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[2025] FCA 67
Federal Court of Australia
2025-02-11
Dowling J
Original judgment source is linked above.
Date of last submission 19 December 2024
Counsel for the Applicant Mr M Follett KC and Mr M Minucci
Solicitor for the Applicant Ashurst Australia
Counsel for the First Respondent Mr R Nathwani KC and Mr Y Bakri
Solicitor for the First Respondent Davies Lawyers
Solicitor for the Fourth Respondent Mr A O'Bryan of Galbally & O'Bryan
Counsel for the Fifth Respondent Mr N Harrington
Solicitor for the Fifth Respondent Peter Vitale and Associates
Counsel for the Sixth and Seventh Respondents Mr C Massy and Mr D Murphy
Solicitor for the Sixth and Seventh Respondents Maurice Blackburn
BETWEEN: GENERAL MANAGER OF THE FAIR WORK COMMISSION Applicant DIANA ASMAR First Respondent AND: KERRY GEORGIEV Second Respondent NICK KATSIS (and others named in the Schedule) Third Respondent
order made by: DOWLING J DATE OF ORDER: 11 February 2025
THE COURT ORDERS THAT:
INTRODUCTION 1 The applicant, the General Manager of the Fair Work Commission, seeks declarations, penalties and compensation for what he alleges is the misappropriation of the funds of the Health Services Union by Ms Diana Asmar, the Secretary of the Victoria No. 1 Branch of the Union, and the other respondents. 2 By her interlocutory application, Ms Asmar seeks that the proceeding be stayed "until Victoria Police advise … [Ms Asmar] that no criminal proceeding will be instituted against her that relies on conduct of … [Ms Asmar] that is substantially the same as that alleged by the … [General Manager]." 3 No criminal proceedings have been commenced against Ms Asmar or any of the respondents to this proceeding. The state of any investigation into Ms Asmar or the other respondents is not known. However, Ms Asmar says criminal proceedings are "on the cards". She says those criminal proceedings would arise from the same facts and matters the subject of this proceeding. She says balancing justice between the parties, including the risk of real prejudice to the respondents in the defence of any criminal proceedings, favours a stay of these proceedings. 4 The General Manager says that the respondents have not established that criminal proceedings are on the cards and the Court cannot be satisfied of any real prejudice. He says that the Court should not lightly interfere with his right to have these proceedings determined. 5 The allegations made by the General Manager are made under Part 2, Chapter 9, of the Fair Work (Registered Organisations) Act 2009, which sets out the duties of financial management of officers and employees of registered organisations. The Act also provides that proceedings, such as those brought by the General Manager, will be stayed if criminal proceedings are started (or have already been started) and those proceedings concern substantially the same conduct as the proceedings under the Act: see s 312 of the Act. 6 There are seven respondents to this proceeding. Ms Asmar is the first respondent. Her application for a stay is supported by the fourth (Mr David Asmar), sixth (Mr Atkinson) and seventh (Ms Barclay) respondents. The second (Ms Georgiev) and third (Mr Katsis) respondents did not participate in the hearing of Ms Asmar's interlocutory application. The fifth respondent, Mr Eden, opposes the making of the stay. 7 For the reasons set out below I refuse the application for a stay. Balancing justice between the parties I am not satisfied that a stay is appropriate at this time.
CHRONOLOGY AND BACKGROUND FACTS 8 The General Manager's allegations of misappropriation of the funds of the Union are constituted by allegations that: (a) Ms Asmar and Ms Georgiev knowingly effected transfers from Branch accounts in purported reimbursement of illegitimate business expenses incurred by Ms Asmar between August 2018 and November 2020; (b) Ms Asmar, Ms Georgiev and Mr Katsis knowingly effected transfers from Branch accounts to Ms Asmar for expenses not properly incurred by Ms Asmar; (c) Ms Asmar and Ms Georgiev transferred funds of $2.8 million from Branch accounts between June 2016 and June 2021 to Southern Publishing for no goods or services; and (d) Ms Asmar, Mr Katsis, Mr Eden, Mr Atkinson and Ms Barclay engaged in a practice of providing the password assigned to them by the Commbiz mobile application to Ms Georgiev and thereby enabling Ms Georgiev to authorise transactions from the Branch's Commonwealth Bank accounts without verification (it seems with respect to the alleged illegitimate expenses and Southern Publishing payments). Ms Asmar and Mr Asmar are alleged to have received deposits into their personal bank accounts at or around the time that payments were made to Southern Publishing. Mr Asmar is alleged to have aided or abetted the contraventions by Ms Asmar or alternatively been knowingly concerned in the contraventions by Ms Asmar. The contravening conduct is alleged to be in contravention of ss 285, 286, 287 of the Act. 9 Ms Asmar relied upon a number of news reports. They were tendered without objection. One of those reports included what purported to be a statement from Victoria Police which said that their investigation into the Branch "commenced in October 2023 after information was provided to police in relation to allegations of false invoices linked to a union and a private company". 10 On 26 March 2024, the Fair Work Commission wrote to the Branch regarding "concerns relating to payments of reimbursements to Ms Diana Asmar by the Branch". 