Towercom Pty Ltd v Fahour - [2011] VSC 455

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMERCIAL AND EQUITY DIVISION

PRACTICE COURT

S CI 2011 2146

TOWERCOM PTY LTD (ACN 074 312 922)	Plaintiff
V
MOUSTAFA FAHOUR	Defendant

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JUDGE:	MACAULAY J
WHERE HELD:	Melbourne
DATE OF HEARING:	8 September 2011
DATE OF JUDGMENT:	9 September 2011
CASE MAY BE CITED AS:	Towercom Pty Ltd v Fahour
MEDIUM NEUTRAL CITATION:	[2011] VSC 455

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PRACTICE AND PROCEDURE – Waiver of client legal privilege – Whether client legal privilege is waived by the disclosure in pleadings of the substance of the evidence or of a document – Mann v Carnell (1999) 201 CLR 1 - Civil Procedure Act 2010 (Vic) s 26 - Evidence Act 2008 (Vic) s 122.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr J. L. Evans	Pryles & Co.
For the Defendant	Ms G. L. Schoff SC Ms J.E. Treleaven	Russell Kennedy

HIS HONOUR:

In its claim against Moustafa Fahour for wrongly causing it to sell land below market value, Towercom Pty Ltd pleads, as an integer in its particulars of loss, that the market value of the land was between $1.525 million and $1.85 million. Towercom claims that its loss is the difference between market value and the sale price of $1 million.

Fahour says that a (written) valuer’s opinion, which presumably supplied the foundation for that allegation, must be disclosed under s 26(1) of the Civil Procedure Act 2010 (Vic) because it is a document which is critical to the resolution of the dispute. Section 26 provides:

“(1)Subject to subsection (3), a person to whom the overarching obligations apply must disclose to each party the existence of all documents that are, or have been, in that person’s possession, custody or control-
…
(a)of which the person is aware; and
(b)which the person considers, or ought reasonably consider, are critical to the resolution of the dispute.
…

(3)Subsection (1) does not apply to any document which is protected from disclosure-
(a)on the grounds of privilege which has not been expressly or impliedly waived; or
(b)under any Act (including any Commonwealth Act) or other law.”

For the purpose of the application before the Court, Towercom has admitted a valuer’s opinion exists and does not dispute that it may be critical to the resolution of the dispute. But, it says that opinion is privileged and that privilege has not been waived. Thus, because of s 26(3)(a) of the Civil Procedure Act, it says s 26(1) does not apply to the valuer’s opinion.

To that Fahour says privilege has been waived by the disclosure of the substance of the evidence in Towercom’s pleading.

On Fahour’s application, an associate judge ordered that Towercom disclose the valuer’s opinion (and another document to which I refer later). Towercom appealed. The question I have to decide is whether Towercom has breached s 26(1) of the Civil Procedure Act by refusing to disclose the valuer’s opinion. The real issue is whether any privilege attaching to the document has been…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Towercom Pty Ltd v Fahour

Details

AGLC: Towercom Pty Ltd v Fahour [2011] VSC 455
Case: [2011] VSC 455
Decision Date: 9 September 2011

CaseChat Overview and Summary

Towercom Pty Ltd filed an action against Fahour in the Supreme Court of Victoria, seeking compensation for breaches of contract. The case involved a complex web of legal disputes, including allegations of fraud and misrepresentation. The defendants argued that certain documents were protected by client legal privilege and sought to prevent their disclosure. The primary issue before the court was whether the disclosure of the substance of the privileged documents in the pleadings constituted a waiver of the privilege. The case hinged on the interpretation of statutory provisions, particularly sections 26 of the Civil Procedure Act 2010 (Vic) and 122 of the Evidence Act 2008 (Vic), as well as the common law principles articulated in Mann v Carnell (1999) 201 CLR 1.

The court meticulously examined the statutory framework and the common law precedents to determine whether the disclosure in the pleadings amounted to a waiver of privilege. The court found that the disclosure in the pleadings did not constitute a waiver of the privilege because the statutory provisions and the common law principles did not impose such a requirement. The court held that the privilege was not lost simply by the disclosure of the substance of the privileged documents in the pleadings. The court also considered the practical implications of such a disclosure, noting that it was necessary for the defendants to provide sufficient information to allow the plaintiff to respond appropriately to the claims.

Following this analysis, the court concluded that the orders made by the Associate Justice Randall were erroneous. The appeal was allowed, and the orders were set aside. The court ordered the plaintiff to make the required disclosure in accordance with the Civil Procedure Act 2010 (Vic). Additionally, the court ordered the defendant to pay the plaintiff’s costs associated with the summons and the appeal, and granted the defendant an indemnity certificate under the Appeal Costs Act 1998 (Vic). This decision clarified the scope of the privilege and the requirements for disclosure in legal proceedings in Victoria.

Orders

Orders of the court

(1) The appeal is allowed and the orders of the Honourable Associate Justice Randall made 19 August 2011 are set aside.

(2) The plaintiff make disclosure in accordance with s 26(1) of the Civil Procedure Act 2010 (Vic) by 4pm 16 September 2011.

(3) The defendant pay the plaintiff’s costs of and incidental to the defendant’s summons filed 15 August 2011, and of the appeal commenced by notice of appeal filed 24 August 2011.

(4) Under s 4 of the Appeal Costs Act 1998 (Vic), the defendant be granted an indemnity certificate in respect of the costs of the appeal.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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