The Daniels Corporation International PTY LTD & anor APPELLANTS
v Australian Competition and Consumer Commission RESPONDENT

Judges: GLEESON CJ, GAUDRON, GUMMOW, HAYNE JJ
McHUGH JJ
KIRBY JJ

CALLINAN JJ

Subject References:
Evidence
Legal professional privilege
Statutory notice to produce documents
Whether statute abrogated legal professional privilege
Trade practices
Notice to produce documents to Australian Competition and Consumer Commission
Commission investigating whether Trade Practices Act 1974 (Cth) contravened
Whether documents to be produced included those for which legal professional privilege claimed

Legislative References:
Trade Practices Act 1974 - 155

Judgment date: 7 November 2002

Canberra

Judgment by:
CALLINAN JJ

118. A Full Federal Court ^[F199] (Wilcox, Moore and Lindgren JJ) held that the second appellant is not entitled to refuse to comply with notices issued by the respondent in reliance upon s 155 of the Trade Practices Act 1974 (Cth) ("the Act") requiring the production of documents in respect of which the first appellant claimed legal professional privilege. The question that this appeal raises is whether that holding was correct. The same question arose for determination in the matters of Woolworths Ltd v Fels and Coles Myer Ltd v Fels ^[F200] in which Gaudron J stated a case for the determination of the Full Court of this Court. No question arises in these matters whether the relevant documents are in fact covered by legal professional privilege if a claim of entitlement to it were not abrogated by the Act.

The reasoning of the Full Court of the Federal Court

119. Wilcox J referred first to Pyneboard Pty Ltd v Trade Practices Commission ^[F201] , a unanimous decision of this Court that a person may not refuse to comply with a notice under s 155 of the Act on the ground that the material sought might lead to exposure to a penalty. There were, in that case however, as his Honour pointed out, some differences in approach by the five Justices who constituted the Court. His Honour then turned his attention to Baker v Campbell ^[F202] . There, the question was whether the production of documents which would ordinarily be subject to legal professional privilege, could be compelled, pursuant to s 10 of the Crimes Act 1914 (Cth). The Court (Murphy, Wilson, Deane and Dawson JJ, Gibbs CJ, Mason and Brennan JJ dissenting) held that the doctrine of legal professional privilege was not confined to judicial and quasi-judicial proceedings and that it could be claimed with respect to documents referred to in a search warrant issued under the Crimes Act.

120. In his discussion of Baker v Campbell, his Honour quoted statements from the judgments of Wilson, Deane and Murphy JJ which emphasized the importance of legal professional privilege, and the necessity for indications of strong intendment to the contrary for its abrogation ^[F203] .

121. In Baker v Campbell, Wilson J, for example, said ^[F204] :

"The multiplicity and complexity of the demands which the modern state makes upon its citizens underlines the continued relevance of the privilege to the public interest. The adequate protection according to law of the privacy and liberty of the individual is an essential mark of a free society and unless abrogated or abridged by statute the common law privilege attaching to the relationship of solicitor and client is an important element in that protection."

122. And Deane J made these observations ^[F205] :

"It is a settled rule of construction that general provisions of a statute should only be read as abrogating common law principles or rights to the extent made necessary by express words or necessary intendment. As has been seen, the underlying principle that a person should be entitled to preserve the confidentiality of relevant communications between himself and his attorney is regarded as of such importance by the common law that the courts themselves do not require disclosure of the content of such communications even if it appears that such disclosure would be conducive to justice in a particular case and even if the proceedings be between parties neither of whom is entitled to claim the protection of the privilege as regards the relevant documents or information. Both logic and authority support the present-day acceptance of the preservation of that confidentiality as a fundamental and general principle of the common law. It is to be presumed that if the Parliament intended to authorize the impairment or destruction of that confidentiality by administrative action it would frame the relevant statutory mandate in express and unambiguous terms."

123. His Honour's next step was to consider the reasoning of this Court in Corporate Affairs Commission (NSW) v Yuill ^[F206] .

124. Wilcox J concluded that the decision in Pyneboard effectively governed this case: that "capable", as used in s 155 of the Act effectively refers to physical capacity, what a person is unable to do, not what a person is entitled not to do. The holder of a document has the ability to comply with a demand for production. Conduct that involves a contravention of the Act often comprises many separate acts, some of which may be done by lawyers. Without information about contacts between the person under investigation and that person's lawyer, it may be impossible for the ACCC to see the whole picture. A third consideration, his Honour said, was that the recipient of a notice may not be in a position to make a reliable assessment of the status or relevance of a particular document or documents and a solicitor recipient may not know enough about the client's actions and affairs to realise that those matters of which he or she is aware, and which may seem innocent enough, are part of a course of conduct that, considered overall, is criminal or fraudulent ^[F207] .

