Trade Practices Commission v Nashco Pty Ltd

JUDGMENT No. ....

........ .

3 2 9 ,

... ......

a y

.Ocl

324 L

IN THE FDERAL COURT OF AUSTRALIA

) )

gUEENSLAND DISTRICT REGISTRY

No. Qld G 53 of 1984

GENERAL DIVISION

)

BETNEEN:

TRADE PRACTICES

COMMISSION

Applicant

AND:

NASHCO

LIMITED

PTY

First Respondent

GARGEVA FTY LIMITED

Second Respondent

JOSEPH PATRICK

NASH

Third Respondent

NEVILLE FRANCIS McCOSH

Fourth Respondent

RONALD JOHN	JAMES DAVIS
Fifth Respondent

O R D E R

JUDGE MAKING ORDER : Neaves

DATE OF ORDER

10 October 1984

WHERE MADE

: Brisbane

THE COURT ORDERS THAT:

1. The application by the second and fourth

i	respondents be dismissed.

2. The second and fourth respondents pay the applicant's costs of the application.

IN THE FEDERAL COURT OF AUSTRALIA	1 1
QUEENSLAND DISTRICT REGISTRY	1 No. Qld G 53 of 1984
1

DIVISION

GENERAL

BETWEEN :

TRADE

PRACTICES

COMMISSION

Applicant

AND:

NASHCO PTY

LIMITED

First Respondent

GARGEVA PTY LIMITED

Second Respondent

JOSEPH PATRICK NASH

Third Respondent

NEVILLE FRANCIS McCOSH

Fourth Respondent

RONALD JOHN JAMES DAVIS

Fifth Respondent

CORAM: Neaves J.

U: 10 OCTOBER 1984

REASONS FOR JUDGMENT

Neaves J.

A proceeding is pending in this Court

a the suit

of the Trade Practices Commission

("the Commission") against

Nashco Pty. Limited

("the first respondent"), Gargeva Pty.

Limited ("the second respondent"), Joseph Patrick Nash

("the

third respondent"), Neville Francis McCosh

("the fourth

respondent") and Ronald John James Davis

("the fifth

respondent") for pecuniary penalties and injunctive relief

in respect of certain alleged contraventions of paragraph

45(2)(a) of the Trade Practices Act

1974 ("the

Act").

The statement of claim filed on behalf of the

Commission alleges that each of the first, second and fifth

respondents at all material times carried on business as a

petrol retailer at Bundaberg, Queensland, those businesses

being respectively carried on under the business names

"Shell Speedy Service Station",

"Amp01 Canelanders Service

Station" and "Bundaberg Star Service Station". It is

further alleged that on

r about 17 February 1983 the first

respondent by its servant or agent the third respondent, the

second respondent by its servant

or agent the fourth

respondent, and the fifth respondent made an arrangement

arrived at an understanding between themselves and other

petrol retailers at Bundaberg whereby the minimum retail

price of super-grade petrol supplied,

or to be supplied, at

Bundaberg by the parties

to the arrangement

or understanding

would be fixed

or maintained at a particular level.

The

material provisions of that arrangement

or understanding, so

it is alleged, had a purpose,

or had or were likely to have

an effect, falling within sub-section 45A(1) of the Act.

The third respondent, being

a director of the first

respondent, and the fourth respondent,

a director of the

second respondent, are alleged to have been directly

3 .

indirectly knowingly concerned in,

or a party to, the

conduct of the first and second respondents respectively.

I	A defence has not been filed on behalf of the first

or third respondents. The second and fourth respondents

have filed a defence by which those respondents either do

.. .

not admit or deny the allegations of fact contained in the statement of claim other than those relating

o the

jurisdiction of the Court, the status of the Commission, the

carrying on of business by the second respondent and the

status of the fourth respondent.

The fifth respondent

has

not filed a defence and has informed the Court that

he does

not wish to defend the proceeding, that

he cknowledges the

correctness of the allegations

of fact made against him and

that, in engaging in the conduct alleged,	he contravened the
provisions of the Act.

On 19 June 1984 directions were given by the Court

as to the conduct of the proceeding. The directions then

given included a direction that the Commission make

discovery on

or before 7 August 1984 with inspection

documents discovered on

or before 14 August 1984.

A list of the documents which the Commission had in

its possession, custody

or power was prepared on behalf

the Commission and was verified by the affidavit of Michael

John O'Neill, a member of the Commission's staff, sworn	30
August 1984.

The documents were identified in a schedule

containing Parts 1 - 8 inclusive. A claim was made that

certain of the documents identified in Parts 3, 4, 5 and 7

of the schedule and the documents identified

in Part 8 of

the schedule were privileged from production. It

unnecessary to refer further to Part

8. The grounds on

which the other documents were said to be privileged from

production were set out in the list of documents as follows:

as to the documents in Part

3 of the

Schedule numbered 3.5, 3.6 and 3.7, that the documents relate to settlement negotiations and are the subject of an agreement between the Applicant Cthe Commission3 and the first and third Respondents that the documents will not be used to the prejudice of the parties to the proceedings;

as to the documents in Part

4 of the

Schedule numbered

4.8 to 4.18 inclusive

and the documents in Part

7 of the

Schedule numbered 7.4, 7.7A and 7.9, that

the documents are subject to legal

professional privilege in that the

documents were brought into existence

for

the sole purpose of obtaining or

recording evidence to be used in the

proceedings herein

or recording requests

in relation to such evidence;

as to the documents in Part

5 of the

Schedule numbered 5.18 and 5.20, and

lso

the documents numbered 5.19 and 5.21 to the extent that those documents record legal advice, that the documents are

subject to legal professional privilege

in that the documents record legal advice

with respect to the proceedings herein;

as to the documents in Part

7 of the

Schedule numbered 7.5, 7.6, 7.7, 7.8 and

7.9, that the documents were brought into

existence by the Applicant's legal

advisers for the sole purpose of

recording evidence for use	in the
proceedings herein."

