Violi v Berrivale Orchards Limited

Federal Court of Australia|1994-12-01|Before: Branson J

INTRODUCTION 1 On Tuesday 6 June 2000 I gave orally an outline of my reasons for ruling that certain evidence was admissible in this proceeding. The evidence in issue includes recordings of conversations made without the consent of one of the parties to the conversations. I announced at that time that I would publish written reasons for the ruling in due course. These are my written reasons. 2 In the proceeding the applicants claim relief against the respondent for breach of contract and, or in the alternative, on the basis that the applicants have suffered loss or damage by unconscionable or misleading or deceptive conduct engaged in by the respondent (ss 51AA, 52, 82 and 87 of the Trade Practices Act 1974 (Cth)). The case of the applicants relies to a significant degree on conversations said to have occurred between the first applicant, Alec Mario Violi ("Mr Violi") and an employee of the respondent, Geoffrey Graeme Pumpa ("Mr Pumpa"). Some of the conversations relied upon by the applicants are admitted by the respondent to have occurred and some of the conversations are denied. As to most of the admitted conversations, there is a dispute as to the content of the conversations. 3 Two of the conversations relied upon by the applicants were recorded by Mr Violi. Mr Violi used a tape recorder in September 1995 to record a telephone conversation between himself and Mr Pumpa. Mr Violi also used a tape recorder in April 1996 to record conversation which took place at a meeting at which Mr Violi, Mr Pumpa and two other persons were present. In each case the recording took place in New South Wales. In neither case did Mr Pumpa consent to the use of the listening device. Mr Violi recorded each of the conversations with the purpose, should he consider it necessary, to publish the conversations, or a record of them, to persons who were not parties to the conversations should Mr Pumpa later "not tell the truth about what was happening" or should the respondent later deny the existence of a contract between the applicants and the respondent. Each of the conversations occurred after the date upon which the applicants allege that a contract was entered into between them and the respondent, and also after the dates of the alleged conduct and representations upon which the applicants rely for the purpose of their claims under ss 51AA and 52 of the Trade Practices Act 1974 (Cth). 4 Issues which arise in the circumstances include: (a) as to each of the recordings, whether it was made unlawfully; (b) as to any recording unlawfully made, whether evidence may be adduced from Mr Violi, whether as part of the applicants' case or in cross-examination, of the contents of the relevant conversation; (c) if Mr Violi is able to give evidence of the contents of a conversation which he recorded unlawfully is he limited to giving evidence from his recollection of the conversation unaided by recourse to the tape recordings or transcripts prepared from the tape recordings; (d) whether the tapes, or any of them, which record the respective conversations are admissible evidence in the proceeding; (e) whether transcripts prepared from the tapes are admissible evidence in the proceeding.

Telecommunications (Interception) Act 1979 (Cth) 5 The Telecommunications (Interception) Act 1979 (Cth) ("the Interception Act") by s 7(1) provides: "A person shall not: (a) intercept; (b) authorize, suffer or permit another person to intercept; or (c) do any act or thing that will enable him [or her] or another person to intercept; a communication passing over a telecommunication system." 6 Section 105(1) of the Interception Act provides that a person who contravenes s 7(1) of the Act is guilty of an offence. 7 The Interception Act is of relevance in the circumstances which I am required to consider only if Mr Violi recorded a communication passing over a telecommunications system "in its passage over the telecommunications system" (s 6). 8 As the recording made by Mr Violi of the telephone conversations between him and Mr Pumpa was apparently made by recording sound emitted from the telephone handpiece, it would appear that he did not record "a communication in its passage over [a] telecommunications system" within the meaning of the Interception Act. Rather he recorded a conversation after its passage over a telecommunication system. Nothing in the Interception Act discloses an intention to "cover the field" in the Constitutional sense so far as the recording of telephone conversations is concerned, as opposed to an intention to cover the field so far as telecommunication interception is concerned (cf Miller v Miller (1978) 141 CLR 269). For these reasons I give no further consideration to the Interception Act.

