CITATION: Handicapped Children's Centre, NSW v Director, Department of Ageing, Disability & Homecare [2003] NSWADT 116 DIVISION: General Division APPLICANT PARTIES: Handicapped Children's Centre, NSW RESPONDENT Department of Ageing, Disability and Home Care FILE NUMBER: 023238 HEARING DATES: On the papers SUBMISSIONS CLOSED: 02/25/2003 DATE OF DECISION: 05/23/2003 BEFORE: Higgins S - Judicial Member APPLICATION: access to documents - business affairs - access to documents - internal working documents - Freedom of Information Act - access to documents - business affairs - Freedom of Information Act - access to documents - internal working documents MATTER FOR DECISION: Principal Matter Administrative Decisions Tribunal Act 1997 LEGISLATION CITED : Freedom of Information Act 1982 (Cth) Freedom of Information Act 1989 CASES CITED: APPLICANT REPRESENTATION: C Rose, agent RESPONDENT J Muddle, solicitor ORDERS: The Department's decision to grant access to the Corben Report, subject to the deletion of personal information, is affirmed. INTRODUCTION 1 On 13 August 2002, by letter, the Department of Ageing, Disability and Home Care ("the Department") advised the Handicapped Children's Centre, NSW ("HCC") that it had received a request from a person ("the FOI applicant") pursuant to the Freedom of Information Act 1989 ("FOI Act") for access to be given to the following documents: - the Funding Agreement between the Department and the HCC ("the Funding Agreement"); and - the Audit report commissioned by the Department on the HCC and prepared by Robert E. Corben Pty Limited ("the Corben Report"). 2 In its letter the Department advised the HCC that it was being consulted pursuant to s.32 of the FOI Act and that it was seeking the HCC's advice as to whether or not the documents were exempt documents by virtue of clause 7 of Schedule 1 of the FOI Act. 3 In a letter dated 18 March 2002, the HCC advised the Department that they objected to the release of both documents pursuant to Schedule 1, Clause 7 of the FOI Act. It also stated that the Corben Report was part of a larger review and could be misleading and damaging if considered out of context and that a disclosure of some of the information contained in the schedules of the Funding Agreement contained confidential client information. 4 In a letter dated 13 August 2002, the Department advised the HCC that it had determined that the FOI applicant be given access to the Corben Report and the Funding Agreement subject to the deletion of exempt material (i.e. personal information) from those documents. 5 In a letter dated 21 August 2002, the HCC advised the Department that it wished to appeal against the Department's decision to give the FOI applicant access to the documents, which had been sought by him. 6 In a letter dated 10 September 2002, the Department advised the HCC that it had reviewed the decision to grant the FOI applicant access to the abovementioned documents, subject to specified deletions, and that it had decided to affirm the earlier decision. Enclosed with the letter was a statement of reasons. 7 On 17 October 2002, the HCC filed an application for review of the abovementioned decision of the Department. JURISDICTION 8 The Tribunal has jurisdiction to hear this application by virtue of s.32(3) of the FOI Act and s.38 of the Administrative Decisions Tribunal Act 1997. CONDUCT OF THE PROCEEDINGS 9 The matter was dealt with at a planning meeting on 28 January 2003 and stood over for further directions on 25 February 2003. On 25 February 2003, the parties having filed their written submissions agreed that the Tribunal was to determine the matter on the basis of the papers that had been filed. 10 Furthermore, the parties informed the Tribunal at the directions hearing, on 25 February 2003, that the only matter, which remained in issue was access to the Corben Report. Agreement had been reached in respect of the Funding Agreement and the annexures to the Corben Report, in the event the Tribunal affirmed the Department's decision. RELEVANT LEGISLATION 11 S.5(2)(b) of the FOI Act confers on each member of the public: "…a legally enforceable right to be given access to documents held by the Government, subject only to such restrictions as are reasonably necessary for the proper administration of the Government." 12 The government agency on whom a request for access to documents has been made is required to consider the application and is then required to give access to the documents being sought unless it can establish that the document is an exempt document under one or more of the provisions contained in Schedule 1 of the FOI Act. The burden of proof lies on the agency or Minister to establish that the exemption applies and the denial of access is justified (see s.61 of the FOI Act). 13 Where an application is made for access to documents that affect the business affairs of a third person (i.e. a person other than the government agency to whom the request is made and the FOI applicant), s.32 of the FOI Act provides that the government agency is required to consult with that third person prior to giving access to the document. That section, in so far as it is relevant, provides as follows: "32 (1) This section applies to a document that contains: (a) information concerning the trade secrets of any person; or (b) information (other than trade secrets) that has a commercial value to any person; or (c) information ( other than trade secrets or information referred to in paragraph (b) ) concerning the business, professional, commercial or financial affairs of any person. (2) An agency shall not give access to a document to which this section applies (otherwise than to the person concerned) unless the agency has taken such steps as are reasonably practicable to obtain the views of the person concerned as to whether or not the document is an exempt document by virtue of clause 7 of Schedule 1. (3) …" 14 As mentioned above, the exemptions on which a government agency can rely for refusing access to a document are contained in Schedule 1 of the FOI Act. So far as is relevant to this application, the schedule contains the following exemptions: Documents Affecting Business Affairs Cl.7.