Commissioner of the Australian Federal Police v McGlone

Issue on the appeal

1. The central issue on the appeal was whether the primary judge erred in the exercise of his discretion in refusing to make the examination orders sought prior to the criminal trial: House v R [1936] HCA 40; 55 CLR 499.
2. The Commissioner contended that it would not be a proper exercise of the discretion conferred under the Act to refuse to make an order that the respondents be examined for the reason only that criminal proceedings were on foot and there would be an overlap of the subject matter of the examination and the evidence which was to be adduced in the criminal trial.
3. The Commissioner contended that the primary judge erred as he refused to make orders on that basis only. This error was also asserted in positive terms, namely, that the effect of his Honour's decision was that the Act required a stay to be granted in the interests of justice if criminal proceedings were on foot.

The legislation

1. The Act is, inter alia, an Act to provide for the confiscation of proceeds of crime: s 5(a). The scheme of the Act is explained in s 6, as follows: "6 General This Act establishes a scheme to confiscate the proceeds of crime. It does this by: (a) setting out in Chapter 2 processes by which confiscation can occur; and (b) setting out in Chapter 3 ways in which Commonwealth law enforcement agencies can obtain information relevant to these processes; and (c) setting out in Chapter 4 related administrative matters. It concludes with miscellaneous provisions and with definitions and other interpretive material."
2. The scheme provides, by Ch 2, for the making of restraining orders: Pt 2-1; and for the making of forfeiture orders: Pt 2-2. Chapter 3 of the Act provides for information gathering, including, in Pt 3-1, for compulsory examinations. Section 180, with which the present appeal is concerned, provides: "180 Examination orders relating to restraining orders (1) If a restraining order is in force, the court that made the restraining order, or any other court that could have made the restraining order, may make an order (an examination order) for the examination of any person, including: (a) a person whose property is, or a person who has or claims an interest in property that is, the subject of the restraining order; or (b) a person who is a suspect in relation to the restraining order; or (c) the spouse or de facto partner of a person referred to in paragraph (a) or (b); about the affairs of a person referred to in paragraph (a), (b) or (c). (2) The examination order ceases to have effect if the restraining order to which it relates ceases to have effect."
3. The "affairs" of a person are defined non-exhaustively in the dictionary to the Act, in s 338, to include: "(a) the nature and location of property of the person or property in which the person has an interest; and (b) any activities of the person that are, or may be, relevant to whether or not the person has engaged in unlawful activity of a kind relevant to the making of an order under this Act."
4. Section 183 provides, relevantly: "183 Examination notices (1) An approved examiner may, on application by the responsible authority, give to a person who is the subject of an examination order a written notice (an examination notice) for the examination of the person. (2) However, the approved examiner must not give the examination notice if: (a) an application has been made under section 42 for the restraining order to which the notice relates to be revoked; and (b) the court to which the application is made orders that examinations are not to proceed. (3) The fact that criminal proceedings have been instituted or have commenced (whether or not under this Act) does not prevent the approved examiner giving the examination notice. Approved examiners (4) An approved examiner is a person who holds an appointment under this section. (5) The Minister may appoint as an approved examiner: (a) a person who holds an office, or is included in a class of people, specified in the regulations; or (b) a person who: (i) is enrolled as a legal practitioner of the High Court, of another federal court or of the Supreme Court of a State or Territory; and (ii) has been so enrolled for at least 5 years; and (iii) has indicated to the Minister that the person is willing to be appointed."
5. The Proceeds of Crime Regulations 2002 (Cth) (the Regulations), reg 12 provides: "12 Approved examiners (1) For paragraph 183(4)(a) [sic: (5)(a)] of the Act, the class of people specified is the class that includes a person: (a) to whom subregulation (2) applies; and (b) whose name is on a register kept by the Minister for the purposes of section 183 of the Act. (2) This subregulation applies to the following persons: (a) a person who is: (i) a presidential member of the Administrative Appeals Tribunal established under the Administrative Appeals Tribunal Act 1975; or (ii) a non‑presidential member of that Tribunal who is enrolled as a legal practitioner of the High Court, of another federal court or of the Supreme Court of a State or Territory, and has been so enrolled for at least 5 years; (b) a person who has held the office of judge in the Supreme Court, District Court or County Court of a State or Territory and has stated, in writing, that he or she is willing to be an approved examiner; (c) a person who has held the office of magistrate and has stated, in writing, that he or she is willing to be an approved examiner."
6. Section 186(4) provides: "(4) The fact that criminal proceedings have been instituted or have commenced (whether or not under this Act) does not prevent the examination of a person."
7. Section 187(5) provides: "(5) The approved examiner may require the person to answer a question that: (a) is put to the person at the examination; and (b) is relevant to the affairs of a person whose affairs can, under section 180, 180A, 180B, 180C, 180D, 180E or 181, be subject to the examination."
8. Section 188 provides: "188 Examination to take place in private (1) The examination is to take place in private. (2) The approved examiner may give directions about who may be present during the examination, or during a part of it. (3) These people are entitled to be present at the examination: (a) the approved examiner; (b) the person being examined, and the person's lawyer; (c) the responsible authority; (d) any person who is entitled to be present because of a direction under subsection (2)."
9. Section 193 provides: "193 Approved examiner may restrict publication of certain material (1) The approved examiner may: (a) on his or her own initiative; or (b) at the request of the person being examined, or the responsible authority; give directions preventing or restricting disclosure to the public of matters contained in answers given or documents produced in the course of the examination. (2) In deciding whether or not to give a direction, the approved examiner is to have regard to: (a) whether: (i) an answer that has been or may be given; or (ii) a document that has been or may be produced; or (iii) a matter that has arisen or may arise; during the examination is of a confidential nature or relates to the commission, or to the alleged or suspected commission, of an offence against a law of the Commonwealth or a State or Territory; and (b) any unfair prejudice to a person's reputation that would be likely to be caused unless the approved examiner gives the direction; and (c) whether giving the direction is in the public interest; and (d) any other relevant matter."
10. A person is guilty of an offence if, having been required to attend an examination, that person refuses or fails to do so: s 195. Pursuant to s 196, a person attending an examination must not refuse or fail to be sworn or affirmed or to answer a question required to be answered by the approved examiner or to produce documents specified in the examination notice. The section provides for a penalty of imprisonment for two years or 120 penalty units or both.
11. Section 197(2) abrogates the privilege against self-incrimination and legal professional privilege in respect of examinations under the Act.
12. Section 198 provides for direct use immunity in civil or criminal proceedings in respect of any answer given, or document produced, in an examination, as follows: "198 Admissibility of answers and documents An answer given or document produced in an examination is not admissible in evidence in civil or criminal proceedings against the person who gave the answer or produced the document except: (a) in criminal proceedings for giving false or misleading information; or (b) in proceedings on an application under this Act; or (c) in proceedings ancillary to an application under this Act; or (d) in proceedings for enforcement of a confiscation order; or (e) in the case of a document - in civil proceedings for or in respect of a right or liability it confers or imposes."
13. Section 266A provides that information obtained in the course of an examination may be disclosed to certain authorities for specified purposes. Those authorities include the Commonwealth Director of Public Prosecutions, the prosecutor in the criminal proceedings in this matter. Pursuant to s 266A(2), disclosure to such an authority may be made for the purpose of: "Assisting in the prevention, investigation or prosecution of an offence against that law that is punishable on conviction by imprisonment for at least 3 years or for life."
14. Sections 266A(3)-(4) provide for direct use immunity in respect of information that is disclosed under s 266A, with the same exceptions as those in s 198.
15. Proceedings on an application for a restraining order or a confiscation order are not criminal proceedings: s 315(1). Section 315(2) provides, inter alia, that in such proceedings, the rules of evidence applicable in civil proceedings apply.
16. Section 317 provides for the onus and standard of proof in proceedings under the Act, as follows: "317 Onus and standard of proof (1) The applicant in any proceedings under this Act bears the onus of proving the matters necessary to establish the grounds for making the order applied for. (2) Subject to sections 52 and 118, any question of fact to be decided by a court on an application under this Act is to be decided on the balance of probabilities."
17. Section 319, at the time of the application before the primary judge, was in the following terms: "The fact that criminal proceedings have been instituted or have commenced is not a ground on which a court may stay proceedings under this Act that are not criminal proceedings."
18. It is convenient to deal with the case against Mr McGlone and Mr McKell separately from that against Mrs McKell, whose position is different in that she has not been charged with an offence.

