Sino Iron Pty Ltd v Mineralogy Pty Ltd
[2021] WASC 442
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS
CITATION: SINO IRON PTY LTD -v- MINERALOGY PTY LTD [2021] WASC 442
CORAM: REGISTRAR GRIFFIN
HEARD: 12 NOVEMBER 2021
DELIVERED : 22 NOVEMBER 2021
PUBLISHED : 9 DECEMBER 2021
FILE NO/S: CIV 1915 of 2019
BETWEEN: SINO IRON PTY LTD
First Plaintiff
KOREAN STEEL PTY LTD
Second Plaintiff
CITIC LIMITED
Third Plaintiff
AND
MINERALOGY PTY LTD
First Defendant
CLIVE FREDERICK PALMER
Second Defendant
STATE OF WESTERN AUSTRALIA
Third Defendant
Catchwords:
Legal professional privilege - Purpose test - Giving or receiving legal advice - Disclosure to third parties - Discharged onus - Communication with in-house counsel - Legal advice to non lawyers
Legislation:
Legal Profession Conduct Rules 2010 (WA), r 24
Result:
Application not granted
Category: B
Representation:
Counsel:
| First Plaintiff | : | SK Dharmananda SC |
| Second Plaintiff | : | SK Dharmananda SC |
| Third Plaintiff | : | SK Dharmananda SC |
| First Defendant | : | P Dunning QC |
| Second Defendant | : | P Dunning QC |
| Third Defendant | : | P Dunning QC |
Solicitors:
| First Plaintiff | : | Herbert Smith Freehills |
| Second Plaintiff | : | Herbert Smith Freehills |
| Third Plaintiff | : | Herbert Smith Freehills |
| First Defendant | : | Kane Jones |
| Second Defendant | : | Alexander Law |
| Third Defendant | : | State Solicitor's Office |
Case(s) referred to in decision(s):
Archer Capital 4a Pty Ltd (as trutee for the Archer Capital Trust 4A v Sage Group PLC (No 2) [2013] FCA 1098
Bank of Nova Scotia v Hellenic Mutual War Risks Association (Bermuda) Ltd [1992] 2 Lloyd’s Rep 540
Crawford v Quail [2012] WASC 290
Global Funds Management (NSW) Ltd v Rooney (1994) 36 NSWLR 122
Spotless Group Ltd v Premier Building and Consulting Group Pty Ltd [2006] VSCA 201
REGISTRAR GRIFFIN:
This is the first and second defendants (defendants) application made by chamber summons dated 5 October 2021 (the Application) seeking orders that:
(a)The plaintiffs' claim of legal professional privilege (LPP) with respect to certain documents [contained in a schedule to the chamber summons] to be declared unfounded or mistaken; and
(b)the plaintiffs provide complete and unredacted copies of the documents contained in the schedule.
Background
Pursuant to orders made by K Martin J on 14 October 2021, the parties have provided a Scott Schedule dated 11 November 2021 (the Scott Schedule) which contains the defendants' contentions with respect to a sample of the documents in the Application, the plaintiffs' response and the defendants' reply. It would not be practicable to consider the claim for LPP for each individual document in the Application.
The documents are in seven categories:
A – Emails to external parties
B – Correspondence to or from Catherine Pinchin
C – Meeting minutes
D – Communication between non-lawyers
E – Memorandums and reports
F – Metadata only documents
G – Inadvertently disclosed documents not otherwise proposed by the defendants as sample documents
The documents in the Scott Schedule are referred to by a number in these reasons and in Annexure A to these reasons. That number is the number of the row in which the document appears in the Application.
The plaintiffs have provided to the court unredacted copies of the sample set of documents in the Scott Schedule.
Short form reasons
The Application proceeded on the basis that short form reasons would be provided.
Evidence and submissions
The parties relied upon positions expressed in the Scott Schedule.
The defendants relied upon:
(a)Submissions dated 6 August 2021 and 6 October 2021; and
(b)affidavits of Daniel Jacobson affirmed 5 October 2021 (Jacobson Affidavit 1), 14 October 2021 (Jacobson Affidavit 2), 11 November 2021 (Jacobson Affidavit 3) and Thomas Vincent Browning sworn 9 August 2021 (Browning Affidavit).
The plaintiffs relied upon:
(a)Submissions dated 4 October 2021 and 3 November 2021; and
(b)affidavits of William Robert Spain affirmed 3 November 2021 (Spain Affidavit), Michelle Elise Dunn sworn 3 November 2021 (Dunn Affidavit 1), and 11 November 2021 (Dunn Affidavit 2), confidential affidavit of Eve Margaret Lynch affirmed 3 November 2021 (Confidential Lynch Affidavit), an open affidavit of Eve Margaret Lynch affirmed 3 November 2021 (Open Lynch Affidavit), confidential affidavit of David William John sworn 3 November 2021 (Confidential John Affidavit), confidential annexure to Confidential John Affidavit (Confidential John Annexure), and an open affidavit of David William John sworn 3 November 2021 (Open John Affidavit).
