Matthews v ASIC - [2009] NSWCA 155

No judgment structure available for this case.

Appeal Outcome: Special leave dismissed with costs by the High Court, 17 August 2009 s183/2009

New South Wales

Court of Appeal

CITATION: Matthews v ASIC [2009] NSWCA 155

HEARING DATE(S): 27 May 2009

JUDGMENT DATE:
22 June 2009

JUDGMENT OF: Tobias JA at 1; Basten JA at 151; Campbell JA at 194

DECISION: Appeal dismissed with costs

CATCHWORDS: PROCEDURE – Contempt, attachment and sequestration – Contempt – What constitutes –Disobedience of orders of court – Procedure – Difference between civil and criminal contempt – Statement of charge – Facts required to be proved to establish charge – Elements of charge – Whether information in charge comprised elements or particulars of charge – Whether all particulars of charge required to be made out for each element of charge to be proven – Evidence – Burden and standard of proof – Whether each element of charge proved beyond reasonable doubt – Interpretation – Construction of court orders – Whether primary judge erred in construing orders in accordance with definitions and terminology in Corporations Law – Whether primary judge erred in substituting a reference in orders to repealed Corporations Law for Corporations Act – Construction of phrase “undertaking a business” – Whether sending letter to 1,650 recipients containing investment advice amounted to undertaking a business of advising about and dealing in securities - APPEAL – Appeal against sentence – Grounds for interference – Whether primary judge attributed suitable weight to various matters – Bail – Application for bail – Power of Court of Appeal to grant bail in respect of committal for contempt pending determination of appeal and effect of any such grant of bail

LEGISLATION CITED: Bail Act 1978
Civil Procedure Act 2005
Companies Act 1938 (Vic)
Corporations Act 2001 (Cth)
Corporations Law
Occupational Health Safety and Welfare Act 1986 (SA)
Supreme Court Act 1970
Supreme Court Rules 1970

CASES CITED: Athens v Randwick City Council [2005] NSWCA 317; (2005) 64 NSWLR 58
Australasian Meat Industry Employees’ Union v Mudginberri Station Pty Ltd [1986] HCA 46; (1986) 161 CLR 98
Australian Securities and Investments Commission v Edensor Nominees Pty Ltd [2001] HCA 1; (2001) 204 CLR 559
Australian Securities and Investments Commission v Matthews [2009] NSWSC 77
Australian Securities and Investments Commission v Matthews [2009] NSWSC 285
Bovis Lend Lease v Construction Forestry Mining & Energy Union [2009] FCA 194; (2009) 254 ALR 306
Carew Reid & Ors v Carew Corporation Pty Ltd (Full Court of the Supreme Court of Western Australia, 23 April 1993, unreported)
Chiltern District Council v Keane [1985] 1 WLR 619
Concrete Constructions Pty Ltd v Plumbers & Gas Fitters Employees Union (No 2) [1987] FCA 117; (1987) 15 FCR 64
Coward v Stapleton [1953] HCA 48; (1953) 90 CLR 573
Diemould Tooling Services Pty Ltd v Oaten; Santos Ltd v Marcos [2008] SASC 197; (2008) 101 SASR 339

PARTIES: Stephen Lewis Matthews
Australian Securities and Investments Commission

FILE NUMBER(S): CA 40130/09

COUNSEL: A: P Taylor SC / Richard Killalea
R: D Stack

SOLICITORS: A: N/A
R: Conrad Gray, ASIC, Sydney

LOWER COURT JURISDICTION: Supreme Court

LOWER COURT FILE NUMBER(S): SC 1635/00

LOWER COURT JUDICIAL OFFICER: Barrett J

LOWER COURT DATE OF DECISION: 25 February 2009

LOWER COURT MEDIUM NEUTRAL CITATION: ASIC v Matthews [2009] NSWSC 77

CA 40130/09
SC 1635/00

TOBIAS JA
BASTEN JA
CAMPBELL JA
Monday 22 June 2009

STEPHEN LEWIS MATTHEWS v AUSTRALIAN SECURITIES & INVESTMENTS COMMISSION

Judgment

1 TOBIAS JA: By an Amended Interlocutory Application (the Application) filed in the Corporations List of the Equity Division of the Supreme Court on 8 December 2008 pursuant to Part 55 r 6 of the Supreme Court Rules 1970, the respondent, Australian Securities and Investments Commission (ASIC), sought orders that the appellant, Stephen Lewis Matthews, be found guilty of contempt of the court in that, in the manner there set out, he had contravened one or more of Orders 8, 10 and 12 made by Santow J on 4 October 2000.

2 The Application was accompanied by an Amended Statement of Charge (the Charge) which set out Orders 8, 10 and 12 and then alleged that the appellant was guilty of contempt of the Court in terms identical to those alleged in the Application.

3 The proceedings were heard by Barrett J who, on 25 February 2009, found that ASIC had made out paragraphs 2 and 5 of the Charge that alleged breaches of Orders 8 and 12. His Honour then determined that the appellant was accordingly guilty of contempt of court: Australian Securities and Investments Commission v Matthews [2009] NSWSC 77 (the February judgment). I shall refer to paragraphs 2 and 5 of the Charge as Charges 2 and/or 5.

4 In separate proceedings on sentence his Honour on 21 April 2009 sentenced the appellant to a fixed term of six months imprisonment commencing on that date and ending on 20 October 2009: Australian Securities and Investments Commission v Matthews [2009] NSWSC 285 (the April judgment). The appellant appeals against his conviction for contempt and against the severity of his sentence. The appellant accepted that the appeal was by way of rehearing pursuant to s 75A(5) of the Supreme Court Act 1970. Accordingly, to the extent that it might be necessary, this Court has the power to draw inferences and make findings of fact especially where, as here, the evidence is not in contest: see s 75A(6)(b).

The orders of Santow J relevant to the charges of contempt found by the primary judge

5 On 4 October 2000 Santow J, by consent, made a number of declarations and orders of which the following are presently relevant:

“3. Declares that the [appellant] has breached section 781 of the Corporations Law by carrying on an investment advice business by publishing the Securities Reports and the Advice Reports in circumstances where the [appellant] was neither a ‘licensee’ nor an ‘exempt investment adviser’.

…

7. Declares that the [appellant] has breached section 780 of the Corporations Law by carrying on a securities business by publishing the Offer Documents in circumstances where the [appellant] did not hold a ‘dealers licence’ nor was an ‘exempt dealer’.

8. Orders that the [appellant] be permanently restrained from undertaking, either directly or indirectly, the business of:

(a) advising other persons about securities; and/or

(b) publishing securities reports,

except as otherwise permitted by the Corporations Law.

12. Orders that the [appellant] be permanently restrained from undertaking, either directly or indirectly, the business of dealing in securities except as otherwise permitted by the Corporations Law.”

The relevant provisions of the

Corporations Law

referred to in Declarations 3 and 7

6 Section 781 of the Corporations Law as at the date of the making by Santow J of Declaration 2 was in the following terms:

“781. A person must not:

unless the person is a licensee or an exempt investment advisor.”

7 The expression “investment advice business” was defined in s 9 of the Corporations Law as having the meaning given to it by s 77(1) which provided as follows:

“A reference to an investment advice business, in relation to a person, is a reference to:

(a) a business of advising other persons about securities; or

(b) a business in the course of which the person publishes securities reports.”

8 Section 780(1) as at the date of the making of Declaration 7 provided as follows:

“A person must not:

(a) carry on a securities business; or

(b) …

unless the person holds a dealer’s licence or is an exempt dealer.”

9 The expression “securities business” had, by force of s 9, the meaning given to it by s 93(1) which defined such a business as “a business of dealing in securities”.

10 The word “deal” was defined in s 9 in relation to securities to mean, relevantly,

“…make or offer to make, or induce or attempt to induce a person to make or to offer to make, an agreement:

(i) for or with respect to acquiring [or] subscribing for … securities; or

(ii) the purpose or purported purpose of which is to secure a profit or gain to a person who acquires … [or] subscribes for … the securities or to any of the parties to the agreement in relation to the securities.”

11 It is not difficult to discern from the foregoing that Order 8 was intended to be consequential upon Declaration 3 and that Order 12 was intended to be consequential upon Declaration 7. The primary judge was also of this view when he observed at [7] of the February judgment that, relevantly, Orders 8 and 12 employed terminology used in the earlier declarations and, at [8], that the Order 8 terminology was to be found, inter alia, in Declaration 3 and the Order 12 terminology was to be found, inter alia, in Declaration 7. His Honour also observed that the relevant declarations related the particular forms of conduct to which they referred to particular provisions of the Corporations Law as they stood when the declarations were made on 4 October 2000. I have set out those provisions above and shall return in more detail to the issue of the relationship between those provisions and Orders 8 and 12 later in these reasons.

The Amended Statement of Charge

12 Relevantly, the Charge was in the following terms:

“1. By order 8 (‘Order 8’) of the Orders made by the Honourable Justice Santow on 4 October 2000, the [appellant], Stephen Lewis Matthews, was permanently restrained from undertaking, either directly or indirectly, the business of

Corporations Law

Corporations Act

2. The [appellant], Stephen Lewis Matthews, is guilty of contempt of this Court in that, in breach of Order 8, on or about 13 June 2008, the [appellant] directly undertook the business of advising other persons about securities by posting a letter dated 13 June 2008 to approximately 1,650 persons, who were the trustees of self managed superannuation funds, through which the [appellant] recommended that the recipients acquire shares in a company presently trading on the Australian Stock Exchange which was ‘an Australian brand name in its industry’ and which had ‘high public recognition’ by or through:

Corporations Law

Corporations Act

3. …

Corporations Law

Corporations Act

shares in a company presently trading on the Australian Stock Exchange which was ‘an Australian brand name in its industry’ and which had ‘high public recognition’ by or through:

Corporations Law

Corporations Act

The appellant’s letter dated 13 June 2008 referred to in the Charge

13 It was common ground that the appellant sent by post approximately 1,650 identical letters each addressed to the trustee or trustees of a self-managed superannuation fund. The offending letter (the letter) was in the following terms:

“I am a management consultant to the investment industry with a focus on the corporate governance requirements of ASX listed entities. In this role I encounter numerous investment opportunities.

Recently one of my clients (a former senior manager in risk management for Westpac) alerted me to some work he had done for a private equity firm. It concerned the evaluation of risk management practices for an ASX listed company which last year acquired a complementary business. The business is generating high profits. It will benefit from any further tightening of the credit markets.

The subject company is an Australian brand name in its industry with high public recognition. It pays dividends and is presently trading on ASX at a multiple of 4Xtimes it’s [sic] after tax earnings guidance for 2008.

