Friedrich v Herald & Weekly Times Limited

[1989] HCATrans 307

..

.

• ~

IN THE HIGH COURT OF AUSTRALIA

Registry No C13 of 1989

B e t w e e n -

JOHN FRIEDRICH

Applicant

and

HERALD & WEEKLY TIMES LIMITED

and DAVID SYME & CO LIMITED

Respondents

Application for special leave

to appeal

MASON CJ

BRENNAN J

McHUGH J

Friedrich

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 8 DECEMBER 1989, AT 10.41 AM

Copyright in the High Court of Australia

SlT4/l/PLC 1 8/12/89

MR P.J. O'CALLAGHAN, QC: If the Court pleases, I appear with

my learned friend, MR J. HAMMOND, for the applicant.

(instructed by Wisewould Schilling Cohens)

MR J.L. SHER, QC:  If the Court pleases, I appear with my

learned friend, MR J. RUSKIN, for the respondents.

(instructed by Corrs & Minter Ellinson)

MR O'CALLAGHAN: If the Court pleases, this matter, an

application for special leave, arises out of the

examination under section 541 of the CO:MPANIES CODE

of the applicant who had been then charged with

91 offences.

MASON CJ: Yes. Well, we are familiar with the history of

the matter and we have read the judgment of the

Full Court of the Supreme Court, so you can proceed

precisely to your grounds for saying that it is a

case in which special leave ought to be granted.

MR O'CALLAGHAN:  Yes, Your Honours. Your Honour, I just want

to just emphasize, (a) the fact of the charges;

(b) the fact that it was common ground that the

applicant is the subject of pervasive and intense

publicity and that -

MASON CJ: Well, I think we are even aware of that ourselves.

MR O'CALLAGHAN:  Yes. And, of course, the master made, as

appears at page 25 or 26 of his ruling, a rule that

there should be a restriction on publication. Now,

what we say,with respect, the error of the Full Court

was that in examining the history of section 541,
with great respect, there was an over-concentration

upon the emphasis which the court found the his·tory showed

as to the necessity for the examination to be

conducted in public to the detriment of the rights

of a person to have ensured a fair trial.

McHUGH J~ But the problem I have about the whole case is whether

or not it has proceeded on the correct basis to begin

with. The choice for the court is between an

examination in public and an examination in private.

Now, if there is an examination in public, what power

does the court have to prohibit publication? And that

is what is happening in this case, is it not? It has

been an examination in public.

MR O' CALLAGHAN:  ·-:That is so, Your Honour, and the power that

the court has derives either from section 541(5) or

from the inherent power of the court reflected in

section 18 of the SUPREME COURT ACT which provides
that the court may order in respect of an open court
hearing that no person shall publish or cause to be

published any part of the proceedings.

BRENNAN J: What section is that?

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MR O'CALLAGHAN: Section 18, Your Honour, of the SUPREME COURT

ACT.

BRENNAN J:	D,o we have that amongst our papers?
MR O'CALLAGHAN:	I regret to say I do not believe so,

Your Honour.

McHUGH J: That is of the SUPREME COURT ACT itself, is it?

MR O'CALLAGHAN:  Yes, Your Honour.

BRENNAN J: Would you read it to us?

MR O'CALLAGHAN:  I regret, Your Honour, that in the haste

with which I have come - - -

MR SHER:  The Full Court referred to it but I do not think they

set it out.

MASON CJ: Well, we have been given more than 250 pages of

material but we do not seem to have the critical

statutory provision.

MR O'CALLAGHAN:  I apologize, Your Honour. I can only say

that there has been a certain haste about the preparation

of this matter and one does overlook what is easily in
one's own mind and very seriously forgets the - but,

Your Honour, the provision of the section is reflected in the very words that the master made, that. is,

"that no person shall publish or cause to be published"

those words and we submit, I do not believe we will

hear any opposition to the proposition, that there is

the power to so act. The question is whether that

power should be exercised, and what the Full Court

said: upon a construction of section 541 there is,

in effect, a presumption very strongly in favour of the -

it is the norm for the examination to be heard in public

and with that we do not quarrel. But what we say the

Full Court erred is that in failing to appreciate that

the section provides a machinery for the prevention

of prejudice to a fair trial because of the power to

either make directions under subsection (5) or

under subsection (4) to rule that the hearing be held

in private.

MASON CJ: But what does it matter what the Full Court said

about section 541 if section 18 is the critical section?

MR O'CALLAGHAN:  Your Honour, the reason for concentrating

on section 541 is that it was because of the construction

which the Full Court placed upon section 541, namely

that it would only be in the most exceptional

circumstances that there would be justified an order

restricting publication and they reached that

conclusion, in our submission, by an over-concentration

upon the fact that you derive from - - -

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MASON CJ:	Mr O'Callaghan, we are not content to proceed with

this case unless we are armed with section 18 and

I think what we ought to do is stand the matter down,

proceed with the next case and such cases as are listed

after it until the parties are in a position to give us

copies of the relevant statutory provisions.

MR O'CALLAGHAN: If Your Honour pleases.

McHUGH J: And speaking for my part, I would like some assistance

on section 18 because these judgments concentrate on	its own, certainly would not authorize what you seek in section 541 and it struck me that section 541, just on
this particular case and it is obvious - well, it would
seem that section 18 is the real source of your rights,

.. if just a - - -

MR O'CALLAGHAN: Yes, Your Honour, I hear what Your Honour says.

MASON CJ:  But before you leave us, was section 18 argued in

the Full Court?

MR O'CALLAGHAN: Yes, Your Honour. It was assumed - the

Full Court took the view that the master acted either

by reference to section 541 or by reference to

section 18.

BRENNAN J:  I thought it was by reference to inherent power.

