R v Hutson[2021] QDC 311

DISTRICT COURT OF QUEENSLAND

Introduction

1. [1]
   The defendant served the Proper officer of the Australian Securities and Investments Commission (ASIC) with two subpoenas to produce documents. Both subpoenas were issued on 26 March 2021. The subpoenas compel the production of the following documents:

   1. sign-in and sign-out records created for witnesses who visited an ASIC office in relation to the G8 Education Limited investigation (attendance records);
   2. draft witness statements prepared in relation to the G8 Education Limited investigation (draft witness statements); and
   3. an ASIC enforcement manual, in the form promulgated as at 17 November 2015 (the enforcement manual).
2. [2]
   ASIC responded to the subpoenas in two ways. First, by producing a number of draft witness statements. Second, by filing an application under rule 33(1)(b) of the Criminal Practice Rules 1999 for orders narrowing, or setting aside, the subpoenas.
3. [3]
   The application is opposed by the defendant.
4. [4]
   The Commonwealth Director of Public Prosecutions was represented at the hearing, but did not play an active part in supporting, or opposing, the application.

Background and the defence case

5. [5]
   From July 2015, ASIC began to monitor and investigate a takeover bid for Affinity Education Group Limited (Affinity) by G8 Education Limited (G8). The defendant was a director and chairperson of G8. Shares were purchased in Affinity in July 2015 by West Bridge Holdings Pty Ltd (West Bridge).
6. [6]
   The ASIC investigation, in due course, led to the defendant being charged with 29 offences on two indictments.
7. [7]
   The first indictment contains 14 counts. In substance, it is alleged the defendant breached provisions of the Corporations Act 2001 and the Criminal Code when:

   1. she used her position to execute a sham secured loan agreement purporting to commit G8 to a loan of $15,000,000 to disguise the purchase of shares in Affinity by a third party;^[1]
   2. in the exercise of her powers and discharge of duties as a director, she authorised and directed the transfer of $15,000,000 of G8’s funds to a law firm trust account with the intention it be applied by West Bridge to fund the purchase of shares in Affinity;^[2]
   3. she used her position to direct the transfer of $10,000,000 from G8’s solicitor to the trust account of another law firm to conceal the purchase of shares in Affinity;^[3]
   4. she dishonestly authorised the purchase of shares in ANZ Banking Group Limited with funds that belonged to G8;^[4]
   5. as an officer of G8, she permitted a number of documents to be lodged with the Australian Stock Exchange that failed to accurately disclose G8’s relevant interest in Affinity;^[5] and
   6. she attempted to pervert the course of justice by meeting with Nigel Elias and providing him with documents purporting to reflect an arrangement for the purchase of shares in ANZ Banking Group Limited, which falsely assumed funds were provided by Nigel Elias.^[6]
8. [8]
   The defendant denies each of these allegations.
9. [9]
   As part of its investigation, the defendant was compulsorily examined by ASIC officers under s 19 of the Australian Securities and Investments Commission Act 2001 (the Act).  At the time the relevant notice was issued under s 19, the defendant was not a witness, but a person of interest. She was examined at length, and on two occasions. The second indictment contains 15 counts, each alleging the defendant gave false or misleading information in the course of her compulsory examination.
10. [10]
    The defendant denies these allegations.
11. [11]
    For the purposes of this application, the Defendant’s outline of submissions identified two key issues that lie at the heart of the defence case.^[7] In broad terms, the defence case involves a challenge to the credibility of three witnesses, namely Nigel Elias, Mary-Anne Greaves and Charles Green. Second, the defence case involves an attack on ASIC’s investigation, which is said to be redolent with ‘gross investigative failures’. The two key issues are interrelated.
12. [12]
    Elias, Greaves and Green are important witnesses to the Crown case.^[8] Mr Bastianon, the project officer for the ASIC investigation, conceded they are ‘significant prosecution witnesses’^[9]. Each were subject to compulsory examinations under s 19 of the Act. After examination, each witness signed a statement. 
13. [13]
    The defence case seeks to attack the credit of these witnesses. Part of that attack is founded on the proposition they signed statements departing, in material respects, from sworn evidence given under compulsory examination.^[10] The evolution of the evidence from the version given under compulsory examination to the signed statement is therefore a point of focus. It is a point that finds some support in the evidence of Mr Paleologos. He is employed by ASIC as a Senior investigator and was involved in the investigation of the defendant. In this role, Mr Paleologos was responsible for, inter alia, drafting witness statements in conjunction with Mr Bastianon. Mr Paleologos agreed that Mr Elias’ signed statement was different to his compulsory examination.^[11]
14. [14]
    The defence case also involves an attack on the integrity and fairness of the ASIC investigation that led to the production of witness statements.  Paragraph 7 of the Defendant’s outline of submissions states:

“…The process by which witness accounts developed from versions given in compulsory examinations conducted pursuant to section 19 of the ASIC Act to those contained in the final statements is of central importance to the credit of key witnesses (including the investigators) and the investigative process. These matters lie at the heart of the defence case.”

15. [15]
    Mr Bastianon and Mr Paleologos gave evidence at the Committal, and before me, in relation to the process they adopted to develop witness statements.
16. [16]
    Mr Bastianon is a ‘Senior lawyer’ in the Corporations and Corporate Governance (CCG) enforcement team in ASIC. In that role, he was the project manager for the investigation.^[12]  Mr Paleologos is a lawyer and, as I have already said, holds the position of ‘Senior investigator’. He works in the same enforcement team as Mr Bastianon. They worked together during the investigation, and were responsible for preparing a brief of evidence for the Commonwealth Director of Public Prosecutions (CDPP). The brief included signed witness statements, which Mr Bastianon and Mr Paleologos depose to drafting in their capacity as lawyers.
17. [17]
    In attacking the investigation and the process for preparing witness statements, the defence point out: (1) there are in existence hundreds of draft statements for key witnesses (and others); (2) witness statements prepared by Mr Bastianon and Mr Paleologos do not address the process adopted to develop and draft witness statements;^[13] (3) there are limited notes kept about the evolution of witness statements, including an absence of notes in relation to conferences with witnesses;^[14] (4) witnesses conveyed information to Mr Bastianon and Mr Paleologos about which there are no notes and, in any event, the information did not find its way into a draft statement because a ‘judgment call’ was made about, inter alia, relevance;^[15] (5) save for compulsory examinations, no witness conferences were recorded (audio or video);^[16] (6) Mr Green, who is a key witness, was given a ‘letter of comfort’ to the effect that ASIC would not commence proceedings against him if he gave evidence in accordance with his signed statement, which is different in material respects to his compulsory examination.^[17]
18. [18]
    ASIC seek to withhold from production 324 draft witness statements (in whole), and have redacted notes made in the margin of 13 additional draft statements.^[18]  As I understand ASIC’s position, it does not suggest this is because the subpoena fails for want of a legitimate forensic purpose, or is a fishing expedition.
19. [19]
    The defence case also involves an attack on the decision made by Mr Bastianon and Mr Paleologos to compel the defendant to participate in a compulsory examination under s 19 of the Act. The relevant notice was given to the defendant on 6 May 2016, after she had declined to participate in a voluntary record of interview. The examination took place, in part, on 25 May 2016. At the conclusion of the examination, it was adjourned to a date to be fixed. It was resumed on 22 June 2016, and concluded that day.
20. [20]
    The defence seek to attack the lawfulness and timing/purpose of the defendant’s examination.  The former point was relevant to an application for a permanent stay that was recently determined by this Court.^[19] As to the latter, it is suggested the timing and purpose of the examination was unfair. As I understand it, the fundamental proposition underlying this contention is that the decision to conduct the examination was to facilitate ‘plugging’ of evidentiary gaps, and to procure evidence consistent with ASIC’s case theory.^[20]  Particular reference was made in this regard to an email from Mr Bastianon to his manager, Mr Caridi, dated 5 April 2016. The email states, in part:^[21]

“…We will, of course, need to examine Hutson and then review her evidence to see what ‘holes’ need to be covered as a result of what we are told and to assess any possible defences.”

21. [21]
    Prior to the Committal hearing, the defendant filed an application for disclosure. Specific orders were sought on her behalf in relation to attendance records and draft witness statements.^[22] During the course of the hearing, Mr Clelland QC cross-examined Mr Bastianon and Mr Paleologos.  The transcript reveals that additional documents were called for during the course, and as a consequence, of their evidence.  The call for documents included a call for the enforcement manual, which was referred to by Mr Bastianon and Mr Paleologos in their oral evidence.^[23] Mr Clelland QC cross-examined them both as to whether the enforcement manual informed the decision to issue the defendant with a notice under s 19 of the Act, and the process adopted to draft witness statements.^[24] ASIC opposed the call for the enforcement manual and draft witness statements (in part). The defendant’s application seeking orders compelling the production of the attendance records, enforcement manual and a large body of draft witness statements (in whole and in part) was dismissed. No party suggested the subpoenas issued in this Court were an abuse of process in the face of this history.^[25]
22. [22]
    Before turning to deal with ASIC’s objections, I will firstly set out the principles that govern the production of documents under subpoena.