Trial judge's reasons

1. The trial judge, at [42], determined, in the exercise of his discretion, to postpone the making of an examination order in respect of Mr McKell and Mr McGlone until the first day of the 2016 law term, when, on the information before his Honour, the criminal trial would have concluded. His Honour gave 15 reasons for reaching that determination, in "generally descending order of significance".
2. In summary form (and maintaining his Honour's numbering), those reasons were as follows: 1. A significant portion of the questioning of the respondents at the examination would be about the precise subject matter with which they are charged, and that would occur in circumstances in which the respondents would enjoy no derivative use immunity with regard to answers they would be compelled to give. 2. The fact that the Act abrogates the right to silence and the privilege against self-incrimination and compels answers to questions in the absence of derivative use immunity does not preclude the exercise of the discretion to postpone an examination in the particular circumstances of this case. 3. There was no practical prejudice to the Commissioner if the examinations were postponed. This was principally because the cash that had been found at the premises of Mr McGlone and Mr McKell had been seized and was in the Commissioner's possession. Although the objects of the Act would be thwarted for the period of the postponement, that was not practical prejudice. 4. The need to retain the characteristics of a criminal trial as understood within the Australian system of justice. 5. In Commissioner of the Australian Federal Police v Zhao [2015] HCA 5; 255 CLR 46 (Zhao) proceedings under Pt 2.2 were postponed until after the resolution of a criminal trial on the same subject matter. In an examination under s 180, unlike one under Pt 2.2, the person examined is compelled to give evidence, such that the reasoning in Zhao applies with more force. 6. Zhao did not otherwise require a distinction to be drawn between an examination under the Act on the one hand and forfeiture proceedings on the other. 7. Lee v New South Wales Crime Commission [2013] HCA 39; 251 CLR 196 (Lee (No 1)) was concerned with whether there was a power to grant a stay or postponement of an examination and was not authority precluding the exercise of the discretion conferred by s 180 from being exercised in favour of a respondent in the present circumstances. 8. Lee (No 1) was further to be distinguished on the basis that the Criminal Assets Recovery Act 1990 (NSW), in issue in that case, made provision for examinations to be conducted before a Registrar, who could exercise the powers of the Supreme Court to limit the examination as appropriate. In contrast, an examination under s 180 of the Act is conducted by an "approved officer" who is not necessarily a judicial officer of a superior court. 9. Section 180 conferred a discretion as to whether to make an order, and if so when, in the context of an Act which otherwise abolishes discretion and evaluative judgments in a number of respects. 10. Section 319, relating to stays of proceedings under the Act, applied to forfeiture and exclusion hearings as well as to examinations under s 180. In Zhao, the High Court approached s 319 on the basis that it did not preclude the adjournment of a forfeiture or exclusion hearing, which suggested that an adjournment of an examination was also not precluded. 11. In the absence of derivative use immunity, the prejudice to an accused from potential derivative use of material obtained during an examination was obvious and postponement on the basis of that prejudice did not require the formality of affidavit evidence. 12. Once the Crown had proved the possession of the monies the subject of the s 400.9 charges, Mr McGlone and Mr McKell each bore the onus of proving that he had no reasonable grounds for suspecting that the money was derived or realised, directly or indirectly, from the commission of an indictable offence. 13. It was not appropriate to defer consideration of postponing the examination to the examiner. 14. The imminence of the trial and the likely disruption to trial preparation caused by the examination. 15. The lack of urgency with which the Commissioner had moved the Court for the order.

Commissioner's submissions: case against Mr McGlone and Mr McKell

1. The Commissioner's principal argument in respect of Mr McGlone and Mr McKell was that once it was understood that the Act authorises the examination of a person who is the subject of extant criminal proceedings about the subject matter of those proceedings, it was not open in the exercise of the discretion conferred by s 180 not to order an examination for the sole reason that criminal proceedings were pending. This was so notwithstanding that it was likely that the evidence traversed at the examination would overlap with evidence that would be tendered at trial and notwithstanding that the legislature had determined not to provide for derivative use immunity in respect of evidence given in the examination. The overall submission was that: "It cannot be in the interests of justice not to order an examination to in effect recalibrate the very matters that the Commonwealth Parliament has said are impacted upon by this legislation, which … is meant to have blunt force in relation to dealing with serious matters."
2. The Commissioner submitted that, properly analysed, the reasons articulated by his Honour for not making the order condensed to three essential factors. First, Mr McKell and Mr McGlone had been charged with offences and Mrs McGlone was possibly to be the subject of charges. Secondly, the questions in the examinations would cover the subject matter of the charges. Thirdly, whilst the Act provided an immunity from direct use of answers given in the examination in the respondent's criminal trial, they were exposed to derivative use such that, in order to preserve the traditional characteristics of a criminal trial, an order for examination should not be made prior to the trial.
3. The Commissioner contended that, taken in the context of the Act, which inter alia, provided for direct use immunity but made no provision for derivative use immunity, these three factors were merely an aspect of the fact that a criminal trial was pending at the time that the Commissioner sought the order for the examinations. The Commissioner submitted that his Honour erred, therefore, because the essential matters upon which he relied were the very matters that were contemplated by the Act.
4. In amplification of that contention, the Commissioner identified the following alleged errors: 1. his Honour ought to have found that Lee (No 1) and particularly the comments of Gageler and Keane JJ at [388] militated against the exercise of his discretion to refuse to make orders under s 180; 2. his Honour erred in considering that the fact that examiners appointed under s 183(4) of the Act were not judicial officers was a further point of distinction from Lee (No 1) and weighed against the making of an order under s 180; 3. his Honour erred in considering that Zhao dictated or at least weighed against ordering the examinations; 4. his Honour ought to have found that the considerations upon which the respondents based their claim of prejudice were to the same effect as those which were rejected by this Court in New South Wales Crime Commission v Lee [2012] NSWCA 276; 84 NSWLR 1 (NSWCC v Lee); 5. his Honour erred in considering it relevant that the Commissioner was not prejudiced by postponing the making of an order; and 6. his Honour erred in failing to find that there was no or insufficient evidence to establish a risk of prejudice to Mr McGlone or Mr McKell by the proposed examinations.

The question of undertakings

1. Before considering each of the alleged errors identified by the Commissioner, one further matter needs to be mentioned. The Commissioner had not, at the time of the hearing before the primary judge, given an undertaking to restrict the disclosure to the Commonwealth Director of Public of Prosecutions of any information referable to the charges against the respondents obtained upon examination. The Commissioner submitted that no such undertaking was required by the provisions of the Act. This is correct: see s 266A. However, there may, in a given case, be a question whether the giving of such an undertaking is relevant to the exercise of the discretion under s 180.
2. Subsequently, in submissions filed with the leave of the Court after the conclusion of the hearing, the Commissioner acknowledged that in this case, it was appropriate to impose the following conditions upon the conduct of any examination: "(a) no person involved in the investigation or prosecution of the offences of which the first and second respondents are charged be present during the examination …; and (b) the transcript of the examination, any matter contained in answers given during the course of the examination and documents produced at the examination insofar as they relate to the circumstances of the offences with which the first and third respondents are charged not be disclosed to any person involved in the investigation or prosecution of the offences with which the first and second respondents are charged …"
3. However, as the Commissioner had not proposed this course in the proceedings before his Honour, it will only become necessary to consider whether any conditions should be imposed in respect of the examinations, and if so, what they should be, if error is established in the primary judge's determination and this Court determines that it is appropriate to re-exercise the discretion.

