Uncertainty
27 The contention that the notices are not authorised, or beyond such power as is conferred by s 29, by reason of the uncertainty as to the documents required to be produced must be rejected.
28 The uncertainty relied upon in support of the contention that the notices are not authorised seizes upon the following expressions found within the notices, namely:
· a "business unit" - that being a phrase which expands the ambit of the entities required to produce documents beyond the named company and extending to "all business units or subsidiary companies";
· "all corporate records";
· "indirectly" - that being a term which is applied to "all personnel employed … directly or indirectly" and to "venues/contracts currently serviced directly or indirectly"; and
· the terms "company" and "company's"
29 As the terms of s 29(1)(b) expressly provide, a notice may require the production of a "document or thing specified in the notice…". No greater guidance is provided by the legislature as to the manner in which a document or thing may be identified, other than it must be "specified in the notice".
30 The gravity of the consequences that may flow from non-compliance with a notice, it is considered, is a factor relevant to determining the degree of specificity required: cf Fieldhouse v Commissioner of Taxation (1989) 25 FCR 187 at 208 per Hill J.
31 Section 29 is in different terms to s 155 of the Trade Practices Act 1974 (Cth). Section 155 uses the term "specified" on a number of occasions - but not to describe the information required to be produced when that section is invoked. Section 155 refers to the statutory requirement that there be reason to believe that a person is capable of "furnishing information … relating to a matter that constitutes, or may constitute, a contravention of this Act". The section then authorises the issue of a notice requiring the production of "any such information …". Subject to noting that difference in language, in Pyneboard Pty Ltd v Trade Practices Commission (1982) 57 FLR 368, Northrop, Deane and Fisher JJ relevantly observed at 372:
Questions of ultra vires aside, we would respectfully agree with Fox J that uncertainty or ambiguity will not invalidate subordinate legislation or a written directive issued under statutory power unless a point is reached where it cannot reasonably be given any meaning. Strictly speaking, when this point is reached, what is involved is not a matter of mere ambiguity or uncertainty. As Lord Keith of Avonholm commented in Fawcett Properties Ltd v Buckingham County Council ([1961] AC 636): "If it is impossible, on construction of the condition, to reach a conclusion as to what was in the craftsman's mind, the condition is meaningless and must be read as pro non scripto It is not a question of ambiguity. If a clause may convey several different meanings it is for the court to say, looking at the general background, surrounding circumstances, subject-matter of discourse and other aids derived from the context of the clause, supplemented not infrequently by certain legal presumptions, what meaning is to be attributed to the clause" ([1961] AC at 670).
Their Honours further observed at 375:
The requirement that a notice under s 155(1) convey, with reasonable clarity, to the recipient what information he is required to furnish or what documents he is required to produce is not to be applied in a precious or hypercritical fashion (see Melbourne Home of Ford Pty Ltd v Trade Practices Commission (No 3) (1980) 47 FLR 163). Artificial dissection, in the cause of determined obfuscation, can introduce an argumentative element of uncertainty into words which, when read reasonably in context, are adequate to convey a plain and clear meaning. Provided a notice makes it reasonably clear, in the circumstances in which it is given and on a fair reading of its terms, what information or documents are required, the requirements of s 155(1) as to clarity will be satisfied. In this regard, the mere fact that parsing and analysis in the artificial atmosphere of the courtroom can lead to the identification of a number of latent ambiguities will not invalidate what, as a matter of common sense, is reasonably clear.
On appeal, the decision was affirmed: Pyneboard Pty Ltd v Trade Practices Commission (1983) 152 CLR 328. See also: S A Brewing Holdings Ltd v Baxt (1989) 23 FCR 357 at 370 per Fisher and French JJ; Telstra Corporation Ltd v Australian Competition and Consumer Commission (No 2) [2007] FCA 493 at [36] to [43], 97 ALD 652 at 660 to 662 per Bennett J. Each statutory provision, of course, presents its own potential difficulties in construction. Section 155, for example, employs the language of "information" (Seven Network Ltd v Australian Competition and Consumer Commission [2004] FCAFC 267 at [18], 140 FCR 170 at 175 to 176 per Tamberlin J) - a term less certain in meaning than a "document".
