Kamha v Australian Securities and Investments Commission

[2004] FCA 1668

FEDERAL COURT OF AUSTRALIA

Kamha v Australian Securities and Investments Commission

[2004] FCA 1668

PRACTICE AND PROCEDURE – interlocutory injunction – challenge to coercive statutory power – same legal issue concurrently before Full Federal Court – whether injunction should be granted pending Full Court determination or otherwise.

ASHRAF KAMHA v AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION

V 1515 of 2004

GOLDBERG J
14 DECEMBER 2004
MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 1515 of 2004

BETWEEN:	ASHRAF KAMHA Applicant
AND:	AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION Respondent
JUDGE:	GOLDBERG J
DATE OF ORDER:	14 DECEMBER 2004
WHERE MADE:	MELBOURNE

UPON THE APPLICANT BY HIS COUNSEL UNDERTAKING:

(a)to submit to such order (if any) as the Court may consider to be just for the payment of compensation, to be assessed by the Court or as it may direct, to any person, whether or not a party, adversely affected by the operation of the interlocutory order made hereafter or any continuation (with or without variation) thereof; and

(b)to pay the compensation referred to in (a) to the person there referred to.

THE COURT ORDERS THAT:

1.Until the hearing and determination of an application by the applicant to continue the injunction hereby granted beyond 5.00pm, Tuesday 21 December 2004, the respondent be restrained from proceeding with the examination referred to in the notice dated 1 December 2004, issued to the applicant by the respondent, requiring the applicant to appear at an examination at 10.00am on Wednesday, 15 December 2004 at 19‑29 Martin Place, Sydney.

2.The parties file and serve any further affidavits upon which they wish to rely and contentions of fact and law by 5.00pm on 17 December 2004.

3.The costs of the hearing this day be reserved.

4.The application to continue the injunction referred to in paragraph 1 be listed for hearing on 21 December 2004.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 1515 of 2004

BETWEEN:	ASHRAF KAMHA Applicant
AND:	AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION Respondent

JUDGE:	GOLDBERG J
DATE:	14 DECEMBER 2004
PLACE:	MELBOURNE

REASONS FOR JUDGMENT

1. [The applicant seeks to restrain the Australian Securities and Investments Commission (“the Commission”) from conducting an examination of him pursuant to s 19 of the Australian Securities and Investments Commission Act 2001 (Cth) tomorrow, 15 December 2004.] This matter has been brought on with great urgency with the Commission being called upon at very, very short notice to deal with a matter that may well have ramifications beyond this particular case. So far as the applicant is concerned I consider there is an issue that, where you have before the Court a challenge the use of a coercive statutory procedure, it is customary for any Court which is asked by any party to use that power in other cases to await the outcome of the decision of the court before being allowed to continue. [There is presently before the Full Court a challenge by Mr T Kennedy to the power of the Commission to investigate certain matters which occurred prior to the enactment of the Corporations Act 2001 (Cth) (V 917 of 2004).]

2. On the applicant’s side there is also the issue of the possibility that even if the notice is ultimately held to be invalid, if he was compelled to answer the notice, then, without knowing anything further about his involvement, there might be circumstances involving what I will call loosely “derivative use” of the material. 

3. As against that there is a public policy issue, particularly in matters of substantial allegations of either misconduct or contraventions of statute such as I understand it arise out of the HIH Royal Commission, that the investigative processes not be inhibited.  One sees that principle about interference with the criminal process identified in the passages in Jarrett v Seymour (1993) 46 FCR 557.

4. What troubles me this evening is that I have had insufficient time to look at the matter further in order to make a decision about tomorrow morning.  The Commission has been brought here with little time to prepare.  It is fair to say that senior and junior counsel for the applicant have been as diligent as they could be in the time available.  It leads me to the conclusion that unless the Commission can point to some overarching disadvantage or harm that might attend their investigative process, I should allow the applicant the opportunity to present his case, and allow the Commission the opportunity to present its case, with a greater degree of preparation than they have had today.

5. I am not disposed at this stage to grant an injunction restraining the Commission from requiring the notice to be observed until the determination of the Kennedy matter in the Full Federal Court.  I am disposed to grant an injunction for a short period of some days, in effect, as if it were an interim injunction pending the return of an application for interlocutory relief.  I do not have the required degree of satisfaction that an interlocutory injunction should be granted pending the Kennedy decision.  But as against that I have an element of disquiet about refusing the application tonight without the opportunity to hear full argument as if it were at an interlocutory stage.

6. On that basis, subject to counsel for the applicant giving the undertaking as to damages, I would be disposed to grant the relief for a short time – and I will hear counsel on this – in order to give them the opportunity to argue the matter sometime next week.  I appreciate that it comes at an inconvenient time in the calendar for the parties but that is a matter that has to give way especially in light of this matter being one which has the potential consequences that it does. 

I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Goldberg.

Associate:

Dated:             16 December 2004

Counsel for the Applicant:	Mr J D Merralls QC with Mr P Zappia
Solicitor for the Applicant:	Varrasso & Associates
Counsel for the Respondent:	Mr M R Pearce with Mr R F Pirrie
Solicitor for the Respondent:	Australian Securities and Investments Commission
Date of Hearing:	14 December 2004
Date of Judgment:	14 December 2004