Obtaining transcripts of section 155 examinations and the "implied undertaking"

The ACCC is at an advantage to private litigants, when bringing proceedings under the Competition and Consumer Act 2010 (Cth) (Act), due to its coercive information gathering powers.  One such power is the authority granted by s 155(1)(c) of the Act to summon a person before the ACCC to be examined on oath.  Although court rules allow private litigants to examine people before trial in some circumstances, the scope for a private litigant to do so is far more limited than that provided to the ACCC by s 155.  For this reason, the transcript of an examination conducted under s 155 in relation to a suspected contravention of the Act is a valuable thing to a private litigant contemplating or conducting proceedings relating to the suspected contravention. 

A private litigant may seek to obtain a s 155 transcript from the ACCC or a person to whom the ACCC has given a copy of the transcript.  The latter scenario was considered in the recent decision of Boral Resources (Vic) Pty Ltd v CFMEU^[1] (Boral v CFMEU).  This article will examine the issues which may arise in each scenario with a particular focus on Boral v CFMEU.

Obtaining a s 155 transcript from the ACCC

A private litigant may seek a s 155 transcript from the ACCC through compulsory court processes such as subpoenas, third party discovery or preliminary discovery.^[2]  However, s 155AAA of the Act may prevent the ACCC from disclosing the transcript in certain circumstances.^[3]   

Section 155AAA prohibits the disclosure of "protected information" by a "Commission official"^[4] except in the circumstances referred to in the section.  A s 155 transcript constitutes "protected information".^[5]  Sub-sections 155AAA(1)(a) and (1)(b) provide two circumstances, but not the only circumstances, where disclosure is allowed under s 155AAA.  These are:

• disclosure occurring when a “Commission official is performing duties or functions as a Commission official”: sub-s (1)(a); and
• disclosure that is required or permitted by the Act, “any other law of the Commonwealth” or a prescribed law of a State or internal Territory: sub-s (1)(b).

Turning first to sub-s (1)(b), there are presently no prescribed laws of a State or internal Territory, so one must ask whether a subpoena or discovery order is a "law of the Commonwealth".  A "law of the Commonwealth" is not defined in the Act.^[6]  It is likely that a subpoena or discovery order is a "law of the Commonwealth" if it is issued or made by a Commonwealth Court, rather than a State or Territory court.    It is submitted that the rules of the Federal Court of Australia and Federal Circuit Court of Australia pertaining to subpoenas and discovery are "laws of the Commonwealth", but not the equivalent rules of a State or Territory court.  The rules of the Federal Court of Australia and Federal Circuit Court of Australia are made pursuant to Commonwealth legislation^[7] and are enforced by courts established by Commonwealth legislation.  By contrast, the equivalent rules in a State or Territory court are made pursuant to State or Territory legislation and enforced by courts created under such legislation.   

For a private litigant involved in proceedings in a State or Territory court, sub-s (1)(a) may assist.  The question for sub-s (1)(a) is whether a "Commission official" would be performing one of their duties or functions when responding to a subpoena or discovery order of a State or Territory court.  The answer to this question is unclear and a detailed analysis is beyond the scope of this article.  For present purposes, it is suffice to note that sub-s (1)(b) appears to limit the ACCC's obligations to comply with a subpoena or discovery order to one issued or made by a Commonwealth Court.  Given this limitation, it seems unlikely that a "Commission official" would be performing their duties or functions by responding to an order that the ACCC is not required to respond to.^[8] 

Obtaining a s 155 transcript from a person other than the ACCC

The ACCC may have voluntarily provided a s 155 transcript to a person.  If so, that person is required to produce the transcript in response to a valid subpoena or discovery order, notwithstanding a confidentiality obligation.  However, the court that ordered discovery or issued the subpoena may consider it appropriate to create a confidentiality regime limiting the parties who may access the transcript.

If the ACCC has commenced proceedings following an investigation, it may have produced a s 155 transcript to the respondent under s 157 of the Act or pursuant to a discovery order.^[9]  In that case, a private litigant may consider subpoenaing the s 155 transcript from the respondent.  This, however, raises issues concerning the "implied undertaking" owed by the respondent. 

