Hogan v Australian Crime Commission [2009] FCAFC 71 (19 June 2009)

Last Updated: 19 June 2009

FEDERAL COURT OF AUSTRALIA

Hogan v Australian Crime Commission [2009] FCAFC 71

PRACTICE AND PROCEDURE: Application for leave to appeal – whether decision below attended with sufficient doubt to warrant reconsideration by the Full Court – whether substantial injustice would result if leave to appeal refused – operation and scope of confidentiality orders under s 50 Federal Court of Australia Act 1976 (Cth) – application of the principles of open justice.


Federal Court of Australia Act 1976 (Cth), ss 20, 24(1A), 50
Australian Crime Commission Act 2002 (Cth), s 7, 29

Adam P Brown Male Fashions Pty Limited v Philip Morris Inc [1981] HCA 39; (1981) 148 CLR 170
A3 v Australian Crime Commission (No 3) [2006] FCA 1143
Australian Broadcasting Commission v Parish [1980] FCA 33; (1980) 29 ALR 228
C v Australian Crime Commission [2005] FCA 1736
Commissioner of Australian Federal Police v Propend Finance Pty Ltd [1997] HCA 3; (1996-1997) 188 CLR 501
Cox v Railton (1884) 14 BD 153
Décor Corporation Pty Ltd v Dart Industries Inc [1991] FCA 655; (1991) 33 FCR 397
Gronow v Gronow [1979] HCA 63; (1979) 144 CLR 513
Hearne v Street [2008] HCA 36; (2008) 235 CLR 125
Herald & Weekly Times Ltd v Williams [2003] FCAFC 217; (2003) 130 FCR 435
Hogan v Australian Crime Commission (No 4) [2008] FCA 1971
House v The King [1936] HCA 40; (1936) 55 CLR 499
Johnston v Cameron [2002] FCAFC 251; (2002) 124 FCR 160
Llewellyn v Nine Network Australia [2006] FCA 836; (2006) 154 FCR 293
Minogue v Williams [2000] FCA 125; (2000) 60 ALD 366
Niemann v Electronic Industries Ltd [1978] VR 421
Parish v Australian Broadcasting Commission [1980] FCA 33; (1980) 29 ALR 228




PAUL HOGAN v AUSTRALIAN CRIME COMMISSION, THE CHIEF EXECUTIVE OFFICER OF THE AUSTRALIAN CRIME COMMISSION and NATIONWIDE NEWS PTY LIMITED AND JOHN FAIRFAX PUBLICATIONS PTY LIMITED
NSD 1503 of 2008


MOORE, JESSUP AND GILMOUR JJ
19 JUNE 2009
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD1503 of 2008

ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:

PAUL HOGAN Appellant

AND:	AUSTRALIAN CRIME COMMISSION First Respondent THE CHIEF EXECUTIVE OFFICER OF THE AUSTRALIAN CRIME COMMISSION Second Respondent NATIONWIDE NEWS PTY LIMITED AND JOHN FAIRFAX PUBLICATIONS PTY LIMITED Interveners

JUDGES:	MOORE, JESSUP AND GILMOUR JJ
DATE OF ORDER:	19 JUNE 2009
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1. The application for leave to appeal be granted.

2. The appeal be dismissed.

3. The appellant pay the respondents’ costs and the interveners’ costs of the application for leave to appeal and the appeal.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using eSearch on the Court’s website.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD1503 of 2008

ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:

PAUL HOGAN Appellant

AND:	AUSTRALIAN CRIME COMMISSION First Respondent THE CHIEF EXECUTIVE OFFICER OF THE AUSTRALIAN CRIME COMMISSION Second Respondent NATIONWIDE NEWS PTY LIMITED AND JOHN FAIRFAX PUBLICATIONS PTY LIMITED Interveners

JUDGES:	MOORE, JESSUP AND GILMOUR JJ
DATE:	19 JUNE 2009
PLACE:	SYDNEY

REASONS FOR JUDGMENT

MOORE J:

1 I have had the advantage of reading the reasons for judgment of both Jessup J and Gilmour J in a draft form. I gratefully adopt their respective account of the facts and legal issues. Except on one issue, I generally agree with the reasons of Jessup J and, in particular, agree that the exercise of the discretionary power by the primary judge did not miscarry. However, for reasons which I briefly explain, I would grant leave to appeal but would dismiss the appeal.

2 I do not share Jessup J's reservations about the approach of Branson J in Johnston v Cameron [2002] FCAFC 251; (2002) 124 FCR 160. It recognizes two things. The first is that an appellate court should be extremely cautious in allowing the appellate jurisdiction to be fully enlivened by the grant of leave in relation to challenges to interlocutory judgments and all the more so if the judgment concerned a matter of practice and procedure. The second is that some interlocutory judgments, which might apparently concern matters of practice and procedure, finally resolve a particular issue which irrevocably affects the interests of a party. The observations of Branson J have been referred to, with approval, by a subsequent Full Court: Seven Network Ltd v News Ltd [2005] FCAFC 125 at [5] per Branson J with Allsop and Edmonds JJ agreeing at [21] and [40] respectively. The broad discretionary power to grant leave has to accommodate what Gibbs CJ, Aiken, Wilson and Brennan JJ described in Adam P Brown Male Fashions Pty Limited v Philip Morris Inc [1981] HCA 39; (1981) 148 CLR 170 at 177 as the circumstances of different cases which are infinitely various.

3 In the present case I would grant leave essentially for two reasons. The first is that this case is extremely unusual. The documents in question were tendered with the protection afforded by an order under s 50 of the Federal Court of Australia Act 1976 (Cth) and only lost that protection because the order was later revoked. In this respect, it concerns the effect of s 50 well beyond its normal field of operation. The second is that some of the observations of the learned primary judge might, by way of initial impression only, suggest his Honour failed to give sufficient weight to the fact that the contentious documents were tendered when they were protected by a s 50 order.

4 The genesis of the s 50 order which provided the protection at the time of the tender, was a judgment of Allsop J of 21 November 2005: C v Australian Crime Commission [2005] FCA 1736. It is apparent from his Honour's reasons for judgment that he was dealing with two notices of motion seeking orders under the section. One was a motion of the present applicant, the other a motion from the respondents. It is also apparent that the orders were made in the application of the respondents for the reasons advanced by the respondents, namely that the disclosure of information would prejudice its investigations: see [20] and [21]. Also, it is clear that his Honour would not have made orders under the section on the application of the present applicant on the grounds that the revelation of information concerning the applicant might damage his reputation. It was not suggested in these proceedings that any subsequent consideration was given to the foundation of the later orders made under s 50 on the application of both the applicant and the respondents. It would appear both sought such orders on the footing that the rationale for them had been established in November 2005 by Allsop J. That continued to be so at the time the s 50 order was made on 19 May 2008.

5 It was clear that the tender by the applicant’s counsel on 19 May 2008 of the contentious documents involved a forensic risk that the s 50 regime under which the tender could be made confidentially, might unravel having regard to the events set out by Jessup J at [16] and following. Some passages from the affidavit of the applicant's solicitor are set out by Gilmour J at [102] and, in particular, paragraph 14 of that affidavit. In that paragraph the solicitor says that if the respondents had indicated they would no longer maintain the position of supporting or not opposing such orders being made, then he would have instructed counsel to withdraw the affidavits and exhibits to allow them to be recast. For my part, I think this is something of a gloss on what occurred and the position the solicitor and his client were in on the morning of 19 May 2008. What was said by counsel for the respondents at the hearing and before the tender of the contentious documents, plainly put the applicants on notice that the confidentiality regime reflected in a succession of orders made under s 50 was at risk because the respondents no longer contended that confidentiality was necessary.

6 As Jessup J has demonstrated, no error of principle attended the discretionary decision of the primary judge to make the orders the subject of these proceedings. I would grant leave to appeal but dismiss the appeal with costs. While leave to appeal has been granted, the applicant has failed overall and should pay the costs of the respondents and interveners of both the application for leave and the appeal.

I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Moore.

Associate:

Dated: 18 June 2009

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 373 of 2006

BETWEEN:

PAUL HOGAN Appellant

AND:	AUSTRALIAN CRIME COMMISSION First Respondent THE CHIEF EXECUTIVE OFFICE OF THE AUSTRALIAN CRIME COMMISSION Second Respondent

JUDGES:	MOORE, JESSUP & GILMOUR JJ
DATE:	19 JUNE 2009
PLACE:	SYDNEY

REASONS FOR JUDGMENT

JESSUP J:

7 This is an application, by motion of which notice was given on 11 September 2008, for leave to appeal from an order made by Emmett J on 29 August 2008. His Honour ordered that all current orders in the proceeding then before him (NSD 373 of 2006) under s 50 of the Federal Court of Australia Act 1976 (Cth) be vacated. The present application is for leave to appeal from that order only to the extent that it vacated the following order made by his Honour on 21 August 2008: "There be no publication of the documents behind Tabs C and E of Exhibit DPR1 to the affidavit of David Peter Rydon of 13 February 2008...".

8 The Notice of Motion came before Foster J on 12 September 2008, at which time his Honour ordered that the application for leave to appeal be referred to the Full Court and that, subject to any further order of the Full Court, the appeal be heard at the same time as the application (assuming the application to be successful). In the circumstances, the questions which now arise are whether leave should be granted to appeal from Emmett J’s order vacating the order made on 21 August 2008 as set out above, and if so, whether that appeal should be allowed.

9 The applicant for leave to appeal, Paul Hogan, is a well-known entertainer. The first respondent is the Australian Crime Commission constituted under the Australian Crime Commission Act 2002 (Cth) ("the ACC Act"). The second respondent is the Chief Executive Officer of the Commission. In the reasons which follow, I shall make no distinction between the respondents, and shall refer only to the Commission. Nationwide News Pty Ltd and John Fairfax Publications Pty Ltd ("the interveners") were heard as interveners by Emmett J, and also appeared on the application for leave to appeal. Indeed, the interveners carried the burden of the opposition to that application.

10 The originating proceeding before Emmett J was commenced in the following circumstances. The Commission was conducting a special investigation pursuant to a determination under s 7C of the ACC Act. On 30 September 2005, the Commission issued a notice under s 29 of the ACC Act addressed to a firm of accountants in Sydney ("the accountants"), requiring them to produce documents described in the schedule to the notice. The schedule referred to documents which related to the affairs of a number of individuals, including the applicant. The accountants produced those documents to the Commission as required.

11 When the applicant became aware that the accountants had provided documents relating to his affairs to the Commission, he caused the instant proceeding to be instituted. That was done on 23 February 2006, and, initially, was done in the name of a consultant to the applicant, described as "A3". In his Application, the applicant sought to restrain the respondents from using or disseminating the material contained in the documents produced by the accountants upon the ground that that material was protected by legal professional privilege. When the proceeding came before the court, the Commission made it clear that it disputed the applicant’s claim to privilege, and that it would contend that any privilege which might otherwise subsist had been destroyed because the documents to which the applicant’s claim related had been created in furtherance of a crime, fraud or impropriety (to which I shall refer as the crime or fraud exception). In the result, on 7 March 2006, the Commission undertook that the documents in dispute would be sealed up pending the determination by the court of the applicant’s claim to privilege.

