Elliott v Seymour

Have the Forex Transactions been sufficiently described? 19 A strong attack has been made by Counsel for the NCA on the sufficiency of the allegations in paras 26 to 28 of the substituted statement of claim which are reproduced at para 3 of these reasons. In the earlier reasons for judgment of 19 July 1999, I referred to the claim that five different versions of the Forex Transactions were "in the public domain" and said, at para 71: "Moreover, it is likely that, as a matter of appropriate case management, Elliott will be required, shortly after the close of pleadings, to file affidavits or witness statements embodying the evidence-in-chief which he proposes to adduce at trial. That will necessitate his adoption of one explanation or another of the Forex Transactions. It is to be noted in this context that para 27 of the statement of claim in its present form is embarrassing because it requires the respondents to plead to the "purported purpose" of the payments of $39.5M and $27M. If Elliott now accepts that those payments were not genuinely in settlement of foreign exchange transactions, he should say so in the statement of claim and, if relevant, he can indicate how and when he came to learn of the real purpose for which those payments were made." 20 It seems that para 28 has been included in the substituted statement of claim in response to my intimation that "if Elliott now accepts that those payments were not genuinely in settlement of foreign exchange transactions, he should say so ......". However, the Forex Transactions assume a particular significance in relation to allegations in later paragraphs of the substituted statement of claim. Thus, paras 48 to 52 under the heading "Scope of the Notices" assert that the Bowen, Crabb, Duffy and other Notices did not and were not intended to include the Forex Transactions and were not effective to initiate a valid investigation by the NCA into the Forex Transactions. Those aspects of the Notices had the consequence, it is alleged in paras 61 and 62, that the NCA, in breach of a duty of care owed to the applicant, allowed the Second Sandon, the Duffy and the Sumner Notices to be issued as a result of which the applicant suffered loss and damage. 21 Paragraphs 80 and 81 of the substituted statement of claim identify the investigation of the Forex Transactions as one of the ulterior purposes for which summonses to the applicant were issued and NCA hearings were conducted. Paragraph 85 imputes to "Leckie and/or the NCA" an intention to interrogate the applicant in relation to the Forex Transactions and knowledge that those transactions were not genuine. Those assertions, amongst others, are then said in paras 86 and 87 to give rise to a cause of action in negligence against either or both Leckie and the NCA. Finally in this context, the investigation of the Forex Transactions is identified as one of the unlawful means on which have been erected the conspiracies alleged in paras 109, 112 and 113. 22 Because the Forex Transactions are central to several of the causes of action on which the substituted statement of claim has been founded, I consider that they have been pleaded too elliptically in paras 26, 27 and 28. The Statement of Claim should plead, not merely the making of the payments and how they were recorded and described in the books of EXL, but the true nature of the transactions pursuant to which they were made. It is insufficient, in my view, to assert, as is done in the particulars to the present para 28 of the substituted statement of claim, that "the payments were made to discharge an obligation of EXL owed to ETL." I have set out in para 67 of the reasons for judgment of 19 July 1999 the five accounts of the Forex Transactions which are said to have been "in the public domain." It should therefore impose no real burden on the applicant to require him to give as full particulars as he can of the circumstances giving rise to the obligation as far as those circumstances are known to him. 23 If the nature of the Forex Transactions and the circumstances surrounding them are fully set out in the manner just indicated, it should be possible for the respondents to plead, without merely joining issue, whether the various Notices and Summonses were apt to authorise investigation into the Forex Transactions and, if so, what features of those transactions are relied on as having that effect. It is true that the respondents could file a defence complying with O 11 rr 13 and 18 of the Rules of this Court responding to paras 26, 27 and 28 of the substituted statement of claim as they presently stand. However, that would oblige the respondents to set out their understanding of the Forex Transactions, possibly in several alternative formulations. I therefore consider that the applicant should first be required to provide a comprehensive description of the Forex Transactions by recasting paras 26, 27 and 28 of the substituted statement of claim.

