Counsel for Applicant: Mr S.P. Charles QC with Dr S. Kenny

Counsel for Respondents: Mr R. Merkel QC with Mr R. Strong

Solicitors for Respondents: Regional General Counsel for

Victoria - Australian Securities

Commission

Counsel for Applicant: Mr J.W.K. Burnside QC with Mr C.M. Scerri

Counsel for First Respondent: Mr R. Merkel QC with Mr R. Strong

Solicitors for First Respondent: Regional General Counsel for

Victoria - Australian Securities

Commission

Counsel for First Respondent: Mr R. Merkel QC with Mr R. Strong

Solicitors for First Respondent: Regional General Counsel for

Victoria - Australian Securities

Commission

1. The First Respondent within 14 days make discovery in accordance

with O 15 r 10 of the Federal Court Rules to the Applicant of the

written advice of Mr Robert Strong of counsel dated 20 April 1993

insofar as it relates to the decision that a further proceeding be

issued in which the plaintiffs would be the noteholders not

involved in the original proceedings.

2. The Respondents within 28 days give general discovery to the

Applicant in accordance with O 15 r 6 of the Federal Court Rules.

3. The Applicant's motions, notice of which are dated 30 June 1993

and 28 July 1993, be otherwise refused insofar as they have not

been dealt with previously.

4. The costs of the motions, insofar as they have not been dealt with

1. The First Respondent within 14 days make discovery in accordance

with O 15 r 10 of the Federal Court Rules to the Applicant of the

written advice of Mr Robert Strong of counsel dated 20 April 1993

insofar as it relates to the decision that a further proceeding be

issued in which the plaintiffs would be the noteholders not

involved in the original proceedings.

2. The Respondents within 28 days give general discovery to the

Applicant in accordance with O 15 r 6 of the Federal Court Rules.

3. The Applicant's motion, notice of which is dated 2 August 1993, be

otherwise refused insofar as it has not been dealt with

previously.

4. The costs of the motions, insofar as they have not been dealt with

1. The First Respondent within 14 days make discovery in accordance

with O 15 r 10 of the Federal Court Rules to the Applicant of the

written advice of Mr Robert Strong of counsel dated 20 April 1993

insofar as it relates to the decision that a further proceeding be

issued in which the plaintiffs would be the noteholders not

involved in the original proceedings.

2. The Respondents within 28 days give general discovery to the

Applicant in accordance with O 15 r 6 days of the Federal Court

Rules.

3. The Applicant's motion, notice of which is dated 28 July 1993, be

otherwise refused insofar as it has not been dealt with

previously.

4. The costs of the motions, insofar as they have not been dealt with

Note: Settlement and entry of orders is dealt with in Order 36 of The F ederal Court Rules

NORTHROP J On 5 and 9 August 1993, the Court heard motions on notice by the applicants in each of these proceedings. The reasons for judgment published on 23 August 1993 for the orders made on 5 August 1993 set out the background to the present motions and the matters set out in those reasons need not be repeated.

2. In proceeding VG No 188 of 1993, pursuant to notices dated 30 June 1993 and 28 July 1993, the applicant Hugh Ross Somerville moves the court for orders for general discovery by the Commission under O 15 of the Federal Court Rules and for inspection of particular documents pursuant to O 15 r 11(1)(b) respectively. Order 15 r 11(1)(b) provides, in substance, that where a pleading filed by a party refers to any document, the Court may "subject to any question of privilege which may arise" order the party to produce the documents for inspection by any other party. The documents identified by the applicant can be described as follows:

1. Staff paper to the Commission dated 5 January 1993;

2. Staff paper to the Commission dated 27 April 1993;

3. Written advice of Mr Robert Strong (of counsel) dated 20 April

1993;

4. Staff briefing paper to the Commission dated 10 June 1993;

5. Minutes of the meeting of the Commission held on 10 June 1993.

(These minutes have not been prepared. The relevant parts will be

provided to the applicant when available. Consideration of

whether any order with respect to these minutes should be made can

be deferred indefinitely); and

6. Documents referred to in the minutes mentioned in 5.

3. Strictly, no mention has been made of the documents contained in 5 and 6. Questions arise whether the motion under O 15 r 11 with respect to item 6 is premature. This issue can be deferred. Further it is noted that the application was issued on 14 May 1993. No issue based on this fact was raised at the hearing.

4. In proceeding VG No 190 of 1993, pursuant to notice dated 2 August 1993, the applicant ANZ Executors and Trustee Co Ltd moves the Court for orders for general discovery by the Commission under O 15 and for inspection of particular documents pursuant to O 15 r 11(1)(b). The motion refers to a long list of documents most of which have been produced by the Commission for the inspection by the applicant. The documents not produced include the documents numbered 1 to 5 set out above but in addition include:

7. Any note, memorandum on record of the oral advice of Mr Neil

McPhee QC of 28 April 1993

8. Any note, memorandum, or record of the oral advice of Senior

Counsel given on or before 10 June 1993 that there was no proven

basis for review of the decisions (of the Commission).

