HJ (a pseudonym) v IBAC

SUPREME COURT OF VICTORIA

COURT OF APPEAL

S EAPCI 2020 0091

HJ (a pseudonym)*	First Applicant
PQ (a pseudonym)	Second Applicant
v
INDEPENDENT BROAD‑BASED ANTI‑CORRUPTION COMMISSION	Respondent

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JUDGES:	BEACH, KYROU and KAYE JJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	22 June 2021
DATE OF JUDGMENT:	21 July 2021
MEDIUM NEUTRAL CITATION:	[2021] VSCA 200*

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PRACTICE AND PROCEDURE – Test for determining when court will release party from undertaking given to court – Whether judge erred in finding that test is what is in interests of justice and that change in circumstances is only an example of when interests of justice may warrant party being released – Leave to appeal granted, appeal dismissed – Adam P Brown Male Fashions Pty Ltdv Philip Morris Inc (1981) 148 CLR 170 applied, Mulvany v Hive & Wellness Australia Pty Ltd [2019] VSCA 122 explained.

LAW ENFORCEMENT – Search warrants – Procedure for inspection and seizure of documents subject to claims of privilege or irrelevance – Whether judge misconstrued power to inspect – Leave to appeal granted, appeal dismissed – Independent Broad‑Based Anti‑Corruption Commission Act 2011 ss 4, 15, 16, 40, 60, 91, 94, 97, 100, 101.

* This is an edited version of the judgment that was published to the parties on a confidential basis. This judgment refers to previous judgments and orders in the Trial Division and the Court of Appeal which were published to the parties on a confidential basis and which remain confidential.

HUMAN RIGHTS – Right to privacy in s 13(a) of Charter of Human Rights and Responsibilities Act 2006 – Construction of s 91 of Independent Broad‑Based Anti‑Corruption Commission Act 2011 compatibly with right to privacy in accordance with s 32 of Charter – Whether judge erred in applying Charter – Leave to appeal granted, appeal dismissed – Independent Broad‑Based Anti‑Corruption Commission Act 2011 ss 91, 97, 100, 101 – Charter of Human Rights and Responsibilities Act 2006 ss 3, 4, 7, 13, 32, 38.

PRACTICE AND PROCEDURE – Interlocutory injunction – Whether judge erred in concluding that requirements for granting interlocutory injunction not satisfied – Leave to appeal refused.

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APPEARANCES:	Counsel	Solicitors
For the Applicants	Mr H Borenstein QC with Mr C Tran	Slater and Gordon Lawyers
For the Respondent	Ms K A O’Gorman	Independent Broad‑Based Anti‑Corruption Commission

BEACH JA
KYROU JA
KAYE JA:

Introduction and summary

The respondent (‘IBAC’) is conducting an own-motion investigation into matters involving HJ. PQ is a person of interest in the investigation.

A judge of the Trial Division issued two search warrants pursuant to s 91 of the Independent Broad‑Based Anti‑Corruption Commission Act 2011 (‘IBAC Act’): one for execution at HJ’s premises and the other for execution at PQ’s premises. A day later, IBAC executed both warrants.

Later in the same month, HJ commenced a judicial review proceeding in the Trial Division against IBAC.[1] In its originating motion, HJ sought: an order in the nature of certiorari quashing IBAC’s decision to conduct the investigation; a declaration that the investigation was beyond IBAC’s powers; a final order restraining IBAC from continuing the investigation; and a final order for the delivery of materials seized pursuant to the warrants. The originating motion did not seek an interlocutory injunction. HJ claimed that the investigation was beyond IBAC’s powers for a number of reasons.
[1]PQ was added as the second plaintiff to the proceeding on 3 July 2020.

Additionally, HJ filed a summons for an urgent interlocutory injunction restraining IBAC from continuing its investigation until the final determination of the judicial review proceeding. During the hearing of the summons before Digby J, IBAC’s legal representative gave undertakings as to how IBAC would deal with the seized documents in relation to HJ’s claims for privilege and issues of relevance.[2] Digby J dismissed HJ’s application (‘Injunction Judgment’).
[2]The undertakings are set out in full at [40] below.

IBAC subsequently sought to be released from its undertakings or, alternatively, that its undertakings be varied to apply only to HJ’s claims for privilege.

On 3 July 2020, Daly AsJ granted an interlocutory injunction restraining IBAC from reviewing the seized documents pending the determination of its application to vary or be released from its undertakings.

On 28 August 2020, Kennedy J decided that IBAC’s undertakings should be varied to release IBAC insofar as the undertakings related to claims of irrelevance (‘Undertakings Judgment’) and, on 1 September 2020, she made an order to give effect to her decision.

On 7 September 2020, HJ and PQ applied to this Court for leave to appeal from the Undertakings Judgment on 11 grounds.[3] Those grounds may be broadly summarised as follows:

(a)Kennedy J failed to apply the correct test for the release of a party from an undertaking given to the court (grounds 1 and 2).[4]
(b)Kennedy J erred in her construction of s 91 of the IBAC Act and, in particular, she failed to properly examine how the Charter of Human Rights and Responsibilities Act 2006 (‘Charter’) should be applied to IBAC dealing with the seized documents (grounds 3–7).[5]
(c)Kennedy J erred in refusing to extend the injunction granted by Daly AsJ or otherwise grant an interlocutory injunction restraining IBAC from reviewing the seized documents (grounds 8–11).[6]

[3]In these reasons, all reference to grounds of appeal are to the proposed grounds of appeal.

[4]Grounds 1 and 2 are set out in full at [64] below.

[5]Grounds 3–7 are set out in full at [125] below.

[6]Grounds 8–11 are set out in full at [197] below.

On 23 September 2020, this Court made the following relevant orders:

1That the Applicants be permitted to commence these proceedings without divulging their names and in lieu using the pseudonym ‘HJ’ and ‘PQ’ respectively.
2That, pursuant to r 28.05(2) of the Supreme Court (General Civil Procedure) Rules 2015, the court file be made confidential and no person may inspect or obtain a copy of any documents on the court file, without further order.
3That, pursuant to s 30(1) of the Open Courts Act 2013, the whole of the proceeding be heard in closed court.

The applicants also sought a stay of Kennedy J’s order dated 1 September 2020. On 5 October 2020, this Court refused that application (‘Stay Judgment’).

For the following reasons: the application for leave to appeal will be granted in respect of grounds 1–7; the application for leave to appeal will be refused in respect of grounds 8–11; and the appeal will be dismissed.

Relevant provisions of the IBAC Act and the Charter
IBAC Act

Section 8(a) of the IBAC Act states that its objects include to ‘provide for the identification, investigation and exposure of … corrupt conduct’. Pursuant to s 15(2)(a), IBAC’s functions include identifying, exposing and investigating ‘corrupt conduct’. ‘Corrupt conduct’ is defined in s 4(1) to include conduct that involves the misuse of information by, or the dishonest performance of the functions of, a public officer or public body.

IBAC is empowered to conduct an investigation in accordance with its corrupt conduct investigative functions on its own motion under s 60(1)(c) of the IBAC Act. However, s 60(2) provides that IBAC must not conduct such an investigation unless it suspects on reasonable grounds that the conduct constitutes corrupt conduct.

IBAC’s investigative powers are set out in pt 4 of the IBAC Act. Division 4 of pt 4 of the IBAC Act (ss 91–97) sets out IBAC’s search warrant powers.

Pursuant to s 91(1)(a) of the IBAC Act, an authorised officer may, relevantly, apply to a judge of the Supreme Court for a search warrant in relation to particular premises, if the authorised officer believes on reasonable grounds that entry to the premises is necessary for the purpose of an investigation.

Section 91(3) of the IBAC Act then relevantly provides as follows:

If a Judge of the Supreme Court … is satisfied by evidence on oath or by affirmation … that there are reasonable grounds for the belief under subsection (1)(a) …, the Judge … may issue a search warrant authorising any person named in the warrant—
(a)to enter and search the premises … named or described in the search warrant and inspect any document or thing at those premises …; and
(b)to make a copy of any document relevant, or that the person reasonably considers may be relevant, to the investigation; and
(c)to take possession of any document or other thing that the person considers relevant to the investigation.

Section 94(2) of the IBAC Act relevantly requires IBAC to immediately take all reasonable steps to return a seized document or thing if IBAC is no longer satisfied that its retention is necessary for the purposes of an investigation or a legal proceeding arising out of an investigation.

Section 97 of the IBAC Act deals with privilege claims in relation to search warrants. It provides as follows:

97 Privilege claims in relation to search warrants
(1) This section applies if—
(a)a person executing a search warrant (the searcher) wishes to inspect, copy or seize a document or other thing under the search warrant; and
(b)a person who is entitled to claim the privilege (the claimant) claims that the document or other thing is the subject of privilege.

(2)The searcher must consider the claim of privilege and either—
(a)cease exercising the power under the search warrant in relation to the document or other thing over which the claim of privilege is made; or
(b)require the claimant to immediately seal the document or other thing in an envelope, or otherwise secure it if it cannot be sealed in an envelope, and give it to the searcher.

(3)The searcher must not inspect the document or other thing in considering the claim of privilege.
(4)If the searcher requires the claimant to give the document or other thing to the searcher under subsection (2)(b), the searcher must—
(a)notify the [IBAC] Commissioner as soon as practicable; and
(b)immediately give the document or other thing to the proper officer of the Supreme Court to be held in safe custody.

(5)Subject to section 101, a person must not open a sealed envelope or interfere with a document or thing secured otherwise than in an envelope before delivery to the proper officer of the Supreme Court.

Division 5 of pt 4 of the IBAC Act (ss 98–101) further deals with claims for privilege. Section 100 provides that IBAC may apply to the Supreme Court to determine whether or not a document sealed pursuant to s 97(2) is the subject of privilege. The claimant is entitled to appear and be heard on such an application. Under s 101, if the Court determines that the document is privileged, it must order that it be returned to the claimant, whereas if it determines that the document is not privileged, it must order that it be given to IBAC.

‘Privilege’ is relevantly defined in s 3(1) of the IBAC Act to mean:

(a)any privilege that a person is entitled to claim in any proceedings before a court or tribunal … ; and
(b)public interest immunity.[7]

[7]Paragraph (a) of the definition of ‘privilege’ does not apply to journalist privilege.

There is no specific provision in the IBAC Act dealing with claims that a document that IBAC proposes to seize — or has seized — pursuant to a search warrant is not relevant to IBAC’s investigation.

Section 16 of the IBAC Act states that ‘IBAC has power to do all things that are necessary or convenient to be done for or in connection with, or as incidental to, the achievement of the objects of this Act and the performance of its duties and functions.’

Under s 40 of the IBAC Act, current and former IBAC officers are, relevantly, prohibited from making unauthorised disclosures of information acquired by reason of the performance of their functions under the IBAC Act.

Charter

Section 13 of the Charter sets out a right to privacy in the following terms:

13 Privacy and reputation
A person has the right—
(a)not to have his or her privacy, family, home or correspondence unlawfully or arbitrarily interfered with; and
(b)not to have his or her reputation unlawfully attacked.

Section 3(1) of the Charter defines ‘person’ to mean a human being. Accordingly, the Charter applies to PQ but not to HJ.

Section 32(1) of the Charter provides that ‘[s]o far as it is possible to do so consistently with their purpose, all statutory provisions must be interpreted in a way that is compatible with human rights’. Section 32(3)(a) provides that s 32 ‘does not affect the validity of … an Act or provision of an Act that is incompatible with a human right’.

Section 7 of the Charter — which is in pt 2 (ss 7–27) — sets out the circumstances in which the human rights protected by the Charter may be limited. It relevantly states as follows:

7 Human rights—what they are and when they may be limited
…
(2)A human right may be subject under law only to such reasonable limits as can be demonstrably justified in a free and democratic society based on human dignity, equality and freedom, and taking into account all relevant factors including—
(a)the nature of the right; and
(b)the importance of the purpose of the limitation; and
(c)the nature and extent of the limitation; and
(d)the relationship between the limitation and its purpose; and
(e)any less restrictive means reasonably available to achieve the purpose that the limitation seeks to achieve.

