Minister for Finance v C & I Rogers Pty Ltd
[2004] VSC 370
•28 September 2004
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
No. 9155 of 2003
| THE MINISTER FOR FINANCE | Applicant |
| v | |
| C. & I. ROGERS PTY LTD | Respondent |
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JUDGE: | OSBORN J | |
WHERE HELD: | MELBOURNE | |
DATE OF HEARING: | 23 SEPTEMBER 2004 | |
DATE OF JUDGMENT: | 28 SEPTEMBER 2004 | |
CASE MAY BE CITED AS: | THE MINISTER FOR FINANCE v C & I ROGERS PTY LTD | |
MEDIUM NEUTRAL CITATION: | [2004] VSC 370 | 1st Revision: 28 September 2004 |
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Discovery – Experts reports – Waiver of professional privilege.
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APPEARANCES: | Counsel | Solicitors |
| For the Applicant | Mr C. Porter | Deacons |
| For the Respondent | Mr D. Christie | Ryan Maloney Anderson |
HIS HONOUR:
In this matter the respondent claimant for compensation seeks discovery of two classes of documents:
"(a)the report of Sinclair Knight Merz dated 21 February 2001; and
(b)"all supporting documentation relied upon by and provided to Mr Brian Dudakov and Mr Stephen Thomas of Urbis Pty Ltd in preparing their report dated August 2004."
I shall deal with the second category first. The application made to the Court was ultimately limited to the valuation report of Eishold McEniry Eason ("Eishold") referred to at paragraph 4.1 of the report of Urbis Pty Ltd ("Urbis") comprising Exhibit LCA15 tendered to me.
It is apparent that the Eishold report was supplied to Urbis as part of the instructions to Urbis for the purpose of obtaining expert evidence and was utilised by the Urbis valuers in part as providing the factual basis for the Urbis valuation. In particular the Eishold report described the premises as they were as at the date of acquisition. The Urbis valuers did not view the site until after the improvements upon the site at the date of acquisition had been demolished.
Mr Porter concedes that that part of the Eishold report which describes the property as it was at the date of acquisition is properly discoverable. Mr Christie contends that the Minister has wholly waived such professional privilege as may otherwise have attached to the document.
The concept of waiver was addressed by the High Court in Mann v Carnell[1]:
"At common law, a person who would otherwise be entitled to the benefit of legal professional privilege may waive the privilege. It has been observed that 'waiver' is a vague term, used in many senses, and that it often requires further definition according to the context (Ross T. Smyth & Co Ltd v T.D. Bailey, Son & Co [1940] 3 All ER 60 at 70; Larratt v Bankers & Traders Insurance Co Ltd (1941) 41 SR (NSW) 215 at 226; The Commonwealth v Verwayen (1990) 170 CLR 394 at 406, 422, 467, 472). Legal professional privilege exists to protect the confidentiality of communications between lawyer and client. It is the client who is entitled to the benefit of such confidentiality, and who may relinquish that entitlement. It is inconsistency between the conduct of the client and maintenance of the confidentiality which effects a waiver of the privilege (Cross on Evidence, 5th Aust ed (1996), par 25005; Attorney-General (NT) v Maurice (1986) 161 CLR 475 at 497-498). Examples include disclosure by a client of the client's version of a communication with a lawyer, which entitles the lawyer to give his or her account of the communication (Benecke v National Australia Bank (1993) 35 NSWLR 110), or the institution of proceedings for professional negligence against a lawyer, in which the lawyer's evidence as to advice given to the client will be received (Lillicrap v Nalder & Son (a firm) [1993] 1 WLR 94; [1993] 1 All ER 724).
Waiver may be express or implied. Disputes as to implied waiver usually arise from the need to decide whether particular conduct is inconsistent with the maintenance of the confidentiality which the privilege is intended to protect. When an affirmative answer is given to such a question, it is sometimes said that waiver is 'imputed by operation of law' (eg. Goldberg v Ng (1995) 185 CLR 83 at 95). This means that the law recognises the inconsistency and determines its consequences, even though such consequences may not reflect the subjective intention of the party who has lost the privilege. Thus, in Benecke v National Australia Bank ((1993) 35 NSWLR 110), the client was held to have waived privilege by giving evidence, in legal proceedings, concerning her instructions to a barrister in related proceedings, even though she apparently believed she could prevent the barrister from giving the barrister's version of those instructions. She did not subjectively intend to abandon the privilege. She may not even have turned her mind to the question. However, her intentional act was inconsistent with the maintenance of the confidentiality of the communication. 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."
