Kerr’s correspondence with the Palace on the Loans Affair prosecution … Shifting claims of Crown privilege … Resignation of attorney general Ellicott … The GG away at the opera when the executive council agreed to raise $4 billion in petrodollars … The Queen didn’t much like Alan Reid’s unbalanced opinions … Send me another book, please … Kerr’s views on Neville Wran … Stephen Murray delves into remote corners of the Palace Letters
The Fraser cabinet’s agreed position on the private prosecution ultimately saw Attorney General Bob Ellicott QC resign as a minister.
However, Kerr thought that if Ellicott had his way in interviewing key government officials on the events leading up to the Executive Council meeting of December 13, 1974, he may well have come to the view not to proceed with the prosecution.
On October 26, 1976, Kerr wrote to the Queen’s private secretary Martin Charteris, to alert him to “a peculiar piece of litigation of a rather complex nature” being undertaken in Queanbeyan.
He said a private citizen had laid informations alleging conspiracy against the four ministers who signed the “famous Executive Council Minute”.
At that meeting Prime Minister Gough Whitlam, Deputy Prime Minister and Treasurer Jim Cairns, Minerals and Energy Minister Rex Connor and Attorney General Lionel Murphy gave approval to secure a loan of up to $4,000 million.
Kerr was not present at the meeting having taken to Sydney for an engagement at the opera that evening, a point he was at pains to make in a letter to the Palace on July 21, 1975.
In the October 1976 letter, Kerr reported that:
“The first conspiracy alleged was a conspiracy to effect a purpose unlawful under a law of the Commonwealth, namely the obtaining of a loan … without the approval of the Loan Council. The second conspiracy was a conspiracy to deceive the Governor General, involving the same facts, namely the obtaining of such a loan for temporary purposes when it was not for temporary purposes.
How much evidence will be available and how much publicity and drama will be associated with it depends, of course, on many circumstances – for example – what facts are known to the moving party and what can be brought out as a result of subpoenas to produce documents and to give evidence.
There will be important questions for the Crown to decide in relation to Crown privilege and other matters. The Attorney General has these questions under consideration at the present time. A date has been fixed for the hearing, 12 November.”
Kerr enclosed an article on the proceedings in the Australian Financial Review, penned by one Richard Ackland.
Kerr’s writing on the subject finished with:
“It seems that we are going to be able to keep you diverted by our goings-on out here in Australia.”
On November 3, Kerr wrote again on the subject:
“There has been a development in the committal proceedings in which the two alleged conspiracies referred to in my last letter are being investigated.
The solicitor for the informant has been in touch with [Kerr’s private secretary] David Smith, indicating the possibility of subpoenaing him to give evidence about the events of 13 December. He has asked for an interview with David before issuing the subpoena. This has been parried for the time being. I have taken advice from the Attorney General about what David’s attitude should be. He will not grant an interview. If he gets a subpoena we will need advice about a claim of privilege.
The Secretary of the Executive Council and other important officers have received subpoenas, either to produce documents or to give evidence. The Crown is considering its attitude to a claim of Crown privilege because what is being done affects the working of the Executive Council and preparations for its meetings, as well as relevant practices relating to the summoning of the Council. Government House will need careful advice. I shall keep you informed.”
Charteris, in reply, wrote:
“I was of course extremely interested to read about the litigations in Queanbeyan against the four Ministers who signed the Executive Council; from your letter of 3rd November I can see that this may lead to no little difficulty in Government House.”
On August 10, 1977, Kerr raised the issue again, advising that “a rather awkward problem presented itself late last week. The Prime Minister rang me to tell me of a possible crisis.”
The crisis arose from the tabling in parliament by the Whitlam government of a considerable number of documents relating to the Loans Affair, which might ordinarily have been the subject of Crown privilege. Sankey sought to tender those documents in support of his case.
Kerr reported that the Crown had claimed privilege for everything except the documents which had been published. However, prior to Fraser’s departure for London for the Silver Jubilee celebrations, the Cabinet decided to reverse its position that it would not claim privilege for the documents.
Attorney General Ellicott threatened to resign on the issue but the crisis was averted by an agreement to have Cabinet reconsider the matter after the return of everyone from overseas.
Kerr observed that Whitlam, Cairns and Connor had asked that the Attorney General take over the Sankey proceedings with a view to terminating them for lack of evidence and substance.
Kerr said Ellicott was not prepared to do this without speaking to all the officials involved in advising ministers ahead of the Executive Council meeting.
“The attorney by taking this stand ran head on into the principle that governments are not entitled to be given knowledge about the deliberations of and advice given to their predecessors in government. The attorney argued that this principle must give way to the investigation of a possible crime.”
Kerr told Charteris that Ellicott had been rebuffed previously on his request to interview officials by a decision of Cabinet supported by Fraser.
Ellicott threated to resign again especially as he believed, apparently, that if Crown privilege were to be claimed on the documents and he were not allowed to interview officials, the prosecution would fall over for lack of evidence. Ellicott took the view that Cabinet was intruding into his quasi-judicial area.
