Cox v Glenlogan Park (Stud) Pty Ltd
[2001] QDC 302
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- Unreported Judgment
- Cox v Glenlogan Park (Stud) Pty Ltd[2001] QDC 302
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Cox v Glenlogan Park (Stud) Pty Ltd[2001] QDC 302
Cox v Glenlogan Park (Stud) Pty Ltd[2001] QDC 302
DISTRICT COURT OF QUEENSLAND
CITATION: | Cox v. Glenlogan Park (Stud) Pty Ltd & Ors [2001] QDC 302 |
PARTIES: | VIVIAN HENRY COX (Plaintiff) v. GLENLOGAN PARK (STUD) PTY LTD (First defendant) And TERRY C LOWIS (Second defendant) And GLENLOGAN PARK PTY LTD (Third defendant) And JON MICHAEL HASELER (Fourth defendant) And RELESAH PASTORAL HOLDINGS PTY LTD (Fifth defendant) |
FILE NO/S: | Plaint 4486 of 1998 |
DIVISION: |
|
PROCEEDING: | Application |
ORIGINATING COURT: | District Court Brisbane |
DELIVERED ON: | 30 November 2001 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 8 November 2001 |
JUDGE: | McGill DCJ |
ORDER: | Order the first, third, fourth and fifth defendants disclose to the second defendant, by provision of a copy, the signed statement of the second defendant dated 30 November 1998. Order that the time for filing and service by the second defendant of a defence to the plaintiff’s further amended statement of claim, and the third party proceeding issued against the second defendant by the first, third, fourth and fifth defendants, in accordance with the directions of Her Honour Judge Dick on 12 September 2001 and the rules of court, be extended until 7 days after the date on which that copy is provided to the solicitors for the second defendant. Order the first, third, fourth and fifth defendants to pay the second defendant’s costs of and incidental to the application to be assessed. |
CATCHWORDS: | EVIDENCE – Privilege – Legal Professional – whether applies to documentation of solicitor’s interview with opposite party – whether waived by disclosure of statement for signature – extent of waiver Aydin v. Australian Iron and Steel Pty Ltd [1984] 3 NSWLR 684 – followed Ampolex Ltd v. Perpetual Trustee Co (Canberra) Ltd (1995) 37 NSWLR 405 - cited Australian Competition and Consumer Commission v. Australian Safeway Stores Pty Ltd (1998) 81 FCR 526 – cited Attorney General (NT) v. Maurice (1986) 161 CLR 475 – applied Australian Federal Police v. Propend Finance Pty Ltd (1997) 188 CLR 501 – cited British Coal Corporation v. Dennis Rye Ltd (No. 2) [1998] 1 WLR 1113 – applied Brown v. Guardian Royal Exchange Assurance PLC [1994] 2 Ll.L.Rep. 325 – cited Cia Barca de Panama S.A. v. George Wimpey & Co Ltd [1980] 1 Ll.L.Rep. 598 - distinguished Celic v. Australian Iron and Steel (NSW Supreme Court, Master Allen, 7.6.84, unreported) – cited Farrow Mortgage Services Pty Ltd v. Webb (1996) 39 NSWLR 601 – applied Feuerheerd v. London General Omnibus Co Ltd [1918] 2 KB 565 – not followed Flack v. Pacific Press Ltd (1970) 14 DLR (3d) 334 – cited Goldberg v. Ng (1995) 185 CLR 83 – applied Goldman v. Hesper [1988] 1 WLR 1238 – cited Goodrick v. Nichols (1998) 8 Tas.R. 139 – considered Guinness Peat Properties Ltd v. Fitzroy Robinson Partnership [1987] 1 WLR 1027 – cited Handley v. Baddock [1987] WAR 98 – considered Health and Life Care Ltd v. Price Waterhouse (1997) 69 SASR 362 - distinguished Hills v. Raunio (ACT Supreme Court, Gray J, 28.5.01, unreported) – considered Nickmar PtyLtd v. Preservatrice Skandia Insurance Ltd (1985) 3 NSWLR 44 – not followed Noveski v. Australian Iron and Steel Ltd (NSW Supreme Court, Begg J, 29.11.78, unreported) – cited Reitler v. NZI Insurance Australia (1992) 1 Tas.R. 173 – considered Telebooth Pty Ltd v. Telstra Corporation Ltd [1994] 1 VR 337 – not followed Thomason v. Campbelltown Council (1939) 39 SR(NSW) 347 – cited
Ticina v. Australian Iron and Steel Ltd (NSW Supreme Court, Collins J, 3.12.63, unreported) – cited Tobakin v. Dublin Southern Districts Tramways Co [1905] 2 I.R. 58 – cited TSB Bank PLC v. Robert Irving & Burns [2000] 2 All E.R. 826 – cited Vardas v. South British Insurance Co Ltd [1984] 2 NSWLR 652 - considered |
COUNSEL: | S.A. McLeod for the applicant second defendant P.A. Freeburn for the respondent defendants |
SOLICITORS: | Blake Dawson Waldron for the applicant Bowdens for the respondents |
- [1]This is an application by the second defendant for an order that the other defendants disclose to him a particular document. The other defendants have the document, but claim that it is subject to legal professional privilege and therefore need not be disclosed. The point at issue is a short one, but it is one in respect of which there has been some difference of judicial opinion.
