\Wo CATCHWORDS Trade Practices - Application for order under s.157 Trade Practices Act - Documents "prepared" by an officer of the Commission - Documents not "tending to establish" the case of the defendant corporations. Trade Practices Act 1974, s.157. TRADE PRACTICES COMMISSION v. T.N.T. MANAGEMENT PTY. LIMITED & ORS. N.S.W. No. G44 of 1978 Bowen C.J. 9 October 1981 Sydney. IN THE FEDERAL COURT OF AUSTRALIA) ) NEW SOUTH WALES DISTRICT REGISTRY) No. G44 of 1978 GENERAL DIVISION CORAM: Bowen C.J. 9 October 1981. ) ) BETWEEN: TRADE PRACTICES COMMISSION Plaintiff : T.N.T. MANAGEMENT PTY. LIMITED First hefendant BRAMBLES HOLDINGS LIM* TED Second Defendant MAYNE NICKLESS LIMITED Third Defendant YOUNGS TRANSPORT PTY. LIMITED Fourth Defendant ANSETT TRANSPORT INDUSTRIES (OPERATIONS) PTY. LIM..'TED Fifth Defendant EXPRESS FREIGHT PTY. LIMITED Sixth Defendant ASSOCIATED STEAMSHIPS PTY. LIMITED Sevent. Defendant IPEC HOLDINGS LIMITE! E1ghth Defendant INTERSTATE PARCEL EXP HSS CO. PTY. LIMITED Ninth Defendant -2- REASONS FOR JUDGMENT This is the first dispute arising under s.157 of the Trade Practices Act 1974 (the Act) to come before this Court. It arises in proceedings brought by the Trade Practices Commission (the Commission) against T.N.T. Management Pty. Limited (lst Defendant), Brambles Holdings Limited (2nd Defendant), Mayne Nickless Limited (3rd Defendant), Youngs Transport Pty. Limited (4th Defendant), Ansett Transport Industries (Operations) Pty. Limited (5th Defendait), Express Freight Pty. Limited (6th Defendant), Associated Steamships Pty. Limited (7th Defendant), Ipec Holdings Limited (8th Defendant) and Interstate Parcel Express Co. Pty. Zimited (9th Defendant). The Commission seeks pecuniary penalties and injunctions. Wynne Patricia Hannon swore an affidavit of discovery for the Commission on 27 January 1981. The documents were listed in Exhibit A to that affidavit. The lists wer: extensive, being grouped into 31 volumes and extending ovex 537 pages. After some correspondence between the solicitc.s a demand under s.157 was made on behalf of the lst, 'th and 7th defendants for copies of certain documents for which privilege had been claimed. Finally, in a letter dated 13 May 1981 the Commonwealth Crown Solicitor acting on behalf of the Commission wrote as follows: -3- "I advise that the plaintiff does not have in its possession any documents that would come within the ambit of s.157 of the Act which have not been discovered to you." On 11 June 1981 Miss Hannon swore a further affidavit of discovery which had exhibited to it two lists of documents, one marked Exhibit Y and the other Exhibit 2. The list of ' documents in Exhibit Y, which extended over 11 pages, was grouped in the following three categories: "(aii) brought into existence by the Plaantiff for the sole purpose of submission to its legal advisers for advice or for use by them in connection with these proceedings; (iii) brought into existence at the request of the Plaintiff's legal advisers solely to enable the Plaintiff's legal advisers to advise the Plaintiff or to conduct these proceedings on its behalf; or (vi) communications between the legal representatives of the parties or nctes of discussions between the parties or their legal representatives which communi: ations and discussions were without prejudice " On 31 August 1981 a notice of motion was filed by the lst, 5th and 7th defendants seeking orders that pursu.int to s.157 of the Act the Commission furnish a true copy of the documents listed in Exhibit Y as follows: "(2) Each document under heading (ii) commencing 21 March 1980 and concluding 25 November 1980 both inclusive -4- (ii) Each document under heading (111) commencing 19 July 1978 and concluding "Undated internal briefing paper of the plaintiff" both inclusive." The dispute whether the copies should be supplied turned upon the application of s.157(1). This is in the following terms: "157.(1) Where - (a) a corporation makes an application to the Commission for an authorization; (b) the Commission gives a notice under sub-section 91(4) to a corporation to which an authorization has been given; (c) a proceeding is instituted agaist a corporation or other person under section 77, 80 or 81; or (ad) an application is made under section 80A or sub-section 87(1A) for an order against a corporation or other person, the Commission shall, at the request %f the corporation or other person and upon payment of the prescribed fee (if any), furnish to the corporation or other person - (e) a copy of every document that has been furnished to, or obtained by, the Commi.,sion in connexion with the matter to which the application, notice or proceeding rela es and tends to establish the case of the corporation or other person; and (£) a copy of any other document in the possession of the Commission that