Rollinson and Chase

[2017] FCCA 3119

FEDERAL CIRCUIT COURT OF AUSTRALIA

ROLLINSON & CHASE [2017] FCCA 3119

Catchwords:
FAMILY LAW – Application by husband that wife’s solicitors cease to act for her due to asserted confidential information having been previously provided by husband to wife’s solicitors – application dismissed.

Legislation:

Evidence Act 1995, s.131(2)(g)

Cases cited:

Osferatu & Osferatu [2015] FamCAFC 177

Dalton & Dalton (2017) FLC 93-773
Wilmer & Golding (No 2) [2017] FamCAFC 113

Applicant: MS ROLLINSON

Respondent: MR CHASE

File Number: PAC 1381 of 2017

Judgment of: Judge Newbrun

Hearing date: 9 May 2017

Date of Last Submission: 29 November 2017

Delivered at: Parramatta

Delivered on: 14 December 2017

REPRESENTATION

Solicitors for the Applicant: Michael Vassili Barristers & Solicitors

Solicitors for the Respondent: Marsdens Law Group

ORDERS

1. The husband’s application to restrain the wife’s solicitors from continuing to act for her is dismissed.

IT IS NOTED that publication of this judgment under the pseudonym Rollinson & Chase is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT PARRAMATTA

PAC 1381 of 2017

MS ROLLINSON

Applicant

And

MR CHASE

Respondent

REASONS FOR JUDGMENT

Introduction

1. The husband seeks to restrain the wife’s solicitors from continuing to act for her in these property proceedings contending that relevant confidential information was provided by the husband to the wife’s present solicitors on 3 January 2017, at which time he attended the wife’s solicitor’s offices for a free conference/interview. Following this consultation the husband ascertained on 8 March 2017 that the wife’s solicitors were now acting for the wife.

2. Each party has filed and served a case outline; the documents that they rely upon are set out in the Case Outlines. The Applicant wife relies on:

   a)Affidavit of Mr P filed 9 June 2017; and

   b)Affidavit of Mr Chase filed 3 May 2017 (paragraphs 1-9 and 27-65). 

3. The Respondent husband relies on:

   a)Response of Mr Chase filed 3 May 2017;

   b)Affidavits of Mr Chase filed 3 May 2017 and 9 June 2017.

4. The Court notes that the parties proposed that this matter be dealt with on the papers without cross-examination.

5. The parties separated in September 2016, and remained separated under the one roof until 6 March 2017.

6. On 3 January 2017, the husband attended upon the wife’s solicitors seeking advice in relation to property settlement with the wife; he had earlier that day spoken to the wife’s solicitors on the telephone providing some brief information and had made the appointment. On the same date, the husband met with the wife’s solicitors providing more information. It is the provision of this information on 3 January 2017 that has led to the husband’s application.

7. The husband asserts that he provided to the wife’s solicitors on 3 January 2017 instructions and confidential information about his financial situation and separation.

8. The wife’s solicitors prepared a File Note (attached to the wife’s solicitors practice manager’s Affidavit) dated 3 January 2017. The wife’s solicitors’ practice manager states that the file note relates to the meeting the husband attended with the wife’s solicitor’s office.

9. The husband asserts that the file note contents contain detailed and confidential information which he has provided to the wife’s solicitors. The husband asserts that the file note does not contain all the information he recalls providing, however he does not refer to the nature or extent of such information in his Affidavit.

10. In the husband’s Affidavit filed 9 June 2017 he sets out his concerns in relation to the wife’s solicitors continuing to act for the wife in the circumstances. He maintains that he is currently in a significant disadvantage as the wife’s solicitors are in possession of what he asserts is his confidential information “and strategy” and that they “know what and how I think about the matter.”

11. Following 3 January 2017, the husband conducted certain negotiations with the wife relating to property settlement, until the wife left the family home.

12. On about 8 March 2017 the husband was told by the wife’s solicitors by letter that they were acting for the wife.

13. The Court refers to the file note attached to the affidavit of Mr P filed 9 June 2017.

14. It appears from the file note that the wife’s solicitors took some basic information from the husband relating to the parties’ assets and liabilities, contributions and future needs. Then some specific questions were asked by the husband relating to, for example, whether he needed to sell certain property, whether he had to pay the wife straightaway once they reached an agreement, what the husband might do if the wife did not talk to the husband or the parties could not reach agreement, would an agreement with the wife reached in (country omitted) be accepted in Australia, what the husband needed to do about transferring a property into his name, and other basic information was afforded the husband by the wife’s solicitors in relation to property settlement.

