TLC Consulting Services Pty Ltd v White

[2003] HCATrans 796

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Brisbane  No B14 of 2003

B e t w e e n -

TLC CONSULTING SERVICES PTY LIMITED

Applicant

and

PAUL MICHAEL WHITE

Respondent

Application for special leave to appeal

GLEESON CJ
CALLINAN J

TRANSCRIPT OF PROCEEDINGS

AT BRISBANE ON WEDNESDAY, 25 JUNE 2003, AT 10.16 AM

Copyright in the High Court of Australia

MR R. RICHTER, QC:  If the Court pleases, I appear with my learned friend, MR M.O. PLUNKETT, for the applicant.  (instructed by Tanya Cirkovic & Associates)

MR M.J. GRIFFIN, SC:   May it please the Court, I appear with MR B.J. THOMAS, for the respondent.  (instructed by Crown Law)

GLEESON CJ:   Yes, Mr Richter.

MR RICHTER:   If the Court pleases, the Court has our outline of submissions upon which we rely.  There is one matter that needs to be clarified, and it is the reference to the Privacy Act (Cth) in the context - it was initially put in as a matter of an excess of caution. There are no provisions which make that Act applicable in the context of invoking any inconsistency argument or anything of the kind. Its sole relevance to the argument is the recognition of privacy ‑ ‑ ‑

GLEESON CJ:   I was going to ask you, what exactly are the provisions of the Privacy Act (Cth) that are said to be inconsistent with the Queensland legislation? It is just a bias, is it?

MR RICHTER:   I am sorry ‑ ‑ ‑

CALLINAN J:   I think I said…..I have to take the blame.

MR RICHTER:   Yes, I think his Honour Justice Callinan gave us some assistance.  We did some research and, having done the research, I came to the conclusion that it was not tenable.

CALLINAN J:   I never said it was ‑ ‑ ‑

MR RICHTER:   No.  No, I took your Honour’s suggestion very seriously, looked at it at the time, the papers went in quickly.

GLEESON CJ:   Well, it is really a question of the correctness of the decision of the Court of Appeal, is it not?

MR RICHTER:   It is a question of the correctness of the decision of the Court of Appeal but it is also an issue of procedural fairness and natural justice in what the Court of Appeal did, which is of greater significance, in my respectful submission, as to the correctness of what the Court of Appeal determined in relation to the interpretation of the word “records”.

GLEESON CJ:   What is the natural justice point?

MR RICHTER:   The natural justice point is this.  This was actually an application to her Honour Justice Mullins for a statutory order of review.  The application is set out in page 1 of the application book.  There are quite a number of grounds traversed there, a significant number of grounds that were traversed.  During the course of the trial of the application a significant number of other matters arose, including, in the affidavit material, the demonstration that on the server hard drive material existed that was subject to legal professional privilege, material existed that was not in any way related to the running of the business of the introduction agency – in other words it related for example to the conduct of a restaurant and so on – and there were some 20,000 records relating to clients.

Now, when the inspector came, having executed the warrant and sought to take the server, it was demonstrated or told to him – and there is no dispute about this – he asserted that he was investigating 39 complaints and handed over a list of the 39 complainants.  It was pointed out to him ‑ ‑ ‑

GLEESON CJ:   Just before you go any further.  Does that mean that on the language of the legislation, what he was entitled to was the records relating to those 39 complaints?

MR RICHTER:   That is what we say.

GLEESON CJ:   What did the Court of Appeal say about that?

MR RICHTER:   The Court of Appeal said that the whole server was a record.

GLEESON CJ:   I understand that.  Put to one side the complication that arises out of the way these records were kept.  If there had been a filing cabinet with an individual file for each client, what would they have been entitled to on the reasoning of the Court of Appeal, 39 files or the whole filing cabinet?

MR RICHTER:   The whole filing cabinet.  That was the point that we sought to adumbrate in front of the Court of Appeal.  The hearing was very, very short.  On the finding of the definition of “record”, what the Court of Appeal did was, in fact, to say, “It is a record, so it is seizable”, end of story.  At the end of a very short argument we said ‑ ‑ ‑

GLEESON CJ:   There is a problem, is there not?  You said, “It is a record, so it is seizable”.

