MARSHALL and DEPARTMENT OF DEFENCE
[2011] AATA 566
•17 August 2011
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2011] AATA 566
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2010/0822
GENERAL ADMINISTRATIVE DIVISION ) Re PETER MARSHALL Applicant
And
DEPARTMENT OF DEFENCE
Respondent
And
ANTHONY HEATH
Joined Party
DECISION
Tribunal Mr JW Constance, Deputy President
Mr S Webb, MemberDate17 August 2011
PlaceCanberra
Decision The decision under review is set aside and in place thereof we decide that:
1. under section 42C(3) of the Administrative Appeals Tribunal Act 1975 (AAT Act), in respect of documents 1 to 20 and uncontroversial parts of document 21, it is appropriate to give effect to the terms that have been agreed and reduced to writing by the parties without dealing with those matters at hearing; and
2. under section 43 of the AAT Act, in respect of the contested exemptions in document 21:
a. the exemptions pressed by Defence in respect of paragraphs 17, 19, 41, 42, 47, 57, 72 and 74 and related headings in document 21 are correct subject only to the following exceptions which are not exempt:
i. paragraph 17, page 4 – line 5: the last three words; line 6: the first 3 words and the last 2 words;
ii. paragraph 47, page 11 – line 4: the last 7 words immediately following the word ‘said’; line 5: the first 9 words in line 5 immediately preceding the word ‘but’;
iii. paragraph 74, page 16 - the first sentence of the first dot point excluding the second and fourth words;
iv. paragraph 74, page 16 - the last line of the second dot point excluding the third and sixth words;
v. paragraph 74, page 16, fifth dot point – lines 6 to 11 inclusive except for: the 2 words immediately following the word ‘tenderer’ in line 6, the 10th word in line 6, the 7th word in line 8, the words between ‘with’ and ‘and’ in line 8, the words between ‘ascertain’ and ‘willingness’ in line 10, the word between ‘for’ and ‘to’ in line 10, the word between ‘assist’ and ‘with’ in line 10, and the last 11 words immediately following the word ‘contract’ in line 11;
vi. paragraph 74, page 17, seventh dot point – lines 4 and 5 inclusive except for the 6th, 11th and 12th words in line 4, and the 1st and 2nd words in line 5; and
b. the exemptions pressed by the joined party in respect of additional parts of paragraph 74 that are not otherwise exempt are not made out.
.
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Mr JW Constance, Deputy President
CATCHWORDS
FREEDOM OF INFORMATION - request for access to documents - exemptions claimed concerning agency operations, personal privacy and business affairs – meaning of personal information – public interest – decision varied
Administrative Appeals Tribunal Act 1975 s 42C
Freedom of Information Act 1982 ss 4, 40, 41, 43, 61, 64
Freedom of Information Amendment (Reform) Act 2010
Attorney-General’s Departmentand Australian Iron and Steel Pty Ltd v Cockcroft (1986) 10 FCR 180
Colakovski v Australian Telecommunications Corporation (1991) 29 FCR 429
Re Chandra and Minister for Immigration and Ethnic Affairs (1984) 6 ALN N257
Re Vasta & Anor and Civil Aviation Safety Authority [2010] AATA 499
Searle Australia Pty Ltd v Public Interest Advocacy Centre & Anor (1992) 36 FCR 111
REASONS FOR DECISION
17 August 2011 Mr JW Constance, Deputy President
Mr S Webb, Member1. Peter Marshall requested access to information held by the Defence Materiel Organisation (DMO) within the Department of Defence (Defence); specifically, “a report into the conduct of DMO LAND 125 MLC (Modular Load Carriage) Tender evaluation process”[1]. A number of documents were identified. These were said to be exempt from release for a variety of reasons[2]. Mr Marshall requested an internal review of that decision. An internal review decision was not made within 30 days thereafter[3]. Mr Marshall applied for review by this Tribunal[4].
[1] T3.
[2] T6.
[3] T9.
[4] T1.
2. Defence consulted a number of other affected parties about the review, as required. Anthony Heath was one of those consulted. He applied for joinder. This was granted. We understand that the views of other parties who were consulted have been taken into account when framing the exemptions claimed by Defence.
3. At this point it is convenient to note that the amending provisions of the Freedom of Information Amendment (Reform) Act 2010 commenced in accordance with the table in section 2 of that Act. Amendments made by Items set out in Part 2 of Schedule 3 and Part 1 of Schedule 4 apply to applications or requests made after the commencement of those items[5]. These amendments do not apply to the documents presently in issue.
