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Re Lander.

Members:
RK Todd DP
Sir E Coates M
GD Grant M

Tribunal:
Administrative Appeals Tribunal

Decision date: Decision handed down 31 October 1985.

R.K. Todd (Deputy President), Sir E. Coates and G.D. Grant (Members)

This is an application for review of a decision refusing access, in whole or in part, to a number of documents access to which was sought by the applicant pursuant to the provisions of the Freedom of Information Act 1982 (``the FOI Act'').

2. The evidence before us and to which we have referred consists of the following:

  • (i) the oral evidence of the applicant;
  • (ii) the evidence of Robert James Tomkins, David Grant Lewis, Henry William Chandler, William Wright Reed and Joseph James Daly as set forth in their several affidavits and in the transcript of such of their evidence as was given orally;
  • (iii) the documentary evidence as set forth in the several documents tendered to the Tribunal and marked as exhibits.

3. The applicant had some minor disputes with the Australian Taxation Office (``ATO'') about deductions for home office expenses. In late 1979 or early 1980 a computer matching run by the ATO detected the apparent omission of building society interest from the applicant's tax returns. In May 1980 the ATO wrote asking the applicant to examine his records and to furnish within 21 days a statement of income from investments for the years ended 30 June 1977 to 1979 inclusive. The applicant replied stating that he had no records and asking the ATO to give him details of the information which it had. The ATO told him that it had information that he had a joint account with Irena Lander, his wife, in the Civic Co-operative Permanent Building Society which had been credited with $190 interest for the year ended 30 June 1978. The applicant was again asked to supply within 14 days the information previously requested, and to explain the reasons for any omission of income from his tax returns.

4. The applicant complained to the ombudsman, to the treasurer, and to senior officers of the ATO. The matter dragged on until 24 March 1981, when he and his wife were asked to go to the ATO for an interview. This did not take place until 9 October 1981. The applicant was in general terms apparently regarded as unco-operative: See the transcript of an interview between the applicant and officers of the ATO at exhibit 28.

5. In the meantime a full scale investigation was put in train and in due course amended

ATC 4676

assessments, which included in assessable income of the applicant profits from certain share transactions in relation to certain years of income, were issued for the years of income ended 30 June 1975 to 1980. The total of ``omitted income'' brought to assessment for the seven years was less than $3,000. The amount of additional tax was less than $1,500. Penalties, after remission, were a little over $1,000.

6. The applicant objected to the amended assessments, but his objections were disallowed. He requested a reference to a Board of Review. The hearing before the Board of Review took place on 20 May 1983 and 15 September 1983.

7. On 15 June 1983 the applicant addressed a request to the ATO under the FOI Act for access to ``all documents relative to my income tax affairs including all correspondence and all file notes submissions etc.''. On 17 August 1983 access was granted to approximately 1,000 documents subject to deletions in many cases. Access was refused to some 400 documents. The documents covered the years 1975 to 1982. Prior years had been destroyed.

8. On 19 August 1983 the applicant applied for internal review of the decision to refuse access. On such review some further documents were released, some with deletions. Otherwise the original decision was confirmed.

9. On 26 October 1983 the applicant made application to this tribunal for review of the decision on internal review. The decision was stated to be:

``Denial of access and deletions conveyed by attached copies of correspondence with ATO (with the exception of documents relating solely to Mrs I. Lander).''

