Patrick Stevedores Operations No 2 Pty Ltd & Anor v Essential Services Commission & Ors [2022] VSC 175

2 In support of its application, the plaintiffs filed the affidavit of their solicitor Andrew Floro affirmed 15 November 2021. Mr Floro's affidavit exhibited a number of documents said to be confidential (Exhibit AAF-2).

3 This ruling concerns the plaintiffs' application by summons filed on 23 March 2022 seeking orders that Exhibit AAF-2, other than one document within the exhibit, be kept confidential and only accessed by PoM's solicitors and counsel and, on entering into a confidentiality undertaking, its General Counsel.

4 The plaintiffs' application is made pursuant to the inherent jurisdiction of the Court.

5 PoM was joined to the proceeding one month after it was commenced. PoM oppose the plaintiffs' application for confidentiality orders.

6 Neither the ESC nor the Assistant Treasurer[1] (who was joined to the proceeding as the third defendant on the same day the plaintiffs' summons was heard), sought to be heard on the plaintiffs' application for confidentiality orders.

7 For the reasons that follow, I have decided that the plaintiffs' summons filed 23 March 2022 should be dismissed.

8 The plaintiffs' operations require an ongoing and productive commercial relationship with PoM. PoM is the private operator of the Port of Melbourne, a large port for containers and general cargo in Victoria. PoM is the monopoly provider of land at the Port of Melbourne, which is land the plaintiffs require to continue stevedoring operations at that port. The plaintiffs are users of prescribed services and the lessee under long term leases with PoM.

9 The plaintiffs, as port users and stakeholders, have information and opinions relevant to the regulation of PoM and its compliance with the regulatory regime[2] for the benefit of port users and the long term interests of Victorian consumers.

10 Exhibit AAF-2 contains correspondence between the plaintiffs and the ESC and between the plaintiffs and relevant ministers. The plaintiffs say that the correspondence was made in the context of confidential communications with the regulator. That correspondence contains representations made by the plaintiffs that are critical of PoM and its conduct at the port including representations regarding its view of PoM's non-compliance with the Pricing Order and the regulatory regime, and the failure of the ESC to conduct an inquiry in accordance with the terms of the PMA.

11 At the time of filing Mr Floro's affidavit affirmed 15 November 2021, the only other party to the proceeding was the ESC. Following PoM's joinder in December 2021, the parties entered into an interim arrangement to allow PoM access to Exhibit AAF-2. That arrangement allowed PoM's solicitors and counsel to access the exhibit and, on the giving of a confidentiality undertaking, PoM's General Counsel to also access the exhibit. Also, the plaintiffs undertook not to rely on Exhibit AAF-2 at the hearing (but would still rely on the paragraphs of Mr Floro's affidavit referring to the documents in the exhibit) but reserved their right to seek to rely on the exhibit in order to respond to evidence adduced by the ESC or PoM.

12 The plaintiffs and PoM were in agreement about the principles relevant to this application.

13 In Cargill Australia Ltd v Viterra Malt Pty Ltd (No 23),[3] Elliott J summarised those principles as follows:

First, the court will only make a confidentiality order where confidentiality is necessary for the administration of justice. In other words, a confidentiality order:

must be "necessary in order to serve the ends of justice", "necessary to secure the proper administration of justice in proceedings" or necessary to avoid a course which would "destroy the attainment of justice in the particular case".

Necessity is a stringent standard. It is not enough that a confidentiality order appear to be convenient, reasonable, sensible, or be perceived to be in the public interest, however understood, or that "as a result of some 'balancing exercise', the order appears to have one or more of those characteristics". Further, and for obvious reasons, it is not enough that the applicant merely wishes to avoid scrutiny or maintain confidence, or subjectively believes the orders sought to be necessary. Furthermore, whilst relevant, it is not enough that the parties to a proceeding agree that a confidentiality order should be made, or that, as here, an application for a confidentiality order is not opposed. This is because the rationale of the principle of open justice is exposure to public scrutiny, to which the parties to a proceeding may be unanimously averse.

