the benefit of reading in draft form the reasons for judgment of Flick J. I agree with those reasons and with the orders that his Honour proposes. 2 In particular, I agree that the mere reference in a statement of reasons to legal advice having been obtained and forming part of the decision-making process does not constitute a waiver of legal professional privilege in respect of that advice. 3 The statement of reasons in this case does not purport to state the advice from a Senior General Counsel employed by the Australian Government Solicitor to Treasury, or its substance and effect, and therefore does not amount to a disclosure of the advice, ie, what the advice is. It therefore does not constitute a waiver of legal professional privilege.
Associate:
Dated: 31 August 2009
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BETWEEN:
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AND:
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AUSKAY INTERNATIONAL MANUFACTURING & TRADE PTY LTD
Second Respondent |
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DATE:
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31 AUGUST 2009
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PLACE:
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MELBOURNE
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REASONS FOR JUDGMENT
LANDER J:
4 I agree with the reasons of Flick J and have nothing to add.
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I certify that the preceding one (1) numbered paragraph is a true copy of
the Reasons for Judgment herein of the Honourable Justice
Lander.
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Associate:
Dated: 31 August 2009
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IN THE FEDERAL COURT OF AUSTRALIA
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VICTORIA DISTRICT REGISTRY
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GENERAL DIVISION
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VID 206 OF 2009
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BETWEEN:
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AND:
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AUSKAY INTERNATIONAL MANUFACTURING & TRADE PTY LTD
Second Respondent |
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DATE:
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31 AUGUST 2009
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PLACE:
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REASONS FOR JUDGMENT
FLICK J:
Extended application of Parts IV, IVA, V, VB and VC (1) Part IV, Part IVA, Part V (other than Division 1AA), Part VB and Part VC extend to the engaging in conduct outside Australia by bodies corporate incorporated or carrying on business within Australia or by Australian citizens or persons ordinarily resident within Australia. (1A) In addition to the extended operation that section 46A has by virtue of subsection (1), that section extends to the engaging in conduct outside Australia by:
5 In a separate proceeding in this Court, Auskay International Manufacturing & Trade Pty Ltd has alleged that a number of airlines, including Cathay Pacific Airways Ltd, made and gave effect to price-fixing arrangements in relation to the provision of airfreight services, including the provision of fuel, security and war-risk surcharges, into and out of Australia. In that proceeding it is apparently alleged that there has been a contravention of s 45(2) of the Trade Practices Act 1974 (Cth) ("the 1974 Act"). Damages are sought pursuant to s 82 of that Act and other orders are sought pursuant to s 87 of the Act. 6 For the purposes of that proceeding, Auskay cannot rely upon conduct that has occurred outside of Australia in the absence of consent being granted pursuant to s 5 of the 1974 Act. On 2 December 2008 the present Applicant -- the Assistant Treasurer and Minister for Competition Policy and Consumer Affairs -- gave consents pursuant to ss 5(3) and 5(4). 7 Section 5 of the 1974 Act provides as follows:
(2) In addition to the extended operation that sections 47 and 48 have by virtue of subsection (1), those sections extend to the engaging in conduct outside Australia by any persons in relation to the supply by those persons of goods or services to persons within Australia. (3) Where a claim under section 82 is made in a proceeding, a person is not entitled to rely at a hearing in respect of that proceeding on conduct to which a provision of this Act extends by virtue of subsection (1) or (2) of this section except with the consent in writing of the Minister. (4) A person other than the Minister or the Commission is not entitled to make an application to the Court for an order under subsection 87(1) or (1A) in a proceeding in respect of conduct to which a provision of this Act extends by virtue of subsection (1) or (2) of this section except with the consent in writing of the Minister. (5) The Minister shall give a consent under subsection (3) or (4) in respect of a proceeding unless, in the opinion of the Minister:(a) New Zealand and New Zealand Crown corporations; or(b) bodies corporate carrying on business within New Zealand; or
(c) persons ordinarily resident within New Zealand.
(a) the law of the country in which the conduct concerned was engaged in required or specifically authorised the engaging in of the conduct; and(b) it is not in the national interest that the consent be given.
It will be noted that the Minister is to give consent unless he is of the opinion that "the law of the country in which the conduct concerned was engaged in required or specifically authorised the engaging in of the conduct" and where he is of the opinion "that it is not in the national interest that consent be given". The commercial context in which a Minister is called upon to make such a decision is one of accepted sensitivity. The difficulties created by legislation of the present kind having extraterritorial operation have been the subject of some academic analysis: Wright R, "Aspects of the Extraterritorial Application of Sections 50 and 50A of the Trade Practices Act" (1992) 20 ABLR 152; Meltz D, "The Extraterritorial Operation of the Trade Practices Act -- A Time for Reappraisal?" (1996) 4 TPLJ 185.
8 The present matter before this Court arises out of a separate proceeding commenced by Cathay Pacific in which judicial review is sought of the consents ostensibly given by the Assistant Treasurer in December 2008. That proceeding invokes the Administrative Decisions (Judicial Review) Act 1977 (Cth) ("the 1977 Act") and s 39B of the Judiciary Act 1903 (Cth) ("the 1903 Act"). Cathay Pacific contends that various errors of law were committed by the Assistant Treasurer when giving consent. 9 In order "to assist the parties", reasons were provided by the Minister for the decisions made. Those reasons were expressly provided without admission as to whether or not a statement of reasons could be ordered to be provided pursuant to s 13 of the 1977 Act. The provision of a statement of reasons pursuant to s 13, apparently, had previously been resisted upon the basis that there was no requirement to provide such a statement by reason of paragraph (f) of Schedule 2 to the 1977 Act. However that debate may ultimately have been resolved, it need not now be addressed. Reasons were voluntarily provided by way of a document dated 11 March 2009. That statement was preceded by a Treasury Executive Minute dated 21 November 2008 containing recommendations. The recommendation to grant consent was the one accepted by the Assistant Treasurer. 10 An expurgated version of the Treasury Executive Minute has been provided to Cathay Pacific. Legal professional privilege has been claimed by the Assistant Treasurer in respect to those portions of the Minute which have been deleted. 11 The judicial review proceeding is in the docket of His Honour Justice Middleton. In an ex tempore ruling delivered on 25 March 2009, His Honour ordered that there be provided to Cathay Pacific "an unredacted copy" of the Minute. 12 Now before this Court is both an application for leave to appeal from that order and, if leave is granted, the appeal itself. If leave is granted, the First Respondent seeks to rely upon a Notice of Contention dated 11 May 2009. 13 It is concluded that leave to appeal should be granted and the appeal allowed. The Notice of Contention is to be rejected.
