INPEX Operations Australia Pty Ltd v AkzoNobel NV

Sub-area: Regulator and Consumer Protection

Number of paragraphs: 101

Date of hearing: 22 July 2024

Counsel for the Applicants: Ms H Lenigas

Solicitor for the Applicants: Corrs Chambers Westgarth

Counsel for the Respondents: Mr MJ Sims SC

Solicitor for the Respondents: Clayton Utz

Counsel for the Cross-Claimants: Mr MJ Sims SC

Solicitor for the Cross-Claimants: Clayton Utz

Counsel for the First and Second Cross-Respondents: Ms H Lenigas

Solicitor for the First and Second Cross-Respondents: Corrs Chambers Westgarth

Counsel for the Third Cross-Respondent: The third cross-respondent did not appear

BETWEEN: INPEX OPERATIONS AUSTRALIA PTY LTD First Applicant

AND: AKZONOBEL NV First Respondent

INTERNATIONAL PAINT LIMITED Second Respondent

AKZO NOBEL PTY LIMITED Third Respondent

AND BETWEEN: AKZONOBEL NV First Cross-Claimant INTERNATIONAL PAINT LIMITED Second Cross-Claimant AKZO NOBEL PTY LIMITED Third Cross-Claimant

AND: INPEX OPERATIONS AUSTRALIA PTY LTD First Cross-Respondent ICHTHYS LNG PTY LTD Second Cross-Respondent JKC AUSTRALIA LNG PTY LTD Third Cross-Respondent

order made by: BANKS-SMITH J DATE OF ORDER: 24 july 2024

1. The respondents' application to inspect the documents produced in response to the notice to produce (notice to produce dated 24 May 2024) addressed to the applicants is refused.
2. Costs reserved. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

BANKS-SMITH J: 1 This action, referred to as the INPEX action, is being heard concurrently with WAD 448 of 2017, referred to as the JKC action. The respondents in both actions are referred to as ANIP. The trial commenced on 18 June 2024 and is underway. 2 In the proceedings before me, each of INPEX and JKC pursue ANIP in relation to the supply and use of a coating product known as Intertherm 228 (I228) on piping and equipment used in the Ichthys LNG Gas Field Onshore Project at Bladin Point, Darwin. The I228 has degraded. 3 ANIP has served a Notice to produce on INPEX seeking copies of instructions and briefing materials said to have been given by Allen & Overy (A&O) in 2017 and 2018 to two technical scientific experts, Mr Bryan McCormick and Mr Peter Moore, both of Minton, Treharne and Davies Ltd (MTD). Mr McCormick is a senior consultant scientist at MTD. Mr Moore is the technical director of materials science at MTD. 4 Those experts were subsequently retained by Corrs Chambers Westgarth to provide expert reports for this proceeding. Mr McCormick and Mr Moore are due to give technical evidence in week eight of the trial. 5 Each of Mr McCormick and Mr Moore have prepared a number of reports, but their primary reports are those dated 12 May 2023 (Mr McCormick) and 16 May 2023 (Mr Moore). I will refer to those two reports for convenience as the Expert Reports. For the purposes of this application ANIP referred in particular to Mr Moore's report of 16 May 2023. 6 The Notice seeks production of: Documents (including letters and emails) constituting or recording: a. instructions to; and b. materials briefed to, Mr Peter Moore and Mr Bryan McCormick (or either of them) in relation to their attendances at the Ichthys Onshore LNG Plant in 2017 and 2018, as referred to in paragraphs 3.3, 13.1 and 13.2 of the expert report of Peter Moore dated 16 May 2023. 7 INPEX has produced the documents said to be encompassed by the Notice (Documents) but resists their inspection by ANIP on the basis that they contain communications that are privileged. ANIP seeks orders that INPEX make the Documents available for inspection. 8 I have not inspected the Documents, and although the possibility of inspection was raised, the position of the parties was that it was not necessary that I (or another judge) should do so in order to determine the application.

Summary of respective arguments 9 ANIP accepts that up until the time of service of the Expert Reports, the Documents were the subject of legal professional privilege. However, it contends that the Documents 'have influenced, and are necessary for [ANIP] to completely understand, the reports'. ANIP asserts that privilege is therefore impliedly waived, and the Court should grant ANIP leave to inspect, referring to ML Ubase Holdings Co Ltd v Trigem Computer Inc [2007] NSWSC 859; (2007) 69 NSWLR 577 at [37] (Brereton J). It submitted that it is unfair and inconsistent with the maintenance of privilege for INPEX to rely on the reports without disclosure of such associated documents, including instructions to the expert, referring to Australian Securities and Investments Commission v Southcorp Ltd [2003] FCA 804 at [21] (Lindgren J). 10 ANIP also refers to the obligations that arise from r 23.11 of the Federal Court Rules 2011 (Cth) (calling expert evidence at trial), r 23.13(h) (an expert report must comply with the Federal Court's Expert Evidence Practice Note) and the terms of the Practice Note in support of their submissions. 11 INPEX submits that merely because instructions from A&O are referred to in the Expert Reports, it does not follow that INPEX has waived legal professional privilege over the Documents. It says that the Documents did not influence the content of the Expert Reports and that there are no communications with A&O which have not been disclosed to ANIP upon which the opinions of Mr Moore and Mr McCormick were based.

The Corrs instructions 12 No inspection issue arises in this application as to the instructions given by Corrs to MTD. Written instructions dated 12 July 2022 from Corrs to MTD are annexed to the Expert Reports. A number of subsequent supplementary instructions from Corrs were also annexed. Those Expert Reports have been filed and served for the purpose of this trial and INPEX does not maintain any privilege claim in relation to those instructions.

