The beginning of the year provides an opportune time to provide a governance update on the nature of corrupt conduct following the controversial judgment in Cunneen v Independent Commission Against Corruption. Although the plain reading of the definition of corrupt conduct in the Independent Commission Against Corruption Act 1988(NSW) shows that the concept of corrupt conduct casts a very wide net, there are limits to the types of conduct that might be considered corrupt.

If the decision of the majority in the Court of Appeal is upheld in the High Court, it will impose substantial ramifications on the type of conduct that constitutes ‘corrupt conduct’ and therefore the type of conduct that needs to be reported to the Independent Commission Against Corruption (ICAC), and which ICAC can conduct enquiries into.

The alleged corrupt conduct

The allegation that is the subject of ICAC’s inquiry was that NSW’s Deputy Senior Crown Prosecutor, Margaret Cunneen SC, and her son counselled Sophia Tilley to fake chest pains and that Sophia Tilley faked chest pains to prevent investigating police officers from obtaining evidence of Tilley’s blood alcohol level at the scene of a motor vehicle accident (paragraph 129 of judgment). All three persons sought injunctions to restrain ICAC from continuing its investigation, or restraining ICAC from holding its public inquiry. Their basis for seeking the injunction was that ICAC had no power to investigate the alleged conduct as it did not meet the definition of corrupt conduct in section (8)(2) of the Independent Commission Against Corruption Act 1988 (NSW) (ICAC Act).

The legislative definition of corrupt conduct

‘Corrupt conduct’ is defined under section 7 of the ICAC Act.  This section states:
(1) For the purposes of this Act, corrupt conduct is any conduct which falls within the description of corrupt conduct in either or both of subsections (1) and (2) of section 8 , but which is not excluded by section 9.

Section 8(1) states that corrupt conduct is any conduct of any person that could adversely affect the honest or impartial exercise of official functions by any public official, but it also includes under s8(2) any conduct of any person that could both:

  1. adversely affect the exercise of official functions by any public official; and
  2. which could involve perverting the course of justice.

The parties agreed that the Commission’s authority to conduct the investigation fell within section 8(2), or not at all.  In other words, if the conduct did not meet the test in section 8(2), the conduct was not ‘corrupt’ and could not be the subject of an inquiry.

The focus of the case was therefore on the two limbs set out in section 8(2), and whether each could be made out.

In short, only the Chief Judge held that the conduct fulfilled both limbs of the section 8(2) definition, whereas the majority held that it did not.

The judgment

The issue that arises is which of the following two situations satisfies the first limb:

  • where the conduct might lead the public official into error but does not do so
  • where the conduct might lead the public official into error and actually does so.

The focus is on whether the actions caused the relevant public official (in this case the police officer) to make a different decision. In summary, the majority holds that conduct that does not actually lead a public official into dishonest, partial or otherwise corrupt conduct does not satisfy the first limb. However, the minority judgment of Bathurst CJ must be thought to have some weight. The table below summarises the competing interpretations of ‘corrupt conduct’ under section 8(2) provided by the different judgments in the New South Wales Court of Appeal.

While the second limb of section 8(2) was held by all judges to have been satisfied, both limbs of section 8(2) needed to be satisfied, and the Court held that limb one was not made out.

The majority therefore ruled that ICAC had no authority to investigate the alleged conduct.

Actions and implications following the decision

Since the judgment, ICAC sought and was granted special leave to appeal the decision in the High Court. The High Court is scheduled to hear the matter in June 2015.

We will follow the High Court decision closely, and report on it given the ramifications this has on the breadth of conduct which is corrupt.  In this regard, if the Court of Appeal’s decision is upheld, then the alleged conduct of the Deputy Senior Crown Prosecutor, even if it could be shown to have involved perversion of the course of justice, could not be ‘corrupt conduct’ under the ICAC Act.  ICAC would be constrained from investigations involving conduct where that conduct has not led to any alleged dishonest or partial exercise of official functions by a public official or authority.  No doubt, the decision will also have a future impact on reforms to the ICAC Act as well as future national ICAC styled legislation which has been the subject of recent consideration.

Until the High Court hands down its judgment, there will be a degree of ambiguity surrounding these aspects of the concept.  As the Chief Judge noted in the case, the definition of corrupt conduct ‘is wide and in a number of respects unclear’.

Despite this, Bathurst CJ provides some helpful guidance to public officials on the general nature of corrupt conduct worth remembering:

the unifying idea is that in the interest of honest and impartial exercise of official functions by public officials any conduct adversely affecting such exercise is prima facie to be regarded as corrupt….

There are some other general ramifications from the decision also, such as the likelihood that ICAC will respond to Basten JA’s criticisms of ICAC not having any prosecution guidelines:

Just as directors of public prosecutions in most jurisdictions publish guidelines allowing a degree of transparency with respect to prosecutorial decisions, one might expect the Commission to publish guidelines as to the circumstances in which it holds public inquiries. No such guidelines were in evidence.

The year ahead is likely to yield a fair amount of public discourse on corrupt conduct with the High Court’s decision on this matter due in June 2015, as well as the wash up from various other corruption controversies such as the Royal Commission into Trade Union Governance and the continued allegations of corrupt conduct being referred to ICAC in NSW.

Click here to view table.