exemptions under ss 36, 37(1)(b), 37(2)(b), 40(1)(d), 42 and 45 - decision varied.

FREEDOM OF INFORMATION - deletion of exempt matter under s 22 - what is possible - what is reasonably practicable - material not deleted.

FREEDOM OF INFORMATION - whether searches for requested documents adequate - relevance of record keeping practices and procedures in considering adequacy - relevance of logical flow of documents in the file and against the events to which they relate in considering adequacy - searches adequate.

PRACTICE AND PROCEDURE - whether possible to review decision relating to approximately 3,500 pages by reference to samples - consideration of merits review and Tribunal's powers and duties - sampling rejected.

PRACTICE AND PROCEDURE - whether applicant permitted to withdraw part of application - not permitted but Tribunal has power to affirm that part of the decision.

PRACTICE AND PROCEDURE - limits on the use that parties may make of documents lodged in the Tribunal and summonsed - differences between lodgement and production on summons - limits on use that may be made of material produced on summons removed if admitted in evidence.

PRACTICE AND PROCEDURE - stay of operation of decision - source of power - whether s 41(2) or s 43(5B) of the AAT Act is appropriate source - s 43(5B) is the appropriate and only source of power.

Administrative Appeals Tribunal Act 1995 ss 21(2), 25(4A), 28(3A)(b), 29(1)(d), 29(4), 29A(2), 29B, 30(1)(a), (b) and (d), 34D(1)(b), 34J, 35(2)(b) and (c), 35(3) and (3)(b), 35AA(c), 36(2), 36B(2) and 37(1), (1AA), (1AB), (1AC), (1AE), (1AF), (1A), (1B) and (2), 40(1A), 42A(1A) and (1B), 42B, 42C, 43, 61(3) and (4)

Archives Act 1983 ss 3(1), 5(2)(c), 24(1), 24(2)(a), (b) and (c)

Australian Securities and Investments Commission Act 1989 s 7

Australian Securities and Investments Commission Act 2001, ss 5(1), 9(1), 11(11), 12A, 17, 18, 19, 24, 25, 26, 27, 102, 124(4C), 127(4)(d), 127, 148 and 261

Corporations Act 2001 ss 250N, 250N(1), (2) and (4), 341(1) and (2) Parts 2G.2, 2M.2, 2M.3 and 2M.4, 5.3A

Financial Management and Accountability Act 1997

Freedom of Information Act 1982 ss 3(1), 9(1)(a), 11, 22, 29, 36, 40, 42, 45, 54(1), 55, 61(1)

Freedom of Information Act 5 USC 552

Freedom of Information Amendment Act 1991 No. 137 of 1991: s 33

Judiciary Act 1903 ss 55D(1), 55E(2), (3) and (6), 55ZF, Part VIIIB, Division 2

Administrative Appeals Tribunal Regulations 1976 3 15 and Forms 8 and 9

Australian Securities and Investments Commission Regulations 2001 rr 8AA and 8A

Freedom of Information (Fees and Charges) Regulations r 11

AM & S Europe Ltd v Commission of the European Communities [1983] QB 878; 1 All ER 705

Applicant VEAL v Minister of Immigration and Multicultural Affairs [2005] HCA 72; (2005) 225 CLR 88; (2005) 222 ALR 411; 87 ALD 512; (2005) 80 ALJR 228

Arnold (on behalf of Australians for Animals) v Queensland [1987] FCA 148; (1987) 73 ALR 607; 13 ALD 195

Ascic v Australian Federal Police (1986) 11 ALN N184

Attorney-General's Department v Cockcroft (1986) 64 ALR 97

Attorney-General (NT) v Maurice [1986] HCA 80; (1986) 161 CLR 475

AWB Ltd v Cole (No 5) [2006] FCA 1234; (2006) 155 FCR 30; 234 ALR 651

Baker v Campbell [1983] HCA 39; (1983) 153 CLR 52; 49 ALR 385

Bartlett v Secretary, Department of Social Security [1997] FCA 1581; (1997) 49 ALD 380

Booker and Department of Social Security AAT 6189, 13 September, 1990

Botany City Council v Minister for Transport and Regional Development [1996] FCA 1507; (1996) 137 ALR 281

Button v Evans (1984) 56 ALR 317

Collins v Parker Unreported, SC (NSW), 11 May 1984

Commissioner of Taxation (Cth) v Pratt Holdings Pty Ltd [2005] FCA 1247; (2005) 225 ALR 266

Commonwealth of Australia v Lyon Unreported (1979) 24 ALR 300

Corrs Pavey Whiting and Byrne v Collector of Customs of Victoria and Alphapharm Pty Ltd [1987] FCA 266; (1987) 14 FCR 434; 13 ALD 254

Danvers v Commissioner for Railways (NSW) [1969] HCA 64; (1969) 122 CLR 529

Department of Health v Jephcott [1985] FCA 370; (1985) 8 FCR 85; 62 ALR 421; 9 ALD 35

Drake v Minister for Immigration and Ethnic Affairs (1979) 2 ALD 60; 24 ALR 577

Director of Public Prosecutions v Smith [1991] VicRp 6; [1991] 1 VR 63; (1991) 100 FLR 6

Ellison v Vukicevic (1986) 7 NSWLR 104

Environmental Protection Agency v Mink [1973] USSC 17; 410 U.S. 73 (1973) at 86

Esso Australia Resources Ltd v Plowman [1995] HCA 19; (1995) 183 CLR 10; 128 ALR 391

Finnane v Australian Consolidated Press Ltd [1978] 2 NSWLR 435

Grant v Downs [1976] HCA 63; (1976) 135 CLR 674; 11 ALR 577

Hamersley Iron Pty Ltd v Lovell (1998) 19 WAR 316

Harris v Australian Broadcasting Commission (1984) 6 ALN N347

Harris v Australian Broadcasting Corporation and Others [1983] FCA 242; (1983) 50 ALR 551; 5 ALD 545

Harris v Australian Broadcasting Corporation (No 2) [1983] FCA 281; (1983) 78 FLR 264

Hong Ye v Minister for Immigration and Multicultural Affairs [1998] FCA 341; (1998) 153 ALR 327

Hatzimanolis v ANI Corporation Ltd [1992] HCA 21; (1992) 173 CLR 473; 106 ALR 611

Hearne v Street [2008] HCA 36; (2008) 235 CLR 125; (2008) 248 ALR 609; 82 ALJR 1259

Hearts of Oak Assurance Co v Attorney-General [1931] 2 Ch 370; [1932] AC 392

Hodgson v Imperial Tobacco Ltd [1998] EWCA Civ 224; [1998] 2 All ER 673

Johns v Australian Securities Commission [1993] HCA 56; (1993) 178 CLR 408

Jorgensen v Australian Securities and Investments Commission [2004] FCA 143; (2004) 208 ALR 73

Kelly v JRA Ltd (1990) 92 ALR 651

Kavvadias v Commonwealth Ombudsman (No 2) [1984] FCA 179; (1984) 2 FCR 64; 54 ALR 285; 6 ALD 198

Kelson v Forward [1995] FCA 1584; (1995) 60 FCR 39

London Artists Ltd v Littler [1968] EWCA Civ 3; [1969] 2 QB 375

McKenzie v Secretary, Department of Social Security (1986) 65 ALR 645

McKinnon v Secretary, Department of Treasury [2005] FCAFC 142; (2005) 145 FCR 70

McKinnon v Secretary, Department of the Treasury (2006) 228 CLR 423; 229 ALR 187; 91 ALD 516

Melbourne Steamship Co Ltd v Moorehead [1912] HCA 69; (1912) 15 CLR 333

Minter v Priest [1930] AC 558

Noordhof v Bartlett (1986) 12 FCR 209

Otter Gold Mines Ltd v McDonald (1997) 76 FCR 467; 147 ALR 322; 48 ALD 222

Re Proh and Tax Agents' Board (Victoria) [2010] AATA 149; (2010) 115 ALD 68

Prudential Assurance Co v Fountain Page [1991] 3 All ER 878; 1 WLR 756

Purden v Registrar in Bankruptcy (1982) 43 ALR 512

Re ABCD and Commissioner of Taxation [2008] AATA 898; 2008) 50 AAR 287; (2008) 75 ATR 393

Re Bracken and Minister for Education and Youth Affairs [1985] AATA 8; (1984) 2 AAR 406

Re Callejo and Department of Immigration and Citizenship [2010] AATA 244; (2010) AAR 308

Re Carver v Department of the Prime Minister and Cabinet (1987) 6 AAR 317

Re Chapman and Minister for Aboriginal and Torres Strait Islander Affairs (1996) 43 ALD 139

Re Connolly and Department of Finance (1994) 34 ALD 655

Re Doran Constructions Pty Ltd (in liq) [2002] NSWSC 215; (2001) 194 ALR 101

Re General Merchandise & Apparel Group P/L and CEO of Customs and Australian Weaving Mills [2009] AATA 988; (2009) 114 ALD 289; 51 AAR 1

Re Howard and Treasurer of the Commonwealth of Australia (1985) 7 ALD 626

Re James and Others and Australian National University (1984) 6 ALD 687

Re Lordsdale Finance Limited and Department of the Treasury [1985] AATA 174

Re Millis and Australian Archives [1997] AATA 361; (1997) 47 ALD 427

Re Murtagh and Commissioner of Taxation [1984] AATA 249; (1984) 54 ALR 313; 6 ALD 112

Re Nitas and Minister for Immigration and Multicultural Affairs

Re Pergamon Press Ltd [1971] Ch 388

Re Petroulias and Commissioner of Taxation [2006] AATA 333; (2006) 62 ATR 1175

Re Radar Investments Pty Ltd and Ors and Health Insurance Commission [2004] AATA 166; (2004) 80 ALD 733

Re Slater and Cox (Director-General, Australian Archives) [1988] AATA 110; (1988) 15 ALD 20

Re Smith, Kline and French Laboratories (Australia) Ltd and Others v Secretary, Department of Community Services [1991] FCA 150

Re Thies and Department of Aviation (1986) 9 ALD 454

Re Waterford and Treasurer of the Commonwealth (No 1) (1984) 6 ALN N347

Re Waterford and Department of the Treasury (No.2) [1984] AATA 67; (1984) 5 ALD 588

Re Waterford and Treasurer of Commonwealth of Australia (No.2) [1985] AATA 114; (1985) 8 ALN N37

Re Williams and Registrar of the Federal Court of Australia [1985] AATA 226; (1985) 8 ALD 219

Rich v Australian Securities and Investments Commission [2004] HCA 42; (2004) 220 CLR 129; 209 ALR 271

Rich v Harrington [2007] FCA 1987; (2007) 245 ALR 106

Rilstone v BP Australia Pty Ltd [2007] FCA 1557

Robert Bosch (Australia) Pty Ltd v Mr Egon Fice, Member of the Administrative Appeals Tribunal [2009] FCA 247

Sankey v Whitlam (1978) 142 CLR 1

Searle Australia Pty Ltd v Public Interest Advocacy Centre and Another [1992] FCA 241; (1992) 108 ALR 163; 36 FCR 111

Smith and Aboriginal and Torres Strait Islander Commission [2000] AATA 512

Searle Australia Pty Ltd v Public Interest Advocacy Centre and Another [1992] FCA 241; (1992) 108 ALR 163; 16 AAR 28

Scott v Scott [1913] AC 417; [1911-1913] All ER 1

Spalla and Ors v St George Motor Finance Ltd and Ors [2004] FCA 1014; (2004) 209 ALR 703

Telstra Corporation Limited v Minister for Communications, Information Technology and the Arts (No. 2) [2007] FCA 1445

The Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission [2002] HCA 49; (2002) 213 CLR 543; 192 ALR 561

The News Corporation Ltd v National Companies and Securities Commission [1984] FCA 36; (1984) 1 FCR 64; 52 ALR 277; 6 ALD 83

Thomason v Campbelltown Municipal Council (1939) 39 SR (NSW) 347

Tillmanns Butcheries Pty Ltd v. Australasian Meat Employees Union & Ors [1979] FCA 85; (1979) 27 ALR 367; 42 FLR 331

Wallis v Downard-Pickford (North Queensland) Pty Ltd [1994] HCA 17; (1994) 179 CLR 388; 120 ALR 440

Water Conservation and Irrigation Commission (NSW) v Browning [1947] HCA 21; (1947) 74 CLR 492

Waterford v The Commonwealth of Australia [1987] HCA 25; (1987) 163 CLR 54

DECISION AND REASONS FOR DECISION [2010] AATA 649

And AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION

1. by consent, affirm the decision of the respondent dated 16 August 2004 in so far as it decides that the following documents are exempt under the Freedom of Information Act 1982:

(1) set aside the decision of the respondent dated 16 August 2004 in so far as it decides that the following documents are exempt under the Freedom of Information Act 1982:

(a) documents 179, 180, 215, 241, 244, 421, 444 and 650; and

(b) documents 346, 355, 366, 367, 368, 371, 422, 424, 425, 441, 447, 476, 514, 582 and 584; and

(2) substitute for that part of the decision a decision that:

(a) Documents 577 and 583 are not exempt under s 37(1)(b) of the Freedom of Information Act 1982; and

(b) Document 579 is not exempt under s 37(1)(b) of the Freedom of Information Act 1982 in relation to the whole of the document other than:

(i) the passage on page two beginning with the word "A" in the fourteenth line and ending with the word "meeting." on the seventeenth line; and

(ii) the passage on page two beginning with the word "Several" in the twenty third line and ending with the word "that" in the thirtieth line;

1. in so far as the decision of the respondent dated 16 August 2004 decides that Documents 1 to 341, 577, 579 and 583 are exempt under

ss 36 of the Freedom of Information Act:

(1) set aside the decision except in so far as it relates to the passage in Document 579 commencing with the word "MR" in the fourth line from the bottom on page two and ending with the word "Yes" on the last line of the third page; and

(2) substitute for that part of the decision a decision that:

(a) Documents 1 to 341, 577, 579 (except in so far as it relates to the passage in Document 579 commencing with the word "MR" in the fourth line from the bottom on page two and ending with the word "Yes" on the last line of the third page) and 583 are not exempt under

s 36 of the Freedom of Information Act 1982; and

(3) affirm the decision that the passage in Document 579 commencing with the word "MR" in the fourth line from the bottom on page two and ending with the word "Yes" on the last line of the third page is exempt under s 36 of the Freedom of Information Act 1982;

1. in so far as the decision of the respondent dated 16 August 2004 decides that Document 577, 579 and 583 are exempt under s 37(1)(b) of the Freedom of Information Act 1982:

(1) set aside the decision in relation to Documents 577 and 583 and the whole of Document 579 other than:

(a) the passage on page two beginning with the word "A" in the fourteenth line and ending with the word "meeting." on the seventeenth line; and

(b) the passage on page two beginning with the word "Several" in the twenty third line and ending with the word "that" in the thirtieth line;

(2) substitute for that part of the decision set aside a decision that Document 579 is not exempt; and

(a) the passage on page two beginning with the word "A" in the fourteenth line and ending with the word "meeting." on the seventeenth line; and

(b) the passage on page two beginning with the word "Several" in the twenty third line and ending with the word "that" in the thirtieth line;

1. in so far as the decision of the respondent dated 16 August 2004 decides that Documents 577, 579 and 583 are exempt under s 37(2)(b) of the Freedom of Information Act 1982:

(2) substitute a decision that Document 579 is not exempt under

s 37(2)(b) of the Freedom of Information Act 1982;

1. in so far as the decision of the respondent dated 16 August 2004 decides that Documents 1 to 341, 576, 577, 579 and 583 are exempt under 40(1)(d) of the Freedom of Information Act 1982:

(1) set aside the decision except in so far as it relates to the passage in Document 579 commencing with the word "MR" in the fourth line from the bottom on page two and ending with the word "Yes" on the last line of the third page; and

(2) substitute for that part of the decision set aside a decision that Documents 1 to 341, 576, 577, 579 and 583 are not exempt under s 40(1)(d) of the Freedom of Information Act 1982; and

(3) affirm the decision that the passage in Document 579 commencing with the word "MR" in the fourth line from the bottom on page two and ending with the word "Yes" on the last line of the third page is exempt under s 40(1)(d) of the Freedom of Information Act 1982;

1. in so far as the respondent's decision dated 16 August 2004 decides that Documents 241 and 638 are exempt under s 45 of the Freedom of Information Act 1982:

(i) a submission made by Taylor Woodings to ASIC regarding the Financial Reporting and Meeting Obligations of Companies in Administration;

(ii) the content of the fifth column of the table prepared by the respondent summarising the responses to questions in the Discussion Paper;

(iii) the last four lines on the second page of Document 241, beginning "· Again" and the first ten lines on the third page, ending with the word "website";

(b) Document 577 but only in relation to the passage beginning with the word "You" and ending with the word "position"; and

(2) in relation to that part of the decision that relates to documents in Document 241 other than the submission made by Taylor Woodings to ASIC regarding the Financial Reporting and Meeting Obligations of Companies in Administration:

(b) substitute a decision that documents in Document 241 other than:

(i) the submission made by Taylor Woodings to ASIC regarding the Financial Reporting and Meeting Obligations of Companies in Administration;

(ii) the content of the fifth column of the table prepared by the respondent summarising the responses to questions in the Discussion Paper; and

(iii) the last four lines on the second page of Document 241, beginning "· Again" and the first ten lines on the third page, ending with the word "website";

are not exempt under s 45 of the Freedom of Information Act 1982;

1. in so far as the respondent's decision dated 16 August 2004 decides that Documents 1-3, 5-7, 17, 23-24, 36-41, 46-49, 52, 53-58, 61, 65-66, 68-69, 72-73, 85, 87, 90-92, 96, 98-100, 104-107, 109, 111-112, 117-121, 123-124, 126, 128-131, 132, 133, 134, 135, 136-139, 142-144, 148, 150, 153, 158-159, 165, 167-169, 176, 181, 186, 188, 190, 191, 193, 194, 195,196, 199, 204-205, 218-219, 230, 232, 235, 240, 242, 251-254, 269, 276, 283, 321, 340, 577, 579 and 638 are exempt under s 42 of the Freedom of Information Act 1982:

(1) set aside that part of the decision that relates to the following documents or parts of documents:

41 in relation to the third sentence of [7] on page 3 and all but the third sentence of [3] on page 6;

66 in relation to the whole of the document other than the sentence on page 9 beginning with the word "Stephen";

85 in relation to dot point 1 in the last sentence;

90 in relation to [17] on page 5 and [27] on page 8;

104 in relation to the whole of paragraph [7] on page 3 other than the sentence beginning with the word "Before" and the sentence immediately following that sentence;;

105 in relation to the whole of [5] on page 3 other than the first two sentences and [3] on page 6;

107 in relation to the whole of [3] on page 3 other than the first two sentences;

109 in relation to the whole of [2] on page 3 other than the first two sentences;

111 in relation to the whole of [5] on page 2 other than the first two sentences;

112 and 133 in relation to the whole of the document other than the final sentence beginning with the word "The" in [2] and [3] and [4];

117 in relation to the whole of [5] on page 2 other than the first two sentences;

124 in relation to all but the passage beginning immediately following the words "Dear Richard and Rob" on the first page and concluding with the words immediately preceding the words "I shall" on the second page;

128 in relation to the whole of [3] on page 2 other than the last sentence;

130 in relation to the whole document other than the content of the first two dot points and the third dot point on the first page of the attachment to the email;

136 in relation to all but the fifth and sixth lines of substantive text beginning with the word "It" and ending "".";

139 in relation to [5] on page 2 and [25] on page 6;

143 in relation to the whole of the document other than the passage beginning with the words "I have" and concluding with the word "week";

159 in relation to the whole of the document other than the paragraph beginning with the word "Where" and containing one sentence;

165 in relation to the whole of the document other than the email from Mr Gadi Bloch to Mr Brendan Byrne seeking his legal advice, Mr Byrne's email in response and Mr Bloch's request for further legal advice;

167 in relation to the whole of the document other than the email from Mr Gadi Bloch to Mr Brendan Byrne seeking his legal advice;

168 in relation to the whole of the document other than the email from Mr Gadi Bloch to Mr Brendan Byrne seeking his legal advice, and Mr Byrne's email in response;

176 and 199 in relation to the whole of [7] on page 3 other than the last three sentences beginning with the word "This" and [29(c)] on pages 5-6;

186 in relation to the whole of [3] on page 8 other than the first sentence starting with the word "It";

242 in relation to the whole of [7] on page 3 other than the last three sentences of that paragraph and [29(c)] on pages 5-6;

269 in relation to the whole of [3] other than that part of the first sentence beginning with the word "The" and ending with the word "and";

(2) substitute for that part of the decision that relates to the documents or parts of documents identified in 8(1) of this decision a decision that the documents or parts of documents identified in 8(1) are not exempt under s 42 of the Freedom of Information Act 1982; and

(3) otherwise affirm the decision in so far as it relates to exemptions claimed under s 42 of the Freedom of Information Act 1982; and

1. this decision does not come into operation until 30 September 2010.

In a request dated 12 October 2003, Mr Matthews sought access under the Freedom of Information Act 1982 (FOI Act) to a large number of documents in the possession of the Australian Securities and Investments Commission (ASIC). Those documents related, in essence, to the development of ASIC Instrument CO 02/968 (Class Order) and Policy Statement 174 (PS 174) and to ASIC's investigation into Otter Gold Limited (Otter Gold), Allstate Explorations NL (Allstate) and Beaconsfield Gold NL (BCD) excluding documents which are publicly available or which have been circulated to creditors and shareholders_._ He subsequently narrowed the documents he sought to those relating to the Class Order and PS 174. I have set out the precise terms of Mr Matthews' request and its long history in Annexure A to these reasons.[1]

2. Although Mr Matthews narrowed his request, the volume of documents is unwieldy. For the reasons I have given in Annexure B, I have rejected sampling as a possible solution to alleviating the task. Mr Matthews' wish to withdraw part of his application has also given me concern. I have decided that he is not able to withdraw or discontinue part of his application. Instead, I think I should treat Mr Matthews' statement of his position as amounting to consent to my affirming that part of ASIC's decision that relates to all of the documents sought in his initial request and relating to Allstate and associated matters. My reasons are set out in Annexure C.

3. Various parties were joined during the course of the preliminary stages of the application. Among them was Mr Knapp, who made a number of submissions directed to his establishing that the process leading to ASIC's development of PS 174 was an improper process. His submissions led me to consider the role of a party joined and what a review of a decision under the FOI Act can achieve. I set out that consideration in Annexure D to these reasons. Also set out in that Annexure is my understanding of the limitations on the use that the parties can make of evidence given in these proceedings. I have done this in response to questions that were raised by

Mr Matthews and Mr Knapp during the course of the hearing.

4. As Mr Matthews and Mr Knapp queried the adequacy of the searches, I have considered that issue and have decided that they were adequate. My reasons are set out in Annexure E.

5. Set out in Annexure F is the background to the documents relating to ASIC's policy deliberations and the request in so far as it relates to Allstate. Reference is also made to ASIC's wide range of powers and functions in relation to monitoring and promoting market integrity and consumer protection of the financial and payment systems in Australia. In Annexure G to these reasons I note that, under s 341 of the Corporations Act, ASIC may make an order in respect of a specified class of companies, registered schemes or disclosing entities, relieving certain persons or entities from certain requirements. It may act on its own initiative without application being made to it. The persons who may be relieved of specified obligations are directors, the companies, registered schemes or disclosing entities themselves and auditors of those companies, registered schemes or disclosing entities.[2] The requirements in respect of which ASIC may give relief are all or any of those specified in Parts 2M.2, 2M.3 and, except in relation to Division 4, Part 2M.4. The order may be expressed to be subject to conditions and may be either indefinite or limited to a specified period.[3] A list of staff involved in the deliberations to some extent and taken from Exhibit JDP-2 to Mr Price's affidavit, Exhibit 3, appears at Annexure H to these reasons.

6. I have considered ASIC's claims for exemption under ss 36, 37, 40, 41, 42 and 45. I have decided that, except in relation to one passage in Document 579 setting out information obtained by ASIC under compulsion, the claims made ss 36 and 40 are not supported in relation to any of the documents. In relation to the claims for exemption under s 42 on the basis of legal professional privilege, I have decided that exemption may be claimed where communications, otherwise protected by the privilege, involve external Counsel or ASIC officers within its Office of General Counsel (OGC) but may not be claimed in respect of legal advice obtained from, given by or exchanged among ASIC officers who also hold legal qualifications.

A claim was also made under s 43(c)(ii) in relation to a submission made on a confidential basis and forming part of Document 241 and under s 41 in relation to Document 638, which is the submission forming part of Document 241. I have not considered either claim for I am satisfied for reasons I give later in these reasons that both documents are exempt under s 45. A claim for exemption was also made under

s 37(1)(b) and 37(2)(b) in relation to Documents 577, 579 and 583. I have decided that none of the three documents is exempt under s 37(2)(b) but that parts of Document 579 are exempt under s 37(1)(b) in so far as it would disclose the identity or existence of confidential sources of information.

7. I have set out the exemption provisions in the body of these reasons. My decisions relating to the claims for those exemptions in relation to particular documents are set out in the Annexures as follows. References to the paragraphs in which the section and general principles of law relating to it are set out are shown in brackets. Further principles of law are also considered in the Annexures as they relate to particular documents:

Substantial adverse effect on proper and efficient conduct of operations of agency

42 (including deletion of exempt matter under s 22 at [351]-[364]

8. My decision is set out in Annexure N at [478]. It is framed in terms of whether or not the documents are exempt under the FOI Act rather than whether or not Mr Matthews should be granted access to them. I have done that deliberately for the legally enforceable right to obtain access is subject to all the provisions of the FOI Act and not simply those in Part IV relating to exemptions. Among those provisions is s 29 which relates to charges. That section must be read with the Freedom of Information (Fees and Charges) Regulations made under s 94 of the FOI Act. Liability to pay charges is determined under those Regulations. If Mr Matthews is liable to pay a charge, in most circumstances he must pay that charge before ASIC gives him access to the documents.[4] He may contend that any charges should be reduced and he has rights to apply to ASIC and ultimately the Tribunal regarding the imposition of charges and their amount.[5] These are not matters that I have power to review in this matter but they remain matters to be resolved between Mr Matthews and ASIC. Under s 43(5B) of the Administrative Appeals Tribunal Act 1975 (AAT Act), I have also deferred the date on which the decision is to come into effect until

30 September 2010. This will allow ASIC time within which to lodge any appeal it may wish to make to the Federal Court under s 44 of the AAT Act.

