Application of the Securities and Exchange Commission of the United States of America under the Evidence on Commission Act 1995 (NSW) (No 2)

By summons dated 19 August 2020, the Securities and Exchange Commission of the United States of America (“the SEC”) commenced proceedings seeking orders pursuant to section 33 of the Evidence on Commission Act 1995 (NSW) (“the Act”) to obtain evidence from ten witnesses resident in New South Wales (“the Witnesses”), by way of oral examination under oath, for use at trial in the matter of Securities and Exchange Commission of the United States of America v Eric Pulier, 2:17-cv07124-PSG-RAO (“the US proceedings”).

The US proceedings concern an action filed in the United States District Court in the Central District Court of California (“the US Court”) on 27 September 2017. The initiating process is described as “a complaint”. The complainant, the SEC, alleged the jurisdiction and venue of the country as being:

There were five “claims for relief” alleging violations of two US Federal security statutes, namely, the Securities Act of 1933, 15 USC §§ 77a-77mm (“the Securities Act”) and the Securities Exchange Act of 1934, 15 USC § 78a (“the Exchange Act”).

The proceedings before this Court were commenced pursuant to Letters of Request issued by the US Court dated 11 May 2020 (“Letters of Request”). Expedition was granted on 8 September 2020 by Wright J: Application of the Securities and Exchange Commission under the Evidence on Commission Act 1995 (NSW) [2020] NSWSC 1212 (“SEC No 1”). His Honour took into account an extended time for “discovery” in the US proceedings (as that expression is understood in the Federal Rules of Civil Procedure, which govern civil proceedings in the United States district courts) was 16 October 2020.

The Witnesses are:

On 15 September 2020, Mr Pulier filed a notice of motion to examine the Witnesses (“the motion”).

The form of orders sought in the summons and motion underwent some transformation during the course of the proceedings and ultimately converged, which will be discussed below.

A brief and preliminary description of the witnesses follows:

Mr Pulier was the Founder and former Chief Executive Officer of ServiceMesh and defendant in the US proceeding.

Mr Keith Hunter worked for CBA as the Executive General Manager in charge of Operations, IT Security, Application Development and IT Engineering at CBA. Mr Hunter’s employment was terminated in 2014. Mr Hunter was jailed in 2016.

In support of the summons, the SEC relied on the following affidavits and exhibits filed and served in these proceedings:

In support of the motion, Mr Pulier relied upon the following:

Mr Miller is a Senior Trial Attorney of the SEC and lead counsel in the US proceedings. Prior to his employment with the SEC, he was engaged for 12 years as an Assistant US Attorney at the US Attorney’s Office (“USAO”) for the Central District of California.

Mr Munstermann is a partner of the law firm McCullough Robertson and the Australian legal representative for the SEC.

Ms Ford is a partner of the law firm Arnold Block Leibler and Australian legal representative of Mr Pulier. Mr Rapore is a partner of the law firm Kirkland & Ellis LLP and counsel for Mr Pulier in the US proceedings.

Mr Waldron adduced evidence by affidavits from Mr Phillip Gibson, a solicitor with Nyman Gibson Miralis. Those affidavits were sworn on 1 and 25 September 2020, respectively.

The deponents of the various affidavits were not required for cross-examination.

In March 2015, Mr Waldron was charged with a number of offences in New South Wales. Mr Gibson deposed that the charges “are the same as contained in the … SEC application in the Pulier Letter of Request”. Committal proceedings with respect to those charges occurred between 12 and 23 February 2018.

On 27 September 2017, the USAO filed a criminal indictment against Mr Pulier and Mr Waldron in the US Court. The indictment contained 15 counts and criminal forfeiture. Relevantly, counts 1 to 6 are set out below.

Count 1 alleged a conspiracy between Mr Pulier and Mr Waldron and Mr Hunter and others “known or unknown” with respect to securities fraud contrary to 18 USC § 1348 and wire fraud in violation of 18 USC § 1343.

Count 2 was expressed as follows:

Counts 3 to 6 were as follows:

On 27 September 2017, the SEC filed the complaint against Mr Pulier in the US Court commencing the US proceedings.

On 6 June 2018, the USAO filed a “stipulation” to allow the United States of America to intervene in the US proceeding for the purpose of staying civil discovery during pendency of criminal proceedings filed separately by the USAO against Mr Pulier. After referring to the indictment, the USAO stated in para 3 of the stipulation as follows:

On 8 June 2018, the US Court made an order permitting the intervention of the United States of America, by the USAO, in the US proceeding and staying civil discovery during the pendency of the USAO’s criminal proceedings.

On 20 December 2018, the USAO’s criminal proceedings were dismissed with prejudice (such that they cannot be reinstated).

On 11 March 2019, the SEC and Mr Pulier’s representatives gave notice of the dismissal of the USAO’s criminal proceedings in the US proceeding and sought, among other matters, that the US Court convene a status conference to return the US proceedings to the active docket and set pre-trial and trial dates for the US proceedings.

On 8 July 2019, the US Court ordered the US proceedings to be set for a jury trial to take place beginning on 1 December 2020 and continuing for approximately 10 days.

Discovery was ordered in the US proceedings, to be completed by 28 August 2020.

The SEC and Mr Pulier’s representatives jointly (by consent) then petitioned the US Court requesting the issuance of Letters of Request by the US Court to this Court.

On 11 May 2020 the US Court issued the Letters of Request.

On 21 and 22 May 2020, McCullough Robertson wrote to each of the Witnesses and provided them with copies of the relevant Letters of Request issued by the US Court. Other than Mr Waldron, none of the Witnesses indicated that they opposed the SEC’s application to give effect to the Letters of Request.

On 25 June 2020, an indictment was laid against Mr Waldron involving 13 counts for breaches of ss 129E(1)(b) and 249B(1) of the Crimes Act 1900 (NSW).

Mr Waldron’s trial is listed to commence on 26 October 2020 in the District Court of NSW with an 8-week estimate (“the NSW criminal proceedings”).

Until 14 September 2020, the order made by the US Court was that evidence and discovery with respect to the US proceedings must be completed by 16 October 2020.

On 14 September 2020, the US Court ordered, inter alia, that:

The SEC is an independent federal government regulator responsible for enforcing, among other federal securities laws, the Securities Act and the Exchange Act. The SEC is also responsible for regulating the securities markets in the United States of America and protecting investors.

When the SEC brings civil proceedings against a person, it is authorized to seek enumerated statutory and equitable remedies, including, for example, civil injunctions to prevent violations of securities laws, pecuniary penalties, disgorgement of ill-gotten gains, and other forms of relief such as an officer/director bar.

The SEC does not have jurisdiction to institute criminal proceedings against a person or corporation; nor does it have jurisdiction to file criminal charges or to arrest or imprison individuals who have violated federal securities laws. The SEC may, however, refer potential criminal cases to criminal law enforcement authorities, such as the United States Attorney’s Office (“the USAO”), or conduct its own SEC investigation while criminal authorities conduct parallel investigations involving the same conduct.

The US proceedings concern the purchase by Computer Sciences Corporation (“CSC”) of ServiceMesh pursuant to an Equity Purchase Agreement (“EPA”) in 2013. According to the SEC’s allegations, the EPA contained an earn-out provision, under which a portion of the consideration paid to ServiceMesh’s equity holders, including Mr Pulier, was based on ServiceMesh’s revenue.

Relevantly, under the final agreement, ServiceMesh shareholders would earn approximately $10.15 for every dollar of revenue above $20 million that ServiceMesh generated between 1 January 2013 and 31 January 2014, with a maximum earn-out payment of $137,014,548.

The SEC alleged that Mr Pulier, as the former CEO of ServiceMesh, improperly inflated the earn-out payment that CSC owed ServiceMesh equity holders and defrauded CSC by paying bribes to obtain two sets of contracts between ServiceMesh and the CBA.

The SEC claimed that Mr Pulier caused ServiceMesh to secure contracts with the CBA in:

The two contracts contributed approximately $10.4 million in revenue towards the calculation of the earn-out payable by CSC under the EPA.

The SEC alleged that Mr Pulier secured the contracts with the CBA by paying bribes in 2014 to two CBA executives, Mr Hunter and Mr Waldron, through a charitable organisation named the Ace Foundation.

The SEC also alleges that Mr Pulier violated various federal securities laws by stating in a “representation letter” dated 30 January 2014 and “sub-certification” made by him in 30 April 2014 that he was not aware of any undisclosed “side agreements” with customers in connection with the earn-out contracts (and did not disclose the alleged scheme to pay bribes through the Ace Foundation).

In addition to the US proceedings, there have been various other proceedings and prosecutions commenced by competent authorities in relation to persons involved in those events described above.

Relevantly:

In the US proceedings, the SEC has brought an action against Mr Pulier alleging that Mr Pulier:

The relevant provisions of the Securities Act and Exchange Act, namely, 15 USC §§ 77q(a), 78j(b) and 78m(b)(5), are extracted below:

The relevant rules appear in the Code of Federal Regulations (see Commodity and Securities Exchanges, 17 CFR §§ 240.10b-5 and 240.13b2-1) and are extracted below:

The SEC seeks, amongst other things, orders from the US Court for civil penalties against Mr Pulier.

Relevantly, the SEC seeks against Mr Pulier under the Securities Act and Exchange Act:

By way of elaboration, Mr Miller stated:

As to No Violation Order, 15 USC §§ 77t(b) and 78u(d)(1) provides as follows:

Reference may also be made to 15 USC § 77t(a), which is extracted below:

As to the Disgorgement Order, 15 USC § 78u(d)(5) provides:

As to the Civil Penalty Order, 15 USC §§ 77t(d)(1) and 78u(d) provide:

Mr Waldron also made the following submission with respect to civil penalties:

As to the Director and Officer Ban, 15 USC §§ 77t(e) and 78u(d)(2) are in the following terms:

Mr Waldron also referred to the provision of 15 USC § 77x, which is extracted below:

Reference was also made to various investigative functions or powers of the SEC in the following submission:

Furthermore, Mr Lange of counsel for Mr Waldron made reference to monetary penalties as follows:

Lastly, Mr Waldron made a submission as to the provisions of 15 USC § 78ff(a) as follows:

The terms of the Letters of Request are relatively similar for each witness requested to be deposed.

Each letter of request, relevantly, inter alia:

Each witness sought to be examined by the SEC is a resident in NSW.

