Bailey v Director-General, Department of Land and Water Conservation - [2009] NSWCA 100

No judgment structure available for this case.

Reported Decision: 74 NSWLR 333

Appeal Outcome: Special leave dismissed with costs by the High Court, 2 October 2010 s118/2009

New South Wales

Court of Appeal

CITATION: Bailey v Department of Land and Water Conservation [2009] NSWCA 100

HEARING DATE(S): 19 February 2009

JUDGMENT DATE:
5 May 2009

JUDGMENT OF: Allsop P at 1; Hodgson JA at 6; Tobias JA at 7

DECISION: (a) Leave to appeal granted;
(b) Direct the appellants to file and serve their Notice of Appeal within 7 days of the date of this order;
(c) Appeal dismissed;
(d) The appellants to pay the respondents’ costs of the summons for leave to appeal and of the appeal.

CATCHWORDS: PROCEDURE – Discovery and interrogatories – Discovery and inspection of documents – Production and inspection – Grounds for resisting production – Legal professional privilege – Client legal privilege – What constitutes – Whether party supplied sufficient evidence in support of claim for privilege – Whether primary judge was entitled to inspect documents to determine whether they attracted privilege under the Evidence Act and common law – Identification of the “client” for the purposes of s 119 of the Evidence Act – Whether in-house lawyers of Department provided professional legal services – Waiver of privilege – Implied waiver and disclosure waiver – Whether an objection to answering a specified interrogatory on the basis that this would disclose privileged information can be made at the time the answer to the interrogatory is called for – Whether production of certain parts of a redacted document amounted to implied waiver of the claim for privilege over the redacted parts – Whether disclosure of redacted document created inconsistency or unfairness – Whether the prosecutorial duty of disclosure of documents material to the defence prevented privilege from attaching - COSTS – General rule – Costs follow the event – Whether departure from the general rule justified in the circumstances - EVIDENCE – Affidavits – Use of affidavits – Whether affidavits should have been admitted where deponents not cross-examined - APPEAL – Admission of fresh evidence

LEGISLATION CITED: Civil Procedure Act 2005
Evidence Act 1995
Native Vegetation Conservation Act 1997
Supreme Court Act 1970

CASES CITED: A v New South Wales [2007] HCA 10; (2007) 81 ALJR 763
Apple v Wily [2002] NSWSC 855
Attorney-General (NT) v Maurice [1986] HCA 80; (1986) 161 CLR 475
Auburn Council v Austin Australia Pty Ltd [2007] NSWSC 85
Barnes v Commissioner of Taxation [2007] FCAFC 88
Candacal Pty Ltd v Industry Research and Development Board [2005] FCA 649; (2005) 223 ALR 284
Carter v Northmore Hale Davey & Leake [1995] HCA 33; (1995) 183 CLR 121
Commissioner of Taxation v Coombes [1999] FCA 842; (1999) 92 FCR 240
DSE (Holdings) Pty Ltd v Intertan Inc [2003] FCA 384; 127 FCR 499
Egglishaw v Australian Crime Commission (No 2) [2009] FCA 12
Esso Australia Resources v Commissioner of Taxation [1999] HCA 67; (1999) 201 CLR 49
Federal Commissioner of Taxation v Rio Tinto Ltd [2006] FCAFC 86; 229 ALR 341
GE Capital Corporate Finance Group Ltd v Bankers Trust Co [1995] 1 WLR 172; [1992] 2 All ER 993
Great Atlantic Insurance Co v Home Insurance Co [1981] 1 WLR 529; [1981] 2 All ER 485
Hooker Corporation Ltd v Darling Harbour Authority (1987) 9 NSWLR 538
Mallard v The Queen [2005] HCA 68; (2005) 224 CLR 125
MAM Mortgages Ltd (in liq) v Cameron Bros (No 2) [2001] 1 Qd R 46
Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1
Nea Karteria Maritime Co Ltd v Atlantic & Great Lakes Steamship Corporation [No 2] [1981] Com.L.R 138
New South Wales Bar Association v Archer [2008] NSWCA 164
Osland v Secretary, Department of Justice [2008] HCA 37; (2008) 234 CLR 275
R v Brown [1998] AC 367
R v Bunting [2002] SASC 412; (2002) 84 SASR 378
R v Keane [1994] 1 WLR 746; [1994] 2 All ER 478
R v Reardon (No 2) [2004] NSWCCA 197; (2004) 60 NSWLR 454
Singapore Airlines v Sydney Airports Corporation [2004] NSWSC 380
State of New South Wales v Jackson [2007] NSWCA 279
Standard Chartered Bank of Australia v Antico (1993) 36 NSWLR 87
Telstra Corporation v Australis Media Holdings (Supreme Court of New South Wales, McLelland CJ in Eq, 10 February 1997, unreported)
Westpac Banking Corporation v 789Ten Pty Ltd [2005] NSWCA 321; (2005) 55 ACSR 519
Unsworth v Tristar Steering & Suspension Australia Ltd [2007] FCA 1082
Woollahra Municipal Council v Westpac Banking Corporation (1994) 33 NSWLR 529

PARTIES: Bruce Clyde Bailey
Janet Beatrice Shafik-Bailey
Director-General of the Department of Land and Water Conservation now known as Director-General Department of Natural Resources New South Wales
Water Administration Ministerial Corporation
State of New South Wales

FILE NUMBER(S): CA 40184/08

COUNSEL: A: P E King / C P Carter
R: G C Lindsay SC / J Harvey

SOLICITORS: A: Hicksons Lawyers, Sydney
R: Crown Solicitor's Office, Sydney

LOWER COURT JURISDICTION: Supreme Court

LOWER COURT FILE NUMBER(S): SC 20448/06

LOWER COURT JUDICIAL OFFICER: James J

LOWER COURT DATE OF DECISION: 22 May 2008

CA 40184/08

ALLSOP P
HODGSON JA
TOBIASJ A
Tuesday 5 May 2009

BRUCE BAILEY & ANOR v DIRECTOR-GENERAL DEPARTMENT LANDS & WATER CONSERVATION & ORS

Judgment

1 ALLSOP P: I have read the reasons in draft of Tobias JA. I agree with the orders proposed by his Honour. Subject to the following comments, I agree with his Honour’s reasons.

2 The first comment concerns the respondents’ attitude to proof of the privilege before the primary judge and is by way of qualification and elaboration. For myself, I would not accept as satisfactory the reasons advanced by Mr Harvey for the inadequacy of the evidence. The respondents appeared to have approached the protection of the privilege in a way which can be described as cavalier. Parties should not assume that a judge will put himself or herself to the time and trouble of examining a multitude of documents if the relevant party cannot muster sufficient interest in the protection of its rights to provide an affidavit in support of its claim. That said, the primary judge was plainly entitled to examine the documents to make a decision about privilege. The transcript makes clear that the course he took in inspecting the documents was not opposed by the appellants. In those circumstances, it is not open to the appellants to assert that this decision of his Honour to examine the documents was a miscarriage of any power.

3 The second comment concerns Great Atlantic Insurance Co v Home Insurance Co [1981] 1 WLR 529 and is by way of qualification. I would distinguish Great Atlantic from the facts here. In Great Atlantic, part of a privileged document was disclosed. It was not possible to sever or segregate the balance of the document from the waived part. Here, the privileged portion redacted was a section of a document otherwise not privileged (as recognised before the primary judge, though an inappropriate claim for privilege had been made over the whole document). I would leave for an occasion on which it was necessary to decide the true limits of any principle in Great Atlantic, if such extends beyond waiver through dealing or acts inconsistent with the maintenance of the confidentiality of the communication and thus the privilege: Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1 at 13 [29]. It is also necessary to recognise in any discussion of Great Atlantic that unintentional acts, which are not irrevocable, do not necessarily lead to waiver: for example, see Hooker Corporation Ltd vDarling HarbourAuthority (1987) 9 NSWLR 538.

4 The third comment also concerns the notion of inconsistency in the waiver of privilege and is by way of elaboration. Though fairness may have a part to play in assessing inconsistency, it is not a freestanding or overriding principle of fairness “operating at large”: Mann v Carnell at 13 [29]. I agree with Hodgson JA in Archer [2008] NSWCA 164 at [48] cited by Tobias JA. I would also refer to what I said in DSE (Holdings) Pty Ltd v Intertan Inc [2003] FCA 384; 127 FCR 499 at 504-529 [11]-[113] (though in context of the common law). At 519-520 [57]-[58] I agreed with Hodgson J (as he then was) in Standard Chartered Bank of Australia Ltd v Antico (1993) 36 NSWLR 87 as to the need to make an express or implied assertion of the content of the confidential communication. His Honour repeated these comments in Archer at [47]-[48]. The importance of this repetition, after Mann v Carnell, is to reinforce the fact that the relevant issue is inconsistency, not general fairness. As the discussion in DSE reveals (especially at 521-529 [70]-[113]) there is, after Mann v Carnell, a latent difficulty in some of the jurisprudence arising from the application of general notions of fairness verging on a discretion. Mann v Carnell brought an important clarification and sharpness to the analysis which cannot be easily reconciled with Attorney-General (NT) v Maurice (1986) 161 CLR 475 in its application to specific circumstances, or generally. With the greatest respect to those who consider that Mann v Carnell worked no real change (cf the Full Court of the Federal Court in Commissioner of Taxation v Rio Tinto Ltd [2006] FCAFC 86; 229 ALR 304 at 316 [44]) a review of many of the decisions based on a general overriding principle of fairness and a reconsideration of them based on assessing the inconsistency with the confidentiality underlying the privilege (even informed in part by fairness) leads one to appreciate the practical reality of the change. The approaches in many of the cases discussed in DSE at 521-529 [70]-[113] would be difficult to sustain under Mann v Carnell.

5 The fourth comment concerns prosecutorial disclosure and is by way of qualification. I would reserve to an occasion on which it was necessary to decide the question whether privilege can be lost by operation of law if a document by some identified time should have been disclosed to an accused, but, in breach of the posited duty, was not. For the reasons otherwise given by Tobias JA, there was no basis to conclude that any such breach occurred here.

6 HODGSON JA: I agree with Tobias JA, subject to the comments of Allsop P, with which I also agree.

7 TOBIAS JA: By an Amended Statement of Claim filed on 27 April 2007 the claimants (whom I shall refer to as the appellants) claimed damages against the Director-General, Department of Natural Resources New South Wales (formerly the Director-General, Department of Land and Water Conservation) (the Director-General), the Water Administration and Ministerial Corporation and the State of New South Wales (the Crown), together the respondents.

8 The appellants relevantly alleged that the Director-General, in commencing and maintaining a prosecution against the first appellant (Mr Bailey) in the Land and Environment Court for breach of ss 17(1) and 21(2)(a) of the Native Vegetation Conservation Act 1997 (the NVC Act), and in commencing and maintaining an appeal to the Court of Criminal Appeal against the dismissal of those proceedings, had maliciously prosecuted Mr Bailey without reasonable or probable cause.

