Lamers v Lamers
[2017] VSC 165
•3 April 2017
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMERCIAL COURT
S CI 2015 05124
| ANDREW JOHN LAMERS | Plaintiff/Defendant by Counterclaim |
| v | |
| JOHANNES ANTONIUS LAMERS | First Defendant |
| ORANA PARK PTY LTD (ACN 087 109 895) (both in its own capacity and as trustee of the John Lamers Family Trust) | Second Defendant/Plaintiff by Counterclaim |
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JUDGE: | Lansdowne AsJ |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 25 November 2016 and further submissions to 16 December 2016 |
DATE OF JUDGMENT: | 3 April 2017 |
CASE MAY BE CITED AS: | Lamers v Lamers and anor |
MEDIUM NEUTRAL CITATION: | [2017] VSC 165 |
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PRACTICE AND PROCEDURE – Client legal privilege – Privilege claim upheld after evidence filed – Subsequent withdrawal of claim of privilege due to earlier disclosure of document – Question of privilege re-opened - Disclosure waiver – Issue waiver – Derivative waiver – Certain documents held not to be privileged or to be produced by virtue of waiver - Evidence Act 2008 (Vic) ss 118, 119, 122 and 126
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff/Defendant by Counterclaim | Mr P H Caillard | Oakleys Legal |
| For the Defendants/Plaintiff by Counterclaim | Mr D B Clough | M & K Lawyers Group Pty Ltd |
TABLE OF CONTENTS
Introduction......................................................................................................................................... 1
Identification of issues and ruling on privilege....................................................................... 1
Developments after the oral hearing.......................................................................................... 4
Change of position by the defendants.............................................................................. 4
Should the question of privilege be re-opened?............................................................ 7
What documents are to be inspected............................................................................. 10
How privilege and waiver will be determined............................................................ 10
Summary of conclusions............................................................................................................ 11
Issues.................................................................................................................................................. 11
Issues in the proceeding............................................................................................................ 12
The Trust............................................................................................................................. 12
Trust Representations....................................................................................................... 14
The Orana Park Property................................................................................................. 14
Will Representations......................................................................................................... 16
Joint Endeavour................................................................................................................. 17
Reliance, detriment and relief sought............................................................................ 17
Issues in the application................................................................................................................. 19
Issues on privilege...................................................................................................................... 19
Issues on waiver.......................................................................................................................... 20
(a) Denials and assertions in the defence and notice of dispute (‘issue waiver’).... 20
(b) Supply to Andrew of certain documents (‘disclosure waiver’)............................ 21
Legal principles concerning client legal privilege..................................................................... 24
Privilege....................................................................................................................................... 24
Waiver........................................................................................................................................... 25
Points of disagreement in relation to waiver................................................................ 26
Discussion........................................................................................................................... 26
Conclusion in relation to principles on waiver............................................................ 29
Application of principles to this case........................................................................................... 30
Privilege....................................................................................................................................... 30
Documents which do not relate to John’s personal assets.......................................... 31
Communications responsive to those no longer claimed to be confidential........... 33
Waiver........................................................................................................................................... 35
Disclosure waiver.............................................................................................................. 35
Issue waiver........................................................................................................................ 36
Derivative waiver.............................................................................................................. 39
Documents now to be produced.............................................................................................. 40
Further issues.............................................................................................................................. 43
Entitlement to documents as a director and shareholder of the second defendant 43
Destruction of documents relating to the purchase of the Orana Park Property.... 44
Orders................................................................................................................................................. 44
HER HONOUR:
Introduction
This case concerns a dispute between the plaintiff (on occasion in these reasons referred to as ‘Andrew’) and his uncle, the first defendant (on occasion referred to as ‘John’), in relation to a farming property in Gippsland. Andrew alleges that John has resiled from representations made to him directly by John and by Mr John Barlow, John’s former solicitor, and also from his and John’s common intention about what would occur in relation to John’s shares in the second defendant and the John Lamers Family Trust (‘the Trust’) on John’s death. Andrew says that he has relied on these representations and the common intention to his detriment.
The current application is brought by the plaintiff by summons filed on 25 August 2016. It concerns claims for legal advice and litigation privilege made by the defendants over 73 documents, which have their origin in the files of the first defendant’s former solicitors Birch Ross & Barlow. The claim for privilege is made in the defendants’ Supplementary Affidavit of Documents affirmed by the first defendant on behalf of both defendants on 8 August 2016. The Supplementary Affidavit of Documents was filed as part of the largely agreed resolution, first recorded in orders made by me on 9 June 2016, of an earlier application by the plaintiff for third party discovery as against Birch Ross & Barlow. That summons was resolved on the basis that those solicitors would supply their files to the defendants’ current solicitors to enable the Supplementary Affidavit of Documents to be prepared.
Regrettably, the hearing of the current summons did not proceed smoothly. It is necessary to set out what occurred in some detail.
Identification of issues and ruling on privilege
First, it appeared from the exchange of written submissions prior to the first day of hearing, which was 2 November 2016, that the parties were not ad idem as to the matters in dispute. The plaintiff sought in counsel’s written submissions dated 31 October 2016 to both challenge the claim of privilege by the defendants, and assert that they had waived that privilege, if the disputed documents were privileged. The defendants’ written submissions dated 2 November 2016 assumed, however, that only waiver was in issue. The defendants brought the disputed documents to court with them, but had filed no evidence to support the claim of privilege, other than the standard assertions made in the Supplementary Affidavit of Documents itself. When I informed counsel for the defendants that I considered that the preliminary question of privilege, as well as the question of waiver, had been sufficiently put in issue, the defendants sought that I determine the privilege issue on the basis of my own examination of the disputed documents.
For reasons given orally and summarised in the Other Matters section of the orders made 2 November 2016 I ruled that it was not appropriate for the defendants to rely solely on the standard assertions in the Supplementary Affidavit of Documents and examination of the disputed documents by the Court; granted their request for an adjournment to put on evidence as to privilege; and ordered them to pay the plaintiff’s costs thrown away by reason of the adjournment.
Prior to the adjourned date of 15 November 2016, the defendants filed an affidavit of Nicole Jane Tyson, a partner of Birch Ross & Barlow to substantiate their claim of privilege. Ms Tyson deposed, amongst other things, that:
· she personally first commenced acting for the first defendant in approximately 1999;
· since that time to the best of her knowledge no other law firm (other than his current solicitors in this litigation) have acted for him in his personal capacity;
· the first defendant is ‘highly protective of the confidentiality of his personal asset position and estate planning matters’, in particular in relation to his wills;
· on search of the records of her firm she identified six files held for the first defendant personally ‘for his personal estate planning’;
· she had not located any files (prior to the current dispute with Andrew) held in the name of the second defendant or for John as a director of the second defendant; and
· she had reviewed the Supplementary Affidavit of Documents and the documents claimed therein to be privileged.[1]
[1]Affidavit of Nicole Jane Tyson sworn 11 November 2016 at [4], [5], [7], [13]-[14] and [16].
Ms Tyson grouped these documents into various categories for the purpose of her affidavit, depending on their author or character. She deposed as to the purpose of creation of the documents, and as to their confidentiality. Her evidence was to the effect that the dominant purpose of the creation of all of the documents was either the provision of legal advice to the first defendant or the provision of legal services to the first defendant in relation to the current dispute with the plaintiff. She did not depose as to confidentiality in relation to each individual document, but the thrust of the whole of the affidavit was that the communications contained within all the documents were confidential to the first defendant. Ms Tyson made no claim that the documents were confidential to the second defendant.
Critically, Ms Tyson did not depose that any of the documents claimed to be privileged in the Supplementary Affidavit of Documents were not, in fact, privileged, and nor did she depose that any of those documents had already been disclosed to the plaintiff.
On the basis of Ms Tyson’s evidence the plaintiff did not oppose the claim of privilege in respect of documents identified by Ms Tyson as having been created with the dominant purpose of the provision of legal services to the first defendant in relation to the current dispute i.e. those where litigation privilege was claimed. The plaintiff continued his objection to the remaining claims for privilege, largely on the basis that the evidence to support them remained inadequate.
After hearing argument, I ruled on that day, 15 November 2016, that, subject to provision of dates for documents currently undated, the claim of privilege was sustained. The relevant order provides:
Subject to the provision of dates or, if no exact date can be given, estimated dates for items 124-143 inclusive of Part 2 of Schedule 1 of the defendants’ Supplementary Affidavit of Documents affirmed 8 August 2016, the defendants’ claim of privilege in respect of the documents in Part 2 is sustained.
The defendants filed and served a further affidavit, again sworn by Ms Tyson, on 22 November 2016, supplying those dates.
In view of what subsequently occurred, I will attach to these reasons the revised transcript of my ruling that day. The ruling records the documents in respect of which the claim for privilege was not contested; the nature of the objection taken; and the reasons for my ruling.
On 25 November 2016 I heard oral argument as to whether the defendants had waived client legal privilege in respect of some or all of the documents in respect of which the claim of privilege was still contested by reason of action inconsistent with the maintenance of the privilege. I reserved my ruling at the conclusion of that hearing.
Developments after the oral hearing
Change of position by the defendants
In the course of oral argument on 25 November 2016, i.e. after I had ruled on privilege, counsel for the plaintiff made a passing comment that one of the documents already supplied to the plaintiff without objection[2] bore the same date as a letter between the same parties over which privilege was claimed, and contested, in the Supplementary Affidavit of Documents.[3] Counsel did not at that time elaborate on this comment, and nor did counsel for the defendants respond to the implied query as to whether the two letters were, in fact, the same. Significantly, while there is reference to the document already supplied in the affidavit in support of the summons and in the plaintiff’s written submissions filed prior to the first day of hearing, and there is reference to the document over which privilege is claimed of the same date between the same parties in Ms Tyson’s affidavit of 11 November 2016[4], neither counsel made comment on the similarity between the two documents until after I had ruled on the issue of privilege.
