MF1; MF2; MES v National Crime Authority

[1992] HCATrans 71

•

.

.,.

•

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Melbourne No MB of 1992

B e t w e e n -

MFI

Applicant

and

NATIONAL CRIME AUTHORITY

Respondent

Office of the Registry

Melbourne	No M9 of 1992
MF2

Applicant

and

NATIONAL CRIME AUTHORITY

Respondent

Office of the Registry

Melbourne	No Ml0 of 1992
MES

1 12/3/92

Applicant

and

NATIONAL CRIME AUTHORITY

Respondent

Applications for special
leave to appeal

MASON CJ DAWSON J GAUDRON J

TRANSCRIPT OF PROCEEDINGS

AT MELBOURNE ON THURSDAY, 12 MARCH 1992, AT 3.48 PM

Copyright in the High Court of Australia

MR T.E.F. HUGHES, QC:  May it please the Court, in each of

those applications, I appear with my learned

friend, MR T.P. MURPHY, for the applicant.

(instructed by Corrs Chambers Westgarth)

MR M. WEINBERG, QC:  May it please the Court, in each of

those applications, I appear with my learned

friend, MR B.E. WALTERS, on behalf of the

respondent. (instructed by the Australian

Government Solicitor)

MASON CJ: Yes, Mr Hughes.

MR HUGHES:  Your Honours, we have prepared an outline. May

I hand up four copies.

MASON CJ: Yes.

MR HUGHES:  We have also prepared a folder of some

materials, including principally the Act under

consideration in the courts below.

MASON CJ:  You are not putting forward all these points as

special leave points, are you?

MR HUGHES:  No. There is one point, and I should perhaps

clear the decks.

MASON CJ: Yes. We have spent a lot of time looking at a

number of ·points that -

MR HUGHES: Well, I am sorry. I came into the matter late,

Your Honours, so I did not have the opportunity of

using the pruning knife.

2   12/3/92

MASON CJ:  I suppose I should express our thanks to you that

you have come into the matter.

MR HUGHES:  I am obliged.

MASON CJ: Only on the footing that you have managed to

exclude some questions from the case.

MR HUGHES:	Well now, one matter that we are excluding is this corporation point. Having taken notice of
what Your Honour said in Rochfort's case and of the views in the Court of Appeal in England which
appeal to Your Honour.
MASON CJ:	On the other hand, that was the one point your opponents conceded to be an arguable point.
MR HUGHES:	I know that, but when one looks at the

legislation there is one irrefragable answer to

that point, even though it was conceded to be

arguable. I will probably have to pass through

that point as I invite Your Honours to look at the

legislation.

MASON CJ:  Yes. Can you identify for us what is the

substantial point that you are seeking to agitate.

MR HUGHES:  Yes. The point is this: what, on the true

construction of section 28, are the limits of

relevance upon the scope of the Authority's powers

to require the production of documents under that

section. Allied to that point is a question of

onus. Whose onus is it when objection is taken to

a summons purporting to be issued under 28? Is it the Authority's onus to establish relevance, or is it, as was held in both courts below, the task of
the present applicants to establish that there are

no conceivable grounds upon which the demand for

documents contained in the summons could be

relevant?

Now, both those points will require a short

journey through the legislation, Your Honours. The

point I have endeavoured to encapsulate verbally is

in part contained in paragraph 3 of our

submissions. Would Your Honours wish to get the

flavour of the submissions by reading them first or

shall I go -

MASON CJ:	No, we c_an pick them up very quickly, Mr Hughes.
MR HUGHES:	Now, Your Honours, first of all I should invite

the Court's attention to the ruling by the

Authority which, in effect, was upheld because in

each of the courts below judicial review was

refused. With the Court's permission, in deference
to the extreme commercial sensitivity of this

3   12/3/92

matter, I propose not to use the actual name of the

parties but the pseudonyms which were adopted

below.

MASON CJ:	You are going to use ABC?
MR HUGHES:	ABC or - yes - in relation to one company and

MF3 in relation to the other company which is the subsidiary company, if that course has the Court's approval.

MASON CJ: That has the Court's approval.

MR HUGHES:	If Your Honour pleases. Would Your Honours be good enough to go to page 4 of the application
book, line 16, just below half-way down the page,
and the paragraphs I shall read encapsulate the
gravamen of the Authority's view on the
interpretation of the section.

