"Firstly, I wish to apologise for the delay in acknowledging your request under the Freedom of Information Act 1982 (the FOI Act). I was unexpectedly away from the Office last week and was unable to effectively handover my caseload during my period of absence."

The FOI request was delivered on 17 January 2022.

Even if Caitlin was "unexpectedly away from the Office last week", Caitlin's excuse doesn't explain why a formulaic response (see, for example, https://www.righttoknow.org.au/request/r...) acknowledging receipt of an FOI request was not sent from 18 January to 30 January 2022 (14 days), or why a formulaic response to an FOI request required an effective "handover" of Caitlin's "caseload". It's just a copy and paste email from a generic mailbox ...

I take issue with the access decision.

Original request

On 17 January 2022, I requested access to:

Other than the Work Practice Manual for complaint management (January 2019) or the Agency Guide to the PID Act (Version 2), I request access to any operational or administrative documents that set out how approaches about inadequately investigated internal disclosures under the Public Interest Disclosure Act 2013 are handled by the Office of the Commonwealth Ombudsman.

Staff in the OCO found an administrative or operational document that fell within the scope of this request.

Mr Parkhurst, the decision maker, refused access to the document on the basis of s 47 of the FOI Act.

Section 47(1) of the FOI Act provides:

A document is an exempt document if its disclosure under this Act would disclose:

a) trade secrets; or
b) any other information having a commercial value that would be, or could reasonably be expected to be, destroyed or diminished if the information were disclosed.

It would appear that Mr Parkhurst is relying on s47(1)(b) of the FOI Act to claim an exemption. I have formed this view because:

a) Mr Parkhurst does not once refer to “trade secrets” in his reasons for decision; and
b) Mr Parkhurst does explicitly refer to “information of a commercial value”, and “commercially valuable information”, and ”information which has a commercial value for the purposes of s 47(1)(b)”, and the “intrinsic commercial value” of information in the document, and information having a “commercial value”.

Finally, Mr Parkhurst concludes “[f]or these reasons, I have refused access to the requested document under s 47(1)(b) of the FOI Act.”

The relevant law

The relevant law upon which Mr Parkhurst claims that the document is exempt if s 47(1)(b) of the FOI Act.

Analysed, the relevant provision provides that a document is exempted from disclosure if:

a) information is contained in the document; and
b) the information in the document is information other than trade secrets; and
c) the information other than trade secrets has commercial value; and
d) if information other than trade secrets is disclosed, its commercial value would, or could reasonably be expected to, be destroyed or diminished.

The relevant document

The relevant document is either an administrative or operational document “that sets out how approaches about inadequately investigated internal disclosures under the Public Interest Disclosure Act 2013 are handled by the Office of the Commonwealth Ombudsman”. That is known because the document was identified by reference to the scope of the access request.

Criticisms of the reasons for decision

Mr Parkhurst’s reasons for decision are, in some measure, bewildering and erratic. I will attempt to, as best as I am able to, makes sense of Mr Parkhurst’s line of reasoning.

As best as I am able to understand, Mr Parkhurst claims that the relevant document:

i) “contains highly detailed information about the use of certain record keeping and case management computer system software operated by the Commonwealth Ombudsman”;
ii) “contains numerous images showing the use of the relevant computer system at certain stages in the handling of certain matters under the Public Interest Disclosure Act 2013 and the Ombudsman Act 1976”;
iii) “contains materials describing in detail the use of a computer system designed by the relevant provider of information technology products and services for the purpose of managing complaint and investigation work performed by the Commonwealth Ombudsman”.

As charitably as I am able to construe his reasons, Mr Parkhurst claims that the information in the document, which is information other than trade secret information, has commercial value.

To be exempt under s 47(1)(b), a document must satisfy two criteria:

a) the document must contain information that has a commercial value either to an agency or to another person or body; and
b) the commercial value of the information would be, or could reasonably be expected to be, destroyed or diminished if it were disclosed (FOI Guidelines [5.204]).

Commercial value to “an agency” – the Office of the Commonwealth Ombudsman

It is difficult to argue that the document has a commercial value for the OCO on the basis of the reasons provided by Mr Parkhurst.

At this juncture, it is useful to note that, historically, the substance of s 47(1)(b) was contained in s 43(1)(b). Section 43(1)(b) was repealed and was re-enacted as s 47(1)(b). The terms of s 47(1)(b) are identical to the repealed s 43(1)(b).

