This is the second judgment in this matter concerning a notice of motion filed on 23 June 2023 by which the defendant, INSW, seeks production of a large number of documents over which the plaintiffs (together, Grocon) have claimed privilege. My earlier judgment was delivered on 22 September 2023: see Grocon Group Holdings Pty Limited v Infrastructure NSW (No 2) [2023] NSWSC 1144. This judgment assumes familiarity with that judgment and uses the same abbreviations as used in it.
[2]
Background
The documents in respect of which Grocon makes a claim for privilege have either been discovered by Grocon or produced by Deloitte in response to a subpoena served by INSW. Deloitte was retained by Grocon to advise it in connection with the development at Central Barangaroo.
The documents in respect of which INSW challenges Grocon's claim for privilege are said to fall into six categories:
1. Documents with no apparent connection to any external solicitor and involving Mr John Easy;
2. Documents with no apparent connection to any external solicitor and involving Ms Carmen Hollingsworth;
3. Documents with no apparent connection to any external or internal solicitor;
4. Documents involving Dexus, GPT, Oxford, Aqualand and others;
5. Documents involving Mr Nogarotto and Ms Di Francesco;
6. Documents Grocon sent to its former consortium partners, Aqualand, Sentre and Oxford.
Mr Easy has been the Consultant General Counsel with Grocon since April 2017 and Ms Hollingsworth was the General Counsel of Grocon from 2013 to mid-2021, when she went on sick leave. Mr Easy and Ms Hollingsworth performed both legal and commercial roles for Grocon. Mr Easy has sworn two affidavits in the proceedings. The primary question in relation to documents falling within categories (1) and (2) is whether the documents in respect of which privilege is claimed were brought into existence for the dominant purpose of Mr Easy and Ms Hollingsworth giving legal advice.
In relation to the first category, the evidence is that Grocon has claimed privilege over 6,953 documents (including 3,423 host documents) discovered by it and privilege over 66 documents (including 35 host documents) produced by Deloitte. It has also claimed privilege over part of a further 19 documents discovered by it (all host documents). In relation to documents falling within category (2), the evidence is that Grocon has claimed privilege over 6,698 documents (including 2,427 host documents) discovered by it together with 185 documents (including 106 host documents) produced by Deloitte.
In the case of category (3), as the description of the category suggests, the documents have no apparent connection to an internal or external lawyer. They consist of internal communications or communications with Grocon's financial advisors. The evidence is that Groncon has claimed privilege over 1261 documents (including 505 host documents) discovered by it and 68 documents (including 41 host documents) produced by Deloitte which fall into this category.
In the case of category (4), the documents are said to be subject to a claim for without prejudice privilege. The evidence is that there are approximately 951 documents (including 435 host documents) falling within this category.
In the case of category (5), Mr Nogaroto was a lobbyist engaged by Grocon and Ms Di Francesco was a public relations consultant engaged by them. Grocon has claimed privilege over approximately 348 documents (including 127 host documents) falling within this category.
Finally, in the case of the category concerning consortium arrangements, Aqualand, Scentre (Westfield), and Oxford were members of the Grocon consortium. Grocon has claimed privilege over 37 documents (including 35 host documents) falling within this category.
The claim for privilege is made in a schedule which identifies (among other things) the date of the document, the title of the document, the author, the recipients, the persons to whom the document was copied and the basis of the claim for privilege, which is stated to be one of "advice privilege", "without prejudice privilege" or "litigation privilege".
In support of the claims for privilege, Ms Asia Lenard, the solicitor with Quinn Emmanuel who has day to day conduct of the matter on behalf of Grocon, swore two affidavits setting out the procedures that were followed for identifying the documents in respect of which a claim for privilege would be made. No attempt was made by Ms Lenard or anyone else to identify the purpose for which each document was brought into existence and the basis of the claim for privilege, apart from the information contained in the schedule referred to in the previous paragraph.