- [2]The document in question is a statement of the second defendant, which was provided by him to the solicitors for the other defendants. He did not retain a copy of the statement. The other defendants have now issued third party proceedings against him, and he wants disclosure of the statement he gave them prior to filing and serving his defence.
The action
- [3]According to a further amended statement of claim filed on behalf of the plaintiff on 1 October 2001, on 11 January 1998 the plaintiff purchased a horse at auction from “Glenlogan Park Stud” at the Magic Millions thoroughbred auction sale. The plaintiff is uncertain as to whether it was the first, third, fourth or fifth defendant who carried on business at the relevant time as “Glenlogan Park Stud”, and from whom he purchased the horse. The horse was offered for sale as a racehorse, and was purchased by him for that purpose. He further alleged that two days before the sale the horse was treated by the second defendant with an intravenous injection of an antibiotic and an analgesic antiinflammatory, and on the day of the sale, prior to the sale, similar treatment was applied, so that at the time when the horse was paraded for inspection, and inspected by the plaintiff for the purpose of determining whether or not to purchase, it was affected by the analgesic and antiinflammatory, and displayed no lameness or other observable feature which would detract from its quality as a future racehorse. The plaintiff alleged however that in fact the horse was permanently lame and as a consequence unfit for racing, and of little or no value. The plaintiff seeks to recover the price of the horse, together with various expenses incurred as a result of the purchase, a total of over $90,000.
- [4]There is a difference in the relief sought between the second defendant and the other defendants; the second defendant has been sued for damages for breach of the Fair Trading Act whereas the other defendants were sued, in the case of the corporate defendants, for damages for breach of the Trade Practices Act, relief under s. 87 and damages for breach of contract, and, in the case of the fourth defendant, damages for breach of the Fair Trading Act, a declaration that the contract for sale had been rescinded, and damages for breach of contract.
- [5]On 4 August 1998 a solicitor acting for the other defendants interviewed the second defendant and took notes with a view to preparing a statement for the second defendant to sign. The other defendants allege and it is not disputed that this was done in response to a threat of litigation from the plaintiff to the other defendants, and for the purpose of assisting the other defendants in the preparation of their defence to that claim. Apparently at that stage it was thought that the only involvement of the second defendant in the proceedings would be as a witness for the other defendants. The plaint was originally filed on 22 October 1998. It is not clear when it was served on the second defendant, but the solicitor prepared the statement and forwarded it to the second defendant on 29 November 1998. At that stage he was not acting as solicitor for the second defendant but only as solicitor for the other defendants in relation to what was then an existing action. The second defendant signed the statement on or about 30 November 1998 and returned it to the solicitor. The other defendants say that the document is a statement of a potential witness brought into existence for the sole purpose of preparing for the legal proceedings and is therefore privileged. Although it has now been held that the appropriate test is the dominant purpose test rather than the sole purpose test, neither party suggested in the present case that there was another relevant purpose. Either test was satisfied in this case.
Second defendant’s argument
- [6]The second defendant does not dispute that the document was originally privileged. He submitted however that at the stage when the statement was prepared and signed, the second defendant and the other defendant were all being sued by the plaintiff, and had a common interest in that litigation, so that if subsequently litigation arose between the parties who had the common interest, neither could claim privilege against the other in respect of the documents which had been the subject of the common privilege earlier. Reference was made to Cia Barca de Panama S.A. v. George Wimpey & Co Ltd [1980] 1 Ll.L.Rep. 598, a decision of the Court of Appeal. In that case Bridge LJ said at p. 615:
“If A and B have a common interest in litigation against C and if at that point there is no dispute between A and B then if subsequently A and B fall out and litigate between themselves, and the litigation against C is relevant to the disputes between A and B, then in the litigation between A and B neither A nor B can claim legal professional privilege for documents which came into existence in relation to the earlier litigation against C”.
This passage was cited with approval in Brown v. Guardian Royal Exchange Assurance PLC [1994] 2 Ll.L.Rep. 325 at 329, and in TSB Bank PLC v. Robert Irving & Burns [2000] 2 All E.R. 826 at 831.