As the Full Court of the Federal Court found in Secretary, Dept of Workplace Relations & Small Business v The Staff Development & Training Centre Pty Ltd [2001] FCA 1375, [29]:

Section 43(1)(b) is designed to extend exemption from disclosure to information having commercial value that does not qualify as a trade secret. His Honour considered that, to attract the exemption provided by s 43(1)(b), the information must not merely have value to the Department. That value must also be able to be described as commercial in character. The fact that the exemption is an extension of the exemption provided for in respect of trade secrets indicates that the information must have value to the Department in respect of those of its activities which can be said to bear a commercial, as opposed to an administrative or governmental character. His Honour concluded, therefore, that the Tribunal was incorrect in finding in the words of s 43(1)(b) requirement that the information have exchange value. However, for the reasons given for holding that the information, in so far as it may qualify as secret nevertheless cannot qualify as a trade secret, the information, whatever value it may have to the Department, cannot be said to have a value “commercial” in character.

It is difficult for me to accept that a document that:

i) “contains highly detailed information about the use of certain record keeping and case management computer system software operated by the Commonwealth Ombudsman”; and
ii) “contains numerous images showing the use of the relevant computer system at certain stages in the handling of certain matters under the Public Interest Disclosure Act 2013 and the Ombudsman Act 1976”; and
iii) “contains materials describing in detail the use of a computer system designed by the relevant provider of information technology products and services for the purpose of managing complaint and investigation work performed by the Commonwealth Ombudsman”,

is of any commercial value to the Office of the Commonwealth Ombudsman.

No doubt the information is of value to the Office of the Commonwealth Ombudsman in undertaking tasks of an administrative or governmental character, but that is hardly the point. The information must be of commercial value to the Office of the Commonwealth Ombudsman. No reasonable person could claim that information about the handling of matters under the Public Interest Disclosure Act 2013 or the Ombudsman Act 1976 is of a commercial character. Nor could a reasonable person claim that information contained in an administrative or operational document to facilitate the management of “complaint and investigation work performed by the Commonwealth Ombudsman” is of a commercial character.

Thus, the document identified by Mr Parkhurst could not be said to contain information that has a commercial value for the Office of the Commonwealth Ombudsman.

Commercial value to “an agency” – agencies other than the Office of the Commonwealth Ombudsman

Mr Parkhurst claims that the relevant administrative or operational document “contains materials describing in detail the use of a computer system designed by the relevant provider of information technology products and services for the purpose of managing complaint and investigation work performed by the Commonwealth Ombudsman”. Mr Parkhurst also claims “[t]he relevant provider of information technology products and services to the Ombudsman has drawn on its extensive expertise and experience to design and develop the computer system described and depicted in the requested document”. It would seem that the information in the relevant administrative or operational document is about a bespoke computer system designed and developed for the purpose of managing complaint and investigation work performed by the Commonwealth Ombudsman.

It is not clear what commercial value a program designed and developed for the purpose of managing complaint and investigation work performed by the Commonwealth Ombudsman, particularly in respect of handling matters under the Public Interest Disclosure Act 2013 and the Ombudsman Act 1976, would have for other agencies. More to the point, it is not clear what commercial value:

a) “images showing the use of the relevant computer system at certain stages in the handling of certain matters under the Public Interest Disclosure Act 2013 and the Ombudsman Act 1976”; or
b) “highly detailed information about the use of certain record keeping and case management computer system software operated by the Commonwealth Ombudsman”; or
c) Information “describing in detail the use of a computer system designed by the relevant provider of information technology products and services for the purpose of managing complaint and investigation work performed by the Commonwealth Ombudsman”,

would have for any other agency of the Commonwealth.

It is possible that the information in the relevant administrative or operational document may have value for State or Territory Ombudsman but that value must be of a commercial character. Much like the Commonwealth Ombudsman, the State and Territory Ombudsmen are engaged in governmental work and the value of any information in the relevant administrative or operational document will be administrative or governmental; it will not be commercial.

