McMahon v Director General, Department of Fair Trading

[2003] NSWADT 164

CITATION:	McMahon v Director General, Department of Fair Trading [2003] NSWADT 164 revised - 10/07/2003
DIVISION:	General Division
PARTIES:	APPLICANT Stephen McMahon RESPONDENT Director General, Department of Fair Trading
FILE NUMBER:	023288
HEARING DATES:	16/04/2003
SUBMISSIONS CLOSED:	04/16/2003
DATE OF DECISION:	07/11/2003
BEFORE:	Higgins S - Judicial Member
APPLICATION:	access to documents - confidential material - access to documents - personal affairs
MATTER FOR DECISION:	Principal matter
LEGISLATION CITED:	Freedom of Information Act 1989 Home Building Act 1989
CASES CITED:	McMahon v Director General, Department of Fair Trading [2003] NSWADT 63 Woods v Chief Executive Officer, State Rail Authority [2002] NSWADT 253 Re Maher and Attorney General's Department (1985) 7 ALD 731 Re B and Brisbane North Regional Health Authority (1994) 1 QAR 279 Wiseman v Commonwealth, unreported, Federal Court, 24 October 1989 Ryder v Booth [1985] VR 870
REPRESENTATION:	APPLICANT In person RESPONDENT M Allars, barrister
ORDERS:	The decision of the Director General to refuse access to the document, dated 21 May 2001, is affirmed.

Background

1 Mr Mc Mahon has made an application seeking review of a decision of the Director General, Department of Fair Trading (“Director General”), to refuse him access to a document, dated 21 May 2001, from his former defacto wife Ms Mary Kumar. Mr McMahon had requested access to the document pursuant to the Freedom of Information Act 1989 (“FOI Act”) and the Director General refused access to the document on the grounds that it was an exempt document under cls. 6 and 13(b) of Schedule 1 of the FOI Act. That is, access was refused on the grounds that the document contained information concerning the personal affairs of another person and that it contained confidential information.

2 The Director General made his original determination on 2 August 2002 and his determination was affirmed on 6 September 2002, following Mr McMahon’s request for an internal review of the original decision. Mr Mc Mahon initially lodged an application with the Tribunal for review on 14 November 2002. The question of whether Mr McMahon had lodged his application within the time prescribed by the FOI Act was raised as a preliminary issue. After a short hearing on this issue, the Tribunal determined that it had been lodged within time: McMahon v Director General, Department of Fair Trading [2003] NSWADT 63.

Evidence

3 Mr McMahon did not give any sworn evidence in respect of his substantive claim.

4 Ms Allars, on behalf of the Director General, provided the Tribunal, on a confidential basis, pursuant to s. 55 of the FOI Act, a copy of the document that is the subject of this application and a confidential affidavit.

5 Ms Allars also tendered into evidence two non confidential affidavits. The first affidavit was that of Rebecca Kiu, solicitor, employed with the Department of Fair Trading (”the Department”), affirmed on 14 April 2003. In her affidavit Ms Kiu made reference to the Department’s Privacy Management Plan (dated October 2000), Privacy Code of Practice (undated) and the Code of Conduct for the Department’s staff (dated March 2002). Annexed to her affidavit was a copy of each of these documents.

6 The other affidavit was that of Peter Edward Smith, Director of Licensing and Industry Standards in the Home Building Service (“the Service”), sworn on 3 April 2003. In his affidavit Mr Smith states that the Service is currently part of the Department of Commerce, but was formerly the Office of Home Building in the Department. A function of the Service and the previous Office of Home Building includes the holding of assets, rights and liabilities of the Building Services Corporation, which was the insurer of the Building Services Corporation Insurance Scheme (“the Insurance Scheme”). The Service administers the Insurance Scheme, which enables owners of residential dwellings to make a claim for compensation, of up to $100,000, for defective work that has been carried out by a contractor in regard to that dwelling, where the contract between the owner and contractor comes within the terms of the Scheme. The Trading Administration Corporation (“FTAC”) is responsible for the payment of claims under the Insurance Scheme. All claims are paid out of consolidated revenue.

7 Mr Smith states that as a public authority the Service and the FTAC police the operation of the Insurance Scheme to ensure that public monies are properly applied. In this regard the Service conducts inquiries or investigations so as to assess the merits of any claim that has been made. It also relies heavily on unsolicited information from business competitors, clients, family members, neighbours and other persons in respect of such claims and other functions that it administers. Such information he states is generally given in confidence.

