Grahame v Lang Corporation Limited
[2001] FCA 1308
•12 SEPTEMBER 2001
FEDERAL COURT OF AUSTRALIA
Grahame v Lang Corporation Limited [2001] FCA 1308
Statutes
Trade Practices Act 1974 (Cth) s 52
Cases
Dingle v Commonwealth Development Bank of Australia (1989) 23 FCR 63, 66 Referred to
Esso Australia Resources Limited v Commissioner of Taxation of the Commonwealth of Australia (1999) 201 CLR 49 Cited
ANTHONY WAYNE GRAHAME v LANG CORPORATION LIMITED, CHRISTOPHER D’ARCY CORRIGAN, PCS OPERATIONS PTY LTD, PCS RESOURCES PTY LTD, P AND C STEVEDORES PTY LTD, DONALD GORDON McGAUCHIE, PAUL XAVIER HOULIHAN AND JAMES WILLIAM FERGUSON
QG 132 OF 2000KIEFEL J
BRISBANE12 SEPTEMBER 2001
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
Q132 OF 2000
BETWEEN:
ANTHONY WAYNE GRAHAME
APPLICANTAND:
LANG CORPORATION LIMITED
(ACN 008 660 124)
FIRST RESPONDENTCHRISTOPHER D’ARCY CORRIGAN
SECOND RESPONDENTPCS OPERATIONS PTY LTD
(ACN 081 231 049)
THIRD RESPONDENTPCS RESOURCES PTY LTD
(ACN 081 231 021)
FOURTH RESPONDENTP AND C STEVEDORES PTY LTD
(ACN 081 225 078)
FIFTH RESPONDENTDONALD GORDON McGAUCHIE
SIXTH RESPONDENTPAUL XAVIER HOULIHAN
SEVENTH RESPONDENTJAMES WILLIAM FERGUSON
EIGHTH RESPONDENT
JUDGE:
KIEFEL J
DATE:
12 SEPTEMBER 2001
PLACE:
BRISBANE
THE COURT ORDERS THAT:
1.The documents produced to the court by the Australasian Stevedores Guild Inc and Paul John Leigh McTernan in response to the subpoenas issued by the third to fifth respondents on 17 August 2001 be forthwith returned to them.
2.Those respondents pay the costs of the Guild, Mr McTernan and the solicitor Mr Scott in connexion with those subpoenas, the subpoena issued on 3 September 2001, the hearing on 7 September 2001, and any reserved costs.
Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
Q132 OF 2000
BETWEEN:
ANTHONY WAYNE GRAHAME
APPLICANTAND:
LANG CORPORATION LIMITED
(ACN 008 660 124)
FIRST RESPONDENTCHRISTOPHER D’ARCY CORRIGAN
SECOND RESPONDENTPCS OPERATIONS PTY LTD
(ACN 081 231 049)
THIRD RESPONDENTPCS RESOURCES PTY LTD
(ACN 081 231 021)
FOURTH RESPONDENTP AND C STEVEDORES PTY LTD
(ACN 081 225 078)
FIFTH RESPONDENTDONALD GORDON McGAUCHIE
SIXTH RESPONDENTPAUL XAVIER HOULIHAN
SEVENTH RESPONDENTJAMES WILLIAM FERGUSON
EIGHTH RESPONDENT
JUDGE:
KIEFEL J
DATE:
12 SEPTEMBER 2001
PLACE:
BRISBANE
REASONS FOR JUDGMENT
The PCS respondents have issued two subpoenas directed to the Australasian Stevedores Guild Inc (“the Guild”) and to its President, Mr McTernan. A third subpoena, directed to the applicant’s solicitor, Mr Scott, does not presently require attention.
The subpoenas seek:
“1. All statements:
(a)in your possession; or
(b)in the possession of ASG Dynamic Solutions, a registered business name;
prepared by or on behalf of members of the Australasian Stevedores Guild Inc (ASG) pursuant to the ASG request for information from its members which information was to be provided in a form that accorded with the Statement Proforma prepared by the ASG to its members, a copy of which is attached to this subpoena.
