Worrell v Woods

[1999] FCA 242

FEDERAL COURT OF AUSTRALIA

Worrell (Trustee) v Woods [1999] FCA 242

BANKRUPTCY – application under s 30(5) Bankruptcy Act 1966 (Cth) – notice to produce documents - examination as to knowledge of bankrupt’s affairs – documents relevant to bankrupt’s affairs – evidence – privilege - common law right of former legal adviser of bankrupt to assert legal professional privilege against the trustee in bankruptcy when served with Notice of the Official Receiver under s 77C Bankruptcy Act 1966 (Cth) – whether excluded by necessary implication by Bankruptcy Act 1966 (Cth)

Bankruptcy Act 1966 (Cth) s 35, s 77, s 77AA, s 77C, s 81
Domestic Relationships Act 1994 (ACT)
Evidence Act 1995 (Cth) s 117, s 122
Income Tax Assessment Act 1936 (Cth) s 263, s 264
Corporations Law s 597

Re Steele;  Ex parteOfficial Trustee of Bankruptcy v Clayton Utz (1994) 48 FCR 236 applied
Bond v Tuohy (1995) 128 ALR 595 referred to
Re Bond;  Ex parte Ramsay (1994) 126 ALR 720 referred to
Re Furney (1964) 20 ABC 166 referred to

In reKonigsberg(a Bankrupt) [1989] 1 WLR 1257 referred to
Esso Australia Resources Ltd v Federal Commissioner of Taxation (1998) 159 ALR 664 applied
Baker v Campbell (1983) 153 CLR 52 applied
Commissioner of Taxation v Citibank Ltd (1989) 20 FCR 403 referred to
Perron Investments Pty Ltd v Deputy Commissioner of Taxation (WA) (1989) 90 ALR 1 referred to
Re Compass Airlines Pty Ltd (1992) 35 FCR 447 referred to
Commodity Futures Trading Commission v Weintraub 471 US 343 (1985) referred to
In re Wells;  Ex parte The Trustee (1892) 9 Mor 116 referred to
Minet v Morgan (1873) LR 8 Ch 361 referred to
Crescent Farm (Sidcup) Sports Ltd v Sterling Officers Ltd [1972] 1 Ch 553 referred to
Murjani (a bankrupt) [1996] 1 All ER 65 referred to
Ex parte Campbell;  In re Cathcart (1870) LR 5 Ch App 703 referred to
Goldberg v Ng (1995) 185 CLR 83 referred to

Moore “The Sanctity of Legal Advice:  Legal Professional Privilege and Bankruptcy” (1997) 5 Insolvency LJ 24
McNicol, Law of Privilege, 1992
Williams and Muir Hunter on Bankruptcy, 19^th Ed, 1979
Berry, Bailey and Schaw-Miller, Personal Insolvency, 1987
Spratt and McKenzie, Law of Insolvency, 2^nd Ed, 1972
2 Halsbury’s Laws of England, “Bankruptcy and Insolvency”, 1^st Ed, 1908
9 Am Jur 2d, “Bankruptcy” para 296

IVOR WORRELL and MORGAN GERARD JAMES LANE as Trustees of the Estate of David Gordon Fleming v PATRICK JOHN WOODS

A7003 of 1999

FINN J

CANBERRA

16 MARCH 1999

IN THE FEDERAL COURT OF AUSTRALIA
AUSTRALIAN CAPITAL TERRITORY DISTRICT REGISTRY	A7003 OF 1999

BETWEEN:	IVOR WORRELL and MORGAN GERARD JAMES LANE as Trustees of the Estate of David Gordon Fleming Applicant
AND:	PATRICK JOHN WOODS Respondent
JUDGE:	FINN J
DATE OF ORDER:	16 MARCH 1999
WHERE MADE:	CANBERRA

THE COURT ORDERS THAT:

The applicants bring in short minutes of order that give effect to these reasons.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
AUSTRALIAN CAPITAL TERRITORY DISTRICT REGISTRY	A7003 OF 1999

