Carey v Korda

Case [2012] WASCA 228

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT  :   THE COURT OF APPEAL (WA)

CITATION:   CAREY -v- KORDA [2012] WASCA 228

CORAM:   MARTIN CJ

NEWNES JA
MURPHY JA

HEARD:   8 AUGUST 2012

DELIVERED          :   15 NOVEMBER 2012

FILE NO/S:   CACV 132 of 2011

BETWEEN:   NORMAN PHILLIP CAREY

First Appellant

QUARTZ NOMINEES PTY LTD
Second Appellant

AND

MARK ANTHONY KORDA As Receiver and Manager of Huntingdale Village Pty Ltd (Receivers and Managers Appointed), Silkchime Pty Ltd (Receivers and Managers Appointed), Vannin Pty Ltd (Receivers and Managers Appointed), Warwick Entertainment Centre Pty Ltd (Receivers and Managers Appointed), Paragon Apartments Ltd (Receivers and Managers Appointed), Westpoint Corporation Pty Ltd (Receivers and Managers Appointed (In liq), Bayview Port Melbourne Ltd (Receivers and Managers Appointed) (In liq) and Westpoint Management Ltd (Receivers and Managers Appointed) (In liq)
First named First Respondent

DAVID JOHN WINTERBOTTOM As Receiver and Manager of Huntingdale Village Pty Ltd (Receivers and Managers Appointed), Silkchime Pty Ltd (Receivers and Managers Appointed), Vannin Pty Ltd (Receivers and Managers Appointed), Warwick Entertainment Centre Pty Ltd (Receivers and Managers Appointed), Paragon Apartments Ltd (Receivers and Managers Appointed), Westpoint Corporation Pty Ltd (Receivers and Managers Appointed) (In liq), Bayview Port Melbourne Ltd (Receivers and Managers Appointed) (In liq) and Westpoint Management Ltd (Receivers and Managers Appointed) (In liq)
Second named First Respondent

PERPETUAL NOMINEES LTD
Second Respondent

ON APPEAL FROM:

Jurisdiction              :  SUPREME COURT OF WESTERN AUSTRALIA

Coram  :EDELMAN J

Citation  :CAREY -v- KORDA & WINTERBOTTOM [No 2] [2011] WASC 220

File No  :COR 147 of 2010

Catchwords:

Evidence - Privilege - Legal professional privilege - Receivers and managers - Whether solicitors engaged by receiver and manager are engaged to act for company - Whether sufficient basis to maintain claim for legal professional privilege over bills of costs and recharge schedules - Whether legal professional privilege waived - Whether privilege abrogated by statute

Legislation:

Corporations Act 2001 (Cth), s 290, s 419, s 420A, s 421, s 423
Legal Profession Act 2008 (WA), s 467, s 468, s 469
Legal Practice Act 2003 (WA), s 201, s 228, s 232, s 234

Result:

Appeal allowed in part

Category:    A

Representation:

Counsel:

First Appellant          :    Mr A Metaxas

Second Appellant          :    Mr A Metaxas

First named First Respondent     :    Mr J Stoljar SC & Mr M J Feutrill

Second named First Respondent :    Mr J Stoljar SC & Mr M J Feutrill

Second Respondent          :    Mr J Stoljar SC & Mr M J Feutrill

Solicitors:

First Appellant          :    Metaxas & Hager

Second Appellant          :    Metaxas & Hager

First named First Respondent     :    King & Wood Mallesons

Second named First Respondent :    King & Wood Mallesons

Second Respondent          :    King & Wood Mallesons

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

AGL Victoria Pty Ltd v Lockwood [2003] VSC 453; (2003) 10 VR 596

Ainsworth v Wilding (1900) 2 Ch 315

Allmark v Mossensons (a firm) [2006] WASCA 127

Apple v Wily [2002] NSWSC 855

Australian Mutual Provident Society v Geo Myers & Co Ltd…

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Carey v Korda [2012] WASCA 228
Case
[2012] WASCA 228
Decision Date

CaseChat Overview and Summary

In the case of Carey v Korda, the Full Court of the Federal Court of Australia was tasked with determining the extent of legal professional privilege over documents related to a receivership and management arrangement. The primary issue was whether the privilege extended to the solicitors engaged by the receivers and managers, and if so, whether this privilege could be maintained in the face of a claim by the liquidators of the company for access to the solicitors' bills of costs and recharge schedules. Additionally, the court had to consider whether the privilege had been waived or abrogated by statute.