125. In his reasons for judgment Moore J adopted a similar approach to Wilcox J. His conclusions were stated in this way ^[F208] :

"First, the language of s 155(5) is, in my opinion, emphatic and requires compliance with a notice if the recipient is capable of complying with it. That appears to have been the view of Mason ACJ and Wilson and Dawson JJ in Pyneboard and also of Brennan J who described it ^[F209] as 'a statutory provision, clear and absolute in its terms'. A person is capable of complying with a notice even if to do so is in derogation of a common law right, whether it is a right the person enjoys or the person asserts on behalf of another (as a solicitor does in relation to the client's legal professional privilege)."

126. His Honour continued ^[F210] :

"[T]he attainment of the purpose for which the power is conferred by s 155 may be hampered by treating the obligation imposed by s 155(5) as subject to claims of legal professional privilege. Documents or information relevant to the inquiry might be denied to the person undertaking it. As was made clear by the High Court in Pyneboard, a claim of privilege on the ground of self-incrimination would substantially fetter an investigation and stultify the statutory purpose for which s 155 was enacted."

127. Lindgren J expressed his general agreement with the reasons of Wilcox and Moore JJ.

The appeal to this Court

128. Before turning to s 155 of the Act, reference should be made to, for example, ss 151BUF, 159 and 161 of it. Section 151BUF refers to the giving of a report under the record keeping rules by "[a]n individual"; s 159 to a person giving evidence before the ACCC, and, as will appear s 155 itself, in sub-ss (2A) and (7) refers to the recipient of a notice issued pursuant to it. Section 161 refers to a witness before the Australian Competition Tribunal. The significance of these sections is that they all abrogate, in express terms, the principle of the right to avoid self-incrimination. Their presence strongly implies that if what has been long regarded as a matter of fundamental principle is intended to be overridden, then the legislature, conscious of the need to do so in express terms, would have done so, especially in the same enactment, with respect to s 155.

129. It is necessary to set out the text of the section: " 155 Power to obtain information, documents and evidence

(1)

Subject to subsection (2A), if the Commission, the Chairperson or the Deputy Chairperson has reason to believe that a person is capable of furnishing information, producing documents or giving evidence relating to a matter that constitutes, or may constitute, a contravention of this Act, or is relevant to a designated telecommunications matter (as defined by subsection (9)) or is relevant to the making of a decision by the Commission under subsection 93(3) or (3A), a member of the Commission may, by notice in writing served on that person, require that person:

(a)

to furnish to the Commission, by writing signed by that person or, in the case of a body corporate, by a competent officer of the body corporate, within the time and in the manner specified in the notice, any such information;

(b)

to produce to the Commission, or to a person specified in the notice acting on its behalf, in accordance with the notice, any such documents; or

(c)

to appear before the Commission at a time and place specified in the notice to give any such evidence, either orally or in writing, and produce any such documents.

(2)

Subject to subsection (2A), if the Commission, the Chairperson or the Deputy Chairperson has reason to believe that a person has engaged or is engaging in conduct that constitutes, or may constitute, a contravention of this Act, Part 20 of the Telecommunications Act 1997 or Part 9 of the Telecommunications (Consumer Protection and Service Standards) Act 1999, a member of the Commission may, for the purpose of ascertaining by the examination of documents in the possession or control of the person whether the person has engaged or is engaging in that conduct, authorize, by writing signed by the member, a member of the staff assisting the Commission (in this section referred to as an authorized officer) to enter any premises, and to inspect any documents in the possession or under the control of the person and make copies of, or take extracts from, those documents.

(2A)

A member of the Commission may not give a notice under subsection (1) or an authorisation under subsection (2) merely because:

(a)

a person has refused or failed to comply with a notice under subsection 32(1) of the Prices Surveillance Act 1983 on the ground that complying with the notice would tend to incriminate the person, or to expose the person to a penalty; or

(b)

a person has refused or failed to answer a question that the person was required to answer by the member presiding at an inquiry under that Act, on the ground that the answer would tend to incriminate the person, or to expose the person to a penalty; or

(c)

a person has refused or failed to produce a document referred to in a summons under subsection 34(2) of that Act, on the ground that production of the document would tend to incriminate the person, or to expose the person to a penalty.

(3)

The Commission may require the evidence referred to in paragraph (1)(c) to be given on oath or affirmation and for that purpose any member of the Commission may administer an oath or affirmation.

