A Person v Independent Commissioner Against Corruption (No 3)

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application)
A PERSON v INDEPENDENT COMMISSIONER AGAINST CORRUPTION (No 3)
[2021] SASC 31
Ruling of the Honourable Justice Parker

STATUTES - ACTS OF PARLIAMENT - INTERPRETATION
STATUTES - ACTS OF PARLIAMENT - INTERPRETATION - SCHEDULES
STATUTES - ACTS OF PARLIAMENT - INTERPRETATION - PARTICULAR WORDS AND PHRASES - SPECIFIC INTERPRETATIONS - IN RELATION TO
The claimant was partially successful in its application under clause 3 of Schedule 3 to the Independent Commissioner Against Corruption Act 2012 (SA) (ICAC Act). This ruling concerns the power of the Independent Commissioner Against Corruption to retain an item seized by an investigator in the exercise of the statutory powers conferred by s 31 of the ICAC Act after this Court has ruled on questions of legal professional privilege.
Held, per Parker J:
1.The phrase “in relation to” in s 31(14) of the ICAC Act has a broad effect and to serves to link the exercise of powers conferred under a warrant issued pursuant to s 31 with the thing or document that is seized. Thus, the words “in relation to” in s 31(14) apply Schedule 3 to a thing seized pursuant to a warrant issued under s 31.
2.As s 31(14) displaces the operation of s 32(3a), that section will not operate in cases where clause 4(3) or clause 4(5) of Schedule 3 of the ICAC Act requires the Court to order that a seized thing to be returned to the claimant.
3.The claimant’s mobile phone, as distinct from its memory, cannot be separated into a privileged part and non-privileged part, it therefore falls within the residual provision in para (c) of Schedule 3. The phone must be returned to the claimant after copying of that part of its contents found not to be privileged.

Independent Commissioner Against Corruption Act 2012 (SA) s 5, s 31, s 32, s 56, sch 3; Acts Interpretation Act 1915 (SA) s 19(1)(a), referred to.
Inland Revenue Commissioners v Gittus [1920] 1 KB 563; O’Grady v Northern Queensland Co Ltd (1990) 169 CLR 356; Re Foley; Channell v Foley (1952) 53 SR (NSW) 31; Technical Products Pty Ltd v State Government Insurance Office (1989) 167 CLR 45; Travelex Ltd v Commissioner of Taxation (2010) 241 CLR 510, applied.
South Australian Banking Co v Horner (1868) 2 SALR 263, considered.

A PERSON v INDEPENDENT COMMISSIONER AGAINST CORRUPTION (No 3)
[2021] SASC 31
Civil

PARKER J: This ruling concerns the power of the Independent Commissioner Against Corruption (the Commissioner) to retain an item (i.e. a mobile telephone) seized by an investigator in the exercise of the statutory powers conferred by s 31 of the Independent Commissioner Against Corruption Act 2012 (SA) (the ICAC Act) after this Court has ruled on questions of legal professional privilege.
The determination of the legal professional privilege issue was made by the Court under Schedule 3 of the ICAC Act. Section 56 of that Act prohibits the publication, without the permission of the Commissioner or of a Court hearing proceedings for an offence against the Act, of anything that tends to suggest that a particular claimant has been the subject of an investigation. Accordingly, the reasons that I delivered when I decided the privilege issue, and also when I declined to make any order for costs, have not been published and the claimant has not been identified by name. However, I was requested by senior counsel for the claimant to publish my ruling on the return of the phone. That was not opposed by counsel for the Commissioner. I have taken care to avoid inclusion of anything that might possibly identify the claimant.
Background
The Commissioner seized a mobile telephone owned by a person who is the subject of an investigation. The claimant applied to the Court under Schedule 3 of the ICAC Act for the Court to determine whether certain messages stored in the memory of their phone were the subject of legal professional privilege.
In accordance with clause 3 of Schedule 3 to the ICAC Act the phone was provided to the Court. Subsequently, a judge of this Court made orders permitting the phone to be released to Mr Robert Taylor, a digital forensic analyst employed by the Commissioner, for the purpose of extracting data consisting of communications between the claimant and two others who were said to be their legal advisors. Importantly, Mr Taylor was ordered by the Court not to communicate the data to any other person. The material was to be downloaded onto four electronic storage devices and hard copies produced of the relevant communications. Thereafter, the phone, the electronic storage devices and the hard copies were to be placed in a sealed envelope and returned to the Supreme Court Registry.