12 The matter of access to the documents in dispute was complicated also by the Commission’s claim that the documents not be made available to anyone other than counsel and solicitors for the Commission. That is to say, the Commission proposed that the documents should not be seen either by the applicant or by his own legal advisers. In the circumstances, in May and July 2006, Emmett J received evidence and submissions on the primary question whether the documents were such as would attract legal professional privilege (ie deferring, for the moment, the question whether any such privilege would be defeated by the crime or fraud exception). The parties requested Emmett J to examine the documents and to make a prima facie (but not final) ruling whether they were such as would sustain a claim for privilege. His Honour did so proceed, and, by a judgment given on 21 July 2006, held that the documents were, prima facie, entitled to privilege: see A3 v Australian Crime Commission (No. 2) [2006] FCA 929. By this stage, the applicant had been added as an applicant on the record (which was done on 11 May 2006) although then referred to only by the pseudonym "P". The original applicant, the consultant, was removed from the record in November 2006.

13 The course followed by the proceeding thereafter is generally described by Emmett J in a costs judgment given on 22 December 2008: see Hogan v Australian Crime Commission (No 4) [2008] FCA 1971, [42]-[51]. For a time after his Honour’s judgment of 21 July 2006, it seems that the focus of the parties’ attention shifted to what his Honour described as a "related proceeding". In his costs judgment, Emmett J said that, during this period, "disputation concerning discovery continued". In the period to November 2006, his Honour made a number of orders under s 50, which were listed in an affidavit of John Dines, a staff member of the Commission, sworn on 24 July 2008, as follows:

Since 23 February 2006, when this proceeding was instituted, several confidentiality orders have been made. These include orders made on: - 7 March 2006, as to A3’s name and address; - 11 May 2006, as to: - P’s name and address;

- pages 121 to 126, 128 - 131, 133 - 136 of the affidavit of David Peter Rydon sworn on 23 February 2006;

- Exhibit DPR-1 to the affidavit of David Peter Rydon sworn on 13 April 2006;

- the affidavit of Marcus J. Davis sworn on 19 April 2006; - the affidavit of Marcus J. Davis sworn on 5 May 2006; - the affidavit of Marcus J. Davis sworn on 11 May 2006;

- exhibits MAT 1 and MAT 14 to the affidavit of Melissa Allwynne Taylor sworn on 13 April 2006;

- Exhibits IMA 1 and IMA 2 to the affidavit of Ian Macdonald Andrew sworn on 1 May 2006;

- the confidential affidavit of Ian Macdonald Andrew sworn on 5 May 2006, and its exhibit (Confidential Exhibit IMA 1); and

- the five exhibits to the confidential affidavit of Ian Macdonald Andrew sworn on 11 May 2006;

- 25 May 2006, as to the confidential affidavit of Ian Macdonald Andrew sworn on 1 May 2006 and its seven exhibits; - 13 July 2006, as to: - the affidavit of Marcus J. Davis sworn on 20 June 2006, and its exhibits; and - Exhibit IMA 21. - 21 July 2006, as to the reasons for judgment delivered on 21 July 2006; - 11 August 2006, as to the confidential affidavit of Ian Macdonald Andrew sworn on 11 August 2006; - 17 November 2006, as to the disclosure regime for the confidential affidavits of Ian Macdonald Andrew sworn on 5 May 2006, 11 May 2006 and 24 May 2006, and certain exhibits thereto;

Those orders were made because, for his or its own reasons, each of the parties desired much of the evidence read in, and some other aspects of, the proceeding to be kept confidential. The Commission did not want the details of its special investigation to lose the cloak of confidentiality which they enjoyed under the ACC Act. In the hearing of the present application, there was some argument about the identity of the party who or which had sought the various s 50 orders made by Emmett J (ie whether in any particular instance it was the applicant or the Commission). However, little turns on such distinctions. The fact is that there was a substantial measure of common assent to the making of s 50 orders from time to time.

14 On 8 June 2007, the applicant applied for discovery in relation to the Commission’s contention that his privilege claim was defeated by the crime or fraud exception. On 9 August 2007, the applicant filed an amended Notice of Motion in this regard, and Emmett J made orders requiring the Commission to conduct inquiries and to produce a list of documents concerning inferences said to support the exception. This list, subsequently referred to by his Honour as an "inference schedule", was produced by the Commission. It was served on the applicant. Self-evidently, it is a contentious document because it refers, in a summary way, to the respects in which a criminal, fraudulent or like purpose – on the part of the applicant, his associates or advisers – is to be inferred from documents in the possession of the Commission.

15 On 7 December 2007, the applicant filed another Notice of Motion seeking further and better discovery from the Commission in relation to its claim that the crime or fraud exception applied. In support of that motion, the applicant’s solicitor, Mr David Rydon, swore an affidavit on 13 February 2008, which was not then filed (because of the confidential nature of the material it contained). Paragraph 3 of that affidavit read, in part:

Now produced and shown to me and marked "DPR-1" is a paginated bundle containing;

a. A copy of correspondence between the Applicant’s solicitors and the Respondents relevant to the orders sought in the Notice of Motion,

...

c. A copy of the inference schedule filed by the respondents in relation to the "Cox v Railton " claim that the respondents make against the Applicant,

...

e. A copy of various documents extracted from the files maintained by the First Accounting Firm and which, I believe, were among the documents produced by the First Accounting Firm to the Second Respondent (ACC) as a consequence of a Notice issued to that firm under s 29 of the ACC Act dated 22 September 2005. To the extent that any of these documents contain information subject to legal professional privilege, that privilege is not waived by the exhibiting of these documents to this affidavit.

Evidently, the purpose of these exhibits was to lay the factual groundwork for a submission that, so far as the applicant was able to demonstrate, the documents thus far discovered by the Commission did not establish the crime or fraud exception, and that further discovery was required. I note without further comment at this stage that the documents in relation to which the applicant presses for a s 50 order are the inference schedule (part c. of the exhibit) and certain documents from the accountants (within the bundle in part e. of the exhibit).

16 The applicant’s motion for further and better discovery came on for hearing on 19 May 2008. It seems that the applicant came to court that day under the reasonable apprehension that the Commission would support – or at least would not oppose – the making of s 50 orders with respect at least to part of the material exhibited to Mr Rydon’s affidavit of 13 February 2008. However, when the matter came on before Emmett J, counsel for the applicant informed his Honour that counsel for the Commission had just informed him that the Commission opposed the making of any such order, and proposed to move for the vacation of previous s 50 orders. This left counsel for the applicant in some difficulty: he needed the evidence in the exhibit to support his client’s discovery application, but he had not come to court prepared to advance a full argument, over the opposition of the Commission, as to why a s 50 order should be made.

17 The solution adopted to this dilemma was a pragmatic one. It attracted the support of counsel for the Commission and of Emmett J. A s 50 order was made purely to maintain the status quo, as it were, so that the hearing of the applicant’s discovery motion could go ahead without embarrassment. The questions whether the order ought to have been made, and of whether the other s 50 orders should be vacated, were deferred to a later occasion. In the course of the hearing when these matters were discussed, counsel for the applicant said:

In my respectful submission, to enable this morning to go forward and to protect the interests of the parties, your Honour ought make a confidentiality order of the kind that I respectfully urge upon you. It can be limited until further order given that Mr Game foreshadows apparently an application to undo all of the confidentiality orders, including in relation to the name and plans, so that today can proceed and then if, in due course, my friend brings on his application, the court can revisit the question of confidentiality in globo.

Counsel for the Commission said that "a time must come as it were when confidentiality in relation to this case ceases to be of any meaning" but suggested that, for that day’s purposes, certain things in the documents could be masked. The following exchange then occurred between Emmett J and counsel for the Commission:

MR GAME: ... Beyond that, your Honour, I think it would probably be taking more of the court’s time up in resolving this issue than simply making the orders preserved in the status quo, but I suppose at this point it’s best that Mr Kunc and his client understands that our position has changed in relation to this issue. HIS HONOUR: Well, I’d understand that, but I do follow from what you have just said that for the moment you wouldn’t oppose the making of this order until such time as the whole matter can be revisited? MR GAME: Well, let me put it this way, your Honour; I would understand and find it difficult to resist that the orders would be maintained until such time as the larger question was maintained, so I stood up to oppose but having heard what Mr Kunc said it seems difficult for the – the issue should really be dealt with in one go by your Honour I would have thought. HIS HONOUR: Well, I agree and with proper evidence to show why confidentiality is necessary and what harm is likely to follow from it. MR GAME: Yes. So I didn’t mean to do a 180, but I do see the problem with masking, yes, so --- HIS HONOUR: Always. Well, the --- MR GAME: I don’t see any harm in the status quo being maintained for the --- HIS HONOUR: At least for a short time anyway.

In the result, his Honour made the following order:

Pursuant to s 50 of the Federal Court of Australia Act (the Act): (a) publication of Sections A, C, E and pages 100-110 (inclusive) of Exhibit DPR1 to the Affidavit of David Peter Rydon affirmed on 13 February 2008 and the Outline of Submissions of the Applicant dated 9 April 2008 be restricted to the parties and their legal advisers; (b) any reference to the names and terms set out in Confidential Exhibit 1 to these orders made in the course of today’s hearing and Confidential Exhibit 1 itself not be published to any persons other than the parties and their legal advisers or for the purpose of informing any person of the terms of these orders; and (c) any reference to the names and terms set out in Confidential Exhibit 1 to these orders in the transcript of today’s hearing be redacted by being blanked out from that transcript.

18 The applicant had a measure of success in his discovery motion heard by Emmett J on 19 May 2008. On that day, his Honour ordered the Commission to conduct a further review of the documents in its possession, and to assess each document with respect to relevance and to its tendency to affect adversely, or to support, any allegation made in the inference schedule. His Honour also directed the applicant to file any motion he had for the making of the s 50 orders and to serve (but not to file) his affidavits in support. Before that could happen, however, on 1 July 2008, the Commission abandoned its reliance on the crime or fraud exception and requested the court to re-list the proceeding for the purpose of making final orders. The proceeding was listed on 4 July 2008. Orders were made by consent for the return to the applicant of the documents in dispute and for the deletion of any reference to them from the Commission’s records. The discovery orders made on 19 May 2008 were vacated.

19 Relevantly to the present matter, the next thing that happened was the filing by the applicant of a Notice of Motion on 15 July 2008. The applicant thereby gave notice that he would move for orders that, "notwithstanding the disposal of these proceedings, the orders made under section 50 ... remain in force in relation to ..." certain material, including that presently contentious. On 24 July 2008, the Commission filed a Notice of Motion for orders under s 50 which would keep certain documents confidential, not including the presently contentious ones. Then on 5 August 2008, the interveners filed a Notice of Motion for the vacation of all s 50 orders previously made in the proceeding. Those three Notices of Motion came before Emmett J on 20 and 21 August 2008.

20 On 21 August 2008, Emmett J vacated the orders previously made under s 50. However, at the same time his Honour made the order referred to in par 1 above. On 29 August 2008, his Honour published reasons, and made further orders, in relation to the three Notices of Motion that had been before him on 20 and 21 August. He vacated all then current orders made under s 50. As previously indicated, those orders included the order that there be no publication of the documents behind Tabs C and E of Exhibit DPR1 to Mr Rydon’s affidavit of 13 February 2008. The applicant contends that Emmett J was in error to have taken that step. Before turning to the applicant’s submissions in that regard, I should say something about his Honour’s reasons delivered on 29 August 2008.