(4)

Where:

(a)

particulars of an agreement were furnished to the Commissioner of Trade Practices under section 42 of the Restrictive Trade Practices Act 1971 or of that Act as amended; or

(b)

particulars of an agreement were furnished to the Commissioner of Trade Practices under section 42 of the Trade Practices Act 1965 or of that Act as amended, being particulars that would have been required to be furnished under section 42 of the Restrictive Trade Practices Act 1971 if that Act had been in force when they were furnished;

and it appears to a member of the Commission that the agreement would, if still in force:

(c)

constitute a contract, arrangement or understanding to which section 45 of this Act applies; or

(d)

provide for the engaging in conduct that is prohibited by this Act;

the member of the Commission may, by notice in writing served on a person who appeared from those particulars to be a party to the agreement, require that person to inform the Commission, by writing signed by that person or, in the case of a body corporate, by a competent officer of the body corporate, within the time and in the manner specified in the notice, whether any action was taken by the parties to the agreement to terminate the agreement and, if so, the nature and full particulars of that action.

(5)

A person shall not:

(a)

refuse or fail to comply with a notice under this section to the extent that the person is capable of complying with it;

(b)

in purported compliance with such a notice, knowingly furnish information or give evidence that is false or misleading; or

(c)

obstruct or hinder an authorized officer acting in pursuance of subsection (2).

(6)

The occupier or person in charge of any premises that an authorized officer enters in pursuance of subsection (2) shall provide the authorized officer with all reasonable facilities and assistance for the effective exercise of his or her powers under that subsection.

(6A)

A person who contravenes subsection (5) or (6) is guilty of an offence punishable on conviction:

(a)

in the case of a person not being a body corporate - by a fine not exceeding $2,000 or imprisonment for 12 months; or

(b)

in the case of a person being a body corporate - by a fine not exceeding $10,000.

(7)

A person is not excused from furnishing information or producing or permitting the inspection of a document in pursuance of this section on the ground that the information or document may tend to incriminate the person, but the answer by a person to any question asked in a notice under this section or the furnishing by a person of any information in pursuance of such a notice, or any document produced in pursuance of such a notice or made available to an authorized officer for inspection, is not admissible in evidence against the person:

(a)

in the case of a person not being a body corporate - in any criminal proceedings other than proceedings under this section; or

(b)

in the case of a body corporate - in any criminal proceedings other than proceedings under this Act.

(7A)

This section does not require a person:

(a)

to give information or evidence that would disclose the contents of a document prepared for the purposes of a meeting of the Cabinet of a State or Territory; or

(b)

to produce or permit inspection of a document prepared for the purposes of a meeting of the Cabinet of a State or Territory; or

(c)

to give information or evidence, or to produce or permit inspection of a document, that would disclose the deliberations of the Cabinet of a State or Territory.

(8)

Nothing in this section implies that notices may not be served under this section and section 155A in relation to the same conduct.

(9)

A reference in this section to a designated telecommunications matter is a reference to the performance of a function, or the exercise of a power, conferred on the Commission by or under:

(a)

the Telecommunications Act 1997; or

(b)

the Telecommunications (Consumer Protection and Service Standards) Act 1999; or

(c)

Part XIB or XIC of this Act."

130. Some preliminary observations may be made about the section. The powers exercisable under it require for their invocation the relatively low threshold of "reason to believe". A notice may be addressed to, and require production of documents by a person, whether that person has or has not engaged in contravening conduct. Power to enter premises is conferred. Sub-section (7A) exempts from production Cabinet documents of a State or Territory apparently whether they would attract public interest immunity or not. By contrast however with sub-s (2A) and sub-s (7), sub-s (5) says nothing about the abridgment of fundamental rights of any kind, whether relating to self-incrimination, legal professional privilege or otherwise.

131. I do not doubt, as submitted by the appellants, that this case, although it depends of course as does any case in which a power is exercisable under an enactment, upon the terms of the enactment, is sufficiently close, in statutory language, and general principle to Baker v Campbell as to be substantially governed by the reasoning in that case.

132. These principles relevantly emerge from Baker v Campbell. Legal professional privilege is a common law right of fundamental importance. A statute should only be read as abrogating fundamental common law rights to the extent necessary by express words or necessary intendment ^[F211] . If the Parliament intended to authorize the impairment, or destruction, of legal professional privilege by administrative action, it should frame the relevant statutory mandate in express and unambiguous terms ^[F212] . There was nothing in s 10 of the Crimes Act 1914 (Cth) or in any other provision of the Crimes Act to indicate either that the Parliament directed its attention to the modification or destruction of the confidentiality of relevant communications between a person and his or her legal advisers, or that there existed a legislative intention to modify the common law principle that the confidentiality of such communications should be preserved ^[F213] . The fact that the question whether s 10 of the Crimes Act abrogated the privilege first fell to be authoritatively determined so long after its enactment, was an indication of the measure of acceptance of the view that the power which the section confers in general terms did not extend to documents to which legal professional privilege attaches ^[F214] . According to ordinary principles of construction, the section was to be construed as not including in the documents which it authorized to be inspected or seized, those the confidentiality of which would be protected in the courts by the doctrine of legal professional privilege.

