Leigh-Mardon Pty Ltd v Titan Corp Ltd
[1997] FCA 942
•12 September 1997
FEDERAL COURT OF AUSTRALIA
PRACTICE AND PROCEDURE - Legal professional privilege - Waiver - Proofs of evidence prepared by applicant’s solicitors incorporated by reference into police statements - Whether confidentiality in the proofs was lost by providing statements to the witnesses - Whether confidentiality lost by providing statements knowing they may be given to the police - Whether express waiver of privilege - Whether implied or imputed waiver of privilege - Whether unfair in the circumstances for privilege to remain against the respondents
Goldberg v Ng (1995) 185 CLR 83
Leigh-Mardon v Titan Corporation & Ors (Federal Court of Australia, Northrop J, 21 November 1996, unreported)
LEIGH-MARDON PTY LTD v TITAN CORPORATION LTD & Ors
VG 346 of 1993
JUDGE: NORTH J
PLACE: MELBOURNE
DATED: 12 SEPTEMBER 1997
| IN THE FEDERAL COURT OF AUSTRALIA | |
| VICTORIA DISTRICT REGISTRY | VG 346 of 1993 |
| GENERAL DIVISION |
| BETWEEN: | LEIGH-MARDON PTY LTD (ACN 004 432 633) |
| AND: | TITAN CORPORATION LIMITED (ACN 003 503 615) BAIROIL PTY LTD (ACN 005 292 795) BAIROIL (ACT) PTY LTD (ACN 008 581 628) BAIROIL (VIC) PTY LTD (ACN 006 168 636) OMPROD DCS PTY LTD (ACN 005 599 799) OMPROD PDC PTY LTD (ACN 005 473 496) OMPROD HOLDINGS LTD (ACN 006 737 159) OMPROD MANAGEMENT LIMITED (ACN 006 682 880) BAIROIL (TEMPS) PTY LTD (ACN 005 966 950) GODFREY DAVID CULLEN and GARY CHARLES GRACO |
| JUDGE(S): | NORTH J |
| PLACE: | MELBOURNE |
| DATED: | 12 SEPTEMBER 1997 |
REASONS FOR JUDGMENT
On 25 August 1997, the applicant filed a notice of motion claiming legal professional privilege over proofs of evidence of John Milton Barnes and Shane Ryan Truscott prepared by the solicitors for the applicant. The claim to privilege arises in the following circumstances. Mr Barnes was the manager of computer operations of Australian Airlines and Mr Truscott was an officer employed by the State Revenue Office at the time that the first, second, fifth, sixth, seventh, eighth, tenth and eleventh respondents (the respondents) are alleged to have been involved in overcharging clients. The overcharging of Australian Airlines and State Revenue Office are issues in the present proceedings. Consequently, the applicant’s solicitors interviewed Mr Barnes and Mr Truscott and prepared proofs of evidence from them. On 6 November 1996, the applicant’s solicitors sent Mr Truscott’s proof of evidence to him with a letter requesting him to sign and return it to them. He apparently did so, because the applicant’s solicitors have a copy of the proof signed by Mr Truscott and dated 20 November 1996. The applicant’s solicitors did not provide the proof to anybody else. On 28 November 1996, the applicant’s solicitors sent Mr Barnes’ proof of evidence to him with a letter requesting him to sign it and return it to them. He apparently did so, because the applicant’s solicitors have a copy of the proof signed by Mr Barnes and dated 3 December 1996. At this time, the Major Fraud Group of the Victoria Police were investigating the alleged overcharging. On 5 December 1996, the Major Fraud Group rang the applicant’s solicitors and requested a copy of Mr Barnes’ proof, saying that Mr Barnes had given permission to the Major Fraud Group to obtain a copy from the solicitors. The applicant’s solicitors refused to provide the Major Fraud Group with the copy. On the same day, Mr Barnes rang the applicant’s solicitors and asked for a copy of his signed proof. The applicant’s solicitors sent Mr Barnes a copy of his proof in response to his request.
On 17 December 1996, Mr Barnes signed a statement taken by the Major Fraud Group from him in relation to the matters under investigation and, on 30 July 1997, Mr Truscott signed a statement taken by the Major Fraud Group from him in relation to the matters under investigation. Mr Barnes and Mr Truscott produced the proofs of evidence to the Major Fraud Group at the interviews and the proofs were incorporated by reference into the statements. The statements, in part, comprise comments on and explanations of the incorporated proofs .
Two subpoenas, one dated 10 April 1997 and the other 24 July 1997, were served by the applicant on Detective Chief Inspector Cockerell of the Major Fraud Group, requiring the production of, inter alia, the statements of Mr Barnes and Mr Truscott. The statements, together with the proofs of evidence incorporated in the statements, were produced to the Court on 7 August 1997. The motion, notice of which was filed by the applicant on 25 August 1997, seeks orders that the proofs of evidence not be produced for inspection by the respondents and that the proofs be returned to the solicitors for the applicant.
