The Shed People Pty Ltd v Turner & Others No. Scgrg-99-89

The matter before the South Australian Supreme Court was an appeal against a decision by a Master that documents in the possession of Scales & Partners, a firm of solicitors, were to be produced for inspection by the liquidator of The Shed People Pty Ltd. The liquidator sought to inspect documents that were claimed to be privileged by Scales & Partners. The liquidator alleged that the company had provided financial assistance to one of its directors, Colin Jones, in breach of the Corporations Law. The liquidator sought to inspect documents that were created in the period when Colin Jones was acting on behalf of both himself and the company.

The legal issues before the court concerned the application of legal professional privilege in relation to the documents in question. The court had to decide whether the documents were subject to joint privilege, which would mean that they could be inspected by the liquidator, or whether the privilege applied only to one party, in which case the liquidator would not be entitled to inspect them. The court also had to consider the nature of the relationship between Scales & Partners and the parties to the transaction, and whether the firm had acted for the company or for Colin Jones personally.

The court found that Scales & Partners had acted for both Colin Jones and the company, and that the documents were therefore subject to joint privilege. The court noted that the company had paid for the legal services provided by Scales & Partners, and that the documents related to matters that involved both Colin Jones and the company. The court held that the liquidator, as the agent of the company, was entitled to inspect the documents.

The appeal by Scales & Partners was dismissed, and the order of the Master was upheld. The court also ordered that Scales & Partners pay the costs of the appeal. The court's decision reinforces the principle that where a solicitor acts for two parties with a joint interest in a transaction, the communications between the parties and the solicitor are subject to joint privilege, and can be inspected by the liquidator of one of the parties.