Hancock v Rinehart

[2017] NSWSC 530

Supreme Court

New South Wales

Medium Neutral Citation:	Hancock v Rinehart (Freehills subpoena) [2017] NSWSC 530
Hearing dates:	30 March 2017
Date of orders:	04 May 2017
Decision date:	04 May 2017
Jurisdiction:	Equity
Before:	Brereton J
Decision:	See [65].
Catchwords:	EVIDENCE – privilege – legal professional privilege – subpoenas – application to set aside subpoena alleging abuse of process and privilege – not a collateral attack on a previous order – held, not an abuse of process -- if documents privileged, no waiver in the circumstances – applicant fails to establish privilege against respondent in respect of contested documents – held, subpoena not set aside.
Cases Cited:	Attorney-General for the Northern Territory v Kearney (1985) 158 CLR 500 AWB Ltd v Cole (No 5) [2006] FCA 1234 BBGP Managing General Partner Ltd v Babcock & Brown Global Partners [2011] Ch 296; [2011] 2 All ER 297 British Coal Corp v Dennis Rye Ltd (No 2) [1988] 1 WLR 1113; [1988] 3 All ER 816 Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501; [1997] HCA 3 Cook v Pasminco Pty Ltd (No 2) (2000) 107 FCR 44 CSR Ltd v Eddy (2008) 70 NSWLR 725; [2008] NSWCA 83 D A Christie Pty Ltd v Baker [1996] 2 VR 582 Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Limited (2013) 250 CLR 303; (2013) 303 ALR 199; (2013) 88 ALJR 76; [2013] HCA 46 Farrow Mortgage Services Pty Ltd (in liq) v Webb (1996) 39 NSWLR 601 Goldberg v Ng (1995) 185 CLR 83; 132 ALR 57 Goldman v Hesper [1988] 1 WLR 1238; [1988] 3 All ER 97 Gotha City v Sotheby's [1998] 1 WLR 114 Grant v Downs (1976) 135 CLR 674 Hancock v Rinehart (Privilege) [2016] NSWSC 12 Hancock v Rinehart [2015] NSWSC 1311 Hastie Group Limited v Moore [2016] NSWCA 305 Hellenic Mutual War Risks Association (Bermuda) Ltd v Harrison (The "Sagheera") [1997] 1 Lloyd’s Rep 160 Holmes v Deputy Commissioner of Taxation (1987) 19 ATR 1278 Lazenby v Zammit [1987] Tas R 54 Mann v Carnell (1999) 201 CLR 1; 168 ALR 86; [1999] HCA 66 National Crime Authority v S (1991) 29 FCR 203; 100 ALR 151; [1991] FCA 234 Nominal Defendant v Manning [2000] NSWCA 80; (2000) 50 NSWLR 139 Osland v Secretary Department of Justice [2008] HCA 37; (2008) 234 CLR 275; (2008) 249 ALR 1; (2008) 82 ALJR 1288 Pascoe v Boensch [2007] FMCA 1214 Rinehart v Rinehart [2016] NSWCA 58 Schreuder v Murray (No 2) (2009) 260 ALR 139; 41 WAR 169; [2009] WASCA 145 Thomason v Campbelltown Municipal Council (1939) 39 SR(NSW) 347 TSB Bank plc v Robert Irving & Burns [2000] 2 All ER 826 Wentworth v De Montfort (1988) 15 NSWLR 348
Category:	Procedural and other rulings
Parties:	John Langley Hancock (first plaintiff) Bianca Hope Rinehart (second plaintiff) Gina Hope Rinehart (first defendant) Hancock Prospecting Pty Ltd (fourth defendant)
Representation:	Counsel: C. Withers w P. Meagher (plaintiffs) B.R. McClintock SC w R. Mansted (first defendant) J. Giles SC w T. O’Brien (fourth defendant)   Solicitors: Yeldham Price O’Brien Lusk (plaintiffs) Speed and Stracey (first defendant) Corrs Chambers Westgarth (fourth defendant)
File Number(s):	2011/285907

Judgment

1. On 28 May 2015, in connection with the appointment of the second plaintiff Bianca as new trustee of the Hope Margaret Hancock Trust (“the HMH Trust”) in place of the first defendant Mrs Rinehart, an order was made for the delivery up by Mrs Rinehart to Bianca of the “documents of the trust”. Bianca contends that Mrs Rinehart has failed to deliver up certain trust documents, and by notice of motion filed on 3 September 2015 seeks further orders to give effect to the order of 28 May 2015 in connection with the production of the trust documents (“the 3 September 2015 motion”).

2. The 3 September 2015 motion was part-heard on 3 November 2015. However, its disposition has been affected by a number of ancillary proceedings. First, concurrent with that hearing, there was a contentious claim for privilege by Mrs Rinehart over certain documents which had been produced, on a subpoena for production issued on 26 August 2015, at Bianca’s request, to Sceales & Company Lawyers: see Hancock v Rinehart(Privilege) [2016] NSWSC 12 (2 February 2016) and Rinehart v Rinehart [2016] NSWCA 58 (24 March 2016). As those documents were sought in connection with the 3 November motion, it could not be concluded until the privilege dispute was resolved. Ultimately, the hearing of the remainder of the 3 September 2015 motion was fixed for 11 May 2016, and proceeded that day, when it was adjourned part-heard to 3 June 2016, when judgment was reserved. However, on 22 July 2016, Sceales & Company (belatedly) produced further documents pursuant to the 26 August 2015 subpoena. On 2 August 2016, directions were made in respect of access and privilege claims, and on 11 August further directions were made for evidence in respect of the claims for privilege advanced by the defendants, the hearing of which was appointed for 18 August 2016. At the hearing on 18 August, I gave an ex tempore judgment rejecting the claim for privilege and granting access to the documents in respect of which privilege had been claimed, following which Mr Withers, for the plaintiffs, sought and was granted leave to tender them on the 3 September 2015 motion, and to make submissions in respect of them, which were completed later that day.

3. However, it was not long before a new issue arose. On 9 August 2016, Bianca had requested the law firm Herbert Smith Freehills (“Freehills”) – which had, under an earlier guise, acted for Mrs Rinehart, at least including in her capacity as trustee of the HMH Trust although possibly also in other capacities and for other Rinehart entities – to deliver up to Bianca a copy of all documents held by Freehills that were created or received in connection with advice provided by it to the HMH Trust. After some further exchanges of correspondence, Freehills on 7 October 2016, without Mrs Rinehart’s knowledge or consent (but in circumstances in which Freehills understandably but mistakenly believed that she had been afforded an opportunity to object) delivered up to Bianca 43 documents (“the Freehills documents”), on the footing that they were trust documents to which Bianca as the new trustee was entitled. By motion filed in court on 31 October 2016 – earlier informal notice of it having been given – Mrs Rinehart applied for orders restraining the plaintiffs from using 27 of the Freehills documents (“the contentious documents”), and requiring their return to Freehills or to her. That application was heard on 31 October 2016, when I held that the 27 contentious documents should be returned to Freehills or the defendants. It will be necessary to return to those proceedings, and the basis on which that order was made. Leave was granted to Bianca to reopen the evidence and submissions on the 3 September 2015 motion in order to adduce in evidence those of the Freehills documents that were not to be returned, and to make submissions about them. That leave was exercised subsequently on the same day.