(3)Nothing in this Charter gives a person, entity or public authority a right to limit (to a greater extent than is provided for in this Charter) or destroy the human rights of any person.

Section 38 of the Charter regulates the conduct of public authorities. It relevantly provides as follows:

38 Conduct of public authorities
(1)Subject to this section, it is unlawful for a public authority to act in a way that is incompatible with a human right or, in making a decision, to fail to give proper consideration to a relevant human right.
(2)Subsection (1) does not apply if, as a result of a statutory provision or a provision made by or under an Act of the Commonwealth or otherwise under law, the public authority could not reasonably have acted differently or made a different decision.
Example
Where the public authority is acting to give effect to a statutory provision that is incompatible with a human right.
…

It was not in dispute that IBAC is a ‘public authority’ as defined in s 4 of the Charter.

Facts and procedural history

At some point prior to the issue of the two warrants, IBAC commenced investigating matters involving HJ.

The warrant for execution at HJ’s premises described the ‘[n]ame and/or description of person, or document or thing’ as follows:

1Any documents, items or things (including mobile phones, computers or other electronic devices, electronic or magnetic storage devices and related manuals, passwords and equipment) that:
(a)is or has been created or used by [PQ] or [AB]; and
(b)relates to, or contains or may contain information about [certain specified matters].

2Any documents, items or things (including mobile phones, computers or other electronic devices, electronic or magnetic storage devices and related manuals, passwords and equipment) relating to, or which contain or may contain information relating to the employment of [BC] by [HJ].
3The entire [HJ] electronic user profile and any back up or historical version of the user profile of [BC], including all emails, documents and internet browsing history.

The description in the warrant for execution at PQ’s premises was substantially similar in relation to paras 1(b) and 2 above, but did not include paras 1(a) or 3.

Both warrants described the ‘[p]urpose for search’ as follows:

Entry and search of the premises is necessary for the purpose of an investigation into suspected corrupt conduct being conducted pursuant to section 60(1)(c) of the [IBAC Act].

Both warrants stated that certain named officers of IBAC were authorised to enter and search the specified premises:

to inspect any document or thing; and
to make a copy of any document relevant to the investigation; and
to take possession of any document or other thing relevant to the investigation.

When IBAC executed the warrants, it seized documentary and electronic materials which included eight mobile phones, two iPads, more than 70 USBs, four laptops, three computers, three hard drives and data from HJ’s servers (‘seized documents’). The seized documents were taken to IBAC’s offices where data was extracted and stored in a secure database controlled by its High Tech Crime unit (‘HTC unit’). This database is not accessible by IBAC officers outside of the HTC unit, such as IBAC investigators and in-house lawyers.

Following an exchange of correspondence regarding the process by which the applicants might claim privilege over seized documents, IBAC’s legal manager sent a letter to the applicants’ solicitors the day prior to the hearing before Digby J. That letter set out the process for dealing with the applicants’ claims for privilege which it said had been agreed by the applicants’ previous solicitors. The final step of that process was that ‘where there was no agreement, the process set out in the IBAC Act for dealing with those claims could then be followed’. The letter then stated the following in relation to claims that seized documents were not relevant to IBAC’s investigation:

We understand that your clients, or in particular one client [PQ], are now concerned that there may be private and/or sensitive material that has no relevance to the IBAC investigation. We confirm, as discussed during our telephone call of yesterday, that IBAC has no interest in any documents that are not relevant to the investigation.
IBAC now invites you to engage in the same process as set out above, to enable you to clearly identify irrelevant material. It will provide your clients with the comfort they require with respect to any privileged or irrelevant material that has been seized. …
After the completion of the above process, IBAC would return material to the client(s) or identified legal representative that we accept is either subject to client legal privilege (or other identified privilege) or irrelevant to our investigation.
In the event agreement cannot be reached about an item, it will be sealed and it can be dealt with as part of a court process under the IBAC Act.

As we have already stated at [3] and [4] above:

(a)HJ commenced a judicial review proceeding seeking (among other relief) an order quashing IBAC’s decision to conduct the investigation;
(b)HJ filed a summons seeking an interlocutory injunction restraining IBAC from continuing the investigation until the final determination of the judicial review proceeding; and
(c)the summons was heard on an urgent basis by Digby J.

At the hearing of the summons before Digby J, HJ was represented by senior and junior counsel and IBAC was represented by one of its principal internal lawyers, CD. During the hearing, the following exchange took place between CD and Digby J as to how IBAC would deal with the seized documents with respect to claims by HJ for privilege or irrelevance:

[CD:] IBAC has already given an undertaking to the solicitors for [HJ] that it will not examine any of the material [it] has seized until [HJ] has had the proper opportunity to make a claim for privilege. And, similarly if [HJ] wishes to raise any issues about what might or might not be relevant, IBAC is willing to hear those matters and have that discussion. I can further give that undertaking to the court that IBAC will not review any of the material. On a practical level, Your Honour, within the IBAC premises, there’s a separate unit that deals with electronic devices. That unit is isolated from the rest of IBAC. There are records of access to everything in there. I can give an undertaking that no one will further access the material if that’s required.

HIS HONOUR: Until when? Until [HJ] or persons nominated by [HJ] engage in the process of identifying … privileged and or confidential material.
[CD]: Well, just to be clear, Your Honour, in terms of facilitating that process, someone from the, it’s called the High Tech Crime Unit in IBAC, will have to run the software to extract the material to enable [HJ] to look at it. That does not involve them looking at the contents of the material. So, to that extent someone would have to have access to that. But other than that, no one will have access.[8]

[8]Transcript of Proceedings 40.1–40.28.

Digby J dismissed the application in a judgment delivered at the conclusion of the parties’ submissions. He found that there was no sufficiently arguable serious issue to be tried in the proceeding which could provide the basis for the injunctive relief sought.[9] He took IBAC’s undertakings into account in making this finding and his further finding that the balance of convenience significantly favoured IBAC.[10] However, his references to IBAC’s undertakings are not entirely clear. That is because, although at para 76 of his reasons he appears to indicate that IBAC’s undertakings extend to not examining seized documents until HJ has had an opportunity to make claims for irrelevance as well as privilege, his summary of IBAC’s undertakings at paras 46 and 48 is not to that effect. Paragraphs 46 and 48 of Digby J’s reasons are as follows:

[IBAC] also noted that it has already provided the solicitors acting for [HJ] with an undertaking that [IBAC] will refrain from examining any of the seized material until [HJ] has had the opportunity to make claims for privilege, and [IBAC] has stated that it remains open to discuss with [HJ] the relevance of any of the seized material.
…
As to the balance of convenience [IBAC] emphasises that it has undertaken to [HJ] that it will not examine any of the seized material until [HJ] has had a proper opportunity to make a claim for privilege and further [IBAC] offers to undertake that it will not review any of the material until [HJ] has had the opportunity to assert privilege over specific materials.[11]

[9]Injunction Judgment [59], [60], [67], [73], [74].

[10]Injunction Judgment [72], [75]–[76], [79].

[11]Injunction Judgment [46], [48] (citations omitted). See also paras 72 and 79 of the Injunction Judgment.

The order made by Digby J recorded IBAC’s undertakings in the following terms:

[IBAC] by its Counsel undertakes —
(i)that save for making one copy for the purpose of protecting the integrity of the evidence and one copy for provision to [HJ] to provide it with the opportunity to make any claim for privilege or raise any issue in respect of relevance, there will not be any further copies made of the documents, devices and other materials seized by [IBAC] … [from HJ’s and PQ’s premises] until any claim for privilege is made and resolved;
(ii)not to disclose or disseminate the said materials seized pursuant to the search warrants … except when required for the performance of the duties or exercise of the powers of [IBAC]; and
(iii)where material is subsequently determined or agreed to be either privileged or irrelevant, access to this material by [IBAC’s] officers will be limited to officers within [IBAC’s] High Tech Crime Unit where such material will be electronically quarantined such that [IBAC’s] investigators can only review the balance of the material.[12]

[12]This order was subsequently amended to delete references to HJ’s and PQ’s premises.

On the day of the hearing before Digby J, consent orders were also made that the proceeding be heard in closed court pursuant to s 30(1) of the Open Courts Act 2013 and that disclosure of a report of the proceeding was prohibited pursuant to s 20.

The parties subsequently proceeded with the foreshadowed review of the seized documents. The applicants tagged on IBAC’s database the seized documents that they claimed were privileged (‘tagged privilege documents’). The HTC unit then provided spreadsheets to the applicants that contained the metadata — and, in some cases, the contents — of the tagged privilege documents (‘privilege claim spreadsheets’). This information was quarantined by the HTC unit from IBAC investigators. Upon receipt of the privilege claim spreadsheets, the applicants edited the spreadsheets by removing any privileged content and some of the metadata that the applicants said could reveal the privileged information (‘edited privilege claim spreadsheets’). The applicants returned the edited privilege claim spreadsheets to IBAC, with the items contained in the spreadsheets representing their privilege claims.

In May 2020, an issue arose between the parties as to whether IBAC investigators should be able to examine the metadata of the tagged privilege documents. By email on 22 May 2020, the applicants claimed that such an examination would be a contravention of s 97(3) of the IBAC Act. That was disputed by IBAC; however, it ceased reviewing the edited privilege claim spreadsheets. An issue also arose as to whether IBAC’s undertakings prevented it from inspecting seized documents that the applicants claimed were not relevant to IBAC’s investigation until the relevance issue was resolved. IBAC denied that the undertakings had this effect. However, in an email dated 28 May 2020, IBAC undertook that it would refrain, until 4:00 pm on 1 June 2020, from inspecting the seized documents that were subject to privilege and irrelevance claims if the applicants issued a summons by that time to restrain IBAC from such inspection. The date was extended by further agreement to 4:00 pm on 4 June 2020.

On 4 June 2020, HJ filed a summons, para 1 of which sought leave to file an amended originating motion and para 2 of which sought an order that PQ be added as a second plaintiff. Paragraph 3 of the summons sought an interlocutory injunction restraining IBAC from inspecting the seized documents or any information derived from them (‘derived information’) until the determination of the judicial review proceeding or further order. The proposed amended originating motion included a new ground 3 which asserted that ‘IBAC has acted, and/or is proposing to act, unlawfully in breach of [its] undertakings …, in breach of the IBAC Act and in breach of the [Charter]’. It also included a new para 5A which sought an order that, until further order, IBAC be enjoined from inspecting the seized documents or any derived information.

In opposition to HJ’s summons, CD (IBAC’s principal internal lawyer who gave the undertakings at the hearing before Digby J) affirmed an affidavit on 22 June 2020 which relevantly stated:

The undertaking given to the Court … was intended by IBAC to confirm that:
aIBAC would meet its obligation to provide [HJ] and [PQ] with a reasonable opportunity to claim privilege over anything that IBAC had seized before IBAC inspected it and that the process by which IBAC determined those claims, and asked the court to determine those claims, would follow the statutory process set out in the IBAC Act; and
bIBAC would also take the additional step, which it was not obliged to, and hear and consider relevance issues raised by [HJ] and [PQ].

In response to the amended originating motion received from [HJ], the IBAC Commissioner has told me that in agreeing to hear [PQ] on ‘relevance’ he did not agree to and did not contemplate that there would be a process by which a third party (as suggested in [HJ’s solicitor’s] affidavit … and [HJ’s] submissions …) would determine claims made by [HJ] and [PQ] that particular documents were not relevant to IBAC’s investigation.

