Built Environs WA Pty Ltd v Perth Airport Pty Ltd [No 5]
[2021] WASC 237
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS
CITATION: BUILT ENVIRONS WA PTY LTD -v- PERTH AIRPORT PTY LTD [No 5] [2021] WASC 237
CORAM: KENNETH MARTIN J
HEARD: 24 & 25 JUNE 2021
DELIVERED : 25 JUNE 2021
PUBLISHED : 16 JULY 2021
FILE NO/S: CIV 1513 of 2016
BETWEEN: BUILT ENVIRONS WA PTY LTD
Plaintiff
AND
PERTH AIRPORT PTY LTD
Defendant
Catchwords:
Procedure - Discovery - Further and better discovery - Waiver - Imputed waiver - Inconsistency - Construction contract - Agent under contract performs multiple roles - One role is as independent certifier - Other roles more general - Disclosure of privileged advice from defendant's lawyers to agent - Distinction between certifier and other agency roles - Agreed disclosure of certifier disclosed advice - No waiver of other documents disclosed to agent in other capacity
Legislation:
Rules of the Supreme Court 1971 (WA)
Result:
Discovery orders made
Category: B
Representation:
Counsel:
| Plaintiff | : | Ms M Hindman QC & Mr T J Porter |
| Defendant | : | Mr D Miller SC & Mr V Ghosh |
Solicitors:
| Plaintiff | : | Baker McKenzie |
| Defendant | : | King & Wood Mallesons |
Case(s) referred to in decision(s):
Antony Leslie John Woodings as liquidator of the Bell Group Finance Pty Ltd v WA Glendinning and Associates Pty Ltd [2019] WASC 54
DSE (Holdings) Pty Ltd v Intertan Inc [2003] FCA 384; 127 FCR 499
Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49
Insurance Commission of Western Australia v Antony Leslie John Woodings as liquidator of the Bell Group Ltd (in liq) [No 6] [2018] WASC 249
Kane v Sopov [2005] VSC 237
Mann v Carnell (1999) 201 CLR 1
Northern Territory v GPAO (1999) 196 CLR 553
KENNETH MARTIN J:
(This judgment was delivered extemporaneously on 25 June 2021 and has subsequently been edited from the transcript).
Background
I am dealing with two separate applications by the plaintiff and defendant made under their respective chamber summonses, seeking production and further and better discovery.
I proceed with the use of electronic document references, by reason of the magnitude of the voluminous materials that have been filed in the present applications.
There has been something of an evolution in terms of the chamber summons being filed first by the defendant on 22 January 2021 (folio 196), followed then by the plaintiff's chamber summons of 25 January 2020 (folio 201). At that time, the matter was listed for a special appointment in early February 2020, before me. That plan was derailed due to various circumstances, including a COVID lockdown on this side of the country.
The respective applications were accompanied by the original written submissions of the plaintiff of 25 January 2021 and by the defendant, dated 22 January 2021. The parties then obviously engaged in a conferral process, because there followed an amended chamber summons by the defendant and plaintiff dated 3 June and 4 June 2021 respectively (folio 208 and 209). Strictly speaking, chamber summonses do not amend themselves. They need leave for such amendments. But if the changes are uncontroversial, then generally a court will grant leave.
There then followed the plaintiff's even further amended chambers summons of 21 June 2021 - which saw even further amendments in terms of the categories of documents pressed for - with some document concessions but also a few more augmentations in scope added (see folio 229).
The matter was relisted for a two-day hearing this week. It has still been something of a moving feast, to say the least. On Wednesday, 23 June 2021 at 5.50 pm, there was a late email communication received from the plaintiff's solicitors, reading in the following terms:
In light of the affidavit of Ms Jorissen, filed on 21 June 2021, and the further affidavit of Ms Jorissen, filed today, and in the interests of reducing the number of matters before the Court, the plaintiff does not intend to press the following parts of the Further Amended Chamber Summons of 21 June 2021 at the Special Appointment.
Under a series of dot points as enumerated by that email (and I will not identify them specifically) - there were more excisions from the document sought by the plaintiff. So again, the interlocutory discovery dispute evolves considerably in terms of its document dispute dimensions. At times it appears to shrink, but at other times it appears to grow.
Programming orders made in the past concerning discovery for this action (largely as a matter of consensus over time since I have case managed the action, commencing in 2016) have, by consent, essentially been for mutual general discovery. This is now an exceptional situation in the CMC List. But both parties, very well resourced and legally represented, wanted it. And in the context of what is a gargantuan building construction dispute, I was in the end persuaded that it was reasonable to proceed on that desired basis, rather than by the court ordering discovery by settled categories of documents.
Consequently, as is found explained in a number of Ms Jorissen's recent affidavits for the defendant read on this application (they are too numerous to mention) and indeed, in Ms Crepin's many affidavits read for the plaintiff (again, too numerous to mention), ongoing informal document discovery on a massive scale has been being provided electronically for some time now - as between these disputant parties. That process has been largely proceeding cooperatively, and by the mutual provision of a series of tranches of categories of documents that the parties' solicitors have been exchanging - and for over a year now.
That is not a process that I am critical about. But as it has evolved, it is in the nature of an informal discovery process, rather than by strict discovery. When I say strict discovery I mean discovery given in accordance with Rules of the Supreme Court 1971 (WA) O 26, which envisages that a verified list (or lists) of documents, with the verification implemented by affidavit(s) from somebody with knowledge towards the veracity, comprehensiveness and accuracy of the list and with any claims to privilege raised against the inspecting of listed documents properly raised, articulated and identified towards any as listed documents so identified as the subject of a privilege objection against their inspection and production.