The A&O instructions 13 Mr McCormick and Mr Moore disclose in their Expert Reports that they had previously attended at the Project site in 2017 and 2018 pursuant to separate instructions given to them by A&O on behalf of INPEX. For completeness I extract the relevant paragraphs from Mr Moore's report, cited in the Notice: [3.3] We had previously attended at the Plant in 2017 and 2018, pursuant to separate instructions from INPEX's advisers. … [13.1] In 2017 Mr McCormick and I attended on Site, during construction, from the 27th of July through to the 1st of August. [13.2] In 2018 Mr McCormick and I attended on Site from the 20th through to the 27th of September; the Plant was undergoing commissioning at this time. 14 The Expert Reports provide details about the 2017 and 2018 visits and the work undertaken during them, to which I will return. 15 In order to explain the basis upon which privilege is asserted over the Documents, INPEX relies on affidavits provided by two partners of A&O, Mr Mark van Brakel and Mr David Jenaway. A&O is now known as Allen Overy Shearman Sterling (AOSS). 16 The proceedings before me are only two of a number of claims pursued by way of arbitrations and separate litigation, arising out of the development and construction of the Project. 17 Separately, arbitrations and proceedings have ensued between INPEX and JKC. In that context, A&O has acted and AOSS continues to act for INPEX. Relevantly, since around 2017 A&O acted for INPEX in relation to disputes arising out certain construction works the subject of the EPC Contract made between INPEX and JKC. Those works are also the subject of various contracts of insurance. 18 In particular, Mr van Brakel and Mr Jenaway have provided legal services to INPEX in relation to what they call the P&I Matters. 19 They explain that the P&I Matters include contentious issues as to corrosion occurring on areas of the Project that have been coated with I228, and performance failures of insulation systems known as Flexible Elastomeric Foam and Mineral Wool. 20 Mr van Brakel deposed that from the time he started to read into the P&I Matters in April-May 2017 he anticipated that there was a high likelihood of arbitration or other legal proceedings being commenced, given the high value of the anticipated costs of rectification works and the fact that there were ongoing disputes as to liability for those costs, both between INPEX and JKC and under the various contracts of insurance. 21 Mr van Brakel explained that a number of arbitrations were subsequently commenced between 30 July 2018 and 14 January 2019. A&O (together with the firm White & Case) acted for INPEX in the arbitrations. An Award was made in one, and the remaining arbitrations were subsequently terminated following a settlement between INPEX and JKC. 22 Mr van Brakel also explained that A&O's legal services from around 2017 included advising upon the coverage provided by the policies of insurance and the conduct of INPEX's assertion of rights under those policies, and to prepare for the conduct of disputes and anticipated legal proceedings with the insurers. 23 It is a matter of public record (and discussed in my reasons in JKC Australia LNG Pty Ltd v AkzoNobel NV (No 5) [2023] FCA 1248), that in May and July 2020 INPEX and JKC respectively filed proceedings in the Supreme Court of Western Australia in respect of rights asserted under certain insurance policies that relate to the P&I Matters. JKC is no longer a party to those proceedings. 24 Important to this application is Mr van Brakel's role in securing the services of MTD to assist A&O in providing legal services to INPEX. In particular, Mr Moore and Mr McCormick of MTD provided assistance. 25 Mr van Brakel attached a list of documents to his affidavit (MVB-01). The six documents listed in MVB-01 are said to have been produced by INPEX in response to the Notice. They are described as emails on dates during July 2017 and August 2017 and between A&O and MTD, with one communication between A&O, MTD and INPEX. 26 Mr van Brakel stated the following in his affidavit: 21 When I commenced work on the P&I Matters in April 2017, I identified that the legal issues depended upon technical issues, including in relation to the cause and nature of failures that had been observed. I formed the view that for A&O to advise INPEX on the legal merits of the dispute, and for A&O to conduct any arbitration or other legal proceeding commenced in the future, independent technical expertise was required. In those circumstances, a scientific consultancy firm called Minton, Treharne & Davis (MTD) was identified by A&O in April 2017 as having individuals with appropriate expertise and experience to act as independent experts, namely Peter Moore and Bryan McCormick. 22 From April 2017, I and other lawyers under my supervision, commenced communicating with Mr Moore and Mr McCormick of MTD on a confidential basis about the P&I Matters. My only purpose in arranging for and conducting these communications with MTD was to obtain the technical input that I considered was needed for the giving of legal advice, and for the provision of legal services comprising conduct of the disputes and preparation for future arbitration or legal proceedings by A&O on behalf of INPEX. In relation to anticipated proceedings, I considered it appropriate to secure persons who could act as independent expert witnesses in any arbitration or other legal proceedings that occurred in the future. I am not aware of there being any other purpose to the communications between A&O and MTD. INPEX claims privilege over all of those communications. 