Heckler and Koch GmbH v Faxtech Pty Ltd

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT

S CI 2012 6005

BETWEEN:
HECKLER & KOCH GMBH	Plaintiff
v
FAXTECH PTY LTD trading as POINT TRADING	Defendant
AND BETWEEN:
FAXTECH PTY LTD trading as POINT TRADING	Plaintiff by Counterclaim
- and -
HECKLER & KOCH GMBH	First defendant by Counterclaim
- and -
THE COMMONWEALTH OF AUSTRALIA	Second defendant by Counterclaim

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JUDGE:	Derham AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	15 & 16 February, 22 & 26 March 28 April and 26 May 2016
DATE OF JUDGMENT:	22 November 2016
CASE MAY BE CITED AS:	Heckler & Koch GmbH v Faxtech Pty Ltd
MEDIUM NEUTRAL CITATION:	[2016] VSC 697

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PRACTICE AND PROCEDURE – Discovery and Inspection of discovered documents – Objection to inspection on grounds of client legal privilege and public interest immunity – Whether earlier determination of client legal privilege in the context of the subpoena of documents is a bar to further application to inspect the documents – Not a bar to further determination – Tenth Vandy Pty Ltd v Natwest Markets Australia Pty Ltd [2006] VSC 170; Strategic Management Australia AFL Pty Ltd v Precision Sports & Entertainment Group Pty Ltd [2015] VSC 717.

PUBLIC INTEREST IMMUNITY – Applicable principles – Whether document subject to immunity from production – Evidence Act 2008 (Vic), s 130.

CLIENT LEGAL PRIVILEGE – Whether Australian Government Solicitor’s Report created for dominant purpose of giving legal advice and privileged – Document not produced for that dominant purpose and not privileged – Document may be redacted as it contains legal advice and may refer to material the subject of PII – s 118 Evidence Act 2008 (Vic).

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff/Defendant by counterclaim	Ms S Marks QC with Mr S Rubenstein	Logie-Smith Lanyon
For the Defendant/Plaintiff by counterclaim	Dr A. Trichardt	Charles Fice Solicitors
For the Second Defendant by counterclaim	Mr R Knowles	Moray & Agnew

TABLE OF CONTENTS

Introduction......................................................................................................................................... 1

Summary of Conclusions................................................................................................................. 2

AGS Reports................................................................................................................................... 2
Source Evaluation Report............................................................................................................ 3

The Nature of the Proceeding.......................................................................................................... 3

Interlocutory History......................................................................................................................... 8

Affidavits........................................................................................................................................... 14

Applicable Law................................................................................................................................. 14

Public Interest Immunity........................................................................................................... 14
Client Legal Privilege................................................................................................................. 19

Point Trading’s Submissions......................................................................................................... 20

Commonwealth’s Submissions..................................................................................................... 24

Commonwealth Submissions regarding the SER.................................................................. 24
Commonwealth Submissions regarding the AGS Report.................................................... 26

Consideration.................................................................................................................................... 26

The AGS Report........................................................................................................................... 26
The Unredacted AGS Report – document 1 in the Privilege Table........................... 26

The Redacted AGS Report – document 3 in the Privilege Table......................................... 30
Conclusion................................................................................................................................... 30
The SER......................................................................................................................................... 31

Conclusion......................................................................................................................................... 36

HIS HONOUR:

Introduction

The defendant (‘Point Trading’) applied by summons dated 4 December 2015[1] requiring the second defendant by counterclaim (‘the Commonwealth’) to produce for inspection two documents.[2] First, a report by the Australian Government Solicitor to the Department of Defence in two forms, unredacted dated 10 June 2011 (‘unredacted AGS Report’) and redacted dated 12 September 2011 (‘redacted AGS Report’)[3]. The AGS Report is the subject of a claim for client legal privilege and without prejudice privilege. Second, a document called ‘Project Land 40-2 – Direct Fire Support Weapons – Source Evaluation Report - Light Weight Automatic Grenade Launcher’ (‘the Source Evaluation Report’ or ‘SER’), the subject of a claim of public interest immunity (‘PII’).
[1]As amended.
[2]The Summons included application for a wider range of matters that are not presently relevant.
[3]The full title of the Report is ‘Report on Land 40-2 Light Weight Automatic Grenade Launcher Procurement Process, 12 September 2011’ addressed to Mr Harry Dunstall, A/g Deputy CEO, Defence Materiel Organisation. It is signed by Linda Richardson, National Group Leader, Commercial, Australian Government Solicitor. It is marked ‘Commercial in Confidence’.

These documents have been the subject of application before, in the context of objections to the inspection of documents produced pursuant to subpoena. The unredacted AGS Report was found to be subject to client legal privilege. There was a call for inspection of the redacted AGS Report and the Source Evaluation Report that was withdrawn and, so far as those documents were concerned, the subpoena was set aside. That occurred at a time when the Commonwealth was not a party to the proceeding, as it now is, and when the factual underpinning for the claim that the SER was subject to PII was different from that now applicable, and the material relating to the claim for privilege over the redacted and unredacted AGS Report was more limited.

The redacted AGS Report had been provided by the Commonwealth to Point Trading subject to a confidentiality undertaking and on what the Commonwealth contends was a without prejudice basis in the course of an ongoing attempt by Point Trading to conclude a claim for compensation from the Defence Materiel Organisation (‘DMO’) of the Commonwealth for substantial tendering costs incurred.[4] On 28 November 2014, I ordered after argument and inspection of the unredacted AGS Report, that it was subject to privilege and upheld the Commonwealth’s objection to Point Trading inspecting it.
[4]Elliott Affidavit 23 February 2015 at [3].

Despite the fact that by order made on 28 November 2014 it was determined that the unredacted AGS Report was the subject of privilege and that there was no appeal from that decision, Point Trading sought again to challenge the claim to privilege in respect of it and the redacted AGS Report. Point Trading sought to rely on the inherent jurisdiction of the Court to control its procedure to re-agitate that question where there is further evidence and changed circumstances. The challenge to the client legal privilege claimed in relation to the redacted AGS Report included that there had been a waiver of the privilege.

Summary of Conclusions
AGS Reports

I have concluded for the reasons set out below that:

(a) it is appropriate to reconsider the interlocutory decision made that the unredacted AGS Report is subject to client legal privilege;

(b) the unredacted AGS Report is not a document created for the dominant purpose of giving legal advice to the Commonwealth and is not the subject of client legal privilege, although parts of it may be appropriately redacted as they contain advice or may refer to material the subject of PII;

(c) the redacted AGS Reports, although slightly different from the unredacted AGS Report and bearing a different date, is of the same character as the unredacted report and is also not subject of client legal privilege; and

(d) it is therefore unnecessary to consider whether the redacted reports were given subject to without prejudice privilege and in a way that might preserve their status as privileged.

Source Evaluation Report

After examining the SER, I am satisfied that it contains no information relevant to the issues raised by Point Trading in its counterclaim. I am also satisfied from the evidence advanced by the Commonwealth that it is properly the subject of PII. Accordingly, Point Trading is not permitted to inspect the SER.

The Nature of the Proceeding

Heckler & Koch GmbH (‘HK’) is involved in the design, manufacture, sale and supply of military weapon systems. The proceeding was commenced by HK to recover from Point Trading a 40mm grenade machine gun (‘GMG’), also known as a light weight automatic grenade launcher (‘LWAGL’).

On 9 July 2007, the Department of Defence of the Commonwealth issued a request for tenders (‘2007 RFT’) for the supply maintenance and support of a LWAGL identified as ‘RFT LWAGL 1/2007’.[5] This tender was a part of a tender for the supply of a land based weapon system known as Land 40 – phase two (‘the Land 40 - 2 Tender’). Before the issue of the 2007 RFT, and in anticipation of its issue, Point Trading, HK and a Norwegian company called Vinghøg AS (‘Vinghøg’) entered into a ‘Deed of Confidentiality and Disclosure of Relevant Activities Land 40-2 Project’ (‘Deed’). On or about 10 September 2007, Point Trading and HK entered into a Framework and Tendering Agreement (‘FTA’) under which Point Trading, as prime contractor and HK, Vinghøg and others, as sub-contractors, agreed to participate in connection with Point Trading’s Tender.
[5]Point Trading’s Counterclaim against the Commonwealth filed 21 September 2015 at [9].

HK claims it loaned the GMG to Point Trading to enable it to use it in the tender process. Point Trading agrees it received the weapon but says that pursuant to the 2007 FTA, in the events that have happened, it is not obliged to return it to HK and counterclaims damages from HK for breach of the FTA and the Deed. In addition, since joinder of the Commonwealth in September 2015, Point Trading makes claims against it by counterclaim.

In October 2007, Point Trading prepared and submitted a response to the Commonwealth request for tender for the GMG which proposed the supply of the GMG manufactured by HK, a Vingmate fire control system manufactured by Vinghøg and a thermal sight system (‘the proposed LWAGL’). Point Trading claims that this response complied with the RFT and did not involve any obligation on Point Trading to supply ammunition or ballistics tables for use in the fire control system.[6]
[6]Counterclaim against the Commonwealth 21 September 2015 at [18]-[20].

Between November 2007 and July 2009, Point Trading and the Commonwealth participated in a process of technical testing and negotiations in relation to the proposed LWAGL, during which:[7]

(a) Point Trading did not offer and the Commonwealth did not request, the supply of ammunition and associated ballistics tables for the proposed LWAGL; and

(b) the Commonwealth and the Point Trading’s sub-contractors had direct dealings and communications in respect of Point Trading’s tender response to the 2007 RFT, the RFT process and Land 40-2 Project in breach of its alleged tender process obligations (‘Tender Process Obligations’).

