Warramunga Farms Pty Ltd as trustee for the Belconnen Trust v Burrows
[2025] WASC 13
•16 JANUARY 2025
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS
CITATION: WARRAMUNGA FARMS PTY LTD AS TRUSTEE FOR THE BELCONNEN TRUST -v- BURROWS [2025] WASC 13
CORAM: TOTTLE J
HEARD: ON THE PAPERS
DELIVERED : 16 JANUARY 2025
FILE NO/S: CIV 1310 of 2024
BETWEEN: WARRAMUNGA FARMS PTY LTD AS TRUSTEE FOR THE BELCONNEN TRUST
First Plaintiff/First Defendant by Counterclaim
MICHAEL COLYN REPACHOLI
Second Plaintiff/Second Defendant by Counterclaim
AND
ARTHUR PAUL BURROWS
First Defendant/First Plaintiff by Counterclaim
DOROTHY RUTH MIDDLETON
Second Defendant/Second Plaintiff by Counterclaim
RIVERINA FARMS PTY LTD as trustee of the PALOMAR TRUST
Third Defendant by Counterclaim
SIENNE MABETTE ATRACHE PERRIER
Fourth Defendant by Counterclaim
Catchwords:
Practice and procedure - Discovery and inspection - Application for inspection of documents over which legal professional privilege is claimed - Whether legal professional privilege has been waived - No waiver - Turns on own facts
Legislation:
Nil
Result:
Application dismissed
Category: B
Representation:
Counsel:
| First Plaintiff/First Defendant by Counterclaim | : | No appearance |
| Second Plaintiff/Second Defendant by Counterclaim | : | No appearance |
| First Defendant/First Plaintiff by Counterclaim | : | No appearance |
| Second Defendant/Second Plaintiff by Counterclaim | : | No appearance |
| Third Defendant by Counterclaim | : | No appearance |
| Fourth Defendant by Counterclaim | : | No appearance |
Solicitors:
| First Plaintiff/First Defendant by Counterclaim | : | Taylor Smart |
| Second Plaintiff/Second Defendant by Counterclaim | : | Taylor Smart |
| First Defendant/First Plaintiff by Counterclaim | : | Lotus Legal |
| Second Defendant/Second Plaintiff by Counterclaim | : | Lotus Legal |
| Third Defendant by Counterclaim | : | Taylor Smart |
| Fourth Defendant by Counterclaim | : | Taylor Smart |
Case(s) referred to in decision(s):
ASIC v Southcorp Ltd [2003] FCA 804
AWB Ltd v Cole (No 5) [2006] FCA 1234; (2006) 155 FCR 30
Fairhead v West Australian Newspapers [No 2] [2015] WASC 368
Gibbons v Wright (1954) 91 CLR 423
GR Capital Group Pty Ltd v Xinfeng Australia International Investment Pty Ltd [2020] NSWCA 266
Hughes v St Barbara Mines Ltd [2006] WASC 145
Plunkett v Bull [1915] HCA 14; (1915) 19 CLR 544
Poland v Hedley [2023] WASCA 69
Rossi v Qantas Airways Ltd [2024] FCAFC 144
TOTTLE J:
Introduction
A dispute has arisen as to whether the defendants have waived legal professional privilege in documents discovered by them. The plaintiffs allege legal professional privilege has been waived in three ways, by pleading defences that are inconsistent with maintaining privilege, by voluntary disclosure of an otherwise privileged document, and by disclosure of the reports of an expert witness. The plaintiffs seek orders compelling the defendants to permit inspection of the documents.[1]
[1] The application is brought by a letter filed on 27 November 2024.
The substantive dispute between the parties concerns agricultural land owned by the late Mr Keith Pond. Mr Pond died on 2 June 2023. Critical events in relation to the two transactions relating to the land and with which these proceedings are concerned occurred on 1 June 2023 when Mr Pond was in hospital and unwell. The defendants are the executors of Mr Pond's estate.
The first transaction is a contract for the sale of eight lots of land (described in the statement of claim as 'the Belconnen land') that the first plaintiff alleges was made between it as purchaser and Mr Pond as vendor.[2] The first plaintiff alleges the sale contract was made on or about 16 February 2023. The defendants do not admit the sale contract and contend that, if it was made, it is voidable ab initio.[3]
[2] Statement of Claim [4], [6].
[3] Amended Defence and Counterclaim [6].
The second transaction is a lease of four lots of land constituted in part by an agreement for lease dated 16 February 2023 but executed on 1 June 2023.[4] Mr Pond was named as the lessor and the second plaintiff as the lessee. The defendants deny Mr Pond granted the second plaintiff a lease but, in the alternative, contend that the lease was either void or voidable.[5]
[4] Statement of Claim [5], [15].
