Cargill Australia Ltd v Viterra Malt Pty Ltd (No 23)
[2019] VSC 417
•27 JUNE 2019
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
| AT MELBOURNE COMMERCIAL COURT |
S ECI 2014 000146
| CARGILL AUSTRALIA LIMITED (ACN 004 684 173) | Plaintiff |
| v | |
| VITERRA MALT PTY LTD (ACN 096 519 658) AND OTHERS | Defendants |
| and | |
| CARGILL, INCORPORATED AND OTHERS | Third parties |
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JUDGE: | ELLIOTT J |
WHERE HELD: | MELBOURNE |
DATES OF HEARING: | 21 MAY 2019 |
FURTHER WRITTEN SUBMISSIONS | 5 JUNE 2019 |
DATE OF RULING: | 27 JUNE 2019 |
CASE MAY BE CITED AS: | CARGILL AUSTRALIA LTD v VITERRA MALT PTY LTD (No 23) |
MEDIUM NEUTRAL CITATION: | [2019] VSC 417 |
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EVIDENCE – Confidentiality – Existing confidentiality regime – Application for confidentiality order – Figures relating to recent sale of business the subject of proceeding – Redaction of figures from transcript – Previous interim orders – Principle of open justice – Whether circumstances exist to justify confidentiality – Whether necessary to administration of justice to make confidentiality order – Whether disclosure would harm a party or non-party – Whether Open Courts Act 2013 (Vic) applies – Order made, but limited in duration and subject to interim review – Open Courts Act 2013 (Vic), ss 3, 4, 5, 7, 28.
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APPEARANCES: | Counsel | Solicitors |
| For the plaintiff and the 1st and 2nd third parties | Mr P Solomon QC Dr C Parkinson | Gilbert + Tobin |
HIS HONOUR:
A. Introduction
In David Syme & Co Ltdv General Motors-Holden’s Ltd,[1] Street CJ observed that in litigation which involves confidential information, the “taking of evidence in public can present a special problem” since there is the “ever present risk that the exuberance of counsel or the predicament of a witness may let the cat out of the bag”.[2]
[1][1984] 2 NSWLR 294.
[2]At 300F.
In the trial of this proceeding, on a number of occasions, information accepted to be confidential has been inadvertently disclosed in open court.
The relevant information relates to the publicly-announced sale of the global malt business (“Cargill’s Malt Business”) of the first third party, Cargill, Incorporated (“Cargill, Inc”). It includes:[3]
[3]In evidence put forward for the purposes of this application, the Cargill Parties have identified other categories of information said to be confidential, including other financial data of Cargill’s Malt Business, such as malt production and sales data. However, this further information falls outside the scope of the present application, which is for a confidentiality order maintaining transcript redactions of inadvertent references to confidential information in open court. As there have been no inadvertent references to these further categories of information, that information need not be discussed further.
(1) The total price paid for Cargill’s Malt Business (“the Sale Price”).
(2)The amounts of the Sale Price allocated to the various regional components of Cargill’s Malt Business.
(3)The earnings before interest, tax, depreciation and amortisation multiple by which the Sale Price was calculated (“EBITDA Multiple”).
(Together, “the Sale Figures”.)
Following each inadvertent disclosure by counsel or a witness of a component of the Sale Figures, or evidence derived from the Sales Figures, Cargill, Inc, the plaintiff, Cargill Australia Ltd (“Cargill Australia”), and the second third party, Joe White Maltings Pty Ltd (“Joe White”)[4] (together, “the Cargill Parties”) have sought orders that parts of the transcript recording inadvertent references to the Sale Figures be redacted.
[4]Now known as Cargill Malt Asia Pacific Pty Ltd.
On each occasion, the orders sought have not been opposed, and no substantive submissions were sought, or provided.[5] Orders were made substantially in the form sought.[6] However, the parties were informed that none of those orders reflected a permanent position. Rather, each order was to be understood as an interim position, to allow a long-running trial[7] to continue uninterrupted in advance of a formal application by the Cargill Parties for a confidentiality order in respect of the various references to the Sale Figures in the transcript of the trial.[8]
[5]However on 1 occasion, it was ordered that a supporting affidavit deposing to the confidential nature of some of the Sales Figures be provided to the court: see par 23 below.
[6]See pars 20 to 26 below.
[7]The trial of the proceeding commenced on 18 June 2018.
[8]A similar approach has been appropriately taken in other cases: see, for example, Hogan v Australian Crime Commission (2009) 177 FCR 205, 211-212 [17] (Jessup J, with whom Moore J relevantly agreed), approving the approach of the trial judge.
In due course, an order was made requiring the Cargill Parties to make such an application.[9]
[9]See par 27 below.
In substitution of the interim orders previously made, the Cargill Parties now apply for a more permanent confidentiality order maintaining the redaction of the various references to the Sale Figures in the transcript, at least in the immediate future.
For the reasons that follow, orders will be made to the effect that, subject to further order, those parts of the transcript that record references to the Sale Figures remain redacted until 30 January 2020, on condition that the Cargill Parties:
(1) File and serve further material justifying the maintenance of the orders by 27 September 2019.
(2) Within 5 days of the completion of the sale of Cargill’s Malt Business, inform the court of that fact.
B. Background
B.1 The proceeding
The key facts of this proceeding have been set out elsewhere and, for the purposes of this application, may be shortly stated.[10]
[10]For a more detailed account of the facts, see Cargill Australia Ltd v Viterra Malt Pty Ltd (No 2) [2017] VSC 283, [6]-[9]; Cargill Australia Ltd v Viterra Malt Pty Ltd [2017] VSC 126, [2]-[28] (Daly AsJ).