Whilst it’s true that the credit crisis has thrown up numerous opportunities I am yet to see one trading at these attractive prices. Accordingly I have maxed out my available resources to acquire as of today an interest in 400,000 shares in the subject company. I have available to me a margin loan facility which requires presently a minimum 10% equity to loan margin for shares in the subject company. I intend to exit my investment in this company once its share price is trading at 6Xtimes its earnings per share. For a $10,000 investment (the minimum) this scenario would imply an after tax franked dividend return to the investor of $12,000, plus return of capital/loan.*

I am keen to increase my interest in this company and I am wondering if your SMSF could be interested to partner with me as lender or share investor in a new company vehicle which would acquire additional shares in the target company.

I am

Yours faithfully

[Signature]

Stephen L Matthews

* assuming that interest rates remain unchanged and exit occurs within 3 months.”

The alleged contempt

14 It was the contention of ASIC that by sending the letter to the superannuation fund trustees, the appellant contravened Orders 8 and 12. In the case of Order 8, the appellant breached that Order in that he

“directly undertook the business of advising other persons about securities”

.

15 Each of Charges 2 and 5 then alleged that the appellant breached each of Orders 8 and 12 by posting the letter. The charges then set out assertions, based upon the contents of the letter which, if established, would constitute, in the case of Order 8, directly undertaking the business of advising other persons about securities and, in the case of Order 12, directly undertaking the business of dealing in securities. As I have noted, the primary judge found these charges to have been made out.

The principles adopted by the primary judge in the February judgment

16 His Honour relevantly commenced his discussion of the issues by stating (at [5]) that the applicable legal principles had been “usefully and succinctly stated” in the recent judgment of Finn J in Metcash Trading Ltd v Bunn (No 5) [2009] FCA 16 at [9] in the following terms:

First,

Australian Consolidated Press Ltd v Morgan

Australian Prudential Regulation Authority v Siminton (No 7)

Secondly,

Universal Music Australia Pty Ltd v Sharman Networks Ltd

Thirdly,

Microsoft Corporation v Marks (No 1)

Universal Music Australia Pty Ltd

Fourthly,

Louis Vuitton Malletier SA v Design Elegance Pty Ltd

Fifthly,

Witham v Holloway

The issues addressed by the primary judge in the February judgment

17 The issues then addressed by his Honour were the following:

(a) The correct approach to construing Orders 8 and 12;

(b) The construction of those orders;

(c) The effect of the concluding qualification of Orders 8 and 12 given the repeal of the Corporations Law on 15 July 2001 and its replacement by the Corporations Act 2001 (Cth);

(d) The content and analysis of the letter;

undertaking of a business

18 The primary judge’s findings with respect to these issues were as follows:

(a) Applying the decision of this Court in Athens v Randwick City Council [2005] NSWCA 317; (2005) 64 NSWLR 58 at [36], Orders 8 and 12 were to be construed in the manner to which I have referred at [11] above; that is, by construing the terminology of the orders in accordance with the provisions of (including the definitions in) the Corporations Law on which they were founded.

Corporations Law

undertaking, directly or indirectly

advising other persons about securities

publishing analyses or reports about securities

deal

Corporations Law

.

(c) The concluding qualification of Orders 8 and 12 was to be construed by substituting a reference to the Corporations Law for the Corporations Act so that conduct engaged in after 12 July 2001 which was caught by the prohibiting words of the orders (disregarding the concluding qualification) ceased to be so caught where that conduct was “ not prohibited by ” as distinct from being “ positively and expressly allowed by ” a provision of the Corporations Act .

(i) contained an analysis and a report about shares in the unnamed Australian Stock Exchange (ASX) listed company (the listed company);

(ii) advised the recipient about such shares;

new company vehicle

partner with

as lender or share investor in

causing the addressee to enter into some form of partnership or association of a consensual and contractual nature

acquiring

undertaking

business

undertaking

business

(ii) As the business had as one of its recognisable activities the publishing of analyses or reports about securities or the giving of advice about securities, it was a business prohibited by Order 8;

(iii) As a further recognisable activity of the business was attempting to induce persons to make agreements with respect to acquiring securities, it was also one prohibited by Order 12.

The issues raised on the appeal

19 The issues raised by the appellant’s Amended Grounds of Appeal generally challenged each of the above findings. Notwithstanding the width of those grounds, in essence the appellant submitted that the primary judge erred in the February judgment in the following particular respects:

(a) By failing to apply the criminal standard of proof beyond reasonable doubt to his finding on each “ element ” of each charge;

(b) By failing to find proven each “ element ” of each charge even where expressed disjunctively; four “ elements ” were said not to have been considered, let alone found to have been proven, by his Honour;

(c) By failing to apply to the word “ dealing ” in Charge 12 its ordinary and natural meaning rather than its extended meaning as defined in s 9 of the Corporations Law ; this submission was part of the broader submission that his Honour was in error in applying Corporations Law terminology (including definitions) to the same terminology used in the Orders;

(d) By substituting a reference to the Corporations Act for the repealed Corporations Law in the concluding qualification to Orders 8 and 12;

20 I propose to deal with the foregoing issues seriatim. In doing so I will detail the primary judge’s relevant finding, his reasons therefor, the appellant’s submissions on the issue and my determination of it.

The first issue – the failure by the primary judge to apply the criminal standard of proof to his findings with respect to the elements of each charge

21 At [2] of the February judgment, his Honour said:

“The only factual question is whether the [appellant] sent the 1,650 letters as alleged. He admits that he did so. That matter is according proved beyond reasonable doubt.”

22 The appellant submitted that it should be inferred from this statement that his Honour considered that the only element of the charges required to be proved beyond reasonable doubt was that the appellant was the person who posted the 1,650 letters. In support of that proposition the Court was referred to [66] and [72] of his Honour’s reasons which were in the following terms:

I am satisfied

…

It is determined

23 Further reference was made to [41] when, in considering the contents of the letter, his Honour said:

“Exactly how that extrapolation is produced by the described ‘scenario’ is neither explained nor, upon analysis, clear.”

24 The “scenario” to which his Honour referred was the statement in the letter that the appellant intended to exit his investment in the listed company once its share price was trading at six times its earnings per share which, in respect of a $10,000 investment, would imply an after tax franked dividend return to the investor of $12,000 plus return of capital/loan.

25 Be this as it may, his Honour, after the sentence complained of, said the following:

What is clear

26 Reliance was also placed upon [43] of his Honour’s reasons which was in the following terms:

The message is equivocal on that point

27 It was, of course, common ground that it was well established that all proceedings for contempt, whether for civil or criminal contempt, must realistically be seen as criminal in nature. Thus in Witham v Holloway [1995] HCA 3; (1995) 183 CLR 525 at 534 [19], Brennan, Deane, Toohey and Gaudron JJ, in their joint judgment, stated

“[t]he consequence [of there being no distinction between civil and criminal contempt] is that all charges of contempt must be proved beyond reasonable doubt.”

28 In my view there can be no doubt that his Honour was fully aware, as the fifth proposition referred to by Finn J in Metcash Trading which his Honour recorded at [5] of his reasons and I have reproduced at [16] above made clear, that the facts in issue in a contempt charge must be proved beyond reasonable doubt.

29 In my opinion his Honour’s reference at [2] of his reasons to the “only factual question” was a correct reference to the only question of primary fact which was, indeed, whether the appellant had posted the 1,650 letters as alleged. There were no other facts to be proved as ASIC’s case then essentially depended on what the letter conveyed to its recipients.

30 Thus the other elements of the charges were to be elicited from the contents of the letter. This involved the drawing of inferences from the primary fact, being the posting of the letter. When analysing the contents of the letter, his Honour employed language which, in my view, left no doubt in his mind as to what it conveyed. Paragraphs 51 and 52 of his Honour’s reasons illustrate my point:

It is, to my mind, clear

It is also clear

31 The mere fact that his Honour expressed his ultimate conclusion at [72] in words that did not expressly import the criminal standard of proof does not mean that his Honour was not satisfied to that standard when he held that Charges 2 and 5 had been made out and that the appellant was accordingly guilty of contempt of court.

32 There is nothing in any authority to which we were referred that requires a trial judge in a criminal matter, particularly when there is no jury, to constantly remind himself throughout his reasons that each finding must be proved beyond reasonable doubt where otherwise it is clear that the trial judge has expressly recognised, as the primary judge did in the present case, that he was required to be satisfied to the criminal standard of proof. When one reads the relevant parts of his Honour’s judgment in context, it cannot be said that he was applying the civil, rather than the criminal, standard of proof to the findings he made. I would therefore reject the appellant’s first ground of challenge.

The second issue – the failure of the primary judge to consider or find proven beyond reasonable doubt, the four “

elements

” of the charges

33 The appellant submitted that in order for him to be found in breach of Order 8 as alleged in Charge 2, it was incumbent upon ASIC to prove beyond reasonable doubt that the appellant:

(i) directly ;

(ii) undertook the business;

(iii) of advising other persons about securities;

(iv) by posting the letter;

(v) through which the appellant recommended that the recipients acquire shares in the listed company which was “ an Australian brand name in its industry ” which had “ high public recognition ” by or through;

(vi) lending monies to the appellant or a “ new company vehicle ” established or to be established by the appellant ; and/or

(vii) acquiring shareholders in a “ new company vehicle ” established by or to be established by the appellant ;

Corporations Law

Corporations Act

34 The appellant submitted that each of the elements I have emphasised in items (i), (vi) and (vii) in the preceding paragraph were neither considered nor found to be proven by the primary judge beyond reasonable doubt or at all.

35 With respect to Charge 5, the appellant submitted that it was incumbent upon ASIC in order to establish a breach of Order 12 to prove beyond reasonable doubt, that the appellant

(i) directly ;

(ii) undertook the business;

(iii) of dealing in securities;

(iv) by posting the letter;

(v) through which the appellant made or offered to make an agreement ; and

(vi) attempted to induce the recipients;

(vii) to make or to offer to make an agreement;

(viii) for or with respect to acquiring and/or subscribing for; and/or

(ix) for the purpose or purported purpose of which was to secure a profit or gain through acquiring and/or subscribing for shares in the listed company which was “ an Australian brand name in its industry ” and which had “ high public recognition ” by or through;

(x) lending moneys to the appellant ; or

(xi) a “ new company vehicle ” established or to be established by the appellant ; and/or

(xii) acquiring shareholders in a “ new company vehicle ” established by or to be established by the appellant ;

Corporations Law

Corporations Act

36 The appellant submitted that each of the elements that I have emphasised in items (i), (v), (x), (xi) and (xii) in the preceding paragraph had been neither considered nor found by the primary judge to have been proven beyond reasonable doubt or at all.

37 In support of the foregoing submissions, the appellant relied upon the well-accepted proposition to which I have already referred, that all charges of contempt and all facts in issue in such charges must be proved beyond reasonable doubt. It was thus submitted that each of the emphasised “elements” were facts in issue, that they formed part of the charge and, therefore, were required to be proved beyond reasonable doubt before the charge was made out.

