Shellharbour City Council v Stewart

Shellharbour City Council v Stewart - [2008] NSWLEC 151 - NSWLEC 2008 case summary — Zoe

[27]

To say that a court must be reasonably satisfied ( Briginshaw , per Dixon J (at 362)) or affirmatively satisfied ( Kantor , per Buchanan JA and Phillips JA (at [16])) is one thing, but to say as did Puckeridge DCJ that the court must be comfortably satisfied is another thing altogether. His Honour appears to have been implying that proof to a higher standard than the balance of probabilities was required. If so, he was in error. 10 In Vines v Australian Securities and Investments Commission (2007) 62 ACSR 1, [2007] NSWCA 75 at [808] - [813] Ipp JA addressed the Briginshaw test as follows: Before coming to grips with the relevant factual issues, I propose to deal with some questions of law that bear on the issues for determination. The first is the relevance of the remarks of Dixon CJ in Briginshaw v Briginshaw (1938) 60 CLR 336. Throughout these proceedings, reference has been made to the Briginshaw test and the Briginshaw standard. But, in my view, Briginshaw is of limited assistance. Dixon CJ said in that case at 361 to 362: Except upon criminal issues to be proved by the prosecution, it is enough that the affirmative of an allegation is made out to the reasonable satisfaction of the tribunal. But reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters reasonable satisfaction should not be produced by inexact proofs, indefinite testimony, or indirect inferences. Nothing in Briginshaw detracts from the proposition that a serious allegation might be proved by circumstantial evidentiary facts and inference and circumstance (see Dixon CJ at 366). A more recent decision by the High Court on the same issue is Neat Holdings Pty Limited v Karajan Holdings Pty Limited (1992) 67 ALJR 170 where Mason CJ, Brennan, Deane and Gaudron JJ said at 171: [T]he strength of the evidence necessary to establish a fact or facts on the balance of probabilities may vary according to the nature of what it is sought to prove. Thus, authoritative statements have often been made to the effect that clear or cogent or strict proof is necessary where so serious a matter as fraud is to be found . Statements to that effect should not, however, be understood as directed to the standard of proof. Rather, they should be understood as merely reflecting a conventional perception that members of our society do not ordinarily engage in fraudulent or criminal conduct and a judicial approach that a court should not lightly make a finding that, on the balance of probabilities, a party to civil litigation has been guilty of such conduct.

[29]

11 It became common ground (at least as between the council and Councillor Rose) that the alleged breaches of s 664(1) and (1A) of the LG Act are serious but do not give rise to a criminal penalty. That was said to be because a maximum penalty is prescribed for a breach of subsection 664(3) but not for the preceding subsections, as is demonstrated by a comparison with s 666 where the legislature has prescribed a maximum penalty immediately after each of its individual subsections. On that basis, in deciding whether the case has been proved on the balance of probabilities, there should be taken into account the gravity of the matters alleged on the basis that they are serious but not as serious as they would be if they attracted criminal penalties. I propose to approach the matter in that way initially in relation to each of the three leaks. However, it is unnecessary to express a concluded view as to the correctness of that approach because my decision in relation to each of the leaks will be the same whether or not a contravention attracts a criminal penalty. 12 In a democracy there is a tension between the need to protect confidential information and the public's right to know. The legislature has addressed the line between the two by prohibiting disclosure of certain information in s 664 of the LG Act and by authorising a council to close meetings to the public in s 10A. Leaking information in contravention of s 664 defies the legislative will in a sensitive area. It is a breach of an obligation of confidence. It can deter, impede or inhibit the supply and discussion of, and decisions on, confidential information. It can undermine trust between councillors, between councillors and council management, and between the council and the public or third parties who provide confidential information on the basis that their confidences will be respected unless there is lawful excuse for disclosure. Those are some of the reasons, I think, why a breach of s 664(1) or (1A) may be regarded as serious in a case such as the present. Background to the present application 13 On 11 April 2006, following the March 2006 publication on the Forum, the council unanimously authorised the General Manager to commence an investigation into the source of the unauthorised disclosures. The General Manager retained KPMG Forensic and Maddocks, solicitors, to assist with the investigation. Following an investigation, in late 2006 the council commenced proceedings against Mrs Shirley Hollis and another person seeking orders that, among other things, they provide affidavits setting out what they knew about the matter. In early 2007 two more persons were added as respondents.

