Grocon Group Holdings Pty Limited v Infrastructure NSW

Category 4 Documents

1. The claim for public interest immunity is now advanced by The Cabinet Office (TCO) through an affidavit affirmed on 9 November 2023 by Ms Kathryn Boyd, the Deputy Secretary and General Counsel of TCO. TCO claims public interest immunity in respect of 254 documents.
2. Broadly speaking, the documents fall into five categories: 1. Documents recording the deliberations or decisions of Cabinet; 2. Submissions to Cabinet or a committee of Cabinet and drafts of those documents; 3. Documents attached to Cabinet Committee submissions which were prepared for the purpose of those submissions, including drafts; 4. Briefings to Ministers on Cabinet minutes, Cabinet agendas or Cabinet decisions; 5. Documents concerning Cabinet minutes and briefings to Ministers or which disclose the contents of Cabinet submissions, deliberations and decisions.
3. The documents in question concern three broad topics: 1. The selection of Grocon as the preferred bidder for the development of Central Barangaroo; 2. The negotiations between the Authority and Lendlease and Crown concerning Lendlease's and Crown's rights under the Sight Lines Clauses and the ultimate resolution of the dispute between INSW on the one hand and Crown and Lendlease on the other concerning those clauses; 3. The transfer of the rights to develop Central Barangaroo from Grocon to Aqualand.
4. Section 130(1) of the Evidence Act 1995 (NSW) which essentially reflects the position at common law states: If the public interest in admitting into evidence information or a document that relates to matters of state is outweighed by the public interest in preserving secrecy or confidentiality in relation to the information or document, the court may direct that the information or document not be adduced as evidence.
5. In carrying out the balancing exercise required by s 130(1), the Court under s 130(5) is required to take into account among other things: (a) the importance of the information or the document in the proceeding, (b) … (d) the likely effect of adducing evidence of the information or document, and the means available to limit its publication, (e) whether the substance of the information or document has already been published, …
6. A claim of public interest immunity under s 130 of the Evidence Act involves a balancing exercise "[t]hat requires identification of the scope, content and importance of (a) the public interest in admitting information or a document into evidence, and of (b) the public interest in preserving secrecy or confidentiality in relation to that information or document. It is only when the latter outweighs the former that the court is empowered to direct that the information or document not be adduced in evidence": Ku-ring-gai Council v West [2017] NSWCA 54; (2017) 95 NSWLR 1 at 24 [85] per Basten JA (with whom Macfarlan JA agreed at 33 [128]); Commonwealth v Northern Land Council [1993] HCA 24; (1993) 176 CLR 604 at 616 per Mason CJ, Brennan, Deane, Dawson, Gaudron and McHugh JJ.
7. Although documents recording the deliberations of Cabinet do not attract absolute immunity, it is well established those documents fall "within a class of documents in respect of which there are strong considerations of public policy militating against disclosure regardless of their contents": Northern Land Council at 616 per Mason CJ, Brennan, Deane, Dawson, Gaudron and McHugh JJ. As their Honours went on to explain "… it is only in a case where there are quite exceptional circumstances which give rise to a significant likelihood that the public interest in the proper administration of justice outweighs the very high public interest in the confidentiality of documents recording Cabinet deliberations that it will be necessary or appropriate to order production of the documents to the court."
8. The rationale behind that very high public interest includes that secrecy is a necessary condition for candour and that secrecy supports the principle of collective responsibility for any decision which may be made: Northern Land Council at 615.
