Mullett v Nixon

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

S CI 2013 01520

PAUL REDMOND MULLETT	Plaintiff
v
CHRISTINE NIXON	First Defendant
and
KIERAN WALSHE	Second Defendant
and
WAYNE TAYLOR	Third Defendant

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JUDGE:	J FORREST J
WHERE HELD:	Melbourne
DATE OF HEARING:	4 March 2016
DATE OF RULING:	4 April 2016
CASE MAY BE CITED AS:	Mullett v Nixon & ors (subpoena application)
MEDIUM NEUTRAL CITATION:	[2016] VSC 129

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PRACTICE AND PROCEDURE - Subpoena – Production of documents - Claim for privilege – Disclosure waiver – Issue waiver – Associated document waiver – Derivative waiver – Tort of misfeasance in public office.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr A Panna QC	Stephens Lawyers & Consultants
For the Defendant	Ms R Orr QC with Mr D McCredden	Victorian Government Solicitor’s Office
For the Chief Commissioner of Police	Dr McNicol QC with Mr C Tran	Herbert Smith Freehills

HIS HONOUR:

Introduction

The plaintiff, Mr Paul Mullett, is suing former Chief Commissioner Christine Nixon over his suspension as a police officer in November 2007. He alleges that her actions were unlawful and constitute misfeasance in public office. The trial is set down before T Forrest J for 10 May 2016.

Mr Mullett was suspended pursuant to s 79(1) of the Police Regulation Act 1958 (Vic) (‘the Act’). Ms Nixon sought legal advice concerning the suspension. She does not have any documents concerning that advice in her possession - they are held by her successors.

In response to subpoenas, both the current Chief Commissioner and Victoria Police have now produced, amongst others, 41 documents related to legal advice given to Ms Nixon concerning Mr Mullett’s suspension. Ms Nixon objects to the production of the documents on the basis that they are covered by legal professional privilege. The Chief Commissioner supports this claim.

Mr Mullett accepts that the documents attract legal professional privilege. However, he contends that any privilege has been waived by reason of:

(a) disclosure waiver as a result of ‘media’ statements made to the public in relation to Mr Mullett’s suspension; and

(b) issue waiver as Ms Nixon relies upon legal advice given to her concerning the suspension in order to justify her decision to suspend Mr Mullett.

If there is a waiver of legal professional privilege, a further question arises: whether there is any derivative waiver in relation to documents which may be integral to an understanding of the documents over which privilege has been waived.

In the event that there has been a waiver, there is a question over which documents (if any) I should inspect to determine the extent of the waiver.

Background to the claims for waiver

In November 2007, Mr Mullett was the secretary of the Police Association.

At the time of his suspension, Ms Nixon told the press that Mr Mullett may have committed offences under the Telecommunications (Interception and Access) Act 1979 (Cth) (‘the Telecommunications Act’) and the Police Integrity Act 2008 (Vic) (‘the OPI Act’).

Proceedings were commenced in 2013 by Mr Mullett against Ms Nixon, Kieran Walshe and Wayne Taylor claiming malicious prosecution and misfeasance in public office. This application only concerns Ms Nixon and the misfeasance claim arising out of the suspension.[1]
[1]Although the privilege claim is made by all defendants and the current Chief Commissioner of Police, the relevant parties for this application are Ms Nixon and the current Chief Commissioner of Police.

Principles for a case of misfeasance in public office

To understand the purpose of the application made by Mr Mullett, it is necessary to summarise the elements of the tort of misfeasance in public office:

(a) the defendant’s exercise of power must have been invalid or unlawful; and

(b) the exercise of power must have been accompanied by one or other of the following:

(i) an exercise of power knowing that he or she was acting in excess of power and intending to cause harm to the plaintiff;

(ii) reckless indifference as to whether the act was beyond power or whether it would cause harm to the plaintiff; or

(iii) reckless indifference as to whether the act was beyond power and there was a foreseeable risk of harm to the plaintiff.[2]

[2]Sanders v Snell (1998) 196 CLR 329; Poynder v Kent [2008] VSCA 245 [74].

Issues agreed upon

As stated above, there was no suggestion by counsel for Mr Mullett that each of the 41 documents was not prima facie the subject of legal professional privilege. It was also accepted that Mr Mullett carries the burden of proof in establishing that one or more of the forms of waiver he asserts have been established.

There is also no dispute that the documents are relevant to the issue of Mr Mullett’s suspension. This is a necessary pre-condition to the provision of documents in the first place.

The parties agreed that I should, if I think it necessary, inspect some of the documents.[3] However, counsel for the Chief Commissioner and Ms Nixon said that I should only look at four of the documents: those under tabs 2, 35, 36 and 37. Counsel for Mr Mullett said that I should examine all of the documents.
[3]AWB v Cole (No 5) (2006) 155 FCR 30 [41]-[45]; AED Oil Ltd v Back (No 3) [2010] VSC 403 [29].

The documents over which privilege is claimed

The following categories, (which were helpfully suggested by counsel for the Chief Commissioner) identify the classes of documents over which privilege is claimed:

(a) Briefs to counsel;

(b) Lawyers notes of conferences between clients and lawyers;

(c) Clients notes of conferences between clients and lawyers;

(d) Lawyers file notes of interaction with client;

(e) Legal advice given to the Chief Commissioner;

(f) Lawyers notes of conferences with or attendance on third parties;

(g) Emails between lawyer and client; and

(h) Miscellaneous.

Ms Nixon’s statements to the media

Mr Mullett was suspended by Ms Nixon on the morning of 15 November 2007 on full pay. That afternoon, Ms Nixon was interviewed on Sky Television (‘Sky interview’). The relevant parts of the interview are as follows:

COMPERE:We’re about to take you to Melbourne now where Victoria’s police Chief Commissioner Christine Nixon is holding a media conference following the completion of the public hearings into allegations of corruptions in Victoria’s police force by the Office of Police Integrity. So let’s go to that news conference now with Christine Nixon.
CHRISTINE NIXON: …is to suspend him and then we’ll obviously consider in more detail, once we get the Office of Police Integrity report as well, and other access to material, then we can determine how we might go forward.
But I believe there is sufficient evidence that he may have breached that legislation and the OPI legislation.

QUESTION: What are the offences for that…
CHRSITINE NIXON: They’re – look they’re…
QUESTION: …the penalties?
CHRISTINE NIXON: There are serious penalties and, obviously, the matter would have to go before the courts, and the decision would be one for – if he was convicted, it’s then a decision for the courts.

…
QUESTION:In broad terms, can you explain what the evidence is that made you believe that Mr Mullett was breaking the law?
CHRISTINE NIXON: I don’t intend to go into the evidence. I’ve had – taken legal advice by senior counsel who have been following these proceedings on my behalf. They’ve given me the understanding that they believe there is sufficient evidence that Mr Mullett may have committed offences under the Telecommunications Act and the OPI Act.