Relevant principles (production of documents under subpoena)

23. [23]
    The principles governing the production of documents under subpoena were, save for one matter, uncontroversial.^[26] By reference to a number of authorities, including Attorney General for New South Wales v Chidgey (2008) 182 A Crim R 536^[27] and Alister & Ors v The Queen (1984) 154 CLR 404,^[28] the submissions made on behalf of ASIC summarised the relevant principles as follows (footnotes omitted):^[29]

“First, the party seeking production must identify expressly and precisely the legitimate forensic purpose for which access to the documents is sought. This means that it will ordinarily be necessary for that party to identify the issue or issues in dispute at trial; what the party’s case will be on that issue or those issues; how the summonsed documents will assist the summonsing party in his case; and what are the grounds for believing the documents will in fact so assist.

Secondly, that party must also satisfy the court that it is ‘on the cards’ that the documents sought ‘will materially assist the defence’. In other words, it is not enough that the document sought is or may be relevant to the proceeding. As Mahoney AP observed in Carroll v Attorney General (NSW):

[I]t is not sufficient for a party [seeking production of the] document to say “the document is relevant because, if it does anything, it establishes the case against me”. He must be able to indicate that the document is relevant in the sense that it may assist his case. In this present case, that could not be claimed. Nor was it shown. At best, the claim was: “I wish to see the document to see if it may assist my case.” That, in my opinion, is not sufficient.

Thirdly, and conversely, a ‘fishing expedition’ is not a legitimate forensic purpose and will not be permitted. Thus, a party cannot seek disclosure merely in order to determine whether documents may be relevant and may assist his or her case. Nor can a party use a subpoena or production order ‘to investigate whether [a] case might be broadened to cover material facts and matters not yet pleaded’.”

24. [24]
    As to the matter of controversy, the Defendant’s outline of submissions contends there is no ‘third’ requirement as contended in the ASIC submissions.^[30]  I accept this is technically correct, but it does not take the matter very far. I have not treated the third submission set out above as an additional requirement. Rather, the submission is properly understood as identifying circumstances where a subpoena will fail the legitimate forensic purpose test. It will fail where it is characterised as a fishing expedition.
25. [25]
    My attention was also drawn to authorities touching upon the principles set out above and their application to documents sought by an accused. Mr Clelland QC and Ms Shann’s written submissions helpfully set out a detailed discussion in relation to relevant authorities at paragraphs 77 to 86. It is unnecessary to repeat those submissions in detail. I, however, note the following submissions were made, namely:

    1. in reliance upon Alister (Supra), it was submitted that “in determining whether it is on the cards that the documents would materially assist the accused in its defence, the court must adopt a liberal approach in a criminal case”;^[31]
    2. in reliance upon Zirilli v The Queen [2021] VSCA 2, it was submitted that the ‘on the cards’ test should be applied flexibly “in order to give the accused a fair opportunity to test the Crown’s case and to take advantage of any applicable defences”;^[32] and
    3. in reliance upon Alister (Supra), it was submitted that the “on the cards test has been described as a relaxation of the test in applicable civil cases” and “special weight must be given to the fact that documents, or information gleaned from them, may assist an accused”.^[33]
26. [26]
    I will now turn to deal with ASIC’s objections to the subpoenaed documents.

Attendance records

27. [27]
    The subpoena with respect to the attendance records compels production of the following:

“1. Sign in and sign out records created when a witness has visited an ASIC office in relation to the G8 Education Limited investigation 16/0002 since 17 November 2015 including:

1. any electronic sign in record in the exact native form of the document on original media or as a copy on a USB device; and
2. any hard copy sign in record (including a carbon record).”

28. [28]
    ASIC opposes production of the attendance records for three reasons. The reasons are:^[34] (1) there is no legitimate forensic purpose for the production of the records; (2) it is not on the cards the records would assist the defence; and (3) seeking access to the attendance records amounts to a fishing expedition.
29. [29]
    I do not accept the submissions made on behalf of ASIC.
30. [30]
    The defendant has identified a legitimate forensic purpose for production of the attendance records.
31. [31]
    In summary terms, the attendance records will establish when a witness arrived and departed an ASIC office.^[35] By inference, this information can be used to establish the time a witness spent with ASIC investigators. The records can also be used to establish, by inference, that a witness did not attend ASIC, that is, they can be used to confirm that a witness statement was not produced as a result of an in-person conference with ASIC investigators.
32. [32]
    In and of itself, this information does not prove, or disprove, an element of any alleged offence, but it is relevant to the attack on the credit of key Crown witnesses and the process adopted by Mr Bastianon and Mr Paleologos to prepare witness statements. More particularly, it can be used in relation to: (1) an attack on the credit of investigators, who the evidence establishes, kept no, or poor records, of dealings with key witnesses; (2) an attack on the integrity of the ASIC investigation in terms of the time a key witness, Mr Elias, spent with investigators before signing a lengthy statement, which is said to be inconsistent with evidence given in a compulsory examination – the evidence suggests Mr Elias spent only a few hours with ASIC investigators who showed him a draft statement on a ‘screen’ before it was signed; and (3) an attack on the credit of key witnesses who signed lengthy witness statements in circumstances where they did not attend ASIC for an in-person conference.
33. [33]
    Given the defence case involves a direct attack on the integrity and fairness of the ASIC investigation, and given there is a paucity of notes kept by investigators about their dealings with key witnesses, I am satisfied it is on the cards the attendance records would materially assist the defence case. It will assist the defence to reconstruct, in part, the timeline for the preparation of statements for key witnesses. This timeline can be used to facilitate the erosion of a witnesses’, and/or investigators’, credit.^[36]
34. [34]
    ASIC’s application to set aside the subpoena requiring production of the attendance records is dismissed.

Draft witness statements

35. [35]
    The second subpoena issued 26 March 2021 requires production of the following documents:

“All drafts, whether in draft or final form, of each witness statement in relation to the G8 Education Limited investigation 16/0002 in the exact native form of the document on original media or as a copy on a USB device, including:

1. all drafts produced by the Australian Securities and Investments Commission;
2. all drafts sent and received by the Australian Securities and Investments Commission; and
3. every version of each draft witness statement produced, held by, sent or received by the Australian Securities and Investments Commission.”

36. [36]
    ASIC did not contend the subpoena compelling production of the draft witness statements was a fishing expedition. Nor did it contend the defendant had failed to identify a legitimate forensic purpose for production. ASIC seeks an order narrowing the scope of this part of the subpoena on the basis of a claim for legal professional privilege.
37. [37]
    ASIC has the onus of establishing the claim.^[37] The onus may be discharged by pointing to the nature of the documents, or by evidence describing the circumstances in which they were brought into existence.^[38] Conclusionary assertions are not sufficient to make good on the claim.^[39]
38. [38]
    Mr Bastianon confirmed ASIC seek to withhold draft witness statements falling into two categories.^[40] The first category are draft statements not shown to, or adopted by, a witness. The statements falling into this category are identified in exhibit MB-13 to Mr Bastianon’s affidavit sworn 30 June 2021 (MB-13). The second category are draft statements that have been redacted, in part. The statements falling into this category are identified in exhibit MB-14 to Mr Bastianon’s affidavit sworn 30 June 2021 (MB-14). The redactions are found in the margins of the statements.
39. [39]
    MB-13 identifies 324 draft witness statements for 20 witnesses by, inter alia, ‘document title’. Each draft is said to be prepared by a lawyer, namely ‘Peter Paleologos or Mathew Bastianon’. The claim for legal professional privilege is founded on three assertions:

    1. first, the draft witness statements were not shown to, or adopted by a witness;^[41]
    2. second, the draft witness statements were created by Mr Bastianon and Mr Paleologos in their capacity as a lawyer (employed by ASIC) for reasonably anticipated litigation;^[42] and
    3. third, the draft witness statements were prepared in anticipation of, and for the dominant purpose of, commencing a prosecution against the defendant, and/or, for the purpose of providing legal advice.^[43]
40. [40]
    MB-14 is a schedule identifying the document title for 13 draft statements for three witnesses. The drafts are subject to a partial claim for privilege. Ten of the statements were prepared by ‘Peter Paleologos or Mathew Bastianon’. Three statements were prepared by ‘Emma Farnsworth’, but reviewed by ‘Peter Paleologos or Mathew Bastianon’. The partial claim for legal professional privilege is stated as follows:

“This draft statement is subject to a partial claim for LPP, in which the information the subject of LPP has been redacted. The part of each draft witness statement over which LPP is claimed contains confidential legal advice provided in the course of the preparation of the draft witness statement or contains information which was provided in connection with; and for the dominant purpose of reasonably anticipated litigation”

41. [41]
    ASIC’s privilege claim in respect of MB-13 and MB-14 is advanced in reliance upon ‘advice privilege’ and, further or in the alternative, ‘litigation privilege’.
42. [42]
    Advice privilege attaches to confidential communications between a legal adviser in their professional capacity and client, or third party, for the dominant purpose^[44] of giving, or receiving, legal advice.^[45] It is not sufficient to show the ‘substantial purpose’ for the confidential communication is legal advice, or that the communication is legal advice, being one of two purposes of equal weighting. The dominant purpose must be the paramount, or most influential purpose.^[46] The privilege extends to documents prepared for the purpose of obtaining advice, even where they do not constitute communications, such as research memoranda, or chronologies.^[47]
43. [43]
    Litigation privilege attaches to confidential communications passing between a legal adviser or client, and a third party, if made for the dominant purpose of use in, or in relation to, litigation (including criminal proceedings), then existing or reasonably anticipated.^[48]  Litigation will be ‘reasonably anticipated’ when there is a real prospect, rather than a mere possibility, of litigation determined by an objective view of the circumstances.^[49]  Like advice privilege, it extends to documents that are not communications, provided they are brought into existence for the dominant purpose of preparing for, or use in, litigation.^[50]
44. [44]
    I will now deal with the privilege claims made in relation to MB-13 and MB-14 separately.

MB-13

45. [45]
    ASIC’s claim with respect to the draft statements identified in MB-13 is on a sound footing. In general terms, the evidence establishes:

    1. the statements were drawn by ASIC employees, using their legal skills;
    2. the statements were for discussion purposes between, and for settling by, two lawyers prior to presentation to a witness for his, or her, consideration;
    3. the statements were not shown to, or adopted by, any witness; and
    4. the statements were evolving with the end goal that they be included in a brief of evidence to the CDPP, that is, for use in relation to reasonably anticipated criminal proceedings against the defendant.
46. [46]
    It is necessary to develop these matters further.
47. [47]
    As a general proposition, it has been recognised that witness statements are the work product of a lawyer to which legal professional privilege will ordinarily attach when in draft form, and in the hands of the lawyer, the client or their agent.^[51] This can be readily accepted given the very nature of the document. It is a ‘draft’. As a draft, it may be a discussion document between lawyers that evolves through successive iterations prior to consideration, and adoption, by a witness. This stands in stark contrast to a final witness statement. A document of this kind assumes a different character. It is prepared to disclose the evidence of a witness to the opposing party.^[52]
48. [48]
    Whether the general proposition applies turns on the facts and circumstances of each case. In my view, there are three matters, taken in combination, that establish the general proposition applies to the draft statements identified in MB-13.
49. [49]
    First, the statements were prepared by Mr Bastianon and Mr Paleologos. They were, at the relevant time, admitted to practice as Lawyers and responsible for, inter alia, providing independent and objective legal advice. Neither were subject to direction by non-lawyers in the provision of legal advice to ASIC.^[53]
50. [50]
    Mr Bastianon and Mr Paleologos each said their legal skills, and independence, as a lawyer, were brought to bear in the drafting exercise. Mr Bastianon explained how this occurred (in general terms) in the following exchange with Mr Clelland QC in cross-examination:^[54]

“…On what basis do you say you prepared the draft witness statements as a lawyer?---Well, as I’m drafting the witness statements, I’m giving consideration to the many sorts of legal issues that arise in preparing evidence…Sufficiency of evidence, knowledge of the particular offences that are being considered and whether the evidence is sufficient to that, what gaps there might be in the evidence, issues of hearsay, issues of admissibility of evidence. All of those sort of things were in the forefront of my mind when I’m drafting witness statements.”

51. [51]
    Mr Paleologos gave evidence before me to similar effect.^[55]
52. [52]
    Drafting a witness statement, whilst considering: (1) the elements of an offence; (2) the sufficiency of the evidence to prove each element of an offence; and (3) evidentiary issues with respect to admissibility; is, in my view, fairly characterised as the work of a lawyer.  The evidence establishes that Mr Bastianon and Mr Paleologos drafted the witness statements in MB-13 with these very considerations in mind.
53. [53]
    Second, Mr Bastianon and Mr Paleologos developed draft statements as between themselves before presenting a ‘settled’ statement to a witness for consideration.  The process adopted to draft the statements was as follows.
54. [54]
    Mr Bastianon, who was responsible for the day-to-day running of the investigation as a Project manager and Senior Lawyer,^[56] said a ‘critical part’ of the investigation involved drafting witness statements for inclusion in a brief of evidence to the CDPP.^[57]  They were drafted jointly by Mr Bastianon and Mr Paleologos, and evolved over time.^[58]  The extent to which they contributed to each statement varied.^[59] The content of the statements were drawn, generally, from a number of different sources, including s 19 examinations and documents received by ASIC from third parties.^[60]  Whilst the drafting process did require some witnesses to provide clarification, Mr Paleologos confirmed that the practice adopted was to seek clarification without conveying the contents of the draft statement to the witness.^[61]  Statements were not presented to witnesses until Mr Bastianon and Mr Paleologos were ready to ‘settle’ the document.^[62]  The manner in which draft statements were provided to witnesses for their consideration was not uniform.  Some of the witnesses attended an in-person conference (such as Mr Elias). Some of the witnesses received the draft by way of an email to their solicitor (such as Ms Greaves).^[63]
55. [55]
    Mr Bastianon and Mr Paleologos each deposed to the fact that draft witness statements contained in exhibit MB-13 had not been shown to, or adopted by, a witness. This matter was taken up with Mr Paleologos in cross-examination before me. He was pressed by Mr Clelland QC as to how he satisfied himself that ‘not one of the drafts had ever been shown to a witness’.^[64] In response to this question, Mr Paleologos said he reviewed all of the draft statements individually for the purposes of disclosure. As part of that process, he identified whether they had been shown to, or adopted by, a witness.^[65]
56. [56]
    One might be forgiven for approaching Mr Paleologos’ evidence about this point with some hesitation given: (1) the number of draft witness statements in schedule MB-13 (324); (2) the number of witnesses (20); and (3) the paucity of notes in relation to dealings with critical witnesses about their statements. That said, this hesitation fairly dissipates once two matters are appreciated. First, the number of draft statements ought not be seen as indicative of anything. The large number was explained by Mr Bastianon by reference to the electronic system used for the management of files within ASIC, known as Sharepoint.^[66] This system has a ‘versioning function’. This function was enabled for the investigation and created a new draft statement periodically, or where the electronic file was opened, edited or saved. New drafts of documents appear to have been created by Sharepoint irrespective of whether a document was, in fact, altered by Mr Bastianon or Mr Paleologos.^[67]   Second, and more importantly, the hesitation fairly dissipates once it is appreciated the process adopted by Mr Bastianon and Mr Paleologos for drafting statements was uniform. The statements were, in effect settled, then provided to the witness for their consideration. This process was adopted even though Mr Bastianon and Mr Paleologos could have readily sent any of the numerous draft statements, at any time, to a witness in electronic or hard copy. They simply did not adopt this course.^[68]
57. [57]
    Third, for a valid claim of legal professional privilege to attach to the draft witness statements in MB-13, it must be established the documents were created for the dominant purpose of giving confidential legal advice, or for use in, or in relation to, reasonably anticipated litigation. The affidavits of Mr Bastianon and Mr Paleologos swear this issue.^[69]  I have not acted on those assertions. Rather, I have approached the matter on the basis that the issue must be determined, objectively, having regard to the evidence.
58. [58]
    The evidence reveals that a decision was made to commence a formal investigation into G8 and its directors/former directors for suspected contraventions of the Corporations Act 2001 on 12 January 2016.^[70]  After this decision was made, an internal scoping memorandum for the investigation was prepared, and dated 21 January 2016.^[71] The memorandum, read as a whole, leaves the reader with the clear impression that: (1) the investigation was commenced against the defendant on an advanced footing; and (2) the purpose of the investigation was to determine whether criminal charges should be pursued in the context of an already well advanced investigation.
59. [59]
    Mr Bastianon and Mr Paleologos were materially involved in the analysis set out in the memorandum of 21 January 2016.^[72] In that document, the defendant is referred to as a person of interest, as distinct from a witness.^[73]  The analysis of the circumstances set out in the document call in aid evidence procured in an earlier investigation associated with proceedings before the Takeovers Panel.^[74]
60. [60]
    As to the earlier proceedings and investigation, in August 2015, Affinity applied to the Takeovers Panel for a declaration of unacceptable circumstances. The relief sought related to the acquisition of Affinity shares by G8 and associated entities. Contraventions of the Corporations Act 2001 were also alleged.^[75] The matter was, as a consequence of these allegations, referred to an enforcement team within ASIC for investigation. The team gathered substantial documentary evidence from parties involved. Submissions made to the Takeovers Panel by ASIC were based upon these investigations.^[76] In October 2015, the Takeovers Panel made a declaration of unacceptable circumstances along with orders requiring the divestment of shares in Affinity. The Takeovers Panel also found there to be contraventions of the Corporations Act 2001. These findings, along with the declarations and consequential orders, led to the matter being referred, internally, to the CCG enforcement team, of which Mr Bastianon and Mr Paleologos are a part.
61. [61]
    The investigation conducted by the CCG enforcement team into the defendant spring boarded off the earlier investigative work, and Takeovers Panel proceedings. The scoping memorandum expressly acknowledged this assistance at paragraph 15, where it was said:

“CCG Enforcement has access to large number of documents already obtained pursuant to Notices served on relevant parties by Corporations that are relevant to the investigation of these matters.  CCG Enforcement also has the benefit of the evidence and submissions put to the Panel by the parties. This will not only reduce the extent of the evidence gathering that needs to be undertaken, but will inform the focus of the investigation.”

62. [62]
    The extent to which further evidence was required to be gathered is discussed at paragraphs 17 and 18 of the scoping memorandum.
63. [63]
    Paragraph 17 states:

“The available evidence indicates there is scope for CCG Enforcement to commence its own investigation in relation to suspected takeover provisions and directors’ duties contraventions in order to establish whether criminal proceedings should be commenced against any person or entity in relation to the alleged conduct.” (emphasis added) 

64. [64]
    Paragraph 18 states:

“While the Panel found contraventions of the Act had occurred, the evidence on which it relied for such findings, including the inferences drawn from such evidence, would not in our view be sufficient to meet the higher standard of proof required to prove the commission of criminal offences under the Act.”  (emphasis added)

65. [65]
    Based on the date of the scoping memorandum, it can be inferred that the investigation carried out by Mr Bastianon and Mr Paleologos commenced from the position there was sufficient evidence to found a suspicion the defendant had committed offences. The purpose of the investigation was to marshal available evidence, and procure additional evidence, to determine whether criminal proceedings should be commenced. This was not seen as a difficult task. In a memorandum dated 13 November 2015, a member of the CCG enforcement team expressed the view there were ‘no apparent difficulties in obtaining the evidence that would be required to substantiate the allegations’.^[77]
66. [66]
    The CCG enforcement team, as part of the investigation, created witness statements to record evidence. If considered only in this narrow light, it can be said that the drafts were created for an investigative purpose. This is not, however, the only purpose for the creation of the statements.
67. [67]
    Mr Bastianon in his oral evidence^[78] said ‘the whole purpose of drafting a witness statement is to prepare your evidence and put your evidence into admissible form and for consideration by…the DPP on whether charges should be brought or not’. This is precisely what occurred here. Statements were prepared to put evidence in admissible form for: (1) inclusion in a brief of evidence to the CDPP; and (2) the CDPP to consider whether criminal proceedings should be commenced against the defendant. To prepare draft witness statements for this purpose is, in my view, fairly characterised as being for, or in relation to, anticipated legal proceedings.
68. [68]
    Given there are two purposes that can be attributed to the creation of the draft witness statements, what, if any, was the dominant purpose for their creation?
69. [69]
    I am satisfied the dominant purpose for the draft witness statements in MB-13 was for, or in relation to, anticipated criminal proceedings. This is so having regard to the following matters.
70. [70]
    The evidence establishes that Mr Bastianon and Mr Paleologos formed more than preliminary, but not final,^[79] views early in the investigation that offences had been committed by the defendant. This is explained in large measure by the examination of a key witness, Mr Elias. This occurred on 22 February 2016. Mr Bastianon said it was Mr Elias’ evidence that permitted a necessary connection to be made between the defendant and the acquisition of shares in Affinity.^[80]  This examination, along with the early investigative work, provided the foundation for an anticipation that criminal proceedings against the defendant were a real prospect. 
71. [71]
    A precise date cannot be identified as to when this anticipation could be said to have crystallised in a clear way, but I accept criminal proceedings against the defendant were a real prospect in, and from, March 2016. This is established by refence to Mr Bastianon’s oral evidence before me.^[81]  His evidence in this regard is also supported by three other parts of the evidence, namely: (1) an email transmission dated 5 April 2016; (2) Mr Bastianon’s evidence at the Committal; and (3) Mr Paleologos’ evidence at the Committal.
72. [72]
    Mr Bastianon sent an email to his supervisor, Mr Caridi, on 5 April 2016.^[82] The purpose of the communication was to identify a ‘best estimate’ for when a brief of evidence to the CDPP would be ready. The estimated date was 15 July 2016. The substance of the email reflects that achievement of this date was contingent upon the timing of responses to notices to produce, the preparation of witness statements and the ‘need to examine’ the defendant and review her evidence. After dealing with the matters that had the potential to disrupt the preparation of the brief of evidence, the email goes on to suggest there may be utility in seeking advice in relation to ‘proposed charges’. The charges anticipated at this time were identified by Mr Paleologos. He said the charges were those identified during the Takeovers Panel proceeding, and additional breaches of director’s duties.^[83]
73. [73]
    Mr Bastianon was cross-examined at the Committal about the email of 5 April 2016. By reference to the email, Mr Bastianon conceded that, by the date it was sent he: (1) suspected the defendant had committed criminal offences;^[84] (2) was intending to recommend criminal charges against the defendant;^[85] and (3) thought the defendant should be prosecuted.^[86]
74. [74]
    Mr Paleologos was cross-examined at the Committal about when he knew criminal charges would be recommended against the defendant. The transcript of the evidence reveals Mr Paleologos accepted that this was in April 2016. The Court can have confidence in this given Mr Paleologos’ evidence in relation to the email transmission of 5 April 2016. When reminded of the email, he accepted the document was referring to ‘proposed charges’ that ASIC intended to recommend to the CDPP at that time.^[87] The Court can also take confidence from the timing of the decision to interview or examine the defendant. The decision appears to have been made in late April 2016. Mr Paleologos accepted that the purpose of a record of interview with the defendant was to put alleged criminal conduct to her.^[88] He also accepted that the examination was going to be conducted at a time when it was intended to recommend criminal charges against the defendant.^[89]
75. [75]
    With these features of the evidence in mind, and taking into account the advanced state of the investigation as at January 2016, it is not difficult to conclude that criminal proceedings against the defendant were reasonably anticipated in or about March 2016, with that anticipation gaining strength in April 2016. Drafting of witness statements commenced in and around this time. Indeed, all but five^[90] of the 324 draft statements are dated, or post-date, April 2016. Only five statements predate April 2016; they are dated March 2016.
76. [76]
    In circumstances where: (1) the commencement of criminal proceedings against the defendant was a real prospect as at, and from, about March/April 2016; (2) the drafting of witness statements commenced in and about March/April 2016; and (3) witness statements were drafted for inclusion in a brief of evidence to be provided to the CDPP; an inference can be drawn that the dominant purpose for the draft witness statements was for use in relation to reasonably anticipated legal proceedings. This is the inference I have drawn having regard to the evidence.
77. [77]
    The alternative view is that there is either no identifiable dominant purpose, or the statements were prepared for an investigative purpose. The difficulty, in my view, for either position is that there is unlikely to be a ‘bright line’ delineating an investigation from the exercise of legal skills in a case such as this.^[91]  For example, Mr Bastianon said investigations were ongoing even at the time a notice was issued under s 19 of the Act to the defendant in May 2016.^[92] In circumstances where there is no bright line delineating an investigation from legal work, it has been recognised that a practical approach can be adopted to ascertain the dominant purpose for creation of the document that is the subject of a privilege claim. That involves asking this question: would the draft witness statements in MB-13 have been brought into existence irrespective of the litigation purpose? If resolved in the negative, this suggests the dominant purpose is one for, or in relation, to litigation.
78. [78]
    I am satisfied the question stated above is answered in the negative. This is so having regard to the following factors, namely: (1) the advanced state of the investigation when it commenced in January 2016; (2) that Mr Bastianon and Mr Paleologos had formed views early in the investigation, in about March/April 2016, that the defendant had committed offences; (3) that a date (best estimate) for the delivery of a brief of evidence was identified on 5 April 2016; and (4) the drafting process commenced in March 2016, with a large body of drafting occurring in and after April 2016 for the purposes of preparing witness statements for a brief of evidence.
79. [79]
    Each of the matters traversed in paragraphs [47] to [78] persuade me the draft witness statements identified in MB-13 are the subject of a valid claim of legal professional privilege.
80. [80]
    As against this, it was submitted on behalf of the defendant that ASIC’s claim to privilege has not been made out for essentially four reasons: (1) ASIC did not discharge its onus of proof in relation to the claim; (2) the task of preparing the draft statements was carried out by Mr Bastianon and Mr Paleologos for the dominant purpose of investigation rather than litigation; (3) Mr Bastianon and Mr Paleologos were drafting in their capacity as investigators rather than independent lawyers; and (4) there is an imputed waiver of the privilege because the continuation of criminal proceedings is inconsistent with maintenance of the claim.
81. [81]
    For reasons given above, I do not accept items (1), (2) and (3) in paragraph [80] have been made out.
82. [82]
    As to item (4) in paragraph [80], it was submitted there has been an imputed waiver of privilege. The submission is founded on two propositions,^[93] first, that the draft witness statements identified in MB-13 are disclosable; and second, that the continuation of criminal proceedings is inconsistent with the maintenance of the claim to privilege.^[94]
83. [83]
    I accept the first proposition is correct.
84. [84]
    As to the second proposition, it assumes there is a tension between a Prosecutor’s duty to disclose and a claim made for legal professional privilege.
85. [85]
    How is this tension resolved?
86. [86]
    It is submitted on behalf of the defendant it is resolved in favour of disclosure; the duty of disclosure is said to prevail over legal professional privilege resulting in an imputed waiver. In support of this, paragraph [74] of R v Bunting was cited, which states:

“In my opinion, consistently with the principle identified in Mann v Carnell, at the point when the duty of disclosure requires disclosure of relevant information, if disclosure of the relevant information requires disclosure of a privileged communication, the conduct of the Director instituting or maintaining a prosecution becomes inconsistent with the maintenance of the confidentiality of the communication by reason of legal professional privilege. In those circumstances, in my view it would be unfair for the Director to maintain the privilege in respect of the communication. Waiver of privilege is, therefore, imputed. In that sense the duty of disclosure “prevails” over legal professional privilege.”

87. [87]
    I have difficulty accepting Bunting should be applied here having regard to Mann v Carnell (1999) 201 CLR 1 and Director of Public Prosecutions (Cth) v Kinghorn (2020) 102 NSWLR 72.
88. [88]
    In Mann v Carnell, waiver of legal professional privilege was considered by the High Court. The majority, comprising Gleeson CJ, Gaudron, Gummow and Callinan JJ, at paragraph [29] said:

“Waiver may be express or implied.  Disputes as to implied waiver usually arise from the need to decide whether particular conduct is inconsistent with the maintenance of the confidentiality which the privilege is intended to protect.  When an affirmative answer is given to such a question, it is sometimes said that waiver is "imputed by operation of law".  This means that the law recognises the inconsistency and determines its consequences, even though such consequences may not reflect the subjective intention of the party who has lost the privilege…”

89. [89]
    As to ‘what brings about the waiver’, the majority also said at paragraph [29]:

“What brings about the waiver is the inconsistency, which the courts, where necessary informed by considerations of fairness, perceive, between the conduct of the client and maintenance of the confidentiality; not some overriding principle of fairness operating at large.” (emphasis added)

90. [90]
    Mann v Carnell calls for a particular question to be addressed in relation to waiver: Is the conduct of the holder of the privilege inconsistent with the maintenance of the privilege? The question is resolved having regard to considerations of ‘fairness’, but in a limited way. It informs whether there is inconsistency between the conduct of the privilege holder and the maintenance of the privilege.  Mann v Carnell confirms inconsistency is not informed by some ‘overriding principle of fairness operating at large’.
91. [91]
    In Bunting, it is clear ‘fairness’ in the context of a criminal trial underpinned the reasoning at paragraph [74]. The extent to which it did so is reflected at paragraph [76], where it was said:

“The conclusion that I have reached gives effect to the compelling reasons founded in the interests of the proper and fair administration of justice why, in the sense I have discussed, the duty to disclose relevant information to an accused charged with a criminal offence should “prevail” over legal professional privilege. The public interest in a fair trial and in ensuring that no innocent person is convicted of a crime is very powerful. That public interest is served by imputing waiver when the duty of disclosure exists.”

92. [92]
    With respect, the above reasoning suggests that inconsistency may be determined by reference to a general notion of fairness to the accused in a criminal proceeding, and a prosecutor’s duty to disclose. This is not, in my view, supported by Mann v Carnell, particularly the last sentence of paragraph [29].
93. [93]
    In this context, I have considered a recent decision of the New South Wales Court of Appeal in Kinghorn. There, the Court, comprising Bathurst CJ, Fullerton and Beech-Jones JJ held that Bunting does not represent a correct statement of principle.^[95] Particular passages of the judgment are, in my view, of note and provide a further reason to conclude that Bunting ought not be followed.
94. [94]
    In the context of dealing with imputed waiver and a prosecutor’s duty to disclose, the Court rejected the proposition that the notion of fairness referred to in Mann v Carnell captured a generally stated duty to disclose. At paragraph [155] the Court said:

“…Even though, as a prosecutor, the CDPP was subject to a prosecutorial duty of disclosure as an aspect of seeking to ensure the fairness of the trial, that circumstance was only a species of “some overriding principle of fairness operating at large” (Mann v Carnell at [29]); it was not a matter of itself which was shown to have informed any inconsistency.”

95. [95]
    With particular reference to paragraph [76] of Bunting, the Court did not accept that the matters of public interest referred to had application to the doctrine of imputed waiver. At paragraph [171] the Court said:^[96]

“With respect to his Honour, all of the important principles identified in this passage are instances of an “overriding principle of fairness”, none of which have any application to the doctrine of imputed waiver: Mann v Carnell. His Honour’s approach involves the deployment of the principles concerning imputed waiver to achieve a purpose they were not designed for….Ultimately, the doctrine appears to be directed to limiting the scope of the privilege, in that a “holder of the privilege should not be able to abuse it by using it to create an inaccurate perception of [a] protected communication”…; that is avoiding “forensic unfairness” referred to by Allsop J in DSE. Whatever its precise rationale, imputed waiver of privilege is not a means of serving a wider public interest in ensuring a fair trial (or hearing), beyond enabling disclosure of otherwise privileged material when the relevant form of inconsistency is demonstrated.”

96. [96]
    Both Mann and Kinghorn identify the critical matter for examination as ‘inconsistency’. That is, whether the conduct of the privilege holder is inconsistent with the maintenance of the privilege.
97. [97]
    What conduct does the defendant attribute to ASIC to suggest there is inconsistency with the maintenance of legal professional privilege?
98. [98]
    This is answered by reference to the written and oral submissions made on behalf of the defendant. The issue of imputed waiver is addressed at paragraphs 51 to 58 of the Defendant’s outline of submissions. The matters set out therein were developed in a limited way by Mr Clelland QC during his oral submissions.^[97]
99. [99]
    Save for pointing to the tension identified at paragraph [84] above, the Defendant’s outline of submissions do not identify any particular aspect of ASIC’s conduct as giving rise to inconsistency with the privilege.
100. [100]
     ‘Inconsistent conduct’ was identified by Mr Clelland QC in his oral submissions. The conduct to which he referred involves ASIC’s decision to maintain privilege in circumstances where there is a paucity of notes relating to extensive dealings between Mr Bastianon, Mr Paleologos and key witnesses. The significance of this point to the defence case is difficult to appreciate without some context.
101. [101]
     As I have already discussed above, an attack on the credit of key witnesses along with the ASIC investigation/investigators lies at the heart of the defence case. Bound up in the attack is a focus on the way in which witness accounts developed from versions given in compulsory examinations to those contained in final statements. It is said there are differences between versions given in compulsory examinations in comparison to final statements. The defence contend this is not explained on the face of the statements. Nor is it explained by notes kept by the investigators.
102. [102]
     Whilst I have some reservations about the manner in which witness statements evolved and the paucity of notes kept by investigators, neither matter establishes inconsistency with the maintenance of the privilege. Rather, the evidence suggests ASIC has conducted itself consistently with the privilege.
103. [103]
     The evidence establishes that the draft witness statements in MB-13 have not been shown to, or adopted by, witnesses.  They are a series of working drafts created by lawyers, to be discussed amongst lawyers. The content of those drafts have not been disclosed by ASIC, Mr Bastianon, or Mr Paleologos in evidence. Further, the content of the draft statements is not relied upon (expressly or by implication) in the prosecution case. Indeed, the existence of the draft statements is irrelevant to the Crown case. In this sense, it is difficult to see how any ‘forensic unfairness’^[98] would arise in maintaining the privilege, or ‘create an inaccurate perception of the protected communication’.^[99]
104. [104]
     As a consequence, I do not accept there has been imputed waiver of the privilege claimed in relation to the draft witness statements in MB-13.
105. [105]
     For the above reasons, I am satisfied it is appropriate the subpoena compelling production of draft witness statements be narrowed to exclude the documents identified in MB-13.