Respondents' submissions: Mr McGlone and Mr McKell

1. The respondents' primary submission was that, notwithstanding that the Act authorises compulsory examination in circumstances in which the subject matter of the examination will overlap with that of a pending criminal trial, the court is not precluded from considering that circumstance in the exercise of its discretion whether or not to order the examination. The respondents contended that each of the factors upon which the primary judge relied were relevant to the exercise of that discretion, and that the weight to be given to each factor was a matter for the primary judge, in respect of which this Court should be slow to interfere.

Did his Honour misapply Lee (No 1)?

1. In his seventh reason, identified above at [38], his Honour stated that Lee (No 1) was concerned with the question of whether there was power to conduct an examination notwithstanding that criminal proceedings were pending. His Honour pointed out that the question for his determination, in contrast, was whether he was precluded from exercising his discretion in favour of a respondent by not ordering an examination. His Honour considered that that question was not governed by Lee (No 1).
2. Lee (No 1) involved an application by the New South Wales Crime Commission for the examination of the appellants in that case pursuant to s 31D of the Criminal Assets Recovery Act. The Criminal Assets Recovery Act contained provisions for the abrogation of the privilege against self-incrimination and for direct use immunity, but did not protect against derivative use of information obtained at an examination. To that extent, it contained similar provisions to the Proceeds of Crime Act. Further, s 63 of the Criminal Assets Recovery Act was in the same terms as s 319 of the Proceeds of Crime Act (in its form at the time the application in this matter was determined). On the express terms of the section, the fact of criminal proceedings having been instituted or commenced was not a ground upon which a court "may stay proceedings" under the Act.
3. At the time the Commissioner applied for an order for examination in Lee (No 1), criminal proceedings were pending against the appellants in that case. The High Court, by majority, held that the Supreme Court had power to order an examination notwithstanding that criminal proceedings had been brought against the proposed examinee: per French CJ at [55]; Crennan J at [144]; Gageler and Keane JJ at [331]. This is what the primary judge said in his seventh reason and there was no error in his Honour's understanding of that aspect of the decision.
4. The Commissioner contended, however, that his Honour erred in distinguishing Lee (No 1) on the basis that it dealt only with whether there was power to order an examination whilst criminal proceedings were pending and that his Honour should have applied the observations of Gageler and Keane JJ, in relation to the discretionary exercise of that power.
5. It had been argued in the High Court that, in the decision under appeal: New South Wales Crime Commission v Lee [2012] NSWCA 276; 84 NSWLR 1 (NSWCC v Lee), this Court had wrongly construed the examination power under s 31D: "… as requiring the Supreme Court to determine an application for an examination without taking into account the risk such an examination may pose to a pending criminal trial." Gageler and Keane JJ, at [336], found that the Court of Appeal had not construed the section in that way.
6. Importantly, their Honours, at [337], accepted that "the circumstances of the case, other than the mere pendency of a criminal trial" were to be taken into account so as to ascertain whether there was "a real, as opposed to a speculative or theoretical risk, that the administration of justice would be adversely affected" if an order was made. Their Honours observed that the exigencies of criminal proceedings might well afford a ground for the refusal to make an order for examination. Their Honours instanced the possibility that an examination might disrupt the preparation for or conduct of an imminent criminal trial as being a relevant circumstance that might lead to the discretionary refusal of an order for examination prior to a criminal trial: see also my observation in NSWCC v Lee at [10].
7. Their Honours then stated, at [338], in the passage upon which the Commissioner placed particular reliance: "The discretion conferred on the Supreme Court by s 31D(1)(a) must be exercised consistently with the scheme of the [Criminal Assets Recovery Act]. The discretion would not be exercised consistently with the scheme of the [Criminal Assets Recovery Act] were the Supreme Court to decline to make an order under s 31D(1)(a) by reference only to circumstances in respect of which s 63 would prevent the making of an order staying proceedings on the application for an order under s 31D(1)(a)." (emphasis added)
8. It is important to recognise that the emphasised portion of [338] is not a statement of principle that any risk an examination might pose to the character of a pending criminal trial cannot be taken into account in the exercise of the discretion. So much is clear not only from their Honours' use of the word "only" in the reference to the circumstance outlined in s 63, but also from their reference in [337] to the "mere pendency" of the criminal trial, and from their finding at [336] that the NSW Court of Appeal had not erroneously construed the section as had been asserted.
9. It is true, as the primary judge in this case observed at [66], that no clear majority position on the exercise of the discretion emerges from the judgments in Lee (No 1). However, the observations of Gageler and Keane JJ in respect of the exercise of the discretion are persuasive and neither French CJ nor Crennan J demurred from them. Their Honours' silence does not of course denote agreement. However, the observations of Gageler and Keane JJ reflect the principles underpinning the exercise of a judicial discretion and were thus consistent with the comments of French CJ [55] and Crennan J at [141] that the discretion whether to order an examination was to be exercised judicially.
10. It follows from the comments of Gageler and Keane JJ that the question for consideration in a given case is whether there are circumstances going beyond the mere pendency of a criminal trial which reveal a real as opposed to a speculative or theoretical risk to the administration of justice in the conduct of that trial.
11. If, as appears to be the case, the primary judge considered the observations of Gageler and Keane JJ relating to the exercise of the discretion to be irrelevant, then for the reasons I discuss later in these reasons, I do not consider that that is an error that affects the outcome. I should also mention that the primary judge's comment at [63] that Gageler and Keane JJ were of the opinion that there was no power to refuse to conduct an examination with regard to the same subject matter as pending criminal charges is either inaccurate, reflecting a typographical or proofing error, or incomplete. Even assuming error on that point, then, for the same reasons as I give in relation to his Honour's exercise of the discretion under s 180, I do not consider it to be an error that affects the outcome of the appeal.

Did his Honour err in his consideration of the characteristics of an "approved examiner"?

