Royal commissioner Heydon rejects calls to stand down from trade union inquiry

Dyson Heydon has dismissed the unions' application that he quit the royal commission into trade union corruption on the ground of “apprehended bias”.

In very brief remarks to the commission, Heydon indicated he would stay on, declaring: “I have considered all the submissions. In my opinion the applications must be dismissed.” He published a 67-page decision outlining his reasons.

Attorney-General George Brandis said that “of course the government is pleased with this decision”. Brandis said Opposition Leader Bill Shorten, the Labor frontbench and the union leadership should “stop trying to run interference on a royal commission that is shining a light on the dark corners of the union movement”.

The unions – which alleged apprehended bias because Heydon had agreed to give a Liberal-sponsored lecture although he later pulled out – have the option of taking the issue to the Federal Court. ACTU secretary Dave Oliver said the commission was “terminally tarnished”. The unions would consult with their lawyers about any further action, he said.

Some in Labor argue that Heydon staying on is the best result for it because any adverse findings about Shorten would be easier to discredit.

Shadow Attorney-General Mark Dreyfus said Labor’s concerns about Heydon’s conduct “have not been satisfied by anything he has said today”.

The test Heydon used for apprehended bias was “whether, by reason of his agreement to speak at the sixth annual Sir Garfield Barwick Address, a fair-minded lay observer might reasonably apprehend that the commissioner might not bring an impartial mind to the resolution of the issues for decision in the commission”.

The summary of Heydon’s reasons said the applicants made two key arguments.

The first was that a fair-minded observer might apprehend bias merely because the commissioner had agreed to deliver a legal speech organised by two lawyers' branches of the NSW Liberal Party. Heydon rejected this for three reasons.

First, the event was a legal address in memory of Australia’s longest-serving High Court chief justice.

“It could not rationally be concluded that a person who merely agrees to give a legal address at such an event, albeit organised by the lawyer branches of the Liberal Party, believes in, supports or has any relevant association with the Liberal Party.”

Second, the union applicants had not explained how there was any logical connection between their argument and the actual issues for determination in the commission.

Third, they had not shown that “a fair-minded lay observer might conclude the commissioner, a highly experienced lawyer and former judge, would not be able to put out of his mind any extraneous or irrelevant matters and deal with the issues impartially”.

The applicants' second main argument was that the observer might apprehend that the commissioner intended, in agreeing to deliver the lecture, to raise or assist in raising funds or support for the Liberal Party.

But when the documents were considered properly, there was “no factual basis to support the argument that a fair-minded lay observer might apprehend any intention on the commission’s part to raise funds or assist in raising funds or generate support for the Liberal Party”.

As well, the applicants’ concession that nothing could be said about the political leanings of the 2014 lecturer, former chief justice Murray Gleeson, also significantly undermined their arguments, according to Heydon.

Heydon twice delayed the timing of his decision about his future before Monday’s announcement.

Earlier on Monday Prime Minister Tony Abbott reiterated that the commission would proceed, whatever Heydon decided. The government had reportedly been discussing possible replacements if he stepped down.

The crisis blew up when it was revealed on August 13 that Heydon was due to give the Barwick address later in the month.

It had been well flagged to Heydon that it was a Liberal-sponsored event, but he subsequently said in a statement at the commission that he “overlooked” this when confirming his attendance.

Heydon announced he was pulling out of the function just after news of his planned speech broke on August 13 in Fairfax Media. Earlier that morning he had told organisers he would not be able to deliver the lecture if it could be portrayed as a Liberal event. This notification was said to have been given before any media inquiries.

The Australian revealed last week that, on August 12, Marcus Priest, a lawyer and former journalist and former Labor staffer, had inquired of the NSW Bar Association about Heydon’s planned speech.

This led to the association staffer – concerned the story might hit the media – emailing the counsel assisting the commission, Jeremy Stoljar, asking whether Heydon was aware of the event’s Liberal links.

Stoljar asked Heydon who, in their conversation early on August 13, showed Stoljar an email from function organiser Greg Burton dated August 12 saying the event, while Liberal-connected, was not a fundraiser.

The emails between the Bar Association and Stoljar had not been released in the initial material the commission put out. They were only issued after the newspaper report.

The Liberal connections of the event was reiterated in the email trail about the event. Heydon observed in his reasons: “It is notorious among the legal profession that I am incapable of sending or receiving emails. The consequence is that I read emails only after they have been printed out for me.”

The Australian Industry Group said Heydon’s decision “will avoid interruption to the vital work of the royal commission”.

The Greens' industrial relations spokesman, Adam Bandt, said that “agreeing to attend a Liberal fundraiser doesn’t pass the pub test. The commissioner deciding himself that he’s not biased won’t change that.”

Abbott should shut down the commission, Bandt said.

Michelle Grattan does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond the academic appointment above.