McHugh v Australian Jockey Club Limited (No 3)

[2011] FCA 1053

FEDERAL COURT OF AUSTRALIA

McHugh v Australian Jockey Club Limited (No 3) [2011] FCA 1053

Citation:

McHugh v Australian Jockey Club Limited (No 3) [2011] FCA 1053

Parties:

BRUCE MCHUGH v AUSTRALIAN JOCKEY CLUB LIMITED, VICTORIA RACING CLUB LIMITED, AUSTRALIAN RACING BOARD LIMITED, RACING INFORMATION SERVICES AUSTRALIA PTY LIMITED, THOROUGHBRED BREEDERS AUSTRALIA LIMITED and AUSTRALIAN TURF CLUB LIMITED

File number:

NSD 1187 of 2009

Judge:

PERRAM J

Date of judgment:

12 September 2011

Catchwords:

PRACTICE AND PROCEDURE – Privilege – application for inspection of documents over which claim for privilege was made – purpose of communications

Legislation:

Evidence Act 1995 (Cth) s 119

Cases cited:

Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49 cited

Kennedy v Wallace (2004) 142 FCR 185 cited
National Crime Authority v S (1991) 29 FCR 203 cited
Trade Practices Commission v Sterling (1979) 36 FLR 244 cited

Date of hearing:

7 September 2011, 8 September 2011

Place:

Sydney

Division:

GENERAL DIVISION

Category:

Catchwords

Number of paragraphs:

10

Counsel for the Applicant:

Mr J Lazarus

Solicitor for the Applicant:

Brock Partners

Counsel for the Third Respondent:

Mr G Ng

Solicitor for the Third Respondent:

Mr T Price of Yeldham Price O'Brien Lusk

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION	NSD 1187 of 2009

BETWEEN:

BRUCE MCHUGH
Applicant

AND:

AUSTRALIAN JOCKEY CLUB LIMITED
First Respondent

VICTORIA RACING CLUB LIMITED
Second Respondent

AUSTRALIAN RACING BOARD LIMITED
Third Respondent

RACING INFORMATION SERVICES AUSTRALIA PTY LIMITED
Fourth Respondent

THOROUGHBRED BREEDERS AUSTRALIA LIMITED
Fifth Respondent

AUSTRALIAN TURF CLUB LIMITED
Sixth Respondent

JUDGE:	PERRAM J
DATE OF ORDER:	8 SEPTEMBER 2011
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1.The third respondent’s notice of motion be dismissed.

Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION	NSD 1187 of 2009

BETWEEN:

BRUCE MCHUGH
Applicant

AND:

AUSTRALIAN JOCKEY CLUB LIMITED
First Respondent

VICTORIA RACING CLUB LIMITED
Second Respondent

AUSTRALIAN RACING BOARD LIMITED
Third Respondent

RACING INFORMATION SERVICES AUSTRALIA PTY LIMITED
Fourth Respondent

THOROUGHBRED BREEDERS AUSTRALIA LIMITED
Fifth Respondent

AUSTRALIAN TURF CLUB LIMITED
Sixth Respondent

JUDGE:	PERRAM J
DATE:	12 SEPTEMBER 2011
PLACE:	SYDNEY

REASONS FOR JUDGMENT

1. The third respondent, the Australian Racing Board (‘the Board’), seeks access to 10 emails passing between the applicant, Mr McHugh, and a Mr Pemberton.  A subpoena was issued by the Board to Mr Pemberton and he produced a number of documents including the 10 emails to the Court but, at that time, a claim was made on Mr McHugh’s behalf that the emails were the subject of legal professional privilege.  The Board contests that claim.  On 8 September 2011 I upheld that claim.  These are my reasons for doing so.

2. Because what is involved is a question of access to documents, rather than the adduction of evidence, s 119 of the Evidence Act 1995 (Cth) does not apply and the matter is governed by the common law: Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49 at 59 [17] per Gleeson CJ, Gaudron and Gummow JJ. The common law requires nevertheless the application of a dominant purpose test: Esso at 73 [61] per Gleeson CJ, Gaudron and Gummow JJ and 107 [173] per Callinan J.

