Case: Wilhelm v McKay [2007] FCA 367
Outcome: discussed
Wilhelm v McKay [2007] FCA 367 , Greenwood J refused an application to join a party to an application for an order to review certain decisions relating to the application for a search warrant under the Crimes Act . The party sought to be joined was the person who decided to apply for the search warrant. The circumstances, at least at that level of generality, appear to be the same as those applicable to the decision of the fifth "respondent" (and of the AFP and the DCT, as alleged in paras 9.8 and 9.9 of the amended application). His Honour decided that the decision to swear the affidavit in support of the application for the search warrant and to apply for it were not decisions of an administrative character made under an enactment: see s 3(1) of the ADJR Act. Counsel for Mr Nicholls did contend that the decision was plainly wrong and should not be followed: see eg Bank of Western Australia Ltd v Federal Commissioner of Taxation (1994) 55 FCR 233 at 255. I respectively adopt his Honour's reasons at [60] to [70]. I shall not repeat them. Is there any point of distinction? In Wilhelm v McKay [2007] FCA 367 , one contention was that the applicant for the search warrant did not disclose certain information to the Magistrate. In that case, the non-disclosure was of information which the applicant claimed should have been disclosed. At [78] to [80], Greenwood J reviewed certain authorities touching upon the validity of search warrants procured through fraud or the absence of good faith: see eg Williams v Keelty [2001] FCA 1301 ; (2001) 111 FCR 175 at 225 [238] ; Lego Australia Pty Ltd v Paraggio [1994] FCA 1286 ; (1994) 52 FCR 542. He accepted at [80] that "the fundament of the duty is a duty to act in good faith and avoid making half-truths giving rise to a misrepresentation". His Honour's focus then was upon whether the applicants in that case had demonstrated an arguable case that in swearing the affidavit in support of the application for, and in applying for, the search warrant the person seeking the search warrant had misrepresented material facts going to the exercise of the power by the Magistrate to issue the warrant. As is apparent, I have assumed that a decision to provide to the Magistrate in support of the application for the search warrant information which could not lawfully be presented to him (or, somewhat more obliquely, a decision not to inform the Magistrate that information provided to him could not be relied upon by him) is a decision to which the ADJR Act may apply. That is not obviously so, for the reasons discussed in [37] above. In addition, the operative decision directly affecting the rights of Mr Nicholls is that to issue the search warrant. If that decision is not set aside, the operative decision will not have been impaired by the decision complained of itself being attacked. It is probable, in my view, that the cases discussed by Greenwood J in Wilhelm v McKay [2007] FCA 367 at [78] to [80] point to circumstances which would enliven s 5(1)(g) of the ADJR Act in relation to the decision to issue the warrant, namely that the decision to issue the warrant was induced or affected by fraud. For reasons which appear below, it is not necessary finally to decide whether that is the correct analysis of the decisions referred to. However, in considering whether to permit the amended application to be amended or read in the way which Mr Nicholls now contends, I encompass within that consideration the possibility that ground 9.4 of the amended application might be preserved so as to entertain an attack upon the validity of the decision to issue the search warrant if it were induced or affected by fraud. Order 35A of the Federal Court Rules empowers the Court to stay or dismiss a proceeding if an applicant is in default, that is, fails to comply with an order of the Court or fails to prosecute a proceeding with due diligence. The history of the conduct of these proceedings from their commencement indicates repeated failures by Mr Nicholls to comply with the orders of the Federal Magistrates Court and of this Court. His affidavit of 28 November 2008 goes some way to explaining why that is so, but it too was filed at the last moment, and after repeated unexplained failures to comply with orders of the Court. Mr Nicholls deposes to difficulties with funding, and to having to meet various demands and requirements of an administrator of a company with which he was involved as being "consuming and still on-going"; he deposes to being required to spend "considerable time" to prepare for various court hearings, and he says that: [his] ability to provide legal instruction to [his] own legal counsel has been hindered, primarily as a result of the following issues: (a) Delays caused by the ATO/AFP to make available the HDDs and suitable equipment to enable access the electronic data for the purposes of [his] claim of LLP in a timely manner; (b) Having to respond to the numerous ATO instigated legal actions against [him] personally and against [his] companies; (c) Having to be self-represented in relation to 47(b); (d) Delays caused by the AFP and ATO in compiling and releasing the requested information under the Freedom of Information Act 1982 due to apparent "staff shortages" within each unit; and (e) [His] not being able to access relevant material on the seized HDDs up until only recently to properly instruct [his] legal counsel on a potential claim of LPP and other legal matters relating to the validity and lawfulness of the search warrants. Mr Nicholls also deposes to "endeavouring to secure additional work given [his family's] current financial position", and to him "up-skilling [his] industry experience" by undertaking further study. The relevant question is whether, upon the proper construction of s 65 of the TAA and ss 263 and 264 of the ITAA, those provisions in their context permit or prohibit the use of information acquired under them for the purpose of applying for a search warrant under s 3E of the Crimes Act , and so for the purpose of exercising the power under s 3E. See the discussion in Wilhelm v McKay [2007] FCA 367 per Greenwood J at [78]. As noted above, s 3E of the TAA expressly recognises that information obtained by the Commissioner under the provisions of a tax law (which by definition includes under the TAA and the ITAA) and which is subject to taxation secrecy provisions may be used for specific purposes. The purposes include its use where the definitional requirements are fulfilled, as they are in this instance for applying for, and in consideration of whether to issue, a search warrant. And, at a later point, ss 3E(3) and (4) prohibit the disclosure of the information coercively obtained under a tax law to a Court other than as voluntarily provided to a court in the course of proceedings for a prosecution of a person for a tax-related offence (and for another presently irrelevant type of proceeding. By way of contrast, there are legislative examples where information provided to an executive authority under statutory compulsion may not be used in a subsequent criminal prosecution, where additional features (such as a contemporary claim to the privilege against self-incrimination) exist. See for example s 30 of the Australian Crime Commission Act 2002 (Cth) and s 597 of the Corporations Act 2001 (Cth), and the discussion in Cross on Evidence (7 th ed, 2004 at [25055]-[25060]).