Reported Decision: 70 NSWLR 231 Appeal Outcome: Special leave application granted by the High Court - 7 March 2008; Appeal dismissed - 6 August 2008 - Hearne v Street [2008] HCA 36 New South Wales Court of Appeal CITATION: Street & Ors v Hearne & Anor [2007] NSWCA 113 This decision has been amended. Please see the end of the judgment for a list of the amendments. HEARING DATE(S): 03/05/2007 JUDGMENT DATE: 17 August 2007 JUDGMENT OF: Ipp JA at 1; Basten JA at 123; Handley AJA at 143 DECISION: (1) Appeal upheld; (2) Orders of Gzell J set aside, and, in lieu thereof, orders adjudging Mr Hearne and Mr Tierney guilty of the contempt in the first charge in the Statements of Charge; (3) Notices of Motion remitted to Gzell J for hearing as to penalty, and to determine the appropriate orders for the costs of the first hearing; (4) Mr Hearne and Mr Tierney to pay the costs of the appeal; (5) Mr Hearne and Mr Tierney to have certificates under the Suitors Fund Act 1951 (NSW) for the cost of the appeal CATCHWORDS: CONTEMPT OF COURT – implied undertaking by litigant not to use documents served by opposite party except for proper purposes of the litigation – whether binding on servants and agents of litigant. - CONTEMPT OF COURT – breach of undertaking to Court – civil or criminal – distinction. - CONTEMPT OF COURT – appeal from acquittal – whether competent. - CONTEMPT OF COURT – third parties who aid and abet breach of injunction or undertaking – civil or criminal. - APPEAL – Acquittal on charge of contempt – whether appeal competent. Courts Legislation Amendment Act 1996 (NSW) Federal Court of Australia Act 1976 (Cth) Luna Park Site Act 1990 (NSW) Luna Park Site Amendment (Noise Control) Act (2005) Parliamentary Privileges Act 1987 (Cth) LEGISLATION CITED: RSC 1883 RSC 1962 Suitors Fund Act 1951 (NSW) Supreme Court Act 1970 (NSW) Trade Practices Act 1974 (Cth) Crown Lands Act 1989 (NSW) Abigroup Ltd v Akins (1997) 42 NSWLR 623 A-G for Tuvalu v Philatelic Distribution Corporation Ltd [1990] 1 WLR 926 CA A-G v Times Newspapers Ltd [1992] 1 AC 191 Ainsworth v Hanrahan (1991) 25 NSWLR 155 Alterskye v Scott [1948] 1 ALL ER 469 Attorney-General (NSW) v Quin (1990) 170 CLR 1 Australasian Meat Industry Employees' Union & Ors v Mudginberri Station Pty Ltd (1986) 161 CLR 98 Australian Building Construction Employees' and Builders Labourers' Federation v David Syme and Company Ltd (1982) 59 FLR 48 Australian Consolidated Press Ltd v Morgan (1965) 112 CLR 483 Biba Ltd v Stratford Investments Ltd [1973] Ch 281 Bourns Inc v Raychem Corp [1999] 1 All ER 908 British American Tobacco Australia Services Ltd v Cowell [2003] VSCA 43, (2003) 8 VR 571 Central Queensland Cement Pty Ltd v Hardy [1989] 2 Qd R 509 Director General of Fair Trading v Pioneer Concrete (UK) Ltd [1995] 1 AC 456 Distillers Co (Biochemicals) Ltd v Times Newspapers Ltd [1975] QB 613 Esso Australia Resources Ltd v Plowman (1995) 183 CLR 10 Fardon v Attorney-General (Qld) (2004) 223 CLR 575 Hamersley Iron Pty Ltd v Lovell (1998) 19 WAR 316 Harman v Secretary of State for the Home Department [1983] 1 AC 280 He Kaw Teh v The Queen (1985) 157 CLR 523 Heatons Transport (St Helens) Ltd v The Transport and General Workers Union [1973] AC 15 Hopkinson v Lord Burghley (1867) LR 2 Ch Ap 447 John Fairfax Publications Pty Ltd v A-G (NSW) [2000] NSWCA 198 (2000) 181 ALR 694 CASES CITED: Jones v Sutherland Shire Council [1979] 2 NSWLR 206 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 Mahon v Rahn (No 1) [1998] QB 424 Marengo v Daily Sketch and Sunday Graphic Ltd [1948] 1 All ER 406 Markisic v Commonwealth of Australia [2007] NSWCA 92 Microsoft Corporation v Marks (No 1) (1996) 69 FCR 117 Moage Ltd (in liq) v Jagelman (2002) 43 ACSR 173 North Sydney Council v Roman [2007] NSWCA 27, (2007) 150 LGERA 419 O'Chee v Rowley (1997) 150 ALR 199 O'Shea v O'Shea and Parnell [1890] 15 PD 59 Pacific Basin Exploration Pty Ltd v XLX (NL) (1984) 2 IPR 489 Phonographic Performance Ltd v Amusement Caterers (Peckham) Ltd [1964] Ch 195 Prudential Assurance Company Ltd v Fountain Page Ltd [1991] 1 WLR 756 at R v Loughnan [1981] VR 443 Rank Film Ltd v Video Information Centre [1982] AC 380 Riddick v Thames Board Mills Ltd [1977] QB 881 Rivlin v Bilainkin [1953] QB 485, 488 Seaward v Paterson [1897] 1 Ch 545 CA Spalla v St George Motor Finance Ltd (2004) 209 ALR 703 Stancomb v Trowbridge Urban District Council [1910] 2 Ch 190 Stingel v The Queen (1990) 171 CLR 312 Taylor v Serious Fraud Office [1999] 2 AC 177 Watkins v AJ Wright (Electrical) Ltd [1996] 3 All ER 31 Witham v Holloway (1995) 183 CLR 525 A1: Joan Street A2: Ros Dwyer A3: Michael Hesse A4: Glen Eight Pty Ltd PARTIES: A5: Susan Hesse A6: Robert Simkin A7: Glen Frederick Billington A8: Fiona Billington R1: Peter Hearne R2: David Tierney FILE NUMBER(S): CA 40692/2006 COUNSEL: Appellants: TA Alexis SC/Ms PM Sibtain Respondents: TGR Parker SC/MH Baird SOLICITORS: Appellants: Wise Legal Respondents: Clayton Utz LOWER COURT JURISDICTION: Supreme Court - Equity Division LOWER COURT FILE NUMBER(S): SC 2267/2005 LOWER COURT JUDICIAL OFFICER: Gzell J LOWER COURT DATE OF DECISION: 23/06/2006 LOWER COURT MEDIUM NEUTRAL CITATION: [2006] NSWSC 624 IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40692 of 2006 IPP JA BASTEN JA HANDLEY AJA FRIDAY 17 AUGUST 2007 JOAN PAULA STREET & ORS v PETER HEARNE & ANOR CATCHWORDS CONTEMPT OF COURT – implied undertaking by litigant not to use documents served by opposite party except for proper purposes of the litigation – whether binding on servants and agents of litigant. CONTEMPT OF COURT – breach of undertaking to Court – civil or criminal – distinction. CONTEMPT OF COURT – appeal from acquittal – whether competent. CONTEMPT OF COURT – third parties who aid and abet breach of injunction or undertaking – civil or criminal. APPEAL – acquittal on charge of contempt – whether appeal competent. HEADNOTE In proceedings pending in the Equity Division the appellants, who were adjoining occupiers, sued the proprietors of the Luna Park complex on lease from the Crown, inter alia to restrain nuisance by noise. Directions were given for the filing of affidavits and the exchange of expert reports. It was common ground that these were the subject of implied undertakings or obligations to the Court imposed on the litigants by law that such documents would not be used except for the proper purposes of the litigation. The respondents, one a director of the first defendant, and another who had an official position with its parent company, but was active in its affairs, disclosed documents covered by the implied undertaking or obligation to the relevant Minister and her staff in an attempt, which was successful, to have Parliament pass legislation to protect the proprietors of Luna Park from claims for noise nuisance. The plaintiffs in the principal proceedings applied to have the respondents dealt with for contempt of court for breach the implied undertaking or obligation claiming that, as officers of the first defendant, they were personally bound by its undertaking or obligation. Gzell J held had the respondents were not personally bound and dismissed the proceedings for contempt. The plaintiffs appealed. HELD: (1) (by majority) the proceedings were for civil contempt and the appeal was competent; (2) (by majority) the respondents were personally bound by the implied undertaking or obligation to the Court given by the first defendant not to use the documents except for the proper purposes of the litigation; (3) (by majority) the respondents had committed a breach of the implied undertaking and were guilty of contempt of court; (4) per Handley AJA since the documents disclosed to the Minister and her staff had been used by her for the business of Parliament the Court should invite further argument on whether that use was protected by Parliamentary privilege. ORDERS (1) Appeal upheld (2) Orders of Gzell J set aside, and, in lieu thereof, orders adjudging Mr Hearne and Mr Tierney guilty of the contempt in the first charge in the Statements of Charge; (3) Notices of Motion remitted to Gzell J for hearing as to penalty, and to determine the appropriate orders for the costs of the first hearing; (4) Mr Hearne and Mr Tierney to pay the costs of the appeal; (5) Mr Hearne and Mr Tierney to have certificates under the Suitors Fund Act 1951 (NSW) for the cost of the appeal. ********** IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40692 of 2006 IPP JA BASTEN JA HANDLEY AJA FRIDAY 17 AUGUST 2007 JOAN PAULA STREET & ORS v PETER HEARNE & ANOR Judgment 1 IPP JA: The appeal against the dismissal of the contempt charges 2 The appellants appeal against the decision of Gzell J (Street & Ors v Luna Park Sydney Pty Ltd & Anor [2006] NSWSC 624) whereby his Honour dismissed charges of contempt of court brought by them against the first respondent (Mr Peter Hearne) and the second respondent (Mr David Tierney). 3 The contempts alleged were based on "implied undertakings", which, according to the appellants, the respondents gave to the court. The appellants contended that, by the implied undertakings, Mr Hearne and Mr Tierney undertook not to use affidavits and expert reports, served on them by the appellants in the course of certain legal proceedings (the "Main Proceedings"), for any purpose not directly connected with the conduct of those proceedings. 4 The Main Proceedings involved a claim by the appellants against Luna Park Sydney Pty Ltd ("LPS") and Metro Edgley Pty Ltd ("Metro") based on "noise nuisance" arising out the conduct of rides in Luna Park. 5 The appellants contended that Mr Hearne and Mr Tierney breached the implied undertaking and committed contempt of court by transmitting, to the Minister for Tourism, Sport and Recreation, The Hon Sandra Nori MP, and Mr Marcus Schintler of her office, extracts from an affidavit by one of the appellants, Mrs Hesse, sworn on 30 June 2005, and a "noise impact assessment report" by Dr R Tonin, dated 26 May 2005. The appellants contended that Mr Hearne and Mr Tierney transmitted these documents (which had been filed in the Main Proceedings) for a purpose unconnected with the Main Proceedings. The facts relied on by the appellants 6 Mr Hearne was the managing director and chief executive officer of LPS. Mr Tierney was "strategic advisor" to Multiplex Developments Australia Pty Ltd ("Multiplex"). Multiplex was Metro's ultimate holding company. Mr Tierney was involved on behalf of the respondents in the activities at Luna Park development and in negotiations with the Minister. 7 On 5 April 2005, the appellants, by summons issued out of the Equity Division of the Supreme Court, commenced the Main Proceedings. On 15 April 2005, White J made orders for the filing of experts' reports and further affidavits. Dr Tonin's expert report was filed on 27 May 2005. On 1 July 2005, the matter was listed for trial on 31 October 2005 and set down for hearing for 10 days. White J gave leave for Mrs Hesse to be joined as a fifth plaintiff and, in accordance with his Honour's directions, Mrs Hesse's affidavit, sworn on 30 June 2005, was filed on 4 July 2005 and served on LPS. 8 On 25 July 2005, Mr Hearne transmitted by email extracts from Mrs Hesse's affidavit and Dr Tonin's report to the Minister and Mr Schintler. The email stated that "copy of section [sic] of affidavit of one of the plaintiffs and their acoustic report commenting on the reduction of the mechanical noise of the Ranger ride …" was attached. The Ranger was one of the offending rides in Luna Park, the subject of the Main Proceedings. 9 Mr Hearne also transmitted, as part of the attachments to the 25 July 2005 email, an article from the Daily Telegraph dated 18 April 2005. The article referred to proceedings in the Supreme Court by the appellants against "the amusement park" and stated: "[t]he court is likely to decide in July whether to grant the residents' injunction order to close down five rides". The article referred, in fairly disparaging terms, to allegations made by local residents about the noise from Luna Park and how it interfered with their lives. 10 On 25 July 2005, Mr Hearne asked the Minister to consider introducing legislation to amend the Luna Park Site Act 1990 (NSW) so as to ensure that the operations of Luna Park would be protected against the complaints that were the subject of the Main Proceedings, and any future complaints about noise from Luna Park. 11 On 21 September 2005, Mr Hearne received a draft of the Luna Park Site Amendment (Noise Control) Bill 2005 (NSW). The Bill provided for a maximum noise level at Luna Park. According to the Explanatory Note to the Bill, the proposed legislation: "protects past noise emissions from legal proceedings and other noise abatement action, regardless of the noise level of those emissions, and provides that any such emission is not to be taken to have constituted a public or private nuisance." Implicitly, one of the objects of the Bill was to bring to an end, retrospectively, the appellants' claim in the Main Proceedings based on noise nuisance. 12 On 11 October 2005, the New South Wales government announced the introduction of the Bill to the Legislative Assembly and on 12 October 2005 the Bill was introduced. 13 On 13 October 2005, Mr Tierney transmitted an email to the Minister and Mr O'Grady of her office and forwarded to them the email that Mr Hearne had transmitted on 25 July 2005 together with the attachments to that email. Mr Tierney's email of 13 October 2005 stated: "[The attachments] can be used as good "rhetorical" or debating mat[erial in the] house. It attempts to show how unreasonable the residents are and how outrag[eous some] of their claims have been. Its [sic] obviously issued at the time they lodged their cou[rt proceedings]. The material includes some of the more ridiculous complaints Luna Park had … [sic] some key lines from one of the plaintiff's affidavit [sic] (although this can not be quot[ed] as it could be in contempt of court). But its [sic] what they claim publicly so it can be [used in a] generic sense. Plus the lead Tele article of the time." The copy of the email before the court is not complete and the passages in square brackets are words of which the court was informed by counsel during the hearing on the appeal or words that I have inferred from the context. 14 On 18 October 2005, the Bill was passed and received Royal Assent on 19 October 2005. As a consequence, on 20 October 2005, the hearing date for the trial (which was listed for hearing on 31 October 2005) was vacated. 15 The appellants abandoned their claim based on noise nuisance but amended their pleadings so as to assert breaches of the Trade Practices Act 1974 (Cth) and Crown Lands Act 1989 (NSW) in ways which (according to Mr Alexis SC, who, together with Ms Sibtain, appeared for the appellants) continue to make the noise levels at Luna Park relevant to the Main Proceedings. The additional evidence relating to the competency of the appeal 16 Sub-sections (5) and (6) of s 101 were inserted in the Supreme Court Act 1970 (NSW) by the Courts Legislation Amendment Act 1996 (NSW), which came into force on 2 May 1997. These sub-sections provide: "(5) An appeal lies to the Court of Appeal from any judgment or order of the Court in a Division in any proceedings that relate to contempt (whether civil or criminal) of the Court or of any other court. (6) Subsection (5) does not confer on any person a right to appeal from a judgment or order of the Court in a Division in any proceedings that relate to criminal contempt, being a judgment or order by which the person charged with contempt is found not to have committed contempt." 