MR O'CALLAGHAN: Well, the inherent power, I think, Your Honour,

was really referring to the statutory reflection of that

inherent power.

BRENNAN J: There may be a question then of implied repeal

if there are two statutory provisions: one providing

for suppression orders and one for hearing in public.-

McHUGH J: Or in private.

BRENNAN J:  - - - or in private.

MASON CJ: Yes. But I think there is some substance in what

you say~ Mr O'Callaghan, because if one looks at

page 228, line 3, the Full Court says:

His order in those terms -

and the court is referring to the order of the master -

appears to have been made under powers

conferred by s.18(1)(c) of the SUPREME

COURT ACT 1986, although it is possible

that he relied either on the inherent

power of the Court or on the powers of

the Court given pursuant to s.541 of the

Code.

MR O'CALLAGHAN:	Yes, Your Honour.
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MASON CJ: All right. Well, we will stand this matter

down and you can let the associate know when you

have copies of the statutory material.

MR O'CALLAGHAN: If the Court pleases.

AT 10.49 AM THE MATTER WAS ADJOURNED

T4	UNTIL LATER THE SAME DAY
UPON RESUMING AT 11.34 AM:
MASON CJ: Yes, Mr O'Callaghan?
MR O'CALLAGHAN:  If the Court pleases, there has now been

provided to the Court a photocopy of page 8 of the

SUPREME COURT ACT 1986 which came into force on
1 January 1987 and repealed the previous SUPREME COURT

ACT and it was an Act to amend and to consolidate

and, indeed, section 18 was the successor to

section 29 of the old Act which was in more restricted

terms permitting the prohibition of publication in

cases where the public morality may have been

scandalized, et cetera. The Court will see that

section 18 provides:

18(1) 1he Court may in the circumstances

mentioned in section 19 -

may -

(c) make an orde~ prohibiting the

publication of a report of the whole

or any part of a proceeding or of

any information derived from a proceeding.

And section 19 provides that: 

The Court may make an order under section 18

if in its opinion it is necessary to do so

in order not to -

(b) prejudice the administration of justice.

Now, if I might say, Your Honours, that Your Honour

the Chief Justice did refer to page 228 of the application

book where the reference is made by the Full Court that

the master possibly relied on either the inherent power

of the court, the powers of the court given pursuant

to section 541, or section 18(1) (c), and at page 247 point 3,

the court said - - -

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McHUGH J: ~tr O'Callaghan,	I am afraid my volume is not numbered

so could you give me the judgment page, please?

MR O'OOLAGHAN:  Page 22, Your Honour.

BRENNAN J: Well, mine is numbered but not in the same way

as the Chief Justice's, so if you would give us the

page references of the judgment, it might be - - -

MR O'CALLAGHAN:  I am sorry, Your Honour. I can assure you

that was not intentional, Your Honour.

Your Honours will see there, referring to

HAMILTON V-:.. OADES:

recognises that the answers may be used to
obtain other direct evidence of any matters

revealed by the appellant. That is not to

deny that particular answers may be both

incriminating and very prejudicial and at

that time other steps may be justified, including orders for non-publication.

And in HAMILTON V OADES, 166 CLR 486 - that case

concerned the appeal from the Court of Appeal in

New South Wales which it held that it still retained

its inherent power to protect the privilege against

self-incrimination. This Court held that HAMILTON V

OADES did, in fact, abrogate the privilege. But in the

course of so ruling, Your Honour the Chief Justice

said - and I will briefly return to this case later -

at page 499:

For example, an examination may need to

be held in private, or the publication

of names or evidence restricted -

and referred to HUSTON V COSTIGAN which was a decision

of His Honour Mr Justice Toohey in which a witness in

the Costigan Royal Commission was held to be protected

by being examined in private.
and Gaudron, at page 504, Their Honours there referred	In the dissenting judgment of Justices Deane
to:
the power conferred and confirmed by s.541(5) -

as sustaining the power purported to be exercised by

Mr Justice Dawson in HAMILTON V OADES - - - the court but that, of course, was a dissenting judgment.

MASON CJ:  But what did they hold, that subsection (5)

sustained what?

MR O'CALLAGHAN:  Sustained the power of the New South Wales

Court of Appeal to preclude questions being asked which were self-incriminating.

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MASON CJ: But that is a different matter altogether.

MR O'CALLAGHAN: Absolutely, Your Honour, I am merely

referring it - but, again, His Honour Mr Justice Dawson

in HAMILTON V OADES, in referring to the inherent

power of the court, at page 510 point 1, said:

Reliance upon the inherent power is the

less understandable in this case where power

is expressly conferred upon the court by

s. 541(5) to give such directions as to the

matters to be inquired into and, subject to

sub-s(4), as to the procedure to be followed,

as it thinks fit.

MR SHER:	We have got copies here, Your Honours.
MASON CJ:	Have you? That would be very helpful, Mr Sher.
MR O'CALLAGHAN:	I am grateful.

MASON CJ: Justice Brennan and I have not got the Commonwealth

Law Report.

MR SHER:	Yes, it has just been published, Your-Honours.
MR O'CALLAGHAN:	Your Honours, the passage of Your Honour

the Chief Justice's reference was at page 499,

the top of the page.

MASON CJ:  Now, where is the passage in Justice Dawson's

judgment?

MR O'CALLAGHAN:	At page 510, Your Honour, the sentence: Reliance upon the inherent power is the
less understandable - - -

MASON CJ: Whereabouts is that?

MR O'CALLAGHAN:  At the top of the page, Your Honour: the

fourth line from the top of the page.

MASON CJ:  I see. But, again, thatdoes not deal with

restriction on publication.