9 On 27 November 2007 the appellants filed a Notice of Motion seeking an order that the respondents produce for inspection certain documents referred to in Part 1(b) of the list of documents dated 20 September 2007 (the List), filed by them and in respect of which legal professional privilege or, more accurately, client legal privilege under ss 118 and 119 of the Evidence Act 1995 (the Evidence Act), was claimed. James J heard that application on 18 and 19 March 2008 and 8 April 2008. On 22 May 2008 his Honour delivered judgment ordering the respondents and, relevantly, the Director-General, to produce for inspection all documents relating to the assessment of the alleged offences according to the Director of Public Prosecution’s Policy and Guidelines as referred to in paragraph 3.8 of Document 76 on the List. Subject to that order, his Honour dismissed the appellants’ application, upholding the respondents’ claim for privilege with respect to all of the other documents identified in Part 1(b) of the List.

10 The decision of the primary judge being interlocutory, the appellants seek this Court’s leave to appeal against that decision pursuant to s 101(2)(e) of the Supreme Court Act 1970. The application for leave and the appeal have been heard concurrently.

The relevant background

11 The appellants were the owner of a farming and grazing property known as “Hazeldene” located near Moree. They acquired an area of land known as the Strip adjacent to Hazeldene for the purpose of constructing a large dam thereon. In July 2000 officers of the Department of Land and Water Conservation (the Department) attended the Strip and found that approximately 107 hectares of native vegetation had been cleared therefrom. A subsequent inspection in January 2002 revealed that a further 13 hectares of native vegetation adjacent to the original cleared area had been cleared, thus bringing the total area cleared to 120 hectares.

12 Mr Bailey was interviewed and admitted to authorising the clearing, indicating that it was for the purpose of constructing a large dam or reservoir, which was to be used as a water supply source for, proposed crop cultivation on his property.

13 Mr Bailey had carried out the clearing of vegetation upon the Strip as a consequence of advice received from his solicitors that he was entitled to do so without being in breach of the NVC Act due to an exemption which permitted native vegetation to be cleared without consent for the purpose of constructing a “rural structure” such as a “farm dam”.

14 It would appear that the Department’s position was that this exemption was only intended to permit the construction and maintenance of what is referred to in Document 76 as “everyday farm structures” such as small scale farm dams, but that it did not permit the construction of what was referred to in that document as “a large reservoir intended to facilitate the establishment of a new agricultural enterprise”.

15 On 28 June 2002 the Director-General accepted a recommendation of the Deputy Director-General to approve the commencement of a prosecution against Mr Bailey in the Land and Environment Court for clearing native vegetation contrary to Part 2 of the NVC Act. On 18 July 2002 those proceedings, which comprised two charges, were instituted in the Class 5 jurisdiction of the Land and Environment Court. As such, they were criminal proceedings.

16 On 1 July 2003 Talbot J dismissed the proceedings holding that the extent of the clearing effected by Mr Bailey was no more than was necessary for the construction of a water storage facility and that the proposed facility was a “rural structure”, being a “farm dam”, within the meaning of the relevant exemption to the NVC Act. Accordingly, Mr Bailey was acquitted on both charges.

17 At the request of the Director-General, Talbot J identified two questions of law for determination by the Court of Criminal Appeal. On 5 December 2003, that Court answered both questions favourably to Mr Bailey.

18 Mr Bailey’s allegation of malicious prosecution as pleaded in the Amended Statement of Claim thus arises out of the commencement and maintenance by the Director-General of both the proceedings in the Land and Environment Court and the appeal to the Court of Criminal Appeal.

The making of and compliance with orders for discovery and the claims for client legal privilege before the primary judge

19 On 27 July 2007 Adams J made a number of orders including one that the respondents file and serve a list of documents falling within the categories of documents specified in a letter from the appellants’ solicitors dated 9 July 2007. On 27 August 2007 his Honour made an order varying some of the categories of documents to be discovered. The orders made by Adams J did not require the respondents’ Iist of documents to be verified.

20 On 21 September 2007 the respondents filed a single unverified list of documents being the List. Part 1 listed the documents in the respondents’ possession. Part 1(a) comprised documents in respect of which no claim for legal professional privilege was made. Part 1(b) comprised documents in respect of which that privilege was claimed. They comprised 340 out of a total of 364 documents.

21 Rule 21.3(2)(d) of the Uniform Civil Procedure Rules 2005 (the UCPR) provides as follows:

“(2) The list of documents:

(d) must identify any document that is claimed to be a privileged document, and specify the circumstances under which the privilege is claimed to arise.”

22 The primary judge held (at [36]) that at least in the case of some documents, Part 1(b) of the List did not comply with that sub-rule. Although there was a column headed “Circumstances under which privilege is claimed”, the only entry under that column was “Legal Professional Privilege”.

23 At the hearing before the primary judge the respondents produced a further document headed “Documents subject to claim of legal professional privilege” which became Exhibit D1 in the motion heard by James J. That exhibit relevantly contained three columns. The first provided a description of the document, the second indicated its purpose and the third was headed “How document came into existence”. It would be fair to say that Exhibit D1 went some way towards remedying the non-compliance of the List with r 21.3(2)(d) although, as his Honour noted at [24], the respondents did not so rely upon it. However, it was agreed that Exhibit D1 did not constitute evidence in support of the respondents’ claim for privilege and should be treated only as a submission.

24 Two affidavits were filed on behalf of the respondents in support of the claim for client legal privilege. The first was that of Ms Afsana Jallia-Tahery, a solicitor employed in the Crown Solicitor’s Office. She deposed that she had made various enquiries and obtained information about individuals named in the “nature of document/s” column in Part 1(b) of the List. The information she had obtained was that a number of those individuals had been admitted as legal practitioners, held practising certificates, had been working as solicitors in the Crown Solicitor’s Office and had provided legal services in relation to the prosecution of Mr Bailey. Others of those individuals had been admitted as solicitors and held practising certificates. It would appear that they were officers of the Department.

25 The second affidavit was that of Luke Samuel Phelps, a legal officer of the Department. He deposed that he had obtained information that a number of the individuals named in the “nature of document/s” column in Part 1(b) of the List had been legal officers in the Department during the period of the prosecution of Mr Bailey. He also verified an organisational chart of the Department, which was annexed, to his affidavit.

26 Each of Ms Jallia-Tahery and Mr Phelps were given notice to attend for cross-examination on their affidavits. Neither attended and their failure to do so was the subject of submissions to which I shall refer below.

27 As the primary judge noted at [26], the List used the expression “legal professional privilege”. This expression was more apt to refer to legal professional privilege at common law than to client legal privilege under the Evidence Act. However, it was common ground that as a result of r 1.2 of the UCPR and the definitions of “privileged document” and “privileged information” in the Dictionary to those Rules, that the law as to privilege to be applied was not the common law but the relevant sections of Div 1 of Pt 3.10 of the Evidence Act.

28 At [27] of his judgment his Honour noted that it was not disputed at the hearing that he had power to himself inspect the documents in respect of which privilege was claimed. Apart from any common law authority, s 133 of the Evidence Act contained such a power. It was in the following terms:

“If a question arises under this Part relating to a document, the court may order that the document be produced to it and may inspect the document for the purpose of determining the question.”

29 His Honour exercised that power and inspected all of the documents in respect of which privilege was claimed. As a consequence he held at [43] that the documents in respect of which a claim for client legal privilege was pressed fell within one or other of the following classes:

“1. File notes by legal officers of the Department

2. Communications between a Departmental legal officer and a solicitor in the Crown Solicitor’s Office

3. Communications between a Departmental legal officer and a Departmental regional officer for the purpose of acquiring evidence

4. Communications between the barrister briefed by the Crown Solicitor and either a solicitor in the Crown Solicitor’s Office or a Departmental legal officer

5. Communications between a Departmental legal officer and a witness or potential witness or a person who might provide information for the purpose of the proceedings”

30 The primary judge noted (at [3] and [28]) that the application by the appellants for an order for production of documents for inspection was the subject of oral argument extending over more than two days and which “ranged very widely”. However, he distilled the principal submissions of the appellants in support of the application into four categories, namely,

Uniform Civil Procedure Rules

2. No client legal privilege ever came into existence.

Evidence Act.

Evidence Act

31 The appellants’ submissions in support of each of these categories were rejected by the primary judge (at [107]) except with respect to the fourth his Honour found (at [106]) that, within the meaning of s 122(1) of the Evidence Act, the respondents had consented to the disclosure of all documents relating to the assessment of the alleged offences according to the DPP Prosecutions Policy and Guidelines which had been referred to in paragraph 3.8 of Document 76. I shall return to this document later in these reasons.

The appellants’ grounds of challenge to the decision of the primary judge

32 The appellants’ submissions to this Court seemed to range as widely as they did before the primary judge. In their written submissions, ten grounds of challenge were identified notwithstanding that the relevant grounds of appeal set out in the Draft Notice of Appeal were confined to the following:

Evidence Act

33 The ten grounds of challenge set out in the appellants’ written submissions at pp 4–5 alleged that the primary judge had erred in the following respects (I have amended their form but not their substance):

(i) in failing to reject the respondents’ claim for client legal privilege for failure to comply with r 21.3(2)(d) of the UCPR and/or in the absence of evidence capable of supporting that claim without recourse to inspection of the relevant documents;

(ii) in finding that notwithstanding the failure of the respondents to file evidence capable of supporting the claim for privilege, he could nevertheless determine that claim by inspecting the relevant documents;

(iii) in finding that the Director-General was only a “ nominal prosecutor ”;

(iv) in failing to find that it was necessary to identify the “ client ” for the purpose of s 119 of the Evidence Act in order to sustain a claim by that “ client ” for privilege;

(v) in the absence of any direct or other satisfactory evidence, in inferring that the in-house lawyers of the Department were agents of the Director-General for the purposes of s 117(1)(b) of the Evidence Act ;

(vi) in finding that the respondents were entitled to mask parts of Document 76 in circumstances where the whole of that document had allegedly been relied upon by the Director-General in determining whether to accept the recommendation to commence prosecution proceedings against Mr Bailey;

(vii) in classifying the respondents’ case to the effect that Document 76 gave rise only to questions of “ disclosure waiver ” and not “ issue waiver ”;

(viii) in finding that the disclosure of many paragraphs of Document 76 did not amount to consent to the disclosure of all parts of the document including those parts which had been redacted;

(ix) in failing to find that the respondents had waived privilege pursuant to s 122(1) of the Evidence Act with respect to all documents in respect of which client legal privilege was claimed and, in particular, all parts of Document 76;

(x) in failing to find that the respondents had waived client legal privilege pursuant to s 122(4) of the Evidence Act .

34 It is convenient to deal with the various challenges by the appellants individually, referring first to the primary judge’s decision the subject of challenge, second to the appellants’ submissions with respect to that challenge and, third, to its outcome. In doing so I shall not necessarily follow the order in which the grounds of challenge appear in the preceding paragraph.

The alleged failure of the respondents to comply with the requirement of r 21.3(2)(d) of the UCPR and to provide probative evidence in support of their claim for privilege

35 As I have indicated, the primary judge accepted that the List did not comply with r 21.3(2)(d). Although the appellants had submitted that no subsequent document provided by the respondents had cured that default, I have already expressed the view that Exhibit D1 went some way towards specifying the circumstances under which the claim to privilege was said to arise. However, the respondents conceded before his Honour that the entries in Exhibit D1 could not of themselves constitute compliance with the rule that, of course, must be complied with as at the date the relevant list of documents is filed. The effect of Exhibit D1 was simply to provide further information to the appellants as to the basis upon which the respondents were claiming privilege.