5. The comments made in relation to proceeding No VG 188 of 1993 apply to this proceeding also.

6. In proceeding No VG No 205 of 1993, pursuant to notice dated 28 July 1993, the applicant Day Nielson Jenkins and Johns moves the Court for orders for general discovery by the Commission under O 15 and for inspection of particular documents pursuant to O15 r 11(1)(b). The motion refers to the four documents being the documents numbered 1, 2, 4 and 5 set out above. No inspection is sought of the documents numbered 3, 7 and 8 being the advice, or rather, the notes of advice given by counsel. The comments made in relation to proceeding No VG No 188 of 1993 apply to this proceeding also but it is noted that this application was issued on 25 May 1993, some eleven days later than the other two applications.

7. In order to understand the issues raised by the motions, it is necessary to set out in some detail the history of the proceedings. Each of the applications was brought under the Administrative Decisions (Judicial Review) Act 1977 (the "Judicial Review Act") seeking orders of review of a number of decisions of the Commission made under s50 of the Australian Securities Commission Act 1989, (the "ASC Law").

"50 Where, as a result of an investigation or from a record of

an examination (being an investigation or examination conducted

under this Part or a corresponding law), it appears to the

Commission to be in the public interest for a person to begin and

carry on a proceeding for:

(a) the recovery of damages for fraud, negligence, default,

breach of duty, or other misconduct, committed in connection

with a matter to which the investigation or examination

related; or

(b) recovery of property of the person;

the Commission:

(c) if the person is a company - may cause; or

(d) otherwise - may, with the person's written consent, cause;

such a proceeding to be begun and carried on in the person's

name."

9. The subject matter for consideration under paragraph 50(a) is a proceeding for "the recovery of damages for fraud, negligence, default, breach of duty or other misconduct committed in connection with a matter ... ". The section does not identify the persons or class of persons against whom the recovery of damages can be sought. In the present case the relevant proceeding is action No 2045 of 1993 F3968 in the Supreme Court of Victoria. The plaintiffs are noteholders in Farrow Finance Co Ltd. Originally there were five plaintiffs but other persons have been added as plaintiffs. The three defendants are the applicants in the proceedings before this Court. In essence, the applicants are seeking orders under the Judicial Review Act to restrain the Commission from carrying on the Supreme Court action.

10. Each application identifies some nine decisions of the Commission which are sought to be reviewed under the Judicial Review Act. In addition, conduct of the Commission is sought to be reviewed but, for present purposes, reference need be made to the decisions only. It is not necessary to refer in detail to all the decisions identified in the applications. To illustrate the decisions sought to be challenged, reference can be made to the application by Mr Somerville. The decisions sought to be challenged are identified as A1 to A9 inclusive. Decisions A1, A4, A6 and A8 relate to decisions that it was in the public interest for the noteholders to bring proceedings against the applicants. The decisions relate to the original plaintiffs and additional plaintiffs. Decisions A2, A3, A5 and A7 relate to decisions to begin and carry on the Supreme Court action. Decision A9 relates to a decision by the Commission to refuse to supply reasons under s13 of the Judicial Review Act.

11. At the first directions hearing of the three applications, it was ordered that each application for an order of review stand as a statement of claim and that the Commission file and serve a defence to each of the statements of claim. The wording of the applications did not comply with the requirements of the Rules concerning a pleading. The Commission raised no objection to form but its defence was somewhat unusual in that each defence attempted to identify each decision sought to be challenged. Each defence alleged that none of the decisions were reviewable under the Judicial Review Act and that the Court had no jurisdiction to review them. No objection to competency was given under O 54 r 4. Each defence denied the Commission had made the decisions alleged in A1, A2, A7 and A8 but said it did decide that it was in the public interest for the noteholders to bring proceedings against the applicants. It appears that the reference to A1, A2, A7 and A8 should have been to A1, A4, A6 and A8. The Commission admitted that it made the decisions alleged in A3, A4, A5, A6 and A9. This should have been a reference to decisions A2, A3, A5, A7 and A9. Thus, the Commission clearly stated that it made the decisions relating to the public interest and then made the decisions relating to beginning and carrying on the Supreme Court action with respect to the original and additional plaintiffs. Other defences were raised.