[2]A letter dated 9 December 2014 from Birch Ross Barlow solicitors to Westaway Bolge accountants, exhibited as TJR 50 to the affidavit of Trevor Rickard sworn 19 August 2016 and also referred to in the plaintiff’s written submissions dated 31 October 2016 at [45(e)].
[3]Document 99.
[4]At [48].
On reviewing my notes of the hearing on 25 November 2016 for the purpose of these reasons, I formed the view that this issue was potentially important. Accordingly, by email from my associate dated 30 November 2016 I required the defendants to confirm on oath whether in fact the two letters, one voluntarily disclosed, and one said to be privileged, were in fact the same, and, if so, permitted them to depose as to the circumstances in which the letter later claimed to be privileged had been disclosed. I also gave each party the opportunity to put further written submissions.
One of the three solicitors currently acting for the defendants in this proceeding, Mr Nicholas Allen, swore an affidavit in response to that direction. He deposed, amongst other matters, that:
· Birch Ross & Barlow prepared the defendants’ initial affidavit of documents;
· following the change of solicitors on the record for the defendants to M & K Lawyers, he was the solicitor responsible for the preparation of the Supplementary Affidavit of Documents;
· the Supplementary Affidavit of Documents was prepared and affirmed prior to receipt of the affidavit of Mr Rickard, the solicitor for the plaintiff, which exhibited the letter already supplied;
· that letter and the document numbered 99 over which privilege was claimed in the Supplementary Affidavit of Documents (‘Document 99’) are the same document;
· he was not aware at the time he prepared the Supplementary Affidavit of Documents that Document 99 had been provided pursuant to the defendants’ initial affidavit of documents;
· on further consideration he believes that ‘it is arguable’ that Document 99 is not confidential;
· document numbered 92 over which privilege was claimed in the Supplementary Affidavit of Documents (‘ Document 92’) had also already been partially disclosed; and
· the defendants no longer claim that Document 99, the already disclosed portion of Document 92, and the document numbered 91 over which privilege was claimed in the Supplementary Affidavit of Documents (‘Document 91’) are confidential.[5]
[5]Affidavit of Nicholas John Hardie Allen sworn 7 December 2016.
In the accompanying written submissions,[6] the defendants make it plain that they do not claim that Document 99 was disclosed in error. They assert that even if privileged and disclosed, that disclosure does not require production pursuant to s 126 of the Evidence Act 2008 (Vic) of other privileged documents merely because those other documents relate to the same subject matter as Document 99. In the alternative, the defendants submit that s 126 does not apply because Document 99 was not confidential, and so not privileged. By this alternative submission, the defendants seek to re-open their own case on privilege on which I had already ruled.[7]
[6]Defendants’ Submissions Re Document 99 dated 7 December 2016.
[7]This is made even plainer by the Defendants’ Points of Clarification, unsolicited submissions in reply dated 15 December 2016 at [1(b)].
The plaintiff in his further submissions[8] is critical of the defendants’ change of position in relation to Documents 91, 92 and 99, noting that this ‘calls into question the previous affidavits on which the Defendant (sic) sought to rely, asserting that privilege may not have been properly claimed in relation to those documents’.[9] The plaintiff does not, however, make his position in relation to re-opening of the question of privilege entirely clear in these further submissions. He asserts that ‘(i)t is too late for the Defendant to change its position and argue that privilege “may not have been” properly claimed’[10]. This would suggest that the ruling as to privilege should not be re-opened, and the defendants should suffer any consequences that then flow from disclosure of a document or documents ruled privileged. Shortly after this statement, however, the plaintiff submits in his further submissions that the Court should now examine the documents held to be privileged to determine ‘whether they have, in fact, been properly described as “estate planning” and the claim for privilege properly described/claimed.’[11] The plaintiff does not seek access to documents created for the purpose of defending this proceeding or content relating to John’s wills that does not concern the ownership of the Orana Park Property, its purchase, or the preparation and execution of all Deeds of Variation of Trust. [12]
[8]Plaintiff’s Submissions: Waiver dated 14 December 2016.
[9]Ibid, at [2].
[10]At [14].
[11]At [17].
[12]At [35]. The plaintiff says that he does not seek access to ‘content otherwise relating to the Second Defendant’s Wills’. I assume this is intended to a reference to the wills of the first defendant, not the second, in so far as they relate to matters other than the identified matters.
Should the question of privilege be re-opened?
I caused the view to be expressed in an email to the parties from my associate dated 22 December 2016 that, subject to submissions to the contrary, I considered that the defendants had re-opened the question of privilege. The notification in the email continued that, subject to objection, I proposed to ‘inspect the documents over which privilege is still claimed’. The email did not identify the purpose of that inspection, whether as part of a re-opened question of privilege or solely in relation to waiver.
Neither party objected to the characterisation given in the email of what had occurred, or to my inspection of the documents over which privilege was still claimed in the Supplementary Affidavit of Documents. I have now given further detailed consideration to whether or not the question of privilege should be re-opened.
A useful starting point is the decision of Hargrave J in Tenth Vandy Pty Ltd v Natwest Markets Australia Pty Ltd (‘Tenth Vandy’) [13] In that case, Hargrave J rejected an argument that he was bound to find that a second reinstatement application, following rejection of the same party’s earlier application for reinstatement, was an abuse of process unless there was new evidence, being evidence not available at the time of the first reinstatement application. Hargrave J reviewed the authorities to that date, including New South Wales and Victorian Court of Appeal authority and held that :
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.”[14]
[13]{2006] VSC 170.
[14]At [46] citing two decisions of the Court of Appeal of New South Wales, National Parks and Wildlife Service v Pierson (2002) 55 NSWLR 315 at 318 and Nominal Defendant v Manning (2002) 50 NSWLR 139 at 161.
Tenth Vandy has been cited and relied upon in many subsequent judgments of this and other courts, and not disapproved.[15] Thus the question is whether the interests of justice require the question of privilege to be re-opened, and, if so, to what extent. In determining this issue, I take into account the following matters.
[15]See, for example, Derham AsJ in Heckler v Koch GmbH v Faxtech Pty Ltd [2016] VSC 697 at [76] and rulings by Daly AsJ in the Oswal matters at [2017] VSC 19 at [34] (both of which concern the re-opening of privilege issues). In Melbourne City Investments Pty Ltd v Leighton Holdings Limited [2015] VSCA 235 the Court of Appeal approved the decision of the trial judge, relying in part on Tenth Vandy, to allow a second application for stay, over objection that it was an abuse of process.
First, it is for the holder of the privilege to make that claim. Thus, it is neither practicable nor conceptually sound to hold the defendants to a claim of privilege that they no longer press in respect of certain documents.
As against this, a consideration that does not support allowing the defendants to retract their privilege claim in respect of certain documents is that by doing so they may be seeking to avoid the consequences that might flow from disclosure of those documents, if privileged. As the circumstances that led to their change of position are entirely within the defendants’ camp, allowing them to avoid the consequences of disclosure of privileged documents could be unjust to the plaintiff.
However, as against this, the plaintiff also appears to seek that the entire question of privilege be re-opened, on the basis of the defendants’ change of position. Accordingly, the plaintiff must be taken to accept any adverse consequences that may flow to him if I accept the defendants’ change of position in relation to the disclosed documents.
A further relevant factor is that my ruling in relation to privilege was not dispositive of a distinct application, but rather an attempt to deal with the issues within the one summons in a logical manner. This also supports re-opening the question.
The circumstances in which the defendants now seek to withdraw their claims of privilege in respect of certain documents are also important. There is no new evidence, in the sense of evidence that was not available at the time of the earlier ruling, to justify or explain the change. The current solicitors for the defendants should have checked whether some documents had already been disclosed when preparing the Supplementary Affidavit of Documents; Ms Tyson as the solicitor with the conduct of the proceeding for the defendants at the time of their initial affidavit of documents should have been alive to this possibility when preparing her affidavit of 11 November 2016, and revealed any such prior disclosure; and, perhaps, the first defendant should have checked what had already been disclosed when swearing the Supplementary Affidavit of Documents. Counsel for the defendants could, and arguably should, have cross checked the documents and made the concessions now made about Documents 91, 92 and 99, prior to the Court ruling on privilege.
The fault is not all one way, however. Counsel for the plaintiff could have noted the apparent identity between Document 99 and a document already disclosed when arguing against privilege, and not only after the ruling on privilege had been given.
Finally, I respectively agree with the observations of Daly AsJ in her rulings on re-litigation of privilege issues in relation to the Oswal trial,[16] that given the importance of client legal privilege there should not be strict limitations placed on the circumstances in which privilege can be challenged, or, as here, re-litigated.
[16]Oswal trial rulings, [2017] VSC 19 at [41].
The defendants seek to limit their change of position to certain documents only. In my view, this is not tenable. I agree with the plaintiff that by doing so they cast doubt on the whole of the evidence previously given to support the claim of privilege. Accordingly, if the question of privilege of Documents 91, 92 and 99 is re-opened, then so is the claim for privilege over all the other documents in the Supplementary Affidavit of Documents.
For these reasons, I confirm the preliminary view as conveyed by my associate that the question of privilege has been re-opened, and the re-opened issue is not confined to the status of Documents 91, 92, and 99.
What documents are to be inspected
The plaintiff seeks that the defendants supply for my inspection not just the documents identified in the Supplementary Affidavit of Documents over which privilege was claimed, but also the documents claimed to be privileged in the initial affidavit of documents. The defendants take the point that the summons is limited to the Supplementary Affidavit of Documents.