9. Although the claim is strongest in the case of documents recording the deliberations of Cabinet, it has been held that it extends to documents submitted and considered by Cabinet, documents brought into existence for the purpose of preparing a submission to Cabinet and documents and communications passing between high level or Government officials relating to Cabinet proceedings: see Northern Land Council at 614-5; Spencer v Commonwealth (2012) 206 FCR 309 at [42] - [43]; Australian Competition and Consumer Commission v NSW Ports Operations Hold Co Pty Ltd (No 3) [2020] FCA 1766 at [56] - [59]. One rationale for the protection of documents falling within these classes is that they tend to reveal what occurred in Cabinet. Another is that the protection encourages frank advice from public officials tasked with giving advice to Cabinet, although the significance of that consideration was left open by Mason CJ, Brennan, Deane, Dawson, Gaudron and McHugh JJ in Northern Land Council at 614-5. In that case their Honours said: [D]ocuments prepared outside Cabinet, such as report or submissions, for the assistance of Cabinet … are often referred to as Cabinet documents. When immunity is claimed for Cabinet documents as a class and not in reliance upon the particular contents, it is generally upon the basis that disclosure would discourage candour on the part of public officials in their communications with those responsible for making policy decisions and would for that reason be against the public interest. The discouragement of candour on the part of public officials has been questioned as a sufficient, or even valid, basis upon which to claim immunity. On the other hand, Lord Wilberforce has expressed the view that, in recent years, this consideration has "received an excessive dose of cold water" (quoting Burmah Oil Ltd v Bank of England [1980] AC 1090 at 1112). Whatever the precise reason, it cannot be doubted that Cabinet documents are entitled to some degree of protection.
10. Grocon submits that the documents in respect of which a claim for public interest immunity is made are likely to be material and "in some cases significantly material" to the following issues in the case: 1. The reasons why INSW entered into the CENDA with Grocon, and then refused to issue the Sight Lines Resolution Notice to Grocon, when it could have done so from at least 19 August 2019; 2. The dealings between INSW and the NSW State Government with Oxford (which provided financing to Grocon) and Aqualand and their motivations and various interests in so engaging; 3. The consideration given by INSW and the NSW Government, or those who advised them of the decision to issue the Sight Lines Resolution Notice to Aqualand on 26 September 2019; 4. Whether INSW failed to act in good faith. Each of these matters is said to be relevant to Grocon's case that INSW engaged in unconscionable conduct.
11. In support of its contention that the documents should be produced, Grocon points to evidence that suggests that the State Government was extensively involved in the matters the subject of these proceedings. It also criticises Ms Boyd's evidence on the basis that the evidence is too general and on the basis that Ms Boyd is not in a position to provide direct evidence of the claim for public interest immunity because she was only appointed to her position of Deputy Secretary recently and appears not to have read the documents herself. Grocon also submits that the claim for public interest immunity is weak in this case because the documents relate to events that occurred a number of years ago, they could no longer be regarded as controversial and the matters to which they relate were the subject of a Parliamentary Inquiry which conducted public hearings at which the Premier, Secretaries and Heads of Department gave evidence. Finally, Grocon points to the fact that the documents concern contractual matters and commercial undertakings.
12. In considering these submissions, it is relevant to bear in mind that INSW originally claimed public interest immunity over 690 documents. TCO has abandoned many of those claims, with the result that Grocon now has a substantial number of documents which shed light on the communications between the Authority and the government. Those documents include a presentation dated 23 August 2019 provided by Mr Tim Robertson, formerly Executive Director of INSW, to Mr Tim Reardon, the then Secretary of the Department of Premier & Cabinet, in which Mr Robertson sets out INSW's position following the conclusion of the negotiations between INSW, Crown and Lendlease concerning the dispute about Crown and Lendlease's rights under the Sight Lines Clauses.
13. Although Ms Boyd's affidavit is expressed in general terms, its principal purpose is to describe the nature of the documents in respect of which TCO continues to claim public interest immunity and to attach a brief description of each of those documents. It is true that Ms Boyd does not seek to identify the reasons why the information the documents contain remains confidential. But in my opinion, that criticism of the affidavit is misplaced. The claim for immunity in this case is made on the basis that the documents fall within a class or classes of document which by their nature are entitled to protection - that is, on the basis that they are properly classified as Cabinet documents or documents recording the deliberations of Cabinet. It is apparent from the documents in respect of which the immunity is not pressed that TCO does not maintain that the documents should be protected because of their contents.