32 Section 264 of the Income Tax Assessment Act 1936 (Cth) likewise employs different language to that employed by s 29 of the 2002 Act. Section 264 authorises, subject to its terms, a notice to be given by the Commissioner requiring a person "to furnish him with such information as he may require …". Gibbs ACJ said that "(t)o be valid a notice to produce documents under s 264(1)(b) must of necessity identify with sufficient clarity the documents which are required to be produced": Federal Commissioner of Taxation v Australia and New Zealand Banking Group Ltd (1979) 143 CLR 499 at 525. Difficulty confronting a person in properly construing a notice is not sufficient to render a s 264 notice invalid. Mason J referred to the expression found in s 264(1)(b) "relating thereto" and continued at 537:
It is then for the recipient to decide for himself, difficult though the task may be, which of the documents answer the description. If his decision is wrong he exposes himself to prosecution and penalty.
The existence of this hazard is not a sufficient basis for the conclusion that the section requires the Commissioner to give a notice in such terms as would enable the recipient on reading it and on examining the documents in his custody or control to determine whether they fall within the ambit of the Commissioner's powers. To so hold would be to impose an impossible burden on the Commissioner.
A notice which is valid under s 264 may thus be "of considerable breadth": Fieldhouse v Commissioner of Taxation (1989) 25 FCR 187 at 193 per Hill J. His Honour there further observed that the validity of a notice should not be "approached carpingly by engaging in a narrow analysis of each word in an attempt to find some latent ambiguity in it": (1989) 25 FCR 187 at 208.
33 Section 77C of the Bankruptcy Act 1966 (Cth) uses different language yet again. Section 77C(1)(b) permits a notice to be issued requiring a person to "produce all books in the person's possession relating to any matters connected with the performance of the functions of the Official Receiver or a trustee under this Act …". In respect to that provision it has been said that a "broad common sense approach" should be adopted. If the demand can be reasonably understood, the notice is valid: CK Nominees Australia Pty Ltd v Official Receiver (WA) [2007] FCAFC 118, 160 FCR 524. A statutory demand had there been issued under s 77C of the Bankruptcy Act 1966 and Moore J concluded:
[39] The appellant made a subsidiary submission that the notice was not reasonably clear about what documents were required. The submission centred on the expression "associated entities" which is used in the definition of "examinable affairs" set out on the third page of the notice (containing extracts from the Act). The expression "associated entities" is defined in the Act (though that definition was not sent with the extracts) and the expression "private company" which is found in the definition of "associated entities" is a defined expression. In my opinion, the primary judge was correct in concluding that the Court should, when construing a notice of the type under consideration, take a "broad common sense approach", an expression which fairly synthesises the more detailed discussion of the Full Court in Pyneboard 57 FLR at 374-375; 39 ALR at 570-571. In construing the reference to "examinable affairs" and looking at the definition, including the expression "associated entities", a recipient could reasonably be expected to understand that the notice was seeking documents concerning the direct dealings of the bankrupt as well as documents concerning the financial affairs of associated entities. That term described with sufficient clarity and as an ordinary English expression what was comprehended by the more precise definition including the reference to private company.
34 Closer to the language of s 29 is s 30 of the Australian Securities and Investments Commission Act 2001 (Cth) which authorises the giving of a notice "requiring the production to a specified member or staff member, at a specified place and time, of specified books relating to affairs of the body". Section 33 is in like terms to s 30. But there again the last phrase confines the books to the affairs of the body to whom the notice is given.
35 The requirements imposed by s 29 of the Australian Crime Commission Act 2002 (Cth) that the matters there identified must be "specified" may well permit less room for imprecision in the identification of documents than that embraced by the Full Court (for example) in Pyneboard. The requirement that there be a "person specified in the notice" would thus not be satisfied if the notice required the documents to be produced to "an authorised officer" of the Commission - such a notice may "specify" a position, but no "person" would be "specified". A notice requiring production at "the Sydney office of the Commission" may similarly "specify" an office, but the "place" would remain unspecified.
36 The Macquarie Dictionary (4th ed, 2005) proffers the following definition of the word "specify":
1. to mentioned or name specifically or definitely; state in detail. 2. to give a specific character to. 3. to name or state as a condition. - verb (i). 4. to make a specific mention or statement.
The accepted public importance of the functions entrusted to the Commission can be no reason to construe the power conferred by s 29 in any manner other than that which the words and the context naturally bear. Nor is there any reason to construe the term "specify" in s 29 in the phrase "a document or thing specified in the notice" in any different manner to the manner in which the same term is used elsewhere in that section.