BETWEEN:	IVOR WORRELL and MORGAN GERARD JAMES LANE as Trustees of the Estate of David Gordon Fleming Applicant
AND:	PATRICK JOHN WOODS Respondent

JUDGE:	FINN J
DATE:	16 MARCH 1999
PLACE:	CANBERRA

REASONS FOR JUDGMENT

1. This application under s 30(5) of the Bankruptcy Act 1966 (Cth) (“the Act”) raises a narrow, but by no means inconsequential, issue. It is whether the former legal adviser of a bankrupt is entitled to claim legal professional privilege when served with a Notice of the Official Receiver under s 77C of the Act requiring the adviser to give evidence and to produce books in his or her possession relating to the bankrupt’s conduct, transactions, dealings, property and affairs.

2. It is conceded by the applicant that a like issue arises for bankrupts and their legal advisers (i) in relation to the exercise by the Official Receiver of its right of access to premises and books under s 77AA of the Act; (ii) to the bankrupt’s discharge of his or her duties to provide information, etc under s 77 of the Act; and (iii) to the conduct of an examination under s 81 of the Act. It likewise is conceded that some number of decisions at first instance in this Court have held or assumed that the provisions of at least s 77, s 77AA and s 77C do not, by implication, abrogate the right of a bankrupt or of his or her legal advisers to assert legal professional privilege as against the Official Receiver: see Re Steele;  Ex parteOfficial Trustee of Bankruptcy v Clayton Utz (1994) 48 FCR 236; Bond v Tuohy (1995) 128 ALR 595; Re Bond;  Ex parte Ramsay (1994) 126 ALR 720 at 725; Re Furney (1964) 20 ABC 166.

3. Section 77C of the Act, I should indicate at the outset, provides:

   “77C(1)         The Official Receiver, by written notice given to any person, whether a bankrupt or not, including any person employed by or in connection with a Department, or an authority, of the Commonwealth, of a State or of a Territory, may require the person:

   (a)       to give to the Official Receiver such information as the Official Receiver requires for the purposes of the performance of the functions of the Official Receiver or a trustee under this Act;  and

   (b)       to attend before the Official Receiver, or before an officer authorised in writing by the Official Receiver to exercise powers under this paragraph, and:

   (i)        to give evidence;  and

   (ii)       produce all books in the possession of the person;

   relating to any matters connected with the performance of the functions of the Official Receiver or a trustee under this Act.

   77C(2)            The Official Receiver or authorised officer may require the information or evidence to be given on oath, and either orally or in writing, and for that purpose may administer an oath.”

   The Application and its Setting

4. The present applicants, Ivor Worrell and Morgan Lane (“the trustees”) are the trustees in bankruptcy of the estate of David Gordon Fleming.  The respondent Patrick John Woods, had been retained by Mr Fleming as his legal adviser in a number of matters prior to the bankruptcy.  One such matter was an application by a Ms Wilkie against Mr Fleming under the Domestic Relationships Act 1994 (ACT), these parties having previously lived in a de facto relationship. Ms Wilkie was separately represented in those proceedings. On 18 August 1997 judgment by consent was given in favour of Ms Wilkie. It required that Mr Fleming transfer a number of properties to Ms Wilkie. On 13 January 1998 Mr Fleming was bankrupted on his own petition. In April 1998 the trustees lodged caveats over real property transferred to Ms Wilkie under the consent order. She in turn instituted proceedings in this Court seeking a declaration that the property transfers were not ones to which the avoidance provisions of s 121 of the Act apply. The trustees have filed both a defence and a cross-claim in that proceeding. It is listed for hearing on 16 March 1999.

5. On 17 July 1998 an Official Receiver’s Notice under s 77C of the Act was issued to Mr Woods requiring him (inter alia) to produce the books and documents in his possession referred to in the schedule to the Notice. These related in the main, though by no means exclusively, to the proceedings under the Domestic Relationships Act and to the various property transfers made in consequence of the consent order.