Allegations of Improper Purpose in Issuing Notices. 24 Counsel for the NCA focused another attack on para 23 of the substituted statement of claim. As Counsel for Elliott has pointed out, that paragraph remains unchanged from earlier versions of the statement of claim. It has been reproduced in para 2 of these reasons. Mrs Crennan QC, for the NCA, submitted that the purpose of Messrs Bowen, Crabb and Sumner, who, apart from Crabb, are not parties to the application, could not be relevant to any cause of action pleaded against the actual respondents and para 23 should be struck out as tending to embarrass or scandalise those non-parties. However, as I understand the references to the Notices in the substituted statement of claim, they are all seen as contributing to establish the proposition that there was no valid Notice which authorised the NCA's investigation of the Forex Transactions. The earlier Notices were superseded or "replaced" by the second Sandon, the Duffy and the second Sumner Notices. If that understanding is correct, the references in para 23 to the allegedly invalid purposes for which the earlier Notices were issued are apparently by way of anticipating a defence that a "good root of title" as it were, can be traced from those later Notices to the Bowen, Crabb and First Sumner Notices. Although, on that assumption, para 23 could have been left to be pleaded in a reply, I am not at present persuaded to strike it out. 25 A related criticism has been directed at the pleading in both paras 23 and 24 of the substituted statement of claim that one of the purposes actuating the issue or the procurement of the Notices to which those paragraphs are respectively related was: "(a) discrediting the Applicant." 26 As Mrs Crennan pointed out, there is an inherent ambiguity in the use of "discrediting"to identify an ulterior or unauthorised purpose. Action may be taken by a criminal investigation agency which is entirely within its powers and for the purpose for which those powers have been conferred, such as the successful prosecution of criminal charges against an individual, and it will be a necessary incident of that action to "discredit"the individual. However, as I understand the sense in which "discrediting" is used in para 23, it is intended to convey that the relevant Notices were issued without caring whether Elliott was an appropriate "target"for a criminal investigation, but simply to attract to him whatever opprobrium or "discredit" might attach as a result of the investigation's becoming known in the business and political circles in which he moved. 27 The use of the expression"discrediting"in para 44 may reflect its adoption by Mr Livermore of the NCA in a minute referred to in sub-para (iv) of the particulars sub-joined to that paragraph. That minute referred to SMETL's allegation that the Forex Transactions were not genuine and said "that if it could be substantiated it will possibly disclose offences in Australia in its own right and it would certainly discredit the players involved ......". On its face, that would seem to be an expression of opinion by Mr Livermore that, if Elliott or other "players" were implicated in a sham transaction in New Zealand, that could be used to detract from their credit if they were to give evidence as defendants to criminal proceedings in Australia. It would not necessarily afford a basis for imputing to the NCA the same ulterior purpose which I consider to have been attributed by para 23 to the instigators of the Notices identified in that paragraph. 28 If my understanding of paras 23 and 44 of the substituted statement of claim is correct, each of those paragraphs should be amended to remove the ambiguity to which it seems to be subject.

Lack or Insufficiency of Consultation with IGC 29 Paragraph 42 of the substituted statement of claim alleges: "Insofar as there was consultation with the IGC about the reference of a matter by the Duffy Notice or approval by the IGC of the reference of a matter pursuant to the Second Sandon and Second Sumner Notices, such consultation was not had or approval not given in relation to a proposed reference to be made by any of those notices." 30 I agree with Mrs Crennan that, in its present "rolled up" form, this paragraph is embarrassing and the respondent should not be required to plead to it. It is not clear whether it is alleged that there was no consultation with the IGC about the reference effected by the Duffy Notice, or that such consultation as there was did not embrace, and did not result in the approval of, the reference ultimately effected by the Duffy Notice. It seems to be accepted that there was some consultation with the IGC in relation to the Second Sandon and Second Sumner Notices but that consultation did not result in approval of the reference actually effected by those two Notices. The paragraph should be disentangled and particulars provided of each consultation with the IGC which is said to have occurred and the respects in which it failed to result in approval of the reference purportedly made by the relevant notice or was otherwise deficient.