[7]Counterclaim against the Commonwealth 21 September 2015 at [21]-[23].

The Tender Process Obligations as alleged by Point Trading involve obligations:

(a) to conduct the tender process in accordance with the 2007 RFT;

(b) restricting the Commonwealth’s ability to deal with persons other than the tenderers before the preferred tenderer was selected;

(c) Restricting the Commonwealth’s ability to deal with any other person after Point Trading was selected as preferred tenderer; and

(d) on the Commonwealth to conduct the contract negotiations fairly and honestly.[8]

[8]Counterclaim against the Commonwealth 21 September 2015 at [13].

In July 2009, Point Trading was selected by the Commonwealth as the preferred tenderer and was invited to participate in negotiations with a view to entering into contracts to supply the proposed LWAGL to the Commonwealth.[9]
[9]Counterclaim against the Commonwealth 21 September 2015 at [24].

There then ensued a contract discussion period during which the Commonwealth dealt with Point Trading as preferred tenderer, but in breach of the Tender Process Obligations, had direct dealings and communications with Point Trading’s sub-contractors without Point Trading’s knowledge, delayed the commencement of the formal contract discussions and negotiated with Point Trading on a basis different from the 2007 RFT and Point Trading’s response to it.[10]
[10]Counterclaim against the Commonwealth 21 September 2015 at [26]-[27].

Between February 2010 and February 2011, Point Trading and the Commonwealth participated in formal contract negotiations, engineering workshops and testing.[11] During that process and in breach of the Tender Process Obligations, the Commonwealth had direct dealings and communications with Point Trading’s sub-contractors without Point Trading’s knowledge. Also during that period:[12]
[11]Counterclaim against the Commonwealth 21 September 2015 at [28].
[12]Counterclaim against the Commonwealth 21 September 2015 at [31]-[32].

(a) the volume of LWAGLs to be supplied changed and the Commonwealth and Point Trading negotiated on the basis of that change;

(a) the Commonwealth imposed further requirements on Point Trading in addition to those the subject of the 2007 RFT, including that Point Trading must supply ammunition and associated Ballistic tables for Acceptance Testing and Evaluation (‘AT & E’); and

(b) the Commonwealth failed to discuss its own issues in breach of the Tender Process Obligations.[13]

[13]Counterclaim against the Commonwealth 21 September 2015 at [33].

On or about 28 February 2011, the Commonwealth ended this tender process and informed Point Trading by letter that it would not consider Point Trading’s tender any further. The reasons stated in the letter, in summary, related to:[14]
[14]Elliott Affidavit of 3 December 2014 at [61].

(a) inability to resolve a disagreement about the responsibility for the supply of the ammunition required for AT & E and the ballistics table which relates to that ammunition;

(b) unresolved disagreement about costs for tests and demonstrations of the LWAGL that included live firing; and

(c) knowledge that the tenderer would not now supply a weapons system with all necessary stores including ammunition and associated ballistic tables in the Fire Control System.

Point Trading counterclaims against the Commonwealth that it had no valid reason for terminating the formal contract negotiations, and alternatively, that the real reasons for terminating the contact negotiations had to do with direct communications between the Commonwealth and HK and the other subcontractors under, and in breach of, the Deed and the FTA and the Commonwealth’s failure to change the tender specifications to require Point Trading to supply ammunition and ballistics tables, and other matters.[15]
[15]Counterclaim against the Commonwealth 21 September 2015 at [34]-[39].

Point Trading also claims an estoppel by convention arising from a common understanding and assumption regarding the Commonwealth stipulating and supplying its own ammunition and ballistics tables and not requiring Point Trading to do so, and otherwise conducting the contract negotiations within the parameters of the 2007 RFT and in accordance with the Tender Process Obligations. Point Trading relied on the common understanding and assumption to its detriment. The result of the Commonwealth’s conduct in terminating the contract negotiations in contravention of the common understanding and assumption is that Point Trading lost the opportunity to enter into formal contracts to supply the LWAGLs and thereby suffered loss and damage.[16]
[16]Counterclaim against the Commonwealth 21 September 2015 at [40]-[49].

Point Trading also claims:

(a) breach of a duty of care. The duty is, in summary, to conduct contract discussions and negotiations within the context and parameters of the 2007 RFT, in accordance with the Commonwealth Tender Process Obligations and not to change the requirements or specifications in the 2007 RFT, except in accordance with the procedure set out in it;[17]

(b) negligent misrepresentation regarding the supply of ammunition and ballistics tables, not dealing with Point Trading’s subcontractors, the testing of the LWAGL and that Point Trading’s response to the 2007 RFT conformed with it;[18] and

(c) that the Commonwealth induced breaches of the FTA.[19]

[17]Counterclaim against the Commonwealth 21 September 2015 at [50]-[53].

[18]Counterclaim against the Commonwealth 21 September 2015 at [54]-[59].

[19]Counterclaim against the Commonwealth 21 September 2015 at [60]-[66].

In its defence to counterclaim, broadly speaking, the Commonwealth does not admit or denies the various allegations referred to above and, specifically, alleges that it told Point Trading in its termination letter of 28 February 2011 that it does not agree with Point Trading that the Commonwealth is responsible for the supply of ammunition and ballistics tables required for the AT&E.[20]
[20]Commonwealth Defence to Counterclaim 26 October 2015, at [35].

In 2013, the Department of Defence issued another request for tender in respect of a LWAGL weapon system (‘2013 RFT’). Point Trading did not lodge a tender.

On 27 August 2015, the then Minister for Defence announced that Nioa Pty Ltd (‘Nioa’) was the successful tenderer, pursuant to the 2013 RFT, to supply and support the provision of the LWAGL for the Australian Defence Force (‘ADF’).

Interlocutory History

On 29 October 2013, orders were made on an application by Point Trading pursuant to r 32.07 of the Supreme Court (General Civil Procedure) Rules 2005[21] (‘the Rules’) for discovery of documents from the Commonwealth.[22] At that time, the Commonwealth was not a party to the proceeding, as it now is. The documents sought to be discovered were described by category in an attachment to the application. On the day of the making of the order, counsel for Point Trading and the Commonwealth engaged in discussions to refine the descriptions of categories of documents of which discovery was sought by Point Trading. Agreement was reached as to the descriptions and a regime for commercially sensitive documents to be kept confidential.
[21]As those rules then were.
[22]The application was made by summons filed on 27 September 2013 supported by the affidavit of Richard Alan Mereine, of HWL Ebsworth Lawyers, the then solicitors for Point Trading. The Summons also included applications made for discovery by HK Systems Australia Pty Ltd and Vingtech Australia Pty Ltd. These were other applications were adjourned.

By paragraph 1 of the order made on 29 October 2013, the Commonwealth was ordered to give non-party discovery of categories of documents set out in an annexure to the order. The orders made included:

Subject to further order, inspection of the documents discovered by the Commonwealth of Australia pursuant to paragraph 1 of this order is restricted to the external legal representatives and in-house legal counsel of the parties, and only after the provision to the Commonwealth of a signed confidentiality undertaking in a form to be agreed by the Commonwealth.

In other matters it was recorded:

No finding has been made as to the claimed confidentiality of the documents to be discovered by the Commonwealth of Australia pursuant to this order. In the event that a party seeks to be relieved of a confidentiality undertaking given pursuant to this order, the person seeking the benefit of the claimed confidentiality of the document or documents will have the onus of establishing that confidentiality and the grounds for any restriction as to the inspection of documents discovered by the Commonwealth.

The confidentiality regime established by the order was ‘prophylactic’, as counsel for the Commonwealth later described it, because at the time it was not known with certainty what would fall within the several categories of documents ordered to be discovered by the Commonwealth.[23]
[23]Transcript, 15 February 2016, p 54TW.

The documents discovered pursuant to the orders made on 29 October 2013 were relevantly described in Part 1 of Schedule 1 to the affidavit of documents of Mr Malcolm McKeith dated 11 December 2013 and Part 1 of Schedule 1 to the supplementary affidavit of documents of Mr McKeith dated 22 January 2014.

On 14 August 2014, the Court issued, at the defendant’s request, a subpoena requiring the Commonwealth to produce certain documents (’the subpoena’). A variety of documents were produced by the Commonwealth in response to the subpoena and the Commonwealth objected to production of the documents for inspection by Point Trading (or HK) on the basis of client legal privilege and PII. The objections raised by the Commonwealth occupied two days of evidence, argument and submissions. However, not all the matters in dispute were finally determined. Those matters that were dealt with are the subject of orders made on 28 November 2014.

In ‘other matters’ in the orders of 28 November 2014, the documents the subject of objection by the Commonwealth were described by reference to descriptions given in the affidavit of Mr Bryan Andrew Elliott sworn 27 November 2014.[24] The documents were:
[24]See paragraph [20].

(a) a folder containing 52 unredacted documents;[25]
[25]Defined in the order as the ‘unredacted documents’.

(b) a folder containing 26 redacted documents;[26]
[26]Defined in the order as the ‘redacted documents’.

(c) two folders containing 15 documents containing or relating to submissions made to the Minister for Defence and the Minister for Defence Materiel, with attachments;[27]

(d) a folder containing four documents over which there was a claim for client legal privilege together with a table setting out a description of the documents and the basis of the claim for privilege;[28] and

(e) a folder containing the Source Evaluation Report.[29]

[27]Defined in the order as the ‘Ministerial submission documents’.

[28]Defined in the order as the ‘privilege table’.

[29]Defined in the order as the ‘source evaluation report’.