[5] Amended Defence and Counterclaim [28], [32]. In the interests of brevity, I will refer to the transactions as 'the sale contract' and 'the lease'. These references imply no judgment as to the validity of either transaction.
The first plaintiff seeks a declaration to the effect that the sale contract is valid and enforceable, specific performance of it or damages in lieu of specific performance. The second plaintiff seeks a declaration that the lease is valid and enforceable, specific performance and damages.
For present purposes the most significant issues raised by the defendants are the following. First, an allegation that the sale contract is liable to be set aside on the ground of undue influence.[6] Second, Mr Pond executed the sale contract in the mistaken belief that only some of the lots specified in the sale contract were the subject of the sale contract. Mr Pond was induced to make this mistake by the way in which the land the subject of the sale had been described in the sale contract. The defendants allege the first plaintiff was aware of Mr Pond's mistake and took advantage of it and consequently they have rescinded, or are entitled to rescind, the sale contract ab initio.[7] Third, Mr Pond did not sign the lease, alternatively when he signed it, he lacked capacity and the lease is void and of no force or effect.[8] Fourth and alternatively, when he signed the lease Mr Pond was unable to have any understanding of the true effect of the alleged lease and believed it was radically different from what it in fact was. In this respect the defendants rely on the doctrine of non est factum.[9] Fifth and in the further alternative, the defendants allege the fourth defendant by counterclaim, Ms Sienne Perrier, procured the execution of the lease on behalf of the second plaintiff (her de facto partner) by engaging in unconscionable conduct.[10]
[6] Amended Defence and Counterclaim [16] ‑ [20].
[7] Amended Defence and Counterclaim [21] ‑ [27].
[8] Amended Defence and Counterclaim [28].
[9] Amended Defence and Counterclaim [28A].
[10] Amended Defence and Counterclaim [29] ‑ [32].
Principal issues
Against that background and for the purposes of this application the principal issues on the pleadings may be summarised as follows:
(a)When the sale contract was executed was there a relationship between Mr Pond and Ms Perrier under which Mr Pond generally reposed trust and confidence in Ms Perrier, and did she occupy a position of ascendancy or influence over him, such that the sale contract should be set aside?
(b)Did Mr Pond execute the sale contract under a mistake of fact as to the extent of the land that was the subject of the sale?
(c)Did Mr Pond sign a document on 1 June 2023 the effect of which was either to vary the sale contract to relieve the first plaintiff of the requirement to pay fees or interest to Mr Pond (payable by reason of a delay in settlement) or to waive Mr Pond's entitlement to such sums?
(d)If Mr Pond did sign a document of the nature referred to in the preceding subparagraph, did he lack the capacity to do so and is the document therefore void and of no force or effect?
(e)On 1 June 2023 did Mr Pond lack capacity to execute a transfer of land in favour of the first plaintiff?
(f)Did Mr Pond execute a lease on 1 June 2023 and, if so, did he lack capacity?
(g)Is the lease of no force and effect by reason of the doctrine of non est factum?
(h)Did Ms Perrier obtain Mr Pond's signature to the lease and, if she did so, did she act unconscionably?
Some additional detail about the way in which the defences are developed is required.
The defendants plead that in February 2023 Mr Pond was 80 years of age and in failing health. They plead he was susceptible to complying with the wishes of others and this was demonstrated by the fact that on 20 March 2023 at the request of his sister he executed a handwritten will prepared by her and substantially to her benefit. The will was subsequently revoked.
The defendants plead that Mr Pond used names to describe the lots identified in the sale contract. They allege Mr Pond described three lots as 'Belconnen off Nambadilling' or 'Belconnen West', three lots as 'Belconnen off Bendering Hall' or 'Belconnen East' and two lots as 'Pinnacles East'.
The defendants plead that the mistake made by Mr Pond was that the land the subject of the sale contract was limited to the three lots that he described as Belconnen West, alternatively the Belconnen West lots and the three lots that he described as Belconnen East but in either case did not include Pinnacles East.
The defendants plead that Mr Pond was induced into thinking that the lots being sold were those he described as Belconnen West or Belconnen West and Belconnen East because on the first page of the sale contract the property the subject of the contract was described as 'Belconnen' Nambadilling Road, Kondinin.
The defendants plead that on 17 February 2023 and in the days following Mr Pond expressed his understanding that the second plaintiff and Ms Perrier had approached him to purchase Belconnen West, alternatively Belconnen West and Belconnen East and that he had told them that he was prepared to enter into a contract to sell Belconnen West, alternatively Belconnen West and Belconnen East, for a price of $2,070,000.
The defendants plead the price specified in the sale contract was very significantly below the true market value of Belconnen West, Belconnen East and Pinnacles East. Based on expert valuation evidence obtained by them, the defendants allege that the true value of the lots specified in the sale contract was $3,101,000. There is an issue between the parties as to the price in the sale contract but it was either $2,070,000 or $1,880,000. Further, the defendants allege Mr Pond believed the lots the subject of the sale contract to be worth approximately $3,880,000.
