Sankey v Whitlam

142 CLR 1
21 ALR 505

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(Judgment by: MASON J)

Between: SANKEY
And: WHITLAM

Court:

Judges: Gibbs ACJ.
Stephen J.

Mason J.Jacobs J.
Aickin J.

Subject References:
Criminal Law
Evidence
Declaration

Judgment date: 9 November 1978

Sydney

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Judgment by:
MASON J

These proceedings, which were removed at the outset of the hearing into this Court by an order made under s 40 of the Judiciary Act 1903 as amended, raise some interesting and difficult issues. Initially there is the quesiton whether declaratory relief of the kind sought should be granted in relation to issues arising in committal proceedings pending before a magistrate in a court of petty sessions. As the proceedings have been removed into this Court, it is this Court's jurisdiction to grant declaratory relief that is engaged. This Court's jurisdiction to grant declaratory relief, delimited as it is by O. 26, r. 19 of the High Court Rules, is no less extensive than the jurisdiction conferred upon the Supreme Court of New South Wales by s. 75 of the Supreme Court Act, 1970. All that was said in Forster v. Jododex Aust. Pty. Ltd. (1972) 127 CLR, at pp 434 et seq as to the extent of the jurisdiction formerly conferred upon the Supreme Court by the legislation which preceded the Supreme Court Act, 1970 has equal application to this Court's jurisdiction to make declarations of right. Having regard to the breadth of our jurisdiction to grant relief of the kind sought, I see no impediment in point of jurisdiction to the grant of declaratory relief in the present case.

However, whether the Court should exercise its discretion to grant declaratory relief in this case gives rise to a more acute problem. In Forster v. Jododex Aust. Pty. Ltd. (1972) 127 CLR, at p 438 , Gibbs J., with whose judgment on this point McTiernan and Stephen JJ. and I agreed, referred to Lord Radcliffe's observation in Ibeneweka v. Egbuna (1964) 1 WLR, at p 225 that "the power to grant a declaration should be exercised with a proper sense of responsibility and a full realisation that judicial pronouncements ought not to be issued unless there are circumstances that call for their making". Except in New South Wales where the grant of declaratory relief is more fashionable than elsewhere (see Bourke v. Hamilton (1977) 1 NSWLR, at pp 476-479 and the cases cited by Needham J. in his judgment), there is a dearth of authority supporting the grant of declaratory relief in relation to committal proceedings. The absence of authority is doubtless to be explained by a variety of circumstances - the recognition that the function of a magistrate in hearing committal proceedings is to decide whether there is a prima facie case against a defendant which warrants his being put upon trial; that a committal for trial is a preliminary examination which involves no final determination of the defendant's guilt of the offence charged; the absence of any appeal from the magistrate's decision; and the existence of the Attorney-General's discretion to commit for trial. All these factors tend to indicate that a plaintiff for declaratory relief in relation to committal proceedings needs to show some special reason why the court should grant the relief sought in lieu of allowing the committal proceedings to pursue their ordinary course. The chequered history of the committal proceedings in this very case is a salutary example of what may occur when proceedings are commenced in a superior court seeking answers to some, but of necessity not all, of the issues arising in committal proceedings. The proceedings before the magistrate are interrupted whilst the superior and appellate courts give attention to particular questions upon which guidance is sought. It may result in unacceptable discontinuity and delay.

In this case the two informations were laid on 20th November 1975. The proceedings before the magistrate were first interrupted when the defendants sought relief in the nature of certiorari, prohibition and declarations in Connor v. Sankey (1976) 2 NSWLR 570 . After this decision was given by the Court of Appeal on 15th October 1976 and the committal proceedings had been resumed, further proceedings were then instituted in the Supreme Court arising out of the magistrate's announcement that he would no longer hear the case on the ground of appearance of bias. The Supreme Court ordered him to continue the hearing. This decision was affirmed by the Court of Appeal and an application for special leave to appeal from that decision to this Court was subsequently withdrawn. It was after a further resumption of the proceedings before the magistrate in which he decided various questions relating to the production of documents that the current proceedings were launched in the Supreme Court. The result has been that the committal proceedings have been fragmented and inordinately delayed. Almost three years have elapsed since the informations were laid, yet the committal proceedings are a long way from completion. Indeed, it seems that the magistrate has not yet received oral evidence.

Confronted with this unsatisfactory and exceptional situation the Court should, I think, grant the declaratory relief if it appears that by so doing it will facilitate the committal proceedings and finally put beyond doubt important and difficult issues of law. The very nature of the offences charged and the character of the defendants demonstrate the high public importance of the proceedings. The questions relating to the production of documents involve a fundamental examination of the scope and extent of Crown privilege and the counterclaim calls for a consideration of s. 105A of the Constitution, the Financial Agreement and s. 86 of the Crimes Act. All these questions, especially those which relate to the Constitution, merit the attention of this Court.