THE REASONS PROVIDED AND THE TREASURY EXECUTIVE MINUTE
Findings on material questions of fact Was conduct specifically required or authorised by the laws of the relevant countries? [23] Advice provided by Auskay in relation to each jurisdiction was to the effect that in each jurisdiction, the alleged conduct was not authorised or required by the laws of any of the relevant countries. [24] The Airlines responded with submissions, but only three foreign legal advices (in respect of Japan, Singapore and Hong Kong) were provided. The effect of those advices was that certain air cargo tariffs and surcharges had been approved by local authorities in Japan, Singapore and Hong Kong. The effect of the Hong Kong advice was that these surcharges had been approved by local authorities on a collective basis. [25] Having had regard to all of the legal advices before me, and the conflict between those legal advices, I was not satisfied that all or any part of the alleged conduct was required or specifically authorised by the law of any of the countries the subject of the application for consent. [26] Further, I was not satisfied that the conduct which was said to be required or specifically authorised by the laws of Singapore, Japan and Hong Kong, in the advices provided by the Airlines, was the same as the alleged conduct, i.e. the concealed price fixing conduct described as the Global Cartel Arrangement in the Second Amended Statement of Claim. [27] Accordingly, I did not form the opinion that the relevant conduct was required or specifically authorised by the law of any of the relevant countries.
14 Given the terms of s 5(5)(a) of the 1974 Act, an issue necessarily addressed by the Assistant Treasurer in his statement of reasons was whether or not "the law of the country in which the conduct concerned was engaged in required or specifically authorised the engaging in of the conduct". 15 The statement of reasons thus refers to the fact that "legal advice from independent experts" was provided as to whether the overseas conduct was specifically authorised by the laws applicable in the overseas jurisdictions. The airlines whose conduct was in question made submissions and some provided independent legal advice. Cathay Pacific provided a letter from the Hong Kong Civil Aviation Department (CAD) stating in effect that "it was lawful in Hong Kong for any carrier to levy a surcharge ex-Hong Kong based upon a collective application specifically approved by CAD and that the relevant fuel surcharges were specifically approved by CAD". 16 The statement of reasons relevantly concluded that the Assistant Treasurer "was not satisfied ... that the law of any of the jurisdictions required or specifically authorised the alleged conduct". In reaching that conclusion, the statement of reasons records the following findings:
Indeed, given "the conflict between [the] legal advices", the "opinion" ultimately reached by the Assistant Treasurer may not seem surprising. Whether or not that "opinion" was reached in a legally permissible manner remains to be determined in the judicial review proceeding.
[32] In reaching the finding set out in paragraph 23 I had regard to the material before me, and based my finding particularly on the Treasury Executive Minute and the advices listed in Attachment 3. [33] In reaching the finding set out in paragraph 24 I had regard to the material before me, and based my finding particularly on the Treasury Executive Minute, and the material contained in Attachment 6 and Attachment 7(a)(i). [34] In reaching the finding set out in paragraph 25 I had regard to the material before me, and based my finding particularly on the Treasury Executive Minute, and the material contained in Attachments 3, 6, 7(a)(i), 7(b), 9, 11 and 12. [35] In reaching the finding set out in paragraph 26 I had regard to the material before me, and based my finding particularly on the material identified in the preceding paragraph. [36] In reaching the finding set out in paragraph 28 I had regard to the material before me, and based my finding particularly on the terms of section 5 of the Act and the Treasury Executive Minute. [37] In reaching the findings set out in paragraph 29 I had regard to the material before me, and based my findings particularly on the Treasury Executive Minute and the material contained in Attachments 3, 6, 7(a)(i), 7(b), 9, 11 and 12. [38] In reaching the findings set out in paragraph 30 I had regard to the material before me and I based my findings on the material identified in the preceding paragraph. [39] The finding set out in paragraph 31 was based on my findings on the material identified in paragraph 37.
17 In addition to these "findings", the Assistant Treasurer’s statement of reasons also set forth as follows the "evidence or other material on which findings were based":
THE CLAIMS FOR LEGAL PROFESSIONAL PRIVILEGE
The effect of the foreign law advices in these cases was that certain tariffs and surcharges had been approved by local authorities, even on a collective basis in one case.
18 The Treasury Executive Minute, to which express reference is made in the statement of reasons, was obviously before the Assistant Treasurer together with annexures to that Minute comprising correspondence from the overseas airlines. 19 That Minute, for instance, refers to the submissions made and the provision of "foreign legal advice" and states:
No question of privilege arises in respect to such "foreign legal advice".
Redacted on the basis of third party confidentiality
20 What is in issue is the claim for legal professional privilege in respect of advice provided to Treasury by a Senior General Counsel employed by the Australian Government Solicitor. That office is established by s 55J of the 1903 Act and established as a body corporate by s 55M. It is the disclosure of his advice, or the substance of his advice, which is now resisted by the Assistant Treasurer. 21 Immediately following the reference in the Minute to "foreign legal advice", for instance, material was initially deleted from the copy of the Minute provided to Cathay Pacific and in its place appeared the handwritten words:
That claim for confidentiality was apparently not pressed and that portion of the Minute has now been provided. Other portions of the Minute, however, have been deleted and in their place appear the words:
Redacted on the basis of legal professional privilege (LPP)An affidavit filed to support the claims for privilege variously describes the deleted portions as containing "confidential legal advice relating to the construction and application of section 5 to Auskay’s application for consent" and as containing "legal advice" or "advice". No significance was sought to be ascribed by Senior Counsel for Cathay Pacific to one or other of these descriptions.
THE DECISION OF THE PRIMARY JUDGE
[7] It seems to me that it is important to look at the circumstances giving rise to the inconsistency, assuming, as I do in this case, that legal professional privilege attaches to the relevant advices and the redacted parts of the Minute. [8] The relevant considerations relevant to the issue of determining the inconsistency are these in my view. The Minister has filed and served in these proceedings a statement of reasons which specifically refers to the fact that he proceeded to make a decision relevant in this case upon receipt of certain material, including the detailed Minute, and in making his decision he had before him the Minute. [9] Looking at the Minute it is apparent that in the process of the compiling of that Minute, and in its being taken into account by the Minister, the legal advice the subject of the redacted parts was considered by him, and presumably taken into account. That is what he says in the statement of reasons itself. He does not say, for instance, that certain parts of the Minute were not taken into account or discarded. So I must to [sic] treat the Minister as taking into account all the aspects of the Minute, including the aspects that are said to be privileged. [10] It is true that nowhere in the statement of reasons or in the Minute is there a reference to reliance upon legal advice without a reference to the redacted parts. In other words conclusions without reference to legal advice are reached and then the redacted parts continue in relation to those particular conclusions indicating the nature of the legal advice. [11] This is not a situation whereby in the statement of reasons or the Minute itself, there is any reference to the actual taking of the legal advice or the fact that the legal advice has been available. [12] If one then goes back to basic principle, we have a situation here where there is put into issue necessarily in the statement of reasons the considerations that are relevant to the Minister’s exercise of his discretion. All of the material that is relied upon in the statement of reasons, including the Minute, must be looked at by the court. In certain circumstances privileged material may never be seen by the court at trial where a Minister relies upon legal advice. But the extra ingredient in this case is the Minister has gone further by filing and serving the statement of reasons which, in effect, joins issue in the proceeding relating to the considerations taken into account by the Minister, which step is, in my view, decisive. [13] I should say something about some of the cases that have been referred to in argument. The case of Osland 234 CLR 275, whilst obviously reminding us of the principle in Mann [1999] HCA 66; 201 CLR 1, in my view, is not germane to the question that arises in this particular case. I do not think that the context in which that case was decided assists in determining whether or not there is inconsistency in this proceeding before me. ... [16] Nothing in what I have said above should lead anyone to the conclusion that in certain circumstances the Minister may not be able to rely upon legal professional privilege in advice and maintain the privilege in that advice. It is the circumstances of this particular case that gives rise to the inconsistency. These circumstances I have described as the conduct of filing the statement of reasons and the issues in this case referrable to the Minute itself. [17] Obviously it is a case quite different from the situation where litigation is not on foot and where you do not have the issues arising between the parties, as in this proceeding in an administrative law context.