The defendants plead it was unlikely that Mr Pond wanted to sell Pinnacles East because Mr Pond had recently sold to his sister two lots which comprised the land known as 'Pinnacles West'. The two lots that made up Pinnacles West were located to the immediate west of Pinnacles East and there was, and is, no access to Pinnacles West other than by a private track running from Bendering Hall Road through Pinnacles East. Mr Pond expressed the intention that he would not sell Pinnacles East because it would cause Pinnacles West to be inaccessible by road.
The documents the subject of the application
Inspection of some of the documents originally sought by the plaintiffs has been provided voluntarily. The documents that remain the subject of the application are as follows:
(a)The defendants' discovered document 101 described as 'the Keith Pond will file'. In the plaintiffs' outline of submissions in support of the application, the application is expressed in the following expanded form:[11]
(i)the file held by DFG Legal which relates to the preparation and execution of Mr Pond's will executed on 25 May 2023 (Will) and enduring power of attorney made on 29 May 2023 (EPOA);
(ii)alternatively, of file notes and correspondence recording the discussion at a meeting at DFG Legal's offices on 20 April 2023 attended by Mr Pond and Ms Perrier, a draft will prepared by DFG Legal for Mr Pond by about 12 May 2023, and files notes, correspondence and other documents relating to Mr Pond's legal capacity and the properties that would comprise his estate.
(b)The defendants' discovered document 68 - 'Correspondence exchanged with Ross Lambert'.[12] Mr Lambert is the valuer retained by the defendants to give expert valuation evidence at trial. The defendants have discovered correspondence but have disclosed for inspection two redacted email chains and have not permitted inspection of other correspondence with Mr Lambert on the grounds that the communications relate to the other undisclosed 'workstreams' or concerns only 'logistics and related matters for the trial'.[13]
[11] Plaintiffs' submissions, 13 December 2024 [2(d)].
[12] Plaintiffs' submissions, 13 December 2024 [2(a)].
[13] Affidavit of Michelle McDiarmid sworn 11 December 2024, [8].
Document 101 – the Keith Pond will file
Relevant evidence
Reference to the following matters raised by the evidence is required.[14]
[14] The following affidavits were referred to in the parties' submissions and are taken to have been read for the purposes of the application: Affidavit of Peter Albert Nevin sworn 16 December 2024; Affidavit of Michelle McDiarmid sworn 11 December 2024; Affidavit of Michelle McDiarmid sworn 4 October 2024; Affidavit of Sienne Perrier sworn 19 September 2024.
Ms Perrier has deposed in an affidavit sworn by her on 19 September 2024 that she attended a meeting with Mr Pond at the offices of his solicitors, DFG Legal, on 20 April 2023. Her account of the meeting is as follows:[15]
11.Keith, Michelle McDiarmid ('Michelle'), who was employed as a lawyer by DFG Legal at the time, and another lawyer whose name I believe is Menike Adikari ('Menike'), were present at the meeting on 20 April 2023.
12.During the meeting, Michelle said words to the effect that there was going to be additional fees for drafting Keith's will and part of the reason was because they needed to do Landgate title searches for all the properties which Keith owned. I said words to the effect that Michael and I were purchasing Belconnen and Pinnacles East from Keith and that settlement on those properties was imminent. I said words to the effect that our settlement agents already have the title searches for the Belconnen and Pinnacles East properties which we could send to them.
13.Michelle said words to the effect that they needed to get their own title searches for Keith's properties to match the farm names Keith made mention of in his will. I said words to the effect that the title search documents make no mention of Coralinga, Lowlands, Hazeldean, or Woodhill and that these were local names known by farmers and locals in our area but not are referred to on the Landgate documents.
14.I also said words to the effect that I had a map with all of Keith's properties and their Avon locations, which referenced their lot numbers and that I could write the farm names on it to correspond with the Avon numbers. Menike asked me to send them this information.
15.After a period of time, Michelle asked me to leave the meeting as she said that she needed to speak with her client. I waited outside for about 30 minutes until Keith, Michelle and the other lawyer came out of the room. I then took Keith to Melville Volkswagen to meet Ruth.
16.During the time it took for DFG Legal to prepare Keith's will, I attended the premises on several occasions. Although I did not go into any other meetings apart from the one mentioned above, I saw Keith go into meetings with Michelle on more than one occasion.
[15] Affidavit of Sienne Perrier sworn 19 September 2024.
In an affidavit sworn by her on 4 October 2024 Ms Michelle McDiarmid, the defendants' solicitor, gave a substantially different account of an interaction with Ms Perrier on 20 April 2023. Ms McDiarmid's account was as follows:
8.On 20 April 2023, I was at DFG Legal's Annadale office. Ms Perrier called the office, and the call was diverted to me. I took Ms Perrier's call on speakerphone, with Ms Adikari in the room with me.
