Jilani v Wilhelm

Background 5 The appellant ("Ms Jilani") is an officer of the Australian Federal Police ("the AFP"). Shortly before 7 July 2004 she was contacted by an officer of the Australian Taxation Office ("the ATO") who requested her to obtain and execute a search warrant in the form which is the subject of these proceedings. 6 Ms Jilani considered the request from the ATO and, according to an affidavit sworn by her in the present proceedings on 12 October 2004, satisfied herself that there were sufficient grounds to request a magistrate to issue a search warrant. 7 Having so satisfied herself Ms Jilani attended before a magistrate, Mr William Joseph McKay ("Mr McKay") at the Brisbane Magistrates Court on 7 July 2004. She attended with an unnamed officer from the ATO. She said in her affidavit that she did not swear any information herself. It is apparent from this that it was the unnamed ATO officer who swore the information. Mr McKay considered Ms Jilani's request and, satisfied by the information, issued the warrant as issuing officer within the meaning of s 3E of the Crimes Act. 8 Section 3E(1) of the Crimes Act provides that an issuing officer may issue a warrant to search premises if the officer is satisfied by information on oath that there are reasonable grounds for suspecting that there is, or that there will be within 72 hours, evidential material at the premises. 9 It has not been suggested that Mr McKay did not have reasonable grounds for suspicion of the necessary matters under s 3E; see George v Rockett (1990) 170 CLR 104 ("George v Rockett"). Nevertheless, Mr McKay was joined as the first respondent in the proceeding which, inter alia, impugns the decision to issue the warrant. Mr McKay filed a submitting appearance and was not represented on the application before Finkelstein J, nor did he appeal. 10 The warrant stated that Mr McKay was satisfied by information on oath that there were reasonable grounds for suspecting that there was evidential material at the premises of Blake Dawson Waldron ("Blakes") at 123 Eagle Street, Brisbane, which satisfied three stated conditions. 11 The first condition described in general terms, the type of documents to be searched for under the warrant. The second condition provided that the documents relate inter alia to Mr Michael Perry Dempsey ("Mr Dempsey"), Mr Otto Heinrich Wilhelm ("Mr Wilhelm"), Markit Pty Limited ("Markit") and Urinda Pty Limited ("Urinda"). Mr Dempsey, Mr Wilhelm, Markit and Urinda are the applicants in the proceedings. They are the respondents to the appeal. We will refer to them collectively as "the applicants". 12 The third condition was that the documents provide reasonable grounds for suspecting that they would afford evidence as to the commission of two offences by Mr Dempsey and Mr Wilhelm. The offences were stated to be contravention of s 134.2(1) of the Criminal Code Act 1995 (Cth) ("Criminal Code") by dishonestly obtaining an advantage for themselves from the Commissioner of Taxation ("the Commissioner"), namely a reduction in the quantum of the tax debt owed to the Commissioner by Markit and Urinda. Mr Dempsey and Mr Wilhelm were said to be directors of those companies. 13 The warrant authorised Ms Jilani to enter and search the premises of Blakes. It authorised Ms Jilani by virtue of s 3F(1) of the Crimes Act, as the executing officer, to search for evidential material that satisfied all of the three specified conditions. It also authorised Ms Jilani, by virtue of s 3G of the Crimes Act to obtain such assistance as was necessary and reasonable in the circumstances.

The Deed of Settlement 14 On the same day as the warrant was issued, that is, on 7 July 2004, the Commissioner entered into a Deed of Settlement ("the Deed of Settlement") with the applicants. Finkelstein J considered that the Deed of Settlement, and the fact that it was entered into on the day when the warrant was issued, were matters of some significance which justified the grant of leave to amend the application. The Deed of Settlement is referred to in the application but there is no express reference to it in the grounds upon which judicial review is sought. 15 The recitals to the Deed of Settlement record that the Commissioner had commenced proceedings against Markit ("the Markit proceedings") and Urinda ("the Urinda proceedings") in the Supreme Court of Queensland to set aside Deeds of Company Arrangement entered into by Markit and Urinda which had apparently entered Voluntary Administration under Part 5.5 of the Corporations Act 1989 (Cth). The recitals also record that the Commissioner claimed that Markit and Urinda were liable for tax instalments, that is to say group tax under Divisions 8 and 9 of Part VI of the Income Tax Assessment Act (1936) (Cth) ("Income Tax Assessment Act"). 16 In addition, the recitals recorded that the Commissioner had commenced separate proceedings against Mr Dempsey and Mr Wilhelm ("the District Court proceedings") claiming moneys from them as directors of Markit and Urinda. Although not expressly mentioned in the recitals, it is plain that the District Court proceedings sought recovery of the tax instalments for which Mr Dempsey and Mr Wilhelm were personally liable as directors of Markit and Urinda pursuant to Divisions 8 and 9 of Part VI of the Income Tax Assessment Act. 17 Under the Deed of Settlement the parties agreed to resolve the Markit proceedings, the Urinda proceedings and the District Court proceedings. 18 Clause 2(a) provided that Mr Dempsey and Mr Wilhelm would pay or cause to be paid to Messrs Blake Dawson Waldron, the Commissioner's solicitors, the sum of $600,000 ("the Settlement Sum") by 5 pm on 8 July 2004. 19 Clause 2(b)(iv) provided that upon receipt of the Settlement Sum the Commissioner would release the applicants from their liability for the unpaid liabilities of Markit and Urinda. 20 Clause 2(b) also provided that upon receipt of the Settlement Sum the Commissioner would, within 24 hours, instruct its solicitors to deliver to Messrs Clayton Utz, the solicitors for the applicants, Notices of Discontinuance of the Markit proceedings, the Urinda proceedings and the District Court proceedings. 21 Clause 2(c) was of considerable importance to the reasons of Finkelstein J. That clause provided that upon service of the Notices of Discontinuance, Mr Dempsey, Mr Wilhelm and Clayton Utz:- "… are entitled to collect from the solicitors for the Commissioner all documents (originals and copies) as are held by the solicitors for the Commissioner which are the property of Markit, Urinda, Dempsey or Wilhelm in relation to the Markit proceedings, the Urinda proceedings and the District Court proceedings including the following documents …." 22 The documents which were listed in clause 2(c) consisted of minutes of meetings and a management agreement. Those documents were said to have been referred to in the Statement of Claim in the Markit proceedings and in the Urinda proceedings, and in the case of some of the minutes, referred to in an affidavit filed in one of the proceedings. 23 There was no undertaking in the Deed of Settlement that Blake Dawson Waldron held the specified documents, but this was dealt with in a separate letter dated 7 July 2004 handed over on settlement. Though not in evidence before this court, it was not in issue that the letter contained an undertaking that Blakes held the relevant documents.