10. In a decision given on 9 February 1984, the Board of Review confirmed the amended assessments and penalties. On 5 March 1984 the applicant lodged a notice of appeal to the Supreme Court of the A.C.T. from the decision of the Board of Review. In relation to the FOI application, an initial hearing of the matter by this tribunal was held over five days in July 1984 and was then adjourned to a date to be fixed for the purpose of lodgment of submissions by the applicant. This he did in August 1984, and in October 1984 the respondent filed submissions in reply. The presiding member of the tribunal having taken up another appointment, the tribunal was later reconstituted. In February 1985 the applicant advised the tribunal that the Supreme Court appeal had been disposed of without proceeding to a hearing. The tribunal communicated with the respondent and asked, in substance, whether the termination of the proceedings in the Supreme Court affected the claims of exemption. Initially the respondent did not seek to make any submissions, but the tribunal, faced with the problem generated by the effect of the cessation of the proceedings on claims of exemption based on sec. 37(1) of the FOI Act, listed the matter again for hearing on 3 May 1985. The respondent then realised the need for reassessment of the claims of exemption and the matter was again adjourned. At the further adjourned hearing on 6 June 1985 an amended schedule was presented, and while some claims of exemption were withdrawn, some that had previously been withdrawn at the original hearing were reinstated. We have attempted to encompass the difficulties caused by all this, but in the end result the tribunal must simply do its best to cope with the question whether the documents are exempt in whole or in part, fulfilling its review function as envisaged by sec. 58(1) of the FOI Act.

11. In addition, there were ultimately three concessions of exemption made by the applicant, namely in respect of names of other taxpayers shown on computer print-outs, in respect of computer codes, and in respect of documents claimed to be the subject of legal professional privilege. On computer codes the applicant said that if the code triggered a document, such as a letter, he would still desire access to that document. As to claims of legal professional privilege, the applicant at the hearing contested the validity of any such claim if the document represented a communication within the ATO involving what we may call an ``in-house'' legal officer.

12. Four particular claims of exemption may be dealt with under broad headings and disposed of at this stage. We shall not refer to them again, unless special reference is requisite, save by reference to the number of the Schedule that is set out at the end of these reasons and in which the documents, or portions of documents, that relate to the relevant Schedule heading are enumerated. The headings are as follows:

ATC 4677

  • (1) (Schedule 1) - Documents which include the names of officers of the ATO.
  • These are names of officers of the ATO, other than officers holding delegations from the Commissioner of Taxation, no claims of exemption being made in relation to the latter. The claims of exemption in relation to their names should clearly be upheld under sec. 40(1)(c), (d) and (e). In relation to sec. 40(2), disclosure of these names would not be in the public interest on any footing. It is unnecessary to say any more than that we adopt in their entirety the reasons in respect of this aspect of the matter given by the tribunal in Re Z and Australian Taxation Office (1984) 6 ALD 673 at p. 677 and in Re Mann and Australian Taxation Office (No. N84/76, 14 June 1985).
  • (2) (Schedule 2) - Documents which include the names of persons related to the applicant other than the wife of the applicant and information relating to the personal affairs of those persons.
  • We are entirely satisfied that these documents are exempt within sec. 41(1) of the Act on the footing that disclosure would constitute an unreasonable disclosure of the personal affairs of those persons, in the absence of their express consent to disclosure.
  • (3) (Schedule 3) - Documents giving names of persons identifiable as employees of organisations which supplied information on request to the ATO in relation to the applicant.
  • The claims under this head have given rise to some difficulty. The persons in question are officers of financial institutions. We shall call them ``outsider'' officers. Their employer would have been bound to supply the information in question to the ATO (see sec. 263 and 264 of the Income Tax Assessment Act 1936) but did so voluntarily. Morally speaking they are in a somewhat similar position to that occupied by officers of the ATO (Sch. 1). They should no more be exposed to the dangers of harassment and so on, however mild, than should ATO officers. But sec. 40 has no application outside the Australian Public Service. No claim of exemption was made under sec. 37(2)(b), but in our view it is clear enough that the entire document, in each instance in which the problem arises directly, should be regarded as an exempt document under sec. 37(2)(b) of the FOI Act on the footing that disclosure would, or could reasonably be expected to, disclose lawful methods or procedures for investigating breaches or evasions of the laws disclosure of which would, or would be reasonably likely to, prejudice the effectiveness of those methods or procedures. The fact that each has now been released to the applicant with the deletion only of the names in question is explicable as a release pursuant to sec. 14 and not as a concession in any way binding on the tribunal, even if that were possible, that the exempt character of the document has by such release been changed.
  • (4) (Schedule 4) - Documents claimed to be exempt pursuant to sec. 38 of the FOI Act.
  • The claims of exemption under sec. 38 are rejected for the reasons set out fully in the decisions of the tribunal in Re Z and Australian Taxation Office (1984) 6 ALD 673 and in Re Mann and Australian Taxation Office and most recently in Re Swiss Aluminium Australia Limited & Ors 85 ATC 4566.