Listening Devices Act 1984 (NSW) 9 The question of the lawfulness or otherwise of Mr Violi's conduct in recording the two conversations thus depends upon the proper construction of the Listening Devices Act 1984 (NSW), ("the Listening Devices Act"). 10 Part 2 of the Listening Devices Act, consisting of ss 5-11, is concerned with offences relating to listening devices. Section 5, so far as is here relevant, provides: "5(1) A person shall not use, or cause to be used, a listening device - (a) to record or listen to a private conversation to which the person is not a party; or (b) to record a private conversation to which the person is a party. (2) … (3) Subsection (1)(b) does not apply to the use of a listening device by a party to a private conversation if - (a) all of the principal parties to the conversation consent, expressly or impliedly, to the listening device being so used; or (b) a principal party to the conversation consents to the listening device being so used and - (i) the recording of the conversation is reasonably necessary for the protection of the lawful interests of that principal party; or (ii) the recording of the conversation is not made for the purpose of communicating or publishing the conversation, or a report of the conversation, to persons who are not parties to the conversation. (4) …." 11 A tape recorder is a "listening device" within the meaning of the Listening Devices Act (s 3(1)). It seems plain, and neither party suggested to the contrary, that each of Messrs Violi and Pumpa was a "principal party" to the two recorded conversations, and that the two conversations were "private conversations" within the meaning of the Act (s 3(1)). 12 Part 3 of the Listening Devices Act, consisting of ss 12-14, is concerned with the admissibility of evidence. Within Part 3 - "a reference to the giving of evidence of a private conversation that has come to the knowledge of a person as a result of the use of a listening device includes a reference to the production of a record of such a private conversation" (s 12) 13 Section 13 of the Listening Devices Act, so far as is here relevant, provides: "13(1) Where a private conversation has come to the knowledge of a person as a result, direct or indirect, of the use of a listening device in contravention of section 5; (a) evidence of the conversation; and (b) evidence obtained as a direct consequence of the conversation so coming to the knowledge of that person, may not be given by that person in any civil or criminal proceedings. (2) Subsection (1) does not render any evidence inadmissible - (a) if all of the principal parties to the private conversation concerned consent to the evidence being given; (b) if the private conversation concerned comes to the knowledge of the person called to give the evidence otherwise than in the manner referred to in that subsection, notwithstanding that the person also obtained knowledge of the conversation in such a manner; (c) …; or (d) …." 14 I have not found the Listening Devices Act easy to construe. While it is plain that Mr Violi's conduct in recording the two conversations fell within the terms of s 5(1)(b) of the Act, the intended ambit of the conduct intended to be excluded by s 5(3)(b)(i) from the operation of s 5(3)(b) is not readily identified. 15 I conclude, because of the terms of s 5(1)(b) and (3)(a) of the Listening Devices Act, that a principal party to a conversation who intentionally uses, or causes to be used, a listening device to record that conversation is a person who "consents" to the listening device being so used within the meaning of s 5(3)(b) of the Act. 16 In considering the proper interpretation of subparagraph (i) of s 5(3)(b), it is necessary to bear in mind that s 5 creates an offence (s 10). There is a common law presumption that "mens rea, an evil intention, or knowledge of the wrongfulness of the act" is an essential ingredient of every offence; however, that presumption may be rebutted (He Kaw Teh v The Queen (1985) 157 CLR 523). In He Kaw Teh's case, Gibbs CJ at 529-530 noted that in considering whether the presumption has been rebutted regard is to be had to the words of the statute creating the offence, the subject matter with which the statute deals and whether strict liability will assist in the enforcement of the provision (see also the decision of the South Australian Court of Criminal Appeal in R v Scott (1996) 137 ALR 347). 