PROPOSED APPEAL - GROUND 1
11 This ground concerns the "interests of justice" criterion in s 128A(6)(c). The primary judge concluded that he "would have been of the clear view that the interest of justice favoured disclosure" but for one consideration. His Honour reasoned at [26]-[30]:
It would appear to be accepted in the context of s 128 that the phrase "interests of justice" should be construed "broadly": Cureton v Blackshaw Services Pty Ltd [2002] NSWCA 187 at [37] per Sheller JA. It would also appear to be accepted that it is not enough that the evidence in question be relevant - a "relatively high standard of satisfaction" is required given that the legislation to a significant extent abrogates a basic common law right: Gedeon at [286]. In my view, these observations apply equally to s 128A(6)(c).
In general terms, the Commissioner submitted that it was in the interests of justice that there be disclosure of the privileged affidavit having regard to the findings made by Yates J about the risk of dissipation of assets, the allegations concerning significant historical transfers of funds to China, and the negligible value of the assets disclosed in Mr Shi's non-privileged affidavit. The Commissioner suspects there are more assets over which Mr Shi has effective control. He wants to know about these. As things stand, the assets so far disclosed fall far short of the $42,297,437.65 that Mr Shi owes the Commissioner. The Commissioner, it was said, may wish to issue writs of execution of property, charging orders, a court ordered garnishee and may wish to perform court examinations. These remedies will be facilitated by full disclosure. In that respect, in my view, there is a clear public interest in having Mr Shi's debt to the Commonwealth discharged as fulsomely as is possible.
Mr Shi submits that the interests of justice require me to consider the totality of the facts and circumstances, the potential impact on future proceedings and the stage reached in the current proceedings. He points out that s 128A(8) would not prevent the Commissioner from giving the material to prosecutors and that this might lead to a miscarriage of justice. If that were to take place there was also a risk that prosecutors might use the evidence to find or encounter "derivative information" despite the protection afforded by s 128A(8). Whilst Mr Shi has yet to be charged, he notes that the accusatorial process of criminal justice can commence pre-charge: X7 v Australian Crime Commission (2013) 248 CLR 92; Strickland (a pseudonym) v Commonwealth Director of Public Prosecutions [2018] HCA 53; (2018) 93 ALR 1. Mr Shi also points to the fact that disclosure is not needed for the Commissioner to obtain the only remedy he sought in his original applications, namely, judgment debts against each respondent. He now has that. Mr Shi also observes that the issue of any certificate pursuant to s 128A(7) would have no effect in a Chinese court where Mr Shi might face charges.
I should point out that the Commissioner submits that he would not be permitted to give the privileged affidavit to the police or other prosecutorial authorities because such disclosure would be in breach of the "Harman" undertaking: Harman v Secretary of State for Home Department [1983] 1 AC 280. I agree with that submission. Unless given leave, the Commissioner would not be at liberty to disclose the privileged affidavit to a third party. No such leave has been sought. Moreover, even if the prosecutorial authorities were to obtain the privileged affidavit, any certificate issued pursuant to s 128A(7) would prevent it being used against Mr Shi in any subsequent criminal proceedings.
But for one consideration, I would have been of the clear view that the interests of justice favoured disclosure. The public interest in recovery of the outstanding tax is a compelling consideration…
12 The "one consideration" was the consequence of the issue of a certificate by the Court pursuant to s 128A(7). His Honour continued at [30]:
… In general terms, the consequence of disclosure with the issue of a certificate would be that much of the information contained in the privileged affidavit would not be able to be used against Mr Shi in any Australian Court (s 128A(8)). That would also include evidence of any information, document or thing obtained as a "direct result or indirect consequence" of the disclosure. In my view, that might have consequences in any future criminal proceeding as well as any future tax appeal pursued by Mr Shi pursuant to Part IVC of the [Tax Administration Act 1953]. In that respect, there is also a clear public interest that taxpayers pay the correct amount of tax based upon all of the relevant facts. The privileged affidavit contains information that may bear upon that issue.