Subsequently, the two legal advisors identified, in affidavits, those documents extracted from the claimant’s phone that were said to be privileged. After hearing submissions from counsel and examining the documents that had been identified, I determined that certain of the messages were properly the subject of a claim for legal professional privilege. I also found that a very clear majority of the messages that were said to be privileged were not privileged. After redacting the privileged material, the Court provided hard copies of the messages extracted from the claimant’s phone to the Commissioner.
The question of privilege having been determined, the claimant seeks the return of their phone. The Commissioner contends that she is entitled to retain the phone until it is decided whether criminal proceedings are to be instituted against the claimant, and if that occurs, until those proceedings are resolved.
The legislative scheme
Section 31(1) of the ICAC Act empowers the Commissioner on her own initiative, or on application by an investigator, to issue a warrant authorising an investigator or a police officer to enter and search certain places and vehicles. Section 31(2) empowers a judge of this Court, on application by an investigator, to issue a warrant authorising an investigator or a police officer to enter and search any place or vehicle. Section 31(3) requires that before a warrant is issued by a judge or the Commissioner they must be satisfied that the warrant is reasonably required for the purposes of an investigation into a potential issue of corruption in public administration.
Most importantly, s 31(7)(c)(v) empowers an investigator or a police officer to seize and retain anything that they reasonably suspect may constitute evidence of a prescribed offence. The term “prescribed offence” is defined in s 4 to mean corruption in public administration or an offence against the ICAC Act. The term “corruption in public administration” is widely defined in s 5.
Section 32 establishes seizure and retention order procedures. As it has not been suggested that a retention order has been issued in this matter, the only provision in s 32 of present relevance is 32(3a), which provides as follows:
(3a)If any thing has been seized under section 31 or under subsection (3)(c), the following provisions apply:
(a) the thing must be held pending proceedings for an offence relating to the thing seized, unless the Commissioner, on application, authorises its release to the claimant from whom it was seized, or to a claimant who had legal title to it at the time of its seizure, subject to such conditions as the Commissioner thinks fit;
(b) if proceedings for an offence relating to the thing are instituted, the court dealing with the proceedings may order—
(i)that it be forfeited to the Crown; or
(ii)that a claimant to whom it was released under paragraph (a) or the defendant pay to the Attorney‑General an amount equal to its market value at the time of its seizure as the court thinks fit; or
(iii)that it be released to any claimant.
A finding must have been made by the Commissioner or a judge under s 31(3) prior to the issue of the warrant. At least at this stage, the issue of the warrant has not been challenged. I therefore proceed on the basis that, subject to the potential operation of Schedule 3, s 31(7)(c)(v) and s 32(3a) would empower the Commissioner (or strictly speaking, the investigator) to retain the phone. There has been no contrary submission.
Section 31(14) states “The provisions set out in Schedule 3 apply in relation to a warrant under this section.” Clause 4 of Schedule 3 empowers this Court to determine claims of privilege in respect of documents or other things that a person executing a warrant wishes to inspect, copy or seize. Sub-clauses (3), (4) and (5) of clause 4 deal with the return of documents or things that have been the subject of a claim for privilege that has been determined by the Court as follows:
(3) If the Supreme Court determines that the whole of the document or thing is the subject of privilege—
(a)     the Court must order that the document or thing be returned to the claimant;
and
(b)     the proper officer must return the document or thing to the claimant.
(4) If the Supreme Court determines that the document or thing is not the subject of privilege—
(a)     the Court must order that the document or thing be given to the Commissioner; and
(b)     the proper officer must release the document or thing accordingly.
(5) If the Supreme Court determines that a part of the document or thing is the subject of privilege (the privileged part) and a part is not (the non-privileged part)—
(a)     if the document or thing is able to be divided into the privileged part and the non-privileged part—
(i) the Court must so divide the document or thing and order that the privileged part be returned to the claimant and the non-privileged part be given to the Commissioner; and
(ii) the proper officer must return the privileged part to the claimant and release the non-privileged part to the Commissioner; or
(b)     if paragraph (a) does not apply but the Court is of the opinion that it would be possible to produce a copy of the document or thing from which the privileged part is able to be redacted—
(i) the Court must make such orders as the Court thinks fit for the production of such a copy; and
(ii) the Court must order that the copy so produced be given to the Commissioner and that the document or thing be returned to the claimant; and
(iii) the proper officer must—
(A) release the copy so produced to the Commissioner; and
(B) return the document or thing to the claimant; or
(c)     in any other case—
(i) the Court must order that the document or thing be returned to the claimant; and
(ii) the proper officer must return the document or thing to the claimant.
