NSW Drug search on car.

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22 January 2020
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Last night I was sitting in my car without the car turned on and keys were in my hands when an unmarked cop car rocked up beside me. Turned his lights on and then hopped out to question why I was driving on an suspended licence.
Long story short, service nsw were still in process of updating records and prematurely told me all was well. (Let off with a warning).
However while I was talking to two cops the third one went to speak to my passenger and asked for his licence as well. He did a search on him and discovered that there were historic drug charges (about 5 years ago) and then proceeded to use this as a reasonable justification to search my car.
I allowed the search of my car and of myself (all came back with nothing, mate was found with some ice on him) but I was left wondering if they are even allowed to have stopped me in the first place given that I wasn’t actually driving, the keys were in my hand and not in the ignition, the weak excuse to search for drugs (my passengers history, not mine) and then told me they will text me a email address to send my drs report saying I can drive again (was medically suspended but cleared, so happy to produce report- IF LEGALLY REQUIRED) to them within 5 days. However I’ve not received any texts and times ticking for their deadline.
Left quite confused about the legality of their actions and wondering what to do, next steps.