23 For the same purpose, I considered it would be beneficial for Mr Moore and Mr McCormick to attend the site of the EPC Works at Bladin Point, Darwin to inspect the issues on which I required their technical input. Under my supervision, A&O lawyers arranged for an inspection to take place on or around 27 July to 1 August 2017. A further inspection was arranged by A&O in the period 20 to 27 September 2018, a few months after the commencement of the Article 67 Arbitration. Mr Jenaway had primary carriage of the P&I Matters at that time. 24 I have read each of the documents listed in MVB-01 I confirm that each document comprises a confidential communication between lawyers of A&O working under my supervision, and Mr Moore and Mr McCormick of MTD. The sole purpose of each communication was the purpose I identify at paragraph 22 above. 27 Mr van Brakel had primary responsibility for the P&I Matters until May 2018, when Mr Jenaway was promoted to partner. From that time Mr Jenaway had primary responsibility for the P&I Matters. Mr Jenaway had worked on those matters as part of the A&O legal team since September 2017. 28 Mr Jenaway's evidence as to the nature of the P&I Matters and A&O's role was consistent with that of Mr van Brakel. 29 Mr Jenaway annexed a list of documents to his affidavit (DAJ-01), being a list of documents produced by INPEX in response to the Notice. The list refers to five emails (one being an attachment to another). They are dated between 31 July 2018 and 3 October 2018 and are identified as being from A&O to MTD. 30 Mr Jenaway also referred to the various arbitrations and the Supreme Court insurance proceedings. In particular he referred to the 'Article 67 Arbitration', noting that he was the A&O partner primarily responsible for the conduct of this arbitration, which dealt with numerous disputes arising from the EPC Works. 31 When Mr Jenaway commenced work on the P&I matters, Mr Moore and Mr McCormick were already assisting A&O. Mr Jenaway stated the following in his affidavit: 24 From May 2018, when I become the partner with primary responsibility for the P&I Matters, I and other lawyers under my supervision communicated with Mr Moore and Mr McCormick on a confidential basis about the P&I Matters. 25 My only purpose in conducting these communications with MTD was to obtain the technical input that I considered was needed for A&O to provide legal advice and legal services to INPEX in relation to the P&I matters. 26 I am not aware of there being any other purpose to the communications between A&O and MTD. INPEX claims privilege over all of those communications. 27 I was aware from my role on the P&I Matters that A&O had arranged for MTD to attend an inspection of the Project at Bladin Point in about mid-2017. 28 Mr Moore and Mr McCormick attended site in September 2018 (which was a few months after the commencement of the Article 67 Arbitration). This inspection was arranged by me and other A&O lawyers under my supervision. My purpose in arranging this visit was so that Mr Moore and Mr McCormick could inspect the issues on which I required their technical input in relation to A&O's ongoing provision of legal services to INPEX in relation to the P&I Matters. 32 It is apparent from this evidence that save for any waiver, the Documents on their face are the subject of legal professional privilege. It is also apparent that the P&I Matters remain subject to other ongoing litigation involving INPEX, including the proceedings in the Supreme Court. 33 In addition to the affidavits of Mr van Brakel and Mr Jenaway, INPEX relies on an affidavit of Mr Callum Strike, a partner of Corrs who with his colleagues has primary responsibility for this proceeding on behalf of INPEX. 34 Mr Strike annexed to his affidavit copies of a letter he sent to each of Mr Moore and Mr McCormick on 17 July 2024 and their respective responses, dated 18 July 2024. 35 Relevantly, Mr Strike asked the following questions of Mr Moore: In your Report dated 16 May 2023, you refer to your attendances with Mr McCormick at the site in 2017 and 2018. Can you please answer the following questions about those attendances: 1. Who selected the locations for sampling; e.g. were they selected by you and Mr McCormick, Allen & Overy, INPEX or someone else? 2. What is the 'work' you refer to in [16.3] and [16.5]? 3. Does your Report identify all the samples obtained by you and Mr McCormick? 4. Can you please confirm whether your experts report identifies all of the material and assumptions you have relied upon in forming the opinions expressed. 36 For context, [16.3] and [16.5] of Mr Moore's report are reproduced as part of an extract at [80] below. 37 Mr Moore responded to the effect that the locations for sampling were chosen by himself and Mr McCormick, subject to safety and access constraints, and were not chosen by INPEX, A&O or any other parties; that the reference to 'work conducted in 2017' and 'work conducted in 2017 and 2018' in [16.3] and [16.5] respectively of his report refers to technical work that he performed with Mr McCormick, being inspection, sampling and subsequent laboratory work; that the report, in itemised appendices, identifies all the samples that were taken; that a further sample of I228 coated steelwork was supplied to them by INPEX in September 2017 as is also disclosed in the report; and that the report identifies all the materials and assumptions upon which he relied in forming the opinions expressed. 38 Mr McCormick similarly confirmed that his report identifies all the material and assumptions he relied upon in forming the opinions expressed.