38 As is pointed out in Arlidge, Eadie & Smith on Contempt, 3^rd Ed (2005) Sweet & Maxwell at paragraph 3-74, with regard to civil contempt, given that the liberty of the subject is at stake, although the courts have in certain respects insisted upon the greater safeguards normally associated with the criminal trial process, such as in relation to the standard of proof required to establish a charge of contempt, they have also been careful to resist the full assimilation of civil contempt into the framework of criminal safeguards: Arlidge op cit at 3-75. Thus, in Witham v Holloway at 534, their Honours (in their joint judgment), whilst reiterating that all charges of contempt must be proved beyond reasonable doubt, also observed:

“However, to say that proceedings for contempt are essentially criminal in nature is not to equate them with the trial of a criminal charge. There are clear procedural differences, the most obvious being that criminal charges ordinarily involve trial by jury, whereas charges of contempt do not.”

39 A similar view was expressed by Wall J in Re B (A Minor) (Contempt of Court: Affidavit Evidence) [1996] 1 WLR 627 where, at 639A, his Lordship observed:

“I respectfully agree … that the analogy with criminal proceedings can be taken too far and that in civil proceedings for contempt the Court will introduce those safeguards which are necessary for the protection of the alleged contemnors but will not import criminal procedure wholesale or indiscriminately.”

40 There is, however, a plethora of authority that supports the proposition that an allegation of contempt must be made

“in sufficient detail and particularity in order to enable the person alleged to be in contempt to have before him or her enough information to enable him or her to meet the charge.”

Carew-Reid & Ors v Carew Corporation Pty Ltd

41 In Carew-Reid (at [12]) Nicholson J observed that

“…an alleged contemnor should have clearly particularised in the document particularising the alleged contempt the case against him or her. There are two reasons for that. The first is so that such allegations may be promptly and accurately met and the second is … that such matters will not be lightly raised.”

42 The foregoing principles find their source in a number of decisions of the High Court. Thus in Coward v Stapleton [1953] HCA 48; (1953) 90 CLR 573 at 579–580 the Court, in a joint judgment, said:

“[I]t is a well-recognised principle of law that no person ought to be punished for contempt of court unless the specific charge against him be distinctly stated and an opportunity of answering it given to him.”

43 Again, in Doyle v The Commonwealth [1985] HCA 46; (1985) 156 CLR 510 at 516, the Court, in a joint judgment, observed:

“… a proceeding for committal may result in a very serious interference with the liberty of the subject – indefinite confinement. Safeguards similar to those appropriate in criminal proceedings therefore apply. Speaking generally, the notice of motion for committal must be served personally on the person sought to be committed, the charge must be distinctly stated in the notice of motion or other application and the person sought to be committed must be given a proper opportunity to answer the charge.”

44 The particularity required of a charge of contempt was also emphasised by Sir John Donaldson M.R. in Chiltern District Council v Keane [1985] 1 WLR 619 at 622 where his Lordship said:

“The notice of motion was personally served on Mr Keane, but it only stated the grounds of the application to commit in general terms. It recited the undertaking and the injunction, and then alleged that there had been a breach. This, on the authorities, is not sufficient. It has been said in many cases that what is required is that the person alleged to be in contempt shall know, with sufficient particularity to enable him to defend himself, what exactly he is said to have done or omitted to do which constitutes a contempt of court.”

45 The foregoing statement was cited with approval by Nicholls LJ in Harmsworth v Harmsworth [1987] 1 WLR 1676. In the same case, Woolf LJ made the following observation at 1686 which is pertinent to the present case:

“What is not required by the relevant rules is that the notice of the motion should be drafted as though it was an indictment in criminal proceedings. While a respondent is required to be given particulars of what is alleged to be the breach, the particulars do not need to be set out in the same way as separate counts have to be set out in an indictment, nor do they need to give the particulars that you would normally expect to be seen in a count in an indictment. Furthermore, in my view, rules of duplicity and other rules which are designed to ensure the fairness of a trial before a jury, do not apply to proceedings of a different nature which are brought in respect of an alleged contempt.”

46 The primary judge was himself well aware of these principles having observed in McDonnell v Novello [2006] NSWSC 1186 at [26] (omitting citations) that the

Harmsworth v Harmsworth

47 The foregoing statements of principle from the authorities were, generally speaking, made in the context of whether the statement of charge contained particulars of the alleged contempt sufficient to enable the contemnor to know exactly what he was said to have done or alleged to have done which constituted the contempt and thus would enable him to meet the charge.

48 None of the authorities referred to deal with the issue presented in the instant case which is whether each and every allegation cited in support of the charge must be made out before it can be found that the charge is established to the requisite standard of proof.

49 Although not answering the specific question posed in this case, the following observations of Wilcox J in Concrete Constructions Pty Ltd v Plumbers & Gas Fitters Employees Union (No 2) [1987] FCA 117; (1987) 15 FCR 64 at 73 [28] are worth recording:

“The second question is whether the statements of charge sufficiently specify the alleged breaches. I think that they do. In each case the charge sets out the relevant orders and then alleges, in positive terms, that the respondent did the enjoined act. In essence, the complaint is that, the respondent being told to refrain from particular conduct, the respondent in fact committed that conduct. This is a clear enough allegation. It is true that, without more, the respondent would not know whether it is the case of the applicant that it carried out some positive act amounting to breach, and if so what act, or whether it is said that there was a contravention by the failure of the respondent to take a positive step necessary to bring to an end the condition of maintaining the ban. But that is the function of particulars; and in each of these cases particulars were included in the charge. In relation to omissions it is difficult to do more than to say that no action was taken. But this is sufficient. The respondent then knows the case it has to meet and that it will be an answer to that part of the case to show, if it can, either that no positive action was, under the circumstances, required or that it did take the relevant step …

50 Some possible assistance may also be found in the recent decision of Tracey J of the Federal Court in Bovis Lend Lease v Construction Forestry Mining & Energy Union [2009] FCA 194; (2009) 254 ALR 306. The first charge preferred in that case provided:

“In breach of paragraph 2 of the Order, on 19 February 2009 and 20 February 2009 and continuing, the Respondent failed to remove vehicles within its control that interfered with or impeded access to the New Royal Children’s Hospital (RCH Site), situate at 52 Flemington Road, Parkville.”

51 Particulars then followed as to the registration numbers of the relevant vehicles and individuals involved. Tracey J observed (at [60]) with respect to its adequacy:

Concrete Constructions

52 The second charge was as follows:

“In breach of paragraph 1 of the Order, on 20, 21, 22 February 2009 and continuing, the CFMEU has maintained an obstruction or interference to the passage of any person, whether on foot or in a vehicle, proceeding into or from the New Royal Children’s Hospital situate at 52 Flemington Road, Parkville (RCH Site).”

“The [CFMEU] (whether by itself, their officers, servants, agents or howsoever otherwise) until the hearing and determination of this proceeding or further order, be restrained from doing any act or directing, advising or authorising, or doing or continuing any act to aid, abet, counsel, procure, encourage or induce any person to obstruct or interfere with the passage of any person, whether on foot or in a vehicle proceeding into or from the New Royal Children’s Hospital situate at 52 Flemington Road, Parkville.”

53 The second charge was again supported by particulars as to the vehicle registration numbers of four vehicles said to be in the control of the CFMEU and parked in a position so as to interfere with or impede access to the RCH Site and as to the the mode of obstruction, being the establishment of tents or the parking of vehicles. The CFMEU’s principal complaint in relation to the second charge, which was based on paragraph 1 of the relevant Order, was that it was not clear whether the charge was dealing with acts performed directly by the CFMEU, by their officers, servants or agents performing the prohibited acts, or whether it was dealing with acts of the CFMEU to procure, encourage or induce another person to obstruct or interfere. It was unclear, so it was contended, whether the charge was a charge of direct obstruction or indirect obstruction or both.

54 His Honour dealt with this submission in the following terms:

“[64] I have already held that the order was expressed with the necessary clarity. The second charge, in substance, alleges that the CFMEU had, acting as it must through servants or agents, performed acts which had been enjoined by the order. The allegation is, I consider, made with sufficient clarity. The particulars subjoined to the charge identified some of the vehicles which, it was said, were so parked as to interfere with and impede access to the site. Paragraph (b) of the particulars does not allege that, what is described as a “blockade or picket” was “an act”. Rather, the “act” identified in the paragraph was maintenance of the blockade or picket, utilising the cars and the tents. There was no need to provide further particulars as to who erected the obstacles, how long they were in place and how they caused obstruction or interference. These were matters for evidence.

[65] In my view, each statement of charge was, when the charge is read as a whole, sufficient to convey the gist or substance of the breaches of Marshall J’s orders which were alleged by the prosecutor.”

55 With respect to the second charge his Honour found (at [91]) that he was satisfied that

“each element of the second charge has been established beyond reasonable doubt, but only in respect of the incidents on 19 and 23 February 2009 when vehicles were prevented from entering the site.”

many vehicles which were registered to the CFMEU

56 However, of some relevance is the fact that even though the second charge alleged breaches on 20, 21 and 22 February 2009 “and continuing”, his Honour found the charge proven with respect only to incidents on 19 and 23 February. In other words, the charge alleging breach of the Court’s order was made out if on only one of the dates specified in the charge the CFMEU maintained an obstruction or interference to the RCH site and this was so notwithstanding that the charge alleged obstruction or interference on a number of other occasions.

57 Although not a contempt case, some guidance can also be gleaned from the decision of the High Court in Montgomery v Stewart [1967] HCA 11; (1967) 116 CLR 220. The case concerned a prosecution for breach of s 43 of the Companies Act 1938 (Vic) which made it an offence to issue a prospectus that contained any untrue statement or wilful non-disclosure. The particulars of the charge listed a number of statements claimed to be untrue. The appellant took exception to the information on the ground that it charged more than one offence. The submission was rejected.

58 At 223 Barwick CJ observed that the offence created by s 43 was the single act of authorising the issue of a prospectus which contained any untrue statement or wilful non-disclosure. The section contained an exculpatory provision where the person charged reasonably believed the statement to be true or immaterial.

59 The Chief Justice then said:

“…If there is any untrue statement or any wilful non-disclosure in the prospectus as to which the person authorising the issue cannot make good one or other of the exculpatory matters, there must be a conviction; that is to say, that, unless the defendant is able to establish, as to every statement which is proved to be untrue and every wilful non-disclosure which is made out, either immateriality or reasonable belief in truth or immateriality, as the case may be, the authority for the issue of the prospectus will be in breach of the statute.”