133. Here, as with the Crimes Act 1914 (Cth), the Act is relevantly silent as to legal professional privilege. For abrogation to occur it would be necessary to imply it. Legal professional privilege does not have an unconfined operation. It protects only such documents as have come into existence for the dominant purpose of obtaining, or giving legal advice, or for use in litigation. Its ambit and operation by no means confine the considerable investigative powers that s 155 of the Act confers. A successful claim of legal professional privilege will almost always obstruct or restrict in some way access to materials that might be of utility to a party or a party's cause, be it criminal or civil. The common law has long understood this elementary proposition to be so. It has, however, for other powerful reasons, which remain good, been prepared to accept that some criminals may escape conviction and investigations may be sometimes hampered by reason of the availability of a claim of legal professional privilege.

134. Baker v Campbell, decided after Pyneboard, is not, of course, the only recent relevant authority. In Coco v The Queen ^[F215] also, this Court repeated that it will not construe a statute as abrogating a fundamental common law right unless the Parliament makes its intention to do so unambiguously clear. There, the Court found that general words in an enactment will rarely be sufficient for that purpose if they do not specifically deal with the question. In their joint judgment, Mason CJ, Brennan, Gaudron and McHugh JJ referred to the speech of Browne-Wilkinson LJ in Wheeler v Leicester City Council ^[F216] , who explained that the presence of general words in a statute will generally be insufficient to authorize interference with the basic immunities which are the foundation of our freedom, that to constitute such authorization, express words are required ^[F217] . Their Honours referred to the opinion of Browne-Wilkinson LJ in these terms ^[F218] :

"The insistence on express authorization of an abrogation or curtailment of a fundamental right, freedom or immunity must be understood as a requirement for some manifestation or indication that the legislature has not only directed its attention to the question of the abrogation or curtailment of such basic rights, freedoms or immunities but has also determined upon abrogation or curtailment of them. The courts should not impute to the legislature an intention to interfere with fundamental rights. Such an intention must be clearly manifested by unmistakable and unambiguous language. General words will rarely be sufficient for that purpose if they do not specifically deal with the question because, in the context in which they appear, they will often be ambiguous on the aspect of interference with fundamental rights ^[F219] .

...

The need for a clear expression of an unmistakable and unambiguous intention does not exclude the possibility that the presumption against statutory interference with fundamental rights may be displaced by implication. Sometimes it is said that a presumption about legislative intention can be displaced only by necessary implication but that statement does little more than emphasize that the test is a very stringent one ^[F220] . As we remarked earlier, in some circumstances the presumption may be displaced by an implication if it is necessary to prevent the statutory provisions from becoming inoperative or meaningless. However, it would be very rare for general words in a statute to be rendered inoperative or meaningless if no implication of interference with fundamental rights were made, as general words will almost always be able to be given some operation, even if that operation is limited in scope."

135. Very recently, the House of Lords in R (Morgan Grenfell & Co Ltd) v Special Commissioner of Income Tax ^[F221] reached a similar conclusion with respect to the issue of a notice under the Taxes Management Act 1970 (UK) pursuant to a section which was silent with respect to legal professional privilege. Whilst it is true that the outcome of that case depended in part at least upon the application of the Human Rights Act 1998 (UK), there are several statements in the leading speech of Lord Hoffmann which emphasize the fundamental importance of legal professional privilege ^[F222] .

136. In this appeal the Court was pressed by the respondent with the argument that access to relevant documents for the purpose of establishing liability was of critical importance. Lord Hoffmann dealt with a similar argument in Morgan Grenfell in this way ^[F223] :

"The revenue say that it is important for them to have access to the taxpayer's legal advice in those cases in which liability may turn upon the purpose with which he entered into a transaction or series of transactions. This is particularly true of some of the anti-avoidance provisions. But there are many situations in both civil and criminal law in which liability depends upon the state of mind with which something was done. Apart from the exceptional case in which it appears that the client obtained legal advice for the purpose of enabling himself better to commit a crime ^[F224] this is not thought a sufficient reason for overriding [legal professional privilege]."

