Field & Kingston
[2018] FamCAFC 145
•7 August 2018
FAMILY COURT OF AUSTRALIA
| FIELD & KINGSTON | [2018] FamCAFC 145 |
| FAMILY LAW – APPEAL – EVIDENCE – Privilege – Where the wife sought a certificate pursuant to s 128 of the Evidence Act1995 (Cth) (“the Evidence Act”) in relation to the wife’s proposed evidence in chief – Where the primary judge dismissed the application on the basis that there was insufficient evidence to determine whether the wife had reasonable grounds for objecting to giving the evidence. FAMILY LAW – APPEAL – EVIDENCE – Compellability – Where a witness must be “required” or compelled to give the evidence to which the objection is made – No distinction between oral and affidavit evidence – Whether the duty to give full and frank disclosure under the Family Law Rules 2004 (Cth) (“the Rules”) compels a party to give evidence which may abrogate from the privilege against self-incrimination – The Rules as per the “principle of legality” evince no intention to impinge on a party’s privilege against self-incrimination – Preliminary view that if a party is directed to file an affidavit on a specific subject matter, such circumstances may contain the requisite degree of compulsion to permit the issuing of a certificate – Where there is no basis on which the certificate could have been granted to the wife in this case as the element of compulsion was lacking. FAMILY LAW – APPEAL – EVIDENCE – Reasonable grounds for making an objection – Where the “objection” under s 128(2) of the Evidence Act refers to giving evidence that “may tend” to prove that the witness has committed an offence or is liable to a civil penalty – Where the primary judge took the view that in order for a s 128 certificate to be granted the wife had to provide to the court the evidence that was objected to – Where the primary judge erred by focussing on identifying the evidence as opposed to considering whether there were reasonable grounds for the wife’s objection – Where the primary judge was nevertheless correct in refusing to grant a s 128 certificate as it was not available for the wife’s proposed evidence in chief – Appeal dismissed. FAMILY LAW – APPEAL – LEAVE TO APPEAL – Where the order dismissing the wife’s application did not finally determine her rights in relation to a s 128 certificate – Where leave to appeal is therefore necessary. |
| Evidence Act 1995 (Cth) s 128 Australian Law Reform Commission, Uniform Evidence Law, Report No 102 (2005) |
| Accident Insurance Mutual Holdings Ltd v McFadden (1993) 31 NSWLR 412 Attorney-General (SA) v Corporation of the City of Adelaide (2013) 249 CLR 1; [2013] HCA 3 Carr v Finance Corporation of Australia Ltd (1981) 147 CLR 246 Chao v Chao [2008] NSWSC 584 Construction, Forestry, Mining and Energy Union v Australian Building and Construction Commissioner (2018) 351 ALR 168; [2018] FCAFC 4 Cornwellv The Queen (2007) 231 CLR 260; [2007] HCA 12 Crawford v Crawford(No 3) [2016] NSWSC 704 Ferrall v Blyton; Attorney-General of the Commonwealth (Intervener) (2000) FLC 93-054; [2000] FamCA 1442 Gould and Gould (2007) FLC 93-333; [2007] FamCA 609 Harrington v Lowe (1996) 190 CLR 311; [1996] HCA 8 Kannis and Kannis (2003) FLC 93-135 Licul v Corney (1976) 180 CLR 213 Meiko Australia Pacific Pty Ltd v Hinchliffe [2009] NSWSC 354 Oriolo and Oriolo (1985) FLC 91-653 Reid v Howard (1995) 184 CLR 1; [1995] HCA 40 Ross v Internet Wines Pty Ltd (2004) 60 NSWLR 436; [2004] NSWCA 195 Sheikholeslami v Tolcher (2009) 75 NSWLR 418; [2009] NSWSC 920 Song v Ying (2010) 79 NSWLR 442; [2010] NSWCA 237 Sorby v The Commonwealth (1983) 152 CLR 281; [1983] HCA 10 Vaughan Constructions Pty Ltd v Luong [2008] NSWSC 1033 Weir and Weir (1993) FLC 92-338 |
| APPELLANT: | Ms Field |
| RESPONDENT: | Mr Kingston |
| FILE NUMBER: | PAC | 2095 | of | 2014 |
| APPEAL NUMBER: | EA | 42 | of | 2017 |
| DATE DELIVERED: | 7 August 2018 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Strickland, Ainslie-Wallace & Aldridge JJ |
| HEARING DATE: | 19 February 2018 |
| LOWER COURT JURISDICTION: | Family Court of Australia |
| LOWER COURT JUDGMENT DATE: | 7 April 2017 |
| LOWER COURT MNC: | [2017] FamCA 208 |
REPRESENTATION
| COUNSEL FOR THE APPELLANT: | Jonathon Priestley SC |
| SOLICITOR FOR THE APPELLANT: | Matthews Folbigg Pty Ltd |
| THE RESPONDENT: | In person |
Orders
The wife be granted leave to appeal.
