Director of Public Employment v PSAPOA of New South Wales on behalf of its members Julius Tupua and Kerryn Shearman

Children (Detention Centres) Act 1987 Crown Proceedings Act 1988 LEGISLATION CITED: Independent Commission Against Corruption Act 1988 Industrial Relations Act 1996 Ombudsman Act 1974 Public Sector Employment and Management Act 2002

Abigroup v Akins (1997) 42 NSWLR 623 Akins and Others v Abigroup Ltd (1998) 43 NSWLR 539 Australian Competition & Consumer Commission v Telstra Corporation Ltd (2000) 96 FCR 317 Bailey v Australian Broadcasting Corporation (1995) 1 Qd R 476 Bailey v Marinoff (1971) 125 CLR 529 Bhattacharya v Director-General of Department of Education & Training [2000] NSWCA 74 Central Queensland Cement Pty Ltd v Hardy (1989) 2 Qd R 509 Complete Technology Pty Ltd v Toshiba (Australia) Pty Ltd (1994) 53 FCR 125 Crest Homes P/L v Marks [1987] 1 AC 829 CASES CITED: Esso Australia Resources Limited and Others v Plowman and Others (1994-1995) 183 CLR 10 Home Office v Harman (1983) 1 AC 280; (1982) 1 All ER 532 KBRV Resort Operations Pty Ltd t/as Kingfisher Bay Resort and Village v Chilcott (2001) 51 NSWLR 516 "Kronprinz", Owners of the Cargo of the v Owners of the "Kronprinz" (The "Ardandhu") (1887) 12 App Cas 256 K v NSW Ombudsman [2000] NSWSC 771 Liberty Funding Pty Ltd v Phoenix Capital Ltd [2005] FCAFC 3 Moage (in liq) v Jagelman and Others [2002] NSWSC 953 MP v Director General of Education & Training [2006] NSWSC 1041 Nilsen Industrial Electronics Pty Ltd National Semiconductor Corporation and Others (1994) 48 FCR 337 Springfield Nominees Pty Limited and Others v Bridgelands Securities Limited and Others (1992) 38 FCR 217 Statebank of South Australia v Smoothdale Limited (No 2) (1995) 64 SASR 224

Applicant: Ms T Anderson, of counsel Solicitors: Employment Relations and Professional Conduct, LEGAL REPRESENTATIVES: Department of Juvenile Justice

Respondent: Mr I Neil, SC, with Mr D Chin, of counsel Solicitors: WG McNally Jones Staff and Co

Public Service Association and Professional Officers Association Amalgamated Union of NSW on behalf of its member Julius Tupua v Director of Public Employment by his agent the Director-General of the Department of Juvenile Justice

Application under s 84 of the Industrial Relations Act 1996

Public Service Association and Professional Officers Association Amalgamated Union of New South Wales on behalf of its member Kerryn Shearman v Director of Public Employment by his agent the Director-General of the Department of Juvenile Justice

