Victoria v Seal Rocks Victoria

6. The first matter in controversy is whether my task is to consider the claim for immunity de novo, as the State contended, or whether I am to proceed by way of review of the Arbitrator's determinations, as submitted on behalf of Seal Rocks, in order to conclude whether they were the result of error.

9. In support of their submission counsel for the first defendant, Seal Rocks Victoria (Australia) Pty Ltd ("Seal Rocks") relied upon the fact, accepted by the Court of Appeal, that the Arbitrator's determinations as to the public interest immunity claims were carried out at the request of the parties to the arbitration, including the State, and that he was required for the purposes of carrying out his arbitral functions to do so[3]. Seal Rocks also relied upon the use of the word "review" in paragraph 18 of the leading judgment of Ormiston JA on the appeal which I venture to set out in full.

"The short point is that a claim to public interest immunity, though ordinarily taken by the Crown, is not a conventional right capable of being waived at will. Nor is it the kind of claim which can itself be referred to arbitration, although there is no reason in the ordinary case why the arbitrator should not attempt to do what a court is required to do. But the resolution of such a claim is not the kind of incident to an arbitration which should be protected from review by this Court by reason of any general policy relating to the law of arbitration or to be implied from any statute relating to that subject. Naturally, if the Act had specifically dealt with the subject, one would have to comply with Parliament's express wishes, for it has the power to restate the relevant public policy. That, however, has not occurred."

It was put that this Court should review the Arbitrator's resolution of the claims and that it should and, indeed, could only do so by revisiting the reasoning and legal conclusions of the Arbitrator as if it were a conventional appeal. This would have the consequence that the review should proceed only upon the material before the Arbitrator and that, subject to certain qualifications, I should accept his findings of fact. It was submitted that the resolution of the claim to immunity may require me to undertake the task of determining in the case of a given document whether the public interest in the administration of justice which required its production outweighed the public interest in maintaining its confidentiality. In such an event, the acceptance of the Arbitrator's conclusions on this matter would relieve me of the burden of myself understanding the significance of the document to the resolution of the issues in the arbitration. In the present case, this burden would be considerable for the points of claim, points of defence and counterclaim and points of reply and defence to counterclaim occupy over 150 pages and the trial before the Arbitrator has already taken 105 days. Moreover, unlike the Arbitrator, who has an intimate knowledge of the issues and the evidence before him, I should be obliged to rely upon the argument of counsel to form a view upon the evidentiary and tactical significance of the documents in question. There is here a practical difficulty in the way of undertaking this task since counsel for Seal Rocks have no knowledge of their content.

14. In the present case the Arbitrator was empowered to deal with the immunity claims. Counsel for the State pointed out that, if my task were truly one of review of his decision, I should be limited to the evidence before him and to an examination of his reasoning in order to decide whether his determination should be set aside for error. If, on the other hand, the State had not been a party to the arbitration it would not in any view be bound by his determination; no question of waiver could arise. Nor could it be said in such a case that the question of immunity affecting the interests of the State had been referred by it for decision by him. Logic in these circumstances would dictate a re-hearing de novo in a proceeding to which the State was not a party. It would, they argued, be surprising if the nature of the review were to depend upon the question whether the State was a party to the arbitration.

17. I am unable to accept that my task is simply that of an appellate court determining whether the Arbitrator has fallen into appellable error. I do not construe the passage from the judgment of Ormiston JA set out above as requiring this to be done. It will be recalled that his Honour speaks of the jurisdiction of the Court to review the Arbitrator's resolution of the immunity claim. The Arbitrator has, in the circumstances which I have outlined in my March judgment, resolved the claims for immunity. In these circumstances, the task of the Court is to review this resolution. This says nothing as to the process of that review, whether it be by appeal or by some other process[4] including a fresh appraisal of the claim to immunity.

