Bardley-Smith & Ors v Penrith City Council & Anor

20 Documents 6 and 7 of Schedule 2 are the e-mail from CPS to the second respondent at 10:26am on 31 March 2009 and the e-mail from the second respondent to CPS at 11:56am on the same day respectively. The applicants firstly submit that these emails are not protected by client legal privilege on the basis that they are not communications between a lawyer and a client. Secondly, it is submitted that the emails are communications for the purpose of finalising the submission to the Council and can therefore not be properly characterised as having a dominant purpose for the provision of legal advice. Further, the applicants submit that these e-mails do not disclose privileged communications. This submission is made firstly on the basis that, as submitted, the e-mail from Pikes Lawyers to CPS is not privileged. Secondly, the applicant says that the e-mails are voluntary third party communications and therefore any disclosure of legal advice therein constitutes an act inconsistent with the maintenance of a claim for privilege pursuant to s 122(2).

21 It is important to understand that s 118 does not apply exclusively to documents that are confidential communications made for the dominant purpose of the provision of legal advice. Similarly, s 119 does not apply exclusively to documents that are confidential communications made for the dominant purpose of the client being provided with professional legal services relating to an Australian proceeding. Rather, each of sections 118-119 apply to documents that, if admitted, would "result in disclosure of" confidential communications made for that dominant purpose. Therefore, it is my view that if there is a communication that can be properly described as "a confidential communication made between the client and the lawyer… for the dominant purpose of… legal advice" pursuant to s 118, then any document containing the contents of that communication would be subject to privilege. Similar reasoning applies to s 119.

22 Of course, the communication that would be disclosed pursuant to s 118 must be one that is "between the client and the lawyer". As outlined earlier, a communication with a client includes a communication with an employee or agent of a client. Section 119 is broader, but nonetheless requires that the communication that would be disclosed is one between "the client" and another person.

23 Dealing first with s 118, I am satisfied that Document 5 of Schedule 2, the e-mail from Pikes Lawyers to David Ryan of CPS on 30 March 2009, is a confidential communication for the purpose of providing legal advice. That legal advice is clearly articulated by reading the attachment together with the e-mail of Joshua Palmer itself. I cannot accept the applicants' submission that, by virtue of the communication being given for the purpose of finalising a submission to the Council, the dominant purpose is not for the provision of legal advice. Such an approach is misleading. Pikes Lawyers are planning lawyers who were retained and provided advice in relation to what should be contained within a submission to the Council. Whilst the purpose of the correspondence was to finalise the submission, the dominant purpose of conversing with Pikes Lawyers in relation to the submission was to receive their legal advice in relation to what should be contained therein.

24 However, whether the dominant purpose of the e-mail is to provide "legal advice to the client" is a separate and more difficult question. In order to be so satisfied, I must be able to firstly identify the person "who engages a lawyer to provide legal services" pursuant to the definition of client in s 117(1)(a). I must then be satisfied that: The second respondent is that person or an agent of that person such that it is entitled to claim privilege; That CPS, the recipient of the email, is an agent of that person such that the communication is between "the client and the lawyer" and is "legal advice to the client". 25 Strictly speaking, Pikes Lawyers were retained by My Chemist Pty Ltd. This is evident from the submission provided to the Council by Pikes Lawyers on behalf of My Chemist Pty Ltd. Similarly, the evidence is that My Chemist Pty Ltd has an agreement with AMS for the provision of administrative services. AMS then retained CPS and Restifa & Partners Pty Ltd to assist it in obtaining development consent. However, the evidence also shows that the consultancy services provided by CPS were by agreement directly with My Chemist Pty Ltd. There is no such evidence in relation to Restifa & Partners. It therefore follows that each of Pikes Lawyers, AMS and CPS are agents of My Chemist Pty Ltd. In practice, however, the agency of CPS was exercised by receiving instructions from AMS.

26 Further, I cannot accept that the case law limits the scope of the agency in the manner submitted by the applicants. Whilst the fee proposal did not contain a specific agreement for CPS to obtain legal advice on behalf of AMS, such an agreement came about through the role of CPS. CPS was engaged for the assistance in relation to obtaining development consent. The application for development consent may, at some point, necessitate the engaging of a lawyer for legal advice. Further, the discussion between CPS and AMS subsequent to the granting of the development approval, articulated in Documents 1 and 2 of Schedule 2, clearly establish that AMS specifically requested CPS to obtain advice from a planning lawyer with respect to modifying or deleting condition 4. I am therefore satisfied that CPS is an agent of the person who engaged the solicitor, and that by the nature of the arrangement the second respondent is entitled to claim privilege over communications between CPS and the lawyer.