This proceeding was brought by Cargill Australia against the defendants (“the Viterra Parties”) following Cargill Australia’s acquisition of Joe White. The Viterra Parties consist of the 3 vendor companies: Viterra Malt Pty Ltd, Viterra Operations Ltd and Viterra Ltd, as well as Glencore International AG, the ultimate holding company (“Glencore”).
On 4 August 2013, Cargill Australia agreed to purchase Joe White from the Viterra Parties, save for Glencore, for the sum of A$420 million. The purchase was completed on 31 October 2013 (“the Acquisition”).
In brief, Cargill Australia alleges that, prior to the Acquisition, the Viterra Parties failed to disclose to it certain practices engaged in by Joe White, of which the Viterra Parties were aware (“the Viterra Practices”). It further alleges that the Viterra Practices were recorded and endorsed by certain written policies (“the Viterra Policies”). Cargill Australia claims that, had it known of the Viterra Practices or the Viterra Policies, it would not have executed the Acquisition Agreement or completed the Acquisition.
The Sale Figures are said to be relevant to 2 main aspects of the proceeding. Primarily, the Viterra Parties submit that they are relevant to the calculation of loss and damage alleged to have been suffered by Cargill Australia as a result of the Acquisition.[11] For this purpose, the Viterra Parties have provided the Sale Figures to their expert on loss and damage. The Sale Figures are referred to in a written opinion prepared by that expert and filed by the Viterra Parties.[12] In addition, the Viterra Parties submit that some of the Sale Figures are relevant to issues of causation of the alleged loss and damage.[13]
[11]See Cargill Australia Ltd v Viterra Malt Pty Ltd (No 9) [2018] VSC 433, [50]-[52].
[12]The Cargill Parties have not made an application for a confidentiality order in respect of that report, or the references to the Sale Figures contained within it, though the Sales Figures were not expressly referred to during the course of the expert’s evidence beyond those the subject of this application with respect to the hearing on 1 May 2019.
[13]See, for example, Cargill Australia Ltd v Viterra Malt Pty Ltd (No 17) [2018] VSC 750, [29].
B.2 The sale of Cargill’s Malt Business
On 21 December 2018, Cargill, Inc and Axéréal SA (“Axéréal”) publicly announced an intention to enter into an agreement by which Cargill, Inc would sell Cargill’s Malt Business to Boortmalt, Axéréal’s malt subsidiary.[14] Cargill’s Malt Business includes Joe White.
[14]This proposed sale had been foreshadowed earlier in the trial during the course of the cross-examination of Aimee Breszee, the second witness called by Cargill Australia: see Cargill Australia Ltd v Viterra Malt Pty Ltd (No 9) [2018] VSC 433, [2], [21]-[25]. Issues related to the disclosure and inspection of certain confidential documents regarding the proposed sale have been the subject of previous rulings: see, for example, Cargill Australia Ltd v Viterra (No 17) [2018] VSC 750, [26]-[61].
On 23 April 2019, an agreement for that sale was signed between Copagest NV (a subsidiary of Axéréal) and Cargill, Inc (“the Sale Agreement”).
Completion of the Sale Agreement, and the precise timing of completion, will depend on the counterparties satisfying various preconditions. However, completion is scheduled to occur between 31 August 2019 and 31 December 2019.
B.3 The confidentiality regime
The underlying circumstances giving rise to the confidentiality regime currently in place with respect to certain documents ordered to be discovered in this proceeding has already been extensively recounted.[15] It is sufficient for this ruling to observe that there is no issue that the documents and information relevant to the Sale Figures are confidential and that, both by agreement between the parties and by order of the court, the confidentiality of the information has been protected on an ongoing basis to date.[16]
[15]Cargill Australia Ltd v Viterra Malt Pty Ltd (No 17) [2018] VSC 750, [26]-[61], [278]-[285]. See also Cargill Australia Ltd v Viterra Malt Pty Ltd (No 9) [2018] VSC 433, [53]-[55]; Cargill Australia Ltd v Viterra Malt Pty Ltd (No 13) [2018] VSC 478, [5]-[6], [13]-[21]; Cargill Australia Ltd v Viterra Malt Pty Ltd (No 16) [2018] VSC 529, [6]-[7], [13]-[20].
[16]For completeness, s 7(a) and (b) of the Open Courts Act states that the Act does not limit or otherwise effect the making of an order or decision by a court that requires the disclosure of information or any rule of law restricting the permitted use and disclosure of such information.
B.4 Previous interim orders
To date, inadvertent references to the Sale Figures in open court have been largely addressed by a series of interim orders redacting those references in the transcript.
On 11 February 2019, in correspondence to the court, the Cargill Parties indicated that the court’s queries of counsel at that day’s hearing had included references to the Sale Figures. The Cargill Parties requested a direction that the relevant portions of that day’s transcript be redacted before the transcript was circulated. That direction was given, but formal orders were not made at that time.[17]
[17]This is a matter that will be revisited upon the delivery of this ruling.
On 23 April 2019, the Cargill Parties requested that references to the Sale Figures inadvertently made by senior counsel for the Viterra Parties at that day’s hearing be redacted from the transcript. The request was not opposed.[18] Accordingly, orders were made that day, which relevantly provided:
Subject to further order, references to the figures in Document 129 of the Project Colombo discovery and on page 37 of the draft agreement for the sale and purchase of [Cargill's Malt Business] be redacted from the transcript of the hearing on 23 April 2019, including figures converted from US dollars into Australian dollars.
[18]In correspondence received prior to making the orders, the court was advised that the Viterra Parties did “not consider … the order … in respect of redacting the transcript” necessary, but did “not oppose it”.