Normally, of course, that would not be sufficient. Courts have repeatedly made it clear that where a claim for privilege is challenged it is for the party asserting the claim who must establish that the claim is properly made and that cannot be done simply by asserting a legal conclusion. As Brereton J explained in Hancock v Rinehart (Privilege) [2016] NSWSC 12 at [7]:
To sustain a claim of privilege, the claimant must not merely assert it; but must prove the facts that establish that it is properly made. Thus a mere sworn assertion that the documents are privileged does not suffice, because it is an inadmissible assertion of law; the claimant must set out the facts from which the court can see that the assertion is rightly made, or in other words "expose … facts from which the [court] would have been able to make an informed decision as to whether the claim was supportable". The evidence must reveal the relevant characteristics of each document in respect of which privilege is claimed, and must do so by admissible direct evidence, not hearsay. [footnotes omitted]
Whether the last of these propositions is correct is open to some doubt. There are no special rules of admissibility in relation to a claim for privilege. The claim for privilege must be established by admissible evidence, and what evidence is sufficient will depend on the particular nature of the claim. What is clear, however, is that general assertions of the kind contained in the schedule and Ms Lenard's affidavits alone are not sufficient.
Where (as here) there is an issue whether documents were brought into existence for the purpose of giving legal advice or commercial advice, it is relevant to bear in mind that the distinction between the two is not always clear and that legal advice extends beyond simply giving advice on questions of law. As Allsop J explained in DSE (Holdings) Pty Ltd v InterTAN Inc (2003) 135 FCR 151 at [45], quoting from the decision of Taylor LJ in Balabel v Air India [1988] Ch 317 at 330:
What legal advice is, however, goes beyond formal advice as to the law. This recognition does not see the privilege extend to pure commercial advice. In any given circumstance, however, it may be impossible to disentangle the lawyer's views of the legal framework from other reasons that all go to make up the "advice as to what should prudently and sensibly be done in the relevant legal framework".
However, that does not alter the fact that generally the subject-matter of the advice must be sufficiently described so that the court can make an informed decision on whether the advice is properly described as legal advice as broadly understood.
In order to sustain a claim for without prejudice privilege, the relevant document (a) must record "a communication that is made between persons in dispute, or between one or more persons in dispute and a third party, in connection with an attempt to negotiate a settlement of the dispute" or (b) must have been prepared "in connection with an attempt to negotiate a settlement of a dispute": Evidence Act 1995 (NSW) s 131(1). The dispute must be "a dispute of a kind in respect of which relief may be given in an Australian or overseas proceeding": s 131(5). Consequently, the subject-matter of the document must be sufficiently described so that the court can make an informed decision on whether the document relates to an attempt to settle a dispute of a kind in respect of which relief may be given in an Australian or overseas proceeding.
During the course of argument, I indicated that I accepted Grocon's submission that in this case it was not practical to insist that Grocon provide evidence of the facts relating to each document in respect of which a claim for privilege was made and that the alternative adopted by Grocon of leading evidence from Ms Lenard of the procedures that were adopted to identify documents in respect of which a claim for privilege was made may be sufficient provided Grocon could establish that that system was reliable in the sense that the court could be confident that the system correctly identified documents in respect of which a claim for privilege was properly made. To that end, I proposed that, at least as a first step, INSW identify a sample of documents in respect of which privilege was claimed and that Grocon provide evidence in proper form of the basis on which privilege was claimed in relation to those documents. If that process revealed that privilege appeared to be properly claimed in respect of the documents in the sample, the court could be reasonably confident that the process described by Ms Lenard in her affidavits was likely to have led to proper claims for privilege.