27 As a result, I cannot accept that a disclosure to CPS is a third party communication inconsistent with maintaining a claim for privilege pursuant to s 122(2). In my view, the nature of the arrangements between My Chemist Pty Ltd and their various agents, precludes CPS from being described as "another person" within the meaning of s 122(3)(a). Further, the final submission to the Council does not disclose the legal advice contained within Document 5 and therefore cannot be said to be a waiver of the confidential communication from Pikes Lawyers to CPS. Therefore, I find that the privilege claim over Document 5 is well founded.

28 Document 7 of Schedule 2, the e-mail from AMS to CPS dated 31 March 2009, discloses the content of the legal advice contained in the e-mail from Pikes Lawyers. Accordingly, pursuant to s 118, I find that in relation to that document the privilege claim is made out.

29 However, there is no such disclosure of legal advice contained in the e-mail from CPS to AMS dated 31 March 2009, other than by way of the forwarding of the e-mail from Pikes Lawyers. I am not satisfied that the e-mail itself, Document 6 of Schedule 2, is subject to privilege.

30 Document 3 of Schedule 2, the e-mail from CPS to AMS dated 24 March 2009, discloses the legal advice referred to above, notwithstanding that it precedes the e-mail of Pikes Lawyers dated 30 March 2009. One can then assume that there has been a prior confidential communication for the dominant purpose of the provision of legal advice to AMS, about which there is some discussion and following which there is the e-mail communication of 5 March 2009. Given that there has been no disclosure of the nature of this advice to the Council or to another party, I similarly find that there has been no waiver and the claim for privilege is well founded.

31 Document 4 of Schedule 2, the e-mail from AMS to CPS, contains instructions given by the second respondent in relation to the submission to be given to the Council following the legal advice. However, the e-mail does not disclose the advice given by Pikes Lawyers. It therefore does not disclose any communication given for dominant purpose of legal advice. As a result, I cannot accept that this document is privileged.

32 Dealing then with Document 1 of Schedule 2, I am satisfied that pursuant to s 119 this is a confidential communication between AMS and CPS prepared for the dominant purpose of the client, AMS, being provided with legal services in relation to anticipated proceedings. The discussion within that e-mail communication includes a number of comments in relation to proceedings being commenced in this Court, and in relation to obtaining legal advice in that respect. I am therefore satisfied that this e-mail is subject to privilege.

33 The response by AMS to this e-mail is contained in the e-mail dated 5 March 2009 and is Document 2 of Schedule 2. I am also satisfied that this e-mail is a confidential communication between the second respondent and CPS in relation to AMS being provided with legal services. However, the substance of the communication is for the dominant purpose of legal services provided for a submission to be made to the Council, rather than for anticipated court proceedings. Accordingly, Document 2 does not fall within s 119 and therefore I cannot accept that the claim for privilege is well founded.

34 In my view, access should be granted to the documents for which I have not upheld the claim for privilege. However, access to the documents in their current form would then allow the applicants to view the material in relation to which I have upheld the claim for privilege. Accordingly, the following orders are appropriate:

1. That the privilege claim in relation to Documents 1 and 3 of Schedule 1, and Documents 1, 3, 5 and 7 of Schedule 2 is upheld; 2. That access be granted to Document 2 of Schedule 1, and Document 2, 4 and 6 of Schedule 2; 3. That the second respondent facilitate order 2 by providing to the court, within 7 days, separate copies of the e-mails specified therein.

35 The applicants also seek leave to file and serve an Amended Summons and Amended Points of Claim. The amendments to the Summons propose additional declaratory and injunctive relief. That relief concerns the alleged use of the premises by the second respondent as a "shop". The proposed amendments to the Points of Claim set out the facts relied upon to establish that the premises has been used as a shop by the second respondent.

36 By the same notice of motion, the applicants seek discovery of a number of categories of documents. Specifically, the category (a) concerns internal feasibility studies in relation to the business "which estimate the predicted sales volumes by source". Category (b) seeks documents estimating the project sales and income. Categories (c) and (d) seek records of sales made in similar businesses in NSW. Category (e) seeks correspondence between the second respondent and the managing agent or manager of the SupaCenta concerning the business.

