Pathways Employment Services v West [2004] NSWSC 903 | Case summary

The scope of the privilege was stated by Gibbs CJ in Sorby v The Commonwealth of Australia (1983) 152 CLR 281, at 294-5, as follows: "If a witness is compelled to answer questions which may show that he has committed a crime with which he may be charged, his answers may place him in real and appreciable danger of conviction, notwithstanding that the answers themselves may not be given in evidence. The traditional objection that exists for allowing the executive to compel a man to convict himself out of his own mouth applies even when words of the witness may not be used as an admission. It is a cardinal principle of our system of justice that the Crown must prove the guilt of an accused person, and the protection which that principle affords to the liberty of the individual will be weakened if power exists to compel a suspected person to confess his guilt." 11 In Reid v Howard (1995) 184 CLR 1 at 14, Toohey, Gaudron, McHugh and Gummow JJ stated categorically: "There is simply no scope for an exception to the privilege, other than by statute." The Privilege and its Statutory Abrogation Concerning Civil Court Proceedings 12 A conflict has been long apparent between the policy underlying the privilege against self-incrimination, and the policy that underlies the procedures, originally equitable, of discovery and interrogatories. The answer which the courts arrived at, from at least The Attorney-General v Brown (1818) 1 Swans 265; 36 ER 384, is to not permit discovery and interrogatories concerning which a privilege against self-incrimination is claimed. See also Bray on Discovery (Reeves and Turner, London, 1885), p 313 ff; Environment Protection Authority v Caltex Refining Co Pty Limited (1993) 178 CLR 477 at 528. 13 There is a long history of legislative intervention to negative, in particular circumstances, this curial rule. One circumstance which has long occasioned such legislative intervention has been the view that a thief ought not be able to use the privilege against self-incrimination as a way of avoiding discovery and interrogatories in proceedings brought by the owner of the property, which the owner has lost through someone's dishonesty, to recover that property or its value. Some of that history was recounted by Wootten J in McMahon v Gould (1982) 7 ACLR 202 at 209-10. "There is a long history, going back at least to 1827 in England (7, 8 Geo IV c 29 ss 47-59) of legislative recognition that the introduction of the criminal law into this area calls for a special approach to the preservation of civil remedies. In this State the current provisions are in ss 177 and 178 of the Crimes Act 1900 , which relate to offences created by ss 165 to 176 of that Act. These offences include the misappropriation by agents of money or goods entrusted to them, fraudulent sales under powers of attorney, the pledging of a principal's goods by his agent, fraudulent dispositions of property by trustees, and a series of offences by directors and officers of companies - fraudulently omitting entries in or falsifying books, publishing fraudulent statements, and cheating and defrauding the company. Section 178(1) provides: "Nothing in sections 165 to 176 both inclusive shall relieve any person from making a full discovery, by answer to interrogatories, or from answering any question in a civil proceeding." Section 177 protects a person from conviction under ss 165 to 176 if he first discloses his act or omission under compulsory process in a proceeding instituted by a party aggrieved or in bankruptcy or winding up proceedings. Subsection (1) of s 178, which was in the Criminal Law Amendment Act of 1883 as s 139, has a history going back at least to the English Larceny Act 1861 , s 86. When the Criminal Law Revision Committee came in 1966 to review the law in its Eighth Report Theft and Related Offences Cmd 2977, it proposed in its draft Bill a clause 27(1) which with minor modifications became s 31 of the Theft Act 1968 . Paragraph 200 of the Report is as follows: Clause 27(1) provides that a party or witness in certain civil proceedings shall not be allowed, in reliance on the usual privilege of non-incrimination, to refuse to answer a question or comply with an order on the ground that to do so might show that he has committed an offence under the Bill; but in compensation it makes the answer or disclosure inadmissible in evidence against him in the event of his being prosecuted for the offence. The civil proceedings referred to are proceedings for the recovery or administration of any property, for the execution of a trust or for an account of property or dealings in property. The policy of this provision and of the corresponding provisions in the present law concerning disclosure of offences under the 1861 and 1916 Acts is that on balance the public interest requires that persons in possession of property on behalf of others should be compelled to give information about their dealings with the property in order to protect the interests of those entitled to it, notwithstanding that this involves departing from the general rule that a witness need not incriminate himself. But it is thought that in return the making of the disclosure should give a measure of protection in respect of criminal proceedings. Disclosure is specially important in the case of small properties, which might disappear if a defalcator could obstruct proceedings for the recovery or administration of the property by standing on his privilege of refusing to disclose his dealings with the property on the ground that disclosure might incriminate him. In the context of this legislative history and of s 177, I think it is clear that s 178(1) does, as Needham J hypothesised in Re Saltergate Insurance Co , supra, [(1980) 4 ACLR 733] at 736 mean that no person who has been charged with an offence under ss 165-176 may decline to answer any question in a civil proceeding based on the facts, the subject of the charge." 