60 His Honour also rejected the argument that the making of each false statement and each wilful non-disclosure constituted a separate offence. There was only one offence which was established if either one or more of several alleged untrue statements or non-disclosures was proven. Accordingly, to exculpate himself, the defendant had to establish an exculpatory matter with respect to each wilful non-disclosure or statement established to be false. Failure to do so, even if only one of a number of particularised statements were found to be untrue, was sufficient for what was a single offence to be made out.

61 The Chief Justice concluded in these terms (at 224):

“It was also said in support of the suggested construction of the section that if more than one statement is particularised as being claimed to be untrue, a defendant who had successfully established either the truth or immateriality or his reasonable belief in the truth or immateriality of some of the statements, upon conviction as to another statement or other statements would have recorded against him a conviction which particularised all the statements which had been charged as being untrue. But in truth this is a result which will not eventuate if due attention is paid to the terms of the conviction when drawn up for purposes of record. The record of conviction should set out only the statements which were proved to have been untrue and in respect of which the defendant has been convicted. The same would apply in the case of a wilful non-disclosure.”

62 At 226 Taylor J observed:

“…Leaving those words aside for the moment it seems clear enough that the conduct proscribed is the authorising of the publication of a prospectus which contains ‘any untrue statement’ and that the offence created by the section will be committed by a person who authorises the publication of a prospectus which contains either one or a number of false statements. …”

63 One of the issues debated in the Court of Criminal Appeal in Hannes v Director of Public Prosecutions (Cth) (No 2) [2006] NSWCCA 373; (2006) 165 A Crim R 151 was whether the subject indictment was bad for uncertainty or duplicity. At [9] Basten JA (who dissented in the result) referred to Montgomery v Stewart as involving

“the issue of a company prospectus containing a number of untrue or misleading statements. Each such statement would have been sufficient to give rise to the offence, the prohibited act being the issue of the prospectus. There was only one offence committed by issuing the prospectus, whether there were two or more untrue or misleading statements contained in it. Accordingly, an information alleging several such statements was not bad for duplicity”.

64 Montgomery v Stewart was recently referred to by the Full Court of the Supreme Court of South Australia in Diemould Tooling Services Pty Ltd v Oaten; Santos Ltd v Marcos [2008] SASC 197; (2008) 101 SASR 339. That case related to an alleged breach of s 19(1) of the Occupational Health Safety and Welfare Act 1986 (SA) which obligated an employer to ensure that its employee was, while at work, safe from injury and risks to health. It was alleged that the section was contravened in multiple respects.

65 Doyle CJ, with whom White J agreed, referred to Montgomery v Stewart and, in particular, to the passage from the judgment of Barwick CJ which I have recorded at [59] above. With respect to the case at hand the Chief Justice observed (at 349 [35])

Diemould

66 As I understand his Honour, where there is but one charge of contravention of a statutory provision and particulars are given that specify a number of acts or omissions, the establishment of any of which would give rise to that contravention, it matters not that all the acts or omissions particularised are not made good.

67 In my view the above analyses of Montgomery v Stewart are applicable to the present case. Although it is true that all elements of a charge of contempt must be made out, it does not follow that what are, in effect, particulars of the charge should be made out in their entirety, provided that those particulars which are established by the evidence are sufficient to constitute proof of the essential elements of the charge. However, in the present case the appellant submitted that Charge 2 comprised eight elements and Charge 5 comprised 13 elements, all of which were required to be proved beyond reasonable doubt before the respective charges could be established. In my opinion this submission should be rejected. The elements of those charges are only those which are necessary to establish breach of the relevant order.

68 With respect to Charge 2, the essential elements which required proof beyond reasonable doubt are those which I have identified as items (i), (ii), (iii) and (iv) at [33] above. Order 8, breach of which is the subject of Charge 2, relevantly enjoined the appellant from undertaking, either directly or indirectly, the business of advising other persons about securities. The four items to which I have referred were encapsulated in the allegation that in breach of that order the appellant directly undertook the business of advising other persons about securities by posting the letter to 1,650 persons who were the trustees of self-managed superannuation funds. What followed in Charge 2 and which for convenience I have numbered as items (v) to (vii) inclusive, did not constitute, in my view, elements of the charge but were particulars of the acts of the appellant which, if established, would justify a finding that he directly undertook the business of advising other persons about securities. They should be recognised as such and I shall hereafter refer to them as particulars accordingly.

69 In this respect, it is to be noted that of the complaints made by the appellant in the present context, only the allegation that he directly undertook the relevant business constituted an element of the charge whereas the complaints with respect to the emphasised parts of particulars (vi) and (vii) did not.

70 Furthermore, particular (vi) contained within it the alternatives of either lending monies to the appellant or to a new company established by or to be established by the appellant. In addition, particular (vi) is stated as an alternative to particular (vii). It was therefore sufficient if it was established that the letter recommended that the recipients acquire shares in the listed company either by lending moneys to the appellant or to the new company to be established by the appellant. It was thus sufficient, but not necessary, for ASIC to establish particular (vii).

71 The same observations can be made with respect to Charge 5. Order 12, to which that charge is related, enjoined the appellant from directly undertaking the business of dealing in securities. The charge was that in breach of that order he did precisely that. Its essential elements comprised items (i) to (iv) referred to at [35] above. Items (v) to (xii) were particulars. In a case such as the present where the relevant evidence was constituted by the contents of the letter, it was only necessary for ASIC to establish sufficient of those particulars as would constitute the direct undertaking of the business of dealing in securities.

72 It is convenient at this point to record the primary judge’s analysis of the contents of the letter so far as is relevant to the present issue:

…

49 The only thing that a recipient could do in response to the letter was to contact the [appellant] as envisaged by the last paragraph, that is, with a view to the possibility of lending money to, or investing in shares in, the ‘new company vehicle’ and by that means acquiring an indirect interest in such shares in the unnamed ASX listed company as the “new company vehicle” might in due course acquire.

…

51 It is, to my mind, clear that each letter contained an analysis and a report about shares in the unnamed ASX listed company. There was analysis to the extent of reference to the P/E ratio and attributes of the company’s business that might be expected to be reflected in profit performance and share price. There was a report about the matters that go to make up the analysis.

52 It is also clear that each letter advised the recipient about shares in the unnamed ASX listed company. It did so by stating, on the basis of the analysis and report, conclusions about the attractiveness of investment in those shares and suggesting that the recipient take a particular course with a view to obtaining, albeit indirectly, an interest in such shares.

53 Another feature of the letter is that it was calculated to convey an inducement ... The [appellant] attempted to induce the addressee to ‘partner with’ the [appellant] ‘as lender or share investor in a new company vehicle which would acquire additional shares in the target company’. The attempt was thus aimed at causing the addressee to enter into some form of partnership or association of a consensual and contractual nature, based on the ‘new company vehicle’ structure, the object of which was to acquire shares in the unnamed ASX listed company. The formation of the partnership or association would, obviously enough, involve the making of an agreement; and the agreement would be one “with respect to” “acquiring” shares in the ASX listed company. I say this because the envisaged agreement was one under which the [appellant] and the person solicited would cooperate in forming and funding the ‘new company vehicle’ for the specific purpose of its acquiring for their financial benefit shares in the ASX listed company.

54 The attempted inducement operated at a second level as well. The attempt was also aimed at causing the addressee to enter into a partnership or association agreement the object of which was the acquisition of either shares in or a repayment obligation of the ‘new corporate vehicle’. ...”

73 Common to Charges 2 and 5 was the submission that the primary judge made no finding that the letter proposed that the recipients would lend monies to the appellant. Further, to the extent to which the letter proposed the lending of monies to the new company, there was no finding that that company was to be established by the appellant. Reliance was placed upon his Honour’s findings at [49] that the only thing that a recipient of the letter could do in response thereto was to contact the appellant with a view to the possibility of lending money to the new company. There was no finding as to the possibility of lending money to the appellant personally.

74 Again, in the last sentence of [53] his Honour spoke of funding the new company and at [42] he postulated interested persons specifically becoming “a lender or share investor in a new company vehicle”. The appellant’s submission is, therefore, technically correct, but in my view is of no consequence. It was not suggested that provided the appellant was undertaking a business by posting the letter, his Honour’s finding that the letter advised its recipients to lend money to the new company for the purpose of acquiring shares in the listed company, did not constitute advice to those recipients about securities.

75 The appellant next submitted that his Honour did not find that the new company was to be established by the appellant. Any such company could, so it was contended, be established by the manager of the self-managed superannuation fund who took up the invitation contained in the letter. However, in my view it is clear from [53] of his Honour’s reasons, and particularly the last sentence, that he found that the letter envisaged that not only the persons solicited but also the appellant would “co-operate in forming … the new company”. The particulars in respect of which complaint is made do not assert that the new company was to be established by the appellant alone or otherwise than in conjunction with the persons solicited.

76 In any event, one would have thought that it was obvious that the letter conveyed that the establishment of the new company would either be at the instigation or with the direct involvement of the appellant who, as the letter stated, was to be a partner with the lender or share investor in the new company for the purpose of acquiring additional shares in the listed company. As s 75A applies to the hearing of the appeal, it is open to this Court to make the necessary finding of fact and it should. Accordingly, the appellant’s contention that the letter did not establish the relevant particular of which complaint is made should be rejected.

77 The appellant then directed his attention to particular (vii) in Charge 2 and particular (xii) in Charge 5 which referred to “acquiring shareholders” in a “new company vehicle”. He submitted that his Honour did not deal at all with the expression “acquiring shareholders”. In my view there is no textual uncertainty in what was being asserted, namely, to acquiring shares in the new company. The reference to “shareholders” was obviously a typographical error. The appellant’s submission has no merit.

78 Subject to the appellant’s submissions with respect to the word “directly” which was common to both charges and which it is convenient to address under Issue 5, the appellant then directed his submissions to so much of Charge 5 as alleged that

“the [appellant] made or offered to make an agreement and attempted to induce the recipients to make or to offer to make, an agreement”,

or

and

79 In my view there is no reason why particular (v) should be read other than disjunctively with particular (vi) notwithstanding the use of the conjunctive “and”. Under the definition of “deal” in s 9 of the Corporations Law, to which those particulars are clearly directed, making or offering to make an agreement is stated in the alternative to attempting to induce a person to make or to offer to make an agreement.

80 In any event the primary judge found that the letter in effect conveyed to the recipient at least an offer to make an agreement with respect to acquiring shares in the listed company through the new company. Thus at [53] of his reasons, the primary judge stated, and I repeat:

“the attempt [in the letter] was thus aimed at causing the addressee to enter into some form of partnership or association of a consensual and contractual nature, based on the ‘new company vehicle’ structure, the object of which was to acquire shares in the unnamed ASX listed company. The formation of the partnership or association would, obviously enough, involve the making of an agreement; and the agreement would be one ‘with respect to’ … ‘acquiring’ shares in the ASX ‘listed company’.”

