Panic stations? Responding to investigative notices in the wake of Smethurst v Commissioner of Police
The widely publicised High Court decision of Smethurst v Commissioner of Police  HCA 14 invalidating an Australian Federal Police search warrant issued on Sunday Telegraph journalist, Annika Smethurst, could have wider implications for statutory notices issued by state or federal regulatory authorities. In April 2020, the Court was unanimous in holding that warrants issued by Australian Federal Police must be clearly expressed in unmistakable and unambiguous language in order to be valid and enforceable.
In June 2019, the Australian Federal Police (AFP) searched the residence of Annika Smethurst (Smethurst), a journalist employed by Nationwide News Pty Ltd, the publisher of newspaper the Sunday Telegraph. To do so, the AFP relied on a search warrant that had been issued by a Magistrate the previous day in connection with alleged acts by Smethurst and the Sunday Telegraph a few weeks prior that were said by the AFP to be offences under the Crimes Act 1914 (Cth) (Crimes Act). The three articles published in the Sunday Telegraph entitled, "We don't want Big Brother watching"; "Secret plan to spy on Aussies"; and "Spies told just keep looking elsewhere", reported that amendments under consideration by Federal Parliament to existing legislation would extend the powers of the Australian Signals Directorate so as to enable it to covertly access data respecting not only foreigners, but also Australian citizens.
Following the publication of the articles, the AFP applied to a Magistrate for permission to issue the warrant relying on sworn evidence of AFP officers that they had reasonable grounds for suspecting that evidential material meeting the test in the Crimes Act was located at Smethurst’s home. In executing the warrant, the AFP was seeking to obtain evidence:
- in the form of notes, diaries, correspondence, emails and other forms of electronic messaging, minutes, reports, briefing documents, assessments, graphics, sketches or photographs, story pitch, planning logs, broadcast and online schedules, story boards, website content and USBs
- relating to Smethurst, the Sunday Telegraph, "News Corp", the Australian Signals Directorate, the Department of Home Affairs, the Department of Defence and the webpage on which the articles in question were published
- in connection with the unlawful communication of, and grant of access to, a document to a person in a manner that was inconsistent with the interests of the Commonwealth (in breach of the Crimes Act).
Relying on the warrant, the AFP searched Smethurst’s premises and seized documents and materials from it. Subsequently, both Smethurst and Nationwide News Pty Ltd brought proceedings in the High Court seeking (relevantly) to have the warrant quashed on various grounds, including that the warrant failed to adequately identify and, in fact, misstated the offence being investigated by the AFP.
The High Court decision
The High Court unanimously upheld both of these grounds, finding that:
- The warrant failed to adequately identify the offence being investigated and lacked the clarity required to fulfil its basic purposes of:
- adequately informing Smethurst why the search was being conducted
- providing the executing officer reasonable guidance to decide what evidentiary material came within the scope of the warrant.
- The warrant was not only inadequate in its identification of the offence, but also misstated the offence being investigated by the AFP and the subject of the warrant. In describing the alleged offence (at the third condition of the warrant), the AFP focussed on Smethurst and the Sunday Telegraph having “communicated a document or article to a person, that was not in the interest of the Commonwealth and permitted that person to have access to the document, contrary to section 79(3) of the Crimes Act”. The Court considered that the description of that key element in the search warrant (being that Smethurst held a document, an article or information "not in the interest of the Commonwealth" in breach of section 79(3) of the Crimes Act) had misstated the offence and the warrant was therefore invalid.
Possible broader ramifications of the decision
Of course, the AFP is not the only regulatory authority that has the power to seek or issue compulsory investigatory notices. For instance, the Australian Securities and Investments Commission Act 2001 (Cth) (ASIC Act) provides ASIC with a power to investigate ‘as it thinks expedient for the due administration of the corporations’ legislation’ where there is reason to suspect (broadly described) a contravention of the ASIC Act or the Corporations Act 2001 (Cth). Similar powers exist for other federal agencies, such as the Australian Taxation Office, Australian Competition and Consumer Commission, as well as state Agencies, like NSW Environmental Protection and Safework NSW.
The decision in Smethurst is particularly interesting because, while the Court acknowledges that previous authority undoubtedly favours a broad interpretation of these coercive powers, it also acknowledges that there are limits to those powers that must be carefully considered before imposing on an individual’s rights to privacy.
The power to search a person’s home or a business premises is an exceptional power that should only be exercised under certain justifying conditions, and a balance must be struck between the need for an effective justice system, and the need to protect the individual from arbitrary invasion of their privacy.
While the Court accepted that this balance favours the public interest to a greater extent (and this is supported by the case law), the Court held that the legislature is also concerned with providing a measure of protection to a person affected by a warrant or notice by ensuring that the object of the instrument is identified by clear reference to a particular offence and that the limits of the authority to search can be understood by the person on whom it is served.
That is to say, the state and federal agencies that have powers of search and seizure are not given an automatic statutory immunity to infringe on the common law rights of an individual or an organisation. A warrant or notice that impinges on common law rights must meet statutory conditions in order for it to meet the legislative purpose of search and seizure powers, being protection of the public interest. This is achieved by clearly stating the nature of the offence that is the subject of the notice in a way which is both intelligible and sufficient to convey what those concerned with, or affected by the notice, need to understand and ensure that the persons preparing the notice, executing the notice, or affected by the notice, understand the object of the notice and the limits of it.
Key lessons from Smethurst
If your organisation is issued with a compulsory notice from a regulator, you should:
- Immediately get legal advice: Perhaps the most critical step in responding to a statutory notice is to get legal advice and representation from solicitors with extensive experience in this area. Under much of the empowering legislation, you are entitled to be represented by a lawyer at any examination, and you are also entitled to obtain legal advice and/or representation when providing information, books or records, in compliance with a notice. This includes, for example, if a regulator presents at your premises unannounced and serves you with a notice. In addition, some of the documents or things requested by the regulator could be subject to legal professional privilege or confidentiality. It is therefore recommended that you seek legal advice in relation to these issues before responding to a notice from the regulator.
- Assess the notice to ensure it is clear and unambiguous: Notices issued by regulators must specify the information sought with sufficient particularity to enable the recipient to know what is required. There should not be any confusion about how to respond to a notice issued. Notices should clearly state:
- the legislation under which the notice is being issued
- the purpose of the notice
- the scope of the notice including:
- the types of documents or things to be produced
- the time period or date range of those documents or things
- the relevant persons affected by the notice
- the specific nature of documents or things being sought.
- Seek clarification: If any aspect of the notice is unclear, you should seek clarification from the regulator as soon as possible. Responses to notices are normally required by regulators within a specified time period and, as such, you should also consider requesting an extension of time to respond to a notice if you are having difficulty locating relevant documents or seeking information from relevant persons within the response period.
- Have a response plan: If you don’t already, consider having a response plan in place in the event you are issued with a notice (or in the event of a dawn raid). Importantly, a considered response plan avoids panic among staff members and ensures compliance with the notice in accordance with your obligations under the relevant legislation. Broadly, the response plan should outline:
- the key contact people in the event your business is issued with a search warrant or statutory notice including internal contacts and external legal representatives
- your rights under the relevant legislation in responding to a notice or search warrant
- how to determine whether the regulator is authorised to request documents or conduct a search warrant and the questions you should ask the executing officer before allowing access to your premises (if necessary)
- how to logically access and provide documents in accordance with the notice (by way of electronic searches or otherwise) while maintaining business confidentiality, compliance with fiduciary duties and legal professional privilege.
 In this article, when discussing investigative powers of state or federal Regulatory agencies, for simplicity we use the term notice rather than warrant.
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