21 His Honour referred to the terms of s 50 itself (which I set out below at par 38). He referred to the test required to be applied under s 50, namely, whether an order was necessary to prevent prejudice to the administration of justice, which his Honour identified as, "prejudice in respect of the exercise by the court of the judicial power of the Commonwealth". His Honour said that it could be an unfortunate incident of the open administration of justice that embarrassing, damaging and even dangerous facts may occasionally be disclosed. He accepted that, if the embarrassment or damage that publicity might occasion was such that it would prevent or deter a person from prosecuting or defending a proceeding in the court – or if there was a real risk that that would occur – the position might be different. If such a situation arose, his Honour considered that it would need to be weighed in the discretionary balance which was to be struck between the public interest in open justice and preventing prejudice to the administration of justice. In his Honour’s view, the case before him was not of that category.

22 Although recognising that open justice was the underlying assumption of s 50, his Honour said that the section was not concerned with a need to preserve open justice. Rather, the expression "preventing prejudice to the administration of justice" was a reference to the public interest in the court’s endeavouring to do justice between the parties. While recognising that the derogation from the principle of open justice involved in the making of an order under s 50 may be very great, his Honour said that it would not necessarily be so in all cases and, in the exercise of the court’s discretion, the degree of derogation involved in a particular order was a matter proper to be considered.

23 His Honour next referred to affidavit evidence given before him by Mr Rydon to the effect that he had conducted the proceeding, and had caused the contentious documents to be exhibited to his affidavit of 13 February 2008, on the understanding that those documents would be kept confidential, consistently with the pattern of s 50 orders which had previously been made with the common assent of both parties. In the absence of such an understanding, Mr Rydon made it clear that the documents either would not have been used at all, or would have been exhibited only in a redacted form. His Honour referred also to a submission then made on behalf of the applicant that the proceeding itself arose in the context of "a series of secret inquisitorial steps" that were contemplated by the ACC Act. The very point of the proceeding was to assert a claim of privilege in relation to those documents, and the point of the affidavit of 13 February 2008 was to deal, in one respect at least, with an assertion that the documents had been brought into existence in furtherance of a crime, fraud or other impropriety, an assertion which had since been abandoned by the Commission.

24 His Honour next referred to the submission made on behalf of the applicant that, unless the contentious documents were kept confidential, it would be possible for any member of the public to use them as a basis to delve into the applicant’s personal, financial and taxation affairs to an extent that was inconsistent with what would otherwise be his right to maintain confidentiality in relation to those affairs. This would, it was submitted, be a particular concern "in the age of the internet and other electronic research". It was submitted on behalf of the applicant that material otherwise available to the public ought to satisfy the public interest in open justice, without destroying the applicant’s right to preserve confidentiality in relevant respects. As to his last submission, his Honour said that it reversed the correct approach. He said that the question was not whether the public had access to sufficient information to enable it to understand the nature and outcome of the proceeding, but was, rather, whether, once material had been introduced into evidence, it was necessary, in order to prevent prejudice to the administration of justice, that that material not be made available to the public.

25 His Honour noted that the applicant had not "adduced evidence that any specific damage or prejudice would be occasioned or might be occasioned by the disclosure of the material in question". He noted that the applicant’s case was based on the circumstance that the material included private and confidential information that he would not have tendered, or permitted to be admitted into evidence, had he known that it might become public.

26 His Honour next referred to the position of the Commission, and to the circumstance that the s 50 orders had been made with the common assent of the parties. He referred to the distinction which the Commission had maintained between material that had, and material that had not, been tendered. He noted that the need for confidentiality, arising from the integrity and secrecy of the Commission’s investigation, "was limited temporily". His Honour accepted that the contentious documents might well have been exhibited in the expectation that an order under s 50 would be made, but said that it was "entirely a matter for the court" whether any such order should in fact be made. It was not a matter for agreement between the parties, and his Honour considered that a situation, short of agreement, in which the applicant’s solicitor merely proceeded on an assumption that a s 50 order would be made was an a fortiori case.

27 Turning to the particular documents which are in issue on the present application, his Honour commenced with those behind Tab E of Mr Rydon’s Exhibit, namely, confidential documents produced by the accountants in response to the Commission’s notice. His Honour said:

It has not been suggested that disclosure of the material in part E would cause particular or specific harm or damage to the applicant, other than possible embarrassment and inconvenience by reason of his private affairs’ becoming public. I do not consider that the applicant has advanced any cogent reason for the Court to conclude that it is necessary, in order to prevent prejudice to the administration of justice, that publication of the documents in part E be restricted in any way. I accept that it is was the Commission’s allegation, that there were reasonable grounds for believing that the privileged documents were brought into existence in the furtherance of a fraud or the commission of an offence, that prompted the applicant to tender the evidence in connection with the interlocutory dispute concerning discovery. Further, I accept that the documents in part E were tendered and received into evidence in circumstances where there was an order under s 50 in force in relation to the evidence. However, the s 50 order was only ever operative until further order by the Court. Further, as I have said, it was made at the behest of the Commission, in order to preserve the integrity of the Commission’s special investigation. Now that that integrity is no longer at risk, there is no longer any justification for a continuing departure from the primary assumption that proceedings in the Court are conducted in public.

28 His Honour then turned to the inference schedule. In this respect, his Honour’s conclusion was as follows:

Ultimately, I consider that this material is in the same position as the material in part E. That is to say, I do not consider that the applicant has established that it was only because of the expectation that s 50 orders would continue in perpetuity that the other material in question was tendered. It would be fair to conclude that the applicant’s decision to adduce evidence was driven by the object of succeeding in his application against the Commission. It is difficult to see how the proceeding could have been prosecuted otherwise than by tender of the material in question. In the absence of the material, it would have been well nigh impossible for the Court to understand what the issue was. The Court directed the Commission to particularise its assertion that there were reasonable grounds for believing that the privileged documents in dispute had been brought into existence in the furtherance of a fraud or commission of an offence. There is no evidence to suggest that the Commission was motivated by bad faith of some sort.

29 His Honour concluded his reasons in the following terms:

I do not consider that any basis has been established on behalf of the applicant for the continuation of any order under s 50. The orders were made for the purposes of protecting the integrity of the Commission’s fresh investigations. Whether or not that was a justifiable basis for making such orders is not presently in question. The only question is whether there should continue to be an order in force prohibiting the publication of material that was in evidence before the Court, apart from the documents that have been found to be the subject of legal professional privilege.

30 In support of the present application for leave to appeal, Mr Rydon caused an affidavit affirmed by him on 7 October 2008 to be filed. Under the heading, "Why Leave Should be Granted", Mr Rydon said:

If leave is not granted then the Applicant will be deprived of the opportunity of appellate review of an order which in form may be interlocutory but is final in its effect. The reason it is final in its effect is that the vacation of the relevant order under s 50 of the Act will mean that the confidentiality of the information which is the subject of that order will be lost. The Applicant submits that the decision of the primary judge in relation to vacating Order 4 made by him on 21 August 2008 is attended by sufficient doubt so as to warrant leave to appeal being granted.

Exhibited to this affidavit was a draft Notice of Appeal. That notice contained one ground only, namely, that "the primary Judge erred in setting aside order 4 made by him on 21 August 2008". No particulars of that allegation were provided, and there was no further elaboration.

31 Notwithstanding the deficiencies in the draft Notice of Appeal to which I have referred, in an outline of submissions filed on his behalf on 25 February 2009, the applicant identified the following grounds of appeal upon which he proposed to rely:

(a) His Honour failed to give any, or any adequate, weight to the fact that the material was inherently confidential and had been deployed in circumstances of confidentiality in relation to an investigation the details of which were themselves confidential ("the First Ground"). (b) His Honour placed excessive emphasis on the requirement for open justice over and against the destructive effect of the failure to maintain confidentiality in the material, particularly failing to give any, or any adequate weight to the fact that the part of the proceedings in which the material had been deployed was interlocutory and had subsequently been abandoned by the Respondents ("the Second Ground"). (c) His Honour failed to deal adequately with the question of whether whatever had changed since the time the orders had been made was sufficient to justify a variation of the status quo ante ("the Third Ground"). (d) The outcome in relation to the material the subject of the appeal was unjust and unreasonable ("the Fourth Ground").

32 In support of the first ground, counsel for the applicant pointed to a number of passages in the reasons of Emmett J that indicated that his Honour had not recognised that the contentious material was "inherently confidential". Counsel referred to his Honour’s comment that the applicant had not adduced evidence that any specific damage or prejudice would or might be occasioned by disclosure of the material. He referred to his Honour’s comment that the present was not a case like Australian Broadcasting Commission v Parish [1980] FCA 33; (1980) 29 ALR 228 where the failure to make an order would lead to the destruction of the very subject matter of the proceeding. He submitted that the very object of the present proceeding was to assert privilege in relation to the documents produced by the accountants, and if confidentiality were not maintained there would in effect be nothing left with respect to which such an assertion would be relevant. And counsel finally submitted in this respect that a number of passages in his Honour’s reasons bespoke an approach in which there was, in effect, a rebuttable presumption of open justice and in which a heavy onus was placed upon the applicant to have the s 50 orders maintained. Counsel submitted here that his Honour had paid no more than lip service to the balancing exercise required under s 50, and had "set the bar too high" for the applicant to cross in relevant respects.

33 In the way the second ground was developed in argument, the focus was upon the procedural circumstances which led to the reading of the relevant paragraphs in, and to reliance on the relevant exhibits to, Mr Rydon’s affidavit on 19 May 2008. Counsel for the applicant referred to the history of the making of s 50 orders in the proceeding before Emmett J, and to the evidence of Mr Rydon that he would not have caused the material to be used in court save on the assumption that he reasonably made that that material would, if so used, be protected by a s 50 order, as had been the case with like material previously relied on by both sides. It was submitted that Emmett J did not, in the exercise of his discretion, give sufficient weight to the considerable injustice that would be involved in the vacation of the s 50 order made on 21 May 2008: having effectively no alternative but to rely on the contentious material in order to prosecute his claim for further and better discovery on the crime or fraud exception, having done so in the context of a regime of confidentiality orders previously made, and then being confronted with two tactical volte face on the part of the Commission – its last-minute resiling from the position that s 50 orders were appropriate in the case and its even later-minute abandonment of any reliance on the exception – the applicant was left in the impossible position of having to carry the case for the making of a s 50 order. It was submitted that the procedural history of the proceeding, and the conduct of the Commission, strongly pointed to the making of a s 50 order, yet his Honour gave no weight to such considerations. These submissions of injustice also effectively constituted the arguments made on behalf of the applicant in support of his fourth ground.

34 Counsel for the applicant developed his client’s third ground by pointing to what Emmett J had said in the passage set out at par 29 above. As so expressed, the ground involved a degree of overlap with the first and second grounds. It was submitted that his Honour erred by approaching the matter as though the only question were whether the documents in issue should be protected by a s 50 order, and by failing to require some legitimate basis for disturbing the then existing status quo whereby such protection had been granted and had subsisted since the proceeding had been commenced. It was not sufficient that the Commission had changed its position.