Application under s 84 of the Industrial Relations Act 1996

1 The applicant (Director of Public Employment by his agent the Director-General of the Department of Juvenile Justice) has applied for leave of the Commission by way of notices of motion for orders to use witness statements and an affidavit for purposes other than for the conduct of the proceedings for which the statements and affidavit were created. The applications proceed upon the basis that the documentation sought is subject to implied undertakings from which release must be granted by the Commission before the documentation may be used for the purposes intended. 2 The applicant alleges that the documents contain allegations of possible misconduct within the meaning of s 43(1) of the Public Sector Employment and Management Act 2002 (the PSEMA) made against a number of officers working for the Department of Juvenile Justice. Leave of the Commission is sought so that the allegations may be the subject of, "...consideration and, where appropriate, inquiry and/or investigation and notification to the Independent Commission against Corruption", (the ICAC). 3 The proceedings to which the notices of motion purport to be connected concern two earlier applications brought by the Public Service Association and Professional Officers Association Amalgamated Union of New South Wales (the respondent) on behalf of two of its members, Julius Tupua and Kerryn Shearman. Those applications alleged that termination of employment was harsh, unreasonable or unjust following the respective dismissals from employment of the two members in unrelated circumstances. The Commission has been advised that the witness statements in the Tupua matter were filed and served upon the applicant (the respondent in the unfair dismissal proceedings) but the proceedings were settled on the first day of the hearing following legal argument. In the Shearman matter, an affidavit of Ms Shearman annexing a copy of a letter from a female detainee at Yasmar Juvenile Justice Centre to a male detainee at Orana Juvenile Justice Centre, was served on the applicant (the respondent in the unfair dismissal proceedings). Sometime prior to the hearing, those proceedings were also settled. 4 The statements and affidavit in both matters were not adduced into evidence in the unfair dismissal proceedings. The question for determination here is whether in those circumstances the Commission will grant leave to the applicant to consider, make inquiries, investigate and notify the ICAC of the allegations. 5 The documents served in the Tupua matter and the Shearman matter pending the unfair dismissal proceedings were tendered on the present applications for the limited purposes associated with the applications and without otherwise affecting any confidentiality or privilege which might attach to the documents. 6 In the Tupua matter, the statements suggest that certain unnamed officers working at Cobham Juvenile Justice Centre slept while on night duty, filled in record books before performing checks of inmates as required, and otherwise failed to perform necessary checks of detainees. According to one of the statements, officers had engaged in certain misconduct which included assaults on detainees, theft and bringing contraband into the detention centre. The applicant contends that the allegations against the unnamed officers raise questions in relation to the safety and proper supervision of detainees under s 14(1) of the Children (Detention Centres) Act 1987 and that the allegations constitute misconduct as defined in s 43(1) of the PSEMA as well as "corrupt conduct" as defined in s 9(1) of the Independent Commission Against Corruption Act 1988 (the ICAC Act). 7 In the Shearman matter, Ms Shearman's affidavit outlines how she discovered the female detainee's letter (a copy of which is annexed to the affidavit). According to Ms Shearman she discovered the original letter in an old backpack which was stored near the end of her bed. She read the letter and subsequently provided it to a Mr Andrew Wilson from the Public Service Association. She mentions that her partner at the time, an employee of the Department of Juvenile Justice, told her that the writer of the letter had given him a letter to give to another detainee but that he had left the letter on the Unit Coordinator's desk at Yasmar Juvenile Justice Centre. The letter makes mention of a worker at Yasmar called "Micheal" (sic) who also works at Orana and who has promised the writer that he will deliver the letter to the intended recipient at Orana. According to the applicant the circumstances in which the letter came into Ms Shearman's possession raise questions as to whether there was an attempt by the writer of the letter to communicate with another detainee without the necessary departmental approval, and, whether Ms Shearman's partner was associated with any such attempt. Without any further information the applicant contends that it is not possible to know whether Ms Shearman's partner may have engaged in misconduct within the meaning of s 43(1) of the PSEMA or s 9(1) of the ICAC Act. Further that s 11 of the latter Act provides that a principal officer of a public authority (such as the applicant) is under a duty to report to the ICAC any matter that the officer suspects on reasonable grounds concerns, or may concern, corrupt conduct, but that by reason of the implied undertaking the State of New South Wales is presently prevented from complying with the provision. In addition s 25C of the Ombudsman Act 1974 is invoked by the applicant as also requiring compliance with similar reporting conditions. 8 The respondent opposes the applications on a number of grounds. The respondent's primary contention is that the statements and affidavit, the subject of both applications, are subject to client legal privilege and that disclosure by way of service of copies of the documents to the applicant in the unfair dismissal proceedings does not constitute a waiver of the privilege. In the alternative, the respondent contends that the applicant has not made out any special circumstances which it is required to do before the Commission may release it from the implied undertakings. The respondent also opposes the applications on a number of grounds raised in oral submissions. In the Shearman matter the respondent contends that the Commission lacks jurisdiction to entertain the application because the proceedings were discontinued before the notice of motion was filed. No proceedings are therefore on foot. In relation to both applications the respondent contends first that the applications seek relief on behalf of the State of New South Wales, a different entity from the applicant. The applicant therefore has no standing to appear on behalf of that entity, nor does the State of New South Wales have any standing itself to make the applications. Secondly the respondent contends that both applications are fatal because of their extraordinary width both as to the range of materials in respect of which leave is sought, particularly in relation to the fourth order sought in each notice of motion. That order, in identical terms in both notices of motion, reads in full:

An order that leave be granted to the State of New South Wales to use (the documents) for purposes other than the proceedings, namely:

(4) taking any action that might arise as a consequence of such consideration (of allegations of misconduct), investigation and/or notification. 9 I propose to consider first the last three mentioned contentions. Consequences of discontinuance of proceedings in Shearman matter

10 It was common ground between the parties to the present application in the Shearman matter that the unfair dismissal proceedings were discontinued sometime prior to the filing of the notice of motion. Although the Commission was not directed to any notice of discontinuance, it is reasonable to assume, given that the discontinued proceedings were unfair dismissal proceedings under Part 6 of Chapter 2 of the Industrial Relations Act 1996, that the proceedings were discontinued under the relevant Industrial Relations Commission Rules 1996 (the IRC Rules). The relevant rules for present purposes would appear to be Rules 138, 141 and 143. Those rules provide:

Section 138. (1) A party may, before the beginning of the hearing of any proceedings, discontinue the proceedings so far as concerns the whole or any part of any application made by that party: (a) where the party or the party's solicitor certifies that the party does not represent any other person and all other parties having an address for service in the proceedings consent, or (b) with the leave of the tribunal.

(2) Leave of the tribunal may be given in Chambers without the appearance of any person.

Section 141. (1) Except with leave of the tribunal, a discontinuance or withdrawal under Rule 138 or Rule 139 must be made by filing a notice stating the extent of the discontinuance or withdrawal.

(2) Where the discontinuance or withdrawal is by consent, the notice under subrule (1) must bear the consent of each consenting party.

