Kirk, P.J. v Australian Securities Commission - [1994] FCA 484

JUDGMENT No. .A ,-.,,,. 9 4
CATCHWORDS

ADMINISTRATlVE LAW - stay of proceedings pending judicial review of decision

by ASC to give notices to produce books - undertaking by ASC to enforce notices
only by invoking statutory powers of Court to order compliance - whether irreparable

injury to applicant if stay not granted.

. . . .

-ve D e w IJu dicial Re view) Act 1977 s 15(1)
1989 ss 30, S 63, S 70

vs Ltd v. South Australia (1986) 161 CLR 148

MacDonald v. Aus&&~ Securities Commksio~l (unreported, Hill J, 8 February 1994)

a1 Go vernmen t and Ethnic Affairs v. Msilanu (1992) 34

FCR 169

PETER JEFFREY KIRK and HECTOR JAMES MATTOCK v AUSTRALIAN

SECURlTlES COMMISSION

PRINCIPAL

No. NG 176 of 1994

Coram: Whitlam J
Place: Sydney
Date: 6 April 1994

RECEIVED

27 JUL 1994
FEMRAL CWRT OF
AUSIRAUA

Limited Distribution

FEDFRAL COURT OF AUSTRALIA

1 1

NEW DISTRICT REGISTRY 1 NG 176 of 1994
1
GENF&U, DIVUON )

PETER JEFFREY KIRK

First Applicant

HECTOR JAMES MATTOCK
Second Applicant
AUSTRALIAN SECURITIES
COMMISSION

Respondent

Coram: Wh~tlam J
Place: Sydney

Date: 6 April 1994

ONS FOR JUDGMENT

The applicants commenced this proceeding for judicial review of the decisions of the respondent to give to each of them a notice under S 30 of ,4ustral1an Securities

. .

1989 ("the ASC Law"). Each notice stated that it was issued:

"In relation to an investigation of a suspected contravention or contravention of sections 565, 269(7)(c), 269(8A) and /or 269(10) of the Companies (South Australia) Code I981 in relation to the management, affairs and accounts for the year ended 30 June 1990 of The Adelaide Steamship Company Limited PAdsteam") and its subsidiaries."

The applicants are partners of the firm of Deloltte Touche Tohmatsu, chartered accountants, which were Adsteam's auditors at the relevant tlme. Each notice required production of books specified as follows:

"I. AN professional indemnity insurance policies and any endorsements to those policies current at the time that the recipient notijied his insurer or broker of a claim or a potential claim arising in respect of the audit of the accounts of Adsteam for the jinancial year ended 30 June 1990 ("the I990 Adsteam Audit").
2. All correspondence behveen the recipienr and his profmswnal indemnity insurer or broker suace 29 September 1991 bz any way relating to the 1990 Adsteam Audit.
3. In the event that rhe recipient has not notified his insurer or broker of a claim or potential claim arising in respect of the 1990 Adsteam Audit, all professional indemnity insurance policies and any endonements to thosepolicies current as a the date of this notice."

Each notice requued such production on 10 March 1994. This date for production

has now been adjourned untll this afternoon.

In their application to the Court the applicants claim an order, by way of interlocutory relief under s 15(1) of the Adrnin~strative Decisions (Judicial Review) Act

1977 ("ADJR Act"), "suspending the operation of the decisions in relation to each of the

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [1994] FCA 484
Decision Date: 6 Apr 1994

CaseChat Overview and Summary

The Federal Court of Australia was called upon to determine a judicial review application brought by Peter Jeffrey Kirk and Hector James Mattock against the Australian Securities Commission (ASC). The applicants, who were partners in the firm of Deloitte Touche Tohmatsu, sought an interlocutory relief to stay the operation of notices issued by the ASC under section 30 of the Australian Securities Act 1989. These notices required the applicants to produce specific documents relating to their professional indemnity insurance policies and correspondence with their insurers regarding an audit of The Adelaide Steamship Company Limited and its subsidiaries.

The central legal issue before the court was whether the applicants could be granted an interlocutory stay pending the outcome of their judicial review application, considering the ASC's undertaking not to enforce the notices except through proceedings under section 70 of the ASC Act. The court needed to assess if the applicants would suffer irreparable injury that could not be compensated by damages if the stay was not granted.

In delivering the judgment, Justice Whitlam held that the principles governing the grant of interlocutory relief under the Administrative Decisions (Judicial Review) Act 1977 were applicable. The applicants must demonstrate a serious question to be tried, irreparable injury in the absence of an injunction, and a balance of convenience in favour of granting the injunction. The ASC conceded that there was a serious question to be tried, but the court did not find it necessary to express a view on the strength of the applicants' case. The sensitive and confidential nature of the documents sought was noted, but the court was satisfied that no irreparable injury would occur due to the ASC's undertaking to only enforce the notices through section 70 proceedings. Furthermore, the court determined that there was no evidence suggesting imminent prosecution under section 63 of the ASC Act, and any potential prosecution could be defended against if it arose. Thus, the court concluded that the applicants were not exposed to irreparable injury and denied the application for interlocutory relief.

Orders