9.Ms Perrier said to me, 'I am Keith's bookkeeper', or words to that effect. Ms Perrier then said to me, in effect, that she had arranged for Mr Pond to instruct DFG Legal to prepare his will. She asked me questions about the particular documents that were required in order to identify Mr Pond's properties.
10.I told Ms Perrier, in effect, that DFG Legal could not discuss the matter of Mr Pond's will with her, or accept instructions from her, because Mr Pond was a client of the firm's and the firm owed him a duty of confidentiality. I did not give Ms Perrier any information in relation to Mr Pond's matter on that telephone call or at all.
11.I then told Ms Perrier that Mr Pond was welcome to come into the office to discuss his will, and Ms Perrier responded that she would bring him in.
12.I do not recall the date, it may have been later on 20 April 2023 or it may have been a later date, but I saw Ms Perrier, briefly, escort Mr Pond into the DFG Legal offices in Armadale. I did not attend a meeting with Mr Pond at which Ms Perrier was present, whether on 20 April 2023 or at all. My objection to meeting with Ms Perrier was as set out in my file note of 20 April 2023, which I conveyed to Ms Perrier on 20 April 2023, as I have set out above.
In her 19 September 2024 affidavit Ms Perrier deposed that on 12 May 2023 during a visit to Mr Pond at the second defendant's home he gave her a copy of his draft will for her to read and asked her what she thought.[16] Ms Perrier did not suggest that anyone else was present on this occasion.
[16] Affidavit of Sienne Perrier sworn 19 September 2024, [17].
Mr Pond made a will on 25 May 2023. A copy of the will has been discovered by the defendants. The will was prepared by DFG Legal. The file relating to the will is the subject of the application.
On 29 May 2023 Mr Pond executed an enduring power of attorney appointing the second defendant, who was his de facto partner, as his attorney and the first defendant as a substitute attorney in the event of the death or incapacity of the first defendant. The enduring power of attorney was prepared by DFG Legal but there is no evidence of when it was prepared other than it was before 29 May 2023. Mr Pond's signature on the power of attorney was not witnessed by representatives of his solicitors.
The defendants propose to adduce opinion evidence from medical practitioners about Mr Pond's capacity on 1 June 2023. One of those medical practitioners, Dr Peter McGuire was involved in caring for Mr Pond on 1 and 2 June 2023. In a report obtained by the defendants, Dr McGuire expressed the opinion that it was 'most unlikely that at any time on June 1 [Mr Pond] had legal capacity to manage his affairs'.
The defendants also propose to adduce the evidence of Dr Roger Clarnette. Dr Clarnette was not involved in caring for Mr Pond and his opinion is based on his assessment of information gleaned from the medical records. These included notes made by Mr Pond's general medical practitioner on 3 April 2023 which included observations about Mr Pond's mental state on that date. Dr Clarnette's opinion was expressed in the following terms:
I cannot say with any certainty at all whether Mr Pond had legal capacity or not at the time in question. Using a five point scale:
1.Probably capable
2.Possibly capable
3.Indeterminate
4.Possibly incapable
5.Probably incapable
On the balance of probabilities my best determination is that he possibly did not have legal capacity based on this five point scale across the spectrum of probable capacity to probable incapacity.
Dr Clarnette commented on Mr Pond's general medical practitioner's notes of Mr Pond's mental state on 3 April 2023 as follows:
The GP notes on 3 April 2023 do not really hold much weight as this was two months before the acute illness and this represents little evidence to inform his legal capacity on 1 June 2023. The GP's opinion that he would pass the [Mini Mental State Examination] is of little value in this determination.
Applicable legal principles
There was no dispute between the parties as to the principles applicable to determining whether legal professional privilege has been waived. The principles were summarised by the Court of Appeal in Poland v Hedley as follows:[17]
Legal professional privilege exists to protect the confidentiality of communications between the lawyer and client. It is inconsistency between the conduct of the client and the maintenance of the confidentiality which effects a waiver of the privilege. The assessment of whether a party has waived privilege is determined by considering whether, viewed objectively, the conduct of the privilege-holder is inconsistent with the maintenance of the confidentiality which the privilege is intended to protect. Where the privilege-holder's conduct objectively evinces the requisite inconsistency, the law will recognise the inconsistency and its consequences, even though such consequences may not reflect the subjective intention of the privilege-holder. The assessment is to be made in the context and circumstances of the case, and in light of any considerations of fairness arising from that context or those circumstances. Depending upon the circumstances of the case, considerations of fairness may be relevant to a determination of whether, objectively, there is inconsistency. There is not, however, some overriding principle of fairness operating at large. All the circumstances must be looked at, including whether any disclosure to a third party was on terms and in circumstances consistent with the preservation of confidentiality.
