Authorised Officer Christine Tumney (NSW Food Authority) v Nutricia Australia Pty Limited - [2007] NSWSC 1215

No judgment structure available for this case.

CITATION: Authorised Officer Christine Tumney (NSW Food Authority) v Nutricia Australia Pty Limited [2007] NSWSC 1215

HEARING DATE(S): 9 October 2007

JUDGMENT DATE :
2 November 2007

JUDGMENT OF: James J

DECISION: 1. Defendant’s application of 11 September 2007; Set aside paras 3 and 5(c) of the plaintiff’s notice to produce to the defendant of 23 August 2007.; Dismiss the application to set aside the notices given pursuant to s 37 of the Food Act on 4 and 6 September 2007.; 2. Defendant’s application of 14 September 2007; Set aside the last two notices purportedly given pursuant to s 37 of the Food Act on 13 September 2007 (the Woolworths notices).; Dismiss the defendant’s application to set aside the first notice given pursuant to s 37 of the Food Act on 13 September 2007.; 3. The plaintiff’s application; Dismiss the application to set aside parts of the defendant’s notice to produce.; Stand over the rest of the application.

CATCHWORDS: Food Act 2003 - authorised officers - functions of authorised officers - contempt of court - use of statutory power to obtain advantage in pending proceedings not obtainable under rules of court

LEGISLATION CITED: Australian Securities and Investments Commission Act
Clean Waters Act
Criminal Procedure Act
Evidence Act
Food Act 2003
Trade Practices Act

CASES CITED: Australian Securities and Investments Commission v Elm Financial Services Pty Ltd (2004) 186 FLR 295
Environment Protection Authority v Caltex Refining Co Pty Ltd (1992-1993) 178 CLR 477
Pioneer Concrete (Vic) Pty Ltd v Trade Practices Commission (1982-1983) 152 CLR 460
The Queen v De Simoni (1980-1981) 147 CLR 383

PARTIES: Authorised Officer Christine Tumney (NSW Food Authority) v Nutricia Australia Pty Limited

FILE NUMBER(S): SC 13664/07; 13666/07; 13669/07; 13678/07

COUNSEL: M Joseph SC / MP Cahill / APL Naylor - Plaintiff
RT Beech-Jones SC / A Mitchellmore - Defendant

SOLICITORS: Moray & Agnew - Plaintiff
Gilbert & Tobin - Defendant

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

JAMES J

FRIDAY 2 NOVEMBER 2007

13664/07 AUTHORISED OFFICER CHRISTINE TUMNEY OF THE NSW FOOD AUTHORITY v NUTRICIA AUSTRALIA PTY LTD
JUDGMENT

1 HIS HONOUR: Christine Tumney an authorised officer of the New South Wales Food Authority, a body corporate constituted under Pt 9 of the Food Act 2003 has brought 13 proceedings by way of summonses filed on 20 July 2007 against Nutricia Australia Pty Ltd (“Nutricia” or “the defendant”) in the summary criminal jurisdiction of the Supreme Court under Pt 5 of Ch 4 of the Criminal Procedure Act.

2 In six of the summonses (nos 13664/07, 13665/07, 13666/07, 13669/07, 13669/07, 13670/07 and 13671/07) it is alleged that Nutricia contravened s 21(2) of the Food Act, in that it sold food that did not comply with a requirement of the Australia New Zealand Food Standards Code relating to that food. Section 21(2) of the Food Act provides that a person must not sell any food that does not comply with a requirement of the Food Standards Code that relates to that food.

3 In summonses 13664/07 and 13669/07 the food which it is alleged Nutricia sold is described as “Nutricia Karicare Gold Plus Infant Formula” (which I will refer to as “infant formula”). In summonses 13665/07 and 13670/07 the food which it is alleged Nutricia sold is described as “Nutricia Karicare Gold Plus Follow On formula” (which I will refer to as “follow on formula”) and in summonses 13666/07 and 13667/07 the food which it is alleged Nutricia sold is described as “Nutricia Karicare Gold Plus Toddler Nutritional Supplement” (which I will refer to as “toddler formula”).

4 In summonses 13664/07 and 13665/07 it is alleged that the Food Standards Code 2.9.1 applied to the infant formula in question, that the formula was an “infant formula” within Standard 2.9.1, that a substance fructo-oligosaccharide (“FOS”) was a nutritive substance within cl 6(1) of Standard 2.9.1 and that the formula sold by the defendant contained FOS, contrary to cl 6(1) of Standard 2.9.1, in that the Standard did not expressly permit the addition of FOS to infant formula and FOS was not naturally present in the defendant’s formula. Clause 6(1) of Standard 2.9.1 provides, so far as is relevant, that “a …nutritive substance must not be added to infant formula product unless — (a) expressly permitted by the Code or (b) it is naturally present in an ingredient of the infant formula product.

5 In summons 13666/07 it is alleged that Food Standards Code 1.1.1 applied to the defendant’s formula, that FOS was a nutritive substance within Standard 1.1.1 and that the formula sold by the defendant contained FOS, contrary to cl 9 of Standard 1.1.1, in that Standard 1.1.1 did not expressly permit the addition of FOS and FOS was not naturally present in an ingredient of the defendant’s formula. Clause 9 of Standard 1.1.1 provides that nutritive substances (as defined in cl 1 of the Standard) must not be added to food unless expressly permitted by the Australia New Zealand Food Standards Code.

6 The summonses in proceedings 13669/07 and 13670/07 are in substantially similar terms to the summonses in proceedings 13664/07 and 13665/07 respectively, except that the substance which it is alleged was a nutritive substance within cl 6(1) of Standard 2.9.1 and which it is alleged the formula sold by the defendant contained in contravention of cl 6(1) of Standard 2.9.1 was galicto-oligosaccharide (“GOS”).

7 The summons in proceedings 13671/07 is in substantially similar terms to the summons in proceedings 13666/07, except that the substance which it is alleged was a nutritive substance within Standard 1.1.1 and which it is alleged the formula sold by the defendant contained, contrary to cl 9 of Standard 1.1.1, was GOS.

