Corporate Affairs Commission (NSW) v Yuill

Corporate Affairs Commission (NSW) v Yuill - [1991] HCA 28 - HCA 1982 case summary — Zoe

In O'Reilly v. State Bank of Victoria Commissioners [16] , this Court held that legal professional privilege is limited to judicial and quasi-judicial proceedings and therefore did not qualify the obligation to comply with a notice issued under s. 264 of the Income Tax Assessment Act 1936 Cth by the Commissioner requiring a person to attend and give evidence and to produce books relating to any person's income or assessment. Then, in Baker v. Campbell [1] , this Court held that the power of a police officer executing a search warrant issued under s. 10 of the Crimes Act 1914 Cth is restricted by legal professional privilege. The Court by majority overruled the proposition that legal professional privilege is limited to judicial and quasi-judicial proceedings, holding that a statute should be construed as preserving a right to legal professional privilege unless the privilege is abrogated by express words or necessary intendment. The change in the law of this country which was effected by Baker v. Campbell raises two questions in relation to the construction of ss. 295 and 296(2) of the Companies (New South Wales) Code ("the Code"). Section 295 confers on an inspector power to require an officer of a corporation whose affairs are under investigation to produce books relating to its affairs and to appear for examination and to answer questions; s. 296(2) prohibits a refusal or failure to comply with such a requirement "without reasonable excuse". Should ss. 295 and 296(2) be construed in the light of the law as declared in Baker v. Campbell or in the light of the law as understood when the Code came into force on 1 July 1982 and as expressed in O'Reilly v. State Bank of Victoria Commissioners? And, if ss. 295 and 296(2) should be construed in the light of the law as declared in Baker v. Campbell, does the Code necessarily intend to abrogate legal professional privilege? The circumstances in which these questions arise and the relevant statutory context of ss. 295 and 296(2) of the Code are set out by Dawson J. and I shall not repeat them.

[7]

The authority of the courts to change the common law rules of statutory construction must therefore be extremely limited for the courts are duty bound to the legislature to give effect to the words of the legislature according to the rules which the courts themselves have prescribed for the communication of the legislature's intentions: In re Jordison; Raine v. Jordison [4] ; Sorby v. The Commonwealth [5] . It is only when the operation of an old rule fails to yield the effect that the court conceives the legislature would intend its words to have in contemporary conditions (see, e.g., Bropho v. Western Australia [6] ) that it is legitimate for the courts to propound a new rule better fitted to accord with that conceived intention. Baker v. Campbell should not be regarded as prescribing an alteration in the rules of statutory construction, but rather as declaring legal professional privilege to be a common law right or privilege available (unless excluded) not only in judicial and quasi-judicial proceedings but whenever the exercise of a statutory power would trespass upon the confidentiality of the communications which the privilege protects. We are therefore not so much concerned with a change in the rules of statutory construction, as with an application of the presumption that the legislature does not intend to abrogate a common law right or privilege unless a contrary intention is clearly expressed or implied in the statute. That presumption is a means by which to discover the true intention of the legislature: see Potter v. Minahan [7] , per O'Connor J. We are thus concerned with an application of that presumption in a legal matrix which has changed since the Code was enacted. The alteration of the law which Baker v. Campbell prescribes evokes an application of the rule contemporanea expositio est optima et fortissima in lege - the best and surest mode of construing an instrument is to read it in the sense which would have been applied when it was drawn up: Broom's Legal Maxims, 10th ed. (1939), p. 463. And so, the answer to our first question is that the Code should be construed in the light of the law as it stood when the Code came into force - that is, the law as it stood before Baker v. Campbell was decided - unless there be something in the Code which is inconsistent with the operation that would thus be attributed to the Code.

[15]

However, there is no provision of the Code which precludes the admission in evidence of books produced in compliance with a requirement under s. 295, even though any obligation to produce those books under the general law would be subject to unwaived legal professional privilege. Indeed, the Code provides for the taking of possession by the inspector and the retention by the National Companies and Securities Commission of possession of books so produced (ss. 295(6), 307) and for the Commission to permit their use for the purposes of legal proceedings instituted as a result of the investigation: s. 307(1)(d). Although the circumstances in which privileged documents are obtained by an adversary may preclude the adversary's tendering of those documents or secondary evidence of them (see, in addition to Baker v. Campbell [11] and the cases there cited, Goddard v. Nationwide Building Society [12] ; Guinness Peat Properties Ltd. v. Fitzroy Robinson Partnership [13] ; and Hooker Corporation Ltd v. Darling Harbour Authority [14] ), it is clear that the Code intends that books which the Commission permits to be used in proceedings should not be inadmissible in evidence by reason of the manner in which their production and retention have been obtained. The absence of some provision protective of the privilege in relation to books when they are tendered in evidence, comparable with the provision of s. 299(2)(d) in relation to oral evidence, arguably suggests that the Code intends legal professional privilege to qualify the obligation to produce books. But legal professional privilege in the event of civil proceedings is not protected by the Code even in respect of oral evidence. If oral evidence given before an inspector goes to establish a fact or matter and the inspector reports that he finds that that fact or matter exists, a certified copy of the report itself is admissible as evidence of that fact or matter in civil proceedings: s. 306(12). The protection accorded to oral evidence by s. 299(2)(d) is probably to be explained by the legislature's unwillingness to compel a person to furnish out of his own mouth evidence which might be used against him on a criminal trial (cf. Hammond v. The Commonwealth [15] ) even though the compulsory disclosure of privileged communications might lead to the discovery of other admissible evidence: Hamilton v. Oades [16] . That consideration does not inhibit the compulsory production of books which might be used in evidence, for books are real evidence which speak for themselves unlike oral evidence which comes into existence only in response to an exercise of investigative power: Controlled Consultants Pty. Ltd. v. Commissioner for Corporate Affairs [17] .