Paragraph 1 of the orders made on 28 November 2014 provided, subject to further order, that inspection of the subpoenaed documents is restricted to the parties’ external legal representatives and in-house legal counsel, and only after the provision to the Commonwealth of a signed confidentiality undertaking.[30] This continued the confidentiality regime established by the order of 29 October 2013.
[30]The form of the undertaking was required to be substantially similar to that previously agreed between the Commonwealth and the respective parties in respect of the documents produced by the Commonwealth pursuant to the order of the Court made 29 October 2013.

It was then ordered that subject to the confidentiality order, the Commonwealth was to give to the parties a copy of the unredacted and redacted documents and two of the documents in the privilege table over which I had declined to accept the claim for privilege. I upheld the claim to privilege in the first document in the privilege table, being the unredacted AGS Report. I did so on the basis of an inspection of the document and without focused affidavit material supporting the contention that it was created for the dominant purpose of giving legal advice, without objection from Point Trading, pursuant to s 7, 8 and 9 of the Civil Procedure Act 2010 (Vic). That is, in the efficient conduct of the business of the Court and the efficient use of judicial resources.[31]
[31]See Transcript, 26 November 2014, p 136. There was reference to the fact of the AGS Report was legal advice to the DMO in the Elliott Affidavit of 27 November 2014 at [42].

The question of privilege in respect of document 3 in the privilege table, being a redacted version of the AGS Report, was adjourned. I ordered the Commonwealth to file any further affidavits in support of its objection to produce the SER by 3 December 2014 and adjourned the further hearing to 5 December 2014.[32]
[32]Other orders not presently relevant were also made.

The further hearing could not proceed on 5 December 2014 as Point Trading’s solicitors sought, and were granted, leave to cease to act. The matter was adjourned to 13 February 2015, when it was again adjourned due to delays in Point Trading obtaining documents from its former solicitors and the late briefing of counsel.

The matter came on again on 24 February 2015, at which time counsel for Point Trading informed the Court that it was not pressing its claim for production and inspection of document 3 of the privilege table (the redacted AGS Report) or the SER, and withdrew the subpoena insofar as it related to those documents. The Court has therefore not adjudicated on whether the redacted AGS Report was privileged or whether the Source Evaluation Report is subject to PII. I recorded in other matters in the orders made that day that:

The defendant has sought to reserve its position in relation to its right, in the future, to seek production, or discovery, and inspection of document 3 of the privilege table and the source evaluation report the subject of Questions 1 and 2. In setting aside the Subpoena by order 2 (below), the Court has not adjudicated on whether the defendant is able to preserve that right or is precluded from doing so by not pressing for production for inspection of those documents and not opposing the setting aside of the Subpoena, subject to the prior orders referred to. In this regard, however, the parties should note the effect of the operation of the Civil Procedure Act 2010 and the comments made by the Court at pages 299–300 of the transcript of argument on 24 February 2015 with regard to the possibility of the defendant issuing a further subpoena for production of the documents the subject of Questions 1 and 2.

The reference in the quoted passage to the comments by the Court in the transcript of the hearing was a reference to my observation that there would need to be a very sound reason for a subpoena to issue for the production of the SER or the redacted AGS Report given that Point Trading had stated it was not pressing its claim for production and inspection of those documents pursuant to the subpoena issued on 14 August 2014.

On 3 September 2015, Almond J granted leave to Point Trading to amend its defence and counterclaim and to join the Commonwealth as a second defendant to it, and directions were made for the filing and service of further pleadings.

By order made by Almond J on 19 October 2015, on the application of the Commonwealth,[33] the Court imposed restrictions on the inspection of various affidavits filed and the discovered and subpoenaed documents and required that where in the future if a party files a documents containing a reference to any of the ‘Confidential Material’[34] which has not been redacted, the document be placed in a sealed envelope marked confidential – not to be disclosed to anyone other than the Court and, if and only if a party’s external legal representative or in-house counsel has provided to the Commonwealth a signed confidentiality undertaking in a particular form, to that person.
[33]By summons filed on 14 October 2015.
[34]Within the meaning of that term as it was defined in the Court’s order of 3 September 2015.

By its summons filed on 4 December 2015, Point Trading applied to the Court for, among other things, orders:

(a) relieving its legal representatives of the confidentiality undertakings given pursuant to paragraph 2 of the Court’s order dated 29 October 2013 and paragraph 1 of the Court’s order dated 28 November 2014;

(b) otherwise altering restrictions on inspection of the discovered and subpoenaed documents provided by the Commonwealth to the parties; and

(c) in particular, it sought to re-agitate the question of whether the unredacted AGS Report and the redacted AGS Report are privileged and the SER is subject to PII, so as to require their production for inspection.[35]

[35]In the summons only the redacted AGS Report was the subject of application. In the course of submissions and argument the application expanded to include the unredacted AGS Report, as the questions are inherently linked.

On 7 December 2015, Point Trading filed a summons by which it applied for an order to alter restrictions on inspection of the discovered and subpoenaed documents provided by the Commonwealth to the parties so as to allow Mr Stephen Michael Quinn to execute and provide to the Commonwealth a form of confidentiality undertaking. On 10 December 2015, this application was refused by the Court.

Almost all of the matters the subject of Point Trading’s summons filed on 4 December 2015 were dealt with by orders on 11 March 2016, 28 April (authenticated on 2 May 2016) and 26 May 2016. It was specifically recorded in other matters, in the order of 11 March 2016, however, that ‘some matters the subject of the defendant’s summons filed on 4 December 2015 remain to be determined by the Court. Those matters include the documents the subject of proposed order 5 of the summons.’[36] Paragraph 5 of the summons sought the production for inspection by the Commonwealth of the redacted AGS Report and the SER, and copies of the confidential affidavits of Mr Elliott dated 27 November 2014, 3 December 2014 and 23 February 2015. The determination of the question whether the unredacted affidavits of Mr Elliott should be able to be inspected, (redacted versions having been served) was agreed between the parties to turn on whether the SER is immune from production for inspection on the ground of PII, as the redacted parts of those affidavits delved into the content of the SER so as to support the claimed immunity.[37]
[36]Paragraph O in ‘Other Matters’ in the order of 11 March 2016.
[37]Transcript 16 February 2016, p 120.

Since the confidentiality regime was put in place by the orders of 29 October 2013 and 28 November 2014, the Commonwealth has been added as the second defendant by counterclaim and Point Trading has filed and served its further amended defence and counterclaim dated 21 September 2015 against HK and its counterclaim dated 21 September 2015 against the Commonwealth. Both HK and the Commonwealth have filed and served their responsive pleadings.

Further, the Commonwealth has entered into an agreement with Nioa for the supply and provision of support of more than 200 LWAGLs to the ADF.[38] This agreement was pursuant to a new and independent Request for Tender (‘2013 RFT’).[39] Point Trading did not participate in the 2013 RFT and that RFT differs from the RFT to which Point Trading responded in 2008.[40]
[38]Elliott Affidavit 22 December 2015, [3] and exhibit BAE-6.
[39]Mews’ Affidavit, [39].
[40]Affidavit of Avner Klein sworn 18 January 2016, [18]. Objection was taken by the Commonwealth to the admissibility of parts of this affidavit. Having regard to my conclusions relating to the SER, it is not necessary to determine the objections.

Affidavits

Point Trading relied on the affidavits of Ms Lyndal Gaye Mews dated 9 December 2015 (‘Mews’ Affidavit’), Mr Avner Klein dated 18 January 2016 (incorporating his affidavit dated 27 November 2014) (‘Klein’s Affidavit’), Mr Quinn dated 18 January 2016 (‘Quinn’s Affidavit’) and Ms Jane Angela Driscoll dated 25 January 2016 (‘Driscoll’s Affidavit’).

The Commonwealth relied upon the affidavits of Mr Elliott sworn 27 November 2014 (‘Elliott Affidavit of 22 November 2014’), 3 December 2014 (‘Elliott Affidavit of 3 December 2014’), 23 February 2015 (‘Elliott Affidavit of 23 February 2015’), 8 December 2015 (‘Elliott Affidavit of 8 December 2015’), 10 December 2015 (‘Elliott Affidavit of 10 December 2015’) and 22 December 2015 (‘Elliott Affidavit of 22 December 2015’), the affidavit of Brigadier Simon Welsh sworn 22 December 2015 (‘Welsh Affidavit’) and Lieutenant Colonel Richard Mollman sworn 24 November 2014 (‘Mollman Affidavit’).

It is not necessary or sensible to undertake a complete review of the affidavits for the purposes of these reasons. I set out in the Annexure to these reasons extracts from the Elliott Affidavits of 3 December 2014 and 22 December 2015 that show the basis of the claim to PII in the SER in general terms. I refer to other aspects of the affidavits of both Point Trading and the Commonwealth in the course of recording the parties’ submissions and in my consideration of the questions for decision.

Applicable Law
Public Interest Immunity

The Commonwealth’s objection to the SER being produced for inspection depends on the application of s 130 of the Evidence Act 2008 (Vic) (‘the Act’), which is applicable to a call for production by virtue of s 131A of that Act.

Section 130(1) provides:

If the public interest in admitting into evidence information or a document that relates to matters of state is outweighed by the public interest in preserving secrecy or confidentiality in relation to the information or document, the court may direct that the information or document not be adduced as evidence.

In deciding whether to give such a direction, the Court may inform itself in any way it thinks fit.[41] That includes by inspecting the document.[42]
[41]Section 130(3) of the Act.
[42]Section 133 of the Act enables the Court to inspect the produced documents to determine if a claim of public interest immunity is justified.