8 In the remaining seven summonses (nos 13672/07, 13673/07, 13674/07, 13675/07, 13676/07, 13677/07 and 13678/07) it is alleged that Nutricia contravened s 21(3) of the Food Act, in that it sold food being a formula for infants which was labelled in a manner that contravened a provision of the Food Standards Code. Section 21(3) of the Food Act so far as is relevant, provides that a person must not sell any food that is labelled in a manner that contravenes a provision of the Food Standards Code.

9 In each of these seven summonses it is alleged that the Food Standards Code 1.1A.2 applied to the formula in question, that the formula as sold by the defendant was labelled with certain words and that the words on the label constituted a “claim”, contrary to cl 3(a) of Standard 1.1A.2. Clause 3(a) of Standard 1.1A.2 provides that, save where otherwise expressly prescribed by the Code, any label on a package containing food shall not include a claim for therapeutic or prophylactic action or a claim described by words of similar import.

10 In all the summonses it is alleged that sales of the defendant's products occurred between a date in February 2007 and a date in June 2007 and that the sales were to the National Distribution Centre of Woolworths.

11 A number of applications by notice of motion were made by one or other of the parties and it was these applications which came before me for determination. The applications were:-

1. An application by the defendant dated 11 September 2007 seeking to set aside parts of a notice to produce served by the plaintiff on the defendant on 23 August 2007 and seeking various forms of relief in relation to notices dated 4 September 2007 and 6 September 2007 served by the plaintiff on the defendant purportedly pursuant to s 37 of the Food Act.

2. An application by the defendant dated 14 September 2007 seeking various forms of relief in relation to further notices dated 13 September 2007 served by the plaintiff on the defendant purportedly pursuant to s 37 of the Food Act.

3. An application by the plaintiff seeking certain directions about the future conduct of the proceedings and seeking to set aside parts of a notice to produce served by the defendant on the plaintiff on 23 August 2007.

12 Most of the hearing before me was devoted to the defendant’s applications regarding the notices served by the plaintiff on the defendant purportedly pursuant to s 37 of the Food Act (that is, part of the application of 11 September 2007 and all of the application of 14 September 2007) and I will deal with these applications first.

13 It will be convenient to refer to the notices served by the plaintiff as “s 37 notices”, the adoption of such a term by me in no way involving any pre-judging of the validity of the notices, and to refer to the defendant’s applications as applications “to set aside” the s 37 notices, although other forms of relief were also claimed by the defendant.

The applications by the defendant to set aside the plaintiff’s s 37 notices

14 Before coming to the s 37 notices themselves, it is convenient to set out or summarise some of the provisions of the Food Act. In s 3 the objects of the Act are stated to include:-

“(a) to ensure food for sale is both safe and suitable for human consumption,

(b) to prevent misleading conduct in connection with the sale of food,

(c) to provide for the application in this State of the Food Standards Code.”

15 As I have already indicated, the New South Wales Food Authority is constituted under Pt 9 of the Act. Section 108 sets out the functions of the Food Authority. Section 109 provides that the Food Authority is, in exercise of its functions, subject to the control and direction of the Minister, “except in relation to … (c) decisions whether to institute criminal proceedings in a particular case”.

16 Under s 109E of the Act the Food Authority may delegate to, inter alios, an authorised officer any function of the Food Authority under the Act, apart from certain specified functions, none of which are relevant to the present proceedings.

17 A person can be appointed as an “authorised officer” under Div 3 of Pt 9 of the Act. The heading to s 37 is “Powers of authorised officers”. The opening words of s 37(1) are:-

“For the purposes of this Act, an authorised officer may, at any reasonable time, do any one or more of the following:”.

18 The powers of authorised officers set out in s 37 which were principally referred to in argument on the applications were the powers to:-

“(o) require a person to provide information or answer questions in connection with the authorised officer’s functions under this Act or to produce any record, document or thing that an authorised officer is authorised to examine under this Act,”

19 Section 38 of the Act provides:-

38 Power of seizure

20 Section 39 of the Act provides that an authorised officer may apply for a search warrant, if he has reasonable grounds for believing that a provision of the Act or of a regulation under the Act has been or is being contravened on premises.

21 Section 40 of the Act provides that it is a criminal offence to fail to comply without reasonable excuse with a requirement of an authorised officer duly made.

The s 37 notices

22 What were said to be copies of the s 37 notices served by the plaintiff on the defendant were exhibited to affidavits of Elizabeth Grinston, a solicitor employed by the defendant’s solicitors having the day-to-day carriage of the proceedings for the defendant and were annexed to an affidavit by Norman Abraham Correy, the solicitor for the plaintiff. The two sets of documents do not appear to me to be identical in all respects. The documents exhibited to Ms Grinston’s affidavits were the documents generally referred to in argument at the hearing and in this judgment I will proceed on the basis that they are true copies of the notices.

23 The first notice with which I am concerned (exhibit EG 3 pp 26-30) was dated 4 September 2007 and served the same day.

24 The notice of 4 September 2007 was not in fact the first notice given to Nutricia, purportedly pursuant to s 37. A number of earlier notices had been given but all of these notices had been withdrawn by the Food Authority.

25 The notice of 4 September 2007, like all the later notices, was given by an authorised officer named Alan Edwards. No point was sought to be taken by counsel for Nutricia that the notices were given by an authorised officer other than the authorised officer Ms Tumney by whom the criminal proceedings had been brought.

26 With the notice of 4 September 2007 was a covering letter from Mr Edwards dated 4 September 2007 in which he said:-

“The NSW Food Authority is investigating whether Nutricia Australia Pty Limited has committed any further offences contrary to the Act.

Information given and/or documents produced in response to the enclosed Notice may be used against Nutricia Australia Pty Limited if further charges are preferred under the Act.”

27 The notice of 4 September 2007, like all of the other notices served by the plaintiff on the defendant, is lengthy (even though it is in fact the shortest) and I will not set out its terms in full.

28 The notice commenced with a statement by Mr Edwards that he believed on reasonable grounds that Nutricia was capable of providing information and/or documents that might be necessary to ascertain whether an offence under the Act had been committed by Nutricia as a result of sales of infant formula and follow on formula in New South Wales during the period from 1 January 2007 to 19 July 2007 and required Nutricia to answer the questions subsequently set out and to produce the documents subsequently described.

29 The questions set out in the notices included whether Nutricia had sold the products in New South Wales during the period; if so, details of the sales; whether the products sold contained FOS and, if so, further questions about FOS in the products; whether the products sold contained GOS and, if so, further questions about GOS in the products.

