REGINA v OC (Oliver Curtis)

BATHURST CJ: The appellant, the Commonwealth Director of Public Prosecutions (the CDPP), appealed, pursuant to s 5F(2) of the Criminal Appeal Act 1912 (NSW), from a decision of the primary judge granting OC (the respondent), a temporary stay of criminal proceedings brought against him in the following terms ([2014] NSWSC 1392 (Trial Judgment)):

The background to the order made by the primary judge may be summarised shortly.

On 13 January 2013, the respondent was served with a court attendance notice charging him with conspiracy to commit the offence, colloquially known as insider trading, contrary to ss 1311(1) and 1043A(1)(d) of the Corporations Act 2001 (Cth). An indictment charging him with this offence was presented in this Court on 7 February 2014.

In March 2009, the respondent was served with a notice pursuant to s 19 of the Australian Securities and Investment Commission Act 2001 (Cth) (the ASIC Act) requiring him to attend an examination in connection with an investigation being carried out by the Australian Securities and Investment Commission (ASIC) under s 13(1) of the ASIC Act. It was not disputed in the proceedings that ASIC had power to issue the notice.

The respondent was examined on 24 March 2009. The primary judge accepted evidence that the examination went to matters relevant to issues the subject of the charge, including matters the proof of which were necessary to sustain the charge. The primary judge also accepted that material relevant to the respondent’s defence to the charge had been revealed at the examination. It was not disputed that the answers were given under a claim of privilege against self-incrimination.

In the Trial Judgment, the primary judge accepted, at [17], that “The examination transcript, or a summary of it, was also provided to or read by officers of ASIC involved in the investigation … including by solicitors and staff at ASIC”. She also accepted that it was subsequently read by officers of the CDPP and prosecuting counsel.

The primary judge accepted, at [21], that neither ASIC nor the CDPP had endeavoured to meet the claims advanced by the respondent in correspondence leading up to the application for a stay that he would be prejudiced at the trial by the “prosecution team having had access to his examination transcript”. In particular, her Honour noted that no claim had been made that the content of the examination, from the perspective of the Crown, was irrelevant, or of no forensic significance in the presentation of the Crown case, or in anticipating any defence case which might be raised at trial.

None of the factual matters to which I have referred above were disputed on appeal.

It is convenient, prior to dealing with the reasons of the primary judge and the submission of the parties, to have regard to the legislative regime relevant to the proceedings and to its historical development.

Section 9 of the ASIC Act provides that ASIC is to consist of at least three and no more than eight members, three of which are to be fulltime members. Section 11 provides that ASIC is to have such functions and powers as are conferred on it by the Corporations Act and the ASIC Act. Section 12A(1) provides that ASIC has the powers and functions conferred on it by Div 2 of Pt 2 of the ASIC Act and certain other Acts. Section 12A(2) provides that “ASIC has the function of monitoring and promoting market integrity and consumer protection in relation to the Australian financial system”.

It is unnecessary to set out the many functions conferred on ASIC by the Corporations Act. Generally speaking, they involve the regulation and supervision of corporations, financial advisers, financial products and markets. As will appear subsequently, ASIC also has enforcement powers in respect of contraventions of the Corporations Act and related legislation.

Section 1 of the ASIC Act sets out the objects of the ASIC Act in the following terms:

Part 3 (ss 13-93AA) of the ASIC Act sets out the investigative and information gathering powers of ASIC. The general power of investigation is contained in s 13. Section 13(1) provides as follows:

Section 14 empowers the Minister to direct that ASIC investigate serious contraventions of the legislation referred to in s 13 and certain other matters, where the Minister considers it to be in the public interest to do so.

Sections 16, 17 and 18 deal with the powers and obligations of ASIC to report on such an investigation and to distribute the report. The provisions are in the following terms:

Division 2 of Pt 3 of the ASIC Act deals with examinations.

Section 19 empowers ASIC to conduct examinations in connection with its investigations. That section provides as follows:

Section 21 confers powers on the inspector who conducts the examination. It is in the following terms:

Section 22 of the ASIC Act provides that the examination is to take place in private. Section 23 entitles the examinee’s lawyer to attend.

Sections 25 to 27 of the ASIC Act deal with the signing and distribution of the record of the examination. They provide as follows:

Section 49 of the ASIC Act empowers ASIC to commence and carry on prosecutions for an offence against the ASIC Act or the Corporations Act. So far as relevant, it is in the following terms:

Section 63 of the ASIC Act makes it an offence to decline to answer a question in an examination without reasonable excuse. Section 64 makes it an offence to give false or misleading evidence at an examination.

Section 68 deals with the privilege against self-incrimination. It provides as follows:

Division 9 of Pt 3 of the ASIC Act deals with the evidentiary use of materials obtained in the examination. The relevant sections are ss 76 and 79:

Section 127 of the ASIC Act deals with confidentiality. So far as relevant, it is in the following terms:

Section 6 of the DPP Act confers the following functions on the CDPP, as relevant:

Section 9(5) of the DPP Act empowers the CDPP to take over proceedings for committal for an indictable offence instituted by another person. Section 9(5A) empowers the CDPP to decline to take such proceedings any further.

Section 10(2) of the DPP Act provides that nothing in the Act, other than s 9(5), affects the right of a person to carry on proceedings for the committal of persons for trial in respect of indictable offences against the laws of the Commonwealth.

Section 12 of the DPP Act deals with provision of information to the CDPP when it has taken over proceedings. It provides as follows:

Regulation 3(1)(f) of the DPP Regulations empowers the CDPP to give advice to Commonwealth authorities on law enforcement or matters relating to law enforcement.

