Duncan v IPP - [2013] NSWCA 189

Court of Appeal

Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: Duncan v Ipp [2013] NSWCA 189
Hearing dates: 8 May 2013
Decision date: 25 June 2013
Before: Bathurst CJ at [1]; Barrett JA at [217]; Ward JA at [220]
Decision:
1. Leave to appeal granted
2. Appeal dismissed with costs
[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

Catchwords:
ADMINISTRATIVE LAW - apprehended bias - pre-judgment - Independent Commission Against Corruption (ICAC) - conduct of the Commissioner of the ICAC.

ADMINISTRATIVE LAW - apprehended bias - pre-judgment - conduct of the ICAC Commissioner - test for reasonable apprehension of bias - application of test to investigatory body - scope of Independent Commission Against Corruption Act 1988.

ADMINISTRATIVE LAW - apprehended bias - pre-judgment - conduct of the ICAC Commissioner - test for apprehended bias - Ebner v Official Trustee in Bankruptcy [2000] HCA 63; (2000) 205 CLR 337 - whether there was a logical connection between the conduct of the Commissioner and the alleged apprehended bias.
ADMINISTRATIVE LAW - apprehended bias - pre-judgment - conduct of the ICAC Commissioner - whether contact between the Commissioner, the Executive and Government Departments, advice provided by the Commissioner and the circumstances of providing such advice either separately or holistically established apprehended bias.
Legislation Cited: Environmental Planning and Assessment Act 1979 Pt 3A, s 75V
Independent Commission Against Corruption Act 1988, s 2A, s 10, s 12, s 13, s 14, s 16, s 17, s 20, s 30, s 31, s 53, s 73, s 74, s 111, Schedule 1
Cases Cited: Antoun v The Queen [2006] HCA 2; (2006) 80 ALJR 497
Concrete Pty Ltd v Parramatta Design & Developments Pty Ltd [2006] HCA 55; (2006) 229 CLR 577
Ebner v Official Trustee in Bankruptcy [2000] HCA 63; (2000) 205 CLR 337
Hot Holdings Pty Ltd v Creasy [2002] HCA 51; (2002) 210 CLR 438
Johnson v Johnson [2000] HCA 48; (2000) 201 CLR 488
Livesey v NSW Bar Association [1983] HCA 17; (1983) 151 CLR 288
McGovern v Ku-ring-gai Council [2008] NSWCA 209; (2008) 72 NSWLR 504
Michael Wilson & Partners Ltd v Nicholls [2011] HCA 48; (2011) 244 CLR 427
Minister for Immigration and Multicultural Affairs; Ex parte Epeabaka [2001] HCA 23; (2001) 206 CLR 128
Minister for Immigration and Multicultural Affairs v Jia Legeng [2001] HCA 17; (2001) 205 CLR 507
R v Commonwealth Conciliation and Arbitration Commission; Ex parte Angliss Group (1969) 122 CLR 546
R v Lusink; Ex parte Shaw (1980) 32 ALR 47
Vakauta v Kelly [1989] HCA 44; (1989) 167 CLR 568
Category: Principal judgment
Parties: Travers William Duncan (applicant)The Honourable David Andrew Ipp AO QC (first respondent)Independent Commission Against Corruption (second respondent)Attorney General of NSW (third respondent)
Representation: Counsel:
N Hutley SC and G Ng (applicant)Submitting Appearance (first and second respondents)B Walker SC and S Free (third respondent)
Solicitors:
Yeldham Price O'Brien Lusk (applicant)I V Knight, Crown Solicitor (NSW) (first, second and third respondents)

File Number(s): 2013/111103
Publication restriction: No
Decision under appeal

Jurisdiction:

9111

Citation:

[2013] NSWSC 314

Date of Decision:

2013-04-10 00:00:00

Before:

Hoeben CJ at CL

File Number(s):

2013/68363

HEADNOTE

[This headnote is not to be read as part of the judgment]

In November 2011 both Houses of the Parliament of New South Wales passed resolutions requesting the Independent Commission Against Corruption (ICAC) inquire into circumstances surrounding the allocation of an exploration licence.

The ICAC announced in August 2012 that it would hold a public inquiry as part of three investigations into alleged corruption. Relevantly, the public inquiry was to examine the circumstances surrounding the award of an exploration licence in respect of an area known as Mount Penny. The applicant is a shareholder in a company whose wholly owned subsidiary was awarded the Mount Penny licence.

In 2010 the licence holder had made an application under the Environmental Planning and Assessment Act 1979 seeking approval for a planned mine at Mount Penny. Following the announcement of the ICAC inquiry, advice was sought in relation to the effect the inquiry would have on the approval of the development application.

In January and February 2013 a series of communications took place between the Commissioner, the solicitor for the ICAC, the Premier and senior public servants regarding the effect of the inquiry on the approval process. In particular, the Commissioner provided verbal and written advice advising that evidence adduced before the ICAC could be taken into account in the approval process.

On 6 March 2013 the applicant sought orders restraining the Commissioner from further presiding over the investigation. The applicant also sought to restrain the Commissioner and the ICAC from preparing a report regarding the investigation.

The applicant contended that a fair-minded and informed observer might reasonably apprehend that the Commissioner might have failed to bring an impartial and unprejudiced mind to the matters under investigation. The applicant relied on five areas of the Commissioner's conduct which, considered both separately and together, were said to found a reasonable apprehension of bias, on the basis of pre-judgment.

On 10 April 2013 the primary judge dismissed the applicant's summons.

The issues for determination on appeal were whether the primary judge:

(i) correctly applied the test for apprehended bias;

(ii) erred in considering whether the circumstances surrounding the letter from the Premier to the Commissioner of 30 January 2013 might give rise to a reasonable apprehension of bias in the mind of a fair-minded observer;

(iii) erred in considering whether the Commissioner's advice to the Director General of the Department of Premier and Cabinet and the Premier might give rise to a reasonable apprehension of bias in the mind of a fair-minded observer;

(iv) erred in considering whether certain statements by the Commissioner in the course of the inquiry might give rise to a reasonable apprehension of bias in the mind of a fair-minded observer;

(v) erred in considering whether the Commissioner's letter of advice to the Premier of 20 February 2013 might give rise to a reasonable apprehension of bias in the mind of a fair-minded observer;

(vi) erred in determining how the Commissioner's denials of having made factual findings should be considered when assessing if conduct might give rise to a reasonable apprehension of bias in the mind of a fair-minded observer; and

(vii) erred in considering whether a fair-minded observer might reasonably apprehend the Commissioner might have failed to bring an impartial and unprejudiced mind having regard to the totality of the facts.

The Court held, granting leave to appeal but dismissing the appeal:

In relation to (i):

1. The test for apprehended bias does not require an inevitable conclusion to be drawn. It is framed at all stages at the level of possibility, requiring that a fair-minded observer might perceive a logical connection between the matters raised and the possibility that the decision-maker did not bring an impartial mind to the issue: [147]-[148] (Bathurst CJ); [222] (Ward JA).

Ebner v Official Trustee in Bankruptcy [2000] HCA 63; (2000) 205 CLR 337 considered. R v Lusink; Ex parte Shaw (1980) 32 ALR 47; R v Commonwealth Conciliation and Arbitration Commission; Ex parte Angliss Group (1969) 122 CLR 546 applied.

2. It is not inappropriate to consider the possible reasons why the decision-maker took a particular course. This may assist in determining whether the logical connection is made out. However, the fact that there are alternative possibilities does not mean that a fair-minded observer might not conclude that what occurred nonetheless showed the possibility of bias: [149]-[150] (Bathurst CJ).

Ebner v Official Trustee in Bankruptcy [2000] HCA 63; (2000) 205 CLR 337 considered.

3. The fact that a body carrying out non-judicial functions has expressed tentative views on an issue in question would not, of itself, give rise to the possibility of bias in the mind of a fair-minded observer: [151] (Bathurst CJ); [217] Barrett JA; [228] (Ward JA).

Vakauta v Kelly [1989] HCA 44; (1989) 167 CLR 568; Johnson v Johnson [2000] HCA 48; (2000) 201 CLR 488; Antoun v The Queen [2006] HCA 2; (2006) 80 ALJR 497; Concrete Pty Ltd v Parramatta Design & Developments Pty Ltd [2006] HCA 55; (2006) 229 CLR 577 referred to. R v Commonwealth Conciliation and Arbitration Commission; Ex parte Angliss Group (1969) 122 CLR 546 applied.

4. A fair-minded observer, while not having detailed knowledge of the Independent Commission Against Corruption Act 1988, would at least be aware that the Commissioner may from time to time form tentative views and, further, would have no expectation that all communications between the ICAC and public officers would be disclosed: [152]-[156] (Bathurst CJ).

McGovern v Ku-ring-gai Council [2008] NSWCA 209; (2008) 72 NSWLR 504; Minister for Immigration and Multicultural Affairs v Jia Legeng [2001] HCA 17; (2001) 205 CLR 507; Minister for Immigration and Multicultural Affairs; Ex parte Epeabaka [2001] HCA 23; (2001) 206 CLR 128; R v Commonwealth Conciliation and Arbitration Commission; Ex parte Angliss Group (1969) 122 CLR 546 applied.

In relation to (ii)-(v):

5. There was no logical connection between the alleged conduct - being the circumstances surrounding the Premier's letter; the Commissioner's advice to the Director General of the Department of Premier and Cabinet of 31 January 2013; the Commissioner's failure to disclose his previous communications with the Department and the Executive in the context of calling for submissions regarding his proposed response to the Premier's letter; and, the Commissioner's letter of advice to the Premier - and the possibility that the Commissioner might have had a closed mind as to whether corrupt conduct had occurred: [167]-[169], [182]-[183], [197]-[200], [205] (Bathurst CJ); [217] (Barrett JA); [227], [230] (Ward JA).

6. Speculation in relation to the reasons for the Commissioner requesting the Premier's letter detract from the real issue of whether there is a logical connection between the Commissioner's conduct and the possibility of pre-judgment in the mind of a fair minded observer: [170] (Bathurst CJ); [219] (Barrett JA).

7. If the Commissioner formed the view that there was a possibility that a licence might be obtained as a result of corrupt conduct and that it was in the public interest that evidence before the ICAC should be taken into account, advice to the Minister to that effect would not lead to a reasonable possibility of a fair-minded observer with knowledge of the ICAC concluding that the Commissioner might have a closed mind as to whether the corrupt conduct existed: [159]-[161] (Bathurst CJ); [218] (Barrett JA); [228] (Ward JA).