The Execution of the Warrant 24 On 8 July 2004, Ms Jilani and another AFP agent attended at the offices of Blakes for the purpose of executing the warrant. Ms Jilani was assisted by a number of officers from the ATO in executing the warrant. Various documents were seized and removed to AFP headquarters in Brisbane. Ms Jilani then handed over the documents to Mr Phillip Bell from the ATO Serious Non-Compliance Unit. 25 In her affidavit of 12 October 2004 setting out the relevant events including the seizure and handing over of the documents, Ms Jilani swore that she had no further involvement with the investigation that gave rise to the issue and execution of the warrant. 26 At the time of execution of the warrant at Blakes on the morning of 8 July 2004, a partner of that firm telephoned a partner of Clayton Utz to inform him that the AFP were in the course of executing the warrant. 27 Later on 8 July 2004, Clayton Utz wrote to Blakes complaining that the effect of execution of the warrant was that the Commissioner would not fulfil his obligations under clause 2(c) of the Deed of Settlement to make relevant documents available for collection. The letter stated that the Settlement Sum had already been paid to Blakes. Clayton Utz demanded that Blakes undertake not to disperse the funds without their consent. 28 Blakes replied to Clayton Utz by fax on 8 July 2004. The substance of the letter was to deny any breach of clause 2(c) of the Deed of Settlement and to state that Blakes held the Settlement Sum on trust for the Commissioner. The letter concluded by stating that if Clayton Utz could establish an entitlement to repayment of the Settlement Sum, clearly the Commissioner would be capable of making the payment. 29 Later on 8 July 2004, Clayton Utz replied to Blakes' fax asserting that it would be open to a Court to determine that the Settlement Sum paid into Blakes' trust account was held on trust for Mr Dempsey, Mr Wilhelm, Markit and Urinda. 30 Clayton Utz wrote a follow up letter to Blakes on 9 July 2004 seeking an explanation for the letter of undertaking dated 7 July 2004 which was handed over on settlement. The letter put Blakes on notice of pending litigation in relation to the ownership of, and entitlement to, the Settlement Sum. 31 On 13 July 2004, Clayton Utz wrote to the AFP requesting that, prior to taking any action against or requesting any information from the applicants, the AFP contact a named partner of the firm. On 14 July 2004 the AFP replied as follows:- "We acknowledge receipt of your letter dated 13 July 2004. We wish to advise you that the only interest the AFP had in your clients was in the execution of a Section 3E Crimes Act 1914 search warrant executed on behalf of the Australian Taxation Office. The AFP involvement in this matter has been completed at this time."