The Allegations of Negligence against the NCA in relation to the issue of the Notices. 31 In the reasons for judgment published on 19 July 1999 it was noted at para 119: "At no place that I can discover in the present statement of claim is it alleged that any of the duties said to have been owed by the NCA to Elliott was a duty of care." 32 Various allegations of breaches of unspecified duties said to have been owed to the applicant were then examined and it was concluded at para 125: "It should be clear from the necessarily brief discussion of the authorities which I have undertaken in this part of these reasons that Elliott's ability to establish a cause of action in negligence against the NCA will depend on proof of a complex set of circumstances going beyond persuading the Court to adopt the construction of certain sections of the NCA Act for which he contends. I am not persuaded by the facts so far revealed that his prospects of making the NCA liable in negligence are so hopeless that all attempts to plead that cause of action should be struck out of the statement of claim. However, the parts of the pleading where those attempts are made must be clearly identified and drawn together. As well, all the circumstances (not merely identified statutory provisions) relied on as establishing the requisite degree of proximity, including those said to make it foreseeable that Elliott would suffer economic loss in consequence of the NCA's allegedly negligent acts or omissions, must be fully pleaded or particularised." 33 In submissions in support of the substituted statement of claim, Counsel for the applicant claimed that he had "grasped the nettle with the duty allegation and articulated the duty as a duty of care." The matters said to give rise to the first duty of care owed by the NCA are set out as follows in para 58 of the substituted statement of claim: "When making the statements and representations referred to in paragraph 39 above (the statements and representations), the NCA: (a) knew or ought reasonably to have know that Sandon, Duffy and Sumner would rely upon the statements and representations to issue the Second Sandon, the Duffy and the Second Sumner Notices respectively; (b) had already identified the Applicant as a target of the NCA; (c) did so to enable the NCA to conduct the special investigation into or concerning the business affairs of the Applicant; (d) knew or ought reasonably to have known that: (i) the special investigation would be into, among other things, the Forex Transactions; (ii) a summons or summonses would or might be issued to the Applicant by reason of which the Applicant would incur legal costs and expenses; (iii) the special investigation might lead to the Applicant being charged with a criminal offence; (iv) the special investigation would or might discredit the Applicant in his reputation, employment, his public office and business and thereby cause him loss and damage; (e) knew that the Applicant would have no knowledge of the circumstances in which Notices were procured." 34 The statements and representations alleged in para 39 are said to have been made by the NCA to Duffy and the IGC culminating in the statement that: "... Sandon, Duffy and Sumner were authorised to issue new notices without first consulting with or obtaining the approval of the IGC as was otherwise required by law." 35 Particulars appended to para 39 indicate that the statements and representations are to be inferred from three letters and an agenda for minutes of a meeting of the IGC on 31 August 1990. 36 The duty of care said to have arisen in the manner indicated in para 58 is alleged in para 59 to have required the NCA; "(a) to take reasonable care to ensure that statements and representations made or information provided by the NCA for the purpose of procuring a special investigation were accurate, true and were not misleading. (b) to inform Duffy and the IGC, including Sandon and Sumner, of all matters material to the performance of their functions under sections 9, 10, 13 and 14 of the Act." 37 As a result of breaches of that duty which is said to have occurred in making the statements and representations, it is alleged in paragraph 62, the applicant has suffered loss and damage particularised as follows: "(1) Had Duffy, Sumner and Sandon been informed of the facts and matters set out in sub-paragraphs 60(a), (b) and (c) above and the particulars under sub-paragraph 61(a) above, Sandon, Duffy and Sumner would probably not have issued the Second Sandon, the Duffy and the Second Sumner Notices. (2) As a consequence: (a) the NCA could not lawfully have conducted the special investigation into or concerning the business affairs of the Applicant including the issue of the Summonses, the holding or conducting of hearings or the use of any evidence thereby obtained. (b) the Applicant would not have been threatened by the NCA with criminal charges and subsequently charged and prosecuted. (c) The threat of criminal charges and subsequent charging and prosecution of the Applicant caused him the following loss and damage: (i) legal costs and expenses incurred in defending the charges $2,324,162.86. (ii) the loss of the opportunity to profit from the Russian Textile joint venture project which opportunity is to be valued to the Applicant's account by reference to the following components: a) value of equity in joint venture $16.5 million; b) once only fee of $4.95 million; c) present value of 10% profit share in projected joint venture profit; d) interest by way of damage. (d) Prior to 21 September 1993 the Applicant was negotiating with the Australian Government and the owners of textile mills in Russia for the establishment of a privately owned corporation, in which the Applicant would have an equity, to own and operate the mills and associated businesses and to supply them with Australian wool and obtain the necessary financial accommodation. The proposal is substantially described in a draft business plan dated 23 September 1993. Australian Government financial support for the project was an essential element. On about 23 September 1993 the Australian Government became aware, through the Minister for Trade, that the NCA was proposing to charge the Applicant with two counts of theft and one count of taking money from one company and giving it to another. As a consequence of the threatened charges, at some time on or after 23 September 1993 the Australian Government withdrew its support for the project and the project wholly failed. Further, the Applicant was unable to conclude the negotiation and obtain his equity in the corporation and thereby lost the value of that opportunity." 38 I do not consider that any of the matters pleaded in para 59, if established, would make out the relationship of proximity between the Applicant and the NCA required as a matter of law to impose a duty of care on the NCA. In Grimwade v State of Victoria (1997) 90 A Crim R 526, Harper J carefully traced the development by the High Court of the concept of proximity as a constituent of a duty of care. That review went from Jaensch v Coffey (1984) 155 CLR 549 through San Sebastian Pty Ltd v Minister Administering Environmental Planning & Assessment Act 1979 (NSW) (1986) 162 CLR 340, Sutherland Shire Council v Heyman (1985) 157 CLR 424 to Bryan v Maloney (1995) 182 CLR 609. After noting some English authorities revealing difficulties or limitations in the application of the concept, his Honour observed at 549: "One may acknowledge these conundrums while at the same time firmly rejecting the conclusion that Sir Andrew Grimwade's prosecutors are liable to him in negligence. In my opinion, the courts have pointed the way either by reference to point (c) of Deane J's analysis of the first component of an action in negligence, or by including policy considerations among the relevant factors when determining whether the requirement of proximity is satisfied in a particular category of case. In this context, it is instructive to return to the components which, in Jaensch v Coffey at 586 Deane J identified as constituting an action in negligence in a case involving physical injury in the form of personal illness. It will be remembered that the first of these components was "a relevant duty owed by the defendant to the plaintiff to take reasonable care resulting from the combination of (a) reasonable foreseeability of a real risk that injury of the kind sustained by the plaintiff would be sustained either by the plaintiff, as an identified individual, or by a member of a class which included the plaintiff, (b) existence of the requisite element of proximity in the relationship between the parties with respect to the relevant act or omission and the injury sustained, and (c) absence of any statutory provision or other common law rule ... which operates to preclude the imputation of such duty of care to the plaintiff in the circumstances of the case". If, in a case such as the present - which is not a case involving physical injury - one were to add to point (c) an absence of any reason in policy which might operate to preclude the imputation of a duty of care to the plaintiff, then one would, it seems to me, have an adequate description of the first of the components of an action in negligence applicable to the present case." 39 After a review of several English authorities which concluded with Elguzouli-Daf v Commissioner of Police of Metropolis [1995] QB 335, Harper J observed at 559: "His Lordship's reasoning is apposite in the present case. In making the initial decision to prosecute; in deciding whether or not to accept an application for a nolle prosequi; in deciding whether or not to directly present the plaintiff following his discharge by a magistrate at the conclusion of the relevant committal proceedings; and in prosecuting at committal and at trial - in each of these instances, the plaintiff's prosecutors were under a duty to be fair. In relation to the last of the instances, the question of the continued usefulness of the torts of malicious prosecution and misfeasance in public office would be very pertinent were a cause of action in negligence to exist as against the prosecutors or the State. In relation to all of these instances I agree, with respect, that liability in negligence would be even more inapposite than in the case of the opposing party or his or her solicitor in civil litigation. It follows that the State is not liable to Sir Andrew Grimwade in negligence. Either the relationship between Sir Andrew and his prosecutors was not one of proximity because policy considerations so decreed; or the relationship was one of proximity, but policy considerations intervened at the next level of analysis to preclude the creation of a duty of care. In either case, policy dictates that a prosecutor not be bound by any duty to an accused other than a duty to be fair. To be more than fair to the accused is to be less than dutiful to the Crown." 40 Elguzouli-Daf and Grimwade have been applied by Higgins J in Emanuele v Hedley (1997) 137 FLR 339 in rejecting a claim that Australian Federal Police officers and prosecutors were under a duty of care to the plaintiff to refrain from prosecuting the plaintiff or to terminate the prosecution after it had been commenced. See also Hillman v Black (1996) 67 SASR 490. 41 Counsel for Elliott sought to equate the duty allegedly owed by the NCA with that found by the High Court to exist in L Shaddock & Co Pty Ltd v Parramatta City Council [No 1] (1981) 150 CLR 225 which is discussed in para 116 of the reasons for judgment of 19 July 1999. In that case, as Brennan J explained in Sutherland Shire Council v Heyman, the fact that the respondent Council was performing public functions was one of the circumstances which warranted a conclusion that it realised, or should have realised, that a person seeking information would act on that information so that a duty of care arose in the giving of the information. Mr Judd also referred to the recent judgment of the High Court in Perre v Apand Pty Ltd (1999) 164 ALR 606. In that case it was held that the respondent suppliers of seed potatoes to particular growers in an area of South Australia owed a duty of care to growers in the same area who foreseeably would be exposed to loss in the event of a prohibition on the sale in Western Australia of potatoes from that area after an outbreak of bacterial wilt in crops sown with defective seed supplied by the respondent. It will be remembered that the statements and representations pleaded in para 60 of the substituted statement of claim to have been made in breach of the duty of care owed to Elliott were made to Duffy and the IGC. Unlike the statements which gave rise to the action in Shaddock v Parramatta City Council, they are not said to have been acted on by Elliott himself. Rather, it is put that a duty was owed to Elliott not to mislead Duffy or the IGC into taking action with foreseeable adverse consequences for Elliott. That distinction, I assume, explains the applicant's recourse to Perre v Apand Pty Ltd where a duty of care was held to arise because damage to the plaintiff was a foreseeable consequence of the respondent's breach of the primary duty owed to the purchasers of the defective seed. 42 More significantly, no occasion arose in Shaddock or Perre v Apand Pty Ltd for the application of the concept of proximity as affected by considerations of public policy like those identified in, for example, Grimwade and Emanuele v Hedley. Although inclined to differentiate, for purposes of the law of negligence, between the inquiry mandated by the concept of proximity and that into the application of policy considerations, Kirby J in Perre v Apand Pty Ltd said, at 689 (footnotes omitted): "Nor is this a case where to hold Apand to a legal duty of care would be to interfere unreasonably with its economic freedom, its autonomy and the competitive operation of the marketplace. As a matter of policy, the law will generally uphold the right of a party lawfully to gain profit although doing so will occasion economic loss to others. That is often the very way in which the market operates in our form of economy. Apand certainly had an economic interest in disposing of the non-certified seed when its original Saturna experiment was called off. But Apand was not entitled to pursue that interest in a way that constituted a breach of the law. Apart from any other reasons which may apply in this case, as Hayne J has pointed out, the fruit and plant quarantine laws of South Australia absolutely prohibited the importation or introduction into the State of South Australia of any plant (defined broadly enough to include seed) affected by bacterial wilt. Yet upon the premises established by the factual findings not now in dispute, this is precisely what Apand did. It is not necessary to consider whether, absent such statutory prohibitions, illegality otherwise affecting what Apand did in relation to the Perre Interests would have been sufficient in any case to put a limit on Apand's economic freedom so far as it impinged on the legitimate interests, economic and otherwise, of the Perre interests. No reason of policy arising from the ordinary deference which the law pays to that economic freedom and market competitiveness prevents a finding that a legal duty of care existed in this case. 43 I have not been able to discern in the substituted statement of claim any assertion that the NCA knew, or ought to have known, that Elliott would rely on it to provide accurate information and advice to the IGC or individual Ministers when requesting the issue of notices. Doubtless, Elliott, like any other citizen, had an expectation that the NCA would exercise its statutory powers responsibly and in good faith. But that does not entail the conclusion that the NCA was subject, in the provision of information and advice to the IGC to a duty of care owed specifically to Elliott. If a duty of care of that kind were imposed on the NCA in the circumstances of the present case, it would seem to follow that a corresponding duty of care would be owed to Elliott by the members of the IGC and each Minister who issued a Notice. 44 For these reasons I have concluded that, although the duty of care alleged in para 59 of the substituted statement of claim is said to have arisen before any decision was taken to prosecute the applicant, general policy considerations applicable to the investigation and prosecution of criminal activity viewed as a continuous process operate to preclude the ascription to the NCA of such a duty of care.