37 Common to those other statutory provisions which authorise the issue of a notice requiring the production of information or documents, however, has been the concern of the Court to ensure that each of the statutory demands that may be authorised is construed in a practical and common sense manner. Notwithstanding the difference in language as between s 155 of the 1974 Act and s 264 of the 1936 Act, for example, a similar approach has been adopted when considering the degree of certainty required in a notice issued under s 264: McCormack v Commissioner of Taxation [2001] FCA 1700 at [50], 114 FCR 574 at 590 per Sackville J. Ambiguity may be discerned by those with initiative to find uncertainty where none really exists. But that is not the manner in which any of the notices have been construed in the decided cases.
38 The more obscure a category of "document or thing" may be, the greater may be the imperative for that "document or thing" to be described with a degree of specificity or definiteness so that the person upon whom a statutory notice is given may be capable of identifying that "document or thing" and thereafter producing it.
39 It may be necessary at some stage to give greater content to the constraints that are imposed by the use of the term "specify" in s 29. That term may well require a greater degree of precision in the identification of the "document or thing" required to be produced than has been found appropriate in other statutory contexts. That greater degree of precision emerges from the statutory language employed in s 29. And reason for greater specificity may also be required by the very generality of the power conferred by s 29 upon an examiner. There is no express requirement, for example, that a notice issued under s 29 identify on its face the particular ambit of the "special ACC operation/investigation" in respect to which the "document or thing" is considered to be "relevant". There is thus no requirement to identify anything as to the surrounding circumstances, however broadly they may be expressed, within which a person served with a notice can consider the factual or other context within which the power is being exercised.
40 Other statutory provisions stand in a different position. Section 264 of the 1936 Act, for example, is subject in the case of s 264(1)(b) to some constraint by reason of the notice being one "relating" to a person's income - there may thus be reason to at least query the validity of a notice requiring the production a document having no apparent relevance to any person's "income or assessment". When this power is sought to be exercised, attention has been directed to that information which must be conveyed to the person receiving the notice: Federal Commissioner of Taxation v Australia and New Zealand Banking Group Ltd (1979) 143 CLR 499. Mason J there observed at 537:
It is not in dispute that a notice given under par. (1) (b) may validly require the production of something less than all the books, documents and other papers in the custody or control of the recipient relating to the income or assessment of the named person. It may, for example, specify particular documents. Such a notice, if correctly drawn, will make it clear that the requirement extends to the particular documents because they are included in the class of documents of which the Commissioner is authorized to require production.
As the Commissioner's coercive power to require production is limited, any notice given in exercise of the power must in terms conform to the statutory limitations if it is to be valid. It will in my view conform to those limitations only if it clearly confines the documents to be produce to the class of which the Commissioner is authorised to require production, though it may go on to include particular documents on the footing that they fall within that class. If not so limited, the notice fails on its face to express the limitation which the section places on the Commissioner's authority …
His Honour concluded at 539:
…the demand for production must be so formulated that it expresses the limitation impose[d] by the section.
After expressing the view that a notice issued under s 264(1)(b) must identify the documents required to be produced with "sufficient clarity", Gibbs ACJ continued at 525:
However the notice must in my opinion go further: it must show the person to whom it is addressed that any document which he is required to produce is one whose production the Commissioner is entitled to require. Where a notice is addressed to a taxpayer who is required to produce documents which relate to his own income or assessment, the very description of the documents (for example, "your books of account") may be enough to show that the notice is within the power conferred by the section. Where however the notice is addressed to one person, requiring him to produce the documents of another, the notice must show that those documents relate to the income or assessment of a particular person, who must be identified. The power is confined to giving a requirement of a particular kind - a requirement to produce documents relating to the income or assessment of some person - and a notice requiring the production of documents not so related is beyond the scope of the power.
See also: Jacobs J at 541 to 542; Murphy J at 547. See also: Hart v Commissioner of Taxation [2005] FCA 1748 at [95] to [97], 148 FCR 198 at 227 to 228 per Greenwood J.