Section 130(4) of the Act sets out a non-exclusive list of circumstances in which the information or document will be taken to relate to ‘matters of state’ for the purposes of s 130(1), including (relevantly) sub-section 130(4)(a) and (f), which states that information or a document will be taken to relate to matters of state where adducing the evidence would:

(a) prejudice the security, defence or international relations of Australia;[43] and

(b) prejudice the proper functioning of the government of the Commonwealth or a State.[44]

[43]Section 130(4)(a).

[44]Section 130(4)(f).

Section 130(5) of the Act sets out a non-exhaustive list of the matters that the Court may take into account for the purposes of s 130(1), as follows:

(a) the importance of the information or the document in the proceeding;
(b) …
(c)the nature of the offence, cause of action or defence to which the information or document relates, and the nature of the subject matter of the proceeding;
(d)the likely effect of adducing evidence of the information or document, and the means available to limit its publication;
(e)whether the substance of the information or document has already been published; …

It is clear from s 130(5) of the Act that the matters set out there do not limit the matters the Court may take into account for the purposes of s 130(1). As Dixon J noted in Murdesk Investments Pty Ltd v The Secretary to the Department of Business & Innovation,[45] other relevant considerations in balancing competing interests of state can be drawn from the cases decided under the common law doctrine, as follows, namely, whether:[46]
[45][2011] VSC 436 [23] (‘Murdesk’).
[46]Stephen Odgers, Uniform Evidence Law in Victoria (Law Book Co, 9^th ed, 2010) [1.3.13580].

(a) the objection to disclosure is a class claim or a content claim;

(b) a representative of government has supported non-disclosure of the information or document;

(c) the information or document relates to Cabinet deliberations or lower levels of government;

(d) the information or document has contemporary importance or is only of historical interest; and

(e) the information or document was acquired on the basis that it would be kept confidential.

There are many authorities on the matters described as ‘matters of state’ that are not directly relevant, particularly those concerning Cabinet documents (documents produced for submission to Cabinet). Some authorities, however, concern documents produced for the proper working of government, where ministers and other senior public servants need to be able to engage in policy development and decision-making on the basis that their deliberations are kept confidential. These authorities are pertinent, and establish some principles relevant to the present matter, as follows:

(a) the content and operation of s 130 of the Act is informed by the common law;[47]
[47]Eastman v The Queen (1997) 76 FCR 9, 63 (von Doussa, O’Loughlin and Cooper JJ); Tatts Group Limited v State of Victoria [2013] VSC 301 (‘Tatts Group’) at [26]; Ryan v State of Victoria [2015] VSCA 353 (‘Ryan’) at [32] and [52].

(b) the common law recognises a rough, but acceptable division of PII claims into ‘class’ and ‘contents’ claims;[48]
[48]Commonwealth v Northern Land Council (1993) 176 CLR 604, 616 (Mason CJ, Brennan, Deane, Dawson, Gaudron, McHugh JJ) (‘Northern Land Council’); Tatts Group at [26].

(c) documents can be immune from disclosure on the basis of their class because their disclosure would injure the public interest, irrespective of the actual contents of the documents;[49]
[49]Sankey v Whitlam & Ors (1978) 142 CLR 1 (‘Sankey’) at 43 (Gibbs ACJ); Tatts Group at [26].

(d) documents that do not belong to such a class may still be immune from disclosure, on the basis that their contents, if disclosed, would injure the public interest;[50]
[50]Northern Land Council at 616 (Mason CJ, Brennan, Deane, Dawson, Gaudron, McHugh JJ); Tatts Group at [26].

(e) a claim in respect of a class of documents is, by its nature, general and that claim will normally be upheld if the class is one that is recognised as being, prima facie, subject to PII;[51]
[51]Spencer (No 3) at [43] (Emmett J); Tatts Group at [27].

(f) a claim for PII requires the claimant to demonstrate that production of the documents for inspection would be contrary to the public interest;[52]
[52]Zarro v Australian Securities Commission (1992) 36 FCR 40 at 45 (Lockhart J), referring to Sankey v Whitlam (1978) 142 CLR 1.

(g) immunity from disclosure is not automatically accorded to documents falling within a class claim. There is no absolute immunity from production and inspection of, for example, Cabinet documents.[53] The Court must still weigh the public interest in the proper functioning of government with the public interest in the proper administration of justice whereby all relevant documents are available to a party seeking to litigate a claim;[54]

[53]Sankey at 43, 58-59, 95-96; Northern Land Council at 616; Murrumbidgee at [19].
[54]Northern Land Council (1993) 176 CLR 604, 616-620; Betfair v Racing NSW (2009) 181 FCR 66, [24] (‘Betfair’).

(h) in weighing the competing public interests under s 130 of the Act, the Court is required to give weight to the assertion of a responsible representative of the government or other body concerned that there is a public interest, which would be placed in jeopardy by the production of the document;[55]
[55]New South Wales v Ryan (1998) 101 LGERA 246, 250-251 (Burchett, Hill and Madgwick JJ) (‘NSW v Ryan’); Sankey (Gibbs ACJ), 59–60 (Stephen J), 96 (Mason J).

(i) in order for the public interest in the administration of justice to arise in the balancing process, the documents must contain ‘material evidence.’[56] Relevance to the proceedings is of itself insufficient. The documents must have an important bearing upon the ultimate decision on the relevant questions;[57]

(j) documents relating to a topic that is current or controversial will attract a high level of confidentiality;[58] and

(k) PII cannot be waived by individuals or by the government.[59]

[56]Alister v The Queen (1984) 154 CLR 404, 412 (Gibbs CJ); Tatts Group at [33].

[57]Krew v Federal Commissioner of Taxation, (1971) 2 ATR 230, 232; Tatts Group at [33] (this paragraph as it appeared in Matthews v SPI Electricity Pty Ltd [No 11] [2014] VSC 65, was cited with approval by Kings J in Ryan v State of Victoria [2014] VCC 1692 at [21] and referred to with apparent approval in Ryan v State of Victoria [2015] VSCA 353 at [37] and [139] (per Tate JA, Santamaria and Ferguson JJA agreeing).

[58]Northern Land Council at 617–618; Murrumbidgee at [19]; Tatts Group at [32].

[59]Middendorp Electric Co Pty Ltd v Law Institute of Victoria [1994] 2 VR 313 at 324 (‘Middendorp’); Rogers v Home Secretary [1973] AC 388 at 407.

In Ryan, the Victorian Court of Appeal summarised the factors to be considered in the balancing or weighing exercise, as follows:[60]

In undertaking the balancing exercise, the court will generally have regard to a number of considerations. These include whether non-disclosure would impede the accused’s right to a fair trial,[61] the evidentiary value and importance of the documents to the issues,[62] whether ordering disclosure would cause sources of information to ‘dry up’, whether preserving candour would facilitate the public function in issue, and whether the material is already in the public domain[63] or has current sensitivity.[64] The court is also to accord weight to an assertion by an authorised representative of government that the public interest would be at risk in the event of disclosure.[65]

[60]Ryan at [57] (per Tate JA, Santamaria and Ferguson JJA agreeing).

[61]Alister v The Queen (1984) 154 CLR 404.

[62]Australian National Airlines Commission v Commonwealth (1975) 132 CLR 582.

[63]J D Heydon, Cross on Evidence (LexisNexis Butterworths, 10^th ed, 2015) [27175]–[27185].

[64]Brazel (2008) 19 VR 553, 557 [8], 560 [16], 569 [52].

[65]Sankey 44, 46 (Gibbs ACJ), 59–60 (Stephen J), 96 (Mason J).

There is a three-step process involved in the consideration of a claim for PII:[66]
[66]Sportsbet Pty Ltd v Harness Racing Victoria (No 4) [2011] FCA 196 [4] (per Mansfield J); Spencer (No 3) at [22] (per Emmett J).

(a) the first step is to decide whether there is a risk that production and inspection of the documents in issue would be injurious to the public interest;

(b) the second step is to determine whether there is a public interest in a party having access to those documents because such access is in the interests of the fair administration of justice; and

(c) the third step is to determine whether the public interest in the fair administration of justice outweighs the desirability that the information not be disclosed.

Client Legal Privilege

The Commonwealth relies on legal advice privilege, that is on s 118 of the Act:

118 Legal advice
Evidence is not to be adduced if, on objection by a client, the court finds that adducing the evidence would result in disclosure of—
(a)a confidential communication made between the client and a lawyer; or
(b)a confidential communication made between 2 or more lawyers acting for the client; or
(c)the contents of a confidential document (whether delivered or not) prepared by the client, lawyer or another person—

for the dominant purpose of the lawyer, or one or more of the lawyers, providing legal advice to the client.

The Commonwealth bears the onus of establishing the claims, including each factual element necessary to establish the requisite dominant purpose. In that respect, focused and specific evidence is usually required, rather than mere generalised assertion, let alone opaque and repetitious verbal formulae. There should be sufficient evidence which proves directly or by inference that the dominant purpose for the communication was for the Commonwealth to obtain legal advice. The communication also has to be confidential.[67]
[67]Asahi Holdings (Australia) Pty Ltd v Pacific Equity Partners Pty Ltd (No 4) [2014] FCA 796 [29]; see also Australian Crime Commission v Stewart (2012) 286 ALR 713 [69] and AWB Ltd v Cole (2006) 232 ALR 743; Ausnet Electricity Services v Liesfield [2014] VSC 474 [119] (per Robson J); Barnes v Commissioner of Taxation (2007) 242 ALR 601 [18]

Notwithstanding these observations, in an appropriate case, it is also available for the Court to inspect the documents in question pursuant to the power given by s 133 of the Act and by that means assess the apparent purpose of the AGS Report, as I did when initially determining that the unredacted AGS Report was the subject of advice privilege.[68] As I have said, the reason for arriving at the conclusion that the unredacted AGS Report is privileged from an examination of it was the efficient conduct of the business of the Court and the efficient use of judicial resources.[69]
[68]New South Wales v Jackson [2007] NSWCA 279 [24] (per Giles JA (Mason P and Beazley JA agreeing)).
[69]See paragraph 31 above.