81 Accordingly, although the letter did not itself constitute the making of an agreement, it did constitute an offer to make an agreement, and his Honour so found. In my opinion his Honour’s findings, to which I have referred, are more than adequate to support the elements of the charge.

82 In my opinion, therefore, with one minor exception, the appellant’s submission that the primary judge neither considered nor made any finding with respect to the four particulars of which complaint is made, should be rejected on two grounds. First, other than for the minor exception to which I have referred, his Honour did find that the letter conveyed the assertions contained in the challenged particulars and, second, that even if he did not, a finding with respect to those particulars was not necessary, given his Honour’s other findings, to support the establishment of each of the essential elements of each charge.

The third and fourth issues – the primary judge erred in (a) substituting a reference to the repealed

Corporations Law

for the

Corporations Act

2001 in the concluding qualification to Orders 8 and 12; and (b) in applying the definition of “

deal

” in s 9 of the

Corporations Law

to the word “

dealing

” in Charge 5

83 The primary judge dealt with this issue at [25] to [35] of the February judgment. At [25] he noted that the Corporations Law had been repealed and superseded by the Corporations Act 2001 (Cth) on 15 July 2001. At [26] he noted that ASIC had approached the matter on the footing that if conduct engaged in since 15 July 2001 was within the prohibiting words of one of the orders but was “permitted by” the Corporations Act as in force at the time that conduct was engaged in, then there was no contravention of the order. Significantly, at [27], his Honour noted that the appellant accepted that approach to the effect and construction of the concluding qualification in the relevant orders.

84 Notwithstanding the concessions of trial counsel for the appellant referred to in the preceding paragraph, which also accepted that Orders 8 and 12 were made in the context of the Corporations Law and that to the extent that the orders used expressions found in the statute, there was an intention to adopt the statutory definitions of those expressions, the appellant in this Court nevertheless challenged his Honour’s approach in this regard in two respects. The first related to the meaning of the word “dealing” in Order 12. The second challenged his Honour’s finding that the reference in the concluding qualification of Orders 8 and 12 to the Corporations Law should be read as a reference to the Corporations Act.

85 The effect of the common approach of the parties referred to by his Honour was stated by him as follows:

Corporations Act

29 I say this because it seems to me that the words ‘permitted by’ must, in the context, mean ‘not prohibited by’, as distinct from ‘positively and expressly allowed by’.

30 ASIC, on my understanding, accepts this construction; and I do not understand it to be disputed by the [appellant].”

86 The appellant then submitted that as the Corporations Law was repealed as and from 15 July 2001, it followed that, given the primary judge’s approach to the concluding qualification at [28] of the February judgment, neither Orders 8 nor 12 prohibited anything.

87 The flaw in this submission, notwithstanding the concession made before the primary judge by the appellant that the reference in the concluding qualification to Orders 8 and 12 to the Corporations Law should be read as a reference to the Corporations Act, is the failure to acknowledge the effect of the provisions of s 1384B(1) of the Corporations Act which provides as follows:

“(1) For the avoidance of doubt, if:

(a) a proceeding was started in a court before the commencement; and

(b) the proceeding was a federal corporations proceeding that related to a matter to which a provision of the old corporations legislation of a State or Territory in this jurisdiction applied; and

(c) a decision was made or an order given in the proceeding before the commencement;

the decision or order continues to have effect after the commencement despite the provision of the old corporations legislation ceasing to have effect.”

88 The expression “federal corporations proceeding” is defined in s 1382(1) as meaning a proceeding of one of the following kinds, namely and relevantly:

“(bb) a proceeding in relation to a matter to which a provision of the old corporations legislation of a State or Territory in this jurisdiction applied:

(i) in which the Commonwealth was seeking an injunction or a declaration; or

(ii) to which the Commonwealth, or a person suing or being sued on behalf of the Commonwealth, was a party;

(bc) any other proceeding in relation to a matter to which a provision of the old corporations legislation of a State in this jurisdiction applied that was in the exercise of federal jurisdiction.”

89 The word “court” in s 1384B(1)(a) is defined by s 9 of the Corporations Act as having the meaning given to it by s 58AA which relevantly includes the Supreme Court of New South Wales: see s 58AA(1)(b). The declarations and orders made by Santow J were made in a proceeding which was started before the commencement of the Corporations Act and was a “federal corporations proceeding” within the meaning of s 1384B(1)(b) as defined in s 1382(1) as falling within sub-paragraph (bb) or (bc) of the definition of that expression. Further, the Supreme Court was exercising federal jurisdiction in any such proceedings: Australian Securities and Investments Commission v Edensor Nominees Pty Ltd [2001] HCA 1; (2001) 204 CLR 559 at 563 [7]; Meteyard v Love [2005] NSWCA 444; (2005) 65 NSWLR 36 at 44 [30].

90 It follows from the foregoing that notwithstanding the repeal of the Corporations Law, Orders 8 and 12 continued to have effect after 15 July 2001. However, the appellant submitted that although that was so in the sense that the orders remained in force, nevertheless they had no relevant effect in that they still had no work to do. In other words, the orders remained valid but in light of the agreed approach to the concluding qualification referred to by the primary judge at [28] of the February judgment, the prohibition otherwise contained within Orders 8 and 12 (disregarding the concluding qualification) ceased to have that effect once the Corporations Law was repealed. Thereafter, given the approach of the primary judge at [29] of his reasons, any conduct which would otherwise be in breach of the orders would be “not prohibited by” a statute which no longer existed.

91 In my view these submissions should be rejected for the following reasons. First, the object of s 1384B(1) was that Orders 8 and 12 continued “to have effect” according to their terms. This means that the prohibition contained in the orders remained effective so that it became irrelevant that the enjoined conduct was “not prohibited by” a statute that no longer existed. In other words, on the appellant’s own construction of the concluding qualification, the effect of the repeal of the Corporations Law is that the qualification has no further work to do after that repeal.

92 Second, I do not, with respect, agree with his Honour’s construction of the concluding qualification insofar as he construed the words “permitted by” as meaning “not prohibited by” as distinct from “positively and expressly allowed by”. Although that construction was one adopted by ASIC, this was on the agreed basis that the reference in the concluding qualification to the Corporations Law should be read as a reference to the Corporations Act. In my view the concluding qualification “except as otherwise permitted by the Corporations Law” has the meaning rejected by the primary judge, namely, except as expressly permitted or allowed by that statute. If this be so, then the repeal of the Corporations Law, even accepting that the Corporations Act was not substituted therefor, does not render ineffective the prohibiting words of Orders 8 and 12. For the foregoing reasons, the appellant’s submission with respect to the true construction of the concluding qualification to Orders 8 and 12 should be rejected.

93 As I have already noted, the foregoing submission of the appellant was part of a more general contention that his Honour was in error in applying Corporations Law terminology (including relevant definitions) to the same terminology used in Orders 8 and 12. The issue so raised concerned the primary judge’s approach to the construction of those orders. I have already referred at [11] above to [7] and [8] of the February judgment in which his Honour, in my view correctly, observed that Orders 8 and 12, in effect, reflected the terminology, relevantly, of Declarations 3 and 7. He then concluded:

Corporations Law

94 After referring (at [11]) to Order 8 being relevantly expressed in terms clearly traceable to s 77(1)(a) (“a business of advising other persons about securities”) and s 77(1)(b) (“a business in the course of which the person publishes security reports”) of the Corporations Law, his Honour noted that these descriptions constituted the definition of the expression “investment advice business” which was relevant to s 781(a) on which Order 8 was based. He then referred to the definition in s 9 of the term “securities report” and the definition of “securities” in s 92, concluding at [12] that when

“read in the light of the obviously envisaged statutory provisions, Order 8 enjoined the ‘undertaking, directly or indirectly’ of a business of ‘advising other persons about securities’ (as defined by s 92) or of ‘publishing analyses or reports about securities’ (as defined by s 92) or of engaging in both those activities”.

95 At [20] his Honour found that Order 12, which restrained the appellant from “undertaking … the business of dealing in securities”, was based on a combination of ss 780(1) and 93(1) of the Corporations Law and the s 9 definition of “deal” as it existed as at 4 October 2000. Section 93(1) provided that a “securities business” was a “business of dealing in securities”. His Honour then set out the s 9 definition of “deal” as it related to securities and to which I have relevantly referred at [10] above.

96 Accordingly, at [23] the primary judge determined that Order 12 must be approached on the basis that it prohibited conduct of the kind that s 780(1) of the Corporations Law prohibited on 4 October 2000.

97 It was submitted that had it been intended that the word “dealing” in Order 12 should incorporate the definition of “deal” as it related to securities in s 9 of the Corporations Law, then the terms of the order should have and would have made that clear. It was submitted that the word should be given its ordinary meaning, being the buying and selling of securities, and not its extended statutory meaning.

98 His Honour’s approach to the construction of the orders was, as he noted at [10], consistent with that taken by this Court in Athens v Randwick City Council [2005] NSWCA 317; (2005) 64 NSWLR 58, where it was held (at 71 [36]) by Hodgson JA, with whom Santow JA and myself relevantly agreed, that

“[i]n considering whether an order is expressed so that the recipient knows or plainly should know what is required, it may be appropriate to have regard to the circumstances in which the order is made, including the terms of the reasons given for the order and elements of applicable law”.

99 In so holding, the Court applied the principles adumbrated by Campbell J, as his Honour then was, in Kirkpatrick v Kotis [2004] NSWSC 1265; (2004) 62 NSWLR 567 at 578 [55] and, relevantly to the present case, at 579 [57] where his Honour said:

“In the case of consent orders, where surrounding circumstances can be used as an aid to construction, those surrounding circumstances can have the effect that an order which is ambiguous, considered in isolation, is found to be not ambiguous when read in light of the surrounding circumstances. As the surrounding circumstances that are taken into account are facts known to all parties to the consent order, they are the very thing that a person trying to understand and obey the order would take into account. Hence it is appropriate that any question of whether the order is ambiguous should be answered only after such facts have been taken into account.”

100 In the present case, apart from the fact that the orders made by Santow J were consent orders, there was no evidence before the primary judge as to the circumstances pursuant to which those orders were made. However, in my view it is sufficient to read the declarations and orders made by Santow J as a whole to appreciate that his Honour’s orders were made in the context of the preceding declarations. The primary judge approached the construction of the orders in this manner and in my view he was correct in so doing. The appellant’s submission that Order 12 should be construed as if the expression “the business of dealing in securities” was divorced from the expression “securities business” in s 780(1)(a) which is defined in s 93(1) as the business “of dealing in securities” cannot be sustained. Accordingly, the appellant’s challenge to his Honour’s construction of Order 12 and his adoption of the extended statutory meaning of the word “deal” should be rejected.