22 The sole issue for resolution before Middleton J was whether or not there had been conduct by the Minister inconsistent with preserving the confidentiality of the legal advice received from the Australian Government Solicitor. No question arose, for example, as to either the Senior General Counsel or the Australian Government Solicitor lacking the requisite degree of independence to attract legal professional privilege: Waterford v The Commonwealth of Australia [1987] HCA 25; (1987) 163 CLR 54. 23 In rejecting the claim for privilege and in concluding that there had been conduct inconsistent with the maintenance of the claim, His Honour referred in his ex tempore ruling to the principles set forth in Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1 and Osland v Secretary, Department of Justice [2008] HCA 37, 234 CLR 275 and continued:
24 Pursuant to O 52 r 2AA(a) of the Federal Court Rules, Middleton J on 2 April 2009 made an order that the application for leave was to be heard by a Full Court. Whatever prior "uncertainty" there may have been as to a right to elect to make an application for leave to either a single judge or the Full Court, that "uncertainty" has now been resolved by O 52 r 2AA. "There is none": Harding v Deputy Commissioner of Taxation [2008] FCA 1516 at [4][2008] FCA 1516; , 172 FCR 469 at 471 per Moore J. On 7 April 2009 His Honour further ordered that the "application for leave to appeal and any appeal be heard instanter". Those are the matters now before this Court.
THE APPLICATION FOR LEAVE TO APPEAL
25 An order rejecting a claim for legal professional privilege and ordering the production of a document in its entirety is an interlocutory decision: Australian Competition and Consumer Commission v Cadbury Schweppes Pty Ltd [2009] FCAFC 32, 254 ALR 198; Commissioner of Taxation v Rio Tinto Ltd [2006] FCAFC 86 at [41], [2006] FCAFC 86; 151 FCR 341 at 353. 26 Leave to appeal is thus required: Federal Court of Australia Act 1976 (Cth) s 24(1A). 27 Although s 24(1A) confers an "unfettered discretion" in "unqualified terms" (Decor Corp Pty Ltd v Dart Industries Inc [1991] FCA 655; (1991) 33 FCR 397 at 399 per Sheppard, Burchett and Heerey JJ), it has been recognised that the guiding principles in the exercise of this discretion are essentially twofold and that leave may be granted where: • in all the circumstances the judgment of the primary judge is attended by sufficient doubt to warrant it being reconsidered by a Full Court; and • substantial injustice would result if leave were refused, supposing the decision were wrong.
See: Jarrett v Seymour (1993) 46 FCR 557; Brilliant Digital Entertainment Pty Ltd v Universal Music Australia Pty Ltd [2004] FCAFC 270, (2005) 63 IPR 373; Telstra Corporation Ltd v AAPT Ltd (1997) 38 IPR 539 at 542.
28 The affidavit in support of the application for leave asserts that the decision of the primary judge "has potentially serious implications for Commonwealth administration, extending beyond the particular legal advice to which the ruling relates". It further asserts that "one effect of his Honour’s ruling may be to discourage Commonwealth decision-makers from volunteering reasons for their decisions in such circumstances". The affidavit further states that the reasons provided "did not refer to, much less reveal anything about, the content of legal advice provided to the Treasury". 29 The application for leave to appeal was opposed by Cathay Pacific, essentially upon the basis that the decision of the primary judge did not in fact give rise to these more wide-ranging concerns. It is a decision which is said by Cathay Pacific to have "little precedential value". 30 The present application, however, does raise for resolution more than yet a further application of the principles in Mann and Osland to different factual circumstances. If incorrect, the interlocutory decision forever destroys the confidentiality in the legal advice received by the Assistant Treasurer. But that is true of any rejection of a claim to privilege. The more contentious issue is whether or not the mere reference in a statement of reasons to legal advice having been obtained and forming part of the decision-making process is sufficient to constitute a waiver of privilege. That is a matter of general application which supports the grant of leave to appeal. 31 It is considered, with respect, that the decision of the learned trial judge is both attendant with sufficient doubt to warrant it being reconsidered by a Full Court and that substantial injustice would result if leave to appeal were refused. Leave to appeal is thus granted.
INCONSISTENCY
Waiver of privilege at common law [28] At common law, a person who would otherwise be entitled to the benefit of legal professional privilege may waive the privilege. It has been observed that "waiver" is a vague term, used in many senses, and that it often requires further definition according to the context. Legal professional privilege exists to protect the confidentiality of communications between lawyer and client. It is the client who is entitled to the benefit of such confidentiality, and who may relinquish that entitlement. It is inconsistency between the conduct of the client and maintenance of the confidentiality which effects a waiver of the privilege. Examples include disclosure by a client of the client’s version of a communication with a lawyer, which entitles the lawyer to give his or her account of the communication, or the institution of proceedings for professional negligence against a lawyer, in which the lawyer’s evidence as to advice given to the client will be received.
32 There was no dispute between the parties that legal professional privilege may be waived and disclosure ordered if the party claiming the privilege has acted inconsistently with maintaining its confidentiality: Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1. Gleeson CJ, Gaudron, Gummow and Callinan JJ there observed (citations omitted):
Both before and after Mann, it has been said that "the governing principle required a fact-based inquiry as to whether, in effect, the privilege holder had directly or indirectly put the contents of an otherwise privileged communication in issue in litigation, either in making a claim or by way of defence": Commissioner of Taxation v Rio Tinto Ltd [2006] FCAFC 86 at [61], [2006] FCAFC 86; 151 FCR 341 at 359.
On the basis of legal advice received, Ampolex believes that it will be successful in the Convertible Note litigation.