MR RICHTER:   Yes.

GLEESON CJ:   Well, the emphasis is on the word “it”.

MR RICHTER:   Yes.

GLEESON CJ:   There was only one thing.

MR RICHTER:   A server.

GLEESON CJ:   You could not seize part of the server, could you?

MR RICHTER:   Yes, you could.  You could seize the hard drive, for example.  The server itself is not a record.  The machinery itself is not a ‑ ‑ ‑

GLEESON CJ:   What could you have seized that would have given the raiding party information only in relation to the 39 complaints?

MR RICHTER:   You could have seized that which was offered, which was, “We will print out all the records for the 39 complainants.”

GLEESON CJ:   No, I am not sure that is an answer to my question.  People who execute warrants of this kind do not have to leave themselves in the hands of people such as your clients about compliance with the warrant, do they?

MR RICHTER:   I appreciate that.  They can conduct a negative search, for example, and one of the aspects that we want to agitate in this appeal is what happens in these technologically‑advanced days when you are going to look at a computer server which is the repository of the whole business.

GLEESON CJ:   I understand that, but we are talking about seizure.

MR RICHTER:   Yes.

GLEESON CJ:   I would like to just put to one side possible co‑operation, because there are people who are not very co‑operative; there are people upon whose co‑operation you cannot absolutely rely.

MR RICHTER:   It is not just co‑operation.

GLEESON CJ:   So I am interested in the concept of seizure.

MR RICHTER:   Yes.

GLEESON CJ:   What could they have seized less than what they did seize?

MR RICHTER:   What they could have seized was the actual records in which they were interested in and they could have done it – and we would say that this is a matter of general importance when searching computers.  They, knowing they were going to search one, should have brought someone who was computer competent and literate who could have conducted a negative search on the hard drive to eliminate that which they do not want, and could have then printed out the material.  The Act gives the power to do that.  What the Act does is to give the power to search ‑ ‑ ‑

GLEESON CJ:   Where do we most conveniently find the legislation, Mr Richter?

MR RICHTER:   I thought that ‑ ‑ ‑

CALLINAN J:   Mr Richter, could I just ask you a question.  If they seize the hard drive, it would tell them nothing unless and until they printed out matter from it.  You cannot read on the hard drive.

MR RICHTER:   That is right.  Well, you can read it on the screen.

CALLINAN J:   You can read it on the screen, yes, but there has to be some further act done in relation to the hard drive to make it of any utility at all.

MR RICHTER:   That is right.

GLEESON CJ:   Where do we see the statutory identification of what they are entitled to seize?

MR RICHTER:   Section 89, if the Court pleases.  Section 89 is reproduced in the judgment of her Honour Justice Mullins.

CALLINAN J:   Section 89?  It is at 25 and 26, is it not?

MR RICHTER:   Yes.  The full section is not reproduced ‑ ‑ ‑

GLEESON CJ:   I would like to cast my eyes on the full section.

MR RICHTER:   Certainly.

GLEESON CJ:   I would really like to see what the statute identifies as that which they are entitled to seize.

MR RICHTER:   Yes, the full section is set out in her Honour Justice Mullins’ judgment at pages 8, 9 and over to 10.  The relevant provision is in paragraph (e), which gives the powers.  That is at page 9 line 17.

GLEESON CJ:   Well, section 89 provides the inspector may:

(e)  in any premises entered by the inspector ‑

seize what?

MR RICHTER:  

(i)  search for, examine, take possession of or make copies of or extracts from records relating to goods or services ‑ ‑ ‑

GLEESON CJ:   What is he entitled to seize?

MR RICHTER:   He is entitled to seize that which is relevant to his purposes.  It is subject to that implied limitation.

GLEESON CJ:   Is it subparagraph (iv)?

MR RICHTER:   In subsection (4) he is entitled to exercise all his powers.  In subparagraph (iv):

seize without payment any brochures, leaflets, books, writings, documents or other materials that the inspector knows or reasonably suspects have been, are being, or are likely to be used to advertise, promote or make representations ‑ ‑ ‑

GLEESON CJ:   Is that the provision with which we are concerned?