15. The practice manager refers to a detailed letter sent from the husband’s first solicitors dated 21 March 2017 to the wife’s solicitors relating to “family law property proceedings” between the parties. In that letter, it is asserted initially

    We refer to our letter dated 14 March 2017, and as advised in the said letter, we act for (the husband). Our client provided us with your letter dated 8 March 2017, which advise that your office acts for (the wife).

16. It is next stated by the husband’s first solicitors in that letter of 21 March 2017 that the husband had provided the wife’s solicitors on 3 January 2017 “with detailed instructions with respect to his assets, liabilities, matrimonial background and other information.” The letter asserts that in the wife’s solicitor’s letter to the husband (of 8 March 2017) they failed to disclose

    that you had provided our client with advice that there may be a prima facie conflict of interest. We note that our client reserves his right to object to you continuing to act on behalf of (the wife) in the same transaction.

17. The letter from the husband’s first solicitors then next states

    However, in the spirit of settling the issues between our respective clients without unnecessary delay and unnecessary legal costs we are instructed to respond to your client as set out hereunder.

    The letter then proceeds to set out various detailed asserted facts on behalf of the husband under the headings “Background”, “asset pool”, “wife’s assets in (country omitted)”, “short marriage”,” contributions”, “Kennon argument”, “loan to parents”, and finally proceeds to make an offer of settlement on a without prejudice basis to the wife, it having been stated that the husband rejects the wife’s offer of settlement. It is finally stated that the offer is open for seven days after which the husband will consider his other options.

18. The wife’s solicitor’s practice manager’s Affidavit states, inter alia, that after the first free interview with the husband on 3 January 2017, the husband was not sent a costs and retainer agreement and initial letter from the wife’s solicitors as he was of the opinion after this first initial interview with the husband that the husband was not ready to engage the wife’s solicitors.

19. The practice manager states that it is only after a $1,000 retainer fee is received into the wife’s solicitors trust account that the wife’s solicitors regard themselves as engaged in the matter and commence to receive instructions from the client.

20. The practice manager states he is aware that the husband is asserting that he provided alleged confidential information to the wife’s solicitors on 3 January 2017.

21. The practice manager states that since this time, he has ensured that the solicitors that have spoken with the husband previously are physically separated to the other solicitors who will be working on the matter should the Court find there to be a conflict of interest and a Chinese wall arrangement can be imposed. He states that he has ensured that the solicitors who are to work on the matter do not have access to the file note of the meeting with the husband on 3 January 2017.

22. The practice manager asserts that the contents of the wife’s solicitor’s file note does not provide any information higher than what is contained in the letter received from the husband’s first solicitors of 21 March 2017. There is force to this assertion in the view of the Court, and moreover, it tends to understate the significantly additional information in that latter letter.

23. This Court on the first the return date of the wife’s Initiating Application filed 28 March 2017, namely on 9 May 2017, made orders by consent, inter alia,

    1. The wife’s solicitor shall cause copies of all notes held by him or his law firm, in relation to past meetings with the respondent husband, to be produced to the husband’s solicitors by 5PM today.

Legal principles

1. The Court refers to the comprehensive discussion of legal principle set out in Osferatu & Osferatu (2015) FLC 93-666, and Dalton & Dalton (2017) FLC 93-773 (majority decision), as confirmed recently in Wilmer & Golding (No 2) [2017] FamCAFC 113.

Discussion and determination

1. The husband objects to the reception of the file note into evidence at this hearing.

2. At the outset, the Court is of the view that the file note contents, on the evidence before the Court, probably constitutes the entirety of the family law property information held by the wife’s solicitors and provided to them by the husband on 3 January 2017; the husband’s bare assertion, without particularity, that “the file note does not contain all the information I recall providing” is of no moment – it does not suggest that such asserted additional information was relevant confidential information – and, in any event, the Court refers to paragraphs 17-19 of the affidavit of Mr P referring to, inter alia,

   17. Our files are located in a commercial room safe at our (omitted) office. I have ensured that the solicitors who are to work on this matter do not have access to the file note of the meeting with Mr Chase.

   18. Annexed and marked with the letter “A” is a copy of the file note of the meeting Ms Rollinson attended to with our office.

   19. Annexed and marked with letter “B” is a copy of the letter received from Ms Rollinson’s former solicitors MN Lawyers and Associated dated 21 March 2017. It appears having read the file note and this letter that the information provided by Ms Rollinson to our office as contained in the file note does not take the information any higher than what is contained in the letter from Ms Rollinson’s former solicitors.  