. -

When the matter came before the Court for further

directions on

2 October 1984, the second and fourth

respondents sought

an order that the Commission produce for

inspection by those respondents all

of the documents for

which privilege had been claimed. As the Commission had not

been given adequate notice of the application

I adjourned

the application for hearing on a later date and directed

that notice of motion be filed and served.

Notice of motion

was given returnable, with the

consent of the Commission, on

5 October 1984. The orders

sought in the notice of motion went beyond what

had been

envisaged when the matter was before the Court

on 2 October

1984 in that a claim was made based upon section

157 of the

Act that copies of certain of the documents

f o r which

privilege had been claimed, namely the documents numbered

3.6, 4.11, 4.16, 4.17. 7.5 and 7.6 in the schedule to the

list of documents, be furnished by the Commission

to the

second and fourth respondents.

The ground of that

application, as stated in the notice, was that the documents

were furnished to

r obtained by the Commission in

connection with the matters to which the proceeding relates,

that they tended

to establish the case of the second and

fourth respondents and that they were not obtained from

those respondents

or prepared by an officer

or professional

adviser of the Commission. The notice

of motion also sought

an order, either in addition or as

an lternative to the

order sought under section 157

of the Act, that the

Commission produce

for the inspection of the second and

fourth respondents each of the documents described in Parts

3 , 4, 5 and 7 of the schedule to the list of documents for

which privilege from production had been claimed.

Although no notice of the application under section

157 of the Act

had been given to the Commission prior to the

serving of the notice

of motion on

4 October 1984 (and

although the notice of motion did not expressly refer to that provision as being the basis of the claim), the Commission consented to that claim being argued when the

motion came before the Court on the following day.

I propose to refer first to the Commission's claim that the documents referred to in paragraphs

(a) to (d)

inclusive of the list of documents, the text of which

paragraphs is set out above, are privileged from production.

In my opinion the Commission

has in the material placed

before the Court established	a proper and sufficient
foundation for that claim.

It appears from the list of documents that by

memorandum dated 1 August 1983 the Assistant Commissioner of

the Commission requested advice in relation to the

proceedings from the Commission's professional legal

advisers. That statement has been amplified in the

affidavit of Michael

John O'Neill sworn 4 October 1984

wherein it

is stated that on

1 August 1983 the Commission

instructed its solicitors to act on its behalf

in this

proceeding which was then proposed to be brought by the

Commission. The proceeding was commenced in this Court on

25 May 1984.

Documents 3.5, 3.6

and 3.7 are described in the

schedule to the list of documents as follows

"3.5	Note by Applicant's legal adviser of telephone conversations with Plath, solicitor, on 20 and 23 July 1984.

3.6

Letter from Plath

& Bedford, solicitors,

to Australian Government Solicitor dated

30 July 1984.

3.7

Copy of letter from Australian Government

Solicitor to Plath

& Bedford, solicitors,

dated 9 August 1984."

It is common ground that Messrs Plath and Bedford

are, and were on the dates mentioned, the solicitors for the

first and third respondents.

It is also made clear by the list of documents that

document 3.5 is a note of a "without prejudice" discussion

between the legal adviser of the Commission and the

solicitor for the first and third respondents concerning

settlement negotiations in respect of the proceeding and

that documents

3.6 and 3.7 are "without prejudice"

correspondence between the solicitors.

Those documents are clearly the subject of

privilege from production: see Whiffen v. Hartwricrht (1848)

11 Beav. 111; 50 E.R. 759: Rabin v. Mendoza

& Co. C19541 1

: j

All E.R.

247: TNT Manaqement Pty. Ltd. v. Trade Practices

Commission (1983) 47 A.L.R.

693 at pp.701, 712.

Counsel for the second and fourth respondents did not, in the result, argue to the contrary.

He contended,

however, that the claim had not been sufficiently made out

in the list of documents and that it only became tenable by

virtue of the additional affidavit material filed on behalf

of the Commission

on 4 October 1984.

This submission can,

of course, go only to the question

of costs.

I note that in

an affidavit sworn by Alice Margaret Sproule on

21 September

1984 the document identified in the list of documents as

document 3.7 was referred to as

letter to the solicitors

for the first and third respondents seeking on a "without

prejudice" basis certain information. That affidavit also

referred to certain other "without prejudice" communications

between the Commission's solicitor and the solicitor for the

first and third respondents in relation to the proceeding,

The clear inference is that those communications are those

identified in the list of documents	as documents 3.5 and
3 . 6 .

On the material before me

I find that documents

3.5, 3 . 6 and 3.7 are privileged from production and that the

claim for privilege was properly made and supported in the

list of documents and the schedule thereto.

Documents 4.8 to 4.18 inclusive may be

described compendiously as notes made by officers of the

Commission of inquiries made of officers of companies refining and distributing petroleum products and correspondence between the Commission and those companies.

