Malavoca Pty Ltd v Mitchell
[2002] WADC 2
•17 JANUARY 2002
JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS
LOCATION: PERTH
CITATION: MALAVOCA PTY LTD -v- MITCHELL [2002] WADC 2
CORAM: DEANE DCJ
HEARD: 17 AUGUST 2001
DELIVERED : 17 JANUARY 2002
FILE NO/S: CIV 2207 of 1999
BETWEEN: MALAVOCA PTY LTD
Appellant (Defendant)
AND
DARRYL JAMES MITCHELL
Respondent (Plaintiff)
Catchwords:
Appeal against decision of Deputy Registrar - Appellant ordered to produce documents for inspection by respondent - Claim by appellant for privilege of assessor's reports - "Dominant purpose" test - Whether reports came into existence for dominant purpose of anticipated common law proceedings
Legislation:
Workers' Compensation and Rehabilitation Act 1981
Result:
Appeal allowed
Representation:
Counsel:
Appellant (Defendant) : Ms S Taylor
Respondent (Plaintiff) : Ms K L Shannon
Solicitors:
Appellant (Defendant) : McAuliffe Williams & Partners
Respondent (Plaintiff) : Ilbery Barblett
Case(s) referred to in judgment(s):
Esso Australia Resources Ltd v Commissioner of Taxation of the Commonwealth of Australia [1999] HCA 67
Grant v Downs (1976) 135 CLR 674
Hazart Pty Ltd v Rademaker (1993) 11 WAR 26
Hunt v Knabe (No 2) (1992) 8 WAR 96
National Employers Mutual General Insurance Associated Ltd v Waind (1979) 141 CLR 648
Saunders v Commissioner, Australian Federal Police (1998) 160 ALR 469
Sparke v Iama Ltd [2000] WASC 150
Taylor v Batten (1878) 4 QBD 85
Case(s) also cited:
ACCC v Australian Safeway Stores Pty Ltd (1998) 153 ALR 393
Boyes v Colins (2000) 23 WAR 123
Braegrove Pty Ltd v Bendeich [1993] 2 Qd R 239
Brambles Holdings Ltd v WMC Engineering Services Pty Ltd (1995) 14 WAR 239
Brambles Holdings Ltd v WMC Engineering Services Pty Ltd, unreported; FCt SCt of WA; Library No 950153; 5 April 1995
Buttes Gas & Oil Co v Hammer (No 3) [1981] QB 223
Gardner v Irvin (1878) 4 Ex D 49
Handley v Baddock [1987] WAR 98
Southern Equities Corporation v Western Australia Government Holdings Ltd (No 2) (1993) 10 WAR 351
State Energy Commission of WA v Griffin Coal Mining Co Ltd, unreported; SCt of WA; Library No 5882; 9 May 1985
Warner v Women's Hospital [1954] VLR 410
Waterford v Commonwealth (1987) 163 CLR 54
DEANE DCJ: Malavoca Pty Ltd appeals against the decision of a Deputy Registrar of this Court on 27 April 2001 whereby it was ordered to produce for inspection by the respondent five documents, which have been described as items H2 to H6 inclusive and referred to in an affidavit of discovery sworn on behalf of the appellant on 18 April 2001. The matter has a slightly confused history which will be touched upon in due course. As this is an appeal from a Deputy Registrar's decision it is by way of a hearing de novo; Hunt v Knabe (No 2) (1992) 8 WAR 96; Hazart Pty Ltd v Rademaker (1993) 11 WAR 26
On 11 August 1997 the respondent, Mr Mitchell, alleges he sustained an injury to his back during the course of his employment with the appellant. A claim for workers' compensation was submitted on 1 September 1997 following the respondent resigning from his employment with the appellant on 29 August 1997. It is to be noted that this claim preceded the October 1999 amendments to the Workers Compensation and Rehabilitation Act. By letter dated 17 October 1997 the appellant's insurer, Royal & Son Alliance Insurance Ltd ("the insurer"), advised the respondent that his claim would be disputed. As I understand it, the appellant was of the view that the respondent's injury was reported to them whilst the respondent was actually on sick leave and they believed that he had been injured as a result of an incident involving a motorbike. The appellant appears to have obtained further information regarding this matter from a witness who was allegedly present at the time and they informed their insurer accordingly. Eventually liability for the respondent's incapacity was accepted from 11 August to 29 August 1997 only.
By letter dated 15 December 1997 the respondent was advised that liability for any further medical expenses associated with his condition was subject to further medical information being obtained and further investigations being carried out. It is to be observed that this letter was prepared after the documents described as H2 and H3 (referred to later in these reasons) came into existence and were received by the appellant and its insurer. On 24 December 1997 the insurer was advised that the respondent had engaged lawyers to act on his behalf relevant to his claim and the respondent was also advised by the insurer that they intended to arrange a medical review for him.