The Amended Application for an Order of Review 32 In the application as originally filed, [1] stated that review was sought of the decision of Ms Jilani to swear an information that she had reasonable grounds for suspecting that the applicants had committed an offence against the laws of the Commonwealth. 33 In an affidavit in support of the amendments filed on 22 November 2004, the applicants' solicitor swore that when the proceedings were commenced, he assumed that Ms Jilani had sworn the information necessary to obtain the warrant. He said that until he read Ms Jilani's affidavit he had no idea that she did not swear the information. 34 As a result of Ms Jilani's affidavit the applicants sought to amend [1] of the application to review Ms Jilani's decision"… to apply for a warrant to search premises in relation to offences …". 35 The original claim to review Ms Jilani's decision to swear an information was deleted. 36 We will set out the whole of the amended application, which shows the original terms of the application with deletions crossed out and amendments in bold. 37 The amended application, omitting formal parts is as follows:- "Application to review the following decisions: 1. The decision of the second respondent, Kellie Nadine Jilani, to apply for a warrant to search premises to swear an information that she had reasonable grounds for suspecting that each of the applicants had committed in relation to offences against the laws of the Commonwealth and, in particular, the following alleged offences: (a) That on or about the nineteenth day of July 2001 at Brisbane in the State of Queensland, Michael Perry DEMPSEY and Otto Heinrich WILHELM did, contrary to section 134.2(1) of the Criminal Code (Commonwealth) by a deception dishonestly obtain a financial advantage from the Commissioner of Taxation, a Commonwealth entity, namely a reduction in the quantum of the tax debt owed to the said Commissioner by Markit Pty Ltd, a company of which they were both directors; (b) That on or about the third day of August 2001 at Brisbane in the State of Queensland, Michael Perry DEMPSEY and Otto Heinrich WILHELM did, contrary to section 134.2(1) of the Criminal Code (Commonwealth) by a deception dishonestly obtain a financial advantage from the Commissioner of Taxation, a Commonwealth entity, namely a reduction in the quantum of the tax debt owed to the said Commissioner by Urinda Pty Ltd, a company of which they were both directors; 2. The decision of the first respondent, in his capacity as an issuing officer within the meaning of the Crimes Act 1914 (Cth) (the Crimes Act), to issue a search warrant, on the 7th of July 2004, purportedly authorising the second respondent to search the commercial premises of Blake Dawson Waldron Lawyers, situated at Level 40, Riverside Centre, 123 Eagle Street, Brisbane Q 4000 and to take possession of documents referred to in the first condition of the search warrant. Further, or alternatively to review 3. The conduct engaged in by the Second Respondent, Kellie Nadine Jilani in applying for, and executing a search warrant on the 7th of July 2004 at the offices of Blake Dawson Waldron Lawyers, at Level 40, Riverside Centre, 123 Eagle Street, Brisbane; and 4. In the further alternative, the conduct engaged in by the Second Respondent, Kellie Nadine Jilani, in taking possession of documents seized at the said premises and handing or delivering those said documents to officers employed in the Australian Taxation Office in Brisbane. Alternatively, an application to review the conduct of the second respondent in swearing an information alleging that she had reasonable grounds for suspecting the commission of the aforementioned offences in circumstances where she did not entertain any such suspicion. Alternatively, the application is made pursuant to s 39B of the Judiciary Act 1903. The applicants are aggrieved by the decisions and conduct referred to herein because: 1. The documents seized from the aforementioned premises included documents owned by the applicants, which documents were to be returned by Blake Dawson Waldron to Messrs Clayton Utz, solicitors for the applicants on the 8th of July 2004, pursuant to the terms of a deed of settlement entered into by the applicants and the Commissioner of Taxation, for and on behalf of the Commonwealth of Australia, on the 7th of July 2004. The Applicants cannot, until discovery is completed, provide a complete list of the documents seized but are presently aware that the documents included the following: (a) Minutes of meetings of the directors of Markit Pty Ltd, the third applicant herein, dated the 1st of February 1994, 22nd of February 1994, 14th of November 1994 and 23rd of February 1995; (b) Management agreement between the third applicant, Markit Pty Ltd, and the first and second applicants, Messrs Wilhelm and Dempsey, dated 20th of May 1995; (c) Minutes of meetings of the directors of the fourth applicant herein, Urinda Pty Ltd, dated the 15th of October 1994 and 21st of June 1994 (hereinafter referred to as 'the aforesaid documents'); 2. The applicants are entitled to possession of the aforesaid documents, as the owner thereof, and pursuant to the terms of clause 2(c) of the deed of settlement referred to herein, and to possession of any other of the documents seized of which they, or any of them, are the owners. The grounds of the application are as follows: 1. That procedures that were required by law to be observed in connection with the making of the decisions were not observed: Particulars (a) The information sworn by the second respondent, Ms Jilani, contained allegations which were false and/or misleading in that it was alleged that she had reasonable grounds for suspecting the commission of the offences referred to previously herein when she entertained no such suspicion; (b) The person or persons who swore the information for the purposes of obtaining the said search warrant were not authorised so to do pursuant to s 3E of the Crimes Act. 2. That the making of the decision to swear the information and the decision to issue the search warrant was an improper exercise of the power conferred by the enactment in pursuance of which those decisions were purported to be made: Particulars (a) The second respondent took into account irrelevant considerations in the purported exercise of the power in that the information was sworn by, and the search warrant issued at the request of, officers employed by the Commonwealth of Australia in the office of the Commissioner of Taxation, in Brisbane, for purposes other than the investigation of offences pursuant to the Criminal Code and, in particular, the offences referred to in the search warrant; (aa) Alternatively, the person or persons who swore the information for the purposes of obtaining the said search warrant took into account irrelevant considerations in the purported exercise of the power in that the information was sworn and the search warrant issued at the request of officers employed by the Commonwealth of Australia in the office of the Commissioner of Taxation, in Brisbane, for purposes other than the investigation of offences pursuant to the Criminal Code and, in particular, the offences referred to in the search warrant; (b) The respondents purported to exercise the power contained in s 3E of the Crimes Act for a purpose other than the purpose for which the power was conferred in that the search warrant was obtained at the request of officers employed by the Commonwealth of Australia in the office of the Commissioner of Taxation in Brisbane for purposes other than the investigation of offences to which the search warrant purportedly related; (c) The powers referred to in s 3E of the Crimes Act were purportedly exercised by the respondents at the direction or behest of another person, namely officers employed by the Commonwealth of Australia in the offices of the Commissioner of Taxation at Brisbane; 3. The respondents purported to exercise the power contained in s 3E of the Crimes Act in a way which constitutes an abuse of power; 4. Further, or in the alternative, the purported exercise of power pursuant to s 3E of the Crimes Act by the respondent in the circumstances involved jurisdictional error; Particulars (a) The applicants repeat and rely on the particulars supplied in relation to the preceding grounds. The applicant claims: 1. A declaration that the search warrant purportedly issued by the first respondent on the application of the second respondent, dated the 7th of July 2004, is invalid; 2. A declaration that the second respondent was not entitled to remove from the premises referred to previously herein the aforesaid documents; 3. Further, or in the alternative, an order in the nature of a writ of certiorari quashing the decisions referred to herein with effect from the date when the decisions were made; 4. Alternatively, an order pursuant to s 16(1)(a) of the Administrative Decisions (Judicial Review) Act 1977 (Cth) quashing or setting aside the decisions referred to herein with effect from the date when the decisions were made; 5. An order directing the second respondent to return the documents seized, including the aforesaid documents, to the applicants or their solicitors within seven days from the date of the Court's order; 6. Alternatively, an order directing the second respondent to return the documents seized, including the aforesaid documents, to Blake Dawson Waldron within seven days from the date of the Court's order; 7. An order that the respondents pay the applicants' costs of and incidental to this application to be taxed, if not agreed."