On 2 May 2019, in correspondence to the court, the Cargill Parties identified 6 references to the Sale Figures recorded in the transcript of 1 May 2019, and requested that the court make orders on the papers that those references be redacted and the transcript recirculated. That same day, in correspondence sent by the court to the parties, the Cargill Parties were invited to raise the matter in court the following day.
On 3 May 2019, that matter was raised. In light of senior counsel’s instructions as to the ongoing confidentiality of the EBITDA Multiple, I indicated that an order would be made for the redaction of all of the references identified, on the condition that the Cargill Parties provide an affidavit confirming those instructions.
Accordingly, on 6 May 2019, orders were made, which relevantly provided:
8.References to figures recorded at pages 7350.11, 7350.13, 7350.23, 7350.24 and 7350.29 of the transcript of the hearing on 1 May 2019 be redacted.
9.The reference to the earnings before interest, tax, depreciation and amortisation ("EBITDA") multiple, recorded at page 7350.12 of the transcript of the hearing on 1 May 2019 be redacted.
10.The Cargill Parties file and serve an affidavit of a senior legal practitioner at Gilbert + Tobin, which deposes to the confidential nature of the information redacted pursuant to paragraphs 8 and 9 above, by 4:00 pm on 7 May 2019.
On 7 May 2019, the Cargill Parties filed the required affidavit. The affidavit was sworn that day by Christiana McCudden, a solicitor acting for the Cargill Parties (“the McCudden Affidavit”).
In correspondence to the court enclosing the McCudden Affidavit, the Cargill Parties informed the court that, in the course of preparing that affidavit, 2 further references to the EBITDA Multiple had been identified in the transcript. The Cargill Parties indicated that they would seek an order redacting those references at the following day’s hearing.
On 8 May 2019, that further matter was raised. Orders were made, which relevantly provided:
Subject to further order, the reference to the earnings before interest, tax, depreciation and amortisation (“EBITDA”) multiple recorded at pages 7346.09 and 7361.30 of the transcript of the hearing on 1 May 2019 be redacted.
On 9 May 2019, further orders were made, timetabling the formal application for a confidentiality order in respect of the Sale Figures. Those orders relevantly provided that:
5.The Cargill Parties file and serve any material in support of their claim for confidentiality over the figures the subject of paragraphs 8 and 9 of the orders made … on 6 May 2019 and the orders made …. on 8 May 2019 (“the Cargill Parties’ Claim for Confidentiality”), by 4:00 pm on 17 May 2019.
6.Subject to further order, the hearing of the Cargill Parties’ Claim for Confidentiality is listed at 10:00 am on 21 May 2019.
C. The present application
The Cargill Parties now apply for a confidentiality order in respect of the Sale Figures. In particular, they apply for a confidentiality order maintaining the redaction of various inadvertent references to categories of confidential information in the transcript. The application was not opposed.[19]
[19]Neither the defendants nor any of the other third parties sought to act as a contradictor.
There appears not to be any case law in Victoria since the passage of the Open Courts Act 2013 (Vic) which directly relates to the making of an order of the type sought.[20]
[20]At the hearing of the application, and in written submissions, the Cargill Parties were unable to identify for the court any case law directly relating to, or addressing the principles applicable to, orders for the redaction of (or for the maintenance of redactions to) a trial transcript. Rather, reference was made to case law concerning related orders; primarily, orders restricting access to filed material.
Essentially, the application raises 3 questions for resolution.
The first question is a threshold question: Does the Open Courts Act apply to the order sought? (“Question 1”). In simple terms, the answer to Question 1 will depend on whether the order sought may be properly characterised as a “suppression order” as defined in the Open Courts Act.
The second question is: What is the correct approach to the making of the order sought? (“Question 2”). The answer to this question depends on the answer to Question 1. If the answer to Question 1 is “yes”, then the statutory presumption in favour of disclosure[21] and stipulations mandated by the Open Courts Act will apply, including the “general provisions for suppression orders” contained in Pt 2 of the Open Courts Act.[22] Alternatively, if the answer to Question 1 is “no”, then the general common law principle of open justice in the overall context of the administration of justice will apply, without the imposition of the requirements of the Open Courts Act.
[21]See s 4.
[22]Pt 2 contains provisions governing the making of (s 14), and scope (s 13) and duration (s 12) of “suppression orders”. Pt 2 also contains procedural requirements related to notice (s 10) and notification (s 11).
The third question is whether, in light of the applicable approach and legal principles, the order sought should be made? (“Question 3”).
D. Consideration
D.1 Question 1: Does the Open Courts Act apply?
D.1.1 Framework
Whether or not the Open Courts Act applies to a proposed order may involve a 2-stage enquiry.
The first stage is whether the proposed order is a type of order to which the Open Courts Act either expressly applies or expressly does not apply (“First Stage”). Self-evidently, if the answer to either of these enquiries is “yes”, then it is unnecessary to proceed further.
If, however, the order is not a type of order to which the Open Courts Act either expressly does or does not apply, then, it is necessary to proceed to the second stage of the enquiry.
The second stage is whether the order is, in substance and in practical effect, more akin to an order to which the Open Courts Act expressly applies or to an order to which the Open Courts Act expressly does not apply (“Second Stage”),[23] and, therefore, to which the Open Courts Act does or does not apply (as the case may be).
[23]Secretary, Department of Justice and Regulation v Zhong (No 2) [2017] VSCA 19, [3] (Santamaria, Ferguson and McLeish JJA) and the authorities there cited, esp ABC-1 v Ring [2014] VSC 5, [16] (Bell J).
The Open Courts Act aids both stages by identifying types of orders to which it does, and does not, apply.