Each witness is described in the Letter of Request pertaining to that Witness as (in relation to the “Purpose of the Evidence Sought”): “possess[ing] information that is relevant and essential to” the US proceedings brought by the SEC against Mr Pulier.

I accept the submission of the SEC, in broad terms, that the Witnesses have, so far as the SEC is concerned, knowledge that goes to:

Of the Witnesses, Mr Keaney and Mr Murphy also have knowledge as to:

The relevance of each witness and their role in the underlying context of the US proceedings, as described in the Letters of Request issued by the US Court, appears below.

Mr Twynham worked for ServiceMesh at the time of the alleged bribery scheme as the Vice President of Emerging Market Programs.

For several years, he worked directly with Mr Hunter and Mr Waldron, including on the McAfee and Pivotal contracts.

Mr Twynham exchanged several emails with Mr Pulier, Mr Hunter, and Mr Waldron about the McAfee and Pivotal contracts, where they discussed the status of the contracts, the cost of the contracts, ServiceMesh’s ability to recognise revenue from the contracts, why the contracts were necessary, and the steps needed to complete the contracts.

Mr Twynham also exchanged text messages with Mr Waldron at or around the time the SEC alleges Mr Waldron received bribe payments.

Mr Nicholson worked for CBA during the alleged bribery scheme as Executive Manager of Software Asset Management.

Mr Nicholson worked directly with Messrs Waldron and Hunter on the McAfee contract and reviewed it to determine whether it was financially viable, legally sustainable, represented an acceptable level of risk, complied with relevant legislation, and met all of CBA’s policies and procedures.

Mr Nicholson communicated with Mr Waldron and others regarding the McAfee contract because he was uncomfortable with the deal. Although Mr Nicholson raised his concerns about the McAfee contract with Mr Waldron and his supervisor, Messrs Waldron and Hunter pushed the deal through.

Mr Waldron worked for ServiceMesh at the time of the alleged bribery scheme as the General Manager of IT Engineering. He worked for Messrs Hunter and Harte and was instrumental in getting both the McAfee and Pivotal contracts approved and finalised.

The SEC contends that Messrs Waldron, Hunter and Harte all conspired with Mr Pulier to defraud CSC out of more than $98 million by accepting bribes from Mr Pulier while they were employed at CBA in exchange for helping Mr Pulier and ServiceMesh obtain the McAfee and Pivotal contracts that together were worth over $10 million.

The SEC alleges that Mr Pulier caused a total of $1.9 million in bribe payments to be paid to Mr Waldron.

Mr Kelada worked for CBA during the alleged bribery scheme in IT Engineering Technology Platforms.

One of his responsibilities was to determine how Pivotal could be introduced into CBA’s IT databases in a manner that satisfied CBA’s application needs and was adapted to its security and risk environment.

Mr Kelada spoke with Mr Waldron about Pivotal and CBA’s plans for implementing it.

In addition, Mr Kelada knew the services that ServiceMesh was providing to CBA through its Agility Platform and, at around the time of the alleged bribery scheme, gave an assessment of the overall business relationship between ServiceMesh and CBA.

Mr Kelada identified a number of issues in the Agility Platform that existed during the alleged bribery scheme and during the time the Pivotal contract was being negotiated and finalised.

Mr Richardson worked for CBA during the alleged bribery scheme as a General Manager in Partner Management of IT Delivery Services. He worked directly with Mr Waldron and Mr Hunter on the McAfee contract and had raised several potential concerns about the deal regarding its pricing, legal implications, and the risks that it created for CBA.

Mr Richardson was kept apprised of the McAfee contract as it was being finalised and was tasked with handling several of the issues that arose during that process. Mr Richardson exchanged several emails with Messrs Waldron and Hunter about the McAfee contract and also briefed Mr Harte on the McAfee contract shortly before it was approved.

Mr Pennington worked for CBA during the alleged bribery scheme as an Executive Manager of Engineering Delivery in IT Engineering Enterprise Services. He worked directly with Messrs Waldron and Hunter on the McAfee and Pivotal contracts.

Mr Pennington reviewed the transaction documents for the McAfee contract and exchanged emails with Mr Twynham, and Messrs Waldron, Hunter, and Harte regarding, inter alia, how the McAfee contract departed from an earlier services agreement, how quickly the McAfee contract could be finalised, and who had the legal authority to sign the McAfee contract on behalf of CBA.

Mr Pennington also worked directly with Messrs Waldron and Hunter on the Pivotal contract. Mr Pennington reviewed the transaction documents for the Pivotal contract and was the one who broke them up into several separate contracts based on discussions he had with Mr Hunter.

Ms Lane worked for CBA during the alleged bribery scheme in the Technology Risk in the IT Delivery Services business unit at CBA.

Ms Lane was directly involved in reviewing the McAfee contract and raised a potential concern about the urgency surrounding the approval of the McAfee contract and whether there was sufficient time to conduct a risk assessment of the contract.

In particular, Ms Lane felt that the short amount of time she had to work on the McAfee contract would prevent her from providing definitive advice on the risk the contract posed to CBA and recommended delaying execution of the contract.

Mr Smith worked for CBA during the alleged bribery scheme as the Head of Technology Risk in the IT Delivery Services business unit at CBA.

Mr Smith was directly involved in reviewing the McAfee contract. He raised a potential concern about the McAfee contract regarding the risk that it created for CBA.

In particular, Mr Smith wanted a risk assessment done on the McAfee contract because it involved new services and products coming from an existing supplier.

Mr Smith’s co-worker, Mr Richardson, raised Mr Smith’s concerns with Messrs Waldron and Hunter before the McAfee deal was approved.

Mr Keaney and Mr Murphy worked for CBA during the alleged bribery scheme in Group Investigations and Advisory Services.

Mr Keaney and Mr Murphy questioned Mr Hunter as part of an internal investigation conducted by CBA into the payments Messrs Hunter and Waldron received in their bank accounts.

Mr Keaney and Mr Murphy requested that Mr Hunter provide information and documentation explaining the alleged bribery payments. Mr Hunter told him the payments were for services Mr Hunter allegedly provided to an entity in connection with building more than 15 data centres and refurbishing approximately 30 more.

Mr Hunter provided what he claimed were Statements of Work and invoices submitted to that entity.

Senior counsel for Mr Pulier, Ms H Younan SC, also described the relevance of each witness to the US proceedings. As to Messrs Twynham, Nicholson and Waldron, the following submission was advanced by Mr Pulier:

The form of each of the above references to Mr Rapore’s affidavit are in similar terms. For example, the last mentioned extract of senior counsel’s written submissions refers to Mr Rapore’s affidavit at paras 57-60. That aspect of his evidence is as follows:

The submissions by Mr Pulier as to the remaining witness follow a similar pattern.

The position of each of the parties with respect to the orders sought by the SEC in its summons was, at the outset of the hearing before the Court, as appears below.

Mr Twynham consented to the orders sought by SEC, insofar as they affect him. That consent was on the basis that the SEC agreed to pay his reasonable legal expenses in relation to his deposition by the SEC, being the reasonable costs of any advice provided in relation to the deposition, preparation for the deposition and representation during the deposition.

The CBA witnesses (namely, Messrs Kelada, Murphy, Pennington, Richardson and Smith and Ms Keaney) neither consented to nor opposed the application for examinations, provided that:

Mr Waldron opposed orders sought in the summons.

Mr Nicholson neither consented to nor opposed the orders sought in the summons and motion, provided that:

Upon the second day of the hearing, Ms Younan SC who appeared for Mr Pulier, produced short minutes of order (“the short minutes”) in mark-up form proposing variations to the orders proposed in the summons (and corresponding to the short minutes of order produced at the outset of the hearing by the SEC). The short minutes are attached to this judgment, without mark-up, and are entitled “Annexure A”. Those orders effectively dealt with the qualifications expressed by various parties as to the summons in the above summary, save for Mr Waldron.

As to those short minutes, the position of the parties (other than Mr Waldron, who maintained opposition to the proposed orders) was as follows:

In that sense, the proceedings went forward, in substance, upon the summons being pressed on an amended basis in that way.

On 21 October 2020, the Court announced orders which were entered on 22 October 2020. Those orders are extracted below:

These are the Court’s reasons for decision, with respect to those orders made upon the summons and motion.

Part 4 of the Act is in the following terms:

Part 4 of the Act is entitled “Taking of evidence for foreign and Australian Courts”. It enacts the provisions of the Hague Convention of 18 March 1970 on the Taking of Evidence Abroad in Civil or Commercial Matters (“the Hague Convention”) by the mechanism of translating the treaty provisions into domestic law. Implementation was done, in that respect, by State legislation: British American Tobacco Australia Services Ltd v Sharon Y Eubanks for the United States of America (2004) 60 NSWLR 483; [2004] NSWCA 158 (“BAT”) at [16]-[17] (per Spigelman CJ, with whom Handley and Bryson JJA agreed) (see also Re Application of Computer Sciences Corporation under the Evidence on Commission Act 1995 (NSW) [2017] NSWSC 810 (“CSC No 1”) at [29] (per Adams J)).

Spigelman CJ in BAT referred to the Second Reading speech for the legislation as follows (at [19]):

His Honour also referred to the origins of Pt 4 as follows (at [20]):

The jurisdiction of this Court under Pt 4 of the Act is conferred by s 32. Two relevant elements may be identified.

First, s 32(1) of the Act provides that Pt 4 of the Act will apply if an application is made to this Court for evidence to be obtained in NSW and the Court is satisfied that:

Secondly, s 32(2) provides that Pt 4 of the Act will not apply in respect of proceedings relating to the commission of an offence or an alleged offence unless the requesting court is a court of a place in Australia or New Zealand. Mr Waldron contended that the present application made with respect to him falls outside the jurisdiction of the Court in consequence of that provision. I will return to that consideration.

Section 33(1) of the Act provides that, if an application is made under s 32, this Court may make an order making such provision for the obtaining of evidence in New South Wales as appears appropriate for the purpose of giving effect to the request, including the oral examination of witnesses (see s 33(3)). That provision confers a power upon the Court which extends to the court making an order requiring a person to take steps as the court may consider appropriate for that purpose.

Section 33(4) provides that any steps to be taken must be steps that can be required to be taken by way of obtaining evidence for the purposes of proceedings in this Court.

Section 34 of the Act provides safeguards as to the privilege to witnesses compelled to give evidence by virtue of an order under s 33 of the Act.