35 On an application for leave to appeal such as the present one, two questions arise for consideration: is the decision below attended with sufficient doubt to warrant its being reconsidered by the Full Court, and would substantial injustice result if leave to appeal were refused, supposing the decision to be wrong: Decor Corporation Pty Ltd v Dart Industries Inc [1991] FCA 655; (1991) 33 FCR 397, 398-399. In the present case, the decision below involved the exercise of a judicial discretion. Such a decision will be disturbed on appeal only in accordance with the principles stated in House v R [1936] HCA 40; (1936) 55 CLR 499, 504-505:

The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred.

In a case such as the present, therefore, the inquiry whether the decision below was attended by "sufficient doubt" resolves into the question whether there is a sufficient prospect that Emmett J erred in one of the respects referred to in House v R to warrant his Honour’s decision being reconsidered by the Full Court. From a practical point of view, it may be thought that there is a little artificiality about such an approach, since we have, as a Full Court, heard full argument on the merits of the applicant’s intended appeal, against the prospect that leave to appeal would be granted. But, from a jurisprudential point of view, it is important to proceed in accordance with the staged approach referred to in Decor.

36 On the hearing of the application for leave, the question arose whether the interlocutory judgment being challenged dealt with a matter of practice or procedure. If so, the court should be especially cautious about interfering with the exercise of the discretion involved in that judgment: In re the Will of FB Gilbert (dec) (1946) 46 SR (NSW) 318, 323; Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc [1981] HCA 39; (1981) 148 CLR 170, 177. Counsel for the applicant submitted that the matter of making, or refusing to make, an order under s 50 was not one of practice or procedure, relying in this respect upon what Branson J said in Johnston v Cameron [2002] FCAFC 251; (2002) 124 FCR 160, 163 [8]:

This is not a case in which the exercise by the primary judge of a discretion with respect to a point of practice and procedure is sought to be challenged. Rather, his Honour's decision, if allowed to stand, will have the practical effect of determining the claim of the applicant to be entitled to an order under s 50 of the Federal Court Act. Leave to appeal is more readily granted in a case of this kind than in a case concerning practice and procedure only (Decor Corporation at 400; Minogue v Williams [2000] FCA 125; (2000) 60 ALD 366 at 371 [19]).

The other members of the Full Court on that occasion did not deal specifically with the point, although it may be said that nothing in the separate judgments of Tamberlin and Finkelstein JJ bespeaks a more rigorous approach to the question of a challenge to the exercise of a discretion under s 50 than would be appropriate to a case in which the decision under challenge affected substantive rights. As against this, in Parish Franki J said that the s 50 matter with which the Full Court was then concerned "in one sense ... [was] not determinative of substantive legal rights", (29 ALR at 244) and Deane J, although in dissent, said that the decision whether to make a s 50 order was "a decision as to practice and procedure" (29 ALR at 256). The views of Franki and Deane JJ have, in my respectful view, much to commend them. With respect to Branson J, there is, I consider, a view that the very subject-matter with which s 50 deals is of itself procedural, and that it begs the question to propose that the matter of making, or refusing to make, an order under the section was a substantive one because it would determine the party’s claim for such an order. However, counsel for the interveners did not argue that the present was in the category of cases with which The Will of Gilbert and Adam P Brown were concerned, in which circumstances I am prepared to approach the matter as though it involves the exercise of a judicial discretion on a matter which affects substantive rights. As will be apparent, however, I have reservations as to the correctness of the position stated by Branson J in Johnston v Cameron, and would not want the approach which, as indicated, I am prepared to take on this occasion to be read as an endorsement of that position.

37 One way or another, the applicant’s case on the application for leave to appeal identifies the following general respects in which, it is submitted, Emmett J erred:

(a) by failing to recognise the distinct procedural history of the matter, and the circumstances under which the contentious documents came to be relied on in evidence on 19 May 2008;

(b) by failing to recognise the inherently confidential nature of the documents in question, and their relationship to the applicant’s claim of privilege in relation to them;

(c) by failing to give weight to the circumstance that, by the time his Honour came to give judgment on 29 August 2008, the Commission’s reliance on the crime or fraud exception had been abandoned and the purpose of the forensic use of the contentious documents was in effect spent; and

(d) by failing to undertake a genuine balancing exercise of the kind referred to in Parish.
I propose to approach the question of "sufficient doubt" by reference to these categories.

38 By way of preliminary, however, it is necessary to consider the terms of s 50 itself. The section reads as follows:

The Court may, at any time during or after the hearing of a proceeding in the Court, make such order forbidding or restricting the publication of particular evidence, or the name of a party or witness, as appears to the Court to be necessary in order to prevent prejudice to the administration of justice or the security of the Commonwealth.

Subject possibly to the implications of the circumstance that a number of s 50 orders had previously been made in the present case, and Emmett J was concerned with whether they should be vacated, the question before his Honour was whether it was necessary in order to prevent prejudice to the administration of justice for a non-publication order to be made (or continued) in relation to the documents presently in contention. It was not submitted on behalf of the applicant that his Honour had not addressed, or had misunderstood, this question. No such submission could credibly have been made in the circumstances: it is as clear as may be that his Honour gave conscious attention to the terms of the section, and decided the matter before him by reference to them.

39 Turning then to the first general category of alleged error identified above, it is here that an understanding of the matter which was before Emmett J is important. Although many s 50 orders had been made down to 19 May 2008, before the presently material order was made on that day, the Commission announced its opposition to the making of any further such orders. That was a departure from the course previously followed by the Commission, but it occurred clearly and unequivocally, and, critically for present purposes, it occurred before counsel for the applicant had read to the court the paragraphs of Mr Rydon’s affidavit to which the presently contentious documents were exhibited, and before those documents were relied on. On the making of that announcement, the applicant might have followed one of several courses, but the one adopted involved reading the affidavit, and relying on the documents, under cover of a holding order which went no further than to maintain the status quo. Quite clearly, the course adopted did not involve any presumption, or prima facie position, that a permanent s 50 order would ultimately be made, and was, and is, inconsistent with Mr Rydon’s later assertion that he caused the material to be used in court only because of an assumption that it would be, and would remain, protected from publication by a permanent order of that kind.

40 The procedural setting to which I have referred was recognised by Emmett J, although perhaps not articulated as specifically as I have. His Honour said:

It may be that, in the expectation that orders under s 50 would be made, material in an unredacted form was included in affidavits and exhibits filed on behalf of the applicant. However, it is entirely a matter for the Court, having regard to the criteria set out in s 50, whether any order restricting publication or disclosure of evidence should be made. It is not a matter for agreement between parties as to whether an order under s 50 will be made or, assuming an order is made, whether a subsequent order might be made varying or discharging the order. A fortiori, the fact that the applicant’s solicitor proceeded on an assumption that a restriction on the publication of evidence may be permanent is of no consequence unless, perhaps, the evidence was tendered in circumstances where the Court was informed that, unless a permanent order were made, the evidence would not be tendered. As I have said, questions of fairness may then possibly arise. However, the applicant does not put his case on that basis. In either event, ultimately it is a matter for the Court, in the light of the criteria specified in s 50, to determine whether an order should be made and whether an order, having been made, should be discharged or varied.

I do not consider it to be legitimately arguable that his Honour erred in the approach which he took. That approach involved no predisposition towards the continuation of the order made on 19 May 2008. It recognised that the applicant had made his own call, as it were, as to how he desired to proceed on that day, and had used the contentious material in his case in court in the full understanding that no such predisposition would be shown by the court.

41 Turning to the second general category of alleged error, one should commence by acknowledging that legal professional privilege was not the basis upon which the contentious documents were or are sought to be protected. The inference schedule was a document prepared by the Commission and could not be the privileged document of the applicant. The documents from the accountants might have been privileged, and if so Mr Rydon sought to preserve it in the extract from his affidavit of 13 February 2008 to which I have referred in par 15 above. However, privilege as such was not the ground upon which a s 50 order was sought in relation to these documents. Indeed, Emmett J ordered that documents on the court file which were the subject of legal professional privilege be returned to the applicant.

42 How, then, does the applicant assert that the contentious documents were, and remain, inherently confidential? It is true that, generally speaking, every person has a right to keep from the view of others, or of the world at large, documents and things which he or she regards as his or her private concern. But so to propose is no more, in my view, than to state a conclusion about the absence of a right in any other person to view such documents and things. There are, of course, all manner of situations in which a claim to keep a particular document confidential will be recognised by a court. For example, equity recognises that the information contained in certain documents is, of its nature and by reason of the circumstances of its communication, subject to a duty of confidence. So too will the law protect trade secrets in well-recognised situations. And it is commonly the case that the court will protect from the public eye personal or commercial information the value of which as an asset would be seriously compromised by disclosure. In this latter category, the source of the jurisdiction (in this court) to provide such protection is s 50 itself. That is to say, the question will always be: is an order necessary to prevent prejudice to the administration of justice? Absent an affirmative answer to this question it is, in my view, almost meaningless to propose that documents themselves are, or that the information in them is, inherently confidential to an extent justifying, or assisting in the justification of, the making of an order permanently protecting them from public view.

43 It is convenient here to refer to a passage in the reasons of Emmett J of which the applicant was critical. His Honour said:

Open justice is the underlying assumption of s 50. However, the reference to preventing prejudice to the administration of justice is not a reference to the need to preserve open justice. Rather, it is a reference to the public interest in the Court’s endeavouring to do justice between the parties. It is not possible to define, in advance, the degree of prejudice to the administration of justice that would justify the making of an order under s 50. Where, for example, failure to make an order would lead to the destruction of the very subject matter of the suit, the exercise of the discretion may well be appropriate, since the refusal to make an order in such a case could well defeat the purpose of achieving justice between the parties and thereby disappoint the public interest in having the Court deal responsibly with the confidential affairs of parties (see Australian Broadcasting Commission v Parish [1980] FCA 33; (1980) 29 ALR 228 at 234). Again, that is not this case.

Counsel for the applicant submitted that his Honour was wrong to opine that the case before him was not on all fours with Parish. Here it is useful to consider the facts of Parish. The Australian Cricket Board had entered into an agreement with certain media organisations with respect to the promotion of cricket and other matters. The Australian Broadcasting Commission claimed that, in some respects, the agreement was in contravention of s 45 of the Trade Practices Act 1974 (Cth). The Board sought an order under s 50 in relation to the agreement. It was unsuccessful before Brennan J, but succeeded on appeal (per Bowen CJ and Franki J, Deane J dissenting). Bowen CJ said (29 ALR at 234-235):

If the ABC is successful at the trial in showing the agreement is contrary to the Trade Practices Act, the agreement will fall to the ground and the question of confidentiality with it. If the ABC is unsuccessful, then the respondents ought to be able to expect to continue under an agreement which remains with its efficacy and value not destroyed or seriously damaged by the proceedings themselves. The learned trial judge reached the following conclusion: "... the dissemination of the contents of the confidential parts of the agreement will, according to the evidence, seriously weaken the negotiating strength of the Board and may well require the respondents (appellants) to reconsider their adherence to the agreement." While falling short of a finding that disclosure of the confidential parts will destroy the efficacy or value of the agreement, this conclusion comes not far short of that. The position appears to me to be analogous to the position in those cases where confidential information is the subject-matter of the proceedings. It is in the interests of the administration of justice that the very proceedings before the court should not be permitted to destroy or seriously depreciate the value of such confidential information. If it were otherwise, not only might the parties and members of the public consider the court was not paying proper regard to confidentiality but also it might open the way to abuse.