In March 1998 the respondent underwent surgery and in a letter dated 29 September 1998 the insurer advised him that they would pay for the surgery and recovery period but not for any ongoing treatment. On 27 November 1998 the respondent issued an originating summons with respect to his claim against the appellant.
A number of affidavits have been filed in this matter by representatives of the appellant and its insurer, relevant to the issue of discovery and privilege that is claimed with respect to certain documents the subject of that discovery. The form and contents of these affidavits have been criticised by counsel on behalf of the respondent, who at the outset of this appeal objected to counsel for the appellant being permitted to rely on the contents of those documents during the course of argument. This matter was not the subject of any written submissions but in the end, for the reasons expressed at the time, I took the view that counsel for the appellant should be allowed to refer to the contents of the affidavits, although where a deponent made any comments regarding the appropriateness or otherwise of the proceedings or made any statements concerning conclusions of law these would be disregarded because these are matters entirely within the province of this Court.
Ms Abelson, an administration clerk/payroll officer employed by the appellant, swore an affidavit of discovery dated 4 October 2000. In par 5 of that affidavit Ms Abelson deposed that the insurer had in its possession two assessors' reports including witness statements in relation to which legal professional privilege from production was claimed, on the basis that the documents were brought into existence for the dominant purpose of the appellant (defendant) subsequently obtaining legal advice and for use in this litigation. Those documents were further described in Part II of the first schedule annexed to the affidavit as being items H1 to H4 inclusive. A brief description of each item was also contained in that part of the document. H2 referred to insurance investigators' reports held as a bundle by the appellant's solicitors. The respondent sought leave of the Court for orders for further and better discovery pursuant to O 26 r 6 of the RSC.
On 18 April 2001 Ms Abelson swore a second affidavit of discovery on behalf of the appellant. The respondent then sought leave of the Court for orders for the production and inspection of the documents the subject of further discovery. In Part II of the first schedule to that document, which is in similar form to the first affidavit of discovery, reference is again made to the documents comprising the item H1. Item H2 is described in considerably more detail as being a report dated 8 December 1996 prepared by N E Williams & Associates addressed to the insurer outlining the worker's conditions of employment and the circumstances of his work related accident. Details are provided as to dates of reports, by whom they were provided and why they were commissioned. It is said that this report was generated for the dual purpose of assessing a worker's entitlement to workers' compensation benefits and the exposure of the defendant (appellant) to a claim for damages at common law. Ms Abelson may not of her own knowledge be able to see why particular materials came into existence but the form of her affidavit complies with O 26 r 4 of the RSC.
H3 is described as a surveillance report of Western Investigations dated 11 December 1997 addressed to the insurer. H4 is described as a report of N E Williams & Associates dated 15 January 1998 addressed to the insurer being a report obtained in anticipation of common law proceedings dealing further with the circumstances of the plaintiff's work accident. H5 is described as a surveillance report of Western Investigations dated 23 January 1998 addressed to the insurer and H6 is described as a surveillance report of Western Investigations dated 30 January 1998 addressed to the insurer and as with all other items this was held on the appellant's solicitors' file.
The documents comprising H2 are described as a bundle of insurance investigators' reports in Ms Abelson's first affidavit and in her further affidavit of discovery more detail is given about that report in that it is described more fully including the fact that it is signed with the date 8 December 1996. There seems to have been considerable confusion regarding the description of item H4 in Ms Abelson's first affidavit as compared to her second affidavit. The second affidavit describes item H4 as being in effect an insurance investigator's report dated 15 January 1998 addressed to the insurer in these proceedings. The second affidavit of discovery also contains reference to two additional items, being H5 and H6 comprising surveillance reports of 23 January 1998 and 30 January 1998. It is clear that the first affidavit of discovery makes no specific reference to any of the three surveillance reports, although counsel for the appellant contends that the general reference in the first affidavit of discovery to the bundle of documents comprising H2 really includes those three surveillance reports.
I am not prepared on the material before the Court to infer that Ms Abelson's credit is in any way suspect or that the appellant has behaved improperly in giving discovery. It is regrettable, however, that full and more precise details of documentation held by or on behalf of the appellant were not provided in the initial affidavit accompanying discovery. I make this observation accepting that the description of a document is to identify that it exists, rather than to permit the opposing party to learn the contents of a document or test the truth and for merits of a plea of privilege; Grant v Downs (1976) 135 CLR 674. In making a claim for privilege, however, there should be provided information as to facts from which it can be seen that the claim is appropriate. The Court may order the production of such a document if it considers it fit to do so; Taylor v Batten (1878) 4 QBD 85.