8 Mr Smith states that the Service has a practice of keeping all unsolicited information confidential as members of the public are generally reluctant to become involved. By adopting this practice the Service has created an environment that encourages members of the public to come forward with information. A significant number of offences committed pursuant to the Home Building Act 1989 and prosecuted by the Service would not have been detected without the Service receiving such information. Accordingly, in Mr Smith’s view, a disclosure of such information as contained in the document the subject of this application, would have a serious effect on the Service fulfilling its various functions that are consumer protection in nature.

9 Mr Smith also gave a brief history of Mr McMahon’s dealings with the Service. These were not disputed. In summary the evidence is that, in June 1998, Mr McMahon made a claim pursuant to the Insurance Scheme for allegedly defective building work to his home. In February 1999, Mr McMahon’s claim was partially approved. Mr McMahon appealed this decision to the Fair Trading Tribunal and these proceedings were finally settled in May 2001. In assessing the merits of his claim, Mr Smith states that certain enquiries and inspections were made by the Service and at the same time the Service received information in regard to their enquiries on a confidential basis.

Relevant Law

10 Section 5(2)(b) of the FOI Act confers on each member of the public:

“…a legally enforceable right to be given access to documents held by the Government, subject only to such restrictions as are reasonably necessary for the proper administration of the Government.”
11 The government agency on whom a request for access to documents has been made is required to consider the application, identify the documents that come within the request and give access to the documents being sought unless it can establish that the document is an exempt document under one or more of the provisions contained in Schedule 1 of the FOI Act (s 25(1)(a) of the FOI Act) or one of the other grounds on which access can be refused (s. 25(1)(a1) – (d) and (3)). The onus of proof lies on the agency to establish that the exemption applies and the denial of access is justified (see s.61 of the FOI Act).

12 Cl 6 of Schedule 1 of the FOI Act provides for an exemption where the document relates to the personal affairs of a person. That clause provides as follows:

Cl. 6 Documents affecting personal affairs

(1) A document is an exempt document if it contains matter the disclosure of which would involve the unreasonable disclosure of information concerning the personal affairs of any person (whether living or deceased).

(2) A document is not an exempt document by virtue of this clause merely because it contains information concerning the person by or on whose behalf an application for access to the document is being made.

13 Where access is sought to a document that concerns the personal affairs of a person other than the access application, section 31 of the FOI Act makes provision for the agency to consult the person concerned.

14 Cl 13 of Schedule 1 of the FOI Act provides for an exemption where the document contains confidential information. That clause provides as follows:

Cl. 13 Documents containing confidential material

A document is an exempt document:

(a) if it contains matter the disclosure of which would found an action for breach of confidence, or

(b) if it contains matter the disclosure of which:

(i) would otherwise disclose information obtained in confidence, and

(ii) could reasonably be expected to prejudice the future supply of such information to the Government or to an agency, and

(iii) would, on balance, be contrary to the public interest.

15 Where a document for which access has been requested is found to be an exempt document, s. 25(4) of the FOI Act provides that the agency is prohibited from refusing access to that document if it is practicable to give access to a copy of the document from which the exempt matter is deleted and the access applicant would wish to have such a copy.

Submissions

16 Ms Allars, on behalf of the Director General, provided detailed written submissions. In respect of the personal affairs exemption, Ms Allars submitted that the contents of the document the subject of this application clearly demonstrated that it contained information about the personal affairs of the author of the document. She also submitted that in the circumstances in which the document was forwarded to the Department that it was unreasonable for this information to be disclosed. In respect of the confidential information exemption, Ms Allars submitted that both limbs of cl 13 of Schedule 1 of the FOI Act are satisfied by the evidence.

17 Mr McMahon stated that he was fully aware of the contents of the document and submitted that it was made up of lies, which had been accepted by the Department as being incorrect. The Department’s settlement of his claim for the full amount claimed, he states is evidence of this acceptance. He stated that the Department had failed to act on what he believed to be false accusations and could not see why the Department was refusing him access in the circumstances.

Findings and Reasons

18 The Tribunal has considered all the evidence that was before it, including the contents of the exempt document and the confidential affidavit. While the Tribunal can understand Mr McMahon’s frustration in being denied access to the document in question, as was explained to him during the hearing, his belief as to the contents of the document and that they were lies was of no relevance to his application. In determining his application for review the Tribunal was required to determine whether the Director General’s decision in refusing him access to the document was the correct and preferred decision in respect of the document the subject of this application in light of the provisions of the FOI Act and any other relevant law.

19 While the Director General has relied on two exemptions contained in Schedule 1 of the FOI Act, both do not necessarily need to be satisfied in order to affirm the decision of the Director General.

20 As the essence of the evidence is to the effect that the document was provided in confidence, it is convenient to first deal with the exemption contained in cl. 13(b) of Schedule 1 of the FOI Act.

