Key published decisions applying Section 49 FOI Act

Cairns Port Authority and Department of Lands; Cairns Shelfco No.16 Pty Ltd (Third Party) (1994) 1 QAR 663

Cairns Port Authority (CPA) sought review of a decision of the Department of Lands (Department) to provide Cairns Shelfco No 16 (Cairns Shelfco) access to parts of a valuation report and draft valuation reports that concerned land vested in the CPA and leased to Cairns Shelfco.

The rent payable under the lease was determinable by two different methods, both based upon figures in valuation reports prepared by the Valuer-General pursuant to section 27 of the Valuation of Land Act 1944 (Qld). [11] CPA refused access to the relevant matter under a number of provisions, including sections 49 and 45(1)(c) of the FOI Act.

Could disclosure reasonably be expected to have a substantial adverse effect on the financial or property interests of the State or an agency?

Financial or property interests

The Information Commissioner was satisfied that adverse effects on the ‘business, professional, commercial or financial affairs’ of an agency, under section 45(1)(c) of the FOI Act, were equally applicable to the phrase ‘financial or property interests’ under section 49 of the FOI Act. [146]

Substantial adverse effect

The phrase ‘substantial adverse effect’ in section 49 of the FOI Act was contrasted with other FOI provisions where the test is merely that of an ‘adverse effect’. The Information Commissioner was satisfied that while the phrase ‘adverse effect’ means an effect that is ‘real’, ‘actual’ or ‘having substance, not illusory’, the phrase ‘substantial adverse effect’ means that the adverse effect must be substantial; ‘grave, weighty, significant or serious’. [150]

CPA made two submissions concerning the ‘adverse effect’ of disclosure under section 45(1)(c) of the FOI Act:

1. that the lessee would likely commence litigation to challenge the valuations and CPA could reasonably be expected to suffer unrecoverable legal costs from that litigation

2. that CPA would have a commercial disadvantage in negotiating leases with prospective tenants.

In respect of the fist submission, that Cairns Shelfco would mount litigation to challenge the valuation report, the Information Commissioner was satisfied that, according to the ordinary meaning of section 45(1)(c), litigation in respects of a company’s business, professional, commercial or financial affairs would constitute an adverse effect on those affairs. [104] However, it was noted that section 45(1)(c) has a public interest balancing test; even if there was a reasonable expectation of a substantial adverse effect on the financial or property interests of CPA, disclosing the matter would be in the public interest. [104] It would be repugnant to the public interest if the assertion of legal rights and remedies in a court of law constituted an adverse effect worthy of protection under FOI legislation. [103] Nonetheless, the Information Commissioner was satisfied that there was no evidence to support a reasonable expectation of litigation being commenced by Cairns Shelfco. [129]

In relation to CPA’s second submission, the Information Commissioner found that disclosing the relevant matter could not reasonably be expected to have an adverse effect on CPA’s ability to negotiate a favourable lease because a lease agreement already existed between Cairns Shelfco and CPA. [134] However, a different situation might arise where valuation reports were disclosed while the landholder was in the process of negotiating a favourable lease. [134]

If there is no reasonable expectation of an ‘adverse effect’ under section 45(1)(c) of the FOI Act, the Information Commissioner was satisfied that there could be no reasonable expectation of a ‘substantial adverse effect’ under section 49 of the FOI Act. [146]

Accordingly, the relevant matter was not exempt under section 49 of the FOI Act.

Little; Cantoni and Department of Natural Resources (1996) 3 QAR 170

The applicants sought access to parts of a valuation report concerning the applicants’ land, which was prepared for the purpose of State acquisition (Report). The Department of Natural Resources (Department) refused access under a number of provisions including section 49 of the FOI Act. Specifically, the relevant matter consisted of: [5]

  • the valuation figure for the land (and other valuation figures for portions of the land and other items)
  • the methodology and reasoning upon which the valuation was based; and
  • executive summary identifying relevant issues to the acquisition proposal.

Could disclosure reasonably be expected to have a substantial adverse effect on the financial or property interests of the State or an agency?

The Department contended that disclosing parts of the Report, without mutual exchange of the landowners’ valuation, would give the applicant landowners an unfair negotiating advantage because the applicants would be able to put the Department’s valuation to critical analysis. [42] The Department submitted that any increased price of the land, as a result of the biased negotiations, would have a substantial adverse effect on the financial interests of the agency. [44] Nevertheless, the Information Commissioner found that disclosing the matter could not reasonably be expected to have a substantial adverse effect on the Department because:

  • a detailed analysis of the Report would support the objective of determining fair and just compensation for the acquisition of land [49]
  • the Department already has a distinctly superior bargaining power when conducting negotiations in the open market because agencies can rely on the Acquisition of Land Act 1967 (Qld) to obtain possession if a transaction cannot be finalised through negotiation [50]
  • disclosing the valuation Report though the FOI regime would not cause the Department procedural unfairness in later Land Court proceedings. [51]

Accordingly, there were no real or substantial grounds raised by the Department to support the conclusion that disclosing the relevant matter could reasonably be expected have an adverse effect on the financial interests of the Department, let alone a substantial adverse effect. [61]

Would disclosure, on balance, be in the public interest?

