Y & Anor v Australian Prudential Regulation Authority & Anor; Kamha v APRA & Anor

[2006] HCATrans 420

[2006] HCATrans 420

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S112 of 2006

B e t w e e n -

Y

First Applicant

Z

Second Applicant

and

AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

First Respondent

MARK GODFREY

Second Respondent

Office of the Registry
  Sydney  No S113 of 2006

B e t w e e n -

X

First Applicant

Z

Second Applicant

and

AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

First Respondent

MARK GODFREY

Second Respondent

Office of the Registry
  Sydney  Nos S6 of 2006 and S7 of 2006

B e t w e e n -

ASHRAF IBRAHIM HELMY KAMHA

Applicant

and

AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

First Respondent

DARRYL ROBERTS

Second Respondent

Applications for special leave to appeal

GUMMOW J
KIRBY J
HEYDON J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 4 AUGUST 2006 AT 9.51 AM

Copyright in the High Court of Australia

__________________

MR T.F. BATHURST, QC:   If the Court pleases, in the first two matters called, S112 of 2006 and S113 of 2006, I appear with my learned friend, MS D. HOGAN‑DORAN, for the applicant.  (instructed by Minter Ellison)

MR J.W.J. STEVENSON, QC:   And in those matters I appear with MS M.N. ALLARS for the respondent, if your Honours please.  (instructed by Sparke Helmore)

MR A.J.L. BANNON, SC:   If the Court pleases, in matters S6 of 2006 and S7 of 2006, I appear with my learned friend, MR P. ZAPPIA, for the applicant.  (instructed by Varrasso & Associates)

MR S.J. GAGELER, SC:   And I appear with MS L. McCALLUM, SC for the respondents.  (instructed by Australian Government Solicitor)

GUMMOW J:   Are we right in thinking that there are some common legal issues in these matters?

MR BATHURST:   Yes, certainly, the construction of section 25A of the Insurance Act.

GUMMOW J:   Yes.  Well, we will hear first from you, Mr Bathurst, then from Mr Bannon and then from the respective opponents.

MR BATHURST:   If the Court pleases.

KIRBY J:   That is your most promising point, is it not, of general importance?

MR BATHURST:   Yes.  We say the Full Court erred in holding the disqualification power was not subject to any jurisdictional limitation.  Your Honours will find the finding of the Full Court to the contrary at page 78 of the book, paragraphs 34 and 35.  Reading from the second sentence of paragraph 34:

In the course or oral argument it became clear that, for the appellants to succeed, s 25A should be read as limited to persons in respect of whom there are reasonable grounds to believe they will hold one of the positions set out in s 24(1) in the future.

We cannot agree.  The asserted construction is to read into the provision a species of jurisdictional fact not supported by the words of the section.  The relevant connection with insurance business in Australia is provided by the positions in s 24.

Contrary to what the Full Court said, in our submission, there are, we say, two jurisdictional preconditions in the exercise of the disqualification power by APRA.  The first is that the “senior manager” within the definition of that expression in the Act refers to a person who is or is reasonably likely in the future to occupy that position.  The second is, in the case of a foreign general insurer, the person must have responsibility for that part of the foreign insurer’s operation which touches and concerns the Australian operation within the meaning of the prudential standards at the relevant time. 

Put another way for the purpose of my client, we submit that the power does not extend to disqualify a person who is a senior manager of a foreign general insurer but whose activities do not or are not likely to involve any connection with the insurer’s Australian operations.  Can I seek to make those propositions good by taking your Honours to the legislation.  The relevant passages are conveniently set out in the judgment of the Full Court.

KIRBY J:   I may have misled you in the question I asked you.  The matter of general importance, as it seems to me, is the argument on the Royal Commissions Act.  I would like to know, is that common to both cases or is that only arising in yours?

MR BATHURST:   It would affect Kamha because in Kamha a similar approach was taken by the regulator as I understand the position on the notice to show cause.  The application in Kamha, however, has not directly raised the point.

GUMMOW J:   It is not in their draft notice of appeal, is it?

MR BATHURST:   No.

MR BANNON:   If I can be permitted to say, we would seek leave to add it.

GUMMOW J:   Fancy that.

MR BANNON:   If it is a good point.  If it is not, then we do not.  But all the material is in the Kamha ‑ ‑ ‑

GUMMOW J:   Just wait a minute, Mr Bannon.  Was it argued by your side in the Full Court of the Federal Court?

MR BANNON:   No, or trial, no, we did not.

KIRBY J:   Well, you are riding on this issue in a sense.

MR BANNON:   But all the evidence to show that they did rely on Royal Commission evidence was tendered in our proceedings, so it is there.  So that it would make no difference to ‑ ‑ ‑

KIRBY J:   I only said that that was the matter that interested me, because in this age of Royal Commissions and inquiries and so on, the formula that is used is one that is likely to be repeated in federal legislation and therefore seems to be a matter of some importance generally.

MR BATHURST:   We would submit, with respect, that is correct.  Perhaps in adopting what your Honour first said, I should have an anxiety to adopt any help from the Bench.  We say both points are important.  It is surprising, in our respectful submission, if the regulatory power under section 25A can extend to people who have no connection with any insurance business in Australia.

KIRBY J:   Well, no connection is – I mean, that is not really the facts in this case – no connection – and given that the purpose is protective.

MR BATHURST:   Can I say this about the facts.  There were affidavits read in the trial which asserted the proposition which I was just putting to your Honours.  The deponents to the affidavits were not cross‑examined.  His Honour the trial judge in reaching a contrary view relied on certain file notes of APRA which showed – and I am putting this very broadly – meetings from time to time that APRA had with these people and also demonstrated that at a particular point of time the applicant Y had overall responsibility for the Australian operations.  That was in the past.  His Honour relied on that to, in effect, reject what was said in the affidavits.  That was the subject of a separate ground of appeal which the Full Court did not deal with because they found that there was no jurisdictional limit at all.  So it is still an open question, although it is not a question, we accept, for this Court. 

The purpose, as your Honour Justice Kirby said, is protective.  That can be shown just by looking at section 2A which is reproduced at the top of page 69:

(1)The main object of this Act is to protect the interests of policyholders and prospective policyholders under insurance policies (issued by general insurers ‑ ‑ ‑

KIRBY J:   But it is also shown by the sanction that the Parliament has provided, which is disqualification, which is to get people out of the industry so that they cannot do any harm to policyholders.

MR BATHURST:   Disqualification, of course, in cases such as Rich has also been held to constitute a penalty.  But we accept, with respect, what your Honour says.

KIRBY J:   It is a simple penalty.