21 In order to be able to rely on this exemption the Director General must establish the following:

(a) release of the document would disclose information obtained in confidence;

(b) disclosure would reasonably be expected to prejudice the future supply of such information to it; and

(c) the disclosure would on balance, be contrary to the public interest.

22 The rationale for this exemption is to protect the flow of confidential information to Government and its agencies, which depend on such information in order to fulfil their specific functions.

23 It is well established (see Woods v Chief Executive Officer, State Rail Authority [2002] NSWADT 253 at [52]) that in order for information to be "obtained in confidence" it must be shown that it was "communicated and received under an expressed or inferred understanding that [it] would be kept confidential." (see Re Maher and Attorney General's Department (1985) 7 ALD 731 at 737 and Re B and Brisbane North Regional Health Authority (1994) 1 QAR 279 at 338). Confidentiality can be inferred from all the circumstances (see Wiseman v Commonwealth, unreported, Federal Court, 24 October 1989).

24 On the basis of the evidence of Mr Smith and the evidence contained in the confidential affidavit, the Tribunal is satisfied that the Director General has established that the document was provided to the Department in confidence and that the Department through its practices and procedures has at all times treated it as being confidential. Accordingly, the Tribunal is satisfied that release of the document would disclose information obtained in confidence. As mentioned above, whether the document contained information that was true or false is of no relevance in this regard.

25 In respect of determining whether disclosure of the information would “prejudice” the future supply of such information to the agency, it is well established that the test is not whether the particular confider whose confidential information is being considered for disclosure, could reasonably be expected to refuse to supply such information in future. The test is whether the agency will be able to obtain such information in the future (see Ryder v Booth [1985] VR 870 at 872 and Re B and Brisbane North Regional Health Authority (1994) 1 QAR 279 at 341).

26 The Tribunal agrees with Ms Allars’ submission that, in this case, it is the nature of the contents of the document, the subject of this application, which is relevant to the consideration of whether disclosure of the document could reasonably be expected to prejudice the future supply of such information. The fact that Mr McMahon is aware of the name of the author of the document does not mean that its contents are no longer exempt. In this regard, the Director General in his internal review determination stated that the Department, like other law enforcement agencies, “is often provided with information by persons who can be termed “insiders” (relatives, partners, friends, employees or business associates)”. Mr Smith’s affidavit confirms this. However, he goes further and states that the Department or the Service are largely reliant on receiving information of the nature contained in the document, the subject of this application, to identify possible breaches of the Home Building Act 1989 and false claims under the Insurance Scheme. As it is reliant on information of this nature it accepts information of this nature on a confidential basis and members of the public have come to trust the Department and the Service in this regard. That confidence only being breached with the consent of the author of the document in accordance with the privacy policies of the Department.

27 In the circumstances, the Tribunal accepts the statement of Mr Smith that a disclosure of the document, the subject of this application, would prejudice the future supply of such information.

28 The objects of the FOI Act are to provide members of the public with access to documents held by Government and its agencies (s. 5(1) FOI Act). Accordingly, the public interest lies in disclosure of documents. However, by providing specific exemptions in Schedule 1 of the FOI Act, Parliament has indicated that these are the circumstances in which it is in the public interest for a document not to be disclosed. As mentioned above, in regard to information obtained in confidence, it is in the public interest for such information to remain confidential where the Government or agency relies on such information to enforce compliance with laws that have been enacted to protect the public. Accordingly, in determining whether the disclosure of a document received in confidence would on balance, be contrary to the public interest, consideration must be given to all the circumstances in which the document was provided and whether its disclosure would be contrary to the public interest in having such information remain confidential.

29 In the opinion of the Tribunal, having regard to the nature of the document, the circumstances in which it was received, and the reliance placed on the Department or Service in obtaining information of this nature in fulfilling its functions, a disclosure of the document would be contrary to the public interest.

30 Mr McMahon has not demonstrated any legitimate need for the document. His only reason for making the request for access is so that he is able to verify what he believes to be its contents and thereby establish its falsity. With respect, this is not a legitimate need that justifies a disclosure of a document that is otherwise exempt.

31 Accordingly, the Tribunal finds that the Director General’s decision that the document is exempt under cl 13(b) of Schedule 1 of the FOI Act is the correct and preferred decision. Furthermore, the Tribunal finds that the whole of the document is exempt, making the operation of s. 25(4) of the FOI Act inapplicable.

32 As a result of the Tribunal’s findings in respect of cl 13(b) of Schedule 1 of the FOI Act it is unnecessary to consider the other exemptions relied on by the Director General.

33 The Tribunal orders that the decision of the Director General to refuse access to the document, dated 21 May 2001, is affirmed.