33 As a general proposition, it is accepted that privilege is not waived simply by reason of mere reference to legal advice: Attorney-General for the Northern Territory v Maurice [1986] HCA 80; (1986) 161 CLR 475 at 481 per Gibbs CJ. 34 To constitute a waiver of privilege, or to act inconsistently with maintaining the privilege, more is thus required than mere reference to the existence of advice. Difficult questions may arise (for example) where the text of the legal advice is not disclosed but where it is said that the substance of the advice has been so disclosed that privilege can no longer be maintained. Thus in Ampolex Ltd v Perpetual Trustee Co (Canberra) Ltd (1996) 40 NSWLR 12, Rolfe J dismissed an application seeking the production of legal advice referred to in a Part B statement. That statement provided (inter alia):
Rolfe J observed (at 18) that in making the statement Ampolex may have:
... misconstrued or misunderstood the advice. However that may be, the statement does not rise above a statement of Ampolex’s view and it does not purport to state the advice, or its substance or effect and, therefore, it does not amount to a disclosure of the advice.Rolfe J rejected a distinction between disclosing the "substance" of an advice and its "effect". His Honour observed (at 19):
In my opinion the substance of the advice may well be disclosed if the ultimate conclusion, without the supporting reasoning process, is revealed. At that stage there has been, in my opinion, a disclosure of the substance of the advice, that is, what the advice is. Further the ultimate conclusion, whilst it may be a "result" or "consequence" of the reasoning is more than that: in its own right it is the essence or vital part of the advice. Some advices may be very short and answer the question with a minimum of reasoning or, in some circumstances, without any.An unsuccessful application was thereafter made to the Court of Appeal and a further application made to the High Court for a stay pending an application for special leave to appeal from the Court of Appeal decision. Kirby J dismissed the application for a stay: Ampolex Ltd v Perpetual Trustee Co (Canberra) Ltd [1996] HCA 15; (1996) 137 ALR 28.
[45] Waiver of the kind presently in question is sometimes described as implied waiver, and sometimes as waiver "imputed by operation of law". It reflects a judgment that the conduct of the party entitled to the privilege is inconsistent with the maintenance of the confidentiality which the privilege is intended to protect. Such a judgment is to be made in the context and circumstances of the case, and in the light of any considerations of fairness arising from that context or those circumstances. ... [46] The conduct of the Attorney-General in issuing the press release and including in it certain information about the joint legal advice is to be considered in context, which includes the nature of the matter in respect of which the advice was received, the evident purpose of the Attorney-General in making the disclosure that was made, and the legal and practical consequences of limited rather than complete disclosure.
35 More recently, in Osland, a petition for mercy had been declined. In issue was a claim for privilege pursuant to the Freedom of Information Act 1982 (Vic) and the manner in which that claim was to be resolved. Consideration was given to whether privilege had been waived by reason of a media release issued by the Attorney-General which stated that a memorandum of advice had been received from three named Queen’s Counsel and further stated that "[t]he joint advice recommends on every ground that the petition should be denied". Mann was applied and the conclusion reached that there had been no waiver of privilege. Gleeson CJ, Gummow, Heydon and Kiefel JJ observed (citations omitted):
Their Honours concluded in respect to this part of the case before them:
[48] The evident purpose of what was said in the press release was to satisfy the public that due process had been followed in the consideration of the petition, and that the decision was not based on political considerations. The three eminent lawyers who gave the advice were appointed following consultation with the State Opposition. They were external to the Department. Their advice covered all the grounds upon which the petition was based. They recommended denial of the petition. Their advice was carefully considered, and the petition was denied. The Attorney-General was seeking to give the fullest information as to the process that had been followed, no doubt in order to deflect any criticism, while at the same time following the long-standing practice of not giving the reasons for the decision. This did not involve inconsistency; and it involved no unfairness to the appellant. If she had a legal right to reasons for the decision, then she still has it. If she had no such right, the press release did not deprive her of anything to which she was entitled. What the Attorney-General said did not prevent the appellant from making public her petition, or any part of it, as and when she desired.Applied: Australian Competition and Consumer Commission v Cadbury Schweppes Pty Ltd [2009] FCAFC 32 at [101], [2009] FCAFC 32; 254 ALR 198 at 222 per Mansfield, Kenny and Middleton JJ.
PUBLIC LAW -- STATEMENTS OF REASONS
... This policy is defined in Council Rule No 4. Separate legal advice supporting PHIAC’s view of this rule has been received. A copy of that advice is attached.
36 These same principles apply to the resolution of a question as to whether privilege has been waived in a public law context by reason of what has been contained within a statement of reasons provided by a decision-maker. No different principles are appropriate even in those contexts where a statement of reasons has been provided voluntarily and without admission as to any entitlement that may arise pursuant to s 13 of the 1977 Act. Indeed, where reasons have been provided pursuant to s 13, a question may arise as to whether those reasons have been provided "under compulsion of law" for the purposes of s 122(5)(a)(iii) of the Evidence Act 1995 (Cth) ("the 1995 Act"). But that question need not now be further pursued. 37 By way of example, in Australian Unity Health Ltd v Private Health Insurance Administration Council [1999] FCA 1770, reference was made to legal advice in a recommendation which stated in part:
The statement of reasons annexed the letter containing the advice as part of the "evidence or other material on which findings were based". That reference to the letter, Goldberg J concluded, was not "a disclosure of the contents of the advice or a waiver of legal professional privilege". His Honour, however, formed "a different view in relation to the recommendation where it is explicitly stated that legal advice supporting the respondent’s view of Rule No 4 has been received": [1999] FCA 1770 at [18].
38 Similarly, it has been recognised that the use of legal advice in a way that contributes to a statutory decision does not itself constitute a waiver of privilege: New South Wales Council for Civil Liberties Inc v Classification Review Board [2006] FCA 1409 at [27], [2006] FCA 1409; 236 ALR 313 at 319.
THE PRESENT PROCEEDING -- THE "EXTRA INGREDIENT"
[12] ... gone further by filing and serving the statement of reasons which, in effect, joins issue in the proceeding relating to the considerations taken into account by the Minister ...
39 For the purposes of making a decision pursuant to s 5 of the 1974 Act, the Assistant Treasurer had to form an "opinion" as to whether the overseas conduct was "required or specifically authorised" by a law of the country in which the conduct took place: s 5(5)(a). 40 For the purposes of making that decision, the Assistant Treasurer not surprisingly had before him submissions as to those overseas laws. He also had before him the Treasury Executive Minute which incorporated the advice provided by the Australian Government Solicitor. 41 The learned primary judge accepted that "[a]ll of the material that is relied upon in the statement of reasons, including the Minute, must be looked at by the court". His Honour also accepted that "in certain circumstances" a Minister may be able to rely upon legal advice and maintain the privilege in that advice. 42 But, the "extra ingredient", according to the primary judge, which led to the waiver of the privilege in the present proceeding was the fact that the Assistant Treasurer had:
And the circumstance "of this particular case that gives rise to the inconsistency" was described:
[16] ... as the conduct of filing the statement of reasons ...[67] Further, in exposing his states of mind and the basis for it, the Commissioner would not ordinarily act in a manner inconsistent with the maintenance of privilege over legal advice relevant to his attaining a state of satisfaction or exercising his discretion in a particular way. Since the decision of the majority of the High Court in Waterford, it is plain enough that legal professional privilege may attach to communications brought into existence by government officers seeking or giving legal advice as to the nature and extent of governmental powers, whether statutory or otherwise: see Waterford at 63–4 per Mason and Wilson JJ and 74–5 per Brennan J. Even though such communications may contribute to the decision-making, the mere reference to this fact by a decision-maker in the course of defending a judicial review application or on a taxation appeal is not inconsistent with the maintenance of the privilege: compare Webb v Commissioner of Taxation (Cth) (1993) 44 FCR 312 at 317 per Cooper J and Lovegrove at [24] per Pullin J. This is because the decision-maker (here the Commissioner) would not put such legal advice in issue merely by saying that the advice was relevant or contributed to his decision. There would be no issue waiver because the decision-maker would not have done anything inconsistent with the maintenance of privilege. The situation might be otherwise if the decision-maker puts the contents of the legal advice in issue by specifically relying on the contents of the advice (and not merely the fact of the advice) to vindicate his claimed state of satisfaction or exercise of discretion.