[36]

Brian Weir/Shellharbour City Council will: 1. Withdraw the present Land and Environment Court action against Mrs Shirley Hollis and Mr David Evans (and Mr Peter Moran if possible.) 2. Not pursue Shirley Hollis, David Evans or Peter Holstein for costs. 3. Guarantee Peter Holstein immunity from all further legal actions to do with these matters presently before the Land and Environment Court. 4. Guarantee confidentiality and continual non-disclosure of Peter Holstein and any third party he may mention to anyone, any agency or in any legal action that may be pursued in perpetuity. With reference to item 4 directly above, concerning confidentiality, should council or Brian Weir wish to pursue actions on these matters at some later date against the sources named as leakers in this matter, then they are at liberty to seek written permission from Peter Holstein or any other third party mentioned, to expose such disclosure. This clause is not negotiable and will be reviewed at a later date as discussed with KPMG. 18 On 4 April 2007 Mr Holstein met with Mr Gallo and Mr Robin Tarr of KPMG Forensic for some 10 hours during which he and the council executed a deed and he executed a statutory declaration, discussed above at [14]. The "third party", Mrs Hollis, did not attend. His statutory declaration, if accepted, would inculpate Councillor Stewart in the March and May 2006 disclosures and Mrs Hollis in the May and June 2006 disclosures. In summary, according to his statutory declaration: (a) on or about 29 March 2006, Councillor Stewart told Mr Holstein about the March 2006 information by telephone and faxed it to him, whereupon he posted it on the Forum website; (b) on or about 16 May 2006, Councillor Stewart told Mr Holstein about the May 2006 information by telephone and arranged to give it to Mrs Hollis who delivered it to him for copying, whereupon he posted it on the Forum website; (c) on 15 June 2006, Mrs Hollis told Mr Holstein about the June 2006 information by telephone, whereupon he posted it on the Forum website. Next day, she told him that Councillor Rose provided her with that information. That last statement is hearsay and inadmissible and I attach no weight to it.

[40]

Proceedings 6. Subject to clause 7, Council: 6.1 Agrees to refrain from joining Holstein to the Proceedings; and 6.2 Undertakes not to use the information obtained in the course of the Proceedings to commence or maintain defamation proceedings against Holstein. 6.3 Undertakes not to release information obtained in the course of the Proceedings to individuals who were the subject of potentially defamatory comment on the Forum for the purpose of defamation proceedings against Holstein unless Council is required to release the information by law. 7. If the information provided by Holstein in the Statutory Declaration is at a later date found to be false or is found not to be a complete record of what he saw and heard, including documentation he has seen or is in his possession, in relation to the categories of information requested by Council in Schedule 1 to this Deed, Council may institute proceedings against Holstein or join Holstein to the Proceedings. … Confidentiality … 11. Council will not, unless compelled to do so by law, at any time hereafter, divulge to any person or body the identity of Holstein as the maker of the Statutory Declaration, except where the disclosure is made to the Department of Local Government, the Independent Commission Against Corruption or any other similar statutory or State authority, the Land and Environment Court of NSW or if the disclosure is essential having regard to the principles of natural justice. 12. In the event of any proceedings ensuing in the Land and Environment Court in relation to facts or circumstances relevant to the subject matter of the Statutory Declaration, Council undertakes to apply for a suppression order in regard to the identity of Holstein as the maker of the Statutory Declaration. 21 Although Mr Holstein's statutory declaration was initially admitted only as a document produced between him and KPMG Forensic, it later came to be evidence of the truth of its contents. Initially Mr Holstein said in evidence that he had recanted the entire document. Subsequent questioning established that he did not by any means recant the entire document. On the contrary, Mr Holstein testified that he was reasonably confident that the information in it was correct when he made it and confirmed the accuracy of most of its contents. Some parts he corrected or qualified. He also indicated that he believed that parts of it were incorrect. He propounded a theory that the person who rang him to provide the March and May 2006 information might not have been Councillor Stewart but an impostor pretending to be her.

