AUSTRALIAN COMPETITION TRIBUNAL
Telstra Corporation Ltd (No 2) [2006] ACompT 10
ADMINISTRATIVE LAW – judicial review – telecommunications access regime – application by Commonwealth – public interest immunity claim – whether documents are Cabinet documents – proper administration of review process – proper administration of justice
Trade Practices Act 1974 (Cth): ss 152AB, 152CE, 152CF(3), 152CF(4), 152CGA, 152CGA(1)
Sankey v Whitlam (1978) 142 CLR 1, considered
Commonwealth of Australia v Northern Land Council (1993) 176 CLR 604, applied
Commonwealth v Construction, Forestry, Mining and Energy Union (2000) 98 FCR 31, applied
National Tertiary Education Industry Union v Commonwealth (2001) 111 FCR 583, applied
FILE No 8 of 2006
BY: TELSTRA CORPORATION LTD (ACN 051 775 556)
Applicant
GOLDBERG J
4 DECEMBER 2006
MELBOURNE
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IN THE australian competition tribunal |
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FILE No 8 of 2006
RE: FINAL DECISION BY THE AUSTRALIAN COMPETITION AND CONSUMER COMMISSION DATED AUGUST 2006 IN RESPECT OF ORDINARY ACCESS UNDERTAKINGS SUBMITTED BY TELSTRA CORPORATION LIMITED FOR THE UNCONDITIONED LOCAL LOOP SERVICE
BY: TELSTRA CORPORATION LTD (ACN 051 775 556)
Applicant
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JUDGE: |
GOLDBERG J |
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DATE OF ORDER: |
4 DECEMBER 2006 |
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WHERE MADE: |
MELBOURNE |
THE TRIBUNAL DIRECTS THAT:
1. The application by the Commonwealth of Australia by notice dated 21 November 2006 is refused.
2. Documents A.37, A.38 and A.39 in Annexure A to the Final Index of Documents filed by the Australian Competition and Consumer Commission on 6 November 2006 remain confidential and their contents only be disclosed to solicitors and counsel for the parties and intervenors in this review and one nominated officer or employee of each such party or intervenor upon that person having signed an undertaking to be filed with the Tribunal that that person will keep the contents of such documents confidential and will only use the contents of such documents for the purpose of this review.
3. There be a stay on the disclosure of documents A.37, A.38 and A.39 pursuant to this direction until 2.15pm on Tuesday 5 December 2006 or further order.
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IN the australian competition tribunal |
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FILE No 8 of 2006
RE: FINAL DECISION BY THE AUSTRALIAN COMPETITION AND CONSUMER COMMISSION DATED AUGUST 2006 IN RESPECT OF ORDINARY ACCESS UNDERTAKINGS SUBMITTED BY TELSTRA CORPORATION LIMITED FOR THE UNCONDITIONED LOCAL LOOP SERVICE
BY: TELSTRA CORPORATION LTD (ACN 051 775 556)
Applicant
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JUDGE: |
GOLDBERG J |
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DATE: |
4 DECEMBER 2006 |
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PLACE: |
MELBOURNE |
RULING
1 The Commonwealth of Australia (“the Commonwealth”), by notice dated 21 November 2006, seeks the following orders:
“The documents referred to in paragraphs 7a. – 7d. of Telstra’s Notice of Application dated 10 November 2006 shall not be provided to, or inspected by, the parties to these proceedings on the grounds of public interest immunity.”
The description of those documents, which are identified in Annexure A to the Final Index filed by the Australian Competition and Consumer Commission (“the Commission”), is as follows:
· A.15 Regulation of Telstra’s unconditioned local loop service (“ULLS”): ACCC’s presentation to Interdepartmental Committee formed to consider Telstra’s Request for a Ministerial Pricing Determination for Averaged ULLS Prices;
· A.37 Draft IDC report to cabinet on ULLS retail parity;
· A.38 Interdepartmental committee report – Telstra’s unconditioned local loop service (ULLS) – Department of Finance and Administration report, undated (Appendix A to above IDC report to Cabinet);
· A.39 Report to Government on ULLS Pricing and Retail Price Parity.
2 The circumstances in which the Commonwealth’s application has come about is as follows. On 3 October 2006, in the course of giving directions for the progression of this review, I ordered that the Commission serve on the applicant, Telstra Corporation Ltd (“Telstra”), and the intervenors a draft index of the information given, the documents produced and the evidence given to the Commission and any other information that was referred to in the Commission’s Reasons for the Decision under review for the purposes of s 152CF(4) of the Trade Practices Act 1974 (Cth) (“the Act”) specifying which of those documents, if any, is the subject of a claim of confidentiality and, if there is a claim of confidentiality, which party or person has made such a claim, and their current contact details (“Draft Index”) by 9 October 2006. The directions provided for a sequence of events allowing for the other parties and intervenors to have input into the Draft Index and providing, ultimately, for the Commission to file and serve a Final Index which the Tribunal is to consider in the review.