On 1 July 2020, the applicants completed the process of returning the edited privilege claim spreadsheets to IBAC. The items contained on the spreadsheets represented their privilege claims. The parties engaged in additional correspondence to resolve technical issues and reduce the quantum of privilege claims. Revised edited privilege claim spreadsheets were provided to IBAC on 10 July and 13 August 2020.

On 3 July 2020, Daly AsJ heard HJ’s summons dated 4 June 2020. In the course of the hearing, IBAC indicated that, if Daly AsJ accepted the applicants’ broad interpretation of IBAC’s undertakings, it proposed to make an application to vary or be released from the undertakings. Daly AsJ made the following relevant orders:

(a)PQ be added as a plaintiff (para 1 of the order).
(b)HJ and PQ have leave to amend the originating motion to include ground 3 — that IBAC had acted, or proposed to act, unlawfully — and para 5A — being a claim to restrain IBAC from inspecting the seized documents or any derived information until further order (para 2 of the order).
(c)IBAC (save for officers of the HTC unit) be restrained from reviewing the seized documents, including the metadata derived from those documents, pending the hearing and determination of IBAC’s foreshadowed application for an order to vary or be released from the undertakings it gave to the Court (paras 3 and 5 of the order).

In paras C–E of the ‘other matters’ section of her order, Daly AsJ relevantly stated as follows:

A temporary injunction will be granted to restrain [IBAC] from inspecting the balance of the documents seized pursuant to the warrants (‘documents’) (that is, the documents not being the subject of privilege claims) pending [IBAC’s] foreshadowed application to vary and/or be relieved of the undertakings given by its solicitor to this Court … (‘undertakings’). The sole basis for granting the injunction is that there is a serious question to be tried as to whether [IBAC’s] expressed intention to inspect the balance of the documents is a breach of the undertakings.
Whether [IBAC] was obliged to give the undertakings to enable [HJ] to raise issues of the relevance of the documents is beside the point: it did in fact give the undertakings. Having regard to the transcript of the hearing before Digby J … (see, in particular, T37-41), and his Honour’s reasons … (see, in particular, paragraphs [72] and [76] of his Honour’s reasons), it is tolerably clear that the undertakings should not be given the narrow construction contended for by [IBAC], but rather, the parties (and his Honour) envisaged that there would be communications between the parties to enable the private and confidential information of [PQ] in particular to be excluded from the documents to be inspected by [IBAC].
Having found that there is a serious question to be tried as to whether the foreshadowed conduct of [IBAC] would be in breach of the undertakings, the balance of convenience clearly favours [HJ], given that [IBAC] has also foreshadowed an application to vary and/or be released from the undertakings, provided that such an application can be made and listed promptly.

Daly AsJ did not otherwise publish any reasons for her orders.

By summons dated 8 July 2020, IBAC sought an order that it be released from its undertakings or, alternatively, an order that the undertakings be varied so as to apply only to the applicants’ privilege claims.

The applicants completed their review of the seized documents for irrelevance and privacy claims on 15 July 2020. They tagged on IBAC’s database the documents the subject of such claims (‘tagged irrelevance documents’). The tagged irrelevance documents were obtained from eight mobile phones, two iPads and eight computers/servers. IBAC provided the applicants with spreadsheets listing the tagged items from the mobile phones on 28 September 2020.

To facilitate the applicants being able to properly make their privilege claims, a further privilege review is to occur in respect of the eight computers/servers. Accordingly, spreadsheets in relation to tagged privilege documents have not been provided for these devices.

Overview of Kennedy J’s Undertakings Judgment and grounds of appeal

On 20 August 2020, Kennedy J heard IBAC’s summons dated 8 July 2020. She delivered judgment on 28 August 2020, granting IBAC a variation of the undertakings. She considered that it was in the interests of justice to vary the undertakings for four reasons. First, there were changed circumstances. Secondly, there was some ambiguity about the scope of the undertakings. Thirdly, the undertakings were given under urgent conditions without contest. Fourthly, continuation of the undertakings was liable to hinder the express powers given to IBAC under the IBAC Act.[13] Kennedy J also found that there was no basis for granting the applicants further injunctive relief.[14] Kennedy J noted that, as at the time of the hearing before her, the applicants had made privilege claims in respect of 90,000 documents and irrelevance claims in respect of 15,200 documents.[15]
[13]Undertakings Judgment [98], [100].
[14]Undertakings Judgment [101]–[108].
[15]Undertakings Judgment [27], [30].

Kennedy J’s reasons are discussed in detail below, under the grounds of appeal to which they relate.

On 1 September 2020, Kennedy J made an order refusing the applicants’ application for injunctive relief and varying IBAC’s undertakings so that they read as follows:

ithat save for making one copy for the purpose of protecting the integrity of the evidence, and making and providing any necessary copies for the [applicants] and the Court in order for any privilege claims to be determined by the Court, there will not be any further copies made of the documents, devices and other materials seized by [IBAC] … that are the subject of a claim for privilege received by [IBAC] until any such claim for privilege is resolved;
iinot to disclose or disseminate the materials seized pursuant to the search warrants … except when required for the performance of the duties or exercise of the powers of [IBAC]; and
iiiwhere material is determined or agreed to be privileged, access to this material by [IBAC’s] officers will be limited to officers within the [HTC unit] where such material will be electronically quarantined such that [IBAC’s] investigators can only review the balance of the material.

Kennedy J stated that the variation to the undertakings made it clear that ‘there is no generalised prohibition on inspection of material which is not subject to a claim for privilege’.[16]
[16]Undertakings Judgment [113].

As we have already stated, on 7 September 2020, the applicants applied to this Court for leave to appeal against Kennedy J’s decision on 11 grounds. For convenience, we will discuss the grounds in three groups as follows:

·Grounds 1 and 2, which deal with Kennedy J’s decision to vary IBAC’s undertakings.
·Grounds 3–7, which deal with Kennedy J’s decision on the construction of s 91 of the IBAC Act and the application of ss 7, 13, 32 and 38 of the Charter.
·Grounds 8–11, which deal with Kennedy J’s decision on the applicants’ claim for an interlocutory injunction.

For each of the three groups, we will set out relevant parts of Kennedy J’s Undertakings Judgment, the applicable grounds of appeal, the parties’ submissions and our decision. Where relevant, the discussion of our decision on particular grounds will include a summary of any legal principles that are applicable to those grounds.

Grounds 1 and 2: Variation of IBAC’s undertakings
Kennedy J’s decision to vary the undertakings

Kennedy J held that whether there should be a release of an undertaking requires an exercise of judicial discretion. Citing Australian Securities and Investments Commission v Xiao[17] and Just Group Ltd v Peck,[18] she stated that the essential question is whether it is ‘unjust’[19] or in the ‘interests of justice’[20] to hold a person to an undertaking, having regard to the individual circumstances of the particular case.[21]
[17][2012] NSWSC 1210 (‘Xiao’).
[18][2016] VSC 614 (‘Just Group’).
[19]Xiao [2012] NSWSC 1210, [10].
[20]Just Group [2016] VSC 614, [88].
[21]Undertakings Judgment [37].

Relying upon Deputy Commissioner of Taxation v Karas,[22] Kennedy J stated that she considered it to be relevant, in the interests of justice, to consider whether the undertakings in this case may hinder IBAC in the exercise of its statutory functions. She rejected the applicants’ submission that Karas ought to be distinguished because it was concerned with the release of a Harman undertaking.[23]
[22][2012] VSC 143, [59]–[60] (‘Karas’).
[23]Undertakings Judgment [38].

Kennedy J stated that Mulvany v Hive & Wellness Australia Pty Ltd[24] — which we discuss in detail at [90]–[96] below — highlighted the importance of changed facts in releasing a party from an undertaking. However, she distinguished Mulvany from the present case on two ‘significant features’.[25] First, Mulvany concerned an interlocutory order which was made following a contested hearing, and which was based in part on an earlier undertaking, whereas the present case concerned an oral undertaking given in an urgent context rather than a contested order.[26] Secondly, the application to vary the relevant order in Mulvany was specifically based on changed circumstances and there was no suggestion that the original interlocutory order should not have been made, or that it should have been set aside or re-argued. Kennedy J stated that this was distinguishable from the present case because IBAC suggested that its undertakings should be revisited as ‘they hinder IBAC’s functions under the IBAC Act, and are not properly grounded in the terms of the IBAC Act’.[27]
[24][2019] VSCA 122 (‘Mulvany’).
[25]Undertakings Judgment [34].
[26]Undertakings Judgment [35], citing Mulvany [2019] VSCA 122, [69].
[27]Undertakings Judgment [36], citing Mulvany [2019] VSCA 122, [30].

In any event, after stating that the undertakings were material to Digby J’s determination,[28] at para 98 of the Undertakings Judgment, Kennedy J found that circumstances had changed since Digby J’s determination, for the following reasons:

•the claims for privilege have been made, and are now subject to the regime under the IBAC Act;
•the [applicants] have been given an extensive opportunity to put forward their claims for relevance;
•notwithstanding the effluxion of almost 12 months, and the attempts to ‘co-operate,’ it appears that there are, at least, some 15,200 claims for irrelevance that have not yet been resolved with the result that the investigation is stalled.[29]

[28]Undertakings Judgment [97].

[29]Undertakings Judgment [98]. See also Undertakings Judgment [31].

Kennedy J was satisfied that it was in the interests of justice that IBAC be released from its undertakings insofar as they related to irrelevance claims. She considered it appropriate to vary the undertakings in the light of the changed circumstances identified above, as well as the following matters:

•there is some ambiguity about the scope of the undertakings;
•the undertakings were given under urgent conditions without contest; and
•continuation of the undertakings is liable to hinder the express powers given to IBAC under the IBAC Act.[30]
[30]Undertakings Judgment [100] (citations omitted). See also Undertakings Judgment [96].

Terms of grounds 1 and 2

Grounds 1 and 2 are in the following terms:

1The primary judge erred by failing to apply the correct test for the release of a party from an undertaking given to the Court.
2In the alternative to ground 1, the primary judge erred in finding at [98] of the [Undertakings Judgment] that if a change of circumstance was necessary to found a release from an undertaking, then the making of the [applicants’] privilege claims, the opportunity afforded for the [applicants] to make their claims for relevance, the effluxion of time and the unresolved relevance claims, constitute the requisite change of circumstances.

Parties’ submissions on grounds 1 and 2

The applicants submitted that the test for release of a party from an undertaking is that stated in Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc, namely:

A court must remain in control of its interlocutory orders. A further order will be appropriate whenever, inter alia, new facts come into existence or are discovered which render its enforcement unjust. Of course, the changed circumstances must be established by evidence.[31]

[31](1981) 148 CLR 170, 178; [1981] HCA 39 (citations omitted) (‘Adam P Brown’).

The applicants contended that Kennedy J did not address Adam P Brown and that, at paras 35 and 36 of the Undertakings Judgment,[32] she erroneously distinguished Mulvany.[33] According to the applicants, this was so for three reasons. First, IBAC’s undertakings were given in circumstances that were analogous to the situation addressed in Mulvany.[34] Secondly, the outcome in Mulvany was not confined to the issue of changed circumstances. Rather, after the primary judge in that case rejected Mulvany’s submission that there were changed circumstances, Mulvany sought to argue that the undertaking could be varied even without changed circumstances. Thirdly, that the undertakings might hinder IBAC’s functions under the IBAC Act, or not be properly grounded in the terms of the IBAC Act, did not provide a proper basis for revisiting them. This was said to be because the undertakings were given freely and without equivocation by IBAC’s lawyer (CD) and, by so doing, influenced Digby J in his decision about whether to grant the interlocutory injunction sought by HJ. It was further said that there was nothing in the IBAC Act which prevented IBAC from agreeing to a regime with a person affected by a warrant as to how a determination of relevance may be made.
[32]See [61] above.
[33][2019] VSCA 122.
[34][2019] VSCA 122, [69].