4. Following correspondence between the solicitors for the parties, and in circumstances where, the parties being in dispute, Freehills (reasonably) declined to release any further documents to her, on 2 December 2016 Bianca caused to be issued a subpoena to Freehills (“the Freehills subpoena”) for production of 25 of the 27 contentious documents (“the documents in issue”). [1] By notice of motion filed on 31 January 2017, Mrs Rinehart applied to have that subpoena set aside, or alternatively access refused to the documents produced in response to it, save for four specified documents, and in respect of them only to the extent they had not been redacted. It is that motion with which this judgment is concerned. Mrs Rinehart contends that (save for the unredacted portions of documents 13, 15, 22 and 43), the 25 documents in issue (1) are not documents of the HMH Trust; (2) are the subject of her personal legal professional privilege, or that of HPPL; and (3) are not required for any legitimate forensic purpose. HPPL supports Mrs Rinehart’s claim to have the subpoena set aside so far as it concerns Document 14, and for access to be restricted to the unredacted portion only of Document 43.

   1. Because the subpoena is framed with reference to a list of the 43 documents originally delivered up by Freehills to Bianca, their enumeration extends to 43, although not consecutively as production of only 25 specified documents from the original list of 43 is now sought. Bianca does not press for two of the original 27 contentious documents, namely documents 3 and 4.

Abuse of process

5. For Mrs Rinehart, Mr McClintock SC first contended that the Freehills subpoena constituted an abuse of process by reason that it sought production of the very documents which I had on 31 October 2016 held should be returned to Freehills – their production having twice previously been sought by Bianca, first by letter to Freehills of 9 August 2016, and secondly by a notice to produce issued in connection with the 31 October 2016 hearing. This argument, and some other aspects of the application, require that consideration be given to the basis of my decision of 31 October 2016.

6. The hearing of that date was conducted under some pressure of time; another case was waiting. The transcript records, following the oral submissions of the parties on the application for return of the contentious documents: [2]

HIS HONOUR: For reasons which I shall give, if necessary, at a later date, I am satisfied that the defendants are entitled to succeed on their motions and that the disputed documents should be returned to them or to Freehills

2. 31/10/16 T20.19.

7. Subsequently, I made the following order in respect of a motion that had been filed by the plaintiffs:

On the plaintiff’s motion of 13 October 2016, THE COURT ORDERS THAT:

The plaintiff have leave to reopen the evidence and submissions in respect of her notice of motion filed 3 September 2015, as amended 12 May 2016, in order to:

…;

(b) adduce as evidence the documents provided to the second plaintiff by Herbert Smith Freehills pursuant to the second plaintiff’s request dated 9 August 2016, other than those which are to be returned to the defendants and/or Herbert Smith Freehills, and the advice from Cocks Macnish dated 28 July 1995, …

8. Reasons were not subsequently requested and so were not then prepared. It is clear enough from the transcript that I regarded the question of confidentiality as irrelevant, and was of the view that if the contentious documents were not trust documents, then Freehills ought not have delivered them up to Bianca, regardless of whether or not they were “confidential”. [3]

   3. 31/10/16 T15.34; T15.47.

9. Undoubtedly, one of the issues then argued was that the contentious documents were not trust documents. However, it does not follow that I determined that they were not trust documents, nor that their production served no legitimate purpose in connection with the 3 September 2015 motion. A critical fact was that, in response to Bianca’s 9 August 2016 request, Freehills had sent an email addressed to Mrs Rinehart’ solicitors to give notice of their intention to accede to Bianca’s request but afford Mrs Rinehart a prior opportunity to object; however, the email was accidentally misaddressed and as a result did not come to the attention of Mrs Rinehart’s solicitors. It could not be doubted that had it done so, objection would have been taken, in which case Freehills would at least have undertaken a more rigorous examination of the issues before delivering up the documents, and Mrs Rinehart would have had an opportunity to approach the court. Due to this innocent mistake in respect of the email address, there was a miscarriage of due process in this respect, which deprived Mrs Rinehart of an opportunity to be heard on the question. Moreover, from the description of the contentious documents set out in her solicitor’s affidavit of 28 October 2016, they were not self-evidently trust documents: there was at least a tenable argument to the contrary, and it was evident that at least in respect of one document (which plaintiffs’ counsel conceded was not a trust document), the process had miscarried. Though the contentious documents were produced and tendered at the 31 October 2016 hearing, they were not the subject of close examination in the course of submissions.

10. Thus I decided that there had been a mistake in the process by which the Freehills documents had been delivered up to Bianca; that it was not unarguable that the contentious documents were not trust documents and should not have been delivered up at her request as new trustee; and that in those circumstances they should be returned, so that a proper process in respect of the claim for their production, which respected Mrs Rinehart’s interest, could take place. This is consistent with Mr McClintock’s then submission [4] – albeit now said to be his secondary position: [5]

In my submission, these documents ‑ the ones we've identified ‑ are not trust documents. They should go back to Freehills and they should do the job properly.

4. 31/10/16 T20.01-03.

5. 30/03/17 T5.46.

11. Likewise, Mr Giles had submitted: [6]

It should go back to Herbert Smith for the task to be done properly.

…

Now, my point in referring at the start to some of the reasoning that appeared on p 27 of DX402 is that the exercise undertaken by Freehills has gone wrong. It doesn't matter why it's gone wrong. They’ve made some assumptions. What your Honour ought to do is make an order requiring return of these documents, either those which are obviously ours can come back to us or back to Herbert Smith, and tab 43 should go back to Herbert Smith, so that they who, for example, know who “PDE” is when referring to a partner and the like can actually work it out, do the task properly.

6. 31/10/16 T12.11-39.

12. Essentially, I acted on the principle that ordinarily, where a privileged document is inadvertently disclosed, the court should permit the correction of the mistake and order the return of the document, if the party receiving the documents refuses to do so. [7] That was all that was required to support the decision; it was not necessary to the decision to go further and conclude that the lls documents were not trust documents. I did not intend to decide whether or not they were trust documents – an issue which I have deliberately eschewed deciding on any of the ancillary applications, as the central issue on the still-outstanding 3 September 2015 motion involves the scope of the notion of a “trust document”.

    7. Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Limited (2013) 250 CLR 303; (2013) 303 ALR 199; (2013) 88 ALJR 76 at [45].

13. Insofar as it is objected that production of the same documents was sought pursuant to Bianca’s notice to produce of 28 October 2016, that was in connection with the hearing on 31 October. The contentious documents were produced and tendered (ultimately, on behalf of Mrs Rinehart), as evidence on the application for their return, which succeeded. But that was a step preliminary and anterior to their use on the 3 September 2015 motion. The question of their use on the 3 September 2015 motion was and is independent from and subsequent to the question of their delivery up and/or return. There was no decision that the contentious documents were irrelevant to the 3 September 2015 motion, nor that there was no legitimate forensic purpose in requiring their production. Nor does the Freehills subpoena represent an impermissible “second contested run at the target”,[8] all the moreso in circumstances where the first run (the notice to produce) was uncontested, and culminated in the production and tender of the contentious documents in the 31 October hearing, to be returned not on the basis that they were irrelevant to the 3 September 2015 motion, but in order to enable proper scrutiny and argument before they were produced.

    8. Cf D A Christie Pty Ltd v Baker [1996] 2 VR 582; Nominal Defendant v Manning [2000] NSWCA 80; (2000) 50 NSWLR 139 at [10] (Mason P); [72] (Heydon JA); Hancock v Rinehart [2015] NSWSC 1311 at [12]-[14].

14. It was further argued that there could be no legitimate forensic purpose in requiring production of the documents in issue in connection with the 3 September 2015 motion, as (1) the only question on that motion was whether Mrs Rinehart had delivered up all documents of the trust in her possession custody or power; and (2) the documents in issue could not bear on that question because it had already been determined, by the decision of 31 October 2016, that they were not trust documents.