Section 143. A discontinuance under this Division as to any cause of action does not, subject to the terms of any leave to discontinue, prevent a person from bringing fresh proceedings or claiming the same relief in fresh proceedings. 11 The applicant relies on Rule 88(1) of the IRC Rules in support of its contention that the Commission has jurisdiction to decide the present applications. That Rule provides:

(1) Application to a tribunal to waive strict compliance with any procedural requirement or to exempt any party from compliance with any such requirement either before or after the occasion for compliance arises, may be made by notice of motion or orally in the course of the proceedings and if made separately must, unless the tribunal otherwise directs, be supported by affidavit. 12 Rule 68 of the IRC Rules provides that unless a tribunal directs, "an interlocutory or other application in relation to proceedings must be made by way of notice of motion". 13 In my opinion an obvious flaw in the respondent's contention is that any implied undertakings in relation to statements for example cannot cease to exist because the proceedings for which the statements were created have been discontinued. It follows that discontinuance of proceedings under the IRC Rules cannot have the result for which the respondent contends, namely that upon discontinuance they cease to exist or are no longer on foot, such as to preclude applications of the present kind. There is support for this in a number of authorities. In "Kronprinz", Owners of the Cargo of the v Owners of the "Kronprinz" (The "Ardandhu") (1887) 12 App Cas 256, an action for damages was brought by the shipowners of the Kronprinz arising out of a collision with the Ardandhu. The parties agreed that the action be "discontinued without costs on the ground of inevitable accident" and formal orders were drawn up. The issue before the House of Lords was whether the order discontinuing the action by the Kronprinz shipowners was a bar to further action taken by them in the same proceedings to claim damages, specifically a share of a fund paid into Court by the owners of the Ardandhu following a successful action for damages by the owners of the cargo of the Kronprinz against the owners of the Ardandhu. The House of Lords held that discontinuance of the proceedings was not a bar to a further claim for damages by the owners of the Kronprinz. Lord Bramwell said (at 260, 261):

If the claim of the Kronprinz against the Ardandhu is in existence, the owners of the Kronprinz have a right, as it seems to me, to share in the fund which has been brought into Court. If it is not in existence, of course they have no right to do so. That reduced the question to this, Is the claim in existence? It is said that it is not; partly as I understand, by the effect of the order of discontinuance. I can see nothing in the order of discontinuance which, by what you may call its intrinsic effect, would bar a claim of the owners of the Kronprinz.

But then it is said that there was a bargain between the parties which is embodied in that order, and that the bargain is operative to prevent the owners of the Kronprinz claiming against this fund. As I have said, that can only be because that bargain has extinguished the right. But has it? We have not the slightest evidence of any agreement between the parties that the claims on the one side should be given up in consideration of the claims of the other being given up. 14 In the present application the Commission's attention has not been directed to any condition of the notice of discontinuance to the effect that no other action should be brought. I intend to proceed therefore on the basis that no such condition attached to the notice of discontinuance. 15 Kronprinz has been followed and applied by the New South Wales Court of Appeal in KBRV Resort Operations Pty Ltd t/as Kingfisher Bay Resort and Village v Chilcott (2001) 51 NSWLR 516. The notice of discontinuance under consideration in that decision was filed in the District Court in accordance with a similar rule to Rule 138. Thereafter the proceedings were sought to be transferred to the Supreme Court. Sheller JA (with whom Ipp A-JA and Grove A-JA agreed) found that although the notice of discontinuance terminated the action in the District Court it did not follow that the proceedings had ceased to exist or were no longer on foot. Accordingly the Court of Appeal found that the proceedings, although discontinued, could be transferred to the Supreme Court. Sheller JA said (at 528):

[T]he fact that the notice of discontinuance, though irregular, was effective to terminate the whole action does not mean that thereafter there were no proceedings between the parties which could be removed into the Supreme Court. The discontinuance could be rescinded as in the Owners of the Cargo of the "Kronprinz" not in separate proceedings but in the proceedings in which the notice was filed. The proceedings did not cease to exist but remained. Further steps could be taken by the parties in the proceedings such as rescission of the notice of discontinuance or removal into the Supreme Court. Whether such order should be made was of course another question. In the present case the discontinuance can be rescinded in the Supreme Court. 16 It follows in my opinion from the above authorities and on the basis that no condition attached to the notice of discontinuance which might preclude further action, that the notice filed in the Shearman matter remains on foot and that the Commission is at liberty to hear the application. I should add before leaving this issue that the respondent also placed some reliance on the High Court judgment of Bailey v Marinoff (1971) 125 CLR 529 for its contention that by reason of the notice of discontinuance the proceedings in the matter are no longer on foot. On my reading of that judgment however, the High Court was concerned rather with the consequences of final orders or perfected orders which have the effect of dismissing an appeal thereby bringing the proceedings to an end (see Menzies J at 531). Whether the applicant has standing to seek relief on behalf of the State of New South Wales.