The appeal be dismissed.
There be no order as to costs.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Field & Kingston has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT SYDNEY |
Appeal Number: EA 42 of 2017
File Number: PAC 2095 of 2014
| Ms Field |
Appellant
And
| Mr Kingston |
Respondent
REASONS FOR JUDGMENT
By Amended Notice of Appeal filed on 24 May 2017, Ms Field (“the wife”) seeks leave, and if leave is granted, to appeal from the dismissal of an application by Hannam J on 7 April 2017 that a certificate be granted to her pursuant to s 128 of the Evidence Act 1995 (Cth) (“the Evidence Act”). The certificate was sought in relation to the wife’s proposed evidence in chief.
The husband and wife are engaged in property settlement proceedings which were commenced by the wife in May 2015.
In 2016 the wife applied for a number of financial orders including provision for her future costs and for the payment of a lump sum to her in advance of the hearing of the property settlement proceedings.
In his response to that application, the husband contended that the wife had failed to make full and frank disclosure of her financial position.
The wife then applied for a certificate pursuant to s 128 of the Evidence Act on the basis that she wished to respond to the husband’s allegations but sought the issue of the certificate in relation to her evidence about “these matters”. She concluded by deposing that if a certificate was granted she would file a further affidavit and a further financial statement which answered the husband’s allegations against her.
The wife’s application was dismissed on the basis that the primary judge concluded that the wife had failed to provide sufficient evidence to enable the court to determine whether there were reasonable grounds for objecting to giving the evidence.
Leave to Appeal
The wife seeks leave to appeal, and relies on the success of her proposed grounds of appeal as justifying the granting of leave.
Whether leave to appeal is required is not always easy to determine, but here leave is required because the order of the primary judge was interlocutory, as it was neither final, not dispositive of the rights of the parties (Licul v Corney (1976) 180 CLR 213 at 220; Carr v Finance Corporation of Australia Ltd (1981) 147 CLR 246 at 248).
Given the right circumstances, as a matter of law, the wife could make another application for a s 128 certificate.
The husband opposes the application for leave to appeal, but in effect he does so on the basis of what he says is lack of merit in any of the proposed grounds of appeal.
However, as will be seen, we propose to determine this matter on a basis other than contained in the grounds of appeal, and because the issues are of some importance and involve competing intermediate appeal court authorities, we consider it appropriate to grant leave.
The only issue agitated on the appeal concerned her Honour’s refusal to grant a
s 128 certificate for the wife’s anticipated evidence in chief. The wife challenged the primary judge’s conclusion about whether there were reasonable grounds for objecting to giving the evidence.
The husband appeared without legal representation on the appeal and took a neutral position, making no submissions either for or against the appeal.
During the appeal hearing, the Full Court brought the authority of Construction, Forestry, Mining and Energy Union v Australian Building and Construction Commissioner (2018) 351 ALR 168 (“CFMEU”) to the attention of senior counsel for the wife; the issue raised by that authority is whether a certificate pursuant to s 128 is available in relation to the evidence in chief of a witness. The Full Court there determined, in effect, that a s 128 certificate is only available to a witness giving evidence in chief if the witness is required or compelled to give that evidence. Given that this point had not been raised at trial we invited further submissions on the issue, and written submissions were subsequently provided by counsel for the wife. The husband did not make further submissions.
We thus propose to consider whether a s 128 certificate can apply to evidence to be given in chief in family law proceedings.
Section 128
Section 128 of the Evidence Act states:
128Privilege in respect of self‑incrimination in other proceedings
(1) This section applies if a witness objects to giving particular evidence, or evidence on a particular matter, on the ground that the evidence may tend to prove that the witness:
(a)has committed an offence against or arising under an Australian law or a law of a foreign country; or
(b)is liable to a civil penalty.
(2)The court must determine whether or not there are reasonable grounds for the objection.
(3)Subject to subsection (4), if the court determines that there are reasonable grounds for the objection, the court is not to require the witness to give the evidence, and is to inform the witness:
(a)that the witness need not give the evidence unless required by the court to do so under subsection (4); and
(b)that the court will give a certificate under this section if:
(i)the witness willingly gives the evidence without being required to do so under subsection (4); or
(ii) the witness gives the evidence after being required to do so under subsection (4); and
(c)of the effect of such a certificate.
(4)The court may require the witness to give the evidence if the court is satisfied that:
(a)the evidence does not tend to prove that the witness has committed an offence against or arising under, or is liable to a civil penalty under, a law of a foreign country; and
(b)the interests of justice require that the witness give the evidence.
(5)If the witness either willingly gives the evidence without being required to do so under subsection (4), or gives it after being required to do so under that subsection, the court must cause the witness to be given a certificate under this section in respect of the evidence.