A present difficulty, then, for circumstances where the parties themselves, for very understandable reasons, have departed somewhat from the formality of a verified list regime and have effectively engaged in ongoing informal documentary exchanges by tranches, but now find themselves in dispute. Now they wish to proceed formally
- by an enforcement of the local rules of court against each other by seeking further and better discovery orders against one another.
Present applications
The present applications effectively proceed on a basis of attempting to invoke the RSC, particularly O 26 r 9, O 26 r 6 and r 7, by each side contending now that the common law thresholds for identifying deficient discovery scenarios, are met.
In broad terms, what this means is that one party says the other side's provided discovery (to date) is deficient - because it can identify more documents which either exist, or of which it can be fairly certain that they exist, yet have not been produced or identified to date. Secondly, they say that a second necessary criteria for a further and better discovery order must be met, namely the manifest relevance of the missing document(s) to issues in the action (usually evaluated by reference to issues in dispute arising from the state of the parties' exchanged pleadings). Balanced against all that, for what at the end of the day is a discretionary order, are the pragmatic considerations of reasonable proportionality in relation to inhibiting unduly oppressive discovery burdens, especially in construction cases such as this where the task can be both enormous and confronting. So a court is both flexible, but fully empowered to modify the scope and scale of a discovery task when called for, still bearing in mind that discovery is a discretionary process - in terms of the parties' ambit obligations.
Plaintiff's further and better discovery application
The scope of disputed issues and the magnitude of the matters up for dispute and resolution on the plaintiff's present discovery application have, as now mentioned, waxed and waned. But very sensibly, as the matter finally came on for hearing this week, senior counsel for the plaintiff at the time identified or sought to identify (by reference to the plaintiff's further amended chamber summons) what was then described as a primary issue of discovery disputation persisting between the parties - in terms of the disputed claims for legal professional privilege as they have been implemented by the defendant by way of unilateral redactions made to some of their documents, as produced for inspection.
The plaintiff contends that many of the defendant's claims of legal professional privilege by redaction are or must be misconceived, or that a redaction as implemented, is misconceived. Frequently in that context, the plaintiff makes an allied argument as to the alleged waiver of privilege by the defendant, invoking to that end the usual common law authorities on the subject of imputed waiver and correlative loss of privilege by a party.
The present situation is also factually, quite unique in regard to the categories of documents that are made the subject of what I will call the plaintiff's 'redaction waiver privilege arguments' - that have become a chief focus of the oral arguments of senior counsel. This is understandable, given the parties still look to be a long way apart over it. This has led in turn to a concentration upon the plaintiff's further amended chamber summons by reference to its pars 1(c) and to the document as is there identified, and then to par 1(a), and particularly to the advice document identified, at par 3(a).
The underlying theme of the as identified in-principle disputation the court is ultimately asked to resolve, is largely over the unilateral redactions as made by the defendant on the basis of privilege, that is challenged by the plaintiff. Preceding exchanges of written submissions, which are lengthy, suggest in the lead up to the oral arguments over this issue, that the defendant by its legal representative has made - or has offered in the course of providing its responsive written submissions of 21 June 2021 (folio 213) - what is a significant concession. The subject of that concession can be found at pars 38, 39 and then 43, 44 and 45 of the defendant's responsive written submissions. They read in terms:
38Next, by Annexure 1 of the Deed of Standing Offer between the defendant and RLB, RLB was engaged to provide to the defendant (among other things) the following construction phase services:
(a) liaise with the defendant for resolution and clarification of Project cost elements;
(b)review and advise the defendant on the cost aspects of alternative design;
(c)evaluate contractor progress claims or other time and cost claims and make recommendations to the defendant, including by liaising with the defendant's other consultants; and
(d)advise the defendant on the cost and financial aspects of the Project.
39.Focusing for the moment on variation valuations, EOT claim assessments, contractual payment schedules / determinations as regards payment claims, and statutory adjudication responses, it follows that to the extent - if it be the case - that KMW or RLB communicated with APP, or assisted APP, specifically in relation to, or specifically in respect of, any of the following steps for the determination (or assessment) by APP of amounts (value) or days (adjustments to the Date for Completion):
(a)APP's clause 13.4(a)(ii)(A) independent 'reasonable valuation of (any) Variation' determinations; or
(b)APP's clause 13.4(a)(ii)(B) and cl 21.4(a)(iv) independent 'reasonable adjustment (determinations) to the Date for Practical Completion and the Date for Fitout Readiness'; or
(c)APP's Appendix 5, clause 2 thereof, independent function of determination of the 'amount payable in respect of the Contractor's cl. 1 claims for payment; or
(d)APP's clause 10.3(b)(ii) 'assessment of payment claims' under the Construction Contracts Act 2004 (WA) ('CCA'), - if identical to APP's contractual Appendix 5 determination of the 'amount payable',
then any document(s) being or recording such communication will be discovered.
...
43The disclosure of the substance of any such legal advice to APP and RLB, if it occurred, (that is, other than legal advice that might be specifically to inform and influence APP's independent valuation and (time) adjustment functions under clauses 13.4, 21.4 and Appendix 5) did not constitute a waiver of privilege because:
(a)other than its role as independent certifier in relation to the specific functions of assessing and determining variation and extension of time claims, valuing variation claims, or determining payment claims, APP was expressly the defendant's agent;
(b)APP and RLB owed contractual, and equitable, obligations of confidentiality to the defendant in relation to the information disclosed to them; and
(c)applying the principles set out in paragraphs 16 to 18 above, disclosure to an agent or to a consultant, in circumstances of confidentiality, was not inconsistent with the maintenance of legal professional privilege over the parts of the advice recorded in the documents.
