Does "adverse material" in Section 162(3) of Independent Broad-based Anti-corruption Commission Act 2011 (Vic) refer to proposed adverse comments or opinions in report, or evidentiary material upon which proposed adverse comments or opinions are based?

AB (a pseudonym) v Independent Broad-based Anti-corruption Commission [2024] HCA 10 (13 March 2024)

Intro:-

This is an appeal from the Supreme Court of Victoria.

Facts:-

Between 2019 and 2021, IBAC conducted an investigation into allegations of unauthorised access to, and disclosure of, internal email accounts of a "public body" within the meaning of s 6(1) of the IBAC Act.

The second appellant, CD, is a registered organisation under the Fair Work (Registered Organisations) Act 2009 (Cth). The first appellant, AB, is a senior officer of CD and an employee of the public body. During the investigation, AB gave evidence to IBAC in a private examination.

On 6 December 2021, IBAC provided AB with a redacted version of its draft special report prepared under Pt 7 of the IBAC Act and requested his response by 20 December 2021 ("the Draft Report"). Part 4 of the Draft Report contained proposed findings adverse to AB (and others) in relation to the unauthorised access and disclosure of information and reasons for those findings. Part 5 of the Draft Report contained proposed findings adverse to the appellants (and others) in relation to the workplace culture of the public body and reasons for those findings.

On 12 December 2021, AB's solicitor replied to IBAC seeking an extension of time in which to respond, the transcript of his examination, transcripts of the examinations of other witnesses referred to in the Draft Report and copies of other documentary material relied upon to support the proposed adverse findings. On 14 December 2021, IBAC agreed to the extension of time and provided the transcript of AB's examination as well as copies of the documents shown to him during his examination. However, IBAC did not agree to provide the transcripts of the other witness examinations or the other requested documents.

Issues:-

Does "adverse material" referred to in s 162(3) refer to the proposed adverse comments or opinions in the special report or whether it is the evidentiary material upon which those proposed adverse comments or opinions are based?

Will the obligation to provide adverse material be satisfied by the provision of the substance or gravamen of the underlying material rather than the underlying material itself?

Consideration:-

The IBAC Act

The objects of the IBAC Act and the functions of IBAC include the identification, investigation and exposure of corrupt conduct, assisting in the prevention of such conduct and assisting in improving the capacity of the public sector to prevent such conduct. The definition of "corrupt conduct" is extensive, but it suffices to state that it includes conduct of a public officer or public body that constitutes the dishonest performance of their functions or conduct of any person that adversely affects the honest performance of those functions, provided that such conduct constitutes a "relevant offence" (which includes any indictable offence committed against an Act). IBAC's functions also include reporting on, and making recommendations as a result of, the performance of its duties and functions.

Section 162(2)-(4) provide:

"(2) If the IBAC intends to include in a report under this section adverse findings about a public body, the IBAC must give the relevant principal officer of that public body an opportunity to respond to the adverse material and fairly set out each element of the response in its report.

(3) If the IBAC intends to include in a report under this section a comment or an opinion which is adverse to any person, the IBAC must first provide the person a reasonable opportunity to respond to the adverse material and fairly set out each element of the response in its report.

(4) If the IBAC intends to include in a report under this section a comment or an opinion about any person which is not adverse to the person, the IBAC must first provide that person with the relevant material in relation to which the IBAC intends to name that person." (emphasis added).

Adverse material and s 162(3)

The interpretation of s 162(3) of the IBAC Act must "begin with a consideration of the text itself", that is, the text of the statute as a whole. That said, ascertaining the meaning of the text requires a consideration of its context, which includes the general purpose and policy of a provision and, in particular, the mischief it is seeking to remedy.[38] Neither the Court of Appeal nor any of the parties suggested that the extrinsic materials or legislative history of s 162 were of assistance in resolving the construction issue raised in this case.

The obligation imposed by s 162(2) is engaged where IBAC intends to include in a special report an "adverse finding" about a public body, whereas the obligation imposed by s 162(3) is engaged where IBAC intends to include in a special report a "comment or ... opinion which is adverse to any person". The words "finding", "comment" and "opinion" are not defined in the IBAC Act. It is unnecessary to explore whether there is any substantial difference between those words in this context, as there is no doubt that each of them at least includes a conclusion that a person has engaged in "corrupt conduct". If it were otherwise, the protections afforded by s 162(2) and (3) would be illusory. The potential damage to the interests, including the reputation, of a public body, public officer or other person from the publication of a special report containing a conclusion that they engaged in corrupt conduct is manifest.

Section 162(4) provides little assistance in construing s 162(2) and (3). Where IBAC intends to include in a special report a comment or opinion about a person that is not adverse to them, it is obliged to provide that person with the "relevant material" in relation to which IBAC intends to name them. Section 162(4) does not afford that person an opportunity to respond to that material, much less require the inclusion of a response in any draft report.

With both s 162(2) and (3), the opportunity (or reasonable opportunity) IBAC must afford is to respond to the "adverse material". The text of those provisions suggests that "adverse material" is something different from the "adverse findings" and the "comment or ... opinion which is adverse". Parliament could have provided that the opportunities afforded by s 162(2) and (3) respectively are to respond to the proposed "adverse findings" and the "comment or ... opinion which is adverse", but it chose not to. Instead, the undefined phrase "adverse material" was utilised.

In construing that phrase, it is important to begin by identifying some basic propositions about the applicable common law principles of natural justice where a person's interests are likely to be affected by an exercise of power. First, such a person "must be given an opportunity to deal with relevant matters adverse to [their] interests which the repository of the power proposes to take into account in deciding upon its exercise". Second, the person whose interests are likely to be affected does not have to be given an opportunity to comment on every adverse piece of information, irrespective of its credibility, relevance or significance. However, "in the ordinary case where no problem of confidentiality arises an opportunity should be given to deal with adverse information that is credible, relevant and significant to the decision to be made". At least in some contexts, the affected person must be given the opportunity to respond to such information obtained from third parties even if it was not expressly relied on, or proposed to be relied on, by the decision-maker.

Conclusion:-

It follows that the appellants' sole ground of appeal should be upheld. The Court of Appeal erred in construing the phrase "adverse material" in s 162(3) of the IBAC Act. That phrase refers to the evidentiary material said by IBAC to justify a "comment or ... opinion which is adverse to any person". In most cases, including this one, it would be expected that a reasonable opportunity to respond to that evidentiary material will be afforded by proffering a reasonable opportunity to respond to the substance or gravamen of that material, which will usually involve a full account of its essential content. In some cases, more may be required where the provision of the substance or gravamen of the material is not sufficient to discharge IBAC's obligation under s 162(3).