Given the bespoke nature of the computer system designed and developed for the purpose of managing complaint and investigation work performed by the Commonwealth Ombudsman, the information in the document identified by Mr Parkhurst could not be said to contain information that has a commercial value for other agencies. Moreover, if the information in the document identified by Mr Parkhurst does have value for the Offices of the Ombudsmen of the States and Territories, it cannot reasonably be said to have commercial value for the Offices of the State and Territory Ombudsmen.

Commercial value of the information to others

As I have already noted, as charitably as I am able to construe his reasons, Mr Parkhurst claims that the information in the document, which is information other than trade secret information, has commercial value. I assume that Mr Parkhurst means that the information has a commercial value for someone other than the Office of the Commonwealth Ombudsman or other agencies.

In the reasons for his decision, Mr Parkhurst states “I am of the view that disclosure of the information contained in the requested document would disclose commercially valuable information to the competitors of the relevant provider of information technology products and services.” I take it that Mr Parkhurst is of the view that the information in the relevant document has commercial value for the developer of the “computer system designed … for the purpose of managing complaint and investigation work performed by the Commonwealth Ombudsman”, as well as that developer’s competitors in the market.

In support of the claim that the information has commercial value to the developer of the computer system, as well as the developer’s competitors, Mr Parkhurst claimed that he had “taken into account that the information contained in the relevant document is known only to the Commonwealth Ombudsman and a provider of certain information technology products and services to the Ombudsman’s Office.” Presumably, Mr Parkhurst has made this claim in response to one of the factors that may assist in deciding in a particular case whether information has a commercial value (see FOI Guidelines [5.205]). The relevant factor is “whether the information is known only to the agency or person for whom it has value or, if it is known to others, to what extent that detracts from its intrinsic commercial value.”

Mr Parkhurst claimed that the developer of the computer system was designed and developed for the purpose of managing complaint and investigation work performed by the Commonwealth Ombudsman, particularly in respect of handling matters under the Public Interest Disclosure Act 2013 and the Ombudsman Act 1976. Presumably the development of the computer system was the subject of a call or tender to market.

In procuring a computer system that Mr Parkhurst claims the developer has “contributed significant effort and resources to develop”, one would expect that the Office of the Commonwealth Ombudsman complied with the Commonwealth Procurement Rules (the CPR), made pursuant to the Public Governance, Performance and Accountability Act 2013 (Cth).

The CPR set out the rules that officials must comply with when they procure goods and services: rule 3.1. When procuring goods and services, agencies will prepare “request documentation”. According to rule 10.6 of the CPR, request documentation must include a complete description of:

a) the procurement, including the nature, scope and the quantity of the goods and services to be procured or, where the quantity is not known, the estimated quantity, and any requirements to be fulfilled, including any technical specifications, conformity certification, plans, drawings, or instructional materials;
b) any conditions for participation, including any financial guarantees, information and documents that potential suppliers are required to submit;
c) any minimum content and format requirements;
d) evaluation criteria to be considered in assessing submissions and, if applicable to the evaluation, the relative importance of those criteria;
e) any dates for the delivery of goods or supply of services, taking into account the complexity of the procurement; and
f) any other terms or conditions relevant to the evaluation of submissions.

In certain circumstances, rule 10.6 does not apply, but there is no suggestion that is the case in this instance. I would be assuming too much to conclude as much.

“Officials must, on request, promptly provide, to eligible potential suppliers, request documentation that includes all information necessary to permit the potential supplier to prepare and lodge submission”: rule 7.16.

Assuming that the procurement was by way of open tender, it seems to me that the claim that “the information contained in the relevant document is known only to the Commonwealth Ombudsman and a provider of certain information technology products and services to the Ombudsman’s Office” is dubious. Both the developer and the developer’s competitors would have had access to the parameters set by the Office of the Commonwealth Ombudsman in respect of the way the computer system would have to operate to meet the needs of the Office of the Commonwealth Ombudsman. Accordingly, the information contained in the relevant document would not be “information known only to the agency or person for whom it has [commercial] value.” It’s quite possible that the information contained in the document is known to the developer’s competitors.

Mr Parkhurst has not addressed whether request documentation was available to potential suppliers, including the developer’s competitors. Mr Parkhurst has not addressed to what extent the commercial value of the information in the relevant document was detracted from on the basis of the knowledge the developer’s competitors had, or could have had, or could have, of any request documentation. Mr Parkhurst has made a bald assertion about the commercial value of the information in the relevant document to the developer and the developer’s competitors. That is hardly satisfactory for reasons crafted by a senior legal officer in the Office of the Commonwealth Ombudsman. In any event, it does not engender confidence that the decision was a considered and thoughtful one; the reasons are weak.