44The plaintiff's submissions as regards this first category require careful reading. If read between paragraphs [39] to [48], the plaintiff's submissions could be understood as suggesting that because APP had independent certification functions (as opposed to its other agency functions for the defendant that the building Contract expressly identified) as regards variations and extensions of time, and because there had been some communications between APP and the defendant (which was to be expected given APP's dual functions), it somehow follows that all communications passing between APP and the plaintiff, or APP and King & Wood Mallesons, are discoverable.
45If that is the plaintiff's contention it should be rejected.
(a)The decision of Warren CJ in Kane v Sopov was not one concerned with a certifier who had dual functions qua the principal and the builder (some as an independent certifier and others as the principal's agent), and her Honour's observations at [632] need to be read with that in mind.
(i)At [622] her Honour noted there was a line of authority concerning interference with an independent certifier, and in what followed drew upon: John Holland Construction and Engineering Pty Ltd v Majorca Projects Pty Ltd [1996] 13 BCL 235; Hickman v Roberts [1913] AC 229; Multiplex Constructions v SOR Pty Ltd [2001] 17 BCL 174; Baulderstone Hornibrook Pty Ltd v Qantas Airways Ltd [2003] FCA 174.
(ii)The main passage from Kane v Sopov referred to by the plaintiff is the following:
[632]A set of indicia of interference of a superintendent may be extracted from the authorities. First of all, with respect to the role of the superintendent, interference leading to impartiality can arise in a series of circumstances. These include when the superintendent allows judgment to be influenced; when the superintendent is in a position whereby the certificate is deprived of value; when the superintendent is in a position whereby the certificate is deprived of value; when the superintendent acts in the interests of one of the parties and by their direction; when the position is misconceived and the superintendent acts as mediation; when there is not sufficient firmness in order to decide questions based on his or her own opinion; where [judgment] and conduct are controlled by the principal; and where the superintendent considers the assent of the principal to be necessary, has ceased to be a free agent and does not give full disclosure of every communication between the superintendent and the principal. Finally, the superintendent may lose independence without actually intending to do so or even without knowledge that they have done so.
(iii)Turning to the bolded proposition, it is to be observed that it is more limited in its reach than asserted in the plaintiff's submissions (at [40] and [41]). The plaintiff overlooks in its submissions the limiting effect of the prefatory words of 'where the superintendent considers the assent of the principal to be necessary'.
(iv)Assuming that premise for the moment, Warren CJ then attributes the 'all discovery' notion to the House of Lords reasons in Hickman v Roberts [1913] AC 229, 233, 238.
(v)But when one turns to Hickman it becomes clear that it was not a case concerned with determining if there was, or was not, an 'all disclosure' requirement for every communication by the owner (or on its behalf) with an independent certifier. Hickman needs to be understood in light of its facts. It concerned an architect with independent certification functions who had delayed and failed to discharge those functions while seeking instead to mediate resolution of a payment disagreement between the owner and builder. He did so after the appellant-owner company had made it clear to him in a private communication that it would not pay the builder whatever the architect's certification. At 233, Lord Loreburn LC observed that in that result the architect 'mistook his position'. At 238, Lord Atkinson observed that by so acting the architect had 'ceased to be a free agent', and that if it was to be suggested that he did in fact later act with the required independence there needed to be 'full and ample disclosure of every communication', rather than selected ones.
(vi)Hickman is not authority for the proposition that every communication to an independent certifier must be disclosed, let alone every communication where the builder has agreed in its building contract that the certifier will have multiple functions, some of which see the certifier as the owner's agent and others where there is involved an independent certification function.
(b)The plaintiff's reference at submissions [41] to Vestas v LAL need equally to be viewed with circumspection. The Court in that case was not concerned to, did not need to, and did not, pronounce without limitation that (a) where a certifier who has express (and agreed) multiple functions, and (b) where only some of those call for independence on the certifier's part (and others are to be undertaken as the owner's agent), that it must follow that disclosure of all communications between the owner and the certifier is to be made.
(i)The contractor sought both an injunction, and also preliminary discovery. There was a tension between those two courses, because seeking the injunction was at odds with the need for preliminary discovery.
(ii)At [79] Delaney J observed (after quoting the Hickman and Kane v Sopov passages above):
[79]These passages provide support for the proposition that any private communication is sufficient to undermine the independence of the Principal's Representative when acting in the Certification Role so as to amount to actionable breach. Consistent with its written submissions and earlier correspondence and Notices, this is the case that I understand the Contractor would wish to bring for final relief in support of which it sought an interlocutory injunction. It is also the same case that the Contractor would wish to consider bringing, in respect of which it seeks pre-action discovery.
(iii)But Delaney J did not go to the cases and recite the context in each case.