1. In his eighth reason, the primary judge considered that an important aspect of the reasoning in Lee (No 1) was that the examination in question in that case was conducted by a judicial officer, who could engage the powers of the court to limit the examination as appropriate. By contrast, his Honour pointed out that under the Act, the examination was conducted by an approved examiner: see s 183 and the Regulations, reg 12.
2. The fact that examinations under the Criminal Assets Recovery Act were conducted before registrars was adverted to in Lee (No 1): see at [56] per French CJ; [141] per Crennan J; [340] per Gageler and Keane JJ; see also NSWCC v Lee at [81] per Basten JA and [101] per Meagher JA. French CJ considered that factor was relevant in the context of the principle of legality as that principle informed the construction of the Criminal Assets Recovery Act. Crennan J, at [141], considered that the fact that an examination was conducted by a judicial registrar was relevant to the question of prejudice to the person to be examined. As her Honour stated: "The grant of powers to the Supreme Court to make restraining orders and confiscation orders, and examination orders ancillary to either, confers on the Supreme Court powers to be exercised judicially, in accordance with legal principle, and so as to diminish the possibility of oppression and injustice in any examination."
3. The Commissioner contended that the trial judge misapplied Lee (No 1) by drawing a distinction between an examination by a registrar and an examination by an approved examiner. The Commissioner, in argument in this case, pointed out that examiners under the Act were presidential members of the Administrative Appeals Tribunal, non-presidential members of that Tribunal who were enrolled as legal practitioners, or those who have served as judges or magistrates: r 12(2). Those persons have the powers under s 187(5) of the Act as to whether to require an examinee to answer questions. The Commissioner contended that in exercising that power, the examiners might be expected to weigh the impact of the examination on the criminal trial and to limit an examination to its proper purpose. He drew support for that proposition from Lee v DPP at [69] where Basten JA made reference to the powers of an examiner under the Act in the following terms: "… the approved examiner, in considering the exercise of their powers will no doubt be invited to have regard to the fact that the Act does not permit a person to decline to answer questions on the basis of the privilege [against incrimination]. However, an offence is committed only where the person refuses or fails to answer a question 'that the approved examiner requires the person to answer': s 196(1)(b). How widely the approved examiner would permit the examination to go, in exploring matters which might be relevant primarily to the person's defence, is a further unknown. The intervention of the court to pre-empt all of these decision-making powers being exercised, should only be contemplated where there is some basis for concluding that there would otherwise be an abuse of process. The statute is inconsistent with the proposition that an abuse of process necessarily arises merely because there are outstanding charges pending or because there is the possibility that charges may later be laid."
4. The Commissioner also made reference to the observation of Basten JA in NSWCC v Lee at [81] in relation to an examination by a registrar, that: "The possibility that an examination at this stage could interfere with the trial of the respondent Jason Lee, which is apparently listed for hearing in October, and the possible retrial of both in respect of the drug supply charges, is speculative. If a real risk of prejudice is revealed in the course of the conduct of the examination, there is no reason to suppose that the registrar before whom the examinations take place will not have powers available to diminish or prevent that prejudice, to the extent that it is beyond the prejudice authorised by the Criminal Assets Recovery Act."
5. The Commissioner contended, therefore, that in a practical sense, the position would be no different under the Act than was found to be the case in Lee (No 1) and NSWCC v Lee under the Criminal Assets Recovery Act.
6. The Commissioner also submitted that the proposition that examinations of the respondents could interfere with Mr McGlone's and Mr McKell's respective preparations for their criminal trial was speculative and that the examiner could, and would be expected to, conduct the examination such that there was no real risk of prejudice to them.
7. Although there are important points of distinction between an officer acting judicially and a person carrying out administrative functions, there is merit in the Commissioner's reliance on the powers of an approved examiner to control the conduct of the examination. In the circumstances, this basis upon which his Honour distinguished Lee (No 1) may not have been a relevant one, or at least a distinction that had any practical effect. However, again, for the reasons I give below, I do not consider that this is a matter that is determinative of the question whether his Honour erred in the exercise of the discretion under s 180.

Did his Honour misapply Zhao?

1. The primary judge's fifth, sixth and tenth reasons were concerned with the High Court's decision in Zhao.
2. In Zhao, the High Court was concerned with the exercise of the discretion to order an examination in circumstances where the Commissioner had made an application for orders for forfeiture of property. At the time the forfeiture proceedings were brought, the criminal trial of the second respondent, Mr Jin, in respect of offences of dealing with money or property alleged to be the proceeds of crime contrary to the provisions of the Criminal Code, was pending. The first respondent, Mrs Zhao, had not been charged with an offence, but was the registered proprietor of the residential property that was the subject of the forfeiture proceedings.
3. The matters relevant to the forfeiture proceedings were substantially identical to the matters in issue in the criminal proceedings. The respondents filed applications seeking the exclusion of certain property from the restraining order and from forfeiture. They also made an application for a stay of the forfeiture and exclusion proceedings until after the completion of the criminal proceedings against the second respondent.
4. Mr Jin filed an affidavit in support of the stay application in which he stated he was concerned that if he was required to give evidence in the forfeiture proceedings or if he was cross-examined regarding the purchase of the restrained property and the source of other relevant funds, there was a real risk that any such evidence would prejudice his criminal case. He stated that any evidence he would be required to give to properly present his case in the forfeiture and exclusion proceedings would be directly relevant to the criminal charges. He also stated that if he were to give any such evidence, he would, in effect, be waiving his right to silence in his criminal trial and he did not wish to do so.
5. The judge at first instance refused the stay. His Honour's decision was reversed on appeal. The Commissioner appealed to the High Court. The question for determination in Zhao in the High Court, as identified at [19], was: "… whether the second respondent should be placed in a position where he must decide whether to prejudice his criminal trial or his defence of the forfeiture proceedings and his case in the exclusion proceedings."
6. The Court stated, at [30], that s 319 of the Act clearly contemplated that where criminal proceedings related to proceedings under the Act were brought, an application for a stay of forfeiture or restraining orders could be made. Importantly, however, the Court stated that the terms of s 319 suggested that a person seeking a stay "must do more than point to the existence of criminal proceedings" in order to obtain the stay.
7. Their Honours, at [34], accepted the Commissioner's submission that the Act contemplated that restraining and forfeiture orders may be made regardless of whether a person was charged with an offence that had some connection with the forfeiture proceedings. Their Honours concluded on this point that: "… the fact that criminal proceedings have been brought may generally be considered not to be an impediment to the continuation of the forfeiture proceedings."
8. Their Honours continued that to grant a stay of forfeiture proceedings, it was not sufficient that related charges had been brought and criminal proceedings were pending. Rather, as their Honours reiterated, at [35], "more was required". In order for a stay of forfeiture proceedings to be ordered: "… it must be apparent that the person whose property is in question is at risk of prejudice in the conduct of his or her defence in the criminal trial." (emphasis added)
9. There are observations made at [36], to the effect that it was implicit in s 319 that the courts have a power to control their own proceedings and to order a stay in an appropriate case, namely, "where the interests of justice require such an order". Their Honours also stated that s 319 was not expressed so as to refer specifically to circumstances where the issues in the forfeiture proceedings and the criminal proceedings were substantially identical. As their Honours stated, "the [Act] does not presume to say what a court should do in such a circumstance".
10. Their Honours, at [37], accepted that the Act operated in such a way that a person the subject of criminal proceedings was effectively required to elect whether or not to defend the forfeiture proceedings, an election to defend such proceedings effectively requiring the person to give evidence and thus impliedly waiving that person's right to silence in respect of the criminal proceedings. However, their Honours did not accept that every person in that position had to proceed to make their choice regardless of the risk of prejudice to their defence. Rather, their Honours stated that whether "the forfeiture proceedings continue is a matter for the court to consider in the interests of justice".
11. At [38]-[39], the High Court found that there was no basis in the Act upon which to draw the implication that forfeiture proceedings should, at least ordinarily, continue at all costs.
12. At [42] ff, their Honours dealt with the question whether the primary judge had erred in refusing a stay of the forfeiture and exclusion proceedings. Their Honours considered that the risk of prejudice to the second respondent was plain if a stay was not granted, given that the offences and circumstances relevant to both proceedings were relevantly identical. Their Honours stated that it was unnecessary for the respondent to say more than was in his affidavit to identify the risk, as to do so would require him to reveal information about his defence, so that the risk of prejudice would become a reality.
13. A question also arose in Zhao as to the operation of s 266A, which permits the disclosure of information obtained in an examination to prosecuting authorities, subject to a direct use immunity. The Commissioner in his submissions in Zhao emphasised that he did not consider that s 266A gave him a licence to release material and did not consider himself an arm of the prosecuting authorities. The High Court observed, however, at [46], that: "… it would not be correct to approach a matter such as this on the basis that a wrong would be committed. However, s 266A would not render the provision of the second respondent's evidence to the prosecution unlawful. Even if it could not be used as evidence against him, its possession by the prosecution might affect his defence. The Court of Appeal's view, that protective orders would not suffice to remove the risk of prejudice to the second respondent's defence, is clearly correct."
14. The Court concluded: "47 The prospect that civil proceedings may prejudice a criminal trial and that such prejudice may require a stay of the civil proceedings is hardly novel … The risk of prejudice in a case such as this is real. The second respondent can point to a risk of prejudice; the Commissioner cannot. … 49 It may be accepted that criminal proceedings are not an impediment to civil proceedings under [the Act], but it does not follow that it is intended that forfeiture proceedings brought under [the Act] will continue where to do so would put a respondent at risk of prejudice in his or her criminal trial. 50 The interests of justice are not served by requiring the second respondent to defend the forfeiture proceedings or pursue the exclusion proceedings before his criminal proceedings are finalised, especially since the Commissioner will suffer no relevant prejudice from a delay in the continuation of the forfeiture proceedings."