30 The second notice (exhibit EG 3 pp 35-52) and the third notice (exhibit EG 3 pp 53-71) were both dated 6 September 2007and served the same day. Also served with the notices was a covering letter from Mr Edwards of 6 September 2007, which contained the same paragraphs as the paragraphs in the letter of 4 September 2007 which I have quoted.

31 Both the second notice and the third notice asked questions about sales by Nutricia to companies in the Coles Group of companies between 1 December 2006 and 1 September 2007. The principal difference between the second notice and the third notice was that the second notice asked questions about the product toddler formula and the third notice asked questions about the products infant formula and follow on formula.

32 Each of the notices was lengthy. The questions set out in each notice included whether Nutricia had sold the product or products in New South Wales during the period to any one of a number of companies in the Coles Group and, if so, details of the sales. Questions were then asked about the ingredients of the products sold. These questions included questions about FOS (question 5), questions about GOS (question 6), questions about polysaccharides (question 7), questions about combinations of FOS and/or GOS and/or polysaccharides (question 8). Questions were asked about whether a product had been sold with labels containing certain statements about the product and whether the individual statements were true and, if so, “how does this occur” (questions 9 and following).

33 The fourth notice (exhibit EG 4 pp 2-17) was dated 13 September 2007 and served the same day.

34 Served with the notice was a covering letter from Mr Edwards of 13 September 2007, in which he said:-

“I enclose, by way of service, a further notice issued by me today pursuant to s 37 of the Food Act 2003 (NSW) (“the Act”).

The NSW Food Authority is investigating whether Nutricia Australia Pty Limited has committed any further offences contrary to the Act.

Please note that any information given and/or documents produced in response to the enclosed Notice:

1. may be used against Nutricia Australia Pty Limited in relation to further charges if and when preferred, and

2. will not be used in relation to the charges presently before the court.”

35 The products referred to in this notice were infant formula and follow on formula.

36 The notice commenced with a statement by Mr Edwards that he believed on reasonable grounds that Nutricia was capable of providing information and/or documents that might be necessary to ascertain whether an offence under the Act had been committed by Nutricia as a result of sales of infant formula and follow on formula in New South Wales during the period 1 December 2006 and 1 September 2007 and required Nutricia to answer the questions subsequently set out and to product the documents subsequently described.

37 The questions set out in the notice included whether Nutricia had sold the products in New South Wales during the period and, if so, details of the sales; who had been the managing director and the other directors of Nutricia during the period; whether the managing director had been aware of certain matters, including whether the products contained FOS and GOS and whether the managing director had been involved in certain steps in the selling of the products; similar questions in relation to any other directors of Nutricia; similar questions in relation to two named persons; questions in relation to an application to amend the Food Standards Code, a copy of which was annexed to the notice; questions about pieces of artwork which had previously been produced by Nutricia to the Food Authority in compliance with notices to produce; questions about importation of infant formula into Australia by Nutricia; and questions about advertising of infant formula products by Nutricia.

38 The fifth notice (exhibit EG 4 pp 18-35) and the sixth notice (exhibit EG 4 pp 36-54) were both dated 13 September 2007 and served the same day.

39 There was no covering letter with these notices. In a letter dated 18 September 2007 from the solicitors for the Food Authority to the solicitors for the defendant the solicitors for the Food Authority said that “the information sought by these notices relates to current charges” and in their written submissions counsel for the plaintiff confirmed that these two notices “relate to the charges presently before the Court and were issued for the purpose of obtaining information for use as evidence in the current proceedings”.

40 The product referred to in the fifth notice is toddler formula and the products referred to in the sixth notice are infant formula and follow on formula.

41 Each of these two notices commenced with a statement by Mr Edwards that he believed on reasonable grounds that Nutricia was capable of providing information and/or documents that might be necessary to ascertain whether an offence under the Act had been committed by Nutricia as a result of sales of the product or products.

42 In each notice Nutricia was asked whether it had sold the product or products identified in the notice during the period 5 February 2007 to 20 June 2007 to Woolworths. The following questions in both notices were identical or virtually identical, except that different questions were asked about the labels with which the products were sold.

43 Each of the notices was in identical, or virtually identical, terms to those of the corresponding notice asking questions about sales by Nutricia to Coles, that is to say, the terms of the fifth notice asking questions about sales of toddler formula to Woolworths were identical, or virtually identical, to those of the second notice asking questions about sales of toddler formula to Coles and the terms of the sixth notice asking questions about sales of infant formula and follow on formula to Woolworths were identical, or virtually identical, to those of the third notice asking questions about sales of the same products to Coles.

The submissions of the parties

44 In written submissions two principal submissions were made by counsel for the defendant, namely:-

1. On a proper construction of the Food Act the Food Authority or its authorised officers did not have power to issue the s 37 notices against Nutricia, in circumstances where the Food Authority had already commenced criminal proceedings against Nutricia and, therefore, as the Food Authority or its authorised officers did not have power to issue the notices, the issuing of the notices constituted a contempt of court.

2. Even if, on the proper construction of the Food Act, the Food Authority or its authorised officers did have power to issue the notices, notwithstanding that the Food Authority had commenced criminal proceedings against Nutricia, the issuing of the notices was an attempt by the Food Authority to obtain a procedural advantage in the criminal proceedings which it could not obtain under the rules of the court in which the criminal proceedings had been brought and that, therefore, the issuing of the notices had the purpose or effect of interfering with the course of justice and constituted a contempt of court.”

45 The two submissions on behalf of the defendant would raise issues similar to those considered by Austin J in Australian Securities and Investments Commission v Elm Financial Services Pty Ltd (2004) 186 FLR 295.

46 It was accepted by counsel for Nutricia that the two submissions were, to some extent, interrelated and, indeed, the second submission, as it was developed by counsel, was said to rest on a principle of statutory construction.

47 In the course of oral argument at the hearing counsel for the defendant said that he did not press the first of these submissions (transcript p 43 lines 40-58). Counsel did continue to press the second submission, which I will refer to as “the contempt submission”.

