Bartlett v Sage (No 2)
[2011] FCA 274
•25 March 2011
FEDERAL COURT OF AUSTRALIA
Bartlett v Sage (No 2) [2011] FCA 274
Citation: Bartlett v Sage (No 2) [2011] FCA 274 Parties: PETER MERVYN BARTLETT v GE (TIM) SAGE, EXAMINER, AUSTRALIAN CRIME COMMISSION and COMMISSIONER OF TAXATION File number: WAD 62 of 2010 Judge: SIOPIS J Date of judgment: 25 March 2011 Catchwords: EVIDENCE – whether a party claiming public interest immunity in relation to the exercise of coercive statutory powers is required to adduce evidence which demonstrates a prima facie case that the party acted lawfully in the exercise of those powers as a condition of claiming the immunity – whether redaction of documents allowed on the basis of public interest immunity – whether redaction allowed on the basis of relevance. Legislation: Australian Crime Commission Act 2002 (Cth) ss 7C, 28, 59(7) Cases cited: Alister v The Queen (1984) 154 CLR 404
National Companies and Securities Commission v News Corporation Ltd (1984) 156 CLR 296
Attorney-General (NT) v Kearney (1985) 158 CLR 500
State of Victoria v Brazel (2008) 19 VR 553
Sankey v Whitlam (1978) 142 CLR 1Date of hearing: 30 September 2010 Place: Perth Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 81 Counsel for the Applicant: Mr C Shanahan SC and Mr BD Luscombe Solicitor for the Applicant: Cochrane Lishman Carson Luscombe Counsel for the First and Second Respondents: Mr PR Macliver
Solicitor for the First and Second Respondents: Australian Government Solicitor
Counsel for the Third Respondent: Mr TP Burrows
Solicitor for the Third Respondent: Australian Government Solicitor
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
WAD 62 of 2010
BETWEEN: PETER MERVYN BARTLETT
ApplicantAND: GE (TIM) SAGE, EXAMINER
First RespondentAUSTRALIAN CRIME COMMISSION
Second RespondentCOMMISSIONER OF TAXATION
Third Respondent
JUDGE:
SIOPIS J
DATE OF ORDER:
25 MARCH 2011
WHERE MADE:
PERTH
THE COURT ORDERS THAT:
1.The first and second respondents are to produce to the applicant the document dated 2 November 2009 entitled “Statement of Facts and Circumstances in support of the issue of a Section 28 Summons” without the redactions effected in respect of the following marked paragraphs of that document: paragraphs B, C, E, F, G, H, I, J, K, L, M, N, O, P, Q, R, S, T, U, X, Y, Z (to the extent referred to in [61] of the reasons for judgment), AC, AD, AE (to the extent referred to in [64] of the reasons for judgment), AF (to the extent referred to in [67] of the reasons for judgment), AJ and AK.
2.The first and second respondents are to produce to the applicant the document dated 17 November 2009 entitled “Reasons for the Issue of a Summons” without the redactions effected in respect of paragraph A and paragraph C (to the extent referred to in [71] and [73] of the reasons for judgment).
3.The first and second respondents are to produce to the applicant the following documents without redactions:
(a)the document headed “Authority to Attend” dated 10 December 2009;
(b)each of the documents headed “Australian Tax Office services in relation to Australian Crime Commission operations and investigations” dated 26 May 2008 and 28 October 2009 respectively, and including Schedule 1 and Schedule 2 attached to each document).
Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
WAD 62 of 2010
BETWEEN: PETER MERVYN BARTLETT
ApplicantAND: GE (TIM) SAGE, EXAMINER
First RespondentAUSTRALIAN CRIME COMMISSION
Second RespondentCOMMISSIONER OF TAXATION
Third Respondent
JUDGE:
SIOPIS J
DATE:
25 MARCH 2011
PLACE:
PERTH
REASONS FOR JUDGMENT
On 13 September 2006, the Board of the first respondent, acting pursuant to s 7C of the Australian Crime Commission Act 2002 (Cth) (the Crime Commission Act), made a determination known as the Australian Crime Commission Special Investigation Authorisation and Determination (Wickenby Matters) 2006. The Wickenby matters determination authorised the Australian Crime Commission to conduct a special investigation in respect of certain kinds of “federally relevant criminal activity”. This criminal activity included fraudulent conduct in relation to the evasion of, or making false claims in relation to, taxation obligations. The Wickenby matters determination identified a number of circumstances underlying the determination. These circumstances included the circumstance that persons were using overseas transactions and funds transfers to avoid Australian taxation obligations and to launder the proceeds of crime.