Tha Authority is an investigatory body and its powers extend to matters which are relevant to

its terms of reference. This does not however

prevent the Authority from enquiring into any

matter which it bona fide believes would

assist it in its inquiry, providing it falls

within the terms of reference.

It is not for ABC to determine what is

relevant or irrelevant in relation to the

documents that are sought to be produced as

they are not to know what investigations have

taken place so far and what may or may not be

relevant as far as the inquiry is concerned.

In fact it is undesirable and may be

oppressive to require a person to make

judgments as to the relevance of their

documents to the issues being investigated.

It would not be apparent to ABC as to the way
in which such documents may be relevant to the

Authority's investigation, they not being

present throughout the course of the

Authority's hearings.

The documents sought relate to a defined class

of documents being Minutes of meetings of the

Board of Directors of ABC, including

attachments, annexures and documents recorded

in the Minutes. They relate to ABC which is

the subject of the investigation and to a

defined period of time that is covered by the

terms· of reference.

Therefore, in my opinion the documents sought in the Summons fall within the terms of reference, the Authority having the bona fide

4   12/3/92

belief that these documents will assist it in

the inquiry.

MASON CJ:  You have used the pseudonym to cover two

expressions, is that correct?

MR HUGHES:  Yes, Your Honour, because there was a change of

name.

MASON CJ:	I see.
MR HUGHES:	From one to the other and I think that occurred

after the Authority had given its decision.

MASON CJ: Yes.

MR HUGHES:  Now, that encapsulates the basis of the

Authority's conclusion. It will now be incumbent upon me to go to the Act, but first of all I should

invite Your Honours' attention to the fact that in

addition to the usual hurdles that an applicant for

special leave properly encounters, there is a

further one in this case, another fence I have to

jump, because unfortunately - and this is revealed

in an affidavit at page 106 - - -

MASON CJ: Well, this is this time question, is it?

MR HUGHES: This time question.

MASON CJ: Well, perhaps you might put that to one side for

the time being.

MR HUGHES:  Yes. If Your Honour pleases. Now the statutory

scheme - if I can etch it in as quickly as

possible, is this. This was a special

investigation being conducted by the Authority and

that term is defined on page 5 of the print of the

Act, as meaning:

an investigation that the Authority is

conducting in the performance of its special

functions.

special functions are delineated, Your Honours, in

section 11(2) on page 13 of the print:

The special functions of the Authority are:

(a} where a reference to the Authority made

under section 13 is in force in respect of a

matter relating to a relevant criminal

activity - to investigate the matter in so far

as the relevant offence is, or the relevant
offences are or include, an offence of

offences against a law of the Commonwealth -

12/3/92

And I will not read (b), Your Honours. It is a

corresponding provision in relation to references

by State Ministers in connection with relevant

criminal activity involving suggested breaches of

State laws. Then, if Your Honours would be good enough to go to page 15 of the print,

section 13(1):

The Minister -

that is the Commonwealth Minister -

may, after consulting the inter-Governmental

Committee, by notice in writing to the relevant criminal activity to the Authority

for investigation in so far as the relevant

offence is, or the relevant offences are or
include, an offence or offences against a law

of the Commonwealth or of a Territory.

Subsection (2) specifies what such a notice must

contain. It must:

describe the general nature of the
circumstances or allegations constituting the

relevant criminal activity -

I should have mentioned, Your Honours, that

"relevant criminal activity" is defined in that

definition section.	I do not think I need go back
to it.	The notice must:

(b) ..... state that the relevant offence is, or
the relevant offences are or include, an
offence of offences against a law of the
Commonwealth or a law of a Territory but need
not specify the particular offence or

offences; and

(c)shall set out the purpose of the

investigation.

Section 14 contains a corresponding provision in

relation to notices from State ministers and I will

not - section 14 is on page 16 of the print and I
need not read it because it follows the same

substantial content as that of section 13. Now, I

should next go to section 28 - perhaps first, on

the way, section 25(1), Your Honours, on page 28 of

the print:

For the purposes of a special investigation

the Authority may hold hearings.

Then, section 28(1):

6   12/3/92

A member may summon a person to appear before

the Authority at a hearing to give evidence

and to produce such documents or other things

(if any) as are referred to in the summons.

Now, I propose to refer rather specifically, if I

may, to subsections (2) and (3) because with

respect of both courts below, it may be said that

there was a failure to perceive the full effect of

each of these subsections as it bears upon the

questions that arise in this application.