36 His Honour held (at [36]) that failure to comply with the rule was not fatal to the maintenance of the privilege. He accepted the respondents’ submission that, having made his own inspection of the documents, he was able to decide in the case of each document whether circumstances existed which would give rise to the privilege. In so finding his Honour relied upon the decision of the Full Court of the Federal Court of Australia (Tamberlin, Stone and Siopis JJ) in Barnes v Commissioner of Taxation [2007] FCAFC 88.

37 In Barnes the Court found that the affidavit evidence filed in support of the claim for privilege fell far short of providing an adequate basis for any such claim in respect of any individual document. This, their Honours said, was unsatisfactory. Thus the Court observed:

Kennedy v Wallace

National Crime Authority v S

Grant v Downs

Kennedy v Wallace

dominant

one

19 In the light of these principles it is clear that the evidence provided by the appellants is manifestly insufficient and does not establish any basis for their claim of privilege.”

38 Notwithstanding the unsatisfactory state of the evidence before them, their Honours (at [20]) decided to inspect the documents in question themselves. After so doing, they concluded (at [22]) that it could be reasonably inferred from their contents and on the face of at least some of the documents, that they came into existence with the dominant purpose of providing legal advice and thus attracted the privilege.

39 In the present case it was not in dispute that r 21.3(2)(d) had not been complied with. Of itself that could not be a proper basis for declining to entertain the respondents’ claim for privilege. The rules do not so provide and it would be inappropriate for them to do so. No doubt the purpose of the rule in question is to provide sufficient particulars to the party seeking to inspect the documents as to the basis of the claim for privilege so that that claim could be, if thought appropriate, contested. Given the contents of Exhibit D1, it would be difficult for the appellants to assert that as a consequence of the non-compliance with the rule, they were relevantly prejudiced in their opposition to the claim. No case based on a denial of procedural fairness was sought to be made.

40 Of greater significance was his Honour’s implicit finding that the evidence filed in support of the respondents’ application for privilege was manifestly unsatisfactory and inadequate. The importance of a claim for privilege being supported by probative evidence was emphasised in Barnes at [18]. This notwithstanding, Barnes stands as authority for the proposition that a judge may inspect the documents in respect of which privilege is claimed and form his or her own view as to whether the legal requirements for privilege are satisfied. His Honour did so in the present case and, as will appear, in my opinion no error was disclosed in his taking that course.

41 However, it is necessary to sound a warning with respect to the failure of a party to comply with the rule when claiming privilege. Such a failure is in no way to be encouraged. In particular, it would have been open to the primary judge in this case to have adjourned the hearing, directed the respondents to file a new list of documents that complied with the rules and order that they pay the costs, and possibly indemnity costs, thrown away by the need for that adjournment. The rule is there for a purpose and compliance with it is mandatory unless expressly dispensed with by order of the Court pursuant to s 14 of the Civil Procedure Act 2005. Although non-compliance is not fatal to a claim for privilege, the consequences of non-compliance with the rule, some of which I have referred to above, may be significant. This is particularly so where instrumentalities or agencies of the State are involved.

42 The same observation can be made with respect to the failure to file and serve satisfactory evidence in support of a claim for privilege. In the present case the respondents’ failure to do so was the subject of the following exchange between his Honour and counsel for the respondents:

Barnes

HIS HONOUR: Are you suggesting that the [respondents] could not adduce clear and probative evidence?

HARVEY: Yes, given the number of people involved. When one looks at the documents, there are a great number of people who have been involved in the preparation of the case against Bailey and rightly or wrongly, the judgment was exercised that the resources of the [respondents] were better placed not by seeking to adduce evidence from specific or identify specific authors of documents and authors of communications and seek out each and every one of them because that is what would be required. If one took one document and obtained affidavits, an affidavit from Mr Graham, you would be commencing a process by having to take affidavit evidence from virtually all of the authors of the documents and/or all of the persons who were involved in the relevant communications to which those documents relate.

But again, rightly or wrongly, the view was taken that the secondary approach be adopted of placing before the Court the privileged documents, allowing the Court to inspect those documents and review those documents and to form some views on the basis of them.

Barnes

43 The respondents thus submitted that there were practical difficulties in complying with the rule where so many individuals were involved. The same explanation was given with respect to the inadequacy of the affidavit evidence filed by the respondents in support of their claim for privilege. There is some truth in that submission as there were approximately six legal officers of the Department and some 19 other Departmental officers who appear to have been involved to a greater or lesser degree in the communications in respect of which privilege was claimed. One can understand that even if an affidavit had been made on information and belief, instructions would need to have been obtained from each and every one of those persons which would have involved a considerable amount of time as well as a significant expenditure of resources.

44 Although in the present case I would accept the reasons advanced to excuse the inadequacy of the evidence filed in support of the respondents’ claim for privilege, that excuse should not become the norm and should be used sparingly and then only in an appropriate case such as the present. In other cases, a failure to file and serve adequate evidence to support a claim for privilege may well have similar consequences to those to which I have referred where there has been a non-compliance with r 21.3(2)(d).

45 Furthermore, and particularly where agencies of the State are litigants, every effort should be made not only to ensure that the rules are complied with, but also to ensure that evidence in support of a claim for privilege is in all respects adequate and compelling. It would be both inappropriate and risky for the inadequacies to which I have referred to be ignored simply upon the basis that the judge can inspect the documents and decide the issues for him or herself. Such a course involves expenditure of considerable time on the part of the judge which, although it cannot be totally avoided, may well be able to be reduced where, as was said in Barnes, “focussed and specific evidence” has been filed in support of a claim for client legal privilege.

The alleged failure of the respondents to identify the “

client

” for the purpose of the application of ss 118 and 119 of the

Evidence Act

46 Section 118 of the Evidence Act is referred to as “legal advice privilege”. Section 119 is referred to as “litigation privilege”. Each are in the following terms:

“118. Evidence is not to be adduced if, on objection by a client, the court finds that adducing the evidence would result in disclosure of:

(a) a confidential communication made between the client and a lawyer, or

(b) a confidential communication made between 2 or more lawyers acting for the client, or

(c) the contents of a confidential document (whether delivered or not) prepared by the client, lawyer, or another person,

for the dominant purpose of the lawyer, or one or more of the lawyers, providing legal advice to the client.

119. Evidence is not to be adduced if, on objection by a client, the court finds that adducing the evidence would result in disclosure of:

(a) a confidential communication between the client and another person, or between a lawyer acting for the client and another person, that was made, or

(b) the contents of a confidential document (whether delivered or not) that was prepared,

47 It is to be noted that under s 118 the relevant communication must have been made or prepared for the dominant purpose of the lawyer providing legal advice to “the client”. Under s 119 the relevant communication or document must have been made or prepared for the dominant purpose of “the client” being provided with professional legal services relating to proceedings existing, anticipated or pending, in which “the client” is or may be a party. The word “client” is defined in s 117(1)(b) of the Evidence Act to include, relevantly, “an employee or agent of a client”.

48 It was submitted before the primary judge that in the present case the only relevant “client” was the Director-General, who had been the prosecutor in the proceedings in the Land and Environment Court and the appellant in the proceedings in the Court of Criminal Appeal. However, it was common ground that none of the Departmental legal officers who had made or prepared the documents in respect of which privilege was claimed was “an employee” of the Director-General. Rather, the employer of the Department’s legal officers and other officers who were party to the relevant communications or documents was the Crown who, it was accepted, was not the “client” for relevant purposes.

49 It was therefore submitted that the relevant legal and other officers of the Department were “agents” of the Director-General. However the appellants submitted that the onus was on the respondents to prove any such agency and that no evidence had been adduced to discharge that onus.

50 The primary judge dealt with that submission in the following terms:

“51 It is unnecessary for me to determine whether the Crown or the Director-General should be regarded as having been the party to the proceedings in the Land and Environment Court or in the Court of Criminal Appeal. If the Crown was the party, then it would also have been the ‘client’ and each Departmental legal officer would also have come within the extended definition of ‘client’ in s 117(1)(b) as being an employee of the client. If the Director-General was the party, then he would also have been the client and the Departmental legal officers would also have come within the extended definition of ‘client’ in s 117(1)(b) as being an ‘agent’ of the client.

52 I accept that the onus would be on the [respondents] to establish that the Departmental legal officers were agents of the Director-General. However, such an agency could readily be inferred from the circumstances that the Departmental legal officers were qualified lawyers working as lawyers in a government department administered by the Director-General, making communications on behalf of the Director-General with potential witnesses or sources of information, solicitors in the Crown Solicitor’s Office or counsel, for the purpose of court proceedings being brought by the Director-General as a party.

53 I consider that the communications by or to a Departmental legal officer came within s 119 as being communications between a ‘client’ (the term including the Departmental legal officer) and another person or between a lawyer acting for a client (the Crown or the Director-General) and another person.”

51 The appellants submitted that his Honour had erred in inferring from the circumstances that the Department’s legal officers were agents of the Director-General. Although the appellants placed reliance upon passages from my judgment in Westpac Banking Corporation v 789Ten Pty Ltd [2005] NSWCA 321; (2005) 55 ACSR 519, that case, so far as it was concerned with the question of agency, turned on its own particular facts. It contained no relevant statement of principle applicable to the present case.

52 From the organisational structure of the Department annexed to the affidavit of Mr Phelps, it is apparent that all divisions within the Department such as, for instance, Legal and Compliance, are responsible through the Deputy Director-General to the Director-General as head of the Department. In the present case, the Director-General was the prosecutor and it was ultimately his decision whether or not to prosecute. In so doing he no doubt relied upon recommendations made to him by the appropriate officers within his Department. As Director-General, he was ultimately responsible for the functions and operations of the Department including the taking of such steps as were necessary in order to bring to fruition the recommendation as to whether Mr Bailey should be prosecuted for breach of the NVC Act, being legislation the administration of which he, as head of the Department, was responsible: see, eg, ss 15(3), 29, 31, 37, 40, 42(2)(d), 46, 47, 50, 56, 60 and 66. With due respect to the appellants’ submissions, it defies common sense to suggest that the legal or other officers within the Department were providing or receiving legal advice otherwise than as the agents of the Director-General for the purpose of providing him with such information as was appropriate to enable him to ultimately determine whether or not to proceed to prosecute.

53 Accordingly, in my view no error has been demonstrated with respect to the finding of agency of the primary judge at [52] of his judgment.

The allegation that the primary judge erred in inspecting the documents for the purposes of an application for client legal privilege under the

Evidence Act

54 The appellants submitted that in the circumstances of the case the undoubted power of the primary judge to inspect the documents was exercised for an inappropriate purpose. This submission was allied with the contention that there was no evidence in support of the respondents’ claim that the relevant communications and documents were made or prepared for a dominant purpose within the meaning of ss 118 and 119.

55 To the extent to which the primary judge had purported to exercise his power under s 133 of the Evidence Act, it was submitted that his exercise of that power had miscarried as no question had relevantly arisen under Pt 3.2 relating to a document: rather the question arose under r 21.3(2)(b).