41 Section 264(1)(a) is not so confined and permits what has been described as a "fishing expedition": Federal Commissioner of Taxation v Australia and New Zealand Banking Group Ltd (1979) 143 CLR 499 at 515 at 535 to 536 per Mason J. Section 264(1)(a) may only be confined by the need to ensure that that power is exercised for the broadly expressed purposes elsewhere set forth in the Income Tax Assessment Act 1936 (Cth): Industrial Equity Ltd v Deputy Commissioner of Taxation (1990) 170 CLR 649 at 659 to 660. A notice issued under s 264(1)(a) need not reveal on its face that the Commissioner is entitled to require the information specified in the notice; it is enough for the notice or the covering letter to record that the information is required for the purposes of the 1936 Act: McCormack v Commissioner of Taxation [2001] FCA 1700 at [46], 114 FCR 574 at 589 per Sackville J. But those purposes, no matter how broadly expressed, impose some constraint.
42 Section 155 of the 1974 Act is constrained by reference to the requirement that there be reason to believe that the documents sought relate to a matter that may constitute a contravention of the Act - again, the validity of a notice requiring the production of information apparently totally unrelated to any possible contravention of the 1974 Act may be at least questioned. And s 77C is confined (at least to some extent) by the reference to the documents relating to a matter connected with the performance of the functions of the Official Receiver or a trustee.
43 After referring to Pyneboard and other decisions of the Full Court of this Court, in Australian Securities Commission v Lucas (1992) 36 FCR 165. Drummond J summarised the position in respect to notices issued under s 155 as follows:
… so far as form is concerned, a notice issued under s 155 of the Trade Practices Act to be valid must contain the following information:
(a) it must disclose on its face sufficient information to identify the "matter" with respect to which the recipient of the notice is thought to be capable of giving information, evidence or producing documents; and
(b) the notice must contain sufficient information to disclose the necessary relationship between the information or documents sought and the matter in respect of which that material is sought.
This has been described as the "entitlement disclosure condition": S A Brewing Holdings Ltd v Baxt (1989) 23 FCR 357 at 370 per Fisher and French JJ.
44 But s 29 is not likewise constrained. The functions vested in the Commission by s 7A are so diverse that any field of personal or business activity may potentially fall within its reach. A person served with a notice under s 29 may not have any knowledge that any "special ACC operation/investigation" is being undertaken and may have even less knowledge as to either the information available to the Commission exposing his own involvement or participation in any such operation or investigation. There may be good reason to keep such information confidential to the Commission. Both those persons who are improperly pursuing an activity of legitimate concern to the Commission and those persons who are completely innocent may have "a document or thing" which could be relevant to the tasks entrusted to the Commission. A person upon whom a notice has been served may immediately realise or suspect why the Commission is requesting that the "document or thing" be produced; others may have no knowledge. But how or why a "document or thing" is required to be produced may not be able to be tested by reference to such other criteria as there is in other statutory contexts - for example, the document being a financial record potentially of relevance to income or the recovery of tax; or a corporate record potentially of relevance to a contravention of the Trade Practices Act.
45 Whatever may be the degree of knowledge of the person upon whom a notice under s 29 has been served, any notice must be construed according to its terms. The express legislative constraint imposed by s 29 which is invoked by the present Applicants is the requirement that the notice "specify" that which is required to be produced.
46 Further support for construing the term "specified" in s 29 as requiring a particular degree of detail, and perhaps a greater degree of particularity than is required in other statutory contexts, is provided by s 22 of the 2002 Act. That section authorises the issue of a search warrant. And s 22(2) provides as follows:
Where an application under subsection (1) is made to an issuing officer, the issuing officer may issue a warrant authorizing a member of the Australian Federal Police or of the Police Force of a State, or any other person, named in the warrant, with such assistance as he or she thinks necessary and if necessary by force:
(a) to enter upon the land or upon or into the premises, vessel, aircraft or vehicle;
(b) to search the land, premises, vessel, aircraft or vehicle for things of the relevant kind; and
(c) to seize any things of the relevant kind found upon the land or upon or in the premises, vessel, aircraft or vehicle and deliver things so seized to any person participating in the special ACC operation/investigation.
Subsection (2) does not authorise the issue of a warrant confined to the seizure only of "specified things". The degree of detail required to be set forth in a warrant is that provided for in s 22(5) which provides as follows:
A warrant issued under this section shall:
(a) include a statement of the purpose for which the warrant is issued, which shall include a reference to the special ACC operation/investigation and with which the things of the relevant kind are connected;
(b) state whether entry is authorized to be made at any time of the day or night or during specified hours of the day or night;
(c) include a description of the kind of things authorized to be seized; and
(d) specify a date, not being later than one month after the date of issue of the warrant, upon which the warrant ceases to have effect.