48 Later in the course of oral argument and partly as a result of a remark made by me, counsel for the defendant did make a submission about the proper construction of provisions of the Food Act, which was separate from either of the principal submissions made in his written submissions and which I will refer to as “the further construction submission”. This submission was that the power of an authorised officer under s 37(1)(o) of the Act to require a person to provide information or answer questions is limited by the words in para (o) “in connection with the authorised officer’s functions under this Act”, that it is not a function of an authorised officer under the Act to institute (or conduct) criminal proceedings for offences under the Act and therefore requiring a person to provide information or answer questions for the purposes of criminal proceedings under the Act could not be “in connection with” any function of an authorised officer under the Act and was not authorised by s 37(1)(o).

49 It was submitted by counsel for Nutricia that the present proceedings had been instituted by Ms Tumney, not under the Act, but under s 14 of the Criminal Procedure Act, which provides that a prosecution in respect of any offence under an Act may be instituted by any person, unless the right to institute the prosecution is expressly conferred by that Act on a specified person or class of persons. Counsel submitted that the Food Act did not contain any provision expressly conferring on any person or class of persons the right to institute prosecutions for offences under the Food Act.

50 In response to these submissions counsel for the plaintiff submitted that wide powers were conferred on an authorised officer by the various paragraphs of s 37(1) and that these paragraphs should be interpreted in the light of the opening words of s 37(1), “for the purposes of this Act”, which referred to the objects of the Act as set out in s 3 of the Act. When regard was had to these matters, it should be concluded that requiring a person to provide information or answer questions for the purposes of criminal proceedings under the Act was in connection with functions of an authorised officer under the Act.

51 It was also submitted by counsel for the plaintiff that, within the terms of s 14 of the Criminal Procedure Act, the right to institute a prosecution for an offence under the Food Act was expressly conferred by s 109(c) of the Act on the Food Authority and that under s 109E of the Act this function of the Food Authority could be delegated to an authorised officer, whereupon it would become a function of the authorised officer.

52 I will now summarise, fairly succinctly, the submissions made by counsel for, and against, the contempt submission.

53 It was submitted by counsel for the defendant that there is a principle of statutory construction that a power conferred in general terms on a regulatory authority or its officers will not be construed as including a power to obtain an advantage in court proceedings instituted by the authority, which it could not obtain under the procedural rules of the court in which the proceedings have been brought. It was submitted that this principle of statutory construction is a “free standing” principle; that it does not depend on the defendant in the court proceedings instituted by the authority having a privilege against self incrimination or on the court in which the proceedings have been brought being a federal court or being otherwise subject to principles derived from the separation of powers under the Commonwealth Constitution.

54 It was then submitted by counsel for the defendant that the powers conferred by the Food Act on the Food Authority and an authorised officer of the Food Authority were conferred in general terms, that the giving of the s 37 notices to Nutricia amounted to attempts to obtain an advantage in the court proceedings which had been instituted against Nutricia, which the Food Authority or its officer could not obtain under the procedural rules of the court in which the proceedings have been brought and, therefore, the giving of the notices did not fall within the statutory power properly construed and amounted to a contempt of court.

55 Counsel for the plaintiff submitted that paras (o) and (q) of s 37 are expressed in wide terms and should be interpreted in accordance with their terms and so as to give effect to the purposes of the Act.

56 Counsel for the plaintiff disputed that there is any principle of statutory construction as contended for by counsel for the defendant and explained authorities sought to be relied on by counsel of the defendant as depending upon the existence of a privilege against self-incrimination or federal constitutional principles. However, in Environment Protection Authority v Caltex Refining Co Pty Ltd (1992-1993) 178 CLR 477 the High Court had held that the privilege against self-incrimination did not apply to corporations, such as the defendant, and now s 187 of the Evidence Act provides that a body corporate has no privilege against self-incrimination. It was submitted that federal constitutional principles springing from the separation of powers between the executive and the judiciary had no application in the present proceedings.

57 Counsel for the plaintiff said that a distinction could be drawn between the fifth and sixth notices, which the Food Authority acknowledged had been given for the purposes of the court proceedings, and the other notices, which counsel submitted had been given as part of an ongoing investigation by the Authority into whether the defendant had committed other offences, apart from those already charged. Even if there was a principle of statutory construction as contended for by counsel for the defendant, these other notices could not be regarded as an attempt to obtain an advantage in the court proceedings which the Authority had brought.

58 Counsel for the plaintiff submitted that, in any event, any advantage the Food Authority might obtain from the giving of the notices could be obtained under Pt 75 of the Supreme Court rules and, in particular, under the power of a court under Pt 75 r 11(4)(a) to make orders and give directions.

Environment Protection Authority v Caltex Refining Co Pty Ltd

59 The submissions made by both counsel made frequent references to parts of the judgments of the judges who formed the majority in Caltex.

60 In Caltex a corporation had been charged with an offence under the Clean Waters Act. The prosecutor, the Environment Protection Authority, served a notice on Caltex purportedly pursuant to s 29(2)(a) of the Clean Waters Act, which empowered an authorised officer to require an occupier of premises to produce documents, requiring the production of documents relating to the alleged offence.

61 It was held by a majority of the High Court (Mason CJ, Brennan, Toohey and McHugh JJ) (Deane, Dawson and Gaudron JJ dissenting) that a corporation was not entitled to a privilege against self-incrimination. It was further held by the majority that a notice could be served on a corporation pursuant to s 29(2)(a) to obtain evidence against the corporation, notwithstanding that criminal proceedings had been commenced against the corporation.

62 Most of the judgments in Caltex are devoted to the determination of the question whether a corporation has a privilege against self-incrimination. The parts of the judgments which were frequently referred to in argument in the present case are comparatively brief and I propose to set them out in full.

63 At pp 506-507 Mason CJ and Toohey J in their joint judgment said:-

The s 29 notice

Once it is accepted that, by resort to the court's own process in the form of a notice to produce, it is possible to compel production of the information sought during the currency of the proceedings, there was no reason for construing s 29(2)(a) of the Act restrictively so that it becomes subject to a limitation which is not applicable to the notice to produce. As the court's own process can be used to compel production, resort to the statutory power for the same purpose cannot amount to an abuse of process.

