Loscam Ltd v Brambles Holdings Ltd; Loscam Ltd v Brambles Holdings Ltd

[1993] HCATrans 168

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IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Melbourne No Ml8 of 1993

B e t w e e n -

LOSCAM LIMITED

Applicant

and

BRAMBLES HOLDINGS LIMITED

Respondent

Office of the Registry

Melbourne No Ml9 of 1993

B e t w e e n -

LOSCAM LIMITED

Applicant

and

Loscam 1 18/6/93

BRAMBLES HOLDINGS LIMITED

Respondent

Applications fo~ special

leave to appeal ·

DEANE J
TOOHEY J
McHUGH J

TRANSCRIPT OF PROCEEDINGS

AT MELBOURNE ON FRIDAY, 18 JUNE 1993, AT 3.58 PM

Copyright in the High Court of Australia

MR P.B. MURDOCH, QC:  May it please the Court, I appear in

this matter with my learned friend, MR J. BEACH,

for the applicant. (instructed by Freehill

Hollingdale & Page)

MR P.H. CLARKE: If Your Honours please, I appear on behalf

of the respondent in this matter.	(instructed by
Corrs Chambers Westgarth)

DEANE J: Yes, Mr Murdoch.

MR MURDOCH:  For the assistance of the Court, might we hand

the Court our outline. We understand the Court has

been provided with a number of

folders ..... statutory information and the cases to

which we wish to refer. The application for leave

arises from the following circumstances. In

proceedings which were issued out of the Supreme

Court of Victoria by the respondent against the applicant in 1989 and in further proceedings issued

in 1990, Mr Justice Ormiston made orders, among

other things, enjoining the applicant from certain

conduct.

The respondent says that the appellant is in

contempt of court because it breached those orders

and has commenced proceedings against the appellant

for its punishment.

DEANE J:  You may assume that we have all read the papers,

Mr Murdoch.

MR MURDOCH: If Your Honour pleases. The ground upon which

the applicant seeks its special leave is set out in
paragraph 1 of the outline of argument and that is
that an application for leave to appeal against the
order made by Mr Justice Harper was refused by the

Full Court, without reason, and that was an order

made wherein His Honour had refused to order

production for inspection of certain documents

which had been discovered by the respondent and in

respect of which it had claimed legal professional

privilege.

Loscam 2 18/6/93

In His Honour's reasons which might be found

at page 71 of the appeal papers and after having

dealt with the test laid down in Grant v Downes

His Honour said that he would proceed to examine

the documents on the following basis. His Honour

said:

I proceed on the basis that in my

examination of the individual documents in

question here I must determine the question of

privilege according as to whether the

description of the document given by Mr Kerr

is such as to indicate that it meets the

Grant v Downes test, and if that description can be properly said to meet the Grant v

Downes test, the next step for me, as I

apprehend my task, is to determine whether the

document itself on examination is consistent

with that description.

Mr Beach made some submissions to His Honour

and at line 15 of page 72, His Honour then said:

I have examined Mr Kerr's affidavit in the light of Mr Beach's criticisms, but in the end

I am satisfied that the individual description

of each document is based upon either

Mr Kerr's own knowledge, or upon information

given to him by the creator of the document -

and he accepted submissions of Mr Clarke that one

could properly conclude that the description which

had been applied to the documents in the affidavit

was correct.

His Honour then at page 73 proceeded to

observe that:

Mr Beach correctly pointed out that these

proceedings are in nature quasi criminal.

He then observed at line 12: 

As I say, those proceedings are quasi criminal

in nature. It follows from that, Mr Beach

submits, that at the very least the question

_ of legal professional privilege should be

-looked at in a special light. I accept his

submissions in that regard, at. least in so far

as they would have me examine the individual

documents so as to determine the extent that

they indicate that the defendant is not guilty

of contempt. Documents which tend to

exculpate the defendant ought to be made
available for examination, unless the claim

for legal professional privilege outweighs the

injustice that would otherwise be done to the

Loscam 3 18/6/93

defendant were it not given access to the

document in question. I can say, however,

that my inspection of each of the documents

discloses that there is nothing in them which

would deal in any but the most indirect way
with the ultimate question of contempt or no

contempt.