QUESTION: Could he go to jail over this?
CHRISTINE NIXON: That would be a matter for the courts.
QUESTION:You said you suspended him on full pay. The [indistinct] inquiry heard that he wasn’t being paid by the police force.
CHRISTINE NIXON: No, he’s not, but our provision of suspension requires me to suspend someone when I make this decision on full pay. Part of the reason I have to talk to the Police Association is about the matter of Mr Mullet’s pay. He shouldn’t be disadvantaged. I would be paying at senior salaries level – a senior sergeant salary, sorry, and that’s the level. So it’s a matter of me talking with The Police Association about what their intention might be.

QUESTION: Do you have an idea of when that meeting will be?
CHRISTINE NIXON: As soon as I can arrange it.

The following morning (16 November 2007) at 9:30am, Ms Nixon held a press conference at the Flinders Street Police Centre accompanied by the then Deputy Commissioner, Mr Simon Overland (‘Press conference’).

CHRISTINE NIXON: Good morning. Can I so thank you all for being here, particularly, for the media. I think for all of this, this last 10 days has been a very difficult time, not just for Victoria Police, but I think for the media as well.
Can I also welcome my colleagues from Corporate Committee who have come along; I thank you for your support. And also for those in Traffic and Transport and those in Corporate Communications, as well, who are here, thank you very much.
Simon and I are happy to answer any questions.

QUESTION: [Inaudible question]
CHRISTINE NIXON: At this stage we are still considering the material from the hearing and we’ll judge that and any other material that’s available to us before we make a decision.

QUESTION: [Inaudible question]
CHRISTINE NIXON: That’s actually not my decision. The decision is one that’ll be taken by the Police Association executive. What we’ve done is suspended him as a police officer; I have not withdrawn his leave without pay nor his right to undertake secondary employment. So that’s actually a decision for them.

QUESTION: [Inaudible question]
CHRISTINE NIXON: It’s not my decision. I think the association has to determine the best way for them to go forward so that they can continue to have a productive relationship with us in Victoria Police.

QUESTION: [Inaudible question]
CHRISTINE NIXON: I’m not interfering in an independent union’s business; what I’m doing is carrying out what I believe is my responsibility as the Chief Commissioner. I have assessed the evidence elicited during the hearings and I’ve made a decision and taken legal advice that says I should suspend Paul Mullett. That he is a member of the Victoria Police Association is another matter.

QUESTION: [Inaudible question]
CHRISTINE NIXON: The decision about Paul Mullett’s future as the secretary of the Police Association is not my decision; that’s theirs.
I think it will be very difficult for us, after having listened to the evidence over the last 10 days, been aware of the inquiry the Office of Police Integrity has been conducting since 14 September, then I think it will be very difficult for us to continue a positive relationship with him. But I think we have to have a positive relationship with the Police Association and I hope we can find a way forward. I have written to them this morning and asked for a meeting with the executive so that we can determine how we might move forward productively.

QUESTION:Over the past few weeks have you at all considered resigning?
CHRISTINE NIXON: I certainly have not. I think that this particular time has been difficult for all of us and I understand that. And it’s been disappointing. And I think a number of us feel betrayed. But I think my role at the moment is to continue in the job as a Chief Commissioner, to be able to work with the community and Victoria Police to continue on with our work and be able to move past this and productively go into our future and continue to reduce crime and deaths and serious injury on the road and ensure that the community is happy with Victoria Police.

QUESTION: Is it the most difficult time you’ve been through?
CHRISTINE NIXON: No, I think I’ve had some very difficult times within Victoria Police, I have to say. If you think back to that time, early days with corruption in the Drug Squad, obviously, underworld matters, a range of other matters. This is another issue and that’s what I’m paid to do.

QUESTION: Have you been out to get Paul Mullett?
CHRISTINE NIXON: No, I haven’t. And I really wish that people would understand that I have just gone about doing my job. I’ve not attempted to interfere in the association’s operation at all. I haven’t set out – this is not about a Paul Mullett versus Christine Nixon. In this particular instance, the evidence is in front of us from a hearing from Paul Mullett’s own words. And I’ve then judged those words and taken advice and determined he should be suspended on the basis of those statements.
QUESTION:So when he says that you are the [indistinct] surveillance, that it was improper, he’s lying?
CHRISTINE NIXON: I think he’s – I think Mr Mullett himself has suggested he might even be paranoid. But I certainly have done that. That would be entirely inappropriate. I’ve spoken to Paul Mullett directly, told him I’ve never done anything to undermine him or conducted inappropriate surveillance or any surveillance for that matter. But he continues to say this.
And I think during the actual hearings the Judge kept saying to Paul, this is not about all of your thoughts and views, this is about the facts.

QUESTION: [Inaudible question]
CHRISTINE NIXON: Look, again, I hope this isn’t about Paul Mullett versus Christine Nixon. This is actually going to be a matter that the courts will determine in the end. I think that…

[Bad noise in the microphones]
MALE SPEAKER: [Indistinct] terrible…
MALE SPEAKER: Yeah, turn that down.
CHRISTINE NIXON: I think that – I’ll go back. This isn’t an issue about Christine Nixon and Paul Mullett. The members, I hope, will listen to the transcripts, or read them, because they’re available, they’ll make a decision. They all took an oath, as I did, to do their job and I believe that they’ll do their job appropriately, as they are today.
And I ran into an officer in the life who simply said, Chief, I’m just getting on with my job, doing it as I did yesterday and I will tomorrow. And I think that’s what the members will do.

Directly after the Press conference, at about 10:20am, Ms Nixon participated in an interview (again accompanied by Mr Overland) with Mr Neil Mitchell on radio station 3AW (‘the Mitchell interview’). The relevant parts of that interview are as follows:

CHRISTINE NIXON: Well he’s, his evidence is such in terms of that investigation, that’s what he’s done. But, in regard to other matters, I have formed a view that I had sufficient to suspend him, and that he may have committed offences under two pieces of legislation – the Telecommunications Interception Act, as well as the Office of Police Integrity legislation.
NEIL MITCHELL:     Well he says he’s a copper who hates crooks. Do you believe him?
CHRISTINE NIXON: Um, yeah I do. I think Paul Mullett has a career that, that is distinguished. I think he’s the winner of two valour awards, but he hasn’t been a police officer since 1990, in terms of actually an operational police officer, so I have no real experience of that with him.
NEIL MITCHELL:     But if he hates crooks he wouldn’t be leaking information on a murder inquiry, sure, surely?
CHRISTINE NIXON: Um, look, I, that’s only speculation from me as to what he would do and what he wouldn’t do.
NEIL MITCHELL:     Well do you believe he leaked it or not?
CHRISTINE NIXON: Um, I don’t have sufficient evidence yet to come to a conclusion about that. This investigation is still continuing, and so I am watching, as many other people do.
NEIL MITCHELL:     Okay. He is suspended now. What happens with him next, from your point of view, not from the Association, from your point of view?
CHRISTINE NIXON: At this stage he is suspended with pay, and we will then talk with the Office of Police Integrity, and the matter of pursuing him through criminal charges is one that they may take forward, and they’ll obviously look to commence to develop the case, and put it before the courts.
NEIL MITCHELL:     Will you, you have the power to dismiss him even if no criminal charges are laid against him?
CHRISTINE NIXON: Um, I, we’ve, we’ve taken some advice on a set of charges – whether they’re discipline matters or criminal charges, at this stage we’ve advised him obviously of criminal matters, but we’re still considering our position on a range of other matters.