MR O'CALLAGHAN:  No, Your Honour. What it deals with is a

direction - what His Honour was there saying is
that there is power within section 541(5) to give

directions so as to prevent prejudice inter alia

removal by subsection (12) of the protection against	in the administration of justice by reason of the
self-incrimination. Subsection (12) says that a person is obliged to answer questions but he may by claiming privilege protect himself against those answers being
used in any other criminal proceedings. And the Court
was saying that, for instance, it may be necessary to
prohibit a question being asked or, exemplifying it,

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the publication of the answers, and the Court were really

querying why the Court of New South Wales were concerned

to look to the inherent power of the court when it
considered that the power could be derived from
subsection (5). And so far as the master was concerned
and the Full Court are concerned, there is a

broad reference to the sources of power without

precisely identifying which one it was.

BRENNAN J: Your proposition is that it is necessary in this

case to make an order under section 18(1)(c) of the

administration of justice, is that correct? SUPREME COURT ACT in order not to prejudice the

MR O'CALLAGHAN:  Yes, Your Honour.

BRENNAN J: And the argument against you has been that in

proceedings of this kind which are inpublic there is

a public interest which outweighs that consideration

and leads to the refusal to make an order.

MR O'CALLAGHAN: Yes, Your Honour. What the Full Court said

was that it would require the most exceptional

circumstances to make an order restricting publication.

We say that that is importing far too much into

section 541 by reference to its history and the norm

being that it be held in public. If, in fact, the

answer to the question would prejudice or would

constitute a real risk to the administration of

justice, ie to a fair trial, then, we submit that

the court is clearly empowered both by section 541

and/or by the provisions of section 18.

McHUGH J: Well, I have trouble with that. In fact, I have

trouble with seeing section 18 applies at all.
Section 18 is a general section giving the court

power to prohibit reports in proceedings generally,

but section 541 is dealing with a very specific
subject-matter and it gives the court a choice to
make the examination in public or, in special

circumstances, to hold it in private. Now, when you

difficulty in seeing that the legislature could have	look at the policy behind section 541(4) I find some
intended that although the court chose to hold the
examination in public, nevertheless, section 18 could still apply to it. In other words, I am having
difficulty with the idea that section 18, a general
provision, has got anything to do with an examination
under section 541.

MR O'CALLAGHAN:  Your Honour, if I could deal with that point

precisely, if I can:  we would say that the provisions

of section 18 and/or of the inherent power of the court

provides that at any time, in any proceeding, when the

court would apprehend that an injustice could be

occasioned, then the court has the power to give

directions accordingly, in the same way that in a

recently published decision of this Court in JAGO,

which was dealing with the right to a speedy trial and

matters of that sort, the Court, in a number of

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instances, pointed to the power of a court to prevent
unfairness and we would say it is axiomatic, that if

a court in one of its divisions apprehends that to

pernit the publication of the answers constituted

under section - by reason of a person appointed under

section 541 would prejudice the fair trial of that

person or, indeed, of any other person, then it would

have power to act so as to prevent that occurring.

McHUGH J: But, you see, in that very case that may ground

an argument for holding the examination in private

or that part of the examination in private but it

seems odd that you allow an examination in public -
any member of the public can come into the courtroom

and hear the questions and answers, and yet at the

same time it is intended that the court has got a

general power under section 18 to prohibit the

publication of a report of the proceedings.

J:1R. O'CALLAGHAN:  Yes. Your Honour, the master himself in

giving his ruling reasoned that the public who were

interested and wanted to come to hear what was going
on could do so and their presence and their knowledge
of what was happening and their dissemination of what

occurred was not going to create the prejudice which the pervasive and very widely spread publicity which would be attendant upon the media being able to publish.

McHUGH J:  The theory of a fair report is it simply conveys

to the public at large what they could hear if they
went to the court itself.

J:1R. O'CALLAGHAN: Well, yes. What the master's order was directed to was to prevent potential jurors being prejudiced by reading and seeing and hearing media

and television publications and that, with great

respect, is good sense.

McHUGH J:  But it really gives you the worst of all possible

worlds, does it not, because people go there and then

they report it and somebody says, "Well, I've been

told by somebody who was there as to what happened"

and it rather highlights that you should have

a hearing in public or a hearing in private?

J:1R. O'CALLAGHAN:  Your Honour, the application initially made

by the applicant was for the hearing to be in private

and to be restricted to certain persons. That was

refused by the master and there was an appeal against

that which was also dismissed. But the practicality

of the matter, of course, is that the liquidator does
not oppose the restriction upon publication subject

to the examination being able to continue and the

persons who object to the publication order are

the interest represented by our learned friend,

Mr Sher, and for obvious reasons, but what we say is

the vice of the Full Court judgment is that it -

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having traced the history of the section and having seen

the prescription for the normal course to be held in
public then, in our respectful submission, placed far

too harsh a criteria as a condition for the imposition

of a restriction upon publication. The Full Court does

not doubt, as we have shown, I believe, that there is

power to prohibit publication but what they say is

that it would require exceptional circumstances to

impose a general order restricting publication.

Now, we say, in the circumstances of this case or in the circumstances of any case where a person is

charged with criminal offences and it is apparent and,

indeed, co!lllilon ground that the questions which will be

directed to him will be central to the very elements
of the offences with which he is charged, that if there

is to be very widespread publicity of that then, clearly,

it is within the power of the master, as it is in this

case, to impose a restriction so as to prevent that

prejudice arising.

Now, with respect to Your Honour Mr Justice McHugh,

you may well be right, sir, in the sense of saying

well, if you wanted to be really efficient and effective

about ensuring that, the proper thing is to hold the hearing in private but because one does not go as far

as that, does not, in our submission, disqualify an

intermediate position such as the master did adopt.

