Peter A Clarke

Private litigation under the Privacy Act is quite uncommon.  Part of that is no doubt due to the limited scope for a person to bring such an action under the Act.  It is essentially limited to section 98.   The other reason may be a lack of knowledge of the operation of the Act.  Many think of the Privacy Act as being essentially a means to regulate the retention and use of personal information.  And to a large extent tht is its function.  But not exclusively.

In a very interesting speech titled Privacy Litigation: Substantive lessons and tactical trends – Smallbone v New South Wales Bar Association, delivered to the 2nd National Information Law Conference in Canberra on 15 November 2012 Justice Griffiths considered the use of the Privacy Act by a barrister, Smallbone, to obtain procedural fairness in his application for silk..

The speech highlights the impact of the Privacy Act on the activities of private organsiations and how how it can be used as a vehicle of proecdural rights, in particlar the requirement to afford an individual procedural fairness, that would not otherwise be available to a member of such an organisation as well as a right to access and correct personal information.  In an era of big data and its collection by private organisations this is an important right.

The speech warrants detailed consideration by those interested in privayc issues generally but those who practice in the area of privacy law.  It provides (less numbering and citations):

Introduction

Hollywood has its Oscars; the AFL has its Brownlow Medal night; the NRL has its Dally M awards; and the NSW Bar has a day in October when the list of successful applicants for Silk is announced.  Each of these award events generates rumours, wide public interest and plenty of media attention.  That was certainly the case last year when David Smallbone, a junior barrister at the NSW Bar, brought proceedings against the NSW Bar Association arguing that he had an entitlement under the Privacy Act 1988 (Cth) (the Act) to have access to personal information collected by the Bar Association in respect of his application for Silk (Smallbone v New South Wales Bar Association (2011) 198 FCR 17).  Moreover, he argued that no decision should be made in respect of his Silk application until he had had an opportunity to review the relevant information and, if necessary, have it corrected.

There are many intriguing aspects of that litigation.  Of particular significance is how the Act was used as a Trojan Horse to overcome probable difficulties in otherwise establishing that the Bar Association owed Mr Smallbone procedural fairness in considering and determining his application for Silk.

 I will seek to highlight that and other matters in this paper.  I should emphasise at the outset that I appeared for the NSW Bar Association in the Smallbone litigation, prior to my appointment to the Federal Court.

 I propose to now outline the process for appointing Silks in NSW in 2011, before summarising the relevant legislative framework and key relevant features of the Smallbone litigation.  I will then highlight how the case goes some way towards establishing surrogate procedural fairness obligations.

Summary of NSW Silk appointment process

 Those of you who are unfamiliar with the process may well ask why people seek to be appointed as senior counsel.  The NSW Law Reform Commission identified the following two main reasons why junior barristers apply to become Silks:

First, there is a desire for advancement.  In general, [senior counsel] enjoy higher incomes and status than junior counsel, and many judicial appointments are made from their ranks.  Secondly, there is a desire to change the nature of their work.  In general, [senior counsel] conduct the heavier types of litigation and the more responsible advisory work; they devote their time to the preparation and conduct of relatively few cases and are thereby enabled to concentrate more intensively on each case.

The process for appointing senior counsel in New South Wales has changed over the last few years.  Appointments were previously made by the Attorney-General.  With the abolition of the title “Queen’s Counsel” in 1991, the NSW Bar Association assumed responsibility for appointing persons as senior counsel.  In general terms, in 2011, the process involved a selection committee, comprising the two most senior officers of the Bar Council, three other senior counsel and a non-practising representative.  The selection committee received applications containing a good deal of personal information about individual applicants and then embarked upon a process of consultation.  The consultation group comprised selected barristers and solicitors, as well as a judicial consultation group which was comprised of a wide range of judicial officers in both state and federal courts, as well as tribunal members.  Approximately 600 people were consulted within those groups.  The nature of the consultation took various forms.  All members of the groups were asked to fill in and complete a detailed form, marking alongside any applicant in respect of whom they had had professional exposure over the three previous years three boxes marked “Yes”; “No” and “Not Yet”.  Pro forma consultation forms required those consulted to identify themselves by name if they returned their consultation forms.  Assurances of confidentiality were extended to those who were consulted.