Whether the issues now sought to be determined could be raised for decision in other proceedings in the Supreme Court is not of decisive importance. There has been a long-standing controversy as to the availability of common law prohibition and certiorari to a magistrate hearing committal proceedings. Supreme Courts in New South Wales and Victoria have held that the writs do not lie (Ex parte Cousens; Re Blacket (1947) 47 SR (NSW) 145, at p 147 ; Ex parte Lyndon; Re Cooper (1957) 57 SR (NSW) 626 ; Ex parte Donald; Re McMurray (1969) 89 WN (Pt 1) (NSW) 462, at pp 466, 467 ; Ex parte Coffey; Re Evans, (1971) 1 NSWLR 434, at pp 449, 457, 458 ; Phelan v. Allen (1970) VR 219 ). The Supreme Court of Queensland has taken a different view (Reg. v. Schwarten; Ex parte Wildschut (1965) Qd R 276 ), as has the Supreme Court of Ontario (Reg. v. Botting (1966) 56 DLR (2d) 25 ). In this conflict of authority my preference is for the view that prohibition will lie to a committing magistrate to correct for want or excess of jurisdiction. Although it has been said that committal proceedings are ministerial (Ammann v. Wegener (1972) 129 CLR 415 , at pp 435-436 ), it should now be recognized affirmatively that a magistrate hearing committal proceedings has, within the meaning of Atkin L.J.'s observations in R. v. Electricity Commissioners; Ex parte London Electricity Joint Committee Co. (1920) Ltd. [1924] 1 KB 171 , at p 205 , authority to determine questions affecting the rights of subjects and that he has a duty to act judicially. It is his function to determine whether there is a prima facie case against the defendant sufficient to warrant his being put upon trial. That determination is one which materially affects the defendant because it exposes him to trial upon indictment and to a deprivation of his liberty pending trial. There can be no doubt that in arriving at his decision the magistrate is bound to act judicially in the sense that he must observe certain standards of fairness appropriate to be applied by a judicial officer. It would be quite unacceptable to say that a committing magistrate is not under a duty to act judicially or that he is entirely free from supervision by a superior court, even when acting without jurisdiction or in excess of his jurisdiction.

If the magistrate, when he exceeds his jurisdiction, is subject to supervision by the prerogative writs, then there is little to be said for the view that the court should not intervene by making a declaration of right when the offence charged in the summons and information is one which is not known to the law. The distinction between no jurisdiction and jurisdiction to entertain proceedings for an offence unknown to the law is not sufficiently formidable to warrant intervention in one case but not in the other.

On the other hand, if a committing magistrate is not subject to prohibition, even for absence or excess of jurisdiction, it may be said that this constitutes an additional reason for exercising the discretion to grant declaratory relief if it be otherwise appropriate.

The plaintiff's case for an exercise of the court's discretion to grant declaratory relief is, if anything, even stronger than that presented by the defendants in relation to the first information, that which is based on s. 86 (1) (c) of the Crimes Act 1914 (Cth), as amended. An order by a magistrate compelling or refusing production of documents may be susceptible of appeal under s. 112 of the Justices Act, 1902 (NSW), as amended, or by prerogative writ (see Ex parte Brown; Re Tunstall (1966) 67 SR (NSW) 1 ; Ex parte Attorney-General (NSW); Re Cook (1967) 2 NSWLR 689 ). There is nothing then in the point that the magistrate's rulings on production of documents are not subject to review; indeed, it would be surprising if that were so, particularly in cases involving a claim to Crown privilege. Though in some cases a court may refuse to give declaratory relief when similar relief is available in other proceedings, that is not a reason for refusing declaratory relief when it is otherwise convenient to grant it.

As the production of documents turns to some extent on the issues which arise in connexion with the offences charged in the informations, it is necessary to look in the first instance to the declaratory relief sought by the defendants in relation to the first information. There it is alleged that the defendants "conspired with each other to effect a purpose that was unlawful under a law of the Commonwealth, that is to say to effect the borrowing by the Commonwealth of Australia from overseas sources a sum in the currency of the United States of America not exceeding the equivalent of $4,000 million in contravention of the Financial Agreement, 1927 as amended, the Constitution Alteration (State Debts) Act, 1928 and the Financial Agreement Act, 1944 as amended".

The charge is based on s. 86 (1) (c) of the Crimes Act. The sub-section provides:

"A person who conspires with another person -

...

(c)

to effect a purpose that is unlawful under a law of the Commonwealth; ...

shall be guilty of an indictable offence."

According to particulars given by the plaintiff, the purpose was unlawful in that it was to effect a borrowing by the Commonwealth from overseas sources of up to $4,000 million for purposes other than temporary purposes without reference to and approval by the Australian Loan Council and without the proposed borrowing being included in any loan programme approved by the Council, with the consequence that the proposed borrowing was contrary to the Financial Agreement . All this, it is said, involves contraventions of cll. 3 (8), 3 (15), 4 (4) and 6 of the Financial Agreement, s. 105A (5) of the Constitution, and the Financial Agreement Act 1944.

The Financial Agreement ("the Agreement") was made on 12th December 1927 between the Commonwealth and the States before s. 105A was introduced into the Constitution. The Agreement has been varied from time to time, each variation having been approved by Commonwealth and State statutes. The Agreement recited that the scheme which it embodied was designed to make provision for the adjustment of Commonwealth and State financial relations. It also recited that permanent effect could not be given to the scheme unless the Constitution was altered so as to confer power on the Commonwealth Parliament to make laws for carrying out and giving effect to the proposals and that, pending submission to a referendum of a proposed law, the parties agreed that for the period commencing on 1st July 1927 and ending on 30th June 1929 certain provisions of the scheme should be temporarily adopted.

Clause 1 of the Agreement provides:

"This Agreement shall have no force or effect and shall not be binding on any part unless and until it is approved by the Parliaments of the Commonwealth and of the States."