(iv)Nor did his Honour need to make, or make, findings as regards disclosure, or the reach thereof, for the reason that he separately found the plaintiff's injunction application meant that it had enough information to decide whether to bring a claim, with the result that preliminary discovery (which is driven by that question) would not be granted. (footnotes omitted)
In a summary way, what the defendant is seen to be articulating by the 'offer' seen at the end of par 39 above, is made by reference to the unique circumstances of the parties' present construction contract, where an owner's representative is nominated to perform a variety of multiple as specified functions or tasks. Some of those functions, as identified, are captured in the defendant's responsive submissions - by reference to the particular paragraphs of the T1 construction contract the parties entered. One may contrast the general agency functions identified for the owner's representative under par 34 of the defendant's written submissions, for that owner's representative acting then as the agent of the defendant. The relevant entity is known as APP.
However, the defendant's responsive written submissions also identify (at par 36) that under the same contract, the owner's representative (ie, APP) also was to discharge some further and distinct roles - namely, what is seen identified as regards APP conducting a valuation of variations by reference to cl 13.4(a)(ii) of the T1 construction contract, or determining of extension of time (EOT) claims under cl 21.4, subpars (a),(iv) and (v) and 21.4(c) of the T1 construction contract, or as well the task of rendering determinations on payment claims under Appendix 5 of the parties' T1 construction contract. These can be generally described as independent certifier or certification functions of APP under the T1 contract.
The contention of the defendant is that APP, save for those distinct certifier roles just mentioned above, remained otherwise, a general agent of the defendant in all its work in every other capacity as nominated under the T1 contract.
The defendant identifies many such general agency functions under par 37 of its responsive written submissions. There are, in fact, 28 as identified functions collected under subpars (a) to (bb) of par 37 and which for completeness I will also incorporate:
But at the same time the parties agreed that APP was otherwise an agent of the defendant in every other capacity under the Contract, including:
(a)directing additional Separable Portions under the Contract (see, clause 2.2);
(b)inspecting the Works and issuing Notices of Stage Completion to the plaintiff (clause 3);
(c)issuing directions in relation to the standard of the Works (clause 4.1);
(d)attending meetings of the Executive Committee (clause 4.4), convene and chair meetings of the Project Team (clause 6.5), attend meetings of the Design Review Team (clause 7.6);
(e)reviewing performance of Contractor Design (clause 5.4);
(f)acting as the primary reporting contact for the plaintiff under the Contract (clause 6.6);
(g)reviewing, and approving, the plaintiff's quality assurance systems for the Works (clause 6.8);
(h)reviewing, and approving, the Plans required to be submitted by the plaintiff under the Contract (clause 6.9);
(i)co-ordinating the activities of the plaintiff and any Separate Contractors under the Contract (clause 6.12);
(j)coordinating the relocation of tenants under the Contract (clause 6.27);
(k)reviewing and approving any proposed plaintiff changes to the Preliminary Design (clause 7.4);
(l)reviewing, approving or directing amendments to Design Documentation (clause 7.5);
(m)making directions in relation to Site Access (clause 8.1);
(n)dealing with any Latent Conditions or Underground or Concealed Services issues asserted by the plaintiff (clauses 8.3, 8.4);
(o)directing, as required, Site security measures (clause 8.7);
(p)reviewing, negotiating and determining (if necessary) the rates or prices in the Bill of Quantities (clause 9.3);
(q)directing Provisional Sum Work (clause 9.4);
(r)(as to claims under the Construction Contracts Act 2005 (WA)), acting as agent of the defendant for the purpose of accepting service of adjudication claims, assessing payment claims served by the Contractor, and providing payment schedules to the plaintiff (clause 10.3);
(s)directing, or approving, Variations (clause 13.1);
(t)approving any changes to the plaintiff's Key Personnel (clause 17.1) and approving any plaintiff Subcontracting (clause 18.1);
(u)attending any inspections notified by the plaintiff (clause 20.2);
(v)approving any Program, change in the program, change to timing, sequence, or staging of the Work or instruct any acceleration plan (clause 21.2);
(w)approving any reduction in time based on scope changes to the Works (clause 21.6);
(x)directing the suspension of the Works (clause 23);
(y)(on notice from the plaintiff), issuing a Certificate of Practical Completion or notifying the plaintiff of defects preventing such issue (clause 25);
(z)assessing and certifying Delay Liquidated Damages (clause 26);
(aa)approving the plaintiff's Start-Up Team (clause 27); and
(bb)terminating the Contract in the event of breaches of occupational safety and health obligations or a series of material breaches of the Contract (clause 33).
That background is really only an introduction to the present discovery, redaction and waiver of legal professional privilege problem. The as identified independent certification functions of an owner's representative or a 'Superintendent' under a construction contract, look to carry a line of case authority - also addressed by the defendant's submissions. I refer to the line of case authority seen in those cited submissions of the defendant discussed by the former Chief Justice Warren of the Victorian Supreme Court in Kane v Sopov [2005] VSC 237 (Kane v Sopov), particularly at [623] of her Honour's reasons. In essence, documents provided to, or emanating from a Superintendent acting in these independent certification capacities are not to be protected from relevant disclosure. Nor will any claim of legal professional privilege over advice, otherwise protected, be preserved if it reached the certifier whilst performing such role.
There is no disagreement, as I understand it, as between the present parties in terms of the applicable principles underlying legal professional privilege, its loss under circumstances of an actual or an imputed waiver, or for that matter over the occasions on which the redaction of documents to protect privileged parts of a document can legitimately take place.
Evaluations
The defendant's primary partner lawyer, Ms Juliana Jorissen, has been engaged on the dispute between these litigants since 2013. She has materially sworn for this application, by reference to each of the redacted documents of the defendant, that she has personally reviewed each of them again for this application - that is, their redacted components - the redactions being on the basis of privilege.