- [7]The key to this is the interest of the two parties in the earlier litigation. The matter was put this way by Stephenson LJ at p. 613-4:
“Have the plaintiffs got such an interest in the proceedings to which the documents relate and of which production is objected to by the defendants on the grounds of confidentiality or legal or professional privilege, that they should be just as much entitled to see them as the defendants themselves? In the ordinary way, of course, a third party cannot possibly claim to have disclosed to him in an action against a second party documents which are relevant to that second party’s claim against somebody else, the first party, or a defence to a claim brought against him by that first party. But if the so called third party is not a total stranger but is a person who has a joint or common interest with the defendants whom he has sued in claims which they have made or which have been made against them in other proceedings, then he is not a stranger to those proceedings and if his interest is sufficient, I would have thought it must follow in fairness and common sense … that he would be entitled to see those documents …”.
- [8]It is apparent from this passage that what matters is not whether the two parties who are now in dispute were both sued by the same party in the earlier litigation, which gave rise to the privilege, but whether the two parties have a sufficiently similar interest in the subject matter of that litigation. His Lordship cited with approval a passage in Phipson on Evidence (12th ed.) p. 246 where various categories of joint interest were identified, that is the interest as between partners, or a trust company and its shareholders, or trustee and cestui que trust, or in some circumstance between lessor and lessee or between husband and wife. Plainly it is not merely the fact that both are sued in the same litigation that gives parties a joint interest.
Joint privilege
- [9]A joint interest, giving rise to a joint privilege[1], can arise in two situations: where there is a joint consultation with a legal advisor by two or more persons, and where there is a consultation by or on behalf of a number of persons jointly interested, for example as partners: Farrow Mortgage Services Pty Ltd v. Webb (1996) 39 NSWLR 601 at 608. That was not the situation here. The second defendant was not sued on the basis that there was any partnership between him and the other defendants, or on the basis that he was a joint owner of a horse that was sold, or any other basis which gave him a joint or the same interest in the horse with the other defendants.
- [10]In my opinion if the solicitor had been acting as solicitor for the second defendant as well as for the other defendants at the time when he took the statement, then the privilege in the statement would be the second defendant’s as much as the other defendants’, but at the time the solicitor was acting only for the other defendants. There was no joint retainer of the solicitors, nor any joint interest in the subject matter of the action, so there was no question of joint interest privilege. Nor was this a case where the solicitors, although retained only by the other defendants, were ,when they took the statement, in fact acting to protect the interests of all defendants, as a result of any agreement or undertaking between the defendants, or between the solicitors and the second defendant.
Common interest privilege
- [11]There is a distinction between joint privilege, where all the persons having the privilege hold it jointly (as will be the case in the situations considered above) and common interest privilege, where the relevant persons had a shared or similar interest but not one which is held by them jointly. Cross on Evidence discusses the issue at para. 25265, where categories of insurer and insured, potential underwriter and insured, and neighbours having a common interest in opposing a proposed development or in complaining of a nuisance are also identified. It is not necessary that the parties have a common solicitor[2]. The neighbours who are all opposed to a particular development or are distressed by a particular nuisance, and the insured and insurer who have a common interest in defeating a claim of a third party, fall into this category. This sort of common interest is not a rigidly defined concept: a mere common interest in the outcome of litigation will be sufficient to enable a party to rely on it: Farrow Mortgage Services Pty Ltd v. Webb (1996) 39 NSWLR 601 at 609. That case contains a useful and authoritative analysis of joint and common interest privilege. It was concerned with the effect of an express waiver by one of the parties and whether that waived privilege of the other parties with whom there had been joint or common interest privilege: pp. 619-20. It did not involve the question of whether a document subject to joint or common interest privilege would be subject to discovery as between those interested if litigation between them arose.
- [12]The effect of a common interest of this kind is twofold: disclosure of a privileged document to a person with a common interest does not result in a general waiver of privilege[3] and documents so disclosed will also become subject to legal professional privilege of the recipient: Farrow Mortgage Services v. Webb (supra) at 608, 612. But common interest privilege apparently applies only to documents so disclosed[4]. I have not found any authority for the proposition that the existence of a common interest means that privilege cannot be claimed for anything as between those parties, as is the case where the privilege is joint.
- [13]Farrow v. Webb discussed the question of whether the possibility of some conflicting interest between the parties if they ended up both being sued would destroy the possibility of common interest privilege. In Ampolex Ltd v. Perpetual Trustee Co (Canberra) Ltd (1995) 37 NSWLR 405, Giles J said at p. 410:
“Two persons interested in a particular question will not have a common interest for the purposes of common interest privilege if their individual interests in the question are selfish and potentially adverse to each other. In such a case there will not be the necessary identity of interest”.
- [14]On the other hand, in Lee v. South West Thames Regional Health Authority [1985] 1 WLR 845, the existence of such a conflict was treated as not being inconsistent with the existence of common interest privilege. The facts in that case were somewhat different from the present; it was as if the second defendant had retained a copy of the statement, and the plaintiff was seeking discovery of that copy from the second defendant: the court held in effect that in such circumstances the second defendant was entitled to refuse production on the ground that the statement was subject to the privilege of the other defendants. Ampolex was apparently approved in Farrow v. Webb, and I should follow that approach.