McHUGH J:  It still strikes me as a little odd that once you

have a hearing in public that you can prohibit any

part of it, particularly having regard to the purpose

of the examination. The purpose of the public

examination is so that the public will know about this.

It seems almost a contradiction in terms, in relation

to this section, to then say, "Well, although there's

a hearing in public so that the public can know about

this, nevertheless, we can prohibit the public from

reading about it."

MR O'CALLAGHAN: Well, Your Honour, with respect, that is a

recognition of present day realities. There has

been, unfortunately, in the last decade or so, three

or four cases of where the person concerned, woman or

man, is in a position which attract almost daily and

extensive publicity and it is on every form of the

media and every time of the media and this is in that

category of cases and the only effective way and

a·n effective way of dealing with it is to prohibit

publication in those terms.

Now, I might say, Your Honour, in the Supreme

Court of Melbourne in the Criminal Court at the present time there is a trial proceeding in which

the press are prohibited by order published on the
outside of the door from taking photographs and
publishing photographs of the accused leaving the

building and going back to his cells and so on. That

is the restriction upon a particular aspect of publication;

the public are otherwise free to be there and so is the media

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BRENNAN J:  Mr O'Callaghan, could I just understand the nature of this prejudice. He has been charged with 91 offences.

MR O'CALLAGHAN:  Yes, Your Honour.

BRENNAN J: At what stage have they reached?

MR O'CALLAGHAN:  That he has been charged and the committal

is predicted to occur in April of next year, Your Honour.

BRENN.Al~ J:	So, there has been no plea as yet to those?
~1R O'CALLAGHAN:	No, Your Honour.

BRENNAN J: And the questions that he may be asked in this

examination are questions which may go to the heart

of his guilt or innocence on those charges.

MR O'CALLAGHAN:  Your Honour, that is what we submitted

would be the fact. His questioning cormnenced

yesterday and that has been entirely vindicated.

BRENNAN J: Right. Well now, if he were to give - he cannot

refuse to answer the questions.

MR O'CALLAGHAN:	No.
BRENNAN J:	But if he does answer them, can those answers

be used against him?

MR O'CALLAGHAN: No, Your Honour. Subsection (12) provides

that if he claims privilege - and what has been adopted

is a compendium of saying "I object" - he is still

required to answer but those answers cannot be used

in evidence against him except for perjury and for

proceedings under section 541.

BRENNAN J: So, the risk is that the publication of any

confessional statement that is made is, under the

statute,not admissible on his trial but unless such

an order is made it will be disseminated to potential

jurors?

MR O'CALLAGHAN:  Yes. The potential juror will hear, if you

like, the Crown case and armed with the Crown case,

sit on the jury and no doubt ponder as to why the

court is. saying, "Well, you can only have regard to

the evidence which is here. And the issue is whether

he received $10,000 on a particular day" - I just

take that as an example - and the juror has read that

or heard it and he would have heard it in even more

difficult circumstances than that because it would

have been preceded by the confessor saying, "I claim

privilege because this may incriminate me, but, yes,

the answer is". And that is what we say is the only

appropriate way to approach this matter: is to

say that here is a compulsory interrogation of a person

potentially to stand trial of the very essence of the

crimes against him and we say that in those circumstances

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the court should be astute, as the master, indeerl, was,

to weigh the balance down very heavily in favour of

any direct prejudice to the administration of justice.

Now, it may be, in the course of the proceeding,

that the master who is in control of it can relax it

or whatever but to suggest that the exceptional

circumstances either did not exist, that is that it

would not be exceptional circumstances if exceptional
circumstances are required for an accused person to be
the subject of a compulsory interrogation and the risk

of attendant publicity or, alternatively, the section

does not require or the power under section 18 does

not require exceptional circumstances. It simply

requires that the court have a reasonable apprehension

that there will be a direct prejudice or a risk of a

direct prejudice to the administration of justice.

The passages of the Full Court's judgment where

we say, with respect, they were distracted, if I can

respectfully submit, are at page 13 or page 238 of

the judgment, at the foot of the page, the last

sentence:

Although the reason behind the legislative

change requiring a prima facie public

examination may be obscure, we are of

opinion that s.541 is directed to similar

ends to those to which the former s.250

was directed and that in general the object

of a public examination prima facie
directed by sub-section (4) is likewise to

inform the public of the affairs of companies

which have gone into liquidation or which
in other ways have failed, as well as

giving an opportunity to liquidators or other persons applying for examinations to obtain information -

and at page 15 point 1 - that is page 240 - Their Honours

said: 

Moreover, his decision that questions in

the course -

this is referring to His Honour Mr Justice Windeyer -

of a public examination of a person already

charged with an offence should be disallowed

only in specific circumstances and not as
a general rule is essentially consistent with

the conclusion that the public airing of a

company's affairs was intended by the new

section.

And at page 16, or 241, point 6, the court said:

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Since no dispute is resolved upon the hearing of an examination, the benefit must

be seen in the general publication of the

proceedings, whether by press, radio,

television or by word of mouth. Not only

might that lead to the possibility of further

information being provided from other sources

to the liquidator or other person in control
of the company, but the risk that improper

activities of company officers might thereby

be spread abroad may have been thought as
some form of deterrence to them: cf. McPherson
on Company Liquidation (3rd ed.) at page 431.

One may doubt that the more thick-skinned of

the company ':'sharks" of this world would be
especially conscious of the risk of
examination, but at least the possibility of

public examination may be seen as part of the

price paid for the privilege of incorporation

and the right to transact business as a

company, albeit that the price is usually

paid by those who become directors or officers
of that company. However, it is not for this

Court to query the policy of the statute, whatever views one may have as to the need

for a public examination -

and then:

The reason for examining the significance

and effect of the provision now requiring

that company examinations shall prima facie

be held in public is to see whether the
purpose of the section may be set at nought by

the conduct of an examination which, though held

in public, cannot be published abroad whether by

press, radio, television or other means.