13 In concluding that the interests of justice did not require disclosure, the primary judge considered it relevant that the DCT could use his powers to obtain information compulsorily pursuant to s 353-10 of Sch 1 of the Taxation Administration Act 1953 (Cth) (the TAA) in order to obtain the information in the privilege affidavit from Mr Shi by means other than an order for disclosure under s 128A(6). Section 353-10 relevantly provides:
(1) The Commissioner may by notice in writing require you to do all or any of the following:
(a) to give the Commissioner any information that the Commissioner requires for the purpose of the administration or operation of a *taxation law;
(b) to attend and give evidence before the Commissioner, or an individual authorised by the Commissioner, for the purpose of the administration or operation of a taxation law;
(c) to produce to the Commissioner any documents in your custody or under your control for the purpose of the administration or operation of a taxation law.
Note: Failing to comply with a requirement can be an offence under section 8C or 8D.
(2) The Commissioner may require the information or evidence:
(a) to be given on oath or affirmation; and
(b) to be given orally or in writing.
For that purpose, the Commissioner or the officer may administer an oath or affirmation.
…
14 The primary judge noted (at [32]-[34]) that the privilege against self-incrimination cannot be invoked as a reason not to comply with a notice issued pursuant to s 353-10 (Deputy Commissioner of Taxation v De Vonk [1995] FCA 994; 61 FCR 564 (De Vonk) at 583-4 per Hill and Lindgren JJ) and (at [35]) that the Harman undertaking, if it be relevant, would not prevent taxation officers from using information obtained pursuant to a s 353-10 notice, referring to Deputy Commissioner of Taxation v Rennie Produce (Aust) Pty Ltd (in liq) [2018] FCAFC 38; 260 FCR 272. The primary judge at [36]-[45] also rejected the DCT's argument that an exercise of the s 353-10 power in the present case might "embroil the Commissioner in an argument about contempt of court" because of the possibility of future criminal proceedings, reasoning on the authorities that there would be no "usurpation" of the function of the Court because there was no current criminal proceeding against Mr Shi, only a criminal investigation which may, or may not, result in charges being laid and as things stood, there were no criminal proceedings of which to be in contempt.
15 At [44] the primary judge, after observing that it is in the public interest that the DCT, in raising assessments and collecting tax, has the most accurate information available, concluded it was in the public interest that the DCT have access to the most complete information concerning the worldwide assets of Mr Shi. The primary judge stated:
He should have that access, and be able to use any resulting information for the purposes of a recovery. If necessary, he should be free to use that information "against" Mr Shi in any subsequent proceedings relating to recovery or in any future tax appeal instigated by the respondents. That type of use is in the public interest.
16 The primary judge reasoned that the broad limitations on use of information disclosed subject to a certificate granted under s 128A militated against the interests of justice requiring disclosure when another avenue was open to the DCT to obtain the information which would allow him to use it more freely and which would better fulfil the compelling public interest in recovery of unpaid tax.
17 The DCT argued that the primary judge fell into error in the House v The King [1936] HCA 40; 55 CLR 499 sense in taking the DCT's powers under s 353-10 into account in determining whether the interests of justice required disclosure of the information in the privilege affidavit. First, it was argued that the primary judge acted on a wrong principle in holding that the DCT could not be prevented from using his s 353-10 power to obtain the information contained in the privilege affidavit in the absence of current criminal charges against Mr Shi. On the DCT's submissions, in circumstances where the Court had determined, in the interests of justice, that the DCT should not have access to the privileged information, the use of s 353-10 to require Mr Shi to provide that information may be a contempt of court. At the very least the DCT would be obliged to consider whether the issue of a notice under s 353-10 would interfere with the administration of justice. Secondly, it was argued that it was irrelevant to the question of where the interests of justice lie that the DCT could obtain the privileged information by exercising his power under s 353-10. It was argued that:
(a) the disclosure of assets pursuant to an asset disclosure order is important to the efficacy of a freezing order because of the urgency of the relief attaching to the making of a freezing order, which is to prevent the risk that assets are moved to frustrate the court's processes;
(b) the power given to the DCT by s 353-10 to obtain information is a different statutory mechanism with a substantially different enforcement method in the event of non-compliance. The DCT's use of his power under s 353-10 to obtain the information that Mr Shi disclosed in the privilege affidavit would not provide the same timely and effective mechanism for enforcement of the freezing order against Mr Shi as if the information was required to be disclosed pursuant to the asset disclosure order;
(c) without the timely disclosure of assets, the purpose and utility of the freezing order, urgently obtained, may be defeated by delay in information being furnished pursuant to a s 353-10 notice, with the risk that assets are moved in the meantime;
(d) the DCT should be in no different position to any other litigant where an asset disclosure order had been made and the DCT seeks to avail himself of the Court's processes;
(e) given the inherent urgency of disclosure orders, determining the scope of the assets under risk should not be deferred in circumstances where the Court has a proper and readily available process;
(f) the DCT should have available to him effective means of enforcing compliance with the disclosure order and the same process that would be available to other litigants before the Court; and
(g) as the freezing orders remained in place at the time of the hearing of the application under s 128A, the risk of dissipation remained an ongoing concern.