15. Accepting for present purposes, without deciding, the first limb of that submission, the second fails at two levels: first, because for reasons already explained, the decision of 31 October 2016 did not determine that the contentious documents were not trust documents; and secondly, whether or not a document in issue is a trust document is not conclusive of whether it has adjectival relevance, in the sense in which that term is used in the law relating to subpoenas – that is to say, whether it may “cast light on” the issue. [9] Nor does the mere circumstance that the subpoena is not couched in terms of requiring documents “relating to” the trust, or “created or received in the course of Freehills' retainer by the trustee”, mean that the documents specified in it are not relevant; indeed it is preferable that a subpoena – especially one to a non-party – identify the particular documents sought, rather than require the recipient to make a judgment as to whether or not they relate to a matter. In the context that Freehills admittedly had a retainer to act for Mrs Rinehart as trustee of the HMH Trust, and initially produced the documents in issue on the basis that they were trust documents, it has not been established that the subpoena calls for documents which could not be relevant in applicable sense. Moreover, such documents could conceivably show that there are in existence documents – which fall within the broader notion of a “trust document” for which the plaintiffs contend, though not within the narrower concept for which the defendants argue – which have not been produced by Mrs Rinehart. This could be telling in the context of the Freehills documents, which have been fought over in Court for forensic purposes several times, so that Mrs Rinehart (and her advisers) have had to turn their minds to whether or not they fall within the scope of “trust documents”, so that error, if established, could not be explained by inadvertence, but only by misconception of what is a trust document.

    9. Cf Hancock v Rinehart (Privilege) [2016] NSWSC 12 at [3].

16. HPPL referred in particular to Document 14, described as a fax from HPPL to Freehills enclosing a list of open legal files for the Hancock Group prepared by Corrs Chambers Westgarth as at 12 July 1995, and submitted that there was no reason to believe that that document would be relevant to the issue whether Mrs Rinehart presently has additional “trust documents” that she has not disclosed. That submission suffers from the defects that (1) it is for the applicants to establish that the subpoena is too wide having regard to questions of relevance, a task which is more difficult where it specifies particular documents so as not to be oppressive in its scope; and (2) to the contrary, given the broad scope of the “Hancock Group”, and the known existence of a retainer to act for the trustee of the HMH Trust, it is well conceivable that such a list might reveal matters in which Corrs had been acting for the trustee of the HMH Trust, in respect of which documents might be retained by Corrs or by Freehills.

17. HPPL also referred to Document 43, a bundle of miscellaneous file notes and attendance notes prepared by Freehills recording attendances on officers of HPPL, and submitted that those documents were the property of Freehills and thus not a “trust document”. [10] While that may well be so, as already explained the fact that the documents may not be trust documents is not determinative let alone conclusive of their relevance in the context of a subpoena.

    10. Citing Wentworth v De Montfort (1988) 15 NSWLR 348 at 359F-360F.

12. Accordingly, it has not been determined that the documents in issue are not trust documents; nor that there is no legitimate forensic purpose in seeking their production in connection with the 3 September 2015 motion; nor does the Freehills subpoena involve a collateral attack on the decision of 31 October 2016 nor otherwise constitute an abuse of process.

Privilege - waiver

19. Mrs Rinehart claims that the documents in issue are privileged from production, by reason of legal professional privilege, in her personal (as distinct from trustee) capacity. Bianca’s first response to this was that any privilege Mrs Rinehart might have had in the documents in issue was waived, when her counsel produced the contentious documents in court of 31 October 2016 (their production having been called for pursuant to Bianca’s notice to produce of 28 October 2016) and subsequently tendered them as evidence in the application for their return. Although logically the question whether a document is prima facie privileged precedes the question of waiver, because Mr Withers propounded waiver as a complete response, even if privilege were otherwise established, it is convenient to address the waiver issue first.

20. Ordinarily, the intentional production of privileged documents in open court, and a fortiori their tender into evidence, would constitute a waiver. Is there anything in this case which deprives what happened of that consequence?

21. Reference has already been made to the circumstances by which the Freehills documents first came into Bianca’s possession. Those circumstances, which involved a mistake and an absence of any authority on the part of Mrs Rinehart, meant that her privilege subsisted in such of the documents as were her personally privileged documents. While, by reason of Freehills’ mistake, Bianca already had the documents, that was in circumstances where, once the mistake was known, she would have been impressed with an obligation not to disclose or use them, and indeed as I ultimately held to return them; and when the mistake was drawn to the attention of Bianca’s lawyers, they undertook not to make any use of the contentious documents pending determination of the application. Had the position remained thus, the privilege would have subsisted.

22. In support of the application for the return of the contentious documents, Mrs Rinehart’s solicitor swore, on 28 October 2016 (“the October affidavit”) an affidavit which inter alia (in paragraphs 46 to 49) referred to the contentious documents and described some of their characteristics and/or contents, but not so as to disclose or deploy their effect – in particular, the effect of any legal advice contained in them. The documents were so described in order to support the claim for their return on the basis that they were not documents of the trust.

23. Bianca then served a notice to produce the documents referred to in the solicitor’s affidavit. When that notice was called on, the following transpired: [11]

    11. 31/10/16 T3.29-5.38.

WITHERS: There is a notice to produce which was issued to Mrs Rinehart dated 31 October and I call on the notice to produce.

HIS HONOUR: Mr McClintock, an application to set aside?

MCCLINTOCK: No, there is not going to be. Before I go saying that, perhaps I can be absolutely clear just which notice to produce I am answering. My learned friend referred to one dated 31 October, which if I might say we only received at, I think, also 25 past 1, perhaps a little earlier.

HIS HONOUR: Presumptively it is a strong application to set it aside.

MCCLINTOCK: Your Honour.

HIS HONOUR: I am not inviting it.

MCCLINTOCK: Your Honour, what that notice to produce deals with is documents referred to by Mr Speed in paragraphs 46 to 49 of his affidavit, the one that I have just read. Now those are the documents which we assert are not trust documents and ought to be returned.

Now I don’t understand the purpose of the notice to produce but if it is called upon I can produce the documents to the Court, your Honour, obviously under objection because they are, on our case, confidential and if they are admitted into evidence I will be asking your Honour to make orders under the Court Suppression and Confidentiality Orders Act in relation to them.

HIS HONOUR: Well, Mr Withers is calling on the notice so the ball is in your court to do something.

MCCLINTOCK: Your Honour, in that case I can’t guarantee, for which I apologise, because of the time, a complete coincidence between the contents of the notice to produce and the contents of this folder which is titled “Freehills documents that ought to be returned”. I produce that folder. But I believe that thy will be virtually precisely the same documents, though I can’t be completely precise about it. I produce to the Court under confidentiality and of privilege a folder entitled “Freehills documents that ought to be returned” (handed up).

HIS HONOUR: And access?

MCCLINTOCK: Your Honour, I don’t – I am not avoiding your Honour’s question, at least if I am it is only temporarily. I don’t have a complete understanding of whether my learned friends have seen these documents already. If they have seen the documents already and there is nothing to be learned from seeing them further, that might condition access, at least on a conditional basis, but these are the documents handed over by Freehills three or four weeks ago. The concern I, of course, have is that I don’t wish to be said to be waiving any confidentiality. I suppose the easiest way in the circumstances is to oppose access.

HIS HONOUR: Mr Withers?

WITHERS: We seek access, your Honour, because the documents are being deployed by Mrs Rinehart, and that’s in paragraphs 46 to 49 of the affidavit, where the affidavit recites part of the content of these documents and says to your Honour these documents are not about the trust. So we are in classic Mann v Carnell territory, DSE, the documents are being deployed against us and we are entitled to see them, your Honour. And as for confidentiality, of course we are bound by the implied undertaking.