The parties accepted that proposal and, on 15 September 2023, the Court made the following orders by consent:
1 The defendant to select and notify to the plaintiffs a sample of 70 documents referred to in Exhibit ALL-13 to the affidavit of Asia Laurel Lenard affirmed 30 August 2023 by 18 September 2023 falling within the following categories (adopting the nomenclature of the defendant's Notice of Motion filed 23 June 2023):
(a) 15 documents identified in the Motion as falling within Category 1;
(b) 15 documents identified in the Motion as falling within Category 2;
(c) 10 documents identified in the Motion as falling within Category 3;
(d) 15 documents identified in the Motion as falling within Category 4, including at least 3 documents sent to or received from each of Dexus, GPT, Oxford and Aqualand;
(e) 5 documents identified in the Motion as falling within Category 5, including at least 2 documents sent to or received from each of Mr Nogarotto and Ms Di Francesco;
(f) 10 Consortium Documents (as defined in the affidavit of Samuel Delaney sworn 23 June 2023 at [251]), including at least 3 documents sent to or received from each of Aqualand, Scentre and Oxford.
(Together, Sample Documents.)
2 The plaintiffs to file further evidence in support of their privilege claims over the Sample Documents by 9 October 2023.
3 The parties to exchange further written submissions on the Motion by 16 October 2023.
4 The question of whether the Sample Documents are privileged be determined on the papers unless the Court notifies the parties otherwise.
The dates set out in these orders were extended with the result that I received final submissions on 30 October 2023.
[3]
The sample
In all, INSW identified a sample of 71 documents. Of those, Grocon has abandoned its claim for privilege in relation to 19, INSW does not contest the claim for privilege in relation to 18 and 34 remain in dispute. It is necessary to say something about each of those 34 documents. It is convenient to identify those documents by reference to the numbers given to them in a schedule attached to INSW's submissions dated 25 October 2023. The claim for privilege in relation to those documents is supported by a further affidavit affirmed by Ms Lenard on 18 October 2023. Among other things, Ms Lenard gives evidence on information and belief of the purpose for which each of the documents was prepared.
[4]
Documents falling within category (1)
Fifteen sample documents fall within this category. Of those, Grocon has abandoned its claim for privilege in relation to seven (documents 3, 5, 7, 8, 11-13). INSW continues to dispute the claim in relation to the balance, which are documents 1-2, 4, 6, 9-10 and 14-15.
Document 1 is an email dated 22 July 2019 from Stephen Hynes of Deloitte to Mr Easy and Sam Bisla, copied to John Robson and David Tzirulnik of Deloitte, with the subject line "FW: Grocon Funding Opportunity". According to Ms Lenard, the document is privileged because it is apparent on its face that in the email Mr Hynes is seeking legal advice from Mr Easy on a contractual document. It appears from Grocon's schedule of privileged documents that the email attaches an "NDA" - presumably, a nondisclosure agreement. It is said that, because Deloitte was one of Grocon's advisors, the advice was being sought by Grocon. That seems an odd contention when Mr Easy was an employee of Grocon. In any event, in my opinion, it is not apparent on the face of the email that Deloitte is seeking advice on the terms of the agreement, and Ms Lenard does not give any evidence from which that conclusion could be drawn. Accordingly, I am not satisfied that the document is privileged.
Document 2 is an email dated 13 August 2019 from Stephen Hynes of Deloitte to Daniel Grollo, Angela Farbridge-Currie, Mr Bisla, Mr Easy and Ms Hollingsworth, copied to John Robson, David Tzirulnik and Bonnie Greenwell of Deloitte with the subject line "Nomura Update". Grocon claims privilege over part of this document. The document appears to be a report from Deloitte to Mr Grollo on discussions with Nomura, a potential lender. The email is said to record advice given by Minter Ellison, Grocon's lawyers, together with comments made by Mr Easy concerning the provision of advice "about the enforceability of the BDA minimum 59,000m2 GFA letter" and "the path in the next 60 days post SLRN [Sight Lines Resolution Notice] being issued". In my opinion, the document to that extent is privileged. Although it is not entirely clear, I think it can be inferred that Nomura was seeking to know what advice Grocon had received on certain legal matters, which were no doubt relevant to its decision to lend. Disclosure of that information did not amount to a waiver of the privilege and a record of the advice remains privileged.