14 New South Wales has not adopted legislation which creates as wide an exemption from the privilege against self-incrimination as does section 31 of the Theft Act 1968 (UK). In the present case, the charge against the first defendant is one of obtaining money by deception. That charge is one arising under section 178BA Crimes Act 1900, and so the exception from the privilege against self-incrimination created by section 178(1) Crimes Act 1900 does not apply to the first defendant (cf Reid v Howard (1993) 31 NSWLR 298 at 307). 15 After the decision of the House of Lords in Rank Film Distributors Ltd v Video Information Centre [1982] AC 380, it was apparent that the privilege against self-incrimination could be invoked by a person who was the subject of an Anton Piller order, and/or a Mareva order requiring disclosure of assets, and that the privilege provided a ground upon which that disclosure need not be made. Rank Film Distributors was a case involving copyright piracy, an activity which involves dishonest appropriation of the property of the copyright owner, but concerning which (as Lord Wilberforce noted at 443) section 31 of the Theft Act 1968 (UK) does not apply to remove the privilege against self-incrimination. In England, the Parliament's response was to enact section 72 of the Supreme Court Act 1981 (UK) which provides: "(1) In any proceedings to which this subsection applies a person shall not be excused, by reason that to do so would tend to expose that person, or his or her spouse, to proceedings for a related offence for the recovery of a related penalty - (a) from answering any question put to that person in the first mentioned proceedings; or (b) from complying with any order made in those proceedings. (2) Subsection (1) applies to the following civil proceedings in the High Court, namely - (a) proceedings for infringement of rights pertaining to any intellectual property or for passing off; (b) proceedings brought to obtain disclosure of information relating to an infringement of such rights or to any passing off; and (c) proceedings brought to prevent any apprehended infringement of such rights or any apprehended passing off. (3) Subject to subsection (4), no statement or admission made by a person - (a) in answering a question put to him in any proceedings to which subsection (1) applies; or (b) in complying with any order made in any such proceedings, shall, in proceedings for any related offence or for the recovery of any related penalty, be admissible in evidence against that person or (unless they married after the making of this statement or admission) against the spouse of that person. (4) Nothing in subsection (3) shall render any statement or admission made by a person as there mentioned inadmissible in evidence against that person in proceedings for perjury or contempt of court." 16 Section 72 Supreme Court Act 1981 (UK) was cast in the terms it was because section 31(1) Theft Act 1968 (UK) already provided a broad exception from the privilege against self-incrimination "in proceedings for the recovery or administration of any property, for the execution of any trust or for an account of any property or dealings with property". The extensions to the exemption from the privilege against self-incrimination made by section 72 Supreme Court Act 1981 (UK) were made because intellectual property piracy and passing off frequently involved criminal offences, but not criminal offences which could be prosecuted under the Theft Act 1968 (UK). 17 In New South Wales, Waddell CJ in Eq in BPA Industries Ltd v Black (1987) 11 NSWLR 609 (a case concerned with the heartland of Anton Piller orders, namely piracy of intellectual property and passing off) upheld the right of a person against whom Anton Piller and Mareva orders had been made to claim a privilege against self-incrimination. He remarked, at 613: "Anton Piller orders have proved tremendously useful in practice. Every year a substantial number of cases come before this Court in which plaintiffs present a convincing prima facie case of infringement of intellectual property or misuse of confidential information or of passing off in which the making of such an order is necessary to establish their rights. Unfortunately fraud and deception are not uncommon in these fields. In many such cases the conduct of the defendant or defendants is likely to be criminal in nature as well as a civil wrong and exercise of the privilege against self-incrimination would be likely to defeat an Anton Piller order. It is, therefore, in my opinion, absolutely essential, in order to preserve a necessary remedy in this kind of case, that the provisions in the Supreme Court Act 1981 (UK), s 72, be adopted in New South Wales as soon as possible."