(1) A document is an exempt document: (a) if it contains matter the disclosure of which would disclose trade secrets of an agency or any other person; or (b) if it contains matter the disclosure of which: (i) would disclose information (other than trade secrets) that has a commercial value to any agency or any other person; and (ii) could reasonably be expected to destroy or diminish the commercial value of the information; or (c) if it contains matter the disclosure of which: (i) would disclose information (other than trade secrets or information referred to in paragraph (b)) concerning the business, professional, commercial or financial affairs of an agency or any other person; and (ii) could reasonably be expected to have an unreasonably adverse effect on those affairs or to prejudice the future supply of such information to the government or to any agency. (2) A document is not an exempt document by virtue of this clause merely because it contains matter concerning the business, professional, commercial or financial affairs of the agency or other person by or on whose behalf an application for access to the document is being made. (emphasis added) Internal Working Documents Cl.9(1) A document is an exempt document if it contains matter the disclosure of which: (a) would disclose: (i) any opinion, advice or recommendation that has been obtained, prepared or recorded; or (ii) any consultation or deliberation that has taken place, in the course of, or for the purpose of, the decision making functions of the Government, a Minister or an agency; and (b) would, on balance, be contrary to the public interest. (2) a document is not an exempt document by virtue of this clause if it merely consists of: (a) matter that appears in an agency's policy document; or (d) factual or statistical material. 15 S.59A of the FOI Act prescribes certain matters which are irrelevant to the consideration of whether the disclosure of a document would be contrary to the "public interest". That section provides as follows: "s.59A For the purpose of determining under this Act whether the disclosure of a document would be contrary to the public interest it is irrelevant that the disclosure may: (a) cause embarrassment to the government or a loss of confidence in the government, or (b) cause the Applicant to misinterpret or misunderstand the information contained in the document because of an omission from the document or for any other reason." EVIDENCE 16 It is not disputed that the Corben Report was commissioned by the Ageing and Disability Department, which appears to be the predecessor to the current Respondent Department. Nor is it disputed that the report consists of an examination of HCC's financial situation at a particular time and an examination of the former Department's funding relationship with that organisation. The report also made a number of recommendations on the matters that were examined. 17 Furthermore, it is not disputed that many of the documents attached to the report are documents generated by the HCC, most of which are and have been in the public domain for some time. SUBMISSIONS Applicant's Submissions 18 The written submissions of the HCC make reference to the Commonwealth Act (Freedom of Information Act 1982 (Cth)), however, the Tribunal has considered the submissions in the context of the equivalent provisions under the NSW FOI Act. 19 The HCC argues that the exemptions in clauses 7 and 9 apply to the Corben Report. 20 In its submissions, the HCC has stated that: "… the disclosure to this particular Applicant would "unreasonable affect" the HCC in relation to its lawful business and financial affairs". The submissions also state that the HCC has had a long and challenging relationship with the FOI applicant. Respondent's Submissions 21 In its submission the Department argues that the HCC, who was consulted pursuant to s.32 of the FOI Act, which expressly refers to the business affairs exemption in clause 7 of Schedule 1, are restricted in their application before the Tribunal seeking review of the Department's decision on this ground only. That is, they are unable to rely on any other exemption clause in Schedule 1. 22 In respect of the clause 7 exemption the Department concedes that the Corben Report comes within the terms of s.7(c)(i) of Schedule 1 of the FOI Act. However, it goes on to argue that subparagraph 7(c)(ii) cannot be satisfied. In this regard it argues that the HCC must establish that access to the document would "disadvantage" or have an "unreasonable adverse effect" on the "competitive position" of the business of HCC. It then argues that it would be difficult for the affairs of a non-profit organization, such as the HCC, to meet this criteria. 