And at page 243, in the middle of the page, the court

said - page 18 of the judgment; point 4:

The resolution of the question cannot therefore

be treated as directly analogous to that which

arises in contempt proceedings. In that kind

of case the publisher chooses to make a connnent
on a matter about to come before the courts:

here some form of publicity is both desired

and expected by the legislature. That does not

mean that it was intended that the press and

others should be free to make whatever report

they wish about the examination, nor does it mean

that the ordinary rules of contempt will not

apply to any connnent which any person might

foolishly make about the effect of the evidence

or about the appellant. What it does mean,

however, is that, save in the most exceptional

circumstances, no general order for non-publication,

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either in respect of all persons or any

specific person to be examined, should be

made where an order for public examination

has been made pursuant to s.541.

And at the middle of the page of page 244, page 19,

referring to Your Honour the Chief Justice's judgment

in HAMILTON V OADES:

Moreover he said that further powers exist

which in various circumstances will enable
the court to direct that the examination be

held in private or that publication of

names or evidence be restricted. Finally

the court retains the power to deny counsel

for the liquidator the right to put a

·~	particular question which might prejudice a
pending trial. However, as the Chief Justice
said of these powers:-
"But the types of questions which may warrant

such a course should not be predicted by a

court in advance of their being asked."

Now, that particular passage of Your Honour's judgment

does deserve to be looked at because what Your Honour

was there saying was this - the passage to which I have

previously referred at page 499, at the top of the

page, the second sentence:

For example, an examination may need to be

held in private or the publication of names or evidence restricted. HUSTON V COSTIGAN.

Or it may be that the court in conducting

the examination may feel it necessary, in

accordance with the statutory purpose, not

to permit a particular question to be asked

which would prejudice the examinee's fair

trial:	MORTIMER V BROWN: BARTON V OFFICIAL
RECEIVER.	But the types of questions which
may warrant such a course should not be

predicted by a court in advance of their being

asked.

Now, there, with respect, Your Honour was referring to

the position of a prohibition upon the asking of a

question and here, of course, what we are saying is

there shall not be a prohibition upon the asking of

questions but there shall be a restriction upon the

publication of the relevant answers or the actual answers.

And finally, at page 246, page 21, the court

said, at point 2:

At the same time there must also be placed

in the balance the policy of s.541 which

has already been discussed and from which

it may be deduced that fair and accurate

S1T7/10/PLC	14
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reports of the examination might fairly

have been contemplated by the Legislature,

in the interests of the public generally.

Publication in that way of the examination

is not substantially different from what

might be expected of evidence given at

connnittal proceedings or at the hearings

of Royal Connnissions or other public

enquiries. In considering these risks and

the balance to be struck, no assumptions

can be made about the form of the questions

and answers in the course of the appellant's

examination, nor can one at this stage

satisfactorily give directions in respect of

particular questins and answers, for when

they are asked, as Mason, C.J. stated, the

Court has all necessary powers, as does its

delegate for this purpose, the Master.

And as I said, at page 247, page 22, the court said:

That is not to deny that particular answers

may be both incriminating and very prejudicial and at that time other steps may be justified,

including orders for non-publication.

With respect, what the court is erroneously saying,

in our submission, is that the public interest is to be

paramount to the interests of the public and the
individual in achieving a fair trial; better, so the

judgment impliedly states, that the public be informed

of the details of the company's failure, albeit that

may cause some prejudice, because of the legislative
manifestation that the proceedings be public.

BRENNAN J: Well, does that present a problem to you,

Mr O'Callaghan? I mean, one can readily sympathize,

I suppose, with the viewpoint that a fair trial is a

first requirement and that public information about

an inquisitorial procedure should be secondary, but

here the court below has weighed those two factors

and reached a discretionary judgment against you.

Now, does that present any difficulty to the grant of

special leave?

MR O'CALLAGHAN: Well, with respect, Your Honour, I do not

necessarily accept that because what we say the
error of the court was was. to conclude that the policy

of the legislature in section 541 meant that it would

be a matter of discretion to balance whether or not
publicity should be preferred to the risk of prejudice

to a fair trial.	We say that is not something which
can be taken from section 541.	Section 541 has within

it a machinery to prevent that occurring and that

machinery includes a restriction against publication.

What we say to Your Honour Mr Justice Brennan, and we

would, with respect, adopt the words of His Honour

the Chief Justice in HINCH's case, 164 CLR 1. The

passage I refer to is at page 28, and if I could simply

read this to the Court and adopt it. Your Honour said:

S1T7/ll/PLC	15
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In assessing whether a particular

publication presents a real risk of serious

prejudice to a fair trial, ie, serious injustice,
it is necessary to ascertain whether the
references to the subject-matter of the
litigation are central or merely incidental to
the topic of public discussion. If the

references to an issue in the litigation are

central to the discussion the likelihood of

prejudice or serious prejudice is all the
stronger. If, however, the references to the
litigation are merely incidental, in the

majority of cases there is unlikely to be a

real risk of prejudice to the litigation.

Now, we submit that whilst it is clear that section 541

does take away the privilege to remain silent, it does

not, in our submission, take the further step of

saying that, ''nlat privilege to remain silent is taken

away and also, if necessary, you will be prejudiced in

your trial" and we submit that that is the fundamental

error of the Full Court and it is an error which, we say,

is a matter of great public importance and therefore a

matter appropriate for this Court to grant special leave.