Legal professional privilege is claimed

for those documents

as having been brought into existence for the sole purpose

of obtaining

or recording evidence to be used

in the

proceeding or recording requests

in relation to such

evidence. The notes and correspondence all bear dates

subsequent to the date upon which instructions were given by

the Commission to its solicitors to act on its behalf in

connection with this proceeding.

Counsel for the second and fourth respondents did

not, in the end, dispute that the claim for privilege had

been established in respect of the documents, other than

documents 4.11, 4.16 and 4.17 but contended that it was only

the further affidavit of Michael

John O'Neill sworn on

October 1984 and filed on behalf of the Commission that

established the necessary foundation

for that claim.

It was submitted that the claim for privilege had

not been made out

in respect of documents 4.11,

16 and

4.17 because it should be inferred that there was

a duality

of purpose in bringing those documents into existence

so as

to displace the privilege which would have attached to them

had their existence been attributable solely to legal

proceedings contemplated at the time. There is evidence

before the Court in the form of the affidavit of Michael

John O'Neill sworn 4 October 1984 that those documents were

10.

brought into existence for the sole purpose of obtaining

recording evidence to be used in the proceedings which were

then contemplated. The deponent was not cross-examined on

his affidavit and no countervailing material was put before

the Court.

I find that the documents

4.8 to 4.18 inclusive are

privileged from production. I also find that that claim was

adequately and sufficiently made in the list of documents

and the schedule thereto.

Counsel for the second and fourth respondents did not press any claim in respect of the documents in Part

5 of

the schedule to the list of documents, those documents

bearing dates between

19 January 1984 and 23 May 1984 and '

being described

as internal records of the Commission

recording legal advice. I need say no more about those

documents.

The remaining documents

for which legal

professional privilege was claimed are documents

7.4 to 7.9

inclusive (including document	7.7A) described as statements
and records of interviews.

The ground of the claim in respect

of documents

7.4, 7.7A

and 7.9 is that the documents were brought into

existence by an officer of the Commission for the sole

purpose of obtaining

or recording evidence to

be used in the

proceedings. It is to be noted that the list of documents

11.

refers to document 7.9 in both paragraph (b) and paragraph

(d). The latter reference is obviously an error.

Documents 7.4, 7.7A and 7.9 fall into the same

category as documents

4.8 to 4.18 inclusive and

I have

reached a similar conclusion in respect of them. They are,

I '

therefore, properly the subject of privilege from

production.

The evidence before the Court

is that documents

7.5, 7.6, 7.7 and 7.8 were brought into existence by the Commission's legal adviser for the sole purpose of recording

evidence €or use

in the proceeding. They are therefore,

clearly the subject of legal professional privilege and	I
so find.

I turn now to the argument based

on section 157 of

the Act. That section provides:

"157. (1) Where

(a) a corporation makes

an application to

the Commission for

an authorization;

(b) the Commission gives

a notice under

sub-section 91(4) to a corporation to

which an authorization has been given;

(c)	a proceeding is instituted against a

corporation or other person under

section 77,

80 or 81; or

(d) an application

is made under section 80A

or sub-section 87(1A) for an order

against a corporation or other person,

the Commission

shall, at the request of the

corporation or

other person and upon

payment of

1 2 .

the prescribed fee (if any), furnish to the

corporation or other person -

(e)

a copy of every document that has been

furnished to,

or obtained by, the

Commission in connexion with the matter

to which the application, notice

proceeding relates and tends

establish the case of the corporation

other person; and

(f)

a copy of any other document in the possession of the Commission that comes

to the attention of the Commission

connexion with the matter to

which the

application, notice

or proceeding

relates and tends to establish the case

of the corporation or other person,

not being

a document obtained from the

corporation or other person or prepared by an

officer or professional adviser of the

Commission.

(21 If the Commission does not comply with a

request under sub-section (l), the Court shall,

subject to sub-section

(31, upon application by

the corporation which,

or other person who, made

the request, make

an order directing the

Commission to comply with the request.

( 3 ) The Court may refuse to make

an order

under sub-section

( 2 ) in respect of a document

or part of a document if the Court considers it inappopriate to make the order by reason that

the disclosure

of the contents of the document

or part of the document would prejudice any

person, or for any other reason.

(4) Before the Court gives a decision on an

application under sub-section

(21, the Court may

require any documents	to be produced to it for
inspection.

( 5 ) An order under this section may be

expressed to be subject to conditions specified

in the order."

The ground on which it is argued that

an order

should be made under that section in respect of the document

identified as document

3.6, being a letter dated

30 July

1984 from the solicitors for the first and third respondents

13.

to the Commission's solicitor, is that

"it may contain

something of significance concerning statements of fact by a

potential witness" which may affect the second and fourth

respondents. Counsel referred in support of this submission

to the following passage

in the judgment of Bowen C.J. in

Trade Practices Commmission v.

TNT Manaqement Ptv. Ltd.

(1981) 39 A.L.R.

665 at p.670:

"The intention disclosed by the wording

s.157 in relation to proceedings under

ss. 77,

80, BOA, 81 or 87(1A) is that

a corporation is

to be given fair treatment. in the sense that

it is to be given copies of documents which

the Commission has and which would, speaking

broadly, support the corporation's case. This

may be compared with the obligation placed

upon a prosecutor, who knows of

a credible

witness who can supply material facts which

tend to show an accused

is innocent, to make

the witness or his statement available to the

defence (see Archbold: Criminal Pleadinq,

Evidence and Practice 40th ed. p.281,

para

443; see also Maddison v. Goldrick C19761 1

NSWLR 651 at 6681.