Their Lordships regarded that order as providing an adequate protection against the privilege against self-incrimination being overridden, because the prosecuting authorities had acquiesced with knowledge in such an order being made. Lord Ackner (with whose reasons Lord Templeman and Lord Goff of Chieveley agreed) said, at 63: "… the courts are entitled to substitute some different protection in place of the privilege against self-incrimination, providing that such protection can properly be considered as adequate protection." 20 In Reid v Howard (1993) 31 NSWLR 298 the New South Wales Court of Appeal followed and extended that decision. Handley JA (with whom Meagher and Sheller JJA agreed) held that the provision of alternate protection was not dependent upon agreement of the prosecuting authorities, because if a civil court made an order for disclosure on terms that the information disclosed not be used in a criminal prosecution, any prosecutor who acted contrary to that order would be guilty of contempt (at 308-309). 21 The unanimous reversal by the High Court of that decision of the Court of Appeal was effected in circumstances where their Honours were well aware of, and cited, the decision of the House of Lords in AT&T Istel Ltd v Tully [1993] AC 45. While their Honours were too polite to say so in so many words, the High Court's decision in Reid v Howard (1995) 184 CLR 1 necessarily involves a rejection of the view of the House of Lords that the courts are entitled to substitute some different protection in place of the privilege against self-incrimination, providing that such protection can properly be considered as adequate protection. 22 Further, it was in this context of not accepting the House of Lords' view that judicial tweaking of the privilege against self-incrimination was possible, that Toohey, Gaudron, McHugh and Gummow JJ said, at 17, that they had come to: " … the conclusion not merely that the privilege is not to be modified or abrogated in favour of some different protection by judicial decision, but that its modification or the substitution of some different protection can effectively be achieved only by legislation. Moreover and of more importance, the inherent power and the jurisdiction conferred by s 23 of the Supreme Court Act are to be exercised only as necessary for the administration of justice. Quite apart from the difficulties which the orders of the Supreme Court present for the administration of justice, to which reference has already been made, it is inimical to the administration of justice for a civil court to compel self-incriminatory disclosures, while fashioning orders to prevent the use of the information thus obtained in a court vested with criminal jurisdiction with respect to the matters disclosed. Nor is justice served by the ad hoc modification or abrogation of a right of general application, particularly not one as fundamental and as important as the privilege against self-incrimination. " Section 128 Evidence Act 1995 and Abrogation of Privilege 23 The statute which abrogates the privilege against self-incrimination and is relevant to the present application is the Evidence Act 1995 (NSW). Section 128 of that Act provides, so far as relevant: "(1) This section applies if a witness objects to giving particular evidence on the ground that the evidence may tend to prove that the witness: (a) has committed an offence against or arising under an Australian law or a law of a foreign country, or (b) is liable to a civil penalty. (2) Subject to subsection (5), if the court finds that there are reasonable grounds for the objection, the court is not to require the witness to give that particular evidence, and is to inform the witness: (a) that he or she need not give the evidence, and (b) that, if he or she gives the evidence, the court will give a certificate under this section, and (c) of the effect of such a certificate. (3) If the witness gives the evidence, the court is to cause the witness to be given a certificate under this section in respect of the evidence. (4) The court is also to cause a witness to be given a certificate under this section if: (a) the objection has been overruled, and (b) after the evidence has been given, the court finds that there were reasonable grounds for the objection. (5) If the court is satisfied that: (a) the evidence concerned may tend to prove that the witness has committed an offence against or arising under, or is liable to a civil penalty under, an Australian law, and (b) the evidence does not tend to prove that the witness has committed an offence against or arising under, or is liable to a civil penalty under, a law of a foreign country, and (c) the interests of justice require that the witness give the evidence, the court may require the witness to give the evidence. (6) If the court so requires, it is to cause the witness to be given a certificate under this section in respect of the evidence. (7) In any proceeding in a NSW court: (a) evidence given by a person in respect of which a certificate under this section has been given, and (b) evidence of any information, document or thing obtained as a direct or indirect consequence of the person having given evidence, cannot be used against the person. However, this does not apply to a criminal proceeding in respect of the falsity of the evidence. 24 That provision is construed with the help of the following definition in Part 2 of the Dictionary to the Evidence Act 1995: "A reference in this Act to a witness includes a reference to a party giving evidence." 25 Section 4(1) Evidence Act 1995 provides: "(1) This Act applies in relation to all proceedings in a NSW court, including proceedings that: (a) relate to bail, or (b) are interlocutory proceedings or proceedings of a similar kind, or (c) are heard in chambers, or (d) subject to subsection (2), relate to sentencing." 