The Wickenby matters determination has been extended on a number of occasions and the Commission continues to conduct investigations pursuant to that determination. As part of those investigations, the Commission has conducted, and continues to conduct, a special investigation codenamed “Operation Haycastle” in relation to taxation schemes with which Mr Gregory John Dunn, a former consultant to a Perth law firm, was involved.
Before August 2007, the applicant, Mr Bartlett, conducted business, mainly in relation to the mining industry, through the Barminco Unit Trust, a trust in respect of which the company, Barminco Pty Ltd, was the corporate trustee. Mr Sayers, a friend of Mr Bartlett, also had an interest in the business. From 2000 to 2005, Mr Bartlett used the services of Mr Dunn in relation to the business affairs of the trust. In 2001, Mr Bartlett established what he referred to in his affidavit as an “overseas structure”, in relation to the business. Matters relating to the taxation affairs of Mr Bartlett and the Barminco business came to the attention of the Commission. Following an investigation of those matters by the Commission as part of Operation Haycastle, a settlement was ultimately reached in 2008, between, amongst others, Mr Bartlett and the Australian Taxation Office.
In the meanwhile, in August 2007, Mr Bartlett sold his stake in the Barminco business to a private consortium. Shortly after the sale, Mr Bartlett distributed monies totalling about $4 million, from the sale proceeds to a number of his friends, who included persons who had been involved with Mr Bartlett in Barminco. Mr Bartlett described these payments as “gifts”. It is contended that no tax was paid in respect of the $4 million distributed to the individuals. Further, following the sale of his stake in Barminco, Mr Bartlett entered into negotiations with persons associated with the overseas structure to have funds held in the overseas structure, returned to Australia. Mr Bartlett said that the negotiations took some time and the monies were returned to Australia in July 2009.
On 2 November 2009, an officer of the Commission prepared a document headed “Statement of Facts and Circumstances in support of the issue of a Section 28 Summons”. The document was addressed to the first respondent, Mr Sage, an officer of the Commission appointed as an examiner under the Crime Commission Act. The document referred to the payment of the monies by Mr Bartlett from the proceeds of the sale of the Barminco business, and to the fact that Mr Bartlett had advised each recipient of the payments that no tax was payable on the payment. The document went on to request that a summons be issued for the examination of Mr Bartlett under s 28 of the Crime Commission Act.
The front page of the “Statement of Facts and Circumstances” document contains, among other information, the following statements:
Special Investigation Name: Haycastle
Relevant determination/s: Wickenby
On 16 November 2009, a legal practitioner with the Commission, prepared a document entitled “Legal Submissions in Support”. This document was submitted to Mr Sage, in support of the application for the issue of the s 28 summons to examine Mr Bartlett. The legal submissions expressed the view that the purpose of the proposed examination of Mr Bartlett was consistent with, and fell within, the scope of the Wickenby matters determination. The legal submissions went on to state that there was a basis for the examiner to conclude that it was reasonable in all the circumstances to issue a summons to Mr Bartlett on the basis that Mr Bartlett would not provide the information voluntarily due to the fact that he was suspected of involvement in the activity that was the subject of the investigation. It was also contended that the examination could be a means of attempting to confirm the matters referred to in the Statement of Facts and Circumstances.
On 17 November 2009, Mr Sage, the first respondent, issued a summons under s 28 of the Crime Commission Act requiring Mr Bartlett to attend an examination on 10 December 2009. This summons stated that Mr Bartlett was required to attend the examination to give evidence of federally relevant criminal activity involving:
Conspiracy to defraud within the meaning of section 135.4 of the Criminal Code through the evasion of, or making false claims in relation to, tax;
Defrauding the Commonwealth within the meaning of section 29D of the Crimes Act 1914 through the evasion of, or making false claims in relation to, tax;
Obtaining a financial advantage by deception, within the meaning of section 134.2 of the Criminal Code through the evasion of, or making false claims in relation to, tax;
Money laundering within the meaning of the Proceeds of crime Act 1987;
Dealing with money or other property contrary to section 400.4 of the Criminal Code.