Another factor that may assist in deciding in a particular case whether information has commercial value is whether the information confers a competitive advantage on the agency or person to whom it relates — for example, if it lowers the cost of production or allows access to markets not available to competitors: FOI Guidelines, [5.205]. This factor was not addressed by Mr Parkhurst, and with good reason. It could not be argued that pictures of a computer system or information about the use of the system confers a competitive advantage on the developer of the computer system.

Another factor that may assist in deciding in a particular case whether information has commercial value is whether a genuine ‘arm’s-length’ buyer would be prepared to pay to obtain that information: FOI Guidelines, [5.205]. This is a factor that Mr Parkhurst did not address. It is questionable that a genuine ‘arm’s-length’ buyer would be prepared to pay for pictures of what I take to be the graphical user interface of the computer system (complaint management software) or information about its use. Why would a genuine ‘arm’s-length’ buyer pay for a picture of a graphical user interface or the way the system operates when the genuine ‘arm’s-length’ buyer could go the Office of the Commonwealth Ombudsman and ask the Office for the parameters that it set for tenderers to answer. It does not strike me as plausible that such information would have any commercial value to a competitor of the developer of the computer system.

Another factor that may assist in deciding in a particular case whether information has commercial value is whether the information is still current or out of date (out of date information may no longer have any value): FOI Guidelines, [5.205]. Mr Parkhurst did address this criterion. In the reasons for his decision, Mr Parkhurst stated:

I have also taken into account the age of the information contained in the requested document. The Commonwealth Ombudsman is currently using the relevant computer system for a range of purposes, including the assessment and investigation of complaints. I understand that the Ombudsman intends to continue using the relevant computer system for the same purposes in the future. For these reasons, I am satisfied that the requested document continues to have commercial value and that this information remains relevant to the ongoing commercial affairs of the relevant provider of information technology products and services.

I accept that the Commonwealth Ombudsman is using the relevant computer system and that the Ombudsman intends to continue using the system in the future. But it is not clear how the use of this system on the part of the Commonwealth Ombudsman has commercial value to the developer of the computer system. If the system was purchased outright, then the developer has taken their money and run. It is not clear if that is the case but that ought to have been addressed by Mr Parkhurst to clarify why the system remained of commercial value to the developer. I might also point out that the Office of the Commonwealth Ombudsman has been using, and continues to use, the “Resolve” system for a lot of its complaints management functions and detailed information about the use of that system has been publicly available on the website of the Office of the Commonwealth Ombudsman for years (in the form of the Work Practices Manual for Complaint Management). While I accept that the disclosure of information about the Resolve system has no bearing on the question of the commercial value of the system Mr Parkhurst has referred to in his reasons for decision, I do question just how sincere Mr Parkhurst has been in his reasons given that comparable information about a system that the Office of the Commonwealth Ombudsman uses for most of its complaints management has been available to the public for at least 2.5 years on the website of the Office of the Commonwealth Ombudsman.

Yet another factor that may assist in deciding in a particular case whether disclosing the information would reduce the value of a business operation or commercial activity — reflected, perhaps, in a lower share price: FOI Guidelines, [5.205]. I do not think this would be the case. If anything, disclosure of images of the graphical user interface may well be a boon to the developer as other agencies might take a liking to the work done for the Office of the Commonwealth Ombudsman. Similarly, information about the way the system works may well engender a liking for the work produced by the developer. Nothing in Mr Parkhurst’s reasons suggests that, for example, the source code for the program has been replicated in the relevant document. If that were the case, one could well understand that the business operation or commercial activity of the developer – and for that matter, a savvy competitor – would be affected by the disclosure of information. In any event, the factor has not been addressed.

Not knowing what is contained in the relevant document, I will do Mr Parkhurst the courtesy of entertaining his claim that the information has commercial value for others. That is not to say I accept what he has claimed uncritically; plainly I have not.