NEIL MITCHELL: Do you want him out of the police force?
CHRISTINE NIXON: Look I, I’ve, I personally believe that Mr Mullett has the right of a fair process and a fair trial. And so it would be too early for me to judge about whether he should be out of the organisation.

NEIL MITCHELL: But in the end it could be your call, couldn’t it?
CHRISTINE NIXON: It could be, and I would have weighed the evidence up. It would be either a hearing process or a, another form of legal process with the review involved. All of those things would be taken very calmly and thoughtfully as we proceeded forward.
NEIL MITCHELL: But when you, when you, you’ve said that you would find it very difficult to work with him again.

CHRISTINE NIXON: I…
NEIL MITCHELL: Do you mean as Secretary of the Association again, or in the job at all?
CHRISTINE NIXON: Look, I think as Secretary of the Association he’s the, the, you know, key person who deals with Victoria Police in the main out of the Association, and that this stage of course, him being suspended makes it difficult.
I’d hope to have discussions with the executive of the Association to figure out the way we might move forward.

NEIL MITCHELL: This is being portrayed as a power struggle between you and Paul Mullett.
Is there any truth to that at all?

CHRISTINE NIXON: No look it’s not true at all, and I know that he’s portrayed it as that way, and has done so for many years now.
It isn’t a power struggle. It never was. When I came into Victoria Police, I came from a history of working very closely with police associations. I had been a member for years and I had also had, held executive position.
I understood the value of working positively with the Police Association. And so I have tried to work in that fashion.
I think what happened was, was within the Association itself there were factions and, and some of them attempted to destabilise Mr Mullett.
I had nothing to do with these people, in any sense of encouraging them or, or doing anything else.
And so, the point is that I have tried to have a productive relationship – more recently as we negotiated the enterprise bargaining, it has been productive; we’ve been able to move forward.

…
NEIL MITCHELL: I wouldn’t – too sure. Now, we have Ashby gone; Linnell gone; Mullett suspended; Brian Rix, will he be suspended?
CHRISTINE NIXON: We’ll take into account the evidence that he’s given. We’re still having legal advice in the way we might go forward.

NEIL MITCHELL: Glen Weir has been suspended. Is his career over?
CHRISTINE NIXON: He again has been suspended on full pay. Material will then be collected for matters to be, for the court, and he has a perfect right to respond to those.

Relevant provisions of the Evidence Act 2008

Section 131A of the Evidence Act 2008 (Vic) (‘Evidence Act’) provides that an objection to the inspection of documents produced in response to a subpoena is to be determined in accordance with Part 3.10 of the Evidence Act.

In claiming privilege over the 41 documents, the Chief Commissioner and Ms Nixon relies upon client legal privilege under s 118 of the Evidence Act.

Section 122 of the Evidence Act deals with waiver and reads as follows:

Loss of client legal privilege—consent and related matters

(1)This Division does not prevent the adducing of evidence given with the consent of the client or party concerned.
(2)Subject to subsection (5), this Division does not prevent the adducing of evidence if the client or party concerned has acted in a way that is inconsistent with the client or party objecting to the adducing of the evidence because it would result in a disclosure of a kind referred to in section 118, 119 or 120.
(3)Without limiting subsection (2), a client or party is taken to have so acted if—
(a)the client or party knowingly and voluntarily disclosed the substance of the evidence to another person; or
(b)the substance of the evidence has been disclosed with the express or implied consent of the client or party.

(4)The reference in subsection (3)(a) to a knowing and voluntary disclosure does not include a reference to a disclosure by a person who was, at the time of the disclosure, an employee or agent of the client or party or of a lawyer of the client or party unless the employee or agent was authorised by the client, party or lawyer to make the disclosure.
(5)A client or party is not taken to have acted in a manner inconsistent with the client or party objecting to the adducing of the evidence merely because—
(a) the substance of the evidence has been disclosed—
(i)in the course of making a confidential communication or preparing a confidential document; or

(ii) as a result of duress or deception; or
(iii) under compulsion of law; or
(iv)if the client or party is a body established by, or a person holding an office under, an Australian law—to the Minister, or the Minister of the Commonwealth, the State or Territory, administering the law, or part of the law, under which the body is established or the office is held; or

(b)of a disclosure by a client to another person if the disclosure concerns a matter in relation to which the same lawyer is providing, or is to provide, professional legal services to both the client and the other person; or
(c)of a disclosure to a person with whom the client or party had, at the time of the disclosure, a common interest relating to the proceeding or an anticipated or pending proceeding in an Australian court or a foreign court.

(6)This Division does not prevent the adducing of evidence of a document that a witness has used to try to revive the witness's memory about a fact or opinion or has used as mentioned in section 32 (Attempts to revive memory in court) or 33 (Evidence given by police officers).

It is accepted that s 122(2) of the Evidence Act reflects the common law position that a client may waive privilege by acting inconsistently with the maintenance of that privilege. This was explained in Mann v Carnell:[4]

What brings about the waiver is the inconsistency, which the courts, where necessary informed by the consideration of fairness, perceive between the conduct of a client and the maintenance confidentiality; not some overriding principle of fairness operating at large.[5]

[4](1999) 201 CLR 1.

[5]Ibid 13 [29].

Section 126 of the Evidence Act relates to derivative waiver:

Loss of client legal privilege—related communications and documents
If, because of the application of section 121, 122, 123, 124 or 125, this Division does not prevent the adducing of evidence of a communication or the contents of a document, those sections do not prevent the adducing of evidence of another communication or document if it is reasonably necessary to enable a proper understanding of the communication or document.

Was there disclosure waiver over any of the documents

Disclosure waiver, under s 122 of the Evidence Act, arises when there is an inconsistency between publicly disclosing the gist of the contents of a particular document and attempting to maintain legal professional privilege over it.

The leading case on disclosure waiver is the High Court decision in Osland v Secretary to the Department of Justice.[6] Although this case dealt with common law disclosure waiver, it is accepted that the statements of principle are equally applicable to the application of s 122.
[6](2008) 234 CLR 275 (‘Osland’).

In Osland, the Attorney-General of this State obtained confidential legal advice from three eminent members of counsel in relation to a petition for mercy sought by Ms Osland. In the course of a press release, he referred to the advice in refusing the petition: ‘the advice recommends on every ground that the petition should be denied.’

