Weidner v Cockrell, Kacavelis, Czygan

[2001] QSC 46

SUPREME COURT OF QUEENSLAND

CITATION:

Weidner  v Cockrell, Kacavelis, Czygan  [2001] QSC 046

PARTIES:

REINHHOLD BERNHARD WEIDNER and INGE WEIDNER
(Plaintiffs)
v
LEX DONALD COCKRELL
(First Defendants)
NICHOLAS KACAVELIS and MARY KACAVELIS
(Second Defendants)
HELMUT CZYGAN and ANNELIESE CZYGAN
(Third Defendants)

FILE NO/S:

 No 46 of 2000

DIVISION:

Trial

PROCEEDING:

ORIGINATING COURT:

Supreme Court at Cairns

DELIVERED ON:

1 March 2001

DELIVERED AT:

Cairns

HEARING DATE:

29/01/01

JUDGE:

Jones J

ORDER:

1.    The plaintiffs disclose to the solicitors for the first defendant the statements of the first and second plaintiffs dated respectively 22 and 24 September 1999 within 7 days of this order.

2.    the plaintiffs pay the defendants’ costs of and incidental to this action to be assessed.

3.    Each party has liberty to apply upon the giving of three days notice to the other parties.

CATCHWORDS:

PROCEDURE – DISCOVERY AND INTERROGATORIES – PRODUCTION AND INSPECTION – GENERALLY – OF WHAT PARTICULAR DOCUMENTS

PROCEDURE – DISCOVERY AND INTERROGATORIES – PRODUCTION AND INSPECTION – GROUNDS FOR RESITING PRODUCTION – LEGAL PROFESSIONAL PRIVILEGE – WAIVER OF PRIVILEGE – litigation arising from sale of farm wherein plaintiffs allege reliance upon misrepresentations as to financial returns and viability of farm – whether first defendant accountant acted in accordance with professional standards and norms of practice – independent statements ordinarily subject to legal professional privilege basis of expert report – expert report to be disclosed pursuant to r212(2) UCPR – whether privilege over statements waived dur to disclosure to expert.

Fair Trading Act 1989, s100
Uniform Civil Procedure Rules 1999, r212(2)

Interchase Corp Limited (in liquidation) v Colliers Jardine (Q) Pty Ltd (1997) QSC254, considered
Dingwall v Commonwealth of Australia (1992) 39 FCR 521, considered
Henderson v Low & Ors (2000) QSC 417, applied
Attorney-General (NT) v Maurice & Ors (1986) 161 CLR 475 considered
Great Atlantic Insurance Co. v Home Insurance Co. (1981) 1 WLR 529, considered
Mann v Carnell (1999) 74 ALJR 378, distinguished

COUNSEL:

 Mr. J. Jonsson, Solicitor, for the plaintiff and third parties
 Mr. A. Mellick for the first defendant

SOLICITORS:

 MacDonnells for the plaintiffs and third defendants
 Mellick Smith & Associates as Town Agents for Clayton Utz Lawyers for the first defendants

1. Before me are two applications.  The first is by the plaintiff, seeking directions for further conduct of the action and an order that the matter be entered for speedy trial.  The second application is by the first defendant for orders that the plaintiffs disclose statements by each of them respectively on 22 and 24 November, 1999 referred to in a financial report of chartered accountant Mr. Davies-Griffith. The first defendant also seeks an order that certain parts of the statement of claim be struck out.

1. The second part of the first defendant’s application has been overtaken by the fact that prior to the preparation of these reasons the plaintiffs have voluntarily amended the statement of claim by re-pleading paragraph 52 of the statement of claim, presumably to overcome the first defendant’s objections to the original pleading.  I propose therefore not to consider the arguments raised in this point but simply to adjourn the application.

1. The plaintiffs’ claim against the first defendant is for damages for breach of contract and/or negligence and/or for compensation pursuant to s.100 of the Fair Trading Act 1989.

1. The claim against the second and third defendants is for damages for deceit and/or for compensation pursuant to s.100 of the Fair Trading Act 1989.