MB-14

106. [106]
     MB-14 identifies 13 draft statements for three witnesses.
107. [107]
     Items 1, 2 and 3 of MB-14 are draft witness statements prepared by Ms Emma Farnsworth. She is a member of ASIC’s Forensic Accounting Services team and prepared a statement at the request of Mr Bastianon and Mr Paleologos.^[100] There is no evidence to suggest Ms Farnsworth drafted a witness statement in the capacity of a lawyer.  The evidence does however establish Mr Bastianon and Mr Paleologos reviewed the draft/s.^[101]
108. [108]
     The notes redacted in Ms Farnsworth’s statement are linked to text within the body of the document. The link does little to inform the reader as to the nature of the redacted note. It is necessary to turn to other evidence to ascertain this.
109. [109]
     The redactions were described by Mr Bastianon in this way:^[102]

“…The redacted portions of Ms Farnsworth’s statements are communications between Ms Farnsworth and me, in my capacity as a lawyer for ASIC, or between Ms Farnsworth and Mr Paleologos.”

110. [110]
     Mr Paleologos described the redacted portions of the statements as follows:^[103]

“The redacted portions of Ms Farnsworth’s statements are communications between Ms Farnsworth and me, in my capacity as an investigator and lawyer for ASIC, or between Ms Farnsworth and Mr Bastianon.”

111. [111]
     The ‘communications’ referred to by Mr Bastianon and Mr Paleologos are said to contain either:^[104]

     1. confidential legal advice provided in the course of the preparation of the draft witness statement; or
     2. information which was provided in connection with, and for the dominant purpose of, commencing a prosecution against the defendant.
112. [112]
     To sustain a claim of privilege, the claimant must not merely assert it; but prove the facts that establish it is properly made.^[105] The evidence in relation to the claim of privilege for the Farnsworth statements falls short of this mark.
113. [113]
     First, in the context where draft statements were prepared by the witness, and not Mr Bastianon or Mr Paleologos, the evidence does not permit the Court to identify: (1) the author of each redacted note; (2) the nature of each redacted note; and (3) why each redacted note is ‘confidential’.
114. [114]
     Second, the evidence of Mr Bastianon and Mr Paleologos in relation to this issue constitutes a series of assertions that are unable to be tested by the Court. This is insufficient. It is not remedied having regard to the nature of the document and the circumstances in which it was created, being a draft witness statement prepared by the witness for a lawyer’s review. Nor is it remedied by examining each redaction in its context within the document. The context provided by the highlighted portion of each statement relevant to each redaction does not permit items (1) to (3) in paragraph [113] to be resolved in a manner consistent with the claim for privilege.
115. [115]
     Third, to uphold the claim, the Court needs to be satisfied the communication between the witness and Mr Bastianon or Mr Paleologos is confidential. The evidence, which comprises assertions, does not permit this to be examined, or tested.
116. [116]
     As a consequence, the claim for privilege has not been made out in relation to the redacted parts of Ms Farnsworth’s statements.
117. [117]
     Items 4 to 11 inclusive of MB-14 are draft supplementary statements of Mr Paleologos. The authors of the drafts are said to be Mr Bastianon and Mr Paleologos. Like Ms Farnsworth’s draft statements, a review of the documents reveals ‘notes’ in the margins of each of the statements have been redacted. The notes are linked to a highlighted passage within the body of the statement.
118. [118]
     As with Ms Farnsworth’s draft statements, the evidence does not permit the Court to identify in the case of items 4 to 11 of MB-14: (1) the author of each redacted note; (2) the nature of each redacted note; (3) why each redacted note is ‘confidential legal advice’, or provided in connection with reasonably anticipated litigation; and (4) why the note is ‘confidential’. This is because the evidence comprises assertions that are unable to be tested. This is not remedied by reviewing each redaction in its context within the document. More particularly, a review of the statement does not permit the Court to appreciate whether each redaction is a note made by Mr Paleologos as the witness, or a note made by him, or Mr Bastianon, as a lawyer reviewing the witness statement.
119. [119]
     In saying this, I am cognisant the redacted notes were brought into existence in the period July 2017 to November 2017. At this time, Mr Bastianon and Mr Paleologos were preparing draft witness statements for inclusion in a brief to the CDPP. This task required them to consider issues of the kind discussed in paragraphs [50] to [52]. Notes made in the margin of Mr Paleologos’ statement during this period for this purpose could be for the dominant purpose of legal advice, or in relation to reasonably anticipated litigation. The absence of detailed evidence about the notes makes it difficult to determine which, if either, applies.
120. [120]
     In the circumstances, I am not satisfied a valid claim for privilege has been established in relation to items 4 to 11 of MB-14.
121. [121]
     Items 12 and 13 of MB-14 are draft versions of a statement prepared for Mr Elias. They were drafted by Mr Bastianon and Mr Paleologos and represent working drafts as at 10 March 2016. The drafts were not shown to Mr Elias.  The documents contain notes in the margin. The author of each note is Mr Paleologos. They were made by him, on the draft statement, during a conference with Mr Elias.^[106] Privilege is claimed in respect of the redacted notes on the statement.
122. [122]
     An examination of the claim needs to take into account a number of contextual matters. They are: (1) the Elias statement, as at March 2016, was a draft document evolving between Mr Bastianon and Mr Paleologos; (2) Mr Elias was not shown the documents; (3) Mr Paleologos and Mr Bastianon were, for reasons I have already traversed, bringing their legal skills to bear in drafting statements in the absence of witnesses, which were for the dominant purpose of use in relation to reasonably anticipated litigation. In this context, the question is whether the redacted notes contain confidential legal advice, or contain confidential information provided for the dominant purpose of litigation.
123. [123]
     Having regard to Mr Paleologos’ affidavit, I am unable to determine whether the redacted notes contain legal advice. I am, however, prepared to accept, having regard to the contextual matters discussed above and paragraphs [50] to [52], that the notes are the subject of a valid claim of litigation privilege. For reasons given above, privilege was not waived by ASIC in the manner asserted by the defendant.
124. [124]
     In the circumstances, I am satisfied a valid partial claim for privilege has been established in relation to items 12 and 13 of MB-14.

Enforcement manual

125. [125]
     The second subpoena issued 26 March 2021 requires production of an ‘Enforcement Manual (as at 17 November 2015)’.
126. [126]
     ASIC contend the subpoena should be set aside. This is not without force. The enforcement manual is a lengthy document comprising 41 chapters and 2000 pages.  It deals with a number of topics, including the conduct of civil proceedings and the allocation of ASIC resources. It has no statutory force.
127. [127]
     It was fairly conceded on behalf of the defendant that much of the manual will be irrelevant to the issues in dispute in the proceeding.^[107]
128. [128]
     In circumstances where large parts of the document are irrelevant to the proceeding, it is my view the subpoena calling for the production of the entire enforcement manual is cast too broadly. The challenge to production of the enforcement manual should, as a consequence, succeed and the relevant part of the subpoena be set aside.
129. [129]
     This does not, however, mark the end of the issue.
130. [130]
     Mr Clelland QC submitted it was within the Court’s power to limit the subpoena to parts within the enforcement manual that are germane to the legitimate forensic purpose for production.^[108] In this regard, it was contended the subpoena could be narrowed to require production of those chapters of the document dealing with:^[109] (1) interactions with witnesses/prospective witnesses; (2) drafting witness statements; (3) creating/retaining records; and (4) when it is appropriate to use compulsory powers. Each of these matters are relevant to the defence case.^[110]
131. [131]
     The legitimate forensic purpose for the production of the enforcement manual was identified at paragraphs 10 to 11 of the Defendant’s written submissions, which are in the following terms (footnotes omitted):^[111]

“10. ….Ms Hutson faces, inter alia, 15 charges asserting that she gave false or misleading evidence at her own compulsory examinations pursuant to section 19 of the ASIC Act. A precondition to proof is the admissibility of the questions and answers relied upon. Fundamental to that is whether the examinations were lawful and, further, whether, even if technically lawful, the examinations were conducted in a proper and fair manner. The internal guidelines provided for in the Enforcement Manual as to when and how such examinations should be conducted are plainly material.