- [15]When a lawyer acting for a party, in anticipation of litigation against that party, takes a statement from a potential witness, the statement will be subject to legal professional privilege which will be the privilege of the party, not the witness, even if the witness is also made a party to the litigation: Australian Competition and Consumer Commission v. Australian Safeway Stores Pty Ltd (1998) 81 FCR 526 at 562-4. In that case the party taking the statement and the person from whom the statement was taken were not only not common, they were opposed, since the statement was in the nature of an investigation of possible wrongdoing on the part of those parties and the companies the individuals represented. Accordingly it was said that there was no question of common interest privilege.
Analysis
- [16]The position in the present case is that the notes prepared by the solicitor were within the scope of legal professional privilege, and the privilege in my opinion was that of the other defendants. There is nothing to indicate that there was any common interest privilege in respect of those notes between those defendants and the second defendant. The relationship between the second defendant and the other defendants did not fall into any of the categories identified in the cases, nor was it similar to them, and their position in the litigation was potentially adverse. There was no exchanging or sharing of privileged material because of a recognition of similarity of interest; the only document provided, the statement, was disclosed solely for the purpose of preparing the case for the other defendants in the litigation. If a copy of the statement had been retained by the second defendant, it would still be subject to the privilege of the other defendants as against the plaintiff: Lee v. South West Thames RHA (supra); Cole v. Elders Finance & Investment Co Ltd [1993] 2 VR 356; Commonwealth Bank of Australia v. Cooke [2000] 1 Qd.R. 7. There was sufficient interest in common for disclosure of the document to the second defendant not to amount to a waiver of privilege against the plaintiff. But the privilege was and remains that of the other defendants only. In my opinion, the principle in Cia Barca de Panama v. George Wimpey (supra) applies only to a situation where, prior to A and B falling out, the privilege in the documents is held by both of them, either jointly or as common interest privilege[5]. That was not the situation here.
- [17]The fact that a witness statement is shown to the witness would not ordinarily mean that privilege in the witness statement would be lost as against a third party (such as the plaintiff for example), particularly in circumstances such as this where the witness, at the time when the statement was signed, was also being sued by the plaintiff. There would be sufficient common interest between the second defendant and the other defendants for the disclosure of the statement by their solicitors to the second defendant not to amount to a waiver of their legal professional privilege in the statement as against the plaintiff. In my opinion, the real question in the present case is whether the privilege was waived as against the second defendant by disclosing the statement, when it was sent for signature.
Feuerheerd v. London General Omnibus
- [18]There is a line of authorities which specifically consider this question, starting with the decision of the Court of Appeal in England in Feuerheerd v. London General Omnibus Co Ltd [1918] 2 KB 565. The facts of that case were somewhat unusual: the plaintiff was injured while she was travelling with her sister-in-law in a taxi as a result of a collision between the taxi and a bus belonging to the defendant. Ultimately she sued the defendant for damages for negligence in respect of her injuries, but before the proceedings had commenced she arranged to meet a representative of her solicitors at the home of her sister-in-law for the purpose of providing a statement. However, the defendant must have been aware of the proposed claim, and its claims inspector went to see the sister-in-law, and was talking to her and taking down details of her account when the plaintiff arrived. She provided him with a statement under the impression that he was the representative of her solicitors. The statement was written up by him, and signed by the plaintiff.
- [19]The statement was held to be privileged from discovery as against the plaintiff. It was found that there was no deceit on the part of the claims inspector in obtaining the statement, and the decision turned on the question of whether the document fell within the ordinary rules of legal professional privilege, which it plainly did. There was no express consideration[6] of whether the privilege had been waived as against the plaintiff by disclosing the document to her (in the course of the process of obtaining her signature to it) although Scrutton LJ at p. 572, after noting that if the plaintiff had not signed the document there would be no question of the plaintiff’s having any right to see it, said he did not understand how the fact that the plaintiff signed the paper gave the plaintiff “an interest in the paper”. Their Lordships declined to follow a decision to the contrary of the Court of Appeal of Ireland: Tobakin v. Dublin Southern Districts Tramways Co [1905] 2 I.R. 58.
- [20]The decision in Feuerheerd has been the subject of some academic criticism, including in Cross on Evidence at para. 25,255. It has however generally been followed in Australia[7], although not always[8]. The only appellate decision in Australia is that of the Full Court of South Australia in Health and Life Care Ltd v. Price Waterhouse (1997) 69 SASR 362, where the court unanimously followed the decision, and held that the statement prepared by a solicitor acting for a party to litigation, for the purpose of that litigation, from a potential witness was subject to legal professional privilege and not liable to be disclosed in later litigation in which that party and the potential witness were opposite parties, in respect of which the statement would have been relevant. The facts are therefore similar to those in the present case, with the significant distinction that there the statement prepared by the solicitor had not been shown to or signed by the potential witness.
