Australian Securities and Investments Commission v Lindberg
[2009] VSCA 234
•9 October 2009
SUPREME COURT OF VICTORIA
COURT OF APPEAL
No. 3834 of 2009
| AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION | |
| Applicant | |
| v. | |
| ANDREW ALEXANDER LINDBERG AWB LIMITED | First Respondent |
| Second Respondent |
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JUDGES: | WARREN CJ and NEAVE and MANDIE JJA | |
WHERE HELD: | MELBOURNE | |
DATE OF HEARING: | 18 September 2009 | |
DATE OF JUDGMENT: | 9 October 2009 | |
MEDIUM NEUTRAL CITATION: | [2009] VSCA 234 | |
JUDGMENT APPEALED FROM: | [2009] VSC 330 (Robson J) | |
CORPORATIONS – Civil penalty proceedings – Order requiring applicant to provide documents to non-party - Legal professional privilege – Whether right to an opportunity to assert privilege extends to documents already obtained by ASIC from third persons - Whether leave to appeal required – Australian Securities and Investments Commission Act 2001 (Cth) ss 13, 19.
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| APPEARANCES: | Counsel | Solicitors |
| For the applicant | Mr P J Cosgrave SC with Mr J Moore | Australian Securities and Investments Commission |
| For the 1st Respondent | Ms F Dickinson-Sujee | Galbally & O’Bryan |
| For the 2nd Respondent | Mr C M Scerri QC with Ms S McNicol | Allens Arthur Robinson |
WARREN CJ:
I have had the advantage of reading in draft the reasons for judgment of Mandie JA. For the reasons given by his Honour, I would also grant leave to appeal, if necessary, and allow the appeal.
NEAVE JA:
For the reasons given by Mandie JA I would also grant leave to appeal, if necessary, and allow the appeal.
MANDIE JA:
This is an application for leave to appeal (if leave is necessary) and an appeal by Australian Securities and Investments Commission (‘ASIC’) against orders made by a judge in the Trial Division on 12 August 2009 (following reasons for judgment handed down on 6 August 2009). The orders were made on an application by a non-party to the proceeding, AWB Limited (‘AWB’). The application and appeal were heard on an expedited basis, having regard to the fact that a trial date in the proceeding has been fixed for 19 October 2009. As a result, it is fair to say that the issues before the Court were not fully ventilated either in the written outlines of submissions or in the limited time available for oral submissions (about 3½ hours).
In summary, the orders required ASIC to provide to the external lawyers for AWB copies of certain witness statements (including draft statements) and transcripts of examinations conducted pursuant to s 19 of the Australian Securities and Investments Commission Act 2001 (Cth) (‘the ASIC Act’). The full text of the orders is set out below.
Background to the making of the orders
The principal proceeding, in which these orders were made, is a civil penalty proceeding commenced on 19 December 2007 under the provisions of the Corporations Act 2001 (Cth) (‘the Corporations Act’) that has been brought by ASIC against Andrew Alexander Lindberg, the former managing director of AWB, for alleged contraventions of ss 180 and 181 of the Corporations Act, alleged to have occurred when Mr Lindberg was an officer of AWB and relating to AWB’s wheat trade with Iraq under the United Nations Oil-for-Food Programme.
In August 2007, ASIC commenced an investigation under s 13(1) of the ASIC Act into suspected contraventions of the Corporations Act (and various other legislative provisions) in relation to the affairs of AWB. In the course of the investigation, which is continuing, ASIC has examined numerous witnesses pursuant to s 19 of the ASIC Act and a number of persons have also voluntarily provided witness statements to ASIC.
On 5 June 2009 the trial date was fixed for 19 October 2009.
On 22 July 2009 the judge ordered ASIC to make discovery of all transcripts of examinations conducted under s 19 of the ASIC Act and all other witness statements including draft statements which had not previously been provided to Mr Lindberg, relating to any questions raised by the pleadings in the proceeding.