Secondly, it is not enough that the applicant merely assert confidentiality in respect of the information sought to be protected; rather, the applicant must identify a basis for the court to maintain the confidentiality. Relatedly, it is ordinarily for the applicant to adduce evidence upon which the court may reasonably conclude that the standard of necessity has been met. Specifically, the applicant must ordinarily adduce evidence of some apprehended particular or specific harm or damage that disclosure of the information the subject of the proposed order would cause.

Thirdly, the protection of commercially-sensitive information may, in appropriate cases, be necessary to the administration of justice. This is because the administration of justice requires that controversies between parties be resolved without a party, or a non-party, suffering severe and collateral commercial harm. As has been observed:

Parties should not be deterred from coming to courts to enforce or protect their rights for fear that in doing so they will be forced to lose the very foundation of their commercial success ... or that they may lose some competitive advantage that derives from material that they rightly consider to be confidential or secret.

For example, it is well-accepted that the principle of open justice may, in appropriate cases, accommodate the protection of trade-sensitive information, such as "prices and costs paid and incurred" for valuable items, supplier terms, and commercially-sensitive aspects of goods and services sold.

Fourthly, where a confidentiality order is sought in respect of commercial information, it is for the applicant to establish that each piece of commercial information in respect of which a confidentiality order is sought has a confidential character warranting the protection of a court order.

Fifthly, the strength of an asserted need for confidentiality will necessarily vary according to context, and in light of matters including:

(1) The nature of the proceeding in which confidentiality is sought.

(2) The nature of the information in respect of which a confidentiality order is sought.

(3) Whether or not the information has already been received into evidence, or deployed in open court.

(4) The likelihood and severity of collateral damage to participants in the court proceeding or others, absent the confidentiality order sought.

(5) The nature and extent of the confidentiality order sought and how it would operate to interfere with the principle of open justice.

Finally, it is necessary to consider what effect, if any, the making of a confidentiality order in respect of certain evidence may have on the ability of the court to provide cogent reasons for its judgment in a proceeding. As was observed in Wainohu v New South Wales, the obligation on courts to provide adequate reasons for judgment is itself an aspect of the open justice principle. Plainly, where certain evidence is made subject to a confidentiality order, the court may be deprived of the opportunity to include and openly refer to that evidence in its published reasons. Whether that constitutes a significant obstacle may depend on whether or not, without relying on the confidential information, and by formulating its reasons in more general terms, the court may nonetheless "convey an adequate account of the litigation and the reasons underlying the orders".[4]

14 In the interests of brevity, I have summarised the submissions made by both the plaintiffs and PoM in the table annexed to these reasons titled 'Annexure A'. The first three columns in the annexed table sets out, verbatim, the table which was annexed to the plaintiffs' submissions filed 23 March 2022. The fourth column sets out my brief summary of PoM's submissions.

15 In the final column of the annexed table, I have provided my ruling in relation to each corresponding document comprising Exhibit AFF-2.

16 It is however helpful to set out some of the plaintiffs' submissions applicable to all of the documents. First, the plaintiffs submit that the Court should have regard to the context in which the communications were made. In that regard, the plaintiffs refer to the evidence of Ms Lisa Hopkinson, Principal Legal Counsel in the Price Regulation and Monitoring Division of the ESC. Ms Hopkinson states in her affidavit affirmed 28 March 2022 that the ability of persons with an interest in the ESC's functions to provide information that is confidential or commercially sensitive to the ESC and to have confidence that such information will not be disclosed is critical to the proper performance of the ESC's functions. The absence of such confidence may mean that some persons are unwilling to provide information to the ESC at all or may not be as full and frank in providing information.

17 I readily accept that the ESC relies on confidentiality to obtain full and frank information from stakeholders that is uses it to fulfil its statutory functions. It is one thing for the ESC to maintain confidence in information that is provided to it. That is, however, quite different to the situation in this proceeding. The plaintiffs do not seek confidentiality orders in relation to material filed by the ESC. In this instance, it is the plaintiffs who provided the information said to be confidential to the ESC and it is the plaintiffs who have filed that information, including the ESC's responsive correspondence, in this proceeding.