Having satisfied itself the requirements of s 32 are met, the Court has a discretion whether or not to make an order under s 33 of the Act: BAT at [14].

In BAT (at [41]), Spigelman CJ considered that the history of the Australian scheme indicates that the British case law should generally be followed in Australia and that where possible an international treaty of this character should be interpreted in an internationally uniform way. That passage from BAT is as follows:

In determining whether to give effect to an application under section 32, by orders under s 33, Spigelman CJ in BAT considered that the Court should apply the factors summarised in Gredd v Busson [2003] EWHC 3001 (“Gredd”) at [27].

The relevant factors as derived from Gredd are as follows:

Letters of request should be given effect to the fullest extent possible: Re Westinghouse Electric Corporation Uranium Contract Litigation [1978] AC 547 at 612 and 654; Re Asbestos Insurance Coverage Cases [1985] All ER 716 at 719; Pickles v Gratzon (2002) 55 NSWLR 533 at [50] and Re Hague Convention [2008] SASC 51 at [13].

In my view, having regard to the foregoing discussion, the provisions of s 32(1) of the Act are satisfied in this case for the following reasons:

The SEC made written and oral submissions, which are reflected below.

In BAT, the Court of Appeal refused to grant leave to appeal the decision of Bell J refusing to set aside orders made by James J requiring a witness to be examined pursuant to s 33 of the Act, giving effect to a letter of request issued by the United States District Court for the District of Columbia (“the Columbia Court”).

The proceedings before the Columbia Court were brought by the United States of America against a number of tobacco companies arising out of alleged violations of United States racketeering laws: Application of Cannar Re Eubanks [2003] NSWSC 802 at [114] and [117].

In Sykes v Richardson (2007) 70 NSWLR 66; [2007] NSWSC 418 (“Sykes”) (per Hidden J) this Court considered whether to make an order under s 33 of the Act, for the examination of a witness for the purpose of proceedings before the United States District Court for the Western District of Wisconsin (“the Wisconsin proceedings”).

The Wisconsin proceedings concerned “a civil action arising out of the alleged involvement of [a named company] in a conspiracy to manipulate the copper futures market from 1993 through 1996 in violation of the Sherman Antitrust Act”: Sykes at [4].

That conspiracy was said to be a violation of § 1 of the Sherman Antitrust Act of 1890, 15 USC §§ 1-38 (“Sherman Antitrust Act”). Contravention of that section amounted to a felony, carrying a substantial term of imprisonment and an equally substantial fine: Sykes at [4]. The plaintiff also sought treble damages: Sykes at [14].

The Court found that the Wisconsin proceedings were civil, not criminal. At [10] Hidden J considered that:

His Honour noted at [22], that the Wisconsin proceedings were not “proceedings relating to the commission of an offence”.

His Honour subsequently concluded that the Wisconsin proceedings did not relate to the commission of an “offence” within the meaning of s 32(2) of the Act and further the examination of the applicant was “not a step, direct or indirect, in the enforcement of a penal law of the United States”: Sykes at [25].

It is convenient at this juncture to extract passages from the judgment of Hidden J (at [21]-[23]):

In CSC No 1, this Court considered whether to make an order under s 33 of Act, for the examination of four witnesses and for the purpose of proceedings before the Court of Chancery of the State of Delaware in the United States of America (“the Delaware Court”). The case concerned the same underlying facts as the present proceedings and were brought by CSC against Mr Pulier (and TechAdvisors LLC) for the recovery of US$98 million. Relevantly, as in these proceedings, CSC alleged that Mr Pulier paid bribes to Mr Hunter and Mr Waldron to obtain the McAfee and Pivotal contracts. Mr Pulier had stated claims of fraud and other misconduct against CSC: CSC No 1 at [9].

The Court found that the Delaware Court proceedings did not relate to the commission of an offence, and in doing so held (at [51]):

In Application of Computer Sciences Corporation under the Evidence Act 1995 (NSW) [2019] NSWSC 777 (“CSC No 2”), this Court again considered whether to make an order under s 33 of Act, for the examination of Mr Waldron for the purpose of the Delaware Court proceedings. Again, the Court found that the Delaware Court proceedings did not relate, at least not in any direct sense, to the commission of an offence, although associated matters have involved such criminal proceedings in the United States and Australia: CSC No 2 at [13].

In CSC No 2, his Honour Black J considered in relation to Mr Waldron that (at [13]):

Section 3 of the Act provides that expressions used in it which are defined in the Evidence Act 1995 (NSW) have the meanings set out in that Act. In Pt 1 of the dictionary to the Evidence Act, “offence” is defined as “an offence against or arising under an Australian law”.

By application of that definition, the term “offence” in s 32(2) of the Act means “an offence against or arising under an Australian law”.

Even if the Court was to conclude that the SEC proceedings were related to the commission of “an offence or an alleged offence”, (which, with respect, is not a finding open to be made by this Court) on a plain reading of the Act, s 32(2) does not bear upon the present proceedings. That is, the only offences or contraventions of law to which the US proceedings could relate, are contraventions of American laws, not Australian criminal law.

The SEC does not seek orders to permit the USAO to examine the Witnesses.

In the US proceedings, the SEC must meet a burden of showing a violation of the Securities Act and/or Exchange Act happened by a “preponderance of the evidence”. This standard is less than the criminal standard of “beyond a reasonable doubt”. It is a civil standard of proof.

In BAT, the Court did not consider the issue as to whether the proceedings related to the commission of an “offence” for the purposes of the Act. However, the Court did make orders for the examination of the relevant witness in circumstances where the plaintiff in the foreign proceedings was the State and the relief sought included a judicial order preventing and restraining certain unlawful conduct.

In CSC No 1, that the civil standard of proof applied was an important factor that the Court considered when determining that the Delaware Court proceedings did not relate to the commission of an offence for the purposes of the Act: at [51].

The US proceedings constitute a civil proceeding, not a criminal proceeding, because:

As in Sykes, success by the plaintiff, the SEC, could not establish the commission of an offence, so as to expose anyone to criminal sanction, because the case would be conducted without the standard of proof and rules of procedure characteristic of criminal proceedings: Sykes at [10].

The expression “proceedings relating to the commission of an offence” in s 32(2) of the Act means criminal proceedings: Sykes at [22]. The terms of s 32(2) must take their colour from their context. The section 32(2) “carve out” is therefore intended to relate to criminal proceedings. Such an approach accords with the policy of the both the Hague Convention and the Act, which encourages international assistance in matters which are not criminal: Sykes at [22]-[24].

This is consistent with the criminal/civil distinction taken in the Second Reading speech to the Evidence (Amendment) Act 1990 (Vic), the Victorian equivalent to the NSW Act (and identical to that Act) which amended the Evidence (Miscellaneous Provisions) Act 1958 (Vic). The Hon BW Mier (Minister of Consumer Affairs), stated:

The SEC seeks civil penalties as against Mr Pulier. These are akin to civil penalty orders sought by the Australian Competition and Consumer Commission and Australian Securities and Investments Commission in Australia.

The fact that the SEC is seeking civil penalty remedies does not mean that the US proceedings relate to the commission of an “offence” for the purposes of the Act.

In BAT, the United States of America sought damages and injunctive declaratory relief for alleged violations of racketeering laws. Despite this, the Court did not conclude that the relevant foreign proceedings related to the commission of an offence for the purposes of the Act.

Further, in Sykes at [14], this Court accepted that the plaintiff, by seeking treble damages, was seeking damages of a kind that were penal rather than simply compensatory, and cited John Robinson and Co Ltd v Ferguson Transformers Pty Ltd (1973) 129 CLR 65. Despite coming to this conclusion, the Court did not conclude that the relevant foreign proceedings related to the commission of an offence for the purposes of the Act: Sykes at [21]

Consistent with these previous authorities, the fact that civil penalty remedies are sought by the SEC in the US proceedings is not a decisive factor in determining whether or not the US proceedings relates to the commission of an “offence” for the purposes of the Act.

Mr Waldron submitted that the provisions of s 32(2) were engaged with respect to the present application.

Two primary submissions were advanced in that respect.

First, it was contended in written submissions that the request was for assistance in a criminal matter. However, it was later submitted that the US proceedings related to the commission of a crime.

Secondly, and accordingly, it was submitted the request was caught by the provisions of s 32(2) as, in any event, the expression “proceedings relating to the commission of an offence or an alleged offence” (“the expression”) has a wider meaning that “criminal proceedings” and the application falls within that wide meaning.

The definition of “proceedings” in s 31 does not apply to that word when used in s 32(2) such that the word proceeding receives its means from the words following in the subsection. Those words are equivalent to those found in the definition of “proceedings”, para (b) in s 31. In particular, the definition of “proceedings” in s 31, para (b) is not narrower than the expression in s 32(2). Whilst the words “in or before a count” appear in s 31(b), s 32(1)(b) concerns proceedings which have been instituted before a requesting court.

The proceedings referred to in para (b) of the definition are not necessarily disjunctive of that found in (a). Civil proceedings might relate to the commission of an offence. The definition in para (b) concerns matters have a punitive character. Civil penalty proceedings may in this day and age, be part of the enforcement of the criminal law. An example is the Proceeds of Crime Act 2002 (Cth). The distinction between civil and criminal is not binary.

If the Court were to accept civil proceedings are caught by the carve out in s 32(2), then the Court would not have jurisdiction in the present case.

The expression has a wider meaning because:

The judgments in Sykes, CSC No 1 and CSC No 2 are distinguishable from the present matter because:

The SEC’s reliance upon a Second Reading speech in Victoria is not available under the canons of statutory construction.

In response to the submission of the SEC as to the meaning of the expression offence, Mr Waldron submitted:

The US proceedings are caught by s 32(2) because:

When comparison is given to the indictment it is really criminal conduct which is alleged against Mr Pulier in both proceedings.

Proceedings for recovery of a pecuniary penalty are not a prerequisite for the recovery of a civil penalty and may, in any event, be of a civil nature and relate to the commission of an offence.

The applicant seeks orders under s 32 of the Act, giving effect to Letters of Request issued by the US Court; the effect of which would be for the issuance of a subpoena directing the Witnesses to attend at a place to give evidence for the purposes of the US proceedings.

