Trajkov v Payne Investments Pty Ltd (ACN 005 853 001) (Ruling)
[2018] VCC 1494
•19 September 2018
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE | Revised Not Restricted Suitable for Publication |
| SERIOUS INJURY LIST |
Case No. CI-16-02724
| LUBOMIR TRAJKOV | Plaintiff |
| v | |
| PAYNE INVESTMENTS PTY LTD (ACN 005 853 001) | Defendant |
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JUDGE: | HIS HONOUR JUDGE MISSO | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 19 August and 6 September 2018 | |
DATE OF RULING: | 19 September 2018 | |
CASE MAY BE CITED AS: | Trajkov v Payne Investments Pty Ltd (ACN 005 853 001) (Ruling) | |
| MEDIUM NEUTRAL CITATION: [Revised 27 September 2018] | [2018] VCC 1494 | |
RULING
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Subject: PRACTICE AND PROCEDURE
Catchwords: Litigation privilege – adequacy of affidavits relied on by the party claiming privilege – whether a report was commissioned for the dominant purpose of litigation
Legislation Cited: Transport Accident Act 1986, s3(1); Evidence Act 2008, s119
Cases Cited:Perry v Powercor [2011] VSC 308; Powercor Australia Ltd v Perry & Anor [2011] VSCA 239; IOOF Holdings Ltd v Maurice Blackburn Pty Ltd [2016] VSC 311
Ruling: Application refused.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Ms J Cowen | Slater & Gordon Lawyers |
| For the Defendant | Mr J Valiotis | Solicitor to the Transport Accident Commission |
HIS HONOUR:
Introduction
1 The defendant conducts a Budget Rent a Car business in Lilydale. Michael Nikolic (“Nikolic”) hired a truck from the defendant on 19 July 2013 for the purpose of transporting a refrigerated unit.
2 Nikolic enlisted the assistance of the plaintiff to assist him to transport the refrigerated unit. It was positioned within a “steel cage wall” at the rear of the truck. At one point the plaintiff was standing behind the truck when a chain broke, or gave way, or became detached, with the result that the steel-caged wall dropped or fell, resulting in injury to the plaintiff’s left hand.
3 The plaintiff commenced a proceeding alleging that the defendant was negligent.
The issue
4 There was no issue that the incident constituted a “transport accident” as defined in s3(1) of the Transport Accident Act 1986. There was also no issue that the Transport Accident Commission (“the TAC”) is the insurer for the defendant.
5 The defendant instructed an employee to investigate the circumstances of the incident by inspecting the truck, and in particular, the steel-cage wall. The employee was directed to undertake that investigation on 4 July 2015. He produced a covering letter and a six-page explanation of the product of his investigation.
6 Counsel for the plaintiff submitted that the report is discoverable. Counsel for the defendant submitted that it is not discoverable and is privileged because it was produced in contemplation of litigation.
The evidence
7 Wayne Henderson is the Chief Executive Officer of the defendant. He swore an affidavit on 14 July 2018. The relevant parts of it are as follows:
“…
3. The truck involved in the incident was a 2007 Isuzu. The truck was a 14 palet curtain sider with hanging gates attached to a track by chains.
4. The truck was sold to Greys Online Auction House on 11 May 2016.
5. The investigation report referred to in the defendant’s Affidavit of Documents is an Incident Report into the subject incident involving vehicle registered UTJ067. It was conducted subsequent to the incident and for the purposes of potential litigation and is the subject of Litigation Privilege.
… .”
8 Counsel for the plaintiff was highly critical of the content of the affidavit, submitting that it was inadequate to give foundation to the claimed privilege. I agreed. It was then that counsel for the defendant conceded that if the application proceeded based upon that affidavit evidence, that he would not be able to resist an order being made in favour of the plaintiff for the report to be discovered. Counsel for the defendant applied for an adjournment, which I granted.
9 On the adjourned date, counsel for the defendant produced a further affidavit sworn by Mr Henderson on 30 August 2018. The relevant parts of it are as follows:
“…
3. On or about 24 June 2015 the Defendant received a request from its Insurance Broker Delaney Kelly Goulding Pty Ltd to provide a report.
4. The report was required in order to address the incident alleged to have caused injury to the plaintiff on 19 March 2013 for the purpose of investigating liability exposure of potential position.
5. The report was completed by a servant/agent of the Defendant and provided to its insurer on or about 14 July 2015. It contains photographs and opinion material and was obtained after the alleged incident for the purpose of advising with respect to liability in the event of litigation.
6. The report was commissioned for the purpose of advising the Defendant’s insurer regarding the prospect of litigation against the Defendant arising from the alleged incident.
… .”
10 I infer that the defendant reported the incident to its insurance broker before it became clear to it that the TAC was the relevant insurer.