Section 1315 of the Corporations Act provides for the institution of criminal proceedings under that Act. It is in the following terms:

The Corporations Act also provides for examination by the Court. The provisions relating to such examinations, contained in Div 1 of Pt 5.9 of the Act, are limited to examinations of the affairs of companies which are under external administration: Highstoke Pty Ltd v Hayes Knight GTO Pty Ltd [2007] FCA 13; 156 FCR 501 at [87]-[89]. The Court has power to give directions about the matters to be inquired into in an examination and the procedure to be followed. It also has power to control the examinations, including the questions that may be put by ASIC or the eligible applicant for the examination, as the case may be.

The legislation the subject of the present proceedings has a lengthy historical background. Section 12 of the Companies (Winding-up) Act 1847 (NSW) provided that if ordered to do so, persons involved with insolvent corporations were obliged to submit to an examination on oath before the Commissioner of Insolvent Estates and to make full discovery of the estate and effects of the company. Section 12 also provided that it was an offence to refuse to be examined, to not fully answer questions to the satisfaction of the Commissioner or to refuse to sign or subscribe to the examination.

Section 88 of the Companies Act 1874 (NSW) empowered the Governor, with the advice of the Executive Council, to appoint inspectors to examine the affairs of any company incorporated under the Act on the application of shareholders holding not less than 20% of the capital of the company, or in the case of a banking company, not less than 33%. The Act (s 90) obliged officers and agents of the company to be examined on oath by the inspectors and provided for a penalty for refusing to answer any questions. Section 93 provided that a report of an inspector was admissible in evidence.

The Act also introduced provisions empowering the Court, on the making of a winding-up order, to issue a summons for the examination of officers of the company concerning the affairs, dealings and estates of the company (ss 173 and 174). This appears to have been the precursor to Div 1 of Pt 5.9 of the present Corporations Act.

The Companies Act 1899 (NSW) substantially re-enacted the provisions of the 1824 Act.

The Companies Act 1936 (NSW) substantially re-enacted the provisions of the earlier legislation relating to the appointment of inspectors. However, it introduced a provision, s 117, to the effect that if it appeared to the Minister from the report that a criminal prosecution should be instituted in respect of an offence, he or she should order a prosecution to be instituted and it was the duty of all present and past officers and agents of the company to provide assistance. The provisions were also extended to permit the company, by special resolution, to appoint inspectors (s 118). This appears to have been the first occasion when the legislation anticipated that the inspector’s report would be used to consider whether criminal proceedings should be instituted.

The Act also conferred similar powers on the Court to those contained in the earlier legislation to summons officers and agents of an insolvent company for examination (ss 253-254).

Similar provisions relating to the appointment of inspectors were contained in the corresponding United Kingdom legislation. The 1945 Cohen Report commented on the operation of the provisions. The Report, in par [156], suggested that the Board of Trade should be given the power to appoint an inspector of its own motion, where there were reasonable grounds for suspicion of fraud or misfeasance or breach of duty. It also recommended, in par [159], that when, as a result of a report by an inspector, criminal proceedings were instituted by the Director of Public Prosecutions, it was the duty of all officers and agents of the company to give the Director all of the assistance which they were reasonably able to give.

The Second Reading Speech for the Companies Bill 1961 (NSW) stated that the amendments in that Act were based, in part, on the Cohen Report 1945 (UK). Section 169 of the Companies Act 1961 (NSW) contained similar provisions to the earlier legislation concerning the appointment of inspectors. However, it made provision for inspectors to make interim reports or notes on the investigation. It also provided, in s 169(5), that if, from a report, it appeared to the Governor that a person was guilty of an offence in relation to the company, the Governor may refer the matter to the Minister. Section 169(6) provided that if the Minister considered that the case was one in respect of which a prosecution should be instituted, he or she should cause it to be instituted and officers and agents of the company were required to give all reasonable assistance.

For the first time, the legislation expressly dealt with the privilege against self-incrimination. It provided as follows:

These provisions only protected against direct use of the answers. Further, s 171(7) provided that answers provided in an examination, other than those on which privilege was claimed, would be admissible in evidence.

The 1961 Act also empowered the Governor or the Court, on the application of the Minister, to appoint inspectors. It gave such inspectors powers, including the powers of examination, to which I have referred above.

Sections 249 and 250 also conferred power on the Court to summons persons who may have knowledge of the affairs of insolvent companies for examination. The provisions, which were generally similar to those contained in the 1936 Act, were considered by the High Court in two cases, Rees v Kratzmann [1965] HCA 49; 114 CLR 63 and Mortimer v Brown [1970] HCA 4; 122 CLR 493.

In Rees v Kratzmann, the question arose as to whether the respondent could be examined on matters outside of those the subject of a liquidator’s report, given pursuant to s 235(1) of the Companies Act 1961 (Qld) (relevantly in the same terms as the 1961 NSW Act), which formed the basis for the order for examination under s 250 of the Act. A majority (Kitto J dissenting) held that the respondent could be so examined. Each of the justices emphasised the powers of the Court to control the examination to ensure that it was not made an instrument of injustice or oppression (Barwick CJ at 66, Menzies J at 78, Taylor J agreeing, Windeyer J at 79). Windeyer J added the following comments (at 80):

In Mortimer v Brown, the High Court unanimously held that in a public examination under s 250, an examinee may not decline to answer a question on the ground that the answers may tend to incriminate him or her. Barwick CJ agreed with Walsh J and made the following observations (at 495):

Kitto J agreeing, also emphasised the policy of the section and that a reading down to allow the immunity would render the provisions nugatory. He expressed his conclusion as follows (at 496):

Walsh J, with whom Owen J agreed, reached the same conclusion. In doing so, his Honour expressed his agreement with the remarks of Windeyer J in Rees v Kratzmann, to which I have referred in par [45] above. He also concluded (at 502) that “it would not be in accordance with the plain language of the section to hold that the possibility of self-incrimination must be regarded by the court as decisive against allowing a question to be put”.