By interlocutory process filed 31 July 2009 AWB sought orders, inter alia, requiring ASIC to produce to it the s 19 examinations and other statements, before producing them to Mr Lindberg, to enable AWB to review the documents and determine whether they contain communications over which AWB wished to assert a claim of legal professional privilege (‘LPP’).
AWB’s interlocutory process was supported by an affidavit sworn 31 July 2009 by Michael Thomas Von Schoenberg (‘the solicitor’), a partner in the firm of solicitors acting for AWB (Allens Arthur Robinson – ‘AAR’). The solicitor deposed that orders had been made in the proceeding on 5 June 2009 requiring ASIC to file and serve statements of evidence in relation to certain witnesses and that on 22 July 2009 ASIC was ordered to make discovery to Mr Lindberg of all transcripts of examinations conducted under s 19 of the ASIC Act, and all other statements including draft statements which had not previously been provided to Mr Lindberg.
The solicitor further deposed that on 29 July 2009, on instructions from AWB, he sent letters to ASIC and to the solicitors for Mr Lindberg. Those letters were exhibited to the solicitor’s affidavit.
The letter from AAR to ASIC of 29 July 2009 stated, inter alia:
AWB is not aware of the content of the specific statements and transcripts which have been or are to be produced by ASIC, or the identities of the witnesses or examinees to whom they relate. However, AWB is aware that ASIC has examined and received statements from a significant number of former officers and employees of AWB, former legal and other advisers of AWB, and other individuals, who by reason of services they have performed for AWB are or may be in possession of communications that are subject to claims of legal professional privilege (LPP) by AWB that have not been waived (relevant individuals).
The letter went on to mention that it had been judicially recognised, in relation to the Cole Commission of Inquiry, that there were categories of documents relating to the sale of wheat by AWB to Iraq that were protected by LPP and that there was clearly a substantial factual overlay between the inquiries conducted by the Cole Commission and ASIC’s investigation. The letter said that AWB had repeatedly expressed its concern that ASIC would, whether inadvertently or otherwise, receive AWB’s LPP communications in s 19 examinations and/or involuntary statements and that AWB had notified ASIC that AWB did not consent to the disclosure of its LPP communications. The letter then gave various examples of these expressions of concern and notifications. The letter further pointed out that, by orders made by the judge in this proceeding, AWB was committed to a massive discovery exercise at the instigation of ASIC and that in relation thereto ASIC had served notice on AWB that it disputed AWB’s LPP claims in relation to certain notices issued to a number of firms that had formerly acted for AWB and that AWB had issued a Federal Court proceeding in relation to that dispute.
The said letter went on to complain that ASIC had not drawn to the attention of the Court its ‘knowledge that AWB believes there is a serious risk that statements and transcripts relating to the relevant individuals that have already been or are proposed to be produced to [Mr Lindberg], the details of which AWB is not aware of, contain AWB’s LPP communications’.
The solicitor’s affidavit went on to state that AWB understood that ASIC may have interviewed or examined current and former officers and employees of AWB, former lawyers employed by AWB and former external lawyers instructed by AWB (various individuals were named). The solicitor’s affidavit went on to state:
The communications subject to a subsisting claim of LPP by AWB which may be known to relevant individuals, and which AWB considers there is a serious risk may be contained in statements and transcripts relating to relevant individuals, include communications that are relevant to the matters ASIC has been investigating.
Finally, the solicitor’s affidavit exhibited a letter from ASIC to AAR dated 30 July 2009 in which it was stated that ASIC did not agree that AWB had any entitlement to intervene in the proceeding to seek inspection of ASIC’s documents in circumstances where, amongst other things, ASIC had adopted procedures in its investigation designed to avoid the disclosure to ASIC of AWB’s privileged information and that there was nothing to suggest that any privileged information might have been disclosed to ASIC.
Reasons for judgment
In his reasons for judgment, the judge noted that AWB had altered its stance and submitted that it would accept the transcripts and statements being given to Mr Lindberg’s lawyers without AWB having the prior opportunity to inspect them provided that AWB’s lawyers were given the discovered material in order to enable them to assert and test claims for LPP.