3 The finalisation of the index is important because s 152CF(4) of the Act provides:
“For the purposes of a review, the Tribunal may have regard only to:
(a) any information given, documents produced or evidence given to the Commission in connection with the making of the decision to which the review relates; and
(b) any other information that was referred to in the Commission’s reasons for making the decision to which the review relates.”
4 The scope of the material covered by s 152CF(4) is expanded by virtue of s 152CGA of the Act which provides:
“(1) If the Commission:
(a) makes a decision referred to in section 152CE; and
(b) gives a person a written statement setting out the reasons for the decision;
the statement must specify the documents that the Commission examined in the course of making the decision.
(2) If a document is specified under subsection (1), information in the document is taken, for the purposes of paragraph 152CF(4)(b), to be referred to in the Commission’s reasons for making the decision.”
5 The Final Index filed by the Commission on 6 November 2006 contained two annexures in addition to listing 325 documents. The documents listed in Annexure A and the statutory and legislative instruments listed in Annexure B, had not been specified in the written statement given by the Commission pursuant to s 152CGA(1) setting out the reasons for the Commission’s Final Decision to reject the undertakings.
6 The specification of the documents that the Commission examined in the course of making the decision was found in Appendix H to the Final Decision and included the 325 documents listed in the main body of the Final Index, but not the documents referred to in Annexure A and Annexure B of the Final Index.
7 Annexure A listed, inter alia, the following documents (being the documents referred to in the Commonwealth’s application):
· A.15 “Regulation of Telstra’s unconditioned local loop service: ACCC’s presentation to Interdepartmental Committee formed to consider Telstra’s Request for a Ministerial Pricing Determination for Averaged ULLS Prices”. The author of the document was specified as the Commission and the entire document was stated to be subject to a confidentiality claim by the Commonwealth and the Commission;
· A.37 “Draft IDC report to cabinet on ULLS retail parity”. The author of the document was specified as an Interdepartmental Committee and the entire document was stated to be subject to a confidentiality claim by the Commonwealth;
· A.38 “Interdepartmental committee report – Telstra’s unconditioned local loop service (ULLS) – Department of Finance and Administration report, undated (Appendix A to above IDC report to cabinet)”. The author of the document was specified as “DOFA” (the Department of Finance and Administration) and the entire document was stated to be subject to a confidentiality claim by the Commonwealth;
· A.39 “Report to Government on ULLS Pricing and Retail Price Parity”. The author of the document was specified as the Commission and the entire document was stated to be subject to a confidentiality claim by the Commonwealth and the Commission.
8 Annexure A to the Final Index came about because in the course of preparing the Final Index the Commission became aware that there were a small number of additional documents that were examined by it in the course of making the ULLS undertaking decision which had not been specified in Appendix H to the Commission’s Reasons for Decision for the purposes of s 152CGA(1) of the Act. Fresh inquiries were made by the Commission and as a result of those inquiries the Commission became aware that the documents listed in Annexure A and Annexure B had been examined by the Commission in the course of making its decision.
9 In a notice of application filed on 10 November 2006 Telstra sought a number of orders including an order that Annexures A and B be deleted from the Final Index.
10 In a Ruling I made on 14 November 2006, I directed, pursuant to s 152CF(3) of the Act, that the Commission provide to Telstra by 24 November 2006 a supplementary written statement pursuant to s 152CGA(1) of the Act specifying any documents that the Commission examined in the course of making its Final Decision in respect of ordinary Access Undertakings submitted by Telstra for the Unconditioned Local Loop Service (“Final Decision”), which documents were not specified in Appendix H to the Final Decision.
11 The purpose of that Ruling was to enable the documents specified in Annexures A and B to the Final Index to be the subject of a supplementary written statement so that they were properly before the Tribunal for the purposes of s 152CF(4). In the Ruling I made the following observations:
“[30] A separate issue arises. Just because a document is referred to in the statement given for the purposes of s 152CGA, and just because a document falls within the scope of the documents under s 152CF(4), it does not follow automatically that the Tribunal either will consider, or is bound to consider, and examine those documents. Even if a document is referred to in a Final Index it is still open to an applicant, and indeed any other party, to submit that a document should not be examined or looked at by the Tribunal or by other parties, whether on the ground of confidentiality, whether on the ground that the document was supplied in error to the Commission or was supplied in circumstances where there was an acceptance or an undertaking given that a document listed was only supplied for a particular purpose otherwise than for the purpose of the undertaking.
[31] Nothing I am saying today precludes Telstra, or indeed any other party, from submitting that a document referred to in the Final Index should not be considered or should not be disclosed to other parties. That remains an issue for later consideration once the proceeding commences or, if application is made for earlier inspection or examination of a document, that issue might have to be determined as a further interlocutory step.”
12 The supplementary written statement which I directed the Commission to provide was provided on 23 November 2006. It included in Annexure A the documents marked and identified as A.15, A.37, A.38 and A.39.
13 Telstra seeks an order that the Commission provide to all parties copies of the documents in Annexure A numbered A.15, A.37, A.38 and A.39. These are the documents in relation to which the Commonwealth, by notice of application, seeks an order that they not be provided to, or inspected by, the parties in this proceeding on the grounds of public interest immunity.