Significant amendments were made to the 1961 Act by the Companies (Amendment) Act 1971 (NSW). Relevantly, the provisions of s 171(5), (6) and (7) were repealed and replaced by s 174(3), which was in the following terms:

Section 174(1) provided that it was an offence to refuse to take an oath, fail to comply with the requirement of an inspector or make a false statement.

Section 176(5) conferred additional powers on the Minister to supply notes of the examination to a duly qualified legal practitioner who was acting for a person who was conducting or was contemplating, in good faith, legal proceedings in relation to offences the subject of the investigation.

Similar but not identical provisions concerning examinations were contained in the Securities Industry Act 1976 (NSW) and the Securities Industry Act 1980 (Cth). The latter Act conferred examination powers on an inspector to examine prescribed persons on an investigation into dealing in securities. Unlike the Companies Act 1961 or the Companies Act 1981, the legislation was not restricted to officers of the corporation, prescribed persons being defined in s 15(1) as persons “suspected or believed by an inspector, on reasonable grounds, to be capable of giving information concerning any matter being, or to be, investigated by the inspector”. Section 19(9) abrogated the privilege against self-incrimination for prescribed persons, but prohibited direct (not derivative) use of such answers in criminal proceedings against the examinee (other than in proceedings concerning the alleged falsity of an answer).

The Companies Act 1981 (Cth), adopted in New South Wales by the Companies (New South Wales) Act 1981 (NSW), provided for special investigations. The legislation provided, in s 296(7), that an officer of the corporation the subject of the investigation could not be excused from answering questions on the ground of self-incrimination, but the answer would not be admissible in evidence in criminal proceedings against him or her. However, the answer would be available in criminal proceedings for a contravention of the requirements of the section not to give false and misleading answers, proceedings for failing to take an oath or failing to comply with a direction or proceedings in respect of the falsity of the answer. The admissibility of the evidence of the examinations in subsequent proceedings was dealt with in s 299. It was in the following terms:

Section 303 made provision for dealing with objections to the admissibility of such statements in evidence in terms generally similar to s 79 of the ASIC Act.

The Act contained similar provisions to its predecessor, giving the Court power to summons persons to be examined concerning the affairs of insolvent companies. These provisions were considered by the High Court in Hamilton v Oades [1989] HCA 21; 166 CLR 486. That case involved an examination of the respondent, who had previously been charged with a number of offences relating to matters the subject of the examination. The Court held that s 541(12) of the Companies Act 1981, which provided that a person should not be excused from answering questions on the grounds that the answer might incriminate him or her, but if he or she claimed it might do so, the answer was not admissible in criminal proceedings, abrogated the privilege against self-incrimination. The majority (Deane and Gaudron JJ dissenting) held that neither the provisions of s 541(5), empowering the Supreme Court to give directions as to the matters to be inquired into, nor the inherent jurisdiction of the Court to control its own proceedings, authorised the Court to reject a question merely because it may have tended to incriminate the examinee.

Mason CJ, who formed part of the majority, accepted that the privilege could only be abrogated by the manifestation of a clear legislative intention through express words or necessary implication. He stated that “the phrase ‘necessary implication’ imports a high degree of certainty as to legislative intention”: at 495. He noted that there had been a long history of legislation relating to examinations in bankruptcy and under the Companies Acts which abrogated or qualified the right to refuse to answer questions on the ground of self-incrimination. He referred to the statement of Windeyer J in Rees v Kratzmann, to which I have referred above in par [45].

In rejecting the proposition that s 541(5) empowered the Court conducting the examination to reject questions merely on the ground that they might tend to incriminate the examinee, his Honour made the following remarks (at 497):

Deane and Gaudron JJ reached a contrary view on the application of s 541(5). Their Honours made the following remarks:

The investigation powers were again amended by the Australian Securities Commission Act 1989 (Cth). The Act was, in many respects, similar to the present ASIC Act. However, s 68(3) conferred a wider immunity from the use of self-incriminating answers. It provided as follows:

That protection was limited to direct use immunity by the Corporations Legislation (Evidence) Amendment Act 1992 (Cth), the amended section being in the same terms as now appears in the ASIC Act. The Explanatory Memorandum explained the purpose of the amendment in the following terms:

The primary judge, in the Trial Judgment, rejected the proposition that s 18 or s 127 of the ASIC Act authorised disclosure of the contents of the respondent’s examination to those officers of the CDPP responsible for the prosecution or those retained by the CDPP to conduct it. She concluded that neither provision expressly or impliedly referred to the examination transcript per se: at [29]. She said that the fact that s 17(3)(b) required that a report (referred to as a report under s 18(3)(c)) set out the evidence on which the finding of the investigation was based, does not require the answers given at an examination, particularly the self-incriminating ones, to be disclosed: at [29].

The primary judge noted the submission by the CDPP that “Parliament has not provided a statutory prohibition against disclosure”, which was consistent with there being no restriction in the ASIC Act on the use of an examination transcript by ASIC or the CDPP: at [33]. Her Honour also noted the CDPP’s submission that this was made manifest by the inclusion of Div 9 Pt 3 of the ASIC Act, concerning the evidentiary use of the material. She described this as the “mainstay of the [CDPP’s] submission that the Parliament has, by necessary intendment or implication, authorised disclosure to the CDPP” of the examination transcript: at [34].

In considering this submission, the primary judge noted that s 22 required the examination to take place in private. However, she rejected the submission that this was overtaken by s 49, which empowered ASIC to consider the examination transcript in deciding whether criminal proceedings should be commenced.