The term “proceedings” is defined in s 31 of the Act, as Hidden J described the definition in Sykes (at [17]), “exhaustively, so as to include ‘any civil or commercial matter’ and proceedings ‘in relation to the commission of an offence or alleged offence’”. As his Honour remarked at [16], the provisions of Pt 4 stand in contrast to English legislation passed pursuant to the Hague Convention which limit the scope of the Evidence (Proceedings in Other Jurisdictions) Act to the taking of evidence “for the purposes of civil proceedings” (civil proceedings having been defined as “proceedings in any civil or commercial matter” in the requesting court).

Section 33(1) is expressed to confer a power on this Court with respect to examination only insofar as the application is “made under s 32”. By s 32(2), the jurisdiction of the Court is constrained by an express limitation of the application of Pt 4 of the Act – Hidden J in Sykes, adopted the language of senior counsel in the matter, which described the provision as a “carve-out”. It does not necessarily follow, however, that the use of the term “proceedings” in s 32(2) imports the definition in s 31 of the Act.

As McHugh J observed in Kelly v The Queen (2004) 218 CLR 216; [2004] HCA 12 at [103], “the functions of a definition is not to enact substantive law” (see Gibb v Federal Commission of Taxation (1966) 118 CLR 628 at 635; [1966] HCA 74). Statutory definitions are subject to qualification where a definition is used in a context which renders the definition inapplicable (see s 5(2) of the Interpretation Act and Council of the Law Society of New South Wales v Bouzanis (2017) NSWLR 488; [2017] NSWCA 330 at [45] (per Basten JA)), such that the definition may be excluded by implication: Tovir Investments Pty Ltd v Waverly Council [2014] NSWCA 379 (“Tovir”) at [17] (per Basten JA), when a contrary statutory intention is apparent: Tjungarrayi v Western Australia (2018) 266 ALR 603; [2019] HCA 12 at [89] (per Nettle J). There is no simple formula for determining what is a contrary intention: Deputy Commissioner of Taxation v Mutton (1988) 12 NSWLR 104 at 108 (per Mahoney JA). However, the ease or difficulty of fitting a definition into a particular operative provision may be a primary basis for deciding whether a definition should be excluded by implication; although “one is likely to require some understanding of the meaning of the definition itself”: Tovir at [17].

With those principles in mind, I accept the submissions of senior counsel for Mr Pulier that the “generic definition of” proceedings in s 31 should not be applied to the concept in s 32(2), such that the definition is excluded by implication, essentially because of the difficulty of fitting the definition into the provision.

The primary bases for that submission may also be accepted:

In Sykes, Hidden J identified the long standing principle that domestic courts will not entertain an action for enforcement, either directly or indirectly of a “penal, revenue or other public law” of a foreign state at [18] (see Attorney-General (United Kingdom) v Heinemann Publishes Pty Ltd (1988) 165 CLR 30 at 40-41).

His Honour was concerned, in that respect, with the provision for treble damages in the Wisconsin proceedings, which his Honour described as “penal, rather than simply compensatory” (Sykes at [14]) in circumstances where it was argued that the taking of evidence for the applicant would amount to “a step, albeit indirect, in the enforcement of a penal law of the United States” (Sykes at [19]).

It is true, as submitted by Mr Waldron, that part of his Honour’s rejection of that conclusion was that the Wisconsin proceedings were not public proceedings of the kind described in Hunington v Attrill [1893] AC 150 (“Hunington”) (at 156) (although as Keane J observed in Commonwealth of Australia v Director, Fair Work Building Industry Inspectorate [2015] HCA 46 (“Fair Work Building”) at [93], the fact a plaintiff seeking a civil penalty is an agent of the State does not alter the essential nature of the proceedings as civil in nature). However, that submission fails to give recognition to the fact that his Honour’s conclusion that the expression “proceedings relates to the commission of an offence” (at [22]) (where his Honour concluded that the exclusion meant “criminal proceedings”) revolved significantly around his conclusion at [23], namely, in summary:

Hidden J concluded that the expression “proceedings relating to the commission of an offence” meant “criminal proceedings” that is “proceedings having as their focus the determination whether an offence has been proved and, if so, what the appropriate punishment (if any) should be”.

I agree, with respect, with those conclusions of Hidden J. There is, in my view, no relevant distinction between the subject matter of the Wisconsin proceedings for treble damages and civil penalties sought in the US proceedings. Further, as to Huntington, it may be noted that the application presently before the Court seeks orders which are confined to the seeking of evidence for use at trial in the US proceedings.

Further, I agree with the submission of Mr D Tynan, who appeared for the SEC, that the treatment of the “carve-out” provision, insofar as it refers to the commission of an offence, as meaning criminal proceedings (as defined by Hidden J), accords with the policy of both the Hague Convention and the Act (the definition in s 31 itself recognises a distinction between civil and commercial matters in s 31(a) and the commission of an offence), which encourages international assistance in matters which are not criminal.

Further, to the extent that use of the terms “offence” or “commission of an offence” is ambiguous, in construing domestic legislation that is ambiguous (in that it is capable of being given a meaning which either is consistent with or is in conflict with a treaty obligation), there is a presumption that Parliament intended to legislate in conformity with the treaty obligation: Dietrich v The Queen at 306.

The Hague Convention states, at Article 1:

On that basis the term “offence” should therefore be read not to include any civil or commercial “offences” and instead be taken to mean only criminal “offences”.

I interpose here to note the SEC also contended that any offence the subject of the US proceedings was not an offence against or arising out of an Australian Law; relying in that respect, as earlier mentioned upon the definition of offence in Pt 1 of the Evidence Act and the Act (see s 3).

I reject that submission, in substance, upon the bases advanced by Mr Waldron as summarised at [172(1)]-[172(3)].

The distinction between criminal proceedings and civil penalty proceedings was dealt with in Fair Work Building in the judgment of French CJ, Kiefel, Bell, Nettle and Gordon JJ as follows (at [51]-[58]):

That distinction is not overcome, as Mr Lange suggested, because the “public interest” nature of the US proceedings related to the commission of an offence. That submission, so far as it concerns civil penalty proceedings, should be rejected, particularly in the light of the observations of the plurality in Fair Work Building (at [59]):

It is true that the legislature did not use the expression “criminal proceedings” in s 32(2); an expression which is found elsewhere in the Act in ss 11 and 25. However, that does not, in my view, alter the above construction of the provision, to which I prefer, for three reasons:

The foregoing construction of s 32(2) nonetheless leaves open the question as to whether the US proceedings are proceedings relating to the commission of an offence. Senior counsel for Mr Pulier submitted that the connector “relating to” is not as “tight” as presented by the SEC “and may incorporate civil proceedings”, so far as the proceedings seek to enforce a penal judgment in those proceedings. Reliance, in that respect, was placed upon the definition of a criminal matter in the Mutual Assistance in Criminal Matters Act 1987 (Cth) (“MACM Act”).

I do not consider the MACM Act assists Ms Younan SC in this respect as the definition of criminal matters in that Act concerns the imposition of a pecuniary penalty for an offence. Further, the MACM Act lacks application in the present context for the reasons provided below.

In any event, Mr Younan SC did not contend that more expansive construction of the operation s 32(2) would, on the evidence and submissions in this matter, alter Mr Pulier’s submission that the carve-out in s 32(2) did not apply to the present application given the nature of the US proceedings.

That submission may be accepted as may the further submissions by Mr Pulier that the characterisation of the US proceedings as proceedings in the public interest to obtain civil penalties, as discussed above, do not qualify the US proceedings as being proceedings relating to the commission of an offence or any illegal offence. I accept that the connector “relating to” in s 32(2), even though very wide in its application does not permit the acceptance of a submission by Mr Waldron which, as submitted by senior counsel for Mr Pulier, “elides any effective distinction between civil and criminal matters”, given that on the evidence, the US proceedings are civil proceedings. This brings to consideration a further submission advanced by Mr Waldron.

The thrust of Mr Waldron’s submissions were that, because Title 15 of the US Code contains a number of offence provisions (which are, in fact, unrelated to the US proceedings) and provisions which allow the SEC to compel the production of witnesses and documents in the course of SEC investigations which have penal sanctions for non-compliance, the US proceedings are, in substance, “proceedings relating to the commission of an offence or an alleged offence” within the meaning of s 32(2) of the Act. I reject those submissions.

In the first Miller affidavit, Mr Miller who has the relevant knowledge and expertise to give evidence to this Court as to the operation and effect of US Federal law, deposed that the US proceedings were civil proceedings.

I accept the submission for the SEC that, on the basis of Mr Miller’s evidence, that the US proceedings are civil proceedings because:

Further, the “proceeding” for the purposes of s 32(2) of the Act must be understood as being limited to a consideration of the actual proceeding on foot in the foreign jurisdiction, namely, a civil proceeding. Considerations such as other powers contained in, for example, Title 15 of the US Code that are not relevant to the US proceedings, are not relevant to the assessment of whether the “proceedings” are civil or criminal.

The SEC provided an analogy which is useful. The Competition and Consumer Act 2010 (Cth) (“CCA”) contains separate civil and criminal prohibitions for cartel conduct: see, for example, s 45AJ is a civil penalty provision. It prohibits the making of a contract containing a cartel provision. Section 45AF is an offence provision. It prohibits the making of a contract containing a cartel provision. The fact that the CCA contains an offence provision (s 45AF) for similar conduct does not render civil proceedings for a contravention of s 45AJ as “proceedings relating to the commission of an offence or an alleged offence”. Likewise, the Australian Competition and Consumer Commission (“ACCC”) has coercive investigatory powers pursuant to s 155 of the CCA to require the production of witnesses and documents, which the ACCC may utilise in civil proceedings. Non-compliance with s 155 is a criminal offence: ss 155(5) and (6A). The fact that non-compliance with s 155 is a criminal offence, does not render any subsequent civil proceedings brought by the ACCC as being related to the commission of an offence.

I conclude, therefore, that the expression “proceedings relating to the commission of an offence or an alleged offence” in s 32(2) of the Act, means criminal proceedings. I accept the submission by the SEC that it would strain the statutory language impermissibly to suggest that, because Title 15 of the US Code contains offence provisions unrelated to the US proceedings and coercive powers (which, in fact, have not been exercised by the SEC in the US proceedings: see the third Miller affidavit), that the US proceedings could be characterised as relating to the commission of an offence.

I also accept the submission of the SEC that, if Mr Waldron’s submissions (that the US proceedings relate to the commission of an offence) were accepted then non-compliance with a subpoena on pain of criminal contempt in any private law proceedings would render the characterisation of all such proceedings as ‘proceedings relating to the commission of an offence or an alleged offence.’