In oral submissions, senior counsel for the applicants argued that IBAC proffered the undertakings to Digby J in a contested hearing to avoid the imposition of interlocutory injunctions. He submitted that the policy against re-litigation of matters which underpins the requirement to show change of circumstances applied with greater force in the present case than in Mulvany. He contended that the undertaking in Mulvany should be treated as effectively ex parte because Mulvany was unrepresented and the undertaking was the ‘price’ for him to obtain an adjournment.

The applicants argued that Kennedy J was wrong, at paras 37 and 38 of the Undertakings Judgment, to decide IBAC’s application to vary its undertakings by reference solely to whether it was unjust or in the interests of justice, without any reference to change of circumstances.[35] They submitted that, in Just Group, upon which Kennedy J relied, reference was made to ‘a material change in circumstances’ before considering the interests of justice.[36] They contended that two additional cases upon which she relied — Xiao[37] and Karas[38] — were distinguishable on the facts. They further contended that Xiao was an inapt authority as it did not refer to Adam P Brown.
[35]See [59]–[60] above.
[36][2016] VSC 614, [88].
[37][2012] NSWSC 1210.
[38][2012] VSC 143.

In oral submissions, senior counsel for the applicants emphasised that Karas related to an application for release from a Harman undertaking. According to him, because a Harman undertaking was imposed by operation of law, different reasoning and policy considerations applied to release from such an undertaking compared to an undertaking proffered by a party in the course of a contested hearing. In response to questions from the Bench, senior counsel conceded that the test that applied to release from a voluntary undertaking is the same as for discharge of an interlocutory injunction. However, he maintained that release from a Harman undertaking was different because a Harman undertaking sought to protect a different interest and did not involve the court re-visiting the issue.

In oral submissions, senior counsel for the applicants referred to the observation by the High Court in Adam P Brown that an interlocutory order may be varied ‘whenever, inter alia, new facts come into existence or are discovered which render its enforcement unjust’. He argued that the words ‘inter alia’ contemplated that ‘other circumstances which are commonly accepted as qualifying’ may warrant a variation or discharge of an undertaking. He stated that mistake or fraud could constitute such circumstances, but the interests of justice could not. He submitted that, although a decision to release a party from an undertaking was discretionary, the court must exercise that discretion judicially and that rules of practice could be adopted to guide the exercise of the discretion.

Following discussion with the Bench, senior counsel for the applicants conceded that the existence of factors additional to a change of facts meant that the relevant test had to be framed at a higher level of generality than a change of facts. He offered the following formulation: ‘you have to establish circumstances that make it unjust to continue to enforce the undertaking’. Senior counsel contended that the test could not be formulated in terms of whether it was unjust not to vary the undertaking. That was said to be because such a formulation did not set out any qualifying factors — such as mistake, fraud or change of facts — which would render it unjust not to vary the undertaking.

Senior counsel for the applicants argued that, even if Kennedy J applied the correct test, there was no basis for her to have found that the continued enforcement of the undertakings was unjust. He submitted that the undertakings were freely given and formed part of the reasoning of Digby J. He further submitted that there was no evidence as to why IBAC gave the undertakings and why it sought to be released from them.

The applicants contended that Kennedy J was wrong, at para 100 of the Undertakings Judgment, to conclude that there was some ambiguity about the scope of IBAC’s undertakings.[39] This was said to be for four reasons. First, Digby J offered IBAC’s lawyer, CD, the opportunity to seek more time before hearing HJ’s injunction application, but he declined to do so. Secondly, the undertakings were given as part of a contested hearing. Thirdly, the express powers of IBAC are in general terms and do not preclude the undertakings operating in relation to documents which IBAC was arguably not entitled to seize under the two warrants. Fourthly, in the light of IBAC’s letter referred to at [36] above and the transcript of the hearing before Digby J, IBAC showed a clear intention to give an undertaking that it would not inspect the seized documents until after the applicants had an opportunity to make their irrelevance claims and it had considered those claims.
[39]See [63] above.

The applicants argued that Kennedy J was wrong, at para 98 of the Undertakings Judgment, to find, effectively in the alternative, that there had been a change in circumstances.[40] According to them, she took into account matters which she was not permitted to take into account. They submitted that the making of irrelevance claims by them was not a change in circumstances because making such claims was specifically envisaged by IBAC’s undertakings. They further submitted that the making of privilege claims by them was not a basis for releasing IBAC from the undertakings insofar as they concerned irrelevance claims. They contended that it was wrong for Kennedy J to consider the number of irrelevance claims — namely, 15,200 — in isolation from the total number of documents seized.
[40]See [62] above.

Further, the applicants argued that it was wrong for Kennedy J to rely upon the period that had transpired as a relevant change in circumstances, without making a finding about the reasons for the delay and who was at fault. It was said that, if the delay was substantially caused by IBAC, it should not be permitted to rely upon the delay as a relevant change in circumstances. They submitted that such findings could not be made because there was no evidence as to the length of time required for the determination of the irrelevance claims that was contemplated by either or both of the parties at the time the undertakings were given.

IBAC submitted that Kennedy J applied the correct test for the release of a party from an undertaking given to the Court. It contended that, contrary to the applicants’ submissions, paras 37 to 38 of the Undertakings Judgment were consistent with the decision of Adam P Brown.[41]
[41](1981) 148 CLR 170; [1981] HCA 39. See [59]–[60] above.

IBAC argued that the applicants had failed to explain how their formulation of the test was consistent with the discretionary nature of the court’s powers and how it would allow the court to remain in control of its interlocutory orders. According to IBAC, the words ‘inter alia’ enabled the interests of justice to be taken into account.

IBAC submitted that Kennedy J did not err in finding, at para 38 of the Undertakings Judgment, that a consideration relevant to the exercise of her discretion was the fact that a public function would be frustrated unless a statutory office‑holder was relieved of his or her undertaking.[42] IBAC contended that the applicants were incorrect to submit that a court not only has the power, but ought to exercise its discretion, to permit court orders to frustrate a statutory office-holder’s performance of statutory functions.
[42]See [60] above.

IBAC argued that the applicants’ construction of the undertaking had the effect of changing the person who was vested with the function of determining whether certain seized documents were relevant to the investigation. According to IBAC, it sought to be released from the undertakings so that it would be the person who determined relevance, in accordance with the IBAC Act.

IBAC submitted that Kennedy J did not err in finding, at para 98 of the Undertakings Judgment, that circumstances had changed since Digby J’s Injunction Judgment.[43] It was said that, for nearly a year, the applicants had been given the opportunity to raise any issues about relevance.
[43]See [62] above.

According to IBAC, there was no evidence that its undertakings were given freely and without equivocation. Rather, it contended that the undertakings were offered during a contested hearing and IBAC disputes that they were intended to bind IBAC in the way contended by the applicants.[44]
[44]IBAC relied upon CD’s affidavit of 22 June 2020, which is set out at [45] above.

In response to questions from the Bench, counsel for IBAC argued that, to the extent that the undertakings were construed as applying the same regime to relevance as they do to privilege, the undertakings were given by mistake or were ambiguous. Counsel submitted that, if the applicants’ framing of the test in Adam P Brown was correct, unjust circumstances were established by that mistake. Alternatively, counsel contended that ambiguity was another head for release of an undertaking captured by the words ‘inter alia’.

Principles relevant to grounds 1 and 2

The principles relevant to a variation or discharge of an interlocutory injunction apply equally to an undertaking which is given by a party to the court in lieu of an interlocutory injunction being made against it. For these purposes, a variation includes a change which has the effect of partially releasing a party from its obligations in an interlocutory injunction or undertaking. For convenience, the discussion that follows will focus on undertakings given in lieu of an interlocutory injunction. References to variation of such an undertaking are intended to include a full or partial discharge of the undertaking.

An undertaking given in lieu of an interlocutory injunction prohibits the party giving it from engaging in specified conduct pending the hearing and determination of the substantive proceeding between the parties. It is obviously interlocutory, rather than final.

The passage from Adam P Brown set out at [65] above, upon which the applicants relied, was preceded by observations which gave the passage context. The entire statement was as follows:

Considerable argument was directed to the question whether a court has power, otherwise than in the case of mistake operative at the time of giving it to release a party from an undertaking, at least in the absence of the consent of the other party. But in our opinion a court undoubtedly has such a power. Just as an interlocutory injunction continues ‘until further order’, so must an interlocutory order based on an undertaking. A court must remain in control of its interlocutory orders. A further order will be appropriate whenever, inter alia, new facts come into existence or are discovered which render its enforcement unjust. Of course, the changed circumstances must be established by evidence.[45]

[45](1981) 148 CLR 170, 177–8; [1981] HCA 39 (citations omitted).

Four observations may be made about the above statement. First, in order for an undertaking to be varied, there must be evidence before the court which establishes that enforcement of the undertaking, in the terms given, would be unjust. Secondly, enforcement of an undertaking, in the terms given, could be unjust where a mistake was operative at the time it was given, or where new facts come into existence or are discovered. Thirdly, the High Court’s reference to mistake, in conjunction with the words ‘inter alia’, indicate that mistake and change in facts or circumstances are not the only bases upon which enforcement of an undertaking, in the terms given, could be unjust. Fourthly, the High Court’s statement that a court must remain in control of its interlocutory orders indicates that the principles to be applied in determining whether to vary an undertaking must be sufficiently flexible to enable the court to ensure that the interests of justice are served in the circumstances of each case.

In our opinion, consistently with the above observations, the relevant principle is that a court may vary an undertaking if the party who gave it establishes by evidence that, in the circumstances that prevail at the time the variation is sought, the interests of justice require that the variation be made in order to avoid enforcement of the undertaking being unjust. The primary qualifying circumstance that may engage the principle is a change in facts since the undertaking was given. Other qualifying circumstances that may engage the principle include a change in the law, mistake and fraud.

There is no exhaustive list of qualifying circumstances that may engage the principle, and it would not be appropriate for us to propose one. However, we see no reason why the principle could not be engaged where the party who gave the undertaking can establish that its enforcement would be unjust because, in its practical application, a genuine dispute has arisen as to the scope of the undertaking. Such a dispute will usually arise due to an ambiguity in the meaning of the undertaking. A genuine dispute as to the scope of an undertaking can be a qualifying circumstance that may engage the principle because the consequences of a breach of an undertaking can include punishment for contempt of court. It is in the interests of justice for genuine doubts as to the scope of an undertaking to be removed so that its terms are clear and there is certainty about what conduct would constitute a breach.

The principle set out at [87] above is consistent with Adam P Brown. It is also broadly consistent with the cases of Xiao[46] and Just Group[47] upon which Kennedy J relied in the present case. The principle is also consistent with the constrained approach that the courts adopt to applications to discharge or vary interlocutory orders or undertakings given by a party pending the determination of a proceeding. Whilst such orders or undertakings do not create an estoppel or res judicata, a party cannot seek to vary an undertaking simply because the party has changed its mind or compliance has caused inconvenience. Unless a qualifying circumstance exists, it is in the public interest that there be finality to the disposition of interlocutory proceedings.[48]
[46][2012] NSWSC 1210, [10].
[47][2016] VSC 614, [87]–[88].
[48]Brimaud v Honeysett Instant Print Pty Ltd (1988) 217 ALR 44, 46–7; AED Oil Ltd v Puffin FPSO Ltd [No 5] [2011] VSC 60, [43]–[44].

We accept that this Court made observations in Mulvany which do not fully reflect the above analysis. However, those observations must be considered in the context of the issues before the Court in that case and the manner in which they were argued by the parties.