It is for the second and fourth respondents to

establish that the document "tends to establish the case" of

those respondents. It is true that, as those respondents

have not seen the document, they are unable to give evidence

I	on the subject.

Accepting that it is sufficient

to come within

section 157 if the document tends to impeach the

Commission's case (Trade Practices Commission v.

TNT

Manaqement Ptv. Ltd., supra. at p.671).

I am not satisfied

14.

that any sufficient basis has been shown

from which to

conclude, or infer, that document 3 . 6 "tends to establish" the case of the second and fourth respondents in the

relevant sense. Nor do I think that a sufficient basis

has

been shown justifying the Court

in requiring the document to

be produced for the Court's inspection.

It was also contended that an order should be made under section 157 in respect of documents

4.11, 4.16 and

4.17, being letters to the Commission from

The Shell Company

of Australia Limited and Amp01 Limited and dated letters may contain material relevant to the effect of the alleged arrangement or understanding between the first, second and fifth respondents.

respectively 28 November 1983, 13 January 1984 and 16

In my opinion no sufficient foundation has been shown for the making of

an order under section 157 in

respect of those documents. Nor am

I satisfied that I

should order the production of the documents for the Court's

inspection. There is nothing in the material before the

Court which properly leads to

an inference that the letters,

if produced, would "tend to establish" the case of the	t
second and fourth respondents in the sense in which those

words are used

in section 157.

It remains to consider the claim that

an order

under section 157 should be made in respect

of documents 7.5

15-

and 7.6.

Those documents are described

in the list of

documents as statements of named persons brought into

existence by the Commission’s legal adviser for the sole

purpose of recording evidence for use in the proceeding.

That description has been supplemented by the affidavit of

Alice Margaret Sproule sworn

5 October 1984. The deponent

states that she is

a senior legal officer employed in the

office of the Australian Government Solicitor having the

conduct of the proceeding on behalf of the Commission.

Referring to documents

7.5 and 7.6 the deponent states

“I say that after such persons had been

interviewed for the purposes of these

proceedings, all of the said statements were

drawn up by me and

I then had the statements

typed and had them signed by such persons.“

Having regard to the dates which documents

7.5 and

7.6 bear, namely 24 and 25 August 1983, and the circumstance

that the relevant provisions of the statute creating the

Australian Government Solicitor, the Judiciarv Amendment Act

(No.2) 1984, did not come into operation until

1 July 1984,

the affidavit of Alice Margaret Sproule does not state

’expressly that at the date the statements were prepared she

was the legal adviser of the Commission. There is, however,

sufficient material in the affidavit to warrant the

conclusion that, prior to the coming into existence of the

body corporate known as the Australian Government Solicitor,

the legal adviser of the Commission in respect of this

proceeding was the Crown Solicitor for the Commonwealth,

that the deponent to the affidavit was, at the date

documents 7.5 and 7.6 were prepared, employed in the office

of the Crown Solicitor for the Commonwealth and that she

16.

then had the conduct of the proceeding on the Commission's

behalf. Indeed, no submission was put to the contrary.

The question then arises whether the statements

were "prepared by an officer or professional adviser of the

Commission" within the meaning of those words

in sub-section

157(1).

That question was considered by Bowen C.J. in Trade Practices Commission v. TNT Manaqement Ptv. Ltd.

(1981) 39

A.L.R. 665. Recognising that whichever of the alternative constructions of the provision put forward in argument would lead to difficulties, the learned Chief Judge concluded (at p.670) :

"In my opinion the words 'prepared

by an

officer of the Commission' refer to a document which has been drawn up by the officer, whether or not any particular contribution of ideas is evident in the contents of it. This appears to be the ordinary meaning of the word

'prepare' in relation to writings or

documents. It is consistent with the position

in other fields of the law

(see Re

Universal

Guarantee Pty. Ltd.: Ex parte Law Institute of

Victoria C19547 V.L.R. 650;

Ex parte

Cowlev-Cooper: Re Hodqson C19581

S.R. (NSW)

413 at 414; Barristers' Board

(W)

v. Tranter

Corporation Pty. Ltd. C19761 W.A.R.

65 at

70) ."

With respect,	I agree with and adopt his Honour's
conclusion.

Applylnq that view of the provision,

I am satisfied

on the basis of the uncontested material before the Court

17.

that each of the statements was prepared by Alice Marqaret

Sproule who was, at the relevant time,

a professional

adviser of the Commission. The documents are, therefore,

outside the purview

of section 157.

In the light of the conclusions

to which

I have

come it

is unnecessary to consider the question whether. if

a document falls within paragraph

(e) or paragraph (f) of

sub-section 157(1) of the Act and is not excluded by the

later words of that sub-section, the Commission may still

claim legal professional privilege and refuse to supply	a
copy of it.

For the reasons

I have set out above, the

application is dismissed. The second and fourth respondents

must pay the Commission’s costs of the application.

I certify that this and

the preceding

16 pages are

a true copy of the Reasons

for Judgment herein of the

Honourable Mr Justice

Neaves .