MR BATHURST:   Yes.  I should take the Court to the definition of “senior manager”.  That appears at the top of page 74 of the book.  “Senior manager” is defined as:

a person who has or exercises any of the senior management responsibilities (within the meaning of the prudential standards) –

They are set out underneath, “primary responsibility” for various matters.  Disqualification power is in section 25A, which your Honours will find at page 70 at line 30:

(1)APRA may disqualify a person if it is satisfied that the person is not a fit and proper person to be or to act as someone referred to in paragraph 24(1)(a), (b) or (c).

Section 24 is set out on the following page:

(1)      A disqualified person must not be or act as:

(a)     a director or senior manager of a general insurer –

and then there is an exclusion for a foreign general insurer but a senior manager is brought back in subsection (b):

a senior manager, or agent in Australia for the purposes of section 118, of a foreign general insurer –

Now, read without limitation, the power conferred on APRA to preclude a person from acting as a senior manager of a foreign general insurer extends to a power to disqualify a person whose primary responsibility did not at the relevant time and is not likely in the future to touch and concern any of the matters referred to in the definition so far as they relate to the Australian operations.  Now, the Full Court went further saying it was not necessary as a precondition that there is any likelihood at all that a person would occupy such a position whether in Australia or elsewhere. 

The proposition we put is this, that such a construction goes well beyond what is required to enable APRA to fulfil its objectives.  The provision should be read down to ensure a territorial mix, as we say, sufficient to enable APRA to achieve its objectives.  The limitations we submit that should be placed on the section achieves that result.  It also has the effect of ensuring that ‑ ‑ ‑

KIRBY J:   After the last application, that seems a rather old‑fashioned submission, that one has to read down federal legislation in that way, given especially that the insurance industry is a global industry.

MR BATHURST:   The insurance industry is a global industry.  The one consequence of that is that it is quite possible, and we say in this case, that in relation to a particular insurer people occupy responsibilities for the activities of that insurer in different parts of the world and have no connection with the activities in this country.

KIRBY J:   Yes, but if they do have some connection, then why is not the regulatory body able under the legislation to prevent them doing so to the disadvantage of Australian policyholders if that is their assessment?

MR BATHURST:   We do not dispute that proposition.

KIRBY J:   As a risk.

MR BATHURST:   We dispute the words.  The difficulty is that the Full Court did not find such a connection was necessary.  That is the issue.  Justice Lindgren, by contrast, found that there needed to be a connection, something that was supported by APRA, at least at first instance.  That was before Kamha.  Our complaint, at least so far as this Court is concerned, is the proposition that there need be no such connection whatsoever.  That is the nub of the issue. 

It also has the effect of ensuring that sections 24(1)(a) and (b) can be read harmoniously.  There is no reason, in our respectful submission, to exclude foreign general insurer in subsection (1)(a) merely to bring this foreign general insurer back in subsection (b).  That points – and we have to accept not powerfully but to some extent – to the limitation on the disqualification power for which we urge. 

Now, could I then turn to the second point, the Royal Commission point.  The facts were that each ‑ ‑ ‑

KIRBY J:   Your clients voluntarily came out to Australia and they gave evidence before the Royal Commission and then they find that, contrary to what appears to be the general purpose of section 6M, they end up having that evidence thrown back in their face.

MR BATHURST:   They certainly will not make the same mistake again, which could be to the detriment of such inquiries.

KIRBY J:   How can you say it did not harm them?  I just do not really follow.  What was the reason given by the Full Court?

MR BATHURST:   The reasons given by the Full Court, with the greatest of respect, are a little bit obscure.  Your Honours, what they seemed to say is that the section had to be read consistently with section 6N of the Act.  If your Honours could go to page 88 of the book, your Honours will see there they say:

The prohibited conduct under s 6M and under s 6N will be punishable if it is engaged in for one of three reasons.  In the case of 6M . . . 

(b)for or on account of any evidence given by him or her before any Royal Commission –

Then you go down to 6N:

(b)for or on account of the employee having given evidence before a Royal Commission –

Their Honours then refer in the succeeding paragraphs to the way the primary judge construed it and the way APRA sought to construe it – that is on page 89, lines 20 and 25 – and your Honours will see, whatever else be the case, it involved some violence to the words which the Full Court accepted.  The Full Court then seemed to accept that such violence should be done.  The reason appears probably most clearly on page 91 in paragraph 74 of the book:

The primary judge construed s 6M(b) as being concerned with causing violence, punishment, damage, loss or disadvantage for or on account of a person’s having given evidence on a particular topic.  His Honour considered that the expression “any evidence given by him or her before any Royal Commission” signifies, not the underlying facts of which evidence was given, but the act of giving evidence on a particular subject matter.  That is distinct from “having appeared as a witness before any Royal Commission” as referred to in paragraph 6M(a).

KIRBY J:   That is the key to it, is it not, whether it is the act of going into the witness box as such or whether it is what you actually do in the witness box?  Now, at least arguably the whole point of this section in the Royal Commissions Act is to say in certain matters it is more important that we get at the truth and to the social benefit and for any legislation or policy that we have the matter exposed and we are going to just protect that.

MR BATHURST:   Its exposure permits an investigation of the underlying facts that facilitates an investigation.  There is any number of Royal Commissions which have recommended prosecutions.  Then the prosecuting authority, or ASIC in certain cases, for example, investigates the underlying facts.  What cannot be done and what section 6M is directed against is what happened in this case.  Your Honours can pick that up at paragraph 8 of the judgment on page 64.  “Evidence provided by you to the Royal Commission says ‘you are not a fit and proper person’”.  We say that is prohibited by the plain words of section 6N ‑ ‑ ‑  

KIRBY J:   The very fact they used that expression is itself, I think, telling in your favour.  I suppose the problem is, where do you get to a point where you can draw a line between the actual evidence, the words said on the transcript, and the material to which inevitably that evidence takes the investigator?  If one is out, the other is available.

MR BATHURST:   Yes, your Honour, and we would submit there is nothing unusual about that.  That is ‑ ‑ ‑

KIRBY J:   What happened in your client’s case?  They alleged the evidence should go ahead.  Have they given particulars or have they used any material that shows that it is the actual words that were used that are going to be thrown against your client in the prosecution or in proceedings?

MR BATHURST:   Can I give your Honour an example.  If your Honour drops down on page 64 to line 50:

(o)      In your witness statement –

which was given to the Commission and was subject to the protection of the Act –

you stated [certain things].

(p)      You also stated [certain things].
(q)      In oral evidence to the Royal Commission, you . . . stated –

and there is no doubt in this case, with respect, that they are relying not on the underlying facts but what was said.

GUMMOW J:   Now, Mr Bathurst, why do you have two leave applications?

KIRBY J:   Are you making Mr Bannon’s for him?

GUMMOW J:   No, there are two matters.  Why is this?

MR BATHURST:   No, I  understand what your Honour says.  There were separate proceedings in relation to each of these two persons.