The Open Courts Act expressly applies to “closed court orders”, and “suppression orders”. Only “suppression orders” are presently of possible relevance. “Suppression orders” are defined to include 4 types of orders.
The first is a “proceeding suppression order” made by a court or tribunal under s 17 of the Open Courts Act. A “proceeding suppression order” is an order:
to prohibit or restrict the disclosure by publication or otherwise of—
(a) a report of the whole or any part of a proceeding;
(b) any information derived from a proceeding.
(Emphasis added.)
The second is an interim order made under s 20 of the Open Courts Act in respect of an application for a “proceeding suppression order”. The third is a “broad suppression order”, which comprises orders that may be made in certain circumstances by the County Court or the Magistrates’ Court to restrain or prohibit the publication of certain material beyond the scope of a “proceeding suppression order”.[24] The fourth is a suppression order made in the exercise of the Supreme Court’s inherent jurisdiction, that:[25]
prohibits or restricts the publication or other disclosure of information in connection with any proceeding, whether or not the information was derived from the proceeding.
(Emphasis added.)
[24]See ss 25 and 26.
[25]Section 3.
It is apparent from this that the 4 types of “suppression orders” share a common characteristic: they restrict, restrain, or prohibit publication or other disclosure; that is, the dissemination or provision of information to the public or a section of the public.[26] In short, and broadly speaking, suppression orders presume the existence of, but are not intended to interfere with, primary court processes from which information is derived or by which information becomes available.[27] Rather, suppression orders are directed instead at dealing with processes by which intermediaries provide or disseminate to the public, or sections of the public, the information derived from, or made available by, those court processes.[28]
[26]Ibid, and, in particular, the definition of “publish”.
[27]See, for example, ss 1(a), 7, 17(b).
[28]See, for instance, Pt 2 of the Act which presumes that the suppression orders may affect intermediaries: see, for example, s 11, which requires the notification of relevant news media organisations, and s 15(1)(b)(v) and (vi), which provide for review of a suppression order on application by a news media organisation or any other person who has a sufficient interest.
The Open Courts Act also sets out types of orders to which it does not apply. Relevantly,[29] these are set out in s 7, and in particular:
[29]Section 8 provides that the Open Courts Act does not apply to orders made under legislation other than the Open Courts Act and is not presently relevant.
7Admission of evidence and disclosure of information to a court or tribunal or party to a proceeding
This Act does not limit or otherwise affect—
…
(d) the making of an order or decision by a court or tribunal that—
(i)conceals the identity of a person by restricting the way the person is referred to in open court;
(ii) restricts the way an event or thing may be referred to in open court;
(iii) prohibits or restricts access to a court or tribunal file.
(Emphasis added.)
As may be observed, the orders referred to in s 7(d) share a common characteristic: they restrict the availability (or more accurately, preserve the unavailability) of information ordinarily derived from court processes. In contrast to “suppression orders”, such orders or decisions are concerned with primary court processes by restricting the disclosure and availability of information ordinarily derived from those processes.[30] Moreover, the orders or decisions identified do not directly interfere with processes by which intermediaries provide or disseminate to the public the information made available by court processes.
[30]Also with the balance of s 7, each of the rules, orders and decisions described there relate to ordinary court processes: see further fn 16 above.
D.1.2 Analysis
In relation to the First Stage, the Cargill Parties made 2 interlocking submissions.
The first submission was that the order sought is not an order to which the Open Courts Act expressly applies, because it is not a “suppression order” as defined in the Open Courts Act.
This submission must be accepted. The order sought does not prohibit or restrict the publication or other disclosure of information. Put at its highest, the order indirectly limits the information which might by disclosed by concealing 1 discrete category of information: the Sale Figures. However, as the cases in relation to pseudonym orders establish, orders which conceal a discrete category of information in a proceeding, but which otherwise fully preserve the public nature of the proceeding, including the ability of the media to report on the proceeding, are not “suppression orders”.[31]
[31]See, for example, MSB v Chief Commissioner of Police [2018] VSCA 345, [48] (McLeish JA, with whom Maxwell P and Almond AJA agreed); Secretary, Department of Justice and Regulation v Zhong (No 2) [2017] VSCA 19, [3] (Santamaria, Ferguson and McLeish JJA) and the authorities there cited.
The related submission was that the order sought is an order which “restricts the way [a] … thing may be referred to in open court” and therefore the Open Courts Act expressly does not apply by operation of s 7(d)(ii). In support of this submission, the Cargill Parties cited the following passage in Bougainville Copper Ltd v RTG Mining Inc (No 1):[32]
The Court has inherent jurisdiction in civil and criminal matters, to make confidentiality orders … That could include an order prohibiting access to a Court file, which is a power not limited or affected by the Open Courts Act. It is commonly done in cases involving trade secrets or breach of confidence or trade practices, under orders that enable confined and controlled disclosure of documented evidence on undertakings to prevent injury by any disclosure of confidential or proprietary information. It would be a rare case though to order that a transcript of argument be treated as confidential. To go that far seems to me to involve making a suppression order on any information derived from a proceeding, which under the Open Courts Act would require a Court, in the present context, to be satisfied that such an order “is necessary to prevent a real substantial risk of prejudice to the proper administration of justice that cannot be prevented by other reasonably available means”.
(Original emphasis; citations omitted.)
[32](2018) 56 VR 129, 133-134 [13] (Mukhtar AsJ).
The related submission cannot be accepted for 2 reasons.