23 The Department goes on to argue that, in the event the Tribunal were to find that the HCC was entitled to rely on grounds other than clause 7 of Schedule 1 of the FOI Act, the Department argues that the majority of the Corben Report consists of factual and statistical information and would be excluded from the exemption in clause 9 by virtue of clause 9(2). DECISION 24 This application raises the following issues for determination: (a) is the HCC restricted as to the grounds on which it may rely in its application for review? (b) on the material before the Tribunal and any relevant law, is the Corben Report an exempt document under clause 7(c) of Schedule 1 of the FOI Act; and (c) if it is found that the HCC is not restricted as to the grounds on which it may rely in its application for review, is the Corben Report an exempt document under the terms of clause 9(1) of Schedule 1 of the FOI Act. Grounds on which the Applicant may rely 25 As mentioned above, it is not disputed that the Corben Report contains information concerning the business professional, commercial and financial affairs of HCC. Nor is it disputed that the Department was required to consult with HCC after it received a request from a member of the public for access to the report under the FOI Act. The consultation was required pursuant to s.32(2) of the FOI Act. That subsection also expressly sets out the nature of the consultation. That is, the Department was required to "obtain the views" of the HCC "as to whether or not the document is an exempt document by virtue of clause 7 of schedule 1". 26 In this application, the Department's letter of consultation was in accordance with the terms of s.32(2) of the FOI Act. 27 In my opinion, the question of whether the HCC is restricted as to the grounds on which it may rely in its application to the Tribunal must be determined having regard to the language of the provision concerned, the structure of the FOI Act and the overall objectives of that Act. 28 A literal reading of s.32 of the FOI Act supports a narrow interpretation of this section and in my opinion, for the reasons stated below, this is further supported by the structure of the Act and its objectives. 29 The first matter to be noted is that the section is contained in Division 2 of Part 3 of the FOI Act. This Division contains provisions that exclusively deal with consultation with third parties ("third party consultation provisions"). That is, parties other than the government agency from whom access is being sought and the FOI applicant. These provisions also relate to documents that relate to or "concern" four specified matters of third parties. These are as follows: a) documents concerning intergovernmental relations (s.30, FOI Ac t ); b) documents concerning personal affairs (s.31, FOI Act); c) documents concerning business affairs (s.32, FOI Act); and d) documents concerning conduct of research (s.33, FOI Act). 30 In respect of each of these specified matters, there is an equivalently named exemption contained in Schedule 1 of the FOI Act as follows: (a) Intergovernmental relations – clause 5 of Schedule 1; (b) Personal affairs – clause 6 of schedule 1; (c) Business affairs – clause 7 of schedule 1; and (d) Conduct of research – clause 8 of schedule 1. 31 Each of the third party consultation provisions expressly provide that once the government agency has determined that a document, for which access is sought, does concern a third party in respect of any of the abovementioned specified matters, the government agency is required to obtain the views of the third party as to whether or not the document is an exempt document in relation to that specified matter. For example, where a document held by a government agency contains information concerning the "personal affairs" of a third party, s.31(2) of the FOI Act requires the government agency to seek the views of the third party as to whether or not the document is an exempt document under clause 6 of schedule 1 of the FOI Act, which relates to "personal affairs". 32 Each of the third party consultation provisions also provides that where consultation has taken place and the third party has advised the government agency that they are of the view that the document is exempt in relation to the specified matter, the government agency may never the less decide to give the FOI applicant access to the document. However, if it does make such a decision the government agency is required to give written notice to the third party of its decision, as well as the third party's right of review and appeal in respect of this decision (ss.30(3), 31(3), 32(3) and 33(3), FOI Act) 33 In my opinion, the fact that the third party consultation provisions are all contained in one division of the FOI Act, they are all in similar terms and of similar effect and that they each relate to a specified matter for which consultation is required indicates that Parliament intended to limit the scope of the consultation to specific exemptions under Schedule 1 of the FOI Act. This includes the scope on which the third party may express its views and for which it may seek review. 34 Such a construction is supported by the overall objectives of the FOI Act, which is to give any member of the public a legally enforceable right to access to documents held by a government agency, who is required to grant access unless it can establish that the document is exempt under one or more of the clauses contained in schedule 1. Where a document for which access is sought relates to or concerns a third party in respect of one or more of the specified matters contained in the third party consultation provisions, it is logical that the third party be consulted. In many instances that party may be the only party that can provide the government agency with the basis on which the specified exemption can be relied on in order to refuse access. What the third party consultation provisions do not do is to provide the third party with a legal basis on which it can direct the government agency to refuse access to a document that comes within the terms of any of the specified exemptions in those provisions or any other exemption. That decision remains with the government agency, who is able to grant access to the document even if it is an exempt document (s25 FOI Act). 