12. The applicants sought further particulars of the defences. These were supplied by the Commission. The particulars given with respect to the decisions A1 to A8 form the basis for the present motions. The particulars sought and given relate to written documents, conversations and implications from facts. The further particulars related to each of the decisions A1 to A8 inclusive. A large number of documents were identified by the Commission in the particulars so given including minutes of the relevant meetings of the Commission. The documents identified in the further particulars are listed in the Schedule to the motion by ANZ Executors and Trustee Co Ltd as follows:

"SCHEDULE

1 Minutes of Meeting of the Australian Securities Commission

("ASC") on 7 January 1993 attended by Messrs Alan Cameron,

Charles Williams and Bill Robinson and each of the documents

referred to in those Minutes.

2 Instrument of Delegation dated 12 March 1991 in relation to

Peter Chapman, being the person occupying the position of

Director, Special Operations.

3 Agreement between Meadow Gem Pty Ltd and the ASC dated on or

about 18 March 1993.

4 Agreement between Hilton John and Patricia Mary Shaw and the

ASC dated on or about 18 March 1993.

5 Agreement between Neville and Betty Trewheela and the ASC

dated on or about 18 March 1993.

6 Minutes of Meeting of the ASC on 29 April 1993 attended by

Messrs Alan Cameron and Bill Robinson and each of the

documents referred to in those Minutes.

7 ASC staff paper dated 5 January 1993.

8 Resolution of the ASC made on 7 January 1993.

9 ASC staff paper dated 27 April 1993.

10 Any note, memorandum or record of the oral advice of Mr Neil

McPhee QC of 28 April 1993.

11 Written advice of Mr Robert Strong of Counsel dated 20 April

12 Instrument of Delegation dated 24 March 1993 in relation to

Peter Chapman and Ailsa Wilson being the persons

respectively occupying the positions of Director, Special

Investigations and Position No 1125.

13 Resolution of the ASC dated 29 April 1993.

14 Instrument of Delegation dated 24 March 1993 in relation to

Patrick Whitehouse being the person occupying the position

of Executive Director, Investigations.

15 Agreement between Gerald and Elizabeth Colman and the ASC

dated on or about 30 April 1993.

16 Agreement between Neil Woolcock and the ASC dated on or

about 30 April 1993.

17 Agreement between Mark Fairhall and the ASC dated on or

about 30 April 1993.

18 Agreement between Christopher Walter (as trustee of the

Walter Fashions Superannuation Fund) and the ASC dated on or

about 30 April 1993.

19 Agreement between John Thomas Walter and Eileen Yvonne

Walter, trustees of the Walter Fashion Superannuation Fund

and the ASC dated on or about 3 June 1993.

20 Minutes of Meeting of the ASC on 10 June 1993 attended by

Messrs Alan Cameron, Charles Williams and Bill Robinson and

each of the documents referred to in those Minutes.

21 Any note, memorandum or record of the oral advice from

Senior Counsel given on or before 10 June 1993 that there

was no proven basis for review of the decisions.

22 Resolution of the ASC made 10 June 1993.

23 Each document (other than a document listed above) that the

Applicant now has, or has had but does not now have, in its

possession, custody or power relating to any matter in

question between the Applicant and the Respondent in this

proceeding."

13. The Commission has given inspection to the applicants of all the documents included in that Schedule except items 7, 9, 10, 11, 20 and 21. Inspection of the minutes referred to in item 20 will be given to the applicants when the minutes have been prepared. The Commission claims privilege with respect to the other items just listed and these items correspond with the documents listed at the commencement of these reasons. The documents there described as 1 to 4, 7 and 8 were all listed in the further particulars of the defences of the Commission but the Commission claims privilege with respect to them, see O 15 r 11(1)(b), and says it is not required to produce those documents.

14. The Commission has filed affidavits claiming that the staff paper dated 5 January 1993 (Document 1), the staff paper dated 27 April 1993 (Document 2), the written advice of Mr Strong (Document 3) and the staff briefing paper dated 20 April 1993 (Document 4) were prepared by legal officers of the Commission or counsel as confidential professional communications between the Commission and its legal advisors in connection with the Supreme Court action or in anticipation of that action and the conduct of that action including the scope and operation of s50 of the ASC Law. There may be defects in the affidavits, but I am prepared to accept that the basis has been established with respect to a claim of privilege. In the circumstances, I am prepared to accept the same conclusion with respect to any written advice by Mr McPhee QC and any note or memorandum of oral advice given by Mr McPhee.