First, the confidentiality order sought could not be an order falling within s 7(d)(ii) because the language of that provision cannot accommodate it. Simply put, the order sought does not restrict “the way an event or thing may be referred to in open court”. Rather, the event or thing has actually been referred to. The order sought seeks to restrict the way in which that event or thing, however referred to in open court, may be subsequently recorded in the transcript.
Secondly, the passage cited does not support the proposition that the type of order presently sought falls within s 7(d)(ii). Specifically, that passage is concerned with an application for an order restricting a non-party’s access to the hearing transcript and the court file. In part at least,[33] such an order was an order of the type described in s 7(d)(iii).
[33]Ibid, 135-136 [19].
It follows that the answer to both First Stage enquiries concerning the express provisions of the Open Courts Act is “no”.
In relation to the Second Stage, the Cargill Parties made no submissions.
Nonetheless, the Second Stage of the enquiry establishes that the order sought is not an order to which the Open Courts Act applies. This is because, notwithstanding that the order sought does not fall squarely within the express categories identified in s 7, in substance and in practical effect it is more akin to a number of orders described in s 7 than to “suppression orders”. In effect, it is an extension to the confidentiality regime which has been court-sanctioned, to which the Open Courts Act does not apply.
To elaborate, the court has made orders, and the parties have given undertakings, to maintain the confidentiality of certain information. As already noted,[34] to the extent that the confidentiality regime has involved orders or decisions of the court, they plainly fall outside the Open Courts Act. It is only because the confidentiality regime has been inadvertently contravened that the information has found its way to the transcript.
[34]See fn 16 above.
Further, although the order sought does not fall within s 7(d)(ii), the practical effect of the order sought would be substantially the same as the parties complying with an order made in equivalent terms which is captured by that provision; that is, an order restricting reference to the Sale Figures in open court. The common, ultimate, outcome of compliance with such an order and the order presently sought would be the same: the absence of the Sale Figures from the transcript.
Accordingly, although the order sought may also have the practical effect of preventing the disclosure by publication or otherwise of the confidential information because that information is simply not available, that is merely a consequence of making orders necessary to maintain a regime that is clearly not covered by the Act.
Accordingly, Question 1 must be answered “no”.
D.2 Question 2: What is the correct approach?
As the answer to Question 1 is “no”, the correct approach is to consider the common law principle of open justice, which moderates the court’s power to make confidentiality orders in its inherent jurisdiction.[35]
[35]See, for example, Deputy Commissioner of Taxation v Karas (2011) 83 ATR 879, 881 [3] (Davies J). See generally John Fairfax & Sons Ltd v Police Tribunal (NSW) (1986) 5 NSWLR 465, 476E-476G (McHugh JA, with whom Glass JA agreed). That inherent jurisdiction of the Supreme Court remains unaffected by the Open Courts Act: s 5(1).
The principle of open justice is a fundamental rule of the common law,[36] and an “essential part of the functioning of courts in Australia”.[37] Indeed, general adherence to the principle of open justice is an essential characteristic of a court.[38]
[36]See John Fairfax & Sons Ltd v Police Tribunal (NSW) (1986) 5 NSWLR 465, 476G-477C; Russell v Russell (1976) 134 CLR 495, 520.4 (Gibbs J); Dickason v Dickason (1913) 17 CLR 50, 51.3 (Barton ACJ, with whom Isaacs, Gavan Duffy, Powers and Rich JJ agreed). The principle of open justice was discussed in an earlier ruling in the context of refusing an application for a pseudonym order: Cargill Australia Ltd v Viterra Malt Pty Ltd (No 21) [2019] VSC 182, [24]-[28].
[37]K-Generation Pty Ltd v Liquor Licensing Court (2009) 237 CLR 501, 512 [10] (French CJ).
[38]North Australian Aboriginal Justice Agency Limited v Northern Territoryof Australia (2015) 256 CLR 569, 594 [39.3] (French CJ, Kiefel and Bell JJ); Wainohu v New South Wales (2011) 243 CLR 181, 208-209 [44] (French CJ and Kiefel J); Russell v Russell (1976) 134 CLR 495, 520.4.
The principle of open justice requires that, save in exceptional circumstances, court proceedings occur in open court and, relevantly, that all of the evidence in court proceedings be available and accessible to the public.[39]
[39]Botsman v Bolitho [2018] VSCA 278, [244] (Tate, Whelan and Niall JJA). See also Hogan v Hinch (2011) 243 CLR 506, 530-532 [20]-[22] (French CJ).
The rationale of the principle of open justice is to expose court proceedings, and the evidence in court proceedings, to “public and professional scrutiny”.[40] Such scrutiny informs the public as to how judicial power is exercised, and on what evidential basis.[41] Relatedly, it helps ensure courts are held accountable, and so guards against the possibility of the misuse of judicial power.[42] As a result, it aids in maintaining public confidence in the integrity and independence of the courts.[43]
[40]Commissioner of the Australian Federal Police v Zhao (2015) 255 CLR 46, 60 [44] (French CJ, Hayne, Kiefel, Bell and Keane JJ).
[41]Dye v Commonwealth Securities Ltd (No 2) [2010] FCAFC 118, [121] (Marshall, Rares and Flick JJ).
[42]Ibid.
[43]Russell v Russell (1976) 134 CLR 495, 520.6.
In Victoria, the principle of open justice is recognised and reinforced by statute.[44] The Open Courts Act provides, within the context of that Act, for presumptions in favour of open court proceedings, and the disclosure of information.[45] The common purpose of those presumptions is to “strengthen and promote the principle of open justice”.[46] In addition, provisions of the Charter of Human Rights and Responsibilities Act 2006 (Vic) have been understood to constitute a statutory endorsement of the open justice principle.[47]
[44]See Commissioner of the Australian Federal Police v Zhao (2015) 255 CLR 46, 60 [44].