56 It was further submitted that s 133 only permitted an inspection that confirmed the effect of evidence otherwise filed to support a claim for privilege. Reliance was placed upon a passage from the judgment of Gyles J in Unsworth v Tristar Steering & Suspension Australia Ltd [2007] FCA 1082 where his Honour (at [8]) said, without objection, that he had inspected documents pursuant to s 133 of the Evidence Act for the purpose of assessing the nature of the documents and that that inspection had confirmed the effect of the evidence which, in that case, related to issues of confidentiality.

57 However, the decision in Unsworth is not authority for the proposition advanced by the appellants, namely, that the power under s 133 to inspect documents cannot be used as a substitute for admissible evidence to support the various elements necessary to establish privilege so that if evidence in respect of any one of those elements is missing, the gap cannot be filled by an inspection of the documents. In my view s 133 cannot be so construed. The Court’s power to inspect is engaged under the section in any case where “a question arises under this Part relating to a document”. A question arose in the present case under Pt 3.2 as to whether the documents identified in Part 1(b) of the List attracted privilege under s 118 or s 119 of the Evidence Act. The primary judge was therefore empowered to inspect the documents for the purpose of determining that very question. This he did in the exercise of his discretion. As I conclude under the next heading, no error has been demonstrated in his taking that course.

58 In any event, the present was not a case where there was no evidence in support of the claim for privilege. Certainly it was inadequate and insufficient but it did establish the legal qualifications of the legal officers who were party to many of the documents and, further, provided some evidence from which his Honour could draw the inference that those officers were relevantly acting as agents of the Director-General in preparing documents relating to the possible prosecution of Mr Bailey.

The allegation that the primary judge had no power to inspect for the purposes of an application for common law legal professional privilege

59 Strictly speaking, this issue does not arise as the privilege claimed was under the Evidence Act, not the common law. However, some comment on the issue is appropriate as the power to inspect arises under both.

60 A common law claim for legal professional privilege was recently discussed by Giles JA, with whom Mason P and Beazley JA agreed, in State of NSW v Jackson [2007] NSWCA 279. At [24] his Honour said:

Grant v Downs

Trade Practices Commission v Sterling

Woollahra Municipal Council v Westpac Banking Corporation

Esso Australia Resources Ltd v Commissioner of Taxation

AWB Ltd v Cole

Grant v Downs

Mallalla District Council v Livestock Markets Ltd

Esso Australia Resources Ltd v Commissioner of Taxation

Woollahra Municipal Council v Westpac Banking Corporation

61 In Woollahra Municipal Council v Westpac Banking Corporation (1994) 33 NSWLR 529 Giles J (as he then was) at 542 (being the page reference referred to by him in Jackson), when considering whether he should inspect the documents in dispute for the purpose of reaching a conclusion as to whether they were privileged, observed:

Grant v Downs

62 His Honour was there dealing with the power to inspect at common law. The critical word in the passage referred to is “unnecessarily”. If the court is unable to proceed upon the evidence, as in the present case, then in my view there is no impediment to the court exercising its undoubted discretion under s 133 to order that the document or documents be produced and inspected for the purpose of determining the question of whether privilege attaches. How the court utilises the power to inspect under s 133 will obviously depend on the circumstances of each case. I do not consider that merely because the party resisting the claim for privilege objects to the judge exercising the power under s 133 is of itself a legitimate reason to refuse to exercise the discretion: cf Singapore Airlines v Sydney Airports Corporation [2004] NSWSC 380 at [66] per McDougall J. As was noted by Giles JA in Jackson in the passage which I have recorded at [60] above, in Esso Australia Resources v Commissioner of Taxation [1999] HCA 67; (1999) 201 CLR 49 at 70 [52], Gleeson CJ, Gaudron and Gummow JJ observed that a court “should not be hesitant to exercise” its power to examine documents.

63 In the present case, it is clear from a number of references in the transcript before the primary judge that counsel for the appellants did not actively object to his Honour exercising his power under s 133 to inspect the documents. His Honour indicated that he proposed to look at the documents to which counsel responded in the following terms:

Telstra

Barnes

National Crime Authority v S

64 In the appellants’ Outline of Submissions to the primary judge dated 14 March 2008, paragraphs 7 and 10 were in the following terms:

Telstra v Minister for Communications

Barnes v Commissioner of Taxation

National Crime Authority v S

…

The Court could look at the documents. That is an alternative approach

Campbell v Baker

65 In the foregoing circumstances, in my opinion it has not been established that the exercise by his Honour of his discretion under s 133 to inspect the documents miscarried.

The allegation that the primary judge erred in admitting the contents of the affidavits of Ms Jallia-Tahery and Mr Phelps when they did not make themselves available for cross-examination

66 As I have indicated, notice was given for each of those deponents to attend for cross-examination. Although his Honour (at [20]) observed that Ms Jallia-Tahery was overseas and was not available, he was in fact informed that she was “leaving the country” which, so it was submitted, carried with it the inference that she had not yet done so. However, Mr Phelps was available but ultimately did not attend for cross-examination and his Honour informed the parties that he would take into account that neither deponent had been cross-examined. He also observed, with some justification in my opinion, that it was unclear what useful evidence the deponents could have given if either had been cross-examined.

67 The precise nature of the appellants’ challenge to the admission of the evidence of the two deponents is difficult to fathom. One was apparently not available and the other was, but we were not referred to any part of the transcript where it was submitted on behalf of the appellants that Mr Phelps’ evidence or, for that matter, Ms Jallia-Tahery’s, should be totally disregarded due to the fact that they were not cross-examined.

68 In any event, it is apparent that in all probability his Honour only utilised the affidavits for the purpose of establishing the legal qualifications of the Department’s legal officers and for inferring that they and other non-legal officers were agents of the Director-General. I see no error in his Honour having used the affidavit material for that purpose, notwithstanding that neither deponent was cross-examined.

The allegation that the primary judge erred in failing to provide the appellants with the opportunity to make submissions before or after he inspected the documents

69 After he had inspected the documents, counsel for the appellants indicated that he wished to make submissions, to which his Honour responded that he was not about to announce the result. However, he said:

Evidence Act

70 Counsel then requested his Honour to indicate to which documents he was referring, to which he responded

“All of them. They are documents prepared with the dominant purpose of a client being provided with legal services relating to anticipated or pending proceedings in the Land and Environment Court or anticipated or pending proceedings in the Court of Criminal Appeal. There are documents relating to a possible application for special leave to appeal to the High Court.”

71 Counsel for the appellants then indicated to his Honour that those were issues that he wished to address and that he also wished to address the question of waiver. However, in my opinion, his Honour made it clear that he was doing no more than expressing a prima facie or tentative view as a consequence of his inspection of the documents. Thus, he said

prima facie

72 His Honour inspected the documents and expressed his views as a consequence thereof on the first day of the hearing, 18 March 2008. Argument then proceeded for the balance of that day and for the whole of the following day as well as for the final day of the hearing on 8 April. Much of the transcript is taken up with submissions made by counsel for the appellants. It would have been difficult for counsel to make submissions on whether the privilege was attracted prior to his Honour inspecting the documents. There is no doubt that there was ample opportunity for him to do so after they were inspected and, in particular, to argue, as he did, that the privilege had been lost as a consequence of consent or waiver under s 122. In my opinion no error in the procedure adopted by the primary judge has been demonstrated.

The allegation that the primary judge erred in finding that the Department’s legal officers were lawyers providing professional legal services

73 In Apple v Wily [2002] NSWSC 855 Barrett J, when dealing with an application for client legal privilege under ss 118 and 119 of the Evidence Act, said (at [11]):

“ ‘Client’ in its ordinary signification must therefore be regarded as referring to a person who, in respect of some legal matter within the scope of professional services normally provided by lawyers, has, with the consent of a lawyer, come to stand in a relation of trust and confidence … ”

74 The appellants submitted that in order for the privilege to apply it was necessary for the respondents to establish, otherwise than by inspection of the documents which purported to be the product of professional legal services, that the Departmental legal officers were providing such services.

75 In my opinion there is no substance in this submission and it should be rejected.

The allegation that the primary judge failed to understand the responsibilities and obligations of the Director-General as prosecutor of Mr Bailey

76 This ground of challenge, such as it is, was based upon the following paragraphs from the joint judgment of Gleeson CJ, Gummow, Kirby, Hayne, Heydon and Crennan JJ in A v New South Wales [2007] HCA 10; (2007) 81 ALJR 763 at 773 [39] and 774 [49] where their Honours said:

“39. The standard form of pleading alleges that the defendant acted (maliciously and) without reasonable and probable cause. A plaintiff who sets out to prove that allegation may, or may not, endeavour to establish, by direct evidence (including admissions), or inference, something about a defendant’s belief. In a jury trial that may raise an issue for the jury. At a trial without a jury, that may raise for the judge’s decision a specific question of fact. The nature of the question may depend upon what, in the circumstances of the case, is said to demonstrate that a defendant did not have reasonable and probable cause to prosecute. Those circumstances, in turn, may be affected by the nature of the allegations, and the prosecutor’s capacity to form an opinion about their strength and reliability.

…

49. It is also important to recognise that the assumption that a prosecutor would have personal knowledge of the facts alleged to found a criminal prosecution may appear to be at odds with modern notions of elaborate arrangements within the executive branch of government for the detection and prosecution of crime. It is, however, an assumption that reflects important and long-established features of criminal procedure. …”

77 Accepting for present purposes that the Director-General, as prosecutor of Mr Bailey in the Land and Environment Court, was required to accept the responsibility and accountability imposed upon him by the tort of malicious prosecution, that fact does not, in my view, in any way impinge upon the entitlement of the Director-General to claim client legal privilege with respect to the subject documents. Any suggestion to the contrary is, in my view, without merit.

The allegation that the primary judge erred in failing to find that the claim for client legal privilege was lost either by consent or waiver under s 122 of the

Evidence Act

78 Section 122 of the Evidence Act relevantly provides as follows:

“(1) This Division does not prevent the adducing of evidence given with the consent of the client or party concerned.

(2) Subject to subsection (5), this Division does not prevent the adducing of evidence if the client or party concerned has acted in a way that is inconsistent with the client or party objecting to the adducing of the evidence because it would result in a disclosure of a kind referred to in section 118, 119 or 120.

(3) Without limiting subsection (2), a client or party is taken to have so acted if:

(a) the client or party knowingly and voluntarily disclosed the substance of the evidence to another person, or

(b) the substance of the evidence has been disclosed with the express or implied consent of the client or party.”

79 At [83] the primary judge noted that the appellants’ submissions with respect to “consent” in s 122(1) were largely based on a single document, namely, Document 76 listed in Part 1(b) of the List. However, at [89] his Honour referred to a broader claim by the appellants to the effect that the respondents had consented to the disclosure of all documents in the List which his Honour described in the following terms:

“Other submissions made by counsel for the [appellants], which were not based on document 76, included that the first [respondent] by withdrawing his claim for privilege in respect of some of the documents in a category of documents described in a schedule to the [appellants’] notice of motion should be held to have consented to the disclosure of all other documents falling within the same category and that the supplying of the information about each document in the ‘how document came into existence’ column in exhibit D1 amounted to an implied or imputed consent to the disclosure of each document.”