The implied undertaking (sometimes referred to as the "Harman" undertaking due to the famous case dealing with it^[10]) is an obligation owed by a litigant, who receives information from another party to the litigation where that other party was compelled to provide the information by a rule of the court, an order of the court or otherwise.  The recipient of the information is obliged not to use it for a purpose other than for which it was provided, unless they are given leave of the court.  The obligation arises by operation of law and is owed to the court, rather than the party who produced the information.  Hence, a breach of the obligation is a contempt of court.  The undertaking may apply to discovered documents, answers to interrogatories, subpoenaed documents and witness statements served pursuant to an order of the court, among other things.  The implied undertaking continues until the information is received into evidence.^[11] 

Boral v CFMEU

Boral sought damages from the CFMEU in the Supreme Court of Victoria for the tort of intimidation.  The intimidation related to industrial bans imposed by the CFMEU on concrete and other building products supplied by Boral to Victorian construction sites.  This proceeding only concerned the quantification of damages since Boral had obtained judgment in default of the CFMEU filing a defence. 

The ACCC had commenced proceedings against the CFMEU in the Federal Court for alleged breaches of the secondary boycott provisions of the Act.  The Federal Court proceeding was afoot at the time of the Supreme Court proceeding and there was a "substantial overlap or commonality" between them.^[12]  The CFMEU obtained copies of s 155 transcripts from the ACCC pursuant to an order of the Federal Court. 

Boral sought discovery of the s 155 transcripts from the CFMEU.  The reasons in Boral v CFMEU do not state why Boral sought discovery from the CFMEU rather than subpoenaing them from the ACCC or the individual examinees.  Perhaps Boral considered that the ACCC would not be required to respond to a subpoena issued by the Supreme Court of Victoria because it does not constitute a "law of the Commonwealth" for the purposes of s 155AAA(1)(b).  Perhaps the identity of each examinee was unknown.^[13]  Whatever the reason, Boral sought the transcripts from the CFMEU, which gave rise to a different issue: the implied undertaking owed by the CFMEU to the Federal Court.

The CFMEU contended before Bell J of the Supreme Court of Victoria that the implied undertaking owed by the CFMEU to the Federal Court deprived the Supreme Court of the power to order discovery of the s 155 transcripts.  Alternatively, the CFMEU contended that if the Supreme Court did have the power to order discovery, it should exercise its discretion not to do so.  Bell J granted the ACCC leave to intervene.  The ACCC did not dispute that the Supreme Court had the power to order discovery but contended that it should exercise its discretion not to order discovery.  Bell J rejected the submissions of the CFMEU and ACCC and ordered discovery of the transcripts.^[14]

Bell J acknowledged that the CFMEU was under an implied undertaking to the Federal Court not to use the transcripts for any purpose other than the Federal Court proceeding unless it had leave of the Federal Court.  However, this undertaking was subject to an exception, being that it "must yield to inconsistent statutory provisions and to the requirements of curial processes in other litigation, eg discovery and inspection".^[15]  Bell J said that in this case, the relevant curial processes were to be found in the rules of the Supreme Court of Victoria and provisions of the Civil Procedure Act 2010 (Vic) concerning discovery.  His Honour placed particular emphasis on s 55 of the Civil Procedure Act, which allows the Court to "make any order or give any directions in relation to discovery that it considers necessary or appropriate".  Bell J noted that this power must be exercised so as to give effect to the "overarching purpose" of the Civil Procedure Act, being the "just, efficient, timely and cost-effective resolution of the real issues in dispute".^[16] 

