G&S Engineering Services Pty Ltd v MACH Energy Australia Pty Ltd (No 8)

[2022] NSWSC 1170

Supreme Court

New South Wales

• Amendment notes

Medium Neutral Citation:

G&S Engineering Services Pty Ltd v MACH Energy Australia Pty Ltd (No 8) [2022] NSWSC 1170

Hearing dates:

18 and 29 August 2022

Date of orders:

31 August 2022

Decision date:

31 August 2022

Jurisdiction:

Equity - Technology and Construction List

Before:

Stevenson J

Decision:

Certain privilege claims upheld

Catchwords:

PRIVILEGE – documents produced on subpoena – whether the documents are subject to client legal privilege

Cases Cited:

Asahi Holdings (Australia) Pty Ltd v Pacific Equity Partners Pty Limited (No 4) [2014] FCA 796

Commissioner of Taxation v PricewaterhouseCoopers [2022] FCA 278

Desane Properties Pty Limited v State of New South Wales [2018] NSWSC 173

G&S Engineering Services Pty Ltd v MACH Energy Australia Pty Ltd (No 6) [2022] NSWSC 628

Kenquist Nominees Pty Ltd v Campbell (No 5) [2018] FCA 853

Category:

Procedural rulings

Parties:

G&S Engineering Services Pty Ltd (First Plaintiff/First Cross-Defendant/First Applicant)
DRA Pacific Pty Ltd (Second Plaintiff/Second Cross-Defendant/Second Applicant)
DRA Group Holdings (Pty) Ltd (Third Cross-Defendant/Third Applicant)
DRA Global Limited (Fourth Cross-Defendant/Fourth Applicant)
MACH Energy Australia Pty Ltd (First Defendant/First Cross-Claimant/First Respondent)
MACH Mount Pleasant Operations Pty Ltd (Second Defendant/Second Cross-Claimant/Second Respondent)
J.C.D. Australia Pty Ltd (Third Defendant/Third Cross-Claimant/Third Respondent)
Calibre Group Pty Ltd (Subpoena Recipient/Fourth Respondent)

Representation:

Counsel:
M G Lyons with A Emmerson (Plaintiffs/Cross-Defendants/Applicants)
N Simpson with E Ball (Defendants/Cross-Claimants/First to Third Respondents)
J K S Entwisle (Subpoena Recipient/Fourth Respondent)

Solicitors:
Jones Day (Plaintiffs/Cross-Defendants/Applicants)
Corrs Chambers Westgarth (Defendants/Cross-Claimants/ First to Third Respondents)
HWL Ebsworth Lawyers (Subpoena Recipient/Fourth Respondent)

File Number(s):

2019/71358

JUDGMENT

1. The background to these proceedings is set forth in earlier judgments of the Court, including my judgment of 17 May 2022. [1]

   1. G&S Engineering Services Pty Ltd v MACH Energy Australia Pty Ltd (No 6) [2022] NSWSC 628.

2. As I recorded in that judgment, the defendants/cross-claimants (“MACH”) issued a subpoena to the Calibre Group Pty Ltd, the former parent company of the first plaintiff (“G&S”).

3. Issues of client legal privilege have arisen in relation to the documents produced on subpoena by Calibre.

4. Calibre itself has claimed client legal privilege in relation to certain documents.

5. G&S has claimed privilege in relation to certain other documents.

6. On 31 August 2022, through my Associate, I notified the parties of my conclusions concerning the privilege claims.

7. These are my reasons for reaching those conclusions.

The privilege claimed by Calibre

8. All of the documents in respect of which Calibre claims privilege are email chains.

9. Client legal privilege attaches to “communications” and an email chain, containing multiple emails, constitutes one communication made to the ultimate recipient of the email chain.

10. As Robb J observed in Desane Properties Pty Limited v State of New South Wales:[2]

“Where documents are electronically ‘copied’ in a chain of emails … it is necessary to consider the circumstances in which the emails were produced and the final chain sent to its addressee.”[3]

2. [2018] NSWSC 173.

3. At [176], citing Asahi Holdings (Australia) Pty Ltd v Pacific Equity Partners Pty Limited (No 4) [2014] FCA 796 at [27]-[44] (Beach J).