- [21]In that case it was argued that the communication between the solicitor and the potential witness was not confidential as against the potential witness, so that there was no confidentiality to safeguard. The information in the statement had come from the potential witness, so that it could not be confidential, and confidentiality was the key to legal professional privilege. Their Honours however drew a distinction between the communication between a potential witness and the solicitor and the document prepared by the solicitor on the basis of that communication; the former may have been confidential for the purposes of the legal advisor (and his client) but would ordinarily not be confidential so far as the third party was concerned, so that the third party would usually be at liberty to pass on the communication as he pleased: see p. 370. However, the document prepared by the solicitor evidencing that communication would be subject to legal professional privilege of the client if it satisfied the other criteria required to raise a claim, that is if it was a document prepared by the solicitor when litigation was anticipated or commenced for the purposes of litigation.
- [22]Lander J, with whom the other members of the court agreed generally, said at p. 370:
“Any statement which the legal advisor prepares for the sole purpose of contemplated or pending legal proceedings, whether or not the communication giving rise to the preparation of the statement was confidential in the sense that I have explained a confidential communication between a legal advisor and a third party, will be privileged. It does not matter whether that statement was prepared as a consequence of a confidential communication from the client to the client’s legal advisor or as a result of a communication from a third party to the legal advisor”.
- [23]It follows that on this approach the notes taken by the solicitor of the interview with the second defendant would be privileged, and the statement prepared by the solicitor was privileged, at least initially. The court in Health and Life did not expressly decide what the situation would be if the statement had then been shown to and signed by the potential witness, although two members of the court expressed the view that the outcome in such a situation did not turn on the fact that the information in the statement came from the party seeking production: p. 372 per Bleby J. That in my opinion necessarily follows from the point that was decided by the court. His Honour went on to say:
“It will depend on the proper application of the purposes for which the communication is made. In some cases … it may not have been produced solely for the purpose of litigation”.
- [24]That case was decided prior to the adoption by the High Court of the dominant purpose test rather than the sole purpose test[9]. Their Honours expressed the view that their approach was consistent with and supported by the decision of the High Court in Australian Federal Police v. Propend Finance Pty Ltd (1997) 188 CLR 501. If one assumes that the communication from the witness to the solicitor (ie the oral communication) was not privileged then even if the statement prepared by the solicitor on the basis that communication was a verbatim copy of the oral unprivileged communication, it would still be a “copy” prepared for the purposes of litigation and therefore, according to Propend, within the privilege.
Cases where Feuerheerd not followed
- [25]In Aydin v. Australian Iron and Steel Pty Ltd [1984] 3 NSWLR 684, Hodgson J held that a statement, obtained from the plaintiff (who was employed by the defendant) by an accident investigator employed by the defendant after the accident but before litigation, was not brought into existence for the sole purpose of submission to the defendant’s solicitor in the event of litigation, and accordingly legal professional privilege did not attach to it at all. The rest of what His Honour said was really obiter, but he went on to accept a submission on behalf of the plaintiff that the statement (once it had been signed) was a communication between the plaintiff and the defendant which was therefore not confidential as against the plaintiff. He also expressed the view that production of the statement of the plaintiff amounted to a waiver of any privilege which might otherwise exist. His Honour however in that case distinguished cases where such statements were obtained by the solicitor rather than by the client. After considering the various authorities where Feuerheerd was followed or criticised, he declined to follow it on the ground that the signed statement was a communication by the plaintiff to the defendant which was not confidential, but ultimately did not express a concluded opinion on the issue of waiver.
- [26]In Telebooth Pty Ltd v. Telstra Corporation Ltd [1994] 1 VR 337, it was held that a tape recording of a non-confidential conversation between opposing parties to litigation subsequently commenced and in contemplation at the time of the conversation, made for the sole purpose of providing to solicitors to obtain legal advice and for use in any such proceedings, and the transcript of that tape recording, were not subject to legal professional privilege, on the ground that they were not confidential because the conversation the subject of the tape recording was not confidential. Feuerheerd was not followed, and indeed was said to be wrong, and reference was made to criticisms of it and some later cases which declined to follow it. This decision is of no assistance in the present case. There was no question of waiver and there was no distinction drawn between the confidentiality or otherwise of the conversation, and the confidentiality or otherwise of the documentation of that conversation for the purpose of providing that documentation to the solicitor. In my opinion, the reasoning in this case is inconsistent with the reasoning in Health and Life Care Ltd (supra), and I regard the latter as clearly preferable and more persuasive.
- [27]In Goodrick v. Nichols (1998) 8 Tas.R. 139, a situation similar to that in Aydin was considered by Wright J, and he came to the same conclusion, although he went further and expressly concluded that there had been waiver in that case. It seems to me that His Honour found the reasoning in Aydin persuasive.
