Daycorp Pty Ltd v Parnell - [2011] SADC 191

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil: Appeal Under Freedom of Information Act)
DAYCORP P/L & ORS v PARNELL & ANOR
[2011] SADC 191
Judgment of His Honour Judge Millsteed
12 December 2011
ADMINISTRATIVE LAW - FREEDOM OF INFORMATION
Appeal against determination by Ombudsman that certain documents were not exempt under Schedule 1, Freedom of Information Act 1991 (SA) – whether Ombudsman’s reasons for determination were adequate – whether Ombudsman failed to consider all claims for exemption.
Held: reasons given in respect of some documents adequate and correct – reasons given in respect of “other documents” insufficient – in respect of “other documents” matter not remitted for further consideration by Ombudsman but determined by Court under s.42F District Court Act 1991 – appeal dismissed.
Freedom of Information Act 1991 ss20, 38, 39, 40; Development Act 1993 s24, referred to.
Re Saxon and Australian Maritime Authority (Cth AAT, 19 June 1995, unreported); Actors Equity Association of Australia (No 2) (1985) 7 ALD 584; AG v Cockcroft (1986) 64 ALR 97 (FC); Ipex Information Technology Group Pty Ltd v The Department of Information Technology Services South Australia (1997) 192 LSJS 54; Searle Australia Pty Ltd v Public Interest Advocacy Centre (1992) 36 FCR 111; Re Burns and Australian National University (1984) 6 ALD 193; Harris v Australian Broadcasting Corporation (1983) 78 FLR 236; Tunchon v Commissioner of Police, New South Wales Public Service [2000] NSWADT 73; James v Australian National University (1984) 2 AR 327; Htun v Minister for Immigration and Multicultural Affairs (2001) 194 ALR 244; Re Howard and Treasurer of the Commonwealth (1985) 3 AAR 169; Public Service Board (NSW) v Osmond (1986) 159 CLR 656; Pettitt v Dunkley [1971] 1 NSWLR 376; Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247; Papps v Police (2000) 77 SASR 210; R v Keyte [2000] 78 SASR 68; Re Rae and Department of Prime Minister and Cabinet (1986) 12 ALD 589; Bennett v Vice Chancellor, University of New South Wales [2000] NSWADT 8, considered.

DAYCORP P/L & ORS v PARNELL & ANOR
[2011] SADC 191
Introduction

This is an appeal pursuant to s40 of the Freedom of Information Act 1991 (SA) (the “FOIA”) by Daycorp Pty Ltd, Mt Barker Developments No 1 Pty Ltd Calomba Pty Ltd and Fairmont Group Pty Ltd (the consortium/appellants) against the determination of an external review by the Ombudsman in which the first respondent, the Hon. Mark Parnell MLC (“Mr Parnell”) was the applicant and, the second respondent, the Department of Planning and Local Government (DPLG), was the agency. On 24 June 2010 the Ombudsman reversed a decision by the agency that certain documents sought by Mr Parnell were exempt under Schedule 1 of the FOIA.
Background
At the time of the relevant events the appellants were a consortium of developers. In 2008 the Minister for Urban Development and Planning (the Minister) considered a proposal by the consortium to rezone rural land around Mount Barker for residential development. Consideration of the proposal occurred in the context of the government preparing “The 30-Year Plan for Greater Adelaide” (“the 30-year plan”) which was eventually released by the Minister in February 2010. The government had engaged private planning consultants including the firm Connor Holmes to prepare the “Growth Areas Report” to inform the preparation of the 30-year plan.
Implementation of the consortium’s proposal required amendment of the ‘Mount Barker Development Plan’ in accordance with the provisions of the Development Act 1993 (DA). In May 2009 the Minister commenced investigations into the merits of amending the Mount Barker Development Plan through the preparation of a Ministerial Development Plan Amendment (DPA) pursuant to s26 of the DA. The proposal was the subject of debate and attracted criticism from various persons including Mr Parnell. The DPA was subsequently prepared and released for public consultation in September 2010 pursuant to (s26(5)(d) and approved by the Minister on 10 December 2010 pursuant to (s26(8)) of the FOIA.[1]
[1] Notice of approval published in South Australian Government Gazette, 16 December 2010, p5655.
This appeal arises out of events that occurred prior to the preparation of the DPA.
By letter dated 18 June 2009 Mr Parnell applied to the agency under the FOIA for “any correspondence or other documents including emails, faxes, letters, file notes, or records involving Mr Dean Day and/or DayCorp concerning development in the Mount Barker region from 2005 to the present day”.
The agency located five documents that fell within the ambit of Mr Parnell’s application. The documents have been described in these proceedings as follows [2]:
1.04/07/2009         File note of meeting between DPLG staff and third party;
2.05/05/2009         Email string between DPLG and third party;
3.01/05/2009         Minute to Minister regarding initiation of ‘Mount Barker Township Expansion Development Plan Amendment’;
4.14/05/2009         Attachment to letter: ‘Mount Barker Township Expansion Development Plan Amendment’;
5.26/05/2009         Letter to Mr Day regarding proposed MDPA.
[2]    Documents exhibited to closed affidavit of Amanda Jane Nicholls sworn on 27 September 2010 (“Nicholls closed affidavit”) (FDN 7-AJN 13).
Amanda Jane Nicholls (“Ms Nicholls”), an accredited FOI officer with the agency, considered that the documents contained information relating to the business affairs of the consortium and Connor Holmes.
On 10 July 2009 Ms Nicholls wrote to Mr Dean Day of Daycorp Pty Ltd (“Daycorp”), a spokesperson for the consortium, and Mr Stephen Holmes, a director of Connor Holmes, seeking their views about the application.
By letter dated 14 August 2009, Natasha Marie Jones (“Ms Jones”), the consortium’s solicitor, advised Ms Nicholls that it was the consortium’s contention that documents 1,2,3 and 5 were exempt under various clauses contained in Schedule 1 of the FOIA[3]. No claim for exemption was made in respect of document 4. The agency received a similar response from Connor Holmes.
[3] Letter exhibited to closed affidavit of Natasha Marie Jones sworn on 1 September 2011 (“Jones closed affidavit”) (FDN 24 -“NMJ 2”).
Due to the unavailability of Ms Nicholls, responsibility for handling Mr Parnell’s application was given to Joy Rowett (“Ms Rowett”), another accredited FOI officer with the agency. On 27 August 2009 Ms Rowett made a determination pursuant to s 20(1)(a) of the FOIA refusing Mr Parnell access to the documents on the basis they were exempt.[4] The grounds for the refusal, and a brief description of each document, were set out in a schedule attached to Ms Rowett’s determination.
[4] Copy of determination by Ms Rowett exhibited to Nicholls open affidavit (FDN7-AJN 5).
By way of summary, she determined that the documents were exempt under the following clauses in Schedule 1:
·cl 7(1)(a) (disclosing trade secret) - documents 1, 2 and 3;
·cl 7(1)(c) (adversely affecting business affairs) - documents 1, 2 and 3;
·cl 8(1) (affecting conduct of research) - documents 1 and 5;
·cl 9 (internal working documents) - document 1;
·cl 13 (containing confidential material) - documents 1 and 2 ;
·cl 14 (affecting economy of the state) - documents 1, 2, 3, 4 and 5.
On 4 September 2009 Mr Parnell applied for an internal review of the determination pursuant to s38 of the FOIA.[5]
[5] Application for internal review exhibited to Nicholls open affidavit (FDN 7-“AJN 6”).
On 24 September 2009 Mr Ian Nightingale, Chief Executive Officer of the agency, wrote to Mr Parnell and advised that he had determined to confirm the original determination pursuant to s38(3).[6]
[6] Copy of determination by Mr Nightingale exhibited to Nicholls open affidavit (FDN 7-“AJN 8”).
On 12 October 2009 Mr Parnell applied to the Ombudsman for an external review of the determination pursuant to s39 (2) of the FOIA.
On 21 January 2001 Ms Nicholls advised the Ombudsman that an additional eight documents had been discovered which fell within the scope of Mr Parnell’s application. The documents have been described in these proceedings as follows:
6.110/03/2009      Minutes of Mount Barker District Council Meeting held on 10 March 2009 (attachment to document 3)
6.2Undated           Map, ‘Mount Barker Township Expansion-Area Affected Map 1’ (attachment to document 3)
7.01/04/2008      Unsigned letter to the Minister for Urban Development and Planning regarding Mount Barker Township (referred to in document 2)
8.08/10/2008      Minute to Minister for Urban Development and Planning regarding Mount Barker Township
9.16/06/2008      Letter to Minister for Urban Development and Planning regarding Mount Barker
10.06/08/2008      Letter from Minister for Urban Development and Planning regarding Mount Barker
11.14/08/2008      Letter to Minister for Urban Development and Planning regarding Mount Barker
12.Undated           Letter from Minister for Urban Development and Planning regarding Mount Barker
By letter to the agency dated 26 February 2010 the Ombudsman identified certain issues he considered to be relevant to the external review and invited submissions from the agency, the consortium and Connor Holmes.