MASON CJ:  Could I ask you one question? I understand your

criticism of the Full Court's judgment in so far as

it is based on their view of the history of the section

but what do you say about section 541(4) where it

contemplates the exercise of a power only in a situation

where there are special circumstances that make it

desirable to hold the examination in private?

Now, do you concede that that limitation, that condition,

should also apply to any restriction on publication?

MR O'CALLAGHAN:  Can I answer that this way by saying that

special circumstances, in our submission, would always

be constituted by the answers and the publication of

the answers being a direct risk to a fair trial. So,

I am not avoiding your question, Your Honour, but I am

would clearly embrace that situation. And if I could saying that the special circumstances in subsection (4)	adopt from the dissenting judgment of Their Honours
Mr Justice Deane and Justice Gaudron in which they
said that special circumstances - the pendancy of the charges will generally constitute special
circumstances. If Your Honours will just pardon me
a moment, I will just refer you to the particular passage in a moment, but - - -

MASON CJ: Yes, but when you look at the matters that are

specifically referred to under subsection (2)(a)

as matters that are going to give rise to an

examination, is it realistic to say that proceedings,

either existing or future against a person being

examined, are special circumstances, because one would

think that there must be many instances where proceedings"

are the natural accompaniment or outcome of an examination

involving conduct that answers to the description in (2)(a)?

SlT7/12/PLC	16
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MR O'CALLAGHAN:	Your Honour, with respect, we would not cavil

with that. Obviously, if a defaulting officer of a

company is going to be asked questions, it may provide

derivative evidence; he may subsequently be charged;

he may, indeed, have charges pending against him at that

time but what we do say, Your Honour, is that the

section operates consistently with that and also with

the imposition of such restrictions or directions

which would overcome any prejudice to that person's

T7	fair trial. We say that if, for instance, a person
was examined in private, then, ipso facto, that person's
fair trial would not be prejudiced. Likewise, if there is a restriction on publication of answers which if emblazoned across the media world would prejudice, then
there is no prejudice, albeit that the person is the subject of an investigation into inter alia fraudulent matters.

McHUGH J:  Mr O'Callaghan, there are questions and questions,

and answers and answers, and surely there would be many

questions asked of your client which, if publicized,
could not possibly affect the fair trial of the charges

against him. Now, why is not the better approach to

allow the court to deal with it on a question by question

basis. If, for instance, a question is put, "Did you

steal the money?",, well, it might be appropriate to

make an order in respect of the answer to that question,

particularly if there was an admission that the money was

stolen. But there are many questions one could think of

which probably would be common ground in a trial and

other questions which, really, in a realistic sense,

could not prejudice a trial which would take place in

12 months. Why is not the better way the way that the

Full Court has said the matter should be looked .at?

MR O'CALLAGHAN:  Your Honour, we say that the question by question

approach has all sorts of problems. If it were only

going to be a peripheral mention, then perhaps what

Your Honour says, with respect, would be valid but

here we have contended - and it was not denied at all

by the liquidator who appeared in the Full Court - that

virtually all of the questions or a great majority of

the questions would be central to his very criminal
liability because there are 91 informations, 86 of
which are based upon the creating of false invoices
purporting that equipment was contained in containers,
and the other six is the creation of false invoices
purporting the existence of debts due to the National

Safety Council.

Now, subject to my recognition of the stay which

is presently in place pursuant to the order of

His Honour Mr Justice Toohey - I take it I am permitted

to say this to the Court: that yesterday the applicant

was examined and - - -

BRENNAN J:  You may say what you wish to the Court but there is

no stay order with respect to anything you do say in

this Court.

S1T8/l/PLC	17
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MR O'CALLAGHAN:	Yes, I appreciate that, Your Honour. All I

am going to say is that the transcript ran from

page 714 to 821 and I am informed, whilst I was on

my feet, that because of the knowledge that there was

a potential, presumably, of this Court discharging the

order which was made yesterday to operate until

6 o'clock today or until further order, I am instructed

that the master has made an order in terms prohibiting

the publication of the great mass of all the evidence

given yesterday. I simply say to Your Honour

Mr Justice McHugh, as I said to His Honour Mr Justice Brennar

the nature of the questions asked and the answers given

was a vindication of the prediction that was made on

behalf of the applicant as to what he would be questioned

about and the applicant, as I think the Full Court

recognized, was in a bind because it is not possible

to go to the Full Court or, indeed, to this Court for

the reasons Your Honour Mr Justice Brennan just mentioned
a moment ago and say, "If I am asked these questions,

I am going to answer them in a particular way and that

will prejudice me" because those questions and answers

used in these proceedings or in proceedings before any

other body than the master or the person conducting the

examination would be admissible against him.

So, when the Full Court says, "We should know what

the questions are going to be or the detail of the

questions", it is really an impossibility to provide

them but we do have now - and I am in a position to

tender that material to the Court which I would seek to

do if the Court were minded to grant special leave -

MASON CJ:  But I am not clear at the nanent - what order has

the niaster made and when did he make it?

MR O'CALLAGHAN:  The master - some time after the resumption

of the hearing this morning, Your Honour, and my

learned junior made an application,which I was

aware he was going to make it, having provided pursuant

to directions last night a schedule of the passages of

the evidence which he claimed were appropriate for

specific protection or -

MASON CJ: Yes, in the light of prejudice to a fair trial?

MR O'CALLAGHAN: Yes, Your Honour, and as I say, what I am

instructed is, in consequence upon that the master

has made an order to operate until 4.15 pm today to

restrict the great bulk of the evidence which was

given yesterday from being published. Now, I would

suspect that the reason for the 4.15 position would be
to allow, if this Court discharged the order made

yesterday, an application to be made by someone to

a judge in chambers. But what we say - I put that	forward illustrative of the reasons why this Court,
in our submission, should grant special leave and to define what the limits of section 541, in the context of
a person who is being examined and is willing to be
examined, as he is required to be, and to answer questions.