[5] Item 39, Part 4, Schedule 3 and Item 65, Part 3, Schedule 4, Freedom of Information Amendment (Reform) Act 2010.
4. The Tribunal has before it unexpurgated copies of the documents that are within the scope of Mr Marshall’s request (the Documents). These documents were voluntarily handed up by Defence. Section 64 of the Freedom of Information Act 1982 (the Act) restricts access to these documents without further order of the Tribunal. We will refer to the Documents by number, as compiled. We note that colour coding has been used to identify the various exemptions claimed. We will refer to the colour codes when it is necessary or convenient to do so.
5. Prior to the hearing Mr Marshall and Defence asked the Tribunal to consent to alter the decision under review, in order that certain documents may be released. Mr Heath did not consent to the alteration. No alteration or additional release of information was authorised and the matter proceeded to hearing.
6. At the hearing we were informed by the parties that substantial agreement had been reached in respect of the exemptions claimed over each of the documents within the scope of Mr Marshall’s request, with the exception of exemptions claimed over parts of document 21. The agreement of the parties concerning exemptions other than those contested in relation to parts of document 21 have been reduced to writing. Without proceeding to review the exemptions that have been agreed, we note the terms of the request for consent orders under section 42C(1) of the Administrative Appeals Tribunal Act 1975 (the AAT Act) and, it being appropriate to do so without proceeding to hear these aspects of the case, we give effect to those terms.
7. That being so, the focus of the review is significantly narrowed to the contested exemptions that are claimed over parts of document 21. Those exemption claims arise in relation to parts of paragraphs 17, 19, 41, 42, 47, 57, 72 and 74 of document 21. This information is the subject of exemptions pressed by Defence under sections 40, 41 and 43 of the Act. Additionally and separately, Mr Heath asserts that parts of paragraph 74 are personal information of his and subject to exemption from release under section 41 of the Act.
8. Document 21 is a Minute setting out information relating to the investigation of allegations concerning the Modular Load Carriage (MLC) procurement tender process by the Inspector-General (Defence). The Inspector-General is a Senior Executive Service officer and head of the Fraud Control and Investigations Branch in the Audit and Fraud Control Division of Defence[6]. The role of Inspector-General sits outside the military justice system. The investigation that resulted in the creation of document 21 was conducted by Mr Jeremy Hawes of the civilian Directorate of Investigations and Recovery under the supervision of Jason Woods in the Fraud Control and Investigations Branch.
[6] Exhibit R2, page 2.
9. We note that under section 61 of the Act the onus of establishing the exemptions claimed lies, respectively, with Defence and Mr Heath.
Section 40 exemptions – operations of agencies
10. Defence says that parts of paragraphs 19, 41, 42, 47, 57, 72 and 74 and related headings in document 21 are exempt from release under sections 40(1)(a) or (b) of the Act. The particular parts of the document that are the subject of these claimed exemptions are marked in blue and grey in the Documents.
11. The specific details of each claimed exemption under this head are set out in Defence’s Schedule of Exemptions dated 1 July 2011 as amended on 15 August 2011. The exemptions claimed in respect of paragraphs 19, 47 and 72 and related headings are solely in relation to information identifying persons and organisations involved in the MLC procurement tender, whereas the exemptions claimed over paragraphs 41, 42, 57 and 74 are not confined to information of this kind and extend to other kinds of information. In paragraph 41 notes of discussions between the MLC project team and an organisation that set out details of sub-contractual arrangements in a tender bid are said to be exempt from disclosure. The contested exemptions in respect of parts of paragraph 42 concern an extract of an email that contains detailed information concerning an organisation’s MLC tender. The exemptions claimed over parts of paragraph 57 are in respect of detailed information about suppliers contacted by a tenderer in respect of a tender bid. In paragraph 74 certain observations about tenderers are said to be exempt.
12. In Defence’s submission disclosure of this information would, or could, reasonably be expected to prejudice the effectiveness of procedures and methods or the attainment of the objects of tests, examinations or audits it conducts. Specifically, Defence asserts that the procedures and methods of the Inspector-General when conducting an investigation, such as the MLC procurement investigation, involve the voluntary provision of information by participants. The Inspector-General does not have power to compel individuals or organisations outside Defence to provide information. Furthermore, the Inspector-General obtains information, expressly or otherwise, on a confidential basis, where those providing information to an investigation do so voluntarily on the expectation that confidentiality will be maintained. In Defence’s submission the release of information obtained in that manner would be contrary to the expectation of confidentiality and could reasonably be expected to constrain the future provision of information, both in terms of quality and quantity, in investigations of like kind. In future investigations prospective participants outside Defence, such as tenderers in procurement processes for example, could reasonably be expected to be less cooperative if there is a real likelihood that information provided on a confidential basis to an investigation may be publically released. This, Defence asserts, would be contrary to the public interest in it maintaining a robust system for investigating complaints about its procurement processes.