“In a nutshell it seems that Cabinet wishes to protect Crown privilege to the limit, subject to decisions of the courts; protect the principle of about advice to previous governments being sacrosanct; and probably to get rid of the prosecution. The attorney objects to his own discretions in relation to the criminal law being made the subject of direction.”
Kerr noted that Murphy had taken a position contrary to his former colleagues on having the prosecution taken over by the government. Kerr thought this offered the government a face-saving measure on leaving the prosecution in private hands.
“The attorney could then, I believer, stay in office without problems of conscience on constitutional grounds.
The public servants and most politicians would I think like to be rid of the whole matter of a charge of criminal conspiracy against four former Cabinet members arising out of an Executive Council meeting, but the attorney does not agree that he can be directed to close the prosecution down without investigation.
One question is whether he will in the last resort, if Cabinet stands firm, resign or be forced to go.
I incline to the view, at the moment, that the crisis will pass and the prosecution will remain in private hands.”
By the time Kerr came to write to Charteris on September 8, Ellicott had submitted his resignation as attorney general.
Ellicott made his decision while overseas, and was said by Kerr to be influenced by a Law Ministers Conference in Canada which unanimously asserted their claim to act completely independently in their exercise of discretion in matters of criminal law.
“He apparently came to the conclusion that the matter would have to come to a head on his return and it did,” Kerr wrote.
Ellicott was hamstrung by Cabinet’s decision on refusing him access to officials and the claim of Crown privilege on the documents. Kerr thought Murphy’s position was a help in deciding not to take over the proceedings leaving it to the private prosecutors to challenge the position on Crown privilege.
Ellicott also objected to the government’s refusal to pay the prosecution’s costs though it had agreed to defray the former ministers’ costs. He interpreted all of this as being calculated to ensure the private prosecution was aborted whilst denying him the right to properly consider whether he should take it over.
“The government takes the view that the people decided publically (sic) on 13 December 1975 where the guilt lay on the loan issue and things should be left to rest on that political decision.”
Kerr thought if Ellicott had been allowed to speak to key officials, he would probably have come to the conclusion that there was insufficient evidence to justify continuing the criminal persecution.
He said the clash was between the politicians and bureaucrats who thought the convention that a previous government’s records were sacrosanct and Ellicott, who believed no such convention should inhibit a criminal investigation.
Ellicott referred to being on a collision course with the government, and Kerr thought this meant he realised he could produce no change in Cabinet opinion and that “his discretion was to be bound by political decision”. Kerr thought the constitutional points were of importance to the Palace.
The new attorney general, Peter Durack, escalated the proceedings to the High Court, which ruled the charge of criminal conspiracy over the loan approval was invalid, but rejected the claim of Crown privilege on the documents. The proceedings were eventually dismissed by the Queanbeyan magistrate.
It seems the Queen had only a limited tolerance for the writings of Packer journalist and Labor bête noire, Alan Reid.
In a letter dated July 14, 1977, Kerr notes the Queen had raised with him that she thought it might be useful to have a book that “balanced the opinions” of Reid in his The Whitlam Venture written in the aftermath of the dismissal.
The book had attracted defamation action by Whitlam over claims that he had persisted with attempts at loan raising beyond July 1975.
Kerr told Charteris if Her Majesty was still interested to have such a book, he would select and send a copy.
“There are, of course, many books, now, dealing with the 1975 crisis and its aftermath. I have not found most of them very profitable reading owing to a preponderance of fictional content and ideological attitudes.”
In earlier correspondence, Kerr had sent reviews of books penned by Laurie Oakes and Paul Kelly. He had noted that Fraser did not care much for Oakes, and of the two books, the one by Kelly, The Unmaking of Gough, was preferred. Kerr said of Kelly’s book:
“The best book so far written by a pro-Labor journalist is Paul Kelly’s book, which whilst being unfavourable to me, at least makes some attempt to see things from my point of view. He has gossip, like the others, but he is fairer.”
In the book Kelly speculated that the Queen had been advised that Whitlam’s dismissal was a possibility, but that he had not advised her of his decision until after the event.
Kerr mused that Kelly was drawing conclusions from the frequency with which he was using the diplomatic bag to write “voluminously” to the Palace ahead of November 11.
He had earlier anticipated Reid’s book to be “very supportive”, and forwarded it to the Palace as a “very good new book, well researched but a little turgidly written”. He said it “has a surprising degree of accuracy”.
Kerr’s assessment of Neville Wran, following Wran’s surprise victory in the 1976 NSW Election, makes for interesting reading. Kerr and Wran were acquainted from their time in the industrial bar:
“Mr Wran is an able Queen’s Counsel, who has had a rapid rise in the New South Wales Labor Movement. He had a good practice as a silk, largely in labour cases.
He is not as well educated, generally, and not as brilliant as Mr Whitlam, but he is shrewd, tough and much better balanced. He is not a brinksman.
I have known him for many years and he was once a friend. He has been in the last 10-15 years a close friend of Senator McClelland. His election to government may not help me as it may add to the Labor Party boycott with another Labor Party in power.
He is gentlemanly and smooth but, unlike Mr Whitlam, perhaps a little intellectually superficial.”