18 For Mr Shi it was argued that the primary judge was correct to hold that the DCT could use his power pursuant to s 353-10 of Sch 1 to the TAA in order to obtain the information in the privilege affidavit from Mr Shi by means other than an order for disclosure under s 128A(6) and it must be a relevant consideration for the purposes of s 128A(6)(c) that the DCT could exercise that power to obtain information to aid the DCT in recovery of the unpaid tax. It was also submitted that there is nothing in the express language of s 128A which would operate to confine the Court's discretion on the question of where the interests of justice lie, and if the information could potentially be obtained by a means other than an order under s 128A(6), that would be a relevant consideration against the importance of the privilege affidavit itself to the proceedings (as opposed to the information in it). It was submitted it would also be a relevant consideration if disclosure with a certificate may not materially further the public interest because such disclosure would preclude the DCT from using the information in the privilege affidavit in any proceeding, including a proceeding under Pt IVC of the TAA concerning an appeal from an objection decision in respect of Mr Shi's assessed tax liability. Finally, in relation to the DCT's submissions concerning "considerations of urgency" as a basis upon which the Court should conclude that the DCT's power under s 353-10 was an irrelevant consideration, it was submitted that whilst urgency is a consideration relevant to a decision to make a freezing order and ancillary asset disclosure orders, it did not follow that the potential for the DCT to exercise his compulsory powers was an irrelevant consideration in assessing the interest of justice under s 128A(6)(c). It was submitted that the DCT's submission amounted to a contention that the primary judge should have given more weight to the urgency inherent in freezing orders, which was not a ground of appeal. In any event, it was submitted, the primary judge did consider the nature of freezing orders, asset disclosure orders and the urgency inherent in those orders and absent specific error being identified, the weight to be given to that consideration was a matter for the primary judge as the holder of the discretion.
19 It is useful as a starting point for addressing the competing arguments of the parties to consider the background to the enactment of s 128A of the Evidence Act and the balance of interests which s 128A strikes between the right of a person to object to compliance with an asset disclosure order on the ground that disclosure may lead to their incrimination, and the requirement for the person to make disclosure of their assets pursuant to the disclosure order. The background is helpfully set out by Campbell J in Pathways Employment Services Pty Ltd v West [2004] NSWSC 903; 186 FLR 330 (Pathways). In summary, until the enactment of s 128A in 2008, the privilege against self-incrimination could be invoked by a person for refusing to comply with an asset disclosure order: Reid v Howard [1995] HCA 40; 184 CLR 1. The limited abrogation of the privilege effected by the enactment of s 128 of the Evidence Act in 1995 (and cognate provisions in state Evidence Acts) applies where a "witness" objects to giving "evidence" on the ground that the evidence may tend to incriminate them. If a court requires the witness nonetheless to give that evidence, the court must issue a certificate under the section. The effect of the certificate is that the evidence and any information obtained as a direct or indirect consequence of the witness giving the evidence cannot be used against the witness in any Australian court. Importantly, s 128 only applies if a "witness" objects to giving particular "evidence". Due to this limitation, the procedure adopted in some cases where a person objected to giving evidence about their assets pursuant to an asset disclosure order on the basis of the privilege against self-incrimination was for the affidavit disclosing the person's assets to be brought into court after it was sworn but before it was filed for the court to consider whether there were reasonable grounds for the objection and, if the court was so satisfied, evidence subject to a certificate would be adduced from the person by reading the affidavit: see Bax Global (Australia) Pty Ltd v Evans [1999] NSWSC 815; 47 NSWLR 538 at 547-8 [33]-[35] and 549-551 [40]-[45]. This procedure became known as the "Bax Global (Australia) Pty Ltd v Evans procedure". In Ross v Internet Wines Pty Ltd [2004] NSWCA 195; 60 NSWLR 436 (Ross), it was held that the Bax Global (Australia) Pty Ltd v Evans procedure infringed the privilege against self-incrimination. At 452 [104], Giles JA (with whom Spigelman CJ and McColl JA agreed) stated:
I recognise the objective of the Bax Global (Australia) Pty Ltd v Evans procedure in the administration of justice. In my opinion, however, it is impermissible for the court to substitute for a person's fundamental common law right the statutory balance of rights, supplemented by court-devised additional protection by way of artificially making the disclosing party a witness, closure of the Court, limitations on who can see the disclosure affidavit, or if privilege is upheld and no certificate is granted return of the affidavit to its maker; all not pursuant to statute but by the court devising a procedure intended to inhibit the direct or derivative use against the person of information tending to incriminate. Taking up the words in Reid v Howard (at 17), it is:
"… inimical to the administration of justice for a civil court to compel self-incriminatory disclosures, while fashioning orders to prevent the use of the information thus obtained in a court vested with criminal jurisdiction with respect to the matters disclosed. Nor is justice served by the ad hoc modification or abrogation of a right of general application, particularly not one as fundamental and as important as the privilege against self-incrimination."
