Kelsey v Logan City Council & Ors

Australian Securities and Investments Commission v Managed Investments Limited & Ors (No 5) [2013] QSC 313

Australian Securities Commission v Cavanagh (1993) 12 ACSR 69

Commissioner of the Australian Federal Police v Zhao (2015) 225 CLR 46; [2015] HCA 5

Construction, Forestry, Mining and Energy Union v Australian Competition and Consumer Commission [2016] FCAFC 97; (2016) 242 FCR 153

Gypsy Fire v Truth Newspapers Pty Ltd (1987) 9 NSWLR 382

McLachlan v Browne (No 9) [2019] NSWSC 10

McMahon v Gould (1982) 7 ACLR 202

Osric Investments Pty Ltd v Probst and Anor [2007] QSC 293

R v Ferguson; Ex parte Attorney-General (Qld) (2008) 186 A Crim R 483

Re AWB Ltd (No 1) [2008] VSC 473; (2008) 21 VR 252

State of Queensland v Bush [2003] QSC 375

White v Australian Securities and Investments Commission & Ors (2013) 237 A Crim R 83; [2013] QCA 357

Mr C Murdoch QC with Ms H Stephanos of Counsel instructed by Minter Ellison Lawyers for the Applicant.

Mr A Herbert of Counsel, instructed by King & Company Solicitors for the First Respondent.

Mr J Hunter QC with Mr M Trim instructed by Gadens Lawyers for the Second Respondent.

Mr W Friend QC with Mr C Massy of Counsel, instructed by McInnes Wilson Lawyers for the Third to Ninth Respondents.

[1] The Second to Ninth Respondents seek a stay of the current proceedings before the Commission until the hearing and determination of criminal charges against both the Second Respondent and each of the Third to Ninth Respondents.

[2] The Second Respondent contends that the stay of the existing proceedings should be granted because:

(a) If a stay is granted in relation to the proceedings against the Third to the Ninth Respondents (and it should be) then there is no additional prejudice arising from the stay of the proceedings against him and the proceedings cannot and should not sensibly continue in those circumstances anyway;

(b) There is a significant risk that the publicity which will attend upon any further developments in this matter, including any oral closing submissions and any decision, could fundamentally prejudice his ability to obtain a fair trial in criminal proceedings; and

(c) It is in the interests of justice that the proceedings against the second Respondent be stayed given that the risk: the penalties for the alleged offences are grave and there is no or limited material prejudice to the Applicant caused by any stay on the evidence, including because the Applicant's failure to seek any alternative employment until February 2019.

[3] The Third to Ninth Respondents seek a stay of this proceeding, pending the hearing and determination of the criminal charge on the basis that:

(a) In making submissions about this matter the Third to Ninth Respondents may:

(i) Make concessions, based on forensic choices given the standard of proof, which would not be conceded in any criminal proceedings;

(ii) Inadvertently make concessions which are relevant to the criminal trial; and

(b) the likely publicity associated with any judgment in this matter will prejudice the fair trial of the criminal charges.

[4] The First Respondent's position was expressed in the letter of King & Company to Minter Ellison dated 28 May 2019. The position of the Interim Administrator of the Logan City Council is expressed as follows:

The Interim Administrator acknowledges that is not in the best interests of the Logan City Council for the QIRC proceedings to be delayed. However, the success or failure of the Council's defence of the QIRC proceedings is dependent upon all parties to the proceedings being in a position to fully and freely participate in them.[1]

[5] Ms Kelsey resists the application for a stay of proceedings as the interests of justice do not warrant a stay of the proceedings.

[6] Mr Murdoch QC has referred to the prejudice to Ms Kelsey if the current proceedings before the Commission were to be stayed. In this respect he identified the following three considerations:

(a) The proceeding is so far advanced that there is limited, if any, risk of prejudice arising from any loss of the so called "right to silence";

(b) The proceeding has already been subject to significant publicity and the risk of any prejudice from further publicity is limited in the circumstances of the proceeding; and

(c) The criminal proceedings are "embryonic" and there will be a significant period of time between the conclusion of the proceedings and the hearing of the criminal proceedings, which further reduces the risk of prejudice from any publicity but increases the risks of prejudice to Ms Kelsey.

[7] Ms Kelsey was appointed as CEO of Logan City Council on 2 June 2017. Ms Kelsey's contract of employment contained a six-month probation period during which her employment could be ended on two weeks' notice. The contract had a nominal expiry date of 25 June 2021.

[8] On 10 October 2017, Ms Dalley, Ms Schwarz and Mr Smith, conducted a performance review meeting with Ms Kelsey. During this meeting, the Councillors present told Ms Kelsey that there were concerns with her performance.

[9] On 12 October 2017 Ms Kelsey made a Public Interest Disclosure (PID) to the Logan Council, Minister for Local Government, and to the Crime and Corruption Commission (CCC) alleging possible misconduct on behalf of Mr Smith.

[10] After the PID was made the Councillors received legal advice that they could not take the PID into account when considering Ms Kelsey's employment.

[11] On 1 December 2017, Ms Kelsey (the Applicant) commenced proceedings against the Council (First Respondent) and Mr Smith (Second Respondent), alleging contraventions of s 285 of the Industrial Relations Act 2016 (Qld) (IR Act) and s 48 of the Public Interests Disclosure Act 2010 (Qld) (PID/2017/3).

