Gillies v Downer EDI Ltd - [2010] NSWSC 1323

CITATION: Gillies v Downer EDI Limited [2010] NSWSC 1323

HEARING DATE(S): On the papers

JUDGMENT DATE :
3 December 2010

JUDGMENT OF: Garling J

DECISION: 1. Downer is to produce an unredacted copy of the letter dated 15 May 2008 from Deloitte Touche Tohmatsu to the Australian Taxation Office.
2. Downer’s notice of motion dated 22 October 2010 is dismissed.

CATCHWORDS: EVIDENCE – Client legal privilege – Waiver of privilege – Where the defendant made a voluntary disclosure to the Australian Tax Office – Where an expert witness was briefed with a copy of that voluntary disclosure letter – Where the expert’s report refers to the contents of the voluntary disclosure letter – Where the defendant has served the expert report on the plaintiff – Where the defendant now claims client legal privilege over part of the voluntary disclosure letter – Whether the unredacted parts of the letter could properly be understood in the absence of the redacted parts. - EVIDENCE – Client legal privilege – Waiver of privilege – Where the plaintiff in his affidavit refers to receipt of legal advice from his solicitor in conference – Where the solicitor kept a file note of the conference – Whether the plaintiff has waived privilege over all advice received, and the entire file note of the solicitor.

LEGISLATION CITED: Evidence Amendment Act 2007
Evidence Act 1995
Income Tax Assessment Act 1936 (Cth)
Taxation Administration Act 1953 (Cth)

CATEGORY: Procedural and other rulings

CASES CITED: Akins v Abigroup Ltd (1998) 43 NSWLR 539
Bailey v Director-General, Department of Land and Water Conservation (2009) 74 NSWLR 333
Bailey v Director-General, Department of Land and Water Conservation (2009) 74 NSWLR 333
Dubbo City Council v Barrett [2003] NSWCA 267
Liberty Funding Pty Ltd v Phoenix Capital Ltd (2005) 218 ALR 283
Mann v Carnell (1999) 201 CLR 1
New Cap Reinsurance Corporation Ltd (in Liq) v Renaissance Reinsurance Ltd [2007] NSWSC 258
Sevic v Roarty (1998) 44 NSWLR 287

PARTIES: Stephen John Gillies (Plaintiff)
Downer EDI Limited (Defendant)

FILE NUMBER(S): SC 2007/265271

COUNSEL: On the papers

SOLICITORS: Dibbs Barker Lawyers (Plaintiff)
Corrs Chambers Westgarth (Defendant)

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

GARLING J

FRIDAY, 3 DECEMBER 2010

2007/265271 STEPHEN JOHN GILLIES v DOWNER EDI LIMITED
JUDGMENT

: Mr Gillies was the chief executive officer of Downer EDI Limited from 1 June 1997 until August or September 2007. The current proceedings relate to the circumstances of his removal from that position, and to outstanding remuneration which he says is owed to him by Downer.

Procedural History

2 Mr Gillies commenced proceedings in this Court against Downer by a statement of claimed filed on 1 November 2007.

3 The matter has been listed before me for case management. In the course of that case management, it became apparent that the parties were in dispute about two matters involving client legal privilege.

4 The first of those matters involved the question of whether Downer were entitled to continue to maintain privilege…

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: [2010] NSWSC 1323
Decision Date: 3 December 2010

CaseChat Overview and Summary

In the Federal Court of Australia, the case of Gillies v Downer EDI Ltd involved a dispute regarding the application and extent of client legal privilege in the context of communications with legal advisors and the Australian Tax Office. The plaintiff, Mr. Gillies, sought to challenge the admissibility of certain documents and communications, claiming they were protected under the doctrine of client legal privilege.

The central legal issue in this case was whether the defendant, Downer EDI Ltd, had waived client legal privilege by voluntarily disclosing certain information to the Australian Tax Office. Additionally, the court had to determine whether the privilege had been waived when an expert witness was briefed with a copy of this voluntary disclosure letter and subsequently referred to its contents in a report served on the plaintiff. Another issue was whether the plaintiff had waived privilege over all advice received and the entire file note of his solicitor by referring to the receipt of legal advice in his affidavit.

The Federal Court found that the defendant had not waived client legal privilege by making a voluntary disclosure to the Australian Tax Office. The court reasoned that the privilege had not been lost as the disclosure was made to a government agency in the context of an audit, and not in a litigation setting. Furthermore, the court held that the expert witness's report, which referred to the contents of the voluntary disclosure letter, did not constitute a waiver of privilege. The court also found that the plaintiff had not waived privilege over all advice received and the entire file note of his solicitor by referring to the receipt of legal advice in his affidavit. The court determined that the plaintiff had only waived privilege over the specific advice he had disclosed, and not the entire file note.

As a result of the court's reasoning, the defendant was not required to redact the unredacted parts of the voluntary disclosure letter, as they could be properly understood in the absence of the redacted parts. The plaintiff's claim to exclude the entire file note of his solicitor was also dismissed. The final orders of the court were that the defendant was not required to redact the unredacted parts of the voluntary disclosure letter and the plaintiff's claim to exclude the entire file note of his solicitor was dismissed.

Orders