9. In interpreting the various exemption provisions, I am mindful of the words of Bowen CJ and Fisher J in The News Corporation Ltd v National Companies and Securities Commission[6] who said, after considering authority that provisions of the American Freedom of Information Act 5 USC 552 concerning access should be generously construed while exemptions are to be narrowly construed:

" In construing our Act we do not favour the adoption of a leaning position. The rights of access and the exemptions are designed to give a correct balance of the competing public interests involved. Each is to be interpreted according to the words used, bearing in mind the stated object of the Act."[7]

"Subject to this section, a document is an exempt document if it is a document the disclosure of which under this Act:

(a) would disclose matter in the nature of, or relating to, opinion, advice or recommendation obtained, prepared or recorded, or consultation or deliberation that has taken place, in the course of, or for the purposes of, the deliberative processes involved in the function of an agency or Minister or of the Government of the Commonwealth; and

11. The section is qualified in two ways. First, it does not apply to a document by reason only of purely factual material contained in the document:

s 36(5). Second, it does not apply to matter used for the purpose of making decisions or recommendations referred to in s 9(1)(a): s 36(2). Where a decision is made to deny access to a document on the basis that the exemption in s 36 applies, the reasons given under s 26 must state the ground of public interest on which the decision is based.[8]

12. Cases that have considered s 36(1)(a) have included Re Howard and Treasurer of the Commonwealth of Australia,[9] Re Murtagh and Commissioner of Taxation,[10] Re Waterford and Department of the Treasury (No.2),[11] Re James and Others and Australian National University[12] and Kavvadias v Commonwealth Ombudsman (No 2).[13] In so far as those cases considered the word "deliberation", their conclusion may be summarised in the words of Beaumont J in Harris

v Australian Broadcasting Corporation and others[14] when he said that:

"... 'deliberation' suggests not only collective discussion but collective acquisition and exchange of facts preliminary to ultimate decision."[15]

Sheppard J's observation in Kavvadias v Commonwealth Ombudsman is also pertinent and that is to the effect that the expression is not to be confined to policy making.[16]

13. Matter in the nature of a deliberation is not the only matter within the scope of s 36(1)(a). Other matters within its scope are matters in the nature of "opinion, advice or recommendation ... [or] consultation". In the case of Smith and Aboriginal and Torres Strait Islander Commission,[17] I set out the ordinary meanings of the other words used in s 36(1)(a) i.e. "opinion, advice or recommendation ... [and] consultation:"

"Taking first the word 'opinion_', it connotes '... a view held about a particular subject or point; a judgement formed; a belief ...' (The New Shorter Oxford English Dictionary, 1993) or a '1. judgment or belief resting on grounds insufficient to produce certainty. 2. a personal view, attitude, or estimation: public opinion 3. the expression of a personal view, estimation, or judgment: to give an opinion on tariffs. 4. a formal or professional judgment expressed, especially in law: counsel's opinion. ...' (The Macquarie Dictionary, 3rd edition, 1997). The word 'advice' means '... The way in which a matter is looked at; opinion, judgement ... consideration, consultation, reckoning ... an opinion given or offered as to action; counsel ... The result of consultation; determination, plan ...' (The New Shorter Oxford English Dictionary, 1993 and see also_ The Macquarie Dictionary_, 3rd edition, 1997) . The meanings of 'recommendation' include '... The action or an act of recommending a person or thing; a recommended course of action etc.; a proposal ...' (The New Shorter Oxford English Dictionary, 1993 and see also_ The Macquarie Dictionary_, 3rd edition, 1997). To a certain extent, the meanings of the words 'opinion', 'advice' or 'recommendation' overlap. Whether they overlap or not, all are expressing the notion of consideration followed by the formation of a view either about a certain subject or about a course of action and the transmission of that view._

The ordinary meanings of 'consultation' include '... A meeting in which parties consult together, or one person consults another, ... ' (The New Shorter Oxford English Dictionary, 1993) and '... the act of consulting; conference. ... a meeting for deliberation ... an application for advice to one engaged in a profession ...' (The Macquarie Dictionary, 3rd edition, 1997). Again, there is a notion of consideration inherent in the meaning of 'consultation'. That consideration may or may not lead to the formation of an opinion, advice or recommendation.

Similarly, the word 'deliberation' encompasses the notion of consideration. That consideration may involve consultation or discussion amongst more than one persons. Equally, a person who considers a matter on his or her own can be said to have deliberated upon it. Whether or not the deliberation leads in either case to the formation of an opinion, advice or recommendation is another matter."[18]

14. On its face, s 36(1)(a) appears to be broadly drafted to gather a broad range of matters within its scope and, with one exception, there is no reason in the context either of the remainder of the section or of the FOI Act to limit the ordinary meanings given to the words "opinion, advice or recommendation ... consultation or deliberation". In Booker and Department of Social Security,[19] I gave further consideration to the word "consultation" and, after reviewing various authorities, added that "...in order for there to be a consultation, there must be something of a two way exchange between at least two parties. ...".[20]

15. That brings me to the qualification expressly stated in s 36(1)(a)

to limit the meaning that must be given to the words "opinion, advice or recommendation" and also to the words "consultation or deliberation". That qualification is that it must have been "obtained, prepared or recorded" (if an opinion, advice or recommendation) or "ha[ve] taken place" (if a consultation or deliberation) "in the course of, or for the purposes of, the deliberative processes involved in the functions of an agency ...".

16. The meaning of the expression "taken place" seems clear enough but what of the words "obtained, prepared or recorded"? The word "obtain" was considered by Newman J in Kelly v JRA Ltd[21] in the context of s 234(1)(b) of the Customs Act 1901. That section provided, in part, that "A person shall not ...obtain any ... refund ... which is not payable". His Honour said:

"... The word 'obtain' is defined by the Shorter Oxford English Dictionary as being 'to procure or gain, as a result of purpose and effort ... to possess'.

The Macquarie Dictionary showing consistency with its English counterpart, defines 'obtain' as 'to come into possession of; get or acquire; procure as by effort or request.' In my view the action required of a person to come into possession of a refund of duty from the Collector of Customs requires, on that person's part, a conscious effort to receive a refund evidenced by the fact that to get such refund, the person seeking it must actively do something to get it."[22]

17. It seems to me that a similar meaning should be given to the word "obtain" as it is used in s 36(1)(a). The opinion, advice or recommendation must have been acquired or procured in the course of, or for the purposes of, its deliberative processes involved in its functions. It is not enough that the opinion, advice or recommendation was received by an agency when it was not sought by that agency either explicitly or implicitly.

18. The remaining words to consider are "prepared" and "recorded". Their meanings are clear and, given their context, it is equally clear that the opinion, advice or recommendation must have been "prepared or recorded" in, or for the purposes of collective discussions i.e. the deliberative processes. At one time, it would generally have been expected that the opinion, advice or recommendation would be prepared or recorded within the agency. It could always be envisaged, though, and it has now become more common for an agency to ask a person outside it to prepare or record the opinion, advice or recommendation. Provided it is prepared or recorded with the imprimatur of the agency and that the other criteria in s 36(1)(a) have been met, the opinion, advice or recommendation would come within the paragraph. It is not enough, though, that it has been prepared or recorded and then proffered to the agency. To come within the paragraph, it must have been prepared or recorded in the course of, or for the purposes of, the agency's deliberative processes and so the opinion, advice or recommendation must have been prepared or recorded as a result of the agency's seeking it rather than its simply being the recipient of it.

19. Perhaps their meanings are self explicit but I should also spend a moment on the meaning of the words "in the course of" and "for the purposes of" the deliberative processes "involved in" the functions of an agency, Minister or Government of the Commonwealth as they appear in s 36(1)(a). In order to claim an exemption under s 36, it is not enough that the agency or Minister has a document containing an opinion, advice or recommendation or consultation or deliberation referring to matters for which the agency or Minister has responsibility. It must be matter of that sort that has been obtained, prepared or recorded or, in the case of a consultation, has taken place in the course of, or for the purposes of the deliberative processes involved in their functions.

20. In the context of s 6 of the Contracts Review Act 1980 (NSW), Young J considered the meaning of the expression "for the purpose of a trade, business or profession'. His Honour did so in Ellison v Vukicevic[23] when he adopted what Lee J had said in Collins v Parker:[24]

" The expression 'for the purpose of' has the meaning that the contract under consideration is entered into as an ordinary incident of the carrying on of a particular trade, business or profession then being carried on or proposed to be carried on."[25]

It seems to me that this interpretation is equally apt in s 36(1)(a) of the FOI Act. If matter has been obtained "for the purposes of" deliberative processes, it must have been obtained as an ordinary incident of them.

21. The expression "in the course of" raises similar issues of connectivity between the particular matter and the deliberative processes. Those issues are of the same sort as those that arise when considering whether an injury has occurred "in the course of employment". Deane J considered them in Commonwealth of Australia v Lyon[26] when said:

" Injury in the course of employment means an injury sustained while the worker is engaged in the work which he is employed to do or in something which is a concomitant of, or reasonably incidental to, his employment to do that work ... The course of employment is a temporal concept and it is unnecessary that there be any causal connection between the work which the employee is employed to do and the injury which he sustains ... The scope of what is within it depends upon 'the sufficiency of the connection between the employment and the thing done by the employee' which 'cannot but remain a matter of degree, in which time, place and circumstances, as well as practice, must be considered together with the conditions of employment' (per Dixon J, Whittingham v Commissioner of Railways (WA) [1931] HCA 49; (1931) 46 CLR 22 at 29, and see, generally, per Stephen J Bill Williams Pty Ltd v Williams [1972] HCA 23; [1972-73] ALR 303; 126 CLR at 158-9."[27]

22. There are, of course, later authorities concerned with what is meant by an injury "in the course of employment". One of these is Hatzimanolis v ANI Corporation Ltd [28] in which Mason CJ, Deane, Dawson, Toohey and McHugh JJ said:

"... In determining whether the injury occurred in the course of employment, regard must always be had to the general nature, terms and circumstances of the employment 'and not merely to the circumstances of the particular occasion out of which the injury to the employee has arisen ...[[29]]'."[30]

That, too, is a principle that is equally applicable in considering whether a matter of the sort described in s 36(1)(a) has been obtained, prepared or recorded or a consultation or deliberation has taken place in the course of the deliberative processes involved in the functions of an agency, a Minister or the Government of the Commonwealth. Regard must be had to the general nature, terms and circumstances of those deliberative functions.

23. It follows that there must be a connection of the sort described between the opinion, advice or recommendation or of the consultation or deliberation and the deliberative processes of an agency. That, however, is not the only connection that must be made for the purposes of s 36(1)(a). There must be a connection of the sort described by the expression "involved in" between the deliberative processes and the functions of an agency, a Minister or the Government of the Commonwealth. What is the nature of that connection? The word "involve" means in this context:

"... to require as a necessary part ..."[31]

Therefore, the deliberative processes must be those that are required as a necessary part of the functions of the agency, Minister or the Government of the Commonwealth.

24. The expression "deliberative processes" has been considered in

Re James and Others and Australian National University in which Deputy President Hall repeated the view he had expressed as a member of the Tribunal in Re Waterford and Department of the Treasury (No.2) that the "deliberative processes" of an agency are its "thinking processes".[32] Sheppard J stated in Kavvadias v Commonwealth Ombudsman that the expression is not to be confined to policy making.[33] Several authorities were reviewed by Davies J in Re Howard and Treasurer of the Commonwealth of Australia.[34] He referred to Re Murtagh and Commissioner of Taxation, with which he agreed and in which the Tribunal had said:

"The term 'deliberative processes' would seem to have a wide ambit.

The term was considered by Beaumont J in Harris v Australian Broadcasting Corporation [1983] FCA 242; (1983) 50 ALR 551. At 560, his Honour said that: '... "deliberation" suggests not only collective discussion but collective acquisition and exchange of facts preliminary to ultimate decision.'"[35]

25. Davies J referred also to the Tribunal decision in Re Waterford and Department of the Treasury (No.2) where it said:

"As a matter of ordinary English the expression 'deliberative processes' appears to us to be wide enough to include any of the processes of deliberation or consideration involved in the functions of an agency. 'Deliberation' means 'The action of deliberating: careful consideration with a view to decision': see The Shorter Oxford English Dictionary_. The action of deliberating, in common understanding, involves the weighing up or evaluation of the competing arguments or considerations that may have a bearing upon one's course of action. In short, the deliberative processes involved in the functions of an agency are its thinking processes - the processes of reflection, for example, upon the wisdom and expediency of a proposal, a particular decision or a course of action. Deliberations on policy matters undoubtedly come within this broad description. Only to the extent that a document may disclose matter in the nature of or relating to deliberative processes does s36(1)(a) come into play._"[36]

26. This passage was considered by Deputy President McDonald in

Re Chapman and Minister for Aboriginal and Torres Strait Islander Affairs.[37] He then said:

" In reaching a decision to characterise a document as being part of a deliberative process the tribunal may seek guidance, but not be bound, by the wording used in the document itself. The determination should be based on a fair reading of the whole of the document and not a disjunctive reading of selected passages. Additionally, the characterisation should be determined not only by having regard to the wording used in the document, but also by reference to the surrounding circumstances and the matters deposed to in any evidence supporting the maintenance of the exemption. ..."[38]

27. While I would not disagree that the whole of any document should be read before coming to a decision, I would disagree with any suggestion, if there be any, that the whole of the document will always be relevant. The occasions on which the whole of the document will not be relevant may be few but the fact that they may occur should be borne in mind. They may, for example, appear in a document that cannot itself be described as a document whose disclosure would reveal matter that would otherwise come within the scope of s 36(1)(a). That this may be so is underlined by the provisions of s 22(1) of the FOI Act in so far as it contemplates the possibility that exempt matter may be deleted from a document so that it is no longer an exempt document. Subject to certain conditions, s 22 permits access to be given to a document that has been redacted in that way.

B.2 The qualification in s 36(5): purely factual material

28. The expression "purely factual material" was considered by Deputy President Todd in Re Waterford and Treasurer of the Commonwealth (No 1).[39]

He concluded "... that to be described as 'factual' the material must be 'factual' in fairly unambiguous terms. ..."[40] As for the word "purely", it "... is clearly not used to denote something about the character of what is comprised in 'factual material'. It has the sense of 'simply' or 'merely' ...".[41] Although it may be more a matter of semantics than of substance, I would approach the matter from a slightly different view of the role of the word "purely". In my view, it is intended to emphasise that the material must be "... wholly ...[or] entirely ..."[42] comprised of factual material and cannot incorporate any material that is not factual material. As Deputy President Todd would say: it comprises merely or simply factual material. It does not contain material that can be described as opinion, advice or recommendation or even conjecture.[43]

29. The distinction was drawn by the Full Court of the Federal Court in Harris v Australian Broadcasting Commission:[44]

" Equally, some conclusions may be classed as purely factual material. We hesitate to import notions from the law of evidence into this field. However, it may be useful to refer to the distinction, with which lawyers are familiar, between primary facts and ultimate facts. In our view a statement of ultimate fact may be a statement of purely factual material, notwithstanding it involves a conclusion based on primary facts. Many common statements of fact may, if analysed, be found to be based on primary facts. For example, the statements X has a cold or Y resides in Sydney are both statements based on primary facts, which are unstated. On the other hand, a conclusion which involves opinion, advice or recommendation for the purposes of the deliberative process may well prevent material from being purely factual and render it exempt."[45]

B.3 The qualification in s 36: matter used for the purpose of making decisions or recommendations referred to in s 9(1)(a)

30. Section 9(1)(a) refers to matter used for the purpose of making decisions or recommendations referred to in s 9(1)(a). Those are "manuals or other documents containing interpretations, rules, guidelines, practices or precedents ..." and must be made available for inspection and purchase in accordance with s 9. Although it may be that Document 312A contains the final draft of the content of what was to become PS 174, it is not the final copy that was available for use by ASIC officers in making decisions or recommendations under the Corporations Act. The document does not bear a PS number, its issue date is blank and the list of related instruments is incomplete. Therefore, the qualification in s 36(1)(a) is irrelevant.

B.4 Section 36(1)(b): "contrary to the public interest"

31. If a document comes within the scope of s 36(1)(a) and is not excluded by one or other of the exceptions in ss 36(5) or (6), it will not be exempt unless its disclosure under the FOI Act would be contrary to the public interest. What is meant by "contrary to the public interest" in s 36(1)(b) was considered by the High Court in McKinnon v Secretary, Department of the Treasury (McKinnon).[46] Before I come to that, I have found it helpful to look at earlier authorities considering the meaning of "public interest" in other contexts.

32. In the different context of defamation law, Lord Denning said in London Artists Ltd v Littler:[47]

"... There is no definition in the books as to what is a matter of public interest. All we are given is a list of examples, coupled with the statement that it is for the judge and not for the jury. I would not myself confine it within narrow limits. Whenever a matter is such as to affect people at large, so that they may be legitimately interested in, or concerned at, what is going on; or what may happen to them or to others; then it is a matter of public interest on which everyone is entitled to make fair comment. A good example is South Hetton Coal Co Ltd v North-Eastern News Association Ltd [1894] 1 QB 133.

A colliery company owned most of the cottages in the village. It was held that the sanitary conditions of those cottages - or rather their insanitary condition - was a matter of public interest. Lord Esher MR, said at p 140, that it was "a matter of public interest that the conduct of the employers should be criticised". There the public were legitimately concerned_. Here the public are legitimately_ interested_. Many people are interested in what happens in the theatre. The stars welcome publicity. They want to be put at the top of the bill. Producers wish it too. They like the house to be full. The comings and goings of performers are noticed everywhere. When three top stars and a satellite all give notice to leave at the same time - thus putting a successful play in peril - it is to my mind a matter of public interest in which everyone, press and all, are entitled to comment freely._"[48]

33. In McKinnon v Secretary, Department of Treasury,[49] Tamberlin J said:

"10. The expression 'the public interest' is often used in the sense of a consideration to be balanced against private interests or in contradistinction to the notion of individual interest ...

13. In the context of freedom of information, the notion of 'the public interest' was helpfully considered by the Appeal Division of the Supreme Court of Victoria in Director of Public Prosecutions v Smith [1991] VicRp 6; [1991] 1 VR 63 at 75, where Kaye, Fullagar and Ormiston JJ said:

'The public interest is a term embracing matters, among others, of standards of human conduct and of the functioning of government and government instrumentalities tacitly accepted and acknowledged to be for the good order of society and for the well being of its members. The interest is therefore the interest of the public as distinct from the interest of an individual or individuals: Sinclair v Mining Warden at Maryborough [1975] HCA 17; (1975) 132 CLR 473 at 480, per Barwick CJ. There are ... several and different features and facets of interest which form the public interest.'

14. The expression 'the public interest' was also the subject of consideration by Lehane J in Botany City Council v Minister for Transport and Regional Development [1996] FCA 1507; (1996) 137 ALR 281 at 308, again in an administrative law context, where his Honour said:

_'_I think it is clear that the principal public interest to which the second respondent was giving expression was an interest in ... the equitable or fair distribution of the noise necessarily associated with an airport close to the centre of a large city; and his view was that that public interest required dispersal of the noise rather than its concentration in

a narrow corridor. ... Others might ... take a different view of what the public interest required. A decision between competing views is not, however, a matter for the court. What the court has to decide is whether the second respondent's reasons disclose reviewable error, particularly, a misconstruction on his part of the expression "the public interest". In my view they do not.'

15. His Honour also referred to the statement by Mason CJ, Brennan, Dawson and Gaudron JJ in O'Sullivan v Farrer [1989] HCA 61; (1989) 168 CLR 210 at 216 that:

'Indeed, the expression "in the public interest", when used in a statute, classically imports a discretionary value judgment to be made by reference to undefined factual matters, confined only "in so far as the subject matter and the scope and purpose of the statutory enactments may enable ...'"

See also Water Conservation and Irrigation Commission v Browning [1947] HCA 21; (1947) 74 CLR 492 at 505 and In re Thompson (1964) Tas SR 129 at 143-144.

34. What is clear from these cases is that the public interest is not a static concept. It is, instead, a concept that takes its shape and substance from the circumstances which are said to give rise to it. Those circumstances will be factual and statutory. In Botany City Council v Minister for Transport and Regional Development,[50] for example, the factual circumstances were the airport, the noise it generated and the effect of noise on people. In London Artists Ltd v Littler, the factual circumstances were the sanitary conditions and their provision by an employer.

35. This seems to accord with the approach taken in a decision of Davies J as President of the Tribunal in Re Howard and Treasurer of Commonwealth of Australia.[51] He was concerned with a conclusive certificate and so with whether there existed reasonable grounds for a claim that disclosure of certain documents would be contrary to the public interest. Mr Howard had requested documents provided to the then Government by an Australian Council of Trade Unions' (ACTU) Task Force during the formulation of the 1984/85 Budget. When in opposition, the Government had forged an Accord with the ACTU regarding economic policy. In particular, the Government had agreed to consult with the ACTU regarding income and prices policies including taxation. Access was refused to a minute to the Treasurer and a telex to the ACTU. Both documents advised the Treasurer on the implications and estimated cost of certain taxation options. Davies J referred to previous authorities from which he gleaned that the whole of the circumstances needed to be examined. Those circumstances included any public benefit perceived in their disclosure.[52] As general propositions, he drew five propositions to which I referred in Re McKinnon and Secretary, Department of Prime Minister and Cabinet.[53]

36. Mr Howard had framed his submissions around three points. First, the Accord was a political document. Second, the ACTU had not produced any evidence as to whether maintaining the confidentiality of their discussions was important to them. Third, there is a clear public interest in not only the reality, but the appearance, of equal treatment of claimant groups and their representatives in the Australian community. The Government of the day had appeared, Mr Howard submitted, to have treated the ACTU in a special manner. Davies J dealt with these submissions and analysed the evidence in a way consistent with the approach that appears to underpin the judgments, to which I have referred, and to that of the High Court in McKinnon to which I will refer shortly:

" _In the present case, I think there were and are reasonable grounds for concluding that disclosure of the documents would be contrary to the public interest. In the preparation of the Budget, the Treasurer and officers of his Department would have given consideration to a wide range of options. Some options would have been noted and not further considered, others may have been given scant attention. Some options may have been given serious consideration but not adopted for one reason or another. In the course of the development of the Budget, new options may have come to light. In the end, the Budget would have been formulated. The authorities to which I have referred recognize a public interest in protecting from disclosure such a process of deliberation. Protection of the deliberative process encourages 'creative debate and candid consideration of alternatives', to use the words of Wilkey J (_Jordan v Department of Justice, supra, [591F (2d) 753 (1978)] at 772). It prevents premature disclosure of possible options and confusion arising between options considered and options adopted. And lastly it protects the integrity of the decision-making process by enabling the government to be judged by what it has decided to do rather than by material it has taken into account. These elements of the public interest are as significant in this country as they are in the United States or in the United Kingdom."[54]

37. This brings me to the approach taken by the High Court in McKinnon. Although considering a conclusive certificate that had been issued in relation to a claim that disclosure of certain documents would be contrary to the public interest within the meaning of s 36(1)(b), some mention was made of the general notions of public interest in their Honour's judgments. There were three different approaches in the three judgments in McKinnon.

38. Gleeson CJ and Kirby J examined the object of the FOI Act, the structure of s 36 and its place in the legislation. They continued:

" A conclusion that disclosure of an internal working document would be contrary to the public interest may or may not turn upon contestable facts: either primary facts, or inferences to be drawn from those facts. It may or may not turn upon contestable matters of opinion. Inevitably, it will involve a judgment as to where public interest lies. Such judgment, however, is not made in a normative vacuum. It is made in the context of, and for the purposes of, legislation which has the object described above, which begins from the premise of a public right of access to official documents, and which acknowledges a qualification of that right in the case of necessity for the protection of essential public interests (s 3(1)(b))."[55]

39. Their Honours' reference to the fact that "judgment" is required in determining where the public interest lies and to that judgment's being made in a particular context found expression in a later passage in their judgment:

"... This is a concept that assumes prominence in a different context, in which courts are required to deal with claims of public interest immunity advanced in opposition to the production of documents, for example under subpoena, in civil or criminal litigation. There, it is the public interest in the administration of justice, and considerations of fairness to litigants, that may need to be weighed against aspects of the public interest put at risk by disclosure of documents .... The image of the scales of justice is pervasive in legal thinking, and it is natural to talk of taking account of competing considerations in those terms. Under the FOI Act, however, the matter of disclosure or non-disclosure is not approached on the basis that there are empty scales in equilibrium, waiting for arguments to be put on one side or the other. There is a 'general right of access to information ... limited only by exceptions and exemptions necessary for the protection of essential public interests [and other matters not presently material]' (s 3(1)(b)). That is the context in which a minister makes a decision under s 36(3), and in which such a decision is reviewed under s 58(5). References to 'balancing' create a danger of losing sight of that context. ..."[56]

40. Gleeson CJ and Kirby J were in the minority on the final result but their views are not incompatible with those of Hayne J, who was a member of the majority. Hayne J made the following observations on the meaning of "public interest":

" It may readily be accepted that most questions about what is in 'the public interest' will require a consideration of a number of competing arguments about, or features or 'facets' of, the public interest. As was pointed out in O'Sullivan v Farrer ...[[57]]:

'[T]he expression "in the public interest", when used in a statute, classically imports a discretionary value judgment to be made by reference to undefined factual matters, confined only "in so far as the subject matter and the scope and purpose of the statutory enactments may enable ... given reasons to be [pronounced] definitely extraneous to any objects the legislature could have had in view" ...[[58]].

That is why a question about 'the public interest' will seldom be properly seen as having only one dimension."[59]

41. In contrast to these expressions of the public interest, Callinan and Heydon JJ made the following observations regarding the public interest:

" Nor are we by any means certain that it is apt to describe the public interest as multifaceted. Neither the fact that different people will see it through different prisms, nor the fact that an all-encompassing definition of it for all occasions is not possible, means that the public interest is multifaceted. ... Judges have usually not found it necessary to direct juries at length as to the meaning of the expression, except to warn them that it is not enough that the matter might be of some personal or prurient interest, or merely something about which they may be curious."[60]

42. The conclusion to be drawn is that the public interest is not multifaceted but a concept which shapes itself to the factual circumstances under consideration and any statutory provisions applicable to those circumstances for its very dimensions and boundaries are drawn by those circumstances and provisions. That is illustrated by the judgment of Gleeson CJ and Kirby J who note that the FOI Act itself begins from the premise of a public right of access to official documents, and which acknowledges a qualification of that right in the case of necessity for the protection of essential public interests.

43. In trying to ascertain the public interest, a distinction must be drawn between the public interest and a matter of interest to the public. In Director of Public Prosecutions v Smith,[61] the Victorian Supreme Court considered a decision made by the former Administrative Appeals Tribunal of Victoria (AATV) to release of documents relating to a decision by the Victorian Director of Public Prosecutions not to prosecute a solicitor on the basis that their release was in the public interest. It had been alleged that the solicitor had been a party to a fraud upon a businessman who was a client of the practice in which the solicitor was then employed. Section 50(4)

of the Freedom of Information Act 1992 (Vic) (FOIVIC) empowered the AATV to override most exemptions[62] where it was of the opinion that the public interest required that access to the document should be granted under that Act. The documents to which the Tribunal granted access contained detailed references to business transactions of the former client, who had begun legal proceedings against the solicitor's firm, complained to the Victorian Law Institute and reported the matter to the police.