[1][1999] HCA 66 (21 December 1999) per Gleeson CJ, Gaudron, Gummow and Callinan JJ at [28], [29]
In Standard Chartered Bank of Australia Ltd v Antico[2] Hodgson J stated:
“If a party, by pleadings or evidence, expressly or impliedly makes an assertion about the content of confidential communications between that party and a legal adviser, then fairness to the other party may mean that this assertion has to be taken as a waiver of any privilege attaching to the communication."[3]
[2](1993) 36 NSWLR 87
[3]Ibid at 94-95
Mr Christie relied upon the decision of the Queensland Court of Appeal in Interchase Corporation Ltd (In Liq) v Grosvenor Hill (Queensland) Pty Ltd (No. 1)[4]. In that case Pincus JA reviewed relevant authority and stated:
"The principle which emerges from these cases is that documents used by an expert to form an opinion are not the subject of legal professional privilege, whether or not they emanated from the party claiming privilege."
[4][1999] 1 Qd R 141
The concession made by Mr Porter as to partial waiver in the present case reflects the above principles. It implicitly concedes that in part the Eishold report is incorporated in the Urbis report in respect of which privilege has itself been waived.
Although the decision of the Court of Appeal in British American Tobacco Australia Services Ltd v Cowell (as representing the Estate of McCabe (deceased))[5] (“the BAT case”) reflects the fact that questions of waiver of legal professional privilege may raise difficult questions of fact, nevertheless in the present case I do not believe that the distinction put forward on behalf of the acquiring authority can be sustained. In the BAT case the Court of Appeal stated at [121]:
“A reference in one letter of advice to an earlier letter of advice does not expose the latter to scrutiny by the other party to litigation merely because legal professional privilege is waived in relation to the former: implied waiver is not so generous a doctrine. As we apprehend it, where legal professional privilege is waived in relation to one piece (or part) of advice, the privilege is impliedly waived in relation to another if - and only if - that other is necessary to a proper understanding of the first.”
In the present case I am satisfied that the Eishold report is necessary to a proper understanding of the of the Urbis report, further the Urbis opinion is expressly predicated upon facts stated in the Eishold report. Moreover in my view the whole of the Eishold report is properly to be regarded as stating the facts forming the basis of and necessary to a proper understanding of the Urbis report.
[5][2002] VSCA 197
The reality is that the valuation of a property is in a fundamental sense a description of certain of its characteristics. Likewise the intermediate steps undertaken in arriving at a valuation involve description of the property. Thus, if a property is described as having improvements comparable to the improvements on other properties, or the improvements are valued by the summation method, each involves a description of the improvements upon the property. In turn, the ascription of value itself to the property involves an implied description of the improvements upon the property by reference to a particular attribute namely value. It therefore seems to me entirely artificial to suggest that the Urbis valuers must be taken to have had regard only to "the description of the property" in the narrowest sense contained in the Eishold report. It was, of course, open to the acquiring authority to supply Urbis with part only of the Eishold report in the first place. If this course had been undertaken then the present dilemma would not arise. Because the acquiring authority supplied the whole of the report to the Urbis valuers, however, it seems to me that it cannot now be unscrambled. The reality is that the description of the property and the prior valuation were inextricably bound up with each other and in my view privilege was waived with respect to the report as a whole once the Urbis report was itself put forward by the authority in this case.
I turn back then to the first document sought by the summons. I am satisfied that the SKM report was brought into existence well prior to the service of a notice of acquisition. It was produced in the course of direct negotiations between the claimant and officers of the acquiring authority. It was produced after the claimant had expressly requested assistance in the quantification of its claim. Further, it was produced pursuant to an arrangement that SKM would be given access to the claimant's land and relevant information by the claimant on the one hand but the claimant would thereafter be provided with a copy of the resultant report on the other hand.
I am satisfied that the claimant's evidence as to this arrangement should be accepted on the balance of probabilities firstly, because I prefer the evidence of direct recollection by Mr Rogers to that of usual practice from the departmental officer. Secondly, Mr Rogers’ recollection is consistent with and tends to be confirmed by the written communications sent at the time in issue. Conversely, such communications are either inconsistent with the case now put forward on behalf of the Minister or are in no way directly supportive of it.
In summary the report:
·was not made between lawyer and client;
·was not made for the purpose of confidential advice; and
·was not made for the dominant purpose of litigation in the sense explained by Batt JA in Mitsubishi Electric v VWA[6].
[6](2002) 4 VR 332
Accordingly, the acquiring authority cannot sustain a claim of legal professional privilege with respect to the SKM report.
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