[17] Poland v Hedley [2023] WASCA 69 [72].
In GR Capital Group Pty Ltd v Xinfeng Australia International Investment Pty Ltd Macfarlan JA (with whom McCallum JA and Simpson AJA agreed) undertook an extensive review of the authorities from which he distilled the following propositions:[18]
(1)The test is one of inconsistency between the privilege holder's conduct and its maintenance of the privilege, not one of general fairness or of relevance to an issue in the proceedings.
(2)Enquiring whether the privilege holder has made express or implied assertions about the contents of the confidential communications, and whether its conduct has therefore 'laid open the communications to scrutiny', assists in ensuring that the court's focus is on inconsistency rather than simply relevance. If the privilege holder is understood to be asserting something about the contents of the communications, it is but a short step to conclude that it would be inconsistent for it to prevent those contents being scrutinised.
(3)On the other hand mere relevance of the content of the privileged communications to an issue raised in the proceedings by the privilege holder does not equate to inconsistency - something more is needed. It is of the essence of legal professional privilege that, if maintainable, it entitles a party to withhold potentially relevant documents from inspection by the other party.
(4)The determination of whether there has been an express or implied assertion about the contents of privileged communications giving rise to a relevant inconsistency is an evaluative decision to be made after consideration of the whole of the circumstances of the case. No hard and fast rules can be formulated. Those circumstances will include the degree of relevance of any advice to the issues in the proceedings, the centrality of the relevant issues in the proceedings and the likelihood of advice having been given, informed, as the High Court said in Mann v Carnell, by considerations of fairness.
(5)Having considered all those circumstances, the court must decide whether it would be inconsistent with the privilege holder's conduct for it to maintain privilege. The line between relevance to an issue and inconsistency in this context may be very fine and therefore one on which views might well differ.
[18] GR Capital Group Pty Ltd v Xinfeng Australia International Investment Pty Ltd [2020] NSWCA 266 [57].
The voluntary disclosure of privileged documents can result in a waiver of privilege over those documents and associated material. The test is whether the material the party has chosen to release from privilege represents the whole of the material relevant to the same issue or subject matter.[19]
Outline of opposing contentions
[19] AWB Ltd v Cole (No 5) [2006] FCA 1234; (2006) 155 FCR 30 [164].
The parties filed detailed and comprehensive written submissions. In the outline that follows I have summarised the effect of the principal contentions.
The plaintiffs contend that the defendants have put the following matters in issue:[20]
(a)The existence and extent of Mr Pond's mental capacity by reason of his age and 'failing health' on 16 February 2023 and thereafter.
(b)Mr Pond's state of mind as to the description of the land the subject of the Sale Contract on 16 February 2023 and thereafter.
(c)Mr Pond's susceptibility to influence on 20 March 2023 and thereafter.
(d)The existence and extent of Mr Pond's legal capacity on 1 June 2023.
[20] Statement of Claim [7].
The plaintiffs contend that documents on the will file are relevant to those issues. They advance four reasons why it is inconsistent with the maintenance of privilege over the will file for the defendants to have put in issue the matters referred to in the preceding paragraph. Those reasons are expressed as follows:[21]
(a)Mr Pond's mental capacity during the 20 April to 29 May 2023 period is relevant, by inference, both to his state of mind and capacity as at 16 February, 20 March and 1 June 2023. Records of Mr Pond having been assessed as having capacity during this period would make it less likely that he lacked the capacity to understand what land was the subject of the Sale Contract and so was less likely to be acting under a serious misapprehension or mistake. It would also affect the likelihood that he was susceptible to influence on 20 March 2023, and that he lacked capacity on 1 June 2023.
(b)The instructions given by Mr Pond during the 20 April to 25 May 2023 period in relation to the preparation of the Will also, by inference, are relevant to his understanding of the Sale Contract as at 16 February 2023. Records of Mr Pond's instructions as to the Land not forming part of his estate would make it more likely that he understood that the Land formed part of the Sale Contract. A draft will to that effect was prepared, according to Ms Perrier.
(c)Mr Pond, because of his death, is not available to give evidence as to his mental state during the period from 16 February 2023 to 1 June 2023.
(d)Accordingly, the contents of the will file are 'laid open to scrutiny' by the case the [defendants] seek to make — it is inconsistent to plead mistake and incapacity and yet deny access to the will file, which is likely to record consideration of the Land the subject of the Sale Contract and likely to record consideration of capacity relevant to Mr Pond's ability to make the Will end the [enduring power of attorney].
[21] Plaintiffs' submissions, 13 December 2024 [11].