His Honour then made the significant observation:

It may be that on inspection the defendant

might decide to use a particular document if

such use were otherwise open to it in order to

cross-examine witnesses, or for like purposes.

But none of the documents directly suggest

that the defendant ought not to be found

guilty of contempt. Accordingly, in my

judgment, even given that I should, in

appropriate circumstances, weigh the interests

of the defendant in this regard against the

interests of the plaintiff in maintaining the

privilege, such an exercise would not result

and should not result in the inspection of any

of the documents in question by the defendant.

With respect, it is our submission that the

test that His Honour applied in the circumstances

was a test which was too narrow. It is our

submission that, in the context of criminal

proceedings and, it is submitted in these

circumstances, in relation to documents that would

perhaps enable a man either to establish his

privilege which otherwise attaches to such

innocence or to resist an allegation made by the

documents is then subordinated to the interests and

the rights of the defendant, and in this case the

applicant, to obtain access to the same.

In that context we rely upon firstly, the

judgment of Mr Justice Caulfield in the case of Reg

v Barton which the Court might find behind guide

card 16.

TOOHEY J: Just before you take us to that, Mr Murdoch, if

special leave to appeal were granted, what would

you be asking of this Court? In the end the notice

of appeal asks that the matter go back to the Full

Court, but would you be asking this Court to do any

more than to lay down, in terms of ·paragraph 3 of

your grounds of appeal, what the relevant law was?

MR MURDOCH:  Yes indeed, Your Honour, that is what we would

ask.

TOOHEY J: And no more than that?

Loscarn 4 18/6/93

MR MURDOCH:  No more than that and then to remit the

matter - - -

TOOHEY J: Well, there would be consequential orders, of

course.

MR MURDOCH:  Yes.

TOOHEY J: But they would be confined, as I read the notice

of appeal, to the matter simply going back to the Full Court for determination on the basis of that

principle.

MR MURDOCH:  In accordance with that ruling, yes,

Your Honour.

TOOHEY J: Yes, thank you.

MR MURDOCH:  The facts in Reg v Barton were simple and were

set out in the headnote:

The defendant was charged with fraudulent conversion, theft and falsification of

accounts alleged to have been committed in the

course of his employment as a legal executive

with a firm of solicitors. The defence served

on a solicitor, a partner in the firm, a

subpoena to give evidence at the trial, and to

produce certain documents which had come into

existence while the solicitor was acting as

the solicitor to the executors.

DEANE J: But really, taking us to the case does no more,

does it, than set out what we have already read in

the judgment of the Full Court, in that the judge

in that case expressly said he had not been

referred to any relevant authority, it was on

circuit, and so on.

MR MURDOCH:	Indeed, Your Honour, yes.
DEANE J: Well, I mean, all you get is the accuracy of the

quotation from page 157 which is the essence of the

decision.

MR MURDOCH: But, in the judgment of Justice Caulfield,

whi9h is at page 118 of the Weekly Law Reports,

Hia Honour said:

If there are documents in the ·possession or control of a solicitor which, on production, help to further the defence of an accused man,

then in my judgment no privilege attaches.	I
cannot conceive that our law would permit a
solicitor or other person to screen from a jury information which, if disclosed to the jury, would perhaps enable a man either to

Loscam 18/6/93

establish his innocence or to resist an

allegation made by the Crown. I think that is

the principle that should be followed.

Now, in exercising his discretion,

Mr Justice Harper looked only to the question of

whether the documents provided direct evidence of

an exculpatory nature, and did not look to the

second part of the test proposed by

Mr Justice Caulfield which was that:

There ought not to be kept from an accused person documents which would enable that man

to resist an allegation which was made by the

Crown.