GUMMOW J:   Were these appeals heard together?

MR BATHURST:   Everything was heard together.  I cannot give your Honour any satisfactory explanation other than that.  They raised identical issues.

GUMMOW J:   We will just grant leave in one of them, I would have thought.

KIRBY J:   Not two fees, I hope.

GUMMOW J:   Now, what was the nature of the proceeding?  It was an AD(JR) application, was it?  Justice Lindgren does not really explain it.  Then there were separate questions, A and B, which appear at page 3.

MR BATHURST:   If your Honour goes to Justice Lindgren’s judgment, there was an AD(JR) application.  Pleadings were then filed and the separate questions were ordered by his Honour.  So it is an AD(JR) application, yes.

GUMMOW J:   Yes, and it is questions A and B?

MR BATHURST:   Yes.

GUMMOW J:   So what you would want from us would be the appropriate answers and then it would go back to Justice Lindgren to deal with the rest of the matter, if anything remained.

MR BATHURST:   It would go back to either Justice Lindgren or the Full Court, because the Full Court did not deal with what I call the factual ground of appeal.

GUMMOW J:   They only had A and B, did they not?

MR BATHURST:   They only had A and B.  As the Full Court pointed out, Justice Lindgren seemed to go a little bit further than answering the questions by reaching a determination that there was a requisite connection.  Justice Lindgren, of course, said there had to be a connection and he said it was satisfied.  There is an appeal from that but, as I said, it does not concern this Court.  They are our submissions, if your Honours please.

GUMMOW J:   So you would have it go back to the Full Court, would you?

MR BATHURST:   We would have it go back to the Full Court.

GUMMOW J:   To do what?

MR BATHURST:   I am sorry.  If your Honours found that there was a connection, it would have to go back to the Full Court to determine that part of the appeal which they did not determine, namely, the factual question.

GUMMOW J:   Where do we see that on the grounds of appeal to the Full Court?  At the moment separate questions are hived off and there is a problem that may emerge.

MR BATHURST:   Yes, it always happens.

GUMMOW J:   I do not think we have the grounds, you see.  I may be wrong.

MR BATHURST:   No.

KIRBY J:   It would probably be 4 on page 43.  You say:

3.His Honour erred in construing the Royal Commission Act . . .

4.His Honour erred in finding that the respondents are not causing and have not caused or inflicted any loss, damage or disadvantage on the first applicant.

MR BATHURST:   Yes.

GUMMOW J:   Well, the question itself, “Does the use by the first or second respondent of the evidence of the first applicant before the Royal Commission contravene”, that would involve us, I suppose, going through that evidence, would it not, or is it a question that can be answered at some higher level of generality?

MR BATHURST:   No, it can be answered at a higher level.  We would simply seek to rely on the notice to show cause itself which of its very nature showed that the evidence was being used.

GUMMOW J:   Yes, I see.

MR BATHURST:   We do not see any factual issue.  I was probably incorrect when I said a moment the relevant factual ground in the Full Court appears at page 40 of the book at paragraph 2.  That, of course, is not a matter we would trouble your Honours with.

GUMMOW J:   Yes, I see.  Thank you.

KIRBY J:   You would not just have seen the way the wind was blowing and want to jump on the bandwagon that you think might have some momentum behind it?

MR BANNON:   I do not.

GUMMOW J:   Now, why do you have two notices of appeal, two applications for special leave?

MR BANNON:   I did not know that we did.

GUMMOW J:   Matters 6 and 7.

MR BANNON:   I see.  Two orders were made, I am told, but, again, there were two separate appeals before the Full Court.  There was an appeal and a cross‑appeal and I think ‑ ‑ ‑

GUMMOW J:   I see.  Were they consolidated?

MR BANNON:   Yes, and heard at the same time.  So that there is no good reason at this ‑ ‑ ‑

GUMMOW J:   They were heard at the same time or they were consolidated?  They are different things.

MR BANNON:   I am sorry, there was no consolidation order as such.

GUMMOW J:   I see.  Yes, go on.

MR BANNON:   Can I just say briefly in relation to 6M, no, we did not argue it and we have not raised it before, but we would seek ‑ ‑ ‑

GUMMOW J:   What was the nature of your proceeding in the Federal Court?

MR BANNON:   AD(JR) Act proceedings, including complaints taking into account irrelevant ‑ ‑ ‑

GUMMOW J:   How can you go outside the grounds of the AD(JR) proceeding?

MR BANNON:   Well, we pleaded taking into account irrelevant considerations.

GUMMOW J:   We do not have the application unfortunately.

MR BANNON:   No.  We pleaded as a general ground taking into account irrelevant considerations.  This was not particularised, but it would be an irrelevant consideration if it was improperly taken into account.  There is no doubt on the notice to show cause ‑ ‑ ‑

GUMMOW J:   Do you have the application there?  It is a good idea for junior counsel to come equipped with these things.  It is part of the job.  Justice Gaudron, I am reminded, always used to say come to Court with your pleadings.

MR BANNON:   Yes.  We will have to locate that.  It is not here.  But I can at least say this.  Irrelevant considerations was relied upon as a general ground and there were a series of particulars and ‑ ‑ ‑

GUMMOW J:   I am not prepared at the moment to hypothesise about all this, Mr Bannon. 

MR BANNON:   No.  But, anyway, I foreshadow that application in the eventuality that ‑ ‑ ‑

KIRBY J:   Assume that we did not think there was a special leave point in the Insurance Act issue but did think that there was a special leave point in the Royal Commissions Act issue, how can you get that into this Court now in the light of the procedural history of your case and where it stands and the matters you have put before us to argue for special leave?

MR BANNON:   Yes.  Well, as I say, we would need an amendment to the original application.

GUMMOW J:   Yes, that is right.

MR BANNON:   Or least an additional particular.  Well, a practical effect of an amendment.

KIRBY J:   Just explain to me how in your case – you see, you at least were an Australian officer who acted in a way which was criticised and you have offered this promise not to act, but it just seems to me that is a hopeless case under the Insurance Act.  But what was the use that was made of your client’s evidence and is that in the application book, the Royal Commission evidence?

MR BANNON:   It is not in the application book.  It is in the evidence before the courts below, because the notice to show cause ‑ ‑ ‑

KIRBY J:   How can we possibly today, under the pressure of a very heavy list, deal with this matter?

MR BANNON:   Well, we would have to make a special application perhaps on a separate occasion.

KIRBY J:   I just think you just have to go away in the light of whatever happens in the first one you – that is depending on the Court refusing the Insurance Act point.

MR BANNON:   Yes.

KIRBY J:   Is there any point of distinction between you and Mr Bathurst on the Insurance Act point?

MR BANNON:   Except that we did ‑ ‑ ‑

KIRBY J:   You are in a worse position.