In the circumstances, I do not consider that the US proceedings are proceedings relating to the commission of an offence or an alleged offence upon the construction of s 32 undertaken above.

It follows, in my view, that the provisions of s 32(2) do not apply to the US proceedings and the Court has, thereby, the jurisdiction to hear the application and motion.

Mr Waldron submitted that the Court must refer the matter to the Commonwealth Attorney-General. This was a further submission given to the Court’s jurisdiction.

Mr Waldron submitted as follows:

Having regard to the submissions of the SEC, those submissions should be rejected for the following reasons:

I will commence this consideration by reviewing some foundational requirements of s 33(1), which, in my view, have been met by the SEC in this case.

The obtaining of the evidence is for the purposes of the US proceedings and is for the purpose of giving effect to the requests of the US Court. Having regard to my earlier discussion of the evidence sought to be obtained and its relevance, the evidence to which the application relates is directly relevant to the legal claims and factual allegations at issue in the US proceedings.

The evidence permitted to be obtained under the Act in compliance with a request by a requesting court in a foreign country is restricted to evidence for use in a trial, thereby excluding the obtaining of evidence which might lead to the procurement of evidence: BAT at [22] and [45].

Oral examinations that are for the purpose of obtaining evidence for the trial, as distinct from obtaining information, will fall within the ambit of the Act for the collection of “evidence”: BAT at [40]; CSC No 1 at [52].

The purpose of the examinations of the Witnesses is not to obtain information. The purpose of the examinations of the Witnesses is to obtain evidence for use at trial in the US proceedings. In this regard:

I accept the submission advanced by the SEC that the taking of evidence at this stage of the US proceedings is not premature because:

The orders in the summons all relate to steps that this Court would be able to require or would generally be made in respect of local proceedings: see s 34(4).

Each of the Letters of Request contains a list of “topics for examination”.

In this way, each Letter of Request complies with the subject matter approach adopted under Article 3(f) of the Hague Convention, namely, the questions to be put to the persons to be examined or a statement of the subject-matter about which they are to be examined.

There is, in my view, ample basis for the Court to make, in its discretion, the orders proposed in the short minutes (with some minor amendments) in the present case. I note, in that respect, my conclusions under s 32(2) and the preceding additional considerations with respect to the operation of s 33. Some particular considerations arise in the case of Mr Waldron. I will return to those discretionary considerations separately under the next heading.

The parties agreed that, whether to allow the examination of Mr Waldron pursuant to s 33 of the Act, is a matter for the Court’s discretion: see CSC No 2 at [7], citing with approval BAT. Notwithstanding this concurrence, and whilst the SEC and Mr Waldron each referred to the decision of the High Court in X7, the critical difference between them was as to the priority given to considerations arising in the content of the judgment in X7, in the context of the Court determining whether to exercise its discretion pursuant to s 33 of the Act.

Mr Waldron opposed the Court granting an order allowing the examination of him, submitting that Mr Waldron submitted that if he were to be compulsory examined, for the purposes of the US proceedings, it would constitute a fundamental alteration of the process of criminal justice. Such an examination would require him to answer questions relating to the subject matter relevant to offences for which he is currently being prosecuted in NSW criminal proceedings and, therefore, represent obvious prejudice: X7 at [124] (per Hayne and Bell JJ, with Kiefel J agreeing).

The “likely overlap between the topics” of the proposed examination and Mr Waldron’s criminal trial was a central factor in the decision Court’s decision in CSC No 2.

Justice Black, in CSC No 2 at [29], concluded that an alteration of the fundamental nature of the criminal process would arise if an examination of Mr Waldron preceded his criminal trial. His Honour was consequently not satisfied that the Court should exercise its discretion, pursuant to s 33 of the Act, to allow the examination of Mr Waldron.

Mr Waldron submitted that given the clear overlap between the allegations made against Mr Waldron in the NSW criminal proceedings and those about which he will be questioned in the US proceedings, the present proceedings are in no different position to those in CSC No 2. The Court, in the present proceedings, should, therefore, reach the same determination as Black J in CSC No 2 and exercise its discretion to refuse the examination with respect to Mr Waldron.

Mr Waldron submitted that it is the proposed compulsory examination prior to his criminal trial that would constitute a fundamental alteration of the nature of the process of criminal justice. The rationale for this submission was that it would infringe upon Mr Waldron’s common law rights, as an individual facing a criminal trial, such as the privilege against self-incrimination. Thus, the Court should not allow permit the SEC’s application.

Mr Waldron submitted that the legislature was capable of fundamentally altering the process of criminal justice. However, to do so, the trenching of rights can only be affected by statute if the legislative intention is made clear by express words or necessary intendment: X7 at [71] and [119]. Mr Waldron submitted that, the words contained in s 33 are expressed generally and, therefore, the Act did not operate to abrogate the common law rights of an accused in criminal proceedings.

If correct, it follows that an accused’s privilege against self-incrimination is not disturbed so that the Court is not empowered by the Act to allow the compulsory examination of Mr Waldron.

Lastly, Mr Waldron submitted that the submissions of the SEC, to which I will turn below, misunderstand the impact of, and misapply, the decision in X7.

The SEC contended that the Mr Waldron’s impending criminal trial, even with due consideration of X7, did not operate as to bar the Court from ordering his examination.

The SEC submitted that Mr Waldron’s criminal trial is just one factor for the Court to consider in balancing all relevant factors in a given case to determine whether to exercise its discretion under s 33 of the Act.

In considering the implications of X7, SEC submitted that it is necessary to have regard the character of the examination that was under challenge in that case and the statutory scheme: Lee v NSW Crime Commission (2013) 251 CLR 196 (“Lee”) at [47] (per French CJ).

SEC contended that X7 does not stand as authority for the proposition that legislation will never be construed to permit the compulsory examination of persons charged with offences or who are suspects in investigations. Rather, each case will turn on the interpretation of the relevant statutory provision: Lee at [3].

The SEC submitted that, in X7, the High Court considered the question of whether a compulsory civil examination (that involved the likely overlap of subject matter) of an accused prior to a criminal trial was permitted, either expressly or by necessary intendment, by the provisions of the Australian Crime Commission Act 2002 (Cth) (“ACC Act”). The SEC submitted that the High Court found that the words contained in the ACC Act were sufficiently general to encompass the circumstances of the case, but they did not deal directly or expressly with such a situation. The High Court, by majority, (Hayne and Bell J, Kiefel J agreeing) held that the relevant provisions of the ACC Act did not empower an examination of a person charged with an indictable offence.

The SEC submitted that a key aspect of the majority’s reasoning was the fact that the ACC was only empowered to exercise its examination powers, in the context of the case, in relation to a “special investigation”, which could only be undertaken where the Board of the Australian Crime Commission (“ACC”) first considered “whether ordinary police methods of investigation into the matters are likely to be effective”. In the context of the ACC Act, “effective” could be understood as meaning “effective to permit the laying of charges against offenders”. As such, the ACC Act did not necessarily imply that the extraordinary power of compulsory examination could be used after the laying of charges.

The SEC submitted that, in CSC No 2, Black J determined that the Court should not exercise its discretion to allow an examination of Mr Waldron to proceed prior to his criminal trial. Among his Honour’s reasons for so deciding, Black J held that there was a substantial likelihood that an examination of Mr Waldron prior to his criminal trial would alter the fundamental nature of the criminal process, relying on the High Court’s decision in X7: CSC No 2 at [29].

The SEC submitted that, in the present application, the Court should not simply conclude that, because Mr Waldron faces a criminal trial in New South Wales, the X7 principle is automatically enlivened. The scope of the Court’s power to conduct examinations and the use that may be made of evidence is critical to the exercise of the Court’s discretion to allow the examination of Mr Waldron.

The SEC submitted, in support of that submission, the following:

The SEC submitted that, in CSC No 2, Black J also had regard to the following matters in refusing the application pursuant to s 33 of the Act:

The SEC contended that the present proceedings differ from CSC for the following reasons:

Mr Waldron submitted that the Court, if all of Mr Waldron’s above arguments are rejected, should, nevertheless, in its discretion, refuse to give effect to the letter of request. In the affidavits of Mr Gibson sworn 1 and 25 September 2020, Mr Waldron’s solicitor indicated that the criminal trial against Mr Waldron commences on 26 October 2020. It is estimated that the trial will run until the end of 2020 and the brief of evidence is voluminous, encompassing some 54 volumes of evidence.

Mr Waldron submitted that to require him to attend a compulsory examination so soon before his criminal trial would be oppressive: Restricted Decision [2016] NSWCA 103 (“Restricted Decision No 2”) (at [116] per Beazley P). Mr Waldron submitted that those comments of Beazley P apply with equal vigour to Mr Waldron. Further, given the seriousness of the criminal trial, the considerable preparation required, and its imminence, Mr Waldron submitted the Court should the decline to issue the subpoena.

SEC submitted that provided the Court is satisfied of the matters in s 32 of the Act, the Court has a broad discretion under s 33 of the Act “to make such provision for obtaining evidence in the State as may appear to the Court to be appropriate for the purpose of giving effect to the request in pursuance of which the application is made”: see BAT at [42] and Pickles v Gratzon (2002) 55 NSWLR 533; [2002] NSWSC 688 at [80]. See also: CSC No 2 at [7].

The SEC submitted that, in determining whether to give effect to an application under s 32, by orders under s 33, Spigelman CJ in BAT considered that the Court should apply the factors summarised in Gredd at [27]. This is particularly so where an application is disputed, in which case, the Court must determine whether the order sought is one which it can and should properly make.

The SEC contended that, notwithstanding the possibility of a party’s exposure to civil or criminal proceedings, the Court is entitled to exercise this discretion: BAT at [98]. This is premised on the notion that s 34 of the Act contains a comprehensive regime to protect the privilege of witnesses and that it is intended to operate in accordance with its terms.

In further support of that argument, SEC submitted that s 34 of the Act would preserve Mr Waldron’s privileges against self‑incrimination and also legal professional privilege. Thus, the SEC submitted that s 34 provides a relevant protection to Mr Waldron, enabling him to assert his privilege against self‑incrimination if he was ordered to attend a compulsory examination.