17 I note that in Marsden v Amalgamated Television Services Pty Limited [2000] NSWSC 465 at para 14, Levine J accepted a submission that s 5(3)(b)(i) of the Listening Devices Act "requires that the question of whether something was reasonably necessary is to be determined objectively." At para 18 his Honour stated: "It seems to me that the proper construction of s 5(3)(b)(i) requires that at the time of the recording there exist the reasonable necessity for the protection of existing lawful interests. That construction is available from, and is in my view reinforced by, the language of subparagraph 1, which requires the recording of the conversation 'is' reasonably necessary." 18 I understand his Honour by the above passages to have indicated that s 5(3)(b)(i) is to be construed as establishing a wholly objective test. That is, a test which requires that the recording of the conversation be, in an objective sense, reasonably necessary for the protection of an actual lawful interest, existing at the time of the making of the recording, of the relevant principal party. 19 The contrast between the wording of s 5(3)(b)(i) of the Listening Devices Act and other provisions of the same Act provides support for the construction of the subparagraph adopted by Levine J. For example, s 6(1) of the Act provides: "A person shall not knowingly communicate or publish to any other person a private conversation …." (emphasis added) 20 Perhaps more importantly, s 7(2)(d) of the Act excludes from the prohibition on communication or publication otherwise imposed by s 7(1), the communication or publication of a record of a conversation made by the use of a listening device where the communication or publication - "is made to a person who has, or is, on reasonable grounds, by the person making the communication or publication, believed to have, such an interest in the private conversation as to make the communication or publication reasonable under the circumstances in which it is made." (emphasis added) 21 The mischief which is intended to be addressed by the Listening Devices Act is the protection of privacy. In moving the second reading of the Listening Devices Bill 1984, the then Attorney-General of New South Wales said: "The bill will establish safeguards against the unjustified invasion of privacy that can be occasioned by the use of electronic surveillance. In so doing, it seeks to protect one of the most important aspects of individual freedom - the right of people to enjoy their private lives free from interference by the State or by others. …. People should not be expected to live in the fear that every word that they speak may be transmitted or recorded and later repeated to the entire world." 22 I conclude that the subject matter of the Listening Devices Act is such as to suggest that the legislature might well have intended s 5 of the Act to be strictly construed. I further conclude that strict liability in respect of the offence created by s 5 may assist in the enforcement of the provision. 23 I am thus in respectful agreement with the view of s 5(3)(b)(i) of the Listening Devices Act taken, as I understand it, by Levine J in Marsden v Amalgamated Television Services Pty Limited. In my view, a person may only bring himself or herself within s 5(3)(b)(i) if - (a) he or she is a party to the private conversation; (b) a principal party to the conversation (who may be the person who uses, or causes to be used, the listening device) consents to the use of the listening device; and (c) the recording of the conversation is, as a matter of objective judgment, necessary for the protection of an actual lawful interest, existing as at the time of the conversation, of that principal party. 24 It is not necessary for me to decide, and I express no view on, the question of whether the defence that the accused acted under an honest and reasonable mistake as to the existence of facts which if true would have made his or her act innocent would be available to a person charged of an offence against s 5 of the Listening Devices Act (He Kaw Teh per Gibbs CJ at 533). Mr Violi in his evidence on the voire dire did not suggest that he had acted under any such mistake. For this reason it is also not necessary for me to give consideration to the significance, if any, of the defence (assuming it to be available) to the operation of Part 3 of the Act. 25 In the circumstances which I am required to consider, Mr Violi was both a party to a private conversation who used a listening device and a principal party to that conversation who consented to the use of the listening device. Section 5 of the Listening Devices Act will thus have no application to his conduct if the recording of the conversation was at the time of each of the conversations reasonably necessary for the protection of the "lawful interests" of Mr Violi. 