It was held that it was wrong for the Court to fashion a procedure to make someone a witness so that the privilege against self-incrimination could be circumvented, despite the issue of a certificate under s 128 of the Evidence Act.
20 After Ross, Campbell J in Pathways refused an application by the plaintiffs for an order for an oral examination of the defendant as to his assets as an incident of the Court's jurisdiction to require disclosure in aid of a freezing order where the defendant would claim privilege against self-incrimination. Justice Campbell held that it would be a wrong exercise of discretion to make such an order where the only reason for the oral examination would be to get around the defendant's privilege against self-incrimination. His Honour said at 346 [39]-[40]:
… the order which the plaintiff seeks would involve the first defendant being compelled to be in the situation of a witness. He would not be in the situation of a witness at all if such an order were not made. The only reason for putting him into the situation of a witness is so that the privilege against self-incrimination which he would otherwise have can be got around. True, if it were to be got around, it would be got around on the basis of providing him with a certificate under s 128 Evidence Act which would protect him from quite a few, though possibly not all, of the potential harmful consequences of his being required to disclose the privileged information. Even though in one sense the Court has jurisdiction to require a person to give evidence on oath, about his assets in connection with a Mareva order, it would be a wrong exercise of discretion to require such disclosure to be made when it cuts down a privilege against self-incrimination in circumstances where the legislature has not clearly indicated it is appropriate to cut the privilege down.
… here the real reason why the Court is being asked to make the first defendant a witness is so that his privilege against self-incrimination can be compromised. That privilege is preserved by all the other usual pre-trial procedures of the Court. The first defendant has it within his own power to preserve it at the trial, by not giving evidence. It is only by the active involvement of the Court, in setting a time and place for a special hearing which otherwise would never occur, that the first defendant would become a witness. I am not persuaded that these are circumstances within the scope of the circumstances for which Parliament intended s 128 Evidence Act to provide an exception to the privilege against self-incrimination.
Justice Campbell also noted there was a lack of coherence in the law concerning the privilege against self-incrimination and the law concerning compulsory disclosure of information in civil proceedings (at 347 [46]) and at 349 [49] commented that it was an appropriate topic for consideration by the New South Wales Law Reform Commission.
21 The question of whether the privilege against self-incrimination should be abrogated in relation to search and freezing orders was taken up by various law reform bodies. In a joint report published in December 2005 (Uniform Evidence Law (Australian Law Reform Commission (ALRC) Report 102, Law Reform Commission of New South Wales (NSWLRC) Report 112, Victorian Law Reform Commission (VLRC) Final Report)), the Law Reform Commissions included the following recommendation at 15-10:
The uniform Evidence Acts should be amended to provide that the privilege against self-incrimination cannot be claimed in respect of orders made in a civil proceeding requiring a person to disclose information about assets or other information (or to attend court to testify regarding assets or other information) or to permit premises to be searched. However, it should be provided that evidence obtained in compliance with such orders cannot be used against the person in a criminal or civil penalty proceeding against the person, where the Court finds that the evidence might tend to incriminate the person, or make the person liable to a civil penalty. This use immunity should only apply to documents or information created pursuant to the court order, and not to a pre-existing document or thing.