11. Robb J continued that:

“… in a particular case, an examination of the final email in the chain in the context of the chain, as a whole, may justify treating the whole chain as if the individual emails had intentionally been copied for a protected purpose.”[4]

4. At [181].

12. Further, as was observed by Moshinsky J in Commissioner of Taxation v PricewaterhouseCoopers:[5]

“… it may be that the latest email in the chain is not privileged, but the penultimate email (in time) may be a communication made for the dominant purpose of the giving or receiving of legal advice, and the earlier emails are to be regarded as copy documents which have been provided for the same dominant purpose.”[6]

5. [2022] FCA 278.

6. At [175], citing Kenquist Nominees Pty Ltd v Campbell (No 5) [2018] FCA 853 at [19] (Thawley J).

13. Thus, in relation to email chains which include communications created for the dominant purpose of giving or seeking legal advice but which contain later emails, the question is whether the later emails bespeak conduct inconsistent with the maintenance of privilege, such as to amount to a waiver of the privilege.

14. The evidence before me established that there was, on the face of it, a proper claim by Calibre for client legal privilege such that I felt able to inspect the documents in question.

15. Having done so, it is clear to me that each of the email chains in question constitutes a communication which, taken as a whole, is the subject of client legal privilege.

16. Document 1 includes legal advice from Herbert Smith Freehills in relation to communication received by Calibre from ASIC. The email from ASIC would not, taken alone, be privileged. However, in the context of the communication taken as a whole, and in the light of the advice given about that communication by Herbert Smith Freehills, it becomes part of a communication which is, overall privileged.

17. Documents 2 and 3 include legal advice given by Ms Karen Evans-Cullen, which advice has been distributed to officers of Calibre in circumstances which are not inconsistent with the maintenance of privilege.

18. There was debate before me as to whether Ms Evans-Cullen was acting in a legal capacity when she gave the advice in question.

19. It is clear from the documents that she did so as, on each occasion, she is described as “PwC | Partner | Legal”.

20. The remaining documents constituted requests for advice from Norton Rose Fulbright and the provision of such advice, together with later emails distributing that advice, in circumstances which were not inconsistent with the maintenance of privilege.

21. Accordingly, I upheld Calibre’s claim for privilege in relation to each of the documents.

The privilege claimed by G&S

22. Documents 1 to 5 concern advice given by Ms Ami Janson. Ms Janson is a solicitor employed by G&S. At the relevant time her role was “Contracts & Commercial Advisor Major Projects” although she had previously been employed by G&S as “Legal Counsel”.

23. G&S provided me, without objection from MACH, unredacted copies of the documents in respect of which privilege was claimed.

24. Document 1 comprises an advice given by Ms Janson. Although Ms Janson recorded herself, when giving that advice, as “Contracts & Commercial Advisor Major Projects”, the advice itself is plainly legal advice. The later emails in the relevant email chain are not inconsistent with the preservation of privilege in relation to that advice.

25. Documents 2, 3 and 4 are copies of Board Minutes which, G&S submitted, summarise Ms Janson’s advice.

26. I do not accept that submission. The relevant extract refers to “significant uncertainty” and “potential disputes” which may be conclusions drawn from Ms Janson’s advice. But the advice is not referred to. The extract also refers to PwC being briefed about the matter. That alone cannot make the passage privileged.

27. Document 5 is a further extract from a Board Minute which is stated to summarise a “legal review”. That document is privileged.

28. Documents 6 and 7 are email chains which speak of the need to obtain legal advice about the particular issues. The documents themselves are not privileged.

29. Document 8 is an extract of draft minutes from a board teleconference meeting. It refers to a matter being considered further by “PwC Legal” and was evidently made for the dominant purpose of conveying the advice given by PwC Legal. That document is privileged.

30. It is agreed that the claim for privilege in relation to document 9 depends on the answers given in relation to documents 2, 3 and 5.

31. Document 10 is a further extract from a Board Minute which refers to a briefing note which is said to have been provided by G&S to another company on a without prejudice basis. The extract does not say so and I can see no basis from which it could be concluded that without prejudice privilege applies to the extract.

32. Document 11 is a Board Minute which includes a recommendation that advice be obtained from Clayton Utz. The extract itself is not privileged.

Conclusion

33. For those reasons, I came to the conclusions concerning privilege communicated to the parties on 31 August 2022.

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Endnotes

Amendments

31 August 2022 - Amendment to parties' representation on cover sheet.