37 The affidavit of Mr Rotstein affirmed 7 October 2009, read by the second respondent at the hearing of the notice of motion, sets out that AMS does not own or operate the businesses that trade as the "Chemist Warehouse", including the business the subject of these proceedings. Further, that affidavit indicates that AMS does not have any documents falling within categories (a) and (b) of the proposed orders for discovery. The affidavit was served on the applicants at 3pm on the day prior to the hearing of the notice of motion. 38 The Council does not oppose leave being granted for the filing of the Amended Summons and Points of Claim, and neither opposes nor consents to the orders being made for discovery.

39 The applicants submit that leave ought to be granted for the amendments to be made in order to ensure that the issue in relation to the use of the premises is before the Court. The applicants also submit that discovery is necessary in order to ensure that all the material relevant to the issue of use is available to the Court for its determination of the proper characterisation of the use of the premises. The applicants rely on the affidavit of Ms Woodward-Brown sworn 1 October 2009, which sets out that the applicants' expert requires the projected sales figures in order to prepare his evidence in chief. 40 The applicants submit that the order for discovery is an appropriate means by which the second respondent can identify relevant documents that are within their possession and control, and can disclose the location of relevant documents that were in their possession. The applicants submit that the documents sought are relevant to the issue of the characterisation of the use of the premises, and that the documents would assist the applicants in preparing their evidence in chief. It is submitted that the characterisation of the actual use of the premises is relevant to the issue of the validity of the consent granted. The applicants also submit that the reference to other outlets in the Statement of Environmental Effects is relevant to an analysis of whether the use of the subject premises as a retail facility can be properly characterised as an ancillary use. Further, the applicants seek an additional order requiring the second respondent to obtain the documents from third parties in order to comply with the order for discovery. It is submitted that in the circumstances such an order is appropriate. The Court has power to make the order pursuant to s 23 of the Land and Environment Court Act 1979.

41 In relation to the proposed amendments to the pleadings, the second respondent submits firstly that the assertion that the premises are presently used as a "shop" is not relevant to the validity of the consent. In that respect the second respondent refers me to the decision of Lloyd J in Westfield Management Pty Limited & Anor v Gazcorp Pty Limited & (2) Ors [2004] NSWLEC 7, where at paragraph 4 his honour states that: "The parties have tendered four lever arch files of documentary material. The lawfulness of the consent and of the present use may be resolved, however, by reference to only two documents, the relevant environmental planning instrument and the development consent." 42 Secondly, the second respondent submits that it is inappropriate and futile for injunctive relief to be sought against a party who does not operate or control the premises. The second respondent says that it is the applicants' role to find out who is operating the premises and join that person as a party to the proceedings. 43 In relation to the order sought for discovery, the second respondent submits firstly that the documents sought cannot be relevant to the validity of the development consent. Again, the second respondent says that the validity of the consent can be determined only by reference to what was before the Council at the time of the granting of the consent. Secondly, the second respondent has drawn my attention to paragraph 15 of the Practice Note - Class 4 Proceedings. That paragraph states that for judicial review proceedings, orders "for formal discovery and interrogatories will only be made in exceptional cases". The second respondent submits that there are no exceptional circumstances in these proceedings. Thirdly, the second respondent submits that the application for an order for discovery is premature. It is submitted that discovery should be ordered only where the issues are defined on the pleadings, and to do so prior to that time is to allow a fishing expedition. In relation to the additional order sought by the applicants, the second respondent submits that there is no evidence that AMS can obtain the documents from the third parties specified therein. Finally, the second respondent submits that it is not appropriate for the Court to make an order for discovery where there is evidence that AMS is not the appropriate party to provide such documents and where none of the material is relevant to the applicants' claim against the second respondent. 44 In their submissions in response, the applicants say that notwithstanding that the proper party is not joined to the proceedings, the Court ought to grant leave to amend the pleadings in order to facilitate the just, quick and cheap conduct of the proceedings. The applicants also submit that paragraph 15 of the Practice Note relates only to judicial review proceedings and not to proceedings in which actual use is being challenged. The applicants also submitted that it is not efficient to await the closing of the pleadings to make an order for discovery.

45 The court has a general discretion to grant leave to a party to make amendments to documents. Leave may be granted for an amendment to be made to pleadings in circumstances where such an amendment will allow all the issues in dispute to be brought before the court and in order to avoid multiplicity of proceedings. However, proposed amendments should not be granted at the expense of the efficient conduct of the proceedings. Further, leave ought not to be granted for amendments to pleadings where the proposed amendments are futile or inadequately particularised.