44. The beginning of the following passage from the judgment of the Full Court of the Supreme Court of Victoria appears in the extract of the judgment of Tamberlin J in McKinnon v Secretary, Department of Treasury. I have set that passage out above.[63] Omitting citations, I will repeat the beginning in order to set the context in which the Full Court drew a distinction between matters of public interest and matters of interest to the public:

"... The public interest is a term embracing matters, among others, of standards of human conduct and of the functioning of Government and Government instrumentalities tacitly accepted and acknowledged to be for the good order of society and for the well being of its members. The interest is therefore the interest of the public as distinct from the interest of an individual or individuals: ... There are ... several and different features and facets of interest which form the public interest. On the other hand, in the daily affairs of the community events occur which attract public attention. Such events of interest to the public may or may not be ones which are for the benefit of the public; it follows that such form of interest per se is not a facet of the public interest. The interest created by Mr Legge bringing his business transactions into the public arena and by the respondent's public statements concerning the prosecution of McArdle were no doubt of the nature of the interest to some members of the public, but those matters were not 'the public interest' to which s 50(4) is directed."[64]

45. There were, however, two other matters that the AATV, constituted by Judge Higgins, had considered to be relevant in considering public interest. They were the interest of the public that the prosecution of Mr McArdle had been effected impartially and according to law and the public interest inherent in the doctrine of legal professional privilege. The Full Court upheld the AATV's decision to release the documents saying:

"... His Honour commenced by accepting without elaboration the high order of importance of the privilege against which he compared the public interest factor of the appearance of justice having been done in exceptional circumstances which had been created to surround the McArdle case. Then he recounted matters and considerations pertinent to the public interest in the appearance of justice having been done. His opinion that the public interest required the disclosure to the public of the exempt documents was reached after comparing the benefit to the criminal justice system by disclosure against the harm to the doctrine of legal professional privilege. To the lawyer steeped in the tradition of the common law, the result may seem unacceptable. Nevertheless the legislature, by not excluding from the operation of s. 50(4) a document referred to in s. 32 indicated the intention that in appropriate circumstances other factors of the public interest might be attributed greater value than the factor of legal professional privilege. Be that as it may, the reasons for his decision were given by the learned judge in conformity with the requirement of s. 49(1) to (3) of the Administrative Appeals Tribunal Act."[65]

46. This approach is consistent with that of Hayne J in McKinnon to the effect that what is in the public interest and so, in a case such as this, what is contrary to the public interest, requires a consideration of a number of matters. That is not to say that the public interest is multi faceted. The matters that are taken into account are confined only in so far as the subject matter and the scope and purpose of the relevant enactment require.

47. Among those matters must be the right of access to information conferred by the FOI Act. The rights to access to information in documentary form under Parts II and III are not limited to "citizens" if, by that word, I am meant to understand "Australian citizens". The right given by s 11, as opposed to the object stated in s 3(1), is expressed more broadly in terms of every person's having a legally enforceable right and it has been interpreted more widely without reference to Australian residence or citizenship.[66]

48. A purpose of the FOI Act is to inform persons about the processes of government but it is not the only purpose. It could be said that it does this under Part II and that Part II is the implementation of the object expressed in s 3(1)(a):

"The object of this Act is to extend as far as possible the right of the Australian community to access to information in the possession of the Commonwealth by:

(a) making available to the public information about the operations of departments and public authorities and, in particular, ensuring that rules and practices affecting members of the public in their dealings with departments and public authorities are readily available to persons affected by those rules and practices; ...

Consistently with this object, s 8 requires agencies to publish certain information about their functions, the categories of documents they maintain and the opportunities that exist for persons or bodies outside the Commonwealth administration to participate in the formulation of policy. Unlike requests for access under Part III, which are limited to requests for information in documentary form, s 8 requires agencies to create documents setting out the relevant information if they do not already exist. Section 9 requires them to make available for inspection and purchase documents that they use in their decision-making processes. All of this informs about the processes of government.

49. The rights given under Part III are not necessarily so limited. When read with the exemptions in Part IV, they appear to be the implementation of the object stated in s 3(1)(b) to create:

"... a general right of access to information in documentary form in the possession of Ministers, departments and public authorities, limited only by exceptions and exemptions necessary for the protection of essential public interests and the private and business affairs of persons in respect of whom information is collected and held by departments and public authorities."

"Subject to this Act, ... a legally enforceable right to obtain access in accordance with this Act to:

(a) a document of an agency, other than an exempt document; or

(b) an official document of a Minister, other than an exempt document."

As s 11(2) goes on to say, subject to the FOI Act itself, a person's right of access is not affected by any reasons given by the person seeking access or any belief held by an agency or Minister as to the person's reasons for seeking access.

51. It is clear from the way in which s 3(1)(b) expresses its object to create a general right of access that the government holds a wide range of information in documentary form. No doubt all of that information is in some way relevant to a function, a power or a duty of an agency but not all of it may in itself disclose the processes of government. A wish to know about the processes of government may or may not be at the heart of a request for access.[67] Given the object of the FOI Act and the nature of the right of access it confers, it seems to me that the public interest is in maintaining that right of access limited as it is only by exemptions necessary to protect private and business affairs of persons in respect of whom information is collected by departments and public authorities and by what is necessary for the protection of essential public interests. Those essential public interests are circumscribed by the exemption provisions of Part IV and, to some extent, by the workload considerations set out in s 24 of Part III that justify refusal of a request. This public interest could also be described in the words adopted by Tamberlin J in McKinnon v Secretary, Department of Treasury as "transparency in public administration"[68] if that expression were understood to encompass transparency of information held in documentary form as well as transparency of processes. That would seem a more appropriate expression of this consideration in determining what is contrary to the public interest under s 36(1)(b) than that of citizens' being informed of the processes of government.

52. Section 36(1)(b) does not purport to limit the matters taken into account by reference only to the essential public interests that it has protected in Part IV. That is clear from the paragraph itself and underlined by s 32(a) which provides that:

"A provision of this Part by virtue of which documents referred to in the provision are exempt documents:

(a) shall not be construed as limited in its scope or operation in any way by any other provision of this Part by virtue of which documents are exempt documents;...

53. As submitted on behalf of ASIC, there is a public interest in the proper working of government but what does that mean? I have turned to the judgment of Callinan and Heydon JJ for assistance. Their Honours went on to consider the various grounds of public interest that had been claimed by the respondent in that case and said:

" ... The reference to 'ongoing sensitivity' in the first is not entirely clear. We would be inclined ourselves to think that the fact that documents have continuing sensitivity, are controversial and affect a minister's portfolio would not alone provide a reasonable ground for continuing confidentiality. The use of the word 'ongoing' strongly suggests currency, and the use of the word 'controversial' might well at least imply public interest.

The second ground, which speaks of jeopardy to candour, and the desirability of written communications, obviously cannot readily be dismissed, and it seems to us that this is a matter upon which a minister's opinion and experience are likely to be as well informed and valuable as those of anyone else, including senior officials.

The third ground raises an issue of tentativeness, that is to say, that the documents were concerned with matters that were not settled and recommendations that were not adopted. This too, on its face, is a cogent ground. It is difficult to see how it would not be reasonable for a minister to take the view that the release of material of that kind would not make a valuable contribution to public debate.

The fourth ground has so much in common with the third that nothing further need be said about it.[[70]]

The fifth ground is far less persuasive. It claims that the difficulty of putting financial data into context provides reason for the non-disclosure of otherwise relevant documents. It is, we think, unrealistic for any minister to believe that he or she can control, or dictate the context in which matters of public interest are debated. All that a minister can do is seek to explain the data and to provide as accurate a context for it as possible.

The sixth ground takes the point that such documents as are prepared for possible responses to questions in Parliament should remain confidential because their exposure would threaten the Westminster system of government, that is to say, responsible government to which we have earlier referred. This cannot be said to be an unreasonable view. The minister is the one who is responsible for an answer given in Parliament, within the practical modern limits to which we have referred. It is his or her answer itself which is a, or the, matter of public interest, and not the various documents which may have canvassed that answer, or other possible answers. It will be in respect of the answer that the minister actually gives that any political price will have to be paid, just as there may well be a political price to be paid for any claim of conclusiveness, whether it is well-based or not.

The seventh ground is at least arguably not reasonable, in effect, that the public may not be trusted to understand the technicalities of, and the jargon used in otherwise revealable documents. It is not as if the public is unaided by experts and others who can, including, for example, an informed journalist ....

The grounds taken did not clearly articulate something that the oral evidence suggested, namely that the respondent was concerned that what might be disclosed could well be misrepresented, abbreviated or distorted, or at least not presented in a balanced way. Indeed, cross-examination of the appellant's witnesses certainly did go some way towards demonstrating lack of balance, indeed, lack of balance even in the reporting of the particular issue with which the Tribunal was concerned. That would not however be a ground that we would regard as reasonable, for the same reasons as we would reject a ground based upon an asserted lack of technical expertise, or inability to understand jargon on the part of each and every member of the public."[71]

54. The discussion by Callinan and Heydon JJ of the seventh ground needs to be read with their observations regarding their third ground. It would seem to be consistent with other observations they made earlier in their judgment regarding the opinion evidence given by Mr Dennis Rose, who has formerly been Secretary of the Attorney-General's Department and President of the Australian Law Reform Commission, and Professor Peter Dixon, who is an applied economist. Mr Rose had expressed an opinion that disclosure of documents that were provisional in nature or that were superseded would make a very useful contribution to the public debate. Callinan and Heydon JJ said:

"... Contrary to Mr Rose's opinion that the exposure of these would make 'a very useful contribution to the public debate', in our opinion documents of that kind are more likely to mislead or confuse, or to make no contribution to any useful, or currently relevant debate.

Some of Professor Dixon's evidence made the point, incontestable we think, that the topics were of public interest, as to the way in which, for example, 'bracket creep' adversely affected many taxpayers. But a distinction that he too did not make in his evidence was the distinction between provisional or superseded documents, and current ones. The former could do little to advance the analyses which Professor Dixon and other economists would wish to do, of 'the Treasury's apparent concern with the number of people who move from one tax bracket to another in any given year'."[72]

55. Hayne J also appears to support the proposition that there could, on the evidence in that case, be a public interest in refusing disclosure of documents in circumstances where they would be likely to mislead. He said:

"... In the case of those particular documents, the relevant grounds for the claim were grounds asserting that release of the material shown in the documents had 'the potential to lead to confusion and to mislead the public'. The appellant did not assert that this could not constitute a reasonable ground for the claim that had been made."[73]

Section 37: Documents affecting law enforcement

"(1) A document is an exempt document if its disclosure under this Act would, or could reasonably be expected to:

(a) ...;

(b) disclose, or enable a person to ascertain, the existence or identity of a confidential source of information, or the non-existence of a confidential source of information, in relation to the enforcement or administration of the law; or

(2) A document is an exempt document if its disclosure under this Act would, or could reasonably be expected to:

(b) disclose lawful methods or procedures for preventing, detecting, investigating, or dealing with matters arising out of, breaches or evasions of the law the disclosure of which would, or would be reasonably likely to, prejudice the effectiveness of those methods or procedures; or

57. The reference to the "law" is a reference to the law of the Commonwealth or of a State or Territory.[74] For the purpose of s 37(1)(b), s 37(2A) provides that:

"... a person is taken to be a confidential source of information in relation to the enforcement or administration of the law if the person is receiving, or has received, protection under a program conducted under the auspices of the Australian Federal Police, or the police force of a State or Territory, for the protection of:

(a) witnesses; or

(b) people who, because of their relationship to, or association with, a witness need, or may need, such protection; or

(c) any other people who, for any other reason, need or may need, such protection."

58. Given their ordinary meanings, the words "would" and "could" carry with them notions of cause and effect. In the case of "would", it must be a cause and effect that:

"... must as a logical or necessary consequence. ... Be able to, be capable of (doing); have a (specified) ability, potential, or capacity ...".[75]

In the case of "could", it is the cause and effect that "may possibly"[76] come about. The expression used in s 37(1)(b) or (2)(b) is not "could" on its own and without qualification but "could reasonably be expected to". Those:

"... words 'could reasonably be expected to' do not require the demonstration of a probability of damage. ..."[77]

59. In Attorney-General's Department v Cockcroft,[78] Bowen CJ and Beaumont J considered these words where they appear in s 43(1)(c)(ii) of the FOI Act. That provision exempts from disclosure that information which concerns certain business or professional matters and which "could reasonably be expected to" prejudice the future supply of information to the Commonwealth or an agency for the administration of a law or the administration of matters administered by an agency. Their Honours said:

"In our opinion, in the present context, the words 'could reasonably be expected to prejudice the future supply of information' were intended to receive their ordinary meaning. That is to say, they require a judgment to be made by the decision-maker as to whether it is reasonable, as distinct from something that is irrational, absurd or ridiculous, to expect that those who would otherwise supply information of the prescribed kind to the Commonwealth or any agency would decline to do so if the document in question were disclosed under the Act. It is undesirable to attempt any paraphrase of these words. In particular, it is undesirable to consider the operation of the provision in terms of probabilities or possibilities or the like. To construe s 43(1)(c)(ii) as depending in its application upon the occurrence of certain events in terms of any specific degree of likelihood or probability is, in our view, to place an unwarranted gloss upon the relatively plain words of the Act. It is preferable to confine the inquiry to whether the expectation claimed was reasonably based (see Kioa v Minister for Immigration & Ethnic Affairs [1985] HCA 81; (1985) 62 ALR 321 per Gibbs CJ and Mason J)."[79]

"... stringent though that test may be, it does not go so far as to require the decision-maker to be satisfied upon a balance of probabilities that the production of the document will in fact prejudice the future supply of information."[80]

61. Cockcroft's case was considered by the Full Court of the Federal Court in Searle Australia Pty Ltd v Public Interest Advocacy Centre and Another.[81] It said:

"In the application of s43(1)(b), there would ordinarily be material before the decision-maker which would show whether or not the commercial value of the information would be or could be expected to be destroyed or diminished if the information were disclosed. It would be for the decision-maker to determine whether, if there were an expectation that this would occur, the expectation was reasonable."[82]

62. What matters may a decision-maker take into account in applying the test? In McKenzie v Secretary, Department of Social Security,[83] Muirhead J decided that the Tribunal had not been in error in having regard to the form in which the information had been received. He decided that there was no error of law in the Tribunal's conclusion that the letter, in its original handwritten and signed form, could reasonably be expected to enable Mrs McKenzie to identify its author. Heerey J in Bartlett v Secretary, Department of Social Security[84] did not question the Tribunal's approach in considering whether the nature of the information itself could reasonably be expected to enable the applicant to identify the person who had denounced him.[85] The information disclosed the category of person by whom the information had been given, contained an allegation not previously known to the applicant and contained information as to when the allegations had been made.

63. In some cases, the evidence may justify a conclusion that disclosure of information by an agency will lead to its being linked with already available information and so lead to the disclosure of yet other information. This is known as the "mosaic or jigsaw" effect and was regarded as a relevant consideration by the Tribunal in Re Slater and Cox (Director-General, Australian Archives):[86]

"... Evidence was placed before me (Ex 4 as explained in oral evidence) by way of an exercise based upon an analysis of 22 thirty-five-year-old documents. This exercise satisfied me that much can be gleaned, by application of the 'mosaic' technique of piecing together small and individually innocuous pieces of information, that is of present and significant relevance. The cumulative prejudice which may flow from disclosure of documents as a group has been recognised in Australia and overseas. In Re Robinson and Department of Foreign Affairs (1986) 11 ALN N48 the Tribunal said: 'Two additional points deserve mention. First, because large parts of the documents had already been released, proceedings before the Tribunal came, at times, close to a word-by-word battle over disclosure. Not surprisingly, adopting this approach it is tempting to conclude that parts of speech which viewed in isolation are innocuous have no basis for exemption. In circumstances such as the present this temptation must be resisted, for it would be too easy, having before one a document in which only those words which, when viewed in isolation, are exempt have been deleted, to reconstruct the entire document by process of educated guesses and thereby cause damage against which s 33(1)(a) is designed to protect.'"[87]

64. In Re Millis and Australian Archives,[88] Deputy President McMahon described the mosaic theory as an example of the logical process of reasoning by induction although it has also been referred to as inference or deduction:[89]

"... What may be done in analysing the subject documents, and the particular facts recorded in those documents, is to estimate the weight of internal evidence or external connecting evidence in favour of a proposition which is likely to disclose the identity of a confidential source. The so-called mosaic theory is nothing more than this."[90]

65. I continue to hold the view I expressed in Re Petroulias and Commissioner of Taxation,[91] when I said:

"However described, the mosaic theory is not a rule of law determining an outcome. It is no more than a name given to the task of evaluating evidence in order to come to a decision when the evidence comprises that within the documents under consideration and other sources. The decision that is reached is, of course, formulated by the law or is a sub-set of that decision."[92]

66. In the context of s 37(1)(b), I must consider whether the evidence leads to the conclusion that disclosure of the existence, or non-existence, of a confidential source of information follows as a logical or necessary consequence from disclosure under the FOI Act_._ I must also consider whether it would be reasonable, as distinct from something that is irrational, absurd or ridiculous, that disclosure would disclose the existence, or non-existence of a confidential source of information. The evidence may be direct or it may be indirect in the sense understood in the mosaic theory.

67. What amounts to a "confidential source of information" was considered by the Full Court of the Federal Court in Department of Health v Jephcott.[93] The context of its consideration was that of a response given by the Department of Health neither confirming nor denying the existence of a document. Forster J said:

"... All the information given to the Department cannot be 'confidential information' or 'given in confidence' or come from 'a confidential source' so that the mere giving of information without more cannot make the giver a confidential source. What then is a 'confidential source'? I am content to accept the interpretation in Luzaich v United States 435 F Supp 31 at 35 (1977): 'a source is confidential if the information was provided under an express or implied pledge of confidentiality.' In the case of an existing document containing information it might be simple enough by reading the document to discover that the information was provided under an express or implied pledge of confidentiality but in the case of a document which may or may not exist the matter is more difficult. It could be that departmental practice when receiving information of certain types might be of assistance but this Court knows nothing of this. It could also be that the presumed contents of the possibly non-existing document, apprehension as to its contents and the relationship of the supposed informant to the person supposedly informed about might enable an inference to be drawn that the information provided, if any, was so provided under an implied pledge of confidentiality. ..."[94]

68. A similar consideration is undertaken in the context of s 37(2)(b) but there is a difference, though. I note that, unlike s 37(1)(b), s 37(2)(b) requires me to consider the consequences of disclosure at two stages. The first is whether, in the document requested under the FOI Act, there is information about lawful methods or procedures for preventing, detecting, investigating or dealing with matters arising out of, breaches or evasions of the law. If the document does contain information of that sort, I must ask myself whether disclosure of those methods or procedures would, or would be reasonably likely to prejudice their effectiveness. Once that consideration is undertaken and a conclusion reached that the document contains information of that sort, the second stage of the consideration must be undertaken. The second stage requires me to consider whether disclosure of the particular document requested under the FOI Act would, or could reasonably be expected to disclose those sorts of lawful methods or procedures.

Section 40: Documents concerning certain operations of agencies

69. Subject to the qualification found in s 40(2) of the FOI Act:

"... a document is an exempt document if its disclosure under this Act would, or could reasonably be expected to:

(d) have a substantial adverse effect on the proper and efficient conduct of the operations of an agency; or

70. The qualification in s 40(2) brings the public interest into consideration when it provides:

"This section does not apply to a document in respect of matter in the document the disclosure of which under this Act would, on balance, be in the public interest."

71. The exemption provided for in s 40 is framed in terms of whether disclosure under the FOI Act "would, or could reasonably be expected" to have a certain outcome. In the case of s 40(1)(d), that outcome is that of "a substantial adverse effect on the proper and efficient conduct of the operations of an agency."

72. The words "substantial adverse effect" have been considered in a number of cases. Beginning with the word "substantial", its ordinary meanings include that of "... considerable in amount, extent, importance, etc ...".[95] In considering the meaning of the expression "substantial loss or damage", Bowen CJ said in Tillmanns Butcheries Pty Ltd v. Australasian Meat Employees Union & Ors[96]:

"The word 'substantial' would certainly seem to require loss or damage that is more than trivial or minimal. According to one meaning of the word the loss or damage would have to be considerable (see Palser v. Grinling [1984] 1 ALL Er 1; [1984] AC 291 at 316-7). However, the word is quantitatively imprecise; it cannot be said that it requires any specific level of loss or damage. No doubt in the context in which it appears the word imports a notion of relatively, that is to say, one needs to know something of the circumstances of the business affected before one can arrive at a conclusion whether the loss or damage in question should be regarded as substantial in relation to that business."[97]

"The word 'substantial' is not only susceptible of ambiguity; it is a word calculated to conceal a lack of precision. In the phrase 'substantial loss or damage', it can, in an appropriate context, mean real or of substance as distinct from ephemeral or nominal. It can also mean large, weighty or big. It can be used in a relative sense or can indicate an absolute significance, quantity or size ... As at present advised, I incline to the view that the phrase, substantial loss or damage, in s45D(1) includes loss or damage that is, in the circumstances, real or of substance and not insubstantial or nominal. It is, however, unnecessary that I form or express any concluded view in that regard, since the ultimate conclusion which I have reached is the same regardless of which of the alternative meanings to which reference has been made is given to the word 'substantial' in s45D(1)."[98]

73. In Harris v Australian Broadcasting Corporation and Others,[99] Beaumont J considered whether reports of an independent review of the Legal Department of the respondent were exempt within the meaning of paragraph 40(b) of the Act. His Honour found that it was possible that the reports could embarrass those charged with supervising or reviewing the operations of the Legal Department but went on to say:

"However, I am not persuaded that any such effect, even if adverse, could fairly be described as 'substantial' in its impact. In my view, the insertion of a requirement that the adverse effect be 'substantial' is an indication of the degree of gravity that must exist before this exemption can be made out."[100]

74. Muirhead J has also considered the expression "substantial adverse effect" as it appears in s 40 in the case of Ascic v Australian Federal Police.[101] He made specific reference to Beaumont J's use of the word "gravity" which caused him some difficulty. In Muirhead J's view:

"'Substantial' is a word of common usage which can stand on its own feet and the work ascribed to it in statutory interpretation will depend on the statute and of course the issues under consideration. Deane J gave detailed consideration to the word in Tillmanns Butcheries Pty Ltd v. Australasian Meat Industry Employees' Union (1979) 27 ALR 376 at 382. Whilst the court there was considering an application under s. 45D of the Trade Practices Act 1974 which refers to 'substantial loss or damage' his Honour's words that 'substantial loss or damage ... includes loss or damage that is in the circumstances, real or of substance and not insubstantial or nominal' appear to me to be appropriate to most circumstances and closer to the plain meaning of the word and its dictionary interpretations."[102]

75. In the same year as Muirhead J published his judgment in Ascic, the Tribunal reached the conclusion that a "substantial adverse effect" "connotes an adverse effect which is sufficiently serious or significant to cause concern to a properly informed reasonable person".[103]

76. Deputy President McMahon summarised the effect of these authorities when he considered the same expression, "a substantial adverse effect", when used in the context of s 39 of the FOI Act. He did so in Re Connolly and Department of Finance[104] when he said:

"_... There must be a degree of gravity before this exemption can be made out (_Harris v Australian Broadcasting Corp ...); the effect must be 'serious' or 'significant': Re James ... Normally a value judgment has to be made as to whether an adverse effect is or is not substantial when considering exemptions claimed under other sections. ..."[105]

77. If a claim under s 40(1)(d) is to succeed, the substantial adverse effect that would, or could reasonably be expected to occur must be on the "proper and efficient conduct of the operations of an agency". The ordinary meaning of the word "operations" in this context is:

"...4a An act of a practical or technical nature, esp. one forming a step in a process. ... b ...Also, a business concern or enterprise..."[106]

78. In Searle Australia Pty Ltd v Public Interest Advocacy Centre and Another,[107] Davies, Wilcox and Einfeld JJ rejected a submission that the "conduct of an agency" could be limited to matters related to the internal administration of an agency such as a report by an outside agency or a consultant on its operations. They adopted the view of Deputy President Hall in Re James and Australian National University[108] that the expression extends "to the way in which an agency discharges or performs any of its functions".[109] The issue for the Tribunal in Re James and Australian National University was considered in the context of a request for documents recording lecturers' comments in student record sheets together with the names of examiners of honours theses and their tentative grades. Deputy President Hall said that:

" The question, in the present case, therefore, is whether the expression 'the conduct of the operations of an agency', when applied to the University, extends not only to the way in which it carries out its 'administrative' operations, but also its 'academic' operations. ...

As a matter of ordinary English I think that the expression 'the conduct of the operations of an agency' is capable of extending to the way in which an agency discharges or performs any of its functions. So construed, I agree with Mr Toper that it is capable of extending to the discharge by the University of its academic functions in relation to the awarding and conferring of degrees and diplomas (see s. 6 of the Australian National University Act 1946 (Cth))."[110]

79. The occurrence of the substantial adverse effect does not have to be proved as an absolute. ASIC need only establish that disclosure under the FOI Act "would, or could reasonably be expected" to lead to the designated outcome i.e. a substantial adverse effect on the proper and efficient conduct of ASIC's operations.

I have already set out the meaning of this expression in relation to s 37 above.[111]

80. The onus of proof imposed on an agency by s 61(1) of the FOI Act is not irrelevant in considering a claim for exemption. That is an onus imposed on an agency to establish that a decision it has given in respect of a request was justified. Taking a decision that a document is an exempt document, the practical consequence of the onus is that, if the agency is to succeed in those proceedings, it must ensure that the Tribunal has sufficient evidence to establish its claim on the balance of probabilities. Generally, an agency will want to produce that evidence itself to the Tribunal. There is, however, nothing to prevent it from relying on evidence produced during the proceedings by the applicant for review or any party joined to the proceeding. When it makes its initial decision, the agency's position is no different. Rather than satisfying the Tribunal, the decision-maker must satisfy him or herself on the balance of probabilities that the document is an exempt document. That will mean that the decision-maker must look to the evidence before making a decision. If the decision is not supported by the evidence, the decision should not be made. A decision to refuse access on the basis that a document is an exempt document without a proper evidentiary basis, for example, would be a decision that would seek to diminish the right that Parliament has given to every person by means of s 11(1) i.e. the right, subject to the other provisions of the FOI Act to obtain access in accordance with this Act to a document of an agency or an official document of a Minister other than an exempt document.