MR RICHTER:   No, your Honour.  We are actually concerned with subparagraph (i) of (e):

Search for, examine, take possession of or make copies of or extracts ‑ ‑ ‑

GLEESON CJ:   Yes, “take possession of”.  So he can please himself which of those things he does.  He does not have to do whichever is more convenient to the person who is being searched.

MR RICHTER:   Subject to acting reasonably.

GLEESON CJ:   Yes.

MR RICHTER:   Which is an implicit limitation on the executive power.

GLEESON CJ:   Well, what constitutes reasonable conduct on the part of somebody who is investigating a possible crime might be different from what constitutes reasonable conduct on behalf of somebody attending a settlement of a conveyancing transaction.

MR RICHTER:   Yes, but that is, indeed, a matter for weighing up, and it was a matter for weighing up for her Honour at the review stage.

GLEESON CJ:   But let us just look at the words of the statute.  His power is in any premises that he enters to:

take possession of . . . records relating to goods or services . . . or relating to any matter the subject of an investigation under this Act –

is that right?

MR RICHTER:   That is right, yes.  So he has no power to take things that do not, hence the ‑ ‑ ‑

GLEESON CJ:   Well, that is why I am asking you - forget about him being nice or about him being co‑operative.

MR RICHTER:   I assume he is not.

GLEESON CJ:   We are dealing with people whom he suspects of committing criminal offences.

MR RICHTER:   Yes.

GLEESON CJ:   What could he have taken possession of less than what he did?

MR RICHTER:   He could have taken possession of those records that related to the goods and services and to the subject matter of his investigation.  In other words, it is the filing cabinet analogy.  He had the means and ability to go through the filing cabinet without taking the whole kit and caboodle, the whole filing cabinet, which is what he did.  He took the filing cabinet, not the files, and he had the ability to look for the files and to isolate the files that he wanted, and they would have been the ones that he should have had.  The vice of doing anything else is the vice that occurred in this instance, that, for example, what he was taking was – he was taking the whole business.  The business could not function without this at the time of taking.

On the hard drive were entries relating to 20,000 or so people who did not make complaints, whose privacy was sacrosanct and ought to have been protected, at least contractually, by the occupier and in other ways by the law.  He took away correspondence between the tax office and the entity.  He took away correspondence with solicitors, which was the subject of legal professional privilege.

GLEESON CJ:   More accurately, he took away a chattel which was being used in a way that stored information in relation to all those matters, but he only took away one chattel, did he not?

MR RICHTER:   Yes, but that was the chattel that stored the whole of the information.

GLEESON CJ:   I understand that.

MR RICHTER:   Yes, he took away one chattel.

GLEESON CJ:   But by the language of the statute there was only one chattel which he seized.

MR RICHTER:   No, he actually seized some hard copy files relating to some of those 39 ‑ ‑ ‑

GLEESON CJ:   Yes, but relevantly to our – he seized a single chattel.

MR RICHTER:   Yes, relevantly – correct.

GLEESON CJ:   And took it away.

MR RICHTER:   Yes.  He took it away without – what we say is that the scheme of the Act requires him to act reasonably, of course, but it also requires him to search on the premises, to make some search and to make some determinations of what he is going to take away, because the way (i) is expressed, it says:

search for, examine, take possession of or make copies of or extracts from records relating to goods or services ‑

et cetera.  So there is a process to be gone through.  He can do a negative search to find out what it is that he actually wants and once he has decided that there are matters to which he is not entitled, he can take the ones to which he is entitled.

GLEESON CJ:   What is the difference, if any, between taking possession of something and seizing something?

MR RICHTER:   Well, none.

GLEESON CJ:   Is it common ground that the power to take possession of something comprehends a power to take it away from the premises?

MR RICHTER:   Yes, it must do.  What I was going to go to is there is a genuine disagreement as to the construction of “records”, as to whether, in fact, a hard drive on a server is a repository of a large number of records, separate and discrete records, some of which they are entitled to, some of which they are not, and it has to do with the impact of technological change on the way information is stored.  That being so, the whole notion of a negative search eliminating that to which you are not entitled must be implicit in the exercise of powers by the inspector.  He does not have to be nice but he has to be reasonable.  Where it appears, as was clear at the time, that there are records there to which he is not entitled – this is not the case of saying, “I want to go into the library and I want volume 189 of the Commonwealth Law Reports and I’ll take the whole lot because it puts it in context.”  These are discrete items.