[49]

No inspector appointed under this Act shall require disclosure by a duly qualified legal practitioner of any privileged communication made to him in that capacity, except as respects the name and address of his client. Inspection under the uniform companies legislation was a procedure comparable to a special investigation under Pt VII of the Code. There was, as might be expected, no indication that the draftsman of the legislation in 1961 understood that a claim for legal professional privilege might be made in the course of an inspection, which, upon the basis of Testro Bros. Pty. Ltd. v. Tait, was not a judicial or quasi-judicial proceeding. Nevertheless, it was evidently felt necessary to protect legal practitioners against the compulsory disclosure of privileged communications to an inspector. No such concern was shown where the client himself was required to provide information and the legal practitioner was required to disclose the name and address of his client, obviously to enable the necessary information to be obtained compulsorily from the latter. In Re Stanhill Consolidated Ltd. [36] an inspector obtained from the liquidator of a company the waiver of any privilege on the part of the company, but Menhennitt J. held that certain privileged communications remained privileged within the meaning of s. 367, notwithstanding the purported waiver by the liquidator, with the consequence that the company's solicitor was entitled to refuse to reveal them. Section 308 of the Code represents s. 367 in an amended form. It allows the privilege to be waived, but otherwise entitles a legal practitioner to claim privilege against an inspector. Thus s. 308 represents (as did s. 367 before it) what was thought to be a limited extension of the doctrine of legal professional privilege into the area of company investigation in order to protect the professional confidence of a legal practitioner. At the same time it manifests an intention to extend the protection of legal professional privilege no further; in particular, not to extend it to the client. 1. [1967] V.R. 749.

[103]

The right to refuse to disclose communications and materials passing between a legal adviser and client for the purposes of advice or use in existing or anticipated litigation is a fundamental common law right: Baker v. Campbell. An intention to abolish the privilege will not be assumed and will not be inferred "from indirect references, uncertain inferences or equivocal considerations": The Commissioner of Police v. Tanos [70] . Nor is such an intention to be inferred from the application of the expressio unius principle: cf. Annetts v. McCann [71] . This right can be taken away only by express words or necessary implication. The general words of s. 295 are not themselves sufficient to abolish the privilege any more than the general words of s. 10 of the Crimes Act 1914 Cth were sufficient to abolish the privilege in Baker v. Campbell. Nor are the references to the privilege in ss. 299(2)(d) and 308, when read with s. 295, sufficient to indicate an intention to exclude the privilege. The words of s. 299(2)(d) - "matter in respect of which a claim of legal professional privilege could be made by the person in the proceedings if the provisions of this Division [sic] did not apply in relation to that evidence" - do not unequivocally indicate that Parliament intended the privilege not to be a "reasonable excuse" for the purpose of s. 296. They are explicable on the basis that the Parliament assumed that the privilege did not apply in Pt VII proceedings and that once privileged matter was disclosed it would thereafter be admissible in any legal proceedings. Section 299(2)(d) shows only an intention to protect the privilege, not an intention to exclude it from the protection conferred by s. 296(2). Of course, s. 299(2)(d) is unnecessary if the privilege can be claimed in answer to a requirement made under s. 295. But that is because Parliament assumed that legal professional privilege did not apply in Pt VII proceedings; s. 299(2)(d) gives no guidance as to what the intention of Parliament was if the privilege should be held to be available in those proceedings. Likewise, the terms of s. 308 do not unequivocally indicate that the Parliament intended to exclude legal professional privilege as a "reasonable excuse" within the meaning of s. 296(2). That section is also explicable on the basis that the privilege was assumed to be inapplicable in Pt VII proceedings. Even then s. 308 seeks to protect the position of the legal practitioner by entitling him or her to refuse to comply with the requirement unless authorised by the person entitled to claim the privilege.

At a glance

Court

Decision date

Before

Source

Judgment (112 paragraphs)

Parties