General principles - nature of the privilege claimed and the public interest 39 As is well recognised, legal professional privilege may take two forms - advice privilege or litigation privilege. It is apparent from the evidence of both Mr van Brakel and Mr Jenaway that INPEX claims both advice privilege and litigation privilege over the documents. 40 The nature of legal professional privilege was confirmed by the High Court in Glencore International AG v Commissioner of Taxation [2019] HCA 26; (2019) 265 CLR 646 as follows: [21] Legal professional privilege has been described as a right which is fundamental to persons and to our legal system. It has also been described as 'a practical guarantee of fundamental, constitutional or human rights'. Such descriptions point up the importance of the privilege. They serve to show that it is not merely an aspect of curial procedure or a mere rule of evidence but a substantive right founded upon a matter of public interest. The same distinction has been drawn in New Zealand and the United Kingdom. [22] What cannot be discerned from these cases is that the 'right' spoken of in connection with the privilege is an actionable right. If one asks what this 'right' gives to a person, the answer could be stated as 'a right to resist the compulsory disclosure of information' or 'the right to decline to disclose or to allow to be disclosed the confidential communication or document in question', as the Privy Council and the House of Lords respectively have held. So understood it is a freedom from the exercise of legal power or control, which is to say an immunity, and that is what Daniels Corporation held its true character to be. [23] In Daniels Corporation Gleeson CJ, Gaudron, Gummow and Hayne JJ, having observed that it is now settled that legal professional privilege is a rule of substantive law and not merely a rule of evidence, made the statement referred to earlier in these reasons that: 'It is an important common law right or, perhaps more accurately, an important common law immunity.' [24] McHugh J likewise described it as 'a person's immunity from compulsion to produce documents that evidence confidential communications about legal matters' between lawyers and clients. (footnotes omitted) 41 The High Court, having previously referred to The Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission [2002] HCA 49; (2002) 213 CLR 543, Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501, and Carter v The Managing Partner, Northmore Hale Davy & Leake (1995) 183 CLR 121, continued: [26] The statements in Daniels Corporation accord with what Gummow J had said in Propend. His Honour described legal professional privilege as 'a bar to compulsory process for the obtaining of evidence'. In his Honour's view, the privilege is 'not to be characterised as a rule of law conferring individual rights, breach of which gives rise to an action on the case for damages, or an apprehended or continued breach of which may be restrained by injunction'. And they accord with the view expressed by Brennan J in Carter, that the justification for the privilege is not to be found in the enforcement of some private right, but rather in the public interest. (footnotes omitted) 42 The public interest referred to in that paragraph of Glencore International AG was subsequently described at [27] as the enhancement of the administration of justice by facilitating the representation of clients by legal advisers (citing Grant v Downs (1976) 135 CLR 674 at 685). That public interest was said to be paramount to the more general public interest which requires the production of evidence for the purpose of litigation (at [29]). 43 Having regard to these matters, a question of implied waiver should always be resolved carefully.