26 The only "lawful interests" of Mr Violi that have been suggested in justification of his use of the listening device are his interests in the matters now pleaded in the statement of claim in this proceeding and denied by the defence. That is, the "lawful interests" sought to be relied upon are the very subject matter of this proceeding. 27 I am aware of no authority on the meaning of the expression "lawful interests" in s 5(3)(b)(i) of the Listening Devices Act. Perry J gave passing consideration to a comparable provision of the Listening Devices Act 1972 (SA) in R v Smith (unreported Supreme Court of South Australia, 1 December 1994). His Honour doubted that an interest in a general sense to obtain evidence to assist a criminal investigation would be sufficient to characterise the use of a listening device as a use "for the protection of the lawful interests" of the person using the listening device. However, his Honour was not required to reach a concluded decision on this issue. I have not found the Second Reading speeches or the Explanatory Note to the Listening Devices Bill, 1984 of assistance in this regard. 28 Unassisted by authority, it seems to me that "lawful interests" are to be distinguished from "legal interests". I do not consider that s 5(3)(b)(i) calls for a legal interest in the sense of a legal right, title, duty or liability. Rather I consider that "lawful interests" within the meaning of the paragraph are interests which are not unlawful. The expressions "legitimate interests" or "interests conforming to law", in my view, convey similar meanings to the intended meaning of "lawful interests" in the paragraph. 29 However, in determining what may constitute a persons "lawful interests" within the meaning of s 5(3)(b)(i), of the Listening Devices Act, it is necessary to consider the context in which the expression is used. That context includes Part 3 of the Act which is concerned with the admissibility of evidence in legal proceedings. 30 Section 13 of the Listening Devices Act creates a prima facie prohibition on the giving of evidence obtained by the use of a listening device in contravention of s 5 of the Act. This prima facie prohibition suggests strongly against an intention in the legislature to exclude from the operation of s 5(1) the recording of private conversations for the purpose of using the recording as evidence in proposed or pending legal proceedings - notwithstanding that the obtaining of reliable and probative evidence is ordinarily a lawful and proper thing to do. Nor, in my view, can the legislature have intended to make the question of whether s 13(1) of the Listening Devices Act prima facie renders evidence inadmissible in a legal proceeding depend upon an objective assessment of the merits of claims made in that legal proceeding. In the circumstances of this case, such an objective assessment would involve consideration of whether a contract was entered into between the applicants and the respondent and whether the respondent engaged in unconscionable or misleading or deceptive conduct in contravention of ss 51AA and 52 of the Trade Practices Act 1974 (Cth). A determination of these issues must necessarily await the completion of the hearing. 31 The decision apparently taken by the legislature not to include in the Listening Devices Act a provision equivalent to s 4(2)(a) of the now repealed Listening Devices Act 1969 (NSW) suggests against an intention that a person necessarily has a lawful interest in the recording of every conversation to which he or she is a party. Section 4 of the Listening Devices Act 1969 (NSW) provided, so far as is presently relevant: "4(1) A person is guilty of an offence against this Act if he uses a listening device to hear, record, or listen to a private conversation. (2) Subsection (1) does not apply - (a) where the person using the listening device is a party to the private conversation;