6. It is unnecessary to refer to the various other actions and matters for which the production of documents is required in the Notice. The substantive issue in relation to all documents etc sought is whether it is open to Mr Woods to assert a claim of legal professional privilege to such of them as fall within the scope of that privilege. The present application for an order under s 30(5) of the Act requiring Mr Wood to comply with the Notice was filed on 8 March 1999.

7. I should add for the sake of completeness that Mr Woods has been unable to obtain instructions from Mr Fleming in this matter, Mr Fleming’s present whereabouts being unknown.  While the privilege claim has been made by Mr Woods on his former client’s behalf, he has not sought to make submissions on the matters raised by the trustees in this proceeding.  I have not in consequence had the benefit of submissions controverting those of the applicants.

   Submissions and Conclusion

8. The principal submission made by the trustees is that, following what appears to be the accepted position in England, I should hold that a bankrupt (hence his or her legal adviser) is not entitled to assert legal professional privilege against the trustee in bankruptcy insofar as that claim concerns communications etc that relate to his or her “examinable affairs”.  That lack of entitlement, seemingly, results from the position of the trustee as “successor” to the bankrupt’s property and from the respective obligations of the bankrupt and the trustee under bankruptcy legislation:  see In reKonigsberg(a Bankrupt) [1989] 1 WLR 1257 at 1266-67. I have been invited in consequence to conclude that some number of single judge decisions of this Court are wrongly decided. The submission, it has been acknowledged, itself draws significantly upon Deputy District Registrar Moore’s interesting article “The Sanctity of Legal Advice: Legal Professional Privilege and Bankruptcy” (1997) 5 Insolvency LJ 24.

9. Given the view I feel compelled to take in this matter, it is sufficient for present purposes to deal with the applicant’s submission and my conclusions thereon in a compendious way.

   (i) The present issue arises in relation to an administrative notice under the Act, and not in respect of the adducing of evidence in a proceedings in this Court. Accordingly the client legal privilege provisions of the Evidence Act 1995 (Cth) have no bearing on this matter: Esso Australia Resources Ltd v Federal Commissioner of Taxation (1998) 159 ALR 664.

   (ii)       It is well accepted that at common law a person is entitled to preserve from compulsory disclosure the confidentiality of statements and other materials that have been made or brought into existence for the sole purpose of seeking or being furnished with legal advice or for the sole purpose of preparing for existing or contemplated litigation:  on this privilege see generally, McNicol, Law of Privilege, Ch 2, 1992.  While that entitlement can be overriden by statute, it is presumed that Parliament would only do so clearly by express words or by necessary implication:  Baker v Campbell (1983) 153 CLR 52.

   (iii)      In Re Steele, above, Ryan J held that s 77AA of the Act did not expressly or by implication disclose a legislative intention to abrogate a bankrupt’s (or his solicitor’s) right to assert legal professional privilege in relation to documents to which the Official Receiver sought access under that section. Subsequently, and of direct relevance for present purposes, His Honour in Bond v Tuohy, above at 602, applied Steele’s case “by parity of reasoning” to s 77C of the Act. And in Re Bond;  Ex parte Ramsay, above, it was not disputed in light of Steele’s case that s 77 of the Act for its part also did not abrogate the right to claim legal professional privilege.

   (iv)      Steele’s case and those following it, it should be emphasised, conform to the pattern of decisions of this Court in construing generically not dissimilar legislation requiring the compulsory disclosure or production under statute of information or documents required or sought by an administrative agency, a liquidator, etc, that have maintained the entitlement to claim legal professional privilege:  see eg Income Tax Assessment Act 1936 (Cth) s 263 and s 264, and see Commissioner of Taxation v Citibank Ltd (1989) 20 FCR 403 and Perron Investments Pty Ltd v Deputy Commissioner of Taxation (WA) (1989) 90 ALR 1; Corporations Law, s 597 and Re Compass Airlines Pty Ltd (1992) 35 FCR 447. Significantly in none of these various statutory contexts – bankruptcy, taxation and company liquidation – did the Court consider that the maintenance of the right to legal professional privilege would frustrate the purposes to be served by the investigative power in question. In Steele’s case, for example, Ryan J noted at 244:

   “Great emphasis was placed in argument upon the dire consequences which were said to follow a finding that legal professional privilege had not been abrogated.  However, I am not persuaded by this argument.  Here, the prejudice suffered by the Official Trustee would be limited to his inability to test or verify certain evidence which is readily obtainable by other means.”