11 On or around 15 May 2024, Victoria Police executed search warrants on the offices of Commerce Press and the home of Mr Peter Walsh, a director of Tintern Heights Pty Ltd (trading as Southern Publishing), and seized folders of documents, including documents related to Southern Publishing, as well as a desktop computer, hard drives and telephones. Commerce Press is described in the General Manager's statement of claim in this proceeding as the Union and/or Branch's "legitimate and long-term supplier of printing, stationery and merchandise". As identified above the statement of claim alleges that the Branch, with the knowledge of Ms Asmar, paid invoices of Southern Publishing in circumstances where it did not provide any goods or services to the Union or Branch. Mr Walsh is named in the statement of claim as a director and shareholder of Southern Publishing. 12 On 7 August 2024, the Age published an article titled "CFMEU, health union probed over alleged millions spent on ghost printing". That article set out allegations of illegitimate reimbursements paid to Ms Asmar and money paid to a printing firm for no services. 13 On or around 3 September 2024, Victoria Police executed search warrants on the offices of the Branch's accountants and seized property. There was no evidence about what property was seized. 14 On 9 September 2024, Ms Asmar's solicitor wrote to Victoria Police stating that she understood that Ms Asmar and others were under investigation and requested the name of the informant of the investigation. On 10 September 2024, Detective Inspector Damien Jones replied that he was the "officer in charge of the Financial Crime Squad" and "within your letter's (sic) to Victoria Police media unit and to Detective Senior Constable Petrovska (9/9/2024) you have stated that it is your understanding that Victoria Police is currently investigating Diana Asmar. Victoria Police is under no obligation to disclose anything in relation to current investigations, however I can confirm that Ms Asmar is NOT currently under investigation" (Original emphasis). 15 On 10 September 2024, Senior Counsel for Ms Asmar, Mr Nathwani KC, had a telephone conversation with Detective Senior Constable Mark Homberg from the Financial Crime Squad. Det Snr Const Homberg was one of the officers who had conducted the search on Commerce Press and Mr Walsh's home. In that conversation Mr Nathwani KC said that he understood Det Snr Const Homberg was investigating the "Health Workers Union". Det Snr Const Homberg said he was "assisting this job" and that he would pass on the contact details of the informant. Det Snr Const Homberg then sent Mr Nathwani KC a text message stating that the "Primary Investigator" of "Operation FCS Quiz-2023" was Det Snr Const Petrovska; and the supervisor was Detective Sergeant Peter Griffiths. Ms Asmar submits that the Police do not assign operation names to matters not under investigation. I also infer from the name that this operation commenced in 2023. 16 On 11 September 2024 Mr Nathwani KC emailed Det Snr Const Petrovska and Det Sgt Griffiths stating that he knew Det Snr Const Petroska and Det Sgt Griffiths were the informant and supervisor in relation to Operation FCS Quiz and that he had seen documentation relating to searches they had conducted. Mr Nathwani KC asked, "can you confirm that Operation FCS Quiz-2023 is an investigation into Peter Walsh, his business entities, Southern Publishing and teh (sic) Health Services Union/Health Workers Union?" On 12 September 2024, Det Insp Jones replied to Mr Nathwani KC and again stated that he was the "officer in charge of the Financial Crime Squad" and that "Victoria Police is under no obligation to disclose anything in relation to current investigations, however I can confirm that Ms Asmar is NOT currently under investigation" (Original emphasis). 17 Mr Nathwani KC replied to Det Insp Jones on the same day saying that Det Insp Jones did not answer his question and again asked, "[c]an you confirm that Operation FCS Quiz-2023 is an investigation into Peter Walsh, and/or his business entities, and/or Southern Publishing and the Health Services Union/Health Workers Union?" Having not received a response, Mr Nathwani KC emailed again on 3 October 2024 requesting a reply. On 21 October 2024, Mr Nathwani KC emailed again stating "[a]re you able to reply to the below, or at least confirm that you refuse to?" On 21 October 2024, Det Insp Jones responded to the further emails of Mr Nathwani KC stating that he would not "be making comment on any matters that may or may not be under investigation". 18 On 17 September 2024, the solicitors for Ms Asmar wrote to the Australian Federal Police (AFP) and asked, "are you able to confirm that you are currently investigating the HWU, Mr Walsh, entities related to Mr Walsh (including Southern Publishing) and/or Ms Asmar". On 20 October 2024, the Australian Federal Police National Operations State Service Centre, Southern Command, responded stating that the AFP did not comment on operational matters, or whether there is a current investigation occurring. 19 On 14 November 2024, Victoria Police released a press statement titled "[m]an arrested as part of investigation into fraudulent invoices" which stated, "detectives from the Financial Crimes Squad have this morning arrested a man as part of their investigation in relation to allegations of false invoicing linked to a union and a private company". There was no dispute before me that this man was Peter Walsh. On the material before the Court no criminal proceedings have been commenced against Mr Walsh. 20 I was not advised of any other relevant steps that have been taken by Victoria Police, or the AFP, since 14 November 2024.