In my view, the defendants are correct. The plaintiff’s summons seeks production of documents claimed to be privileged in the Supplementary Affidavit of Documents only. It does not refer to the claim for privilege in the initial affidavit, although this was the subject of correspondence between the parties prior to the plaintiff’s first discovery summons.[17] The current summons confines the scope of the application. Accordingly, it was in December 2016 and remains my intention to inspect only the documents claimed to be privileged in the Supplementary Affidavit of Documents.
[17]Affidavit of Trevor John Rickard sworn 4 May 2016.
How privilege and waiver will be determined
I will rule on the claim for privilege made by the defendants in respect of the documents listed in Part 2 of Schedule 1 of the Supplementary Affidavit of Documents, and the plaintiff’s objection to privilege or assertion of waiver in respect of certain documents on the basis of all the affidavits filed relating to the question, all the submissions and my inspection of the documents. I exclude from my assessment of privilege and waiver the documents that the plaintiff does not seek be produced i.e. those that are identified by Ms Tyson has having been created in contemplation of this proceeding or that relate to the disposition of John’s personal assets other than his shares in the second defendant.
Summary of conclusions
On the more detailed assessment of the question of privilege that is now required, I depart from my earlier conclusions substantially, and to a considerable degree because on closer scrutiny of the evidence in support of the claim for privilege I do not consider that the formal claim for privilege made by the second defendant in the Supplementary Affidavit of Documents is made out.
I set out the documents or portions of documents that I consider should be produced, either because they are not privileged or because that privilege has been waived, in the section of this judgment headed ‘Application of principles to this case’ and in the attached Annexure. In total, I consider that 24 documents or part documents should be produced, of the 58 documents that remained in contention (73 initially claimed to be privileged, minus 13 where the claim was not challenged and two subsequently disclosed in full).
Issues
To understand the issues in this application it is first important to understand the issues in the proceeding. To identify these, I have considered the statement of claim and defence, the further and better particulars supplied by Andrew, Andrew’s Notice to Admit filed 12 July 2016 and the defendants’ Notice of Dispute filed 26 July 2016.[18]
[18]There is also a counterclaim by the second defendant, which has not been adverted to in this application.
Issues in the proceeding
The Trust
Andrew alleges that the Trust was established by a Deed of Settlement dated 11 June 1993 and that pursuant to this Deed John was the appointor of the Trust (‘Appointor’ or ‘Appointors’ as the case requires) during his life, and on his death his nephews Andrew, Paul and Mark jointly were to become the Appointors.
A copy of the Deed of Settlement was made available to me. The parties did not address me on its provisions, but on inspection the Deed of Settlement appears to create a discretionary trust in respect of the ‘Trust Fund’ in favour of a number of beneficiaries, including John, his brother Gerard (the late father of Andrew), Maria Lamers, Andrew, Paul Lamers and Mark Lamers. The Trust Fund is defined to include the ‘settled sum’ paid by the settlor to the trustee and other property transferred to and accepted by the trustee ‘as additions to the Trust Fund’. The settlor of the Trust is named as John Barlow; the settled sum is identified as $50; and the trustee named in the Deed of Settlement is Thibbley Pty Ltd. The Deed of Settlement provides by clause 19 that the Appointor may nominate an Appointor and may appoint a new or additional trustee, or remove a trustee.
The parties have not addressed me on the significance or otherwise of who is Appointor, but examination of the Deed of Settlement would suggest that it is the Appointor who ultimately controls the assets of the Trust. This is because although control of the assets is vested in the trustee, the Appointor may appoint or remove the trustee.
The defendants have denied some aspects of the plaintiff’s allegation in the statement of claim, but the creation of the Trust, that Andrew and John are amongst the beneficiaries, and that pursuant to the Deed John was Appointor during his life and Andrew, Paul and Mark Appointors on his death is not denied.[19]
[19]Statement of claim and defence, each at [3].
Andrew alleges that by a Deed of Appointment and Variation executed on or about 15 April 1999, changes were made including that the second defendant became trustee of the Trust and, significantly, that on John’s death, Andrew was to become Appointor. These allegations are admitted.[20] A copy of this Deed of Appointment and Variation as executed was made available to me. It appears to be executed on behalf of the second defendant by Andrew as a director, and his late father Gerard as secretary.
[20]Statement of claim and defence, each at [5].
The parties agree that there was a subsequent Deed of Variation to the Trust, executed by the second defendant, on or about 10 October 2000. They do not, however, agree on its terms or effect, or that it was prepared by Mr Barlow. Andrew contends that the Deed provides that if Andrew meets two conditions as pleaded then with effect from 15 April 1999 Andrew was to become the Appointor of the Trust on John’s death.[21] The defendants admit execution of the Deed, do not admit that it was prepared by Mr Barlow, deny that it took effect as from 15 April 1999, do not admit that the pleaded terms are its terms and otherwise refer to the Deed itself as to its terms.[22] The Deed of Variation of Trust is exhibited to the affidavit in support of Andrew’s summons.[23] From a preliminary inspection, it may have an extra condition that Andrew was required to satisfy to become appointor on John’s death which is not pleaded. This Deed appears to have been executed on behalf of the second defendant by Andrew as director and John as secretary.
[21]Statement of claim at [6] and Notice to Admit at A[2]-[3].
[22]Defence at [6] and Notice of Dispute at [3].
[23]Exhibit TJR-46 to the affidavit of Trevor Rickard sworn 19 August 2016.
The Trust has been subsequently varied, or purported to be varied, in terms which no longer provide for Andrew to become Appointor on John’s death.[24] Counsel for Andrew has flagged that Andrew may seek to amend his statement of claim to add further relief in respect of these later variations. The Deed of Variation of the Trust dated 13 June 2014 provides in its typed form that it be executed on behalf of the second defendant by both John and Andrew as directors, and, in the case of Andrew, also as secretary, but the executed copy in evidence is executed only by John.
[24]Deeds of Variation dated 13 June 2014 and Deeds of Appointment dated 28 August 2014, 11 December 2014, 18 December 2014 and 16 October 2015, collectively marked Exhibit A in the plaintiff’s case as at 25 November 2016.
In addition to responding to the allegations made about the Trust, the defendants assert that the Trust is irrelevant to the proceeding.[25]
[25]Defence at [18], [21] and [22].
Trust Representations
Andrew alleges in his statement of claim that Mr Barlow told him on each of the occasions of the 1999 and 2000 variations to the Trust i.e. on or about 15 April 1999 and on or about 10 October 2000, that he, Andrew, would become the sole Appointer under the Trust provided that he met certain conditions and as a result he would ‘effectively inherit’ a property (‘the Orana Park Property’), of which the second defendant is the registered proprietor[26]. He refers to these representations as ‘the Trust Representations’.
[26]Statement of claim at [7].
The defendants deny the allegations; assert that the phrase ‘effectively inherit’ ought to be struck out; and also deny the allegation ‘that John Barlow made representations to Andrew on behalf of John.’[27] It is not entirely clear what this denial means, although coupled as it is with the general denial and given the pleaded basis of the assertion made by the defendants as to the capacity in which the second defendant owns the Orana Park Property, to which I will refer shortly, I take it to be a positive assertion that if representations were made by Mr Barlow to Andrew, he did so without authority.
[27]Defence at [7].
Andrew has also sought admissions by his Notice to Admit from the defendants of facts relating to the Trust Representations, including the fact that Mr Barlow made these representations on the instructions and with the authority of John. John disputes all these facts in his Notice of Dispute.
The Orana Park Property
The parties agree that the Orana Park Property, a farming property at Leongatha, was purchased on or about 15 December 1998. They disagree as to whether or not it was purchased by the second defendant. Andrew has pleaded that it was but the defendants contend that the contract for sale was executed by John; the second defendant was not ‘registered’ (it is not clear to me whether by this they mean incorporated) until 13 April 1999; after that date but before settlement John nominated the second defendant as substitute purchaser; and the second defendant became registered proprietor of the Orana Park Property on settlement.[28]
[28]Statement of claim and defence, each at [8].
Andrew and John are the only shareholders in the second defendant- Andrew holding one of the six issued shares, and John five.[29] Both are directors.
[29]Statement of claim and defence, each at [2].
One of the issues in the case is whether the second defendant owns the Orana Park Property in its own right or as trustee of the Trust, in which case it is an asset of the Trust. In his statement of claim Andrew seeks to plead both, in the alternative.[30] In his Notice to Admit, he seeks three admissions in relation to the capacity in which the second defendant owns the Orana Park Property. First, that the second defendant purchased the Orana Park Property as trustee. Secondly, that on or about 7 August 2014 Mr Barlow as solicitor for John represented to Andrew that the Orana Park Property was owned by the second defendant solely as trustee, and thirdly that Mr Barlow prepared a file note of his attendance on Andrew and his wife to this effect.[31]
[30]Statement of claim at [9].
[31]Notice to Admit at A [1] and [7], and B [1].
In their defence, the defendants deny that the Orana Park Property is owned by the second defendant as trustee of the Trust and admit that it is owned by the second defendant in its own capacity. They go further and put a positive case that it is owned by the second defendant in its own capacity.[32] Further still, the defendants also assert in their defence as follows:
If John Barlow made any representation (which is denied) that the Orana Park Property was held by the Second Defendant on trust for the John Lamers Family Trust, such representation was made without the First or Second Defendants’ actual or ostensible authority.[33]
[32]Defence at [9(a)(i)-((viii)], and Notice of Dispute at [1].
[33]Defence at [9(a)(ix)].
Consistently with this stance, the defendants dispute all three of the alleged facts relating to the capacity in which the second defendant owns the Orana Park Property, or representations as to that capacity, as put in the Notice to Admit. Andrew relies on the positive assertion of lack of authority in the defence as constituting action by the defendants inconsistent with the maintenance of their claimed privilege.