26 If the first defendant were to be ordered to attend to give evidence relating to his assets, the Evidence Act 1995 would apply to the hearing in which he gave that evidence. In Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 at 401 Gaudron, McHugh, Gummow and Callanan JJ said: "In Australia, for many years, Mareva orders have been made in aid of the exercise of the specific remedies provided for execution against judgment debtors. Such orders are not interlocutory as they may operate after the recovery of final judgment, yet they are impermanent in the sense that they preserve assets and assist and protect the use of methods of execution and do not substitute for them." 27 Even if such an examination in court does not count as "interlocutory proceedings" within the meaning of section 4(1)(b) Evidence Act 1995, it still falls within the opening words of section 4(1): "This Act applies in relation to all proceedings in a New South Wales court". Just as a liquidator's compulsory examination involves evidence being given in a proceeding (Re Doran Constructions Pty Ltd (in liq) [2002] NSWSC 215; (2002) 194 ALR 101 at [89]-[112]), so is a preliminary examination for the purpose of a Mareva order a proceeding in a court. Application of Section 128 to Mareva and Anton Piller Orders 28 Following the enactment of section 128 Evidence Act 1995, a series of decisions in the Equity Division of this Court developed a practice which was described as follows by Fitzgerald JA in Vasil v National Australia Bank Ltd (1999) 46 NSWLR 207 at 222: "Shortly stated, the Equity Division makes ex parte orders which require an affidavit of assets and that, after the affidavit of assets is sworn but before it is filed, it be brought into Court and notice of the hearing at which that is to occur be given to the Director of Public Prosecutions; if an objection based on the privilege against self-incrimination is taken when the affidavit of assets is brought into court, the parties and the Director of Public Prosecutions are heard on whether a certificate should be granted under s 128 of the Evidence Act 1995 and, presumably, any other questions arising under that section. The basic approach taken is that, if a certificate is given, the affidavit may be used in the civil proceeding and the deponent is protected by s 128(9), and, if the certificate is refused, an order is made for the surrender and destruction of all copies of the affidavit." 29 The decision in Vasil involved an appeal from a Mareva order made in the Common Law Division, which did not follow that Equity Division procedure, but rather simply required the recipient to deliver to the opposite party in the litigation an affidavit setting out certain specified details of his assets. Fitzgerald JA (with whom Stein JA agreed) in Vasil had no difficulty in deciding that an order in that form infringed the privilege against self-incrimination. His Honour also said, obiter, at 222: "However, it is not clear to me that the Equity Division practice does not encounter some of the objections referred to by the majority decision in Reid v Howard (at 16-17): "... What considerations are to be taken into account by a judge of the Equity Division in deciding, pursuant to orders 6 and 7 [of the orders made by this Court], whether or not to grant leave to the [plaintiff's] solicitors to disclose the information contained in the affidavits? If there is to be no disclosure, are proceedings to be conducted behind closed doors even though such a course is allowed only in exceptional cases where that is necessary in the interests of justice? ( Scott v Scott [1913] AC 417 at 439, cited with approval in Russell v Russell ; Farrelly v Farrelly (1976) 134 CLR 495 at 520; see also Raybos Australia Pty Ltd v Jones (1985) 2 NSWLR 47, per Kirby P, for a discussion of the history and principles relating to the open administration of justice in courts). These considerations lead to the conclusion not merely that the privilege is not to be modified or abrogated in favour of some different protection by judicial decision, but that its modification or the substitution of some different protection can effectively be achieved only by legislation. ... Quite apart from the difficulties which the orders of the Supreme Court present for the administration of justice, ... it is inimical to the administration of justice for a civil court to compel self-incriminatory disclosures, while fashioning orders to prevent the use of the information thus obtained in a court vested with criminal jurisdiction with respect to the matters disclosed. Nor is justice served by the ad hoc modification or abrogation of a right of general application, particularly not one as fundamental as the privilege against self-incrimination." I add only that it also seems to me inimical to the administration of justice for orders to be made ex parte when it is unnecessary to do so." 30 The Equity Division's practice on this topic was further developed by the decision of Austin J in Bax Global (Australia) Pty Ltd v Evans (1999) 47 NSWLR 538. His Honour described the practice at [41] - [46] as follows: "If the Court decides to initiate the disclosure process, the procedure which it chooses is likely to depend on whether, on the one hand, an objection to disclosure based on the privilege against self-incrimination has been taken or is a real possibility, or on the other hand the disclosure order is unlikely in the circumstances to raise any question about self-incrimination. In the latter case, it is enough simply to express the order to be subject to any claim of privilege against self-incrimination, as Hodgson J did initially in Reid v Howard . In the former case, it is more appropriate to use the fuller procedure which I shall describe. The Court initiates the disclosure procedure by making an order that a disclosure affidavit be prepared and delivered to the judge's associate in a sealed envelope, together with directions that the affidavit not be filed or served on any other party, and that the further hearing be notified to the Director of Public Prosecutions. At that hearing the judge opens the envelope and inspects the affidavit. Any affidavit or oral evidence to support the witness' objection is then adduced, and submissions are heard as to whether for the purposes of s 128(2) there are reasonable grounds for the objection, even though at that stage the plaintiff's counsel has not had access to the affidavit which is the subject of the objection. The judge then rules on that question. If the decision is that there are no reasonable grounds for the objection, the witness' obligation to comply with the disclosure order remains and must be satisfied. If there are reasonable grounds for the objection, then the Court gives the witness the warning required by s 128(2). If the witness chooses to give the evidence after hearing the warning, the Court directs that copies of the affidavit be provided to the legal representatives of the other parties, but that the contents not be disclosed to any other person. The affidavit is formally read and objections to admissibility are taken in the normal way. If there is a risk that this process will disclose the contents of the affidavit to persons other than the deponent and the legal representatives of the parties, it may be necessary for the court to be closed during this process. Once the affidavit has been read, the s 128 certificate is given and attached to it. If the witness elects not to give the evidence, then the Court hears any further submissions as to whether it should require the witness to give the evidence under s 128(5), and makes a determination accordingly. If the Court decides to require the witness to give the evidence, then it follows the procedure for the reading