13. Mr Marshall says that it is inherently unlikely and improbable that releasing the contested information would have the effect contended for by Defence. Mr Marshall submitted that it is highly unlikely that document 21 contains the intellectual property or trade secrets of any organisation. He asserts that even if that is not correct and the information is publically released, it is highly unlikely that this would inhibit that organisation’s interest in any future tender process for the supply of MLC-type equipment, as a contract of that kind would be of significant value. In his submission it is simply inconceivable that disclosure would constrain the provision of information in future tender or investigation processes: the effect contended for by Defence lacks any credible evidence and is entirely speculative. For this reason Mr Marshall urged us to reject Mr Woods’ evidence on this point. Furthermore, he asserts that the evidence of Major-General Grant Cavenagh should not be relied upon as he was not an impartial witness and he is an advocate for Defence.
14. In Mr Marshall’s submission there is a powerful public interest in the proper conduct of Defence procurement processes and related probity issues that out-weigh any effects of disclosure on ‘commercially sensitive issues’. He asserts that section 40(1)(a) has no application in the present ‘unusual’ circumstances.
15. Under section 40(1)(a) and (b) of the Act, a document is exempt if its disclosure would, or could reasonably be expected to prejudice the effectiveness of procedures or methods for the conduct of tests, examinations or audits conducted by an agency, or the attainment of the objects of particular tests, examinations or audits conducted or to be conducted by an agency. The element of ‘prejudice’ refers to an adverse effect. For the purposes of section 40, it is not necessary to establish whether prejudice ‘would, or could reasonably be expected to’ result from disclosure on the basis of probability or possibility. The test requires us to form an opinion about whether prejudice can be expected to happen if disclosure occurs and, if so, whether that expectation is reasonably based[7]. Clearly enough, for an expectation to be reasonably based, it must arise from evidence and be within the limits of what it would be rational or sensible to expect.
[7] Attorney-General’s Department and Australian Iron and Steel Pty Ltd v Cockcroft (1986) 10 FCR 180, per Bowen CJ and Beaumont J at 190; Searle Australia Pty Ltd v Public Interest Advocacy Centre & Anor (1992) 36 FCR 111 at 122 and 123.
16. We are satisfied that the phrase ‘tests, examinations or audits’ extends to include an investigation of the kind conducted by the Inspector-General’s Directorate into allegations of misconduct, and also to the MLC procurement tender process that preceded it. The Inspector-General’s investigation sought to establish the facts and evaluate these against applicable standards in a systematic manner. The MLC procurement tender process involved the evaluation of tenders with reference to certain standards. It appears to us that both of these processes have the characteristics of ‘tests’ or ‘examinations’: these words carry their ordinary meaning in common usage.
17. It is plain enough that aspects of the evidence given by Mr Woods and Major-General Cavenagh are speculative; their evidence, in part, traverses the hypothetical territory of opinion about events that have not yet occurred and the likely prospective effects of disclosures that have not been made. But this does not render their evidence without merit or weight. Mr Woods and Major-General Cavenagh are well qualified to form the opinions expressed in their evidence about the likely effects of disclosure. The weight to be given to their opinion evidence is a matter for further consideration.
18. Major-General Cavenagh was cautious and considered when giving his oral evidence, but this does not mean that he was behaving as an advocate for Defence or that his evidence should not be relied upon. He was cross-examined and his evidence was properly tested. We found him to be a witness of truth and we have no reason to reject his evidence or to discount the weight that it should be given. The Major-General has a long experience and detailed knowledge of relevant Defence processes, and this informs the weight that should be given to his evidence. We note that Major-General Cavenagh was not directly responsible for the MLC procurement process as this occurred prior to his posting to the Land Systems Division[8].
[8] Exhibit R3, page 2.
19. Mr Woods, too, has substantial relevant knowledge and experience. He struck us as a credible and reliable witness. His evidence was properly and thoroughly tested. To our mind, his evidence should be given due weight and it should not be discounted or dismissed too readily or too lightly without a compelling reason to do so; but no such reason has arisen.