Now, the whole matter was litigated in front of Justice Mullins who took a certain view, saying the server is not a record.  It was a tenable view, just as tenable as the view that was taken by the Court of Appeal, in my respectful submission, on their interpretation of the word “documents”, using the Interpretation Legislation Act.  It was just as tenable, but what happened – which is the root of the real complaint of lack of procedural fairness and natural justice – is this, that when the Court of Appeal in a very peremptory judgment, in fact, came to overturn her and ordered the return of the server to the inspector, it had completely overlooked and had to be reminded of the fact that there were items with respect to which there was legal professional privilege claimed.

What the Court of Appeal did, which is shown at the end of its judgment, almost as an afterthought, was to make an order which, in our respectful submission, is simply not a proper order.  What it said in relation to it was that effectively if the inspectors were looking through the hard drive, found that there was something that they might think was entitled to the protection of legal professional privilege – and this is at page 32:

There will be an order that if, in the course of examining the mirror copy of the hard drive of the server the relevant officers of the appellant identify a document to which legal professional privilege could reasonably be considered to apply, those officers will not further examine the document.

This was in the context of saying, “We’d like a stay because we’ve argued legal professional privilege.  What are we going to do about legal professional privilege?”  So we got that, which we would say is an egregious error.

You cannot have a situation in which the person seeking is made the arbiter of whether or not there is legal professional privilege.  The vice in what the Court of Appeal did – and it did it very quickly and did it very peremptorily, without having regard to any of the arguments that arose on the review application.  Certainly Justice Mullins narrowed down the confines of the argument because it was easy to dispose of it by taking the statutory construction position.  That was not the end of it.  If the Court of Appeal thought that she was wrong on her statutory construction, it should have remitted the matter to her to make a proper determination as a review of an administrative decision, and it did not.  It made no decision as to the review of the administrative decision itself, instead of which it ordered the return of the server.  So that was, in our respectful submission, an egregious failure to accord natural justice and a procedural unfairness which constitutes an injustice. 

There are a number of special leave issues that arise.  One of them that was argued, for example, was that the keyhole‑type warrant issued, the Rossminster‑type warrant issued, and whether or not that is subject to any limitations, implied or otherwise, in relation to the exercise of power because there have been some comments, and they are set out in our outline of submissions in relation to the potential problems with the Rossminster approach, which the Court of Appeal endorsed.  It is not subject to the provision or notification of any particular power, for example, of the legislation which is sought to be invoked. 

The particular warrant here said, “Go and use all the powers you’ve got under the Act”.  The fact is they were not going to use all the powers they had under the Act.  The powers they were going to use were limited to what they told the people at TLC, namely they were involved in an investigation of 39 complaints.  Later on it emerged that they were contemplating the possibility of injunctive proceedings that perhaps might have taken them to ‑ ‑ ‑

GLEESON CJ:   I do not understand where your draft notice of appeal raises what you described as the “procedure or natural justice point”.

MR RICHTER:   Well, it does not in terms, but it underlies the whole issue.

GLEESON CJ:   It might underlie it, but there is simply no ground of appeal in the draft notice of appeal covering that matter.

MR RICHTER:   Yes.  There is no specific ground.  To that extent we would be seeking to add that, your Honour.  It is something with which ‑ ‑ ‑

GLEESON CJ:   Well, would you mind formulating it now so that we know exactly what it is in respect of which you seek leave?

MR RICHTER:   Certainly.  The formulation, if I can do it immediately, is that the Court of Appeal erred in ordering the return of the server, rather than remitting the matter to her Honour Justice Mullins to consider the other grounds for seeking judicial review of the decision.  That is the ground that I would be seeking to add.  But, as I say, there are other issues of general importance.  I know this legislation is limited to Queensland and the closest to it is Tasmanian, but the notion of the seizure of servers and the impact of technology in this sort of area is something of general application, and in that way, in my respectful submission, it is quite central to the administration of justice when executing warrants of all kinds as to reasonableness of conduct, as to protection for privacy. 