(6)The court is also to cause a witness to be given a certificate under this section if:
(a) the objection has been overruled; and
(b)after the evidence has been given, the court finds that there were reasonable grounds for the objection.
…
Section 128(1) A witness “objects” to giving evidence
To “object” to giving evidence, in the sense relevant to s 128(1) of the Evidence Act, means more than being disinclined to give the evidence. As the authorities demonstrate, the objection is to being “required” or “compelled” to give evidence which may tend to incriminate the witness. This is to be contrasted with a witness seeking the protection of a s 128 certificate for evidence in chief in order to gain a forensic or tactical advantage as to how the evidence is adduced.
In Cornwell v The Queen (2007) 231 CLR 260 (“Cornwell”), Cornwell was standing trial on a charge of conspiracy to import cocaine into Australia. The Crown had led, and the trial judge admitted, evidence of conversations between Cornwell and two alleged co-conspirators. Cornwell wished to give evidence to explain the conversations and to rebut the inference that the Crown sought to be drawn from those conversations. However, he contended that he could only give that evidence if he was provided with the protection of a s 128 certificate. The foreshadowed application was made at a point in his examination in chief when his counsel came to the subject matter of the taped conversations; Cornwell then “objected” to the questions and sought the issue of a certificate. A certificate was granted.
Cornwell was convicted and appealed. The Crown also appealed, challenging the order granting the certificate. The Crown’s appeal was dismissed by the New South Wales Court of Criminal Appeal. The Crown then appealed to the High Court of Australia.
On the appeal, the plurality (Gleeson CJ, Gummow, Heydon and Crennan JJ) said as to Cornwell’s “objection”:
106. … A fair characterisation of the exchanges between counsel for the accused and Howie J set out earlier is that while in one sense the accused “objected” to the thirty-fifth question he was asked in chief when he claimed privilege, in another sense he did not object at all. He evidently wanted to give some evidence about the Diez-Lawrence conversations. He could only be sure of giving it in the way he would have liked if he gave it in chief; if he took the risk of leaving its reception to the chance of particular questions in cross-examination, he ran the risk of not being able to give it, or not in the way perceived to be the most favourable to his interests. Hence his claim of privilege was arguably not a means by which he “objected”, but was an attempt to ensure that s 128 protected him from some potentially adverse consequences of evidence which he did not “object” to giving, but strongly wanted to give.
(Footnotes omitted) (Emphasis added)
As to the meaning of the word “object” in the context of s 128 the plurality said:
112. The view that the accused's claim of privilege in all the circumstances answered the requirements of s 128(1) has difficulties. It strains the word “objects” in s 128(1). It also strains the word “require” in s 128(5) – for how can it be said that a defendant-witness is being “required” to give some evidence when his counsel has laid the ground for manoeuvres to ensure that the defendant-witness’s desire to give the evidence is fulfilled? ...
Thus before a s 128 certificate can be sought, the witness must be “required” or “compelled” to give the objected to evidence. That issue was further considered in Song v Ying (2010) 79 NSWLR 442 (“Song”) where Hodgson JA (with whom Giles and Basten JJA agreed) said:
20. Plainly, in my opinion, if a witness gives evidence in chief because actually compelled to do so (by subpoena and threat of imprisonment), or because of the availability of such compulsion if he or she does not do so, there is no reason why that witness may not object to giving evidence in chief on the ground that that evidence may tend to incriminate. The question in my opinion is not whether the evidence is given in chief or in cross-examination, but rather whether an objection under s 128 is limited to an objection to giving evidence which the witness would otherwise be compellable to give.
Hodgson JA concluded (again, with the concurrence of Giles and Basten JJA):
26. In my opinion, it is appropriate to construe s 128 against a background of the common law, where privilege against
self-incrimination was relevantly a privilege against being compelled to give evidence that might tend to incriminate; and also against a statutory framework in which witnesses are generally compellable to give evidence. A party giving evidence in chief, in response to questions from that party’s own legal representative, is not generally giving evidence which that party is, in any real sense, compellable to give: unless called by another party and asked questions in chief by that other party, a party’s evidence in chief is given entirely at the choice of that party and is not evidence that the party is compellable to give at the instance of anyone else. It is true that a party’s legal representative can ask questions in chief without specific instructions to ask them; but if the party instructed the representative to withdraw such a question, there would in my opinion be no possibility of the witness being compelled to answer the question, at least unless it was pressed by another party or the judge, in which case no doubt s 128 could apply.27. In all cases apart from a party giving evidence in chief or
re-examination in response to questions from the party’s own legal representative, witnesses are compellable to give evidence either at the instance of the party calling them, or the party directing questions in cross-examination, or the judge (if the judge asks questions.) It is compellability of this nature that gives sense to the word “objects” in s 128(1) and makes sense of the word “require” in s 128(4). …Thus while a s 128 certificate can be available in relation to a witness’s evidence in chief, the legal foundation for the granting of a certificate lies in the witness being compelled to give the evidence which the witness fears may tend to prove that he or she has committed an offence or tend to render him or her liable to a civil penalty. Merely because it would be forensically or tactically advantageous for him to give the evidence with the protection of a certificate is insufficient to found an application pursuant to s 128.