As this Court stated, the proceeding in Mulvany had ‘a complex and tortuous history’.[49] The plaintiffs were Hive & Wellness Australia Pty Ltd (‘HWA’) and its CEO, and the defendant was Simon Mulvany. HWA produced honey and Mulvany was an operator of social media platforms. On 15 February 2016, the plaintiffs commenced a proceeding in the Supreme Court of New South Wales against Mulvany seeking injunctions to restrain him from posting on his social media platforms damaging allegations against the plaintiffs and HWA’s honey products. On 23 February 2016, Campbell J made interlocutory orders by consent which noted undertakings given by Mulvany. The undertakings, among other things, restrained Mulvany from publishing various matters relating to the plaintiffs until the final hearing or further order of the court.
[49]Mulvany [2019] VSCA 122, [9].

The proceeding was listed for trial on 25 May 2017. On that day, Mulvany sought an adjournment. Rothman J granted the adjournment but, at the plaintiffs’ requests, made an order restraining Mulvany from publishing certain matters. That order was based in part upon the earlier undertaking given by Mulvany. On 1 September 2017, Mulvany successfully applied to vary one aspect of the restraining order. On 30 May 2018, the proceeding was transferred to the Supreme Court of Victoria.

On 3 September 2018, the mainstream media published items concerning the testing of honey for adulteration. On 21 September 2018, Mulvany applied to vary the restraining order of 25 May 2017 — by deleting some of the restraints — on the basis that the mainstream media publicity constituted a change in circumstances. On 9 November 2018, John Dixon J dismissed the application. He held that the mainstream media publicity did not constitute a material change in circumstances. He also held that, whilst Mulvany would be free to engage in public discussion about methods of testing and other safety issues relating to honey, he would continue to be restrained from making the prohibited allegations against the plaintiffs. Mulvany then unsuccessfully sought leave to appeal against that decision.

At the hearing of the application for leave to appeal, Mulvany’s solicitor advocate appeared to concede that changed circumstances had not occurred. However, he submitted that a change in circumstances was not a ‘mandatory requirement’ and that there was a higher principle, namely, the interests of justice that entitled Mulvany to fully engage in public debate concerning the safety of honey.[50] It was in the context of addressing that so-called ‘higher principle’ that the Court made the following observations:
[50]Mulvany [2019] VSCA 122, [57].

We do not accept that there is a higher principle as submitted by [Mulvany], or if there be such a principle, that it operates in the manner suggested. The authority relied on by [Mulvany’s solicitor advocate] was cited by [John Dixon J]:
23The relevant principles were not in dispute. In Liu v The Age, McColl JA said:

The constrained approach courts take to permitting interlocutory orders to be revisited reflects the proposition that a court must remain in control of its interlocutory order but, too, that a further order will be appropriate whenever inter alia, new facts come into existence or are discovered which render its enforcement unjust.

This is not authority for the proposition that interlocutory orders may be revisited absent changed facts. If the higher principle is to be understood as a reference to the unjust enforcement of the interlocutory orders, this must, as the paragraph cited confirms, arise out of new facts. Although the cited passage uses the words ‘inter alia, new facts’ it does not contemplate a situation in which effectively nothing changes. If there is no change then there is no occasion to revisit the interlocutory order.[51]

[51]Mulvany [2019] VSCA 122, [66]–[67] (citations omitted).

The Court was undoubtedly correct in rejecting the vague and general ‘higher principle’ that was advanced in Mulvany. The observations the Court made in doing so do not purport to comprehensively state the relevant legal principles and it would be inappropriate to construe them as if they formed part of a statute. As Handley JA said in Donellan v Watson:

[E]very judgment must be read as applicable to the particular facts proved, or assumed to be proved, since the generality of the expressions which may be found there are not intended to be expositions of the whole law, but governed and qualified by the particular facts of the case in which such expressions are to be found.[52]

[52](1990) 21 NSWLR 335, 343, quoting Quinn v Leathem [1901] AC 495, 506. See also Cassell & Co Ltd v Broome [1972] AC 1027, 1085; Cain v Glass [No 2] (1985) 3 NSWLR 230, 248.

It follows that the observations this Court made in Mulvany for the purpose of addressing a particular submission in that case should not be treated as establishing any general principle of law. The principle to be applied is that set out at [87] above.

A decision to vary an undertaking is a matter of practice and procedure and thus an appellate court should exercise caution in determining a challenge to such a decision.[53]
[53]Adam P Brown (1981) 148 CLR 170, 176–7; [1981] HCA 39.

Decision on grounds 1 and 2

The judge’s reasons set out at [59]–[63] above are broadly consistent with the principles we have outlined. Accordingly, the judge did not fail to apply the correct test for the release of a party from its undertakings. It follows that ground 1 is not made out.

In our opinion, the judge was correct to conclude that variation of IBAC’s undertakings was warranted. That is because a genuine dispute arose between IBAC and the applicants about the scope of the undertakings which required resolution in order to remove the uncertainty as to their scope. IBAC’s position was that the undertakings did not restrain it from inspecting seized documents that were the subject of irrelevance claims, whereas the applicants contended that the undertakings did so.

IBAC’s contention that the undertakings did not prevent it from inspecting seized documents that were subject to irrelevance claims is supported by the fact that no such restraint is expressly included in the undertakings. Paragraph (i) of the undertakings refers to making copies, para (ii) refers to dissemination and para (iii) refers to who is to have access to the seized documents after they are ‘determined or agreed to be either privileged or irrelevant’. Paragraph (iii) is silent on the process by which it will be determined or agreed whether a seized document is either privileged or irrelevant. That silence is explicable in relation to privilege because s 97 of the IBAC Act sets out the procedure for resolving privilege issues, but is not explicable in relation to relevance. This further supports IBAC’s contention.

On the other hand, the fact that the undertakings refer to both privilege and relevance provides some support for the applicants’ contention that the undertakings contemplate that the same process is to be followed to resolve both issues. The fact that s 97 of the IBAC Act is confined to privilege issues does not necessarily undermine this contention. That fact arguably supports the contention because the existence of the statutory regime in relation to privilege would diminish the value of the undertakings if they were construed as being inapplicable to the process of resolving irrelevance claims. The fact that reference was made to both privilege and relevance in the correspondence that preceded the hearing before Digby J and the discussions at the hearing may also add some support to the applicants’ contention.

In our opinion, on their proper construction, the undertakings in their original form did not prevent IBAC from inspecting seized documents that were subject to irrelevance claims. The undertakings need to be construed objectively by reference to their terms and the circumstances prevailing at the time they were given. The subjective intentions of the parties cannot affect their construction. The objective factors referred to at [100] above strongly support our construction of the undertakings.

The factors supporting the applicants’ contention that the undertakings prevented IBAC from inspecting seized documents that were subject to irrelevance claims are unpersuasive. In circumstances where the undertakings do not expressly prevent IBAC from inspecting such documents, it is not possible to construe them as if they did so on the basis of those factors. The applicants’ construction of the undertakings, in substance, would involve implying a restraint into the undertakings which is not expressly included. In the light of the potentially serious consequences of a breach of an undertaking, implying such a restraint would not be appropriate.

Notwithstanding our conclusion at [102] above, the applicants’ construction of the undertakings is not fanciful. That construction was sufficient to create a genuine dispute between the parties as to the scope of the undertakings which needed to be resolved.

The status of the statements made by CD at the hearing before Digby J, which are set out at [38] above, is unclear. Ordinarily, where undertakings are given orally and are recorded in a court order, the undertakings as recorded in the order are the operative undertakings and supersede anything stated orally. That is so for the obvious reason that the undertakings need to be recorded in precise terms rather than being left to be deciphered from a dynamic exchange between counsel and the bench. In the present case, the statements made by CD are not reflected in Digby J’s order. Insofar as the statements used the language of an undertaking, they clearly convey that IBAC had already undertaken not to examine any of the seized documents until HJ had an opportunity to make a claim for privilege. Although the statements also refer to claims of irrelevance, it cannot be said with any degree of confidence that CD undertook on behalf of IBAC that IBAC would not inspect seized documents that HJ claimed were irrelevant until such claims were resolved.

The letter from IBAC’s legal manager to the applicants’ solicitors, which is referred to at [36] above, appears to contain a proposal that IBAC will deal with claims of irrelevance in the same manner as claims of privilege. However, there is no evidence that agreement was reached between the parties on the terms set out in that letter.

A consideration of the undertakings set out in Digby J’s order in the context of CD’s statements and the letter from IBAC’s legal manager reinforces our conclusion that a genuine dispute arose between the parties as to the scope of the undertakings which required resolution.

The existence of the genuine dispute meant that it was in the interests of justice that the undertakings be varied to avoid the unjust result that would arise if the undertakings were to be enforced otherwise than in accordance with their proper construction. The variation of the undertakings set out in Kennedy J’s order dated 1 September 2020 avoids such an unjust result. That is because the variation removes the doubt that had arisen as to whether the undertakings restrained IBAC from inspecting seized documents that were subject to irrelevance claims and enabled them to be enforced in accordance with their proper construction.

Even if we are wrong about the construction of the undertakings and it is assumed that they unambiguously restrained IBAC from inspecting seized documents that were subject to irrelevance claims, Kennedy J was correct to vary them. That is because, as found by her, there was a change in circumstances since the undertakings were given, namely, the stalling of IBAC’s investigation due to the ongoing dispute over the irrelevance issue.

The IBAC Act does not oblige IBAC to refrain from inspecting a document that is claimed to be irrelevant. On the contrary, s 91(3) authorises the person executing a search warrant to form a reasonable view on whether a document is relevant for the purpose of deciding whether to seize it or make a copy of it. Logically, that person may inspect a document to form a view about its relevance unless the nature of the document is such that relevance is apparent without the need for an inspection. To the extent that IBAC restricted its rights of inspection beyond what the IBAC Act required, it did so voluntarily in order to resolve the injunction proceeding and facilitate the progress of its investigation.

However, in practice, the voluntary restriction has had the opposite effect of impeding IBAC’s investigation. In saying that, we are not attributing any fault to the applicants or calling into question the appropriateness of any action they have taken. We are merely observing that, as a matter of fact, the voluntary restriction has given rise to disputes between the parties which have impeded the timely progress of IBAC’s investigation. That situation, which prevailed at the time that IBAC applied to vary the undertakings, was materially different to the situation that prevailed at the time the undertakings were given. The change in circumstances meant that the interests of justice required that the undertakings be varied in order to avoid their enforcement in their original form being unjust.

We accept that Digby J relied upon the giving of the undertakings in dismissing HJ’s application for an injunction. However, he did so predominantly on the question of the balance of convenience rather than on the question of whether there was a serious issue to be tried. In any event, given that the voluntary restriction went beyond the requirements of the IBAC Act, the fact that Digby J relied upon the undertakings is not an insurmountable impediment to their variation.

The applicants’ emphasis on whether Kennedy J erred in distinguishing Mulvany from the present case is misplaced. The question is not whether the present case is similar or dissimilar to Mulvany. Rather, it is whether IBAC has established that there was a qualifying factor in the present case such that the interests of justice required that its undertakings be varied in order to avoid their enforcement being unjust. In our opinion, for the reasons set out above, IBAC has done so.

It follows from the above discussion that even if, contrary to our conclusion at [87] above, the correct principle is that the only basis upon which a court may vary an undertaking is a change of circumstances, that principle was satisfied in the present case.

For the above reasons, we are not satisfied that Kennedy J’s exercise of the discretion to vary IBAC’s undertakings miscarried in any way.

Accordingly, ground 2 is not made out.

Grounds 3–7: Application of Charter to construction of s 91 of IBAC Act
Kennedy J’s reasons relevant to grounds 3–7

Kennedy J held that two features were clear from a reading of the ordinary meaning of the words in s 91 of the IBAC Act:[54]

(a)The persons authorised to execute a search warrant are given a broad right to ‘inspect’ any documents located at the relevant premises, so that they can make the determinations as to ‘relevance’ provided for in s 91(3)(b) and (c). As IBAC properly accepted, there are limits on its powers to inspect documents which, on no basis, could be relevant to an investigation.[55]
(b)The determination as to relevance in relation to s 91(3)(b) and (c) is that of the persons authorised to execute the warrant, not the subject of the warrant, although that determination could be challenged.[56]

[54]Undertakings Judgment [77].