22 Following that report, the VLRC gave the matter "further consideration" (VLRC Report: "Implementing the Uniform Evidence Act", February 2006) and prepared draft provisions said at [2.66] to be designed:
(a) generally to abrogate privilege against self-incrimination in relation to pre-existing documents at all stages of court proceedings;
(b) to confine the operation of the remaining provision to orders for disclosure by affidavit made in or in connection with Anton Piller or Mareva orders;
(c) to provide a procedure by which the evidence may be secured without compromising the ability of the deponent to claim the privilege; and
(d) in line with the operation of the privilege at trial under s 128, to limit the court's ability to require disclosure to instances where the certificate procedure is able to provide either an absolute or a reasonable degree of protection. In this last respect, the VLRC noted at footnote 81:
This is done by excluding the power to require disclosure where the self-incrimination relates to an offence in a foreign jurisdiction and by making the power discretionary and subject to an "interests of justice" test so that consideration can be given to the extent of the protection afforded by the certificate.
The VLRC added at [2.67] that it was taking "an admittedly cautious approach to the abrogation of the privilege" but justified this caution because of the "fundamental nature of the privilege" and the likelihood that disclosure orders would be made ex parte and at short notice.
23 In 2008, s 128A of the Evidence Act was enacted with the "interest of justice" criterion recommended by the VLRC. The criterion stipulated in s 128A(6)(c) is that the court be satisfied that the interests of justice require the information contained in the privilege affidavit to be disclosed. The inquiry as to what constitutes the "interests of justice" is broad and unconfined but two observations can be made at the outset. First, the consideration of that criterion is in the context where an asset disclosure order has been made in aid of a freezing or search order and the respondent to the freezing or search order is entitled to object to the disclosure of the information on the ground that such information may tend to prove that the person has committed an offence against or arising under, or is liable to a civil penalty under, an Australian law or a law of a foreign country. Thus, as the starting point, neither the fact that an asset protection order has been made, nor the fact that the person against whom the order is made is entitled to claim privilege against self-incrimination weighs the interests of justice one way or the other. It is a matter of balancing all the considerations that may bear upon whether the interests of justice require disclosure of the privileged information: BHP Billiton Ltd v Schultz [2004] HCA 61; 221 CLR 400 (BHP Billiton Ltd v Schultz). Those factors will vary from case to case, as will the weight to be attached to those factors in any particular case. Secondly, in weighing up the interests of justice in each case, it is important to recognise that s 128A necessarily impacts on the disclosing party's common law privilege by requiring disclosure subject only to a certificate which prevents the information disclosed, or information derived from the information disclosed, being used against the disclosing party in any proceedings in an Australian court.
24 As the primary judge correctly noted, the privilege against self-incrimination is abrogated by the Commissioner's power under s 353-10 of Sch 1 of the TAA to obtain information from a person and, relevantly, the fact that the provision of the information may tend to incriminate a person is not reason for the person to refuse to comply with the notice: Stergis v Commissioner of Taxation (Cth) (1989) 89 ATC 4442; De Vonk; Binnetter v Deputy Commissioner of Taxation [2012] FCAFC 126; 206 FCR 37 at 47 [30]. In De Vonk Hill and Lindgren JJ explained at 583:
If the argument were to prevail that the privilege against self-incrimination was intended to be retained in tax matters, it would be impossible for the Commissioner to interrogate a taxpayer about sources of income since any question put on that subject might tend to incriminate the taxpayer by showing that the taxpayer had not complied with the initial obligation to return all sources of income. Such an argument would totally stultify the collection of income tax.
Relevantly also, there is no limitation imposed by s 353-10 on the use of incriminating information which is obtained through the s 353-10 process.
25 The circumstance that the privilege could not be claimed in response to a s 353-10 notice was central to the reasoning of the primary judge that the interests of justice were against making an order under s 128A(6) that the privilege affidavit be filed and served. Also central to the primary judge's reasoning was the primary judge's view that there was not a real risk that it would constitute a contempt of court for the DCT to exercise his powers under s 353-10 to obtain the information contained in the privilege affidavit. In holding that it was not in the interests of justice to require disclosure of the privilege affidavit because the DCT had available to him a statutory power which abrogates the privilege against self-incrimination, the primary judge acted on a wrong principle and the exercise of weighing the interests of justice was affected by a material error.
