Johns v Australian Securities Commission

This is a little adjunct to my post ‘Restraints on Use of Information Obtained by Compulsion‘, a place to store away for future reference the little case note of Johns v Australian Securities Commission (1993) 178 CLR 408; [1993] HCA 56 penned by Justice McKerracher in Apache Northwest Pty Ltd v Agostini [2009] FCA 534.  In digesting the quotation from Johns, it is helpful to know what s. 25 of the Australian Securities Commission Act, 1989 said.  Here is Justice McKerracher’s case note:

48.  The sole issue is whether the release of the s 63 information to the Panel is for the purposes of the 1969 State Act or Regulations. The reason this issue is central to Apaches’ complaint is because of the statement of principle articulated in Johns v Australian Securities Commission [1993] HCA 56; (1993) 178 CLR 408 at 424.

49.  It is desirable, in my view, to focus, as did senior counsel for Apache, on the facts of Johns’ case as those facts do provide at least an indication, as to circumstances in which the principle established in Johns’ case may fall for consideration. The facts in Johns were that in September 1990 the Government of Victoria appointed a Royal Commission to inquire into the affairs of the Tricontinental group of companies of which Mr Johns was, for each such company, the Managing Director. At the same time the Attorney General for Victoria gave a ministerial direction to the National Companies and Securities Commission (NCSC) to arrange for an investigation into the affairs of Tricontinental by the same Royal Commissioners. On the same day, the NCSC appointed the Royal Commissioners as inspectors to carry out the investigation. However, before the Royal Commissioners embarked on their hearing, the functions of the NCSC devolved to the Australian Securities Commission (ASC). In February of the following year, the ASC delegated to Ms Megay its powers and functions under Pt 3 of the Act pursuant to which Mr Johns was given a notice to appear for examination before Ms Megay in relation to the investigation of the activities of the Tricontinental group. Under compulsion he appeared before her on a number of occasions and answered questions. Transcripts of the hearings were then given to the Royal Commission. Ms Megay also gave written permission for the Royal Commission to use the transcripts in a public hearing. When copies of those transcripts were tendered in evidence at the public hearing, the Royal Commission made copies available to the media. In the following year, Mr Johns brought a proceeding in this Court for review of the decision of the ASC which resulted in the handing over of the transcripts to the Royal Commission and for orders against media bodies restraining further publication of them. That application was dismissed. The decision to dismiss was subsequently affirmed on appeal by a majority of a Full Court of this Court. Special leave was given to appeal to the High Court on the validity of the decision by Ms Megay to release the transcripts to the Royal Commission in circumstances which allowed the information to be published generally.

50.  Brennan J (at 423-425), as his Honour then was and with whom Dawson J (at 435), Gaudron J (at 458) and McHugh J (at 467) relevantly agreed, observed:

Information is intangible. Once obtained, it can be disseminated or used without being impaired, though dissemination or use may reduce its value or the desire of those who do not have it to obtain it. Once disseminated, it can be disseminated more widely. A person to whom information is disclosed in response to an exercise of statutory power is thus in a position to disseminate or to use it in ways which are alien to the purpose for which the power was conferred. But when a power to require disclosure of information is conferred for a particular purpose, the extent of dissemination or use of the information disclosed must itself be limited by the purpose for which the power was conferred. In other words, the purpose for which a power to require disclosure of information is conferred limits the purpose for which the information disclosed can lawfully be disseminated or used. In Marcel v Commissioner of Police of the Metropolis [[1992] Ch. 225, at p 234. The Vice-Chancellor’s view in this respect was affirmed on appeal: see [1992] Ch., esp. at pp. 261, 262.] Sir Nicolas Browne-Wilkinson V-C said, in reference to a statutory power conferred on police to seize documents:

“Powers conferred for one purpose cannot lawfully be used for other purposes without giving rise to an abuse of power. Hence, in the absence of express provision, the Act cannot be taken to have authorized the use and disclosure of seized documents for purposes other than police purposes.”

And in Morris v Director of the Serious Fraud Office [[1993] Ch. 372, at p. 381], Sir Donald Nicholls V-C said in reference to information acquired by exercise of statutory powers:

“The compulsory powers of investigation exist to facilitate the discharge by the SFO of its statutory investigative functions. The powers conferred by s 2 are exercisable only for the purposes of an investigation under s 1. When information is obtained in exercise of those powers the SFO may use the information for those purposes and purposes reasonably incidental thereto and such other purposes as may be authorized by statute, but not otherwise. Compulsory powers are not to be regarded as encroaching more upon the rights of individuals than is fairly and reasonably necessary to achieve the purpose for which the powers were created. That is to be taken as the intention of Parliament, unless the contrary is clearly apparent.”

