Higginson-Swann and Higginson-Swann

[2007] FamCA 617

FAMILY COURT OF AUSTRALIA

HIGGINSON-SWANN & HIGGINSON-SWANN [2007] FamCA 617

FAMILY LAW – PRIVILEGE - Waiver of Legal Professional Privilege

APPLICANT: Mr Higginson-Swann

RESPONDENT: Mrs Higginson-Swann

FILE NUMBER: SYF 2176 of 2004

DATE DELIVERED: 28 May 2007

PLACE DELIVERED: Sydney

JUDGMENT OF: Justice Le Poer Trench

HEARING DATE: 23 March 2007

REPRESENTATION

APPLICANT: Husband in person

COUNSEL FOR THE RESPONDENT: Mr Gould

Orders

1. All documents produced to the Court by the husband, either on his own behalf or in his capacity as an office bearer of a corporation, in answer to subpoena’s issued on 19^th December 2006 be released for inspection by the wife and her legal representatives.

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYF 2176  of 2004

Mr Higginson-Swann

Applicant

And

Mrs Higginson-Swann

Respondent

REASONS FOR JUDGMENT

Introduction

1. On 19 December 2006 the solicitors for the wife issued two subpoenas.  The first subpoena was addressed to the husband and required production of documents being legal files in respect of five pieces of litigation conducted by the husband and specified in that subpoena.  The second subpoena was addressed to Messrs Kemp Strang Lawyers and required production of the same legal files relating to five pieces of litigation involving the husband.

2. At the time the subpoenas were served on Kemp Strang it appears common ground that firm held none of the legal files being sought in the subpoena.  The files had been collected by the husband and he held those files in his possession.

3. When the matter was before me on 16 February 2007 the solicitors for the wife sought leave to inspect the legal files named in the abovementioned subpoenas.  The husband claimed legal professional privilege.

4. On 16 February 2007 I made a direction that on or before 9 March 2007 the father provide to the Exhibits Clerk of this Court two bundles of documents in answer to the subpoena served on the father by the mother and filed 19 December 2006.  One bundle was to be clearly marked “Material subject to claim of legal professional privilege”;  the other to be marked “Material which may be inspected by the wife”.  The matter was thereafter listed for determination by me at 2.30 pm on 23 March 2007 in relation to the husband’s claim for legal professional privilege.

5. Counsel for the wife contends that the husband has waived legal professional privilege in respect to the entirety of the files and materials sought in the subpoena above-referred to.

6. In submission Counsel for the wife said that it will be part of the wife’s case at the forthcoming property hearing that the husband has committed waste of somewhere in the region of $100,000 (the wife contends more than $100,000) which sum was part of funds released to the husband from a controlled monies account for the purposes of allowing the husband to prosecute or defend the five pieces of litigation named in the subject subpoenas.  There is no issue that funds were released to enable the husband to continue with his involvement in the litigation referred to in the subpoenas.

7. Counsel for the wife argues that the litigation, the subject of the subpoena, was controlled entirely by the husband and that the husband has an obligation to make a complete disclosure of all matters relating to that litigation so that the wife might satisfy herself, as contended by the husband, it was appropriate for him to continue that litigation and in so doing he was not negligent, wanton or reckless.

8. The issue is confined to waiver of legal professional privilege.  The wife relies on paragraphs 2, 3, 10, 13, 45, 47 and 49 of the husband’s affidavit sworn 3 March 2006.  I here set out those particular paragraphs:

   “2.There have been a number of Litigation actions taken against me since 2003 which have all reached the stage for hearings.  The only litigation matter related to one of my companies, [A Pty Ltd], was taken by [H Company].  The other litigation matters relate to a different company, [J Pty Ltd].  The litigation actions involved are a) [I Pty Ltd], [Mr C] and the ATO.  I was never employed by this Company, owned no shares in the company and had only acted as a care taker director for this company for a short period of time (4-6 weeks) from mid December 2002 to sometime in January 2003.

   3.At all times I have had the full intention to fully defend all these matters and I have received legal advice that all the cases should be fully defended.

   …

   10.In December 2005 I had a meeting with my solicitor, Peter Harrison of Kemp Strang, to discuss preparation for the upcoming hearings.  Peter Harrison advised me that Kemp Strang would require $134,000 to cover the work required to complete the preparation for, and to cover the costs of, the upcoming hearings.