Clause 3 provides for the establishment of the Australian Loan Council consisting of representatives of the Commonwealth and the States. Its function is to regulate (inter alia) the annual borrowings of the Commonwealth and the States. Clause 3 (8) provides:

"The Commonwealth and each State will from time to time, while Part III. of this Agreement is in force, submit to the Loan Council a programme setting forth the amount it desires to raise by loans during each financial year for purposes other than the conversion, renewal or redemption of existing loans or temporary purposes. Each programme shall state the estimated total amount of such loan expenditure during the year, and the estimated amount of repayments which will be available towards meeting that expenditure. Any revenue deficit to be funded shall be included in such loan programme, and the amount of such deficit shall be set out. Loans for Defence purposes approved by the Parliament of the Commonwealth shall not be included in the Commonwealth's loan programme or be otherwise subject to this Agreement."

Provision is made for the Loan Council's determination of the amount to be borrowed each year, the allocation of the amount between the Commonwealth and the States (cl. 3 (9), (10), (11) and (12)). The Commonwealth and the States are obliged to submit statements of the amounts that they require during each year for the conversion, renewal or redemption of existing loans (cl. 3 (13)).

Clause 3 (15) is in these terms:

"A decision of the Loan Council in respect of a matter which the Loan Council is by this Agreement empowered to decide shall be final and binding on all parties to this Agreement."

Except in cases where the Loan Council has decided that moneys shall be borrowed by a State, the Commonwealth shall, while Pt III of the Agreement is in force, subject to certain provisions in the Agreement, arrange for all borrowings for or on behalf of the Commonwealth or any State (cl. 4 (1)). Provision is made for borrowing outside Australia by a State if the Loan Council so decides and moneys so borrowed are deemed to be moneys borrowed by the Commonwealth for and on behalf of the State (cl. 4 (2)).

Clause 4 (4) is critical. It provides:

"While Pt III. of this Agreement is in force, moneys shall not be borrowed by the Commonwealth or any State otherwise than in accordance with this Agreement."

Clause 6 (3) provides:

"Where any such borrowing or use is solely for temporary purposes, the provisions of this Agreement, other than this clause, shall not apply."

Part III of the Agreement is still in operation. It contains cl. 8 which is in these terms:

"This Part of this Agreement shall not come into force or be binding upon any party hereto unless before the 1st July, 1929, the Constitution of the Commonwealth has been altered in accordance with the proposals referred to in Pt IV. of this Agreement and a law of the Parliament of the Commonwealth has been made thereunder validating this Agreement, but shall come into full force and effect if and when before the said date the Constitution is so altered and this Agreement is so validated."

Clause 15 provides for the submission to the Parliament and the electors of a constitutional alteration in the form subsequently expressed by s. 105A of the Constitution. Action taken in accordance with the clause resulted in approval by a referendum of the proposed alteration to the Constitution and the insertion by the Constitution Alteration (State Debts) 1928 of s. 105A.

The critical provision upon which the first information is based is cl. 4 (4) which prohibits the borrowing of moneys by the Commonwealth or any State otherwise than in accordance with the Agreement. In essence the case made against the defendants in the committal proceedings on this information is that they conspired to effect a borrowing by the Commonwealth in breach of this prohibition, the motive being to avoid the inclusion of the borrowing in the Commonwealth programme required to be submitted to the Loan Council, and that such a borrowing, if made, is unlawful under a law of the Commonwealth. I turn now to the statutory provisions, including s. 105A, which relate to the Agreement and which are said to give the prohibition in cl. 4 (4) the character and status of a law of the Commonwealth.

The original Agreement was approved by the Financial Agreement Act 1928. The Agreement as varied has been approved by the Financial Agreement Act 1928-1966. As the original Agreement was intended to have an operation before s. 105A was introduced into the Constitution it required validation. Section 105A did not itself validate the Agreement, but by sub-s. (2) it gave the necessary authority to the Parliament to enact such a validation. The Commonwealth Parliament exercised that authority by the Financial Agreement Validation Act 1929 .

Section 105A (1) of the Constitution authorizes the Commonwealth to make agreements with the States with respect to the public debts of the States. The section then goes on to provide:

"(2) The Parliament may make laws for validating any such agreement made before the commencement of this section.

(3) The Parliament may make laws for the carrying out by the parties thereto of any such agreement.

(4) Any such agreement may be varied or rescinded by the parties thereto.

(5) Every such agreement and any such variation thereof shall be binding upon the Commonwealth and the States parties thereto notwithstanding anything contained in this Constitution or the Constitution of the several States or in any law of the Parliament of the Commonwealth or of any State."

The contention is that s. 105A (5) gives the force of law to the provisions of the Agreement, in particular to the prohibition which is contained in cl. 4 (4), with the consequence, so the argument runs, that a borrowing contrary to the prohibition contained in that sub-clause is a borrowing contrary to a law of the Commonwealth, the relevant law being that expressed in cl. 4 (4) by virtue of the provisions of s. 105A (5).

It has been pointed out in this Court on more than one occasion that the Financial Agreement is given paramountcy by s. 105A and that it overrides Commonwealth and State laws, even the Constitution itself (New South Wales v. The Commonwealth (No. 1) (1932) 46 CLR 155 , at pp 172, 177, 186, 202 ; Melbourne Corporation v. The Commonwealth (1947) 74 CLR 31 , at pp 62, 95, 101 ; Bank of New South Wales v. The Commonwealth (1948) 76 CLR 1 , at pp 244-246, 279-283, 326, 338-339 ). The plaintiff relies particularly on the remark of Starke J. in New South Wales v. The Commonwealth (1932) 46 CLR, at p 186 that the Agreement, "is part of the organic law of the Commonwealth. It can only be varied or rescinded by the parties thereto. Nothing in the Constitution or in the Constitutions of the States can effect it or prevent its operation. It creates rights and duties as between the Commonwealth and the States upon and in respect of which the judicial power of the Commonwealth can be exerted." In Bank of New South Wales v. The Commonwealth (1948) 76 CLR, at pp 279-280 , Rich and Williams JJ. referred to Starke J.'s observations, evidently with approval.

