Paterson v MacPherson; Zacharakis v MacPherson (No 2)

[2011] SASCFC 59

SUPREME COURT OF SOUTH AUSTRALIA

(Full Court: Application for Judicial Review)

PATERSON & ORS v MACPHERSON & ANOR; ZACHARAKIS v MACPHERSON & ANOR (No 2)

[2011] SASCFC 59

Reasons for Ruling of The Full Court

(The Honourable Chief Justice Doyle, The Honourable Justice White and The Honourable Justice Peek)

28 June 2011

ADMINISTRATIVE LAW - JUDICIAL REVIEW - PROCEDURE AND EVIDENCE - COSTS

Consideration of orders to be made - orders as to costs.

Local Government Act 1999 (SA) s 6(a), s 132A, s 272(3), s 272(3)(d); Evidence Act 1929 (SA) s 69AB, referred to.
Paterson & Ors v MacPherson & Ors [2010] SASC 311; Paterson & Ors v MacPherson & Anor; Zacharakis v MacPherson & Anor [2011] SASCFC 49, considered.

PATERSON & ORS v MACPHERSON & ANOR; ZACHARAKIS v MACPHERSON & ANOR (No 2)
[2011] SASCFC 59

Full Court:      Doyle CJ, White and Peek JJ

1. THE COURT:          These are the Court’s reasons for the orders that it makes in each of the actions before it. 

2. The reasons are to be read with the reasons of Doyle CJ, with whom Peek J agreed, in Paterson & Ors v MacPherson & Ors; Zacharakis v MacPherson & Anor [2011] SASCFC 49. Those reasons are the majority reasons.

3. The Court has considered written submissions by the parties relating to the orders to be made to give effect to the majority reasons.

   Validity of Terms of Reference

4. In each action the Court makes the following order:

   The Court declares:

   1.That the second defendant’s Notice of Appointment of the first defendant dated 22 July 2009 and the Terms of Reference set out therein are invalid to the extent that:

   1.1    The Notice of Appointment and the Terms of Reference direct an investigation into whether the Council of the City of Burnside has contravened or failed to comply with provisions of the Local Government Act 1999 (SA) (the Act) other than s 6(a) and s 132A.

   1.2    The Terms of Reference include the second and fifth dot points in paragraph (1) and the whole of paragraph (4).

5. The parties agree that the Court should make the order set out in para 1.2.  The plaintiffs argue for, and the defendants oppose, the making of the order set out in para 1.1.  The Court considers that the order in para 1.1 accurately reflects the reasons of Doyle CJ at [78]-[81] in the earlier reasons.  While the making of the order in para 1.1 might not be essential, the Court considers that the order will provide useful guidance to the parties and to the public and others with an interest in the proceedings.

   Documents produced and questions answered under s 272(3) of the Act

6. The plaintiffs claim an order declaring invalid Notices issued by Mr MacPherson, relying on s 272(3) of the Act. One such Notice required each plaintiff to produce documents relating to the Terms of Reference. The other Notice required each plaintiff to answer questions “associated with” the Terms of Reference.

7. The plaintiffs also claim an order that Mr MacPherson return to each plaintiff documents produced by the particular plaintiff and the record of any questioning of the particular plaintiff.

8. These proposed orders present a difficulty.  The difficulty arises from the fact that the plaintiffs did not institute their proceedings until September 2010, almost 14 months after Mr MacPherson was appointed.  Mr MacPherson’s inquiry is well advanced.  He and those assisting him will have considered already the documents produced by each plaintiff and answers given by each plaintiff.  It is now too late to return things to where they were at the start of the inquiry, or even when the Notices were first issued.

9. Ordinarily, the partial invalidity of the Terms of Reference would cause the Court to declare the Notices to be invalid.  That would leave Mr MacPherson at liberty to issue fresh Notices.  Usually that would be the convenient way to proceed. 

10. Even though the Terms of Reference are invalid in part, Mr MacPherson had power to require each of the plaintiffs to produce documents relevant to the Terms of Reference as limited by the Court.  He had power to require each of the plaintiffs to answer questions relevant to the Terms of Reference as limited by the Court.   But the Notices are expressed more widely than they should be, because they invoke the whole of the Terms of Reference.  Mr MacPherson probably holds documents to which he is not entitled, and probably has answers to questions that went beyond his powers.  It is not practicable for the Court to comb through the documents and the transcript to identify what is within power and what is beyond power. 