Ms Jorissen warrants, in effect, that she has personally evaluated the redacted documents as first, being advice the subject of legal advice that was provided to the defendant client and second, as not bearing on any of the types independent functions as have been identified for APP as in the role of an independent certifier/superintendent under par 36 of the defendant's responsive submissions.
The end position reached as I would assess it, by reference to what the court now holds from Ms Jorissen on behalf of the defendant as regards the redacted portions of produced documents, is akin to that of the evidentiary position arising more formally, had there otherwise been a properly verified list of documents asserting a claim of legal professional privilege for the defendant over each redacted component in such a document and so, effectively, reaching the orthodox position akin to the formal provision of a verified list of documents with articulated claims of privilege against inspection.
It was also not controversial before me that legal professional privilege is not lost under waiver, if the client beneficiary of the legal professional privilege shares the documented advice on a confidential basis with its own agents - for the purpose of advancing the common object of what is pursued essentially as between them. See generally in this area the observations upon waiver by Smith J in Insurance Commission of Western Australia v Antony Leslie John Woodings as liquidator of the Bell Group Ltd (in liq) [No 6] [2018] WASC 249 at [39] and following; and Antony Leslie John Woodings as liquidator of the Bell Group Finance Pty Ltd v WA Glendinning and Associates Pty Ltd [2019] WASC 54 at [28] - [29], [153] and following.
On the other hand, if a party enjoying the benefit of the legal professional privilege over such documents acts inconsistently with their continued confidentiality by their dealings with the advice - or, in effect, jettisons their confidentiality, say, by publishing the document generally to a third party or on an open basis - then the privilege is then likely to be lost by such inconsistent (with confidentiality) conduct.
The present as crystallised waiver issue
It is the imputed waiver doctrine that the plaintiff seeks to engage with here - to dispute the unilateral redactions made and attested to by Ms Jorissen. They are challenged as a matter of principle, as wrongly made. The plaintiff argues they ought not to be allowed to stand. Against that, the defendant says its redactions are proper and stand as properly verified by Ms Jorissen's review - whilst at the same time making the earlier concession it does - namely, that the defendant agrees to provide, or is amenable to providing, the categories of independent superintendent/certifier role documents - as identified by annexure 1, mentioned at subpar 2(a) of the defendant's responsive submissions.
That annexure 1 to the defendant's responsive submissions provided:
ANNEXURE 1 - PROPOSED REVISED ORDERS 2(A) AND 2(B) OF THE PLAINTIFF'S AMENDED CHAMBER SUMMONS - APP AND RLB DOCUMENTS
2,Pursuant to Order 26 rule 6, or Order 26 rule 7 of the Rules of the Supreme Court 1971 (WA), and in the Court's inherent jurisdiction, the defendant to give discovery of all documents that are, or have been, in the defendant's possession, custody or power within the following categories (in the period from April 2013 to March 2016);
(a)Subject to order 2(b) below, all correspondence and documents:
i.sent or received between the defendant's solicitors and APP Corporation Pty Ltd (APP);
ii.prepared by APP including notes, calculations and draft assessments;
iii.passing between APP and the defendant;
iv.passing between APP and Rider Levett Bucknall (RLB);
for the purpose of APP assessing and/or determining extension of time claims, valuing variation claims, or determining payment claims made by the plaintiff, which are the subject of these proceedings.
(b)The defendant is not required to discover or disclose any documents or correspondence prepared for the purpose of:
i.'without prejudice' mediations and negotiations between the plaintiff and the defendant;
ii.adjudications between the plaintiff and the defendant;
iii.anticipated and actual litigation; or
iv.enabling the provision of legal advice to the defendant in connection with the matters referred to at items (b)(i) to (iii) above.
So seen, the defendant maintains its claims of legal professional privilege (by redaction) over aspects of the documents, insofar as they were provided to, or have reached APP, or reached another of the defendant's agents, under circumstances other than those applicable to APP's independent certifier role documents.
Resolving what is here a disputed engagement, or a contended loss of legal professional privilege under imputed waiver conduct for TI Contract scenario of the dual functions of APP, is no routine discovery dispute. But what the controversy has effectively distilled to is the debate over the wording for what is seen proposed under Annexure 1 in the defendant's responsive submissions, or whether as the plaintiff argues, what the defendant offers is inadequate, or does not go far enough.
This distilled controversy has led to a rival minute of proposed orders suggested by the plaintiff - where different wording is deployed (see folio 264). I incorporate the plaintiff's rival wording by reference below:
APP documents
1.Pursuant to Order 26 rule 6, or Order 26 rule 7 of the Rules of the Supreme Court 1971 (WA), and in the Court's inherent jurisdiction, the defendant is to give discovery of all correspondence and documents in the period from April 2013 to September 2018 passing between APP Corporation Pty Ltd (APP) and the defendant, passing between APP and the defendant's solicitors, passing between APP and Rider Levett Bucknall (RLB), or prepared by APP including notes, calculations, delay analyses and draft assessments, that are, or have been, in the defendant's possession, custody or power (the relevant documents) that:
(a)refer to or relate to claims made by BEPL that are the subject of these proceedings (subject to any claim of legal professional privilege - see (c) below); or
(b)directly or indirectly, either (1) did affect, or (2) objectively construed may have affected, the independent certification function of APP under the Contract (certification function), specifically:
(i)the determination of the reasonable valuation of Variations (per clause 13.4);
(ii)the determination of reasonable adjustments to the Date for Practical Completion and the Date for Fitout Readiness (per cl 13.4);
(iii)the determination of entitlement to extensions of time (per clause 21.4);
(iv)the determination of payment claims (per Appendix 5),
(c)there is no valid claim for professional privilege in respect of the relevant documents in (a) if the relevant documents meet the requirements of (b).