Of Starke J.'s statement and other statements to the same effect the comment must be made that they were not directed to the issue with which the Court is now concerned. It is one thing to say that the effect of s. 105A (5) is to make the Agreement binding on the parties and to deny an operation to Commonwealth and State laws which would render the Agreement invalid or ineffective. It is quite another thing to say that the provisions of the Agreement have the force of law in the sense that they are laws. To say, even in a statute, that an agreement is binding on the parties, is to do no more than give the agreement validity and efficacy as a contract, more especially when in the absence of statute the contract would have been invalid.

The distinction between a statutory provision which merely gives validity to a contract and makes its provisions binding on the parties, thereby overcoming some obstacle to its validity or operation, and one which goes further by imposing a statutory obligation on the parties to carry out the terms of the contract, thus giving them the force of law, is well brought out in the judgment of Lord Cairns L.C. in Caledonian Railway Co. v. Greenock and Wemyss Bay Railway Co. (1874) LR 2 Sc & Div 347, at p 349 . In that case the statute not only "sanctioned and confirmed" the antecedent agreement, it also required the parties to carry out the provisions of the agreement. Of the first provision Lord Cairns said: ". . . the enactment does no more than give statutory validity to the agreement."Of the second provision his Lordship went on to say:

". . . when an agreement between two companies who are coming for an Act of Parliament is scheduled to the Act of Parliament, and when an enactment is found in the body of the Act that each company shall be required to implement and fulfil all the provisions and stipulations in the agreement, every provision and stipulation in that agreement becomes as obligatory and binding on the two companies as if those provisions had been repeated in the form of statutory sections."

The distinction so made between a statutory provision giving validity to an agreement and one which goes further so as to impose a statutory obligation to carry out the provisions of the agreement has been accepted and acted upon in later cases (Reg. v. Midland Railway Co. (1887) 19 QBD 540, at pp 544, 546, 548, 549-550 ; Manchester Ship Canal Co. v. Manchester Racecourse Co. (1900) 2 Ch 352; affd (1901) 2 Ch 37 ; Pyx Granite Co. Ltd. v. Ministry of Housing and Local Government [1960] AC 260 ).

Section 105A does not impose any separate statutory obligation on the Commonwealth and the States to carry out the provisions of the Agreement. It makes the Agreement binding on the parties, but that is to give its provisions the binding force which they have as contractual provisions. Section 105A (3), by empowering the Parliament to make laws for the carrying out by the parties of the Agreement, suggests that the imposition of a statutory obligation to perform the Agreement was a matter left for Parliament to determine.

The plaintiff relies strongly on the last clause in s. 105A (5). But to say that the contract is binding, notwithstanding anything contained in constitutions or laws, is to preserve its validity and operation immune from the impact that those constitutions and laws might otherwise have on the contract. The unique status thereby given to the Agreement is the product of s. 105A (5) which is itself the relevant fundamental law. It is not a status which the Agreement acquires because it is a fundamental law or even a law. It remains a contract, though one with very special qualities. It is not converted from a contract into a law with each of its clauses having the character of a statutory provision. Like every contract it continues to be capable of variation or rescission by the parties, a circumstance for which s. 105A (4) makes provision. It may be that a statute could provide for the alteration of the content of a relevant law by reference to the terms of a contract made or to be made by the parties to that contract, but this is not what s. 105A says or attempts to say. It treats the Agreement as a contract that may be varied or rescinded by the parties.

It is convenient now to refer to the related statutory instruments which might be said to give the Agreement the force of law. Section 2 of the Financial Agreement Act 1928 approved the Agreement. In doing so it satisfied in part the condition precedent to the operation of the Agreement created by cl. 1 of the Agreement itself. That clause stipulated that the Agreement should have no force or effect unless and until it was approved by the Parliaments of the Commonwealth and of the States. It was therefore the function of s. 2 of the 1928 Act to satisfy this condition and, by giving statutory approval, it did no more than that - see Placer Development Ltd. v. The Commonwealth (1969) 121 CLR 353 , at pp 357-365 . The statute did not itself impose legal obligations on the parties to the Agreement to carry out its provisions. The same comment must be made about s. 3 of the Financial Agreement Act 1944 which approved the Agreement as it had been varied .

The Financial Agreement Validation Act 1929 satisfies the condition which is expressed in cl. 8 of the Agreement. Section 105A (2) contemplated that a statute validating an agreement made before the commencement of s. 105A would be enacted and conferred power upon Parliament in that respect. Validation is an authorization which operates retrospectively - see P. J. Magennis Pty. Ltd. v. The Commonwealth (1949) 80 CLR 382 , at pp 402, 410 .

I conclude, therefore, that the Agreement does not have the force of law, and for this reason cl. 4 (4) is not a law of the Commonwealth within the meaning of s. 86 (1) (c) of the Crimes Act. In reaching this conclusion I should make clear that I reject the defendants' submission that a law amending the Constitution stands outside the expression "law of the Commonwealth" and why I reject it.