The Court held that there was no inconsistency between the disclosure in the press release and the maintenance of privilege in the advice received: the press release did not identify the substance of the advice. The Court also held that the purpose of the disclosure was relevant, holding that the Attorney General’s statement was ‘to satisfy the public that due process had been followed in the consideration of the petition and that the decision was not based on political considerations’.[7]
[7]Ibid 298 [48].

The High Court concluded by stating that:

The Attorney-General was seeking to get the fullest information as to the process that had been followed, no doubt in order to deflect any criticism, while at the same time following the longstanding practice of not giving the reasons for the decisions. This did not involve inconsistency; and it involved no unfairness to the appellant.[8]

[8]Ibid; see also 312 [97] (Kirby J).

For issue waiver to arise, the substance or gist of the advice must be disclosed and used by a party. Even then, however, waiver will not be found to have occurred unless ‘the requisite inconsistency exists, between the disclosure on the one hand and the maintenance of confidentiality on the other’.[9] Further, ‘matters of fact and degree will, invariably, arise. On the other hand the mere revelation of the existence of legal advice without disclosure of the substance of that advice will not constitute waiver.’[10]
[9]Tsapatolis v Fuji Xerox Australia Ltd [2015] FCA 514, [9] (‘Tsapatolis’) quoting Secretary, Dept of Justice v Osland (2007) 95 ALD 380, 394 (Maxwell P).
[10]Tsapatolis [2015] FCA 514, [9]; see also Ampolex Limited v Perpetual Trustee Co (Canberra) Ltd (1996) 137 ALR 28, 34.

In a recent Federal Court decision, Tsapatolis,[11] the applicant sought various remedies arising from the termination of her employment by the respondent, Fuji. The applicant sought the production of legal advice given to Fuji, alleging that Fuji had waived client legal privilege by reason of a statement made by an employee which disclosed that Fuji sought legal advice and took this into account when terminating the applicant’s employment.
[11][2015] FCA 514.

The court referred to Bennett v Chief Executive Officer of the Australian Customs Service[12] and held that:

In order for a waiver to occur it is not necessary that the precise terms of the advice be disclosed in a witness statement or other document filed or prepared on behalf of the party in whom the privilege inheres.[13]

[12](2004) 140 FCR 101, 104.

[13]Tsapatolis [2015] FCA 514 [9].

The court ultimately found that there was no disclosure waiver holding that Fuji’s statement did not ‘descend, in the slightest detail, to expose the content of the legal advice to which she referred even by way of paraphrasing the conclusions reached in the advice.’[14]
[14]Ibid [11].

In this case, there are two important considerations which militate against a finding of inconsistency.

First, the gist or substance of the advice was not revealed by Ms Nixon. True it is that in the Sky interview Ms Nixon referred to the fact that counsel had advised that there was sufficient evidence that Mr Mullett may have breached specific Commonwealth and State legislation. Ms Nixon also referred in the Press conference to advice that supported her decision to suspend Mr Mullett and the fact that senior counsel had advised on the suspension. That, I think, in and of itself, is not enough to trigger disclosure waiver. Ms Nixon did not identify who provided the advice, nor the basis upon which it had been provided – other than making a reference to the two pieces of legislation. The disclosure is similar (but not identical) to those in Osland and Tsapatolis: merely alluding to the existence of an advice and its conclusion does not mean that there is disclosure waiver.

Second, it is clear from a reading of the transcript (and in particular those parts that I have extracted) that Ms Nixon was at pains to explain that she was fulfilling her function as Chief Commissioner in maintaining the authority of the police force in this State. She had a number of obligations under the Act which required her to justify and therefore provide an explanation to the public for her actions – similar to the requirement for the Attorney-General in Osland to explain his decision to deny the petition of mercy.

Counsel for Mr Mullett argued that as Ms Nixon convened the press conferences and voluntarily participated in the Sky interview and the Mitchell interview, this was conduct consistent with her voluntary disclosure of the advice in the context of a bitter industrial dispute. However, that proposition does not paint the full picture. Ms Nixon’s actions are equally consistent with that of her endeavouring to explain to the public at large the basis, in a general sense, for her decision to suspend Mr Mullett – which was part of her job.

It is trite that each case of disclosure waiver turns on its own circumstances. In my view, Ms Nixon, having used the powers under s 79(1) of the Act, was doing no more than explaining to the public the basis for suspending a serving officer. In doing so, she was fulfilling her obligations as the Chief Commissioner.

I am not satisfied that Mr Mullett has established a case for disclosure waiver over any of the documents.

Was there issue waiver over any of the documents?

As I mentioned earlier, it is accepted that Ms Nixon suspended Mr Mullett in reliance on the power under s 79(1) of the Act:

Where member believed to have committed a criminal offence punishable by imprisonment
(1)If the Chief Commissioner reasonably believes a member of the force to have committed an offence punishable by imprisonment the Chief Commissioner may cause an investigation into the matter under the criminal law to be commenced and may, at any time during that investigation—
(a) transfer the member to other duties; or
(b)direct the member to take any leave which has accrued to him or her; or

(c) suspend the member from the Force with pay.

It follows that there were two conditions of s 79 of the Act which had to be met for Ms Nixon to ‘lawfully’ suspend Mr Mullett under sub-section(1)(c):

(a) a reasonable belief on the part of the Chief Commissioner that Mr Mullett had committed an offence punishable by imprisonment (‘the reasonable belief condition’); and

(b) the existence of an investigation, under the criminal law, into the circumstances of that putative offence (‘the investigation condition’).

Section 123 of the Act should also be mentioned, as follows:

(1)A member of the force or a police recruit is not personally liable for anything necessarily or reasonably done or omitted to be done in good faith in the course of his or her duty as a member of the force or police recruit.
(2) Any liability resulting from an act or omission that, but for subsection (1), would attach to a member of the force or police recruit, attaches instead to the State.
(3) This section applies to acts or omissions occurring before as well as after the commencement of this section.

This provision has been considered on several occasions by judges of this court: Kyrou J in Slaveski v Victoria[15] and the Court of Appeal in Victoria v Horvath.[16] For present purposes, it suffices to refer to what was said by the Court of Appeal:

Although the provisions of s 123 are undoubtedly designed to be protective of police officers and, thus, to be given no narrow construction, they are nevertheless intended to operate so as to attach liability to the State only where that liability has been incurred for things necessarily or reasonably done in good faith in the course of duty. In other words, it seems to us that subs (1) of s 123 is intended to ‘carve out’ an area of conduct of police officers in respect of which they will be immune from personal liability and – despite imperfections of drafting – subs (2) is intending to attach to the State the liability against which the police officer is immunised by subs (1). [17]

Principles relevant to issue waiver

[15][2010] VSC 441; see also Matthews v SPI Electricity Pty Ltd(No 2) [2013] VSC 33.

[16](2002) 6 VR 326.

[17]Ibid 350 [62].

Issue waiver, like disclosure waiver, falls under s 122 of the Evidence Act and is dependent upon the existence of the requisite inconsistency which makes reliance on the privilege untenable.