Principles
Whilst there was no dispute between the parties as to the relevant principles governing claims of LPP, there was debate about the application of those principles to the documents, particularly concerning communications with in-house counsel, and the distribution of communications said to contain legal advice to non‑lawyers. The operation of the parties' agreed LPP Clawback provisions in the parties' Protocol for the Electronic Exchange of Discovered Documents dated 30 March 2021, was also the subject of argument.
LPP will attach to a communication between lawyer and client if:
(a)it is confidential and for the dominant purpose of giving or receiving legal advice (Advice Privilege); or
(b)it is confidential, made after litigation is commenced or contemplated, between a lawyer and their client or third parties for the dominant purpose of litigation (Litigation Privilege).[1]
[1] Crawford v Quail [2012] WASC 290 (Crawford v Quail) [29].
When considering a claim for LPP, the ruling, prevailing or most influential purpose should be considered.[2]
In house lawyers
[2] Defendant’s submissions, 6 October 2021 [11b].
Communications with in-house lawyers may attract LPP. The crucial issue is to determine whether the in-house lawyer was consulted in a professional context to provide legal advice. In that case, the communication is likely to satisfy the dominant purpose test. If the lawyer was consulted to provide commercial advice or perform an administrative service then the dominant purpose is unlikely to be satisfied.[3] Independence is not a crucial element to be satisfied; rather the capacity in which the lawyer was consulted.[4]
Disclosure to third parties - waiver
[3] Archer Capital 4a Pty Ltd (as trutee for the Archer Capital Trust 4A v Sage Group PLC (No 2) [2013] FCA 1098 [72].
[4] Ibid [73].
If a communication is provided to a third party for a specific and limited purpose [my emphasis] there is no inconsistency between doing that and insisting on non‑disclosure to others on the basis of LPP.[5]As to this point, the defendant submits that in that case regard should be had to the dissenting judgment of Neave J, who was not willing to conclude, as did the majority, that legal advice was being sought. Her Honour held 'there was no evidence that the documents were provided to [engaged business strategist] on a confidential basis for a limited and specific purpose.[6] On that basis, the dissenting judgment is said to indicate the documents do not meet the dominant purposes test.[7]
[5] Spotless Group Ltd v Premier Building and Consulting Group Pty Ltd [2006] VSCA 201 [26] and [30] (Chernov JA).
[6] Ibid [87].
[7] Defendant’s submissions, 06 October 2021 [11c].
Legal advice may be provided to a third party for the purposes of achieving the object for which the legal advice is sought.[8] LPP may exist if the client bona fide believes that they are communicating with their solicitor, the privilege subsisting until the time 'when their belief is exploded'.[9]
[8] Bank of Nova Scotia v Hellenic Mutual War Risks Association (Bermuda) Ltd [1992] 2 Lloyd’s Rep 540, 540-541 Saville J.
[9] Global Funds Management (NSW) Ltd v Rooney (1994) 36 NSWLR 122, 130 (Young J).
Defendants' counsel submitted that it is not enough to invoke a broad based confidentiality agreement in order to maintain LPP over a communication once it has been disclosed to a third party – otherwise the scope of LPP would be unacceptably expanded (paraphrasing defendants' counsel's submissions in this regard).[10]
Privilege Clawback
[10] Transcript 12/11/2021, T761.
The plaintiffs submit that the Privilege Clawback protocol, and Rule 24 of the Legal Profession Conduct Rules (regarding a practitioner's duty to return documents reasonably suspected of being the subject of LPP when inadvertently disclosed) should both be enlivened by the assertion of the plaintiffs' legal representatives that the documents in categories F and G are subject to LPP. In this regard, plaintiffs' counsel drew my attention to paragraphs 12.3, 12.4 and 12.5 of the Privilege Clawback
The defendants have not inspected these documents[11], but dispute that the documents are subject to LPP. So, the defendants say that it is not an issue of whether or not the Privilege Clawback has been properly invoked, but whether or not the documents are LPP. If they are, the documents should be returned. If they are not, the protocol does not apply.
[11] Transcript 12/11/2021, T756.
Onus
Senior counsel for the defendants briefly addressed this in argument, in response to the plaintiffs' written submissions on this point.[12]
[12] Plaintiff’s submissions, 03 November 2021 [8] – [10]; Transcript 12/11/2021, p 726.
In short, the plaintiffs submit that the defendants have not discharged their onus as required by O 26 r 1 RSC (and see also Crawford v Quail at [25], [26] and [28]). It is said that the defendants' evidence as to the mischaracterisation of documents as subject to LPP is thin.