8. Having regard to the advisory function of the ICAC, it was appropriate for the Commissioner to have expressed a view that public interest considerations, including material before the ICAC, might be taken into account in determining a development application: [206] (Bathurst CJ); [218] (Barrett JA).

In relation to (vi):

9. A fair-minded observer would take into account statements by a decision-maker as to their state of mind. Such statements may not be determinative but are relevant: [210] (Bathurst CJ).

In relation to (vii):

10. At most, a fair-minded observer might conclude from the totality of the facts that the Commissioner had formed a view as to what should be taken into account in considering the development application: [214] (Bathurst CJ).

Judgment

BATHURST CJ: This is an application for leave to appeal from a judgment of the Chief Judge at Common Law (the primary judge) in which his Honour dismissed a summons brought by the applicant. The applicant sought orders that the first respondent (the Commissioner) be restrained from further presiding over or participating in an investigation styled "Operation Jasper". In addition, the summons sought that both the Commissioner and the second respondent (the Commission) be restrained from presenting any report to Parliament in respect of that investigation.

The Court ordered that the application for leave and the appeal be heard concurrently.

Before this Court and in the Court below, both the Commissioner and the Commission filed submitting appearances. In these circumstances, leave was granted for the third respondent (the Attorney) to be joined in the proceedings to fulfil the role of contradictor.

The claim for relief in the summons was based on the contention that a fair-minded and informed observer might reasonably apprehend that the Commissioner might have formed a closed mind as to whether the exploration licence the subject of the inquiry was procured by corruption involving the then Minister for Mineral Resources (Minister for Mines) and, further, that the applicant and his associates benefited from such corrupt conduct.

Leave to appeal

In his written submissions filed in respect of the application, the Attorney opposed the grant of leave. Unsurprisingly, this submission was not developed any further at the hearing. The matters raised are of general public importance and it is appropriate that leave be granted.

Background

There was no real dispute as to the factual background leading up to the summons the subject of this application.

On 11 November 2011, a resolution was passed by the Legislative Assembly of NSW that:

"1. Pursuant to section 73 of the Independent Commission Against Corruption Act 1988, this House request the Independent Commission Against Corruption (ICAC) to inquire into and report with respect to:

(a) The circumstances surrounding the application for and allocation to Doyles Creek Mining Pty Ltd of Exploration Licence No 7270 under the Mining Act 1992 (NSW) (Mining Act);

(b) The circumstances surrounding the making of profits, if any, by the shareholders of NuCoal Resources NL as proprietors of Doyles Creek Mining Pty Ltd;

(c) Any recommended action by the New South Wales Government with respect to licences or leases under the Mining Act over the Doyles Creek area;

(d) Any recommended action by the New South Wales Government with respect to amendment of the Mining Act; and

(e) Whether the New South Wales Government should commence legal proceedings, or take any other action, against any individual or company in relation to the circumstances surrounding the allocation of Exploration Licence No 7270.

2. As deemed necessary, the Commissioner may also inquire into any related matters.

3. A message be sent to the Legislative Council informing it that the Legislative Assembly has this day agreed to the resolution and, pursuant to s73 of the Independent Commission Against Corruption Act 1988, requests the Legislative Council to pass a similar resolution."

On 23 November 2011, the Legislative Council passed a resolution in similar (and in substance the same) terms as the resolution passed by the Legislative Assembly on 11 November 2011.

These resolutions did not extend to the investigation which became known as Operation Jasper. However, on 7 August 2012 the Commission announced it would hold a public inquiry as part of an investigation it was then conducting concerning corruption allegations. The announcement so far as is relevant was in the following terms:

"The Independent Commission Against Corruption (ICAC) will hold a public inquiry commencing Thursday 1 November as part of three investigations (Operations Jasper, Acacia and Indus) it is conducting concerning corruption allegations involving the former NSW Minister for Primary Industries and Mineral Resources, the Hon Ian Macdonald MLC, former Member of Parliament, the Hon Edward Obeid MLC, and former NSW Minister for Roads and for Commerce, the Hon Eric Roozendaal MLC.

Last Friday, the ICAC began serving summonses to witnesses to appear and give evidence at the public inquiry. Operation Jasper will examine the circumstances surrounding a decision made in 2008 by Mr Macdonald to open a mining area in the Bylong Valley for coal exploration, including whether the decision was influenced by Edward Obeid. It will also explore the circumstances under which the Department of Primary Industries, in around September 2008, called for expressions of interest for the awarding of exploration licences for the coal mining areas known as Mount Penny, Glendon Brook and Yarrawa, and whether confidential information about the expression of interest process was provided to, and used by, Edward Obeid, members of his family and associates.

Further, Operation Jasper will examine: the circumstances surrounding the decision by the Department of Primary Industries in November 2008 to re-open the expression of interest process for the awarding of exploration licences areas and extend further invitations to additional mining companies including Cascade Coal Pty Ltd; the circumstances in which exploration licences were awarded for Mount Penny (EL 7406) and Glendon Brook (EL 7405); whether confidential information relating to the expression of interest process for Mount Penny (EL 7406) and Glendon Brook (EL 7405) was provided to, and used by, persons associated with Cascade Coal Pty Ltd; and the circumstances in which Monaro Coal Pty Ltd was awarded an exploration licence for Yarrawa (EL 7430), and how it has dealt with that exploration licence."

The announcement stated the inquiry would be presided over by the Commissioner and was expected to continue until at least April 2013.

The issue in the present proceedings concerns the inquiry in so far as it relates to the award of the exploration licence in respect of Mount Penny (EL 7406) in favour of Mt Penny Coal Pty Ltd, a wholly-owned subsidiary of Cascade Coal Pty Ltd (the subsidiary). The applicant is a shareholder in Cascade Coal Pty Ltd (Cascade Coal). There is no issue that the Commission had power to hold the public inquiry.

The exploration licence in respect of Mount Penny was granted in June 2009. On 16 December 2010, the subsidiary made an application under the then Pt 3A of the Environmental Planning and Assessment Act 1979 (the EPA Act) for project approval for an open cut mine at Mount Penny. Under the EPA Act, the Minister for Planning and Infrastructure (the Planning Minister) was responsible for project approval. The EPA Act as it then stood provided that a mining lease could not be refused if it was necessary for carrying out a project approved under Part 3A: s 75V(1)(c). It was common ground that notwithstanding the repeal of the then Pt 3A, s 75V(1)(c) continues to apply by virtue of the transitional provisions.

Following the announcement of Project Jasper, the Department of Planning and Infrastructure sought urgent advice from the Crown Solicitor's Office and senior counsel as to the effect the public inquiry would have on approval of the development application. As a consequence of such advice, on 25 October 2012 the Planning Minister made the following statement in the Legislative Assembly:

"...Having in mind that this application is on foot concurrently with the Independent Commission Against Corruption inquiry, it seems to me that a reasonable individual would ponder why the Government is allowing this application to proceed. Let me make it clear that, as planning Minister, I have explored whether it is legally possible to suspend or terminate the current Cascade Coal application. Accordingly, I requested and received Crown Solicitor's advice. I also obtained counsel's opinion. Whilst it is not appropriate to disclose the full details of those advices, I can tell the House that counsel advised that:

'As a matter of planning law, any grant of rights in relation to the project ... is a grant in rem attaching to the land, but is not a grant of rights in personam, given to a particular person.'

That is, a development application attaches to the land and not to the individual applicant. Furthermore, counsel's opinion stated:

'How or why a person came to become the owner of land or the proponent for development is not necessarily a relevant consideration within the scheme of the Act.'

That is, although the application may have come into existence as a result of corrupt practices, that corruption does not stop or necessarily taint the development application process. Furthermore, if the application proceeds, it must be dealt with as all applications are dealt with, irrespective of the origin of the original entitlement to bring the application. That is, the application must be dealt with on merit. Hence, in my opinion, a decision by me or by the Department of Planning and Infrastructure to forcibly defer the assessment of the application or to terminate the assessment would provide potential grounds for the applicant to appeal in the Land and Environment Court. A decision adverse to the Government's application in the Land and Environment Court would also run the risk of a court order for costs being made against the Government."

On 12 November 2012 the public inquiry with respect to Operation Jasper commenced. The scope of the public inquiry relating to the Mount Penny exploration licence was set out so far as is relevant in the following terms:

"5. The circumstances surrounding the decision by the Department of Primary Industries in November 2008 to re-open the expression of interest process for the awarding of exploration licence areas and to extend further invitations to additional mining companies including Cascade Coal Pty Ltd, and Mr MacDonald's role in these decisions.

6. The circumstances in which Exploration Licences were awarded in respect of Mount Penny (EL 7406), Yarrawa (EL 7430) and Glendon Brook (EL 7405) and how the holders of those licences have dealt with them.

7. The actual and potential financial benefits of the award of the Mount Penny and Yarrawa tenements to those parties who have or have had a direct or indirect interest in those tenements, whether by way of a holding of shares or as a trust beneficiary or otherwise.

8. Without detracting from the generality of paragraph 7, the actual and potential financial benefit to Cascade Coal Pty Limited and investors in that company including Travers Duncan, Brian Flannery, John Kinghorn, John McGuigan, John Atkinson, Greg Jones and Richard Poole, of the award of the Mount Penny tenement to Cascade Coal Pty Ltd.

...

10. Whether Mr MacDonald, or any member of his personal staff, or any employee of the Department of Primary Industries (whether instructed to do so by Mr Macdonald or otherwise), in breach of their duties, provided confidential information relating to the expression of interest process in respect of the Mount Penny and Yarrawa tenements to members of the Obeid family or persons associated with Cascade Coal Pty Ltd.

...

15. Whether Mr Macdonald received or expected to receive a financial benefit from any member of the Obeid family, or persons associated with Cascade Coal Pty Ltd, for any act or omission on his part in connection with the creation of the Mt Penny and Yarrawa tenements, or the expression of interest process relating to those tenements, or the award of those tenements, or in connection with the reopening of the expression of interest process in November 2008 relating to those tenements.

16. Whether any improper motive caused Mr Macdonald to take steps or refrain from taking steps to advance the creation of the Mt Penny and Yarrawa tenements, or in regard to the expression of interest process relating to those tenements, or in connection with the reopening of the expression of interest process in November 2008, or whether he received any corrupt benefit for any of the aforegoing.