It is in this context that increasing recognition of privacy rights are significant and in the context of technological change as to whether or not a computer server is to be regarded as a compendium of discrete records or as just a physical item.  These are matters that raise issues of general importance to the administration of the law in Australia.  If the Court pleases.

GLEESON CJ:   Just one small matter.  What is happening in relation to the progress of this matter at the present time?  Has it been accommodated by the interlocutory order that was made by Justice Callinan?

MR RICHTER:   It was.  Justice Callinan ordered a stay on the return of the server, and it is stayed.  So we would be seeking a further stay until the determination.

GLEESON CJ:   What is happening about the process of the investigation of the fraudulent practices alleged to have been engaged in by your client?

MR RICHTER:   I do not know about any further investigation, but what I do know is that there has apparently been some civil settlement between TLC and the Office of Fair Trading in relation to these matters.  Now, whether they proceed or not, I do not know.

GLEESON CJ:   Has the Office of Fair Trading now got the records, or the information?

MR RICHTER:   No.  No, they are still subject to the stay order that his Honour Justice Callinan made.

CALLINAN J:   What about the 39 files?  Where are they?  They have been printed out, have they not?

MR RICHTER:   No, some of them were printed – I see, yes, but by consensus there was a delivery of certain numbers of files, and I believe the 39 files were delivered.  There was a process whereby the two sides got together in order to ‑ ‑ ‑

CALLINAN J:   Files relating to the identified complaint are in the hands of the respondent ‑ ‑ ‑

MR RICHTER:   Yes, they are.

CALLINAN J:   ‑ ‑ ‑ who can undertake investigations as it deems fit.

MR RICHTER:   That is so, yes.

GLEESON CJ:   Thank you.  Yes, Mr Griffin.

MR GRIFFIN:   Your Honours, the argument as it has been…..this morning by our learned friends highlights what, in our submission, is central to the argument and what really supports this Court’s view which we would submit is a refusal of special leave.  This is no more than a matter of statutory interpretation in relation to a particular aspect of powers of inspectors to obtain information pursuant to ‑ ‑ ‑

CALLINAN J:   That does not attract me as an argument at all, speaking entirely for myself.  It is either right or wrong.  The fact that it is a State statute and it relates to powers under the Fair Trading Act does not suggest to me that that is a basis for refusing special leave.  There may be other bases, but I do not find that an attractive argument.

MR GRIFFIN:   Your Honour, the argument from our point proceeds that it is simply a question of the Court of Appeal’s interpretation of ‑ ‑ ‑

CALLINAN J:   Yes, but if that decision stands, it gives access to 20,000 files containing a great deal of intimate detail about people who know nothing about this, who have entrusted that intimate information to the applicant and now it is in the hands of some authority.  …..in any way at all.

MR GRIFFIN:   Your Honour, that, of course, is so ‑ ‑ ‑

CALLINAN J:   To me that is an important matter.

MR GRIFFIN:   Yes.

CALLINAN J:   It is a different matter from whether the decision is right or not, but the underlying matter is an important one.

MR GRIFFIN:   Can I deal with some issues that have been raised by your Honour’s statement.  There is a requirement under the Act in section 110 for secrecy in respect of persons, including an inspector, such as the person who was involved in this matter.  That is secrecy in terms of the receipt of information and the manner with which it is dealt.

The 20,000 files that your Honour refers to is merely an index of the breadth of operation of that body, in respect of whom an inspector or the Office of Fair Trading were concerned to ensure that it should be stopped, if there was evidence, from trading in a way that affected consumers.  The legislation itself allows for wide and roving inquiries and contrary to what our learned friends submit were simply an interest in 39 complainants, it is clear from the statement made by her Honour Justice Mullins at paragraph [3], if I can take your Honours to that, what the real purpose of this investigation was.  It went beyond 39 people who at that time, at the time of the swearing of the affidavit upon which the warrant was based, went beyond that in terms of the Office of Fair Trading’s concern in respect of the operations of TLC.  At record 6 paragraph [3] your Honours will see:

The respondent deposed in his affidavit . . . to his investigations into the various activities of the applicant being directed towards the potential for prosecutions of breaches . . . and also with possible injunctive proceedings . . . and compensatory proceedings . . . The provisions of the FTA on which the respondent was considering that potential prosecutions or proceedings could be based were ss 38, 39, 40 and 48 of the FTA.