   (v) Section 77C Notices may be addressed not only to a bankrupt but to “any person”. I would further note (a) that the powers of investigation and of examination granted by s 77AA and s 81 of the Act are likewise not restricted to investigation or examination of the bankrupt; as also (b) that s 597 examinations under the Corporations Law can extend to the examination of any person who may be able to give information concerning the examinable affairs of the corporation in question. For my own part, I would have to say that the extension of the Act’s investigative power to persons other than a bankrupt or his advisers provides telling reason in support of the conclusion arrived at in Steele and its successors on the issue of statutory construction. I mention this matter because as will be seen, the applicant’s submission does not seek to deny persons other than the bankrupt or his or her legal adviser, the right to claim privilege in a s 77C setting.

   (vi)      In the arena of corporate liquidation it is now accepted that such inconvenience to a liquidator as may be occasioned by the survival of legal professional privilege despite statutory powers of examination, is itself offset in relation to the company in liquidation by the right of the liquidator of that company to waive that company’s claims to privilege:  see Re Compass Airlines Pty Ltd, above, at 455; Re Dallhold Investments Pty Ltd (1994) 53 FCR 339. This right of the liquidator arises, not by virtue of any special rule of corporate insolvency, but by virtue of a liquidator’s powers and responsibilities in the winding up of the affairs of the insolvent company. In the United States where a like rule obtains in relation to corporate bankruptcy: see 9 Am Jur 2d, “Bankruptcy” para 296; 8A CJS “Bankruptcy” para 204(c); the Supreme Court has emphasised that the corporate management and control considerations that occasion this result could provide no justification for the assertion by a trustee of a like right of waiver of attorney-client privilege in cases of personal insolvency: see Commodity Futures Trading Commission v Weintraub 471 US 343 at 356-357 (1985). The court indicated that if the trustee of a private individual was to have such a right of waiver, it would need a “different theory” to sustain it. There would appear to be little evidence in support of such a theory in that country: see “Annotation: Power of Trustee in Bankruptcy to Waive Privilege of Communications Available to Bankrupt” 31 ALR 3d 557.

   (vii)     The applicant in the present matter nonetheless propounds such a “different theory”.  As developed in oral submissions it would appear to entail the following:

   (a)       Steele’s case and those following it are correctly decided to the extent that they have held that s 77AA and s 77C do not abrogate the right to claim legal professional privilege. Nonetheless, insofar as they relate to such a claim by a bankrupt (or his or her legal adviser) but not by a third party, they are decisions per incuriam in that consideration was not given to such right as a trustee in bankruptcy has to waive the bankrupt’s claim of privilege in respect of matters relating to the bankrupt’s property and property dealings.

   (b)       The alleged right of waiver is accepted in English law in relation to court examinations of bankrupts:  see In re Konigsberg (a Bankrupt), above:  Williams and Muir Hunter on Bankruptcy, 117, 19^th Ed, 1979;  Berry, Bailey and Schaw-Miller, Personal Insolvency, paras 21.8 and 21.9, 1987;  and has, seemingly, been acknowledged at some time in some Commonwealth countries:  see eg in New Zealand, Spratt and McKenzie, Law of Insolvency, note 70/3 to s 70, 2^nd Ed, 1972.  It should be accepted and applied as part of the common law of this country.

   (viii) The English position, as I understand it, is as stated in the nineteenth edition of Williams and Muir Hunter, above, at 117 in the commentary on the examination of solicitors in proceedings akin to those under s 81 of the Australian Act:

   “The solicitor’s position varies according to whether he is asked for information, or examined, as solicitor to the bankrupt or to some other person.  In the case of the bankrupt, the relevant right of privilege must, over a great part (though not the whole) of its range, belong to and be exercisable by the trustee, against whom in that area privilege cannot be pleaded … .”