[55]Undertakings Judgment [78].

[56]Undertakings Judgment [79].

Kennedy J found that, although s 91(3)(a) of the IBAC Act required that seized documents must be located ‘at those premises’, the practicalities involved with voluminous documents mean that inspection of the documents does not necessarily take place at the premises but is an ongoing process.[57] She relied upon the following statement by Mason J in Baker v Campbell:

In approaching the scope of the authority given by the warrant we must keep practical considerations steadily in mind. It is simply impossible for a police officer executing a warrant to make an instant judgment on the admissibility, probative value or privileged status of the documents which he may encounter in his search. Generally speaking, it is in the course of the subsequent investigation following seizure of the documents that informed consideration can be given to the documents and an assessment made of their worth or significance in the respects already mentioned.[58]

[57]Undertakings Judgment [80]–[81].

[58](1983) 153 CLR 52, 83; [1983] HCA 39.

Kennedy J held that the legislative intention that IBAC inspect documents subject to a ‘relevance claim’ was strengthened by the terms of s 97 of the IBAC Act, which make express provision for the circumstances which apply to prevent an inspection where a claim of privilege is made. She stated that the failure of the IBAC Act to provide for a prohibition against inspection in relation to ‘relevance claims’ fortifies a construction that inspection may proceed.[59]
[59]Undertakings Judgment [82].

Kennedy J accepted that statutory provisions must be interpreted in a way that is compatible with ‘human rights’, so far as it is possible to do so consistently with their purpose, under s 32(1) of the Charter.[60] She then stated (at para 84 of the Undertakings Judgment) that, ‘consistent with established authority, [she] consider[ed] that s 91 [of the IBAC Act] has already struck the relevant balance between the rights to privacy and the need for an effective investigation’. Also at para 84 of the Undertakings Judgment, Kennedy J relied upon the following passage in Smethurst v Commissioner of Police:

[I]n prescribing conditions governing the issue of search warrants the legislature has sought to balance the need for an effective criminal justice system against the need to protect the individual from arbitrary invasion of their privacy. A person’s interest in privacy is recognised in all modern bills of rights and it has achieved a status in international human rights law.
It may be accepted that the balance struck by the legislature to a greater extent favours the public interest in the investigation and prosecution of crimes.[61]

[60]Undertakings Judgment [83].

[61](2020) 376 ALR 575, 583 [24]–[25]; [2020] HCA 14 (‘Smethurst’) (citations omitted).

Kennedy J did not accept the applicants’ construction of s 91 of the IBAC Act, namely, that IBAC was prevented from inspecting any seized documents unless and until the subject has agreed that the documents are relevant (or some other unidentified process has determined them to be such).[62] Rather, she considered that — at least where it is not plainly obvious — IBAC is empowered to inspect a document prior to determining whether the document is, or ought, to be copied or retained.[63] She stated that this construction is also consistent with the terms of the two warrants, which empowered the persons authorised to execute them to ‘inspect any document or thing’ prior to making copies and taking possession of the documents relevant to the investigation.[64]
[62]Undertakings Judgment [85]–[86].
[63]Undertakings Judgment [86].
[64]Undertakings Judgment [87].

Kennedy J held that, if IBAC’s undertakings are read as preventing it from inspecting the documents the subject of ‘relevance claims’, then this would be contrary to the terms of the powers given to IBAC under the IBAC Act.[65]
[65]Undertakings Judgment [88].

In para 91 of the Undertakings Judgment, Kennedy J found that IBAC’s foreshadowed inspection of the seized documents would not constitute an ‘unlawful or arbitrary’ interference with PQ’s privacy under s 13 of the Charter. That was because the inspection was expressly authorised by both the IBAC Act and the warrants. She reiterated that the High Court had stated in Smethurst that the form of a provision such as s 91 of the IBAC Act already balances and takes into account the need to protect the individual from ‘arbitrary’ invasion of their privacy rights.

She then stated as follows:

92Even if the right is engaged, I am further satisfied that the limitations placed on the privacy right can be justified having regard to the matters contained in s 7(2) of the Charter. Thus, consistent with the overarching purpose contained in the Civil Procedure Act 2010 (Vic), the [applicants] have been given opportunity to make their relevance claims. [PQ’s] rights will thereby only be affected where there is disagreement. [PQ] would also retain the right to challenge any determination subject to usual administrative law principles.
93The extensive opportunity provided to the [applicants] to make their claims also means that I am unable to be satisfied that there has been any failure to give proper consideration to the privacy right under s 38(1) [of the Charter].
94It is therefore unnecessary to consider the exception raised in s 38(2) of the Charter. However, if it is necessary to resolve, I consider that it would be generally unreasonable to expect IBAC to make a decision on a disputed relevance claim absent an inspection, save where it was clearly apparent that it could not be relevant to the investigation.
95I am therefore not satisfied that the proposed release of the undertakings would involve a breach of the Charter.[66]
[66]Undertakings Judgment [92]–[95].

Terms of grounds 3–7

Grounds 3–7 are in the following terms:

3The primary judge erred by misdirecting herself as to, or failing to examine, the meaning of, the right to privacy in s 13 of the Charter, including the meaning of an arbitrary interference with the right.
4The primary judge erred by failing to interpret …s 91 of the [IBAC Act] in a way that is compatible with human rights in accordance with s 32 of the [Charter], including by:
(a)finding at [84] of the [Undertakings Judgment] that s 91 of the IBAC Act ‘has already struck the relevant balance between the rights to privacy and the need for an effective investigation’; and
(b)relying on the passage from Smethurst …, which is extracted at [84] of the [Undertakings Judgment], because the legislation there under consideration was not subject to the requirement of s 32 of the Charter.

5The primary judge erred by finding at [95] [of the Undertakings Judgment] that releasing [IBAC] from the undertakings would not involve it breaching the Charter, in particular by:
(a)conflating the terms upon which a warrant may be issued under s 91 of the IBAC Act and the manner in which seized documents are to be dealt with having regard to the requirements of s 38 of the Charter;

Section 38(1) of the Charter — which prohibits public authorities from acting in a way that is incompatible with a human right or failing to give proper consideration to a human right in making a decision — imposes an obligation upon public authorities to consider applicable human rights when exercising their statutory powers. That obligation is additional or supplementary to any obligation imposed under the primary legislation governing the operations of the public authority.[92]
[92]Bare (2015) 48 VR 129, 234 [323], 236 [326]; [2015] VSCA 197.

For a decision-maker to give ‘proper’ consideration to a relevant human right in compliance with s 38(1) of the Charter, he or she must: (1) understand in general terms which of the rights of the person affected by the decision may be relevant and whether, and if so how, those rights will be interfered with by the decision; (2) seriously turn his or her mind to the possible impact of the decision on a person’s human rights and the implications for the affected person; (3) identify the countervailing interests or obligations; and (4) balance competing private and public interests as part of the exercise of justification.[93]
[93]Castles (2010) 28 VR 141, 184 [185]–[186]; [2010] VSC 310; Bare (2015) 48 VR 129, 198–9 [217]–[221], 218–23 [277]–[289], 297–8 [535]–[536]; [2015] VSCA 197.

Decision on grounds 3–7

Before we address grounds 3–7, it is necessary to provide context for the issues that have been raised in relation to them.

The first contextual matter is that Kennedy J was not dealing with the substantive judicial review proceeding, but rather the interlocutory summons issued by IBAC to vary its undertakings. Accordingly, the validity of IBAC’s investigation — which is the principal issue in the substantive proceeding — was not before Kennedy J. The key issue raised by IBAC’s summons was whether the principles for variation of an undertaking had been satisfied. That issue was informed by the proper construction of s 91 of the IBAC Act, considered in the light of the Charter.

The second contextual matter is that, in the interlocutory proceeding before Kennedy J, the validity of the search warrants and the manner in which the documents had been seized pursuant to the warrants was not challenged. Rather, what was being challenged was IBAC’s proposal to inspect the seized documents prior to the resolution of the applicants’ irrelevance claims.

The third contextual matter is that the items that were seized pursuant to the search warrants were largely computers and electronic devices which contained multiple documents, rather than discrete hard-copy documents. It was not in dispute that the nature and quantity of the items seized made it impracticable for IBAC’s officers who executed the warrants to assess whether any particular electronic documents were privileged or irrelevant at the time of seizure and that that assessment would need to be conducted subsequently. Inevitably, the process that was followed will have resulted in the seized items containing some documents which were privileged or irrelevant to IBAC’s investigation.

The fourth contextual matter is that there is no dispute between the parties that any documents that form part of the seized items which are not relevant to IBAC’s investigation cannot be used by IBAC for the purposes of the investigation. That is so whether a document is irrelevant because it relates to a matter of privacy concerning PQ or for any other reason. In other words, the engagement of the right to privacy in s 13(a) of the Charter is not a precondition to a document being assessed as irrelevant and beyond IBAC’s power to use it for the purposes of its investigation.

The fifth contextual matter is that the right to privacy in s 13(a) of the Charter will not be engaged for any documents relating exclusively to HJ. That is because the Charter applies only to human beings.[94] Also, s 13(a) will not be engaged for any documents relating to PQ which do not relate to a matter falling within the privacy right in that section. It follows from the above that the Charter will not be engaged in relation to all of the applicants’ claims of irrelevance, but only insofar as those claims concern documents which affect PQ’s privacy.
[94]See [25] above.

The sixth contextual matter is that, for the purposes of the right to privacy in s 13(a) of the Charter, grounds 3–7 seek to challenge Kennedy J’s finding that IBAC will not be acting arbitrarily by inspecting the seized documents prior to resolution of PQ’s claims of irrelevance based upon privacy. However, the applicants have not alleged that IBAC has in fact acted arbitrarily in relation to any particular document that engages the right to privacy in s 13(a). Rather, the applicants’ complaints are of a generalised nature relating to the interpretation of s 91 of the IBAC Act in the light of the right to privacy in s 13(a) and the processes to be followed by IBAC in assessing irrelevance claims in the absence of the undertakings.

Also by way of context to the issues raised by grounds 3–7, it is instructive to consider the legislative and general law legal framework within which IBAC exercises its powers to inspect and seize documents pursuant to a search warrant, before considering the impact of the Charter.

Under s 91 of the IBAC Act, IBAC officers may be authorised by a search warrant to enter premises, inspect documents, make copies of any documents they reasonably consider may be relevant to IBAC’s investigation and take possession of any documents they consider relevant to the investigation. Section 97 precludes an IBAC officer from inspecting a document which is claimed to be privileged, and sets up a procedure for resolving privilege claims. By contrast, no provision of the IBAC Act precludes an IBAC officer from inspecting a document which is claimed to be irrelevant, or establishes a procedure for resolving irrelevance claims. Rather, s 91 contemplates that an authorised IBAC officer may inspect a document in order to form a view as to whether it is relevant to IBAC’s investigation. Logically, as relevance must be determined by reference to the scope of IBAC’s investigation, IBAC’s officers are well placed to assess relevance.

Where a search warrant issued under s 91 of the IBAC Act involves a handful of discrete hard-copy documents, authorised IBAC officers may be able to assess whether particular documents are relevant at the time the warrant is executed. The relevance of some documents may not be readily apparent and could not be determined without an inspection of their contents. In such a case, IBAC officers would not be acting unlawfully or arbitrarily if they inspected the contents of the documents to the extent necessary to determine their relevance. For other documents — such as a document on the letterhead of a well-known hospital which is headed ‘medical report’ — their nature may be such as to enable an assessment of relevance to be made without an inspection of their contents.[95] In the latter class of documents, once it is apparent to IBAC officers that a document is, of its nature, irrelevant to IBAC’s investigation, they would be acting unlawfully if they continued to inspect the contents of the document or if they used the document for the purposes of the investigation.
[95]That is not to say that a medical report of that kind would necessarily be irrelevant. The scope of an IBAC investigation may be of such a nature as to render a medical report of that kind relevant to the investigation.