The proposition that His Honour enunciated was a

proposition that the documents had to directly

suggest that the applicant ought not to be found

guilty of contempt.

But, with respect, it is submitted that

His Honour ought to have given consideration to the question of whether documents may be indirectly

used for the purposes of the accused person

establishing its innocence and, in the

circumstances, ought to have scrutinized the

privileged documents with a view to seeing whether

any of them could be used for the purposes, for

instance, of cross-examination in the proceedings

when they come on for hearing.

The proposition is, perhaps, better understood

from the judgment of Reg v Ataou which is found

behind guide card 18. That is a judgment of the

Court of Appeal, and is found at (1987) 2 WLR 1147.

At the top of page 1154 the Court said this:

Basing ourselves on the principle which

attracted Cooke J, as cited above, and on the

passage from Cross on Evidence and amended for

the purposes of the issues raised in this

appeal, we would set out the principle as

follows: "When a communication was originally

privileged and in criminal proceedings

privilege is claimed against the defendant by

_ the client concerned or his solicitor, it

-should be for the defendant to show on the

balance of probabilities that .the claim cannot
be sustained. That might be done by

demonstrating that there is no ground on which

the client could any longer reasonably be

regarded as having a recognisable interest in

asserting the privilege. The judge must then

balance whether the legitimate interest of the

defendant in seeking to breach the privilege

Loscam 6 18/6/93

outweighs that of the client in seeking to

maintain it."

It is our submission, in these circumstances,

that the judge in the circumstances ought to have

balanced what was the legitimate interest of the

defendant in the contempt proceedings in seeking to

breach the privilege which His Honour found to

exist in the documents which had been discovered,

because in the circumstances the defendant's rights

ought to be seen to outweigh those of the

prosecutor in maintaining the privilege in those

documents.

DEANE J:	Do you deny that any weighing process is involved?
MR MURDOCH:	Yes, with respect, Your Honour, because

His Honour determined the principle and the

principle that His Honour deten,,.ined was that the

only documents which a defendant in the
circumstances should have access to are documents

which directly may go to establish his innocence,

and His Honour gave no consideration to the

question whether or not there ought to have been
disclosed by production to the defendant those

documents which might properly be used by him in

the proceedings which may indirectly be used for the purposes of opposing the prosecutor's claim.

DEANE J:  That does not answer my question. My question

was: do you dispute the existence of a weighing

procedure?

MR MURDOCH: If I understand Your Honour correctly,

His Honour eventually considered - - -

DEANE J:  We may be at cross purposes. What I am asking you

is: is your argument that the interests of the

person entitled to the privilege are completely to

be disregarded?

MR MURDOCH:  No, Your Honour, what we would submit is that,

in the circumstances, this being a proceeding which

is a quasi criminal proceeding and a proceeding

which may have substantial consequences for the

defendant because, in this case, being a company

its assets may be the subject of sequestration or,

if one were to look at the principle in the

circumstances of an individual who was the subject
to a summons for contempt, then he·may be subject

to punishment by way of imprisonment, but in the

circumstances the defendant ought to be permitted

to look at any document which the prosecutor itself

has identified as containing material which is

relevant to the matters specifically in issue in

the contempt proceedings, and that is what has

occurred here.

Loscam 7 18/6/93

DEANE J: That is a third or a fourth test. I mean, I

understand Barton to say if the document either

goes to establish innocence or to resist an

allegation, and Justice Harper to say what he said,

but are you now saying anything that is disclosed

is relevant, even if it does not help your client

at all, and no matter how damaging inspection may

be to the party entitled to it, legal professional

privilege should be made available.

MR MURDOCH:  No, we do not say that, Your Honour, but what

we say is that when His Honour scrutinized the

documents, His Honour scrutinized them with a view

to seeing only whether there was any document which

directly pointed in the direction of exculpation.