There is nothing in the language of s 29(2)(a) which would support the restrictive interpretation. It would be artificial to say that it is permissible to issue a notice requiring production of documentary material with a view to ascertaining whether a breach of the statute or a condition of a licence has taken place, but it is impermissible to issue a notice with a view to providing evidence of such a breach. If it be permissible to issue such a notice for that purpose before the commencement of proceedings, it must be permissible to do so after proceedings have commenced.”

64 At pp 516-518 Brennan J said:-

Melbourne Steamship

Hammond

The significance of denying the availability of the privilege against self-incrimination to a corporation lies in the inability of the corporation to resist the exercise of a statutory power from which a natural person is immune. The implication which is made in construing a statute conferring an investigative power is that the exercise of the power will not compel a person to incriminate himself unless the statute otherwise prescribes expressly or by necessary intendment. That implication does not protect corporations. Nor is there any other fundamental bulwark of liberty which qualifies in any material way a statutory grant of an investigative power. As we shall see, the privilege against self-exposure to a penalty affords no such qualification. Accordingly, the power conferred by s 29(2)(a) may be exercised against corporations according to the unqualified terms of that provision.

A final question relating to the s 29(2)(a) notice should be considered. Was the use of the notice an abuse of the process of the Land and Environment Court? There is no abuse of a court's process in a party's taking advantage of a legitimate means of obtaining evidence to be used in pending litigation. If the documents to be produced pursuant to the notice had been seized under a search warrant, it could not be suggested that the use of the search warrant was an abuse of process. Nor can the service of the notice under s 29(2)(a) be so described.”

65 At pp 557-559 McHugh J said:-

The s 29 notice

It is not open to doubt that a notice may be issued under s 29(2)(a) for the purpose of obtaining evidence to support a prosecution under the Clean Waters Act. Nor is there any reason to suppose that the power cannot be used to obtain evidence to support the prosecution of an offence against the State Pollution Control Commission Act. Nothing in the terms of s 29(2)(a) suggests that the power conferred by that provision to obtain evidence against a person is spent once proceedings against that person have been commenced. Why then should there be read into this statutory provision the limitation that the power can never be used after the commencement of a prosecution?

Melbourne Steamship Co Ltd v Moorehead

Brambles Holdings Ltd v Trade Practices Commission

Huddart Parker & Co Pty Ltd v Moorehead

.

Pioneer Concrete (Vic) Pty Ltd v Trade Practices Commission,

Obtaining evidence under a statutory power for the purpose of assisting a party in pending litigation does not necessarily constitute an interference with the procedures of the courts. The evidence gathering procedures of a party are not limited to the use of court procedures. No interference with the processes of the courts or the course of justice occurs merely because a party avails itself of a statutory power to obtain evidence during the course of pending litigation. The mere use of such a power during the pendency of litigation is not a contempt of court even when the sole purpose of the exercise of the power is to assist a party to obtain evidence for use in that litigation. To constitute a contempt, the party must exercise the power in such a way that it interferes with the course of justice. Thus, there might be a contempt if the exercise of a statutory power ``would give such a party advantages which the rules of procedure would otherwise deny him'’. But something more is required than that the party exercised the power for the purpose of obtaining evidence for use in pending litigation.

In the present case, use of the power under s 29(2)(a) did not constitute a contempt of court. Because a corporation cannot claim the privilege against self-incrimination, use of the s 29 power did not give the prosecutor any advantage which the rules of court otherwise denied to it. Accordingly, in my opinion, the power under s 29(2)(a) was not used for an improper purpose. The notice given under that paragraph was a valid notice.”

Decision

The further construction submission

66 I do not accept the submission made by counsel for the plaintiff that s 109(c) of the Food Act amounts to an express conferring on the Food Authority of the right to institute a prosecution for an offence under the Food Act, within the terms of s 14 of the Criminal Procedure Act, and I reject the submission made by counsel for the plaintiff to the effect that a function of instituting criminal proceedings was conferred by the Food Act on the Food Authority, which could be delegated by the Food Authority to an authorised officer and by this means become a function of an authorised officer under the Act, within s 37(1)(o).

67 I have, however, concluded that the requirements in the notices to answer questions can be said to have been “in connection with” functions of an authorised officer under the Act, even though it is not a function of an authorised officer under the Act to institute criminal proceedings for offences under the Act. The expression “in connection with” is an expression of wide import and merely requires some connection between a requirement to answer questions and some function of an authorised officer under the Act. The functions of an authorised officer under the Act include, but are not limited to, the wide powers conferred by the various paragraphs of s 37(1), which, as counsel for the plaintiff submitted, are to be interpreted so as to give effect to the purposes of the Act, which include providing for the application in New South Wales of the Food Standards Code. As the notices are drafted, the requirement to answer the questions asked in the notices is linked to the power under para (o) to make such investigations and inquiries as may be necessary to ascertain whether an offence under the Act has been or is being committed.

68 I reject the further construction submission made by counsel for the defendant.

The contempt submission

69 As previously indicated in this judgment, counsel for the defendant contended that there is a principle of statutory construction that a statutory power conferred in general terms on a regulatory authority or one of its officers will not be construed as including a power to obtain an advantage in court proceedings instituted by or on behalf of the authority, which could not be obtained under the procedural rules of the court in which the proceedings have been brought. It was conceded by counsel for the defendant that a statutory provision can authorise what would otherwise be a contempt of court, but only if such a result is specifically or clearly provided for, and it was submitted that paras (o) and (q) of s 37(1) of the Act are expressed only in general terms.

70 Counsel for the defendant relied heavily on parts of the judgment of McHugh J in Caltex especially the second last paragraph in the part of the judgment which I have quoted. In this paragraph McHugh J said that it is not sufficient to amount to an interference with the procedure of a court that a party uses a statutory power to obtain evidence to assist it in pending litigation in the court or even that the sole purpose of exercising the statutory power is to obtain such evidence. His Honour said that to constitute a contempt of court a party must exercise a statutory power in such a way that it interferes with the course of justice and that there “might be” a contempt, if the exercise of a statutory power would give such a party advantages which the rules of procedure would otherwise deny the party.

71 It was pointed out by counsel for the defendant that this part of McHugh J’s judgment occurred, after his Honour had concluded, at p 556, that a corporation cannot claim the privilege against self-incrimination and I accept the submission by counsel for the defendant that this part of his Honour’s judgment does not depend on a corporation being able to claim a privilege against self-incrimination.

