Baker and Australian Securities and Investments Commission (Freedom of information)

[2019] AATA 4898

Baker and Australian Securities and Investments Commission (Freedom of information) [2019] AATA 4898 (21 November 2019)

Division:FREEDOM OF INFORMATION DIVISION

File Number:           2018/1920

Re:Michael Baker

APPLICANT

AndAustralian Securities and Investments Commission

RESPONDENT

DECISION

Tribunal:Mr A. Maryniak QC, Member 

Date:21 November 2019

Place:Melbourne

The Tribunal affirms the decision under review.

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Member

Catchwords

FREEDOM OF INFORMATION – request for access to documents – legal professional privilege – conditional exceptions claimed – public interest – decision affirmed

Legislation

Freedom of Information Act 1982 (Cth)

Cases

Campillo v Australian Customs Service (2005) 42 AAR 11

REASONS FOR DECISION

Mr A. Maryniak QC, Member

21 November 2019

INTRODUCTION

1. This matter concerns the Applicant’s request to the Respondent for disclosure of documents that are relevant to the Respondent’s decision not to take enforcement action against SMSF Invest Limited (SMFS).

2. SMFS was the entity responsible for a registered managed investment scheme –      SMSF Invest Property Fund – which has since been wound up.  The Respondent had received a number of complaints from investors in the scheme and commenced an investigation.

3. The Respondent sought legal advice from Counsel about the matter, however it ultimately decided not to take further enforcement action against SMSF and the Respondent advised the Applicant accordingly.

4. Following the Applicant’s access request and subsequent to the hearing of this matter, the parties provided the Tribunal with a Schedule of Documents in Dispute referring to          15 identified documents remaining, which were the subject of dispute between the parties.  This decision is directed to those 15 documents.

5. The Applicant gave evidence during the hearing.  In support of the claimed exemptions the Respondent relied upon the affidavit of Mr Kaan Nathaniel Finney, made                   16 November 2018, who also gave evidence and was cross examined.  As a consequence of the cross examination there was no change in the substance or effect of the evidence of Mr Finney.

   THE LAW

6. By s.11A(3) of the Freedom of Information Act 1982 (Cth) (‘the Act’), where a request is made to an agency for access to a document of the agency and access charges have been paid, the agency must give the person access to the document in accordance with the Act, subject to s.11A.

7. By s.11A(4) of the Act, the agency is not required to give the person access to the document at a particular time if, at that time, the document is an exempt document under the Act.

8. By s.31B of the Act, a document is exempt if:

   (a)it is an exempt document under Division 2 of Part IV (which includes ss.37 and 42); or

   (b)it is conditionally exempt under Division 3 (which includes s.47C) of Part IV and access to the document would, on balance, be contrary to the public interest for the purposes of s.11A(5).

9. By s.42(1) of the Act, a document is an exempt document if it is of such a nature that it would be privileged from production in legal proceedings on the ground of legal professional privilege.

10. By s.47C(1) of the Act, a document is conditionally exempt if its disclosure would reveal matter in the nature of or relating to, opinion, advice or recommendation obtained, prepared or recorded, or consultation or deliberation that has taken place, in the course of, or for the purposes of the deliberative processes involved in the functions of an agency, a Minister, or the Government of the Commonwealth.

11. The agency must give the person access to the document if it is conditionally exempt at a particular time unless (in the circumstances) access to the document at that time would, on balance, be contrary to the public interest: s.11A(5).

12. The Act sets out various public interest factors which favour access to a document or are irrelevant to that determination: s.11B.  Factors favouring access include whether access to the document would:

    (a)promote the objects of the Act, including all matters set out in ss.3 and 3A;

    (b)inform debate on a matter of public importance;

    (c)promote effective oversight of public expenditure; and

    (d)allow a person to access her or his own personal information.

    THE PARTIES’ SUBMISSIONS

13. The first document in issue is a confidential Barrister’s Memorandum of Advice dated     30 August 2015, being a confidential memorandum of advice purportedly prepared for the dominant purpose of giving legal advice and obtained in contemplation of commencing legal proceedings. The Respondent asserts legal professional privilege in respect of Document 1.

14. The Respondent submits that the privilege also attaches to summaries of the privileged documents themselves (namely Documents 3, 6, 10, 11, 25, 28, 34, 40 and 41).

15. The Applicant submits that none of these disputed documents were prepared for actual litigation as no such litigation occurred, they were not prepared for anticipated litigation as the only instigator of such litigation could be the Respondent and such was extremely unlikely, and that any privilege has been waived through the disclosures previously made.

16. The Applicant further submits that, where applicable, in respect of conditionally exempt documents, it is in the public interest for such information to be disclosed.

17. The Respondent relies upon the affidavit of Mr Finney to support its non-disclosure of the documents in dispute.  Mr Finney’s evidence is consistent with and supports the Respondent’s position regarding the documents in dispute with respect to their confidentiality and the legal professional privilege claimed.  In particular, paragraphs 36 to 57 and 59 to 77 of Mr Finney’s affidavit provide the evidentiary foundation for the Respondent’s claims of legal professional privilege and confidentiality.

18. On balance, after considering all of the evidence before the Tribunal, including the documents in dispute, and the submissions made by the parties, the Tribunal has reached the following conclusions in respect of the documents in dispute.