S1T8/2/PLC 18

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BRENNAN J: But perhaps it is illustrative of something else,

namely that the more specific form of order is the

appropriate one and that the blanket order, either for
or against publication in a case like this, is

inappropriate and that the master's order in the form in

which it has now been formulated is an appropriate

order to ensure that particular answers to particular

questions should not be published to the prejudice

of the forthcoming proceedings.

MR O'CALLAGHAN:  Your Honour, if I could reply to that by

saying that we would say if there is to be a choice

between - in a case in which it is apparent that the

examinee is going to be very thoroughly questioned

upon the central elements of the offences with which

he is charged, that if there is to be a choice between

a general order or a specific order, we say that

justice would best be served by a general order

because then the matter is under the control of the

prohibition and the master. It can be relaxed at

any time but there is a fairness, in our submission

about a person in the position of the applicant being
required to answer questions protected by, for the time

being, a blanket order which, if there is a series of -

as Your Honour Mr Justice McHugh said - questions

which do not relate either directly or indirectly

to his criminal situation, can be published at the

end of the day. What the other situation provides

is that counsel who is appearing for him, if counsel

does appear for him, is got to be shooting up at the

app~opriate time. There is then a series of arguments

about specific questions and so on.

So I, with respect, submit that there is every

good reason why a general order should operate rather

than a specific one.

MASON CJ: But I would have thought if that was your approach,

you should have pursued the suggestion that the

examination ought to be private.

MR O'CALLAGHAN:  Your Honour, the position about that was

that the - - -

MASON CJ: Well, you cannot take that up here because you did

not take_that matter through to the Full Court.

MR O'CALLAGHAN:  With respect, that is quite correct,

Your Honour. I will not discuss - - -

MASON CJ:  I am merely putting to you in argument that if

you are really seeking, as it were, global protection

then it would seem that the appropriate response,

provided that there would sufficient grounds for it,

was to make an order for private examination rather

than treat it as a public examination that is to be subject to a general order restricting publication.

SlT8/3/PLC	19
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MR O'CALLAGHAN:  Yes. My answer to that, with respect

Your Honour, is that that proposition, valid as it may

be, with respect, from a point of view of efficiency

and so on, should not disqualify the efficacy and

the use of the order which the master did in fact

make. Because it is not as comprehensive as a private

sitting, then it does not mean that it is not of the

most desirable utility to prevent the mischief which

it is designed to overcome. I am not able to submit

matters other than what I have done and for the reasons

I have advanced, Your Honours, we would ask that the

Court grant special leave to appeal and that the
order granted by His Honour Mr Justice Toohey be

accordingly extended pending the appeal.

BRENNAN J: Could I just ask one further question, Mr O'Callaghan?	This is an order which is made, if it is made at all,
under section 18(l)(c) of the SUPREME COURT ACT or
conceivably under section 541. In neither instance
is there a provision made for notice to be served upon
a party who will be affected by the order, notably
those who have an interest in the further publication. What is the procedure that is adopted to give those who
have an interest in resisting suppression orders an
opportunity to be heard?
MR O'CALLAGHAN:	The way in which that arose, Your Honour, was

that the media were there and the provisions of

order 77 of the Supreme Court Rules gives the power

"to any person affected by an order of the master

to appeal therefrom" and that was invoked - that is,

firstly, the representatives of the Herald and Weekly

Times attended at the hearing and made submissions.

When the master made the particular orders, namely

the one that we are here about, they instituted appeals

to His Honour Mr Justice Cummins as did the applicant

in respect of orders that we failed to obtain.

BRENNAN J:  Is an appeal from the master to Justice Cummins a proceeding de novo?

MR O'CALLAGHAN:  Yes, Your Honour. They are the submissions.

MASON CJ: Yes, Mr Sher?

MR SHER: 

In answer to Mr Justice Brennan·' s question -· - -

you want to put to the Court but I might identify
for your assistance one matter that we see it

MASON CJ: 

I do·not want to cut you short or restrict what

that requires some attention and it is this: there

is some attraction in taking the view that this general

problem in this case is best handled by the making of a specific order or specific orders from time to time in the light of the way in which the examination continues,

in other words, there seems to be, on the face of it, some

attraction in the course that has been taken by the master

to date.

SlTS/4/PLC	20
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MR SHER:	We have never opposed such a course.
MASON CJ:	You have never opposed such a course?
MR SHER:	No, and indeed our submission to the Full Court was

that the order that was sought was premature and, indeed,

the Full Court's observations about there needing to be
exceptional circumstances was directed to the concept

of a general order in advance of knowing what was going

to be asked. What, in fact, happened was that Mr Friedrich's

advisors left it until the day upon which his examination

was to start to make an application suppressing

publication, as I understand it, not to have it in

private. The master made what we submit was a

self-contradictory order. He said, "The examination

ought to be in public"because that was the legislative
intent and then said that nobody could publish anything
that was said in the open precincts of his chambers.

So, that is why we went to Mr Justice Cummins and what happened was that a reporter present, aware of this

application being made, telephoned my instructing

solicitor who went over to the master and made some ad hoc representations. So, that is how the matter got underway, Your Honours.

Now, we contended before the Full Court and the

Full Court accepted this submission - and it followed

observations Your Honour the Chief Justice made in

HAMILTON V OADES to which the Court has already been

referred this morning - that the types of questions

which may warrant such a course, that is not permitting

particular questions which is tantamount to preventing

publication, should not be predicted by a court in

advance and Your Honour the Chief Justice referred to

a decision of His Honour Mr Justice Sweeney in a

bankruptcy examination, a case of BARTON, which was to

the same effect. Now, our primary submission to the

court, amongst others, was that the application was

premature and the court acceded to that application

and, in our submission, that is the way these matters

ought to be handled.