18 Second, the plaintiffs say the confidential communications were made in the context where the plaintiffs, as tenant, were complaining about the actions of its monopolistic landlord to the landlord's statutory regulator. Given the relative positions of the plaintiffs and PoM, the plaintiffs were and are concerned that if the information is made public, it would expose the plaintiffs to the possibility of reprisals or repercussions. The plaintiffs articulate the potential harm if the information is not kept confidential, as follows. First, the plaintiffs fears damage to their commercial relationship with PoM by disclosing to PoM and their shareholders damaging suggestions and representations about PoM's behaviour. Second, the plaintiffs say they may be more circumspect in their future communications with the ESC in relation to the operation and development of the Port of Melbourne. Third, disclosure of the information would harm Victorian consumers by discouraging the plaintiffs and others from making future submissions to the ESC or the Victorian Government about PoM's conduct in providing proscribed services and its broader operation and development of the Port of Melbourne.

19 In my view, the plaintiffs' evidence about potential harm if confidentiality in the material is not maintained is put at such a level of generality that it cannot be afforded significant weight. While the plaintiffs' propositions regarding harm are plausible, they do not rise far above the level of general speculation.

20 The plaintiffs submit that the Exhibit AAF-2 was filed to give the Court context about the discussions between the plaintiffs and the ESC prior to the finalisation of the price order inquiry. The inquiry having now been finalised, the communications are not relevant to the decision to be made by the Court in the proceeding. Related to this submission, the plaintiffs contend that to the extent the confidential information concerns the ESC's inquiry under s 49Q, it is irrelevant to the decision to be made by the Court in this proceeding.

21 I accept that parts of the communications making up Exhibit AAF-2 are likely to be irrelevant to the decision the Court is asked to make in the substantive proceeding. Irrelevance to the central issues before the Court is not, in itself, a basis to maintain confidentiality. I accept it forms part of the context in which the Court must determine whether to make an order preserving confidentiality.

22 Third, the plaintiffs submit maintaining confidentiality in the exhibit will not impede PoM's legal representatives from obtaining instructions. It seems to me that this submission directs attention away from the onus on the plaintiffs to establish confidentiality and the necessity for the Court to maintain that confidentiality.

23 For the short reasons noted in the annexed table, I have decided that the plaintiffs' summons filed 23 March 2022 should be dismissed.

12 August 2021, letter from Patrick to ESC Chair and Commissioners - re concern WDE Expansion Project not being considered under the s49I review as required.

Floro Affidavit (at [15]) says that this letter concerned "the ESC... failing to consider, as part of its Inquiry, PoM's acceleration of the Webb Dock precinct development and the inclusion of forecast expenditure related to the Webb Dock East Knuckle removal...in the capital base of the purposes of setting and publishing within the review period Prescribed Service Tariffs in the TCS 2021-22."

This submission has some similarities to Patrick's 25 August 2021 letter of which there is a public version. The key differences include:

- concerns about PoM not sending Patrick a document they sent to other stakeholders;

- references to Patrick's previous engagement with the ESC including previous submissions, Counsel's opinion and otherwise;

 PoM is the Landlord and Patrick has an ongoing commercial relationship with them (this applies to all documents below).

 Patrick refers to a document sent by PoM to some stakeholders, which was not directly received by Patrick despite being an affected stakeholder.

 Refers to Patrick's prior engagement with the ESC in relation to the Inquiry, which is not public. This includes references to the substance of previous engagement.

The plaintiffs' submission as to the landlord relationship amounts to a request, framed as "don't upset them". They are not trade rivals and PoM is a regulated entity.

The plaintiffs' submission that the confidentiality order protects the source is not a legitimate reason for confidentiality because PoM know what it sent to the plaintiffs and is also aware that the plaintiffs received material from a third party.

PoM is already aware of material listed at p217 and has the advice referred to. Material already filed in this proceeding makes clear the plaintiffs were communicating extensively with the ESC.

The substance of the letter is about the scope of inquiry. This was a matter already known by PoM.

In my view, a confidentiality order is not necessary for the administration of justice.

