Paciocco & Anor v Australia and New Zealand Banking Group Limited [2016] HCATrans 1 (12 January 2016)

Last Updated: 19 January 2016

[2016] HCATrans 001

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Melbourne No M219 of 2015

B e t w e e n -

LUCIO ROBERT PACIOCCO

First Appellant

SPEEDY DEVELOPMENT GROUP PTY LTD (ACN 006 835 383)

Second Appellant

and

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED (ACN 005 357 522)

Respondent

Office of the Registry
Melbourne No M220 of 2015

B e t w e e n -

LUCIO ROBERT PACIOCCO

First Appellant

SPEEDY DEVELOPMENT GROUP PTY LTD (ACN 006 835 383)

Second Appellant

and

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED (ACN 005 357 522)

Respondent

FRENCH CJ

TRANSCRIPT OF PROCEEDINGS

FROM PERTH BY VIDEO LINK TO MELBOURNE

ON TUESDAY, 12 JANUARY 2016, AT 10.00 AM

Copyright in the High Court of Australia

____________________

MR W.A.D. EDWARDS: May it please the Court, I appear for the appellants in the appeals, respondents on the summons. (instructed by Maurice Blackburn)

MS C. VAN PROCTOR: May it please the Court, I appear for Australia and New Zealand Banking Group Limited, the applicants in respect of both of the summonses. (instructed by Ashurst Australia)

HIS HONOUR: Yes, Ms Van Proctor.

MS VAN PROCTOR: Your Honour, the applications for ANZ seek orders in each of the appeals restricting access to certain materials that are presently on the High Court’s file, supported by an affidavit of Mr Tandora made on 21 December 2015. ANZ has the benefit of orders made by the trial judge which continue to apply but requires the further orders sought following the transfer of original exhibits from the Federal Court registry to the High Court so as to conduct the appeal while maintaining the confidentiality protection that is afforded by the existing orders. The proposed orders do differ in form from the orders that were made by the trial judge. The proposed orders are exhibited as MT-1 to Mr Tandora’s affidavit.

HIS HONOUR: Yes.

MS VAN PROCTOR: They propose to prevent access to unredacted documents which contain confidential information - that is order 4 – and to require ANZ to provide the Registry with copies of redacted confidential documents where those documents might potentially be relevant to the appeal – that is the intention of order 2 – and to permit inspection of the redacted documents, which is the intention of order 3. But the Court might consider it more appropriate to make orders simply in similar form to those made by the trial judge; those orders are annexed as exhibit MT-2 to Mr Tandora’s affidavit.

There are three orders I believe – four orders made by the trial judge, Justice Gordon, as she was then, all made on the same day and which have sought to be put into one proposed form of order in respect of exhibit MT-1. The orders proposed also differ in form from the orders made by the trial judge in this way. They do not expressly refer to Part XAA of the Judiciary Act. Her Honour’s orders at trial were made under the analogous provisions in the Federal Court Act.

That course was taken in this case because of the perhaps unusual situation that although the orders had been made under analogous provisions to Part XAA by the trial judge, in this appeal it is not anticipated that there will be any reference to the material at all and it was thought that the orders could therefore be made under the Court’s power to regulate proceedings having regard to section 77RB of the Judiciary Act.

However, the Court might consider the appropriate form of order is an order under section 77RE, expressed perhaps to be made until further order so that the matter can be revisited, if necessary, or if the Court has concerns about notification to news publishers an order might be made under section 77RH of the Judiciary Act on an interim basis perhaps until the hearing of the appeals so as to provide an opportunity to news publishers to appear at that time if the Court considered that course was required.

HIS HONOUR: Just before you go further, the joint appeal book, the full volume, so far as I can see by looking at the index, does not contain any of the exhibits which are the subject of the proposed order MT-1.

MS VAN PROCTOR: That is correct, your Honour, with one exception. The joint appeal book does include, as hopefully volume 2, the report of Mr Inglis; it is the late payment event report and it commences at page 429 of the appeal book.

HIS HONOUR: Yes, I have it.

MS VAN PROCTOR: Now, that report is the subject of proposed order 1(e).

HIS HONOUR: Which exhibit is it?

MS VAN PROCTOR: It is exhibit 27, and that is why it is proposed that ANZ provide a redacted version of the appeal book as well as the redacted version of that exhibit to the Registry to facilitate inspection of that document if required.

HIS HONOUR: The redacted version of the appeal book would not include that exhibit, is that right?

MS VAN PROCTOR: Your Honour, it would include the exhibit with redactions set out in the schedule to the proposed order, which commences on the following page behind the order, or page 11 of Mr Tandora’s affidavit.

HIS HONOUR: Yes, all right.

MS VAN PROCTOR: Now, all of these references reflect the orders that were made by the trial judge and redacted versions have been prepared. So it is that exhibit, your Honour, as well as a supplemental report and a reply report, exhibits 27 and 30 – sorry, exhibit 27 contains both the initial report and the supplemental report; exhibit 30 is a reply report, and that is referred to on page 18 of Mr Tandora’s affidavit, the same process is envisaged in respect of that document. Those are the only annexures, your Honour, that appear in the appeal book and it is not anticipated that there will be any reference to any of the parts of those reports that are intended to be redacted; they are very detailed supporting material.