[12] On 1 February 2018 the Applicant was successful in obtaining injunctive orders from the Commission that the Second Respondent is prohibited in taking part in any resolution by the Council in respect of the Applicant's employment.[2]

[13] On 5 February 2018 the CCC wrote to each of the Councillors informing them of the penalties involved in taking action against a person because they had made a PID and advising that they would be investigating any action taken in respect of the Applicant's employment.

[14] On 6 February 2018 the Applicant's solicitors wrote to the First Respondent asserting that if a Councillor voted for her termination then they would have to individually justify the reason for that decision.

[15] On 7 February 2018 the Applicant's employment at the Logan City Council was terminated as a consequence of a vote of the Council. Councillors Dalley, Lutton, Swenson, Smith, Pidgeon, Schwarz, and Breene all voted in favour of the termination of her employment. Her employment was brought to an end by the giving of two weeks' notice.

[16] The Applicant subsequently amended her application to include the named Councillors as Respondents.

[17] On 17 December 2018 the substantive hearing commenced and the evidence was heard over 15 days concluding on 15 February 2019. The parties were due to give their closing submissions on 2 and 3 May 2019.

[18] On Friday 26th April 2019 the Second to the Ninth Respondents were each arrested by officers of the CCC and charged with fraud under s 408C of the Criminal Code 1899, on the basis that they dishonestly caused a detriment to Ms Kelsey by terminating her employment.

[19] It is not in contention that the principles, as expounded by Wootten J in McMahon v Gould ought to be applied:

I approach the decision of this matter with the following guidelines:

(a) Prima facie a plaintiff is entitled to have his action tried in the ordinary course of the procedure and business of the court;

(b) It is a grave matter to interfere with this entitlement by a stay of proceedings, which requires justification on proper grounds;

(c) 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;

(d) Neither an accused nor the Crown are entitled as of right to have a civil proceeding stayed because of a pending or possible criminal proceeding;

(e) The court's task is one of 'the balancing of justice between the parties', taking account of all relevant factors;

(f) Each case must be judged on its own merits, and it would be wrong and undesirable to attempt to define in the abstract what are the relevant factors;

(g) One factor to take into account where there are pending or possible criminal proceedings is what is sometimes referred to as the accused's 'right of silence', and the reasons why that right, under the law as it stands, is a right of a defendant in a criminal proceeding. I return to this subject below;

(h) However, the so-called 'right of silence' does not extend to give such a defendant as a matter of right the same protection in contemporaneous civil proceedings. The plaintiff in a civil action is not debarred from pursuing action in accordance with the normal rules merely because to do so would, or might, result in the defendant, if he wished to defend the action, having to disclose, in resisting an application for summary judgment, in the pleading of his defence, or by way of discovery or otherwise, what his defence is likely to be in the criminal proceeding;

(i) The court should consider whether there is a real and not merely notional danger of injustice in the criminal proceedings;

(j) In this regard factors which may be relevant include:

(i) the possibility of publicity that might reach and influence jurors in the civil proceedings;

(iii) the possibility of miscarriage of justice e.g. by disclosure of a defence enabling the fabrication of evidence by prosecution witnesses, or interference with defence witnesses;

(iv) the burden on the defendant of preparing for both sets of proceedings concurrently;

(v) whether the defendant has already disclosed his defence to the allegations;

(vi) the conduct of the defendant, including his own prior invocation of civil process when it suited him;

(k) The effect on the plaintiff must also be considered and weighed against the effect on the defendant. In this connection I suggest below that it may be relevant to consider the nature of the defendant's obligation to the plaintiff;

(l) In an appropriate case the proceedings may be allowed to proceed to a certain stage, e.g., setting down for trial, and then stayed.[3]

[20] Robson J in Re AWB Ltd (No 1)[4] suggested that the principles identified in McMahon v Gould should be revisited. However, Daubney J in Osric Investments Pty Ltd v Probst and Anor thought that the principles identified by Wooten J provide a useful guide to the exercise of the discretion on a stay application. His Honour wrote:

The utility of this catalogue of considerations has been recognised on numerous occasions by courts at first instance and on appeal. Although there have been a number of observations by appellate judges to the effect that these guidelines may need to be revisited to give a proper reflection on contemporary public interest, unless and until a revision of these guidelines is undertaken by an appellate court it is appropriate for me to adopt them as applicable to the present case.[5]

[21] The principles expressed in McMahon v Gould were considered and applied by the Queensland Court of Appeal in White v Australian Securities and Investments Commission, where Muir JA emphasised that an applicant has no absolute right to a stay of a civil proceedings.[6]

[22] There is a statutory power for the Commission to stay, by order, any proceedings before the Commission.[7] It is not in contention that the Commission has the power to control its own proceedings. This power extends to circumstances where the interests of justice require the granting of a stay.[8]

[23] The starting point in this application is the consideration of Wootten J's catalogue of considerations used to determine whether they impact, to any significant degree, on the current proceedings in the Commission.

[24] It is accepted that Ms Kelsey has a prima facie entitlement to have her action tried within the ordinary course of the business of the Commission. It follows that it is a serious matter to interfere with that entitlement. The granting of a stay requires justification on proper grounds. The onus is on the Second to Ninth Respondents to demonstrate that it is just and convenient that Ms Kelsey's ordinary rights should be interfered with. As stated by Hayne J in Australian Securities Commission v Cavanagh:

In my view it is therefore clear that unless reason is shown to the contrary, a plaintiff is entitled to have its action tried in the ordinary course of the procedure and business of the court and that it is a grave matter to interfere with that entitlement by a stay of proceedings, the grant of which would require justification on proper grounds. In the end the task is one of the balancing of justice between the parties taking account of all relevant factors and adjudging the case on its own merits.[9]

[25] In short, the Second to Ninth Respondents contend that they should not be required to make submissions on the basis that they may inadvertently make a concession which may be relied upon by the prosecution. The second contention is that if the Commission was to make a determination adverse to the Second to the Ninth Respondents in these proceedings it would result in significant publicity of a nature that has an inherent ability to cause extreme prejudice to the jury in the criminal proceedings.