14. Most of Grocon's submissions are directed at establishing that the contents of the documents no longer deserve protection (if they ever did). The contents of the documents may be relevant to the balancing exercise. But that is not the primary question in this case. The question in this case is whether the public interest in the production of the documents outweighs the public interest in preserving the confidential nature of Cabinet deliberations and Cabinet documents. In the present case, it may be accepted that that public interest is not as strong as it may be in other cases. The Cabinet decisions were taken some time ago and it could be said that they relate to commercial matters. More significantly, the decisions made by government, and Cabinet in particular, have been the subject of a public inquiry and report, although there is no suggestion that Cabinet documents or deliberations were revealed as part of that inquiry. Those matters, however, do not alter the fact that the documents fall within classes which generally are thought to be entitled to some degree of protection.
15. Grocon submits that whatever degree of protection the documents might be entitled to, it is outweighed by the public interest in these proceedings being decided on all relevant evidence. However, Grocon makes no attempt to identify with any precision the elements of its case on unconscionable conduct or how the documents it seeks may assist it in proving that case. The unconscionable conduct case will depend largely on the negotiations between INSW and Crown and Lendlease in relation to the Sight Lines Clauses and between INSW and Aqualand and others in relation to Aqualand taking over Grocon's rights and the circumstances in which and the reasons why INSW did not issue a Sight Lines Resolution Notice to Grocon but did to Aqualand. Grocon is obviously able to lead evidence of what it was told and it has, or is able to obtain, all the documents from INSW, Crown, Lendlease, Aqualand and others relating to those matters. That material includes INSW's internal communications relating to those matters. As I have explained, it also includes a substantial number of documents in which INSW has reported to the government or senior members of the public service on those matters. The question is what, realistically, are the documents in respect of which public interest immunity continues to be maintained going to add to what Grocon already knows? Grocon does not seek to answer that question. It makes no attempt to identify gaps in its knowledge or propositions it may wish to test.
16. Consistently with what was said in Northern Land Council at 619, copies of the documents in respect of which a claim for public interest immunity continues to be made have been provided to the Court so that they can be inspected to determine "whether the relevance of the material to the proceedings in which disclosure is sought is sufficient … to justify disclosure". I have not looked at each of the documents. However, I have looked at the documents identified by TCO as samples and a number of others. It is not apparent to me that any of them would be assistance to Grocon in its case or that any of them would add anything to what Grocon already knows about what INSW did or its reasons for acting in the way it did.
17. As I have explained, there remains a public interest in maintaining the immunity in order to protect the processes of Cabinet. In my opinion, that public interest is not outweighed in this case by the public interest in ensuring that all relevant evidence is before the Court.

Category 6 Documents

1. In my earlier judgment, I concluded that Grocon had waived privilege over certain legal advice it had received on the Sight Lines Clauses and INSW's obligation to issue a Sight Lines Resolution Notice. It is Grocon's contention that applying the same principles, INSW must be taken to have waived privilege in relation to legal advice it received on the same matters.
2. I set out the principles applicable to waiver in my earlier judgment. It is not necessary to repeat those principles here. Suffice it to say that a waiver arises from conduct that is inconsistent with the maintenance of the confidentiality that the privilege is designed to protect: see my earlier judgment at [12].
3. In the case of Grocon, I concluded that Grocon had waived legal professional privilege in two ways. First, Mr Easy, the Consultant General Counsel of Grocon, had sworn affidavits in which he gives evidence that he formed views on certain matters. I concluded that by swearing those affidavits he had waived privilege on advice given by him on those matters. It was inconsistent for Grocon both to assert the claim for privilege over communications from Mr Easy expressing his views on those matters and to serve an affidavit from Mr Easy about his views on those matters. Second, Mr Grollo, the Chief Executive Officer of Grocon, has sworn affidavits giving evidence that had he known certain matters he would have acted differently. I held that that involved an implied assertion that Mr Grollo had not been told those matters. It was inconsistent for Grocon to rely on that evidence and at the same time maintain privilege on legal advice that had been given to Grocon (and Mr Grollo in particular) on those matters.
4. On the present application, Grocon maintains that the waiver arises from INSW's list response and from affidavits served by INSW. It is not necessary to identify each paragraph of the list response and of the affidavits which are said to give rise to the waiver. Some examples suffice.