Cases where Feuerheerd followed
- [28]Turning to the cases where Feuerheerd has been followed, in Vardas v. South British Insurance Co Ltd [1984] 2 NSWLR 652, it was followed in relation to a statement obtained from the plaintiff by a loss assessor investigating a claim on an insurance policy by the plaintiff, at a time when he had decided that the claim should be rejected and was gathering evidence to submit to the solicitors. Clarke J held that this decision compelled him to uphold the claim for privilege, although he commented that the decision was “difficult to accommodate … with the rationale underlying the rules of legal professional privilege as explained in Grant [v. Downs (1976) 135 CLR 674]”. In Nickmar Pty Ltd v. Preservatrice Skandia Insurance Ltd (1985) 3 NSWLR 44, Wood J considered but declined to follow Aydin (supra), and held that statements obtained from the opposite party for the sole purpose of use in connection with litigation were privileged, on the basis that the weight of authority seemed to favour following the decision notwithstanding his reservations as to its correctness. It appears from the discussion in Aydin (supra) at p. 690 that the judges who decided the two earlier unreported decisions where Feuerheerd was followed also decided with some doubt as to the correctness of the decision, although they felt it right to follow it as a decision on the point of the Court of Appeal.
- [29]In Handley v. Baddock [1987] WAR 98, Master Seaman QC followed Feuerheerd in a case involving a solicitor’s note of a conversation with the other party to proposed litigation, where the note was made solely for the purpose of the proposed litigation, and held the note was privileged; he anticipated the distinction drawn in Health and Life Care Ltd (supra) between the communication and the document recording communication. That case did not involve a statement submitted to and signed by the other party. The same distinction was drawn by Zeeman J in Reitler v. NZI Insurance Australia (1992) 1 Tas.R. 173 where he held that the notes of an investigator, retained by solicitors for a defendant in contemplation of litigation, of his interview with the plaintiff were subject to legal professional privilege. Nevertheless, he expressed the view that it may well be that Feuerheerd was wrongly decided: p.180.
- [30]The most recent case I have been referred to where Feuerheerd was followed is Hills v. Raunio (ACT Supreme Court, Gray J, 28.5.01, unreported) where the dispute was as to the notes of the interview with the other party. The statement prepared on the basis of the notes and forwarded to the other party for signing, and signed, had already been provided to the other party. It was accepted there had been a waiver of any privilege in the statement, and it was submitted that this had the effect of also waiving privilege in respect of the earlier notes on which the statement was supposed to be based, but that argument was rejected and the notes were held to be privileged. All of these cases either involved a distinction between documents disclosed and not disclosed, or contained a comment at least doubting Feuerheerd.
Waiver by disclosure
- [31]There is no doubt that a litigant can waive privilege directly through intentionally disclosing protected material: Attorney General (NT) v. Maurice (1986) 161 CLR 475 at 487; Goldberg v. Ng (1995) 185 CLR 83 at 106. This has given rise to difficulties in a number of cases where there has been an inadvertent disclosure, such as disclosure by mistake in the course of making discovery of documents which could have been the subject of a claim of privilege and ought to have been. In Guinness Peat Properties Ltd v. Fitzroy Robinson Partnership [1987] 1 WLR 1027, a letter which had been disclosed inadvertently, and of which the other party had taken a copy, was held still subject to the privilege and an injunction granted requiring all copies to be returned. Slade LJ with whom the other members of the court agreed, said at p. 1043:
“A mere plea of inadvertence does not by itself necessarily enable a party to litigation to avoid a loss of privilege. Privilege may be lost by inadvertence.”
A similar result followed in Hooker Corporation Ltd v. Darling Harbour Authority (1987) 9 NSWLR 538, and Key International Drilling Co Ltd v. TNT Bulkships Operations Pty Ltd [1989] WAR 280, although in Kabwand Pty Ltd v. National Australia Bank Limited (1987) 16 FCR 85, Pincus J held there had been waiver as a result of an inadvertent disclosure on inspection to the extent that knowledge had been acquired of privileged documents by the other party, but refused to order that copies of the documents be provided, as waiver had not been complete. For present purposes the significance of these cases is the assumption that disclosure to the opposite party ordinarily will result in a waiver of privilege.
- [32]The reason why this is of significance is that commonly the situation which is considered by a court is whether disclosure by A to B of documents which are the subject of A’s legal professional privilege has resulted in a waiver so that the privilege is gone, thereby making the documents discoverable to C. The ordinary rule is that that will be the case, although there are various recognised categories of exception. The position was conveniently summarised by Toohey J in his dissenting judgment in Goldberg v. Ng (supra) at p. 106:
“A litigant may waive the privilege by intentionally disclosing protected material to another. If disclosure is incompatible with the retention of confidentiality, there will ordinarily be a general waiver of privilege. It is therefore necessary to consider the circumstances in which disclosure is made. Legal professional privilege extends to documents exchanged between parties with a common interest in the litigation. Therefore disclosure of otherwise privileged documents to a party with a common interest in litigation does not constitute a waiver. Disclosure to a third party, such as a doctor, for the purpose of obtaining an expert report to be used in litigation does not constitute a waiver. Nor does disclosure to an associate or confidant unconnected with the proceedings. On the other hand, disclosure to an agent of an opposing party does amount to waiver.”