In Reg. v. Foster; Ex parte Commonwealth Steamship Owners' Association (1953) 88 CLR 549 , at p 556 , the Court, when speaking of s. 109 of the Constitution, said:

"The expression 'inconsistent with a law of the Commonwealth' . . . relates to laws made under the legislative powers of the Commonwealth directly or indirectly."

A similar view was expressed by Barwick C.J. in Spratt v. Hermes (1965) 114 CLR 226 , at p 247 , when his Honour said that the expression "embraces every law made by the Parliament whatever the constitutional power under or by reference to which that law is made or supported: see per Dixon C.J. in Lamshed v. Lake (1958) 99 CLR, at p 148 ". The Chief Justice is not to be taken as confining "a law of the Commonwealth" to a law made by the Parliament so as to exclude a regulation made pursuant to statutory authority. For, as Windeyer J. observed in the same case (1965) 114 CLR, at p 276:

"The phrase 'laws made by the Parliament' seems to be less extensive in denotation than 'laws of the Commonwealth': see R. v. Kidman (1915) 20 CLR 425 , at p 438 . But, however that may be, I see no ground for refusing the name 'a law of the Commonwealth' to any law validly made by or under the authority of the Commonwealth Parliament wherever that law operates."

Windeyer J. was speaking of the use of the two expressions in ss. 76 and 80 of the Constitution. His statement gave expression to his view that the broad proposition in R. v. Bernasconi (1915) 19 CLR 629 , that Ch. 3 does not apply to the Territories is unacceptable. To that extent what his Honour said may require qualification because it was not a view which commended itself to a majority of the Court in that case .

So understood, the view expressed by Windeyer J. is at least as wide as that expressed in Reg. v. Foster; Ex parte Commonwealth Steamship Owners' Association (1953) 88 CLR 549 and by Barwick C.J. in Spratt v. Hermes (1965) 114 CLR, at p 247 . It certainly extends to laws made in or pursuant to the exercise of the legislative powers conferred upon the Parliament. For present purposes I am prepared to assume that s. 61 of the Constitution, when it speaks of "the execution and maintenance of this Constitution, and of the laws of the Commonwealth", draws a distinction between the Constitution as an Act of the Imperial Parliament and laws made by or under the authority of the Commonwealth Parliament and that this distinction is reflected in the expression "law of the Commonwealth" elsewhere in the Constitution so as to confine it to laws made by or under the authority of the Parliament in the exercise of its legislative powers. I am also prepared to assume that the expression is used in a similarly restricted sense in s. 86 (1) (c) of the Crimes Act, though I should be inclined to interpret it more widely. Yet it does not follow from this assumption that s. 105A of the Constitution, as a law amending the Constitution, stands outside the category of laws of the Commonwealth. A law that amends the Constitution is nonetheless a law made by the Parliament and, further, a law made by the Parliament in the exercise of the legislative power conferred upon it by s. 128 of the Constitution. The circumstance that the section prescribes compliance with special and additional conditions before the proposed law enacted by Parliament becomes a law does not in my view deny that what Parliament does under s. 128 is exercise legislative power. What distinguishes an exercise of power under s. 128 from the normal exercise of legislative power by the Parliament is that the section requires that the proposed law shall be submitted to a referendum and that it shall be passed at that referendum by a prescribed majority before it shall be presented to the Governor-General for the Queen's assent. What is required is the approval by the prescribed majority ascertained in the manner described in the section before the proposed law for alteration of the Constitution can be presented for assent. The section refers to the enactment before assent as a proposed law, this being the description that the Constitution elsewhere gives to bills before assent (see ss. 53 and 54), bills which, upon receiving assent, constitute laws made by the Parliament. Furthermore, it proceeds on the footing that the proposed law, when assented to, like all other laws made in the exercise of the legislative power, will take effect as law. In all this there is nothing inconsistent with the exercise of the legislative power of the Commonwealth which by s. 1 of the Constitution is vested in the Parliament consisting of the Queen, the Senate, and a House of Representatives. As I say, the only difference from an ordinary exercise of the legislative power lies in the prescription that before assent the approval of a prescribed majority of electors shall be obtained at a refendum.

I would therefore make a declaration that the first information discloses no offence known to the law. This conclusion has some importance for the questions relating to the production of documents.

An examination of the issues relating to the production of documents must begin with a reference to s. 26 of the Justices Act, 1902 (NSW), as amended, for the summonses requiring production of the documents in question were issued under that section. The section requires a Justice to issue a summons to a person to produce documents whenever on oath it is made to appear to the Justice "that any person . . . is likely . . . to have in his possession or power any document or writing required for the purposes of evidence". In this instance, each of the summonses was, with one exception, addressed to a named individual stating the official position or office which he held, requiring him to produce documents which, by their description, are clearly official documents of the Commonwealth. The one exception was a summons simply addressed to the Secretary of the Department of Minerals and Energy which called for the production of documents of a like character. Mr. McHugh, for the defendant Dr. Cairns, submitted that s. 26 does not, and cannot, authorize the production of Commonwealth documents on the ground that the State Parliament cannot legislate so as to bind the Commonwealth. This point was raised for the first time in this Court by a stranger to the summonses who has no interest in the documents, though he is a party to the proceedings. The submission has not been supported by the Commonwealth which is evidently content to have the documents produced by the persons to whom the summonses are directed if the claims to Crown privilege are overruled. The case should be approached accordingly, with the result that there is no occasion to canvass the scope of the operation which s. 26 has.