Mr Shirrefs, who appeared as counsel for the respondents, first contended that the applicant’s privilege in the proofs of evidence had been expressly waived as confidentiality in the documents had been lost. It is convenient to deal with each of the proofs separately on this issue. In the case of Mr Truscott, the applicant’s solicitors sent his proof to him for signature and return. The obvious purpose of this step was to have Mr Truscott verify that the written proof accorded with his instructions. By sending the proof to Mr Truscott for this limited purpose, the solicitors for the applicant did not indicate that he was free to use it for any purposes other than to sign and return, or to refuse to sign. It was not necessary, although it may have been desirable to avoid argument, that the letter state that the proof could not be used without permission. That was implicit in the circumstances.
In the case of Mr Barnes, I infer that the applicant’s solicitors knew, when they forwarded him a copy of his proof upon request, that he intended to pass on a copy of the proof to the Major Fraud Group. The applicant did not expressly waive its right to keep the proofs confidential as against the respondents. Again, it was implicit in the circumstances surrounding the giving of the proof to Mr Barnes that he would use it for the limited purpose of his interview with the police.
Counsel for the respondent then contended that the circumstances gave rise to an imputed waiver of legal professional privilege. The proper approach to such waiver was explained by Deane, Dawson and Gaudron JJ in Goldberg v Ng (1995) 185 CLR 83, at 95‑96:
“The circumstances in which a waiver of legal professional privilege will be imputed by operation of law cannot be precisely defined in advance. The most that can be done is to identify a number of general propositions. Necessarily, the basis of such an imputed waiver will be some act or omission of the persons entitled to the benefit of the privilege. Ordinarily, that act or omission will involve or relate to a limited actual or purported disclosure of the contents of the privileged material. When some such act or omission of the person entitled to the benefit of the privilege gives rise to a question of imputed waiver, the governing consideration is whether ‘fairness requires that his privilege shall cease whether he intended that result or not’ (Wigmore on Evidence (McNaughton rev 1961), vol 8, par 2327, quoted with approval by Gibbs CJ and by Mason and Brennan JJ in Attorney-General (NT) v Maurice (1986) 161 CLR 475 at 481, 488). That does not mean, however, that an imputed waiver must completely destroy the privilege. Like an express waiver, it can be limited so that it applies only in relation to particular persons, materials or purposes.
In Attorney-General (NT) v Maurice ((1986) 161 CLR 475), it was accepted in all judgments that the question whether a limited disclosure gives rise to an implied or imputed waiver of legal professional privilege ultimately falls to be resolved by reference to the requirements of fairness in all the circumstances of the particular case. Thus, Gibbs CJ saw the decided cases as establishing that (Maurice (1986) 161 CLR 475 at 481):
‘.... the question whether a waiver should be implied depends on whether it would be unfair or misleading to allow a party to refer to or use material and yet assert that that material, or material associated with it, is privileged from production.’”
In that case, Mr and Mrs Ng and a family company (the Ngs) were clients of Mr Goldberg, a solicitor. The Ngs brought proceedings in the New South Wales Supreme Court, alleging that Mr Goldberg had misappropriated funds belonging to them. They also made a complaint to the New South Wales Law Society. Mr Goldberg prepared proofs of his own evidence for his solicitor in relation to the complaint to the Law Society. The proofs were given to the Law Society on the express basis that the proofs would not be made available to the Ngs. The complaints were dismissed by the Law Society. The Supreme Court proceedings remained on foot. The Ngs then issued a subpoena, directed to the Law Society, to produce, inter alia, the proofs of evidence. As the proofs were given to the Law Society on condition that they would not be given to the Ngs there was no express waiver of privilege by Mr Goldberg. However, the majority held that fairness required that there was an imputed waiver. One of the factors which the majority considered in assessing fairness was explained as follows, at 101-102:
“Ordinarily, a party involved in a number of related proceedings or procedures will be able, in one proceeding or procedure, to take advantage of documents or other material which have been utilised by the other party in another of the related proceedings or procedures. That would, presumably, have been the case here if Mr Goldberg had not elected to make use of the privileged documents for the purpose of rebutting Mr Ng’s complaint to the Law Society since the Law Society’s letter of 14 May 1990 (see above) indicates that the ‘usual procedure’ would have been to require Mr Goldberg to make a ‘written response’ (the evidence does not disclose whether, as the Law Society’s letter of 14 May 1990 might suggest, the second privileged statement was in fact supplied to the Law Society pursuant to a request for such a ‘written response’). As Clarke JA pointed out in the Court of Appeal, such a written response would not, if prepared for the purpose of being placed before the Law Society, have been protected by legal professional privilege from production to the Ngs in the equity proceedings. In these circumstances, it would be unfair if the fact that Mr Goldberg saw fit to rely, in answer to Mr Ng’s complaint to the Law Society, upon privileged communications to his solicitor in relation to the equity proceedings should have the effect that the Ngs were deprived of access to, and possible use of, the substance of that answer.”