Will Representations
Andrew seeks admissions in his Notice to Admit that at the time of the October 2000 variation to the Trust, John also instructed his solicitors, Birch Ross & Barlow, to prepare a will leaving all his shares in the second defendant to Andrew on his death, and on or about 10 October 2000 executed a will in those terms, as well as the variation. John admits that he executed a will as well as a Deed of Variation dated 10 October 2000, but otherwise disputes the alleged facts. The will in question is exhibited in full to the affidavit in support of Andrew’s summons and does indeed by clause 3 bequeath all of John’s shares in the second defendant to Andrew.[34]
[34]Exhibit TJR-45 to the affidavit of Trevor Rickard sworn 19 August 2016.
John has provided to Andrew copies of wills he has executed dating from 1995 to 2015. The degree to which those wills could properly be redacted was the subject of an earlier application by the plaintiff and a ruling by me on 24 May 2016. In short, I ruled that portions of the wills that did not relate to John’s shares in the second defendant could be redacted. As a consequence, Andrew is in possession of subsequent wills in so far as they provide for John’s shares in the second defendant on his death. John has varied his will on a number of occasions after 2000 in relation to the disposition of his shares in the second defendant. In particular, in a will dated 9 May 2006 he reduced his gift of his shares to Andrew from all five, to three.[35] The parties have not taken me in this application to later wills and their provision in relation to the shares.
[35]Affidavit of Trevor Rickard sworn 19 August 2016 at [8].
Andrew alleges in his statement of claim that John represented to him on 16 July 2012 that his will provided that Andrew would receive two of John’s shares in the second defendant on his death, the balance being bequeathed to his nieces and nephews.[36] Andrew refers to this representation as ‘the Will Representations’. Andrew has sought admission by the defendants that John made the representation as to the additional two shares on his death by his Notice to Admit. The defendants deny the allegations in the statement of claim, and dispute the alleged fact.[37]
[36]Statement of claim at [14].
[37]Defence at [7] and [14] and Notice of Dispute at [1].
Joint Endeavour
There are also allegations by Andrew that he, John and Andrew’s late father Gerard, had a shared intention immediately following the purchase of the Orana Park Property to operate a dairy farm over land comprising the Orana Park Property and other properties that ultimately came to be owned personally by Andrew, and that as part of this ‘Joint Endeavour’ Andrew would one day inherit the Orana Park Property.[38] The defendants deny these allegations. They put a different case, that the agreement was between John and Gerard by way of joint venture; that Andrew initially worked in the operation and lived with his family in the house at the Orana Park Property as a licensee of the second defendant; that subsequently, on or about 1 July 1999, Andrew became a tenant of the second defendant; and that in or about November 2014 the defendants rejected a proposal advanced to them by Andrew for the future conduct of the operation and occupation of the house at the Orana Park Property.[39] The parties have not taken me to these allegations in this application.
[38]Statement of claim at [11]-[13].
[39]Defence [11]-[13].
Reliance, detriment and relief sought
Andrew alleges reliance to his detriment on the Trust Representations, the Joint Endeavour and the Will Representations.[40] In his Notice to Admit he seeks an admission of various contributions alleged to have been made by him and his wife. The defendants in their defence deny the allegations of reliance and detriment (objection is also taken to the pleading), and advance an alternative case.[41] In their Notice of Dispute they dispute the alleged contributions. Neither party has relied on this aspect of the proceeding in this application.
[40]Statement of claim at [15]-[17], [19]-[20].
[41]Defence [15]-[17],[19]-[20.
Andrew alleges that he and John had a common intention that:
Andrew would assume control of the John Lamers Family Trust upon the death of John… and/or Andrew would be bequeathed an additional 2 shares in (the second defendant) following the death of John[42]
and that the defendants have subsequently denied that he, Andrew, has any interest in the Orana Park Property, the Trust or the shares in the second defendant registered in John’s name.[43] He asserts that it would be unconscionable for the defendants to deny him these interests, and that they are estopped from doing so.[44]
[42]Statement of claim at [18].
[43]Statement of claim at [21].
[44]Statement of claim at [22].
The defendants deny the common intention. They admit that they have denied that Andrew has any interest in the Orana Park Property or the shares in the second defendant in John’s name. They deny that they have denied that Andrew has any interest in the Trust, asserting that Andrew is a beneficiary of the Trust, but assert that the Trust is in any event ‘irrelevant’ in the proceeding.[45] They deny the allegation of unconscionability, and also assert a positive case as to why their actions are not unconscionable.[46]
[45]Defence at [18] and [21].
[46]Defence at [22].
Andrew asserts that the second defendant holds ‘all or part of the (Orana Park) Property’ as trustee of the Trust pursuant to the variations to the trust executed on or about 15 April 1999 or 10 October 2000; ‘and/or’ on constructive trust for itself and Andrew, and seeks equitable relief in relation to the Orana Park Property and/or two of John’s shares in the second defendant. The defendants deny these allegations, and further assert that any equitable relief should allow for the contributions made by John, the interests of the other beneficiaries of the Trust (if the Trust is relevant, which is denied), benefits that have flowed to Andrew from increase in value of his own properties and from the dairy farming operation on the Orana Park Property.[47]
[47]Statement of claim and defence, each at [23] and [24].
Issues in the application
Andrew objects to the claim for privilege in respect of certain documents and asserts that the defendants have waived their privilege in certain documents in the following terms in the plaintiff’s last submissions:
The Plaintiff submits that it (sic) should be given access to documents relating to ownership of the (Orana Park Property) by the John Lamers Family Trust, the purchase of the (Orana Park Property) and the preparation and execution of all Deeds of Variation of Trust and in particular those referred to in paragraphs 5 and 6 of the Statement of Claim which form the basis of the representations set out in paragraph 7 of the Statement of Claim. For the avoidance of doubt, this does not extend to content otherwise relating to the Second Defendant’s (sic) Wills or documents created for the purpose of defending this proceeding.[48]
[48]Plaintiff’s Submissions: Waiver dated 14 December 2016 at [35].
Issues on privilege
Andrew’s contentions at the outset of the hearing were that there was no evidence to support the claims for privilege in the Supplementary Affidavit of Documents and, in particular that the descriptions of the documents in the Supplementary Affidavit itself were inadequate to substantiate the claim. Ms Tyson then swore her affidavit of 11 November 2016 in which she sought to substantiate the claims for privilege on the basis that the documents over which privilege was claimed relate to ‘estate planning work’ for John in relation to how he ‘intends to deal with his personal assets following his death’. Andrew’s counsel objected to the use of the phrase ‘estate planning work’ but over this objection I ruled on 15 November 2016 that it was a sufficient descriptor, and the claims for privilege were upheld provided dates were given for undated documents.
Following the defendants’ withdrawal of their claim for privilege in respect of some documents Andrew renews his objection to the accuracy of the descriptor ‘estate planning’ and submits that it appears to have been used in relation to matters other than the personal assets of John. On further scrutiny of Document 99 and the use of the term ‘estate planning’ in Ms Tyson’s affidavit of 11 November 2016, I now agree.
In her affidavit of 11 November 2016 Ms Tyson grouped the documents over which the claim of privilege is now withdrawn, or partially withdrawn, including Document 99, as her Group 6. She said that the purpose of all three communications was to advise John as to ‘his personal assets and interests and his estate planning affairs’.[49] Examination of Document 99 shows, however, that Ms Tyson’s enquiries in the letter do not relate to assets described by her in the letter as being personal assets of John. Rather, she describes the assets in the letter as being the assets of the Trust. Thus Ms Tyson uses in her affidavit the descriptor ‘estate planning’ in relation to assets which she herself was of the view were not personal assets of John. This misdescription calls into question whether the other documents said by Ms Tyson to relate to personal assets of John, and so of a confidential character, are properly so described.
[49]At [47] and [49] of the affidavit.
A further issue that arises on re-opening of the challenge to privilege is whether documents related to documents no longer claimed to be confidential (and so not privileged) can now properly be described as confidential, which is a necessary pre-condition for the claim of privilege.
Issues on waiver
The conduct on which Andrew relies to assert waiver falls into two categories as follows. I have compiled this list from both the original and further written submissions and the oral submissions of his counsel.
(a) Denials and assertions in the defence and notice of dispute (‘issue waiver’)
The denials and assertions which counsel for Andrew submits waive privilege are as follows:
(i) The denials in paragraphs 7 and 9 of the defence.
(ii) The assertion in paragraph 9(a)(vii) of the defence that ‘at no time has the Orana Park Property, or income or expenditure associated with the Orana Park Property, been treated separately from other assets, income or expenditure of the Second Defendant’.[50]
[50]Counsel for the plaintiff raises this matter for the first time in his further submissions, following disclosure of Documents 91 and 92.
(iii) The assertion in paragraph 9(a)(ix) of the defence that if Mr Barlow made any representation to the effect that the Property was held by the second defendant as trustee for the Trust, such representation was made without the actual or ostensible authority of the defendants.
(iv)Denials in the Notice of Dispute to asserted facts and to the authenticity of the file note, which is listed at (iii) below .
(b) Supply to Andrew of certain documents (‘disclosure waiver’)
The documents the supply of which Andrew asserts is inconsistent with the maintenance of privilege in other documents are as follows:
(i) Provision in discovery of letter dated 3 July 2014 from Ms Tyson of Birch Ross & Barlow to Westaway Bolge, accountants, enclosing a Deed of Variation for signature by Andrew.[51]
[51]Exhibit TJR-47 to the affidavit of Trevor Rickard sworn 19 August 2016.
(ii) Provision in discovery of an appointment book entry confirming an appointment for Andrew to attend upon Mr Barlow on 7 August 2014.[52]
[52]Exhibit TJR-48 to the affidavit of Trevor Rickard sworn 19 August 2016.