GUMMOW J:   Yes, you are much closer to the centre of the national action, are you not?

KIRBY J:   You are really close.  All you have done is promised not to do it and they have said, “Well, just in case, we are going to stop you having a chance and we are going to protect the policyholders”.

MR BANNON:   What we offered was an enforceable undertaking.  We adopt what Mr Bathurst said in relation to construction, but if I can just add these brief points.  There are really three possible approaches to construction:  there is no requirement of nexus for power; the second is that the requirement of nexus is that the person is acting in the position; and the third is something in between.  The something in between which we put to the Court which they rejected was likely to be acting in the position.  The person was not likely to be acting in the position if they were offering an enforceable undertaking.

KIRBY J:   That is not a special leave point.  Assuming that to be a correct principle, that is just a matter for the protective authority to weigh up and consider in all the facts of a particular case.  The question is:  do they get the facts from a Royal Commission?

MR BANNON:   But at the moment the position is, as a matter of construction, the court has said no nexus is required and if no nexus is required – and the general principle of construction of the Act is an important matter for this Court and it affects a large number of potential applicants, as referred to in our application book and summary of argument.  So that is a question of important principle and identifying what the nexus is is important.  Then we would say, if the nexus is in the industry, then we win.  If it is likely to be, we also win because we offered an enforceable undertaking.  The question of construction and whether there is ‑ ‑ ‑

GUMMOW J:   What do you mean by “enforceable undertaking”, by the way?

MR BANNON:   There is a provision under section 126 of Insurance Act which provides that an undertaking to not act in a position may be accepted by APRA and it can be enforced through the Federal Court.

GUMMOW J:   So you have a constitutional point too?

MR BANNON:   Yes, that arises in this ‑ ‑ ‑

GUMMOW J:   …..to its feet as well?

MR BANNON:   No, it flourishes in this way, to this extent.  In a sense it piggybacks in part on the argument in relation to construction, because if the position is no nexus is required as a matter of power, it involves a proposition that by identifying any person without a connection with the industry one can visit on that person the stigma of disqualification and publicity which could only operate as a punishment.  What we say, this case, as applied to these facts, is an example of the difficulty and danger of attempting to draw a bright line between a purpose of protection and a purpose of punishment.  It also assumes the existence of a bright dividing line between a purpose of general deterrence ‑ ‑ ‑

GUMMOW J:   But lots of licensing systems involve removal of a licence or failure to renew a licence by administrative process.

MR BANNON:   Yes, but this is not a licensing case because the licensing cases referred to are circumstances in which the very statute which grants the licence to engage in the activity is also the statute which takes it away.  This is a case where there is no licence required to act in the industry but the power assumed by the Full Court is to visit upon any person, with or without any connection with the industry, the stigma of public denunciation on the basis of publicised grounds, in this case of dishonesty, in circumstances where there is no provision for the giving of reasons.  So the publication of either nothing, the mere fact of disqualification cannot uphold the standard, or incomplete particulars, cannot inform the industry as to what the standard is which has been applied.

KIRBY J:   It was Dr Roberts in this case, was it not?  Was he the authority?

MR BANNON:   Yes.

KIRBY J:   He did, in fact, give explanations and I assume that is the practice of good administration. 

MR BANNON:   But that is just simply in the statement of reasons.  The purpose of general deterrence ‑ ‑ ‑

KIRBY J:   It would be a fantastic position to arrive at that a person who has been involved in the industry who has done things in the industry that have been criticised by a Royal Commissioner gives an undertaking but that the authority, by his action, is thereby deprived of the opportunity to protect policyholders and to uphold the standards.  That is what it is there for.

MR BANNON:   But the analysis of precisely how it does uphold the standard is the sticking point, as far as we are concerned, because if the ‑ ‑ ‑

KIRBY J:   One way to uphold the standards is to protect policyholders, permanently or for a time, from the participation of people who have been found to have acted in an improper way.

MR BANNON:   Justice McHugh made clear in Woolley’s Case that if a power which is exercised for a principal purpose of general deterrence has a consequence which is regarded as punitive, it can be a punitive power, or exercised for a punitive purpose.  In this case the Full Court and Justice Gyles were agreed that the decision to disqualify, rather than simply accept the undertaking, was made for the purpose of publishing the decision for the purpose of stigmatising the individual for public denunciation.

KIRBY J:   Yes, but it is a bit like striking solicitors and barristers off the roll and I have sat there in so many of those cases and you say the words, “We are not doing this to punish the practitioner; we are doing it to protect the public” and, of course, there is a punitive consequence.  It is not the purpose of the power.  This purpose is to protect policyholders.

MR BANNON:   But the particular purpose found here was a purpose of general deterrence based on this proposition, as appears at 62 of the application book at about line 20, namely:

reflect a purpose of publication of the disqualification to ensure the “section 24 professions” understood the consequences of a failure to meet the standards referred to.

The consequences are identified at line 25 ‑ ‑ ‑

KIRBY J:    I know you have criticised that, but it is one of the functions of a regulatory authority.  It has declaratory objectives but it also has enforcing standards and thereby sending an inevitable message, just as when you strike a barrister off for not putting in tax returns for 50 years, and you are sending a message you cannot do that.

MR BANNON:   But the message is, in effect, “If you behave in a particular way, we will do the same to you what we did to this person”, and “what we did to this person” is identified in line 25 on the same page, is public denunciation by stigmatism.

KIRBY J:   Was that expression ever used?  I know you have used it, but I looked through what Dr Roberts had written and I did not see the actual words that you object to.

MR BANNON:   Well, no, sorry, Dr Roberts did not use those words, but it is the find of Justice ‑ ‑ ‑

KIRBY J:   No.  It is your statement of the equivalent of what is said?

MR BANNON:   Justice Gyles’ finding as a matter of fact is what the effect of it was, and accepted by the Full Court, as appears at line 25.  So that in circumstances where the general deterrence object is achieved by saying, “If you engage in this sort of conduct, we will do to you what we did to this gentleman”, namely, publicly humiliate them or denounce them, that is achieving general deterrence by ‑ ‑ ‑

KIRBY J:   It is not really humiliation and denunciation.  It is simply making a protective order.

MR BANNON:   It only has that protective fact, we say, your Honour, if it intimidates others ‑ ‑ ‑

KIRBY J:   Intimidate is one word, but set standards which you then know and everyone knows – everyone in the industry knows they have to conform to.

MR BANNON:   But the great difficulty with the standard setting, your Honour, is that the statement of reasons are provided under the regime of the AD(JR) Act.  They are not published reasons.  The only guidance from the legislation is that particulars of the disqualification are to be published in the Commonwealth Gazette.  The particulars of the disqualification do not amount to a statement of reasons ‑ ‑ ‑

KIRBY J:   It is not a big denunciation.