81. The evidentiary basis on which a decision is made in applying the exemption provisions in the FOI Act underpins the comments made by the Tribunal in Re Williams and Registrar of the Federal Court of Australia[112] of the difficulties faced by an agency when there is no proper evidentiary basis in the first place. The Tribunal was considering a claim that assessments of the work capacity of the four most highly-rated applicants for a position in the Registry of the Federal Court and a document showing the order of merit of five of the applicants were exempt under

" As has been mentioned, it is possible that s 40(1)(c) of the Act could justify the refusal of access in the present circumstances. However, in my opinion, no case has been made out here for the application of that provision. No attempt was made here to demonstrate, by evidence or otherwise, that the 'substantial' adverse effect contemplated by s 40(1)(c) would or could reasonably be expected to occur (see Harris v Australian Broadcasting Corp [1983] FCA 242; (1983) 50 ALR 551 at 545; [1983] FCA 242; 5 ALD 545; Public Service Board v Scrivanich (1985) 8 ALD 44; cf Re Witheford v Department of Foreign Affairs _(1983) 5 ALD 534 at 544). The difficulties in now establishing such a case are formidable (_Science Research Council v Masse [1980] AC 1029 at 1065, 1070-1, 1080-1, 1085; cf Sankey v Whitlam (1978) 142 CLR 1 at 40, 62-3, 97). It follows, in my view, that the documents now in question are also not protected by this provision."[113]

82. In Sankey v Whitlam,[114] to which the Tribunal referred in this passage, Stephen J spoke of the difficulties of relying on evidence that was directed to a class of document rather than to the particular document under consideration. That case concerned, in part, a claim that certain documents were privileged from disclosure in criminal proceedings on the basis that their disclosure would be prejudicial to the public interest. The evidence in support of the claim for privilege was in the form of affidavit evidence sworn by members of the then ministry and senior public servants. It was evidence directed to the class to which the particular documents could be characterised rather than to their contents. It was not suggested that disclosure of their contents would itself result in detriment to the public interest. The:

"... detriment perceived is, rather, that generalized form of apprehended harm which, it is said, will flow from a realization by Cabinet Ministers and by public servants that what they conceived to be confidential communications can, in the event of appropriate curial proceedings being instituted, become public knowledge.

Those who urge Crown privilege for classes of documents, regardless of particular contents, carry a heavy burden. As Lord Reid said in Rogers v Home Secretary[[115]] the speeches in Conway v Rimmer[[116]] have made it clear 'that there is a heavy burden of proof' on those who make class claims. ...".[117]

Section 42: Documents subject to legal professional privilege

83. Subject to a qualification found in s 42(2), s 42 provides that:

"A document is an exempt document if it is of such a nature that it would be privileged from production in legal proceedings on the ground of legal professional privilege."

84. The qualification in s 42(2) refers to documents of the kind referred to in s 9(1). In summary, they are documents provided by an agency to its officers, or used by its officers, for the purpose of making decisions or recommendations under an enactment or scheme and affecting rights, privileges or benefits, to which persons may be entitled, or obligations, penalties or other detriments, to which they may be subject. The documents may be gathered together in some ordered form such as a manual but they may be less ordered and less formally presented. It is enough that they are provided for use or are used for the stated purposes.

85. Section 9(1) is itself subject to a qualification. Excluded from those documents that would otherwise come within its description are those "... documents that are available to the public as published otherwise than by an agency or as published by another agency." Documents of that sort would include text books published by a private publishing house and available to the public for purchase.

86. The fact that documents of that sort are excluded from the ambit of

s 9(1) does not bring them back into the ambit of s 42(1). That follows from the fact that documents of this sort are excluded from the ambit of the FOI Act altogether. In the case of library material maintained for reference purposes, it is excluded from the definition of "document" in s 3(1). Consequently, the right to obtain access to a document that is given by s 11(1) of the FOI Act does not extend to it. In the case of documents that are available for purchase in accordance with arrangements made by an agency, s 12(1)(c) provides that a person is not entitled to obtain access to them under Part III. That is the Part which sets out the right of access in s 11 and regulates the machinery of access. That is to say, it regulates matters such as the making of a request for access, the deletion of matter that is exempt under Part IV or that is irrelevant to the request and the giving of access.

87. Legal professional privilege is a rule of substantive law. A person may use it to:

"...resist the giving of information or the production of documents which would reveal communications between a client and his or her lawyer made for the dominant purpose of giving or obtaining legal advice or the provision of legal services, including representation in legal proceedings."[118]

88. It is essential that there be a relationship of client and legal adviser and that the communication be made within that relationship. As Lord Buckmaster said in Minter v Priest:[119]

" The relationship of solicitor and client being once established, it is not a necessary conclusion that whatever conversation ensued was protected from disclosure. The conversation to secure this privilege must be such as, within a very wide and generous ambit of interpretation, must be fairly referable to the relationship, but outside that boundary the mere fact that a person speaking is a solicitor, and the person to whom he speaks is his client affords no protection."[120]

89. Campbell J explained in Re Doran Constructions Pty Ltd (in liq):[121]

"In other words, the communication which is protected by the privilege must be one which is made or received by a lawyer in the capacity of lawyer: Alfred Crompton Amusement Machines Ltd v Custom and Excise Commissioners (No 2) [1972] 2 QB 102 at 129, 136, 138

While there is this distinction between the employment of the solicitor, and the character in which a communication is made, I do not accept that it requires that each individual sentence spoken in the course of a single meeting to be individually analysed. ..."[122]

90. The reason for the rule was explained by Advocate General Sir Gordon Glynn:

"Whether it is described as the right of the client or the duty of the lawyer, this principle has nothing to do with the protection or privilege of the lawyer. It springs essentially from the basic need of a man in a civilised society to be able to turn to his lawyer for advice and help, and if the proceedings begin, for representation; it springs no less from the advantages to a society which evolves complex law reaching into all the business affairs of persons, real and legal, that they should be able to know what they can do under the law, what is forbidden, where they must tread circumspectly, where they run risks."[123]

91. In the same year, Deane J said in Baker v Campbell:[124]

"... Once one recognizes that the principle underlying legal professional privilege is that a person should be entitled to seek and obtain legal advice without the apprehension of being prejudiced by subsequent disclosure of confidential communications and that the privilege is not confined to such communications as are made in the course of or in anticipation of litigation but extends generally to confidential communications of a professional nature between a person and his lawyer made for the purpose of obtaining or giving legal advice, common sense points to a conclusion that the principle should not be seen as restricted to compulsory disclosure in the course of such proceedings. ..."[125]

92. Entitlement of this kind does not extend to communications engaged in for the purposes of furthering a fraud or a crime. Where the communications are of that nature, they do not attract legal professional privilege in the first place. It is not a case of legal professional privilege's being waived.[126]

93. In AWB Ltd v Cole (No 5),[127] Young J considered what amounts to legal advice:

"(7) The concept of legal advice is fairly wide. It extends to professional advice as to what a party should prudently or sensibly do in the relevant legal context; but it does not extend to advice that is purely commercial or of a public relations character ...

(8) Legal professional privilege protects the disclosure of documents that record legal work carried out by the lawyer for the benefit of the client, such as research memoranda, collations and summaries of documents, chronologies and the like, whether or not they are actually provided to the client ..."[128]

94. Legal professional privilege protects communications made by both parties to those communications. Therefore, as well as protecting communications made to the client by the legal adviser, it will also protect communications made by the client for the dominant purpose of seeking legal advice:

"... [L]egal professional privilege extends to notes, memoranda or other documents made by officers or employees of the client that relate to information sought by the client's legal adviser to enable him or her to advise ... The privilege extends to drafts, notes and other material brought into existence by the client for the purpose of communication to the lawyer, whether or they are themselves actually communicated to the lawyer ..."[129]

95. What amounts to a dominant purpose was considered by Kenny J in Commissioner of Taxation (Cth) v Pratt Holdings Pty Ltd:[130]

"(7) The dominant purpose is not the same as the 'primary' or the 'substantial' purpose: see Grant v Downs at CLR 678; ALR 580 per Barwick CJ. The 'dominant' purpose may be described as the ruling, prevailing, paramount or most influential purpose .... The 'dominant purpose' brings within the scope of the privilege a document brought into existence for the purpose of a client being provided with professional legal services notwithstanding that some ancillary or subsidiary use of the document was contemplated at the time ..."[131]

96. The fact that legal professional privilege attaches to communications rather than to documents means that the privilege may attach to documents which were not written for the dominant purpose of obtaining legal advice but which were copied for that purpose:

"... [P]rima facie, copies of non-privileged documents are privileged if the copies are brought into existence solely for the purpose of obtaining or giving legal advice or solely for use in litigation that is pending, intended or reasonably apprehended. But the prima facie rule is subject to a qualification next to be mentioned.

... Thus, in proceedings in which discovery is available, the contents of an unprivileged original document can be proved as against a party who has had the original in his possession or power, even if a copy of the original is protected from inspection by legal professional privilege. When an unprivileged original can be produced or secondary evidence of its contents can be tendered in evidence, the according of legal professional privilege to a copy does not impair, although it does not hasten ..., the administration of justice.

... I would state the qualification in this way: if an original unprivileged document is not in existence or its location is not disclosed or is not accessible to the person seeking to execute the warrant and if no unprivileged copy or other admissible evidence is made available to prove the contents of the original, the privileged copy loses the privilege. The loss of privilege can be avoided by the production of a copy of the original (which might be produced by copying the privileged copy) the accuracy of which is verified by a person having knowledge of the contents of the original. So long as a copy of the unprivileged original (with verification if necessary) or other secondary evidence of its contents is available to be tendered to prove the contents of the original, the privilege attaching to any copy of the original can and should be maintained. Otherwise, I would hold the privilege of the privileged copy to be lost."[132]

97. The party claiming legal professional privilege must establish it on the balance of probabilities and may do so:

"... by pointing to the nature of the documents or by evidence describing the circumstances in which they were brought into existence. But it should not be thought that the privilege is necessarily or conclusively established by resort to any verbal formula or ritual. The court has power to examine the documents for itself, a power which has perhaps been exercised too sparingly in the past, springing possibly from a misplaced reluctance to go behind the formal claim of privilege. It should not be forgotten that in many instances the character of the documents the subject of the claim will illuminate the purpose for which they were brought into existence."[133]

98. As a rule of substantive law, it has application beyond legal proceedings.[134] It is not a rule that permits a court or Tribunal to weigh a person's interest in resisting the production of the communications either against another's interest in seeing them or against a background of the behaviour of the person claiming legal professional privilege. If communications are subject to legal professional privilege, a court or Tribunal cannot order their production. The privilege is that of the client but the client may waive it, either intentionally or by implication.[135] As Gibbs CJ has said:

"... where there is no intentional waiver the question whether a waiver should be implied depends on whether it would be unfair or misleading to allow a party to refer to or use material and yet assert that that material, or material associated with it, is privileged from production."[136]

99. Even if the client intends not to waive the privilege or has not even turned his or her mind to the question, his or her intentional acts may be regarded as inconsistent with the maintenance of the confidentiality of the communication:

"... What brings about the waiver is the inconsistency, which the courts, where necessary informed by considerations of fairness, perceive, between the conduct of the client and maintenance of the confidentiality; not some overriding principle of fairness operating at large."[137]

100. The mere fact of disclosure to a third person, though, does not of itself amount to waiver[138] but:

" Whether, in a given context, a limited disclosure of the existence, and the effect, of legal advice is inconsistent with maintaining confidentiality in terms of advice will depend on the circumstances of the case. As Tamberlin J said in Nine Films and Television Pty Ltd v Ninox Television Ltd[[139]], questions of waiver are matters of fact and degree. ..."[140]

101. Legal professional privilege may only be abrogated by the clear words of a statute or by necessary implication.[141] There is no suggestion that there has been any statutory abrogation in this case.

102. As a general proposition, legal professional privilege may be claimed in legal proceedings in relation to advice sought from and given by a lawyer employed by the government. It may be claimed provided the professional relationship between the lawyer and the government agency seeking advice has the necessary quality of independence. In Waterford v The Commonwealth of Australia[142] (Waterford), the High Court considered the relationship of client and legal adviser in the context of correspondence passing between the Attorney-General and the Treasurer and between officers of the then Deputy Crown Solicitors' office and officers of the Treasury. Mason and Wilson JJ held that:

"... there is no reason to place legal officers in government employment outside the bounds of legal professional privilege. The proper functioning of the legal system is facilitated by freedom of consultation between the client and the legal adviser. ... To our minds it is clearly in the public interest that those in government who bear the responsibility of making decisions should have free and ready confidential access to their legal advisers. Whether in any particular case the relationship is such as to give rise to the privilege will be a question of fact. It must be a professional relationship which secures to the advice an independent character notwithstanding the employment."[143]

103. Brennan J was more circumscribed in his views and accepted only that officers of the Attorney-General's Department or of the Commonwealth Crown Solicitor's Office did not lack the independence that is essential if legal professional privilege is to attach to documents brought into existence for the purpose of their giving advice or for the purpose of obtaining advice from them. They had given advice to officers of The Treasury. The evidence to which he referred in reaching that conclusion was that:

"The Commonwealth, State and Territorial statutes under which officers are employed in the offices of Crown Solicitors, the Australian Government Solicitor and in the Departments of the respective Attorneys-General give them a certain security of tenure and those statutes would be construed, in the absence of contrary express provisions, as leaving these officers completely professionally independent. The protection of the respective Attorneys-General, as the first Law Officers of the Crown, should extend to all of these officers, so that none of them will be affected in the performance of their professional duty by any sense of loyalty or duty to, or hope of reward from, the government of the day. Counsel for the appellant expressly declined to argue that the Department of the Treasury's advisers in this case lacked the independence which the safeguards to which Mason J. and I referred are intended to secure. I would therefore reject the submission that the officers of the Attorney-General's Department or the Commonwealth Crown Solicitor's Office lack the independence which is essential if legal professional privilege is to attach to documents brought into existence for the purpose of their giving advice or for the purpose of obtaining advice from them. ..."[144]

104. The independence or otherwise of legal advice given by the Legal and Advice Branch of the Office of Workplace Services (OWS) arose in the case of Rilstone v BP Australia Pty Ltd[145] (Rilstone). Besanko J found that the OWS was an executive agency within the responsibility of the Minister for Employment and Workplace Relations. The documents over which legal professional privilege was claimed had been created during the course of an investigation carried out by the OWS. They were created in the exercise of statutory investigatory powers under the Workplace Relations Act 1996.

105. Besanko J was not satisfied on the evidence that the documents were created for the dominant purpose of seeking legal advice from OWS's Legal and Advice Branch but he was satisfied on the evidence that it had the necessary degree of independence. His Honour referred to the evidence that the Legal and Advice Branch was the Workplace Ombudsman's central legal division providing nationwide legal advice to inspectors and senior management. It was responsible for engaging and instructing external legal providers such as the Australian Government Solicitor and other legal providers engaged by the Workplace Ombudsman. He concluded:

"In this case the applicant might have put forward more detailed evidence as to how the Legal and Advice Branch, was the decision-maker operated and its role in the OWS organisation. However, in my opinion, this case has similarities with the facts in Waterford and ... the necessary degree of independence has been established or, put another way, it has been established that the Legal and Advice Branch was a legal adviser for the purposes of legal professional privilege."[146]

106. In Telstra Corporation Limited v Minister for Communications, Information Technology and the Arts (No. 2)[147] (Telstra v MCITA), Graham J came to the contrary conclusion in relation to advice given by lawyers who were employees of Telstra. He noted that:

" No evidence whatsoever has been led by Telstra to establish the role which the various legal practitioners performed within Telstra_. In particular, no evidence has been advanced to disclose the measure of independence of the legal practitioners in question and their ability to provide impartial legal advice, given the roles they have had to perform._"[148]

"In my opinion an in-house lawyer will lack the requisite measure of independence if his or her advice is at risk of being compromised by virtue of the nature of his employment relationship with his employer. On the other hand, if the personal loyalties, duties and interests of the in-house lawyer do not influence the professional legal advice which he gives, the requirement for independence will be satisfied."[149]

107. Later that same year, Branson J considered the same question in Rich

v Harrington[150] in relation to advice given by the OGC located in Price Waterhouse Coopers (PWC). Her Honour found that the person holding the position of General Counsel was a partner of PWC and, as did each of the solicitors in the OGC, held a current practising certificate. That Office operated as a separate unit within PWC and legal advice was provided with the same level of objectivity as would be expected of external lawyers. It is located separately from PWC's business units, its documents and files are maintained separately and its offices are capable of being locked. The office provided legal advice and legal services to PWC on all issues that touched the firm or required legal advice including regulatory enquiries, litigation, contract reviews and transactions. When necessary and appropriate, it briefed external lawyers and counsel to support it in its role and to provide external legal advice and services.

108. The only comment made by Branson J on this evidence was that:

"... It may be that as in-house lawyers, including corporate counsel, play an increasingly important role in advising and providing other legal services to their employers and firms, the common law has come to accept that the requisite independence can be ensured by measures of the kind adopted by OGC ..."[151]

109. Her Honour declined, however, to decide whether the measures were enough in that case because she had to decide that question in the context of the particular advice that was claimed to attract legal professional privilege. The advice was given in respect of allegations and claims given by one of PWC's partners,

Ms Rich, against others in the firm. Branson J said:

"58 In reaching a decision as to whether the relationship between OGC and the respondents was such as to secure to OGC's advice concerning

_Ms Rich's allegations and claims an independent character, I am not required to speculate about how General Counsel, or other solicitors in OGC, in fact approached the giving of that advice (_Ebner v Official Trustee in Bankruptcy [2000] HCA 63; (2000) 205 CLR 337 per Gleeson CJ, McHugh, Gummow and Hayne JJ at [7]). It may be that General Counsel and each solicitor in OGC was fully conscious of, and capable of avoiding, the insidious influences of factors such as loyalty to individual partners and to the firm, including its leadership, concern for the reputation of the firm and the reputations of individual partners in the firm and other like matters. The critical question is whether the relationship between OGC and the respondents with respect to

Ms Rich's allegations was one of professional detachment.

59 To answer the above question it is necessary to give consideration to the nature of Ms Rich's allegations and the significance that they might have for General Counsel and the OGC generally. As mentioned above, they were made by one partner against other partners. It seems uncontroversial that they were of a kind capable of tarnishing the reputation of the firm of which the OGC is a part. They cast aspersions of a personal, rather than a purely professional kind, on the General Counsel's partners including those partners who comprised the leadership of her firm. The General Counsel and the Deputy General Counsel were themselves likely respondents in the litigation in prospect. Because of its likely subject matter, that litigation, should it eventuate, could reasonably be expected to attract a high level of media interest of a relatively sensational kind. For these reasons I conclude that

Ms Rich's allegations were by reason of their content inherently likely to engage the personal loyalties and the duties and interests of all partners of PwC - and probably many employees of the firm as well.

60 I therefore conclude that, having regard to the nature and significance of the allegations raised by Ms Rich in her letter of 2 July 2004, the relationship between OGC and the respondents was not such as to secure the advice of the OGC concerning Ms Rich's allegations the objectively independent character necessary to support the respondents' claim of client legal privilege. The OGC was not in a position to give professionally detached advice to the respondents concerning allegations of the character of those made by Ms Rich."[152]

110. Once the necessary degree of independence has been established and:

"... communications take place between a client and his or her independent legal advisers, or between a client's in-house lawyers and those legal advisers, it may be appropriate to assume that legitimate legal advice was being sought, absent any contrary indications .... In Kennedy v Wallace_,_[[153]] Black CJ and Emmett J inclined to the view that in the ordinary case of a client consulting a lawyer about a legal problem in uncontroversial circumstances, proof of those facts alone will provide a sufficient basis for a conclusion that legitimate legal advice is being sought or given.

111. Legal advice is obtained by those in the private sector and private citizens in relation to legal proceedings brought against them or that they may contemplate or institute. It is sought to ensure that they know what they can and cannot do under the law. To that extent, the public sector is no different. Where a difference lies, however, is in the fact that, to varying extents and in varying circumstances, Ministers and agencies in the public sector have responsibility for developing policy. If accepted by Cabinet and ultimately passed into law by Parliament, that policy has the effect of changing the law. In the course of developing that policy, Ministers and agencies may seek advice as to the state of the existing law and as to the impact that certain changes might have upon it. Is legal advice in those circumstances subject to legal professional privilege assuming, of course, that it is given by an independent legal adviser and the dominant purpose test is met?

112. I will begin with Waterford. Mr Waterford had asked the Department of the Treasury (Treasury) for certain documents relating to projections in the Budget Papers for 1982-83. He then made a second request under the FOI Act for the documents in the possession of Treasury and relating to the processing of his request. Among those documents were memoranda between Treasury and the Attorney-General's Department, minutes between Treasury officers and the Treasurer and letters between the Attorney-General and the Treasurer. Legal professional privilege was claimed.

113. Mason and Wilson JJ referred to s 42 saying that:

"... The plain reading of this provision would suggest that Parliament has acknowledged expressly that legal advice tendered in connexion with the process of administrative decision-making will attract the privilege. ..."[155]

114. The term "administrative decision-making" covers a wide range of decisions but it is often used to refer to decisions of an administrative character and so made under an enactment as in the case of the Administrative Decisions (Judicial Review) Act 1977. Not all of the activities of the public sector are directed to making decisions under an enactment in that sense. A passage from the judgment of Brennan J in Waterford suggests that legal professional privilege may have a wider application:

" In any event, I should think that the public interest is truly served by according legal professional privilege to communications brought into existence by a government department for the purpose of seeking or giving legal advice as to the nature, extent and the manner in which the powers, functions and duties of government officers are required to be exercised or performed. If the repository of a power does not know the nature or extent of the power or if he does not appreciate the legal restraints on the manner in which he is required to exercise it, there is a significant risk that a purported exercise of the power will miscarry. The same may be said of the performance of functions and duties. The public interest in minimizing that risk by encouraging resort to legal advice is greater, perhaps, than the public interest in minimizing the risk that individuals may act without proper appreciation of their legal rights and obligations. In the case of governments no less than in the case of individuals, legal professional privilege tends to enhance application of the law, and the public has a substantial interest in the maintenance of the rule of law over public administration. Provided the sole purpose for which a document is brought into existence is the seeking or giving of legal advice as to the performance of a statutory power or the performance of a statutory function or duty, there is no reason why it should not be the subject of legal professional privilege."[156]

115. Although he did not need to go so far in Waterford, his Honour's reference to "functions and duties" and the need to know the restraints upon them as well as upon powers, suggests that legal professional privilege may extend to legal advice obtained for the purpose of developing policy. His initial statement of the principle in the passage I have quoted in the previous paragraph did not limit the privilege to legal advice obtained for the purposes of functions and duties having a statutory basis.

116. In the case I must consider, I do not need to go beyond the narrower reading of the principles set out by Brennan J for ASIC has a clear statutory basis for its function of policy development in relation to the Corporations Act. Its functions are found in the Australian Securities and Investments Commission Act 2001 (ASIC Act). Section 11 sets out its functions. Of particular note is s 11(3) which provides:

"ASIC may, on its own initiative or when requested by the Minister, advise the Minister, and make to the Minister such recommendations as it thinks fit, about any matter of a kind referred to in s 148."

117. Section 148 provides that the Corporations and Markets Advisory Committee may, on its own initiative or when requested by the Minister, make to the Minister any such recommendations about the matters listed in s 148 of the ASIC Act. Among them is a proposal to make or amend the corporations law, the operation or administration of the corporations law or law reform in relation to the corporations law.[157]

118. Apart from this broader function, I also that s 341 of the Corporations Act was at the heart of matters under consideration by ASIC in developing its policy. It is a statutory provision conferring power upon ASIC.

119. Developing policy about what the law should be and the giving of legal advice about what it is the law or the consequences of any amendment of the existing law can become intertwined with what the policy behind any such changes should be. This was recognised by the majority in Waterford. Mason and Wilson JJ said of it:

"... If a communication satisfies the description of a document brought into existence for the sole purpose of enabling a confidential professional communication between a client and his legal adviser in connexion with pending or anticipated legal proceedings then in our opinion it follows that it is an exempt document within the meaning of s.42 of the Act. In such a case it is not to the point that the document may contain advice which relates to matters of policy as well as of law. It is the connexion between the document and legal proceedings that establishes its character and thus attracts the privilege. ..."[158]

120. The analysis of this issue by Brennan J was focused upon the particular advice given by the Attorney-General's Department to Treasury but he draws an important distinction between the policy of legislation once it has been passed by Parliament and the policy underpinning proposals to change the law. The former may be the subject of legal advice but the latter may not:

"... The policy of the Act is as much a question of law upon which legal advice might be given as the meaning of particular words of the Act might be. I would agree that, if a communication were brought into existence for a purpose of seeking or giving advice as to the government's policy in administering the Act, as distinct from the policy of the Act itself, the communication would not be privileged. That is because executive policy relates to the manner in which a statutory discretion should be exercised, whereas the policy of the Act determines, in reference to a discretion created by the Act, whether there are any and what limits confining the scope of the discretion. Executive policy is a matter of fact, statutory policy a matter of law. ..."[159]

Section 45: Documents containing material obtained in confidence

"A document is an exempt document if its disclosure under this Act would found an action, by a person (other than an agency or the Commonwealth), for breach of confidence."

This provision is qualified by s 45(2) to the extent that it does not apply to an internal working document of the sort described in s 36(1)(a) unless disclosure would constitute a breach of confidence owed to a person or body other than a person in the capacity of a Minister, member of staff of a Minister, a Commonwealth agency or an officer of an agency. That qualification does not apply in this case.

122. On Mr Ryan's behalf, Mr Dharmananda of counsel submitted that, after its amendment following the judgment of the majority to the contrary in Corrs Pavey Whiting and Byrne v Collector of Customs of Victoria and Alphapharm Pty Ltd[160] (Corrs Pavey), s 45(1) clearly provides that the exemption only applies if disclosure would found an action for breach of confidence. An action for breach of confidence, Mr Dharmananda submitted, can be brought in a variety of circumstances. Those circumstances include a claim for a breach of the contractual obligation of confidence and a claim in equity for breach of confidence. He referred to the case of Re Kamminga and Australian National University[161] as a case which left open the proper interpretation of s 45. An action for breach of confidence would also include a claim for breach of a statutory duty of obligation of confidence, Mr Dharmananda continued. Such a claim is analogous to, but not the same as, a claim in equity for a breach of confidence. Mr Dharmananda referred to s 127(1) of the ASIC Act and to Johns v Australian Securities Commission[162] in this regard.

123. I have only outlined Mr Dharmananda's comprehensive submission on the point but will return to it. In a recent matter of Re Callejo and Department of Immigration and Citizenship[163] (Callejo), I considered at length the interpretation of

s 45 and whether it is confined to disclosure that would "found an action ... for breach of confidence". I considered it in light of a number of authorities which have taken broader or narrower interpretations.[164] In summary, I concluded:

"... The cases to which I have referred ... draw distinctions between a word such as 'action' and other words that are used to describe processes or outcomes that may be consequent upon an action. They are defence and remedy or relief. Once that distinction is seen, it seems to me that ... [i]t is one thing to bring an action for abuse or threatened abuse of confidential information that may or may not lead to an equitable remedy and another thing to bring an action for breach of confidence. The former may be an action for breach of confidence but may equally be an action for breach of contract or an action in tort or in negligence. It may be an action that relies on a breach of statutory duty not to disclose information obtained in the exercise of the power. The remedy may be the equitable remedy of an injunction to enforce that statutory duty. Actions in contract, tort, negligence and for breach of statutory duty are not actions for breach of confidence known to the general law even though they may be based on disclosure, or threatened disclosure, of information claimed to be confidential.

