Naismith v McGovern

High Court of Australia|1953-07-01|Before: Taylor JJ, Matthews J

High Court of Australia Williams, Webb, Kitto and Taylor JJ. Naismith v McGovern [1953] HCA 59

ORDER Appeal allowed with costs. Order below set aside. In lieu thereof order the plaintiff to comply with the notice of discovery served on him by the defendant within twenty-eight days after the service of an office copy of this order upon the plaintiff. The plaintiff to pay the costs of the proceedings before Matthews J.

The Court delivered the following written judgment: -

Part VII. of the Assessment Act consists of ss. 222 to 251 inclusive. Section 222 provides that: "In this Part, "taxation prosecution" means a proceeding by the Crown for the recovery of a pecuniary penalty under this Act". Section 237 provides that: "Every taxation prosecution in the High Court of Australia or the Supreme Court of any State or Territory of the Commonwealth may be commenced prosecuted and proceeded with in accordance with any rules of practice established by the Court for Crown suits in revenue matters or in accordance with the usual practice and procedure of the Court in civil cases or in accordance with the directions of the Court or a Judge". There are in this Court no rules of practice established by the Court for Crown suits in revenue matters and the present proceeding is being prosecuted in accordance with the usual practice and procedure of the Court in civil cases. The defendant served a notice on the plaintiff in accordance with r. 9 of O. 32 of the High Court Rules requiring him to make discovery on oath of the documents which are or have been in his possession or power relating to the matter in question in the proceedings. The plaintiff refused to comply with the notice on the ground that discovery is not appropriate in proceedings under Pt. VII. of the Assessment Act. The Deputy Crown Solicitor said that such proceedings are for the recovery of penalties and, though they follow a civil form, partake of the nature of criminal proceedings, and in such proceedings discovery is not appropriate. He added that the proceedings were penal in their nature, though civil in form, and it has never been the practice to allow discovery or interrogatories in penal actions against the defendant, and accordingly it is inappropriate that discovery should, in such a case, be ordered against the plaintiff. The defendant then applied by summons for an order that the plaintiff should within seven days after the making of the order comply with the notice of discovery. The summons was heard by Matthews J., a judge of the Supreme Court of Queensland, exercising federal jurisdiction under s. 39 (2) of the Judiciary Act 1903-1950. His Honour held that proceedings under ss. 227 and 230 of the Assessment Act are criminal proceedings and that therefore discovery could not be ordered. Accordingly he ordered that the summons should be dismissed with costs. The appeal is an appeal by the defendant from that order under s. 39 (2) (b) of the Judiciary Act.