HIS HONOUR: Not once you tender them.

MCCLINTOCK: Yes

WITHERS: Well, they are being deployed by my learned friend in support of the application for orders that they have the documents back. Your Honour can see it all through this affidavit of 46 through 49, it deposes to the contents of the very documents that we are fighting about and dare I say it, somewhat selectively, your Honour.

HIS HONOUR: In circumstances where the affidavit set out what it says is a summary of the effect of these documents and deploys them, it seems to me that the plaintiffs must be entitled to access.

MCCLINTOCK: Your Honour, may I say this, there is not, if your Honour looks at the documents, the paragraphs operate by way of negative exclusion saying what’s not in the documents.

HIS HONOUR: Yes.

MCCLINTOCK: I appreciate the repost that your Honour is going to give me, but that said there has been no disclosure of the content of the documents, but I don’t wish to take it any further.

GILES: Could I say this with respect to the four documents which concern me which are in that bundle, there can be no inconsistencies, as our learned friend Mr Withers puts it, between seeking to prove the confidentiality of the document, which through no fault of our is now is Ms Rinehart’s hands, and maintaining a confidentiality that this Court should make an order to require the return of the documents. There is an entire circularity to our learned friend’s submission.

WITHERS: It doesn’t affect my earned friend Mr Giles because his four documents are not referred to in this affidavit.

GILES: They are. They are referred to in paragraph 47(b), 47o), (p) and (q).

WITHERS: In any event –

HIS HONOUR: Yes, just hang on a moment. It seems to me that the paragraphs in question go beyond simply stating the negative and in many cases describe characteristics or contents of the documents in question. I have taken some little time to think about this because of its ultimate potential effect, but it seems to me that once the contents of these documents are deployed in the way that they are in paragraphs 46 and following that the plaintiffs must be entitled to access to the documents on which that commentary is based.

The plaintiffs may have access to the documents produced.

24. A number of observations should be made at this stge. First, the fact that a limited description of the documents was provided in the solicitor’s affidavit, to the limited extent and for the limited purpose that that was done, would not of itself have amounted to a waiver. It did no more than could properly have been done in an affidavit supporting a claim for privilege, or the privileged part of a list of documents. Had the position remained there, there would have been no waiver. Secondly, the documents were produced to the Court. No application was made to set aside the notice, and there was no objection to production to the Court on grounds of privilege. Had a claim of privilege been advanced in opposition to production of those documents, it would have been necessary to consider whether the deployment of the documents in the solicitor’s affidavit was such as to waive the privilege. I doubt that the fact that a limited description of the documents was given in the solicitor’s affidavit would have amounted to a waiver, and had privilege been asserted against their production, I doubt that production would have been required over objection. Thirdly, production was said to be “under confidentiality and of privilege”. Although production is, usually, inconsistent with maintaining a claim for privilege, and such words would amount to a futile attempt to avoid the legal consequences of producing the documents rather than objecting to production,[12] in the context of what had happened in this case – namely, that Bianca was already, albeit mistakenly, in possession of the documents in issue – those words indicated an intention to maintain a claim for privilege, notwithstanding that Bianca already had the documents. Fourthly, while access was opposed, the basis of opposition articulated was founded on doubt as to the purpose for which the plaintiffs sought access, not on a claim of privilege. Reference was made to “confidentiality”, but not to “privilege”, in the course of the argument. Thus the scope of the dispute appeared to be a disputed claim for access to documents that were said to be confidential; as is well known, mere confidentiality falling short of privilege is no answer to compulsory process and at best raises a discretionary issue about access. Fifthly, when I ruled in favour of access, and said that I had “taken some little time to think about this because of its ultimate potential effect”, I was referring to the potential circumvention of Mrs Rinehart’s claim for confidentiality, in the context that her claim was advanced as one for the return of her confidential documents. I was of the view that (1) the plaintiffs were already in possession of the documents in issue (albeit mistakenly so) and, but for the undertaking they had given, would have been able to use them at least for the limited purpose of resisting the application for their return; and (2) those documents and their contents were plainly relevant to the issues on the application for their return, and in circumstances where the solicitor’s October affidavit purported to make observations about them, the dictates of fairness to the plaintiffs in being able to test the solicitor’s description outweighed any claim of (mere) confidentiality. Sixthly, when the plaintiffs obtained access to the documents, they did so pursuant to compulsory process and subject to the implied undertaking to use them only for the purpose of the proceedings. In context, the relevant proceedings were those on the defendants’ motion of 31 October 2016 for return of the documents.

    12. See Hancock v Rinehart (Privilege) [2016] NSWSC 12 at [23]-[25].

25. Shortly after the passage extracted above, the following ensued: [13]

    13. 31/10/16 T6.10-7.15.

WITHERS: Sorry to interrupt, your Honour, but having just received these documents and not having had a sneak preview of the documents when they were first received, I am now looking at them for the first time and it may be that I wish to tender some of these documents on Mr McClintock’s application. But could I perhaps review them whilst he is speaking and then do it after that?

HIS HONOUR: Yes.

MCCLINTOCK: I will make it easy for my learned friend, I will tender them myself and seek an order under the Court Suppression and Non-publication Orders Act 2010, section 7 thereof.

WITHERS: Well, my learned friend can’t just ask for it, he has to put forward a basis for it, explain why these documents are confidential with respect to each one of them. That’s what the law requires and therefore justifies such an order being made, which of course is –

HIS HONOUR: But isn’t the point that it’s just on an interim basis at least to preserve the utility of this application?

WITHERS: Perhaps if it can be done on an interim basis through the hearing then I might make submissions at the end of the hearing about whether that confidentiality order should be maintained.

MCCLINTOCK: If I am wrong on my core point, the document is not confidential and my learned friend will get them. If I am right on my core point, then your Honour can see the utility of the application, for them to be tendered, as it were, in open court. I was going to use the copy that I had given to my learned friend, that would probably be little unfair in the circumstances. I will see if we have got another copy.

Your Honour, it is section 7 that I would prompt as the reason, the ground specified in ground 8(1)(a) “necessary to prevent prejudice to the proper administration of justice”.

HIS HONOUR: The court orders that until further order disclosure by publication or otherwise of the contents of exhibit DX406 be prohibited. This order is made on the ground referred to in Court Suppression and Non-publication Orders Act 2010 section 8(1)(a) that the order is necessary to prevent prejudice to the proper administration of justice and applies throughout the Commonwealth of Australia and applies until further order.

MCCLINTOCK: I also seek a further order that access in the interim be restricted to the legal advisers to the second plaintiff.

HIS HONOUR: Is there any problem with that, Mr Withers?

WITHERS: Yes. I would like to be able to discuss the documents, if necessary, with my clients. They will be covered by the same suppression order. It is unusual, in my submission, for an order that there be an order preventing me discussing these kinds of issues to get instructions from my client.

HIS HONOUR: I agree. Yes, I don’t think that I will make that order, Mr McClintock.

26. As is apparent from the above passage, the non-disclosure order was made to preserve the utility of the defendant’s application for return of the contentious documents; as Mr Withers acknowledged, it applied to prohibit the plaintiffs from disclosing those documents.