However, in passing it should be noted that the proceedings before the magistrate involved an exercise of federal jurisdiction because the first information is based on s. 86 (1) (c) of the Crimes Act. It would therefore be necessary to take into account s. 85E of the Crimes Act and ss. 68, 79, 80 and perhaps s. 64 of the Judiciary Act 1903, as amended. It might then be said that by virtue of Commonwealth law the provisions of s. 26 were made applicable to the proceedings - John Robertson & Co. Ltd. v. Ferguson Transformers Pty. Ltd. (1973) 129 CLR 65 , at pp 93-95 . Likewise, it would be necessary to consider those decisions which indicate that a subpoena ad test may be served on a person to compel the production of documents which he holds as servant or agent when his employer or principal consents to their production (Austin v. Evans (1841) 2 Man & G 430 (133 ER 814) ; Crowther v. Appleby (1873) LR 9 CP 23 ; Re Higgs; Ex parte Leicester (1892) 66 LT 296 ). As it is, I may put these problems to one side and turn to the question of Crown privilege.

Stephen J., in the reasons for judgment which he has prepared, has set out in detail the documents to which claims of Crown privilege have been made and the manner in which those claims have been formulated. His Honour has also stated the approach taken by the learned magistrate to the objections to production which were made. It will be sufficient, therefore, if I briefly state the categories into which the documents now in contention fall. They are:

1.

Explanatory memoranda and schedule containing recommendations relating to the revocation of authority to borrow $US4,000 million for temporary purposes approved by the Executive Council on 7th January 1975.

2.

Reports and correspondence from the Department of the Treasury or the Secretary of that Department in relation to the proposed borrowing of $US4,000 million for the period from 1st September 1974 to 20th May 1975.

3.

Reports from the Department of Minerals and Energy and/or Mr. R.F.X. Connor concerning the proposal to borrow overseas up to $US4,000 million.

4.

Australian Loan Council papers comprising -

(a)

Loan programmes submitted by or on behalf of the Commonwealth at Loan Council meetings held during 1974 and before 20th May 1975; (b) Loan programmes approved at any Loan Council meeting held during 1974 and before 20th May 1975; and

(c)

Minutes of all Loan Council meetings held between 1st January 1974 and 20th May 1975. 5. Minute paper from Mr. J. O. Stone to the Treasurer dated 10th December 1974 relating to a proposal for borrowing from Middle East sources. 6. Minute for file dated 13th December 1974 of a record of a meeting with the Prime Minister at 2 p.m. on that day, referring to the advice of the Solicitor-General and the Attorney-General that the proposed loan of$US4,000 million was valid under s. 61 of the Constitution without the need for Loan Council approval, being for temporary purposes in order to alleviate the critical employment situation.

7.

Cabinet submissions and decisions and Cabinet decisions without submissions relating to a wide variety of topics dealt with by Cabinet in the period after September 1973 and before 13th December 1974.

The documents described above, except those in categories 6 and 7, were the subject of summonses issued by the plaintiff. Those described in 6 and 7 were the subject of summonses issued by Mr. Whitlam. The Crown claims privilege in respect of all the documents listed above except those in category 1. Mr. Whitlam claims that the documents in that category are the subject of Crown privilege, notwithstanding the Crown's failure to object to production.

The claim of Crown privilege, to use a term acknowledged to be convenient, though apt to be inaccurate or misleading, is that the documents other than those in category 1 are immune from production because they fall into a class of documents which the public interest requires to be immune from disclosure. It is said that non-disclosure of the documents is necessary for the proper functioning of the Executive Government and the proper functioning of the Public Service. In some instances it is said that disclosure would inhibit complete candour in discussion. Except as to the Loan Council papers, it is not contended that the disclosure of information contained in the documents would itself be prejudicial to the national interest.

It has generally been assumed that important State documents relating to high level policy decisions, in particular Cabinet decisions and Cabinet papers, are immune from production (In re Grosvenor Hotel, London (No. 2) (1965) Ch 1210, at pp 1247, 1255 ; Conway v. Rimmer, [1968] AC 910 , at pp 952, 993 ; Reg. v. Lewes Justices; Ex parte Home Secretary (Rogers v. Home Secretary) [1973] AC 388 , at p 412 ; Lanyon Pty. Ltd. v. The Commonwealth (1974) 129 CLR 650 , at p 653 ; Australian National Airlines Commission v. The Commonwealth (1975) 132 CLR 582 , at p 591 ). It is now recognized that in considering an objection to production on the ground of Crown privilege the court must evaluate the respective public interests and determine whether on balance the public interest which calls for non-disclosure outweighs the public interest in the administration of justice that requires that the parties be given a fair trial on all the relevant and material evidence (Conway v. Rimmer [1968] AC 910 ; Alfred Crompton Amusement Machines Ltd. v. Customs and Excise Commissioners (No. 2) [1974] AC 405 ). In determining this question the court, though it will give weight to the Minister's opinion that the documents should not be produced, is entitled to inspect the documents and form its own conclusion upon the question whether the public interest will be better served by production or non-production.

Cabinet decision and cabinet papers do not stand outside the general rule that requires the court to determine whether on balance the public interest calls for production or non-production. They stand fairly and squarely within the area of application of that rule. Consequently, it has been accepted that the public interest does not call for the non-disclosure of cabinet documents when their significance is purely historical (Conway v. Rimmer [1968] AC, at p 952 ; Attorney-General v. Jonathan Cape Ltd. (1976) QB 752 ). The Commonwealth submits that, subject to this qualification, the public interest will always on balance be found to favour non-disclosure of cabinet decisions and papers, government policy documents and high level communications passing between Ministers and senior public servants.