17 Mr Parker SC, who, together with Mr Baird, appeared for the respondents, relied on these sub-sections in submitting that the appeal was incompetent. The basis of his argument on this issue was that the charges brought against the respondents, and upon which they were acquitted by Gzell J, related to "criminal contempt" for the purposes of s 101(6) of the Supreme Court Act 1970 (NSW) and accordingly, by s 101(6), no appeal lies. 18 Mr Parker relied on additional evidentiary material that he tendered on appeal (and which was admitted) solely for the purposes of the competency argument. This additional material predated the commencement of the contempt proceedings. 19 Mr Parker drew attention to a letter dated 2 March 2006 written by Wise Legal, the appellants' solicitors, to Clayton Utz, who were the solicitors on record acting for LPS in the Main Proceedings. The letter commenced: "We are instructed to write to you in relation to certain conduct of Mr P Hearne, as a director of the first defendant and Mr D Tierney, as a director of the ultimate holding company of the second defendant, assuming that your firm acts for them. If our assumption is incorrect, would you kindly let us know, so that we may write to them directly." 20 Wise Legal's letter referred to the conduct of Mr Hearne and Mr Tierney (the subject of the contempt charge) and contended that both had committed contempt of court. The letter ended by asking whether Clayton Utz could advance any reason why the appellants should not file a notice of motion to have the court deal with Mr Hearne and Mr Tierney for contempt. 21 Clayton Utz replied by letter dated 9 March 2006. They wrote: "Your letter refers to conduct carried out on behalf of Luna Park Sydney Pty Ltd by its officers or agents, Mr Peter Hearne and Mr David Tierney. Accordingly, we are instructed to respond to your letter on behalf of Luna Park Sydney Pty Ltd. We do not have instructions to act on behalf of either Mr Hearne or Mr Tierney in their individual capacities." 22 Despite the fact that Clayton Utz asserted that they were not instructed by Mr Hearne or Mr Tierney, they proceeded to respond to the appellants' allegations against these two men. They wrote: "We understand that Mr Hearne and Mr Tierney were under the impression that only the public dissemination of the affidavits would amount to contempt. This is why Mr Tierney said in his e-mail that the affidavits could not be quoted. Nevertheless, to the extent that the affidavits referred to in the e-mails had not become part of the public domain, the Conduct [the conduct complained of by the appellants] was a breach of our client's undertaking to the Court to use those affidavits solely for the purposes of the proceedings. We have explained to Mr Tierney and Mr Hearne that their impression was mistaken and any dissemination, whether public or not, of material produced on discovery or served in accordance with the court's directions which is not in the public domain is contempt. Our client unreservedly apologises for any such contempt it may have committed. We are instructed to bring this matter to the attention of the Court on 20 March 2006 and make a full apology on behalf of Luna Park Sydney Pty Ltd for any contempt which may have been committed." 23 Wise Legal responded by letter dated 10 March 2006 asserting that the reply was unacceptable and saying, "[i]t is no answer for another party to extend an apology for the conduct and then expect us not to proceed against Mr Hearne and/or Mr Tierney on the basis of that third party apology". They informed Clayton Utz that the appellants had instructed them to proceed against Mr Hearne and Mr Tierney. 24 On 21 April 2006, Clayton Utz replied, saying that they were now acting for Mr Tierney and Mr Hearne. They stated that, in the letter of 9 March 2006, they had conveyed an unreserved apology on behalf of LPS for any contempt that may have been committed. They pointed out that on 20 March 2006, Mr Parker had made a full apology to the court on behalf of LPS for any contempt that may have been committed. They did not convey an apology by Mr Tierney and Mr Hearne or undertaking by them or LPS not to breach the undertaking again. 25 Mr Alexis drew attention to the fact that in Wise Legal's letter of 2 March 2006 the following was said: "By your letter dated 20 April, 2005, the first defendant apologised unreservedly to our clients for releasing affidavits to the media. It provided an undertaking (as requested by our clients) not to release any unread affidavits to the media or any other person not properly connected to the proceedings. The undertaking included directors acting in that capacity. That Mr Hearne breached this undertaking to our clients' [sic] is obvious. The seriousness of the contempt, however, is aggravated by his blatant disregard of the undertaking and the apology for the prior dissemination of unread evidence that was the subject of our clients' prior and immediate complaint. Mr Tierney expressly acknowledges in his email that publication of the plaintiffs' affidavits could be in contempt of Court and yet he did just that to the Minister, as part of the communication that was calculated to ridicule our clients' noise complaints." 26 Mr Alexis submitted that Wise Legal's letter of 2 March 2006 established that LPS had, prior to 20 April 2005, improperly released affidavits to the media and had thereby breached the implied undertaking. He submitted that that letter established that, by its letter dated 20 April 2005, Clayton Utz, on behalf of LPS, had apologised to the appellants for that breach, and LPS had undertaken not to release any unread affidavits to the media or any other person not properly connected to the proceedings. That undertaking "included directors acting in that capacity". Mr Alexis submitted further that on 25 July 2005 and 13 October 2005, LPS, by the conduct of its agents, Mr Hearne and Mr Tierney, had breached the implied undertaking again. 27 Mr Alexis submitted that these matters were relevant to determining whether there was a real prospect of Mr Hearne and Mr Tierney, in the future, disclosing material, the subject of the implied undertaking, to persons not directly involved in the Main Proceedings. 28 Mr Parker drew attention to the fact that the material in Wise Legal's letter of 2 March 2006 relating to LPS's apology of 20 April 2005 was the subject of objection before Gzell J and was not admitted into evidence by his Honour. 29 The ground of objection before Gzell J was relevance. Mr Parker submitted to his Honour that the appellants could not rely on the undertaking of 20 April 2005 and what had occurred in connection with it as that was not a relevant undertaking for the purposes of the contempt charges brought before Gzell J. Mr Parker said to the judge, "the complaint here is about publications that were said to have taken place in July and October and there is no charge in relation to what happened in April". Gzell J held that the material relating to the undertaking of 20 April 2005 might have some relevance to penalty "if the Court ultimately finds there has been a contempt," but held that it was not relevant to the contempt charge. He granted liberty to re-tender should that become necessary in a hearing on penalty. 30 As Mr Parker tendered the letter of 2 March 2006 to this Court for the purpose of determining the competency issue, the whole letter becomes admissible for that purpose: Jones v Sutherland Shire Council [1979] 2 NSWLR 206 at 219 per Samuels JA; J D Heydon, Cross on Evidence (loose-leaf), Vol 1 at [1655] and [1665]. I do not think that any form of selective admissibility can apply to it. In my view, the submissions made by Mr Alexis based on the letter of 2 March 2006 are correct. Drawing a distinction between criminal and civil contempt 31 The respondents' argument as to the competency of the appeal requires the determination of the meaning of "criminal" in the phrase "proceedings that relate to criminal contempt" in s 101(6) of the Supreme Court Act. Sub-sections (5) and (6) of the Act require a distinction to be drawn between civil contempts and criminal contempts. Thus, in determining the competency of the appeal, such a distinction must be drawn, despite the fact that the majority (Brennan, Deane, Toohey and Gaudron JJ) in Witham v Holloway (1995) 183 CLR 525 said (at 534): "The differences upon which the distinction between civil and criminal contempt is based are, in significant respects, illusory." 32 Witham is one of two leading High Court cases where the distinction between criminal and civil contempt is discussed. The other is Australasian Meat Industry Employees' Union & Ors v Mudginberri Station Pty Ltd (1986) 161 CLR 98 ("Mudginberri"). These cases preceded the insertion of sub-sections (5) and (6) in s 101 (by the Courts Legislation Amendment Act 1996 (NSW)). In neither case was the issue the competency of an appeal. In Witham, the High Court was concerned with the onus of proof required to prove contempt of court. Their Honours held that all charges of contempt must be proved beyond reasonable doubt. In Mudginberri, the High Court was concerned with a contempt of court involving the breach of an injunctive order. The observations of their Honours in these cases must be understood in the context of the principal issue in each. 33 In Mudginberri (at 106), the majority (Gibbs CJ, Mason, Wilson and Deane JJ) said: "Punishment for contempt serves two functions: (a) enforcement of the process and orders of the court, disobedience to which has been described as 'civil contempt'; and (b) punishment of other acts which impede the administration of justice, such as obstructing proceedings in court while it is sitting or publishing comments on a pending case, which have both been described as 'criminal contempt'." 34 These observations recognise that disobedience to the process and orders of court is ordinarily described as civil contempt. The implied undertaking - which restricts the use of witness statements (and affidavits) filed by the direction of the court - is part of the process of the court. 35 In Mudginberri, the majority said (at 106): "The principal theoretical basis of the distinction [between a criminal contempt and a civil contempt] is that disobedience to the process and orders of the court in civil proceedings is said to be a civil wrong, a matter between party and party, enforcement being for the private benefit or interest of the party seeking enforcement, whereas impeding the administration of justice is a public wrong. A secondary basis for the distinction is that the main purpose of sanctions for disobedience in civil proceedings is coercive rather than punitive." Their Honours noted, however, that some instances of disobedience to court orders are arbitrarily classified as criminal contempts. 36 The majority was sceptical as to the soundness of these theoretical bases and described them as "unsatisfactory" (at 107). They observed (also at 107): "The theoretical distinction between the two classes overlooks the underlying rationale of every exercise of the contempt power, namely that it is necessary to uphold and protect the effective administration of justice. Although the primary purpose in committing a defendant who disobeys an injunction is to enforce the injunction for the benefit of the plaintiff, another purpose is to protect the effective administration of justice by demonstrating that the court's orders will be enforced." 37 The majority noted (at 108) that: "[V]ery great difficulty has been experienced in maintaining the distinction between civil and criminal contempts and, in particular, in elaborating a precise and certain criterion which divides one class of contempt from the other. … The concept that disobedience to an order becomes criminal when the primary purpose of exercising the power changes from vindication of the rights of the plaintiff to vindication of the authority of the court is both complex and artificial. Salmon L.J. was right when he said in Jennison v. Baker [[1972] 2 QB 32 at 64], speaking with reference to the enforcement of an injunction generally, that '[t]he two objects are, in my view, inextricably intermixed.' When the defendant's disobedience is casual it may readily appear that the primary purpose of exercising the power is to vindicate the plaintiff's rights. On the other hand, when the disobedience is accompanied by public defiance it may as readily be seen that the primary purpose of exercising the power is vindication of the court's authority. But the classification in terms of primary purpose is a more complex and artificial undertaking when the punishment is for wilful disobedience unaccompanied by defiance." 38 Their Honours (at 111 to 112) approved of a line of authorities that distinguished between wilful disobedience accompanied by defiance, on the one hand, and wilful disobedience, in the narrow sense, without defiance, on the other. This distinction recognises that conduct can be "wilful, but not contumacious". 39 Their Honours noted (at 112 to 113) that "lying behind punishment for a contempt which involves wilful disobedience to a court order, is the very substantial purpose of disciplining the defendant and vindicating the authority of the court". For that reason, they held, the Federal Court had the power in cases of civil contempt, where wilful (but not contumacious) disobedience of an injunctive order or undertaking was established, to impose fines as punishment (cf Microsoft Corporation v Marks (No 1) (1996) 69 FCR 117 at 129, 130 per Beaumont J). 40 The majority in Mudginberri held (at 113) that a deliberate commission or omission, in breach of an injunctive order or an undertaking, constituted "wilful disobedience" unless it was casual, accidental or unintentional. Their Honours said that that conclusion disposed of the appellant's submission that there was no power to fine because, on the facts, the appellants' non-compliance with the interlocutory injunction was wilful and not casual, accidental or unintentional. That is, on the basis that a breach of an injunction was wilful (but not contumacious in the broad sense) and was not merely casual, accidental or unintentional, the Federal Court had a power to impose a fine in respect thereof even though the contempt thereby committed was, and remained, a civil contempt. 41 Their Honours went on to say (at 113): "Furthermore, … the original notice of motion showed on its face that the conduct alleged against the appellants went beyond a matter of mere civil contempt, thereby opening up on any view a jurisdiction in the Federal Court to adopt such measures in its discretion, whether punitive or coercive, which would best deal with the contempt". This was an alternative basis for the conclusion that the majority had already reached on the assumption that the contempt charged was a civil contempt. 