The Judgment of Finkelstein J 38 His Honour noted at [6] that he was required to resolve three interlocutory applications. The first was described as an objection to competency. This was filed by Ms Jilani, asserting that the decision under review was said not to be a decision under an enactment to which the Administrative Decisions (Judicial Review) Act 1977 (Cth) ("the ADJR Act") applies. 39 The second interlocutory application was for leave to amend. His Honour said at [8] that this was opposed by Ms Jilani on the ground that the amendments amounted to no more than unparticularised assertions of misconduct suggesting that the proceeding was speculative and of a fishing nature. 40 The third application was for discovery which was also opposed on the ground that it was an exercise in fishing. 41 His Honour's reasons did not deal fully with the objection to competency. He said at [7] that there were a number of reasons why it "should be put to one side". He observed that the objection seemed to ignore the decision of a Full Court in Salerno v National Crime Authority (1997) 75 FCR 133 but he went on to say that even if the decision and the conduct in question are beyond the reach of the ADJR Act, they do not fall outside the scope of s 39B of the Judiciary Act 1903 (Cth). 42 His Honour dealt with the objection to the amendments in the following passage at [9]:- "What I am about to say in dealing with this submission is not to be taken as a view about the merits of the case: I have no view about the merits. On the other hand, I have formed a very clear view that this is a case that should be allowed to go forward. The starting point is the fact that the ATO had agreed to give back all the documents held by its solicitors (both original and copies). From this may be inferred that at least as at 7 July 2004 the ATO no longer had any need for the applicants' documents. If it needed the documents it would not have agreed for them to be returned. This is not to say that the ATO had never conducted an investigation into whether any of the applicants had committed the offences mentioned in the warrant. It is to suggest that the investigation (if there was one) had come to an end by 7 July with the settlement of the three actions. If this be so the warrant should not have issued because the investigation was over." 43 In the next paragraph of his reasons his Honour raised the possibility of a challenge to the decision on bad faith grounds. The passage appears at [10] as follows:- "There is, I suppose, another possibility. It is that the ATO only agreed to give back the documents to achieve a settlement of the actions but it always intended to arrange for the search warrant to avoid handing over the documents. What effect this would have on the terms of settlement is not a matter that will arise on this application. But, if this is what really happened, it may be the basis of a challenge to the decisions to obtain and issue the warrant on the ground of bad faith or unfairness as suggested in In Re Preston [1985] AC 835. See also Lego Australia Pty Ltd v Paraggio (1994) 52 FCR 542."

44 His Honour then addressed a submission put by senior counsel for the applicants which was said to flow from the allegation in ground 2(c) of the Amended Application that the powers referred to in s 3E of the Crimes Act were exercised by Ms Jilani at the direction or behest of the Commissioner. 45 This ground was said to raise several issues not articulated in the application. His Honour listed them at [4]. They were: first, did the ATO have power to conduct an investigation into the stated offences; second, if the ATO was conducting an investigation, was it entitled to request the AFP to issue a warrant; third, was the AFP permitted to provide to the ATO the documents seized on execution of the warrant; fourth, should any of these matters have been disclosed to Mr McKay as the issuing officer. 46 As to these submissions, his Honour said at [11] that it would be necessary to examine closely the legislation that regulates the conduct of the AFP and the powers of the ATO. His Honour then said at [11]:- "The parties have not undertaken that task. They have not even referred to the relevant legislation which would include, so far as I can tell, the Australian Federal Police Act 1979 (Cth) and the Taxation Administration Act 1974 (Cth). Be that as it may, in the absence of some attempt by the second respondent to demonstrate that it was proper for the AFP to exercise its powers in furtherance of an investigation being conducted by another Commonwealth agency, I am not prepared to infer that this part of the application is 'fishing'." 47 His Honour then turned to the request for discovery. He observed that the applicants sought documents relating to the request for and the issuing and execution of the warrant, the swearing of the information, as well as the record of seizure. 48 In considering the request for discovery, his Honour referred to a number of well-known authorities for the proposition that the Court will not lend its assistance to an exercise in fishing for documents to support a case which is not within the terms of the application. 49 The reasons why his Honour decided to order discovery are to be found in the following passage at [16]:- "In this case the applicants are not 'fishing' in the sense that their claims are not wholly speculative. The facts, at least those which appear to be common ground, do suggest that by the time the warrant was issued the documents were no longer required by ATO. An alternative is that the ATO embarked upon a course of trickery to settle the proceedings and keep their hands on the documents. This is the stuff of judicial review applications. So also are the questions of power: Does the ATO have power to conduct an investigation into the alleged offences? Is the AFP entitled to assist in that investigation by obtaining a search warrant and then handing over the documents obtained from its execution? These matters will be addressed at trial. To get the matter ready for trial the applicants are entitled to an order for discovery of the documents they seek. If there is to be any claim for immunity from production that can be taken in the usual way." 50 The documents which were the subject of the discovery order fell into two categories: first, documents relating to requests from the ATO for the issue of the search warrant; second, documents relating to the swearing of the information.