72 It is to be noted that McHugh J said only that, in the circumstances stated by him, there “might be” a contempt, not that there necessarily would be a contempt. In Caltex McHugh J did not have to determine whether a contempt had actually occurred, because the use of the statutory power under s 29 of the Clean Waters Act did not give the prosecutor any advantage which the rules of the Land and Environment Court would otherwise have denied it.

73 In his judgment in Caltex McHugh J referred to the judgment of Gibbs CJ in Pioneer Concrete (Vic) Pty Ltd v Trade Practices Commission (1982-1983) 152 CLR 460, a case concerning notices under s 155 of the Trade Practices Act. Section 155 of the Trade Practices Act conferred a power on the Trade Practices Commission to serve notices requiring a person to furnish information or produce documents or appear before the Commission to give evidence. It was held by the High Court in Pioneer Concrete that the power under s 155 of the Trade Practices Act was capable of being exercised by the Commission, even after proceedings had been instituted under the Trade Practices Act, such proceedings having been instituted by a person other than the Commission.

74 At pp 467-468 of his judgment in Pioneer Concrete Gibbs CJ said:-

Brambles Holdings Ltd v Trade Practices Commission

Victoria v Australian Building Construction Employees’ and Builders Labourers’ Federation

75 In his submissions counsel for the defendant focused on the sentence in the judgment in which the Chief Justice said that he was “inclined” to think that, if a power was used to assist a party in proceedings already pending, in a way which would give such a party advantages which the rules of procedure would otherwise deny him, there would be a contempt of court.

76 In his judgment in Pioneer Concrete Mason J said at p 473:

“A statute expressed in general terms should not be construed so as to authorise the doing of any act which amounts to a contempt of court.”

77 I will now turn to the judgments of some of the other judges in Caltex.

78 Mason CJ and Toohey J in their joint judgment in Caltex quoted a part of Gleeson CJ’s judgment in the Court of Criminal Appeal in which Gleeson CJ had said inter alia that the statutory power could not be used to enable a prosecutor to circumvent limitations imposed by court procedures on the power to compel the production of documents.

79 Mason CJ and Toohey J commented that Gleeson CJ was interpreting the statutory power under s 29(2) of the Clean Waters Act from a perspective different from that of Mason CJ and Toohey J, in that Gleeson CJ had considered that the privilege against self-incrimination was available to a corporation and that s 29 of the Clean Waters Act abrogated the privilege.

80 Mason CJ and Toohey J then held that, because the procedural rules of the Land and Environment Court permitted the giving of notices requiring the production of documents, an exercise of a statutory power for the same purpose could not amount to an abuse of the process of the Land and Environment Court. Once that this was accepted, there was no reason for interpreting the statutory power restrictively so that it became subject to limitations which did not apply to the power conferred by the Land and Environment Court’s rules.

81 It seems to me that the joint judgment of Mason CJ and Toohey J neither rejects, nor gives clear support, to the principle tentatively stated by McHugh J and by Gibbs CJ in Pioneer Concrete.

82 In the final paragraph of the part of his judgment which I have quoted Brennan J considered whether the giving of a notice pursuant to s 29(2)(a) of the Clean Waters Act was an abuse of the process of the Land and Environment Court. His Honour held that it was not an abuse of a court’s process to take advantage of a “legitimate” means of obtaining evidence to be used in pending litigation. I infer from the following sentence in his Honour’s judgment that his Honour considered that the serving of the statutory notice was a “legitimate” means of obtaining evidence, because the documents required to be produced by the notice could have been obtained by another means, by seizure under a search warrant.

83 Because there is no clear determination by the judges who formed the majority in Caltex as to whether there is, or is not, a principle of statutory construction as contended for by counsel for the defendant, I consider that it is permissible to have some regard to the joint judgment of the three dissenting judges in Caltex, even though they reached the conclusion, which was rejected by the majority, that the privileging against self-incrimination was available to a corporation. At p 537 the three dissenting judges in a passage in their judgment which does not appear to me to depend on their view that the privilege against self-incrimination is available to a corporation:-

“If it requires clear language or a clear implication to exclude the privilege against self-incrimination, then legislation must surely be no less clear before it can be construed as empowering a prosecutor to obtain compulsorily from the defendant, after the prosecution has been commenced, the evidence which it requires to discharge the onus cast upon it to prove its own case. Furthermore, if s 29(2)(a) could be used after a prosecution had been launched, then the procedures of the Clean Waters Act would cut across the procedures specifically provided for the conduct of a prosecution by the rules of court.”

84 In Caltex the judges in the majority held that the procedures of the Act had not in fact cut across the procedures provided by rules of court, because the procedures provided by the rules of court would have enabled the same result to be achieved.

85 In ASIC v Elm Financial Services ASIC had brought proceedings in which it sought orders that certain defendants who were corporations be wound up and that certain other defendants who were individuals be disqualified from managing any corporation.

86 After commencing the proceedings ASIC continued to investigate the operations of the corporate defendants. ASIC issued notices under s 19 of the Australian Securities and Investments Commission Act that an individual attend for examination and that a corporate defendant produce certain documents. Some of the defendants sought to restrain ASIC from pursuing these notices.

87 At para 44 of his judgment (see also paras 1 and 34) Austin J identified as a question he had to determine:-

“If ASIC has the power to proceed with the notices (whether) it should be restrained from doing so because its purpose is to use its powers to obtain information for use in the proceeding to which it is a party, in a manner that will give it an advantage beyond what is permitted to a litigant by the rules of court, and therefore in contempt of court, or there is a real risk that the continuing use of its powers will have that effect.”

88 After conducting an examination of the evidence Austin J concluded at para 77:-

“The evidence before me does not support a finding that ASIC wishes to continue its investigations for the dominant purpose of gathering evidence to be used against the defendants in the proceeding. It does not support a finding that ASIC wishes to continue with the investigation for any purpose of gaining an advantage in respect of the proceeding that would not be available to it under the rules of court.”

89 Accordingly, Austin J would appear to have accepted that there would, or might have been, a contempt of court, if a statutory power had been exercised for the dominant purpose of obtaining evidence to be used in pending proceedings, in such a way as to gain an advantage which ASIC could not have obtained under the rules of the court in which the proceedings were pending.