By letter dated 21 April 2010 Mr Nightingale informed the Ombudsman that he had decided to vary his original decision.[7] He said:
In consideration of the extra documents found to be within scope during the more recent discovery for your external review, and considering the recent public release of the 30 Year Plan for Greater Adelaide, I have chosen to vary my original Internal Review decision and make a further determination regarding the FOI application in question.
It is determined to grant partial access to the documents requested in accordance with Sections 19 and 20 of the Freedom of Information Act 1992 [sic] (the Act). As outlined in attached schedule, it is determined to refuse access to Items 6.2, 7, 9 and 11 because the documents are considered to be exempt in accordance with Schedule 1(1), (9) and (14), or with Section 27(2) of the Act.
In addition, it is determined to grant partial release to Items 1, 2, 3, 5, 8, 10 and 12 in accordance with Section 20 of the Act. Due to parts of these documents being related to business affairs of third parties, it is determined to not release this information in accordance with 27(2) of the Act as consultation with the third party/ies has not been finalised. It is also determined to release in full the remaining documents, namely Items 4 and 6, in accordance with Section 19 of the Act. Please find attached a copy of the released documents.
In consideration of other points in your letter, it is more appropriate for Connor Holmes and Dean Day to respond because these points directly affect their business. In confirming the determination during the time of the original internal review, I was satisfied that the information presented by Connor Holmes and Dean Day was sufficient to justify the business affairs exemption.
Further to this, I recommend:
·    Forwarding a copy of this letter and a copy of the attached schedule and released documents within scope as per my further determination to Mr Parnell; and
·    Where the information relates to business affairs of third parties, DPLG supports the view held by Connor Holmes and Dean Day as to what is appropriate to be released.
[7]    Exhibited to Nicholls open affidavit (FDN 7-“AJN 10”).
The Ombudsman received written submissions from the consortium’s solicitor, Ms Jones, on 14 April 2010[8] and 7 June 2010[9] and also written submissions from Connor Holmes. The consortium conceded that four documents (3, 6.1, 10 and 12) were not exempt and contended that the remaining documents (1, 2, 5, 6.2, 7 (in part), 8, 9 and 11) were exempt under clauses 7(1)(c), 8(1) and 9(1) of Schedule 1 to the FOIA. The consortium asked the Ombudsman not to release its submissions to Mr Parnell except in a “modified” form to avoid disclosure of material claimed to be exempt.
[8] Exhibited to Jones closed affidavit (FDN 24-“NMJ 2”).
[9] Exhibited to Jones closed affidavit (FDN 24 -“NMJ 3”).
On 24 June 2010 the Ombudsman reversed the Agency’s determination pursuant to s39(11) of the FOIA on the basis that the eight documents which remained in dispute were not exempt. The Ombudsman published reasons for his determination. By virtue of s39(15)[10] of the FOIA the Ombudsman avoided mentioning in his reasons information which the consortium and Connor Holmes claimed was exempt. The Ombudsman attached to his determination an abridged version of the written submissions he had received from the consortium and Connor Holmes. The attachment also did not disclose information said to be exempt.
[10] s39(15): A relevant review authority should avoid disclosing in its reasons for a determination any matter that the agency claims is exempt matter (whether or not the relevant review authority agrees with that claim).
The Ombudsman indicated in his reasons that he did not consider Mr Nightingale’s letter of 21 April 2010 to be a further determination under s19(2a) of the FOIA but rather a “revision” of the agency’s position in respect of its determination. In the result, some of the information the consortium and Connor Holmes claimed to be exempt was no longer considered to be exempt by the agency contrary to its determination.
Before I turn to discuss the consortium’s claims and the Ombudsman’s reasons for determination it is appropriate to set out the relevant provisions of the FOIA.
FOIA
Purpose of legislation
The general objects of the legislation are articulated in s3 as follows:
(1)The objects of this Act are, consistently with the principle of the Executive Government’s responsibility to Parliament—
(a)to promote openness in government and accountability of Ministers of the Crown and other government agencies and thereby to enhance respect for the law and further the good government of the State; and
(b)to facilitate more effective participation by members of the public in the processes involved in the making and administration of laws and policies.
(2) The means by which it is intended to achieve these objects are as follows:
(a)ensuring that information concerning the operations of government (including, in particular, information concerning the rules and practices followed by government in its dealings with members of the public) is readily available to members of the public and to Members of Parliament; and
(b)conferring on each member of the public and on Members of Parliament a legally enforceable right to be given access to documents held by government, subject only to such restrictions as are consistent with the public interest (including maintenance of the effective conduct of public affairs through the free and frank expression of opinions) and the preservation of personal privacy; and
(c)enabling each member of the public to apply for the amendment of such government records concerning his or her personal affairs as are incomplete, incorrect, out-of-date or misleading.
(3)Nothing in this Act is intended to prevent or discourage the publication of information, the giving of access to documents or the amendment of records other wise than under this Act if it is proper and reasonable to do so or if it is permitted or required by or under any other Act or law.
Rights and exemptions
Section 12 provides that a person has a legally enforceable right to be given access to an agency’s documents in accordance with the FOIA. The right is subject to the operation of specific exclusions or exemptions. Relevantly, s20 (1)(a) stipulates that an agency may refuse access to a document if it is an “exempt document”.
An “exempt document” is defined in s3 as a document exempt by virtue of Schedule 1. Schedule 1 contains various clauses identifying exempt documents. The following clauses were relied upon by the consortium in the external review proceedings:
7—Documents affecting business affairs
(1)     A document is an exempt document—
(a)      …
(b)      …
(c)      if it contains matter—
(i) consisting of information (other than trade secrets or information referred to in paragraph (b)) concerning the business, professional, commercial or financial affairs of any agency or any other person; and
(ii) the disclosure of which-
(A)could reasonably be expected to have an adverse effect on those affairs or to prejudice the future supply of such information to the Government or to an agency; and
(B)would, on balance, be contrary to the public interest.
(2)A document is not an exempt document by virtue of this clause merely because it contains matter concerning the business, professional, commercial or financial affairs of the agency or other person by or on whose behalf an application for access to the document is made.
(3)A document is not an exempt document by virtue of this clause if it is a contract entered into by the Crown or an agency after the commencement of this subclause.
8—Documents affecting the conduct of research
(1)A document is an exempt document if it contains matter—
(a) that relates to the purpose or results of research (other than public opinion polling that does not relate directly to a contract or other commercial transaction that is still being negotiated), including research that is yet to be commenced or yet to be completed; and
(b) the disclosure of which—
(i)   could reasonably be expected to have an adverse effect on the agency or other person by or on whose behalf the research is being, or is intended to be, carried out; and
(ii) would, on balance, be contrary to the public interest.
(2)A document is not an exempt document by virtue of this clause merely because it contains matter concerning research that is being, or is intended to be, carried out by the agency or other person by or on whose behalf an application for access to the document is made.
9—Internal working documents
(1)A document is an exempt document if it contains matter—
(a) that relates to—
(i)any opinion, advice or recommendation that has been obtained, prepared or recorded; or
(ii)any consultation or deliberation that has taken place,
in the course of, or for the purpose of, the decision-making functions of the Government, a Minister or an agency; and
(b)the disclosure of which would, on balance, be contrary to the public interest.
(2)A document is not an exempt document by virtue of this clause if it merely consists of—
(a) matter that appears in an agency’s policy document; or
(b) factual or statistical material.
The test in clause 7(1)(c) comprises three limbs each of which must be satisfied before a document qualifies for exemption.
First, the document must contain information concerning the “business, professional commercial or financial affairs” of the agency or any other person. This expression has been described as covering all aspects of an organisation both fiscal and administrative.[11]
[11] See Re Saxon and Australian Maritime Authority (Cth AAT, 19 June 1995, unreported) at 25, cited in A Cossins, Annotated Freedom of Information Act, New South Wales, LBC Information Services, Sydney, 1997, [107.13] and M. Paterson, Freedom of Information and Privacy in Australia, LexisNexis Butterworths, Australia, 2005, [6.47].

The second limb contains two alternative requirements. First, that disclosure of the information “could reasonably be expected to have an adverse effect” on either “the business, professional commercial or financial affairs of the agency or some other person” or “the future supply of such information to the government or to the agency”. The concept of reasonable expectation of an adverse effect requires “a foundation for a finding that there is an expectation of adverse effect that is not fanciful or contrived” or “irrational, absurd or ridiculous”.[12] However, the words “could reasonably be expected” must be given their ordinary meaning. Accordingly, a proper application of the test does not mean that something which is not “fanciful or contrived” or “irrational, absurd or ridiculous” must automatically be regarded as reasonable.[13]
[12] Re Actors Equity Association of Australia(No2) (1985) 7 ALD 584 at 590; AG v Cockcroft (1986) 64 ALR 97 (FC) at 106; Ipex Information Technology Group Pty Ltd v The Department of Information Technology Services South Australia (Judge Lunn) (1997) 192 LSJS 54.