43 With great respect to the primary judge, a contrary conclusion has been reached. 44 The starting point remains the proposition that the mere reference to legal advice being received, and the fact that such advice has played a part in the administrative decision-making process, does not necessarily involve any waiver of privilege. So much has been repeatedly accepted and now endorsed by the Full Court in Commissioner of Taxation v Rio Tinto Ltd [2006] FCAFC 86, 151 FCR 341. Kenny, Stone and Edmonds JJ there observed:
Special leave to appeal was refused: Commissioner of Taxation v Rio Tinto Ltd [2006] HCATrans 539. See also: New South Wales Council for Civil Liberties Inc at [28], 236 ALR at 319 per Edmonds J.
Documents to be filed (1) On the filing of an application for an order of review or as soon afterwards as is practicable, the applicant shall file copies of such of the following documents as are in his possession:
45 In the present proceeding, judicial review is being sought of the "opinion" reached by the Assistant Treasurer. The lawfulness of the decision made will ultimately be resolved. The sensitive commercial context in which that "opinion" is required to be made is not to be ignored. It is a context in which a decision-maker may well seek legal advice to assist in the decision-making process. 46 But, by voluntarily providing a statement of reasons, it is not considered that the Assistant Treasurer has "join[ed] issue". The statement of reasons does nothing more than expose the decision-making process pursued in forming the requisite "opinion" -- the same purpose served by statements of reasons in other judicial review cases. The administrative decision-maker in the present proceeding, it is considered, has done nothing more than most decision-makers do when their decisions are exposed to scrutiny in this Court. The merits of the decision as to whether or not the conduct of Cathay Pacific was "required or specifically authorised" in Hong Kong will not necessarily be resolved in the judicial review proceeding. That which will be resolved is whether the Assistant Treasurer when reaching his "opinion" proceeded in a manner authorised by law. The fact that the "opinion" required to be formed involves a consideration of the laws in overseas jurisdictions is no more a licence for this Court in a judicial review application to consider the merits of the case than it is to consider the merits of an "opinion" as to matters more factually oriented. 47 By reason of the fact that the Assistant Treasurer made the decision under review, he was obviously a necessary party to the judicial review proceeding. But, it is inappropriate in most judicial review proceedings to employ the language of a decision-maker "joining issue" with a party seeking review. Although a necessary party to the proceeding, a decision-maker does not normally become a protagonist in defence of the decision under review: R v The Australian Broadcasting Tribunal; Ex parte Hardiman [1980] HCA 13; (1980) 144 CLR 13. Even where a decision-maker has a statutory right to be heard, it has been said that he "should not as a general rule seek to present a substantive argument to support his decision, whether he is a party or not": Merck & Co, Inc v Sankyo Co Ltd [1992] FCA 198; (1992) 23 IPR 415 at 417 per Lockhart J. 48 Nor is significance to be attached either to the fact that the statement of reasons was filed by the Assistant Treasurer, or that it was filed at all. Order 54 r 3(1) of the Federal Court Rules provides as follows:
(a) a statement of the terms of the decision the subject of the application; and(b) a statement with respect to that decision furnished to the applicant pursuant to section 13 of the Administrative Decisions (Judicial Review) Act 1977 or section 28 of the Administrative Appeals Tribunal Act 1975, or any other statement furnished by or on behalf of the person who made the decision purporting to set out findings of facts or a reference to the evidence or other material on which those findings were based or the reasons for making the decision; unless a copy of that document has been filed previously in the proceeding.
The terms of r 3(1)(b), it will be noted, extend not only to a statement furnished pursuant to s 13 of the 1977 Act; they extend to "any other statement ... purporting to set out findings of facts or a reference to the evidence or other material on which those findings were based or the reasons for making the decision". That phrase would embrace the statement of reasons voluntarily provided by the Assistant Treasurer in the present proceeding. And it matters not that it was the Assistant Treasurer, rather than the "applicant", that filed the statement.
I do not read O 54, r 3 as dealing with any issue as to admissibility of such a statement at the trial. The rule does not say that. As the rule provides for the filing of a document, I take it that a judge may look at any document filed for an appropriate purpose, such as the management of the case prior to trial. A perusal of the decision and of any reasons that have been filed pursuant to r 3 will enable a judge the better to give directions for the conduct of the proceedings, whether they be on pleadings or by affidavit or by oral evidence, whether notice should be given to the Attorney- General or to any other party, to determine whether the decision was of a nature susceptible of review under the ADJR Act, to decide whether another avenue of review, eg review by the Administrative Appeals Tribunal, was available and more appropriate and so on. The rule is thus facultative.
49 The purpose of the rule is to make available to the Court a copy of a decision-maker’s decision and his reasons and findings. One purpose that the filing of a statement of reasons serves is to assist the Court in the management of a case prior to trial: Minister for Immigration and Ethnic Affairs v Taveli [1990] FCA 169; (1990) 23 FCR 162 at 165. Davies J there observed:
[105] ... The rationale of the obligation to provide reasons for administrative decisions is that they amount to a "salutary discipline for those who have to decide anything that adversely affects others". They encourage "a careful examination of the relevant issues, the elimination of extraneous considerations, and consistency in decision-making". They provide guidance for future like decisions. In many cases they promote the acceptance of decisions once made. They facilitate the work of the courts in performing their supervisory functions where they have jurisdiction to do so. They encourage good administration generally by ensuring that a decision is properly considered by the repository of the power. They promote real consideration of the issues and discourage the decision-maker from merely going through the motions. Where the decision effects the redefinition of the status of a person by the agencies of the State, they guard against the arbitrariness that would be involved in such a redefinition without proper reasons. By giving reasons, the repository of public power increases "public confidence in, and the legitimacy of, the administrative process".