comes to the attention of the Commission in connexion with the matter to which the application, notice or proceeding relates and tends to establish the case of the corporation or other person, not being a document obtained from the corporation or other person or prepared by an officer or professional adviser of the Commission." -5- The first question argued was whether each of the documents referred to was "prepared by an officer of the Commission" and therefore excluded by the last words of the sub-section. The second question was whether each document "tended to establish the case" of any of the defendant corporations. Insofar as the Commission relied upon the words of exclusion, it had to satisfy me in relation to any particular document that it was prepared by an officer of the Commission. Evidence directed to this matter consisted of two affidavits sworn by Miss Hannon dated respectively 10 September and 2 October 1981. I find that the documents in Exhibit Y: with which Miss Hannon was personally concerned, namely, one document in category (11) and ten cocuments in category (iii), had their physical source in her. I further find that at the material times she was an off.cer of the Commission. By her affidavit of 2 October 1981 she also gave evidence, annexing copies of the relevant Commonwealth Government Gazettes, that Glen Catherine Smith, Colin John Dennett, Ronald Solley Gilbert and Edwina Alice '"arton were officers of the Commission. However, at this stege there 1s no evidence before me as to whether any of these »ersons was the physical source of documents with which his o1 her name is associated in the lists in Exhibit Y. Further consideration in relation to the documents with which these four persons are associated has been deferred. This judgment 1s concerned only with the documents associated with Miss Hannon. - 6 = On the second question, whether the documents tended to establish the case of any of the defendants, the applicants had to satisfy me that the documents fell within this description. The applicants, of course, do not have the documents at this stage and are, therefore, unable to give evidence on the subject. However, it was agreed between the parties that the documents in question should be supplied to me for my consideration. Some question was raised whether a Judge sitting in advance of the hearing would be in a position to rule on such a matter. However, the pleadings are complete, the issues are now clear and the task is similar to that which would have to be undertaken in advance of the hearing in relation to disputes about discovery. It ais appropriate for the matter to be determined at this stage. Before dealing with the application of the s.157(1) to the facts of this case, it is necessary to say something about its interpretation. For the lst, 5th and 7th defendants who were the applicants, it was argued that the section 1, aimed at assisting by requiring the furnishing of dociments to a corporation whatever case that corporation may kL- attempting to establish, whether as a plaintiff or a defencant, and by giving the corporation the right to apply for u copy upon offering to pay the prescribed fee. I note that the applicants in the present case offered to pay the prescribed fee, if any. No fee appears to have been prescribed. It was -7- further argued that this right under s.157 involves considera- tions separate from those which ordinarily apply in the case of discovery; and, that the section would override a claim, for example, of professional privilege. Dealing with the exclusion provision, it was submitted that to be excluded a document had to be one of which an officer of the Commission was the author in the true sense, that is to say, a document where cerebral activity on the part of the officer had gone to the production of the contents of the document. It was argued that the exclusion did not apply where the officer had performed a mechanical function as, for example, in recording a telephone conversation or typing the document. On the requirement that the section related cnly to a document which "tends to establish the case" of the corporation, it was submitted on behalf of the applicants that it' was not limited to documents which were admissible in evidence. It was pointed out that not all the proceedings referred to in paragraphs (a), (b), (c) and (da) 2£ s.157(1) were legal proceedings. At least two of the proceedings mentioned were administrative proceedings. "he section therefore was not concerned with niceties of legal evidence or admissibility. The word "tends" was very wide and it was submitted that it would reach to a document which, having regard to its nature, might point to an area of admissible evidence or lead to a line of enquiry. - 8 = For the Commission it was argued that the words "prepared by an officer