In the case of the execution of a search warrant in the circumstances set out at [165] above, if the owner of the documents is present during the execution of the search warrant, he or she may make claims that particular documents are privileged or irrelevant to IBAC’s investigation. As a matter of common sense, the owner is better placed to make a claim for privilege than a claim for irrelevance. That is because the former is based upon the purpose for which a document was prepared[96] — of which the owner would usually be aware — whereas the latter is based on the precise scope of IBAC’s investigation, of which the owner would not necessarily be aware.
[96]Evidence Act 2008 (Vic) ss 118, 119.

The making of a claim of privilege by the owner of a document will attract the provisions of s 97 of the IBAC Act. As we have already stated, the IBAC Act does not expressly deal with the making of claims of irrelevance. However, s 91(3) limits the power of an authorised IBAC officer to make a copy of documents to those he or she ‘reasonably considers may be relevant, to [IBAC’s] investigation’ and the power to take possession of documents to those he or she ‘considers relevant to [IBAC’s] investigation’. In assessing relevance, an authorised IBAC officer must genuinely consider claims of irrelevance made by the owner of the documents but is not bound by them, as s 91(3) requires the officer to determine relevance.

In the case of the execution of a search warrant in the circumstances set out at [165] above, the following process will apply in respect of an IBAC officer’s assessment of an owner’s claim of irrelevance:

(a)If the IBAC officer accepts the owner’s claim of irrelevance in respect of a particular document, he or she must inform the owner of that decision but need not provide any reasons. Self-evidently, the IBAC officer cannot seize the document or use it for the purposes of IBAC’s investigation.
(b)If the IBAC officer rejects the owner’s claim of irrelevance in respect of a particular document, the officer must inform the owner of that decision but not the reasons for it. Self-evidently, the giving of reasons as to how the document is relevant to IBAC’s investigation may expose IBAC’s lines of inquiry and jeopardise its investigation. If the owner is unhappy with the decision, the owner could seek to challenge it. Conventional administrative law principles would apply to such a challenge. If the owner does not challenge the officer’s decision and IBAC uses the document in its investigation, any person (including the owner of the document) who is the subject of criminal proceedings resulting from IBAC’s investigation would not be precluded from contending that the document is inadmissible under the Evidence Act 2008 (Vic).[97]

[97]See, eg, s 138 of the Evidence Act 2008 (Vic).

For reasons of practicality, the process outlined at [165]–[168] above applies in modified form in a case such as the present where there are a large number of documents which are contained in electronic devices. As we have already stated, in such a case, the devices may be seized and claims of privilege and irrelevance — and the assessment of those claims — may be made not at the time of seizure but subsequently. Nevertheless, the key features of the process outlined at [165]–[168] above apply in relation to the assessment of relevance by IBAC’s authorised officers and the consideration that they must give to any claims of irrelevance made by the owner of the documents. For example, where the electronic documents include an email from a well-known hospital with the subject matter ‘medical report’, it may be possible to assess the relevance of that email without inspecting it.[98] On the other hand, if the email is from an unfamiliar source with a blank subject line, it is more likely that an inspection will be necessary.
[98]See n 123 above.

In a case such as the present, if, after seizing electronic devices, IBAC accepts a claim by the owner of a document that it is not relevant to IBAC’s investigation, the document should be returned to the owner if it is a discrete hard-copy document. If it is an electronic document that forms part of a larger database that has been seized, appropriate steps must be taken to quarantine that document from IBAC’s investigation.

There is nothing in the above legal framework that requires IBAC to refrain from progressing an investigation until it has genuinely considered and notified a decision on claims of irrelevance. The task of considering and notifying a decision on irrelevance claims is to be undertaken as soon as practicable and in good faith, but its timing will depend on the imperatives of IBAC’s investigation and the need to protect its integrity, in order to meet IBAC’s important statutory objectives. Also, for the reasons we have already outlined, the legal framework does not require IBAC to refrain from inspecting a document until the owner has had an opportunity to make claims of irrelevance or until such claims are determined. Furthermore, in order to be effective, claims of irrelevance by an owner must be made in good faith for the genuine purpose of vindicating a legal right or interest and not by way of generalised assertions of a fishing nature made for the ulterior purpose of uncovering IBAC’s lines of inquiry in its investigation.

We now consider the impact of the Charter on the legal framework discussed above in relation to a document which engages the right to privacy in s 13(a).

If a document of a private nature is relevant to an IBAC investigation, its private nature does not exempt it from the search and seizure provisions of s 91 of the IBAC Act. Such a document may well be relevant to an IBAC investigation, depending on the subject matter of the investigation. Where a document of a private nature is subject to a claim of irrelevance, an authorised IBAC officer must give genuine consideration to that claim in determining whether the document is relevant. As part of that consideration, the officer must take into account the fact that s 13(a) of the Charter precludes unlawful or arbitrary interference with privacy and that s 38(1) prohibits conduct which is incompatible with that human right. If the officer determines that the document is irrelevant to IBAC’s investigation, he or she must inform the owner of the document of his or her determination and the processes set out at [168(a)] above will apply. If the officer determines that the document is relevant to IBAC’s investigation, the officer must inform the owner of the document of his or her determination and the processes set out at [168(b)] above will apply.

We accept that, once a document affecting privacy is inspected, the fact that the inspection took place cannot be erased. However, if the inspection was necessary for the purpose of genuinely considering a claim that the document is not relevant to an investigation, then, for the reasons we have already explained, the inspection would be appropriate. If IBAC agrees, or a court subsequently finds, that a document that was inspected is not relevant to IBAC’s investigation, then appropriate steps can be taken to ensure that the contents of the document are protected and thus to limit any interference with privacy.

It can be seen from the above analysis that, interpreting s 91 of the IBAC Act in a way that is compatible with the right to privacy in s 13(a) of the Charter, as required by s 32(1) of the Charter, does not result in any material change in the construction of s 91 of the IBAC Act. That is because the legal framework that applies independently of the Charter provides safeguards against unlawful or arbitrary interference with privacy. Further, s 7 of the Charter does not materially add anything to the analysis because the legal framework that applies provides a fair and appropriate balance between the important right to privacy and the important statutory functions performed by IBAC. Section 7 is discussed further at [193]–[194] below.

We now turn to grounds 3–7.

In our opinion, ground 3 is not made out. Kennedy J was aware that the adjective ‘arbitrary’ has a wider meaning than ‘unlawful’ because she referred to the applicants’ submissions on this issue and cited the case law upon which they relied.[99] Moreover, Kennedy J’s discussion of s 13(a) of the Charter was sufficient for the purpose of dealing with the submissions the applicants made at first instance in relation to it. As noted in IBAC’s submissions, the applicants contended at first instance that it would be arbitrary for IBAC to inspect any document regardless of whether the document had any apparent relationship to the objects of the search warrant.[100] In response to that submission, Kennedy J held that IBAC’s foreshadowed inspection of the seized documents would not constitute an unlawful or arbitrary interference with PQ’s right to privacy.[101]
[99]Undertakings Judgment [56].
[100]See [143] above.
[101]Undertakings Judgment [91]. See [123] above.

In our opinion, ground 4 is not made out.

Kennedy J acknowledged that s 32 of the Charter required that s 91 of the IBAC Act had to be construed in a way that was compatible with the right to privacy in s 13(a) so far as it was possible to do so consistently with the purpose of s 91. As set out at [123]–[124] above, she found that s 91 operated in a manner that was compatible with PQ’s right to privacy and that any limitations on that right can be justified having regard to the matters set out in s 7(2) of the Charter.

In our opinion, Kennedy J properly applied s 32 of the Charter to the construction of s 91 of the IBAC Act. Her findings are consistent with our analysis at [163]–[175] above.

At [140] above, we set out the oral submissions of senior counsel for the applicants as to how s 91 of the IBAC Act should be interpreted compatibly with the right to privacy in s 13(a) of the Charter, as mandated by s 32 of the Charter. Senior counsel stated that, interpreted in that manner, s 91 of the IBAC Act required IBAC to give genuine consideration to claims that documents of a private nature were irrelevant to IBAC’s investigation and to inform PQ of its decision on those claims.

However, as our discussion of the legal framework at [163]–[171] above indicates, on its proper construction, even in the absence of s 32 of the Charter, s 91 of the IBAC Act operates in this manner and protects against unlawful or arbitrary interference with the right to privacy. Interpreting s 91 of the IBAC Act compatibly with the right to privacy, as required by s 32 of the Charter, and having regard to the matters set out in s 7 of the Charter, does not materially affect the operation of s 91 of the IBAC Act. In that sense, Kennedy J was right to find that s 91 has already struck the relevant balance between the right to privacy and the need for an effective investigation and was justified in relying upon Smethurst.

Although Smethurst was concerned with the search warrant provisions of the Crimes Act 1914 (Cth) in circumstances where the Commonwealth does not have human rights legislation, nevertheless Kennedy J did not err in relying upon it. That is because, as the passage set out at [120] above shows, the High Court acknowledged that privacy is an important human right.

In our opinion, ground 5 is not made out.

For the reasons set out under ground 4 above, Kennedy J did not conflate the terms upon which a warrant may be issued and the manner in which seized documents are to be dealt with having regard to the requirements of s 38 of the Charter. The legal framework that we outlined at [163]–[175] above means that s 91 of the IBAC Act will operate compatibly with the right to privacy in s 13(a) of the Charter notwithstanding the variation to IBAC’s undertakings.

Once again, for the reasons set out under ground 4 above, Kennedy J was correct to find that PQ’s right to privacy will only be affected where there is disagreement between PQ and IBAC as to whether a private document is not relevant to IBAC’s investigation. That is because, if IBAC agrees with PQ’s claim that a particular document is irrelevant based on the right to privacy, IBAC could not use that document in its investigation and must either return the document if this is practicable or otherwise quarantine it. On the other hand, if IBAC does not agree with PQ’s claim, then the process set out at [168(b)] above will apply. The variation in IBAC’s undertakings will not affect this process.

Likewise, the variation of IBAC’s undertakings will not affect the limitations set out in s 91 of the IBAC Act regarding the issue or execution of search warrants. The legal framework set out at [163]–[175] above will apply in relation to claims that particular documents are not relevant to IBAC’s investigation.

There is nothing in either the IBAC Act or the Charter which requires IBAC to refrain from exercising its powers to inspect and seize documents pursuant to a search warrant unless it has given an undertaking to the owner of the documents to limit the exercise of its powers in ways that are favourable to the owner. If a particular limit is not imposed by the IBAC Act, construed compatibly with the Charter, there is no obligation on IBAC to agree to such a limit by way of an undertaking. Also, there is no obligation on IBAC to give an undertaking to an owner of a document pending an approach being made to the court by the owner to obtain administrative law remedies. If the court is persuaded that an interlocutory injunction is appropriate pending the hearing and determination of an administrative law proceeding, it can grant such an injunction on such terms as it considers appropriate in the circumstances.

The evidence indicates that the parties have had extensive communications on the applicants’ claims that particular documents are not relevant to IBAC’s investigation. The process by which those claims are assessed and determined by IBAC has not been completed, not least because of the extensive interlocutory proceedings that the applicants have instituted. IBAC is required by s 91 of the IBAC Act to deal with claims of irrelevance in the manner we have already set out. Consistently with our observations at [171] above, IBAC must be given sufficient time to do so, having regard to the volume of seized documents, the volume of claims of irrelevance and the need for IBAC to progress its investigation in accordance with its statutory duties under the IBAC Act. There is no evidence that IBAC will not comply with its legal obligations. On the contrary, CD’s affidavit of 22 June 2020 clearly indicates that IBAC takes its legal obligations seriously and has established processes to comply with them.[102] If IBAC fails to comply with its legal obligations, the applicants may seek to rely upon conventional administrative law remedies.
[102]See [45] above.