Allegations of Negligence against Leckie or the NCA concerning the issue of Summonses. 45 Paragraph 85 of the substituted statement of claim imputes to Leckie or the NCA various intentions and states of actual or constructive knowledge before the issue of the summonses requiring Elliott to attend for examination before the NCA. Those matters are then alleged in para 86 to give rise to a "duty of care to the Applicant when issuing the Summonses: (a) to ensure that the Summonses contained sufficient information to enable the Applicant; (i) to know the general nature of the matters in relation to which the NCA intended to interrogate him; (ii) to know the authorised scope of the special investigation; (iii) to know the fact that the NCA had already identified him as a target; (iv) to know the intended us to be made of his evidence including its provision to the NZSC, NZSFO and SMETL; (v) to exercise his rights under section 30 of the Act. (b) to ensure that each of the Summonses was accompanied by a copy of the Bowen, the Crabb, the First Sumner and the First Sandon Notices." 46 A breach of those alleged duties of care is then asserted in para 87 as set out in para 9 of these reasons. A causal link between those alleged breaches of a duty of care is sought to be established by the Particulars to para 88 which have been reproduced at para 10 of these reasons. 47 Several detailed criticisms have been made by Counsel for the NCA suggesting that the applicant could not make out various of the factual allegations made in these paragraphs. Although many of those criticisms apparently have considerable force, it is unnecessary for me to examine each of them in detail because I consider that the applicant is precluded a fortiori from erecting a cause of action in negligence in relation to the issue of the Summonses by the obstacles identified in paras 38 to 42 above in the way of establishing the requisite relationship of proximity between either or both Leckie and the NCA and Elliott as the recipient of the Summonses. Those obstacles arise from public policy considerations which I say apply a fortiori to this second attempt to make out a cause of action in negligence because the issue of the Summonses was more centrally part of the investigation of criminal offences and the public interest in the fearless discharge of that function has received statutory recognition in s 36(1) of the Act which provides: "A member has, in the performance of his functions or the exercise of his powers as a member in relation to a hearing before the Authority, the same protection and immunity as a Justice of the High Court." One of the functions or powers of a member of the NCA is that conferred by s 28 of the Act to "summon a person to appear before the Authority at a hearing to give evidence and to produce such documents or other things (if any) as are referred to in the summons."