of the Commission" refer to documents which were "physically sourced" in such a person. It was pointed out that the word "preparation" was used in juxtaposition with the word "obtained". Both had a physical connotation. It was submitted that the word "prepared" meant not authorship of the contents of the document but rather authorship of the document itself, meaning physical authorship. It was pointed out that any other construction would mean that in every cese it would be necessary to determine the extent of the autho-:ship of the ideas in a document and would involve the Court in hearing evidence on the nature and extent of the contribution made, for example, by an interviewer and an interviewee. It was also submitted that in the phrase "tends to establish the case" of the corporation, the word "establish" was used advisedly in contrast to such words as "advance" or "corroborate" or "assist". It was argued it meant tend to establish in an evidentiary sense and that the phrase did not cover a document which merely directed one to a train of enquiry. In approaching the interpretation of s.157 it is convenient to look at the setting in which it occurs. Under ss.155 and 156 the Commission has wide powers of obtaining information and documents and of inspecting and making copies of documents, at least before action is commenced (Brambles Holdings Limited v. Trade Practices Commission (1980) 32 A.L.R. 328; Trade Practices Commission v. Pioneer Concrete -9- (vic) Pty. Limited, 17 August 1981, Full Court, unreported - on appeal to High Court). Sections 155 and 156, when used appropriately, should mitigate the difficulty under which the Commission labours in proceedings seeking a penalty, that it cannot obtain discovery or interrogatories (Trade Practices Commission v. George Weston Foods Limited [1979] A.T.P.R. 18,244 at p.18,250). Whether a corporation should retain, the privilege of declining discovery and interrogatories in such proceedings may require consideration. Tne reasons underlying the rule are to a large extent inapplicable in the case of a corporation (see Wigmore, Evidence, 1961, Vol.8, para.2259(a), p.353). The risk of incurring a penalty may be relatively small compared with the risk of l:ability for damages in a civil action. In the present case the Commission has i-self given discovery and has answered interrogatories. The right now sought to be exercised under s.157 is supplementary to these procedures. The intention disclosed by the wording of s.157 in relation to proceedings under ss.77, 80, 80A, i' or 87(1A) is that a corporation is to be given fair treatment, in the sense that it 1s to be given copies of documen!: which the Commission has and which would, speaking broadly, support the corporation's case. This may be compared with tix: obligation Placed upon a prosecutor, who knows of a credible witness who can supply material facts which tend to show an accused is innocent, to make the witness or his statement available to the defence (see Archbold, Criminal Pleading, B&vidence and -10- Practice, 40th Edn., p.281, para.443; see also Maddison v. Goldrick [1976] 1 N.S.W.L.R. 651 at p.668). In my opinion the words "prepared by an officer of the Commission" refer to a document which has been drawn up by the officer, whether or not any particular contribution of ideas is evident in the contents of it. This appears to be the ordinary meaning of the word "prepare" in relation to writings or documents. It is consistent with the position in other fields of the law (see Re Universal Guarantee Pty. Limited; Ex parte Law Institute of Victoria [1954] v.L.r. 650; Ex parte Cowley-Cooper; Re Hodgson [1958] S.R. (N.S.W.) 413 at p.414, S.L.R. High Court; Barristers' Board (W.A.) v. Tranter Corporation Pty. Limited [1976] W.A.R. 65 at p.70). Pp: Y Pp It is true that if this interpretation is corre2ct 1t would mean that where a person telephoned the Commission and proceeded to relate facts which would tend tc prove the innocence of the corporation and this conveisation was recorded in a memorandum by an officer of the Co.mission, it would not have to be made available under s.157, whereas if the same person wrote a letter to the Commission setting out the facts favourable to the corporation, this '!etter would have to be made available. On the other hand, if something more than physical authorship is required, it is difficult to define where the line should be drawn. Whatever test would have to be applied it would seem to lead to an awkward enquiry into the intellectual contribution of the officer. The enquiry might be not unlike that which takes place in - ll - determining whether a work 1S an original literary work entitled to copyright. The intent of the exclusion provision seems to be to set on one side readily identifiable classes of documents, namely, those obtained