In that case it was held by the majority that voluntary disclosure of the documents to the Law Society in the course of the Society’s investigation of a complaint by the other party to the litigation waived the privilege as against the other party to the litigation.
Limited waiver
- [33]The majority in Goldberg v. Ng at p. 95 referred with apparent approval to the possibility of a limited waiver, that is something other than the sort of general waiver which they held had been effected by the conduct in that case. That seems to me to be an endorsement by the High Court there can be such a thing as limited waiver. One of the decisions referred to was British Coal Corporation v. Dennis Rye Ltd (No. 2) [1988] 1 WLR 1113, where it was held that voluntary disclosure of certain documents to the police for the purpose of criminal investigation did not amount to a waiver in favour of the other party to civil litigation. That was characterised by Taylor LJ (with whom the other members of the court agreed) in Goldman v. Hesper [1988] 1 WLR 1238 at 1245 as involving the question of “whether the waiver of privilege in favour of the police amounted to a waiver in favour of the defendant for the purposes of the proceeding”.
- [34]In that case it was held that there could be a waiver for a limited purpose: the disclosure of privileged documents in the course of taxation for the purposes of the taxation did not effect a waiver for any other purpose, even as against the other party to the taxation. In that case the other party sought wider disclosure of privileged documents for the purpose of taxation, and it was held that the taxing officer had not erred in refusing that course. Reference was also made by the High Court to the judgment of Jordan CJ in Thomason v. Campbelltown Council (1939) 39 SR(NSW) 347 at 355, where there appears to be some acceptance that there can be a limited waiver. The position in Goldberg v. Ng was confirmed by the majority in Mann v. Carnell (1999) 201 CLR 1 at 14[10].
- [35]Disclosure of a draft proof of a witness, or indeed a final proof of a witness, to the witness for the purpose of having the witness check the draft, or to make the witness aware of what statement has been given, has been held not to effect the general waiver of privilege in the statement, even if a copy of the statement is provided to the witness to keep: Commonwealth Bank of Australia v. Cooke [2000] 1 Qd.R. 7, a case dealing with a copy of an affidavit provided to a witness in respect of which privilege was held not to have been waived, where a number of earlier authorities to similar effect are collected. In my opinion, it is clear that nothing that the other defendants have done amounts to a waiver of their privilege in the statement generally, so that it is still privileged as against the plaintiff. But the authorities to which I have referred indicate there can be a limited waiver, as against the person to whom the disclosure is made, without effecting a general waiver.
Analysis
- [36]This is the essential difficulty that I have with the reasoning in Feuerheerd: when the statement prepared by the accident investigator was provided to the plaintiff for her to read through, presumably to correct, and then to sign, there was a deliberate disclosure to her of what had until then been a privileged document. Accepting that the disclosure was for the purposes of the litigation, so that the purpose aspect of the test for legal professional privilege was satisfied, it was not then a communication confidential as against the plaintiff, and it was a voluntary disclosure of that document to her. I cannot see therefore why it does not amount to a waiver of privilege as against her. Given that she was an adverse party to the proposed litigation, in Feuerheerd there would not be much point in privilege surviving at all from that point on, so that the case would be one of general waiver rather than limited waiver.
- [37]Approaching the matter in the way adopted by the High Court in Goldberg v. Ng (supra), once the draft statement had been shown to the plaintiff for the purpose of obtaining the plaintiff’s confirmation of it and acceptance of it, which was acknowledged by her signature to it, it was thereafter unfair to permit reliance by the defendant on its legal professional privilege to prevent disclosure of the document to the plaintiff. This is not something which turns on whether the plaintiff had some interest in the document in the proprietary sense, but on the fact that the plaintiff’s adoption of the document as recording a particular version makes it unfair thereafter for that version not to be available to her. Treating this as express waiver is therefore consistent with the approach now adopted by the High Court in relation to the test of imputed waiver, but in my opinion this is not really a case of imputed waiver, because voluntary disclosure is ordinarily treated as a form of express waiver. Disclosing the document in these circumstances is also in no way inconsistent with the important public interest which justifies the rules of legal professional privilege[11].
- [38]In my opinion what happened here is that when the draft statement was provided to the second defendant for his consideration and adoption by signature, there was an express waiver, but only as against him, of the legal professional privilege of the other defendants in respect of that document (but only that document: not the other documents prepared by the solicitor which were not so disclosed).