90 I consider that I should accept that, if a statutory power conferred in general terms is sought to be exercised by a party to pending court proceedings for the sole purpose or a dominant purpose of obtaining evidence to be used in the pending proceedings and in such a way as to obtain an advantage which could not be obtained under the procedural rules of the court in which the proceedings are pending, then there would be a contempt of the court in which the proceedings are pending; and, if the statutory power is conferred only in general terms and does not clearly authorise such an exercise, the statutory power will be construed so as not to authorise such a purported exercise of the power. Alternatively, such a purported exercise of the statutory power will amount to a contempt or an abuse of process, which the court in which the proceedings have been brought will restrain or, at least, not facilitate.

91 I will now consider whether the giving of the notices by the Authority should be regarded as an attempt to obtain an advantage which could not be obtained under the procedural rules of the Court.

92 It was not suggested by counsel for the plaintiff that the giving of the notices to the defendant to answer the questions asked in the notices was not tantamount to the administering of interrogatories, and this is clearly the case.

93 It was common ground between the parties that Div 2 of Pt 75 of the Supreme Court Rules 1970 applies to the criminal proceedings brought against the defendant.

94 By virtue of r 6 in Div 2 of Pt 75 certain provisions of the Uniform Civil Procedure Rules 2005 are made applicable to such proceedings. The provisions made applicable include r 34.1, which enables a party by notice served on another party to require the production of a specified document or thing. The provisions of the Uniform Civil Procedure Rules made applicable by r 6 do not include Pt 22 of the Uniform Civil Procedure Rules, which deals with interrogatories.

95 Division 2 of Pt 75 of the Supreme Court Rules does include r 11, which is headed “Pre-trial Procedures”. Under para (a) of sub-r (4) of r 11 a court may make orders and give directions for the just and efficient disposal of proceedings. Paragraph (b) of sub-r (4) provides that, without limiting the generality of para (a), a court may make orders and give directions relating to a number of specific matters, which do not include the administering of interrogatories.

96 It was submitted by counsel for the plaintiff that the power conferred on the Court under para (a) of r 11(4), not being limited to the specific matters listed in para (b) of the rule, would include a power to make orders or give directions for the administering and answering of interrogatories.

97 I do not consider that this submission should be accepted. In my opinion, the general power to make orders and give directions conferred by Pt 75 r 11(4)(a), in a part of the Rules dealing with criminal proceedings, cannot be construed as extending to a power to require a defendant in criminal proceedings to answer interrogatories administered by the prosecutor.

98 I note that under Pt 22 of the Uniform Civil Procedure Rules there is no right in a party to require another party to the proceeding to answer interrogatories, simply by the serving of a notice on the other party. A court order is required and a court is not to make an order that interrogatories be administered, unless the court is satisfied that the order is necessary at the time it is made. By contrast, under r 34.1 of the Uniform Civil Procedure Rules, which is incorporated by r 6 of Pt 75 of the Supreme Court Rules, a party can require the production of a specified document or thing, by serving a notice and without the need for any court order.

99 I conclude that the giving of the notices would confer on the Authority an advantage which it could not obtain under the procedural rules of the Court.

100 A question remaining is whether I should conclude that the Food Authority or its authorised officer was seeking to exercise the statutory powers under s 37 for the sole or dominant purpose of obtaining evidence for use in the pending proceedings.

101 As to the fifth and sixth notices, it was expressly acknowledged by the plaintiff’s solicitor and by the plaintiff’s counsel in written and oral submissions that these notices, which asked questions about sales by the defendant to Woolworths, were given for the purposes of the present proceedings. Hence, these notices fall within the principle I have stated earlier in this judgment. The powers conferred by s 37(1)(o) and s 37(1)(q) of the Food Act should be construed as not authorising the giving of the notices or, alternatively, the giving of the notices should be held to amount to a contempt of court or an abuse of process and I will give effect to this conclusion by making an order setting aside the notices.

102 As to the first four notices, counsel for the plaintiff submitted that I should accept that they were given, not for the sole or dominant purpose of obtaining evidence or information for use in the present criminal proceedings, but as part of an ongoing investigation by the Food Authority of the activities of the defendant, to ascertain whether the defendant has committed other offences.

103 It was accepted by counsel for the defendant, and seems to me to be clearly correct, that, on a proper construction of the Act, an authorised officer of the Food Authority continued to have the power to issue s 37 notices against the defendant as part of a continuing investigation, notwithstanding that the Food Authority had commenced criminal proceedings against the defendant.

104 The first four notices do not relate at all, or do not specifically relate, to the sales by the defendant to Woolworths which are the subject of the present proceedings.

105 Each of the notices was given with a covering letter in which an authorised officer of the Food Authority stated that the Food Authority was investigating whether the defendant had committed any further offences and that information given in response to the notice might be used against the defendant, “if further charges are preferred under the Act”. There is a strong implication that information given in response to a notice would not be used in the present proceedings. In the case of the fourth notice, there was an express assurance in the covering letter that information given in response to the notice would not be used in relation to the charges presently before the court.

106 It was submitted by counsel for the defendant that assurances given in the covering letters had no statutory basis and would not be binding on the Food Authority. However, the assurances having been given, it would be a serious breach of an obligation of a prosecutor, for the Food Authority or any of its officers to attempt to use the information given in answer to the questions in the first four notices in relation to the current charges.

107 It was submitted by counsel for the defendant that, even if answers to questions asked in the first four notices were not admitted into evidence on the trial of the present charges, it was inevitable that the Food Authority would derive some advantages in the current prosecutions from knowing the defendant’s answers to the questions in the first four notices. I accept that this would be so, but I consider that what Austin J said in para 79 of his judgment in ASIC v Elm Financial Services, mutatis mutandis, is apposite. His Honour said:-

“In all probability, a substantial amount of the information gathered in ASIC’s further investigation will be relevant to the proceeding and potentially evidence against one or more of the defendants. To that extent, I agree with counsel for the applicants that the information sought in the notices is “clearly relevant” … to the issues in the proceeding… but that level of connection and overlapping does not itself mean that the continuation of the investigation will amount to a misuse of the statutory powers or a contempt of court.”