[26] The principle guidelines which emerge from the submissions of the Second to Ninth Respondents as supporting the granting of the stay are contained in paragraphs (g) and (i) of Wootten J's list of factors: namely, the Respondents "right to silence"and the dangers of injustice in the criminal proceedings through the publicity arising out of the proceedings in the Commission.

[27] Mr Friend QC submits that the Third to Ninth Respondents should not be required to make submissions in the substantive proceedings. It is contended that in large civil proceedings, litigants, for forensic reasons choose to make concessions in their submissions. Such concession would not, it is submitted, be made in criminal proceedings. If the concessions will adversely impact upon the criminal proceedings then the concession cannot be made. Mr Friend QC argues that the Third to Ninth Respondents should not be put in a position whereby they need to choose between conducting their defence of the proceedings in the Commission and the defence of the criminal proceedings.

[28] The Third to Ninth Respondents rely on the decision in Commissioner of the Australian Federal Police v Zhao where the High Court wrote:

The risk of prejudice to the second respondent if a stay is not granted in the forfeiture proceedings and the exclusion proceedings is plain. It is not necessary for the second respondent to say any more than he did on the application for a stay in order to identify that risk, given that the offences and the circumstances relevant to both proceedings are substantially identical.

The prospect that civil proceedings may prejudice a criminal trial and that such prejudice may require a stay of the civil proceedings is hardly novel. In some jurisdictions, procedures are provided for making an application for a stay in such circumstances. The risk of prejudice in a case such as this is real. The second Respondent can point to a risk of prejudice; the Commissioner cannot.[10]

[29] Unlike Zhao both parties in this matter can point to a risk of prejudice_._ In Construction, Forestry, Mining and Energy Union v Australian Competition and Consumer Commission the Full Court of the Federal Court examined the reasoning of the Victorian Court of Appeal and the High Court in Zhao and distilled the following elements from the decision:

1. We turn, then, to the reasoning in Zhao to extract the following principles of relevance to the issues here raised:

(i) where both civil and criminal proceedings are pending, a stay of the civil proceeding will be ordered where "the interests of justice require such an order": Zhao (HC) at [36];

(ii) a court will not grant a stay of a civil proceeding merely because related charges have been brought against an accused and criminal proceedings are pending: Zhao (HC) at [35];

(iii) to warrant a stay of the civil proceeding, "it must be apparent"that the accused "is at risk of prejudice in the conduct of his or her defence in the criminal trial": Zhao (HC) at [35];

(iv) the risk of prejudice must be real and, in considering what the interests of justice require, that risk is to be weighed against the prejudice that a stay of the civil proceeding would occasion: Zhao (HC) at [47] and [50].

1. The reasoning of both the High Court and the Court of Appeal in Zhao recognised that a potential prejudice for an accused is that evidence given by that person in a civil proceeding would reveal or telegraph information to the prosecutor about the accused's defence in the criminal proceeding. The potential to advantage the prosecutor was regarded by the Court of Appeal as an infringement of the privilege against self-incrimination and the right to silence. The High Court relied upon a different but related foundation. As the Court noted at [18], by reference to the fundamental principle of the common law as explained in Lee v The Queen [2014] HCA 20; (2014) 253 CLR 455 at [32]- [33], the prosecution is to prove the guilt of an accused person and cannot compel a person charged with a crime to assist in the discharge of its onus of proof.

1. Both the Court of Appeal and the High Court considered whether the risk of prejudice in a criminal proceeding, arising from the accused first giving evidence in a civil proceeding, could be overcome or negated by protective orders made in the civil proceeding. The Court of Appeal held that the making of non-publication orders suppressing evidence given in the civil proceeding was not "the best the court can do"to protect the accused's privilege against self-incrimination, and that in those circumstances a stay was warranted (at [62]- [63]). The High Court, at [46], said this:

The Court of Appeal's view, that protective orders would not suffice to remove the risk of prejudice to the second Respondent's defence, is clearly correct.

1. The High Court also observed (at [44]) that closing the court as a means of attempting to maintain the confidentiality of evidence given by an accused in the civil proceeding was not a proper reason for departing from the open court principle.[11]

[30] Zhao is distinguishable from the current proceedings in a number of respects. In Zhao there had been a contested committal hearing and the date for trial of the criminal charges had been fixed. It was clear to the accused (Xing Jin) what the Crown would allege and seek to prove. Jin had a fair idea of the evidence which the Crown might adduce. There was a significant overlap between the subject matter of the charges and the matters to which he would need or wish to depose in the forfeiture proceedings, but importantly Jin could not defend the forfeiture proceedings without telegraphing his likely defence of the criminal proceedings. If the forfeiture proceedings were to precede the criminal proceedings, the Crown would be informed in advance of trial of Jin's likely defence to the criminal charges. The Court found that the interests of justice were not served by requiring Jin to defend the forfeiture proceedings. What is important to note is that the High Court concluded that the Commissioner of the Australian Federal Police would suffer no relevant prejudice from a delay in the continuation of the forfeiture proceedings.