The Commissioner’s submissions
Counsel for the Commissioner submitted that the ICAC Act required that the phone and the electronic storage device must be returned to the Commissioner. Counsel submitted that the Commissioner was concerned to avoid a contention being advanced at the trial of any criminal proceedings that the prosecution had not adduced the best evidence of any communication that it sought to tender if it simply relied upon the redacted hard copies returned by the Court. The defence may submit that the text messages should not be admitted into evidence or should be accorded less weight because they are not the best evidence of the communications. There is a concern that the chain of evidence will have been broken if the prosecution is not able to tender the phone at trial.
Counsel submitted that the best evidence issue might be addressed by either the phone being returned into the custody of the Commissioner or, alternatively, the claimant giving an undertaking not to take any point at trial based on the failure of the prosecution to produce the best evidence of communications. The terms of such an undertaking could be negotiated and agreed in writing.
While acknowledging that there was no evidence on the point, counsel for the Commissioner noted that Mr Taylor considered that with developments in technology there was a possibility that in future, and potentially before any trial, it may be possible for him to extract further data and information from the phone. If necessary, evidence could be put before the Court about that matter.
Against that background, counsel advanced the following submissions concerning the operation of the ICAC Act. Section 31(7) authorises an investigator to retain anything that has been seized pursuant to a warrant issued under the Act. Section 32(3a) specifically provides that if any thing has been seized under s 31 then it must be held pending proceedings for an offence unless, on application, the Commissioner authorises its release. In this light, counsel submitted that the Commissioner was obliged to maintain the best evidence and thus the phone and the storage device must be returned to her by the Court. Counsel further submitted that the provisions in clause 4 of Schedule 3 are subject to s 31 and s 32.
In support of that contention, counsel submitted that it would be an absurd result if a phone contained 100,000 unprivileged items but the Commissioner was required to return it simply because it contained one unrelated privileged item, such as instructions for a will.
Counsel also submitted that if the Court were to determine that the phone should be returned to the claimant, the order made by the Court should expressly state that the Court was directing that the phone be returned to the claimant by the Registrar under clause 4(5)(c) of Schedule 3 to the ICAC Act. Counsel suggested that this approach may possibly provide an answer to a defence submission at trial that the best evidence rule was not satisfied.
Submissions on behalf of the claimant
Senior counsel for the claimant submitted that although s 32(3a) of the ICAC Act confers a power upon the Commissioner to retain seized items, Schedule 3 operates as a “carve out” for items over which privilege is claimed. In other words, a different regime applies to privileged material.
The present circumstances fall within clause 4(5)(c) of Schedule 3 as the phone cannot be divided into privileged and non-privileged parts and nor can the phone be copied (as distinct from the content of its memory) and divided into privileged and non-privileged components. As clause 4(5)(c) applies, the phone must be returned to the claimant.
Consideration
The orders made by another judge of this Court encompassed the downloading from the mobile phone seized from the claimant under a warrant of communications between the claimant and their two lawyers, the copying of that material onto electronic storage devices and the production of hard copies of the downloaded material. All of that material, including the phone, was provided to the Registrar of this Court.
I subsequently made orders concerning material that was claimed by the claimant to be privileged. While I found that there was certainly privileged material, I rejected the majority of claims. There were also many communications between the claimant and their lawyers that were not the subject of a claim for privilege.
The phone may also contain communications with a great many other people in addition to the claimant’s lawyers. Such messages, or other information held in or accessible through the phone, might potentially provide relevant evidence to support a prosecution.
The resolution of the question concerning return of the phone hinges upon a question of statutory interpretation, i.e. whether the provisions of Schedule 3 prevail over ss 31 and 32. Depending on the answer to that question, there may also be an issue as to how the statutory scheme applies to the electronic storage devices upon which the communications extracted from the phone are stored.
There was a suggestion by counsel for the Commissioner that the provisions of ss 31 and 32 should prevail over Schedule 3. At least until the 19^th century, the orthodox view was that provisions contained in the body of an Act prevailed over the contents of a schedule.[1] However, more recent authority has recognised that a schedule is not an inferior portion of an Act but constitutes part of the Act.[2] Section 19(1)(a) of the Acts Interpretation Act 1915 (SA) has put the approach taken in the more recent authorities into statutory form. It provides that a schedule forms part of an Act. Thus, the interaction between provisions found in the body of an Act and in a schedule, must be approached without any presumption that the former will prevail in the event of an apparent inconsistency. Any question of inconsistency must be resolved by reference to the text, context and purpose of the ICAC Act and by applying the general principles of statutory interpretation.