[46]

28 At the end of the second day of the trial (1 August 2007) there was discussion concerning when Mr Holstein would be called to give evidence. Councillor Stewart was present in court. Mr Holstein commenced giving evidence next morning. Just before Mr Holstein commenced to give evidence, Councillor Stewart's counsel made a point of openly asking her to leave the Court - which she did - as counsel for the council had indicated that otherwise comment might be made about her presence during his evidence. During Mr Holstein's cross-examination that day it came out that he had a telephone conversation with Councillor Stewart on the preceding night which he said was "about the Mayor's testimony and the stuff that had been during the day" and that he had probably received an SMS message or messages from her, but he did not speak to her at court on 2 August because he was under oath and had been told not to speak to her. His mobile phone was then called for and opened to reveal SMS messages to him from Councillor Stewart the previous night and the times and duration of telephone calls from her. It also revealed that he had stored her phone number on that mobile phone. The SMS messages and calls on 1 August were as follows: (a) at 7.39 pm Councillor Stewart sent the following SMS to Mr Holstein: " Ring home "; (b) at 7.40 pm Mr Holstein called Councillor Stewart on her private mobile number. The call lasted 23 seconds; (c) at 7.41 pm Mr Holstein telephoned Councillor Stewart's land line. The call lasted 16 minutes; (d) at 8.10 pm Councillor Stewart sent a second SMS to Mr Holstein stating: why call all councillors to be questioned on the dlg report something not right hope it is not a trap get a copy have a look put your thinging [sic] cap on come up with something; (e) at 8.19 pm Councillor Stewart sent a third SMS to Mr Holstein: They had nothing till you made a connection to councillors what do think were they up too (f) at 8.32 pm Mr Holstein called Councillor Stewart on her land line. The call lasted nearly nine minutes; (g) at 8.59 pm Mr Holstein called Councillor Stewart again on her land line. The call lasted 53 minutes and 35 seconds. 29 Although Councillor Stewart did not say anything about those conversations in her subsequent evidence in chief, her cross-examination revealed that she had read the transcript of Mr Holstein's evidence and confirmed that she had been in communication with him on the evening of 1 August 2007 and discussed his evidence. In cross-examination, Mr Holstein and Councillor Stewart claimed to have remarkably little recollection of what they talked about during those conversations. However, when it was put to Councillor Stewart in cross-examination that she never remonstrated with Mr Holstein for having said what he said about her (in his statutory declaration), she said that she did so on the night of 1 August 2007. In re-examination she claimed rather fulsomely that she told him that she was shocked that he had made those allegations and that she had not rung him and made any arrangements to fax or provide documents to use through another person; and that he said that he knew that. 30 The council submitted that the second and third SMS messages were not the communications of a truthful and honest person in the circumstances and were attempts to influence his evidence, and that her oral evidence in re-examination should not be accepted. The March 2006 leak 31 On 28 February 2006 Mr Weir wrote the following letter to the Mayor applying for re-appointment to the position of General Manager as his employment contract was due for renewal on 31 August 2006: In accordance with the provisions of Clause 4 of my Contract, I hereby formally seek reappointment to the position of General Manager of Shellharbour City Council.

[55]

33 On 24 March 2006, the General Manager wrote to the councillors to notify them of an extraordinary meeting on 29 March to consider his contract. Enclosed were a copy of the agenda and business papers, which included a confidential agenda and a minute from the Mayor, Councillor David Hamilton. The Mayor's minute recommended that the council offer Mr Weir a four-year contract and that the council and Mr Weir enter into negotiations in regard to the remuneration and other terms and conditions. Councillor Stewart admits that she received these documents. The business papers were marked to indicate that they were confidential under the provisions of s 10A(2) of the LG Act. The council followed its practice of printing business papers and minutes of closed meetings on yellow paper to signify their confidential nature. 34 The extraordinary meeting of council was held on Wednesday, 29 March 2006 from 5.45 pm until 6.35 pm. Those present were all councillors except Councillors Mifsud and Jeffreys, the Mayor's executive assistant Ms Flora MastroDomenico, and Mr Howe. Mr Weir attended part of the meeting, leaving at 5.50 pm and returning at 6.15 pm. The remuneration details in Mr Howe's letter of 16 March 2006 were not disclosed to the meeting. The council determined to resolve into a committee of the whole to consider the contract in closed session under s 10A(2)(a) of the LG Act. The committee resolved to recommend that the council offer Mr Weir a four year contract and that council and Mr Weir enter into negotiations in regard to remuneration and other terms and conditions over the next three months. The motion was carried by nine votes in favour. Councillors Stewart and Bailey abstained and were counted in the negative. Mr Weir was called in and consented to the committee's recommendations. Although not apparent from the minutes, Mr Weir's unchallenged evidence, which I accept, was that after the closed committee meeting concluded and the council returned to open session, the council resolved to make the offer and to enter into negotiations as the committee had recommended.