On 21 November 1996, Northrop J gave a decision on a motion issued in the present proceedings in which he upheld the claim for legal professional privilege asserted by the applicant against the respondents over a proof of evidence of Mr Lindsay Baczyk, which the applicant’s solicitors had prepared and had provided directly to the police. His Honour said:
“I accept that the applicant had the obligation to assist the police in the police investigation. Even though it may be said, and was said in submissions, that there has been a degree of cooperation between the applicant and the police, this is a case where the cooperation is designed to assist the police in their criminal investigations. It has also been said that on a proper analysis of Goldberg, the giving of the statement by Mr Goldberg to the Law Society officials, did result in a benefit to Mr Goldberg in regard to the separate proceedings existing between Mr and Mrs Ng and Mr Goldberg. Because of that benefit it was only fair, having regard to all the circumstances as I have outlined, that there ought to be disclosure of the document which otherwise would have been subject to a legal professional privilege.
In my opinion there is no requirement of fairness, as explained in Goldberg’s case, to require the production of the document in this case. Put in other terms, I am not satisfied that there can be imputed any waiver arising from the fact of the applicant giving to police a document which otherwise is subject to the privilege for the purpose of allowing that document to be used by the police in their investigations. It was not given in any way to gain a benefit to the applicant in the proceedings currently before this Court. It cannot be said that as a result of giving that document there is a question of fairness arising as between the applicant and respondents in the conduct of this proceeding.”
In my view, the position in the present case in relation to Mr Barnes is not relevantly different to the situation addressed by Northrop J. The applicant’s solicitors provided the proof of evidence to Mr Barnes when they contemplated that he would then pass it on to the police. However, as I have found, the confidentiality of the documents, at least as regards the respondents, was not lost. The applicant is in no worse position in the present case than it was in the previous application. The case of Mr Truscott is a fortiori. The applicant’s solicitors forwarded the proof to Mr Truscott for the limited purpose of signature and return. Had the applicant wanted to prevent the disclosure of the proof of Mr Truscott to the police, there may have been grounds to do so. But the failure to take steps to prevent that disclosure does not make it unfair for the privilege to remain as against the respondents. Just as there was no unfairness between the applicant and the respondents in the maintenance of the privilege when the proof of evidence was disclosed to the police by the applicant, there is no unfairness now when the proofs of evidence were disclosed to the police by the witnesses themselves.
Mr Shirrefs contended that there was unfairness in this case in the same way as there was in Goldberg. Mr Goldberg used the proof of evidence as a vehicle to claim privilege. If he had responded to the Law Society in the usual way, without using the document prepared for the civil case, his response to the Law Society would not have been privileged and would have been available to the Ngs. In the present case, if Mr Barnes and Mr Truscott had told the police in the interviews exactly what is contained in the proofs of evidence, without producing the proofs of evidence, the record of interview would have contained the same information as contained in the proofs of evidence and the records of interview would have been available to the respondents. The respondents contended that it was therefore unfair to them to be denied material in the hands of the police, just as it was unfair for the Ngs to be denied the material available to the Law Society. But, as Northrop J pointed out, the unfairness in Goldberg derived from the fact that Mr Goldberg had obtained a benefit by the use of the proof in the Law Society’s deliberations. In the present case, the applicant did not gain a benefit from the use of the proofs in the police interviews, whether the proofs were given directly by the applicant or indirectly by Mr Barnes and Mr Truscott.
In the result, the proofs of evidence of Mr Barnes and Mr Truscott are privileged and the privilege has not been waived. Consequently, the application made by the applicant in paragraph 1 of the motion, notice of which was filed on 25 August 1997, will be allowed with costs. I will hear the parties further on the appropriate form of order to reflect this decision.
| I certify that this and the preceding six (6) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice North |
Associate:
Dated: 11 September 1997
| Counsel for the Applicant: | Mr R Robson QC with Mr N Lucarelli |
| Solicitor for the Applicant: | Maddock, Lonie & Chisholm |
| Counsel for the Respondent: | Mr S Shirrefs |
| Solicitor for the Respondent: | Jerrard & Stuk |
| Date of Hearing: | 3 September 1997 |
| Date of Judgment: | 12 September 1997 |
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