Subsection (2):

A summons under subsection (1) requiring a

person to appear before the authority at a

hearing shall be accompanied by a copy of the
notice, or of each of the notices, by which

the matter or matters to which the hearing

relates was or were referred to the Authority

under section 13 or in accordance with

section 14.

(3) A summons under subsection (1) requiring a

person to appear before the Authority at a

hearing shall, unless the member issuing the

summons is satisfied that, in the particular

circumstances of a special investigation to

which the hearing relates, it would prejudice

the effectiveness of the special investigation

for the summons to do so, set out, so far as

is reasonably practicable, the general nature
of the matters in relation to which the

Authority intends to question the person, but

nothing in this subsection prevents the

Authority from questioning the person in

relation to any matter that relates to a

special investigation.

Now, that is the procedure for proceeding by way of

summons to procure the appearance of someone to

give evidence or produce documents. There is an

additional power to obtain documents, Your Honours,

in section 29, and this section received some

attention in the judgments below - subsection (1):

A member may, by notice in writing served on a

person, require the person:

(a) to attend ..... before a person specified in

the notice, being a member of the

Authority ..... and

(b) to produce at that time and place to the
person so specified a document or thing
specified in the notice, being a document or
thing that is relevant to a special
investigation.

7   12/3/92

Your Honours will notice that the power to proceed

under that subsection by notice in writing is

conditioned by requirement that the document

demanded must be relevant to the special

investigation. The onus is clearly on the

Authority, in case of dispute, to establish that proposition. Subsection (2):

A notice may be issued under this section in

relation to a special investigation whether or

not a hearing before the Authority is being held for the purposes of the investigation.

Then there is a penalty for failure without reasonable cause to comply with a notice.

Subsection (4):

Subsections 30(3) to (10), inclusive, apply in relation to a person who is required to

produce a document or thing by a notice served

on _him under this section in the same manner

as they apply in relation to a person who is

required to produce a document or thing at a hearing before the Authority and so apply as if a reference in those subsections to

subsection 30(2) were a reference to
subsection (3) of this section.

Then section 30, on page 34 - I need not read subsection (1) - fairly common form:

A person appearing as a witness at a hearing

before the Authority shall not, without

reasonable excuse -

relevantly -

(c) refuse or fail to produce a document or

thing that he was required to produce by a

summons under this Act served on him as

prescribed.

And then, if one goes, as I now invite Your Honours

to do, to subsection (9), on page 36, it says:

For the purposes of subsection (2):

(a) it is not a reasonable excuse for a
corporation to refuse or fail to produce a
document or thing that the production of the
document or thing might tend to incriminate

the corporation -

and I need not read any further. If one turns back

for a moment, if Your Honours would, to

section 30(2) and puts it alongside subsection (9),

it becomes quite apparent that a corporation can be

8   12/3/92

liable for a contravention of section 30(2)(c),

refusing or failing to produce a document that it

was required to produce by a summons. And that

explains, if I may say so, why we have dropped the

point that was conceded to be arguable.

MASON CJ: Yes. Well that was a point made, I think, in the

judgment of the court below, was it not?

MR HUGHES:  Yes, indeed. Now, the other sections that I

should invite Your Honours to notice are

section 32(l)(c), where:

a person claims to be entitled to refuse to

answer a question put to him, or to produce a

document that he was required to produce, at a

hearing before the Authority:

the Authority shall decide as soon as

practicable whether in its opinion the claim

is justified and notify the person of its

decision.

then, subsection (2) of that section says that:

if a person is dissatisfied with the decision,

he may apply to the Federal Court for an order

of review -

Subsection (4):

On an application for an order of review in respect of a decision of the Authority under subsection (1), the Federal Court may, in its

discretion, make an order:

(a) affirming the decision: or

(b) setting aside the decision.

Now, Your Honours will have noticed from the

reading of the sections to which I have alluded

that under section 29, "relevance" is a matter for

the Authority to establish, where the section 29

procedure is invoked. The question arises as to

where the proof of relevance lies, or irrelevance,
where the procedure under section 28 is invoked and

we say that the answer to that question is provided

when one considers the provisions of section 28(2), (3) and (7) - I did not read subsection (7) before, for which -I apologize - it is on page 32:

The powers conferred by this section are not

exercisable except for the purposes of a

special investigation.