14 Document A.15 comprises the presentation notes provided by the Commission to the members of an Interdepartmental Committee who attended a briefing by the Commission in 2005. The Interdepartmental Committee comprised officers of the Departments of Communications, Information Technology and the Arts (“DCITA”), Prime Minister and Cabinet (“PM&C”), Finance and Administration (“DOFA”), Treasury and Transport and Regional Services. A number of issues were discussed at the briefing including:
· Regulation of Telstra’s PSTN originating and terminating access and ULLS services;
· The merits of averaged versus de‑averaged ULLS prices;
· ULLS pricing and its impact on Telstra;
· The impact of averaged pricing on Telstra’s competitors;
· The impact of averaged pricing on competition in rural areas.
15 After the Commission had given its presentation at the briefing a draft report was prepared by the IDC in relation to Telstra’s ULLS and was circulated to its members. This is Document A.37. A dissenting report was prepared by DOFA in relation to the ULLS pricing process. This is Document A.38. These reports were presented to Senior Ministers for discussion at a Senior Ministers’ meeting on or about 19 December 2005.
16 As set out in par [18] below, on 22 December 2005 the Minister for Communications, Information Technology and the Arts requested that the Commission report to Government on:
· whether the current Commission approach to ULLS took into account Telstra’s capacity to maintain average retail prices consistent with Government’s retail pricing parity policy; and
· how the Commission would ensure that its ULLS pricing decisions enabled the maintenance of retail pricing parity while not placing an unreasonable burden on any industry player.
This report became Document A.39.
17 The Commonwealth relied upon the evidence of Fay Elizabeth Holthuyzen, the Deputy Secretary of the DCITA. Ms Holthuyzen has read and considered the four subject documents and says that it is her view, and that of DCITA, that the documents comprise:
“…high level government communications concerning highly sensitive public policy issues relating to telecommunications. It is my belief that disclosure of these documents would breach the confidentiality of Cabinet and high level government processes and be contrary to the public interest”.
18 Ms Holthuyzen explained the background to the manner in which the four documents came into existence as follows.
“8. In mid‑2005 the Applicant requested the Minister for Communications, Information Technology and the Arts (Minister) to make a Ministerial pricing determination under section 152CH of the Trade Practices Act 1974 to require averaged ULLS access charges, without which the Applicant claimed it would be forced to significantly increase line rental charges to rural customers. The effect of such a determination, if made, would have been to compel the ACCC to accept the pricing methodology contained in the determination.
9. On 15 August 2005, Cabinet considered the issue of price control arrangements to apply to the Applicant from 1 January 2006, including line rental parity. Cabinet resolved that the Minister should seek the Applicant’s views on options to deliver wholesale price averaging and retail price averaging and finalise any regulatory changes in consultation with Senior Ministers.
10. As part of this process DCITA convened an inter‑departmental committee (IDC) to consider these matters. The IDC comprised officers of DCITA, the Department of the Prime Minister and Cabinet (PM&C), the Department of Finance and Administration (DOFA), Treasury, and the Department of Transport and Regional Services.
11. In 2005 the ACCC briefed the IDC in relation to ULLS and certain other matters. Document A15 … comprises the notes provided by the ACCC to attendees at that briefing: …
12. Following the ACCC briefing a draft IDC report was prepared and circulated to IDC members, Document A37 is the draft IDC report. … Document A38 is the draft DOFA dissenting report. …
13. On 19 December 2005 Senior Ministers met to give further consideration to Telstra’s price control arrangements. On that occasion Senior Ministers resolved that the ACCC be required to report to government, as soon as possible, on the following matters:
(a) whether the current ACCC approach to ULLS took into account Telstra’s capacity to maintain average retail prices consistent with government’s retail pricing parity policy; and
(b) how the ACCC would ensure that its ULLS pricing decisions enable the maintenance of retail pricing parity while not placing an unreasonable burden on any industry player.
14. By letter dated 22 December 2005 the Minister requested that the ACCC report to government in the terms described above, and on 31 March 2006 the ACCC provided a report to the Minister as requested (‘the ACCC report’). The ACCC report dated March 2006 is document A39 … and includes discussion on the following issues:
(a) financial implications for Telstra and other industry players relating to the provision of the ULLS; and
(b) ACCC’s views about future policy options open to the government to address any issues that may arise as a result of Telstra having to meet line rental price parity obligations in the context of de‑averaged ULLS access charges.
15. The ACCC report was subsequently circulated to Senior Ministers for their consideration.”
19 Ms Holthuyzen outlined the basis of the claim for public interest immunity in the following terms:
“16. Document A37 consists of the draft IDC report. The document was brought into existence for the purpose of advising the Minister and Senior Ministers and so that officers were fully informed on relevant issues including:
(a) the regulation of Telstra’s ULLS;
(b) the merits of averaged vs. de‑averaged ULLS prices;
(c) ULLS pricing and its impact on Telstra and its competitors; and
(d) the impact of regulatory options on Telstra and its competitors.