[31] What distinguishes the current matter from the various authorities to which I have been referred is that this is not a matter where the proceedings will serve as a "dress rehearsal"[12] or a "test-run"[13] for the criminal proceedings.

[32] Hunt J in Gypsy Fire v Truth Newspapers Pty Ltd observed:

If, therefore, a defendant in a civil defamation litigation has been charged with a criminal offence arising out of the same subject matter, or if there is a real prospect that he will be so charged, it is open to him to seek a stay of the civil litigation until the conclusion of the criminal prosecution if he is able to show that his obligation in that litigation to disclose his case in answer to the criminal charge might lead to a potential miscarriage of justice in the prosecution. Such an application must obviously be made before his case has been disclosed in the civil litigation.

Upon that basis, the defendant's application for a stay of proceedings in the present case must be refused. It has already filed a defence and given at least some particulars of the substantive defences raised. It has already given discovery. Although it has not yet answered the plaintiff's interrogatories, the nature of its defence to the criminal prosecution must already have been disclosed not only by the steps which it has taken so far but also, I should assume, in the cross-examination of the plaintiff (as the complainant), in the committal proceedings ... there has been no suggestion made by the defendant in support of its application that it has anything further in relation to its case in answer to the criminal charge which it wishes to withhold. Indeed, I was informed (without objection) that the defendant has notified the Magistrate that it proposes to go into evidence in the committal proceedings.[14]

[33] The Second Respondent elected not to give or call evidence and the Third to Ninth Respondents have given evidence in the proceedings both in affidavit form and orally. The Third to Ninth Respondents have been the subject of cross examination and written submissions have been filed. Save for oral submissions, the matter has reached a final stage. The accused are not in danger of their rights being impinged upon by the commencement of civil proceedings. Nor is it a case of impending concurrent proceedings where a choice needs to be made between giving preference to the criminal proceedings over civil proceedings. The criminal proceedings are on the Third to Ninth Respondents own submission "embryonic". By contrast, the current proceedings in this Commission have reached an advanced stage. Unlike Zhao there would be significant prejudice to Ms Kelsey caused by the delay, in particular, her inability to obtain her primary remedy, namely reinstatement and the consequences flowing therefrom.

[34] Item (j) in McMahon sets out a list of six factors which are also relevant in assessing whether there is a danger of injustice in the criminal proceedings. In the submission of Mr Murdoch QC, they were addressed as follows:

(a) The possibility of publicity that might reach and influence jurors in the civil proceedings - there has already been extensive publicity, further publicity is a possibility only the person can be further mitigated by suppression orders. In any event, a suitable direction can be given to a jury;

(b) The proximity of the criminal hearing - the criminal proceedings are embryonic and it is unlikely that all eight matters will be heard within the next year or more likely two years;

(c) The possibility of miscarriage of justice e.g. by disclosure of a defence enabling fabrication of evidence by prosecution witnesses, or interference with defence witnesses - there is no possibility of any miscarriage of justice arising from the disclosure of a defence, because the Third to Ninth Respondents have disclosed their defence. Each of them has given affidavit and oral evidence in the proceedings and the second Respondent chose not to call any evidence in support of his defence;

(d) The burden of the defendant of preparing for both sets of proceedings concurrently - there is no extra burden cast upon the Second to Ninth Respondents in this regard because these proceedings have really been completed say for the oral closing submission;

(e) Whether the defendant has already disclosed his defence to the allegation - the second Respondent filed his response and earlier affidavit (though this was not relied on for the substantive hearing) and the third to the ninth Respondents have similarly disclose their responses including by electing to adduce positive affidavit evidence and be cross-examined regarding the allegations in the proceeding;

(f) The conduct of the defendant, including his own prior invocation of civil process when it suited him - the third to the ninth Respondents made forensic decisions within the process to suit themselves by adducing positive evidence about their reasons for terminating Ms Kelsey's employment and deploying this to Ms Kelsey's disadvantage in the interim reinstatement hearing.

[35] The thrust of the Second to Ninth Respondent's submissions centre around the potential adverse publicity which may ensue as a consequence of the continuation and determination of the proceedings in the Commission. It is contended that the Commission cannot safely assume that any publicity will accurately and faithfully represent the full force and effect of any judgment. The Second Respondent argues that the ability of the Commission to reinstate or to compensate Ms Kelsey creates an inevitable prejudice in the mind of the jury pool given the publicity which would surround such a determination.

[36] In Yuill v Spedley Securities (in liq), Kirby P (as his Honour then was) wrote:

There are, in my view, considerations additional to those which are referred to by Wootten J which it would be relevant to consider in proceeding to determine an application for a stay such as was before Rolfe J. For example, it is in my opinion relevant to take specifically into account the public's own interest in the normal primacy of the administration of criminal justice, being a part of the public law of the community relevant to its good order and peaceful government. This consideration might help explain why, ordinarily but not universally, such proceedings should be heard and determined first. Also relevant is the fact that serious criminal proceedings are still determined, in most cases in this State, by juries. Most civil litigation is now decided by judges sitting alone. Judges, by their training, are conventionally considered to be better able to make the mental adjustments for excluding the prejudicial effect of pre-trial publicity then lay jurors are. The sensational and highly personalised presentation of much news by the news media today has become a factor relevant to the fair trial of prominent "personalities". Guarding their right to a manifestly fair criminal trial is as much in the interest of the community and its legal institutions as in the interests of the individuals concerned. A further consideration in cases of this class is the "deep-rooted" inclination of our law to avoid, directly or indirectly, depriving a person of the right to silence in criminal proceedings. Sometimes the prior litigation of the criminal trial may have that effect, either by its interlocutory procedures or by the need of the accused, in the forensic setting of the civil trial, to give evidence or ask questions, thereby disclosing a defence to the outstanding criminal charge. More than lip service must be paid by courts to the preservation of these enduring features of the criminal process, whether in the interpretation of apparently inconsistent statutes or in the exercise of a discretion to stay civil proceedings until related criminal proceedings are completed. Such features exist not only to protect the rights of the individual accused but also to help define the relationship between the organised state and citizens generally.[15] (citations omitted)