In response, it was submitted that the defendants have discharged their onus; but secondly and probably more importantly, that the issue of onus was not as significant in a situation such as the present, in which the parties have adopted the Scott Schedule format and unredacted copies of the documents have been provided to the Court.
I accept this submission. There was no oral argument from the plaintiffs on this point, and written submissions were confined to three short paragraphs. I do not propose to consider the question of whether the defendant has discharged its evidentiary onus.
Disposition
I have set out my conclusions with respect to each of the documents in Annexure A to these reasons.
In house lawyers
In reaching my conclusions, I have considered the position of those persons said to be in‑house lawyers for the plaintiff and whose roles and employment contracts were addressed in argument, being Catherine Pinchin, Ricky Choy, Justin Cvitan and Hsin Luen Tan.
Catherine Pinchin
Ms Pinchin was engaged to work for the plaintiffs via an intermediary company (not a law firm) called Keybase Pty Ltd (Keybase). Keybase performed certain services for the plaintiff via its 'Principal Employee', Ms Pinchin. The engagement was pursuant to a signed Consultancy Agreement for 'Commercial Development Advisor Consultancy Services' dated 12 April 2007 (2007 Agreement). The 2007 Agreement does not specifically mention the provision of legal services, but it is contended by the plaintiffs that is encapsulated within clause 4 of the 2007 Agreement which provides that Keybase 'will provide such other services within [its] field of expertise'.[13] Legal advice was said to be a service within Ms Pinchin's area of expertise.
[13] Dunn affidavit [22].
There is a further, unsigned Consultancy Agreement between the plaintiff and Keybase, for 'Legal Consultancy Services' dated 2008. (2008 Agreement). The 2008 Agreement provides for [Keybase] to 'render to the Company general legal advice' and is otherwise in the same terms as the 2007 Agreement. The defendants say that the agreement's not being signed was a significant factor telling against it having any effect. The plaintiffs say that, given the passage of time and the fact, of which I will take judicial notice, that not every document in a large organisation is signed as it should be, that little weight should be given to that issue. It was the plaintiffs' 'standard practice to obtain signed copies of such agreements'.[14] Given the passage of time, no signed copy of 2008 Agreement could be found.[15] Ms Pinchin's services for CPM came to an end on around 30 May 2009.[16]
[14] Dunn affidavit [23].
[15] Dunn affidavit [23].
[16] Dunn affidavit [25].
As at November 2008, Ms Pinchin's email signature was:
Catherin Pinchin
Manager Legal
LegalCITIC Pacific Mining
After 2009, Ms Pinchin provided general consulting services to CPM via 'Preston Consulting'. No terms of engagement between CPM and Preston Consulting could be located, and the plaintiffs rely upon CITIC's standard terms of engagement in this regard.[17] There has not been an ongoing professional relationship between Ms Pinchin and CPM since around 2013.[18]
[17] Dunn affidavit [26].
[18] Dunn affidavit [27].
CPM paid for Ms Pinchin's practising certificate during her engagement with CPM.[19]
[19] Dunn affidavit [24].
It was open to the plaintiffs to engage Ms Pinchin directly as an in-house lawyer, as was the case for other persons in this category. The plaintiffs did not do so. I consider that on occasion Ms Pinchin was providing legal advice and was seen by others to be acting in that capacity.[20] On other occasions she was not. I have reviewed the documents in that light.
Ricky Choy
[20] Spain affidavit [8] - [9].
Mr Choy was engaged as general counsel.[21] His letter of engagement 30 January 2011 was handed up during the hearing.[22]
[21] Dunn affidavit [32].
[22] Transcript 12/11/2021, p 752.
I conclude that Mr Choy was engaged as in‑house counsel and acted in that capacity.
Justin Cvitan
Mr Cvitan, whilst engaged as a 'Heritage Advisor' was also a certificated legal practitioner. CPM paid the cost of Mr Cvitan's practising certificate.[23] A 'Heritage Advisor' would appear on the face of it to be an operational role, as submitted by the defendants.[24] There is no evidence that Mr Cvitan was engaged as a lawyer to provide legal advice. That does not mean that every communication in which he is included is not privileged. Conversely, the mere fact of his having legal qualifications does not render every communication in which he is involved, subject to LPP.
Hsin Luen Tan
[23] Dunn affidavit [28] - [29].
[24] Transcript 12/11/2021, p 734.
Ms Tan's offer of employment from CITIC dated 14 July 2009 describes her position as 'senior legal counsel' on 14 July 2009[25] and she was identified by the defendants as a 'known lawyer' bearing the title of 'Citic Senior Legal Counsel'.[26]
[25] Jacobson affidavit dated 11 November 2021, 12.