The Legislation 51 The following provisions of the Crimes Act are relevant:- "3E(1) An issuing officer may issue a warrant to search premises if the officer is satisfied by information on oath that there are reasonable grounds for suspecting that there is, or there will be within the next 72 hours, any evidential material at the premises. … (5) If an issuing officer issues a warrant, the officer is to state in the warrant: (a) the offence to which the warrant relates; and (b) a description of the premises to which the warrant relates or the name or description of the person to whom it relates; and (c) the kinds of evidential material that are to be searched for under the warrant; and (d) the name of the constable who, unless he or she inserts the name of another constable in the warrant, is to be responsible for executing the warrant; and (e) the time at which the warrant expires (see subsection (5A)); and (f) whether the warrant may be executed at any time or only during particular hours. … 3F(1) A warrant that is in force in relation to premises authorises the executing officer or a constable assisting: (a) to enter the warrant premises and, if the premises are a conveyance, to enter the conveyance, wherever it is; and

... (c) to search the premises for the kinds of evidential material specified in the warrant, and to seize things of that kind found at the premises; and (d) to seize other things found at the premises in the course of the search that the executing officer or a constable assisting believes on reasonable grounds to be: (i) evidential material in relation to an offence to which the warrant relates; or (ii) evidential material in relation to another offence that is an indictable offence; or (iii) evidential material (within the meaning of the Proceeds of Crime Act (2002) or tainted property (within the meaning of that Act);

if the executing officer or a constable assisting believes on reasonable grounds that seizure of the things is necessary to prevent their concealment, loss or destruction or their use in committing an offence; and (e) to seize other things found at the premises in the course of the search that the executing officer or a constable assisting believes on reasonable grounds to be seizable items; and (f) if the warrant so allows - to conduct an ordinary search or a frisk search of a person at or near the premises if the executing officer or a constable assisting suspects on reasonable grounds that the person has any evidential material or seizable items in his or her possession. … (5) If things are seized under a warrant, the warrant authorises the executing officer to make the things available to officers of other agencies if it is necessary to do so for the purpose of investigating or prosecuting an offence to which the things relate."

Preliminary observations: Construction of statutory powers of search and seizure 52 In Harts Australia Limited v Australian Federal Police (1997) 75 FCR 145, a Full Court (Hill, Cooper and Whitlam JJ) observed at 147 that Part 1AA of the Crimes Act, in which ss 3E and 3F are to be found, was introduced by amending legislation that commenced in November 1994. It replaced the provisions of s 10(1) which governed the issue of search warrants prior to the commencement of the 1994 amendments. 53 Their Honours said, at 150, that Part 1AA is to be construed in its statutory context including the multitude of authorities on the earlier provisions which it replaced except insofar as Part 1AA negates the applicability of the pre-existing law. Regard may be had to George v Rockett and to the many authorities discussing the earlier provision of s 10(1). 54 One of the authorities to which their Honours referred at 150 as having continuing application was Beneficial Finance Corporation Limited v Commissioner of Australian Federal Police (1991) 31 FCR 523 ("Beneficial Finance"), to which we will refer later. 55 In Hart v Commissioner of Australian Federal Police (2002) 124 FCR 384, another Full Court (French, Sackville and R D Nicholson JJ) also considered the principles which apply to the construction of Part 1AA. 56 Their Honours said at [64] that the construction of statutes authorising the search of premises and seizure of things begins with the ordinary meaning of the words considered according to their context and legislative purpose. They said at [65] that the purpose of search and seizure provisions is to provide for the gathering of information to determine whether offences have been committed and to facilitate proof of them. 57 French, Sackville and R D Nicholson JJ went on to say at [68] that effect must be given to the importance attached by the legislature to the use of search warrants as an important and legitimate tool in the detection and prosecution of offences. Statutes are not to be construed narrowly but consistently with the operational reality applicable to the issue and execution of warrants. 58 Their Honours concluded at [68] as follows:- "In particular, there is no requirement that the Court approach that task armed with a prima facie hostility to the invasion of privacy that is necessarily involved in the exercise of investigative powers. Privacy is but one of the interests to be taken into account in construing legislation authorising the exercise of such power."

Further Preliminary Observations - no attempt to obtain documents to determine sufficiency of belief 59 In Beneficial Finance, Burchett J referred at 550-551 to authorities on the question of whether, in challenging the sufficiency of the evidence upon which a search warrant had issued, an applicant should be permitted to examine material before the issuing officer to see if he or she "could find a foothold for an argument against its sufficiency". 60 The true rule appears to be that if an issue is raised, that is to say properly put forward in an application, as to the sufficiency of the information on oath placed before the issuing officer, the applicant will be permitted to have access to it, subject to any proper claim for public interest immunity. 61 Senior counsel for the respondents eschewed any generalised claim for production based on the sufficiency of the material before the issuing officer. He noted that Ms Jilani had indicated that public interest immunity would be claimed if that course were followed. 62 Whether a claim for public interest immunity from production will be taken in the event that Finkelstein J's discovery orders are upheld is not entirely clear. However, no such issue arises on the appeal.