His Honour then referred to the solicitor’s affidavit and in the course of doing so to the decision of Gordon J in AWB Ltd v ASIC[1] and to those parts of the judgment of Gordon J in which she summarised the steps taken by ASIC to protect AWB’s LPP in the course of its investigation (without permitting AWB itself to be represented at any examination and without making any provision for such protection in the case of witness statements supplied voluntarily). His Honour noted that ASIC had conceded before him that it could not be absolutely certain that some privileged information may not have slipped through ‘the protocol net’ and would not now be included in the transcripts and statements to be disclosed to Mr Lindberg.
[1][2008] FCA 1877.
His Honour summarised the submissions made by ASIC including that LPP was a rule of substantive law that might be invoked to resist the giving of information or the production of documents and an important common law immunity[2] but that it was not a rule of law conferring individual rights sounding in damages or an injunction. His Honour recorded that ASIC had submitted that the question whether AWB could restrain the disclosure by ASIC of privileged information to Mr Lindberg was to be determined in accordance with equitable principles relating to threatened breaches of confidence but that AWB was unable to identify any privileged information in any of the material which ASIC had been ordered to deliver and therefore had not raised an arguable case that any such material existed. His Honour noted that AWB had described this argument as an example of ‘Catch 22’ because AWB could not protect its rights if it was not permitted to discover whether its privileged communications were being or being threatened to be misused.
[2]Citing Daniels Corporation v ACCC (2002) 213 CLR 543, 552-3.
His Honour noted that ASIC further submitted that there could not be a breach of any equitable obligation of confidence if ASIC disclosed information to Mr Lindberg pursuant to an order of the Court – a fortiori where the disclosure was made subject to both the implied Harman undertaking and a protocol agreed between the parties for the purpose of ensuring the maintenance of confidentiality.
His Honour said that the courts had recognised that LPP includes not only the right to resist giving relevant information or documents but the right to be given a practical and realistic opportunity to assert the privilege in order to resist giving such information or documents. His Honour referred to Commissioner of Taxation v Citibank[3] in which the Full Court of the Federal Court considered the validity of the exercise of a search warrant where the respondent Citibank successfully challenged the copying of documents on the basis that adequate opportunity was not afforded the holder of the privilege to claim that the documents were subject to LPP. French J (as he then was) said that where no practical or realistic opportunity was provided for the assertion and testing of claims of LPP, the purported exercise of the right to copy documents infringed the privilege.
[3](1989) 20 FCR 403.
His Honour noted AWB’s contention that it had not been given a practical and realistic opportunity to assert and test its claims of LPP and that, unless it was given access to the transcripts and statements, it would be left with the unsatisfactory course of following Mr Lindberg’s trial and seeking to intervene if information which was subject to its LPP was sought to be disclosed or misused.
His Honour said that the circumstances indicated that, to date, AWB had not had a practical and realistic opportunity to assert and test its LPP claims and that AWB’s LPP common law rights might not be observed if the transcripts and statements were provided to Mr Lindberg without AWB having a practical and realistic opportunity to assert and test its LPP claims.
In relation to a challenge by ASIC to the Court’s jurisdiction to make the orders sought, His Honour said that the disclosure to Mr Lindberg was being made pursuant to an order of the Court and that the Court had inherent jurisdiction to ensure, insofar as it was reasonable and possible to do so, that the order did not undermine AWB’s LPP. His Honour said that, subject to any claim of public interest immunity, he was disposed to accede to AWB’s application.
His Honour noted that ASIC had submitted that, in any event, the public interest in preventing AWB from accessing s 19 transcripts would prevent their disclosure to AWB and that it was contrary to the public interest for AWB to obtain access to any s 19 transcripts, or statements provided voluntarily to ASIC, in connection with an important and ongoing inquiry into AWB’s affairs and that ASIC said that the transcripts and statements were:
documents in the possession of ASIC of a confidential nature, which record information received by ASIC concerning possible offences or irregularities and recording the possible course of investigations.[4]
[4]His Honour referred to Zarro v ASC (1992) 36 FCR 40, 46 (Lockhart J), approved in ASIC v P Dawson Nominees Pty Ltd (2008) 169 FCR 227 at [48]-[52] (FFC).