Allegations of negligence of Leckie and the NCA in conducting hearings. 48 This part of the substituted statement of claim commences with para 90 which corresponds with para 85 discussed in para 45 above. The existence of duty of care is pleaded in para 91 in these terms: "As a consequence of the matters alleged in paragraph 90 above, Leckie and/or the NCA owed a duty of care to the Applicant when conducting the First Hearing to ensure that the Applicant was provided sufficient information to enable him: (a) to know the general nature of the matters in relation to which the NCA intended to interrogate him; (b) to know the authorised scope of the special investigation; (c) to know the fact that the NCA had already identified him as a target; (d) to know the intended use to be made of his evidence including its provision to the NZSC, NZSFO and SMETL; (e) to exercise his rights under section 30 of the Act." 49 Paragraph 92 alleges a breach of that duty of care as appears from the text of that paragraph set out at para 11 of these reasons. There is much force in the contention advanced by Counsel for the NCA that this part of the pleading should have identified the "rights" under s 30 of the Act which Elliott would have exercised but for the alleged breaches of a duty of care. As has been demonstrated in Ganin v New South Wales Crime Commission (1993) 32 NSWLR 423 at 435-436, the range of "lawful excuses" available under a provision like s 30 is extensive. However, this third attempt to make out a cause of action in negligence is focused on another part of the NCA's investigative functions closely related to the issue of summonses and is confronted by the same insuperable obstacles identified in paras 44 and 47 above.

Alleged negligence of Leckie, Livermore and NCA in disclosing Secret Information. 50 This fourth further or alternatives plea of a cause of action in negligence is commenced by para 95 of substituted statement of claim which alleges: "Between December 1989 and July 1991 Leckie, Livermore and the NCA exercised Coercive Powers to obtain documents, transcripts of evidence and other information of and concerning the business affairs of the Applicant (the Information)." 51 A state of actual or constructive knowledge is then imputed by para 96 to Leckie, Livermore and the NCA as a result of their having obtained "the Information". That paragraph alleges that they "knew or ought reasonably to have known: (a) that such of the Information as was obtained from the Applicant was confidential to him; (b) that disclosure of any of the Information to any other person would or might discredit the Applicant in his reputation, employment, public office and business and thereby cause him loss and damage; (c) that any disclosure of the information should: (i) be authorised by the Act or otherwise; (ii) be made only for the purposes of the Act; (iii) be made only in connection with the performance of a duty under the Act." 52 In consequence of the matters alleged in paras 95 and 96, it is claimed in para 97, Leckie, Livermore and the NCA owed various duties of care to the applicant which are described in the terms set out in para 12 above. Breaches of one or more of those duties are particularised in para 98 as reproduced in para 13 of these reasons. 53 This part of the substituted statement of claim has attracted several valid criticisms as a matter of pleading. For example, by defining it as widely as "the business affairs of the Applicant" the pleader has allowed "the Information" to comprehend matters which by no stretch of the imagination could be regarded as confidential. Counsel for the NCA drew an apt parallel between the difficulties created by the width of that definition and those noted by Mason J in O'Brien v Komesaroff (1982) 150 CLR 310 at 326, where his Honour said: "..... the respondent has consistently failed to identify the particular contents of the documents which he asserts constitute information the confidentiality of which he is entitled to protect. The consequence is that he has failed to formulate a basis on which the court could grant him relief on the assumption that some part or parts of the documents constitute confidential information." 54 There are also difficulties in linking the allegedly negligent disclosure of "the Information" to the damage alleged in para 99 to have been suffered by the applicant which is said to be particularised in the same terms as sub-para 2(c) of the particulars under para 62. However, it is unnecessary for me to express a concluded view about whether these difficulties are curable by a further amendment to the substituted statement of claim because I am persuaded that the objections identified in paras 44, 47 and 49 above which are common to the other formulations of negligence against Leckie or the NCA are also fatal to the attempt to plead a cause of action arising from disclosure of "the Information" in breach of a common law duty of care. It is to be remembered in this context that the applicant has abandoned or disavowed any attempt to allege breach of statutory duty or misfeasance in a public office.