17 The respondent also contends that a fatal feature of both notices of motion is that relief is sought on behalf of the State of New South Wales, an altogether different entity from the applicant and that consequently the applicant has no standing to bring the applications. 18 This contention can only have merit if the State of New South Wales is in fact a different entity from the present applicant. The issue may be resolved by resort to both the provisions of the PSEMA and the Crown Proceedings Act 1988 (CPA). Section 121 of the PSEMA creates the position of the Director of Public Employment and states that the position is to be held by the Director-General of the Premier's Department. Under s 129 of that Act the Director of Public Employment is, for the purpose of industrial proceedings relating to officers, employees etc., taken to be the employer of staff of the Public Service. (I interpolate here that unfair dismissal proceedings under the Industrial Relations Act and ancillary or interlocutory proceedings related thereto, would fall into the category of industrial proceedings). Under s 6 of the PSEMA the Public Service is defined in Part 1 of Schedule 1 of the Act. Under Part 1 of Schedule 1 the Premier's Department, with the Divisional Head nominated as the Director-General of the Department, is listed as a Public Service Department, and a division of the Government Service. Under s 4 of the PSEMA the Government Service is said to consist of persons employed by the Government of New South Wales in the service of the Crown. Section 3 of the CPA provides that "Crown" means Crown in right of New South Wales and includes the Government of New South Wales. Section 4 of the CPA provides that the Crown may bring civil proceedings under the title "State of New South Wales" against any person in any competent court. 19 It seems reasonably clear from the combined operation of these provisions that the Director of Public Employment and the State of New South Wales are one and the same entity. The applicant, as named, therefore has the requisite standing to seek relief. Whether orders sought in notices of motion are too wide

20 The respondent also contends that the notices of motion have been drafted in impermissibly wide terms both as to the range of materials sought and as to the terms of Order 4 sought under both notices of motion (reproduced above). As to the range of materials sought I do not necessarily agree that the notices of motion are drafted in such wide terms such that the orders sought, if granted, might permit the applicant to resort to all or any of the witness statements and any other material filed by the respondent (the applicant in the unfair dismissal proceedings). The actual documents sought are annexed to the affidavits accompanying both notices of motion on the present applications. The applications for release from the implied undertakings are restricted to those documents. Should there be any doubt however about which witness statements the applicants may be permitted to use in the event the Commission releases the applicant from the implied undertakings then any order for release will be restricted to only those witness statements annexed to the affidavit of Paul Raymond Robert Houston sworn on 7 November 2006 in relation to the Tupua matter and the affidavit of Ms Shearman annexed to Mr Houston's affidavit sworn on 7 November 2006 in the Shearman matter. 21 By adopting a similar approach to Order 4 in both notices of motion it is open to the Commission to formulate more specific orders. Order 4 is cast in such wide terms that if granted it would arguably be open to the applicant to interpret and apply the Order howsoever and to whomsoever it pleased. Rule 88(1) of the IRC Rules provides that applications may be made orally during proceedings to waive strict compliance with any procedural requirement or to exempt a party from compliance. The applicant suggested that the Commission could refashion Order 4 in both notices of motion if a view was formed that the Order was too wide. A more appropriate course, in my view, in the event the applications are successful, would be for the applicant to prepare short minutes of order reflecting the Commission's finding that Order 4 is too wide and should be cast in more specific terms. The implied undertakings

22 I turn now to consider the applications to use the documents for purposes unrelated to the unfair dismissal proceedings, which may be characterised as applications for release from the implied undertakings. 23 The leading authority on the implied undertaking is Home Office v Harman (1983) 1 AC 280; (1982) 1 All ER 532. In that case the House of Lords confirmed that documents obtained by discovery are subject to an implied undertaking which prevents their use for any collateral or related purpose other than for the proper conduct of proceedings in which the documents were obtained, except with the leave of the Court. The words "collateral or ulterior purpose" refer to a purpose not reasonably incidental to the conduct of the immediate action: Bailey v Australian Broadcasting Corporation (1995) 1 Qd R 476 at 484. In Harman their Lordships adverted to an underlying rationale for the principle being based on public policy considerations: see Lord Diplock at 304; Lord Keith of Kinkel at 308, 309; Lord Roskill at 326. Two such policy considerations are the right to privacy and confidence and the public interest in ensuring that justice is done between the parties: see Bailey v ABC at 484. 24 Although the authorities are not entirely clear as to when the undertaking ceases to apply, Mason P in Akins and Others v Abigroup Ltd (1998) 43 NSWLR 539 at 548 observed that it is "probably the law" in Australia that once information in documents is adduced into evidence it becomes part of the public domain unless the Court restricts its publication. Up to that point at least it seems that the implied undertaking continues to apply. The documents in question in the present applications have not been tendered and received into evidence and may therefore be subject to the implied undertakings on that basis. If so, they may not be used for any collateral or ulterior purpose except with the leave of the Commission. 25 In relation to the latter point it would appear that the principle applies to tribunal proceedings: see for example Esso Australia Resources Limited and Others v Plowman and Others (1994-1995) 183 CLR 10 at 33 per Mason CJ. The present proceedings are being conducted by the Commission. I note that neither party raised this matter as an issue during the hearing of the notices of motion. I therefore intend to proceed upon the basis that the implied undertaking applies to these proceedings and that the applicant requires the leave of the Commission to use the documents, the subject of both applications. 26 The application of the principle has been extended to witness statements and affidavits: Central Queensland Cement Pty Ltd v Hardy (1989) 2 Qd R 509 per McPherson J at 510; Springfield Nominees Pty Limited and Others v Bridgelands Securities Limited and Others (1992) 38 FCR 217 per Wilcox J; Abigroup v Akins (1997) 42 NSWLR 623 at 627-628. 27 In Crest Homes P/L v Marks [1987] 1 AC 829 Lord Oliver referred to the release of the implied undertaking being subject to special circumstances and where the release or modification will not occasion injustice to the person (at 860). The requirement to show special circumstances as a pre-condition for release has been adopted and applied in a number of Australian authorities: Springfield Nominees at 221, 224; Bailey v ABC at 485, 486; Akins v Abigroup at 549 ("exceptional circumstances"); Moage (in liq) v Jagelman and Others [2002] NSWSC 953 per Gzell J at [15]; Liberty Funding Pty Ltd v Phoenix Capital Ltd [2005] FCAFC 3 at [31]; Australian Competition & Consumer Commission v Telstra Corporation Ltd (2000) 96 FCR 317 at 321. 28 In Springfield Nominees Wilcox J nominated some factors which his Honour considered relevant to the exercise of the Court's discretion including (but are not limited to) the following (at 225):