Franki J said (29 ALR at 244-245):

In my opinion his Honour, in the passage just cited, is not paying due regard to the importance of doing justice between the parties. His Honour also found upon the evidence, after saying that he accepted the evidence of Mr Parish and Mr Taylor as entirely truthful and that the concern which they expressed about the effect of confidentiality was honestly held, that the dissemination of the contents of the confidential parts of the agreement would, according to the evidence, seriously weaken the negotiating strength of the Board...

44 As is apparent from the foregoing, Parish was a case in which the Board had an agreement which was, as a matter of fact, confidential as between the parties. Indeed, it was all but held by Bowen CJ and Franki J that the efficacy of the agreement as such was in no small measure dependent on it remaining confidential. The Board then became a respondent in an action brought by the Broadcasting Commission to challenge the legality of the agreement. Evidently their Honours took the view that it would be prejudicial to the administration of justice if, regardless of the merits of the case, the forensic process itself had the practical effect of compromising the commercial value of the agreement. It is quite clear that the present case is not on all fours with Parish, when so understood. The subject-matter of the present case was the applicant’s assertion that documents produced by the accountants to the Commission were privileged. That claim was resolved, in part by his Honour’s "prima facie" ruling and in part by the Commission’s abandonment of its original reliance on the crime or fraud exception. The proceeding served the applicant’s purpose of avoiding the disclosure of privileged material. As I have said, questions of privilege do not arise in relation to the documents which are presently contentious. The absence of a continuing s 50 order will not, therefore, in the respects discussed in Parish, be prejudicial to the administration of justice.

45 Returning to the reasons of Emmett J, the passage set out at par 43 above is based upon the following part of the reasons of Bowen CJ in Parish (29 ALR at 234):

The case where failure to make an order under s 50 would lead to the destruction of the very subject-matter of the suit would seem to be the kind of case which might ordinarily attract the exercise of the discretion. The refusal to make an order in such a case might well defeat the purpose of achieving justice between the parties and disappoint the public interest in having the court deal responsibly with the confidential affairs of citizens.

For reasons which I have attempted to explain, Emmett J was correct to conclude that the present was not such a case.

46 The other dimension of the point presently under discussion is that which links the nature of the material with the purpose for which it was deployed in the hearing before Emmett J on 19 May 2008. Here I accept that the starting point is that the documents in contention were of their nature such as the applicant would want to keep private, and legitimately so. However, the fact is that the applicant exhibited those documents to an affidavit read in court and which he used to his own advantage. It is at this point that the applicant points to the purpose of him proceeding that way. It is put on his behalf that he was engaged in an endeavour to ward off claims – which were ultimately shown to be baseless – that (other) documents produced by the accountants were created in furtherance of a crime, fraud or impropriety. He had no choice but to use the contentious documents for that purpose. It could not be correct, it was submitted, that the price which the applicant was required to pay for his success in that endeavour was the loss of the private status of the documents on which he was obliged to rely and the public embarrassment which might be expected to result therefrom.

47 An analysis of the position in which the applicant found himself on 19 May 2008 should not, in my view, be distracted by the circumstance that the claim being made by him was by way of an assertion of the privileged status of the documents produced by the accountants. The fact is that the applicant had a cause of action which was most important to him. At some point his case involved the use of documents which he would, in other circumstances, never have exposed to public view. He would not have been the first, and is unlikely to be the last, litigant who is faced with a choice of this kind. There was, in my view, nothing in the nature of the particular case being advanced by the applicant (the assertion of legal professional privilege) that elevated the merit of his claim for a s 50 order to a position higher than that which would be occupied by the merit of a similar claim in litigation generally.

48 Critically for present purposes, the question is whether Emmett J failed, in the exercise of his discretion, to appreciate the force of the case which the applicant put in this regard. It is clear that his Honour did not. As noted earlier in these reasons, his Honour observed that "[i]t can be an unfortunate incident of the open administration of justice that embarrassing, damaging and even dangerous facts may occasionally be disclosed". His Honour observed that the applicant was a prominent figure, and that it was put on his behalf that the absence of a s 50 order "would permit delving into his personal, financial and taxation affairs in a way that is inconsistent with what would otherwise be his right to maintain confidentiality in relation to those affairs". His Honour also acknowledged (in the passage set out at par 28 above) that it was "difficult to see how the proceeding could have been prosecuted otherwise than by tender of the material in question". In other words, his Honour was keenly alive to the dilemma which faced the applicant at the time when he was obliged to decide whether to tender that material. He placed those kinds of considerations fairly on the scales. However, instructed as he was by the terms of s 50, he took the view that it had not been shown to be prejudicial to the administration of justice to withhold the making of an order such as the applicant sought. In these respects, it is impossible to find in his Honour’s reasons any error of the kind referred to in House v R.

49 The third general category of alleged error may be dealt with shortly. It has not been established that his Honour did fail to take into account the stage the proceedings had reached by the time he heard the applicant’s motion for a s 50 order in August 2008. He was clearly alive to the significance, in the applicant’s case, of the abandonment by the Commission of any reliance on the crime or fraud exception. Besides, it was not for the interveners (for instance) to establish the existence of some ongoing tendency of public disclosure to serve the interests of justice: the question was whether it had been established by the applicant that protection from publication was necessary (not merely desirable) to prevent prejudice to the administration of justice. His Honour below saw the question in these terms, and held that an affirmative answer was not indicated by the circumstance that the purpose of the introduction of the contentious documents into evidence (whether on its own or in combination with other factors) had, at the time he came to give his ruling on the matter, been spent. Not only am I unable to perceive any House v R error in the approach which his Honour took: I consider, with respect, that the approach was self-evidently the correct one to take in all the circumstances.

50 In contending that Emmett J had made errors of the kind referred to in the fourth general category to which I have referred, counsel for the applicant pointed to a number of passages in his Honour’s reasons where his Honour had, it was submitted, effectively set the bar too high for the applicant in his quest for a s 50 order. It was said that his Honour approached the matter as though the principle of open justice was entrenched, and then asked himself whether the applicant had done enough to displace it. Counsel pointed to his Honour’s observation that the applicant had not adduced evidence that any specific damage or prejudice would or might be occasioned by the disclosure of the material, as though there were an onus on the applicant to establish a proposition of that kind. His Honour’s treatment of Mr Rydon’s evidence – that he would not have caused the material to be introduced into evidence if he had not had a basis to assume that it would not be made public – was said to be an instance of his Honour setting the bar too high. These and other indications were said to bespeak an erroneous approach to what ought to have been a balancing exercise, as propounded in Parish.

51 Far from being the source of error on the part of his Honour, I consider that the obligation to "balance" various considerations in dealing with an application for a s 50 order is almost a non-issue on the facts of the present case. Any suggestion that the question whether an order should be made is from the start evenly balanced could not stand alongside the terms of the section itself. As Parish makes clear, the assumption underlying the section is that normally the jurisdiction of the court will be exercised in public. Indeed, s 17(1) of the Federal Court Act so requires. Section 50 provides for an exception. A party who invokes it is seeking to displace the normal with the exceptional. He or she must make out his or her case against the criteria referred to in the section. That requires the court to be satisfied that it is necessary for such an order to be made in order to prevent prejudice to the administration of justice. There is indeed a bar to be crossed here – any attempt to pretend otherwise would be to ignore the very terms of s 50 itself. In my opinion, the approach which Emmett J took to the applicant’s application for an order – by which his Honour required himself to be satisfied of the things set out in the section – was unexceptionable.

52 The passage in Parish which seemingly prompted the applicant to contend that his Honour had not adopted the "balancing" approach was the following, in the judgment of Bowen CJ (29 ALR at 234):

Section 50 says the court may make such order forbidding or restricting publication of certain things as appears to the court to be necessary in order to prevent prejudice to the administration of justice. In exercising this discretion, I am of opinion the court should also take into account what s 50 does not mention in terms but what is the underlying assumption upon which it is based, namely, the principle of open justice. The English language does not readily provide the means of describing the process by which this is taken into account. It is a process of judgment. A useful metaphor is that of weighing in the scales the various factors involved. It might be said the process is more complex than such a metaphor would suggest (see Science Research Council v Nasse, supra, at 771); but that metaphor is the best available. Weighing in the scales the countervailing public interests involved, the discretion whether or not an order should be made and upon what terms, has to be exercised.

His Honour the Chief Justice did not, however, imply that an applicant for a s 50 order did not still have to make out his or her case according to the statutory criterion. His Honour’s discussion of the discretionary process involved followed upon his definition of the problem in these terms (29 ALR at 234):

It is not possible to define in advance the degree of prejudice to the administration of justice, which will justify the making of an order under s 50. The collocation of the alternative phrase "security of the Commonwealth" suggests Parliament was not dealing with trivialities.

Then followed the passage I have set out in par 45 above. In other words, the Chief Justice’s approach was one which recognised the gravity of making an order that would derogate from the principle of open justice, but which recognised that the "degree of prejudice" involved in a particular case would have to be considered also, and in that sense weighed on the scales.

53 The applicant failed in the present case because Emmett J was not satisfied that the absence of an ongoing order under s 50 was necessary in order to prevent prejudice to the administration of justice. This involved matters of degree, evaluation and, therefore, of discretion. Although the case before his Honour did not reach the stage of Parish, where the Full Court was so satisfied, he nonetheless fairly considered each of the detriments advanced by the applicant as having a tendency to demonstrate that there was such a necessity. I can, with respect, perceive no want of balance demonstrated in the approach which his Honour took.

54 Before concluding on the question of sufficient doubt, I should mention one aspect of Emmett J’s reasons which was not initially challenged by the applicant, either in his draft Notice of Appeal or in his outline. At one point, his Honour said that the s 50 order sought to be maintained by the applicant "was made at the behest of the Commission". As will be apparent from what I have written above, that was not so. The order vacated by his Honour was made on 19 May 2008, and continued on 21 August 2008, at the behest of the applicant. At another point, his Honour said that the orders under s 50 "were made for the purposes of protecting the integrity of the Commission’s fresh investigations". Again, although that may have been true of the s 50 orders previously made at various stages of the proceeding, it was not true of the orders made on 19 May 2008 and 21 August 2008. At the hearing of his application for leave to appeal, the applicant sought to rely on these mistakes in his Honour’s reasons. I do not, however, consider that these inaccuracies relevantly affected the exercise of his Honour’s discretion adversely to the applicant. The crucial point which his Honour sought to make in each instance was that, although many s 50 orders had been made in the proceeding, they were made without adjudication because of the special interest in confidentiality then expressed by the Commission. By the time his Honour came to consider the applicant’s motion for the making of a permanent s 50 order, that interest was no longer pressed. Indeed, the Commission opposed any permanent regime of confidentiality in relation to the contentious documents. Although technically in error, I consider that these observations by his Honour went no further in point of substance than to draw attention to a circumstance which differentiated the position with which he was confronted on 20 and 21 August 2008 from that which had obtained previously.

55 For the above reasons, I am not persuaded that the judgment below is attended by sufficient doubt to warrant its reconsideration by the Full Court.