So that limits the exercise of the subsection (1)

power to the purposes of the special investigation

9   12/3/92

and we go on to say that other limiting factors on

the exercise of the section 28 power are the

factors adverted in section 28(2) and (3). Now, at

this stage I should invite Your Honours attention

to the docum~nts that, in compliance with

section 28 - - -

MASON CJ: Just stopping there, there is no mention of

relevance as such in section 28, is there?

MR HUGHES:  No, there is a disconformity in that connection

between 28 and 29 in terms of expression. We say,

however, that although there is that disconformity

the notion of relevance is firmly embedded in

section 28 and as a condition precedent to the

exercise of the summons power, because of the provisions of subsection (7), subsections (2)

and (3), Mr Justice Heerey noticed subsection (7),

suggesting that it was the only limitation upon the

exercise of the summons power in section 28.	We
suggestr with respect, he was wrong, because he overlooked the limiting effect, in terms of

relevance of subsections (2) and (3). And, if I

may, I will invite Your Honours' attention now to

the three summons to show how the Authority went

about discharging its obligation under

subsections (2) and (3).

The first summons, Your Honours, is at

page 96, and it is to ABC by its proper officer. I

notice, Your Honours, that it is quarter past four,

do Your Honours wish me to proceed?

MASON CJ: Yes.

MR HUGHES:  Thank you, Your Honours. It says:

The National Crime Authority is conducting an

investigation into the matters that have been

referred to it as set out in the Notices

copies of which are annexed to this summons. And then the next paragraph -

Pursuant to sub-section 28(1) of the National

Crime Authority Act 1984, you are hereby

summoned:

(a) to appear ..... to give evidence in relation
to the investigation and to produce the

documents specified in the Schedule annexed

hereto.

Now the Schedule is on the next page:

All minutes of meetings of the board of directors of ABC including attachments,

10   12/3/92

annexures and documents recorded in the said

minutes as being tabled, discussed or approved

between 1 January 1986 and 1 January 1989.

That was the first summons. The second summons is

at page 127, Your Honours. It is also to ABC by

its proper officer, and it is in the same

substantial form, required to attend:

to give evidence in relation to the

investigation and to produce the documents.

The difference between the summons at page 127 and

the summons at page 96, is that the summons at

page 127 says:

The Authority intends to question you in

relation to the documents specified in the

Schedule -

whereas the earlier summons at 96 does not so

state. The Schedule to the second summons is at

page 129 and it says:

All minutes of meetings of the Board of Directors of ABC including attachments,

annexures and documents recorded in the said

minutes as being tabled discussed or approved

between 1 January 1989 and 1 November 1989.

So that extended the range of the requirement by an

additional year. The third summons is at page 161,

Your Honours, and it is to the secretary of MFI and

it requires that person "to appear", "to give

evidence" and "produce the documents specified in the Schedule". It, like the second summons, goes

on to say:

The Authority intends to question you in

relation to the documents specified in the

Schedule -

The Schedule is at page 163. It specified:

All minutes of meetings of the Board of

Directors of MFI, including attachments,

annexures and documents recorded in the said

minutes as being tabled, discussed or approved

between 1 January 1986 and 1 November 1989.

So it is directed to an associated company; that is

associated· with ABC and requires its minutes, that

is the associate's minutes. Now the notice under

section 28(2) is to be found at page 89. It is

perhaps important, Your Honours, for me to devote a

little attention to the specific terms of this

notice, because we say the terms of this notice set

11   12/3/92

the boundaries of relevance in relation to the

documents that may be included within the

section 28 summons. It says that the Minister

refers:

to the National Crime Authority for

investigation the following matter relating to

a relevant criminal activity insofar as the

relevant offence or relevant offences are or
include an offence of offences against the law

of the Commonwealth or of a Territory.

MATTER

Whether any relevant offences have been committed as alleged in the allegations

particulars of which are set out below, and if

so the identity of the person or persons

involved and the nature of their involvement.

PARTICULARS PURSUANT TO SUBSECTION 13(2)

(A) The general nature of the allegations is:

and I have endeavoured, Your Honour, for the sake

of convenience, because this is rather a lumpy
piece of prose - the particulars - to set out the
essence of what is in the particulars in the way of

specifying the subject-matter.

MASON CJ:	You mean, you have translated it into English?
MR HUGHES:	Yes, well I tried to, somewhat constrained by

the necessity, in the interests of accuracy, to

follow the prose form of the draftsman.