80 At [107] his Honour rejected the submissions of the appellants not based on Document 76. He said:

“I reject the other submissions made by counsel for the [appellants] which were not based on document 76. The categories of documents described in the Schedule to the [appellants’] notice of motion were categories devised by the [appellants’] legal representatives and were broad and fairly arbitrary. I do not consider that the information supplied about each document in the ‘how document came into existence’ column in exhibit D1, which was brought into existence only in the course of the present application and as a submission opposing the [appellants’] application, should be regarded as amounting to an implied or imputed consent to the disclosure of documents.”

81 Although on the appeal the appellants reasserted the submission made to but rejected by the primary judge, no submission was put which, in my view, disclosed any error on the part of his Honour’s conclusion at [107]. Furthermore, notwithstanding the appellants’ oft repeated assertion that they were entitled to fairness, any overriding principle of fairness operating at large was rejected by Gleeson CJ, Gaudron, Gummow and Callinan JJ in Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1 at 13 [29] where their Honours said:

“What brings about the waiver is the inconsistency, which the courts, where necessary informed by considerations of fairness, perceive, between the conduct of the client and maintenance of the confidentiality; not some overriding principle of fairness operating at large.”

82 The suggestion of the appellants, that by the Director-General withdrawing his claim for privilege in respect of some of the documents but maintaining it with respect to others, he should be held to have consented to the disclosure of all, is with respect, unsustainable. The same observation applies to so much of Exhibit D1 under the heading “How document came into existence”. That column was treated as a submission as to the reasons why the documents to which it referred should be privileged. The suggestion that that submission constituted an implied or imputed consent to its disclosure was properly rejected by the primary judge as being without foundation.

83 A substantial part of the argument both before the primary judge and this Court related to Document 76. In the column in Part 1(b) of the List headed “Nature of document/s”, it was described in the following terms:

“Department of Land and Water Conservation Strategy and Policy – recommendation for Director-General’s approval for the commencement of a prosecution against Bailey, by Lindsey Paget-Cooke, Legal Officer, Department of Land and Water Conservation.”

84 The issues with respect to Document 76 arose out of interrogatories 13, 14 and 15 administered by leave of the Court to the Director-General and the latter’s answers thereto. The interrogatories and their answers were as follows:

“13. Was a decision memorandum prepared by or for the person whom made the decision to prosecute the First [Appellant]?

A memorandum (‘the decision memorandum’) containing background matters, comment, legal advice and recommendations was provided to the Prosecutor.

14. What were the findings or material questions of fact made by the Prosecutor in deciding to prosecute the First [Appellant]? If the findings are recorded in a document/s provide copies of same with your answer.

In substance the material findings of fact are contained in the decision memorandum a redacted version of which (excluding legal advice) is annexed hereto.

15. What was the specific evidence and other material on which the Prosecutor’s findings were based in making the decision to prosecute? If the evidence and/or material are recorded in a document/s provide copies of the same with your answer.

(a) What was the understanding of the Prosecutor in deciding to prosecute as to the applicable law? Provide a copy/copies of any material relied on by the prosecutor in deciding to prosecute on the applicable law.

(b) What were the reasoning processes of the Prosecutor leading to the decision to prosecute?

In substance the evidentiary material on which the Prosecutor’s findings were based is referred to in the decision memorandum (see 14A above). Save as aforesaid the First

Respondent

objects to this interrogatory on the ground that any further answer to the interrogatory could disclose privileged information.

(a) In substance, the applicable law was the Native Vegetation Conservation Act 1997 (‘the NVC Act’). Save as aforesaid the First

Respondent

objects to this interrogatory on the ground that any further answer to the interrogatory could disclose privileged information.

(b) In substance, the prosecutor considered all material placed before him, discussed the matter with senior officers of the Department and agreed to proceed with the prosecution as recommended. Save as aforesaid the First Defendant objects to this interrogatory on the ground that any further answer to the interrogatory could disclose privileged information.

85 The document annexed to Answer 14A was Document 76 and was in the following terms:

Strategy and Policy
NATIVE VEGETATION CONSERVATION ACT–PROSECUTION–BAILEY

Native Vegetation Conservation Act

NVC Act

Water Act

NVC Act

86 The document so annexed was “redacted” or edited from the original document in that the parts of the original for which client legal privilege was still claimed, were covered up. A copy of the redacted document became Exhibit 8, a description his Honour found convenient to refer to, as do I.

87 As the respondents were claiming privilege with respect to part of Document 76, it was permissible for them to redact that part: Candacal Pty Ltd v Industry Research and Development Board [2005] FCA 649; (2005) 223 ALR 284 at 295 [53]–[54] per Lee J.

88 Although it was suggested during the course of argument on the appeal that the primary judge had only inspected the redacted version of Document 76, namely, Exhibit 8, and not the non-redacted version, in my view there is no substance in that submission. His Honour said that he had inspected all of the documents for the purpose of determining the claim for privilege and that he had upheld the claim for privilege in respect of the redacted part of Document 76. He therefore must have seen it in its original form.

89 The appellants further submitted that there was no evidence that Attachment 1 referred to in paragraph 2.9 of Exhibit 8 had been inspected by his Honour for the purpose of determining whether it was privileged. The respondents submitted that Attachment 1 was Document 82 in Part 1(b) of the List which was dated 28 May 2002 and was described in the following terms:

“Department of Land and Water Conservation Internal Memorandum from Elizabeth Savage, Natural Resource Project Officer, Barwon Region to Sally Frazer, Manager, Legal & Compliance Branch, re recommendation for prosecution and section 47 Remedial notice under Native Vegetation Conservation Act 1997.”

90 Any suggestion that Document 82 was not the Attachment 1 referred to in paragraph 2.9 of Exhibit 8 is inconsistent with paragraph 20 of the appellants’ written submissions to the primary judge dated 14 March 2008 where Document 82 is said to have been the

“document expressly referred to by incorporation in the document produced (document 76) … ”

91 At [102] of his judgment his Honour referred to paragraph 2.9 of Exhibit 8 as relating to a recommendation received from the Region, which had been “redacted”. He rejected the submission that privilege had been waived with respect to the redacted part of the document as

“no part of the recommendation is disclosed, and accordingly there would be no inconsistency between the conduct of the [Director-General] and the maintenance of the privilege with respect to the recommendation from the Region.”

92 The appellants then submitted that a consideration of paragraphs 3.4, 3.5, 3.6, 3.7 and 3.9 of Exhibit 8 indicated the necessary degree of inconsistency between the respondents’ conduct on the one hand and their claim for confidentiality of the redacted part of the document on the other, so as to constitute waiver. The primary judge (at [103]) rejected this argument with respect to paragraphs 3.4 and 3.5 and nothing has been advanced to indicate that he was in error in so doing. It should be noted that his Honour does not refer to any submission put to him based on paragraphs 3.6, 3.7 and 3.9 of Exhibit 8. A glance at those paragraphs reveals why they were not relied on.

93 However, the primary judge did regard paragraph 3.8 of Exhibit 8 as constituting a waiver with respect to the assessment of the alleged offences according to the DPP Prosecution Policy and Guidelines to which that paragraph referred. The documents relating to that assessment have now been produced and nothing further turns on that paragraph.

94 The appellants did, however, maintain that his Honour was in error in failing to find that the respondents had waived privilege with respect to the redacted portion of Exhibit 8. Essentially, the appellants advanced four propositions in support of that submission. The first, based on the decision of Besanko J in Egglishaw v Australian Crime Commission (No 2) [2009] FCA 12 at [16]–[18], maintained that it was not open to the respondents to mask the redacted part of Exhibit 8 without the consent of the appellants or the leave of the Court.

95 The second was that, not having objected to interrogatories 13, 14 and 15 at the time the order was made that they be administered on the ground that answers to them would require disclosure of documents for which client legal privilege was claimed, it was too late for a claim for privilege to be made when those interrogatories were answered. This submission was sought to be based upon the decision of McDougall J in Auburn Council v Austin Australia Pty Ltd [2007] NSWSC 85 at [19].

96 The third was that having claimed client legal privilege with respect to the whole of Document 76, by attaching it to their answer to interrogatory 14, they had waived privilege with respect to so much of the document as was redacted as well as with respect to Attachment 1.

97 The fourth proposition was that the prosecutorial duty of disclosure of all facts relevant to the defence of a person charged with a criminal offence required the disclosure of documents which would otherwise attract the privilege but for the requirement to comply with that duty. The appellants conceded that this last proposition was not advanced before the primary judge.

98 As to the first proposition, in my opinion the decision of Besanko J in Egglishaw has no application to the present case. It was not a case that was concerned with a claim for client legal privilege. Rather, parts of discovered documents were masked to conceal those parts that were irrelevant to the issues in the case. His Honour noted that it was an established rule of practice for a party to seal or cover up parts of a document that were claimed to be irrelevant. His Honour also acknowledged that that practice had been followed in Australia. However, at [18] he noted the submission that the rule of practice did not apply under the Rules of the Federal Court. It was submitted to his Honour that a party making discovery was not entitled to seal up or mask parts or sections of a document unless he had the consent of the other party or the permission of the Court.

99 It would seem that his Honour upheld the principle upon which that submission was based so that, where there is a general order for discovery, the whole document must be produced unless there is agreement to the contrary by the party to whom discovery is being made or unless release from the requirement to discover the whole document (such as by masking certain portions of it) is obtained from the Court: see Telstra Corporation v Australis Media Holdings (Supreme Court of New South Wales, McLelland CJ in Eq, 10 February 1997, unreported).

100 However, this principle has no application to the present case. Rule 21.3(1) of the UCPR requires the relevant party to comply with an order for discovery by serving on the other party a list of documents that deals with all of the documents referred to in the order. The list must identify any document for which privilege is claimed. But inspection of the documents in the list is a separate matter. Thus r 21.5(2)(a) of the UCPR requires the party responsible for the list on request of the other party to produce for that party’s inspection the documents described in the list “other than privileged documents”. There is no reason why the exclusion of the privileged documents or parts thereof cannot be achieved by the form of redaction which occurred in the present case. I would therefore reject the appellants’ submissions based upon the decision Egglishaw.

101 I turn then to the second proposition. Rule 22.1 of the UCPR relevantly provides as follows:

“(1) At any stage of the proceedings, the court may order any party to answer specified interrogatories.

(2) An application for such an order must be accompanied by a copy of the proposed interrogatories.

…

(5) An order to answer interrogatories:

(a) may require the answers to be given within a specified time …”

102 Rule 22.2 is in the following terms:

“A party may not object to being ordered to answer an interrogatory except on the following grounds:

(a) the interrogatory does not relate to any matter in issue between that party and the party seeking the order,

(b) the interrogatory is vexatious or oppressive,

(c) the answer to the interrogatory could disclose privileged information.”

103 Rule 22 replaced Part 24 of the Supreme Court Rules 1970 (the repealed rules). Part 24 r 1(1) provided that a party may

“serve on any other [party] a notice requiring the party served to answer not more than 30, or such other number as the Court may by order specify, separate specified interrogatories relating to any matter in question between the interrogating party and the party served.”