Zhao: Commissioner's submissions

1. As noted above, the primary judge considered, in his fifth and sixth reasons, that Zhao weighed against the granting of an order under s 180. His Honour considered that the High Court's reasoning was not confined to forfeiture orders but applied with "more force" to examination orders, given that an examinee is compelled to answer questions.
2. The Commissioner submitted that the primary judge erred in this approach and that there were significant and critical differences between forfeiture and examination proceedings, such that Zhao should be distinguished. He identified those differences as follows: 1. The right to silence and the privilege against self-incrimination are expressly abrogated for examination proceedings, but not for forfeiture proceedings. 2. Examinations were designed to compulsorily secure information in order, inter alia, to investigate the source of and to trace proceeds of crime, including their reinvestment. 3. Forfeiture proceedings are normally heard in open court. In contrast, examinations are held in private: s 188; and there are specific powers that permit the examiner to control the disclosure to the public of information obtained during an examination: s 193. 4. The Act provides for direct use immunity in respect of answers or documents obtained in the course of an examination: s 198. Direct use immunity does not apply to forfeiture proceedings other than to a respondent's sworn statement of assets: s 39A, or to disclosure under s 266A. 5. Although the Act does not provide for derivative use immunity in respect of information given in the course of an examination, the derivative use of information may not be completely unrestrained: see Lee v The Queen [2014] HCA 20; 253 CLR 455 (Lee (No 2)).
3. The Commissioner further submitted that the present case was different from Zhao in two respects. First, it was submitted that there was no evidence, contrary to the position in Zhao, that Mr McKell and Mr McGlone would be at risk of prejudice if an order for examination were made. Secondly, in Zhao, where the respondents were seeking an exclusion of certain assets from any forfeiture order that was made, it was incumbent upon them to file evidence in support of that application. In other words, in order to seek to preserve their assets they would be required to surrender their right to silence.
4. Notwithstanding that his main submission was that Zhao should be distinguished, the Commissioner also placed some reliance on the approach to s 319 in Zhao at [30] and [36] to support his overall submission that the pendency of a criminal trial cannot form the basis for an exercise of the discretion to postpone an examination: see above at [70] and [73].
5. The Commissioner also referred to Ruzehaji v Commissioner of the Australian Federal Police [2015] SASCFC 182, where a stay of examination proceedings under s 180 was refused. Gray J, with whom Peek and Nicholson JJ agreed, held, at [92], that more was required for a stay of proceedings than the mere existence of criminal proceedings. Mr Ruzehaji had asserted in an affidavit in support of his stay application that he "anticipated" that he would be required to address matters "directly relevant" to his pending criminal charges. Importantly, the Commissioner in that case had given an undertaking that the examination would not address the subject matter of the criminal charges. In that context, his Honour considered that the applicant had failed to demonstrate any specific prejudice and thus had not "met the burden which he must discharge": see Lee v DPP at [40].
6. Relevantly, however, Gray J did not consider that the reasoning in Zhao was relevant only to forfeiture proceedings. At [88], his Honour expressly noted the relevance to the proceedings before him of the High Court's findings in relation to s 319 at [30] and [36].

Zhao: Respondents' submissions

1. The respondents contended that nothing in Zhao precluded the court from taking into account the pendency of criminal proceedings in the exercise of the discretion and that the primary judge was correct to consider that the case weighed against the ordering of an examination.
2. In response to the Commissioner's submission that it followed from s 319, as interpreted in Zhao, that the pendency of criminal proceedings cannot form the basis of the exercise of the discretion to order a stay, the respondents contended that s 319 would have work to do even if the pendency of related criminal proceedings were sufficient for the postponement of an examination, in circumstances where the subject matter of the examination and the proposed criminal trial did not overlap.
3. The respondents also placed some reliance on the High Court's approach in Zhao to s 266A at [46]: see above at [77]. Their submission, as I understand it, was that that passage was authority for the proposition that the potential for evidence obtained in proceedings under the Act to be lawfully provided to the prosecution pursuant to s 266A was a factor which of itself created a risk of prejudice to the respondents and thereby weighed in favour of a stay.

Zhao: Consideration

1. The question whether the principles in Zhao apply to an application for an examination under s 180, and if so to what extent, may be disposed of in relatively brief terms. It should first be noted that the refusal to make orders under s 180 operates as a de facto stay of proceedings, such that the principles relevant to the grant of a stay are relevant to the exercise of the discretion under s 180: see NSWCC v Lee at [47].
2. The principle for which Zhao stands, as the observations in Ruzehaji correctly identify, is that the existence of criminal proceedings is not sufficient of itself to warrant the grant of a stay of civil proceedings brought under the Act. As discussed above, this point was also made by Gageler and Keane JJ in Lee (No 1) in respect of the exercise of the discretion whether to order an examination. As the High Court stated in Zhao, at [35], for a stay to be ordered the person to be examined must be "at risk of prejudice in the conduct of his or her defence in the criminal trial", the overarching principle being whether "the interests of justice require such an order" to be made.
3. It will thus be a question of fact in every case, having regard to the circumstances of that case, as to whether a person who seeks a stay of an examination that has been ordered has demonstrated that there are circumstances, other than the mere pendency of criminal proceedings, which create a real risk of prejudice to that person's defence of the criminal proceedings, such that it is in the interest of justice to stay proceedings. I do not consider that the principles relevant to the discretion are different as between examination procedures and forfeiture procedures, or between the discretion to order a stay and that to refuse to order an examination.
4. It follows that, to the extent that the respondents, by their construction of s 319, contend that mere pendency of criminal proceedings was sufficient to ground a refusal to order an examination, that contention must be rejected. Contrary to the respondents' submission, s 319 is not limited in application to the particular situation in which pending criminal proceedings traverse a different subject matter to proposed proceedings under the Act.
5. Section 266A expressly provides for the disclosure of evidence obtained in proceedings under the Act to, relevantly, prosecutorial bodies. It follows that the Act clearly contemplates the derivative use of that evidence against criminal defendants. I do not understand the passage in Zhao at [46], upon which the respondents relied, to be a statement of principle that the potential for lawful derivative use under s 266A raises a risk of prejudice such that it will be in the interests of justice that proceedings under the Act should be stayed merely because s 266A might be engaged. That approach would be contrary to the clear intent of s 266A to allow, at least in some circumstances, prosecutorial bodies the benefit of evidence obtained under the Act (subject to direct use immunity). I consider, however, that a risk of prejudice resulting from disclosure under s 266A may be relevant if that disclosure raises a specific prejudice that goes beyond that which inevitably follows from the application of the Act in circumstances in which a criminal trial is pending.
6. The specific matters upon which the Commissioner relied to argue that Zhao ought to have been distinguished by his Honour: see at [80] above, or that his Honour misapplied the principles stated in Zhao, are relevant matters in the sense that the exercise of a discretion must be considered having regard to the statutory matrix in which the discretion is to be exercised: The Queen v Australian Broadcasting Tribunal; Ex parte 2hd Pty Ltd [1979] HCA 62; 144 CLR 45 at 50. However, those factors do not of themselves demonstrate that his Honour erred in the exercise of the discretion.
7. In some circumstances, it may be that, as his Honour considered, Zhao applies with more force to an examination because of the statutory compulsion to answer questions, which is not the case in forfeiture proceedings. However, his Honour's statement was of itself incomplete. The real question, as I have explained above, is what the interests of justice require in the particular circumstances of the case, given that something more by way of risk of prejudice must be shown than the prejudice that arises from the mere pendency of criminal proceedings.
8. As the Commissioner accepted, "the interests of justice" is a chameleon concept, deriving its meaning from the text and purpose of the legislation in which it appears and the circumstances of the case. However, whether the Commissioner was correct in his contention that the primary judge erred by finding, in effect, that the interests of justice required that the application for examinations be refused if criminal proceedings were pending, requires a consideration of the correctness of his assertion that the bases enumerated by the primary judge for refusing to order the examinations came down to one central factor, namely, that criminal proceedings were extant. I now turn to that question. In doing so it will be convenient to also consider the fifth alleged error of the primary judge identified at [42] above, being that the primary judge should have found that there was no evidence of a risk of prejudice to Mr McGlone and Mr McKell by the proposed examinations.

