OneSteel Trading Pty Limited v Capital Steel & Pipe Pty Limited (Judgment 2)
[2007] NSWDC 127
•8 June 2007
CITATION: OneSteel Trading Pty Limited v Capital Steel & Pipe Pty Limited (Judgment 2) [2007] NSWDC 127 HEARING DATE(S): 7 June 2007
JUDGMENT DATE:
8 June 2007JURISDICTION: Civil JUDGMENT OF: Rolfe DCJ DECISION: The Courts rejects the tender of MFI 1 CATCHWORDS: Defendant sought to tender portions of Plaintiff's statements said to contain admissions - Tender made on basis that once statements were served there was no restriction on their use - Consideration of application of ss 119 and 122 of the Evidence Act 1995 and the Usual Order for Hearing in the Commercial List - Tender rejected on the basis that the statements had been produced under compulsion of law and the privilege attaching to them had not been lost LEGISLATION CITED: Evidence Act 1995 CASES CITED: Baulderstone Hornibrook Engineering Pty Limited v Gordian Runoff Limited (2006) NSWSC 223
Austress Freyssinet Pty Ltd v Marlin Internation Pty Ltd (2002) NSW SC 958; BC 200206111
Barristers' Board of Western Australia v Tranter Corp Pty Ltd (1976) WAR 65
Re Margetson v Jones (1897) 2 Ch314
Leaders Shoes (Aust) Pty Ltd v National Insurance Co of New Zealand (1968) 1 NSWR 344
In the Marriage of Crowe (1988) FLC 91-983
Akins v Abbey Group Ltd (1998) 43 NSWLR 539
Sevic v Roarty (1998) 44 NSWLR 287
Dubbo City Council v Barrett (2003) NSW CA 267; BC 200305990
Home Office v Harman (1983) 1 AC 280
Liberty Funding Pty Limited v Phoenix Capital Limited (2005) 218 ALR 283
State Bank of South Australia v Smoothdale (No. 2) Ltd (1995) 64 SASR 224PARTIES: OneSteel Trading Pty Limited (Plaintiff)
Capital Steel & Pipe Pty Limited (Defendant)FILE NUMBER(S): 5424/06 COUNSEL: J E Sexton SC and R J Cheney (Plaintiff)
A J McInerney and C N Bova (Defendant)
JUDGMENT
1 During the course of the hearing yesterday, counsel for the Defendant sought to tender a document which contained excerpts from statements made by various lay witnesses of the Plaintiff. The document was prepared for convenience only, that is to say, in order to avoid the tender of the individual statements with reference to a particular paragraph or paragraphs therein. The basis of the tender was said to be that the extracts contained admissions made by those witnesses.
2 Counsel for the Plaintiff objected to the tender on the grounds that the extracts from the lay witnesses’ statements were in each case part of the contents of a confidential document: s 119 of the Evidence Act 1995. Further, although the statements had been served on the Defendant, there had been no loss of client legal privilege because the contents had been disclosed by the Plaintiff to the Defendant under compulsion of law: s 122 (2)(c) of the Evidence Act. This was said to apply because the statements had all been served by the Plaintiff on the Defendant in accordance with the pre-trial directions made by the Court. In this respect, in my opinion, there is no difference between affidavits and statements: Baulderstone Hornibrook Engineering Pty Limited v Gordian Runoff Limited (2006) NSWSC 223.
3 The document which was tendered was marked MFI 1 and it has not been read by the Court at this stage, pending the Court’s determination on the objection taken by counsel for the Plaintiff.
4 This case was fixed for hearing by the Judicial Registrar on 8 December 2006. On that occasion, the Usual Order for Hearing in the Commercial List of this Court was made. Relevantly, that provides:
“2. Other than in the case of experts’ reports, where directions have been given for the service of affidavits or statements of evidence:
(g) nothing in this order shall otherwise deprive any party of any proper objection to the admissibility of evidence.”(a) a party who fails to comply with an order made for the service of affidavits or statements of evidence may not adduce evidence to which the order applies without the leave of the Court;
…
(d) if the affidavit is not read or the maker of a statement of evidence is not called as a witness, no other party may put the affidavit or statement in evidence without the leave of the Court;
…
5 The statements which were the source of the contents of MFI 1 were all served in accordance with the directions of the Court made before the case was fixed for hearing.