The primary judge accepted that “s 49(1) expressly contemplates that officers within ASIC may utilise an examination transcript for the purpose of making an informed decision under s 49(2) as to whether to charge a person with a criminal offence”: at [47]. However, she stated that “s 49 is silent as to whether the material … may also be made available to the CDPP” when prosecuting an offence pursuant to s 6(1)(a) and (b) of the DPP Act: at [47]. She thus concluded that the section left open whether the CDPP should also have the examination transcript: at [48]. Further, she stated that the question remained as to whether Parliament intended that offences against the corporations legislation, prosecuted on indictment, were to be conducted according to principles different to the fundamental principles of an accusatorial system: at [53]. She concluded that it was “both practical and achievable, consistently with the precepts of the general law, for that information to be quarantined to ensure that there is no risk of unfairness to that person in the conduct of any subsequent curial proceedings, whether those proceedings involve the imposition of civil penalties or criminal sanctions”: at [56].

The primary judge noted the CDPP’s submission that ss 76 and 79 of the ASIC Act demonstrated that Parliament intended that the prosecuting authorities be provided with the accused’s entire examination transcript in order to make an informed decision to tender it in proof of guilt.

In dealing with the issue, the primary judge referred to the decisions of Corboy J in R v Catena (No 3) [2013] WASC 97 and Smith v The Queen; Corp v The Queen [2007] WASCA 163; 35 WAR 201 (Smith). In the latter case, the Western Australian Court of Appeal considered that the time for considering when the privilege against self-incrimination was properly invoked, for the purpose of s 68(2)(b) of the ASIC Act, was at the time that the statement was sought to be tendered under s 76. In the Trial Judgment, her Honour concluded that the reasoning in Smith was “expressly confined to proceedings in respect of the falsity of a statement made under a s 19 examination”: at [76]. Her Honour concluded that to the extent that Catena (No 3) gave the section a wider operation, it should not be followed. She expressed her conclusions in the following terms (at [79]):

The CDPP accepted that it was “a fundamental principle of the accusatorial system of criminal justice that an accused cannot be required to provide any information or assistance to the Crown and can insist on the Crown proving its case”. However, it pointed out that it was well-established that Parliament may enact legislation modifying this principle. It submitted that this had occurred in the present case.

In that context, the CDPP pointed to the fact that “ASIC has the express function of investigating whether there has been a contravention of law, particularly the corporations legislation”. It pointed out that, for this purpose, ASIC was given the power to conduct examinations and it had the right, and in some cases the obligation, to provide a report which, by virtue of s 27 of the ASIC Act, was required to include the s 19 transcripts.

The CDPP also pointed to the fact that, in addition to its investigatory function, ASIC had enforcement functions. It pointed out that s 49(1)-(2) of the ASIC Act contemplated that where, as a result of an investigation or from a record of an examination, it appeared to ASIC that a person may have committed offences for which the person ought to be prosecuted, ASIC may cause a prosecution to be brought or carried on. It also pointed to the fact that these subsections contemplated that the record of examination could be used to determine whether a person should be prosecuted.

The CDPP submitted that the reference to ASIC “causing a prosecution … to be begun and carried on” in s 49(2) of the ASIC Act expressly contemplated that some prosecutions would be carried on by the CDPP. It submitted that when a prosecution is to be carried out by the CDPP, it was “necessarily implicit that the CDPP must be provided with sufficient information to enable it to provide informed advice to ASIC on whether or not charges should be laid and the particular offences to be prosecuted”. It submitted that disclosure of information to the CDPP would be for the purpose of ASIC officers performing their functions and would thus fall within s 127(3) of the ASIC Act.

In his submissions on behalf of the CDPP at the hearing of the appeal, the Solicitor-General for the Commonwealth summarised the nature and function of ASIC as a body devoted to the administration, including the enforcement, of specialist legislation and as an investigating and prosecutorial body. He submitted that these factors informed the use and disclosure it may make of the product of its examinations. He submitted that the primary judge was correct in accepting that s 49(1) of the ASIC Act contemplated that officers may use the transcript of examinations for the purpose of making an informed decision as to whether or not to charge a person with a criminal offence. However, he submitted that the section also entitled ASIC to go beyond that and have access and make use of the transcript throughout the whole of the prosecution if it was the sole prosecutor. He also submitted that where the CDPP takes over the prosecution, s 49(2) contemplated that it would have all of the material that was available to ASIC.

The Solicitor-General pointed to the form of the order made by the primary judge, prohibiting members of the prosecution team who had direct or derivative access to the transcript from being involved in the prosecution. He submitted that this would exclude a person from making an informed decision as to whether to prosecute. He pointed to the fact that the primary judge’s order would require that there be two teams within ASIC, one team involved in the decision to prosecute, who could have access to the record, and a separate team “uninfected by the record” to instruct and assist the CDPP. He submitted that such a bifurcation could not have been contemplated by the legislature.

The Solicitor-General also referred to the history of the legislation, to which I have referred above, submitting that since at least 1847, there had been a “second stream of executive inquiry under compulsion without court supervision”. He submitted that the historical analysis showed that the legislature moved from no protection against self-incrimination to protection against direct use and derivative use and back to direct use. He submitted that support for the construction contended for by the CDPP could be derived from the comments made by Mason CJ in Hamilton v Oades, to which I have referred above in pars [56]-[57]. He submitted, referring to that case, that the combined force of ss 19, 21, 63 and 68 of the ASIC Act was that both the privilege against self-incrimination and the associated right to silence had been abrogated in respect of one category of information; the product of a compulsory examination. He submitted that in respect of this category of information, the abrogation “has occurred once and for all”.