50 To ascribe to the mere fact of filing a statement of reasons the significance given by the learned trial judge is, with respect, unwarranted. 51 Neither the fact that the statement of reasons was provided subsequent to the commencement of the proceeding, nor that it was provided voluntarily, is of relevance. Rule 3(1)(a) itself contemplates that the statement may be filed at the same time as the filing of an application for an order of review "or as soon afterwards as is practicable". Reasons provided voluntarily may be considered with a view to determining whether they expose legal error (Qu v Minister for Immigration and Multicultural Affairs [2001] FCA 1299 at [9] per Gray J) and scrutinised in the same manner as reasons provided pursuant to a statutory obligation (Ly v Minister for Immigration and Multicultural Affairs [2000] FCA 15 at [27] per Kenny J). See also: East Melbourne Group Inc v Minister for Planning [2008] VSCA 217 at [228], [2008] VSCA 217; 254 ALR 112 at 168 per Ashley and Redlich JJA. 52 The purpose served by the statement of reasons remains the same. The fact that the Assistant Treasurer stated that the reasons were provided in the present proceeding "to assist the parties" in no way detracts from the purposes otherwise served by the provision of written reasons, including providing assistance to the Court: Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Palme [2003] HCA 56, 216 CLR 212. Kirby J there observed (citations omitted):
Indeed, to give relevance to the time at which reasons are provided may only serve to both discourage the voluntary provision of reasons by decision-makers and to encourage unnecessary disputes as to whether there is a statutorily enforceable entitlement to reasons conferred by s 13 of the 1977 Act. In the present proceeding, the voluntary provision of reasons avoided what may have been a difficult question as to whether or not Schedule 2(f) of the 1977 Act applied and avoided what may have been considerable delay in the resolution of that question -- including, as in the present proceeding, an application for leave to appeal from that decision.
53 The statutory reform effected by s 13 of the 1977 Act was seen at the time as a reform of fundamental importance to the then emerging body of public law and the accountability of government. "To confer such a right", it was recognised, "would clearly alter the existing law": Australia, Parliament, Parliamentary and Government Publications: Prerogative Writ Procedures -- Report of Committee of Review, Parl Paper No 56 (1973) at [34]. And, when referring to then cl 13 in the Second Reading Speech on the Administrative Decisions (Judicial Review) Bill 1977 (Cth) the Attorney-General stated that "[n]o longer will it be possible for the decision maker to hide behind silence": Australia, House of Representatives, Debates (1977) Vol HR105, p 1394. No step should be taken to undermine the importance served by the provision of reasons for administrative decision-making. In particular, the trend since 1977 of voluntarily providing reasons should not be discouraged by exposing decision-makers to the prospect of having to expose legal advice received merely by reason of voluntarily providing reasons and by doing so subsequent to the commencement of a proceeding. The contrary conclusion is not warranted by the facts of the present case, authority or principle. 54 It would be an unnecessary and undesirable complication in the expeditious resolution of judicial review proceedings to encourage any course whereby reasons are only provided where there is an unquestioned statutory obligation to do so and for parties to thereafter potentially invoke s 122(5)(a)(iii) of the 1995 Act as a basis upon which it could then be said that privilege has not been waived.
INCONSISTENCY -- THE MINUTE AND THE STATEMENT OF REASONS?
Issues raised regarding the application Whether relevant foreign country laws require or specifically authorise the alleged conduct Correspondence from HKCAD Applicant’s submissions and respondent’s countersubmissions Comity Identification of conduct Preconditions to consent pursuant to subsection 5(4)
55 If the filing of the statement of reasons did not occasion any waiver of privilege, conduct inconsistent with maintenance of confidentiality necessarily had to be found elsewhere -- if at all. 56 Cathay Pacific did not contend that the substance of any legal advice provided by the Australian Government Solicitor was to be found partially disclosed in the Treasury Executive Minute. Indeed, nowhere in the expurgated Minute is there any disclosure of the substance of the legal advice provided by the Australian Government Solicitor. The only thing which may be gleaned from the form of the Minute is that the legal advice provided was at least considered relevant to a number of discrete matters. The Minute identified a number of "Key Points" and also contained a segment directed to what it identified as "Additional Information". Under that heading there appeared, among others, the following subheadings:
Under each of these subheadings, portions of the Minute had been deleted and the handwritten words inserted in lieu: "Redacted on the basis of LPP". There was a similar deletion of material under the heading "Key Points". It is pure speculation what the content of the legal advice relevant to each of those issues may have been.
Inspection to decide objection Where an application is made for an order under rule 11 for the production of any document for inspection by another party or for an order under rule 13 for the production of any document to the Court and a claim is made that the document is privileged from production or an objection to production is made on any other ground, the Court may inspect the document for the purpose of deciding the validity of the claim or objection.
57 The alternative source of "inconsistent conduct" which Cathay Pacific sought to rely upon on appeal was said to be found in the statement of reasons and, in particular, paragraphs [32] to [39]. Those paragraphs to which attention was specifically directed in oral submissions were paragraphs [32] and [34]. 58 Paragraph [32] of the statement of reasons referred back to paragraph [23] and the finding there set forth as to Auskay’s advice that "the alleged conduct was not authorised or required by the laws of any of the relevant countries". That "finding" was said to be based upon the "evidence" identified in paragraph [32], including the entirety of the Treasury Executive Minute -- including the legal advice from the Australian Government Solicitor. That "finding" was said to be "particularly" based on that Minute. 59 And, similarly, paragraph [34] referred back to paragraph [25] and the "finding" that the Assistant Treasurer "was not satisfied that all or any part of the alleged conduct was required or specifically authorised by the law of any of the countries the subject of the application for consent". Again, the "evidence" relied upon to support that finding was (inter alia) "based ... particularly on the Treasury Executive Minute ...". 60 There were also two deletions from that part of the Minute under the heading "Key Points". 61 There is some textual uncertainty as to the extent to which the "findings" as made by the Assistant Treasurer were in fact based upon the legal advice provided by the Australian Government Solicitor -- that being truly a matter of advice -- as opposed to such "evidence" as may have been contained within the advices provided as to overseas law -- that being a matter of fact. And there may be further uncertainty as to whether any distinction has been drawn by the Assistant Treasurer as between so much of the advice provided by the Australian Government Solicitor as may be a recitation of facts as opposed to any legal advice that may have been provided in respect to those facts and contained within the advice. 62 But, however those uncertainties may be resolved, it is concluded that such statements as were made by the Assistant Treasurer in the reasons provided amount to no more than a statement that he made his decision based upon all of the materials before him -- particularly the Minute. There is no further identification by the Assistant Treasurer of the part or parts of the Minute to which he was referring. Presumably the reference to the Minute was a reference to the Minute in its entirety. A statement that a "finding" has been based upon the Treasury Executive Minute says nothing which identifies that part of the Minute to which reference is being made and, more importantly, says nothing as to the content of the Minute. The statement that he had "particular" regard to the Minute discloses nothing further as to the content of the Minute. Such statements are not statements inconsistent with maintaining the confidentiality of so much of that Minute as sets forth legal advice. 