Allegations of Conspiracy between Seymour, Sherman, the NCA and the DPP. 55 The first allegation of conspiracy against the NCA is that contained in para 109 of the substituted statement of claim that it, together with Seymour, Sherman and the DPP conspired to injure the applicant by unlawful means. Four "unlawful means" are then identified in sub-paras (a), (b), (c) and (d) reproduced in para 17 of these reasons. In the reasons for judgment of 19 July 1999, in commenting on an earlier attempt to charge a conspiracy against the same parties, I observed at para 89: "I assume that the conspiracy between the NCA, Seymour, Sherman and the DPP is also of that "unlawful means" kind. If that is so, it remains necessary to plead the agreement or combination and to establish that the occasion had arisen for resorting to or threatening to resort to unlawful means. Otherwise, there would be, as Dixon J pointed out in McKernan v Fraser (1931) 46 CLR 343 at 361: "… at most … a combination for a purpose to be effected by a lawful means or, if necessary, by unlawful means. The occasion did not arise for resorting to or threatening to resort to unlawful means, and no circumstance occurred in which such means could have been employed against the respondents."" 56 I entertain grave doubts whether the particulars appended to para 109 of the substituted statement of claim, if established, would give rise to the inference there asserted that there was an agreement of the requisite kind between Seymour, Sherman, the NCA and the DPP. Having regard to the extensive access to the NCA's records which the applicant has had by virtue of other related litigation, including the criminal trial, I do not consider that those particulars should be regarded as sufficient"until discovery" as is claimed in the particulars appended to para 109(a) of the substituted statement of claim. 57 As I understand it, the substance of the conspiracy sought to be alleged against Seymour, Sherman, the NCA and the DPP is that, knowing that the NCA could not lawfully investigate Elliott's business affairs, the parties agreed that such an investigation should be conducted by the DPP and that a prosecution arising out of it should be instituted nominally by Seymour who was appointed a member of the Victoria Police Force for that purpose and who was assisted by the DPP in framing and prosecuting the charges against Elliott. However, the substantive allegations in sub-paras (a), (b), (c) and (d) of para 109 do not sufficiently indicate what is said to make unlawful the "means" there pleaded. In addition the "overt acts" pleaded in para 110 of the substituted statement of claim to have been committed in execution of the conspiracy do not mirror the "unlawful means" alleged in para 109. Finally, it is not made clear on the face of the pleading how any of those overt acts caused the damage to the applicant which is identified in sub-para 2(c) of the particulars set out at para 37 of these reasons.

Allegation that the NCA conspired with NZSC, NZSFO and SMETL. 58 This allegation is contained in paras 112 to 114 of the substituted statement of claim. The conspiracy is said to have been constituted by four separate agreements made between 9 May 1990 and 27 August 1990. The NCA and one or more of the New Zealand agencies is alleged to have been a party to each of those agreements. Again, the applicant has set out to plead an "unlawful means" conspiracy but the unlawful means agreed to have been adopted have not been related to each of the alleged agreements. Rather, it is said in sub-para (f) of the particulars appended to para 112: "The means by which the Applicant was to be caused injury were unlawful because the NCA agreed to use its powers for purposes other than the purposes for which they were conferred. The unlawful purposes were to: (i) investigate the Forex Transactions; (ii) discredit the Applicant; (iii) obtain evidence for use of the NZSC; (iv) obtain evidence for use of the NZSFO; (v) obtain evidence for use by the SMETL." The facts and circumstances upon which the Applicant relies are as alleged in paragraph 113 below. Further particulars will be provided after discovery." 59 That form of pleading raises the interesting question of whether a conspiracy can be constituted by an agreement between two or more conspirators under which only one corporate conspirator is to engage in conduct which is ultra vires that conspirator. However, the fundamental objection as a matter of pleading is that the "unlawful means" agreed upon has not been identified, and no facts or circumstances have been pleaded which are said to make those means unlawful. In this sense, para 112 suffers from the same vice identified in para 57 of these reasons. 60 Paragraph 113 of the substituted statement of claim alleges that: "In furtherance of the conspiracy referred to in paragraph 112 above the following acts were performed." 61 Then follow some thirty-two sub-paragraphs of allegations of what I take to be "overt acts" committed in execution of the "unlawful means" conspiracy alleged in para 112. However, like the "overt acts" pleaded in para 110 discussed at para 57 of these reasons, the actions alleged in para 113 do not mirror the "unlawful means" allegedly agreed upon. That probably reflects, in part, the failure of para 112 to set out the "unlawful means" as distinct from the "unlawful purposes" which were said to make ultra vires the NCA's agreement to use its powers. However, the catalogue of what I have assumed to be "overt acts" pleaded in para 113 contains many actions exclusively attributable to one or other of the New Zealand agencies, or in at least one instance, to another entity, the Australian National Companies and Securities Commission, not alleged to have been a party to the conspiracy. Presumably, the justification for pleading overt acts of the kind just described is that they are alleged to have been performed with knowledge that the NCA was seeking to achieve purposes which were beyond its powers or unauthorised, but the pleading does not say so.