Further the plaintiffs contend that Mr Pond's mental capacity before 1 June 2023 is relevant to the opinions expressed by Dr Maguire and Dr Clarnette. The plaintiffs contend that it is inconsistent with the maintenance of privilege over the will file for the defendants to propose to rely on the medical opinions, where the opinions ought to have taken account of the assessments of capacity carried out in the week to days before 1 June 2023. In any event, the plaintiffs contend that to properly test those opinions it will be necessary for them to be able to put to the medical experts the recorded assessments of Mr Pond's capacity made in the course of the preparation of the will and the enduring power of attorney.
The plaintiffs contend that because Ms Perrier attended a meeting with Mr Pond and solicitors from DFG Legal on 20 April 2023 anything said during that meeting and any notes or correspondence generated as a consequence of the meeting were either not confidential or privilege in such documents has been waived.
The plaintiffs contend that there has been a waiver of any privilege in the draft will prepared by DFG Legal that she says was disclosed to her by Mr Pond on about 12 May 2023.
The defendants' central contention is that the plaintiffs' waiver case rests on nothing more than an assertion that Mr Pond's will file is relevant to the matters in issue they have identified and the authorities demonstrate that relevance is not sufficient to ground waiver.
In addition, the defendants challenge the plaintiffs' contention as to relevance. They contend the authorities make it clear that questions of legal capacity are not at large but are time and task specific.[22] They contend that the only issue of capacity raised by the defence is whether Mr Pond had capacity to execute the three documents he is alleged to have executed on 1 June 2023. They contend the defences of undue influence and mistake assume Mr Pond had legal capacity to enter the sale contract.
[22] The defendants cite Gibbons v Wright (1954) 91 CLR 423, 438 and Rossi v Qantas Airways Ltd [2024] FCAFC 144 [40].
The defendants contend the asserted relevance of the will file to the medical evidence rests on speculation unsupported by any expert medical evidence.
The defendants contend no support for the waiver application can be drawn from Ms Perrier's evidence of the meeting she alleges took place on 20 April 2023 because that evidence is contradicted by Ms McDiarmid's evidence. No factual findings should be made in the face of the conflicting affidavit evidence. Further, Ms Perrier's credit will be in issue at trial and no finding of waiver should be made on the basis of her affidavit evidence untested by cross‑examination.
The contents of the will file could only be relevant to Mr Pond's testamentary capacity up to the date on which he signed his will - 25 May 2023. Although Mr Pond signed the enduring power of attorney on 29 May 2023 his signature was not witnessed by his solicitors and there is no evidence to suggest when the document had been prepared or whether a separate assessment of his capacity to sign the enduring power of attorney had been made.
Disposition - the will file
In my judgment there is no inconsistency between the defendants running their pleaded defences and maintaining legal professional privilege in the will file. There has been no express assertion as to the content of any advice received by Mr Pond that might be disclosed by inspecting the will file. Running the defences does not amount to an implied assertion as to the existence or content of any such advice. I make the following observations by way of further exposition of this conclusion.
The issue of Mr Pond's legal capacity must be approached with a level of precision that was not apparent in the plaintiffs' analysis. Legal capacity is not at large. It is time and task specific. This was explained by the High Court in Gibbons v Wright as follows:[23]
[T]he mental capacity required by the law in respect of any instrument is relative to the particular transaction which is being effected by means of the instrument, and may be described as the capacity to understand the nature of that transaction when it is explained. … 'one cannot consider soundness of mind in the air, so to speak, but only in relation to the facts and the subject-matter of the particular case'.
[23] Gibbons v Wright (1954) 91 CLR 423, 438.
Approached in a focussed manner it may be appreciated that alleging that Mr Pond lacked legal capacity on 1 June 2023 does not imply anything about his capacity on the days he executed his will and the enduring power of attorney or about his capacity in the period leading up to the execution of those instruments.
Similarly, and for the same reason, reliance on the medical opinions about Mr Pond's capacity on 1 June 2023 disclosed by the defendants does not imply anything about his capacity when he executed his will and the enduring power of attorney.
Reliance on presumed undue influence (supported by, among other matters, the allegation that Mr Pond was susceptible to the influence of others), and the mistake defence do not give rise to an issue about Mr Pond's legal capacity. Indeed, as the defendants point out, those defences assume the existence of capacity. The defences do not involve any assertion about the advice that may be recorded in the will file.
I accept the 'mistake defence' puts in issue Mr Pond's state of mind about which lots of land owned by him were the subject of the sale contract and there may be documents on the will file that are relevant to his state of mind but the relevance (actual or potential) of documents that are the subject of legal professional privilege is not sufficient to establish waiver.
The application is not assisted by Ms Perrier's evidence about her attendance at a meeting on 20 April 2023. Ms Perrier's evidence is contradicted by Ms McDiarmid's evidence. It is impossible on an interlocutory application of this nature to resolve conflicting affidavit evidence.