Point Trading’s Submissions

Point Trading submitted that the Court has an overriding power to control its own proceedings,[70] and where the interests of justice so require the Court was able to make orders in relation to the unredacted or the redacted AGS Report and the SER, notwithstanding that I had found the unredacted AGS Report was privileged and notwithstanding that Point Trading had withdrawn its application to inspect the redacted AGS Report and the SER over the objection of the Commonwealth (when they had been produced pursuant to Point Trading’s subpoena).
[70]Strategic Management Australia AFL Pty Ltd v Precision Sports & Entertainment Group Pty Ltd [2015] VSC 717 [5].

In relation to the SER, Point Trading made submissions as to the applicable law relating to PII broadly in line with the outline of that law set out above.

The procurement of material for the Commonwealth, including weapons systems, has to be conducted pursuant to published procurement guidelines and principles.[71] A part of this transparency is the keeping of detailed records of decisions made during the procurement process.[72]
[71]Quinn’s affidavit at [30]-[32].
[72]Commonwealth Procurement Guidelines: Financial Management Guidance No. 1 (2008) at [7.8] where it is provided that documentation ‘is critical to accountability and transparency. It provides a record of procurement activities and how they have been conducted and facilitates scrutiny of these activities’.

Point Trading also submitted that:

(a) the Commonwealth’s reliance upon the affidavits of Mr Elliott and Brigadier Welsh do not discharge the burden cast upon it to establish privilege or PII;

(b) the SER is said to contain sensitive commercial information.[73] Nevertheless, the Commonwealth provided a copy of the SER to Point Trading’s former legal representatives subject to their confidentiality undertaking. That copy was returned to the Commonwealth and Point Trading’s current legal representatives have not seen it;
[73]Elliott Affidavit 3 December 2014 at [14].

(c) Point Trading is in possession of a partial copy of a version of the SER (an 18 page document the covering page of which is entitled ‘Source Evaluation Report’ (‘Partial SER’). This was provided by an unknown source and contains no discernible classification as ‘secret’ or ‘confidential’.[74] Mr Elliott deposes to the Partial SER not being a copy of the final SER, and he assumes that it is from an earlier version;[75]
[74]Mews’ Affidavit at [38].
[75]Elliott Affidavit of 22 December 2015 at [12].

(d) Mr Elliott’s evidence[76] that the 2013 RFT is for a LWAGL of the same capability as the 2007 RFT is wrong because of the significant differences between them as deposed by Mr Klein;[77]
[76]Elliott Affidavit of 3 December 2014 at [17].
[77]Affidavit of Klein of 18 January 2016 at [17]-[18].

(e) there is no substance to the evidence of Mr Elliott in paragraphs 17 to 19 of his 3 December 2014 affidavit (as to which see the Annexure to these reasons) because Point Trading was not a tenderer in the 2013 RFT and it is unlikely that the Commonwealth will put out an RFT for a LWAGL for the next few decades;

(f) the SER relates to the two weapons proposed in respect of the 2007 RFT, is about 7 years old, and the information about different LWAGLs, the countries using them, their capabilities and comparisons are available on the internet;[78]
[78]Klein’s Affidavit of 18 January 2016 at [20] and exhibit AK-2.

(g) the financial sensitivities are not substantiated as it is known that Nioa and the Commonwealth have entered into a contract pursuant to the 2013 RFT of an estimated value of $47 million;[79]
[79]Elliott Affidavit 22 December 2015 at exhibit BAE-6.

(h) Mr Elliott’s evidence regarding Nioa’s successful tender under the 2013 RFT for the LWAGL has been redacted so that Point Trading cannot identify on what system the proposed weapon is based.[80] However, Nioa’s website makes it clear that the weapon is the General Dynamics Striker 40 MK 47 MOD 0 40mm LWAGL, 70 and the site provides photos and its details, including that it is in service with US SOCOM. It is apparent from an internet search that the Israeli Defence Force also uses that weapon;
[80]Elliott’s Affidavit 22 December 2015 at [4]

(i) the evaluation of tenders is product specific and knowledge of the SER will not assist Point Trading with tenders for any other product, contrary to the assertions in Mr Elliott’s evidence.[81] Procurement occurs pursuant to published procurement guidelines, and it is the practice in the industry for private companies submitting tenders to engage retired ADF/DMO employees as consultants to assist them in tendering;[82]

(j) the evidence of Mr Elliott[83] that the SER is not relevant to the decision to conclude tender negotiations with Point Trading is not correct having regard to the events and correspondence set out in paragraphs [32] to [39] of the Point Trading’s Counterclaim against the Commonwealth; and

(k) the SER appears to have been leaked to HK’s agent in Australia in circumstances where HK was a part of a tender in respect of the 2013 RFT.

[81]Elliott Affidavit of 22 December 2015 at [15]-[17].

[82]Klein’s Affidavit of 18 January 2016 at [22].

[83]Elliott affidavit of 3 December 2014 at [62].

In relation to the unredacted and redacted AGS Report, Point Trading submitted that privilege is an exception to the basic notion of discovery.[84] A communication that lacks confidentiality is not privileged even though it is between a solicitor and client.[85] In Gunns Ltd v Marr,[86] Kaye J said:

A document which is created for the ‘dominant’ purpose of obtaining legal advice may be the subject of legal professional privilege. The party asserting the privilege bears the onus of establishing its entitlement to rely on it. Where the existence of legal professional privilege is an issue, the Court is not bound by the ritual incantation of a formula asserting privilege by the party resisting production of the document. In an appropriate case, the Court may inspect the documents, which are the subject of the claim for privilege, in order to determine the claim for privilege is well founded.

[84]See ss 118 and 119 of the Evidence Act 2008 (Vic).

[85]See Cairns, Australian Civil Procedure (2014) at [10.450].

[86][2008] VSC 464 [37].

Two differently redacted versions of the AGS Report have previously been provided to Point Trading under cover of an email marked ‘Unclassified - Legal in confidence and without prejudice.’[87]
[87]Mews’ Affidavit at [25] and [31] and affidavit of Swift at 13 February 2015 which as exhibit BPS-01 exhibits the redacted AGS Report.

The redacted AGS Report was produced as a result of Point Trading’s formal procurement complaint for purposes of the Commonwealth’s Procurement Guidelines.[88] The AGS Report is supposed to be the result of an independent review according to Chapter 5.7B of the Defence Procurement Policy Manual (‘DPPM’), conducted on an arm’s length basis, but without Point Trading’s participation.[89] The AGS Report is not a document that satisfies the principles for legal professional privilege.
[88]Mews’ Affidavit [25]-[26].
[89]Mews’ affidavit at [26] and exhibit LGM-9, letter from Harry Dunstall, Acting Deputy Chief Executive Officer/General Manager Commercial, DMO.

The fact that the covering email was marked ‘without prejudice’ does not preclude the redacted AGS Report from being produced, because the requirements for that privilege to exist have not been satisfied.[90]
[90]Desiatnik, Without Prejudice Privilege in Australia (2010) at 19.

The Commonwealth has failed to discharge its burden to establish privilege in respect of the unredacted AGS Report. Point Trading seeks production of the un-redacted AGS Report.

Commonwealth’s Submissions
Commonwealth Submissions regarding the SER

The Commonwealth submitted that after considerable argument Point Trading’s subpoena, pursuant to which the AGS Report and the SER were produced, was set aside on 24 February 2015. In upholding the Commonwealth’s objections to the inspection of particular documents, the Court accepted that they were the subject of PII or client legal privilege. It is therefore no longer possible for Point Trading to seek an order from the Court for inspection of those documents.

In any event, the Source Evaluation Report is the subject of PII and the AGS Report (in both its redacted and unredacted forms) is the subject of client legal privilege which has not been waived. The redacted AGS Report is also the subject of without prejudice privilege. The confidential affidavits of Mr Elliott, Lieutenant Colonel Mollman and Brigadier Simon Welsh explain the reasons for this position. Those affidavits also attract PII in part.

At the time the Commonwealth objected to the production for inspection by Point Trading of the SER and the AGS Report, as referred to in the order of the Court made on 28 November 2014,[91] there was significant commercial sensitivity in both documents because the information in those documents was not in the public domain and related to a competitive tender process which had ended without any contract being entered into. The process had started again by the 2013 RFT and the bids for that tender had recently closed.[92] The release of information in the documents might have given to a tenderer specific commercial knowledge it would not otherwise have.[93] The availability of the documents to tenderers and others may have disclosed information about the Commonwealth’s approach to the evaluation of competing bids.[94]
[91]Authenticated on 2 December 2014.
[92]Mollman Affidavit [18].
[93]Mollman Affidavit [20].
[94]Mollman Affidavit [21].

Further, performance and technical data about the weapons systems involved in the 2007 RFT was not in the public domain and the weapons system is in service in other countries and the Commonwealth has an obligation to keep the information about the performance of the weapon system confidential and secure.[95]
[95]Mollman Affidavit [23].