15. Before turning to consider the issue of privilege, some comments of a general nature are made. The applications are seeking to review decisions of the Commission made under s50 of the ASC Law. An unusual feature of that section is that it allows the Commission to expend public moneys in prosecuting actions in a court, here the Supreme Court, for the benefit of private persons, whether natural or incorporated. Before this can be done, it must appear to the Commission to be in the public interest for a person to begin and carry on a proceeding of the type specified. If that condition is satisfied, the proceedings may be begun and carried on in the person's name. Questions raised by the applications relate to the nature and extent of the decisions of the Commission with respect to the public interest, who controls the legal proceedings once begun, whether there can be a large number of persons joined as plaintiffs both initially and by addition, whether those persons can have any say in the conduct of the proceedings and a multiplicity of other matters. It is obvious that the applications raise many difficult and unusual issues arising essentially from the proper construction of the section. The unusual feature is that the decisions relate to matters with respect to proceedings in the Supreme Court of Victoria and not the Federal Court. As well, legal questions as to the nature and extent of the powers and obligations of the Commission arise. It is to be expected that in making its decisions the Commission would seek professional legal advice as to its powers and obligations and as to the anticipated legal proceedings in the Supreme Court. In this context it is not surprising that the Commission has claimed legal professional privilege with respect to information contained in documents prepared for the purpose of giving or receiving legal advice to the Commission.

16. The applicants do not dispute that the Commission has the benefit of legal professional privilege in relation to the information in the documents in dispute, see Waterford v The Commonwealth [1987] HCA 25; (1986-87) 163 CLR 54 per Mason and Wilson JJ at 63-4. They contend that the right to claim that privilege has been waived. The documents containing that advice are referred to in the further particulars. This suggests that the Commission, at the hearing of the applicant, will rely upon that advice. Further, in some cases, reference is made to the substance of the information contained in some of the documents.

17. The legal principles to be applied to cases of this kind are not in dispute. The application of those principles to the facts of any case can give rise to problems. The relevant principles are to be distinguished from the principles to be applied where part of a document contains information which is subject to privilege but other parts do not attract that privilege. In that case, it is permissible to mask the privileged parts to enable inspection of the parts which are not subject to privilege, see for example Waterford v Commonwealth.

18. A leading authority on the doctrine of legal professional privilege is Attorney-General for the Northern Territory v Maurice [1986] HCA 80; (1986) 161 CLR 475. At p487, Mason and Brennan JJ comment on the doctrine as follows:

"Legal professional privilege is an ancient doctrine which has

assumed a life of its own. Succinctly stated, the privilege

protects from disclosure "communications made confidentially

between a client and his legal adviser for the purpose of

obtaining or giving legal advice or assistance"; Reg. v Bell; Ex

parte Lees [1980] HCA 26; (1980) 146 CLR 141 at p144, per Gibbs J. The raison

d'etre of legal professional privilege is the furtherance of the

administration of justice through the fostering of trust and

candour in the relationship between lawyer and client. The

privilege is based on:

" ... the need of laymen for professional assistance in the

protection, enforcement or creation of their legal rights.

They should have the benefit of that assistance, free of any

restraint which fear of the disclosure of their

communications with those advisers would impose". (Reg. v

Bell (1980) 146 CLR at p152, per Stephen J)

When the privilege applies, it enables the client to keep the

communication from disclosure and interferes with the public's

"right to every man's evidence": Cobbett's Parliamentary History

(1812) vol 12 p675. Because of this conflict between the public

interest in ensuring the availability of all relevant evidence in

a particular case and the public interest in the administration of

justice through effective legal representation, the privilege is

confined within strict limits: Grant v Downs [1976] HCA 63; (1976) 135 CLR 674

at p685, per Stephen, Mason and Murphy JJ."

19. Their Honours then considered the doctrine of waiver at pp487-8:

"The limiting effect of legal professional privilege on the

availability of evidence otherwise relevant is confined, inter

alia, by the doctrine of waiver. A litigant can of course waive

his privilege directly through intentionally disclosing protected

material. He can also lose that protection through a waiver by

implication. 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. Professor Wigmore explains:

"(W)hen his conduct touches a certain point of disclosure,

fairness requires that his privilege shall cease whether he

intended that result or not. He cannot be allowed, after

disclosing as much as he pleases, to withhold the

remainder." (Wigmore, Evidence in Trials at Common Law

(1961) vol 8 par 2327 p636).

In order to ensure that the opposing litigant is not misled by an

inaccurate perception of the disclosed communication, fairness

will usually require that waiver as to one part of a protected

communication should result in waiver as to the rest of the

communication on that subject matter: see Great Atlantic

Insurance Co v Home Insurance Co (1981) 1 WLR 529.

Hence, the implied waiver inquiry is at bottom focused on the

fairness of imputing such a waiver."