11. More broadly, it will be contended by defence at any trial and on pre-trial applications that the investigation in this matter overall was improper and unfair. The integrity of an investigation can be a significant and legitimate focus in a criminal case. Here, the evidence discloses that the investigators: ignored serious credibility issues of others in their pursuit of Ms Hutson; drafted and altered witness statements at times in the absence of witnesses (including based on what other witnesses said occurred); failed to make any or any sufficient records of interactions with witnesses; and destroyed some of their notes of their conversations with witnesses. This investigation was inconsistent with what is required in an accusatorial system of justice. It has resulted in unacceptable procedural fairness and evidentiary gaps which undermine the prosecution’s ability to prove the charges beyond reasonable doubt. The extent of the departures from the ASIC investigative guidelines is material to assessing the degree of unfairness and impropriety including whether it occurred deliberately or recklessly and at what level of seniority.”               (emphasis added)

132. [132]
     The legitimate forensic purpose for production relied upon by the defendant can, in my view, be reduced to the following: the enforcement manual is relevant to an attack on the ASIC investigation as it will inform:

     1. when and how compulsory examinations will be conducted; and
     2. the degree to which the investigation of the defendant was unfair or improper.
133. [133]
     With respect to (a), the defendant established the enforcement manual deals with compulsory examinations and was consulted by Mr Bastianon and Mr Paleologos in relation to this topic. Relevant evidence was elicited during the Committal.
134. [134]
     Mr Bastianon and Mr Paleologos were cross-examined at the Committal about the enforcement manual. They both confirmed the enforcement manual includes information about notices given under s 19 of the Act for compulsory examinations.^[112] As to the nature of the information the document contains, Mr Paleologos conceded the enforcement manual:

     1. contains ‘guidelines or directives for the issuing of coercive notices such as section 19 notices’;^[113]
     2. provides ‘guidance of… what areas you need to consider before issuing’ a s 19 notice;^[114]
     3. ‘summarises the ASIC powers’ in relation to a s 19 notice;^[115] and
     4. provides guidance of how to draft, prepare and serve a s 19 notice.^[116]
135. [135]
     Mr Paleologos was probed as to what the enforcement manual ‘directs, or recommends’^[117] about a decision to issue a notice where it is intended ASIC will recommend criminal charges against the named recipient. The transcript reveals he initially could not recall. The topic was however traversed again later in the cross-examination by reference to ‘guidelines or protocols’ of ASIC. I infer this was intended to capture the enforcement manual. The relevant exchange was in the following terms:^[118]

“What do the guidelines or protocols say about conducting a section 19 examination with a person against whom…it is proposed to recommend criminal charges?---The guidelines say that we can basically examine somebody up until we decide to…refer…a brief of evidence. So if we’ve got some inquiries, we can still examine because maybe, you know, we might want to clarify some things and put it to that subject or to that person of interest.

Are you sure that that’s what the guidelines say?---…we can examine someone up until the stage…before we put a brief to the DPP.

Even if it is intended to recommend that that person be charged, the guidelines say it is proper to conduct a section 19 examination?---The guidelines say that if we’re…in the process of evidence-gathering, we can still conduct an examination.”

136. [136]
     In a different context, Mr Bastianon was asked whether it was appropriate to use the compulsory examination power when dealing with a person suspected of committing an offence. His response was to the effect that there was no reason why the power to examine could not be used in this way, and commonly occurred.^[119] The following interchange immediately followed after this response:

“…And that’s in accordance with whatever internal guidelines exist in relation to the use of the section 19 powers?--- That’s…in accordance with the Act.

No, I’m asking you, is it in accordance with whatever guidelines exist within ASIC for the use of those powers?---Well…yes, of course we comply with…advice…and guidelines that are provided to us to perform our work as investigators and lawyers.

…what are the guidelines within ASIC that deal with the decision to use section 19 powers…?---

…We have an internal operation manual that talks about the use of section 19 powers.”

137. [137]
     The final matter to observe in relation to the evidence at the Committal is that Mr Paleologos confirmed the ‘content, directions or recommendations’ of ASIC’s enforcement manual were considered ‘partly’ in relation to the decision to issue the s 19 notice.^[120] The matter was the subject of discussion between him and Mr Bastianon.^[121] As is clear from Mr Bastianon’s evidence in the above cited exchange, he was of the view that the decision to examine the defendant complied with the relevant part of the enforcement manual.
138. [138]
     With this background in mind, the following question can be asked: is there a legitimate forensic purpose for production of that part of the enforcement manual dealing with s 19 notices?
139. [139]
     This question is resolved in the affirmative.
140. [140]
     The integrity of the ASIC investigation is an issue in dispute in the proceeding. One aspect of that issue focuses upon the decision to examine the defendant for the alleged purpose of filling gaps in ASIC’s case. In examining this issue, it is relevant the evidence establishes at this time that ASIC had guidelines dealing with this very decision in its enforcement manual. The evidence also suggests: (1) the investigators consulted the enforcement manual when making the decision; and (2) the senior investigator asserts they complied with the relevant guidance or directive given by the enforcement manual for this decision. The defence ought be entitled to test this by comparing the enforcement manual with the evidence as to asserted compliance. That cannot be done without the production of that part of the enforcement manual dealing with s 19 notices. Calling for the production of this part of the enforcement manual is, as a consequence, a legitimate forensic purpose.
141. [141]
     Whilst it is correct to say the evidence does not establish there has been non-compliance with the enforcement manual, I am still satisfied it is on the cards that the part of the enforcement manual dealing with s 19 notices would materially assist the defence case. This is because the decision by the investigators to consult the enforcement manual about s 19 of the Act gives rise to this question: In circumstances where it was not suggested it was routine practice to refer to the enforcement manual, what was it about this case, or the substance of the enforcement manual, that called for the investigators to consult the document? I infer, given the seniority and experience of the investigators, there is a feature of this case that called for examination of the enforcement manual in its application to s 19 notices. In this context, a view was then formed by the investigators about the requirements/directives of the enforcement manual, and whether compliance would be achieved. Given the very nature of the document (an internal guideline), issues of this kind are likely to be matters about which reasonable minds may differ. Adopting a flexible and liberal approach as the authorities suggest in a manner such as this, it is on the cards that one reasonable view of the facts, and the terms of the enforcement manual, is consistent with the defence case.
142. [142]
     With respect to (b) in paragraph [132], I can accept, given the defence case, the enforcement manual is relevant to an attack on the integrity of the ASIC investigation. It is, for reasons given above, relevant to the s 19 examination. It is also relevant to the manner in which ASIC officers prepared witness statements. In this respect, Mr Paleologos said the enforcement manual ‘talks about…witness statements that will be produced in [an] investigation’.^[122] He also confirmed the enforcement manual contains directives about:^[123] (1) dealing with witnesses; and (2) how to take witness statements. These topics are relevant to the defence case.
143. [143]
     The difficulty for the defendant is that there is no suggestion Mr Bastianon and/or Mr Paleologos consulted the enforcement manual in relation to dealing with witnesses, drafting witness statements or record keeping. Further, there is no evidence to suggest Mr Bastianon and Mr Paleologos departed from the enforcement manual in relation to these same matters. As Mr Del Villar QC and Ms McGree submitted, any alleged impropriety by reference to the enforcement manual at this stage is a ‘bare assertion without substance’.^[124] It does not, however, follow there is no legitimate forensic purpose for production of that part of the enforcement manual providing directives with respect to dealing with witnesses, draft witness statements and record keeping.
144. [144]
     The circumstances of this case, in particular those with respect to the evolution of witness statements and the paucity of notes are, in my view, a feature that seems unorthodox and, unsurprisingly, a matter of focus for the defence. It is a legitimate forensic purpose to call for the production of the enforcement manual to compare the investigative process with internal guidelines or directives. The difficulty is determining whether that comparison will materially assist the defence case.
145. [145]
     In this regard, it was submitted on behalf of the defendant that the comparison will reveal whether investigators complied with investigative processes, or they did not.^[125] It is further submitted either scenario would materially assist the defendant because:

     1. if investigators did not comply with the enforcement manual, any unfair or improper practices may be readily characterised as deliberate or reckless, which is relevant to legal arguments (such as for a permanent stay or exclusion of evidence) and the jury’s consideration of the investigation as a whole;^[126] or alternatively
     2. if investigators complied with the enforcement manual, ASIC via its enforcement manual, is, as a consequence, to be taken to direct officers to destroy records or interact with pivotal witnesses without keeping records of that contact; or compulsorily examine a person even after ASIC has formed a view that they ought be prosecuted. Individually and collectively, these matters indicate unfairness and impropriety at the highest level, which is of relevance to legal arguments and the jury’s consideration of arguments put before them about gaps in proof and fair conduct.^[127]
146. [146]
     Whilst I have some misgivings about the extent to which non-compliance with the enforcement manual may inform a stay or decision to exclude evidence, I accept that it is on the cards the document, irrespective of what it says, may be deployed to facilitate the erosion of the ASIC investigation/investigators credit. This is a matter of relevance to the jury’s consideration about the investigation and credibility of witnesses. Adopting a flexible and liberal approach leads me to conclude that it is on the cards that production of those parts of the enforcement manual providing directives with respect to dealing with witnesses; drafting witness statements and record keeping would materially assist the defence case.
147. [147]
     ASIC object to the production of the enforcement manual on three bases: (1) there is no legitimate forensic purpose for the production of the entire manual; or in the alternative, (2) it is subject to a valid claim for public interest immunity; or in the alternative, (3) it is subject, in part, to a valid claim of legal professional privilege, which has not been waived.
148. [148]
     For reasons given above, I do not accept item (1) in so far as it relates to the specific parts of the enforcement manual dealt with above.
149. [149]
     Turning to item (2), namely the public interest immunity claim, there was no dispute between the parties as to the relevant principles to be applied. Counsel for ASIC and the defendant both referred to a three-step process.^[128] Citing Gibbs CJ in Alister & Ors v The Queen (1984) 154 CLR 404, it was submitted the Court is to consider the following matters:

     1. Whether harm would be done by the production of the enforcement manual, that is, would harm be done to the public interest?
     2. Whether the administration of justice would be frustrated or impaired if the enforcement manual was withheld, that is, does the enforcement manual contain material evidence?;
     3. Where (b) is resolved in the affirmative, which of (a) or (b) predominates? (the balancing exercise)
150. [150]
     The onus of proving harm to the public interest lies with ASIC. To discharge the onus, ASIC rely upon two affidavits of Mr Caridi. One affidavit is read on an open basis. The second affidavit is confidential. There was an objection to the confidential affidavit by the defendant. The objection, in my view, is not sound. It is well established a Court may receive affidavits of this kind in support of a public interest immunity claim.^[129]
151. [151]
     Mr Caridi’s open affidavit establishes a strong foundation for the submission there is potential harm to the public interest, but, for obvious reasons, has its limitations in terms of detail. As a consequence, I reviewed his confidential affidavit. Having the benefit of both affidavits, I am satisfied there is a real risk that disclosure of the enforcement manual, as a whole, or on a limited basis,^[130] would be injurious to the public interest.
152. [152]
     The material establishes that Mr Caridi has been employed with ASIC for about twenty years and conducted numerous investigations that have led to the commencement and prosecution of criminal proceedings. His opinion assessing harm to the public interest, when viewed in the light of his seniority and experience, ought attract significant weight.^[131] It can be observed there is no evidentiary basis to adopt an alternative course.
153. [153]
     The evidence persuades me that ASIC’s ability to take timely and effective action to detect, prevent and deter misconduct from those in the corporate and financial services industry engaging in misconduct would be impaired in the event the enforcement manual was disclosed, be it in whole or part. Those engaging in misconduct could use their knowledge of the enforcement manual to:^[132]

     1. evade detection;
     2. structure activities in a manner that prevents ASIC dealing with misconduct; and/or
     3. take steps to impede, or avoid, investigation.
154. [154]
     Irrespective of which outcome applies, be it (a), (b), or (c) above, ASIC enforcement action would be jeopardised if the enforcement manual was disclosed as required by the subpoena, or on a more limited basis.
155. [155]
     As against this, it is submitted on behalf of the defendant that the enforcement manual is ‘material’, thereby establishing a public interest in disclosure.^[133] The submission is founded on the proposition that the enforcement manual would materially assist the defence case.^[134]  For reasons given above, I do not accept this has been established for the entire enforcement manual, but it has been established for limited parts of the document. The ‘balancing exercise’ referred to above therefore only arises in the context of limited disclosure.
156. [156]
     Where does the balance lie?
157. [157]
     The balance, in my view, is finely balanced.
158. [158]
     The public interest in ensuring ASIC investigations are not impeded is obvious enough. It is a matter to which considerable weight should attach.
159. [159]
     As against this, to refuse production of the enforcement manual on the basis of public harm would rightly leave the defendant aggrieved. Absent the document, she will not be able to fully test the fairness of the ASIC investigation by reference to its internal directives and guidelines, some of which were consulted during the investigation. The constraint on her ability to test the investigation in this way is a matter to which significant weight should also attract. It is a matter that lies at the heart of her defence.
160. [160]
     Overall, the balance favours upholding the public interest immunity claim. This is because: (1) it cannot fairly be said that the enforcement manual is a document upon which the innocence of the defendant might depend, or is necessary to avoid a miscarriage of justice;^[135] (2) the enforcement manual does not have statutory force; (3) the process by which witness statements were prepared and witness versions evolved is a matter that can be tested at trial without the enforcement manual; (4) withholding the enforcement manual from production does not preclude the defendant from attacking evidentiary gaps in the investigation or processes adopted by Mr Bastianon and Mr Paleologos; (5) withholding the enforcement manual from production does not preclude the defendant from attacking the credit of key witnesses relied upon by the Crown to prove the elements of each offence; and (6) upholding the claim for public interest immunity does not, in my view, preclude the defendant from drawing the jury’s attention to the existence of the document and that ASIC have declined to produce it.
161. [161]
     For these reasons, the claim to public interest immunity prevails. Production of the enforcement manual, be it in whole, or part, is fairly resisted on this basis. The subpoena compelling production of the document will be narrowed accordingly.
162. [162]
     With respect to item (3) in paragraph [147], it is unnecessary to dwell upon legal professional privilege in light of what I have said above. For completeness, I will however provide some brief observations in relation to the point.
163. [163]
     ASIC claims privilege in respect to chapters 1, 5-13, 17, 19-23, 25, 28-37, 39 and 41 of the enforcement manual. The evidence relied upon to establish privilege is principally that of Mr Bastianon. His evidence establishes that: (1) the document bears a specific note identifying it as ‘confidential’;^[136] (2) chapters over which privilege is claimed have been drafted, and where necessary, updated, by Australian lawyers within ASIC;^[137] and (3) the chapters over which privilege is claimed have been drafted by legal officers within ASIC for the dominant, if not sole, purpose of providing legal advice.^[138]
164. [164]
     Mr Bastianon’s evidence in relation to the dominant purpose of the document is a conclusionary assertion. It is an onerous, if not oppressive, task to try and test this assertion given the size of the enforcement manual, and the range of topics it traverses. As a consequence, the evidence, in my view, was insufficient to determine the claim. This is so even when the conclusionary assertion is coupled with the very nature of the document, which is ‘confidential’.  
165. [165]
     To resolve the matter, the Court would need to call for the enforcement manual and undertake its own review of those parts the subject of the privilege claim. I was not persuaded to undertake this onerous and oppressive task. This was particularly so given I have found, for other reasons, that the subpoena should be narrowed to exclude production of the enforcement manual in its entirety.

Disposition of the application

166. [166]
     For the reasons given above, I invite the parties to prepare minutes of orders.
167. [167]
     In general terms, those orders should reflect the following:

     1. the application to set aside the subpoena requiring production of the attendance records is dismissed;
     2. the subpoena requiring production of draft witness statements is narrowed to exclude:
        1. the draft witness statements identified in exhibit MB-13 to Mr Bastianon’s affidavit;
        2. the redacted notes on the draft witness statements that are items 12 and 13 in exhibit MB-14 to Mr Bastianon’s affidavit;
     3. the application to exclude from production the draft witness statements that are items 1 to 11 in exhibit MB-14 to Mr Bastianon’s affidavit is dismissed; and
     4. the subpoena dated 26 March 2021 be narrowed to exclude production of the enforcement manual.
168. [168]
     For completeness, I note ASIC’s application seeks an order as to costs.
169. [169]
     I decline to make this order. This is to reflect that the parties have each enjoyed a measure of success. It is also intended to reflect, as these reasons reveal, it was not unreasonable for the defendant to seek production of the documents the subject of the application; there was a legitimate forensic purpose for doing so. This purpose was defeated by privilege claims rather than a finding that the call for production was tantamount to a fishing expedition. I will therefore order that each party bear their own costs. An order to this effect should form part of the minutes of orders.