108 I decline to grant any relief in relation to the first four notices.

The application by the defendant to set aside parts of the plaintiff’s notice to produce of 23 August 2007

109 The parts of the plaintiff’s notice to produce which the defendant sought to set aside were:-

3. All documents relating to any investigation, inquiry and/or analysis undertaken by the defendant or its agents as to any safety issues relating to the inclusion or proposed inclusion of FOS and/or inulin and/or GOS into infant formula products and formulated supplementary foods, including the Karicare Gold Plus range of products.

5. All documents (including letters, faxes, memos or other communications and any recording of such communications) from June 2006 to date sent by the defendant and/or its agents to and/or received by the defendant and/or its agents from:

Relating to:

110 During the hearing I was informed by counsel that I need not make any ruling at this stage with regard to para 5(b) (transcript p 85).

111 Paragraphs 3 and 5(c) of the notice to produce require the production of documents relating to safety issues.

112 It was submitted by counsel for the defendant that any such documents were irrelevant, because safety, or rather lack of safety, was not an element of the offences charged. Under s 14 of the Act it is an offence to sell food that a person knows is unsafe but no charge had been brought under s 14.

113 It was submitted by counsel for the plaintiff that evidence of knowledge on the part of the defendant that it had not been established that adding the nutritive substances to infant formula was safe, while not amounting to an offence under s 14 of the Act, might be relevant to the objective seriousness of the offences charged and would also be relevant to any defence of due diligence under s 26 of the Act.

114 I consider that I should set aside para 3 and para 5(c) of the notice to produce. Lack of safety is not an element of the offences charged. If the defendant is found guilty of one or more of the offences charged, then the objective seriousness of the offences will be relevant to penalty, provided that there is no infringement of the principle in The Queen v De Simoni (1980-1981) 147 CLR 383 but it is not relevant to proof of the offences charged. It may be that the documents can be required to be produced, if and when the defendant is found guilty of one or more of the offences charged.

115 Having regard to the nature of the offences charged under s 21(2) and s 21(3), I do not consider that the documents sought would be relevant to establishing or rebutting a defence of due diligence under s 26 of the Act.

The application by the plaintiff to set aside parts of the defendant’s notice to produce

116 Documents falling within the terms of the notice to produce had already been produced by the plaintiff to the defendant in compliance with a notice to produce given by the defendant to the plaintiff in earlier civil proceedings between the parties.

117 Counsel for the plaintiff did not object to the defendant’s legal representatives having access to the documents already produced in the civil proceedings for the purpose of the present criminal proceedings. However, counsel for the plaintiff did not wish to concede that the documents which have already been produced were all of the documents falling within the wide terms of the notice to produce in these proceedings.

118 This problem was overcome by counsel for the defendant conceding that the previous production by the plaintiff of documents in compliance with the notice in the civil proceedings did not amount to a concession by the plaintiff that the documents previously produced were all of the documents within the terms of the notice to produce given by the defendant in the present proceedings.

119 I released the defendant from its implied undertaking not to use the documents produced in the civil proceedings for any purpose other than the civil proceedings, thereby enabling the defendant to use the documents already produced for the purposes of the present criminal proceedings.

120 In the circumstances, there was no remaining issue in the application I am presently considering.

Orders

1. Defendant’s application of 11 September 2007

Set aside paras 3 and 5(c) of the plaintiff’s notice to produce to the defendant of 23 August 2007.

Food Act

2. Defendant’s application of 14 September 2007

Food Act

3. The plaintiff’s application

Dismiss the application to set aside parts of the defendant’s notice to produce.

Stand over the rest of the application.

**********

Citations

Authorised Officer Christine Tumney (NSW Food Authority) v Nutricia Australia Pty Limited [2007] NSWSC 1215

Most Recent Citation

Cases Citing This Decision

5

Commissioner of the Australian Federal Police v Mazzco Investments Pty Ltd & Ors. (No 4) [2024] NSWSC 837

The Commissioner of the Australian Federal Police v Mazzco Investments Pty Ltd [2023] NSWSC 425

NSW Food Authority v Nutricia Australia Pty Ltd [2008] NSWCCA 252

Cases Cited

1

Statutory Material Cited

6

Australian Securities and Investments Commission v Elm Financial Services Pty Ltd [2004] NSWSC 859

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CITATION:	Authorised Officer Christine Tumney (NSW Food Authority) v Nutricia Australia Pty Limited [2007] NSWSC 1215
HEARING DATE(S):	9 October 2007
JUDGMENT DATE :	2 November 2007
JUDGMENT OF:	James J
DECISION:	1. Defendant’s application of 11 September 2007; Set aside paras 3 and 5(c) of the plaintiff’s notice to produce to the defendant of 23 August 2007.; Dismiss the application to set aside the notices given pursuant to s 37 of the Food Act on 4 and 6 September 2007.; 2. Defendant’s application of 14 September 2007; Set aside the last two notices purportedly given pursuant to s 37 of the Food Act on 13 September 2007 (the Woolworths notices).; Dismiss the defendant’s application to set aside the first notice given pursuant to s 37 of the Food Act on 13 September 2007.; 3. The plaintiff’s application; Dismiss the application to set aside parts of the defendant’s notice to produce.; Stand over the rest of the application.
CATCHWORDS:	Food Act 2003 - authorised officers - functions of authorised officers - contempt of court - use of statutory power to obtain advantage in pending proceedings not obtainable under rules of court
LEGISLATION CITED:	Australian Securities and Investments Commission Act Clean Waters Act Criminal Procedure Act Evidence Act Food Act 2003 Trade Practices Act
CASES CITED:	Australian Securities and Investments Commission v Elm Financial Services Pty Ltd (2004) 186 FLR 295 Environment Protection Authority v Caltex Refining Co Pty Ltd (1992-1993) 178 CLR 477 Pioneer Concrete (Vic) Pty Ltd v Trade Practices Commission (1982-1983) 152 CLR 460 The Queen v De Simoni (1980-1981) 147 CLR 383
PARTIES:	Authorised Officer Christine Tumney (NSW Food Authority) v Nutricia Australia Pty Limited
FILE NUMBER(S):	SC 13664/07; 13666/07; 13669/07; 13678/07
COUNSEL:	M Joseph SC / MP Cahill / APL Naylor - Plaintiff RT Beech-Jones SC / A Mitchellmore - Defendant
SOLICITORS:	Moray & Agnew - Plaintiff Gilbert & Tobin - Defendant