[72]

47 In his statutory declaration of 4 April 2007 Mr Holstein inculpated Councillor Stewart and Mrs Hollis in this leak as follows ("Third Party" refers to Mrs Hollis): 13. On or about 16th or 17th May 2006, I received a telephone call from Councillor Helen Stewart who advised me that draft copies of the DLG Report into the Shellharbour city council had been distributed to all of the Councillors by Mr Brian Weir, Shellharbour City Council's General Manager. Councillor Helen Stewart said that Brian had a briefing earlier that day and distributed the report. During this conversation Councillor Helen Stewart said that the draft document would be made available to me if I wanted a copy. I said yes. Councillor Helen Stewart said that she would give it to Third Party and I could copy it as long as I got it back straight away because the documents were identified to individual Councillors. We agreed that Third Party would deliver it to me. 14. About an hour later I met with Third Party at the Illawarra airport and I received the original document version of the draft DLG report from her. The distribution certificate on the front cover of this draft DLG report identified the recipient as Councillor Helen Stewart. Third Party and I then went to the Neighbourhood Community Centre and copied the document, except for the title page which identified Councillor Helen Stewart. 15. Third Party and I made two copies of the document. I retained one copy of the document, which I believe I still retain. Third Party retained the other copy, as well as the original version. I assume that Third Party returned the original version to Councillor Helen Stewart. Around about the same time I saw a news item on WIN television about the draft DLG report. The copy they had on TV appeared different to the one that I had as it seemed to still have the front title page on it. I do not know how the television station obtained their copy of the draft DLG report. 16. Subsequently, on dates around the 20th May 2006, I posted extracts from the draft DLG report onto the Ipaska website on numerous occasions.

[78]

53 In my view, the draft DLG Report received by Mr Holstein via Mrs Hollis came from Councillor Stewart. First, there were only 13 copies of the DLG report, one for each councillor. I accept the evidence of the councillors other than Councillor Stewart that they did not leak their copies. Secondly, I believe Mr Holstein's evidence that Councillor Stewart's name was on the bottom part of the front page of the document that he cut off. It was an aspect of his evidence on which he was repeatedly and convincingly firm. His evidence is consistent with independent, unchallenged evidence, which I accept, that each councillor's name was printed on the bottom part of the front page of each councillor's copy. The fact that he was led at one point in cross-examination into agreeing that he had said in his statutory declaration (contrary to the fact) that her name was written in biro was, at most, a defect in recollection on a matter of detail. Thirdly, it is unlikely that his good friend Mrs Hollis would not have told him that someone had given her the document during their meeting when they copied the document, or even subsequently. There is no suggestion that she did nor that he doubted for a moment that the source was Councillor Stewart until after his statutory declaration of 4 April 2007. Fourthly, I am doubtful, to say the least, about the reliability of the tea-stain evidence. If there was an occasion when the cat knocked over a cup of tea and stained a document in Councillor Stewart's study, given that she was not joined to the proceedings until March 2007 it is a remarkable feat of memory for both her husband and her to recall that it occurred on the night of 16 May 2006 and, in her case, to recall that the document was the draft DLG Report. She gave evidence that the tea was spilt on the draft DLG Report at about 9.30 pm. If that is so, it was late enough for the document in the meantime to have been given to Mrs Hollis to give to Mr Holstein, copied and returned. Indeed, if Councillor Stewart's draft DLG Report was tea-stained, as she alleged, it is conceivable that the stain could have been on that part of the front page of the document which Mr Holstein cut off. Her husband did not corroborate that the document he observed to be tea-stained was the draft DLG Report. I was not favourably impressed by their tea-stain evidence when it was tested in cross-examination.