26 First, it is pertinent to bear in mind the issue here was whether it is in the interests of justice to require Mr Shi to disclose the privileged information to the DCT pursuant to the disclosure order made under r 7.33(1) of the Rules as an aid to the freezing order which the DCT obtained against Mr Shi. Sub-rule 7.33(1) must be read in conjunction with r 7.32 of the Rules, which, together with s 23 of the FCA Act, provide the statutory basis for the Court's power to make freezing orders and asset disclosure orders ancillary to the making of freezing orders. Sub-rule 7.33(2) provides that an ancillary order may be made for the purpose of eliciting information relating to assets relevant to the freezing order.
27 Rule 7.32 of the Rules provides:
(1) The Court may make an order (a freezing order), with or without notice to a respondent, for the purpose of preventing the frustration or inhibition of the Court's process by seeking to meet a danger that a judgment or prospective judgment of the Court will be wholly or partly unsatisfied.
(2) A freezing order may be an order restraining a respondent from removing any assets located in or outside Australia or from disposing of, dealing with, or diminishing the value of, those assets.
28 Rule 7.33 of the Rules provides:
(1) The Court may make an order (an ancillary order) ancillary to a freezing order or prospective freezing order as the Court considers appropriate.
(2) Without limiting the generality of subrule (1), an ancillary order may be made for either or both of the following purposes:
(a) eliciting information relating to assets relevant to the freezing order or prospective freezing order;
(b) determining whether the freezing order should be made.
29 It is well-settled law that the purpose of an asset disclosure order, just as the purpose of a freezing order, is to prevent frustration or abuse of the Court's process in relation to matters coming within its jurisdiction: Witham v Holloway [1995] HCA 3; 183 CLR 525 at 535 per Brennan, Deane, Toohey and Gaudron JJ, citing Jackson v Sterling Industries Ltd [1987] HCA 23; 162 CLR 612 (Jackson v Sterling Industries) at 623 per Deane J. A requirement for making a freezing order is proof (at least on a prima facie basis where the application is made ex parte) that there is a danger of removal of assets from the jurisdiction, or dissipation of assets needed to meet any judgment the applicant has obtained or might obtain: r 7.32 of the Rules; Jackson v Sterling Industries. An asset disclosure order serves the purpose of identifying the respondent's assets and the utility of the affidavit is to assist in ensuring that the Court's processes for enforcement of a judgment are not frustrated by assets being dissipated between the time of commencement of proceedings and eventual enforcement: Pathways at 346 [41]. Whilst the function of a freezing order is not to provide security in respect of a judgment, freezing orders may continue to operate after final judgment to preserve assets and assist and protect the use of methods of execution: Jackson v Sterling Industries at 623 per Deane J.
30 In the present case, in granting the freezing orders and asset disclosure order, Yates J was satisfied on the evidence presented that:
… the Commissioner had established against each respondent a strong prima facie case of at least prospective indebtedness for a very large sum in respect of his or her tax liabilities. I was also satisfied that the facts and circumstances surrounding each respondent's taxation affairs (including, on the Commissioner's case, an apparently deliberate failure to disclose taxable income), and each respondent's ability to access and transfer offshore large sums to other entities which he or she controls or with which he or she has an association, established that there is a real (as opposed to a supposed) danger that a judgment or prospective judgment obtained against him or her might be wholly or partly unsatisfied because assets (in particular, liquid assets) might be removed from Australia or otherwise disposed of or dealt to the disadvantage or detriment of the Commonwealth. I was satisfied that the balance of convenience favoured the grant of the relief sought and that it should be granted on an ex parte basis.
See Deputy Commissioner of Taxation v Shi [2018] FCA 1915 at [20]. Whilst the DCT has since obtained judgment against Mr Shi, the freezing orders have not been discharged and remain in force and the purpose of the making of the freezing orders remains extant.