17. Whether Cascade Coal Pty Ltd, Messrs Duncan, Flannery, Kinghorn, John McGuigan, Atkinson, Jones and Poole attempted to mislead the NSW Government by concealing the involvement of members of the Obeid family in the acquisition of and dealings concerning the Mount Penny tenement."

The public inquiry heard evidence up to 14 December 2012 when it was adjourned to 21 January 2013. At the time of the adjournment 58 of the proposed 83 witnesses to be called had given evidence. This included the applicant and all but two of the investors in Cascade Coal.

On or shortly prior to 15 January 2013, a meeting took place between the Commissioner and Mr Chris Eccles, the Director General of the Department of Premier and Cabinet. A briefing note to the Premier dated 15 January 2013 recorded the substance of the meeting as follows:

"1. Subject: ICAC Investigations into Mining Exploration Licences - Operations Jasper and Acacia

2. Purpose / Recommendation

2.1 To indicate formally to the ICAC that the Government would welcome, in due course, recommendations from the ICAC as to what action the NSW Government should appropriately take with respect to any licences or leases that are the subject of the ICAC's investigations.

3. Key Points

3.1 The ICAC is currently investigating matters concerning various mining exploration licences and leases in the Hunter Valley.

3.2 Of those matters, one (Doyles Creek) was specifically referred to the ICAC by a Parliamentary resolution under section 73 of the ICAC Act. In the resolution, Parliament expressly requested that the ICAC report on:

'(c) any recommended action by the New South Wales Government with respect to licences or leases under the Mining Act;

(d) any recommended action by the New South Wales Government with respect to amendment of the Mining Act; and

(e) whether the New South Wales Government should commence legal proceedings, or take any other action, against any individual or company in relation to the circumstances surrounding the allocation of Exploration Licence No. 7270.'

3.3 The ICAC investigation is now looking at a number of exploration licences and leases in addition to the one covering Doyles Creek.

3.4 In a meeting with the Director General, the Commissioner of the ICAC suggested that the Premier may wish to confirm in writing that the NSW Government would welcome, in due course, recommendations from the Commission along the lines referred to in paragraphs (c) to (e) of the resolution above, in respect of those other licences and leases and not just Doyles Creek."

On 30 January 2013 the Premier wrote to the Commissioner in the following terms (the Premier's letter):

"I am writing in relation to the Commission's current investigations concerning certain mining exploration licences (Operations Jasper and Acacia).

On 11 November 2012 (Legislative Assembly) and 23 November 2012 (Legislative Council), a resolution was passed under section 73 of the Independent Commission Against Corruption Act 1988 referring to the Commission for investigation and report certain matters relating to Exploration Licence No. 7270 under the Mining Act 1992 over the Doyles Creek area.

The resolution included that the Commission should report on:

'(c) any recommended action by the New South Wales Government with respect to licences or leases under the Mining Act over the Doyles Creek area;

(d) any recommended action by the New South Wales Government with respect to amendment of the Mining Act; and

(e) whether the New South Wales Government should commence legal proceedings, or take any other action, against any individual or company in relation to the circumstances surrounding the allocation of Exploration Licence No. 7270.'

The resolution also authorised the Commission to inquire into any related matters.

It is apparent that the Commission's investigations in respect of Operations Jasper and Acacia concern a number of other exploration licences and leases, as well as Exploration Licence No. 7270 over the Doyles Creek area.

Accordingly, I am writing to you now to indicate that the New South Wales Government would welcome any findings and recommendations the Commission may think it fit to make along the lines of the matters referred to in paragraphs (c) to (e) above in relation to any other exploration licences or leases that may be relevant to your investigations."

On 31 January 2013 the Commissioner had a telephone conversation with Mr Eccles. A file note of the conversation prepared by Mr Eccles is to the following effect:

"The Commissioner advised that Minister Hazzard had spoken to him with the advice that he (the Minister) could not take matters before the current ICAC inquiry into account when considering whether to grant a development application (DA). This would have the practical effect of preventing ICAC related matters being taken into account in the decision to issue a mining lease as such a lease is for all intents and purposes automatically granted once a DA is provided.

The Commissioner then described the following legislative pathway:

Under s 65(2) of the Mining Act the Minister may grant a mining lease if a development consent is in force.

Under the relevant 2011 SEP, development for the purpose of the mining of coal is a State Significant Development (SSD)

Division 4.1 of the EPA Act

- Under s.89D, the Minister for Planning and Infrastructure is the Consent Authority for the purpose of a SSD

- Under s.89K, a mining lease cannot be refused if it is necessary for a SSD

- S.89H provides that s.79C of the EPA applies to the determination of a DA

S.79C provides the factors that can be taken into account by the Minister in relation to a DA

- Section 79(1)(a) describes the factors and s. 79(c)(e) identifies the public interest as a factor

The Commissioner considers that allegations of Ministerial fraud and corruption are relevant to the public interest.

Under the ICAC Act, evidence given in the course of an inquiry cannot be used in criminal/civil proceedings. The Commissioner advises that the decision by the Minister to issue a DA is an administrative action and is not caught by the statutory limitation on the use of ICAC inquiry evidence. The Minister may, therefore, have full regard to such evidence.

The Commissioner believes that the Minister should not issue a DA in relation to Mt Penny until the report of the current inquiry is delivered to Parliament.

The Commissioner concluded by advising that he was speaking to me and providing formal advice pursuant to s.13(3)(a) of the ICAC Act."

Later that day the Commissioner sent a letter to Mr Eccles. The letter contained the following comments:

"The Environmental Planning and Assessment Regulation 2000 (the Regulation) makes limited provision for consideration of the public interest in relation to Part 3A matters.

Section 75I (of Part 3A of the EPA Act) requires the Director-General to give an environmental assessment report to the Minister for the purposes of the Minister's consideration of the application. Clause 8B of the Regulation provides that the Director-General's report under section 75I is to include, inter alia, 'any aspect of the public interest that the Director-General considers relevant to the project'. While this is fairly broad, it may be open to argument that, as the report concerns environmental assessment, the public interest issues to be addressed are limited to those relevant to the environmental assessment. Whilst this might be clarified by amending the Regulation, another difficulty is that the public interest issues must be identified by the Director-General in his report. The Minister is not entitled, under the Regulation, to take into account public interest considerations not addressed in the report.

There is an alternative approach.

Clause 6(2) of Schedule 6A of the EPA Act provides that a development may be declared to be of State significance whether or not the development is a transitional Part 3A project. On the making of the declaration the development ceases to be a transitional Part 3A project.

Division 4.1 of Part 4 of the EPA Act deals with development that is State significant development. Section 89H (which is in Division 4.1) provides that section 79C of the EPA Act applies to the determination of the development application.

If, therefore, the Minister was to declare the Mt Penny project of State significance it would no longer be a transitional Part 3A project and, as the relevant consent authority, the Minister would be able to take into account the public interest under section 79C when determining the application.

Whether the Minister who granted the exploration licence for the proposed development acted fraudulently or corruptly is a factor which should be taken into account in determining whether it is in the public interest to grant the development application.

The factual and any corrupt conduct findings made by the Commission in the present investigation will be relevant to a consideration of the public interest. It would also be open to the Commission to state its opinion or make a recommendation that development consent should not be granted (see section 13(3) of the ICAC Act). Such an opinion or recommendation may also be relevant to the public interest issue. However, relevant findings and recommendations will only be available once the Commission publishes its report, and this will not occur until the middle of the year.

The evidence given by witnesses at the public inquiry is available before the Commission publishes its report. Such evidence can be taken into account in considering the public interest question. Although the evidence has been given under objection, the effect of the objection is that the evidence cannot be used against the witness '...in any civil or criminal proceedings or in any disciplinary proceedings' (section 37(3) of the ICAC Act). Consideration by the Minister of the public interest does not involve such proceedings.

I confirm that I have given you the information disclosed in our telephone conversation and in this letter as I consider, pursuant to section 111(4)(c) of the ICAC Act that, it is in the public interest to do so."

Also on 31 January 2013, the solicitor for the Commission wrote to Mr Eccles in the following terms:

"I refer to the Commissioner's letter of today's date.

Since sending the letter I have had the opportunity of speaking with Mr Sam Haddad, the Director General of the Department of Planning and Infrastructure. The Commissioner has asked me to convey to you Mr Haddad's comments.

The Department received a draft environmental assessment which it considered inadequate. The applicant is required to lodge a new environmental assessment before the matter can proceed. It has not yet done so. However, once the new assessment is received the Department must proceed to consider the application. Mr Haddad has advised that the Department has received legal advice that it cannot delay or suspend consideration of the application to await the outcome of the Commission's investigation.

Mr Haddad has confirmed that it is his understanding that the Environmental Planning and Assessment Regulation 2000 makes limited provision for consideration of the public interest in relation to Part 3A matters. He believes the reference to public interest in Clause 8B is unclear and possibly needs to be clarified by amendment to the Regulation. He has previously considered environmental, economic and social issues in his section 75I report and is unsure that he would be able to take into account broader considerations such as the evidence before the Commission or any Commission findings or recommendations in preparing that report.

I discussed with him the possibility of the development being declared a State significant development so that section 79C of the EPA Act would apply when the Minister determines the application. Mr Haddad considered this would be a feasible approach but noted that he had not given considered thought to whether the reference to public interest in that section was broad enough to encompass taking into account considerations such as the evidence before the Commission or any Commission findings or recommendations in preparing that report."

It should be noted that the inquiry had resumed on 21 January 2013. The final witness from Cascade Coal gave evidence on 31 January 2013.

On 5 February 2013, the solicitor for the Commission sent a letter to Mr Bret Walker SC seeking advice on the following terms:

"I refer to my letter of 20 December 2012. The Commission seeks your advice on two matters connected with the issue of whether the Government or the relevant minister can take action to refuse to grant a mining lease for the Mt Penny tenement.

In particular, your advice is sought with respect to:

(a) whether, in order to attract the public interest criteria under section 79C of the Environmental Planning and Assessment Act 1979 (the EPA Act) when determining the current major project application for the Mt Penny tenement, the Minister for Planning and Infrastructure can declare the Mt Penny tenement a development of State significance, and

(b) whether, in considering the public interest under section 79C of the EPA Act, the Minister is entitled to take into account the circumstances in which the tenement was created and the exploration licence was granted."