27. Argument then proceeded on Mrs Rinehart’s claim for return of the documents. While stating at the outset that it appeared that the issue was “are the documents confidential and/or privileged” [14] – which was clarified to mean confidential or privileged in the hands of Mrs Rinehart personally, not qua trustee [15] - Mr McClintock dealt with it “as in effect a question of confidentiality”. [16] As has been indicated above, I did not think this was the correct approach: regardless of whether the documents were confidential, if they were not documents of the trust they should not have been handed over by Freehills without Mrs Rinehart’s consent. In response, Mr Withers argued primarily that the documents were trust documents; that Freehills had apparently, before handing them over, undertaken a rigorous exercise to form the view that they were, so that there was no point in returning them to Freehills to do the job again; and that no attempt having been made to maintain their confidentiality as against the plaintiffs, any privilege had been lost. [17] In reply, Mr McClintock (understandably) focussed on whether the documents were trust documents, and the “mistake” point; he did not respond to Mr Withers’ “waiver” submission, but as the argument had developed it became clear that the issue was not confidentiality or privilege, but whether or not the documents were trust documents, and whether there had been a sufficient mistake in their initial disclosure to warrant a review.

    14. 31/10/16 T7.19-20.

    15. 31/10/16 T7.23-24.

    16. 31/10/16 T7.33-34.

    17. 31/10/16 T16.09-13.

28. It was in that context that I made the ruling referred to above, that the documents should be returned. The purpose of the order was to restore the position to that which obtained before the mistaken provision of the documents to Bianca. In the light of that ruling, no occasion arose to revisit the non-disclosure order which, being expressed to be “until further order”, remains in force.

29. As I have determined that the subpoena is not liable to be impugned on grounds of lack of apparent or potential relevance, the issue is whether Mrs Rinehart can now sustain a claim of privilege from production of documents which she must be taken to have deliberately not only produced but tendered, but to which the plaintiffs have been granted access only for the limited purposes of the motion then before the court, and subject to a non-disclosure order, and where an order has been made with the intent of restoring the status quo ante the mistaken production by Freehills.

30. For Mrs Rinehart, it was submitted that there is no waiver where documents are tendered for a limited purpose, such as to provide evidence necessary to procure an order for their return. Stated in those general terms I cannot accept that submission: if it were so, it would be permissible for a claimant for privilege to tender the documents the subject of the claim, as evidence in support of the claim, and yet maintain the claim for privilege in them, which is plainly not the case. Moreover, enormous difficulties would be created for the other party and its lawyers in having to “put out of mind” the privileged information which was provided to them supposedly on a limited basis. Avoiding that mischief provides an important part of the rationale for the waiver rule.

31. Nonetheless, it is correct that not every disclosure of a privileged communication will amount to a waiver. Thus in Osland v Secretary, Department of Justice, [18] it was held that whether, in a given context, a limited disclosure of the existence and effect of legal advice was inconsistent with maintaining legal professional privilege depended upon the circumstances of the case, including the nature of the matter in respect of which the advice was received, the purpose of the disclosure and the legal and practical consequences of limited rather than complete disclosure. In that case, legal professional privilege had not been waived in relation to legal advice the existence and broad effect of which had been the subject of a public announcement the purpose of which was to satisfy the public that due process had been followed.

    18. (2008) 234 CLR 275; (2008) 249 ALR 1; (2008) 82 ALJR 1288; [2008] HCA 37 at [35], [45], [46], [49], [131].

32. Osland was concerned with circumstances where only the conclusion in the advice, and not the whole of its contents, were disclosed. In the present case, the whole of the contents of the relevant documents were disclosed. However, they were disclosed, under cover of a claim of confidentiality and privilege, only to persons to whom they had already been (mistakenly) provided, in the context and for the purpose of securing their return.

33. It is well-established that disclosure of a privileged communication to a third party, for a limited and specific purpose, and upon terms that the third party would treat the information disclosed as confidential, does not necessarily result in a loss of the privilege as against a person opposed in litigation. [19] In the present case, the disclosure was not to a third party, but to the very person who was opposed in the litigation. Ordinarily, this would be fatal. However, in this case, the opponent was already (albeit mistakenly) in possession of the documents. The disclosure was under cover of a claim that the documents remained privileged, use of the documents was limited by the implied undertaking, and when the documents were put into evidence a suppression order was sought and made. The critical point is that there was no further disclosure beyond that which had already, albeit mistakenly, taken place. Moreover, it took place in a context in which counsel for the defendant was plainly endeavouring to assist the court by limiting disputation to the real substance of the matter then before the court and eschewing adjectival arguments (such as applying to set aside the notice to produce) which might well legitimately have been available.

    19. Mann v Carnell (1999) 201 CLR 1; 168 ALR 86; [1999] HCA 66 at [30]-[32]; see also Goldberg v Ng (1995) 185 CLR 83; 132 ALR 57; Thomason v Campbelltown Municipal Council (1939) 39 SR(NSW) 347 at 355; British Coal Corp v Dennis Rye Ltd (No 2) [1988] 1 WLR 1113; [1988] 3 All ER 816; Goldman v Hesper [1988] 1 WLR 1238; [1988] 3 All ER 97; Gotha City v Sotheby's [1998] 1 WLR 114.

26. While I recognise considerable force in the argument that production of the documents, and subsequent tender of them, waived privilege in them, I have concluded that in the context of the application then before the court for return of the documents, where they were already in the plaintiffs’ possession, and – critically - where production and tender under protection of a suppression order involved no further disclosure than had already (albeit mistakenly) taken place, waiver should not be imputed to the defendant. This conclusion is also supported by the consideration that any other outcome would defeat the very purpose for which the order for return of the documents was made, namely to restore the status quo ante their mistaken disclosure, consistent with the overriding purpose and the dictates of justice. [20]

    20. Cf Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Limited (2013) 250 CLR 303; (2013) 303 ALR 199; (2013) 88 ALJR 76 at [58].

Privilege - establishment

35. As privilege in the contentious documents was not, in the circumstances, waived by their production and/or tender on 30 October 20916, and has not since been waived, it is necessary to consider whether a claim of privilege, apart from privilege belonging to the HMH Trust, has been made out. As has previously been emphasised,[21] to sustain such a claim in the present context Mrs Rinehart must establish not only that the documents in issue are privileged, but that the privilege is hers personally, and not that of the trustee of the trust. Because the plaintiffs’ primary response was waiver, and because the main issues in relation to privilege had been argued earlier, the parties’ submissions did not address whether the documents were, apart from any question of waiver, privileged.

    21. Hancock v Rinehart (Privilege) [2016] NSWSC 12 at [5]-[6]; Rinehart v Rinehart [2016] NSWCA 58 at [4].

36. The position is complicated by the circumstance that, while Freehills undoubtedly were retained by Mrs Rinehart qua trustee of the HMH Trust, they appear also to have been retained by her in other capacities (and by other Hancock entities). At the foundation of Mrs Rinehart’s claim of privilege is the proposition that, in creating or receiving the documents in issue, Freehills were acting for her other than qua trustee of the HMHT. While there is clear evidence of a retainer by the HMH Trust, the position in respect of other Hancock entities is less clear. The terms of the retainer were “not as clear as they might be”, and it seems that Freehills were acting concurrently for other Hancock entities. However:

1. all the work was done on a single file;

2. as appears from the summary of documents 37, 38, 39, 40 and 41, referred to below, Freehills apparently billed all the work together in one account (although for period from 25 August it was subsequently dissected into three accounts); and

3. instructions were received and advice was rendered through a common conduit, typically Mr Lee, an in-house solicitor at HPPL, and was often given in respect of multiple entities in one communication. On Mrs Rinehart’s own case, some of the documents contain “a mixture of information that related to the HMH Trust and other matters”. [22]

   22. Affidavit of P. Speed of 29 March 2017, [17(c)]; see also [18], [19].

37. In my view, while there are some documents which refer to a particular client entity, Freehills were during the relevant period acting, if not for the HMH Trust alone pursuant to the only retainer that has been identified, then for multiple Hancock entities, including the HMH Trust, jointly.