The court delved into the principles of legal professional privilege, particularly focusing on the distinction between the privilege of the client and that of the lawyer. The court noted that the privilege may be invoked by the client to resist the disclosure of documents that reveal privileged communications made for the purpose of obtaining legal advice or services. It also considered whether the solicitors were engaged to act for the company or solely for the receivers and managers. The court found that if the solicitors were acting for the company, the privilege could potentially extend to the documents in question. However, if the solicitors were acting solely for the receivers and managers, the privilege might not apply to the documents relevant to the company's affairs.

The court concluded that the privilege was not waived or abrogated by statute. It determined that the solicitors were engaged to act for the company, thus extending the privilege to the documents in question. The court further held that the nature of the privileged communication could be inferred from the bills of costs, making them subject to the privilege. The Full Court found that the privilege had not been waived, and the liquidators' claim for access to the documents was accordingly dismissed.

In summary, the court upheld the legal professional privilege over the solicitors' bills of costs and recharge schedules, finding that the privilege was applicable and had not been waived or abrogated by statute.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

The privilege 'may be availed of by a person to resist the giving of information or the production of documents which would reveal communications between a client and his or her lawyer made for the dominant purpose of giving or obtaining legal advice or the provision of legal services': The Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission [2002] HCA 49; (2002) 213 CLR 543 [9]. The privilege is available where the document expressly reveals the privileged communication, or where the content or nature of the privileged communication may be inferred from the document: Commissioner of Australian Federal Police v Propend Finance Pty Ltd [1997] HCA 3; (1997) 188 CLR 501, 569; AWB Ltd v Cole [2006] FCA 571; (2006) 152 FCR 382 [132] ‑ [133]. A solicitor's bill of costs may fall into that category of document: Commissioner of Australian Federal Police v Propend Finance Pty Ltd (569) per Gummow J; Ainsworth v Wilding (1900) 2 Ch 315, 325; Packer v Deputy Commissioner of Taxation [1985] 1 Qd R 275, 282; Lake Cumbeline Pty Ltd v Effem Food Pty Ltd (t/as Uncle Ben's of Australia) (1994) 126 ALR 58, 68; Hodgson v Amcor Ltd (No 2) [2011] VSC 204 [59] ‑ [65]; R v Manchester Crown Court, Ex parte Rogers [1999] 1 WLR 832, 839; Cook v Pasminco Ltd (No 2) [2000] FCA 1819; (2000) 107 FCR 44 [46]. This line of cases emanates from Chant v Brown (1852) 9 Hare 790; 68 ER 735. In that case, Mr Melton had a power of appointment in favour of any one or more of his children with regard to an estate which, in default of appointment, would go to all of the children. Mr Melton appointed the estate to one of his children, who concurred in mortgaging the property to a third party. A solicitor (Mr Brown) had acted for Mr Melton on the appointment, and for Mr Melton and the mortgagee on the mortgage, and had received the proceeds of the mortgage on behalf of Mr Melton. The proceeds of the mortgage were applied for Mr Melton's benefit. Mrs Chant, one of Mr Melton's other children, brought an action to set aside both the appointment that had been made, and the mortgage that had been entered into, on the grounds that the appointment was a fraud upon the power and the mortgagee had notice of the fraud. Mrs Chant also sued the solicitor. The plaintiff sought to interrogate the solicitor's clerk about a document, a bill of costs, which the clerk had copied from a draft bill of costs which itself had been prepared from the attendance books of the solicitor. The plaintiff sought to tender the evidence to impeach the title of the mortgagee, which rested upon, ultimately, the validity of the appointment. The bill of costs made reference, amongst other things, to both the appointment and the mortgage. The Vice‑Chancellor, Sir G J Turner, found that the solicitor's bill of costs was privileged. His Lordship reasoned that the appointment and the mortgage were, in effect, one transaction and that the solicitor (who had acted for Mr Melton and the mortgagee) could not have been compelled to give evidence which could be used against the mortgagee. His Lordship stated that '[a]n attorney's bill of costs is, in truth, his history of the transactions in which he has been concerned; and if he cannot be called to prove the facts I think his clerk cannot be called to prove the history of them' (9 Hare 790, 794; 68 ER 735, 737). It appears that his Lordship was referring to the solicitor's history, revealed in the bill of costs, of the instructions received and the advice given.