On 6 February 2013, the Commissioner announced that he had received the Premier's letter. He read out its contents and then made the following remarks:

"That is the end of the letter. I wish to say something about that. The Commission is considering responding to that letter by providing advice as to any recommended action in respect of the tenement which is being investigated in this section of the inquiry, that is the tenement the subject of Operation Jasper. In my view it is urgent that advice should be given to the Government by the Commission in regard to ensuring that the Government has powers to take into account all matters of public interest in deciding what to do about the tenement. I propose, unless I decide otherwise, to give such advice within the next 10 days. I'm advising all parties now so that if they wish to they can make any submissions to the Commission within that period."

On 11 February 2013, the Commissioner indicated at the inquiry the steps he proposed to take in response to the Premier's letter and invited the parties to make submissions in relation to the matter:

"In response I give the following details. At this stage the Commission proposes to give the Premier advice as to the following issues, (a) whether whatever factual findings may be made in the future the evidence led so far and the media publicity that has arisen require the application of public interest criteria to the issues described below; (b) the considerations that in law apply to the grant or refusal of a development application sought in respect of the Mount Penny tenement; (c) the considerations that in law apply to the grant or refusal of a Mining Lease in respect of the Mount Penny tenement; (d) whether public interest criteria now form part of the considerations referred to in paragraphs (b) and (c); (e) if in the Commission's view public interest criteria do not now apply to any of those considerations what steps should be taken to ensure that such criteria will apply including but not limited to the passing of appropriate legislation.

I wish to emphasise that in giving such advice the Commission shall not make any factual findings whatever, the factual finding that the Commission makes shall only be made once all submissions are in and the first public notice of those findings will be given when the Commission publishes its report to Parliament. The Commission's jurisdiction to give such advice may be found in section 14(2)(b) of the Independent Commission Against Corruption alone but that jurisdiction, it's perhaps more desirable to use the word power in this context, may also be derived from sections 13(1)(d), (e) and (f).

In extending this invitation to parties to address these issues the Commission is not thereby recognising that it has any obligation to do so. It is merely inviting parties to make submissions if they so wish in order to receive as much assistance as possible before providing the advice sought by the Premier."

There followed a letter from the solicitors for the applicant to the Commission dated 13 February 2013. The relevant parts of the letter were as follows:

"6 It is not immediately apparent to us that the resolutions referred to in the Premier's letter constitute for the purposes of s 73 of the Independent Commission Against Corruption Act 1988 (NSW) (the ICAC Act), a referral to the Commission of any question relating to actions that may or should be taken by the New South Wales Government concerning EL 7406. Nor do we understand the ICAC Act to confer upon the executive government of New South Wales the power to expand the scope of a referral purportedly made under s 73 of that statute, without any consultation with, or resolution passed by, the Houses of the New South Wales Parliament.

7 That being so, we do not consider it appropriate for the Premier to have communicated with the Commission in respect of the conduct of Operation Jasper as he has done or for the Commission to have received that communication and to act upon it in the manner which appears to be contemplated in the Commissioner's announcement on 6 February 2013. After all, to the extent that the Premier requires legal advice in relation to EL 7406, that maybe sought from the Solicitor-General of New South Wales or the Crown Solicitor, and to the extent that some of policy advice is required, he is perfectly capable of availing himself of the knowledge and professional judgment of officers within the New South Wales public service.

8 Nonetheless, notwithstanding our concern about the appropriateness of the communication and the course apparently proposed by the Commissioner, we make the following observations about the Premier's letter and the Commissioner's announcements:

8.1 the Premier does not raise the need for urgent advice to be provided to the Government on these issues;

...

8.4 the announcements by the Commissioner support an inference that the Commissioner has formed a view that he is in a position to provide urgent and separate advice to the Government 'as to any recommended action in respect of the tenement which is being investigated in this section of the inquiry, that is the tenement the subject of Operation Jasper' (which the second announcement makes it clear is the Mount Penny tenement);

...

8.7 the Commissioner's announcement of 6 February 2013 concerning the urgency of the advice proposed to be provided to the New South Wales Government, and his further statement of 11 February 2013 as to the nature of that advice, together indicate that, in the Commissioner's view, the New South Wales Government should, even before the publication of his report, consider whether it should refuse development consent or a mining lease in respect of the Mount Penny tenement. Furthermore, it appears to be the Commissioner's view that this should be informed by public interest considerations, presumably of a sort capable of emphasising such matters as corrupt conduct. It is difficult to see, in light of those pronouncements, how the Commissioner can possibly avoid the impression that he might have come to a concluded view concerning, among other things, allegations of corrupt conduct on the part of major investors in Cascade Coal Pty Ltd. Certainly, that impression has not been dispelled by the Commissioner's statement that factual findings will only be made after the receipt of submissions. After all, this leaves open the possibility that the Commissioner has come to a fixed view as to what those findings should be, one that is incapable of alteration by any evidence or arguments which have yet to be provided. So much may suggest itself to an informed, fair-minded observer.

9 Given the above, our client is concerned that:

9.1 the Commissioner might have apparently formed views on these issues sufficient to permit him to provide the advice contemplated to the Government before the conclusion of evidence or the receipt and consideration of submissions;

9.2 the Commissioner is intending to provide the advice contemplated in these circumstances and notwithstanding that the public examination has been conducted by him on the basis that all interested parties will have the opportunity to make written submissions before any report is made and published. In this respect, we note that the Commissioner has been at pains to emphasise during the course of the public inquiry that the Commission does 'not have a case' but is investigating the matters the subject matter of the inquiry and has refused to allow cross examination on many occasions where he considers that the matters raised can be dealt with in submissions;

9.3 the advice contemplated will not only reflect matters determined by the Commissioner prior to the conclusion of the public examinations (in the manner contemplated by the Commissioner to date) but will contain matters which may be damaging to the interests of our client in a public fashion in circumstances where he has not been afforded a fair or an appropriate opportunity to protect his position.

10 We respectfully request that before the Commissioner takes any of the steps contemplated, the Commission:

10.1 identify with precision all of the facts, matters and circumstances which have led the Commissioner to form the view that the advice contemplated is urgent and should be provided separately to his report;

10.2 identify with precision the nature of the advice contemplated to be provided;

10.3 disclose any other facts, matters or circumstances of which the Commission is aware which may have a bearing on this issue;

10.4 provide our client with a reasonable opportunity, upon consideration of the matters requested in paragraphs 10.1 and 10.2, to consider his position and take any further action that he considers appropriate."

On 14 February 2013, before resuming the public inquiry the Commissioner made the following remarks:

"The second thing I want to deal with concerns a series of letters that the Commission has received from Yeldham Price O'Brien Lusk acting for Mr Duncan. Is Mr Ng here? Are you aware of these letters, Mr Ng?

MR NG: I am.

THE COMMISSIONER: I think it entirely inappropriate for these letters to be written in this form. If there's anything that needs to be said on behalf of Mr Duncan it should be said openly in this hearing. Everything in this public inquiry so far has been undertaken in an open way. I also regard the tone of the letters as impertinent and impertinent in the sense that Yeldham Price O'Brien Lusk appear to regard the Commission and me as some kind of opposing party in litigation making demands and requiring me to give explanations for doing anything.

I can tell you now, Mr Ng, I'm not going to reply to these letters any more. If you've got submissions to make, make them. I will make a short reply to this letter simply summarising what I'm going to say to you now. You've read these letters I take it?

MR NG: I have Commissioner.

THE COMMISSIONER: Yes. So that everybody understands what I'm talking about these letters concerns the statement I made on 11 February 2013 concerning the request that the Premier had made of me and the Commission to give advice. I, again, in the interests of transparency and in the interests of giving everybody a chance to make submissions that letter was made an exhibit in this inquiry.

I made it clear, I think, that in advising people of the contents of the Premier's letter I was not accepting that there was any obligation on the Commission to do that and I would be acting perfectly within my rights to give a reply to the Premier without inviting anyone to make submissions on it. The letters that I - to which I have referred seem to adopt the position that I do have such a duty. I am not going to debate that issue, I'm simply asserting, as I asserted initially, that I do not regard there to be any duty and, Mr Ng, if your clients disagree with that there are very well known means of attempting to exercise their rights if they consider that they have them.

Now one of the questions or demands that are made on me by these letters is to explain the urgency of providing the advice. I explained that before. I think it in the public interest in the light of the nature of the evidence and the media publicity and the public interest generally manifested that the options option (sic) to the Government be made plain to it. I made it quite clear in my letter that I have not formed any opinion as to factual findings and I was not going to make any factual findings in giving the advice. The advice was solely based on the public interest in the Government receiving it. The letter, however, does suggest that despite my statement that I will not make any factual findings, and I have not, and that the only factual findings I will make is when reporting, the letter suggests that I might well make factual findings. I regard that as impertinent, Mr Ng. When I have said that I will not I expect that to be accepted by legal practitioners. Now - - -

MR NG: With respect - - -

THE COMMISSIONER: Can I continue please?

MR NG: Of course, Commissioner.

THE COMMISSIONER: Now, I am going to proceed to advise the Premier as soon as possible, I have said that I was going to advise him by Friday, that is tomorrow, it may be that I will not be able to comply with that because this hearing has taken longer than I expected. But I intend, unless otherwise restrained by a Court, to proceed to respond to the Premier's letter. You understand that, Mr Ng?"

On 15 February 2013, the following exchange took place between a reporter, Mr Quentin Dempster, and the Minister for Resources and Energy, Mr Chris Hartcher, on a television program:

"DEMPSTER: Minister welcome. Will the Government revoke the 11 exploration licences issued by Ian MacDonald's department in 2008 including the Obeid/Cascade Coal Mt Penny tenement if the ICAC finds the process was tainted by corruption?

MINISTER: The Government has asked these very questions to the ICAC Commissioner. Originally in relationship to (sic) Doyles Creek licence but recently some 10 days to 2 weeks ago the Premier also wrote to the ICAC Commissioner and asked his views in respect of the Bylong Valley licences as well.

...

DEMPSTER: What was your reaction when you saw evidence that Monaro Coal one of the bidders had bid $25 million to become the frontrunner for that Mt Penny licence then withdrew and Cascade Coal, Travers Duncan, Cascade Coal got the licence for just $1 million. What was your reaction to that?