[37] Mr Hunter QC submitted that the risk of ongoing publicity was real and sufficient to justify a stay of the proceedings to prevent an unfair criminal trial. Reference was made to the decision of MacCallum J in McLachlan v Browne (No 9) where her Honour observed:

1. Separately, accepting the principles in Kanaan, this is not merely a case of pre-trial publicity concerning the events the subject of the criminal trial. Two juries will be called upon in separate forums to decide the same questions of fact. In my view, it would be very difficult for the jury in the criminal trial to put out of its mind the verdict reached by the jury in the civil trial. If the allegations made in the truth defences are found by the civil jury to be proved, that would obviously be prejudicial to Mr McLachlan in his defence of the criminal charges. If they are found not to be proved, that would be prejudicial at least in some way to the interests of the Crown in those criminal proceedings. Whatever direction might be given in the criminal proceedings, I think it would be difficult for the jury not to have regard at some level to those factors.[16]

[38] McLachlan v Browne (No 9) involved the bringing of two actions for defamation in relation to allegations of sexual misconduct on behalf of Mr Craig McLachlan against Ms Whelan Browne and others. Both actions were listed for hearing on 4 February 2019. Separately, McLachlan was charged with ten offences, nine of which were based on allegations relied upon in the truth defences in the defamation proceedings. The criminal proceedings were due to come before the Victorian Magistrates Court on 8 February 2019. It is against that background that McLachlan sought and obtained a stay of the civil proceedings in the New South Wales Supreme Court. Whilst there had been numerous interlocutory steps taken, the civil trial had not commenced and no evidence taken. In the passage in McLachlan relied upon by the Second Respondent, her Honour accepts the principles expressed in Kanaan v R[17] to the effect that the Court should proceed on the assumption that juries are robust and have an ability to put material extraneous to the evidence in the proceeding before them out of mind.

[39] In Australian Competition and Consumer Commission v The Construction, Forestry, Mining and Energy Union[18], Middleton J was called on to consider the prejudice to the Respondents in respect of the criminal proceeding, in particular, the risk of the jury becoming aware of evidence, findings or orders in the civil proceeding and a juror's ability to put this information out of their minds in coming to a verdict. Middleton J wrote:

1. In General Manager of the Fair Work Commission v Thomson [2013] FCA 380, Jessup J refused to assume that the media and the public would not readily be able to make a distinction between the different contraventions alleged in the criminal and civil penalty proceedings in that case and relevantly said (at [20]):

... At the purely factual level, the conduct with which the balance of the present proceedings is concerned is quite different from that which forms the basis of the charges which have been laid against the Respondent. It is true, perhaps, that there are some threads of legal principle which run through all of the presently relevant matters, but those threads would, in my view, be much more apparent to the legal practitioner than to members of the public. Furthermore, if, as I presume will be the case, the media will report the present proceeding in an accurate and responsible way, the risk that reasonable members of the public would fail to appreciate that there are two proceedings against the Respondent, each with its own factual allegations, is a negligible one. Doubtless the circumstance that the Respondent is also facing the criminal charges will be commented upon from time to time, but this puts the Respondent in a position no different from any person who has the misfortune to be involved in separate legal proceedings within what is broadly the same time frame. Even if one of those proceedings is to be determined by way of a jury trial, the fact that the Respondent has recently been (or is still being) sued in another proceeding is, in my view, no basis to stay the latter.

1. The situation is analogous here. Even assuming that jurors were to learn of the evidence, findings or orders made in this proceeding in respect of the s 45D conduct (which is remote in any event), I do not accept the Respondents' assertion that jurors will be unable to put this information out of their mind in deciding the criminal charge, regardless of judicial direction, putting aside the lapse of time anyhow. The information provided out of this proceeding would only be relevant to a limited extent and then only by way of context or background.

1. Moreover, as Mansfield J observed in Guglielmin v Trescowthick (No 3) [2005] FCA 139; (2005) 220 ALR 535 (at [48]):

It should not readily be assumed that a duly selected jury, properly instructed, should be unable to hear and determine the criminal charges purely on the evidence adduced despite any (or even extensive) publicity about the allegations made in civil proceedings such as the present, and the progress of those proceedings at interlocutory stages, where the factual issues to be addressed can be seen to significantly overlap.

I have already mentioned the comments of Finkelstein J in HLP and do not need to repeat them.

1. Further, in Australian Securities and Investments Commission v ActiveSuper Pty Ltd (No 5) [2013] FCA 369, Gordon J said (at [23]) that:

[t]he possibility of adverse media publicity does not provide grounds for a stay, nor is it a matter of any significant weight in determining whether to grant a stay.[19]

[40] The decision of Middleton J was the subject of an appeal. In Construction, Forestry, Mining and Energy Union v Australian Competition and Consumer Commission[20] the Full Court of the Federal Court, in dismissing the appeal, were not satisfied that an error had been established sufficient to overturn the discretionary judgment of Middleton J or sufficient to warrant the grant of leave to appeal. However, Dowsett, Tracey and Bromberg JJ did make the following observations:

[45] ... With respect to the primary judge, we hold reservations about his reasoning on this issue. In particular, we do not share the primary judge's confidence that members of the jury in the blackmail proceeding would not learn of findings made in the s 45D proceeding or that, if they did, they would be able to put aside that knowledge either in compliance with judicial direction or because of a capacity to make a distinction between the different contraventions alleged in the respective proceedings.