13. We now discuss the documents, or portions thereof, still remaining in dispute. Where the documents are listed in Sch. 1-4 and are thus already dealt with in para. 12 above, we do no more than refer to the relevant Schedule:

  • (a) T9 pp. 7-10
    • Paragraphs 13-17 on p. 8.
    • Section 36. This document was entitled ``Objection Report'' and rehearsed a number of matters relating to the applicant's objections to the amended assessments. The remaining material in question sets out an account of an interview by an officer of the ATO with the local manager, one B, of a firm of stockbrokers in relation to share transactions of the applicant, profits in respect of which were included in the amended assessments, and in relation to a number of details of the source and application of funds to and from the stockbroker's account. In our view the document as a whole (subject possibly to

      ATC 4678

      a quite substantial question as to whether sec. 36(5) applied on the footing that part thereof consisted of purely factual material) was probably to be regarded as exempt under sec. 36. Such a claim was originally made, but was then abandoned at the hearing (transcript 310-311). It was then seemingly reinstated in final submissions, but simply by reinsertion of the claim in the amended schedule (exhibit 2B) without further argument being addressed. We do not consider that sec. 36 confers exemption on the material remaining in issue.
    • Section 37(1)(b). For this exemption to apply, it would have to be found that disclosure would, or could reasonably be expected to, ``disclose, or enable a person to ascertain, the existence or identity of a confidential source of information in relation to the enforcement or administration of the law''. The applicant clearly knows that there had been confidential discussions between the ATO and his own brokers (see para. 11 of the document). It is not in our view possible to characterize a person employed by the applicant to conduct as his agent an aspect of his financial affairs, and who is interviewed by the ATO in relation to the applicant's affairs, as a ``confidential source'' of the information in question. Nor for that matter would disclosure in the circumstances disclose, or enable the applicant to ascertain, the ``existence or identity'' of B, his own broker and agent. Exemption is thus not conferred by sec. 37(1)(b). It is accepted that this view means that a different conclusion would be reached had a stranger, and not the present applicant, applied for access. This is in our view a principled result, flowing from a proper concentration on the particular fact situation and the precise terms of a particular ground of exemption as expressed in the legislation. It does not gainsay that in general terms no applicant has a greater right to access under the Act than another. Another example would be a case where, under sec. 41(1), disclosure of personal affairs to one person would not be an ``unreasonable'' disclosure (see the discussion of T17 below) whereas disclosure to another would be unreasonable. Another example can occur under sec. 45 (see (iii) below).
    • Section 45. This document was prepared by an officer of the ATO, and although we have not, in the circumstances set out in (i) above, canvassed in detail the merits of a claim of exemption under sec. 36 generally, it is clear enough that this document is a document to the disclosure of which sec. 36(1)(a) applies. In consequence, sec. 45(2) would remove this document from the ambit of sec. 45(1). Even if this were not so, however, we are clearly of the view that disclosure to the present applicant would not constitute a breach of confidence. The applicant was within the confidence reposed by the broker in the ATO. No doubt the broker expected that the ATO would respect the confidential nature of the information about the applicant's affairs which he gave to the ATO, and it would constitute a breach of confidence were the ATO to supply the information in question to a third party. But it is another thing altogether to say that it was in any way a term of the confidential relationship between the broker and the ATO that it would be a breach of that relationship for the ATO, or the broker himself, to inform the applicant of what the broker had told the ATO about his, the applicant's, affairs as administered by the broker as his agent. Under the FOI Act problems often arise as to the supposed existence of legal rights and duties. They can arise in a situation in which no right or duty can be effectively asserted or denied, and in which any such assertion or denial of such right or duty as is made is not made inter partes before a court or tribunal apt to decide the matter, but rather in a vacuum. Given these difficulties, and making the best of it that we can, we are satisfied that we should find that the applicant was, in our opinion, within the confidence reposed by the broker in the ATO, and that disclosure would therefore not constitute a breach of confidence.