His Honour apparently relied on the rule which has prevailed since Montague (Lord) v. Dudman [1] that a bill of discovery lies to "aid the proceeding in some suit relating to a civil right in a court of common law, as an action; but not to aid the prosecution of an indictment or information, or to aid the defence to it" [2] . But his Honour did not refer to any authority. In Robertson, Civil Proceedings by and against the Crown, at p. 174 it is stated that informations for penalties are to be regarded rather as civil than as criminal proceedings. In Attorney-General v. Freer [3] , Graham B. said: "I think that the Attorney-General is perfectly right when he says that these proceedings for penalties here, are although partly of a criminal nature, for many purposes to be considered as in the nature of civil actions" [4] . In R. v. McStay [5] Williams J. said that proceedings under Pt. VII. are not strictly criminal proceedings, a view he adhered to in McGovern v. Hillman Tobacco Pty. Ltd. [6] where, after citing s. 237 of the Act, he said: "Accordingly, proceedings must, for many purposes, be considered as being in the nature of a civil action" [7] . In Jackson v. Butterworth [8] Fullagar J., who was then a judge of the Supreme Court of Victoria, held that proceedings under Pt. VII. are civil rather than criminal in their nature, an opinion he adhered to in Jackson v. Gromann [9] . The question was touched upon by the Full Court consisting of Latham C.J., Dixon J. (as he then was) and McTiernan J. in Mallan v. Lee [10] but nothing decisive was said. Latham C.J. expressed the view that the proceedings might assume a civil form or a criminal form. He said: "If proceedings are instituted in a court of summary jurisdiction (as in the present case) there is nothing to distinguish the proceedings from any other proceedings for an offence. If proceedings were instituted in the Supreme Court or the High Court they might assume a civil form or, in accordance with the directions of the Judge, a form more nearly approaching to that of criminal proceedings" [1] . Dixon J. did not discuss the question. McTiernan J. said [2] that it had been argued that the understating of income in breach of s. 230 could not be aided and abetted in the proper sense of the words because the understatement did not amount to the commission of a crime. He then said: "The argument is based upon other sections of the Act providing procedure which is more appropriate to civil than to criminal matters, for the prosecution of "offences" against the Act. The authorities which have been cited in connection with this argument do not enable a clear conclusion to be reached that such procedural provisions alter the character which the words, "guilty of an offence", naturally ascribe to the conduct of understating income in breach of s. 230. I think that the better test is to accept the legislative definition of the conduct: I should hold accordingly that it is an offence and is criminal" [3] . We are here primarily concerned with the sections in Pt. VII. relating to the procedure laid down for the recovery of pecuniary penalties for offences and not with the nature of the offences themselves and nothing that was held in Mallan v. Lee [4] throws any doubt upon the remarks of Williams J. and Fullagar J. in the cases cited. The most that can be said is that the proceedings being for the recovery of penalties are of a penal nature. It is clear that the actual procedure by which an order for the recovery of a penalty is obtained in this Court is, in the absence of a special order, the civil procedure of this Court. This is expressly provided for by s. 237 of the Assessment Act. Discovery and the administration of interrogatories are part of the ordinary civil procedure of the Court. The practice is now regulated by O. 32 of the Rules of Court. Originally orders for discovery were not obtainable at common law, except to a limited extent, and a party to a common law action who desired general discovery had to proceed by bill in equity. But the Court of Equity would not make an order for discovery or for the administration of interrogatories in favour of the prosecutor whether the prosecutor was the Crown or a common informer or any other person where the proceeding was of such a nature that it might result in a penalty or forfeiture: " nemo tenetur seipsum prodere ". When discovery and interrogatories were provided for under the rules made under the Judicature Act the same principle was applied. It was held that the orders were not intended to confer a right to discovery, Hunnings v. Williamson [1] ; or to administer interrogatories, Martin v. Treacher [2] , where prior to the Judicature Act such orders were not obtainable. See also Mexborough (Earl) v. Whitwood Urban District Council [3] ; Colne Valley Water Co. v. Watford & St. Albans Gas Co. [4] . The subject is discussed in the judgment of Isaacs J., as he then was, in R. v. Associated Northern Collieries [5] . The proceedings there in question were brought under s. 13 (1) of the Australian Industries Preservation Act 1906-1910 which provided that proceedings for the recovery of pecuniary penalties for offences, other than certain offences, should be instituted in the High Court by way of civil action and should be tried before a justice of that Court without a jury. His Honour held that in a civil action for penalties, in the absence of statutory provision to the contrary, the plaintiff is not entitled to an order for discovery of documents against the defendant and that this rule applies equally both to actions by the Crown and actions by a common informer.

(1751) 2 Ves. Sen. 396 [28 E.R. 253]. 2. (1751) 2 Ves. Sen., at p. 398 [28 E.R., at p. 254]. 3. (1822) 11 Price 183 [147 E.R. 441]. 4. (1822) 11 Price, at p. 197 [147 E.R., at p. 446]. 5. (1945) 7 A.T.D. 527, at p. 553. 6. (1949) 4 A.I.T.R. 272. 7. (1949) 4 A.I.T.R., at p. 275. 8. (1946) V.L.R. 330. 9. (1948) V.L.R. 408, at p. 411. 10. (1949) 80 C.L.R. 198. 11. (1949) 80 C.L.R., at p. 209. 12. (1949) 80 C.L.R., at p. 217. 13. (1949) 80 C.L.R., at pp. 217-218. 14. (1949) 80 C.L.R. 198. 15. (1883) 10 Q.B.D. 459. 16. (1886) 16 Q.B.D. 507. 17. (1897) 2 Q.B. 111. 18. (1948) 1 K.B. 500. 19. (1910) 11 C.L.R. 738.