Members of the selection committee could, and did, consult more directly with individual members of the consultation groups to obtain additional information concerning their views as to the suitability of particular applicants to be appointed Silk.  Those discussions were invariably conducted on a confidential basis.  The selection committee met several times to discuss the merits of individual applicants and took into account the views expressed by those who had been consulted.  The Chief Justice of New South Wales was consulted after the selection committee had prepared a final draft list of the successful applicants.  As in other years, the outcome of the process was announced in early October.

 Since 1992 the Bar Association has had a protocol for the appointment of senior counsel.  It describes the process for appointing Silk.  It also describes the criteria against which applications are judged.  It contains various provisions dealing with confidentiality of information collected as part of the process which, in 2011, included the following provisions:

 The collection of information relating to appointment of Senior Counsel is governed by National Privacy Principle 2 and will not be used or disclosed for a purpose other than the selection of Senior Counsel and the giving of counselling by the President to unsuccessful applicants.

 In accordance with National Privacy Principle 4, to protect the confidentiality of the material it gathers, the Bar Association will destroy or permanently de-identify all documentation in its possession in relation to the selection process as soon as practicable after each year’s appointments are announced.

 It is a requirement of making an application for appointment of Senior Counsel that the applicant agrees that information collected by the Bar Association in conjunction with their application, including information obtained by third parties, is confidential information in terms of the National Privacy Principle 6(1)(c).

 Applicants are to be made aware that their applications will be the subject of distribution during the selection process and it will therefore be impossible to keep confidential the fact that an application has been made.

  Members of the consultation groups to whom consultation forms were sent received the following assurance of confidentiality:

 All information received will be treated as confidential, except to the Selection Committee. The Association does not distribute the list of applicants to anyone other than the Selection Committee and members of the Consultation Group. I would ask that you keep the list confidential.

 They were also given the following assurances about the confidentiality of information provided under the process:

 The collection, use and destruction of information relating to the appointment of Senior Counsel is governed by the National Privacy Principles. Accordingly, any information you supply will not be used or disclosed for a purpose other than the selection of Senior Counsel and the giving of counselling by the President to unsuccessful applicants.

 The Bar Association destroys or permanently de-identifies all documentation in its possession relating to the selection process as soon as practicable after each year’s appointments are announced.

 All information received is treated as confidential and is made available only to the Selection Committee and its Secretariat. The Association does not distribute the list of applicants to anyone other than the Committee and members of the Consultation Group. I would ask that you keep the list confidential.

 In 2011, the pro forma application for appointment as Silk contained the following clause, which applicants were required to acknowledge and accept:

 I agree that information collected by the Bar Association in conjunction with this application including information obtained from third parties, is confidential information in terms of National Privacy Principle 6(1)(c). I note that the Bar Association will destroy documentation in its possession relating to the selection process as soon as practicable after this year’s appointments are announced.

Summary of relevant provisions of the Act and National Privacy Principles

 It is convenient at this point to summarise the key relevant provisions of the Act and National Privacy Principles (“the NPPs”).

The Act applies to “personal information”, which is defined in section 6 as follows:

personal information means information or an opinion (including information or an opinion forming part of a database) whether true or not, and whether recorded in a material form or not, about an individual whose identity is apparent, or can reasonably be ascertained, from the information or opinion.

 It should also be noted that “record” is defined in section 6 to mean relevantly a document or a database.  The definition of “record” is important because the Act generally only applies to collection of personal information by an organisation covered by the Act if the information is being collected for inclusion in a record or a generally available publication (see sub-sections 16B(1) and (2)).

Under section 13A of the Act, an act or practice of an organisation is an interference with the privacy of an individual if inter alia the act or practice breaches a NPP in relation to personal information that relates to the individual.

The NPPs are to be found in Schedule 3 of the Act.  They deal with various obligations and rights under such headings as “collection”, “use and disclosure” and “access and correction”.

For the purposes of this paper it is convenient to set out the following potentially relevant NPPs:

1.         Collection

1.1       An organisation must not collect personal information unless the information is necessary for one or more of its functions or activities.

1.2       An organisation must collect personal information only by lawful and fair means and not in an unreasonably unintrusive way.