20. It is clear from the judgment of the Court of Appeal[5] that the judges see the jurisdiction of the Court to determine the issue of public interest immunity as a special one. It does not arise only upon a party or, even a non-party, making a claim for immunity; it concerns a right which is not, strictly speaking, capable of waiver. It remains part of the inherent jurisdiction of this Court notwithstanding that the State has agreed that some other tribunal may pass upon it. Where this has happened, the exercise of this inherent jurisdiction cannot be fettered by any inadequacy of the arguments presented to that tribunal or by any infirmities in the evidence before that tribunal. The issue at stake is of such a high order that this Court must itself form a view upon the immunity in the light of the material and argument before it.

23. I am not persuaded to adopt the contrary view notwithstanding the practical difficulties raised by counsel for Seal Rocks and which are demonstrated in this case. The judge approaching the task lacks a familiarity with the persons mentioned in the documents as authors, recipients or otherwise. This may make it difficult to determine whether the documents fall within the suggested class of immune documents. It is for that reason that the Court will lean heavily upon the oath of the person who has inspected them on behalf of the State and who asserts their classification. I do not suggest that such an oath is determinative of the issue, but the Court will place great weight on a clear and unequivocal assertion on oath by a responsible officer that the documents fall within the appropriate class for which immunity is claimed and not some general formulaic assertion[6].

26. There may also be difficulties, again illustrated in the argument in this case, in carrying out the process of balancing the public policy for Cabinet confidentiality against that for the administration of justice, should such process be appropriate. It is difficult for a judge who lacks familiarity with the issues and forensic detail of the arbitration to determine whether production of a given document is crucial to the proper determination of the arbitration[7]. In the present case the arbitration has run for 105 days; the case of Seal Rocks has closed subject to certain rights to re-open it. I do not know who have been the witnesses called nor can I speculate what legitimate forensic use might properly be made of any particular document, whether it be relevant to an issue or to credit, in the more restricted use of the concept of relevance which is applicable for the purpose of admissibility. Nor will I be able to overcome these difficulties with the assistance of counsel who are themselves familiar with these matters, for those acting for Seal Rocks have no knowledge of the documents other than the description. It may be, however, that this difficulty is more apparent than real given the limited circumstances in which the balancing process is to be undertaken.

29. I must, too, accept that a consequence of this analysis may be that, where a claim for immunity is made in an arbitration, its referral to the Court may cause an interruption to the arbitral process. This case presents an example of such interruption notwithstanding the expedited hearings which have been given by those responsible for listening. A further consequence is that it confers upon one party to an arbitration such as the present arbitration an advantage which may appear to be unfair or one-sided. Where, as in this case, an arbitrant raises a question of public interest immunity which is upheld by the Arbitrator, that is the end of the matter. Where the claim is rejected by the Arbitrator the party may raise it again, perhaps on different or supplemented material before the Court. Be that as it may, it is a feature of the special concern of the Court about the interests of the body politic.

33. The documents in question are contained in three lists. It is convenient that I identify them and the affidavit material provided in support of the claims. I should mention at the outset that, in each case, the claim for immunity is a class claim made in respect of Cabinet Documents which expression is defined in the lists to cover three categories of documents:

"(a) documents containing a record of communications or documents submitted to the Cabinet or a Cabinet Sub-Committee of the State of Victoria for the purpose of assisting in the deliberations of the Cabinet or a Cabinet Sub-Committee; (b) documents which are or contain a record of communications or documents which record or evidence the deliberations or decisions of Cabinet or a Cabinet Sub-Committee; (c) documents which are papers, communications or E mails brought into existence for the purpose of preparing submissions to Cabinet or a Cabinet Sub-Committee."

It was accepted before me that documents within this description fall within the group of Cabinet Documents as this expression is used in this area of law.

39. This comprises one document only, produced upon subpoena by the project monitor. The document and the affidavit of David Imam Ali sworn 21 November 2000 are described in paragraphs [4] to [5] of my March judgment.