Ground 1(b) of the amended application 63 This paragraph of the amended application states that the person who swore the information was not authorised to do so pursuant to s 3E of the Crimes Act. The learned primary judge did not deal with it directly in his reasons for judgment. He may have been of the view that the ground could be supported by his observation that the warrant should not have issued because the investigation was "over". 64 Mr Derrington attacked the sufficiency of this ground on two bases. The first was that it turns upon an unsustainable construction of s 3E of the Crimes Act. The second was that the applicants have not particularised the allegation and they are unable to do so. Finkelstein J did not deal with these objections although they were raised at first instance. 65 The applicants' inability to particularise the allegation is serious. Insofar as ground 1(b) asserts that the actual person who swore the information was not authorised, it points to the speculative nature of allegation. It is not perhaps so serious a deficiency as that which appeared in ground 1 as originally formulated. That ground alleged that Ms Jilani swore the information without reasonable grounds for suspecting the commission of the offence. The applicants would appear to have had no basis for making that allegation and it has now been deleted. 66 Notwithstanding the difficulty flowing from the absence of particulars, it seems to us that the question of whether or not leave to amend should have been granted turns upon issues of construction of s 3E. This is because the gravamen of the applicants' allegation is apparently that, whoever swore the information, that person was not authorised for two reasons. The first is that the information was not sworn by Ms Jilani as a member of the AFP. The second is that the ATO's investigation was "over" and it therefore had no authority or power to request the AFP to issue a warrant. 67 The question which arises before us is whether the amendment disclosed a ground that was fairly arguable; see State of Queensland v JL Holdings Pty Limited (1996) 189 CLR 146. The learned primary judge, although not addressing the ground directly, was apparently of the opinion that it did. This was an exercise of his discretion on a matter of practice and procedure with which we cannot lightly interfere; Minogue v Williams (2000) 60 ALD 366 at [18] - [19]; Australian Coal and Shale Employees Federation v Commonwealth (1953) 94 CLR 621 at 627. 68 We would only interfere with his Honour's discretion if we are satisfied that the ground is hopeless and that the primary judge was clearly wrong in allowing the amendment; General Steel Industries Inc v Commissioner of Railways (NSW) (1964) 112 CLR 125. 69 The principles of construction to which we referred at [52] - [58] strongly suggest that there is no requirement in s 3E of the Crimes Act that a member of the AFP must swear the information in support of the request for a warrant. 70 In Williams v Keelty (2000) 111 FCR 175 ("Williams v Keelty") at [128], Hely J observed that the Crimes Act does not contain any express provision with respect to who may apply for a warrant. He pointed out that it is clear from s 3E(4) that the person applying will not necessarily be a member of the AFP. Implicit in this is the proposition that where the AFP is the applicant, the information may be sworn by a third party. 71 This approach is supported by the overriding consideration that it is the issuing officer who must be satisfied that there are reasonable grounds for suspecting the relevant matters. It must appear to the issuing officer that there are reasonable grounds, not to the person who seeks the issue of the warrant; George v Rockett at 112; Williams v Keelty at [166] - [167]. 72 In our opinion, any suggestion that upon the proper construction of s 3E of the Crimes Act, Ms Jilani, as the person seeking the issue of the warrant, was required to swear the information cannot be sustained. 73 It follows in our view that ground 1(b) should not be allowed to stand unless it can fairly be argued that the ATO's authority to swear an information in support of the search warrant was exhausted by the execution of the Deed of Settlement. This turns upon the inference that the primary judge was prepared to draw from the applicants' entitlement to collect the documents in accordance with clause 2(c). 74 Plainly, his Honour's observations were made on an interlocutory basis. But for such an inference to be drawn at a final hearing there would need to be facts or circumstances raising a probable inference in favour of the allegation; J D Heydon, Cross on Evidence (7th ed) at [9055] and the authorities there cited. 75 With due respect to the primary judge, we do not see how anything in the Deed of Settlement could give rise to an inference that the investigation had come to an end. Even if that be wrong, we do not see how it could be inferred that the terms of the Deed of Settlement suggested that it was not open to the Commissioner to resume or continue the investigation thus far made. There was nothing in the Deed of Settlement capable of supporting an allegation that the investigation had been irrevocably terminated. 76 It seems to us to be plain that the Deed of Settlement compromised the civil claims for recovery of the unpaid tax instalments. There was not, nor could there be, any suggestion that the payment of $600,000 for the compromise of the civil claims released Mr Dempsey and Mr Williams from the possibility of criminal prosecution; R v Rogerson (1992) 174 CLR 268 at 275-276. Yet the suggestion in ground 1(b), albeit not expressly made, that the payment of the settlement sum and the entitlement to collect the documents, brought to an end the possibility of an investigation into the possible criminal consequences of the applicants' conduct is an essential premise underlying the allegation. In our view, it is unsupportable and should not have been allowed to stand.

Ground 2(aa) of the Amended Application 77 Ground 2(aa) is an allegation of improper purpose. The applicants' contention is that the unidentified person who swore the information, and the persons who requested the issue of the warrant, did so for purposes other than the investigation of offences under the Criminal Code. 78 The difficulty with this allegation is that the applicants are unable to state what they contend to be the improper purpose of the relevant persons. 79 Mr Hack SC, for the applicants, frankly conceded before us in argument that he is not in a position to say what the improper purpose is. Nevertheless, he asserted that there is a statutory purpose for which the power may be used and that it is arguable that it was not used for that purpose. In putting the submission he conceded that he could not say what particular purpose was in the mind of the person who requested the assistance of the AFP. 80 But as was also conceded by Mr Hack, the logic which underlies the unparticularised allegation of improper purpose is the inference that was said to flow from the Deed of Settlement, namely that the ATO did not intend to further investigate the alleged commission of criminal offences. We have said above at [75] - [76] that in our view the inference is not open. 81 It follows that in our opinion the discretion to permit the amendment to raise ground 2(aa) miscarried. In our view this conclusion flows not merely because of the inability of the applicants to particularise the allegation and state the purpose but as a result of the rejection of the logic which underlies the amendment. 82 We would add that in any event, the lack of particulars and the applicants' inability to state the alleged purpose is a sufficient objection to the grant of leave to amend. In Murchison v Keating (1984) 1 FCR 341 ("Murchison v Keating") at 344-345, Toohey J referred to the need to provide some particularity of an assertion of the grounds put forward for review under the ADJR Act. His Honour cited the Full Court authority of Lamb v Moss (1983) 49 ALR 533 in which it was said at 564 that the Court must be able to see that the real basis of complaint is identified and seen to be at least arguable. 83 Toohey J also pointed at 344-345 to the inevitable result of fishing expeditions if bare allegations of the grounds stated in the ADJR Act are permitted. He said that the applicants' response to the request for particulars sought would enable the Court:- "… to assess whether the application is one of substance or whether the applicant has simply resorted to the grounds in s 5(1) [of the AD(JR) Act] without having any arguable matter of complaint but hoping to find one through interlocutory steps." 84 A similar approach was adopted by Derrington J in an application under the parallel provisions of the Judicial Review Act 1991 (Qld); see Knuth v Minister for Resource Industries [1993] 2 Qd R 263 at 265. 85 In Williams v Keelty, Hely J observed at [228] that a warrant issued for the collateral purpose of obtaining information to be used in legal proceedings other than the criminal proceedings contemplated in the warrant would be invalid. No such allegation is made here. His Honour's observations at [235] - [236] about the onus undertaken by an applicant who wishes to challenge the issue of a warrant on administrative law grounds also supports the need for an applicant to provide, and particularise, an allegation of improper purpose. 86 It is true as Hely J pointed out at [248] that improper purpose may be established by inference. It will therefore be a question of fact. However, the authorities to which we have referred demonstrate that, to go to trial, there must be something in the application from which the Court can see that there is a real basis for complaint. 87 Where improper purpose is alleged, it will usually be necessary to state that purpose. However in some circumstances it may be sufficient to allege that demonstrated absence of a proper purpose leads to the inference of an improper purpose. That was the approach adopted by the applicants in this case. In effect they asserted that the only possible proper purpose (conduct of an investigation) was excluded by the available inference that the investigation had been completed. However we have concluded that that such inference was not available. Thus it is not possible to exclude proper purpose. 88 The observations of Finn J in Randwick City Council v Minister for the Environment (1998) 54 ALD 682; affirmed (1999) 167 ALR 115, point to the dangers of allowing deficient allegations of improper purpose to go to trial. There, the matter went to a final hearing. His Honour said at 715 that the statement of reasons under s 13 of the ADJR Act did not "betray even a suggestion that [the Minister] had in mind any of the purposes" set out in the pleading. The position must be a fortiori where no statement of purpose is set out in the application and where senior counsel has fairly and properly conceded that he cannot state the purpose.