63 Even if an inference were to be drawn that the Assistant Treasurer had "particular" regard to that part of the Minute which specifically addressed the findings being made and the evidence upon which those findings were based, a finding as to any "inconsistent" conduct or any "unfairness" would be made even more difficult. In this more confined context, it may be noted that paragraphs [23] to [27] are contained within that part of the statement of reasons headed "Was conduct specifically required or authorised by the laws of the relevant countries?" The corresponding part of the Treasury Executive Minute dealing with "foreign legal advice" initially withheld material upon the basis of "third party confidentiality" -- but that claim was abandoned and that material subsequently made available. One sentence has been deleted from the subheading which reads "Correspondence from HKCAD [Hong Kong Civil Aviation Department]". No "inconsistent conduct", it is considered, thus emerges from paragraphs [23] and [25] (or paragraphs [32] or [34]) of the statement of reasons. No different conclusion should be reached in respect to paragraphs [33] or [35]. Nor should any different conclusion be reached in respect to paragraphs [36] to [38]. 64 During the course of oral submissions, the Solicitor-General sought to make available to the Court the Treasury Executive Minute in its unexpurgated form. Notwithstanding the fact that an affidavit claiming privilege is normally conclusive (e.g. Financial Management Professionals Group Pty Ltd v Gray [2005] FCA 1077), the Court retains a discretion to itself inspect a document. But there are well recognised dangers in a Court doing so lest it be thought to prejudice its impartiality -- especially where it is the trial judge who carries out the inspection: see Grant v Downs [1976] HCA 63; (1976) 135 CLR 674 at 677 per Barwick CJ. The Solicitor-General nevertheless contended that the Court could inspect the Minute and further contended that an express power to do so is now conferred pursuant to O 15 r 14 of the Federal Court Rules, which provides as follows:
In exercising the discretion conferred by this rule, much the same principles as previously informed the exercise of the discretion have been applied: Holmes v Deputy Commissioner of Taxation (NSW) (1987) 19 ATR 1278 at 1283 to 1285 per Davies J. Notwithstanding the terms of O 15 r 14, which confer a discretion to inspect a document "for the purpose of deciding the validity of the claim ...", it was understood that the Assistant Treasurer sought to make the Minute available for a more confined purpose -- namely to demonstrate that the redacted portions of the Minute did not contain any evidence as to the content of foreign law but were confined to advice in respect to Australian law.
65 In the present proceeding, the unexpurgated Minute had been made available to the primary judge. Senior Counsel for Cathay Pacific consented to this Court also having access to the Minute in its entirety. In such circumstances, the Court inspected the unexpurgated Minute. Whatever may have been embraced within that consent, and whatever may have been the limited purpose contemplated by the Solicitor-General, a review of the unexpurgated Minute has provided little assistance in the resolution of the present contentions.
THE NOTICE OF CONTENTION -- ALL OR NOTHING
66 In the event that leave to appeal were granted, the First Respondent’s Notice of Contention sought to contend that there is an alternative basis upon which the decision of the primary judge should be upheld, namely that the disclosure of part of the Treasury Executive Minute "constitutes a waiver of legal professional privilege over the remainder of the document". 67 Order 52 r 22(3)(a) of the Federal Court Rules provides for the filing of a Notice of Contention "within 21 days after the service upon the respondent of the notice of appeal, or within such further time as the Court or a Judge fixes ...". 68 In the present proceeding, no question of non-compliance with O 52 r 22(3)(a) arises for the simple reason that, until leave was granted, there was no Notice of Appeal. It is desirable, however, for any prospective Notice of Contention to be also included in an Application Book prepared for the purposes of any concurrent hearing of an application for leave to appeal and the appeal in the event that leave is granted. The Court is thereby forewarned of all issues the parties seek to raise. 69 Written submissions filed by Cathay Pacific in support of its Notice of Contention again rely upon an asserted lack of "fairness" in the Assistant Treasurer disclosing part -- but not all -- of the Treasury Executive Minute. The importance of this Minute to the reasoning process of the Assistant Treasurer is a matter placed at the forefront of Cathay Pacific’s contention. Those reasons acknowledge that there was before the Assistant Treasurer when he gave his consents the "detailed Treasury Executive Minute" and further acknowledge that he based his finding "particularly on the Treasury Executive Minute" and identified advices. 70 Again employing the language of "inconsistency", the "inconsistency" in the conduct of the Assistant Treasurer now relied upon is not any "inconsistency" attributable to either: • disclosing part, but not all, of the substance of the legal advice sought to be protected; or • providing a statement of reasons voluntarily and after the commencement of the proceeding;
but rather
[29] ... What brings about the waiver is the inconsistency, which the courts, where necessary informed by considerations of fairness, perceive, between the conduct of the client and maintenance of the confidentiality; not some overriding principle of fairness operating at large.
• an asserted unfairness in disclosing only part of the entire reasoning process. 71 In advancing this contention, Cathay Pacific accepts that "fairness" is not some overriding principle operating at large, but rather contends that "fairness" is a relevant consideration when determining whether conduct has been "inconsistent" with maintaining confidentiality in legal advice: Mann v Carnell [1999] HCA 66, 201 CLR 1. Gleeson CJ, Gaudron, Gummow and Callinan JJ there observed:
Their Honours continued:
[34] ... Depending upon the circumstances of the case, considerations of fairness may be relevant to a determination of whether there is such inconsistency."[T]he relevant issue is inconsistency, not general fairness": Bailey v Department of Land and Water Conservation [2009] NSWCA 100 at [4] per Allsop P; see also at [81] per Tobias JA (Hodgson JA agreeing).
... it is clearly in the public interest that those in government who bear the responsibility of making decisions should have free and ready confidential access to their legal advisers.
72 In resolving the Notice of Contention, it may be accepted that the deletion of portions of the Treasury Executive Minute necessarily has the consequence that the Minute is thereby "incomplete". But it is not accepted, as is the further contention advanced by Cathay Pacific in its written submissions, that the balance of the Minute is thereby rendered "ambiguous". 73 The purpose of the Treasury Executive Minute was to place before the Assistant Treasurer material upon which he could make an informed decision. That material has been identified. The Assistant Treasurer has made his decision and made his findings, including his finding at paragraph [25] of his statement of reasons that he had regard to the legal advices before him "and the conflict between those legal advices" and that he "was not satisfied that all or any part of the alleged conduct was required or specifically authorised by the law of any of the countries the subject of the application for consent". 74 The withholding of the legal advice received from the Australian Government Solicitor, it is considered, has not occasioned any "ambiguity" or any "unfairness". Those parts of the Minute containing legal advice occur throughout the Minute, but each of those parts is considered to be severable from the balance of the document. The disclosure of that legal advice may well facilitate a greater understanding of the reasoning process pursued by the Assistant Treasurer, but the maintenance of the confidentiality in the legal advice operates no "unfairness". The maintenance of that confidentiality does not deny to Cathay Pacific the ability to know what material has or has not been taken into account. 75 To reach a contrary conclusion may well place the Assistant Treasurer in an invidious position. The area of decision-making presently entrusted to him is one of some legal complexity and one touching upon the national interests of Australia. It is an area of decision-making in which the provision of legal advice from the Australian Government Solicitor may well be both desirable and expected. It would be invidious to place the Assistant Treasurer in a position which denies him the ability to obtain and rely upon legal advice except upon terms that the advice be disclosed. It is of importance to ensure that those who have the responsibility of making decisions have access to legal advice: Waterford 163 CLR at 62. Mason and Wilson JJ there observed:
Their Honours later observed (at 64):
The growing complexity of the legal framework within which government must be carried on renders the rationale of the privilege, as expressed in Grant v Downs, increasingly compelling when applied to decision-makers in the public sector. The wisdom of the centuries is that the existence of the privilege encourages resort to those skilled in the law and that this makes for a better legal system. Government officers need that encouragement, albeit, perhaps, for reasons different to those which might be expected to motivate the citizen.A contrary conclusion would also be inconsistent with Osland.