17. I am advised by the Department of Prime Minister and Cabinet and believe that the IDC report, in final form, was provided to ministers prior to the meeting of Senior Ministers held on 19 December 2005, including the Prime Minister. I am further advised that in the meeting the ministers deliberated on the recommendations of the IDC report.
18. In this context I have formed the view that it would not be in the public interest for document A37 to be released to the Applicant or other intervening parties in these proceedings: the document was prepared so as to inform relevant officers and to brief Senior Ministers, including the Prime Minister, of a current policy issue and is thus analogous to a Cabinet document.
19. Moreover, distribution of a high‑level policy document of this kindmay compromise future Cabinet and / or Senior Minister deliberationsand adversely affect the integrity of advice provided to decision makers, having regard to the need for candour by and between officialsand Ministers in the formulation of policy, My concern is that the potential public disclosure of such documents in the future would negatively affect the quality of the advice provided to Cabinet and Senior Ministers; that for this further reason it is important such materials not be publicly disclosed or otherwise disseminated.
20. Document A38 is the draft DOFA dissenting report to the draft IDCreport. The DOFA dissenting report, in final form, was appended tothe report provided to Senior Ministers and the Prime Minister in thecircumstances outlined above in relation to document A37.
21. My views expressed in relation to Document A37 (at paragraphs 18 and 19, supra) as being contrary to the public interest for the document to be distributed beyond government, apply equally with respect to document A38, and for the same reasons.
22. Document A39 is the March 2006 ACCC report prepared at the request of Senior Ministers and is entitled ‘Report to Government on the ULLS Pricing and Retail Price Parity’. The ACCC report was prepared atthe request of Senior Ministers and for the purposes of those ministersinforming themselves on current policy issues. It comprises a review of whether the ACCC’s current de‑averaged pricing approach on Telstra’s ULLSis consistent with the government’s retail pricing parity obligation on Telstra, and whether the co‑existence of de‑averaged ULLS pricing and retailpricing parity impose an unreasonable burden on any industry player.
23. At the time of affirming this affidavit the range of policy issuesdiscussed in document A39 (and the other documents) remains the subject ofongoing debate within industry and the broader community and is subject toongoing monitoring by government. Whilst the ACCC report has not yet beendiscussed by Cabinet or Senior Ministers (although it has been distributed toMinisters for review) it remains a real possibility that this will occur in thefuture.
24. 1 have formed the view that it would be contrary to the public interest for document A39 to be disclosed to the Applicant and the otherintervening parties. The need to preserve the confidentiality of thedeliberations of Senior Ministers, including materials prepared toassist such deliberations, and the need for openness in communications relating to the formulation of policy generally, militates against disclosure of this document. This is underlined in thisinstance by the sensitive nature of many of the issues arising in thetelecommunications policy area, in particular, in relation to thespecific telecommunications policy issues canvassed in A39 and theother PII documents.
25. Document A15 was prepared for the IDC by the ACCC. As such thedocument was prepared so as to inform relevant officers to enablethem to brief Senior Ministers, including the Prime Minister, of acurrent policy issue. As A15 was an important input document to A37and A38 it carries the significant risk of disclosing the content of thoseother PII documents.”
“14. As the Ministry, the Cabinet and Cabinet committees together form anintegral part of the Cabinet system, important work of Cabinetsensibly falls to be dealt with by its committees. In this regard, Senior Ministersconstitutes a group comprising the Prime Minister, the Deputy PrimeMinister, the Treasurer and the Minister for Finance andAdministration, but is not constituted as a formal committee of Cabinet.
15. Meetings of Senior Ministers are supported by the Cabinet Secretariatin a similar way to meetings of Cabinet committees. Thedeliberations of Senior Ministers are conducted in accordance with the sameprinciples of confidentiality as apply in relation to meetings of Cabinetcommittees themselves for this purpose: note taking arrangements,document handling procedures, processes for preparing submissionsand processes for minuting decisions of Senior Ministers are similar tothose which apply to a meeting of a committee of Cabinet. In this waymeetings of Senior Ministers can be considered as analogous tomeetings of a Cabinet committee, and in my experience are treatedand regarded as such.
16. It is my view, and that of PM&C and DC1TA, that the public interestwhich attaches to the preservation of the confidentiality of meetings ofSenior Ministers is identical to the public interest which attaches to thepreservation of the confidentiality of meetings of Cabinet committees. The consequences of the breach of such confidentiality would beprecisely the same as breach of Cabinet and Cabinet Committeeconfidentiality.”
21 Ms Goddard explained the position of documents brought into existence for the purposes of Cabinet or Senior Ministers in the following terms:
“19. This category includes documents which have not been considered byCabinet or Senior Ministers to date, but may be the subject of futuredeliberations by Cabinet or Senior Ministers.
…
21. It is my opinion, and the position of PM&C and DCITA, that therelease of documents falling within this category would interfere withthe efficient operation of the Cabinet or Senior Ministers processeswithin government. This view has been formed for two reasons.
(i) First, the disclosure of these documents would breach the necessary confidentiality of the Cabinet or the Senior Ministers process.