Principles - waiver and instructions to experts 44 The present application relates to the response to a notice to produce. It is governed by the common law, and not by Part 3.10 (Privileges) of the Evidence Act 1995 (Cth): Esso Australia Resources Limited v Commissioner of Taxation [1999] HCA 67; (1999) 201 CLR 49 at [18]-[28]; Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1 at [27]. So much was accepted by senior counsel for ANIP at the hearing. 45 The basic principle, laid down in Mann v Carnell at [29] (Gleeson CJ, Gaudron, Gummow and Callinan JJ), is as follows: Disputes as to implied waiver usually arise from the need to decide whether particular conduct is inconsistent with the maintenance of the confidentiality which the privilege is intended to protect. When an affirmative answer is given to such a question, it is sometimes said that waiver is 'imputed by operation of law'. This means that the law recognises the inconsistency and determines its consequences, even though such consequences may not reflect the subjective intention of the party who has lost the privilege. … What brings about the waiver is the inconsistency, which the courts, where necessary informed by considerations of fairness, perceive, between the conduct of the client and maintenance of the confidentiality; not some overriding principle of fairness operating at large. 46 Accordingly, after Mann v Carnell, the determining factor is the identified inconsistency, although fairness remains a relevant consideration in the assessment of inconsistency: DSE (Holdings) Pty Limited v Intertan Inc [2003] FCA 384; (2003) 127 FCR 499 at [14]. 47 In Osland v Secretary, Department of Justice [2008] HCA 37; (2008) 234 CLR 275 at [45] (Gleeson CJ, Gummow, Heydon and Kiefel JJ) it was observed that deciding whether or not there has been an implied waiver of privilege: … reflects a judgment that the conduct of the party entitled to the privilege is inconsistent with the maintenance of the confidentiality which the privilege is intended to protect. Such a judgment is to be made in the context and circumstances of the case, and in the light of any considerations of fairness arising from that context or those circumstances. 48 Their Honours approved at [49] a statement by Tamberlin J in Nine Films & Television Pty Ltd v Ninox Television Limited [2005] FCA 356 at [26] that 'questions of waiver are matters of fact and degree'. 49 However, in the context of experts' reports, further guidance can be found in a line of authorities that have expressly considered whether waiver of privilege over an expert report which is deployed in litigation extends to other privileged communications that might be directly or contextually linked to the report. 50 In Southcorp Lindgren J listed a number of common law principles relevant to this issue. His Honour said at [21]: I will apply the following principles which I did not understand to be in dispute: 1. Ordinarily the confidential briefing or instructing by a prospective litigant's lawyers of an expert to provide a report of his or her opinion to be used in the anticipated litigation attracts client legal privilege: cf Wheeler v Le Marchant (1881) 17 ChD 675; Trade Practices Commission v Sterling (1979) 36 FLR 244 at 246; Interchase Corporation Ltd (in liq) v Grosvenor Hill (Queensland) Pty Ltd (No 1) [1999] 1 Qd R 141 ('Interchase') at 151 per Pincus JA, at 160 per Thomas J. 2. Copies of documents, whether the originals are privileged or not, where the copies were made for the purpose of forming part of confidential communications between the client's lawyers and the expert witness, ordinarily attract the privilege: Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501 ('Propend'); Interchase, per Pincus JA; Spassked Pty Ltd v Commissioner of Taxation (No 4) (2002) 50 ATR 70 at [17]. … 4. Ordinarily disclosure of the expert's report for the purpose of reliance on it in the litigation will result in an implied waiver of the privilege in respect of the brief or instructions or documents referred to in (1) and (2) above, at least if the appropriate inference to be drawn is that they were used in a way that could be said to influence the content of the report, because, in these circumstances, it would be unfair for the client to rely on the report without disclosure of the brief, instructions or documents; cf Attorney-General (NT) v Maurice (1986) 161 CLR 475 at 481 per Gibbs CJ, 487-488 per Mason and Brennan JJ, 492-493 per Deane J, 497-498 per Dawson J; Goldberg v Ng (1995) 185 CLR 83 at 98 per Deane, Dawson and Gaudron JJ, 109 per Toohey J; Instant Colour Pty Ltd v Canon Australia Pty Ltd [1995] FCA 870; Australian Competition and Consumer Commission v Lux Pty Ltd [2003] FCA 89 ('ACCC v Lux') at [46]. 51 In Watkins v State of Queensland [2007] QCA 430; [2008] 1 Qd R 564, Keane JA (with whom Mackenzie J agreed) said at [55]: It must be said, however, that the broad proposition that waiver will be imputed to ensure equality of advantage would mean that, in every case where an expert report is based on instructions as to the factual basis on which expert opinion is sought and the report is relied upon by the party that commissioned it in relation to the negotiation of a legal claim, the other party would have 'a right' to see those instructions. There are reasons of principle and authority why I am unable to accept that broad proposition. In terms of principle, it seems to be inconsistent with the High Court's insistence upon the substantive nature of the right to confidentiality involved in legal professional privilege, [Baker v Campbell (1983) 153 CLR 52; Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission (2002) 213 CLR 543 at 552 [9]] that the right can be treated as so fragile as to be susceptible of abrogation in consequence of a judicial impression that the other party would be better informed than he or she might be if the confidential information were not provided. It is in the nature of things that a party who enjoys a right to keep information relevant to a forensic contest confidential will also enjoy an advantage over that party's opponent: the mere existence of that advantage cannot be a reason for the abrogation of the right. It is the abuse of the right by conduct apt to confuse or deceive the opponent which is the basis for an imputed waiver of privilege. 52 In New Cap Reinsurance Corporation Ltd (In Liq) v Renaissance Reinsurance Ltd [2007] NSWSC 258 White J addressed the position in the context of the relevant discovery rule and s 122 of the Evidence Act 1995 (Cth) but acknowledged the significance of the qualification in [21(4)] of Southcorp. His Honour said at [45]: The qualification in paragraph 4 of Lindgren J's statement of principles set out in Australian Securities and Investments Commission v Southcorp Ltd is significant. There are many cases in which it has been held that privilege in material provided to an expert is not lost merely because the expert is called, or the expert's report is served. In Bourns Inc v Raychem Corporation [1999] 3 All ER 154, Aldous LJ said (at 166-167): 'Service of a witness statement, whether it be a statement of an expert or a witness to fact, waives privilege in that statement. As stated in the Marubeni Corp case mere reference to a document does not waive privilege in that document: there must at least be reference to the contents and reliance. In the present case there was no reference and no reliance therefore no waiver.' 53 His Honour then cited the reasons of Foster J in in Dingwall v Commonwealth of Australia (1992) 39 FCR 521. Foster J, referring to Attorney-General (NT) v Maurice (1986) 161 CLR 475, said at 524: I have come to the view, upon a close consideration of the judgments in Maurice's case that it cannot be regarded as authority for a wide principle that, whenever documents are sent to a potential witness as part of material being placed before him in order that he may provide a report of an expert kind to be used as evidence in a case, that those documents, ipso facto, although they had the protection of legal professional privilege, necessarily would lose it because of the doctrine of waiver. Maurice's case does not go as far as that. It requires, certainly, that there be an indication that the documents were used in the preparation of the evidentiary document in a way that could be said to influence the content of that document. 54 In Dingwall, a proposed medical witness was subpoenaed to produce all letters of instruction and related documents upon which his report had been prepared. Although the issue arose pre-trial, Foster J considered it as if the report had been received in evidence. The doctor said, and his Honour accepted, that the opinions expressed in his report had not been founded upon any information conveyed by the instructions or other subpoenaed documents. On that basis, his Honour concluded that the privilege in the letter of instructions and other documents had not been waived by the (assumed) tender of the expert report: there was no indication that they had been used in the preparation of the report in a way that could be said to have influenced its content. 