Sections 38, 39 and 40 are quite separate provisions which deal variously with the behaviour of a business.

CALLINAN J:   Mr Griffin, is the substance of the ratio of the decision of the Court of Appeal at page 29, starting about line 9, is that the substance of the decision in the Court of Appeal, in the reasons of the Chief Justice?  His Honour states the argument I think on the other side.

MR GRIFFIN:   I think your Honour is referring to page ‑ ‑ ‑

CALLINAN J:   Page 29, line 9.

MR GRIFFIN:   Yes, that is so.

CALLINAN J:   And you adopt that ‑ ‑ ‑

MR GRIFFIN:   Yes, we do.  The server, we submit, was a record.  The record is ‑ ‑ ‑

GLEESON CJ:   That also appears on page 27, line 29 to 40, does it not?

MR GRIFFIN:   Yes, your Honour, that is so.  A slightly different way of stating the same proposition.  Really, the question that was answered by the Court of Appeal is this.  The record is not the information.  It is the repository of the information; in this case the server, which contained the hard drive which contained the information.  That hard drive was indivisible.  Section 89 allowed, amongst other things, for possession to be taken ‑ ‑ ‑

CALLINAN J:   Can I ask you this, Mr Griffin, if in fact there was a hard copy of each of these 20,000 files, is it your submission that you would be entitled to all of those?  I just do not quite understand what your position is on this.

MR GRIFFIN:   Yes.  The answer is yes.

CALLINAN J:   Because you say they are appropriately the subject matter of the investigation, that if you get one complaint or five complaints, you are entitled to look at all the business dealings of the…..under investigation.

MR GRIFFIN:   That is so, because those provisions to which her Honour referred, 38, 39 and 40, for example, do not necessarily focus on a complainant and a single prosecution but deal, rather, with the course and conduct of a business.

CALLINAN J:   The Court of Appeal really did not decide that, did it?

MR GRIFFIN:   It is implicit in the Court of Appeal’s decision.

CALLINAN J:   I do not know.  You may be right.  I must say I did not read the decision that way.  I read it as turning simply upon the meaning of a “record” without really exploring the section at all.

MR GRIFFIN:   Not in any specific way, I accept that.  Your Honour, could I continue to answer the question that you asked about the 20,000 files.  In this case it was the position that there were 1,000 actual hard copy files, if I can call them that, the sort of things one might find in a filing cabinet in manila folders.  There was discrimination and discretion exercised in respect of those.  Of those 1,000 files, only 27 were taken.  So when one looks at the overall picture, as Mr Richter was attempting to press upon this Court, one does, indeed, see that there was discretion in the way in which the information being sought by the inspector was approached. 

Your Honour, those are the submissions in relation to the effect of the Act.  In respect of the submission concerning denial of natural justice, or the natural justice point, as it has been called ‑ ‑ ‑

GLEESON CJ:   It is really a submission concerning the form of the order that was made by the Court of Appeal, I think.

MR GRIFFIN:   Your Honour, the form of the order was, in our submission, one that comprehends a practical approach to the way in which an investigation is carried out when the investigator is faced, as he might have been at the premises, with 1,000 files and a decision to take 27.  There has to be a threshold point at which an inspector would make an assessment of whether the file is relevant and whether, if there appears to be privilege attaching to it, it is either discarded or there are discussions held with the person claiming privilege.

In this case it is said, and we contradict what is argued, there was no actual claim for privilege.  All that has been asserted is a very general and non‑specific statement that some of the documents are privileged.  The next step that should have been taken by the applicant and simply has not is that step where there is some specific identification of documents said to be privileged, and then the steps which progress from that are either agreement by the party taking possession of the records or, if there can be no agreement, the documents said to be privileged are preserved and a court makes a decision.