35 Accordingly, in my opinion, a third party, which has been consulted pursuant to any of the third party consultation provisions, is limited in its application for review of a decision of a government agency to grant access to a document that concerns one or more of the specified matters contained in those provisions to grounds, which relate to one or more of the exemptions contained in these provisions. This does not mean that a third party is prohibited from expressing its views to the government agency on the document coming within any of the other exemptions contained in schedule 1 of the FOI Act. However, the government agency's refusal to accept those views cannot be the subject of a review application before the Tribunal. 36 For the reasons stated above, in my opinion, the HCC is limited in its application for review to the grounds contained in clause 7 of schedule 1 of the FOI Act. It is unable to rely on the grounds of the exemption clause 9 of schedule 1 as this is not one of the exemptions referred to in the third party consultation provisions. Corben Report – Is it an exempt document under clause 7(c) of schedule 1 37 As I have already mentioned, the parties agree that the Corben Report comes within the terms of s.32(1)(c) of the FOI Act. Accordingly, it is a document that comes within the terms of clause 7(c)(i) of schedule 1 of the Act. The question is whether it also comes within clause 7(c)(ii) of schedule 1 and is thereby an exempt document. 38 There are two limbs to clause 7(c)(ii) of schedule 1, of which only one limb needs to be satisfied. The first limb applies where it is established that the disclosure of the document in question "could reasonably be expected to have adverse effect on the business, professional, commercial or financial affairs of the third party". 39 The second limb applies where it is established that the disclosure of the document in question could reasonably be expected "to prejudice the future supply of such information to the Government or to an agency". 40 In this application there is no evidence that the HCC, who the Tribunal notes provided its assistance in the preparation for Corben Report, including the provision of financial documents generated by the HCC, would in the future refuse to provide such assistance or information to the Department if the document is disclosed to the FOI applicant. Nor has the HCC made any submissions in this regard. 41 Accordingly, the second limb of clause 7(c)(ii) of schedule 1 of the FOI Act is of no relevance to this application. 42 This leaves the first limb of clause 7(c)(ii) of schedule 1 of the FOI Act, which has three aspects that need to be established in order for the document to be exempt. These are: a) the effect of disclosure will be adverse to the business, professional, commercial or financial affairs of the third party; b) the adverse effect is unreasonable; and c) the adverse effect is expected to occur. 43 In this case, the HCC's evidence is that the Corben Report contains inaccuracies and is outdated. It also states that the FOI applicant, who is well known to the HCC, is likely to misuse the information contained in the report. In particular, he will create additional work for the HCC. However, the Tribunal has no evidence before it as to the nature of this additional work and how this additional work will effect the business, professional, commercial or financial affairs of the HCC and that this effect is of an adverse nature that is unreasonable. Nor is there any evidence that this additional work is expected to occur, other than the assertions that were made in submissions. 44 In my opinion, having regard to the overall objectives of the FOI Act, it is not sufficient for the HCC to merely assert that the information contained in the report is inaccurate and that the FOI applicant will misuse the information. It was required to satisfy the Department and now the Tribunal through the presentation of evidence that the release of the Corben report will have an effect on its business etc., that adverse effect was unreasonable and that it was expected to occur. 45 I do not accept the Department's submissions that clause 7(c)(ii) of schedule 1 of the FOI Act required the HCC to establish that disclosure of the Corben Report would have an "unreasonable adverse effect" on the "competitive position" of its business and as it was a non-profit organisation it could not have a competitive position. Such an interpretation of this particular clause would limit its operation to all businesses other than non-profit organisation. There is nothing in the wording of clause 7(c)(ii) which would justify such a construction. Indeed, the contrary would be the case as government agencies, particularly those providing services such as the respondent Department, regularly deal with businesses, which are non-profit and retain information from or about such businesses. If Parliament had intended such agencies to be excluded from relying on the exemption in clause 7(c)(ii) of schedule 1 of the FOI Act, it would have expressly provided for such. 46 As the Tribunal has determined that the HCC is limited to the grounds set out in clause 7(c)(ii) of schedule 2 of the FOI Act in its application for review; it is unnecessary to consider whether the Report comes within the exemption contained in clause 9 of the schedule. 47 For the reasons stated above, the Tribunal is of the opinion that the Department's decision is the correct and preferred decision. 48 The Tribunal orders that the Department's decision to grant access to the Corben Report, subject to the agreed deletion of personal information, is affirmed. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.