20. The Inspector-General’s investigation proceeded to obtain information from participants outside Defence on a voluntary and confidential basis. There is no evidence that the individuals and organisations concerned have consented to disclosure of the information concerning them in these proceedings; we were informed by counsel that the organisations concerned were consulted and resisted disclosure of the information. This proposition was not challenged and we accept it. We accept the evidence of Mr Woods that public disclosure of information that has been provided on the expectation of confidentiality could reasonably be expected to constrain, impede or render less likely the voluntary provision of sensitive or confidential information in future similar investigations. This, to our mind, could reasonably be expected to adversely affect or prejudice the future conduct of investigations by the Inspector-General into allegations of misconduct in Defence procurement processes.
21. We accept the evidence of Major-General Cavenagh that disclosure of information concerning the details of particular tenders and the related conduct of tenderers or associated other parties could reasonably be expected to prejudice the attainment of the objects of a future competitive tender process for MLC or similar procurement. This was foreshadowed by the Major-General in his evidence as a consequence of the former process to which these documents relate having been aborted. On his evidence, it appears that the pool of suitably qualified prospective tenderers that may be attracted to or engaged in such a procurement process is limited and, for that reason, it is highly competitive. The disclosure of information provided under an expectation of confidentiality in such a competitive market could reasonably be expected to adversely affect the willingness of organisations to collaborate in preparing tenders for or to provide detailed commercially sensitive information, including intellectual property, in the future MLC procurement process, or to participate in that process at all. We accept that Defence procurement tenders involve degrees of complexity for prospective tenderers. This includes, but is not limited to, arrangements for design, manufacture and supply contracts with third parties where factors such as capacity, capability, expertise, reliability and performance may carry significant weight. The disclosure of information concerning such factors or that exposes confidential aspects of the arrangements and deliberations between parties in a tender process could reasonably be expected to adversely affect relationships between such parties and their willingness to participate in future tender processes. Clearly consequences of this kind can reasonably be expected to prejudice the effectiveness and successful conduct of future tender processes of like kind, including the prospective MLC procurement tender as fore-shadowed by Major-General Cavenagh for example.
22. There is one further consideration under this head of exemption that requires attention. To our mind, the disclosure of the opinions of the Inspector-General’s investigator, Mr Woods, concerning issues of possible bias may be premature and could reasonably be expected to adversely affect the conduct and success of future investigations and procurement tenders of a similar character to those at the heart of this dispute. Mr Woods explained that the investigation was not a determinative process: its purpose was to find facts and to make recommendations. By his account, however, the investigation was not conducted in a manner that afforded procedural fairness to all those involved, nor was it required to do so. This is a rather surprising statement that, if true, would raise some serious questions about the conduct of the investigation and the basis on which reported ‘facts’ were found, especially in the face of controversy and conflicting accounts. It is tolerably clear to us that the investigation engaged in deliberative processes when forming the opinions that are presented as facts or as recommendations. To do so without providing those involved with procedural fairness or natural justice is troubling. It is not for us to determine whether or not the investigation was fairly or properly conducted, and we make no such finding. Nevertheless, the disclosure of ‘facts’ or opinions that may not have been properly formed, or at least which have not been fairly tested in order to provide natural justice, is, to our mind, premature and may reasonably be expected to adversely affect the voluntary participation of parties in future similar processes. It is reasonable to expect that this would prejudice the attainment of the objects of any such investigation. Furthermore, the disclosure of tender information provided confidentially to Defence and reported by Mr Hawes could reasonably be expected to prejudice the future supply of such information in future tender processes.
23. So to the detail of the claimed exemptions under this head. On balance, considering section 40(2), we are satisfied that the public interest is not served by the disclosure of information of this kind. We are satisfied that the exemptions claimed under section 40(1)(a) and (b) in respect of paragraphs 19, 41, 42, 47, 57, 72 and 74 and related headings in document 21 are well made and correct, subject only to the following exceptions in paragraph 74:
a)the first sentence of the first dot point excluding the second and fourth words;
b)the last line of the second dot point excluding the third and sixth words.
Section 41 exemptions – personal information
24. Defence says that parts of paragraphs 17, 19, 42, 47, 72 and 74 of document 21 are exempt from release under sections 41(1) of the Act. The material that is the subject of these claimed exemptions is marked in green in the Documents.