      ATC 4679

      Generally, the material here in question would clearly have been exempt prior to the disposal of the proceedings before the Board of Review and the Supreme Court under sec. 37(1)(a), which it is conceded does not now apply. No other grounds of exemption save those discussed above were relied upon. We therefore conclude that the paragraphs in question are not exempt documents. This consequentially covers also T11 pp. 19-22 (which is the same document as T9 pp. 7-10 save that it has added handwritten annotations) and T16 pp. 25-36 (the same though in handwriting with annotations), pp. 37-40 (which are identical), and pp. 41-44 (which are the same but again with annotations).
    • Page 10. Section 40(1). Schedule 1 exemption applies.
  • (b) T11 (the Supplementary Report) pp. 1-9
    • Page 2. Paragraphs 8(g) and 9(a) (name of relative): Schedule 2 exemption applies.
    • Pages 4 (part), 5 and 6. This material may be described as an ``in-depth'' version of what appeared on T9 pp. 7-10 discussed above, and includes an account of further interviews with other members of the firm of the applicant's stockbrokers. In our opinion, the material contained in these paragraphs is not exempt for the reasons set out above in relation to T9 pp. 7-10. We would only add the comment that even if sec. 36(1)(a) were considered to apply to this material there would not in our opinion be grounds for a claim that disclosure of it would be contrary to the public interest.
    • Pages 27-31. The documents here referred to are claimed to be wholly exempt under sec. 36. They constitute draft replies to the applicant by a Deputy Commissioner of Taxation. We consider that they fall clearly within the provisions of sec. 36(1)(a) and we are equally clearly of opinion that it would be contrary to the public interest for such drafts to be disclosed. We consider that to do so would be most likely to be productive of uncertainty and confusion and to be highly inimical to the due and proper carrying out of the deliberative processes of the public service. Disclosure of these documents would, in our opinion, be highly contrary to the public interest. We would only add the comment that we find it somewhat surprising that such drafts are retained on the file.
  • (c) T13
    • Pages 16-20. Schedules 1 and 3 exemptions apply.
    • Page 21. Schedules 1 and 3 exemptions apply.
    • Page 23. Schedules 1 and 3 exemptions apply. Reliance was also placed upon sec. 45 in this instance (as in fact it was also in respect of pp. 16-20 and 21) but in our opinion exemption would not be supported on this ground.
    • Page 24. This relates to material obtained by search of a public register. Section 12 would not seem to be applicable because this document is not itself a document that is open to public access. At the hearing only sec. 38 and 40(1)(c) were relied upon. These have been dealt with as broad claims and need not be further discussed. Reliance is now however placed by the respondent on sec. 41(1), but we are clearly of the opinion that a disclosure based on a search of a public record is not an unreasonable disclosure and this document is therefore in our opinion not exempt.
    • Page 25. Schedule 2 exemption applies. This document is wholly exempt under sec. 41(1), as it would constitute an unreasonable disclosure within the meaning of that provision.
    • Page 31. The claim of exemption in respect of this document was finally limited to a claim based upon sec. 37(2)(b). It being however no more than a copy of an ``enquiry authority'' directed to a bank we consider it to be a document of the most innocuous kind and not exempt under sec. 37(2)(b).
    • Page 32. Schedules 1 and 3 exemptions apply.
    • Page 33. Schedules 1 and 3 exemptions apply.