Any doubt as to the correctness of that proposition was dispelled by the decision in CFMEU. In that case, the Commissioner sought remedies against Mr McDonald for breach of certain provisions of the Fair Work Act 2009 (Cth). Section 361 of that Act presumed that McDonald acted for particular reasons or with particular intent unless he proved otherwise. He therefore contended that his evidence in chief addressed to that proof was an exception to the rule in Song and that a certificate could issue in respect of that evidence. The Court considered that Song was correctly decided, aided by the observations of the High Court in Cornwell, and that McDonald was not entitled to a certificate as the necessary element of compulsion was lacking.
The availability of a s 128 certificate for a witness compelled to give evidence in chief was discussed in Ross v Internet Wines Pty Ltd (2004) 60 NSWLR 436 (“Internet Wines”). That case concerned an order made compelling a party to give specific evidence. The applicant sought freezing orders in relation to accounts said to contain funds wrongfully removed by Ross from the applicant company. The court made a suite of orders which included an order that Ross swear an affidavit disclosing and identifying all funds removed by him from the relevant bank accounts. The orders, clearly contemplating that the evidence may tend to incriminate Ross, further provided that if Ross wished to make a claim for privilege against self-incrimination in relation to the affidavit he was ordered to swear, he must deliver to the primary judge’s associate the sworn affidavit as ordered together with an affidavit supporting the claim to privilege with the intention that the documents would be inspected by the primary judge who would then assess the claim of privilege. Ross appealed.
In allowing the appeal, the New South Wales Court of Appeal considered the effect of the ordered disclosure on a claim for privilege against self-incrimination and concluded that the order to make disclosure had the effect of compelling Ross to give evidence but by requiring the delivery of the affidavit in advance of making a claim to privilege, the orders had infringed the privilege against self-incrimination. Giles JA said:
101. … But by compliance with the obligation [to swear the affidavit] his fundamental common law right would already be infringed. In order to have his claim to privilege determined, he would have to disclose the material which he said was incriminatory and should not be disclosed. There would be offence to the principle underlying the observation of Lord Denning MR in Rio Tinto Zinc Corporation v Westinghouse Electric Corporation [1978] AC 547 at 574, that a witness “should not be compelled to go into detail – because that may involve his disclosing the very matter to which he takes objection”. See also Accident Insurance Mutual Holdings Ltd v McFadden (at 447 [90] supra) stating that the court will determine a claim to privilege “without requiring the witness fully to explain how the effect would be produced, for if it were necessary, the protection which the rule is designed to afford the witness would be annihilated”.
102. If the information in the disclosure affidavit tended to incriminate the appellant, he was imperilled because he had brought into existence an incriminatory document: the respondents’ acceptance of infringement if it had been found that whatever was in the disclosure affidavit would infringe the appellant’s privilege recognised the peril. The respondents submitted that the appellant was no more imperilled than a person who was ordered by subpoena to produce a document at court, the order being good and the claim to privilege being made at the time appointed for production. But that is different. The appellant was compelled to make a document which did not previously exist, and no longer had control of the document after its delivery to the judge’s associate: all this without any s 128 certificate.
(Emphasis added)
Oral or affidavit evidence
Clearly, then where the requisite element of compulsion exists, a s 128 certificate may be available for a witness’s evidence in chief. There appears to be no relevant distinction to be drawn as to the form in which the evidence is given, that is whether given orally or by affidavit sworn and filed in the proceedings. The Law Reform Commission report (Law Reform Commission, Evidence (Final), Report No 38 (1987)), which presaged the Evidence Act, made no such distinction. Nor did the Australian Law Reform Commission report of 2005 that reviewed the Evidence Act (Australian Law Reform Commission, Uniform Evidence Law, Report No 102 (2005)). Although not directly adverted to in the decisions, applications for certificates have been considered both when the evidence was to be given orally and by affidavit (see Chao v Chao [2008] NSWSC 584; Sheikholeslami v Tolcher (2009) 75 NSWLR 418 and also Song at [20]).
In Ferrall v Blyton; Attorney-General of the Commonwealth (Intervener) (2000) FLC 93-054 (“Ferrall”) at [90] the Full Court considered there to be no difference between an objection taken during the giving of oral evidence and to evidence given in an affidavit, and a certificate was granted in respect of evidence in chief to be given on affidavit. However, as will later be apparent, in our view, the decision in Ferrall should no longer be followed.
Thus the foundation for the granting of a s 128 certificate lies not in the manner in which the evidence is to be given but in the witness being compelled to give the evidence.