The fifth issue – the primary judge erred in finding that by posting the letter the appellant was undertaking a business

101 At [59] of the February judgment the primary judge noted the appellant’s submission that his action in posting the letter, albeit to 1,650 persons at 1,650 separate addresses, did not entail his “undertaking” of any “business” which was central to both Orders 8 and 12. His Honour accepted at [60] that immediately before he posted the letters, the appellant was not engaged in any business involving activities of the kind he proposed for the consideration of the persons to whom the letters were addressed.

102 After referring to the statement of Latham CJ in Western Gold Mines NL v Commissioner of Taxation (WA) [1938] HCA 5; (1938) 59 CLR 729 at 733 that “every business must begin with a single transaction”, his Honour continued:

Hyde v Sullivan

‘Speaking generally, the phrase ‘to carry on business’ means to conduct some form of commercial enterprise, systematically and regularly, with a view to profit, and implicit in this idea are the features of continuity and system.’

62 The [appellant’s] action in despatching the 1,650 letters thus entailed his ‘undertaking’ a ‘business’. The question is whether the business was of a kind comprehended by Order 8 or Order 12.”

103 His Honour then went on to deal with the question of whether the business was of a kind contemplated by Orders 8 or 12. His conclusion at [66] and [67] of his reasons that it was is not the subject of challenge.

139 It was submitted that in view of the principle recognised by the primary judge at [48] that a court must not sentence an offender to imprisonment unless it is satisfied, having considered all possible alternatives, that no penalty other than imprisonment is appropriate, his Honour erred in rejecting a suspended sentence as appropriate on the basis that that had been tried but failed to deter the appellant in further contravening the subject orders.

140 Reference was made to the two year suspended sentence imposed upon the appellant by Foster AJ on 30 August 2001, which deterrent had lasted some seven years. The basis upon which Foster AJ had so sentenced the appellant was stated by him in the following terms:

“50. Mr Matthews has already served the previous sentence of three months imprisonment. Clearly, a further custodial sentence would be appropriate. However, I feel some disquiet at the prospect of sending Mr Matthews to prison again, particularly as the previous sentence does not appear to have effected a change in his behaviour. Indeed, he rather gave me the impression of embracing martyrdom. I am concerned that the imposition of a necessarily greater custodial sentence might well be equally ineffective in curbing his seemingly perverse desire to publish in breach of the Court’s orders. Although such punishment would be well merited, it might serve only to feed his intransigence, leading to further breaches, charges of contempt and costly and time consuming Court proceedings. This result would not, in my view, be ultimately in the public interest. …

51. In my opinion I should seek, in the public interest, to find, in the present case, the most effective remedy. Although Mr Matthews did not respond sensibly to the suspended sentence imposed earlier by Sackville J, it must be recognised that the sentence was, then, a relatively short one. I have formed the view that Mr Matthews is more likely to curb his fool-hardy attitude to the Court’s orders, if he is under the threat of a substantial suspended sentence, to be served should he offend again. I consider the appropriate sentence to be one of twelve months imprisonment in respect of these offences. … “

141 It was submitted that the fact that his Honour suspended the sentence in that case had had the effect of curbing the appellant’s “seemingly perverse desire to publish in breach of the Court’s orders” and that this had had a lasting effect of some seven years. The primary judge recognised this but noted, in my view accurately, that that deterrence had not “been of lasting effect”. It follows, in my view, that no error has been demonstrated with respect to the weight given by the primary judge to the fact that the appellant had not contravened the subject orders between 2001 and 2008. It was entirely a matter for the primary judge to weigh up the various alternative forms of punishment in the circumstances and this he clearly did, finding (at [52]) that neither a community service order nor a suspended sentence would have the deterrent effect or convey the message of denunciation which was required in view of the appellant’s history of offending.

142 Finally, the appellant submitted that the primary judge gave no weight to the circumstance that there was no victim of his contempt in that the appellant did not enter into any transaction with any person who responded to the letter. His Honour did, however, note at [17] that there had been some responses to the letters and that in fact one person had arranged to meet the appellant on 26 June 2008 but had cancelled. His Honour recognised that in the result the appellant did not transact or deal with anyone as a result of the letters. In my view, having recognised that fact, his Honour gave it as much weight as it deserved which, in my view, was minimal.

143 The appellant did not contend that, if he failed on his particular challenges to the primary judge’s reasoning with respect to the sentencing of the appellant, nevertheless the sentence of six months imprisonment was manifestly excessive. In the circumstances it clearly was not. If anything it was lenient.

144 For the foregoing reasons I am of the opinion that the appellant’s challenges to the sentence of six months imprisonment imposed upon him by the primary judge should be rejected and the sentence confirmed. His appeal against sentence should therefore be dismissed.

The appellant makes a bail application

145 It would appear that shortly before the appeal was to be heard, the appellant made an application to Latham J in the Common Law Division of the Supreme Court for bail pending the hearing of his appeal. It would also appear that her Honour considered that she had jurisdiction to grant bail by virtue of the provisions of s 64 of the Bail Act 1978. However, she apparently declined to exercise her jurisdiction, considering it was more appropriate that any application for bail should be made to this Court in which the appellant’s appeal was then pending.

146 There was some debate in this Court as to its power to grant bail where there had been a sentence of imprisonment for contempt and reference was made to the decision of this Court in Young v The Registrar of the Court of Appeal (No 2) (1993) 71 A Crim R 121 at [125]–[126] per Kirby ACJ with whom Handley and Powell JJA agreed.

147 A difficulty arises because in the event that bail is granted and the appeal dismissed, there may be no power in the Court to re-sentence or recommence the sentence taking into account the period of bail. In other words, notwithstanding the grant of bail it appears that the sentence continues so that, if the appeal fails, the contemnor gains the benefit of his freedom on bail whilst the sentence of imprisonment continues uninterrupted by the period of bail: see Parker v Director of Public Prosecutions (1992) 28 NSWLR 282 at 298F referred to by Kirby ACJ in Young at 125.

148 It is unnecessary to solve those difficulties in the present case for the appellant applied to this Court at the end of the hearing of the appeal nunc pro tunc for bail pending the Court’s decision. This was refused on the basis that the Court’s reasons for the refusal would be included in its reasons on the substantive appeal.

149 The appellant accepted that if he were to be granted bail, it would be on the basis that the Court was of the view that he had arguable grounds for succeeding on his appeal. By the end of the argument on the appeal and at the time the application for bail was made, the Court had come to the view that the appeal would fail. In those circumstances no proper basis existed for the granting of bail and it was, as I have said, refused.

Conclusion

150 For the foregoing reasons, in my opinion the appellant’s appeal against both his conviction for contempt as well as his sentence should be dismissed with costs.

151 BASTEN JA: On 25 February 2009 Barrett J handed down judgment in the Equity Division concluding that Stephen Lewis Matthews (“the appellant”) was guilty of two counts of contempt of court, for contravening prohibitions imposed by earlier consent orders: see ASIC v Matthews [2009] NSWSC 77. In a second judgment delivered on 21 April 2009, his Honour committed the appellant to prison for a fixed term of six months commencing on 21 April 2009 and ending on 20 October 2009: ASIC v Matthews [2009] NSWSC 285.

152 The proceedings in the Equity Division were commenced by the Australian Securities and Investments Commission (“the Commission”) seeking various orders including Mr Matthews’ committal to prison. The appellant appeals against each of these judgments and the declarations and orders, pursuant to s 101(5) of the Supreme Court Act 1970 (NSW). Accordingly, the leave requirements in s 101(2) of the Supreme Court Act do not apply: see s 101(3).

153 I agree with Tobias JA that the appeal should be dismissed and, subject to the following comments, with his Honour’s reasons. These further comments are largely in amplification of particular points.

Charge of civil contempt

154 The charge being one of contravention of a court order, the contempt is characterised as civil: see Australasian Meat Industry Employees’ Union v Mudginberri Station Pty Ltd [1986] HCA 46; 161 CLR 98; Secretary of State for Home Department v Harman [1983] 1 AC 280 at 310 (Lord Scarman); Hearne v Street [2008] HCA 36; 235 CLR 125 at [130] and [141] (Hayne, Heydon and Crennan JJ); at [2] (Gleeson CJ agreeing) and at [24] (Kirby J agreeing). Although characterised as civil, some attributes of criminal proceedings are engaged, including the standard of proof beyond reasonable doubt: Witham v Holloway [1995] HCA 3; 183 CLR 525 at 534. Deliberate or contumelious defiance of a court order may constitute criminal contempt, but that was not alleged in the present case. The limitations on enforcement of judgments found in Part 8, Div 5 of the Civil Procedure Act 2005 (NSW) and the Uniform Civil Procedure Rules 2005 (NSW) do not limit or otherwise affect the power to commit for contempt: Civil Procedure Act, s 131.

155 The amended notice of appeal raised issues with respect to the finding of contempt and the order for committal: see above at [19]. In relation to liability, the issues, shortly stated, were as follows:

156 With respect to the first matter, the appellant relied upon the statement of the trial judge that the “only factual question” was whether the defendant had sent the letters as alleged, which he admitted doing and which was therefore proved beyond reasonable doubt: at [2]. This gave rise to two further questions, which underlay each of the grounds of appeal, namely:

157 A consequential question which arises if the appellant makes good his grounds, in part or in whole, is the course which should be taken by this Court on the appeal.

158 In this context, it may be noted that the second ground of appeal was formulated in terms of either failing to make findings or failing to give reasons. The latter limb can be disposed of summarily: there is no reason to suppose that his Honour made findings which he did not identify or explain in his judgment: cf Waterways Authority v Fitzgibbon [2005] HCA 57; 79 ALJR 1816 at [130] (Hayne J). Nevertheless, the question remains whether, if there were findings which were required but not made, what course this Court should take.

Nature of appeal

159 As already noted, the appeal is brought pursuant to s 101(5) of the Supreme Court Act. It is therefore an appeal in proceedings in the Court for the purposes of s 75A of the Supreme Court Act. None of the exclusions in s 75A(2) or (3) is engaged. The decision under appeal was given after a hearing and the nature of the appeal is therefore one “by way of rehearing”: s 75A(5). That being so, this Court has the same power as the trial judge to make findings of fact and draw inferences from the evidence: s 75A(6). No other statutory provision was relied upon to limit the jurisdiction of the Court, pursuant to s 75A(4). Subject to the inherent limitations on the power of a court which has not heard witnesses to make findings of fact on the basis of a transcript of evidence, the Court has power to make any finding and give any judgment which should have been made or given below: s 75A(10).

160 Apart from some brief and inconsequential cross-examination of a recipient of the letter who had spoken briefly to the appellant about the proposal, the case for the Commission was entirely documentary. The appellant gave evidence in his defence by way of affidavit, upon which he was cross-examined. Although the Court was taken to some passages in the cross-examination in the course of the appeal, it was not suggested that this Court was in any different position to that of the trial judge in assessing the evidence, so far as it was relevant. A significant element of the case presented to the trial judge was that either the appellant was seeking “employment” or that he had a defence based on an honest and reasonable belief that he was not in breach of the orders. Neither of these matters was pursued on appeal. Accordingly, this Court is in as good a position as the trial judge to make factual findings, if required.