While the plaintiffs assert confidentiality, the basis for the Court to maintain the confidentiality is not demonstrated. The plaintiffs' complaints in the correspondence are directly referrable to the subject of the proceeding and are very similar to those made in the plaintiffs' letter to the ESC dated 15 August 2021, over which the plaintiff does not make a claim of confidentiality. The fact that the plaintiffs had prior engagement with the ESC in relation to the subject of the inquiry is not confidential. I also note that the counsel's opinion, referred to in the letter, has already been provided to PoM.

The plaintiffs have not established the confidential character of the information in this letter.

20 August 2021, response from the ESC to Patrick's 12 August letter

Floro Affidavit (at [16]) says that the ESC responded to Patrick's letter [of 12 August 2021].

Otherwise, PoM has no knowledge of this letter and its substance.

Recognition by ESC that the 12 August 2021 letter is not on the public record.

The ESC's letter is in effect a holding letter acknowledging the plaintiffs' correspondence and does not address the substance of the plaintiffs' complaint.

A confidentiality order is not necessary for the administration of justice.

The fact that the ESC acknowledges that the plaintiffs' letter of 12 August 20221 was provided on a confidential basis does not make this letter confidential.

There is nothing in the substance of this letter that otherwise appears commercially sensitive.

Floro (at [17]) says that Patrick wrote to "Minister Horne MP, Mr Pallas MP and Mr Pearson MP (copying the ESC) requesting (among other things) that the Victorian Government ensures that the ESC includes the prudency and efficiency of the accelerated WDE Expansion Project within the Inquiry."

Woodward Affidavit (at [16]) includes the following excerpt of the document: "If this project goes ahead, in the significantly accelerated timeline compared to the 2050 PDS, it has the potential to cause irreparable harm to port users and Victorian consumers contrary to the core objectives of the regulatory regime set out under section 48(1) of the Port Management Act 1995 (Vic) (PMA)...

Inefficient and premature investment in the WDE Extension Project (which will bring forward other significant Webb Dock developments including a fourth container terminal at Webb Dock North and the Webb Dock Freight Link) in circumstances where there is excess capacity forecast for the medium term will lead to significant costs in order to accommodate these changes earlier than required (and expressed to industry), and little ability to reverse impacts once set in motion."

Otherwise, PoM has no knowledge of this letter and its substance.

 Reveals prior engagement with Government re concerns around the WDE project.

 Refers to communication from Minister (a 12 August 2021 letter) and the content of that. This is not included elsewhere in the affidavits and is not otherwise public.

 Refers to 12 August letter to ESC (item 1) and the content of that letter.

 Requests made of the Government about the WDE expansion project not public - issue given commercial relationship.

 Public interest in stakeholders not only feeling they can provide relevant information to the regulator but also to the Minister to ensure that PoM is held accountable as the privatised owner of the Port.

 Any content relevant to PoM in the JR proceeding - available through the submissions made public under the ESC's process.

Prior engagement with the Government is not a basis for confidentiality.

The fact of the letter and some of its substance was disclosed in Mr Floro's affidavit affirmed 15 November 2021, at [17]. The plaintiffs are therefore seeking confidentiality orders over material that is otherwise in the public domain.

Mr Woodward's affidavit affirmed 22 November 2021, at [16] discloses verbatim a significant portion of the document.

A confidentiality order is not necessary for the administration of justice.

The plaintiffs have not demonstrated why the fact of their prior engagement with Government is confidential.

The plaintiffs' concerns, expressed to the Ministers, about the WDE Extension Project is referred to in the plaintiffs' affidavit material filed in the proceeding, over which no claim for confidentiality has been made.

In these circumstances, the plaintiffs have not established the confidential character of the information in this letter.

20 August letter to ESC - Formal complaint under s49Q

Floro (at [18]) says that "Patrick made a complaint to the ESC under section 49Q of the PMA."

Otherwise, PoM has no knowledge of this letter and its substance.

 Communication made to the regulator and addressed to the Chair, noting the significance of the material.

This document is not confidential because the identity of the complainant and the substance of the plaintiffs' complaint are known to PoM.

Mr Floro's affidavit affirmed 15 November 2021, at [18] and Mr Woodward's affidavit affirmed 22 November 2021, at [20] both disclose the existence of the complaint.