42 In Witham, the majority (Brennan, Deane, Toohey and Gaudron JJ) said (at 530): "In general terms, the distinction between civil and criminal contempt is that a civil contempt involves disobedience to a court order or breach of an undertaking in civil proceedings, whereas a criminal contempt is committed either when there is a contempt in the face of the court or there is an interference with the course of justice. However, disobedience or breach of an undertaking amounts to a criminal contempt if it involves deliberate defiance or, as it is sometimes said, if it is contumacious." These remarks are entirely consistent with what was said in Mudginberri. 43 Their Honours referred to some orders, involving "arbitrary classification", where disobedience would constitute criminal contempt. Similar comments had been made in Mudginberri (at 107 to 108). Breach of an undertaking does not fall into these categories. 44 The majority (at 531) referred to the distinction between civil and criminal contempt said to lie in the difference between proceedings that are remedial or coercive in the interest of the private individual and proceedings in the public interest to vindicate judicial authority or maintain the integrity of the judicial process. They went on, however (at 532), to say that that distinction was not "a satisfactory basis for the distinction usually made between civil and criminal contempt". They explained: "Even allowing for those orders which, if breached, involve criminal contempt and for contumacious breach, the distinction does not support the general proposition that breach of an order in civil proceedings is a civil contempt. That is because there are some circumstances in which the breach simply cannot be remedied." 45 Their Honours said that the orders made in Witham, itself, illustrated how in some circumstances a breach of an order might not be able to be remedied. In Witham, the respondent obtained an order that the appellant make an affidavit making full disclosure of details of all his property in Australia. The appellant failed to make a full disclosure in terms of the order. The respondent obtained a further order restraining the appellant (to an extent stipulated) from dealing with his property in Australia. The appellant breached both orders. The breaches of these orders could not be remedied and, once they had been breached, their purpose could no longer be achieved. 46 Their Honours returned (at 532) to the distinction between proceedings in the public interest and proceedings that are coercive or remedial in the interest of the private individual. They said: "At best, [that] distinction … supports a separate category of civil contempt to the extent that it clearly appears that the proceedings are remedial or coercive in nature. ... However, in our view, there are fundamental problems even with that approach." 47 Their Honours went on to discuss those "fundamental problems". The first problem identified (at 532) was that there is not a true dichotomy between proceedings in the public interest and proceedings in the interests of the individual. The interests are usually inextricably mixed (at 534). The second problem identified (at 532 to 533) was that all orders are made in the interests of justice and non-compliance "necessarily constitutes an interference with the administration of justice even if the position can be remedied as between the parties". Thirdly, their Honours stated (at 533): "Moreover, there is considerable difficulty with the notion that, in some cases, the purpose or object of the proceedings is punitive and, in others, the purpose or object is remedial or coercive. It should at once be noted that the purpose of the proceedings is not the same as the purpose or object of the individual bringing the proceedings and it is well recognised that, notwithstanding that proceedings are brought by an individual to secure the benefit of an order or undertaking, a 'penal or disciplinary jurisdiction' may also be called into play." Their Honours observed, "proceedings for breach of an order or undertaking have the effect of vindicating judicial authority as well as a remedial or coercive effect". 48 The problems that the majority identified with the distinction between proceedings in the public interest, and those that are remedial or coercive in nature, tend against the notion that that distinction should be accepted, without qualification, in differentiating between civil and criminal contempt for the purposes of determining the competency of the appeal. 49 In context, in my view (and having regard also to what is stated in Mudginberri), their Honours, by the use of the phrase, "At best .." (in the passage quoted in [46], were not intending to convey that what followed was the best means of distinguishing between criminal and civil contempt. Rather, they were saying that the best that could be said for such a test was that it supported "a separate category of civil contempt to the extent that it clearly appears that the proceedings are remedial or coercive in nature". Thus, I do not think that their Honours intended that the test so expressed should be applied, verbatim, in distinguishing between civil and criminal contempt for the purposes of determining the competency of an appeal. 50 In Microsoft Beaumont J said (at [136]): "… the 'substance' or 'object' test is appropriate in our context also. That is to say, if in substance, the proceedings at first instance were criminal in the sense that their object was to punish then – no appeal could lie. On the other hand, if the substance and object of the proceedings were remedial, an appeal was competent." 51 Beaumont J (at 137) referred to the following statement by Lopes LJ in O'Shea v O'Shea and Parnell [1890] 15 PD 59 (at 65): "There are different kinds of attachment for contempt. One kind of attachment is to enforce obedience to an order made in a civil action or proceeding, against one of the parties, in respect of something the doing or not doing of which is not a criminal act. That would not be an order in a 'criminal course or matter' within s 47 … But there is another kind of attachment which is the subject of an independent application against a person who is not a party to the suit in respect of an act done outside the suit, and which act is criminal. That, I think, is within the words of s 47. The application on which the present order was made was an application by the petitioner in the divorce action, in reference to an attempt made be [sic] a stranger to the suit to interfere with the administration of justice in the action, but it is made outside the action. The object of the application was to obtain the punishment of the appellant, and the proceeding ended with the order against him. I am clearly of [sic] opinion that this order was made in a criminal matter." (The emphasis was that of Beaumont J.) And concluded (at 136): "In my opinion, the 'substance' or 'object' test is appropriate in our context also. That is to say, if, in substance, the proceedings at first instance were criminal in the sense that their object were to punish then, as [ Australian Building Construction Employees' and Builders Labourers' Federation v David Syme and Company Ltd (1982) 59 FLR 48] decided, no appeal could lie. On the other hand, if the substance and object of the proceedings were remedial, then an appeal was competent as in any case of an alleged civil contempt." 52 It is helpful to observe how, in Microsoft, Beaumont J applied the test he proposed. His Honour said (at 137): "In characterising the proceedings, it is material, I think, to take into account the circumstance that the moving party is trading, and may be expected to continue to trade. This is consistent with Microsoft's substantial object … being viewed as remedial rather than punitive in character. This also underlines the significance of the proceedings to the individual litigant, Microsoft (i.e. a civil contempt), as distinct from the more general interest of the public in the due administration of justice (i.e. a criminal contempt)." 53 In this passage, Beaumont J took into account the fact that Microsoft was expected to continue to trade and, in doing so, to use a work in respect of which the respondent had infringed the copyright. In other words, his Honour had regard to the utility to Microsoft of an order for contempt against the respondent in a sense likely to be coercive in regard to the respondent's future conduct. 54 It may be accepted that his Honour was having regard (in accordance with the majority in Witham at 533) to the objective purpose and not to the subjective purpose of the individual bringing the proceedings. It may also be accepted that his Honour took into account (as the majority in Witham at 533 envisaged) the fact that, notwithstanding that the proceedings were brought by Microsoft to secure the benefit of the order, a penal or disciplinary jurisdiction was also called into play. 55 Further explication of the way in which Beaumont J determined the "substance" of the proceedings can be seen from two further references to material that he quoted in his reasons. 56 The first is the following passage in the judgment of Bowen CJ, Evatt and Deane JJ in Australian Building Construction Employees' and Builders Labourers' Federation v David Syme and Company Ltd (1982) 59 FLR 48 (at 49): "Contempt of court has traditionally been divided into criminal contempt and civil contempt. In essence, the distinction between the two is that criminal contempt ordinarily consists of the wrongful interference with the due administration of justice while civil contempt ordinarily consists of a refusal or failure to comply with a specific order or direction of, or undertaking given to, a court. The dividing line between the two forms of contempt is, in some cases, unclear … ." The express reference to this passage (at 127) indicates that his Honour considered that the traditional way of distinguishing criminal contempt from civil contempt remained relevant in determining the substance of the contempt proceedings in each particular case. 57 The second is his Honour's italicisation (at 136) of the following part of the judgment of Lopes LJ in O'Shea (to which I have referred above): "The application on which the present order was made was an application by the petitioner in the divorce action, in reference to an attempt made be [sic] a stranger to the suit to interfere with the administration of justice in the action, but it is made outside the action. The object of the application was to obtain the punishment of the appellant, and the proceeding ended with the order against him. I am clearly of [sic] opinion that this order was made in a criminal matter." Plainly, his Honour was of the view that because the application for an order that contempt of court had been committed by Microsoft in proceedings ancillary to its action for infringement of copyright (and not by a stranger to the suit), that was a material factor in determining the substance of the contempt proceedings. 58 The notion underlying the Microsoft test adopted by Beaumont J is that (as is made clear in Witham and Mudginberri), while there are anomalies and difficulties inherent in all the tests that have been used or contemplated, the Federal Court of Australia Act 1976 (Cth) required a distinction to be drawn and the test adopted in Microsoft was the most appropriate means of doing so. 59 In my opinion, the Microsoft test is apt. Nevertheless, I would, with respect, add a qualification. In applying that test in a case where the punishment is for wilful disobedience unaccompanied by defiance, due regard must be had to the fact that (as the majority in Mudginberri observed at 108) classification of the contempt proceedings is a more complex and artificial undertaking. In the latter category of case, when attempting to determine the "substance" of the proceedings, due account must be taken of the following considerations: (a) Notwithstanding that proceedings are brought by an individual to secure the benefit of an order or undertaking, the contempt that arises may be criminal. (b) A breach of an injunctive order or an undertaking that is contumacious in the broad sense involves deliberate defiance, and a breach that is contumacious in the broad sense will be regarded as criminal. (c) Generally, however (and I understand this to mean prima facie), a breach of an injunctive order or an undertaking that is wilful but not contumacious in the broad sense - and is not merely casual, accidental or unintentional - is regarded as a civil contempt (this being the traditional distinction between civil and criminal contempt which still has significance). (d) The fact that the application for an order that contempt has been committed is made within the main action, and not by a stranger to the suit, would tend to show that the contempt is civil in nature. (e) A finding of contempt that is likely to be coercive in regard to the defendant's future conduct would tend to show that the contempt is civil in nature. (f) A breach of an order in civil proceedings may not be a civil contempt where the circumstances are such that the breach cannot be remedied. (g) The competency of the appeal be decided by classifying the contempt proceedings at the time they were instructed. The prima facie position 60 The appellants do not contend that the contempts committed by Mr Hearne and Mr Tierney involved wilful disobedience in circumstances amounting to defiance. The classification, in terms of primary purpose, is therefore of the more complex kind, and requires a consideration of the considerations I have mentioned. 61 As the allegations are of breaches of an implied undertaking that were wilful but not contumacious in the broad sense - and were merely casual, accidental or unintentional - the contempts alleged are prima facie civil. This is the starting point. 62 The applications for orders that contempt has been committed were made within the main action and not by a stranger to the suit. This tends to support the prima facie position. Does the implied undertaking still have a purpose? 63 The breaches of the undertaking that have occurred cannot be remedied. But that does not alone resolve the question whether - as in Witham - the purpose of the undertaking can no longer be achieved. This question is relevant to determining whether there is a remedial purpose in making the orders for contempt that the appellants seek. 64 I discuss below the nature of the implied undertaking in more detailed terms, but at this stage, in order to consider whether the purposes of the undertaking still remain, it is sufficient to state that its purposes are to protect the integrity of the court's processes whereby documents are produced under compulsion, and to protect the privacy of those who are compelled to produce such documents. 