Subsection 5(c) likewise does not employ the language of "specified" things. In that respect, s 22 may provide a greater degree of latitude in the language permitted to identify the things that may be seized. Perhaps in the case of a search warrant a greater confidence is reposed in those executing the warrant to seize only that which is authorised. A warrant once having been issued, it is thereafter those executing the warrant who make the decisions as to what they may lawfully seize. In the case of a notice issued pursuant to s 29 it was evidently considered appropriate by the legislature to impose upon the person served with such a notice less room for ambiguity and a greater degree of precision as to that which he was required to produce. But why a search warrant is required to contain a "statement of the purpose for which the warrant is issued" (s 22(5)(a)), and why there is no such like requirement in the case of a s 29 notice, was not explained by Counsel for the Commission.
47 The degree of care with which provisions such as s 22 have been drafted is obvious. At common law, for example, a police officer who was lawfully upon premises had a limited ability to seize that which he believed was evidence of a crime: Elias v Pasmore [1934] 2 KB 164. It was said that "the interests of the State must excuse the seizure of documents, which seizure would otherwise be unlawful, if it appears in fact that such documents were evidence of a crime committed by anyone": [1934] 2 KB at 173. Other decisions limited this power to seize to only those materials which implicated the occupier in the same offence as that for which an arrest was being made or the seizure of those documents which implicated some other person in the same offence as that for which a search warrant had been issued: Ghani v Jones [1970] 1 QB 693 at 706; Butler v Board of Trade [1971] Ch 680 at 691; G H Photography Pty Ltd v McGarrigle [1974] 2 NSWLR 635 at 644 to 645; Adamson v Noall [1967] VR 105 at 115. Whatever be the extent of the power conferred at common law, s 22(7) now confers the following power:
Where, in the course of searching, in accordance with the terms of a warrant issued under this section, for things of the relevant kind, the person executing the warrant finds a thing that he or she believes on reasonable grounds to be evidence that would be admissible in the prosecution of a person for an offence against a law of the Commonwealth, of a State or of a Territory, and he or she believes on reasonable grounds that it is necessary to seize the thing in order to prevent its concealment, loss, mutilation or destruction, or its use in committing such an offence, the person may seize the thing and, if he or she does so, the thing shall be deemed, for the purposes of this Act, to have been seized pursuant to the warrant.
The concern of those drafting the Act was to ensure that the power of the Commission and its officers was clear. That which will require clarification in the future are the rights of those against whom the power is invoked.
48 But the present proceedings, it is considered, do not require any detailed consideration to be given to how specific or definite a description has to be.
49 The present notice may suffer from limited ambiguity; but such ambiguity as there may be provides no basis for concluding that any of the notices are not authorised by the terms of s 29 by reason of the uncertainty asserted. None of the documents or categories of documents required to be produced pursuant to the notice are anything other than well recognised documents or categories of documents. The identification of documents by reference to their being "corporate records" or "financial statements" (for example) is readily capable of being given meaning. The use of terms such as "directly or indirectly" is equally as readily capable of being given an acceptably certain meaning.
50 It is also of some relevance that in communications and correspondence as between the Applicants and the Commission there was no prior assertion that there was any uncertainty on the part of the Applicants as to the documents required to be produced. Specificity in language may have regard to the knowledge of the person upon whom a notice is served: cf The Integrated Financial Group Pty Ltd v Australian Securities and Investments Commission [2004] WASCA 213, 187 FLR 7. The "clarity" of a notice served under s 264 of the 1936 Act, it has been said, "must be considered against the background of the knowledge and circumstances of the Respondent to the Notice and the contextual facts": Hart v Commissioner of Taxation [2005] FCA 1748 at [91], 148 FCR 198 at 226 per Greenwood J. A document may be specified if the description of the document required to be produced is sufficiently certain to identify it to the person upon whom a notice is served - even if that description may mean little (if anything) to a person without such knowledge.
51 The Applicants in the present proceedings, it is considered, are more intent on attempting to find uncertainty where - upon a reasonable and practical reading of the Schedules - none exists.