(b) …; or (c) …." 32 It is not necessary for me to attempt to determine exhaustively the types of circumstance in which the recording of a conversation by a principal party to the conversation "is reasonably necessary for the protection of the lawful interests of that principal party" within the meaning of s 5(3)(b)(i) of the Listening Devices Act. I am inclined, however, to think that the recording of a conversation intended by the parties involved to result in an oral contract in terms outlined during the conversation would be such a circumstance. I interpolate, that that is, of course, not this case as the alleged contract is pleaded to have been made before the date of the two conversations. Similarly, I am inclined to think that the recording by one party of a threatening telephone conversation or of a conversation forming part of a blackmail attempt would fall within the paragraph. However, such circumstances are far from the circumstances of this case. 33 Having regard to the context in which the expression "lawful interests" is found in s 5 of the Listening Devices Act, I conclude that the recording by Mr Violi of the two conversations was not reasonably necessary for the protection of his lawful interests within the meaning of s 5(3)(b) of the Listening Devices Act. It follows from this conclusion that Mr Violi used a listening device in the case of each of the two conversations in contravention of s 5 of the Act. 34 I turn to consider s 13 of the Listening Devices Act. For the reasons given in para 40 below, I do so to determine the status of the evidence sought to be adduced from Mr Violi under the law of New South Wales. Section 13 has no direct relevance, in my view, to the admissibility of evidence in the Federal Court of Australia. 35 The prohibition on the giving of evidence in legal proceedings contained in s 13(1) of the Act is drafted in terms of evidence of a conversation that "has come to the knowledge of a person as a result, direct or indirect, of the use of a listening device." Ordinarily, where a conversation is heard by a party to the conversation, and he or she also records the conversation and later listens to the recording, or reads a transcript of the recording, it may be doubted that the conversation is appropriately described as a conversation that has come to the knowledge of that party as a result of the recording. However, construing s 13(1) in the context of the Act as a whole, I conclude that, within the meaning of s 13(1), a conversation will have come to the knowledge of a person as a result, direct or indirect, of the use of a listening device if he or she has as any time obtained knowledge of that conversation as the result of a listening device. Mr Violi, although a party to the two conversations he recorded, is such a person as he has listened to the recordings and made transcripts from them. Section 13(1) would thus render prima facie inadmissible in legal proceedings evidence from Mr Violi of the conversations or evidence which Mr Violi obtained as a direct consequence of the conversations coming to his knowledge as a result of his use of the listening device. 36 However, I am of the view that s 13(2)(b) has the effect of reversing that prima facie inadmissibility. Although Mr Violi is, for the purpose of s 13(1) of the Act, a person to whom knowledge of the conversations has come as a result of the use of a listening device, knowledge of the conversation has also come to him otherwise than in the manner referred to in that subsection. Knowledge of the conversations came to Mr Violi when he participated in the conversations. Consequently s 13(2) has the effect that s 13(1) "does not render any evidence inadmissible". That is, s 13(1) does not render any evidence of the conversations that may be given by Mr Violi inadmissible; nor does it render inadmissible from Mr Violi any evidence obtained as a direct consequence of the conversations coming to his knowledge as a result of the use of the listening device. The intent of the legislature would appear to be that where a person would ordinarily be able to give evidence of a conversation otherwise than because of the use of a listening device (eg. from his or her recollection as a party to the conversation) the fact that he or she has obtained knowledge of the conversation as a result of the use of a listening device should not render his or her evidence inadmissible. Moreover, it would appear from the opening words of s 13(2) to be the intent of the legislature that in such a circumstance the best evidence of the conversation, and not merely the witnesses (presumably imperfect) recollection of it, should be available to the court. 37 The evidence sought to be adduced from Mr Violi includes, in addition to evidence of his recollection of the conversations, evidence which establishes the provenance of the tapes on which the conversations are recorded and evidence intended to establish the accuracy of transcripts prepared from the recordings. The wording of s 13(1) is not entirely apt to reach to actual recordings of conversations and transcripts prepared from such recordings. As Mason CJ, Brennan and Deane JJ pointed out in Butera v Director of Public Prosecutions for the State of Victoria (1987) 164 CLR 180 at 184: "… a conversation can be proved by the oral testimony of anyone who heard it but that is not the only means by which a conversation may be proved. The courts have now accepted tape recordings as evidence of the conversations or other sounds recorded on the tape …. A tape recording may be used to produce a form of evidence which is different from both oral testimony and documentary evidence." (citations omitted) 38 I note incidentally that the concerns expressed by their Honours at 186 and 188 as to the admissibility of a transcript of a recording, and as to the use that may properly be made of a transcript, would now seem to be overtaken, at least in this Court, by s 48(1) of the Evidence Act 1995 (Cth) ("the Evidence Act") (see, however, Eastman v The Queen (1997) 76 FCR 9 at 112-113). 39 It is plain that the purpose of s 13(1) would be significantly undermined if the subsection were not construed as reaching to actual recordings and transcripts prepared from such recordings. I conclude that s 13(1) is to be construed as reaching to recordings of conversations and to transcripts prepared from such recordings. It may perhaps best be regarded as doing so by the indirect means of rendering inadmissible evidence of the circumstances in which the recordings were made - on the basis that such evidence was itself obtained "as a direct consequence of the conversations so coming to the knowledge [of the witness]" within the meaning of s 13(1)(b) of the Listening Devices Act. 40 However, as is mentioned above, I do not regard s 13 of the Listening Devices Act as having any direct relevance to the admissibility of evidence in this Court. The admissibility of evidence in this Court is not a subject matter within the competence of the Parliament of New South Wales (Pedersen v Young (1964) 110 CLR 162 at 167). It is thus necessary for consideration to be given to relevant Commonwealth legislation.