(ii) the circumstances under which the document came into existence;

(iii) the attitude of the author and any prejudice that the author may sustain;

(iv) whether the document pre-existed litigation or was created for that purpose and therefore expected to enter the public domain;

(v) the nature of the information in the document (in particular whether it contains personal data or commercially sensitive information);

(vi) the circumstances in which the document came into the hands of the applicant seeking leave;

(vii) most importantly of all, the likely contribution of the document to achieving justice in the second proceeding. 29 The applicant in the present proceedings seeks leave of the Commission to use the documents in order to consider the allegations, make inquiries, undergo investigations into any alleged misconduct, notify the ICAC of any such allegations, and take any action that might arise as a consequence of its consideration, inquiries, investigation and/or notifications. In Bailey v ABC, Lee J considered whether the application for release from the implied undertaking should be granted in relation to the proposed use of documents for the purpose of disclosure to the criminal authorities for investigation in relation to whether or not the documents revealed the commission of criminal offences. His Honour identified the countervailing public interest as the need to locate and prosecute criminal offenders. In determining what weight to give to a public interest of that kind his Honour identified a number of factors for consideration in the exercise of the Court's discretion. These included:

(ii) the cogency of the evidence sought to be adduced in support of it;

(iii) the authority to which the documents are sought to be disclosed. 30 I propose to approach the present applications by reference to the factors identified by Wilcox J in Springfield Nominees and those identified by Lee J in Bailey v ABC where I consider those factors to be relevant to the present applications. The Tupua matter

31 The witness statements in the Tupua matter which the applicant seeks to use for the purposes stated in the notice of motion are made and signed by employees of the applicant. The statements were created for the purposes of the unfair dismissal proceedings. The makers of the statements (with the exception of one who was unable to be contacted) have each expressly objected to the use of their statements by the applicant for any purpose outside the original purpose for which the statements were created, namely for use in the unfair dismissal proceedings. They also state that they would not have provided the statements had they known that the statements might be made available or used for a different purpose such as disciplinary investigations by the applicant. Had the unfair dismissal application proceeded to hearing the statements or the information contained in the statements would not have been adduced into evidence. The statements do not contain any personal data or commercially sensitive information. Although the Commission was not advised as to whether the statements were filed and served on the applicant pursuant to orders of the Commission, it is reasonable to assume that the statements came into the applicant's possession as a result of such orders. The statements disclose allegations of serious misconduct, such as officers of the applicant working at juvenile detention centres sleeping while on duty and falsifying records by making entries both prospectively and retrospectively which purport to show that checks of detainees have been completed at the times recorded, when this was not the case. One statement adverts to assaults, theft and bringing contraband into the centre (although the allegations are made in very general terms). The other allegations set out in the statements do not specify the names of the employees concerned, nevertheless the allegations are clear and strongly suggestive of serious misconduct. The applicant intends, if applicable, to notify the ICAC of the allegations. The mechanism with which the ICAC may deal with such allegations is subject to formal procedures set out in detail in the ICAC Act. As such there is no possibility of misuse by the ICAC of the statements or of their contents. 32 The respondent relies on a number of reasons why leave should not be granted to the applicant to use the statements for purposes unrelated to the present proceedings. Granting the orders in the notice of motion, the respondent contends, would be contrary to the public interest in that it would discourage its members and employees generally from coming forward to provide assistance to the respondent, to its members and to the Commission. In addition the respondent says that granting the notice of motion would be contrary to the prompt, expeditious, just and equitable disposition of proceedings in the Commission. 33 The material disclosed in the statements in my view gives rise, prima facie, to serious misconduct. There is also a clear public interest in maintaining confidence in the administration of the public service generally, and, in particular, within that context, ensuring that children under the care and custody of the public service are not at risk to health and safety. Having had regard to the public interest considerations referred to in evidence by the respondent which include the right to privacy and confidence which resides in the makers of the statements, I am of the view that the countervailing public interest in investigating the allegations and, if appropriate, notifying the ICAC of these allegations and then taking any action that is deemed necessary overrides the public interest in ensuring privacy and confidence. I would therefore grant leave to the applicant in the Tupua matter to use the documents for the purposes anticipated in the notice of motion, subject to the orders being drafted in more specific terms. This finding is further subject to consideration as to whether the statements are nevertheless privileged. Mason P in Akins v Abigroup referred to the proposition (at 549) that client legal privilege is a right vested in the client which cannot be overridden if it subsists. His Honour observed in relation to the facts before the Full Court that, "...it is no answer to an otherwise subsisting client legal privilege to argue that Home Office v Harman is available as a back-up. Abigroup's invocation of privilege remains to be addressed on its own terms". I will consider this issue shortly. The Shearman matter

