Case: Ainsworth v Criminal Justice Commission [1992] HCA 10 ; (1992) 175 CLR 564
Outcome: cited
Annetts v McCann [1990] HCA 57 ; (1990) 170 CLR 596, Mason CJ, Deane and McHugh JJ said (170 CLR at 598): 'It can now be taken as settled that, when a statute confers power upon a public official to destroy, defeat or prejudice a person's rights, interests or legitimate expectations, the rules of natural justice regulate the exercise of that power unless they are excluded by plain words of necessary intendment ...' In Ainsworth v Criminal Justice Commission [1992] HCA 10 ; (1992) 175 CLR 564 it was held that reputation, including business or commercial reputation, is an interest that may attract the protection of the rules of procedural fairness. In the present case it may be accepted that, at the time the decision was made, the Administrators had been identified as both targets and examinees. Thus, in a practical sense, a grant of the status of eligible applicant was a step towards an examination which was either inevitable or highly likely. In my opinion, that practical consequence does not mean that the difference between the stages explained in Re Excel 52 FCR 69 can be elided. In Ainsworth Mason CJ, Dawson, Toohey and Gaudron JJ said (175 CLR at 576): '... what is decisive is the nature of the power, not the character of the proceeding which attends its exercise.' Either the statutory power is subject to the obligation to afford prior notice or it is not. The circumstances of the particular application for exercise of the power do not affect the question as to whether the implied obligation has any operation in relation to the power in question. The decision to authorise the Evans did not itself directly adversely affect the interests of others in the manner required to bring the statutory presumption into play. Ainsworth [1992] HCA 10 ; 175 CLR 564 concerned publication of a damning report. The same can be said of Testro Bros Pty Ltd v Tait [1963] HCA 29 ; (1963) 109 CLR 353 that was effectively overruled by Annetts v McCann (per Mason CJ, Dean and McHugh JJ 170 CLR at 598) and Ainsworth (per Mason CJ, Dawson, Toohey and Gaudron JJ 175 CLR at 576 577). 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.