Document 4 is an email dated 13 November 2018 from Chris Carolan (head of development for NSW for Grocon) to Mr Grollo and Mr Easy with the subject line "RE: Bob in Sydney this week". The email responds to an email of the same date and subject line sent by Mr Grollo to Mr Easy and Mr Carolan, which forwards an email chain between Mr Grollo and Paul Brundage of Oxford Properties (a prospective consortium partner and potential investor in the office component of the development). Ms Lenard accepts in her affidavit that only part of the email chain is privileged. However, she says that she is "informed by Mr Grollo and I believe that his email of 13 November 2018 was sent for two purposes: to obtain input from Mr Carolan and to obtain legal advice concerning the points raised by Oxford properties, with the latter purpose being dominant". In my opinion, this does not provide a proper basis for a claim for privilege. The hearsay assertion of Mr Grollo, which cannot be tested, does not provide a sufficient basis for a privilege claim. The subject-matter of the email is not sufficiently described to enable INSW or the Court to understand how it could be said that the dominant purpose of the email was to seek legal advice from, presumably, Mr Easy.
Document 6 is an email dated 18 June 2018 from Mr Carolan to Mr Easy and Mr Bisla with the subject line "FW: Site Lines Negotiation". The email attaches a letter entitled "AQL Grocon_Site Lines Negotiations _15.06.18" which was sent to Mr Carolan by John Carfi on 18 June 2018. Ms Lenard says she is "informed by Mr Carolan and I believe that he sent the email for two purposes: to update Mr Bisla and to seek legal advice from Mr Easy concerning the document sent by Mr Carfi. Of those two purposes, Mr Carolan informs me, and I believe, that his dominant purpose was to seek advice from Mr Easy". This document raises the same issues as document 4 and is not privileged for the same reasons.
Document 9 is said to be an email requesting certain information to be provided to Mr Easy so that Mr Easy could provide "advice to Grocon concerning negotiation of the Implementation Agreement with Oxford Properties". In my opinion, advice concerning the negotiations of an agreement is in the nature of legal advice. Therefore, I accept that the document is privileged.
Document 10 is an email to Macquarie Capital, which was assisting Grocon. The email attaches a draft document entitled "Project Polo - Office Component development Profit Share calculation 1". Ms Lenard says that the draft was prepared for the purpose of the sales process for the office component of Central Barangaroo. She also says that "I am informed by Mr Easy and I believe that the document was prepared for the purpose of the sale process, and because it was a draft it represented confidential legal advice to his client, Grocon". It may be inferred from what is said that the document was prepared by Mr Easy. However, it is not possible to say from the description of the document that it contained legal rather than commercial advice. I am not satisfied that the claim for privilege has been established.
Document 14 is described by Ms Lenard as an email dated 8 June 2019 from Ms Farbridge-Currie to Mr Bisla, copied to David Codron and Mr Easy, with the subject line "Cash flow June 19 - Aug 19_OXP.xlsx". The document was originally said to be the subject of a claim for legal professional privilege. However, in her affidavit, Ms Lenard says that "[t]he email states that it was prepared for the purpose of sending to Ferrier Hodgson and Oxford in the context of without prejudice negotiation of a resolution to the MaxCap Dispute" and is therefore the subject of a without prejudice privilege claim.
The MaxCap facility was a facility by which Twenty Twenty2 Pty Ltd lent money it had borrowed from MaxCap to Grocon. The loan from MaxCap was guaranteed by a number of companies in the Grocon group. The facility was due for repayment on 23 September 2018. However, at around that time Grocon was under significant financial stress and was unable to repay it. Eventually, MaxCap appointed receivers to certain Grocon properties. It later agreed to terminate that appointment. No court proceedings were commenced and there is no evidence that Grocon had any legal basis for disputing MaxCap's right to appoint a receiver. There was, therefore, no dispute which could attract the privilege.