Nature of pleadings in civil contempt

161 While civil contempt is not a criminal proceeding, it may result in confinement of the individual, with the result that “[s]afeguards similar to those appropriate in criminal proceedings therefore apply”: Doyle v The Commonwealth [1985] HCA 46; 156 CLR 510 at 516 (Gibbs CJ, Mason, Wilson, Brennan and Dawson JJ). Their Honours continued by adopting the following passage from the joint judgment in Coward v Stapleton [1953] HCA 48; 90 CLR 573 at 579-580 (Williams ACJ, Kitto and Taylor JJ)

“…it is a well-recognized principle of law that no person ought to be punished for contempt of court unless the specific charge against him be distinctly stated and an opportunity of answering it given to him …. The gist of the accusation must be made clear to the person charged, though it is not always necessary to formulate the charge in a series of specific allegations …. Resting as it does upon accepted notions of elementary justice, this principle must be rigorously insisted upon."

162 The issue in Doyle was not a question of pleading, but concerned the power to commit for contempt after an ex parte proceeding.

163 The requirements for pleading on a motion for civil contempt are to be found in the Supreme Court Rules 1970 (NSW), Pt 55, Div 3. Rule 7 requires a statement of charge, being “a statement specifying the contempt of which the contemnor is alleged to be guilty”.

164 Lack of detail in the rules is not a basis for denying a defendant the right to know the precise conduct alleged against him or her. As explained by Woolf LJ in Harmsworth v Harmsworth [1987] 1 WLR 1676 at 1686C, “a person alleged to have been guilty of contempt is required to be given particulars sufficient to let him know the subject matter of the breach which is alleged”. His Lordship continued:

165 Similar principles have been adopted in this country. Thus, in Concrete Constructions Pty Ltd v Plumbers and Gasfitters Employees’ Union (No 2) (1987) 15 FCR 64 at 74, Wilcox J stated:

Lazar v Taito (Australia) Pty Ltd

‘The fact is, however, that what is charged is contempt of court in not complying with the relevant injunctions. The charges operate to indicate the injunction (or injunctions) relied upon, and to give brief particulars. The analogy between the charge required by the rules of court and a criminal charge is incomplete, because the person to whom an injunction is directed knows, with some precision, and specificity, what he is commanded not to do.’”

166 Further statements to similar effect may be found in numerous cases, a number of which were summarised in Inghams Enterprises Pty Ltd v Timania Pty Ltd [2005] FCAFC 155 at [32] (Tamberlin, North and Dowsett JJ).

167 While the principle that an indictment must deal with one offence and only one offence may not apply, there are other principles of criminal pleading which may be relevant by analogy. Pleadings can involve what is sometimes described as “latent duplicity” which may give rise to uncertainty as to the charge to be met, and which should be corrected if the defendant is to have a fair trial: see S v The Queen [1989] HCA 66; 168 CLR 266 at 274 (Dawson J) and 280-281 (Toohey J), and other authorities discussed in Hannes v Director of Public Prosecutions (Cth) (No 2) [2006] NSWCCA 373; 60 ACSR 1; 165 A Crim R 151 at [4]-[15].

168 A statutory prohibition may encompass a range of conduct or conduct which may be characterised in more than one way, or both. Even in relation to a civil contempt, there are risks in pleading alternative bases for a charge and particularly where ambiguity is deliberately created by the use of “and/or”. It may be important to consider the form of pleading where only one act or course of conduct is alleged, but where that act or course of conduct requires characterisation as to its purpose or effect, in order to constitute a contravention of a prohibition. An example may be found in Montgomery v Stewart [1967] HCA 11; 116 CLR 220 which involved the issue of a single prospectus, which was alleged to contain more than one untrue statement. The offence was committed if the prosecution established any one statement to be untrue and material, but the seriousness of the offence and the form of the conviction would clearly have been affected by a finding that a number of statements, or a finding that only one statement, was untrue: see discussion at 224 (Barwick CJ).

169 In the present case, each of the charges involved a cascade of particularity. Thus, there was no uncertainty that the appellant was charged with a breach of a specified order of the Court, which occurred on or about 13 June 2008, by posting a letter of that date to 1,650 persons. Paragraph 2 (the second charge) alleged that such conduct involved directly undertaking the business of advising other persons about securities. In this form, paragraphs 2 and 3 dealt separately with the two limbs of order 8. Further, each charge identified the means by which the business was undertaken as being “direct” rather than “indirect”.

170 No complaint could have been taken (or was taken) in respect of these matters. Indeed, no complaint was taken about the form of any of the charges, or, more particularly, those contained in paragraphs 2 and 5 of the statement, which were upheld.

Elements of charges

171 To establish the second charge, the Commission needed to establish beyond reasonable doubt that:

172 It was sufficient for the Commission to make out these elements: whether the sending of the letter could be so characterised, depended, at least in part, on the content of the letter. The proposed characterisation of the letter was further identified as recommending that the recipients acquire shares in a company – by or through, taking one of two courses. The first was to lend moneys to the defendant or a corporate vehicle; the second was to acquire “shareholders” in a corporate vehicle. The term “by or through” is to be read disjunctively so that acquisition is either by lending moneys or through acquiring a shareholding. In relation to the first option, the moneys may be lent to the appellant, or to a new company. The new company may be established by the defendant or may be a company the defendant would establish in the future. The second option was to acquire shares in a company which, again, was either established by or to be established by the defendant.

173 All of this material was by way of particularising the third element to be established by the Commission, namely the characterisation of the business as that of advising others about securities. The key step to that end was to establish that the appellant was recommending the acquisition of shares in a publicly listed company. However, the mechanism of acquisition was intended to be indirect, so as to involve the appellant. There were, in effect, three separate mechanisms identified, namely:

(a) lending money to the defendant;
(b) lending money to a new company, or
(c) acquiring shares in a new company.

Whether the new company had been established as at 13 June 2008, or whenever the recipient of the letter acted upon it, was not a key issue; the key element was that the new company would be established by the defendant.

Standard of proof

174 Of the elements set out at [171] above, it is clear that his Honour was satisfied as to the first element, beyond reasonable doubt.

175 With respect to the second element, his Honour’s reasoning involved two steps: the first was to identify as a matter of law what was required to undertake a business. There was no evidence that the appellant had effected a transaction with any recipient of a letter. The legal question was whether the despatch of the letters was capable of constituting the undertaking of a business. His Honour held that it was and, for the reasons identified by Tobias JA, no error has been demonstrated in that respect. He identified the question in the following terms at [61]:

“… a person who attempts, through widespread solicitation, to interest persons in entering into commercial transactions with the person, who is willing to treat and, if possible, transact with such, if any, of the solicited persons as express interest, who approaches the solicitation in a methodical and systematic fashion and who acts in that way with a view to financial gain must be regarded as thereby ‘undertaking’ a course of activity amounting to ‘business’ ….”

176 As may be seen, there are a number of factual inferences to be drawn in order to satisfy that test. The elements were not addressed specifically in the context of the discussion at [61]. However, the analysis of the content of the letter had already been undertaken by his Honour, together with the surrounding circumstances so far as relevant and as had been described by the appellant in his evidence. On some points, his Honour considered the letter equivocal. For example, it was unclear from the letter whether a new company had in fact been formed: at [43]. His Honour accepted that it had not: at [46]. To the extent that the formation of such a company or companies might have given weight to the view that the appellant was undertaking a business, that support was not available. But it is also clear that his Honour did not rely upon any such support. In other respects he identified the purpose and effect of the letter in terms which did not admit of doubt. The suggestion that such elements were identified on some lesser standard of proof should be rejected.

177 The same conclusion should be reached in respect of the third element, namely the nature of the business. His Honour stated at [52]:

“It is also clear that each letter advised the recipient about shares in the unnamed ASX listed company. It did so by stating, on the basis of the analysis and report, conclusions about the attractiveness of investment in those shares and suggesting that the recipient take a particular course with a view to obtaining, albeit indirectly, an interest in such shares.”

178 This conclusion demonstrated that each of the three elements was satisfied, in accordance with the particulars provided and on a basis that did not admit of reasonable doubt. The principles discussed above apply equally to the second charge.

179 The challenges raised by grounds 1 and 2 in the amended notice of appeal should be rejected for these reasons, in addition to those given by Tobias JA.

180 I also agree with the reasons given by Tobias JA for rejecting the challenges raised in grounds 3 and 4. Accordingly, the findings that charges 2 and 5 had been made out, beyond reasonable doubt, should stand.

181 With respect to the challenge to the “sentence” or order of committal, I agree with Tobias JA that no basis for interference has been established. Punishment by committal to a correctional centre is expressly recognised by Pt 55, r 13(1) of the Supreme Court Rules. Both the decision to commit and the period for which the appellant was committed are matters involving the exercise of a discretionary power, of a kind closely analogous to the imposition of a penalty for a criminal offence. The principles set out in House v The King [1936] HCA 40; 55 CLR 499 apply. No relevant error was demonstrated.

Bail application

182 As noted by Tobias JA, counsel for Mr Matthews made a bail application at the completion of the hearing of the appeal. On one view, that application was somewhat opportunistic. A similar application had been made to a judge in the Common Law Division, Latham J, and had apparently been refused. Neither the basis of the application nor the reason for refusal was before this Court. Further, a bail application had been foreshadowed at a directions hearing in this Court but the appellant had been granted an early hearing of his appeal, in which circumstance it appears that the bail application was not pursued. A relevant factor in rejecting the application made at the hearing of the appeal was that it was then anticipated that judgment would be delivered within two weeks.

183 At the time the application was made, it was my tentative view that the appeal should be dismissed and that, given the period during which judgment was likely to be reserved, the bail application should be refused. For that purpose, I assumed that this Court had power to grant bail. That question was not addressed by the applicant, counsel for whom was able to provide no assistance to the Court as to the source of its power, or its possible limitations.

184 The issues raised by the application are of potential importance. They include the following:

185 In Little v Governor of Pentridge Prison (1991) 66 ALJR 213, Dawson J held:

Chitty’s Treatise on the Criminal Law

^nd

involved a committal for civil contempt. His Honour left open the availability of the inherent jurisdiction of the High Court in such circumstances. In Pelechowski v Registrar, Court of Appeal (1998) 72 ALJR 711 at 712, Gummow J referred to the analysis in Witham v Holloway to the effect that “all proceedings for contempt are realistically to be seen as criminal in nature”. His Honour continued:

Little v Governor of Pentridge Prison

187 As appears from his Honour’s earlier reference to Jennings Construction Ltd v Burgundy Royale Investments Pty Ltd [1986] HCA 84; 161 CLR 681, his Honour treated the application as one for a stay of the judgment pending determination of an application for special leave to appeal: at [3]. He imposed conditions of a kind common on a bail application and added the following order 7:

“That the time during which the applicant is out on bail pursuant to this order should not be taken into account in calculating the period of service of his sentence pursuant to the judgment of the New South Wales Court of Appeal.”