MASON CJ:  I suppose it would be an idle inquiry; is it an

accurate translation?

MR HUGHES:  I hope so. It is not designed to be inaccurate

and I must stand up to examination on that.	We say
the effect of the notices is to confine the

legitimate scope of a hearing conducted in aid of
the special investigation in this case to the
following topics - and we seek to extrapolate these

from the particulars of the general nature of the

allegations:

(a) Whether any, and, if so, which directors of ABC

Limited were directly or indirectly involved in

transactions relating to the disposal or

acquisition of securities in ABC Limited either

alone or in concert with other (and, if so, which

other) persons.

(b) Whether any of such directors improperly used
their positions as such or improperly used

12   12/3/92

information acquired by virtue of their position to

gain any (and, if so, what) advantages for

themselves or for other persons or to cause

detriment to the Company, and

(c) Whether any of those directors - I suppose one

should say, and and if so, which, of those

directors - failed, alone or in concert with others
to act honestly in relation to the transactions

referred to in (a) in the exercise of their powers

and duties as directors of ABC Limited.	And then
the particulars go on to say that:

The allegations constitute irrelevant criminal

activity because the alleged activities may

have constituted, or may be continuing to

constitute, an offence against a law of the

Commonwealth or of a Territory -

and various elements in the possible offences are there set out, but (b), of course, hinges on (a).

That is why we have been at pains to try and

clarify the content of (a) in the notice. I should say, Your Honours, that the notices to the National

Crime Authority from the relevant State ministers

are set out at pages 91, in the case of Victoria

and 93 in the case of South Australia and it is not

necessary for me to go through the same sort of

tedious exercise of getting the meaning of those

particulars because they follow the substance

exactly of the particulars in the Commonwealth

notice.

Then there is another document which came to

us, that is a document which appears at page 131,

which was given to the applicants with these other

documents - with the summonses, in fact. This

document at page 131 was given to ABC along with

the second summons, and it is headed:

STATEMENT IN SUPPORT OF S28 SUMMONS/S29 NOTICE

Directed to ABC by its proper officer -

paragraph 5:

The general nature of the matters in relation

to which the authority requires the documents

is:

to obtain evidence relating to the discussions ABC

management had with other Board members at Board

meetings in relation to the management buy-out of

ABC and its component parts, also to see whether

there was any difference in the nature of matters

discussed at Board committee meetings in relation

to the buy-out.

13   12/3/92

MASON CJ: What is that, a 28(3) document, is it.

MR HUGHES: That, we take to be a 28(3) notification,

Your Honour, and goes on to say that:

The setting out of such matters in the summons

would prejudice -

my learned friend takes issue with the proposition

that it was a 28(3) document. It was given to us,

whether or not it is a 28(3) document and of course

it can be used as part of the material upon which

one can evaluate the relevance to this special

some four years and every board minute of MFI, irrespective of its content, over a period I think of three years, roughly the same period.

investigation of calling for every board minute of

MASON CJ: If this document is not a 28(3) document, what

prominence does it have?

MR HUGHES:  It was part of the material before the Federal

Court and Mr Weinberg has suggested, and I am

perfectly happy to accept his suggestion, that it

was provided to the applicant, which would be ABC,

with the second summons - my learned friend says in

error - but sometimes out of error - - -

DAWSON J: Well, it seems a very document to give - you give

the very information which is said to prejudice the

conduct of the hearing.

MR HUGHES: Yes, well that is what they have done and it is

material that can be used, we venture to suggest, to evaluate the validity of this dragnet summons.

Now, I should tell Your Honours, just to etch in

the background - and my learned friend will correct

me if he thinks I am wrong in any respect in what I

am about to say - that the attitude taken up by ABC

and MFI was to produce to the Authority such of the

numerous minutes comprised in the dragnet summonses	as appear to bear upon the subjects of
investigation as delineated in the statutory
reference notice.

The applicants took the course of providing to

the Authority what came to be described as

"skeleton minutes", a bundle very thick and I do

not want to burden the Court with it, it is not in

the application book so I probably cannot -

skeleton minutes which indicated, in relation to

each board meeting, the topic heading to which the minutes related, in an endeavour to show that such

topics, on their face, simply had nothing to do

with the subject-matter delineated in the

particulars contained in the reference notice. And

14   12/3/92

that is the basis upon which Mr Leckie, the member
of the Authority who dealt with this matter, gave

his decision.

