BP Australia Ltd v Stallwood - [2000] WASC 75

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: BP AUSTRALIA LTD -v- STALLWOOD [2000] WASC 75

CORAM: MASTER SANDERSON

HEARD: 31 JANUARY & 1 MARCH 2000

DELIVERED : 23 MARCH 2000

FILE NO/S: CIV 1173 of 1999

BETWEEN: BP AUSTRALIA LTD (ACN 004 085 616)
Plaintiff
AND
PAUL UNWIN STALLWOOD
Defendant

Catchwords:

Practice and procedure - Application to inspect documents otherwise privileged on grounds of implied waiver by pleading - Equitable defence of laches and acquiescence raised by defendant - Whether defendant entitled to inspect legal advice from plaintiff's solicitor

Legislation:

Nil

Result:

Inspection permitted

Representation:

Counsel:

Plaintiff: Mr M F Dwyer
Defendant: Mr E M Corboy

Solicitors:

Plaintiff: Corrs Chambers Westgarth
Defendant: Deacons Graham & James

Case(s) referred to in judgment(s):

Ampolex v Perpetual Trustee Co (1995) 37 NSWLR 405
Attorney‑General for the Northern Territory v Maurice (1986) 161 CLR 475
Benecke v National Australia Bank (1993) 35 NSWLR 110
Data Access Corp v Powerflex Services Pty Ltd (1994) AIPC 91‑112
Lindsay Petroleum Co v Hurd (1874) LR 5 PC 221
Mann v Carnell [1999] HCA 66
Perpetual Trustees (WA) Ltd v Equuscorp Pty Ltd [1999] FCA 925
Southern Equities Corporation Ltd v Arthur Andersen (1997) 70 SASR 166
Telstra Corporation Ltd v BT Australasia Pty Ltd (1998) 156 ALR 634
Wardrope v Dunne [1996] 1 Qd R 224

Case(s) also cited:

Adelaide Steamship v Spalvins (1998) 152 ALR 418
Equuscorp Pty Ltd v Kamishacorp Ltd [1999] FCA 681
Esso Australia Resources Ltd v The Commissioner of Taxation [1999] HCA 67
Goldberg v Ng (1995) 185 CLR 83
Orr v Ford (1989) 167 CLR 316
Pulitano v Ginbey [1999] WASC 5
State Energy Commission of Western Australia v The Griffin Coal Mining Company Ltd, unreported; SCt of WA (Master Seaman QC); Library No 5882; 9 May 1985

MASTER SANDERSON: This is the plaintiff's application seeking inspection of two specific documents discovered by the defendant. The defendant filed what is described as Further Affidavit of Robert William Morrison ("Morrison"), sworn 10 August 1999, providing further discovery in this action. The First Schedule Pt II to the affidavit contains a description of documents in the following form (No 358):
"(5)Letters, facsimiles, written communications, notes, memoranda and other documents brought into existence between 30 December 1997 and 24 August 1998 and contained in the Plaintiff's files relating to The Lakes Service Station.
(6)Letters, facsimiles, written communications, notes, memoranda and other documents brought into existence between 11 July 1995 and 1 May 1998 and contained in the original file of Jackson McDonald."
Pursuant to par 2 of the affidavit the plaintiff sought to claim privilege over these documents. Given that the documents relate to legal advice obtained by the plaintiffs from their solicitors, prima facie the documents would attract privilege and would not be available for inspection. The defendant argues that, given the nature of the case and in particular the claim raised by the plaintiff, privilege does not attach to these documents and they should be available for…

Grounds of appeal

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

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

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

Consideration

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

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

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Details

Case: [2000] WASC 75
Decision Date: 23 MARCH 2000

CaseChat Overview and Summary

The case of BP Australia Ltd v Stallwood involved the plaintiff seeking to inspect documents that the defendant claimed were privileged, and the defendant raising an equitable defence of laches and acquiescence. The nature of the dispute was whether the defendant was entitled to inspect the legal advice obtained by the plaintiff's solicitor. The case was heard in the Federal Court of Australia.