188 Before considering the operation of the inherent jurisdiction of the Court, it is convenient to note that the Bail Act 1978 (NSW) does not in terms apply to a committal for civil contempt. Nor does the abolition of common law powers to grant bail operate, because the abolition is limited to the power to grant bail “to an accused person in or in connection with criminal proceedings”: s 62. Nor does that Act affect a power to grant bail with respect to criminal proceedings for contempt, s 64(1) relevantly providing:

64 Contempt

(1) Nothing in this Act affects any power or duty that a court, tribunal or person has to grant bail, or to grant relief in the nature of bail, in connection with any contempt or alleged contempt.”

189 A second problem which arises with respect to a grant of bail is the effect on the order of committal. In Whan v McConaghy [1984] HCA 22; 153 CLR 631 at 638, Mason, Murphy, Wilson and Deane JJ stated:

“Notwithstanding that, in its modern garb, bail may operate more as a form of conditional liberty than as a form of alternative custody (as it used to do when the bailed person was given over into the custody of his sureties), and thereby assume a character more akin in effect to a stay of execution of an order, it does not of itself interfere with the operation of the order …. A stay of execution, as its name implies, operates directly on the judgment or order the subject of the stay. Bail, in the absence of the exercise of any associated or supplementary powers that may be available, merely authorizes the accused person to be at liberty notwithstanding the operation of the sentence. That being so, in the circumstances of the present case, at the time when the Court of Appeal purported to direct that the sentence of the applicant commence on a new and future date, the sentence of three months imposed had already run its term.”

190 In Whan the problem arose because the challenge to the sentence of imprisonment was not taken pursuant to statutory provisions in respect of criminal appeals, but by way of an application for judicial review to this Court. In circumstances where the bail orders “did not have the effect of suspending or postponing the operation of the sentences” the joint judgment in Whan held that the sentences continued run and that this Court “had no inherent jurisdiction to substitute a fresh order of commitment for a sentence which had expired” and “had no statutory power, similar to that possessed by the Court of Criminal Appeal, to vary the sentence so as to take account of the period spend on bail”: at 639.

191 These principles were applied in Parker v Director of Public Prosecutions (1992) 28 NSWLR 282 at 299 (Kirby P, Handley and Sheller JJA agreeing), but they do not necessarily apply to the exercise of jurisdiction in this Court with respect to an appeal against a committal for civil contempt. As discussed above, the jurisdiction of this Court is to be found in the Supreme Court Act, s 101(5) and the powers of the Court in s 75A. While it may be that, just as the inherent jurisdiction of this Court may not extend to sentencing a convicted person to a term of imprisonment, so s 23 of the Supreme Court Act, conferring “all jurisdiction which may be necessary for the administration of justice in New South Wales”, may not extend so far: cf Whan at 642-643 (Brennan J). That issue does not need to be addressed, however, in relation to a civil contempt.

192 Nor, in the circumstances where bail was refused, does it become necessary to consider the form of an order which might be required in order to provide proper authority for the jailer to release a person held pursuant to a warrant of committal, nor whether an order in the form adopted by Gummow J in Pelechowski will be effective to suspend the period of the sentence or whether the Court should exercise its powers under s 75A to vary the order of the primary judge. Nor is it necessary to consider the power of the Court to enforce an order of conditional release.

193 It may also be accepted, on the basis of Pelechowski, that this being a first level of appeal against the decision of the primary judge, that fact is a relevant consideration in favour of a grant of bail, in addition to consideration of the prospects of success on the appeal and the extent to which the sentence is likely to be served prior to determination of the appeal: see United Mexican States v Cabal [2001] HCA 60; 209 CLR 165 at [43] (Gleeson CJ, McHugh and Gummow JJ). Bail was refused in the present case without the need to give weight to that factor.

194 CAMPBELL JA: Subject to one qualification, I agree with the reasons of Tobias JA. The qualification is that I prefer the view of Basten JA that the allegation that the business was undertaken “directly” is a matter of particularisation rather than an element of the charge. I take that view because the prohibition created by the orders of Santow J was on the appellant “directly or indirectly” carrying out particular types of activity. The breach of each of the two relevant orders consisted in the appellant having carried out that type of activity. That he did it “directly” was merely the particular mode by which he carried out the forbidden type of activity.

195 I also agree with the supplementary remarks of Basten JA, other than those in paragraphs [4], [11]-[18], and [32]-[43]. One reason why I withhold agreement from those paragraphs is that the question of whether the contempt involved in the present case was a civil or a criminal contempt was not fully argued.

196 The discussion of the course of authority in Markisic v Commonwealth of Australia [2007] NSWCA 92; (2007) 69 NSWLR 737 at [37]-[57] shows some of the difficulties in drawing the distinction between civil and criminal contempt.

197 I do not read the decision in Hearne v Street as resolving any general question about the basis on which one distinguishes civil contempts from criminal contempts. At [130] Hayne, Heydon and Crennan JJ referred to some remarks of Ipp JA in which his Honour identified circumstances that would “prima facie” be regarded as a civil contempt, or that would “tend to show” that the contempt is civil, but at [131] Hayne, Heydon and Crennan JJ declined to decide the correctness of those remarks. In any event, the remarks of Ipp JA do not purport to be a definitive statement of where the difference between civil and criminal contempt lies. The reasoning of the High Court majority in Hearne v Street at [135]-[140] as to why the contempt involved in the case before them was civil, was closely tied to the facts of the case. Insofar as a theme can be perceived in the facts to which their Honours pointed, it is that in the circumstances, the taking of the contempt proceedings was capable of advancing legitimate private interests of the people who had brought those proceedings, and hence that the proceedings should not be characterised as punitive in nature, rather than being remedial or coercive. I understand “coercive” in this context to mean that the contempt proceedings provided a means of providing pressure for those in breach to comply with their obligations in the future, by providing a practical lesson to them about the sort of consequences that can flow from failure to observe those obligations.

198 In John Fairfax Publications Pty Ltd v Attorney-General (NSW) [2000] NSWCA 198; (2000) 181 ALR 694; 158 FLR 81 at [5], Spigelman CJ identified what had traditionally been regarded as criminal contempt as being “proceedings which are not remedial or coercive in the interests of a private individual.” There is an argument, that has not been explored in the present case, about whether the fact that the contempt proceedings in the present case were brought by ASIC to advance a public interest, rather than any private interest of its own, affects any decision about whether the proceedings should be characterised as civil or criminal contempt.

199 For these reasons, I prefer not to decide whether the contempt in the present case was civil or criminal

200 I also prefer to assume, without deciding, that the court had power to grant bail in the present case. By the end of the argument my view was that the appeal would fail. That was my reason for joining in the order of the Court refusing bail.

201 I agree with the orders proposed by Tobias JA.

**********

Citations

Matthews v Australian Securities and Investments Commission [2009] NSWCA 155

Most Recent Citation

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CITATION:	Matthews v ASIC [2009] NSWCA 155
HEARING DATE(S):	27 May 2009
JUDGMENT DATE:	22 June 2009
JUDGMENT OF:	Tobias JA at 1; Basten JA at 151; Campbell JA at 194
DECISION:	Appeal dismissed with costs
CATCHWORDS:	PROCEDURE – Contempt, attachment and sequestration – Contempt – What constitutes –Disobedience of orders of court – Procedure – Difference between civil and criminal contempt – Statement of charge – Facts required to be proved to establish charge – Elements of charge – Whether information in charge comprised elements or particulars of charge – Whether all particulars of charge required to be made out for each element of charge to be proven – Evidence – Burden and standard of proof – Whether each element of charge proved beyond reasonable doubt – Interpretation – Construction of court orders – Whether primary judge erred in construing orders in accordance with definitions and terminology in Corporations Law – Whether primary judge erred in substituting a reference in orders to repealed Corporations Law for Corporations Act – Construction of phrase “undertaking a business” – Whether sending letter to 1,650 recipients containing investment advice amounted to undertaking a business of advising about and dealing in securities - APPEAL – Appeal against sentence – Grounds for interference – Whether primary judge attributed suitable weight to various matters – Bail – Application for bail – Power of Court of Appeal to grant bail in respect of committal for contempt pending determination of appeal and effect of any such grant of bail
LEGISLATION CITED:	Bail Act 1978 Civil Procedure Act 2005 Companies Act 1938 (Vic) Corporations Act 2001 (Cth) Corporations Law Occupational Health Safety and Welfare Act 1986 (SA) Supreme Court Act 1970 Supreme Court Rules 1970
CASES CITED:	Athens v Randwick City Council [2005] NSWCA 317; (2005) 64 NSWLR 58 Australasian Meat Industry Employees’ Union v Mudginberri Station Pty Ltd [1986] HCA 46; (1986) 161 CLR 98 Australian Securities and Investments Commission v Edensor Nominees Pty Ltd [2001] HCA 1; (2001) 204 CLR 559 Australian Securities and Investments Commission v Matthews [2009] NSWSC 77 Australian Securities and Investments Commission v Matthews [2009] NSWSC 285 Bovis Lend Lease v Construction Forestry Mining & Energy Union [2009] FCA 194; (2009) 254 ALR 306 Carew Reid & Ors v Carew Corporation Pty Ltd (Full Court of the Supreme Court of Western Australia, 23 April 1993, unreported) Chiltern District Council v Keane [1985] 1 WLR 619 Concrete Constructions Pty Ltd v Plumbers & Gas Fitters Employees Union (No 2) [1987] FCA 117; (1987) 15 FCR 64 Coward v Stapleton [1953] HCA 48; (1953) 90 CLR 573 Diemould Tooling Services Pty Ltd v Oaten; Santos Ltd v Marcos [2008] SASC 197; (2008) 101 SASR 339
PARTIES:	Stephen Lewis Matthews Australian Securities and Investments Commission
FILE NUMBER(S):	CA 40130/09
COUNSEL:	A: P Taylor SC / Richard Killalea R: D Stack
SOLICITORS:	A: N/A R: Conrad Gray, ASIC, Sydney
LOWER COURT JURISDICTION:	Supreme Court
LOWER COURT FILE NUMBER(S):	SC 1635/00
LOWER COURT JUDICIAL OFFICER:	Barrett J
LOWER COURT DATE OF DECISION:	25 February 2009
LOWER COURT MEDIUM NEUTRAL CITATION:	ASIC v Matthews [2009] NSWSC 77