MINISTER: I know - I know - it was a rort - it was a clear-cut rort. There is no other word for it. The people of NSW as the ICAC Commissioner said have been cheated - there's been a fraud - we believe there's been a fraud committed on the people of this state and if there are legal means by which we can recover what is owed to the people of this state clearly we will investigate them."

On 19 February 2013, Mr Walker provided his advice in response to the letter of 5 February 2013. He answered both questions in the affirmative. It is not necessary to set out his advice in detail. However, three paragraphs are relevant in considering the substance of the appeal:

"16 In summary in relation to a Part 3A process, there is a very respectable argument that if the Director-General were not to raise a particular matter of public interest in the report to the Minister, the Minister could not take that matter into account in deciding, say, to disapprove the project. On balance, I prefer the opposite view - but my opinion recognises and does not eliminate the existence of that respectable view.

17 Before leaving the Part 3A process, I note that, on my reading of cl 8b of the Regulation, the Director-General is empowered to take into account and report on irregularities of a sinister kind in a process by which a project has reached a stage of an environmental assessment. I would not accept, as if it were a rule, that transparency, probity and propriety of antecedent steps in relation to a project have no connexion with environmental assessment. Environmental assessment has always involved, under the EPA Act, a measure (albeit various in different circumstances) of public involvement. It has always been part of a process by which proponents - very often, corporations trading for profit and the investors with interests in the corporations - stand to gain very substantially from the exercise of administrative and executive decisions. It seems to me that a Director-General can and perhaps should note his or her misgivings about or outright deprecation of such irregularities.

18 By way of an extreme example, if the Director-General were aware that there was a nefarious connexion between the Minister and a proponent or a person standing behind the proponent with an interest in the matter, it is to be hoped the Director-General would include under the rubric of public interest in the report to the Minister that the Minister's proposed conduct of considering and deciding the application would be contrary to the public interest."

Following receipt of the advice of Mr Walker, the Commissioner replied to the Premier's letter. The relevant part of the response, which was dated 20 February 2013 is as follows:

"The Operation Jasper segment of the public inquiry is examining the circumstances in which the Mt Penny mining tenement was created and an exploration licence was granted.

The Commission has been informed that on 16 December 2010 the Minister for Planning and Infrastructure, through the Department of Planning and Infrastructure, received a project application pursuant to the (now repealed) provisions of Part 3A of the Environmental Planning and Assessment Act 1979 (the EPA Act) for an open cut coal mine at Mt Penny. The project application is being dealt with as a transitional Part 3A project under Schedule 6A of the EPA Act. The Department of Planning and Infrastructure has advised the applicant that additional information is required in support of the project application before it can be publicly exhibited. That information is yet to be supplied.

No application for a mining lease has been made to date for the Mt Penny tenement.

On 11 February 2013 I announced in the public inquiry that the Commission proposed responding to your letter by giving advice as to the following issues:

a) Whether, whatever factual findings may be made in the future, the evidence led so far and the medial publicity that has arisen require the application of public interest criteria to the issues described below.

b) The considerations that in law apply to the grant or refusal of a development application sought in respect of the Mt Penny tenement.

c) The considerations that in law apply to the grant or refusal of a mining lease in respect of the Mt Penny tenement.

d) Whether public interest criteria now form part of the considerations referred to in paragraphs b) and c) above.

e) If, in the Commission's view, public interest criteria do not now apply to any of those considerations, what steps should be taken to ensure that such criteria will apply, including but not limited to the passing of appropriate legislation.

I made it clear at the time of my announcement that, in giving such advice, the Commission would not make any factual findings whatever. Nothing contained herein should be taken as indicating that the Commission has made any factual findings or intends to make factual findings of a particular nature.

To assist in preparing a response to your letter the Commission sought advice from Mr Bret Walker SC. Copies of the Commission's letters to Mr Walker of 5 and 7 February are enclosed. A copy of Mr Walker's advice of 19 February in response to those letters is enclosed.

I will now address each of the issues I identified on 11 February 2013 and, where appropriate, refer to particular sections of Mr Walker's advice.

Issue a)

Irrespective of any factual findings the Commission may ultimately make, or any legal challenge to any findings of corrupt conduct, it is now open to the NSW Government to consider that in light of the nature of the evidence led to date in the public inquiry, the substantial media publicity that has arisen as a result of that evidence and the general notoriety of the issues which are the subject of that evidence, public interest criteria should be applied to any decision affecting the Mt Penny exploration licence and any grant or refusal of any development application or application for a mining lease.

Issue b)

The relevant considerations that in law apply to the grant or refusal of the relevant development application are set out in paragraphs 4 to 8 of Mr Walker's advice.

...

Issue d)

Mr Walker's advice is that under the EPA Act public interest criteria form part of the considerations in determining whether to grant a development application. This is so whether the development is being dealt with as a transitional Part 3A development of a State significant development.

This issue is addressed in paragraphs 8 to 18 of Mr Walker's advice.

Where an application is being dealt with under Part 3A of the EPA Act, the Minister for Planning and Infrastructure is required to consider a report by the Director General of the Department of Planning and Infrastructure before determining the application. Such a report may address any public interest issues the Director General considers relevant to the development.

The Commission notes Mr Walker's opinion, expressed in paragraph 16 of his advice, that the Minister for Planning and Infrastructure could take into account public interest considerations when considering a Part 3A approval even if those considerations were not identified in the Director General's report. The Commission agrees with this opinion but notes Mr Walker's advice that there is a very respectable argument that the Minister should not take into account any matter not raised by the Director General.

Where an application is being dealt with as a State significant development, then section 79C of the EPA Act would apply. This section directly requires the Minister for Planning and Infrastructure to take into account the public interest when determining a development application.

Mr Walker has considered whether the Mt Penny tenement could be declared to be a State significant development in order to attract the requirement under section 79C of the EPA Act for the Minister for Planning and Infrastructure to directly consider the public interest to determine a development application. Mr Walker's advice on this issue is set out at paragraphs 19 to 23. The Commission agrees with the views expressed by Mr Walker.

Given the concern expressed by Mr Walker in paragraph 16 of his advice (which, it is noted, is a concern held by the Commission), the Government may consider it prudent to declare the project to be a State significant development so that there is no doubt the Minister for Planning is directly entitled to take into account the public interest in determining the development application.

In considering the public interest the Commission considers it would be open to the Minister for Planning and Infrastructure (and the Director General in the event the project remains a transitional Part 3A project) to take into account matters such as 'irregularities of a sinister kind' referred to in paragraph 17 of Mr Walker's advice and any 'nefarious connexion between the (then) Minister (for Mining) and a proponent or a person standing behind the proponent with an interest in the matter' as referred to in paragraph 17 of Mr Walker's advice.

Mr Walker has concluded that the provisions of the Independent Commission Against Corruption Act 1988 (the ICAC Act) would not prevent the evidence given to the Commission in the public inquiry from being taken into account by the Minister for Planning and Infrastructure (or, by extension, the Director General) when considering whether it is in the public interest to grant a development consent.

Although the evidence given by witnesses in the public inquiry was given under objection, this only prevents evidence given by a witness from being used against the witness in any 'civil or criminal proceedings or in any disciplinary proceedings' (sections 37(3) of the ICAC Act). Consideration of the public interest does not involve civil, criminal or disciplinary proceedings.

This issue is dealt with at paragraphs 24 to 27 of Mr Walker's advice. The Commission agrees with that advice.

Issue e)

As Mr Walker was of the opinion that public interest criteria do apply, and that evidence given to the Commission about 'the antecedents of the tenement and the application to exploit it' could be taken into account in considering the public interest when determining a development application, it was not necessary for him to address this issue further.

The Commission is aware that the Department of Planning and Infrastructure has received legal advice which casts doubt on whether evidence relating to the circumstances in which an exploration licence was granted could be taken into account in assessing a development application because of a lack of legal interdependence between the granting of an exploration licence and the approval of a development application.

The Commission disagrees with that advice.

The Commission considers that if the Minister for Planning and Infrastructure considers the grant of an exploration licence was tainted by misconduct (in consequence of which a great deal of money was made by people which, but for the tainted conduct, they would not have made) then it must follow that the Minister can take that into account in deciding whether or not it is in the public interest to grant or refuse a development application. That is because a development application is an application to develop the tenement which, on the view formed by the Minister, was granted in tainted circumstances. It seems to the Commission that it is self evident that in such circumstances the Minister's view about the taint that attaches to the exploration licence must be relevant in determining whether the tenement should be developed further.

If, despite the opinion given by Mr Walker and the view expressed by the Commission, the Government has doubt that evidence relating to the circumstances in which an exploration licence was granted could be taken into account in determining whether, in the public interest, a development application should be granted, it would of course be open to the Government to legislate to ensure that such evidence could be taken into account."

On 6 March 2013 the proceedings the subject of this appeal were commenced.

The legislative background

Prior to considering the primary judge's reasoning and the parties' submissions, it is convenient to set out the legislative background.

The Commission is constituted by the Independent Commission Against Corruption Act 1988 (the Act). The principal objects of the Act are set out in s 2A in the following terms:

"2A The principal objects of this Act are:

(a) to promote the integrity and accountability of public administration by constituting an Independent Commission Against Corruption as an independent and accountable body:

(i) to investigate, expose and prevent corruption involving or affecting public authorities and public officials, and

(ii) to educate public authorities, public officials and members of the public about corruption and its detrimental effects on public administration and on the community, and

(b) to confer on the Commission special powers to inquire into allegations of corruption."

It will be noted that the primary objects of the Act include both the investigation and prevention of corruption.

Clause 1 of Schedule 1 of the Act provides that a person is not eligible to be appointed as a Commissioner unless the person is qualified to be appointed as a judge of the Supreme Court of the State or of any other State or Territory, a judge of the Federal Court, a justice of the High Court, or a former judge or justice of any of those Courts.

Section 10 of the Act deals with complaints. It provides that any person may make a complaint to the Commission that concerns corrupt conduct and, further, that the Commission may investigate a complaint or decide that it need not be investigated.

Part 4 of the Act deals with the functions of the Commission. Section 12 provides as follows:

"12 In exercising its functions, the Commission shall regard the protection of the public interest and the prevention of breaches of public trust as its paramount concerns."

It is to be noted that one of the paramount concerns of the Commission is a prevention of breaches of public trust.