His Honour said that ASIC had contended that the disclosure of such documents to AWB would harm the public interest by impeding ASIC’s ability to effectively conduct its investigation into the affairs of AWB, by disclosing to the company whose affairs were the subject of the investigation documents that, alone or together, demonstrated ‘the extent of the information gathered and the directions investigation is or may be taking’.[5]
[5]His Honour referred to ASC v Zarro (No. 2) (1992) 34 FCR 427, 436 (Drummond J).
His Honour noted that ASIC had further submitted that disclosure to AWB of statements which were provided voluntarily to ASIC might have a chilling effect upon ASIC’s ability to secure future cooperation from individuals in its investigation or in other investigations.[6] His Honour said that ASIC submitted that the Court must weigh the harm that would result from disclosure to AWB against the possibility that the administration of justice would be frustrated or impaired if the documents were withheld.[7]
[6]His Honour referred to Zarro v ASC (1992) 36 FCR 40, 49.
[7]His Honour referred to Sankey v Whitlam (1978) 142 CLR 1, 38-9 and also to Gangami v ASIC (2003) 129 FCR 284 and ASIC v P Dawson Nominees Pty Ltd (2008) 169 FCR 227.
His Honour noted that ASIC accepted that the public interest in the proper administration of justice justified disclosure of the transcripts and statements to Mr Lindberg but that it contended that the opposite conclusion should be reached in relation to AWB.
Turning to AWB’s submissions, His Honour noted that AWB had submitted that ASIC had not provided the Court with sufficient evidence to carry out a balancing exercise between the public interest in non-disclosure of material obtained by ASIC in its investigation and the public interest that AWB should not be denied access to the documents in order to assert its LPP.
His Honour said that he was unable to find that disclosure of the documents to AWB’s lawyers would be injurious to the public interest, having stated the following:
Despite the powerful submissions of ASIC on public interest immunity, which in other circumstances I may accept, on the evidence before me I accept the submission of AWB. As far as I know the transcripts and statements may go no further than what was said at the Royal Commission in public. There may be no interest served in the transcripts and statements not being released. Unless further evidence was led, I am unable to find that disclosure would be against the public interest.
His Honour rejected ASIC’s contention that AWB’s application had been made too late.
His Honour therefore relevantly ordered as follows:
2.At or before 4:15pm on 21 August 2009, and subject to paragraph 5 below, the Plaintiff provide to the external lawyers for AWB copies of witness statements (including draft statements) or transcripts of examinations conducted pursuant to section 19 of the Australian Securities and Investments Commission Act 2001 (Cth):
a)that have been or are to be produced by the Plaintiff to the Defendant pursuant to order 3 of the orders made by Justice Robson on 22 July 2009, as amended by these orders, or by earlier order of the Court; and
b)where those witness statements or transcripts have been obtained by the Plaintiff from:
i) former officers or employees of AWB;
ii) former legal advisers of AWB; or
iii)other persons who have provided services to AWB which may have involved access to communications protected by legal professional privilege (LPP) of AWB.
3.At or before 4.15 pm on 21 August 2009, the Plaintiff give written notice to the Defendant identifying the relevant transcripts and statements given to AWB pursuant to order 2.
4.Subject to paragraph 7 below, the lawyers for the Defendant shall not disclose the relevant transcripts and statements, or any part thereof, to any person who is not a lawyer for the Defendant until after receiving notice from AWB pursuant to paragraph 6 below;
5.Until further order of the Court, the external lawyers for AWB shall not disclose the relevant transcripts and statements, or any part thereof, to any person who is not an external lawyer for AWB.
6.Within 7 days of receiving the relevant transcripts and statements from the Plaintiff, AWB by its external lawyers:
a)serve on the parties a notice describing those parts of the transcripts and statements in respect of which AWB makes an LPP claim and the grounds of any such claim;
b)serve on the parties copies of the transcripts and statements in respect of which AWB makes an LPP claim redacted to obscure the communications the subject of AWB's LPP claims; and
c)return to ASIC all copies of transcripts and statements in respect of which AWB makes no LPP claim and notify the Defendant that it has done so.