   The footnote reference is as follows (and I will return to the cases mentioned): 

   “Re Wells (1892) 9 Mor. 116;  and cf. Minet v Morgan (1873) LR 8 Ch 361.”

   In the same commentary it is later observed.

   “In the case of persons other than the bankrupt, matters communicated to their solicitor for the purpose of obtaining his professional advice and assistance are privileged from disclosure over the whole of the range.”

   (ix)      The reference in the commentary quoted above that the privilege belongs to the trustee though only “over a great part (though not the whole) of its range” would seem to refer to whether the communications, etc in question relate to matter that may properly be the subject of inquiry on a bankruptcy examination by the court.  If not, the bankrupt’s right remains in the bankrupt’s own hands.  And so, for example, the ruling of the Council of the Law Society in England in its 1974 “Guide to Professional Conduct of Solicitors” advised, perhaps unsurprisingly, that:

   “11.2   In the light of counsel’s advice, it must be said that the extent to which a solicitor can and should plead privilege when he is faced by a request from an Official Receiver or a Trustee in Bankruptcy to answer questions relating to the transactions of, and his own dealings with, a client or former client who has had a Receiving Order made against him or who has been adjudged bankrupt, is not in all respects clear.  Each case must necessarily turn on its own circumstances.”

   The Council went on by way of illustration to suggest that:

   “(e)     Questions relating to the client’s personal life, and his personal affairs, including his defence to the bankruptcy proceedings which have led to the Receiving Order of Adjudication, to criminal proceedings and divorce proceedings, except so far as they relate directly to the client’s property, should be answered only with the client’s authority.
    (f)      If the advice sought from or given by the solicitor related solely to some particular item of property or right of the client which as the result of his adjudication in bankruptcy is vested in the Trustee, the benefit of the privilege would have passed to the Trustee and privilege may not be a ground for refusing to disclose the advice to the Trustee.”

   (x) The underpinning of the English rule would seem to be twofold. The first is that the trustee acquires the right of the bankrupt in relation to the privilege insofar as the privilege itself relates to the property and rights of the bankrupt, by virtue of that property and those rights vesting in the trustee as “successor in title” to the bankrupt under the bankruptcy legislation: cf the Act s 116(1)(a) and (b); and see In re Konigsberg (a Bankrupt), above;  on privilege and successors in title generally see Crescent Farm (Sidcup) Sports Ltd v Sterling Officers Ltd [1972] 1 Ch 553 and Minet v Morgan, above – one of the two cases footnoted in the commentary quoted above from Williams and Muir Hunter.  The second underpinning, at least insofar as a bankrupt’s solicitor is concerned, would seem to be that the solicitor can be required to disclose information and documents that the bankrupt would be required to disclose on examination by the court:  see Murjani (a Bankrupt) [1996] 1 All ER 65 at 72; the apparent assumption being that information etc requested by a bankrupt at the examination was not a proper subject of a privilege claim by the bankrupt as against the trustee because, apparently, of the “vesting” of that privilege in the trustee: see Williams and Muir Hunter, above, at 117.

   (xi)      The case that is generally regarded as establishing this position in relation to privilege claims by the legal adviser of a bankrupt former client is In re Wells;  Ex parte The Trustee (1892) 9 Mor. 116 – the other of the two cases referred to in the Williams and Muir Hunter footnote to which I have referred.  It is asked to carry a weight it is arguably incapable of bearing.  At the time of this decision there was authority enough for the proposition that solicitors ordinarily could claim privilege for their clients at a bankruptcy examination:  see eg Ex parte Campbell;  In re Cathcart (1870) LR 5 Ch App 703. The report of Well’s case is so brief that it can be set out in full (omitting counsel’s references to authorities):

   “THIS was a Report by the registrar to the Bankruptcy judge by reason of the refusal of one Arthur Hepburn Hastie, the solicitor to the debtor, to answer a certain question permitted by the Court to be put to him at a private examination.

   The debtor, A E Wells, was formerly proprietor of the Pelican Club, and a receiving order was made against him on November 6^th, 1891.