On the same day, Mr Sage also published his reasons for the issue of the summons. The heading of the document refers to the Operation Haycastle special investigation. The reasons stated that the purpose of the examination was to examine Mr Bartlett about the following matters:
•What understanding existed between BARTLETT and SAYERS as to payments, who should receive them and how much they should receive;
•On what basis did he advise the recipients that the payments were not subject to tax;
•Whether the payments were made in connection with each recipient’s employment with Barminco, or for some other purpose;
•Why were the payments made in the particular manner in which they were paid;
•What was the purpose of the letters and they way in which they were crafted;
•to ascertain BARTLETT’S intentions in making the payments, whether or not the payments were actually made in connection with the recipients’ employment.
On 10 December 2009, Mr Sage signed a document authorising a number of members of the Commission’s staff and other persons to attend the examination of Mr Bartlett. Among the persons authorised to attend were two persons who were Australian Taxation Office officers and two financial investigators who were associated with both the Commission and the Australian Taxation Office.
On 10 December 2009, Mr Bartlett attended at the offices of the Commission in Perth and was examined by Mr Sage. It is common cause that present at the examination were officers from the Australian Taxation Office.
During the course of Mr Bartlett’s examination, Mr Sage made an interim non‑publication direction with regard to the answers given by Mr Bartlett during the course of the examination, but specifically exempted the Australian Taxation Office from the direction for the purpose of allowing its officers access to the information provided by Mr Bartlett during the examination.
A transcript of the examination of Mr Bartlett was made. It is also common cause that a copy of the transcript of examination was forwarded to an Australian Taxation Office officer by an officer of the Commission under cover of a letter dated 21 January 2010. The letter stated that the transcript was communicated to the Australian Taxation Office officer pursuant to s 59(7) of the Crime Commission Act.
In late January and early February 2010, an officer of the Australian Taxation Office sent a letter to each of the persons to whom Mr Bartlett had made a payment in or about August 2007, headed “Notice of Intention to Review”. Each letter noted that the payment from Mr Bartlett had not been included in the income tax return submitted by that person for the year ended 30 June 2008. The letter went on to invite the person to attend an interview at the Australian Taxation Office to discuss amending their income tax return.
THE PROCEEDING IN THIS COURT
On 23 March 2010, Mr Bartlett commenced a proceeding in this Court seeking orders for the review of a number of decisions made by Mr Sage in relation to the issue of the summons and the examination. Mr Bartlett relied upon the Administrative Decisions (Judicial Review) Act 1977 (Cth) and the Judiciary Act 1903 (Cth) to review the decisions. On 29 June 2010, Mr Bartlett filed a substituted application for review.
Among the decisions of Mr Sage impugned by Mr Bartlett, are the decision to issue the examination summons to Mr Bartlett for the purpose of examining Mr Bartlett about the payments; the decision to compel Mr Bartlett to answer questions regarding the payments during his examination on 10 December 2009; and the decision of Mr Sage to make an interim non-publication direction with regard to the answers given by Mr Bartlett during the course of the examination as to the payments which exempted the Australian Taxation Office.
Mr Bartlett also claimed relief against the third respondent, the Commissioner of Taxation, in respect of his decision or that of his officers, servants or agents, to use the information obtained by the examination of Mr Bartlett for the purposes of the Australian Taxation Office, including, as the basis for issuing Notices of Intention to Review to the recipients of the payments made by Mr Bartlett.
The essence of Mr Bartlett’s contention is that all three respondents have acted unlawfully because the investigation of the payments made by Mr Bartlett in or about August 2007, does not fall within the scope of the Wickenby matters determination, and the investigation was initiated and conducted for the improper purpose of assisting the Australian Taxation Office.
THE NOTICE TO PRODUCE
On 21 May 2010, Mr Bartlett acting pursuant to O 33 r 12 of the Federal Court Rules, issued to Mr Sage and the Commission, a notice to produce a number of documents relating to Mr Sage’s decision to issue the summons to examine Mr Bartlett and the conduct of the examination.