    Documents 1, 3, 6, 7, 11 and part documents 10, 25, 28, 34, 40 and 41

19. These documents comprise the Memorandum of Advice from a Barrister and internal memoranda, meeting minutes, file notes, annexures, drafts and emails pertaining to that confidential Memorandum of Advice.  On the evidence, the assertions of the Applicant are not made out.

20. The Tribunal finds that these documents remain exempt, by reason of s.42(1) of the Act, to the extent claimed by the Respondent. The evidence of Mr Finney supports the conclusion that these documents were and remain confidential and that the prospect of the Respondent commencing litigation remained alive and real up until the decision was taken not to pursue further action against SMSF. Legal professional privilege attaches to those documents. Insofar as the Applicant has asserted waiver by reason of the very limited information disclosed by the Respondent relating to the documents in dispute, the Tribunal finds that such disclosure, on balance, does not amount to any waiver of the legal professional privilege as held to exist.

21. In light of the findings in respect of s.42(1) of the Act, it is unnecessary for the Tribunal to assess the alternate exemptions claimed by the Respondent under the Act with respect to such documents.

    Documents 23, 26, 29 and 30

22. The Respondent seeks exemption from disclosure of these purported deliberative documents pursuant to s.47C(1) of the Act. Alternate exemption was sought pursuant to s.47E(d) asserting disclosure of the operations of the Respondent would occur.

23. To the extent that they are within the terms of the request, the documents comprising Document 23, being an email chain ending with an email from Irma Schoch to Tim Mullaly and David McGuinness, the content is, on balance, deliberative relating to the confidential processes of the Respondent and hence is exempt from disclosure pursuant to s.47C of the Act.

24. Document 26 is a chain of emails between officers of the Respondent in relation to its response to a communication from a member of the public making a confidential report of misconduct. It attaches Document 28. The third paragraph of Document 26 including all of the dot points are not within the terms of the FOI request. The remaining relevant content of Document 26 is clearly deliberative regarding the confidential processes of the Respondent and as such is exempt from disclosure by reason of s.47C of the Act. The evidence of Mr Finney establishes the confidentiality of this process of the Respondent.

25. Document 29 is an email chain between the Respondent’s officers regarding its dealings with a public complaint, which includes the email included in Document 26, part of which is not relevant as discussed above. The second paragraph of the final email in the chain, only relating to the response to a communication, is not within terms of the request. The remaining content of Document 29 relates to deliberative matters of the Respondent which are confidential to it and as such is exempt from disclosure pursuant to s.47C of the Act.

26. Document 30 is entitled “Progress meeting agenda – SMSF Invest Ltd”. It covers the meeting agenda, the (then) current status of the investigation and some next steps. The section of this document beginning with the last sentence of the first agenda item to the end of that document does not relate to the Respondent’s decision not to take enforcement action and is therefore not relevant to the Applicant’s request. The remainder of Document 30 covers confidential deliberative matters of the Respondent and is exempt from disclosure pursuant to s.47C of the Act.

27. By reason of s.31B of the Act it is necessary to examine public interest considerations with respect to the relevant content of Documents 23, 26, 29 and 30.

28. The Applicant submits the following regarding the purported public interest in the release of these documents:

    (a)the high level of public interest arising from the recent Hayne Royal Commission into the financial services sector and its regulators;

    (b)the assistance the release would give the Applicant ‘as a demonstrably motivated member of the public to contribute to Government processes, scrutinise Government activity and promote better informed decision making’; and

    (c)to assist generally the Applicant to contribute to Government processes.

29. The Respondent opposes such release and submits that the public interest considerations fall heavily in favour of non-disclosure.

30. Whilst the Tribunal accepts that the Applicant holds genuine grievances regarding the matters he complained to the Respondent about, it is not persuaded that the Applicant’s arguments satisfy the public interest requirement. The Tribunal finds that these documents comprise of deliberative matter within the general rule of s.47C of the Act. The nature of such information within these documents is of a most sensitive type.[1]

    [1] Campillo v Australian Customs Service (2005) 42 AAR 11 at [17].

31. The Respondent’s methods and procedures in investigating matters and arriving at decisions, whether or not to take enforcement action, will be compromised and lose their effectiveness if they are disclosed to the public.  The Respondent’s evidence supports this view.  On balance, the Tribunal accepts the Respondent’s evidence in this regard. The Tribunal finds that it is in the public interest that the confidential deliberative processes of the Respondent discussed above must be preserved. It is this public interest which is paramount here.

32. The Respondent has an important enforcement role within the Australian community and it is in the public interest that the integrity of the Respondent’s work be preserved by maintaining the confidentiality of its deliberative processes.  In light of these findings it is unnecessary for the Tribunal to consider alternate grounds put forward by the Respondent.

    DECISION

33. For the reasons set out above the Tribunal affirms the decision under review insofar as it exempts from disclosure the documents which remain in dispute in this matter.

I certify that the preceding 33 (thirty-three) paragraphs are a true copy of the reasons for the decision herein of Mr A Maryniak QC, Member

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Associate

Dated: 21 November 2019

Date of hearing:	24 June 2019
Counsel for the Respondent:	Mr Alexander Solomon-Bridge
Representative for the Applicant:	Mr Anthony Wamsteker