As we have observed in the outline, the case

was dealt with at both levels below, that is before

Mr Justice Heerey and before the Full Court, on the

footing that they, apparently, did not look at any
of these documents but just made a generalized
judgment short of going to the content, either of

the full minutes that were produced or the skeleton

minutes.

Now, those are the facts and the statutory

circumstances which give rise to the question which

we say would justify, with respect, the grant of

special leave. What we say about where the onus of

establishing relevance lies, is that it certainly

lies on the Authority under section 29, and there

seems no- reason, unless there are compelling

textual reasons to the contrary in section 28, for

liberating the Authority from such an onus where it

uses the procedure of a summons, and we say that the reason why section 28 tells one that the onus of establishing relevance rests upon the Authority

when a summons falls to be considered, in terms of
whether it should be answered or whether it is too
wide, is that the procedure by way of summons can

only be used for the purposes of a special

investigation.

The purposes of a special investigation are defined, for the purposes of that investigation, by

the reference notice that has to be given to the

person summoned in order that the Authority may

comply with section 28(2). I will not say anything

about subsection (3) because there is a dispute,

and I can see the reason for it, about whether the

notice that escaped, the one at page 131, is a

subsection (3) notice.

So that we say, clearly, on the face of

section 28 the limits of relevance, the boundaries

of relevance, are clearly defined by those three comes into dispute. That is the point of construction or one point of construction, and the other point is that, on the proper approach to section 28 or what we venture to say is the proper
subsections in such a way that it is to the

approach to section 28, there must be
circumstances, and this case is classically one, in

which there is, because of what is required by the

summons, an inherent improbability that everything

that is asked for is relevant.

15   12/3/92

A large public company, in this case, a call

for all its minutes over four years, without

discrimination or limitation in the terms of the

summons in circumstances where the limits of the

inquiry are, as we suggest, set out in our

additional document that I handed up. So, we say

there is just an inherent improbability that every

one of those minutes - - -

MASON CJ: But it is not relevance to, what might be

described as the issues in (a), (b) and (c) is it,
it is relevance to an investigation into those

issues?

MR HUGHES: Into those issues, yes.

MASON CJ:  As to whether or not the directors, or any of

them and who they were, have participated in

transactions of that kind?

MR HUGHES:  In relation to the companies securities.

MASON CJ: That is right, and once you add to the statement

of the issues, as you call them in (a), (b) and

(c), the overall umbrella of investigation into

those issues, that immediately expands the ambit of

the area of the inquiry?

MR HUGHES:  But the ambit of the area of the inquiry is

necessarily limited, we would venture to suggest,
as a matter of construction by the statement of the
matters that are being investigated. That is the

point we seek to make.

MASON CJ: That is a reference point of some kind.

MR HUGHES:  Yes, and we say a critically important reference

point.

Now, we have endeavoured to encapsulate, in brief form, the respects in which we say the

Authority and the courts below went wrong. I have

read to Your Honours the passage in the Authority's

decision where it took up its position on the issue
of relevance, and in summary form what the

Authority said was:	(a) The companies concerned
are the subject of the investigation.	(b) The

documents relate to that subject and to a defined

period of time covered by the term of reference and

(c) NCA has a bona fide belief that compliance with

the summonses will assist it in its investigation.

As to proposition (a) we say they were

plainly wrong because the companies are not the

subject of the investigation, the directors and

their alleged dealings in the companies securities

are the subject of the investigation. And we say

16   12/3/92

that the formulation of that proposition was
calculated to distract the Authority from the

question it was bound to consider.

Mr Justice Heerey, at first instance,

recognized that error but regarded it, we suggest,

erroneously as inconsequential. We say it was a

significant error because whatever may be said in

favour of the relevance of all board minutes of a

large public company over a defined and long period of time, if it or its activities are the subject of

investigation the position is, necessarily,

different if board minutes of such a company are

sought only in respect of particular transactions

engaged in by directors over such a period of time.

It is abundantly clear, we would venture to

submit, that not every board minute over all that

long period of time will constitute a reference to

such transactions, and that was the position taken

up before the Authority, and as to proposition (c),

we say that the Authority went wrong in its

interpretation of the Act because it gave

considerable importance to the element of belief in

good faith that the documents were relevant, and we

say, clearly, a belief in good faith that the

documents are relevant, and we did not challenge

the Authority's good faith, let me hasten to say,

is no substitute for relevance in an objective

sense.