[82]

(1) On 15 May 2006 Mrs Hollis' landline called Mr Holstein's mobile at 10.41.06 am for 22 seconds. (2) On 15 May 2006 Mrs Hollis' landline called Mr Holstein's mobile at 10.41.52 am for 32 minutes and 34 seconds. (3) On 15 May 2006 Mrs Hollis' landline called Mr Holstein's mobile at 1.52 pm for 3 seconds. (4) On 15 May 2006 Councillor Stewart's landline called Mrs Hollis' landline at 3.04 pm for one minute and 40 seconds. (5) On 15 May 2006 Mrs Hollis' mobile called Mr Holstein's mobile at 5.28 pm for eight minutes and ten seconds. (6) On 15 May 2006 Mrs Hollis' landline called Mr Holstein's mobile at 10.27 pm for 3 seconds. (7) On 16 May 2006 Mrs Hollis' landline called Councillor Stewart at 9.29 am for 16 minutes and 58 seconds. (8) On 16 May 2006 Mrs Hollis' landline called Mr Holstein's mobile at 10.55 am for three minutes and 33 seconds. (9) On 16 May 2006 Mrs Hollis' landline called Councillor Stewart's landline at 12.34 pm for 51 seconds. (10) On 16 May 2006 Mrs Hollis' landline called Mr Holstein's mobile at 12.46 pm for three minutes and 50 seconds. (11) On 16 May 2006 Councillor Stewart's mobile called Mrs Hollis' landline at 1.02 pm for 13 seconds. (12) On 16 May 2006 Mrs Hollis' landline called Councillor Stewart's mobile at 1.26 pm for nine seconds. (13) On 16 May 2006 Mrs Hollis' landline called Councillor Stewart's landline at 1.26 pm for 25 minutes and 34 seconds. (14) On 16 May 2006 Councillor Stewart's landline called Mrs Hollis' landline at 1.52 pm for 49 seconds. (15) On 16 May 2006 Mrs Hollis' landline called Councillor Stewart's landline at 2.23 pm for 11 minutes and 26 seconds. (16) On 16 May 2006 Mrs Hollis' landline called Councillor Stewart's landline at 3.01 pm for four minutes and 53 seconds. (17) On 16 May 2006 Mrs Hollis' mobile called Mr Holstein's mobile at 3.07 pm for three minutes and 36 seconds. (18) On 16 May 2006 Councillor Stewart's landline called Mrs Hollis' landline at 3.07 pm for 12 seconds. (19) On 16 May 2006 Councillor Stewart's landline called Mrs Hollis' landline at 3.09 pm for 52 seconds. (20) On 16 May 2006 Mrs Hollis' landline called Mr Holstein's landline at 3.11 pm for one minute and 49 seconds. (21) On 16 May 2006 Mrs Hollis' mobile called Mr Holstein's mobile at 3.12 pm for 59 seconds. (22) On 16 May 2006 Mrs Hollis' landline called Mr Holstein's mobile at 3.16 pm for four seconds. (23) On 16 May 2006 Mrs Hollis' mobile sent a text message to Mr Holstein's mobile at 3.18 pm. (24) On 16 May 2006 Mrs Hollis' mobile called Mr Holstein's mobile at 3.23 pm for two minutes and 40 seconds. (25) On 16 May 2006 Councillor Stewart's mobile called Mrs Hollis' mobile at 3.26 pm for 33 seconds. (26) On 16 May 2006 Mrs Hollis' mobile called Councillor Stewart's mobile at 3.26 pm on for seven seconds. (27) On 16 May 2006 Mrs Hollis' mobile called Councillor Stewart's mobile at 3.26 pm for six seconds. (28) On 16 May 2006 Councillor Stewart's mobile called Mrs Hollis' mobile at 3.27 pm for four minutes and 21 seconds. (29) On 16 May 2006 Mrs Hollis' mobile called Councillor Stewart's mobile at 3.27 pm for three minutes and 53 seconds. (30) On 16 May 2006 Mrs Hollis' landline called Mr Holstein's mobile at 3.37 pm for 12 minutes and 15 seconds. (31) On 16 May 2006 Councillor Stewart's mobile called Mrs Hollis' landline at 3.53 pm for 50 seconds. (32) On 16 May 2006 Mrs Hollis' mobile sent a text message to Mr Holstein's mobile at 3.56 pm. (33) On 16 May 2006 Mrs Hollis' landline called Councillor Stewart's mobile at 3.56 pm for one minute and six seconds. (34) On 16 May 2006 Councillor Stewart's mobile called Mrs Hollis' landline at 4.06 pm for 39 seconds. (35) On 16 May 2006 Mrs Hollis' landline called Mr Holstein's mobile at 4.23 pm for one minute and six seconds.