PRINCIPLES 21 The parties were largely (save for one matter identified below) in agreement as to the applicable principles. Those principles can be summarised as follows. 22 First, the Court has a broad jurisdiction to stay proceedings in the interests of justice: see Obeid v Commissioner of Taxation [2017] FCA 1135 at [2] per Pagone J (and the cases cited); Websyte Corporation Pty Ltd v Alexander (No 2) [2012] FCA 562 at [53] per Dodds-Streeton J; Impiombato v BHP Group Limited [2020] FCA 350 at [122] per Moshinsky J. 23 Second, the Court's power to grant a stay is an incident of its general power to control its own proceedings. Consistently, s 23 of the Federal Court of Australia Act 1976 (Cth) empowers the Court, in relation to matters in which it has jurisdiction, to make orders, including interlocutory orders, as the Court thinks appropriate. 24 Third, the Court's power to order a stay should be exercised where appropriate; it will be appropriate where, balancing the interests of justice between the parties, the interests of justice require such an order: see Websyte at [109]; Commissioner of the Australian Federal Police v Zhao [2015] HCA 5; 255 CLR 46 at [36] per French CJ, Hayne, Kiefel, Bell and Keane JJ); Construction, Forestry, Mining and Energy Union v Australian Competition and Consumer Commission [2016] FCAFC 97; 242 FCR 153 at [22] per Dowsett, Tracey and Bromberg JJ (CFMEU v ACCC). 25 Fourth, an applicant is prima facie entitled to have their action tried in the ordinary course of the proceeding and business of the court: McMahon v Gould (1982) 7 ACLR 202 at 206 per Wootten J. It is a "grave matter" to interfere with this entitlement and "no litigation should be delayed except for good cause": McMahon at 206; Zhao at [39] per French CJ, Hayne, Kiefel, Bell and Keane JJ). The burden is on the defendant in a civil action to show that it is just and convenient that the plaintiff's ordinary rights should be interfered with: see McMahon at 206. 26 Fifth, the Court will not order a stay merely because related charges have been brought and criminal proceedings commenced. A stay may be appropriate if it is apparent that the accused it at risk of prejudice in the conduct of their defence in the criminal trial: Zhao at [35]; CFMEU v ACCC at [22]. 27 Sixth, the Court may stay a civil proceeding when a criminal prosecution has not commenced but is "on the cards" or "reasonably possible": see Australian Securities and Investments Commission v Craigside Co Ltd [2013] FCA 201; 93 ACSR 176 and Websyte at [109]. 28 Seventh, the risk of prejudice must be real: CFMEU v ACCC at [22]. Possible prejudice might relevantly consider: (a) prejudice to the accused's right to silence or privilege against self-incrimination (or exposure to civil penalties); and (b) the possibility that publicity might reach and influence jurors: Zhao [42]-[47]; Obeid at [4]; CFMEU v ACCC at [23], [44]-[46]. There was a dispute between the parties as to what evidence was required to establish the risk of real prejudice: see CFMEU v ACCC at [36]-[37] (as referred to by the General Manager). The General Manager complained that the lack of evidence by the respondents was fatal. So as to avoid wasted costs and Court resources I invited the respondents to address the criticism by putting on supplementary evidence of prejudice. Without conceding the obligation to do so the respondents (excluding Mr Eden and Mr Asmar) accepted the Court's invitation. That material is referred to below. 29 Eighth, the risk of prejudice to the applicant for the stay must be weighed against any prejudice as the result of the stay of the civil proceeding: see Zhao at [47], [50]; CFMEU v ACCC at [22]. 30 Ninth, each case must be judged on its own merits. The considerations that might individually, or cumulatively, be relevant to the exercise of the discretion are not fixed or closed: see McMahon at 206. 31 Tenth, in an appropriate case the civil proceedings may be allowed to proceed to a certain stage (for example, setting down for trial) and then stayed: see McMahon at 207.
The different position of different respondents 32 The General Manager properly conceded that this application falls to be determined on an "all or nothing" basis. By that he accepts that the allegations are "such that there would be difficulty in 'carving off' parts of the proceeding … and allowing them to proceed, whilst staying others." In other words, if there is a basis to grant a stay because a prosecution is on the cards for Ms Asmar and there is a real risk of prejudice to her criminal trial, the whole proceeding ought to be stayed for all respondents. I have approached the application on that basis and mostly focused on the circumstances of Ms Asmar. The approach of the parties was consistent with the position that if criminal proceedings were not on the cards for Ms Asmar, then they were not on the cards for the other respondents. Likewise, if the risk of real prejudice for Ms Asmar was not sufficient then it was not sufficient for the other respondents.
On the cards 33 As identified above, criminal proceedings have not commenced against any of the respondents. Ms Asmar applies for a stay of the proceeding on the basis that criminal proceedings against the respondents, particularly her, are "on the cards" or "reasonably possible": Re AWB [2008] VSC 473; 21 VR 252 at [86] (per Robson J), Websyte at [112], [117] (per Dodds-Streeton J), and Citation Resources Ltd v Landau [2016] FCA 1114 at [49] (per McKerracher J). 34 The parties referred the Court to authorities considering whether a prosecution was "on the cards". I consider a number of those below.