By a letter dated 17 June 2010, the Australian Government Solicitor responded to the notice to produce by producing copies of a number of documents to the Court and Mr Bartlett’s solicitors. Those documents, however, contained a number of redactions. The letter from the Australian Government Solicitor asserted public interest immunity from production in respect of the redacted parts of the documents. The letter relevantly stated:
3.The NTP Documents are comprised of:
3.1Summons S0515/09 to Appear before the ACC, containing Statements of Facts and Circumstances in support of the issue of a Section 28 Summons dated 2 November 2009 and Legal Submissions in Support dated 16 November 2009 (with redactions);
3.2Reasons for the Issue of a Summons S05215-09 pursuant to subsection 28(1) of the Australian Crime Commission Act 2002 dated 17 November 2009 (with redactions);
3.3Authority to Attend dated 10 December 2009 (with redactions);
3.4Australian Taxation Office services in relation to Australian Crime Commission operations and Investigations dated 26 May 2008 (with redactions); and
3.5Australian Taxation Office services in relation to Australian Crime Commission operations and Investigations dated 28 October 2009 (with redactions).
4.The ACC asserts public interest immunity (PII) in respect of the redacted portions of the NTP Documents, on the basis that disclosure to the Applicant of the confidential information contained within those documents will seriously damage public interest by prejudicing ongoing investigations of the ACC. The ACC asserts that a public interest exists in protecting information, which is the subject of a continuing investigation by the ACC and the ATO which, if disclosed may impede further investigations.
THE NOTICE OF MOTION CHALLENGING THE RESPONDENTS’ REDACTIONS
On 7 July 2010, Mr Bartlett filed a notice of motion requiring Mr Sage and the Commission to produce the nominated documents without any redactions. In support of the notice of motion, Mr Bartlett relied upon the affidavit of Mr Nathan Landis of 5 July 2010, and the affidavit of Mr Bartlett sworn on 3 June 2010.
After Mr Bartlett had filed his notice of motion, Mr Sage and the Commission produced to Mr Bartlett copies of the relevant documents which revealed some parts of the documents which had previously been redacted. However, Mr Sage and the Commission continued to claim that they were entitled to produce the documents with the remaining redactions in place, on the grounds of public interest immunity and, in certain cases, relevance.
In support of their claim that they were entitled to maintain the redactions, Mr Sage and the Commission relied upon an affidavit of Mr Robert Philp sworn 15 July 2010.
Mr Sage and the Commission also relied upon an affidavit of Mr Richard Duncan Grant sworn 11 August 2010. An edited copy of that affidavit was served on Mr Bartlett’s solicitors. The editing comprised the redaction of a substantial number of paragraphs of the affidavit in which Mr Grant deposed to the grounds on which the redactions were justifiable. Mr Sage and the Commission also sought to justify the redaction of these statements from Mr Grant’s affidavit on the grounds of public interest immunity.
At the hearing of the motion, counsel for Mr Sage and the Commission handed to the Court a copy of an unredacted version of Mr Grant’s affidavit. However, the affidavit was marked in such a way as to indicate those parts of the affidavit which had been redacted from the copy of the affidavit which had been served on Mr Bartlett’s solicitors. I will deal later in these reasons with the question of which parts of that affidavit are to continue to be the subject of redactions.
Further, at the hearing, Mr Sage and the Commission handed to the Court a copy of the documents that had been produced to Mr Bartlett’s solicitor pursuant to the notice to produce, in an unredacted form. The parties were content for the Court to inspect the documents in an unredacted form for the purpose of determining Mr Bartlett’s application.
In his affidavit, Mr Philp deposed that he was a certified practising accountant, and was a member of staff of the Commission and held the position of a Principal Specialist Financial Investigator at the Commission. Mr Philp said that he was responsible for the oversight of various activities in relation to the Wickenby matters determination.
Mr Philp went on to depose that as part of the special investigation conducted pursuant to the Wickenby matters determination, the Commission was conducting a special investigation codenamed “Operation Haycastle” in relation to alleged tax avoidance schemes devised by Mr Gregory John Dunn. Mr Philp said that he was in charge of coordinating and progressing Operation Haycastle.