Whether the amended application raises issues of want of power 89 We stated at [45] the issues which the primary judge considered to fall within the application, although not expressly stated. We will not repeat them but will deal with them seriatim. 90 We understand the allegation that the ATO did not have power to conduct an investigation to turn upon the proposition that the power was spent by reason of the terms of the Deed of Settlement. We have already dealt with this. 91 The primary judge appears to have considered that the issue of the ATO's power to conduct the investigation would turn upon issues of construction of the Australian Federal Police Act 1979 (Cth) ("the AFP Act") and the Taxation Administration Act 1954 (Cth) ("the Taxation Administration Act") which were not addressed by the parties in their submissions at first instance. His Honour was critical of the parties, and in particular of Ms Jilani's legal advisers for not undertaking that task. His Honour considered that this warranted the matter going to final hearing; see the passage set out at [46] above. 92 However, the difficulty which is apparent in this approach is that it is implicit in the terms of amended ground 2(aa), and indeed in the original ground 2(a), that the ATO did have power to investigate offences under the Criminal Code. What is stated in those grounds is that the power was exercised for a purpose other than that for which the power, namely investigation of the offences, existed. 93 We do not see how, in those circumstances, Ms Jilani's legal advisers can be criticised for failing to address the point at first instance. 94 There was much debate before us as to the scope of the Commissioner's powers under the Taxation Administration Act. The proper construction of those powers, as well as the powers of the AFP under the AFP Act were said to raise issues to go to trial as to whether the ATO had power to conduct an investigation and whether it was entitled to obtain the assistance of the AFP to issue the warrant. It was also said that the legislation precluded the AFP from providing to the ATO the documents seized on execution of the warrant. 95 The short answer to these contentions, which his Honour considered to raise triable issues, is that they are not expressly stated in the terms of the original, or the amended, application. We do not see that they fall for consideration on the question of leave to amend. 96 Nor in our view could they raise issues on which discovery is necessary because they turn purely upon questions of construction of the applicable legislation. 97 As to his Honour's view that the various questions of power ought to have been disclosed to the issuing officer, this is sufficiently covered by what we have said. That is to say, it does not fall for consideration of the question of the amendment. We pause to add, that whether there is a duty of disclosure is a question of statutory construction and the principles which apply to the grant of ex parte relief in Courts of Equity have no application; see Williams v Keelty at [238]; see also Lego Australia Pty Limited v Paraggio (1994) 52 FCR 542 ("Lego") and McDonald v Malayta; Ex Parte Malayta [1998] 1 QdR 252 per Dowsett J, Pincus JA concurring.

Bad Faith 98 In the passage which we have set out at [43] the primary judge expressed the view that it may be open to the applicants to challenge the warrant on the ground of bad faith or unfairness. 99 As Beaumont and Whitlam JJ said in Lego at 555, in exceptional cases an administrative decision may be vitiated for fraud or misrepresentation; see also per Hill J at 570. 100 But the short answer to his Honour's suggestion is that it is well established that allegations of fraud must be made specifically; see Banque Commerciale SA en Liquidation v Akhil Holdings Limited (1990) 169 CLR 279 at 285. In the absence of any allegation in the application of want of good faith, we do not see how the matter could proceed to trial on that issue. 101 In any event, it is one thing to assert trickery or misrepresentation in relation to the execution of the Deed of Settlement. It is quite another to suggest that the exercise of the power to seek the issue of a search warrant in aid of the power to investigate possible criminal offences is similarly tainted.