38. Where solicitors act for multiple parties jointly, there is a waiver of privilege as between those parties by reason of the joint retainer. [23] The holders of a joint privilege have no confidence against each other: if they fall out and sue each other, they cannot claim privilege against each other in respect of communications made during the subsistence of the joint retainer before an actual conflict emerged, although they can maintain privilege against the rest of the world. [24] Thus insofar as the relevant client was, or included, the trustee of the HMH Trust, then privilege is not maintainable against Bianca. Privilege will be maintainable against Bianca as trustee of the HMH Trust only where it is established that Freehills were acting for another Hancock entity, to the exclusion of the HMH Trust, in circumstances where the other entity was entitled to maintain a claim of privilege against the HMH Trust.

    23. TSB Bank plc v Robert Irving & Burns [2000] 2 All ER 826 at 831-4.

    24. Hellenic Mutual War Risks Association (Bermuda) Ltd v Harrison (The "Sagheera") [1997] 1 Lloyd’s Rep 160 at 165-6; Farrow Mortgage Services Pty Ltd (in liq) v Webb (1996) 39 NSWLR 601 at 608; Schreuder v Murray (No 2) (2009) 260 ALR 139; 41 WAR 169; [2009] WASCA 145 at [9]; BBGP Managing General Partner Ltd v Babcock & Brown Global Partners [2011] Ch 296; [2011] 2 All ER 297 at [52].

39. The evidence relied upon to support the claim for privilege is a schedule to Mrs Rinehart’s solicitors’ affidavit of 29 March 2017 (“the March affidavit”), which is to be read in conjunction with the description of the documents in the solicitor October affidavit. I accept that a claim for privilege may be proved by evidence other than that of the creator deposing to his or her purpose, for example by evidence pointing to the nature of the documents, or describing the circumstances in which they were brought into existence. [25] At least in circumstances where Mrs Rinehart was not the creator of the relevant documents, I do not consider that the absence of a first-person affidavit from her as claimant is fatal. But the claimant must expose facts from which the court can make an informed decision as to whether the claim is supportable,[26] and the evidence must reveal the relevant characteristics of each document in respect of which privilege is claimed,[27] and must do so by admissible direct evidence, not hearsay. [28]

    25. Grant v Downs (1976) 135 CLR 674 at 689; see also AWB Ltd v Cole (No 5) [2006] FCA 1234 at [44] (Young J); Hastie Group Limited v Moore [2016] NSWCA 305 at [29]-[32].

    26. National Crime Authority v S (1991) 29 FCR 203 at 211-2; 100 ALR 151 at 159 (Lockhart J).

    27. Lazenby v Zammit [1987] Tas R 54 at 56 (Green CJ and Wright J); see also Attorney-General for the Northern Territory v Kearney (1985) 158 CLR 500 at 508 (Gibbs CJ); Holmes v Deputy Commissioner of Taxation (1987) 19 ATR 1278 at 1286 (Davies J); Hancock v Rinehart (Privilege) [2016] NSWSC 12 at [7].

    28. Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501, 513-4 (Brennan CJ); Hancock v Rinehart (Privilege) [2016] NSWSC 12 at [7].

40. The solicitor’s March affidavit sets out, in respect of each document in issue, a short description of its nature (such as “file note”, “file copy of letter”, or “facsimile”), from whom it originated and to whom it was sent, the basis of the claim asserted (for example, “pursuant to s 118 [or s 119] of the Evidence Act”), and the grounds of the claim (for example, “the document is a confidential communication between client and solicitor for the dominant purpose of providing legal advice to Mrs Rinehart in her capacity as director of HFMF and trustee of the Superannuation Trust”, or “the document is a confidential communication between client and solicitor for the dominant purpose of providing legal advice to Mrs Rinehart (not acting in her capacity as the trustee of the HMH Trust”)). The October affidavit sets out characteristics of the contentious documents. The solicitor was not cross-examined. The following description of the documents is taken from his affidavits, and is arranged more or less chronologically.

41. Document 10 is a file copy of a facsimile dated 25 May 1995 from Freehills to Mr Lee. In the March affidavit, privilege is claimed as “a confidential communication between client and solicitor for the dominant purpose of providing legal advice”. In the October affidavit, it was said that the document makes no reference to the HMH Trust and relates to notices calling for and forfeiting shares. However, the evidence does not reveal for which Hancock entity or entities clients this document was created. There is nothing to indicate that it was created for Mrs Rinehart in a capacity only other than as trustee of the HMH Trust. In circumstances where, as appears from other documents mentioned below, Mr Lee (and HPPL) was a conduit for communications for various Hancock entities with Freehills, no inference that this was exclusively for HPPL’s purposes should be drawn. Accordingly no basis for maintaining a claim of privilege against the trustee is established.

42. Document 14 is described in the October affidavit as a facsimile transmission dated 12 July 1995 from Mr Lee to Freehills, attaching correspondence from Corrs Chambers Westgarth listing the files established and held by them in relation to the Hancock Group of Companies. It is said to make no reference to the HMH Trust, but that does not mean that it is incapable of casting light on the issues – for example, the terms of Freehills’ retainer and the identity of Freehills’ client or clients. Although it is asserted in the March affidavit that the document is a confidential communication between client and solicitor for the dominant purpose of providing legal advice, there is no suggestion that it contains instructions or advice; rather it contains a list of matters in which Corrs were acting (and potentially in which Freehills were to act). The existence (and terms) of a retainer between a client and solicitor are, generally speaking, not privileged. [29] I am not satisfied that document 14 is a privileged communication. Moreover, the evidence does not reveal for which client or clients it was created, and there is nothing to indicate that it was created for Mrs Rinehart only in a capacity other than as trustee of the HMHT. Accordingly no basis for maintaining a claim of privilege against the new trustee is established.

    29. Cook v Pasminco Pty Ltd (No 2) (2000) 107 FCR 44 at 53 [47]; CSR Ltd v Eddy (2008) 70 NSWLR 725; [2008] NSWCA 83 at 728 [7]; 728 [10]; 737 [62]–[63]. Pascoe v Boensch [2007] FMCA 1214 in which it was held that costs disclosure documents were privileged, but in which no reference was made to the above-mentioned authorities, may respectfully be doubted.

43. Document 13 is described in the October affidavit as a file copy letter dated 11 July 1995 from Freehills to Mr Lee which states that it encloses, and summarises in three distinct sections, three draft opinions in connection with (1) Zamoever Pty Ltd and the Hancock Family Memorial Foundation (HFMF), said to be directed to Mrs Rinehart in her capacity as trustee of the HMHT; (2) a proposed share buyback of shares held by HFMF, said to be directed to Mrs Rinehart in her capacity as a director of HFMF; and (3) the HPPL Superannuation Plan, said to be directed to her in her capacity as a trustee of the Superannuation Trust. In the March affidavit, privilege is claimed in respect of the redacted portions (which relate to the subject matter of (2) and (3)) on the basis that it was a confidential communication between solicitor and client for the purpose of providing legal advice to Mrs Rinehart in her capacity as director of HFMF and trustee of the Superannuation Trust. However, the document was a single communication, in respect of all three draft opinions. It communicated the effect of all three advices, without discrimination between the recipients. It was not exclusively a communication to any one of them, and none was entitled to maintain a claim of privilege in respect of it – or its enclosures – against the others. In my judgment, HFMF and the Superannuation Trust are not entitled to maintain a claim of privilege in respect of the redacted parts of the document against the HMH Trust.