The legal issue the court had to decide was whether the defendant was entitled to inspect the legal advice obtained by the plaintiff's solicitor, which was privileged. The court had to consider whether the defendant had impliedly waived the privilege by pleading in the statement of claim that it had acted "in reliance on" a particular representation made by the plaintiff. The court also had to consider the equitable defences of laches and acquiescence raised by the defendant.

The court examined the relevant common law principles in Telstra Corporation v BT Australasia and Perpetual Trustees v Equuscorp, both decisions of the Full Federal Court. The court held that the defendant had not impliedly waived the privilege by pleading in the statement of claim that it had acted "in reliance on" a particular representation made by the plaintiff. The court also held that the defendant's equitable defences of laches and acquiescence were not applicable in this case. The court concluded that the defendant was not entitled to inspect the legal advice obtained by the plaintiff's solicitor.

The court ordered that the defendant's application to inspect the legal advice obtained by the plaintiff's solicitor be dismissed.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

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Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

The approach adopted by courts to applications of this kind can be illustrated by an examination of two decisions - Telstra Corporation v BT Australasia and Perpetual Trustees v Equuscorp. Both these decisions are decisions of the Full Federal Court. Both concern not only common law principles but the operation of s 112 of the Commonwealth Evidence Act. That Act is not relevant in this case. Nonetheless, the common law principles were discussed in some detail in both cases. Dealing first with the Telstra case, the respondent pleaded in the statement of claim that it had acted "in reliance on" a particular representation made by the applicant. The respondent had taken legal advice prior to so acting. It was the applicant's contention that this being the case the legal advice obtained by the respondent was put in issue. Branson and Lehane JJ, who formed the majority, agreed. Their Honours said (at 648):"Where ... a party relies on a cause of action, an element of which is the party's state of mind (including the quality of the party's assent to a transaction) the party is taken to have waived privilege in respect of legal advice which the party had, before or at the time of the relevant events, material to the formation of that state of mind." In reaching this conclusion, their Honours quoted what was said by Gleeson CJ in Benecke v National Australia Bank (1993) 35 NSWLR 110, where his Honour said (at 111 ‑ 112):"The law permits the search for the truth in legal proceedings to yield, in certain circumstances, to the public interest in preserving the secrecy of communications between lawyer and client. In the present case, however, the appellant herself lifted the veil of secrecy by giving her version of the communications. Thereafter, there was no reason in principle why the pursuit of the truth should not take its course, or why the court should be inhibited in seeking to ascertain the true facts concerning those communications." Turning to the Perpetual Trustees case, the court (Ryan, Carr and Marshall JJ) summarised the factual position as follows (par 2):" ... Perpetual was the trustee of a unit trust in respect of which the public subscribed for units as part of a scheme for the production of a film released under the title "Double Impact". In summary, Equuas claims that between August 1989 and June 1990 the respondents made various misleading or deceptive representations to it in respect of the scheme, that in reliance upon those representations it executed a document (described in the further amended statement of claim as 'the security document'), advanced funds totalling $8.375 million by way of finance facility and suffered loss and damage by reason of the respondent's misleading or deceptive conduct. Equuas also claims rectification of the security document on the basis that the references therein to 'a letter of credit' do not faithfully record the common intention of the parties and were made under a mutual mistake of fact. Equus maintains that the common intention of the parties, namely that it was to provide a performance guarantee rather than a letter of credit, was not embodied in the security document. ...On 20 January 1999 Perpetual obtained the issue of a subpoena directed to Messrs Deacons Graham & James who were formerly Equus's solicitors ('Deacons'). The subpoena required Deacons to produce a file containing various documents created during the period 1 July 1989 to June 1991 when it was acting for Equus in relation to, amongst other things, the provision of the abovementioned finance facility. Deacons produced the file to the Court on 3 February 1999. Equus claimed that certain documents on the file were privileged from production on the ground of legal professional privilege. These were handwritten documents comprising records taken by solicitors, employed by Deacons' predecessor firm, of confidential instructions given by Equus during May and June 1990 in relation to the provision of security by Equus for production of the film, and confidential communications between that firm and Equus, consisting of legal advice (or drafts of legal advice) provided by them in the context of their professional relationship in that matter. ... "