Mr Philp said that Mr Dunn came to the attention of the Commission after a link was discovered by the Commission between Mr Dunn and Strachans, an accounting services firm located in Geneva, Switzerland, which was suspected by the Commission of being involved in tax evasion and money laundering by Australian residents. Mr Philp went on to depose that the Commission’s investigations revealed that Mr Dunn acted as an intermediary between a group of Australian resident clients and Strachans.
Mr Philp deposed that the Commission’s investigations have revealed that between 2000 and 2005, Mr Dunn provided taxation advice to Mr Bartlett and in 2001, had introduced Mr Bartlett to Strachans and that Mr Bartlett had ultimately utilised the services of Strachans with Mr Dunn acting as an intermediary. Mr Philp then deposed to having learned of the distribution of the $4 million by Mr Bartlett and that it was suspected that Mr Bartlett and others may have been a party to tax avoidance schemes and that some or all of the sale proceeds may represent tax unlawfully evaded by Mr Bartlett and others. Mr Philp deposed that in order to obtain further information and to progress the investigation of the payments and Operation Haycastle generally, Mr Philp considered that it was necessary to apply for a summons to examine Mr Bartlett pursuant to s 28 of the Crime Commission Act.
In his affidavit, Mr Grant deposed that he was a member of staff of the Australian Crime Commission and served in the role as National Manager of target development and intervention. Prior to joining the Commission, Mr Grant had a distinguished career in the Victorian Police Force.
Annexed to Mr Grant’s affidavit were copies of the documents in respect of which redactions had been made. There were five documents. The redacted portions of each of the documents were identified by reference to letters of the alphabet. In respect of each redaction identified in this way, Mr Grant stated the basis on which that redaction had been made.
Mr Sage and the Commission sought to justify some of the redactions on the grounds of public interest immunity and other redactions on the grounds of relevance.
PUBLIC INTEREST IMMUNITY
I deal first with the principles in relation to public interest immunity. In the case of Alister v The Queen (1984) 154 CLR 404 at 412 (Alister), Gibbs CJ summarised the principles to be applied in the following terms:
Sankey v Whitlam establishes that when one party to litigation seeks the production of documents, and objection is taken that it would be against the public interest to produce them, the court is required to consider two conflicting aspects of the public interest, namely whether harm would be done by the production of the documents, and whether the administration of justice would be frustrated or impaired if the documents were withheld, and to decide which of those aspects predominates. The final step in this process – the balancing exercise – can only be taken when it appears that both aspects of the public interest do require consideration – ie, when it appears, on the one hand, that damage would be done to the public interest by producing the documents sought or documents of that class, and, on the other hand, that there are or are likely to be documents which contain material evidence. The court can then consider the nature of the injury which the nation or the public service would be likely to suffer, and the evidentiary value and importance of the documents in the particular litigation.
The basis on which Mr Sage and the Commission relied to establish the first limb of the test was the public interest in protecting the integrity of a continuing investigation being undertaken pursuant to the Wickenby matters determination. Mr Sage and the Commission said that the public interest in protecting the processes of a continuing investigation was articulated in the following observations of Mason, Wilson and Dawson JJ in National Companies and Securities Commission v News Corporation Ltd (1984) 156 CLR 296 at 323‑324:
It is of the very nature of an investigation that the investigator proceeds to gather relevant information from as wide a range of sources as possible without the suspect looking over his shoulder all the time to see how the inquiry is going. For an investigator to disclose his hand prematurely will not only alert the suspect to the progress of the investigation but may well close off other sources of inquiry.
Mr Bartlett did not dispute that the basis on which Mr Sage and the Commission claimed public interest immunity, if made out, was a legitimate basis upon which to found such a claim. However, Mr Bartlett contended, as a preliminary contention, that a party who claimed public interest immunity in respect of information gathered by the use of, or in relation to, the exercise of coercive investigative statutory powers, was required to adduce evidence which demonstrated a prima facie case that the party claiming the immunity had acted lawfully in the exercise of those powers.