I am not prepared to rely on Ms Perrier's evidence about her conversation with Mr Pond on 12 May 2023. Evidence of conversations with a person who has subsequently died should be subjected to careful scrutiny as the deceased is not available at the hearing to admit, or directly deny, the specific allegations made by the witness giving evidence of those conversations.[24] It is readily apparent that Ms Perrier's evidence will be challenged at trial. It is not appropriate to decide the waiver application based on Ms Perrier's evidence of a conversation with Mr Pond without affording the defendants the opportunity to test that evidence by cross‑examination.
[24] Plunkett v Bull [1915] HCA 14; (1915) 19 CLR 544, 548 ‑ 549 (Isaacs J).
Document 68 - 'Correspondence exchanged with Ross Lambert'
The evidence
The controversy in relation to this correspondence concerns the defendants' refusal to permit inspection of the redacted email chains and other communications exchanged with Mr Lambert on the ground that they are unrelated to the preparation of the reports served by defendants and relate to 'workstreams' connected with the action but unrelated to the preparation of the reports or are concerned only with logistics and related matters for trial.
The defendants have filed and served three reports from Mr Lambert dated 13 May, 31 May and 19 September 2024 respectively. The 13 May and 31 May reports were filed on 10 June 2024. The 19 September report was a supplementary report filed on 30 September 2024.
In an affidavit sworn on 11 December 2024 Ms McDiarmid explained the defendants' position as follows:
2On 4 December 2024 the defendants/plaintiffs by counterclaim produced for inspection the following documents listed in Part IA of the affidavit of Arthur Paul Burrows filed and sworn 6 November 2024 (Defendants' List):
2.1correspondence exchanged with Mr Lambert in connection with his instructions to prepare the reports dated 13 May 2024 ( filed 10 June 2024 ), 31 May 2024 (filed 10 June 2024) and 19 September 2024 (filed 30 September 2024), being some of the documents described at item 68 of the Defendants' List (as to the other documents that form the balance of the documents described at item 68 of the Defendants' List, see paragraph 8 below);
…
5With respect to the documents produced for inspection and described in paragraph 2.1 above, two of those documents (which are chains of emails between Mr Lambert and myself) were disclosed in redacted form. Annexed hereto and marked MM-3 and MM-4 are true copies of those documents in their redacted form.
6.The parts that were redacted from the documents described in the previous paragraph were communications contained in email dated 14 and 19 June 2024 (MM-3) and 23 August 2024 (MM‑4) that related to a workstream that Mr Lambert was performing for the defendants/plaintiffs by counterclaim and which was not the preparation of the reports referred to in paragraph 2.1 above.
…
8.As stated in paragraph 2.1 above, only some of the documents described at item 68 of the Defendants' List were disclosed to the plaintiffs/defendants by counterclaim. The documents that were not disclosed are documents that comprise communications between me and Mr Lambert in relation to:
8.1workstreams that were not the preparation of the reports described in paragraph 2.1 above and for which privilege has not been waived, being the following documents:
8.1.1email from R Lambert to M McDiarmid dated 19 September 2024 attaching letter dated 19 September 2024;
8.1.2file note of meeting dated 18 October 2024;
8.1.3email from R Lambert to M McDiarmid dated 20 September 2024;
8.1.4email from R Lambert to M McDiarmid dated 22 October 2024;
8.1.5email from M McDiarmid to R Lambert dated 13 November 2024;
8.1.6email from R Lambert to McDiarmid dated 14 November 2024; email from R Lambert to M McDiarmid dated 24 September 2024;
8.1.7email from R Lambert to M McDiarmid dated 25 September 2024;
8.1.8email from M McDiarmid to R Lambert dated 25 September 2024; and
8.2logistics and related matters for the trial and for which privilege has not been waived, being the following documents;
8.2.1email from M McDiarmid to R Lambert dated 19 September 2024;
8.2.2email from M McDiarmid to R Lambert dated 24 September 2024;
8.2.3email from R Lambert to M McDiarmid dated 15 October 2024;
8.2.4email from M McDiarmid to R Lambert dated 22 October 2024;
8.2.5email from R Lambert to M McDiarmid dated 24 October 2024;
8.2.6emails to and from R Lambert to M McDiarmid dated 26 November 2024;
8.2.7email from M McDiarmid to R Lambert dated 2 December 2024; and
8.2.8email from R Lambert to M McDiarmid dated 2 December 2024.
Applicable legal principles
In ASIC v Southcorp Ltd,[25] Lindgren J identified six principles that applied to determining whether privilege had been waived in documents generated in the process of obtaining an expert report. His Honour's approach was followed in this court by Master Newnes (as his Honour then was) in Hughes v St Barbara Mines Ltd,[26] and by Kenneth Martin J in Fairhead v West Australian Newspapers [No 2].[27] Omitting his Honour's citation of supporting authorities the six principles identified by Lindgren J were as follows:[28]
[25] ASIC v Southcorp Ltd [2003] FCA 804.