[45]Open Courts Act, ss 4, 28.
[46]Ibid.
[47]Section 24 (the right to a “fair and public hearing”) and s 15(2) (the right to freedom of expression, including the freedom to “seek and receive information”) have been so understood: AS v Minister for Immigration and Border Protection (No 10) (2017) 54 VR 500, 506-507 [21]-[22] (J Forrest J).
Whilst the principle of open justice is fundamental, it is not absolute.[48] This is because the principle of open justice is not an end in itself, but rather serves to aid a more fundamental principle; the administration of justice.[49] In circumstances where the presence of the public or public scrutiny of proceedings is likely to detract from, rather than enhance, the administration of justice, the principle of open justice may give way. Such circumstances, however, are exceptional.
[48]Botsman v Bolitho [2018] VSCA 278, [245] (Tate, Whelan and Niall JJA); Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532, 597 [189] (Crennan J).
[49]See Hogan v Australian Crime Commission (2010) 240 CLR 651, 667 [42] (French CJ, Gummow, Hayne, Heydon and Kiefel JJ) (observation made in the context of s 50 of the Federal Court of Australia Act 1976 (Cth)); R v Chief Registrar of Friendly Societies; ex parte New Cross Building Society [1984] QB 227, 235E (Sir John Donaldson MR, with whom Griffiths and Slade LJJ agreed); Scott v Scott [1913] AC 417, 437.5 (Viscount Haldane LC).
Any departure from the principle of open justice must be justified by the party or parties seeking such a departure,[50] and, if justified, extend no further, in scope,[51] and in time,[52] than strictly required for the administration of justice.[53]
[50]See, for example, Secretary, Department of Justice and Regulation v Zhong (No 2) [2017] VSCA 19, [3]-[4] (Santamaria, Ferguson and McLeish JJA); Hogan v Australian Crime Commission (2010) 240 CLR 651, 667 [43]; ABC v D1; ex parte The Herald & Weekly Times Ltd [2007] VSC 480, [62], [65], [67]-[68], [71] (J Forrest J).
[51]See, for example, General Television Corporation Pty Ltd v Director of Public Prosecutions (2008) 19 VR 68, 86 [62], 87 [65] (Warren CJ, Vincent and Kellam JJA).
[52]Ibid, 87 [65]. See also Northern Territory of Australia v Griffiths (dec’d) [2019] HCA 19, [8] (Nettle J); Hogan v Australian Crime Commission (2010) 240 CLR 651, 663 [29].
[53]Botsman v Bolitho [2018] VSCA 278, [245]; Matthews v AusNet Electricity Services Pty Ltd [2014] VSC 663, [437] (Osborn JA).
Relevantly, in certain circumstances, commercial confidentiality may be necessary to the administration of justice, and so permit a departure from the principle of open justice. In such circumstances, the court may make a confidentiality order. A confidentiality order may, amongst other things, restrict access to a transcript of a hearing, in whole or in part, or, as here, require that certain portions of a transcript be redacted or otherwise marked or treated as confidential.[54]
[54]See, for example, Hogan v Australian Crime Commission (2009) 177 FCR 205, 212 [17] (Jessup J), referring to an order made by Emmett J at first instance requiring, relevantly, the redaction of confidential names and terms from the hearing transcript. See also SPKB v Minister for Immigration and Multicultural & Indigenous Affairs [2003] FCAFC 296, [18] (Carr, Finn and Sundberg JJ), and Australian Competition and Consumer Commission v Reckitt Benckiser (Australia) Pty Ltd (No 2) [2015] FCA 1274, [8] (Edelman J).
In relation to the order presently sought, the following principles apply.
First, the court will only make a confidentiality order where confidentiality is necessary for the administration of justice. In other words, a confidentiality order:[55]
must be “necessary in order to serve the ends of justice”, “necessary to secure the proper administration of justice in proceedings” or necessary to avoid a course which would “destroy the attainment of justice in the particular case”.
(Citations omitted.)
[55]AA v BB (2013) 296 ALR 353, 388 [181] (Bell J).
Necessity is a stringent standard. It is not enough that a confidentiality order appear to be convenient, reasonable, sensible, or be perceived to be in the public interest, however understood, or that “as a result of some ‘balancing exercise’, the order appears to have one or more of those characteristics”.[56] Further, and for obvious reasons, it is not enough that the applicant merely wishes to avoid scrutiny or maintain confidence, or subjectively believes the orders sought to be necessary.[57] Furthermore, whilst relevant,[58] it is not enough that the parties to a proceeding agree that a confidentiality order should be made, or that, as here, an application for a confidentiality order is not opposed.[59] This is because the rationale of the principle of open justice is exposure to public scrutiny, to which the parties to a proceeding may be unanimously averse.
[56]Hogan v Australian Crime Commission (2010) 240 CLR 651, 664 [31] (French CJ, Gummow, Hayne, Heydon and Kiefel JJ). See also AA v BB (2013) 296 ALR 353, 388 [180]-[181]; Attorney-General (NSW) v Nationwide News Pty Ltd (2007) 73 NSWLR 635, 641 [31]-[33] (Hodgson JA, with whom Hislop and Latham JJ agreed).
[57]John Fairfax & Sons Ltd v Police Tribunal (NSW) (1986) 5 NSWLR 465, 477B (McHugh JA, with whom Glass JA agreed).
[58]See, for example, Guy v Crown Melbourne Limited (No 2) (2018) 355 ALR 420, 484 [249] (Mortimer J); Motorola Solutions, Inc v Hytera Communications Corporation Ltd (No 2) [2018] FCA 17, [18] (Perram J); Australian Broadcasting Commission v Parish (1980) 43 FLR 129, 156.8 (Deane J).