Your Honours, we rely on a statement made by Justice Mason, as he then was, in Baker v Campbell, to which we have referred, at page 83.  We have provided your Honours with copies of that.  His Honour said this in respect of that practical approach to the way in which documents should be assessed, seized and determinations made as to privilege, for Baker v Campbell was a case that itself was centrally concerned with the question of legal professional privilege.  His Honour said:

In approaching the scope of the authority given by the warrant we must keep practical considerations steadily in mind.  It is simply impossible for a police officer executing a warrant to make an instant judgment on the admissibility, probative value or privileged status of the documents which he may encounter in his search.  Generally speaking, it is in the course of the subsequent investigation following seizure of the documents that informed consideration can be given to the documents and an assessment made of their worth or significance in the respects already mentioned.

GLEESON CJ:   That is one of the reasons no doubt why it is conceded that taking possession of the document, or a record, includes taking it away because very often it will only be somebody who looks at it elsewhere and at leisure, and perhaps someone else who is better informed, that will be able to make a final judgment on its utility.

MR GRIFFIN:   Yes but, your Honour, until the point ‑ ‑ ‑

GLEESON CJ:   He might want to take it to a barrister, for example.

MR GRIFFIN:   That may be so.  But, your Honour, up until the point where some specific items are identified as privileged, the order of the Court of Appeal made in respect of the way in which the investigator or the officers of the Office of Fair Trading may deal with the documents we submit is entirely appropriate.

GLEESON CJ:   You are using words like “items” and “documents”.  We are here talking about a chattel which is part of a computer system, I think.

MR GRIFFIN:   There were other documents seized.

GLEESON CJ:   Well, you told us about the manila folders.  Then how do you apply the principles relating to legal professional privilege to the chattel that I mentioned?

MR GRIFFIN:   Well, because of the electronic nature of the storage of the information, it is entirely possible for those files to be accessed in a limited way and for the inspector to follow the order of the Court of Appeal by inspecting it in that initial and limited threshold way.

GLEESON CJ:   Who decides on the claim for legal professional privilege?

MR GRIFFIN:   Well, the claim must be made by the person claiming the privilege.  Then there are ‑ ‑ ‑

GLEESON CJ:   Who makes the claim in relation to what in the case of the hard drive?

MR GRIFFIN:   In relation to the hard drive, those documents or pieces of information contained electronically on the hard drive must be identified by the person claiming privilege.

GLEESON CJ:   And was that done here?

MR GRIFFIN:   No.  There has been no such claim.  There has never been a claim.  All that has been said is that the hard drive contains some documents or documentation which is privileged, or information ‑ ‑ ‑

CALLINAN J:   I thought that when the parties appeared before me there was going to be identification of documents that might be subject to legal professional privilege and that a claim would then be made.  That was what I thought was going to follow the order that I made ‑ ‑ ‑

MR GRIFFIN:   Yes, that is so, and it has reached this stage, as I understand:  the disks have been copied and in the copying process there needs to be further steps taken before the disks can even as copied be read before that identification process takes place.

CALLINAN J:   You say the claim has not been made, but you understand that it has always been the position, has it not, that the applicant does not want you to look at those?  I thought it was implicit in everything that was said before me that there was such a claim in respect of those ‑ ‑ ‑

MR GRIFFIN:   Your Honour, when I use the expression “claim”, I mean a specific claim as to a particular document contained within that electronic form.  It is not sufficient, we submit, that a general claim of privilege is made.

CALLINAN J:   Well, it is different from a discovery process.  In a discovery process all the documents have to be identified, including those subject to legal professional privilege, and then the claim is made.  But you have everything here.

MR GRIFFIN:   And so we do.

CALLINAN J:   You have had inspection before you have had discovery.  I just do not know whether civil rules in relation to discovery and inspection in ordinary proceedings are relevant here.  I do not see why they cannot make a general claim in respect of legal professional privilege.  They may not necessarily have to make it other than generally, I do not know.

MR GRIFFIN:   My submission is that the documents or the information, whatever one calls it, contained electronically must be individually identified because it is clear that there is other information implicit from what is said by our learned friends clearly about which there is no claim for privilege.  An example would be a claim in this form, the sort of specific claim we refer to, all documents to or from a particular firm of solicitors.  That would be sufficient to identify that class or characterise documents in

electronic form about which a claim is made, but no type of specificity has been attempted.

CALLINAN J:   Mr Griffin, I just want to be clear about this.  Are there two construction points involved in respect of clause (e)(iv), the first being that you can look at, as it were, all of the relevant business of the party under investigation because that may be “with respect to any matter in contravention of this Act”?