      ATC 4680

    • Page 34. Schedules 1 and 3 exemptions apply.
    • Pages 36-37, 45-47. Schedules 2 and 3 exemptions apply.
    • Pages 45-47. Schedules 1 and 2 exemptions apply, but note that p. 45 has been released in full.
    • Page 49. Schedule 3 exemption applies.
    • Page 50. Schedules 1 and 3 exemptions apply.
    • Page 55. See also as to T13 p. 31 above. Section 37(2)(b) does not confer an exemption as claimed because in our view the effectiveness of relevant methods or procedures within the meaning of that provision will not be prejudiced.
    • Pages 56, 57, 58, 59, 60, 61, 62, 63 and 65. Schedule 3 exemption applies.
    • Page 66. Schedules 1 and 2 exemptions apply.
    • Pages 67, 71, 72 and 84. Schedule 2 exemption applies.
    • Page 85. Schedule 3 exemption applies.
  • (d) T14
    • Pages 4-16. These are a set of ``stock'' questions prepared for the purpose of conducting an interview the product of which in answer form was ultimately contained in T9 pp. 7-10, which we have found not to be exempt. It does not follow however that a set of such questions should fall to be determined by the same considerations as those that are applicable to the product of an interview based upon such questions, which product did not appear in a question and answer form. Notwithstanding an apparent concession (see exhibit 2B), this material is in our opinion exempt under sec. 37(2)(b) as it would clearly prejudice the effectiveness of methods or procedures within the ambit of that provision.
    • Pages 17-21. This document concerns in our view no more than disclosure of the stockbrokers' business methods. Exemption was claimed under sec. 37(1)(b) and 45 but for reasons set out in para. 13(a)(ii) and (iii) above we are of the opinion that no question of disclosure of a confidential source of information or of breach of confidence is involved. We have already expressed the view that the applicant was privy to the confidence that was reposed, and if he was not in fact so, he is now entitled to be. A more significant question in relation to this material is perhaps that no exemption was claimed under sec. 43, and there is at least a major argument that were the question one of disclosure to the whole world rather than to the stockbrokers' client, such a claim may have been open. As it is not, but rather one of disclosure to the applicant only, the matter need not be pursued.
    • Page 25. This contains a small reference to B, the local manager of the stockbroking firm, and for the reasons already expressed is not in our opinion exempt.
  • (e) T15
    • Pages 1-3 and 4. Schedule 2 exemption applies.
    • Pages 5, 6 and 7. This item relates to a search of a public register and in our opinion disclosure of it involves no unreasonable disclosure of the personal affairs of a person having regard to the relevant matters being set out in a public register. The document is therefore not exempt.
    • Pages 8-14, 15-20, 21, 22-29, 30-43. Schedule 2 exemption applies.
  • (f) T16
    • Pages 1-3. This document is in fact a submission in relation to the affairs of another taxpayer, but contains assertions of law and was apparently referred to as a matter of convenience in the preparation of submissions in relation to the present applicant's case. The matter deleted from it and claimed to be exempt is clearly exempt as it would disclose the personal affairs of another taxpayer.
    • Pages 8-9. This document was described as a copy of a ``Summary of Our Current Assessing Policy'', which is an accurate description. It is a product of a course of procedure in the ATO whereby an attempt was made to co-ordinate