The SEC submitted that the following matters, set out in Gredd, point in favour of granting the application in respect of Mr Waldron:

As to Mr Waldron’s submission, in reliance on Restricted Decision No 2, the SEC submitted that the authority was not relevant to the Court determining whether to exercise its discretion under s 33 of the Act with respect to Mr Waldron. The circumstances of that case arose in circumstances where the Commissioner of the Australian Federal Police (“the Commissioner”) sought to examine individuals as to the affairs of two persons pursuant to the specific legislative framework of the Proceeds of Crime Act.

The SEC submitted that both the primary judge and the Court of Appeal considered the following as significant factors in the exercise of the Court’s discretion to postpone the examination, which do not apply to the present proceeding:

The SEC submitted that Button J also considered the “imminence” of the criminal trial and likely disruption to trial preparation caused by the examination to be one of the least significant reasons before the Court regarding its consideration of whether to stay the examinations (reason 14 of 15): Restricted Decision No 2 at [37]-[38], referring to the primary decision, Restricted Decision [2015] NSWSC 888 (“Restricted Decision No 1”) at [42].

The SEC submitted that the examination of Mr Waldron is likely to occasion limited prejudice to him in the preparation of his criminal trial. In SEC No 1, in respect of the hearing of the present proceedings, Wright J at [26] stated:

The SEC submitted that there are a number of other considerations that ought to be considered by the Court in favour of granting the order against Mr Waldron. The first of those was stated in the second Miller affidavit at para 10, extracted below:

As earlier mentioned, the SEC submitted that a second consideration, contended to be different from the facts and circumstances in CSC No 2, is that the trial in the US proceedings will occur after Mr Waldron’s criminal trial. The US Proceedings are listed in April 2021. The effect of that submission being that any evidence or refusal to give evidence in the course of the examination will not be adduced in the US proceedings until after Mr Waldron’s criminal trial in New South Wales is completed.

The Court, following the hearing, requested the assistance of counsel in respect of the following question:

Mr Waldron’s principally submitted that s 128 of the Evidence Act would not apply to his compulsory examination as it would not be conducted by a “NSW Court”: s 4 of the Evidence Act.

Paragraph 3 of the Short Minutes seeks:

The “Examinations” would not constitute “proceedings in a NSW court”. Therefore, the Evidence Act, wholly does not apply: Wright v Clarkson [2000] NSWSC 669 at [7] (Hidden J). His Honour at [7] stated that the Evidence Act, including the provision for the protection of a witness from self-incrimination in s 128, does not apply to an inquest. See also: Decker v State Coroner of NSW [1999] NSWSC 369 at [22].

Even if Mr Waldron was examined by a judge of the Court, the examination would not be proceedings in a NSW court.

Thus, Mr Waldron submitted that s 128 of the Evidence Act is not applicable to him. If it was, even then, the obviation of prejudice against Mr Waldron is not achieved: X7 at [124].

Mr Waldron further submitted that, even if s 128 of the Evidence Act was applicable, a question arises as to whether the Court could compel Mr Waldron to give evidence in light of s 128(4)(a) of the Evidence Act, because of the possibility that the evidence may tend to prove that Mr Waldron has committed an offence against or arising under or is liable to a civil penalty under a law of a foreign country. An application to call further evidence was made by Mr Waldron.

Conversely, as to s 128(4) of the Evidence Act, the SEC submitted that if the Court is satisfied that one of the matters in s 128(4)(a) is established (that is, that the evidence does not tend to prove that the witness has either: committed an offence against or arising under a law of a foreign country; or is liable to a civil penalty under a law of a foreign country), the Court cannot require Mr Waldron to give evidence upon the issuance of a certificate under s 128(5) of the Act.

In respect of s 128(4)(a), the SEC submitted for the following reasons that Mr Waldron’s evidence does not tend to prove that he has committed an offence against or arising under a law of a foreign country or tend to prove that he is liable to a civil penalty under a law of a foreign country.

First, Mr Waldron is not presently subject to any criminal proceedings or civil penalty proceedings in the United States regarding the matters the subject of the US proceedings.

Secondly, there is no evidence before the Court as to how Mr Waldron’s evidence could tend to prove that he has committed an offence against or arising under a law of a foreign country or be liable to a civil penalty under a law of a foreign country.

A tendency to expose to self-incrimination may be obvious or sufficiently discernible in some cases. For example, where a witness admits to having committed an assault, it may be readily apparent that they have violated a foreign law.

In other cases, in the absence of specific evidence as to the operation and elements of the foreign laws in question, it may not be at all apparent that the particular evidence to be given by a witness is capable of satisfying the statutory requirement in s 128(4)(a) of the Evidence Act, for example, establishing to the requisite standard the physical and mental elements of a foreign criminal securities offence.

In such cases, there must be a rational basis to conclude that the link between the particular evidence to be given by a witness and the elements of the foreign offence or civil penalty would tend to prove that the witness has committed an offence against or arising under a law of a foreign country or that they are liable to a civil penalty under a law of a foreign country. Further, the statutory requirement that the evidence given by a witness would “tend to prove” a foreign offence, in the sense that the particular evidence is likely to prove the offence to the criminal standard (beyond reasonable doubt) would appear to be a high threshold.

It is not apparent at this stage that any evidence to be given by Mr Waldron will be capable of tending to prove he committed some foreign offence or violated some civil penalty provision.

Thirdly, the appropriate time for the determination of this issue (and accordingly whether the Court can compel Mr Waldron to give evidence), is at the time of Mr Waldron’s examination: see s 128(1) of the Evidence Act, which requires a witness to object “to giving particular evidence”.

In respect of s 128(4)(b) of the Evidence Act, there is no presumption as to what the interests of justice require. The test is not to be approached on the assumption that the privilege against self-incrimination is “fundamental” and that it would be rare to require a person who satisfies the test under s 128(2) to give evidence (Australian Workers' Union v Registered Organisations Commissioner (No 7) [2019] FCA 195 at [32]–[33]). Likewise, it would be wrong to assume that the protections conferred under s 128(7) create a presumption that the interests of justice will require the person to give the evidence. Each case must be assessed on its merits.

The SEC submitted that it is in the interests of justice that Mr Waldron give this evidence during the examination.

The US proceedings are directed at determining whether Mr Pulier acted contrary to provisions of regulatory legislation. Mr Waldron is a central witness to the SEC’s case. He “possesses information that is relevant and essential” to the US proceedings: R v Lodhi (2006) 199 FLR 328 at [41]–[46].

It is clear that the Court has a broad discretion whether or not an order under s 33 of the Act may be made, which requires the Court to determine whether it is satisfied of the matters set out in s 32 of the Act and, if so, whether an order should be made under s 33 of the Act: BAT at [14]. In determining whether an order should be made, the Court may have regard to the factors summarised in Gredd at [27], and cited with approval by Spigelman CJ in BAT at [42].

In this matter particular attention was placed upon the applicability of the judgment of the High Court in X7 both as a bar to the examination of Mr Waldron or a powerful discretionary factor. It is to that consideration I will now further turn.

I have earlier summarised the submissions of the parties in this respect. As an introduction to this consideration I shall provide a brief overview without derogation from my earlier summary:

The submissions of the SEC, in essence, were:

In X7, Hayne and Bell JJ, with whom Kiefel J (as her Honour then was), addressed the question of a compulsory examination of an accused prior to a criminal trial.

In answer to that question, Hayne and Bell JJ broadly considered the nature of the process of criminal justice, stating at [97] that a criminal trial “is both accusatorial and adversarial”.

As to the adversarial nature of criminal trials, their Honours at [98] referred to the observations of Barwick CJ in Ratten v The Queen (1974) 131 CLR 510. The Chief Justice (at 517) said:

As to the accusatorial nature of criminal trials, their Honours continued (X7 at [99]):

Their Honours at [100] observed that “there are some features of criminal trial process which, although now considered to be fundamental, are of relatively recent origin”. For example, what “now are axiomatic principles about the burden and standard of proof in criminal trials” were not fully established until 1935: see Woolmington v Director of Public Prosecutions [1935] AC 462 at 481. A further noteworthy example, identified at [100] was that:

Hayne and Bell J at [101] stated:

In Reid v Howard (1995) 184 CLR 1 at 11 (Toohey, Gaudron, McHugh and Gummow JJ), the privilege against self-incrimination, described as “a ‘fundamental … bulwark of liberty’ is not simply a rule of evidence, but a basic and substantive common law right”. Their Honours stated that the “accusatorial process of criminal justice and the privilege against self-incrimination both reflect and assume the proposition that an accused person need never make any answer to any allegation of wrong-doing”.

Their Honours observed in X7 at [105] that an accused person’s “right to silence”:

As to whether the compulsory examination of Mr Waldron would fundamentally alter the process of criminal justice, by prejudicing his common law rights as an accused person, the observations of their Honour’s in X7 at [71] and [124] are apposite:

It must be recognised that the determinative question in this respect is – does the Act provide for the compulsory examination of an accused person about the subject matter of their pending criminal trial? That question is one statutory construction: X7 at [91].

It cannot be said that a statute can never effect fundamental alterations to the process of criminal justice. But such an alteration can only be made if it is made clearly by express words or necessary intendment: X7 at [119].

Indeed, in X7 their Honours said (at [121]):

In Strickland, the joint judgment of Kiefel CJ, Bell and Nettle JJ accepted that IBAC stood for the proposition that the common law right to silence was beside the point in circumstances where it was lawfully overridden by the examiner’s exercise of compulsive powers, under statute, for the purpose for which the statute provided: at [96].

X7 was referred to by the High Court in Strickland (at [76]) where the plurality considered that the observations of Hayne and Bell JJ in X7 had the following effect:

In Strickland, the High Court held that the powers of compulsory examination had been exercised unlawfully. Under the ACC Act, the power to conduct an examination is an ancillary power available to be used “for the purposes of a special ACC operation/investigation” (s 24A of the ACC Act). In the circumstances of that case, where the ACC did not, on its own behalf, conduct investigations into the relevant conduct but instead acted as a “facility” for the Australian Federal Police to cross-examine the appellants under oath for the Australia Federal Police’s own purposes, there was no “special ACC investigation” that would authorise an examination to take place: at [70].

The determinations to conduct the investigation were incapable in and of themselves of constituting a “special ACC investigation”, as the question of whether such an investigation was conducted was a question of fact and the availability of the examination power depended on the existence of an investigation of fact: at [71]. Moreover, the ACC Act could not be construed as authorising the ACC generally to lend its compulsory interrogation powers to the Australia Federal Police whenever the Australia Federal Police had under investigation a criminal offence listed in an ACC determination: at [73]. It followed that, since the examinations were not held for a permitted purpose, but rather for an extraneous, unlawful purpose of assisting the Australia Federal Police to compel the appellants to give answers to questions about offences of which they were suspected and had declined to be interviewed, the examinations were unlawful: at [74].