56 In the light of that conclusion, it is not strictly necessary to consider the matter of substantial injustice. However, I recognise that, in a case in which the answer to the question whether the decision under challenge was attended by sufficient doubt was less obvious than I consider the answer to be in the present case, the degree of injustice that would be worked upon the applicant, assuming the decision under challenge to be wrong, would be a relevant consideration. Save in the question-begging sense of potentially suffering the embarrassment associated with the disclosure of personal details sought to be kept confidential by the s 50 order itself, it is not easy to see what substantial injustice would arise if leave to appeal were refused in the present case. The cause of action on which the applicant sued would not be affected. The subject matter of the litigation – the claim to legal professional privilege – would not be endangered. No question of fact or law would thereby be determined, conclusively or at all, adversely to the applicant. If it were necessary in the present case to consider whether substantial injustice would arise in the absence of the grant of leave to appeal, I would be disposed to the view that it would not.

57 I take the view that the application for leave to appeal should be dismissed. However, since preparing the above reasons in draft, I have had the advantage of reading the reasons of Moore J, who agrees with Gilmour J that leave to appeal should be granted. On the assumption that leave will be granted, I consider that the appeal should be dismissed.

I certify that the preceding fifty-one (51) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jessup.

Associate:

Dated: 18 June 2009

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 1503 of 2008

ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:

PAUL HOGAN Appellant

AND:	AUSTRALIAN CRIME COMMISSION First Respondent THE CHIEF OFFICER OF THE AUSTRALIAN CRIME COMMISSION Second Respondent NATIONWIDE NEWS PTY LIMITED AND JOHN FAIRFAX PUBLICATIONS PTY LIMITED Interveners

JUDGE:	MOORE, JESSUP & GILMOUR JJ
DATE:	19 JUNE 2009
PLACE:	SYDNEY

REASONS FOR JUDGMENT

GILMOUR J:

58 The appellant is a well-known Australian actor. He appears to live mainly in the United States of America. He seeks leave to appeal from the interlocutory orders made by the primary judge on 29 August 2008 vacating all then current orders made under s 50 of the Federal Court of Australia Act 1976 (Cth) ("the Act") in the proceedings.

59 Section 50 relevantly provides that the Court may make such order forbidding or restricting publication of particular evidence as appears to the Court necessary in order to prevent prejudice to the administration of justice.

60 Nationwide News Pty Limited and John Fairfax Publications Pty Limited were granted leave to intervene in the proceedings.

61 This amounted to a dismissal of that part of the appellant’s motion filed on 15 July 2008 for orders to the effect that orders which had been made under s 50 remain in force in relation to the material and documents identified in a schedule annexed to the affidavit of the appellant’s solicitor sworn on 14 July 2008.

62 The orders, positively, that the then current order made under s 50 be vacated, were made on the motion, filed on 5 August 2008 by the Interveners.

Leave to appeal

63 The appellant filed a motion dated 11 September 2008 to stay the order of the primary judge of 29 August 2008 and for leave to appeal from that order. Foster J made orders on 12 September 2008 including an order staying the order of 29 August 2008 until further order of the Court or the Full Court as well as an order that the application for leave be referred to the Full Court.

64 The judgment appealed from is interlocutory. Accordingly, leave to appeal under s 24(1A) of the Act is required. The discretion is unfettered but will generally have regard, in its exercise, to the principles set out in Niemann v Electronic Industries Ltd [1978] VR 421 and Décor Corporation Pty Ltd v Dart Industries Inc [1991] FCA 655; (1991) 33 FCR 397. These are whether, in all the circumstances, the decision below is attended with sufficient doubt to warrant it being reconsidered by the Full Court and additionally whether substantial injustice would result if leave were refused, assuming the decision below to have been made erroneously. The Full Court considered an application for leave to appeal involving s 50 in Johnston v Cameron [2002] FCAFC 251; (2002) 124 FCR 160. Branson J observed at [8] that the application did not involve the exercise by the primary judge of a discretion in respect to a point of practice and procedure but rather a decision, which, if allowed to stand, would have the practical effect of determining the claim of the applicant to be entitled to an order under s 50 of the Act. Her Honour considered, correctly in my respectful opinion, that leave to appeal is more readily granted in a case of this kind than in a case concerning practice and procedure only: Décor Corporation at 400; Minogue v Williams [2000] FCA 125; (2000) 60 ALD 366 at 371 [19].

65 However, the judgment appealed from emanated from the exercise of discretion by the primary judge under s 50 of the Act. In such circumstances, assuming leave were granted, the Court would not interfere with his Honour’s exercise of discretion unless there were demonstrated error of the kind identified in House v The King [1936] HCA 40; (1936) 55 CLR 499 at 504-505; Australian Broadcasting Commission v Parish [1980] FCA 33; (1980) 29 ALR 228 at 232.

66 It is of course not sufficient that an appellate court might, on the material, have come to a different view from that of the primary judge.

67 The Court must be "satisfied" that the primary judge was "plainly wrong" before it will interfere with the exercise of a discretion on the basis of insufficient weight: Gronow v Gronow [1979] HCA 63; (1979) 144 CLR 513 per Stephen J at 519 and Aickin J at 534-5 and 537.

68 I am satisfied for the reasons which follow that the decision below is attended with sufficient doubt to warrant reconsideration by this Court and that substantial injustice would result to the appellant if leave to appeal were refused, assuming the judgment below to be wrong. Leave to appeal ought be granted.

Background

69 The following is an edited version of the background described by the primary judge.

70 The first respondent, the Australian Crime Commission ("the Commission"), is conducting a special investigation pursuant to a determination made by its Board under s 7C of the Australian Crime Commission Act 2002 (Cth) ("the Commission Act"). By notice dated 30 September 2005 ("the Notice"), issued pursuant to s 29 of the Commission Act, an international accounting firm with an office in Sydney ("the Accountants") was required to produce, to an officer of the Commission, documents described in the schedule to the Notice. The schedule referred to documents pertaining to a number of individuals and entities, including the appellant. The Accountants produced a number of documents to the Commission in compliance with the Notice.

71 The Notice contained a notation, pursuant to s 29A of the Commission Act, that prohibited the Accountants from disclosing the existence of the Notice or any official matter connected with it. However, the notation was subsequently varied to allow the Accountants to disclose the existence of the Notice to the appellant. The appellant instituted proceedings in this Court in February 2006, after he became aware that the Notice had been issued to the Accountants. The proceedings sought injunctive and other relief relating to the appellant’s claims to legal professional privilege in respect of communications contained in the documents produced by the Accountants to the Commission. The basis of that claim was that each of the disputed documents was prepared, or evidenced, a communication made, for the dominant purpose of the giving of instructions for, or the obtaining of, legal advice, or the provision of legal services, for or on behalf the appellant. Instructions for such advice were given by a consultant and the advice was furnished to the consultant. The consultant was originally the applicant in the proceeding.

72 Broadly, there were four phases of the proceedings which are described in the primary judge’s costs judgment: Hogan v Australian Crime Commission (No 4) [2008] FCA 1971 at [42]- [52].

73 In the first phase of the proceedings the appellant established that a number of documents seized by the Commission were prima facie privileged. In the course of the first phase a number of s 50 orders were made either at the request of the respondents or at the request of the appellants, supported, or not opposed, by the respondents. At the conclusion of the first phase the primary judge ruled that, at least until the resolution of the Commission’s special investigation into the appellant, and in order to preserve the secrecy and integrity of that investigation the regime of s 50 orders should remain in place: A3 v Australian Crime Commission (No 3) [2006] FCA 1143.

74 The second phase of the proceedings was devoted to the Commission’s contention that the documents were not privileged because they had been produced in furtherance of a crime or fraud and therefore subject to the exception to privilege articulated in Cox v Railton (1884) 14 BD 153. Evidence filed, but ultimately not read, by the respondents during this phase was made the subject of s 50 orders.

75 In the course of the second phase on 9 August 2007 the primary judge made orders against the Commission concerning its Cox v Railton contention:

1. By 6 September 2007 the Australian Crime Commission ("ACC") conduct reasonable enquiries and produce a list of documents (excluding transcripts), other than those which it reasonably believes are already in the possession of P or A3, which adversely affect the inferences which the ACC seeks the Court to draw in the Cox & Railton case.

2. By 6 September 2006 (sic) the ACC informs the Applicant if any person examined (with the exception of P or A3) gave evidence that adversely affects the inferences which the ACC seeks the Court to draw in the Cox & Railton Case.

76 The Commission in due course asserted that it had no documents or evidence which adversely affected the inferences which it sought to draw in its Cox v Railton case. The appellant then applied for further and better discovery. The application, although opposed, was successful. At the hearing of the appellant’s application for further and better discovery on 19 May 2008 the Commission indicated it no longer supported the regime of s 50 orders. Orders including the following were made on that day:

8. The Respondents by their solicitors repeat the review undertaken to comply with Orders 1 and 2 made on 9 August 2007 and in so doing assess each document:

(a) on the basis of whether or not it is relevant (in the sense referred to in the Evidence Act) to prove or disprove any allegation made in the Respondents’ inference schedule; and

(b) if it is so relevant: (i) identify whether on its face it adversely affects or supports any allegation made in the Respondent’s inference schedule; and (ii) if adverse, list that document on a list of documents to be produced to the Applicant.

9. The Respondents perform the task referred to in 8 mutatis mutandis in relation to Order 2 made on 9 August 2007.

10. On or before 1 July 2008 the Respondents serve the list referred to in 8(b)(ii) above and an affidavit setting out the steps and inquiries undertaken by the Respondent’s solicitors to review the documents and produce the list.

77 The third phase of the proceedings culminated in the judgment under appeal. It included the question of confidentiality in relation to the documents the subject of the privilege claim and the question of media access to material on the Court file.

78 The fourth phase was concerned with the substantive relief claimed by the appellant.

79 The Commission never complied with the orders numbered 8-10 made on 19 May 2008. Indeed prior to the hearing of the various applications in relation to the s 50 orders, the respondents abandoned the Cox v Railton point and the orders made on 19 May 2008 for further and better discovery were vacated.

Section 50 orders

80 When the proceeding was originally commenced, the consultant, mentioned previously, was referred to by the pseudonym "A3". Subsequently, the appellant, who has been referred to by the pseudonym "P", was joined as an applicant and, later, the consultant was removed as an applicant. Orders were made by the Court relieving both the consultant and the appellant from compliance with Order 4 rule 4(1)(a) of the Federal Court Rules, on the basis that sealed envelopes, marked "NOT TO BE OPENED UNTIL FURTHER ORDER OF THE COURT" and containing the respective names and addresses of the consultant and the appellant, would be filed with the Court. The Court also ordered, pursuant to s 50, that publication of the names and addresses of the consultant and the appellant be forbidden and that, until further order, the consultant and the appellant be referred to respectively by the pseudonyms. In addition, in the course of the proceeding, orders were also made under s 50 concerning parts of certain affidavits filed and read in the proceeding and certain of the documents admitted into evidence in the proceeding.