[26] Hughes v St Barbara Mines Ltd [2006] WASC 145.
[27] Fairhead v West Australian Newspapers [No 2] [2015] WASC 368.
[28] ASIC v Southcorp Ltd [2003] FCA 804 [21].
(1)Ordinarily the confidential briefing or instructing by a prospective litigant's lawyers of an expert to provide a report of his or her opinion to be used in the anticipated litigation attracts client legal privilege.
(2)Copies of documents, whether the originals are privileged or not, where the copies were made for the purpose of forming part of confidential communications between the client's lawyers and the expert witness, ordinarily attract the privilege.
(3)Documents generated unilaterally by the expert witness, such as working notes, field notes, and the witness's own drafts of his or her report, do not attract privilege because they are not in the nature of, and would not expose, communications.
(4)Ordinarily disclosure of the expert's report for the purpose of reliance on it in the litigation will result in an implied waiver of the privilege in respect of the brief or instructions or documents referred to in (1) and (2) above, at least if the appropriate inference to be drawn is that they were used in a way that could be said to influence the content of the report, because, in these circumstances, it would be unfair for the client to rely on the report without disclosure of the brief, instructions or documents.
(5)Similarly, privilege cannot be maintained in respect of documents used by an expert to form an opinion or write a report, regardless of how the expert came by the documents.
(6)It may be difficult to establish at an early stage whether documents which were before an expert witness influenced the content of his or her report, in the absence of any reference to them in the report.
An outline of the opposing contentions
The plaintiffs contend that to the extent to which the documents comprise communications with Mr Lambert in respect of the action, privilege has been waived and the plaintiffs ought to be provided with the material to assess whether Mr Lambert's expressed opinion was or should have been influenced by that material. The plaintiffs contend that information considered by Mr Lambert for the purposes of the other workstreams may or should have affected his conclusions.
The defendants point out that the redacted emails and the other documents postdate the filing and service of Mr Lambert's first two reports and thus the undisclosed material could not be said to have influenced the content of either of those two reports.
As to Mr Lambert's supplementary report the defendants contend that as that was prepared in response to instructions received on 16 September 2024 to consider additional comparable properties the subject of a court order made on 5 September 2024, there is no basis to conclude that the information in the redacted emails related to the preparation of the supplementary report let alone influenced its content. Further, there is only one further communication exchanged on or before 19 September 2024 (the date of Mr Lambert's supplementary report) and that was an email from Mr Lambert to Ms McDiarmid attaching a letter from Mr Lambert. The defendants contend there is no basis for concluding that this communication emanating as it did from Mr Lambert could be said to have influenced the content of his report.
In answer to the plaintiffs' submission that they should be permitted to inspect the communications to assess whether Mr Lambert should have been influenced by the material the defendants say that is not the test. The test is whether the relevant material influenced the content of the expert report not whether it should have done so.
Disposition - correspondence exchanged with Mr Lambert
I do not accept that legal professional privilege has been waived in the communications between the defendants' solicitors and Mr Lambert. The plaintiffs' submissions appear to proceed on the basis that legal professional privilege in all communications between an expert witness and the lawyers for the party retaining the witness is waived on the disclosure of the reports. This approach does not reflect the applicable principles. It would lead to the loss of legal professional privilege in all communications between a party's expert witness and the lawyers instructing the expert.
It is only those documents that form part of the expert's instructions that are the subject of a waiver and the waiver is based on the inference that the documents could be said to influence the content of the report. In such circumstances it would be unfair for the party to rely on the report without disclosure of the instructions and accompanying documents.
In this case Ms McDiarmid has deposed that the communications relate to instructions given to Mr Lambert on matters concerning the action but other than in relation to the preparation of his reports. There is no reason why I should not accept Ms McDiarmid's evidence. Furthermore, given the dates of the communications none of the documents were capable of influencing Mr Lambert's reports of 13 and 31 August 2024. The circumstances in which supplementary report of 19 September 2024 was produced negates the inference the material redacted from the June and August 2024 emails influenced the content of the supplementary report. Mr Lambert's email and letter of 19 September 2024 did not form part of his instructions to prepare his supplementary report of that date and the inference that Mr Lambert's communication of 19 September 2024 contained material that influenced his report does not arise. Finally, the communications that postdate 19 September 2024 were neither capable of constituting instructions to Mr Lambert nor giving rise to an inference that their contents influenced his report.
Conclusion
The plaintiffs' application made by letter dated 27 November 2024 will be dismissed and I will hear the parties in relation to costs.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
CD
Associate to the Honourable Justice Tottle
16 JANUARY 2025
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