The appellant’s submission fails to appreciate that the sole purpose test is a test that looks to the reason why the document was brought into existence. If its sole purpose was to seek or to give legal advice in relation to a matter, then the fact that it contains extraneous matter will not deny to it the protection of the privilege. The presence of matter other than legal advice may raise a question as to the purpose for which it was brought into existence but that is simply a question of fact to be determined by the Tribunal and its decision on such a question is final.
76 In those circumstances -- as in the present case -- where legal advice can be severed from the balance of a document, and where that which is disclosed meaningfully informs a reader as to those matters taken into account by a decision-maker, no implied waiver of privileged material occurs. It would be an equally invidious result should it be concluded that Cathay Pacific was to be denied the benefit of gaining access to so much of the materials as was considered by the Assistant Treasurer not to be privileged merely by reason of the presence of some privileged material. Protection of the substantive right to keep confidential legal advice received can no more be relied upon to render confidential the entirety of a document in which such advice may appear than the disclosure of non-confidential material can be relied upon to deny the continued confidentiality of legal advice received. Neither principle nor authority dictates any contrary conclusion. 77 In the present case the legal advice provided by the Australian Government Solicitor is clearly severable from the balance of the Treasury Executive Minute. That which remains is not ambiguous. Even had a contrary conclusion been reached, however, it is further concluded that the maintenance of the confidentiality of that advice was properly secured by its deletion from the copy of the document provided to Cathay Pacific. There is no rule of law that objection cannot be taken to production of part of a document on the ground of legal professional privilege: Grofam Pty Ltd v Australia and New Zealand Banking Group Ltd (1993) 43 FCR 408 at 414. Heerey J there applied the decision of the Full Court of the Supreme Court of Queensland in Curlex Manufacturing Pty Ltd v Carlingford Australia General Insurance Limited [1987] 2 Qd R 335 at 339. His Honour declined to follow the decision of the Supreme Court of Victoria in Hongkong Bank of Australia Ltd v Murphy [1993] 2 VR 419. In that case Smith J had concluded that the decision of the High Court in Waterford did not support the proposition that privilege could attach to part of a document. In so concluding, His Honour cited the following observations of Mason and Wilson JJ:
But, and as pointed out by Heerey J in Grofam, Smith J did not go on and cite the immediately following sentences in the joint judgment, namely:
It may also be appropriate in a particular case for the Tribunal to require those parts of the document which do not bear the necessary relation to legal advice to be disclosed. The doctrine of legal professional privilege allows room for questions of fact and degree such as these to fall for decision.Waterford was, of course, a case arising under the Freedom of Information Act 1982 (Cth). The Curlex decision has been applied by other judges of this Court (GEC Marconi Systems Pty Ltd v BHP Information Technology Pty Ltd [2000] FCA 593 at [11] per Lehane J) and other Courts (e.g. Areva NC (Australia) Pty Ltd v Summit Resources (Australia) Pty Ltd (No 2) [2009] WASC 67 at [22] per Martin CJ). It is a decision which has rightly commended itself to the English Court of Appeal as a "masterly judgment ... which is required reading": GE Capital Corporate Finance Group Ltd v Bankers Trust Co [1995] 1 WLR 172 at 176 per Hoffman LJ.
78 The decision in Curlex is considered to be clearly correct. Indeed, it is not understood that Cathay Pacific ultimately contended that the decision was incorrect; nor did Cathay Pacific endorse the contrary approach of Smith J in the Hongkong Bank case. The contention as advanced was a more broadly based contention that it was "unfair" for the Assistant Treasurer to have disclosed some, but not all, of his reasoning. A suggestion that the Assistant Treasurer was "cherry-picking" in the material he disclosed, and that which he withheld, was abandoned. There is no necessary "unfairness" in deleting that part of a document which is privileged even though the privileged part deals with the same subject matter as that contained in the balance of the document. The Assistant Treasurer was doing no more than disclosing the entirety of his reasoning process, other than that for which privilege was claimed. In doing so there has been no "unfairness". 79 If it be accepted -- as it must -- that parts of a document may be withheld on the basis of legal professional privilege, and if the deletion of those parts does not create any ambiguity or render the balance of the document misleading, it is difficult to conclude that the continued preservation of the confidentiality of the privilege is "unfair". It may possibly be envisaged that in some cases "unfairness" may arise if a party gains some forensic advantage in disclosing parts of a document but withholding some other parts. But the Assistant Treasurer has gained no forensic advantage in the present proceeding by voluntarily providing a statement of reasons together with an expurgated version of the Treasury Executive Minute for the simple reason that he is not a "protagonist" in the present proceeding. 80 Although the information withheld is that contained within the Minute, when considering whether or not there has been any "unfairness", the resolution of that question cannot be divorced from the information that is contained within the statement of reasons voluntarily provided. So construed, that statement adequately puts Cathay Pacific in the position whereby it knows the basis upon which the Assistant Treasurer proceeded. That is a principal objective sought to be achieved in reasons provided by an administrative decision-maker. 81 There has been no "unfairness" as is contended in the Notice of Contention. It is rejected.
CONCLUSIONS
82 It is thus concluded that leave to appeal should be granted and the appeal allowed. 83 There is no reason why the normal approach as to the exercise of the discretion as to costs should not be followed. Costs should follow the event. 84 The orders which it is proposed should be made are: 1. Leave to appeal as sought in the Notice of Motion dated 1 April 2009 is granted. 2. The appeal is allowed. 3. The First Respondent is to pay the costs of the Applicant on the Motion.
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I certify that the preceding eighty (80) numbered paragraphs are a true
copy of the Reasons for Judgment herein of the Honourable
Justice Flick.
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Associate:
Dated: 31 August 2009
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Solicitor for the Applicant:
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Australian Government Solicitor
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Counsel for the First Respondent:
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Mr J B R Beach QC with Mr A M Dinelli
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Solicitor for the First Respondent:
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DLA Phillips Fox
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Solicitor for the Second Respondent:
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Ms K Parker (Maurice Blackburn)
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URL: http://www.austlii.edu.au/au/cases/cth/FCAFC/2009/105.html