44. Document 2 is described in the October affidavit as an internal Freehills file note dated 20 July 1995 which refers to four briefs being prepared, in relation to (a) advice to the directors of Zamoever in relation to a share buyback in HPPL; (b) Zamoever shares and the HMH Trust; (c) possible cause of action against Porteous; and (d) HRL/HML brief re tax treatment. In the March affidavit, it is said to be a confidential document prepared by Mrs Rinehart’s solicitors for the dominant purpose of briefing counsel to provide legal advice to her personally and as a director of Zamoever and HRL/HML. Consistent with the approach adopted by the defendants in relation to, inter alia, documents 13 and 27, this document, at least insofar as it relates to item (b), was created for the trustee of the HMH Trust. It is not established that the document was prepared exclusively for entities other than HMHT, and privilege in it cannot be maintained against the HMHT. Moreover, the defendant has elsewhere accepted that advice in relation to the potential liability of Rose Porteous was a trust document. [30]

    30. See Document 36, and see also PX403, p44ff, and 31/10/16 T23.07.

45. Document 15 is described in the October affidavit as a file copy letter dated 4 August 1995 from Freehills to Mr Lee which states that it encloses three signed advices and a draft opinion. It may be inferred that those advices were:

1. Document 27 (in respect of which a claim of privilege was not maintained) is a Freehills memorandum of advice dated 4 August 1995 entitled “Zamoever Pty Ltd and the Hancock Family Memorial Foundation – Introduction of the Hope Margaret Hancock Trust”, which was said to be in response to a request to advise Mrs Rinehart, the trustee of the HMH Trust;

2. Document 30, being a Freehills memorandum of advice dated 4 August 1995 relating to the proposed buyback by HPPL of shares held by HFMF and said to be in response to a request to advise Mrs Rinehart, a director of both HPPL and HFMF; and

3. Document 35, being a Freehills memorandum of advice dated 4 August 1995 relating to the HPPL Superannuation Plan and said to be in response to a request to advise the trustees of the Superannuation Plan, Mrs Rinehart and Mr Schwab.

46. Had they stood on their own, an argument that Documents 30 and 35 were prepared solely for the purposes respectively of HPPL and HFMF, and of the trustees of the Superannuation Plan, might have been tenable. However, their provision together with Document 27, which was plainly prepared for the purposes of the HMH Trust, under cover of a single letter, being Document 15, is indicative that they were prepared pursuant to a joint retainer, as a result of which HPPL and HFMF, and the trustees of the Superannuation Plan, were and are not entitled to maintain a claim of privilege against the HMH Trust.

47. Documents 32, 33 and 34 are described in the October affidavit as respectively a signed and two draft versions of a Freehills memorandum of advice, signed 3 August 1995, relating to a proposal to admit a new member to HFMF, in response to instructions to advise Mrs Rinehart and Mr Schwab, the directors of Zamoever, in respect of their obligations as directors of that company. If that were the whole of the evidence, an argument that Documents 32, 33 and 34 were prepared solely for the purposes of the directors of Zamoever – to the exclusion of the HMHT – would have been at least tenable. However, the context in which those obligations were relevant has not been indicated. Moreover, the above comments in respect of Document 13(1), 2(b) and 27 indicate that advice about Zamoever was relevant to the HMH Trust. In those circumstances, I am unpersuaded that these documents were prepared other than pursuant to a joint retainer in which the HMH Trust was one of the clients, the consequence of which is that privilege is not maintainable against the HMHT as one of the clients.

48. Document 23 is described in the March affidavit as a confidential communication between client and solicitor for the dominant purpose of providing legal advice to Mrs Rinehart (not acting in her capacity as trustee of the HMH Trust), in relation to a current proceeding. To what “current proceeding” it related is left unstated. Insufficient facts to enable the court to make an informed decision as to whether the claim of privilege is supportable are disclosed. Moreover, in the October affidavit this document was not specifically referred to at all. The disclosure index describes it as “Fax from HPPL to FHP dated 24 October 1995 entitled ‘Zamoever’ attaching a fax from HPPL to Blake Dawson Waldron dated 15 September 1995 entitled ‘Zamoever’ and attaching ‘LGH Share Sale Plan’. Given the apparent interest of the HMH Trust in issues pertaining to Zamoever, it is not established that this document was prepared other than pursuant to a joint retainer, the consequence of which is that privilege is not maintainable against the HMHT as one of the clients.

49. Document 22 is the first page of a file copy of a letter from Freehills to Mr Lee dated 13 September 1995 which refers to enclosing three draft opinions, the inference being that the enclosures are:

1. Document 31, being a draft Freehills memorandum of advice dated 11 September 1995 relating to the enforceability and dutiability of “the Plan of 22 June 1988” between Lang Hancock and Mrs Rinehart, said to be in response to instructions to advise Mrs Rinehart; [31]

2. Document 36 (in respect of which a claim of privilege was not maintained), being an undated draft Freehills memorandum of advice relating to a number of issues in relation to the activities of HPPL, HML and HFMF, said to be in response to instructions to advise Mrs Rinehart in her capacity as trustee of the HMH Trust; [32] and

3. Document 29 (of which Document 28 appears to be an earlier draft) which are described in the October affidavit as unsigned and draft memoranda of advice relating to the estate of LG Hancock, in response to instructions to advise Mrs Rinehart, “in her personal capacity and as trustee of certain trusts”. In the March affidavit these two documents are described as confidential communications between client and solicitor for the dominant purpose of providing legal advice to Mrs Rinehart in her personal capacity.

   31. Notably, advice about the Plan of June 1988 is elsewhere treated as a trust document: see document 13.

   32. Notably, this includes “Porteous’ liability”.

50. The evidence does not illuminate which are the “certain trusts” referred to in connection with Document 29, and there is no evidence to the effect that the HMH Trust was not one of them. I am therefore not satisfied that these two documents are privileged in the hands of Mrs Rinehart (or some other Rinehart entity), only other than in her capacity as trustee of the HMH Trust.

51. Although, had Document 31 stood on its own, an argument that it was prepared solely for the purposes Mrs Rinehart in a capacity other than as trustee of the HMH Trust might have been tenable, its provision together with documents 36 (which was plainly prepared for the purposes of the HMH Trust) and 29 (which is not shown not to have been produced for such purposes), under cover of a single letter, being Document 22, is indicative that they were prepared pursuant to a joint retainer in which the HMH Trust was one of the clients, as a result of which Mrs Rinehart in some other capacity is not entitled to maintain a claim of privilege against the HMH Trust.

52. Documents 24, 25 and 26 are two facsimiles and one letter respectively dated 31 October 1995, 31 October 1995 and 2 November 1995 from David Neill, Group Financial Accountant for HPPL to Freehills, containing analyses relating to the solvency of Lang Hancock, HFMF and HRL, and the estate of Lang Hancock at various times. In the October affidavit it is said that they make no reference to the HMH Trust “otherwise than by way of background in Document No. 24”, nor state that they have been created for the purposes of providing advice to Mr Rinehart in her capacity as trustee of the HMH Trust. In the March affidavit, it is merely asserted that they were for the dominant purpose of providing legal advice to Mrs Rinehart other than in her capacity as trustee of the HMHT. However, it is apparent from what is disclosed about Document 41, referred to below, that the insolvency of the HG Hancock estate was considered on behalf of the HMHT. The evidence does not establish for which Hancock entity these documents were prepared, let alone that they were prepared exclusively for Hancock entities other than the HMH Trust. It is not established that these documents were prepared other than pursuant to a joint retainer, the consequence of which is that privilege is not maintainable against the HMHT as one of the clients.