Section 13 sets out the principal functions of the Commission. Of particular relevance are subs (1) to (3) which provide as follows:

"(1) The principal functions of the Commission are as follows:

(a) to investigate any allegation or complaint that, or any circumstances which in the Commission's opinion imply that:

(i) corrupt conduct, or

(ii) conduct liable to allow, encourage or cause the occurrence of corrupt conduct, or

(iii) conduct connected with corrupt conduct,

may have occurred, may be occurring or may be about to occur,

(b) to investigate any matter referred to the Commission by both Houses of Parliament,

(c) to communicate to appropriate authorities the results of its investigations,

(d) to examine the laws governing, and the practices and procedures of, public authorities and public officials, in order to facilitate the discovery of corrupt conduct and to secure the revision of methods of work or procedures which, in the opinion of the Commission, may be conducive to corrupt conduct,

(e) to instruct, advise and assist any public authority, public official or other person (on the request of the authority, official or person) on ways in which corrupt conduct may be eliminated,

(f) to advise public authorities or public officials of changes in practices or procedures compatible with the effective exercise of their functions which the Commission thinks necessary to reduce the likelihood of the occurrence of corrupt conduct,

(g) to co-operate with public authorities and public officials in reviewing laws, practices and procedures with a view to reducing the likelihood of the occurrence of corrupt conduct,

(h) to educate and advise public authorities, public officials and the community on strategies to combat corrupt conduct,

(i) to educate and disseminate information to the public on the detrimental effects of corrupt conduct and on the importance of maintaining the integrity of public administration,

(j) to enlist and foster public support in combating corrupt conduct,

(k) to develop, arrange, supervise, participate in or conduct such educational or advisory programs as may be described in a reference made to the Commission by both Houses of Parliament.

(1A) Subsection (1) (d) and (f)-(h) do not extend to the conduct of police officers, Crime Commission officers or administrative officers within the meaning of the Police Integrity Commission Act 1996.

(2) The Commission is to conduct its investigations with a view to determining:

(a) whether any corrupt conduct, or any other conduct referred to in subsection (1) (a), has occurred, is occurring or is about to occur, and

(b) whether any laws governing any public authority or public official need to be changed for the purpose of reducing the likelihood of the occurrence of corrupt conduct, and

(c) whether any methods of work, practices or procedures of any public authority or public official did or could allow, encourage or cause the occurrence of corrupt conduct.

(2A) Subsection (2) (a) does not require the Commission to make a finding, on the basis of any investigation, that corrupt conduct, or other conduct, has occurred, is occurring or is about to occur.

(3) The principal functions of the Commission also include:

(a) the power to make findings and form opinions, on the basis of the results of its investigations, in respect of any conduct, circumstances or events with which its investigations are concerned, whether or not the findings or opinions relate to corrupt conduct, and

(b) the power to formulate recommendations for the taking of action that the Commission considers should be taken in relation to its findings or opinions or the results of its investigations."

A number of matters may be noted. First, it is evident from s 13(1) that the Commission may carry out an investigation of its own volition. Second, the powers of the Commission are not limited to investigating and reporting corrupt conduct. They include advising public authorities in relation to the prevention and elimination of corrupt conduct (s 13(1)(d)-(h), s 13(2)(b)-(c)) and making recommendations as to action that should be taken in relation to the results of its investigations (s 13(3)(b)). The performance of such functions would inevitably involve ongoing contact with public officials.

Subsections 17(1) and (2) of the Act provide as follows:

"17(1) The Commission is not bound by the rules or practice of evidence and can inform itself on any matter in such manner as it considers appropriate.

(2) The Commission shall exercise its functions with as little formality and technicality as is possible, and, in particular, the Commission shall accept written submissions as far as is possible and compulsory examinations and public inquiries shall be conducted with as little emphasis on an adversarial approach as is possible."

To the extent that it is not implied in s 17(1), s 20 of the Act expressly states that the Commission has power to conduct an investigation of its own volition.

Section 30 of the Act empowers the Commission to hold compulsory examinations. Subsection 30(5) provides that a compulsory examination is to be conducted in private.

Section 31 deals with public inquiries. So far as it is relevant, s 31 provides as follows:

"31(1) For the purposes of an investigation, the Commission may, if it is satisfied that it is in the public interest to do so, conduct a public inquiry.

(2) Without limiting the factors that it may take into account in determining whether or not it is in the public interest to conduct a public inquiry, the Commission is to consider the following:

(a) the benefit of exposing to the public, and making it aware, of corrupt conduct,

(b) the seriousness of the allegation or complaint being investigated,

(c) any risk of undue prejudice to a person's reputation (including prejudice that might arise from not holding an inquiry),

(d) whether the public interest in exposing the matter is outweighed by the public interest in preserving the privacy of the persons concerned.

...

(8) A public inquiry is to be held in public.

(9) Despite subsection (8), the Commission may decide to hold part of the inquiry in private if it considers this to be in the public interest.

(10) Without limiting subsection (9), the Commission may decide to hear closing submissions in private. This extends to a closing submission by a person appearing before the Commission or an Australian legal practitioner representing such a person, as well as to a closing submission by an Australian legal practitioner assisting the Commission as counsel."

It is clear from these provisions that the Commission can conduct a great deal of its business in private, even in circumstances where the Commission has determined that it is in the public interest to hold a public inquiry.

Part 8 of the Act deals with references by and reports to Parliament. Sections 73 and 74 provide as follows:

"73(1) Both Houses of Parliament may, by resolution of each House, refer to the Commission any matter as referred to in section 13.

(2) It is the duty of the Commission to fully investigate a matter so referred to it for investigation.

(3) It is the duty of the Commission to comply as fully as possible with any directions contained in a reference of a matter referred to in section 13 (1) (k).

(4) Both Houses of Parliament may, by resolution of each House, amend or revoke a reference made under this section.

74(1) The Commission may prepare reports in relation to any matter that has been or is the subject of an investigation.

(2) The Commission shall prepare reports in relation to a matter referred to the Commission by both Houses of Parliament, as directed by those Houses.

(3) The Commission shall prepare reports in relation to matters as to which the Commission has conducted a public inquiry, unless the Houses of Parliament have given different directions under subsection (2).

(4) The Commission shall furnish reports prepared under this section to the Presiding Officer of each House of Parliament.

(5), (6) (Repealed)

(7) A report required under this section shall be furnished as soon as possible after the Commission has concluded its involvement in the matter.

(8) The Commission may defer making a report under this section if it is satisfied that it is desirable to do so in the public interest, except as regards a matter referred to the Commission by both Houses of Parliament.

(9) (Repealed)"

Section 111 of the Act contains a secrecy provision. So far as it is relevant it provides as follows:

"111(1) This section applies to:

(a) a person who is or was an officer of the Commission, and

(b) a person who is or was an Australian legal practitioner appointed to assist the Commission or who is or was a person who assists, or performs services for or on behalf of, such an Australian legal practitioner in the exercise of the Australian legal practitioner's functions as counsel to the Commission, and

(c) (Repealed)

(d) a person or body referred to in section 14 (3), 16 (4) or 53 (6), and

(e) a person who is or was an officer of the Inspector.

(2) A person to whom this section applies shall not, directly or indirectly, except for the purposes of this Act or otherwise in connection with the exercise of the person's functions under this Act:

(a) make a record of any information, or

(b) divulge or communicate to any person any information,

being information acquired by the person by reason of, or in the course of, the exercise of the person's functions under this Act.

Maximum penalty: 50 penalty units or imprisonment for 12 months, or both.

...

(4) Despite this section, a person to whom this section applies may divulge any such information:

(a) for the purposes of and in accordance with this Act, or

(b) for the purposes of a prosecution or disciplinary proceedings instituted as a result of an investigation conducted by the Commission in the exercise of its functions, or

(c) in accordance with a direction of the Commissioner or Inspector, if the Commissioner or Inspector certifies that it is necessary to do so in the public interest, or

(d) to any prescribed authority or person."

In relation to subs 111(1)(d), the persons referred to in s 14(3) of the Act are persons to whom information is furnished by the Commission on the understanding that the information is confidential. The persons referred to in s 16(4) of the Act are officers of other agencies with whom the Commission is required to co-operate, whilst the persons referred to in s 53(6) are any persons to whom information is provided under s 111 on a confidential basis. This once again emphasises the private nature of a great deal of the Commission's work.

The reasoning of the primary judge

The primary judge accepted that the test for apprehended bias was that a fair-minded observer might reasonably apprehend that in his conduct of Operation Jasper, the Commissioner might have failed and might be failing to bring an impartial and unprejudiced mind to the matters under investigation. The primary judge noted that the applicant relied on five matters which were said to indicate that a reasonable onlooker might conclude that the Commissioner might have had a closed mind or had pre-judged the issue of whether the Mt Penny exploration licence was procured by corruption involving the then Minister and that the applicant and his associates benefited from such corrupt conduct.

The five matters considered by the primary judge were: first, the contents of the Premier's letter and the circumstances in which it came to be written; second, the advice given to Mr Eccles on 31 January 2013; third, the circumstances in which the Commissioner called for submissions regarding his proposed response to the Premier's letter; fourth, the content of the letter of advice to the Premier of 20 February 2013; and finally, what was described by the applicant as the Commissioner's changing reliance on various sections of the Act in support of the activities he had undertaken and proposed to undertake.

A The Premier's letter

The primary judge emphasised at par [85] that the fair-minded lay observer would have general knowledge of the contents of the Act and the functions performed by the Commissioner and, in particular, an awareness of the Commissioner's investigative and inquisitorial roles. He stated that at the time of the adjournment of the inquiry on 14 December 2012, it would have been open to the Commissioner to publicly extend the terms of reference to the matters the subject of the Premier's letter. In this context he concluded that there was no logical connection between the lack of transparency and the alleged apprehended bias, referring to the second limb of the test in Ebner v Official Trustee in Bankruptcy [2000] HCA 63; (2000) 205 CLR 337 at [8].

The primary judge also considered alternative reasons as to why the Commissioner might have adopted the approach that he took. The primary judge stated that he considered the most obvious explanation was that the public would better receive the extension of the inquiry if it came from the Government. He acknowledged this was speculation.

Further, in concluding that there was "nothing sinister (in the apprehended bias sense)" in the contact between the Commissioner and the Director General, he noted at par [90] that it would be expected that such contact would occur in the normal course of events, pointing out that nothing put before the Court demonstrated that any fair-minded observer would expect all dealings to be revealed. He also stated that the Premier's letter and the Commissioner's response alerted the applicant and his associates that the evidence adduced might be taken into account by the Planning Minister.