The Solicitor-General also placed reliance on the purpose of the examination, namely, to ascertain whether the suspicion of a contravention, which underpinned the compulsory examination, was sound and, if sound, it supported a prosecution under s 49 of the ASIC Act.

The Solicitor-General submitted that the combined effect of ss 18, 25, 49, 68, 76 and 127 of the ASIC Act was that the Act controlled who could gain access to the record of examination and how it could be used in evidence. He pointed to the fact that s 76 provided that the record could be used in evidence and was prima facie evidence of the statements it recorded, even in criminal proceedings. He submitted that a statement would only be inadmissible under s 68(3) if both of the requirements of s 68(2) were met, namely, the examinee claims the privilege and the statements in respect of which the privilege was claimed did in fact tend to incriminate the examinee. He submitted that even in cases where s 68(3) applied, the accused could seek to tender the material, in which case the prosecutor would require access to it to assess its admissibility.

The CDPP submitted that the primary judge erred in concluding that the potential application of ss 68(3) and 76(1) was confined to proceedings where a person was being prosecuted for the falsity of a statement made in the examination. It submitted that an analysis of Smith did not lead to this conclusion.

The CDPP submitted that its interpretation of ss 68 and 76 of the ASIC Act was supported by other cases, referring to: R v Anthony David Holmes [1996] TASSC 163; Australian Securities and Investment Commission v Fortescue Metals Group (No 2) [2009] FCA 424; 176 FCR 529 (civil penalty proceedings); R v Donaldson and Poumako [2009] SASC 31; 103 SASR 309; Catena (No 3); and R v Jacobson (Ruling No 4) [2014] VSC 508; 290 FLR 143. The CDPP also submitted that the primary judge was in error in stating that ASIC’s power to provide a report of the investigation to the CDPP did not authorise provision of the transcript. In that context, it referred to s 27(1) of the ASIC Act, which states that any final report must be accompanied by the record of examination.

In relation to the decision of the High Court in Lee v R [2014] HCA 20; 308 ALR 252 (Lee (No 2)), relied on by the primary judge and the respondent, the CDPP pointed to the fact that there was no equivalent to s 13(9) of the New South Wales Crime Commission Act 1985 (NSW) (the NSWCC Act) in the ASIC Act. It pointed to the fact that s 13(9) of the NSWCC Act operated prior to any trial, in contrast with the ASIC Act, which, it submitted, provided that the question of whether a statement would tend to incriminate an examinee would be determined at the trial.

At the hearing of the appeal, the Solicitor-General pointed to the fact that following the 1992 amendments to the then ASIC Act, there was no derivative use immunity. He submitted that this confirmed that all persons with lawful access to the record for the purpose of the proceeding could use it for all purposes connected with the proceedings. He submitted that s 49 of the ASIC Act did not require ASIC to “erect a Chinese wall or engage a different legal team at each stage”.

The Solicitor-General also submitted that the CDPP could be involved at each stage of the proceedings: in giving advice to ASIC on whether there was a fit case to prosecute; in consenting to the commencement of conspiracy proceedings; or in carrying on committal proceedings or proceedings on indictment. He submitted that that necessarily implied that the CDPP was authorised to inform itself and make use of the product of the s 19 examination in any of the ways that ASIC could do so.

The respondent submitted that no error warranting appellate intervention was established. He submitted that the primary judge’s reasoning conformed with the requirements set out in Lee (No 2) (at [32]) that clear words or words of necessary intendment are necessary to alter the fundamental principles of the accusatorial system. He submitted that the question which Lee (No 2) directed be considered was whether “the only constructional choice open is one whereby the ASIC Act necessarily abrogates the right of OC to require the Crown to prove its case unassisted by the accused, including by allowing the persons responsible for prosecuting him to have access to statements within the Transcript”.

The respondent submitted that “s 49 empowers ASIC to have regard to the result of an investigation or a record of examination conducted under s 19 in order to determine whether” to prosecute. He submitted, however, that the legislation was “silent as to whether ASIC officers privy to the examination transcript must be quarantined from any team entrusted with the conduct of any prosecution”. He submitted, referring to what was said by Hayne and Bell JJ in X7 v Australian Crime Commission [2013] HCA 29; 248 CLR 92 (X7) at [142], that for legislation to have the necessary implication to take away a fundamental right, “the implication must be necessary, not just available or somehow thought to be desirable”. He submitted that properly understood, s 49 did not speak to the matters under consideration in the present case.

The respondent submitted that s 68(3) contemplated “an exception in respect of proceedings concerning the falsity of a statement made [in an examination]; that is, a charge of perjury”. He submitted that the section was silent as to circumstances in which the transcript could be used otherwise.

The respondent submitted that s 76(1)(a) restated the operation of s 68(3). Relying on the construction contended for in respect of the latter section, he submitted that the issues of false or contradictory evidence could only arise once the proceeding was on foot. He submitted that in these circumstances, ASIC could properly review the transcript and bring matters to the attention of the CDPP for the limited purpose identified in s 68(3).

The respondent submitted that the effect of Lee (No 2) was that “the Court must commence with the basal premise that the precepts of a criminal trial cannot be disturbed save by express statutory authorisation”. He submitted that the “focal precepts” of such a trial included that “the onus of proof rests upon the prosecution” and “an accused person cannot be required to testify to the commission of the offence charged”. He submitted that, combining these principles, the prosecution “cannot compel the accused to assist it”.

Senior counsel for the respondent pointed to the absence of any constraint in the questioning in an examination under s 19 of the ASIC Act, contrasting it with the examination by the Court considered in Hamilton v Oades. He pointed out that the fact that questioning could be constrained was of importance in Hamilton v Oades. Further, he submitted that the majority of the High Court in Lee v New South Wales Crime Commission [2013] HCA 39; 251 CLR 196 (Lee (No 1)) relied on the fact of Court supervision to reach a conclusion different to that reached in X7.