The substance of the complaint is also disclosed by the ESC in Ms Hopkinson's affidavit affirmed 11 February 2022, at [11].

A confidentiality order is not necessary for the administration of justice.

I am not satisfied that the confidential character of the letter has been established. The mere fact that a document is marked 'Private and confidential' is not conclusive. It is incumbent on the plaintiffs to demonstrate the confidential character of the information within the correspondence and the necessity to keep that information confidential. The plaintiffs have not discharged that onus.

The letter refers to the plaintiffs' concerns, as outlined in its Interim Submission and their letter to the ESC dated 12 August 2021 having been 'raised with PoM on a number of occasions including at the ESC's public forum on 15 July 2021.' If the information has been disclosed at a public forum, it is difficult to see how the information remains confidential.

The fact that the plaintiffs made a complaint about PoM under s 49Q of the PMA is disclosed in the affidavit of Mr Floro affirmed 15 November 2021 and the affidavit of Mr Woodward affirmed 22 November 2021. This fact undercuts the plaintiffs' submission that this information is confidential.

The substance of the plaintiffs' complaint under s 49Q of the PMA is summarised in the affidavit of Ms Hopkinson affirmed 11 February 2022. It follows that the plaintiffs have not demonstrated the confidential character of this information.

25 August Patrick letter to ESC re the need to review the WDE project under the 49I inquiry

There is a public redacted version which only redacts the email address.

 Patrick does not seek confidentiality orders over this document.

No confidentiality order was sought in respect of this document.

3 September 2021 - ESC letter to Patrick - re commencement of 49Q investigation

 Refers to the letter of 20 August (item 4) and the purpose of that letter.

 Makes a request from the regulator for the investigation to be kept confidential.

The mere fact the letter was sent from the regulator is not sufficient to establish a confidential character.

Further, the request from the regulator was time limited and that time period has now passed.

A confidentiality order is not necessary for the administration of justice.

The fact that the plaintiffs made a complaint about PoM under s 49Q of the PMA is disclosed in the affidavit of Mr Floro affirmed 15 November 2021 and the affidavit of Mr Woodward affirmed 22 November 2021.

The substance of the plaintiffs' complaint under s 49Q of the PMA is summarised in the affidavit of Ms Hopkinson affirmed 11 February 2022.

The ESC's request that the plaintiffs keep the ESC's process of handling the s 49Q complaint confidential was limited to the first stage of its investigation, which is now completed.

The plaintiffs have not demonstrated that the information is of a confidential character nor that a Court order is necessary to maintain confidentiality.

13-16 Sept - Email correspondence re timing update on ESC response in relation to position on scope and meeting to discuss matters

Floro (at [21]) says "Victoria Moore, Patrick's General Counsel, Strategy and External Affairs sent an email to Marcus Crudden, Executive Director, Price Monitoring and Regulation at the ESC. Marcus Crudden responded to Victoria Moore's email on 16 September 2021."

Otherwise, PoM has no knowledge of this email chain and its substance.

 Confidential communications to and from the regulator, shows level of concern by Patrick regarding ESC's decisions.

Correspondence with the regulator is not a sufficient basis to assert that the correspondence holds a confidential character. A document disclosing the plaintiffs' complaints or concerns with the ESC are not confidential matters.

Mr Floro's affidavit affirmed 15 November 2021, at [21] and Mr Woodward's affidavit affirmed 22 November 2022, at [13(d)] both disclose existence of these communications.

The confidentiality order is not necessary for the administration of justice.

The plaintiffs have not established how or why their 'level of concern' regarding the ESC's decision is itself commercially sensitive such as to require a confidentiality order. The plaintiffs have failed to sufficiently substantiate the basis for the confidential character of the information.

17 September email M Crudden to Moore - response to 25 August letter request re whether WDE Project in scope

Floro (at [22]) says "the ESC responded to Patrick's letter of 25 August 2021 by email and provided a copy of Queen's Counsel's advice taken by the ESC."

PoM is also aware of the substance of this letter e.g. that the ESC followed Queens counsel opinion.