Relevant legal principles
In this matter the parties are largely in agreement as to the legal principles that apply but differ as to the application of the principles to the circumstances of this particular factual situation. There is no doubt that the onus of claiming and supporting a claim for privilege rests upon the party making the claim. In Cross on Evidence 5ed, three kinds of communication which are said to be privileged are identified. These are:
(a)communications between the client or the client's agents and the client's professional legal advisers;
(b)communications between the client's professional legal advisers and third parties, if made for the purpose of pending or contemplated litigation; and
(c)communications between the client or the client's agent and third parties, if made for the purpose of obtaining information to be submitted to the client's professional legal advisers for the purpose of obtaining advice upon pending or contemplated litigation; Sparke v Iama Ltd [2000] WASC 150 at 24.
Whilst legal professional privilege protects the confidentiality of certain communications connected with giving or obtaining legal advice or legal services, such privilege can also attach to documentation brought into existence by a client relevant to confidential communication with their legal adviser, even though that document may not in the end be provided to the legal adviser; Saunders v Commissioner, Australian Federal Police (1998) 160 ALR 469.
In order to establish a claim for privilege it must be demonstrated that the document or documents in question came into existence for the dominant purpose of the privilege. There is no precise or conclusive formula that must be utilised in this regard; Esso Australia Resources Ltd v Commissioner of Taxation of the Commonwealth of Australia [1999] HCA 67. In that case Callinan J, in concurring with the lead judgment of Gleason, Gaudron and Gummow JJ, observed "whether a purpose is a dominant purpose, is in my view, a matter to be objectively determined but the subject of purpose will always be relevant". In the end, however, in considering a claim of legal professional privilege one is concerned with the purpose for which the document or documents in issue were brought into existence; National Employers Mutual General Insurance Associated Ltd v Waind (1979) 141 CLR 648. Clearly such privilege exists so that legal advisers will obtain full and frank disclosure from their clients in order that justice can be served.
Application of relevant legal principles for this matter
It is submitted on behalf of the respondent that legal proceedings were not instituted by the respondent until an originating summons was issued on 27 November 1998 and therefore the appellant could not have anticipated such proceedings 11 months earlier in December 1997. I do not accept this submission, but rather take the view put forward on behalf of the appellant that if their insurer on behalf of the appellant turned its mind to the possibility of a common law claim then that is sufficient. It is correct that the documentation in relation to which privilege is claimed came into existence before common law proceedings were commenced by the respondent and in some instances well before such proceedings commenced. This was also at a time before solicitors on behalf of the appellant were instructed, but nonetheless given the history of the matter I accept the assertion in Mr Zanki's affidavit of 14 August 2001 that the insurer in engaging assessors were always mindful of the inevitability of common law proceedings being commenced in the context of a work related back injury. I consider it to be a matter of commonsense and sound business practice that in those circumstances it was appropriate for the appellant's insurer to investigate the circumstances of the respondent's alleged injury whilst the memories of witnesses were fresh and whilst those persons were still readily available. For that same reason no doubt the appellant's insurers considered it prudent to undertake surveillance to obtain a relatively contemporaneous view of the respondent's alleged disability should that become an issue in future legal proceedings. Whether or not a common law claim if ultimately brought by the respondent would succeed is not to the point.
I do not accept that Mr Zanki's affidavit in par 6 to par 8 inclusive is deficient. In my view in the circumstances of this case the fact that Mr Zanki was a case manager employed by the appellant's insurer in the workers' compensation/employer's indemnity section, in combination with his authority to swear the affidavit on behalf of the appellant, is a sufficient basis for him to depose to the matters contained in the affidavit. The purpose for which the reports were requested and obtained is in my opinion clearly stated in the contents of Mr Zanki's affidavit. It may well be that at the time the reports were commissioned and received the appellant through its insurer was vigorously defending the respondent's workers' compensation claim. The appellant does not resile from this fact and concedes that the documents were of assistance in the consideration and management of the workers' compensation claim. It is the case, however, as the appellant submits, that it is apparent from letters attached to the affidavit of the respondent that a number of the workers' compensation issues under consideration were being dealt with directly by the insurer and the appellant by way, for example, of medical reviews being arranged. I accept the submission that no evidence has been provided by the respondent that the reports in issue were obtained for the dominant purpose of dealing with the workers' compensation claim rather than for dominant purpose of submitting that information to legal advisers in the event that the respondent pursued a claim at common law. In view of this the Court cannot draw the inference that the relevant reports and documentation came into existence for a dual or multiple purpose.
I accept the appellant's contention that the focus is the dominant reason for which the documents in question came into existence. I do not consider that any subsequent arrangements that were made or even proposed for their use answers the question posed or privilege claimed.
On the information available to me in this matter I do not consider it to be appropriate or necessary for the Court to examine the documents in question and cause the deponents of the affidavits filed in support of the appellant's claim to be cross‑examined regarding their evidence. In my view there is sufficient material before the Court to support the appellant's argument and properly found their claim to privilege in relation to the documentation comprising items H2 to H6 inclusive. For that reason the appeal is allowed and those documents do not have to be produced by the appellant for inspection by the respondent.
0
7
1