   …

   13.I received a letter from my solicitor, Peter Harrison, dated 27 January 2006.  Annexed hereto and marked with the letter “C” is a copy of that letter.  In the letter Peter Harrison outlined details of conversations he had had with the wife’s solicitor.  Peter Harrison stated that the wife’s solicitor had told him that no funds would be made available to defend the various litigation actions against me.  I found it highly concerning that Peter Harrison also reported to me that the wife’s solicitor had stated that he believed that I wanted to go bankrupt and that in such an event that they would be happy to deal with the official receiver.  I say that I have no desire to go bankrupt and believe, and have been advised, that all matters should be professionally and fully defended and that I have a high chance of being successful in all matters.

   …

   45.I believe that all matters should be fully defended and have been advised by my solicitor that I have a sound defence in all matters and that all the litigants have significant problems with the cases they are trying to make.

   …

   47.I believe that all matters should be properly and professionally defended and I believe, and have also been advised, that all matters have a high chance of being successful in my favour.

   …

   49.I ask the Court to grant my application that funds be released to Kemp Strang to enable them to continue their professional representation for me in the listed litigation proceedings and that funds be released to pay any costs awarded against me with regard to any orders made as a consequence of any delays caused by the circumstances of Kemp Strang ceasing to act for me in the listed litigation matters.”

1. The wife relies on my decision in Macquarie Bank and B & B reported 2006 FLC ¶93-290.  She says given the material relied on by the husband this is a clear case of waiver of legal professional privilege.

2. The wife also points to the conflict between on the one hand the obligation to make a full and frank disclosure and on the other the right to legal professional privilege.  She says that where, as in this case, a party relies on an inference that litigation conducted by one of the parties which taps into or affects the assets or resources of the parties which might reasonably be available for distribution between them pursuant to proceedings under section 79, then that party has an obligation to make a full and frank disclosure of all relevant documents and evidence which would enable the other party to satisfy themselves that such litigation has been conducted in a prudent and appropriate manner by the first party.

3. In the decision of Macquarie Bank and B & B I set out authorities which dealt with the matter of waiver of legal professional privilege.  In the conclusion to that case I determined that a waiver of legal professional privilege will be affected where:

   “the disclosure of material which would normally be the subject of a claim for legal professional privilege illustrates conduct which shows inconsistency between a party seeking to maintain legal professional privilege in relation to some communications pertaining to or touching upon an issue in the case but not others relating to the same issue.  For a waiver to be found, the Court must determine that it would be unfair to a party to allow the inconsistency to stand.”

1. In this case the disclosures as set out in the husband’s affidavit and referred to in these reasons cover a wide range of communications which the husband in the normal course would have been entitled to claim as the subject of legal professional privilege.  In this case he has clearly disclosed the contents of such communications.  It would, in my view, be inconsistent for the husband to be able to disclose that which is set out in his affidavit in respect of communications between himself and his lawyers in respect of the litigation referred to in the subpoenas, yet in relation to the same matter claim legal professional privilege in respect of other communications.  To allow the husband to do so would be quite unfair to the wife.

2. There is in this case, however a broader issue.  That broader issue is “does the husband’s general duty to disclose in the particular circumstances of this case, require him to make available all relevant documents to allow the wife to see for herself that the husband has been prudent with the parties’ assets and resources in pursuing the litigation?”

3. Pursuant to Rule 13.01 each of the parties has a general duty of disclosure.  That general duty requires disclosure of “all information relevant to the case”.  Given the particular facts of this case it is my opinion that under that general duty of disclosure the husband has an obligation to disclose to the wife all of the documents associated with the five pieces of litigation the subject of the subpoena in this case.  This must be plainly so given that a substantial part of the parties’ funds were released to the husband to pursue the litigation.  That release has given rise to an allegation of waste.  The wife is pursuing a case that the husband wasted some or all of those funds.

I certify that the preceding fourteen (14) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Le Poer Trench.

Associate: 

Date:  28 May 2007

IT IS NOTED that this judgment for all publication and reporting purposes be referred to as HIGGINSON-SWANN & HIGGINSON-SWANN