81 The course described above was adopted variously with the consent of, or without opposition from or at the instance, of the Commission. A principal reason why that course was adopted was the concern expressed by the Commission that disclosure of names and other documents issued by the Commission in relation to its special investigation could prejudice the effectiveness of that investigation: C v Australian Crime Commission [2005] FCA 1736. This however was not the reason why the s 50 orders were extended as at 19 May 2008 because the Commission, at that hearing, informed the Court that it no longer sought protective orders under s 50. It seems, from the transcript, that the s 50 orders were, by consent, extended until further order to enable the application before the Court for further and better discovery to proceed that morning but on the basis that, in due course, the question of whether the s 50 orders would be maintained or not would be revisited later on a global basis.

The particular evidence

82 The particular evidence for which the appellant sought extended orders under s 50 and which is the subject of the appeal is in two categories:

• The "inference schedule" comprising parts of six pages in Part A, which refer to the allegations by the Commission of possible involvement of the appellant in schemes to evade the incidents of income tax, and all of the documents in Part C, and

• The "accounting advices" comprising documents in Part E, consisting of material in the possession of the Accountants. These are, in the main detailed confidential advices, some in draft form, prepared by the Accountants for the appellant and which relate to his private financial and taxation affairs (together "the confidential material").

83 The inference schedule was prepared by the Commission pursuant to Court order to give the appellant particulars of the alleged crime or fraud which underlay the asserted Cox v Railton Exception. It was the product of the Commission’s secret investigation of the appellant and was in part derived from material which the appellant had not been permitted to see. The allegations in the inference schedule had never been made public. The appellant had not been charged with the commission of such alleged crime or fraud. The inference schedule was put into evidence by the appellant in order to support his application for further and better discovery argued on 19 May 2008.

84 The accounting advices are confidential file notes and memoranda of accounting advice from the appellant’s Accountants. They were among the documents seized by the Commission. The basis of the application for further and better discovery was the appellant’s contention that the respondents had material adverse to its contentions in the inference schedule. The accounting advices were tendered as examples.

85 At the interlocutory hearing for further and better discovery the inference schedule and accounting advices were protected, until further order, by s 50 orders.

The decision appealed from

86 Before the primary judge and, as appears from his Honour’s reasons at paras [60]-[61], the appellant relevantly contended that the confidential material in respect of which he sought the continuation of orders under s 50 included matters of detail that, in the age of the internet and other electronic research, would permit delving into his personal, financial and taxation affairs in a way that is inconsistent with what would otherwise be his right to maintain confidentiality in relation to those affairs. He contended that the material that is otherwise available to the public ought to satisfy the public interest in open justice without destroying his right to preserve confidentiality in relation to his personal, financial and taxation affairs. However, the primary judge concluded that this argument reversed the correct approach, observing that the question is not whether the public has access to sufficient information to enable it to understand the nature and outcome of the proceeding but rather whether, once material has been introduced into evidence, it is necessary, in order to prevent prejudice to the administration of justice, that that material not be made available to the public.

87 The primary judge observed that it was not contended that disclosure of the material in part E would cause particular or specific harm or damage to the appellant, other than possible embarrassment and inconvenience by reason of his private affairs becoming public.

88 The primary judge was accordingly not persuaded that any sufficient reasons had been established by the appellant for continuing the s 50 orders made in respect of the confidential material.

The Appeal

89 The appellant advanced a number of arguments below as to why the s 50 orders should not be vacated. Only one of these is contained in the draft notice of appeal.

90 The grounds of appeal in the draft Notice of Appeal merely stated that the primary judge erred in setting aside his Order 4 made on 21 August 2008. Order 4 is in these terms:

4. Subject to further order by the court, pursuant to s 50 of the Federal Court of Australia Act 1976 (Cth):

(a) there be no publication of the documents behind Tabs C and E of Exhibit DPR1 to the affidavit of David Peter Rydon of 13 February 2008; and (b) publication of pages 5, 7, 8, 11-14, 19, 20 and 33 of Tab A and pages 104 and 105 of Tab D of the affidavit of David Peter Rydon of 13 February 2008 be limited to the redacted form attached to these orders.

91 It is not contended by the appellant that the primary judge misinformed himself as to matters of principle but rather that his Honour erred in failing to apply or to correctly apply those principles to the facts, in particular failing to undertake the balancing exercise required in applying s 50, failing to take into account relevant matters, or to consider, at all, the degree of derogation from the principle of open justice involved in the proposed order.

Consideration

92 A Full Court considered the meaning and effect of s 50 in Parish v Australian Broadcasting Commission [1980] FCA 33; (1980) 29 ALR 228. Bowen CJ said at 232-234:

The importance of the principle of open justice is not in doubt It is clear from s 17(1) of the Act that, in general, it is obliged to exercise its jurisdiction in open court. This provision gives statutory force to the principle that justice must be administered publicly in open court and gives recognition to the weight of public interest which attaches to that principle. However, s 17(4) and s 50 provide for encroachment upon that principle. Under s 17(4) the public or some of the public may be excluded where the court is satisfied their presence would be "contrary to the interests of justice". Open justice is the underlying assumption of s 50, not the criterion it prescribes. The section refers to preventing "prejudice to the administration of justice". This is not a reference to the need to preserve open justice. It is, as I have already suggested, a reference to another public interest, that is, the public interest that the court should endeavour to achieve effectively the object for which it was appointed: to do justice between the parties.

93 The general principle requires that ordinarily evidence in a court proceeding should be publicly available: Parish per Franki J at 243; per Deane J at 253.

94 In exercising the discretion the Court should take into account the underlying assumption upon which s 50 is based, that is, the principles of open justice. This is a process of judgment involving weighing on the scales the countervailing public interests involved: the public interest in open justice and the public interest in doing justice between the parties. The latter includes the particular public interest in having the court deal responsibly with the confidential affairs of citizens: Parish per Bowen CJ at 234.

Prevention or deterrence of pursuit of legal rights

95 The primary judge concluded that this was not a case where the embarrassment or damage that publicity might occasion was such that it would, or there was a real risk, as opposed to a remote possibility, that it would have prevented or deterred the appellant from pursuing his application for further or better discovery: [54]. In so finding I am of the opinion that his Honour fell into error.

96 It is to be remembered that, in the appellant’s substantive proceeding, he sought relief by way of injunctive and other orders to preserve the legal professional privilege he claimed in respect of certain documents seized by the Commission.

97 Accordingly, the very subject matter of the proceedings was concerned with confidential communications.

98 The Cox v Railton contention advanced by the Commission created a serious dilemma for the appellant. He could elect to not put on the confidential material and potentially damage his defence at trial to this contention, involving as it did very serious allegations of criminal conduct made by the Commission, because of deficient discovery from the Commission. Alternatively, he could take the risk of confidential material becoming public in order to defend his claims to privilege by being able or better able to answer the Cox v Railton contention of the Commission.

99 It is evident that, if the appellant elected to advance his interlocutory application for further and better discovery and in order ultimately to advance his substantive application, the appellant had no choice other than to rely upon the material which is now the subject of the appeal.

100 The primary judge’s reasons reflect this position at [69]:

It would be fair to conclude that the applicant’s decision to adduce evidence was driven by the object of succeeding in his application [for further and better discovery] against the Commission. It is difficult to see how the proceeding could have been prosecuted otherwise than by tender of the material in question. In the absence of the material, it would have been well nigh impossible for the Court to understand what the issue was.

101 The uncontradicted sworn testimony of the appellant’s solicitor is that this confidential material was deployed by him in an un-redacted form in the circumstances where it would either have been redacted or not have been deployed at all, if confidentiality were not to be maintained.

102 It is instructive to set out the relevant part of the affidavit of the appellant’s solicitor, Mr David Rydon, affirmed on 14 July 2008 in this respect:

12. Since the commencement of these proceedings on behalf of the Applicant (at that time A3 but later P) I have proceeded on the assumption that in order to allow for the effective conduct of the Action, the `understanding' between the Applicant and the ACC was that open communication would occur by way of correspondence and that in the event of there being the necessity to obtain interlocutory orders, appropriate steps would be taken to ensure that as far as possible material deployed in support of those Motions would be kept confidential. In so far as the Applicant was concerned, this was of importance because the material possibly to be deployed from time to time related to the Applicant P's personal tax affairs. Accordingly I have prepared and filed affidavits and exhibits in these proceeding on the basis of this assumption.

13. It has been my experience that, for example, in taxation proceedings where such material is filed, steps are taken to either redact or otherwise preserve the confidentiality of the taxation information filed. This is in keeping with the general confidentiality requirements imposed under the Income Tax Assessment Act as well as in recognition that such material is private and confidential and ought.not to be in the public domain.

14. While I have at all times understood that the making of s 50 orders was a matter for the Court, I have proceeded on the basis that the prospect of such orders being made was maximised if the ACC did not change its position of either supporting or not opposing such orders being made. In these and.the other related proceedings referred to above, the ACC consented to, actively sought on its own behalf or did not oppose such orders being made and such orders were generally made in the course of these proceedings (and the related proceedings) in relation to material which is presently subject to s 50 orders. If the ACC had indicated that it would no longer maintain that position or if the Court indicated that it would not make such orders, I would have instructed Counsel to withdraw affidavits (and exhibits) as necessary to allow them to be recast.

15. In these proceedings, in reliance on my general understanding that deployed material would be kept confidential, the Applicant, on my advice, has filed from time to time affidavits in support of Notices of Motion where the affidavit has exhibited material that I would have advised the Applicant to deploy differently (e.g. subject to redaction) or not at all if the material was likely to be placed in the public domain. An example in point is the material contained under Tabs C and E to my affidavit dated 13 February 2008 and filed in support of the Applicants Notice of Motion seeking discovery from the ACC.

16. Order were made by the Court on 19 May 2008 under s 50 of the Federal Court Act in relation to, inter alia, Tabs A, C and E of the Exhibit DPR 1 to that affidavit.

This evidence was not challenged by the Commission.

103 Accordingly, the entire history of the proceeding prior to 19 May 2008 was set within a confidentiality regime required under s 50.

104 Whether or not there was a basis for the solicitor reasonably to understand, on and after 19 May 2008 that "deployed material would be kept confidential" his evidence nonetheless points up the dilemma to which I have referred. Section 50 ought, in my opinion, in the interests of the administration of justice, aid the resolution of such a dilemma.

105 As Deane J said in Parish at 255:

The results of an undue discounting of legitimate claims to confidentiality are likely to be both the deterrence of the subject from having recourse to courts of justice for the vindication of legal rights. ... The interests of the administration of justice plainly make it desirable that obligations of confidence be not lightly overruled and that legitimate expectations of confidentiality as to private and confidential transactions and affairs be not lightly disregarded.

106 The matter was put in this way by the Full Court in Herald & Weekly Times Ltd v Williams [2003] FCAFC 217; (2003) 130 FCR 435 at [36] by Merkel J, Finn and Stone JJ agreeing:

[36] A different situation might arise, for example, if the embarrassment or damage that publicity might occasion is such that it would prevent or deter a person from prosecuting or defending a proceeding in the Court, or "if there was a real risk as opposed to a remote possibility that this would occur": see Johnston v Cameron [2002] FCAFC 251; (2002) 195 ALR 300 at 319. If that situation arises it can be weighed in the discretionary balance that is to be struck between the public interest of open justice and preventing prejudice to the administration of justice. However, that situation has not arisen in the present matter.

