Saul, Ben; McCabe, Michelle --- "The Privilege Against Self-Incrimination in Federal Regulation" [2001] ALRCRefJl 13; (2001) 78 Australian Law Reform Commission Reform Journal 54

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Reform Issue 78 Autumn 2001

This article appeared on pages 54– 58 & 74 of the original journal.

The privilege against self-incrimination in federal regulation

By Ben Saul & Michelle McCabe*

The growth of federal regulation into significant new areas of social life has made the need for personal protection against self-incrimination greater than ever before. There are an increasing number of regulatory situations where administrative agencies and investigative bodies have been given powers by the parliament to compel individuals or companies to disclose certain information. Yet in the array of regulatory legislation, there is no consistent approach to the individual rights and protections available in such situations. For example, there are no uniform legislative provisions protecting people against self-incrimination or double jeopardy.

The courts have extended the privilege against self-incrimination to civil and administrative proceedings, ensuring some protection in the absence of legislative action. Yet the common law privilege is subject to seemingly arbitrary exclusion by a maze of express or implied legislative provisions. The inconsistent and contradictory nature of these provisions potentially undermines public confidence in equal treatment before the law, makes it difficult for individuals to comply with their legal obligations, and ultimately confuses and confounds the rule of law.

Self-incrimination at common law

The common law privilege against self-incrimination entitles a person to refuse to answer any question, or produce any document, if the answer would tend to incriminate that person. The privilege is an aspect of the broader common law right to silence, operating as a ‘general immunity’ from ‘being compelled on pain of punishment to answer questions posed by other persons or bodies’.¹

Historically, the privilege developed to protect an individual from testifying to her or his own guilt under the oppressive, inquisitorial methods of the English Star Chamber and ecclesiastic courts. In the leading Australian High Court case of Caltex,² Chief Justice Mason and Justice Toohey noted that the privilege evolved as a rule of evidence guarding individuals from the adverse physical and spiritual consequences of self-incrimination, preventing one from ‘cutting one’s throat with one’s own tongue’.³

Although broadly referred to as the privilege against self-incrimination, the concept encompasses three interrelated privileges: a privilege against self-incrimination in criminal matters; a privilege against self-exposure, say to a civil or administrative penalty or fine; and, less commonly, a privilege against self-exposure to the forfeiture of an existing right (such as to land, personal property, an office for profit, or to a parliamentary office).

The privilege applies in civil and criminal cases to exclude certain evidence, but it also applies as a protection wherever information may be compulsorily acquired by investigators, or by administrative agencies imposing penalties. It protects only the person who might incriminate him or herself, and cannot be invoked to shield others from incrimination. It does not extend to information that can be collected independently, such as fingerprints, breath tests or forensic samples.

Since 1995, s 128 of the Evidence Act 1995 (Cth) has essentially codified the common law privilege. Under the Act, a witness may claim the privilege against self-incrimination unless the court finds that the ‘interests of justice’ require evidence to be given. If the witness does give evidence, the court must give the person a certificate of immunity preventing the use of the evidence in subsequent civil or criminal proceedings (except perjury proceedings).

Rationales for the privilege

A number of justifications for the privilege have been suggested, including the:

• avoidance of self-accusation, perjury, and contempt (the ‘cruel trilemma’);

• underlying basis of the adversarial system; prevention of inhumane treatment;

• imbalance between state and individual power; protection of human personality, privacy and human rights; and

• unreliability of self-deprecatory statements; protection of the innocent.⁴

The prevailing view in Australia is that the privilege is grounded in the protection of human rights. The majority in Pyneboard described the privilege as ‘a human right which protects personal freedom, privacy and dignity’ from the power of the state.⁵

The privilege is a human right recognised under international law, although it is not a right enshrined in the Australian Constitution. Article 14(3)(g) of the International Covenant on Civil and Political Rights provides that ‘[i]n the determination of any criminal charge against him, everyone shall be entitled to the following minimum guarantees, in full equality... Not to be compelled to testify against himself or to confess guilt’. Unlike the common law, however, international law does not extend the privilege to civil and administrative proceedings.