MR BANNON:   If one takes a Court of Appeal hearing in relation to a legal practitioner, the reasons are set out.  Similarly an ASIC‑type hearing before a court, the reasons are set out and people in the industry or the profession can see what the conduct is which was the subject of review and consideration and standards can be identified.

KIRBY J:   There would be a lot of people who would opt for a denunciation in the Commonwealth Government Gazette hidden away on page 4720 to a Court of Appeal decision in a strike‑off application. 

MR BANNON:   The point of difference is one can see in a statement of reasons the nature of the conduct which should not have been engaged in.  You are not going to get that, we say, on a proper reading of this legislation.  It does not provide for that.  So it cannot inform in relation to standards.  It cannot tell you what the norm of conduct is which should be behaved or how it was applied in a particular case.  The only way in which it can operate as a general deterrence is to say, effectively, “We have visited on this person this punishment and that is the reason why” ‑ ‑ ‑

KIRBY J:   I think you have got as much blood as you are going to get out of that stone.  I do see the point that, if the authority is going to make these orders, there ought to be some, even if necessarily brief, statement which indicates why it has done so.  That is good administration, but it is not in the Act, and that is your complaint.  But if the Court were against you on that point, which is the only point you came to argue, you really have to throw yourself on our mercy, do you not?

MR BANNON:   We rely on the construction point ‑ ‑ ‑

KIRBY J:   And come back on another day with papers.

MR BANNON:   Yes, which we would ‑ ‑ ‑

KIRBY J:   Humbly asking us to overlook your neglect of this obvious point.

GUMMOW J:   And explaining how the point was before the primary judge ‑ ‑ ‑

MR BANNON:   Yes.

GUMMOW J:   ‑ ‑ ‑ with the relevant evidentiary footing and why you should be permitted to now reframe your case.

MR BANNON:   It will arise inevitably, your Honour, either in these proceedings or in other proceedings, because any continuance to act on this material, if the point is a good one, is otherwise restrained ‑ ‑ ‑

KIRBY J:   Should we not let you take other proceedings if, in fact, Mr Bathurst gets special leave and the matter is determined in his favour by the Full Court?

MR BANNON:   Yes.

GUMMOW J:   You will then want to be saying that the Bathurst point was not in your proceeding so you can have a new one and get the evidence right this time with a proper application, and shoulder whatever Anshun says in the administrative law as distinct from common law action. 

MR BANNON:   Yes.

HEYDON J:   Let me just get one thing straight.  You take three points.  One is Mr Bathurst’s first point?

MR BANNON:   Yes.

HEYDON J:   One is the punishments or judicial power point?

MR BANNON:   Yes.

HEYDON J:   And the third on is Mr Bathurst’s 6M point?

MR BANNON:   Yes.

HEYDON J:   Yes.

MR BANNON:   As our submission explains and as I have endeavoured to explain, we say the judicial power point will not arise if one construes the legislation to be limited to persons who are likely to have a nexus and that is an indicator for the purposes of interpretation which assists the interpretation for which both myself and Mr Bathurst contend.

GUMMOW J:   Yes, thank you, Mr Bannon.  Yes, Mr Stevenson.

MR STEVENSON:   Now, so far as the Insurance Act point is concerned, the short answer to Mr Bathurst’s submission that there are two jurisdictional preconditions is that they do not appear on the face of the Act.  A sufficient jurisdictional precondition is that to be found in section 24 which is that the proscribed position is to be one of a foreign general insurer which is a subset of general insurer and must therefore be an insurer licensed to carry on business in Australia, and that is a sufficient connection. 

The protective purposes of the Act would or may well be served by APRA needing to disqualify a person who has no present connection with the foreign general insurer’s business, bearing in mind it is carrying on business in Australia, and no present intention of doing so.  The difficulty for the applicants in this case is compounded by the fact that there are findings that each of them, in fact, did play the role of senior manager of a foreign general insurer and, of course, it is that actual conduct which has caused APRA’s attention to be directed to them.  So our submission is shortly this.  The Full Court was plainly correct and there is no reason to read into the Act a limitation which does not appear there.

Your Honour, so far as the Royal Commission point is concerned, Justice Kirby has correctly identified that the issue is whether 6M is directed to the act of giving evidence or the underlying facts which are revealed by the evidence.  A problem on the special leave application is this, that there has been a finding by the Full Court that on the proper construction of the show cause letters that APRA wrote that APRA was not, in fact, threatening to take action which would cause damage to the applicants by reason of the act of giving evidence but, rather, because of the underlying facts that that evidence revealed. 

That is to be found on page 90 of application book, your Honours, in paragraph 70, 71 and 72.  Mr Bathurst to your Honours to the show cause letter itself which is at page 64, but it is important, when considering whether to grant special leave, in our respectful submission, to appreciate that the Full Court looked ‑ ‑ ‑

GUMMOW J:   We do not need to hear you further on the insurance point.  We are enlivened by the Royal Commission point though.  What do you want to say about that?

MR STEVENSON:   I am addressing that now, your Honours.  The first point is that there is a finding by the Full Court of the Federal Court that on the proper construction of the show cause letters APRA was not, in fact, threatening to ‑ ‑ ‑

GUMMOW J:   They did find it difficult though.  They said it was a difficult point.

MR STEVENSON:   They did not find that the question of construction was a difficult point, your Honours.  In paragraph 70 on page 90 they said that if the show cause letter properly construed is an indication that the action is being taken or contemplated because X gave evidence, then that would perhaps have been within 6M.

KIRBY J:   Yes, but if you give in particulars that you are relying on his evidence and what he said before the Royal Commission, it is pretty hard to say that he is not then harmed by the evidence he has given before the Royal Commission.

MR STEVENSON:   Well, that depends on the proper construction of the letter, your Honour, and there is a finding by the Full Court that on its proper construction, despite the ‑ ‑ ‑

KIRBY J:   I do not care what the Full Court said.  I do not think they are right.  I mean, at least it is arguably open and it is an important point.  You just say it is only confined to actually walking up to that witness box and getting in; after that all bets are off.  Everything you say can be used.  But if you look at the purpose of the provision, the purpose is in the public interest to get out the facts, and you do that by evidence.

MR STEVENSON:   To look at the purpose your Honours need to look at a couple of other provisions of the Act and one in particular is section 6DD which is reproduced at page 80 of the application book, paragraph 39.  That is the use immunity provision and it is in that provision that such protection as may be granted to witnesses to appear before a Royal Commission is to be found.  This shows the Act purely contemplates and recognises the distinction between the giving of evidence and the underlying facts that the evidence reveals.  Section 6DD provides that ‑ ‑ ‑

KIRBY J:   That is quite wide, is it not, “a statement or disclosure made by the person in the course of giving evidence before a Commission”?