Senior counsel for the respondent emphasised that it was not contended that the CDPP should not have access to the examination transcript for the purpose of advising whether charges should be brought, but rather, that those persons actually involved in the prosecution of the charges should not have access to that material.

The respondent submitted that Catena (No 3) was decided incorrectly. He submitted that s 76(1)(a) only had application in criminal proceedings where falsity is an element of an offence charged, namely, when proceedings fall within the exception in s 68(3)(c) and (d). He submitted that even if the decision in Smith was correctly applied in Catena (No 3), it must now be considered in light of X7 and Lee (No 2).

Senior Counsel for the respondent submitted that the primary judge was correct in accepting what he referred to as the “residual discretionary argument”. This argument was that even if the CDPP’s construction of the ASIC Act was accepted, there was no reason why, in this particular case, the trial team needed the transcript and the primary judge was entitled, as a matter of discretion, to order the stay due to “the unchallenged evidence in this case as to the prejudice or the advantage” of the transcript.

In supplementary submissions filed after the conclusion of the hearing, the respondent sought to clarify his submissions made in respect of the operation of ss 68 and 76. He submitted that one available construction of those provisions was that s 68(2) conditions the application of s 68(3). He submitted that either of the two conditions in s 68(2) may not be satisfied. He submitted that if the condition in s 68(2)(a) was not satisfied (no claim of privilege against self-incrimination before a statement), then the statement may be admissible. By contrast, he submitted that the precondition in s 68(2)(b) may not be capable of assessment until a later time, such as when a charge is laid. However, he submitted that that did not mean that all oral statements made at an examination were available to individuals conducting the prosecution. He submitted that this was not required either expressly or by necessary implication, as any argument as to whether the preconditions were satisfied could be conducted by a separate “voir dire team”. He submitted that, in any event, the problem did not arise in the present case as there was no evidence to suggest whether or not s 68(3) was likely to be engaged.

The respondent submitted that the primary judge did not conclude that neither s 18 nor s 127 authorised an ASIC officer to make a transcript available to the CDPP, as distinct from those officers actually carrying out the prosecution. Rather, he accepted that there were circumstances where the transcript could be provided. However, he said that the critical question was whether “there had been a miscarriage of justice in the eyes of the law”.

The respondent submitted that the 1992 amendments to the then ASIC Act, to remove the protection from derivative use of self-incriminating material, did not alter the position, as those amendments were not directed to the basal evidentiary position engaged by Lee (No 2).

The respondent also submitted that the primary judge was correct in concluding that s 49 did not require, as a matter of necessary intendment, that any officer or other person involved in the prosecution should be entitled to rely on the record. He submitted that the ASIC Act did not speak of the CDPP using the record for the purpose of a prosecution.

In submissions in reply, filed with leave after the hearing, the CDPP stated that “The ultimate question before the Court is whether the legislation in question, either expressly or by necessary intendment, puts the accused in a position different from that under the ‘pure’ accusatorial system”. It submitted that this identification of the issue demonstrated the difference between the statutory scheme of the ASIC Act in the present case and that in Lee (No 2). He submitted that in Lee (No 2), it was not only the alteration of the balance between the Crown and the accused which led to a finding that there was a miscarriage of justice, in addition, there was no legislative authority for the alteration. He submitted that in Lee (No 2), the alteration occurred contrary to the evident purposes of s 13(9) of the NSWCC Act and the evidence was inadmissible in any court proceedings by virtue of s 18B(2) of the NSWCC Act, contrary to the position in ss 68 and 76(1)(a) of the ASIC Act.

By contrast, the respondent submitted that s 18B(2) of the NSWCC Act served the same purpose as s 68 of the ASIC Act.

The CDPP further submitted that if there was a legal error as it contended, there was no alternate discretionary basis on which the conclusion of the trial judge could be justified.

It was not disputed by the CDPP that it is a fundamental principle of the accusatorial system of criminal justice that the prosecution must discharge the onus of proof and that the prosecution cannot compel the accused to assist it in the discharge of this onus: X7 at [101]-[102], [124], [159]; Lee (No 2) at [32]-[33]. Further, the principle remains even if the privilege against self-incrimination has been wholly or partly abrogated: Lee (No 2) at [33].

It was also accepted that the privilege against self-incrimination remains, at least so far as direct use of the self-incriminatory material is concerned. However, the provision of the transcript of a s 19 examination to those responsible for the prosecution of an examinee fundamentally alters the accusatorial judicial process, which begins with the laying of a charge and culminates in a criminal trial: X7 at [124].

A fundamental alteration of this nature made by legislation can only be made by clear words or necessary intendment: X7 at [125]; Potter v Minehan [1908] HCA 63; 7 CLR 277 at 304; Electrolux Home Products Pty Ltd v Australian Workers’ Union [2004] HCA 40; 221 CLR 309 (Electrolux Home Products) at [19]-[21]. As was pointed out by Crennan and Kiefel JJ in Momcilovic v The Queen [2011] HCA 34; 245 CLR 1 at [512], the principle of legality at common law requires that a statutory provision effecting such fundamental rights (in that case the presumption of innocence) be construed, so far as the language of the provision allows, to minimise or avoid displacement of the principle: see also French CJ at [43]. It has been pointed out on a number of occasions that general words will rarely be sufficient to alter such rights if they do not specifically deal with the question: Bropho v State of Western Australia [1990] HCA 24; 171 CLR 1 at 18; Coco v The Queen (1993) 179 CLR 427, 437-438.