Document 15 is an email dated 3 February 2019 from Mr Carolan to Mr Grollo, copied to Mr Easy, with the subject line "AFR Oxford". The email forwards a recent media article concerning an interview with an executive of Oxford properties. Ms Lenard says in relation to this document "I am informed by Mr Carolan, and I believe, that the email was sent for two purposes: to keep Mr Grollo updated and for the purpose of Mr Easy providing legal advice in relation to Grocon's performance of the Implementation Agreement. Although the email had two purposes, I am informed by Mr Carolan, and I believe, that the dominant purpose was to facilitate the informed provision of legal advice by Mr Easy". In my opinion, this evidence does not establish that the document is privileged. The description of the nature of the advice sought from Mr Easy is too vague to enable the Court to conclude that it was legal advice. The hearsay assertion of Mr Carolan's view is not sufficient to establish the dominant purpose of the document, and the fact that the document was sent to Mr Grollo and copied to Mr Easy suggests that the dominant purpose was not to obtain legal advice from Mr Easy.
[5]
Documents falling within category (2)
Fifteen sample documents fall within this category. Of those, Grocon has abandoned its claim for privilege in relation to four (documents 17, 19, 21 and 30). INSW accepts the claim for privilege in relation to two of the documents (documents 22 and 26). In addition, Grocon now only maintains a claim for privilege in relation to part of two documents. INSW accepts that claim in relation to one document (document 23) and to part of another (document 16). It continues to dispute the claim in relation to the balance, which are documents 18, 20, 24-25 and 27-29.
In relation to document 16, INSW says that the document produced by Grocon contains redactions in respect of communications from Mr Carolan and Mr Bisla. Ms Lenard gives no explanation for those redactions. I accept that they should be removed.
Document 18 is an email dated 13 August 2019 from Ms Hollingsworth to personnel from Grocon and Deloitte with the subject line "[EXT]RE: Nomura Update - JLL Letter (Item 1)". The email attaches a document entitled "CB Market Guidance Aug 19 (005)". Ms Lenard says that she is informed by Mr Grollo that the document provides advice to Grocon. However, the nature of the advice is not identified and it is not possible from the description of the document to say that it is legal advice. Consequently, I am not satisfied that the document is privileged.
Document 20 is an email dated 10 August 2017 from Mr Dan McLennan to Ms Hollingsworth which attaches draft board papers prepared by Mr McLennan at Ms Hollingsworth's request. However, there is no evidence that they were sent to Ms Hollingsworth for the dominant purpose of her giving legal advice. I am not satisfied that the document is privileged.
Document 24 is actually the subject of a claim for without prejudice privilege. Ms Lenard says that she is informed by Ms Farbridge-Currie, the CEO of Grocon from November 2018 to June 2021, that the document was prepared as part of negotiations to resolve what is referred to as the AIG Dispute. AIG had provided bonds in respect of two Grocon projects. Grocon was in the process of selling its rights in relation to one of those, known as the Ribbon Project. Anticipating that the bonds would shortly be called, Grocon sought to negotiate a release of some of the cash deposited by it to support the bonds to enable the sale to proceed. AIG would not agree and there were negotiations between Grocon and AIG throughout 2020 in relation to that matter. Eventually the sale of the project was competed, which included a resolution of the issue between AIG and Grocon.
There are two difficulties with this claim for privilege. First, I do not accept that the AIG Dispute was a dispute which attracts the privilege. It was a commercial dispute that could not give rise to a claim for relief in a court. Second, the evidence in support of the claim for privilege is conclusory in nature. Insufficient information is given about the document in order to be able to form a conclusion about the purpose of the document.