[87]

62 I do not accept his theory for the following reasons. First, as concluded earlier in these reasons, he received Councillor Stewart's copy of the draft DLG Report from Mrs Hollis later that night. It is unlikely, if not impossible, for anyone other than Councillor Stewart to have provided it to Mrs Hollis. I accept the evidence of the other councillors that they did not leak this information. Secondly, if it was not Councillor Stewart from whom his good friend Mrs Hollis received the draft DLG Report, it is likely that Mrs Hollis would have told him so during their meeting when they copied it, or even later. There is no suggestion that she did nor that he had the slightest doubt that it was Councillor Stewart to whom he spoke until after he made his statutory declaration on 4 April 2007. Thirdly, impersonating Councillor Stewart is an inherently unlikely thing for anyone to have done. Fourthly, Councillor Stewart said that she was unaware of anyone going around Shellharbour claiming to be her. Fifthly, Mr Holstein was familiar with Councillor Stewart's voice because, as he conceded, he had heard her speak on a number of occasions, including at a council meeting of 2 November 2005 which he attended when she spoke on a significant matter. Sixthly, according to the phone records in evidence, Councillor Stewart called Mr Holstein for the first time on 15 June 2006 at 9.33 am, then on 16 June 2006 at 10.59 am and then on 2 August 2007. In cross-examination Mr Holstein indicated that he may have been talking to her on these occasions about a charity race day, and conceded that he did not notice anything different in her voice on those occasions from the voice of the person who said she was Councillor Stewart and who had spoken to him on the night of 15 June 2006 to provide him with information. Seventhly, the records of telephone and SMS communications on the night of 16 May after the meeting show that Councillor Stewart and Mrs Hollis were in communication, as were Mrs Hollis and Mr Holstein. Eighthly, while there is no telephone record in evidence of a call by Councillor Stewart to Mr Holstein on the evening of 16 May, her private mobile phone records are not in evidence for the relevant time and the call could have been from that phone or from outside her home. Ninthly, as stated earlier, at a later point of his cross-examination he appeared to downplay the "different accent" explanation of his doubt that it was Councill Stewart to whom he spoke. 63 Finally, the SMS messages Councillor Stewart sent to Mr Holstein on 1 August 2007 said "why call all councillors to be questioned on the dlg report something not right hope it is not a trap get a copy have a look put your thinging [sic] cap on come up with something" and "they had nothing till you made a connection to councillors what do think were they up too": see [28] above. The suggestion appears to be that the council had no evidence against her until Mr Holstein made a connection to her. That statement applied to the other councillors as well, but her evidence indicates that it was her concerns in relation to her own position that led her to contact Mr Holstein both by SMS and by telephone on the night of 1 August. The matter which goes against her credit is the fact that both SMS addressed to Mr Holstein that night tend to suggest attempts by her to prevent him from inculpating her, as she knew his statutory declaration had done. In re-examination Councillor Stewart suggested that on the night of 1 August 2007 she remonstrated with Mr Holstein for having implicated her in the release of confidential information including the DLG Report. There may well have been strong words said but I am doubtful that the conversation was in the terms she claimed in re-examination or that it necessarily related to all the allegations against her.

[124]