6 In support of their submission that MFI 1 was admissible, counsel for the defendant relied on Austress Freyssinet Pty Ltd v Marlin Internation Pty Ltd (2002) NSW SC 958; BC 200206111, in which Barrett J dealt with the tender by counsel for the plaintiff of certain parts of the defendant’s affidavits which had not been read by counsel for the defendant. The material tendered apparently contained admissions made by the defendant. Counsel for the plaintiff objected to the tender on the ground that the material in his client’s affidavits was protected by client legal privilege.
7 Barrett J noted that the purpose of compliance with a Court order to serve statements or affidavits was to notify the other party of the evidence the serving party intended to adduce at the trial. Barrett J thought that this meant the service of a statement or affidavit could not:
“carry with it any form of restriction upon the use the recipient may make of the material, save that it must be for the proper purposes of the particular proceedings.” (BC 200206111 at para 8).
Barrett J then referred to Barristers’ Board of Western Australia v Tranter Corp Pty Ltd (1976) WAR 65, in which it was held that a party was entitled to read in Court an affidavit filed on behalf of another party (Re Margetson v Jones (1897) 2 Ch 314), Leaders Shoes (Aust) Pty Ltd v National Insurance Co of New Zealand (1968) 1 NSWR 344 and In the Marriage of Crowe (1988) FLC 91-983, in each of which it was held that where one party had filed an affidavit, the other party could rely on it.
8 On the basis of those authorities, Barrett J was of the opinion that client legal privilege did not continue to subsist in a filed affidavit in such a way as to preclude the use of it by the other party in circumstances where the issue concerned the making of an admission by the party who had filed the affidavit.
9 In the matter for determination in this Court, in seeking to maintain the claim for privilege, counsel for the plaintiff referred the Court to Akins v Abbey Group Ltd (1998) 43 NSWLR 539, Sevic v Roarty (1998) 44 NSWLR 287 and Dubbo City Council v Barrett (2003) NSW CA 267; BC 200305990.
10 I do not think the Dubbo City Council case assists the Court. At para 22 of BC 200305990, Young CJ in Eq appears to cite the decision in Austress with approval, but his Honour also said that in Akins the Court of Appeal decided that experts reports served in accordance with the Court’s directions were disclosed under compulsion of law so that any privilege which attached to them was not lost because of s 122 (2) (c) of the Evidence Act.
11 With regard to Akins case, counsel for the defendant sought to limit its operation because in Akins the Court was dealing with statements which had been served in related, but separate, proceedings and a grant of access to those statements would have offended what Mason P referred to as the “Harman obligation Precluding Collateral Use of Statements” (see Akin at p 548.E): Home Office v Harman (1983) 1 AC 280.
12 I do not accept the defendant’s counsel’s submission that Akins should be read down because of its facts or what was said in Liberty Funding Pty Limited v Phoenix Capital Limited (2005) 218 ALR 283. The facts in Liberty Funding were far removed from what I am dealing with. Secondly, the Full Court in that case cast doubts on the Court of Appeal’s decisions in Akin and Sevic.
13 This Court is bound to follow the Court of Appeal in both Akin and Sevic. In that regard, Barrett J in Austress Freyssinet sought to categorise Akin as dealing only with the question of whether client legal privilege applied in circumstances where the materials were sourced from other proceedings. However, with all respect to Barrett J, I do not think that Akin is so limited in its operation. In Akin’s case Mason P referred to State Bank of South Australia v Smoothdale (No. 2) Ltd (1995) 64 SASR 224 as well as the Commercial Division Practice Note then current. Mason P concluded, relying on Smoothdale, that a direction made by the Court that the parties serve witness statements was more than a procedural direction; it was an Order of the Court, the flagrant breach of which might ultimately lead to punishment for contempt. As a consequence, waiver or loss of privilege attaching to a witness statement did not occur until the statement was tendered or the witness was called to give evidence.
14 In the present case, the effect of the directions made in this Court are not different from the effect of the orders referred to in Akin, as is made clear by Paragraph 2(a) of the Usual Order for Hearing. Moreover, Paragraphs 2(d) and (g) of the Usual Order for Hearing are intended to reinforce the legislative protection enshrined in s 122 (2) (c) of the Evidence Act. Thus the Usual Order for Hearing ensures that there will be no trial by ambush in the Commercial List whilst at the same time preserving, for the avoidance of doubt, client legal privilege in witness statements and affidavits until such time as they are tendered by the party who served them in the first place.
15 It follows, therefore, that there has been no loss of privilege or waiver of privilege in the material included in MFI 1 merely because the plaintiff served the statements of those witnesses.
16 The Court therefore rejects the tender of MFI 1.
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