GAUDRON J: Is there not some slipperiness in the notion of

"relevant" in the context of an investigation.

Does it mean anything more than may bear on, as

distinct from does bear on?

MR HUGHES:  We submit that it means "does bear on" because

it is not like the case upon which, in the courts

below, considerable reliance was placed, that is

the Melbourne Home of Ford case.	It is not a case
arising under a statutory provision like

section 155 of the Trade Practices Act which was,

in these terms, very different from section 28, we

venture to suggest.

GAUDRON J: It is just that the word "relevant" seems to me

to have a meaning that is somewhat different in the

context of an investigation from that which you

would give it in the context of a formal inquiry.

MR HUGHES:  I can c·oncede for the purposes of argument that

there is, or may be, a shade of difference, as

Your Honour suggests.

DAWSON J: It is not really a shade of difference,

Mr Hughes. I mean, the document may not be

relevant, when you look at it, conceivably

17   12/3/92

relevant, but you may have a right to investigate

it to see whether it is.

MR HUGHES: Well, that depends on the construction of

section 28. We propound a construction of

section 28 which makes relevance, as it clearly is

under section 29, a matter for the Authority to

establish. Now, it is unlike section 155 of the

Trade Practices Act which said:

Where the Commission, or the Chairman -

of the Trade Practices Commission -

has reason to believe that a person is capable

of furnishing information, producing documents

or giving evidence relating to a matter that

constitutes, or may constitute, a

contravention of this Act -

questions can be asked and documents called for -

very different terminology. If our approach to

section 28 is - - -

MASON CJ: But at the moment I do not quite follow where you

get these limitations out of section 28.	You did
refer to subsections (2) and (3) - - -

MR HUGHES:	And subsection (7).
MASON CJ:	And subsection (7), but what do you precisely get out of (2) and (3)?
MR HUGHES:	We get out of (2) and (3) that, particularly in

the context of this case, (2), this concept, that
the limits of relevant, or boundaries of relevance,
are set by the statutory notice that the recipient

of a summons is entitled to get, presumably for the

purpose of enabling that person to consider his
position in relation to the summons and to see

whether, for example, he should object to it as

being invalid, as was done in this case, it was so

argued in the Court of Appeal or whether - - -

MASON CJ:	I can understand that you get out of it the notion that the Authority is bound to bring to the
attention of the person to whom the summons is directed the investigation and the boundaries
let me put it this way - the boundaries of the reference, but how do you take the next step, that
it necessarily imports a limitation by reference to
your doctrine of relevance?

MR HUGHES: Well, I asked the Court to look at section 29.

MASON CJ: But is the trouble not that 29 seems to be in a

different category. I have the impression from

18   12/3/92

section 28(7) that 28 is, as it were, a particular

provision, conferring powers that can only be

exercised in what might be described as special

investigations, and that immediately distinguishes

28 from 29.

MR HUGHES:  Yes. But the 29 power can also be used in

special investigations and whether or not a hearing

is taking place.

MASON CJ: Yes, I follow that, but does it not rather

suggest that 28 is conferring special powers that

are, as it were, directed solely to special

investigations and, if so, why are you importing

something from 29?

MR HUGHES:  Only to illustrate the legislative policy

applicable to the operation of section 29 and to

ask the question, is there any reason why, in the
case of a special investigation, which is probably

the most serious form of inquiry that the Authority

can hold, there is any reason to suppose that the

rule of relevance should be different and we say,

no, because the confinement of the use of the

summons to the purposes of the special

investigation necessarily involves a confinement of

the use of the summons to the particular matters

that are to be found in the statutory notice under

subsection (2).

That is the route by which we seek to travel,

and, Your Honours, it is a short point. I am

afraid I have taken rather longer than I should

have to expose it and once exposed it either

appeals or it does not. We submit it is clearly an

arguable point and it is a point which does affect,

in a very real way and likely to be not

infrequently, the extent of the Authority's

statutory powers in relation to the use of the

summons provided for in section 28.

Now, Your Honours have probably had an

opportunity at this stage to look at the rest of

the outline.

MASON CJ: Yes, I think we have.