104 Part 24 r 2(1) provided that a party required under r 1 to answer interrogatories must do so within a specified time. Part 24 r 5(1) empowered the court at any stage of any proceedings to order any party

“to serve on any other party, (whether the interrogating party or not): (a) a statement in accordance with rule 6 in answer to interrogatories specified or referred to in the order relating to any matter in question in the proceedings … ”

105 Part 24 r 6(3) relevantly provided as follows:

“(3) Subject to subrule (4), a party may object to answering any interrogatory on the following grounds but no other:

(a) where the answer is not required by an order, that the interrogatory does not relate to any matter in question between him or her and the party requiring the answer;

(b) that the interrogatory is vexatious or oppressive;

(c) unless and until the Court directs that the question shall not be prevented by the subrule;

Evidence Act

(4) On an application under … rule 5 in respect of any interrogatory, the Court may require the applicant to specify on what grounds he objects to answer that interrogatory and may determine the sufficiency of the objection … ”

106 It is apparent from the foregoing that under the repealed rules, a party to whom specific interrogatories had been administered pursuant to an order of the court could object to answering any interrogatory on the ground that evidence in answer to a question in terms of the interrogatory was the subject of client legal privilege.

107 The appellants submitted that under r 22.2 of the UCPR that the correct and only time to object to answering an interrogatory upon the ground that the answer could disclose privileged information was when the order to answer it was made. As I have indicated, reliance was placed upon the decision of McDougall J in Auburn Council in support of that proposition.

108 In Auburn Council the plaintiff had delivered draft interrogatories for the consideration of the defendant well in advance of any order made under r 22.1(1) of the UCPR. At the time the order was made no objection was taken to answering the interrogatories so proposed. It was when the answers to the interrogatories were provided that objection was taken to answering a number of them upon various grounds, none of which included that referred to in rule 22.2(c).

109 After setting out the effect of rules 22.1, 22.2 and 22.3, McDougall J noted (at [9]) the plaintiff’s submission that the time for objecting on the grounds specified in r 22.2 passed no later than the time the order was made. The plaintiff had submitted that it was not open to the defendant to take a threshold objection at any later time.

110 The defendant had submitted that the mechanism laid out in r 22 of the UCPR had not been engaged but his Honour held to the contrary finding that the Court had exercised its power under r 22.1 to order the defendant to answer specified interrogatories. In those circumstances his Honour considered (at [19]) that the time for objection to specific interrogatories passed no later than the time when the order was made. Had the defendant wished to take the position that it did, it should have done so before the court ordered that they be answered.

111 There is obviously much to be said for the view that the proper time to object to being ordered to answer a specific interrogatory upon the ground that it does not relate to any matter in issue between the parties or that it is vexatious or oppressive, is at the time the order to answer the interrogatory is made. Each of the first two grounds referred to in r 22.2 relate to the form of a specific interrogatory or to whether it seeks an answer which is relevant to the issues between the parties. The third ground of objection, namely that the answer could disclose privileged information, might not be known at that point and is potentially in a different category to the first two grounds.

112 There is a subtle, albeit unexplained, change in language between Part 24 r 6(3) of the repealed rules on the one hand and r 22.2 of the UCPR on the other. The former permitted a party to object to answering any interrogatory on the same grounds as are now set out in sub-paragraphs (a), (b) and (c) of r 22.2. The opening words of r 22.2 are different to the opening words of Part 24 r 6(3) for in lieu of providing that a party may object to answering any interrogatory on the specified grounds, the rule now provides that a party may not object to being ordered to answer an interrogatory except on those grounds.

113 As I have observed, there is something to be said for the view that an objection on grounds (a) and (b) should be taken at the time that consideration is given to the making of an order to answer specific interrogatories. But the same considerations do not, in my view, apply to ground (c). In any event, I do not construe r 22.2 as prohibiting an objection to answering an interrogatory on any of the three stated grounds where that objection is not taken at the time that the order that specified interrogatories be answered is made.

114 As a matter of discretion the court may well consider that a failure to take an objection to answer a specified interrogatory at the time the order is made results in the outcome that such an objection ought not to be permitted at the time the interrogatory is answered. Possibly some form of waiver may come into play. But I see no reason in principle why, at least in appropriate cases, an objection to answering a specified interrogatory upon the basis that it would disclose privileged information cannot be taken at the time that the answer to that interrogatory is called for.

115 In any event, as I have indicated, Auburn Council did not involve an objection on the basis that the answer to the specified interrogatory could disclose privileged information. Furthermore, in the present case the relevant orders made by Adams J relating to interrogatories were as follows:

“5. Order that the [appellants] administer interrogatories on or before 20 September 2007.

6. Order the [respondents] to provide their answers to interrogatories on or before 19 October 2007.”

116 At the time those orders were made no draft of the proposed interrogatories had been provided by the appellants to the respondents. When this was drawn to the attention of his Honour so as to enable the respondents to indicate their response to any proposed interrogatories, he specifically stated that the appellants could supply the respondents with the proposed interrogatories and

“if you [the respondents] object to any, you will state ‘we refuse to answer’ or ‘we object to this interrogatory’ …”

117 The orders made by Adams J on 27 July 2007 were amended by him on 27 August 2007 when he ordered that the appellants administer interrogatories on or before 11 October 2007 and that the respondents provide their answers on or before 19 October 2007. These orders were by consent further amended by the Registrar on 2 November 2007 when he ordered the appellants to administer interrogatories by 14 December 2007 and the respondents to answer them on or before 29 January 2008.

118 At the time the foregoing orders were made, no interrogatories, whether in draft form or otherwise, had been provided to the respondents. As his Honour noted at [84] of his judgment, it was not until 19 November 2007 that the appellants’ solicitors forwarded interrogatories to the Crown Solicitor to be answered by the respondents on or before 29 January 2008. That date was, by consent, extended by the Registrar on 29 January 2008 to 22 February 2008.

119 It is therefore clear that at the time any orders were made for the respondents to answer interrogatories, whether by Adams J or by the Registrar, there were no specified interrogatories in respect of which an objection could be taken. On this basis alone it seems to me that r 22.2 had no application and that the decision of McDougall J in Auburn Council is distinguishable.

120 I turn now to the third proposition. The appellants submitted that the respondents should have claimed client legal privilege in respect of the whole and not just part of Document 76 and that by disclosing so much of that document as became Exhibit 8 in answer to interrogatory 14, they were acting inconsistently with their claim for confidentiality and had thereby waived privilege with respect to the whole document in its original form.

121 This submission was based upon the decision of the English Court of Appeal in Great Atlantic Insurance Co v Home Insurance Co [1981] 1 WLR 529; [1981] 2 All ER 485. In that case the plaintiff’s solicitors disclosed a document which comprised the first two paragraphs of a memorandum sent to the plaintiff by American attorneys in their capacity as the plaintiff’s legal advisers. The solicitors regarded the remainder of the memorandum as privileged but failed to make it clear that the memorandum contained additional matter in respect of which privilege was claimed. In opening the trial, counsel for the plaintiff read the document to the judge unaware that it was incomplete and without any intention of waiving any privilege. When later in the trial it emerged that the document did not represent the whole of the memorandum, the defendant applied for disclosure of the additional matter. The judge ordered disclosure of the whole memorandum and an appeal by the plaintiff to the Court of Appeal was dismissed.

122 It was held on appeal that the whole of the memorandum, being a communication to the plaintiff from their legal advisers, was privileged; that the memorandum dealt with a single subject matter and was not capable of being divided into two separate and distinct memoranda; and that accordingly, privilege could not be waived as to part and asserted as to the remainder.

123 Critical to the decision in Great Atlantic was the finding of the Court that the whole of the memorandum was a privileged communication between legal adviser and client. The question that therefore arose was whether the plaintiff could waive privilege with respect to the first two paragraphs of the memorandum but assert privilege over the balance. At 536 Templeman LJ relevantly said:

“In my judgment, severance would be possible if the memorandum dealt with entirely different subject matters or different incidents and could in effect be divided into two separate memoranda each dealing with a separate subject matter. The judge … came to the conclusion that the first two paragraphs of the memorandum and the additional matter dealt with the same subject matter. … But once it is decided that the memorandum deals with only one subject matter, it seems to me that it might be or appear dangerous or misleading to allow the plaintiffs to disclose part of the memorandum and to assert privilege over the remainder.”

124 The decision in Great Atlantic was distinguished by Hoffmann LJ (as he then was), with the agreement of Leggatt and Dillon LLJ, in GE Capital Corporate Finance Group Ltd v Bankers Trust Co [1995] 1 WLR 172; [1992] 2 All ER 993 where at 175, his Lordship said:

Great Atlantic

125 After citing the passage from the judgment of Templeman LJ which I have set out at [123] above, his Lordship continued:

“If this test is confined to the context in which it was applied, namely, the case of a party who puts in evidence part of a privileged document, I would not in any way differ. … The test for whether part can be withheld on grounds of privilege is simply whether that part is privileged. There is no additional requirement that the part must deal with an entirely different subject matter from the rest.”

126 Great Atlantic was referred to with apparent approval in Attorney-General (NT) v Maurice [1986] HCA 80; (1986) 161 CLR 475 by Gibbs CJ at 482 [8] and by Mason and Brennan JJ at 488 [11]. The Chief Justice cited the following passage, as did Templeman LJ in Great Atlantic at 538, from the judgment of Mustill J in Nea Karteria Maritime Co Ltd v Atlantic & Great Lakes Steamship Corporation [No 2] [1981] Com.L.R 138 at 139 where his Lordship stated the following test:

“… where a party is deploying in court material which would otherwise be privileged, the opposite party and the court must have an opportunity of satisfying themselves that what the party has chosen to release from privilege represents the whole of the material relevant to the issue in question. To allow an individual item to be plucked out of context would be to risk injustice through its real weight or meaning being misunderstood.”

127 Mason and Brennan JJ, when referring to Great Atlantic, said (at 488 [11]):

“In order to ensure that the opposing litigant is not misled by an inaccurate perception of the disclosed communication, fairness will usually require that waiver as to one part of a protected communication should result in waiver as to the rest of the communication on that subject matter. ...”

128 In Commissioner of Taxation v Coombes [1999] FCA 842; (1999) 92 FCR 240 at 255 [39], the Full Court of the Federal Court (Sundberg, Merkel and Kenny JJ) referred to the principle applied in Great Atlantic in these terms:

Maurice

129 Finally, in MAM Mortgages Ltd (in liq) v Cameron Bros (No 2) [2001] 1 Qd R 46 at 48, Wilson J considered as too inflexible the statement of Templeman LJ in Great Atlantic that the most straightforward rule was

“that if a document is privileged then privilege must be asserted, if at all, to the whole document unless the document deals with separate subject matters so that the document can in effect be divided into two separate and distinct documents each of which is complete.”

130 As Wilson J observed, the ultimate test is that of fairness in all the circumstances. Where only part of a document is disclosed but the balance is not, the question is whether the failure to disclose the part in respect of which privilege is claimed results in distortion of the part that is disclosed. If it does, then it would be unfair to sustain the non-disclosure of the other part.