1.3       At or before the time (or, if that is not practicable, as soon as practicable after) an organisation collects personal information about an individual from the individual, the organisation must take reasonable steps to ensure that the individual is aware of:

(a)        the identity of the organisation and how to contact it; and

(b)        the fact that he or she is able to gain access to the information; and

(c)        the purposes for which the information is collected; and

(d)        the organisations (or the types of organisations) to which the organisation usually discloses information of that kind; and

(e)        any law which requires the particular information to be collected; and

(f)        the main consequences (if any) for the individual if all or part of the information is not provided.

1.4       If it is reasonable and practicable to do so, an organisation must collect personal information about an individual only from that individual.

1.5       If an organisation collects personal information about an individual from someone else, it must take reasonable steps to ensure that the individual is or has been made aware of the matters listed in subclause 1.3 except to the extent that making the individual aware of the matters will pose a serious threat to the life or health of any individual.

2.         Use and disclosure

2.1       An organisation must not use or disclose personal information about an individual for a purpose (the secondary purpose) other than the primary purpose of collection …

…

3.         Data quality

…

4.         Data security

4.1       An organisation must take reasonable steps to protect the personal information it holds from misuse and loss and from unauthorised access, modification or disclosure.

4.2       An organisation must take reasonable steps to destroy or permanently de-identify personal information if it is no longer needed for any purpose for which the information may be used or disclosed under National Privacy Principle 2.

5.         Openness

5.1       An organisation must set out in a document clearly expressed policies on its management of personal information.  The organisation must make the document available to anyone who asks for it.

5.2       On request by a person, an organisation must take reasonable steps to let the person know, generally, what sort of personal information it holds, for what purposes, and how it collects, holds, uses and discloses that information.

6.         Access and correction

6.1       If an organisation holds personal information about an individual, it must provide the individual with access to the information on request by the individual, except to the extent that :

(a)        …; or

(b)        …; or

(c)        providing access would have an unreasonable impact upon the privacy of other individuals; or

(d)        the request for access is frivolous or vexatious; or

(e)-(k) … .

The Smallbone litigation

 In July 2011, Mr Smallbone lodged an application for appointment as senior counsel.  He crossed out the clause requiring his agreement that information collected by the Bar Association in respect of his application would be confidential information in terms of NPP 6.1(c).  Indeed, he wrote that that requirement was specifically not agreed to by him.  He said that he required access to information collected about him in the course of the Silk selection process.  Despite Mr Smallbone’s rejection of the proposition that information collected about him was confidential information in terms of the NPPs, his application was processed and information concerning him was collected by the selection committee in the normal way.  That information comprised:

• the correspondence between Mr Smallbone and the Bar Association concerning his application;
• the consultation forms returned by various members of the consultation groups;
• an internal report prepared by Bar Association staff in respect of Mr Smallbone providing a statistical analysis of the returned consultation forms as well as a statistical analysis in respect of each court concerning all applications for appointments; and
• internal statistical analyses were also provided in respect of sub-categories of persons consulted (broken down by reference to judicial officers, senior counsel, junior counsel and solicitors).

 The Bar Association declined to provide Mr Smallbone with access to the relevant information.  Mr Smallbone commenced proceedings in the Federal Court seeking injunctive relief under s 98 of the Act.  He said that he had a right of access to the information which he should be allowed to exercise before any determination was made in respect of his Silk application.  He said that his right of access was necessary in order to establish whether the personal information concerning him was accurate, complete and up-to-date, pursuant to NPP 6.5 and 6.6.  He sought to restrain any decision in respect of his Silk application until these matters were finalised.

In response, the Bar Association argued that it enjoyed an absolute exemption from having to disclose the relevant information relying on NPP 6.1(c).  That exemption was to the effect that, if an organisation held personal information about an individual, it had to provide the individual with access to the information on request, except to the extent that providing access would have an unreasonable impact on the privacy of other individuals.  This exemption was relied upon in circumstances where no express exemption was provided in the NPPs to confidential information per se.  The Bar Association was particularly concerned about its capacity to solicit information and comments about candidates from judges and other legal practitioners if there was a risk that their views would become known to candidates.  Serious consequences could ensue for the efficiency of the legal process if the identity and views of those consulted were disclosed to individual applicants.  In the case of judges, for example, such information might be relied upon by an aggrieved applicant for Silk to seek to have the judicial officer disqualified from hearing any cases in which the practitioner appears on the grounds of apprehended bias.  This would be seriously disruptive to the proper administration of justice.  Likewise, fellow legal practitioners could be seriously compromised in their relationships with an unsuccessful applicant if the regime of confidentiality under which they provide comments on individual applicants is not upheld.