Mr Bartlett contended that there was a distinction between the investigation undertaken by the Commission into the payments made by Mr Bartlett following the sale of the Barminco business in or about August 2007, on the one hand, and the scope of the Wickenby matters determination and Operation Haycastle, on the other hand. The payments, said Mr Bartlett, did not have any overseas element associated with them and, it followed, that the investigation into those payments did not fall within the scope of the Wickenby matters determination and Operation Haycastle.
Mr Bartlett went on to contend that the evidence from Mr Grant and Mr Philp, did not disclose a lawful basis for the exercise of the statutory powers by Mr Sage and the Commission in relation to the investigation into the payments.
In my view, that submission is to be rejected for the following reasons.
First, Mr Bartlett relied by analogy, on the principle that legal professional privilege could not be claimed to protect communications which are made for the purposes of assisting in the commission of fraud. Mr Bartlett referred specifically to the case of Attorney-General (NT) v Kearney (1985) 158 CLR 500 (Kearney), where the High Court held that the so-called fraud exception, extended to cases where the impugned communication was made to further a deliberate abuse of statutory power in the making of delegated legislation.
However, in my view, even if the principle accepted in Kearney, applied in relation to public interest immunity claims (on which I express no view), the High Court decision would not support the contention advanced by Mr Bartlett. This is because the exception only applies in circumstances where there is a “deliberate abuse of power”. There is no such allegation made in this case.
Secondly, Kearney does not support Mr Bartlett’s contention that there is an onus on the statutory authority claiming public interest immunity, to establish a prima facie case that it was acting lawfully in the exercise of its power. Rather, in Kearney, the High Court held that the onus is on the party alleging the deliberate abuse of power, to lead prima facie evidence that the claim has a foundation in fact. This is apparent from the following observations of Gibbs CJ in Kearney at 516:
The privilege is of course not displaced by making a mere charge of crime or fraud or, as in the present case, a charge that powers have been exercised for an ulterior purpose. This was made clear in Bullivant v Attorney-General (Vict) and in O’Rourke v Darbishire. As Viscount Finlay said in the latter case, “there must be something to give colour to the charge”. His Lordship continued:
The statement must be made in clear and definite terms, and there must further be some prima facie evidence that it has some foundation in fact…The Court will exercise its discretion, not merely as to the terms in which the allegation is made, but also as to the surrounding circumstances, for the purpose of seeing whether the charge is made honestly and with sufficient probability of its truth to make it right to disallow the privilege of professional communications. (Footnotes omitted.)
Thirdly, Mr Bartlett relied on the following observations made in State of Victoria v Brazel (2008) 19 VR 553 at [68]:
Since immunity will not be lightly conferred, it should be lightly claimed…it is never enough to merely assert – as if it were self-evident – that disclosure of the information in question will harm some particular aspect of the public interest. The claim for immunity must be articulated with rigour and precision, and supported by evidence demonstrating the currency and sensitivity of the information, so as to constitute a compelling case for secrecy.
These observations are addressed to the evidence required to be led by the party claiming public interest immunity, of the harm to the public interest that will eventuate from the disclosure of the information as part of the prelude to the balancing process, referred to by Gibbs CJ in Alister. The observations do not establish a requirement on the party claiming the immunity to demonstrate a prima facie case that it has acted within power in respect of its impugned conduct, as a condition of claiming the immunity. The question as to whether a claimant for the immunity has discharged the burden of demonstrating the threatened harm to the public interest if the disputed information was disclosed to the applicant, is a different question.
Mr Bartlett also contended that, in any event, Mr Sage and the Commission had not established a sufficient evidentiary foundation to discharge the burden of demonstrating a sufficient harm to the public interest. Mr Bartlett contended that more was required than an assertion of harm to the public interest. I will deal with this submission as part of the consideration of the redactions claimed on the basis of public interest immunity. I will also deal with the question of redacting on the grounds of relevance as part of that process.
The parties addressed their submissions in respect of each of the redactions, by reference to the identification marks used by Mr Grant in his affidavit.
I will deal with each of the redactions using the same format that was adopted by the parties.
THE STATEMENT OF FACTS AND CIRCUMSTANCES
I deal first with redactions made to the document entitled “Statement of Facts and Circumstances in support of the issue of a Section 28 Summons”.
Paragraph A
Mr Bartlett did not press his objection.