7.Until further order of the Court, the lawyers for the Defendant disclose to no other person any information that has been redacted from the copies of the transcripts and statements pursuant to order 6(b) above.
Grounds of appeal
ASIC seeks leave to appeal (if necessary) and seeks to appeal on the following grounds:
1.The Trial Judge erred in finding that the court has inherent jurisdiction to order that a party to a proceeding produce documents to a non-party.
2.The Trial Judge erred in finding that the doctrine of legal professional privilege includes not only an immunity from revealing privileged communications but also a right to be given a practical and realistic opportunity to assert the privilege in order to resist revealing information or documents potentially subject to legal professional privilege.
3.The Trial Judge erred in finding that, in reliance upon a possible claim to legal professional privilege over documents or information in the possession of ASIC as a result of the exercise of its statutory powers, AWB Limited was entitled to restrict the use which ASIC could make of that information and documentation in performing its statutory functions.
4.The Trial Judge erred in finding that AWB Limited was entitled to have access to certain witness statements and transcripts of examinations made and received by ASIC when exercising its statutory powers to investigate aspects of the conduct of AWB Limited for the purpose of possibly asserting legal professional privilege over some information or documents provided to ASIC.
5.The Trial Judge erred in failing to consider whether his refusal to uphold ASIC’s claim to public interest immunity, based upon the insufficiency of supporting evidence, might result in the disclosure of information to AWB Limited which should have been withheld in the public interest.
6.The Trial Judge erred in failing to properly assess the public interest immunity claim made by ASIC by:
(a)failing to give ASIC the opportunity to submit affidavit material before making his order;
(b)failing to inspect the documents in question to consider the merits of the claim.
Is leave to appeal required?
An appeal does not lie to the Court of Appeal, without leave, from a judgment or order given by the Trial Division ‘in an interlocutory application’[8] except (relevantly) in cases of granting or refusing an injunction.[9]
[8]S17A(4)(b) of the Supreme Court Act 1986 (Vic).
[9]S17A(4)(b)(ii) of the Supreme Court Act 1986 (Vic).
ASIC contended that leave to appeal was not required because the orders were final and not interlocutory. ASIC submitted that the orders finally decided the legal rights of the parties. AWB contended to the contrary. Neither party adverted to the exception of cases of granting or refusing an injunction.
In my opinion, it is clear that the orders are interlocutory and not final in nature. They do not decide the legal rights of the parties in the sense laid down in the well-known authorities relating to the distinction between ‘final’ and ‘interlocutory’. If the matter ended there, leave to appeal would be required.
However the question arises whether the exception relating to injunctions, in this case the granting of an injunction, is applicable. Indeed, AWB itself submitted that the Court below had jurisdiction to make the orders that it made pursuant to s37 (1) of the Supreme Court Act 1986 which provides that the ‘Court may by order, whether interlocutory or final, grant an injunction…if it is just and convenient to do so’. AWB submitted that the orders made were ‘injunctions’ within the meaning of that section and, although ASIC did not concede the point, counsel for ASIC was inclined to take the position that the vice in the orders made went rather to discretion than to jurisdiction, thus implicitly accepting that the orders might well properly be characterised as injunctions. Another aspect of ASIC’s submissions supports the view that the orders made were ‘injunctions’, namely, the submission that the only basis available for AWB to seek orders of the kind that it sought was by way of equitable remedies to restrain a breach of confidence.
Further, the word ‘injunction’ has come to be used to mean any order by which a Court commands a person to do or refrain from doing some particular act and these orders seem to fall within that definition.[10] It will be convenient to refer again to this question after considering the grounds of appeal for reasons that will become apparent.
[10]See Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199, 231 (Gaudron J).
Grounds 2 and 4
These grounds are concerned with whether the judge erred in finding that the doctrine of legal professional privilege included not only an immunity from revealing privileged communications but also a right to be given a practical and realistic opportunity to assert the privilege and whether that entailed an entitlement to access to the witness statements and transcripts of examinations made and received by ASIC during its investigation.