of the affidavit as outlined above. If the Court decides not to require the witness to give the evidence, the judge directs that all copies of the affidavit be returned to the witness' legal representative and authorises their destruction. Where evidence is given to which a certificate applies, the witness is protected by s 128(7) and there is a risk to the prosecuting authorities that their evidence in the criminal proceedings may be corrupted by knowledge of the witness' civil evidence. For at least that reason, steps should be taken to limit the use and dissemination of the protected evidence. In the HPM Industries case, Young J agreed that the appropriate procedure was to permit only the plaintiff's lawyers to see the information, subject to conditions set by the Court. As I have mentioned, there may on occasions be a special risk of prejudice to the witness even though a certificate is given, also justifying orders restricting the inspection of the evidence. The procedure which I have described involves the Court inspecting the affidavit before deciding whether the contents of the affidavit must be given in evidence. It also involves the legal representatives of other parties having access to the affidavit, although only after the deponent has decided to give the evidence or the Court has decided to require that the evidence be given. In my opinion this procedure is appropriate, and some such course is necessary, in order to comply with s 128, even in light of Reid v Howard and Vasil . " 31 Some doubts about the correctness of the Bax Global procedure were raised by Tobias JA in Griffin v Sogelease Australia Ltd (2003) 57 NSWLR 257, where his Honour said, at 269: An important issue arises as to whether s 128 of the Evidence Act 1995 can be invoked at the pre-trial stage of proceedings and, in particular, on an interlocutory application for an order for discovery or the production of documents. Thus, s 128(1) provides that the section applies "if a witness objects to giving particular evidence". Does that include a person, whether a party or not, who is subject to an application for an order for discovery or for the production of documents? What is the position if such a person with respect to whom an application is made for discovery or production declines to swear an affidavit in support of his objection such as is contemplated by Pt 23, r 5(b)? Again, even if the practice adopted by Equity Division with respect to disclosure orders ancillary to a Mareva order can be adapted to the compulsory production of documents pursuant to the rules referred to, is such a procedure consistent with the requirements of s 128(1) properly construed? There is no judicial authority directly in point. However, the learned author of Uniform Evidence Law , 5th ed (2002) Sydney, LBC Information Services at [1.3.12860] (S Odgers) suggests that s 128 applies only in court and that pre-trial contexts are still governed by the common law. The learned authors J Anderson, J Hunter and N Williams of The New Evidence Law: Annotations and Commentary on the Uniform Evidence Acts (2002) Chatswood, Butterworths, at 451 also express the view that the language and scheme of s 128 indicate that it only operates in a hearing context where there is a witness who objects to giving particular evidence and that the common law, and not s 128, governs the privilege against self-incrimination at the pre-trial stage and with respect to pre-trial processes: see, in particular, footnote 159 at 451. The learned authors, at 452, expressly query whether the procedure adopted in Bax Global is consistent with the decision of the High Court in Reid , given that s 128 may not be applicable to an order for the preparation and delivery of an affidavit of assets under the Mareva procedures." 32 In Ross v Internet Wines Pty Ltd [2004] NSWCA 195 the Court of Appeal disapproved the Bax Global procedure. One clear basis upon which the procedure was disapproved was that it required the creation of an affidavit, out of court, containing matter which might possibly infringe the privilege against self-incrimination. This basis was expressed by Giles JA (with whom Spigelman CJ and McColl JA agreed), at [101] - [102], as follows: "In my opinion, the appellant's position should be upheld. The appellant was obliged to deliver a disclosure affidavit to the judge's associate, and it would be "inspected" by the judge at a hearing. I will assume, without deciding, that the appellant would thereby be a witness for the purposes of s 128(1). But by compliance with the obligation his fundamental common law right would already be infringed. In order to have his claim to privilege determined, he would have to disclose the material which he said was incriminatory and should not be disclosed. There would be offence to the principle underlying the observation of Lord Denning MR in Rio Tinto Zinc Corporation v Westinghouse Electric Corporation (1978) AC 547 at 574, that a witness "should not be compelled to go into detail - because that may involve his disclosing the very matter to which he takes objection". See also Accident Insurance Mutual Holdings Ltd v McFadden cited above [(1993) 31 NSWLR 412 at 430], stating that the court will determine a claim to privilege "without requiring the witness fully to explain how the effect would be produced, for if it were necessary, the protection which the rule is designed to afford the witness would be annihilated." If the information in the disclosure affidavit tended to incriminate the appellant, he was imperilled because he had brought into existence an incriminatory document: the respondents' acceptance of infringement if it had been found that whatever was in the disclosure affidavit would infringe the appellant's privilege recognised the peril. The respondents submitted that the appellant was no more imperilled than a person who was ordered by subpoena to produce a document at court, the order being good and the claim to privilege being made at the time appointed for production. But that is different. The appellant was compelled to make a document which did not previously exist, and no longer had control of the document after its delivery to the judge's associate: all this without any s 128 certificate." 