...
Most materially, I refer to subpar 1(b) as seen above - which would alternatively suggest that there be a disclosure of documents, directly or indirectly, which either did affect, or objectively construed, may have affected, the independent certification function of APP under the parties' contract.
So distilled an intensely stimulating debate raged over the rival formulations seen under Appendix 1 to the defendant's responsive submissions, as opposed to the plaintiff's most recently provided minute. Before I return to resolve that dispute, I must divert to discuss a little more the law concerning an imputed waiver.
The law: imputed waiver
The common law test in regard to waiver of legal professional privilege is comprehensively addressed under the decision of Allsop J (as he then was) in DSE (Holdings) Pty Ltd v Intertan Inc [2003] FCA 384; 127 FCR 499 at pages 504 - 505, commencing at [11] and following.
After discussing the leading High Court authorities of Mann v Carnell (1999) 201 CLR 1, Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49 and also Northern Territory v GPAO (1999) 196 CLR 553 at [12], Allsop J said:
Waiver at common law occurs where the party entitled to the privilege performs an act which is inconsistent with the maintenance of the confidentiality, assessment of such inconsistency being informed where necessary by considerations of fairness; though the assessment is not by reference to some overriding principle of fairness operating at large: Mann v Carnell at 13 [29].
His Honour continued at [13], after referring to Cross on Evidence (2000):
The circumstance of waiver with which these applications are concerned is that which can be brought about by the contents of pleadings. The expression often used, as in argument on the motions, was 'putting in issue' the confidential (and privileged) communication. It is but an illustration of the circumstances in which implied waiver may occur.
Concluding those waiver observations, his Honour added at [14]:
The overriding guiding principle is that stated in Mann v Carnell at [29]. The expression of that principle and the subordination of the notion of 'fairness' to possible relevance in the assessment of the inconsistency between the act and the confidentiality of the communication produces, it seems to me, an important change to the existing law. In order to explain why I think this is to be so, it's necessary for me to examine the pre-existing authorities. This will also illuminate the operation of the principle as expressed in Mann v Carnell at 13 [29] and the importance of the recognition that is the inconsistency between the relevant act of the holder of the privilege and the maintenance of the confidence that is essential, not a broad balancing process based on fairness. (my emphasis in bold)
Allsop J then proceeded to conduct an exhaustive analysis of Australian and international authority on the subject of privilege waiver, culminating in conclusions which I will not cite, but noticed at [112] and [113] of those reasons.
As I evaluate the present situation, the test for waiver is grounded on the issue of inconsistency, whilst informed by considerations of fairness, in terms here, of the position of APP towards the redactions made by the defendant's lawyers on a basis of privilege, in terms of legal advice provided to the client, kept confidential albeit being then shared with the defendant's agents including with APP in an implementation of works under the T1 contract by the defendant.
Evaluation
The essence of the residual controversy, bearing in mind what I have now discussed, is not over the legal principles I have articulated concerning an imputed waiver. There was no debate over that. Rather it is the proper application of those settled principles to the unique circumstances of APP's multiple functions performed under the parties' T1 contract which is in dispute.
On the one hand is APP's broad-based general agency role under the T1 contract - under which it would be perfectly legitimate for the defendant to relevantly share its lawyer's advice, provided the advice is kept confidential. But the differing scenario for the independent certification tasks of APP as the owner's representative under the T1 contract where, in light of the Kane v Sopov line of authority applicable to such certifiers, the defendant accepts by its concession, properly, that there are categories of documents, if provided to APP by the defendant or by the defendant's solicitors in performing those independent certifier functions, that they must be disclosed (or relevantly, cannot be redacted).
The clash of perspectives has, unusually, and perhaps undesirably, descended to a rival drafting exercise that has emerged between the rival versions as proposed by the defendant and later a counter‑version under the minute as submitted by the plaintiff during the course of the hearing (folio 264).
Plaintiff's minute of proposed orders
Evaluating the plaintiff's rival proposal as under its minute of proposed orders, I hold abiding concerns about two factors therein. First of all, the underlying factual basis pursuant to which the waiver by alleged inconsistency of conduct argument is there to be found articulated concerning portions of documents in the possession of APP (including from King & Wood Mallesons), is on a basis that is purely hypothetical. This seems to me very much on the basis of, 'Well, there may have been this,' or 'There may have been that' happen. By my assessment, particularly by reference to the rival state of Ms Jorissen's affidavits read for the defendant articulating what she has done in terms of her review of the redactions, what the plaintiff has speculated about is insufficient.
I accept the submission of Mr Miller SC made yesterday, that a hypothetical approach to ' ... there may be documents', or 'What if this was the case - in terms of something submitted for one purpose, but used for another' - effectively reverses what is the evidentiary onus carried by the plaintiff to identify some real act of inconsistency to engage with the imputed waiver principle being relied upon.
In the end, I am unmoved by the hypothetical character of how the argument is advanced underlying the plaintiff's rival minute position.
Second, I do not assess that the attempted articulation as seen under the plaintiff's minute of proposed orders - particularly by reference to someone objectively construing documents, in terms of the certification function, is at all practicable. Such an approach seems to me to be redolent with application difficulties likely to emerge.
