Allatech v Construction Management Group - [2002] NSWSC 723

CITATION: Allatech v Construction Management Group [2002] NSWSC 723

CURRENT JURISDICTION: Equity

FILE NUMBER(S): SC 1053/02

HEARING DATE(S): 26 July and 6 August 2002

JUDGMENT DATE: 15 August 2002

PARTIES :

Allatech Pty Ltd (P)
Construction Management Group Pty Ltd (D1)
Peter Hillig (D2)

JUDGMENT OF: Austin J

COUNSEL : A Spencer (P)
M Jacobs QC (D)
J T Johnson (D2)

SOLICITORS: Harris & Company (P)
James Legal (D1)
Watson Mangioni (D2)

CATCHWORDS: EVIDENCE - legal professional privilege - waiver of privilege - whether tender of a single written advice waives privilege with respect to all other advices on the same subject matter - whether voluntary administrator's statement in report to creditors that company had 'good prospects' in litigation waived company's privilege with respect to advice on that subject

LEGISLATION CITED: Corporations Act 2001 (Cth) ss 437B, 439A, 445D
Evidence Act 1995 (NSW) ss 118, 122

CASES CITED: Ampolex Ltd v Perpetual Trustee Co (Canberra) Ltd (1996) 40 NSWLR 12
BT Australasia Pty Ltd v State of New South Wales (No 7) (1998) 153 ALR 722
Fort Dodge Australia Pty Ltd v Nature Vet Pty Ltd [2002] FCA 501
Garratts Ltd v Thanga Thurai [2002] NSWSC 39
McCabe v British American Tobacco Australia Services Ltd [2002] VSC 112

DECISION: Application for access to legal advice denied.

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

AUSTIN J

THURSDAY 15 AUGUST 2002

1053/02 ALLATECH PTY LTD V CONSTRUCTION MANAGEMENT GROUP PTY LTD & ANOR

JUDGMENT

1 HIS HONOUR: This is a hotly contested proceeding in which the proprietor under a building contract, Allatech (the plaintiff), seeks to set aside a deed of company arrangement entered into by the builder, CMG (the first defendant). Mr Hillig, who was the voluntary administrator of CMG and is now the administrator under the deed, is the second defendant.

2 This judgment, one of a substantial number of judgments on interlocutory issues, deals with an application by Allatech for access to a memorandum of advice dated 14 October 1999, prepared by senior and junior counsel for CMG ("the Advice"). The Advice relates to a proceeding brought in this Court by Franks Centre Lofts Pty Ltd against CMG with respect to another building project. Franks Centre Lofts is one of a number of companies, including Allatech, controlled by Mr Curtis Mann. In the absence of orders confining access to Allatech's legal advisers, an order granting Allatech access to the Advice would effectively be an order granting access to Franks Centre Lofts as well.

3 I have read the Advice, for the purpose of dealing with Allatech's application for access to it. It contains a detailed analysis of the facts and law relating to that proceeding, an assessment of CMG's prospects of success, recommendations (including strategic and tactical recommendations) as to the preparation of the case for hearing and the conduct of the litigation, and advice in relation to threatened interlocutory motions. It is a document of 34 pages. It contains a frank and open assessment…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Allatech v Construction Management Group

Details

AGLC: Allatech v Construction Management Group [2002] NSWSC 723
Case: [2002] NSWSC 723
Decision Date: 15 August 2002

CaseChat Overview and Summary

The case involved a dispute between Allatech and Construction Management Group. Allatech was a company that had appointed a voluntary administrator, and Construction Management Group was involved in litigation with Allatech. The dispute centred around the issue of legal professional privilege and whether the waiver of privilege with respect to one piece of advice also applied to other advice on the same subject matter. Specifically, the issue was whether the tender of a single written advice to the voluntary administrator waived privilege with respect to all other advice on the same subject matter. Additionally, the court had to determine whether a statement made by the voluntary administrator in a report to creditors that the company had 'good prospects' in litigation waived the company's privilege with respect to advice on that subject.

The court had to decide two legal issues. Firstly, whether the tender of a single written advice to the voluntary administrator waived privilege with respect to all other advice on the same subject matter. Secondly, whether a statement made by the voluntary administrator in a report to creditors that the company had 'good prospects' in litigation waived the company's privilege with respect to advice on that subject. The court had to consider the principles of legal professional privilege and whether the waiver of privilege was limited to the specific advice that was tendered or whether it extended to all advice on the same subject matter.

The court found that the tender of a single written advice to the voluntary administrator did not waive privilege with respect to all other advice on the same subject matter. The court held that the waiver of privilege was limited to the specific advice that was tendered. The court also found that a statement made by the voluntary administrator in a report to creditors that the company had 'good prospects' in litigation did not waive the company's privilege with respect to advice on that subject. The court held that the statement was not advice and did not fall within the scope of legal professional privilege. The court found that the statement was a factual observation rather than advice and did not constitute a communication between the company and its legal advisers.

The court ordered that the tender of a single written advice to the voluntary administrator did not waive privilege with respect to all other advice on the same subject matter. The court also ordered that a statement made by the voluntary administrator in a report to creditors that the company had 'good prospects' in litigation did not waive the company's privilege with respect to advice on that subject. The court held that the principles of legal professional privilege were not violated in this case.

Orders