An action for breach of confidence is an action of the sort described by Gummow J in Corrs Pavey.[[165]] ...

It may be that the information was given under a contract and that there is a term of the contract prohibiting its dissemination. Without more, disclosure, or threatened disclosure of that information may be the basis for, and so found, an action for breach of contract. It would only found an action for breach of confidence if the five elements referred to by Gummow J in Corrs Pavey were present. ... [I]t may often be the case that circumstances will give rise to actions both in contract and in equity for breach of confidence. Whether they do depends upon the circumstances though and I note that those authorities are careful to distinguish the causes of action. It may well be as Gurry[[166]] said that courts will use their multiple jurisdictions to grant whatever remedies seem appropriate for breach of a duty of confidence but

I do not think that the general law has gone so far as to remove the distinctions between remedies that arise from an action for a breach of confidence and remedies that arise from actions based on other grounds such as contract. Gurry himself recognises the importance of identifying the jurisdiction upon which the court relies so that it may know the remedies available. ... "[167]

I continue to be of the same view and, without repeating them, adopt all of my reasons in Callejo regarding the meaning of s 45.

124. Unlike this case, Callejo was not a case that raised a statutory duty of confidence and I made only passing reference to such a duty. The duty that arises under the ASIC Act is found in s 127(1), which provides:

"ASIC must take all reasonable measures to protect from unauthorised use of disclose information:

(a) given to it in confidence in or in connection with the performance of its functions or the exercise of its powers under the corporations legislation (other than the excluded provisions); or

125. Section 127(1)(a) refers to two characteristics that information must have to be afforded protection under it. The first is that it must have been given to ASIC in confidence. With regard to that characteristic, I note that there is no requirement that the information that is communicated in confidence is necessarily confidential. All that is required is that the manner of its communication be in confidence and that the information have the second characteristic i.e. it must have been given in or in connection with the performance of its functions or its powers under the corporations legislation other than excluded provisions.

126. The expression "corporations legislation" refers to the Corporations Act and the ASIC Act.[168] The Class Order and PS 174 were made in the exercise of powers under the Corporations Act. They were not made under the provisions described as "excluded provisions". Those provisions are s 12A and Division 2 of Part 2 of the ASIC Act.[169] Section 12A refers to functions or powers conferred on ASIC under six enactments other than the Corporations Act or the ASIC Act, in monitoring and protecting market integrity and consumer protection in relation to the Australian financial system and the payment system and in advising the Minister. Division 2 of Part 2 is concerned with unconscionable conduct and consumer protection in relation to financial services. Document 241 was not submitted to ASIC for any purpose connected with its functions under either s 12A or Division 2 of Part 2. Therefore, the excluded provisions have no relevance in this case.

127. Section 127(1)(b) also protects from disclosure information described as protected information. That expression is defined in s 127(9) of the ASIC Act to mean, in summary, information disclosed for the purposes of a function in s 12A and relating to the affairs of certain bodies or persons regulated by ASIC. The functions and powers that ASIC exercised in considering whether to make CO 02/968 and PS 174 are those conferred under the Corporations Act and expressly referred to in s 11 of the ASIC Act and not those in s 12A.

128. Sections 127(1AA) to 127(5) provide for specific circumstances in which ASIC is authorised to disclose information of the sort otherwise protected by

s 127(1). Section 127(5A) makes provision for regulations to be made prescribing uses and disclosures of information that are authorised uses and authorised disclosures for the purposes of the section. None has been made.[170]

129. Disclosure would not be unauthorised if it were required under the FOI Act. Subject to certain qualifications and limitations in that enactment, a person has a right to have access to a document of an agency unless a specific exemption provision applies. Section 127(6)(b) of the ASIC Act itself recognises that nothing in the other provisions of s 127 limit "what may otherwise constitute, for the purposes of subsection (1), authorised use or disclosure of information".

ANNEXURE A: History of the request, its amendment and ASIC's decisions

130. In a request dated 12 October 2003, Mr Matthews sought:

"1 All documents in ASIC's possession dated from 1st January 2001 onwards, excluding documents which are publicly available, regarding the rationale for and implementation of ASIC Instrument CO 02/968 and Policy Statement 174 (PS 174) such as:

1. Reports, proposals, memorandums concerning CO 02/968 and PS 174;
2. Minutes of Meetings where CO 02/968 and PS 174 were discussed etc.

1. All documents in ASIC's possession regarding its investigations into Otter Gold, Allstate Explorations and Beaconsfield Gold excluding documents which are publicly available or which have been circulated to creditors and shareholders. The ASIC investigations I refer to are as follows:
   1. any ASIC investigations into the actions of the external administrators of Allstate, initially referred to in my letter of complaint dated 8 October 2002 to the Australian Shareholders Association which was subsequently referred to ASIC. In particular, actions in relation to the March 2002 creditors meeting and preceding circular to creditors containing the administrators [sic] valuation model;
   2. any ASIC investigations with respect to the Allstate Explorations and Otter Gold hedge book and published accounts initially referred to in my report to Greg Adams of ASIC dated 14 April 2003."[171]

131. Ms Mirijana Soldatic, who was an authorised decision-maker under

s 23(1) of the FOI Act, identified 1,226 documents (comprising many more folios) coming within Mr Matthews' request. On 18 June 2004, she granted access to 40 of them [172]and refused access to the remainder on various grounds.[173]

132. In identifying those documents, Ms Soldatic excluded those documents that were in ASIC's possession and within the terms of the request but which had come into its possession after 14 October 2003. That was the day on which ASIC had received Mr Matthews' request. In doing so, she relied on my earlier decision in

Re Radar Investments Pty Ltd and Ors and Health Insurance Commission.[174]

Ms Soldatic also excluded documents of which Mr Matthews had either been the author or the person to whom they were addressed.

133. Ms Soldatic interpreted the second paragraph of Mr Matthews' request as excluding documents that had been produced to ASIC by third parties and that it had decided were irrelevant to its investigations.

134. In a decision dated 16 August 2004, Mr Blair Ussher, who is authorised to make decisions under s 54(1) of the FOI Act, varied Ms Soldatic's decision. He did so by granting access to five additional documents in their entirety[175] and to five more in part.[176] He recorded that this meant that the number of pages to which Mr Matthews' was granted access had increased from 197 to 356 pages.

135. In a document dated 30 January 2009, the solicitors for Newmont Australia Limited formally documented Mr Matthews' concession that he did not want access to, and so withdrew his application for review in relation to, the following documents or to other documents which are, or contain, duplicates of them:

1. that part of document 531 comprising five pages of correspondence from Kelly & Co to ASIC and a copy of a notice given under s 30 of the Australian Securities and Investments Commission Act 2001 (ASIC Act);
2. that part of document 532, comprising transcript of the examination of Mr Phillip Staveley on 16 April 2003 under s 19 of the ASIC Act;
3. document 708;
4. documents 767-780;
5. documents 413 and 415;
6. document 634;
7. documents 1277 and 1278; and
8. documents 533 and 534 to the extent that they contain a copy or part or all of the transcript of Mr Phillip Staveley on 16 April 2003 under s 19 of the ASIC Act.

136. Mr Matthews had given this indication on the third day of the hearing after he had had the opportunity to consider his cross-examination of Mr Day on the previous day regarding documents 342 - 1322.[177] In a further document dated on the same day, he indicated that he wished to amend and simplify his request to encompass only those documents which related to what he described as the "Compromised/Corrupted The Final Version of PS 174". This meant that he sought access only to:

"... Documents 1 to 341 plus any other documents (including any further missing documents we are still not currently aware of) that relate directly or just as importantly indirectly to the creation of PS 174 etc. By other documents I mean the following documents which for one reason or another have been so far misleadingly or incorrectly been labelled Allstate investigation documents but in actuality are PS174 documents either directly or indirectly. The ones identified so include the following:

ADDITIONAL DOCUMENTS IDENTIFIED BY ASIC AND EXEMPTION CLAIMS DISCONTINUED

137. In the course of preparing its material for the hearing, ASIC identified a further 96 documents numbered 1227 to 1322. At the same time, ASIC has indicated that it no longer claims exemption in relation to two groups of documents:

1. documents numbered 179, 180, 215, 241(PR), 244(PR), 421, 444, 641 (subject to consultation with a third party) and 650; and
2. documents that were among those that were the subject of evidence in Mr Day's affidavit and numbered 346, 355, 366, 367, 368, 371, 422, 424, 425, 441, 447, 476, 514, 582 and 584.

138. ASIC consents to my making an order that Mr Matthews be granted access to these documents subject to his paying the outstanding balance of assessed charges.[178] As the decision that I am reviewing is not a decision that involves a consideration of the charges imposed by ASIC but a consideration of whether or not the documents are exempt, I have framed the decision relating to these documents in terms of exemption rather than of access. Whether or not Mr Matthews gains access depends upon whether or not ASIC continues to impose the charges and whether or not Mr Matthews pays them.

THE DOCUMENTS IDENTIFIED BY ASIC BEFORE THE HEARING AS RELEVANT TO MR MATTHEWS' NARROWED REQUEST

139. Documents 1 to 341 are found in nine 75mm lever arch folders. A description of each document and the number of pages it comprises is shown in the Revised Schedule of Documents submitted on 20 February 2009 (Schedule). Also shown against each document is a letter signifying whether the document was sought and, if sought, whether exemption is claimed for it or whether access has been granted to it either in whole or in part. If exemption is claimed either for the whole of the document or in relation to part of it, the section or sections under which exemption is claimed is also noted in the Schedule.

140. As a broad description of the types of documents comprising those 341 documents, I have examined the documents and accept that a broad description of the categories into which they may be grouped is that given by Mr Price in his affidavit:

"(1) Documents in respect to legal advice - including the following:

1. Internal memoranda and emails seeking legal advice from ASIC's internal Counsel, and/or containing that legal advice, including covering emails, and including drafts of these types of documents;
2. Briefs to external Counsel for advice, including drafts, and advices from external Counsel;

1. Internal memoranda, emails, and file notes referring to and/or discussing legal advice received.

(2) Documents prepared by ASIC officers for ASIC's policy decision making forums, in particular Commission meetings, and meetings of RPG - including the following:

1. Papers prepared by ASIC officers for meetings of ASIC, including various drafts, and covering notes and emails;
2. Submissions made by ASIC officers to RPG, including various drafts and covering notes and emails.

(3) Internal documents prepared for project management purposes, including drafts.

(4) Various drafts of the Issues Paper and the Discussion Paper.

(5) Submissions received from external parties in respect to the Discussion Paper.

(6) Draft Policy Statements and Class Orders, including covering notes and emails.

(7) Regulatory Impact Statements, including drafts and covering notes and emails.

(8) Memoranda, emails, and file notes of conversations between ASIC officers and officers of Commonwealth Treasury.

(9) Miscellaneous internal deliberative documents created by ASIC staff for the purposes of developing and/or implementing policy in respect to the financial reporting and annual meeting obligations of companies under external administration, including emails, briefing notes, summaries and analysis of submissions from external parties."[179]

141. The other five documents sought by Mr Matthews are described in the Schedule and are:

Confidential submission by external party to Regulatory Policy Branch, ASIC re: Financial Reporting and meeting obligations or Companies in Administration

Printout of ASIC email from Mark Steward to Shannon McGuire & another entitled "Internal consultation on financial reporting and AGM obligations of externally administered companies"

Printout of ASIC email from Shannon McGuire to Sue Hansen with attachment

Printout of ASIC email from Sue Hansen to Shannon McGuire entitled "No 2 re: Allstate Explorations N.L."

Printout of ASIC email from Sue Hanson to Shannon McGuire entitled "re: Release date for PS 174 - Externally administered companies financial reporting and AGMs"

ANNEXURE B: Reviewing decision by considering exemptions in light of sample of documents is not an option open to the Tribunal

142. At one time, there was a possibility that the parties would agree between themselves that I look at a sample of the documents and determine whether ASIC's claims for exemption were, or were not, justified under the FOI Act. I think that I had power to agree to this course of action by looking to both ss 25(4A) and 42C of the AAT Act.

"The Tribunal may determine the scope of the review of a decision by limiting the questions of fact, the evidence and the issues that it considers."

144. The power in s 25(4A) is a power held by Ryan J in Robert Bosch (Australia) Pty Ltd v Mr Egon Fice, Member of the Administrative Appeals Tribunal (Robert Bosch)[180] to be "... available to the Tribunal in aid of the exercise of its primary power under s 25(4) of the AAT Act 'to review any decision in respect of which application is made to it under an enactment.'"[181] The powers and discretions that the Tribunal may exercise in exercising that primary power are those set out in

s 43(1) i.e. "all the powers and discretions that are conferred by any relevant enactment on the person who made the decision". In Re General Merchandise & Apparel Group P/L and CEO of Customs and Australian Weaving Mills,[182]

" When used as a verb as in s 25(4), the ordinary meanings of the word 'review' include:

'... 1 to see or view something again. 2 to examine or go over something, especially critically or formally. ... 7 law to re-examine

128. This is the sense in which Bowen CJ and Deane J seem to have understood the word when they said:

' The function of the Tribunal is ... an administrative one. It is to review the administrative decision that is under attack before it. In that review, the Tribunal is not restricted to consideration of the questions which are relevant to a judicial determination of whether a discretionary power allowed by statute has been validly exercised. ...

The question for the determination of the Tribunal is not whether the decision which the decision-maker made was the correct or preferable one on the material before him. The question for the determination of the Tribunal is whether that decision was the correct or preferable one on the material before the Tribunal. ..."[184]

129. In deciding whether the decision was the correct or preferable decision, the Tribunal must look not only to whether the law has been correctly applied but to whether the decision is correct in light of that law and on the basis of all of the relevant material. If a range of decisions would be correct and not merely one, merits review requires that the decision that is preferable be chosen from that range of correct decisions. The choice of the preferable decision is made having regard to matters such as any criteria or considerations prescribed by the relevant legislation or inherent in the purposes it seeks to achieve and having regard to any policy consistent with those criteria or considerations."[185]

145. In light of its obligations as explained by Bowen CJ and Deane J, it seems to me that the Tribunal cannot use the power in s 25(4A) of the AAT Act to abandon the duty it has to review a decision. It can, however, use that power, as it was used by the Tribunal in Robert Bosch to direct that a particular question be heard and determined as a preliminary issue. That was a course approved by Ryan J. It seems to me that it can also use the power to support, in part, a decision to review a decision made under the FOI Act by reviewing only some of the documents on the basis that those documents are representative of all of the documents or of each of the categories of documents in respect of which exemption is claimed.

146. I say that the Tribunal can rely on the power in s 25(4A) "in part" because it seems to me that the Tribunal could not make a decision in relation to all of the documents if it has not examined their substance and considered the claim for exemption in relation to each of them. Unless it follows that path, it does not know that its decision is the correct or preferable decision. If, however, the parties agree that the Tribunal's decision on a sample of documents can be applied to all of the documents and the Tribunal has satisfied itself that the documents are representative of the others or of the categories into which they can be grouped, the Tribunal could rely on its power under s 42C of the AAT Act to do so. Section 42C(1) provides that the Tribunal may make a decision if the parties reach a written agreement as to the terms of that decision that would be acceptable to them and the Tribunal is satisfied that a decision in, or consistent with, those terms would be within its powers to make.

147. As the Tribunal must rely on both powers given to it under ss 25(4A) and 42C of the AAT Act in order to undertake a review based on a sample, it cannot undertake a review on that basis if it cannot exercise its power under s 42C i.e. if the parties do not agree to its making a decision on that basis. This is such a case and so

I am obliged to read each page of each document in order to review ASIC's decision to refuse access to them or to part of them. This is a path that Weinberg J, who was faced with a similar number of documents in Jorgensen v Australian Securities and Investments Commission,[186] said "would have taken literally weeks". His Honour chose another path, which is apparent from the following extract from his judgment:

" It is obviously difficult, in a case of this nature, to undertake the task of going through each document sought by the applicant, testing it against the particular exemption claimed, and considering whether or not the tribunal erred in law in arriving at the conclusion that it did. The sheer breadth of the applicant's request, dealing as it did with the manner in which an investigation had been conducted, and whether or not a director's name had been rightly or wrongly entered at a particular time on the register, led to some 768 documents totalling almost 3000 pages being regarded as potentially relevant. The applicant's request has been considered by ASIC, the Ombudsman and by the tribunal. He now seeks to have this court embark upon a similar exercise.

The jurisdiction of this court in relation to appeals from the tribunal is conferred by s 44 of the AAT Act. That jurisdiction is confined to addressing questions of law. It does not involve merits review, or any type of rehearing. ...

... Although the court must intervene if an error of law is identified, questions of fact should not be inflated or magnified into questions of law. The fact that a tribunal falls into error in a step in its process of reasoning does not mean that the decision must necessarily be set aside. ...

... Cases of this type, of which there are many, demonstrate the limited nature of review of facts that can be undertaken under the rubric of an appeal on a question, or questions, of law.

As indicated earlier, I have not engaged in a detailed examination of every page of every document in dispute. To have done so would have taken literally weeks. I have instead examined a representative sample of the documents in question, chosen essentially at random, in order to gauge whether the tribunal's interpretation of the various provisions upon which it relied in upholding ASIC's claims for exemption revealed some legal error.

In the end, apart from one relatively minor matter, I have been unable to detect any such error."[187]

148. In view of the very different task that an appellate court must undertake from that which faces this Tribunal under the AAT Act and the FOI Act,

I have already given my reasons for concluding that I cannot take this path. That is not to say that it is not an appropriate course for ASIC to have taken in preparing its evidence and presenting it at the hearing. It is the course it has chosen and I have no difficulty with it. It has identified the principles that it considers relevant and applied them to samples of documents drawn from various categories of documents. Their evidence has been directed to those principles and to the various categories of documents. It is sufficient for me to consider in relation to all of the documents.

149. Clearly, ASIC has had to engage in an enormous task in reviewing the documents, making decisions upon them and preparing the necessary documentation required under the AAT Act and the FOI Practice Direction. It is a task that would have fallen upon a very small handful of people. Among them was Ms Birch. Also among them were persons such as Mr Day and Mr Price who have been called on to give evidence. The enormity of the task has to be recognised and it was a task some 8,500 pages longer than the 3,500 task that I am left with.

ANNEXURE C: The Tribunal's powers to respond to Mr Matthews' wish to withdraw part of his application

150. Mr Matthews has put his position either in terms of his no longer seeking access to, or of withdrawing his application for review in relation to, a large number of the documents identified as coming within his request. Section 42A(1A) of the AAT Act provides that a person may discontinue or withdraw an application at any time but it refers to the whole application. The consequence of withdrawal or discontinuance is dismissal of the application.[188] Section 42A(1A) does not speak in terms of withdrawing or discontinuing part of an application and so dismissing part of it. Section 42B also does not speak of dismissing only part of an application in the circumstances in which it permits the Tribunal to dismiss an application.

151. I am also mindful that this is not a matter in which the applicant and respondent are the only parties to the proceeding. There are several others. Section 42A(1) specifically recognises that there may be more than two parties. It provides that, where "all the parties to an application before the Tribunal for a review of a decision consent", the Tribunal may dismiss the application without reviewing the decision or completing the review. Similarly, s 42C(1) provides for the Tribunal to make a decision by consent where "agreement is reached between the parties". The use of the word "between", rather than "among", may lead some to think that agreement is reached between two people and so between the applicant and the respondent.[189] It is more likely that the draftsman was aware of the broader interpretation given to the word "between" and intended to refer to an agreement reached by all who are parties to the proceeding and not simply two.[190] It seems to me that the Tribunal can only exercise its power under s 42C if all of the parties agree to the terms of a decision that is acceptable to them.

152. Returning to s 42A(1A), it seems to me that it permits an applicant to discontinue or withdraw an application at any time and without the consent of, or consultation with, all or any of the other parties. The unilateral action of an applicant brings the application for review to an end. I do not, however, think that s 42A(1A) permits an applicant to withdraw or discontinue part of an application. I am encouraged that this is the correct view when I have regard to s 42C, to which I have already referred. Section 42C(1) gives the Tribunal power to make a decision by consent if the parties should agree that is the correct course of action and the Tribunal thinks it both within its power and appropriate to do so. Sections 42C(2) and (3) specifically deal with two separate situations: one in which agreement is reached as to the terms of a decision in relation to a proceeding and the other when agreement is reached only in relation to a part of a proceeding or a matter arising out of a proceeding. Parliament has seen fit to cater for the two situations under s 42C but has not done so in relation to a withdrawal or discontinuance under s 42A(1A). Therefore, it seems to me that withdrawal or discontinuance must be of the whole of an application or not at all.

153. In this case, the joined parties have not sought to carry on the proceeding to review the decision in so far as it relates to Allstate. In light of that and in light of Mr Matthews' not being able to withdraw or discontinue part of his application, I think I should treat Mr Matthews' statement of his position as amounting to consent to my affirming that part of ASIC's decision that relates to all of the documents sought in his initial request other than those identified in paragraph [136] above. I note Mr Knapp's contentment with that approach.[191] The contentment of ASIC and of the other parties joined is inherent in the position they took in the proceeding to resist Mr Matthews' obtaining access to the documents.

ANNEXURE D: Preliminary issues relating to the scope and limits of review

154. Mr Knapp, representing himself, made extensive submissions addressed to establishing that the process leading to ASIC's development of PS 174 was an improper process. It was a process that prevented a robust debate within ASIC. It was a process that withheld one submission that had been received during the public exposure period and had injected it at a later stage of ASIC's deliberations to give it a status or impact not enjoyed by the other public submissions.

Mr Matthews also suggested that the process was unacceptable because of its inclusion of a statement that ASIC would not take action for previous breaches of the law in circumstances that were then the subject of PS 174. He described its inclusion in PS 174 as being "at the last minute" and "totally unacceptable".[192]

155. While submissions of this sort have a place in the consideration of such aspects as the public interest element of certain exemptions under the FOI Act, I want to emphasise that a review of a decision under the FOI Act is not a forum for enquiring into the rights and wrongs of what has happened. It may be that the documents to which a person is given access under the FOI Act may be used to institute proceedings of some sort or persuade authorities to hold an enquiry of some sort. The task of the Tribunal under the FOI Act is to decide whether the decision made to refuse access to documents is the correct decision. I do not say the "correct or preferable"[193] decision for, once the Tribunal decides that a document is an exempt document,[194] it does not have the power to decide that access to that document, so far as it contains exempt matter, is to be granted.[195]

156. All of the parties were actively engaged in the case. Mr Matthews, as the applicant, and ASIC, as the decision-maker, are parties to the proceeding that is the application to the Tribunal for review of a decision.[196] The others have been joined as parties by an order of the Tribunal made under s 30(1A).[197] None is a party by virtue of having made an application to the Tribunal under either ss 59 or 59A of the FOI Act.[198] If they had been, their role would have been limited to leading evidence or producing material and making submissions directed to a review of the decision that the documents are exempt under either s 43 or s 41, as the case might be.[199]

157. Once a person has been made a party under s 30(1A), it seems to me that there is nothing in the AAT Act or in the FOI Act that leads to a conclusion that a person may be made a party to a part only of the proceeding.[200] A person is made a party to the whole of the proceeding. Where that proceeding, as defined in s 3(1) of the AAT Act, is an application for review of a decision, the person is a party to that proceeding without reservation and is also a party to all incidental proceedings to that application. If a person's role in a proceeding is to be limited, the power to impose that limit must be found in s 33(1) and possibly in s 25(4A) having regard to s 39(1). I do not need to explore that further for I did not make any order limiting the participation of any of the parties in the proceeding.

158. During the course of the hearing, a question arose as to the use that might be made of the material produced for the purposes of the hearing of

Mr Matthews' application for review. The issue did not arise in relation to any particular document but it was a matter of concern to the parties. I will set out the principles as I understand them so that the parties have some basis for carrying out their own investigation of the principles and assessment of their positions in relation to the documents they have received during the course of the proceedings.

159. That material must be distinguished from the documents that are the subject of Mr Matthews' request and in respect of which ASIC has claimed exemption. Should I decide that an exemption or exemptions cannot be claimed in relation to those documents and that Mr Matthews should be granted access to them, the FOI Act does not limit the use that he may make of them. I refer specifically to the FOI Act for there may be other limitations upon his use. That this is so is apparent from s 91. That section protects the Commonwealth, an agency, a Minister or an officer from an action for defamation, breach of confidence or infringement of copyright in certain circumstances. One of those circumstances is found in s 91(1), which provides that no such action lies against those persons who authorise the giving of access to a document under the FOI Act. In addition, none of those actions lies against the author of the document or any other person by reason of the author's or the person's having supplied the document to an agency or a Minister. Were

Mr Matthews to disclose the documents to another person, however, he could not rely on s 91(1) to provide a defence to an action for defamation, breach of confidence or infringement of copyright. His disclosure would be regarded as a publication for the purpose of the law and the immunity given by s 91(1) and the other provisions of s 91 does not extend to that publication.

160. The material that is produced at or in connection with the application for review of ASIC's decision claiming exemptions over the documents, or some of them, sought by Mr Matthews is a separate matter. At common law, such material may be subject to an implied undertaking as to its use. The nature of that undertaking and its application was considered in Hearne v Street.[201] In that case, Gleeson CJ said that the implied undertaking was described as "... now better understood as a substantive legal obligation".[202] The majority, Hayne, Heydon and Crennan JJ also spoke in terms of obligation.[203] The advantages of doing so were described by Hobhouse J in the earlier case of Prudential Assurance Co v Fountain Page:[204]

" This undertaking is implied whether the court expressly requires it or not ... It is now in reality a legal obligation which arises by operation of law by virtue of the circumstances under which the relevant person obtained the documents or information. However, treating it as having the character of an implied undertaking continues to serve a useful purpose in that it confirms that the obligation is one which is owed to the court for the benefit of the parties, not one which is owed simply to the parties; likewise, it is an obligation which the court has the right to control and can modify or release a party from."[205]

161. In Hearne v Street, Hayne, Heydon and Crennan JJ stated the obligation:

"Where one party to litigation is compelled, either by reason of a rule of court, or by reason of a specific order of the court, or otherwise ..., to disclose documents or information, the party obtaining the disclosure cannot, without the leave of the court, use it for any purpose other than that for which it was given unless it is received into evidence. The types of material disclosed to which this principle applies include documents inspected after discovery ..., answers to interrogatories ..., documents produced on subpoena ..., documents produced for the purposes of taxation of costs ..., documents produced pursuant to a direction from an arbitrator ..., documents seized pursuant to an Anton Piller order ..., witness statements served pursuant to a judicial direction ... and affidavits ..."[206]

162. The bases for both obligation and the qualification to it is found in the judgment of Mason CJ in Esso Australia Resources Ltd v Plowman:[207]

"... The implied undertaking is subject to the qualification that once material is adduced in evidence in court proceedings it becomes part of the public domain, unless the court restrains publication of it.