Australian Securities and Investments Commission (ASIC) v ActiveSuper Pty Ltd (No 5) [2013] FCA 369 35 In ActiveSuper, ASIC brought proceedings against seventeen defendants for a number of breaches of corporations legislation. By interlocutory application, the seventeenth defendant, Mr Craig Gore, sought a stay of the civil proceedings until ASIC provided a written undertaking that it would not institute criminal proceedings against him, nor brief the Commonwealth Director of Public Prosecutions with respect to any charge or indictment: see ActiveSuper at [1]. 36 When Mr Gore brought the interlocutory application, ASIC's investigation into criminal offences against Mr Gore and others was ongoing: see ActiveSuper at [4]. An ASIC Manager provided the Court with an update on the investigation. The update confirmed that the investigation was ongoing and that the ASIC Manager anticipated "that the investigation will require approximately 8 months" to conclude: see ActiveSuper at [5]. 37 Justice Gordon refused to grant a stay on the basis that it could not be said that there was "a reasonable possibility of a prosecution" of Mr Gore: see ActiveSuper at [19]. Gordon J found that a prosecution was not on the cards because the investigation into Mr Gore was "continuing and far from complete": see ActiveSuper at [19].
Australian Securities and Investments Commission (ASIC) v Craigside Co Ltd [2013] FCA 201; 93 ACSR 176 38 In Craigside, the applicant, ASIC, sought declarations against two individuals Mr Merity and Mr Nedderman for breaches of the Corporations Act 2001 (Cth) because they allegedly did not disclose the required information about their shareholdings. Although ASIC had commenced the civil proceedings against both Mr Merity and Mr Nedderman it was continuing to investigate Mr Merity for breaches of the Corporations Act 2001 (Cth). ASIC also refused to rule out that Mr Nedderman may be prosecuted in the future: Craigside at [2]. 39 Mr Merity and Mr Nedderman sought a stay of the civil proceeding to enable ASIC to determine whether it wished to prosecute them. Mr Merity and Mr Nedderman said the continuation of that civil proceeding in the face of future possible prosecution was an abuse of process that would unfairly prejudice them: Craigside at [6]. 40 Justice Jagot found that a prosecution of Mr Merity was on the card's because ASIC acknowledged that it was continuing to investigate Mr Merity's conduct, and one reason for the continuing investigation was to enable it to decide whether to prosecute Mr Merity: Craigside at [21]. Jagot J found that Mr Nedderman's conduct was "related to that of Mr Merity". Further, ASIC, in bringing civil proceedings against Mr Nedderman "must already believe it has a sufficient basis to establish that to the civil standard of proof that Mr Nedderman has contravened a provision of the Corporations Act involving an offence of strict liability": [21] of Craigside. On that basis, Jagot J said "it is difficult to characterise a prosecution of Mr Nedderman in respect of the same subject in this proceeding as not "on the cards" merely because ASIC has said he is not the subject of the investigation at present": [21] of Craigside. 41 Justice Jagot found that "by the requirements of this civil proceeding the legitimate interests of Mr Merity and Mr Nedderman in the prospective criminal prosecutions…may be significantly compromised": [22] of Craigside. 42 As a result Jagot J ordered a stay until ASIC advised whether it would institute criminal proceedings against Mr Merity and Mr Nedderman. Jagot J refused to grant a six month stay because ASIC was in the best position "to work out its priorities and its own timing": [25] of Craigside.
Citation Resources Ltd v Landau [2016] FCA 1114; 116 ACSR 41 43 Citation Resources sued Mr Landau for a breach of his director's duties and related relief: see Citation at [1]. Citation claimed that Mr Landau, as a director of Citation, caused a bank account to be opened with no other signatories, and caused, procured, authorised or acquiesced a number of payments being made from that bank account: see Citation at [1]. 44 Mr Landau sought a stay of the civil proceedings on the basis that criminal proceedings were on the cards. Justice McKerracher found the following steps had been taken by ASIC: see Citation at [52]-[53]: (a) ASIC had pursued and maintained a freezing order; (b) ASIC had applied for travel restraint orders and, in doing so, indicated that Mr Landau was potentially facing criminal charges; (c) ASIC had conducted a detailed investigation into Mr Landau, amongst others, relating to the same subject matter as the proceedings (as well as other matters). That investigation was into a number of suspected contraventions constituting criminal offences, not mere regulatory offences; (d) There had been examinations in relation to those topics they had consumed some seven hours; (e) the allegations made in the proceedings, as with the investigations by ASIC, are serious allegations; (f) a relevant ASIC officer had sworn to the fact that Mr Landau may potentially be facing criminal charge; (g) Mr Landau's financial resources were unlikely to extend, at least on their face, to being able to substantially contribute both to the defence of these proceedings and to resisting criminal proceedings; and (h) in light of his apparently scarce financial resources, it was not apparent that Citation would suffer substantial prejudice if civil proceedings were stayed. 45 However, McKerracher J found that it was "premature" to conclude that criminal prosecution was on the cards for at least four reasons: see Citation at [54]. First, although an ASIC officer deposed in another proceeding that Mr Landau was "potentially facing criminal action" as a result of an ASIC investigation (Citation at [22]), that reference was made in the context of activities involving two other companies in addition to Citation. 46 Second, Mr Landau had claimed the privilege against incrimination and in the same judgment McKerracher J refused to order discovery. Therefore, McKerracher J found that it was "not apparent at this stage what additional risk he would face if these civil proceedings continue, at least, say, until the time of commencing trial." 47 Third, given Mr Landau claimed the privilege, it would be unlikely he would be exposed to significant further costs prior to trial. 48 Fourth, allowing Citation to bring its case to court is a significant factor and should circumstances change, the question of a stay could be revisited.