To evaluate this submission it is necessary to identify, first, the various elements which sustain the public interest against production of documents of the kind referred to. In identifying these elements I have gained little assistance from the affidavits sworn by Ministers and heads of departments in support of the objection to production. They have sought refuge in the amorphous statement that non-disclosure is necessary for the proper functioning of the Executive Government and of the public service, without saying why disclosure would be detrimental to their functions, except for the reference to want of candour. Perhaps affidavits in this form were acceptable in the days when it was thought that the court should uphold an objection once made by the Crown through its appropriate representative. But they are plainly unacceptable now that the court is to resolve the issue for itself , after an inspection of the documents when that is thought to be appropriate. An affidavit claiming Crown privilege should state with precision the grounds on which it is contended that documents or information should not be disclosed so as to enable the court to evaluate the competing interests. The affidavits in this case fall far short of this standard and I must therefore look beyond them for the considerations which tend to support non-production.

In Conway v. Rimmer, Lord Reid said (1976) QB 752:

"Virtually everyone agrees that Cabinet minutes and the like ought not to be disclosed until such time as they are only of historical interest. But I do not think that many people would give as the reason that premature disclosure would prevent candour in the Cabinet. To my mind the most important reason is that such disclosure would create or fan ill-formed or captious public or political criticism. The business of government is difficult enough as it is, and no government could contemplate with equanimity the inner workings of the government machine being exposed to the gaze of those ready to criticise without adequate knowledge of the background and perhaps with some axe to grind. And that must, in my view, also apply to all documents concerned with policy making within departments including, it may be, minutes and the like by quite junior officials and correspondence with outside bodies.

Further it may be that deliberations about a particular case require protection as much as deliberations about policy. I do not think that it is possible to limit such documents by any definition. But there seems to me to be a wide difference between such documents and routine reports."

I agree with his Lordship that the possibility that premature disclosure will result in want of candour in cabinet discussions or in advice given by public servants is so slight that it may be ignored, despite the evidence to the contrary which was apparently given and accepted in Attorney-General v. Jonathan Cape Ltd. (1976) QB 752 . I should have thought that the possibility of future publicity would act as a deterrent against advice which is specious or expedient. I also agree with his Lordship that the efficiency of government would be seriously compromised if Cabinet decisions and papers were disclosed whilst they or the topics to which they relate are still current or controversial. But I base this view, not so much on the probability of ill-formed criticism with its inconvenient consequences, as upon the inherent difficulty of decision making if the decision-making processes of cabinet and the materials on which they are based are at risk of premature publication. Cabinet proceedings have always been regarded as secret and confidential. Both the Franks Committee in its report dated September 1972 and the Committee of Privy Councillors on Ministerial Memoirs (the Radcliffe Committee) in its report dated January 1976 considered that the efficiency of the Cabinet system would be seriously impaired if secrecy and confidentiality were not maintained. The Radcliffe Committee stated:

"33. . . . The constitutional doctrine which attributes to each member of a Government his share of collective responsibility for its actions and policies undertaken during the period of his membership is no more than an expression of this association in which individual attitudes and opinions are merged in the general resolution of the whole body. In our view such a system of working could not survive in practical terms unless the members were prepared to observe the confidentiality of all that has gone on in the course of their deliberations.

34. It is a mistake to suppose that these general conceptions represent any doctrine that is peculiar to the United Kingdom. The recent report of the Franks Committee, who in the course of their inquiry made a study of this question, suggests the reverse. They examined in some detail the relevant law and practice in four other countries, France, Sweden, Canada and the United States of America; and their finding was that: 'Governmental representatives in all four countries took it for granted that a Government cannot function completely in the open, but must be able to preserve the confidential nature of its internal processes, especially at the highest levels of policy making.'"

This, to my mind, is the reason which underlies the public interest against production and disclosure of cabinet proceedings and of other high level policy deliberations. Accordingly, it is the element which has to be weighed in the balance with public interest in the administration of justice in determining whether cabinet proceedings and high level deliberations should be disclosed.

It is at this point that I am unable to agree with all that Lord Reid said. First, a prohibition against the disclosure of cabinet proceedings "until such time as they are only of historical interest" seems to me to give overmuch protection to government at the expense of the litigant's right to a fair trial unless one takes an expansive view of what is "historical". For my part, I should have thought that, if the proceedings, or the topics to which those proceedings relate, are no longer current, the risk of injury to the efficient working of government is slight and that the requirements of the administration of justice should prevail. Even in such a case the court can diminish the risk by restricting access to such documents as may be produced.

In United States v. Nixon (1974) 418 US 683 (41 Law Ed 2d 1039) the Supreme Court refused, in the absence of a need to protect military, diplomatic or sensitive national security secrets, to accept the argument that the very important interest in confidentiality of presidential communications is significantly diminished by the production of such material for in camera inspection and went on to hold that this interest must give way to the superior public interest requiring that justice be done in criminal cases. The decision proceeded upon a consideration of constitutional provisions and principles which differ from ours. But it is significant that an issue which was broadly similar in character was decided in favour of the public interest in the administration of justice. On the other hand, the decision of the Full Court of the Supreme Court of Tasmania in Reg. v. Turnbull (1958) Tas SR 80 that cabinet proceedings are the subject of absolute privilege seems to reflect the law as it was thought to be before Conway v. Rimmer [1968] AC 910 and in my opinion it should not now be accepted.