Application to corporations

The privilege applies only to natural persons, and not to corporations, which – unlike individuals – have ‘no body to be kicked or soul to be damned’.⁶ Previously it was assumed that the privilege applied to corporations at common law, but since the decisions in Caltex and Abbco,⁷ confirmed by sections 128 and 187 of the Evidence Act, the privilege is unavailable to corporations in both judicial and non-judicial situations.

The judicial reasons for denying privilege to corporations include that corporations are not as vulnerable to the coercive power of the state as individuals, and that the privilege is a human right protecting individual (not corporate) freedom, privacy and dignity. In addition, the complexity of modern corporations and the importance of documentary records to business would make effective regulation (particularly detection of unlawful behaviour) too difficult if corporations were protected by privilege.

Company directors may claim the privilege in their own right where the disclosure would incriminate the officer personally. It is arguable that denying the privilege to corporations may, however, affect the privilege for directors personally.

Extrajudicial application

Historically, the privilege against self-incrimination ‘assumed greatest importance before judicial tribunals, for these are empowered ... to compel parties and witnesses to produce documents, answer questions and perform other acts’.⁸ In recent decades, federal legislation has increasingly conferred similar powers to acquire information on quasi-judicial tribunals, regulators and investigators. Commonwealth regulatory bodies now have extensive information gathering and investigative powers.

Courts have held that the privilege is applicable to all situations where information may be compulsorily sought, including before administrative tribunals and where penalties are imposed by administrative agencies with investigative powers. The inherent availability of the privilege can be excluded or modified by legislation. For example, s 8(3) of the Evidence Act provides that the Evidence Act applies subject to the Corporations Law and the Australian Securities Commission Act 1989 (Cth), which contain specific formulations of the privilege.

Legislative approaches

One commentator has noted the trend in recent years that ‘the scope of the privilege ... against self-incrimination ... [has] been severely constrained by both statutory provisions and judicial decisions’.⁹ In relation to the investigative powers of federal regulators, a common approach has been to legislatively remove or modify the privilege so that individuals are not entitled to refuse to produce self-incriminating documents, but are permitted subsequently to assert the privilege in civil or criminal proceedings commenced after the investigation. Removal or modification of the privilege, combined with powers to obtain information and documents, is a useful tool for regulators unable to obtain information through informal, voluntary or cooperative methods.

On the other hand, the removal of privilege may have serious consequences for individuals, and the courts have made it clear that the privilege should not be removed lightly. While legislative provisions presently provide some protection for individuals subsequently involved in court proceedings, the increasing use of administrative penalties suggests that existing legislative protections need further consideration.

Express restatement of the privilege. There are different formulations of the content of the privilege where it is expressly preserved under statute. A number of federal acts expressly restate the common law privilege in relation to specific provisions requiring the provision of information (but may remove, modify or remain silent in relation to other provisions). The usual method is to frame the privilege as a ‘reasonable excuse’ from complying with a requirement to give information.

The types of information privileged from exposure vary in federal legislation, with provisions most commonly referring to a privilege against answering questions and/or producing documents that may incriminate. Less commonly, the privilege can be claimed against a general requirement to provide information, often in addition to, or alternative to, the requirement to answer questions and/or produce documents. An information privilege is broader in scope than a documentary or questioning privilege, since it extends, for example, to compulsory disclosures of certain facts under social security or companies legislation.

Different provisions refer to the privilege in terms of protecting against disclosures that ‘may’, ‘might’, ‘will’ or ‘would’ incriminate a person or expose them to a penalty. There are clearly semantic differences between these terms, which could be interpreted as establishing gradations of privilege. The significance of different statutory formulations was considered in

F and Others v National Crime Authority (1998), where Justice O’Loughlin stated:

‘Both ‘may’ and ‘might’ are commonly used when referring to a possibility, or an opportunity and in that sense, they do not impose the same degree of capability as ‘will’ and ‘would’. Something that ‘may or might’ happen is less likely to occur than something that ‘will or would’ happen.’¹⁰

A statute which privileges disclosures that ‘might’ tend to incriminate would mean that lower risks of incrimination would attract the privilege. Conversely, there would be a greater obligation to disclose if protection is given only to disclosures that ‘will’ or ‘would’ tend to incriminate.