Although they were not raised in Smallbone, other exemptions may potentially apply, such as those in NPP 6.1(g) and (h).  Those exemptions are to the effect that access to personal information need not be given to the extent that:

(g)           providing access would be unlawful; or

(h)          denying access was required or authorised by or under law.

The Privacy Commissioner has ruled that common law and equitable obligations, including obligations of confidence, constitute “law” for the purpose of these exemptions – see, for example, O v Automotive Company [2009] PrivCmrA 18.  It follows that, where the provision of access to personal information involves a breach of confidence, it is arguable that disclosure would be “unlawful” and/or that the denial of access is “required or authorised” by law.

Justice Yates’ reasoning

 Yates J took an intermediate course between the parties’ competing submissions concerning the nature and scope of the exemption in NPP 6.1(c), as is reflected in [47] of his reasons:

 In my view… NPP 6.1(c) provides an exception to a general rule. The general rule is that, if an organisation (such as the respondent) holds personal information (such as the information held by the respondent as a result of the selection process) about an individual (such as the applicant), access must be provided to the individual upon that person’s request. The exception provided by NPP 6.1(c) is one among a number of possible exceptions that might apply in a given case. But it is not necessarily an absolute exemption. This is made clear by the words “except to the extent that” in the chapeau to NPP 6.1(c). What is required is that access to the information be provided except to the extent that it would have the unreasonable impact to which NPP 6.1(c) refers.

 In determining whether the provision of access to the relevant information would have an “unreasonable impact”, his Honour described the exercise as being “essentially a matter of practical judgment having regard to all the circumstances of the case” and involving “a factual evaluation”.  Applying that approach to the particular circumstances here, his Honour held:

 (a)               given the circumstances in which the personal information was sought and provided, as well as the nature of the information itself, granting Mr Smallbone access to all the information he sought would directly or indirectly identify members of the consultation groups and have an unreasonable impact upon the privacy of those individuals;

 (b)               however, by de-identifying the information so as to protect the identities of those persons, Mr Smallbone was entitled to have access to the de-identified personal information; and

 (c)               the Bar Association should be restrained from making any adverse determination in respect of Mr Smallbone’s Silk application until after he had an opportunity to access and review the relevant material and determine whether he wished to pursue his rights under NPPs 6.5 and 6.6.

Some comments on the significance of the Smallbone litigation

 In my view, the major significance of Smallbone lies in the way in which the Act was used, in effect, to create an obligation to afford Mr Smallbone a form of procedural fairness in respect of his application for Silk in circumstances where it is improbable that he would have been able to establish such an obligation absent the Act’s application to the Bar Association.

 As noted above, the process for selecting Silk in NSW takes place in the context of a private law relationship between persons such as Mr Smallbone and the NSW Bar Association.  Mr Smallbone happened to be a member of the Bar Association, but persons other than members are entitled to apply for Silk.  In neither case is there any exercise of a public law power, whether statutory or non-statutory.

 That is to be contrasted with the position which obtained, for example, in the Northern Territory when, an unsuccessful applicant for Silk sought judicial review in the Federal Court in 1993.  In Waters v Acting Administrator of the Northern Territory (1993) 119 ALR 557, Mr Waters sought judicial review of a decision by the Northern Territory Cabinet not to approve his appointment as Queen’s Counsel notwithstanding that a favourable recommendation had been made by the then Chief Justice and was supported by the Attorney-General and the Territory’s legal professional bodies.  Mr Waters argued that he had a legitimate expectation of being appointed as Silk and that he had been denied procedural fairness because, he said, the Cabinet must have acted on some information which was adverse to him and he was not provided with an opportunity to deal with it.