55 White J in New Cap acknowledged the potential difficulty of assessing whether the contents of a privileged document have influenced the content of an expert's report, stating at [48]: It may be said that the question of whether such privileged documents influenced the content of the expert's report is a matter which the opposite party should be entitled to test. However, questions of privilege inevitably involve the striking of a balance. 56 Similarly, in Watkins, Keane JA (with whom Mackenzie J agreed) said at [55]: It is in the nature of things that a party who enjoys a right to keep information relevant to a forensic contest confidential will also enjoy an advantage over that party's opponent: the mere existence of that advantage cannot be a reason for the abrogation of the right. 57 The task of assessing whether the content of a privileged document has influenced the contents of an expert's report is one that can be undertaken by reference to (relevantly) the expert's report, despite the difficulties such a task may present. An example is provided by Fairhead v West Australian Newspapers Ltd [No 2] [2015] WASC 368 at [20] (Kenneth Martin J). 58 In this context, another matter relevant to the question is the obligation (for example by way of the Harmonised Expert Witness Code of Conduct) that an expert state, specify or provide 'the assumptions and material facts on which each opinion expressed in the report is based [a letter of instructions may be annexed]'. 59 In New Cap, White J said at [53]: The question is not merely whether it could be said that the privileged materials were used in such a way that they could be said to influence the content of the report, but whether it could be said that they influenced the content of the report in such a way that the use or service of the report would be inconsistent with maintaining the privilege in those materials, such as, where it would be unfair for the party to rely on the report without disclosure of those materials. Where an expert's report is submitted to a party's legal advisers so as to be put into a form which will ensure that it is admissible, it can be said that the privileged communications between the expert and the lawyers have influenced the content of the report, in the sense of its form, although not in the sense of the formulation of the substantive opinions expressed by the expert. Likewise, privileged communications between an expert and the party's lawyers whereby material information is provided to the expert in the form of assumptions or documents may well influence the content of the report. However, an expert's report is required to state what material and assumptions are relied on. Use of a final report, which refers to such materials and assumptions, is not inconsistent with maintaining confidentiality in the communications which produced the final product. 60 I also note in this regard the observation of Doyle CJ in Cole v Dyer [1999] SASC 272; (1999) 74 SASR 216 at [56]: A rule that privilege is waived if material is submitted to an expert for use in connection with an expert report, would be a very substantial intrusion on legal professional privilege. And such an intrusion would be for little gain, in terms of justice or efficiency, if particulars of any matter relied upon by the expert must be provided. The party to whom the report is disclosed will be able to identify privileged material upon which the expert has based the expert's opinion. 61 A number of authorities have considered the relevance of a statement by the expert to the effect that they have not relied on the privileged information in a manner that has influenced their report. Dingwall is one example. Another example, upon which ANIP relied and where there was a different outcome, is Westgem Investments Pty Ltd v Commonwealth Bank of Australia Ltd [No 2] [2018] WASC 71, in which Tottle J stated at [25]: Fifth, I have reservations about determining questions of waiver by reference to statements made by an expert as to whether the expert relied on the content of privileged material for the purpose of forming opinions or whether the privileged material influenced the content of the report. There is potential unfairness in this approach. It denies the cross-examiner the opportunity to test the expert's opinion by exploring whether the expert was wrong to disregard the material upon which he or she says no reliance was placed or which had no influence on the formation of the relevant opinion. Further in my view there is inherent unfairness in taking a witness's own statement as to what he or she relied upon in forming opinions or as to what may have influenced the formation of those opinions as the criterion by reference to which waiver is determined when such statements cannot be tested properly without resort to the privileged materials. 62 It has also been observed that there is no obligation to disclose matters on which the opinion expressed in a report is not based: Finance & Guarantee Co Pty Ltd v Auswild (Expert Evidence Ruling) [2019] VSC 665; (2019) 59 VR 288 at [39]. 63 Finally, I turn to ANIP's submission based on r 23.13(h) of the Federal Court Rules to the effect that an expert report must comply with the Practice Note. 64 Rule 23.13 requires compliance with the Practice Note but it also provides that an expert report must set out separately each of the factual findings or assumptions on which the expert's opinion is based: r 23.13(1)(e). The Practice Note provides that an expert shall attach or exhibit to their report copies of documents that record any instructions given to the expert: para 5.2(c)(i). Further to that, at para 5.1 the Practice Note specifies that the contents of expert reports must conform with the requirements of the Code. The Code specifies at para 3(d) that expert reports should provide 'the assumptions and material facts on which each opinion expressed in the report is based [a letter of instructions may be annexed]'. 65 Practice notes provide guidance as to the practices of the Court. Whilst they complement particular legislative provisions or rules of the Court, it would be artificial to elevate the status of this Practice Note to requiring production of documents without regard to the principles of privilege and implied waiver. Further, acknowledging that r 23.13 incorporates compliance with the Practice Note, it should be observed that any failure to comply with r 23.13 of the Federal Court Rules does not automatically make any expert evidence inadmissible: Mineralogy Pty Ltd v Sino Iron Pty Ltd (No 5) [2015] FCA 571 at [11]. 66 In support of its contention that r 23.13 requires all instructions to an expert to be disclosed (and that in this case this extends to separate instructions provided by A&O), ANIP referred to the reasons of Lee J in BrisConnections Finance Pty Limited (Receivers and Managers Appointed) v Arup Pty Limited [2017] FCA 1268; (2017) 252 FCR 450 at [71], cited by the Full Court in New Aim Pty Ltd v Leung [2023] FCAFC 67 at [88]. 67 It is to be recalled that Lee J was addressing a slightly different point, being the manner in which questions to experts by the instructor requesting a report might be formulated (r 23.13(1)(d)) and the need for transparency in that regard. In this case the Expert Reports do not purport to identify or respond to any question from A&O. They purport to respond to the questions asked of them by Corrs. The work of the expert is to attend to the questions 'the expert was asked to address' (original emphasis): BrisConnections at [71]. The iterations of the Corrs instructions which contain the questions that the experts have been asked to address in the relevant reports have been disclosed. 68 However, that does not resolve the question of the relevance of the Documents in the context of privilege and waiver. The fact that A&O prepared the Documents and not Corrs does not of itself shield them from production. That the Documents were prepared by different lawyers and some years previously are matters that are relevant in considering whether to draw an inference as to the influence of those Documents on the Expert Reports, but the involvement of different lawyers does not determine the privilege issue. That task remains to be undertaken having regard to the implied waiver principles summarised above. 69 Against the backdrop of those principles, I turn to the circumstances of the Expert Reports.