25. The specific details of each claimed exemption under this head are set out in Defence’s Schedule of Exemptions dated 1 July 2011 as amended on 15 August 2011. Defence says that the controversial parts of these paragraphs contain personal information that would be unreasonable to disclose. Mr Heath asserts that additional parts of paragraph 74 (each of the dot points marked in pen in the Documents) are exempt from disclosure under this head of exemption.
26. The section 41 personal privacy exemption applies only to the ‘unreasonable disclosure of personal information’ about a person. Section 41 requires consideration in two steps: first, one must determine whether the subject information over which exemption is claimed is ‘personal information’ of any person and, secondly, whether disclosure of this information would be unreasonable. Personal information is defined at section 4(1) – ‘personal information means information or an opinion (including information forming part of a database), whether true or not, and whether recorded in a material form or not, about an individual whose identity is apparent, or can reasonably be ascertained, from the information or opinion’. The test of unreasonable disclosure requires, essentially, a public interest consideration[9] in which regard must be had to all the circumstances, including the nature of the information that would be disclosed, the circumstances in which the information was obtained, the likelihood of the information being information that the person concerned would not wish to have disclosed without consent, and whether the information has any current relevance[10].
[9] Colakovski v Australian Telecommunications Corporation (1991) 29 FCR 429, per Lockhart J at 437-8.
[10] Re Chandra and Minister for Immigration and Ethnic Affairs (1984) 6 ALN N257 at [51].
27. With regard to the first consideration concerning ‘personal information’, we are satisfied that Defence’s assessment that parts of paragraphs 17, 19, 42, 47, 72 and 74 contain personal information is correct. The parts of these paragraphs that are marked in green in the Documents contain information about persons whose identities are apparent.
28. We do not accept Mr Heath’s submission that the additional parts of paragraph 74 that he says should be exempt from disclosure under section 41 contain personal information. These parts of paragraph 74 do not expressly identify any person. Mr Heath says that the identity of the person may reasonably be ascertained by applying the mosaic principle to information that is not exempt from release and information that is already in the public domain, most notably that reported in media articles in Exhibit PJ4. But to our mind this is not correct. Personal information is information about an individual whose identity is apparent, or can reasonably be ascertained, from the information. The information, itself, must be sufficient to permit the identity of the person to be reasonably ascertained. The information in the additional parts of paragraph 74 that Mr Heath is concerned about is not about an individual; it is about the MLC procurement tender and related processes involving the MLC project team. The information does not expressly identify any individual and it is not sufficient, of itself, to permit the identity of an individual member of the MLC project team to be reasonably ascertained. It is possible that the identity of individuals involved in the MLC project team may be deduced by inference or association on the basis of other information that is in the public domain as Mr Heath contends, but it does not follow that the information in the parts of paragraph 74 that is the subject of Mr Heath’s submission, concerning the MLC project team, is personal information of any person. We are satisfied that it is not. Even if we are wrong on this point and the identity of a person may reasonably be ascertained in the manner for which Mr Heath contends, and we make no such finding, the information is not about an individual and for that reason, too, the information is not ‘personal information’ for present purposes. The same cannot be said of other parts of paragraph 74 that Defence has identified as containing personal information about a person in which individuals are named.
29. It follows that Mr Heath’s submissions concerning personal privacy exemptions that are additional to those claimed by Defence under section 41(1) in respect to parts of paragraph 74 of document 21 are not made out.
30. With regard to the specific personal information in parts of paragraphs 17, 19, 42, 47, 72 and 74 that Defence asserts is exempt from disclosure under section 41(1), the following can be said. The information contains the names of individuals[11], financial information[12], oral statements that are attributed to participants in the investigation[13], and certain findings and opinions of Mr Hawes[14]. This information was obtained or created in the course of the Inspector-General’s investigation by Mr Hawes. That investigation followed an earlier investigation by the Inspector-General that was also conducted and reported by Mr Hawes[15]. We understand that the persons identified in this material do not consent to the release of the information about them. Mr Heath asserts that even if personal identifiers are redacted, the identity of individuals may reasonably be ascertained, contextually, by reference to other information contained in the document, as well as other documents and information that was reported in the public media. Furthermore, in his submission, it would be unreasonable to disclose this material as the investigation was not conducted in proper accordance with the applicable rules of procedural fairness. Mr Heath points to ADF Publication 6.1.3 in Exhibit PJ3, concerning administrative decision-making, and to the contents of Exhibits PJ1 and PJ2. In Mr Heath’s submission, the particular information has a critical character, but the criticisms it contains are not well founded and have not properly been tested. Mr Heath says that the information is relevant to deliberative processes that have not been resolved with finality and in those circumstances it would be misleading and prejudicial to disclose it. Plainly enough, in his submission, the subject information has present relevance.