1. The claim arises out of a sale of a farm used for the production of eggs, wherein the plaintiffs allege that in agreeing to purchase the farm from the second defendants they relied upon certain misrepresentations as to the financial returns and viability of the farm.

1. The first defendant is an accountant.  He was retained by the plaintiffs to advise them about the past trading of the farm, to prepare a cash flow projection for its continued operation and to assess its financial viability, having regard to the price.

1. The plaintiffs engaged Mr. Davis-Griffith to prepare an expert report going to the issue of whether the first respondent acted in accordance with the professional standards and norms of the practice of an accountant.

1. The ensuing report [1] by its paragraph 6 discloses that the information used in preparing the report was obtained from the two statements which the first defendant now seeks to have disclosed. The expert report must be disclosed in compliance with Rule 212(2) of the Uniform Civil Procedure Rules (“UCPR”). The statements however, were prepared for the purpose of litigation and prima facie therefore are subject to a claim of legal professional privilege. The point at issue in this application is whether that privilege has been waived.

   [1]Ex. “NB1” to the affidavit of Brooks 20 November 2000

1. For the applicant (first defendant) it is argued that by providing a copy of the statements to an expert for his/her consideration, legal professional privilege is waived.  I was referred particularly to a decision of Ambrose J in Interchase Corp Limited (In liquidation) v Colliers Jardine (Q) Pty Ltd[2] and a decision of Foster J in Dingwall v Commonwealth of Australia[3].

   [2](1997) QSC 254

   [3](1992) 39 FCR 521

1. The respondent/plaintiff contends that as the first defendant was present during all relevant conversations with the plaintiff, the claim for privilege could still be maintained, there being no unfairness to the first defendant.

1. The relevant authorities were examined recently by Chesterman J in Henderson v Low & Ors [4].  In that case the plaintiff sought disclosure of a statement of the defendant, a medical practitioner, which statement had been given to an expert for an opinion on a defence against allegations of professional negligence.  The expert report recounted extracts from the statement to support the opinion.  His Honour held, in reliance upon a number of cases but particularly Attorney-General (NT) v Maurice & Ors[5], that because the disclosure was to a third party “for a reason integrally connected to the subject matter of the litigation”, legal professional privilege had been waived.

   [4](2000) QSC 417

   [5](1986) 161 CLR 475. Other cases included Great Atlantic Insurance Co v Home Insurance Co (1981) 1WLR 529; Wigmore on Evidence (1961) 8.2290.

1. A more recent decision of the High Court Mann v Carnell[6]  concerned the action of the Chief Minister of the ACT disclosing to a member of the Legislative Assembly on a confidential basis legal advice received by the government for the limited purpose of demonstrating that the settlement of litigation did not involve a waste of public funds.  The High Court upheld a claim that in those limited circumstances legal professional privilege was not lost by disclosure to a third party on a confidential basis.  Disclosure in these circumstances was not inconsistent with the maintenance of the confidentiality which the privilege was intended to protect.

   [6](1999) 74 ALJR 378

1. The circumstances attending the claim for legal professional privilege in this case are that the disclosure of the privileged material was being made to an expert for an opinion which is required by the rules to be disclosed.  The disclosure to the third party is not for a limited or for actual purpose, but was integrally connected to the litigation.  Disclosure in such circumstances in my view constitutes a waiver of legal professional privilege and the documents therefore should be disclosed.

Application for directions and speedy trial

1. If it be the case that the amended pleadings now identify the issues between the parties there appears to be no reason why the matter cannot be entered for trial in the usual way.  The next sittings at which the action could be listed for hearing is not until 21 May 2001 before which time all the usual interlocutory steps could be undertaken.  In this event it is likely that a date of trial will be assigned during those sittings without the necessity of making an order for priority.  In these circumstances I will simply give the parties liberty to apply should there be any difficulty in meeting the expectations which I have just expressed.

Orders

1. I order that the plaintiffs disclose to the solicitors for the first defendant the statements of the first and second plaintiffs dated respectively 22 and 24 September, 1999 within 7 days of this order. 

1. I further order that the plaintiffs pay the defendants’ costs of and incidental to this action to be assessed.

1. Each party has liberty to apply upon the giving of three days notice to the other parties.