DEANE J:	I follow that.
MR MURDOCH:	And we would submit that what His Honour ought

to have done was to have found the existence of a

broader principle. If His Honour had found the existence of the broader principle for which we

contend and for which, we submit, Barton is

authority, His Honour then would have conducted the

weighing process in the light of the principle

which he had found.

DEANE J: That answers my question.

MR MURDOCH:  We submit that what His Honour did was to look

at the documents only with an eye to the principle

which he had already found rather than the one that

we submit His Honour ought to have discovered.

What we submit is that in the judgment of

Mr Justice Caulfield in Barton's case is to be

found a broader principle than the principle which

was discovered by His Honour Mr Justice Harper.

The proposition is perhaps more clearly made

on page 3 at point 4.4.2 where it is submitted that

the respondent, by discovering the documents, has

conceded that they are relevant to the contempt

applications and therefore necessarily concedes

that the disputed documents which His Honour was to

look at fell into one or other of the categories

tha£-has been abovementioned, so His Honour - - -

DEANE J: But why? It could have been a letter from its

solicitor saying, "Your client is guilty of the

grossest contempt of court and for·that reason

proceedings for contempt of court should be

instituted." How would that fall in one or other

of those categories?

Loscam 8 18/6/93

MR MURDOCH:  With respect, clearly such a letter,

Your Honour, would not fall within one of those

categories, but - - -

DEANE J: But it would be relevant.

MR MURDOCH:  It may be relevant and it would not fall within

one of those categories, but if His Honour had

discovered a broader principle, then His Honour

would have looked at the documents pursuant to that

principle rather than to the narrow principle that

he found.

McHUGH J: But His Honour made a finding, or made a

statement, that there was nothing in the documents

which would deal in any but the most indirect way

with the ultimate question of contempt or no

contempt, and it may be on inspection you might be

able to cross-examine some witness on some

document, but none of the documents directly

suggest that your client ought not be found guilty

of contempt.

MR MURDOCH:  But he did, Your Honour, with respect, appear

to concede at the bottom of page 73 that:

It may be that on inspection the defendant might decide to use a particular document if

such use were otherwise open to it in order to

cross-examine witnesses, or for like purposes.

Now, if there were documents of that nature then

they would be documents that we would submit, in

accordance with the judgment of purposes of resisting the application which was

made.

DEANE J: That is not what Justice Caulfield says, of

course. What he says is:

screen from a jury information which -

if you are dealing with documents implies the

documents would be admissible in evidence.

MR MURDOCH: _Indeed, Your Honour, yes.

DEANE J: Whereas, what Justice Harper is referring to is

documents which, although they do not directly bear

on guilt or innocence, might be used in cross-

examination, and the ingenuity of counsel is such

that one wonders whether there are any documents

that do not fall within that description in terms

of once they are relevant.

Loscam 9 18/6/93

MR MURDOCH:  In the case of the Reg v Ataou, to which I

referred the Court before, that was a case in which the privilege was claimed in the circumstances of a

desire to cross-examine. In the case of Ataou as

becomes clear from page 1151 - - -

DEANE J:  I am sorry, what is the tag again?

McHUGH J: 18.

MR MURDOCH:  The claim to privilege which had been asserted

there was a claim to be relieved from being cross-

examined on documents which the co-conspirator,

Harvey, had made to the solicitor for the accused,

and in that case the court observed that:

The consequence of the ruling was that

the appellant lost the opportunity of having

his counsel cross-examine Harvey on what was,

if the attendance note had been correctly

made, a previous inconsistent statement.

So, there the court was dealing with an objection

by the person claiming the privilege to Harvey
being cross-examined on a document which had been
prepared by the solicitors upon his instructions

and, we would submit, that just so in these

circumstances there may be, among the discovered

documents, documents which would properly be able

to be used by the defendant for the purposes of

resisting the claim that it was guilty of contempt

by utilizing them in cross-examination and,

perhaps, by being able to tender them in the event

that any of those statements was a statement which

was a previous inconsistent statement made by a

person who was called by the prosecutor to give

evidence.