Was his Honour's determination premised on the mere existence of criminal proceedings?

1. It is convenient to commence consideration of this question by reference to the Commissioner's submissions that, first, the primary judge's determination was based on the same factors that were found to reflect no more than the mere pendency of criminal proceedings in NSWCC v Lee; and secondly, that his Honour erred in considering an absence of prejudice to the Commissioner as a relevant factor. I will then be in a position to consider whether the considerations relied upon by the primary judge were, in sum, sufficient such that it was open to him to exercise his discretion to refuse to order the examinations sought.

Did his Honour err in failing to follow the approach taken in NSWCC v Lee?

1. In submissions filed, by leave, after the hearing of the appeal, the Commissioner contended that the submissions of the respondents as to why the discretion in s 180 of the Act should be exercised against ordering the examinations were to the same effect as those put to and rejected by the Court in NSWCC v Lee. In that case the Court found, at [74], that the respondents' complaint in that matter amounted to no more than that criminal proceedings were still pending, either at the trial stage or on an appeal which if successful might result in a retrial.
2. In NSWCC v Lee the primary judge at [16] had not made an order for examination on the basis that to do so, in circumstances where the privilege against self-incrimination had been abrogated, "would create a real risk of interference with the administration of justice". It was also relevant to his Honour's decision that there was no derivative use immunity under the Criminal Assets Recovery Act. This Court, having found error by the trial judge, determined it appropriate to re-exercise the discretion.
3. The respondents, in respect of the re-exercise of the discretion, relied upon a number of factors to argue that, even if the Criminal Assets Recovery Act provided a power to order an examination while criminal proceedings were pending, the discretion not to make such an order should be exercised in their favour.
4. Those factors were, in summary, as follows. First, derivative use had already been made by the prosecution of evidence the respondents had given in an earlier examination conducted under the Crime Commission Act 2012 (NSW) in that the prosecution had gained an understanding, from the evidence in that examination, of part of the first respondent's defence. Secondly, the prosecution's use of that material was improper as the first respondent had been assured that the interview was secret and would not be used in criminal proceedings. Thirdly, there had been delay in bringing the application for order for examination.
5. This Court rejected the submissions that there had been any impropriety in the use of the information obtained in the examination under the Crime Commission Act and also that there had been relevant delay. The Court also considered that the registrar conducting the examination would do so as to minimise any prejudice to the respondents. As noted above, it concluded that the matters advanced by the respondents to support their argument that the discretion should not be exercised so as to order an examination amounted to no more than the fact that the criminal proceedings were pending.
6. Contrary to the Commissioner's submission, the fact that there may have been factors in one case common to factors in another does not of itself dictate the manner in which a relevant discretion ought to be exercised. There may be circumstances and nuances in one case not present in another. A primary judge in a particular case may consider one or more factors have significance in the case at hand whereas a judge in another case may not have given the same emphasis to those facts. In any event, the point at issue in this case is whether the factors considered by the primary judge as relevant to the exercise of the discretion not to order the examinations were different from or went beyond the mere fact that the criminal trial was pending.

Did his Honour err in his reliance on a lack of prejudice to the Commissioner?

1. In oral argument, the Commissioner stressed that it was not necessary for him to point to any direct prejudice arising specifically from the circumstances of this case. He submitted that, in any event, specific prejudice to him was not a relevant consideration in the absence of evidence of prejudice to the respondents. He contended that, in the absence of such evidence, there was no balancing exercise to be undertaken as to the prejudice to the respective parties, as is usually required when a stay is sought.
2. The Commissioner also submitted that to defer making orders for the examination of the respondents until after the criminal trial would frustrate the timely operation of Act and that this in itself was relevantly prejudicial. The Commissioner relied on the following comments of Crennan J in Lee (No 1) at [131] as establishing some prejudice accruing to him from the delay in the examination: "The evident purposes of examination, in respect of serious crime related activities, subsist irrespective of whether a person has been charged with, tried for, or convicted of an offence, or even acquitted of that offence. To delay an examination from the time when a charge for an offence has been laid until criminal proceedings have been completed could frustrate the objects of identifying and recovering property sourced from serious crime related activity."
3. The primary judge was correct to find, in his third reason, and as is apparent from the Commissioner's submission that there was no practical prejudice of any significance to him if the examinations were delayed. Crennan J's comments were not made in the context of a consideration of the discretion to order an examination and I do not consider that they are of direct application to the question of prejudice. More relevantly, the High Court in Zhao considered that the Commissioner would in that case, "suffer no relevant prejudice from a delay in the continuation of the forfeiture proceedings": at [50]. I consider that the same is true in the present context of examination proceedings.
4. For the reasons that follow, I do not accept the Commissioner's submission that the respondents failed to establish any prejudice to them. It follows that I find that the primary judge was not in error in considering that the absence of prejudice to the Commissioner was relevant to the exercise of his discretion.

Analysis of his Honour's reasons

1. I have set out in summary form at [38] above the various reasons that his Honour gave for refusing to make the order for examination of the respondents before their criminal trial.
2. Properly understood, I consider that the primary judge's enumerated reasons may be grouped into the following categories:

First category The existence of criminal proceedings was relevant to the question whether to make the orders for examination under the Act because: 1. the questioning at the examination would relate to the monies subject of the s 400.9 charges and evidence of finding the monies was likely to be tendered as circumstantial evidence on the drug charges: reason 1; 2. the privilege against self-incrimination was abrogated, there was no derivative use immunity and the respondents would be compelled to give evidence at the examination: reasons 1, 2, 5 and 6; 3. there remained a need to retain the fundamental characteristics of a criminal trial: reason 4; 4. although the mere fact of criminal proceedings was not sufficient to give rise to a stay, the power provided by s 180 was discretionary, and the Act did not preclude the exercise of that discretion to postpone an examination in particular circumstances: reasons 2 and 9; 5. Lee (No 1) concerned the power to order an examination under the Act, and did not preclude taking into account that the criminal proceedings were pending. Lee (No 1) was also distinguishable on the basis that it considered examinations which took place before court officers: reasons 7 and 8; and 6. Zhao demonstrated that in some circumstances a stay should be granted in order to protect the integrity of criminal proceedings; that finding was made in the context of s 319, which applies to both forfeiture and examination procedures; and Zhao should not be distinguished on the basis that it concerned forfeiture proceedings, particularly in the context of the greater risks arising from the compelled nature of examination procedures: reasons 5, 6 and 10.