Paragraph B
Mr Sage and the Commission contended that revealing the substance of this paragraph would prejudice the effectiveness of the investigation because it identifies a person of interest.
I have inspected the paragraph and, in my view, the paragraph does reveal some information about the nature of the investigation. However, that information, namely, that Mr Bartlett is a person of interest to the investigators is already disclosed in the affidavit of Mr Philp and, also, in the document containing the legal submissions in support of the issue of the summons. It follows that the respondents have failed to establish the first limb of the test. Accordingly, no balancing exercise is called for. The redaction should be removed.
Paragraphs C, E, F, G, H, I, J, K, L, M, N, O, P, Q, R, S, T, U, X and Y
The respondents have claimed that the redaction of these paragraphs is justified on the basis of relevance.
Mr Grant deposed in support of this contention that these paragraphs are relevant to Operation Haycastle generally but not relevant to the payment investigation specifically. It is said that the purpose of these paragraphs was to provide the examiner with the general background of Operation Haycastle to give context to the payment investigation. It is said that these paragraphs are otherwise not relevant to the subject proceedings.
In my view, the respondents’ contention is not to be accepted. The information was thought sufficiently relevant by the author of the document to include in the Statement of Facts and Circumstances given to Mr Sage. It is conceivable that the presence of that information may have been taken into account by the decision-maker. The question of relevance cannot be determined at this stage of the proceeding. That question is one for the Court to determine in due course. The redactions must all be removed.
Paragraph D
Mr Bartlett did not press his objection.
Paragraph V
Mr Sage and the Commission contended that the redacted portion discloses the names of witnesses who have been examined and this information would also alert Mr Bartlett to the information which the Commission has in relation to the investigation. In my view, the information, if disclosed, will be likely to prejudice the effectiveness of the ongoing investigation and so harm the public interest because it would disclose the identity of persons who have been examined by the Commission in respect of the investigation and would disclose the sources of the information available to the investigation. Therefore, the respondents have satisfied the first limb of the test in Sankey v Whitlam (1978) 142 CLR 1 (Sankey).
In my view, this claim for public interest immunity is not based simply on assertion. The very nature of the information, when viewed, is such as to give rise to the inference that its disclosure will be likely to prejudice the effectiveness of the ongoing investigation.
The information, however, is not of such a nature that it would be of assistance to Mr Bartlett in the establishment of the claim which Mr Bartlett makes in relation to the lawfulness of the impugned decisions. Accordingly, the balancing exercise is not called for. The redaction should remain in place.
Paragraph W
This information, if revealed, would disclose the means used by the Commission of obtaining information relevant to the investigation. The same reasoning as set out above in relation to paragraph V, applies. The redaction should, therefore, remain in place.
Paragraph Z
In my view, save for some words in the second sentence of this paragraph, the contents of paragraph Z if revealed, would disclose no more than what is common cause between Mr Bartlett and the first and second respondents. This information is also effectively disclosed at paragraph 27 of the affidavit of Mr Philp. Accordingly, Mr Sage and the Commission have failed to satisfy the first limb of the test in Sankey.
The redaction should be removed, save that in respect of the second last sentence, the redaction should only be partially removed so that the unredacted sentence reads:
…the payments have been deliberately structured so that no tax is paid on the amounts.
The partial redaction should be made because the information the subject of the partial redaction, reveals the means used by the Commission to obtain information, and, therefore, the reasons given in relation to paragraph V, apply.
Paragraphs AA and AB
The information in paragraph AA and paragraph AB discloses names of persons who have been examined as part of the investigation, the information they provided to the Commission and the means whereby the investigation has been conducted. The same reasoning as applied to the redactions at paragraph V above, apply in relation to these redactions. Therefore, the redactions should remain.
Paragraphs AC, AD and AE
The information referred to by these three paragraphs describes the workings of the investigation and the Commission’s dealings with the Australian Taxation Office. The evidence relied on by Mr Sage and the Commission, and the content of the information itself, does not, in my view, demonstrate that the disclosure of the information would be likely to prejudice the investigation and so harm the public interest. However, even if such harm would occur, that harm would be outweighed in the balancing exercise by the detriment to the administration of justice which would be suffered by reason of Mr Bartlett not being able to use this information for the purposes of assisting in proving his claim that Mr Sage and the Commission acted for an improper purpose. Accordingly, the redactions in paragraph AC and paragraph AD should be removed. In relation to paragraph AE, namely, the final sentence of the paragraph, the redaction should only partially be removed so that the final sentence will read:
Investigators believe that these information gaps can be addressed by reference to…the examination…
The reasoning in relation to paragraph V applies to explain the retention of the partial redaction.