Re Australian Property Custodian Holdings Ltd (in liq) (recs and mrgs apptd) (controllers apptd) (No 2) [2012] VSC 576; 93 ACSR 130 (Woolridge) 49 In Woolridge, the plaintiff, Australian Property Custodian Holdings Ltd (APCH), made claims in the Victorian Supreme Court (Supreme Court proceedings), against seven of its former directors and other parties, seeking to recover monies paid to companies controlled by Mr Lewski, the third defendant. ASIC simultaneously brought civil proceedings in this Court against the plaintiff and the first five defendants of the Supreme Court proceeding for breaches of their duties under the Corporations Act 2001 (Cth) (Federal Court proceeding). The relevant transactions were the same in the Supreme and Federal Court proceedings: see Woolridge at [1]. 50 The common defendants sought a stay of the Supreme Court proceedings until the hearing and determination of the Federal Court proceedings: see Woolridge at [2]. In that stay application, Mr Lewski "took a leading role" and many of the submissions of Mr Lewski were relied upon by the other defendants: see Woolridge at [18]. Mr Lewski submitted that the potential for ASIC to take criminal proceedings against him justified a stay: see Woolridge at [28]. Mr Lewski based that submission on the fact that he had been provided with a "s 19 notice" to appear for examination and his subsequent examination by ASIC. Mr Lewski also relied on a letter from ASIC sent in response to questions from his solicitors which stated that "[y]our letter requests that ASIC advise your client whether ASIC currently holds an intention to pursue prosecutions against him in relation to either civil penalty proceedings and/or criminal proceedings. ASIC's current investigation…is currently ongoing and no decision has been made by ASIC regarding what, if any, action should be taken.": see Woolridge at [31]. 51 Robson J found that there was "no evidence to support Mr Lewski's concerns" about the possibility of criminal prosecution "other than the fact that the possibility does exist that criminal proceedings might be taken": see Woolridge at [34]. Based on the above evidence, Robson J found that Mr Lewski had not established that "there is a reasonable possibility of criminal proceedings being laid against him.": see Woolridge at [34].
Re AWB [2008] VSC 473; 21 VR 252 52 In the Report of the Inquiry into certain Australian companies in relation to the UN Oil-for-Food Programme (Cole Report) Commissioner Cole found that each of Trevor Flugge, Paul Ingelby, Charles Stott, Peter Geary and Michael Long may have committed a criminal offence and recommended that those matters be referred to a Task Force. A Task Force comprised of Australian Federal Police, the Victoria Police and the Australian Securities and Investment Commission was established to consider possible criminal prosecutions. 53 ASIC had separately commenced civil proceedings against all of those individuals, and one further defendant (Mr Lindberg), in relation to overlapping issues. In the Cole Report, the Royal Commissioner found that Mr Lindberg "had not been guilty of any criminal conduct". 54 Mr Flugge inquired of the Task Force and the Manager of the Task Force "advised him that he was unable to indicate when the Task Force inquiries will conclude, although he would advise Mr Flugge if the Task Force inquiry should establish that formal criminal proceedings may issue against Mr Flugge": AWB at [17]. Robson J found that similar communications had been given to the other defendants, save that in relation to Mr Stott he had been informed charges were probable: AWB at [18] 55 Robson J found that criminal proceedings were a reasonable possibility for each defendant, save Mr Lindberg, and stayed the civil proceeding except for Mr Lindberg.
Websyte Corp Pty Ltd v Alexander (No 2) [2012] FCA 562 56 In Websyte, the applicant alleged that the respondents, Mr Alexander and Mr McGrath had breached their fiduciary obligations, breached their obligations of confidence, breached the applicant's copyright, and trespassed on its computer system: Websyte at [1]. 57 Mr Alexander and Mr McGrath had already been charged with unauthorised access to, and modification of, the applicant's restricted computer data pursuant to s 247G of the Crimes Act 1958 (Vic): Websyte at [2]. The Victoria Police had "also been investigating a contravention of s 132AJ of the Copyright Act 1968 (Cth)" and this investigation could have resulted in further and more serious charges. The respondent sought a stay of the civil proceeding pending the determination of any criminal proceedings. 58 Justice Dodds-Streeton found further serious criminal charges were on the cards and it was not in dispute that the actual and potential criminal charges involve the same subject matter: Websyte at [117]. Her Honour granted the stay on the basis that the defendants had already been prejudiced in the criminal trial that was on foot and there was a real risk that "the respondents' legitimate, rather than merely tactical interests, in the criminal trial may be significantly compromised": Websyte at [120].