The Claims Against Crabb 62 The claims previously formulated against Crabb alleging misfeasance in a public office and four separate conspiracies are discussed at paras 143 to 153 of the reasons for judgment of 19 July 1999. The attempt to make out a cause of action in conspiracy against that respondent has now been abandoned.

63 This allegation has been retained in the substituted statement of claim by pleading in para 101: "At all relevant times Crabb, as a member of the IGC, was required by law not to disclose to any person other than a member of the IGC or a person bound by section 51 of the Act the fact that the NCA was investigating the affairs of the Applicant or any information received by him in that capacity. PARTICULARS The duty arises from the following facts and matters: (a) the provisions of the Act and the Victorian Act; (b) the fact that Crabb was a Minister of the Crown for the State of Victoria." 64 It is then pleaded in para 102 that Crabb, in his capacity as a member of the IGC, received the Crabb Information "which he knew or ought reasonably to have known would, if disclosed to the public, discredit the Applicant in his reputation, employment, public office and business and thereby cause him loss and damage." 65 It is further alleged in the same paragraph that Crabb disclosed the Crabb Information to the ABC in circumstances where he knew, or ought to have known, that the ABC would disclose it to the public. There appears to be some force in the submission made on behalf of Crabb that the particulars sub-joined to para 102 are erroneous insofar as they assert that the provision of the information to the ABC by Crabb has been admitted in Crabb's affidavit sworn 15 May 1991 "in the Applicant's defamation proceeding against the ABC in the Supreme Court of Victoria." However, I do not consider that particulars of the alleged disclosure to the ABC are necessary to enable Crabb to know the case he has to meet in this respect, at least for the purpose of pleading in his defence to para 102(b) of the substituted statement of claim. 66 The fact of publication by the ABC on 20 February 1990 is alleged in para 103 of the substituted statement of claim and para 104 contains the allegations about Crabb's purpose or state of knowledge reproduced in para 15 of these reasons. In paras 143 and 144 of the reasons for judgment of 19 July 1999 it was observed: "In para 108 of the statement of claim it is alleged that Crabb owed a duty to Elliott not to disclose information about an investigation which he, Crabb, received in his capacity as a member of the IGC. As pointed out in para 121 above, a "duty of secrecy" as it has been called may import a duty of care to the person who is entitled to have the secret preserved, but I do not understand any breach of a duty of care to be alleged against Crabb. Rather, it is alleged that he intentionally disclosed information which he had received as a member of the IGC to the ABC for the purpose of discrediting Elliott and achieving an electoral advantage for the Australian Labor Party and an electoral disadvantage for the Liberal Party. Those allegations, in my view, would satisfy the requirements for pleading misfeasance in a public office if they were accompanied by an assertion, with appropriate particulars, that Crabb's actions inflicted actual economic loss on Elliott." 67 I consider that paras 101 to 104 of the substituted statement of claim sufficiently plead the actions and state of mind necessary to constitute the tort of misfeasance in the public office discussed in paras 101 to 102 of the reasons for judgment of 19 July 1999. I also regard para 105 of the substituted statement of claim as sufficiently alleging and particularising the loss said to have been suffered by Elliott as a result of the disclosure to the ABC of the Crabb Information. Whether all or any of the damage there particularised was in fact caused by the publication by the ABC will doubtless be strongly contested. As well, Mr Southall QC for Crabb has foreshadowed a contention on behalf of that respondent that, as a member of the IGC, he was not under a duty to keep secret information such as the Crabb Information. In the same context, Mr Southall criticised the particulars to para 101 of the substituted statement of claim as unduly laconic. However, I do not consider that Elliott should be required at this stage to re-plead this part of his case. After delivery of a defence, it may be appropriate to set down for determination as a separate or preliminary question pursuant to O 29 r 2 of the Rules of this Court, the issue of whether Crabb was required, in the exercise of his office as a member of the IGC, not to disclose information like the Crabb Information acquired by him in that capacity.