34 In the Shearman matter Ms Shearman has sworn an affidavit annexing a copy of the female detainee's letter addressed to a male detainee who at the time was apparently an inmate at another detention centre. Ms Shearman's affidavit came into existence for the purposes of the unfair dismissal proceedings, the letter annexed to the affidavit did not. Instead the letter pre-existed the litigation. It contains personal information. It appears that it was obtained by the applicant following an order from the Commission. Ms Shearman also objects to her affidavit and the contents therein being used for any purpose other than the purpose for which it was originally intended, namely for use in the unfair dismissal proceedings. Ms Shearman's affidavit contains an account of her discovery of the letter (in an old backpack) at her residence. She does not know how it came to be there. According to her, her then partner informed her that the female detainee had given him the letter to deliver to the intended recipient but that he had instead left it on the Unit Co-ordinators desk at Yasmar Juvenile Justice Centre. The female detainee's letter simply refers to someone called "Micheal" (sic) who she says will deliver the letter. Based on this material I am unable to form a view that it is of sufficient cogency to warrant granting the order for release in order to make inquiries and investigate the matter. This is especially so in the context of the very personal and confidential content of the letter as well as the fact that it was quite obviously not intended for use in any litigation. Ms Shearman's affidavit discloses no prima facie evidence of any misconduct on her part or on the part of anyone else. In these circumstances the public interest in preserving privacy and confidence outweighs the countervailing public interest in inquiring, investigating, notifying ICAC (and any consequent action deemed necessary) of any alleged misconduct. I therefore decline to grant leave to the applicant to be released from his implied undertaking in relation to Ms Shearman's affidavit and the annexure to that affidavit, namely the female detainee's letter. Whether the witness statements are the subject of privilege

35 It remains to consider whether the witness statements in the Tupua matter are the subject of client legal privilege or legal professional privilege. 36 The respondent's primary submission against the granting of both applications was that those documents were brought into existence for the sole purpose for use in the unfair dismissal proceedings and are therefore subject to client legal privilege. Disclosure by service of copies of the witness statements in the Tupua matter pursuant to directions of the Commission does not, according to the respondent, constitute a waiver of the privilege. Where, as in the present case the privilege is asserted, it prevents any use of the statements for any purpose not connected with the present proceedings. 37 The applicant, although expressing initial surprise that the principle could have any relevant application to the present circumstances, later contended that a number of statutory provisions upon which the applicant is entitled to rely, effectively operate to require the respondent to produce the documents in question. 38 In particular the applicant relied on s 37(2) of the ICAC Act. That section provides:

(2) A witness summoned to attend or appearing before the Commission at a compulsory application or public inquiry is not excused from answering any question or producing any document or other thing on the ground that the answer or production may incriminate or tend to incriminate the witness, or on any other ground of privilege, or on the ground of a duty of secrecy or other restriction on disclosure, or on any other ground. 39 The applicant did not direct the Commission's attention to any cases which have dealt with the section. In my opinion if a document is the subject of client legal privilege for example then, clearly that privilege subsists regardless of the section. All the section does, within the narrow context of either a compulsory examination or public inquiry before the ICAC, is require a witness to produce a document even if that document is otherwise privileged. In other words the section itself, in its terms, is of no relevance to a finding by this Commission that a particular document is the subject of privilege. Further the section has a restricted operation which is illustrated by the terms of s 37(3) of the ICAC Act. That section provides:

(3) An answer made, or document or other thing produced, by a witness at a compulsory examination or public inquiry before the Commission is not (except as otherwise provided in this section) admissible in evidence against the person in any civil or criminal proceedings or in any disciplinary proceedings. 40 Even if therefore, s 37(2) were to be invoked, its operation is circumscribed by s 37(3) and for the purposes of any criminal or disciplinary proceedings any documents or information in which client legal privilege subsists which have been produced or provided under s 37(2) are not admissible in those proceedings. The restrictions imposed under s 37(3) may well, in turn have potential impact upon the purposes for which the documentation is being sought. 41 The applicant also relied on s 25C and s 25D of the Ombudsman Act. As I understand the applicant's submissions in relation to those particular provisions, they are put forward in support of the applicant's contentions concerning the applications for release from the implied undertaking as well as a submission that the provisions operate to override client legal privilege. In relation to the issue of client legal privilege the applicant submits that the provisions confer the power to disclose to the Ombudsman any information that gives the head of a government agency reason to believe that "reportable conduct" has occurred. According to the applicant if it is not permitted to make the disclosure then the maintenance of client legal privilege has paramountcy over the safety of children (the detainees at the juvenile justice centres) whose safety is at risk because of the alleged misconduct of the applicant's officers working at those centres, and that this would be an inconceivable result. 42 Sections 25C and 25D provide:

25C (1) The head of a designated government or non-government agency must notify the Ombudsman of the following: (a) any reportable allegation, or reportable conviction, against an employee of the agency of which the head of the agency becomes aware, (b) whether or not the agency proposes to take any disciplinary or other action in relation to the employee and the reasons why it intends to take or not to take any such action, (c) any written submissions made to the head of the agency concerning any such allegation or conviction that the employee concerned wished to have considered in determining what (if any) disciplinary or other action should be taken in relation to the employee. (2) The notification must be made as soon as practicable and, in the case of the notification of a reportable allegation or reportable conviction, must be made, in any event, within 30 days of the head of the agency becoming aware of the allegation or conviction (or within such further period as may be agreed to by the Ombudsman). (3) The head of the agency must make arrangements within the agency to require employees of the agency to notify the head of the agency of any such reportable allegation or conviction of which they become aware.

25D (1) The head or other employee of a designated government or non-government agency may disclose to the Ombudsman or an officer of the Ombudsman, any information that gives the head or other employee reason to believe that reportable conduct by an employee of the agency has occurred. 43 A reportable allegation means an allegation of reportable conduct against a person or an allegation of misconduct that may involve reportable conduct. Reportable conduct is defined in the Act as:

"reportable conduct" means: (a) any sexual offence, or sexual misconduct, committed against, with or in the presence of a child (including a child pornography offence), or (b) any assault, ill-treatment or neglect of a child, or (c) any behaviour that causes psychological harm to a child, whether or not, in any case, with the consent of the child. Reportable conduct does not extend to: (a) conduct that is reasonable for the purposes of the discipline, management or care of children, having regard to the age, maturity, health or other characteristics of the children and to any relevant codes of conduct or professional standards, or (b) the use of physical force that, in all the circumstances, is trivial or negligible, but only if the matter is to be investigated and the result of the investigation recorded under workplace employment procedures, or (c) conduct of a class or kind exempted from being reportable conduct by the Ombudsman under section 25CA. 44 In my view the witness statements do not contain allegations of misconduct which might constitute reportable conduct as defined in the Act. One witness statement makes oblique reference to unnamed officers who have not been dismissed from employment for what the author of the statement considers to be conduct which is not specified but is said to include assaults on detainees, theft and bringing contraband into one of the detention centres. Given the vague terms in which this conduct is expressed it would appear unlikely that any obligation would arise to report an allegation as required under s 25C. Moreover because the allegations made in the various witness statements are at large and not directed specifically towards any person the applicant expressed some doubt as to the application of the section to the present circumstances. 45 The applicant contended that the provisions of the Ombudsman Act are sufficient to override any right to client legal privilege that might otherwise subsist in the authors of the witness statements. Two decisions were relied upon by the applicant which have held that s 25C (and other provisions of the Ombudsman Act which also deal the allegations of misconduct towards children) imposes an absolute obligation on the head of a designated government or non-government agency to notify the Ombudsman in relation to any allegations which fall under the terms of the section: K v NSW Ombudsman [2000] NSWSC 771 per Whealy J at [67]; MP v Director General of Education & Training [2006] NSWSC 1041 per Gzell J at [14]. 46 The difficulty I have with this particular submission is that the Ombudsman Act does not appear to contain any relevant provisions that either expressly or impliedly purport to abrogate client legal privilege or legal professional privilege. Section 25H provides some protection in the event of disclosure of information under Part 3A of the Act. Section 25H(2) provides that in the event of disclosure of information under Part 3A (which includes s 25D), no liability, "...for defamation or other civil liability is incurred because of the disclosure". There is a presumption that state law does not override common law or invade common law rights unless there is a clear statement of statutory intent: see for example Bhattacharya v Director-General of Department of Education & Training [2000] NSWCA 74 at [17]. In the absence of any such clear statutory intention there is no basis for a finding that client legal privilege has been overridden or abrogated by the statutory regime concerning reportable allegations and reportable conduct under the Ombudsman Act. 47 The question remaining for determination is whether the witness statements are in fact the subject of client legal privilege. I have little doubt that they are. There are a number of authorities which deal with the issue. Some of the earlier authorities were collected by Lindgren J in ACCC v Telstra (at 322). In the first of these, Nilsen Industrial Electronics Pty Ltd National Semiconductor Corporation and Others (1994) 48 FCR 337 the first respondent sought discovery of the applicant in the Federal Court proceedings of witness statements that the applicant had provided to another party during proceedings in the Supreme Court of Victoria. It was common ground that in the Supreme Court proceedings the witness statements had been filed and served but not adduced into evidence as the proceedings had settled on the first day of hearing. The applicant contended on this basis that the witness statements attracted legal professional privilege. Olney J agreed, finding that until witness statements become part of the evidence in the relevant proceedings they remain privileged. Accordingly his Honour declined to order that the applicant give discovery of the statements. 48 Lindgren J in ACCC v Telstra also referred to Complete Technology Pty Ltd v Toshiba (Australia) Pty Ltd (1994) 53 FCR 125 in which a different conclusion was reached by Hill J who expressly disagreed with the reasoning of Olney J and held that any privilege in the witness statements there under consideration had been waived by their delivery. The reasoning of Olney J was followed by the Full Court of the Supreme Court of South Australia in Statebank of South Australia v Smoothdale Limited (No 2) (1995) 64 SASR 224. In that decision seven witness statements had been brought into existence for the purpose of litigation in the Supreme Court of New South Wales. The appellant in the South Australian Supreme Court sought an order requiring the respondent to produce the statements. The respondent objected to the production on the ground that the statements were the subject of legal professional privilege. King CJ with whom Mullighan and Nyland JJ agreed, held after examining the conflict in the authorities, that the statements, delivered pursuant to orders of the Court, were the subject of privilege which had not been waived. Privilege had not been waived because the statements had been delivered pursuant to orders of the Court but had never been adduced into evidence and therefore had not entered the public domain. There had been only a limited waiver of the privilege insofar as was necessary to permit the statements to be used for the purposes of the case in which they were delivered, that is the Supreme Court proceedings in New South Wales. 49 In Abigroup Ltd v Akins, Bainton J reached the same conclusion in relation to the filing and serving of witness statements pursuant to a Court order. The notice of motion before Bainton J moved for orders including an order that the plaintiff make available for inspection by the defendant statements "whether or not filed or served" in other nominated proceedings. On appeal, the New South Wales Court of Appeal in Akins v Abigroup affirmed the decision of Bainton J. Mason P referred to the implied undertaking as requiring strangers to litigation who seek access to documents such as witness statements in any proceedings having to seek the leave of the Court. The appellants (Deloittes) had contended before the Court of Appeal that the principle of the implied undertaking provided sufficient protection to the witness statements such that there was no necessity to invoke the principle of client legal privilege. His Honour disagreed, making the following observations (at 549):