Document 25 is an email dated 5 March 2019 from Mr Bisla to Ms Farbridge-Currie and Ms Hollingsworth with the subject line "RE: Grocon EOI". The email responds to a chain including an email of the same date in which Ms Farbridge-Currie forwards an expression of interest from MaxCap to provide alternative finance to Grocon to Ms Hollingsworth and Mr Bisla. Ms Lenard says in her affidavit that the email sent by Ms Farbridge-Currie was sent "for the dominant purpose of seeking legal advice from Ms Hollingsworth concerning the expression of interest" and that it "was also sent with the purpose of informing Mr Bisla and obtaining his commercial views", but that was not the dominant purpose. There are two problems with this evidence. First, it does not explain why Mr Bisla's email is privileged. Second, the evidence consists of a bare assertion of a conclusion reached by Ms Farbridge-Currie. For those reasons, I do not accept the claim for privilege in relation to this document.
Document 27 is an email dated 15 August 2019 from Ms Hollingsworth to Stephen Hynes of Deloitte, which is copied to a number of others. The email has the subject line "FW: Nomura Update - Item 3 - SLRN". It is said to contain Ms Hollingsworth's advice on several subjects. But again there is nothing about the description of the email which indicates that the email records legal advice given by Ms Hollingsworth.
Document 28 is an email dated 2 August 2018 from which is said to be part of a chain that concerns advice given by Ms Hollingsworth to the directors of Grocon. The subject of the email is described as "RE: GGH Board - Solvency Resolution FY17/18 - GGH to GPL". It appears that Ms Hollingsworth's advice concerns that subject-matter. On that basis, I am prepared to accept that the email chain is privileged.
Document 29 is an email dated 8 December 2017 from Glen Kanevsky of Deloitte to Ms Hollingsworth among others responding to a request that Deloitte perform certain modelling work. It is unclear why the modelling work was for the dominant purpose of enabling Ms Holingsworth to give legal advice. In my opinion, the claim for privilege is not made out.
[6]
Documents falling within category (3)
Eleven sample documents fall within this category. Of those, INSW accepts the claim for privilege in relation to three of the documents (documents 36, 39 and 40). It continues to dispute the claim in relation to the balance, which are documents 31-35, 37-38 and 41.
Grocon claims part privilege over document 31 on the basis that it contains a reference to obtaining legal advice from King & Wood Mallesons. There is no suggestion that it discloses the substance of that advice. In my view, it is not privileged.
Originally, Grocon claimed privilege over the whole of document 32. It now only claims privilege over an email from Mr Easy that forms part of the document. The email from Mr Easy is said to be for the purpose of obtaining input from the recipients on a proposal by Oxford so that he could provide legal advice concerning the negotiation of the Aqualand Transaction and Pitt Street overstation development acquisition and conduct those negotiations in accordance with that advice. However, in the absence of knowing the subject-matter of the advice, it is not possible to say that the dominant purpose of the email was for Mr Easy to give legal advice. Without more information, it seems just as likely that Mr Easy was seeking input from others within Grocon on the commercial terms proposed by Oxford. I am not satisfied that the email is privileged.
Grocon accepts that in the light of my earlier judgment, it has waived privilege over document 33. As INSW points out, now the document has been produced, it is difficult to see why it was privileged. The document is an email from Mr McLennan, the General Manager of Business Development at Grocon, to Mr Karslake of Aqualand setting out Mr McLennan's own views about the Sight Lines Clauses.
Grocon accepts that in the light of my earlier judgment, it has waived privilege over document 34. Again, as INSW points out, now the document has been produced, it is difficult to see why it was privileged. It is an email dated 6 August 2019 from Mr Easy to Mr Grollo which contains a draft response to an email received from Mr Matheson of Oxford Properties. But the draft response says nothing that could be regarded as the product of legal advice.
Document 35 is an email dated 13 November 2017 from Mr Carolan to Anthony Poirrier with the subject line "FW: Attachments for DXS". The email is part of a chain which commences with an email dated 6 November 2017 from Mr Poirrier to Mr Easy with the subject line "Attachments for DXS". Ms Lenard says in her affidavit that she is informed by Mr Easy that Mr Poirrier's email and the attachment was prepared at his request for use in negotiating the potential sale of the office development rights to Dexus. I accept INSW's submission that that was a commercial purpose. Consequently, the document is not privileged.