MR GRIFFIN:   Yes, that is so.

CALLINAN J:   That is one.  The other construction point is whether the hard drive which contains all of the files, assuming that the first question is answered against you – whether the hard drive containing all of the materials, falls within “records” or falls within the matter, the various items that can be seized or taken possession of.

MR GRIFFIN:   Yes.

CALLINAN J:   So there are really two construction points.  If you win on the first one, the second one does not become relevant.

MR GRIFFIN:   Yes.

CALLINAN J:   Whereas, if you lose on the first one, the second one then has to be ‑ ‑ ‑

MR GRIFFIN:   Yes.  May I say something about that, for I have not yet.  The word “records” is defined under section 5.  I do not think that was mentioned to your Honours.  It reads in this way:

“records” includes any record of information however compiled, recorded or stored and any books, documents or writings.

It is comprehensive and, as his Honour the Chief Justice said, it is comprehensible in terms of what it means.  It is broad and it clearly, in our submission, comprehends that electronic piece of stored information, the hard drive.  It was absolutely entitled to be taken possession of pursuant to section 89(1)(e).  Those are our submissions.

GLEESON CJ:   Thank you.  Yes, Mr Richter.

MR RICHTER:   If the Court pleases.  First of all, in relation to the question that your Honour Justice Callinan raised in relation to the legal professional privilege issue.  Your Honour’s interlocutory order is at page 64.  What was envisaged there was that the respondents to this appeal compile a list of claimants who have made complaints, of the ones that they wanted, and that that list be given to us within seven days.  There was meant to be:

within fourteen (14) days . . . the complete personal files relating to each of those complainants will be printed out in hard copy in the presence of representatives of the Applicant and Respondent (by KPMG) from the copy of the disks made pursuant to . . . 

4.  The copy of the disks made will then be retained by the Applicant.

So there was a process whereby what they wanted they were going to get by way of consultation, which does not relate to the issue of legal professional privilege.  The issue of legal professional privilege was something else.  We were not tasked of going through the whole compendious record of entries on that hard drive and isolating every letter.  There was agreement, both at first instance and later on, that there was correspondence, for example, with solicitors which would be subject to legal professional privilege and to which they were not entitled.  If one looks at paragraphs 14 and 15 of her Honour’s judgment at pages 7 and 8, her Honour says this:

Ms Wilson also deposes to categories of other documents that are stored on the server including tax invoices, correspondence to clients, creditors, debtors, the Australian Taxation Office, solicitors, banks ‑

et cetera, and the second last line on that page, documents or records relating to a restaurant at Broadbeach that had absolutely nothing to do with the business.  So there was agreement that records – there were records to which the inspector was entitled and there were records to which the inspector was not entitled, including ones subject to legal professional privilege, and over the page, having regard to the way the computer was seized:

Ms Wilson also swears that the server contained a substantial number of documents and correspondence sent to and received from the applicant’s various legal advisers solely in relation to past and current legal matters of a confidential nature.

That had to do with correspondence about the 39 complaints, or some other historical complaints.

No claim for legal professional privilege was made at the time the server was seized, but it is not suggested on behalf of the respondent

that there has been any waiver of the right to claim legal professional privilege.

So that legal professional privilege was a live issue.  The course that the Court of Appeal took in resolving it was to say, “Give it to the inspector, let him see whether there is legal professional privilege and if there is, well, he shouldn’t look at it”, which is wrong.

The matter of general importance is really to do with the fact that the 20,000 – there were not just 20,000 records; there were 20,000 clients.  There were a lot more than 20,000 records.  The notion of seizing the whole server in the context of a review of an administrative decision raises Wednesbury unreasonableness and all the rest of it, none of which was addressed by the Court of Appeal.  This was a review of an administrative decision, and the Court of Appeal took the…..and for no greater reasons than those adumbrated by Justice Mullins, decided that, in fact, the computer server was a record, a seizable record, where contextually it was just as arguable that it was not, as her Honour Justice Mullins founds.  If the Court pleases.

GLEESON CJ:   Yes.  In this matter there will be a grant of special leave to appeal.

AT 11.00 AM THE MATTER WAS CONCLUDED