3. In the view of the Court the file note is admissible.

4. The file note was admissible in proof of the wife’s contention that the information provided by the husband to the wife’s solicitors on 3 January 2017 was so general and brief in its nature as not to constitute confidential information, and the Court so concludes, in particular by reference to the contents of the file note itself, and also by reference to the contents of the husband’s solicitor’s letter of 21 March 2017.

5. In any event, the file note was admissible in proof of the wife’s contention that the contents of the husband’s first solicitor’s letter of 21 March 2017, constitutes a waiver (at least an implied waiver) of any confidentiality or privilege arising out of the provision of information to the wife’s solicitors on 3 January 2017. (In this context, the Court should state that letter of 21 March 2017 is itself admissible in proof of the waiver issue; see, for example, s131(2)(g) of the Evidence Act – the husband’s statements as to confidentiality of the information provided by him on 3 January 2017 are likely to mislead the Court unless the contents of the letter of 21 March 2017 are admissible).

6. And the Court concludes that the husband did waive any confidentiality or privilege attaching to the information provided on 3 January 2017. In this context, the Court refers to the contents of the file note, the contents of the husband’s first solicitor’s letter of 21 March 2017, the contents of the wife’s Affidavit filed 28 March 2017 (as to those parts tendered), and the husband’s Affidavit filed 3 May 2017.

7. As to the above finding as to waiver, the letter of 21 March 2017 acknowledges the husband’s solicitor’s awareness of the husband having given “detailed instructions with respect to his assets liabilities matrimonial background and other information”, whilst then proceeding to provide copious factual information and argument in relation to the husband’s position on property adjustment, and then proceeds to make a without prejudice offer of settlement to the wife. The copious factual information provided by the husband in his then solicitor’s letter of 21 March 2017 can be seen to be a very detailed elaboration of the basic information of the husband referred to in the file note.

8. Further, in the view of the Court, comparing the mere contents of the file note with the detailed factual information contained in the letter from the husband’s first solicitors dated 21 March 2017; comparing the file note contents with the property adjustment factual information contained in the husband’s Affidavit filed 3 May 2017; and finally, comparing the file note contents with the property adjustment factual information in the wife’s Affidavit filed 28 March 2017 (as to those parts tendered), it cannot be reasonably asserted by the husband that the information provided to the wife’s solicitors on 3 January 2017 was or continues to be relevant confidential information.

9. It is not to the point, and of no legal consequence, that in that letter of 21 March 2017 the husband purported to reserve his right to object to the wife’s solicitors continuing to act on behalf of the wife “in the same transaction”, and further, it was of no legal consequence that the letter was expressed to be “without prejudice”. Such statements cannot prevent the wife from making the contentions that she does as to, for example, waiver (at least implied waiver).

10. Further, and in the alternative, even accepting, again, that the information provided to the wife’s solicitors on 3 January 2017, and contained within the file note, was confidential information, in view of the above comparisons of the contents of the file note with the husband’s Affidavit filed 3 May 2017 and the wife’s Affidavit (as to those parts tendered), it is unreasonable for the husband to now assert his belief and contend that such information might be used against him, or at least to his disadvantage, in these current property proceedings (see Lindenmayer J in Stewart & Stewart, as referred to in Osferatu’s case).

11. Even if the information provided by the husband to the wife’s solicitors on 3 January 2017 is properly to be regarded then and now as confidential information, and assuming the Court is incorrect as to waiver, the Court is of the view that the risk of disclosure or misuse of such information to those other solicitors within the wife’s solicitor’s firm is not a real one and is merely fanciful or theoretical.

12. The Court reaches this conclusion immediately above in light of the evidence of the practice manager of the wife’s solicitors, including the protective steps that he has taken to ensure that the said information, contained within the file note, is not passed to the present solicitors acting for the wife within the firm of the wife’s solicitors (in this context, the Court rejects the submissions of the husband criticizing the measures taken within the wife’s solicitor’s law firm); a comparison of the nature of the information in the file note with the detailed factual information contained in the letter from the husband’s first solicitors dated 21 March 2017; a comparison of the file note contents with the property adjustment factual information contained in the husband’s Affidavit filed 3 May 2017; and finally, a comparison of the file note contents with the property adjustment factual information in the wife’s Affidavit filed 28 March 2017 (as to those parts tendered). Even if the Court is incorrect as to the likely efficacy of the protective steps taken by Mr P, then the Court would still be satisfied, by reference to the above comparisons, that the risk of disclosure or misuse of such information to those other solicitors within the wife’s solicitor’s firm is not a real one and is merely fanciful or theoretical.

13. The husband’s application will be dismissed, and the costs of the wife in defending this application will be reserved.

I certify that the preceding thirty seven (37) paragraphs are a true copy of the reasons for judgment of Judge Newbrun

Date: 14 December 2017