Review of Conduct 102 In [3] and [4] of the amended application the applicants seek to review the "conduct" of Ms Jilani in applying for and executing the warrant and in handing the documents to officers of the ATO. 103 Section 6 of the ADJR Act provides that where a person has engaged in conduct for the purpose of making a decision to which the ADJR Act applies, a person aggrieved may apply for an order of review of the conduct on one or more of the stated grounds. 104 Mr Derrington attacked the whole of the application to invoke the ADJR Act on the ground that the decisions which are the subject of the application are not decisions to which the ADJR Act applies. He also submitted that the "conduct" sought to be attacked in [3] and [4] is not conduct engaged in for the purpose of making a decision to which the ADJR Act applies. 105 In Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 ("Bond") at 341-343, Mason CJ said that the ADJR Act draws a clear distinction between a "decision" and "conduct" engaged in for the purpose of making a decision. The conduct which is the subject of s 6 is essentially procedural. The complaint is that the process of decision making is flawed, whereas in relation to a decision, the complaint is that the actual decision was erroneous. 106 Although [1] of the grounds of review purports to attack the procedures connected with the making of the decision to request the warrant, the gravamen of the complaints made in the application is about the decision itself. To the extent that other conduct may be involved, such as the delivery of the documents by the AFP to the ATO, we do not see that this is conduct for the purpose of making a decision within s 6 of the ADJR Act. 107 The primary judge's reasons do not address the amendment to add the claims to review Ms Jilani's conduct. It seems to us, for the reasons set out above, that the paragraphs in which those claims are made do not address the distinction between conduct of decisions to which Mason CJ referred in Bond. Accordingly, in our view leave to amend to add those paragraphs should not have been granted.

Discovery 108 The principles upon which discovery is ordered in judicial review applications were summarised by Merkel J in Carmody v McKellar (1996) 68 FCR 265 at 280:- "The following principles may now be taken to be well established by the decisions of the Court in Melbourne Home of Ford v Trade Practices Commission (1979) 36 FLR 450, W.A. Pines Pty Ltd v Bannerman (1980) 41 FLR 175 and Australian Securities Commission v Somerville (1994) 51 FCR 38. . the Court has a discretionary power to order discovery in proceedings for the review of an administrative decision; . the proper exercise of the power depends upon the nature of the case and the stage of the proceedings at which discovery is sought; . if a proceeding or claims in it are essentially speculative in nature the Court will not order discovery in order to assist the applicant in a fishing exercise; . the evidence or material which will be required to establish that the proceeding or particular claims in it are not essentially speculative will vary with the nature and circumstances of the particular case; . if there is not the slightest evidence or there is no other material to support the bare allegations made in the proceeding, then as a general rule, an order for discovery ought not to be made." 109 It is true as his Honour said at 280 that the issue of a search warrant is an in camera exercise of executive power which should not be immunised from review by the imposition of unrealistic criteria for discovery. But these observations must be read in light of the last bullet point in the summary of principles. The answer to the conundrum raised by Merkel J about the undesirability of secrecy is, as he said at 281, that the threshold may be lower in such cases but there must be some evidence or proper basis for suggesting that the warrant might have been issued unlawfully. 110 The principle against allowing discovery for the purpose of "fishing" was also referred to by Wilcox J in Nestle Australia Limited v Commissioner of Taxation (1986) 10 FCR 78 ("Nestle") at 82. 111 Wilcox J went on, at 83, to refer to the decisions in WA Pines and Lloyd v Costigan (1983) 62 ALR 284. The effect of those authorities is that it is not open to an applicant to make a bare allegation that a decision was made without any basis and then use the process of discovery to find out if the allegation has foundation. 112 There must be sufficient definition of the issues to enable the Court to see that the documents sought on discovery relate to a live issue; there must at least be something from which the Court can see that there is a real issue the proof of which would be assisted by discovery; Nestle at 83; Murchison v Keating at 344-345. 113 It follows from what we have said about the application for leave to amend that we do not agree with the primary judge's finding that the applicants are not fishing. In our view, the applicants have made bare allegations without the necessary basis to support them. It is plain to us that they hope to find something on discovery which will enable them to support the existing allegations, or perhaps to raise new ones. 114 We do not agree with his Honour's observation in the passage we have set out at [49] that it is common ground that the documents were no longer required by the ATO. It may well have been a breach of the implied undertaking on the part of the Commissioner in the Markitproceedings, the Urinda proceedings or the District Court proceedings to have used the documents obtained in those proceedings for the purpose of initiating criminal proceedings. Certainly it was not common ground that the ATO did not require the documents; it initiated steps to obtain them by warrant shortly before 7 July 2004. 115 His Honour also said that one possibility was that the ATO had embarked upon a course of trickery and that the applicants were entitled to discovery for that purpose. We have set out at [100] our views about this suggestion. It is unnecessary to repeat them. 116 Even if, as his Honour said, there are questions of whether the ATO had power to conduct an investigation or whether the AFP had power to hand over the documents, these issues can do no more than raise questions of statutory construction. Discovery would not assist in the resolution of those issues. 117 It follows in our view that his Honour's discretion miscarried in ordering discovery.

Objection to Competency 118 Mr Derrington submitted that whether or not the decision to apply for a warrant had the necessary quality of finality, it was not a decision under an enactment within s 3(1) of the ADJR Act because it failed to satisfy the two-fold requirements stated by the High Court in Griffith University v Tang (2005) 79 ALJR 627 at [89]. 119 The two criteria are: first, that the decision must be expressly or impliedly required or authorised by the enactment and, second, that the decision must itself confer, alter or otherwise affect legal rights. 120 However, Mr Derrington stated that if we should find in his favour on the question of the amendments, he would not ask us to consider the objection to competency. 121 Accordingly, it is unnecessary for us to determine this issue.

Conclusion and Orders 122 The orders we will make are as follows:-

1. The appeal is allowed.
2. Orders 1, 2 and 4 made by Finkelstein J on 23 June 2005 be set aside.
3. The applicants in the proceedings pay the costs of the motion and of the appeal.

I certify that the preceding one hundred and twenty-two (122) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Dowsett, Jacobson and Greenwood.

Dated: 20 December 2005 Counsel for the Appellant: Mr R Derrington SC

Solicitor for the Appellant: Australian Government Solicitor

Counsel for the Respondents: Mr P Hack SC with Mr P Bickford