33 Section 128(7) Evidence Act 1995 is, fairly clearly, designed to provide protection against both direct use, and derivative use, of information, which would ordinarily be subject to a privilege against self-incrimination, but the disclosure of which is either compelled under section 128(5), or volunteered under section 128(2) and (3), or given in the circumstances to which section 128(4) applies. However, that protection is less than absolute. First, the protection it provides is only concerning evidence given "in any proceeding in a NSW court". There are questions, at present undecided, about whether such a certificate would prevent the evidence being given in proceedings in a Federal Court, or in a court of another State or Territory, or overseas. Second, the protection which it gives is against the evidence being used not merely in criminal proceedings, but "in any proceeding". To the extent to which a person compelled to make a disclosure might have a concern about it being used against him by a prosecuting authority, the obligations of fairness and propriety of Crown Prosecutors give good basis for confidence that information obtained directly or indirectly as a consequence of the disclosure would not be knowingly used. However, a Crown Prosecutor might not always know whether or not information in his or her brief had come directly or indirectly from a disclosure compelled under section 128 Evidence Act 1995. Similarly, while it would be professional misconduct for counsel for a co-accused in a criminal trial, or counsel in a civil trial, to knowingly use evidence to which a section 128 certificate related, or obtained as a direct or indirect consequence of such evidence, against the person who had given it, again, those people might not know that the source of information in their brief was such a disclosure. Third, if ever a dispute arose about whether evidence tendered in a trial was inadmissible because of section 128(7) Evidence Act 1995, it would be the party objecting who would have the onus of proving it was inadmissible. The evidence to make good that proof might not be available. It was matters such as these which Giles JA referred to in Ross v Internet Wines Pty Ltd [2004] NSWCA 195 when he said, at [99]: "It is important, in my view, to recognise that the balance struck by s 128 does not give the disclosing party complete protection. Disclosure to third parties, not necessarily prosecuting authorities, can lead to "the use of the testimony of the witness to search out other testimony to be used against him" ( Sorby v The Commonwealth (1983) 152 CLR 281 at 293 per Gibbs CJ, referring to Counsel v Hitchcock (1892) 142 US 547). There may be doubt whether information is obtained as a direct or indirect consequence of his giving the evidence, and questions of proof in that regard. There may be debate over the extra-territorial effect of a certificate, despite provisions in s 128 of the Commonwealth Evidence Act giving federal effect to them and notions of full faith and credit. As a balance of interests, s 128 necessarily impacts upon the disclosing party's common law privilege." 34 Mr Smark, counsel for the plaintiffs, submits that it is paras [101] and [102] of Ross (quoted at para [32] above) which contain its ratio decidendi. Paragraph [104] of Giles JA's judgment in Ross says: "I recognise the objective of the Bax Global (Australia) Pty Ltd v Evans procedure in the administration of justice. In my opinion, however, it is impermissible for the court to substitute for a person's fundamental common law right the statutory balance of rights, supplemented by court-devised additional protection by way of artificially making the disclosing party a witness, closure of the Court, limitations on who can see the disclosure affidavit, or if privilege is upheld and no certificate is granted return of the affidavit to its maker; all not pursuant to statute but by the court devising a procedure intended to inhibit the direct or derivative use against the person of information tending to incriminate. Taking up the words in Reid v Howard at 17, it is - … inimical to the administration of justice for a civil court to compel self-incriminatory disclosures, while fashioning orders to prevent the use of the information thus obtained in a court vested with criminal jurisdiction with respect to the matters disclosed. Nor is justice served by the ad hoc modification or abrogation of a right of general application, particularly not one as fundamental and as important as the privilege against self-incrimination." 35 Mr Smark submits that, when paras [101] and [102] of Ross are sufficient to justify the conclusion arrived at, para [104] should not be treated as part of the ratio decidendi. I do not agree that that is an appropriate method of finding a ratio decidendi. If a judge has given two reasons for a conclusion, both reasons are authoritative, even if one of them would have been sufficient for the conclusion: see cases collected in Re French Caledonia Travel [2003] NSWSC 1008; (2003) 48 ACSR 97; (2003) 204 ALR 353; (2003) 22 ACLC 498 at [77]. In my view, para [104] of Ross is a separate reason which Giles JA gave for arriving at the conclusion in that case. Hence, it is binding on me. 36 Mr Smark also seeks to distinguish para [104] of Ross. He submits that, in the present case, there would be nothing "artificial" about making the first defendant a witness in the way the plaintiffs seek - rather, his becoming a witness, and being required to answer questions about his assets, would be an ordinary incident of the Court's jurisdiction to require disclosure pursuant to Mareva orders. In one sense, that submission is correct. However, it is not in that sense that Giles JA was talking when he said it was impermissible to substitute for the privilege against self-incrimination court-devised procedures including "artificially making the disclosing party a witness". I read his Honour as saying that it is wrong for the Court to deliberately fashion a procedure with the aim of making someone a witness so that his privilege against self-incrimination can be circumvented. 37 Even if I were wrong in concluding that para [104] of Ross was part of its ratio, I would still follow the thought which I take to be expressed by para [104], and in so doing come to the conclusion that the order which the plaintiffs seek should not be made. In the present case, it is quite clear that the first defendant wishes to claim a privilege against self-incrimination concerning information relating to the money which the plaintiffs have found to be missing. He has already made such a claim concerning documents produced pursuant to the Anton Piller order. The submissions of his counsel, Mr Allen, before me, explored the way in which his privilege against self-incrimination might be eroded if he were ordered to come to court and answer questions about his assets, and that possibility of erosion was relied upon by Mr Allen as a reason why the order should not be made. 38 One matter which Mr Allen relied upon is that before a court can decide, under section 128 Evidence Act 1995, that it will either give a witness the opportunity of giving evidence voluntarily but with the protection of a section 128 certificate, or require the evidence to be given under protection of such a certificate, the court must first find that there are reasonable grounds for