Subject matter of proceedings concerned confidential documents

107 The interveners contend that the inference schedule is a document in which the appellant has not established qualities of confidentiality. The appellant submits the inference schedule was plainly a confidential document. I agree. The following submissions by the appellant more than adequately support this conclusion. The inference schedule had been produced by the Commission and served on the appellant pursuant to an order of the Court so that the appellant might have particulars of the criminal or fraudulent activity which the Commission relied upon to invoke its Cox & Railton contention. It was the product of the Commission’s own secret inquiries and internal processes. It summarised the contents of both the Commission’s affidavits and supporting documents, which themselves had not been read and to which the trial judge accordingly refused access to the interveners under O 46 of the Federal Court Rules. It was provided to the appellant by the Commission for the purposes of the proceedings, rather in the same way that affidavits are served inter partes. While not confidential as between the appellant and the Commission, the inference schedule was confidential as against the rest of the world as neither the Commission nor the appellant could use it for any purpose other than in connection with the proceedings without the express leave of the Court: Hearne v Street [2008] HCA 36; (2008) 235 CLR 125 at [96] per Hayne, Heydon and Crennan JJ. Confidentiality had been preserved by the earlier s 50 orders that had been made by the trial judge.

108 In Parish, Bowen CJ considered the application of s 50 in order to prevent the destruction of the subject matter of the proceedings referring to cases involving a secret process or ones involving the restraint of publication of confidential material. As his Honour observed at 233:

Where proceedings are brought to restrain publication of confidential material, similar considerations apply. Disclosure would prejudice the Court’s proper exercise of the function it was appointed to discharge, to do justice between the parties.

109 His Honour’s observations require to be considered in context. Unlike Parish the confidential material here was not the material in respect of which privilege was claimed in the substantive proceedings. The primary judge so concluded at [55]. However, I do not regard that as fatal to the appellant’s position. The categories of circumstances which may attract an order under s 50 are not closed: Parish at 233 per Bowen CJ.

110 This case comes, on one view, very close to the position in Parish and on another view it is on all fours. The first view is as follows. Although the confidential material was not directly the subject matter of the suit it was related in the sense that an appreciation of it was necessary to the resolution of the Cox v Railton contention at least in ensuring that the Commission comply with its discovery obligations so that all relevant material was available to the appellant and the Court. Such matters lie at the heart of doing justice between the parties in almost every case. The Cox v Railton issue was the only remaining obstacle to the prima facie finding of privilege by the primary judge becoming final. It would be a curious result if, in attempting to preserve claims to legal professional privilege, an applicant was compelled to advance evidence of private and confidential information upon an interlocutory dispute which was effectively forced upon him by the other party advancing a Cox v Railton contention. This, in my opinion, would result in prejudice to the administration of justice in failing to do justice between the parties by not paying proper regard to confidentiality: Parish per Bowen CJ at 234-236.

111 The observations of Deane J in Parish at 255-256 are, in my respectful opinion, apt to the present case:

Even where publicity would not destroy the subject matter of the litigation, the need to respect legitimate claims to confidentiality will be a factor - and in some cases a determining factor - to be placed in the overall balance in considering whether an order under s 50 should be made. Damage and hardship to the individual from the working of legal processes can only be justified if they are warranted by countervailing benefit, or avoidance of prejudice, to the general administration of justice or by the legitimate claims and expectations of other individuals. When not so warranted, such damage or hardship is to the overall prejudice of the administration of justice.

112 The second view is that the immediate subject matter of the discovery application directly concerned confidential documents: those in the possession of the Commission which it had not discovered. These included, at least, the second category of confidential material, namely the accounting advices. The approach taken in Parish justifies the same approach in this case viewed in this way.

113 It is the public interest in the Court dealing appropriately with matters of confidentiality between the parties which is central to this issue. The matter of possible embarrassment or personal prejudice is very much subordinated to it.

Prejudice

114 The primary judge observed that no evidence of specific damage or prejudice that would be or might be occasioned by the disclosure of the material in question was addressed by the appellant. I do not respectfully consider that it was necessary for such evidence to have been adduced. Indeed it is difficult to appreciate how specific damage or prejudice could be proved, in advance of its occurrence. What is plain enough, however, is that publication of the content of the inferences in the schedule would undoubtedly lead to very significant damage and prejudice to the appellant’s reputation personally and possibly professionally. The damage associated with the release of confidential tax advices to the public is, at the least, the very fact that such obviously confidential documents become available to the public.

The matter of derogation

115 The primary judge at [56] set out the substance of what Bowen CJ in Parish said at 236 on the matter of derogation from the principles of open justice as follows:

While the principle of open justice is of great importance in exercising the discretion under s 50, it is not necessarily the whole weight of that principle that is to be placed on the scales. The derogation from the principle that is involved in making an order under s 50 may be very great. However, it will not necessarily be very great and, in the exercise of the discretion, the degree of derogation involved in the proposed order is an important matter to be considered.

116 It is not evident from his Honour’s reasons that any consideration was given to this matter. This, I think, was because his Honour was not satisfied generally that a case for s 50 orders had been established and accordingly that it was not necessary to consider this aspect. Nonetheless, given my contrary opinion, it is a matter which ought now be considered.

117 The real interest of the interveners is revealed in their opening written submissions namely that these interlocutory orders were obtained in the context of the largest investigation into alleged tax fraud in Australian history. However, the case, objectively viewed, was in my opinion, a claim by the appellant to protect his claim to legal professional privilege. The case was not concerned, other than in its very broad context, with a major tax fraud investigation.

118 The confidential material was put on in support of what transpired to be a successful application by the appellant for further and better discovery going to the Cox v Railton point. It was not tendered as part of the appellant’s case on his substantive application nor was there any suggestion that it would be. The issue before the Court then, and, in turn, any associated legitimate public interest, concerned interlocutory orders for particular discovery and the reasons why such orders were made.

119 The hearing was in no way dispositive of the rights of the parties in the substantive application nor could it have been. The abandonment of the Cox v Railton contention meant that the allegations of criminal conduct in the inference schedule were never tested at a final hearing. Furthermore, the Court permitted confidential material to be relied upon confidentially in an interlocutory argument in a case concerning an investigation of the appellant the particulars of which were themselves secret. The matter of derogation needs to be seen in that context. Ordinarily such matters do not attract any degree of public attention. It is not difficult to understand why the interveners have an interest in the confidential material. It is likely, no doubt, to attract wide attention in the media if made available, but not, I venture to suggest, to enable the public to understand why interlocutory discovery orders were made which was the way it was put by counsel for the interveners.

120 The transcript of the hearing is available. It runs to some 60 pages of argument by the parties to the motion. The orders made on 9 August 2007 and 19 May 2008 are quite detailed and publicly available. It is quite evident that the primary judge was satisfied that insufficient enquiry had been made by the Commission in supposed compliance with the discovery orders made on 9 August 2007 and required further attention to these orders with the steps taken in that regard to be the subject of a detailed affidavit on behalf of the respondents.

121 The primary judge said this, as to the public interest, in light of the appellant’s submissions at [60]-[61]:

[60] The applicant is a prominent figure. He says that the material in respect of which he seeks the continuation of orders under s 50 includes matters of detail that, in the age of the internet and other electronic research, would permit delving into his personal, financial and taxation affairs in a way that is inconsistent with what would otherwise be his right to maintain confidentiality in relation to those affairs. He says that the material that is otherwise available to the public ought to satisfy the public interest in open justice without destroying his right to preserve confidentiality in relation to his personal, financial and taxation affairs. [61] However, that argument reverses the correct approach. The question is not whether the public has access to sufficient information to enable it to understand the nature and outcome of the proceeding. The question is whether, once material has been introduced into evidence, it is necessary, in order to prevent prejudice to the administration of justice, that that material not be made available to the public.

122 I respectfully have concluded that his Honour erred in principle in his approach to the appellant’s submissions. They were, I think, not seeking to reverse the correct approach but rather were directed to the question of derogation.

123 Bowen CJ in Parish at 238, on the issue of derogation, considered it relevant, correctly in my respectful opinion, to have regard to the ability of the public to follow the argument intelligently and to appreciate adequately the fundamental question involved, even in the absence of knowledge of the details [of the finance arrangements in the agreement.]

124 There is a further factor going to the question of derogation which was not considered, it seems, in relation to this issue. It is that the respondents abandoned the Cox v Railton point before complying with the further discovery orders of 19 May 2008. There was no justice then to be done between the parties at that time and on that question. It was as if it had never been raised. The legitimate interest of the public in the full disclosure of the evidence tendered by the appellant on that day is, in my opinion, in these circumstances, marginal and of little weight when set against the potentially highly damaging release of inferences said by the Commission to arise going to alleged criminal conduct on the part of the appellant but in the absence of any charges laid against him as well as the intrusion into the confidential financial affairs of the appellant by the release of detailed private financial and taxation advices prepared by the Accountants.

125 Rares J considered the matter of untested allegations in Llewellyn v Nine Network Australia [2006] FCA 836; (2006) 154 FCR 293, where at [28] he said:

I am of opinion that a similar principle is well known to members of the community in respect of civil litigation. The proposition that untested allegations in civil proceedings are somehow to be shielded from public view merely because they are untested allegations and could only possibly be properly understood in the context of a fully contested hearing is, in my opinion, not one that can sit with the principle of open justice or the right of anyone fairly to report proceedings in a court of justice.

126 This observation is not, in my opinion, apt to this case. In Llewellyn the untested allegations went to the core of factual matters pleaded. That is not the case here. The correctness of the inferences in the schedule was not at issue on the discovery application. Although made in civil proceedings, the allegations in the inference schedule were of criminal or fraudulent conduct. They did not have the standing of formal charges, which of their nature have the weight that a responsible prosecutorial authority has formed the view that there is evidence in support of those charges reasonably capable of giving rise to a conviction. On the contrary, the material in the inference schedule had been prepared by reference to the much lower standard that it was only necessary for the Commission to satisfy the Cox & Railton test by showing it had material "to give colour to the charge": Commissioner of Australian Federal Police v Propend Finance Pty Ltd [1997] HCA 3; (1996-1997) 188 CLR 501 at 514 per Brennan CJ.

Conclusion

127 In relation to each of these three discrete matters it is not, as the interveners submit, a case involving inadequate weight being afforded to them by the primary judge. It is my opinion that no weight was given to them when they ought to have attracted very significant weight. However, I do not accept the appellant’s submission that the primary judge did not embark upon a balancing exercise in relation to the competing public interests. His Honour correctly identified the relevant principles. I have concluded that his Honour erred in rejecting matters which were relevant to the balancing exercise.

128 In my opinion, and for these reasons, the primary judge was in error in failing to conclude that in these circumstances an order under s 50 was necessary in order to prevent prejudice to the administration of justice.

129 I would grant leave to appeal and would allow the appeal with costs. There should be an order that Order 1 made on 29 August 2008 be varied by adding after the word "vacated" the words "other than Order 4 made on 21 August 2008".

I certify that the preceding seventy-two (72) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gilmour.

Associate:

Dated: 19 June 2009

Counsel for the Appellant:	F Kunc SC with C Spruce
Solicitor for the Appellant:	Robinson Legal
Counsel for the Respondents:	D.F.C. Thomas
Solicitor for the Respondents:	Australian Government Solicitor
Counsel for the Interveners:	T Maltz

Date of Hearing:	4 March 2009
Date of Judgment:	19 June 2009