Ms Asmar's (and the fourth, sixth and seventh respondents') submissions 59 Ms Asmar relied on the following facts (taken from the chronology above) to establish that criminal proceedings were "on the cards": (a) Victoria Police had executed search warrants on the offices of Commerce Press and the home of Peter Walsh and had seized documents, computers and phones; (b) Victoria Police had executed search warrants on the offices of the accountants of the Branch and seized property; (c) On 9 September 2024, Ms Asmar's solicitor sent a letter to Victoria Police which stated that it understood that Ms Asmar was being investigated by Victoria Police. (d) On 10 September 2024, Det Insp Jones wrote to Ms Asmar's solicitors saying that he was the "officer in charge of the Financial Crime Squad" and that "Ms Asmar is NOT currently under investigation" (Original emphasis). (e) On 10 September 2024, Mr Nathwani KC had a conversation with Det Snr Const Homberg from the Victoria Police Financial Crime Squad in which Det Snr Const Homberg said he was "assisting this job [Operation FCS-Quiz-2023] and later provided the details of the informant of the informant Det Snr Const Petrovska. (f) On 11 September 2024, Mr Nathwani KC emailed Det Snr Const Petrovska asking for confirmation that "Operation FCS-Quiz is an investigation into Peter Walsh, his business entities, Southern Publishing, and the Health Services Union/Health Workers Union?". In response and on 12 September 2024, Det Insp Jones emailed Mr Nathwani KC stating "…Ms Asmar is NOT currently under investigation…" (Original emphasis). (g) On 12 September 2024, Mr Nathwani KC emailed Det Insp Jones and stated that he has not answered the question asked and repeated the question. On 3 October 2024, Mr Nathwani KC sent a follow up email to Det Insp Jones and repeated his question. On 21 October 2024, Mr Nathwani KC sent a further follow up email to Det Insp Jones and stated, "Are you able to reply to the below, or at least confirm that you refuse to ?" On 21 October 2024, Det Jones emailed Senior Counsel for Ms Asmar and stated "…I won't be making any comment on any matters that may or may not be under investigation by the Financial Crime Squad". (h) On 14 November 2024, Victoria Police arrested Peter Walsh as part of their investigation in relation to "allegations of false invoicing linked to a union and a private company." 60 The respondents seeking the stay submit that a criminal prosecution is on the cards because, first, the police have obtained search warrants against Mr Walsh and the accountants for the Branch. These are persons related to this proceeding. To have obtained the search warrants, pursuant to s 465 of the Crimes Act 1958 (Vic), the respondents submit that a police officer must have sworn that they had reasonable belief that the properties that were searched and seized would have evidence of the commission of an indictable offence. Further, the Magistrate who issued the warrant was satisfied there were reasonable grounds to suspect that the granting of a search warrant would reveal evidence of, or commission of, an offence. 61 Second, Mr Walsh's arrest on 14 November 2024 and the statement from police that he was arrested in relation to "allegations of false invoicing linked to a union and a private company" indicates that the investigation is progressing and overlaps significantly with this proceeding. The respondents therefore submit that there is a reasonable possibility that criminal proceedings will be commenced against Ms Asmar and potentially others in respect of the subject of this proceeding.
General Manager and Mr Eden's submissions 62 The General Manager submits that, on the facts before the Court, a prosecution is not "on the cards" and the proposition that Ms Asmar and the other respondents will face criminal charges is a matter of "pure speculation". The General Manager submits that the evidence establishes that an investigation of some sort had been undertaken, or was being undertaken, into the Branch but there is no evidence as to whether the investigation was in relation to any particular individual (save that it was not Ms Asmar), nor the current status of the investigation. 63 Mr Eden submitted that the stay is precipitative. He says that there has been no clear indication to him, or it seems, any other respondent, that they are the subject of criminal investigation by Victoria Police.
Consideration 64 Whilst it is apparent that there has been investigation by Victoria Police into the circumstances related to those matters contained in the statement of claim in this proceeding, the status of that investigation is unknown. As to whether Ms Asmar is the subject of that investigation, the most explicit communication from Victoria Police is the email of 10 September 2024 from Det Insp Jones to Ms Asmar's solicitor confirming "that Ms Asmar is NOT currently under investigation" (Original emphasis). Det Insp Jones is the officer in charge of the Financial Crime Squad and in a position of authority to make such a representation. Det Insp Jones repeated the relevant contents of that email two days later in a communication to Ms Asmar's counsel, Mr Nathwani KC. I do not accept, as Ms Asmar contends that Det Insp Jones responses were hasty. 65 The email from Det Insp Jones was sent approximately 4 months after a warrant had been executed on the premises of Commerce Press and the home of Peter Walsh, and approximately 1 week after a warrant had been executed on the offices of the Branch's accountants. 66 On the material before the Court Victoria Police first became aware of the allegations against Ms Asmar in or about October 2023. In the 16 months since that time there has been no communication from Victoria Police suggesting that Ms Asmar will be charged. The emails identified above are to the contrary effect. 67 Mr Walsh was arrested on or about 14 November 2024. He was not charged. The current state of the investigation into Mr Walsh is unknown. I accept that the arrest of Mr Walsh affects the likelihood of charges against Ms Asmar, however the intentions of Victoria Police with respect to Mr Walsh or Ms Asmar are still unknown. Again, the only communications explicitly addressing the investigation into Ms Asmar are the September emails from Det Insp Jones. 