65 Mr Parker submitted that, in the light of the Luna Park Site Amendment (Noise Control) Act of 2005, there is no reason for Messrs Hearne and Tierney to breach the undertaking again. But the legislation in question does not apply to the appellants' amended claims. Nor does the submission address the possibility that, as at the date of the contempt proceedings (and thereafter) it might be to the advantage of Mr Hearne and Mr Tierney to influence public opinion, generally, in the way they used the protected documents in the past (that is, by giving the documents to persons for the purposes of enabling them to deride or downplay the appellants' complaints). 66 In my opinion, important purposes can still be achieved in taking steps to deter persons from breaching the implied undertaking in the future. 67 One such purpose is the protection of the appellants' privacy. Mr Hearne and Mr Tierney breached the undertaking by deploying statements made by the appellants to denigrate their complaints about noise from Luna Park. Simply put, in my view, the appellants are entitled to protect their privacy by seeking orders that would deter Mr Hearne and Mr Tierney from acting in the same way again. 68 There is another purpose that remains alive. The noise level at Luna Park is far higher than that usually experienced in areas where people reside. For that reason, the noise level is a matter of public interest. The degree of public interest that it is capable of attracting can be seen from the fact that it excited the attention of the State legislature on an urgent basis. As the appellants' causes of action have changed, it is unlikely that the State Parliament will again show the same degree and urgency of interest in the Main Proceedings. Nevertheless, the continuing importance for the way of life and property values of those affected by the noise means that public opinion about the noise may, at any time, become capable of affecting the interests of those who operate Luna Park. As has been seen in the past, the appellants' documents that are subject to the implied undertaking are capable of being used to influence public opinion against those who complain about the noise levels at Luna Park. 69 The possibilities of impermissible use of the protected documents are many. The purpose of protecting the appellants from impermissible use remains an important purpose of the implied undertaking. Is there a reasonable possibility that Mr Hearne and Mr Tierney might breach the implied undertaking again? 70 In determining the nature of the contempt charges, it is relevant to determine whether there is a reasonable possibility that Messrs Hearne and Tierney might breach the implied undertaking again. That is because the absence of any such possibility militates against a finding that the contempt has a remedial purpose. 71 I pose the question in terms of "reasonable possibility", not a "reasonable probability", as the question is relevant to whether there is a remedial purpose in making a contempt order, not whether an order should be made. 72 For reasons that I later give, I am of the opinion that the implied undertaking applies to Mr Hearne and Mr Tierney. I am further of the opinion that Mr Hearne breached the undertaking on 25 July 2005 and Mr Tierney did so on 13 October 2005. These findings are relevant in considering the inferences that should be drawn from their conduct as a whole. 73 Once there is a possibility that as at the date of the contempt proceedings or thereafter Mr Hearne and Mr Tierney might still be able to benefit themselves or LPS by disclosing the protected material to the public (and I have explained under the previous heading why I think that that is the position), I consider that there is a reasonable possibility that each may breach the implied undertaking. 74 Prior to 20 April 2005, LPS breached the implied undertaking by releasing affidavits to the media. 75 On 20 April 2005, LPS apologised to the appellants for their breach and undertook not to release any unread affidavits to the media or any other person not properly connected to the proceedings. That undertaking "include[d] … directors acting in that capacity". 76 Nevertheless, LPS, by the conduct of its agents, Mr Hearne and Mr Tierney, on 25 July 2005 and 13 October 2005, breached the implied undertaking again. 77 On 9 March 2006, Clayton Utz (LPS' solicitors) conceded: "[T]he Conduct [the conduct complained of by the appellants] was a breach of our client's undertaking to the Court to use those affidavits solely for the purposes of the proceedings." 78 Neither Mr Hearne nor Mr Tierney has explained personally why each again breached the implied undertaking. The only explanation given was that provided in Clayton Utz's letter of 9 March 2006 (on a hearsay basis and, further, not verified on oath). According to that letter, Mr Hearne and Mr Tierney were under the impression that only the public dissemination of the affidavits would amount to contempt. This explanation does not sit easily with the express undertaking given by LPS on 20 April 2005 (said to include "directors acting in that capacity") that unread affidavits would not be released to the media "or any other person not properly connected to the proceedings". 79 In the correspondence between the parties' respective solicitors, Mr Hearne and Mr Tierney, initially, avoided explaining their conduct and providing an apology by not instructing Clayton Utz to write to Wise Legal on their behalf. When so acting for the company alone, Clayton Utz nevertheless conveyed to Wise Legal an explanation for Messrs Hearne and Tierney's conduct on 25 July 2005 and 13 October 2005. Some six weeks later, on 21 April 2006, the solicitors wrote that they were now acting for Mr Hearne and Mr Tierney but conveyed neither an apology nor an undertaking on their behalf. 80 The relevant facts and circumstances do not fill me with confidence that Mr Hearne and Mr Tierney in the future will comply with their obligations under the implied undertaking. In my view, there is a reasonable possibility that, should circumstances change, and should it be to their advantage to disclose the materials subject to the implied undertaking again, they may do so. 81 I accept of course that, an undertaking by a corporation extends to the acts or omissions of the corporation's servants and agents acting in that capacity. I also accept that, if Mr Hearne or Mr Tierney, in acting on behalf of LPS, cause LPS to breach the implied undertaking, the appellants would have a remedy against LPS. Should that occur, the question whether the appellants would have a remedy against Mr Hearne or Mr Tierney would, still, be undecided. Moreover, should Mr Hearne or Mr Tierney breach the implied undertaking otherwise than as a servant or agent or director of LPS, the appellants' rights against LPS would be cold comfort. Conclusion as to the competency of the appeal 82 Taking all the relevant matters into account, I am not persuaded that the prima facie inference as to the civil nature of the contempts alleged has been rebutted. In my view, those contempts should be regarded as civil in nature. It follows, in my view, that the appeal is competent. The nature of the implied undertaking 83 In Hamersley Iron Pty Ltd v Lovell (1998) 19 WAR 316 ("Hamersley"), I made some comments regarding the history and purpose of the implied undertaking that arises in respect of discovered documents. I do not propose to repeat what I there said but I draw from my reasons in that case the following propositions: · A party to litigation who obtains access to documents through the discovery process is obliged not to use those documents for any purpose that is extraneous to the proceedings in which the discovery was made. · The rule is of very long standing and is derived from the need to protect the discovery process. Such an undertaking (as an obligation owed to the court) has been implied since the late nineteenth century. · The expression of the obligation as an implied undertaking given to the court derives from the historical origin of the principle. The obligation has grown from its source as an express undertaking, required as a precondition of discovery, to an obligation which arises by operation of law by virtue of the circumstances under which documents or information are obtained through the court's process. · The restriction of the use of the discovered material is crucial to the discovery process as without it there would be a greater reluctance on the part of parties to make full disclosure and litigants would have a greater temptation to destroy or conceal the existence of relevant documents; the restriction prevents the public interest in discovering the truth from being undermined. · The implied undertaking protects the privacy of persons who, by the process of the Court, are compelled to produce private documents. · There is a public interest in the enforcement of the implied undertaking, even though it also serves individual or private interests; the implied undertaking is necessary to maintain the integrity of the administration of justice. See also Riddick v Thames Board Mills Ltd [1977] QB 881 at 896 per Lord Denning MR, 901 to 902 per Stephenson LJ; Harman v Secretary of State for the Home Department [1983] 1 AC 280 at 300 per Lord Diplock, 308 per Lord Keith of Kinkel; Prudential Assurance Company Ltd v Fountain Page Ltd [1991] 1 WLR 756 at 764 per Hobhouse J; British American Tobacco Australia Services Ltd v Cowell [2003] VSCA 43, (2003) 8 VR 571 at 580, [20] per Phillips, Batt and Buchanan JJA. 84 I would emphasise that the implied "undertaking", so called, is in reality an obligation imposed by law under recognised circumstances. The word "undertaking" in this context is merely an historical label. There is no undertaking of a voluntary kind. The applicability of the "implied undertaking" to the Tonin report and the Hesse affidavit 85 In Central Queensland Cement Pty Ltd v Hardy [1989] 2 Qd R 509, McPherson J (as his Honour then was) said (at 510) that he was "in no doubt" that the implied undertaking was applicable to witness statements as it was to any other document produced by one side to the other for the purposes of litigation. He said (at 511): "A document of this kind [a witness statement], delivered as it was for a particular purpose, may not be used for another purpose. That is an aspect of a general principle not confined to documents delivered for the purpose of litigation." 86 In Ainsworth v Hanrahan (1991) 25 NSWLR 155 (at 166), Kirby P (as his Honour then was) approved Central Queensland Cement. His Honour held that the implied undertaking is applicable to answers to interrogatories. In Abigroup Ltd v Akins (1997) 42 NSWLR 623, Bainton J (at 627 to 628) reviewed the authorities dealing with the issue and concluded that the principles relating to implied undertakings apply to documents or the contents of witness statements ordered to be filed and served under the rules of court or court practice. His Honour referred to a number of authorities that supported this proposition. See also Moage Ltd (in liq) v Jagelman (2002) 43 ACSR 173 at 175 to 176, [11] per Gzell J (where his Honour also conducted a review of the authorities) and Cowell. 87 I did not understand Mr Parker to dispute that Mrs Hesse's affidavit and the Tonin report were subject to the obligations imposed by the implied undertaking. Does the implied undertaking extend to Mr Hearne and Mr Tierney? 88 In Hamersley, Anderson J said (at 334 to 335): "The implied undertaking was certainly binding on the CEPU as a party in the main action and it was also binding on Mr Lovell. The implied undertaking is binding upon anyone into whose hands the discovered documents come, if he knows that they were obtained by way of discovery: see Distillers Co (Biochemicals) Ltd v Times Newspapers Ltd [1975] QB 613 at 621." Pidgeon J and I agreed with Anderson J on this point. 89 Gzell J, in his reasons from which the appellants appeal, said (at [44]): "There is no evidence that Mr Hearne gave any undertaking to the court. The implied undertaking was that of Luna Park Sydney and its solicitors. I do not regard myself as bound by Hamersley Iron on principles of comity to find that Mr Hearne gave an implied undertaking to the court. In the first place, the observations of Anderson J go beyond what was said by Talbot J in Distillers Co." 90 I disagree, with respect, with his Honour's observations. I adhere to my endorsement of what Anderson J said in Hamersley. 91 In the Distillers case, the plaintiffs marketed the drug thalidomide and were sued by various persons who were injured by its side effects (referred to in the judgment as "claimants"). In the course of the actions, the plaintiffs disclosed documents to the claimants under orders for discovery. A claimant gave some of these documents to one of its expert advisors. The expert then agreed to sell information concerning the action, derived from the documents, to The Times. The plaintiffs' solicitors asked the advisor for an undertaking that he would not use the documents for publication. Without disclosing his prior agreement with The Times, the advisor agreed to give the undertaking. The Times then sought to publish an article based on the documents. This gave rise to the interlocutory application to restrain the newspaper from using or disclosing the documents. 92 Talbot J said (at 621): "The plaintiffs claim an overriding protection from publication and use of their documents which there were compelled to disclose in the action against them. They claim that this protection involves those into whose hands the documents come, particularly where the possession was unlawfully obtained. I do not doubt the correctness of this proposition; I do not think that, on the authorities and for the proper administration of justice, it can be argued to the contrary. Those who disclose documents on discovery are entitled to the protection of the court against any use of the documents otherwise than in the action in which they are disclosed. I also consider that this protection can be extended to prevent the use of the documents by any person into whose hand they come unless it be directly connected with the action in which they are produced." 93 The statements by Talbot J in relation to the extension of the protection from publication and the use of disclosed documents were obiter. But, in my view, for the reasons I give below, the principle expressed is as valid for charges of contempt as it is for cases where injunctions are sought to restrain the use or disclosure of protected documents. 94 In a number of cases a party's solicitor has been held to owe the implied undertaking. Harman, itself, is a prime example. The solicitor had the discovered documents in her possession solely in her capacity as a solicitor for her client. A majority of the House of Lords held that the obligation under the implied undertaking was owed directly by the solicitor, and the obligation of the solicitor was not accessorial or ancillary to that of the litigant. 