The Evidence Act 1995 (Cth) 41 Section 79 of the Judiciary Act 1903 (Cth) provides: "79. The laws of each State and Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising federal jurisdiction in the State or Territory in all cases in which they are applicable." 42 This proceeding is being heard in the exercise of federal jurisdiction in the State of New South Wales. In the absence of any relevant provision in the Constitution, the question arises of whether any law of the Commonwealth provides that s 13 of the Listening Devices Act is not binding on this Court. In my view, s 138 of the Evidence Act is to be construed as so providing. 43 Section 138 of the Evidence Act so far as is here relevant, provides: "138 (1) Evidence that was obtained: (a) improperly or in contravention of an Australian law; or (b) in consequence of an impropriety or of a contravention of an Australian law; is not to be admitted unless the desirability of admitting the evidence outweighs the undesirability of admitting evidence that has been obtained in the way in which the evidence was obtained; (2) …. (3) Without limiting the matters that the court may take into account under subsection (1), it is to take into account: (a) the probative value of the evidence; and (b) the importance of the evidence in the proceeding; and (c) the nature of the relevant offence, cause of action or defence and the nature of the subject-matter of the proceeding; and (d) the gravity of the impropriety or contravention; and (e) whether the impropriety or contravention was deliberate or reckless; and (f) whether the impropriety or contravention was contrary to or inconsistent with a right of a person recognised by the International Covenant on Civil and Political Rights; and (g) whether any other proceeding (whether or not in a court) has been or is likely to be taken in relation to the impropriety or contravention; and (h) the difficulty (if any) of obtaining the evidence without impropriety or contravention of an Australian law." 44 The Dictionary of the Evidence Act defines an "Australian law" as a law of the Commonwealth, a State or a Territory. The Listening Devices Act is an "Australian Law" within the meaning of the Evidence Act. 45 The evident intent of s 138 of the Evidence Act is to render inadmissible evidence of the kind identified in paragraphs (a) and (b) of s 138(1) unless a court has formed the view that the desirability of admitting the evidence outweighs the undesirability in the relevant circumstances of admitting the evidence. This intent is inconsistent with the intended operation of s 13 of the Listening Devices Act. For this reason I conclude that s 79 of the Judiciary Act 1903 (Cth) does not have the effect of making s 13 of the Listening Devices Act binding on this Court. 46 As I announced on 6 June 2000, I have concluded that the desirability of admitting the evidence of Mr Violi of and concerning the two conversations outweighs the undesirability of admitting the evidence obtained by him in contravention of s 5 of the Listening Devices Act. I reached this conclusion after taking into account each of the matters specified in s 138(3) of the Evidence Act and also the additional matter that, in my view, s 13(1) of the Listening Devices Act would not have the effect of rendering inadmissible in a New South Wales court the evidence of Mr Violi of and concerning the two conversations. The fact that neither party opposed the giving of the evidence was a matter which, in my view, was entitled to little weight in the circumstance that the consent of all parties to the private conversations to the giving of the evidence had not been obtained. Sections 138 of the Evidence Act and s 13(1) of the Listening Devices Act are concerned with issues of wide public concern which extend beyond the interests of parties to particular litigation. 47 It was for the above reasons that I ruled on 6 June 2000 that the evidence could be adduced from Mr Violi, both in his examination in chief and in cross-examination, as to the contents of the two conversations which were recorded by him, that the evidence which he could give was not limited to his recollection of the conversations unaided by recourse to the tape recordings or transcripts prepared from the transcripts, and that the tape recordings of the conversations were themselves admissible in evidence, as were the transcripts prepared from such recordings.

I certify that the preceding forty-seven (47) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Branson J.

Associate: Dated: 14 June 2000 Counsel for the Applicant: Mr P. Taylor with Mr D. Stack

Solicitor for the Applicant: Sean McNally, Solicitor

Counsel for the Respondent: Mr R.J. Weber and Ms Mountfort

Listening Devices Act 1984(NSW)ss 5

Telecommunications (Interception) Act 1979(Cth)s 7(1)

Trade Practices Act 1974(Cth)

Listening Devices Act 1972(SA)

Listening Devices Act 1969(NSW)

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