Another difference in the content of statutory formulations of privilege is that some provisions protect only against incrimination generally, while others refer expressly to a privilege against both incrimination and self-exposure to a penalty. It is not clear whether a provision that only refers to a privilege against incrimination excludes the penalty privilege. Ordinarily the common law will apply to the extent that it is not inconsistent with, or extinguished by, a statutory provision. The purpose or object underlying the legislation will also be relevant.

The Life Insurance Act, for example, while removing the privilege, renders information so obtained inadmissible in both ‘criminal proceedings’ and ‘a proceeding for the imposition of a liability’. The concept of a ‘liability’ extends much further than the usual privileges against incrimination and self-exposure to a penalty. A liability may be imposed through private litigation or pursuant to private contractual arrangements, whereas penalties broadly defined refer to impositions by government (extending, for example, to enforceable undertakings, or the removal of privileges such as a licence or a welfare benefit; although a liability is not a penalty if it were simply a liability to pay a licence fee or a tax, irrespective of wrongful behaviour).

Any statutory extension to privilege liabilities would be particularly significant given the decision of Australian Securities Commission v Kippe & Forgie.¹¹ In that case, the Full Federal Court held that the purpose of a banning order under s 829 of the Corporations Law was protective (of the public) and not a ‘proceeding for the imposition of a penalty’, despite consequences for the banned individual that were arguably as serious as a criminal charge. As a result, the proceedings were treated as civil and the privilege against self-incrimination (modified to a use immunity under s 68(3) of the ASC Act) did not apply. he characterisation of regulatory enforcement as penal or non-penal may affect the availability of the privilege. The broader concept of a liability encompasses a banning order, so that the privilege against self-exposure to a liability applies to such situations.

Implied application of the privilege. Prima facie, if legislation is silent on the existence of the privilege, the common law privilege survives. There is a presumption that the privilege has not been extinguished, since the courts regard it as fundamentally important.

In many situations the survival of the privilege is ambiguous. It is by no means clear to what extent the common law privilege has survived as protection against the powers of federal regulators. Confusion is increased in legislation where some provisions expressly remove or modify the privilege in relation to the provision of information, and other provisions remain silent on privilege. There is no consistent drafting of these arrangements as between federal statutes.

Absolute removal of the privilege. Statutes may remove the privilege expressly or by necessary implication. There must be clear words to expressly exclude the privilege, and implied removal requires a clear and plain intention of parliament.

The courts consider a number of factors when deciding whether the privilege has been impliedly removed. In Pyneboard, the majority held that ‘much depends on the language and character of the provision and the purpose it is designed to achieve’.¹²

For example, the privilege may be excluded where the terms of the statute impose an unqualified requirement to disclose information, and the aim of the statute is to fully investigate, in the public interest, possible breaches of the law. The privilege may also be excluded where claiming it would defeat the purpose of a statute. Arguably, where the obligation to answer is imposed to assist an administrative agency to secure information about the offence for which the privilege is claimed, an intention to remove the privilege may be more readily implied.

Even where the privilege has been expressly or impliedly removed by statute, the courts retain a discretion to exclude the information from subsequent court proceedings, on the grounds of policy and fairness.

Partial removal of the privilege & subsequent immunity. Sometimes statutes limit the use of information obtained by regulators using their investigative powers. There are three types of immunity potentially available:

(1) personal immunity: a total personal immunity from any further prosecution;

(2) use immunity: claimed by a person before answering questions which would incriminate and preventing the answers given from being admitted into evidence against that person in subsequent proceedings (excepting perjury);

(3) derivative use immunity: extends the immunity to prevent the admission of any other evidence obtained through further inquiries.¹³

A common legislative provision states that where privilege is removed and self-incriminating evidence is obtained, the information so obtained cannot be used in other criminal proceedings against the person,¹⁴ except in proceedings for providing false or misleading information, or refusing or failing to comply with notice requirements. This is known as ‘use immunity’. ‘Derivative use immunity’ is a less common legislative provision.