131 The governing principle in the context of the present case is that articulated by Mason and Brennan JJ in Maurice at 487–488 [11] where their Honours said:

“An implied waiver occurs when, by reason of some conduct on the privilege holder’s part, it becomes unfair to maintain the privilege. The holder of the privilege should not be able to abuse it by using it to create an inaccurate perception of the protected communication.”

Osland v Secretary, Department of Justice

Evidence Act

132 In my opinion Great Atlantic stands only for the proposition that where the whole of a document is a privileged communication between legal adviser and client, the party entitled to claim that privilege cannot waive the privilege as to part of the communication but claim it with respect to the remainder if to do so would result in unfairness. Either privilege is claimed with respect to the whole or waived as to the whole. The only exception to this would be where the communication dealt with two entirely different subject matters in respect of which privilege was claimed for the one that was relevant to the issues at hand and waived for the other which was not.

133 The foregoing propositions have no application to the present case. Although client legal privilege was originally claimed as to the whole of Document 76, that claim was abandoned in respect of those parts of the document for which such privilege could not be legitimately sustained. However, it was maintained with respect to those parts of the document which constituted a privileged communication.

134 Contrary to the submission of the appellants, the disclosure of the part of Document 76 excluding legal advice in response to an order to answer Interrogatory 14 which was properly confined to ascertaining the material matters of fact relied upon by the Director-General in deciding to prosecute Mr Bailey, could hardly be categorised as a selective or partial disclosure by the respondents deployed for their own forensic advantage. Further, it would be for the appellants, if so advised, to tender the answer and, therefore, the annexed document, in their case for their own forensic advantage. No question presently arises of the respondents seeking to utilise the redacted part of the document in their case.

135 I have already referred (at [81] above) to the statement in the joint judgment in Mann v Carnell at 13 [29] that:

“[w]hat brings about the waiver is the inconsistency, which the courts, where necessary informed by consideration of fairness, perceive, between the conduct of the client and maintenance of the confidentiality.”

136 Often that inconsistency is evidenced by the nature of the proceedings which are brought by the party seeking to maintain the privilege. Thus, in New South Wales Bar Association v Archer [2008] NSWCA 164 at [48], Hodgson JA, with the relevant agreement of Campbell JA and Handley AJA, observed:

“It is not enough to bring about a waiver of client legal privilege that the client is bringing proceedings in which the content of the privileged communication could, as a reasonable possibility, be relevant and of assistance to the other party. For the client to do this is not inconsistent with the maintenance of the privilege and does not give rise to unfairness of the type in question. What would involve inconsistency and relevant unfairness is the making of express or implied assertions about the content of the privileged communications, while at the same time seeking to maintain the privilege. In this respect, it may be sufficient that the client is making assertions about the client’s state of mind, in circumstances where there were confidential communications likely to have affected that state of mind.”

137 In the present case it is the respondents who are claiming client legal privilege, not the appellants. Although in their Amended Statement of Claim the appellants allege that the Director-General commenced and maintained the prosecution against Mr Bailey maliciously and without reasonable and probable cause, thus putting in issue his state of mind, paragraph 18 of the Defence filed by the respondents does no more than deny those allegations. In other words, as the proceedings at present stand, the Director-General does not seek to make a case in defence to the appellants’ malicious prosecution claim that he acted upon legal advice. If at any time he does, then it would be open to the appellants to seek access to that legal advice and a real question as to waiver would then arise that could have particular repercussions with respect to costs of the proceedings before the primary judge and this Court with respect to the respondents’ present claim for client legal privilege.

138 However, as at the present time, there has been no relevant conduct on the part of the respondents that would constitute an implied waiver of the claim for client legal privilege for Attachment 1 to Document 76 or to that part of the document which has been redacted. In particular, the decision in Great Atlantic is of no assistance to the appellants and their submissions to the contrary should, therefore, be rejected.

139 The fourth and final matter under this heading relates to the appellants’ submission that the Director-General, as prosecutor, had a duty to make available all material that may have proved helpful to Mr Bailey in his defence of the charges against him and that such material should have included all documents generated within the Department and upon which the decision of the Director-General to institute and maintain the prosecutions was founded. The relevant principles relating to the Crown’s duty of disclosure are conveniently set forth in the judgment of Hodgson JA, with whom Simpson and Barr JJ agreed, in R v Reardon (No 2) [2004] NSWCCA 197; (2004) 60 NSWLR 454 at 468–469 [46]–[55]; see also, Mallard v The Queen [2005] HCA 68; (2005) 224 CLR 125 at 153 [73]–[74] per Kirby J; R v Brown [1998] AC 367 at 374–377 per Lord Hope of Craighead.

140 As I understand those principles, the Crown as prosecutor is, as a matter of fairness, required to disclose to the defence any material in its possession that may undermine its case or which may assist the defence case. In Reardon, Hodgson JA (at 468 [48]) referred to the decision of the English Court of Appeal in R v Keane [1994] 1 WLR 746; [1994] 2 All ER 478 at 751–752 and noted that subject to the question of public interest immunity, the prosecution must disclose documents which are material. Documents are material if they can be seen, on a sensible appraisal by the prosecution, to:

(a) be relevant or possibly relevant to an issue in the case;

(b) raise or possibly raise a new issue, the existence of which is not apparent from the prosecution case; or

(c) hold out a real (as opposed to a fanciful) prospect of providing a lead on evidence going to either (a) or (b).

141 There are a number of difficulties with the appellants’ reliance upon this line of authority. First, as I have already indicated, it was not a point taken before the primary judge. Second, it is true that it was held by Martin J in R v Bunting [2002] SASC 412; (2002) 84 SASR 378 at 395 [61] that:

”if receipt of … relevant information in an otherwise privileged communication coincides with the requirement of [prosecutorial] disclosure, legal professional privilege does not apply to the information received in the communication because the [prosecutor] does not intend that the information will be confidential.”

142 However, whether this “loss” of privilege is due to imputed waiver as his Honour seems to suggest at 398–399 [73]–[74] or whether it falls within the “exceptions” to the privilege in the sense that it does not attach at all to such communications in the manner referred to by Deane J in Carter v Northmore Hale Davey & Leake [1995] HCA 33; (1995) 183 CLR 121 at 134–135, need not be considered. What is presently relevant, as Martin J noted in Bunting at 395 [60], is that the question as to whether a communication is privileged is determined by reference to the facts that exist at the time of the communication. In particular, the requirement of disclosure may not exist at that time.

143 His Honour elaborated upon this point in the following terms (at 395–396 [62]):

“A difficulty remains, however, where the requirement of disclosure does not coincide with receipt of the relevant information. The duty of disclosure only exists in the context of prosecution proceedings. The duty is not ‘activated’ until the information becomes relevant information in the context of such proceedings. Information is frequently received in a privileged communication before a prosecution is commenced and before it is known that the information is relevant information for disclosure purposes. In those situations, as the communication is privileged at the outset, the principles emphatically endorsed by the High Court appear to pose an insurmountable obstacle to determining that the information ceases to be confidential or to regarding the circumstances as an exception to the application of legal professional privilege which is created at the time that the duty of disclosure is ‘activated’. ”

144 The appellants therefore face four insurmountable obstacles. First, it is not self evident and the primary judge did not consider (as the point was not raised before him) when inspecting the redacted parts of Document 76 or, for that matter, any of the other documents for which privilege was claimed, whether the prosecutorial duty of disclosure would have applied to them at the time they came into existence.

145 Second, as the duty of disclosure only exists in the context of prosecution proceedings, the fact that it may have been breached does not, in my view, require it to be complied with in the context of the present civil proceedings.

146 Third, the relevant communications in respect of which privilege is claimed came into existence prior to any decision being taken by the Director-General to commence the prosecution of Mr Bailey. At the time they came into existence, it was not known whether the information they contained was relevant information for the purpose of the duty of disclosure. As the communications were privileged from the outset, that is, from the time they came into existence, they remained confidential even if at a later point in time the duty of disclosure arose.

147 Fourth, whether or not the duty of disclosure ever arose in the circumstances of this particular prosecution has not been demonstrated. The prosecution proceeded on an agreed statement of facts and depended for its outcome on what was essentially a matter of statutory construction. Although it would appear that both sides filed affidavits after the proceedings in the Land and Environment Court were instituted in respect of which there were some differences, these were nevertheless resolved into an agreed statement of facts. Why that should require the Director-General, pursuant to his asserted duty as prosecutor, to disclose documents in respect of which he had a legitimate claim for client legal privilege, was neither elaborated upon nor disclosed by the appellants in argument. In my opinion their submissions based on the prosecutorial duty of disclosure should be rejected.

148 For the foregoing reasons, in my opinion the appellants have not demonstrated that the primary judge erred in rejecting their submission that the respondents had consented to or waived, impliedly or otherwise, their claim for client legal privilege except to the limited extent referred to by his Honour at [106] and [108] of his judgment.

The appellants’ application to adduce fresh evidence

149 On or about 27 June 2008 the appellants filed a Notice of Motion seeking an order that the further evidence contained in an affidavit of Mr Bailey sworn 4 June 2008 be received by this Court pursuant to s 75A(7) of the Supreme Court Act 1970. In that affidavit Mr Bailey deposed that on or about 15 May 2008 he had a telephone conversation with Ms Elizabeth Savage of the NSW Catchment & Management Authority (the CMA). The List refers to a number of documents of which Ms Savage, who was then the Natural Resource Project Officer of the Barwon Region of the Department, was apparently the author.

150 In their telephone conversation Ms Savage referred to Mr Bailey’s case against the respondents. Mr Bailey informed her that the Department was fighting “tooth and nail” to prevent the appellants from seeing a large number of documents over which they had claimed privilege. Ms Savage allegedly responded:

“One of those documents might be a document that I wrote recommending not to pursue you over the clearing of the Strip. You were badly done by in the prosecution against you, they shouldn’t have proceeded. There was no need for it.”

151 The affidavit also deposed to the further following statement of Ms Savage:

“When I wrote the report I was the acting manager of Moree and I recommended to the Barwon Region of the Department that they do not prosecute you. I told them that the prosecution should not proceed and that your Part 8 Application should be Approved.”

152 This conversation took place, as the affidavit indicated, on 15 May 2008 after argument before the primary judge had been completed, but whilst judgment was reserved. No attempt was made to bring it to his Honour’s notice.

153 In my opinion the application should, in the exercise of the Court’s discretion, be refused. Although the conditions necessary to constitute “special grounds” within the meaning of s 75A(8) have no necessary application to the present case, nonetheless the relevance of the further evidence to the issues in the appeal and whether that evidence is likely to result in a different outcome are material considerations to whether the Court’s discretion to admit such evidence should be exercised.

154 Thus the difficulty I have with Mr Bailey’s evidence is its relevance to the issues in the appeal. If accepted, it reveals that one of the Departmental officers wrote a report recommending that the prosecution of Mr Bailey not proceed. It cannot go to the issue of waiver as there can be no suggestion that Ms Savage had authority to waive privilege particularly as at the time she made the statement to Mr Bailey, she was, apparently, no longer an officer of the Department.