[13] Searle Australia Pty td v Public Interest Advocacy Centre (1992) 36FCR 111(FC) at 125.
The third limb of the test is that disclosure “would, on balance, be contrary to the public interest”. The test is not whether disclosure would be in the public interest but whether it would be contrary to the public interest.[14] In considering whether disclosure would have that result it is necessary to weigh the public interest in citizens being informed of the processes of their government and its agencies against the public interest in the proper working of government and its agencies.[15] Any specific adverse effect that disclosure could reasonably be expected to cause is a relevant consideration. As Paterson observed:[16]
[14] Re Burns and Australian National University (1984) 6 ALD 193 at 197.
[15] Harris v Australian Broadcasting Corporation (1983) 78 FLR 236 at 246.
[16] M. Paterson, Freedom of Information and Privacy in Australia, LexisNexis Butterworths, Australia, 2005, [5.23].
There is a general public interest in favour of disclosure inherent in the objectives of the legislation which may be augmented by factors specific to an individual document or request. That interest must be balanced against any potential harm to an interest which is protected by the exemption provision.
Where a provision specifies some finding of harm, the fact that this has been made out suggests that there is an interest against disclosure which must be counterbalanced by arguments in favour of transparency.
The test contained in clause 8 also comprises three limbs. First the document must contain matter that “relates to the purpose or results of research” including research yet to be commenced or completed; second, that disclosure of the matter “could reasonably be expected to have an adverse effect on the agency or other person by or on whose behalf the research is being or is intended to be carried out”; and, third, that disclosure “would, on balance, be contrary to the public interest”.
By contrast to clauses 7(1)(c) and 8(1), clause 9(1) does not require that disclosure have a specified effect. The test consists of two limbs both of which must be satisfied before a document qualifies for exemption. First, the document must fall within a particular class i.e. it must contain matter relating to “any opinion, advice or recommendation that has been obtained, prepared or recorded or any consultation or deliberation that has taken place in the course of, for the purpose of, the decision-making functions of the Government, a Minister or an agency”. Central to this class of documents are advising and deliberative documents which may influence or reflect the “thinking” of government decision-makers when performing a “decision-making function”.[17] This potentially encompasses most documents produced in the course of decision making or policy formulation by a minister or agency other than matter which has only an administrative purpose.[18]
[17] Tunchon v Commissioner of Police, New South Wales Public Service [2000] NSWADT 73 at [14].
[18] James v Australian National University (1984) 2 AR 327 at 334-5 cited in M. Paterson, Freedom of Information and Privacy in Australia, LexisNexis Butterworths, Australia, 2005, [7.5].
The second limb is that disclosure would, on balance, be contrary to the public interest. In Tunchon v Commissioner of Police, New South Wales Public Service[19] the Administrative Decisions Tribunal interpreted an identical clause in the New South Wales FOIA as requiring a neutral stance in respect of the application of the public interest test:[20]
15.     It has been suggested that this public interest test is an “open” test, in the sense that the exemption does not itself raise any particular public interest favouring secrecy which is to be brought into the balance (c.f. Re Bartl and Secretary, Department of Employment, Education, Training and Youth Affairs (1998) 28 AAR 140 at 148). However, I think it is of more assistance to understand the paragraph (b) test by reflecting on the objects of the exemption as indicated in the class of documents raised for consideration by paragraph (a). From this openness should accompany or follow government decision-making in some cases, but that in other cases “the public interest” requires secrecy. The “neutrality” of this position, prevents approaching the exemption from any general assumption or presumption on the necessity of secrecy or openness of government deliberative documents. The inevitable construction is that the Act intends that choosing between these outcomes must depend upon an assessment of the effects of a present disclosure of the document in the particular circumstances in which the document was or will be used in its particular “decision-making” context.
16.     In other words, I consider that the exemption requires me to identify the circumstances surrounding the particular decision-making, discover the role which has been or is to be played by the document in that decision-making, and consider the extent to which retaining secrecy for the document is at present necessary for “the proper administration of the Government” in that particular decision-making process (c.f. s 5(2)(b)).
17.     This inevitably requires a “value judgment” as to the “public interest” on what level of openness should accompany or follow the particular decision-making process. Such judgments can be difficult to form and rationally to explain. For my part, I am assisted by parties informing my judgment by leading evidence on contemporary standards of openness from decision-makers and experts in the relevant field of decision-making.
Presumption of disclosure?
[19] Tunchon v Commissioner of Police, New South Wales Public Service [2000] NSWADT 73 at [14].
[20] Tunchon v Commissioner of Police, New South Wales Public Service [2000] NSWADT 73 at [15]-[17].
There is conflicting case law on the question of whether the right of access under FOI legislation should be understood to implement the general objects of the legislation and that the exemptions should therefore be interpreted narrowly so as to extend as far as possible the community’s right of access. This has been described as the ‘leaning approach’.[21]
[21] See M. Paterson, Freedom of Information and Privacy in Australia, LexisNexis Butterworths, Australia, 2005, [2.5] and cases discussed therein. See also P Bayne and K Rubenstein, 'The Objects of the Freedom of Information (FOI) Acts and their Interpretation' (1995) 2 Australian Journal of Administrative Law 114.
In Ipex Information Technology Group Pty Ltd v The Department of Information Technology Services South Australia (Ipex)[22] Judge Lunn discussed the conflicting authorities and rejected the leaning approach. He said:[23]
[22] Ipex Information Technology Group Pty Ltd v The Department of Information Technology Services South Australia (1997) 192 LSJS 54.
[23] Ipex Information Technology Group Pty Ltd v The Department of Information Technology Services South Australia (1997) 192 LSJS 54 at 60-61.
Counsel for Ipex contended that s3 of the FOIA created a presumption in favour of disclosure in circumstances where the exemptions are to be given a narrow application, and that there should be a “leaning approach” in favour of disclosure. The respondent denied this. Regrettably a number of superior Courts have made varying pronouncements on the point without apparent reference to what other Courts have said on the topic.
In relation to a similar provision in the Victorian Freedom Of Information Act 1982 the High Court said in Victorian Public Service Board v Wright (1986) 160 CLR 145 at pp153-4:
“…in the light of these sections it is proper to give to the relevant provisions of the Act a construction which would further, rather than hinder, free access to information. It is, in our view, evident that such a purpose would not be promoted by adopting a narrow construction of the appellate functions of the County Court under the Act or by imposing any limitation upon the effect of its decisions beyond any limits plainly imposed by the Act itself. …”
In Searle Australia Pty Ltd v Public Interest Advocacy Centre (1992) 108 ALR 163 at 167-8 (“Searle’s case”) the Full Court of the Federal Court held in relation to a similar provision in the Commonwealth Freedom Of Information Act 1982 that there was no leaning in favour of disclosure and that what the High Court had said in Victorian Public Service Board v Wright (supra) was consistent with what an earlier Full Court of the Federal Court has said in News Corporation Ltd v NCSC (1984) 52 ALR 277 at 279:
“In construing our Act we do not favour the adoption of a leaning position. The rights of access and the exemptions are designed to give a correct balance of the competing public interests involved. Each is to be interpreted according to the words used, bearing in mind the stated object of the Act.”
I consider this to be the correct approach in interpreting the FOIA.
I respectfully agree with Judge Lunn’s remarks. As far as I am aware the ‘leaning approach’ has not been followed by any court in this state.
External review proceedings
The powers and obligations of the Ombudsman conducting an external review are set out in s39.
The Ombudsman may (based on the circumstances existing at the time of the review) confirm, vary or reverse the determination the subject of the review (s39(11)) and on making a determination must notify the applicant, the agency and, any interested person, of the determination and the reasons for the determination (s39(13)). If the Ombudsman considers it to be in the public interest or the interests of an agency to do so, he may publish in such manner as he thinks fit, the reasons for a determination (s39(14)) but is required to avoid disclosing in his reasons any matter that the agency claims is exempt matter, whether or not he agrees with that claim (s39(15)).
Section 48 provides that in any proceedings concerning a determination under the FOIA by an agency, the burden of establishing that the determination is justified lies on the agency.
When faced with multiple claims for exemptions an external review authority is obliged to consider each claim and to determine whether it satisfies the test(s) of exemption relied upon by the agency or a third party. A failure to conduct the review in accordance with these principles constitutes jurisdictional error, as illustrated by the decision of the Federal Court in Htun v Minister for Immigration and Multicultural Affairs. [24]
[24] Htun v Minister for Immigration and Multicultural Affairs (2001) 194 ALR 244.
In Htun the appellant, a Burmese National, applied for a protection visa on the basis that he was at risk of persecution from the Burmese authorities. The application was refused by a delegate of the Minister whose decision was affirmed by the Refugee Review Tribunal (the tribunal) pursuant to s414 of the Migration Act 1958 (Cth). On appeal the Federal Court held that the tribunal had failed to exercise its jurisdiction by not dealing with an ethnicity based claim raised in the initial visa application.