The following matters need to be noted as a prelude to considering these grounds.
First, during the course of oral submissions, both parties acknowledged that the evidence in chief at the trial of the proceeding was to be adduced viva voce and not by the use of witness statements. Thus, even if the witness statements and transcripts that are the subject of the orders contain evidence of or reference to communications that are the subject of legal professional privilege, ASIC does not intend to tender any of those witness statements or transcripts in chief.
Second, AWB was unable, for obvious reasons, to produce evidence to the Court below that any communications the subject of legal professional privilege were in fact contained or likely to be contained in the said witness statements and transcripts. All AWB could say was that ASIC had examined and received statements from a significant number of former officers, employees and legal advisers of AWB who were or might be in possession of communications that were the subject of claims of legal professional privilege and that AWB ‘believed’ that there was a ‘serious risk’ that the material contained such communications. Additionally ASIC was of the view that this was unlikely although (as the judge noted) senior counsel for ASIC had conceded that it ‘could not be absolutely certain that some privileged information may not have slipped through the protocol net’ and would be disclosed to Mr Lindberg.
Third, the legal position derived from the decision in Calcraft v Guest[11] is that, even if the witness statements and transcripts contain or refer to communications that were the subject of legal professional privilege, that privilege was lost once the statements or the evidence recorded in them and in the transcripts were supplied to ASIC. That this is the legal position is made clear in a number of authorities.
[11][1898] 1 QB 759.
In Baker v Campbell,[12] a number of members of the High Court said that this was the position. Gibbs CJ[13] referred to the ‘rather remarkable’ rule that if the privileged document, or copy of it, has been obtained by the opposing party, by accident, trickery, or even by theft, it may be given in evidence although the party entitled to the privilege or his solicitor could not have been compelled to produce it. Mason J[14] said that, according to authority, it seemed that the availability of the claim for privilege was lost once the document passed into the possession of another who might then tender it in evidence. Dawson J[15] said that there was authority for the proposition that the privilege might be lost if a document to which it attached came into the hands of someone other than the legal adviser or his client, even dishonestly, so that secondary evidence of it might be given. Brennan J[16] and Deane J[17] also referred to the rule, although not uncritically.
[12](1983) 153 CLR 52.
[13](1983) 153 CLR 52, 67.
[14](1983) 153 CLR 52, 80.
[15](1983) 153 CLR 52, 129.
[16](1983) 153 CLR 52, 109.
[17](1983) 153 CLR 52, 112.
In Commissioner of Australian Federal Police v Propend Finance Pty Ltd,[18] Gummow J said[19] that legal professional privilege was not to be characterised as a rule of law conferring individual rights, breach of which gives rise to an action on the case for damages, or an apprehended or continued breach of which may be restrained by injunction, adding that if the use of privileged documents by the defendant was a breach of confidence then there might be an equity to protect that confidence, referring to Lord Ashburton v Pape[20] but contrasting that case with Calcraft v Guest. Gummow J went on to say[21] (quoting from on article in the Modern Law Review) that the effect of the authorities was that when a privileged document was no longer in the hands of those entitled to claim immunity from production, there was nothing to prevent its use in evidence but that a person who had a right to confidence in a document could enforce his right by injunction.
[18](1997) 188 CLR 501.
[19](1997) 188 CLR 501, 565.
[20][1913] 2 Ch 469.
[21](1997) 188 CLR 501, 566.