[59] Scott v Scott [1913] AC 417, 438.9 (Viscount Haldane LC).
Secondly, it is not enough that the applicant merely assert confidentiality in respect of the information sought to be protected; rather, the applicant must identify a basis for the court to maintain the confidentiality.[60] Relatedly, it is ordinarily for the applicant to adduce evidence upon which the court may reasonably conclude that the standard of necessity has been met.[61] Specifically, the applicant must ordinarily adduce evidence of some apprehended particular or specific harm or damage that disclosure of the information the subject of the proposed order would cause.[62]
[60]Hogan v Australian Crime Commission (2010) 240 CLR 651, 666 [38], citing, with approval, Hogan v Australian Crime Commission (2009) 177 FCR 205, 220-221 (Jessup J).
[61]John Fairfax & Sons Ltd v Police Tribunal (NSW) (1986) 5 NSWLR 465, 477B (McHugh JA, with whom Glass JA agreed).
[62]Hogan v Australian Crime Commission (2010) 240 CLR 651, 667 [41], [43].
Thirdly, the protection of commercially-sensitive information may, in appropriate cases, be necessary to the administration of justice.[63] This is because the administration of justice requires that controversies between parties be resolved without a party, or a non-party, suffering severe and collateral commercial harm.[64] As has been observed:[65]
Parties should not be deterred from coming to courts to enforce or protect their rights for fear that in doing so they will be forced to lose the very foundation of their commercial success … or that they may lose some competitive advantage that derives from material that they rightly consider to be confidential or secret.
For example, it is well-accepted that the principle of open justice may, in appropriate cases, accommodate the protection of trade-sensitive information, such as “prices and costs paid and incurred” for valuable items, supplier terms, and commercially-sensitive aspects of goods and services sold.[66]
[63]Re Hogan; ex parte West Australian Newspapers Ltd (2009) 41 WAR 288, 296 [33] (McLure P, with whom Owen and Miller JJA agreed). See also Alcoa of Australia Ltd v Apache Energy Ltd [2014] WASCA 148, [50]-[54] (McLure P, with whom Buss and Newnes JJA agreed); Australian Competition and Consumer Commission v Air New Zealand Ltd (No 3) [2012] FCA 1430, [35] (Perram J) and the authorities there cited.
[64]Australian Competition and Consumer Commission v Cement Australia Pty Ltd (No 2) [2010] FCA 1082, [13]-[14] (Greenwood J).
[65]Qantas Airways Limited v Rolls-RoycePLC [2010] FCA 1481, [21] (Rares J).
[66]See Australian Competition and Consumer Commission v Cement Australia Pty Ltd (No 2) [2010] FCA 1082, [13]-[14]; Qantas Airways Limited v Rolls-Royce PLC [2010] FCA 1481, [21]; Sportsbet Pty Ltd v New South Wales (No 12) [2010] FCA 62, [3]-[4] (Perram J); Siam Polyethylene v Minister of State for Home Affairs (No 3) [2009] FCA 839, [2]-[6] (Rares J). However note that whilst commercial sensitivity in the context of litigation between trade rivals weighs significantly in favour of “necessity”, it is not decisive: Cyclopet Pty Ltd v Australian Nuclear Science and Technology [2012] FCA 1326, [7] (Jacobson J).
Fourthly, where a confidentiality order is sought in respect of commercial information, it is for the applicant to establish that each piece of commercial information in respect of which a confidentiality order is sought has a confidential character warranting the protection of a court order.[67]
[67]Cyclopet Pty Ltd v Australian Nuclear Science and Technology Org [2012] FCA 1326, [8]; ICAP Australia Pty Ltd v Forrest Moebes [2010] NSWSC 738, [8] (Ball J) and the authorities there cited.
Fifthly, the strength of an asserted need for confidentiality will necessarily vary according to context, and in light of matters including:[68]
(1) The nature of the proceeding in which confidentiality is sought.
(2)The nature of the information in respect of which a confidentiality order is sought.
(3)Whether or not the information has already been received into evidence, or deployed in open court.[69]
(4)The likelihood and severity of collateral damage to participants in the court proceeding or others, absent the confidentiality order sought.
(5)The nature and extent of the confidentiality order sought and how it would operate to interfere with the principle of open justice.
[68]See, for example, Re Hogan; ex parte West Australian Newspapers Ltd (2009) 41 WAR 288, 296-297 [34] (McLure P, with whom Owen and Miller JJA agreed), 299 [50]-[51] (Owen JA, with whom Miller JA agreed); Cyclopet Pty Ltd v Australian Nuclear Science and Technology Org [2012] FCA 1326, [8].
[69]AS v Minister for Immigration and Border Protection (No 10) (2017) 54 VR 500, 507-508 [26]-[28] (J Forrest J); Deputy Commissioner of Taxation v Karas (2011) 83 ATR 879, 881 [4] (Davies J); Hogan v Australian Crime Commission (2010) 240 CLR 651, 667 [41]-[43].
Finally, it is necessary to consider what effect, if any, the making of a confidentiality order in respect of certain evidence may have on the ability of the court to provide cogent reasons for its judgment in a proceeding. As was observed in Wainohu v New South Wales,[70] the obligation on courts to provide adequate reasons for judgment is itself an aspect of the open justice principle.[71] Plainly, where certain evidence is made subject to a confidentiality order, the court may be deprived of the opportunity to include and openly refer to that evidence in its published reasons. Whether that constitutes a significant obstacle may depend on whether or not, without relying on the confidential information, and by formulating its reasons in more general terms, the court may nonetheless “convey an adequate account of the litigation and the reasons underlying the orders”.[72]
[70](2011) 243 CLR 181.