Second category The nature of the particular criminal proceedings faced by Mr McKell and Mr McGlone militated in favour of the grant of a stay because s 400.9 of the Criminal Code placed an onus on them such that in their defence they would be required to give evidence: reason 12.

Fourth category There was no practical prejudice to the Commissioner: reason 3.

Fifth category The Commissioner had failed to seek the order with urgency: reason 15.

Sixth category The adverse effects of an examination, in the circumstances of the case, were "perfectly obvious" and did not require affidavit evidence: reason 11.

Seventh category It was not appropriate to defer consideration of postponing the examination to the examiner: reason 13.

1. I consider that the matters that fall into the first category are necessary incidents of the pendency of any criminal proceedings which will traverse the same subject matter as the examination proceedings. Those factors are necessary for the grant of a stay (or the refusal to make orders for an examination) in the sense that it is difficult to imagine circumstances in which a stay would be granted or an examination not ordered absent criminal proceedings. In that sense, his Honour was not in error in having regard to them. However, it is clear from the authorities examined above that they are not sufficient for the grant of a stay or for examination to be refused and that more is required.
2. I would note that, although the question of evidence will be considered further below, the sixth category would be unlikely to be, on its own, a sufficient reason to postpone the examination.
3. I agree, for the reasons given by the primary judge, with the approach reflected in the seventh category. However, that also does not of itself provide any positive reason to exercise the discretion to postpone the examination.
4. Whilst it might be argued that the second to fifth categories are related to the criminal trial, I am of the opinion that they do not amount to considerations involving "the mere pendency of criminal proceedings". Rather, they are additional factors, in the sense that they are not factors that necessarily arise in respect of every criminal trial. They are the particular circumstances that arise in this case given that Mr McGlone and Mr McKell are charged with particular criminal offences and are awaiting their trial.
5. The fact that his Honour's reasons for refusing to make orders for examination, properly characterised, include factors that go beyond the mere pendency of a criminal trial, does not of itself compel the exercise of a discretion in favour of Mr McGlone and Mr McKell. Rather, there must be demonstrated a risk of prejudice such that it is in the interests of justice that the examinations not be conducted prior to the criminal trial being held. It is thus necessary to deal with each of these factors in turn, although they necessarily overlap or otherwise impact upon each other.
6. The Commissioner accepted, in oral argument, that the trial was imminent. He also accepted that a matter relevant to whether an examination order ought to be made would include any prejudice that an accused person might suffer in relation to the conduct of their defence. He contended, however, that in this case there was no evidence that the respondents would be impaired in the conduct of their defence.
7. Mr McKell gave evidence that stated his concerns as to the effect an examination would have on his preparation for the criminal trial. The Commissioner submitted that this evidence did not establish prejudice and contrasted Mr McKell's evidence with that adduced in Zhao. I do not agree with that submission. Mr McKell clearly identified the position he was likely to be placed in if he was examined before the criminal trial. Those matters gave rise to a demonstrable risk of prejudice in the conduct of his defence.
8. Whilst it is correct that Mr McGlone did not adduce any evidence, in the circumstances of this case, the imminence of the criminal trial was of itself a matter that was inevitably going to give rise to prejudice to both Mr McKell and Mr McGlone. Evidence is not required of the stress, personal strain, financial implications as well as the time that needs to be dedicated to the preparation of any court proceeding, let alone a criminal trial in which, if found guilty, Mr McGlone and Mr McKell potentially face significant periods of imprisonment. To be vexed with an examination under the Act at the same time is of itself prejudicial. It is for that reason that the third category, namely, the lack of urgency with which the Commissioner made his application for the orders, was relevant to his Honour's determination. The Commissioner's conduct in not making the application for examination in a timely manner had contributed to the prejudice to Mr McGlone and Mr McKell.
9. In addition, as Mr McKell indicated in his affidavit, and as is apparent from the provisions of s 400.9 of the Criminal Code, if Mr McGlone and Mr McKell are to defend the charges relating to the money found in their possession, it is highly likely that they will be required to give evidence.
10. Section 400.9 only requires the Crown to prove that a person has dealt with money or property and that "it is reasonable to suspect that the money or property is proceeds of crime": s 400.9(1), in relation to amounts greater than $100,000; and s 400.9(1A) in relation to lesser amounts. Absolute liability applies to the reasonable suspicion element: s 400.9(4). The defendant may contest a charge under s 400.9 pursuant to s 400.9(5), which provides that the section does not apply: "… if the defendant proves that he or she had no reasonable grounds for suspecting that the money or property was derived or realised, directly or indirectly, from some form of unlawful activity." The Criminal Code expressly places a legal onus on the defendant in respect of s 400.9(5): see s 13.4. The practical effect is that a defendant will generally need to adduce evidence and almost invariably will need to give evidence personally to discharge an onus of proof to defend charges under s 400.9.
11. The examination of Mr McGlone and Mr McKell will relate to the money the subject of the s 400.9 charges. It follows that they will be required to answer questions in the examination about the very matter on which, if they wish to defend the s 400.9 charge, they will be required to adduce evidence in the criminal trial. It will be remembered that in Zhao the High Court, at [46], endorsed the Court of Appeal's view that the possibility that the prosecution might, by the operation of s 266A, possess evidence obtained under the Act and that "protective orders would not suffice to remove the risk of prejudice to the second respondent's defence". The risk of prejudice is more substantial in circumstances where an accused bears an onus, as is the case in respect of an offence under s 400.9. I would add, in respect of Mr McGlone, that that risk is obvious, notwithstanding he had not filed any evidence in opposition to the Commissioner's application for an examination.
12. As the primary judge did not err in finding relevant prejudice to Mr McGlone and Mr McKell, there is, as noted above, no question that the absence of prejudice to the Commissioner was also relevant to the exercise of the discretion.
13. It follows, in my opinion, that the matters in the second to fifth categories, and those in the second and third categories in particular, were not factors that related only or merely to the fact that curial proceedings were extant. As that was the essential basis of the challenge to the primary judge's exercise of discretion, the Commissioner has not established error, in the House v The King sense, in the exercise of his discretion to refuse to make an order under s 180 against Mr McGlone or Mr McKell.