MR HUGHES: Well, Your Honour, I doubt if I can usefully add

to the criticisms that we venture respectfully to

level at the judgments of the primary judge and in

the Full Court and that is the point. If it is

arguable, it is of general application and I have

submitted why we say it is so. Now I can deal with

the other matter - the time question very briefly.

MASON CJ:  I do not think there is any occasion to deal with

that at the moment. If you have concluded your

19   12/3/92

argument on the point of substance, then I think

the Court will take the opportunity of determining

what course it will take in relation to the matter

at this stage and, if need be, we can call upon you

on that question, or perhaps even call upon

Mr Weinberg at this stage.

MR HUGHES: If Your Honour pleases.

MASON CJ:  So we will take a short adjournment.

AT 4.45 PM SHORT ADJOURNMENT

UPON RESUMING AT 4.50 PM:

MASON CJ:  The Court need not trouble you, Mr Weinberg. The

Court is not persuaded that the actual decision of

the Full Court of the Federal Court is attended

with sufficient doubt to justify the grant of

special leave to appeal.	The application is
therefore refused.

MR WEINBERG:  If the Court pleases, we seek an order for

costs.

MASON CJ: Yes. You do not oppose that, Mr Hughes?

MR HUGHES:	I cannot saying anything about that.
MASON CJ: The application is refused with costs.	Yes,

Mr Hughes?

MF HUGHES:  There is one problem. Now that that decision

has been reached there is an application I can make

very shortly.	The documents are on the Court file
and while they are there is a rule which entitles
anyone to read them.	I doubt if this will be

opposed by my learned friend, because I think both

parties see that this is a matter that requires, so

far as possible, the strictest confidence. The

order I would ask the Court to make is that we have

liberty to remove the documents from the Court

file.

MASON CJ:  Now, that is the documents that are the subject

of the summonses?

MR HUGHES:  Yes, in other words, the application book, with

all the material in it which reveals identities.

20   12/3/92

MASON CJ: Well, I think there is a difficulty about

removing from the Court files the actual documents

that constitute the proceedings in the Court.

MR HUGHES: Well, if that is - - -

MASON CJ:  Mr Hughes, it seems to us that it is not a

matter, as it were, of lifting the Court files, but

perhaps you are seeking an order against

publication - - -

MR HUGHES:  Yes, or inspection.

MASON CJ: Well, first of all, of the names of the corporate

entities involved?

MR HUGHES: Yes, Your Honour. Yes, we would seek that - - -

MASON CJ:	Now, first of all, as to that, what else would you see~?
MR HUGHES:	The other form of order I would seek is an

order, and I must say there seems to be a

difficulty about this which I should expose - an

order preventing inspection by any member of the

public of the Court file - that is the application

book - the document file - - -

MASON CJ: Well that again is a difficulty, is it not?

MR HUGHES:  Yes, it is, because there does not seem to be

any provision in the rules by which the Court can

waive the operation of a particular rule.

DAWSON J: It might be an inherent jurisdiction, but the

names of the entities have formed no part of these

proceedings before us, there is nothing to publish

at the moment.

MR HUGHES:_ No, they have not.

DAWSON J:  Why would it not be sufficient if time were given

to black out the names on the Court file?

MR HUGHES:	Yes, that would be sufficient.
DAWSON J:	And until such time as that is done, give a

limited time, that they are not to be released for

inspection.

MR HUGHES: Well, I would be obliged if that order were

made, that will meet the - - -

DAWSON J: That is only my suggestion, it is not -

MR HUGHES:  Yes. That will meet the exigencies of the case.

21   12/3/92

MASON CJ:  I do not think there would be any objection on

the part of the Court to making those orders.

Mr Weinberg, what do you say about that?

MR WEINBERG:	We would have no objection to that.
MASON CJ:	You would have no objection.
MR WEINBERG:	Then may we bring in short minutes at some

convenient time soon, tomorrow?

MASON CJ: Yes, but meantime I shall say that the Court

files will not be available for inspection say,

until further order, which is expected to be made

tomorrow, so that if you could bring in short

minutes at 9.30 am tomorrow we can deal with the

matter then.

MR HUGHES:  Yes. I am obliged. Would Your Honours please

pardon my absence; my junior will attend to that?

MASON CJ: Yes. Court will now adjourn until 9.30 am

tomorrow.

AT 4.55 PM THE MATTER WAS ADJOURNED

UNTIL FRIDAY, 13 MARCH 1992

22 12/3/92