In concluding that the Premier's letter and the circumstances by which it came into existence did not give rise to the possibility of apprehended bias, the primary judge referred to both the statement made by the Commissioner at the public inquiry on 14 February 2013 and in his letter to Mr Eccles of 20 February 2013, that he had not reached any conclusion concerning the Mount Penny tenement.

B The events of 31 January 2013

The primary judge concluded at par [95] that, contrary to the applicant's submissions, there was urgency in responding to the Premier's letter. He pointed out that the Planning Minister had received advice that he might be obliged to deal with the development application without taking into account the circumstances in which the exploration licence was granted and, further, pointed to the effect of s 75V(1)(c) of the EPA Act to which I have referred at par [12] above. He concluded that this was a matter of practical significance to the Commissioner, as any findings made as a result of the inquiry that were adverse to Cascade Coal would have little practical effect if the development application and mining lease were granted. The primary judge concluded at par [99] that, "As the Commissioner said on a number of occasions, he was doing no more than endeavouring to persuade the Planning Minister to wait until the outcome of the inquiry was known before granting project approval for the Mount Penny Mine". He concluded at par [103] that the evidence indicated the Commissioner had formed the view that project approval should not be issued prior to his report. The primary judge stated that it was reasonable for the Commissioner to recommend that the development application should not proceed until he had made findings of fact.

The primary thrust of the applicant's submissions under this head related to the Commissioner's failure to disclose his previous conversation and correspondence with Mr Eccles, particularly in the context of his remarks concerning transparency. The submission effectively amounted to two propositions. First, because the Commissioner had already given advice a fair-minded observer might consider his calls for submissions were not genuine. Second, in these circumstances, a fair-minded observer might conclude that the reason for calling for submissions was to give the impression of fairness in respect of a matter which he had pre-judged. Added to this was the submission that a fair-minded observer might believe that it was possible that the Commissioner was loath to disclose his previous advice because it would give rise to the impression that he had pre-judged the issue of corrupt conduct.

It is important to first consider the context in which the Commissioner's comments concerning transparency were made. The solicitors for the applicant had sent a letter suggesting that the course adopted by the Premier in communicating with the Commissioner was inappropriate and asserting that the Commissioner's statements of 6 and 11 February 2013 indicated he held the view that before publication of his report the Government should "consider whether it should refuse development consent for a mining lease in respect of the Mount Penny tenement". The letter also suggested that it was difficult to see how the Commissioner "can possibly avoid the impression that he might have come to a concluded view concerning, among other things allegations of corrupt conduct". The letter included in par [10] what could be described colloquially as a request for further and better particulars.

The first thing that should be noted is that the Commissioner did not, on either 6 of 11 February 2013, make any statement to the effect that the Government should consider whether it should refuse consent to the development application. He simply stated that all matters of public interest should be taken into account in the approval process.

The second matter to be noted is that the Commissioner's first comment on 14 February 2013 concerning transparency was made in the context of the Commissioner criticising the solicitors for the applicant for writing a letter complaining about his conduct rather than raising it at the public inquiry. That is clear from the context in which the comment was made. It is clear the Commissioner was only referring to the public inquiry. That comment does not contain any implication that the Commissioner had not had private communications outside the public inquiry.

The Commissioner's second comment "[a]gain in the interests of transparency and in the interests of giving everyone a chance to make submissions that letter was made an exhibit in this inquiry" related to the reason the Premier's letter was tendered. A fair-minded observer might conclude that the Premier's letter was the only communication between the Commissioner and the Executive on this issue. The fact that this was revealed to be incorrect and the content of the other communications later disclosed, in my opinion might lead a fair-minded observer to consider that the Commissioner might have formed a strong or even final view as to the advice to be given to the Premier. Indeed, the Commissioner had already indicated the advice he thought appropriate in his statement of 11 February 2013 consistent with the terms of the letter which had been previously sent to Mr Eccles.

However, unless the undisclosed material itself revealed material from which a fair-minded observer might conclude that it was possible the Commissioner had formed a closed mind on the issue of corrupt conduct, its discovery would not lead to a possibility in the mind of such a fair-minded observer that the Commissioner might have had a closed mind on that issue, as distinct from the issue of the appropriate advice to be given to the Premier. For the reasons I have given, the earlier communications do not give rise to that possibility.

The applicant also submitted that a fair-minded observer might have considered the Commissioner had not disclosed the material because he believed it would give the impression that the Commissioner had pre-judged the issue. However, for the reasons I have given, as the earlier material would not have given rise to such an apprehension, there is no basis for concluding that a fair-minded observer might consider the reason for non-disclosure was to avoid that apprehension.

Finally, the applicant submitted that the disclosure of the Premier's letter would cast doubt upon whether the invitation to make submissions was genuine which in turn might indicate that the Commissioner was attempting to create the impression of fairness on a matter already decided adversely to the applicant and his associates.

There are two answers to this submission. First, notwithstanding the views expressed by the Commissioner to Mr Eccles, on 6 February 2013 when the Commissioner called for submissions at the inquiry as to the manner in which he should respond to the Premier's letter, the Commissioner had sought advice from Mr Walker on two questions directly relating to the proposed response (see par [22] above). The fact that the Commissioner was continuing to seek advice on the question would suggest to a fair-minded observer that the Commissioner had not finally determined how to respond to the Premier's letter. In those circumstances a fair-minded observer could not reasonably conclude that the call for submissions was not genuine.

Second, even if this is incorrect, the most a fair-minded observer might conclude from such non-disclosure was that the Commissioner had a closed mind on the appropriate means of responding to the Premier's letter. Such a fair-minded observer might conclude the Commissioner intended to respond in the manner he had already responded to Mr Eccles, regardless of the submissions he received. However, if it is accepted that the latter could not raise the possibility of pre-judgment in the mind of a fair-minded observer, there is no logical connection between the failure to disclose the letter and reasonable apprehension of pre-judgment on the issue of corrupt conduct.

It follows the grounds of appeal under this head fail.

F The advice to the Premier

The first submission made by the applicant was that there was no reason at all to send the letter to the Premier as advice had already been given to Mr Eccles. However, if the earlier advice and the response to the Premier's letter do not themselves exhibit pre-judgment then there is no logical connection between duplication of the advice and that issue. I have already stated why the letter to Mr Eccles could not indicate the possibility of pre-judgment to a fair-minded observer.

The primary complaint concerning the Premier's letter was the incorporation into the letter of the references by Mr Walker in his opinion to "nefarious conduct" and "irregularities of a sinister kind" coupled with the Commissioner's failure to state that any decision should be deferred pending receipt of his report.

It must be remembered that a copy of Mr Walker's advice and the instructions which he was given to prepare that advice were enclosed with the response to the Premier. The Commissioner was adopting the words used by Mr Walker in par [17]-[18] of his advice. Those were the words Mr Walker chose to use for what I have described as corrupt conduct. The fact that the Commissioner adopted those words, referring expressly to their source, could not in my opinion lead to the possibility of a fair-minded observer concluding that the Commissioner might have had a closed mind on the issue of whether such conduct in fact existed.

The Commissioner made it clear in writing the letter that his advice was not dependent on his having made findings. Thus in relation to issue (a) in the letter he stated that the public interest criteria should be applied irrespective of any factual findings or legal challenges to any findings of corrupt conduct he might make. Further in relation to issue (e) the Commissioner stated in effect that if the Planning Minister took the view that the grant of the mining licences was tainted by corrupt conduct, he could take this into account in determining whether to either grant or refuse the licence. The Commissioner himself did not express a view one way or the other whether such corrupt conduct existed or whether it should lead to a refusal of the licence.

Having regard to the advisory function performed by the Commission, it was appropriate in my opinion for the Commissioner to express the view that public interest considerations could be taken into account in determining the fate of the development application and that if the Planning Minister was of the view that the grant of the licence was tainted by corrupt conduct, that was a matter to be taken into account in determining whether or not to grant the development application. The letter in my opinion did not encourage the Minister to deal with the application prior to the publication of the Commission's report but merely stated what should be taken into account when the Minister in fact came to deal with it. In these circumstances and in circumstances where the letter gave no indication as to the findings the Commission might make, it does not seem to me that the adoption of Mr Walker's expressions could give rise to the possibility in the mind of a fair-minded observer that the Commissioner might have had a closed mind on the issue of corrupt conduct.

The grounds under this head also fail.

G The Commissioner's denial of having made factual findings

Because of the conclusions which I have reached on the other grounds of appeal, it is unnecessary to deal with this ground in any detail.

However, I do not agree that the primary judge gave "almost determinative" weight to the Commissioner's denial. His statement at par [119] that no basis had been identified for rejection of these denials, is simply a reflection of his earlier findings as to the absence of apprehended bias.

Nor do I agree that such denials are only relevant to questions of actual bias as distinct from apprehended bias. A fair-minded observer would take into account statements by a decision-maker as to his or her state of mind in determining whether the decision-maker might not be able to fairly adjudicate on the issue before him. Such statements may not be determinative but they are certainly a relevant factor.

In these circumstances the primary judge did not err in his treatment of these denials, or fail to correctly apply the test for apprehended bias.

H The impression that a fair-minded observer might form from the totality of the facts

The applicant criticised the primary judge for failing to look at all matters complained of holistically as well as individually. It is not clear that in fact he adopted this approach. At par [76] he appeared to accept the applicant's submission that matters had to be looked at individually and together although he did not expressly adopt this course in his judgment.

The nub of the applicant's case on this issue is that a fair-minded observer might form the view that the Commissioner, having determined it was appropriate that the Planning Minister take either his findings or the evidence before the Commission into account in deciding on the fate of the development application, sought the Premier's letter as political cover and having received the letter made it public and called for submissions without disclosing that in fact he had sought the letter and already given such advice. It was said that a fair-minded observer might consider in those circumstances that what was done was to create an impression of fairness which would be contradicted if communications which had taken place prior to his announcement of the receipt of the Premier's letter had been disclosed. Finally it was submitted that in addition, the letter to the Premier might be construed by a fair-minded observer as encouraging the Planning Minister to reject the development application. From these matters in combination it was submitted that a fair-minded observer might have considered that the Commissioner might have had a closed mind on the issue of corrupt conduct.