   At a private examination of Mr Hastie, who had acted as solicitor to the debtor, the registrar allowed the following question to be put: - ‘Which was the first transaction in which you acted for Mr A E Wells in connection with the Pelican Club?’

   This question the solicitor refused to answer, in consequence of which the matter was now referred to the judge.

   Mellor (Herbert Reed with him):  for the trustee in bankruptcy.

   The question was a perfectly proper one, and the Court allowed it to be put.  The solicitor has no ground whatever that I can see for refusing to answer it.

   Fraser:  for the solicitor.

   To answer this question would be to disclose communications made by the client to the solicitor for the purpose of obtaining his professional advice.  Under such circumstances the witness was bound to withhold the information.

   [Vaughan Williams, J:  All that he is really asked is when he was first employed.]

   He is not merely asked what was the date of the first transaction.  The question is, ‘Which was the first transaction in which you acted for Mr Wells in connection with the Pelican Club?’  That was an enquiry as to the subject-matter, and if the solicitor answered it it would be to disclose facts communicated by the client.  The solicitor believed privilege to exist, and he claims it.

   Vaughan Williams, J:

   In my opinion there is nothing in this objection.  The solicitor must answer the question.  I have no doubt that Mr Hastie conscientiously refused to answer, but he ought to have done so.  The application of the trustee must be allowed with costs.”

   (xii)     It is not altogether surprising that this brief decision has over time been regarded as authority for diametrically opposed propositions.  So, for example, in 2 Halsbury’s Laws of England, “Bankruptcy and Insolvency” para 243, 1^st Ed, 1908, Well’s case is cited in support of the unqualified proposition that, on a bankruptcy examination:

   “Matters which have been communicated to a solicitor for the purpose of obtaining professional advice and assistance are privileged, and a solicitor, if he is being examined, cannot be asked as to such matters, but he can be asked as to matters not communicated in professional confidence.”

   A like view of the import of Well’s case seems to have been taken by Clyne J in Re Furney, above, at 169. To be set against these is the opinion expressed over time in Williams (and then Williams and Muir Hunter) on Bankruptcy to which I have referred.

   (xiii)     While not referring to the English rule as such, Ryan J in Re Steele made the following observations on the significance of the vesting provisions of the Bankruptcy Act to the question of a claim for legal professional privilege (above, at 245).

   “I do not regard the provisions of the Act which vest the property of the bankrupt in his trustee as affecting the conclusion that I have reached nor do I regard them as vesting the privilege itself in the Official Trustee. This is not to say that there may not be communications between a bankrupt and his or her legal advisers which are so closely connected with the property of the bankrupt which vests in the trustee that the bankrupt is precluded from asserting legal professional privilege as against the trustee.”

   Whatever the force of the last sentence in this quotation – and I mean no disrespect in saying its burden is not altogether self-explanatory – the quotation itself does not lend support for the theory supporting the English rule.  For my own part I am unable to discern the precise rationale at common law for the exceptional case to which His Honour refers in which a bankrupt would be precluded from asserting privilege.  His Honour seems to have expressly rejected a rationale based on the trustee being a successor in title to the property in question.  I would add, furthermore, that without the assistance of submissions from the trustees on the justification for, and scope of, the exceptional case, I do not consider that it is of assistance in resolving the present application.