[46] As to jury contamination, we share the reservations expressed by Finkelstein J in Australian Securities and Investments Commission v HLP Financial Planning (Aust) Pty Ltd [2007] FCA 1868; (2007) 164 FCR 487 at [59], as follows:

Third, there is potential for an adverse impact on the jury. The civil case will be decided on evidence that, for the most part, will not be available to the prosecutor in a criminal trial. Imagine what would happen if a jury discovers that a civil court has ruled that Mr Berlowitz' conduct is illegal. The judge presiding over the criminal trial will be obliged to tell the jury to leave that out of account. It is axiomatic in our courts that jurors can be trusted to leave out of their consideration things that they are instructed to leave out. Yet many regard this kind of instruction as little more than wishful thinking. Perhaps the jurors will have explained to them that the judge who made the ruling acted on evidence not before the jury and that in any event a lower standard of proof was required in the civil court. Whether those instructions will result in a fair criminal trial may be strongly doubted.

[41] In Flegg v Hallett, Flanagan J took a different view concluding that the defendant could defend the defamation proceedings without any danger of injustice in the criminal proceedings. It was argued before Flanagan J that the defendant would lose his right to silence if he had to give evidence in the civil proceeding. It was further argued that the civil proceedings were likely to receive extensive publicity which may also disadvantage the applicant in his criminal defence. However, his Honour was of the view that any danger was notional rather than real. As he noted, the defendant had already publicly commented on the alleged conversation and had fully pleaded his defences to the defamation claim.

[42] The demonstrated prejudice to the plaintiff in Flegg v Hallett was argued to be:

(i) A State election was due to be called and the stay had the real potential to prejudice the plaintiff's prospects of being preselected;

(ii) The proceedings are at an advanced stage - the trial dates being setdown;

(iii) What is sought is an indefinite stay of the proceedings as there was no evidence of when the criminal proceedings might be concluded;

(iv) The nature of the plaintiff's claim, and his reasons for bringing it, is to vindicate his reputation. The vindication offered by any judgment is diluted with time; and

(v) The defendant has conducted the proceedings in a way that has aggravated the distress of the original defamation.

I accept the submissions made by Mr Ferrett on behalf of the plaintiff as to prejudice. The civil proceedings have been set down for trial since April 2014. By those proceedings the plaintiff seeks to vindicate his reputation. It is unknown when the criminal matter will be listed for trial. If a stay is granted it would require the vacation of the trial dates and delay the resolution of the defamation proceedings considerably.[21]

[44] Whilst I accept that the outcome of these proceedings is likely to receive publicity, there is likely to be a reasonably sufficient intervening period between the proceedings in the Commission and the subsequent criminal proceedings.[22] Irrespective of that, I do not accept that a jury, properly instructed would be unable to determine the criminal charge purely on the evidence before them despite any publicity. Hayne J considered a similar issue concerning publicity in Australian Securities Commission v Kavanagh:

Proceedings against the Respondents and others concerned with Pro-Image have already been the subject of report in the newspapers. It may be expected that the trial of the civil proceedings will also attract some publicity but I do not consider that it therefore follows that there is any real likelihood of any prejudice to the conduct of any subsequent criminal trial. Certainly, no indication was given in the course of submissions of how any such prejudice would arise. I do not consider this to be a matter of great weight.[23]

[45] The affidavit of James Fraser Christensen[24] references the Insentia report which identified 184 media articles in the period between 27 April 2018 and 26 April 2019. As evidenced by Mr Christensen's affidavit, these proceedings have already been the subject of extensive media coverage. That media coverage is already in the public arena. It cannot be erased or its potential impact on a jury cannot be ameliorated by the granting of a stay in these proceedings. As submitted by Mr Murdoch QC, it is a case of "the cat's out of the bag"[25].

[46] It is submitted that an important central question to be resolved is whether the Third to Ninth Respondents ought to be believed as to their reasons for terminating Ms Kelsey's employment. In order to do that, the Commission must assess the relative credit of each witness. However, if a stay was granted, the Commission would be called upon to assess that credit some years hence and after the criminal proceedings have concluded. Appellate courts have long expressed the view that a trial judge's credit findings can be rendered unsafe by delay in delivering judgment or that such delay may infect the trial judge's acceptance of someone's evidence and the findings he or she made in accordance with that evidence.

[47] The First Respondent through King & Company Solicitors wrote to the Minter Ellison Solicitors on 28 May 2019. In that correspondence, Minter Ellison was advised that the Interim Administrator of Logan City opposed Ms Kelsey's application to be reinstated to her former position pending the outcome of these proceedings. The Administrator did however offer, on terms, that the Council would pay Ms Kelsey a sum equal to the periodic salary payments provided for under her terminated contract of employment to assist in defraying any possible financial prejudice arising out of any further delay in her return to full employment with the First Respondent or elsewhere. The offer was refused by Ms Kelsey.