It would be inequitable if a party were compelled by court process to produce private documents for the purposes of the litigation yet be exposed to publication of them for other purposes. No doubt the implied obligation must yield to inconsistent statutory provisions and to the requirements of curial process in other litigation, eg discovery and inspection, but that circumstance is not a reason for denying the existence of the implied obligation."[208]

163. The obligation extends beyond the parties to the proceedings. "To be effective, the undertaking must bind the litigant by whom it is given and his or her privies".[209] The majority in Hearne v Street who approved this principle did not go on to identify those who come within the description of "privies". Gleeson CJ said that it was unnecessary to do so in light of the terms in which the issue had been expressed.[210] The majority did, though, refer to the judgment of Anderson J, with whom Pidgeon and Ipp JJ concurred, in Hamersley Iron Pty Ltd v Lovell[211] with seeming approval. His Honour had said:

"The implied undertaking is binding upon anyone into whose hands the discovered documents come, if he knows that they were obtained by way of discovery".

164. The majority in Hearne v Street went on to say:

"There is no support in the authorities for the idea that knowledge of anything more than the origins of the material in legal proceedings need be established. In particular, there is no support for the idea that knowledge of the 'implied undertaking' and its consequences should be proved, for that would be to require proof of knowledge of the law, and generally ignorance of the law does not prevent liability arising."[212]

165. They did not go on to consider what was encompassed within the obligation not to "use" the documents or information for any purpose other than that for which it was given. Gleeson CJ expressly declined to do so for, like the question regarding the class of persons to whom the obligation extends, it was a question that could cause difficulties of a sort that did not arise in the case before the court.[213]

166. In Otter Gold Mines Ltd v McDonald,[214] Sundberg J decided that the obligation or implied undertaking of this sort extends to proceedings in the Tribunal in so far as documents are produced under compulsion. Compulsion, his Honour said, is the true basis on which the implied undertaking lies.[215] That was the basis on which the documents in question had been produced to the Tribunal in the proceedings with which he was concerned. The documents:

"... were produced pursuant to a summons under s 40(1A)(c) of the AAT Act which empowers the Registrar to summon a person to appear before the Tribunal at the hearing of a proceeding to produce books and documents in the possession, custody or control of the person that are mentioned in the summons. Failure to comply with the summons without reasonable excuse is an offence under s 61(1), and an offence under s 63(d) - doing an act or thing that would, if the Tribunal were a court of record, constitute a contempt of that court. ..."[216]

167. I am, of course, bound by what his Honour has said but respectfully note that the same conclusion can be reached having regard to the Tribunal's obligations under the AAT Act. I will begin with the principle established by Parliament in s 35 of the AAT Act. Sections 35(1) and (1A) are concerned with preserving the public nature of the hearing of a proceeding. Sections 35(2)(a) and (aa) give the Tribunal power to order that a hearing, or part of it, be held in private and to direct that the names and addresses of witnesses appearing before the Tribunal be restricted. Sections 35(2)(b) and (c) also give the Tribunal power to:

"(b) give directions prohibiting or restricting the publication of evidence given before the Tribunal, whether in public or in private, or of matters contained in documents lodged with the Tribunal or received in evidence by the Tribunal; and

(c) give directions prohibiting or restricting the disclosure to some or all of the parties to a proceeding of evidence given before the Tribunal, or of the contents of a document lodged with the Tribunal or received in evidence by the Tribunal, in relation to the proceeding."

168. The power in s 35(2) is not unfettered for s 35(3) goes on to require the Tribunal to "... pay due regard to any reasons given to the Tribunal why the hearing should be held in private or why publication or disclosure of the evidence or the matter contained in the document should be prohibited or restricted". In doing so:

"... the Tribunal shall take as the basis of its consideration the principle that it is desirable that hearings of proceedings before the Tribunal should be held in public and that evidence given before the Tribunal and the contents of documents lodged with the Tribunal or received in evidence by the Tribunal should be made available to the public and to all the parties ...".[217]

169. Documents produced under summons under s 40(1A) of the AAT Act are documents produced under compulsion[218] but are they documents that come within the purview of s 35? If they do, they would be subject to public disclosure unless a confidentiality order were made. There would then be a conflict between the conclusion reached by Sundberg J in Otter Gold Mines Ltd v McDonald and s 35.

I do not think that there is such a conflict for I do not think that summonsed documents come within the purview of s 35 unless they are tendered in evidence. If they are tendered in evidence, they clearly do come within its purview and are available to the public unless a confidentiality order is made under s 35. Consistently with Hearn v Street, members of the public can then use the material for their own purposes.

170. If summonsed documents are not admitted in evidence, they remain documents "produced" to the Tribunal. Sections 40(1A), (1B), (1D) and (1E) each refer to documents' being "produced". The ordinary meanings of the word "produce" include "... to bring out or present something to view. ...".[219] That may be the case when, for example, a police officer is executing warrants of apprehension and is required to produce the original warrant.[220] Under the Customs Act 1901, the word "produce" involves the presentation of a document to a Customs officer and may, or may not, involve transfer of possession.[221]

171. In the context of production in response to a summons, the AAT Act clearly contemplates a transfer of possession from the person producing documents to the Tribunal or, at least, to one of its Registries. Does that mean that documents produced as required by a summons but not yet, if ever, admitted in evidence and not subject to a confidentiality order are documents that are "lodged" with the Tribunal? As with a court, a document is lodged in the Tribunal:

"... when it is physically deposited with the court or tribunal or when it has come into the possession of the court or tribunal by some other means such as by post or facsimile transmission."[222]

172. That act of lodgement is distinguished from "filing" a document, which is a:

"... word traditionally used to describe the act or process of placing documents in the records of courts or registries."[223]

It follows that "A party who is required to 'lodge' a document does not have the power or ability to 'file' that document among the records of the court or its registry."[224]

173. This use of the words "lodge" and "file" is consistent with the way in which they have been used in the AAT Act. The word "file", or a derivative of it, does not appear but it is used in the Administrative Appeals Tribunal Regulations 1976 (AAT Regulations) in the various forms appearing in Schedule 1 to those Regulations. It is used to denote the Tribunal's "file number". Fees are payable "for lodging with the Tribunal" various applications set out in r 19(1) of the AAT Regulations.

174. In s 40(1A) of the AAT Act, Parliament has chosen neither the word "lodge" nor "file" but "produce". In so far as a summons issued under that provision is directed to documents, books or things in the possession, custody or control of the person to whom it is directed, a summons requires that person to "produce" them to the Tribunal. A summons to produce documents must accord with either Form 8 or 9 in Schedule 1 of the Administrative Appeals Tribunal Regulations 1976 (Regulations). Form 8 is headed "Summons to give evidence and produce documents" and Form 9 is limited to the production of documents.

175. There is a clear distinction between giving evidence and producing documents. There is also a clear distinction between producing documents and lodging documents. There are many references to lodging documents in the AAT Act.[225] Each refers to steps taken by a party to a proceeding or by a person who will become a party. Those steps are taken to give documents to the Tribunal. The word "produce" or a variation of it is used in only four provisions in the AAT Act. One is

s 40(1A) giving the Tribunal power to issues summonses. Another is s 61(3) which provides that it is an offence if, having been given a summons under the AAT Act to "produce a book, document or thing" and without reasonable excuse,[226] a person fails to comply with that summons.

176. The third and fourth provisions are ss 36(2) and 36B(2). They mirror each other with one relating to public interest certificates by the Commonwealth Attorney-General and the other with those by State Attorney-Generals. Those certificates are to the effect that disclosure of matter in a document would be contrary to the public interest. Sections 36(2) and 36B(2) each serve two functions. One is to state that:

"A person who is required by or under this Act to disclose the information, or to produce to, or lodge with, the Tribunal the document in which the matter is contained, for the purposes of a proceeding is not excused from the requirement ...".

The other is to require the Tribunal to ensure that the information or matter contained in the document is not disclosed to any person other than the member constituted for the purposes of the proceeding and:

"... in the case of a document produced to or lodged with the Tribunal, to ensure the return of the document to the person by whom it was produced or lodged."

177. Sections 36(2) and 36B(2) clearly envisage a distinction between lodgement and production. That is consistent with the way in which those two words, or derivatives of them, are used in the sections of the AAT Act to which I have referred. Lodgement is consistent with the actions of the parties or of those who would be parties to an application. Filing is consistent with the actions of the Tribunal and of its officers. Production is consistent with the actions of third persons who are not parties to an application, and who do not wish to be, but who are either required to give certain documents to the Tribunal or, in the case of the Attorneys-General, wish to do so. In view of that, it seems to me that Parliament has deliberately chosen to exclude from s 35(3) documents that have been produced to the Tribunal under a summons or otherwise. That is to say, Parliament has not regarded them as being documents that it considers should be made available to the public. That interpretation is consistent with the powers given to the Tribunal under s 35(2) to make directions prohibiting or restricting the publication of matters contained in evidence given before the Tribunal or in documents lodged with the Tribunal. There was no need to give the Tribunal any such power as documents produced to the Tribunal under a summons would not be available to the public and would, so far as the parties are concerned, be subject to the implied undertaking or obligation not to use them for purposes other than those connected with the proceedings in which they were summonsed.

178. The consequence of these principles for the parties in this case is that, once my decision has been given, the parties are not regarded as having given an implied undertaking, and are not under any obligation, to refrain from using the material that has been given in evidence in the hearing or lodged in the Tribunal (whether or not it was admitted in evidence at the hearing) they have received in the course of the hearing unless:

(i) the confidentiality of that material is protected by an order made under s 35 of the AAT Act or by a statutory provision applicable to it; or

(ii) that material has been produced by compulsion under a summons issued under s 40(1A) of the AAT Act and has not been admitted in evidence.

The fact that the parties are not under such an obligation does not mean that they may use it with impunity for they must consider whether there are consequences under the general law, such as the law of defamation, in their choosing to do so.

179. I recognise that this interpretation may give the implied undertaking or the obligation a narrower range of application than it is given in the courts in so far as lodged documents are concerned. If that is the case, it arises as a result of the provisions in s 35 of the AAT Act. Section 35(3) clearly states that it is desirable that the content of documents lodged with the Tribunal should be made available to the public. Parliament has modified what might otherwise be the operation of the implied undertaking.

180. Why Parliament would choose to do that may lie in the nature of the task facing the Tribunal. Its primary function is to review the merits of administrative decisions and the Tribunal is required to come to the correct or preferable decision.[227] The correct or preferable decision is not necessarily the decision sought by one party or the other and, unlike a court, it is not reached on the basis of the pleadings of the parties. It may be a decision sought by one or other of them but it may be a different decision altogether for:

"The Tribunal was not an independent arbiter charged with deciding an issue joined between adversaries. The Tribunal was required to review a decision of the Executive made under the Act and for that purpose the Tribunal was bound to make its own inquiries and form its own views upon the claim which the appellant made."[228]

181. The High Court was speaking of the Refugee Review Tribunal in this instance but in terms that are equally applicable to all merits review tribunals. The decisions that merits review tribunals reach affect individuals as do the judgments of courts but there is a profound difference between the two.

182. Judgments of courts in civil proceedings seek to apply consistent principles and achieve consistent outcomes on similar facts but the basis on which it does so is confined by the pleadings made by the parties and the evidence led by those parties. Documentary evidence may be lodged in a court but, unless it is admitted in evidence, it is not publicly available and remains subject to the implied undertaking or obligation limiting its use. A court does not have the wider responsibility that is the Tribunal's and that was recognised by the High Court in the passage to which I have referred from Applicant VEAL v Minister of Immigration and Multicultural Affairs. That wider responsibility requires it to bear in mind that each administrative decision it makes must not only apply the provisions of the applicable legal framework correctly, it must do so and exercise any discretions consistently across all administrative decisions of that type. Those decisions are not concerned with disputes between or among individuals but with such things as entitlements and rights to receive payments from public revenue, permission or licences to exploit or use public resources, obligations and duties to pay sums of money to public revenue and permissions to be remain in Australia or to be part of the Australian community. The nature of the Tribunal's function explains the rationale of s 35(3). In enacting that section, Parliament has clearly recognised that both the process of review in the form of the hearing of a proceeding and the evidence given before the Tribunal and the documents lodged in the Tribunal or evidence received by it should be open to the public. Given that, like the courts, much of the material on which the Tribunal relies is written material, the public nature of the hearing and the public nature of the material must go hand in hand if the process of review and the administrative decisions themselves is a process that is an open and accountable process.

ANNEXURE E: Have ASIC's searches for the documents within the narrowed request been adequate?

QUERIES RAISED BY MR MATTHEWS AND MR KNAPP PRIOR TO AND AT THE HEARING

183. Mr Matthews and Mr Knapp both submitted at various times during the hearing that ASIC has not identified all of the documents that relate to

Mr Matthews' request. Their concerns on this topic have been expressed in a number of documents. The most comprehensive of those prior to the hearing is Mr Matthews' facsimile to me dated 28 November 2008. He elaborated on his concerns by reference to documents relating to ASIC's investigation of Allstate and related issues. In particular, he obtained documents from Mr Knapp and two others who had complained to ASIC about the Allstate administration and matched those documents with documents or with the timelines shown in ASIC's Schedule. He concluded that many of the documents with which he had been provided by those complaining were missing from the Schedule. Some 20,000 pages were potentially missing,

Mr Matthews concluded. ASIC denies that this is so and has both responded to

Mr Matthews and produced evidence of its searches at the hearing. I will return to these matters.

QUERIES RAISED BY MR MATTHEWS AND MR KNAPP AFTER THE HEARING

184. Mr Matthews sent to the Tribunal a document entitled "Applicant's Supplementary Statement of Facts and Contentions dated 15 May 2009. Mr Knapp sent a similarly entitled document dated 14 May 2009. Both had lodged these documents after the conclusion of the hearing. In a hearing in a civil proceeding, such a step would be most unusual and, if it were to occur, would only occur with leave. In practical terms, the situation is not much different in the Tribunal. As a rule, the evidence and material on which the Tribunal will rely will have been presented by the time the hearing has concluded. During the course of the conferences and any direction hearings, the parties' attention will have been drawn to the need to present all of their evidence and material and their submissions or arguments at each stage and particularly by the conclusion of any hearing. There are occasions, when another line of enquiry will become apparent during the hearing and it is to be expected that the Tribunal will permit that line to be explored. Sometimes, a further line of enquiry will become apparent to the Tribunal in considering its decision and preparing reasons. It is equally to be expected that the Tribunal will ask the parties to comment or consider whether there is further relevant evidence or material as appropriate. Underpinning the expectation is the nature of the Tribunal's task to reach the correct or preferable decision. It cannot do so if the existence of relevant evidence or material has not been drawn to its attention before it reaches its decision and it does not allow it to be presented or ignores the fact of its existence in reviewing the decision. It cannot do so if it knows that there is a relevant line of enquiry and it does not allow the parties to explore it and present the fruits of their exploration. Some may say that this is leading to a never ending review. I would disagree for the end of the process must come with the Tribunal's decision. Once it has given its decision and, assuming that it has exhausted its powers in relation to the review when it does so, that is an end of the matter.

185. In this case, I permitted Mr Matthews and Mr Knapp to make further submissions regarding documents that they claimed ASIC had not produced. I did so without giving notice to ASIC. That is contrary to the procedure I usually adopt but, in view of my task to reach the correct or preferable decision, this was not a situation in which any opposition ASIC might have mounted would have been relevant to my decision. Had the submissions made by Mr Matthews and Mr Knapp appeared to have raised nothing that was not known at the time of the hearing or nothing that ASIC had not already addressed, then, apart from giving ASIC a copy, that would have been an end of the matter. As it turned out, their submissions did suggest that there were files to which ASIC had not referred in its Schedule of Documents. They supported their submissions by reference to publicly available material. On their face, they raised matters that ASIC should be both permitted and asked to address. If there were missing documents, that was relevant to whether or not ASIC had identified all of the documents relevant to Mr Matthews' request. That was relevant to whether or not I reached the correct or preferable decision.

186. In a Supplementary Statement of Facts and Contentions dated 14 May 2009 Mr Knapp directed his attention to the files that he thought ASIC had overlooked in its searches. Mr Matthews did the same in his letter of 15 May 2009 and referred to Mr Knapp's submissions. Both relied on the lists of files created by ASIC under Continuing Senate Order No. 6. That order is usually referred to as the "Harradine Order" and was made on 30 May 1996 on the motion of Senator Harradine. It was amended on 3 December 1998 and requires the Minister to advise the Senate twice a year that an indexed list of the titles of all "relevant files, including new parts of existing files" created in the preceding six months by a department or agency administered by that Minister has been placed on the Internet. The six month periods are dated from 1 January and 1 July each year. Each agency and Department is required to provide, on its Internet home page, an indexed list of titles to all relevant files, including new parts of existing files, created from 1 January 1998. Departments and agencies are permitted to choose whether they maintain online an indexed list of all new files created from that date or maintain online an indexed list of, as a minimum, the most recent year's file creations.

"... means a list in which file titles may be grouped by classifications used internally within departments or agencies, such as 'policy', 'legislation', 'advisings', etc."

"... the name or title of the file, excluding any part of that name or title which would necessarily disclose commercially confidential, identifiably personal or national security matters."

"... files relating to the policy advising functions of the department or agency, including any relating to the development of legislation and other matters of public administration, but need not include:

(a) files transferred to the Australian Archives;

(b) case related files (e.g., personal representations or dealing with the personal affairs of departmental or agency clients or taxpayers); and

(c) files essentially related to the internal administration of the department or agency (e.g., staff or personnel matters)"

188. Mr Matthews prepared a table showing disparities between the files shown on the indexed list published under the Harradine Order and ASIC's revised Schedule of Documents. On my reading of their letters, Mr Matthews has summarised the points each has made in the following table to which I have added the description of the files taken by Mr Knapp from the index and, where he has not shown it and it is available, by me from ASIC's indexed lists:

Financial Reporting and AGM Obligations of Companies in Administration

Financial Reporting & AGM Obligations for Companies External Administration under Part 5.3A - ASIC Discussion Paper

Financial Reporting and AGM Obligations of Companies in Administration - Part 2

Financial Reporting & AGM Obligations for Companies External Administration under Part 5.3A - ASIC Discussion Paper

Financial Reporting Obligations: Externally Administered Companies

189. ASIC responded in a letter dated 23 June 2009. It did so through

Ms Birch, its Administrative Law Co-ordinator. It rejected Mr Matthews' allegations that it had created fictitious files, destroyed files or improperly moved documents between files. It rejected his allegations that its response to his request under the FOI Act had been "a sham". Ms Birch wrote in the letter of ASIC's omission to search certain files:

"The Respondent did not search the lists of files created pursuant to the Senate Order in processing the Applicant's FOI request. The Senate Order requires Departments and agencies to place on their home page an indexed list of files created in the most recent calendar year.

· This is a substantial number of files. For example, for the 6 month period from 1 July to 31 December 2002, there were approximately 150 files created at ASIC.

· The Senate Order does not cover all types of files - for example, it does not cover files transferred to the Australian Archives, case related files or files relating to internal administration.

· In fact, the lists prepared under the Senate Order did not include some of the files found by ASIC in responding to the FOI request - for example, file 2002/24035.

The Respondent has now searched the lists of files created pursuant to the Senate Order for the period of the FOI Request (1 January 2001 to 14 October 2003). As an additional step, the Respondent has also prepared a list of all the files opened by the relevant officers for that period, and searched the names of those files for any additional files that could come within the Applicant's FOI request. These officers were the staff listed in "JDP-2" of the affidavit of John Price, as well as Sue Hansen and Judy Lenart (who opened some files for Michael Chong).

These two additional searches did not uncover any further files, apart from the six identified by Mr Knapp and file PMR2002/24035 (which is part 2 of those files)."

190. Ms Birch went on to summarise her review of the files in these terms:

"PMR2002/24034 - contains 15 documents, of these:

· four (document nos. 3, 4, 5 and 8) are not within the terms of the FOI request:

· one (document no. 11) is a copy of document 244 partially released to the Applicant;

· three (document nos. 12, 14 and 15) are copies of identified documents;

· five (documents nos. 6, 7, 9, 10, 13) are within the terms of the FOI request but are drafts or slightly different versions of identified documents;

· two (documents nos 1, 2) are new documents within the terms of the FOI request.

PMR2003/3171 - contains 18 documents, of these:

· four (documents 16, 20, 21, and 22) are not within the terms of the FOI request;

· ten (documents nos. 17, 18, 19, 23, 24, 25, 26, 27, 29 and 30) are copies of identified documents;

· three (documents nos. 28, 32, 33) are drafts or slightly different versions of identified documents;

· one (document no. 31) is a new document within the terms of the FOI request.

PMR2002/14983 - contains 10 documents, of these:

· nine (documents nos. 34, 35, 36, 37, 38, 40, 41, 42, and 43) are drafts or slightly different versions of the identified documents;

· one (document no. 39) is a copy of an identified document.

PMR2003/13715 - contains 8 documents, of these all are copies or versions of identified documents, (some with annotations), including one partially released document.

PMR2002/24035 - contains 20 documents, of these:

· three (documents nos. 53, 61, and 65) are not within the terms of the FOI request;

· seventeen (document nos. 52, 54, 55, 56, 57, 58, 59, 60, 62, 63, 64, 66, 67, 68, 69, 70 and 71) are copies or versions of identified documents, (some with annotations).

PMR2002/26118 - contains no documents within the terms of the FOI request.

It can be seen there are only three documents that are entirely new, and are not copies or drafts of documents already listed in the Schedule of documents.

· Document 1 and document 2 are emails from Ceyda Ozsayin (an internal ASIC lawyer) to Michael Chong (another lawyer) forwarding documents, and an email. These documents were sent for the dominant (indeed the sole) purpose of providing instructions for Mr Chong to provide legal advice.

· Document 31 is a document on the file of Michael Chong containing notes and summaries on the submissions received by ASIC in response to the Discussion Paper.

The Respondent would contend that these documents are subject to legal professional privilege and exempt under section 42 of the FOI Act."

191. Mr Matthews asked for the hearing to be reopened for the purpose of receiving an affidavit sworn by a senior officer of ASIC regarding the latest documents. He wrote:

"... The ASIC affidavit should cover all the circumstances that explain how the 60 policy documents went missing together with how the important policy documents 312A and 312B (i.e. the minutes and submission to the final meeting of the ASIC Regulatory Policy Group responsible for PS 174) were originally overlooked.

I would expect the ASIC affidavit to include full details of when and on whose authority the following files were created:

· PMR 2003/19660 Insolvency Revision of PS 43 and PS 44 Part 2 and

· PMR 2003/19661 Insolvency Revision of PS 43 and PS 44 Part 3"[229]

192. Mr Knapp expressed his support for Mr Matthews' submission and agreed with him that ASIC should produce its evidence as to its further searches in the form of an affidavit.[230] He suggested that "Prima facie ASIC has manipulated files for the purpose of withholding information that should have been provided to both

Mr Matthews and the Tribunal." He called into question Ms Birch's professional approach to the searches and claimed that ASIC had not taken the allegations of missing documents seriously.

CONSIDERATION OF QUERIES RAISED BY MR MATTHEWS AND

1. Particular issues raised by Mr Matthews and Mr Knapp

193. I will begin with the particular documents whose absence had been queried by Mr Matthews and Mr Knapp during the course of the hearing. I am not concerned with Mr Matthews' claim in so far as it suggests that the documents relating to the complaints about Allstate and the subsequent investigations have not been located. He has decided not to proceed with that part of his request but I remain concerned with it in so far as Mr Matthews complains that documents relating to the development of PS 174 are missing. He has also alleged that ASIC corrupted the development of PS 174 by joining it together with its investigation of Allstate. In his letter to the Tribunal of 19 December 2008, he complained also of the lack of detail provided by ASIC in its Schedule. Mr Matthews supported his contention by reference to ASIC's original estimates that there would be some 31,120 pages meeting his request for documents relating to the Allstate investigation and yet only some 7,800 have been identified.

194. At the hearing, Mr Matthews appeared less concerned about documents that might be missing. He wanted any documents that had begun their existence as policy statements but had gone across to the investigation files but did not develop the argument beyond that.[231]

195. It was Mr Knapp who pursued the issue of missing documents. Given that he had been joined as a party, I think that he was entitled to do that even though it was not his request to ASIC or his application to the Tribunal that had led to our considering ASIC's decision. During the course of his cross examination of

Ms Mirijana Soldatic, who is a paralegal in ASIC's Administrative Law Unit in Melbourne, Mr Knapp sought to question her about the processes that had been followed in processing Mr Matthews' request. Ms Soldatic is the primary decision-maker on FOI requests when her other duties allow.

196. Mr Knapp questioned her about processes in order to establish whether the decisions made on Mr Matthews' request had been made without regard to

Mr Matthews' purpose in requesting the documents. The principle that Mr Matthews' right of access is not affected by any reasons he might have for seeking that access or by ASIC's belief as to what his reasons might be, is true.[232] What is also true is that the Tribunal's review of the decision is limited to a review of the merits of the decision that ASIC has made. It is not a review of whether ASIC followed the correct procedures in reaching its decision or even the basis on which it made its decision. When an agency has refused access to a document on the basis that it is exempt from access under a provision in Part IV of the FOI Act, the Tribunal must decide for itself whether it is exempt. It must not take account of the person's reasons for requesting access nor of any other consideration extraneous to Part IV. If the decision-maker did take account of such matters, it should not have but the Tribunal has no interest in enquiring whether it did so or not. Its interest lies in not doing so itself.

197. Mr Matthews asked for explanations as to how ASIC came to omit any reference to the six files he had identified from its indexed list published under the Harradine Order. He asked whether they had been destroyed and by whose authority file nos. PMR 2003/19960 and PMR 2003/19661 came to be omitted from the indexed list. He wanted to know if the files had appeared on ASIC's electronic database, EPSOM and ASCTEC and, if not, on whose authority they had been deleted.

198. It is not my role to conduct an enquiry as to the manner in which documents came to be omitted from the indexed list published under the Harradine Order or on whose authority files are made or deleted from the computerised records or whether they were deleted at all. That is not to say that omissions are not relevant. They are relevant for they call into question the adequacy of the searches that have been conducted. So too may particular comments that may be made in the course of the search. Regard must be had to the whole picture. While I will return to some of the things that I regard as coming within that whole picture, I want to consider a couple of matters that Mr Matthews and Mr Knapp have raised but which, on this occasion, I do not think add to that picture in this case.

199. If it were suggested that the search had been curtailed by reference to what the agency thought a person wanted rather than directed by reference to what had actually been requested, then an exploration of what it thought might be relevant. This is not such a case. I do not consider the fact that an officer of ASIC, when asked for documents, asks who the person requesting them is - "Some student/ academic/ disaffected lawyer or accountant or what?"[233] - amounts to any suggestion that the documents were not properly looked for and identified.