MR STEVENSON:   Is not admissible before a court.  That is the limit of the immunity.  It does not say that it is not admissible before, for example, an administrative tribunal and it would lead to the absurd result in this case that, although statements made by X and Y at the Royal Commission would be admissible before an administrative tribunal, APRA would contravene section 6M if it tendered those statements, and that cannot be right, your Honours.  Another absurd result that would follow from the construction for which the applicants contend could be found by looking at 6M ‑ ‑ ‑

KIRBY J:   Can I ask, is there a provision equivalent to 6DD(1) in relation to disciplinary proceedings in a tribunal?

MR STEVENSON:   That is the limit of the immunity.

KIRBY J:   I am sorry, I did not hear you?

MR STEVENSON:   No, there is not, your Honour.  There is not.  That is the only one.

KIRBY J:   So is your point that the ambit of the protection is specifically limited to courts and not to prudential or disciplinary or like regulatory proceedings?

MR STEVENSON:   Yes, and, as the Full Court found or stated at paragraph 75 at page 91 of the application book, the provisions of section 6DD flavour, their Honours said, the extent of the operation of section 6M.  Indeed, it was those provisions that led the Full Court to the conclusion that 6M is only dealing with the act of giving evidence.

KIRBY J:   But you still have 6M(b):

Any person who uses, causes or inflicts, any violence, punishment, damage, loss, or disadvantage to any person for or on account of:
. . . 

(b)any evidence given by him or her before any Royal Commission;

. . . 

is guilty of an indictable offence.

Serious matter.

MR STEVENSON:   Yes, and the question is what that means and my submission is that it must be a reference ‑ ‑ ‑

KIRBY J:   You see it is more than (a) which is “the person having appeared”, which is really your theory of the second.

MR STEVENSON:   Well, can I give your Honours an example which throws up the odd results.  Suppose there is a Royal Commission into the activities of Jones and Brown and Jones and Brown have deliberately set fire to their business premises.  Jones says to Brown, “Let’s agree that you, Brown, will not appear at the Royal Commission”, and Brown agrees.  Jones hears that Brown has, despite that deal, appeared at the Royal Commission and assaults him.  That would be a contravention of 6M(a). 

If Jones hears that Brown has not just appeared at the Royal Commission but has given evidence that the fire has been set and assaults him, that would be a contravention of 6M(b) because the assault is because of the very act of giving evidence.  It is not because of what Brown said because Jones knows that.  But what if an insurer of the premises reads the Royal Commission report?  If 6M(b) has the construction for which the applicants contend, the insurer cannot use that information in any way to cause damage.

KIRBY J:   Yes, but how do you explain the passage on 64 that Mr Bathurst took us to, “You told the Royal Commission.  You stated.  You gave oral evidence to the Royal Commission.  You agreed with counsel.  You stated.  You gave evidence.  You stated.  In a witness statement you stated”?  I mean, all of this is at least strongly arguably evidence given by him before any Royal Commission on which you are relying to harm him.  He has come all that way from overseas to help you, or help the Royal Commission.

MR STEVENSON:   Well, it is our submission the Full Court held that properly construed what that letter is saying is because of the facts revealed by the fact that you gave evidence.  APRA was not saying, “We are going to disqualify you because you gave evidence”.  They are not saying that.  They are saying, “We are going to disqualify you, or contemplate it, because of what underlying facts were revealed by the giving of the evidence”.  Such immunity as X and Y have is to be found at section 6DD, your Honours.  As I say, if that was not right, the consequence would be that although the evidence given by X and Y at the Royal Commission would be admissible before the AAT, say, APRA could not tender it because it would contravene the section.

Another absurd result of the construction for which the applicants contend can be found by looking at 6M(c).  The problem is that the past perfect tense has not been used in 6M(b).  It is used in (a), it is used in 6M(c), it is used throughout 6N.  It is clear from 6M(c) that there is no prohibition on APRA using a document produced by either applicants X or Y to the Royal Commission because the prohibition is against doing damage on account of the person having produced the documents. 

The problem is that the past perfect is not used in (b).  So that means that if X and Y made an admission in a document which they produced to the Royal Commission, APRA could rely upon that.  Yet, if X and Y made the same admission in the course of oral testimony, on the applicants’ view that could not be used or it would be a contravention of the Act for that to be used.  That cannot be what the legislature was intending.  So the point is that a reason for the Court to hesitate to give special leave is because of the obviously absurd consequences which would flow if the applicants’ contention is correct.  Your Honours, there is another one.

KIRBY J:   Would you agree, quite apart from the parties to this case, that the Full Court said that it had difficulties, that the issue is an arguable issue and that in this day of Royal Commissions and inquiries it is a matter of general importance in the extent to which you balance the necessity of society to follow up anti‑social conduct with the necessity of society to get information to a Royal Commission and society without the penalties on people of being harmed for what they say?

MR STEVENSON:   Well, we do not accept that the Full Court expressed any view that there was any difficulty coming to their conclusion, but we do accept that, if we are wrong and 6N has the construction for which the applicants contend, it would have an impact beyond this case.

GUMMOW J:   Yes, Mr Stevenson.

MR STEVENSON:   Can I just point to one other provision to demonstrate what we submit is the absurdity of the construction which is advanced with a view to endeavouring to persuade your Honours that that is a reason to refuse leave.  If your Honours go to 6N and it is found at paragraph ‑ ‑ ‑

GUMMOW J:   Did the Full Court make this point?

MR STEVENSON:   No, they ‑ ‑ ‑

GUMMOW J:   You are strapping them up a bit.

MR STEVENSON:   No, I am not struggling, your Honour.  I am just drawing your Honours’ attention to another difficulty.  They certainly made the point about 6M(c).  They made the point that it would be very odd if, as is obvious, a document produced by X and Y containing an admission was able to be tendered or relied upon by APRA and yet testimony to precisely the same effect could not be relied upon, and that would be a consequence of the construction.

GUMMOW J:   Anyhow, you have another ‑ ‑ ‑

MR STEVENSON:   Another one is, if your Honours go to section 6N, which is at paragraph 57 on page 86, it deals with dismissal by employers of witnesses and, as your Honours can see, it is expressed in the past perfect throughout, the difficulty with 6M being there is no past perfect used in subclause (b).  Now, 6N is in effect a subset of 6M and is directed to employers particularly.  It is quite clear, looking at 6N(b), that what is being addressed is the act of giving evidence.  Now, we accept that the fact that there is a difference between the wording in the two sections isa factor ‑ ‑ ‑

KIRBY J:   I wonder about that because, if you have a juxtaposition between appearing as a witness, which is the act of giving evidence, why do you need to repeat that in (b) in saying “given evidence before a Royal Commission”?  I mean, at least arguably, in order to give the two paragraphs separate work to do, the one is the act of appearing and the other is the substance of what the person when appearing says in evidence.