[26] Browning affidavit [26].
I have concluded that Ms Tan was engaged as an in‑house lawyer.
General comments on in-house lawyers
I accept the proposition that not every communication with an in-house lawyer will be subject to LPP. I have reviewed the documents bearing this principle in mind.
Cross referencing of rows
Senior counsel for the defendant submitted that if I were to find that Ms Pinchin was not engaged as legal counsel, then that would flow through to my findings on rows 8, 19, 26, 41, 25, 33, 55, 168, 177, 179, 181, 184, 258, 259, 22, 148 and 156. If Ms Pinchin was not engaged as legal counsel, then none of the documents identified in those rows are subject to LPP.
Senior counsel for the plaintiff submitted that my findings on rows 108, 103, and 102 would flow through to my findings on rows 67, 71, 73, 75, 79, 81, 85, 100 and 103 – if 108, 103 and 102 are subject to LPP then so are the others mentioned.
I have borne these submissions in mind when making my findings on the documents. However, given the observations in paragraph 13, which can be paraphrased that whether or not LPP attaches to communications with in-house lawyers depends upon the capacity in which they were consulted, I have found that the 'flow through' effects for which counsel contended did not necessarily operate as submitted.
Privilege Clawback
The plaintiffs have deposed that documents in Categories F and G were inadvertently disclosed and have previously sought to invoke the Privilege Clawback regime by letters to the defendants dated 13 April 2021 and 26 July 2021.[27]
[27] John affidavit 3 November 2021 [35] - [38].
All the documents in categories F and G were included in the letters referred to in paragraph 40, with the exception of rows 63, 109 and 110.
I have found that the documents in categories F and G were subject to LPP and were inadvertently disclosed.[28]
[28] John affidavit 3 November 2021 [39] - [55].
On that basis the Privilege Clawback regime should be applied to these documents.
Orders and costs
The defendants' application has been largely unsuccessful.
On that basis the appropriate costs order is for the defendants to pay the plaintiffs' costs of the Application to be taxed if not agreed.
No other consequential orders are required as order 4 of the orders of K Martin J dated 14 October 2021 deals with next steps:
Within 7 days of Registrar Griffin delivering short form reasons, as to whether or not the claims for LPP with respect to the considered documents are upheld or otherwise, the Plaintiffs shall deliver up to the first and second defendants unredacted copies of those documents (if any) over which the claim for LPP is not upheld, and unredacted copies of any documents listed in the first and second defendants' outline of written submissions, for its amended LPP summons dated 7 October 2021, that are consequentially affected by the findings of Registrar Griffin.
ANNEXURE A
| Document | Finding |
| Category A | |
| 8 | LPP |
| 19 | Not LPP |
| 26 | LPP |
| 41 | LPP |
| 164 | LPP |
| 207 | LPP |
| 226 | LPP claim not pressed |
| 243 | Not LPP |
| 246 | LPP claim not pressed |
| 251 | LPP |
| Category B | |
| 25 | Not LPP |
| 33 | Not LPP |
| 55 | LPP |
| 168 | LPP |
| 177 | LPP |
| 179 | LPP |
| 181 | LPP |
| 184 | Not LPP |
| 258 | LPP |
| 259 | LPP |
| Category C | |
| 133 | LPP |
| 135 | LPP |
| 185 | LPP |
| 186 | LPP |
| 187 | LPP |
| 229 | LPP |
| 238 | LPP |
| 277 | LPP |
| Category D | |
| 9 | LPP claim not pressed |
| 11 | LPP challenge not pressed |
| 22 | LPP |
| 31 | Not LPP |
| 43 | LPP |
| 53 | LPP |
| 58 | LPP claim not pressed |
| 60 | LPP |
| 188 | LPP |
| 208 | LPP claim not pressed |
| 211 | Not LPP |
| 227 | LPP claim not pressed |
| 279 | LPP |
| 280 | LPP |
| Category E | |
| 12 | LPP challenge not pressed |
| 130 | LPP |
| 131 | LPP |
| 140 | LPP challenge not pressed |
| 144 | LPP |
| 148 | LPP |
| 151 | LPP claim not pressed |
| 152 | LPP |
| 153 | LPP |
| 154 | LPP |
| 156 | LPP |
| 194 | LPP |
| Category F | |
| 64 | LPP |
| 67 | LPP |
| 71 | LPP |
| 73 | LPP |
| 75 | LPP |
| 79 | LPP |
| 81 | LPP |
| 85 | LPP |
| 100 | LPP |
| 103 | LPP |
| 108 | LPP |
| 113 | LPP |
| Category G | |
| 61 & 62 | LPP |
| 63 | LPP |
| 102 | LPP |
| 109 & 110 | LPP |
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
LR
Associate to Registrar Griffin
10 DECEMBER 2021
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