      ATC 4681

      assessing practice in the ATO in relation to bank trust accounts. In T16 p. 6, which was a letter to the Deputy Commissioner Canberra from a senior assistant Commissioner which has been released to the applicant, there is set out the concern of the writer to compare a number of submissions in relation to this matter. The submission contained in pp. 8 and 9 is followed by other draft submissions in pp. 10-12, 13-14 and 15. We consider that these documents are clearly part of a deliberative process falling within sec. 36(1)(a) and that it would be contrary to the public interest for such draft documents to be disclosed. If there is to be public disclosure of such a matter it should be contained in a manual prepared pursuant to the provisions of sec. 9 of the FOI Act.
    • Pages 25-36, 37-40 and 41-44. These fall into the same category as T9 pp. 7-10, and are therefore not exempt.
    • Pages 45-53. The matter remaining the subject of claims of exemption in these pages falls into two categories. The first relates to affairs of relations of the taxpayer (see para. 8(g) on p. 46 and para. 9(a) on the same page). These matters are exempt within sec. 41(1) (Sch. 2 applies). The other matter contained in pp. 48, 49 and 50 are a repetition of T11 pp. 4, 5 and 6 with which we have already dealt and the same result follows, that is to say these passages are not exempt. Precisely the same considerations apply to pp. 54-61 which are a repetition of pp. 45-53 but with a number of handwritten annotations.
    • Page 66. Schedule 3 exemption applies.
  • (g) T17
    • Pages 12 and 13. Schedule 3 exemption applies.
    • Page 14. These items contain the names of drawers of cheques which were paid into the applicant's bank account. They are names that would clearly be known to the applicant. The problem here is whether the question of ``unreasonableness'' of disclosure in sec. 41(1) enables a distinction to be drawn between disclosure to all persons on the one hand and to the applicant alone on the other. We are clearly of the opinion that such a distinction may, and in this case should, be drawn. It is clear that disclosure to the present applicant would not be unreasonable, since as already stated he would be well aware himself who the drawers would be. If access to these documents were sought by some person other than the applicant disclosure would prima facie be unreasonable.
    • Pages 57 and 99. Same as above, and therefore not exempt.
  • (h) T18
    • Page 56. This claim relates to the name of B, the local manager of the stockbroking firm. It is claimed to be exempt under sec. 37(1)(b) and 45, but for reasons already explained we consider that this document is not exempt under those provisions.
    • Page 70. Claims of exemption were maintained in respect of this item under sec. 37(1)(b) and 45, but in our opinion disclosure would neither disclose a confidential source of information nor would it constitute a breach of confidence. The document refers to a follow up of the interviews and communications with the local manager of the stockbroking firm.
    • Pages 71-73 and 74-75. In relation to these documents we again find that disclosure would not involve disclosure of a confidential source of information, nor would it constitute a breach of confidence.
  • (i) T19
    • Pages 16, 17 and 18. Schedule 1 exemption applies.
  • (j) T20
    • Pages 8-10. This is a draft reply prepared for submission to the treasurer and in our opinion is exempt within sec. 36. We have already expressed our view as to the exempt character of draft material of this kind (see para. 13(b) above) and we repeat our earlier comment that it is hard

      ATC 4682

      to know why such drafts were even retained on the file.
    • Page 22. The same considerations apply as above.
  • (k) T21
    • Pages 1-5. As in (j) above.
  • (l) T22
    • Pages 3-5. As in (j) above.
    • Pages 16-17. As in (j) above.
    • Page 19. This is a file note with respect to a draft reply from the treasurer and is likewise exempt as in (j) above.
    • Pages 65-66, 68 and 69-71. These documents relate to communications with the office of the Deputy Crown Solicitor and are clearly exempt under sec. 42(1).
    • Pages 73-75. Schedule 3 exemption applies.
    • Page 76. Schedules 2 and 3 exemptions apply.
    • Page 77. Schedule 3 exemption applies.
    • Page 79. Exemption was claimed here under sec. 37(1)(b) and 45. The document is an uncompleted summons to a witness to attend a Board of Review hearing. The witness attended but did not give evidence. Prior to the conclusion of the relevant proceedings in the Board of Review and before any Supreme Court hearing this document would have been exempt under sec. 37(1)(a), but given the completion of those proceedings exemption is no longer conferred. It is not in our opinion exempt under sec. 37(1)(b) or 45 as no confidential source of information would be disclosed and no breach of confidence would be involved.
    • Page 84. This document is a copy of a memorandum to the Deputy Crown Solicitor and is exempt under sec. 42(1).

14. In the result the decision of the tribunal is that the claims of exemption in respect of the documents listed in Sch. 5 to these reasons for decision are not upheld, and to that extent the decision under review is set aside. Otherwise the decision under review is affirmed. In view of the complexity of the matter we shall reserve liberty to apply in case any difficulty occurs in giving effect to our decision, but we nevertheless trust that resort to the tribunal will only occur in the case of serious difficulty emerging.

[ CCH Note: Schedules 1-5 are not reproduced.]


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