However, whilst inconsistency is the underlying principle, the considerations in determining whether there has been such a waiver differ from those necessary for disclosure waiver. The test for issue waiver was set out by the Full Federal Court in Commissioner of Taxation v Rio Tinto Ltd[18] applying Mann v Carnell[19]:

The question is whether, by his particulars, the Commissioner made an assertion as part of his case that puts the contents of the privileged scheduled documents in issue, or necessarily lays them open to scrutiny, with the consequence that an inconsistency arises between the making of the assertion and the maintenance of the privilege. To answer this, the relevant assertions must be considered in their proper context. [20]

[18](2006) 151 FCR 341 (‘Rio Tinto’).

[19](1999) 201 CLR 1.

[20]Rio Tinto (2006) 151 FCR 341, 361 [68].

In DSE (Holdings) Pty Ltd v InterTAN Inc,[21] Allsop J said the test for implied issue waiver arises when:

the party entitled to the privilege makes an assertion (express or implied), or brings a case, which is either about the contents of the confidential communication or which necessarily lays open the confidential communication to scrutiny and, by such conduct, an inconsistency arises between the act and the maintenance of the confidence, informed partly by the forensic unfairness of allowing the claim to proceed without disclosure of the communication.[22]

[21](2003) 127 FCR 499, 519 [58].

[22]Ibid 518 [52] (emphasis added).

His Honour also said, in the context of where a state of mind is a relevant issue (for example, in undue influence cases):

The importance of the expression of views of Asprey J on implied waiver is the role of the party claiming the privilege raising the fact, nature and centrality of what took place in the (otherwise privileged and confidential) communication as an issue in the case.[23]

[23]Ibid; see also Thomason v Campbelltown Municipal Council (1939) 39 SR (NSW) 347; 56 WN (NSW) 108 (emphasis added).

In New South Wales Bar Association v Archer[24] Hodgson JA said:

... If a party claims to set aside a transaction, on which the party has had legal advice, for undue influence, but makes no assertion whatsoever that there was any inadequacy in the legal advice about the transaction or in the party's relevant legal understanding of the transaction, it seems to me that the mere fact that some other element of undue influence is alleged would not necessarily mean that legal professional privilege is waived. ...
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.[25]

[24](2008) 72 NSWLR 236.

[25]Ibid 251 (Hodgson JA) (emphasis added).

The points that arise out of these decisions are twofold. First, it is necessary that a party maintaining the privilege put in issue an assertion about a confidential communication which relates to a matter to be determined at trial. Second, in determining whether a party has put a matter in issue, the court is not confined to the pleadings. It is entitled to take into account the evidence put in a case,[26] and the steps taken in the conduct of a proceeding.[27] That process enables the court to determine whether there is the relevant inconsistent conduct on the part of the privilege holder. A party’s conduct, aside from the pleadings, ‘necessarily lays them [the contents of the privileged documents] open to scrutiny.’[28]

Issues to be resolved

[26]United States Surgical Corp v Hospital Products International Pty Ltd (unreported, Supreme Court, NSW, McLelland J, 13 October 1981); quoted with approval in Rio Tinto Ltd (2006) 151 FCR 341 [50].

[27]DSE (Holdings) Pty Ltd v Intertan Inc (2003) 127 FCR 499 [1], [13].

[28]Rio Tinto (2006) 151 FCR 341 [68].

Applying these principles to this application, I think that the following questions need to be answered:

(a) What are the issues to be determined at trial in the case against Ms Nixon for misfeasance in public office arising out of the suspension of Mr Mullett?

(b) Has Ms Nixon, by her pleadings or conduct, put in issue her state of mind in reaching the decision to suspend Mr Mullett?

(c) If yes to (b), is it inconsistent for Ms Nixon to maintain a claim for privilege over documents bearing on her state of mind in reaching the decision to suspend Mr Mullett?

Issues for determination at trial of the misfeasance in public office claim

I have set out at [10] the elements of the tort of misfeasance in public office. Of particular note is that Mr Mullett must, as part of his case, demonstrate that Ms Nixon acted unlawfully. As I mentioned earlier, this would involve, absent any other consideration, demonstrating that one or other of the two conditions of s 79 of the Act had not been complied with.[29]
[29]See [39] above.

The issues at trial can only be identified at this stage by recourse to the pleaded case of the parties. Of course, pleadings, as has been stated authoritatively on any number of occasions, are not an end in themselves, but a means to the end. They set the boundaries within which the case at trial will be run. It is therefore necessary in answering the first question to go to the pleaded case and defence to reach a conclusion as to what issues will require resolution at trial.

However, before I set out the details of the pleadings, I think it is helpful to commence with a precis of the arguments put by counsel.

Counsel for Mr Mullett submitted that references to legal advice in the defence and in particular, at paragraphs [30] and [71], went to the question of the state of mind of Ms Nixon at the time she made the decision to suspend Mr Mullett. This, it was said, was enough to amount to issue waiver.

Counsel for Ms Nixon, supported by counsel for the Chief Commissioner, submitted that the statement of claim focused solely on the second condition of s 79 (the investigation condition), and that the defence, in setting out what was said at a press conference, was merely responsive and did not amount to an assertion of reliance on legal advice. Counsel argued that the defence does not disclose any of the contents of a privileged document so as to put in issue the statements made by Ms Nixon.

I now turn to the pleadings. This application was conducted on the basis of the pleadings as they stood as at the date of the hearing on 4 March 2016.[30] In his statement of claim, Mr Mullett asserts the following against Ms Nixon under the heading, ‘Suspension of the Plaintiff from the Victoria Police’:
[30]Pursuant to my orders, Mr Mullett filed an amended statement of claim on 11 March 2016 which was responded to by an amended defence filed on 29 March 2016. No argument was addressed as to the amended pleadings and the parties were content (as far as I could tell) to conduct the application on the basis of the statement of claim as it stood as at 4 March 2016.

30. On or about 15 November 2007, the First Defendant, in her capacity as the Chief Commissioner of Police:

(a)suspended the Plaintiff from his employment with Victoria Police on full pay, pursuant to s 79(1) of the Police Regulation Act;
(b)stated that the reason for the Plaintiff’s suspension was based on “advice” that he had breached the “Telecommunications Interception Act” and provisions of the “OPI Act”;
(c)stated that she had assessed the evidence elicited during the hearings and made a decision and taken legal advice that said she should suspend the Plaintiff; and
(d)stated that “the evidence is in front of us from a hearing, from the Plaintiff’s own words” and that she then judged those words and had taken advice and determined he should be suspended on the basis of those statements.