[11] Paragraphs 17, 19, 42, 47, 72 and 74.
[12] Paragraph 17.
[13] Paragraphs 47, 72 and 74.
[14] Paragraphs 17, 72 and 74.
[15] Document 1.
31. Mr Heath’s submissions have some force. Nevertheless, the public interest in the proper conduct of the MLC procurement tender process and the proper investigation of allegations of misconduct in that process must be weighed against the public interest in preventing the unreasonable disclosure of personal information.
32. We accept that disclosure of information that is of no demonstrable relevance to deliberative processes concerning the conduct of the MLC procurement tender and that is likely to excite public curiosity about the personal affairs of identifiable persons may be unreasonable; public interest should not be confused with simple curiosity. But that is not the case here - we are satisfied that the subject information is of relevance to deliberative processes concerning the conduct of the MLC procurement tender process.
33. To our mind, the public interest in the proper conduct of procurement tenders by DMO and Defence is served by the proper investigation of allegations of misconduct in such processes, including the provision of procedural fairness to those involved. We accept that it may well be premature to disclose prejudicial personal information about a person in relation to such an investigation when related deliberative processes have not yet been finalised. That consideration has an especially sharp point as there are issues concerning the provision of procedural fairness to those who are the subject of the misconduct allegations[16]. Mr Heath informed us that these or related matters are the subject of on-going disputation that has not yet been concluded with finality. In the circumstances the public interest in the protection of personal privacy and the public interest in the proper investigation of alleged misconduct weigh against disclosure. Considering the terms of the section and all the particular circumstances, we accept that the disclosure of personal information that has not been properly tested or obtained in the course of an investigation by the Inspector-General, and that is likely to be prejudicial, may well be unreasonable.
[16] See Exhibit PJ1, pages 5 to 7, and Exhibit PJ2.
34. But that is not the end of the matter; there are two other considerations of some importance to address. Firstly, we note the contents of document 1, see paragraphs 14, 29 and 47 for example, and document 11. On this evidence, having regard to what is said in Exhibits PJ1 and PJ2, it appears that those involved in the Inspector-General’s investigation were given opportunity to respond to some, if not all, of the evidence that informed the investigator’s opinions, as expressed in document 21. To our mind, these matters are relevant considerations that should not too readily be discounted when considering the public interest in the proper investigation of allegations of misconduct in Defence procurement processes.
35. Secondly, we note that by agreement of the parties substantial parts of document 1 are not subject to exemption claims and may be released. No good or compelling reason has been raised why it would be unreasonable to disclose information of a similar character and content in document 21. Clearly, the investigation that resulted in document 1 preceded the investigation that resulted in document 21, although both investigations were conducted by the same officer under the Inspector-General. The uncontroversial information in document 1 is cast in slightly different terms to the controversial but similar information in document 21. These are matters of context, fact and degree that go to the issue of unreasonableness.
36. Carefully considering these issues and the authorities to which reference was made in the submissions of the parties, we are reasonably satisfied that it would not be unreasonable to disclose information in paragraphs 47, 72 and 74 of document 21 that is of a similar character and content to that which has already been disclosed by agreement in document 1, but it would be unreasonable to disclose personal information in these paragraphs that has not previously been disclosed and that is likely to be prejudicial in deliberative processes that have not yet been concluded with finality.
37. With regard to the personal information in paragraphs 17, 19 and 42 of document 21, we note that the parties do not press the release of the names of individuals identified in those paragraphs. To our mind, that is the correct course; having considered the competing interests we are reasonably satisfied that disclosure of such information would be unreasonable in all the circumstances.
38. Furthermore, with regard to the personal information in paragraph 17 of document 21, we are satisfied that the public interest in protecting personal privacy outweighs any interest in the disclosure of private information about the financial affairs of a person who is identified. Nevertheless, it does not follow that all of the controversial information in paragraph 17 is exempt on personal privacy grounds – the last sentence of this paragraph sets out the conclusion of the investigator and excluding the identity of a named individual this information does not raise issues of personal privacy.