the objection to giving evidence on the ground of privilege. Before the court has an evidentiary foundation for making such a finding, it is often necessary for at least some of the basis of the witness's concern to become known to the court. Making even that information available to the court could increase the prospects of a witness being convicted, either by direct use of the evidence which the witness gave, or by a train of inquiry leading from it. It is not clear, he submits, that a certificate granted under section 128 Evidence Act 1995 would cover the sort of preliminary disclosure which was necessary before the court could decide there were reasonable grounds for the objection. While I accept Mr Allen's analysis of the law concerning this point, I do not think it provides a reason why, as a matter of fact, the order which the plaintiffs seek should not be made in the present case. In my view, in the present case the reasonableness of the first defendant's apprehension is quite apparent from the circumstances, and could be established without him giving a word of evidence. Indeed, the plaintiffs concede as much. 39 More fundamentally, the order which the plaintiff seeks would involve the first defendant being compelled to be in the situation of a witness. He would not be in the situation of a witness at all if such an order were not made. The only reason for putting him into the situation of a witness is so that the privilege against self-incrimination which he would otherwise have can be got around. True, if it were to be got around, it would be got around on the basis of providing him with a certificate under section 128 Evidence Act 1995 which would protect him from quite a few, though possibly not all, of the potential harmful consequences of his being required to disclose the privileged information. Even though in one sense the Court has jurisdiction to require a person to give evidence on oath, about his assets in connection with a Mareva order, it would be a wrong exercise of discretion to require such disclosure to be made when it cuts down a privilege against self-incrimination in circumstances where the legislature has not clearly indicated it is appropriate to cut the privilege down. 40 Section 128 Evidence Act 1995 is a provision of quite general application, applying to any witness (which includes a party) giving evidence in a New South Wales court. The situation of a person who has been ordered to become a witness by order of the Court, is within the literal words of section 128 - indeed, any reluctant witness who is only in court because he or she has been served with a subpoena to give evidence, is such a witness. However, here the real reason why the Court is being asked to make the first defendant a witness is so that his privilege against self-incrimination can be compromised. That privilege is preserved by all the other usual pre-trial procedures of the Court. The first defendant has it within his own power to preserve it at the trial, by not giving evidence. It is only by the active involvement of the Court, in setting a time and place for a special hearing which otherwise would never occur, that the first defendant would become a witness. I am not persuaded that these are circumstances within the scope of the circumstances for which Parliament intended section 128 Evidence Act 1995 to provide an exception to the privilege against self-incrimination. 41 If the order which the plaintiffs seek had been made, there are some other problems, which were raised in argument, which would have needed to be considered. The purpose for which the examination would have been permitted would have been to assist in ensuring that the Court's processes for enforcement of a judgment were not frustrated by assets being spirited away between the time of commencement of proceedings, and eventual enforcement. Yet the topic on which examination would occur, namely what has become of the assets which the plaintiff has found to be missing, is a topic which may well be a subject on which the plaintiff seeks to call evidence at the trial. Any sensible plaintiff, in the situation of the present plaintiffs, would seek, if it were possible, to establish a proprietary claim to particular existing assets of the defendant, or persons to whom the defendant might have transferred the assets, rather than rely upon obtaining a purely personal monetary judgment against the defendant. For making out such a case, identifying what has become of the missing assets is essential. Yet, if the plaintiff were to seek discovery or interrogatories concerning what has become of the missing assets for the purpose of mounting such a tracing claim, the defendant could resist that application on the grounds of privilege against self-incrimination. There is power for the Court to order an interrogated party who "fails to answer an interrogatory sufficiently" to attend court to be orally examined (Supreme Court Rules 1970 Part 24, rule 8), but there is nothing insufficient about an answer to an interrogatory which claims a privilege against self-incrimination. Such an answer is one which the law permits. 42 Thus, if the examination were to occur in aid of a Mareva order, it might be an abuse of process for information derived from it to be used to make out a substantive case at a hearing. It is a familiar enough principle that documents produced on discovery cannot be used, without the leave of the Court, for any purpose other than the conduct of the proceedings in which they were produced: Harman v Secretary of State for the Home Department [1983] 1 AC 280. However, that principle arises in a context where the purpose of the compulsory disclosure through discovery was for the running of the action. In the present case, if disclosure of information were to be compelled, it would not be for the purpose of the running of the action, but rather for protection of enforcement of any judgment. If the only basis upon which disclosure was compelled at an oral hearing (like that sought by the plaintiff) was pursuant to section 128 Evidence Act 1995, rather than pursuant to a more general exception to the privilege against self-incrimination like that contained in section 31(1) Theft Act 1968 (UK), a procedure would probably need to be devised to ensure that use was not made, in the proceedings itself, of information which had been obtained on that hearing. One element of such a procedure, Mr Smark suggested, might be to refuse to allow the defendant, if he gave evidence at the trial, to be cross-examined by using evidence given at the asset disclosure hearing as a prior inconsistent statement. Alternatively, perhaps nothing short of using a different legal team for the asset disclosure hearing and the substantive hearing, and ensuring no information disclosed on the asset disclosure hearing came to the attention of the legal team conducting the substantive hearing, would suffice. 