Case: Johns v Australian Securities Commission [1993] HCA 56 ; (1993) 178 CLR 408
Outcome: discussed
example, relied upon by the Administrators, was the decision of the High Court in Johns v Australian Securities Commission [1993] HCA 56 ; (1993) 178 CLR 408. Dawson J (178 CLR at 437) expressly referred to personal reputation as being a sufficient interest to require observance of the rules of natural justice concerning a decision by the predecessor of ASIC to release confidential transcripts to a Royal Commission and consent to the use of them in public hearings. McHugh J used words to the same effect (178 CLR at 470 471) and Brennan J was impliedly to the same effect (178 CLR at 430). Gaudron J agreed with Brennan J. Dawson J referred to another factor in the following words (178 CLR at 437): '... the publication of the information provided by the appellant under compulsion was a further encroachment upon the appellant's common law right to maintain his silence upon the matters which were the subject of investigation by the A.S.C.' It is submitted on behalf of the Administrators that the conduct of the examinations that are proposed is likely to prejudice their private and commercial and business reputation. It is a reasonable assumption that the examinations will be held in public and that the topics to be explored will involve airing allegations which would be detrimental to the reputation of the Administrators. It is also likely that there will be some media publicity as to those allegations. It is also submitted that the common law right to maintain silence will be encroached upon. It is not clear to me that the so called common law right to silence is a right or interest in the sense outlined in Annetts v McCann [1990] HCA 57 ; 170 CLR 596 . The only authority that was cited to support that proposition, apart from the reference in the passage from the reasons of Dawson J in Johns v Australian Securities Commission 178 CLR at 437, was that of Branson J in Re Cortaus Ltd (in liq); Sheahan v Joye (No 2) (1996) 20 ACSR 576 at 578. That was an examination of the balance of convenience on an application for a contested adjournment and did not involve the present issue. There is merit in the submission by counsel for ASIC that it is hardly correct to say that an officer of a company that is in external administration has any right to silence concerning the affairs of the company. On the contrary, the officer is bound by statute, when called upon, to provide information. That has been the case for a very long time ( Rees v Kratzmann [1965] HCA 49 ; 114 CLR 63; Evans v Wainter 145 FCR per Lander J at [44] [82]; per French J in Highstoke Pty Ltd v Hayes Knight GTO Pty Ltd [2007] FCA 13 at [46] [78]). Johns v Australian Securities Commission [1993] HCA 56 ; 178 CLR 408 deals with a different statutory setting. The issue of substance before the High Court concerned the validity of decisions on the part of the Australian Securities Commission (ASC) to release transcripts of private examinations of Johns by the ASC to a Royal Commission in circumstances which allowed the information released to be published generally (see 178 CLR at 421). The Australian Securities Commission Act 1989 (Cth) provided for the examination of persons on oath as ancillary to an investigation by the ASC. Such an examination was to take place in private (s 19). As Brennan J said, in delivering the principal judgment, (178 CLR at 422): 'The Act thus maintains the traditional privacy of examinations into the affairs of a company. Privacy has been observed in conducting such examinations out of consideration for the commercial reputation of the company and the protection of witnesses.' Of course his Honour was not speaking of examinations pursuant to Pt 5 of the Corporations Act in relation to which public examination is now the norm. His Honour was of the view that confidentiality of the information contained in the transcripts of examination was amenable to protection by Johns by injunction where its use or disclosure was not authorised by statute (178 CLR at 427). That being the case, it was not a long step to hold that the statute implicitly provided that Johns was entitled to prior notice of any decision to affect his statutory right to confidentiality in the information in particular existing transcripts by authorising the release of those transcripts on a basis that would destroy that confidentiality. For the sake of completeness I should deal with two arguments raised on behalf of ASIC, each of which I would reject if I had been of a different view concerning the duty to accord natural justice. The first was that the decision here was a step or stage in a process, the end result of which would entail procedural fairness ( Ainsworth per Mason CJ, Dawson, Toohey and Gaudron JJ 175 CLR at 578; South Australia v O'Shea [1987] HCA 39 ; (1987) 163 CLR 378 per Mason CJ at 389). It was argued that the position was not dissimilar to the lack of any requirement to afford a hearing prior to the commencement of a prosecution of a like proceeding ( Barton v The Queen [1980] HCA 48 ; (1980) 147 CLR 75 at 95; Cornall v AB (A Solicitor) [1995] 1 VR 372 at 396 397; Commissioner of Police v Reid 16 NSWLR at 461; Australian Securities and Investments Commission v Plymin (No 3) [2002] VSC 358 ; (2002) 170 FLR 128 at 135 136). In the first place, it is doubtful whether there is a single decision making process of the kind referred to in the present circumstances. The decision by ASIC in relation to authorisation involves different questions and different issues than would a decision to issue a summons by the Court or the conduct of the proceeding itself (cf McHugh J in Johns v Australian Securities Commission 178 CLR at 473 474 and see Re Excel 52 FCR at 83 84 and 86). It is difficult to see how failure to accord natural justice in relation to the decision in question could be cured by later events. In the second place, the examination procedure is not designed to accord natural justice to a party in relation to any allegations made, directly or indirectly, against the examinee. The process is inquisitorial rather than adversarial. There is no case put against the examinee or any case in reply. As Windeyer J said in Rees v Kratzmann (114 CLR at 80): 'The honest conduct of the affairs of companies is a matter of great public concern to-day. If the legislature thinks that in this field the public interest overcomes some of the common law's traditional consideration for the individual, then effect must be given to the statute which embodies this policy.' (See also Hamilton v Oades [1989] HCA 21 ; (1989) 166 CLR 486.) The fact that the Court maintains considerable control over the examination does not change the information gathering nature of the function being performed. The analogy with the institution of Court proceedings is not apt.