Now, at the time His Honour looked at the

documents it would have been, no doubt, difficult

for His Honour to have accurately assessed the

relevance of each of the documents, as it is clear

from the material behind guide card 5 that the

numbers of privileged documents concerned were

extensive, and clearly His Honour has looked at

those documents only for the purposes of seeing

whether any of them may have come under the narrow

test-which His Honour had propounded and, in those
circumstances, was not looking at them critically

for the purposes of making the obse1rVations that

His Honour Justice McHugh referred to.

TOOHEY J:  Mr Murdoch, your argument would virtually lead to

the destruction of legal professional privilege,

would it not, because if you apply the test that

you invite us to apply, for instance, that

documents that would perhaps enable the applicant

Loscam 10 18/6/93

to resist an allegation made by the Crown be

that sort of assessment? available for inspection, how could the judge make

MR MURDOCH: This is a most unusual circumstance,

Your Honour. Here there were civil proceedings

between the parties. It is the rule of the supreme court by which the plaintiff in the

proceedings is the prosecutor in the contempt

application and it is, therefore, not a criminal

prosecution, so that the defendant can rely upon

the prosecutor in accordance with his obligations

to hand over to it all of those documents which

ought properly to be shown to an accused person.

Rather this is a case where the prosecutor is the

plaintiff in the proceedings, cannot be expected to
behave with the same even-handedness or fairness as
a prosecutor is obliged to consider and, in those
circumstances, it has had the choice whether or not
it will bring the application by way of proceeding

for contempt.

It must be taken to know in those

circumstances that if it brings the proceeding,

that the documents which are in its possession and

relevant to those issues may fall to be produced to

a defendant.

TOOHEY J: Yes, I understand that, but that is really what

prompted my question. Your argument leads almost

to the destruction of legal professional privilege

in those circumstances because it is hard to see

how a judge could sift through the documents in

this case and apply the test, or apply as a test. Would they perhaps enable the applicant to resist

an allegation made by the respondent? It would

have to be a sort of on going exercise while the

contempt proceedings continue.

MR MURDOCH: Perhaps that is so, Your Honour, but the

documents concerned are the ones which were

identified by the plaintiff prosecutor as those

documents which it had specifically caused to be

prepared for the purposes of bringing specifically
the contempt proceeding. They are not documents
that are the plaintiff's documents generally in the

action between the parties; they are only the

documents which it has which it has garnered

specifically for the purposes of m~king the claim

in respect of the contempt.

DEANE J: But why in the context of this case, where there

had been a long history of litigation between the

parties concerned in the background and where

considerations of legal professional privilege

would be of unusual importance, is it not a fair

enough approach to say, "Well, if looking at a

Loscam 11 18/6/93

document you can see that it directly bears on the

question of contempt or no contempt, I will order
discovery, but if all it can be used for is

possible cross-examination of some witness, I think

legal professional privilege should prevail". What

is wrong with that in this case?

MR MURDOCH:  We would submit, Your Honour, that the

defendant is hampered in its preparation for

trial - - -

DEANE J:  But how? I mean, you are charged with breach of

an injunction, you are only concerned with your

conduct and, among the privileged documents of
another party, there are documents which do not
directly bear on whether you are guilty or not
guilty of contempt. On what basis should the legal

professional privilege of that party be breached so

that you can go on a fishing expedition and find

out perhaps there is something you might use in

cross-examination of someone if they happen to be

called?

MR MURDOCH:  We are not submitting, Your Honour, that

production ought to be given of those documents
which are not relevant to the matters in issue, or

not relevant to the defendant being able to resist

the allegation that it has committed a contempt.

It does not want to go on a fishing expedition to look at any documents other than those documents which are identified as containing material which

is properly relevant to the issue: did it or did it

not breach the orders that were made by the Court?