[71]At 215 [58] (French CJ and Kiefel J). See also Botsman v Bolitho [2018] VSCA 278, [244] (Tate, Whelan and Niall JJA); AK v Western Australia (2008) 232 CLR 438, 470 [89] (Heydon J), citing Murray Gleeson, “Judicial Accountability” (1995) 2 Judicial Review 117, 122.
[72]Gypsy Jokers Motorcycle Club Incorporated v Commissioner of Police (2008) 234 CLR 532, 596 [185] (Crennan J), citing David Syme & Co Ltd v General Motors-Holden’s Ltd [1984] 2 NSWLR 294, 300G-301A (Street CJ).
D.3 Question 3: Should the order sought be made?
In my opinion, an order should be made preserving the redaction of references to the Sale Figures in the transcript, at least until the completion of the sale of Cargill’s Malt Business.
For a number of reasons, I have formed that view having regard to, amongst other things, supporting material filed by the Cargill Parties comprising the McCudden Affidavit, and an affidavit sworn on 16 May 2019 by Eric De Munter, a vice president of Cargill, Inc’s corporate strategy and development group (“the De Munter Affidavit”) (together, “the Supporting Affidavits”).
First, evidence adduced by the Cargill Parties establishes that the Sale Figures are presently confidential, and, at least until the sale of Cargill’s Malt Business is complete, would be expected to remain so.
The Supporting Affidavits disclose, at a minimum, a contractual basis for the confidentiality of the Sale Figures.[73] A provision of the Sale Agreement requires that the parties to the Sale Agreement maintain in confidence, and not disclose, any “Confidential Information” for a period of 10 years. “Confidential Information” is defined to include, relevantly, any information received or held by a party in respect of the other, or the companies or businesses the subject of the Sale Agreement, and information “relating to the provisions of, and negotiations leading to” the Sale Agreement. Plainly, “Confidential Information” includes the Sale Figures.[74]
[73]In addition, the Cargill Parties submitted that there was a parallel equitable obligation of confidence attaching to the Sale Figures.
[74]However, that obligation is not absolute. The Sale Agreement recognises exceptions, including where the disclosing party has the written consent of its counterparty, and where disclosure of “Confidential Information” is required by a legal or regulatory requirement and the counterparty is notified and consulted.
Further, confidentiality in the Sale Figures has been, and will continue to be, maintained. Cargill, Inc, as a privately-owned company, is not subject to the legal or regulatory disclosure requirements applicable to publicly listed companies. To the extent Cargill, Inc discloses the Sale Figures to advisors or investors, it only does so on the basis that those advisors or investors agree to be bound by confidentiality obligations. Furthermore, Cargill, Inc does not publish financial results, including the EBITDA Multiple, for individual business units such as Cargill’s Malt Business. In addition, Axéréal, to the best of the Cargill Parties’ knowledge, is likewise not subject to any legal or regulatory requirements to disclose any of the Sale Figures.
Secondly, disclosure of the Sale Figures prior to completion may cause Cargill, Inc real and specific collateral commercial harm. At least at this time, disclosure of the Sale Figures, and any attendant harm, is not necessary to the administration of justice.
To elaborate, there remains a risk that completion will not occur. If the Sale Agreement does not complete, Cargill, Inc would be commercially disadvantaged by disclosure of the Sale Figures. As the Supporting Affidavits explain, this is because disclosure of the Sale Figures would be an obstacle to Cargill, Inc re-engaging and attempting to conduct a new sales process with bidders other than Axéréal. In particular, the disclosure of the Sale Figures would place Cargill at a “financial disadvantage” in any new sales process and render it “very unlikely” that alternative bidders would propose a price equal or greater to the Sale Price. The prospect of that harm may entirely dissipate, however, once completion occurs.[75]
[75]It was suggested that disclosure of the Sale Figures after completion may nonetheless harm Axéréal's relationship with its stakeholders, though the nature and likelihood of that harm was not articulated in detail.
Thirdly, and appropriately, in light of the previous point, the order proposed by the Cargill Parties is circumscribed in scope and duration so as not to exceed what is required for the administration of justice. Significantly, the Cargill Parties proposed an order that would: (1) persist no further than 30 January 2020, a point shortly after the latest anticipated completion date; and (2) be subject to review in light of updated supporting material to be filed by the Cargill Parties by 27 September 2019, or, if completion were to occur before then, shortly after completion.
Fourthly, the Sale Figures comprise commercially-sensitive information of a type well-recognised by the authorities to warrant, in appropriate cases such as the present, the protection of a confidentiality order.
Fifthly, the order is directed at repairing inadvertent references to the Sale Figures in open court, rather than restricting public access to evidence deliberately deployed in open court.[76]
[76]Cf Hogan v Australian Crime Commission (2010) 240 CLR 651, 667 [43] (French CJ, Gummow, Hayne, Heydon and Kiefel JJ).
Finally, although not decisive, it is nonetheless relevant that the Cargill Parties’ application was not opposed by the other parties to the proceeding.
For completeness, there is no need, presently, to consider what, if any, effect the order will have on the ability of the court to publish reasons which disclose the basis on which any judgment is delivered.[77] It is possible this issue may arise in the future, but that is for another day.
[77]See also Northern Territory of Australia v Griffiths (dec’d) [2019] HCA 19, [7] (Nettle J).
E. Conclusion
Accordingly, orders will be made to the effect that those parts of the transcript that record references to the Sale Figures remain redacted until 30 January 2020, on the conditions set out in paragraph 8 above.
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