Dated: 10 October 1984

l	IN THE FEDERAL COURT OF AUSTRALIA	)
l	1
'	QUEENSLAND D W " REGISTRY	) No. Qld G 53 of 1984
)
GENERAL DIVISION	)

BEXHE33i:

TRADE PRACTICES

COMMISSION

Applicant

AND:

NASHCO PTY LIMITED

First Respondent

GARGEVA FTY LIMITED

Second Respondent

JOSEPH PATRICK NASH

Third Respondent

NEVILLE FRANCIS McCOSH

Fourth Respondent

RONALD JOHN JAMES DAVIS

Fifth Respondent

O R D E R

JUDGE MAKING ORDER : Neaves J.

DATE OF ORDER

10 October 1984

WHERE MADE

: Brisbane

'..

. -1'

THE COURT ORDERS THAT:

1. The application by the second and fourth

I	respondents be dismissed.

The

second and fourth respondents pay the

applicant's costs of the application.

IN THE FEDERAL COURT OF AUSTRALIA	)
1

QUEENSLAND	DISTRICT	REGISTRY	)	No.	Qld G 53 of 1984
)

DIVISION

GENERAL

)

BFIWEEN:

TRADE PRACTICES

COMMISSION

Applicant

AND:

NASHCO

LIMITED

PTY

First Respondent

GARGEVA PTY LIMITED

Second Respondent

JOSEPH PATRICK NASH

Third Respondent

NEWILLE FRANCIS McCOSH

Fourth Respondent

RONALD JOHN JAMES DAVIS

Fifth Respondent

CORAM: Neaves J.

U: 10 OCTOBER 1984

REISONS FOR JUDGMENT

Neaves J.

A proceeding is pending in this Court

a the suit

of the Trade Practices Commission

("the Commission") against

Nashco Pty, Limited ("the first respondent"), Gargeva Pty.

Limited ("the second respondent"), Joseph Patrick Nash

("the

third respondent"), Neville Francis McCosh

("the fourth

respondent") and Ronald

John James Davis ("the fifth

respondent") for pecuniary penalties and injunctive relief

in respect of certain alleged contraventions of paragraph

45(2)(a) of the Trade Practices Act 1974

("the Act").

The statement of claim filed on behalf of the

Commission alleges that each of the first, second and fifth

respondents at all material times carried on business as a

petrol retailer at Bwcd&erqz Queensland. those businesses

being respectively carried on under the business names

"Shell Speedy Service Station", "Amp01 Canelanders Service

Station" and "Bundaberg Star Service Station". It is

further alleged that on

r about 17 February 1983 the first

respondent by its servant

or agent the third respondent, the

second respondent by

its servant or agent the fourth

respondent, and the fifth respondent made an arrangement

arrived at an understanding between themselves and other petrol retailers at Bundaberg whereby the minimum retail

price of super-grade petrol supplied,

or to be supplied, at

Bundaberg by the parties to the arrangement

or understanding

would be fixed

or maintained at a particular level. The

material provisions of that arrangement

or understanding, so

it is alleged, had

a purpose, or had or were likely to have

an effect, falling within sub-section 45A(1) of the Act.

The third respondent, being

a director of the first

respondent, and the fourth respondent,

a director of the

second respondent, are alleged to have been directly

indirectly knowingly concerned in,

or a party to, the

conduct of the first and second respondents respectively.

A defence has not been filed on behalf of the first

or third respondents. The second and fourth respondents

have filed a defence by which those respondents either do

not admit or deny

the allegations of fact contained in the

statenent of claim other than those relating to the

jurisdiction of the Court, the status of the Commission, the

carrying on of business by the second respondent and the

s tat l lq

-- nf the fnllrth respondent. The fifth respondent has

not filed

a defence and has informed the Court that

he does

not wish to defend the proceeding, that he acknowledges the correctness of the allegations of fact made against him and

that, in engaging in the conduct alleged,	he contravened the
provisions of the Act.

On 19 June 1984 directions were given by the Court

as to the conduct of the proceeding. The directions then given included a direction that the Commission make

discovery on or before 7 August 1984 with inspection of documents discovered on or before 14 August 1984.

A list of the documents which the Commission had in

its possession, custody or power was prepared on behalf of

the Commission and

was verified by the affidavit of Michael

John O'Neill, a member of the Commission's staff, sworn	30
August 1984.

4 .

The documents were identified in a schedule

containing Parts 1 - 8 inclusive.

A claim was made that

certain of the documents identified in Parts

3, 4 , 5 and 7

of the schedule and the documents identified in Part

8 of

the schedule were privileged from production. It is unnecessary to refer further to Part 8. The grounds on which the other documents were said to be privileged from

production were set out

in the list of documents as follows:

as to the documents in Part

3 of the

Srhed~le

rnzhered 3.5:

3 . 6 and 3.7 - that

the documents relate to settlement Respondents that the documents will not be used to the prejudice of the parties to the proceedings;

negotiations and are the subject of an

agreement between the Applicant [the

as to the documents in Part

4 of the

Schedule numbered

4.8 to 4.18 inclusive

and the documents

in Part 7 of the

Schedule numbered

7.4. 7.7A and 7.9, that

the documents are subject to legal

professional privilege in that the

documents were brought

into existence for

the sole purpose

of obtaining or

recording evidence to be used in the

proceedings herein or recording requests

in relation to such evidence;

as to the documents

in Part 5 of the

Schedule numbered

5.18 and 5.20, and also

the documents numbered

5.19 and 5.21 to

the extent that those documents record

legal advice, that the documents are

subject to legal professional privilege

in that the documents record legal advice

with respect to the proceedings herein;

as to the documents in Part

7 of the

Schedule numbered

7.5, 7.6, 7.7,

7.8 and

7.9. that the documents were brought into

existence by the Applicant's legal advisers for the sole purpose of recording evidence for use in the

proceedings herein."