The CFMEU submitted that the Supreme Court could not (as opposed to should not) order discovery of the transcripts under s 55 of the Civil Procedure Act without the Federal Court first releasing the CFMEU from the implied undertaking.  Bell J rejected this argument saying that "it is clear from both authority and principle that the implied undertaking yields to the curial processes of courts other than the court to whom the undertaking is owed and that it is not necessary for the court directing discovery to first release the party from its undertaking before another court can exercise its curial powers to order discovery … in a separate proceeding."^[17]  Bell J cited several cases in support of this proposition including Schweppes Pty Ltd v Amcor Ltd where Gordon J held that the implied undertaking yields to a valid subpoena and other "valid compulsive processes of law".^[18]

Having concluded that the Supreme Court could order discovery of the transcripts, Bell J next considered whether he should order discovery as a matter of discretion.  The ACCC advanced two main propositions for why discovery should not be ordered: (i) the s 155 transcripts were private to the persons examined by the ACCC and (ii) the effective operation of the processes established by s 155 and the achievement of the purposes of the ACCC "might be inhibited by court-ordered release of transcripts in collateral private proceedings".^[19]  His Honour acknowledged that ordering discovery would "detract to some extent" from the privacy of the transcripts and the purpose for which they were obtained.^[20]  His Honour also acknowledged that in some cases a concern about impeding the flow of information to a regulatory agency may prevent an order for discovery, but this was not such a case.^[21]  In coming to this view, Bell J relied on the following:

• Examinations under s 155 "necessarily involve the potential for some disclosure because contravention proceedings … are always a possibility". ^[22]
• The discovery of the transcripts would only be for the Supreme Court proceeding.  Hence, they would "still enjoy a significant measure of confidentiality." ^[23]
• Boral would owe an undertaking to the Supreme Court to only use the transcripts for the Supreme Court proceeding.  It would not owe a separate undertaking to the Federal Court.^[24]
• Given the coercive nature of s 155 and the power of the Federal Court to compel witnesses to give evidence, ordering discovery would not significantly inhibit the ACCC's functions.^[25]
• There was no "real risk" of the flow of information to the ACCC or the effective conduct of contravention proceedings being compromised.^[26]
• The presence of personal information or commercially sensitive information in the transcripts was not a reason for refusing discovery as this could be addressed through a confidentiality regime.^[27]

His Honour placed particular emphasis on the "overarching purpose" of the Civil Procedure Act, which he considered "fundamental" to deciding how to exercise his discretion.^[28]  Bell J concluded that an order for discovery would give effect to the "overarching purpose" particularly because the transcripts were "likely to be so highly probative to the issue of Boral’s loss and damage that it would be unjust to deprive it of the targeted order of discovery that has been sought."^[29]

Although Bell J ordered discovery, he accepted that ordering discovery of transcripts may be generally unhelpful to the ACCC when conducting examinations under s 155 because it "might create discomfort on the part of interviewees about the actual confidentiality of the process".^[30]  Accordingly, his Honour said the Supreme Court should "not lightly make discovery and like orders in relation to documents covered by an implied undertaking in a contravention proceeding in the Federal Court."^[31]

Conclusion

It may not be possible to subpoena or obtain discovery of a s 155 transcript from the ACCC to use in a proceeding in a State or Territory court due to the exception in s 155AAA(1)(b) being limited to a "law of the Commonwealth".  This problem might be avoided by commencing proceedings in the Federal Court, but a litigant may not be able to invoke the jurisdiction of the Federal Court depending on its cause of action.  In such cases, the litigant may be able to seek s 155 transcripts, by way of subpoena or discovery, from a person who has been provided with them by the ACCC.  If the transcript has been provided to the person pursuant to a court rule or order of the court, they may be subject to the implied undertaking not to use it for any purpose other than the litigation in which it was provided.  If so, it is at the discretion of the court, which is ordering discovery or issuing the subpoena, whether to order the production of the transcript.  If the transcript was voluntarily provided by the ACCC to the person from whom production is sought, there is no issue concerning the implied undertaking and the person will be compelled to produce the transcript regardless of any confidentiality arrangement it may have with the ACCC.  Further, if the transcript has been received into evidence in the other proceeding, the implied undertaking no longer applies and no difficulty arises.

This article was originally published in (2015) 31(9&10) Competition and Consumer Law News 118.