New South Wales Supreme Court CITATION : ASIC v MICHALIK [2004] NSWSC 966 revised - 02/11/2004 HEARING DATE(S) : 15/10/04 JUDGMENT DATE : 15 October 2004 JURISDICTION: Equity Division Corporations List JUDGMENT OF : Barrett J DECISION : Access granted to two affidavits as sought but with certain names masked and without exhibits and annexures CATCHWORDS : PROCEDURE - access to content of court file - application by journalist for access - need to strike balance among competing public interests LEGISLATION CITED : Supreme Court Rules, Part 65 rule 7 Australian Securities and Investments Commission v Michalik [2004] NSWSC 909 Hammond v Scheinberg (2001) 52 NSWLR 49 CASES CITED : Jagelman v Sheahan (as liquidator of Moage Ltd) (2002) 41 ACSR 487 Re Pan Pharmaceuticals Ltd (2003) 176 FLR 341 Scott v Scott [1913] AC 417 Australian Securities and Investments Commission - Plaintiff Andrzej Janusz Michalik also known as Andre Tomaszewski and Stanislaw Konstanty Krawczyk - First Defendant PARTIES : Martin Michalik - Second Defendant Kilahim Pty Ltd - Third Defendant Vanda Carson - Applicant FILE NUMBER(S) : SC 4434/04 Mr D R Stack - Plaintiff COUNSEL : Mr B Slowgrove - Defendants Applicant in person Australian Securities and Investments Commission - Plaintiff SOLICITORS : Dennis & Company - Defendants Applicant in person IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION CORPORATIONS LIST BARRETT J FRIDAY 15 OCTOBER 2004 4434/04 - AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION v ANDREZJ JANUSZ MICHALIK ALSO KNOWN AS ANDRE TOMASZEWSKI AND STANISLAW KONSTANTY KRAWCZYK & ORS JUDGMENT 1 I have before me an application by Ms Vanda Carson, a journalist with The Australian newspaper, for access to two documents in the court file in matter 4434/04 (Australian Securities and Investments Commission v Michalik), being the affidavit of an ASIC senior investigator sworn 10 August 2004 and the affidavit of the defendants' solicitor, Mr Dennis, sworn 7 September 2004. Each of the affidavits was referred to in a judgment I delivered on 5 October 2004 September, although without any detailed description of the content in either case: see Australian Securities and Investments Commission v Michalik [2004] NSWSC 909. 2 Ms Carson's application was made by means of the form of application in Practice Note 97 and, with the consent of Mr Stack who has appeared this morning for ASIC and Mr Slowgrove who has appeared for the defendants, I have treated it as an application for the leave of the court under Part 65 rule 7 of the Supreme Court Rules. Ms Carson has appeared in person. 3 ASIC's position in relation to Ms Carson's application is that it does not object to her having access to either of the affidavits, subject to certain maskings or omissions. The first aspect that ASIC considers should not be disclosed to the press is the names of potential witnesses in possible proceedings by ASIC against the defendants, those potential witnesses being members of the public and others with whom ASIC has had contact about the activities of the defendants. The second aspect that ASIC would not wish to have disclosed is the exhibits to the affidavit of the senior investigator. The third is the search warrants that were annexures to Mr Dennis's affidavit, being search warrants in connection with the investigation of possible contraventions. 4 The position of the defendants is that they would prefer that the press not have access to either of the documents sought by Ms Carson. Mr Slowgrove has put it to me that there would be general prejudice to the defendants if access were granted, although I think in the end, when the exceptions and deletions I have referred to are taken into account, the opposition is not strong and is based on a general desire to minimize potential publicity. 5 The first of the affidavits, that is to say the affidavit of the ASIC investigator, was read before White J when ASIC made an ex parte application on 10 August 2004. The court file reflects, and Mr Stack has confirmed (having appeared on that occasion), that the application was heard in closed court. That is apparently because warrants were about to be executed. The affidavit is therefore not one that has been read in open court. Mr Stack has made it clear, however, that the reason why the court was closed has now been overtaken and the need for confidentiality that existed, from ASIC's point of view, on 10 August does not exist now. 6 The affidavit of Mr Dennis, by contrast, has been read in open court. It was read by Mr Slowgrove when the matter was before me on 27 September 2004. (When I refer to its having been read, I do not, of course, mean that its content was read aloud). 7 As I said when I came on to the bench this morning, I thought it desirable to give notice of Ms Carson's application to the parties and to give them an opportunity to be heard because of the three conflicting public interests that are potentially at work. The first is, of course, the public interest in maintaining a transparent and accessible system of justice. The procedure in which Practice Note 97 plays a part recognises the importance of the principle referred to by Hamilton J in Hammond v Scheinberg (2001) 52 NSWLR 49 at [8] in words spoken by the Earl of Halsbury in Scott v Scott [1913] AC 417, "that every Court of justice is open to every subject of the King". Ensuring (or, at least, not prejudicing) opportunities for fair reporting of legal proceedings by the press is, in a real sense, an aspect of that principle; and, as I have had occasion to say before (Re Pan Pharmaceuticals Ltd (2003) 176 FLR 341; Jagelman v Sheahan (as liquidator of Moage Ltd) (2002) 41 ACSR 487), it would be wrong for any court to proceed on the basis of some a priori assumption that press reporting will be otherwise that objective and responsible. 8 The potentially competing public interests I discern are the public interest in the due and orderly conduct of investigations by law enforcement agencies and the public interest in maintenance of the fundamental privilege against self-incrimination which was, of course, the factor that caused me to decide as I did in the judgment of 5 October 2004. 9 Having heard what has been said by the parties and reviewed again the content of the two affidavits (including exhibits and annexures), I have come to the conclusion that a proper balancing of the competing public interests in the present case justifies the grant of access to part of the material Ms Carson seeks. The public interest represented by ASIC and its powers of investigation will not be compromised if access is given in the restricted way for which Mr Stack contends and I am satisfied, having regard in particular to the content of Mr Dennis's affidavit, that the public interest in the maintenance of the privilege against self-incrimination will not be prejudiced if access to that abbreviated material is given. Likewise, it seems to me that the public interest in open justice will not be materially prejudiced if the elements identified by Mr Stack are excluded from the material to which Ms Carson is given access. 10 My decision is, therefore, that Ms Carson be granted access to the affidavit of Leonard Gordon Foscholo sworn 10 August 2004 (but with the names of the potential witnesses masked and excluding the exhibits to the affidavit) and the affidavit of Bruce Vernon Dennis sworn 7 September 2004 (excluding its annexures). 11 I note that ASIC will now arrange for a copy of the material I have just described to be given to Ms Carson and that the defendants are content with this method of giving effect to my decision. ********** Last Modified: 11/03/2004 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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