When the matter came before the Court for further

directions on

2 October 1984, the second and fourth

respondents sought an order that the Commission produce for

inspection by those respondents

all of the documents for

which privilege had been claimed. As the Commission had not

been given adequate notice of the application

I adjourned

the application for hearing on a later date and directed

that notice of motion be filed and served.

Notice of motion was given returnable, with the

consent of the Commission. on

S October 1984. The orders

sought in the notice

of motion went beyond what had been

envisaged when the matter was before the Court on

2 October

1984 in that

a claim was made based upon section

157 of the

Act that copies

of certain of the documents for which

privilege had been claimed, namely the documents numbered

3.6, 4.11, 4.16, 4.17, 7.5 and 7.6 in the schedule to the

list of documents, be furnished by the Commission to the

second and fourth respondents. The ground of that

application, as stated in the notice, was that the documents

were furnished to

or obtained by the Commission

connection with the matters to which the proceeding relates,

that they tended to establish the case of the second and

fourth respondents and that they were not obtained from

those respondents

or prepared by an officer

or professional

adviser of the Commission. The notice of motion

also sought

an order, either in addition

or as an alternative to the

order sought under section

157 of the Act, that the

Commission produce for the inspection of the second and

6 .

fourth respondents each of the documents described

in Parts

3 , 4, 5 and 7 of the schedule to the list of documents for

I	which privilege from production had been claimed.

Although no notice of the application under section

157 of the Act had been given to the Commission prior to the

serving of the notice of motion on 4 October 1984 (and

although the notice of motion did not expressly refer to

that provision as being the basis of the claim),

the

Commission consented to that claim being argued when the

mocion r=.me before

t h e

C O U K - ~

01-1

t h e foilouii~g

day.

I propose to refer first to the Commission's claim that the documents referred to in paragraphs

(a) to

(d)

inclusive of the list

of documents, the text of which

paragraphs is set out above, are privileged from production.

In my opinion the Commission has in the material placed

before the Court established	a proper and sufficient
foundation for that claim.

It appears from the list of documents that by a

memorandum dated 1 August 1983 the Assistant Commissioner of

the Commission requested advice in relation to the

proceedings from the Commission's professional legal

advisers. That statement has been amplified in the

affidavit of Michael John O'Neill sworn 4 October 1984

wherein It is stated that on

1 August 1983 the Commission

instructed its solicitors to act on its behalf

in this

proceeding which was then proposed to be brought by the

7 .

Commission.	The proceeding was commenced in this Court on
25 May 1984.

Documents 3.5, 3.6 and 3.7 are described in the

schedule to the list

of documents as follows

"3.5

Note by Applicant's legal adviser of telephone conversations with Plath,

solicitor, on

20 and 23 July

1984.

3.6

Letter from Plath

& Bedford, solicitors,

to Australian Government Solicitor dated

30 July 1984.

3.7

Copy of letter from Auscraiian

Govemmsnli

Solicitor to Plath & Bedford, solicitors, dated 9 August 1984."

It is common ground that Messrs

Plath and Bedford

are, and were on the dates mentioned, the solicitors for the

first and third respondents.

It is also made clear by the list of documents that

document 3.5 is a note of

a "without prejudice" discussion

between the legal adviser of the Commission and the

solicitor for the first and third respondents concerning

settlement negotiations in respect of the proceeding and

that documents 3.6 and 3.7 are "without prejudice"

correspondence between the solicitors.

Those documents are clearly the subject of

privilege from production: see Whiffen v. Hartwriqht (1848)

11 Beav. 111; 50 E.R. 759: Rabin v. Mendoza

& Co. C19541 1

All E.R.

247: TNT Manaqement Pty. Ltd. v. Trade Practices

Commission (1983) 47

A.L.R. 693 at pp.701. 712.

Counsel for the second and fourth respondents did

not, in the result, argue to the contrary. He contended,

however, that the claim had not been sufficiently made out

in the list of documents and that it only became tenable by

virtue of the additional affidavit material filed on behalf

of the Commission on 4 October 1984.

This submission can,

uf cwurse, go oiily to the ydesticr. sf ccsts.

n c t e thlt

an affidavit sworn by Alice Margaret Sproule on

21 September

1984 the document identifled in the list of documents

document 3.7 was referred to as

a letter to the solicitors

for the first and third respondents seeking on

a "without

prejudice" basis certain information. That affidavlt also

referred to certain other "without prejudice" communications

between the Commission's solicitor and the solicitor

for the

first and third respondents

in relation to the proceeding.

The clear inference

is that those communications are those

identified in the list of documents as documents	3.5 and
3.6.

On the material before me

I find that documents

3.5, 3.6 and 3.7 are privileged from production and that the

claim for privilege was properly made and supported in the

list of documents and the schedule thereto.

Documents 4.8 to 4.18 inclusive may be

described compendiously as notes made by officers

of the

Commission of inquiries made of officers of companies refining and distributing petroleum products and correspondence between the Commission and those companies.

Legal professional privilege is claimed for those documents

as having been brought into existence for the sole purpose

of obtaining or recording evidence to be used in the

proceeding or recording requests in relation to such

evidence. The notes and correspondence all bear dates

subsequent to the date upon which instructions were given by

the Commission to its solicitors to act on its behalf in

connection with this proceeding.