91 Who was the author of the note and (if different) the source of the information in it? It was the council's case that before the 15 June 2006 meeting the remuneration figures were tightly held. They were in Mr Weir's letter. Only Councillor Hamilton appears to have had a copy of the letter. A council officer may have been shown the figures before the 15 June meeting in order to type them into a schedule to the agreement executed during the meeting, but that is not clear: the agreement is not in evidence. There was cross-examination as to whether Councillor Hamilton disclosed the figures during a caucus of Australian Labour Party councillors held prior to the 15 June meeting. There were eight ALP councillors. It appears that they tended to form two broad political alliances. One alliance comprised Councillors Hamilton (the Mayor), Hore, Bird and Gillette. The other comprised Councillors Greig (the Deputy Mayor), Briggs, Hawker and Leedham. Councillor Hamilton was cross-examined on the minutes of an ALP caucus prior to the 15 June meeting. The minutes were not tendered, although they were marked for identification as minutes of a meeting of 11 June 2006. There was some confusion in the evidence as to whether the caucus prior to the council meeting was on 11 or 15 June or on both dates. Some of the contents of the minutes of 11 June 2006 (marked for identification but not tendered) came to be in evidence because they were put to, and confirmed by, Councillor Hamilton. The minutes recorded a resolution that "council enter into a further contract with B Weir for a period of four years from 13 June 2006 until 15 June 2010 as per conditions and salary proposed by Mayor". In cross-examination, Councillor Hamilton denied relaying Mr Howe's proposed remuneration figures to the caucus and said that all he told the caucus was that he had been advised by Mr Howe that the remuneration should be mid-range. Councillor Hamilton was subsequently cross-examined further and again denied that he revealed the actual remuneration figures to the caucus. He indicated that what he told the caucus was that Mr Howe had come back with a mid-point figure and that they would go for a 4 percent increase over the next four years based on Mr Howe's figures and conditions. Other Labour councillors were cross-examined as to whether specific remuneration figures were discussed at a caucus prior to 15 June 2006 but they could not recall or their evidence was unclear as to whether or not they were discussed. If the actual remuneration figures were disclosed at the caucus on 11 June 2006, that might provide an explanation as to why Mr Holstein received a note written prior to the meeting of 15 June 2006 (Exhibit K) which set out those figures, either from someone at the caucus or from someone who obtained the information from someone at the caucus. However, the state of the evidence is such that I am unable to make any finding in that regard.

[135]

102 There are a number of difficulties with the case against Councillor Stewart in relation to the March 2006 leak. First, Mr Holstein's evidence in evidence was that he received the fax almost immediately after speaking on the telephone to the person whom he thought was Councillor Stewart. Yet the telephone records in evidence relating to her mobile phone and home land line show no telephone or fax communication between her home and Mr Holstein at the relevant time. The first communication from Councillor Stewart on those lines to Mr Holstein was not until 15 June 2006. However her private mobile telephone records are not in evidence. The person to whom Mr Holstein spoke must have had immediate access to a fax machine. Since the records in evidence do not show any fax communication from Councillor Stewart's home to Mr Holstein, if she sent the fax she must have done so and spoken to him by telephone outside her home. That is possible, but the absence of any communication from her home raises a doubt. Secondly, Mr Holstein testified that his recollection in paragraph 17 of his statutory declaration when he made it, must have been wrong because he did not have a fax machine at home. He did have a fax machine at work. However, as the council meeting ended at 6.35 pm and he ran a helicopter joy flight service, it was submitted for Councillor Stewart that he would not still have been at work when he received the fax. One cannot be sure of that but it has some weight and raises a doubt. Thirdly, Councillor Stewart denied it was her and I was unable to form any impression from her demeanour as to whether or not she was telling the truth. Fourthly, I am not assisted by the telephone communications between Councillor Stewart and Mrs Hollis and between Mrs Hollis and Mr Holstein. That is because there is no evidence to connect Mrs Hollis with this disclosure, any such connection is contrary to Mr Holstein's evidence, Mrs Hollis did not give evidence, and there was a prior history of numerous and regular telephone communications between Councillor Stewart and Mrs Hollis and between Mrs Hollis and Mr Holstein. It is not a reasonable inference to suggest that Mrs Hollis was a conduit between Councillor Stewart and Mr Holstein in relation to this incident simply because of their telephone communications. Indeed, the council's ultimate oral submission was that I would decide this part of the case on the basis of Councillor Stewart's direct involvement with Mr Holstein. Fifthly, while the specificity of paragraph 17 of Mr Holstein's statutory declaration is difficult to fathom if it is wrong, his departures in evidence from some aspects of his statutory declaration prompt me to be particularly cautious about its reliability generally where it is not otherwise supported. There is no firm evidentiary support for Mr Holstein's evidence, unlike the May 2006 leak where Councillor Stewart's own copy of the confidential document was handed over to Mr Holstein and tendered in the case.

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