95 In Pacific Basin Exploration Pty Ltd v XLX (NL) (1984) 2 IPR 489, a managing director of a company who had breached the implied undertaking was found guilty of contempt of court. In Watkins v AJ Wright (Electrical) Ltd [1996] 3 All ER 31, the undertaking was imposed on a Mr Wilson, a Scottish solicitor who was not an officer of the English court. Blackburne J (at 43) quoted the following remarks by Lord Roskill in Harman (at 320): "[The implied undertaking arose] on the part of those in whose favour discovery is made in civil litigation (I, of course, include in that expression the solicitors and other agents of those parties) towards those who, as is their obligation in point of law, make that discovery …" Blackburne J then said: "In the light of that passage, and the underlying rationale for the existence of the implied undertaking, I see no basis for confining the scope of the undertaking to those who are parties to the action, to whom discovery has been given, and to the solicitor or solicitors on the record. The undertaking will be of little utility if it did not extend to those like Mr Wilson who, although not on the record in the proceedings (his firm could not be as they were not English solicitors), take upon themselves the day-to-day conduct of the litigation." 96 In Mahon v Rahn (No 1) [1998] QB 424, Staughton LJ said that the rule as to the implied undertaking applied to the parties to the proceedings in which the documents are disclosed, and to those who have access to the documents on their behalf. His Lordship later went further when he said (at 454): "Treating the duty as one which is owed to the court and breach of which is contempt of court also involves the principle that such contempt of court can be restrained by injunction and any person who knowingly aids a contempt or does acts which are inconsistent with the undertaking is himself in contempt and liable to sanctions: see Distillers Co (Biochemicals) Ltd v Times Newspapers Ltd [1975] QB 613." 97 In Bourns Inc v Raychem Corp [1999] 1 All ER 908, Laddie J (at 915 to 916) said: "It is because a party is required to make disclosure for the purpose of particular proceedings that the court will protect it against further dissemination. I think it would be just as much a contempt of court for, say, a shorthand writer or court usher to disclose the discovery documents outside the action as it would be for one of the parties to do so." 98 In Spalla v St George Motor Finance Ltd (2004) 209 ALR 703, Ryan J at (at 717, [40]) accepted that "the undertaking must bind the litigant by whom it is given and his or her privies". 99 The authorities that I have cited all support the proposition that the implied undertaking is not limited to the parties to an action. Once it is not so limited, the explanation for holding that the implied undertaking must be derived from circumstances other than a party's direct involvement in the proceedings. 100 The authorities explain that the implied obligation arises by operation of law simply by virtue of the circumstances under which documents are produced and obtained. Once documents are produced and obtained compulsorily, by reason of the court's process, then, as Lord Denning MR said in Riddick v Thames Board Mills (at 896), the courts should not allow "the other party, or anyone else, to use the documents for any ulterior or alien purpose". His Lordship pointed out that otherwise the courts, themselves, would be doing injustice. Stephenson LJ (at 901 to 902) echoed these sentiments when saying, "it is important to the public and in the public interest that the protection [afforded by the implied undertaking] should be enforced against anybody who makes improper use of it". Otton LJ (with whom Schiemann LJ agreed) applied these statements in Mahon. 101 Thus, the rationale for the wide-ranging applicability of the rule is the notion that the obligation not to use documents subject to the implied undertaking is imposed by law in the public interest and to prevent injustice towards those who are compulsorily required by process of law to produce such documents. 102 In the present case, Mr Hearne and Mr Tierney had access to the documents in question on LPS' behalf. In sending the emails of 25 July 2005 and 13 October 2005 to the Minister and others, Mr Hearne and Mr Tierney were acting as LPS' agents. They fall squarely within the category recognised in Harman, Hamersley, Watkins, Mahon and Spalla. 103 In any event, in my view, applying what I have described as the rationale for the rule, and following what was said in the passages to which I have referred in the Distillers case, Riddick, Harman, Hamersley, Mahon and Bourns Inc v Raychem, the rule applies to all persons into whose hands the discovered documents come, if they know that the documents were obtained by way of discovery or other compulsory court process. The Court should not allow such persons to use those documents for purposes other than those for which they have been disclosed. The need for knowledge of the undertaking 104 Mr Parker submitted that the appellants had to prove that Mr Hearne and Mr Tierney knew of the implied undertaking. In my view, however, the appellants only had to prove the facts that gave rise to the obligation imposed on Mr Hearne and Mr Tierney by law. As Blackburne J said in Watkins v AJ Wright (Electrical) Ltd (at 41): "I cannot accept the submission that ignorance of the implied undertaking provides a person with a defence to proceedings for contempt arising out of his breach of the implied undertaking. As is well known, the implied undertaking arises by implication of law on the giving of discovery in the course of a civil action where discovery is required to be given." (See also at 42.) 105 In my opinion, knowledge that the pending Main Proceedings were pending and the fact that the documents that had come into the possession of Mr Hearne and Mr Tierney were produced in accordance with the court's processes was sufficient to cause an obligation to be imposed on each of them, by law, not to use the documents in question, and the information therein, for any purpose extraneous to those proceedings. 106 Mr Hearne's email of 25 July 2005 enclosed a section of the affidavit of Mrs Hesse and the Tonin report. Mrs Hesse's affidavit indicated plainly on its face that it was an affidavit in the Main Proceedings. There are handwritten notes on the copy of Mrs Hesse's affidavit that was sent to the Minister stating that the affidavit was by "one of the plaintiffs". The email noted that the Tonin report commented on the reduction of the mechanical noise of the Ranger ride. The Ranger was one of the rides on which the noise nuisance cause of action in the Main Proceedings was based. The words "Plaintiff's acoustic engineer report" were handwritten on the Tonin report. The answers to interrogatories signed by Mr Hearne stated that Mr Hearne asked the Minister to consider introducing legislation to ensure that the operations of Luna Park would be protected against the complaints that were the subject of the Main Proceedings. 107 These matters establish, beyond reasonable doubt, that Mr Hearne knew that the documents concerned had been produced in the course of the Main Proceedings and that the Main Proceedings were on foot. 108 On 11 August 2005, Mr Tierney transmitted a document described as "briefing notes" to a Ms Talty of the Luna Park Reserve Trust. The briefing notes referred to three scenarios facing LPS "as a result of the current Supreme Court action". The scenarios were the loss of the case, success in the case, and detrimental impact pending the court hearing. A brief analysis of the impact was set out. Reference was made in the briefing notes to the "current court actions" and it was stated: "Retrospectivity is required to prevent the court in the current case awarding damages as a result of any noise impacts the court determines in the last 18 months of trading". Mr Tierney's email of 13 October 2005 forwarded Mr Hearne's email and the attachments to it to the Minister and Mr O'Grady. Mr Tierney must be taken to have known whatever appeared on that email and the attachments. Mr Tierney's email itself referred to "one of the plaintiff's affidavit[s]" and stated that "this can not be quot[ed] as it could be in contempt of court". 109 These matters establish, beyond reasonable doubt, that Mr Tierney knew that the documents concerned had been produced in the course of the Main Proceedings and that the Main Proceedings were on foot. The terms of the implied undertaking 110 It was submitted further, on behalf of Mr Hearne and Mr Tierney, that the appellants had to prove knowledge of the terms of the implied undertaking on the part of Mr Hearne and Mr Tierney and had failed to do so. 111 I do not accept that knowledge of the terms of the implied undertaking are relevant to a charge of contempt based on a breach of the undertaking. By operation of law, the general rule is that the person deemed to have given the undertaking is precluded from using the documents governed thereby for collateral purposes. The general rule is a flexible one, and the court may, by order, modify the undertaking or declare that a party is released from it. But until such an order is made, the undertaking in the terms I have stated applies. The application of the undertaking does not depend on a party's knowledge of its terms; it depends on whether (as I have stated) a party knows that the documents in question were obtained by way of discovery or other compulsory court process. 112 Unless the evidence raises the issue of modification or release, I do not think it incumbent upon the party alleging a breach of the undertaking to prove that the undertaking had not been modified or that there was no release of the undertaking. The general principle common even to special criminal defences (that is, defences other than a denial of the allegations) is that it is for the accused person to produce evidence supporting the special defence sufficient for consideration by members of the jury, whilst it is for the prosecution to disprove that defence once there is sufficient evidence to raise it. In other words, the evidential burden is generally on the accused to raise a special defence for the jury's consideration and the probative burden is on the prosecution to prove the charge beyond reasonable doubt. The only exceptions are the defences of insanity and (insane) automatism where the accused bears both the evidential and the persuasive burden. 113 This general rule is applied, for example, in regard to defences of mistake of fact (He Kaw Teh v The Queen (1985) 157 CLR 523), claim of right (R v Fuge (2001) 123 A Crim R 310), necessity (R v Loughnan [1981] VR 443) and provocation (Stingel v The Queen (1990) 171 CLR 312). There is no reason in principle why the general rule should not apply, in a charge of contempt of court based on the breach of an implied undertaking, to a defence that the implied undertaking has been modified or that the party on whom the obligation was imposed has been released from that obligation. 114 The evidence in the present case did not raise any issue relating to a possible modification or release of the implied undertaking. Proof that the documents were not in "the public domain" 115 Mr Parker submitted on behalf of Mr Hearne and Mr Tierney that the appellants were required to prove that Mrs Hesse's affidavit and the Tonin report had not entered the public domain. He submitted that an essential element of the charge of contempt was that the documents in question had not been "publicly disclosed". The thrust of the submission was that, once the documents became part of the public domain, the implied undertaking was spent. 116 This proposition was based on the observation of Mason CJ in Esso Australia Resources Ltd v Plowman (1995) 183 CLR 10 (at 32 to 33) that: "The implied undertaking is subject to the qualification that once material is adduced in evidence in court proceedings it becomes part of the public domain, unless the court restrains publication of it." See also Ainsworth v Hanrahan where Kirby P (at 168) said: "Once the answers are tendered or read in open court, pace Harman , the liability in contempt for their later use will evaporate." 117 In my opinion, the submission is answered by the rule, previously referred to, that it is for the person charged with contempt for breaching an implied undertaking to raise, by way of adequate evidence, the defence that the undertaking has been discharged by reason of the release into the public domain of the relevant documents. In other words, it was for the appellants to raise, by adequate evidence, that the Hesse affidavit and the Tonin report had been released into the public domain. 118 Mr Parker drew attention to the fact that interlocutory proceedings had taken place and there was no evidence that the material subject to the implied undertaking had not been read in the course of those interlocutory proceedings. 119 By the directions of the Court, Dr Tonin's report was filed for the purposes of the trial (not for any interlocutory proceedings). The same may be said about Mrs Hesse's affidavit. Of course, that does not mean that the report and the affidavit may not have been read in the interlocutory proceedings. But, in the ordinary course, there would be no reason for them so to be read and, in my view, that should be regarded as the prima facie position. That is, in my view, in the absence of evidence to the contrary from Mr Hearne and Mr Tierney, the report and affidavit should be regarded as not having been read (and there was no such evidence). 120 In my view, the evidence does not adequately raise the defence that the Hesse affidavit and the Tonin report were read in interlocutory proceedings and were thereby released into the public domain. Conclusion 121 In my opinion, the appellants have proved beyond reasonable doubt that on 25 July 2005, Mr Hearne, in transmitting by email to the Minister and Mr Schintler extracts from Mrs Hesse's affidavit and Dr Tonin's report, breached the implied undertaking he had given and thereby committed contempt of court. The appellants have also proved beyond reasonable doubt that, on 13 October 2005, Mr Tierney, in transmitting to the Minister and Mr O'Grady the email that Mr Hearne had transmitted on 25 July 2005 together with the attachments to that email, breached the implied undertaking he had given and thereby committed contempt of court. In my opinion, the arguments that Mr Hearne and Mr Tierney have raised in defence of the first charges against them fail. 122 I propose the following orders: (a) The appeal is upheld. (b) Orders of Gzell J set aside and, in lieu thereof, orders adjudging Mr Hearne and Mr Tierney guilty of the contempt in the first charge in the statements of charge. (c) Notices of motion remitted to Gzell J for hearing as to penalty, and to determine the appropriate orders for the costs of the first hearing. (d) Mr Hearne and Mr Tierney to pay the costs of the appeal. (e) Mr Hearne and Mr Tierney to have certificates under the Suitors' Fund Act 1951 (NSW) for the costs of the appeal. 