(iii) Subsequent provision on request of a file note by Mr Barlow of his attendance on Andrew and his wife on 7 August 2014, which states that the second defendant is the trustee for the Trust and ‘holds no assets in its own right’[53].
[53]Exhibit TJR-49 to the affidavit of Trevor Rickard sworn 19 August 2016.
(iv) Recent provision of Documents 91 and 92 (the latter still only in redacted form)[54] being a letter by Ms Tyson of Birch Ross & Barlow dated 2 September 2014 to Alex Scott and Staff and their reply of 17 September 2014.
[54]Plaintiff’s Submissions: Waiver dated 14 December 2016 at [29] and [35]. The redacted Document 92 appears to have been discovered as item 22(f) of Part 1 of Schedule 1 of the defendants’ initial affidavit of documents sworn 15 January 2016.
(v) Provision in earlier discovery of Document 99, which is a letter from Ms Tyson of Birch Ross & Barlow to accountants Westaway Bolge dated 9 December 2014. The letter, amongst other things, enquires ‘what monies are owing to Orana Park Pty Ltd as trustee for The John Lamers Family Trust by Andrew for rental’ and if the accountants have details of contributions by John and Andrew to ‘the development of the farming property owned by Orana Park Pty Ltd as trustee for The John Lamers Family Trust’.[55]
[55]Exhibit TJR-50 to the affidavit of Trevor Rickard sworn 19 August 2016. This would appear to be item 11(ee) of Part 1 of Schedule 1 to the defendants’ initial affidavit of documents.
(vi) Birch Ross & Barlow letter signed by Ms Tyson to Andrew and his wife dated 16 February 2015[56] which requests that Andrew take action to allow John to access rental monies held in a bank account.
[56]Exhibit TJR-51 to the affidavit of Trevor Rickard sworn 19 August 2016.
(vii) Provision in discovery of a letter from Ms Tyson of Birch Ross & Barlow to Westaway Bolge dated 20 May 2015 which states amongst other things ‘whilst the property known as “Orana Park” has been treated as an asset of the company, it had been our view that the property was owned by the company in its capacity as trustee for The John Lamers Family Trust’. The letter then sets out the writer (Ms Tyson’s) understanding of initial contributions to the purchase of the Property and asks the accountant to ring her to discuss.[57]
(viii) Provision of the documents evidencing change to the Trust and its appointor on John’s death, being the Deed of Variation dated 13 June 2014; and Deeds of Appointment dated 28 August 2014, 11 December 2014, 18 December 2014 and 16 October 2015.[58]
[57]Exhibit TJT-52 to the affidavit of Trevor Rickard sworn 19 August 2016.
[58]These were initially produced in redacted form only, but later unredacted. Collectively, they are marked Exhibit A in the plaintiff’s case on 25 November 2016.
The thrust of the submissions of counsel for the plaintiff is that the documents already disclosed relate to three matters - whether the Orana Park Property is owned by the second defendant in its own right or as trustee of the John Lamers Family Trust; the denials of the representations by John Barlow on which Andrew says he relied; and the various variations to the Trust. I will assume that Andrew relies on supply of the documents (i), (iii), (iv), (v), (vi) and (vii) because their content refers to or implies the capacity in which the second defendant holds the Orana Park Property. For example, the document in (i) refers to ‘the transfer of lands owned by The Lamers Family Trust’. I will assume that Andrew relies on the supply of documents (ii) and (iii) in relation to the other contentious issue identified by Mr Rickard, being whether or not Mr Barlow did, at an earlier point in time, make any of the claimed representations to Andrew and, if he did, whether he was authorised to do so.
Counsel for the plaintiff appears to relate provision of the Trust documents in (viii) to the question as to whether the first defendant has resiled from the claimed common intention and his state of mind generally.[59] The documents show that the first defendant has changed his mind as to who is to be Appointor of the Trust on his death, but as noted earlier, no relief is currently sought in respect of the changes to the Trust. Plainly, however, as the defendants have now disclosed all the Trust documents they concede that they are relevant (notwithstanding their stance in the pleading that the Trust is irrelevant). The disclosed documents reveal the concluded form of any advice given to John in relation to who is to be Appointor on his death, which as I set out later I regard sufficiently falls within the confidentiality to be afforded to him in relation to the disposition of his personal assets on death. It follows that the disclosure of the Trust documents can only trigger further disclosure by reason of waiver.
[59]Plaintiff’s Outline of Submissions dated 31 October 2016 at [9(c)].
The defendants cannot and do not deny any of the alleged conduct. It plainly has occurred. They submit, however, that none of the conduct constitutes acting inconsistently with the maintenance of privilege in the remaining documents. If I am against them in relation to the positive case asserted by paragraph 9(a)(ix) of their defence, they propose a limited scope to the privilege documents in respect of which the privilege has been waived as a result of that positive case. The defendants did not respond to the plaintiff’s reliance on paragraph 9(a)(vii) of the defence in the plaintiff’s further submissions. I will treat this sub-paragraph in conjunction with the other sub-paragraphs of paragraph 9(a) as asserting a positive case that the second defendant owns the Orana Park Property in its own right i.e. as relating to issue waiver.
I now turn to the relevant legal principles.
Legal principles concerning client legal privilege
Privilege
Privilege in respect of communications between a client, here relevantly one or both of the defendants, and their lawyers, Birch Ross & Barlow, may be claimed pursuant to ss 118 or 119 of the Evidence Act 2008 (Vic) (‘Evidence Act’). Section 131A applies those sections to interlocutory procedures such as discovery as well as to the giving of evidence.
Section 118 (legal advice privilege) requires in its terms that the party claiming the privilege show:
· an objection by the client to production;
· that the communication was confidential; and
· that the dominant purpose of the communication was the provision of legal advice to the client.
Section 119 (litigation privilege) requires in its terms that the party claiming the privilege show:
· an objection by the client to production;
· that the communication as between the client and another person, or between the lawyer and another person or document was confidential; and
· was prepared for the dominant purpose of the client being provided with professional legal services relating to either the subject or another proceeding, in Australia or elsewhere, whether already commenced or anticipated, in which the client is or may be a party.
As set out earlier, the question of privilege has now been re-opened by the defendants’ change of position in relation to certain documents earlier claimed to be privileged. I do not apprehend, however, any dispute between the parties as to the principles that apply to the determination of privilege.
Waiver
To the extent that I now uphold the claim of privilege in respect of any documents other than those created for this proceeding, Andrew contends that the privilege in respect of some or all of those documents has been lost by virtue of s 122 and s 126 of the Evidence Act. The key aspects of s 122 in this application are sub-sections (2) and (3) which provide:
122Loss of client legal privilege—consent and related matters
(1)(Not relevant)
(2)Subject to subsection (5), this Division does not prevent the adducing of evidence if the client or party concerned has acted in a way that is inconsistent with the client or party objecting to the adducing of the evidence because it would result in a disclosure of a kind referred to in section 118, 119 or 120.
(3)Without limiting subsection (2), a client or party is taken to have so acted if—
(a)the client or party knowingly and voluntarily disclosed the substance of the evidence to another person; or
(b)the substance of the evidence has been disclosed with the express or implied consent of the client or party.
(4)(Not relevant)
(5)(Not relevant)
(6)(Not relevant)
Section 126 provides:
126Loss of client legal privilege—related communications and documents
If, because of the application of section 121, 122, 123, 124 or 125, this Division does not prevent the adducing of evidence of a communication or the contents of a document, those sections do not prevent the adducing of evidence of another communication or document if it is reasonably necessary to enable a proper understanding of the communication or document.
Points of disagreement in relation to waiver
The parties disagree as to two aspects of the principles relating to loss of privilege pursuant to ss 122 and 126. The first point of disagreement, at least initial disagreement, is whether a bare denial of an allegation by one party can amount to waiver of privilege in documents that may tend to support that allegation. This relates to issue waiver. I say this was possibly only initial disagreement because on 15 November 2016 counsel for Andrew conceded that a bare denial by the party claiming privilege of an allegation by the other party does not amount to inconsistent action so as to waive the privilege.[60] For completeness I will deal with that issue.
[60]Transcript of 15 November 2016, at p 12 ll 2-10.
The second point of disagreement is whether s 126 can apply to cause loss of privilege in privileged documents when the documents that have been disclosed are not privileged. Some of the documents that have been disclosed by the defendants are no longer claimed to be privileged. The defendants say that their disclosure cannot therefore trigger disclosure of other documents, over which privilege is still claimed, under s 126, because that section only applies where the disclosed document was privileged and lost that privilege by virtue of, in this case, s 122.
Discussion
The principles that apply to disclosure waiver, issue waiver and ‘derivative’ waiver, i.e. waiver pursuant to s 126 of the Evidence Act, were conveniently summarised by J Forrest J in his recent ruling Mullet v Nixon & Ors (Subpoena Application) (‘Mullet v Nixon’).[61] He began[62] by noting that s 122(2) of the Evidence Act reflects the common law position stated by the High Court in Mann v Carnell in their words:
What brings about the waiver is the inconsistency, which the courts, where necessary informed by considerations of fairness, perceive, between the conduct of the client and maintenance of the confidentiality; not some overriding principle of fairness operating at large.[63]
[61][2016] VSC 129. See also the succinct, but not exhaustive, statement of principles by Elliot J in IOOF Holdings Ltd v Maurice Blackburn Pty Ltd [2016] VSC 311 at [48].
[62]Ibid, at [21].
[63]Mann v Carnell (1999) 201 CLR 1; [1999] HCA 66 per Gleeson CJ, Gaudron, Gummow and Callinan JJ at [29].