 Justice Olney held that the decision-making process was non-justiciable.  His Honour drew an analogy with appointments to judicial office (citing the High Court’s decision in Attorney-General (NSW) v Quin (1990) 170 CLR 1).  Olney J expressed the analogy in the following terms at 573:

There is a close similarity between the decision-making process adopted under NT legislation for the appointment of both Supreme Court judges (Supreme Court Act 1979 (NT) s 32) and Queen’s Counsel. In each case the appointment is by commission granted by the Administrator. There are compelling reasons to equate an appointment as Queen’s Counsel with a judicial appointment. Both have their origins in the Crown prerogative and both involve an assessment not only of the professional eminence of the appointee but of his or her personal character and suitability to occupy the office and in both cases policy decisions unconnected with the personal merit and standing of an individual are apt to be influential. It has not been the practice in Australia to subject judicial appointments to the scrutiny of judicial review nor has it been so in respect of the appointment of Queen’s Counsel. There are no factors, either constitutional or legislative, which distinguish the situation in the NT from that which prevails elsewhere in Australia. The weight of persuasive authority is against the proposition that the decision not to appoint the applicant is justiciable.

 Olney J added that, in any event, even if the decision was justiciable, neither Mr Waters nor any other applicant for Silk had any legitimate expectation that they would be appointed or given an opportunity to respond to any adverse representations or material relied upon by the Cabinet.

 Given the current scheme for selecting Silk in NSW, there appears to be little or no scope to argue that the power being exercised by the Bar Association is either a statutory or a prerogative power.  There may, however, be at least two potentially arguable ways in which the process might attract some form of judicial review.  The first involves adoption and application of the English line of authority which can be traced back primarily to the Court of Appeal’s decision in R v Panel on Takeovers and Mergers; ex parte Datafin Plc [1987] QB 815.  In that case, judicial review was extended to non-statutory decision-making by a non-government agency on the basis that the test of reviewability of the exercise of a non-statutory power should turn not on who is exercising the power, but rather on whether the relevant power is substantially a public, not a private, function.

 The second potential avenue for challenge may arise if it can be established that there is a contractual relationship between applicants for Silk and the Bar Association, in which an obligation to afford procedural fairness should be implied.  This argument is likely to have greater relevance to members of the Bar Association who, as Justice Yates observed, are members of the company by which the Bar Association is constituted.  There is a line of cases in Australia which stands for the proposition that procedural fairness obligations may be owed by bodies such as professional and sporting clubs to their members as an aspect of their contractual relationship.  The cases are helpfully described and examined by Campbell J in McClelland v Burning Palms Surf Lifesaving Club (2002) 191 ALR 759.  After discussing relevant English and Australian authorities, Campbell J made the following observations at [97]:

In Australia, the preferable view is that natural justice comes to operate in private clubs and associations by the rules of those private organisations being construed on the basis that fair procedures are intended, but recognising the possibility that express words or necessary implication in the rules could exclude natural justice in whole or part.

 His Honour also regarded it as significant that the club in question was incorporated under the NSW Associations and Incorporation Act 1984 (NSW).

 The argument that there is a contractual relationship between applicants for Silk and the Bar Association would be stronger (even in the case of applicants who are not members of the Bar Association), if a payment was required in order to process an application for appointment.  That is currently the case in England and Wales where, apparently on the basis of the “user-pays” principle, applicants for Silk now have to pay an amount of approximately $4,000 to have their applications processed and, if they are successful, they are required to pay an additional amount of approximately $7,000.  That is not the case in NSW.  In my view, if such requirements were ever contemplated here, careful consideration would need to be given to the implications of having to pay such fees for the nature of the relevant legal relationship and the possible consequential attraction of procedural fairness principles which may otherwise not apply.