31 Significantly, in balancing the interests of justice, it is a relevant consideration that the DCT did not seek to rely on his s 353-10 power to obtain the information from Mr Shi about his assets in lieu of seeking disclosure of the privilege affidavit. To the contrary, the DCT contended that he should not be required to rely on his s 353-10 power in circumstances where the asset disclosure order was made in aid of the freezing orders which the DCT obtained against Mr Shi, the freezing orders remained in place, there had been no application to discharge those orders and there was a judgment of the Court which had identified a real danger of dissipation of assets and a shortfall of Australian assets against Mr Shi's total outstanding tax liability of $42 million: the DCT's supplementary submissions in the court below at [15]. In the court below, the DCT submitted that in those circumstances, compliance with the asset disclosure order was in the interests of justice to enable identification of the assets subject to the freezing orders and to verify whether the freezing orders had been complied with, and a determination of the interests of justice was not affected by what other powers the DCT may now have available to him. The wider use of the information if the DCT was unconstrained by s 128A(8) of the Evidence Act was extraneous to the purpose of the asset disclosure order obtained by the DCT and the DCT did not seek to rely on the privilege affidavit beyond the present proceeding. Moreover, whilst in an appropriate case the interests of justice may involve considerations wider than the particular interests of the parties and include matters pertaining to the public interest more generally, there was nothing to suggest that the wider public interest in this case should override the interests of the DCT in obtaining full disclosure of the assets of Mr Shi in aid of the freezing orders obtained. The DCT's power to compel the provision of information under s 353-10 of Sch 1 of the TAA does not provide the same mechanism for enforcing immediate compliance with the freezing orders, but is a significantly different process and the primary judge wrongly failed to take such differences into account in the assessment of the interests of justice. The error is not, as the DCT characterised it, the taking into account of an irrelevant consideration but, rather, the failure to take into account a relevant consideration bearing upon the question of the interests of justice.
32 Secondly, the primary judge formed the view there would be no legal impediment to the DCT using his s 353-10 power to obtain the same information which the Court ordered by the asset disclosure order on the erroneous basis that the question of contempt would only arise if there were criminal proceedings against Mr Shi on foot. De Vonk and Watson v Commissioner of Taxation [1999] FCA 1796; 96 FCR 48, to which His Honour referred, were both cases where the Commissioner sought to use his cognate power under the former s 264 of the Income Tax Assessment Act 1936 (Cth) to obtain information from taxpayers concerning the same factual matters which were the subject of criminal proceedings brought against them. However, it is not only in the circumstance of parallel criminal proceedings that the use of the s 353-10 power may constitute a contempt. The principle which informs contempt of court is the interference with the due administration of justice and the principle applies equally to the use of a coercive information gathering power in the context of civil proceedings: Pioneer Concrete Pty Ltd v Trade Practices Commission [1982] HCA 65; 152 CLR 460 (Pioneer Concrete); Kotan Holdings Pty Ltd v Trade Practices Commission (1991) 30 FCR 511. In Pioneer Concrete, one of the issues was whether notices issued under s 155 of the Trade Practices Act 1974 (Cth) (Trade Practices Act) (being a cognate power to s 353-10) by the Trade Practices Commission to the appellant, in relation to the same subject matter of pending civil proceedings instituted by another company under the Trade Practices Act against the appellant, constituted an exercise of judicial power and an interference with judicial proceedings. It was held that the s 155 power was not an exercise of judicial power and was capable of being exercised. The Court left open the question as to whether it constituted a contempt but, relevantly, Gibbs CJ observed at 467-8 that if the power was used to assist a party in proceedings already pending in a way that would give that party advantages which the rules of procedure would otherwise deny them, there would be a contempt of court. See also Korean Airlines v Australian Competition and Consumer Commission (No 3) [2008] FCA 701 at [104]. Applying these principles, in circumstances where the DCT has obtained the asset disclosure order and there is an affidavit of assets sworn by Mr Shi in respect of which he has claimed the privilege against self-incrimination, it is arguable that the DCT's use of the power might be contempt or, at the least, an abuse of process, if used to enable the DCT to overcome the limitation on use and protection provided to Mr Shi by s 128A of the Evidence Act.
33 Thirdly, and more fundamentally, it was not suggested that there was any reason for the DCT to exercise his power under s 353-10 other than to enable the DCT to get the information in the privilege affidavit without the limitations on use imposed by s 128A(8). Instead of requiring disclosure of the privilege affidavit to the DCT and granting Mr Shi a certificate under s 128A(7), which would afford Mr Shi some protection in relation to the use of the information, the use of the s 353-10 process would negate Mr Shi's entitlement to rely on the privilege against self-incrimination and circumvent the restrictions on the use of the information prescribed by s 128A(8). Mr Shi would be obliged to comply with the notice, regardless of the privilege which the Court has already held was well-founded, with the failure to comply constituting an offence under ss 8C and 8D of the TAA. Adopting the words of Campbell J in Pathways at 346 [39], it would be a wrong exercise of discretion to cut down a privilege against self-incrimination in circumstances where the legislature has not clearly indicated it is appropriate to cut the privilege down.