Compulsion and the requirement of full and frank disclosure in the Family Court
Senior counsel for the wife in his further submissions contended that compulsion in the relevant sense arises in relation to evidence in chief in the Family Court by reason of the operation of the Family Law Rules 2004 (Cth) (“the Rules”) and the “well recognised duty of disclosure”.
There is no doubt that rr 13.01 to 13.06, which appear in Chapter 13, Part 13.1 of the Rules impose an obligation of full and frank disclosure between parties and expresses the duty to encompass disclosure of financial circumstances, production of documents and answers to specific questions.
In the event that there is a failure to comply with the obligation to disclose, “then the Court should not be unduly cautious about making findings in favour of the innocent party. To do otherwise might be thought to provide a charter for fraud in proceedings of this nature” (Weir and Weir (1993) FLC 92-338 at 79,593; see also Oriolo and Oriolo (1985) FLC 91-653; Gould and Gould (2007) FLC 93-333; Kannis and Kannis (2003) FLC 93-135).
The issue then is whether rr 13.01 to 13.06 compel a party to give evidence which may be the subject of a claim of privilege.
Before deciding whether the operation of the Rule does indeed provide the relevant compulsion, it is useful to consider the nature of the privilege itself. In Accident Insurance Mutual Holdings Ltd v McFadden (1993) 31 NSWLR 412 (“Accident Insurance”) Kirby P said at 421, after observing at 420 that the right is “fundamental to a civilised legal system”:
The principle is rooted deep in the resistance of our system of law to obliging a person to convict himself or herself by that person’s own testimony. Such a person has ordinarily a right to remain silent in the face of an accusation of a crime or wrongdoing. To the extent that the privilege against self-incrimination is eroded, so are attributes of freedom conventionally regarded as important.
(Citations omitted)
In a similar vein, the High Court, Toohey, Guadron, McHugh and Gummow JJ, in Reid v Howard (1995) 184 CLR 1 (“Reid v Howard”) said at 11:
[I]t is appropriate to state that the Court of Appeal was correct in its conclusion that the appellant is entitled to make and maintain his claim of privilege and to indicate why that is so. The privilege, which has been described as a “fundamental … bulwark of liberty”, is not simply a rule of evidence, but a basic and substantive common law right. It developed after the abolition of the Star Chamber by the Long Parliament in 1641, …
(Footnotes omitted)
The court continued at 14
There is simply no scope for an exception to the privilege, other than by statute. … For the same reason, there can be no exception in civil proceedings, whether generally or of one kind or another. Moreover, it would be anomalous to allow that a person could refuse to answer questions in criminal proceedings or before investigative bodies where the privilege has not been abrogated if that person could be compelled to answer interrogatories or otherwise make disclosure with respect to the same matter in civil proceedings.
Turning then to Part 13.1 of the Rules, rr 13.01 to 13.06 cannot have the effect for which the wife contended, namely, to compel a party to give evidence which may impinge on or abrogate from that party’s privilege against self-incrimination. That is so, first because, if that was the intention of the rule, it would have to be expressed in clear words according to the “principle of legality”. In Attorney-General (SA) v Corporation of the City of Adelaide (2013) 249 CLR 1 at 66 Heydon J described the principle thus:
148 The “principle of legality” holds that in the absence of clear words or necessary implication the courts will not interpret legislation as abrogating or contracting fundamental rights or freedoms. For that principle there are many authorities, ancient and modern, Australian and non-Australian. The principle exists for good reason. As Lord Hoffmann said:
“[T]he principle of legality means that Parliament must squarely confront what it is doing and accept the political cost. Fundamental rights cannot be overridden by general or ambiguous words. This is because there is too great a risk that the full implications of their unqualified meaning may have passed unnoticed in the democratic process.”
(Footnote omitted)
Heydon J continued and said:
150 The principle of legality can apply both to parliamentary legislation creating a power to make delegated legislation, and to the delegated legislation itself. The consequence of applying the principle of legality to a power in parliamentary legislation to make delegated legislation will tend to be a relatively narrow construction of that power. And the consequence of applying the principle of legality to delegated legislation made under that power will tend to be a relatively narrow construction of that delegated legislation. Here, the crucial issue is the impact of the principle of legality on the width of the s 667(1)(9)(XVI) and s 667(1)(4)(I) powers to make delegated legislation. That is because though the words of the challenged clauses are wide, and though they create criminal offences, they are on the whole clear enough, at least in their application to the second and third respondents, to prevent the principle of legality from causing difficulty in relation to them.
Clearly then, for the Rules to operate so as to abrogate or impinge on the privilege against self-incrimination, that intention must be clear from the terms of the Rule, and, plainly that is not the case.
Secondly, the Rules are made by the judges of the Court in reliance on the rule-making power conferred by s 123 of the Family Law Act 1975 (Cth) (“the Act”), which power is expressed as a power limited to making rules in relation to practice and procedure to be followed in the Family Court and in relation to things incidental to such practice and procedure.