43 However, in circumstances where I have come to the view that it is not appropriate to require the first defendant to attend for examination in aid of the Mareva orders, it is not necessary to consider these matters further. 44 Regardless of the terms of Part 24, rule 8 Supreme Court Rules 1970, the Court has, at least in theory, power to order a party to litigation to attend to answer questions orally for the purpose of obtaining admissions to use as evidence at the hearing. However, such a compelling of disclosure by delivery of oral interrogatories is well beyond the ordinary course of procedure in this State. The only reason for adopting it in the present case would be to get around the first defendant's privilege against self-incrimination. The same objections apply to a hearing for delivery of oral interrogatories as apply to an oral hearing in support of Mareva orders. Law Reform 45 I make the following remarks divorced from the factual context of the present case, and without in any way prejudging the situation of the first defendant. 46 The interaction of the law concerning privilege against self-incrimination and the law concerning compulsory disclosure of information for the purpose of civil proceedings is not at present coherent. In the area with which the present case deals, concerning recovery of assets alleged to have been misappropriated, statute, in the form of sections 177 and 178 Crimes Act 1900 has gone some way towards giving effect to a policy that a thief ought not be able to rely upon the privilege against self-incrimination to frustrate civil proceedings aimed at making him give back what he has dishonestly obtained. That policy can also be seen as providing part of the reason for section 597 (12) and (12A) Corporations Act 2001 (Cth) abrogating the privilege against self-incrimination, with some protection, in public examinations about a corporation's examinable affairs conducted by a liquidator or other "eligible applicant". However, given the way that sections 177 and 178 Crimes Act 1900 do not attach to all offences involving obtaining property through dishonesty, the policy is imperfectly implemented. Concerning the closely analogous area of dishonest appropriation of the intangible rights involved in intellectual property and goodwill, it is not implemented at all. Part of the reason for this is because there is no New South Wales equivalent of section 31(1) Theft Act 1968 (UK), or section 72 Supreme Court Act 1981 (UK). Yet, as AT&T Istel Ltd v Tully [1993] AC 45 illustrates, if exceptions to the privilege against self-incrimination are introduced by reference to the subject matter of particular charges, there will always be a possible charge which is outside the list concerning which the privilege is abrogated, and where the case for abrogation seems as strong as concerning those charges for which abrogation has occurred. 47 The lack of coherence in this area of the law has become of particular importance as a result of several different developments in recent decades. One of them is the development of Mareva orders and Anton Piller orders, arising from the decisions in Nippon Yusen Kaisha v Karageorgis [1975] 1 WLR 1093, Mareva Compania Naviera SA v International Bulkcarriers SA [1980] 1 All ER 213, EMI Ltd v Pandit [1975] 1 WLR 302 and Anton Piller KG v Manufacturing Processes Ltd [1976] Ch 55. Another is the recognition that the "felonious tort rule" (Smith and wife v Selwyn [1914] 3 KB 98) has been superseded so that it is now possible for both criminal and civil courts to investigate the same question of whether conduct which amounts to a crime has occurred, subject to the control that the civil court has an inherent jurisdiction to order a stay of the civil proceedings where the conduct of those proceedings may interfere with the fair trial of the criminal proceedings: McMahon v Gould (1982) 7 ACLR 202; 1 ACLC 98; Halabi v Westpac Banking Corporation (1989) 17 NSWLR 26. Another is the introduction of section 128 Evidence Act 1995. 48 Even if there were to be legislation which legitimised the Equity Division practice described in Bax Global (Australia) Pty Ltd v Evans (1999) 47 NSWLR 538, care would need to be taken about whether the cutting down of the privilege against self-incrimination so enacted was one which applied only to Mareva style relief, or whether it also enabled information to be obtained for the purpose of use in deciding the merits of property recovery proceedings. Alternatively, given the serious criticisms that have been voiced (eg in AT&T Istel Ltd v Tully [1993] AC 45) about the continued appropriateness of the privilege against self-incrimination when the incrimination occurs in the context of civil proceedings, a case may be able to be made for a court to have power, analogous to that contained in section 128 Evidence Act 1995, to compel disclosure in any of the court's interlocutory proceedings (whether by way of discovery, or interrogatories, or any other interlocutory proceedings), on terms of provision of a certificate. 49 These questions involve looking at the scope of existing law, and considerations of policy, which go wider than a judge writing a judgment can, or should, decide. One of the policy questions involved is whether, when there has been a dishonest appropriation of property, it is more important for the owner to get his property back, or for the wrongdoer to be punished, or whether both can be achieved. That this is no new question is shown by the fact that part of the mythology of the New South Wales Bar involves the country jury which returned a verdict of "not guilty, but he's got to give the sheep back". These are topics appropriate to be considered by the New South Wales Law Reform Commission, or some other body which examines legislative policy. I note that the New South Wales Law Reform Commission currently has before it a reference from the Attorney-General, received 2 July 2004, to review the Evidence Act 1995 having particular regard to, amongst other things, privileges. As well, a proposal for a new Civil Procedure Bill is contemplating conferring on the court a power analogous to section 128 Evidence Act 1995, to be applied in all interlocutory proceedings. Such a power would make quite clear that it was Parliament's intention that an order of the type the plaintiffs now seek could be made. In my view the matters referred to in this judgment could usefully be considered in connection with both the New South Wales Law Reform Commission reference, and the proposal for the Civil Procedure Bill. Orders 50 The Plaintiffs' application is dismissed, with costs. **********

Pathways Employment Services v West

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