[1] South Australian Banking Co v Horner (1868) 2 SALR 263 at 264 (Gwynne J); see also Dennis C Pearce, Statutory Interpretation in Australia (LexisNexis Butterworths, 9^th Ed, 2019) at [4.68] and cases cited therein.
[2] Re Foley; Channell v Foley (1952) 53 SR (NSW) 31 at 36 (Roper CJ in Eq); Inland Revenue Commissioners v Gittus [1920] 1 KB 563 at 576 (Lord Sterndale MR).
For the reasons that follow, I consider that any doubt about the interaction between ss 31 and 32 and Schedule 3 is resolved by s 31(14). The phone was seized pursuant to a warrant issued under s 31. Section 31(14) only applies the provisions of Schedule 3 to a warrant issued under s 31. It might therefore be contended that Schedule 3 does not affect the operation of s 32(3a) because the latter lies outside s 31. While counsel for the Commissioner did not specifically advance the point, it is necessarily implicit in his submissions. If this contention is correct, a thing seized under s 31 must in all circumstances be held pursuant to s 32(3a) pending proceedings for an offence relating to the thing seized unless the Commissioner authorises its release.
I do not consider that the possible contention discussed in the preceding paragraph to be correct. My reasons follow.
If s 31(14) operates so that Schedule 3 prevails over s 31, but not over s 32, this would create an inconsistency between s 31 and s 32. That inconsistency would arise because, in certain of the circumstances referred to in clause 4(5) of Schedule 3, a partly privileged thing seized under s 31 must be returned to the claimant[3] yet s 32(3a) requires a seized thing to be held until the Commissioner authorises its release.
[3] i.e. the claimant claiming privilege.
I do not consider that such a potential inconsistency could arise between s 31 and s 32. That is because s 31(14) does not apply the provisions of Schedule 3 for the purposes of s 31. Instead s 31(14) expressly provides that the provisions of Schedule 3 apply in relation to a warrant issued under s 31. That requires an examination of the effect of the phrase “in relation to”.
Emeritus Professor Dennis Pearce has suggested in Statutory Interpretation in Australia that each of the phrases “in relation to”, “in respect of”, “relating to”, “related to” and “with respect to” are synonymous in meaning.[4] In Technical Products Pty Ltd v State Government Insurance Office, Brennan, Deane and Gaudron JJ described these phrases as having a “chameleon-like quality in that they commonly reflect the context in which they appear”.[5]
[4] (LexisNexis Butterworths, 9^th Ed, 2019) at [12.7] to [12.9].
[5] (1989) 167 CLR 45 at 47.
In Travelex Ltd v Commissioner of Taxation French CJ and Hayne J stated:[6]
It may readily be accepted that “in relation to” is a phrase that can be used in a variety of contexts, in which the degree of connection that must be shown between the two subject matters joined by the expression may differ. It may also be accepted “the subject matter of the inquiry, the legislative history, and the facts of the case” are all matters that will bear upon the judgment of what relationship must be shown in order to conclude that there is a supply “in relation to” rights.
(Citations omitted)
[6] (2010) 241 CLR 510 at [25].

In O’Grady v Northern Queensland Co Ltd, Toohey and Gaudron JJ stated that the words “in relation to” were “of broad import”.[7] McHugh J said in the same case that the expression “requires no more than a relationship, whether direct or indirect, between two subject matters”.[8]
[7] (1990) 169 CLR 356 at 374.
[8] Ibid at 376.
In view of those authorities, I consider that the phrase “in relation to” in s 31(14) has a broad effect and to serves to link the exercise of powers conferred under a warrant issued pursuant to s 31 with the thing or document that is seized. Thus, the words “in relation to” in s 31(14) apply Schedule 3 to a thing seized pursuant to a warrant issued under s 31.
Section 32(3a) requires the retention of a thing. Leaving aside instances where a thing has been seized following issue of a retention order (not this case), the thing can only have been seized pursuant to a warrant issued under s 31. Because the warrant itself, and also the seizure of the thing under that warrant, are subject to Schedule 3, it necessarily follows that s 31(14) displaces the operation of s 32(3a). Thus, s 32(3a) will not operate in cases where clause 4(3) or clause 4(5) of Schedule 3 requires the Court to order that a seized thing be returned to the claimant.