Merkel J said:[25]
While it may be convenient for the Tribunal to deal separately with each element of the claim, that does not relieve it of the task of addressing, cumulatively, all of the essential elements of the claim raised by the material or evidence. In that regard, the Tribunal, in conducting its review of the decision of the delegate under s 414 of the Migration Act 1958 (Cth), is under a duty of address or deal with the case (ie the claim) actually raised by the material or evidence: see Chen v Minister for Immigration and Multicultural Affairs [2000] FCA 1901; (2000) 106 FCR 157 at 180 and Minister for Immigration and Multicultural Affairs v Sarrazola [2001] FCA 263; (2001) 107 FCR 184 at 196, Sellamuthu v Minister for Immigration and Multicultural Affairs [1999] FCA 247; (1999) 90 FCR 287 at 293-294.
On a fair reading of the Tribunal’s reasons it did not address or deal with all of the essential elements of the appellant’s claim.
[25] Htun v Minister for Immigration and Multicultural Affairs (2001) 194 ALR 244 at [7]-[8].
Merkel J went on to say:[26]
Accordingly, the tribunal failed to conduct its review in accordance with duties imposed upon it under the Act and therefore constructively failed to exercise its jurisdiction or ignored relevant material: see s476 (1)(b) and (c) and Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323…at [81]-[83] Put another way, the tribunal “should have examined, but did not examine” the issues to which I have referred and thereby fell into jurisdictional error: see Adebe v Commonwealth (1999) 197 CLR 510 AT 537…per Gleeson CJ and Mc Hugh J.
[26] Htun v Minister for Immigration and Multicultural Affairs (2001) 194 ALR 244 at [14].
Similarly, Allsop J said:[27]
The Tribunal failed to address and deal with how the claim was put to it, at least in part. The requirement to review the decision under s 414 of the Act requires the Tribunal to consider the claims of the applicant. To make a decision without having considered all the claims is to fail to complete the exercise of jurisdiction embarked on. The claim or claims and its or their component integers are considerations made mandatorily relevant by the Act for consideration in the sense discussed in Minister for Aboriginal Affairs v Peko Wallsend ; and Minister for Immigration and Multicultural Affairs v Yusuf . … It is to be distinguished from errant fact finding. The nature and extent of the task of the Tribunal revealed by the terms of the Act, eg ss 54, 57, 65, 414, 415, 423, 424, 425, 427 and 428 and the express reference in Regulation 866 to the “claims” of the applicant eg 866.211, make it clear that the Tribunal’s statutorily required task is to examine and deal with the claims for asylum made by the applicant. If there is a sur place claim made in addition to a claim based on conduct or experiences elsewhere both must be dealt with. If the sur place claim is, or is to be seen as, based on more than one foundation – that is, what has been done by way of political activity and also because of friendships made with other Karen people of arguably seriously subversive background, both bases of the claim must be dealt with. The Tribunal did not deal with the latter basis of the appellant’s sur place claim based on imputed political opinion. It was not a failure merely to attend to evidence, even probative evidence, and by such route commit a factual error. It was a failure to deal with one part of the claim for asylum ….
(my emphasis-citations omitted)
[27] Htun v Minister for Immigration and Multicultural Affairs (2001) 194 ALR 244 at [42].
Consortium’s claims
As earlier observed, the consortium’s written submissions were sent to Ms Nicholls on 14 August 2009[28] and to the Ombudsman on 14 April 2010[29] and 7 June 2010[30]. Set out below is my summary of those submissions. The summary is slightly more expansive than the Ombudsman’s abridged version but, nevertheless, avoids disclosing information the consortium claims to be exempt.
[28] Exhibited to Jones closed affidavit (FDN 24 -“NMJ 2”).
[29] Exhibited to Jones closed affidavit (FDN 24 -“NMJ 2”).
[30] Exhibited to Jones closed affidavit (FDN 24 -“NMJ 3”).
Documents 1 and 2
The consortium’s written submissions of 14 August 2009 and 14 April 2010 assert that document 1 (file note of meeting between DPLG staff and third party on 4 July 2008) and document 2 (e-mail string between DPLG and third party dated 5 May 2009) were exempt under clause 7(1)(c) and that document 1 was also exempt under clauses 8 and 9.
Clause 7(1)(c)
The consortium argued that documents 1 and 2 contained information concerning its dealings with DPLG in respect of the proposed rezoning of land at Mount Barker. The information therefore related to the “business, professional, commercial affairs” of the consortium (cl 7(1)(c)(i)).
The consortium submitted in essence that the information mentioned its relationship with a third party whose professional probity in respect of a particular matter had been criticised. The third party, and others, had rejected the criticism as wrong and unfair. Nevertheless the consortium expressed concern that disclosure of the information in documents 1 and 2 could result in the consortium being unfairly and unjustifiably tainted by reason of its relationship with the third party and, thus, “could reasonably be expected to have an adverse effect” on the business and commercial affairs of the individual members of the consortium (cl 7(1)(c)(ii)(A)).
The consortium further submitted that disclosure would be contrary to the public interest (cl 7(1)(c)(ii)(B)) because the information appears in communications to the DPLG that were made by a third party on the understanding that they were to be treated as confidential. The consortium contended that disclosure of such communications would deter the third party, the consortium and other developers from dealing with the DPLG and other government departments in the future.
Clause 8
The consortium submitted that document 1 contained references to studies, statistics and research put forward in support of the proposal to rezone Mount Barker and, thus, contained information relating to the “purpose or results of research” (cl 8(1)(a)). The research related in part to a proposal by the consortium to provide certain infrastructure. The consortium argued that disclosure of the proposal would have an adverse effect on the consortium (cl 8(1)(b)(i)) for the following reasons:
·The proposal to provide infrastructure “may not have not yet been finally decided or communicated to others”;
·The information might prejudice the consortium’s future dealings and/on going relationships with third parties who were not privy to the reasoning behind and the context of the information contained in the documents.
·The consortium’s competitors stood to gain an unfair advantage (at the expense of the consortium) from obtaining knowledge of the professional opinions and the nature of the work undertaken by the consortium.
The consortium contended that disclosure would be contrary to the public interest because investigation into the rezoning proposal was still continuing and that “premature release of the information will mislead and / or encourage ill informed speculation and may cause unnecessary concern for those residing in particular areas”(cl 8(1)(b)(ii)).
Clause 9 (1)
The consortium submitted that document 1 contained “advice” regarding the proposed DPA which was given for the “purpose of the decision making functions” of the Minister (cl 9(1)(a)) and that disclosure would be contrary to the public interest (cl 9(1)(b)) because the deliberative processes of the Minister must be protected. Furthermore, the consortium had not finally determined that it would provide the infrastructure referred to in the documents. In those circumstances disclosure might give rise to a false hope or expectation on the part of the public that the infrastructure would be provided.
Documents 6.2, 7, 8, 9 and 11

The consortium’s claims for exemption in respect of the remaining documents are set out in its written submissions of 7 June 2010.
The consortium contended that document 6.2 (map of area affected by Mount Barker township expansion), and documents 7, 9 and 11 (letters to the Minister regarding the rezoning proposal dated 1 April 2008, 16 June 2008 and 14 August 2008) were all exempt under clauses 7(1)(c) and 9(1). The consortium submitted that document 8 (minute to the Minister regarding the proposal dated 8 August 2008) was exempt under clause 9(1) only.
Clause 7(1)(c)
The consortium submitted that documents 6.2, 7 (in part), 9 and 11 contained information concerning the “business, professional commercial or financial affairs” of the consortium (cl 7(1)(c)(i)) in that that information related to the following:
·areas surrounding Mount Barker that would be affected by township expansion;
·proposed infrastructure installation and upgrades and land use and related concept plans;
·performance indicators for the proposal;
·the number of potential residential allotments, open space areas and years of available land supply; and
·time tables governing the viability of the proposal.
The consortium submitted that disclosure of the information relating to the above mentioned matters would have an adverse affect on the consortium’s business affairs “as it may cause unnecessary and misdirected criticism of the consortium’s proposal before a Ministerial Development Plan Amendment is prepared and released for public consultation”(cl 7(1)(c)(ii)(A)).
It was further submitted that the documents were provided to the Minister on the understanding that the details contained in the documents would remain confidential and that disclosure of such information would be contrary to the public interest (cl 7(10)(c)(ii)(B)) because:
·the release of the information would damage the commercial relationship between the government and the consortium;
·future disclosure and open communication , particularly in respect of detailed preliminary ideas and concepts for the township development may be undermined;
·the consortium and other large developers may be reluctant to disclose such detailed information concerning their projects in the future; and
·the release of the information would lead to misdirected criticism of the consortium and its proposal, which was only in its preliminary stages, before the DPA was finalised for public consultation.