(ii) Secondly, the documents would be open to being interpreted as revealing issues, options or proposals that have been considered byCabinet or Senior Ministers: so construed, these documents would beopen to being interpreted as revealing the manner in which ministershave proceeded in relation to certain proposed policy changes,notwithstanding that those issues, options or proposals may not havebeen addressed by Cabinet or Senior Ministers at all. Indeed, the documents may not accurately reflect the final views of the relevant minister, but rather an inaccurate perception by officials of aminister’s views, giving the document's possibly unwarranted authority.
22. In this context, where it is the case that a document has been requestedby Cabinet or Senior Ministers, but not yet considered by that body, thedamage to the public interest might be expected to be even greater where it ispossible that Cabinet or Senior Ministers will be called upon to consider those documents at some time in the future. In my experience this is not anunusual occurrence.”
22 The review before the Tribunal is a review of a decision of the Commission made on 25 August 2006 to reject two access undertakings given by Telstra to the Commission in respect of the applicable monthly charge for the provision of the ULLS for the period from 1 January 2006 to 30 June 2007 and the 2007/2008 financial year respectively. The monthly charge submitted by Telstra is $30 (GST exclusive) per month per ULLS.
23 In its application to the Tribunal Telstra contends in paragraph 28 that:
“… the price of ULLS should be geographically averaged to reflect the price parity obligations faced by Telstra at the retail level. In the absence of geographic averaging, inefficient entry will be encouraged and Telstra’s legitimate business interests will be undermined.”
Telstra specifies as one of the issues in respect of which the application is made “whether the price of ULLS should be geographically averaged”.
24 In its statement of facts, issues and contentions Telstra contends that:
· the $30 (GST exclusive) per month price for ULLS should be geographically averaged to reflect, inter alia, the price parity obligations faced by Telstra at the retail level;
· in the absence of geographic averaging, inefficient entry will be encouraged and Telstra’s legitimate business interests will be undermined.
25 The Commission in its statement of facts, issues and contentions disagrees with Telstra’s contention that the price of ULLS should be geographically averaged to reflect, inter alia, the price obligations faced by Telstra at the retail level and contends that averaged prices would result in Telstra charging access seekers a price for the ULLS in urban areas which is above, and in rural areas which is below, the efficient cost of providing the ULLS.
26 Written submissions have been filed by the parties and they consider in great detail the issue of the government’s retail parity pricing policy and Telstra’s proposal to have averaged prices and the relationship between the retail parity pricing policy and averaged prices.
27 The Commonwealth contended that the four documents were prepared for the purposes of provision to Cabinet and provision of advice at high levels of government in the formulation of important matters of public policy. The Commonwealth accepted that the documents did not fall within the class of Cabinet documents which recorded actual Cabinet deliberations. The Commonwealth did not contend that the documents fell within the class of Cabinet minutes or minutes of discussion between Cabinet Ministers and between heads of government departments. It rather submitted that the documents fell within a secondary class of Cabinet documents, that is to say, a class of documents prepared for the purpose of Cabinet consideration and to assist Cabinet in its deliberations.
28 It is well established that there are certain classes of documents which are entitled to protection from production on the grounds of Crown privilege or public interest immunity, although that protection is not absolute. In general terms the documents entitled to such protection fall into the following categories:
· Documents recording or evidencing Cabinet minutes, discussions and decisions;
· Documents prepared for submission to Cabinet for its consideration which will disclose subject‑matter to be considered and discussed by Cabinet;
· Documents which will disclose the substance of matters considered and discussed by Cabinet.
29 The ground for such protection is usually put on the basis of protecting and supporting Cabinet collective responsibility by ensuring that government policy may be formulated and determined on the basis of a free exchange of views by Ministers so that policy is developed and Cabinet decisions are made in an uninhibited way. It has also been suggested that the immunity is designed to ensure that there is an opportunity at high levels of government for a complete and free exchange of material with candour. However, this basis has been criticised in a number of cases.
30 The circumstances in which a claim for public interest immunity or Crown privilege may arise were considered at length by the High Court in Sankey v Whitlam (1978) 142 CLR 1. Gibbs ACJ said at 39‑40:
“However it has been repeatedly asserted that there are certain documents which by their nature fall in a class which ought not to be disclosed no matter what the documents individually contain; in other words that the law recognises that there is a class of documents which in the public interest should be immune from disclosure. The class includes cabinet minutes and minutes of discussions between heads of departments … papers brought into existence for the purpose of preparing a submission to cabinet … and indeed any documents which relate to the framing of government policy at a high level … According to Lord Reid, the class would extend to ‘all documents concerned with policy making within departments including, it may be, minutes and the like by quite junior officials and correspondence with outside bodies’ …
One reason that is traditionally given for the protection of documents of this class it that proper decisions can be made at high levels of government only if there is complete freedom and candour in stating facts, tendering advice and exchanging views and opinions, and the possibility that documents might ultimately be published might affect the frankness and candour of those preparing them. Some judges now regard this reason as unconvincing, but I do not think it altogether unreal to suppose that in some matters at least communications between Ministers and servants of the Crown may be more frank and candid if those concerned believe that they are protected from disclosure. For instance, not all Crown servants can be expected to be made of such stern stuff that they would not be to some extent inhibited in furnishing a report on the suitability of one of their fellows for appointment to high office, if the report was likely to be read by the officer concerned. However this consideration does not justify the grant of a complete immunity from disclosure to documents of this kind.”