20. The basis of the doctrine of legal professional privilege arises from an apparent conflict of general principles. This is made clear by Deane J at p490:

"It is a substantive general principle of the common law and not a

mere rule of evidence that, subject to defined qualifications and

exceptions, a person is entitled to preserve the confidentiality

of confidential statements and other materials which have been

made or brought into existence for the sole purpose of his or her

seeking or being furnished with legal advice by a practising

lawyer or for the sole purpose of preparing for existing or

contemplated judicial or quasi-judicial proceedings: see

generally, Baker v Campbell [1983] HCA 39; (1983) 153 CLR 52. That general

principle is of great importance to the protection and

preservation of the rights, dignity and freedom of the ordinary

citizen under the law and to the administration of justice and law

in that it advances and safeguards the availability of full and

unreserved communication between the citizen and his or her lawyer

and in that it is a precondition of the informed and competent

representation of the interests of the ordinary person before the

courts and tribunals of the land. Its efficacy as a bulwark

against tyranny and oppression depends upon the confidence of the

community that it will in fact be enforced. That being so, it is

not to be sacrificed even to promote the search for justice or

truth in the individual case or matter and extends to protect the

citizen from compulsory disclosure of protected communications or

materials to any court or to any tribunal or person with authority

to require the giving of information or the production of

documents or other materials, see Pearse v Pearse [1846] EngR 1195; (1846) 63 ER 950

at 957, Baker v Campbell (1983) 153 CLR at 115-116."

21. His Honour deals with the question of waiver at pp492-3. The qualification expressed at the end of this passage is of importance to the facts of this case:

"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. Thus, ordinary notions of fairness require that an

assertion of the effect of privileged material or disclosure of

part of its contents in the course of proceedings before a court

or quasi-judicial tribunal be treated as a waiver of any right to

resist scrutiny of the propriety of the use he has made of the

material by reliance upon legal professional privilege. There

are, however, no considerations of fairness which require that

compliance by a party with a procedural requirement that he

prepare and make available a document setting forth the case which

he proposes to make before a court or quasi-judicial tribunal

should be treated as a waiver of his right to claim legal

professional privilege in respect of all the material upon which

he has relied in the preparation of that document. If, in such a

document, a party sets forth part of the contents of a particular

identified document or communication or asserts the effect of or

his reliance upon a particular identified document or

communication, it may be that considerations of fairness might

require that he be treated as having waived any legal professional

privilege in relation to the whole document or communication: cf

Buttes Gas and Oil Co v Hammer (No 3) (1981) 1 QB 223 at pp251-252.

Where, however, he does no more than make use of privileged

material (eg legal advice, expert opinion or statements of

potential witnesses) for the purpose of formulating the statement

in such a document of the details of the case which he proposes to

make, it would be an affront to ordinary notions of fairness to

hold that the effect of his compliance with that procedural

requirement was that he has waived his legal professional

privilege in relation to such material."

22. The Chief Justice made reference to the same qualification. At p481 Gibbs CJ, after referring to a number of cases including Buttes Gas and Oil Co v Hammer (No 3), said:

"These cases may be explained by saying that it is not unfair or

misleading to refer to a document in a pleading or affidavit which

is not put into evidence but that if the document is set out in

full the privilege is waived. A fortiori, of course, privilege in

respect of materials used in drawing a pleading or an affidavit

and not referred to therein, would not lose their privilege

because they had been used in that way."

23. During the course of submissions, counsel for the applicants referred to many other authorities to support the same propositions or principles. These authorities included Great Atlantic Insurance Co v Home Insurance Co (1981) 2 All ER 485. There Templeman LJ said at p490:

"Counsel for the plaintiffs argued that severance is permissible

where the part disclosed is only an account of a discussion which

itself is not privileged. But, once it is decided that the

memorandum deals with only one subject matter, it seem to me that

it might be or appear dangerous or misleading to allow the

plaintiffs to disclose part of the memorandum and to assert

privilege over the remainder. In the present case the suspicions

of Heath which have not unnaturally been aroused by the disclosure

of only part of the memorandum can only be justified or allayed by

disclosing the whole. It would be undesirable for severance to be

allowed in these circumstances. In my judgment, the simplest,

safest and most straightforward rule is that if a document is

privileged then privilege must be asserted, if at all, to the

whole document unless the document deals with separate subject

matters so that the document can in effect be divided into two

separate and distinct documents each of which is complete."

24. At p493 His Lordship referred to what was said by Mustill J in Nea Karteria Maritime Co Ltd v Atlantic and Great Lakes Steamships Corpn 1978 unreported, namely:

"I believe that the principle underlying the rule of practice

exemplified by Burnell v British Transport Commission is that,

where a party is deploying in court material which would otherwise

be privileged, the opposite party and the court must have an

opportunity of satisfying themselves that what the party has

chosen to release from privilege represents the whole of the

material relevant to the issue in question. To allow an

individual item to be plucked out of context would be to risk

injustice through its real weight or meaning being misunderstood.

In my view, the same principle can be seen at work in George

Doland Ltd v Blackburn Robson Coates and Co in a rather different

context."

"I agree and would only add that it would not be satisfactory for

the court to decide that part of a privileged document can be

introduced without waiving privilege with regard to the other part

in the absence of informed argument to the contrary, and there can

be no informed argument without the disclosure, which would make

argument unnecessary."