43. For present purposes this list dated 22 December 2000 comprised 116 documents of which the Arbitrator directed production for inspection by Seal Rocks of 109 documents. The claim for immunity was supported before the Arbitrator by an affidavit of Barbara Ann Poland sworn 24 January 2001. These documents and the affidavit are described in paragraphs [7] to [8] of my March judgment.

47. This, the third, list dated 2 February 2001 comprised documents which are included in the December list, but which are now described more precisely, as well as some further documents. The claim was supported before the Arbitrator by a second affidavit of Ms Poland sworn 2 February 2001. These are likewise described in paragraphs [7] and [8] of my March judgment.

50. These lists and affidavits were placed before me by two affidavits of Stephen Joseph Lee, a solicitor acting on behalf of the State, sworn on 14 December 2000 and 14 February 2001 respectively. In these affidavits Mr Lee also exhibited a number of other documents including the pleadings before the Arbitrator and relevant extracts of the transcript of proceedings before the Arbitrator dealing with the arguments before him on the immunity claims as well as his determinations in respect of these claims.

53. In these documents the Arbitrator who has inspected the documents in question has made some observations about their content. Furthermore, as a person intimately familiar with the issues in the case he has expressed views as to their significance. I have had regard to his observations on these matters.

56. For completeness, I mention also the affidavit of Craig William Collins, solicitor for Seal Rocks, sworn 7 March 2001 which exhibited the Development and Concession Agreement dated 27 March 1997 made between the State and Seal Rocks as well as the amended notice of arbitration dated 27 October 2000. This, in summary, was the material before the Court in March 2001.

59. Since the decision of the Court of Appeal Ms Poland has sworn three further affidavits on 26 June 2001, 27 June 2001 and 5 July 2001 respectively. The last of these was prepared following my observation in the course of argument that it appeared that nowhere in all of the material was there an unequivocal statement on oath of a person who had inspected the documents that each of them fell within the definition of Cabinet Documents and into which of the categories of these documents it fell. It was filed by leave after the conclusion of oral argument. No party has availed itself of the liberty granted to make further submissions in the light of this affidavit.

62. As I have mentioned, the claims for immunity were presented as class claims for Cabinet Documents as defined. This means that the documents should be protected from inspection whatever be their content[8].

65. The documents included in the December list and in the February list were identified in the course of the State's discovery process in the arbitration. I proceed on the basis that, as discovered documents, they are relevant to those issues in the arbitration in the broad sense in which that expression is used for the purposes of discovery[9].

69. I shall start with the category (b) documents, for these present the least difficulty. The category is described as follows:

"(b) documents which are or contain a record of communications or documents which record or evidence the deliberations or decisions of Cabinet or a Cabinet Sub-Committee;

It is not easy to understand precisely what this convoluted sentence means and it was, perhaps, for this reason that Ms Poland, in paragraph 11 of her affidavit of 5 July, explains what she understands by it. She divides the category into two groups:

(i) official records of Cabinet meetings or minutes of Cabinet Committee Meetings; and (ii) communications or documents which disclose or reveal the decisions or deliberations of Cabinet but which are not part of the official records of Cabinet.

75. It is established by the highest authority that records of Cabinet deliberations are not to be disclosed[10]. This principle must be qualified in criminal cases and, it may be, in civil cases, where the deliberations are of historical interest only[11] or where they concern matters which are no longer current or controversial.[12] It has not been demonstrated that the circumstances in this proceeding give rise to this qualification if it be available for civil cases. I am satisfied, too, that the immunity extends to records of a Committee of Cabinet. I will, therefore, uphold the claim to immunity for documents properly falling within category (b)(i). The category (b)(ii) documents as so described are documents emanating from within the government which disclose or reveal Cabinet deliberations and decisions. The immunity extends to these documents also[13].