31 Stephen J said at 62‑63:
“Sometimes class claims are supported by reference to the need to encourage candour on the part of public servants in their advice to Ministers, the immunity from subsequent disclosure which privilege affords being said to promote such candour. The affidavits in this case make reference to this aspect. Recent authorities have disposed of this ground as a tenable basis for privilege. Lord Radcliffe in the Glasgow Corporation Case remarked [(1956 SC (HL) 20] that he would have supposed Crown servants to be ‘made of sterner stuff’, a view shared by Harman LJ in the Grosvenor Hotel Case[1965] Ch at p55] then, in Conway v Rimmer[[1968] AC 901], Lord Reid dismissed the ‘candour’ argument but found the true basis for the public interest in secrecy, in the case of cabinet minutes and the like, to lie in the fact that were they to be disclosed this would ‘create or fan ill‑informed or captious public or political criticism. ... the inner workings of the government machine being exposed to the gaze of those ready to criticize without adequate knowledge of the background and perhaps with some axe to grind…”
32 The principle of public interest immunity was considered further by the High Court in Commonwealth of Australia v Northern Land Council (1993) 176 CLR 604. At 614‑616 the majority of the High Court (Mason CJ, Brennan, Deane, Dawson, Gauldron and McHugh JJ) said:
“It should be observed at the outset that the documents for which the Commonwealth claims immunity from disclosure are documents which record the actual deliberations of Cabinet or a committee of Cabinet. They are not documents prepared outside Cabinet, such as reports or submissions, for the assistance of Cabinet. Documents of that kind are often referred to as Cabinet documents. When immunity is claimed for Cabinet documents as a class and not in reliance upon the particular contents, it is generally upon the basis that disclosure would discourage candour on the part of public officials in their communications with those responsible for making policy decisions and would for that reason be against the public interest. The discouragement of candour on the part of public officials has been questioned as a sufficient, or even valid, basis upon which to claim immunity. On the other hand, Lord Wilberforce has expressed the view that, in recent years, this consideration has ‘received an excessive dose of cold water’ [Burmah Oil Co Ltd v Bank of England [1980] AC 1090 at 1112].
But it has never been doubted that it is in the public interest that the deliberations of Cabinet should remain confidential in order that the members of Cabinet may exchange differing views and at the same time maintain the principle of collective responsibility for any decision which may be made.
…
It is not so much a matter of encouraging candour or frankness as of ensuring that decision‑making and policy development by Cabinet is uninhibited.”
33 The majority of the High Court said, later at 616:
“The classification of claims for public interest immunity in relation to documents into "class" claims and "contents" claims has been described as ‘rough but accepted’ [Burmah Oil Co Ltd v Bank of England at 1111]. It serves to differentiate those documents the disclosure of which would be injurious to the public interest, whatever the contents, from those documents which ought not to be disclosed because of the particular contents. Both upon principle and authority, it is hardly contestable that documents recording the deliberations of Cabinet fall within a class of documents in respect of which there are strong considerations of public policy militating against disclosure regardless of their contents [Lanyon Pty Ltd v The Commonwealth (1974) 129 CLR 650]. But, whatever the position may have been in the past, the immunity from disclosure of documents falling within such a class is not absolute. The claim of public interest immunity must nonetheless be weighed against the competing public interest of the proper administration of justice, which may be impaired by the denial to a court of access to relevant and otherwise admissible evidence.”
34 The distinction between what is loosely called “class documents” and “contents documents” was recognised more recently in Commonwealth v Construction, Forestry, Mining and Energy Union (2000) 98 FCR 31. In that case the Full Federal Court held that the doctrine of public interest immunity protected a letter from a Minister to the Prime Minister which sought the Prime Minister’s agreement to raise particular matters in Cabinet. The Full Court held that disclosure of the contents of the letter would reveal the nature of matters considered by Cabinet and “at least part of the Cabinet’s deliberation of those matters”. The Full Court said at 43:
“Disclosure of the contents of the letter would therefore disclose the position of the Minister, the arguments he wished to advance, and the topic which in all probability was discussed at the meeting. …
When the evidence is balanced, the Union has not established any exceptional circumstances that outweigh those militating against disclosure.”
35 The Commonwealth also relied upon the reasoning of Weinberg J in National Tertiary Education Industry Union v Commonwealth (2001) 111 FCR 583, where a claim for public interest immunity was upheld in respect of a submission which the Minister for Education, Training and Youth Affairs submitted to Cabinet for its consideration. The evidence was that the contents of the document revealed issues considered by Cabinet, the Minister’s position on those issues and suggested the arguments that the Minister could be expected to have advanced during the Cabinet meeting. Weinberg J concluded that inspection of the document would have the tendency to reveal Cabinet deliberations. His Honour decided that the document was not crucial to the Union’s case against the Commonwealth and did not prevent the Union from putting the case it wished to put.