In response, the defence (filed on behalf of the three defendants) asserts that:

30. (a) Nixon:
(i)admits that she suspended the Plaintiff from Victoria Police on or about 15 November 2007, with pay, pursuant to s 79(1) of the Police Regulation Act 1958 (Vic);
(ii)admits that on 15 November 2007, she made the following statements during a press conference:
(A)she had “taken legal advice by senior counsel” who believed that there was “sufficient evidence that the plaintiff may have committed offences under the Telecommunications Act and the OPI Act”;
(B)the Plaintiff “gave evidence, and I have looked at that”;
(C)“I have formed a view that I had sufficient to suspend [the Plaintiff]; and

(iii) otherwise does not admit the allegations; and
(b)insofar as paragraph 30 makes allegations against them, Walshe and Taylor do not admit the allegations.

Mr Mullett then pleads at paragraph [31] of the statement of claim:

31.At no relevant time prior to the said suspension on 15 November 2007:
(a)did the First Defendant cause or institute any investigation to be commenced into the alleged misconduct forming the basis for the said suspension either pursuant to s 79(1) or alternatively, s 71 of the Police Regulation Act in order to inform herself properly of the true facts of the alleged misconduct.
(b)did any member of Victoria Police question or interview the Plaintiff in respect of the alleged misconduct.

In response, paragraph [31] of the defence reads:

31.      (a)       Nixon:
(i)        admits the allegations in paragraph 31(b);
(ii)       otherwise denies the allegations in paragraph 31; and
(iii)      says further that prior to suspending the Plaintiff, she caused an investigation to be commenced into whether the Plaintiff had committed an offence punishable by imprisonment; and
(b) insofar as paragraph 31 makes allegations against them, Walshe and Taylor do not admit the allegations.

Paragraph [32] of the statement of claim pleads:

32.In the circumstances set forth in the preceding paragraph, the First Defendant wrongfully suspended the Plaintiff under s 79(1) of the Police Regulation Act because at the time of the said suspension she had not caused any investigation into the alleged misconduct.

In response, paragraph [32] of the defence reads:

(a)Nixon denies the allegations and refers to and repeats paragraph 31(a)(iii) of the above; and
(b) insofar as paragraph 32 makes allegations against them, Walshe and Taylor do not admit the allegations.

The case for misfeasance in public office against Ms Nixon is agitated again in paragraphs [61] and [62] of the statement of claim:

61.Further and alternatively, in the circumstances set forth in paragraphs 14 to 58 hereof, the First Defendant has acted in misfeasance of her public office as the Chief Commissioner of Police by:

(a) suspending the Plaintiff on 15 November 2007 without having caused any investigation by Victoria Police into the matter of the alleged misconduct, the subject of the criminal charges, and, therefore, such suspension was in the circumstances unlawful;

(b) authorising and instituting the criminal proceedings when there was no investigation by Victoria Police into the Plaintiff’s alleged misconduct, the subject of the criminal charges, prior to authorising and instituting the criminal proceedings.

62.In the circumstances set forth in the preceding paragraph, the First Defendant has acted with malice or recklessness in misfeasance of her public office as the Chief Commissioner of Police by:

(a) suspending the Plaintiff on 15 November 2007 without having caused any investigation by Victoria Police into the matter of the alleged misconduct, the subject of the criminal charges, and, therefore, such suspension was in the circumstances unlawful;

(b) authorising and instituting the criminal proceedings when there was no investigation by Victoria Police into the Plaintiff’s alleged misconduct, the subject of the criminal charges, prior to authorising and instituting the criminal proceedings.

61 In response, paragraphs [61] and [62] of the defence reads:

61. In response to paragraph 61:

(a) Nixon:
(i) denies the allegations; and
(ii) refers to and repeats paragraphs 31(a)(iii), 33 d 35(a) above;

(b) insofar as paragraph 60 makes allegations against them, Walshe andTaylor deny the allegations.

62. In response to paragraph 62:

(a)       Nixon:
(i)         denies the allegations; and
(ii)        refers to and repeats paragraphs 31(a)(iii), 33 and 35(a) above;

(b) insofar as paragraph 62 makes allegations against them, Walshe and Taylor deny the allegations.

Pausing here, if this was the whole of Mr Mullett’s pleaded case and Ms Nixon’s defence, I would hold that the question of Ms Nixon’s state of mind in suspending Mr Mullett is not an issue for determination at trial, because:

(a) the only attack in the pleaded case of Mr Mullett relates to the investigation condition of s 79 of the Act; whilst there is reference to the public statements of Ms Nixon, there is no specific allegation – either implied or express – that Ms Nixon did not have a reasonable belief that Mr Mullett may have committed a relevant offence; and

(b) the contents of paragraph [30] of the defence of Ms Nixon are merely responsive to the allegations contained in the statement of claim. They do not set up a defence based upon the reasonableness of Ms Nixon’s decision or her state of mind.

But that is not the end of the matter. Paragraph [71] of the defence is not responsive. It sets up a new issue: the transfer of liability from Ms Nixon to the State. It reads as follows (emphasis added):

71. Further,

(a) if the Plaintiff is entitled to damages for any act or omission of Nixon, Nixon says:

(i) at all material times she was acting (or omitting to act) necessarily or reasonably in good faith in the course of her duty as a member of Victoria Police; and

(ii) she is not liable for any such damages by operation of s 123 of the Police Regulation Act 1958 (Vic);

(b) if the Plaintiff is entitled to damages for any act or omission of Walshe, Walshe says:

(i) at all material times he was acting (or omitting to act) necessarily or reasonably in good faith in the course of his duty as a member of Victoria Police; and

(ii) he is not liable for any such damages by operation of s 123 of the Police Regulation Act 1958 (Vic);

(c) if the Plaintiff is entitled to damages for any act or omission of Taylor, Taylor says:

(i) at all material times he was acting (or omitting to act) necessarily or reasonably in good faith in the course of his duty as a member of Victoria Police; and

(ii) he is not liable for any such damages by operation of s 123 of the Police Regulation Act 1958 (Vic).

Paragraph [71(a)] of the defence was the subject of a request for further and better particulars. Ms Nixon provided the following (emphasis added):

5. Nixon suspended the Plaintiff from Victoria Police on or about 15 November 2007 in accordance with s 79(1) of the Police Regulation Act 1958, in that:

(a) she reasonably believed that the Plaintiff had committed one or more offences punishable by imprisonment;

(b) she had caused an investigation into whether the Plaintiff committed an offence punishable by imprisonment to be commenced; and

(c) the suspension of the Plaintiff was with pay.

6. Nixon’s belief that the Plaintiff had committed one or more offences punishable by imprisonment was informed by:

(a) discussions between Nixon and the Director of the Office of Police Integrity, and other representatives of the Office of Police Integrity, concerning the Office of Police Integrity’s investigation into the conduct of the Plaintiff.

(b) Nixon’s review of transcripts of public hearings conducted by the Office of Police Integrity relating to the conduct of the Plaintiff;

(c) briefings Nixon received from Assistant Commissioner Luke Cornelius, who attended hearings conducted by the Office of Police Integrity and received documents from the Office of Police Integrity that related to the conduct of the Plaintiff; and

(d) oral legal advice that Nixon received in November 2007 in relation to her power to suspend the Plaintiff under s 79(1) of the Police Regulation Act 1958.