Let it be said, for the sake of argument, that the relevant document contains:

a) “images showing the use of the relevant computer system at certain stages in the handling of certain matters under the Public Interest Disclosure Act 2013 and the Ombudsman Act 1976”; or
b) “highly detailed information about the use of certain record keeping and case management computer system software operated by the Commonwealth Ombudsman”; or
c) information “describing in detail the use of a computer system designed by the relevant provider of information technology products and services for the purpose of managing complaint and investigation work performed by the Commonwealth Ombudsman”.

Whether information having a commercial value would be, or could reasonably be expected to be, destroyed or diminished if the information were disclosed

It is not enough that the document referred to by Mr Parkhurst should contain information that has a commercial value either to an agency or to another person or body. It must also be the case that the commercial value of the information would be, or could reasonably be expected to be, destroyed or diminished if it were disclosed.

What is meant by “would be, or could reasonably be expected to be” in the context of the destruction or diminishment of commercial value of the information is to be given its natural meaning. I appreciate that, in attempting to give that set of words its natural meaning, recourse to authorities on an identical set of words used in another part of the FOI Act would not necessarily delineate the meaning of “would be, or could reasonably be expected to be” in s 47(1)(b) of the FOI Act. Nonetheless, consideration of that set of words used elsewhere (e.g. s 37 of the FOI Act) might usefully inform one’s understanding of what the Parliament may have had in mind when it commanded “[a] document is an exempt document if its disclosure under [the FOI] Act would disclose … any other information having a commercial value that would be, or could reasonably be expected to be, destroyed or diminished if the information were disclosed.” To that end, case law on how that set of words has been construed elsewhere in the FOI Act will be addressed.

At pages 101-102 in The News Corp Ltd v NCSC (1984) 5 FCR 88, which is a judgment of the Full Court of the Federal Court, Justice Woodward stated:

I think that the words "would, or could reasonably be expected to ... prejudice" mean more than "would or might prejudice". A reasonable expectation of an event requires more than a possibility, risk or chance of the event occurring. On the other hand, if the legislature had required a probability of prejudice it could easily have said so. In my view it is reasonable to expect an event to occur if there is about an even chance of its happening and, without attempting to suggest words alternative to those chosen by the draftsman, it is in that general sense that the phrase should be read.

In a similar vein, the set of words “would, or could reasonably be expected to be, destroyed or diminished” would require more than a possibility, risk or chance of the event occurring – namely, destruction or diminishment of the commercial value of information. Otherwise, the Parliament would have said so.

Indeed, as the Full Court of Federal Court stated in Searle Aust v Public Interest Centre (1992) 36 FCR 111, 122 in respect of the words “would, or could reasonably be expected to be, destroyed or diminished” in the context of s 43(1)(b) of the FOI Act, the relevant test is not that there be a possibility not irrational, absurd or ridiculous that the specified consequence occur.

Mr Parkhurst stated that “I am satisfied that disclosure of the requested document to others outside of the relevant provider of information technology products and services, particularly its competitors, poses a risk to the value of the business operations of the relevant provider of information technology products and services.” But Mr Parkhurst has missed the point. It is not that there should be a risk to the value of the business operations of the relevant provider of information technology products and services. There must be a reasonable expectation that the commercial value of the information disclosed in the document would be destroyed or diminished if the document were granted access to.

Mr Parkhurst then jumps from the claim that disclosure of the document (which contains information he claims has commercial value for the developer of the computer system and the developer’s competitors) poses a risk to the value of the business operations of the developer of the computer system to the conclusion that disclosure “would destroy or at least diminish the value of the intellectual property contained in the relevant document.” Even in his conclusion, Mr Parkhurst has missed the point. The relevant issue is whether there is a reasonable expectation that the commercial value of the information disclosed in the document would be destroyed or diminished if the document were granted access to. The relevant issue is not about the destruction or diminution of “the value of the intellectual property contained in the relevant document.” Mr Parkhurst’s conclusion is bewildering, and the line of reasoning employed by the Senior Legal Officer in the Office of the Commonwealth Ombudsman is, to be frank, embarrassing. I will be merciful and will not point out the other embarrassing errors of reasoning.

It is regrettable that such a poorly reasoned decision should have been made by the Senior Legal Officer. I am of the view that Mr Parkhurst’s reasons have not been attended by a level of diligence and care that one might reasonably expect of a person making a decision under the FOI Act. That this should be so is all the more regrettable because Mr Parkhurst is a Senior Legal Officer in an integrity agency.

I will, at an opportune time, request internal review of this decision.