Counsel for the second and fourth respondents did not, in the end, dispute that the claim for privilege had been established in respect of the documents, other than

documents 4.11, 4.16 and 4.17 but contended that

it was only

the further affidavit of Michael

John O'Neill sworn on

October 1984 and filed on behalf of the Commission that established the necessary foundation for that claim.

It was submitted that the claim for privilege had

not been made out in respect of documents 4.11, 4.16 and 4.17 because it should be inferred that there was

a du lity

of purpose in bringing those documents into existence

so as

to displace the privilege

which would have attached to them

had their existence been attributable solely

to legal

proceedings contemplated at the time. There is evidence

before the Court in the form of the affidavit of Mlchael

John O'Neill sworn 4 October 1984 that those documents were

10.

brought into existence for the sole purpose of obtaining or

recording evidence to be used in the proceedings which were

then contemplated. The deponent was not cross-examined on

his affidavit and no countervailing material was put before

the Court.

I find that the documents

4 . 8 to 4.18 inclusive are

privileged from production. I also find that that claim was adequately and sufficiently made in the list of documents and the schedule thereto.

Counsel for the second and fourth respondents did not press any claim in respect of the documents in Part

5 of

the schedule to the list of documents, those documents

bearing dates between

19 January 1984 and 2 3 May 1984 and

being described as internal records of the Commission

recording legal advice. I need say no more about those

documents.

The remaining documents for which legal

professional privilege was claimed are documents

7.4 to 7.9

inclusive (including document	7 . 7 A ) described as statements
and records of interviews.

The ground of the claim in respect of documents

7.4, 7.7A and 7.9 is that the documents were brought into

existence by an officer of the Commission for the sole

purpose of obtaining or recording evidence to be used

in the

proceedings.

It is to be noted that the list

of documents

11.

refers t o document 7.9 in both paragraph

(b) and paragraph

(d).

The latter reference is obviously

an error.

Documents 7.4, 7.7A and 7.9 fall into the same

category as documents

4.8 to 4.18 inclusive and

I have

reached a similar conclusion in respect of them. They are,

therefore, properly the subject of privilege from

production.

The evidence before the Court is that documents

" - --a -l n --

7. .--..-

L L -L^ -...l

r+n.*ra h,? +hn

I .5, I . 6 . I . I auu

o WCL F U L U U ~ L L L

i11L.y =jnAd*.LL.L.C

Commission's legal adviser for the sole purpose of recording evidence for use in the proceeding. They are therefore, clearly the subject of legal professional privilege and I

so find.

I turn now to the argument based on section

157 of

the Act. That section provides:

"157. (1) Where -

(a)

corporation makes

an application to

the Commission for an authorization;

(b)

the Commission gives a notice under sub-section 91(4) to a corporation to which an authorization has been given;

(c)

a proceeding is instituted against a

corporation or other person under

section 77, 80 or 81; or

(d) an application

is made under section

80A

or sub-section 87(1A) for an order

against a corporation

or other person,

the Commission

shall, at the request of the

corporation or other person and upon

payment of

12.

the prescribed fee (if any), furnish to the

corporation or other person

(e) a copy of every document that

s been

furnished to, or obtained by, the

Commission in connexion with the matter

to which the application, notice or

proceeding relates and tends to

establish the case of the corporation or

other person: and

(f)

a copy of any other document in the possession of the Commission that comes to the attention of the Commission in

connexion with the matter to

which the

application, notice or proceeding

relates and tends to establish the case

of the corporation or other person,

not being

a document obtained from the

corporatdon nr other person or prepared by an

officer o r professional adviser of the

Commission.

( 2 ) If the Commissior, does not comply with a

request under sub-section

(l), the Court shall,

subject to sub-section

( 3 1 , upon application by

the corporation which, or other person who, made

the request, make an order directing the

Commission to comply with the request.

( 3 ) The Court may refuse to make

an order

under sub-section

( 2 ) in respect of

a document

or part of a document if the Court considers it

inappopriate to make the order by reason that

the disclosure of the contents of the document

or part of the document would prejudice any

person, or for any other reason.

(4) Before the Court gives a decision on an

application under sub-section

( 2 ) . the Court may

require any documents to be produced	to it for
inspection.

( 5 ) An order under this section may be

expressed to be subject to conditions specified

in the order.

The ground on which it is argued that an order

should be made under that section

n respect of the document

identified as document

3.6, being a letter dated

30 July

1984 from the solicitors for the first and third respondents

13.

to the Commission's solicitor,

is that "it may contain

something of significance concerning statements of fact by

potential witness" which may affect the second and fourth

respondents. Counsel referred in support of this submission

to the following passage

in the judgment of Bowen C.J. in

Trade Practices Commmission v.	TNT Manaqement Ptv. Ltd.
(1981: 39 A.L.R. 665 at p.670:

"The intention disclosed by the wording of

9.157 in relation to proceedings under

ss .

77,

80. eQF., A1 e r R7flAr is that ;I corpnretion 3s

to be given fair treatment, in the sense that

it is to be given copies of documents which

the Commission has and which would, speaking

broadly, support the corporation's case. This

may be compared with the obligation placed

upon a prosecutor, who knows

of a credible

witness who can supply material facts

which

tend to show an accused is Innocent, to make

the witness or his statement available

to the

defence (see Archbold: Crimlnal Pleadlnq,

Evidence and Practice 40th ed. p.281, para

443; see also Maddison

v. Goldrick C19767 1

NSWLR 651 at

668)

It is for the second and fourth respondents to

establish that the document "tends to establish the case" of

those respondents. It is true that, as those respondents

have not seen

the document, they are unable to give evidence

on the subject.