137. The Full Court of the Federal Court was influenced by the words "or otherwise" in a passage from the joint judgment of Mason ACJ, Wilson and Dawson JJ in Pyneboard ^[F225] .

"The comments made by Kitto and Walsh JJ in Mortimer [v Brown ^[F226] ] are apposite to s 155. Sub-section (1) confers a power on the Commission to require the provision of information, the production of documents or the giving of evidence relating to contravention, or possible contravention, of the Act. It is significant that sub-s (5) makes it an offence for a person to refuse or fail to comply with a notice under sub-s (1) 'to the extent that the person is capable of complying with it' for these words in themselves are quite inconsistent with the existence of a privilege entitling the recipient of a notice to refuse to comply, whether on the ground that compliance might involve self-incrimination or otherwise. Moreover, it is apparent that the purpose of conferring the power and imposing the obligation is to enable the Commission to ascertain whether any contravention of the Act has taken place, or is taking place, and to make the information furnished, the documents produced and the evidence given admissible in proceedings in respect of contravention of the Act, a purpose which would be defeated if privilege were available. As in Mortimer ^[F227] the comment may be made that the provision is valueless if the obligation to comply is subject to privilege. Without obtaining information, documents and evidence from those who participate in contraventions of the provisions of Pt IV of the Act the Commission would find it virtually impossible to establish the existence of those contraventions. The consequence would be that the provisions of Pt IV could not be enforced by successful proceedings for a civil penalty under s 76(1)."

138. I am unable, as Wilcox J did, to read the words "or otherwise" as extending to legal professional privilege. If that were intended I would have expected their Honours to say so in terms, conscious as they must have been, in the circumstances of Pyneboard, of the desirability of express language in this area of the law. Furthermore, in reading their decision, it is important to keep in mind the assumption that their Honours were prepared to make in that case, which rendered it unnecessary to explore the differences between the different privileges.

139. Their Honours said ^[F228] :

"As will appear, this case is susceptible of determination on other grounds. For this reason we are content to assume, without deciding, that the privilege against exposure to conviction for a crime and the privilege against exposure to a civil penalty is available to a corporation in Australia."

140. The ratio of Pyneboard is, in any event, no more than that the privilege, if it existed, would frustrate (as opposed to merely hamper) the operation of the relevant provision, a consequence which would not, as I have pointed out, follow here.

141. In Baker v Campbell reference was made to the long acceptance of the availability of the relevant privilege there. It is not without significance here that the general practice and stated policy of the respondent for many years after the commencement of the operation of the Act, was that a claim of legal professional privilege was a valid reason for refusing to answer questions or produce documents in response to a notice under s 155 ^[F229] . Both in the Commission's published guidelines and in other published statements by senior management, the Commission had maintained that one reason for its policy of refraining from pressing for documents or information declined on the ground of legal professional privilege, was that such documents or information were unlikely to assist investigations in any event ^[F230] . The ACCC has since published a new guideline concerning s 155 of the Act ^[F231] .

142. The respondent relied on Corporate Affairs Commission (NSW) v Yuill ^[F232] . That case is distinguishable. It was the fact, and the majority there was impressed by it, that the Act under consideration, the Companies (New South Wales) Code made specific reference to legal professional privilege in two sections, 299 and 308. There are no equivalent provisions in the Act. It is unnecessary therefore for me to embark upon the rather formidable task of attempting to reconcile the reasoning of six judges in Coco with that of the majority of three judges ^[F233] in Yuill.

143. There is one other matter which I should mention. The respondent submits that it is of significance in two respects that the present context is one of an administrative or executive inquiry: first that s 122 of the Evidence Act 1995 (Cth) preserves legal professional privilege in relation to the adducing of evidence if the disclosure be made under compulsion of law; and, secondly an inference of exclusion of privilege is to be less readily drawn in cases in which the obligation to answer questions and produce documents is an aspect of an examination on oath before a judicial officer. Neither of these matters, in my opinion, dictates a different conclusion from the one that I have reached. Creatures of the Executive of which this respondent is one are increasingly being armed with broader and more intrusive powers. That they are of these kinds requires, if anything, that the true and permissible ambit of the intrusion be carefully scrutinized and not be extended unnecessarily or in the teeth of unabridged (by legislation) fundamental, longstanding rights. It must be kept in mind that all that the majority says in Pyneboard ^[F234] is that the relevant inference of the existence of an obligation to respond will less readily, not that it invariably will not be, drawn in the case of an examination before a judicial officer.

144. It follows that the appeal should be allowed with costs. The respondent should also pay the appellants' costs in the Full Court of the Federal Court.