A statute which confers a power to obtain information for a purpose defines, expressly or impliedly, the purpose for which the information when obtained can be used or disclosed. The statute imposes on the person who obtains information in exercise of the power a duty not to disclose the information obtained except for that purpose. If it were otherwise, the definition of the particular purpose would impose no limit on the use or disclosure of the information. The person obtaining information in exercise of such a statutory power must therefore treat the information obtained as confidential whether or not the information is otherwise of a confidential nature. Where and so far as a duty of non-disclosure or non-use is imposed by the statute, the duty is closely analogous to a duty imposed by equity on a person who receives information of a confidential nature in circumstances importing a duty of confidence.

A person who obtains information in exercise of the powers conferred by s 19 of the Act comes under a statutory duty of confidence with respect to the information thus obtained. It is therefore important to ascertain the purposes for which such information can be legitimately used or disclosed. In the first place, the power conferred by s 19 of the Act to require a person to appear for examination and to answer questions is conferred for the purpose of obtaining “information relevant to a matter that [the ASC] is investigating, or is to investigate, under Division 1” of Pt 3 of the Act. So the information acquired by conducting a s 19 examination may be used for the purposes of such an investigation. In addition, s 127(3) authorizes disclosure of otherwise confidential information by, inter alia, the members and staff members of the ASC for the purposes of performing the official functions of the person making the disclosure. As investigations are but some of the functions of the ASC (most of which are prescribed by Pt 2 of the Act) the Act contemplates that information acquired on examinations under s 19 may be used and disclosed for the purpose of the performance or exercise of any of the functions of the ASC Then, certain purposes other than the performance of the functions of the ASC are approved by sub-ss (2) and (4) of s 127. Information obtained in exercise of the powers conferred by s 19 may therefore be used or disclosed for the purpose of the performance of any of the functions of the ASC and for any of the purposes mentioned in sub-ss (2) and (4) of s 127. But for no other purpose.

The purposes for which information may legitimately be used or disclosed are one thing; the means by which information is used or disclosed are another. Section 127 of the Act relates to purposes; s 25(3) relates to means. The two provisions must be read together. Section 25(3) cannot be read as conferring a broad discretionary power to disseminate information obtained in exercise of powers conferred by s 19 [I am, with respect, unable to accept a view of s 25(3) as broad as that embraced by the Full Court of the Supreme Court of Western Australia in interpreting s 298(8) of the Companies (Western Australia) Code in Wardley Australia Ltd. v. Attorney-General (W.A.) (1991), 5 W.A.R 453, at p. 468.]. The power conferred by s 25(3) must be exercised consistently with the provisions of s 127 so that the giving to a person of “a copy of a written record of the examination … together with a copy of any related book” under s 25(3) is authorized only if it be for a purpose consistent with s 127. Section 25(3) can be read as authorizing the ASC to give copies of a transcript to another person in cases in which the disclosure of the information contained therein is authorized by s 127(2), (3) or (4). Or s 127(2), (3) or (4) can be read as themselves authorizing the employment of appropriate means (including the giving of transcripts) by which to disclose the information that can legitimately be disclosed in accordance with those sub-sections. It matters not whether those provisions be read in one way or the other. The extent of the authority to give a transcript is the same: it is a limited authority. (emphasis added)

51. The language of Brennan J is deliberate. His Honour describes dissemination of information ‘in ways which are alien to the purpose for which the power was conferred’. His Honour stresses that when a power to require a disclosure of information is conferred for a particular purpose, the extent of dissemination or use of the information disclosed must itself be limited by the purpose for which the power was conferred. (emphasis added) In Katsuno v The Queen [1999] HCA 50; (1999) 199 CLR 40 (at [24]) the High Court approved of Brennan J’s analysis in Johns [1993] HCA 56; 178 CLR 408 (at 424). It held that the practice of the Chief Commissioner of supplying details or information obtained as a result of inquiries made pursuant to s 21(3) of the Juries Act to a prosecutor (as happened in that case), or to anyone else other than the Sheriff prior to the delivery of a copy of the panel in open court was unlawful and, if necessary, its continuance could be restrained by injunction: see also Gleeson CJ at [2], McHugh J at [54] and Kirby J at [110].’

Print Friendly, PDF & Email

Leave a Reply