[48] Mr Murdoch QC submits that the acceptance of the offer on the condition that a stay be granted would have an adverse effect on Ms Kelsey. He contends, that to deny Ms Kelsey the opportunity to return to her employment before the expiry of the contract of employment on 25 June 2021 would deny her the opportunity to demonstrate that she was capable of undertaking the duties of Chief Executive Officer with the First Respondent and thereby be in a position to have her contract of employment extended beyond its expiry. He submits that Ms Kelsey would:

(a) lose the opportunity to demonstrate to a new Council, once elected, that she ought to be awarded a second contract; and

(b) even if she were not ultimately offered a second contract, she will lose the opportunity to work for Logan City Council during this time including the ability to protect her reputation, and her future employment prospects.

[49] In the affidavit of Ms Kelsey of 28 May 2019, she deposes to the attempts that she is taking to secure employment and the ongoing strain and pressure a continued delay of these proceedings would cause her. She states:

1. My well-being is at risk if the stay is granted as this will extend the uncertainty for me and my family - an uncertainty that has already been a considerable length of time to date.

1. My well-being is best served by a final solution to matter including, as I seek in this proceeding, returning to job that, I believe, I was unlawfully denied and gives meaning and purpose to my service. I will also reinforce to me the importance of duty holders meeting their obligations to report suspected corrupt conduct and the institutions to ensure those who have made such reports are supported in that process and encouraged to do so.

[50] In White v Australian Securities and Investments Commission, Muir JA observed that in considering whether such a stay should be granted the rights of other parties including a consideration of the public interest must be taken into account.[26]

[51] Mr Murdoch QC submits that given the length and stage of these proceedings and the potential impact on Ms Kelsey it is in the public interest that a stay be withheld.

[52] When regard is had to the objects contained in s 3 of the PID Act and the general protection provisions in s 278 of the IR Act, the public interest is engaged. A public interest disclosure is a disclosure about wrongdoing in the public sector. It serves the public interest. It is in the public interest that these proceedings continue without delay. A delay in determining these proceedings would, in my view, erode public confidence in the administration of justice.

[53] The question of the delay of these proceedings is a relevant factor to be considered in weighing up the balancing of justice between Ms Kelsey and the Second to Ninth Respondents. It must be assumed that the criminal charges against the Second to Ninth Respondents are unlikely to be sent to trial before mid to late next year. Possibly longer. I must have regard to the possibility of an appeal, the criminal proceedings may not be finalised until the following year. It would then be some further period before the Commission would be in a position to hear the final oral submissions of the parties and render a decision.

[54] There is, of course, another aspect to the public interest. Ms Kelsey has an interest in having these proceedings progress in the ordinary course. In a matter such as this, the public interest is magnified by the resources that the Commission has devoted to the preparation and conduct of this matter. It is something which must not be disregarded.[27]

[55] In the affidavit of 28 May 2019 Ms Kelsey further deposes that the professional costs of the proceedings have been substantial. She said that she has entered into a concessional arrangement with her legal advisers in respect of her professional fees. A delay in the proceedings brought about by the granting of stay would "take her circumstances outside of those contemplated by the arrangement."[28]

[56] In McLachlan v Browne (No 9) McCullum J observed:

The second consideration relied upon by the defendants was the question of costs. I accept that is a significant consideration against granting a stay. I am prepared to proceed on the assumption that both parties have expended significant costs in the preparation of these proceedings and that those costs are likely to have escalated significantly in the last month in the period leading up to the date fixed for trial. I should note that the evidence was silent concerning costs as to the position of Ms Whelan Browne. I assume if she was to suffer any individual hardship as to costs beyond that of the corporate defendants, specific evidence would have been put on.[29]

[57] It is not in contention that the Second to Ninth Respondents costs associated with the defence of these proceedings have been met by the First Respondent's insurer.

[58] In considering this matter I have had regard, amongst other things, to the history of these proceedings. In particular, I note that proceedings commenced on 1 December 2017 against the First and Second Respondents with an amended application filed on 23 March 2018 joining the Third to Ninth Respondents. The chronology of this matter indicates that there have been a multitude of interlocutory steps, including a substantial and ultimately unsuccessful reinstatement application. The substantive hearing commenced on 17 December 2018. The hearing of the evidence was spread over two periods of time concluding on 15 February 2019. Written submissions from all parties have been filed in the Industrial Registry.

[59] The principal basis upon which the Second to Ninth Respondents seeks to justify the stay is that, as submitted by the Second Respondent there is "...an inevitable overlap between the criminal charges against all of the Second to Ninth Respondents and this proceeding". As such, it is argued that it gives rise to a real risk of prejudice to the conduct of the criminal proceedings against the Second to Ninth Respondents. Coupled with that is the argument that the publicity arising out of these proceedings would cause the Second to Ninth Respondents irreparable harm in defending the criminal proceedings. I do not accept that submission.

[60] As I have observed above, the distinguishing feature of this matter is that the civil proceedings are at an advanced stage. The criminal proceedings are "embryonic". There is likely to be a significant period of time before the criminal trial is set down for hearing giving some degree of separation between the outcome of these proceedings and the hearing of the criminal charges. Moreover, these proceedings have already been the subject of significant media attention and much of it in the public arena. The granting of a stay in these proceedings is not likely to address any concerns the Second to Ninth Respondents might have in that regard.