Kennedy J did not err in finding that releasing IBAC from its undertakings would not involve a breach of the Charter. There is simply no evidence that IBAC intends to deal with any privacy claims made by PQ under s 13(a) of the Charter in a manner that is inconsistent with the processes we have discussed earlier in these reasons. In particular, there is no evidence that IBAC intends to interfere with any rights to privacy by PQ in an unlawful or arbitrary manner.

In our opinion, for the reasons set out under grounds 3 and 4, ground 6 is not made out. Kennedy J’s findings are consistent with our analysis with [163]–[175] above.

In our opinion, ground 7 is not made out.

It may be accepted that IBAC’s power to inspect and seize documents pursuant to a search warrant under s 91 of the IBAC Act can result in the right to privacy in s 13(a) of the Charter being subject to a ‘limit’ insofar as the documents concern a person’s private affairs. However, it cannot be doubted that IBAC’s statutory function of investigating and, where appropriate, prosecuting those engaged in corruption underpins our free and democratic society based on human dignity, equality and freedom. Having regard to the safeguards provided by the legal framework set out at [163]–[175] above, Kennedy J was correct to find that s 91 of the IBAC Act strikes the correct balance between the right to privacy and the need for IBAC to be able to conduct effective investigations.

Section 7(2)(e) of the Charter requires that regard be had to ‘any less restrictive means reasonably available to achieve the purpose that the limitation [on the right to privacy] seeks to achieve’. As set out at [140] above, in his oral submissions, senior counsel for the applicants contended that ss 7, 32 and 38 of the Charter had the effect of imposing two obligations upon IBAC in exercising its powers under s 91 of the IBAC Act. Those obligations are to give genuine consideration to PQ’s claims of irrelevance based upon privacy and to notify PQ of its decision in respect of such claims. For the reasons we have already given, Kennedy J did not err in her consideration of ss 7, 32 and 38 of the Charter. The brevity with which Kennedy J’s reasons dealt with s 7 of the Charter was sufficient in the circumstances, as the reasons she gave in relation to s 32 also applied to s 7.

Grounds 8–11: Applicants’ claim for interlocutory injunction
Kennedy J’s decision on applicants’ claim for interlocutory injunction

Kennedy J stated that there was some confusion as to whether the issue of an extension of injunctive relief arose. She noted that the applicants submitted that she should grant the interlocutory injunctions claimed in para 3 of the summons dated 4 June 2020 because para 3 of the order of Daly AsJ would expire upon the determination of the issues in the Undertakings Judgment.[103] Kennedy J said that IBAC, on the other hand, claimed that the issue did not arise because the matter had already been heard and determined by Daly AsJ, who found that the applicants were only entitled to the limited form of injunction she granted.[104]
[103]Undertakings Judgment [101]. Paragraph 3 of Daly AsJ’s order is summarised at [47] above.
[104]Undertakings Judgment [102].

Kennedy J refused to grant further injunctive relief to the applicants, for the following reasons:

103It will be recalled that Daly AsJ gave a limited injunction on the ‘sole basis’ that there was a serious question to be tried as to whether the inspection would breach the terms of the undertakings. In circumstances where the undertakings are not to be continued (so as to prevent the inspection), there is no basis for varying the interlocutory order of Daly AsJ.
104I therefore accept IBAC’s submission that there is no basis for revisiting the orders of Daly AsJ. It was also not suggested that there were any changed facts or other circumstances to justify the making of a different order.
105However, even if this is not correct, I am not satisfied that the [applicants] have demonstrated the right to further injunctive relief.
106The [applicants] have alleged that the acts of inspection would be unlawful by reason of being contrary to the IBAC Act and the warrants and, further, in breach of s 38 of the Charter.
107However, for reasons given already I am not satisfied that any unlawfulness can be demonstrated. Given the clear words of the IBAC Act, I am not satisfied that any serious issue is raised which suggests that an inspection will be ‘unlawful’. To the contrary, I consider that IBAC is entitled to inspect the documents so as to consider the relevance issue.
108I am also not satisfied that the balance of convenience would favour the grant of further injunctive relief in circumstances where the [applicants] have already been given opportunity to be heard on their relevance claims. It is also in the public interest that the investigation proceed subject always to the limits in the IBAC Act.[105]
[105]Undertakings Judgment [103]–[108].

Terms of grounds 8–11

Grounds 8–11 are in the following terms:

8The primary judge erred in refusing to extend the injunction granted by Daly AsJ on 3 July 2020.
9The primary judge erred in finding that Daly AsJ had determined the [applicants’] claim for an interlocutory injunction in paragraph 3 of the [applicants’] summons dated 4 June 2020.
10The primary judge erred in refusing to grant the interlocutory injunction claimed by the [applicants] in paragraph 3 of the [applicants’] summons dated 4 June 2020.
11Alternatively to ground 10, [the primary judge] erred by failing to give any or any adequate reasons for refusing to grant the interlocutory injunction claimed by the [applicants] in paragraph 3 of the [applicants’] summons dated 4 June 2020.

Parties’ submissions on grounds 8–11

The applicants submitted that, on 3 July 2020, Daly AsJ did not deal with the interlocutory injunction application in para 3 of HJ’s summons dated 4 June 2020 — which sought to preserve the subject matter of the claim in para 5A of the amended originating motion[106] — and did not dismiss the summons. Instead, they contended that the injunction Daly AsJ granted related to a finding she made that there was a serious question to be tried about whether IBAC’s foreshadowed inspection of the seized documents would be in breach of its undertakings.[107] According to the applicants, the interlocutory injunction application dated 4 June 2020 remained alive when the matter came before Kennedy J. This was said to be because Daly AsJ had not ruled upon the grounds for the application relating to breach of the IBAC Act or the Charter. Consequently, the applicants argued that Kennedy J’s findings at paras 101 to 104 of the Undertakings Judgment are erroneous.[108] Further, they submitted that her statement in para 104 that ‘[i]t was also not suggested that there were any changed facts or other circumstances to justify the making of a different order’ overlooked the change of circumstances created by Kennedy J’s order varying the undertakings.
[106]See [44], [47] above.
[107]See [47(c)] above.
[108]See [195]–[196] above.

The applicants contended that Kennedy J’s alternative findings at paras 105 to 107 of the Undertakings Judgment were also erroneous because they do not consider the established test of prima facie case and balance of convenience in relation to the claim at para 5A of the amended originating motion.[109] They argued that Kennedy J erred in her findings as to the operation of s 91(3) of the IBAC Act and the effect upon it of the Charter. They submitted that, even accepting Kennedy J’s ruling in relation to the undertakings, it was nonetheless incumbent upon her to weigh those findings against the balance of convenience having regard to the following matters.

(a)The statement of this Court in Bradto Pty Ltd v Victoria that ‘the court should take whichever course appears to carry the lower risk of injustice if it should turn out to have been “wrong”, in the sense of granting an injunction to a party who fails to establish his right at the trial, or in failing to grant an injunction to a party who succeeds at trial’.[110]
(b)The fact that the applicants’ claim will be rendered nugatory by the refusal of the injunction.

[109]See [196] above.

[110](2006) 15 VR 65, 73 [35]; [2006] VSCA 89 (‘Bradto’).

According to the applicants, this case raises a novel point in the field of protection of human rights under the Charter and is precisely the type of case where the principle in Bradto should have been given full effect.

IBAC submitted that Kennedy J did not err in refusing to extend the injunction that Daly AsJ granted on 3 July 2020 or to grant a fresh interlocutory injunction. It contended that, because it was released from its undertakings, there was no serious question to be tried that the applicants were entitled to any relief to restrain IBAC from inspecting the seized documents. Accordingly, it argued that there was no ground upon which any interlocutory injunction was capable of being granted.

According to IBAC, Kennedy J did not err in finding that Daly AsJ had determined the applicants’ claim for an interlocutory injunction in the summons dated 4 June 2020. IBAC submitted that it was incoherent for the applicants to contend that, on one hand, Daly AsJ did not deal with their interlocutory injunction application whilst, on the other hand, she proceeded to order an injunction to prevent inspection of the seized documents until the determination of IBAC’s application to vary or be released from its undertakings. IBAC argued that, because Daly AsJ ordered an injunction, it follows that she determined the applicants’ claim for an interlocutory injunction.

IBAC submitted that Kennedy J did not err by failing to give any, or any adequate, reasons for refusing to grant the interlocutory injunction. It contended that, contrary to the applicants’ submissions, Kennedy J considered both the issue of serious question to be tried — at paras 105 to 107 of the Undertakings Judgment — and the issue of the balance of convenience — at para 108 of the Undertakings Judgment.[111]
[111]See [196] above.

Decision on grounds 8–11

In our opinion, ground 8 is without merit. Daly AsJ granted an interlocutory injunction which, on its terms, was to expire upon the determination of IBAC’s foreshadowed summons seeking an order that it be released from its undertakings. As a result of Kennedy J’s decision to vary the undertakings, the interlocutory injunction granted by Daly AsJ lapsed and, given that its purpose had been achieved, there was no basis for it to be extended.

We agree with the applicants’ contention that Daly AsJ did not determine their claim for an interlocutory injunction in para 3 of their summons dated 4 June 2020. That paragraph sought an interlocutory injunction restraining IBAC from inspecting the seized documents or derived information. However, as Kennedy J independently considered whether such an interlocutory injunction should be granted, any error by her in describing the precise functions that Daly AsJ had undertaken does not assist the applicants. Accordingly, ground 9, even if it is made out, does not warrant the granting of any relief to the applicants.

Ground 10 is not made out. As set out at [44] and [47] above, on 3 July 2020, Daly AsJ made an order granting the applicants leave to amend their originating motion to include a new para 5A which sought an order restraining IBAC from inspecting the seized documents or derived information until further order. However, Daly AsJ did not make any specific order in relation to para 3 in HJ’s summons dated 4 June 2020 which, as we have already stated, sought an interlocutory injunction restraining IBAC from inspecting the seized documents or derived information. Kennedy J was not satisfied that the applicants had demonstrated an entitlement to such an injunction. That is because she was not satisfied:

(a)that there was any serious issue to be tried that IBAC’s inspection of any documents would be unlawful; or
(b)that the balance of convenience favoured the grant of such an injunction in circumstances where the applicants had already been given an opportunity to be heard on relevance claims and it was in the public interest that IBAC’s investigation proceed.

Kennedy J was undoubtedly correct in refusing to grant an interlocutory injunction to the applicants. On the material before her, there was no basis for her to conclude that the principles for granting an interlocutory injunction, including those set out in Bradto, were satisfied. As we have explained at [189] above, there is simply no evidence that IBAC will deal with documents subject to claims of irrelevance — including privacy claims made by PQ — in any manner that is unlawful or arbitrary.

Ground 11 is not made out. The applicants’ case for an interlocutory injunction was so lacking in merit that Kennedy J was justified in dealing with it very succinctly in her reasons.

Conclusion

As grounds 1–7 were arguable, we will grant leave to appeal in relation to them. Leave to appeal will be refused in relation to grounds 8–11 because they were entirely lacking in merit. For the reasons set out above, the appeal will be dismissed.

Finally, we are bound to observe that it is highly regrettable that the substantive judicial review proceeding — which seeks to challenge the validity of IBAC’s corruption investigation — has stalled due to multiple interlocutory procedures. IBAC performs an important function in the public interest and it is vital that any challenges to its investigations are dealt with promptly. It is now imperative that, consistent with their overarching obligations under the Civil Procedure Act 2010,[112] the parties cooperate to ensure that the substantive proceeding can be listed for hearing by the Trial Division as soon as possible.
[112]See ss 7(1), 20, 25 of the Civil Procedure Act.

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[2021] VSCA 200

21 July 2021