In the matter of Timor Sea Oil & Gas Australia Pty Ltd (in liq)

These are my reasons for rejecting the Commonwealth’s application, late yesterday afternoon, that paragraphs 30-34 of the affidavit of Ms Leonie McGregor, First Assistant Secretary, Cabinet Division, be read in support of its claim of public interest immunity without being provided in any form or subject to any terms as to confidentiality to any of the lawyers for the plaintiff.

I gave a short summary of my reasons for making an order pursuant to the Court Suppression and Non-publication Orders Act 2010 (NSW) limiting access to those paragraphs to Mr Ian Jackman of Senior Counsel and Ms Colleen Platford, partner of the firm retained by the plaintiff, but reserved giving formal reasons. I took that course because the ruling was made at around 4.20pm, because I was conscious of the possibility of an urgent application for leave to appeal and because it was inevitable given how the Commonwealth’s claim for public interest immunity had been advanced that the hearing could not in any event be completed on the afternoon.

I said (T 32.11-29):

Listed before me was the Commonwealth’s notice of motion (which I treated as an interlocutory process conformably with r 2.2(1) of the Supreme Court (Corporations) Rules 1999) to set aside the plaintiff’s notice to produce dated 30 November 2020. The notice seeks production of a single document:

Everyone accepts the document exists, and everyone has referred to it as the “Woodside Report”. The commissioning of the report, and the subject matter of the advice, have been disclosed in a meeting of the Senate Economics Legislation Committee on 29 October 2020. The Commonwealth maintains that the Woodside Report attracts public interest immunity, and need not be produced despite the plaintiff’s notice.

I have not yet ruled on the claim. These reasons concern the terms on which the Court has received evidence which the Commonwealth has very recently served and read in support of its claim.

An unredacted version of Ms McGregor’s affidavit (and another affidavit) was provided by hand to my chambers last Friday afternoon, under cover of a letter from the Commonwealth’s solicitors saying that “The plaintiff has been provided with redacted copies of those affidavits, together with a copy of this letter”. I appreciate that, in circumstances where the hearing on Monday was to proceed by audio-visual link, it was sensible that a copy of the unredacted affidavits be physically available to the Court. A disadvantage of the course proposed was the documents supplied to my chambers did not disclose which paragraphs had been made available to the plaintiff and which had been redacted. I now know that the plaintiff was told the previous day that the Commonwealth proposed to take that course, and if there was objection to that course, it has not been made known to me.

My tipstaff wrote to the parties at 8.12am on Monday morning explaining the approach that would be taken:

The hearing before me commenced shortly after 2pm, by audio-visual link, with the participation of both sides. By email sent at 1.59pm, the Commonwealth emailed a redacted form of its submissions to my Associate. That document included an application (in paragraphs 36-40) that the Commonwealth’s application be heard in closed Court. I do not understand that application to have been presaged when the matter had been before the Corporations List Judge on 7 December or earlier in the day. The fact that such an application was to be made was first made apparent during the hearing.

The version of the written submissions which had been emailed was provided to me shortly after the hearing commenced. Some of the paragraphs were redacted. Shortly afterwards, a copy of that document was provided to me sitting in court, which included material not supplied to the plaintiff. I put the latter document to one side.

The Commonwealth’s submission in support of keeping the redacted paragraphs of Ms McGregor’s affidavit confidential from the plaintiff were put as follows:

The Commonwealth maintained that the redacted material was essential to its application. There was the following exchange:

The Commonwealth’s (unredacted) written and oral submissions also relied on what had been said in Franklin v Commissioner of Police [2018] NSWSC 310 at [68]-[69] to the effect that “the ‘usual practice’ is for the confidential material in support of the public interest immunity claim to not be available to the other side”.

The plaintiff opposed this course:

Mr Jackman rejected the contention that there was any “usual practice” which permitted a claim for public interest immunity to be established on the basis of material not made available to the other side. I substantially agree.

First, whether or not a document attracts public interest immunity will ordinarily involve establishing certain matters of fact. In the present case, where it is said that the Woodside Report is a “Cabinet document” – a term which is not free from ambiguity, as is plain from Commonwealth v Northern Land Council (1993) 176 CLR 604 at 614-15; [1993] HCA 24 – that will involve establishing its connection with the processes of Cabinet.

Secondly, there may be cases where in order to establish those matters of fact, it is appropriate for the Court to inform itself other than by way of evidence. Section 130(1) of the Evidence Act 1995 (NSW), on which the Commonwealth relied, proceeds on the premise that that may be appropriate. It provides:

Section 130(1) applies to pre-trial applications such as the present: s 131A. However, before the power to make a direction under s 130(1) is exercised, it remains necessary to establish the competing public interests in that section and form the view that the latter outweighs the former. In some cases that may be obvious, or it may be susceptible to judicial notice; in others, a case will have to be made out by evidence and submission in the usual way in litigation.

Thirdly, the application by the Commonwealth to proceed in closed Court, and its application to read paragraphs 30-34 of Ms McGregor’s affidavit whilst preserving their confidentiality, infringe basic notions of procedural fairness. Put simply, the Commonwealth seeks to obtain a court order in its interests without the plaintiff seeing let alone testing or being heard as to the evidence on which the Commonwealth relies. This is contrary to a defining characteristic of a court. The application of procedural fairness and adherence, as a general rule, to the open court principles have been said to be a defining or essential characteristic of a court: Wainohu v New South Wales (2011) 243 CLR 181; [2011] HCA 24 at [44]; Lawrence v State of New South Wales [2020] NSWCA 248 at [76]. There are, as mentioned in argument, instances where such a course may be appropriate, a point recognised by the qualification given by French CJ and Kiefel J to adherence “as a general rule” to the open court principles. In Assistant Commissioner Condon v Pompano Pty Ltd (2013) 252 CLR 38; [2013] HCA 7 at [68], French CJ indicated that public interest considerations might qualify those defining or essential characteristics of courts. But it may be expected that a court will be astute to determine whether some less unfair procedure may be adopted whilst still preserving the confidentiality underlying the claim of privilege.