3. The emails in question passed between Mr Pemberton and Mr McHugh.  Some of them were also copied to a Mr Digby and, in one case, one of the emails was sent by Mr Digby.

4. Neither Mr Pemberton nor Mr Digby is a legal adviser to Mr McHugh.  Mr Pemberton is a well-known company director and is also a breeder of thoroughbred horses; Mr Digby was, so I was told, the ‘former keeper of the stud book’.  The stud book is a book recording the names of certain horses who are allowed, by dint of certain rules, to race at race tracks.  As I understood the matter, absence from the stud book had the practical effect of preventing a horse from running.  At the moment, horses which have been bred by the process of artificial insemination are not permitted in the stud book and hence are not permitted to race.  Mr McHugh’s contention that those rules are invalid is presently being tried before Robertson J.

5. At common law a communication passing between a party (such as Mr McHugh) and third parties (such as Mr Pemberton and Mr Digby) will be privileged if they are made with reference to litigation either anticipated or commenced, and at the request or suggestion of the party’s solicitor; or even without any such request or suggestion if they are made for the purpose of being put before the solicitor with the object of obtaining his or her advice or enabling him or her to prosecute or defend an action: Trade Practices Commission v Sterling (1979) 36 FLR 244 at 246 per Lockhart J.

6. There is no suggestion that the emails were sent at the request of the solicitor for Mr McHugh.  The issues which arise are, therefore, only two.  First:  at the time the emails were sent was there litigation anticipated or commenced?  Secondly:  were the emails sent for the purpose of being put before Mr McHugh’s solicitor with the object of obtaining his advice or of enabling him to prosecute the action?

7. The first question may be readily answered.  The 10 emails are described in a summary way in a schedule to the notice of motion.  In terms, four of those emails are described as being concerned with draft pleadings or applications.  The earliest of those is 30 September 2009.  Without examining the documents one can conclude that from that date litigation was anticipated.  As it happens the litigation commenced on 21 October 2009.    A fifth email described only as ‘notes of meeting’ post-dates 30 September 2009.  The remaining five emails pre-date 30 September 2009 and are described in the schedule as referring to advices rather than pleadings.  I have examined these documents.  It is evident that they relate directly to the litigation which was commenced on 21 October 2009.  It follows that all ten emails were created at times when litigation was anticipated.  The first limb is therefore satisfied.

8. As to the second question, the evidence from Mr McHugh’s solicitor establishes that Mr McHugh has on numerous occasions sought the assistance of Mr Pemberton on the formulation of his case and regards him as a trusted confidant and adviser with particular expertise in the operation of the thoroughbred racing and breeding industries.  Mr Digby, of whom mention has already been made, is also expert in these matters and, in fact, is being called by Mr McHugh as an expert witness on his behalf.  It is not difficult, in those circumstances, to imagine communications being made between Mr McHugh, on the one hand, and Messrs Pemberton and Digby, on the other, about the proposed litigation or that those communications might be directed to soliciting their advice to assist in Mr McHugh’s solicitor’s preparation of the case.

9. It was argued on the Board’s behalf that the claim for privilege needed to be properly articulated and could not just be an assertion.  Reference was made to National Crime Authority v S (1991) 29 FCR 203 at 211 per Lockhart J and Kennedy v Wallace (2004) 142 FCR 185 at 189 [12]-[13] per Black CJ and Emmett J. So much may, I think, be accepted. In this case, however, the claim for privilege does not rest merely upon the assertion that the emails were created for the dominant purpose of providing legal services in relation to anticipated litigation. To the contrary, it rests upon the evidence of Mr McHugh’s solicitor about the nature of Mr Pemberton’s and Mr Digby’s relationship to Mr McHugh and which I have described above; it also rests upon my examination of the documents in question.

10. In those circumstances, I conclude that the 10 emails are privileged.  The appropriate order is that the Board’s motion be dismissed.  I will make no order as to costs.

I certify that the preceding ten (10) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Perram.

Associate:

Dated:        12 September 2011