Further helpful analysis of the test as propounded by the High Court in Mann v Carnell is provided by Derham AsJ in Matthews v SPI Electricity Pty Ltd,[64] other aspects of which were cited by J Forrest J in Mullet v Nixon with approval. Derham AsJ noted (emphasis in italics added) that:
So, under the test propounded in Mann v Carnell it is inconsistency between the conduct of the client and the maintenance of the confidentiality that the privilege is intended to protect which effects a waiver of the privilege. The test for imputed waiver had previously been expressed in terms of fairness: see Attorney-General (NT) v Maurice (1986) 161 CLR 475 (‘Maurice’) at 481 per Gibbs CJ, 487–8 per Mason and Brennan JJ, 492–3 per Deane J, and 497–8 per Dawson J. Fairness has become a subsidiary consideration; it may be relevant to the court’s assessment of inconsistency in some contexts but not in others.[65]
[64][2013] VSC 33 at [42].
[65]Ibid at [37] citing AWB Limited v Cole (No 5) (2006) ALR 651; [2006] FCA 1234 at [130] per Young J; Perhaps an ‘unfair inconsistency’: See also Byrne J in Liquorland (Australia) Pty Ltd v Anghie (2003) 7 VR 27, [41]
Returning to Mullet v Nixon, J Forrest J noted that disclosure waiver and issue waiver both fall under s 122 of the Evidence Act, and both are dependent on the existence of the requisite inconsistency which makes reliance on the privilege untenable.[66]
[66]Mullet v Nixon at [42].
In Mullet v Nixon, the case for disclosure waiver arose from reference in the media by the then Commissioner of Police, Ms Nixon, to having obtained legal advice prior to suspending the plaintiff. His Honour held that in doing so she had not acted inconsistently with the maintenance of confidentiality in the advice, as she did not refer to the ‘gist or substance of the advice’.
In relation to issue waiver, J Forrest J cited with approval statements of the test to apply from the following authorities: the judgment of the Full Federal Court in Commissioner of Taxation v Rio Tinto Ltd[67]; the judgment of Allsop J in DSE (Holdings) Pty Ltd v InterTan Inc[68] (‘DSE (Holdings)’) and the judgment of Hodgson JA in New South Wales Bar Association v Archer.[69] The extracts that he quotes from the latter two of these judgments relate to undue influence cases, but it is plain that J Forrest J did not regard the statement of the test as applicable only in that kind of case.
[67][2006] FCAFC 86 at [68].
[68][2003] FCA 384 at [58] and [52].
[69](2008) 72 NSWLR 236, at 251.
Both counsel in this case have taken me to the judgment of Allsop J in DSE (Holdings) and it is worth quoting the passage in which Allsop J deals with whether a mere denial is sufficient as follows (citation omitted):
The act of mere denial by the respondents of an assertion by the applicants is not an act by the respondents which expressly or impliedly makes an assertion about the contents of any privileged communication or which necessarily lays any such communication open to scrutiny. There is no act of the respondents inconsistent with the maintenance of the confidentiality. There is a joinder of issue on a question of fact to which the privileged communication can be seen as relevant. That is insufficient in my view for it to be concluded that there exists the necessary inconsistency enunciated by Mann v Carnell.
The effect of those statements of the test in relation to issue waiver is as follows. First, it must be the party asserting the privilege who makes the assertion, which may be express or implied, that is said to be inconsistent with the maintenance of privilege. There is no inconsistency if it is the other party who makes the assertion. Secondly, a mere denial of an assertion by the other party is not sufficient- a positive assertion is required. Thirdly, the positive assertion must put in issue the contents of the documents over which privilege is claimed, or necessarily lay open the confidential communication to scrutiny, for issue waiver to arise. It is this that makes it inconsistent to maintain the confidentiality of the document. Fourthly, in determining whether a party has put a matter in issue, the Court is not confined to the pleadings. It may take into account, for example, the evidence as put and the steps taken in the conduct of the proceeding.
In relation to derivative waiver, J Forrest J noted, relevantly for this case, the following:[70]
[70]Mullet v Nixon [86]-[89].
· the statutory form contained within s 126 is different from the common law test, in that it ‘is not cast in terms of either unfairness or inconsistency (or for that matter, inconsistency informed by notions of unfairness’;[71]
[71]Ibid at [86] quoting Sugden v Sugden (2007) 70 NSWLWR 301; [2007] NSWCA 312 at [93].
· the test is an objective one;
· ‘one starts by looking at the substantive (J Forrest J calls this the ‘primary’) document (made admissible under s 122 or another of the applicable sections) and asking whether, in order to understand it thoroughly, it is necessary to know what is in the associated material’;[72]
· it is not necessary that the derivative document be referred to in the primary document, and, conversely, the fact that the document said to be derivative is referred to in the primary document does not necessarily mean that the privilege in the document said to be derivative is waived by s 126; and
· what is necessary is that the derivative document assists in reaching a proper understanding of the primary document.
[72]Mullet v Nixon at [88] quoting ML Ubase Holdings Co Ltd v Trigem Computer Inc (2007) 69 NSWLR 577; {2007} NSWSC 859 at [46].
Conclusion in relation to principles on waiver
I conclude that the following principles apply to the party’s competing contentions on waiver:
· The conduct which is said to be inconsistent with the maintenance of the privilege must be that of the party claiming the privilege.
· It follows that where privilege is asserted by a defendant, it is not enough that the defendant puts the allegation in issue, as a defendant is required in any event to respond to the plaintiff’s case. A bare denial by a defendant of an allegation by a plaintiff is not inconsistent with the maintenance by the defendant of privilege over documents relating to that allegation.
· The assertion of a positive case inconsistent with the contents of a privileged document may, however, constitute inconsistent conduct by virtue of which the privilege in that document is lost.
· Determination of the case of the party claiming the privilege asserts is not limited to the pleadings.
· It follows from the words of the section itself, and the authorities, that the further waiver that s 126 confers only applies where the disclosed document that is said to bring it into play was itself privileged.
Application of principles to this case
Privilege
As noted earlier, I exclude from reconsideration of the privilege issue those documents where the claim for privilege is not challenged, being those identified by Ms Tyson in paragraphs 17 (part of ‘Group 3’) and 19(h) (‘Group 8’) of her affidavit of 11 November 2016 as relating to advice ‘regarding this Proceeding’ or ‘subsequent to the current disputes with Andrew Lamers’. My scrutiny of the documents suggests that the documents Ms Tyson lists in those two categories may not be exhaustive as to the documents in respect of which litigation privilege could be claimed. One example is Document 117, but there are others. Ms Tyson includes this document in her Group 3, but does not include it in her paragraph 17 list of Group 3 documents relating to this proceeding, although the content could suggest otherwise.
It is not, however, for the Court to speculate. Evidence is required to support a claim for privilege under s 119 as well as a claim under s 118. Accordingly, I apply to the determination of the question of privilege only the confidentiality and dominant purpose identified by Ms Tyson, which is legal advice to John in relation to the disposition of his personal assets on his death. I uphold the claim for privilege in relation to Document 117 on that basis, not because it may have been susceptible to a claim for privilege under s 119.
Documents which do not relate to John’s personal assets
I identified earlier two principal issues that arise on the re-opened question of privilege. The first is whether on examination it appears that documents said by Ms Tyson to be confidential because they relate to John’s personal assets and the question of their disposition after his death, are in fact properly so described. If on scrutiny they are not, then there is no other basis on which legal advice privilege is supported. Ms Tyson does not depose that any of the documents were confidential to the second defendant, or that they relate to confidential legal advice given to John on any other topic, other than this proceeding i.e. litigation privilege.
I was informed by counsel for the defendants on 15 November 2016[73] that Ms Tyson used the term ‘estate planning’ to refer only to the disposition of personal assets of John on his death. As set out earlier, it appears she has applied it, at least in relation to Document 99, to communications that do not relate only to John’s personal assets. This issue arises in relation to three distinct areas of content.
[73]Transcript p 49 at ll 16-24.
First, this issue arises in relation to documents, or portions of documents, relating to the Trust. The assets of the Trust are not John’s personal assets. He is, however, the current sole Appointor of the Trust. The power to determine who will be Appointor or Appointors on his death may not strictly be a personal asset, but I think that it sufficiently falls within that description for advice to him on that topic to be regarded as confidential to him.
Accordingly, I will draw a distinction in relation to privilege between documents, or portions of documents, relating to the Trust that concern who the Appointor is to be on John’s death, and those that relate to the assets of the Trust. In respect of the first category, unless there is some other reason not to accept Ms Tyson’s evidence that the documents are confidential, I will do so and they are privileged. However, an issue of derivative waiver may then arise because he has provided the concluded forms of some at least of the various variations of the Trust to Andrew, even where Andrew has not executed the variation.
In respect of documents relating to assets of the Trust, I do not consider that the evidence supports the claim that they are confidential to John.
Secondly, the questionable use of the term ‘estate planning’ also arises in relation to the ownership of shares in the second defendant. John has shares in the second defendant, and so communications about the disposition of those shares concern his personal assets and I accept that those discussions would ordinarily be confidential and privileged. However, John has provided to the plaintiff those portions of executed wills which concern the disposition of those shares. Accordingly, the privilege in relation to the disposition of his shares on his death in executed wills at least has been waived. I do not consider that by this disclosure he has necessarily waived his privilege in relation to instructions or advice about the disposition of his shares on his death, prior to execution of the relevant will. However, in some instances I require production of communications touching on these instructions or advice, but for other reasons (for example, because the communications relate to the capacity in which the second defendant owns the Orana Park Property or disclosure of them is necessary to understand the disclosed wills).