36 I do not consider that Document A.15 falls into the secondary class of Cabinet documents identified by the Commonwealth. It consists of briefing notes presented to the IDC, but it was not prepared for submission to a Minister, Cabinet or a Cabinet committee. It was prepared to inform interdepartmental officers to enable them to brief Ministers on a current policy issue. It may be that it was an input document to subsequent documents which were prepared for submission to Ministers but that fact alone does not qualify it for protection from disclosure. I do not accept that its disclosure contains a significant risk of disclosing the contents of documents otherwise entitled to protection from disclosure. I do not consider that it falls within any category of Cabinet or high level government document hitherto protected from production on the ground of public interest immunity.
37 Documents A.37, A.38 and A.39 fall into a different category. Documents A.37 and A.38 are both draft documents and although A.37 is marked “CABINET‑IN‑CONFIDENCE” it was not intended (on the basis that the draft became a final document) for submission to Cabinet or to a Cabinet Committee as such. Although Ms Holthuyzen says the documents are analogous to a Cabinet document they do not fall into the recognised high level of Cabinet documents being documents submitted to Cabinet for its consideration and deliberation.
38 In its final form it was provided to a meeting of Senior Ministers, including the Prime Minister, which did not comprise a Cabinet Committee as such. Ms Goddard describes the group of Senior Ministers but acknowledges that it is not constituted as a formal committee of Cabinet. She expresses the view that the public interest which attaches to the preservation of the confidentiality of meetings of Senior Ministers is identical to the public interest which attaches to the preservation of the confidentiality of meetings of Cabinet committees. However, the principle of collective responsibility which underpins the protection given to Cabinet deliberations does not apply necessarily to meetings of Ministers, whether Senior Ministers or otherwise.
39 Ms Goddard also expresses the view that the disclosure of Documents A.37 and A.38 could or may damage the public interest in that disclosure would impinge upon or affect effective and efficient government. As Ms Goddard acknowledges, this objective is achieved by requiring that whatever the range of private views put by Ministers in Cabinet, once decisions are arrived at and announced, they are supported by all Ministers. However, I do not consider that that situation arises in the context of a consideration of Documents A.37 and A.38 by a meeting of Senior Ministers. A Cabinet decision is not made at that time and the issue of collective responsibility does not arise.
40 Document A.39 falls into a different category again. There is some confusion as to how this document came into existence. Ms Goddard said that it was requested by the meeting of Senior Ministers on 19 December 2005. However, the document itself states that the Minister for Communications, Information Technology and the Arts, Senator Coonan, requested the Commission to undertake the review it reports on. In any event, it was not brought into existence for the purpose of consideration or deliberation by Cabinet or a Cabinet committee. Further, notwithstanding the fact that it was delivered to the Minister or the Department on 30 March 2006, it has not yet been the subject of consideration or deliberation by the Senior Ministers. According to Ms Goddard, it “may be the subject of further deliberations by Cabinet or Senior Ministers in the future”.
41 Ms Goddard said that the disclosure of Document A.39 could or may damage the public interest because it would be open to being interpreted as revealing issues, options or proposals that have been considered or discussed by Cabinet or Senior Ministers. That situation has not yet occurred. At the present time, the document cannot be said to be a document which will necessary disclose the substance of matters considered or discussed by Cabinet or a Cabinet committee. That situation may never arise. Nevertheless, I cannot discount that this situation may arise in the future. As the document is entitled to “Report to Government” I consider that it is arguable, albeit with some doubt, that it falls within the scope of protection by way of public interest immunity because it makes recommendations to Government as to policy decisions which might be made by Government.
42 Although it is arguable that the principle of public interest immunity extends to documents prepared by government departments for submission to Ministers as well as for submission to Cabinet, there is no doubt that such protection is not absolute but must be balanced against the interests of justice. The Commonwealth did not submit otherwise.
43 The circumstances in this case are unusual and give rise to issues quite different from the issues faced in the earlier cases which have considered the application of public interest immunity. In those cases a party sought to have produced before a court, by way of either discovery or subpoena, a document which was not available to the party who was seeking to advance its case. In the present case, the relevant documents in respect of which public interest immunity is claimed, have been in the possession of the Commission and have been examined by it in the course of making its decision to reject the access undertakings given by Telstra. In short, the documents are part of the documents which have informed the decision which is under review. Those documents, in the ordinary course, should form part of the material to be placed before the Tribunal on its review of the Commission’s decision: s 152CF(4) and s 152CGA(2). If the immunity is granted and the review before the Tribunal proceeds, then the position will be that the Commission will have access to, and knowledge of, documents, which it examined in the course of reaching its decision, which will not be available to Telstra, or indeed, to any of the other intervenors. Accordingly, the requirements of s 152CF(4) will not be satisfied.