In Coco, the majority stated that the principle may be displaced by necessary implication “if it is necessary to prevent the statutory provisions from becoming inoperative or meaningless”: at 438. In Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission [2002] HCA 49; 213 CLR 543, McHugh J pointed out, at [43], that courts will hold that legislation alters such rights by necessary implication if the object of the provision would be largely frustrated if the right, freedom or immunity was to be preserved.

In Lee (No 1), Gageler and Keane JJ, after citing the passages from Electrolux Home Products to which I have referred above in par [99], stated that while the principle of legality extends to the protection of fundamental principles, it should not be extended beyond its rationale “to protect from inadvertent and collateral alteration [of] rights, freedoms, immunities, principles and values that are important within our system of representative and responsible government”: at [313]. They went on to make the following remarks:

Nonetheless, the implication must be necessary and will not arise merely because it may be seen as available or desirable: X7 at [142].

The ASIC Act does not expressly provide that persons actually involved in the prosecution of a person who has been compulsorily examined can have access to the transcript of the examination. Therefore, it is necessary to consider whether the ASIC Act has provided so by necessary implication, in accordance with the principles to which I have referred above. Construction of the ASIC Act must begin with a consideration of the text itself. It will also require consideration of the context of the ASIC Act, including the general purpose and policy of the relevant provisions: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (Northern Territory) [2009] HCA 41; 239 CLR 27 at [47]; Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355 at [69].

ASIC may carry out an examination under s 19 of the ASIC Act in connection with an investigation under s 13. It is a precondition to such an examination that ASIC has reasonable grounds to suspect some contravention of the legislation referred to in that section. Section 17 empowers ASIC to prepare a report on the investigation, which must set out the evidence on which any findings are based. In the case of an investigation relating to a serious contravention of the law, ASIC is empowered by s 18 to give a copy of the whole or part of the report to a number of Commonwealth authorities, including the CDPP. Importantly, s 27(1) provides that if a report is prepared under s 17 as a result of an examination, the record of the examination must accompany the report. To the extent that the primary judge held that s 18(1)(c) did not require the transcript to be included with the report, her Honour, with respect, failed to have regard to the express requirements in s 27(1). However, unless directed by the Minister, there is no obligation to prepare a report and ASIC is not bound by s 18 to give a copy of the report to the CDPP.

Section 49 of the ASIC Act makes it clear that ASIC has a prosecutorial role as well as an investigative role. It is clear and not disputed that ASIC may take the record of the examination into account in considering whether a person has committed an offence and, in these circumstances, may cause a prosecution to be commenced and carried on.

The primary judge accepted that ASIC officers could make use of the transcript for making an informed decision as to whether or not to charge the examinee and institute proceedings. It is not clear, with respect, whether the primary judge was of the opinion that the transcript could be made available to the CDPP for such a limited purpose. However, the respondent accepted, correctly in my opinion, that it could be. This is consistent with the power conferred on ASIC in the case of a serious contravention of a law of the Commonwealth to supply a copy of the report, under s 18(2)(c), which is required to include a record of the examination, by virtue of s 27. This is also consistent with ASIC’s functions in commencing or carrying on a prosecution. It is also consistent with the CDPP’s powers under s 6(1) of the DPP Act to take over the prosecution and its power under reg 3(1)(f) of the DPP Regulations to give advice to ASIC concerning the charges.

There remains however the question of whether the use of the record of the examination is limited to making an informed decision on whether to lay charges or whether use could be made of the record in the subsequent conduct of the prosecution. Viewed in isolation, I do not think that s 49, coupled with the powers vested in ASIC in Div 2 of Pt 3 (ss 19-27) of the ASIC Act, necessarily implies that the latter is the case. The Act is silent as to the use that the CDPP can make of the material and limiting its use to the consideration of laying and formulation of charges does not render it inoperative or meaningless. Although such a limitation would doubtless cause some inconvenience and difficulty to prosecuting authorities, as I have pointed out, it is not enough that the implication may seem desirable.

However, the Act also expressly contemplates that evidential use may be made of the examination. It is necessary to consider whether these provisions necessarily imply that the transcript of the examination can be made available to the prosecutor for the purpose of carrying out the prosecution.

Section 76 expressly provides that a statement made in an examination is admissible in evidence against a person in a proceeding unless, relevantly, it is not admissible because of s 68(3) of the ASIC Act.

Section 68 obliges examinees to answer questions at a s 19 examination, notwithstanding that they might tend to incriminate the examinee. However, s 68(3) preserves direct use immunity if the conditions in s 68(2) are satisfied. The first condition in s 68(2) is that a claim for privilege is made before making the statement or signing the record. The second is that the statement or the signing of the record might in fact tend to incriminate the examinee.

The primary judge accepted, correctly in my opinion, that the time for determining whether these conditions are satisfied is at the time the statement or the record is sought to be tendered in evidence. However, she concluded that s 76(1)(a) is only available when the falsity of the statement made in the s 19 examination is an element of the offence. The primary judge, in reaching that conclusion, relied in particular on what was said in Smith at [72]-[74] and [86]-[88].

In my opinion, s 76(1)(a) of the ASIC Act cannot be confined in the manner suggested by the primary judge. Relevantly, s 76(1)(a) makes statements at an examination admissible unless s 68(3) applies. It is a precondition to s 68(3) both that privilege was claimed in respect to the statement at the examination and that the statement tends to incriminate. Unless both of these preconditions apply, s 68(3) has no operation.

Section 68(3)(c) and (d) operate as exceptions to the exclusionary provisions in s 68(3)(a) and (b). In proceedings in respect of the falsity of a statement, the statement is admissible irrespective of whether privilege is claimed at the examination and whether or not the statement may be self-incriminating.