The Expert Reports 70 As already noted, the reference to A&O's instructions was made by the experts themselves. 71 The Corrs instructions attached to the Expert Reports do not cross-refer or incorporate the communications to the experts from A&O. Having reviewed the instructions from Corrs forming Appendix PM1 to Mr Moore's 16 May 2023 report, there do not appear to be any references to the instructions provided by A&O relating to the 2017 and 2018 site visits. There are references to samples taken in the 2017 and 2018 site visits. In a Corrs letter of instruction of 22 December 2022, the experts are asked to confirm details of the locations sampled during their site visits (including in 2017, 2018 and 2022). A schedule then lists the sample area, module, plant reference, item, the module fabrication yard (MFY) involved and the coating country. The details to be confirmed by the experts are set out in tables. I observe that having heard much of the lay evidence already, it is readily apparent that details identifying modules, MFYs etc were maintained and have been disclosed by JKC or INPEX (or both). In a Corrs letter of instruction of 4 May 2023, Corrs refer to a separate sample provided to the experts in 2017 known as 'spool 6'. The experts are then told to assume certain facts about spool 6 (the line from which it was removed, its coating records etc). There is therefore transparency as to the location of the samples the subject of the Expert Reports and the discrete assumptions the experts were asked to rely on in relation to spool 6. This is relevant context in considering the Expert Reports. 72 Without purporting to describe the Expert Reports in detail, there are a number of important elements to note. 73 In Mr Moore's report he describes what occurred on the three site visits undertaken in 2017, 2018 and 2022. 74 He explains that on the first day on site in 2017 and 2018 the experts were given a site tour to familiarise themselves with the layout of the Ichthys LNG Plant and to view the current conditions of the coating. On all other days (including in 2022, leaving aside a joint inspection date) the experts drove the inspection, requesting to inspect specific areas displaying particular features. Mr Moore explains that they selected for inspection areas of apparently good coating, areas with evidence of erosion, areas with evidence of rust crazing, areas coated in different MFYs, areas with varying degrees of environmental exposure, areas with and without insulation and areas under different types of insulation. In 2022 they also inspected areas with thermal degradation and areas undergoing remediation. 75 Mr Moore describes the inspection and testing undertaken on site and in the United Kingdom. 76 Mr Moore sets out details of the 19 areas sampled in 2017, the 26 areas sampled in 2018 and the 20 areas sampled in 2022 (the report includes in a later section details of the type of sampling undertaken at the sample sites, all recorded and disclosed in spreadsheet format, and with the statement that 'in total, 248 samples were taken to investigate the coating issue from various areas of the Plant'). 77 Further as to the 2017 visit, Mr Moore includes a photo of a pipe section (spool 6) and refers to the assumptions he was asked to make by Corrs about the provenance of the section. 78 Further as to the 2018 visit, Mr Moore includes a photo of coated pipe sections they were shown, a map showing their location, and states that they selected four samples from the pipe sections. 79 Mr Moore also describes in general terms the results of the visual inspections carried out in 2017, 2018 and 2022 as to the condition of the Plant and provides photos. 80 He then sets out MTD's approach to testing. Although lengthy, I extract the following from Mr Moore's report by way of example, for reasons that will become apparent: F. APPROACH TO TESTING I228 16. Inspection and Sampling Rationale 16.1. During the 2017 attendance Mr McCormick and I inspected components and took samples from several different areas of the Plant so as to encompass variables which might be relevant to the failure of the coating. In summary, in 2017, we inspected and took samples representing: 16.1.1. Different MFYs; primarily COOEC, CUEL and STP&I. In addition, other coated components from equipment suppliers were also tested; 16.1.2. Different substrates underlying the coating; carbon steel and stainless steel; 16.1.3. Insulated and uninsulated Plant; 16.1.4. Areas with varying degrees of environmental exposure; and 16.1.5. Areas showing varying degrees of coating breakdown. 16.2. The purpose of inspecting and testing the areas representing the variables above was to determine if a common feature existed throughout the areas displaying breakdown as related to either the formulation of the coating, the application of the coating or service environment which might result in the coating issues on Site. 16.3. The sampling and testing during the 2018 attendance on Site was informed by the work conducted in 2017. Given previous results we specifically addressed the following issues whilst on Site in 2018: 16.3.1. Targeted inspection and sampling of areas of coating breakdown; 16.3.2. Use of new sampling/testing techniques to investigate features identified in 2017, but which required more specific samples; 16.3.3. Inspection of Plant areas inaccessible in 2017 (particularly the Flare area); 16.3.4. Sampling of the coating based on specific features identified during and since the 2017 visit; and 16.3.5. Assessment of degradation in the coating between 2017 and 2018. 16.4. In 2020, when we were not able to attend site, we requested samples from areas under mineral wool insulation to investigate the effect of operational temperatures on the coating. These samples were taken by INPEX personnel following procedures drawn up by MTD. 16.5. Sampling and testing during the 2022 attendance on Site was informed by the work conducted in 2017 and 2018. Given previous results we specifically addressed the following issues whilst on Site in 2022: 16.5.1. Targeted inspection and sampling of high temperature service areas; 16.5.2. Assessment of degradation in the coating between 2017/2018 and 2022; 16.5.3. Inspection of remediated areas and ongoing remediation; and 16.5.4. Participated in the joint inspection on Thursday 18th August. 16.6. The samples obtained in these three visits are described in more detail in section 22. 81 The report continues over the course of some 100 pages to set out and discuss the testing and results of the various samples, including testing that was undertaken on site in 2017 and 2018 and testing undertaken by way of laboratory test work. Seventeen types of testing were explained and disclosed. 82 Mr Moore then addresses the particular questions that MTD was asked by Corrs to answer for the purpose of the Expert Reports. 83 Those instructions, unsurprisingly, ask for the experts to answer questions that go to the suitability of I228 for its intended purpose and use on the LNG Plant, and go to the underlying cause of the degradation of I228 on the site. The disclosed results of the tests on the samples are deployed in order to provide the experts' respective answers. 84 Against that backdrop, ANIP submitted (before receipt of the affidavit of Mr Strike) that: [T]he respondents do not know why or how any of the sampling locations were chosen. The respondents do not know whether they were chosen by Mr Moore and Mr McCormick, Allen & Overy, INPEX, or someone else. The respondents do not know what, if anything, the INPEX experts were told to assume for the purposes of their inspection, sampling and testing, or what documents (if any) they were given or to which they were referred. The respondents do not know whether additional areas were sampled and tested but, for one (undisclosed) reason or another, not ultimately included in the reports. 85 During the hearing ANIP submitted that the question of the purpose of the visit remains in issue and that ANIP is entitled to test and understand the circumstances in which the experts went on site in 2017 and 2018. It says there is no transparency as to how it is that the experts came to be on site or why they were testing in a particular way. It says these things have a significant impact on what is set out in their reports, and it is inconsistent for INPEX to rely on the Expert Reports but claim privilege over the Documents to avoid transparency. It says that it cannot obtain a proper understanding of the Expert Reports without inspection of the Documents, and that INPEX cannot shield information that would normally be required to obtain a full and proper understanding of the Expert Reports from the eyes of ANIP in one action by having lawyers in another action provide those instructions.