- [39]That, in my opinion, is entirely consistent with what was actually decided in Health and Life Care Ltd (supra), a decision which I would regard as being a strong persuasive authority anyway, and with which respectfully I entirely agree. That decision was really concerned with putting to rest a false argument raised as a basis for seeking to overturn the decision in Feuerheerd[12]. It is also consistent with that part of the reasoning in Aydin (supra) that dealt with the question of waiver by disclosure of the statement when it was signed and is also consistent with the approach in Goodrick (supra).
- [40]In my opinion the decision in Feuerheerd is inconsistent with later Australian authority on the waiver of privilege, and really cannot stand with the clear statements in those recent Australian cases[13] as to the significance in the ordinary case of voluntarily disclosure of privileged material. Indeed, it seems to me to be difficult to reconcile with the decision in Minter v. Priest [1930] AC 558, where a statement defamatory of the plaintiff was made by a solicitor to his client in the course of a consultation, and subsequently reported by the client to the plaintiff. He sued the solicitor for defamation, and called the client to prove publication. The matter was complicated by the question of whether the privilege was really a joint privilege which had not been waived by the other joint holder, but there was general acceptance that had it been the single privilege of the disclosing client, that privilege was waived by disclosure.
- [41]In my opinion, therefore, the other defendants cannot as against the second defendant assert legal professional privilege in respect of the statement signed by the second defendant. No submissions were advanced on behalf of those defendants that, if I reached this conclusion, it was not appropriate to make the orders sought by the second defendant. I therefore order that the first, third, fourth and fifth defendants disclose to the second defendant, by provision of a copy, the signed statement of the second defendant dated 30 November 1998. I also order that the time for filing and service by the second defendant of a defence to the plaintiff’s further amended statement of claim, and the third party proceeding issued against the second defendant by the first, third, fourth and fifth defendants, in accordance with the directions of Her Honour Judge Dick on 12 September 2001 and the rules of court, be extended until 7 days after the date on which that copy is provided to the solicitors for the second defendant. I order the first, third, fourth and fifth defendants to pay the second defendant’s costs of and incidental to the application to be assessed.
Footnotes
[1] If the privilege is held jointly, it cannot be claimed as between the joint holders: Re Konigsberg [1989] 1 WLR 1257 at 1265-6.
[2] Nor that they have sufficiently similar interests that they could have used the same solicitor: Network Ten Ltd v. Capital Television Holdings Ltd (1995) 36 NSWLR 275 at 280, 282.
[3] Although it is not only where there is a common interest that this will be the case: Network Ten Ltd (supra) where there was no common interest but no waiver by disclosure.
[4] See Network Ten (supra) at p.279 where Giles J speaks of “documents containing that information”, i.e. information exchanged.
[5] Both Cia Barta de Panama and TSB Bank were cases of joint interest privilege.
[6] The judgment was ex tempore
[7] Followed in: Ticina v. Australian Iron and Steel Ltd (NSW Supreme Court, Collins J, 3.12.63, unreported); Noveski v. Australian Iron and Steel Ltd (NSW Supreme Court, Begg J, 29.11.78, unreported); Vardas v. South British Insurance Co Ltd [1984] 2 NSWLR 652; Nickmar Pty Ltd v. Preservatrice Skandia Insurance Co Ltd (1985) 3 NSWLR 44; Handley v. Baddock [1987] WAR 98; Reitler v. NZI Insurance Australia (1992) 1 Tas.R. 173; Health and Life Care Ltd v. Price Waterhouse (1997) 69 SASR 362; Hills v. Raunio (ACT Supreme Court, Gray J, 28.5.01, unreported)
[8] Not followed in : Celic v. Australian Iron and Steel Australia Ltd (NSW Supreme Court, Master Allen, 7.6.84, unreported); Aydin v. Australian Iron and Steel Ltd [1984] 3 NSWLR 684; Telebooth Pty Ltd v. Telstra Corporation Ltd [1994] 1 VR 337; Goodrick v. Nichols (1998) 8 Tas.R. 139. It has also not been followed in Canada: Flack v. Pacific Press Ltd (1970) 14 DLR (3d) 334.
[9] In Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49.
[10] Notwithstanding the vigorous dissent of McHugh J, who would hold the privilege waived by any voluntary disclosure to anyone other than the client and the lawyer (p.42), a sweeping change from the position as expounded , for example, by Toohey J in Goldberg at p.106, and in most of the cases discussed in this judgment: p.42.
[11] See for example Baker v. Campbell (1983) 153 CLR 52 at 95, 118-9.
[12] Apparently first raised by Sir Edward Bray in a note in the 1920 Annual Practice at p.498, quoted in Telebooth v. Telstra (supra) at p.344.
[13] To Maurice and Goldberg may be added Mann v. Carnell (1999) 201 CLR 1 at 13.