In the present proceedings, therefore, assuming these principles are applicable, the plaintiff could not obtain an order for discovery or for interrogatories against the defendant. The plaintiff has not sought such an order. He has in any event wide powers of obtaining information under ss. 263 and 264 of the Assessment Act. The plaintiff represents the Crown in right of the Commonwealth but in cases that fall within s. 64 of the Judiciary Act 1903-1950 the Crown in right of the Commonwealth is just as liable to give discovery or to answer interrogatories by an appropriate officer as a private litigant. The Commonwealth v. Miller [6] ; R. v. Associated Northern Collieries [5] ; Heimann v. The Commonwealth [7] . Counsel for the plaintiff did not argue to the contrary. He contended, however, that Pt. VII. is in itself a complete code for regulating proceedings for the recovery of pecuniary penalties under the Assessment Act and that s. 64 of the Judiciary Act has no application to such proceedings. Consequently the Crown in right of the Commonwealth in proceedings under Pt. VII. can rely on its prerogative immunity from discovery or interrogatories. He also contended that it is implicit in O. 32 of the rules of this Court that the right to obtain discovery or administer interrogatories should be mutual so that, since the plaintiff cannot obtain an order for either discovery or interrogatories against the defendant in proceedings under Pt. VII. of the Assessment Act because of their penal nature, the defendant is equally debarred. We are unable to accept either of these contentions. Section 64 of the Judiciary Act provides that: "In any suit to which the Commonwealth or a State is a party, the rights of parties shall as nearly as possible be the same, and judgment may be given and costs awarded on either side, as in a suit between subject and subject". Section 2 of the Judiciary Act provides that: " "suit" includes any action or original proceeding between parties". Section 222 of the Assessment Act provides that taxation prosecutions are proceedings by the Crown for the recovery of pecuniary penalties under the Assessment Act. Such prosecutions are original proceedings in this Court. They proceed in accordance with the usual practice and procedure of the Court in civil cases. We can see no reason why s. 64 of the Judiciary Act should not apply to such proceedings. It is no answer to an application by one party to proceedings for an order for discovery or interrogatories that that party is for some reason immune from such an order. The Crown could always obtain an order when it was immune. The Court of Equity made an order for discovery or interrogatories in favour of the plaintiff, not a mutual order for the benefit of both parties: Van Heythuysen, Equity Draftsman, 2nd ed. (1828), pp. 483-514; Skinner v. Commissioner for Railways [1] . The point raised in the second contention was rejected by Lord Esher, M.R. in Martin v. Treacher [2] . He said, "It was suggested by the plaintiff's counsel that the defendant in such an action could interrogate the plaintiff, and that there ought not to be an inequality between them in this respect. I see no objection to the conclusion at which we have arrived on that ground, or that justice to the plaintiff requires it to be otherwise" [3] . In our opinion, no valid objection has been raised to the making of an order for discovery in the present case. We only wish to add that the third limb of s. 237 of the Assessment Act gives a very wide discretion and under that limb the Court could make any procedural order either in favour of the plaintiff or the defendant to meet the special circumstances of any particular case.

(1910) 10 C.L.R. 742. 2. (1910) 11 C.L.R. 738. 3. (1935) 54 C.L.R. 126. 4. (1937) 37 S.R. (N.S.W.) 261, at pp. 263-264; 54 W.N. 108. 5. (1886) 16 Q.B.D. 507. 6. (1886) 16 Q.B.D., at p. 512.

For these reasons we must allow the appeal with costs, set aside the order below, and in lieu thereof order the plaintiff to comply with the notice of discovery served on him by the defendant within twenty-eight days after the service of an office copy of this order upon the plaintiff. The plaintiff must pay the costs of the proceedings before Matthews J.

At a glance

Court

Decision date

Before

Source

Judgment (10 paragraphs)

Parties