The power conferred by s 123 to make rules, while broad, does not authorise the making of rules which vary or depart from positive provisions of the Act (Harrington v Lowe (1996) 190 CLR 311 at 324 – 325 per Brennan CJ, Dawson, Toohey, Gaudron, McHugh and Gummow JJ). Nor can the rule making power be used to alter substantive rights as described by Kirby J later in that judgment at 341 – 342:
…
2. In any case, the sole grant of power which supports the subject rule is one confined to matters “in relation to the practice and procedure to be followed in the Family Court”. That compendious phrase has conventionally been given a broad operation. Especially in the context of a power to make rules, to cover the multitude of subsidiary matters which can arise in the operation of a court with a complex jurisdiction, the phrase should not be narrowly construed. Nor should what is “practice and procedure” be fixed in time so that court proceedings are unable to adapt to new community needs and different techniques of judicial administration. But in the end, a point will be reached where a rule-maker will exceed the boundaries of permissible rule-making on matters in relation to “practice and procedure” and intrude into rule-making with respect to the substantive rights of the parties. … The task of a court is to characterise a rule which is challenged on the ground that it has exceeded the legislative grant of power. Such a rule may exhibit the appearance of having a dual character: pertaining in some ways to procedural matters but in other way having an effect on substantive rights. … The purpose of the classification here must be kept in mind if it is to be accurately performed. That purpose, relevantly, is to decide whether the subject matter of the challenged rule is no more than a procedural pre-condition to the enjoyment of rights judicially recognised or an abrogation of substantive rights, beyond the power of the subordinate law-maker. The mere fact that a procedural rule has effect upon substantive rights is not enough to strip it of its procedural character. But if the rule goes beyond the provision of the means by which substantive rights are to be enforced or protected, the decision-maker will be entitled to conclude that what has been done, under the guise of a procedural rule, is, in fact, impermissibly to alter substantive rights. By law, that is forbidden to the rule-maker. It is reserved to those with the power to alter substantive rights. This means principally a legislature, the Executive acting under delegated power clearly conferred or judges acting in the time-honoured fashion of the common law. It is not to be done in a quasi-legislative way by rule-making.
(Footnotes omitted)
We are therefore unable to accept the contention that the Rules operate to interfere with a substantive right such as that against self-incrimination, and, indeed, if they intended to do so they would have to express that intention in clear terms. Thus, we conclude that the operation of the Rules provide no relevant compulsion in the sense which would enliven the application of s 128 of the Evidence Act.
However, where a party is directed to file an affidavit and the order specifies the subject matter of the affidavit, the requisite degree of compulsion may well arise permitting the issue of a certificate, for as we have said, it is being compelled to give the evidence which enlivens the privilege, not the means by which the compulsion arises (see Crawford v Crawford(No 3) [2016] NSWSC 704).
Thus we turn to Ferrall. In that case, the Full Court held that a certificate was available in relation to proposed evidence in chief, accepting the arguments of counsel for the respondent that nothing in s 128 limited its operation to cross-examination and it extended to where a witness “objects to giving the evidence at all” at [85]. The Full Court concluded:
89. We think the trial Judge was clearly correct in holding that it was within his discretion to grant such a certificate. First, we think it would be unrealistic to limit the availability of a certificate to a situation where a witness is asked a particular question in cross-examination. We think the availability of a certificate clearly applies to evidence given in chief, otherwise an inappropriate forensic advantage would rest with the other party who would be in a position to prevent the question of an objection arising by simply not seeking to cross-examine.
In light of Cornwell and subsequent authorities, we agree with the conclusion in CFMEU at [47] that the decision of the Full Court cannot be correct and Ferrall should not now be followed. We note however that in Ferrall the issue of “compulsion” to give the evidence was not raised in argument and thus not considered by the Full Court.
We therefore conclude that in this case, there was no basis on which a certificate could have been granted in relation to the wife’s proposed evidence in chief because the necessary element of compulsion was lacking. She had not been ordered to give the evidence, nothing in the Rules “required” her to give it in infringement of her right against self-incrimination and she could, as she had thus far, decline to give evidence in relation to the allegations raised by the husband.
Although this disposes of the appeal, we are of the view that we should still consider the challenge to her Honour’s conclusion that there was insufficient evidence to enable the court to determine whether there were reasonable grounds for the wife’s objection.
Reasonable grounds for making the objection
Section 128(2) provides that an objection having been taken to giving particular evidence, the “court must determine whether or not there are reasonable grounds for the objection”.
It is important to keep squarely in mind that the “objection” is to giving evidence that “may tend” to prove that the witness has committed an offence or is liable to a civil penalty.
The claimant does not have to prove on reasonable grounds that he or she has committed an offence or is liable to a civil penalty, but that the evidence “may tend” to show that.