In Trevorrow v State of South Australia (No 4),[22] Doyle CJ said,[23] in a case in which the State had obtained possession of privileged documents, that a claim of legal professional privilege in respect of the document was a claim of an entitlement to refuse to produce them to a litigant for inspection, or to refuse to produce them to a court but that as the State had copies of them, it could prove the documents by tendering the copies as secondary evidence, referring to Calcraft v Guest. The Chief Justice said that the claim of legal professional privilege was not, of itself, an obstacle to the tender of the documents, referring to Baker v Campbell. White J[24] said that where confidential communications had already been disclosed to a third party, it was the law relating to the protection of confidences which provided a remedy. Debelle J,[25] who dissented but not on this point, said:
Legal professional privilege provides a ground upon which a party may refuse to produce a document for inspection by his opponent and refuse to produce it to the court. Once a party has in his possession a privileged document or a copy of the document, he is at liberty to tender it. A copy may be tendered as secondary evidence of the contents of the original subject to the party tendering the copy being able to satisfy the court that there is no other bar to the admission of the document: Calcraft v Guest [1898] 1 QB 759. Although there may be other grounds on which to restrain the use of the document, the claim of legal professional privilege is not, of itself, an obstacle to the tender of the documents: Baker v Campbell (1983) 153 CLR 52 at 67-68 per Gibbs CJ, at 80 per Mason J, at 101, 109 and 110 per Brennan J, at 129 per Dawson J. See also the discussion in Cross on Evidence (7th Australian ed, 2004) at [25025] and ALE Newbold, "Inadvertent Disclosure in Civil Proceedings" (1991) 107 LQR 99.
Where a document is privileged but that document or a copy has come into the possession of a party to litigation, the court will in an appropriate case prevent the use of the document, not because it is privileged, but because it is a confidential document: Istil Group Inc v Zahoor [2003] 2 All ER 252 at 274. A document the subject of legal professional privilege is a form of confidential document. A privileged communication which has come into the possession of a third party can no longer be subject to privilege. The privilege by then has been lost: Guinness Peat Properties Ltd v Fitzroy Robinson Partnership [1987] 1 WLR 1027 at 1044 per Slade LJ.
[22](2006) 94 SASR 64.
[23](2006) 94 SASR 64, 70.
[24](2006) 94 SASR 64, 101.
[25](2006) 94 SASR 64, 80.
In Cowell v British American Tobacco Australia Services Ltd,[26] the Court of Appeal said[27] that once information in a privileged document has come into the hands of a party to litigation, even as a result of compulsive process which is later reversed, the fact that the document was and remains privileged does not of itself prevent that party from making use of the information but that equity would intervene in the appropriate case to restrain use of the document and knowledge of its contents on the basis that the communication recorded in the document retained its confidentiality despite improper disclosure – and that the jurisdiction to enjoin publication or use of privileged information is limited to such equity as might inhere in the confidentiality of the communication.
[26][2007] VSCA 301.
[27][2007] VSCA 301 at [32]–[34] (Warren CJ, Chernov and Nettle JJA).
The Court of Appeal in the last mentioned case referred to what Gummow J had said, in relation to cases of confidence protected in equity, in Corrs Pavey Whiting & Byrne v Collector of Customs (Vic),[28] namely, that the plaintiff must be able to identify with specificity, not merely in global terms, that which is said to be the information in question, must be able to show that the information has the necessary quality of confidentiality and was received in such circumstances as to import an obligation of confidence and that there was actual or threatened misuse of that information.
[28](1987) 14 FCR 434, 443.
The submissions of the parties did not make entirely clear where they stood in relation to the above authorities, although most of them were contained in the combined folder of authorities that was provided to the Court. ASIC submitted that AWB was not entitled to the orders obtained in the Court below on the basis of legal professional privilege and that it had failed to make out a case for an injunction on the only basis theoretically available, that of the right in equity to protect confidential information. However, ASIC did not explicitly submit that its possession of documents containing privileged information (if any) meant that the privilege had been lost or that it was not prevented from using such information (if it had any) – but I think that this contention was implicit in the submission made. On the other hand, AWB’s submission was also equivocal – it relied on legal professional privilege to establish its entitlement to ‘a practical and realistic opportunity to assert the privilege’ but then said that the right to such a practical and realistic opportunity was supported by decisions in which it was recognised that a party had an entitlement to preserve ‘the confidentiality’ of relevant communications and that ‘equity will intervene in an appropriate case to restrain use or disclosure’ of such communications.