Mr Elliott was, at the time he made his affidavits, Deputy Counsel within the Contracting and Legal Division of the DMO. In his affidavit of 27 November 2014, he gives considerable evidence as to his role and the role of the Land Systems Division of the DMO relating to the acquisition and sustainment of designated land systems, such as the LAWGL, for the ADF.

The Commonwealth made submissions as to the law relating to PII broadly in line with the outline of that law set out above. In submissions, the following matters were emphasised:

(a) the immunity draws on considerations of the procurement of weapons systems in circumstances where the report in question is concerned with the evaluation of competing tenders. It involves a consideration of the likely effect of adducing evidence of the information in the SER, and the means available to limit its publication, because the SER in this case evaluates competing tenders where the tenderers provide information to the Commonwealth on the basis that it will be kept confidential. If tenderers cannot rely on that confidentiality, and come to the view that that information is going to be disclosed more broadly than they are led to believe, then they may be reluctant in future to provide such information to the government for the purposes of their future dealings. That means the government is potentially compromised in relation to the nature and extent of information that it will receive for people who are tendering for Commonwealth contracts;

(b) this has the potential to compromise the acquisition of weapons systems on a competitive basis so as to get the best outcome for the best price. That in turn could have a detrimental effect on national security;

(c) the disclosure of highly sensitive weapons testing information relevant to their capabilities; and

(d) the weapons systems evaluated, or parts of them, are in use by allies of Australia and the disclosure of the evaluation may damage international relations.

Commonwealth Submissions regarding the AGS Report

In relation to the redacted AGS Report, the Commonwealth contended that the AGS prepared it for the purposes of conducting a review and giving advice about the claim that was being put forward by Point Trading for compensation. A redacted version of this legal advice was provided to Point Trading on a without prejudice basis and without waiving privilege for the purposes of Point Trading understanding the position taken by the Commonwealth and why that position was taken.

The Commonwealth submitted that it was evident from a reading of the unredacted as well the redacted AGS Report that the dominant purpose of the report was for the AGS to give legal advice to the DMO, and that the AGS was engaged by the DMO for that purpose.

Consideration
The AGS Report
The Unredacted AGS Report – document 1 in the Privilege Table

There is a great deal of authority on the correct approach to the making of a second or subsequent interlocutory application. As Point Trading submitted, the Court has an overriding power to control its own interlocutory proceedings and matters of practice and procedure,[96] and where the interests of justice so require the Court is able to make orders in relation to the unredacted and the redacted AGS Report notwithstanding the earlier finding relating to the unredacted AGS Report or that Point Trading withdrew its application to inspect the redacted AGS Report when it had been produced pursuant to Point Trading’s subpoena. However, generally speaking, the Court will not lightly vary or set aside orders previously made, at least in the absence of fraud or fresh evidence.[97]
[96]Strategic Management Australia AFL Pty Ltd v Precision Sports & Entertainment Group Pty Ltd [2015] VSC 717 [5]; Oke v Commissioner of the Australian Federal Police [2005] FCA 1363 [20]-[23]; Commonwealth of Australia v Albany Port Authority [2006] WASCA 185 [23]-[28]; National Parks and Wildlife Service v Pierson (2002) 55 NSWLR 315, 318.
[97]DA Christie Pty Ltd v Baker [1996] 2 VR 582, 605; Nominal Defendant v Manning (2000) 50 NSWLR 139, 156-7 (per Heydon JA); Phillip Morris Ltd v Attorney General for the State of Victoria & Lindsey [2006] VSCA 21 [120] (per Ormiston JA).

In Tenth Vandy Pty Ltd v Natwest Markets Australia Pty Ltd,[98] Hargrave J reviewed the authorities and concluded:

…the correct approach to apply to second or subsequent interlocutory applications is that stated in Manning and Pierson that “the overriding principle governing the approach of the court to interlocutory applications is that the court should do whatever the interests of justice require in the particular circumstances of the case.”[99] As I have said, this statement was referred to with apparent approval by Maxwell P in Philip Morris.[100] Further, this approach is consistent with the statement of Brooking JA in Christie quoted above in respect of interlocutory applications concerning questions of practice and procedure that:
“... it is, generally speaking at all events, open to the court to exercise a wide discretion in the interests of justice in considering whether an applicant who has failed on the merits may none the less succeed on a second application.”[101]

[98][2006] VSC 170 [46].

[99]Pierson (2002) 55 NSWLR 315, 318; Manning (2002) 50 NSWLR 139,161.

[100][2006] VSCA 21 [61].

[101][1996] 2 VR 582, 597.

As I have said, the unredacted AGS Report has been held to be privileged. The order made on 28 November 2014 specifically upheld the objection of the Commonwealth to Point Trading inspecting it. There was no appeal from that order, and no objection was taken to the Court’s approach to relying on its own inspection for the purpose of arriving at the conclusion that it is privileged.

Point Trading submitted that AGS Report is not a document that satisfies the principles for legal professional privilege because it:

(a) was produced as a result of Point Trading’s formal procurement complaint for purposes of the Commonwealth’s Procurement Guidelines;[102] and

(b) is supposed to be the result of an independent review according to Chapter 5.7B of the DPPM, conducted on an arm’s length basis. Point Trading chose not to participate.[103]

[102]Mews’ Affidavit [25]-[26].

[103]Mews’ affidavit [26] and exhibit LGM-9, letter from Harry Dunstall, Acting Deputy Chief Executive Officer/General Manager Commercial, DMO.

Having regard to these submission, I have carefully read the unredacted AGS Report and the DPPM. I have done so because of the fact that the document was prepared as a review pursuant to the DPPM was not specifically referred to at the time of my previous finding and nor was the relevant section of the DPPM referred to or put into evidence, as it now is.[104] This is a new circumstance relevant to the character of the document that could affect its status as a confidential document produced for the dominant purpose of the AGS giving legal advice to the DMO.
[104]LGM-10 to the Mews’ Affidavit.

I note that the fact that the Commonwealth has been joined as a party does not affect the character of the document. Clearly it is discoverable by the Commonwealth if it is relevant to an issue or issues in the proceeding, but that is not the question. The question is whether it may be inspected by all parties to the proceeding and may be tendered in evidence, whether that tender is subject to confidentiality restrictions or not.

It is noted in paragraph 2.1 of the unredacted AGS Report that:

AGS has been engaged by DMO to conduct a review, in accordance with the procedure for an independent internal investigation of a procurement complaint as described in Chapter 5.7B of the Defence Procurement Policy Manual (DPPM) of circumstances leading up to the termination of negotiations with Point Trading. …

Later in the report,[105] it is again noted that Point Trading was notified by Defence that it intended to handle Point Trading’s request for compensation as a formal procurement complaint and ‘AGS was engaged to undertake the review in accordance with Chapter 5.7B’ of the DPPM.
[105]At paragraph 4.52 of the DPPM.

Part 5.7B of the DPPM as in force at the applicable time and put into evidence by Point Trading[106] sets out in paragraphs 14-20 the process for an independent internal review. Nothing in those paragraphs assists in determining whether such a review is for the dominant purpose of the DMO receiving legal advice, and much of the policy tends to indicate the contrary. At the beginning of Part 5.7B of the DPPM there are references to the necessity for procurement officers to obtain advice ‘from contracting specialists’ when investigating any complaint due to the potential commercial and legal implications flowing from the review process.
[106]Exhibit LGM-10 to Mews’ Affidavit.

My detailed review of the unredacted AGS Report leads me to the conclusion that it was not created for the dominant purpose of giving legal advice to DMO as submitted by the Commonwealth. The report does contain legal advice, but that is not its dominant purpose as the quoted extract from the report amply demonstrates. The presence of legal advice within it leads me to conclude that the appropriate course is to permit the Commonwealth to redact it to conceal the parts containing legal advice. Further, there are references in it to the SER and its contents and to correspondence that may still be the subject of privilege. I will therefore give the Commonwealth the opportunity submit evidence should it so desire to justify redactions to conceal references to privileged material or aspects of the SER that might reveal PII material. However, I note that in the redacted version of the AGS Report there are unredacted references to the SER.

The Redacted AGS Report – document 3 in the Privilege Table

Having regard to my finding that the unredacted AGS Report was not produced for the dominant purpose of the AGS giving legal advice to the DMO, it follows that the redacted version is not subject to client legal privilege, except perhaps in the parts of the report that contain advice and which may yet be redacted.

The first version of the redacted AGS Report given to Point Trading was under cover of a letter from Special Counsel in the DMO dated 17 November 2011.[107] In that letter there is no mention of the retention of any client legal privilege. It is said that:

..the report is provided to Point Trading on a confidential basis. It is to be treated as the Commonwealth’s confidential information and not disclosed to any third party (other than Mallesons Stephen Jaques) without the Commonwealth’s prior consent.

[107]Document 4 in the Privilege Table.

The next version was given under cover of an email dated 29 June 2012 from the same Special Counsel in the DMO.[108] The email is marked ‘Unclassified - Legal in confidence and without prejudice.’It is said to contain fewer redactions to the copy previously provided. In the email it is said:

As foreshadowed at our meeting, you’ll notice that the attached report contains a very small number of redactions. These redactions cover personal information, information that relates to the commercial interests of third parties (eg other tenderers) and/or references to source material that may attract legal professional privilege. We consider these redactions are necessary and appropriate to protect the Commonwealth’s and third party interests and that any further release would need to be supported by extensive due diligence of referenced source material and third party consultation.

[108]Exhibit BPS-01 to the Affidavit of Brendan Peter Swift sworn 13 February 2015.