39. It is for these reasons we conclude that it is unreasonable to disclose only some of the personal information in document 21 that is controversial in these proceedings. Considering the exemptions pressed by Defence under section 41(1)[17] with Mr Heath’s concurrence, we find that it is unreasonable to disclose the particular personal information in paragraphs 17, 19, 42, 47, 72 and 74, subject only to the following exceptions which are not exempt on personal privacy grounds:
a)Paragraph 17, page 4 – line 5: the last three words; line 6: the first 3 words and the last 2 words.
b)Paragraph 47, page 11 – line 4: the last 7 words immediately following the word ‘said’; line 5: the first 9 words in line 5 immediately preceding the word ‘but’; line 6: the last 18 words immediately following the word ‘stated’; line 7: all of the words immediately following the word ‘out’; line 8: all of the words immediately preceding the word ‘He’; line 10: all of the words immediately following the word ‘states’ with the exception of the 11th word; line 11: all of the words in this line.
c)Paragraph 74, page 16, fifth dot point - lines 6 to 11 inclusive except for the 2 words immediately following the word ‘tenderer’ in line 6 and the last 11 words immediately following the word ‘contract’ in line 11.
d)Paragraph 74, page 17, seventh dot point - lines 4 and 5 inclusive except for words 11 and 12 in line 4.
[17] Shown in green in the Documents.
40. As we have said, much of this material in paragraphs 47 and 74 of document 21 has a similar form and content to information that has already been disclosed, by agreement, in document 1. Even though document 1 resulted from an initial investigation by the Inspector-General and therefore provides a different context, the information in paragraphs 47 and 74 in document 21 to which we have referred does not have a sufficiently different character to justify its exemption on personal privacy grounds – the subject information in document 21 goes no further than the original information in document 1. Clearly, there are slight variations in the words used and the information in document 21 may have a different import procedurally. Nevertheless, we are not persuaded that these differences provide any sufficient basis to exempt this information in document 21 from disclosure.
41. With regard to the issues of procedural fairness Mr Heath has raised in respect of the particular information in paragraphs 47, 72 and 74 of document 21, it is clear enough from document 1 and document 11 that those involved were provided with an opportunity to respond to the specific allegations made, even though no opportunity was provided to test the evidence on which they were apparently based. While it can be accepted that aspects of the investigation may not have provided those involved with procedural fairness, it does not follow that these flaws apply to all aspects of the investigation or that all of the personal information in document 21 is ill-formed and without a proper procedural foundation. To our mind the information in paragraphs 47 and 74 that replicates similar information disclosed in document 1 is not so tainted and it is not unreasonable to disclose it in the circumstances. The information in paragraph 72 does not conform to this assessment as it contains information that has not been properly tested that is of a prejudicial character. On balance, it would be unreasonable and not in the public interest to disclose this information in the circumstances.
Section 43 exemptions – business affairs
42. Defence says that parts of paragraphs 19, 41, 42, 47, 57, 72 and 74 of document 21 are exempt from release under sections 43(1)(b) or (c)(i) of the Act. The information subject to these exemption claims is marked in orange and yellow in the Documents.
43. The specific details of each claimed exemption under this head are set out in Defence’s Schedule of Exemptions dated 1 July 2011 as amended on 15 August 2011. As can be seen, the exemptions claimed under section 43 overlap precisely with those claimed under section 40.
44. It is not strictly necessary for us to determine whether information that is exempt from disclosure under section 40 is also exempt under section 43. Thus, the only information we need to consider under this head of exemption is that which is not exempt under section 40, being:
a)the first sentence of the first dot point in paragraph 74 of document 21, excluding the second and fourth words; and
b)the last line of the second dot point in paragraph 74, excluding the third and sixth words.
45. The information in paragraph 74 sets out the opinion of the Director-General’s investigator in respect of named organisations. It appears that the businesses and organisations that are named in these paragraphs do not consent to the release of information concerning them or in which they are identified. We accept the evidence of Major-General Cavenagh that business organisations participated in the MLC procurement tender process and provided information on a commercial-in-confidence basis.
46. We note in passing that no exemption is available under section 43(1) by reason only of information concerning the business, commercial or financial affairs of an organisation represented by Mr Marshall. But information of that kind is not the only reason for exemption from disclosure.
47. The test under section 43(1)(b) concerns the reasonable expectation that disclosure would or could destroy or diminish the commercial value of information whereas the test under section 43(1)(c)(i) concerns the reasonable expectation that disclosure would or could unreasonably affect an organisation’s business, commercial or financial affairs.