from the corporation itself and those prepared by an officer or a professional adviser. The former would, no doubt, be excluded on the ground that the corporation already had the documents; the second on the ground that the Commission was entitled to have respected the confidentiality of its own internal memoranda. Applying the interpretation I have placed on the word "prepared", I have considered the evidence of Miss Hannon and the documents themselves. My conclusion is that each of the documents was prepared by Miss Hannon. I turn now to the question whether any docume:t "tends to establish the case" of any of the defendants. In my opinion these words do not mean that the documents must tend to place the case of the corporation beyond dispute. It ais, I consider, sufficient if the document supports the case of the corporation and so tends to establish that case (see generally, Vines v. Djordjevitch [1955] A.L.R. 431 at p.434). Although the word "tends" gives the phrase a wide ambit, the word "establish" has a narrowing effect. In my view a document which might suggest some lane of enquiry which could be of assistance to a corporation in conducting its case, does not answer the description of a document which tends to establish that case. - 12 - The document, to fall within s.157, need not be admissible as evidence. It is to be remembered that s.157 applies also to applications to the Commission for authorisation (s.88) and to administrative action by the Commission to revoke an authorisation (s.91(4)). In such cases the notion of admissible evidence is inappropriate. Nevertheless, the idea of documents in such administrative proceedings which tend to establish the case of the corporation 1s quite appropriate. The administrative process is also concerned with issues and with documents having a probative tendency. I have read the pleadings and the documents in question with these considerations in mind. The first defendant in its statement of defence says that it does not admit the allegations in sixteen of the paragraphs of the statement of claim and that it denies (in whole or in part) the allegations in eighteen of them. Pausing here, does s.157(1) apply where the defendant simply puts the plaintiff to proof of its case or simply denies the plaintiff's allegations? Tt might be argued that in this situation a document favouralle to the defendant would more properly be described as lrpeaching the plaintiff's case rather than establishing the defendant's case. However, I do not consider s.157(1) should be narrowly construed. In my opinion, in these circumstances, if a document tends to impeach the plaintiff's case, it tends to establish the defendant's case within the meaning of the section. Continuing, the lst defendant in its statement of defence then alleges, in effect, that no restraint alleged by -13- the plaintiff had or was likely to have a significant effect on competition. Finally, it claims that the Court should in its discretion refuse relief on certain grounds. If any of the documents tended to establish the defendant's case on competition or to establish any of the grounds on which it seeks the exercise of the Court's discretion in its favour, copies of the documents would have to be supplied under s.157(1). The 5th defendant in its statement of defence says that it does not admit certain of the allegations in the statement of claim and denies others. It does not go on to make any allegation about competition or to seek the exercise of the Court's discretion. The statement of defence of the 7th defendant is, with one minor and immaterial difference, identical with that of the lst defendant. My conclusion on the documents submitted is that none of them tends to establish the case of any of these three defendants. One question mentioned in argument was whecher, if a document falis within s.157(1) and is not exs] :ded by the latter words of that section, the Commission may 3till claim legal professional privilege and refuse to supp.y a copy of it. Generally speaking, where a common law rijht such as legal professional privilege is to be abrogatec it may be expected to be done by express words. However, the terms of s.157(1) are so specific it may be that a copy of any such document must be supplied. It is not necessary to express a concluded view on this matter in view of the decision to which I have come on the two questions which were argued before me. - 14+ In the result I conclude that the applicants are not entitled to copies of the documents with which Wynne Patricia Hannon was associated which are referred to in Exhibit Y. The remaining documents are still to be dealt with. % iy LT ecertify that this and the preceding pages are : we Reasons for Ju... ° the Chief Judge, a ivue copy of the } .of his Honour oir Nagel Baven AC Assoc1ate Dated: 4 fof8!