Another case referred to by counsel for the applicants was Hongkong Bank of Australia Ltd v Murphy and Allen Supreme Court of Victoria, Smith J, 24 December 1992, unreported.

26. It is now necessary to turn to the facts relevant to the issues before the Court. By its further particulars of its defence, the Commission referred to and identified the large number of documents referred to earlier in these reasons. This was done because the request for the further particulars sought identification of the relevant documents relied upon by the Commission in reaching the decisions identified by the Commission and being challenged by the applicants. It would be expected from the unusual and complex matters being considered by the Commission that it would have sought legal professional advice. The applicants did not dispute that advice from qualified legal officers in the employ of the Commission constituted legal advice coming within the doctrine of the legal professional privilege of the Commission. In this context, it is not surprising that the documents disclosed and referred to in those further particulars included Documents No 1, No 2, No 3, No 4 and No 6, the subject of the claim of privilege. The fact that these documents were so included cannot, by itself, constitute a waiver of privilege, see Attorney-General for the Northern Territory v Maurice.

27. Counsel for the applicants went further. They contended that the way the Commission referred to these documents showed that the Commission had, by implication, waived the right to privilege. It is important to note at this stage that, where a claim to privilege is made at an interlocutory stage, the party making that claim cannot put that document in evidence at the trial without first giving the opposing party the opportunity to inspect that document, with the result that in an appropriate case the hearing may need to be adjourned at the cost of the party who, having claimed privilege, waives that privilege at the trial; see for example Buttes Gas and Oil Co v Hammer (No 3) above per Brightman LJ at 268:

"So far as waiver by pleading is concerned, I agree with the judge

that reference to a document or to its contents in a pleading does

not waive any legal professional privilege attached to it. It is

to my mind equally clear that a party cannot rely on a privileged

document so pleaded without thereby waiving the privilege.

Therefore sooner or alter Buttes will have to decide whether to

forego privilege in respect of a privileged document which is

pleaded, or to abandon reliance on it. If they sit on the fence

until the trial (if any) begins or is in actual progress, they

will do so at their own risk. Circumstances might arise in which

the other side could properly claim to be entitled to an

adjournment at Buttes' expense. Whether Occidental could force

Buttes to step down from the fence prior to the trial by an

application to strike out a pleaded document in respect of which

privilege is maintained does not arise for decision on this

appeal, but I would think that Occidental might be able to do

this."

"On waiver McNeill J held that reference in the pleadings to a

document or to its contents does not of itself waive any privilege

which attaches to it. It must be right that a bare reference to a

document in a pleading does not waive any privilege attaching to

it as otherwise there would be no scope for taking objection under

RSC, Ord 24 r 11(i), when a notice was served under rule 10(1).

If, on the other hand, a document is reproduced in full in the

pleading, its confidentiality is gone and no question of privilege

could arise. Where the line is drawn between these two extremes

may be a matter of some nicety, but I do not think that it is

necessary to reach a conclusion in the present case which does

not, in my judgment, turn on so narrow an issue as waiver in

relation to the few documents which are referred to in the

pleadings."

29. In the present case, in addition to the further particulars, counsel for the applicants sought support for their contentions by reference to the contents of some of the documents which the Commission produced for inspection by the applicants. I do not consider it necessary to refer in detail to those contents. I am satisfied that nothing in them assists in determining the issue of waiver with respect to the documents in issue.

30. As was said earlier in these reasons, a special aspect of these proceedings is that the applicants seek orders under the Judicial Review Act. Of necessity matters in issue will include material considered by the Commission in making the decisions being challenged. To some extent, it will be necessary for the Commission to decide whether it will rely upon the information contained in the documents for which privilege is claimed. The fact that those documents are referred to in the further particulars does not constitute waiver, but if, at a later stage, the Commission desires to rely on the information contained in those documents, it will face the problems referred to earlier. It cannot "sit on the fence" indefinitely.

31. In most instances, the further particulars merely identify the documents for which privilege is claimed. In one instance, however, the particulars go further. In relation to the meeting by the Commission held on 29 April 1993, the particulars disclose in part the contents of a document for which privilege is claimed. The relevant particular is that at the meeting the Commission:

"(e) considered the oral advice of Mr Neil McPhee of 28 April and

the written advice of Mr Robert Strong dated 20 April 1993

recommending that a further proceeding be issued in which

the plaintiffs would be the noteholders not involved in the

original proceeding." (Emphasis added).

32. In my opinion, this particular descends to disclosing part of the information contained in a document for which privilege is claimed. The question is whether this disclosure is sufficient to constitute a waiver by implication with respect to all the documents for which privilege is claimed, the specific document only or no waiver at all. This needs to be considered in accordance with the opinions expressed in Maurice and discussed earlier in these reasons.