5. So far as the list response is concerned, para 227(c) is typical. That paragraph pleads that the defendant: [A]dmits at no point prior to 26 September 2019 could the Authority have issued a notice to Grocon Holdings and Grocon CB indicating that the Sight Lines Negotiations had been resolved to its satisfaction or concluded on a basis that permitted the Central Barangaroo Development to have at least 120,000 square metres of ADGFA and a Block 5 Tower of at least RL 120; …
6. So far as the affidavit evidence is concerned, Mr Ronald Finlay, who was the principal negotiator on behalf of the Authority, has sworn an affidavit on 28 July 2021 in which he says (at para 160): While I did not agree with Crown and Lendlease about their interpretation of the Sight Lines Clauses, I appreciated that the Sight Lines Clauses were vague and presented a risk to the development at Central Barangaroo.
7. Another example is evidence given by Mr Timothy Robertson, the Executive Director Strategy and Operations of the Authority, who states in an affidavit sworn on 15 December 2021 (at para 432): I considered that providing Grocon with a Sight Lines Resolution Notice would be complicated for a number of reasons. First, I thought Grocon was insolvent. On two separate occasions, the Authority had paid for the preparation of planning work for Central Barangaroo that would have normally been funded by the Central Developer, because Grocon did not have the capacity to pay for the works themselves. Grocon's financial position had only deteriorated further beyond that point and they had a number of creditors actively looking to recover unpaid debts. I thought it was unlikely Grocon had the capacity to commence the project, let alone complete it … As I considered Grocon was likely to sue the Authority in any event, if a Sight Lines Resolution Notice were to be issued, to my mind, it was preferable if the sale transaction had completed by the time the notice had to be and for the development to progress with a developer who was not also suing the Authority.
8. In my opinion, none of this material involves a waiver of privilege over advice received by the Authority about the meaning of the Sight Lines Clauses or the obligation of the Authority to issue a Sight Lines Resolution Notice.
9. The list response involves an objective assertion. Although INSW may have received legal advice on the matter, the list response does not involve any assertion about the contents of any advice INSW received in the past. There is no inconsistency in asserting that objectively the correct position is X and maintaining that previous advice received in relation to X remains confidential. If Grocon's submission is correct, whenever a party asserts a particular proposition in a pleading, it is to be taken to have waived privilege in legal advice it has received on that matter. That is plainly not correct.
10. A similar point applies to the evidence relied on by Grocon. There is no inconsistency in a witness asserting that he or she formed a particular opinion and maintaining confidentiality in advice that may have been relevant to the formation of that opinion. Obviously, the position would be different if the witness asserted that he or she relied on that advice in forming the opinion. It would also be different if the witness asserted that he or she had no reason to believe a particular matter and it was likely that advice had been given on that matter. As in the case of Mr Easy, the position would also be different if the witness gives evidence of the opinion he or she formed and a claim for privilege is made in respect of document that record the witness's opinion on that subject. It would be inconsistent for a witness both to express an opinion on a matter and claim that documents in which the same witness has expressed an opinion on the same subject matter remains confidential. However, as the Full Court of the Federal Court made clear in Macquarie Bank Limited v Arup Pty Limited [2016] FCAFC 117, the mere fact that the privileged advice is relevant to an issue in the case, including an issue of reliance, does not mean that there has been a waiver of the privilege.

Orders and Costs

1. TCO abandoned the claim for immunity in respect of a large number of documents and it was appropriate that the claim in respect of the remaining documents be supported by an affidavit that provided a description of each of the documents. Accordingly, it seems appropriate that there should be no order for costs in relation to Category 4 documents. INSW was successful in relation to the Category 6 documents so that it might be thought that it should be entitled to its costs of that aspect of the motion. However, the notice of motion filed on 31 August 2023 dealt with a number of other categories of document which were not pressed and the parties made no submissions in relation to costs. In those circumstances, I propose to stand the motion over to 2 February 2024 to deal with the question of costs if costs cannot be agreed.
2. Accordingly, the orders of the Court are: 1. the relief sought in paragraphs 4 and 6 of the plaintiffs' notice of motion filed on 31 August 2023 be dismissed; 2. the motion be stood over to 2 February 2024 to deal with any outstanding questions.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 12 December 2023