ICAC, procedural fairness & misfeasance in public office

Edward Moses Obeid Sr v David Andrew Ipp [2016] NSWSC 1376 (Obeid v Ipp) concerns the rights that must be afforded to persons affected by investigative or judicial proceedings, and decisions of public officials. It is a clear statement about the limits of procedural fairness and the tort of misfeasance in public office.

Edward Moses Obeid Sr v David Andrew Ipp [2016] NSWSC 1376

In Obeid v Ipp four members of the Obeid family sued the Commissioner of the Independent Commission Against Corruption (ICAC) and others including Counsel Assisting the ICAC Geoffrey Watson SC, two ICAC investigators of the ICAC, and the ICAC itself, alleging that they were denied procedural fairness and were victims of misfeasance in public office during ICAC's handling of Operation Jasper.

His Honour Justice Hammerschlag heard the proceedings in the Supreme Court of New South Wales and dismissed the claim.

Operation Jasper

Operation Jasper was an ICAC investigation into the circumstances surrounding a 2008 decision by the Minister for Primary Industries and Minister for Mineral Resources to grant a coal exploration licence in the Bylong Valley, including whether that decision was influenced by Edward Obeid Sr or other members of the Obeid family.

As part of Operation Jasper, ICAC held compulsory private examinations and a public inquiry. Each of the plaintiffs was examined privately and publicly. The ICAC also executed a search warrant at premises occupied by an Obeid family company. During the public inquiry, the Commissioner made a suppression order in relation to a Heads of Agreement.

The Commissioner presented a report on the Operation Jasper investigation to the Presiding Officer of each House of Parliament (the Jasper Report). The Jasper Report said that Edward Obeid Sr and Moses Obeid engaged in corrupt conduct. It made adverse credibility findings about Edward Obeid Sr, Moses Obeid and Paul Obeid.

No denial of procedural fairness absent 'practical injustice'

The plaintiffs claimed that they were denied procedural fairness during the public inquiry. They said that:

  1. they were not provided with a statement of evidence by an ICAC investigator that should have been provided;
  2. there was a gap in ICAC's chain of custody of certain documents, which the plaintiffs said was exculpatory;
  3. Counsel Assisting cross-examined each of the plaintiffs on a false premise and the Commissioner "permitted" this to occur; and
  4. they were unfairly denied the opportunity of addressing certain witness evidence because the ICAC did not disclose to them information going to the witness's credit.

His Honour held that the ICAC must afford procedural fairness to persons who may be adversely affected by its findings. This included the plaintiffs. The plaintiffs were entitled to have an opportunity to deal with adverse information that was credible, relevant and significant to the ICAC's potential findings. However, his Honour held that the plaintiffs were not denied procedural fairness because they did have an opportunity to address matters and had not suffered any 'practical injustice'. After reviewing the case law, the Judge said:

Where the procedure is shown itself to have failed to afford a fair opportunity to be heard, the granting of curial relief is justified unless it can be shown that the failure did not deprive the person of the possibility of a successful outcome... If can be shown that the breach or denial could have no bearing on the outcome and that it was inevitable, relief will be declined as being futile.

Justice Hammerschlag held that the plaintiffs had an opportunity to be heard on each of the matters put to them; that they would not have run a different case had they been provided with or had knowledge of the matters complained of; and that no alternative course open to them could have achieved a different outcome.

As a consequence, this part of their claim failed.

No misfeasance unless public officer; state of mind critical

The plaintiffs also claimed they were victims of misfeasance in public office. They said that:

  1. the Commissioner engaged in misfeasance in public office by exceeding his powers in making a suppression order;
  2. Counsel Assisting engaged in misfeasance in public office by cross-examining each of the plaintiffs on a false premise;
  3. the two ICAC investigators engaged in misfeasance in public office by videotaping documents that were not covered by a search warrant during the execution of that search warrant; and
  4. that the ICAC itself engaged in misfeasance in public office by denying the plaintiffs procedural fairness.

Justice Hammerschlag held that the Commissioner was a public officer. He then considered the mental element of the tort of misfeasance in public office. His Honour said:

… the mental element in the court is satisfied when the public officer engages in the impugned contact with the intention of inflicting injury, or with the knowledge that there is no power to engage in that conduct and it is calculated to produce injury, or where the officer acts with reckless indifference as the existence of power to support the impugned conduct.

His Honour noted that the precise limits of the tort are still undefined. However, his Honour preferred a stringent test: that it is necessary that the officer actually foresaw a risk that the conduct was likely to harm the plaintiff, but proceeded not caring about that risk. His Honour found the Commissioner did not have the mental element, so the claim against the Commissioner failed.

His Honour held that Counsel Assisting did not hold public office, so the plaintiffs' claim against him failed on this first element. His Honour added that there was no basis for a finding that Counsel Assisting knew or turned his mind to the possibility that he was exercising a statutory power, or exceeding a statutory power.

In relation to the two ICAC investigators, his Honour held that while they were members of staff of the ICAC, they were not acting in a position of public office. Again, the plaintiffs' claim failed on this first element. Although it was not necessary to do so, his Honour found that the investigators knowingly acted in excess of power but no damage was suffered. As no damage was suffered, the claims against them also would have failed on that basis.

Finally, his Honour said that in this case, the ICAC itself is not a public officer and did not deny the plaintiffs procedural fairness, so the plaintiff's claim against the ICAC fails. However, his Honour left open the question of whether the ICAC or other organisation could commit the tort in a different circumstance.


Obeid v Ipp is a concise helpful analysis of the law regarding procedural fairness and the tort of misfeasance in public office. The case stands for the proposition that a claim for denial of procedural fairness is unlikely to succeed if the plaintiff:

  1. has an opportunity to be heard on each of the matters put to him or her;
  2. would not have run a different case had they been provided with or had knowledge of the matters complained of; and
  3. had no alternative course open to them that could have achieved a different outcome.

It also clearly demonstrates that a person will not have engaged in misfeasance in public office unless:

  1. they are in fact a public officer; and
  2. they have the requisite mental element of the tort.

The requisite mental element is not settled law. It is clear that the Judge in Obeid v Ipp prefers a stringent test, though His Honour has left open that question. His Honour also left open the possibility that an organisation such as the ICAC could, in different circumstances, have the requisite mental element and itself engage in the tort.

Although it was not determinative in this case, the case also highlights the importance of investigators not exceeding powers.

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