33. In my opinion, there has been no waiver with respect to the documents identified as 1, 2, 4, 7 and 8. There has been no disclosure of any part of the information contained in any of those documents. Thus there is nothing upon which to apply the principles enunciated in Maurice. The form of the statement referred to in document 8 seems directed to an attempt by the respondents to induce the Commission to make a partial disclosure upon which those principles could apply. Thus, the motion by the applications for inspection brought under O 15 r 11(1)(b) with respect to documents 1, 2, 4, 7 and 8 is refused.

34. The information contained in document 3 comes within a different category. Included among the documents is the written advice of Mr Strong (of counsel) dated 20 April 1993. There has been part disclosure of the contents of that document which constitutes waiver, but the waiver is limited to those parts of the advice which relate to the decision to which the particular disclosure has been made. Other parts of the advice could be blocked out under the principle discussed in Waterford. Accordingly, a limited order will be made with respect to inspection of document 5. The Commission is to give inspection of the information in the written advice of Mr Strong dated 20 April 1993 insofar as that information relates to the decision that a further proceeding be issued in which the plaintiffs would be the noteholders not involved in the original proceedings.

35. It is necessary to consider the orders sought by the motions that the Commission give general discovery under O 15, see in particular r 5.

36. It must be remembered that the pleadings in these applications have not been completed. The applicants have been given leave to add respondents and to file and serve amended applications and amended particulars which are to be treated as statements of claim. The particulars contained in the original applications have been treated as statements of claim. The Commission has filed and served defences to those statements of claim. The defences have identified decisions which are being challenged. The commission has identified a large number of documents which it alleges are relevant to the decisions being challenged. The parties made their submissions on the basis that the motions can be determined on the relevant principles and will not be affected by the proposed amendments.

37. It must be remembered further that the facts giving rise to the applications are unusual. They have been set out earlier in these reasons. The applications seek orders of review in respect of decisions by the Commission to begin and carry on the Supreme Court action against the applicants as defendants. At the present stage of the proceedings, these decisions must be treated as decisions to which the Judicial Review Act apply. The Commission has not instituted any action to have the application struck out. Likewise, at the present time, no determination has been made on whether the Commission is required to give reasons for the decisions being challenged, see s13 of the Judicial Review Act. This is of no great importance since the right conferred upon an applicant to be given reasons does not, of itself, determine whether discovery should be given, see Federal Commissioner of Taxation v Nestle Australia Ltd [1986] FCA 368; (1986) 12 FCR 257 per Bowen CJ, Lockhart and Sheppard JJ at pp264-265. In that passage the Court made it clear that reasons under s13 and discovery are essentially different although the Court could, in the exercise of a discretion to order discovery, take into consideration the existence of the right to reasons under s13 of the Judicial Review Act. On the facts of these applications, attention will be directed to discovery separate from reasons under s13.

38. Under O 54 r 1, the Federal Court Rules apply to applications to the Court under the Judicial Review Act. The Court has a discretion to order a decision maker to give discovery. In the present case, the provisions of O 54 r 3 can have no application. The applicants had no clear statement of what decisions had been made by the Commissioner to begin and carry on the Supreme Court action. In the events that have happened, the applicants rely upon the decisions identified by the Commission in its defence. To a large extent, these decisions can be identified from a reading of s50 of the ASC Law and the evidence and interlocutory steps in the Supreme Court action. As was said by Wilcox J in Nestle Australia Ltd v Federal Commissioner of Taxation (1986) 10 FCR 78 at p82:

" ... there is no general principle or practice against permitting

discovery in proceedings brought under that Act; as was said by

Brennan J, with whom Bowen CJ agreed, in WA Pines Pty Ltd v

Bannerman [1980] FCA 79; (1980) 41 FLR 175 at 181 the proper exercise of the

power "depends upon the nature of the case and the stage of the

proceedings at which discovery is sought"."

A very helpful discussion on discovery in proceedings under the Judicial Review Act is given by Wilcox J in Nestle Australia Ltd at pp82-3. That passage is set out:

"There is a general principle against allowing discovery for the

purpose of "fishing", that is so as to allow a party who can

demonstrate nothing to support an allegation, access to the

documents of the opposing party in the hope of discovering some

such support. As is demonstrated by authorities referred to by

Lockhart J in W A Pines (supra) at 190-191, the principle evolved

in litigation between private citizens founded upon traditional

forms of action. It is perhaps debatable whether that principle

should be applied automatically to litigation between a citizen

and an agency of government in which the question is the

lawfulness of a decision made by government which adversely

affects his interests. Some may consider that it would be in

accordance with the concept of open government that a person

challenging such a decision ought to have access to the relevant

file, subject to proper exceptions in relation to privileged

documents, in order to ascertain whether his or her case has been

handled according to law; otherwise, it may be said, in the very

case where discovery is most needed - because there is no other

available evidence of legal error - it will be unavailable.