So, I have nothing to say in opposition to the suggestion which I apprehend has fallen from Your Honours,

that that is the way these. matters ought to be handled.

That is all I would want to say about that, Your Honours.

MASON CJ:  Very·well. We do not wish to hear you further,

Mr Sher.

MR SHER: If the Court pleases.

MASON CJ: Yes, Mr O'Callaghan?

MR O'CALLAGHAN:  Your Honour, the position of the making

what is described as a late application is, with respect,

appealing because for the reasons I described

previously the only way to approach the matter was to

SlT8/5/PLC	21	8/12/89
Friedrich

say, give us a restriction upon being asked -

having our hearing in public or restrtction upon

publication because we cannot identify the questions

in another court that we are likely to be asked

and the way in which we will answer before

the master. So, the answer to the lateness point

is that it is without merit.

So far as our learned friends say that they

do not oppose this position and it was premature,

I should say this: that before the Full Court my

learned friend, Mr Sher, was invited to seek

instructions from his clients as to whether they

would give an undertaking to the court that they

would not publish questions to which objection was

taken on the ground that they were claiming privilege

and our learned friend saw fit not to bother to obtain

instructions - - -

McHUGH J: That is a slightly different point though, is

it not?

MR SHER:	It is not quite right either.
MR O'CALLAGHAN:	I am not privy to your communications with

your clients, as you obviously know, I can only say

what occurred. But what we say, Your Honours, is

that the vice that we apprehend the question by question

approach - if I can so describe it - is going to produce

will be a series of further interlocutory appeals from

the master, if not, appeals to the Full Court and

we submit that as a matter of convenience that the

general order is the best, so as to satisfy the

interests of justice and expediency and it is that

general order which the Full Court have denied the

validity of it being made and we submit, for the

reasons we have previously stated, is an error and is

an error that should be corrected by this Court

granting us special leave to appeal.

MASON CJ: Yes, thank you, Mr O'Callaghan. The Court will

give its decision in this matter at 2 o'clock.

MR SHER: If Your Honour pleases.

AT 12.31 PM THE MATTER WAS ADJOURNED

UNTIL LATER THE SAME DAY

S1T8/6/PLC	22
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UPON RESUMING AT 2.01 PM:

MASON CJ: The publication of evidence which an accused

person is bound to give to an inquiry before his

trial relating to the issues to be tried may well

prejudice the fairness of that trial. To ensure

that the trial is fair, some restriction on

publication may be necessary but the restriction

should not exceed what is necessary to achieve that

object.

Here, the respondents accept that the master

may properly make an order restricting publication

of particular passages of the examination of the
applicant under section 541 of the COMPANIES CODE
where the restriction is necessary to ensure a fair

trial of the charges presently pending against the

applicant.

The application for special leave is designed

to restore a general or blanket order prohibiting the

publication of "any report of the examination of

John Friedrich". There is insufficient reason to

doubt the correctness of the decision of the Full Court

affirming the setting aside of the general order. Special leave to appeal is therefore refused.

MR SHER:  If Your Honours please, there are two matters that

I would like to draw to the attention of the Court.

The first is that we would seek an order for costs but, more importantly, could I take Your Honours to the order of His Honour Mr Justice Toohey made yesterday, which is at page 260 of the appeal book. Your Honours will observe that there was an order -

MASON CJ:  Up till 6 o'clock, was it?

MR SHER:  Yes. I would ask Your Honours to substitute for

the 116 11 the figure "2" - vary the order to substitute

"2" for 11 611 • The basis for the order, as we understand

it, and it was an order made in our absence, was to

ensure that the position - no prejudice occurred to

the applicant whilst the application for special leave

was dealt with by this Court. That now having been

dealt with, in our submission there is no basis for

restraining any publication pursuant to the order

under appeal any further.

MASON CJ:  Mr O'Callaghan, do you have any response to the

suggested variation of the order made by Justice Toohey?

MR O'CALLAGHAN:  Your Honour, we accept that the decision of

this Court is really destructive of that order save

for this, that the Court has noted that the respondents

accept the entitlement -

SlTll/1/RB	23	8/12/89
Friedrich

MASON CJ: That is another matter.

MR O'CALLAGHAN:  Yes, it is. All I am saying, Your Honour, is

that we do not oppose the lifting of the order of
Justice Toohey but we would, with respect, invite the

Court to note that the master, in the pursuance of

what has been contemplated by this refusal of the

application, has imposed another order, ie a specific

order.

MASON CJ: Yes, we note that. You told us that this morning.

We are aware of that. I do not think there is any

occasion for us to, as it were, publish any formal

acknowledgment of the making of the order by the

master, partly because we have not seen the order and

we do not know what it contains.

MR O'CALLAGHAN: I appreciate that, Your Honour. It is always

necessary, with respect, for orders coming down from on high not to be inhibiting of what the master has, for instance, this morning decided. That is the

reason why I thought it necessary to mention that to

the Court.

BRENNAN J: You can take what we have said and it may, no

doubt - - -

MR O'CALLAGHAN:  Yes, indeed, and I will, with respect,

Your Honour.

MASON CJ: And you do not oppose the making of an order for

costs?

MR O'CALLAGHAN:  No, Your Honour.

MASON CJ: In response to Mr Sher's application, the Court

varies the order made by Justice Toohey on Thursday,

7 D:ecember, by substituting "2 pm" for "6 pm" where it

appears in that order. The application for special

leave to appeal will be refused with costs.

AT 2.06 PM THE MATTER WAS ADJOURNED SINE DIE

SlTll/2/RB	24	8/12/89
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