INSW accepts that in light of evidence given about document 37 by Ms Lenard, the document is privileged. However, it submits that privilege in the document was waived when it was given to Oaktree Capital, a potential financier. I do not accept that submission. INSW submits that the communication of the document to Oaktree was not confidential because the information disclosed did not fall within the scope of the non-disclosure agreement executed by Oaktree. However, that does not necessarily mean that the communication was not confidential. The communication was to a single entity for a specific purpose in circumstances where Oaktree might have been expected only to use the communication for that purpose, even though the document was not specifically covered by the non-disclosure agreement. That is sufficient to make the communication confidential.
Document 38 is an email dated 11 June 2020 from Ms Farbridge-Currie to Darren Brusnahan of Impact Group with the subject line "RE: Northumberland Project Funding". The email is labelled "Without Prejudice". Grocon originally claimed that the document was the subject of legal professional privilege. It now claims that it is the subject of without prejudice privilege on the basis that it forms part of without prejudice negotiations to resolve what is referred to as the Impact Dispute. It is common ground that there was a dispute between Grocon and Impact Funds Management as trustee for the IIG Northumberland Property Trust. The difficulty with this claim, as with many of the others, is that insufficient information is given about the document for the Court or INSW to be able to assess the claim for privilege. I am not satisfied that the document is privileged.
Document 41 is an email dated 16 May 2018 from Kieran Pryke to David Codron with the subject line "Copy of Cash Flow - updated base case new Oxford (10 May 2018)kp amended.xlsx". The email attaches a document entitled "Copy of Cash Flow - updated base case new Oxford (10 May 2018) kp amended.xls". The cash flow was apparently prepared at the request of Ms Hollingsworth. No one is able to say why she requested the document. It is not obviously a document prepared for the purposes of giving legal advice. I am not satisfied that the document is privileged.
[7]
Documents falling within category (4)
Fifteen sample documents fall within this category. Of those, Grocon has abandoned its claim for privilege in relation to three (documents 43, 46 and 49). INSW accepts the claim for privilege in relation to six of the documents (documents 45, 47, 50 and 52-54). It continues to dispute the claim in relation to the balance, which are documents 42, 44, 48, 51, 55 and 56.
Document 42 is said to relate to the MaxCap Dispute. I have already held that that was not a dispute that could attract without prejudice privilege.
Document 44 is an email dated 23 November 2018 from Melanie Walmsley to Kevin George of Dexus, copied to Mr Grollo, with the subject line "RE: 480Q Surrender". The purpose of the document was to negotiate an extension of payment terms. I do not accept that the negotiation of an extension of payment terms involves without prejudice negotiations to settle a dispute.
Grocon appears no longer to assert that document 48 is the subject of a claim for without prejudice privilege. Instead, it claims that it is the subject of legal professional privilege. The document is an email dated 10 January 2019 from Mr Carolan to Mr Grollo and Ms Hollingsworth which attaches a draft strategy document prepared by Mr Grollo. It is said to be privileged because the dominant purpose of the communication was to obtain legal advice from Ms Hollingsworth. However, no information is given about the topics on which Ms Hollingsworth's advice was sought. Moreover, Ms Lenard accepts in her affidavit that one of the purposes of the email was to provide comments to Mr Grollo on the strategy he proposed. Consequently, it is not possible to say that the dominant purpose of the communication was to obtain legal advice from Ms Hollingsworth. I am not satisfied that the document is privileged.
Document 51 is another document where the claim is now for legal advice privilege. Like document 48, the document is said to have been brought into existence for two purposes, one of which was to obtain legal advice from Mr Easy. However, the subject-matter of that advice is not explained and consequently it is not possible to say that the dominant purpose of the communication was to obtain legal advice from Mr Easy. I am not satisfied that the document is privileged.