2.All documents relating to or required for the incorporation of the ASG, including but not limited to the application for incorporation of an association.
3. Copies of ASG Newsletters for the period October 1998 to the present date.”
The second category of document is not now in contention.
The Statement of Proforma attached to the subpoena is a document providing instructions to members of the Guild with respect to the preparation of a statement in which they are to detail any representations made to them, and details of contracts entered into with PCS respondents, amongst others.
The Guild and Mr McTernan have produced documents to the court in response to the subpoenas. They attack the subpoenas on two bases: that the material sought has no relevance to the issues in the proceedings and that the documents are subject to legal professional privilege. The latter took up much of the argument on the hearing.
The PCS respondents in their submission raised a question as to whether there could now be an application to strike out the subpoenas given that the documents have already been produced. The subpoenas have in that sense been answered. They submit that the court is now merely concerned with whether they should be permitted access to the documents. There is in any event no doubt that the substance of the objections must be dealt with and there has been no waiver of them. The issues raised would then seem to be relevant only to the orders which might be framed if the Guild and Mr McTernan’s claims were vindicated.
The PCS respondents contended that, at the time the statements were forwarded in response to the pro forma document, there was no solicitor-client relationship between the person making the statement and the solicitor then employed by the Guild. That firm of solicitors is the solicitor on the record for the applicants in each of the representative proceedings.
As at 16 October 1998 the Guild had been recognised as an unincorporated association made up of a number of persons including Mr McTernan. Those persons appear to have taken steps in the name of the Guild prior to that recognition. It does not appear to me to be necessary to determine the identity of each of the members of that group. On about 11 October 1998 Mr McTernan published a letter under the heading “Australian Stevedores Guild”. There appears to have been an error since it should have referred to the Australasian Stevedores Guild. The letter sought members of the Guild “to keep in touch with all former PCS members in each State”. It is not completely clear what was then proposed but there were references to them continuing as a viable alternate workforce on the docks and also for “legal costs representation for the group as required”. The first newsletter of the Guild was sent by Mr McTernan as President on about 25 October 1998. The Proforma Statement accompanying the subpoenas was attached to that newsletter. It was addressed to “ex-members of PCS” and fellow members (of the Guild). It advised of legal action which had already been commenced against the directors of one of the PCS companies and others, including the Commonwealth Government, in which it was alleged that they had engaged in misleading and deceptive conduct. The two men who had brought the action had made claims with respect to losses suffered by them as a result of relying on the representations. The Guild advised that it had made a submission to several legal firms and, based on the evidence that it had supplied, had received advice that compensation would be awarded for breach of s 52 Trade Practices Act 1974 (Cth). Mr McMcTernan said that sometime in October he had seen the solicitors who came to act for the Guild. Mr McTernan advised that “we” have “negotiated on your behalf what we think will be the ‘best deal for our dollars with one of those firms’”. The firm’s name was not provided, it was said for reasons of security, but the terms of the agreement were. They included that:
“Each member of the ASG will have the opportunity to produce a statement detailing their losses before during and after the docks dispute which will be tendered as evidence in the Federal Court to assess the suffering individuals sustained and will provide a basis from which compensation may be awarded.”
It was predicted that two hundred people would join in and contribute to a fund. A national meeting was to be called on 1 November 1998 in order that member’s questions about litigation could be answered.
Application for incorporation of the Guild was made on 27 October 1998. It was not incorporated until December 1998. In the meantime, in early November 1998, a client agreement was signed by “the Guild” with the solicitor.
There is no doubt that statements were sent to the Guild or to Mr McTernan under his trading name, ASG Dynamic Solutions. He, or some entity trading under that name, continues to conduct paralegal activities in connexion with the litigation in an endeavour to minimise costs. The statements received were passed onto the solicitors. The solicitors also received some statements directly from people who had been employed by the PCS respondents.
It is asserted that there were twenty-two persons who gave statements, but for whom there is no client agreement, and that fourteen of the persons who gave statements are not members of the Guild. Individual client agreements with group members were signed later, but the PCS respondent’s point is that they were not in existence at the time the statements were forwarded and so legal professional privilege did not attach to them.