In Accident Insurance Clarke JA said at 430 of the court’s determination of whether there are reasonable grounds for the claim:
Whether the answer may tend to incriminate the witness is a point which the court will determine, under all the circumstances of the case, as soon as the protection is claimed. It will do so without requiring the witness fully to explain how the effect would be produced, for if this were necessary, the protection which the rule is designed to afford to the witness would at once be annihilated. However, the mere statement by a witness that he believes the answer will tend to incriminate him will not suffice to protect him from answering when the other circumstances of the case are such as to induce the judge to believe that the answer would not really have that tendency.
(Citations omitted)
Nor may it be necessary for the claimant to provide evidence to support the claim of privilege where the “circumstances were obvious and sufficiently discernible” from the nature of the case against the claimant (see Meiko Australia Pacific Pty Ltd v Hinchliffe [2009] NSWSC 354 at [178], Internet Wines and Vaughan Constructions Pty Ltd v Luong [2008] NSWSC 1033).
It is in this legal context that we turn to consider the case before the primary judge.
The case before the primary judge
The property settlement proceedings between the parties were commenced in May 2015 by the wife. According to her Honour’s reasons, the property of the parties or either of them consisted of a house and a business owned and operated by the husband and another business owned and operated by the wife.
An order had been made that each business be valued and in June 2016 the parties appointed a single expert to conduct that valuation. The valuer requested certain documents and information from the wife in order to effect the valuation of her business.
On 22 January 2016 the wife filed an application seeking interim property orders. On 14 July 2016 the husband responded to that application opposing the orders sought, and in the affidavit he swore in support of the response, alleged that the wife had failed to make full and frank disclosure of her financial circumstances. His affidavit made detailed reference to attached documents such as company accounts and the wife’s credit card statements which he asserted supported his allegations.
The primary judge summarised the husband’s allegations against the wife, namely that her lifestyle as reflected in her expenditure was inconsistent with the financial losses of her business revealed in her business records ([12]). The husband further asserted that the wife may have sources of income other than she has disclosed ([13]).
Thus it was on 31 August 2016 that the wife sought the issue of a s 128 certificate. In her affidavit in support of that application she said:
3. By his affidavit sworn on 13 July 2016 and filed on 14 July 2016 the husband makes numerous allegations against me in relation to my financial disclosure. These allegations include the following:
(a) At [50] that there is a discrepancy between the business records of the business [Company C] (“CC”) produced by me and my level of expenditure in the period 30 June 2011 to 30 June 2013;
(b) At [51] that I have not revealed all of the income derived by [CC] and possibly have not disclosed income from sources other than [CC];
(c) At [57] and [60] – [63] that I have a substantial source of funding that I have not explained in respect of the financial year ending June 2014;
(d) At [64] – [101] that my income tax returns for the years 2005 to 2015 inclusive are inaccurate.
4. The husband has requested particulars in respect of the above matters. So far as I am able I wish to provide a response to the husband’s allegations and requests. I seek to do so by providing a further affidavit in relation to these matters. However, before doing so, I seek that the Court grant me a certificate under section 128 of the Evidence Act on the basis that it may be possible that the information I provide in that affidavit may tend to prove that I have committed an offence against or arising under an Australian law or am liable to a civil penalty.
5. I object to providing any further responses to any inquiries or requests of the husband, or to complying with my continuing obligation of disclosure, without my request for a certificate under section 128 of the Evidence Act being considered.
Her Honour rejected the application because she found that the wife had failed to provide the evidence on which the objection was taken so as to enable her Honour to determine whether the wife had reasonable grounds for taking the objection.
The appeal
It was contended that her Honour erred in finding that there was insufficient evidence on which she could determine that reasonable grounds existed; in finding it was necessary that the wife provide the actual evidence in respect of which the certificate was sought; and in failing to conclude on the basis of the evidence before her that there were reasonable grounds for the wife to seek the certificate.
The thrust of the grounds of appeal go to what is said to be her Honour’s erroneous interpretation of s 128(2), which led her to require satisfaction that the evidence if given “would prove” the wife had committed an offence.
Her Honour first identified at [21] the particular evidence to which the wife objected giving, that is, where the wife in her affidavit identified the allegations made against her by the husband and to which we have referred.
The primary judge noted that she asked the wife “to identify the evidence” she contended may tend to prove that she has committed an offence at [24]. It is here, that it is submitted her Honour erred.
During the submissions of senior counsel for the wife, her Honour remarked that before she could consider the issue of a certificate, she needed to know the evidence which the wife would give if a certificate was issued.[1] She later said “the nub of the matter is she has got to tell us what she is going to tell us. She has got to tell us what the certificate is in respect of”.[2] Her Honour later repeated that point noting that the wife was required to tell the court “the content of her evidence”.[3]
[1] Transcript 12 December 2016 page 3 line 3.
[2] Transcript 12 December 2016 page 13 lines 19 to 20.