In making the affidavit of documents, what the

plaintiff did was to identify only those documents

which contained material which it says is relevant

to matters in issue between the parties, and that

must be taken to be not only those documents which

are directly relevant but those documents which

have indirect relevance.	We would submit that in
those circumstances there ought to be no reason why

documents which were indirectly relevant ought not

to be discovered. The case, Your Honours, behind

guidecard 20, relating to the Peruvian Guano

Company at page 62, it is a trite observation that

the court has no doubt had brought to its attention

on many times, but at the bottom of page 62 where

the court was talking about what are documents

relating to matters in issue in an ·action, the

court said:

The doctrine seems to me to go farther than that and to go as far as the principle which I

am about to lay down. It seems to me that

every document relates to the matters in

question in the action, which not only would

Loscam 12 18/6/93

be evidence upon any issue, but also which, it

is reasonable to suppose, contains information

which may - not which must - either directly

or indirectly enable the party requiring the

affidavit either to advance his own case or to

damage the case of his adversary.

It was in that context that the discovery has been made by the plaintiff of the documents in its

possession in respect of which it has claimed

privilege, and therefore - - -

TOOHEY J: But that does not seem to me to help you, really.

It sort of operates against you, does it not,

because it exposes the breadth of relevance for the
purpose of giving discovery, which would include

documents between the present respondent and its

advisers and documents which go to advance the case

of the present respondent.

MR MURDOCH:  It discloses what the breadth is, but with

respect, Your Honour, they are documents which it

admits - or must be taken to admit - are relevant

to the question of the advancement of its case or

the damaging of the case of the adversary.

TOOHEY J: Yes, but you are inviting the Court to order

disclosure or inspection o.f documents, being

documents covered by a professional privilege which

advance the case of the other party to the litigation. In ordinary circumstances the

documents would be discoverable but they happen

here to be covered by legal professional privilege.

MR MURDOCH:  In those circumstances, Your Honour, when those

documents are then produced to the judge and. the

judge then formulates an appropriately broad test,

the Court then looks at those documents with a view

to seeing whether or not they fall under the test

that he propounds. It is our submission that the

test that was propounded by His Honour

Mr Justice Harper was simply too narrow because the only documents which His Honour saw as it being

appropriate to enforce production of were those

which relate directly to exculpation. That, with

respect, is too narrow.

It is our submission that, in the

circumstances, this is a case which.is appropriate

for the grant of special leave because there are

exceptional circumstances. It is submitted that

although the exercise of discretion upon which

His Honour embarked might be regarded as being

strictly concerned with a point of practice and

procedure, and nevertheless the exercise of the

discretion by His Honour results in a determination

of the defendant's substantive rights, it may also

Loscam 13 18/6/93

be, we should think, if the Court pleases, that if

there is not an opportunity to overturn

Mr Justice Harper's ruling, the defendant might be

estopped at the trial of the proceeding if it

wishes to there seek production of documents in the event that witnesses give evidence that would cause

it to remake its application.

DEANE J: But that would not be so. I mean, if

circumstances changed and documents acquired a

significance as a result of it, there is no way

that Justice Harper's decision that inspection

should· not be granted would preclude a renewed

application.

MR MURDOCH:  If the Court pleases, those are our

submissions.

DEANE J:  Thank you, Mr Murdoch. The Court need not trouble

you, Mr Clarke.

In the context of the factual conclusions expressed by Harper J. in his judgment after

examination of the relevant documents, the Court

considers that an appeal in this matter would not
enjoy sufficient prospect of ultimate success to

warrant a grant of special leave to appeal to this

Court from a decision relating to a matter of

practice and procedure. Accordingly, the

application for special leave to appeal is refused.

MR CLARKE:	We would seek costs, Your Honour.
DEANE J:	Mr Murdoch, nothing you can say about costs, is

there?

MR MURDOCH:  No, Your Honour.

DEANE J: The application is refused with costs.

AT 4.43 PM THE MATTER WAS ADJOURNED SINE DIE

Loscam 14 18/6/93