Clause 9 (1)
The consortium submitted that each of the documents 6.2, 7, 8, 9 and 11 contain matter that related to “opinion, advice or recommendation(s)” obtained, prepared or recorded in the course of, or for the purpose of the decision making functions of the Minister (cl 9(1)(a)) in that:
·document 6 (map of Mount Barker showing certain logistical details) was preferred in support of the consortium’s proposal;
·document 8 (minute to the Minister) contained opinions and advice from Planning SA in respect of the proposed rezoning;
·documents 7, 9 and 11 (letters to the Minister from third party) contained various opinions and recommendations provided to the Minister in respect of the consortium’s proposal.
The consortium submitted that disclosure of the information contained in the documents would be contrary to the public interest (cl 9(1)(b)) because the information related to matters which were only preliminary in nature and disclosure might cause “members of the public to develop expectations that certain works will definitely occur” and could result in “premature prejudgment of the proposed DPA by the public”.
Ombudsman’s reasons
The Ombudsman commenced his reasons by setting out the history of the matter and some “overarching comments” in which he expressed the view that commercial entities were unjustifiably prone to claiming that information, relating to commercial matters, was either confidential or exempt under the business affairs provisions in the FOIA. The Ombudsman emphasised that the provision of information to government, on a so called confidential basis, does not render such information immune from disclosure under the FOIA.
He said:
24.    The government often engages in commercial dealings with individuals and commercial entities, and it cannot be expected that all information concerning these dealings will be kept from the public. The government cannot, as a private person or business might purport to, give a blanket assurance that all information provided to it will be kept secret or ‘confidential’. The government must always act in the public interest, whether or not it is fulfilling its obligations under the Development Act, engaging in commercial dealings with other entities, or putting out tenders for services. The government is accountable for its decisions and actions, and this may necessitate releasing information concerning other parties. If no information, or substantially no information about a commercial enterprise or a tender process involving the government is released, the openness and accountability of the project or process will suffer. In my view the FOI Act (see, in particular, the objects of the FOI Act) is at odds with any notion of blanket confidentiality over commercial matters.
25. This is not to say that all information relating to commercial matters will be released to the public if it is requested. In certain circumstances, it may be appropriate that particular information held by the government concerning the affairs of commercial entities is not released if it is sought under the FOI Act. Obvious examples might include trade secrets and specific financial capabilities. In these circumstances, it is usually easy to tie the particular information to clauses 7 and 13 of Schedule 1 to the FOI Act. This does not give rise to a blanket claim however.
26.    I note that Judge Lunn in Ipex Information Technology Group Pty Ltd v The Department of Information Technology Services South Australia (1997) 192 LSJS 54 (Ipex) stated in relation to a commercial tender process:
Part of the tender documents stated:
“4 FOIA. The main objective of the FOIA is to extend as far as possible the rights of the public to obtain access of information held by Government. However, proprietary technical data, trade secrets and other information concerning the business, professional, commercial and financial affairs of a business which are contained in tender submissions are exempt from the provisions of the Act. These matters will remain confidential and will not be released to anyone without the written permission of the tenderer who provided that information. Other information about the purchase tender, for example, the evaluation methodology may be disclosed provided that the application is in writing and the prescribed fee is paid in advance. The tendered price will not be disclosed without the prior consultation with the tenderer. Where the decision is taken to disclose the tender price despite the tenderer’s objection, the tenderer will be informed of their rights of review or appeal under the FOIA, and the price will not be disclosed until after those review or appeal periods have expired. However because the tendered price is only one of the factors in awarding a contract it is government policy not to release the price without a detailed explanation of the evaluation methodology.”
It is unfortunate that this appeared in the document as it is not an entirely correct explanation of the legal position under the FOIA. It was suggested that insofar as tenderers could have expected their tender information to have been kept confidential in accordance with the passage cited above they would be reluctant in future to supply information on tenders to the government if more information was released on these tenders than the government had said would be released. The short answer to this is that the appellant’s position cannot be prejudiced by the government having misrepresented, if that be the case, to tenderers what may or may not be kept confidential under the FOIA. Tenderers are deemed to have notice of the provisions of the FOIA and what its legal effect might be. In any event there is always the risk of compulsory disclosure to competitors under legal process such as Rule 60.
I do not find that any basis of exemption has been proved by the respondent on the grounds that the disclosure could reasonably be expected to have prejudiced the future supply of such information to the Government. It is neither subjectively nor objectively established by the respondent. I need not deal with the respondent’s contention that any slight prejudice is sufficient for (c)(ii), in a similar way to “adverse effect”, rather than prejudice on balance because there is no evidence to establish even slight prejudice.
27.Later, with respect to clause 9, Judge Lunn stated:
It was submitted that the confidentiality of information was a factor in assessing what was in the public interest: Sankey v Whitlam (1978) 142 CLR 1 at 42. Claims here for exemption on grounds of confidentially under Clause 13 of the Schedule were abandoned, but that does not mean that confidentiality in conjunction with other factors may not be relevant to the public interest. However, as was stated in relation to Clause 7(1)(c)(ii), the degree of confidentiality which could be expected is always subject to the provisions of the FOIA and cannot be affected by any representation by the respondent that greater confidentiality might be accorded to material than properly reflects the effect of the FOIA. The degree of confidentiality will generally lessen with the passage of time.
28.    Whilst Ipex related to a particular tender process, in my view Judge Lunn’s comments are relevant not only to tender processes in general, but also to commercial enterprises involving the government generally.
29.    Using tenders as an example of individuals doing business with the government, Connor Holmes believes that releasing documents in this matter would reduce the flow of information and the quality of tenders to the government in the future. As a general proposition, I cannot accept that this would be the case. I have already accepted that in certain circumstances, particular information may be exempt from release to the public. A distinction needs to be drawn however between, say, the recipe for Coca-Cola and ‘any and all’ information relating to tenders or business transactions.
30.    In my view it is in a tenderer’s interests to provide all information supportive of its tender, or information required by the government agency conducting the tender process. A failure to provide all supporting information, or being restrictive in the information provided, will decrease a tenderer’s chances of success. If there is specific information a tenderer would like to keep confidential, it would be wise, at the time of submitting the tender, for the information to be specified and the importance of non-disclosure explained. Even so, there would still be no guarantee of confidentiality, and if the information is requested under the FOI Act, the question of release will depend upon whether the specific matter satisfies the requirements of an exemption provision. It needs to be said however that information relating to tenders is released to the public, both in this and other jurisdictions. I am not convinced by the general assertion that businesses will forego the chance of gaining lucrative deals with the government merely due to the possibility of tender information being disclosed to the public.
31. My views regarding tender processes also apply in circumstances where a business entity wants something from the government, such as in the present matter where the Minister was approached and asked to make a particular decision under the Development Act. I am not convinced by the general assertion that businesses will forego the chance of the Minister (or another agency for that matter) making a decision that might be in the business’ interests merely due to the possibility of relevant information being disclosed.
The Ombudsman then turned to the consortium’s claims and said:
A particular adverse effect will flow from release of the information
33.     I am not able to specify the adverse effect particularised, as to do so would risk disclosing matter claimed exempt by the parties. Whilst regrettable, this may make my reasoning a little difficult to follow.
34.     This submission relates to information which has already been placed within the public domain by a particular entity. Several other entities have commented on the issue, and in my view the varying positions of the different parties are quite clear. If they are not, it is open to the relevant parties to make their positions clear. In a sense, the success of the consortium’s argument would require the public to reach a ‘wrong’ conclusion, and I am not satisfied either that the public would do this or, in a subjective sense, and where opinions may differ, could do this. For these reasons I am not satisfied that the disclosure of this information could reasonably be expected to have an adverse effect on the business affairs of the consortium (or its constituent members).
35.     In the event that this information could be expected to have an adverse effect on the business affairs of the consortium, I am not satisfied that disclosure of this information would, on balance, be contrary to the public interest.
36. There is strong public interest in the Minister’s decisions under the Development Act, and there is therefore a strong public interest in information underlying his decisions being disclosed. Decisions of this nature tend to impact a wide variety of people, significantly the people living in surrounding areas, and not just those involved in the negotiations. Disclosure of relevant information assists openness and accountability. Any countervailing public interest factors tending against disclosure will have to be weighed against this.
37. More particularly, and in the light of the importance of these decisions made under the Development Act, it is my view that there is significant public interest in the actual issue surrounding the particular information, and a corresponding public interest in knowing that the government is appropriately handling such issues. Accordingly, to the extent that this disclosure of this information could be expected to have an adverse effect on the business affairs of the consortium, I am not satisfied that this outweighs the overriding public interest in the release of the information.
Information relating to the purpose or results of research
38. Without disclosing the information said to constitute research by the consortium, I advise that I am not satisfied that this is the type of matter envisaged by clause 8 of Schedule 1 to the FOI Act. Whilst I agree that dictionary definitions can provide assistance where a term is not defined in legislation, I am of the view that the test proffered by the consortium is simply too wide, and lends itself more to any kind of ‘investigation’. I think a more academic or scientific flavour is envisaged by clause 8.