MR STEVENSON:   It may be that often, indeed, it may be on most occasions, the one would follow from the other, but in my Jones and Brown example where Jones assaults Brown because he has heard that he has gone to the Royal Commission reneging on the deal, that would be a subsection (a), whereas if Jones assaults Brown because he knows what has been said, then that is a subparagraph (b).  So there is room for them both to operate.

KIRBY J:   I am not saying that you would not ultimately win in this.  Very clever people have come to the view that that is the correct construction and matters of construction can go either way.  But it cannot really be denied that this is a significant matter, significant for all people, really, who give evidence before federal Royal Commissions.

MR STEVENSON:   Well, what I am endeavouring to persuade your Honours is that the absurd consequences of the construction are so clear that your Honours could come to conclude now that the prospects of there being a successful appeal are so remote that your Honours would not give leave.  To endeavour to finally develop that point, can I just make the

section 6N point, which is that 6N, being a subset of 6M, if the applicants’ constructions is correct, if, say, an employee gives evidence at a Royal Commission that he has embezzled his employer, under 6N, because the past perfect is used in (b), the employer could dismiss him without contravening section 6N, but he would contravene section 6M, and that cannot be what was intended.  It must be necessary, we say, to read into 6M the past perfect in subclause (b) in order that 6N and 6M sit together harmoniously, otherwise absurd results follow. 

So the two points that we offer in response to the special leave application are (a) that the Full Court has held, and correctly so we say, that on the proper construction of the show cause letters APRA was not threatening to do damage because of the act of giving evidence.  That is the first point.  The second point is that, for the three reasons that I have given, by reference to the three examples I have given, the consequences of acceptance of the applicants’ construction are so absurd that your Honours will be satisfied that there are insufficient prospects of that construction ultimately being accepted to warrant special leave being granted. 

GUMMOW J:   Yes, thank you, Mr Stevenson.  Yes, Mr Gageler, we do not need to hear you on anything else except this ‑ ‑ ‑

MR GAGELER:   The Royal Commissions Act point, your Honour?

GUMMOW J:   No. 

KIRBY J:   You do not want to barge into that, do you?

MR GAGELER:   I wanted to say something about it.

GUMMOW J:   On the Royal Commissions Act point and, to be particular, Mr Bannon’s foreshadowed application, I notice that the upshot of what the Full Court did was to remit to Justice Gyles – you will see that at the order at page 71.

MR GAGELER:   Yes.

GUMMOW J:   Now, it seems to us that if on that remitter to Justice Gyles Mr Bannon was to seek to amend so as to make specific this new ground, that would be something that was open to him.  There would be no Anshun question then arising, would there?

MR GAGELER:   Well, it would be open to him to make the application, your Honour.  I would like to consider the procedural issues that would then arise.

GUMMOW J:   There would be no Anshun question, would there?

MR GAGELER:   Probably not.

GUMMOW J:   Well, there could not be because it is in the one proceeding.

MR GAGELER:   No, I accept that.

GUMMOW J:   This is a product of the separate – one, from his point of view, beneficial consequence of the way the case falls out.

MR GAGELER:   Yes.

HEYDON J:   I think, Mr Gageler, you have to choose between Mr Bannon now or Mr Bannon then.  There is no third possibility.

MR GAGELER:   No.  Mr Bannon now is rather easy to deal with, your Honours.

GUMMOW J:   Yes, go on then.

HEYDON J:   I mean in three months time in Canberra.

MR GAGELER:   Well, for this reason, as your Honours have observed, in this AD(JR) Act case that went for some six days at first instance and then two days on appeal the point was not run and it is not apparent that the point is capable ‑ ‑ ‑

GUMMOW J:   Your client is a public authority.  This is not private inter partes litigation.

MR GAGELER:   No, I accept that.

GUMMOW J:   Your authority is charged with the administration of this Act and if there is a problem about it ‑ ‑ ‑

MR GAGELER:   It is not apparent that it arises on the facts, however.

GUMMOW J:   I do not know the answer to that, of course.

MR GAGELER:   Well, it certainly does not arise on the facts as recounted in the judgment of the Full Court.  One would have to trawl back through the facts to see if there could be found to be a foothold, because to have a factual foothold for the argument based on section 6M of the Royal Commissions Act, one would have to find not simply that the decision of the delegate was based on evidence given in the Royal Commission but based on the evidence given by Mr Kamha in the Royal Commission.  The gist of reasoning of the delegate your Honours find at pages 48 to 49 of the application book. 

Nowhere in the reasoning that begins at the bottom of page 48 and then continues on for a couple of pages do you find any reference to evidence given by Mr Kamha as being the basis for the decision.  So what I do not have, because the point was raised with me at 10 past 9 this morning, is the totality of the statement of reasons, but what we do have is the reasoning as expressed as the conclusions for the order that was made by the delegate and nowhere there do you find any adverse consequence ‑ ‑ ‑

GUMMOW J:   These are powerful reasons for us not dealing at this level with an amended application in respect of the grounds of appeal that would be put.

MR GAGELER:   Yes.  So on this point your Honours ought simply dismiss the special leave application with costs and Mr Bannon can take what course he thinks is appropriate in another place.

GUMMOW J:   Yes, but in the context that in the meantime we may have decided this appeal favourably to Mr Bathurst.

MR GAGELER:   Well, your Honours may have decided a legal point favourably to Mr Bathurst which may or may not be of assistance to Mr Bannon.

GUMMOW J:   We will have decided the point about the construction of the Royal Commissions Act.  That is right.

MR GAGELER:   Yes.  All I am saying is that, even if that were decided in favour of the applicants, that may not assist the applicant in this particular case.

GUMMOW J:   It may or may not, but that would be a question for Mr Bannon to agitate before Justice Gyles with, if need be, such further evidence as he would need.  I do not know at the moment if he would need further evidence to make his point good.

MR GAGELER:   Possibly, yes.

GUMMOW J:   But what I put to you is that we are doing this on the footing that your client is a responsible public authority and not likely to ‑ ‑ ‑

MR GAGELER:   That is the basis upon which I am appearing, your Honour, yes.

GUMMOW J:   Yes, it is not likely to play Anshun games and so on.  Yes, thank you, Mr Gageler.  Yes, Mr Bathurst.

MR BATHURST:   Two matters.  Paragraph 70 on which Mr Stevenson relied, with respect, does not assist because what was said in paragraph 70 was predicated on the construction of the legislation which we submit was incorrect.  That can be shown from a cursory reading of it:

Taken literally, the X Show Cause Letter might be regarded as offending s 6M . . . If the X Show Cause Letter, properly construed, is an indication that action is being taken or contemplated because X did those things before the Royal Commission, one could conclude that APRA or Mr Godfrey is causing damage, loss or disadvantage to X for or on account of the evidence –

It relies or is dependent on the construction the Full Court ultimately accepted and the construction placed on the legislation by Justice Lindgren. 