This allegation, as particularised, raises an issue for determination at trial: whether Ms Nixon can shift her liability to the State of Victoria under s 123. To do so, she must establish that she acted in good faith which means, as the particulars demonstrate, that Ms Nixon will contend that she made the decision to suspend Mr Mullett in accordance with the two conditions of s 79 (the reasonable belief and investigation conditions). I do not accept that this is an issue solely between Ms Nixon and the State, as counsel for the Chief Commissioner suggests. The decision of the Court of Appeal in Horvath[31] demonstrates clearly that this is an issue that affects Mr Mullett’s claim.
[31](2002) 6 VR 326.

Paragraph [71] of the defence and paragraphs [5] and [6] of the further and better particulars (which identify the existence of legal advice as a basis for Ms Nixon’s belief) raise squarely the state of mind of Ms Nixon at the time she made the decision to suspend Mr Mullett. The particulars specifically allege that she formed a reasonable belief as to the commission of the relevant offences.

It follows that the state of mind of Ms Nixon at the time she made her decision is pivotal to establishing the reasonable belief condition of whether she acted lawfully under s 79 of the Act.

It is not to the point that ultimately it may be in Mr Mullett’s financial interest for Ms Nixon to pass on any liability to the State under s 123. What is germane for present purposes is that this issue will require determination at trial.

For completeness, I should add that it matters not for the purpose of issue waiver that Ms Nixon did not refer to the substance of the advice – the considerations for determining whether there has been issue waiver are distinct from those for disclosure waiver.

Has Ms Nixon put her state of mind in issue?

The answer is patent. By the plea contained in paragraph [71] of the defence, and paragraphs [5] and [6] of the further and better particulars, Ms Nixon put in issue her reasonable belief regarding the sufficiency of evidence as to Mr Mullett’s suspension.

Is it inconsistent for Ms Nixon to claim privilege over the documents relevant to her decision to suspend Mr Mullett?

As I set out earlier, in determining whether the relevant inconsistency exists, it is appropriate to examine the pleadings and any other evidence relevant to the privilege holder’s conduct.

I have dealt with the content of the pleadings.

In the Sky interview (set out at [15]) when Ms Nixon said that she had been given legal advice by senior counsel which had led her to the understanding that there was sufficient evidence that Mr Mullett may have committed offences under the Telecommunications Act and the OPI Act, this was far more than simply saying she had legal advice per se. Ms Nixon identified, to use the words of Rio Tinto,[32] the basis for her satisfaction underlying her decision to suspend Mr Mullett. It was far more than merely acknowledging the existence of such advice.
[32](2006) 151 FCR 341, 362 [72].

Similarly, in the Mitchell interview, Ms Nixon said not only that she had formed a view that Mr Mullett may have committed offences under two pieces of legislation but, in that context, that she had taken ‘some advice on a set of charges’.

As in RioTinto, it is not simply that Ms Nixon asserted her state of mind, and the basis for her satisfaction as to the appropriateness or reasonableness of her decision.[33] Rather, Ms Nixon expressly said[34] that she took into account matters that may be evidenced by the privileged documents,[35] and thereby laid open the relevant documents to scrutiny.[36] A combination of the assertion in paragraph [71] of the defence and paragraphs [5] and [6] of the further and better particulars, in conjunction with these public statements, went beyond a statement that Ms Nixon had simply taken legal advice in the course of making her decision.
[33]Ibid 360-361 [67], 362 [71].
[34]See [15] above.
[35]Rio Tinto (2006) 151 FCR 341, 360 [65].
[36]Ibid 361 [68].

I reject the suggestion made by counsel for the Chief Commissioner that the determination on this issue will be confined to the fact of legal advice alone. It is clear that the assertion made by Ms Nixon was about the nature of the advice she had received and was made for the purpose of vindicating the reasonableness of her actions. This conduct is inconsistent with maintenance of confidentiality over the documents which relate to the advice given to her concerning the conduct of Mr Mullett that may have given rise to criminal offences. That advice is not confined to oral advice as mentioned in paragraph [71] of the defence, as it is clear that Ms Nixon was generally putting in issue the legal advice taken by her as to Mr Mullett’s suspension.

There is sufficient inconsistency to conclude that there has been issue waiver over a number of the 41 documents over which privilege is claimed.

Which documents are subject to waiver?

In my opinion the waiver is limited to those documents which relate directly to advice actually given to Ms Nixon as to her exercise of the power to suspend Mr Mullett under s 79 of the Act. Other documents which relate to persons other than Mr Mullett are not subject to the waiver. Nor are internal documents within Victoria Police or the Victorian Government Solicitor’s Office relating to Mr Mullett’s suspension.

However, I do not accept the submission of counsel for the Chief Commissioner that the waiver is limited to oral legal advice and thus confined to the documents behind tabs 2, 35, 36 and 37.

As I mentioned earlier, Ms Nixon’s conduct involves a waiver over advice received concerning Mr Mullett’s suspension, not limited to that given shortly prior to the media statements. It would be artificial to limit the extent of the waiver as proposed by counsel for the Chief Commissioner.

Accordingly, the waiver encompasses written advice provided to Ms Nixon about the exercise of her powers under s 79, as well as any record of oral advice given to her on the issue. No other documents are the subject of issue waiver unless covered by derivative waiver.

The only way in which I could determine the documents which are the subject of the waiver is by examination of each of the documents. The descriptions provided are helpful, but not conclusive.

As such, I did not confine myself in that examination to the four documents identified by counsel for the Chief Commissioner and Ms Nixon as being the subject of waiver (if so found). I regard the basis upon which the four documents were identified as being too limited. In addition, it would have been unfair to Mr Mullett for me to do so as neither he, nor his counsel, have been given the opportunity to inspect the documents and determine whether those identified are the only ones which bear directly on the decision to suspend Mr Mullett.

Having completed the inspection, I have concluded that the following documents should be produced (and have referred to them according to their allotted tab numbers):

(a) Tab 2 - Typed file note of Kirsty McIntyre of VGSO from conference on 15 November 2007 with Peter Hanks QC, Chief Commissioner Nixon, Assistant Commissioner Overland, Assistant Commissioner Cornelius, Jonathan Spear, Wendy Steendam and Fin McRae. Both typed and handwritten versions. (The Document behind tab 37 was said to be the handwritten version, however it was not included in the folder).

(b) Tab 37 - Handwritten notes of Kirsty McIntyre from the Victorian Government Solicitor’s Office of meeting with Overland, Assistant Commissioner Cornelius, Jonathan Spear, Wendy Steendam and Fin McRae on 15 November 2007. (The version provided to the court is a duplicate of tab 2, however, this document is not the handwritten version of tab 2, as it was described in the index provided).

(c) Tab 6 - File note of Kirsty McIntyre of her conference with Chief Commissioner Nixon, Assistant Commissioner Overland and Assistant Commissioner Cornelius on 13 November 2007. Both typed and handwritten versions. (The Document behind tab 33 is the handwritten version of this document).