(ii) Breach of Duty of Care. 68 Allegations framed to make out against Crabb a cause of action in negligence have now been pleaded in paras 106 to 108 of the substituted statement of claim. However, for the reasons explained in paras 38 to 42 above, I consider that the conflict between Crabb's public duty as a member of the IGC and the duty alleged in paras 106 and 107 of the substituted statement of claim, precludes, for reasons of public policy, the establishment of the relationship of proximity necessary to found a cause of action in negligence. Moreover, as Harper J pointed out in the passage from Grimwade set out at para 39 above, the continued usefulness of the tort of misfeasance in a public office, which the present applicant has invoked against Crabb, would be called into question if a cause of action against him in negligence were to co-exist on the same facts. To similar effect, Higgins J observed in Emanuele v Hedley (supra) at 359: "There is no tortious liability towards an accused person for negligently investigating or prosecuting that person. If there was such a cause of action, a prosecutor would be liable for damages notwithstanding that there was no malice and no lack of reasonable and probable cause for the investigation and prosecution in question. That would make malicious prosecution and misfeasance in public office and, indeed, intentional infliction of harm by an unlawful act, otiose. It would also by-pass the torts of defamation and injurious falsehood." 69 No additional facts have been pleaded to support a further or alternative claim in negligence against Crabb. As Mr Judd frankly acknowledged, "the old paragraph 112(a) has re-emerged as a negligence claim ..... Paragraph 112(b) of the old pleading has continued as misfeasance ...... The factual matrix underlying the causes of action has not changed. The real substance of the changes of the case against Mr Crabb are changes to the bold headings. The substance of the allegations has not materially changed." 70 For these reasons paras 106 to 108 of the substituted statement of claim cannot be allowed to stand.

Conclusion 71 Counsel for each of the parties who remain respondents to this application have been united in the force with which they have drawn attention to the numerous attempts by the applicant over the convoluted history of this litigation to refine successive versions of the statement of claim to a point where each of the causes of action which he seeks to maintain is unexceptionably disclosed. Those submissions have been directed to my adopting the course adverted to by Gleeson CJ in Trau v University of Sydney (1989) 34 IR 466 from which I quoted another passage at para 154 of the reasons for judgment of 19 July 1999. In a later passage, at 477, his Honour said: "It is tempting to make an order which will bring a complete end to this litigation. The appellant's various claims against the university resemble the Hydra, and an undertaking of the Second Labour of Hercules might well be a worthwhile exercise in the interests of all concerned." 72 A similar course is no less tempting in the present case but, after much anxious consideration, I have decided on balance that the applicant should be allowed one further opportunity to express in proper form the reduced number of causes of action conceivably open to him. I have been influenced to reach that conclusion primarily by the reflection that the tortuous process to which Counsel for the respondents have referred has resulted in a considerable refinement of the applicant's pleadings. In the light of earlier rulings or intimations, attempts to invoke an action on the case in accordance with Beaudesert Shire Council v Smith (1966) 120 CLR 145, the tort of intimidation, breach of statutory duty, abuse of process and conspiracy against Crabb have been abandoned or disclaimed. As indicated in paras 44, 47, 49, 54 and 70 above, each of the attempts to erect a cause of action in negligence against any of the NCA, Leckie and Crabb have failed. 73 Accordingly, I have concluded, not without diffidence, that the applicant should have one more opportunity to re-plead the remaining two claims of conspiracy and the claim of misfeasance in a public office against Crabb. If that opportunity is taken, it should be possible for Counsel, unembarrassed by the need to retain much of the narrative relied on to support those causes of action, including negligence, which are demonstrably unavailable to the applicant, to identify in a coherent and self-contained way the material facts said to give rise to each of the remaining causes of action. I also expect that, when availing themselves of the opportunity which I propose to afford, Counsel for the applicant will also be instructed by the numerous cogent criticisms of a technical nature which have been made of the attempts in the substituted statement of claim and earlier versions of that pleading to disclose those causes of action. These expectations engender the hope that the final pleading will throw into sharper relief the questions of law affecting those causes of action, which have been adumbrated in the course of the examination to date of the statement of claim in its various emanations. That, in turn, ought to permit a more concise consideration of whether the applicant has a case which should go to trial. 74 Accordingly, I shall order that the applicant file and serve by 21 July 2000 a further draft amended statement of claim confined to the causes of action in conspiracy and misfeasance in a public office against Crabb which had been referred to earlier in these reasons. I shall adjourn to a date to be fixed, being not earlier than 7 August 2000 all motions on notice in these proceedings which have not been finally disposed of. The question of costs of all parties of those motions and of the hearings on 27 and 28 September 1999 will be stood over to the date fixed for the adjourned hearing of the extant motions. To the limited extent necessary, I shall make corresponding orders in the related proceedings (VG 434 of 1993) in which Mr Scanlon is the applicant. I certify that the preceding seventy-four (74) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Ryan.

Counsel for the Applicant: Mr J G Judd QC with Mr R Peters

Solicitor for the Applicant: Barker Gosling

Counsel for the First, Second and Third Respondents: Mrs S Crennan QC with Mr J W S Peters

Solicitor for the First, Second and Third Respondents: Australian Government Solicitor

Counsel for the Fourth Respondents Mr R F Redlich QC with Mr T Di Lallo

Solicitors for the Fourth Respondent: Mr Peter Wood, Solicitor for the Office of Public Prosecutions for the State of Victoria

Counsel for the Sixth Respondent: Mr A G Southall QC

Solicitors for the Sixth Respondent: Maurice Blackburn Cashman

Dates of Hearing: 27 and 28 September 1999

Written Submissions 5 October 1999

Date of Judgment: 26 May 2000