KIRBY J:   My note beside paragraph 70 was that quite apart from the principal point you want to argue on the Royal Commissions Act, the letter refers to the act of giving evidence, which says, “Your conduct as set out above”.  So it does seem to be relying on the fact of giving evidence.  At least that is one way to construe that phrase.

MR BATHURST:   That was a construction effectively rejected by the Full Court and has not been the subject of our application, I accept.

KIRBY J:   Yes, well, anyway.

MR BATHURST:   The second issue is this.  My learned friend recited what he described as absurd results.  What he was really saying was, in effect, different sections in the Act have made different provisions for different sets of circumstances.  There is nothing absurd or unusual about that occurring.  It may be relevant to construction, it may not.  The Full Court certainly did not find there was any absurdity.  The highest they went was in paragraph 74 when they said at line 30:

It would be odd if authorities or regulators cold rely on pre‑existing documents . . . as a basis for administrative decision making, yet could not rely on pre‑existing facts and events of which the person testified before the Royal Commission, for the same purpose.

That misses the point.  What the objection is to rely on the actual evidence.  There is nothing odd about being able to use material produced to a Royal Commission to find out facts, but what one cannot do is use the evidence.

KIRBY J:   What is your answer to the point that if the employee gives evidence that he has stolen or embezzled money of the employer, that N prohibits the employer from immediately dismissing him or her?

MR BATHURST:   Your Honour, the employer could not rely on the evidence given by the person who stole it.  The employer would then, however, be able to investigate the underlying facts and if he or she could prove to the requisite standard for dismissal that that occurred ‑ ‑ ‑

KIRBY J:   But what if the only proof is the admission before the Royal Commission?  It would be an odd outcome, would it not?

MR BATHURST:   It may be one odd outcome, but that, in our respectful submission, does not mean one should do violence to section 6M, which we say the construction adverted by the Full Court does.  I have to accept there is an oddity in that.

KIRBY J:   The reason for the two applications is that there was a separate application by X at page 125.  You are appearing for both X and Y?

MR BATHURST:   I was told that when I sat down.

KIRBY J:   But there are common issues, are there not?

MR BATHURST:   Yes.

KIRBY J:   They are really not separate matters.

MR BATHURST:   What I was going to say is that, if your Honours were minded to grant leave, and particularly if your Honours were minded to grant leave on the one question, we would need to amend our notice of appeal and the notice of appeal could be consolidated to include the grounds.  There seems no point in having two applications, with respect.

GUMMOW J:   No.

MR BATHURST:   They are our submissions.

GUMMOW J:   Two appeals.

MR BATHURST:   Two appeals, I am sorry, yes.

GUMMOW J:   So we would grant leave in S112, say.

MR BATHURST:   Yes, and we will amend the notice of appeal.

GUMMOW J:   With leave to amend appropriately.

MR BATHURST:   Yes, if your Honour please.

GUMMOW J:   Yes, thank you.  Yes, Mr Bannon.

MR BANNON:   The additional thing I would wish to say is there is no additional evidence we would need to call in relation to the amendment.  The statement of reasons is before the court below and it recites evidence from our client and relies on that evidence.  So that in this Court it is possible for the Court to permit reliance on a ground not relied on below subject to the usual qualifications, we say none of which would arise.  So your Honour the learned presiding Judge is absolutely right.  We could go back before Justice Gyles but we would simply be out of kilter with the point in the High Court and it would be an inconvenient way of dealing ‑ ‑ ‑

KIRBY J:   Really, seriously, how could we grant special leave when we do not have that material?  It is just not feasible.

MR BANNON:   No, I accept that.  My suggestion ‑ ‑ ‑

KIRBY J:   Therefore the question is, I have to say to you because I do hold to the view that if the matter is alive in the judicature you can raise a point if it can fairly be done by procedures and so on.  So that is the question:  do we have to do it now to preserve the point for you?  Is Anshun a problem for you in the future?  If you come to the view, as I am inclined to, that it is not, then the thing to do is to require you to do this at a later time in the light of what happens in Mr Bathurst’s case.

MR BANNON:   It may be a problem.

GUMMOW J:   Why?  It is in the one proceeding.

MR BANNON:   I am sorry, yes, if we can amend, there is absolutely no problem.  I thought Justice Kirby was referring to doing it after these proceedings.  But my suggestion ‑ ‑ ‑

GUMMOW J:   …..trying to labour the point is that the Full Court referred it back to Justice Gyles.

MR BANNON:   Yes.

GUMMOW J:   He is going to have to have another go at the case and in the course of doing so you may want to expand your grounds of the AD(JR) Act or you may say it is already there, but I do not see how you are foreshadowed from putting this legal argument.

MR BANNON:   No, I accept that.  I thought Justice Kirby was referring to raising the point afterwards.

GUMMOW J:   You say it does not even require any further evidence before Justice Gyles.

MR BANNON:   That is right.  My only suggestion is ‑ ‑ ‑

KIRBY J:   It is only if you would lose that possibility that I would then think of whether we should do it in this case or provide for you to make an application on a later date giving us the material.

MR BANNON:   My suggestion which I put to the Court is that one does not dismiss our special leave application today but stand it over with leave to seek to amend it with the necessary material, and it may be the subject of agreement with our learned friends or it may not.

GUMMOW J:   In the two applications which are together listed as No 2 in the list, there will be a grant of special leave in the first of them, which is matter No S112 of 2006, with leave to amend as necessary so that there is no need for a second appeal in 113.  The grant of special leave, looking at the proposed draft notice of appeal at pages 103 and 104, will be in respect of grounds 4 and 5 but not in respect of the other grounds.  They raise questions in respect of which we think there are insufficient prospects of success on any appeal.

The matter will be no more than one day, I would think.  Solicitors and counsel should be aware that the Court may be able to hear it as soon as the September/October sittings so they can govern themselves accordingly.  It should not be a complicated appeal book.

In the two matters listed as application No 3 we are not satisfied that there are sufficient prospects of success on the grounds presently put forward in the draft notices of appeal.  Leave is refused to amend those grounds to accommodate the so‑called Royal Commission point which has been agitated in the other matter.  However, the Court does note that the orders made by the Full Court require the matter to go back to Justice Gyles.  What we now do in no way forecloses any application which Mr Bannon may then make to Justice Gyles to expand – if indeed that is what is required – the formal basis before that court for any consideration by it of the Royal Commission point, particularly in the light of what will be decided on the appeal in which Mr Bathurst has secured a grant of special leave.  So application No 3 is dismissed with costs.

AT 10.59 AM THE MATTERS WERE CONCLUDED