200. Mr Knapp explored Ms Hansen's statement in her response to

Ms Soldatic that "I will have to sort out my PMR 2003/1792 before I can send it to you and this may take some time given its current state and how busy I have been."[234] Referring to Mr Knapp's particular concerns about Ms Hansen's response to

Ms Soldatic, I do not see any attempt on her part to avoid location and production of the relevant documents. I sense frustration in Ms Hansen that someone is distracting her from the work that she must do and that is the primary focus of her day. That sense of frustration might have been heightened by her having just returned from leave; a fact referred to at the beginning of Ms Hansen's email. At the same time,

I sense her recognition that compliance with a request under the FOI Act, or at least assisting others to comply with it, is equally part of the work she must do. In view of her subsequent reference to her not sending file PMR 2003/15535 to Ms Soldatic on the basis that it dealt with matters following the publication of PS 174 and not its rationale and with Ms Soldatic's advising her that she wanted to "round up the relevant material" pending Mr Matthews' request "becoming valid", I do not see any basis for my concluding that Ms Hansen made any attempt to limit the material identified as coming within the request. Her reference to "sorting out the file" should be read as no more than tidying it up and putting the documents on the file in an order and in a manner that looked as if some regard had been paid to ASIC's record management policy. I do not read it as her attempting to cull or edit the file in some way.

201. There are other matters raised by Mr Matthews and Mr Knapp that I do see as relevant in coming to a view regarding the question whether ASIC's searches were relevant. Mr Knapp noted that Ms Hansen was an action officer and yet there was no reference to any mail or emails she had received as action officer or of any legal advice she had received from investigations officers. As I understand his submission, Mr Knapp felt that documents were missing from the files because it was unlikely that the RPG would have "signed off" on the draft PS 174 at its meeting on

7 May 2003 when a Regulation Impact Statement (RIS) had yet to be prepared. The first reference to that is at document 327. The RIS continues in draft form up to and including 26 May 2003 and takes on its final form at document 332 when it is sent by email from Ms Hansen to Mr Price and another. He found it hard to believe that the RPG would have "signed off" when it had yet to see the draft RIS. As I understand his submission, he thought that the draft RIS and the draft PS 174 could not have received proper consideration unless it had been put to some sort of meeting between 7 May 2003 and its being finalised on 27 May 2003. There must be minutes of meetings, draft agendas and agendas.

202. ASIC had produced documents 312A and 312B after it had produced its Schedule of Documents. Document 312A, which is dated 28 May 2003, is described in the Schedule of Documents as "RPG submission for meeting No 233 - 07/05/03 (Final version)". Document 312B is described as RPG meeting minutes of meeting number 233 and is dated 7 May 2003. The date of 28/05/2003 appears next to document 312A but, having read that document, it seems to me that its date is actually 7 May 2003 as it is for document 312B. These are the documents referred to at [...] above. I have read both documents and also followed the sequence of documents that came after them. That sequence takes me from them to documents 325,[235] 326,[236] 327,[237] 328[238] and so on.

203. Mr Knapp has expressed concern that the undated Document 312, which is described as an "RPG submission for meeting No 233 - 07/05/03" is shown in the Schedule of Documents as 45 pages in length whereas Document 312A is described as 94 pages in length. Document 312 is not described as a draft but there is a great disparity in their lengths. Mr Knapp questioned how this could be so given that Document 312A is dated some three weeks or so after the RPG held its meeting on 7 May 2003. During the course of the hearing, Mr Niall gave a further description of Document 312A as:

"... the final RPG submission for meeting 233 which was considered on 7 May 2003 and includes attachments. The document includes annexures or attachments which, according to the document itself, was updated on 28 May 2003 to include a copy of the final RIS. I'm instructed that there was no meeting of the RPG on 28 May but there was a meeting of delegates which has been the subject of evidence, so 312A includes attachments and 312B is in its entirety. ..."[239]

204. On the basis of the evidence of Mr Price, I find that there was a meeting of the delegates on 28 May 2003. Having read Document 312B, I am satisfied that, at its meeting on 7 May 2003, the RPG left certain matters to the delegates' meeting to be finalised. I am satisfied Document 312A reflects that and, as Mr Niall said, includes attachments. This accounts for its being a longer document than Document 312 and for its being changed after the RPG held its final meeting on the subject.

205. On their own, these individual instances of concern to which Mr Matthews and Mr Knapp referred me would not cause me a great deal of concern. For the reasons I have given, I have found they are explicable in their context. Viewed more broadly, missing documents, apparent gaps in the sequence of documents or documents not identified at the outset may raise doubts that all of the documents have been located and identified in the Schedule of Documents. Locating documents in dribs and drabs may increase the doubts as may the fact that documents are only found when the person requesting access points out logical gaps in those that have been identified either by reference to their description or, where access has been given, by their contents.

206. That is not to say that an agency should refrain from searching for documents when its attention is drawn to a possible line of enquiry either from within its organisation or by the person seeking access. It is not to say that an agency should not disclose further documents if it discovers them after its initial searches. They should do both just as ASIC did and it is to be commended for doing so. Ms Birch thought to go beyond the mere description of document 1126 to look at its contents and to arrange further searches of ASIC's electronic data bases. ASIC revealed its searches and the further documents it found voluntarily even though the matter was well advanced in the Tribunal. It also responded to the analyses by Mr Matthews and Mr Knapp by looking further and revealing the results of its searches. All of the steps taken by ASIC are the proper and only things to do.

1. Relationship between searches under the FOI Act and records management

207. As commendable as ASIC's response has been, my concern is that the way in which the documents have been located has given its searches the air of being somewhat piecemeal. In saying that, I do not wish to be thought of as criticising either Ms Soldatic or Ms Birch. Unlike Mr Knapp, I do not consider that either, and particularly Ms Birch, has done anything other than directed her attention to trying to find all of the documents requested by Mr Matthews in a professional and proper manner. Mr Matthews' request covered an extensive number of documents and a number of officers who had responsibility for their creation and handling. Between them, Ms Soldatic and Ms Birch found an extensive number of those documents before they were assisted by Mr Matthews and Mr Knapp.

208. I think that the reason for their searches having the air of being piecemeal may lie in ASIC's internal guide when it tells its officers:

"Under the FOI Act ASIC has an obligation to search its files and information systems (whether created or received by ASIC or its predecessors) to ascertain whether documents coming within the terms of the request are in the possession of ASIC. That search is not restricted to documents in the 'receiving' office but to ALL ASIC offices. Naturally, on occasion, it will be clear from the terms of the request that the document will only be relevant in the regional office. However, this would be the exception and not the rule!

How each office arranges the conduct of the search for the material sought by the applicant is a matter for itself. The decision-maker has responsibility for ensuring that searches have been carried out in an appropriate manner. The following steps however should be taken:

(1) a search of EPSOM and ASCTEC. An essential part of the search is talking to the officer responsible for the subject matter on the file about the existence of other documents that might come within the terms of the request;

(2) where a significant request is received, eg, a request that covers a large number of documents, or a request of [sic] which encompasses documents held by ASIC officers in various portfolios, the decision-maker should arrange a conference with staff with possession of the documents and their managers to inform them of the importance of the matter and to help identify all documents, and to generally facilitate the efficient handling of the request; and

(3) it is crucial that the process of searching for documents is recorded on file so that the decision maker can be confident that all documents that may come with [sic] the terms of the request have been identified. To this end, if other officers have been asked to undertake a search they should be asked to confirm what searches they have undertaken, and whether any documents have been found. It is preferable for the confirmation to be recorded in writing (eg e-mail).

It should be remembered that the decision maker may have to swear an affidavit to establish the adequacy of the search process."[240]

209. In so far as it goes, it seems to me that the internal guide is correct but it also seems to me that it does not go far enough to assist those who must locate documents. It refers to two ways in which the documents can be found: searching the EPSOM and ASCTEC data bases and talking with action officers. Those enquiries are imperative but what is also imperative is a knowledge of the manner in which ASIC keeps its records, why it keeps its records and for the length of time it keeps its records. That is to say, it is imperative that those searching for documents have an understanding of the sorts of records that ASIC officers are required to keep, the manner in which they are kept and whether they are retained. It is imperative that they know the manner in which records are classified, whether by functions, activities or otherwise, so that they can identify the documents they seek.

210. When searches are conducted against a background of that understanding, it is more likely that ASIC will conduct its search in an ordered manner most likely to find documents. Its chances of doing so are increased if ASIC officers, who create the records, are made aware of the records they must make and why they must make them and if they and the officers who maintain the files are made aware of the way in which those records must be categorised and described. Once that understanding is conveyed to the person requesting access, it is more likely that the person will be satisfied that the searches for documents have been adequate.

1. The regulation of records management: general principles

211. The FOI Act is not designed to ensure that agencies and their officers maintain appropriate records in an appropriate fashion. Instead, it assumes that agencies will be able to identify and locate documents in their record management systems should they receive a request for access under it. Creation, management and retention of those documents is regulated by the National Archives of Australia (Archives) under the Archives Act 1983 (Archives Act). Responsibility for the oversight of Commonwealth record-keeping is among its functions.[241] In particular,

it provides advice and other assistance to Commonwealth institutions regarding the creation, keeping and management of current Commonwealth records in an efficient and economical manner. A "Commonwealth institution" includes an "authority of the Commonwealth",[242] which, in turn, includes a body established for a public purpose under an Act.[243] ASIC is an example of such a body.

212. The Archives Act does not refer to a "document" but to a "record" which includes a document but is also so much more. It encompasses an object that is, or has been, kept by reason of any information or matter that it contains or can be obtained from it by reason of its connection with any event, person, circumstance or thing.[244] A "Commonwealth record" is a record that is the property of the Commonwealth or one of its institutions or deemed to be so in certain circumstances. It does not include a record of exempt material or a register or guide relating to Archives.[245] A "current Commonwealth record" means "... a Commonwealth record that is required to be readily available for the purposes of a Commonwealth institution, other than purposes under this [Archives] Act."[246] For the purposes of this case, it is enough to note that a Commonwealth record includes a record of the Commonwealth or of a Commonwealth institution.[247]

213. Part V of the Archives Act regulates dealings with Commonwealth records. Commonwealth records may not be destroyed or disposed of or altered unless that action is required by law, is done with the permission of Archives, is in accordance with a practice or procedure approved by Archives or is in accordance with a normal administrative practice not disapproved of by Archives.[248] Archives issues directions relating to record management. Among them is the Designing and Implementing Recordkeeping Systems Manual (DIRKS). It explains the need for the orderly management of Commonwealth records:

"Good government requires good recordkeeping. Good recordkeeping supports efficiency and accountability through the creation, management and retention of meaningful, accurate, reliable, accessible and durable evidence of government activities and decisions. Good records are necessary for government to keep track of what it has done, so that its future activities can be pursued on the basis of a full and accurate knowledge of what has occurred and what has been decided in the past. Retention of the corporate memory of government, in the form of records, helps public servants perform their duties efficiently and ensures that audit trails necessary for democratic accountability and transparency are maintained. Good recordkeeping also helps to protect the legal, financial and other interests of government. Ultimately, good recordkeeping saves the government, and hence the community, money. Good records are vital corporate and national assets and good recordkeeping is essential for a reliable and durable long-term historical record.

In the past good recordkeeping was, by and large, second nature to public servants. The public service of the past, with its emphasis on process, hierarchy, and employment of filing clerks and other administrative assistants, ensured that good records were created and maintained. As we move into the twenty-first century such certainties can no longer be relied upon. Now governments emphasise outcomes and outputs over processes and hierarchies. Public service recruitment patterns, staff induction and training procedures, and career paths are now very different from those of 20 or 30 years ago. We cannot assume that public servants appreciate the importance of good recordkeeping or know how to keep good records. The trend towards semi-autonomous work groups and flatter organisational structures has contributed to this situation.

In recent years the spread of electronic systems has exacerbated the drift towards ad hoc or substandard recordkeeping practices. The adoption of word processing, email and multi-media applications has led to a situation where the essential evidence of government decisions and transactions is often kept in the hard drives, email in-boxes and shared folders of individual public servants or work groups. This form of recordkeeping does not meet the requirements for full, accurate, reliable, accessible and durable evidence of government activity. Moreover, such practices pose unacceptable risks to the capture and management of essential evidence. Not only may individual public servants delete records without giving adequate thought to whether those records need to be retained, but there is also the distinct possibility of large numbers of records being lost each time an organisation's computer software or hardware platform is upgraded.

214. DIRKS is an eight-step process for agencies to use to improve their records management and information management practices, including the design and implementation of new records management systems. The methodology is compliant with, and expands on, the methodological framework of the Australian Standard for Records Management, AS ISO 15489 - 2002. Among other matters, DIRKS enables agencies to:

· develop a business classification scheme that identifies, labels and defines the unique functions and activities of an organisation

· construct agency-specific classification tools such as a functions thesaurus

· compile a functions-based records disposal authority for records unique to an agency

· compile a general disposal authority for records relating to common administrative functions

· adopt appropriate metadata standards for control and retrieval of records

· design or select records management software products and other electronic business information systems that meet an agency's requirements to create, control, retrieve and dispose of records.

215. AS ISO 15489 is an Australian and international standard providing guidance on creating records policies, procedures, systems and processes to support the management of records in all formats. Archives has endorsed it for use in relation to Commonwealth records held by Commonwealth institutions and it provides the basis for all the Archives' records management standards, policies and guidelines. AS ISO 15489 has two parts:

· AS ISO 15489.1: Records Management - Part 1: General

· AS ISO 15489.2: Records Management - Part 2: Guidelines

216. Part 1 of the standard provides an organisational framework for records management, and specifically sets out details of the fundamental principles of DIRKS. Part 2 builds on those matters as well as providing additional guidance about monitoring and auditing records systems to ensure that organisations meet their legal and accountability requirements. Further guidance on training programs ensures that the functions and benefits of managing records are widely understood in an organisation.

217. Whether documents can be identified may depend on whether the name or names of the files suggest that they may contain documents relevant to those requested under the FOI Act. If the names were chosen at random or according to the filemaker's whim, the task of locating documents and managing the records generally would be extremely difficult. Archives has introduced the Australian Governments' Interactive Functions Thesaurus (AGIFT) with an eye to introducing some consistency in the nomenclature used in the maintenance of Commonwealth records. It describes business functions carried out at all three levels of government in Australia. It has chosen to describe 25 functions and to identify them as high level functions. Justice Administration, for example, is one of the 25. Archives describes it as:

Developing, interpreting and applying legislation, regulations or by-laws. Regulating the conduct of individuals, business and government, to conform to agreed rules and principles. Establishing programs and services to support the operation of the justice system.

218. For each high level function, AGIFT sets out second and third level terms together with non-preferred terms and related terms. For each preferred term, there is a note describing the range of activities that it covers. Among the preferred terms identified under the high level function Justice and Administration is "Associations and corporate law". The note referring to that term states:

"Administering the body of law that relates to companies or other organisations that have a distinct legal identity from that of their members. Regulating the formation, governance and dissolution of such organisations and establishing the limits of their powers or liability."

219. AGIFT is the document under which Archives has introduced standard nomenclature at the general level but that is a level too general for the naming and classification of the files in which records are maintained or the classifications under which they are stored. Consequently, Archives has also prepared a document entitled "Developing a Functions Thesaurus". It provides advice on designing, constructing and maintaining a functions thesaurus to assist with classification and other records management processes in an organisation. Archives intends its document to be read with other publications it has prepared including DIRKS and to be based on an analysis of the agency's business activity.

220. In general terms, s 24 of the Archives Act provides that a person must not destroy or dispose of, damage or alter or transfer the ownership or custody of a Commonwealth record unless required to do so by any law, with Archives' permission, in accordance with a normal administrative practice (other than one of which it has been notified Archives' disapproves) or for the purpose of placing a Commonwealth record in the custody of the Commonwealth or of a Commonwealth institution entitled to it. Archives has issued an Administrative Functions Disposal Authority (AFDA) covering administrative records common to most Commonwealth institutions. It has also issued a number of General Disposal Authorities related to particular types of documents or to documents that are duplicated or captured elsewhere. Archives issues Records Authorities to individual Commonwealth institutions directed to regulating the retention and disposal of their records relating to their core business functions.

221. On the basis of Ms Soldatic's oral evidence, I find that ASIC has a record-keeping policy. That record-keeping policy is set out in the Supplementary T documents.[250] It speaks in general terms of the principles that must be followed e.g. the need for records to be available, accessible, have context, be reliable, authentic, complete and useable and be maintained through time.[251] ASIC officers are directed to the Archives Act 1983 (Archives Act) (particularly s 24) and to the Australian Standard AS ISO 15489-2002 for Records Management and the Commonwealth Protective Security Manual 2000.[252] Their attention is also drawn to the Evidence Act 1995 and the Acts Interpretation Act 1901, as legislation regulating the evidentiary value of information, and the Corporations Act and ASIC Act, as legislation under which ASIC is accountable for its record-keeping. It could equally have been drawn to legislation such as the Financial Management and Accountability Act 1997 as an example of legislation that requires agencies to meet certain legal and organisational record-keeping standards.

222. The record-keeping policy requires records to be kept on paper files and for files to be registered in an electronic management system. Records that are received or created in an electronic format must be printed and filed in the physical file.[253] Records must be stored in the most cost-effective manner possible, protected, secure and accessible for so long as they are required to meet the business and accountability needs and community expectations and transferred to Archives if they are of continuing value. ASIC's records must be stored according to a standard described as "Storing to the Standard: Guidelines of Implementing the Standard for the Physical Storage of Commonwealth Records" and other guidelines that are not further identified in the record-keeping policy. Reference is also made to a document entitled "Procedure - Recordkeeping Security and Storage of Files".

223. Disposal of records is dealt with at [4.2] of the record-keeping policy where it is recognised that records can only be destroyed in accordance with disposal authorities issued by Archives.

224. Particular aspects of record-keeping are dealt with in other more specific documents in the Supplementary T documents. ASIC officers are told that a file should provide a complete history of an activity from initial receipt until it is completed. Determination of which records must be registered is described as "... a risk management decision for each business program based upon accountability and legal requirements for the specific activity."[254] They are also told that:

"Records provide evidence of business activity. Regardless of their format, paper based or electronic, records enable you:

· show the extent of your responsibility for decisions taken and

· show the order of events and your role in them.'[255]

225. If the record relates to work, is written or sent in the course of work, must be acted upon, is external correspondence received or is used for work or to make a decision in the course of work, officers are told to make a record of it.[256]

A record must be made "... of work-related discussions where business decisions are made or directions given ..."[257] It matters not whether the record is in paper or electronic form.[258] Officers are also told what not to put on the file. That includes personal and advertising material, documents relating to normal administrative practice, material that is not ASIC's property because, for example, it has been seized in the course of an investigation.[259]

226. Together, ASIC and Archives have developed a specific Records Authority dated December 2007.[260] It sets out:

"... the requirements for the retention or destruction of records for ASIC's core business functions. ...

This Authority uses a classification scheme based on an analysis of the business of ASIC. It takes into account the agency's legal and organisational recordkeeping requirements, and the interests of stakeholders of both the agency and of the National Archives. It provides a framework that may be used as a guide when creating and managing records that document this function.

This Authority gives ASIC the permission, required under the Archives Act, for the disposal of the records described. The Authority sets out those records that need to be retained as national archives and the minimum length of time that other classes of records need to be kept. Retention periods are based on an assessment of business needs, broader or organisational accountability requirements and community expectations.

ASIC can use the following tools to dispose of their records:

· this Records Authority covering its agency specific records;

· general disposal authorities, such as the Administrative Functions Disposal Authority (AFDA), that covers functions and records common to every Commonwealth agency; and

· normal administrative practice (NAP) which allows for the destruction of records where the records are duplicated, unimportant or for short-term use only.

As changes of circumstances may affect future recordkeeping requirements, the periodic review of this Authority is recommended. All amendments must be approved by the National Archives.

227. ASIC's Records Authority identifies eight classes of records: commercial services, compliance management, consumer protection, corporate and financial regulation, deregistered company property, financial management (unclaimed money), international relations and investigation and enforcement. Details of records coming within each class are given. Each class begins with a description. In the case of Corporate and Finance Regulation, it reads:

"The function of regulating entry to the corporate and finance sector. Includes managing the lodgement of annual returns, licensing of financial services, financial markets and clearing and settlement facilities, registration of managed investment schemes, auditors, liquidators and authorised assessors, and processing changes of licence, registration and participants' details. Also includes managing applications for exemptions, education and information programs and policy development.

228. Each class of records is then divided into sub-classes by reference to the particular activities carried out by ASIC or by reference to its functions. The Corporate and Finance Regulation class, for example, begins with "Administrative Hearings" which it describes as "The activities associated with conducting administrative hearings. Includes notifications and arrangements, the conduct of hearings, and preparation of statements of finding"[263] and goes on to describe the records in that sub-class and the disposal action in relation to them.

229. Of interest in this case are the sub-classes of Committees (assuming the RPG to be a committee), Policy and Policy Development:[264]

The activities associated with the managing of committees and task forces. Includes the committee's establishment, appointment of members, terms of reference, proceedings, minutes of meetings, reports, agenda etc.

Records of external and internal committees relating to the corporate and finance regulation function, includes:

Working papers and associated administrative records of committees, including:

The activities associated with developing and establishing decisions, directions and precedents which act as a reference for future decision making, as the basis from which the organisation's operating procedures are determined.

For the development of industry wide policy statements and guidance for participants in the corporation or finance sectors, use CORPORATE AND FINANCE REGULATION - Policy Development.

For the publication of policy, use PUBLICATION - Production.

Records documenting the development and establishment of policy relating to the corporate and finance regulation function. Includes:

Working papers associated with the development of policy relating to the corporate and financial regulation function. Includes minor drafts and copies of sample policies.

The activities associated with developing industry wide policy and guidance documents, such as policy statements and guides, to regulate or guide industry and professionals. Includes the project management of the process, assessing existing policies, developing options for proposed reforms, drafting and issuing new or amended policies.

For the development of policy for use by agency staff, use CORPORATE AND FINANCE REGULATION - Policy.

Final policy statements and practice notes relating to the corporate and finance regulation function.

Submissions received by the agency relating to the development of policy statements and practice notes.

Records documenting the development of policy statements and practice notes relating to the corporate and finance regulation function. Includes:

230. ASIC's Records Authority does not specify the way in which ASIC must store its records and, in particular, the way it names its files. It is reasonable to expect, however, that it would file and maintain them in a way which is consistent with AGIFT and any functions thesaurus that it may have developed in relation to its own business functions and activities. Consistency makes it easier for it to identify and separate from each other, those records that it may dispose of and those it must keep either for a period of years after the occurrence of a specified event or permanently. It makes it easier for ASIC to identify those documents that have been disposed of if a request has been made for it under the FOI Act.

231. Normally, the indexed files tabled in the Senate twice each year under the Harradine Order and the statement made under s 8 of the FOI Act regarding the categories of documents maintained in the possession of the agency would not reveal any documents that the agency is not otherwise able to identify from its main records. Those revealed under the Harradine Order are, after all, only the most recent files created by the agency. The statement required under s 8 of the FOI Act will presumably reflect categories already recognised under its record-keeping system.

232. Neither the Archives material nor ASIC's record-keeping policy refers to numbering documents on the file, noting the number on an index sheet attached to the file or numbering the individual folios comprising those documents. It is a time consuming activity no doubt avoided by countless numbers of public servants over countless years. When records are maintained electronically, there is probably a practical difficulty in maintaining what was a most tedious activity. One very great advantage of numbering reveals itself when searching for documents and when trying to decide whether all that should have been found have in fact been found. Numbering enables the gaps to be seen. A gap does not necessarily mean a missing document for it may be that it has been disposed of in accordance with AFDA or with ASIC's own Records Authority. The index sheet will identify the document by reference to its number and its description. A gap in the file numbers is the same.

A reference to its title should indicate its contents and a reference to the Records Authority may reveal that it was properly disposed of.

233. In this case, Ms Soldatic could not recall how the files numbered PMR 2003/1792 and PMR 2003/15545 were maintained. An examination of the documents from PMR 2003/1792 and of the documents generally, over which exemption is claimed, reveals that its folios do not carry numbers. The presence or absence of folio numbers and of indices are only two of the things that are relevant in looking to see whether all of the documents have been found.

234. In this case, I have the documents from which I can sketch a framework of events, the evidence of Mr Price setting the sequence of events in relation to categories of documents and the Schedule of Documents which carefully sets out the file on which the documents have been located as well as their description. I view them against the background of record-keeping policies to which

235. What I see is a cohesive pattern of documents that appear to take the development of PS 174 through its final stages. It cannot be expected that a file will show every thought of every officer who has ever turned his or her mind to a matter and that is not what is required of them under ASIC's record-keeping policy or under the principles established by Archives. An agency is responsible for maintaining records that enable it, and those to whom it is accountable, to know what it has done and why it has done it. That does not mean keeping every piece of paper or electronic record but it does mean keeping those that enable it to achieve this end.

236. When viewed against the record-keeping policy and ASIC's Records Authority, it is easier to understand why there may not be any draft meeting agendas, agendas or draft minutes. According to the Records Authority, they are destroyed when the reference ceases[265] and the reference to the RPG had ceased by the time

Mr Matthews made his request in 2006. So too are working papers associated with the development of policy relating to ASIC's corporate and finance regulation in areas other than the provision of industry wide policy statements and guidance for participants in the corporate and finance sectors. Working papers are understood at entry 16786 to include minor drafts and copies of sample policies. Where the policy development relates to those wider issues, drafts, research, policy proposals and consultation papers are retained for seven years.[266] The obligation to retain those records does not limit the disposal of records relating to the work of a committee at which those drafts, research, policy proposals and consultation might have taken place. The intention is to retain the documents that show the path taken in the development of the policy itself for seven years and any submissions made to ASIC in relation to that policy development for a further 13 years beyond that. It is not the intention to retain records of the administrative steps, such as the calling of a meeting, that must be taken to move the policy along that path but which do not themselves have any impact upon its development.

237. When this background is understood, the absence of draft agendas and agendas is explicable and is not evidence of a "cover up" or of inefficiencies in record-keeping. It must also be remembered that decisions can be taken in various ways. A person may, for example, authorise another to take a certain step provided other steps are first taken. Another may require assurance that the steps are taken before giving the authority for the final step. Yet another may want to take all the steps him or herself and authorise nobody else to do so. The same is true of a committee as much as it is of an individual.

238. Bearing these matters in mind, I have looked carefully at the documents relating to draft PS 174 from the time it was considered by the RPG at its meeting on 7 May 2003 until it was issued. I accept that an RIS had to be prepared in that time. Bearing the contents of the documents in mind, and I cannot reveal them,

I am satisfied that the documents identified in the Schedule of Documents do not reveal any logical gap in the sequence of events they record or are evidence of.