39.     In any event, even if this information did constitute research under clause 8, I would not be satisfied that its disclosure could easily be expected to have an adverse effect on the consortium or any other person, nor that it would be, on balance, contrary to the public interest. In my view it is not information which could be utilised by another party to the consortium’s detriment, and to the extent that issues may not have been finalised, the fact of this can be clarified. The public realise that not all things considered in negotiations will come to fruition, and the ability to consider ‘options’ is part and parcel with the openness and accountability of the final decision.
Further arguments regarding clause 9 and the public interest in general
40. I do not think it matters that the process under the Development Act has not yet been completed, and that information within the documents may not reflect a party’s final position or the Minister’s final decision as to whether or not to amend a plan. Openness and accountability does not only start when a final decision has been made. Releasing preliminary information does to preclude a party from altering or clarifying its position – false expectation can be allayed – and releasing information at an early stage may encourage other parties to provide their input. An integral notion behind the concept of public consultation is that the public will from time to time make a useful contribution.
41.     I have been referred to a general principal (sic) found in Howard and the Treasurer of the Commonwealth of Australia [1985] AATA 100 (Re Howard) – that, as a general principle, the disclosure of communications made in the course of the development and subsequent promulgation of policy tends not to be in the public interest. I am not satisfied that not any such principal (sic) has much to add to this external review. I question whether the Minister’s administrative decision regarding a DPA can be categorised as mere policy.
42.     I consider the assertion that, in the absence of any context, the public may misinterpret the information and its relationship with the process, to be paternalistic and unjustified. In any event, if the public is confused and asks questions, the questions can be answered.
A further reason for the need for confidence
43.     One of the reasons put forward for the need for confidence over consultations between the Minister and other parties regarding DPAs is because it is inevitable that there may be the need to be critical of the actions or inactions of third parties. I do not consider something becomes confidential merely because it constitutes criticism of another party. Moreover, where there is, in a general sense, a strong public interest in a decision likely to affect many people, I do not consider there to be a comparatively strong public interest in not disclosing a criticism made by one party about another. Rather, the party being criticised may have something to add to the matter and good decision making will be enhanced.
44. Furthermore, I am not necessarily satisfied that any such criticism would create a detriment to the relationship between the party making the criticism and the party being criticised or to the extent that it may, that such detriment should carry much weight. If a party to a process under the Development Act is a public entity, its decisions should be made with regard of the public interest and should continue to be so made in the future, irrespective of whether it has had cause to make a criticism or has been the recipient of criticism. If a party to a process under the Development Act is a private entity, I would suggest that it would continue to make decisions based upon its own interests irrespective of whether it has given or received criticism in the past.
The Ombudsman then proceeded to deal with submissions which had been put to him by Connor Holmes (paragraphs 45-48)[31] and then specifically addressed a submission put to him by the agency in relation to document 6.2 (paragraphs 49-51). The submissions made by Connor Holmes and the agency were not adopted or relied upon by the consortium in this appeal.
[31] See abridgement of those submissions attached to Ombudsman’s reasons for determination.
The Ombudsman concluded his reasons with the following remarks:
Recent events
52. Recent media reports have alerted my office to the fact that the draft DPA for the Mount Barker region has now been released for public consultation. This recent ‘turn of events’ has the potential, in my view, to negate or diminish the effect of some of the arguments put to me. Nevertheless, given the conclusions I have reached, it is not necessary to pursue this avenue.
53. In light of my reasoning above, I reverse the agency’s determination (as revised), pursuant to section 39(11) of the FOI Act. I do not consider the documents exempt under clauses 1, 7, 9, 13 or 14 of Schedule 1 to the FOI Act.
The Appeal

By Notice of Appeal filed on 22 July 2010 the consortium appealed against the Ombudsman’s determination on the following grounds:[32]
1. That the documents the subject of the external review were exempt documents pursuant to clauses 7, 8, 9, 13, or 14 of Schedule 1 of the Act and the Ombudsman erred in failing to so determine.
2. That the Ombudsman erred in reversing the Second Respondent’s original decision.
[32] A person aggrieved by a determination made on an external review has a right of appeal to the Administrative and Disciplinary Division of the District Court (s3 and s40(2)). The District Criminal Court Act 1991 governs the conduct and dispositions of appeals to the Administrative and Disciplinary Division. Pursuant to s42E(3) the Court must give due weight to the decision being appealed against and the reasons for it and not depart from the decision except for cogent reasons. The Court may affirm the decision appealed against, rescind the decision and substitute a decision the Court considers appropriate or remit matters to the original decision-maker for consideration or further consideration in accordance with any directions or recommendations of the Court (s42F).
The hearing of the appeal was conducted on 26 November 2010. The appeal papers did not contain the consortium’s written submissions to the Ombudsman. The hearing proceeded on the basis that the parties accepted that the abridged version of the consortium’s written submissions attached to the Ombudsman’s reasons for determination were sufficient for a proper consideration of the grounds of appeal.
Subsequent to the hearing of the appeal I formed the view that without seeing the consortium’s submissions in full it was not possible to properly assess the merits of the arguments presented by Mr Tredrea, counsel for the consortium, as to the adequacy of the Ombudsman’s reasons for determination. I asked to be supplied with those submissions at a directions hearing conducted on 23 August 2011. On 1 September 2011 Ms Jones filed a closed affidavit, to which the submissions were exhibited.
The first ground of appeal asserts that the relevant documents were exempt pursuant to five clauses in Schedule 1. It is clear that this ground of appeal is too wide because in the external review proceedings the consortium sought to rely on only three clauses, namely, 7(1)(c), 8 and 9. The written submissions filed by Mr Tredrea for this appeal also relied upon only clauses 7(1)(c), 8 and 9. In the course of Mr Tredrea’s oral submissions he further reduced the issues by indicating that the consortium no longer relied upon clause 8.
Mr Tredrea’s concession in relation to clause 8 is fatal to the consortium’s contention that the Ombudsman erred in finding that document 5 was not exempt. That is so because it is apparent from the consortium’s written submissions to the Ombudsman, and his reasons for determination, that the consortium’s claim in respect of document 5 was based solely on clause 8. This result may not have been intended because Mr Tredrea never expressly conceded that document 5 was not exempt. Nevertheless, that is the result which necessarily flows from the concession.
Consortium’s argument on appeal
Mr Tredrea emphasised that the Ombudsman’s reasons for rejecting the claims for exemption did not specifically identify any of the documents to which he was referring. Mr Tredrea submitted that the Ombudsman failed to analyse the information in each document and to determine whether it satisfied the test of exemption contained in the clause or clauses upon which the consortium relied. Accordingly, there was a complete failure on the part of the Ombudsman to exercise his jurisdiction under the FOIA: Htun v Minister for Immigration and Multicultural Affairs. [33]
[33] Htun v Minister for Immigrationand Multicultural Affairs (2001) 194 ALR 244.
In a nutshell Mr Tredrea submitted:
What it looks like the Ombudsman has done, to be fair, is he has considered all the documents collectively, made a generalised finding in respect to public interest and then decided ‘Because I make a finding, in relation to these documents, that it is not contrary to the public interest for them to be released, I will release them’.
Put another way, the Ombudsman failed to consider, in relation to clause 7(1)(c), whether disclosure of the information, contained in each of the documents 1, 2, 6.2, 7, 9 and 11, “could reasonably be expected to have an adverse effect” on either “the business, professional commercial or financial affairs of the agency or some other person” or “the future supply of such information to the government or to the agency” and “would, on balance, be contrary to the public interest”; and whether , in relation to clause 9(1), disclosure of the information, contained in each of the documents 1, 6.2, 7, 8, 9 and 11, “would, on balance, be contrary to the public interest”.
Mr Tredrea further submitted that the Ombudsman failed to appreciate that the each piece of information under review was preliminary to the preparation of the DPA by the Minister pursuant to s26(1) of the DA. He argued that disclosure of such preliminary information would not be in the public interest having regard to the principles expressed in Re Howard and Treasurer of the Commonwealth.[34]
[34] Re Howard and Treasurer of the Commonwealth (1985) 3 AAR 169.
Consideration of argument
An external review authority has a statutory obligation under the FOIA to provide reasons for its determination (s39(13)). Taking into account the limitations imposed by s39(15) the reasons must be sufficient to enable a court on appeal to see how the decision was reached. The failure to give sufficient reasons constitutes error of law.[35]
[35] Public Service Board (NSW) v Osmond (1986) 159 CLR 656; Pettitt v Dunkley [1971] 1 NSWLR 376; Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247; Papps v Police (2000) 77 SASR 210 and R v Keyte [2000] 78 SASR 68.