 Confidential communication between ESC and a stakeholder.

Correspondence with the regulator is not a sufficient basis to assert that the correspondence holds a confidential character.

Mr Floro's affidavit affirmed 15 November 2021, [22] discloses the existence of this communication.

A similar description of this correspondence in contained in Mr Woodward's affidavit affirmed 22 November 2021, at [13(d)].

A confidentiality order is not necessary for the administration of justice.

The fact and substance of the plaintiffs' s 49Q complaint is known to PoM. Further, the ESC's counsels' advice is publicly available. The plaintiffs have not demonstrated the confidential character of the information or the necessity for a Court order to maintain confidentiality.

There is no information in this email that appears to be commercially sensitive such as to require a confidentiality order.

11 October 2021 letter to ESC re scope and enclosing the Neil QC and Brendan Lim opinion in response to the Hanks QC- Dermody opinion.

Floro (at [23]) says "Patrick wrote to the ESC and enclosed a joint opinion of Neil Young QC and Brendan Lim about the scope of the ESC's Inquiry."

PoM has access to the Neil Young QC and Brendan Lim opinion, which is at pages 197 to 204 of AAF-1, and there is a public copy on the ESC website. The Hanks QC - Dermody opinion has been published on the ESC website.

 Confidential communication between Patrick and the regulator.

 Revealing the level engagement by Patrick as sent to Chair.

 Refers to Patrick's other engagement with the ESC (21 September 2021 meeting).

Correspondence with the regulator is not enough to make a document confidential.

References to the plaintiffs' previous engagement is innocuous and is not a basis for confidentiality.

Mr Floro's affidavit affirmed 15 November 2021, at [23] and Mr Woodward's affidavit affirmed 22 November 2022, at [13(f)] both disclose the existence of these communications.

A confidentiality order is not necessary for the administration of justice.

The fact that the plaintiffs had previously engaged with the ESC about the inquiry lacks the character of commercially sensitive information requiring a confidentiality order.

I am not satisfied that prior engagement with the regulator and the level of that engagement is information of a confidential nature.

The plaintiffs' counsel's opinion referred to in the letter has previously been provided to PoM, i.e. that document is not confidential.

21 October letter from ESC Chair noting the provision of the Neil Young QC and Brendan Lim joint opinion to the ESC and the Minister; the ESC's position on the scope of the inquiry; and the commencement of the 49Q investigation

Floro (at [24]) says "the ESC replied to Patrick's correspondence. The ESC confirmed that, following the Queens's Counsel's advice dated 13 September 2021, the ESC would conduct and complete its Inquiry on the basis that PoM's inclusion of forecast expenditure related to the WDE Expansion Project in the capital base for the purposes of setting Prescribed Service Tariffs in the TCS 2021-22 published on 31 May 2021 was not within the scope of the Inquiry."

Otherwise, PoM has no knowledge of this email chain and its substance. As above (item 9), PoM has both the Neil Young QC and the Brendan Lim opinion Hanks QC - Dermody opinion.

ESC decision also sets out that the ESC will follow the Hanks QC and Dermody opinion.

 Shows level of engagement - ESC Chair and Minister

Correspondence with the regulator is not enough to make a document confidential.

References to the plaintiffs' previous engagement is innocuous and is not a basis for confidentiality.

Mr Floro's affidavit affirmed 15 November 2021, at [24] and Mr Woodward's affidavit affirmed 22 November 2021, at [13(g)] both disclose existence of these communications.

A confidentiality order is not necessary for the administration of justice.

The plaintiffs have not established that its 'level of engagement' is commercially sensitive information requiring a confidentiality order.

PoM has counsel's opinions referred to in the letter.

PATRICK STEVEDORES OPERATIONS NO 2 PTY LTD (ACN 056 292 687)

ASSISTANT TREASURER, MINISTER ADMINISTERING THE ESSENTIAL SERVICES COMMISSION ACT 2001 (VIC)

[1] Assistant Treasurer, Minister administering the Essential Services Commission Act 2001 (Vic).

[2] As required by the Port Management Act 1995 (Vic) and other relevant legislation.

[3] (2019) 58 VR 611.