50. Document 43 is described in the March affidavit as “Bundle of miscellaneous Freehills file notes and Freehills telephone attendance notes”. Mrs Rinehart asserts a claim of privilege under s 118 in respect of the unredacted portions, on the basis that the document is a confidential document prepared by her solicitors for the dominant purpose of providing legal advice to her “in various capacities” – in which capacities is not identified. In the October affidavit it was described as “a bundle of internal Freehills file notes dated from 10 May 1995 to 12 September 1995 which appear to touch upon the matters the subject of the advices referred to above”, being the three advices previously mentioned. I have concluded, above, that a claim of privilege cannot be maintained against the trustee of the HMH Trust in respect of those advices.

51. Moreover, the process by which Document 43 was redacted is described in the solicitor’s March affidavit, as involving his employed solicitor reviewing the contents, looking for any references to the HMH Trust, and redacting those parts which “she considered to be not relating to the HMH Trust”. Where a document contains both privileged and unprivileged communications, a person entitled to the privilege is permitted, as of right, to redact the privileged portions when producing them. However, in performing that exercise, the issue is not one of relevance but of privilege. In this case, that means that the question is not whether the document relates to the HMH Trust, but whether the document is privileged in the hands of Mrs Rinehart, only other than in her capacity as trustee of the trust. That essentially depends on for whom Freehills were acting when the relevant file note was made. If (as I have inferred) Freehills were acting for multiple Hancock entities, including the trustee of the HMH Trust, jointly, then the privilege is that of those entities jointly, and cannot be maintained by one against the other. The exercise that was undertaken to redact document 43 did not reflect those principles. The defendant has not established that the redacted portions of document 43 are privileged in the hands of Mrs Rinehart, only other than in her capacity as trustee of the HMH Trust, or that privilege in them can be maintained against the HMH Trust.

52. Documents 37, 38, 39, 40 and 41 are Freehills letters dated 6 June, 12 July, 2 August, 5 September and 5 December 1995 which enclose memoranda of professional fees and disbursements which are each addressed to Rinehart & Schwab, Hancock Prospecting Pty Ltd and cover the periods 15 May to 22 May, 30 May to 28 June, 29 June to 26 July, 26 July to 23 August, and 25 August to 18 October. Document 41 refers to a consolidated bill in an aggregate amount of $61,505 for the period 25 August to 18 October 1995 which is said to have been re-dissected to reflect three major subject matters: the first being “general works for HPPL involving preliminary consideration of issues in CIV 2121 of 1992”; and the third was “advice in relation to the HRL/HPPL relationship and the tax and stamp duty implication of that relationship”. The second was:

In relation to Rinehart and Schwab, and in particular Mrs Rinehart’s position as a trustee of the Hope Margaret Hancock Trust, ‘in relation to which we have considered issues such as the insolvency of the estate, the ownership of Zamoever shares and the stamp duty issues associated with those issues’;

56. Document 42 is described in the March affidavit as a “Freehills account (attached behind Document 41) dated 20 October 1995 from Freehills to Mrs Rinehart and Mr Schwab, HPPL”. Privilege is asserted on the basis that it is a document which was prepared by a lawyer from which might be inferred the nature of advice sought or given”. In the October affidavit, Document 42 was described as not apparently including fees referable to the first and third matters. It is to be inferred that Document 42 is the dissected bill relating to the second matter. On the face of the description of Document 41, that matter relates to “in particular Mrs Rinehart’s position as a trustee of the Hope Margaret Hancock Trust”. The evidence thus points to Document 42 being the fees chargeable to, in part if not in whole, the HMH Trust. I am not satisfied that it is privileged in the hands of Mrs Rinehart or some other Rinehart entity, only other than in her capacity as trustee of the HMH Trust.

57. The earlier fee notes apparently relate to work done for all entities – including though not limited to the HMH Trust. It would seem, from what is disclosed about Document 41, that they include – though they are not limited to – work done for the HMHT. It has not been established that these documents were prepared for Mrs Rinehart (or some other entity) exclusively other than as trustee of the HMH Trust.

58. It follows that in my judgment Mrs Rinehart, and HPPL, are unable to sustain a claim of privilege, as against Bianca, in respect of any of the documents in issue.

Conclusion

59. My conclusions may be summarised as follows:

60. It has not previously been determined that the documents in issue are not trust documents; let alone that there is no legitimate forensic purpose in seeking their production in connection with the 3 September 2015 motion; nor does the Freehills subpoena involve a collateral attack on the decision of 31 October 2016 nor otherwise constitute an abuse of process.

61. Mrs Rinehart’s privilege if any in the documents in issue was not waived when she produced them, rather than claiming privilege from production, on 31 October 2016, or when she tendered them later that day: because in the context of the application then before the court for return of the documents, where they were already in the plaintiffs’ possession, and – critically – where production and tender under protection of a suppression order involved no further disclosure than had already (albeit mistakenly) taken place, such production and tender under cover of a non-disclosure order was not inconsistent with maintaining privilege. This conclusion is also supported by the consideration that any other outcome would defeat the very purpose for which the order for return of the documents was made, namely to restore the status quo ante their mistaken disclosure, consistent with the overriding purpose and the dictates of justice.

62. However, Mrs Rinehart, and HPPL, are unable to sustain a claim of privilege, as against Bianca, in respect of any of the documents in issue, because the evidence does not establish that any of those documents was prepared exclusively for an entity other than the HMH Trust, as distinct from pursuant to a joint retainer, the consequence of which is that privilege is not maintainable against the HMH Trust as one of the clients.

63. If given access to the documents, the plaintiffs sought an opportunity to reopen the case, tender the documents (and also the affidavit of Mr Speed of 29 March, in order to support an argument that the redaction process had miscarried), and to make submissions on those matters, for which purpose they were content to proceed on written submissions without a further hearing, within a week or so.

64. It is high time that the 3 September 2015 motion proceed to resolution, and that opportunities to adduce further evidence on it be foreclosed; its history has been set out above. The request to Freehills which resulted in the initial production of the Freehills documents was not made until 9 August 2016. However, on 31 October 2016 the plaintiffs were granted leave to re-open to adduce those of the Freehills documents which were not then required to be returned. As has been explained, the order for the return of the other documents was made on the basis that there would be a review of the production, informed by any objection by Mrs Rinehart. The subpoena now in issue was a result of that process, having been issued in an endeavour to resolve the impasse in which Freehills were not willing prepared to release any further documents while the parties were in dispute. It would be inconsistent with the intent of what was done on 31 October 2016 to deny the plaintiffs the opportunity to tender material so procured on the 3 September 2015 motion.

65. The court therefore orders that:

1. The first defendant’s motion filed 31 January 2017 be dismissed with costs.

2. There be general access to the documents produced by Freehills pursuant to the subpoena of 2 December 2016.

3. The plaintiffs have leave to reopen the evidence on the 3 September 2015 motion and for that purpose lodge with my associate by 11 May 2017 a folder containing:

1. an index;

2. copies of the documents so tendered; and

3. any submissions they wish to make in respect of the tender, and the documents if admitted.

4. The defendants lodge with my associate by 18 May 2017 a folder containing:

1. an index;

2. any evidence in reply to the additional evidence;

3. any objections and submissions they wish to make in respect of the tender, and the documents if admitted; and

4. a statement whether they oppose the question of the admission of any documents so tendered, and any submissions made in respect of them if admitted, being dealt with on the papers without any further oral hearing.

5. The plaintiffs lodge with my associate by 25 May 2017 any evidence and submissions in reply.

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Endnotes

Decision last updated: 04 May 2017