Determination 86 Having regard to all the circumstances, ANIP has not persuaded me that there has been an implied waiver of the privilege claimed over the Documents. 87 I accept that it is significant that the experts have referred in the Expert Reports to the fact that they attended site in 2017 and 2018 on instructions from A&O and that they undertook testing of samples identified during those site visits. The fact of the visits is consistent with the evidence of Mr van Brakel and Mr Jenaway. Similarly, the experts undertook a site visit in 2022. 88 However, I do not accept ANIP's submission to the effect that it is in the dark as to the purpose of the visits, what occurred at those visits or how the sampling was undertaken, and that it must have access to the Documents in order to understand those things and to understand the Expert Reports. 89 Much can be inferred as to the reason for the site visits. It was no secret by 2017 (as the lay evidence has disclosed) that degradation in the I228 coating on piping and equipment at the Plant had been identified and its cause was being investigated, including by ANIP. INPEX, JKC and ANIP were in discussions about such matters (and I refer to ANIP generally in this regard, without meaning to comment on which corporate entity may or may not have been involved). 90 But in any event, Mr Moore's report makes apparent the reason for the site visits and what was undertaken. The extracts from section 16 extracted above disclose the purpose for inspecting, taking samples and testing those samples. The purpose was 'to determine if a common feature existed throughout the areas displaying breakdown as related to either the formulation of the coating, the application of the coating or service environment which might result in the coating issues on Site'. 91 As to ANIP's suggestion that there may have been further areas of sampling that have not been disclosed, I am not persuaded. On the contrary, in light of Mr Strike's affidavit, I understand the evidence to mean that all the sampling that was undertaken was disclosed by the experts. 92 ANIP places weight on the fact that the 2017 work 'informed' the 2018 work, which in turn 'informed' the 2022 work, in support of an alleged relevant link between the content of the Documents and the Reports. Again, this aspect is explained by Mr Moore in section 16 of his report. Further, by the letter adduced through Mr Strike's affidavit, Mr Moore confirms that his reference to 'work' is to the work he described in his report - that is, the inspection, sampling and subsequent laboratory work. 93 It is apparent from Mr Moore's report that the results informed the next batch of sampling and testing and so on. The sampling, tests and results are explained in the report. The emphasis on the results is important. It is by no means clear that results might be influenced by the Documents in circumstances where: the experts have selected the samples; those samples are described and identified in the Corrs' instructions and in the Expert Reports; the experts have explained the basis for their selection of the samples (see Mr Moore's explanation for the cross-selection of sample sites referred to at [74] above); and the experts have undertaken the tests and brought about the results. It is to be borne in mind that these are technical tests performed by technical scientists. It is their work that has brought about the relevant results. 94 This necessarily limited evaluation of the Expert Reports, undertaken whilst the trial is proceeding but experts have yet to be called, to my mind does not reveal an issue of prejudice or unfairness to ANIP if the Documents are not inspected. The Expert Reports refer to the purpose of the site visits. They refer to the work undertaken. They refer to the inspection, the sampling and the tests. The opinions sought from the experts by Corrs for the purpose of the Expert Reports are clearly disclosed. The experts have confirmed that their respective reports identify all the materials and assumptions upon which they have relied in forming the opinions expressed (a matter to which I return at [96] below). The questions asked by Corrs are openly answered in the Expert Reports. It is not apparent that access to the Documents is required in order to enable ANIP to properly understand the Expert Reports. 95 I am not satisfied that there is evidence from which an inference can be drawn that the Documents were used in a way that could be said to influence the content of the Expert Reports. Whilst A&O may have arranged the 2017 and 2018 site visits, Mr Moore has set out the manner in which those visits proceeded and the level of practical control that he and Mr McCormick had over the sampling and testing. For the reasons given, the Expert Reports disclose in a transparent manner the tasks undertaken, the questions asked by Corrs, and the materials and assumptions relied upon for the purpose of answering those questions. 96 It is appropriate to make an observation about the statements by the experts (in their letters attached to the Strike affidavit) that their respective reports identify all the materials and assumptions upon which they have relied in forming the opinions expressed. The experts do not make a statement in the terms that were the subject of Tottle J's concern in Westgem; that is, they do not expressly state that they were not relevantly influenced by anything in the Documents. However, I acknowledge that it might be said that they have implied something similar, having regard to their letters. 97 I therefore think it appropriate to apply some caution when considering the expert's own statements that they have identified all of the materials and assumptions upon which they have relied in forming their opinions. I have not viewed those statements in isolation. I have also had regard to the inherent probabilities of the purpose of the 2017 and 2018 site visits, the disclosure of the purpose by Mr Moore, and the clear recitation in the Expert Reports of the details about the sampling and testing, the results of which on the face of those reports provide a basis for the opinions. 98 These matters reinforce my view that it is appropriate to give weight to the statements by the experts that the relevant materials and assumptions upon which their opinions are expressed are disclosed in the Expert Reports. There is no objective basis upon which those statements are impugned. 99 Whilst ANIP asserts that it cannot properly test such statements without access to the Documents, assuming for present purposes that to be so, then it is an outcome that follows, as recognised by White J in New Cap, from the requirement to strike a balance when considering the right to privilege. ANIP might perceive that the privilege gives INPEX some forensic advantage, but returning to Keane JA's statement in Watkins, the mere existence of that advantage cannot be a reason for the abrogation of the immunity. 100 In summary, having regard to the context, the objective circumstances, the statements of the experts within the Expert Reports and the letters annexed to the Strike affidavit: (a) I am not persuaded that the Documents were used in a way that could be said to relevantly influence the content of the Expert Reports; (b) use of the Expert Reports in circumstances where the experts have stated the materials and assumptions relied upon is not inconsistent with INPEX maintaining confidentiality in the Documents; (c) I do not consider it would be unfair for INPEX to rely on the Expert Reports without disclosure of the Documents; (d) further, I do not accept ANIP's submissions to the effect that the Expert Reports cannot properly be understood without reference to the Documents. 101 It follows that the application for inspection of the Documents should be dismissed. I certify that the preceding one hundred and one (101) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Banks-Smith.