In the present matter the Ombudsman was, by virtue of s39(15), confronted with the difficult task of providing reasons that did not disclose matter claimed to be exempt. In the circumstances, it is understandable that his reasons might, as he remarked, be somewhat difficult to follow. Nevertheless, I am not satisfied, on the face of his reasons for determination, that he separately analysed each claim and considered whether it satisfied the limbs of the test(s) of exemption relied upon by the consortium, except in respect of the claims made under clause 7(1)(c) in relation to documents 1 and 2.
Documents 1 and 2: Clause 7(1)(c)
At the outset it is important to note that the consortium made the same claim under cl 7(1)(c) in relation to both documents 1 and 2; namely, that each document contained information relating to the consortium’s relationship with a third party whose professional probity had been impugned and that disclosure of the information would unfairly tarnish the consortium’s reputation and adversely effect its business.
Although the Ombudsman did not specifically say so, I am satisfied that the reasons which he set out under the heading “a particular adverse effect will flow from the release of information” (para.33-37) deal with the consortium’s claim under cl 7(1)(c) in respect of documents 1 and 2. In paragraph 34 the Ombudsman refers to the fact that the information was already in the public domain due to a “particular entity” and that the matter had been the subject of conflicting views. This was a reference to criticism directed at the third party in Parliament and perhaps also in public. That becomes clear when the Ombudsman’s remarks are considered in the context of the consortium’s unabridged written submissions of 14 August 2009 and 14 April 2010.
I am satisfied that the Ombudsman did not fail to properly consider the application of clause 7(1)(c) to documents 1 and 2. There is no dispute that documents 1 and 2 contain information concerning the business affairs of the consortium (cl 7(1)(c)(i)). In paragraph 34, the Ombudsman specifically had regard to, and rejected, the consortium’s submission that disclosure of the information could reasonably be expected to have an adverse effect on the business affairs of the consortium or its members (cl 7(1)(c)(ii)(A)) and, in paragraphs 35-37 (inclusive), concluded that even if the information could be expected to have an adverse effect on the consortium’s business affairs its disclosure would not, on balance, be contrary to the public interest (cl (1)(c)(ii)(B).
I am further satisfied that the Ombudsman did not err in finding that the information in documents 1 and 2 failed to satisfy the second and third limbs of test of exemption. As to the second limb, the Ombudsman correctly observed that the validity of the criticisms directed at the third party were the subject of debate and conflicting views. Furthermore, the criticism was directed at the third party and not the consortium. There was nothing, on the face of the evidence before the Ombudsman, to indicate that the consortium had anything other than a proper relationship with the third party. In those circumstances, the consortium’s contention that it could reasonably be expected that disclosure of the fact of its relationship with the third party would have an adverse effect on its business was tenuous.
As to the third limb, the consortium’s written submissions, asserted that disclosure would be contrary to the public because the information in question appears in communications made to the DPLG on the understanding that they would remain confidential. The Ombudsman did not specifically deal with this submission in paragraphs 36-37 but correctly stated in the course of his earlier “overarching” comments (paragraphs 24-31) that the provision of information to the government, on the understanding that it will remain confidential, is not a guarantee against disclosure under the FOIA: see Ipex Information Technology Group Pty Ltd v The Department of Information Technology Services South Australia.[36]
[36] Ipex Information Technology Group Pty Ltd v The Department of Information Technology Services South Australia (1997) 192 LSJS 54 transcript p.15.
Notwithstanding the consortium’s confidentiality point the Ombudsman found against the consortium because he considered that there is a strong public interest in Ministerial planning decisions made under the DA due to their impact on the community at large. He further stressed that the public has an interest in knowing that the government is appropriately handling such matters: see paragraphs 36-37. In my view, it was open to the Ombudsman to reject the Consortium’s public interest argument for the reasons he expressed. In reaching this conclusion, I have not overlooked Mr Tredrea’s contention that the Ombudsman failed to apply the principles expressed in Re Howard.[37] I will return to this decision when discussing the other claims.
[37] Re Howard and Treasurer of the Commonwealth (1985) 3AAR 169.
There is no need to elaborate on my reasons for finding that the Ombudsman did not err in rejecting the consortium’s claims under clause 7(1)(c), regarding documents 1 and 2. That is so because Mr Parnell has, since the institution of this appeal, obtained other documents under the FOIA containing the very information the consortium asserted was exempt. Indeed, the information concerning the consortium’s relationship with the third party obtained from those other documents has been the subject of recent discussion in Parliament.[38] The fact that the information is now in the public domain is fatal to this aspect of the consortium’s appeal. The appeal against the Ombudsman’s finding that documents 1 and 2 were not exempt under clause 7(1)(c) must be rejected.
[38] Hansard, Legislative Council, 27 September 2011 p3894.
Other claims under clause 7(1)(c): documents 6.2, 7, 8, 9 and 11
As I have said I am satisfied that paragraphs 33-37 of the Ombudsman’s reasons relate to the consortiums claim that documents 1 and 2 were exempt under clause 7(1)(c). Paragraphs 38-39 which appear under the heading “Information relating to the purpose or results of search” clearly relate to the consortium’s claim (now abandoned) that documents 1 and 5 were exempt under clause 8. The balance of the Ombudsman’s reasons (paragraphs 40-42-under the heading “Further arguments regarding clause 9 and the public interest in general” and paragraphs 43-44 under the heading “A further reason for the need for confidence”) fail to deal at all with the consortium’s claim that documents 6.2, 7, 9 and 11 are exempt under clause 7(1)(c).
The Ombudsman was obliged within the limitations imposed by s39(15) to provide reasons explaining his rejection of those claims. The failure to provide sufficient reasons constitutes error. The Ombudsman’s focus on the issue of public interest suggests that he may have formed the opinion that there was no need to deal with the consortium’s assertion that disclosure of the information contained in documents 6.2, 7, 9 and 11 could reasonably be expected to have an adverse effect on the business, professional commercial or financial affairs of the consortium because such disclosure would not, in event, be contrary to the public interest. Such an approach in itself would have involved error because, as earlier indicated, in determining whether disclosure would be contrary to the public interest it is relevant for the decision-maker to have regard to any specific adverse effect that such disclosure could reasonably be expected to cause.
Mr Tredrea submitted that if I were to uphold the appeal that I should remit the matter to the Ombudsman for reconsideration. Given the amount of time that has elapsed it is appropriate that I determine the remaining claims under clause 7(1)(c).
For the reasons set out below I reject the consortium’s claims.
Alleged adverse effect on consortium
I am prepared to accept that each of the documents contains matter consisting of information that either directly or indirectly concerns the business or commercial affairs of the consortium (cl 7(1)(c)(i)). However, I do not accept that the information could reasonably be expected to have an adverse effect on the consortium’s business or commercial affairs (cl 7(1)(c)(ii)).
I have read each document. As indicated by Ms Jones in her letter to the Ombudsman of 7 June 2010, each document contains information relating to one or more of the following matters: areas surrounding Mount Barker that would be affected by the proposed township expansion; suggested infrastructure installation and upgrades, proposed land use and related concept plans; performance indicators for the proposal; the number of potential residential allotments, available open space areas; predictions as to remaining years of land supply; and time tables governing the viability of the consortium’s proposal.
Ms Jones submitted:
[That] release of this information would have an adverse effect on the Consortium’s business affairs as it may cause unnecessary and misdirected public criticism of the consortium’s proposal before a Ministerial Development Plan is prepared and released for public consultation. To this end, I refer to my submissions concerning Documents 1, 2 and 5 contained in my letter of 14 April 2010 to support this position.
The letter of 14 April 2010 suggested that the consortium could be adversely affected if the rezoning proposal was released before the preparation of the Ministerial DPA because the consortium’s willingness to provide certain infrastructure “may not have not yet been finally decided or communicated to others”(p3). The letter fails to explain how those circumstances could adversely affect the consortium. However, in Ms Jones’ letter to Ms Nichols, dated 14 August 2009, it was submitted that early release of the information relating to the proposed infrastructure “may prejudice [the consortium’s] future dealings and/on going relationships with third parties, especially those who are not privy to the reasoning behind and context of the information contained in these documents” (p3).
These submissions made on behalf of the consortium are vague and unconvincing. They fail to explain how “unnecessary and misdirected public criticism” of the proposal could be expected to have an adverse effect on the consortium’s business affairs. The submissions also fail to explain why its dealings and relationships with “third parties” might be jeopardised. There is an onus on a party claiming exemption to clearly explain the grounds upon which the claim is made. An external review authority, and an appellate court, should not be required to guess about such matters.
I have assumed that the consortium’s concern about “unnecessary and misdirected” public criticism is that such criticism might cause the government to cool off on the rezoning proposal or result in the consortium’s business reputation being tarnished. Such arguments to do not impress me for they imply that the community lacks the intelligence to distinguish between a proposal considered as an option and one which has been approved. As the Ombudsman remarked, though possibly in a different context, the notion that the public might misinterpret information, unfairly prejudge the proposal and misunderstand the DPA process is “paternalistic and unjustified”. In any event, public misconceptions can be countered by the release of further appropriate information. Similarly, if the consortium was concerned that third parties, with whom it was dealing, might misunderstand its infrastructure proposals then it was open to the consortium to explain to those parties the reasons for the proposals.
