Legal Research
Cases
Morgan v Babcock & Wilcox Ltd

Morgan v Babcock & Wilcox Ltd

Link copied

Case Copied 16 October 1929 37 min read

Contents

On this page

43 CLR 163

BABCOCK AND WILCOX LIMITED

RESPONDENT. DEFENDANT,

ON APPEAL FROM THE SUPREME COURT OF

NEW SOUTH WALES. Evidence-Proof of offence-Confidential communication from representative of

company to managing director-Admissibility of secondary evidence--Notice to company-Notice to managing director - Ostensible authority - Offence com- mitted within the jurisdiction - Proceedings - Commencement - Statutory limitations of time-Onus of proof-Secret Commissions Prohibition Act 1919 (N.S.W.) (No. 26 of 1919), secs. 3, 14 (2), (3), (4)*-Justices Act 1902-1918 (N.S.W.) (No. 27 of 1902-No. 32 of 1918), secs. 20, 145A.

A., the attorney and general manager in Australia of an English company carrying on business in New South Wales, was, early in 1926, told by M., an employee of the Sydney Municipal Council, that the sum of £10,000 would have to be paid by the company if it wanted a favourable report on and the acceptance of a certain tender. A. replied that he would have to recommend to his managing director or directors to pay the blackmail. The company's tender was accepted, and after the contract was signed A. informed M. that the * The Secret Commissions Prohibition

contravention of any of the provisions Act 1919 (N.S.W.) provides, by sec. 14,

of this Act shall be on the accused. as follows :- (2) If in any prosecution

(3) No prosecution under this Act shall under this Act it is proved that any

be commenced after the expiration of valuable consideration has been received

two years from the commission of the or solicited by an agent from or given

offence charged, or six months from the or offered to an agent by any person

first discovery thereof by the principal having business relations with the

or the person advised, as the case may principal, without the assent of the

be, whichever expiration first happens. principal, the burden of proving that

(4) No prosecution under this Act shall such valuable consideration was not

be commenced without the consent of received, solicited, given, or offered in

the Attorney-General."

43 CLR 164

latter would have to nominate somebody to receive the payment, and that he (A.) would have to pass the name on to the managing director of the company, who, no doubt, would pay it. M. arranged that the money should be paid into the account of B. at a specified bank in Sydney. M. informed A. of this arrangement, and also told him that he would want £600 more for expenses. At the end of July or the beginning of August 1926 A. wrote to the managing director of the company at its head office, in London, a confidential letter giving reasons for the payment of the money, and furnishing him with the name of B. and B.'s bank. A. also stated that payment to B. would be a sufficient discharge, This letter, which was in manuscript, was not recorded on the company's files n Sydney. On 7th September 1926 B.'s account with the bank in Sydney was credited with the sum…

Grounds of appeal

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

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

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

Consideration

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

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

Keep reading for free

Create a free CaseChat account to read Morgan v Babcock & Wilcox Ltd and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [1929] HCA 25
Decision Date: 16 October 1929

CaseChat Overview and Summary

The case of *Morgan v Babcock & Wilcox Ltd* involved an appeal to the High Court of Australia from a decision of the Supreme Court of New South Wales. The appellant, William Morgan, a detective sergeant, had prosecuted Babcock & Wilcox Ltd. (the respondent company) for corruptly giving a sum of £10,600 to Silas Young Maling, an agent of the Municipal Council of Sydney. The alleged offence was that the payment was a reward for Maling recommending the company's tender for the Bunnerong Power Station plant. The prosecution was initiated on 11th July 1928, and the company was convicted by a magistrate. However, the Supreme Court of New South Wales subsequently made absolute a rule nisi for a writ of prohibition, quashing the conviction.

The legal issues before the High Court included whether secondary evidence of a confidential letter from the company's Australian attorney and general manager, Arnot, to the company's managing director in London, Sir James Kemnal, was admissible. The court also had to determine if there was sufficient evidence to establish that the offence was committed within the jurisdiction of New South Wales, and whether the prosecution had been commenced within the time limits prescribed by the *Secret Commissions Prohibition Act 1919* (N.S.W.). A further issue was whether the company was criminally responsible for the actions of its managing director in authorising or causing the payment of the bribe.

The High Court, by a majority (Knox C.J., Isaacs and Dixon JJ., with Starke J. dissenting), held that the conviction should be upheld. The majority reasoned that secondary evidence of Arnot's letter was rightly admitted because the letter, though confidential, was sent to the managing director in his capacity as the appropriate recipient for such communications on behalf of the company, and therefore the company had a right to call for it. The circumstances, including the timing and amount of the payment into a nominated Sydney bank account, provided prima facie evidence that the money had been paid by the company to Maling. The court found that the offence was completed within the jurisdiction when the money was credited to the Sydney bank account, even though the instruction to pay may have originated in London. Regarding the statutory limitations, the majority interpreted section 14(3) of the *Secret Commissions Prohibition Act 1919* to mean that the burden of proving the prosecution was not commenced within six months of the offence's discovery lay with the defendant.

Consequently, the High Court allowed the appeal, discharged the rule nisi granted by the Supreme Court, and restored the conviction of Babcock & Wilcox Ltd. The majority found that the evidence, including the admitted secondary evidence of the letter and the circumstantial evidence surrounding the payment, was sufficient to support the conviction. Starke J., in dissent, expressed the view that the case relied heavily on Maling's credibility and that corroboration would have been prudent, suggesting a preference for upholding the Supreme Court's reversal of the conviction.

Orders