The second qualification that I would make is that I see no reason to extend the umbrella of non-disclosure or non-production to all documents concerned with policy making in government departments . To ensure that the protection given to cabinet proceedings is effective, documents and communications passing between a Minister and the head of his department relating to cabinet proceedings and material prepared for cabinet must be protected. Further, as important matters of policy are resolved below the level of cabinet, documents and communications relating thereto passing between Ministers and public servants will be subject to Crown privilege as, for example, reports of inter-departmental and other government committees. But a distinction should be drawn between important matters of policy and those which are not.

As the range of issues which engage the attention of the Executive Government is infinite and as the manner in which those issues are considered varies from case to case, it is impossible to lay down hard and fast rules which will provide universal answers. Each case here, as elsewhere, depends upon its own circumstances and it is only by a consideration of them that a correct balance will be reached.

It may be said of all the documents in question in this appeal that they are cabinet papers, Executive Council papers or high level documents relating to important policy issues. They are, or were, all capable of sustaining an objection to production on the ground of Crown privilege at an appropriate time. However, they are not recent documents; they are three and a half to five years old. They relate to issues which are no longer current, for the most part policy proposals of Mr. Whitlam's government 0 which were then current and controversial but have since ceased to be so, except perhaps for the interest which arises out of the continuation of these proceedings. The principal issue to which they relate was the proposal to borrow $US4,000 million, a proposal which was abandoned by Mr. Whitlam's government and has not been revived. Except for the Loan Council papers the documents do not contain information which, if published, would prejudice the national interest. So much I infer from the absence of a claim to privilege on this ground. Indeed, I have the impression that many of the matters to which the documents relate are already matters of public knowledge by reason of the publicity which the events in question attracted.

It has been suggested that the Executive Council documents stand in a special position by reason of the oath of secrecy taken by Executive Councillors. But I do not think that this places Executive Council documents in a superior category, for it is well settled that confidentiality alone is not enough to render a document immune from production.

In these circumstances, except for the Loan Council documents, the claim for Crown privilege lacks great strength. On the other hand, the public interest in securing a trial of the charge of conspiracy in the second information is extremely strong. The documents, excepting once again the Loan Council papers, have an obvious relevance and materiality to the informant's case and to the defendants' defences. My impression, as that of Stephen J., is that to insist on non-disclosure in a case such as this would be to confer immunity on Ministers from prosecution. And with him I agree that it is not to the point that the prosecution is a private prosecution. However, in drawing attention to the great strength of the public interest in the administration of justice as it arises in the particular circumstances of this unique case I do not intend to suggest that it is those circumstances alone which justify the production of the documents. As I have said, the case for non-production is in itself not a strong one.

There is an additional reason why the explanatory memoranda and schedule in category 1 should be produced. The Commonwealth has no objection to their production. That is not to say that Mr. Whitlam cannot raise the point. He is a party to the proceedings and he may initiate a consideration of the issue by the court, for it is well established that the court may of its own motion withhold production where it thinks that the case is one of Crown privilege. But in this case the court must be strongly influenced by the circumstance that the Commonwealth, having examined the documents and having considered the public interest, has made no objection to production. Generally speaking, when a court acts in the absence of an objection to production by the Crown it is because the Crown has not had an opportunity to consider the question or has for one reason or another failed to exercise such an opportunity. This is not such a case.

In the case of Mr. Stone's minute paper there is an additional complication. According to the evidence, the contents of a document purporting to be a copy of Mr. Stone's minute paper was published in The Bulletin, a weekly journal with a substantial circulation. If it were established that a document the subject of a claim to Crown privilege had been widely published in the community it would be difficult to sustain the claim to privilege. The damage, if any, consequent upon disclosure would have occurred and the additional use of the document in court proceedings would make little, if any, difference. However, to say this assumes that the circumstances of the publication are such that they leave little or no doubt as to the authenticity of what is published. If, on the other hand, there exists real doubt as to the authenticity of what is published, production of the document in court and its comparison with the published material may serve to set the doubt at rest and thereby confer the mantle of authenticity on a publication which was made unlawfully or in breach of confidence. In some circumstances this consideration might constitute a reason for upholding an objection to production but not here, where for reasons already discussed, the case for production outweighs the case for non-disclosure.

In the light of my conclusion that the documents other than the Loan Council papers should be produced, I need not examine the question whether it would be a breach of parliamentary privilege to prove that the documents in question have been tabled in Parliament, thereby losing such privilege as might otherwise attach to them.

As no challenge was made to the validity of the second information and as the relationship between the concluding words of the offence there alleged and the subject matter of the conspiracy alleged were only touched upon in argument, I shall assume that the information is valid and that the concluding words are an integral part of the offence which it charges. On these assumptions the Loan Council documents would appear to be relevant to the second information as it is expressed . However, because the Loan Council documents contain confidential information relating to important matters of fiscal policy the publication of which would be detrimental to the public interest, the Court should inspect them and order disclosure to be made of that part of the documents as reveals the amount which the Commonwealth was authorized to borrow in the year 1974- 1975. The disclosure of this information would not be prejudicial to the public interest.

In the result I would make a declaration on Mr. Whitlam's cross claim that the first information discloses no offence and is bad. On Mr. Sankey's application I would make a declaration that all the documents in question, other than the Loan Council documents, are not privileged and should be produced. I would also declare that so much of the Loan Council documents as reveal the amount which the Commonwealth was authorized to borrow during the year 1974-1975 should be produced.