I have said that “it necessarily follows” that s 31(14) displaces the operation of s 32(3a). In addition to the textual matters to which I have referred, it is significant that s 32(3a) is a general provision dealing with the retention of things that have been seized pursuant to a warrant issued under s 31. Section 31(14) and Schedule 3 operate in the very specific context of a legislative scheme established to enable claims for privilege over seized documents to be resolved by the Court.
In other words, Schedule 3 sets up a special regime to provide for the determination of claims for privilege in respect of documents or things that have been seized in the execution of a warrant. That specific provision must prevail over the general provision. To adopt the language used by senior counsel for the claimant, Schedule 3 creates a “carve out” from the general regime otherwise established by ss 31 and 32. That “carve out” only applies where a claim for privilege is referred to the Court and the Court has determined that the document or thing is wholly privileged or contains both privileged and non-privileged material.
I therefore turn to the application of Schedule 3 to the present facts. Clause 4(3) requires the Court to order that a document or thing be returned to the claimant who has claimed privilege if the whole of the document or thing is found to be subject to privilege. That provision is clearly not applicable in the present circumstances.
Clause 4(4) deals with the reverse situation where the Court has determined that the document or thing is not the subject of privilege. In those circumstances, the Court must order that the document or thing be given to the Commissioner. In the present case, the Court has found that some of the material retained in the memory of the phone is privileged. Thus clause 4(4) does not apply.
Clause 4(5) deals with three different situations that may arise where the Court has determined that part of a document or thing is privileged and part is not.
Under para (a) of clause 4(5), if the document or thing is able to be divided into a privileged part and a non-privileged part, the Court must divide the document or thing accordingly and order that the non-privileged part is given to the Commissioner and the privileged part returned to the claimant from whom it was seized. Paragraph (a) does not apply to the phone nor to its memory while it remains within the phone prior to material having been copied onto the electronic storage devices. The barrier to the application of para (a) is that the phone, or more accurately its memory, cannot be divided into a privileged part and a non-privileged part. However, that division has already occurred in relation to the hard copies of the material extracted from the memory held within the phone.
The latter situation is the topic of para (b). This provision applies where the Court considers that it would be possible to produce a copy of the document or thing from which the privileged part is able to be redacted. In this situation, the Court must order that the redacted copy is provided to the Commissioner and the unredacted document or thing is returned to the claimant.
On the facts of the present case, para (b) does not deal with the phone itself as distinct from the material that has been extracted from its memory. The entire contents of the phone have been copied onto an electronic storage device (referred to as Item 2). Other electronic storage devices contain copies of the messages that passed between the claimant and their two legal advisers (Items 3, 7 and 11). The latter material has also been printed in hard copy form. The original electronic record of the communications remains within the phone, as presumably does other material that might potentially have an evidentiary value. Those two considerations are apparently the basis for the concern held by the Commissioner about the potential adverse application of the best evidence rule.
Paper copies of the communications between the claimant and their legal advisers that were found by the Court not to be privileged were provided to the Commissioner in accordance with clause 4(5)(b). After I indicated that I intended to order that the phone should be returned to the claimant under clause 4(5)(c) (see below), the Commissioner contended that the Court should permit a fresh copy of the entire contents of the phone to be copied on to an electronic device save for the material that I had found to be privileged. That approach was preferred by the Commissioner as opposed to the deletion of privileged material from Item 2 as she considered that it would remove or reduce room for a later contention that the contents of Item 2 had been interfered with or manipulated.
After hearing further submissions from counsel, I granted permission under clause 4(5)(b)(ii) for Mr Taylor to make a fresh electronic copy of the entire contents of the seized phone before it is returned to the claimant by the Court save for any of the messages that I had found to be privileged. Mr Taylor was ordered not to make a copy or disclose to any claimant whatsoever any of the privileged material. Orders were also made requiring that all other electronic copies of communications between the claimant and their legal advisers were to be permanently deleted.
Paragraph (c) of clause 4(5) operates as a residual provision. It provides that “in any other case” the Court must order that the document or thing is returned to the claimant who has claimed privilege. The words “in any other case” cover any situation that is not encompassed by either para (a) or para (b).
As I have already noted, para (a) does not apply to the phone nor to its memory prior to material having been extracted. Para (b) applies to the material that has been extracted and copied but does not apply to the phone itself. Accordingly, the situation is covered by the residual provision in para (c). Thus, I ordered that the phone must be returned to the claimant.

[2021] SASC 31

30 March 2021