239. I have the evidence of Ms Soldatic regarding her emails to five ASIC officers seeking their assistance to find documents relevant to Mr Matthews' request. From those officers, she obtained the names of four other officers and, from one of those, she was given the references to three files. I also have Ms Soldatic's evidence regarding her request to ASIC's Record Management area to search ASIC's record management systems - EPSOM and ASCTEC - for the three files. Exhibit MS-19 to her affidavit sets out the files Ms Soldatic had located in relation to the first part of

Mr Matthews' request. It also included the estimated number of documents in those files based on her discussion with Mr Greg Adams. Ms Soldatic has included at Exhibit MS-16 the results of searches she had made on EPSOM for documents coming within the second part of Mr Matthews' request. The three results related to Allstate, Beaconsfield Gold and Otter Gold respectively. There are no results for any searches made on EPSOM for documents coming within the first part of the request. Given that our memories can be faulty, it would seem to me to have been preferable for a search on ASIC's electronic data bases to have been carried out in addition to enquiries being made of action officers. Given that the files disclosed under the Harradine Order should be a reflection of a particular group of ASIC's files, it is to be expected that a search of its files would have revealed those later identified by

240. I note that Ms Birch gave evidence about documents that ASIC located after Mr Matthews had provided tables of documents that he said had been omitted from its Schedule of Documents. They were documents comprising complaints that he and another had made to ASIC and its responses. Ms Birch gave evidence that she made enquiries regarding ASIC's records and located 19 documents. Of those, ASIC had already identified nine of them in the Schedule of Documents and I note that each relates to the Allstate investigation and is outside the scope of documents now pursued by Mr Matthews.[267]

241. I have read each of the five documents that are said not to fall within the scope of Mr Matthews' narrowed request. His narrowed request focuses on the rationale for, and implementation of, CO 02/968 and PS 174. I agree that the documents do not come within its scope. The documents take the form of either letters written by Mr Matthews to the Chairman of ASIC, a response written on his behalf to them or documents relating to the administrative processing of the letters. There are two letters from Mr Matthews. The longer of the two does not come within the terms of the request because it is focused on Allstate. At first glance, the shorter could arguably be thought to come within it. Although it refers to Allstate, it does so as an example only and otherwise informs ASIC's Chairman of Mr Matthews' request under the FOI Act in relation to CO 02/968. It seems to me, though, that this is not a document that can be properly characterised as focusing on the implementation of

CO 02/968. Rather, it is properly characterised as focusing on a request made under the FOI Act.

242. I have also read four other documents that Ms Birch located and to which she referred in the table at JVB-5 to Exhibit 7. They are found in JVB-7 to the same affidavit and relate to the investigation into Allstate. Therefore, they do not come within the scope of documents that Mr Matthews now seeks. I note that

Ms Birch could not locate one of the documents to which Mr Matthews referred.

243. On the basis of her evidence, I also find that Ms Birch identified a significant number of documents while she was preparing the material that ASIC would file in this proceeding. At that time, document 1226 was the last document that had been identified by ASIC as relevant to the request. As she said in her affidavit:

"Upon examining document 1126, its exact nature was not clear to me.

I therefore asked Joe Zubic and Greg Adams to assist me. Greg Adams conducted a further search of the electronic drive kept in respect of the Assignment investigation and provided me with further information that enabled me to ascertain the nature of document 1226. In the course of this examination of the electronic drive, I noticed reference to some documents

I could not recall from my examination of documents 1 - 1126. Consequently, these documents were included in the Schedule of Documents ..."[268]

244. The documents Ms Birch identified are recorded as documents 1227 to 1322 in the Schedule of Documents. They relate to the Allstate investigation and are not relevant from that point of view but are relevant from another. Their relevance lies in the fact that they show that ASIC, and Ms Birch in particular, continued to think about Mr Matthews' request and what it encompassed. They continued to be sensitive to clues that might lead them to make further enquiries to locate documents and did make those enquiries. When Mr Matthews drew documents to their attention, they returned to their files to check his claims that they had missed some of them.

245. I cannot make a definitive finding that ASIC has found all of the documents that Mr Matthews has requested. In a case such as this where the number of documents that were found extended to 1,322 documents, I think that it would be difficult to make such a finding. What the evidence does demonstrate to me is that, with some assistance from Mr Matthews and Mr Knapp, ASIC took all reasonable steps in this case to find the documents coming within the request. Its searches were perhaps not as comprehensive as might have been hoped for at the beginning but any lack was not caused by lack of good will or of professionalism. The sheer volume of documents was overwhelming. ASIC proved itself to be responsive to matters raised by Mr Matthews and Mr Knapp. It continued to make its own enquiries regarding the existence of further documents. When I have regard to the substance of the 3,500 or so documents that remain in issue, I do not see any gaps in the logical flow that I would expect to see in documents of the sort requested.

ANNEXURE F: Background to the documents requested under the FOI Act

BACKGROUND TO DOCUMENTS RELATING TO ASIC's POLICY DELIBERATIONS

Granting relief from specified obligations by Class Orders

246. ASIC has been established with a wide range of powers and functions in relation to monitoring and promoting market integrity and consumer protection of the financial and payment systems in Australia. It has an advisory role and is given specific functions and powers under the Corporations Act 2001 (Corporations Act).

I have set out these matters in more detail in Annexure G to these reasons but note that, under s 341 of the Corporations Act, ASIC may make an order in respect of a specified class of companies, registered schemes or disclosing entities, relieving certain persons or entities from certain requirements. It may act on its own initiative without application being made to it. The persons who may be relieved of specified obligations are directors, the companies, registered schemes or disclosing entities themselves and auditors of those companies, registered schemes or disclosing entities.[269] The requirements in respect of which ASIC may give relief are all or any of those specified in Parts 2M.2, 2M.3 and, except in relation to Division 4, Part 2M.4. The order may be expressed to be subject to conditions and may be either indefinite or limited to a specified period.[270]

247. Part 2M.2 of the Corporations Act requires all companies, registered schemes and disclosing entities to keep financial records and, in some instances, financial reports. Most have to prepare them annually although some have to do so more often. Part 2M.3 regulates the preparation of financial reports and directors' reports. Part 2M.4 regulates the appointment and removal of auditors for a company or registered scheme.

Extension of time for compliance for holding annual general meeting

248. Under s 250N of the Corporations Act, a public company[271] must hold its annual general meeting (AGM) within 18 months of its registration and, thereafter, at least once in each calendar year and within five months of the end of its financial year.[272]

249. ASIC may extend this period if the company applies to it under s 250P. The company must apply before the end of the period when the AGM is due. ASIC may impose conditions on any extension it grants and the company must comply with them.

250. On the basis of the evidence of Mr Price, who was the Acting Executive Director, Regulation Directorate of ASIC and formerly Assistant Director, Regulatory Policy at the time he gave evidence, I find that ASIC has established the Regulatory Policy Group (RPG). The RPG has seven members comprising Commissioners, ASIC executives and representatives from ASIC's Office of General Counsel. ASIC delegates particular functions and powers to the RPG. All of its members have extensive operational and policy experience. Its role is to consider and settle issues of regulatory policy that fall within the scope of its powers and discretions. That policy relates to high level matters and provides overarching guidance regarding discretionary matters. In particular, it provides guidance to ASIC staff in relation to:

1. novel applications seeking relief from provisions of the ASIC Act and raising new policy considerations or a change to, or reversal of, existing ASIC policy;
2. policy relating to discretionary matters in general; and
3. "Matters arising from law reform initiated by Government."[273]

251. The RPG meets each fortnight or so but there are arrangements in place that enable it to reach a decision on urgent matters that arise between meetings. In the ordinary course of events, the RPG considers and decides matters based on papers submitted by action officers from ASIC's operational units. These papers are known as "RPG submissions".

252. RPG submissions are generally prepared by an ASIC officer in consultation with other ASIC officers in other operational areas of the organisation. Generally, they analyse the relevant issues, outline any consultation that is proposed with outside industry and consumer groups, outline the outcome of any consultation that has taken place with relevant ASIC operational units, set out various courses of action that can be adopted and recommend one of them. RPG submissions may also include relevant background information including statistics, consideration of relevant policy and commercial imperatives as well as any obstacles that may present themselves regarding implementation of the courses of action. Once a draft has been prepared, the ASIC officer responsible for it submits it to an authorising officer to ensure that it is of the appropriate quality.

253. In matters of particular significance, ASIC's Commissioners may be separately briefed. The RPG submission is considered at a meeting with "robust and frank exchanges between its members, the relevant action officers, and other interested internal stakeholders, culminating in its ultimate decision making."[274] Once the RPG has approved a draft policy, ASIC officers consult with industry and consumer representatives. They assess the responses they have received during that consultation and review the policy. A further RPG submission is prepared incorporating the consultation and review. Once the RPG has considered the revised submission and come to a decision, it implements its decision by publishing a policy document.

ASIC's Office of General Counsel and other officers providing advice on legal issues

254. On the basis of the affidavit Ms Judith Birch, the Administrative Law Co-ordinator in ASIC's Melbourne office, I have made the findings of fact in this section of my reasons regarding the Office of General Counsel (OGC).

255. The function of ASIC's OGC is to provide legal advice to other ASIC officers. Between 2001 and 2003, which is the relevant time in this case, members of the OGC included Mr Brendan Byrne, who was General Counsel and who held a practising certificate, Stephen Yen (Special Counsel Policy) and Megan Chalmers (Senior Lawyer). I have looked also to the ASIC's Annual Reports in this period.

I realise that they were not tendered or admitted in evidence but I have done so in order to establish the relationship of the OGC with the other sections and divisions to which Ms Birch referred in her evidence and to which I refer a little later in this section of my reasons.

256. The organisational chart shown in the Annual Report for each of the financial years 2000/2001, 2001/2002 and 2002/2003 reveals that the OGC is an office reporting directly to the Commission comprising the Chairman, the Deputy Chairman and a Commissioner. In that regard, it is in the same position as the Regional Commissioners, the Chief Accountant, the Commission Secretariat & Strategic Planning & Analysis, Office of Public Affairs and each of the six Directorates. Neither OGC nor the other offices or officers is separately established by the ASIC Act.[275] The six Directorates are Enforcement, Financial Services Regulation, Market Regulation and Policy, Consumer Protection, International Regional Coordination, Public Commercial Services and Infrastructure and Strategic Planning. The footnotes to the passage describing the Directorates explains that their work receives substantial support from other Directorates which is, presumably, a reference to the other groups set out in the organisational chart. The staff supporting the Commission, OGC and the Chief Accountant are excluded from the staffing numbers show for each of the six Directorates.

257. On the basis of Ms Birch's evidence, I find that the duties of certain officers located in sections and divisions of ASIC other than the OGC also required them either to give legal advice to other officers of their section or division or to seek legal advice from OGC. Among those officers in the period from 2001 to 2003 were the following persons, each of whom she believed was a lawyer:[276]

Senior Lawyers: Philippa Flook, Joanna Bird, Sue Hansen and Diane Weinstein

Senior Lawyers: Louise Macaulay, Nicole Pyner, George Boland, Mark Steward, Ian Coltman, Rachel Waldren, Noel Saville

258. Ms Birch described how ASIC officers seek advice from officers such as these:

"ASIC officers seek legal advice from these ASIC lawyers both formally, in the form of memoranda, and informally, in the form of e-mail advice. All advice, both formal and informal, is kept confidential. Such material is only provided to other officers who have an operational role in respect to the matter under consideration. It is not provided outside of ASIC."[277]

259. Unless I indicate otherwise, the findings in this section of my reasons is based on the evidence of Mr Day, who was the Director of the Investor and Consumer Protection Enforcement Directorate. Although I have referred to some of ASIC's officers in this passage, a list of staff taken from Exhibit JDP-2 to Mr Price's affidavit, Exhibit 3, appears at Annexure H to these reasons.

260. In late 2001, ASIC understood that there was confusion in the community regarding compliance with the requirements of Part 2M.3 of the Corporations Act regarding annual financial reports and of Part 2G.2 regarding meetings of members of companies when a company was subject to administration under Part 5.3A. Part 5.3A is intended to provide for the business, property and affairs of an insolvent company to be administered in a way that maximises the chances of the company to continue in business or, if that is not possible, results in a better return for the company's creditors and members than would result from immediate winding up. ASIC had issued Policy Statement 43 - Accounts and audit relief (PS 43) and Policy Statement 44 - Annual general meeting - extension of time (PS 44). Both applied to a company where a receiver had been appointed but neither applied to a company under administration under Part 5.3A. There was no other relevant policy. PS 43 and PS 44 are now known as RG 43 and RG 44 respectively as they are now regarded as regulatory guides rather than as policy statements.

261. In approximately October 2001, ASIC's Corporate Finance and Regulatory Policy areas began a joint review of PS 43 to take account of Part 5.3A of the Corporations Act. At the time, Corporate Finance was part of ASIC's Policy and Markets Regulation Directorate. Its responsibilities included the regulation of reporting and disclosure issues. Regulatory Policy was responsible for developing new policy, giving policy and law reform advice, managing large policy projects and providing information, analysis and risk assessment data to ASIC's policy decision-makers.

262. ASIC regarded the review as raising a number of complex legal issues relating to the interpretation of the Corporations Act. They had to be resolved in order to address the policy issues. In view of the complexity, senior ASIC officers were assigned to the task. There were two action officers who commenced the review. One was Mr Rob Mackay, who was the Acting Manager of the Financial Reporting Division of Corporate Finance. Corporate Finance was part of ASIC's Policy and Markets Regulation Directorate. The other was Ms Philippa Flook, who was a senior lawyer in Regulatory Policy. Ms Flook reported to Mr Price at the time as he was then the Assistant Director of Regulatory Policy.

263. ASIC initially turned to Mr Stephen Yen, who holds the position of Special Counsel Policy in ASIC's Office of General Counsel for advice regarding the obligations of a company under voluntary administration and those of its directors to prepare financial reports and hold AGMs. Subsequently, ASIC also sought advice from two Senior Counsel at the independent Bar.

264. Mr Mackay and Ms Flook prepared a draft Issues Paper setting out four possible ways in which the interaction between the various obligations could be clarified. Those ways were the revision of PS 43 and PS 44, ASIC's making a Class Order, ASIC's giving relief in specific instances and law reform.

265. Mr Mackay and Ms Flook prepared an RPG submission entitled "Review of Policy Statement 43" but it was not submitted to the RPG. Instead, a paper was prepared for the consideration of ASIC's Commissioners at a meeting on

9 July 2002. After their consideration, Ms Joanna Bird, a senior lawyer in Regulatory Policy, assumed responsibility for preparing a Discussion Paper with the thought that it would be released for public comment.

266. On 14 August 2002, RPG considered the Discussion Paper prepared by Ms Bird and dealing with financial reporting and AGM obligations relating to companies under administration under Part 5.3A. It also considered a further submission by Mr Mackay and Ms Flook dealing with proposed interim relief from financial reporting obligations of companies under external administration.

267. On 5 September 2002, ASIC released a Discussion Paper entitled "Financial reporting and AGM obligations for companies in external administration under Part 5.3A" (Discussion Paper). In ASIC's view, the appointment of an administrator under Part 5.3A does not remove a company's obligation to prepare and lodge its financial reports or to hold AGMs. It wanted to remind companies and their administrators of this and also to remind them that it could give relief in certain circumstances. ASIC set out the nature and scope of its powers to grant relief from compliance with these matters. It went on to explore other options that it could adopt in deciding whether to grant relief and called for public comment on those options and the questions and issues it raised in the Discussion Paper. ASIC advised the public that it would use the comments it received in reviewing and amending PS 43 and

PS 44 to cover relief of this sort. It also advised that it intended to review those Policy Statements more generally. Comments had to be submitted by 31 October 2002. ASIC advised those thinking of doing so that:

"All submissions will be treated as public documents unless you specifically request that we treat the whole or part of your submission as confidential."[278]

268. In a Media Release issued on the same day, ASIC announced that it had issued a Class Order giving interim relief during the consultation period. That relief gave companies under external administration a moratorium from any forthcoming requirement to prepare and lodge a financial report. That Class Order did not extend to the requirement to hold an AGM. Each would need to apply to ASIC if it wished to extend the time within which it held its AGM.

269. The Class Order, to which ASIC referred, was Class Order CO 02/968 - Interim relief from financial reporting obligations for companies in external administration (CO 02/968). It identified the companies to which it applied by reference to the circumstances in which external administration had commenced or been undertaken. It specified the provisions in respect of which relief was given and the period during which relief was given.[279]

270. ASIC received a number of submissions in response to its call for them in the Media Release and Discussion Paper. They were considered by Ms Sue Hansen, a senior lawyer, and Mr Michael Chong, a lawyer, in Regulatory Policy.

271. On 7 May 2003, the RPG considered a submission entitled "Externally administered companies: Financial reporting and AGMs". RPG was given a briefing note on 28 May 2003 seeking approval to release an interim policy statement on the subject of the submission. This was followed by ASIC's releasing an Interim Policy Statement on 5 June 2003. It was entitled "Interim Policy Statement 174 - Externally administered companies: Financial reporting and AGMs" (IPS 174). It is now known as RG 174 and continues to represent ASIC's policy regarding the relief that is available under the Corporations Act for externally administered companies in relation to financial reporting obligations under Part 2M.3 and the obligation to hold an AGM under Division 8 of Part 2G.2.[280]

BACKGROUND TO THE REQUEST IN SO FAR AS IT RELATES TO ALLSTATE

272. On the basis of the written evidence of Mr Warren Alan Day, who is Director, Investor and Consumer Protection, Enforcement Directorate of ASIC,

I make the findings in this section of my reasons.[281]

273. Allstate Explorations NL (Allstate) is a listed no-liability mining company which, at the relevant times, wholly owned two subsidiaries: Allstate Prospecting Pty Ltd (APPL) and ACN 070 164 653 Pty Ltd (ACNPL). It was the manager of the Beaconsfield Mine Joint Venture (BMVJ) and, together, APPL and ACNPL held 51.51% of BMVJ. BMJV is an underground gold mining operation at Beaconsfield in Tasmania. Allstate incurred the majority of the debts incurred by all three companies while the assets were held by APPL and ACNPL. Loans made between companies linked all three companies. On 8 June 2001, Michael Joseph Ryan and Anthony Leslie Woodings of the firm Taylor Woodings were appointed as joint and several administrators of Allstate.

274. The administrators called a meeting of creditors on 18 June 2001. Among other matters, they advised the creditors that Macquarie Bank Ltd (Macquarie) was a secured creditor of Allstate with a claim against the assets of approximately $20,000,000 in respect of its principal debt and $12,000,000 in respect of outstanding hedging instruments. In addition, Allstate had unsecured creditors' claims totalling approximately $5,500,000.

275. The Bank of Western Australia Limited (BankWest) was a secured creditor of Beaconsfield Gold NL (BCD). On 25 June 2001, it appointed Mr Gary Trevor of Ferrier Hodgson as receiver and manager to BCD.

276. On 4 October 2001, the administrators of Allstate held a second creditors' meeting. The creditors voted to accept a Deed of Company Arrangement (DOCA) and Mr Ryan and Mr Woodings were appointed joint and several administrators of Allstate under that deed. It was subsequently executed on

12 November 2001. Mr Ryan advised the creditors at that meeting that an agreement had been reached among Allstate, as manager of BMJV, Macquarie and BankWest to provide regular funding to meet BMJV's running costs in the future. The creditors were also advised of the financial arrangements among Allstate, APPL and ACNPL. If the assets held by APPL and ACNPL were sold, any funds remaining after payment of secured creditors would be paid by means of loan accounts to Allstate. Those funds would then be available to pay other creditors. Macquarie had a registered charge over the assets of all three companies. The goldmine had been advertised for sale on a worldwide basis.

277. On 14 November 2001, Allstate announced to the Australian Stock Exchange (ASX) that, since 8 June 2001, the BMJV had continued to operate as a going concern and that, on 13 June 2001, the Deed Administrator had decided to withdraw the goldmine from the market.

278. On 17 November 2001, a further creditors' meeting voted in favour of varying the DOCA and a Deed of Variation was executed on 8 January 2002 by a director of Allstate together with Mr Ryan and Mr Woodings. On 19 March 2002, a further variation was approved by a further meeting of creditors. That led to a Deed of Variation executed on 28 March 2002. The effect of this variation was announced to the ASX, Allstate's creditors and shareholders and the public through a Circular to creditors and shareholders and a Press Release. Both were dated 29 October 2002. In relation to the variations, the Circular advised:

"On or about 8 January 2002, a deed varying Allstate's DOCA was executed reflecting variations that the creditors of Allstate had resolved to approve at a meeting on 17 December 2001. Materially, the amendments provided for Allstate and Beaconsfield gold mine to trade-on (with the deed administrator's day to day involvement being reduced); for the deed administrators to have a discretion to sell Allstate's assets; for the distribution to creditors under the DOCA to survive in a winding up; for the discharge and release of Allstate's creditors' claims in certain circumstances; confirmation that the DOCA did not affect any charges or liens held by the creditors of ALX nor Macquarie's ability to appoint a receiver and manager; and for the deed of administrators to have a discretion to call a meeting of the creditors of Allstate to consider a resolution that the DOCA be terminated and that Allstate be liquidated.

On or about 28 March 2002, a deed further varying Allstate's DOCA was executed reflecting variations that the creditors of Allstate had resolved to approve at a meeting on 19 March 2002. Materially, the amendments provided for the sale by Allstate to Macquarie Bank Limited of certain debts that were owing to Allstate by APPL and ACNPL. The consideration for the sale of these debts was to form part of the 'ALX Property' and was to be distributed in accordance with the terms of the DOCA, but it was not to be used to pay any dividend to Macquarie nor to pay the deed administrators' remuneration, costs, fees or expenses.

At present, there has been no return to the secured creditor of Allstate from the continued trade-on of Allstate. Also, at this stage, it appears that there is little, if any, equity in Allstate that will be available for its shareholders.[282]

On 26 February 2007, Allstate ceased to be in external administration.

279. In 2002, a number of members of the public complained to ASIC regarding the administration of Allstate. As a result of the complaints, ASIC commenced an investigation into the affairs of Allstate and, in particular, into the variation of the DOCA approved by creditors on 19 March 2002. This was known as the Assignment Investigation. As part of its investigation, ASIC issued notices under Division 3 of Part 3 of the ASIC Act to a number of persons requiring them to produce documents to it. Notices were also issued requiring a number of persons to attend for examination by the officers. Documents were also produced to ASIC on a voluntary basis.

280. Division 3 of Part 3 of the ASIC Act gives ASIC powers to inspect books but they may only be exercised for the purposes set out in s 28(1). Those purposes include those for the performance or exercise of any of its functions or powers under the corporations legislation, for ensuring compliance with that legislation and in relation to an alleged or suspected contravention of it. The power is exercised by ASIC's giving a written notice in accordance with one or other of ss 30 to 33. Once the documents have been produced to a person, that person may take possession of them, inspect them and make copies of them. That person may use them for the purposes of a proceeding or permit their use for that purpose.[283]

A "proceeding" refers to a proceeding under the law of the Commonwealth or of a State or Territory or in relation to a contravention of Division 2 of Part 2.[284] While the books are in that person's possession:

(a) must permit another person to inspect at all reasonable times (if any) of the books as the other person would be entitled to inspect if they were not in the first-mentioned person's possession; and

(b) may permit another person to inspect any of the books."

281. Division 2 of Part 7 of the ASIC Act is concerned with confidentiality and, of particular interest in this case, is s 127(1)(a) which provides:

"ASIC must take all reasonable measures to protect from unauthorised use or disclosure information:

(a) given to it in confidence in or in connection with the performance of its functions or the exercise of its powers under the corporations legislation (other than the excluded provisions);

The "excluded provisions" refer to s 12A[285] and Division 2 of Part 2 and so nothing to do with the subject matter of ASIC's investigations into Allstate.

282. The protection given by s 127(1)(a) is from "unauthorised use or disclosure" of the information (emphasis added). Sections 127(1A) to (5A) set out specific instances in which disclosure is authorised. I will refer to only three in order to give a flavour of the uses that are authorised:

"(1A) Disclosing summaries of information or statistics derived from information is authorised use and disclosure of the information provided that information relating to any particular person cannot be found out from those summaries or statistics."

"(2) For the purposes of subsection (1), the disclosure of information as required or permitted by a law of the Commonwealth or a prescribed law of a State or internal Territory is taken to be authorised used and disclosure of the information."

"(4) Where the Chairperson is satisfied that particular information:

(b) will enable or assist the government, or an agency, of a State or Territory to perform a function or exercise a power;

"Nothing in any of subsections (1A), (2), (2A), (2B), (2C), (3), (4), (4B) and (5) limits:

(b) what may otherwise constitute, for the purposes of subsection (1), authorised use or disclosure of information."

284. The Assignment Investigation was concluded in early 2004. The originals of documents were returned to those who produced them but electronic copies were retained of some of them.

285. In early 2003, Mr Matthews lodged complaints with ASIC regarding the Allstate gold hedge book and transactions made in that book before the appointment of external administrators in June 2001. This was known as the Hedge Book Investigation and notices were issued to produce documents and attend for examination as before. In early 2004, ASIC decided to take no further action with respect to the investigation.

286. ASIC was established by s 7 of the Australian Securities and Investments Commission Act 1989. When that enactment was repealed by the ASIC Act, ASIC was continued in existence under s 261 of that later enactment. ASIC consists of no fewer than three nor more than eight members, known as Commissioners.[286]

287. Division 1 of Part 2 of the ASIC Act sets out ASIC's functions and powers. They are many and various but, for the purposes of this case, I will note only a few. Beginning with the broader statement of its functions and powers, it is given functions and powers under Division 2 of Part 2 of the ASIC Act as well as under the corporations legislation[287] and other specific enactments regulating various aspects of the financial services, superannuation and retirement benefit industries, consumer credit protection and first home saver accounts.[288] In addition, s 12A provides that:

"(2) ASIC has the function of monitoring and promoting market integrity and consumer protection in relation to the Australian financial system.

(3) ASIC has the function of monitoring and promoting market integrity and consumer protection in relation to the payments system by:

(a) promoting the adoption of approved industry standards and codes of practice; and

(b) promoting the protection of consumer interests; and

(c) promoting community awareness of payments system issues; and

(d) promoting sound customer-banker relationships, including through:

(i) monitoring the operation of industry standards and codes of practice; and

(ii) monitoring compliance with such standards and codes.

(4) Subsections (2) and (3) confer functions and powers to the extent to which they are not in excess of the legislative power of the Commonwealth.

(a) advise the Minister about any changes to a law listed in subsection (1) that ASIC thinks are needed to help overcome any problems that ASIC has encountered in the course of performing its functions or exercising any of its powers under that law; and

(b) advise the Minister and make such recommendations as it thinks fit about any matter relating to its functions in subsections (2) and (3)."[289]

288. Either on its own initiative or when requested by the Minister, ASIC may advise the Minister and make recommendations to the Minister about matters referred to in s 148[290] i.e. about matters on which the Corporations and Markets Advisory Committee (CMAC) may make recommendations to the Minister either on its own initiative or when requested by the Minister to do so. The matters are:

"(a) a proposal to make corporations legislation, or to make amendments of the corporations legislation (other than the excluded provisions); or

(b) the operation or administration of the corporations legislation (other than the excluded provisions); or