11. If the Court were to make the orders claimed by the plaintiffs, Mr MacPherson could issue fresh Notices and start again, but now on a narrower basis.  To require that to be done seems inefficient.

12. If Mr MacPherson began afresh the plaintiffs might challenge Mr MacPherson’s power to begin afresh, and might argue that he should not be permitted to proceed in this way, having regard to the knowledge he may have acquired as a result of his inquiry going beyond the Terms of Reference as limited by this Court.  We make no comment on the prospect of that submission succeeding.

13. If we decline to make the orders claimed, the position remains the same. Mr MacPherson should confine his inquiry and report henceforth to matters within the Terms of Reference as limited by the Court. In due course, any documents produced to him must be returned to the person entitled to them: s 272(3)(d) of the Act.

14. The plaintiffs might challenge Mr MacPherson completing his report, relying on the argument alluded to above. 

15. So, however one looks at it, there is a real practical problem.          

16. It is in the public interest that Mr MacPherson complete his inquiry, and report to the Minister, as soon as practicable, on matters within the scope of the Terms of Reference as limited by the Court.  The difficulties confronting him in doing so will have to be dealt with, if and when they arise.  The orders claimed by the plaintiffs do not prevent him from reporting to the Minister, if he can do so relying on material on which he is entitled to rely. 

17. The legal and practical problems that now arise are attributable to the fact that the plaintiffs brought the proceedings late in the piece.  The challenge to the Terms of Reference could have been made at any time from the appointment of Mr MacPherson. 

18. In these circumstances, we consider that the public interest in Mr MacPherson completing his inquiry and reporting to the Minister, if he is able to do so, should prevail.

19. We decline to make the orders claimed by the plaintiff, on the basis that to do so will give rise to further complications.  Mr MacPherson should now complete his inquiry and report to the Minister as soon as practicable.

20. We appreciate the difficulties that will arise.  As the reasons of Doyle CJ in the earlier reasons indicate, the authorised inquiry is narrower than the inquiry on which Mr MacPherson embarked.  Separating the material to which Mr MacPherson should have no regard from the material to which he is entitled to have regard will not be easy.  But it may be that if the inquiry and report are limited, as they should be, to the conduct of the Council, the findings to which the plaintiffs object no longer need be made.  Be that as it may, the next step is up to Mr MacPherson. 

    Costs

21. The plaintiffs have had a substantial success although they have not succeeded on some matters argued before the Court.  The Terms of Reference would have been wholly invalid had the majority not been prepared to read down the Terms of Reference to limit their reach.  The difficulties that have arisen are attributable in part to the Terms of Reference not being prepared with the care and attention to their scope that they deserved.  This is not a situation to which the plaintiffs have contributed. 

22. In the action first commenced by five of the plaintiffs, we order that the defendants pay the costs of the plaintiffs.  We do not consider it appropriate to reduce those costs having regard to issues on which they failed. 

23. We consider that there was no need for Mr Zacharakis to institute separate proceedings, or at least to be separately represented before the Court on the argument of the case.  We consider it appropriate to order that the defendants pay Mr Zacharakis 20 per cent of his costs of the proceedings, but those costs are not to include the costs of his application filed on 25 October 2010 (FDN 10).  As to that, see the reasons of White J in Paterson & Ors v MacPherson & Ors [2010] SASC 311 at [14].

    Suppression orders

24. Section 69AB of the Evidence Act 1929 (SA) requires the Court to review any suppression orders made in the actions before it.

25. On that review, representatives of the media and certain other persons are entitled to be heard.  The Court will hear the parties and any other persons with an entitlement to be heard, and will then make orders in relation to the suppression orders.  The relevant suppression order in Action No 1238 of 2010, the action in which there are five plaintiffs, was made on 26 October 2010.  It prohibits the publication of any part of the provisional draft report prepared by Mr MacPherson, or any account or report of that Report. 

26. In Action No. 1260 of 2010, in which Mr Zacharakis is plaintiff, the suppression order made in the other action appears to have been treated as sufficient.

27. As well, on 14 September 2010 an order was made that Exhibit FDN 4A, being Exhibit GMG1 to the affidavit of Gregory Griffin sworn on 13 September 2010, be kept in a sealed envelope not to be opened other than by direction of a Judge or Master.

28. We will hear the parties on the question of whether it is necessary to deal with that order separately, or whether it suffices for us to review and reconsider the suppression order already referred to.