78. In her affidavit of 5 July Ms Poland identifies those documents which she says, following reinspection, fall within these two parts of category (b). I have looked at the description of the documents which she says are within category (b)(i). On their face they include, not only records or minutes, but also agenda papers of Cabinet. I am nevertheless content to proceed on the basis that the agenda would show the matters discussed in Cabinet or Cabinet Committee and should be protected for this reason. These are all documents from the February list; documents 4, 5, 6, 7, 8, 9, 10, 13, 15, 16, 17, 18, 24, 25, 26, 27, 28, 29, 30, 31, 33, 34, 35, 36, 43, 44, 47, 49, 52, 54, 56, 62, 63, 64 and 65. Of these documents, only documents 7, 9, 18, 31, 36, 44, 52 and 56 were the subject of the Arbitrator's determination adverse to the immunity claim. I will make declarations in favour of immunity with respect to all of these category (b)(i) documents.

81. The documents said by Ms Poland to fall within category (b)(ii) are December list documents 2, 3, 20, 63 and 84 and February list documents 37 and 50. Of these documents all but document 37 in the February list were ordered by the Arbitrator to be disclosed. I have not inspected them and nothing has been said of them which would cause me to doubt Ms Poland's description of their content. They, too, should not be disclosed.

85. The category (a) documents are one step removed from Cabinet deliberations. The category is described as follows:

"(a) documents containing a record of communications or documents submitted to the Cabinet or a Cabinet Sub-Committee of the State of Victoria for the purpose of assisting in the deliberations of the Cabinet or a Cabinet Sub-Committee."

Again, Ms Poland in her affidavit of 5 July helpfully explains what she understood this description to mean when she conducted her inspection of the documents. She says in paragraph 10 that the category (a) documents refer to "Cabinet submissions, addendums to Cabinet submissions and submissions to Cabinet Sub-Committees".

90. Following her reinspection, Ms Poland says that 45 documents fall into this category. From the December list, these are documents 18, 19, 22, 23, 24, 25, 53, 58, 59 64, 65, 66, 68, 69, 70, 98, 99 and 100; and from the February list, documents 1, 2, 3, 11, 12, 14, 19, 20, 21, 22, 32, 38, 39, 40, 41, 42, 45, 46, 47, 48, 51, 53, 55, 57, 59, 60 and 61. Of these documents the Arbitrator rejected the claims for immunity for all of the December list documents and, from the February list, documents 12, 22, 32, 39, 40, 51, 53 and 55. I suspect that Ms Poland may be in error in including document 47 from the February list because she elsewhere includes it in category (b)(i) and in any event its description suggests that it lies more appropriately in that category.

93. In The Commonwealth v Northern Land Council[14] the majority of the High Court included in the class of Cabinet documents "documents prepared outside Cabinet, such as reports or submissions, for the assistance of Cabinet". As with the actual record of Cabinet deliberations and decisions the immunity for this category of documents depends upon their tendency to disclose Cabinet deliberations. This is sometimes referred to as an indirect disclosure of the deliberations of Cabinet[15] because it is a fair inference that, where a document is submitted to Cabinet for its consideration, the content of the document was the subject of Cabinet's consideration[16]. As with the category (b) documents, I see no reason to doubt the categorisation of Ms Poland. Likewise, the topics dealt with may be taken to concern the Seal Rocks project and do not escape immunity on the basis that they do not concern matters of current controversy. These are documents which are, on the face of it, so closely connected with the processes of Cabinet that they are entitled to immunity. I am mindful also of the observation of Ipp J that the need for immunity of this category of documents is less compelling than that for the actual record of Cabinet deliberations[17]. Nonetheless, I see no reason why I should depart from the rule which requires immunity for them. The same may be said of those documents which were submitted to a Cabinet Sub-Committee. None of the category (a) documents should be produced.

97. The category (c) documents are one or more steps further removed from the deliberations of Cabinet. The category is described as follows:

"(c) documents which are papers, communications or E mails brought into existence for the purpose of preparing submissions to Cabinet or a Cabinet Sub-Committee."