I have dealt with all these matters individually and found that none of them might demonstrate the possibility of a closed mind to a fair-minded observer. In my opinion, taken in totality they also could not reasonably give rise to the possibility of a fair-minded observer considering that the Commissioner might have had a closed mind. At most in my opinion, they would demonstrate to a fair-minded observer that in January 2013 the Commissioner formed a view as to what should be taken into account in dealing with the development application, communicated that view but decided to withhold it until he received political cover. In this context a fair-minded observer might at most consider that the Commissioner had formed a view on what the Planning Minister should take into account in considering the development application. However, for the reasons I have given it does not follow that a fair-minded observer could reasonably conclude that the Commissioner had or might have had a closed mind on whether corrupt conduct existed.

In these circumstances this ground of appeal also fails.

Conclusion

In the result, the appeal should be dismissed with costs.

BARRETT JA: I agree. The inquiry upon which the Commission is engaged is not some form of legal proceeding in which the State and elements of the executive are pitted against persons summoned for examination or the interests that those persons represent. The process is quite different. In the course of an inquiry, hypotheses are formed and subjected to continuous assessment. As evidence accumulates, suspicions and inferences are tested and refined. Some are confirmed, others are not. Hypotheses are likewise re-evaluated and re-shaped as the process continues. A series of possibilities may be considered and discarded during the course of a particular inquiry.

Given that context, the Commissioner's action in communicating as he did with the Minister for Planning was not such as to engender in the mind of a reasonable fair-minded observer an apprehension of predisposition towards any particular outcome of the Commission's inquiry. It was (and would have been seen to be) a step taken legitimately in the public interest to acquaint the Minister with the fact that future findings on matters under consideration by the Commission might be relevant to the exercise of the Minister's statutory functions. The Commissioner flagged no more than a possibility indicated by the then state of the inquiry's evolution.

Likewise, a reasonable fair-minded observer would not have inferred any such predisposition from the Commissioner's solicitation from the Premier of a request to extend the scope of the inquiry in a way that the Commissioner could himself have achieved in any event. The extension was no doubt made so that developing possibilities might be brought within the terms of reference. Whatever may have been the motivation for seeking the request, the desire of the Commissioner to have in advance some measure of government support or political cover for a course that he proposed taking did not imply anything but an open and inquiring mind in relation to the expanded subject matter of the investigation.

WARD JA: For the reasons articulated by the Chief Justice, I am not persuaded that Hoeben JA erred in holding that the test for apprehended bias set out in Ebner, and applied more recently in Michael Wilson Partners v Nicholls, was not satisfied in this case, whether that test be applied individually (to each of the matters by reference to which apprehended bias was alleged) or holistically (to the overall conduct of which complaint was made).

It is not disputed that what was required was that the applicant firmly establish that a fair-minded lay observer, having regard to the conduct identified by the applicant, might reasonably apprehend that the Commissioner might have a closed mind or might not be open to persuasion on the relevant issue or issues for determination by the Commissioner.

While the "double might" test for apprehended bias does not require that prejudgment (or a closed mind) be the inevitable conclusion that a fair-minded lay observer might reasonably reach, it does require that there be a logical or rational connection between the matter that is said might reasonably give rise to an apprehension of bias in the mind of such an observer and the matter in respect of which it is apprehended that the decision-maker might be biased.

In the present case, the relevant "matter" identified for the purpose of considering whether there was the requisite logical connection was as to the circumstances surrounding the issue of the exploration licence in question (namely, whether it was procured by corruption involving the relevant Minister and whether the applicant and his associates were to have been object of benefit of any such corrupt conduct).

The context in which the relevant events occurred has been set out in Bathurst CJ's reasons. As to the question whether the possibility of a perception of bias was one that was rationally open on the evidence, emphasis was placed by the applicant on matters such as the contrast between the Commissioner's public statements (including as to the transparency of his conduct in relation to the request for advice) and the lack of disclosure or "apparent lack of frankness" in relation to the communications between the Commissioner and members of the executive, as indicating that it might reasonably be perceived that the Commissioner might have a closed mind or might have pre-judged the relevant matter (i.e., whether there had been corrupt conduct in the grant of the licence to the benefit of the applicant or his associates).

Mr Hutley SC submits that the statements that were made publicly by the Commissioner must be weighed against the entirety of his conduct, including: that there was no public disclosure of the initial communications that led to the (apparently unsolicited) request by the executive to expand the scope of the Commissioner's investigation; the non-disclosure of the circumstances in which the request for advice as to planning matters was received (namely that certain advice had already been given by the Commissioner in that regard); and the statement as to the transparency of the process without disclosure of all of the communications that had taken place.

Mr Walker SC, appearing for the Attorney, emphasised the distinction between the investigation being carried out by the Commissioner and what might or might not be decided by the relevant Minister in relation to the application for development consent. In other words, whether or not the Commissioner had formed a view as to whether a decision should be made (or should be deferred) on the application for development consent pending the conclusion of his enquiry into the circumstances in which the mining licence had been granted, is not to the point. The relevant matter about which the possibility of a closed mind (and the reasonableness of an apprehension of bias) is to be tested is whether the award of a exploration licence to a company associated with the applicant was tainted by corrupt conduct of which the applicant may obtain a benefit.

I am not persuaded that there is a logical connection between the question as to what matters could be taken into account as an administrative matter on the application for development consent and the decision before the Commissioner such as to permit the conclusion that a fair-minded lay observer might reasonably conclude, from the Commissioner's conduct (taken individually or collectively) that the Commissioner might not have an open mind as to the latter.

The formation of a preliminary or provisional view as to the possibility that the evidence might sustain a finding that could be of relevance to a subsequent decision whether to grant development consent is not a sufficiently cogent basis for a fair minded observer rationally to consider that the Commissioner might not have an open mind as to the issues being investigated in relation to corrupt conduct in the grant of the exploration licence. Nor does the fact that the Commissioner appears to have taken the initiative in suggesting that the investigation be expanded or in suggesting that advice might be obtained as to the avenues available to defer the making of particular administrative decisions until after the conclusion of the enquiry provide such a basis.

As to the inconsistency perceived in the statements by the Commissioner as to transparency of process and the non-disclosure of other steps that were taken in relation to the issues about which the Commissioner was inviting submissions, and the non-disclosure of the fact that the suggestion for an expansion of the enquiry emanated from the Commissioner and not the government, again those matters do not in my view have a sufficient rational connection to the decision that the Commissioner must make in relation to the circumstances in which the exploration licence was granted to satisfy the onus on the applicant firmly to establish the apprehension of bias. Speculation as to the reasons for the approach adopted by the Commissioner in this regard is unhelpful.

I agree with the reasons of Bathurst CJ and the orders proposed by his Honour.

**********

Amendments

27 June 2013 - typographical error

Amended paragraphs: 130

Decision last updated: 27 June 2013

Medium Neutral Citation:	Duncan v Ipp [2013] NSWCA 189
Hearing dates:	8 May 2013
Decision date:	25 June 2013
Before:	Bathurst CJ at [1]; Barrett JA at [217]; Ward JA at [220]
Decision:	1. Leave to appeal granted 2. Appeal dismissed with costs [Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
Catchwords:	ADMINISTRATIVE LAW - apprehended bias - pre-judgment - Independent Commission Against Corruption (ICAC) - conduct of the Commissioner of the ICAC. ADMINISTRATIVE LAW - apprehended bias - pre-judgment - conduct of the ICAC Commissioner - test for reasonable apprehension of bias - application of test to investigatory body - scope of Independent Commission Against Corruption Act 1988. ADMINISTRATIVE LAW - apprehended bias - pre-judgment - conduct of the ICAC Commissioner - test for apprehended bias - Ebner v Official Trustee in Bankruptcy [2000] HCA 63; (2000) 205 CLR 337 - whether there was a logical connection between the conduct of the Commissioner and the alleged apprehended bias. ADMINISTRATIVE LAW - apprehended bias - pre-judgment - conduct of the ICAC Commissioner - whether contact between the Commissioner, the Executive and Government Departments, advice provided by the Commissioner and the circumstances of providing such advice either separately or holistically established apprehended bias.
Legislation Cited:	Environmental Planning and Assessment Act 1979 Pt 3A, s 75V Independent Commission Against Corruption Act 1988, s 2A, s 10, s 12, s 13, s 14, s 16, s 17, s 20, s 30, s 31, s 53, s 73, s 74, s 111, Schedule 1
Cases Cited:	Antoun v The Queen [2006] HCA 2; (2006) 80 ALJR 497 Concrete Pty Ltd v Parramatta Design & Developments Pty Ltd [2006] HCA 55; (2006) 229 CLR 577 Ebner v Official Trustee in Bankruptcy [2000] HCA 63; (2000) 205 CLR 337 Hot Holdings Pty Ltd v Creasy [2002] HCA 51; (2002) 210 CLR 438 Johnson v Johnson [2000] HCA 48; (2000) 201 CLR 488 Livesey v NSW Bar Association [1983] HCA 17; (1983) 151 CLR 288 McGovern v Ku-ring-gai Council [2008] NSWCA 209; (2008) 72 NSWLR 504 Michael Wilson & Partners Ltd v Nicholls [2011] HCA 48; (2011) 244 CLR 427 Minister for Immigration and Multicultural Affairs; Ex parte Epeabaka [2001] HCA 23; (2001) 206 CLR 128 Minister for Immigration and Multicultural Affairs v Jia Legeng [2001] HCA 17; (2001) 205 CLR 507 R v Commonwealth Conciliation and Arbitration Commission; Ex parte Angliss Group (1969) 122 CLR 546 R v Lusink; Ex parte Shaw (1980) 32 ALR 47 Vakauta v Kelly [1989] HCA 44; (1989) 167 CLR 568
Category:	Principal judgment
Parties:	Travers William Duncan (applicant)The Honourable David Andrew Ipp AO QC (first respondent)Independent Commission Against Corruption (second respondent)Attorney General of NSW (third respondent)
Representation:	Counsel: N Hutley SC and G Ng (applicant)Submitting Appearance (first and second respondents)B Walker SC and S Free (third respondent) Solicitors: Yeldham Price O'Brien Lusk (applicant)I V Knight, Crown Solicitor (NSW) (first, second and third respondents)
File Number(s):	2013/111103
Publication restriction:	No
Decision under appeal	Jurisdiction: 9111 Citation: [2013] NSWSC 314 Date of Decision: 2013-04-10 00:00:00 Before: Hoeben CJ at CL File Number(s): 2013/68363