Despite the heading of the email marked ‘Unclassified - Legal in confidence and without prejudice,’ this quoted extract, shows in my view, that the report was not considered to be the subject of privilege as a whole and was not given to Point Trading as a document that was subject to client legal privilege, except in some redacted parts.

Conclusion

In conclusion:

(a) the unredacted AGS Report is not a document created for the dominant purpose of giving legal advice to the Commonwealth and is not the subject of client legal privilege, although parts of it may be appropriately redacted as they contain advice or may refer to material the subject of PII;

(b) the redacted version, although slightly different and bearing a different date, is of the same character as the unredacted report and is also not subject of client legal privilege; and

(c) it is therefore unnecessary to consider whether the redacted reports were given subject to without prejudice privilege and in a way that might preserve their status as privileged.

The SER

The Court has, as I have already pointed out, an inherent jurisdiction to control its procedures and processes. That extends to making orders that limit access to court documents or restrict the way in which facts are referred to in open court.[109] It also extends, in my view, to enable the Court to consider the claim by Point Trading to inspect the SER, and for that purpose to determine the objection by the Commonwealth that it is subject to PII, notwithstanding the withdrawal of the earlier application to inspect and the striking out of the subpoena insofar as it related to the SER. Whether it is appropriate to do so turns on where the interests of justice lie. That turns on the application of the law as to PII and the evidence in support of the claim for PII.
[109]See s 7(d) of the Open Courts Act 2013 (Vic); Strategic Management Australia AFL Pty Ltd v Precision Sports & Entertainment Group Pty Ltd [2015] VSC 717 [5].

The evidence of Mr Elliott regarding the process giving rise to the SER is, in part, as follows:[110]
[110]Elliott Affidavit 3 December 2014, [3]-[13].

(a) the DPPM governs commercial contracting for Defence and sets out a systematic approach for Defence procurement;

(b) in an open tender process which seeks tenders from industry, the bids that are submitted need to go through an evaluation process to ultimately determine which bid is preferred and then make a recommendation for the appropriate delegate to proceed to the next phase in the procurement process;

(c) there are the three main phases – the screening phase, the evaluation phase and then the negotiation phase;

(d) the recommendation from the evaluation phase is embodied in the SER. Typically, tenders submitted are evaluated by a Tender Evaluation Board (‘TEB’). The TEB comprises a number of subject experts from within Defence whose task, in accordance with the DPPM, is to consider the bids received which have passed through the initial screening process to ensure that they are compliant in terms of meeting minimum requirements;

(e) the TEB analyses the valid tenders and methodically considers various elements of each tender. Matters that are addressed include considerations such as project management, the financial offer, the tendered solution or capability, and compliance with Commonwealth terms and conditions of contract;

(f) the compliance profiles of the bids are considered. Not only is there analysis of the level of compliance, but there is also analysis of the level of non‑compliance and thus the potential level of risk for each element within each bid;

(g) capability is a significant part of the bid analysis and the assessment of claims made by a tenderer to meet the Commonwealth’s tender specifications;

(h) the SER documents the analysis of risks presented by the individual elements of each bid to allow the chairman of the TEB to sign off on the SER and to conclude a recommendation for the delegate;

(i) from the analysis undertaken, the SER feeds elements of detail to build up sufficient information to explain to the delegate recommendations made in the SER and which then enables the delegate to understand the strengths and weaknesses of bids in context; and

(j) if the recommendation of the TEB contained in the SER is for transition to the contract negotiation stage of procurement, it is then up to the delegate to consider whether or not to endorse the SER recommendation. It is solely a decision for the delegate.

Other parts of the evidence of Mr Elliott establish several bases for PII in respect of the SER. These are set out in extracts from his 3 December 2014 Affidavit in the Annexure. They fall into the following categories:

(a) the SER contains sensitive commercial information;

(b) the SER contains an evaluation of capability of the competing weapons systems; and

(c) Original Equipment Manufacturers (‘OEM’) expect information provided to DMO in a tender response to remain strictly confidential, especially in relation to weapons capability and price.

In August 2008, the SER was signed by the TEB Chair. Point Trading was recommended as the preferred tenderer. In July 2009, an invitation to commence negotiations was provided to Point Trading. Contract negotiations commenced in August 2010.

Because the SER was finalised in August 2008, the Commonwealth contends that it can have no relevance to the decision made to finalise the tender negotiations with Point Trading in February 2011. The evidence suggests that the reason that Brigadier Phelps, the delegate who finalised the tender negotiations with Point Trading, formed the view that the tender would be non-compliant was not related to the SER in which the recommendation was made that Point Trading be the preferred tenderer. The SER contains an analysis about the competing tenders or bids and it reflects the comparative assessment about the weapons systems proposed by the tenderers. It does not appear to be directly relevant to the ultimate decision communicated on 28 February 2011 terminating the negotiations with Point Trading.[111]
[111]Elliott Affidavit of 3 December 2014 [62].

Point Trading submits that the SER is relevant because at the time of terminating the process in February 2011, the Commonwealth said that Point Trading’s tender did not comply with the 2007 RFT, whereas the SER presumably assessed the competing tenders on the basis of the tender complying with the RFT. So, Point Trading submitted, despite the fact that Point Trading was the preferred tenderer because its proposed solution was the better solution and complied with the RFT, the Commonwealth later terminated the process on the footing that Point Trading’s tender did not conform.[112] Point Trading submits that if the SER makes no mention of any issue about the supply of ammunition and ballistic tables that would make it relevant to Point Trading’s counterclaim. Point Trading also submits that it is relevant because it identifies certain issues that need to be taken up with the tenderers.[113]
[112]Transcript, 15 February 2016, p 110T2PP.
[113]Transcript 16 February 2016, p 6-7 (by reference to the Partial SER).

Point Trading also points to the lack of an identifiable classification of the SER as top secret, secret, commercial-in-confidence or confidential, and the apparent similarity between the Partial SER and the description of the SER in the affidavit of Mr Elliott dated 3 December 2014 where, in the course of describing various parts of it, he sets out why they should be the subject of PII. In other words, the confidentiality inherent in PII has been partially defeated by the leaking of a part of the SER to Point Trading.

On the other hand, the Commonwealth submissions and my inspection of the SER show that it is marked ‘Commercial – in – Confidence’, that it does differ from the Partial SER in many respects, and the bases for the maintenance of its confidentiality and its immunity from production for inspection remain notwithstanding the entering into contracts pursuant to the 2013 RFT and the age of the SER.[114] The Elliott Affidavit of 22 December 2015 provides a sound basis for the maintenance of the immunity notwithstanding the leaking of the Partial SER and the awarding of the contract to supply the LWAGL to Nioa. Extracts from that affidavit are set out in the Annexure.
[114]Now eight years.

If it could be established that the SER is relevant to a counterclaim made by Point Trading against the Commonwealth, the evidence advanced on behalf of the Commonwealth in support of its claim for PII establishes a sound basis for PII on the basis of a ‘contents claim’. From that evidence, and my reading of the SER, I consider that:

(a) the information contained in the SER is financially sensitive and contains details regarding the capability and performance of the weapons systems it considers;

(b) the weapon proposed by the competitor tenderer is in use with an ally and information about it is governed by proscriptive controls and the Commonwealth is obliged under International Traffic In Arms Regulations to keep this information confidential;

(c) the SER specifically relates to the capability requirements that DMO seeks to procure; and

(d) the information contained in the SER is not in the public domain. Detailed information regarding the weapons systems is highly confidential because of its use in service in overseas military inventories.

The Commonwealth also points to the desirability of avoiding the disclosure of information which would cause tenderers to lose confidence in the tender process. Such companies might be less inclined to tender if their sensitive information the subject of the tender, which they are informed will be kept confidential, is disclosed to anyone other than the Commonwealth.[115] Tenderers to the Commonwealth might also be less inclined to give full and frank information in connection with a tender if they consider that any information supplied might later be disclosed to a competitor or the public. Tenderers must have confidence in the process and in the maintenance of the confidentiality of their information when dealing with the Commonwealth.[116]
[115]Elliott Affidavit 22 December 2015 [23].
[116]Elliott Affidavit 22 December 2015 [24].

The SER was provided to counsel and solicitors previously engaged to represent Point Trading on a confidential and without prejudice basis. This was at a time before the subpoena of 14 August 2014 was issued and well before the Commonwealth was joined as a defendant to Point Trading’s counterclaim. It was provided to persuade Point Trading against claiming compensation from the Commonwealth as it had by correspondence threatened to do.[117] That copy of the SER has been returned and the Commonwealth has refused to provide a copy to Point Trading’s current legal advisers.
[117]Transcript, 24 February 2015, p 270.

My conclusion is that even if the SER could be shown to be relevant to the issues in the claim made by Point Trading against the Commonwealth or HK, on balance, the production of the SER for inspection by Point Trading would be contrary to the public interest.

After examining the SER, however, I am satisfied that it contains no information relevant to the issues raised by Point Trading in its counterclaim. The balancing exercise therefore needs no consideration.

Conclusion

I am satisfied from the evidence advanced by the Commonwealth that the SER is properly the subject of PII and is not relevant to Point Trading’s counterclaim. Accordingly, Point Trading is not permitted to inspect the SER.

I will hear the parties as to the appropriate orders to be made inconsequence of these reasons for decision.

Annexure

Extracts from the Affidavits of Bryan Andrew Elliott Sworn 3 December 2014 and 22 December 2015

Mr Elliott’s affidavit of 3 December 2014 sets out in general and then in some detail the basis for the claim to PII in respect of the Source Evaluation Report.