With that background it is necessary to refer to the prime authority relied upon by AWB and accepted by the judge as providing the legal basis for the orders made. In Commissioner of Taxation v Citibank Ltd,[29] the Full Court of the Federal Court had before it a case in which officers of the Australian Taxation Office had conducted a search at the business premises of the bank purportedly pursuant to s 263 of the Income Tax Assessment Act 1936 (Cth). The bank had in its custody the documents of numerous clients of the bank. The Court held that the doctrine of legal professional privilege restricted the powers of the Commissioner under the relevant section and that the bank should have been given the opportunity adequately to protect its clients’ documents and to make claims of legal professional privilege on behalf of those clients. The failure to give that opportunity vitiated the exercise of the power. Subsequent cases have contained criticism of this case, not so much as to the holding that an adequate opportunity to protect privilege had to be afforded in the circumstances but as to the consequences of failing to do so.
[29](1989) 20 FCR 403.
But whatever the correctness or otherwise of that decision, I do not think that the principle that it is said to exemplify is applicable in the present case. As I would perceive it, the principle applies to circumstances in which an authority under some form of compulsive process seeks to take possession of documents from a person who may wish to claim to be entitled to legal professional privilege in relation to information contained in the documents, either on his own behalf or on behalf of other persons whose documents he holds. In those circumstances the case requires that a practical and realistic opportunity be given to the person holding the documents to claim privilege. The principle is not one which applies or is capable of applying to a situation in which the authority has already obtained possession of the documents from third persons and it does not extend to creating a right to such a practical and realistic opportunity to claim privilege by some other person. The principle cannot extend that far, in my view, because the legal position is, as I have said, that once such documents come into the possession of another party,[30] the privilege is lost or cannot be asserted except in the context of a claim in equity to protect confidentiality.
[30]The position is likely to be different if that party has obtained the privileged documents or information from the person entitled to the privilege on a confidential basis as exemplified in the cases of Mann v Carnell (1999) 201 CLR 1 and Spotless Group Ltd v Premier Building & Consulting Pty Ltd [2006] VSCA 201.
Accordingly, AWB was not in my opinion entitled to the orders obtained below on the basis of the doctrine of legal professional privilege.
AWB’s application bears some resemblance to an application pursuant to rule 32.05 of Chapter 1 of the Supreme Court Rules for pre-trial discovery from a prospective defendant, the contemplated proceeding being one brought in equity for breach of confidence. However it was not made or considered on that basis.
For the foregoing reasons, I think that grounds 2 and 4 are made out.
Ground 3
This ground challenges AWB’s entitlement to restrict the use which ASIC can make of privileged documents or information. It is unnecessary to determine that question in order to determine this appeal.
Grounds 5 and 6
These grounds relate to ASIC’s contention that the witness statements and transcripts are protected by public interest immunity. The weight of authority favours the proposition that it is insufficient simply to claim that immunity without identifying the contents of the documents and the respects in which it would be contrary to the public interest to produce them in order to enable the Court to undertake the necessary ‘balancing exercise’. The weight of authority also favours the proposition that the immunity is in general not available to protect a ‘class of documents’ as such and ASIC’s submissions did not go beyond reliance upon the class of documents involved. I do not think that the judge was in error in the respects covered by these grounds.
Ground 1
This ground is concerned with the Court’s jurisdiction to order that a party to a proceeding produce documents to a non-party – leave was sought to amend the notice of appeal to add this ground. In the circumstances it is unnecessary to grant leave to amend the notice of appeal although I have indicated in the course of considering grounds 2 and 4 how in my opinion the Court’s jurisdiction might arise in circumstances such as the present.
Conclusion
It is unnecessary to decide whether leave to appeal is required. I tend to the view for the reasons that I have given that this is a case of granting an injunction and that leave to appeal is not required. Alternatively, again for the reasons stated, the decision of the judge is attended by sufficient doubt to justify the grant of leave to appeal and I think that, in those circumstances, substantial injustice would be done to ASIC if the orders were to be left undisturbed, because ASIC would be required to disclose to AWB substantial documentation created or obtained in the course of its investigation under Part 3 of the ASIC Act for no good reason. In my opinion, leave to appeal, insofar as necessary, should be granted, the appeal allowed and the orders set aside.
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