Ms Poland again divides the documents in this category into two classes:

(ii) Other documents brought into existence for the purpose described.

104. The feature of these documents is that it does not appear without further evidence that they or their content were ever placed before Cabinet or were ever the subject of Cabinet deliberation or decision. An example of such further connecting material was given by Mr Ali's observation with respect to the sole document in the November list which is described as "Cabinet in Confidence Second Draft - 30 March 2000 - Submission Seal Rocks". Mr Ali says of this document that "It is substantially similar to but not exactly identical with, a submission which did go to Cabinet on 10 April 2000... Disclosure of the document would necessarily lead to the disclosure of the contents of that final submission". With respect to Mr Ali, were it not for his evidence, this consequence would not necessarily flow.

107. Ms Poland identifies 26 documents as being draft submissions to Cabinet or a Cabinet Sub-Committee. They are the November list document and, from the December list, documents 1, 5, 9, 13, 21, 30, 31, 33, 35, 41, 45, 51, 52, 54, 55, 60, 61, 67, 71, 76, 82, 83, 88, 96 and 97. All of these documents were the subject of an order by the Arbitrator for production.

110. Ms Poland identifies 62 documents as falling within the other class of category (c) documents. They are, from the December list, documents 4, 6, 7, 8, 10, 11, 12, 14, 15, 16, 26, 27, 28, 29, 32, 34, 36, 37, 38, 39, 40, 42, 43, 44, 46, 47, 48, 49, 50, 53, 56, 57, 62, 72, 73, 74, 75, 77, 78, 79, 80, 81, 85, 86, 87, 89, 90, 91, 92, 93, 94, 95, 101, 102, 103, 104, 105, 106, 107, 108 and 109. All of these documents were directed to be produced. She includes also document 58 from the February list which was not directed to be produced.

113. In Lanyon Pty Ltd v The Commonwealth[18] Menzies J referred to this category of documents as follows:

"[The basis for the immunity] is that the governmental process directed to obtaining a Cabinet decision upon a matter of policy and Cabinet's decision upon that matter should not, in the public interest, be disclosed by the production of Cabinet papers including what I would describe as papers which have been brought into existence within the governmental organisation for the purpose of preparing a submission to Cabinet. Such papers belong to a class of documents that, in my opinion, are of a nature that ought not to be examined by the Court, except, it may be, in very special circumstances."

It is apparent from this passage in the context in which it appears and from its subsequent consideration by the High Court that his Honour was concerned with the problem of indirect disclosure of Cabinet deliberations. I do not read his Honour's words as imposing immunity on a document solely because it came into existence for the purpose of preparing a submission to Cabinet. An example will demonstrate this. Suppose a minister wishing to place a proposal before Cabinet instructs the departmental secretary to prepare a submission. The secretary may direct a senior public servant to prepare a draft. For the purpose, a clerk is instructed to gather and analyse some statistics. The clerk does this and delivers it to their superior who decides not to include it in the submission. It could hardly be said that the clerk's analysis is entitled to immunity notwithstanding that the purpose for which it was brought into existence was solely that of being used for the preparation of a Cabinet submission. The question may be more difficult as the document in question comes closer to the actual Cabinet submission. In Egan v Chadwick[19] Spigelman CJ makes the point that the immunity of the document must depend upon assessment whether it reveals the deliberations or decisions of Cabinet.

"In order to avoid inconsistency between the power to call for documents and one of the bases on which it has been determined that the power is reasonably necessary (namely executive accountability derived from responsible government), the power should, at least, be restricted to documents which do not, directly or indirectly, reveal the deliberations of Cabinet".

119. With this in mind I turn to the two classes of category (c) documents. With respect to the draft submissions I note that Ms Poland not only describes the documents as such but also observes that their production would be injurious to the public interest. In paragraph 5 of her affidavit of 5 July she explains in some detail how this may be so. I will act upon her observation and I am confident that in expressing these views she has honestly formed the opinion which she states. I will not inspect or require production of that class of the category (c) documents.