The Information Commissioner was satisfied there is no public interest in saving public money if it means that negotiations for acquisition would occur on less than just terms. As acquisition is one of the government’s most intrusive powers, there is a greater public interest, common to all citizens, in ensuring acquisition occurs on just terms. [47-48]

The Department also submitted that nondisclosure of the valuation Report was in the public interest because disclosure by a registered valuer, namely the Valuer-General’s Office, amounts to a breach of statutory confidence to the client. The Information Commissioner dismissed this submission because valuers employed as officers of Departments are not subject to section 6 of the Valuers Registration Regulation. [55] Further, no duty of confidence is generally owed by a client in possession of a valuation Report prepared for the client’s purposes. [55]

Accordingly, the relevant matter was not exempt under section 49 of the FOI Act.

Seeney, MP and Department of State Development; Berri Limited (Third Party) (2004) 6 QAR 354

The applicant sought access to information concerning the grant of financial assistance by the State, to the third party Berri Limited, under the Queensland Investment and Incentive Scheme (QIIS). The Department of State Development (Department) refused access to some relevant matter under a number of provisions, including section 49 of the FOI Act. Specifically, the relevant matter consisted of the dollar amount of financial assistance given to the third party and a memorandum about the third party’s business activities.

Could disclosure reasonably be expected to have a substantial adverse effect on the financial or property interests of the State or an agency?

The Department submitted that disclosing the dollar amount of financial assistance provided to the third party would have a substantial adverse effect on the financial interests of the Department or the State. Specifically, the Department submitted that disclosure would:

  • set a precedent for other potential investors who could use the benchmark dollar amount to strengthen their negotiation position against the States
  • discourage other investors from investing in Queensland
  • make the QIIS program less financially effective
  • give other States a commercial advantage in securing potential investment.

While the Department made a ‘class claim’ that all dollar amounts of financial assistance were exempt from disclosure, the Information Commissioner was satisfied that section 49 required an assessment of the actual matter in issue and whether disclosure could reasonably be expected to have the substantial adverse effects described by the Department. [117]

Whether matter is exempt may be determined by the circumstances of each case. In relation to disclosing the dollar amounts of financial assistance, the Information Commissioner considered: [117]

  • the time passed since the financial grant
  • whether other states were competing for the project
  • whether the disclosure has a limited general application or precedent value.

The Information Commissioner was satisfied that disclosing the relevant matter could not reasonably be expected to have a substantially adverse effect on the Department or State because:

  • three years had passed since the financial grant to the third party [106]
  • the Department was free to negotiate each application for financial assistance on its own merits and would not be bound to follow previous grants offers [110]
  • it was mere speculation that investors would be discouraged from investing in Queensland [111]
  • while there could be situations where grants information should be secret for a time to ensure that other States cannot out-bid Queensland for investment projects, the present case was not such a situation. [115-116] It was also noted that there are a number of other factors that influence an investor’s decision to invest in Queensland. [113]

The Information Commissioner found that disclosing a memorandum concerning the business activities of the third party could not reasonably be expected to have a substantial adverse effect on the financial interests of the State or Department because the contents of the memorandum were already available in the public domain. [136]

Accordingly, the relevant matter was not exempt under section 49 of the FOI Act.

Halcyon Waters Community Pty Ltd and Gold Coast City Council (Unreported, Queensland Information Commissioner, 14 September 2009)

The applicant sought access to documents concerning the Gold Coast City Council’s (Council) acquisition of Hope Island land. The applicant was not the owner of the land subject to acquisition. Council refused access to one particular document under section 49 of the FOI Act on the basis that disclosing the document could reasonably be expected to have a substantial adverse effect on the financial and property interests of the State and Council. Specifically, the relevant matter was contained in the minutes of a Council meeting and could be described as:

  • a dollar amount, per hectare, valuation of the land
  • a dollar amount valuation of the entire land; and
  • a dollar amount representing Council’s available funding for the acquisition.

Could disclosure reasonably be expected to have a ‘substantial adverse effect’ on the ‘financial or property interests’ of the State or an agency?

Is there an expectation of a ‘substantial adverse effect’?

Even though the relevant matter was neither specific to the applicant’s land nor contained in a valuation report, the Assistant Commissioner was satisfied the principles from the decision in Little7 were still relevant.

The Assistant Commissioner found that Council must identify the nature of the substantial adverse effect that disclosing the relevant matter could reasonably be expected to have. [44] Council asserted that disclosure would provide the applicant with a financial advantage in any negotiations for acquisition of the applicant’s land, which would result in Council paying more than it normally would be able to negotiate. Council also submitted that prematurely disclosing the relevant matter could prevent Council from negotiating viable prices for the Hope Island land and other land which would put the construction project in jeopardy. [45]

The Assistant Commissioner was satisfied there was no evidence to support a finding that disclosure could reasonably be expected to have the adverse effects described by Council. [49]

Would disclosure, on balance, be in the public interest?

The Assistant Commissioner was satisfied that disclosure was in the public interest and the public interest considerations identified in Little, concerning the acquisition of land, should be given substantial weight. [50] The intrusive nature of acquisition means that the process of acquisition should be transparent. [48] Since the acquisition of private property could potentially affect any citizen, there is no public interest in saving public money if it means that negotiations for acquisition would occur on less than just terms. [48] The public interest factors favouring nondisclosure, including the potential waste of public monies, were outweighed by the factors favouring disclosure. [52]

Accordingly, the relevant matter was not exempt under section 49 of the FOI Act.

7Little; Cantoni and Department of Natural Resources (1996) 3 QAR 170.

Last updated: March 5, 2012