Procedure - Discovery and interrogation - Production and inspection - Grounds for resisting production - Legal professional privilege - Waiver of privilege.

Attorney-General (NT) v Maurice [1986] HCA 80; (1986) 161 CLR 475; Goldberg v Ng [1995] HCA 39; (1995) 185 CLR 83, discussed.

Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1, applied.

Judgment Number: [2004] TASSC 119

1 In June 1994 the plaintiff was admitted to the second defendant's hospital ("the hospital") and operated on by the first defendant ("the surgeon"). The plaintiff has brought proceedings against both defendants alleging that they were in breach of the duty of care they owed her, as a result of which she suffered loss, injury and damage. For the purposes of this application it is only necessary to note that the plaintiff alleges that the surgeon perforated her bowel whilst performing a surgical procedure and that both he and the hospital were negligent in not discovering that fact and in not giving her timely treatment for septicaemia and peritonitis. There are contribution proceedings between defendants.

2 The solicitors for the hospital consulted a Professor Pearson, Professor of Nursing and Director of the Bundoora Nursing Studies Unit at Latrobe University, Victoria. In result, a proof of evidence of Professor Pearson was produced. In par4, it states:

"In order to express opinions in respect of identified issues, I was supply[ied] with copies of the following documents:"

3 There follows a list of 19 documents. Eight of those documents are described as "a statement from [name inserted], a nurse at St Luke's". The proof of evidence runs to six pages. It expresses the opinion, with reasons, that there is no evidence to support the allegations of negligence pleaded against the hospital.

4 The solicitor for the hospital sent a copy of that proof of evidence to the solicitor for the surgeon on 7 July 2003. The accompanying letter said, in part:

"I enclose by way of delivery a proof of evidence of Professor Pearson. I am now ready for trial."

5 The solicitor for the surgeon sought copies of the eight statements from the hospital's nurses. The solicitor for the hospital declined to comply with the request. An application was made to the Master for an order that the hospital provide copies of the statements. I assume that the application was intended to be for an order that the hospital produce the statements for inspection. The application was dismissed. See [2004] TASSC 81. The solicitor for the surgeon has brought this appeal from the learned Master's order of dismissal.

6 It was common ground, both before the learned Master and on the hearing of this appeal, that the eight statements attracted profession legal privilege. The issue was, and is, whether that privilege has been lost or waived by reason of the delivery of a proof of evidence in which reference is made to those statements.

7 Attorney-General (NT) v Maurice [1986] HCA 80; (1986) 161 CLR 475 concerned the issue of privilege attaching to source documents from which a claims book was compiled and filed in connection with a land claim. The claims book comprised 447 pages. The source documents were not specifically mentioned in the claims book, nor are passages from them cited in that book. In that sense, the facts in Maurice differ from the facts at hand. In his judgment, Gibbs CJ said that every privilege could be waived, either expressly or by implication. He said, at 481:

"... the question whether a waiver should be implied depends on whether it would be unfair or misleading to allow a party to refer to or use material and yet assert that that material, or material associated with it, is privileged from production."

8 In a joint judgment, Mason and Brennan JJ said, at 487 - 488:

"An implied waiver occurs when, by reason of some conduct on the privilege holder's part, it becomes unfair to maintain the privilege. The holder of the privilege should not be able to abuse it by using it to create an inaccurate perception of the protected communication. [There follows a reference to Wigmore, Evidence in Trials at Common Law (1961) Vol 8, par2327]."

9 A little further on at 488, their Honours said, "the implied waiver inquiry is at bottom focused on the fairness of imputing such a waiver". Deane J said, at 492 - 493:

"Waiver of legal professional privilege by imputation or implication of law is based on notions of fairness. It occurs in circumstances where a person has used privileged material in such a way that it would be unfair for him to assert that legal professional privilege rendered him immune from procedures pursuant to which he would otherwise be compellable to produce or allow access to the material which he has elected to use to his own advantage."

10 The remaining member of the court, Dawson J, adopted the same approach as the other members of the court and said, at 497:

"This is a difficult area of the law, but it is clear enough that an implied waiver may be required by fairness notwithstanding that it was not intended. It would not be fair to allow privilege to be waived with respect to a portion of a document or a conversation without requiring disclosure of the rest of it, at least if the document or conversation dealt with the one subject matter."

11 The High Court applied the principle expressed in Maurice in Goldberg v Ng [1995] HCA 39; (1995) 185 CLR 83. This case concerned some privileged documents that were given to the Law Society in response to a complaint that had been made about a solicitor. At the time the documents were handed over, privilege was expressly claimed except, of course, against the Law Society. At the time that was done, proceedings about the same issues had already been commenced in the Supreme Court. In those proceedings it was claimed that privilege had been waived by delivery to the Law Society. Fairness was affirmed to be at the bottom of the inquiry about implied waiver. At 98, the joint judgment stated that it did not read Maurice's case as confining the relevant conduct on the issue of fairness to that occurring in the proceedings in which waiver is claimed. So, in Goldberg, regard was had to conduct in the Law Society proceedings and in the Supreme Court proceedings, as the two proceedings were closely related for the purpose of determining the issue of fairness.