155 In their supplementary submissions dated 23 February 2009, the appellants relied on their written submissions dated 20 June 2008, but there was no reference in those submissions to the fresh evidence upon which reliance is now placed. However, it was submitted that its relevance went “inter alia” to addressing the appellants’ submission to the Court on the appeal that Document 82 was Attachment 1 to Document 76 where no evidence had been led by the respondents to support that conclusion.

156 However, as I have already indicated at [90] above, paragraph 20 of the appellants’ Outline of Submissions to the primary judge asserted that Document 82 was expressly referred to by incorporation in Document 76 and there was no suggestion on the part of the appellants that the document so incorporated was other than Attachment 1 – being a memo addressed to Legal and Compliance dated 28 May 2002 and which accords with the description of Document 82 in the List.

157 Accordingly the application by the appellants to adduce the evidence in Mr Bailey’s affidavit of 4 June 2008 should be refused. I should add for completeness that paragraphs 6–8 of the appellants’ supplementary written submissions went beyond the leave they were granted to file further submissions and, therefore, have been ignored.

Costs

158 The appellants submit that even if the Court dismisses their appeal, it should nevertheless in the circumstances (to which reference will be made), exercise its discretion to order the respondents to pay the appellants’ costs of the appeal as well as of the hearing before the primary judge. Reliance was placed upon s 98(4) and (6) of the Civil Procedure Act 2005 and r 42.1 of the UCPR.

159 Reliance on s 98(4) and (6) appears to be misplaced. Costs are at the discretion of the Court (s 98(1)) but, by virtue of r 42.1, it is to order that costs follow the event unless it appears to it that some other order should be made.

160 The reasons advanced by the appellants in support of a special order for costs in their favour are set out in their written submissions on costs dated 26 February 2008 in the following terms:

”a. The Respondents’ conduct wasted or unnecessarily increased the cost of the resolution of the discovery issues in dispute and/or unduly lengthened the proceedings:

i. No less than 5 significant breaches of the Rules as to disclosure by categories occurred…;

ii. This denied to the applicants the reasonable opportunity afforded by the Rules to see, by reference to sworn affidavits of documents from each Respondent and specification of the circumstances of the claims for privilege made by each of them, the basis of the 340 privilege claims including group claims in Part 1(b) of the Joint List;

It is an understatement to say that the evidence is deficient

iv. No cross examination was possible of any witness from the Respondents’ camp who knew anything about the documents or the circumstances of the claims for privilege, and the two witnesses who did give evidence on the legal status of some of the DLWC officers did not attend at all although called to do so;

v. These breaches were admittedly deliberate and not by a mistake or for some other good reason …;

very unsatisfactory

and

belief

A v NSW

model litigant

161 The judgment of the primary judge in the White Book does not deal with the question of costs of the hearing before him. Many if not most of the grounds relied upon by the appellants set out above are relevant only to the exercise of his Honour’s discretion to order costs on the Notice of Motion which was before him. I am unaware whether that discretion has yet been exercised. The White Book does contain the formal order made by the primary judge on 22 May 2008 (being the date he delivered judgment) and a variation of that order made on 30 May 2008. However, whereas the order of 22 May 2008 refers to discovery of certain documents by the respondents, that of 30 May refers to discovery of certain documents by the appellants. Neither contains an order for costs.

162 Furthermore, the appellants’ Draft Notice of Appeal, although seeking that the orders made by his Honour on 30 May 2008 be set aside, contains no ground of appeal to suggest that he was in error in making whatever order for costs he did make, assuming that he has made one at all.

163 Accordingly, in my view there is nothing before the Court which would enable us to review any order for costs made by the primary judge with respect to the appellants’ Notice of Motion.

164 As to the costs of the appeal, in my view none of the matters relied upon justify a departure from the rule that costs should follow the event. Whatever criticism might be levelled at the respondents as to compliance with the rules when claiming privilege and/or with respect to the evidence filed at first instance in support of that claim, the fact is that, for my part, each and every challenge by the appellants based on the matters now relied upon in support of a special costs order, has failed.

165 Although it may be said that the breaches of procedure and process so referred to were deliberate, reasons were given with respect to the paucity of the particulars and evidence which, in my view, were not without some justification, at least with respect to the evidence, or lack thereof, filed to support the claim for privilege. Furthermore, I do not believe it to be the case that State agencies such as the respondents are to be regarded as having “unlimited resources”. If it was ever true, it certainly is not so now. After all, those “resources” are sourced from the State’s taxpayers. They are required to be carefully and responsibility disbursed. A private litigant is not so constrained.

166 It does not assist the appellants’ application to assert, as they do at paragraph 2(viii) of their submissions on costs, that the conduct of the respondents has deprived them of access to documents that relate to the critical question of the belief of the Director-General in commencing the prosecution of Mr Bailey. No doubt they would like to obtain access to those documents but the claim for privilege was upheld by the primary judge and should be confirmed. This is a “bootstrap” argument without merit.

167 Accordingly, for the foregoing reasons I decline to accede to the appellants’ submission that this Court should make an order on the appeal other than that costs should follow the event.

Conclusion

168 In my opinion each of the challenges to the primary judge’s decision has failed. I would therefore propose the following orders:

(a) Leave to appeal granted;

(b) Direct the appellants to file and serve their Notice of Appeal within 7 days of the date of this order;

(c) Appeal dismissed;

(d) The appellants to pay the respondents’ costs of the summons for leave to appeal and of the appeal.

**********

Citations

Bailey v Department of Land and Water Conservation [2009] NSWCA 100

Most Recent Citation

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Lewis v Lewis [2021] NSWCA 168

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Cases Cited

28

Statutory Material Cited

4

Mann v Carnell [1999] HCA 66

Craine v Colonial Mutual Fire Insurance Co Ltd [1920] HCA 64

Mann v Carnell [1999] HCA 66

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Reported Decision:	74 NSWLR 333
Appeal Outcome:	Special leave dismissed with costs by the High Court, 2 October 2010 s118/2009

CITATION:	Bailey v Department of Land and Water Conservation [2009] NSWCA 100
HEARING DATE(S):	19 February 2009
JUDGMENT DATE:	5 May 2009
JUDGMENT OF:	Allsop P at 1; Hodgson JA at 6; Tobias JA at 7
DECISION:	(a) Leave to appeal granted; (b) Direct the appellants to file and serve their Notice of Appeal within 7 days of the date of this order; (c) Appeal dismissed; (d) The appellants to pay the respondents’ costs of the summons for leave to appeal and of the appeal.
CATCHWORDS:	PROCEDURE – Discovery and interrogatories – Discovery and inspection of documents – Production and inspection – Grounds for resisting production – Legal professional privilege – Client legal privilege – What constitutes – Whether party supplied sufficient evidence in support of claim for privilege – Whether primary judge was entitled to inspect documents to determine whether they attracted privilege under the Evidence Act and common law – Identification of the “client” for the purposes of s 119 of the Evidence Act – Whether in-house lawyers of Department provided professional legal services – Waiver of privilege – Implied waiver and disclosure waiver – Whether an objection to answering a specified interrogatory on the basis that this would disclose privileged information can be made at the time the answer to the interrogatory is called for – Whether production of certain parts of a redacted document amounted to implied waiver of the claim for privilege over the redacted parts – Whether disclosure of redacted document created inconsistency or unfairness – Whether the prosecutorial duty of disclosure of documents material to the defence prevented privilege from attaching - COSTS – General rule – Costs follow the event – Whether departure from the general rule justified in the circumstances - EVIDENCE – Affidavits – Use of affidavits – Whether affidavits should have been admitted where deponents not cross-examined - APPEAL – Admission of fresh evidence
LEGISLATION CITED:	Civil Procedure Act 2005 Evidence Act 1995 Native Vegetation Conservation Act 1997 Supreme Court Act 1970
CASES CITED:	A v New South Wales [2007] HCA 10; (2007) 81 ALJR 763 Apple v Wily [2002] NSWSC 855 Attorney-General (NT) v Maurice [1986] HCA 80; (1986) 161 CLR 475 Auburn Council v Austin Australia Pty Ltd [2007] NSWSC 85 Barnes v Commissioner of Taxation [2007] FCAFC 88 Candacal Pty Ltd v Industry Research and Development Board [2005] FCA 649; (2005) 223 ALR 284 Carter v Northmore Hale Davey & Leake [1995] HCA 33; (1995) 183 CLR 121 Commissioner of Taxation v Coombes [1999] FCA 842; (1999) 92 FCR 240 DSE (Holdings) Pty Ltd v Intertan Inc [2003] FCA 384; 127 FCR 499 Egglishaw v Australian Crime Commission (No 2) [2009] FCA 12 Esso Australia Resources v Commissioner of Taxation [1999] HCA 67; (1999) 201 CLR 49 Federal Commissioner of Taxation v Rio Tinto Ltd [2006] FCAFC 86; 229 ALR 341 GE Capital Corporate Finance Group Ltd v Bankers Trust Co [1995] 1 WLR 172; [1992] 2 All ER 993 Great Atlantic Insurance Co v Home Insurance Co [1981] 1 WLR 529; [1981] 2 All ER 485 Hooker Corporation Ltd v Darling Harbour Authority (1987) 9 NSWLR 538 Mallard v The Queen [2005] HCA 68; (2005) 224 CLR 125 MAM Mortgages Ltd (in liq) v Cameron Bros (No 2) [2001] 1 Qd R 46 Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1 Nea Karteria Maritime Co Ltd v Atlantic & Great Lakes Steamship Corporation [No 2] [1981] Com.L.R 138 New South Wales Bar Association v Archer [2008] NSWCA 164 Osland v Secretary, Department of Justice [2008] HCA 37; (2008) 234 CLR 275 R v Brown [1998] AC 367 R v Bunting [2002] SASC 412; (2002) 84 SASR 378 R v Keane [1994] 1 WLR 746; [1994] 2 All ER 478 R v Reardon (No 2) [2004] NSWCCA 197; (2004) 60 NSWLR 454 Singapore Airlines v Sydney Airports Corporation [2004] NSWSC 380 State of New South Wales v Jackson [2007] NSWCA 279 Standard Chartered Bank of Australia v Antico (1993) 36 NSWLR 87 Telstra Corporation v Australis Media Holdings (Supreme Court of New South Wales, McLelland CJ in Eq, 10 February 1997, unreported) Westpac Banking Corporation v 789Ten Pty Ltd [2005] NSWCA 321; (2005) 55 ACSR 519 Unsworth v Tristar Steering & Suspension Australia Ltd [2007] FCA 1082 Woollahra Municipal Council v Westpac Banking Corporation (1994) 33 NSWLR 529
PARTIES:	Bruce Clyde Bailey Janet Beatrice Shafik-Bailey Director-General of the Department of Land and Water Conservation now known as Director-General Department of Natural Resources New South Wales Water Administration Ministerial Corporation State of New South Wales
FILE NUMBER(S):	CA 40184/08
COUNSEL:	A: P E King / C P Carter R: G C Lindsay SC / J Harvey
SOLICITORS:	A: Hicksons Lawyers, Sydney R: Crown Solicitor's Office, Sydney
LOWER COURT JURISDICTION:	Supreme Court
LOWER COURT FILE NUMBER(S):	SC 20448/06
LOWER COURT JUDICIAL OFFICER:	James J
LOWER COURT DATE OF DECISION:	22 May 2008