The fact that at the relevant time client agreements were not signed, either by the incorporated association or the individual members of the Guild, would not seem to me to conclude whether a solicitor-client relationship existed, although it may have an effect upon the solicitor’s remuneration. Before the members, or future members, of the Guild were canvassed, it seems to me that the solicitor’s client was those persons for whom Mr McTernan, and perhaps some others in the group, spoke. That general position maintains.
Representative or class actions result in somewhat different relationships at the outset between a solicitor and those who seek to be involved in the litigation. In such situations the solicitors are usually retained by one or more persons or entities to act for the benefit of many. At this point the relationship between the solicitor and the person having such an interest in the litigation may often be determined by reference to the authority which can be imputed to the organiser from the members of the group and the nature of the steps taken towards litigation. As the litigation progresses the relationship of solicitor and client may become more clearly defined. In the present case it would seem to me that members who responded by providing statements to the Guild or Mr McTernan were seeking to have the solicitors put their case forward and advise them as necessary. Mr McTernan was impliedly authorised to act as intermediary in that process. That the name of the solicitor was suppressed in the newsletter would not alter the situation. Guild members providing the statement could require the name to be provided. The position of those persons who sent the statements direct to the solicitors is even more clear. As a submission made by counsel for the Guild and Mr McTernan points up, it would not matter if the direct relationship did not subsist. If one viewed the Guild members as third parties providing evidence to enable the Guild, Mr McTernan or whoever was the client of the solicitors to obtain advice, the privilege would attach. If a written communication is made for the dominant purpose of obtaining legal advice, it is privileged from production: Esso Australia Resources Limited v Commissioner of Taxation of the Commonwealth of Australia (1999) 201 CLR 49. (I add that here the documents would pass the former sole purpose test.) The rationale for the protection, when it extends to documents from third parties and not the client, is that a party is not bound to reveal statements taken from witnesses and others for the purposes of the litigation: Dingle v Commonwealth Development Bank of Australia (1989) 23 FCR 63, 66. That would seem to me to be a complete answer to the documents required by paragraph 1 of the Schedule to the subpoena. With respect to these documents it is not necessary to determine the question of whether they are relevant or whether they are an abuse of process.
There remains the question of the newsletters which were thereafter sent by the Guild to members. It was asserted that the newsletters were sent to a number of persons who were not parties to the litigation, but it was not made plain to me how this conclusion was arrived at. Mr McTernan has given evidence that the newsletters are forwarded only to members and not others. The contrary was not established when he was cross examined. If there are members of the Guild who are not identified as group members the most that could be said is that their relationship with the solicitor might be unclear. A waiver has not been established.
The purposes of the newsletter include the provision of lawyer’s advice to the members by a medium which is considered to be cost effective. The newsletters often include extracts from the solicitor’s letters. There are other purposes, such as keeping members informed of matters affecting other members, but nothing which would distract from the main purpose of the communication, being advice concerning the progress of the litigation. At this point in the litigation one would think that the nature of the advice being given provides the answer. There is a relationship of solicitor and client between the Guild members and the solicitor.
I will order that the documents produced to the court be returned to the solicitors for the Guild and Mr McTernan. The PCS respondents should pay the costs of those parties and of the solicitor Mr Scott in connexion with the subpoenas and the hearing.
I certify that the preceding fifteen (15) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Kiefel .
Associate:
Dated: 12 September 2001
Counsel for the Applicant: Mr M Jarrett Solicitor for the Applicant: Klooger Phillips Scott Counsel for the third to eighth Respondents: Mr P Jopling QC and Mr J Bourke Solicitor for the third to eighth Respondents: Minter Ellison Counsel for the Australasian Stevedores Guild Inc and Mr McTernan Mr D Wenck Solicitors for the Australasian Stevedores Guild Inc and Mr McTernan Klooger Phillips Scott Date of Hearing: 7 September 2001 Date of Judgment: 12 September 2001
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