In these circumstances, s 76(1)(a) does not have the limited effect found by her Honour. In proceedings other than for the falsity of the statement, the statement will be admissible unless the preconditions in s 68(2) are satisfied, in which case s 68(3) operates to exclude the statement. In proceedings for the falsity of the statement, the statement will be admissible irrespective of whether the preconditions in s 68(2) are made out.

I do not consider that the decision of the Western Australian Court of Appeal in Smith is authority to the contrary. Smith involved an appeal from a decision of the primary judge not to order separate trials and that charges brought under s 64(1) and (2) of the ASIC Act concerning the falsity of statements made in the examination be severed from the indictment.

In Smith, it was submitted by the Crown that in proceedings not relating to the falsity of statements made in an examination, any such false statements made in the examination may be admissible as lies evidencing consciousness of guilt. That proposition was rejected. The principal judgment was delivered by Buss JA, Pullin JA agreeing.

Paragraphs [72] and [74] of the judgment of Buss JA in Smith, cited by the trial judge in the Trial Judgment at [76], were under the heading “Ground 2: the proper construction of s 68(3) of the ASIC Act”: Smith at 226. In par [74] of his judgment, Buss JA stated, consistently with the construction to which I have referred above, that a statement is not admissible under s 68(3) if the preconditions in s 68(2)(a) and (b) are satisfied. He then, correctly, with respect, pointed out that the general prohibition is subject to an exception in proceedings in respect of the falsity of the statement.

The remaining paragraphs of the judgment of Buss JA in Smith cited by her Honour (pars [86]-[88]) were directed to the question of whether the general prohibition in s 68(3) precluded the statement from being received in evidence in proceedings where falsity is not an issue “for the purpose of establishing that the statement was a lie told out of a consciousness of guilt”. In these paragraphs, his Honour was not considering the admissibility of statements when the preconditions to the operation of s 68(3) contained in s 68(2)(a)-(b) were not satisfied.

Once it is accepted that statements made during a s 19 examination are admissible in criminal proceedings, unless the two preconditions in s 68(2) are met and that the time for determining whether these conditions are satisfied is at the time the statements are sought to be tendered in evidence, it follows, as a matter of necessary implication, that the CDPP officers responsible for the conduct of the proceedings are entitled to have access to the examination transcripts, not only to formulate charges, but to prosecute them. This access would enable CDPP officers to consider whether the privilege was properly claimed on any answer and whether the transcript could be tendered. Her Honour, with respect, erred in reaching a contrary conclusion.

The alternative construction propounded by the respondent (see par [90] above), suggesting that it was not necessarily implicit that the CDPP was entitled to have access to the transcript, as a separate “voir dire team” could be engaged by the prosecution, derives no support from the terms of the legislation. Rather, the ASIC Act, particularly s 49, in conjunction with ss 68, 76 and 77, in my view, discloses, by necessary intendment, that if a prosecution is caused to be commenced or carried out by ASIC, the prosecutors may be given access to the transcript of a s 19 examination and, subject only to the prohibition against the direct use of self-incriminating material in s 68, can use it for the purpose of the prosecution.

I have dealt with the matter thus far without reference to the purpose and object of the provisions in the ASIC Act. It is evident from the functions of ASIC, to which I have referred in pars [11] and [12] above, that it is entrusted with the supervision and regulation of corporate activity, including the enforcement of legislation relating to corporations. The comments of Windeyer J in Rees v Kratzman and those of Barwick CJ, Kitto J and Walsh J in Mortimer v Brown, to which I have referred in pars [45]-[48] above, are as applicable today as when they were made. In Johns v Australian Securities Commission [1993] HCA 56; 178 CLR 408, a case dealing with the provision of a s 19 examination transcript to a Royal Commission, Brennan J made the following remarks as to the use that can be made of such transcript at 424-425:

One of the functions of ASIC is to cause a prosecution for a contravention of corporations law to be commenced and carried on. Making the transcript available to the person who has the responsibility to carry out such a prosecution is consistent with such functions.

The historical analysis to which I have referred above also supports the conclusion which I have reached. As has been pointed out in a number of cases, the legislature has, for many years made “special exceptions to the otherwise accusatorial process of the criminal law in respect of bankruptcy and companies examinations”: X7 at [140]; see also Lee (No 1) at [317]. The legislative history to which I have referred also shows that this was not confined to examinations by courts. As the Solicitor-General pointed out (see par [73] above), there has been, since 1847, a “second stream of executive inquiry under compulsion without court supervision”. At least since the Companies Act 1874 (NSW), that executive inquiry did not solely relate to matters of bankruptcy and insolvency, but extended to inquiries in respect of fraud, misfeasance and breach of duty in relation to corporations. The legislation provided for the tender of a “report”, or non-self-incriminating answers, into evidence (see e.g. s 93 of the Companies Act 1874 (NSW), s 171(7) of the Companies Act 1961 (NSW)). Since the Companies Act 1961 (NSW), provision has been made for the introduction of statements made at examinations into evidence, with consideration given to whether and to what extent the privilege against self-incrimination should be abrogated. The legislative history shows that, irrespective of the availability of court supervision, it was intended that use could be made of the transcript in court proceedings, subject to such protection against self-incrimination conferred by the legislature.

In these circumstances, the trial judge erred in law in the exercise of her discretion. Once it is established, as a matter of construction, that the prosecution was entitled to the transcript of the examination, there was no basis on which a “residual discretion” could be exercised to effectively deprive the prosecution of the transcript. The appeal should be allowed and the stay granted by her Honour set aside.

I would make the following orders:

R A HULME J: I agree with Bathurst CJ.

BELLEW J: I agree with Bathurst CJ.