Caddle Management Services Pty Ltd v Commissioner of Taxation of the Commonwealth of Australia Summary

IN THE FEDERAL COURT OF AUSTRALIA )
)

VICTORIA DISTRICT REGISTRY ) No SG 60 of 1991
)

GENERAL DIVISION )

BETWEEN: CADDLE MANAGEMENT SERVICES PTY LTD

(Applicant)

AND: COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA

(Respondent)

CORAM:    Ryan J
DATE:     27 March 1997
PLACE:    Melbourne

RULING ON CLAIM FOR PRIVILEGE
AGAINST PRODUCTION OF DOCUMENTS

When this matter was last before the Court I upheld a claim of legal professional privilege in respect of the documents produced by Mr Erlichster, the solicitor for Tower Life Australia Limited ("Tower Life"). That left for consideration some 51 documents listed in the affidavit sworn 14 December 1995 of Warwick Douglas Mowbray, the solicitor for the applicant. Those documents and the basis on which they were said to attract legal professional privilege were somewhat elliptically described in Mr Mowbray's affidavit and I undertook to examine each of the documents for myself. I have since completed that examination and uphold the claim of privilege of all of the documents identified by Mr Mowbray and numbered between 2 and 56.

Most of the documents consist of bills of costs and correspondence about them, principally between Mowbray Erdynast and Tower Life. Of their nature, bills of costs can disclose or indicate matters on which advice has been sought or given in preparation for litigation. As well, some of the correspondence on matters of costs concern issues entirely unrelated to the present litigation which would not be discoverable on any view.

The rest of the documents in Mr Mowbray's list were essentially items of correspondence dealing with progress reports or requests for instructions concerning the present litigation, particularly interlocutory aspects of it.

From this description of the documents, it can be seen that all of them fall within one or other of category (a) or category (e) of the six categories of privileged documents identified by Lockhart J in Trade Practices Commission v Sterling (1979) 36 FLR 244. As well, it was unequivocally held by Sir Charles Hall VC in Turton v Barber (1874) LR 17 Eq. 329 that a solicitor's bill of costs can attract legal professional privilege which is not waived by its inclusion in a solicitor's affidavit as to documents.

Moreover, I do not perceive that the detail of the bills of costs enumerated by Mr Mowbray, apart from the fact that they have been rendered, can cast any light on the issues to be litigated between the applicant and the Commissioner. Similar considerations apply to correspondence between the applicant's solicitors and Tower Life or the applicants about an agreement by Tower Life to make a contribution to the applicant's costs. Accordingly, as far as any exercise of discretion is involved in resolving whether the documents should be produced for inspection, I have concluded that the balance is strongly in favour of the applicant.

The application will be listed for directions on a date and at a time mutually convenient to the parties. The costs of both parties of and incidental to the motion on notice dated 30 August 1995 including the costs of the hearings on 3 November 1995 and 14 December 1995 be costs in the cause.

I certify that this and the preceding two (2) pages are a true copy of the ruling of his Honour Justice Ryan.

Associate:

Date:

CaseChat Overview and Summary

Caddle Management Services Pty Ltd sought to prevent the Commissioner of Taxation from inspecting certain documents it claimed were protected by legal professional privilege. The Federal Court of Australia had to determine whether these documents should be disclosed for inspection. The primary issue before the court was whether the 51 documents listed in an affidavit by the applicant's solicitor, Mr Mowbray, were protected by legal professional privilege and thus should not be disclosed to the Commissioner. The court had to consider the nature of these documents, their relevance to the litigation, and whether they fell within the categories of privileged documents identified in previous case law.

The court examined each of the 51 documents to assess whether they fell within the privileged categories identified by Lockhart J in Trade Practices Commission v Sterling and upheld by Sir Charles Hall VC in Turton v Barber. The majority of the documents were bills of costs and related correspondence between Mowbray Erdynast and Tower Life. The court found that these documents, being bills of costs and communications concerning them, fell within category (a) or category (e) of the privileged categories. Additionally, the court recognised that a solicitor's bill of costs could attract legal professional privilege and that this privilege was not waived by including the bill in a solicitor's affidavit. The remaining documents primarily involved correspondence concerning the litigation's progress and requests for instructions, which also qualified as privileged documents.

Given the nature of the documents and their relevance to the litigation, the court concluded that the balance of discretion favoured upholding the privilege claim. The detailed content of the bills of costs and related correspondence did not shed light on the issues between the applicant and the Commissioner. The court determined that the privilege claim was valid, and the documents should not be disclosed for inspection. The court ordered that the application would be listed for directions at a mutually convenient time for the parties and that the costs of the proceedings would be borne by both parties.

Caddle Management Services Pty Ltd v Commissioner of Taxation of the Commonwealth of Australia

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established