The SEC correctly submitted that the decision in Strickland turned upon the interpretation of the ACC Act, as well as the scrutiny of the particular circumstances of the case. However, that does not, in and of itself, and without more, assist the SEC as to their contention that the Act does operate to alter the fundamental nature of criminal justice, that is, override an accused’s right to invoke the privilege against self-incrimination prior to their criminal trial. Strickland merely reflects the principle espoused in X7, that the common law right to silence is capable of being “lawfully overridden” under statute. The question is whether the Act in Pt 4 so operates?

Subject to the operation of the Act, there can be little doubt that the principles applied in X7 intersect with the circumstances of the present application concerning Mr Waldron because:

In the last respect, having regard to the indictment in the criminal proceedings brought against Mr Waldron and the 9 examination topics detailed in the US Court Letter of Request Appendix A “Deposition Topics”, there can be no doubt there exists a significant overlap between the subject matter of the topics on which Mr Waldron will be questioned in the US proceedings and the allegations made against Mr Waldron’s in his criminal trial. In the US Court’s letter of request, with respect to Mr Waldron, Magistrate Judge Oliver at cl 8(a) states:

Nonetheless the parties’ submissions on this issue of construction were unclear. It is, however, pellucidly clear that they variously rely on ss 33 and 34 of the Act, and I will proceed upon that basis.

It was common ground that ss 33 and 34 of the Act do not expressly provide for of compulsory examination of an accused prior to a criminal trial such as may offset the common law right to invoke the privilege against self-incrimination. Thus, the question must be posed as to as to whether s 33 of the Act abrogates an accused’s common law rights, namely, privilege against self-incrimination, by necessary intendment.

It is ultimately unnecessary to finally resolve that question due to the conclusions I have come to as to the proper exercise of the Court’s discretion pursuant to s 33 of the Act with respect to the examination of Mr Waldron. I have also adopted that approach because the absence of sufficient development of the submissions by the parties on the issue. Nonetheless, four brief observations as to this issue may be made, which raise doubts that the Act does necessarily intend to abrogate or fundamentally alter “the accusatorial judicial process that begins with the laying of a charge and culminates in the accusatorial (and adversarial) trial in the courtroom” (X7 at [124]).

As earlier noted, first, it is important to observe that the Act does not provide expressly for such an interruption to the process of criminal justice by the compulsory examination of a person charged with an indictable offence.

Secondly, the applicable rule of construction recognises that legislation may necessarily imply that its provisions work some fundamental alteration to the general system of law, or the qualification of some fundamental right, even though the Act does not expressly provide for that effect: X7 at [142]. See also: Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission (2002) 213 CLR 543 at 553 [11], 559-560 [32], 562-563 [43]. Such an implication must be necessary, not just available or somehow thought to be desirable.

Thirdly, s 33 of the Act provides for the power to grant compulsory examination. It is within that provision where a carve-out pertaining to an accused’s common law rights prior to a criminal trial would be expected to appear. The generality of the provision, read in the context of Pt 4, does not, in my view, appear to necessarily imply any qualification to an accused’s common law right to invoke the privilege against self-incrimination. Indeed, it is conceivable that a contra indication exists under Pt 4 given that s 33(1) expressly states that the power under s 33(1) conferred upon the Court arises only “if application is made under section 32”, thereby incorporating the requirements of s 32(2) and a carve-out as to criminal proceedings.

The provisions of s 34 would not seem to demonstrate the “necessary intendment”.

The provision makes no express reference to the examination of a person who has been charged but not tried for an offence about the subject matter of the pending charge.

It was common ground that the provision addressed the privilege against self-incrimination. However, this protection may be compared to the provision of the relevant legislation in X7.

The power conferred on the examiner in X7 was to summon a person to appear before the examiner at an examination to give evidence. However, the legislation then under consideration provided that, if the person being examined claimed that an answer to a question asked might tend to incriminate that person or make him liable to a penalty, then subject to certain exceptions, the answer given was not admissible in evidence against the person in criminal proceedings (see X7 at [73]). A further provision also provided that the examiner could give a direction preventing or limiting the publication of evidence given before the examiner (at [74]).

Notwithstanding these limitations, the High Court held that, even if the answers given at compulsory examination could not be used directly or indirectly by those responsible for investigating and prosecuting matter, a requirement to give answers, after being charged, would still fundamentally alter the accusatorial judicial process (X7 at [124]).

A provision which prevents compulsion against privilege adds greater weight to the proposition advanced by Mr Waldron that the legislation intended not to interfere with fundamental aspects of an accusatorial and adversarial criminal trial.

Fourthly, I consider that the SEC’s reliance on IBAC and Helicopter Resources to be misplaced.

The SEC correctly submitted that, in IBAC, the High Court unanimously rejected an argument that the compulsory examination of a person who was suspected of a crime was impermissible because such an examination would effect a fundamental alteration to the process of criminal justice by requiring a person to assist in his or her own prosecution: at [30], [48]-[50].

It was correctly submitted that where compulsory powers were exercised lawfully in accordance with the statute under which they were conferred for the purpose for which they were conferred, the examiner was not prevented by the fundamental principle (that it is for the prosecution to prove the guilt of an accused person) or the companion rule (that an accused person cannot be required to testify to the commission of a charged offence) from compelling persons suspected of offences to answer questions concerning the offences of which they were suspected: IBAC at [48]-[50].

The SEC’s submission as to IBAC does, however, not advance its contentions in respect of this mater. The decision in IBAC simply rejected the proposition that the companion principle can be extended to individuals who are merely suspected of criminal wrongdoing, as opposed to those who have, in fact, been charged: IBAC (per French CJ, Kiefel, Bell, Keane, Nettle, and Gordon JJ) at [48]-[50]. There is no suggestion that Mr Waldron has not been charged to face a criminal trial. The companion principle therefore does apply to him. Nothing the High Court said in IBAC detracts from the decision in X7 in the context of these proceedings.

The SEC also relied upon the decision of the High Court (Kiefel CJ, Bell, Gageler, Keane, Nettle and Gordon JJ) in Helicopter Resources at [22]. It was contended, as a matter applicable to the present case, that the High Court in Helicopter Resources confirmed that Strickland was not authority for the proposition that:

The effect of SEC’s submission is, in my view, nebulous. In Helicopter Resources, their Honours (Keifel CJ, Bell, Gageler, Keane, Nettle and Gordon JJ) made clear at [2] that:

The High Court held that the companion principle was not invoked, since “the fact that an employee can be compelled to give evidence that may be treated as an admission against the employee’s employer does not mean that the employer is thus compelled in effect to give evidence or otherwise to assist the Crown in proof of its case: Helicopter Resources at [19].

Hence, Helicopter Resources concerns the position of compulsory examination of a third-party witness and not, Mr Waldron’s situation, a person charged with a criminal offence. As their Honours at [17] said:

It follows that the decision in Helicopter Resources does not qualify, nor detract from, the decision in X7 or apply to the present proceedings in relation to Mr Waldron.

I turn then to the other discretionary factors.

The Court recognises that the examination of Mr Waldron is important to SEC’s case in the US proceedings against Mr Pulier. This acts in favour of permitting the application with respect to Mr Waldron. Notwithstanding that consideration, on balance, there are numerous countervailing considerations that act against the Court exercising its discretion to allow the examination of Mr Waldron.

It is a significant consideration in the exercise of the Court’s discretion that Mr Waldron is the accused in a criminal trial which is yet to be heard. That consideration is influenced by the principles underpinning the judgment of the High Court in X7. Further, that factor is rendered particularly significant due to the seriousness of the offences for which Mr Waldron is charged – if convicted, he is liable to a term of imprisonment: X7 at [142].

I am cognisant of the decision of the Court in SEC No 1 at [26], that to require Mr Waldron to prepare and appear at an examination during the then six weeks before his trial commences was not oppressive. Conversely, in Restricted Decision No 1 and Restricted Decision No 2, the imminence of an accused trial was held to be a relevant, albeit less primary, discretionary factor. In the current context of the present proceedings, I too consider the imminence of Mr Waldron’s trial to be relevant factor in the consideration of the exercise of discretion. However, I accept that it is on the lower end on a scale of significance, which is comprised of various factors.

A further factor in favour of an exercise of discretion to refuse the application for examination with respect to Mr Waldron is the absence of utility that may be gained through his examination. In substance, if a compulsory order were to be made, it would amount to a futility owing to Mr Waldron’s right to invoke the privilege against self-incrimination.

The SEC properly accepted that s 34 protects the privilege against self-incrimination. Nonetheless, it was contended that, if Mr Waldron were to exercise the privilege against self-incrimination during examination, there still remains a “strategic utility” in him participating in the US proceedings. That is, even if Mr Waldron is unable or unwilling to answer questions posed in the examination pursuant to his privilege against self-incrimination (a position Mr Waldron has made clear in these proceedings), the SEC could still raise that occurrence in evidence in the US proceedings. Such an outcome would be relevant, it was contended, to the US Court’s determination of the facts and matters in the US proceedings as to whether the SEC has proven its case.

Mr Waldron proffered, as to the possible basis for the SEC seeking to establish utility in the examination orders (if the privilege against self-incrimination was invoked) that “one might well divine that it is an attempt [by SEC in the US proceedings] to avoid what we in this jurisdiction might term a Jones v Dunkel direction”. However, the rationale behind the SEC’s position was not made clear by the SEC in its submissions.

Further, the SEC submitted that there still may be some general, non-specific, non-incriminating questions that could be asked of Mr Waldron, although none were particularised. However, in my view, that submission illustrates, in substance, the absence of real utility in the grant of compulsory examination.

Overall, and without the benefit of sufficient explanation on behalf of the SEC, the rejoinder of the SEC as to the futility of the examination, rose no higher than mere speculation and rather underscores the absence of utility in the granting of compulsory examination.

The provisions of s 128 would seem to offer no solace to the SEC in this respect. This may be viewed through the prism of the question raised by the Court with the parties, after reserving its decision, as to the significance of s 128(4) to the potential grant of a certificate in Mr Waldron’s examinations.