44 The documents contain material and information on a critical issue to be determined in the review, namely whether Telstra’s ULLS price should be averaged or de‑averaged. In the absence of access to, and knowledge of, the contents of these four documents, Telstra will be unable to determine whether the submissions made and the material to be relied upon by the Commission are consistent with, or countered by, material contained in those documents. Telstra will not have available to it material to which the Tribunal can have regard in accordance with s 152CF(4).
45 In my view this is an unjust position for Telstra in this review. It puts Telstra at a critical disadvantage in relation to a key issue before the Tribunal. It is also of relevance that the issues before the Tribunal have a significant public interest element because they affect the pricing of a telecommunications service for a substantial proportion of the Australian community. Section 152AB of the Act requires the Tribunal to pay particular regard to the promotion of the long‑term interests of end‑users of relevant carriage services.
46 Consistently with established authority, I have examined the four documents myself. I am satisfied that the material in them is highly relevant to the issues before the Tribunal. In many respects, the information and material contained in the documents is factual and non‑controversial although, in a number of respects, opinions are expressed on issues relating to ULLS pricing. Some of these matters bear upon issues of government policy but I do not consider, in all the circumstances, that any future consideration or formulation of government policy in relation to ULLS or any other form of telecommunications pricing will be inhibited or restricted by the disclosure of such information to the parties and intervenors involved in this proceeding in the limited manner I propose to direct.
47 In substance I am involved in a balancing exercise, balancing the interests of justice, fairness and the due administration of the law with the protection of the ability of Cabinet, Cabinet committees and Government to consider and discuss policy issues in the absence of extraneous considerations or pressures. I am prepared to accept for the purposes of the argument that Documents A.37, A.38 and A.39 fall within what the Commonwealth submitted was the second class of Cabinet documents notwithstanding the fact that none of the documents constitutes a submission to Cabinet or a Cabinet committee or constitutes a document which will disclose a deliberation of Cabinet or any Cabinet committee. I have also taken into account that Document A.39, which is more akin to a Cabinet document entitled to the protection from production on the grounds of public immunity than the other documents, has not been considered or deliberated upon.
48 When I weigh the claim of public interest immunity in respect of those documents against the competing public interest in the proper administration of justice and, in particular, the public interest in the proper administration of the review process before the Tribunal provided for by Pt XIC of the Act and, in particular, ss 152CF(4) and 152CGA of the Act, and take into account the significance and relevance of the documents in relation to the subject matter of the review before the Tribunal, I consider that the public interest in the proper administration of justice and proper administration of the review process before the Tribunal would be impaired and impinged upon by upholding the claim of public interest immunity and denying Telstra access to those documents.
49 I have reached the conclusion that the documents are of such importance and relevance to the review before the Tribunal (particularly having regard to the fact that the Commission has access to them) that any detriment to the public interest involved in disclosure to the parties and intervenors to the review in the limited manner I propose to direct is outweighed by the public interest in the advancement of justice and the carrying out of the review process required by Pt XIC of the Act, bearing in mind the extent of the record which was before the Commission and is to be placed before the Tribunal in accordance with ss 152CF(4) and 152CGA of the Act.
50 I consider that any potential effect on any future Cabinet consideration of the issues raised in Documents A.37, A.38 and A.39 can be minimised if I direct that the documents remain confidential in respect of this review and that their contents only be disclosed to solicitors and counsel for the relevant parties and intervenors and one nominated officer or employee of each relevant party and intervenor, on condition that such person only uses the information and material contained in the three documents for the purposes of this review.
51 In those circumstances I direct that the contents of Documents A.37, A.38 and A.39 remain confidential and that their contents only be disclosed to solicitor and counsel for the parties and intervenors in this review and one nominated officer or employee of each such party or intervenor upon that person having signed an undertaking to be filed with the Tribunal that that person will keep the contents of such documents confidential and will only use the contents of such documents for the purpose of this review.
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I certify that the preceding fifty‑one (51) numbered paragraphs are a true copy of the Ruling herein of the Honourable Justice Goldberg . |
Associate:
Dated: 4 December 2006
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Counsel for Telstra Corporation Ltd: |
Dr J Griffiths S.C. and M Connock |
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Solicitor for Telstra Corporation Ltd: |
Mallesons Stephen Jacques |
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Counsel for the Australian Competition and Consumer Commission: |
Ms M Sloss S.C. and A McLelland |
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Solicitor for the Australian Competition and Consumer Commission: |
DLA Phillips Fox |
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Counsel for Agile Pty Ltd, Chime Communications Pty Ltd, Primus Telecommunications Pty Ltd, Macquarie Telecom Pty Ltd and PowerTel Limited: |
Mr Nicholls |
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Solicitor for Agile Pty Ltd, Chime Communications Pty Ltd, Primus Telecommunications Pty Ltd, Macquarie Telecom Pty Ltd and PowerTel Limited: |
Nicholls Legal |
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Counsel for the Commonwealth of Australia: |
Mr A Southall S.C. |
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Solicitor for the Commonwealth of Australia: |
Australian Government Solicitors |
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Date of Hearing: |
24 November 2006 |
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Date of Ruling: |
4 December 2006 |