68 The respondents (save Mr Eden) submitted that whilst charges under the Criminal Code 1995 (Cth) might be directed to the Union, any fraud offences under the Crimes Act 1958 (Vic) would necessarily be directed at an individual. Whilst I accept that much, the progress, status and detail of the investigation by Victoria Police, or the AFP is unknown. There is no evidence of any particular potential charges being pursued by Victoria Police, or the AFP, against the respondents. 69 In Craigside Jagot J had the advantage of the investigator (ASIC) being the party before her in the civil proceeding. It was ASIC that was to decide whether to prosecute the individuals (or to brief the Commonwealth Director of Public Prosecutions with respect to the laying of a charge or indictment). ASIC confirmed to her Honour that it was continuing to investigate Mr Merity (and her Honour concluded that it was continuing to do so to decide whether to prosecute him). ASIC also did not rule out a prosecution of Mr Merriman although it said he was not the subject of a prosecution at present. Having found those things her Honour was positively satisfied that a prosecution was on the cards for Mr Merity and for Mr Nedderman. Unlike Craigside the parties are not in a position to provide any current information as to the status or ongoing intention of the investigation by Victoria Police (or the AFP). The current status and intention of the investigations are unknown. 70 In Websyte there were already criminal charges, and it was known that Victoria police were investigating further charges. In Citation McKerracher J found that a relevant ASIC officer had sworn to the fact that Mr Landau may potentially be facing a criminal charge but still considered it premature to find that a criminal prosecution was on the cards. McKerracher J determined that allowing Citation to bring its case was a significant factor against a stay and that the question of a stay could be revisited should circumstances change. The likelihood of criminal charges is less certain for Ms Asmar and the other respondents than it was for Mr Landau in Citation. There is also less certainty and evidence about the investigation or its details than was before the Court in ActiveSuper and Woolridge. 71 I must assess the reasonable possibility of a prosecution of Ms Asmar (and the other respondents) on the evidence before me. The status of any current investigation by Victoria Police is unknown. The intentions of Victoria Police with respect to Ms Asmar or the other respondents is unknown. I accept the submissions of the General Manager that criminal charges against Ms Asmar and the other respondents is presently a matter of speculation. Whilst proceedings against Ms Asmar might be a possibility I am not satisfied on the evidence before me that they are on the cards or a reasonable possibility. 72 Circumstances may change. The respondents are at liberty to return to Court at short notice in the event of any material change in circumstances.
Respondents' (save Mr Eden) submissions 73 The respondents submit that they will face a risk of "real prejudice" in the conduct of their defence of any criminal proceedings if a stay is not granted. 74 The respondents submit the prejudice will manifest in: (a) Their fundamental right to silence being abrogated; (b) Costs being thrown away if the proceedings progress but are then automatically stayed by operation of s 312 of the RO Act; and (c) A risk of jury contamination for any criminal proceeding because of the publicity generated by this proceeding. 75 The respondents also submit that any prejudice must be weighed between the respondents and the applicant. The respondents submit that the only prejudice to the applicant will be their proceedings being temporarily delayed. The respondents further submit that even this form of prejudice may not materialise because if criminal proceedings are successful, the proceeding will be dismissed. 76 The respondents also rely on affidavits of their clients which state that they would like to properly defend these proceedings and that if they were to do so, there is a real risk any defence of a criminal prosecution would be prejudiced. The affidavits of Mr Atkinson and the Second Affidavit of Ms Szumer (concerning Ms Barclay) do not state that they would prefer to waive the privilege against self-incrimination and file a positive defence. Ms Asmar relevantly deposes: Based on the information available to me and circumstances at this present time, I wish to be able to participate fully in these proceedings in relation to the allegations made against me by the General Manager of the Fair Work Commission, including by putting on a positive defence…
General Manager and Mr Eden's submissions 77 The General Manager submits that the courts have repeatedly emphasised that interference with the usual course of proceedings is a "grave" matter and prima facie, the applicant is entitled to have his civil action tried in the ordinary course: Zhao at [39]. 78 The General Manager further submits that there is insufficient evidence of real prejudice to the respondents to justify the granting of a stay. In response to the affidavits of the respondents the General Manager states that the affidavits of Mr Atkinson and the second affidavit of Ms Szumer (concerning Ms Barclay) are of no assistance where the stay relies on the position of Ms Asmar. The General Manager submits that the risk of a criminal prosecution is lower for Mr Atkinson and Ms Barclay than Ms Asmar. Further, the General Manager submits that because they refused to say that they intend to waive their privilege, there is insufficient evidence to establish real prejudice to Mr Atkinson and Ms Barclay. Mr Asmar filed submissions but did not put on any affidavit material. Ms Georgiev and Mr Katsis did not participate in the stay application. 79 The General Manager submits that Ms Asmar used "highly equivocal" language in her affidavit stating that she intends to waive the privilege and the court should infer that this is a deliberate choice, and that Ms Asmar is likely to invoke the privilege. On that basis, the General Manager submits that the Court cannot be satisfied that Ms Asmar has any present intention of taking any of the steps necessary to properly defend herself (given she does not presently need to), in the absence of a stay. 80 Mr Eden submits that the respondents are able to claim the penalty privilege in this proceeding. Accordingly, he says the respondents can remain silent until the General Manager closes his case. Mr Eden says allowing the case to proceed would not cause irreparable harm to his, or the other respondents' rights.