Under the heading ‘Commercial Sensitivities Associated with the SER’, he deposed:

14. By its nature, the SER contains sensitive commercial information.
15.The SER details the bids of any competent tender. In this case, the SER contains not only information about the bid presented by Faxtech Pty Ltd (‘Faxtech’), but also a competitor.

16.The SER identifies information about the proposed system presented by each tenderer. In addition to the price details, the SER identifies the clear linkages between the prime contractor and subcontractors – as each tenderer identifies discrete components that make up the proposed weapons system. It is the linkage between the various subcontractors and the individual components which gets put together to create the tendered solution.
17.As a result of the 2007 RFT not fulfilling the capability which Defence sought, there is a current procurement process for which tenders have recently closed. Defence has gone to market for the same LWAGL capability. The analysis of tendered solutions contained in the SE would be very useful to a bidder in the current process in the event one of the weapons system or a similar system which might use substituted components becomes the preferred tenderer in the current process. That is because it would potentially lead to an awareness of issues that were identified in previous processes, including the Commonwealth’s views about negotiation strategy to limit or eliminate risk, or to achieve a value for money outcome. It would be highly disadvantageous to the Commonwealth if this information were to come to be known to any party which has recently lodged a bid.
18.During the evaluation phase of the tenders that have now been submitted, the Commonwealth has a right to engage with tenderers about their bids in the form of clarification questions. That is to assist the evaluation of the bid. If knowledge of previously identified risks set out in the SER become known, that would provide a tenderer bidding with a similar system with an advantage relative to another bidder in the process who did not have access to the same information. In responding to a clarification question, with confidential SER information, the response may be skewed in a way that is seen to be desirable for the Commonwealth and potentially, less than full and frank disclosure will be provided.
19.Further, in the contract negotiation phase with the preferred tenderer, a party with information from the SER could, if a similar weapon system was preferred, result in a decrease in the negotiating position of the Commonwealth because the potential evaluation of factors such as project management, financial and capability can be presented in a way which is advantageous to the tenderer.

Under the heading ‘Weapons Sensitivities Associated with the SER’, he deposed:

20.The SER contains evaluative text concerning the analysis of capability of weapons. That follows the testing which was undertaken for each weapon system.
21.The Commonwealth’s evaluation of this tender process is highly secretive and sensitive. Not only do the tenderers not know of the Commonwealth’s evaluation as the trial data is not available to anyone, including the parties, but there is a broader issue of knowledge about the capability effect of in service weapon systems.
22.Land 40 – Phase 2 is intended to improve capability by procuring a proposed weapon system. That capability gap should not become known.
23.In addition, there is knowledge about the weapons systems themselves. The Commonwealth paid for testing of the weapons systems and the tenderers were not present when the trials were conducted. The SER thus contains elements of capability both in terms of actual capability found on testing, but also the shortcomings of the systems that was revealed during the testing.
24.The SER contains information about weapons which are currently in service with other nations. Performance data of weapons including evaluative assessment is highly confidential and secretive. This information is not in the public domain.

Under the heading ‘Global Sensitivities Associated with the SER’, he deposed:

25.Defence Material Organisation (‘DMO’) has a significant commercial facing role. The 2014/15 budget for DMO includes $6.3B in acquisition and $6.2B in sustainment expenditure.
26.Most of the Original Equipment Manufacturers (‘OEM’) in the defence environment are based overseas. It is critical for DMO that in tender responses the OEM response is fulsome. OEMs expect information provided to DMO in a tender response to remain strictly confidential – especially in relation to weapons and capability and price.
27.The global market for much of the material that comprise significant weapon systems is relatively small. DMO anticipates receiving bids to supply weapon systems from up to ‘a handful’ of suppliers because only a relatively small number of OEMs in the world produce this type of capability.
28.In accordance with Commonwealth Government procurement, when a contract is awarded, information is entered on Austender. The name of the contracting party together with the overall value of the contract is publicised. If information contained in the SER becomes known it may be possible that a capability outcome for the Commonwealth can be confirmed as having been secured because a knowledgeable OEM and others could make a direct linkage with information contained in the SER to obtain potential details of ADF capability.

Mr Elliott then sets out the basis for maintaining PII in respect of the separate parts of the SER.

Mr Elliott’s affidavit of 22 December 2015 sets out the basis for maintenance of the immunity in respect of the SER after the letting of the contract to supply the LWAGL to Nioa and after the leaking of the Partial SER. Relevant extracts are as follows:

Source Evaluation Report
2.At the time I swore my affidavit on 3 December 2014 there was an outstanding tender process underway to fulfil the Light Weight Automatic Grenade Launcher (‘LWAGL’) capability.
3.On 27 August 2015, the Minister for Defence announced that Nioa Pty Ltd was the successful tenderer to supply and support the provision of the LWAGL for the Australian Defence Force. …
4.Although Defence has now signed a contract for the purchase of a weapons system, the sensitivity surrounding the Source Evaluation Report (‘SER’) remains. My previous evidence in my 3 December 2014 affidavit detailing the sensitivities associated with the SER still applies. As I then observed, the SER contains information which is financially sensitive and relates to the analysis of bids and the confidential evaluation process of tenders. In addition, this particular SER not only refers to the weapons system presented in the bid by Faxtech Pty Ltd (‘Faxtech’), but also refers to the weapons system of a competitor… .
5.The capability performance of the [competing tenderer’s weapons system] … is in use by Australia’s allies and is now to be the weapons system used by the ADF. As such, capability performance of this weapons system is highly secret and must not be disclosed. It is not information in the public domain. For example, information about shortcomings highlighted during testing of the [competing tenderer’s weapons system] is highly sensitive information not only to Australia but also to its allies where the gun is currently in use.
6. The evidence which I previously gave regarding the weapon system proposed as part of the tender bid of Faxtech continues to apply because information about that weapon system is not in the public domain and the weapon system is in service with other nations.
Partial SER
7.On 13 March 2014, Faxtech informed the then Deputy Chief Executive Officer and General Manager Commercial, Defence Materiel Organisation (‘DMO’), Harry Dunstall that it thought H&K Systems Australia (or related H&K entity) may have been in possession of Land 40-2 documentation. …
8.Mr Dunstall wrote to Faxtech on 21 March 2014. The seriousness of the matter was highlighted …
9.Mr Dunstall made enquiries of H&K Systems Australia. At the conclusion of those enquiries, DMO was satisfied that H&K Systems Australia did not have in its possession any Land 40-2 documentation that it should not have.
10.Upon reading the affidavit of Lyndal Gaye Mews affirmed on 9 December 2015 … I became aware that Mr Avner Klein was in possession of 18 non-consequential (sic) pages of what is described as the SER.
11.The Commonwealth has significant concerns about these pages coming to be in Mr Klein’s possession and has commenced a range of enquiries regarding the serious breach of security in respect of his possession of material that he should not have. The Office of Defence Legal has been tasked to advise on the appropriate investigation which should be undertaken.
12.The 18 pages are not a copy of pages that appear in the final version of the SER. I assume the 18 pages are from an earlier version of the document which was ultimately signed as the SER.
13.In addition to the enquiries to be undertaken by Defence, the Commonwealth’s lawyers have been instructed to write to the lawyers for Faxtech seeking immediate return of the documents and any copies of the documents, as well as deletion and/or destruction of any electronic or other copies that might be in existence. The Commonwealth regards this security breach to be a very serious matter.
Faxtech
14.Even though the acquisition process for the LWAGL capability has now been finalised, the Commonwealth maintains that there continues to be significant sensitivities in respect of documentation that the Commonwealth seeks:
(a)Not to produce in this litigation; or
(b)To produce with redactions together with a regime in place to secure confidentiality in the documentation and in the information in it; or
(c)To produce with a restricted regime in place for accessing the material to secure confidentiality in the documentation and the information in it.

15.Defence will continue to source procurement of material and services through competitive tender processes. Information relating to the commercial sensitivity in the tender process and which is not within the public domain should not be provided to potential tenderers. All tenderers are entitled to a formal debrief of their tender bid in accordance with the Defence Procurement Policy Manual. In their individual debrief, a tenderer is provided with feedback that is confined to elements of their tender and the relative performance of their tender to others. The debrief process does not provide any in depth analysis of the process that was undertaken to evaluate tenders. This information is detailed in the SER and is not released to tenderers.
16.Faxtech has been a supplier to Defence in the past and continues to undertake this role. Faxtech continues to lodge new bids when tenders are opened in an effort to be successful. …
17.In addition to capability sensitivities surrounding documents, Defence seeks to retain confidential information that could potentially confer an advantage on Faxtech over another tenderer who does not have the same information. That is because Faxtech might gain an insight into the analysis undertaken by Defence during the tender evaluation processes. For example, the testing undertaken by Defence goes beyond testing undertaken by weapon manufacturers and as such knowledge of Defence testing would confer an advantage on Faxtech over other competitor companies. This may include being able to structure or tailor a bid that is based upon knowledge or an awareness of Defence analysis that is not revealed in the tender documentation.
Heckler & Koch GmbH
18.Heckler & Koch GmbH (‘H&K’) is a well-established original equipment manufacturer which is responsible for providing a range of individual or man portable weapons systems and sustainment capabilities to Defence. It is a significant weapons manufacturer that successfully competes in the Defence market.
19.Defence has an ongoing relationship with H&K through a variety of ongoing contracts because it supplies a number of capabilities that are currently in service.
20.H&K will most likely be involved in future bids for Defence business (as the foreign based supplier of a weapon similar to that put forward as part of the Faxtech bid, the subject of this litigation). The Commonwealth’s concerns expressed in paragraph 17 in the context of Faxtech also apply to H&K.

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22 November 2016