The Trojan Horse

 For reasons stated above, there are strong doubts whether procedural fairness obligations are currently owed by the Bar Association to applicants for Silk.  But, by successfully relying upon the Act, Mr Smallbone was effectively able to establish an entitlement to benefit from some of the processes which are ordinarily associated with procedural fairness obligations.  In particular, by successfully relying upon the Act, he was able to obtain access to certain information about his application which was not provided to other applicants in respect of their applications.  In particular, he was ultimately successful in having access to redacted and anonymised information provided to the selection committee by persons who were consulted about his application.  That information included not only the results of the survey forms affecting him, but also redacted and anonymised notes created by members of the selection committee recording the comments of persons who were further consulted about Mr Smallbone’s application.  From one viewpoint, armed with that additional information, Mr Smallbone was in a stronger position than others to contest the accuracy of that information.  Moreover, he arguably derived an additional advantage by having access to that information before a decision was made in respect of his Silk application because he was in a position to seek to have the material corrected in accordance with the relevant provisions of the NPPs.  Finally, even though his application in 2011 was ultimately unsuccessful, he knew more about the possible reasons for that result than other unsuccessful applicants.  Of course, all unsuccessful applicants are entitled to participate in a debrief with the President of the Bar Council, but it is a matter for the President to determine the nature of the information provided to the unsuccessful applicant in that process.

I am not suggesting that these outcomes are necessarily undesirable.  They flow from the fact that the Act applies to the Bar Association and that will continue to be the case as matters stand at present.  The position will not change when the provisions of the Privacy Amendment (Enhancing Privacy Protection) 2012 (Cth) commence.  It is a matter for the Bar Association to determine whether it should explore the possibility of persuading the Privacy Commissioner to make a Privacy Code relating specifically to the Silk application and determination process.  Any such code would prevail over the NPPs by virtue of s 16A of the Act.

The Smallbone litigation is a timely reminder to other private organisations of the potential impact of the Privacy Act on their activities and operations.  Even if such organisations are not subject to freedom of information legislation (which contains its own provisions enabling incorrect information to be corrected), a similar outcome can be achieved under the Privacy Act where that Act applies.  Nothing in the Privacy Amendment (Enhancing Privacy Protection) Act 2012 will alter that position.  It is also to be noted that the relevant NPPs which operated to produce the outcome in Smallbone are generally reflected in the forthcoming Australian Privacy Principles 12 and 13, which deal with access to personal information and correction of personal information respectively.

The Smallbone litigation also highlights how the Act can be used as a vehicle to obtain important procedural rights which otherwise would probably not be available if procedural fairness obligations do not arise.  And because those procedural rights to access and correct personal information are derived from the Act itself, their application and content can only be modified by an appropriate statutory amendment.  This is to be contrasted with the position regarding procedural fairness in the context of private sporting and other professional bodies and their members, where there is capacity to exclude or modify procedural fairness requirements by contractual agreement.  A further advantage of the rights conferred by the Act is that they not only involve a right of access, but also a right to correct personal information, a right which does not arise under procedural fairness obligations.

Finally, it may well be that the right of access to personal information under the Act (even in a redacted form to protect the privacy of third parties) could be more beneficial than enforcing procedural fairness requirements (assuming that such requirements are engaged in a particular case).  There is some uncertainty regarding the extent to which procedural fairness requirements of disclosure of adverse information are tempered by considerations of confidentiality (see generally Minister for Immigration and Citizenship v Maman (2012) 200 FCR 30 at [34]-[37] per Flick and Foster JJ).  The common law approach to reconciling procedural fairness obligations with confidentiality constraints is a pragmatic one which depends upon the individual facts and circumstances in which the issue arises, as is illustrated by cases such as Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 225 CLR 88 at [22]; Canterbury Building Society Ltd v Baker [1979] 2 NSWLR 265 and Ansell v Wells (1982) 63 FLR 127 at 140-1 per Davies J.  In some cases where procedural fairness applies, protection may be afforded to confidential information in determining what material has to be disclosed for comment.  In other cases, even confidential information which is adverse to a person’s rights or interests may need to be disclosed for comment.

Procedural fairness may not require the disclosure of all information which is “credible, relevant and significant”: it may be sufficient that the gravamen or substance of an issue be brought to the affected person’s attention: McVeigh v Willara Pty Ltd (1984) 6 FCR 587 at 600.  There is no such limitation under the Act.

Conclusion

The Smallbone litigation demonstrates how rights of access to personal information under the Act can operate as a surrogate form of procedural fairness.  This may have considerable practical significance, particularly in cases where there is doubt whether procedural fairness requirements are engaged.  And even where those requirements do apply, the rights and obligations created by the Act may produce more beneficial outcomes for at least some aggrieved persons.