11 Counsel for the plaintiff maintained her submission that the evidence was inadequate to give foundation to the claimed privilege. Counsel for the defendant submitted that the dominant purpose of the direction to the employee was essentially to obtain instructions relevant to the cause of the incident said to have caused the plaintiff’s injury. Therefore, the report is privileged.
The relevant principles
12 Both counsel referred me to s119 of the Evidence Act 2008 which is relevant to the claimed privilege. Section 119 provides for litigation privilege as follows:
“Evidence is not to be adduced if, on objection by a client, the court finds that adducing the evidence would result in disclosure of—
(a)a confidential communication between the client and another person, or between a lawyer acting for the client and another person, that was made; or
(b)the contents of a confidential document (whether delivered or not) that was prepared—
for the dominant purpose of the client being provided with professional legal services relating to an Australian or overseas proceeding (including the proceeding before the court), or an anticipated or pending Australian or overseas proceeding, in which the client is or may be, or was or might have been, a party.”
13 The relevant legal principles were analysed by Robson J in Perry v Powercor (“Powercor”).[1] I will summarise them:
[1][2011] VSC 308. The Court of Appeal approved of his Honour’s analysis of the legal principles – Powercor Australia Ltd v Perry & Anor [2011] VSCA 239 at paragraph [15]
· Legal professional privilege is indispensable to the proper functioning of the judicial system and affords a guarantee of fundamental, constitutional and human rights. Absent waiver or abrogation by statute, the privilege is absolute.
· The provisions of the Evidence Act do not affect the operation of a principle or rule of common law or equity about evidence in a proceeding to which the provisions of the Act apply.
· The onus is borne by the party claiming privilege, and in this case, the defendant.
· The relevant test is the dominant purpose test, that is, that the report was not prepared for a plurality of purposes demonstrated by the relevant evidence.
· It is the purpose of the report which is relevant and not the motive of the individual who created it which matters. That purpose is to be established by examining the objectives of some person of “higher authority” within an organisation, such as the chief executive officer.
· The purpose for which a document is brought into existence is a question of fact that must be determined objectively.
· In determining the dominant purpose, a two-step approach must be undertaken – firstly determining the subjective purpose of the person making or commissioning the report. At least one purpose for which the report was commissioned must be capable of attracting the claimed privilege. Secondly, is the determination whether the privileged purpose was the dominant purpose in the commissioning of the report.[2]
· Counsel for the plaintiff referred me to IOOF Holdings Ltd v Maurice Blackburn Pty Ltd (“IOOF Holdings”)[3] and to the very extensive and helpful summary of the relevant legal principles of Elliott J.[4] His Honour’s summary is not controversial and entirely consistent with what I have summarised from Powercor. However, counsel for the plaintiff emphasised two particular principles referred to by his Honour. The first was that the material (that is, the affidavits) “must be focused and specific”,[5] and the second is that I should not examine the report if the defendant has not established the basis for the claimed privilege in the affidavits, although in an appropriate case it may be relevant to do so, especially where the parties agree to such a course being taken.[6]
[2]at paragraphs [43]-[55]
[3][2016] VSC 311
[4](Supra) at paragraphs [47]-[48]
[5](Supra) at sub-paragraph (8) under paragraph [47]
[6](Supra) at sub-paragraph (12) under paragraph [47]
Disposition
14 During the submissions of counsel for the plaintiff, and before I was taken to IOOF Holdings, I invited both counsel to provide me with a copy of the report. A copy was provided to me without objection. Despite the fact that I had the benefit of both affidavits and the report, I nonetheless decided it was appropriate to reconsider whether the affidavits established a basis for the claimed privilege.
15 I think what needs to be clearly understood is that it is necessary for the deponent to be somewhat cryptic in the manner in which documents over which privilege is claimed are described in an affidavit, because to do otherwise will give the game away. It is clear enough to me that Mr Henderson’s first affidavit was a poor effort at saying why there was a claim for privilege. However, his second affidavit makes it clear that the report was commissioned for an assessment of liability in contemplation of litigation which ultimately did eventuate.
16 Mr Henderson is a person of higher authority. He is the chief executive officer of the defendant. He has clearly stated that the objective in commissioning the report was in contemplation of litigation. Indeed, it was not just the dominant purpose, but the sole purpose. I think the evidence clearly demonstrates that when it is examined objectively.
17 In applying the two-step approach, I am satisfied that the defendant has discharged the onus it bears that the purpose for which the report was commissioned is capable of attracting the claimed privilege, and that the dominant purpose in it being commissioned was in contemplation of litigation.
Orders
18 I order that the plaintiff’s application is refused. I order that the defendant pay the plaintiff’s costs on an indemnity basis to be assessed by the Cost’s Court in default of agreement.
19 I consider that an order of this kind is appropriate, because the issue was one of serious importance which was responded to by the defendant very poorly. It obtained an indulgence to supplement its evidence by further affidavit material, putting the plaintiff to additional, and probably unnecessary, cost and expense.
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