[61] The submissions of the Second to Ninth Respondents, in effect, ask me to abandon the presumption that juries are robust and have an ability to put material extraneous to the evidence in the proceeding before them out of mind and to assume that they will disregard the direction given to them by the trial judge in the criminal proceedings. They ask me to assume that a juror or jurors will not be true to their oath or affirmation to conscientiously try the charge against the accused according to the evidence. I do not accept that proposition. As was observed by McMurdo P, Keane and Muir JJA in R v Ferguson; ex parte A-G (Qld):

As our discussion of the authorities shows, juries are expected to discharge their duties properly even after sensationalised and prejudicial media reporting of quite horrific crimes. That expectation is informed, both by the necessity to accept, if jury trials are to be maintained, that jurors will be true to their oaths and follow the trial judge's directions, and the justified confidence that jurors do routinely meet that necessity. It may be that, on occasion, orders for a change of venue or an adjournment of a trial may be necessary to defuse potential prejudice from pre-trial publicity.[30]

[62] The question of the delay of these proceedings is a relevant factor to be considered in weighing up the balancing of justice between Ms Kelsey and the Second to Ninth Respondents. What the Second to Ninth Respondents are seeking is to grant a stay for some indeterminate time until the outcome of the criminal proceedings are concluded. It would then be some further period of time before the Commission would be in a position to hear the final oral submissions of the parties and render a decision.

[63] Ms Kelsey's contract of employment is for a term which expires on 25 June 2021. If a stay is granted, it is probable that the contract of employment will expire before these proceedings are determined. In those circumstances, I accept the argument that Ms Kelsey would lose the opportunity to demonstrate to a new Council, once elected, that she ought to be awarded a second contract. Equally, even if she was not offered a further contract she would lose the opportunity to work at the First Respondent during balance of her contract including the ability to protect her reputation, and her future employment prospects. I do not accept that the offer of the Administrator of the First Respondent is sufficient to deal with the prejudice to which Ms Kelsey claims. The offer was conditioned on her acceptance of the stay. Ms Kelsey's position would not change. She will have lost the opportunity to return to her employment and notwithstanding what has been submitted, compensation is not in those circumstances an adequate remedy.

[64] The proceedings before the Commission involve allegations that the Second to Ninth Respondents have taken adverse action or reprisal action against her in contravention of the Industrial Relations Act 2016 or the Public Interest Disclosure Act 2010. Ms Kelsey is entitled to have the proceedings resolved one way or the other without unnecessary delay. It is in the public interest that this is done. A failure to do so would, I believe, erode public confidence in the administration of justice.

[65] I do not accept the argument that "...it is manifestly unfair to force the Third to the Ninth Respondents to make submissions in this matter prior to the resolution of the criminal charges." As noted elsewhere, the Respondents have already filed submissions. As I understand them, they contain no concession with respect to fact or law.

[66] I accept the submission of Mr Murdoch QC that on a proper assessment of the factors identified by Wootten J, in particular, those factors set out in paragraph (j) that the Second to Ninth Respondents have failed to discharge the burden of demonstrating that it is just and convenient that Ms Kelsey's rights should be interfered with.

[67] Gould v McMahon requires the Commission to consider, whether is it in the interests of justice that the proceeding be stayed. In my view the Commission's discretion should be exercised in favour of refusing the application for a stay of these proceedings. On balance, the prejudice to Ms Kelsey outweighs any potential prejudice to the Second to Ninth Respondents. Accordingly, the stay application should be dismissed. Accordingly, I order that:

1. Application dismissed;
2. Costs be reserved.

[1] Affidavit of Timothy Pelham Fynes-Clinton 29 May 2019.

[2] Kelsey v Logan City Council and Another [2018] QIRC 009.

[3] McMahon v Gould (1982) 7 ACLR 202 , 206.

[4] [2008] VSC 473; (2008) 21 VR 252.

[5] [2007] QSC 293, [12].

[6] [2013] QCA 357; (2013) 237 A Crim R 83, 92 [25].

[7] Industrial Relations Act 2016 ss 451, 452, 539; Industrial Relations (Tribunals) Rules (Qld) r 41.

[8] Commissioner of Australian Federal Police v Zhao (2015) 225 CLR 46; [2015] HCA 5, [36].

[9] (1993) 12 ACSR 69, 72.

[10] (2015) 225 CLR 46; [2015] HCA 5.

[11] [2016] FCAFC 97; (2016) 242 FCR 153, [22]-[25].

[12] McLachlan v Browne (No 9) [2019] NSWSC 10.

[13] State of Queensland v Bush [2003] QSC 375.

[14] (1987) 9 NSWLR 382, 388-389.

[15] (1992) 8 ACSR 272 at 274-5.

[16] McLachlan v Browne (No 9) [2019] NSWSC 10, [39].

[17] [2006] NSWCCA 109, [24]-[30] (Hunt AJA, Buddin and Hoeben JJ.)

[18] [2016] FCA 504.

[19] [2016] FCA 504 [92]-[95] (italicised in original).

[20] [2016] FCAFC 97; (2016) 242 FCR 153.

[21] [2014] QSC 220, [2015] 1 Qd R 191, [59].

[23] (1993) 12 ACSR 69, 76.

[24] Affidavit of James Fraser Christensen 16 May 2019 at paras: 12-17.

[26] [2013] QCA 357; (2013) 237 A Crim R 83, 92 [25].

[27] Australian Securities and Investments Commission v Managed Investments Limited & Ors (No 5) [2013] QSC 313, [26]

[28] Affidavit of Sharon Kelsey 28 May 2018.

[29] McLachlan v Browne (No 9) [2019] NSWSC 10, [34].

[30] R v Ferguson; Ex parte Attorney-General (Qld) (2008) 186 A Crim R 483, 502. [58]. See also: The Queen v Glennon [1992] HCA 16; (1992) 173 CLR 592.