123 BASTEN JA: I agree with the orders proposed by Ipp JA. Subject to what follows, involving matters largely of emphasis, I also agree with his Honour's reasons. Competency of appeal 124 The first issue concerns the competency of the appeal under s 101(5) and (6) of the Supreme Court Act 1970 (NSW). Those provisions confer a right of appeal from a judgment or order of the Court in any proceedings that relate to certain kinds of conduct. The distinction drawn is not between particular kinds of order or between proceedings having particular purposes, objects or characteristics. The distinction to be drawn depends on whether the proceedings relate to a contempt described as civil or as criminal. Where a charge is upheld, the distinction does not matter: where the charge is dismissed, an appeal will lie if the proceedings did not relate to "criminal contempt". In accordance with this language, the inquiry should, at least in the first instance, be directed to the conduct the subject of the charge. 125 That approach is consistent with the joint judgment in Witham v Holloway (1995) 183 CLR 525 at 530 (Brennan, Deane, Toohey and Gaudron JJ) where their Honours stated: "In general terms, the distinction between civil and criminal contempt is that a civil contempt involves disobedience to a court order or breach of an undertaking in civil proceedings, whereas a criminal contempt is committed either when there is a contempt in the face of the court or there is an interference with the course of justice." 126 Their Honours then noted two exceptions to the general rule: one was disobedience or breach of an undertaking which involved "deliberate defiance" or conduct which might be described as "contumacious". The second exception involved specific kinds of order namely those forbidding interference with a ward of court or for the delivery up of a child, or non-molestation order. There may be a third class of exceptions involving breach of a court order by a solicitor or a liquidator, those persons being officers of the court. 127 On this approach, the contempt might properly be classified by reference to the matters asserted in the charge. If the charge asserts breach of a court order in civil proceedings, or breach of an undertaking, and there is no allegation of deliberate defiance, nor particularisation of conduct which would bear the epithet contumacious, and the identified exceptions are not satisfied, the conduct should be characterised as involving a civil contempt. That approach is also consistent with the reasoning of McHugh J in Witham at pp 538-539. 128 The distinctions thus identified may be hard to justify in rational terms, but that would be a matter for the Parliament rather than the courts to rectify, if that were thought desirable. Similarly, difficulties will arise if the proceedings themselves are sought to be classified as involving either proceedings brought in the interest of a party, or in the public interest; or for relief which is "coercive or remedial", rather than relief which is punitive. That is because obedience to a court order will always be in the public interest, as well as in the interest of an individual who obtains the order in civil proceedings, and proceedings for enforcement of a court order will often have a punitive element as well as one which could be classified as remedial. As was noted in Witham (at p 532) there may be cases in which a remedial order cannot be made simply because it is beyond the ability of the party in breach to rectify the breach. However, that circumstance, which could arise at any stage before, during or after the completion of proceedings, may result in no order being made or perhaps in declaratory relief only being granted, by analogy with Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 at 581-582. In itself, that consideration would not appear to affect the classification of the contempt. 129 In the Federal Court, an appeal lies in relation to orders made in civil proceedings, pursuant to s 24 of the Federal Court of Australia Act 1976 (Cth), but not, in accordance with general law principles, "from an acquittal in criminal proceedings": see Australian Building Construction Employees' and Builders Labourers' Federation v David Syme & Co. Ltd (1982) 59 FLR 48, 50-51; 40 ALR 518 at 520 (Bowen CJ, Evatt and Deane JJ) and Microsoft Corporation v Marks (No. 1) (1996) 69 FCR 117 at 136 (Beaumont J, Lehane J agreeing) and at 142 (Lindgren J). A similar distinction applied, in the absence of statutory provision for appeal in the UK, which gave rise to the discussion in the judgment of Lindley LJ in O'Shea v O'Shea and Parnell [1890] 15 PD 59, discussed by Beaumont J in Microsoft at pp 135-136. It was in the course of classifying the "proceeding" that Lindley LJ noted that one should not be "misled by the words 'contempt' and 'attachment', but we must look at the substance of the thing" at p 64. Similarly, Lopes LJ (at p 65) referred to the need to look to "[t]he object of the application". Based on those comments, Beaumont J stated in Microsoft at p 136: "In my opinion, the 'substance' or 'object' test is appropriate in our context also. That is to say, if, in substance, the proceedings at first instance were criminal in the sense that their object were to punish then, as BLF decided, no appeal could lie. On the other hand, if the substance and object of the proceedings were remedial, then an appeal was competent as in any case of an alleged civil contempt." 130 The approach adopted in Microsoft addressed a general law principle; in construing sub-s 101(5) and (6) of the Supreme Court Act, the adoption of these somewhat imprecise concepts, in place of the statutory language, provides limited assistance. Rather, when the test accepted in Witham v Holloway and set out above at [42] is applied, I would accept that, as explained by Ipp JA, the contempt in question is a civil contempt and accordingly the appeal is competent. Status of Respondents 131 The second matter is the question whether the implied undertaking extended to the Respondents. The question is dealt with by Ipp JA at [88]-[103] above. It is, in substance, whether those in control of the corporate litigant, for the purposes of the litigation, are themselves bound by the implied undertaking, or whether their liability for any breach of the implied undertaking given by the company is purely accessorial. 132 The so-called "rules of attribution" recently discussed by McColl JA in North Sydney Council v Roman [2007] NSWCA 27, (2007) 150 LGERA 419 at [28]-[39] are generally applied in determining whether a corporation is liable for the acts of its officers or agents, or is deemed to have the knowledge of an officer or agent. In the context of conduct constituting a contempt of court, those principles were discussed in Director General of Fair Trading v Pioneer Concrete (UK) Ltd [1995] 1 AC 456. In holding a corporation liable for breach of injunctions prohibiting agreements in restraint of trade, which were nevertheless entered into by employees of the corporation despite an express prohibition by senior management, the House of Lords followed the approach of Warrington J in Stancomb v Trowbridge Urban District Council [1910] 2 Ch 190. In that case, the defendants were restrained from sending sewage into a stream and undertook to cleanse the stream. In holding the Council liable for breach of the order, Warrington J stated, at p 194: "In my opinion, further, the act need not be done by the person himself. In the case of a corporation it cannot be done by the corporation itself, at any rate in the case of such a corporation as an urban district council. Such a body can only act by its agents or servants … ." 133 This is not a case of attributing conduct to the corporate litigant: it had acknowledged its responsibility. However, a corporation can only conduct litigation through its representatives or agents. If an undertaking is required, that must be given by an authorised representative of the corporation. Where there is alleged to be a breach by the corporation, an individual must be identified as the actor and as a relevant source of knowledge, for the purpose of considering, in relation to contempt, whether the breach was wilful, or merely casual or accidental. Similarly, if the breach is alleged to be contumacious, that must be because of something done by an individual. 134 Many tradespeople and professionals deliver services through a corporate structure. A corporation may have one officer and no other employees. Where the officer is both the guiding will of the company and the person through whom the company acts, he or she should be seen as bound by the company's implied undertaking as much as the company, although the officer is not a party to the litigation. 135 This view may be thought to be inconsistent with the authority of Marengo v Daily Sketch and Sunday Graphic Ltd [1948] 1 All ER 406 at 407 (Lord Uthwatt) referred to by Handley AJA at [193] below. However, there may be a distinction between those who are bound by an injunction and those to whom the obligation imposed in respect of discovery and disclosure for the purposes of litigation applies. The officer of the corporate litigant who controls the corporation and is responsible for the conduct of the litigation is not aptly described as "a complete stranger" to the litigation, so as not to bound by an implied undertaking of which he or she is well aware and, if the implication were the fact, would have personally conveyed to the court. 136 The fact that the implied undertaking has such an operation may be inferred from the cases to which Ipp JA has referred involving solicitors and an industrial advocate. No doubt the solicitor is liable to owe such an obligation because of his or her status as an officer of the court, although that could not so readily be said of the industrial advocate. However, the role as officer of the court may be seen as filling a gap in the direct relationship which would exist between an officer of the corporation and the corporation itself. 137 If this understanding of the scope of the implied undertaking is in error, I otherwise agree with the reasoning of Ipp JA. Parliamentary privilege 138 Handley AJA also raises a question as to whether these proceedings involve a contempt of the Parliament: at [208] below. The question is whether any communication with officers of a State Government and a State Minister enjoyed the protection of Parliamentary privilege. I would not refuse relief for this reason. 139 The question raises issues going to the constitutional relationship between the Parliament and the courts. These are matters of large import. They invite attention to the doctrine of separation of powers. It is well-established that, under the State Constitution, the doctrine imposes no limit on the legislative power of the State Parliament: see, eg, Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 90-94 (Toohey J). However, the doctrine may well have relevance in other respects. Under general law principles, it may be the justification for restraint on judicial review of administrative action: see Attorney-General (NSW) v Quin (1990) 170 CLR 1 at 35-36 (Brennan J). It may also cast doubt on the hypothesis that Parliamentary privilege excuses breach of obligations designed to maintain the independence and integrity of the judicial institutions of the State and the exercise of judicial functions. 140 The suggestion that Parliamentary privilege might override the obligation not to use material obtained in the course of court proceedings for an extraneous purpose raises the possibility of a similar consequence in relation to other protections and immunities, sometimes called privileges, but which are in truth designed to promote the public interest as much as the interests of individuals. Such protections and immunities are presently seen as fundamental to the proper operation of the courts. To cast doubt on their operation might also raise a question as to the implications arising from the position of the Supreme Court as a potential repository of judicial power, under Chapter III of the Constitution: see, eg, Fardon v Attorney-General (Qld) (2004) 223 CLR 575 at [15] (Gleeson CJ). 141 None of these issues was raised on this appeal and the Court should not, in my view, stray into speculation in this area of constitutional principle. Conclusion 142 For these reasons, as well as those given by Ipp JA, I agree with the orders proposed by Ipp JA. 143 HANDLEY AJA: In this matter I have the misfortune to differ from my bretheren on the competency of the appeal and the existence of undertakings to the Court impliedly given by the respondents about the use of documents produced by the plaintiffs to the solicitors for Luna Park Sydney Pty Ltd (the Company) in the course of the principal proceedings. 144 The facts and the history of the proceedings are set out in the judgment of Ipp JA and will not be repeated in this judgment unless this is necessary. 145 "The differences upon which the distinction between civil and criminal contempt is based are, in significant respects, illusory". So said Brennan, Deane, Toohey & Gaudron JJ in their joint judgment in Witham v Holloway (1995) 183 CLR 525, 534 (Witham). However intermediate appellate Courts must continue to make this distinction when determining whether an appeal lies from the dismissal of proceedings for contempt of Court. It is enshrined in s.101(5) and (6) of the Supreme Court Act which only permit an appeal to this Court from a dismissal in cases of civil contempt. However as the majority said in Australasian Meat Industry Employees' Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98, 108 (Mudginberri): "… very great difficulty has been experienced in maintaining the distinction between civil and criminal contempts and, in particular, in elaborating a precise and certain criterion which divides one class of contempt from the other." 146 The characterisation must begin with the distinction between contempts arising from disobedience to an order or an undertaking to the Court by a party bound (herein order) and other contempts which obstruct or interfere with the course of justice: Witham (at 530). The former can be provisionally characterised as civil contempts while the latter are always criminal. 147 The distinction has its difficulties because a person who is not bound but knowingly assists the party bound to commit a breach or who independently causes the order to be thwarted (A-G v Times Newspapers Ltd [1992] 1 AC 191, 206, 214, 217-8, 229-30) is guilty of a criminal contempt: ibid at 203, 207, 209, 211, 214, 218, 227; Mudginberri at 108. 148 Such acts are criminal contempts because they interfere with and obstruct the course of justice: Mudginberri at 106, Witham at 530, A-G v Times Newspapers Ltd at 203, 209, 220, 221, 227. 