Thirdly, the use of the term ‘estate planning’ arises in relation to the capacity in which the second defendant owns the Orana Park Property. Many of the documents over which legal advice privilege is claimed concern this issue. The Supplementary Affidavit of Documents is expressed to be on behalf of both defendants, and so the privilege claim is also formally made by the second defendant. However, the evidence to support the claim is given by Ms Tyson and she claims that the confidentiality is that of John, and is in relation to his personal assets. The second defendant is a distinct legal entity from John, although he is the majority shareholder. The assets of the second defendant are not John’s assets. Ms Tyson does not depose that documents relating to the assets of the second defendant are confidential to it. Further, if the second defendant owns the Orana Park Property as trustee for the Trust, then those communications concern assets of the Trust. Accordingly, I do not consider that documents or portions of documents relating to the capacity in which the second defendant owns the Orana Park Property are privileged.
If this is incorrect, then in the alternative I consider that the privilege in those documents has been waived by the positive assertion by the defendants that the second defendant owns the Orana Park Property in its own capacity i.e. by issue waiver.
I give examples of how I apply these principles to particular documents as follows.
Document 106 is an internal instruction as to where to file copies of the Deed of Appointment dated 18 December 2014. The Deed relates to the Trust, not to the personal affairs of Mr John Lamers, and so contrary to the assertion in Ms Tyson’s affidavit of 11 November 2016[74] cannot be confidential to him. Ms Tyson did not in her affidavit of 11 November 2016 assert that any documents over which privilege was claimed were confidential to the second defendant, who is the trustee of the Trust. It follows that Document 106 is not confidential, and so cannot be privileged. It must be disclosed.
[74]At [34].
Document 107 relates to the deed packet for Orana Park Pty Ltd as trustee for the Trust. By the same reasoning as applies to Document 106, it is not confidential to the first defendant and there is no evidence that it is confidential to the second defendant. It is not privileged and must be disclosed.
Communications responsive to those no longer claimed to be confidential
The second issue on the re-opened question of privilege arises from the consequences of the withdrawal of the claim of confidentiality in respect of Documents 91, 92 (in part) and 99, in relation to responsive documents.
Document 91 is already disclosed, and no longer claimed to be confidential and so privileged. Document 91 is a request for an appraisal of three properties, one of which is the Orana Park Property. The request states that all three properties are ‘owned by Mr John Lamers’. This is plainly incorrect, as the Orana Park Property is owned by the second defendant. I do not know who owns the other two properties, although the context suggests that it is the first defendant.
The defendants still claim privilege in those portions of the appraisals given in response to Document 91. Those appraisals appear in Document 92, and the appraisals relating to the two properties other than the Orana Park Property have been redacted. To be privileged they must be confidential. In my view they cannot be confidential if the request was not confidential. Nor can they be irrelevant if the request was not irrelevant. The defendants have not limited their change of position in relation to Document 91 (the request) to the Orana Park Property only- they no longer assert privilege in respect of any of the request. It follows that in my view none of the appraisals have the character of confidentiality necessary to maintain the claim of privilege. The whole of Document 92 must be disclosed.
Document 99 is already disclosed, and is no longer claimed to be confidential and so privileged. It is a letter dated 9 December 2014 from Ms Tyson to accountant Mr Tim Bolge. It seeks return of a Deed of Variation of Trust signed by Andrew and asks for information that assumes and states that the Orana Park Property is owned by the second defendant in its capacity as trustee. Document 98 is a record of an attendance on Mr Bolge by Ms Tyson on the same date as the letter. It is not entirely clear from its contents whether the attendance preceded the letter, or was responsive to it, but it seems more likely to be the latter because it appears to record information in response to the enquiries in the letter.
For the same reasons as expressed in relation to the redacted portion of Document 92 I do not consider that the defendants can say that the request for information is not confidential, but the information supplied in response is. Accordingly, I consider that Document 98 is not privileged and must be disclosed.
Waiver
Three forms of waiver potentially arise- disclosure waiver, issue waiver and derivative i.e. s 126 waiver.
Disclosure waiver
In relation to disclosure waiver, it is not enough to show action inconsistent with the maintenance of confidentiality that a disclosed document or communication concerns the same subject matter as a document over which privilege is still claimed. Some of the plaintiff’s submissions seemed to go this far,[75] and I do not consider that to be supported by authority.
[75]For example, Plaintiff’s Outline of Submissions dated 31 October 2016 at [43].
Further, by parity of reasoning with Mullet v Nixon, the disclosure must reveal more than the existence of the privileged documents. The disclosure is only inconsistent with the maintenance of confidentiality in the privileged document if it reveals the ‘gist or substance’ of the privileged document or communication.
I apply this reasoning to the documents prepared for the purpose of advising John on the various changes to Appointors of the Trust following his death. The concluded variations to the Trust have been disclosed, but as noted earlier I do not think that is necessarily inconsistent with the maintenance of confidentiality in the advice given prior to the concluded variation.
I take the same presumptive approach to any documents that were created for the purpose of taking instructions from John and advising him on changes to the bequests of his shares in the second defendant. He has provided the plaintiff with those portions of his wills as executed, and the whole of the wills were confidential to him. I do not think that this disclosure is necessarily inconsistent with continuing to assert his confidentiality in the instructions he gave and advice he received in relation to the changes. There are, however, some documents or portions relating to draft dispositions of his shares that I consider should be disclosed because their disclosure is necessary for a proper understanding of the concluded will. This disclosure is pursuant to s 126.
Issue waiver
Issue waiver does not arise from a mere denial. However, I consider that read fairly the defendants have advanced a positive case in two relevant respects. First, they do not just deny that the second defendant owns the Orana Park Property as trustee, and admit that it owns it in its own right. They advance in sub-paragraphs 9(a)(i)-(viii) of their defence a substantive case to support this latter contention. As set out earlier, I do not consider that John can claim legal advice privilege in documents related to the capacity in which the second defendant owns the Orana Park Property, and there is no evidence to support the formal claim to privilege made by the second defendant. Documents relating to that issue are accordingly not privileged. If I am wrong in that conclusion on privilege, however, I consider that the defendants have acted inconsistently with the maintenance of confidentiality in documents relating to legal advice to John about the capacity in which the second defendant owns the Orana Park Property by assertion of their positive case. On either analysis, those documents should be produced.
The second relevant positive case asserted by the defendants is that Mr John Barlow did not have actual or ostensible authority to make the representations that Andrew alleges he made to him in or about April 1999 and October 2000 (as asserted in paragraph 9(a)(ix) of the defence). I accept the submission of the defendants that the privileged documents, which are communications between John and his former solicitors or internal documents of those solicitors, will not cast light on any ostensible authority, as ostensible authority is to be determined by external presentation to the world, not by internal communication with the principal. However, some of the privileged documents may cast light on whether Mr Barlow had actual authority to make any such representation.
In relation to the documents in respect of which privilege has been waived by the assertion of the absence of actual authority, I accept the submission of the defendants that the scope is determined by authority to make representations to Andrew i.e. not by authority to take instructions from either or both of John and the second defendant and advise one or both of them generally. The case asserted is not expressly limited to representations to Andrew, as opposed to others (such as the accountants), but when read with the allegation in paragraph 7 of the statement of claim, I think it should properly be limited in that way.
The formulation advanced by counsel for the defendants is that privilege is waived in respect of ‘any document otherwise privileged that discloses any authorisation by the first defendant to John Barlow to make the oral representations alleged in paragraph 7 of the statement of claim’. I consider this too narrow.
First, I note that this formulation assumes that the representation that is identified in paragraph 9(a)(ix) of the defence (capacity in which the Orana Park Property is owned) is the same as the representations alleged in paragraph 7 of the statement of claim (as to becoming appointor under the Trust and the effect thereof). They are not expressly the same, but the defendants appear to concede that the representation as they express it was implied in the representations that Andrew says Mr Barlow made. The formulation advanced by the defendants is too narrow, however, in my view because:
· it is limited to the grant of authority to do a specific thing, not the implication of actual authority to do that thing, amongst others, that might properly be inferred from other conduct, for example other attendances by Mr Barlow on Andrew;
· it is limited to the grant of authority, not, for example content that discloses there was no such authority; and
· it is limited to the time at which the representations were said to have been made. Actual authority to make the representations, or the absence of such authority may be evidenced by conduct within a broader time frame.
I note also that the formulation advanced by the defendants is confined to authority conferred by the first defendant, John, when the case advanced relates to both defendants. Andrew is, of course, a director of the second defendant and it may be that in that capacity he could give Mr Barlow, as solicitor for the second defendant, authority to discuss matters relating to the second defendant with himself. The parties have not, however, taken me to the Memorandum and Articles of Association of the second defendant, or any other matter that may illuminate this question.
In my view, by the assertion that Mr Barlow did not have their authority to make representations to Andrew about the consequences of him becoming sole Appointor or the capacity in which the Orana Park Property is owned by the second defendant, the defendants have waived privilege in any communication or document that was otherwise the subject of legal advice privilege only:
· of any type, of any date, and by any author within Birch Ross & Barlow; and
· that refers expressly or implicitly to:
· Mr Barlow meeting or communicating with Andrew in relation to the Trust, the Orana Park Property or the operations of the second defendant;
· whether Mr Barlow had the authority of either of the defendants to do so; or
· what Mr Barlow had the authority to say or do at such a meeting;
I confine this waiver to documents that are the subject of legal advice privilege because the privilege claim in respect of documents created for the purpose of this proceeding is not challenged. Further, there is no inconsistency in creating documents the subject of privilege under s 119 that refer to these matters. In the preparation for and response to litigation it is to be expected that documents will be prepared that refer to issues in the proceeding, and that is not inconsistent with the maintenance of the privilege over such documents- indeed it is entirely consistent with it.