So it is both the hypothetical and impractical characteristics that in the end turn me away from the plaintiff's proposed minute.
Defendant's minute of proposed orders
That leaves me with annexure 1 to the defendant's responsive submissions dated 21 June 2021 (folio 213), which otherwise did largely present to me to be a workable solution - subject to one concern over the words seen in the proviso to subpar 2(a), namely, 'for the purpose of APP assessing'.
These few words did seem to me to be potentially problematic - on a basis of identifying the four categories as identified by subpars (i) to (iv) of Appendix 1 - to effectively decide whether they are covered or not, by way of a production - evaluated by reference to some level of a purposive test in terms of whoever authored the document, bearing in mind what is identified.
I assess that terminology as being out of a principled alignment essentially with the certifier privilege concession for documents as is offered by the defendant - namely that anything the certifier held in performing that independent function was relevant and should be produced, including when or if there was some legal advice embedded in such a document.
For APP, in performing the general agency functions allocated to it under the T1 contract, where the owner's legal advice is shared with APP as owner's representative for a legitimate purpose that situation will not of itself generate any waiver - because the sharing conduct would be a production to an agent of the defendant within the umbrella of the documentary confidentiality generally within a group of defendants with a common interest, extending to the agents of the defendant.
Later developments
There were two more key developments during the course of the hearing. First was an amended proposed version of Appendix 1 provided by the defendant's legal team overnight. This displays as replaced, the words 'for the purpose of APP assessing' by words 'for, in respect of, or concerning' and running on - as the defendant's Appendix 1 otherwise had done (see folio 265). I set out that proposed as amended par 2 below:
ANNEXURE 1 - PROPOSED REVISED ORDERS 2(A) and 2(B) OF PLAINTIFF'S AMENDED CHAMBER SUMMONS - APP AND RLB DOCUMENTS
2.Pursuant to Order 26 rule 6, or Order 26 rule 7 of the Rules of the Supreme Court 1971 (WA), and in the Court's inherent jurisdiction, the defendant to give discovery of all documents that are, or have been, in the defendant's possession, custody or power within the following categories (in the period from April 2013 to March 2016):
(a)Subject to order 2(b) below, all correspondence and documents:
i.sent or received between the defendant's solicitors and APP Corporation Pty Ltd (APP);
ii.prepared by APP including notes, calculations and draft assessments;
iii.passing between APP and the defendant;
iv.passing between APP and Rider Levett Bucknall (RLB);
for, in respect of, or concerning APP's assessments and (or) determinations of extension of time claims, the value of variation claims, or the value of payment claims, which are the subject of these proceedings.
(b)The defendant is not required to discover or disclose any documents or correspondence prepared for the purpose of:
i.'without prejudice' mediations and negotiations between the plaintiff and the defendant;
ii.adjudications between the plaintiff and the defendant; and
iii.anticipated and actual litigation; or
iv.enabling the provision of legal advice to the defendant in connection with the matters referred to at items (b)(i) to (iii) above.
That, I think, meets my expressed concerns over the purposive problematic terminology of its predecessor. Personally, I had postulated overnight over substituting 'for the purpose of' with the words 'relevantly concerning'. But what the defendants have produced overnight meets my in principle concerns and, subject to what I say next, can be accepted.
But an even later issue emerged from the plaintiff's quarter, in terms of whether what is currently seen as subpar 2(b) of the defendant's minute (which as seen has not changed at all) effectively takes away in its application what would be otherwise seen as given under (revised) subpar 2(a).
This new submission was not something the defendant received a fair opportunity to consider given its late articulation. Nor did the court receive a fair opportunity to deliberate over the new point. It only emerged under the last reply submissions of senior counsel for the plaintiff.
Broadly, I accept the position as it came to be articulated by the defendant, on a basis of its accompanying concession, which was a proper concession, as reflected in Annexure 1 and in paragraphs of its written submissions concerning the certifier documents of APP that I have identified (see [16]). Had the defendant not made that concession, the position would have been more problematic.
The residual question is over a pragmatic and viable implementation under the wording of the defendant's APP concession as revised. Regrettably, more time is required to resolve the late point made by senior counsel for the plaintiff that emerged, if it remains controversial. The parties may be able to resolve that issue between themselves. I will allow a little more time for that to possibly unfold.
Otherwise, I will rule on that last outstanding issue, if necessary.
Generally, however, I am not attracted by the rival terminology of the plaintiff in its proposed minutes for the reasons now given.
That is my ruling on the plaintiff's discovery application, subject to resolving the late point that was raised by senior counsel for the plaintiff.
Defendant's PAPL application
Relevance of documents
The first issue the court is asked to resolve upon the defendant's discovery application concerns the relevance of and therefore discovery (if required) by the plaintiff of labour attendance records for the ancillary CLF project.
As is well understood, the general law test of documentary relevance for discovery is pitched at a relatively low threshold. It is certainly not the same as the higher admissibility threshold in terms of admitting a relevant document into evidence at a trial.
At the end, I am satisfied on the basis of Ms Jorissen's affidavit (folio 231), that a respectable argument is made, applying the 'line of inquiry' test, that these as requested labour attendance records for the CLF project from the plaintiff could possibly be relevant to the furtherance of live issues at trial concerning delay costs as are claimed by the plaintiff, and as to how the defendant's experts may evaluate all such interrelated attendance records - in terms of measuring the delay claim and its merits. Experts interested in those sort of issues may spend a great deal of time preparing a report by way of analysis over that issue and such documents may bear on their work. So they should be produced.