HIS HONOUR: Now, I know very little about the reason for making the order that you seek and I have regard to section 77RD of the Judiciary Act. All I know is that orders were made previously in the Federal Court. Those orders were made two years ago. It may be, for example, that time has overtaken some of the concerns relating to the disclosure of some of those matters but there is nothing in the material before me to indicate why I should make the order that you seek, apart from the fact that it has been made before and that the Bank perceives these matters as being matters of a sensitive commercial character requiring their suppression or non-disclosure.

MS VAN PROCTOR: Yes, your Honour is correct in that Mr Tandora does refer only to the Bank’s concern about the commercial sensitivity and its risk of being divulged to competitors. Much of the information – I can summarise it for you at a high level and I can take you to some examples, your Honour, but it was envisaged that in circumstances where the orders had been made below and given the position taken by the respondents the position was taken not to - - -

HIS HONOUR: The position taken by the respondent is not unusual. It is not unusual for the respondent to have no interest in whether an order of this kind is made, so the respondent’s acquiescence, if you like, is neither here nor there. There is a public interest I mention which is obvious and, of course, made explicit in section 77RD.

MS VAN PROCTOR: The confidential information, your Honour, in summary is proprietary information of ANZ which comprises information as to - - -

HIS HONOUR: What does that mean? When you say “proprietary information”, what does that mean?

MS VAN PROCTOR: It is information about the practices and procedures of the Bank which is integral to its risk management processes and unique to the Bank and its businesses at a level of detail where its public disclosure carries a risk of use by a competitor in two ways: either by copying by a competitor or by obtaining a competitive advantage having information about the way in which ANZ calculates – having regard with knowledge of ANZ’s internal processes that would provide a competitor with a competitive advantage.

Now, having regard to what your Honour has said about the lack of information, ANZ would seek the opportunity to provide some supplementary evidence. It is simply that there are so many individual proposed redactions that that process was thought to be cumbersome, but certainly ANZ would seek the opportunity - - -

HIS HONOUR: Well, it is not only cumbersome. The number of matters you have identified makes it almost impossible to make a judgment. I mean, how do I know, for example, that some of these matters have not passed into the public domain? It would not be the first time that a claim for confidentiality has been made of matters in the public domain. Can you assure me that none of them are?

MS VAN PROCTOR: I cannot, your Honour. All I can say is that they relate largely to internal processes, such as the circumstances in which ANZ sets its shadow limits and undertakes other processes which are generally not in the public domain, which are restricted to internal business practices and do not become public over time.

Perhaps your Honour might take some comfort from the fact that most of the information relates to calculations for the 2009 year, but the passage of time does not alter the manner in which ANZ conducts its processes involving shadow limits and also what is known as score-carding, which is the way in which it perceives customer risks of default and how it provisions – and how it calculates its regulatory capital requirements having regard to that risk of default. These are not matters that over time come into the public domain, your Honour.

HIS HONOUR: I think to shorten the process now, what I think you will need to do, Ms Van Proctor, is to file an affidavit indicating the substantive basis upon which you say I should make the orders which are sought by reference to the nature of the materials in respect of which those orders are sought.

Now, the one you have taken me to, I think, is an expert report. Obviously there are expert opinions and then there are a number of references. Some of them, for example, may have referred to the particular patterns of customer behaviour, which I would not have thought was a matter of commercial sensitivity in how customers behave. On the other hand, it may be that the internal practices of the Bank in responding to or dealing with those things falls into a different category, but I need to be assured that there has been consideration given to the basis and that that basis is presented to me for making the order that you are seeking, having regard to requirements of the Judiciary Act and, even absent those requirements, the reluctance of the Court to make non-disclosure or non-publication orders in the exercise of its general power to regulate its proceeding which, as you rightly point out, is preserved by the legislation.

I think that perhaps the basis upon which you can do that is to file the affidavit within, say, the next seven days. If I am satisfied with the terms of the affidavit then I will make an order on the papers – I will not require further oral argument – but if I am not satisfied then you will be notified and you will have to come back before me. So the orders today in each matter – this was done by summons, was it?

MS VAN PROCTOR: It was, your Honour. It was summons filed on 23 December 2015.

HIS HONOUR: All right.

1. Summons is adjourned to be determined on the papers or otherwise relisted.
   
2. The respondent is to file and serve a copy of an affidavit setting out the substantive grounds upon which the orders are sought on or before Monday, 18 January 2016.
   

Now, Mr Edwards, do you have any submissions?

MR EDWARDS: Your Honour, for our part we do not wish to be heard on whether the order should be made. I should just draw to your Honour’s attention that as we understand the orders they do not affect anything that would be said in Court. It is simply designed to regulate the way in which third parties can have access to material on the file. So it would not affect the way the argument was presented.

HIS HONOUR: Yes. I mean if somebody wants to put some contention in that regard they will have to do so separately.

MR EDWARDS: Correct, your Honour.

HIS HONOUR: Yes, all right. Thank you.

MR EDWARDS: May it please the Court.

HIS HONOUR: All right.

3. Costs today will be reserved.
   

Ms Van Proctor, so if you can get your instructors busy on that then we can look at that, but I want to make it crystal clear that these orders are not made lightly and that the mere fact – with no disrespect of course to the primary judge who made them on the basis of materials before her, I do not have adequate materials before me at the present time upon which I will be prepared to make such orders.

MS VAN PROCTOR: Thank you, your Honour. I should, perhaps, just finally indicate that there was no material before her Honour in the form of an affidavit, but there will of course be an affidavit filed within seven days as your Honour has ordered.

HIS HONOUR: Yes, thank you.

MS VAN PROCTOR: Thank you.

AT 10.18 AM THE MATTERS WERE ADJOURNED