Other examples of federal legislative provisions include:

• the Australian Securities and Investments Commission Act 1989, the Banking Act 1959, the Customs Act 1901 and the Superannuation Industry (Supervision) Act 1993, which provide that evidence obtained is inadmissible in both criminal and other penalty proceedings;

• the Life Insurance Act 1995, which provides that evidence obtained is inadmissible in both criminal and broader ‘liability’ proceedings;

• the Migration Act 1958, which provides that evidence obtained is inadmissible in ‘any proceedings’;

• the Privacy Act 1988, which makes evidence obtained inadmissible in ‘any proceedings for an offence against a law’ of the Commonwealth, a territory or a state, or in any ‘disciplinary proceedings’, subject to an immunity certification procedure.

• the Superannuation Act 1976 and the Trade Practices Act 1974, which establish use immunity in criminal proceedings for corporations, other than criminal proceedings authorised under the respective acts.

In short, the immunity provisions in federal statutes display little systematic coherence and consistency across, and within, fields of regulation, producing much confusion and uncertainty as to the rights of the regulated.

Conclusion

Achieving a consistent legislative approach to privilege in federal legislation depends on rethinking the rationales and justifications for removing or modifying the privilege, and deciding whether particular fields of regulation require special rules of privilege. Most importantly, achieving consistency depends on questioning whether effective regulation requires greater use of intrusive measures like the removal of privilege, or whether more informal, cooperative or voluntary mechanisms – like leniency or immunity policies and discretions – would achieve greater compliance outcomes.

*Ben Saul is a Legal Officer, working on the ALRC inquiry into the use of civil and administrative penalties. Michelle McCabe is a final year law student at Wollongong University who recently completed an internship at the ALRC.

Endnotes

1. NSW Law Reform Commission The Right to Silence (Report 95) July 2000, 3.

2. Environment Protection Authority v Caltex Refining Co Pty Ltd [1993] HCA 74; (1993) 178 CLR 477.

3. B Marshall ‘The Penalty Privilege: Assessing its Relevance in Trade Practices Cases’ (1996) 14 Aust Bar Review 214, 215.

4. New Zealand Law Commission The privilege against self-incrimination: a discussion paper (1996), 25.

5. Pyneboard Pty Ltd v Trade Practices Commission [1983] HCA 9; (1983) 152 CLR 328, quoting Murphy J in Rochfort v Trade Practices Commission [1982] HCA 66; (1982) 153 CLR 134, 150.

6. British Steel v Granada Television [1981] AC 1096 per Denning LJ, at 1127.

7. TPC v Abbco Ice Works Pty Ltd [1994] FCA 1279; (1994) 14 ACSR 359.

8. Cross on Evidence Australian Edition, vol 1, 25041-25042, [para 25085].

9. R Woellner ‘The ASC’s Investigative Powers – some practical aspects’, 50th Anniversary Conference, Australasian Law Teachers’ Association: Cross Currents: Internationalism, National Identity & Law, 1995, <www.austlii.edu.au/au/special/alta/alta95/woellner1.html>.

10. (1998) 83 FCR 99 per O’Loughlin J, at 110.

11. [1996] FCA 517; (1996) 67 FCR 499; (1996) 137 ALR 423.

12. Pyneboard per Mason ACJ, Wilson and Dawson JJ, at 341.

13. P Sofronoff ‘Derivative Use Immunity and the Investigation of Corporate Wrongdoing’ [1994] QUTLawJl 6; (1994) 10 QUTLJ 122.

14. See, for example, the Civil Aviation Act 1988 (Cth), the Disability Services Act 1986 (Cth), the Environmental Protection and Biodiversity Conservation Act 1999 (Cth), the Health Insurance Act 1973 (Cth), the Insurance Act 1973 (Cth), the Migration Act 1958 (Cth), the Superannuation Act 1976 (Cth), the Trade Practices Act 1974 (Cth).