The SEC responded as to s 128(4) of the Evidence Act as follows:

I will mention later the significance of s 128(4), but I propose to first deal with Mr Waldron’s response to the Court’s invitation to make submissions regarding the issue raised by the Court as to s 128(4) (although Mr Waldron’s submissions were wider). In that respect, there would appear to be substance in Mr Waldron’s submissions that s 128 would not apply having regard to the context of Mr Waldron’s examination although the SEC has not, as yet, responded in terms, to those submissions. Section 4(1) of the Evidence Act, relevantly provides:

In the Dictionary, “NSW court” is defined as follows:

Any questioning which may occur before an examiner is not a “proceedings in a NSW court”. It would not appear the examiner would be required to apply the laws of evidence, and therefore, s 4 of the Evidence Act could apply only if the questioning occurred in proceedings before the Court.

While the applicant is required to approach the Court to seek orders to compel the attendance of persons to give evidence, the process of the questioning of those persons cannot be described as being “proceedings” before the Court. This can be seen especially in the order originally sought by the applicant, namely, that Mr Sulan, a member of the NSW Bar, be appointed as the examiner and by the ultimate form of the order advanced by Mr Pulier.

The statutory language demonstrates that the questioning ought to be seen as being different from proceedings before the Supreme Court. Section 33(4) Evidence on Commission Act provides:

If the proposed questioning of persons were to be viewed as being part of proceedings in this Court, then this provision would be unnecessary. Thus, the powers available would be defined by virtue of the nature of the matter before the Court, being a proceeding before the Court.

In circumstances where there are no proceedings in a NSW court, s 128 does not apply: see example, Decker v State Coroner of NSW, cited with approval Wright v Clarkson at [7] per Hidden J. (The Coroner’s Court does not fit within the definition of “NSW court”, and accordingly the mechanism under s 128 was not available).

In such circumstances, the privilege against self-incrimination cannot, in the absence of statutory warrant, be abrogated, see Reid v Howard at [5]. Accordingly, the common law privilege would continue to apply, and Mr Waldron could not be compelled, contrary to his privilege against self-incrimination, to give evidence. Thus, as to the question of utility, there would be no certificate mechanism available, which would permit that prohibition to be overridden.

To the extent that Application concerning Section 80 of the Supreme Court Act and Sections 119 and 128 of the Evidence Act [2004] NSWSC 614 (Brownie AJ) stands for the contrary proposition, I note that his Honour was not, apparently, referred to the terms of s 4 of the Evidence Act. Nor does there appear to have been any argument advanced by any party that the Evidence Act would not apply.

Further, s 128 of the Evidence Act itself, tends to demonstrate that it does not apply to the present circumstances. The section distinguishes between proceedings before a NSW court and other inquiries. For example, 128(7) provides for a limitation on where compelled evidence may not be employed against the witness:

Thus, the Act appears to distinguish between proceedings in a NSW court and proceedings “before any person or body authorised by a law of this State…”. Whilst the examiner may fall into the latter category, the former would not seem to apply.

Further, the legislature referred to the person objecting being a “witness”. The term “witness” is defined by the Dictionary in the following terms: “‘witness’ includes the meaning given in cl 7 of Pt 2 of this Dictionary”. In turn, cl 7 provides:

It is true the definition is non-exclusive in the light of the word “includes”. However s 131A provides:

This provision was introduced by cl 63 of Sch 1 of the Evidence Amendment Act 2007 (NSW), because the law relating to privilege was seen as not applying to preliminary processes, but applied only to the adducing of evidence itself, see Esso Australia Resources Ltd v Commissioner of Taxation (1999) 201 CLR 49 at 55 [3] (per Gleeson CJ, Gaudron and Gummow JJ). Section 131A does not apply the word “witness”, but rather uses the expression “person is required by a disclosure requirement to give information”.

I accept the submission of Mr P D Lange, who appeared for Mr Waldron, that this statutory context supports a construction that a “witness” was a person from whom evidence was adduced in proceedings. Hence, even if the subpoena were to issue, Mr Waldron would not be a “witness”, who could take an objection under s 128.

I note that s 131A now extends the law on privilege to pre-trial processes.

Such a construction of s 128 of the Evidence Act is also supported by the mechanism by which the objection is considered. The objection is to be considered by “the court” (subs (2)). “The court” is to give the witness certain information (subs (3)). “The court” must give a certificate in certain circumstances (subs (5)). A construction of the provision whereby s 128 would operate, if the examination were conducted by a judge of the Court, but not if, as proposed, the examination were conducted by a member of the Bar is incongruous, if not absurd, as, the nature of the protection should be governed by the nature of the proceedings.

Further, and referring to s 128(4), there must be doubts that, irrespective of the above considerations, Mr Waldron could be compelled to give evidence in the light of that provision.

Section 128(4) provides:

It is true, as submitted by the SEC, that Mr Waldron is not presently subject to any criminal proceedings or any civil proceedings in the US regarding the matters raised in the US proceedings.

It is also true that Mr Waldron’s evidence does not presently establish whether evidence sought to be led would serve to prove that Mr Waldron had committed an offence against or arising under or was liable to a civil penalty under a law of a foreign country.

But I do not consider, in the circumstances, that Mr Waldron should be deprived of further opportunity to call evidence on these questions.

Whether or not the ultimate time to resolve the issues arising under s 128 of the Evidence Act is the time of examination (about which further submissions may be received), it is a consideration which in my view, should be considered in these proceedings, at least at a preliminary level, in order to consider the question of utility.

As to whether the Court considers it is not appropriate for the examination of Mr Waldron to occur prior to the conclusion of the NSW criminal proceedings, the SEC advanced two contentions.

Firstly, any prejudice to Mr Waldron that results from his examination occurring prior to the NSW criminal proceedings could be addressed by deferring the release of evidence from Mr Waldron’s examination until after his criminal trial has concluded.

Secondly, the Court has the power to make an order for Mr Waldron’s examination to occur at a later stage. Mr Waldron did not make submissions as to that possibility.

The first contention, that such a course would not occasion prejudice, is illusory and offers, in prospect, the fundamental alteration of the accusatorial judicial process: X7 at [124].

As to the second contention, the parties did not meaningfully address the issue.

The question as to whether the Court should permit the examination of Mr Waldron after the conclusion of the NSW criminal proceedings has a relationship to the debate regarding whether s 128, and, in particular, s 128(4) operated in relation to any examination of Mr Waldron.

The SEC asserted that, there is no evidence before the Court on that question but that is not, as I have mentioned, a satisfactory means of dealing with the issue particularly where I have determined that any examination of Mr Waldron must await his criminal trial. This Court would then have the opportunity of receiving further submissions as to the operation of s 128 generally.

Hence, the final determination of the issues with respect to the examination of Mr Waldron should, in my view, be held over until after the criminal trial.

Nothing in this conclusion should be taken in any way as reflecting upon the US proceedings which will proceed as a matter for the discretion of the US Court.

This question is presently superseded by my decision as to deferment. However I propose to make some brief observations on the topic.

The observations of Spigelman CJ in BAT at [88] makes clear that the Court must endeavour to mould an order which the Court believes to be an appropriate for the purpose of giving effect to the request. Thus, the Court may determine, and exclude, topics or questions that are inappropriate for the examination Mr Waldron because they overlap with his NSW criminal proceedings. The corollary being that, the Court may, and should, permit appropriate questions to be asked of Mr Waldron, so as to give effect the letter of request to the fullest extent possible: Re Westinghouse Electric Corporation Uranium Contract Litigation (at 654).

A question arises as a result of the observation of Spigelman CJ in BAT (at [88]). If the Court were to limit the examination of Mr Waldron solely to questions that did not overlap with the NSW criminal proceedings, what would the residue of possible questions are capable of being so characterised as gives effect to the letter of request?

Given the significant overlap between the US proceedings and the NSW criminal trial, it is likely that the possible questions that remain are would produce a paucity of information.

As mentioned, it has not been explained with any precision what residue of questions could be permitted consistently with protecting Mr Waldron’s right to invoke the privilege against self-incrimination in the criminal proceedings. What is clear is that the residue of the possible questions would be slim.

It follows that the distinction sought to be drawn by the SEC between the decision of Black J in CSC No 2 and the circumstances of this matter, is somewhat tenuous. Mr Waldron’s status as the central witness to the SEC’s case in the US proceedings, being a discretionary factor, is a relatively minor one when compared to the prospect of prejudicing Mr Waldron’s criminal trial. Similarly, the fact that the US proceedings concern the conduct of Mr Pulier, as opposed to Mr Waldron, himself, does not effect to distinguish the decision in CSC No 2, wherein Black J considered prejudice a central discretionary consideration in refusing Mr Waldron’s compulsory examination. That is, although Mr Waldron is not in the position of defending the US proceedings, unlike the circumstances in CSC No 2, he will nevertheless be prejudiced in the NSW criminal proceedings, if compelled to examination. Further, the breadth of the proposed topics for examination is not relevant to Court’s exercise of discretion. That is, considering slight differences in scope, as between the topics for examination in CSC No 2 and the present proceedings, without due attention to the overlap of subject matter when compared to the charges in the criminal proceedings does not relevantly distinguish the decision in CSC No 2. These differences in proposed examination topics are as to form, and to that end superficial. As previously mentioned, the subject matter in the US proceedings does significantly overlap with the criminal proceedings.

There are significant discretionary factors weighing against the making of orders in the short minutes of order against Mr Waldron. However, the final disposition of that question can await the receipt of further evidence and submissions of the character referred to under the heading “deferment” above.

In light of the current restrictions imposed as a result of the COVID-19 pandemic in Australia and the United States of America, the SEC seeks orders that the examinations be conducted by Audio-Visual Link.

Relevantly, due to travel restrictions into Australia and in the United States, the attorneys with carriage of the US proceedings are unable (or unlikely to be able) to appear at the examinations.

Further, the Witnesses have requested that the examinations take place by audio-visual link, to minimise the risk of transmission of the COVID-19 virus.

Considering this Court’s current policy as to remote hearings and applications, the SEC submits that by analogy, orders for the conduct of the examinations before the examiner by audio-visual link are appropriate.

It is appropriate orders be made for examination via audio visual link as proposed in the short minutes, pursuant to s 33(1) of the Evidence (Audio and Audio Visual Links) Act 1998 (NSW) and r 31.3(1) of the Uniform Civil Procedure Rules 2005 (NSW).