[3] Transcript 12 December 2016 page 13 line 33.
It is thus clear that her Honour was of the view that before a certificate could be considered, the applicant must provide to the court the evidence to which objection would be taken. Indeed she said at the conclusion of the submissions:
HER HONOUR: But certainly the procedure that I’ve encountered in other cases – and I think it’s also reported in some of the case law – is to do exactly what [counsel for the husband] referred to, and that there be a draft affidavit and that it’s either unsigned or particularly unsigned.[4]
[4] Transcript 12 December 2016 page 28 lines 19 to 22.
Referring to the submissions of counsel for the husband her Honour said:
26. During the course of submissions the Court raised that the authorities indicate that the applicant for a certificate is required to identify the particular offences for which the applicant may be liable. Only then did the wife produce a draft certificate in respect of evidence provided in these proceedings “as that evidence may tend to prove that she has committed an offence under Division 2 of Part 3 of the Tax Administration Act 1953 (Cth), Division 4 of Part 7 of the Crimes Act 1900 (NSW) or Section 268.102 of the Criminal Code Schedule to the Criminal Code Act 1995 (Cth).”
27. Counsel for the husband objected to a section 128 certificate being granted in these terms on the basis that these terms are too broad.
28. Counsel for the husband further submitted that the usual procedure when making an application for a section 128 certificate is that the applicant provide to the court an unsigned or unfiled affidavit outlining the evidence to be given requiring the protection of the certificate. Such an affidavit is then considered by the court to determine whether the applicant has reasonable grounds for objecting to giving the evidence.
(Emphasis added)
The submissions of counsel to which her Honour referred at [26] and [28], are in our view unfortunately incorrect (see Reid v Howard and Internet Wines). However, her Honour accepted the submissions and said:
29. No further evidence in the form of a draft affidavit or otherwise, was provided by the wife even when the Court indicated a continuing difficulty in identifying how the wife’s evidence supported the contention that the information she would provide may tend to prove she had committed an offence.
Her Honour said in reference to the wife’s affidavit then before the court in which she set out the general evidence or area of evidence to which she proposed to object:
36. Those statements amount to the wife merely declining to provide the relevant information on the ground that “it may be possible” that the information may incriminate her and do not provide sufficient evidence for me to determine whether there are reasonable grounds for the wife objecting to providing the evidence.
Her Honour continued:
38. The wife has not, in evidence before this Court, disclosed to any regulatory body that she has committed any offences, nor has she provided documentation in the form of updated income tax assessments or otherwise that would provide an indication of the information that may tend to prove she is liable for an offence or subject to a civil penalty.
39. She has also provided only a broad indication of sections of three pieces of legislation under which she may be liable for any number of offences (which are not specified).
40. In my view, the wife in this application has provided so little evidence that I cannot even engage with an assessment of whether she has reasonable grounds to object to providing the particulars sought by the husband.
41. At this time, the wife, even given significant latitude, has not produced sufficient information for me to determine whether the evidence she objects to providing may tend to prove she has committed an offence under Australian law or is liable to a civil penalty. Accordingly, there is no evidence upon which I can assess whether there are reasonable grounds for such an objection.
Returning then to the appeal, we agree with the submissions of senior counsel for the wife that her Honour, rather than consider whether there were reasonable grounds for the wife making the objection, misdirected her consideration by requiring the wife to “identify the evidence” which she claimed may tend to incriminate her.
Her Honour erred because she was requiring proof of the commission of the offence rather than assessing whether “from the circumstances of the case and the nature of the evidence which the witness is called to give, that there is reasonable ground to apprehend danger to the witness from his being compelled to answer” (Sorby v The Commonwealth (1983) 152 CLR 281 at 289 per Gibbs CJ).
Further, it seems that in determining the issue of whether reasonable grounds existed to make the objection, her Honour restricted her consideration to the wife’s evidence and did not consider it in light of the husband’s affidavit evidence. Here, her Honour had before her the husband’s affidavit in which he detailed the allegations against the wife and which were said to be supported by the documents attached to that affidavit. Her Honour further had before her the wife’s affidavit identifying by reference to the husband’s allegations the particular evidence in respect of which she objected to giving evidence. Had her Honour not restricted her consideration of this issue to the wife’s evidence, the husband’s documents may well have assisted the resolution of this issue.
Be that as it may, her Honour applied an incorrect test and her consideration of whether the wife had established reasonable grounds for objecting to giving the evidence miscarried.
However, given our earlier conclusion that a s 128 certificate was not available to the wife for her proposed evidence in chief, her Honour’s order must stand and the appeal will be dismissed.
Costs
The husband appeared without legal representation on the appeal and sought no order for costs in the event of the appeal being dismissed.
I certify that the preceding seventy-six (76) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Strickland, Ainslie‑Wallace and Aldridge JJ) delivered on 7 August 2018.
Associate:
Date: 7 August 2018
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