46 The proposed amendments to the pleadings create a fresh claim in the nature of civil enforcement proceedings preventing the operation of the premises. The amendments are sought early in the proceedings and will achieve the aim of avoiding a multiplicity of proceedings. However, the evidence demonstrates that the second respondent does not own or operate the premises the subject of the proceedings. An amendment to the pleadings that will seek injunctive and declaratory relief against the second defendant in relation to that use would therefore be futile. I cannot accept the submission of the applicants that I ought to grant leave for the filing of the amended pleadings absent from the relevant party being joined to the proceedings. Leave ought only be granted to amended pleadings in circumstances where the proposed amendment clearly particularises the relief sought, and where the proper party against whom the relief is sought is a party to the proceedings.

47 Given that I am not prepared to grant leave to amend the Summons and the Points of Claim, I cannot accept that it is appropriate for me to order discovery in accordance with prayer 2 of the notice of motion. Part 21 Rule 2 of the Uniform Civil Procedure Rules 2005 provides that the court may only make an order for discovery where the documents would be "relevant to a fact in issue". The facts in issue in a particular proceeding are determined by the facts in dispute in the pleadings.

48 The second respondent submits that to obtain discovery early in the proceedings is an exercise in 'fishing'. Generally such a submission is true. Where the pleadings are not closed, there is no way of identifying the facts in issue. However, in many proceedings it will not be necessary for the pleadings to be closed in order to ascertain the facts in issue. 49 The present proceedings challenge the consent granted by the Council. The facts in issue concern the validity or otherwise of the consent, based on the characterisation of the use of the premises. In proceedings challenging the validity of the consent, I accept the submission of the second respondent that the characterisation must be based on what was before the Council at the time of the granting of the consent. In that respect, I cannot accept the submission of the applicants that these proceedings fall outside the usual judicial review proceedings because they involve a challenge to the development consent based on the actual use of the premises. Evidence of the actual use of the premises subsequent to the granting of consent cannot be relevant to a judicial review of the consent itself.

50 The categories for discovery are therefore not relevant to the facts in issue as they currently stand. Categories (a) and (b) relate to feasibility studies, business projections and estimates of projected sales and income. Such documents cannot be relevant to the validity of the consent unless the documents were considered by the Council in order to characterise the use for which development consent was sought. There is no such evidence of the same. I therefore cannot accept that it is appropriate for these documents to be obtained in order to characterise the use of the premises for which consent was granted. 51 Categories (c) and (d) relates to sales made by similar businesses. Again, these categories are not relevant to the question of the validity of the consent granted by the Council to the subject premises. In relation to category (e), the applicants have not established the relevance of correspondence between the second respondent and the manager of the SupaCenta to the facts in issue in the proceedings. At present the proceedings concern judicial review only, and the correspondence sought has no relevance to such a review.

52 Based on the nature of the proceedings at present, I also accept the second respondent's submission that I ought to have regard to paragraph 15 of the Practice Note. I am not satisfied that exceptional circumstances exist such that an order for discovery ought to be made in these proceedings.

53 I also note that even if leave had been granted for the amendments to be made to the pleadings, many of the specified categories are not relevant to any facts in issue identified by the amendments. For example, the proposed amendments to the pleadings do not set out any fact in issue concerning the operation of other similar businesses. Whilst the Statement of Environment Effects points to those businesses, there is no such issue raised in the pleadings. Therefore, even if leave were granted, categories (c) and (d) cannot be said to be relevant to a fact in issue in the proceedings. Further, category (e) is excessively broad and its relevance to a fact in issue is not established by any of the proposed amendments.

54 Therefore, in my view the notice of motion filed 1 October 2009 ought to be dismissed. Of course, this does not preclude the applicants from filing a similar notice of motion once the applicants ascertain the identity of the person who operates the premises. Such a notice of motion should be filed and served promptly, and I will therefore make a direction that any such notice of motion be filed within 10 days.

55 I accept, however, that amendments ought to be made to the timetable in the proceedings as a result of the delay experienced following the production of the subpoenaed material. 56 I make the following orders:

1. That the privilege claim in relation to Documents 1 and 3 of Schedule 1, and Documents 1, 3, 5 and 7 of Schedule 2 is upheld; 2. That access be granted to Document 2 of Schedule 1, and Document 2, 4 and 6 of Schedule 2; 3. That the second respondent facilitate order 2 by providing to the court, within 7 days, separate copies of the e-mails specified therein; 4. That the notice of motion filed by the applicants on 1 October 2009 be dismissed; 5. That any further notice of motion to be filed by the applicants seeking leave to amend the pleadings and to join a party to the proceedings be filed and served within 10 days; and 6. That the exhibits be returned.

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