Consideration 81 In considering Ms Asmar's claims of immediate prejudice arising from any abrogation of the privilege, it is relevant to consider when Ms Asmar might choose to abrogate that privilege. Whilst Ms Asmar states that she wishes to "fully participate in these proceedings … including by putting on a positive defence" she does not explain whether she intends to do that immediately, soon or at all prior to the close of the applicant's case. It is not clear on the evidence when she proposes to put on a positive defence. 82 It is certainly open to Ms Asmar to claim her privilege up until the close of the applicant's case: see Australian Securities and Investments Commission v Mining Projects Group Ltd [2007] FCA 1620; 164 FCR 32, Australian Building and Construction Commissioner v O'Halloran [2021] FCAFC 185; Australian Competition and Consumer Commission v FFE Building Services [2003] FCAFC 132; 130 FCR 37. If she does claim the privilege until that time she: (a) will not be obliged to put on a positive defence until that time; (b) will not be obliged to provide any discovery until that time; and (c) will not be obliged to put on any outline or affidavit of her evidence until that time. As I say above, it is not clear when Ms Asmar and the other respondents intend to waive their privilege and put on a positive defence. I am not satisfied that any prejudice from requiring the respondents to plead, with a claim of privilege and no positive defence, outweighs the prejudice to the applicant in being denied the continuation of his proceeding. I weigh the submission, that such a course may deny the respondents any early settlement arising from a compelling positive defence, but I am not satisfied that consequence, at this time, justifies interfering with the General Manager's entitlement to have his action tried in the ordinary course. 83 I accept that it is possible that Ms Asmar, and the other respondents, may have costs thrown away if they participate in this proceeding and then it is permanently stayed or dismissed (see s 312(2) of the Act) as the result of criminal charges. That submission assumes that criminal charges are laid and successful such that the civil proceedings are not resumed: see s 312(2) of the Act. I accept that if the civil proceedings are resumed there may still be some costs thrown away. In the immediate term I anticipate the potential costs thrown away will be relatively modest. The respondents are at liberty to return to Court at short notice in the event of any material change in circumstances. In any event those costs do not outweigh the interference with the General Manager's entitlement to have his proceeding heard and determined. 84 The potential prejudice of adverse publicity contaminating a jury in any criminal proceeding must be assessed in circumstances where a civil trial is unlikely before late 2025. The risk that a jury might be affected by a determination in a civil proceeding is a significant period away from materialising. I am not satisfied such publicity, at this time, should be accorded significant weight in determining whether to grant a stay: see ActiveSuper at [23]. 85 As I say above the General Manager concedes that if there is a real risk of prejudice to Ms Asmar (and her prosecution is on the cards) then the whole proceeding ought to be stayed for all respondents. In those circumstances I have focused on the prejudice to Ms Asmar whilst endeavouring to address the submissions of all respondents. Consistent with the parties' submissions, where I am not satisfied that a prosecution is on the cards for Ms Asmar and that any prejudice justifies a stay for Ms Asmar, it follows that it is not so for the other respondents. 86 It is a grave matter to interfere with the usual course of proceedings and the General Manager is prima facie entitled to have his civil action tried in the ordinary course. That is to be assessed in the context of the General Manager performing a regulatory function in this proceeding: Australian Competition and Consumer Commission v Construction, Forestry, Mining and Energy Union [2016] FCA 504 at [79]-[80] per Middleton J. I accept that the General Manager's proceeding may by stayed (temporarily or permanently) or dismissed by operation of the Act in any event. However, that will only occur where criminal proceedings are brought, and I am not presently satisfied that they are on the cards. 87 Further, the period of any temporary stay is at present difficult to predict. Ms Asmar's proposed stay operates until Victoria Police have determined not to charge her (in respect of the same conduct alleged in this proceeding) and have communicated that decision to her. The evidence before me gives me no information about when that decision might be made or communicated. It is possible, on the material before me, that a stay will operate for a significant period of time with no criminal charges being laid. That has the potential to be a significant interference with the General Manager's entitlement to have his civil action tried in the ordinary course: Zhao at [39]. 88 Balancing the potential risk of real prejudice of all parties I am not satisfied that a stay of the proceeding is appropriate at this time.
CONCLUSION AND DISPOSITION 89 In all of the circumstances, and balancing justice between the parties, I am not satisfied that a stay is appropriate at this time. The interlocutory application of Ms Asmar is dismissed. Section 329 of the Act restricts the Court in awarding costs. No costs order was sought or will be made. I will list the matter for a case management hearing at a time convenient to all of the parties and the Court. I certify that the preceding eighty-nine (89) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Dowling.
Associate: Dated: 11 February 2025 SCHEDULE OF PARTIES VID 835 of 2024 Respondents Fourth Respondent DAVID ASMAR Fifth Respondent DAVID EDEN Sixth Respondent LEE ATKINSON Seventh Respondent RHONDA BARCLAY
General Manager, Fair Work Commission
Asmar
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