   (xiv)     While there may be sound reasons in public policy for the law of this country to adopt a rule which in some circumstances denies a bankrupt the right to assert legal professional privilege against his or her trustee, it is neither desirable nor appropriate that I accede in this matter to the course held out by the trustees in their submissions and for a number of reasons.  First, in the absence of explicit prior recognition in the common law of this country of the elements of a rule such as obtains in England, and in the face of an understanding to the contrary of that rule established in some number of decisions of this Court, it would require compelling reasons for a judge at first instance to make an innovation such as is now advanced.  Secondly, the particular innovation proposed is itself by no means free from difficulty.  I have attempted to indicate that both in its provenance and in its scope the proposed rule appears to have its ambiguities and uncertainties.  And as the Council of the Law Society indicated in the “Guide” to which I have referred, the position of a solicitor claiming privilege is “not in all respects clear”.  I am not persuaded that the English rule itself is necessarily an appropriate one for adoption in this country.  Thirdly, the fact that it may be open to a liquidator to waive a company’s right to privilege does not of itself provide justification for according a like right to a trustee in bankruptcy in respect of a bankrupt’s right at least in relation to matters that can properly be said to be “examinable affairs”: see the Act s 5(1) and see Commodity Futures Trading Commission v Weintraub, above, at 356-357. Fourthly, the existence of a bankrupt’s right (or his solicitor’s obligation) to assert privilege in cases within sections 70, 77AA and 77C of the Act has not apparently led to significant untoward effects being felt in the administration of bankrupt estates – though, doubtless, the abrogation of that privilege could well have facilitated the pursuit of claims and the recovery of property by a trustee for the benefit of creditors. Fifthly, the experienced judges of this Court who held or have assumed the subsistence of the privilege notwithstanding the provisions of the Act to which I have referred, while not unmindful of the effect of the privilege on the investigative powers of the Official Receiver or a trustee, have, in my respectful view, accorded that privilege the priority which it currently enjoys in the common law of this country. It may be valued somewhat differently in other common law jurisdictions. While it would be open to the Full Court of this Court to view those decisions differently, I ought as a matter of comity follow them and in particular, because it relates to s 77, Bond v Tuohy, above.  Sixthly, it may well be the case that not the last word has been said on the disclosure obligations imposed on a bankrupt by the provisions of the Act – I refer in particular to s 77 and s 265 – and of the consequence these may have for a bankrupt’s right to assert a claim of legal professional privilege. I would also note that in Re Bond;  Ex parte Ramsay, it was assumed s 77 of the Act did not abrogate the right to privilege: cf Re Murjani (a bankrupt), above.  I have not been addressed on this matter nor on the consequences a view contrary to that in Re Bond would have for privilege claims by a bankrupt or, distinctly, by his or her legal adviser, in relation to s 77AA, s 77C and s 81 of the Act. I refrain from expressing any view on these matters.

1. In the event then I reject the principal submission of the trustees.

   Alternative Submission

2. The trustees have submitted that, under the shadow of the Evidence Act a bankrupt should be precluded from asserting privilege against a trustee in bankruptcy given, so it is claimed, that by virtue of the definition of a “party” in s 117 of that Act, a trustee in legal proceedings could waive privilege under s 122 with the consequence that in such proceedings the bankrupt’s former legal adviser could be required to put in evidence documents or information otherwise protected by the privilege. Of this I need only say that in substance the submission requires an analogical use be made of the Evidence Act that the Full Court of this Court held to be inappropriate in Esso Australia Resources Ltd v Federal Commissioner of Taxation, above.

3. More faintly it was submitted that I should in the circumstances and on grounds of fairness impute a common law waiver of the privilege by Mr Fleming:  on waiver see Goldberg v Ng (1995) 185 CLR 83. It is conceded that this submission is merely an alternate formulation of that based on the analogy of the Evidence Act. I reject it for like reasons.  I would add that in any event I am unable in the circumstances to discern “some act or omission” of Mr Fleming which could provide the necessary basis upon which an imputed waiver could be erected:  see Goldberg v Ng at 96.

   Conclusion

4. The substantive issue in this application must be decided adversely to the applicants.  It is competent and proper for Mr Woods to assert a claim to legal professional privilege in respect of such documents referred to in the Official Receiver’s Notice as may be the proper subject of such a claim.  In these circumstances, given the absence of appropriate submissions on the Notice and on the various categories of document sought by the Official Receiver, I will direct that the applicants bring in short minutes of order that give effect to these reasons.

I certify that the preceding thirteen (13) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Finn.

Associate:

Dated:             16 March 1999

Counsel for the Applicant:	Mr C Erskine
Solicitor for the Applicant:	Murrays Lawyers
Solicitor for the Respondent:	Patrick Woods & Company
Date of Hearing:	12 March 1999
Date of Judgment:	16 March 1999