12 In Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1, the High Court revisited the issue of implied waiver of professional legal privilege. That case concerned a letter and some attached legal opinions. The latter were protected by legal professional privilege. The addressee received the letter and attachments in his capacity as a member of the ACT Parliament from the respondent, who was then the Chief Minister of the Territory. There was evidence that it was an established practice in the ACT, and in other legislatures, for Ministers to provide members with this kind of information in confidence to enable the members to better perform their parliamentary duties. The addressee of the Chief Minister's letter respected this arrangement and sent the privileged material back without making a copy. He then sent the Chief Minister's letter, without the attachments, to the appellant. The question was whether the Chief Minister had waived privilege by sending the privileged material to the member of the ACT Legislative Assembly.

13 Gleeson CJ, Gaudron, Gummow and Callinan JJ wrote a joint judgment. It seems to me, with respect, that their Honours took a slightly different tack in that case from that taken by the justices in Maurice's case. At 13, the judgment asserts:

"It is inconsistency between the conduct of the client and maintenance of the confidentiality which effects a waiver of the privilege."

The footnote to support this assertion refers to a passage from Cross on Evidence and to two pages in the judgment of Dawson J in Maurice. I have to confess to some difficulty in finding any reference to inconsistent conduct in the two pages from the judgment of Dawson J.

14 In Mann, the joint judgment goes on to describe this inconsistent conduct as giving rise to waiver by operation of law and in this context refers to Goldberg v Ng (supra). Reference is then made to the need to determine the consequences of inconsistent conduct (waiver), even in the face of a subjective intention to the contrary. There follows this passage, at 13:

"What brings about the waiver is the inconsistency, which the courts, where necessary informed by considerations of fairness, perceive, between the conduct of the client and maintenance of the confidentiality; not some overriding principle of fairness operating at large."

15 The joint judgment then refers extensively to Goldberg and determines that privilege has not been waived by operation of law after this illuminating passage at 15:

"Disclosure by a client of confidential legal advice received by the client, which may be for the purpose of explaining or justifying the client's actions, or for some other purpose, will waive privilege if such disclosure is inconsistent with the confidentiality which the privilege serves to protect. Depending upon the circumstances of the case, considerations of fairness may be relevant to a determination of whether there is such inconsistency. The reasoning of the majority in Goldberg (supra at 101-102) illustrates this."

16 What then is the relevant inconsistent conduct in this case? I assume that the eight statements by the hospital's nurses came into existence for the dominant purposes of enabling the solicitor for the hospital to give the hospital legal advice with respect to the litigation between it and the plaintiff, and between it and the surgeon, and/or for use in that litigation. Consistent with that purpose, the statements were sent to Professor Pearson in order to obtain his advice with respect to that litigation. In result, a proof of Professor Pearson's evidence came into existence. In it, he identifies all the documentation sent to him, including the eight statements. In the discussion and expression of opinion that appears in that document, there are six references to "the documentation" without discrimination, two references to hospital charts and one reference each to operation notes and a medical report. Upon a fair reading of the whole of the proof of evidence, the only conclusion reasonably open is that in the formulation of his opinions, Professor Pearson relied to some unspecified extent on the eight statements.

17 Is it inconsistent to maintain a claim for legal professional privilege with respect to those statements, and at the same time send the proof of evidence to the solicitor for the surgeon with the advice that it is by way of delivery of a proof of evidence, and that the hospital is now ready for trial?

18 The hospital's conduct amounted to an assertion that it intends to adduce expert opinion evidence contrary to the case being brought against the hospital based, in part, upon these eight statements, but it is not prepared to produce these statements for inspection. It seems to me, with respect to those who take a different view, that this is inconsistent conduct and does give rise to waiver by operation of law. What is the relevant confidentiality which the privilege serves to protect? The privilege relevantly protects from disclosure a confidential communication prepared by, or for, the hospital's lawyer for the dominant purpose of providing legal advice to the hospital concerning these proceedings, or for providing the hospital with professional legal services relating to these proceedings.

19 Preparation for trial is governed by the Supreme Court Rules 2000. Rule 516 requires a party to serve on every other party a reasonable time before trial, "the substance of the evidence that it is proposed to adduce from the witness as an expert". There would have been compliance with that rule if the substance of the contents of the statements had been asserted in the proof as assumptions of fact. In that event, it is unlikely that there would be a claim of inconsistent conduct. However, that did not occur. The letter accompanying the proof, in effect, advised the solicitor for the surgeon that opinion evidence based (inter alia) on the contents of these statements was going to be adduced at trial. Given that the privilege serves to protect from disclosure eight written communications, the dominant purpose of which was to enable the provision of legal advice concerning these proceedings, or the provision of professional legal services relating to these proceedings, it is surely inconsistent with that privilege to state that in compliance with r516, there will be reliance upon the contents of these documents to support opinion evidence. Maintaining the privilege effectively prevents the surgeon from properly preparing for trial. No doubt such preparation would include the referral of Professor Pearson's proof to an expert of the surgeon's choosing. To give proper advice, the surgeon's expert would need to have access to the same material as did Professor Pearson when the latter formed the opinions that are expressed in the proof.