Even if there was, at the time of the external review, substance in the consortium’s concerns that release of the information prior to the preparation of the Ministerial DPA might adversely affect its business there is now no basis for such concerns. That is so because the Minister approved the DPA on 10 December 2010. The applications for exemption under clause 7(1)(c) must be dismissed for this reason alone.
Public interest
In view of the above findings it is not necessary to consider the public interest limb in clause 7(1)(c). Nevertheless, I indicate, in relation to each document, that even disclosure could reasonably be expected to have an adverse effect on the consortium’s business affairs, I am not satisfied that disclosure would not, in my opinion, be contrary to the public interest.
The consortium’s written submissions of 7 June 2010 assert, in essence, that that disclosure would be contrary to the public interest on the following grounds: first, because the information contained in each document was communicated to the Minister on the understanding that it would remain confidential and, second by reason of the principles expressed in Re Howard.
In relation to the first argument, the provision of information on the understanding that it will remain confidential is, as earlier pointed out when discussing the consortium’s claim in relation to document 1, a relevant consideration but does not constitute a guarantee against disclosure. The written submissions of 7 June 2010 assert that disclosure of the information in the present case would damage the consortium’s relationship with the government and also result in the consortium and other private developers being reluctant to deal with government in the future and that such developments would be detrimental to the public interest.
I reject the consortium’s submission that its business relationship with the government would be damaged by disclosure. The information sought by Mr Parnell has not been, and will not be, released by the government. Indeed, his application under the FOIA for access to the documents was refused by the government’s agency (DPLG) and granted only after he applied to the Ombudsman for a review of that determination. Furthermore, approval of the DPA has been granted.

Nor do I accept that disclosure would compromise future dealings between the government and the consortium and other private developers. For the reasons already expressed there is no substance in the consortium’s claim that its business affairs will be adversely affected by disclosure. I do not believe that the consortium or other private developers are likely to be deterred from entering into substantial and lucrative ventures with the government due to the release of such information under the FOIA. The submission is commercially unrealistic. Moreover, as Paterson has observed, the significance of access to business information in ensuring the objective transparency inherent in freedom of information legislation has increased commensurately with the extent of commercialisation of government activities.[39]
[39] M. Paterson, Freedom of Information and Privacy in Australia, LexisNexis Butterworths, Australia, 2005, [6.56].
In relation to the second ground, Mr Tredrea emphasised that each piece of information under review was preliminary to the preparation of the DPA by the Minister and its release for public consultation, in about September 2010, pursuant to s26 of the DA. As earlier noted the DPA was ultimately approved on 10 December 2010. He argued that disclosure of such preliminary information would be contrary to the public interest having regard to the principles expressed in Re Howard.[40]
[40] Re Howard and Treasurer of the Commonwealth (1985) 3 AAR 169.
In that case the applicant sought to review a refusal of access under the FOIA (Cth) to documents provided to the ACTU including a minute to the Treasurer and attachments to minutes to the Treasurer. Davies P held that the documents fell within s36(1)(a) and that there were reasonable grounds for concluding that disclosure would be contrary to the public interest. He identified the following factors as relevant to the public interest test:[41]
1:The higher the office of the persons between whom the communications pass and the more sensitive the issues involved in the communication, the more likely it will be that the communication should not be disclosed.
2: Disclosure of communications made in the course of the development and subsequent promulgation of policy tends not to be in the public interest.
3:Disclosure which will inhibit frankness and candour in future predecisional communications is likely to be contrary to the public interest.
4:Disclosure, which will lead to confusion and unnecessary debate resulting from disclosure of possibilities considered, tends not to be in the public interest.
5:Disclosure of documents which do not fairly disclose the reasons for a decision subsequently taken may be unfair to a decision-maker and may prejudice the integrity of the decision-making process.
[41] Re Howard and Treasurer of the Commonwealth (1985) 3 AAR 169 at 178.
At the outset, it must be remembered that the factors postulated by Davies P are not principles set in stone. As his Honour remarked “in each case the whole of the circumstances must be examined including any public benefit perceived in the disclosure of the documents sought”.[42] It should also be observed that the ‘Howard factors’ have been extensively criticised on the basis that unless treated with caution they may permit the introduction of class-based claims for exemption which fail to adequately consider the content of documents and the reasons why their disclosure would be contrary to the public interest. Other cases favour a more flexible approach focussing on the decision-making context in which the claim is made.[43]
[42] Re Howard and Treasurer of the Commonwealth (1985) 3 AAR 169 at 178.
[43] See M. Paterson, Freedom of Information and Privacy in Australia, LexisNexis Butterworths, Australia, 2005, [7.12]-[7.22] and the cases discussed therein.
In any event, I do not accept that a proper application of the ‘Howard factors’ warrants a finding that the documents in issue are exempt.
In relation to the first factor the documents relate to communications between the Minister and others. However, the FOIA applies to information contained in documents given to or held by ministers as well as other government agencies. The objects of the FOIA are intended to promote, inter alia, “openness in government and accountability of Ministers of the Crown” and to facilitate “more effective participation by members of the public in the processes involved in the making and administration of laws and policies” (s3). The mere fact that communications involve the Minister does not provide a basis for exemption.[44]
[44] Re Rae and Department of Prime Minister and Cabinet (1986) 12 ALD 589 at 603.
In relation to the second factor I do not believe that the documents were “made in the course of the development and subsequent promulgation of policy”. The documents comprise a map of the Mount Barker area (document 6.2) and three letters from a third party to the Minister discussing the merits of the proposal (documents 7, 9 and 11). There is no evidence that at the time of the relevant communications in 2008 a ministerial policy had been formulated or was in the process of being developed by the Minister in relation to rezoning Mount Barker. Investigations for the purpose of preparing the DPA did not commence until May 2009 (see document 3) and the DPA was not prepared and released for public consideration until 2010. Even if I am wrong they are certainly not documents concerning matters of high policy.
The third factor provides that “disclosure which will inhibit frankness and candour in future pre-decisional communications is likely to be contrary to the public interest”. This has been described as the most controversial of the ‘Howard factors’ because it tends to run counter to the rejection of class based claims by the courts.[45] In any event such claims must be supported by “clear, specific and credible evidence” that the documents in issue will have the effect claimed.[46] In the present case there is no evidence from which it can be clearly inferred that disclosure of the documents would inhibit frank and candid pre-decisional discussions between government and developers in the future. To my mind it is unrealistic to think, as I have already remarked, that disclosure of the documents in issue in the present case would deter private developers from becoming involved with the government in profitable projects.
[45] See R Snell ‘The Ballad of Frank and Candour: Trying to Shake the Secrecy Blues From the Heart of Government’ (1995) 57 Freedom of Information Review 34; M. Paterson, Freedom of Information and Privacy in Australia, LexisNexis Butterworths, Australia, 2005 [7.15] and the cases discussed therein.
[46] Bennett v Vice Chancellor, University of New South Wales [2000] NSWADT 8 at [63]e.
I turn to the fourth factor that “disclosure, which will lead to confusion and unnecessary debate resulting from disclosure of possibilities considered, tends not to be in the public interest”. I do not believe that at the time of the external review disclosure of the information in the documents would necessarily have resulted in confusion or ill informed debate about the proposed rezoning. As I earlier remarked the risk of public misunderstanding can be countered by the release of further appropriate information. Furthermore, whatever may have been the position at the time of the external review, there is now no risk of ill informed debate because the DPA has been approved.
In relation to the fifth factor there is no evidence that the documents that Mr Parnell seeks “do not fairly disclosure the reasons for a decision subsequently taken [approval of the DPA] may be unfair to a decision-maker and may prejudice the integrity of the decision-making process”.
I do not accept, having regard to the content of the documents in issue and the public interest in disclosure, that disclosure should not be allowed due to the pre-decisional nature of the documents. The public has an interest in knowing that government is properly handling matters of this nature at all stages. The consortium’s submissions have failed to satisfy me that it would be contrary to the public interest to permit disclosure having regard to the ‘Howard factors’.
Claims under clause 9: documents 1, 6.2 ,7 ,8, 9 and 11
There is no dispute that each of these documents contain matter that either directly or indirectly relates to “opinion, advice or recommendations” obtained, prepared or recorded in the course of, or for the purpose of the decision making functions of the Minister (clause 9(1)(a)). The consortium’s contention that disclosure of each document would, on balance, be contrary to the public interest (clause 9(1)(b)) is the same public interest argument presented in support of its claims for exemption under cl 7(1)(c)(ii) and must fail for the reasons I have already given. Document 8 (minute to the Minister dated 8 October 2008) is the only document for which exemption is claimed under clause 9 which was not the subject of a claim under cl 7(1)(c). There is nothing about the content of that document or the circumstances in which it was created that would warrant a different finding.
Orders
1The appeal is refused.
2I will hear the parties as to costs.