By way of example, these considerations were at the forefront of the consideration given by the Court of Appeal in State of New South Wales v Public Transport Ticketing Corporation (No 3) (2011) 81 NSWLR 394; [2011] NSWCA 200 at [19]:

The solution adopted in that litigation – the appointment of two “special counsel” to inspect the documents for which a claim of public interest immunity was maintained – illustrates the desirability of crafting a procedural regime ameliorating the compromise of fairness inherent in the course sought by the Commonwealth.

Fourthly, those considerations are reinforced by statute. The Court Suppression and Non-publication Orders Act mandates consideration of the public interest in open justice. Section 6 provides:

Any order made “must specify the information to which the order applies with sufficient particularity to ensure that the order is limited to achieving the purpose for which the order is made”: s 9(5). The order must specify a period during which it operates (s 12(1)) and “the court is to ensure that the order operates for no longer than is reasonably necessary to achieve the purpose for which it is made”: s 12(2).

This Court is exercising federal jurisdiction (noting that the Commonwealth is a party). In accordance with was said in Rizeq v Western Australia (2017) 262 CLR 1; [2017] HCA 23 at [15]-[16], [32], [90] and [103] and Masson v Parsons (2019) 266 CLR 534; [2019] HCA 21 at [30], s 79 of the Judiciary Act 1903 (Cth) makes the commands in State laws applicable to courts exercising federal jurisdiction. The Commonwealth did not contend that there was anything in federal law displacing the operation of the Court Suppression and Non-publication Orders Act.

I do not accept that there is a “usual practice” in any case in which a claim of public interest immunity is made for the Court to proceed on the basis of material not disclosed to the other side. I do accept that there will be individual cases where that course may be appropriate. There may also be general classes of cases where that course is appropriate. By way of example, I have in mind evidence concerning the identity of police informers or undercover operatives, as explained by Gleeson CJ, Clarke and Sheller JJA in R v Arthur Stanley Smith (1996) 86 A Crim R 308 at 311-312.

It seems to me, on a fair reading of what was said in Franklin v Commissioner of Police at [68]-[69], noting the nature of the subpoenas issued by Mr Franklin and the reference by Johnson J to Meissner v R (1994) 76 A Crim R 81, that this is what the “usual practice” related to. I do not accept that there is any usual practice whereby a claim that a document is a Cabinet document is to be made out by reference to evidence which is to be kept entirely secret from the side seeking production.

Consistently with the obligations upon the Court to proceed in a way which was procedurally fair, I invited the parties to read the entirety of the evidence which was not the subject of any application for non-publication, and to make all submissions that could be made based on that material in open Court. I then invited Mr Kennett SC to take me to the parts of his affidavits which had not been provided to the plaintiff, and to address me on them, by reference to paragraph number and sentence number, without disclosing their contents, and while the plaintiff’s legal representatives continued to participate in the audio-visual hearing. There was no objection to that course. The entirety of the hearing took place without the Commonwealth renewing its application for the Court to be closed.

The Commonwealth’s primary basis for asserting public interest immunity is a “class” claim, based on the status of the Woodside Report as a “Cabinet document”. It maintained in correspondence prior to the hearing that “[t]he basis for the public interest immunity claim is clear from the face of the open affidavits”. Mr Kennett candidly and properly conceded that that was not so.

I formed the view that paragraphs 30-34 of Ms McGregor’s affidavit did not warrant the intrusion into the basal rights of a party to a fair hearing so as to accede to the order sought by the Commonwealth, namely, that it not be published or provided to any person including any of the plaintiffs’ legal representatives. The paragraphs comprise two sentences explaining the basis on which Ms McGregor made the statements in paragraphs 31-34, and the four sentences relating to the creation and use of the Woodside Report and its connection with Cabinet processes. It is the sort of evidence one might expect would be adduced in support of a claim for public interest immunity. But I could see no sound basis for proceeding to determine the Commonwealth’s motion without that information being provided on a strictly confidential basis to nominated legal representatives of the plaintiff. I did not understand the Commonwealth to articulate any such basis when I invited it to do so.

My view was informed by the Commonwealth’s earlier attempt to read redacted paragraphs of the other affidavit, made by a less senior public servant within the Department of Industry, Science, Energy and Resources. These were far from self-evidently so confidential that they could not be shown to at least some lawyers bound by confidential undertakings. That led to my saying the following for the benefit of those providing instructions on behalf of the Commonwealth:

The result was an acceptance by the Commonwealth of those paragraphs being read on the basis that at least two lawyers retained by the plaintiff might see them on a confidential basis (T27.34-37).

Taking a cautious approach, I made an order permitting senior counsel and the partner of the law firm instructing him to have access to paragraphs 30-34 of Ms McGregor’s affidavit, and that otherwise there be no publication of those paragraphs. I also made procedural orders permitting the parties to be further heard in relation to those paragraphs by way of written submissions to be supplied later this week, so as to resolve the balance of the dispute.