20 The learned Master took a different approach to this question. He firstly stated that, in effect, the contents of the statements are no more than suppositions of fact upon which Professor Pearson formulated his opinion and that for the opinion to be of any use, those facts would have to be proved by evidence. I agree with that general proposition. The learned Master then said:

"The expert in his report expresses an opinion to the effect that he can find nothing in the documents supplied to him indicative of negligence. The opinion, of course is completely valueless for those who do not have access to all the documents. There is no inconsistency in the expression of an opinion which, unless the documents are produced, the tribunal of fact will find to be valueless and the maintenance of the confidentiality of the witness statements. There are no quotes from or recitals of the substance of the witness statements or parts of them and so again, there is no inconsistency in the delivery of the report and the maintenance of the confidentiality of the witness statements. There will be no order for delivery of copies of the documents. The application is dismissed."

21 It is not the documents that will have to be produced at trial, but evidence to prove the facts asserted in the documents. However, that it is a side wind. With great respect to the learned Master, I have reached the conclusion that the relevant conduct is not what may or may not happen at trial. The relevant conduct is the delivery of the proof of evidence and the letter, in compliance with r516.

22 This issue was raised in Atkinson v T & P Fabrications Pty Ltd & Ors [2001] TASSC 38; (2001) 10 Tas R 57. In this case, Evans J adopted the same approach as I have adopted on this appeal. He said, at 59:

"The requisite inconsistency may be manifested when a party indicates an intention to rely upon evidence of a witness which is based upon privileged material provided to that witness. This, not infrequently, occurs when a party delivers an affidavit or proof of expert evidence of a witness. In that situation, the inconsistency between the party's conduct and the maintenance of a claim for privilege in relation to the material relied upon by the witness is compounded by the unfairness of allowing the party's witness to refer to that material whilst also allowing that party to shield the material from scrutinisation and testing by a claim of privilege. Jessup & Anor v Gorjup Serial No 139/1997 is a case where a claim for privilege was lost in these circumstances."

23 However, as it turned out in that case, the evidence established that the expert did not rely for his opinion on any part of the document referred to in his proof of evidence and, accordingly, Evans J held that the claim of privilege had not been waived. Jessup & Anor v Gorjup 139/1997 was a similar case. In that case, the plaintiff argued that if the defendant intends to call an expert witness whose opinions are based on material contained in privileged documents, it is only fair that the documents should be produced for their inspection. That decision was handed down before Mann v Carnell (supra) was decided. It is of little value, not for that reason, but because, as his Honour said at 3:

"It was common ground at the hearing of the application that if I determine that the contents of a particular document influenced the contents of Mr Enkelman's proof of evidence then there has been a waiver with regard to privilege in respect of the document, because it would be unfair that the contents be kept from the plaintiffs."

24 His Honour dealt with the issue upon that basis.

25 I was referred to a decision of the South Australian Supreme Court, Cole v Dyer [1999] SASC 272. That case concerned the proof of expert evidence which referred to facts that were contained in two statements made by the first defendant following a motor vehicle accident. It was common ground that professional legal privilege attached to these statements unless it had been waived by operation of law. With reference to the rule of court that requires pre-trial delivery of a proof of expert opinion evidence, Doyle CJ said, at par35:

"The fact that an expert report is required to be disclosed by operation of r38.01, and that the disclosure is not made voluntarily, is a relevant matter in deciding whether fairness requires that a waiver of privilege in relation to source materials be imputed. But the mere fact that the disclosure is not made voluntarily cannot be decisive, if the ultimate question is one of fairness. Each case has to be considered on its facts."

26 It should be noted that this decision was handed down before the High Court decision in Mann v Carnell, but nonetheless the above observation is still relevant. The issue of implied waiver in that case turned very much upon the provisions of the South Australian Rules of Court, r38.01(7), which requires delivery of "particulars identifying the material upon which the expert bases his or her expert opinion". Doyle CJ concluded that because the parts of the first defendant's statements on which the expert based his opinion were particularised pursuant to that special rule, he did not think it unfair that the defendant should be permitted to withhold from production the balance of the first defendant's statements. The failure to disclose the balance would not, as he observed, prevent any other party from adequately preparing for trial. I do not find that case of assistance in the present matter because of that special rule of court. In the present matter, although r516 required the hospital to set out the substance of Professor Pearson's evidence, it did not compel him to disclose the statements of the nurses. It did compel him to set out the facts upon which he relied, but not the source of those facts.

27 The appeal is allowed. The order of dismissal is quashed. I will hear the parties with respect to the form of order that should be substituted.