(d) Tab 33 - Handwritten notes of Kirsty McIntyre of the Victorian Government Solicitor’s Office of her conference with Chief Commissioner Nixon, Assistant Commissioner Overland and Assistant Commissioner Cornelius dated 13 November 2007.

(e) Tab 12 - Handwritten notes of Stephen Lee of VGSO of his conference with Chief Commissioner Nixon and Assistant Commissioner Cornelius on 9 October 2007 at 2.30 PM.

(f) Tab 14 - Handwritten notes of Stephen Lee of VGSO of his conference with Chief Commissioner Nixon on 17 September 2007.

(g) Tab 17 - Written advice of Peter Hanks QC with handwritten annotations by Hanks QC and Stephen Lee of VGSO of 24 October 2007.

(h) Tab 18 – Advice from Peter Hanks QC with handwritten annotation, attaching advice.

(i) Tab 27 – Handwritten notes of Stephen Lee of VGSO of his conference with Chief Commissioner Nixon, Assistant Commissioner Overland and Assistant Commissioner Cornelius on 28 September 2007.

(j) Tab 34 – Printed Microsoft Outlook record of meeting on 9 October 2007 between Peter Hanks QC, Stephen Moore, Chief Commissioner Nixon, Assistant Commissioner Overland, Assistant Commissioner Cornelius and Stephen Lee of VGSO, with handwritten notes of Assistant Commissioner Cornelius. An undated memorandum of advice of Peter Hanks QC is also attached to the meeting records.

(k) Tab 35 - Typed notes of Fin McRae, director of Legal Services, of meeting on 15 November 2007 with Peter Hanks QC, Kirsty McIntyre of the VGSO, Chief Commissioner Nixon, Assistant Commissioner Overland, Assistant Commissioner Cornelius, Jonathan Spear and Wendy Steendam; and

(l) Tab 36 - Handwritten notes of Fin McRae of meeting on 15 November 2007 with Peter Hanks QC, Kirsty McIntyre of the VGSO, Chief Commissioner Nixon and Assistant Commissioner Overland, Assistant Commissioner Cornelius, Jonathan Spear and Wendy Steendam. I should add the following explanation as to the undated advice of counsel behind Tab 18. Although it does not refer to Mr Mullett by name, it is clearly directed to the question of the suspension of a member and the provisions of the Telecommunications Act which were relied upon by Ms Nixon to suspend Mr Mullett.

Is there derivative waiver of any part, and if so what documents?

Section 126 of the Evidence Act reads as follows:

Loss of client legal privilege—related communications and documents

If, because of the application of section 121, 122, 123, 124 or 125, this Division does not prevent the adducing of evidence of a communication or the contents of a document, those sections do not prevent the adducing of evidence of another communication or document if it is reasonably necessary to enable a proper understanding of the communication or document.
Example
A lawyer advises his client to understate her income for the previous year to evade taxation because of her potential tax liability "as set out in my previous letter to you dated 11 August 1994". In proceedings against the taxpayer for tax evasion, evidence of the contents of the letter dated 11 August 1994 may be admissible (even if that letter would otherwise be privileged) to enable a proper understanding of the second letter.

This statutory form of derivative waiver in s 126 is different from that at common law as it ‘is not cast in terms of either unfairness or inconsistency (or for that matter, inconsistency informed by notions of unfairness).’[37]
[37]Sugden v Sugden (2007) 70 NSWLR 301, 319 [93].

I adopt the following statement of principle of Derham AsJ in Matthews v SPI Electricity Pty Ltd:[38]

In Towney v Minister for Land & Water Conservation (NSW),[39] Sackville J made a number of pertinent observations about this section. First, that the test set out is an objective test; secondly, that its operation must be assessed according to its terms and not on the basis that it in some way reflects the pre-existing common law; and thirdly that it was clear in his view that a mere reference in a subject document to another communication or document, of itself, does not necessarily result in a loss of privilege attaching to the subject document. The application of s 126 ultimately depends on the degree and manner in which the subject document assists in a proper understanding of the other communication or document. In relation to the meaning of ‘proper understanding’, Sackville J said:
The dictionary definition of ‘proper’ includes ‘complete or thorough’; the definition of ‘understand’ includes ‘to apprehend clearly the character or nature of’ and ‘to grasp the significance, implications or importance of’: Macquarie Dictionary.

[38][2013] VSC 33 [42].

[39](1997) 147 ALR 402, 414.

In ML Ubase Holdings Co Ltd v Trigem Computer Inc,[40] it was said that in the application of s 126:

… one starts by looking at the substantive document (made admissible under s 122 or another of the applicable sections) and asking whether, in order to understand it thoroughly, it is necessary to know what is in the associated material.

[40](2007) 69 NSWLR 577, 593 [46].

Finally, notwithstanding the restrictive nature of statutory provision (as opposed to the previous common law position), it is clear that it is not necessary that the derivative document be referred to in the primary document. What is necessary is whether the derivative document assists in reaching a proper understanding of the primary document. The converse also holds good. As Derham AsJ held, a reference to a potentially derivative document in a primary document does not in and of itself mean that the derivative document is required to be produced unless it goes to ensuring an understanding of the primary document.

Bearing these principles in mind, I have examined the documents that may fall into the derivative category.

I think that each of the briefs to counsel are genuinely derivative. To understand the advice provided to Ms Nixon by counsel and her lawyers as to Mr Mullett’s suspension, it is necessary to understand upon what counsel was instructed to advise. The advices, whilst complete, are not specific and on their own, do not enable the reader to determine what exactly is being advised in relation to Mr Mullett. The provision of the briefs enables a proper appreciation of the nature of the advice that was given to Ms Nixon and upon which she says she relied in suspending Mr Mullett pursuant to s 79 of the Act.

The following are relevant to the advice given to Ms Nixon to suspend Mr Mullett:

(a) Tab 4 – Brief to advise in conference to Peter Hanks QC with attachments to brief dated 14 November 2007.

(b) Tab 7 - Brief to advise in conference to Peter Hanks QC dated 14 November 2007.

(c) Tab 16 – ‘Two draft briefs to Peter Hanks QC. One to advise generally and draw documents dated 19 September 2007 and the other to draw notice dated 31 October 2007. Handwritten annotations on each’. I am not convinced that the description of these documents is accurate. There are in fact four briefs to counsel (two to senior counsel and two to junior counsel); none appear to be drafts (one has been marked by counsel) and each appears to have been the subject of advice or documents subsequently prepared by counsel.

Conclusion

There has been no disclosure waiver over the privileged documents.

There has, however, been an issue waiver over the documents behind tabs 2, 6, 12, 14, 17, 18, 27, 33, 34, 35, 36, and 37.

There is also derivative waiver over the documents behind tabs 4, 7 and 16.

The remaining documents attract legal professional privilege.

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Citations

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4 April 2016