The principle in Home Office v Harman has been expressed as embodying a duty of confidentiality upon the party subject to the implied duty not to make collateral use of documents produced by one litigant party to another. I have stated that Deloittes' submission involving Home Office v Harman proves too much and too little. Deloittes' submission proves too much, because the principle in Home Office v Harman extends to all categories of disclosed documents or things, whether attracting client legal privilege or otherwise: Prudential Assurance Co Ltd v Fountain Page Ltd [1991] 1 WLR 756 at 765. Conversely, the submission proves too little, because it fails to give due effect to the proposition that client legal privilege is a right vested in the client which cannot be over-ridden if it subsists. The fundamental and enduring nature of the privilege is illustrated in the High Court's recent decision in Carter v Managing Partner, Northmore Hale Davy & Leake , which held that it cannot be over-ridden even to establish innocence of an accused person. The protection afforded by Home Office v Harman falls significantly short of this, because the court may give leave permitting the collateral use of documents subject to an implied Home Office v Harman undertaking. Even though it is inconceivable that leave would be given in relation to a privileged document, the possibility that it might (according to Home Office v Harman ) shows that privilege and Home Office v Harman are in different realms of discourse.

Accordingly, it is no answer to an otherwise subsisting client legal privilege to argue that Home Office v Harman is available as a back-up. Abigroup's invocation of privilege remains to be addressed on its own terms. 50 The conclusions reached in the above authorities as to the privilege attaching to witness statements filed and served or delivered, but not received into evidence were also based on the fact that the statements had been filed and served pursuant to court orders, that is, compulsory as opposed to voluntary disclosure. Similarly, in the present circumstances it was common ground between the parties that the witness statements in the Tupua matter were filed and served pursuant to orders of the Commission. 51 In Liberty Funding Pty Ltd v Phoenix Capital Ltd the Full Court of the Federal Court expressed doubts as to the correctness of the decisions in Smoothdale and Akins v Abigroup (at [24]), insofar as those authorities dealt with the question of waiver at common law by service of witness statements or affidavits in advance of a trial. The Full Court however did not decide the issue having found it unnecessary to do so. 52 In light of the abovementioned authorities I find that the witness statements in the Tupua matter, which were filed and served pursuant to orders of the Commission, but not adduced into evidence, are the subject of client legal privilege or legal professional privilege which has not been waived except for the limited purpose of compliance with the Commission's orders. They are therefore inaccessible to the applicant for the purposes for which the application has been made, namely for consideration, inquiry, investigation, notification to the ICAC and the taking of any action in consequence of such consideration, investigation, and/or notification. 53 Both applications must therefore be dismissed. 54 I also intend to grant Order 3 in the notice of motion in the Shearman matter. That order concerns the original of the female detainee's letter, a copy of which is annexed to Ms Shearman's affidavit, and moves the Commission that the letter and the copy of the letter attached to Ms Shearman's affidavit by provided to the author by the applicant. The original letter and the envelope are contained on the Court file and may be uplifted by the applicant for the purpose of providing the items to the author of the letter. Orders

(1) The Notice of Motion in Matter No IRC 4342 of 2005 is dismissed.

(2) Order 3 in the Notice of Motion in Matter No IRC 1588 of 2005 is granted and the remainder of the Notice of Motion in Matter No IRC 1588 of 2005 is dismissed. _____________________

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