Accepting that It is sufficient

to come within

section 157 if the document tends to impeach the

Commission's case (Trade Practices Commission

Manasement Pty. Ltd., supra, at p.671).

I am not satisfied

14.

that any sufficient basis has been shown

from which to

conclude, or infer, that document

3.6 "tends to establish"

the case of the second and fourth respondents

in the

relevant sense. Nor do I think that

a sufficient basis has

been shown justifying the Court in requiring the document to

be produced for the Court's inspection.

It was also contended that

an order should be made

under section

157 in respect of documents 4.11, 4.16 and

4.17, being letters to the Commission from

The Shell Company

of Australia Limited and Amp01 Limited and dated

respectively 28 November 1983, 13

:~-.?-r--

_. ,1984 and 16

January 1984. The ground of the application

is that the

letters may contain material relevant to the effect of the

alleged arrangement

or understanding between the first,

second and fifth respondents.

In my opinion no sufficient foundation has been

shown for the making of an order under section

157 in

respect of those documents. Nor am

I satisfied that I

should order the production of the documents for the Court's

inspection. There is nothing in the material before the

Court which properly leads

t o an inference that the letters,

if produced, would "tend to establish" the case of the

second and fourth respondents in the sense in which those

words are used in section

157.

It remains to consider the claim that an order

under section

157 should be made

in respect of documents

7.5

15. I

and 7.6. Those documents are described in the list of

documents as statements of named persons brought into

existence by the Commission's legal adviser for the sole

purpose of recording evidence for use in the proceeding.

That description has been supplemented by the affidavit of

Alice Margaret Sproule sworn

5 October 1984. The deponent

states that she is a senior legal officer employed in the office of the Australian Government Solicitor having the conduct of the proceeding on behalf of the Commission.

Referring to documents

7.5 and 7.6 the deponent states

"I say that after such persons had been

interviewed for the purposes of these

proceedings. all of the said statements were

drawn up by me and

I then had the statements

typed and had them signed by such persons."

Having regard to the dates which documents 7.5 and

7.6 bear, namely 24 and 25 August 1983, and the circumstance

that the relevant provisions of the statute creating the

Australian Government Solicitor, the Judiciarv Amendment Act

(No.2) 1984, did not come into operation until

1 July 1984,

the affidavit of Alice Margaret Sproule does not state

expressly that at the date the statements were prepared she

was the legal adviser of the Commission. There

is, however,

sufficient material in the affidavit to warrant the conclusion that, prior to the coming into existence of the body corporate known as the Australian Government Solicitor,

the legal adviser of the Commission in respect of this

proceeding was the Crown Solicitor for the Commonwealth,

that the deponent to the affidavit was,

at the date

documents 7.5 and 7.6 were prepared, employed

in the office

of the Crown Solicitor for the Commonwealth and that she

16.

then had the conduct

of the proceeding on the Commission's

behalf. Indeed, no submission was put to the contrary.

The question then arises whether the statements

were "prepared by

an officer or professional adviser of the

Commission" within the meaning of those words	in sub-section
157(1!.

That question was considered

by Bowen C.J. in

Trade

P r a c t i c e s CoKuiisaion v. T:"T

:.kaacreiiiefit Ptv. Ltd.

::%l:

A.L.R.

665.

Recognising that whichever of the alternative

constructions of the provision put forward in argument would

lead to difficulties, the learned Chief Judge concluded (at

p.670):

"In my opinion the words 'prepared

by an

officer of the Commission' refer to

a document

which has been drawn up by the officer,

whether or not any particular contribution of

ideas is evident in the contents of it. This

appears to be the ordinary meaning of the word

'prepare' in relation to writings

documents. It is consistent with

the position

in other fields of the law (see Re Universal

Guarantee Pty. Ltd.;

Ex parte Law Institute of

Victoria C19547 V.L.R. 650; Ex parte

Cowlev-Cooper; Re Hodqson

C19583 S.R. (NSW)

413 at 414:

Barristers' Board ( W ) v. Tranter

Corporation Pty. Ltd.	C19761 W.A.R. 65 at
70).

With respect,	I agree with and adopt his Honour's
conclusion.

Applying that view

of the provision. I am satisfied

on the basis of the uncontested material before the Court

17.

that each of the statements was prepared by Alice Margaret adviser of the Commission. The documents are, therefore,

outside the purview

of section 157.

In the light of the conclusions

to which I have

come it is unnecessary to consider the question whether. if

a document falls within paragraph

(e) or paragraph (f) of

sub-section 157(1) of the Act and is not excluded by the

later KGids

t k t s ' & - s e ~ t i ~ n ,

t3e C C Z T ~ S S ~ C Z

still

claim legal professional privilege and refuse to supply a

copy of it.

For the reasons I have set out above, the

application is dismissed. The second and fourth respondents

must pay the Commission's costs of the application.

I certify that this and

the preceding 16 pages are

a true copy of the Reasons

for Judgment herein

of the

Honourable Mr Justice

Neaves .

Dated: 10 October 1984

[1984] FCA 324

10 Oct 1984