On scrutiny of the documents in respect of which privilege is challenged, the only documents or portions of documents that I consider fall within this description are as follows:
· A portion of Document 76 which relates to the authority of solicitors of Birch Ross & Barlow to make representations to Andrew in the period prior to 17 February 2010;
· A portion of Document 127 which implicitly relates to the authority of Mr John Barlow to communicate with Andrew in May 2014; and
· Portions of Document 140 which evidence the authority of Mr John Barlow to act in relation to ‘Orana Park’ and the Trust in February 2010.
These portions of these documents are to be disclosed, in some cases for other reasons as well.
Derivative waiver
Derivative waiver i.e. waiver of the privilege in an associated document will only arise following the disclosure of another document if the disclosed document was itself privileged, and disclosure of the associated document is necessary to understand the disclosed document.
Derivative waiver can arise from the voluntary disclosure of a privileged document, or the disclosure of a privileged document by virtue of waiver, but in either case the disclosed document must have had the character of confidentiality.
Counsel for the plaintiff points to many documents emanating from Birch Ross & Barlow that have been voluntarily disclosed by the defendants in discovery or otherwise that imply or state that the Orana Park Property is owned by the second defendant as trustee i.e. their contents are inconsistent with the defendants’ positive assertion that the Orana Park Property is owned by the second defendant in its own right. The plaintiff submits that:
The documents being withheld by John are so central to the entire alleged transaction and representations relied upon by Andrew that their disclosure is necessary to enable a proper understanding of the communication and documents that have already been disclosed (e.g. the diary note entries made by John Barlow).[76]
[76]Plaintiff’s Outline of Submissions dated 31 October 2016 at [43].
I do not accept this submission as it applies to disclosed documents other than the disclosed wills and Trust documents because I do not think that it reflects a correct understanding of s 126. The section applies where the disclosed document was privileged, but that privilege has been waived. Of the disclosed documents identified by counsel for the plaintiff, only the wills and the changes to the Trust in so far as they relate to Appointor on John’s death were confidential to John, and so privileged. In particular, Document 99, which does contain content inconsistent with the defendants’ case that the Orana Park Property is not an asset of the Trust, is no longer claimed to be privileged and so its earlier disclosure cannot trigger s 126, even if other documents were required for a proper understanding of it. Similarly, the disclosure of Documents 91 and 92 (as now required in full) cannot trigger s 126 because those documents are no longer claimed, or found, to be privileged.
A particular instance where I do consider that s 126 applies is portions of documents relating to John’s wills of December 2014 and April 2015, assuming the portions that relate to disposition of John’s shares in the second defendant have been disclosed. I consider that portions of Documents 102 and 103 should be disclosed because they are reasonably necessary for a proper understanding of the bequests of John’s shares in the December 2014 will. The bequests in the concluded will were confidential but disclosed. Those portions also relate to the capacity in which the second defendant owns the Orana Park Property i.e. whether or not it is Trust property.
I apply the same reasoning to part of Document 114, which is reasonably necessary for a proper understanding of the disposition of John’s shares in the second defendant in his April 2015 will. The portions to be disclosed relate to the capacity in which the second defendant owns the Orana Park Property.
Documents now to be produced
The documents now to be produced, either because the claim for privilege in respect of them is not sustained, or because the privilege has been waived, are as follows:
· Documents 75, 76 (part), 77 (part), and 83 (part) - portions relating to the capacity in which the second defendant owns the Orana Park Property and in the case of Document 76, authority to make representations to Andrew;
· Document 87 (part) - down to and including the first paragraph- refers to a document to be signed by Andrew and so is not confidential to the first defendant;
· Document 88 (part) - the page headed ‘Thoughts arising out of letter dated 9 July 2014’ relates to the capacity in which the second defendant owns the Orana Park Property;
· Document 92 (redacted portion)- these are the other sales appraisals requested by Document 91, which is no longer claimed to be confidential and so privileged;
· Document 98 - this apparently records information supplied by Mr Bolge in response to the enquiry made by Document 99, which is no longer said to be confidential. If the request is not confidential and so privileged, nor is the response. Further, the document records information as to the capacity in which the Orana Park Property is owned;
· Document 101 (part)- the part that records instructions or advice as to the capacity in which the Orana Park Property is owned- either not privileged or the privilege is waived;
· Documents 102 and 103 - those parts that relate to the bequests of John’s shares in the second defendant in his will of December 2014;
· Documents 106 and 107 - not privileged as they relate to the location of Trust documents;
· Document 113 - this is a three page document. Those parts that explain the disposition of shares in the second defendant in will of April 2015 or imply how the Orana Park Property is held are required to be produced. Derivative waiver and/or Trust property.
· Document 114 - this is a four page document that appears to assess proposed bequests by John’s wills of December 2014 and April 2015 on alternative bases, depending on whether or not the Orana Park Property is, or is not, Trust property. I consider that some portions should be produced, being the heading of each page and handwritten annotations on pages 3 and 4; the note at the end of page 1; the portions that list bequests of shares in the second defendant to beneficiaries on page 1; the proposed disposition of portions of Orana Park to Ian and Michelle on pages 2 and 3; and the proposed disposition to Andrew on pages 3 and 4. The balance of the items appear to relate to personal assets of John. The bases for disclosure are derivative waiver arising from the disclosure of portions of John’s wills relating to his shares in the second defendant; the fact that the nature of the ownership of the Orana Park Property by the second defendant is not confidential to John or alternatively he has waived his privilege; and that the assets of the Trust are not John’s assets.
· Document 118 - this is a two page document that assesses proposed bequests by John’s will of 16 October 2015. I consider that the heading of each of the two pages; the proposed distribution of Orana Park as reflected in the first two items on each page; and the handwritten annotation on the second page should be produced because they relate to the capacity in which the second defendant owns the Orana Park Property, and Trust assets, which are not John’s assets. In the alternative, if advice to him on this issue is confidential to him, then he has waived that privilege.
· Document 121- this relates by the second defendant as trustee and so is not confidential to John.
· Document 123 - this relates to the Trust and so does not concern John’s personal assets.
· Document 124 - the heading and the first two entries relate to Trust assets and the capacity in which the Orana Park Property is held.
· Document 127 - part. This part relates to the authority of John Barlow to communicate with Andrew. Issue waiver.
· Document 129 - this is a three page item in similar form to Documents 114, 118 and 124. I consider that the heading on each page; the handwritten annotations on each page; the first two items on pages 1 and 3 (which appear to relate to disposition of interests in the Orana Park Property depending on whether it is Trust property; and the proposed dispositions to Andrew on each page should be produced. The basis is as set out in relation to Document 114.
· Document 130 - a one page document in similar form to part of Document 114. By parity of reasoning, the heading, note at the end of the page, and first two items as they relate to proposed disposition of shares in the second defendant should be produced.
· Document 137 - item 4 which contains instructions or advice in relation to disposition of John’s shares in the second defendant to Andrew. Derivative waiver- necessary to understand the disclosed provision in the executed will; or not privileged because relates to the capacity in which the second defendant owns the Orana Park Property.
· Document 140 - portions that relate to the disposition of shares in the second defendant and action to take in relation to ‘Orana Park’ and the Trust- derivative waiver from disclosure of that portion of the executed will and Deed of Appointment, and issue waiver as to authority of Mr John Barlow to act.
Further issues
Entitlement to documents as a director and shareholder of the second defendant
Andrew submits that:
As a final comment, at all material times Andrew has been a director and shareholder of Orana Park Pty Ltd. As such, it is entirely proper and fair the documents relating to the manner in which Orana Park Pty Ltd purchased the property (i.e. in its own capacity or as trustee) should be made available to him. This should extend to documents relating to the preparation of the Variation Deeds made in 2000 which gave rise to the pleaded Trust Representations as well as advice given to Orana Park Pty Ltd.[77]
[77]Plaintiff’s Outline of Submissions dated 31 October 2016 at [50].
I have averted to Andrew’s possible rights as a director of the second defendant earlier. He has not, however, shown that under the Memorandum and Articles of Association or otherwise he has rights to company documents. Accordingly, this submission is not established.
Destruction of documents relating to the purchase of the Orana Park Property
The Court and the plaintiff have been informed that documents relating to the purchase of the Orana Park Property formerly held by the solicitors for the defendants have been destroyed. If this assertion does not currently appear on the oath of a person with knowledge or knowledge on information and belief[78], it should.
[78]I note that John deposes in the defendants’ first Affidavit of Documents sworn 15 January 2016 at [5] to the destruction of some original documents in accordance with the usual practices of Birch Ross & Barlow which may relate to the purchase, and at item 19(l) of Schedule 1 Part 1 which relates to wills o his signed authority to destroy documents dated 9 May 2006.
Orders
I will ask the parties to prepare orders to give effect to these reasons, and directions for the future conduct of the proceeding.
In relation to costs, subject to submissions to the contrary, my preliminary view is that the defendants should pay all the plaintiff’s costs of the summons on the usual i.e. standard basis. The defendants are already required to pay the plaintiff’s costs thrown away by reason of the adjournment of the first day of hearing, and should be required in any event to pay the costs of the further submissions and affidavit of Mr Allen, which were occasioned by their due to their change of position. In relation to the substance, the plaintiff has been substantially successful in challenges to privilege and in relation to assertions of waiver, and largely on the basis of the potential inaccuracy of the descriptor ‘estate planning’ and the facts of disclosure and the nature of the defendants’ case maintained throughout by Mr Rickard in his affidavits and by counsel for the plaintiff in submissions. Total success in a dispute of this nature is not to be expected, and the level of the plaintiff’s success is due in large part to the failure by the defendants and their solicitors to properly consider the distinction between personal and non-personal assets of John; to appreciate the consequences of their positive cases as to the capacity in which the second defendant owns the Orana Park Property and the lack of authority in Mr Barlow to make representations; and what flows from the disclosure of Trust documents and portions of John’s wills.
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