149 The power of the Court to deal with third parties whose acts cause a breach of an injunction, although they are not personally bound by it, was confirmed in Seaward v Paterson [1897] 1 Ch 545 CA. An injunction had been granted to a landlord which restrained the tenant Paterson from committing breaches of his covenant not to cause a nuisance. The nuisance complained of was caused by boxing matches on the premises. Further boxing matches were held and the landlord applied to have the tenant, one of his employees, and a third party committed for contempt. North J. committed all three to prison and the third party appealed. Lindley LJ said at 554-6: "… let us consider what jurisdiction the Court has to make an order against [the appellant]. There is no injunction against him – he is no more bound by the injunction granted against Paterson than any other member of the public. He is bound, like other members of the public, not to interfere with, and not to obstruct the course of justice … A motion to commit a man for breach of an injunction, which is technically wrong unless he is bound by the injunction, is one thing; and a motion to commit a man for contempt of Court, not because he is bound by the injunction by being a party to the cause, but because he is conducting himself so as to obstruct the course of justice, is another and a totally different thing ... In the one case, the party who is bound by the injunction is proceeded against for the purpose of enforcing the order of the Court for the benefit of the person who got it. In the other case the Court will not allow its process to be set at naught and treated with contempt." 150 In some cases disobedience to an order by the party bound is arbitrarily characterised as a criminal contempt even if it is not contumacious: Mudginberri (at 107); Witham (at 530). These cases include wrongful interference with a ward of Court, disobedience to orders forbidding molestation or for delivery up of a child, and contempts by officers of the Court and others in a special relationship with it such as solicitors and liquidators. 151 A party is guilty of contempt if his breach of the order was not casual, accidental, or inadvertent: Mudginberri (at 107). If his disobedience is contumacious or accompanied by deliberate defiance of the Court or its authority the contempt is no longer purely civil: Witham (at 530). As the majority said in Mudginberri (at 110): "…where there has been wilful disobedience to an order of the court and a measure of contumacy … civil contempt has a dual character, namely, (a) as between the parties to the proceedings, the element of civil execution and (b) as between the party in default and the State, a penal or disciplinary jurisdiction to be exercised by the court in the public interest. In such a case, at least, 'civil contempt bears much the same character as criminal contempt'." 152 Mudginberri and Witham emphasised the criminal aspects of contempt by disobedience to an order. A fine is a form of punishment: Witham (at 534), but Mudginberri established that fines could be imposed for continuing wilful disobedience to enforce compliance (at 115). This reflected the majority's view (at 109): "There is … much to be said for the view that all contempts should be punished as if they are quasi-criminal in character." 153 The majority also said (at 108): "The concept that disobedience to an order becomes criminal when the primary purpose of exercising the power changes from vindication of the rights of the plaintiff to vindication of the authority of the court is both complex and artificial. Salmon LJ was right when he said in Jennison v Baker [1972] 2 QB at 64, speaking with reference to the enforcement of an injunction generally, that 'the two objects are, in my view, inextricably intermixed'." 154 The point was developed in Witham (above at 532-4): "The distinction between proceedings in the public interest and those that are coercive or remedial in the interest of the private individual is not, in our view, a satisfactory basis for the distinction usually made between civil and criminal contempt … the distinction does not support the general proposition that breach of an order in civil proceedings is a civil contempt … At best, the distinction … supports a separate category of civil contempt to the extent that it clearly appears that the proceedings are remedial or coercive in nature … However, in our view, there are fundamental problems even with that approach. One problem is that there is not a true dichotomy between proceedings in the public interest and proceedings in the interest of the individual ... there is considerable difficulty with the notion that, in some cases, the purpose or object of the proceedings is punitive and, in others, the purpose or object is remedial or coercive … It is necessary to acknowledge, as it was in Mudginberri , that punitive and remedial objects are, in the words of Salmon LJ 'inextricably intermixed'" (emphasis supplied). 155 In Witham the majority (at 534), with the concurrence of McHugh J, held that the criminal onus applied in all contempt cases. There is no separate category of civil contempts where the civil onus applies. 156 Although the separate category of civil contempt noted in Witham (at 532) "where it clearly appears that the proceedings are remedial or coercive" in the interest of a private individual does not attract the civil onus it nevertheless offers a principled and workable distinction between civil and criminal contempt for present purposes. As the majority said in that case (at 532), breach of an order is not always a civil contempt. 157 In my judgment the distinction determines whether an appeal lies to this Court from the dismissal of proceedings for contempt. 158 That test is supported by persuasive dicta in this Court. In John Fairfax Publications Pty Ltd v A-G (NSW) [2000] NSWCA 198 (2000) 181 ALR 694 Spigelman CJ said (para 5) that s.101A(11) of the Supreme Court Act "applies only to contempt proceedings for what would, traditionally, have been regarded as a criminal contempt, namely proceedings which are not remedial or coercive in the interest of a private individual." 159 Recently in Markisic v Commonwealth of Australia [2007] NSWCA 92 Campbell JA said, with the concurrence of myself and Bell J: "[57]. I incline to the view that the present proceedings are a criminal charge of contempt, because they are not remedial or coercive in the interests of a private individual. They seem to relate to alleged past breaches, and the punishment that is sought to be imposed seems to be simply for the purpose of punishing those breaches, rather than as a means of inducing the Commissioner to comply with the terms of the subpoena in a way that he had not previously done. 160 These dicta are consistent with the decision in Microsoft Corporation v Marks (No. 1) (1996) 69 FCR 117 where the Full Federal Court upheld the competency of an appeal. Beaumont J, who delivered the principal judgment, quoted (at 127) earlier dicta in that Court that "civil contempt primarily exists to make the administration of justice effective for the individual litigant". 161 He referred (at 135-6) to English cases which held that the contempt is criminal if, as a matter of substance, "the object of the application was to obtain the punishment of the [contemnor]". Beaumont J concluded (at 136): "… the 'substance' or 'object' test is appropriate in our context also. That is to say, if, in substance, the proceedings at first instance were criminal in the sense that their object was to punish then … no appeal could lie. On the other hand, if the substance and object of the proceedings were remedial, an appeal was competent." 162 The test is applied when the contempt proceedings are instituted (at 137). 163 Microsoft owned the copyright in certain computer programs and had obtained injunctions which restrained Marks from reproducing them and selling unauthorised copies. Its proceedings for contempt for alleged breaches of both orders were dismissed. Beaumont J. concluded (at 137): "In characterising the proceedings, it is material … to take into account … that the moving party was trading, and may be expected to continue to trade. This is consistent with Microsoft's substantial object…being viewed as remedial rather than punitive in character. This also underlines the significance of the proceedings to … Microsoft (ie a civil contempt) as distinct from the more general interest of the public in the due administration of justice (ie a criminal contempt)". 164 That was a clear case. Microsoft obtained the injunctions to protect its business and copyrights, and had a continuing interest in those orders being obeyed. The contempt proceedings were not simply for the punishment of past breaches but were calculated to deter and prevent future breaches which would injure its business. 165 In O'Shea v O'Shea (1890) 15 PD 59 CA, 62 Cotton LJ said that proceedings for civil contempt were "really only a procedure to get something done in the action" and the proceedings before the Court were for criminal contempt because their purpose (at 63) was "not to obtain the doing of anything for the petitioner's benefit." In Seaward v Paterson [1897] 1 Ch 545 CA, 555-6 Lindley LJ distinguished proceedings brought "for the purpose of enforcing the order … for the benefit of the person who got it". In Phonographic Performance Ltd v Amusement Caterers (Peckham) Ltd [1964] Ch 195, 199 Cross J, in a passage adopted by the majority in Mudginberri (at 110), described proceedings for civil contempt as a form of civil execution. 166 In my judgment the correct test for determining the competency of this appeal is that favoured by Spigelman CJ, Campbell JA, and the Federal Court. Proceedings for contempt for breach of an order, outside the established exceptions, are civil if they are remedial or coercive in the interest of a litigant but otherwise they are criminal. Such proceedings need not be in the interests of a "private individual", because they may be brought by a corporation or a government in its capacity as a litigant. 167 The application of this test leads to the conclusion that these proceedings, when commenced in March 2006, were for criminal contempt. The breaches relied on occurred in June and September 2005 and involved the disclosure of witness statements and an expert report to a Minister of the State Government and her official staff. The disclosures were made to persuade the Government to legislate to protect the company against the principal proceedings and to help the Minister promote that legislation in the Parliament. Their efforts were successful and the Luna Park Site Amendment (Noise Control) Act (the Act) was assented to on 15 October 2005. 168 The respondents were aware of the implied undertakings but did not give evidence. The appellants did not seek injunctions against further breaches by the Company or against further disclosures by the respondents. There is power to grant such injunctions: Arlidge, Eady & Smith on Contempt 2nd ed 1999 pp 876-7; Borrie & Lowe Law of Contempt 3rd ed 1996 p639; Australian Consolidated Press Ltd v Morgan (1965) 112 CLR 483, 503. 169 The past breaches by the respondents, if such they were, could not be remedied. This was also the situation in Witham where the majority said (at 532): "… there are some circumstances in which the breach simply cannot be remedied. That can be illustrated by reference to the orders in this case. The order that the appellant not deal with his assets in a way that reduced their value below $200,000 could not be remedied once his assets were reduced in such a way that he was in no position to raise that, or any lesser sum of money, to satisfy the judgment debt. And when the contempt proceedings were commenced, ie after judgment had been entered and the appellant's total inability to satisfy the judgment ascertained, the purpose of the disclosure order could no longer be achieved." 170 The principal proceedings were continuing on other issues. Mr Alexis SC for the appellants submitted that the contempt proceedings were coercive because they would secure for the appellants the full benefit of the undertakings in future. This appeared plausible until Mr Parker SC for the respondents referred us to correspondence between the solicitors shortly before the contempt proceedings were commenced. 171 On 2 March 2006 the solicitors for the appellants wrote to the solicitors for the company complaining of breaches of the undertaking in June and September the previous year when documents were given to the Minister and her official staff. On 9 March the solicitors for the company apologising on its behalf for the breaches saying they would bring the matter to the attention of Brereton J, who was case managing the principal proceedings, and offer a public apology. This occurred on 20 March. The contempt proceedings were commenced on 15 March but the company which had admitted breaches of the undertaking was not joined. 172 There had been an earlier breach by the company when affidavits that had not been read in Court were given to the media. The company's solicitors wrote on 20 April 2005, to apologise and gave an express undertaking not to give unread affidavits to the media or any other person who was not connected to the proceedings. 173 Following the passing of the Act the respondents had no need to make further disclosures to the Minister or her staff, and there was no evidence of anything that might tempt them to do this again. 174 The clear impression those letters convey to me is that the purpose of the foreshadowed contempt proceedings was to punish the respondents. 175 An order against a company extends to the acts and omissions of its servants and agents acting in that capacity. If the disclosures by the respondents were breaches of its undertakings the company was guilty of contempt of court and coercive and injunctive relief could have been sought against it. 176 This is established by Heatons Transport (St Helens) Ltd v The Transport and General Workers Union [1973] AC 15 where a trade union was held liable in contempt for action by its shop stewards which had not been authorised by its General Executive Council. Lord Wilberforce speaking for the Appellate Committee, said (pp98-100): "The union's contention is that the only remedy is against the shop stewards: the appellants seek to make the respondent union responsible. The essential issue is therefore one of authority; the authority of the shop stewards to take the action complained of on behalf of the union … in each case the test to be applied is the same: was the servant or agent acting on behalf of, and within the scope of the authority conferred by, the master or principal? … there are cases in which an agent who is not a servant does have authority of considerable generality. He may be elected or appointed to some office or post for a substantial period … and he may have to exercise a discretion in dealing with a series of situations as they arise. The position of such an agent and the scope of his authority are very similar to those of a servant." 177 In view of the earlier breaches in 2005 and the admissions and apologies in the letters from the company's solicitors of 20 April 2005 and 9 March 2006, any further breaches for which the company was responsible in all probability would attract severe punishment. This was likely to cause financial loss to the company and its owners apart from the risks the respondents would face personally under the principles in Seaward v Paterson. These were powerful deterrents against any further breaches of the undertakings. 