However this may be, upon at least two occasions Full Courts of

this Court have applied the "anti-fishing" principle against

applicants seeking relief under the Administrative Decisions

(Judicial Review) Act 1977: see W A Pines (supra) at 182, 190-191

and Lloyd v Costigan (1983) 62 ALR 284. In the latter case the

Full Court (Bowen CJ, Morling and Fitzgerald JJ) said at 292:

"There is much to be said for the view that it is not open

to a party simply to allege that a decision was made without

basis and then to seek to use the process of the court to

attempt to make out a case and indeed to find out if his

allegation has any foundation ... "

There is little discussion in the authorities as to what must be

demonstrated by an applicant for review in order to avoid the

stigma of "fishing". It would be absurd to require that the

applicant demonstrate a prima facie case of legal error; otherwise

discovery would be available only when unnecessary. It is clear

that there should at least be sufficient definition of the issues

to enable it to be seen that the documents relate to a live issue

in the case (cf Murchison v Keating [1984] FCA 125; (1984) 1 FCR 341 at 344-345),

but W A Pines suggests that this is not enough. In the latter

case Brennan J, at 181, referred to cases in which "sufficient is

shown to ground a suspicion that the party applying for discovery

has a good case proof of which is likely to be aided by

discovery". In Reid v Nairn (unreported, 25 March 1985) Fisher J

allowed discovery only after finding "some evidence which could

support an arguable case for review of the decision" under

challenge. In that case his Honour limited discovery to documents

relating to those aspects of the case which appeared to be

vulnerable to attack."

39. In the present applications, counsel for the Commission contended that the Commission has made discovery of the relevant documents, being those referred to in the further particulars of the defences filed by the Commissioner. They contended that the applicants were engaging in a fishing expedition and that discovery should be denied.

40. Counsel for the applicants disputed that contention. They contended there were at least six separate matters of substance arising between the parties most of which in reality concern the proper construction of s50 of the ASC Law. The first issue was said to be whether s50 was in substance a class action. There was an issue of fact of whether the Commission had examined the merits of the claim by each individual potential plaintiff. This was the second issue. Third was the issue of fact of whether the Commission gave consideration to the financial means of the individual potential plaintiffs in circumstances where the plaintiffs' costs were to be paid from public moneys. The fourth issue related to the arguments between the Commission and the potential plaintiffs under which a plaintiff had no entitlement to withdraw from the action. The fifth issue concerns the power of the Commission to apportion any damages awarded as between the plaintiffs. The sixth issue arises from a possible conflict between the Supreme Court rules and the nature of the proceedings brought by the Commission. This relates to the procedural difficulties arising from the large number (possibly over 1000) of plaintiffs in the one action.

41. The applicants then argued that the Commission has raised factual matters by way of defence to the applications for the orders of review and therefore the applicants cannot be said to be fishing in seeking discovery of documents relevant to those issues. The fact of the Commission purporting to rectify the decisions of the delegates of the Commission, itself, so it was contended, supported the view that the factual matters may be of importance and denies the accusation of fishing.

42. This is a border line case in relation to discovery and fishing. As said earlier, the legislation is unusual. The Supreme Court action was commenced. The applicants seek to bring these proceedings to an end. To do this, they seek to challenge the exercise of the power conferred upon the Commission by s50 of the ASC Law. To support the application, reliance is placed upon the unusual features of s50 and of the Judicial Review Act. The Commission, to some extent in an attempt to clarify the issues, has filed defences and given particulars. The applicants then refer to the particulars and the documents identified in the pleadings to justify discovery being ordered. The Commission is an agency or authority of the Commonwealth in administering a law of the Commonwealth. It will be for the Supreme Court to hear and determine the Supreme Court action. A large number of documents have been inspected under O 15 r 11. There has been no affidavit filed on behalf of the Commission stating that no other relevant document is or has been in the possession or custody of the Commission. At the same time it might be oppressive for the Commission to be required to refer to and identify every source document used in the obtaining of reports; c/f Maurice. Further, having descended into discovering some documents, it seems only fair that it should make full disclosure.

43. In all circumstances, in my opinion, the applicants are not fishing and are entitled to full discovery. It is undesirable that construction of a difficult section of a statute should be undertaken in the absence of facts found. The policy of the Judicial Review Act supports this view, and, on the facts of this case, the applicants should be able to ascertain the facts upon which those decisions have been made when those decisions can adversely affect the rights of persons who were not before the agency or authority of the Commonwealth involved and thus had no knowledge of the matters considered by the agency or authority. Orders for discovery will be made.

44. At the same time, because of the importance of the issues raised, and their effect on the future of this litigation, the parties have leave to appeal from the interlocutory orders made on these motions.