Documents 55 and 56 are said to relate to a dispute that arose following the sale of the Central Barangaroo development rights to Aqualand in which:
1. Security was held by the Trustee on behalf of the Developer entity;
2. There was a charge on one of the Grocon entities by the Trustee. The potential litigation funder of these proceedings wanted the charge removed; and
3. Upon Grocon demanding that Aqualand consent to removal of the charge, a dispute arose that was settled via without prejudice negotiations.
It is difficult to understand from this description what the legal dispute was. Rather, the negotiations appear to be commercial negotiations to make a change to accommodate the litigation funder. Those negotiations could not be the subject of without prejudice privilege.
[8]
Documents falling within category (5)
Five sample documents fall within this category. Of those, Grocon has abandoned its claim for privilege in relation to three (documents 57, 59, 60). INSW accepts the claim for privilege in relation to one of the documents (document 61) in respect of the attachment to that communication. That leaves documents 58 and 61 (in respect of the covering communication).
Document 58 is an email dated 30 October 2018 from Ms Hollingsworth to Ms Di Francesco copied to multiple Grocon personnel and Ms Lenard with the subject line "BDA ats Crown & LL - 30 Oct - Day Two Notes - AM". The email attaches a document entitled "BDA ats Crown & LL - Court Notes - 29 October 2018", which is Ms Hollingsworth's note of court proceedings. The email refers to obtaining advice from Ms Lenard concerning an aspect of the notes. INSW submits that the communication from Ms Hollingsworth to Ms Di Francesco is not itself privileged.
In my opinion, the attachment to the email is privileged as is any part of the email recording advice given by Ms Lenard. The privilege was not lost because the email was sent to Ms Di Francesco. There may be a question whether the balance of the email is relevant to any issue in the proceedings. However, to the extent that it is, in my opinion it should be produced unless it is purely formal in nature. In that event, I cannot see how it could be relevant to the issues in these proceedings and its production appears to be unnecessary.
Document 61 is an email dated 31 December 2020 from Mr Grollo to Mr Nogarotto of Crosby Textor with the subject line "Fwd:". The email attaches a document prepared by Quinn Emanuel for the purpose of without prejudice negotiation of a resolution of the present proceedings. It was sent to INSW under cover of an email labelled "Without prejudice save as to costs". INSW accepts that the attachment is privileged. It challenges the claim for privilege over the email itself. In my opinion, this document should be dealt with in the same way as document 58. If the email simply attaches a privileged document, there is no reason why it should be produced.
[9]
Documents falling within category (6)
Ten sample documents fall within this category. Of those, Grocon has abandoned its claim for privilege in relation to two (documents 62 and 66). In addition, Grocon now only claims privilege over parts of documents 63, 64 and 67-70 and INSW accepts those claims. That leaves document 71.
Grocon accepts that as a result of my earlier judgment it has waived privilege in respect of document 71 and it has produced the document. INSW submits that it is apparent from the document itself that it was not properly the claim for privilege. The document is part of an email chain that includes document 33, which is Mr McLennan's email dated 30 January 2017 in which he expresses his view on the Sight Lines Clauses. I accept that it was not privileged.
[10]
Conclusion and orders
It is apparent from the concessions made by Grocon and from what I have said that the review undertaken by Grocon to identify privileged documents was far from reliable and that evidence of that review cannot form a proper basis for a claim for privilege.
In my opinion, Grocon has had an ample opportunity to establish its claims for privilege but, apart from the documents specifically identified in this judgment as being the subject of a proper claim for privilege, has failed to do so. Consequently, with the exceptions I have referred to, it should produce the documents the subject of INSW's motion filed on 23 June 2023.
The parties should bring in short minutes of order to give effect to this judgment and to deal with the question of costs of the motion filed on 23 June 2023, if costs can be agreed. If the parties cannot agree on the terms of the short minutes of order by 17 November 2023, they should by 24 November 2023 each provide to my Associate a form of orders they seek and a short outline of written submissions not exceeding 3 pages in support of those orders, with the intention that any outstanding issues be decided on the papers.
[11]
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 10 November 2023