Documents sought under application
I turn now to the categories of documents as sought by the defendant by way of further and better discovery (see the schedule to the defendant's chamber summons dated 3 June 2021). By the time of the hearing before me, the plaintiff by its lawyers consented, in effect, to produce the majority of the requested documents. Only the identified documents 20 and 23 remained in dispute.
As has been said and as has helpfully emerged out of the parties' written submissions, the only real issue in relation to document 20 is whether this court, in an exercise of its discretion, applying sensible case management principles and as a matter of proportionality, is persuaded that these otherwise relevant documents which exist, ought to be located, or left not to be produced. There is a concession by the plaintiff also in terms of producing all electronic documents in this field that are held to be made available. The difficulty lies with a necessary retrieval exercise for physical documents that are said to perhaps be littered across various places in Perth and Adelaide or filed in a way that is going to take some time for them to be found and physically retrieved and assembled.
The suggestion of the plaintiff is that some alternative production approach be followed - by way of using some sort of sampling process, or by way of expert conferral to target and interrogate documents in a narrower way. However, the discovery exercise overall has been going on for over a year. It is already an exercise of gargantuan proportions both physically and financially on both sides. This is not the usual case by any means. Teams of lawyers on both sides seem to work intensively on the discovery exercise, on an ongoing basis. Tranche 22 of exchanged materials is seen being provided on the rolling basis as agreed by the defendant - as I read in Ms Jorissen's affidavit.
Assessed in the overall scheme of things, $93,520 as the plaintiff's estimated internal cost in terms of the estimated cost of a retrieval of the documents - seems to me, in the context here, not to be all that significant. In my dialogue with senior counsel, I used the expression 'drop in a bucket'. Measured against the cost of assembling and exchanging already the megabytes of documentary materials appended electronically to solicitors' affidavits - in particular to the 27 volumes of electronic materials just uploaded to the court's electronic filing platform by Ms Crepin as appendages to her affidavit sworn 21 June -this is far from the more typical case measured by normative scales of expenditure on the discovery process.
The whole discovery exercise is clearly gargantuan. I do see some utility in having these documents made available to the defendant. There is no argument about their relevance. Some work is going to be required internally by the plaintiff to find and assemble the documents. So be it. If it was a case of possibly saving $900,000 or something in that arena, that would be more proportionate in the overall scheme of things.
But as regards physical documents that are necessary, someone in the plaintiff's employment or team of lawyers is just going to have to find and review them. They must be produced.
Costs
Plaintiff's application
On the plaintiff's side, in terms of the costs of seeking the documents on its application, the plaintiff's submission, through Ms Hindman QC, is that it should have its costs paid on a basis that it has been substantially successful.
On the other hand, the defendant, through Mr Miller SC, says the defendant ought to have its costs thrown away, as a significant truncation in the scale of the application of the plaintiff, is self-evident.
It is certainly true that since January 2021, when the plaintiff first filed its chamber summons, there has been a very considerable waxing and waning in terms of adjustments to its chamber summons by amendment, deletions, augmentations and the like.
As a matter of overall policy, the court strives to generate a conducive environment for litigating parties to sensibly crystalise and resolve their civil disputes both interlocutory and final. The environment as promoted should facilitate for proper and sensible concessions to happen even just before or during a hearing, without the conceding party being unduly mulched for costs for doing so. Sensible concessions are indispensable to the proper functioning of the civil justice system. They need to be encouraged, not discouraged, even after an application is pending. That is what I assess as happening here. And, in the end, I am assisted.
Overall, I cannot reach a point of characterising the plaintiff as having had an overwhelming victory on its present application. I assess it has had some measure of success, in terms of the key concession made by the defendant, by reference to independent certification documents of APP which are, effectively, to be produced for inspection. A precise implementation of that regime distils down to language that is yet to be finally settled upon. But the outcome as I see it carries some elements of success for the plaintiff. Likewise, on the defendant agreeing to conduct searches for documents by wider search terms, the plaintiff has had some success there with the defendant.
I balance that, however, overall against a very considerable volume of other documentary materials that the plaintiff was originally demanding, for instance, for excisions of categories of documents removed under the late email communication by Ms Crepin of 23 June 2021. So it seems to me overall that there have been wins and losses on both sides in the end outcome on the application of the plaintiff.
My position would be, particularly bearing in mind there is still a late issue still to be resolved, that costs in regard to the plaintiff's discovery application should be costs in the cause of the ultimate proceedings.
Defendant's application
In terms of the defendant's application, I can assess that here, the defendant has been substantially successful. Consequently, it should have its costs of its application evaluated, both by reference to the outcome of the two essential disputed issues I needed to evaluate, and by reference to the other matters in the schedule to the defendant's chamber summons dated 3 June 2021 (folio 208), which effectively or largely came to be resolved by way of the concessions from the plaintiff. So in that respect, the defendant should have its costs.
The taxing processes of this court, if costs are not agreed, are sophisticated enough to separate out the components of the day and a half that was consumed upon the two applications heard together - in order for a proper and just apportionment of costs to be achieved. So implicitly then, I am not accepting the submission that the costs of the discovery applications be dealt with together. They need to be evaluated discretely.
Orders will issue accordingly, subject to any required resolution by me in respect of the late submission of the plaintiff that I have afforded the parties more time to consider and confer over.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
RC
Associate to the Honourable Justice Martin
16 JULY 2021
8
0