Paragraphs AF, AG, AH and AI
These paragraphs refer to the methods of the examination and the names of potential examinees. The name of Mr Bartlett is included in the redaction.
For the reasons given in relation to paragraph V above, the redactions should remain, save in relation to the word “Bartlett” at the top of the names in paragraph AF. This word should be disclosed for the reasons given in [51] above.
Paragraphs AJ and AK
The reasoning previously referred to in respect of paragraphs AC, AD and AE applies in relation to the information contained in paragraph AJ and paragraph AK. The redaction should, accordingly, be removed.
Paragraph AL
This redaction seeks to conceal the identity of the author of the document on the grounds of relevance. Mr Bartlett did not press his objection.
REASONS FOR THE ISSUE OF A S 28 SUMMONS
The next document in respect of which redactions were made, was the document setting out Mr Sage’s reasons for issuing the summons for the examination of Mr Bartlett. In relation to this document, the respondents have identified four redactions by reference to the letters A, B, C and D.
Paragraph A
The redacted information is the same as that referred to in paragraph Z of the Statement of Facts and Circumstances. Accordingly, the same order is made mutatis mutandis for the same reasons.
Paragraph B
The information referred to in paragraph B, repeats information referred to in paragraph AB of the Statements of Facts and Circumstances. Accordingly, for the same reasons, the redactions should remain.
Paragraph C
The information repeats almost exactly the same information as appears in paragraphs AC, AD and AE of the Statement of Facts and Circumstances. The same reasoning, therefore, applies in relation to paragraph C as applied in relation to paragraphs AC, AD and AE above. The redaction should, therefore, be removed save that the redaction in relation to the last sentence, should be removed only to the extent that the unredacted part of the last sentence reads:
Investigators believe that these information gaps can be addressed by…the examination of…Bartlett.
Paragraph D
The information largely repeats the information at paragraph AH and paragraph AI of the Statement of Facts and Circumstances. For the reasons given in relation to those paragraphs, the redactions should remain.
AUTHORITY TO ATTEND
The next document in respect of which redactions were made, is a document signed by Mr Sage on 10 December 2009, authorising a number of persons to attend the examination of Mr Bartlett on that day.
It is part of Mr Bartlett’s claim that Mr Sage authorised persons, who were not members of the staff of the Commission to be present at the examination, without informing Mr Bartlett of their presence and without giving him an opportunity to comment on their presence.
The authority to attend contains the names of eight persons who were authorised by Mr Sage to attend the examination. Those include the names of four persons who were in some way associated with the Australian Taxation Office. In my view, the names of the persons are relevant. This is because a question may arise as to whether these persons were authorised by the Australian Taxation Office to work with the Commission. It may, therefore, be relevant to compare the names on this document with the names on other documents. The redactions should be removed.
AUSTRALIAN TAXATION OFFICE’S SERVICES DOCUMENTS
The next two documents are documents dated 26 May 2008 and 28 October 2009 respectively. Each document evidences the authorisation by an officer of the third respondent, of certain members of staff of the Australian Taxation Office to provide services to the Commission in relation to its operations and investigations. Each of the documents contains a schedule listing the names of the members of staff who are authorised to provide services to the Commission.
The names of the members of staff on each schedule have been redacted, on the basis of relevance.
In my view, for the reasons already given, it cannot be determined at this stage that the names are not relevant and the redactions should be removed.
CONFIDENTIAL AFFIDAVIT OF MR GRANT
I will hear the parties on the question of the removal of the redactions in Mr Grant’s affidavit. However, my tentative view is that, for the reasons stated above, the redactions made at paragraphs 11, 12, 28, 29, 30, 31, 33 and 35, should remain, and the other redactions should be removed.
I certify that the preceding eighty‑one (81) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Siopis. Associate:
Dated: 25 March 2011
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