122. The position with respect to the remainder of the category (c) documents is less clear. I have examined the description of them as they appear in the lists. It seems to me that it would be appropriate for me to examine the documents themselves in order to determine to what extent they are so close to the processes of Cabinet as to involve an indirect disclosure of these[20]. Accordingly, I called for production to me of those documents which are referred to in the second category mentioned in paragraph 12 of Ms Poland's affidavit of 5 July.

125. I have inspected these documents for the purpose of determining whether they are so close to Cabinet that they might disclose the subject matter of submissions presented for its consideration. I have concluded that all of them, except document 50 from the December list and document 58 from the February list, fall within this description. I am, of course, unable to say whether they would disclose these matters because I do not know what was the content of the material actually before Cabinet or that discussed at Cabinet. In any event, I am not concerned with content, but rather with the relationship between the documents in question as members of a class and the processes of Cabinet which are entitled to confidentiality.

128. I have not attempted to carry out any balancing exercise. I am mindful that, in a civil case at least, this is not an exercise to be undertaken as a matter of course. It has not been suggested that any of the documents is crucial to the conduct of the arbitration in the sense that the arbitration will be frustrated or its proper conduct prevented if the document were not produced. Indeed, given the fact that the arbitration is nearly complete, it would be difficult to suppose that this could be so. Nothing of an exceptional nature has been suggested, nor does this appear from the documents which I have seen. In the circumstances, any balancing exercise would be inappropriate.

131. I conclude, therefore, that document 50 from the December list and document 58 from the February list are not subject to public interest immunity on the ground that they are not Cabinet documents as defined. Otherwise I uphold the claims for immunity in respect of each of the category (c) documents on the ground that each of them is a Cabinet document as defined.

134. I will hear counsel further as to the orders which ought to be made to give effect to these conclusions.

[1] [2001] VSCA 94.

[2] [2001] VSC 76.

[3] [2001] VSCA 94 at [14].

[4] Cf Sankey v Whitlam (1978) 142 CLR 1 at 43, per Gibbs ACJ.

[6] Sankey v Whitlam (1978) 142 CLR 1 at 44 per Gibbs ACJ, at 96 per Mason J.

[7] The Commonwealth v Northern Land Council [1993] HCA 24; (1993) 176 CLR 604 at 619.

[8] The Commonwealth v Northern Land Council [1993] HCA 24; (1993) 176 CLR 604 at 616.

[9] See New South Wales v Ryan (1998) 101 LGERA 246 at 249-50.

[10] The Commonwealth v Northern Land Council [1993] HCA 24; (1993) 176 CLR 604 at 618.

[11] Sankey v Whitlam (1978) 142 CLR 1 at 42 per Gibbs ACJ.

[12] The Commonwealth v Northern Land Council [1993] HCA 24; (1993) 176 CLR 604 at 618.

[13] Lanyon Pty Ltd v The Commonwealth [1974] HCA 11; (1974) 129 CLR 650.

[14] [1993] HCA 24; (1993) 176 CLR 604 at 614.

[15] Commonwealth v CFMEU [2000] FCA 453; (2000) 98 FCR 31 at 39; Egan v Chadwick [1999] NSWCA 176; (1999) 46 NSWLR 563 at 576, per Spigelman CJ.

[16] New South Wales v Ryan (1998) 101 LGERA 246 at 252.

[17] Commonwealth of Australia v Arcadia Holdings Pty Ltd, unreported, FC (WA), 16 May 1997, BC 9702089 at pp. 5-6.

[18] [1974] HCA 11; (1974) 129 CLR 650 at 653.

[19] [1999] NSWCA 176; (1999) 46 NSWLR 563 at 576.

[20] The Commonwealth v Northern Land Council [1993] HCA 24; (1993) 176 CLR 604 at 617