Duncan v Independent Commission Against Corruption - [2014] NSWSC 1018

Supreme Court

New South Wales

Summary available

Medium Neutral Citation: Duncan v ICAC McGuigan v ICAC Kinghorn v ICAC Cascade Coal v ICAC [2014] NSWSC 1018
Hearing dates: 23/06/2014, 24/06/2014 and 25/06/2014
Decision date: 29 July 2014
Jurisdiction: Common Law - Administrative Law
Before: McDougall J
Decision:
In proceedings 2013/249678: order that the further amended summons be dismissed. In proceedings 2013/325031: order that the amended summons be dismissed with costs. In proceedings 2013/326066: (a) declare that the determination by the defendant, in the report entitled "investigation into the conduct into Ian Macdonald, Edward Obeid Snr, Moses Obeid and others" dated July 2013, that the plaintiff had engaged in corrupt conduct within the meaning of the Independent Commission Against Corruption Act 1988 (NSW) was not made according to law and is a nullity. (b) order the defendant to pay the plaintiff's costs. In proceedings 2014/13155: order that the summons be dismissed with costs.

Catchwords:
ADMINISTRATIVE LAW - judicial review - Independent Commission Against Corruption - appeal against finding of corrupt conduct under s 8 of the Independent Commission Against Corruption Act 1988 (NSW) - whether conduct could "adversely affect" the exercise of "official functions" by "public officials" - meaning of the expression "official functions" - meaning of the term "could" - degree of probability or certainty required for conduct to fall into category of conduct which "could" adversely affect the exercise of official functions - whether it is necessary to identify the public officials or authorities and the official functions in order to determine whether those functions could be adversely affected by the conduct - whether an official function identified by the Commission was actually a function that the Minister could exercise - Whether conduct would actually have had an adverse effect on the exercise of official functions - whether non-disclosure of information could have adversely affected official function of granting a mining lease - application of the Independent Commission Against Corruption Act 1988 (NSW), s 8.

ADMINISTRATIVE LAW - judicial review - Independent Commission Against Corruption - whether findings of corrupt conduct made by the Independent Commission Against Corruption in relation to three issues or categories can be separated - whether each separate issue or category which is part of the finding of corrupt conduct must have been proved for the finding of corrupt conduct to stand

ADMINISTRATIVE LAW - judicial review - Independent Commission Against Corruption - appeal against finding of corrupt conduct on ground that s 9 of the Independent Commission Against Corruption Act 1988 (NSW) not satisfied - criminality of corrupt conduct -whether plaintiffs had gained any financial advantage from alleged corrupt conduct - whether obligations on directors requires them to do any positive act, including a duty of proactive disclosure - whether prevention of loss in value of shares is a financial advantage - whether removal or reduction of risk to Company is a financial advantage - whether information already in the public arena need not be disclosed - whether in breach of s 184(1) Corporations…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2014] NSWSC 1018
Decision Date: 29 July 2014

CaseChat Overview and Summary

The matter of Duncan v Independent Commission Against Corruption involved an appeal against the findings of the Independent Commission Against Corruption (ICAC) of New South Wales regarding the conduct of the appellants. The appellants, who were directors of a company, challenged the findings of corrupt conduct made against them under section 8 of the Independent Commission Against Corruption Act 1988 (NSW). The issues at the heart of the dispute included the interpretation of terms such as "official functions" and "could" within the Act, the necessity of identifying specific public officials or authorities and their functions, and the degree of probability required for conduct to adversely affect those functions. The appellants also contested the criminality of their conduct under section 9(1)(a) of the Act, questioning whether they had gained any financial advantage. Furthermore, they argued that there had been a denial of natural justice due to a lack of notice and cross-examination on specific elements of the alleged corrupt conduct. Finally, the appellants challenged the sufficiency of the evidence supporting the findings of corrupt conduct and sought declarations that ICAC's recommendations were nullities.

The court needed to determine whether the appellants' conduct could adversely affect the exercise of official functions by public officials, the meaning of "official functions," and the requisite degree of probability for such conduct. Additionally, the court had to consider whether it was necessary to identify specific public officials and functions to ascertain if they could be adversely affected by the conduct. The court also needed to examine whether certain functions identified by ICAC were indeed functions that the Minister could exercise and whether the conduct would have actually had an adverse effect on those functions. Regarding the criminality of the conduct, the court had to decide whether the appellants had gained any financial advantage, including the prevention of loss in value of shares or the reduction of risk to the company. The court further had to assess whether the appellants were under any obligation to proactively disclose information already in the public domain and whether the failure to do so constituted a breach of section 184(1) of the Corporations Act 2001 (Cth). The appellants also claimed that they were denied natural justice due to a lack of notice and cross-examination on the elements of the alleged offences. Finally, the court had to evaluate whether the findings of corrupt conduct were supported by sufficient evidence.

In its decision, the court held that the appellants' conduct could adversely affect the exercise of official functions by public officials, provided that the functions were identified and the requisite degree of probability was met. The court clarified the meaning of "official functions" and noted that the term "could" did not require a high degree of certainty but rather a reasonable possibility. The court found that it was necessary to identify specific public officials and their functions to determine whether they could be adversely affected by the conduct. The court held that certain functions identified by ICAC were indeed functions that the Minister could exercise. However, the court found that the appellants' conduct would not have actually had an adverse effect on those functions. Regarding the criminality of the conduct, the court held that the appellants had not gained any financial advantage, as the prevention of loss in value of shares or the reduction of risk to the company did not constitute a financial advantage under section 9(1)(a) of the Act. The court also found that the appellants were not under any obligation to proactively disclose information already in the public domain. The court held that there was no denial of natural justice as the appellants had received written submissions identifying the alleged criminality before the end of the ICAC hearing. Finally, the court found that the findings of corrupt conduct were supported by sufficient evidence.

The court granted the appellants' application for declaratory relief, declaring that ICAC's recommendations were nullities. The court held that the findings of corrupt conduct were not amenable to review, and other claims had failed. The court also found that there was no utility in granting the relief sought by the appellants. The court ordered that the costs of the appeal follow the event.

Orders