48. With regard to section 43(1)(b), there is very scant evidence concerning the commercial value of the information in the parts of paragraph 74 to which we have referred. It is conceivable that evaluative information that differentiates one tender from another in a competitive process may have a commercial value. Nevertheless, it is difficult to comprehend the commercial value that would attach to this information if the identities of the organisations concerned are redacted. We are not persuaded that public disclosure of this information could reasonably be expected to diminish or destroy its commercial value if the organisations concerned are not named. Thus, the exemption claimed under section 43(1)(b) is not made out.
49. With regard to the exemption claimed under section 43(1)(c)(i), we accept that the subject information concerns the business or commercial affairs of named organisations. On the evidence of Major-General Cavenagh the public disclosure of information of this kind may be expected to affect the named organisations’ ability to engage, negotiate or conduct business with sub-contractors and suppliers: the information could reasonably be expected to be seized upon by competitors operating in the same market for Defence procurement contracts and the MLC procurement tender in particular. We accept, in a competitive market, that public disclosure of this information may be prejudicial to the business, commercial or financial affairs of the named tendering organisations when negotiating with other named suppliers, contractors and sub-tender partners. Prejudice of this kind could reasonably be expected to flow from disclosure and unreasonably affect the business and commercial affairs of the named organisations. There is a public interest in the proper conduct of Defence procurement processes and the investigation of any related allegations of misconduct that must also be considered when deciding whether the organisations would be unreasonably affected by disclosure[18].
[18] Searle Australia Pty Ltd v Public Interest Advocacy Centre (1992) 36 FCR 111 at 125; Re Vasta & Anor and Civil Aviation Safety Authority [2010] AATA 499 at [35].
50. As it appears to us, however, weighing these factors and considerations, the public interest is not served by disclosure of information identifying the organisations Mr Hawes named in his concluding opinions in paragraph 74. If the identities of the named organisations are redacted, however, we are satisfied that the balance of the information can be released without any reasonable expectation that the business or commercial affairs of those organisations would or could be unreasonably affected by the disclosure.
51. It follows that with the exception of the names of the organisations concerned, the exemptions claimed by Defence in respect of the identified parts of the first and second dot points of paragraph 74 are not made out.
Decision
52. The decision under review is set aside and in place thereof we decide that:
(A)under section 42C(3) of the AAT Act, in respect of documents 1 to 20 and uncontroversial parts of document 21, it is appropriate to give effect to the terms that have been agreed and reduced to writing by the parties without dealing with those matters at hearing; and
(B)under section 43 of the AAT Act, in respect of the contested exemptions in document 21:
(i)the exemptions pressed by Defence in respect of paragraphs 17, 19, 41, 42, 47, 57, 72 and 74 of document 21 are correct subject only to the following exceptions which are not exempt:
(a)paragraph 17, page 4 – line 5: the last three words; line 6: the first 3 words and the last 2 words;
(b)paragraph 47, page 11 – line 4: the last 7 words immediately following the word ‘said’; line 5: the first 9 words in line 5 immediately preceding the word ‘but’;
(c)paragraph 74, page 16 - the first sentence of the first dot point excluding the second and fourth words;
(d)paragraph 74, page 16 - the last line of the second dot point excluding the third and sixth words;
(e)paragraph 74, page 16, fifth dot point – lines 6 to 11 inclusive except for: the 2 words immediately following the word ‘tenderer’ in line 6, the 10th word in line 6, the 7th word in line 8, the words between ‘with’ and ‘and’ in line 8, the words between ‘ascertain’ and ‘willingness’ in line 10, the word between ‘for’ and ‘to’ in line 10, the word between ‘assist’ and ‘with’ in line 10, and the last 11 words immediately following the word ‘contract’ in line 11;
(f)paragraph 74, page 17, seventh dot point – lines 4 and 5 inclusive except for the 6th, 11th and 12th words in line 4, and the 1st and 2nd words in line 5;
(ii)the exemptions pressed by the joined party in respect of additional parts of paragraph 74 that are not otherwise exempt are not made out.
I certify that the 52 preceding paragraphs are a true copy of the reasons for the decision herein of Mr J. W. Constance, Deputy President, and Mr S. Webb, Member
Signed: ....................[sgd]...........................................................
AssociateDates of Hearing 14 and 15 June 2011
Date of Decision 17 August 2011
Counsel for the Applicant Dr C. Ward
Solicitor for the Applicant Mr A. Roberts, Tetlow Tigwell Watch Lawyers
Counsel for the Respondent Mr J. DavidsonSolicitor for the Respondent Ms L. McConnell, Australian Government Solicitor
Solicitor for the Joined Party Mr T. Lange, Hunt & Hunt
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