THE CASE AGAINST MRS MCGLONE

1. His Honour refused to make an order against Mrs McGlone on two interrelated bases: first, because of the possibility that she may be charged with an offence: at [78]; and secondly, because to proceed with her examination would result in two sets of proceedings relating to the affairs of Mr McGlone and Mr McKell: at [18]. I will consider the two bases in turn.
2. The High Court delivered its decision in R v Independent Broad-based Anti-corruption Commissioner [2016] HCA 8 (R v IBAC) on 10 March 2016, after the primary judge in this matter made his determination. The Court was concerned with whether, under the Independent Broad-based Anti-corruption Commission Act 2011 (Vic) (the IBAC Act), the power to conduct an examination under Pt 6 was exercisable in relation to persons who have not been, but might subsequently be, charged and put on trial for an offence relating to the subject matter of the examination.
3. Relevantly for present purposes, an investigation may be conducted under the IBAC Act notwithstanding that civil or criminal proceedings are on foot that are connected with the subject matter of the investigation: s 70(1). Section 70(2) requires that, if the IBAC becomes aware of such proceedings, it must take all reasonable steps to ensure that the investigation does not prejudice them. Information obtained may be disclosed to prosecutorial bodies and law enforcement agencies: s 41. The privilege against self-incrimination is abrogated: s 144(1), and there is provision for direct use immunity: s 144(2).
4. The High Court unanimously held that an investigation could be conducted notwithstanding that a person might be charged with a criminal offence relating to the subject matter of the examination. At [48], their Honours expressly rejected the suggestion that the 'companion rule' articulated in Lee (No 2) at [33], that the prosecution cannot compel a person charged with a crime to assist in the discharge of the prosecution's onus to prove their guilt beyond reasonable doubt, also applied to a person who had not been charged with an offence.
5. In submissions filed by leave after the hearing, the Commissioner submitted that R v IBAC was clear authority that there was no reason why Mrs McGlone could not be examined. Mrs McGlone conceded, properly, that having regard to the High Court's finding at [48], she could not rely on the possibility of her being charged as the basis for delaying her examination. It follows that the primary judge erred in respect of the first basis on which he refused to make an order against Mrs McGlone.
6. In respect of the second basis, the primary judge held, at [81], that there was force in the Commissioner's submission that avoidance of multiplicity of proceedings was not determinative, but that he considered that it remained an "important matter".
7. In Zhao, it appears that the avoidance of multiplicity of proceedings was, on its own, a sufficient basis for the ordering of a stay in respect of the first respondent, Ms Zhao, against whom no criminal proceedings were pending. The High Court held, at [48], that "… the Court of Appeal was correct to identify as relevant that to permit the forfeiture proceedings to proceed against her would produce two sets of proceedings, rather than one. The principle of the common law that seeks to prevent a multiplicity of actions has a long history and cannot be ignored." (citations omitted)
8. In this context, however, the distinction between forfeiture proceedings and examination proceedings acquires some significance. An application for a forfeiture order is made to the court under s 49 of the Act. In Zhao, each respondent, separately but in respect of the same property, sought to resist the making of that order. In order to do so, they brought applications under ss 31 and 74, by which the court may order that property be excluded from, respectively, a restraining order or a forfeiture order. They also sought compensation under s 78.
9. In that circumstance (and putting to one side the stay application), there were before the court applications brought under the Act by the Commissioner and each respondent. The resolution of those applications would clearly have traversed, to a substantial extent, the same subject matter. As the proceedings against Mr Jin had been postponed, Ms Zhao could rightly claim that a stay was warranted in order to avoid a multiplicity of court proceedings.
10. In contrast, in the present case, the concept of multiplicity of proceedings is not relevant in the sense that the nature of an examination is such that each person in respect of whom an order is made for examination is examined separately. Thus if an order for examination were made in respect of only Mrs McGlone, she could and would be examined by an approved examiner at a time that was appointed, regardless of whether and when Mr McGlone and Mr McKell were examined. Leaving aside the question whether the "principle of the common law" referred to in Zhao, which relates to a multiplicity of "actions", applies to executive examinations not conducted in a court, that principle has no factual application in this case as each respondent will be examined separately in any event.
11. It follows in my opinion that his Honour erred in the exercise of his discretion in respect of the Commissioner's application to examine Mrs McGlone. As the parties made submissions as to any re-exercise of the discretion it is appropriate for this Court to consider whether an order should be made for her examination.
12. In circumstances where Mrs McGlone has not adduced any evidence as to why an order for examination should not be made, the Court is left to determine the matter having regard to the matters about which there was no dispute or which may reasonably be inferred from the circumstances. Those factors are, essentially, that Mrs McGlone may have knowledge or information about the monies in respect of which her husband has been charged; that any evidence that she gave would not be protected by direct or derivative use immunity in respect of the use of any information in the criminal trial of Mr McGlone and Mr McKell; that the Commissioner has delayed in bringing the application; and that, for the reasons I give above at [103]-[106], the Commissioner will not be prejudiced if a decision as to whether an examination should be ordered is deferred until after the criminal trial.
13. It can be readily inferred that Mrs McGlone will be questioned, inter alia, about her knowledge of the money found in the home and presumably about the money in Mr McKell's possession. As I have already explained, the s 400.9 offence with which Mr McGlone and Mr McKell are charged is an offence of strict liability. Mrs McGlone's evidence given in an examination would not be protected by any direct or derivative use immunity in respect of the criminal proceedings against Mr McGlone and Mr McKell and could, pursuant to s 266A, be made available to the prosecution. Should that occur, the conduct of their respective defences would, almost inevitably, be prejudiced.
14. The Commissioner has conceded that to counter any such prejudice, it was appropriate that, in this case, conditions relating to the disclosure to persons involved in the prosecution of Mr McGlone and Mr McKell should be attached to any order for examination that is made. The imposition of such conditions as proffered by the Commissioner is a factor that would favour not deferring the examination.
15. There remain questions of delay and lack of prejudice to the Commissioner, both of which are relevant factors and which point against the exercise of the discretion in the Commissioner's favour. In this regard, it cannot be assumed that the stress of the criminal proceedings will not have an impact on Mrs McGlone. The delay in bringing the application, coupled with the fact that the Commissioner did not seek expedition of the appeal, and the absence of any prejudice to the Commissioner should the examination be deferred until after the criminal trial of Mr MrGlone and Mr McKell, are factors that point to the discretion being exercised against making an order at this time.
16. Although the matter is finely balanced, in the end result, given the Commissioner's concession that conditions be imposed on the conduct of the examination, I consider that the Commissioner's delay and absence of prejudice to him is not sufficient to defer making an order for the examination of Mrs McGlone. The prejudice caused by the Commissioner's delay has its most acute impact on Mr McGlone and Mr McKell as they prepare for their trial in a few weeks' time on serious criminal charges. Although, as I have said, Mrs McGlone would not be unaffected by the fact of the impending trial, I do not consider that the stress she may experience is a sufficient reason to defer an order being made for her examination.

Costs

1. The Commissioner has failed on its appeal against Mr McGlone and Mr McKell but has succeeded as against Mrs McGlone. However, as will be apparent from these reasons, the argument in relation to Mrs McGlone did not occupy a substantial amount of the Court's time and little extra work for the parties, save in respect of the further submissions that were filed by leave in relation to the High Court decision in R v IBAC, handed down the day after this appeal was heard. More particularly, a, if not the significant matter which caused this Court to exercise its discretion in the Commissioner's favour was the conditions proposed by the Commissioner should an examination be ordered. That proposal was only made in submissions to the Court after the conclusion of the oral hearing. In the circumstances, I consider that the Commissioner should bear the respondents' costs of the appeal.

Orders

1. Accordingly, I propose the following orders: 1. Grant leave to appeal. 2. Dismiss the appeal insofar as it relates to Richard McGlone and Jason McKell. 3. Allow the appeal insofar as it relates to Jodie McGlone. 4. Set aside order 1 made by the trial judge insofar as it applies to Jodie McGlone. 5. Order that pursuant to s 180 of the Proceeds of Crime Act 2002 (Cth), Jodie McGlone be examined about Richard McGlone's affairs. 6. Order that pursuant to s 180 of the Proceeds of Crime Act 2002 (Cth), Jodie McGlone be examined about Jason McKell's affairs. 7. In respect of the examinations conducted pursuant to orders (5) and (6), order that: 1. no person involved in the investigation or prosecution of the offences of which the Richard McGlone and Jason McKell are charged be present during the examination; and 2. the transcript of the examination, any matter contained in answers given during the course of the examination, and documents produced at the examination insofar as they relate to the circumstances of the offences with which Richard McGlone and Jason McKell are charged, not be disclosed to any person involved in the investigation or prosecution of those offences. 1. Order that the Commissioner pay the respondents' costs of the appeal.
2. WARD JA: I agree with Beazley P.
3. GLEESON JA: I agree with Beazley P.

Amendments 23 May 2018 - Publication restriction removed - judgment published 04 September 2023 - Publication restriction removed - judgment published. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 04 September 2023