178 If the real purpose of the appellants had been to secure the full benefit of the undertaking in the future this could have been achieved at minimum cost by contempt proceedings against the company combined with an application for injunctions against the respondents. I have not been persuaded that the contempt proceedings against the respondents when commenced were "remedial or coercive in nature". In my opinion the proceedings were for criminal contempt and the appeal should be dismissed as incompetent. 179 The respondents did not object to the competency of the appeal although a holding Summons for leave to appeal was filed on 19 July 2006 and a notice of appeal with appointment on 24 October. Full appeal books have been printed and written submissions filed dealing with the merits as well as the competency of the appeal. As a result the costs have been unnecessarily increased. 180 I would therefore have been disposed to invite written submission on whether SCR Pt.51 r25(2) should be applied. As I am in a minority this question need not be pursued. 181 Since the majority hold that the appeal is competent I must consider other issues. I agree with much that Ipp JA has written on these issues but again regrettably I cannot agree that the implied undertaking was given by the servants and agents of the company other than its solicitors. 182 Ipp JA refers to the decision of the Full Court of the Supreme Court of Western Australian in Hamersley Iron Pty Ltd v Lovell (1998) 19 WAR 316 (Hamersley) where the Court held that Mr Lovell, an industrial advocate acting for the Union, was bound by the same implied undertaking as the Union. 183 The undertaking to keep discovered documents confidential and only use them for the proper purposes of the litigation which was originally express: Hopkinson v Lord Burghley (1867) LR 2 Ch Ap 447, in due time came to be implied: Alterskye v Scott [1948] 1 ALL ER 469, 470; Riddick v Thames Board Mills [1977] 1 QB 881 CA, 896; Esso Australia Resources Ltd v Plowman (1995) 183 CLR 10, 32. It is sometimes expressed as an obligation to the Court and the other litigant, arising by operation of law, which suggests that it has outgrown the limitations attaching to contempt proceedings for the enforcement of undertakings to the Court. 184 The implied undertaking or obligation extends to the solicitors acting for the litigant and this was treated as settled law in Harman v The Home Office [1983] 1 AC 280 (Harman). Lord Diplock said (at 304) that orders for discovery and inspection were "made upon the implied undertaking given by the solicitor personally to the Court (of which he is an officer)". Lord Keith (at 309) referred to the implied undertaking to the Court given by "a party's legal advisor" and (at 312, 313) Lord Scarman and Lord Simon of Glaisdale said that the law imposed the obligation "by implying an undertaking by the party … and his solicitor". Only Lord Roskill in a dictum referred (at 320) to "the implied undertaking of those in whose favour discovery is made … I, of course, include in that expression the solicitors and other agents of those parties." 185 Ipp JA collects (paras [91]-[102]) authorities said to support the proposition that the implied undertaking of the company was also given by the respondents as its servants or agents. This must mean that the undertaking was imposed on them personally by operation of law when the company, as a litigant party, came under that obligation. The undertaking as Lord Keith said in Harman (above at 308) "is … independent of any obligation … under the general law relating to confidentiality". 186 In my judgment the decision in Distillers Co. (Biochemicals) Ltd v Times Newspapers Ltd [1975] QB 613 (Distillers) where the plaintiff obtained an injunction to restrain a third party, which knew it had received discovered documents, from publishing confidential information in them, was not based on the Court's power to restrain a contempt of court. It was based on the power of a Court of Equity to restrain misuse of confidential information obtained from a person bound by an obligation of confidence to the plaintiff (at 619-620). 187 In my respectful opinion the cases other than Hamersley referred to by Ipp JA do not support the existence of an implied undertaking which extends beyond the litigant party and his solicitor. In Pacific Basin Exploration Pty Ltd v XLX (NL) (1984) 2 IPR 489 the Managing Director was found to have been in contempt of court. He had been present when the undertaking was given and his actions caused the Company to breach its undertaking. He was personally liable for contempt of court on the principles applied in Seaward v Paterson. 188 In Watkins v AJ Wright (Electrical) Ltd [1996] 3 ALL ER 31, 43 Blackburne J applied Lord Roskill's dictum in Harman and held that the implied undertaking was not confined to the solicitor on the record but extended to solicitors, such as the Scottish solicitor in that case, who "take upon themselves the day to day conduct of the litigation." 189 In my opinion the passage quoted from the judgment of Staughton LJ in Mahon v Rahn (No 1) [1998] QB 424, 454 does not support an extension of the implied undertaking to the respondents. His reference to the liability of a person who knowingly aids a contempt or does acts which are inconsistent with the undertaking is to the principles in Seaward v Paterson. His reference to Distillers was inappropriate because Talbot J. did not find that the Times was guilty of contempt of court, or impose sanctions. Talbot J did not rely on the principles in Seaward v Paterson which was not mentioned. The statement of Staughton LJ dealing with the position in civil proceedings was dicta, as the case concerned the effect of compulsory disclosure in criminal proceedings, and on this question it was overruled in Taylor v Serious Fraud Office [1999] 2 AC 177. 190 The passage quoted from the judgment of Laddie J. in Bourns Inc. v Raychem Corpn [1999] 1 All ER 908, 915-6 is also not relevant. He. said that it would be a contempt of court for a shorthand writer or court usher to disclose discovered documents to a stranger. So it would, but on the principles in Seaward v Paterson, not because those officers would be bound personally by the undertakings given by the litigants. As officers of the Court they would also be liable in contempt if their breaches of duty interfered with the course of justice: Borrie & Lowe op cit p450; Mudginberri at 107-8. 191 The statement by Ryan J. in Spalla v St George Motor Finance Ltd (2004) 209 ALR 703, 717 that the implied "undertaking must bind the litigant … and his or her privies" is a dictum which wasn't necessary for his decision. The liquidator of the Company formerly controlled by the accused was not their privy so as to be bound by their implied undertakings in the criminal proceedings. He did not claim through or under them for the purposes of the liquidation. However he would be bound by an obligation of confidence attaching to documents he obtained from the accused which he knew had been produced by the prosecution. He was amenable to equitable restraint as in Distillers, and liable in contempt if he caused the undertakings of the accused to be thwarted. 192 The decision in Hamersley that Lovell, the industrial advocate, was personally bound by an implied undertaking may be a justifiable extension of the implied undertaking which binds the solicitor on the record, and his liability may be supported on the principles in Seaward v Paterson but in my judgment the case does not justify a further extension of the undertaking to other servants and agents of a litigant. 193 An injunction which restrains the defendant by himself, his servants and agents from committing the prohibited acts is not an order against those servants and agents. Its operation was explained by Lord Uthwatt in Marengo v Daily Sketch and Sunday Graphic Ltd [1948] 1 All E.R. 406, 407: "The reference to servants … and agents … has not the further result that those persons are enjoined, for, as Lord Eldon LC pointed out in Iveson v Harris (1802) 7 Ves. 251, 256 it was not competent to the Court: 'to hold a man bound by an injunction, who was not a party in the cause for the purpose of the cause' The reference to servants … and agents in the common form is nothing other than a warning against wrongdoing to those persons who may by reason of their situation be thought easily to fall into the error of implicating themselves in a breach of the injunction by the defendant. There its operation, in my opinion, ends. If they knowingly assist the defendant in a breach by him of the injunction, they may be committed for contempt of court, not because they have broken the injunction - they have not done so - but because they have so conducted themselves as to obstruct the course of justice in assisting a breach and tried to set process of the court at naught. In that respect they stand in no different position from a complete stranger who knowingly sets out to assist the defendant in committing a breach." 194 If an injunction which expressly refers to the servants and agents of the defendant does not bind those servants and agents personally I fail to see how an implied undertaking can have a wider operation. 195 The respondent Peter Hearne was the managing director of the company when the proceedings were commenced and at all material times remained a director. Metro on George Pty Ltd held 34 percent of the shares in the company and Mr Hearne was a director of this company and held one of its two issued shares. 196 The respondent David Tierney had no official position with the company but was the Development Manager and strategic advisor to Multiplex Developments Australia Pty Ltd. The second defendant in the principal proceedings was Metro Edgley Pty Ltd which held 50 percent of the shares in the company. The ultimate holding company for Multiplex Developments Australia Pty Ltd and Metro Edgeley Pty Ltd was Multiplex Limited. 197 As Gzell J said, it could be inferred on the criminal onus that Mr Tierney was involved in the day to day operations of Luna Park, and as such a de facto senior executive of the company. 198 Mr Hearne as a director of the company was its servant or agent, as was Mr Tierney and if by operation of law they gave implied undertakings to the Court they were in breach. 199 Since in my judgment the law does not impose an implied personal undertaking on servants and agents of a corporate litigant the first charge of contempt against both respondents, based on an implied personal undertaking given by them to the Court, was not established. A second charge of contempt against both respondents was also dismissed but there has been no appeal from this dismissal. 200 It is not necessary to consider whether any implied personal undertaking to the Court given by the servants and agents of a corporate litigant extends to persons who are only its servants or agents de facto. 201 One or both of the respondents may have been liable for contempt on the principles in Seaward v Paterson but the charges against them were not framed on that basis. 202 Other English cases dealing with the liability of directors and officers for contempts by the company are not relevant. They are based on RSC 1962 Order 45 r.5 which replaced RSC 1883 Order 42 r.31: A-G for Tuvalu -v- Philatelic Distribution Corporation Ltd [1990] 1 WLR 926 CA, 937. Rule 5 provided: "(1) [Where - … (b) a person disobeys a judgment or order requiring him to abstain from doing an act, then, subject to the provisions of these rules, the judgment or order may be enforced by one or more of the following means, that is to say - … (ii) where that person is a body corporate, with the leave of the Court, a writ of sequestration against the property of any director or other officer of the body; (iii) subject to the provisions of the Debtors Acts 1869 and 1878, an order of committal against that person or, where that person is a body corporate, against any such officer." 203 In Biba Ltd v Stratford Investments Ltd [1973] Ch 281, 287 Brightman J held that this rule made directors and other officers liable for breach of an injunction against the corporation although they had not consciously aided or abetted the breach. They had adopted a passive role and would not otherwise have been liable. In A-G for Tuvalu (above at 938) Woolf LJ held that under the English rules a director who had not actively caused the breach could be punished for contempt where there has been "wilful blindness", or a failure to act positively to ensure compliance with the order. 204 There are no similar provisions in SCR Pt 55, cf r13. 205 Had I been persuaded that the appeal was competent and that the respondents had given undertakings to the Court there would still, to my mind, have been a real question as to whether the transmission of documents covered by the undertaking to a Government Minister for parliamentary purposes was a breach of the undertaking. Would a Minister who knowingly used documents covered by the undertaking be guilty of contempt of court? I am inclined to think that proceedings against the Minister for contempt of court would be a contempt of the Parliament. It is even possible that these proceedings are a contempt of the Parliament. 206 The point was not taken but I would not have been prepared to make a finding of contempt based on disclosures to the Minister and her staff without hearing proper argument on the point after notice to the Attorney General. 207 The unsolicited disclosures to the Minister and her staff became connected with proceedings in Parliament when the Minister used them to promote the Act. In this way they may have come to attract Parliamentary privilege: Rivlin v Bilainkin [1953] QB 485, 488. In O'Chee v Rowley (1997) 150 ALR 199, 208-9 McPherson JA, who gave the principal judgment of the Court, referred to s.16(2) of the Parliamentary Privileges Act 1987 (C'wealth) which may reflect the law in this State. He held that "acts done … for purposes of … the transaction of the business" of Parliament attracted the privilege, and this covered unsolicited letters and documents sent to a member of Parliament who kept and used them for the business of Parliament. 208 Unless such uses are protected by Parliamentary privilege or by an exception in the implied undertaking such as that recognised for the use of the material in criminal proceedings: Rank Film Ltd v Video Information Centre [1982] AC 380, 442, 447, the Australian Government solicitor and the State Crown solicitor could not advise their Governments that pending proceedings had demonstrated the need for legislation. I would need to be persuaded that the implied undertaking could have that operation. 209 I would therefore have dismissed the appeal as incompetent, and if competent, would have dismissed it because the respondents were not bound by personal undertakings to the Court. ********** 11/06/2008 - Amending cross-referenced paragraph number - Paragraph(s) 130 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.